KUALA LUMPUR: Daya Materials Bhd shares have taken a hit, falling as much as 50% in early trade Friday after reporting a net loss for FY18 and concerns on its debt restructuring exercise.
The Practice Note 17 (PN17) company fell 50% to 0.5 sen. It is currently the most active counter with 16.11 million shares traded.
PublicInvest Research said Daya Materials reported a whopping RM158.5mil loss for FY18, slightly more than double FY17’s RM77.8mil loss as another round of impairments were undertaken.
The research house said its revenue was 0.9% lower year-on-year to RM290.7mil, reflective of the group still being operationally sound, albeit with gross profits more than halving to RM15.4mil in FY18 from RM39.8mil in FY17.
“With RM200.4mil borrowings coming due within the year, its regularisation plan is of great importance, now more than ever.
“Pending clarity and details on the plan, our target price/valuation continues to be placed under review with neutral call maintained,” it said, adding that earnings estimates were left unchanged at this juncture, but present significant downside bias.
Daya Materials had announced that it is currently facing two new legal cases with regard to defaults on loan repayment obligations.
PublicInvest said the finalisation of Daya Materials’ regularisation plan bears greater importance, now more than ever, given its RM246.12mil in borrowings as at Sept 30, 2018 which may or may not bring up further cases of such nature.
Daya Materials had recently applied for a 6-month extension (till August) to submit its regularisation plan.
Last month, Daya Materials announced its proposed regularisation plan that will see the entrance of a new major shareholder or white knight, who will hold some 20% of the company, should its debt restructuring plan go through.
The debt restructuring exercise would involve a proposed capital reduction exercise and a proposed rights issue of new shares with free detachable warrants, among others.