MOSCOW, July 10 (RIA Novosti) - Power Machines (Silovye Mashiny) [RTS: SILM], Russia's leading heavy machinery manufacturer, said Monday its net loss calculated to International Financial Reporting Standards totaled $40.5 million in 2005.
Power Machines, which produces and supplies equipment for hydro, steam, gas and nuclear power plants, said it had posted a net profit of $10.2 million in 2004.
The company earlier reported it had received a net profit of $6.87 million for 2005 in accordance with its financial statements prepared under Russian Accounting Standards.
"The divergences in RAS and IFRS indicators are due to differences in Russian and international accounting and financial reporting standards. In particular, the company's international financial reporting statements reflect a $27.71-mln potential loss that the company may sustain working on long-term contracts," Power Machines said in a news release.
The company's IFRS 2005 pre-tax loss was $46.62 million against a $23.92-mln profit a year earlier. The company's sales, on the contrary, rose 0.8% to $667.17 million, whereas gross profit was down 12.2% to $162.37 million.
The company's portfolio of orders from customers exceeded $1.5 billion in 2005 or 20% more than in 2004.
The company also named some other factors that had affected its financial performance in 2005.
"First of all, these are long-term contracts connected with engineering and the supply of equipment for thermal power stations in Vietnam and India," Power Machines said. "These contracts were signed in 2003-2004 under tight price and technical terms but enabled the company to enter the thermal energy markets of Vietnam and India and subsequently expand its presence there."
