Coolpad Group (02369.HK) announced on March 25 that its independent non-executive director, Guo Jinghui, is currently under investigation by the Shenzhen Supervisory Commission and has been subjected to detention measures. The company disclosed this information in a public filing.
According to the announcement, Coolpad Group has received notification from the relevant commission. As of now, the company has not been asked to assist in the investigation or provide any materials, and its business operations remain normal.
Coolpad Group stated that Guo Jinghui is not involved in the company's day-to-day operations or management. Other directors and senior management are performing their duties normally. The company expects this matter will not significantly impact its operations or business activities. The board of directors is assessing the situation and will make necessary arrangements regarding Guo Jinghui's roles and responsibilities.
Previous announcements from Coolpad Group show that Guo Jinghui previously held positions in government departments. From 2007 to 2009, he served as Director of the Human Resources Management Office in Shenzhen's Guangming New District. Between 2009 and 2013, he held the position of Member of the Guangming New District Party Working Committee and Director of the Organization and Personnel Bureau. From 2013 to 2014, he served as Standing Committee Member of the Nanshan District Committee and Head of the Organization Department in Shenzhen. Between 2014 and 2018, he was Deputy Secretary of the Party Committee at Guosen Securities Co., Ltd.
Guo Jinghui has been serving as an independent non-executive director of Coolpad Group since October 2019 and is also a member of the audit committee and remuneration committee.
Historical information indicates that Coolpad Group's origins can be traced back to Yulong Computer Telecommunication Technology Co., Ltd., established in 1993. The company was incorporated in the Cayman Islands in 2002, initially named "China Wireless Technology Limited." Coolpad Group was listed on the main board of the Hong Kong Stock Exchange on December 9, 2004. Currently, the company operates globally under the "Coolpad" brand, with products covering smartphones, wearable devices, cloud tablets, and automotive equipment, among other categories.
Coolpad was once a prominent player in the domestic Chinese mobile phone market, being one of the "Zhonghua Coolian" top four Chinese phone manufacturers. In June 2015, LeEco took a controlling stake in the company. For over half a year following this, Coolpad did not release any new products and dropped out of various phone rankings within just two years.
As telecom operators lost their dominant influence over the smartphone market and due to the impact of the LeEco incident, Coolpad's funding gap continued to widen. The company's performance began a continuous decline, resulting in significant losses for many years. Over the past three years, Coolpad Group has continued to face a situation of increasing revenue without corresponding profit growth.
In recent years, Coolpad Group's financial performance has shown the awkward trend of rising revenues without profitability. In 2022, the company reported revenue of 299 million HKD but a net loss attributable to shareholders of 625 million HKD. In 2023, revenue increased by 2.73% to 307 million HKD, yet the net loss attributable to shareholders was approximately 221 million HKD. For the 2024 financial year, the company's revenue grew significantly by 62.46% to 499 million HKD, but the loss widened to 252 million HKD, a year-on-year increase of about 14%. For 2025, benefiting from a reduction in administrative expenses of about 55 million HKD and other gains of approximately 168 million HKD from the sale of investments and patent licensing rights, the full-year loss is projected to narrow to between 105 million and 125 million HKD.
As of the market close on March 26, Coolpad Group's share price was 0.62 HKD per share, with a market capitalization of just 206 million HKD. This is only a fraction of its peak market cap of approximately 15 billion HKD in June 2015.
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