CSE Global unit’s US lawsuit may affect 2024 earnings

The company could not quantify the impact, as the legal proceedings are at a preliminary stage

Provider of TECHNOLOGICAL solutions CSE Global said on Friday (27 December) that its financial performance for the current financial year ending 31 December could be affected by a lawsuit its unit plans to introduce in the US.

It said its wholly-owned subsidiary CSE W-Industries wanted to take legal action against a client in Texas. This was to recover $6 million that the client had requested on the standby letter of guarantee from a bank on December 20.

The client hired CSE W-Industries as a subcontractor for a construction project there, while it acted as the general contractor. He requested the letter in relation to the project, which could only be drawn to pay the client if CSE W-Industries failed to make the payment.

CSE Global said the client’s appeal about the letter was “frivolous and without merit”.

She warned that if she is unsuccessful in the lawsuit or unable to recover the full $6 million, there could be an impact on her financial performance.

The Singapore-based company could not quantify the impact, as legal proceedings are at a preliminary stage.

Last month, CSE Global announced its third quarter income increased 15.4% year-over-year to $213.9 million due to higher contributions from all business segments.

Its shares closed down $0.005, or 1.1%, at $0.46 on Thursday.