The secondary battery corporation Kumyang received a 'disclaimer of opinion' on its audit report last year, leading to a suspension of stock trading on the 21st.
On that day, Kumyang's stock traded at 9,770 won in after-hours transactions before trading was halted. This represented a 1.31% decrease (130 won) from the closing price of 9,900 won.
On that day, as rumors of a 'non-appropriate audit opinion' circulated in the market, Kumyang was requested by the Korea Exchange to issue a clarification notice after the market closed, leading to a suspension of trading around 5 p.m. Subsequently, Kumyang submitted the audit report at 5:44 p.m., announcing it had received a 'disclaimer of opinion' from the auditor.
Last year, Kumyang's sales amounted to 134.5 billion won, a decrease of about 1% compared to the previous year. However, the operating loss increased significantly from 16.9 billion won in 2023 to 43 billion won last year, while the net loss for the period grew from 65.8 billion won to 132.9 billion won.
The exchange added 'causes for delisting' to the reasons for designating Kumyang as a management item, which was originally designated for violating disclosure obligations.
In September of last year, Kumyang announced plans to expand its secondary battery factory in the Busan industrial complex and to pursue a shareholder allotment capital increase of 450 billion won. However, facing backlash from shareholders and intervention from the Financial Supervisory Service, the company fully withdrew the plan in January this year. This decision was considered a reversal of its previous disclosure, leading the exchange to designate Kumyang as an unreliable disclosure corporation on the 5th and impose 7 points of penalties along with a disclosure violation fine of 70 million won.
Kumyang accumulated 17 penalty points over the past year, exceeding the threshold of 15 points and thereby being designated as a management item. The company stated its intention to secure a stable supply of lithium, a raw material for secondary batteries, by acquiring equity in a mine in Mongolia. However, it faced controversy over inflating its performance estimates and received a penalty of 10 points last October.