Williamson Magor Reports Profit in Q1 Amid Ongoing Financial Challenges
Williamson Magor & Co. Limited reported a profit of Rs. 17,683.00 thousand for the quarter ended June 30, a significant turnaround from a loss of Rs. 2,069,043.00 thousand in the same quarter last year. Total income increased to Rs. 12,881.00 thousand from Rs. 5,082.00 thousand. However, the company continues to face challenges including negative net worth, cancelled NBFC registration, debt defaults, and ongoing legal proceedings with creditors. The management remains confident in the company's ability to continue as a going concern, citing ongoing discussions with lenders and measures to improve cash flows.
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Williamson Magor & Co. Limited , a Kolkata-based company, has reported a profit for the quarter ended June 30, despite facing significant financial challenges and regulatory issues. The company's unaudited financial results reveal a turnaround from losses in the previous year, although concerns about its ability to continue as a going concern persist.
Financial Performance
For the quarter ended June 30, Williamson Magor reported:
| Metric | Current Quarter | Previous Year Quarter |
|---|---|---|
| Total income | Rs. 12,881.00 thousand | Rs. 5,082.00 thousand |
| Profit/(Loss) after tax | Rs. 17,683.00 thousand | Rs. (2,069,043.00) thousand |
| Earnings/(Loss) per share | Rs. 1.61 | Rs. (188.84) |
The company's financial performance shows a marked improvement, primarily due to a substantial reduction in expenses, particularly in provisions for doubtful assets.
Ongoing Challenges
Despite the profit reported this quarter, Williamson Magor continues to face several challenges:
Negative Net Worth: The company's net worth remains fully eroded as of June 30.
NBFC Registration: Williamson Magor is still unable to get its NBFC (Non-Banking Financial Company) registration restored following cancellation by the Reserve Bank of India in July 2022. The company has filed a writ petition with the Calcutta High Court for restoration of the license.
Debt Defaults: The company has defaulted on repayments to several lenders, including HDFC Bank Limited and InCred Financial Services Limited. Legal proceedings and arbitrations are ongoing with various creditors.
Interest Recognition: Due to ongoing disputes with secured lenders, the company has not recognized interest expenses on certain borrowings, which may understate its actual financial obligations.
Deferred Tax Assets: The company has recognized Deferred Tax Assets of Rs. 1,389,795.00 thousand, which auditors have questioned given the uncertainty about future profitability.
Management Outlook
Despite these challenges, the management remains confident in the company's ability to continue as a going concern. They cite ongoing discussions with lenders, support from promoters, and various measures being taken to improve cash flows and working capital position.
Board Decisions
The Board of Directors has made several key decisions:
- Approved the unaudited financial results for the quarter
- Recommended the appointment of M/s MKB & Associates as secretarial auditor for five consecutive years starting April 1
- Appointed two new directors: Mrs. Sonali Datta Sarkar as Additional Director (Non-Executive & Non-Independent) and Mr. Tabrez Ahmed as Additional Director (Non-Executive Independent), effective August 13
While Williamson Magor has shown improvement in its quarterly results, the company's financial health remains precarious. The ongoing legal and regulatory challenges, coupled with its eroded net worth and debt issues, continue to cast doubt on its long-term viability. Stakeholders will be closely watching how the company navigates these challenges in the coming quarters.
Historical Stock Returns for Williamson Magor
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -0.78% | -1.55% | -2.08% | +18.32% | -13.79% | +106.31% |
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