2GO appoints new CFO, reports lower 2015, 2016 profits

HIGHER STANDARDS. 'The restatement is a commitment of the new management and Board of Directors to raise corporate governance standards in the company,' says 2GO president Dennis Uy. Photo from supercat.com.ph

HIGHER STANDARDS. 'The restatement is a commitment of the new management and Board of Directors to raise corporate governance standards in the company,' says 2GO president Dennis Uy. Photo from supercat.com.

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MANILA, Philippines – 2GO Group Incorporated appointed a new chief financial officer and treasurer, following adjustments in its reported net income for 2015 and 2016.

The listed logistics company told the Philippine Stock Exchange (PSE) late Friday, July 7, that its board of directors appointed William Charles Howell as CFO and treasurer to replace Jeremias Jeremias Cruzabra, who had resigned.

After a special audit, 2GO also reported a restatement of its financial performance for 2015 and 2016, as well as the unaudited financial statements for the 1st quarter of 2017. (READ: How SM Investments acquired stake in 2GO)

In its special audit, 2GO reported its net income actually stood at P109.131 million in 2015. This is a 90% decline from the P1.08-billion profit 2GO earlier reported in its 2015 annual report. 

For 2016, 2GO said in the disclosure that its restated net income is P344.035 million, 74% lower than what was reported in its 2016 annual report.

"The restatement is a commitment of the new management and board of directors to raise corporate governance standards in the company," Dennis Uy, the newly-appointed president of 2GO, said.

"The potential of 2GO to grow and be a major player in this dynamic shipping and logistics industry remains intact," Uy added.

Requiring restatement

For the 1st 3 months of 2017, the new management of 2GO said the company should have announced a net loss of P264.86 million, rather than a profit of P267.562 million.

"Soon after we took over the management of the company, we engaged SGV and Company to audit the company's balance sheet and income statement as of the closing date to ensure fair presentation of financial statements and establish accountabilities," Uy said.

The new 2GO president said the audit showed that certain accounts in the previously audited financials required restatement.

"[T]he new management, with the support and approval of the newly-elected members of the audit committee and board of directors, agreed to restate prior period financial statements to reflect fairly the state of the business," Uy said.

The local bourse announced it is set to implement a trading suspension on 2GO shares on Monday, July 10, pending the firm's submission of more data.

Uy was appointed by 2GO's board of directors in a meeting last April 7, after the decision of Sulficio Tagud Jr to retire both from the management and the board. 

Uy also serves as the chairman of Udenna Corporation, the parent firm of Phoenix Petroleum and Chelsea Logistics Corporation

Udenna Corporation owns 31% of KGLI-NM Holdings Incorporated, which in turn, has a 60% stake in 2GO's parent firm, Negros Navigation Company Incorporated. – Rappler.com