KUALA LUMPUR (March 17): HLT Global Bhd, the glove-dipping lines expert that was once a darling of local stock market at the height of the Covid-19 pandemic, is proposing a capital reduction exercise as a set-off against its nearly RM100 million of accumulated losses as at end-2022.

The proposed capital reduction entails the cancellation of RM120 million from its share capital, which stood at RM208.27 million comprising 775.39 million shares as at March 7.

“The reduced issued share capital pursuant to the proposed capital reduction will also reflect more accurately the value of the underlying assets and the financial position of the company,” said HLT in a filing with Bursa Malaysia on Friday (March 17).  

“Further, the elimination of the accumulated losses from the statement of financial position of the company would not only enhance the credibility of the company with the bankers, customers, suppliers, investors and other stakeholders, but also provide a better financial platform for the HLT group’s future growth moving forward,” it added.

The loss-making company has appointed KAF Investment Bank Bhd as the adviser for the corporate exercise, which requires shareholders’ approval via an extraordinary general meeting.

For the fourth quarter ended Dec 31, 2022 (4QFY2022), HLT’s net loss widened by 80% to RM37.84 million from RM21.03 million a year ago amid depressed glove prices and sales volume.

Revenue fell 63% to RM11.11 million for 4QFY2022 from RM30.02 million in 4QFY2021.

This was the fifth straight quarterly net loss for HLT.

Shares of HLT — which have been trading below 40 sen in the past 12 months — closed one sen or 5% higher at 21 sen, valuing it at RM162.83 million.

The counter once traded as high as RM3.18 in August 2020.