AutoBeta(AutoBeta.net)03/02 Report--

Since Zhongtai Motors fell into bankruptcy, litigation and other scandals at the end of last year, the company is expected to write down its goodwill by about 6 billion yuan in 2019. To this end, the Shenzhen Stock Exchange issued a letter of concern to Zhongtai Automobile, which needs to be supplemented by the specific changes in the company's current operating results and signs of impairment of goodwill.

In response to this, Zhongtai Motor recently replied to an inquiry letter from the Shenzhen Stock Exchange that Yongkang Zhongtai has formulated a detailed business plan, and will plan to resume production of some models in batches according to market conditions and the company's own conditions. the production lines of some models have been suspended.

As of December 31, 2019, the fair value of the proposed production line that is continuously measured at the fair value of the purchase date accounts for 9.14% of the total assets purchased on the purchase date, and the suspension of production will not have a significant impact on the production and operation of the company.

Zhongtai Motors said that since the impairment assessed by the income method is greater than the carrying value of goodwill allocated by the portfolio of assets related to resumption, the book value of goodwill is fully impaired. For discontinued and decommissioned asset groups, as they can no longer benefit from the synergy of business consolidation, the full impairment of goodwill allocated to the portfolio of discontinued and decommissioned asset groups is expected. Combined with the two parts, the full amount of goodwill is provided for impairment, the amount is about 6 billion yuan.

In 2016, although Zhongtai failed to meet the performance commitment of 1.41 billion yuan, it still achieved deduction of 1.233 billion yuan in non-return net profit, resulting in the accumulation of goodwill. It fell in 2017 but still achieved 1.136 billion in profit and revenue; but it lost 491 million yuan in net profit by 2018, although Zhongtai Motor set aside 320 million yuan of goodwill in 2018 despite an inquiry after the exchange. By the end of 2018, after calculating the goodwill, Zhongtai Motor acquired the remaining goodwill of Yongkang Zhongtai still has 6.259 billion yuan.

As mergers and acquisitions of listed companies can bring more possibilities to companies, but high premium mergers and acquisitions will lead to the formation of a huge amount of goodwill, once the performance of M & An assets is not up to standard, goodwill impairment may "explode" at any time. The company expects a loss of 6 billion yuan to 9 billion yuan in 2019, compared with a profit of 800 million yuan in the same period last year, so that Zhongtai Motor almost finished its goodwill impairment, according to a forecast issued by Zhongtai Motor on January 20.

For the reasons for performance losses, Zhongtai said that there are mainly two aspects: first, the overall prosperity of the automobile industry is not high, and the company's car sales have dropped sharply, which did not meet expectations. According to the principle of prudence, it is proposed to set aside a large amount of impairment provision for goodwill. It is estimated that the provision for impairment of goodwill is about 6 billion yuan; second, due to a sharp decline in sales, the company's operating income has dropped sharply, and operating costs have risen relatively, resulting in large operating losses.

However, Zhongtai said that the projected revenue growth in 2021 will expand compared with 2020, because the first quarter of 2020 is still under commissioning and production is low. However, the model codenamed A16 has been basically developed and is waiting to be put into production. It is expected to be put on the market in 2020. The new car has a climbing period of about six months and reaches a stable period by 2021, with sales higher than in 2020. In addition, the model codenamed B21 is expected to be completed by the end of 2020 and be launched in 2021. As the company's new flagship model, it has a strong competitiveness among similar models in the market, resulting in an increase in sales and revenue. And this is also the new car research and development that Zhongtai mentioned leads to an increase in operating costs. Obviously, Zhongtai still has great expectations for future market performance.

In fact, since last October, Zhongtai Automobile was revealed to have been caught in a thunderstorm crisis in the capital chain, and was accused of a bank's risk screening of about 50 billion yuan in bad debts of four car companies, including Zhongtai enterprises, which will enter the bankruptcy process by the end of the year. In this regard, Zhongtai also refuted the rumor statement, and said it had reported the case. However, a few days later, it was revealed that Zhongtai Motor had been taken to court by Bic Battery to freeze its assets of more than 40 million yuan because it owed hundreds of millions of yuan to Shenzhen Bic Power Battery Co., Ltd., a lithium battery supplier. Until the end of the year, many companies, such as upstream suppliers Rongbai Technology and Dangsheng Technology, exposed that receivables were in arrears and all resorted to law.

Even the Tieniu Group, the parent company of Zhongtai Motor, has repeatedly informed Zhongtai Motor that all its 786 million shares have been judicially frozen and most of the related shares have been pledged, under the circumstances, the promise to complete the cancellation of the shares scheduled for the end of November can not be fulfilled.

Judging from these signs, Zhongtai Motors, which originally had an avalanche of sales, has made it difficult to improve its performance, coupled with such a difficult "start" in 2020, Zhongtai Motors will be difficult to carry out even if it wants to achieve performance regulation.

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