New | Shares of world’s largest footwear maker plunge on false sales data

Shares of Pou Sheng and its shareholder Yue Yuen plunge in Hong Kong after the retailer fired its CFO for publishing false sales data

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Striking workers at a Yue Yuen factory in Dongguan in April 2014. The company employs more than 400,000 workers in China, Vietnam and Indonesia. Photo: Reuters

Published: 3:17pm, 9 Jan 2017Updated: 11:02pm, 9 Jan 2017

Pou Sheng International Ltd, a unit of the world’s largest producer of branded footwear, recorded the largest intraday plunge in its stock price since 2008, after firing its chief financial officer for publishing inaccurate sales figures, and announced the departure of its chief executive.

Shares of the company tumbled as much as 37 per cent to an intraday low of HK$1.30 in Hong Kong, wiping out HK$4.1 billion of its value. Share prices of Yue Yuen Industrial Holdings, the 62 per cent shareholder of Pou Sheng, fell as much as 9.8 per cent.

“The Company discovered on 6 January 2017 certain incorrect sales records in the month of December 2016, which could potentially lead to recognition of revenue for sales transactions that did not take place before end of year 2016,” Pou Sheng said in its filing to the Hong Kong stock exchange.

“The incident revealed weakness over the financial controls,”the Hong Kong-based company said, even though the relevant figures were not significant compared with the group’s overall revenue and did not materially affect any financial information published prior to the announcement.

The retailer said it has sacked CFO Chen Luo-leng, while CEO Kwan Heh-Der has resigned.

Pou Sheng is a spin off of Taiwan’s apparel and footwear maker Yue Yuen, which owns factories in mainland China, Vietnam and Indonesia, producing 300 million pairs of shoes every year for Nike, Adidas, Reebok, New Balance, Puma and Timberland.

Deloitte has been hired by the Hong Kong-based retailer to carry out a check on accounting records of the company, Pou Sheng said.

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.css-sioo19{color:#c79a00;}New | Shares of world’s largest footwear maker plunge on false sales data

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Shares of Pou Sheng and its shareholder Yue Yuen plunge in Hong Kong after the retailer fired its CFO for publishing false sales data

New | Shares of world’s largest footwear maker plunge on false sales data

Shares of Pou Sheng and its shareholder Yue Yuen plunge in Hong Kong after the retailer fired its CFO for publishing false sales data