Anhui Sierte Fertilizer Industry Ltd Co

ST Site announced on the evening of September 27 a rectification report regarding the Anhui Securities Regulatory Bureau's order for corrective measures. The company had multiple issues including illegal use of non-public offering proceeds, illegal lending of funds to related parties, inaccurate periodic report disclosures, and imperfect corporate governance and internal controls. Some funds occupied by related parties have still not been recovered. The rectification report shows that from 2016 to 2019, the company illegally used non-public offering proceeds involving 115 million yuan, causing losses of 33.0146 million yuan. Its wholly owned subsidiary Xinhong Grand Health illegally lent 110 million yuan to Dongchen Health under the guise of custody. The company also engaged in fabricating engineering projects, revenues, and costs, resulting in false financial data disclosures for 2024 and prior years. The Anhui Securities Regulatory Bureau had previously ordered the company to make corrections, issued a warning, and imposed a fine of 6 million yuan. It also issued warnings to seven individuals including then chairman Jin Guoqing and then general manager Jin Zhenghui, with combined fines of 12.6 million yuan. Regarding fund recovery, the company required Ningguo Agricultural Materials to return all occupied funds and pay occupation fees by September 27, 2026, but as of now Ningguo Agricultural Materials has not returned them, involving 36.8063 million yuan. Dongchen Health still has 32 million yuan in occupied funds unrecovered, and Xuancheng Orthopedic Hospital has been ruled into bankruptcy reorganization. The company stated that the above fund occupation is non-operating fund occupation by other related parties and will not cause the company to trigger relevant provisions of the Shenzhen Stock Exchange stock listing rules, and trading of its shares will not be suspended.

ST Site has been penalized by the Anhui Securities Regulatory Bureau for information disclosure violations. The company fabricated engineering construction business and falsified urea purchases and organic fertilizer sales through a subsidiary, resulting in an inflated total profit of 36.3467 million yuan in its 2021 annual report, accounting for 6.76% of the disclosed total profit for that period, and an understated total profit of 17.3485 million yuan in its 2023 annual report, accounting for 10.35% of the disclosed total profit for that period. The Anhui Securities Regulatory Bureau ordered Site to rectify the situation, issued a warning, and imposed a fine of 6 million yuan. Former chairman Jin Guoqing was fined 3 million yuan and banned from the securities market for 5 years. Former general manager Jin Zhenghui was warned, fined 3 million yuan, and banned from the market for 5 years. Former deputy general manager Fang Jun was warned and fined 2 million yuan. Huang Xili, former head of the audit department and financial director of Guizhou Lufa, was warned and fined 1.5 million yuan. Former deputy general manager Wen Jibing was warned and fined 1.5 million yuan. Ma Lei, former section chief of the office and director of the sales and production scheduling center, was warned and fined 800,000 yuan. Yao Jing, former head of the finance department and deputy financial director, was warned and fined 800,000 yuan.