Apple supplier AAC Technologies defends profit margins after Gotham City's scathing report

Shruti Tripathi Chopra
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AAC Technologies is listed in Hong Kong (Source: Getty)

Apple supplier AAC Technologies defended its profit margins today for the second time after short seller Gotham City slammed the Hong Kong-listed company's profit margins in a report last week.

Last week, Gotham City accused the AAC of using "dubious accounting" practices to overstate its profits since 2014. This led to the Apple supplier's shares dropping over 14 per cent. AAC branded the report "misleading" in a response on Thursday last week.

Read more: Shares in Apple supplier AAC Technologies drop after short-seller report

AAC said today: "The company is a world-class total technology solution provider. The company delivers customer focused solutions across many technology segments.

"Not only has the company invested in advanced materials research, product designs and building up intellectual property portfolio, the company has also invested heavily in manufacturing automation to achieve operational excellence in manufacturing efficiency. The above form the bases of the company’s good gross margins achieved."

AAC chairman Koh Boon Hwee said last week: "The board vigorously denies the allegations in the report and considers the information contained therein to be inaccurate and misleading."

In 2014, Gotham City Research published a dossier on claims processor Quindell that wiped about £900m from the FTSE-listed firm's market valuation. Quindell rejected the allegations and threatened legal action at the time.

At the time of writing, shares in AAC Technologies were down 4.43 per cent at 91.75 Hong Kong dollars.

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