The information contained within this
announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 ("MAR").
WALCOM GROUP LIMITED
(“Walcom” or “the Company”)
The Board of Walcom provides an update on revenues for the year
ended 31 December 2019, current
trading and its working capital position.
The Company has announced previously that its operations during
the 2019 financial year were adversely affected by the effects of
African Swine Influenza on customer orders in its key market of
China. As a result, the Board of the Company currently
anticipates that revenues for the year ended 31 December 2019 will be approximately
HK$15.1m (2018: HK$34.7m), though the Company’s results remain
subject to audit.
The Company has seen a gradual recovery of the swine market in
China, whereby most of its
customers have re-commenced ordering the Company’s swine feed
products. Whilst the quantity per order is smaller than before, the
Company has observed a trend of more regular orders from customers.
The Board is cautiously optimistic that sales of swine products in
China will continue and hopefully
accelerate during the fourth quarter of the current financial
Due to the combined effect of African Swine Influenza and
COVID-19, Walcom has experienced a significant reduction in sales
of its products in markets outside China which the Board expects will continue
until the final quarter of the current financial year.
The Company continues to develop its products for dairy cows in
China, and the Board anticipates
that sales of these products will begin during Q4 2020.
Working Capital Position
Mr Francis Chi, Chief Executive
of the Company, has still been unable to provide the proposed loan
of HK$1,230,000 (the “Director Loan”)
to the Company as intended. Mr Chi has, again, reiterated his
intention to provide the Director Loan but there can be no
certainty as to the provision or the timing of the Director
Further to the announcement on 5 June 2020, the
Company has extended its payment plan with its
bank in relation to a loan which was due for repayment at
the end of May 2020. Under the
revised payment scheme, the Company is required to
repay RMB150,000 by 19 June
2020, with a further six monthly instalments of
RMB50,000 being payable commencing in
The Company will require additional funding
to satisfy the loan repayment due on 19 June 2020. Therefore, based
on Walcom’s current cash flow projections, the Company
will be able to continue operations until 19 June 2020.
In the absence of the Director Loan now being received in part or
in full by this date, the Company would be unable to continue
its operations and would be forced into liquidation with a
consequential diminution in value to shareholders.
Further announcements will be made in due course.
|Walcom Group Limited
Francis Chi (Chief Executive Officer/Chief Financial Officer)
|+852 2494 0133
|Allenby Capital Limited (Nominated Adviser and
David Hart / Asha Chotai
|+44 20 3328 5656