Shares in Sunkar Resources plunged on the company's admission it was in danger of defaulting on a loan.

The company's current cash position is $0.057m, which is $0.35m below budget, due to delayed payments from existing contracts for its non-core but cash-generating earth moving business, Temir.

Sunkar said many new government contracts denominated in the local currency, the tenge, have been put on hold due to the uncertainty in the local economy.

The company said this had "led to delays in the receipt of monies due to Sunkar in respect of its existing earth moving contracts and also delays in agreeing any new contracts".

Temir has found it difficult to negotiate new contracts and is thus expected to generate materially less cash, meaning it was recently unable to make its regular monthly payments against a loan to Asia Credit Bank.

"The company has operated at a loss for the year to date, in both cash and profit terms, and is expected to continue to do so until further earth moving contracts can be secured or an alternative strategy developed," Sunkar said.

With ACB threatening to call default on monies owed, Sunkar has gone cap in hand once again to 51.2% shareholder Sun Avenue Partners Corp, a vehicle of Kazakh owner Almas Mynbayev, to discuss a new convertible shareholder loan.

Sunkar Resources' share price was down 57.6% to 1.75p at 12:50 on Wednesday.


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