Zhejiang Tony Electronic Co.,Ltd. (ST东尼) announced on November 12 that it received the "Administrative Penalty Decision" from regulators, imposing fines totaling 15.7 million yuan on the company and six individuals, including its former chairman, for delayed disclosure of major contract progress and false records in annual reports. The Shanghai Stock Exchange also issued a public censure against the company and related responsible parties on the same day.
A capital market veteran noted that regulatory authorities have intensified crackdowns on listed companies' violations this year, reflecting a clearer "zero-tolerance" stance. Measures like "early detection, swift penalties, and strict corrections" aim to protect investors and promote high-quality development among listed firms.
**Key Violations:** 1. **Delayed Disclosure of Major Contract Progress:** In January 2023, Tony Semiconductor, a subsidiary of Zhejiang Tony Electronic, signed a 675-million-yuan procurement contract with Guangdong Tianyu for 135,000 6-inch silicon carbide substrates. The contract accounted for 51.84% of the company’s audited annual revenue. However, by October 2023, only 6.74% of the contracted quantity had been delivered, yet the company failed to disclose the delay until January 6, 2024.
2. **False Records in Financial Reports:** The 2022 annual report and 2023 interim report contained misstatements, including: - Misclassifying defective crystals as inventory instead of R&D expenses, inflating profits. - Omitting raw material purchases covered by related parties, understating costs. - Inadequate provisions for inventory depreciation, further overstating profits. The 2022 and 2023 reports inflated total profits by 38.77 million yuan and 72.28 million yuan, respectively. Corrections were made in April 2024.
**Penalties:** - Zhejiang Tony Electronic: 7 million yuan fine. - Former Chairman Shen Xinfang: 3.5 million yuan fine. - Former CEO Shen Xiaoyu: 1.7 million yuan fine. - Two former CFOs (Yang Yun and Zhong Weiqin): 1 million yuan each. - Former Board Secretary Weng Xinyi: 900,000 yuan fine. - Former Deputy CEO/Board Secretary Luo Binbin: 600,000 yuan fine. Total fines: 15.7 million yuan.
The company’s board secretary resigned, and Deputy General Manager Wu Xuhua was appointed as interim replacement.
**Company Background:** Listed in 2017, Zhejiang Tony Electronic specializes in ultra-fine alloy wires and composite materials. For Q1–Q3 2024, revenue rose 1.5% YoY to 1.457 billion yuan, but net loss reached 14.61 million yuan. As of November 12, its shares closed at 18.26 yuan, down nearly 20% since October 31, with a market cap of 4.2 billion yuan.
