The scallops that died and came back to life on Zhangzi Island

Once the king of A-shares, he is now facing a critical point of delisting. Zhangzidao scallops have fled and died several times, but their essence is that there is a problem with the management of the group. A ship with only one man at his helm is hard not to deviate from the course.

Written by | Wang Beihao edited | Chen Dachai produced | In July this year, Wu Hougang once said such a sentence, "Investors choose the marine industry, that is, they choose risk accompaniment." Only through practice can there be a feeling of pain. Nowadays, it is not surprising that this sentence is a slur.

Zhangzidao scallops "ran away" again

On November 12, the whole people were still immersed in the miracle created by the Double Eleven carnival, but Zhangzidao, which once held A shares, suffered a one-word drop at the opening. The originally low share price of 3 yuan per share fell to 2.7 yuan, equivalent to 17.5% before the suspension of trading in 2014, setting a new low price in the brand's history. But just a month ago, Zhangzidao's scallops were not abnormal, and relevant reports showed that as of the end of October, the company had harvested a total of 147,000 mu of Ezo scallops at the end of 2017, with an average yield of 25.61 kg per mu, in line with the usual yield. In the face of the letter of concern issued by the Shenzhen Stock Exchange, asking the company to explain whether the risk of inventory impairment of bottom-sown Ezo scallops will seriously affect the performance composition in 2019, the reasons for the large-scale death of Ezo scallops, and whether there are signs of concealment of impairment, Wu Hougang, chairman of Zhangzidao, publicly responded the next day. Wu Hougang said that the mortality rate of scallops is more than 90%, scallops are just dead, and soft tissue is still attached to scallop shells, and the specific reasons are still under investigation. In the face of this statement, the public began to question Zhangzidao as a habitual "throwing pot scallop", and public opinion continued to ferment.

Scallop escape

The scallop guessing war began in 2014, and Zhangzidao explained that because of a cold water ball in the Northern Yellow Sea that happened once in decades, Zhangzidao sowed about 1 million mu of Ezo scallops in 2011 and 2012, with a loss of 800 million yuan. In 2018, Zhangzidao scallops staged another starvation drama. In January, Zhangzidao suddenly announced that a shortage of scallop bait due to the reduction in precipitation in 2017, coupled with the sea temperature, led to a large number of scallops starving to death. In the first quarter financial announcement of 2019, Zhangzidao said that it lost 43.14 million yuan in the first quarter, a year-on-year decline of 379.43%, to which Zhangzidao explained that the Ezo scallop disaster led to a sharp decline in production and sales. The scallops, which could not speak, became the gold medal of the company's quarterly financial situation, until the CSRC issued a letter pointing out that Zhangzidao was suspected of financial fraud and false records. On the evening of July 10, 2019, Zhangzidao received the "Advance Notice of Administrative Penalties and Market Prohibition" issued by the China Securities Regulatory Commission, and the company and 23 relevant personnel will be punished by the CSRC, and Chairman Wu Hougang will be banned from the market for life.

Scallops are not easy, zhangzidao should be cherished

Scallops have brought fame and wealth to this small island, relying on high-quality seafood and moderate prices, Zhangzidao aquatic products to South Korea, the United States, Canada and other countries, in 2005, that is, the fourth year of Wu Hougang's helm, has achieved an output value of 520 million yuan, a net profit of 150 million yuan, export earnings of 170 million yuan. In 2006, Zhangzidao Group was listed in Shenzhen, and the stock price has maintained an upward trend in the following years, setting a record of 151.23 per stock price in January 2008, becoming the well-deserved stock king of Shanghai and Shenzhen and the first 100-yuan stock of China's agriculture. Wu Hougang himself thus transformed into a billionaire. The islanders all own the shares, and the dividends from the rising stock price have rapidly improved the lives of the residents. Building a two-story building and driving a car are basic operations, and the welfare of the island is the envy of outsiders. Kindergartens, student apartments, and nursing homes on the island are all free, and the Zhangzidao town government will invest a lot of money every year to issue various types of subsidies such as equity benefits, pensions, and scholarships for teaching assistants. The collective economic model turned the island's affluent life into a paradise that everyone envied, until the first escape of scallops in 2014 shattered the myth. First and foremost are the islanders, who only have the right to earn, not the right to trade, and now the stock price has plummeted and there is no way to sell, and the previous group's income dividends have now stopped. According to the Rules Governing the Listing of Stocks on the Shenzhen Stock Exchange, if the closing price of A shares on the Shenzhen Stock Exchange is lower than the par value of the shares for 20 consecutive trading days, the Shenzhen Stock Exchange has the right to decide on the listing and trading of the company's shares. This also means that if Zhangzidao Group's stock price is lower than 1 yuan consecutively, it will trigger the delisting of par value. On November 13, Zhangzidao reported a closing price of 2.54 yuan, which is getting closer and closer to the "delisting point". Zhangzidao Group was once an excellent example of the collective economy, but it was ruined by a failed management system. The abuse of cronies as senior positions, the use of positions by cronies to undermine market rules, it is difficult to say that the major defects in this internal control are not wu Hougang's responsibility. Then, whether the regulator has made more specific and clear provisions on similar issues in Zhangzidao, and whether there are measures to order delisting or force delisting to ensure the interests of investors, these are all issues that should be reflected in the Zhangzidao incident. From riveting to chairman, to billionaire, to today's lifelong ban, Wu Hougang has performed a life of ups and downs, and also exposed the plight of China's corporate management.