September 12, 2008

Goodwill Group Posts 2.7-B.-Yen Excess Debt

Tokyo, Sept 12 (Jiji Press)--Struggling Japanese staffing service firm Goodwill Group Inc. said Friday its debts exceeded assets by nearly 2.7 billion yen as of the end of June, due to heavy losses stemming from the liquidation of its scandal-tainted day labor staffing unit.

For the business year that ended June, Goodwill Group's consolidated net loss came to 27,416 million yen. As a result, the group saw excessive debts worth 2,691 million yen on June 30, the company said.

Under the Tokyo Stock Exchange's listing rules, Goodwill Group shares will likely be moved to the exchange's second section from the prestigious first sections in November.

The company said the net loss expansion came as it booked 15.9- billion-yen charges for the liquidation of the day labor staffing unit, Goodwill Inc., in late July.

The group also incurred an operating loss of 6,683 million yen, compared with a profit of 9,945 million yen a year ago.

Goodwill Group is rebuilding itself under the initiative of Cerberus, a leading U.S. private equity fund specializing in corporate restructuring, and U.S. investment bank Morgan Stanley.

Charles Abadie, a Cerberus executive, will take the post of chairman at the ailing Japanese firm later this month.

Goodwill Group is confident that it can eliminate the excess debt as it is set to receive 15.5 billion yen in fresh capital from the U.S. partners in December, a company spokesman said.[EARNINGS]END

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