AutoBeta(AutoBeta.net)07/28 Report--

Manufacturing base stopped production, sales fell sharply, performance losses are large, Zhongtai automobile empire is teetering. Recently, due to the untimely and inaccurate disclosure of financial information, Zhongtai Chairman Jin Zheyong and other senior executives were named and warned.

On July 28, Zhongtai Automobile announced that the company and related personnel recently received a "decision on taking warning letter measures to Zhongtai Automobile Co., Ltd." issued by Zhejiang Regulatory Bureau of China Securities Regulatory Commission. After investigation, Zhejiang Securities Regulatory Bureau found that Zhongtai Automobile has the following problems:

1. On January 20, 2020, the company disclosed the "2019 performance Forecast", showing that the net profit belonging to the shareholders of the listed company was a loss of 6 billion yuan to 9 billion yuan. June 18, the company disclosed the "2019 results forecast revision announcement" revised the above amount to a loss of 10.8 billion yuan to 11.5 billion yuan. On June 23, the company disclosed the annual report of 2019, which shows that the actual performance is 11.19 billion yuan, which is quite different from the amount disclosed in the performance forecast in January 2010. the company did not revise the performance forecast in 2019 in time.

2. In the process of compiling the one-quarter, half-yearly and three-quarter reports in 2019, due to accounting errors, the operating income and operating costs falsely increased at the same time, and the information disclosure was inaccurate.

The above actions violated the relevant regulations. Jin Zheyong, chairman and president of the company, Yang Haifeng, secretary of the board of directors, Zhang Zhi, chief financial officer, and Fang Maojun, then chief financial officer, violated the relevant regulations and bear the main responsibility for the untimely and inaccurate disclosure of the company's information. Zhejiang Securities Regulatory Bureau decided to take the supervision and management measures of issuing warning letters to the above-mentioned executives, which shall be included in the integrity files of the securities and futures market.

Zhongtai Automobile said that after receiving the above warning letter, the company and all directors, supervisors, and senior managers attached great importance to it and profoundly reflected on the problems and deficiencies in the company's information disclosure work, and the company will comply with the requirements of Zhejiang Securities Supervision Bureau and actively rectify and reform.

At present, the bases under Zhongtai Automobile are basically in a state of suspension or semi-suspension of production, resulting in a substantial decline in automobile production and sales and a substantial decline in sales revenue, resulting in a large performance loss. In 2019, Zhongtai sold only 21224 new cars.

Zhongtai Automobile said in a statement that the company has not yet made normal production due to the availability of funds, but the preparatory work for resumption of work and production is ready, and the company can officially resume production and continue to operate as soon as the funds are in place.

With regard to the situation of arrears of wages to employees, Zhongtai Motor admitted that there were varying degrees of arrears of wages in various units since October 2019. Therefore, in addition to normal bank financing, the company intends to find ways to solve the problem of unpaid wages and resumption of production by means of land replacement, idle and non-main business assets sale, finding partners and so on. At present, the company is reissuing the wages owed by the staff and workers with the help of the government. Except for some bases, the company has completed the reissue of the wages of ordinary employees.

Due to its own poor management, unable to adapt to the changes in the market environment, Zhongtai Automobile has fallen into an unsustainable situation, coupled with the impact of the epidemic, the former huge car empire is teetering. Zhongtai Motor is facing great operational difficulties, such as no external funds to support its resumption of operation, or will face the fate of being eliminated.

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