KUALA LUMPUR (Nov 12): Advance Information Marketing Bhd (KL:AIM) was flagged for material uncertainty over the business process outsourcing company’s ability to stay afloat.

Net loss and liabilities exceeded the company's total assets for the financial year ended June 30, 2025 (FY2025), conditions which its external auditor noted may cast “significant doubt” on its ability to continue as a going concern, AIM said in an exchange filing.

“Our opinion is not modified in respect of this matter,” according to the external auditor, Messrs SBY Partners PLT.

‘Going concern’ is an auditing term to describe a company that has enough resources to remain solvent. An auditor may raise a going concern warning if there are doubts over whether a company could continue its operations into the foreseeable future.

An unmodified opinion, meanwhile, indicates that the auditor is convinced that a company's financial accounts are free from material misstatement and comply with accounting standards.

For FY2025, AIM recorded a net loss of RM21.97 million compared to a total assets of RM600,517. As at June 30, its current liabilities also exceeded current assets by RM617,645, while total liabilities surpassed total assets by RM40,481. The company has been in the red for nine consecutive financial years.

Despite the auditor’s caution, AIM’s financial statements were prepared on a going concern basis.

The company explained that the management had drawn up cash flow projections for the next 12 months and considered the company’s ability to generate operating cash flows, concluding that AIM would be able to meet its obligations as they fall due.

To address the uncertainty, AIM said it has begun measures to strengthen its financial position, including cost rationalisation, potential capital restructuring, and reviewing investments to generate new income streams.

The company also noted that, on a consolidated basis, it remains “financially sound”, and it intends to leverage positive cash flows from subsidiaries to support its working capital requirements.

The measures are being executed immediately, though their outcomes will be dynamic and without fixed timelines, AIM added.

For the 18-month period ended June 30, 2025, AIM's net loss widened to RM11.07 million from RM4.73 million in the preceding year, even though revenue more than doubled to RM7.66 million from RM3.53 million. The prior year’s figures were based on a 12-month period ended Dec 31.

In January, AIM proposed a share capital reduction of RM32 million as part of efforts to offset its accumulated losses.

AIM shares closed at three sen on Wednesday, giving the company a market capitalisation of a little under RM12 million.