Auditors raise doubts over Eversendai’s ability to continue as a going concern

• Messrs Baker Tilly Monteiro Heng PLT highlighted that the group incurred a net loss of RM366.86 million and that its current liabilities exceeded their current assets by RM168.33 million.
• This indicates that material uncertainties exist that may cast significant doubt on the group’s ability to continue as a going concern, according to Eversendai’s filing on Friday (May 5). 

KUALA LUMPUR (May 5): Eversendai Corp Bhd said its independent auditors have raised concerns about the loss-making construction firm’s ability to operate as a going concern in its audited financial statements for the year ended Dec 31, 2022 (FY2022). 

Messrs Baker Tilly Monteiro Heng PLT highlighted that the group incurred a net loss of RM366.86 million and that its current liabilities exceeded their current assets by RM168.33 million.

This indicates that material uncertainties exist that may cast significant doubt on the group’s ability to continue as a going concern, according to Eversendai’s filing on Friday (May 5). 

The group’s ability is dependent on the continuous support from financial institutions and the discussion on restructuring plans for the group’s borrowings being successfully concluded, as well as achieving sustainable and profitable operations or through the disposal of non-core assets to generate adequate cashflows for its operating activities. 

Eversendai said it expects its performance for FY2023 to be promising, as it is looking to secure more new projects. 

“We have already embarked on initiatives to enhance our bidding competitiveness. These will augment our business and operational resilience and help us deliver projects, in line with our customers’ needs and expectations. We believe that our focused efforts will drive better results for the group, moving forward,” it added. 

Eversendai posted a higher net loss of RM359.39 million for FY2022, versus RM137.08 million a year earlier. FY2022 revenue declined to RM897.93 million, from RM1.22 billion. 

Its accumulated loss ballooned to RM474.16 million as at end-2022. 

Eversendai, which has fallen 28.57% year-to-date, closed flat at 10 sen on Friday. Its market capitalisation stood at RM78.11 million.