China Energy's independent auditors flag concerns over financial position

The independent auditors of China Energy, a Singapore-listed producer of dimethyl ether, have flagged concerns about the group's financial position.

In an "emphasis of matter" opinion, auditors Moore Stephens noted that China Energy's current liabilities exceeded its current assets by 1.5 billion yuan as at Dec 31 last year, up from 991.5 million yuan the year before.

The group also incurred a net loss of 277 million yuan last year.

These conditions " indicate the existence of a material uncertainty which may cast significant doubt as to the ability of the Group to continue as a going concern", the auditors said.

China Energy has 705 million yuan in outstanding short-term bank loans and 1.46 billion yuan in bills payables that are due this year.

"Management has held discussions with its bankers and no matters have been drawn to its attention to indicate that these banks intend to terminate their existing banking relationships with the group," Moore Stephens said.

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