By Deborah Hill Cone
Friday 19th April 2002 |
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Total related loans outstanding at December 31, 2001 accounted for 16.5% of the loan book of $400 million, up from 6.95% at the same time the previous year.
All types of related loans totalled $67.7 million, made up of loans to subsidiaries ($15.1 million) associated parties ($20.7 million) and loans to other related parties ($31.7 million).
The new financial statements reveal for the first time Mr Watson's main investment vehicle Cullen Investments has also borrowed money from Elders, although the loan does not show up as a charge on Cullen Investments' March 26 annual return filed with the Companies Office.
Other companies linked to Mr Watson which have received loans and advances from Elders include:
Accountancy specialists pay particular attention to inter-company debt or related-party transactions because they can obscure the true extent of indebtedness.
During the current financial period loans to three other related parties - Platinum Retail, Nationwide Finance and Courtney Investments - were fully repaid.
Mr Hotchin, who owns 50% of Elders Finance, has also borrowed money from the finance company - his loan was $1.2 million, up from $267,000 six months earlier.
Elders Finance has been growing fiercely over the past year, allowing it to report a positive profit result.
It had an after-tax profit of $4.9 million for the six months to December 31, double the $2.4 million profit of the previous year.
Mr Finnigan said over the past year Elders Finance has experienced a marked increase in total revenues, considerable asset growth and a 260% increase in its customer base.
"Our diverse lending portfolio has capitalised on a broad range of finance opportunities and been the key to achieving steady and consistent growth, ensuring the long-term security for our investors," Mr Finnigan said.
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