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Huishan Dairy to miss results deadline, says finances unclear
June 5, 2017 / 6:16 AM / 6 months ago

Huishan Dairy to miss results deadline, says finances unclear

SHANGHAI, June 5 (Reuters) - China Huishan Dairy Holdings Co Ltd said on Monday that it will miss a June deadline for publishing its full-year results as the indebted firm faces “tremendous difficulties” getting a clear picture of its finances.

Huishan’s stock has been suspended from trade since March 24, when it plunged 85 percent. Since then most of the firm’s directors have quit, it has missed loan payments and lost contact with a key executive in charge of its finances and cash.

Huishan said details on its cash position, receivables, payables and borrowings were particularly unclear.

“The company will not be in a position to publish the audited results of the Group for the year ended 31 March 2017 on or before 30 June 2017,” it said in a filing.

The firm said last week it was facing legal action in more than a dozen court proceedings over money owed to creditors, ramping up pressure on a firm whose recent travails have laid bare the risks of excess leverage and financial engineering in hidden corners of corporate China.

Huishan, which counts Bank of China Ltd and HSBC among its creditors, said its total debt pile totalled 26.73 billion yuan ($3.9 billion), though it added it could not guarantee the accuracy of its numbers.

The dairy firm also said it would hire a forensic accountant to investigate the gaps in its financial statements.

Huishan’s board was left paralysed in April after a spate of resignations left it with just two executive directors, including embattled chairman Yang and finance director Ge Kun. Ge has now been missing for over two months. ($1 = 6.8041 Chinese yuan) (Reporting by Adam Jourdan; Editing by Edwina Gibbs)

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