Financial news
Written by: Lin Leqian
2020-02-28 10:15
Last updated: 2020-02-28 10:15Changhe (0001) announced that as of the fourth quarter of December last year, its Husky Energy had lost 2.34 billion Canadian dollars (approximately 13.65 billion Hong Kong dollars). The related losses will be offset by the sale of Hutchison Medical.
Husky recorded a loss of C $ 2.34 billion last quarter, mainly due to impairment of non-cash assets and other expenses of approximately C $ 2.3 billion, compared with a profit of C $ 216 million in the same period last year. Cash flow from operating activities decreased by 19.6% to C $ 469 million during the period, and revenue decreased by 4% to C $ 4.77 billion.
Changhe explained that Husky's loss was related to the Group's upstream assets in North America, including the Rising Sun Energy Project, the Atlantic Provinces, and Western Canada, which were largely based on low long-term commodity price assumptions and reduced future capital expenditures. The impact of future reductions in capital expenditure is a reduction in reserves, which in turn will reduce the value of assets. Other expenses include the write-off of exploration-related assets and the derecognition of certain assets at the Lima Refinery related to excess equipment following completion of the crude oil flexibility project.
As far as EBITDA is concerned, the group's non-cash loss of Husky is about 5.983 billion yuan. It will be sold by Hutchison Pharma in October last year. It will be converted from a subsidiary to a 49.86% associate. The Group's profitability last year was not affected by this loss.
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