KUALA LUMPUR (Sept 30): The independent auditor of Marine & General Bhd (M&G) has issued an unqualified opinion with material uncertainty related to its ability to continue as a going concern.

In a bourse filing on Thursday, Messrs KPMG PLT drew attention to the group’s net loss of RM218.88 million for the financial year ended April 30, 2021 (FY21), when the current liabilities of the group and company exceeded its current assets by RM18.64 million and RM56.48 million respectively.

“These events and conditions, along with other matters as disclosed in Note 1(b), indicate that material uncertainties exist that may cast significant doubt on the ability of the group and the company to continue as going concerns,” said the auditor.

The key audit matters are impairment of vessels, accounting for debt restructuring and impairment of investments in subsidiaries.

M&G said it had already started the process of addressing the net current liabilities by negotiating for a financing repayment moratorium with its lenders for a period of up to nine months, which would enable the group to reduce its current liabilities by RM31 million and assist the group to meet its other obligations and plans for the next financial year.

It added that it will continue to focus on cost optimisation and stringent cash flow management, while at the same time maintain safety and quality services to remain competitive.

For the fourth quarter ended April 30, 2021 (FY21), the group’s net loss narrowed to RM9.72 million, from RM18.01 million a year ago, mainly attributable to reversal of vessel impairment loss. Quarterly revenue, meanwhile, decreased to RM41.64 million from RM54.91 million on lower charter activity of both its upstream and the downstream divisions due to the adverse impact of the Covid-19 pandemic which continued to suppress demand for oil and its derivative products.

For the full FY21, it posted a net profit of RM10.16 million, versus a net loss of RM49.63 million a year earlier, despite lower revenue. Full-year revenue declined to RM183.4 million from RM213.6 million previously.