Guang Dong Sitong Group Co Ltd

Guangdong Sitong Group Co., Ltd., known as *ST Sitong and listed on the Shanghai Stock Exchange under ticker 603838, announced on the evening of September 30 that it recently received a warning letter from the Guangdong Regulatory Bureau of the China Securities Regulatory Commission and was ordered to take corrective administrative regulatory measures. The Guangdong Securities Regulatory Bureau found that in its first-quarter, half-year, and third-quarter reports for 2025, *ST Sitong incorrectly recorded certain transactions as operating revenue, causing material discrepancies between the disclosed data in those reports and the actual situation. The company adjusted the relevant financial data when disclosing its 2025 annual report. In addition, in 2025 the company sold sanitary ceramic display products to multiple individual customers, and the resulting losses differed significantly from the inventory impairment provisions made before the sale. When previously estimating inventory impairment losses, the company did not fully consider that the net realizable value of such inventory was clearly lower than its book value, resulting in insufficient asset impairment provisions and inaccurate data disclosed in the relevant annual reports. The Guangdong Securities Regulatory Bureau also issued warning letters to Deng Jianhua, chairman, Cai Zhentong, general manager, and Zhang Ping, chief financial officer. *ST Sitong stated that the company and the responsible persons attach great importance to the matter, will strictly rectify it as required, and will submit a written rectification report in a timely manner. The receipt of this warning letter will not have a material impact on the company's production, operation, or management activities.

ST Sitong has disclosed its earnings forecast, expecting a net loss attributable to the parent company of 22 million to 29 million yuan in the first half of 2026, compared with a loss of 16.2006 million yuan in the same period last year. The net loss after deducting non-recurring items is expected to be 27 million to 33 million yuan, compared with a loss of 21.3267 million yuan a year earlier. The company said the losses are mainly due to persistently rising upstream raw material prices coupled with weak downstream demand, leading to higher production costs and limited room for product price adjustments, putting overall profitability under pressure. ST Sitong is mainly engaged in new-style household living ceramics, with business extending to zirconium-titanium ore refining and ceramic color glazes.