WALG Walcom Group Limited

3 July 2019

WALCOM GROUP LIMITED
(“Walcom” or “the Company”)

Company update

Further to the Company’s announcement on 4 June 2019, the Company provides the following update.

As previously announced, the African swine fever in China has impacted Walcom’s trading performance in the first six months of the current financial year. There has been no easing in the prevalence of the disease, which the Company believes is still spreading in China.  As a result, the Board believes there will be no significant improvement in trading conditions until the final quarter of this year.  Importantly, the Company continues to work with its existing customers and it has not lost any major customers to competitors. The Company continues to work on increasing its customer base and customer penetration within the poultry feed sector and is hopeful the Company will see the benefit of this in the latter part of the year.

The Board continues to expect that the Group will be able to meet its liabilities as they fall due until at least the end of August 2019, and continues to monitor closely its working capital position, whilst considering alternative funding options. 

As announced on 12 June 2019, the Shanghai Pudong New Area People’s Court had on 5 June 2019 affirmed the Company’s claim against the Group’s largest customer in China (“the Customer”) for the outstanding debt of RMB 4.76 million (plus interest of RMB 196,000). The Customer was ordered to fully settle the outstanding debt plus interest within 10 days of the date of judgement and had the right to appeal the court judgement within 15 days of the judgement date. The Shanghai Pudong New Area People’s Court received a notice of appeal from the Customer on 26 June 2019 and the Company is taking legal advice in this regard. It remains unclear whether the overdue receivables will be recovered, and further announcements will be made in due course. 

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