Silver Bird March 2012

The suspension of the trio was to facilitate an internal probe into allegations of irregularities in the company’s accounts. Its board said it is currently unable to ascertain the extent of the financial and operational impact of the alleged irregularities but estimates exposure to be approximately rm115 million. Additionally, Silver Bird’s board has lodged a police report in relation to the financial irregularities and reported the matter to the regulatory authorities.

The company is classified as PN1 and PN17 counter. Silver Bird’s major subsidiaries were in default of baking facilities repayments of about rm10 million., with the group currently unable to provide a solvency declaration to Bursa .

Its auditor had expressed concern on right main issues including a rm10.6 million contract, payments to rm69 million and common parties’ relationships between the group’s customers and suppliers. The auditors had also pointed out that the credit period for trade receivables appeared to be unusually high and that the cash collected and payment made were cleared by the banks after more than seven days from the balance sheet date.

Now that Silver Bird is an affected listed issuer, it will have to submit a regularization plan to the authorities, failing which its shares and warrants will be suspended from trading and subsequently delisted. It intends to formulate a regularization plan to address its PN17 status.

Its net assets per share stood at 52 sen. However as at Oct 31, 2011 its cash and stood at rm3.55 million. Its board warned that there may be bad debts and additional allowances that may need to be made for impairment losses on receivables.

To recap, on Feb 24, 2012 Silver Bird announced to Bursa Malaysia that it was unable to meet the deadline to issue it its annual audited financial statements as it would need more time to resolve queries raised by its auditors.

The group had to submit its annual audited financial accounts on or before Feb 29, 2012 as it marked the last day of the four month time frame from the close of its financial year on Oct 31, 2011 to issue the audited results.

Silver Bird said it expected to complete the process with its auditors and issue its annual audited financial statements on or before May 31, 2012.

LTH is Silver Bird’s largest single shareholder by virtue of its 22.19% stake. Its substantial shareholder include BJCorp with 20.53% stake, Koperasi Permodalan Felda Malaysia Bhd controlling 12.7% stake and CVC Ltd holds 9.07%. Tan, meanwhile holed a 10.64% stake and his wife Datin Ong holds 1.99% stake. Tan also holds 12.42% warrants as at March 4, 2011.

Despite the latest developments at Silver Bird, market observers say the group’s core business remains intact.

Silver Bird’s net profit for FY2011 rose to rm4.93 million where revenue grew to rm613 million.