Lion Industries Corporation Bhd (LICB) said its independent auditors have issued an unqualified audit opinion with a material uncertainty related to going concern for the group’s audited financial statements covering the 18-month period ended June 30, 2026.
LICB said Forvis Mazars PLT highlighted the group’s weak financial position, including a net loss of RM211 million and net operating cash outflow of RM10 million during the period.
At the company level, LICB recorded a net loss of RM117 million and operating cash outflow of RM7 million, while its net current liabilities stood at RM144 million as at June 30.
The auditors said the group had subsequently obtained approval from a lender to reschedule repayment of a RM33.5 million term loan and extend the facility tenure to Dec 31, 2027.
While the restructuring reduces near-term repayment pressure, the auditors said LICB’s ability to maintain sufficient liquidity and meet its obligations remains dependent on the successful execution of proposed asset disposals, rationalisation and monetisation initiatives, as well as cost optimisation and operational efficiency measures.
The auditors also noted that neither the group nor the company had any undrawn committed banking facilities available to provide additional liquidity as at the date the financial statements were approved.
LICB’s proposed asset disposal and monetisation plans are at different stages of evaluation and negotiation and remain subject to definitive agreements, regulatory approvals, shareholder approvals where applicable and prevailing market conditions.
The auditors said these factors create a material uncertainty that may cast significant doubt on LICB’s ability to continue as a going concern.
However, the audit opinion itself was not modified, meaning the auditors did not qualify the financial statements despite drawing attention to the going-concern uncertainty.
LICB added that none of the key audit matters disclosed in the independent auditors’ report related to the going-concern issue.
