Red Dragonfly Suspected Of Inflated Profits In Jail

Zhejiang Red Dragonfly footwear industry The Limited by Share Ltd (hereinafter referred to as "Red Dragonfly") has disclosed the prospectus prospectus. The total investment is estimated to be 866 million 912 thousand and 500 yuan, including 760 million 87 thousand and 400 yuan in construction investment and 106 million 825 thousand and 100 yuan in mobile capital. On the basis of the existing marketing channel network, the company plans to further develop the market potential of the two or three line market by opening a direct run independent store, while expanding its influence in the first-line market and gaining market share.

However, when reading the prospectus, reporters found that at present, the red dragonfly is not only in the contracting state of the marketing network, but also in the reduction of the output of its main products. Meanwhile, net profit has also experienced a negative growth in recent years, and even many key financial indicators are lower than the average level of the same industry.

　　 Adverse market expansion, investment projects are worrying

In the prospectus, red dragonfly introduced: as of June 30, 2014, December 31, 2013, December 31, 2012 and December 31, 2011, the franchisees of the issuers were 2551, 2765, 2743 and 2468 respectively. In 2010 ~2012, the franchisee developed more franchisees. In recent years, the degree of prosperity of the retail industry has declined, and the profit margins of franchisees have been squeezed to a certain extent, and the number of franchisees has declined.

In addition to the above introduction, the reporter found that with the decline in the number of franchisees, the number of direct Dragonfly stores was also significantly reduced, from 699 at the end of 2011 to 530 at the end of 6 in 2014, a total reduction of 169. The decline of franchisees and direct stores in recent years shows the contraction of the company's marketing network.

Corresponding to the shrinking of marketing network, its production is also not optimistic. According to the company prospectus data, self production capacity and self-produced output are decreasing year by year, and the utilization rate of capacity has not been saturated. At the same time, red dragonfly inventory and accounts receivable and other aspects can also show that red dragonfly products are not so popular. In recent years, enterprises have kept up to more than 500 million yuan inventory and increasing number of accounts receivable.

Under normal circumstances, if the enterprise plans to expand, it should increase the corresponding production capacity, optimize the personnel structure and improve the management efficiency. But it is puzzling that the Red Dragonfly reduces the number of production workers from 4013 in 2011 to 2497 in June 2014, while the number of non production workers has increased from 2886 in 2011 to 3739. Such a restructuring of personnel structure, red dragonfly is not worried about the lack of power production enterprises, overstaffing it?

With the contraction of the Red Dragonfly marketing network and the reduction of production personnel, the company's net profit also showed signs of decline. Its net profit in 2013 decreased by 36 million yuan compared with 2012, and many other financial indicators of the company were lower than the average level of the same industry. If the Red Dragonfly chose BELLE international, Daphne international, Saturday, 1000 international, AOKANG international 5 industry companies to calculate the average value of the industry comparison, the reporter found that the Red Dragonfly's profitability and solvency are lower than the same industry average.

At the same time, reporters also found that as of June 30, 2014, the Red Dragonfly Monetary Fund amounted to 500 million yuan, and only the amount of bank deposits as high as 430 million yuan. In the past few years, why did the Red Dragonfly do not want to take out its own funds to expand the already shrinking retail outlets? Instead, it has to go through the listing financing to achieve the purpose of expanding the retail outlets. Does it mean that the profit and loss problem is not taken into account? In recent years, the retail industry in China is undergoing more painful transformation and transformation. The listed companies in the retail industry have reduced the number of physical stores. Especially in 2013, China has experienced a huge wave of sports brands, and the related companies in the retail industry have further accelerated the pace of closing stores. Whether the seven wolves, the wedding birds or the Daphne, the scale of the outlets and franchisees have all been shrinking in different scales. Today, the red dragonfly has chosen to expand its business against the trend of the industry, so we can not help worrying about its development.

　　 Financial accounting Doubt about the relationship

According to the Red Dragonfly financial statements, there has been a large amount of money in its accounts, most of which are bank deposits. During the reporting period, it reaches hundreds of millions of dollars every year, and it is also increasing. On the other hand, its short-term borrowing amount and long-term borrowing amount remain high. The Red Dragonfly pays a large amount of interest on loans every year, resulting in its high financial cost. But the red dragonfly is unwilling to take out the money to repay its bank loan. This behavior is really hard to understand.

What is equally puzzling is the financial relationship between the Red Dragonfly balance sheet and the cash flow statement. We know that the cash received from the cash flow statement and the cash paid for the repayment of the loan have the following relationship: "cash received for obtaining loans - the amount of cash paid for repayment of loans = loan increase". According to the cash flow statement in the financial statements of the red dragonfly, it is not difficult to calculate the amount of loan increase from 2011 to June 2014.

In the balance sheet, because the Red Dragonfly did not deal with bonds in the reporting period, the borrowing situation has the following relationship: "loan increment = short-term loan increment + long-term loan increment". As the Red Dragonfly report does not disclose its short-term borrowing and long-term borrowing in the early 2011, we will take the final data in 2011 as a forecast for the beginning of 2012, and we can conclude that the increase in the amount of short-term loans and the increase in long-term borrowings in 2012 are, in this case, we can deduce the amount of increase in short-term loans and increase in long-term borrowings in 2013 and June 2014, and then deduce the amount of loan increase from the red dragonfly to the 2013.

Under normal circumstances, the amount of borrowing increased by the above two methods should be equal. However, to the reporter's surprise, after the detailed calculation, only the June 2014 results are in line with expectations, and the data in 2012 and 2013 are quite different. Obviously, there is something wrong with the relationship between the financial dragonfly and the red dragonfly.

　　 The main product sales situation is vague. Inflated profit

According to the relevant requirements of the securities and Futures Commission issued by the securities and Futures Commission on the content and format standard of the company's information disclosure No. first - prospectus, enterprises need to list the changes in the capacity, output, sales volume, sales revenue, main consumer groups and sales prices of the main products (or services) during the reporting period. However, in the prospectus, the red dragonfly has not disclosed the leather products, children's articles, clothing's capacity, output and sales volume in the prospectus. Of course, these products account for a relatively low proportion of their main leather shoes, which can not be disclosed. However, it is strange that the important information of the red dragonfly on its main products, such as the sales volume, production and sale rate, and selling price, has not been disclosed, which is obviously not consistent with the relevant provisions of the letter.

Because the Red Dragonfly information disclosure deliberately uses different statistical caliber to disclose, the disclosure of the main product's output is based on leather shoes as the caliber, which discloses the output and the output of leather shoes, while the men's shoes and women's shoes are used as the statistical caliber in the analysis of gross profit rate. For this purpose, the journalists convert the caliber of leather shoes into the calculation of the caliber of leather shoes, and the journalists calculate the wholesale price of leather shoes according to the wholesale price of men's shoes and women's shoes.

According to the prospectus, the sales mode of red dragonfly is direct sales and franchising, and the direct sale of independent stores directly faces consumers. The base price of goods transaction price is retail guidance price, while the single store delivery price of franchised stores is wholesale price. Therefore, the average selling price of leather shoes is calculated through the proportion of franchisee sales and other retail selling prices as sales price, and the sales of leather shoes can be calculated from the sales income of leather shoes during the reporting period. As the total output is less than the sales volume, we can get the stock of the new stock. Therefore, according to the total output of leather shoes produced by the red dragonfly and the sales of leather shoes and the average cost price calculated by the journalists, we can calculate the new stock and the newly added stock amount of the Red Dragonfly's leather shoes in recent years.