The sugar company of Rose-Belle is struggling. For the 2015-16 fiscal year, which ended in June, the deficit was over Rs 250 million.
Rose Belle Sugar Estate (RBSE) can hardly amend the situation. For the fiscal year ending June 30, it should report a deficit of over Rs 250 million. The sugar company owns about 5881 acres at Rose-Belle and it has been facing financial worries for a while. « La production de cannes a été déficitaire. Le problème de liquidités ne nous a pas permis d’acheter des fertilisants à temps et cela a eu un impact sur la récolte. Cette année on a pris des dispositions pour avoir les fertilisants à temps » says a member of the board.
Several options are being considered to allow Rose Belle Sugar Estate to improve its financial position. Some lands are being sold. Around fifty acres of land at Rose-Belle and Gros Billot were released for sale in March which will yield about Rs 175 million. This could improve the company’s cash flow and repay some of the debt.
Lasting solution: « Vendre n’est cependant pas une solution durable », says our source. The intention is certainly not to strip the sugar company of its land. The Board remains open to proposals for joint ventures up profitable operations and grow its land assets. There is also talk of expanding the company that operates the shopping center on the old Belle Rose-mill for additional income.
A report by the BDO firm in May 2015 had also reported malpractices in Rose Belle Sugar Estate. While in 2007 the company still had Rs 146.2 million of cash, in 2013 it was in the red to the tune of Rs 95.5 million. For the fiscal year ending in December 2014, RBSE faced operational losses of Rs 55.6 million. This amount does not include the Rs 122.8 million that the company owes the government.
A debt that it had stopped paying for lack of liquidity. BDO also had to report several cases of flagrant mismanagement, malpractices and even potential fraud. It also argued that RBSE was “not a very efficient organization.” Examples include the management of land which had been leased to third persons or entities. It was established that no monitoring was done and that the debt collection department was not doing its job.