Valoe Oyj - Company Announcement

VALOE HAS RECEIVED LOAN COMMITMENTS OF EUR 1.3 MILLION. VALOE MAKES A WRITE-DOWN IN THE MOTHER COMPANY’S FINANCIAL STATEMENTS FOR 2015 AND UPDATES THE SITUATION OF ITS FINANCING NEGOTIATIONS

Valoe Corporation                                                  Stock
Exchange Release          29 April 2016 at 18.45 Finnish time 



VALOE HAS RECEIVED LOAN COMMITMENTS OF EUR 1.3 MILLION. VALOE MAKES A
WRITE-DOWN IN THE MOTHER COMPANY’S FINANCIAL STATEMENTS FOR 2015 AND UPDATES
THE SITUATION OF ITS FINANCING NEGOTIATIONS 

Valoe has resolved to write down a revenue of EUR 0.7 million recognized on the
first quarter of 2015 based on a claim against Australian Savcor Group Ltd
Creditors Trust (former Savcor Group Ltd), in the financial statements for
2015. The claim was based on the share and asset sale agreement, signed in
2009, regarding the factories in China between Savcor Group Ltd and Cencorp
Corporation (now Valoe Corporation). Valoe claimed Savcor Group Ltd Creditors
Trust to pay taxes provided for in China that were recognized during Savcor
Group Ltd’s ownership. According to the information Valoe has received it has
become clear that Savcor Group Ltd Creditors Trust which is under Australian
liquidation process does, in Valoe’s opinion, no longer have enough assets or
income to pay the compensation even if the claim would be successful. In the
last quarter of 2015 Valoe recognized a tax cost of EUR 0.7 million related to
the above mentioned claim. This one-off cost related to the Beijing factory was
based on afterwards changed taxation of equipment imported in 2018. 

Since the end of the financial year the company’s financing situation has
declined. Valoe has to arrange an advance payment guarantee that is typical of
export business and financing of ca. EUR 2.0 – 4.0 million for building period
for the Ethiopian order from its suppliers and financers. By the disclosure of
this release Valoe has received loan commitments of ca. EUR 1.3 million for
building period financing for the EUR 15.8 million order from Ethiopia from the
company’s shareholders and promissory note holders. Valoe views that this
financing will enable the company to continue with the delivery with maximum
effort and provides time to arrange additional funding and guarantees.
Negotiations for additional funding and advance payment guarantee are ongoing
but not yet finished. 

On 5 April 2016 Valoe announced that Savcor Communications Pty Ltd has notified
Valoe that it has agreed with EMEFCY Group Ltd (former Savcor Group Ltd.), an
Australian company, that Valoe’s loan of ca. EUR 0.8 million with interests has
been transferred from the Australian company, former Savcor Group Ltd to Savcor
Communications on 5 April 2016.The loan shall fall due on 31 December 2016
unless the parties agree otherwise. The interest rate of the loan is 10.75%.
There is no guarantee provided for the loan. Valoe has started negotiations
with Savcor Communications Pty Ltd for new loan terms. Valoe’s object is to
agree with Savcor Communications Pty Ltd on converting the loan to a
subordinated loan. 

For the moment Valoe negotiates with debtors connected to the Beijing factory
and with the related company of the Savisalo family. Should the negotiations
have positive outcome Valoe would be released of all or at least major part of
the liabilities related to the operations of the Beijing factory, which would
improve Valoe Group’s result and balance sheet. 

Until above mentioned financing arrangements, guarantees and other arrangements
have been secured Valoe’s financing situation continues to be tight and until
then the sufficiency of the company’s financing and working capital for the
next twelve months involve very significant risks. If the company does not
succeed to secure sufficient financing for the building period of the order
from Ethiopia, the continuity of the company’s operation may be jeopardized. If
the above mentioned financing and guarantee for the order from Ethiopia would
be delayed or if the market situation gets worse it may take longer time to
turn orders into revenue. This would affect significantly the schedule in which
cash flow before investments would turn positive. In such a case the company’s
financing situation would further tighten. 

Valoe will disclose the company’s Annual Report for 2015 including the
financial statements, the Directors’s Report and the Corporate Governance
Statement latest on 30 April 2016. 





In Mikkeli 29 April 2016



Valoe Corporation

Board of Directors



For more information:
Iikka Savisalo, President and CEO, Valoe Corporation
Tel. +358 40 521 6082, email: iikka.savisalo@valoe.com



Distribution:
NASDAQ OMX, Helsinki
Main media
www.valoe.com



Valoe Corporation specializes in the clean energy, especially in photovoltaic
solutions. Valoe provides automated production technology for solar modules
based on the company’s own technology; production lines for modules; solar
modules and special components for solar modules. Valoe's head office is
located in Mikkeli, Finland.