HupSteel Into The Red With FY15 Net Loss Of $8 Million

HupSteel Limited announced a FY15 net loss of $8 million, a massive plunge from the net profit of $3.7 million last year, due to write-down of inventories’ value, a goodwill written off and provision for doubtful debts.

Turnover experienced a 28.1 percent dive to $84.4 million due to sliding market demand from customers in shipbuilding, oil & gas sectors, brought by global economic slowdown and falling oil prices.

In 4Q15, the group decided to write off the goodwill of $4.6 million associated with the acquisition of the structural steel business as the evaluated net present value of future cashflow was unable to support the carrying value of net assets after taking consideration the dim outlook expected.

The group made a provision of doubtful debts of $1.9 million and a large proportion of the amount was provided against overseas customers. This provision contributed to the increase in other operating expenses and ultimately pulled the group into the red.

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