AusGroup’s auditors, KMPG LLP, have cited a material uncertainty related to whether the company can continue as a going concern, according to an extract of the comments filed to SGX by AusGroup Thursday.
KPMG pointed to AusGroup’s financial statements, which identified the carrying value of A$39.2 million of multi-currency notes as of end-June, with a maturity date of 3 December 2022, according to the filing.
The statements set out various fund-raising transactions necessary for the group to settle the notes when due, if the maturity date isn’t extended further, KPMG said.
“These fund-raising transactions include new proceeds from assets sale and/or business sale and/ or equity injection and/or additional debt financing facilities. As at the date of this report, none of these fund-raising transactions has reached conclusion with the relevant parties involved. As such, these conditions indicate a material uncertainty that the notes may not be settled when due,” KPMG said.
However, AusGroup said it prepared its financial statements on a going concern basis, despite acknowledging some uncertainty over whether it can finalize measures to repay the debt over the next 14 months.
The company noted the A$39.2 million notes have had their maturity date extended twice, and said options to meet the repayment include extending the repayment by agreement with the noteholders in 14 months’ time, re-financing the notes and/or repaying the notes with an equity injection and/or asset sale.
In addition, AusGroup pointed to its recent secured contracts.
“Due to the quantum of current secured contracts underpinned by a number of multi-year maintenance contracts across a diversified customer base, the group will be able to generate positive operating cash flows in the next 12 months from the reporting date,” AusGroup said. “The directors believe that the group will be able to meet its obligations as and when they fall due.”