On back of allowances made for its Dalian business.
King Wan Corporation (KWC) booked a net loss of $5.86m in 3QFY16, compared to profits of $900,000 in the corresponding quarter in FY15.
According to the company’s announcement, KWC saw improvements thanks to higher gross profits achieved in Q3. This, in turn, was on back of a spike in turnover, strengthened contributions from associates, and collection of debts that were previously provided for.
However, these increases were offset by an allowance made in relation to KWC’s real estate development business in Dalian, China. As the depressed real estate in Dalian persisted, KWC made allowance for doubtful receivables due from its associate Dalian Shicheng Property Development (DLSC) amounting to an aggregate of $8m. Additionally, an allowance of $12m was made for amounts due from DLSC in the last financial year.
Meanwhile, net cash from operating activities amounted to $1.58m. Net cash in investing activities amounted to $6.95m on back of higher loans extended to KWC’s associates during the quarter. Also, net cash from financing activities reached $1.42m during the quarter.
KWC asserts that no interim dividends were paid out in the current quarter and there were also tapered proceeds from bank borrowings compared to the 3Q15.
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