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Real estate group McGrath (ASX: MEA) has posted a half-year net loss of $25.5 million while the listed company deals with the controversy surrounding CEO John McGrath's (pictured) alleged gambling debts.
The company says the significant loss is because of impairments and poor performance by the company-owned sales business.
Shortly after posting the half-year results, McGrath went into a trading halt because of "recent media comment in relation to Mr McGrath".
The trading halt will end once John McGrath issues an announcement himself.
The listed real estate group took a $21.8 million hit in goodwill and a $1.1 million goodwill impairment of Property Management rights.
Revenue for the six months to December 31 was $51.6 million, down 23 per cent on the same period a year ago. No interim dividend will be issued to shareholders.
The controversy surrounding John McGrath stems from media speculation that McGrath is in debt to gambling company William Hill Australia to the tune of $16.2 million.
Further controversy arose when it was revealed that McGrath has a $100 million lending facility which is allegedly funding his gambling habit.
The company has denied the existence of the lending facility and McGrath's alleged gambling habit.
Shares in the real estate company dived to a record low on Tuesday after three board members resigned from the embattled company.
The departure of chairman Cass O'Connor and non-executive directors Elizabeth Crouch and Cath Rogers leaves founder and 26 per cent shareholder John McGrath as the company's only remaining board member.
CEO Cameron Judson and the entire McGrath board will be out the door by close of business on Friday and John McGrath says he will take on the chief executive and chairman roles.
Shares in McGrath closed on Wednesday at $0.42 per share.
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Business News Australia
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