Another listed company stepped on Lei Hengda, and Wenke Garden is expected to lose a maximum of 1.8 billion yuan in 2021. (Image source: Adobe Stock)
[See China January 17, 2022 News](See a comprehensive report by Chinese reporter Ding Xiaoyu) Another “step on thunder”EvergrandeofListed company liberal arts gardenIt was tragic, with a huge loss of 1.8 billion yuan, equivalent to the company’s 10-year net profit. That is to say, all the money this company has earned over the past 10 years has helped Evergrande. As soon as the news came out, 20,000 shareholders were stunned.
According to a report by China Fund News on January 16, on the evening of January 14, the listed company Wenke Garden issued a performance forecast saying that the maximum loss in 2021 is expected to be 1.8 billion yuan (RMB, the same below). Depreciation provision is made for receivables of large groups. Notes receivable and accounts receivable totaled 1.879 billion yuan. In the same period last year, the performance of Wenke Garden was a profit of 160 million yuan, a year-on-year loss.
The announcement shows that Wenke Garden has received due commercial acceptance bills issued by Evergrande Group and its member companies since June 2021, and has suffered large-scale defaults since June 2021.
As of December 31, 2021, the company held a total of 1.442 billion yuan of notes receivable issued by Evergrande Group and its member companies, of which overdue and outstanding notes were 704 million yuan and outstanding notes were 738 million yuan; accounts receivable 437 million yuan. Notes receivable and accounts receivable totaled 1.879 billion yuan.
According to reports, the cooperation between Wenke Garden and Evergrande has a long history, and it mainly undertakes garden projects of Evergrande Group and its member companies. Evergrande has been the company’s largest customer for many years.
It is understood that although some projects of Wenke Garden have resumed work recently, local regulatory authorities and Evergrande Group and its member companies cannot honor or pay the pre-construction accounts related to the resumption projects, and cannot promise the payment time of pre-construction accounts.
As of now, the stock price of Wenke Garden is 4.08 yuan, and the total market value is 2.09 billion yuan. According to statistics, since Wenke Garden has operating data in 2011, the total net profit attributable to the parent in the past 10 years is 1.485 billion yuan.
Some stockholders said: “The company has worked hard for 10 years, and it has been lost in one year without even panties.” “It has lost the profits of the past ten years in one year.”
As of the end of the third quarter, Wenke Garden had a total of 20,700 shareholders.
According to its disclosed prospectus, in the three years from 2012 to 2014, the total revenue contributed by the top five clients of Wenke Garden to the company accounted for 59.10%, 63.24% and 59.60% of the company’s operating income for that year, respectively. However, Wenke Garden still stated that during the reporting period, the company did not have a situation in which the operating income from a single customer accounted for more than 50% of the company’s total operating income or was heavily dependent on a single customer.
Among them, Evergrande Real Estate is the company’s largest customer, and its revenue accounts for 38.02%, 34.33%, and 37.08%, more than one-third for three consecutive years.
Excessive reliance on “big customers” has made Wenke Garden repeatedly questioned by institutional investors.
In September 2021, Wenke Garden also stated on the interactive platform that the company currently has orders of about 2 billion yuan for Evergrande business. However, the total operating income of Wenke Garden in 2020 is only 2.52 billion yuan. Evergrande’s business accounts for almost 80% of the total business volume of liberal arts gardens.
At the end of 2021, Li Congwen and Zhao Wenfeng, the actual controllers of Wenke Garden, signed an equity transfer agreement with the state-owned Foshan Jiantou, transferring all the equity to Foshan Jiantou and cashing out.
According to the agreement, Foshan Construction Investment plans to transfer 6.04% of the shares of Wenke Garden held by Zhao Wenfeng and 16.96% of Wenke Garden held by Wenke Holdings through agreement transfer. At the same time, from the date of completion of the share transfer, Wenke Holdings entrusted all its remaining 3.80% of the voting rights to Foshan Jiantou. The actual controller of the company was changed to Foshan State-owned Assets Supervision and Administration Commission.
According to the non-public issuance of A shares released by Wenke Garden, the company’s net assets in the first three quarters of 2021 will be 5.696 billion yuan, with an asset-liability ratio of 70.49%.
Editor in charge: Jing Xin Source: Watch China
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