Nine have less than a year to apply for removal, most are still not profitable. By Joyce Hooi
Slightly more than a year after the Singapore Exchange (SGX) introduced its watch-list, the question of the future of the firms on the list has arisen among shareholders.
Nine of the 17 firms on the list have less than a year to apply for removal from it - or risk being delisted after the deadline.
The nine firms were added in March last year at the start of watch-list initiative, which lists mainboard firms that post pre-tax losses for their three latest completed consecutive years and have average daily market capitalisation of less than $40 million for the past 120 trading days.
Firms on the watch-list face being delisted if they do not successfully apply to be removed from the list within 24 months.
The outlook for most of the nine companies does not look promising as far as removal from the list is concerned.
With less than a year to go before the deadline to apply for removal is up, five of the nine firms have recorded pre-tax losses for their latest full financial year ended Dec 31, 2008. Of these five firms, three have also been flagged over going-concern issues by auditors in recent months.
Only one of the nine firms - Unified Communication Holdings - recorded a pre-tax profit for its latest full financial year - of $2.7 million.
Stratech Systems, another firm on the list, posted a gross profit of $7 million for the nine months ended Dec 31, 2008, while another company, Fastech Synergy, posted a US$54,000 pre-tax profit for the first quarter of its financial year ended March 31, 2009, after recording a pre-tax loss of US$1.5 million for the full year ended Dec 31, 2008.
Removal from the watch-list is dependent on a company posting of a pre-tax profit for its latest full financial year and getting its average market capitalisation for the past 120 market days back up to $40 million or more.
The two latest additions to the list are Informatics Education and Ocean International Holdings, which were added in March this year.
So far, SGX has remained silent on whether it will extend the grace period or relax the conditions for removal from the list, given the economic downturn.
‘It would be good if SGX were to state a clear position with regard to these watch-list stocks, as investors like me need to know whether these companies will be delisted when the two-year time frame is up,’ said a shareholder of a company on the list. ‘Given the financial crisis that has affected most companies worldwide, it is my hope that SGX will give an extension to this deadline.’
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SGX watch-list firms running out of time
Nine have less than a year to apply for removal, most are still not profitable. By Joyce Hooi
Slightly more than a year after the Singapore Exchange (SGX) introduced its watch-list, the question of the future of the firms on the list has arisen among shareholders.
Nine of the 17 firms on the list have less than a year to apply for removal from it - or risk being delisted after the deadline.
The nine firms were added in March last year at the start of watch-list initiative, which lists mainboard firms that post pre-tax losses for their three latest completed consecutive years and have average daily market capitalisation of less than $40 million for the past 120 trading days.
Firms on the watch-list face being delisted if they do not successfully apply to be removed from the list within 24 months.
The outlook for most of the nine companies does not look promising as far as removal from the list is concerned.
With less than a year to go before the deadline to apply for removal is up, five of the nine firms have recorded pre-tax losses for their latest full financial year ended Dec 31, 2008. Of these five firms, three have also been flagged over going-concern issues by auditors in recent months.
Only one of the nine firms - Unified Communication Holdings - recorded a pre-tax profit for its latest full financial year - of $2.7 million.
Stratech Systems, another firm on the list, posted a gross profit of $7 million for the nine months ended Dec 31, 2008, while another company, Fastech Synergy, posted a US$54,000 pre-tax profit for the first quarter of its financial year ended March 31, 2009, after recording a pre-tax loss of US$1.5 million for the full year ended Dec 31, 2008.
Removal from the watch-list is dependent on a company posting of a pre-tax profit for its latest full financial year and getting its average market capitalisation for the past 120 market days back up to $40 million or more.
The two latest additions to the list are Informatics Education and Ocean International Holdings, which were added in March this year.
So far, SGX has remained silent on whether it will extend the grace period or relax the conditions for removal from the list, given the economic downturn.
‘It would be good if SGX were to state a clear position with regard to these watch-list stocks, as investors like me need to know whether these companies will be delisted when the two-year time frame is up,’ said a shareholder of a company on the list. ‘Given the financial crisis that has affected most companies worldwide, it is my hope that SGX will give an extension to this deadline.’
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