Behind the limit of the original Rongan Real Estate

Zhejiang Ningbo real estate developer Rongan Real Estate suffered a catastrophe in the A-share market today-the company’s share price gapped sharply and opened close to -7%, and then went down. It was hit to the limit at 10 o’clock and blocked the -10% limit. , Seems to have encountered some bad news, and the capital flight is obvious. Behind it is the 2020 annual report that it just disclosed.

During the reporting period in 2020, Rongan Real Estate achieved operating income of 11.178 billion yuan, a year-on-year increase of 67.77%, and realized net profit attributable to shareholders of the parent company of 1.743 billion yuan, a year-on-year decrease of 7.75%, excluding non-recurring gains and losses. After the net profit was 1.799 billion yuan, a year-on-year increase of 0.30%, the book performance is actually not bad.

According to the annual report basic earnings per share of RMB 0.5473, Rongan Real Estate’s current price-to-earnings ratio is 5.5 times, which is a significant downstream level among the real estate industry’s average value of about 9.5 times. So what exactly are funds fearing today?

I am afraid that the main concern is the corporate capital chain shown in Rongan Real Estate’s annual report. After all, real estate companies involve a wide range of funds and are most sensitive to capital chains in various industries. As of the end of 2020, Rongan Real Estate’s total monetary funds on the account was 8.628 billion yuan, an increase of 1.63 billion yuan over the same period last year. However, other data related to cash flow pointed to the company’s tight capital chain and poor-risk resistance. :

As of the end of 2020, the company has total assets of 67.768 billion yuan, total liabilities of 57.236 billion yuan, and a debt-to-asset ratio of 84.46%, which is an increase of 1.33% from the end of 2019, setting a new high for the company since 2009. The quick ratio is 0.28, which is lower than the same period last year. 0.1, operating cash flow per share-3.37 yuan, the worst in history.

There is also dissatisfaction with the company’s cash dividends being too stingy. Rongan Real Estate’s 2020 annual report intends to distribute a cash dividend of RMB 0.35 (tax included) to all shareholders for every 10 shares, with a total dividend of approximately RMB 111 million, accounting for only about 6% of the current net profit of RMB 1.743 billion, which is available for distribution in the consolidated financial statements at the end of the period. The profit of 6.459 billion yuan is 1.7%, and the scale is also lower than the 1 yuan (tax included) for every 10 shares in the same period last year. In addition, the company is very generous to its own executives, and generally raises salaries. At the end of 2020, the per capita annual salary of Rongan Real Estate’s executives was 623,200 yuan, which was an increase of about 15% from the end of the previous year. Among them, Wang Congwei, the general manager born in 1987, The salary increase was the largest, close to 50%, and the annual salary increased to 1,354,400 yuan Spark Global Limited.

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