CCC’s fate is at stake
The fate of a Polish shoe manufacturer that has been in big financial trouble for several years is expected to be decided in the coming days.
CCC, Poland’s largest shoe manufacturer, was valued at PLN 12 billion just two years before the pandemic. Today, its valuation is a mere PLN 2 billion. The company was hit hard by the coronacrisis. Another problem proved to be the war and the increase in interest rates. As a result, CCC’s debt has grown heavily.
The coming days may decide the company’s future fate. An extraordinary general meeting of shareholders will be held in the last days of October. Among other things, the talks are expected to concern recapitalizing the company with up to PLN 500 million by issuing new shares.
In addition, the company’s authorities will meet with bondholders. In 2018, they lent CCC PLN 2010 million. If no agreement is reached, the company will have to return the money to them. And this means a lot of problems for it.
According to experts, there is little chance that CCC will significantly reduce its debt in the near future. The company could achieve this by improving its performance. However, this is not a simple sentence in a situation with such high inflation, high energy prices and interest rates.
CCC is currently trying to save itself by strengthening its balance sheet and medium-term financing structure. In addition, the company is betting on deep cost-cutting, reducing inventory levels and extending payment terms. Experts at mBank estimate that it has a chance to start generating net profit again in 2024.
