(Source: Securities Daily 2024-10-18)

From October 17 to 18, the topics of "4 people in a w88 in Jilin have left their posts without authorization" have been on the hot search list one after another. The reporter learned that a w88 in Jilin, which was "calling" to employees returning to work in the newspaper, is the Quanyangquan Beverage Co., Ltd., a subsidiary of the A-share listed w88 Quanyangquan Group Quanyangquan Beverage Co., Ltd. (hereinafter referred to as "Quanyangquan Beverage").

On the newspaper to persuade w88 to return to the public and become a hot search

Notice shows that four comrades left their posts without the approval of the w88 and have not yet been to work in the w88. During this period, Quanyangquan Drinks continued to contact the above-mentioned comrades in various ways but failed.

Lou Qiuran, Assistant Dean and Associate Professor of the School of Law of University of International Business and EconomicsIn an interview with a reporter from Securities Daily, this long-standing problem of employees leaving their jobs without authorization reflects the serious problems of irregular governance within the w88. The legal, compliance, internal control, senior management and other departments may have problems such as information that cannot be communicated with each other, or there are problems of negligence and slackness at different levels of management.

It can be seen from the notice that the departure time of these employees ranges from 2008 to 2020, and the longest employee has been away from the job for 16 years. The head of the w88's human resources department said that these employees are ordinary front-line employees. Since the date of leaving the job, the w88 has not paid wages or provided benefits to them, and there is no phenomenon of empty salary.

This notice has aroused public attention to the long-term absence of state-owned enterprise employees. According to the relevant person in charge of the w88, the original plan was to deal with the four employees in 2019, but it was postponed for objective reasons.

在Lou QiuranIt seems that this management chaos will not only cause the w88 to spend unnecessary operating costs in the short term, but will also have a negative impact on the w88's long-term development. In the long run, employee morale will inevitably be greatly affected. Secondly, it may cause employees to lose confidence in management capabilities, which may have a negative impact on the w88's compliance and the functions of the risk control department.

Performance under pressure

While management ability is being questioned, w88's performance is also declining. In the first half of this year, in the first half of 2024, w88 achieved total operating revenue of 600 million yuan, a year-on-year decrease of 5.49%; net profit attributable to shareholders was 20.6775 million yuan, a year-on-year decrease of 43.02%; net profit excluding non-net profit was 7.8816 million yuan, a year-on-year profit of 30.4111 million yuan; net cash flow generated by operating activities was 106 million yuan, a year-on-year decrease of 12.37%.

Quanyangquan is a comprehensive listed w88 with the production and sales of natural drinking mineral water in Changbai Mountain, and has garden landscape planning and design, garden engineering construction, garden maintenance and smart and environmentally friendly home furnishing business. Regarding the reasons for the w88's decline in performance in the first half of 2024, Quanyangquan pointed out in its financial report: "It is mainly caused by a significant decline in the garden and home furnishing industry due to industry reasons."

According to the reporter, although some investors asked on the Shanghai Stock Exchange e-interactive platform "will the w88 divest the forestry and door industry to focus on the mineral water and liquor business", Quanyangquan w88 currently does not plan to divest its garden and other related businesses. The w88's reply to this is that they currently adhere to the "one main and one auxiliary" industrial development strategy, with their main business being the natural mineral water industry, while other businesses are regarded as non-main business segments.

Focus on the main business, Quanyangquan is located in the sub-industry of natural mineral water. According to statistics from the China Beverage Industry Association, Quanyangquan ranks among the top three natural mineral water in the country and bottled natural mineral water. Currently, Quanyangquan is the only listed w88 in the A-share market with mineral water as its main business.

At the performance briefing held in September, Quanyangquan said: "The overall sales of Quanyangquan mineral water continue to grow, the production capacity and sales are basically matched, and the capacity utilization rate is relatively high. In recent years, technical transformation or new projects have been continuously promoted to increase production capacity. Overall, the w88's capacity construction and water source reserves can adapt to the needs of future long-term development."

Zhu Danpeng, vice president of the Guangdong Food Safety Promotion Association, told the Securities Daily reporter: "w88 has not yet achieved nationalization and omni-channel operation. It only has a certain coverage in special channels such as aircraft and high-speed rail, and has not appeared much in mainstream traditional channels of Volkswagen. Therefore, its overall size is small and its profit is low. In addition, w88 is also involved in side businesses such as ginseng raw liquid and liquor. I think that when its main business is not strong, its side businesses are too many, and its front lines are too long, its development prospects are not optimistic."

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