THE loss-ridden activities of Hanny Magnetics have finally been thrown open to shareholders, following intense pressure from the stock exchange.
But trading in the stock, which was suspended last Friday, will not resume until the group clarifies its prospects and reviews comments made by chairman Wong Sun in its annual report.
Last month, Hanny shocked investors with a full-year profit of $30.8 million, down 73 per cent on the previous year's $130 million.
It has now been shown that losses at Memorex, which it acquired in December last year, are much higher than analysts had expected. Sales have been hit by intense price competition and margins are falling.
Hanny has revealed it notched up a $17 million trading loss in its Memorex division in the first three months of operations, while operating expenses for the whole group blew out by $93 million over the year.
Major expenses were in the area of promotion and distribution. A price war in January with one of its main competitors forced the company to respond in kind and boost its marketing.