Farben Information's net profit fell twice in a row, and the stock price continued to break, Yan Hua's pledge rate was 61%, and the equity was transferred at a discount of 200 million yuan

Yangtze River Business Daily News ● Yangtze River Business Daily reporter Huang Cong

Farben Information in the repurchase period (300925. SZ) stock price has risen, and Yan Hua has begun to cash out.

On July 6, the announcement released by Farben Information showed that Yan Hua, the controlling shareholder and actual controller of the company, signed the "Share Transfer Agreement" with Jinan Huiying to transfer 25.29 million shares of the company's unrestricted tradable shares, accounting for 5.99% of the company's total share capital.

According to the announcement, the price of the share agreement transfer is 8.28 yuan per share (80% of the closing price of the trading day before the agreement signing date), and the total share transfer price (including tax) is 209 million yuan.

It should be noted that in 2022 and 2023, the year-on-year changes in the net profit of Farben Information will be -4.44% and -12.57% respectively, which has declined for two consecutive years.

In March 2024, Farben's information announcement showed that 61.26% of the shares held by Yan Hua were pledged, accounting for 18.69% of the company's total share capital.

Revenue growth slowed down and net profit declined

Listed in October 2020, Farben Information is a provider dedicated to providing customers with professional software technology and solution services.

In 2020 and 2021, the company's operating income was 1.948 billion yuan and 3.088 billion yuan, respectively, an increase of 49.06% and 58.55% year-on-year; The net profit was 122 million yuan and 135 million yuan respectively, an increase of 26.66% and 11.28% year-on-year respectively.

However, in the next two years, the growth rate of Farben's revenue slowed down, and its net profit even declined.

According to the data, in 2022 and 2023, the operating income of Farben Information will be 3.586 billion yuan and 3.885 billion yuan respectively, an increase of 16.11% and 8.33% year-on-year respectively; The net profit was 129 million yuan and 113 million yuan respectively, an increase of -4.44% and -12.57% year-on-year respectively.

In this regard, in the 2023 annual report, Farben Information stated that the company still maintained positive growth in revenue scale in the severe and complex external environment such as weak market demand, weak social expectations, and economic restructuring shocks.

In the first quarter of 2024, the performance of Farben Information began to pick up, and the company achieved operating income of 1 billion yuan, a year-on-year increase of 13.36%; The net profit was 31.5913 million yuan, a year-on-year increase of 10.24%.

It is worth mentioning that in March 2024, Farben's information announcement showed that 61.26% of the shares held by Yan Hua were pledged, accounting for 18.69% of the company's total share capital.

According to the announcement, Yan Hua has no pledged shares that will expire in the next six months, and the number of pledged shares that will expire in the next year is 74.04 million shares, accounting for 56.60% of the total shares of the company directly held, accounting for 17.27% of the company's total share capital, and the corresponding financing balance is 311 million yuan.

At that time, Farben Information stated that if there was a risk of liquidation in the future, Yan Hua would respond by early repayment, margin call, supplementary pledge, etc.

Sell equity at a discount of more than 200 million

On July 6, the announcement released by Farben Information showed that Yan Hua, the controlling shareholder and actual controller of the company, and Jinan Huiying Investment Partnership (Limited Partnership) (hereinafter referred to as "Jinan Huiying") signed the "Share Transfer Agreement" on July 3, and Yan Hua intends to transfer 25.29 million shares of the company's unrestricted tradable shares held by him to Jinan Huiying by way of agreement transfer, accounting for 5.99% of the company's total share capital.

Farben Information said that this equity change is based on Jinan Huiying's confidence in the company's sustainable and stable development in the future and recognition of the company's value, and does not touch the tender offer, will not lead to the change of the company's controlling shareholders and actual controllers, and does not harm the interests of listed companies and other shareholders.

After this change in equity, the controlling shareholder, actual controller and persons acting in concert with Farben Information hold a total of 137 million shares of the company, accounting for 32.36% of the company's total share capital, and Jinan Huiying holds 25.29 million shares of the company, accounting for 5.99% of the company's total share capital, becoming a shareholder of more than 5% of the company's shares.

According to the announcement, the price of the share agreement transfer is 8.28 yuan per share (80% of the closing price of the trading day before the agreement signing date), and the total share transfer price (including tax) is 209 million yuan.

This also means that Yan Hua, the actual controller of Farben Information, has cashed out more than 200 million yuan through this share transfer.

According to the announcement, Jinan Huiying was established on July 3, 2024, apparently specifically for this transaction.

According to industrial and commercial information, Jinan Huiying is 74.07% owned by Yunnan International Trust Co., Ltd. (hereinafter referred to as "Yunnan Trust"), and Zibo Tiefa Hengrui Investment Partnership (Limited Partnership) and Jinan Quanfa Investment Partnership (Limited Partnership) hold 25.93% and less than 0.01% of the shares respectively.

A total of 27.19 million yuan was invested to repurchase 3.6 million shares

It should be noted that Yan Hua's cash-out is in the repurchase period of Farben information.

In February 2024, the repurchase report released by Farben Information showed that the company's repurchase amount shall not be less than RMB 25 million and not more than RMB 50 million (both inclusive).

For this repurchase, Farben Information said that it is based on the judgment of the company's value and firm confidence in the future sustainable development, in order to establish a sound long-term incentive and restraint mechanism, improve team cohesion and competitiveness, fully mobilize the enthusiasm of the company's senior management personnel and core backbone personnel, and help the company's long-term development, in the case of comprehensive consideration of the company's financial situation and future profitability, according to relevant regulations, the company intends to use its own funds to repurchase part of the public shares in a centralized bidding transaction. It is used for the later implementation of equity incentive plans or employee stock ownership plans.

On July 2, Farben Information announced that as of June 30, 2024, Farben Information had repurchased 3,603,300 shares through the Shenzhen Stock Exchange trading system in a centralized bidding transaction, accounting for 0.84% of the company's total share capital, with the highest price of 7.90 yuan/share and the lowest price of 7.31 yuan/share, and the total amount of funds paid was 27.1919 million yuan (excluding transaction costs).

It should be noted that when the repurchase announcement was issued, the share price of Farben Information once fell to 6.84 yuan per share, a new low after the company's listing.

As of the close of trading on July 1, the share price of Farben Information reached 10.02 yuan per share, an increase of more than 46% from the above trough.

Moreover, as of the close of trading on July 5, the share price of Farben Information reached 9.65 yuan per share, far lower than the issue price of 20.08 yuan per share and the opening price of 36 yuan per share on the first day. Moreover, the company's stock price has continued to break since December 2021.