Sacked CFR Management claims the company has operational profit


 

The reaction comes after the entire Board of Administrations was sacked for bad management that affected the financial situation of the company.

 

The Board of CFR SA observed, in the nine months of mandate, the commitments made to international financial institutions and passed measures which resulted in profit making and repaying the debts to the budget, claims the former Chairman of the Board, Florin Kubinschi.

“The Board of Administrators of Compania Nationala de Cai Ferate CFR SA, appointed in observance of the provisions of OUG 109/2011, has observed, during the approximately 9 months of mandate, the commitments made to the international financial institutions and passed a series of short-term operational measure, so CFR SA currently no longer has any debt to the state budget and to the budget of social insurances (unemployment, health and CAS), compared to the date when it took over the mandate, when the company had debts of RON 321 M to the state budget and the budget of social insurances,” reads a press release issued by Kubinschi after the Ministry of Transportation announced that the entire Board of Administrators was revoked on grounds of bad management that affected the financial situation of the company. According to Kubinschi, CFR SA – which manages the railroad infrastructure – registers a pretax profit worth RON 51.6 M, against a loss of RON 169.8 M provided by the rectified budget of incomes and losses for 2013 approved by the AGA of the company.

The operational result (EBITDA) at 30 November 2013 is 98.8 pc higher than the figure provided by the rectified budget for 2013 (RON 83.6 M), approved by the AGA of CFR SA. The company’s arrears at 30 November 2013 (RON 1.1 bln) are 26.6 pc under those registered at 31 March 2013 (RON 1.5 bln). The overdue loans at 30 November 2013 (RON 1.5 bln) are 26.9 pc smaller than at 31 March 2013 (RON 2.1 bln), according to the former chairman of the board.

“I consider that the economic efficiency-increasing initiatives adopted by the management team during its mandate have made the management of CFR SA by no means a bad one, as the measures adopted so far led to the observance by CFR SA of the objectives and targets assumed by the Government of Romania in the relation with the International Monetary Fund, the European Union and the World Bank,” Kubinschi adds.

“(…) A series of serious irregularities have been found in the management act of administrators, such as: the noncompliance with the obligation to supervise and control the executive of the company, which made it possible to perpetuate some loss-making acts for the company, conducted by the executive and discovered by control institutions, as well as infringing the provisions of the government’s emergency ordinance 109/2011 on the corporate governance of enterprises and other legal provisions,” the Ministry of Transportation explains in a communiqué about the dismissing of the top management of the state-run railroad company.

The Board comprised Florin Kubinschi (chairman, CFO Volksbank Romania), George Micu (member, CEO CFR SA), Enache Jiru (member, state secretary with the Ministry of Finance) and Sebastian Tcaciuc (member).

The AGA appointed a new Board made of Ovidiu Petrisor Artopolescu, member of the Supervisory Board of Transelectrica, Ovidiu Putura, state secretary with the Ministry of Justice, Victor Cionga, managing partner AZ Capital Advisors, Florin Luca, financial consultant, George Ciobanasu, financial auditor.

The new Board will soon meet in order to elect its new chairman. The General Meeting of Shareholders (AGA) gave the new Board of Administrators a mandate to make an urgent analysis of how George Micu fulfilled its obligations as interim CEO of the company.

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