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8Telecom narrows FY2017 net loss to S$1.5m on higher revenue from subsidiary
MAINBOARD-listed 8Telecom International Holdings managed to narrow its full-year net loss to S$1.5 million for fiscal year 2017, from a net loss of S$27.3 million in the year-ago period. This came on the back of higher revenue from its subsidiary, Arete M.
Loss per share stood at 1.91 Singapore cents, from a loss per share of 27.03 Singapore cents last year.
No dividend has been declared for the current financial period, unchanged from the preceding year.
For FY2017, the group's revenue surged to S$727,000 from S$11,000 in FY2016. This was mainly attributed to more projects being secured by subsidiary Arete M, a home-grown infocomm services company.
While selling expenses decreased by 67 per cent to S$57,000 during the year, administrative expenses surged by 79 per cent to S$2.42 million.
This was due to the business expansion of Arete M, and the group's exploration of new business opportunities including investing in a new office, hiring more staff and engaging more professionals for advice, 8Telecom said in a filing to the Singapore Exchange (SGX) on Wednesday.
As at Dec 31, total assets stood at S$2.77 million, while total liabilities amounted to S$7.04 million. Total liabilities rose 78 per cent from last year, mainly due to loans took on by Arete M during the financial year, the group said.
Going forward, while 8Telecom remains committed to assist Arete M in securing sufficient capital to support its future growth, it has also been exploring new businesses to increase its revenue streams.
"In the event that the company continues to be unable to secure new financing to support Arete M's growth plan so that it becomes profitable, the board may consider disposing Arete M," the group said.
On March 8, the firm entered into a conditional sale and purchase agreement with Letu Investments and New Pacific Trading to acquire 51 per cent of the issued and paid-up share capital of China Commodity Market and China Commodity Shopping Centre.
As the proposed acquisition represents a diversification from its telecomm infrastructure solutions business into the retail business, the board intends to seek the approval of shareholders at a special general meeting to be convened.
Shares in 8Telecom last traded at 8.3 Singapore cents apiece on Tuesday, unchanged from the previous day's close.