1. Introduction

The Board of Directors of Country Heights Holdings Berhad (“CHHB” or “the Company”) wishes to announce that the external auditors, UHY Malaysia PLT [Registration No. 202406000040 (LLP0041391-LCA) & AF 1411], have included a paragraph on Material Uncertainty Related to Going Concern (“MUGC”) in their Independent Auditors’ Report on the financial statements of the Group and the Company for the financial year ended 30 June 2025.

The auditors’ report, dated 28 October 2025, contained an unmodified opinion, but drew attention to the existence of a material uncertainty which may cast significant doubt on the Group’s and the Company’s ability to continue as going concerns.

 
2. Details of the Material Uncertainty

The auditors drew attention to Note 2(d) of the financial statements, which states that:
 

(i)   The Group and the Company incurred net losses of RM45.52 million and RM286.80 million respectively for the financial period ended 30 June 2025;

(ii)   As at that date, the Group’s and the Company’s current liabilities exceeded current assets by RM27.27 million and RM526.33 million respectively; and

(iii)  Both the Group and the Company have incurred losses for three consecutive financial periods.

These conditions indicate the existence of a material uncertainty that may cast significant doubt on the Group’s and the Company’s ability to continue as going concerns. The auditors, however, did not modify their opinion in respect of this matter.

3. (a) Key Audit Matter Disclosed in the Auditors’ Report

Apart from the MUGC, the auditors have also highlighted a Key Audit Matter (KAM) relating to impairment on trade receivables, amounting to RM10.19 million as at 30 June 2025. The KAM addresses the inherent judgment and uncertainty involved in determining recoverability and the adequacy of impairment allowance.

3. (b) Steps Taken or Proposed to Address the Material Uncertainty and Key Audit Matter

The Board and management have implemented and will continue to implement the following measures to address the material uncertainty and strengthen the Group’s financial position:

(i)  Ongoing cost-rationalisation initiatives and streamlining of operations to improve efficiency   and reduce overheads;
(ii)  Active asset realisation and disposal of non-core properties and investments to generate liquidity;
(iii) Fund-raising exercises, including private placements, rights issues, and strategic partnerships to strengthen working capital;
(iv) Debt-restructuring and refinancing efforts through continuous engagement with bankers and creditors; and
(v)  Enhanced credit-control measures to improve collection of trade receivables and mitigate further impairment risk.

3. (c) Timeline for the Above Steps

The Board targets to execute and achieve measurable progress on the above initiatives within the next 12 to 18 months, aligning with the Group’s strategic restructuring and capital-management plans for the financial years, ending 30 June 2026 and 2027.

 
4. Board’s Opinion

After careful consideration of the auditors’ statement and the current plans in place, the Board of Directors is of the opinion that the Group and the Company will be able to continue as going concerns for the foreseeable future. The financial statements of CHHB for the period ended 30 June 2025 have therefore been prepared on a going-concern basis.

 
5. Conclusion

This announcement is made pursuant to Paragraph 9.19(37) of the Bursa Malaysia Securities Berhad Main Market Listing Requirements.

Date of Announcement: 31 October 2025