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Global Tech Holdings Continues To Be Hounded With Losses

Global Tech Holdings (SGX: G11) is a dual-listed company (in both Hong Kong and Singapore) that distributes mobile telecommunication products in addition to providing related repair services.

The company has been facing operating losses for years now – going back to at least the financial year ended September 2005 – and from its latest earnings release, it seems the company is still far from turning its fortunes around. The company had just released its second quarter results yesterday.

Operating results

For the six months ended 31 March 2014, Global Tech Holdings faced an 18% year-on-year slump in its revenue to HK$47.7 million.

Most of the company’s revenue comes from the provision of repair services; in the half-year period, the segment had brought in HK$43.6 million in revenue. The segment also managed to make a profit of HK$1.1 million. However, Global Tech Holdings’ trading division had suffered relatively huge losses of HK$2.56 million despite only contributing HK$4.1 million in revenue.

All told, Global Tech Holdings had suffered a loss of HK$8.22 million for the half-year period, roughly similar to the loss of HK$8.15 million it had made a year ago.

Despite facing continuous losses for many years, the company still has a strong balance sheet. Most of the company’s assets lies in its cash balance of HK$30 million at last count. The company does not have any debt and also has very minimal liabilities that total just HK$6.3 million currently. Global Tech Holdings ended the half-year period with a net asset value of HK$48.4 million.

Foolish Summary

The company did not recommend any dividend for the half-year period. Global Tech Holdings is currently trading at a price of S$0.02, giving it a market capitalisation of S$108.5 million and a price to book ratio of 13.8.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Stanley Lim doesn’t own shares in any companies mentioned.