MSG’s first stock has succeeded in protecting the shell. What is the future of Lotus Health?

MSG’s first stock has succeeded in protecting the shell. What is the future of Lotus Health?
17 Jul
2020

“MSG’s first stock” has succeeded in protecting the shell. What is the future of Lotus Health?
* ST Lotus ‘stock was suspended on April 8 after growing for 4 consecutive trading days.After the stock resumes trading tomorrow, the stock abbreviation of the listed company will be changed from “* ST Lotus” to “Lotus Health”, which means that Lotus Health’s “shell” is successful.Now, the once insolvent Lotus Health has completed the reorganization, and decided to consolidate the existing business of MSG at the same time, make every effort to improve the quality of chicken essence and increase market share, and focus on the direction of the family kitchen and hotel catering terminal,Development of new products such as amino acid seasoning.Despite turning losses into profits last year, the deduction of non-net profit is still negative. Since its establishment, Lotus Health has been committed to the research, development, production and sales of edible condiments.The green product structure of the combination of protein series and wheat flour series.On April 7, 2020, the Shanghai Stock Exchange agreed to implement a delisting risk warning for Lotus Health stocks, which means that Lotus Health’s “shell” is successful.This way, Lotus health is not easy.Lotus Health was listed on the Shanghai Stock Exchange in 1998 and is known as the “first stock of MSG”.Since its listing more than 20 years ago, Lotus Health has changed ownership several times.Since the audited net profit of two consecutive fiscal years in 2017 and 2018 is negative, and the audited net assets at the end of 2018 are negative, according to relevant regulations, Lotus Health’s stock was implemented on April 29, 2019Delisting risk warning.So, how does Lotus Health achieve profitability in 2019?According to the financial report, although Lotus Health’s net profit attributable to shareholders of listed companies in 2019 is close to 70 million yuan, its net profit attributable to shareholders of listed companies replacing non-recurring gains and losses is still negative, and its operating income in 2019 is alsoThe previous level.This shows that the main business of Lotus Health has not played a role in driving performance growth in 2019.Careful observation of the financial statements shows that Lotus Health can turn losses into profits in 2019, thanks to non-recurring gains and losses, including the restructuring of Lotus Health, the disposal of the atomic company Henan Xiangcheng Canon Thermal Power Co., Ltd. (referred to as “Canon Thermal Power””)) Equity income and non-current asset disposal income, etc.In 2019, the net cash flow generated by Lotus Health Investment activities was 43705.700,000 yuan, the net cash flow from investment activities in the same period last year was 3931.420,000 yuan, mainly due to the increase in assets disposal of listed companies in 2019; in 2019, the net cash flow generated by Lotus Health financing activities was 67498.720,000 yuan, the net cash flow from financing activities in the same period last year was 814.780,000 yuan, mainly due to the increase in investment funds received by listed companies in 2019.Sauna, Yewang noticed that in 2019, Lotus Health transferred 100% of its wholly-owned subsidiary Canon Thermal Power to Xiangcheng State-owned Assets Holding Management Group Co., Ltd. (referred to as “Xiancheng State Control”) at a price of 1 yuan.According to public information, Xiangcheng State Control is a comprehensive investment and financing platform built by Xiangcheng, with 100% shares held by Xiangcheng People’s Government.It is reported that Canon thermal power equipment is outdated, working capital is tight, unable to upgrade the technology, high operating costs, usually has been in a state of replacement, is currently insolvent, and is in a state of suspension.When transferring the Canon thermal power distribution, Lotus Health mentioned: “This transaction is expected to have a positive impact on the company’s 2019 performance and increase the consolidated statement of income 21255.440,000 yuan, increasing the parent company’s income -3205.400,000 yuan (the income confirmation needs to be based on the results of the accountant ‘s annual audit).”After the bankruptcy and reorganization, Lotus Health has changed its ownership. Li Houwen, due to the heavy burden of historical debt and surplus personnel, wasted funds, and it is difficult to pay debts, which has caused Lotus Health to run into trouble.In 2019, Lotus Health was once insolvent, and there was continuous operation to fill the situation, restructuring is imminent.On October 15, 2019, Lotus Health received (2019) Yu 16 Po Shen No. 7 “Civil Ruling” and (2019) Yu 16 Broker delivered by Zhoukou Intermediate People’s Court (“Zhoukou Intermediate People’s Court”) of Henan ProvinceThe Decision No. 7 ruled that the creditor Guohou Asset Management Co., Ltd. (abbreviated as “Guhou Assets”) applied for the reorganization of Lotus Health.The “Decision” designates Beijing Jindu Law Firm as the company manager.On November 28, 2019, Lotus Health, the company’s managers signed the reorganization of Lotus Health Industry Group Co., Ltd. with Wuhu Liantai Investment Management Center (Limited Partnership) (“Liantai Investment”) and Xiangcheng State ControlThe investment framework agreement of the case confirmed that Liantai Investment and Xiangcheng State Control were the main reorganization investors to participate in the judicial reorganization of Lotus Health. Liantai Investment and its designated third party, conditional transfer of Lianhe Health CapitalProvident Fund turned into stocks and provided funds to Lotus Health.On March 4, 2020, Lotus Health received the “Civil Ruling” from Zhoukou Intermediate People’s Court (2019) No. 7 Yu 16, and Zhoukou Intermediate People’s Court ruled that the Lotus Health Reorganization plan was completed and the Lotus Health Reorganization process was terminated.During the reorganization process, the actual controller of Lotus Health also changed.Due to the implementation of the investor equity adjustment plan of the “Lotus Health Industry Group Co., Ltd. Reorganization Plan”, Lotus Health has changed its equity.This equity change will change the controlling shareholder of Lotus Health from Lianxing Enterprise Service Management Center Partnership (Limited Partnership) in Lianshan County to Liantai Investment, and Li Houwen will become the actual controller of Lotus Health.Sauna, Yewang noticed that Li Houwen was briefly the actual controller of another listed company, Zhongtian Energy.Li Houwen, born on September 30, 1978, founded Anhui Boya Investment Co., Ltd. in 2003 and served as chairman; in 2006, he founded Anhui Wenfeng Group as chairman; in 2013, he founded Shenzhen Qianhai Dahua Asset Management Co., Ltd.The company served as chairman; in 2014, he initiated the establishment of Anhui Guohou Financial Asset Management Co., Ltd. as chairman.In addition, Li Houwen is also the executive chairman of the Anhui Provincial Enterprise (Entrepreneur) Federation, the vice chairman of the Anhui Chamber of Commerce and Industry, and the executive chairman of the Peking University Anhui Alumni Association and other social positions.Guohou Assets was established with the approval of the Anhui Provincial People’s Government and approved by the China Banking Regulatory Commission and announced by the Ministry of Finance and filed with the Ministry of Finance.As of the end of December 2019, Guohou Assets has acquired more than 100 billion U.S. dollars in non-performing assets, involving dozens of banks and nearly 1,000 companies such as workers, peasants, and construction companies.More than 100 funds and other funds, with a scale of more than 120 billion yuan.Li Houwen is the chairman of Guohou Assets.This also means that Anhui Guohou Department has taken over a leading enterprise in Henan.Geometry of Lotus health?According to the analysis, it will take at least a year and a half to restore the vitality of the main business in 2019. While actively cooperating with the judicial restructuring, Lotus Health has also carried out the work of retreating from the city and entering the park.The production line and the annual production line of 7 seasoning spice amino acids will undertake and expand the company’s existing seasoning and other food production and sales business.It is reported that Lotus Health has completed the design of the new plant and officially started construction in November 2019. “After the project is completed, it will reach the production scale of 7 flavor essences, 3 compound compound seasonings, and 3 export chicken essences, which will greatly increase the company’s scale.Profitability is a good foundation for the company’s main business to continue to develop healthily.”At present, there are less than 10 companies in production in the domestic flavor industry, and the MSG industry has formed a highly concentrated industrial layout.For a long time, Lotus health sales channels have covered the whole country, and the sales of MSG have always dispersed the position of the domestic MSG terminal retail market for a long time.Lotus Health stated that in 2020, the company will make use of its brand advantages and market channel advantages. According to the requirements of “health, nutrition, and deliciousness”, while consolidating the existing business of MSG, it will strive to improve the quality of chicken essence and increase market share, focusing on the family.In the direction of kitchen and hotel catering terminals, new products such as amino acid seasoning, mushroom seasoning, convenient set seasoning, special agricultural products, bread crumbs and other western food condiments are developed.”Lotus Health should now work hard to restore its main business, and after making the main business bigger and stronger, explore the diversified development path.”China Food Industry Analyst Zhu Danpeng predicts,” Lotus Health’s main business will take at least a year and a half to two years to regain its vitality. It is difficult for Lotus Health to do other layouts before the main business is restored.”Sauna, Night Net Yan Xia editor Yue Caizhou Xu Chao proofread Wang Xin