Bumi, the scandal-hit mining group, has revealed a $200 million black hole at its main subsidiary, as it released much-delayed financial results for 2012.
The FTSE-250 company – which has been dogged by a very public battle for control between financier Nat Rothschild and his co-founders, Indonesia's powerful Bakrie family – said it would seek to recover the funds that were spent over the past two years "with no clear business purpose".
A source close to Mr Rothschild, who is no longer on the board but remains the company’s second-largest shareholder, said: “It’s appalling but not surprising.”
Bumi revealed the missing funds as it reported a 2012 pre- tax loss of $2.4 billion, reflecting a decline in value of its Indonesian assets, in part due to expectations of a lower coal price.
The company said that $152 million in 2012 and $49 million in 2011 had been wrongly attributed to the maintenance and extension of hauling roads, payments to landowners, consulting costs and goodwill.
It is working with the Serious Fraud Office and Indonesian authorities to track those funds down. Nick von Schirnding, who took over as chief executive of Bumi in January, said he had his suspicions over where the money ended up.
“I would rather announce what we can once we’ve got the monies in the bank account. Rest assured I’m not going to leave any stone unturned.”
The company has removed the chief executive and six other senior managers from Berau, the Borneo coal mine in which it has an 85 per cent stake. It continues to search for a group finance director and chief mining officer to be based in Jakarta.
Bumi last month asked for its shares to be suspended amid the inquiry into irregular payments at Berau. It said yesterday it would apply for trading to resume once it had completed the process of improving internal controls, ahead of the annual meeting on June 26th. – (Guardian service)
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