Xiangxieli Media's net profit loss in 2015 was 374 million yuan. Guangdong Media's mergers and acquisitions were "affected"

The disclosure of the annual report is gradually coming to an end, and some mergers and acquisitions that were once "glorious" back then have to hand in answers to test their "quality."

Today, Guangdong Media issued an announcement saying that the merger completed by the company in July 2014 encountered major variables in 2015. The target company not only failed to achieve its net profit commitment last year, but also suffered significant losses, dragging down the performance of listed companies. It is worth noting that although according to the original agreement, 20 counterparties including Ye Mei, the original shareholders of the target company, were required to make corresponding compensation with the shares and cash obtained during the reorganization, some of them had pledged their shares., and also caused a judicial freeze due to debt guarantee disputes. Therefore, there is still uncertainty whether the relevant compensation can be fulfilled.

Performance commitment completion rate-544.78%

. Guangdong Media announced today that its acquisition of Champs Elysees Media in 2014 achieved a net profit of-374 million yuan in 2015, far lower than the 68.7 million yuan promised in the previous reorganization (not yet included in the capital increase) The profit commitment is 3.346 million yuan), and the actual completion rate is only-544.78%.

Regarding the reasons for failing to fulfill its profit commitment, Guangdong Media stated: Due to the suspected contract fraud of Ye Mei and others, Champagne Media encountered a lot of uncertainties. For this reason, the company reversed 93.0071 million yuan of the target company's 2015 revenue; At the same time, based on the principle of prudence, a bad debt reserve of 217.9425 million yuan was made for Champagne Media's accounts receivable.

In addition, Guangdong Media also stated that Champs Elysees Media's advertising collection was slow and its funds continued to be tight, resulting in a large number of overdue payments. Suppliers claimed their rights and interests through means such as suspension of broadcasts, which seriously affected the daily operations of the target company and the expansion of new businesses.

Looking back on the previous restructuring plan, Guangdong Media and its wholly-owned subsidiary Guangzhou Daily New Media acquired 100% equity of Champslie Media at a price of 450 million yuan in cash and issued shares.

Among them, Guangdong Media and Guangzhou Daily New Media paid a total of 87.4955 million yuan in cash to purchase 19.44% of the shares of Champs Elysees Media, and issued 33.1964 million shares to Ye Mei and other 17 counterparties at a price of 10.92 yuan per share to purchase another 80.56% of the shares.

According to the agreement at that time, Ye Mei and other 20 counterparties promised that the net profit after deduction of non-profit in 2014, 2015 and 2016 should be no less than 56.83 million yuan, 68.7 million yuan and 81.56 million yuan respectively.

However, judging from the current situation, it is probably difficult to realize the above commitments.

As a bet, there is also uncertainty as to whether Ye Mei and other counterparties can fully cash out the compensation to Guangdong Media. According to the announcement, Ye Mei and other 20 counterparties need to compensate with all the Guangdong Media shares and cash obtained during the material asset reorganization, totaling approximately 450 million yuan after conversion. However, some counterparties pledged their shares in Guangdong Media, and since then, due to their debt guarantee disputes and other reasons, they have incurred judicial freezes and performance compensation may be uncertain.

The "leapfrog" performance commitment buried the thunder and

retroactive restructuring plan. It is not difficult to find that the original shareholders of Champs-Eles Media are quite optimistic about the development prospects of the target company, and the performance commitments made far exceed their previous performance.

Compared with its performance commitments, Champs Elysees Media achieved operating income of 174 million yuan and net profit of 36.47 million yuan in 2011; in 2012, operating income was 240 million yuan and net profit of 36.95 million yuan. Compared with this, the target company's committed performance in 2014 increased by approximately 20 million yuan, and its committed performance in 2015 doubled compared with a few years ago.

In fact, the reporter found from Guangdong Media's 2014 annual report that Champs Elysees Media's net profit after deducting non-profit that year was 50.7502 million yuan, which only fulfilled 89.3% of its performance commitment.

It is worth noting that the outbreak of Champs Elysees Media's problems today seems to have a warning. In March this year, Guangdong Media once said that it had received a "Notice of File Registration" from the Guangzhou City Public Security Bureau and was told that Ye Mei and others had been filed for suspected contract fraud, and Ye Mei is the general manager of Champsélles Media.

The "pit" dug by Champs Elysees also directly led to a significant decline in Guangdong Media's own performance. Previously, the company expected a net profit of 7.9847 million yuan for 2015. After the contract fraud incident, Guangdong Media revised its performance report to-274 million yuan. When the annual report was released, the actual net profit was-445 million yuan.

Industry veterans said that due to the continued popularity of digital marketing concepts in the past two years, both companies already in the industry and those cross-border entrants are hoping to "heat up" their digital marketing assets and sell them to listed companies. Mergers and acquisitions are one of the "shortcuts". But at the same time, because the guidelines for this emerging industry are not yet clear, chaos occurs frequently. If listed companies blindly follow suit and intervene, problems may also follow.

Mergers

and acquisitions have always been favored by the capital market, but with the arrival of the performance commitment inspection period,"face-changing" cases are inevitably increasing.

For example, Yinxing Energy spent 1.28 billion yuan to acquire six wind power assets in early 2014. Its previous performance commitments were net profits of 46.15 million yuan, 54.6 million yuan and 63.58 million yuan in 2014, 2015 and 2016 respectively. As of March this year, the company announced that the net profit after deduction of non-profit from the above-mentioned underlying assets in 2015 was 23.73 million yuan, which only reached 43.46% of the promised performance.

Similarly, Yawei also disclosed in March that the net profit of Chuangkeyuan, a subsidiary acquired last year, in 2015, was 10.6012 million yuan, which was quite different from the performance commitment of 15 million yuan and failed to meet the standards. The company said that this was mainly due to the slowdown in domestic economic growth in 2015, and the market demand in the laser cutting industry failed to reach the expected level of Chuangkeyuan management; at the same time, new products were not launched in time, and competition for old products intensified, resulting in a continuous decline in gross profit., it also adversely affected Chuangkeyuan's profitability.

Similarly, Yishida purchased a 100% stake in Golmud Shenguang, a subsidiary of Shenguang New Energy, for 238 million yuan in 2014. The reporter found that just as the acquisition was advancing, the net profit of the target company was still at a loss, but Shenguang New Energy still promised that the net profit of the target company in 2015 and 2016 would not be less than 28.25 million yuan and 30.8 million yuan respectively. Since then, due to failure to meet its promise, Yishida received 35 million yuan in compensation from Shenguang New Energy in 2015.

In this regard, analysts said, The acquisition target performance fails to meet the standard generally there are two situations: First, the acquisition target belongs to the emerging industry, The basis for consideration is not clear, So can only take a step to see; Second, The transaction related parties originally with high performance commitment to catch people's attention, Thus buried "Mine."

Editor: Tsai