Construction services and property development company Boldtek Holdings 5VI 5VI says it expects to report a net loss and net liability position for the FY2023 ended June 30.
Boldtek says the losses were mainly due to its key subsidiary Logistics Construction being in the early stages of restructuring and having been granted a moratorium for a period of three months.
After conducting a review of Logistics Construction’s financial affairs in respect of restructuring, provisions were made on contract assets which had received final payments, were long outstanding or slow in payments, and for the reversal of contract assets to reflect lower amounts certified. In addition, the subsidiary has also seen fewer ongoing projects.
On Nov 19, Boldtek announced it had filed an application under Section 91 of the Insolvency, Restructuring and Dissolution Act 2018 (IRDA) for Logistics Construction to be placed under judicial management.
That same day, the company announced that it had entered into a non-binding term sheet with Malaysian businessman Ee Chin Keong to divest Logistics Construction.
Separately, Boldtek announced the sale of properties in its ordinary course of business on April 21 for which losses are expected to be recognised.
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Aside from Logistics Construction, which depends on further developments after filing for judicial management and the finalisation of its divestment agreement, Boldtek says it is able to continue operations through its wholly-owned subsidiary Boldtek Projects, which continues to operate and generate cash flows from ongoing operations.
Proceeds from the company’s sale of its Malaysia properties are also able to be utilised for operational engagement, says Boldtek.
Shares in Boldtek closed unchanged at 3.5 cents on Dec 12.
