Sinocloud's auditor report casts doubt on group's ability to continue as going concern

SINGAPORE - IT services provider Sinocloud Group's net loss position, dependence on borrowings and realisation of cash flows from current trade and receivables cast doubt on the firm's "ability to continue as a going concern", according to its auditors.

An extract released on Thursday (June 22) from an independent auditor's report noted that Sinocloud incurred a net loss of $42.2 million in the year ended March 31, and had cash amounting to $1.1 million, while liabilities came to $93.3 million.

The auditor noted that "the management has been taking efforts to improve the group's financial position".

It also said that the company had received 54 million yuan (S$11 million) on May 11 from the consideration for capital injection of an 18 per cent stake in Guiyang Zhongdian Gaoxin Digital Technologies.

The company was formerly known as Armada Group, and provides Internet data centre management services in China, primarily in the areas of mobile satellite services and internet data centre services.