Taiwan Stock Exchange Corp will restrict trading in shares of Power Quotient International Co (勁永國際) to cash transactions only starting today, amid allegations the company inflated revenue figures for last year.
Established in 1997, Power Quotient manufactures and markets computer memory modules, flash memory storage devices and peripherals.
Its brand-name memory cards and modules currently rank No. 4 in the market.
Subsidiaries
After a review of Power Quotient's financial records, the stock exchange suspects the company boosted its sales figures by engaging in so-called "related-party transactions" -- transactions conducted among Power Quotient and its subsidiaries or companies it controls -- worth NT$2.5 billion, or 15 percent of Power Quotient's revenue last year. These transactions were allegedly used to boost revenues.
Power Quotient Chairman Jance Lu (呂美月) and Vice President Kuo Ching-hwei (郭清輝) on Wednesday denied any intentional manipulation of numbers, but did admit to making certain errors on the financial statements.
At a briefing with reporters, the officials said the company had neglected to specify that several downstream companies named in the transactions are owned or controlled by Lu herself, Lu's relatives and former Power Quotient employees.
"But the amount of related-party transactions only reached NT$1 billion, or 5.8 percent of the company's revenue last year," Kuo said.
Companies affiliated with Power Quotient include Carton Electronic Ltd, Cyber Center Development Ltd and seven other companies, according to the stock exchange.
But in a statement the company posted on the exchange's Web site yesterday, Kuo denied that these companies are Power Quotient's affiliates, saying Power Quotient had sold about NT$1.97 billion of goods to the firms.
As Power Quotient failed to clarify some of the exchange's questions, the regulator decided to limit trading in the company's shares to cash transactions only, until the company hands in a revised financial report.
This means that shares of Power Quotient are reclassified as "full-delivery stock," and investors are not allowed to trade these shares on margin, or borrowed funds.
Barred from travel
Prosecutors are investigating the allegations, while Lu and some other people related to the case are prohibited from leaving the country.
The company's share price has been clobbered in the wake of the incident, but Kuo said its financial situation is still stable, with NT$1 billion in cash on hand.
Additionally, Power Quotient's upstream suppliers, including Powerchip Semiconductor Corp (
Shares of Power Quotient fell by the 7 percent limit at the market's open yesterday and never recovered, dropping NT$1.65 to close at NT$22.10.
The company posted revenue of NT$1.362 billion last month, up 87.72 percent from the same period last year.
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
While China’s leaders use their economic and political might to fight US President Donald Trump’s trade war “to the end,” its army of social media soldiers are embarking on a more humorous campaign online. Trump’s tariff blitz has seen Washington and Beijing impose eye-watering duties on imports from the other, fanning a standoff between the economic superpowers that has sparked global recession fears and sent markets into a tailspin. Trump says his policy is a response to years of being “ripped off” by other countries and aims to bring manufacturing to the US, forcing companies to employ US workers. However, China’s online warriors
RSS