KUALA LUMPUR (Oct 15): Bursa Malaysia Securities Bhd has publicly reprimanded sand mining company TXCD Bhd (KL:TXCD), formerly Ageson Bhd, and five of its former directors for breaching listing rules due to the delayed issuance of its annual report.

The five were also fined a total of RM134,200 for "permitting TXCD to commit the breach", Bursa said in a statement Wednesday. They are former executive directors Datuk Seri Liew Kok Leong and Datuk Seri Chin Kok Keong, as well as former independent and non-executive directors Lim Yit Kiong, Tajul Arifin Mohd Tahir, and Evelyn Lui Ming Foong.

Bursa said TXCD, which is also involved in construction and property development, had failed to issue its annual report, including the audited financial statements, and the auditors' and directors' reports, for the 18-month financial period ended Dec 31, 2022, by the due date of April 30, 2023. The report was eventually released on Oct 31, 2023, following a six-month delay.

Bursa said TXCD's failure to issue the annual report on time was mainly due to the resignation of its external auditors in February 2023, about two months before the due date. But this was "not entirely beyond the control of TXCD based on the facts and circumstances", Bursa noted.

It also noted that TXCD and the former directors had failed to demonstrate reasonable steps taken to resolve issues with its auditors to ensure the report could be issued on time, nor did they make any reasonable enquiry on their resignation, "which was a key and material event requiring close scrutiny of the board".

Highlighting the seriousness of the breach, Bursa said it has also directed TXCD to ensure its board of directors reviews and assesses the adequacy and competency of the company's finance and accounting resources, as well as the implementation and effectiveness of its financial reporting policies and procedures.

TXCD only managed to appoint new auditors four and a half months later, in July 2023. But on the issuance of the delayed annual report, the new auditors expressed a disclaimer of opinion on TXCD's financial statements, leading the company to be classified as a Practice Note 17 issuer, indicating financial distress.

TXCD's shares closed 0.5 sen higher at 9.5 sen on Wednesday, with a market capitalisation of RM30 million.