KUCHING: Sealink International Bhd’s independent auditors, Messrs Grant Thornton Malaysia PLT, has issued an audit opinion with the existence of an uncertainty related to going concern of the company in view of the current economic conditions.
The auditor draws attention to Note 2 of Sealink financial statements for financial year ended Dec 31, 2022 (FY2022) which indicates that the group incurred net loss of about RM20.2 million during the financial year, and the total current liabilities of the group exceeded its total current assets by about RM49.9 million.
“These events or conditions indicate the existence of a material uncertainty which may cast doubt about the group’s ability to continue as going concern.
“The ability of the group to continue as a going concern is dependent on attaining future profitable operations of the group and the continue financial support from a major corporate shareholder of the company. Our opinion is not modified in respect of this matter,” it said.
On impairment of vessels, the auditor said the carrying amount of the group’s vessels might exceed their recoverable amounts and therefore the carrying amount had to be impaired.
The recoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use.
“We have identified the carrying value of the group’s vessels as a key audit matter because of its significance to total assets in the consolidated financial statements and the estimation of recoverable amount involved a significant degree of judgement and assumptions made by the group such as estimated fair value of the vessels as provided by an external valuer and estimated future cash flows for value-in-used which includes the assumptions on utilisation rates, disposal values, charter hire rates and discount rates applied,” it added.
Miri-based Sealink said 2022 had been a year of commendable growth for the group with its revenue surging by about 72 per cent (from RM37.96 million in 2021 to RM65.3 million in 2022). The group’s net group was reduced to RM20.2 million from RM65.4 million in 2021.
“The group successfully secured several long-term charter contracts and witnessed a surge in utilisation rates and average charter rates. The group has also successfully grown its customer base over the past year. This is evidenced by the significant growth in operational performance.
“The group expects FYE 2023 to be promising and is looking forward to secure more new charters. We have already embarked on initiatives to enhance our bidding competitiveness. These will augment our business and operational resilience and help us deliver projects in line with our customers’ needs and expectations.
“We believe that our focused efforts will drive better results for the group moving forward,” added Sealink, whose core business is chartering of vessels and ship building and repair activities.
