Fenaka suffered losses exceeding USD 35.5 million in 2024

Audit report released by the Auditor General's Office has revealed that Fenaka Corporation Limited suffered losses exceeding MVR 547 million (USD 35.5 million) in 2024.

According to the 2024 audit report for Fenaka Corporation Limited released by the Auditor General’s Office, the company incurred a net loss of more than MVR 547 million that year.

Due to the company’s financial condition and the lack of complete documentation to verify the accuracy of its accounts, auditors declined to express an opinion on the financial statements.

The report indicates that by the end of 2024, Fenaka generated a total revenue of MVR 2.5 billion (USD 162 million).

However, due to high administrative and other expenses, the company’s overall losses escalated significantly.

The report shows that over MVR 1 billion (USD 64.9 million) was spent on operational expenses alone.

Furthermore, the audit report states that there were major discrepancies in the accounting of assets and materials used for providing electricity and water services, as well as in the maintenance of stock and inventory records.

Specifically, because business transactions and journal entries were not fully recorded, auditors faced significant challenges in verifying the accuracy of the financial statements.

It was also noted that debts owed to private businesses and the government in connection with the company's electricity grid and other projects have risen sharply.

According to the report, by the end of 2024, the company had over MVR 3.5 billion (USD 227.2 million) in trade payables alone due to electricity-related costs and other factors.

The final section of the report notes that despite these severe financial challenges and losses, the company continued operating with government assistance, and that efforts are currently underway to transfer some of its services to other companies following recent reforms and policy changes.

Due to such issues, President Muizzu decided on September 7 to dissolve Fenaka and transfer its operations to STELCO.

Announcing this at a press conference held at the President's Office, President Muizzu stated that the audit report also confirms the company was misused during the previous MDP administration.

President Muizzu added that as part of this transition, the company will be right-sized and excess staff will be reduced.