MVR 160 million reduced from Fenaka expenses, MVR 900 million on debt repaid

Fenaka Corporation has said that it has made major progress this year in the work to reform its struggling finances.

A report prepared on the achievements of Fenaka in the year preceding last November states that when the management took over, over MVR 4 billion had been recorded as company debt.

The report cites that this was due to over employment of staff, conducting unnecessary projects and increase in unnecessary expenses, and described it as a negligence towards the company and customers.

The report states that the highest priority of the new management was to decrease the excess employees in a way that would not negatively affect the company's services, to halt loss-making projects and to decrease operational costs.

With these efforts, Fenaka's operational costs have been decreased by MVR 160 million, the report indicates.

As of November last year, MVR 300 million of the MVR 1.3 billion owed as debt has also been repaid, it said.

In addition to this, MVR 600 million of MVR 3.4 billion owed to vendors has also been paid. With this, payments have been fully completed to 281 vendors.

However, as Fenaka's main revenue is through utility services provided at controlled prices, the biggest challenge faced by the company is complete repayment of the huge debts while ensuring services are provided uninterrupted, the report said.

It said that 40 percent of this year's revenue has been spent of debt repayment. Hence, the company is in need of debt restructuring and financial assistance, the report said.

The report states that while difficult measures were taken to improve the company's financial situation, the company has also taken steps to further strengthen its services across the atolls.

As such, water services have been commenced in 21 additional islands, and sewerage services in four.

As for the electricity services, 61 new gensets were placed in 53 islands to increase capacity.

The report further states that work was done over the past year to modernize its services and to make them environmentally sustainable.

A data centre has also been set up to digitalize Fenaka services, a new portal has been introduced for HR, vendors and internal ticketing, and smart meters have also been introduced.