Riyadh - Mubasher: Nama Chemicals announced that its accumulated losses reached SAR 1.07 billion by the end of March 2017, representing 83.6% of capital.

The company attributed the high accumulated losses to lower production capacity of plants in last years as a result of the global markets’ situation, fierce competition, and the obstacles of custom fees in the European markets.

Due to the aforementioned reasons, the company reduced the book value of assets as per the financial standards by SAR 655 million, according to a bourse filing on Wednesday.

Lower prices along with an increase in global production as a reason for the slowdown in the Chinese economy and lower demand on epoxy resin in global markets, which led to an intense competition in prices, eventually affected the company’s results.

Higher accumulated losses were also attributable to the decrease of the exchange rate of the euro against the Saudi riyal since 2015 by around 15%, leading to lower sales’ value of the company to the European market, in addition to imposing fees of 6.5% on Saudi imports to the European Union (EU) and Turkey.

Moreover, the hike in power products’ prices and electricity and gas tariffs in the KSA resulted in higher production costs by about 2.3% or SAR 12.5 million.

Nama noted that it will apply a number of procedures and instructions issued by the Capital Market Authority (CMA) concerning the listed companies of which accumulated losses reached 20% or more of capital.