Beijing Culture, which was just ST’d today (6th), unsurprisingly fell in one word, with 390,000 sell orders holding ST Beiwen (4.940,-0.26,-5.00%) (V.I.P.)’s shares dead on the down board.
But this is not the worst. Today there is news that nearly 10 million shares of Beijing Culture will be auctioned online on May 17.
Nearly 10 million shares to be auctioned
According to the information on Ali auction website, from 10:00 on May 17, 2021 to 10:00 on May 18, 2021 (except for those delayed), 9,666,900 shares of ST Beiwen held by the executor China Huali Holding Group Co., Ltd. will be auctioned, with the securities category of unlimited shares for sale.
This auction is the first auction with a starting price of RMB 53,168,300. The starting price of this online judicial auction is the average closing price of ST Beiwen shares for 20 trading days before the auction date, with a mark-up of RMB 80,000 yuan and a deposit of RMB 2.66 million.
At present, the auction is set to be reminded by 64 people, getting 1992 spectators and 0 registrants.
According to the starting price, the “receiver” will buy the shares at a minimum price of 5.5 yuan/share, but as of today’s close, the share price of ST Beiwen is only 5.2 yuan/share.
Once a quarter loss of 20 years of profit
Beijing Culture, whose full name is “Beijing Jingxi Culture and Tourism Co.
In 2017, Beijing Culture produced “War Wolf 2”, which brought it 300 million yuan; in 2018, it produced the movie “I am not the God of Medicine”, with revenue of about 255 million; in 2019, it produced the movie “Wandering Earth”, with revenue of 630 million, accounting for 81% of its total movie business; in 2020, Beijing Culture filmed “Hello, Li Huanying” for the New Year’s Eve.
All this, but it is hard to hide Beijing Culture’s declining trend.
The financial report shows that during 2017-2019, Beijing Culture’s revenue was 1.321 billion yuan, 741 million yuan and 855 million yuan, with year-on-year growth of 42.57%, -43.88% and 15.37%, respectively; net profit was 393 million yuan, 223 million yuan and -2.328 billion yuan, with year-on-year decline of 39.55%, 43.27% and 1144.16%.
It is worth mentioning that in 2019, in the first three quarters of the profit of 127 million (deducting non-net profit of 119 million), Beijing Culture suddenly fell into a huge loss at the end of the year, with a single quarter loss amounting to 2.432 billion and a full-year loss of 2.3 billion. In other words, one quarter in the fourth quarter of 2019, the loss was higher than the total profit of the company in the past 20 years.
Before the May Day holiday, on the evening of April 29, Beijing Culture issued more than 30 announcements, including “the company’s stock trading was implemented other risk warning and suspension of trading announcement”, saying that the company’s stock will be suspended for one day from April 30, 2021, and resume trading from the opening of the market on May 6, 2021.
For the reason of being ST, the announcement said that it was because the accounting firm had issued an “Internal Control Audit Report” with an adverse opinion on the effectiveness of the company’s internal control for the year 2020.
In addition, some directors still believe that they cannot guarantee the truthfulness, accuracy and completeness of the 2020 annual report and the 2021 first quarter report.
According to the announcement, Beijing Culture’s revenue in 2020 was 426 million yuan, down 50.22% year-on-year; net profit attributable to shareholders of the listed company was -767 million yuan, up 66.72% year-on-year. in the first quarter of 2021, the company’s revenue and net profit attributable to shareholders of the listed company were 15,611,200 yuan and -26,886,200 yuan, respectively.
Executive reporting, financial fraud, performance thunder ……
Also involved in Zheng Shuang’s 160 million yin-yang contract
Beijing Culture is better known through the incident of Zheng Shuang’s $160 million overpriced film remuneration.
The other party to Zheng Shuang’s shady contract is Century Partners, the producer of “Sinister”. During the production of the show, Century Partners was also a wholly owned subsidiary of Beijing Culture, whose main business is the film and television drama section.
In 2016, Beijing Culture spent $1.35 billion to purchase Century Partners. At the time of acquisition, Beijing Culture and Century Partners signed a betting agreement, Century Partners committed to a net profit of not less than 90 million yuan, 110 million yuan, 130 million yuan and 150 million yuan from 2014 to 2017, while Century Partners’ net profit during this period was 95 million, 114 million, 135 million and 150 million, which can “press the line” every year. ” to complete the performance.
By 2019, Century Partners’ operating conditions had taken a sharp turn for the worse. Beijing Culture suffered a huge loss of 2.3 billion, and the financial report attributed the main reason to the decline in the performance of its subsidiaries “Century Partners and Xinghe Culture” and decided to make a goodwill impairment provision of 1.37 billion to 1.47 billion for Century Partners. It was in 2019 that Zheng Shuang received $160 million in remuneration from the “Sinister” project.
In April 2020, Beijing Culture transferred Century Partners to Beijing Fuyi Xingda Culture Development Co., Ltd. for a low price of 48 million yuan, resulting in a huge goodwill impairment and a huge loss of 3.1 billion yuan in two years for Beijing Culture.
On the same day of the transfer, Lou Xiaoxi, chairman of Century Partners, reported Beijing Culture in name: “Beijing Culture systematically falsified its finances, used projects such as “Sinister” to help subsidiaries that had not completed their performance, and carried out benefit transfers through TV series.”
On January 4, 2021, Beijing Culture was filed for investigation. The warning letter from the Beijing Securities Regulatory Bureau showed that the “Sinister and Ghost” project involved irregular revenue recognition.
Cumulative evaporation of over 20 billion yuan
It is understood that Beijing Culture’s currently unaired film and television projects, in addition to “Sinister” which has not yet been aired, include the “God of Feng” film series directed by Urshan, “Bureau 749” directed by Lu Chuan, “Tropical Past” starring Pang Yuyan, “Dongji Island” directed by Guan Hu, and “Coming All Around” starring Liao Fan.
Among the above-mentioned works, “The God of the Rings Trilogy”, which is said to be the counterpart of “The Lord of the Rings”, has attracted much attention from the outside world.
The production cost of “The God of the Rings Trilogy” is as high as $3 billion, which is the first of its kind in Chinese cinema. According to the financial report of Beijing Culture, the investment amount of “God of the Rings Trilogy” is no more than RMB 1.3 billion, and the investment ratio is no more than 70% and no less than 20%. This may not be found in the history of Chinese movies.
In this regard, industry insiders said that according to the previous box office distribution rules, deducting special funds, taxes and fees, theatres and the propaganda share, the proportion of box office that the producer can share is about 35%. According to estimation, the total box office of “The God of Fury Trilogy” has to reach more than 10 billion in order for the producers to keep their capital, that is to say, the average box office of a single film has to be more than 3.3 billion.
Up to now, only 9 movies in the history of Chinese box office have been able to reach more than 3.3 billion yuan.
More importantly, the investment income of this work has been partially transferred recently.
On April 22, Beijing Culture issued a major contract announcement, stating that in order to diversify investment risks and ease the pressure on the company’s liquidity, the company signed an investment share transfer agreement with Tibetan Huipuhua Enterprise Management Co., Ltd. for the movie “God of the Frontier Trilogy” respectively, with 25% shares in each of the three movies, and the transfer price was 200 million. As of the disclosure date of the announcement, Beijing Culture has received RMB550 million from Tibet Huipuhua for the transfer.
Obviously, it is difficult for Beijing Culture to make back its investment in the “God of the Fathers Trilogy”. Zheng Shuang’s appearance in “Sinister” has also been completely unlikely to be released. Beijing Culture, which lost 700 million last year, continued to expand its losses in the first quarter of this year.
As of the latest data, the market value of Beijing Culture is only 3.7 billion. Compared to the beginning of 2016, the cumulative evaporation is over 20 billion yuan. In addition, as of the end of March 31, Beijing Culture’s stockholders were still as high as 71,000 households.
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