GP Industries flags full-year net loss of $58m-$68m after non-cash impairment
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GP Industries noted a significant improvement in its operating earnings for financial year 2024 on improved gross profit margin and effective cost control measures.
PHOTO: BT FILE
Vivienne Tay
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SINGAPORE – Battery maker GP Industries expects to record a net loss of between $58 million and $68 million for the financial year ended March 31, compared with a net profit of $22 million for the previous fiscal year.
The group attributed the plunge into the red to its share of attributable loss, including impairment losses for XIC Innovation, one of its industrial investments.
As the loss is non-cash in nature, it will not have a substantial adverse impact on GP’s current and future operating cash flow and future operating earnings, the group said in a profit guidance on May 27.
GP said XIC Innovation and some of its subsidiaries had received winding-up petitions filed by a bank in the High Court of Hong Kong, but they maintain and continue their business operations with the support of their major customers and suppliers.
XIC Innovation has also engaged a financial adviser to prepare and evaluate its restructuring programme.
This includes exploring potential new funding from third parties to provide a runway to continue its business operations.
The group is projecting its share of the impairment loss of XIC Innovation to be between $71 million and $77 million, as it holds an effective 39.13 per cent equity interest.
As of March 31, GP no longer has significant influence over XIC Innovation, so it no longer uses the equity method to account for XIC Group’s results.
Excluding its share of attributable loss on XIC Innovation, GP would have made a net profit of between $16 million and $18 million for financial year 2024.
The group also noted a significant improvement in its operating earnings for financial year 2024 on improved gross profit margin and effective cost control measures. It expects its profit before finance costs and share of associates’ results for the fiscal year to range between $53 million and $55 million versus the $35.1 million recorded for the previous corresponding period.
It will release its unaudited financial results for financial year 2024 by May 30.
Shares of mainboard-listed GP ended 0.5 cent, or 1 per cent, higher at 52.5 cents on May 27. THE BUSINESS TIMES
