LONDON (ShareCast) - (Sharecast News) - Animal feed outfit Walcom told investors on Wednesday that it was yet to receive a RMB 4.96m (£556,000) payment from its largest customer, leading it to commence legal proceedings against the buyer in order to recover the funds.
In addition to the legal drama with its unnamed client, Walcom said the African swine fever epidemic which has affected most provinces in China, including those in which it operates, has had an "adverse effect on trading".

The AIM-listed firm now expects full-year revenues to be "significantly lower than the previous financial year".

"This reduction in revenue, in conjunction with the impact of the default on payments owed by the customer, are likely to lead to the company's loss before tax for the current financial year being significantly higher than that for the 2017 financial year," said Walcom.

Walcom also noted that its working capital position was "significantly restrained but manageable in the near-term.

However, if Walcom is unable to recover the full amount outstanding from its mystery customer or secure an alternative financing arrangement with its lenders, it warned that it may soon be in a position where it would be unable to settle its liabilities.

As of 1300 GMT, Walcom shares had dived 33.33% to 0.25p.

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