Yangtze River Business Daily reporter Shen Yourong
Inner Mongolia's richest man Du Jiangtao's Junzheng Group (601216. SH) operating results declined.
On April 25, Junzheng Group disclosed its 2023 annual report, in which the company's operating income exceeded 19 billion yuan, down more than 10% year-on-year, and the net profit attributable to shareholders of the parent company (hereinafter referred to as "net profit") exceeded 2.7 billion yuan, down more than 30% from the previous year.
In 2020, Junzheng Group's net profit reached 4.815 billion yuan, compared with the net profit of more than 2 billion yuan after three consecutive years of decline.
Junzheng Group's business involves energy and chemical industry, logistics, degradable plastics, photovoltaics, etc. As for the decline in performance in 2023, the company said that it was due to the decline in product prices.
In the first quarter of this year, the company's profit exceeded 700 million yuan, which continued to decline year-on-year.
In 2023, Junzheng Group's operating cash flow will be less than 1 billion yuan, a year-on-year decrease of 3.106 billion yuan, which is abnormal. The company explained that it was mainly caused by the settlement of bank acceptance bills.
It is worth noting that the dividend rate of Junzheng Group has risen sharply. In 2021 and 2022, the company's dividend rate will be around 30%. In 2023, the company's cash dividend will be 2.7 billion yuan, and the dividend rate will rise to 99%, basically dividing all the profits earned. Among them, the Du Jiangtao family will share about 1.441 billion yuan.
Net profit continued to decline in the first quarter
The global market environment is complex and changeable, and the business operation is facing increasing uncertainties, and Junzheng Group, which has always had strong profitability, has not been effectively curbed in the decline in operating performance.
According to the latest disclosure of the first quarter report of 2024, Junzheng Group achieved an operating income of 5.198 billion yuan, a slight increase of 1.99% year-on-year, and a net profit of 712 million yuan, a year-on-year decrease of 14.19%.
In 2023, the company's revenue and net profit will both decline. The company's operating income was 19.124 billion yuan, a decrease of 2.336 billion yuan over the same period of last year, a year-on-year decrease of 10.88%, and the net profit and net profit after deducting non-recurring gains and losses (hereinafter referred to as "non-net profit") were 2.723 billion yuan and 2.402 billion yuan respectively, a year-on-year decrease of 34.50% and 25.31%, all of which were double-digit declines.
In 2021 and 2022, the company's operating income will be 19.297 billion yuan and 21.460 billion yuan respectively, a year-on-year increase of 30.35% and 11.21%, both of which are growing. However, the corresponding net profit was 4.536 billion yuan and 4.157 billion yuan respectively, down 5.79% and 8.35% year-on-year respectively, both of which were declining.
To sum up, from 2021 to 2023, the company's net profit has declined for three consecutive years, and it will continue to the first quarter of 2024. Among them, the decline in 2021 and 2022 will be in single digits, and the decline will expand significantly in 2023.
In the 2023 annual report, Junzheng Group said that the global economic environment is full of uncertainties, industry competition continues to intensify, the prices of the company's main products have fallen, while the prices of raw materials and fuels are still at a high level. At the same time, the company adopts effective incentive measures to promote the continuous improvement and upgrading of production, operation and management. The company's original production system operated steadily, the chemical logistics sector continued to improve management and operational efficiency, achieved good operating performance, and new projects were constructed in an orderly manner.
In 2023, Junzheng Group's management expenses will increase significantly, reaching 1.506 billion yuan, a year-on-year increase of 37.46%. The company's operating cost was 14.614 billion yuan, a year-on-year decrease of 1.447 billion yuan.
The factors affecting the company's net profit also include: net investment income of 218 million yuan, a year-on-year decrease of 983 million yuan, mainly due to the decrease in investment income of associates and joint ventures, the company's asset impairment loss (including credit impairment loss) of 37 million yuan, a year-on-year decrease of 119 million yuan, and asset disposal income of 103 million yuan, an increase of 102 million yuan year-on-year.
In recent years, the company's gross profit margin and net profit margin have declined significantly. In 2018, the company's gross profit margin was 44.68%, and in 2023, it was 23.59%, a decrease of more than 20 percentage points. In 2020, the company's net profit margin was 32.34%, and in 2023, it was 14.71%, a decrease of more than 50%.
Operating cash flow was 993 million, a decrease of 75.77%
One of the operations of Junzheng Group was unexpected, that is, the company paid a large cash dividend.
According to the 2023 profit distribution plan, Junzheng Group intends to distribute a cash dividend of 0.32 yuan (tax included) per share to all shareholders, and based on the company's total share capital of about 8.438 billion shares by the end of 2023, a total cash dividend of about 2.7 billion yuan (tax included) will be distributed, accounting for 99.16% of the company's net profit for the year. Basically, it is to divide all the profits made in the current year.
In 2021 and 2022, the cash dividends distributed by the company were 1.367 billion yuan and 1.569 billion yuan respectively, accounting for 30.14% and 36.53% of the net profit of the year.
Junzheng Group's move to pay such dividends is related to the improvement of the company's financial situation. As of the end of 2023, the company's debt-to-asset ratio was 31.25%. At the end of the period, the company's monetary funds were 4.174 billion yuan, corresponding short-term borrowings of 1.317 billion yuan, non-current liabilities due within one year of 961 million yuan, long-term borrowings of 912 million yuan, and long-term and short-term debts totaled 3.190 billion yuan. In that year, the company's financial expenses were -103 million yuan, and in the first quarter of this year, it was -31 million yuan.
Part of the construction of Junzheng Group was completed. According to the disclosure of the first quarter report of this year, the company's annual output of 26×0000 tons of BDO and 21×0000 tons of PBAT/PBS/PBT/PTMEG green recycling industry Phase I project supporting the raw material calcium carbide capacity replacement and integration technology upgrading project, the annual output of 3 million tons of coking integration and upgrading supporting projects and the annual output of 550,000 tons of coke oven gas/calcium carbide furnace tail gas to methanol comprehensive utilization project have completed the overall construction, and have been transferred to trial production in stages.
However, the company has a new move. On the evening of April 25, the company disclosed that in order to further optimize the company's fleet structure, expand the scale of the fleet, actively build a chemical transportation fleet with high economy and strong competitiveness, and continuously improve the company's competitiveness, the company's wholly-owned overseas subsidiary signed a contract with China Merchants Jinling Shipyard for the construction of five 25.9K dwt chemical ships, and reserved the order option of no more than five ships of the same type. The total price of all the above-mentioned chemical vessels shall not exceed 3.2 billion yuan including tax.
In addition, in 2023, Junzheng Group's operating cash flow will be 993 million yuan, a decrease of 3.106 billion yuan, or 75.77%, from 4.099 billion yuan in the same period of the previous year.
In this regard, the company explained that the sales proceeds of the energy and chemical sector are mainly settled through bank acceptance bills, and the company's new project construction funds are in large demand, and the bank acceptance bills received from daily sales receivables are mainly used to pay for new projects and equipment and materials after meeting the payment of suppliers for daily operation and procurement, and the amount of cash realized at maturity is small, resulting in a year-on-year decrease in cash inflow from operating activities. The company's production and operation cash payment items were basically flat year-on-year, and the net cash flow from operating activities decreased year-on-year.
As of the end of 2023, Du Jiangtao, the actual controller of Junzheng Group, directly holds 31.95% of the company's equity, Wuhai Junzheng Technology Industry Group Co., Ltd. (hereinafter referred to as "Junzheng Technology") holds 21.41% of the company's equity, Du Jiangtao and his spouse Hao Hong hold a total of 70% of the equity of Junzheng Technology, and Du Jiangtao's brother Du Jiangbo holds 30%. The Du Jiangtao family holds a total of 53.36% of the shares of Junzheng Group.
In 2023, Junzheng Group will pay a cash dividend of 2.7 billion yuan, and the Du Jiangtao family will receive about 1.441 billion yuan.
As of the end of March this year, Du Jiangtao pledged a total of about 443 million shares of Junzheng Group.
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