Audit swings Borneo Oil bottom line from black to red

This article first appeared in The Edge Financial Daily, on October 30, 2018.
-A +A

KUALA LUMPUR: Borneo Oil Bhd’s bottom line has gone from black to red for the 17-month period up to June 30, 2018 after its accounts were audited.

The material variance, announced to Bursa Malaysia yesterday, was mainly attributed to an additional provision of a share-based payment expense under Malaysian Financial Reporting Standards 2 (MFRS 2) amounting to RM11.14 million.

That means Borneo Oil has sunk to a pre-tax loss of RM1.59 million for the period under review. It previously announced an unaudited pre-tax profit of RM9.62 million on Aug 28.

“The company’s view was that the share-based payment expense should not be taken up as there was no significant discount to the exercise price of RM0.09,” said Borneo Oil.

“However, the said provision for Esos (employee share option scheme) was provided for as a result of the auditors’ opinion that it was necessary in line with the requirement of MFRS 2 — share-based payment,” it added.

According to its audited accounts released yesterday, its revenue for the 17-month period came to RM137.1 million with a net loss of RM5.9 million.

It previously announced an unaudited revenue of RM137.32 million with RM5.31 million net profit for the period under review.

Borneo Oil is a diversified group with operations in oil and gas, mining, restaurant and franchising and machinery trading, among others.

The counter closed unchanged at five sen apiece yesterday. Over the past year, the stock has declined by 47.4%, according to Bloomberg.