Loss of Azerkosmos Totaled 48.3 Million Manat

The state-run Azerkosmos promulgated an annual financial report through BSE, according to which, the company's losses for 2013 before tax profits exceeded 48.3 million manat.

Audit of the financial statements of Azerkosmos was conducted by Ernst & Young.

On 4 April 2013 Azerkosmos transferred the company Measat 39.5% of the capacity of the telecommunication satellite Azerspace1 / Afrikasat-1a.

The equipment transferred under a financial lease for 15 years was estimated at 73.574 million manat. The Malaysian company agreed to pay the Azerbaijani side $ 125,697,000 in thirty uniform parts. Last year, revenues on this line totaled 6,573,900 AZN.

The report says that in order to finance 85% of the production costs of the satellite Azerspace1, on August 19, 2011 there was signed a credit contract with the New York branch of BNP Paribas Bank in the amount of $ 116,600,000, which is fully utilized. The credit is subject to full repayment in December 2022. The annual effective interest rate of the loan is 2.65%. Until December 31, 2013 more than $ 12 million was paid to the French bank as a fee for the granted credit.

For launching the satellite a loan of about $ 89.6 million (85% of the costs), under 2.95% per annum, was borrowed from the European branch of Sumitomo Mitsui Corp. The credit is refundable up to February 2023 in twenty uniform parts. Until December 31, 2013 the Japanese corporation was paid more than $ 8.7 million as a fee for the granted credit.

The state subsidizes the activity of JSC in the form of interest-free loans. In 2011, the Ministry of Finance provided the company 7,417,500 AZN, and in 2013 - 6.941 million manat. Last year, it received a loan (1,489,000 AZN) also from the Ministry of Communications and High Technology. These loans shall be returned as soon as the financial position of Azerkosmos improves. The company's management expects that this will come in 2022-2023.

It should be noted that this year the Ministry of Finance provided the company 3.64 million manat of extra credit. Direct funding from the state budget for Azerkosmos activity this year was 2.578 million manat. Just by the end of 2013 the liabilities of Azerkosmos reached 173 million manat.

In 2013, cost of sales (aging, depreciation, taxes, wages and related expenses) amounted to 8.7 million manat. General and administrative expenses in 2013 increased compared to the previous year by 49.3% and exceeded 3.9 million manat. Tax losses by the beginning of this year had exceeded 17 million manat. The main part of the company's losses (36.1 million AZN) was formed as a result of the depreciation of fixed assets. In 2013, its assets decreased from 210 million to 173.7 million manat.

Turan turned to archival information about the satellite launch in February 2013, from which it follows that the service life of the satellite reaches the age of 14, making a risky project in terms of financial performance. --08B-