It’s been a tough year for China’s Hanergy Thin Film Power Group Ltd. First, the solar-equipment maker saw its stock lose half of its value in a single day back in May, then trading was suspended and has yet to reopen. Later that day, the Chinese securities regulator announced that Hanergy was under investigation. The company apparently still remains the focus of an unspecified regulatory probe, and announced on Monday of this week that its financial controller had resigned.
China analysts highlight that the current resignation is just the latest in a string of more than a half-dozen resignations by senior execs at the firm.
The company noted in a statement to Hong Kong’s stock exchange late Monday that Li Guangmin, the firm’s financial controller, had resigned and also stepped down as an executive director on the BoD. Li was reportedly leaving the company for reasons related to “personal career development.”
The statement from Hanergy also noted that Li has no disagreement with the board and no matters related to the resignation needed to be considered by the exchange or company shareholders.
Li had been serving as the financial controller for more than four years, and had been employed by the parent firm Hanergy Group since 2002, based on regulatory filings.
As reported by ValueWalk earlier this summer, rumors are swirling that Hanergy Thin Film was being plundered as part of a collapsing pyramid scheme, especially given that Chairman Li Hejun apparently had a large short position in his own firm.
Keep in mind that the firm is divided into two corporate entities: privately owned parent corporation Hanergy Group, and the publicly traded subsidiary Hanergy Thin Film Power. Also, almost all of HFT’s sales are to its parent company, and all at a net profit margin of 50%. Moreover, the parent has not yet paid for most of the solar panel equipment it purchased from HFT. In fact, according to the most recent regulatory filings, a mere 35% of the debts between the two firms had been paid as of year-end 2013.
More on resignation of financial controller at Hanergy Thin Film
Hanergy noted in its statement that Huang Songchun, who has been with parent firm since 2004, had been tapped as the new financial controller for the company.
A couple of weeks after the investigation was first announced, the company secretary of Hanergy Thin Film resigned, the second person to resign from the position this year.
The slew of resignations coincides with the Chinese Securities and Futures Commission’s ongoing probe of Hanergy Thin Film’s accounting and its financial arrangements with its parent company.