No Signboard suspends trading; unable to show can continue as going concern

With a trading halt on Jan 19, the company's shares last closed flat at 3.1 cents on Jan 18. PHOTO: NO SIGNBOARD SEAFOOD/FACEBOOK

SINGAPORE (THE BUSINESS TIMES) - Catalist-listed seafood restaurant operator No Signboard Holdings requested a voluntary trading suspension on Monday morning (Jan 24) before the market opened, pending an announcement.

The company also said it is unable to demonstrate that it can continue as a going concern under the Singapore Exchange's (SGX) listing rules, in another filing on Monday.

With a trading halt on Jan 19, the company's shares last closed flat at 3.1 cents on Jan 18.

The company most recently announced on Jan 11 that it has terminated its subscription agreement with investor Henry Chandra Tjiang for a proposed placement of 77.8 million new shares amounting to $3.5 million.

In a statement on Sept 30 last year regarding the placement, the company said that the working capital of the group is sufficient considering its cash balances, present bank facilities and the net proceeds arising from the placement.

SGX has since filed queries to No Signboard, the group revealed.

This includes a request for its board of directors to provide an assessment of the group's ability to continue operating as a going concern and the bases for the assessment; its opinion on whether the company's shares should be suspended; and confirmation whether sufficient information has been disclosed to enable trading of the company's shares to continue in an orderly manner and the bases for its views.

In response to SGX's queries, No Signboard said that the proposed placement was one of the factors considered in preparing the unaudited financial statements for FY2021 on a going concern basis. Upon the termination of the proposed placement, the company and board have been in discussion with the substantial shareholders for financial support, it said.

"As the discussions are still ongoing and with the continued challenges in the operating environment of the local food and beverage industry (including the dining restrictions caused by Covid-19), the board has assessed that the company is unable to demonstrate that it is able to continue as a going concern," it said in response.

The group also revealed that it has about $3.7 million cash at bank. This includes the unutilised initial public offering proceeds of $2.9 million, of which $2.9 million has been earmarked by DBS Bank in respect of facilities drawn down, which includes an SME working capital loan and a temporary bridging loan aggregating about $2 million.

It is currently engaging DBS to release the earmarked amount for its working capital purposes, it said.

In the meantime, No Signboard has appointed Deloitte & Touche Financial Advisory Services as financial adviser to assist with the restructuring of the group. The company will continue to take steps to manage costs, through various cost-cutting and cost control measures.

It will also actively explore additional fund-raising activities, including possible financial support from its substantial shareholders as well as source for potential investment interest.

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