LYC Healthcare Berhad’s independent auditors have issued a disclaimer of opinion on the group’s financial statements for the year ended 31 March 2025, citing significant uncertainties over the company’s ability to continue as a going concern and a lack of sufficient audit evidence for a disposed subsidiary.
In their report, the auditors said they could not express an opinion because of two major issues:
The group posted a net loss of RM12.22 million, while the company recorded a deeper loss of RM15.88 million. As at 31 March 2025, the group’s current liabilities exceeded current assets by RM63.52 million.
The auditors noted that redeemable preference shares worth RM56.19 million will mature in September and October 2025. While extensions to September and October 2026 have been agreed in principle, they remain subject to dividend settlements and formal documentation.
Adding to the strain, LYC was classified in June 2025 as an affected listed issuer under Bursa Malaysia’s Guidance Note 3 after its shareholders’ equity fell to RM25.36 million — just 25% or less of its paid-up capital. The company must now submit and implement a regularisation plan within the stipulated timeframe.
The auditors said they were not provided with a 12-month cash flow forecast to assess management’s going concern assumptions, and there is insufficient information on how the proposed regularisation plan would address the financial conditions.
The auditors were also unable to obtain full access to the financial records of Elite Dental Team Sdn Bhd, a 55%-owned subsidiary disposed of on 31 December 2024.
In the report they noted that Elite Dental contributed RM15.55 million in revenue — about 10% of the group’s total — and RM633,878 in profit after tax during the financial year. However, the auditors could not verify the accuracy and completeness of certain expenses before the disposal, leaving uncertainty over whether adjustments to the group’s consolidated accounts were needed.
In December 2024, LYC announced plans to list its Singapore-based operations on the Nasdaq Capital Market, aiming to raise between USD5 million and USD15 million. The success of this exercise, alongside the regularisation plan, will be crucial to the group’s financial recovery.
The auditors stressed that the appropriateness of preparing the accounts on a going concern basis hinges on the viability, approval, and execution of the regularisation plan, as well as the group’s ability to restore sustainable operations and meet obligations as they fall due.
