*ST Coconut Island Receives Performance Inquiry: Annual Audit Firm Raises Multiple Concerns, Exchange Continues to Question

On March 18, *ST Coconut Island (600238) issued a notice that it recently received a regulatory work letter from the Shanghai Stock Exchange regarding the 2025 performance forecast.

The company’s performance forecast for 2025, disclosed on January 31, 2026, shows an expected operating revenue of over 300 million yuan and a net loss. The annual audit firm stated that it is currently unable to confirm that the company’s revenue after deductions exceeds 300 million yuan, and is investigating the sales situation at distributor terminals, existing returns, and issues related to the 2024 audit with reserved opinions. The audit firm warned that if sufficient audit evidence cannot be obtained, it may issue a non-unqualified opinion on the company’s 2025 financial statements and internal controls.

The regulator requires the company to disclose detailed information about returns in 2025, including the names of returning customers, amounts, product types, quantities, return times, and reasons, along with explanations of the corresponding revenue recognition year. Additionally, the company must clarify whether the returns comply with sales contract terms and whether there are any other “potential agreements.” Furthermore, the company should explain the accounting treatment of returns, the related accounts receivable balances, and whether returning customers have any interests with the company or its related parties. The regulator also requests disclosure of whether there are other sales reversals such as rebates or expense reimbursements besides returns, and to provide supplementary information on returns in previous years. For issues that led to a qualified opinion on the 2024 financial statements, the company must explain its rectification measures and progress.

Regarding the expected doubling of revenue in 2025, the regulator requires the company to disclose the basic information of the top ten customers and suppliers by business type, including the first cooperation date, transaction details, changes in amounts, payment status, and gross profit margin, and to verify whether there are related-party relationships with the company, controlling shareholders, or senior management. The company should also disclose the sales performance of main products at distributor terminals, accounts receivable accounting, and post-period collections to demonstrate the commercial substance of transactions and exclude the possibility of inventory buildup or extended credit periods to downstream distributors to inflate performance. The regulator specifically requests the company to follow the “Revenue Deduction” guidelines, listing detailed items, amounts, and reasons for deductions from revenue in 2025, ensuring no unrecognized deductions, and highlighting the delisting risk.

The performance forecast indicates that in the fourth quarter of 2025, the company is expected to achieve revenue between 172 million and 192 million yuan, accounting for about half of the annual revenue, nearly equal to the total revenue for 2024. In response, the Shanghai Stock Exchange requires the company to differentiate major products and analyze the reasonableness of the significant quarterly revenue increase through data such as sales prices, quantities, and gross profit margins.

The Shanghai Stock Exchange demands that all directors and senior executives responsibly implement the letter’s requirements, verify relevant information promptly, and respond in writing within the specified deadline. It also requires the annual audit firm, Zhongshen Asia Pacific Certified Public Accountants, to strictly follow auditing standards, focus on verifying the authenticity and accuracy of revenue recognition, perform targeted substantive audit procedures, and issue appropriate audit opinions.

In the first three quarters of 2025, *ST Coconut Island achieved revenue of 178 million yuan and a net loss attributable to the parent of 6.88 million yuan.