mm2 Asia's auditor notes material uncertainty over ability to continue as going concern

ENTERTAINMENT group mm2 Asia's independent auditor has noted a material uncertainty regarding the group's ability to continue as a going concern, in view of the latest financial year's net loss and its liabilities exceeding assets, the mainboard-listed firm said in a Singapore Exchange filing on Tuesday night.

The observation is part of Messrs Nexia TS Public Accounting Corporation's unmodified audit opinion in its report on the group's audited financial statements for the year ended March 31, 2021. The auditor's opinion remains unqualified.

mm2 Asia advised shareholders to read the audited financial statements in full as set out in its annual report, which will be available on its website and SGXNet before July 15.

In its report, the auditor drew attention to the group's net loss of S$99.5 million, compared to its net profit of S$6.3 million the year before, as well as its current liabilities exceeding current assets by S$119.5 million.

These conditions "indicate that a material uncertainty exists that may cast significant doubt on the group's ability to continue as a going concern", said the auditor.

In the release of its unaudited accounts in May, mm2 Asia noted that the Covid-19 pandemic had severely hit its major businesses in movie-making and film distribution. But it noted signs of a rebound and said it had a pipeline of core projects valued at S$80.7 million, offering earnings visibility up to FY2022.

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mm2 Asia shares closed up 0.2 Singapore cent or 2.53 per cent at 8.1 Singapore cents on Tuesday before the announcement.