Inoperative Trust International Transport grapples with lawsuits

AMMAN — Lawsuits filed in courts against Trust International Transport carry JD0.8 million in claims for compensation.

According to the notes accompanying the unaudited review of financial statements as of March 31, 2015, the necessary provisions have been taken for those compensation claims in lieu of deaths and injuries involving the company's buses.

The unaudited review noted that other lawsuits with unspecified value and results are still under examination in courts.

Within its plans for 2015, the company intends to amicably resolve the disputes at the least possible payouts.

"The company worked and is still working on amicable financial settlements to many lawsuits against it as a result of traffic accidents; so that it will later be able to renew its activity as per the multiple objectives specified in the company by-laws," the board of directors said in its 2014 report.

With no income in 2014 and 2013, the summarised interim review conducted by public accountants Ibrahim Abbasi & Co. indicated that Trust International Transport sold its main route licences and bus terminals. 

A knowledgeable source told The Jordan Times that Trust International Transport was inoperative and that the buses were also sold because when route licences are relinquished, the buses must be given up as well.

Substantiating the information that the buses were sold, the balance sheet as of March 31, 2015, shows that the value of property and machinery at few thousand Jordanian dinars compared to JD0.9 million at the end of 2014.

Another source said present activities were frozen.

"There is no share for our company [Trust] in domestic competition due to the sale of the operating routes and, also, there is no share for our company in markets abroad because it currently does not function on routes from the Kingdom to outside Jordan," the company's annual report said.

"The company is posting annual and quarterly losses that have accumulated to more than 89 per cent of the capital," Ibrahim Abbasi & Co. said in the review, noting the losses at the end of this year's first quarter amounted to JD0.5 million, a JD0.4 million of which was loss from the sale of property and machinery. 

At the end of the first quarter of last year, the loss stood at JD0.1 million.

With accumulated losses at the end of March 31, 2015, totalling JD3.1 million, the JD3.4 million capital was considerably eroded bringing down shareholders' equity to JD0.5 million.  

"There are fundamental doubts casting negative shadow over the company's capability to continue as an independent ongoing concern unless it adopts a remedial action," the review added.

Besides trying to settle the compensation claims, the future plan includes diversifying its activities, meticulously continuing to control expenses and following up with the Land Transport Regulatory Commission to obtain licences for new routes, particularly international ones to Arab countries.     

"The company, in general, faces financial, credit and liquidity risks as well as market and capital management risks," the review said.

The auditor mentioned in a report that covered 2014 that it was not provided with the licences of some buses and, as such, it was unable to verify their ownership.

Moreover, the auditor remarked that the provision was not increased on JD42,530 of slow-moving inventory and said the company did not create a provision to guard against the risk of default on JD105,000 of net receivables and promissory notes that were due.

Other assets included JD0.3 million in cash at hand and at banks and JD0.25 million of additional receivables owed by Al Taif International Company for Renewable Energy, which is a wholly-owned subsidiary of Al Ekbal Investment Company.

According to the 2014 annual report, Al Taif International Company for Renewable Energy held  a 37.8 per cent stake in Trust International Transport at the end of last year from none in the previous year. 

At the end of 2013, a 38.4 per cent stake in Trust belonged to Al Ekbal whose equity in that company at the end of last year diminished to 0.6 per cent.

In both years, Bank of Jordan held a 9 per cent stake.

The annual report showed Trust's capital investment at JD3.9 million and that only 5 persons were employed at the company at the end of last year.