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- Chief Business Intelligence
- Chief Business Intelligence
Introduction: "Durian King" caused trouble again, executives retreated, and financial re-examination.
Hongjiu Fruit, a durian distributor with a large proportion of the domestic market, has been in a new round of difficulties since the price of durian plummeted.
The rupture of the capital chain was actually foreshadowed.
Industry secret: paper wealth "bleeds"
The "Durian King" is really a wave of unsettled, wave after wave.
In addition to Dong Jiaxun, Xia Bei, and Liu Anzhou, the three non-executive chairmen resigned collectively. Hong Jiu Fruit, once known as the "No. 1 Fruit Stock" and a household name by shareholders, has reluctantly begun to continue loan financing and equity pledge.
According to Flush Finance, Deng Hongjiu (chairman and executive director of Chongqing Hongjiu Fruit) has pledged 3.96 million domestic shares of the company in June this year, accounting for about 1.05% of the total.
Zheshang Bank also provided a pledge of 29.48 million yuan of loan financing to Hongjiu Fruit, and as of June 20, the total number of shares pledged by Deng Hongjiu was about 11.26%.
Source: Straight flush
Source: List of announcements of Hongjiu Fruit Company
It is not difficult to see that Hongjiu Fruit's financial predicament has become an open secret.
Although it is not a bankruptcy, after all, "there are still three nails in the broken ship", "standing on the edge of the cliff" can be said to be the truest portrayal of Hongjiu Fruit.
In the glory days, Hongjiu fruits were mainly imported fruits, and in addition to the well-known durian products, there were also six core imported items, such as mangosteen, longan, dragon fruit from Vietnam, red grapes from Peru and cherries from Chile.
Source: Hongjiu Fruit official website
According to its official website, in order to realize the "end-to-end" model of their new industrial chain, not only has an overseas team carry out direct source procurement, but also equipped with 16 processing plants and 60 sales sorting warehouses, covering more than 300 cities.
Source: Hongjiu Fruit official website
It is no exaggeration to say that a slight "break" will cause a huge gap or even collapse.
Therefore, there is an open secret in the industry, that is, the larger the scale of Hongjiu Fruit, the greater the financial pressure.
To be honest, the price of fruits is similar to that of ordinary grains and oils, they all "rely on the sky to eat" and the price fluctuates greatly, so when "durian falls below 10 yuan a catty" rushes to the hot search, Hongjiu fruit is not far from collapse.
Because of the transparency of the Internet, many people "shop around", so that the profits of physical fruit stores are compressed very low, and the continuous increase in rent, water, electricity and labor is naturally a large expense.
According to the "City News" interview with Hongjiu Fruits, the mode of purchasing Hongjiu Fruits from the place of origin and supplying them to supermarkets before payment has made the gap of Hongjiu Fruits bigger and bigger.
There is a two-level scenario of objective revenue on the books, but in fact continuous net outflow of operating cash flow.
Judging from the financial reports of Hongjiu Fruit in 2022 and the first half of 2023, the net receivables are still as high as 7.667 billion yuan and 8.673 billion yuan, which seems to confirm this statement.
Source: Hongjiu Fruit's corporate financial report
Therefore, when the capital chain of the supply side, sales side and other ports of Hongjiu Fruit collapses, coupled with these huge consumptions, it is really "collapse is imminent", "the house leak happened to rain overnight".
In fact, if you look at it this way, it is not difficult to understand why Hongjiu Fruit, which once had a market value of more than HK$67 billion after being listed on the Hong Kong Stock Exchange in 2022, will borrow as much as 2.7 billion yuan from banks from January to June 2023, and the debt ratio will increase by about 49% year-on-year.
Source: China operating financial report
The stock price and market capitalization also continued to decline, and the stock price fell to HK$1.74 at the time of the suspension, with a total market capitalization of 2.795 billion, and the market value plummeted by nearly 50 billion.
Source: Q9 Zhitou
The most tricky thing is that at a time when Hongjiu Fruit should submit a new round of reports to the Hong Kong Stock Exchange, the sudden resignation of KPMG has made many netizens speculate whether there is a suspicion of financial fraud.
Because according to KPMG's response, when they were accounting, they found that in January this year, Hongjiu Fruit paid 1.52 billion yuan in advance payment for goods to suppliers, but only 405 million yuan was received in return that month.
Obviously, this "default" has directly affected the financial health of Hongjiu Fruit.
Source: Hong Kong media reports
Not only that, but even the internal investigation of Hongjiu Fruit by the newly joined auditors and risk management companies is expected to be announced in July this year at the earliest.
Therefore, it is not difficult for the outside world to speculate about the financial predicament of Hongjiu Fruit, whether it will be due to the large difference between the advance payment and the return amount, which "scared away" the financial company.
On the one hand, it is well known that the fruit track is a relatively "extreme" business, and Hongjiu Fruit is "playing the supply chain".
Therefore, if you want to control costs, you must improve the management efficiency of the supply chain, and improving efficiency is a cost in itself, which is very embarrassing.
On the other hand, because of the fragile nature of the fruit, it will be extremely easy to lose on the way from the production end to the sales end. Hongjiu Fruits, which focuses on the "high-end fruit" market, will naturally increase transportation costs in order to maintain high quality.
Therefore, in order to maintain the balance of income, these losses can only be "premiumed" to the selling price of the fruit.
When the market is good, these are not problems, but when the market is not good, and there are cheap and delicious imported fruits everywhere, the advantage of Hongjiu fruit becomes a disadvantage.
The sudden price drop of durian can only be said to be the "last straw", not the whole thing.
According to Hongjiu Fruit's financial report, Hongjiu Fruit's revenue in the first half of 2023 will be about 8.54 billion yuan, a year-on-year increase of 19.4%, but in terms of net profit, it will fall by 6.51% year-on-year, resulting in a loss of 803 million yuan.
These figures all reveal the embarrassing financial situation of Hong Jiu Fruit.
Source: Baidu Stock Connect data
Although the recent layoffs and business adjustment turmoil are necessary means for normal operation, the performance is not good, and it is understandable that Mingzhe will protect himself.
However, there has been a subtle change in the voice of consumers towards Hongjiu Fruit.
demolished the east wall to make up the west wall, and was tragically implicated in the "non-suction case".
In addition to Deng Hongjiu's pledged equity cash-out, as early as last year, frequent placements of new shares began.
Speaking of Deng Hongjiu (founder), who was born in 1970, it is inseparable from a popular entrepreneurial story. From selling longevity red oranges to "durian king", and then becoming the "first brother" among the distributors of imported Southeast Asian fruits in China, Deng Hongjiu has walked for decades.
The source direct procurement mode of Hongjiu Fruit has realized the "end-to-end" model of direct procurement from the fruit producing area by cutting off the intermediate links, and has ensured the quality of Hongjiu Fruit for a long time.
As the digital supply chain management system of Hongjiu Fruit, "Hongjiu Xingqiao" not only simplifies the data collection of revenue loss.
In addition, we can develop logistics solutions according to customer needs, and realize the whole process of cold chain temperature control and tracking system for overseas production areas, so as to achieve optimal scale.
Source: Hongjiu Fruit official website
However, such a digital management advantage did not "save" Hongjiu Fruit.
In April last year, a total of 14.96 million shares were placed at HK$23.61 per share, raising a net amount of HK$345 million.
At the beginning of this year, Hongjiu Fruit issued an announcement, disclosing that the company had placed each H share at HK$4.35, and if the placement agreement of 189 million new H shares was followed, the maximum contract would be HK$801 million.
Then, in April this year, it once again issued no more than 30,487,800 new shares to domestic investors at 16.4 yuan per share, raising a total of 500 million yuan.
It is not difficult to see that under the "end-to-end" model, the "strings" of Hongjiu Fruit's capital chain have been tightened.
But the next self-help of Hong Jiu Fruit was unsatisfactory, and it can even be said to be "worse".
For example, according to the financial report, as of the first half of 2023, the total receivables of Hongjiu Fruit were about 10.151 billion yuan, an increase of 1.155 billion yuan from the end of 2022.
No wonder it was ridiculed by netizens: Debt collection while owing debts, durian king is so miserable!
This is likely to be due to Hongjiu Fruit's transformation to C-end online business to expand its business territory, attracting consumers to e-commerce platforms and live broadcasts, but increasing the financial burden due to large-scale purchases.
The most outrageous transformation was the dream linkage of "Meet the Little Yellow Duck" and "Meet the Fruit Journey" in August last year, because when the strategic cooperation agreement was signed.
Executive Director Yang Junwen's vision of completing the layout of 4,500 "Meet Fruit Journey" stores across the country by 2024 turned into a case of suspected illegal absorption of public deposits in February this year.
Although Hongjiu Fruit has issued a document clarifying that it only provides fresh fruits as a supplier, and the two parties have stopped cooperating since the end of 2023.
However, Hongjiu Fruit's reputation and market image have been damaged, and durian alone can no longer support a huge business territory.
The "Fruit Assassin" lost people's hearts, and the "bottoms" were stripped of their slower runs
In addition to the financial situation of Hongjiu Fruit, consumers' evaluation of Hongjiu Fruit's king fried product, durian, is still in a polarized situation.
Some netizens said, "Hong Jiu Fruit's palm durian, although it is only the size of a palm, has a high meat yield, but every room is full." ”
There are also netizens who shared the special durian of Hongjiu Fruit purchased through other offline channels, "Although the price is cheap, the quality is still okay." ”
But some netizens said: "Hong Jiu's quality is extremely poor, I bought 2, one and a half raw, one wet bag, 5 catties of wet buns out a little more than 1 catty of meat", "It's not as good as the durian in the supermarket at the door, the Hong Jiu I bought is not delicious."
Hongjiu Fruit, known as the "King of Durian", controls the quality of its own durians so unbalanced, it is no wonder that it will lose the trust of consumers, resulting in a waterloo in sales.
In addition to Hongjiu Fruits, there are also "South Baiguo, North Xianfeng" in the fresh fruit market, and these two brands can be said to have formed a three-legged situation with Hongjiu Fruit.
When it comes to Baiguoyuan, it is difficult not to be reminiscent of the label of "fruit assassin", and "not pit the poor" has also been ridiculed by netizens as an advantage.
What's even more outrageous is that "a watermelon costs 99, and durians are two or three hundred", which is really difficult to understand.
Although it is said that you get what you pay for, and those who pick hundreds of orchards and spend hundreds of fruits to buy are of quality, but some netizens said that the plums they bought, 42, only five or six in a box, turned out to be bad.
Some netizens said, "This is bad on the inside, and the Feng Tang Li I bought was 20 yuan for 5, and one of them was bad on the outside."
What's even more outrageous is that "I just bought it back, this melon is running water, and the quality control is getting worse and worse".
Although the after-sales service of Baiguoyuan is still leveraged, and the bad fruit can be returned, it is expensive and unpalatable, but it has become the most evaluated by everyone in recent years.
In addition to these head brands turning into "assassins", there are also some fruit shops under the banner of high-end fruits, which are also "harvested".
9.8 yuan for a plateau red apple, involving an orange for 11.5 yuan and 2 pears for 24 yuan.
In Tianhe City, Beijing Road, 78 yuan a piece of sky-high fruit fishing, netizens said that they could buy such a large portion for 28 yuan.
There are also some fruits that sell "sky-high" prices under the banner of imported fruits.
On the other hand, today's consumption concept is to save if you can save, and the main thing is not to spend a penny, and the fruit store is afraid of being "stabbed", so it turns to online shopping or supermarkets, markets and other places with more clearly marked prices.
In the past, supermarkets had special prices, and they were crowded with old people, but now they are all young people.
Write at the end
Hongjiu Fruit has grown from a "mom-and-pop shop" to a "fruit king", from bulk distribution to direct procurement at the source, and has established its own brands including Thai Delicious, Yuelaimei, Hongjiu, and Xiaohao, far exceeding the industry average.
But today's embarrassing situation can be said to be "success is also capital, defeat is also capital", if you can't rush out of a new track, I'm afraid that the situation will be even more embarrassing.
What do you think? Welcome to leave a message in the comment area to share.
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