Mongoli's performance will decline in 2023, and the management will be "replaced" after listing

Recently, Tianjin Guoan Mongguli New Material Technology Co., Ltd. (stock abbreviation: Mongguli; Stock Code: 301487. SZ) has published its 2023 annual report and 2024 first quarter report. In 2023, MGL will achieve a net profit attributable to the parent company of 60.0067 million yuan, a year-on-year decrease of 35.01%; In the first quarter of 2024, MGL achieved a net profit attributable to the parent company of 2.9653 million yuan, a year-on-year decrease of 78.88%.

In addition to the sharp decline in performance, our research found that the information disclosed in the annual report of Mongoli not only contradicted the information disclosed by related parties, but also contradicted the announcements disclosed by itself, and the quality of information disclosure seemed to need to be improved. In addition, since MGL's listing in August 2023, the management has undergone a "major change", with a total of 1 general manager, 4 deputy general managers, and 1 chief financial officer leaving.

Source: Photo.com

In 2023, the performance will decline, and the fundraising project will be postponed

Mongoli is mainly engaged in the research and development, production and sales of cathode materials for new energy batteries, including lithium cobalt oxide and ternary cathode materials. In August 2023, MGL was listed on the Growth Enterprise Market (GEM). Recently, Mongoli released its first annual report after listing.

In 2023, MGL will achieve operating income of 2,359,886,000 yuan, a year-on-year decrease of 27.03%; the net profit attributable to the parent company was 60.0067 million yuan, a year-on-year decrease of 35.01%; The net profit attributable to the parent company after deducting non-profits was 48.2179 million yuan, a year-on-year decrease of 42.77%. From 2020 to 2022, MGL's operating income will be 1645.702 million yuan, 2826.8056 million yuan, and 3233.8428 million yuan respectively, with a year-on-year growth rate of 3.69%, 71.77%, and 14.40% respectively; The net profit attributable to the parent company was 79.9546 million yuan, 104.5313 million yuan and 92.3286 million yuan respectively, with a year-on-year growth rate of 1107.30%, 30.74% and -11.67% respectively. The net profit attributable to the parent company in 2023 is no longer at the level of 2020.

The annual report shows that in 2023, the average sales price of Mongoli's main products, lithium cobalt oxide and ternary cathode materials, will decline sharply. Among them, the average price of lithium cobalt oxide products excluding tax decreased by 37.22% compared with the beginning of the year, and the average price of ternary material products excluding tax decreased by 32.80% compared with the beginning of the year.

According to the statistics of Choice Financial Terminal, from a quarterly point of view, from the first to the fourth quarter of 2023, the single-quarter operating income of Mongoli was 610.9983 million yuan, 594.3585 million yuan, 569.0959 million yuan, and 585.4333 million yuan respectively, with a year-on-year growth rate of -37.53%, -19.51%, -32.57%, and -13.06% respectively; The net profit attributable to the parent company was 14.0415 million yuan, 27.3658 million yuan, 18.7471 million yuan and -147,700 yuan respectively, and there was a loss in the fourth quarter.

In the first quarter of 2024, Mongoli's business situation does not seem to improve. In the first quarter, MGL achieved an operating income of 349.691 million yuan, a year-on-year decrease of 42.77%, and a net profit attributable to the parent company of 2.9653 million yuan, a year-on-year decrease of 78.88%. MGL said that the company's operating income declined in the first quarter of 2024, mainly due to the sharp year-on-year decline in raw material prices, which led to a decline in the sales price of the company's products. In addition, the decrease in government subsidies is also one of the main reasons for the decline in the company's performance.

The "Industrialization Project of Cathode Materials for Lithium-ion Batteries with an Annual Output of 10,000 Tons" is an IPO fundraising project of MGL, which will build a new ternary material production capacity. In April 2024, MGL announced that it intends to extend the time for the fundraising project to reach the intended usable state from April 2024 to June 2025.

MGL said in its annual report that the fundraising project failed to reach the intended usable state in April 2024, which was originally planned, mainly due to the company's ternary material product certification and customer development progress was not as expected. In 2023, the fundraising project failed to achieve the expected returns, mainly due to the fact that the company's new customers of ternary materials, the certification of new products, trial production and stable mass production all require a certain period. At the same time, the fluctuation and downward trend of upstream raw material prices has had a certain adverse impact on the benefits of the products of the fund-raising projects.

2022 is the last year of the reporting period of MGL's prospectus, and the capacity utilization rate of ternary materials in that year is only 46.52%. According to the annual report, in 2023, the capacity utilization rate of Mongoli ternary materials will be 29.75%.

The quality of information disclosure seems to need to be improved, and the management has a "big change" after listing

Hengtong Group Co., Ltd. (hereinafter referred to as Hengtong Group) is the indirect controlling shareholder of MGL, and Jiangsu Hengtong Optoelectronics Co., Ltd. (stock abbreviation: Hengtong Optoelectronics; Stock Code:600487. SH) is an enterprise controlled by Hengtong Group, and MGL is a related party of each other.

Jiangsu Hengtong Power Cable Co., Ltd. (hereinafter referred to as: Hengtong Power Cable), Suzhou Hengtong Gloria Resort Hotel Co., Ltd. (hereinafter referred to as: Hengtong Kailai), Jiangsu Hengtong Cable Technology Co., Ltd. (hereinafter referred to as Hengtong Cable), Kaibus Industrial Electrical Cable (Suzhou) Co., Ltd. (hereinafter referred to as Kaibus), Jiangsu Hengtong Electronic Cable Technology Co., Ltd. (hereinafter referred to as Hengtong Electronic Cable), Jiangsu Hengtong Electric Power Intelligent Network Technology Co., Ltd. (hereinafter referred to as Hengtong Electric Power Intelligent Network) is a subsidiary of Hengtong Optoelectronics.

According to the annual report of Mongguli, in 2023, Mongoli will purchase 791,800 yuan from Hengtong Optoelectronics, and purchase 389,400 yuan, 99,000 yuan, 24,100 yuan, 16,900 yuan, and 9,400 yuan from Hengtong Power Cable, Hengtong Kailai, Hengtong Cable, Kaibus, and Hengtong Electronic Cable, respectively. According to this calculation, in 2023, the related procurement amount of MGL to Hengtong Optoelectronics will be 1.3307 million yuan.

However, according to the annual report of Hengtong Optoelectronics, in 2023, Hengtong Optoelectronics will sell 7,700 yuan of labor services, 1,158,200 yuan of goods sold, 93,100 yuan of catering and accommodation to Mongguli, and sell 9,800 yuan of goods to Beijing Mongoli New Material Technology Co., Ltd., a subsidiary of Mongguli. According to this calculation, the related sales amount of Hengtong Optoelectronics to Mongguli in 2023 will only be 1.2689 million yuan.

In terms of details, Hengtong Optoelectronics said that it would provide 93,100 yuan of catering and accommodation to Mongguli in 2023, but Mongoli said that it would purchase 99,000 yuan of catering and accommodation from Hengtong Kailai, a subsidiary of Hengtong Optoelectronics, in 2023.

In addition, the annual report of MGL shows in the "Related Party Transactions" and "Procurement of Goods/Acceptance of Labor Services" that in 2023, MGL and Hengtong Optoelectronics will pay 225,400 yuan of social security provident fund, and Hengtong Power Intelligent Network will pay 7,700 yuan of social security provident fund, but Hengtong Optoelectronics's annual report does not disclose the above information.

In addition, there appear to be contradictions in the information disclosed by Mongoli. According to the annual report of MGL, in 2023, MGL purchased 389,400 yuan of cables from Hengtong Power Cable, but according to the information disclosed in the "Announcement on the Expected Daily Connected Transactions in 2024" issued by MGL, in 2023, MGL purchased 308,800 yuan of cables from Hengtong Power Cable.

Directors, supervisors and senior executives are related parties of listed companies. According to the "Remuneration of Directors, Supervisors and Senior Managers" section of MGL's annual report, in 2023, MGL's directors, supervisors and senior executives (including departed personnel) will receive a total of 4.3868 million yuan in remuneration from MGL. However, according to the Related Party Transactions Office of the annual report, in 2023, the remuneration of key management personnel of MGL will be 6.83 million yuan.

In addition, we found that in less than a year since its listing in August 2023, the management of MGL has undergone very big changes, with its former general manager, 4 deputy general managers, and 1 chief financial officer leaving one after another, and its management does not seem to be very stable.

Specifically, in October 2023, Sun Yixing, the former director of MGL, applied for resignation as a director of the company for personal reasons; In November 2023, Huang Guohua, the former deputy general manager of MGL, applied for resignation as the company's deputy general manager for personal reasons; In January 2024, Zhu Weiquan, the former chairman and general manager, Chen Jin, director and deputy general manager, Liu Zhonghua, deputy general manager, and Zhou Qingbao, deputy general manager, all resigned due to the expiration of their terms. In March 2024, Yun Xiaojun, the former chief financial officer of Mongoli, applied for resignation as the company's chief financial officer for personal reasons.

In fact, Yun Xiaojun's original term of office was from January 3, 2024 to January 2, 2027. In other words, Yun Xiaojun resigned as the company's chief financial officer at the beginning of his new term of office and before the disclosure of Mongoli's annual report.