E.A. Technique's auditor flags doubt about ability to continue as going concern

KUALA LUMPUR (May 18): E.A. Technique (M) Bhd, a Practice Note 17 (PN17) company, said its external auditor Messrs Ernst & Young PLT (EY) has expressed a disclaimer of opinion in its audited financial statements for the financial year ended Dec 31, 2021 (FY21).

According to E.A. Technique's bourse filing on Wednesday (May 18), EY had pointed to the group's and the company's reported net loss of RM150.6 million and RM161.2 million respectively for FY21. It also noted that at end-December 2021, the group’s and the company’s current liabilities exceeded their current assets by RM405.3 million and RM416.9 million respectively, but the group and the company only had cash and bank balances of RM6.4 million and RM5.5 million respectively.

"These events and conditions indicate the existence of material uncertainty that may cast significant doubt on the group’s and the company’s ability to continue as a going concern," said EY.

Nevertheless, E.A. Technique highlighted that it is currently in the process of formulating a proposed regularisation plan for submission and has approximately 10 months to submit it to Bursa Malaysia and/or other relevant regulatory authorities.

It added that the proposed regularisation plan will include debt restructuring. It will also explore the option to adopt an asset light strategy, which involves reduction in its aging vessels while maintaining younger vessels, as well as a proposed debt equity swap.

E.A. Technique shares closed down 0.5 sen or 11.11% at 4 sen on Wednesday, bringing it a market capitalisation of RM21.22 million.