Economy
KPMG: Gunns mill doubts
Tom Arup WA Today
TASMANIAN forestry company Gunns’ financial auditor KPMG has expressed doubts about its ability to raise financing for the Bell Bay pulp mill. Yet in a statement in the company’s half-year results, Gunns chief executive John Gay said it would announce a joint venture with a European investment bank for the mill before the end of next month. “The outcomes of these negotiations (between Gunns and potential financial backers for the mill) cannot presently be determined with certainty in the the current global financial environment,” KPMG partner LC Franklin wrote in the same results. Gunns announced on Friday, a day after its report, it will not reach its projected $200 million in earnings for the financial year. Gunns made the earnings projection just before selling additional shares to raise money to pay off its high debt levels. It has blamed the earnings decrease on a 15 per cent reduction in wood sales as timber and pulp prices collapse because of the global financial crisis. Read more here