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Stamford Tyres warns of net loss for FY2020
MAINBOARD-listed Stamford Tyres said in a regulatory update on Thursday evening that it is expecting to book a net loss for FY2020 ended April following a preliminary review of its draft unaudited financial results.
The losses were primarily attributable to lower revenue arising from increased competition and oversupply in the tyre market, as well as a one-off expense relating to the closure of a loss-making operation in Australia in the second quarter.
The company is also expecting higher allowance for doubtful receivables as a result of either delayed and unpaid trade receivables from its customers due to the various government-imposed lockdowns in key markets such as Malaysia and Thailand on the back of the ongoing Covid-19 pandemic.
It said it is still finalising its financial results for FY2020, and added that further details of its financial performance will be disclosed upon announcement of its results on or before July 29.
Last December, the company had sounded similar warnings about booking a net loss for both Q2 and H1 ended Oct 31, 2019.
For FY2019, Stamford Tyres reported a 90.9 per cent plunge in earnings to S$474,000. This was due partly to a 5.4 per cent decline in revenue to S$229.4 million on the back of lower sales in the company’s South-east Asia and North Asia markets.
This had also resulted in the company’s earnings per share for the year falling to 0.2 Singapore cents from 2.2 Singapore cents in FY2018.
Shares in Stamford Tyres closed unchanged on Thursday at S$0.166.