Company Provides Updates Amid Ongoing Independent Review and Financial Adjustments
KTL Global, a company currently under voluntary suspension, has announced that its ongoing independent review is expected to take between three and five months. The review was initiated following questions raised by the Securities Investors Association (Singapore) regarding the group’s FY2020 annual report. The independent reviewer, Deloitte & Touche Advisory Services, was appointed in mid-August, and trading of the company’s shares, which have been suspended since August 17, will not resume until the review concludes.
The review follows concerns raised by KTL’s independent auditors, who issued a disclaimer of opinion on the group’s financial transactions with Bluegas, a subsidiary involved in dealings with four branding, operation, and procurement customers in China. Among the issues identified were irregular accounting practices, including discrepancies related to a US$700,000 (S$944,000) receipt from the Lawrence Group.
In response to these issues, KTL clarified that it ceased operations with Bluegas in January, primarily due to Covid-19 and disruptions in China. The company confirmed it retained possession of all legal documents and company seals from Bluegas.
Additionally, KTL described Bluegas as an asset-light business, requiring no significant capital expenditure or inventory. The board oversaw the business through ad-hoc communications, with Bluegas’s former CEO, Liu Changsheng, providing updates until his resignation on July 31, 2021. Since his departure, KTL has had no formal relationship with Mr Liu, although he remains open to assisting the group regarding Bluegas-related matters.
As the review progresses, KTL also disclosed its efforts to strengthen its financial position. The group highlighted its intention to raise funds and seek new revenue-generating opportunities. These efforts include the establishment of a new subsidiary focused on investment holdings and logistics, securing a loan facility of up to S$2 million, and plans to acquire a fresh vegetable and fruit producer. Furthermore, KTL is exploring a proposed placement to raise up to S$3.1 million from investors.
KTL has also been pursuing a variety of new business ventures, including entering the lab-grown diamond industry and expanding into the fish and seafood import market in Singapore. These new initiatives, alongside the company’s fresh produce business, are expected to become key drivers of growth and profitability, contributing to the long-term value for shareholders. An advisor with significant expertise in the food industry has been appointed to support the company’s expansion into these sectors.
KTL’s shares were last traded at 11.6 cents on August 6, before the suspension began, and the company remains optimistic that its new business strategies will help strengthen its financial outlook.
