KARACHI: Pakistan Steel Mills (PSM) achieved 24 per cent average capacity utilisation (CAPU) in January 2015 while it was just 7.7pc in June 2014 when it received first tranche (Rs12.5 billion) of the Rs18.5bn bailout package.

This was stated by BMR and P&S Acting Principal Executive Officer Absar Nabi during a conference of suppliers at Metallurgical Training Centre Bin Qasim on Thursday.

He revealed that before the bailout package the mill’s average CAPU was just 3.5pc during Jan-April 2014.

He said the bailout package was to be released in three tranches; first during May-Aug 2014 to achieve 30pc CAPU; second (Rs3bn) during Sept-Nov 2014 to achieve 60pc CAPU and third (Rs3bn) during Dec-Jan 2015 to achieve 77pc CAPU.

However, he said, the first tranche was released in June instead of May last year, thus iron ore was received in September which pushed first month of production target of 20pc to October 2014 and break-even (77pc) to April 2015, a delay of three months from the original plan.

He claimed that the bailout package would help in reduction of losses by Rs9bn in 2014-15 and by Rs20bn in the 2015-16.

Despite the package and achieving the CAPU, over 15,000 employees are awaiting to get their four months (Nov-Feb 2015) salary.

PSM Spokesman Shazim Akhtar said the wage bill per month is Rs480 million, followed by Rs800m utility bills for which PSM had already sought Rs4.5bn from the government.

Published in Dawn, February 27th, 2015

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