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Thursday, July 18, 2024

Forest products firm struggles to survive

Norske Skog was once among Norway’s biggest and most successful companies, but now some analysts are wondering whether it will survive. The company has had to adjust its financial results for last year, leaving it with a huge loss after a battle with its accounting firm.

Industry players have claimed they’ve never seen the likes of the quarrel going on between Norske Skog and accounting firm Ernst & Young. It culminated with Norske Skog firing the company after it wouldn’t approve the values Norske Skog placed on its factories. “I can’t remember any such case like this one,” Per Hanstad of the accountants’ trade association in Norway, Revisorforeningen, told newspaper Dagens Næringsliv (DN).

Norske Skog also ended up having to adjust its fourth-quarter results for 2015, writing off NOK 482 million worth of perceived tax advantages and thus ending with a loss of NOK 1.44 billion and capital of just NOK 72 million.

The company has suffered for several years from diving markets for its paper products and heavy debt incurred after an acquisition binge in the early 2000s.  The company has been trying to cut its debt but still hasn’t come to terms with its creditors. staff



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