On the evening of November 5, Winning Health Technology Group Co., Ltd. (300253.SZ, stock price: 9.15 yuan, market cap: 20.26 billion yuan) announced that its wholly-owned subsidiary Shenzhen Winning Zhongtian Software Co., Ltd. (hereinafter referred to as "Shenzhen Winning Zhongtian") and the family of its actual controller and Chairman Zhou Wei received a "Criminal Judgment" issued by the Dianbai District People's Court of Maoming City, Guangdong Province. The judgment ruled that the defendant Shenzhen Winning Zhongtian was guilty of unit bribery and fined 800,000 yuan. Zhou Wei was sentenced to one year and six months in prison and fined 200,000 yuan for the same crime.
The announcement stated that this is a first-instance judgment and has not yet taken effect. Both the defendant unit and Zhou Wei have decided to appeal to the Maoming Intermediate People's Court of Guangdong Province. Regarding the impact of the judgment, the company stated that Shenzhen Winning Zhongtian operates only in certain areas of Guangdong and is not expected to have a significant adverse effect on the company's operations.
Notably, Zhou Wei is currently unable to perform his duties normally. Winning Health stated that it will convene a board meeting as soon as possible to deliberate on appointing Vice Chairman Liu Ning to act as chairman and legal representative in Zhou Wei's absence.
Zhou Wei had been under investigation by the Maoming Supervision Commission since July 2023 for matters related to this case. After over a month, he was released from detention and returned to Shanghai, with the case entering further investigation. The judgment marks the conclusion of a two-year investigation. The announcement did not disclose details such as the bribery recipient or amount but confirmed the charge as "unit bribery."
According to the announcement, Winning Health believes the direct impact of the case is limited because Shenzhen Winning Zhongtian is a regional subsidiary contributing only 0.49% of revenue and 7.97% of net profit in 2024 (13.65 million yuan and 7 million yuan, respectively). The company emphasized that its daily operations are managed by the executive team and remain normal.
Zhou Wei, born in 1967, holds an EMBA from CEIBS and has served in executive roles at Winning Health since 2004. The company is a leading provider of healthcare IT solutions in China, serving public hospitals and health authorities.
However, Winning Health has been struggling with declining performance. For the first three quarters of this year, revenue fell 32.27% year-on-year to 1.296 billion yuan, while net profit dropped 256.10% to a loss of 241 million yuan. The company attributed this to delayed customer demand, postponed project approvals, slow monetization of new products, rigid costs, business optimization, asset impairments, and tax arrears.
As of press time, Winning Health's stock price had plunged over 10% to 8.21 yuan per share, with a total market capitalization of 18.2 billion yuan.
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