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General manager Eduardo Navarro elaborated on the holding’s vision after yesterday’s shareholders’ meeting where its president, Roberto Angelini, said that Arauco is studying capital increase to support the forestry business.
“The challenge remains and the uncertainty is great.” Those are words that summarize the look at the moment of the country of the president of Empresas Copec, Roberto Angelini, in the framework of a shareholders meeting that took place yesterday in a national scenario marked by Covid-19.
After the meeting, the general manager of Empresas Copec, Eduardo Navarro, elaborated on the impact on the company’s business and the scope of the review of its investments.
When consulted, he acknowledged that Empresas Copec is receiving the impact of this adverse scenario, although he assured that his projections have always been thinking about the long term, which allows us to better face this global crisis scenario. In that line, he was emphatic: “The idea is not to cancel investments or stop deepening our lines of action, because it would be going against our DNA.”
But yes, he said, “we must act in moderation, adjusting the times and redefining priorities.” As he explained, “what seemed affordable six months or a year ago, perhaps requires a new analysis and that is something that is being analyzed in each subsidiary.”
Asked if the government should evaluate -depending on cases- support for companies that require it, Navarro said that the effort that institutions in Chile are making, in particular in defense of employment, is valuable.
“A productive ecosystem is structured around companies and must be supported. The important thing is that this occurs within a framework of consensus, technical discussions associated with political agreements that they convene,” he said.
The forestry business is one of the areas that concentrates the group’s efforts.
In the case of the company, he emphasized that Empresas Copec is doing everything possible to protect employment and keep operations active.
Board milestones
“We still do not know when or how we will overcome this challenge, but at Empresas Copec we know that we need to move forward despite this environment at a firm pace, in order to continue contributing to society from our business role,” Angelini said in his speech at the shareholders. In this line, he stressed that they must continue to develop their investments, although always reviewing the contexts in which the different activities in which the group participates, which has a presence in fuels, forestry and mining, among others. “It is clear that it has become necessary to adopt a somewhat more prudent attitude, which means choosing to strengthen our balance sheet and preserve higher levels of liquidity that allow us to face these uncertain times in the best possible way,” he said.
The businessman said that they put the investment plan for this year on review, and that they have had to propose a modification to the dividend policy in order to maintain their financial position, without significantly affecting the development plan.
According to the 2019 report of Empresas Copec, the investment base plan for the year amounts to US $ 2,390 million, where 71.1% is for the forestry business, 22.3% fuels, 0.5% in fishing and the rest in other activities.
The president of Empresas Copec maintained that “the size of the projects, the low prices in some of our exports and the uncertainty due to social and sanitary conditions, make it necessary to adopt a very prudent management in all businesses.”
At this point, Angelini advanced the company’s plans. “Putually, in the forestry business it is where we are making the greatest investment efforts, which could imply financial support from this matrix, among other ways, through a capital increase that is being studied in the subsidiary (Arauco)” , ad.
It should be remembered that in the forestry sector they are promoting the Arauco Plant Modernization and Expansion project (MAPA), which involves an investment of US $ 2.35 billion, being the highest in the history of the company linked to the Angelini group. The initiative reached 31.5% advance at the end of 2019, in line with what was scheduled.
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