Philippine Air’s parent halted from trading after audit report

Shares of Philippine Airlines Inc.’s parent company were suspended from trading on Friday after its auditor issued a disclaimer of opinion on its annual report.

The Philippine stock exchange suspended trading of PAL Holdings Inc. shares from 9:30 a.m., extending a halt imposed on Thursday when the company submitted its annual report that showed it posting a record loss in 2020 due to the “extraordinary” impact of the pandemic.

The bourse said the report isn’t compliant with the Securities Regulation Code, citing accounting firm SyCip Gorres Velayo & Co.’s disclaimer opinion that it’s unable to obtain “sufficient appropriate” audit evidence for an opinion on PAL’s financial statement.

Officials of PAL Holdings and Philippine Air weren’t immediately available to comment.

PAL Holdings reported a record 71.8 billion pesos ($1.48 billion) loss in 2020, compared to a 10.3 billion peso shortfall the year before, the company said in a stock exchange filing Thursday. In the first quarter of 2021, its loss narrowed to 8.6 billion pesos from 9.4 billion pesos a year earlier. Management and stakeholders are working on the final stages of a comprehensive restructuring plan for the airline, it said.

SGV said that as PAL is embarking on a financial restructuring and is considering a pre-negotiated court rehabilitation plan, these events “give rise to material uncertainties that may cast significant doubt on the group’s ability to continue as going concern.”