Tuesday, December 17, 2013

APTT :Email Qn and Ans with CFO

Qn:

Thank you for for taking time to answer my questions.

I do have another concern.

From your prospectus,

Expected tax resolution is 46 million and company has set aside 50.2 million in loans for the settlement.
But the maximum amount claimed by the tax bureau is actually $122.4 million, a whopping 74 million difference.
Granted, company has mentioned the discussion is progressing well, but its coming to the end of 2013, and there is no announcement of any resolution yet.

In the event that the tax payable is much higher than what the company has set aside for, how will the company manage the shortfall, but accumulation more loans or reducing payout? Is there a contingency plan? Do the company expect to appeal? Is the judiciary process costly?


Also, the prospectus mentioned hedging loss in pre-IPO years. How is management managing that such that the problem will not recurred?

Finally is the interest rate for the revolving facility after hedging costs also 4%?

------Ans--------

As you point out we mentioned in the Q3 results that discussions were progressing well and in line with the estimates in the prospectus. We also mentioned that administratively, settlement may push into the new year, so we should not expect to see an announcement by now. We will let the market know as soon as there is something to announce; appreciate your patience.

The hedging losses in earlier years resulted from the off-shore USD debt structure; with the IPO we brought all of the debt on-shore in Taiwan with local banks, all in NT$ at a low cost, so this historical item has been removed.

Yes, the interest rate of 4% includes hedging costs.

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I think they stepsided the question of "what if", but nonetheless, glad that talks are progressing well as of dec.

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