SINGAPORE (Mar 5): E-commerce company YuuZoo Corporation has been asked by the Singapore Exchange to provide further details to explain why certain metrics recently announced in its FY17 earnings fell short.  

The exchange, having dissected YuuZoo’s financial statement released on March 1, noted that there were "a number of errors in the announcement.”

“Please make the relevant amendments and reproduce the revised announcement with the amendments duly marked up,” says the exchange in a Monday filing, without specifying which.

Besides the queries, SGX has also served a rare notice of compliance to YuuZoo, requiring the group to get its statutory auditors to vouch for the accuracy and reasonableness of some other numbers in its unaudited FY2017 income statement within two weeks’ time.

First, the exchange wants the auditor’s opinion on YuuZoo’s reported “other income” of $8 million for 4Q17, which was a surge from $159,000. The company had attributed this increase to assets from YuuLog France.

Next, the exchange is questioning the $54.2 million classified as “assets available for sale” as of Dec 31 2017, up from $33.3 million as of Dec 31 2016. SGX notes that YuuZoo had attributed the rise to an increase in shares held by franchisee companies. SGX also notes that YuuZoo had written off $17.5 million in FY17, and that $38.4 million had been recognised as revenue.

YuuZoo is to explain these two points by March 19, states SGX’s head of listing compliance June Sim in the notice.

Separately, SGX is querying YuuZoo on what led to the suspension of payment-related services during FY2017. This caused YuuZoo’s e-commerce revenue to collapse by 93% y-o-y from $51.8 million to just $0.4 million. In turn, YuuZoo’s total revenue dropped 40% from $103.2 million in FY2016 to $62.2 million for FY2017.  

In addition, SGX is asking for further clarification on why the company’s YuuLog Europe unit managed to report revenue of just $19.7 million, significantly short of earlier the guidance of more than $30 million. SGX is asking for a response by Mar 9.

This will be two days after the planned dialogue session organised by the Securities Investors’ Association (Singapore) and YuuZoo.

The session was organised after the firm faced queries from the Singapore Exchange and corporate governance expert and NUS Business School Associate Professor Mak Yuen Teen over disclosures on its financial performance, among other things.

See: What’s troubling Prof Mak at YuuZoo?

See also: Scrutinising YuuZoo’s deals

Shares of YuuZoo closed Mar 5 down 8.7% to 4.2 cents.