Hanpeu "Occurrence of Reasons for Designation as Management Item and Delisting"

[Asia Economy Reporter Ji Yeon-jin] Hanp, a company listed on KOSDAQ, announced on the 4th that due to a decrease in overseas market sales caused by COVID-19, it has experienced poor sales and capital erosion, resulting in reasons for designation as a management item or delisting.

The company received a decision to commence rehabilitation proceedings on October 29 last year, and its separate financial statements for last year showed sales of 1.6 billion KRW, less than 3 billion KRW, triggering reasons for designation as a management item.

Based on consolidated financial statements, reasons for designation as a management item include capital erosion exceeding 50%, and in two of the last three fiscal years, pre-tax losses from continuing operations exceeded 50% of equity at the end of each fiscal year.

According to separate financial statements, operating losses occurred in each of the last four fiscal years, resulting in reasons for designation as a management item. After being designated as a management item due to an adverse audit opinion in the first half of 2020, reasons for delisting arose due to capital erosion exceeding 50% based on consolidated financial statements at the internal settlement point of the most recent fiscal year.

The company stated, "If quarterly sales fall below 300 million KRW or semi-annual sales fall below 700 million KRW, as confirmed by the audit report for the most recent fiscal year (2020), additional reasons for a substantial review of listing eligibility may be added."