oh dear, not good..
PET is investigating accounting irregularities in its China operations (see ASX announcement here)
I'll be blunt, this is very bad news and comes after missed guidance and director selling. China accounts for something like 85% of sales.
(remember, with shares suspended you cant sell your Strawman holdings either. Not until trade resumes).
What's more concerning for me, is that PET's deputy Chairman Zhigang Zhang was a strategic investor in Envirosuite (EVS) and has helped establish their operations in China.
14% of the groups revenues were from China, and there could be some concern that there are "irregularities" there too.
Twitter user Nick Fabrio outlined some concerns here:
https://twitter.com/longhorncapital/status/1307891849101635584
I'm not inclined to jump to any conclusions just yet. There's little hard facts out there right now and i'm still digging through things -- maybe it's nothing.
There's often a few 'hairs' on small cap companies that don't amount to anything -- and jumping at every shadow can be very counterproductive.
At the same time, it's hardly encouraging news. I hope EVS have chosen their partners well.
