Recently, Jolywood (300393), a leading A-share photovoltaic backsheet, announced that it would terminate its investment in Gujiao City, Shanxi Province with an annual output of 200,000 tons of industrial silicon and 100,000 tons of high-purity polysilicon projects, after the total investment was expected to be 14 billion yuan.
In response to the reasons for the termination of the project, Jolywood said that since the signing of the investment agreement, the company has actively promoted the preparatory work of the polysilicon project, but the feasibility of the silicon-based project has changed significantly due to the undecided landing plan of the chemical park, the fact that the investment agreement has not taken effect, and the photovoltaic market environment has changed dramatically. It is expected that it will be difficult to achieve the expected effect if it continues to advance. After comprehensive consideration of various aspects, the company decided to terminate the investment in silicon-based projects.
The 14 billion investment has raised questions and the Shenzhen Stock Exchange has issued a letter of concern
In fact, the investment plan for this project will be retrospected to March 2022.
At that time, Jolywood signed the "Strategic Cooperation and Investment Agreement" with the Taiyuan Municipal Government and the Gujiao Municipal Government, planning to invest in an annual output of 200,000 tons of industrial silicon and an annual output of 100,000 tons of high-purity polysilicon projects in Gujiao City, with an estimated total investment of up to 14 billion yuan.
However, the company's existing monetary fund balance is less than 2 billion yuan, but it has invested as much as 14 billion yuan in polysilicon projects. In addition, the Shenzhen Stock Exchange required Jolywood to elaborate on the production plan, funding arrangements and sources, analyze the feasibility of the financing plan, and indicate the risks of fund raising, as well as the need to assess the soundness of the project investment and the impact on the existing business.
In response, the company said in its reply letter that its polysilicon investment project is planned to be constructed in phases, but the investment amount is large and there is a risk of fundraising. As of the end of September 2021, the company's book currency funds were 2.618 billion yuan, but the actual disposable funds were only 413 million yuan. The risks faced by the company include the uncertainty of its own fund raising, fund formation and fund raising, project loan approval and the timely realization of operating income. If the above-mentioned risks lead to the blockage of fundraising, the company may face the risk of slowing down the investment progress of polysilicon projects and extending the cycle.
It can be seen that the above-mentioned series of risks actually laid the groundwork for the smooth progress of the project in advance.
The involution of the industry intensified, and polysilicon prices plummeted
Objectively, since 2023, the mainland polysilicon market has changed dramatically.
In recent years, polysilicon prices have been on a rollercoaster ride down from a peak of more than 300,000 yuan/ton in the previous year to below 100,000 yuan/ton in order to compete for market share.
What's even more surprising is that by late April 2024, polysilicon prices have fallen to a range of 4-50,000 yuan/ton, hitting a record low in recent years.
According to the latest data from the Silicon Industry Branch on April 24, the average transaction price of n-type material has dropped to 49,200 yuan/ton, the average transaction price of monocrystalline dense material has dropped to 42,800 yuan/ton, and the average transaction price of n-type granular silicon has dropped to 43,000 yuan/ton.
It should be pointed out that under the severe situation of overcapacity in the domestic polysilicon market, polysilicon prices have fallen sharply, which has not only touched the production cost line of most enterprises, but also the cost line of some enterprises. In the face of this predicament, many enterprises have to take the helpless move of reducing production and stopping production, and even many enterprises have fallen into the dilemma of layoffs and bankruptcy. It can be said that the domestic photovoltaic industry is experiencing a new round of cold wave.
It can be seen that in the face of the sharp decline in upstream polysilicon prices and increasingly fierce market competition, Jolywood may not have made a wise choice to abandon its RMB 14 billion polysilicon expansion plan under relatively tight financial conditions.
暴降268% !2024Q1业绩盈转亏
According to the data, Jolywood was founded in 2008 and listed on the GEM of the Shenzhen Stock Exchange in 2014, mainly engaged in photovoltaic back film, battery modules and photovoltaic application system business.
In fact, in addition to external objective factors, Jolywood's performance in recent years has also appeared certain concerns. Just recently, Jolywood announced its 2023 annual report and the "report card" for the first quarter of 2024.
In 2023, the company will achieve revenue of 12.259 billion yuan, a year-on-year increase of 28%; attributable net profit was 527 million yuan, a year-on-year increase of about 31%; Achieved a double increase in profits.
However, in the first quarter of this year, the company achieved revenue of 1.288 billion yuan, a year-on-year decrease of 52.43%; The attributable net profit was a loss of 172 million yuan, a significant decrease of 268.11% year-on-year. This undoubtedly casts a shadow over the company's future development.
The pressure on performance VAM agreements has increased significantly
It is worth noting that at the beginning of Zheneng Power's acquisition of 9.7% of Jolywood's shares in 2023, Lin Jianwei, the actual controller of the original company, solemnly promised that Jolywood will achieve a cumulative net profit attributable to the parent company of no less than 1.6 billion yuan in the three years from 2022 to 2024, that is, an average annual profit of 533 million yuan. If this goal is not achieved, Lin Jianwei will make corresponding cash compensation to Zheneng Power.
According to the latest financial report, from 2022 to 2023, Jolywood's net profit attributable to the parent company will be 401 million yuan and 527 million yuan respectively; The total net profit for the two years was 928 million yuan, which was still about 672 million yuan short of the net profit promised at no less than 1.6 billion yuan.
Now, the company's performance in the first quarter of 2024 has suddenly "lost color", with a large loss of 172 million yuan. This sudden performance reversal undoubtedly made the company drift away from Lin Jianwei's previously promised performance targets, and the performance pressure also rose sharply. The change has added to the market's concerns about the company's future development, and Lam's performance promises have become increasingly difficult to deliver.
Therefore, in the face of the complexity and uncertainty of the current photovoltaic industry, Jolywood still needs to actively respond to market changes and adjust its business strategy to cope with the current unfavorable situation. The termination of the 14 billion yuan silicon-based project may be part of the company's adjustment.
Disclaimer: The above content is reproduced from OFweek Solar Photovoltaic Network, and the content does not represent the position of this number.