JIS News

Prime Minister, Bruce Golding, has instructed the Ministry of Finance and the Public Service to develop a strategy to deal with the inherent liabilities of Ackendown Newton Development Company Limited, which was responsible for the planning, design and construction of the Sandals Whitehouse hotel in Westmoreland.
The company was jointly owned by Gorstew Limited (33 per cent), the National Investment Bank (30 per cent) and the Urban Development Corporation (37 per cent).In a statement to the House of Representatives yesterday (Oct. 30), Mr. Golding said that Ackendown “has incurred deficits on its operations ever since its inception”. For 2005/06 it had an operating loss of US$3.11 million, with losses of US$2.86 million for 2006/07, the Prime Minister said, noting that “the company’s net losses were affected by a change in the basis used in the valuation of the hotel property.”
He further informed that at March 31, 2007, Ackendown recorded working capital deficit of US$8.8 million. “Total assets stood at US$87.41 million while liabilities totalled US$82.33 million, a debt to assets ratio far outside the industry norm,” Mr. Golding stated.
In the meanwhile, the Prime Minister said that “Ackendown remains in dire financial straits.”
“It has been unable to remit the General Consumption Tax (GCT) collected on rent which it receives and which should have been paid into the Consolidated Fund. As at the end of September, this amounted to US$1.17 million,” he informed.
He noted that “presently, the company requires urgently an injection of US$700,000 to meet inescapable operational expenses including insurance premiums, which will become due in November. The Ministry of Finance and Public Service is addressing the issue.”
In the meantime, the Prime Minister told the House that cash flow projections for September 2007 to March 2008 shows a projected cash deficit of US$1.15 million at the end of November, assuming an injection of US$700,000 in October and the remittance of $1.3 billion in GCT payments.
The cash deficit is expected to rise to US$1.9 billion at the end of February 2008 and to decline to $1.6 billion at the end of March, predicated on the expected increase in occupancy-related rental income in March.

Skip to content