LNGF(SZ:002717) Zhong Guo Jing Ying Bao·2025-12-18 08:15Core Viewpoint - ST Lingnan has been sentenced to a fine of 600,000 yuan for collusion in bidding, with two responsible personnel receiving suspended prison sentences, but the company claims this has not significantly impacted its operations [1][2]. Legal Issues - The case originated from a project won by ST Lingnan in June 2021, with a contract value of 96.2265 million yuan, representing 9.04% of the company's latest audited net assets [2]. - The court found that employees of ST Lingnan's subsidiary failed to comply with legal bidding procedures, leading to the charges of collusion [2]. - The company has stated that the judgment is not yet effective and has not had a major impact on its operations, nor does it trigger mandatory delisting conditions [2]. Financial Challenges - ST Lingnan is facing multiple challenges, including overdue debts, litigation disputes, and continuous losses [3]. - As of November 15, the company reported overdue interest debts of 139 million yuan, which is 13.08% of its audited net assets for 2024 [3]. - The company has also disclosed that it has faced new litigation and arbitration cases totaling approximately 113 million yuan, which is 10.60% of its latest audited net assets [3]. Performance Issues - ST Lingnan has reported consecutive losses over the years, with a cumulative net profit loss of 3.63 billion yuan from 2022 to 2024 [4]. - As of the third quarter of 2025, the net profit loss was 206 million yuan, primarily due to difficulties in collecting receivables, exacerbated by tight local government finances [4]. - The company’s accounts receivable balance reached 2.259 billion yuan by the end of 2024, indicating reliance on local government payments for revenue [4]. Compliance Risks - ST Lingnan is also facing other compliance risks, including an investigation by the China Securities Regulatory Commission for information disclosure violations [5]. - The company has initiated legal action against its former controlling shareholder for the recovery of 142 million yuan in misappropriated funds [5].