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Kitchen Culture sees 11.6% rise in net loss between audited, unaudited FY19 results

THE audited net loss of Kitchen Culture for FY2019 was 11.6 per cent higher than that in its unaudited results, partly due to write-offs in inventories and bad debt, according to a bourse filing by the Catalist-listed company on Sunday. 

In its unaudited results for FY2019 ended June, Kitchen Culture had announced a net loss of S$3.7 million, on the back of revenue of S$10.5 million. But in its audited results, the net loss was steeper at S$4.12 million, even as revenue was slightly higher at S$11 million. 

The bottomline was hit partly by a rise in other operating expenses from over S$211,700 in the unaudited results, to over S$825,200 in the audited figures. This was due to over S$283,900 in inventories written off, additional bad debts written off of over S$145,000 and a net allowance for doubtful debts of over S$102,600, Kitchen Culture said in its filing. 

The discrepancy in operating expenses was also due to an additional foreign exchange loss of over S$91,500, an unrealised foreign exchange loss of over S$16,100 and an allowance for inventories' write-down of over S$36,500. This was partly offset by a reversal of the S$62,426 provision for defect liability made in the prior year.

The slight increase in Kitchen Culture's audited revenue was mostly due to the recognition of additional distribution and retail revenue of S$381,053 for goods delivered but not invoiced as at the end of the financial year. The firm also recognised additional income from residential projects of S$122,121, from late certification by the main contractor for work done.

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With the increase in losses, Kitchen Culture's net cash generated from operations was 10.6 per cent lower in its audited results, at S$915,297.

The company also recorded several discrepancies on its balance sheet. Its audited cash holdings of over S$333,600 was 32.5 per cent higher than the unaudited figure due to the reclassification of a bank overdraft of S$98,036 to borrowings.

Meanwhile, net current liabilities decreased 37.5 per cent in the audited results, due to the reclassification of S$1.6 million of borrowings from current to non-current liabilities. This was done given written commitments from certain lenders not to demand payment in the next year, as well as a reclassification of S$500,000 of trade receivables from non-current to current assets.

Shares of Kitchen Culture closed flat at S$0.081 on Friday.

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