In the Sci-Tech Innovation Board Daily news on September 26th, KGL Technology announced that the Chairman and General Manager, Liu Xingsheng, along with some directors and management personnel (including foreigners), voluntarily proposed a salary reduction.

The announcement stated that considering the global economic situation and the industry status of the company, and taking into account the loss-making state of the company in the first two quarters of 2024 due to the integration of overseas assets acquired earlier, some management personnel voluntarily proposed a salary reduction to actively respond to market challenges, quickly achieve the integration and turnaround of the previous M&A business, optimize cost structures, and enhance the company's competitiveness.

Among them, the Chairman and General Manager of KGL Technology, Liu Xingsheng, had his remuneration reduced by 30%; some directors, including Deputy General Manager Tian Ye, and other management personnel (including foreigners) had their remuneration reduced by 10% to 20%.

The salary adjustments for the above-mentioned management personnel will take effect from the month after the announcement is made, lasting until the company achieves two consecutive quarters of net income attributable to shareholders of listed companies after deducting non-recurring gains and losses, with a maximum salary reduction period of 12 months.

Data shows that the Chairman and General Manager of KGL Technology, Liu Xingsheng, holds 11.99 million shares of KGL Technology, with a remuneration of 1.116 million yuan as of the end of the 2023 fiscal year, which is lower than the industry average of 1.685 million yuan for the same period.

A loss of over 28 million yuan in the first half of the year.

Juguang Technology mainly engages in the research and development, production, and sales of high-power semiconductor laser components and raw materials, as well as laser optical components in the upstream photonics industry. It announced two overseas acquisitions in November 2023 and May 2024.

On the evening of November 8, 2023, Juguang Technology announced its intention to acquire 100% equity of SMO for 75.54 million euros. At that time, SMO was still in a loss-making state, and the transaction was completed in January of this year.

On the evening of May 7, 2024, Juguang Technology announced again its intention to purchase a portion of the research and production assets of micro-optical components from ams-OSRAM AG's wholly-owned subsidiaries, ams-Osram Asia Pacific Pte. Ltd. in Singapore and ams International AG in Switzerland, for 50 million euros. This transaction was completed on September 2 this year.

Due to Juguang Technology's two major overseas asset acquisitions in a short period of time, it has raised concerns among many investors. The company has held investor briefing sessions twice to publicly explain the two acquisitions.

In terms of its operating performance, Juguang Technology achieved a revenue of 0.311 billion yuan in the first half of this year, a 29.85% year-on-year increase. However, its attributable net loss for the same period exceeded 28 million yuan, a 206.71% year-on-year decrease.

It is worth noting that Kruilight Technology announced tonight (September 26) the "2024 Asset Acquisition Related Restricted Stock Incentive Plan (Draft)."

The incentive plan proposes to grant 4.5 million restricted shares to incentive recipients. Among them, the first group of incentive recipients totals 529 people (including 40 foreign employees), accounting for 51.56% of the company's total employees of 1026 people (as of September 20, 2024). In the list of first-time incentive recipients, Kruilight Technology's chairman and general manager Liu Xingsheng, as well as its concerted actors Tian Ye, Li Xiaoning, and Hou Dong, are all included.

Since the beginning of this year, many listed company executives have voluntarily taken pay cuts.

The Science and Technology Innovation Board Daily noted that this year, A-share listed companies such as Mountain Zhi Gaokai, Beijing Haixin Energy Technology, Linewell Software, Greenland Holdings Corporation, Chengdu Road & Bridge Engineering, and others have seen senior executives taking voluntary pay cuts in order to seek sustainable development for their companies.

On July 28th this year, Chairman Ye Ji of Mountain Child Technology publicly apologized for the continuous limit down of the company's stock price, stating that he will increase shareholding of the company's stocks and has applied to the board of directors to suspend his personal salary until the stock price recovers to or above 1.6 yuan per share.

Beijing Haixin Energy Technology, which has been continuously losing money in recent years, also announced on the evening of July 28th a salary reduction for the company's senior management, with reductions ranging from about 19% to 36%. The company's general manager's annual salary was reduced from 1.4 million yuan to 0.9 million yuan.

"Listed company management across the board taking pay cuts is a proactive measure in response to economic pressures and market uncertainties." said a senior market professional in an interview with the Star Daily.

"For companies facing losses or continuous pressure of falling stock prices, reducing executive compensation can directly save more funds for business development, research and development investment, and other key areas." The market professional mentioned above believes that "management pay cuts also reflect the sense of responsibility and dedication of the company's top management."