Maxim's released its first annual report after its listing on the Beijing Stock Exchange, and the company's performance continued to decline, with sales of several core products declining. It is worth noting that the major shareholder of Maxim's Yishen is also a major customer, and there are many mismatches in the related party transaction data disclosed by the two parties.
Chongqing Meixin Yishen Machinery Co., Ltd. (stock abbreviation: Meixin Yishen; stock code: 873833. BJ) is an enterprise focusing on the research, production and sales of precision mechanical parts, the company's main products include compressor crankshafts, general machine crankshafts, motorcycle crankshafts, scroll plates and accessories such as bushings, connecting rods, etc.
In November 2015, Maxim's Yishen was listed on the National Equities Exchange and Quotations (NEEQ), and later terminated its listing on the NEEQ in April 2019 due to its own development plan. In June 2022, the company was listed on the New Third Board again.
After several setbacks, in November 2023, Meixin Yishen was officially listed on the Beijing Stock Exchange, with a total of 13.8 million shares issued in the IPO, a total share capital of 82.36 million shares after issuance, an issue price of 10 yuan per share, and a total of 138 million yuan raised.
According to public information, as of now, the actual controllers of Meixin Yishen are Wang Anqing and Xu Zhengming, and the shareholding ratios of the two are 12.36% and 19.29% respectively. In addition, Chongqing Zongshen Power Machinery Co., Ltd. (stock abbreviation: Zongshen Power; stock code: 001696. SZ) holds a 15.61% stake in the company.
According to the prospectus of Meixin Yishen, from 2020 to 2022, the company achieved operating income of 407.1871 million yuan, 529.1199 million yuan and 502.2263 million yuan respectively, and net profit attributable to the parent company of 57.2761 million yuan, 61.4093 million yuan and 51.3088 million yuan, a decrease of 5.08% and 16.45% respectively in 2022.
From the perspective of sales area, the company's overseas sales account for a relatively high proportion. From 2020 to 2022, the company's overseas sales accounted for 41.87%, 42.44% and 47.59% of the main business revenue, respectively, and the main export countries and regions of export products include the United States, Mexico and Thailand.
In addition to the decline in operating income and net profit in 2022, the company's comprehensive gross profit margin also showed a significant downward trend, which was 30.83%, 25.80% and 24.81% respectively during the above reporting period. According to the prospectus, the decline in the company's performance is mainly due to the continued weakness of the domestic general machine market and the decline in the crankshaft business of low-power general machinery.
However, the sluggishness in Maxim's performance seems to be continuing. At the end of March 2024, Maxim's Yishen announced its 2023 annual report, and the performance is still not satisfactory. In addition, our research found that there are still many contradictions in the related party transaction data disclosed by the company and major shareholders.
Source: Photo.com
After the listing, the performance continued to decline
According to Meixin Yishen's 2023 annual report, the company achieved operating income of 444.3603 million yuan, down 11.52% from the same period of last year, net profit attributable to shareholders of listed companies of 43.5076 million yuan, down 15.20% from the same period of last year, net profit after deducting non-profits of 27.9795 million yuan, down 44.53% from the same period of last year, and the company's comprehensive gross profit margin fell to 23.11%, down 1.70 percentage points from the same period last year.
In terms of products, the sales revenue of the company's two core products have declined significantly.
In 2023, the revenue of compressor crankshaft products will be 202.1782 million yuan, a year-on-year decrease of 19.4874 million yuan, a decrease of 8.79%, and the gross profit margin of products will be 25.51%, a year-on-year decrease of 5.54 percentage points. General machine crankshaft products achieved revenue of 176.8268 million yuan, a year-on-year decrease of 13.6289 million yuan, a decrease of 7.16%.
In addition, starting from the second half of 2022, Meixin Yishen began to gradually reduce the production and sales of motorcycle crankshaft products with low gross profit margins, and the revenue of motorcycle crankshaft products in 2023 was 5.2726 million yuan, a year-on-year decrease of 17.7389 million yuan, or 77.09%.
In response to the continuous decline in performance, Meixinyi said that it was mainly due to the fierce competition in the domestic and foreign compressor markets, and the sales volume of the company's downstream industries such as general machinery, agricultural machinery, and garden machinery in 2023 will decline compared with the previous year, resulting in intensified market competition in the same industry, compressing the profitability of the company's general crankshaft products, thereby making the company's general crankshaft order scale and profitability decline as a whole, and compressor crankshaft products are also facing price reduction pressure.
However, according to the peer companies selected in the prospectus, Tianrun Industry (002283. SZ) achieved revenue of 4.006 billion yuan in 2023, a year-on-year increase of 27.74%, and a net profit attributable to the parent company of 391 million yuan, a year-on-year increase of 91.96%.
Fuda shares (603166. SH) is expected to achieve a net profit attributable to the parent company of 100 million yuan to 120 million yuan in 2023, an increase of 52.46%-82.95% over the same period of last year, and a net profit of 78 million yuan to 98 million yuan after deducting non-profits, an increase of 118.06%-173.97% over the same period of last year.
In contrast, Meixin Yishen showed a decline after listing, and its profit trend ran counter to that of its peers.
Major customers are also shareholders, and there are discrepancies in the data of a number of related party transactions
Zongshen Power is one of the major shareholders of the company and is a related party of the company.
It is worth mentioning that Zongshen Power is not only a major shareholder of Maxim's Yishen, but also one of the company's major customers. The prospectus disclosed that from 2020 to 2022, the amount of goods sold by Meixin Yishen to "Zongshen Group" (enterprises belonging to Zongshen Power and its affiliates) was 82.2571 million yuan, 84.3488 million yuan and 75.0395 million yuan respectively, and Zongshen Group has long ranked among the company's top five customers.
In 2023, there are still a large number of related party transactions between Maxim's Yishen and Zongshen Group, but there are many discrepancies in the data disclosed by the two companies.
According to Meixin Yishen's annual report, in 2023, the company's related sales to Chongqing Zongshen General Power Machinery Co., Ltd. (hereinafter referred to as Zongshen GM), Chongqing Zongshen Engine Manufacturing Co., Ltd. (hereinafter referred to as Zongshen Engine) and Chongqing Dajiang Power Equipment Manufacturing Co., Ltd. (hereinafter referred to as Dajiang Power), subsidiaries of Zongshen Power, will correspond to 38.5663 million yuan, 5.2077 million yuan and 10.3238 million yuan respectively, totaling 54.0977 million yuan. However, according to Zongshen Power's disclosure, the total amount of related purchases to Meixin Yishen during the same period was only 52.8806 million yuan.
Not only does the data disclosure of related party transactions not match each other, but there are also contradictions in Maxim's own annual report. It disclosed in the annual report "Major Customers" that in 2023, the company's sales amount to five "Zongshen system" companies, including Zongshen General Motors, Zongshen Engine, and Dajiang Power, will be disclosed as 53.4655 million yuan on a consolidated basis, but in the related party transactions, Meixin Yishen's related sales to Zongshen General Motors, Zongshen Engine, and Dajiang Power have reached 54.0977 million yuan.
In addition, according to the data of Meixin Yishen's annual report, as of the end of 2023, its accounts receivable book balances to Zongshen General Motors, Zongshen Engine, and Dajiang Power were 4.0608 million yuan, 502,900 yuan, and 3.7267 million yuan, respectively, with a total amount of 8.2903 million yuan. However, Zongshen Power disclosed that as of the end of the same period, the balance of accounts payable to Meixin Yishen was 9.653 million yuan.
There are many discrepancies in the data on the amount of related party transactions disclosed by Maxim's and its related parties, which party's disclosure is wrong? We raised the above question to Maxim's WingShen by email, and the reply we received was that "the data discrepancy is caused by the accounting differences between the company and related parties".
Similar data conflicts also include the number of employees in the company. According to the 2023 annual report of Meixin Yishen, the number of production personnel at the beginning of the period (at the end of 2022) was 701, but according to the data of its 2022 annual report, the number of production personnel of the company and its subsidiaries at the end of the period was 874. The difference between the two annual reports on the number of production personnel at the same time is 173.
In response to the above questions, Maxim's reply was that "the above-mentioned personnel discrepancies are caused by the differences in the disclosure caliber of the annual reports". However, the scope of "production personnel" has not been defined in detail in the two annual reports, so what is the "caliber difference"?