The company could not quantify the impact, since legal proceedings are in the preliminary stage
TECHNOLOGY solutions provider CSE Global said on Friday (Dec 27) that its financial performance for the current financial year ending Dec 31 may be affected by a lawsuit its unit intends to file in the US.
It said its wholly owned subsidiary, CSE W-Industries, wanted to start legal proceedings against a customer in Texas. This was to recover US$6 million that the client had called on the standby letter of guarantee from a bank on Dec 20.
The customer had engaged CSE W-Industries as a sub-contractor on a construction project there, while it acted as the general contractor. It had applied for the letter in connection with the project, which could be drawn only to pay the client should CSE W-Industries fail to make payment.
CSE Global said the client’s call on the letter was “frivolous and without merit”.
It cautioned that if it does not succeed in the lawsuit, or is unable to recover the full US$6 million, there could be an impact on its financial performance.
The Singapore-based company could not quantify the impact, since the legal proceedings are in the preliminary stage.
Last month, CSE Global said its third-quarter revenue rose 15.4 per cent year on year to S$213.9 million, due to higher contributions from all business segments.
Its shares closed S$0.005 or 1.1 per cent lower at S$0.46 on Thursday.
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