[Edaily Reporter Shin Ha-yeon ] After the market closed on the 14th—the deadline for submitting semi-annual reports—a flood of negative disclosures from listed companies poured in. Companies that had received unqualified opinions last year announced “disclaimer of opinion” results for their semi-annual reviews one after another, while disclosures regarding issues that could influence investment decisions—such as negative equity and massive derivative losses—followed in quick succession, leading to a repeat of the so-called “owl disclosures.”

“Owl disclosures” refer to the practice of companies releasing unfavorable information during times when investor attention is relatively low. Typically, this term describes situations where negative announcements are concentrated in the evening hours after the market closes, such as on report submission deadlines or just before holidays.

According to the Financial Supervisory Service’s Electronic Disclosure System and the Korea Exchange on the 14th, for about an hour around 6:00 p.m. that day, nearly 20 listed companies issued fact-confirmation disclosures, including adverse semi-annual review (audit) opinions.

Among them, DAWONSYS Co., LTD(068240), KS Industry(101000), ITOXI Corp.(052770), ENZYCHEM LIFESCIENCES CORPORATION(183490), CARRY(313760), MOBILE APPLIANCE, INC.(087260), and SyntekaBio,Inc.(226330) saw their audit opinions change from “unqualified” in last year’s interim report to “disclaimer of opinion” this year. On the Main Board, ContentreeJoongAng corp.(036420)and DAEHOAL(069460)shifted from “unqualified” last year to “disclaimer of opinion” this year.

For some companies, uncertainties surrounding their ability to continue as going concerns, as well as cash transactions and internal controls, were cited as the reasons for the qualified opinions.

DAWONSYS Co., LTD received a disclaimer of opinion on both its consolidated and separate financial statements. The reasons cited included significant uncertainties regarding the going concern assumption, limitations on review procedures for the underlying consolidated financial statements, and limitations on key review procedures. Notably, total equity at the end of the first half stood at negative (-) 497.1 billion won, resulting in a negative equity ratio of 2,704.91%.

MOBILE APPLIANCE, INC. also shifted from an unqualified opinion in last year’s interim period to a disclaimer of opinion this year. The auditor cited several reasons for the disclaimer, including uncertainty affecting the financial statements as a whole due to allegations of misconduct against former management and others; the validity of certain fund transactions and the appropriateness of their accounting treatment; off-balance-sheet liabilities and contingencies resulting from weaknesses in internal controls; the scope of related parties and the completeness of transactions; and significant uncertainty regarding the going concern assumption.

SyntekaBio,Inc. received a disclaimer of opinion on both its consolidated and separate financial statements because the auditors were unable to obtain sufficient and appropriate audit evidence regarding the validity of loan transactions and the verification of their intended use. KS Industry received a disclaimer of opinion due to uncertainties regarding the going concern assumption and limitations on key audit procedures. ITOXI Corp., ENZYCHEM LIFESCIENCES CORPORATION, and CARRY also saw their audit opinions change from unqualified last year to a disclaimer of opinion this year.

Some companies received an adverse opinion this year as well, following last year. CELLUMED CO., LTD. received an adverse opinion due to limitations on the scope of the review of its underlying financial statements, the adequacy of the assessment of the recoverability of loans, and uncertainty regarding the going concern assumption. However, its negative equity ratio decreased from 69.8% in the first half of last year to 38.8% this year. MEDICOX Co., Ltd. also received a disclaimer of opinion for the second consecutive year due to significant uncertainties regarding the going concern assumption, limitations on the scope of the review of the underlying financial statements, and constraints on key review procedures.

In addition to the qualified opinions, a series of disclosures regarding deteriorating financial health and large-scale losses followed. Although EWON COMFORTECH CO., LTD received an unqualified review opinion for its interim financial statements, its capital impairment ratio reached 58.4%. CARRY reported standalone revenue of 544.46 million won for the first half of this year, falling short of 700 million won, and its second-quarter revenue also amounted to only 23.37 million won, remaining below 300 million won.

Daesung Hi-Tech Co., Ltd. announced that it incurred a loss of 11.9 billion won from derivatives transactions, primarily due to valuation losses on derivatives related to convertible bonds and redeemable convertible preferred stock. This amount represents 18.11% of the company’s equity. However, the company explained that this was an accounting loss—reflecting changes in fair value due to factors such as rising stock prices—and did not result in any actual cash outflow.

Negative announcements also emerged on the KOSPI market. For both its consolidated and separate financial statements, ContentreeJoongAng corp.’s audit opinion changed from “unqualified” last year to “disclaimer of opinion” this year. The auditor determined that there is significant uncertainty regarding the company’s ability to continue as a going concern. The company filed a petition with the Seoul Bankruptcy Court in June to commence rehabilitation proceedings and received a decision to commence the proceedings that same month. It recorded an operating loss of 1.1 billion won and a net loss of 4.8 billion won in the first half of the year, and its current liabilities exceeded its current assets by 279.8 billion won.

DAEHOAL also saw both its consolidated and separate financial statements change from an unqualified opinion last year to a disclaimer of opinion this year. The auditor stated that it was unable to perform sufficient and appropriate review procedures during the review of opening balances. The company recorded a net loss of 10.6 billion won in the first half of the year, and its negative equity ratio stood at 27.2%.

“Owl disclosures”—the practice of releasing information unfavorable to investors after the market closes, around the deadlines for submitting semi-annual and quarterly reports—recur every year. This year, with the deadline for submitting semi-annual reports falling on a Friday, critical information for investment decisions—such as qualified audit opinions, negative equity, and massive losses—was concentrated after the regular trading session ended.

Market observers point out that even if statutory filing deadlines are met, the practice of concentrating the disclosure of information critical to investment decisions during times when investor attention is relatively low needs to be improved in terms of information accessibility.

An official in the financial investment industry stated, “Since an overwhelming number of disclosures are released all at once on the semi-annual report submission deadline, important information from individual companies may easily go unnoticed by investors.” They added, “In particular, when negative information is disclosed after the market closes, investors have limited time to fully review and assess it; therefore, the more critical the information, the greater the effort needed to disclose it in a timely manner.”

Meanwhile, unlike annual business reports, semi-annual reports do not immediately result in delisting even if they receive a disclaimer of opinion. However, if the reasons for the adverse opinion are not resolved by the time the annual business report is submitted, it could lead to delisting or designation as a “monitored stock.”