Latvijas Kugnieciba                                    02.03.2005.

 

About Credit liabilities of the JSC Latvijas Kugnieciba



(Riga Stock Exchange note:

information source- Management Board according to the Company Register of 

the Republic of Latvia)



In line with the programme for fleet renewal three second-hand (built 2003) 

tankers, KOLKA, KULDIGA, KALTENE were bought and put into service. The loan 

for the purchase was arranged with western banks in amount of 75 million US 

dollars. The loan is to be repaid in 10 years and up to now two repayments have 

been done within the schedule. The results of operations are very positive.

About 75 million loan are still to be rapid for three Panmax type vessels – 

Riga, Zemgale and Latgale. These liabilities were undertaken by Latvian Shipping 

Company in 2001. According to the valuations of independent ship-brokers Braemar

Seascope and SSY the value of these vessels and importance in the world shipping 

market have considerably increased. Panamax vessels are operating with a profit.

About 27 million US dollars are the balances for LPG carriers Kurzeme and Vidzeme. 

Theses vessels are successfully operating for many years in Scandigas pool.

The situation when using brutal force and psychological presure the control is 

taken over in the company which are a serious player in the middle size world 

tanker market, causes misunderstanding amongst the business partners of the 

company worldwide and it may cause a refusal to future cooperation. This may 

result in a material loss to the company as well as to a damage to its good 

name and reputation



Aivars Enkuzens

Board Member, Financial Director

Valerijs Godunovs

Board Memeber, Vice President





Comments by the Chairman of the Board of JSC „Latvijas kuģniecība” 



(Riga Stock Exchange note: 

Information source - Management Board elected on February 14, 2005)



„The statements, made by the former member of the dismissed Board of 

JSC „Latvijas kuģniecība” (LASCO) Valerijs Godunovs, regarding possible impact 

on repayment of LASCO credit obligations, which may be caused by suspension of 

quotation of LASCO shares at Riga Stock Exchange, are demagogic. It has to be 

taken into account, that public uproar about LASCO was caused by unlawful 

decisions by the former LASCO Board itself, including V.Godunovs as well, which 

were made in my absence. Moreover, it seems that such public statements made by 

V.Godunovs, are directly aimed at deliberately reducing the value of LASCO, as 

well as at wilful misinformation of LASCO clients, business partners, investors 

and general public. Credit obligations of LASCO are commensurable with company’s 

turnover and value of its assets. Short-term credit obligations represent a small 

part of a total obligations’ volume and, at any stage, can be covered from LASCO 

own financial sources. Depending on the compliance or non-compliance with various 

credit terms, provided for in the contracts for involvement of short-term credits, 

the banks may revise the conditions, on which the credits are provided for or 

repaid. There has to be a number of different circumstances of very serious nature, 

combined together, for the bank to request for anticipatory repayment of loans. 

A part of LASCO credit obligations arose at the time, when LASCO was still a 

state-owned enterprise, therefore it is not correct to state that possible 

suspension of LASCO shares’ quotation at Riga Stock Exchange may cause 

anticipatory repayment of all credit obligations. The information about specific 

terms of credit agreements is considered to be confidential.”



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