Tuesday 16 Jul 2024
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KUALA LUMPUR (June 9): Greatech Technology Bhd said its earnings will not be affected by issues faced by its client Lordstown Motors Corp, which reportedly will not be able to commence full commercial production and there are doubts over whether it could continue as a going concern through the end of the year.

Greatech executive director and chief executive officer (CEO) Tan Eng Kee told theedgemarkets.com that the group will not be affected by the issues at the US-based electric truck start-up, adding that Greatech still expects to meet its targets for 2021 and 2022.

He said that Greatech has communicated with Lordstown Motors, and that the latter said it would try to raise funds for commercial production.

"Investors have oversold as they are looking only at the Lordstown issue at the moment. I hope they look at our overall performance and not only on the single customer.

"I strongly believe my leadership will manage this issue well," said Tan.

The Wall Street Journal on June 8 reported that the US-based electric-truck start-up disclosed that it did not have sufficient cash to start full commercial production and had doubts about whether it could continue as a going concern through the end of the year.

The publication said Lordstown Motors had amended its annual report to include the going concern notice, which came as new challenges emerged for the two-year-old company that is trying to convert a former General Motors Co plant in Ohio to produce electric pickup trucks.

Quoting a spokesman for the company, the report said the company was not moving back its September target for the start of production and that it hoped to raise more capital, potentially through asset-backed financing or a government loan programme.

At 3.19pm, Greatech was down 50 sen or 8.6% at RM5.30, translating into a market capitalisation of RM6.64 billion.

Edited ByJoyce Goh
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