Despite strenuously denying rumors that it was financially troubled, the extent of furniture importer Kika's woes have been revealed. Ashtrom Properties Ltd. (TASE:ASPR), which owns 15% of Kika Israel (controlled by Salomon Betito), has reported that Kika Israel lost NIS 45 million in 2011, after losing NIS 13 million in 2010, and has had a "going concern" warning attached to it, questioning its future existence.
Kika opened its furniture store in Netanya in September 2011 under license from the Austrian furniture producer, generating revenue of NIS 27 million, in the four months before the end of the year. Kika Israel has obligations amounting to NIS 146 million, and Ashtrom Properties recorded the furniture company as having zero value.
However, Ashtrom Properties intends to continue investing in Kika Israel but from an accounting perspective has already recognized the deduction of the NIS 19.4 million it has invested - its full investment in Kika.
Published by Globes, Israel business news - www.globes-online.com - on April 1, 2012
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