Daya Sacred Elephant received a warning letter due to information disclosure violations

Reporter | Sun Meixin Edit |

Due to the inaccurate disclosure of executive compensation, Daya Shengxiang recently received a warning letter issued by the Jiangsu Securities Regulatory Bureau.

On December 6, Daya Shengxiang issued an announcement that the company received the "Decision on Warning Letter Measures" issued by the Jiangsu Securities Regulatory Bureau. The "Warning Letter" said that the company had two information disclosure violations, one was that the company's directors, supervisors and senior executives disclosed inaccurately in their remuneration in 2019; and the other was that the financial management and accounting were not standardized.

Among them, the company's disclosure of "high remuneration for directors and supervisors" in the 2019 annual report did not include the convertible bond project bonuses issued by the company to Directors, Supervisors and senior management such as Chen Xiaolong, Xiao Min, Chen Gang, Shen Longqiang, Xu Yongsheng, Wang Yong and other directors, supervisors and senior management in July 2019, which did not meet the requirements of the Xinpi Standard.

In addition, the company's expense reimbursement has the problem of untimely reimbursement and inter-period accounting, which does not conform to the accounting principle of accrual system in violation of the provisions of the Accounting Standards for Business Enterprises - Basic Standards.

The CSRC mentioned in the Warning Letter that the inaccuracies of the Daya Sacred Elephant Letter will be recorded in the securities and futures market integrity file.

According to the 2019 annual report, The senior executives mentioned in the warning letter at the time, Chen Xiaolong as the chairman, Xiao Min as the director, Chen Gang as the director and financial director, Shen Longqiang as the secretary of the board, Xu Yongsheng as the director, and Wang Yong as the supervisor.

The information shows that Chen Xiaolong and Xiao Min received zero pre-tax remuneration from the company in that year, but Chen Jianjun, who was a director of the company at the time, both received remuneration from the company's related parties. The pre-tax income of the remaining executives was 692,700 yuan for Chen Gang, 841,500 yuan for Shen Longqiang, 1,361,900 yuan for Xu Yongsheng, and 527,500 yuan for Wang Yong.

According to the announcement issued by Daya Shengxiang on June 20, 2019, the company approved the public issuance of convertible bonds with a total face value of 1.2 billion yuan to the public for a period of 6 years, but did not announce the specific amount of convertible bonds issued by the directors and supervisors.

However, the convertible bond was not successfully issued. According to the announcement issued by the company on November 22, 2019, due to the company's failure to publicly issue convertible bonds within 6 months from the date of approval of the issuance by the CSRC, the approval is invalid. In other words, the 1.2 billion yuan of convertible bonds could not be successfully issued.

After more than 2 years, several of the senior executives mentioned in the warning letter have undergone significant changes. Shen Longqiang and Xu Yongsheng have resigned from Daya Shengxiang, Chen Gang is also a director, financial director and vice president, and Chen Xiaolong died of a sudden illness in May 2020, after which Chen Jianjun served as chairman.

In fact, this is not the first time that the Daya Icon has received a warning letter in recent years. In September 2020, the Jiangsu Securities Regulatory Bureau issued a warning letter in June and August 2018 due to the existence of equity transfer and agreement termination of daya technology group by the controlling shareholder Daya Technology Group, which caused a major change in the actual controller of the listed company to control the company, but the company did not perform the relevant information disclosure obligations in a timely manner.

Judging from the two receipts of the "Warning Letter", although due to internal and external factors, the matters mentioned in some announcements have not actually occurred, there are still irregularities in the operation of daya sacred images in information disclosure matters.

This may reveal from another perspective that the family business of Daya Shengxiang, as a listed company governance norms, has many areas that need to be improved.

It is worth noting that after the secretary of the board of directors Shen Longqiang resigned this year, he has not yet formally appointed the secretary of the board of directors, and the current responsibilities of the secretary of the board are replaced by Chen Jianjun. In addition, judging from the announcements continuously issued by Daya Shengxiang, the pledge ratio of the shares of the company's controlling shareholders remains high. According to the announcement, by September 8 this year, Daya Technology Group, the controlling shareholder of Daya Shengxiang, continued to pledge shares, accounting for 77.1% of its shares and 35.81% of the company's total share ratio.

Although the third quarter results released show that the company's operating conditions have improved compared with the earlier turmoil, the revenue from January to September this year can reach 6.136 billion yuan, an increase of 31.79% year-on-year, and the net profit attributable to shareholders of listed companies is 479 million yuan, up 12.07% year-on-year.

However, in the third quarter, although the revenue reached 2.573 billion yuan, up 21.6% year-on-year, the quarterly net profit attributable to shareholders of listed companies was 177 million yuan, a year-on-year decline of 32.03%.

As a home furnishing enterprise with flooring as its core business, Daya Sacred Elephant is still at the peak of market demand. However, with the changes in the market environment, if there is a situation of irregular governance, it will continue to affect the operation and management and performance of enterprises.