Latitude Tree says lost inventory, building and machinery in fire incident at Vietnam factory

PETALING JAYA: Latitude Tree Holdings Bhd today announced that a fire incident at a factory building in Binh Duong, VIetnam belonging to RK Resources Co Ltd, an indirect wholly-owned subsidiary of the company, may have seen losses of US$5.5 million (RM21.45 million) in inventory, building and machinery.
RK Resources is a major operating subsidiary and the affected building is located within RK Resources’ manufacturing facilities. The building houses the assembly and packing line, inventories of work-in-progress and finished goods.
The fire started at 12.30 a.m today, 5 April 2018 and was totally put out at 7.00 a.m. The damage sustained from this fire incident is restricted to only one old building. Other manufacturing facilities of RK Resources were not affected and production activities are running as normal.
Some US$3 million of inventories, US$2 million building and US$500,000 machinery is estimated to have been damaged.
The fire department and insurance representatives are still conducting investigation to ascertain the cause of the fire. All the assets are adequately covered by insurance. Sufficient insurance coverage has been taken for consequential business loss.
RK Resources is now assessing the operational and financial impact arising from this incident. RK Resources has also commenced discussion with affected customers to reschedule shipments of finished goods and plans to increase production hours by additional overtime to replenish destroyed finished goods.
Latitude's share price was down 12 sen to RM3.28 today, with some 102,100 shares changing hands.