Walcom fails to secure loan from CEO, warns of liquidation
By Iain Gilbert
Date: Monday 15 Jun 2020
(Sharecast News) - Animal feed group Walcom warned on Monday that it could very likely go into liquidation after having failed to secure a loan from its chief executive.
Walcom cautioned that based on its current cash flow projections the firm would only be able to continue operations until 19 June, when a bank loan that had already been extended from the end of May falls due.
"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," said the group.
In terms of recent trading, Walcom said full-year revenues were expected to have more than halved to HK $15.1m (£1.55m) due to an outbreak of African swine flu in China.
While the AIM-listed company has seen a gradual recovery of the swine market in China, the quantity of goods per order was now smaller than before.
"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," said Walcom.
As of 0915 BST, Walcom shares had sunk 40% to 0.15p.
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