On August 24, Mona Lisa Group Co., Ltd. (hereinafter referred to as "Mona Lisa") released its 2022 semi-annual report. The announcement shows that in the first half of 2022, Mona Lisa achieved operating income of 2.925 billion yuan, a year-on-year decrease of 5.06%; the net profit attributable to shareholders of listed companies was -488 million yuan, a year-on-year decrease of 273.08%.
As a leading A-share ceramic tile company that is about to celebrate its fifth anniversary on the market, Mona Lisa reported a loss for the first time in the first quarter of this year. The loss in the previous quarter was only 74 million yuan, while the loss in the semi-annual report sharply expanded to 487 million yuan. .
Revenue in the first half of the year fell by 5.06%
Net profit loss was 488 million yuan
The announcement shows that Mona Lisa achieved operating income of 2,924,560,900 yuan, a year-on-year decrease of 5.06%, and net profit attributable to shareholders of listed companies -487,554,200 yuan, a year-on-year decrease of 273.09%.
In response to the decline in performance in the first half of the year, Mona Lisa cited three main factors for operating performance in the report.
First, due to the recurrence of the domestic epidemic, Mona Lisa continued the strategy of sinking distribution channels and actively explored blank markets. Sales revenue from distribution business was 1,641.3086 million yuan, a year-on-year increase of 7.31%. However, the credit risk of some real estate customers has increased, and the risk of default is expected to expand. Based on risk prevention and control, it has adopted a prudent strategy and proactively reduced orders from some real estate customers with higher risks. The sales revenue of the strategic engineering business was 1,253,122,200 yuan, a year-on-year decrease of 15.56%, resulting in The company's overall operating income declined slightly.
Secondly, affected by the downturn and regulation of the real estate industry, some real estate companies have experienced liquidity problems. The number of real estate companies that publicly defaulted on their debts has gradually increased, and the expected default risk has expanded. During the reporting period, Mona Lisa’s accounts receivable and Overdue bill collection increased significantly. The management analyzed and evaluated the recoverability of some real estate customers' receivables as of June 30, 2022, and believed that there were obvious signs of impairment. During the reporting period, a corresponding credit impairment loss of approximately RMB 511 million was accrued.
Third, during the reporting period, the prices of energy and some raw materials still rose and continued to run at high levels, which had an impact on its profits.
Affected by the above-mentioned factors, Mona Lisa suffered a significant loss in the first half of the year, turning from profit to loss year-on-year. In this regard, Mona Lisa stated that during the reporting period, the net profit loss was mainly caused by the provision of large credit impairment provisions and the increase in raw material prices, which will not affect its normal production and operations, and it has increased the control of receivables in the first half of the year. Strength, sales collection increased, and capital investment was reduced. At the end of the reporting period, the balance of monetary funds was relatively abundant, and the net cash flow from operating activities increased compared with the same period last year, which can effectively protect the company's solvency.
ThreeA commitment project to raise funds
Failed to meet planned progress or expected revenue
The announcement also showed that Mona Lisa's "acquisition of Zhimei Shande" project did not reach the expected income, and the project suffered a loss of 29.1531 million yuan during the reporting period.
The main reasons are: affected by the epidemic in the first half of 2022, strict epidemic prevention and control measures were implemented in various places, logistics and personnel movement were restricted, energy prices remained at a high level, and raw material prices increased significantly, which compressed the profit margin of Jiangmeng Company. This resulted in a loss, resulting in the acquisition of 58.9706% equity of Zhimeishande failing to achieve expected benefits.
In addition, Mona Lisa’s “technical renovation of machinery and equipment and environmental protection facilities” and “digital management system and smart warehouse construction” projects have not reached the planned progress.
Mona Lisa stated that the reason why the technological transformation project for updating machinery, equipment and environmental protection facilities did not meet the planned progress is that the implementation entity of the project is the company's holding subsidiary Jiangmeng Company. Due to the impact of the epidemic in the first half of 2022, various places Strict epidemic prevention and control measures were implemented, logistics and personnel movement were restricted, and equipment procurement, logistics transportation, installation and commissioning were affected to a certain extent, resulting in delays in equipment procurement, installation, commissioning, and acceptance of the project, causing the project progress to fail to reach the scheduled status. In order to use the raised funds reasonably and effectively and ensure the comprehensive and steady progress of the project, after careful study by Mona Lisa, it was decided to put the "updation of machinery, equipment and environmental protection facilities into technical transformation projects" to reach the scheduled usable state by July 31, 2022. The date has been extended to December 31, 2023. The proposal was reviewed and approved at the 19th meeting of the third board of directors and the 15th meeting of the third board of supervisors respectively.
In response to the situation that the digital management system and smart warehouse construction projects have not reached the planned progress, Mona Lisa said that due to increasing production capacity layout and purchasing office buildings, investment in fixed assets has increased significantly. However, due to the impact of the epidemic and real estate The industry continues to be regulated, market demand is weak, and the number of real estate companies that publicly anticipate defaults continues to increase. Their main business has also been affected to a certain extent, and the progress of the collection of accounts receivable by real estate companies has also been greatly affected, which has a greater impact on the company's operating activities. . In response to multiple uncertainties such as the current epidemic, real estate regulation, and the international situation between Russia and Ukraine, the progress of Mona Lisa's digital management system and smart warehouse construction projects has also been affected to a certain extent, and project advancement and payment have been delayed.
Start from five aspects
Improve performance over time
In order to reverse the decline in both revenue and net profit, Mona Lisa started from five aspects to gradually improve its performance.
First, assess the situation and adjust business ideas and strategies in a timely manner. Various factors at home and abroad and manyUnder the influence of heavy headwinds, the overall development of the industry has slowed down. The management made corresponding adjustments to the company's business ideas and strategies in a timely manner.
The second is to strengthen risk management and control to ensure operating cash flow. Faced with the challenges and opportunities of a cold market, Mona Lisa continues to develop and maintain sales channels, while strengthening risk control and management, taking cash flow management from operating activities as an important starting point. In the context of real estate control, Mona Lisa proactively controls investment in projects with slow payment returns and high risks, continues to cooperate with high-quality engineering customers, simultaneously continues to strengthen C-end sales, and actively expands sales channels; optimizes product sales structure, and revitalizes inventory products and speed up sales collection. At the same time, we will strengthen cost and expense control; increase efforts to control receivable risks, and assign dedicated personnel to strengthen the collection of receivables.
The third is to adhere to the development path of technological innovation, quality and efficiency improvement. Mona Lisa adheres to the innovation-driven development strategy, adheres to the policy of "production for one generation, reserve for one generation, and R&D for one generation", and gradually improves the "research-development-application" three-level technology development and technology reserve system. Relying on innovation platforms such as the National Enterprise Technology Center, a series of functional products have been launched.
The fourth is to rely on the "Three Beauties" quality management model to steadily advance digital work, strengthen brand marketing, and promote performance improvement.
The fifth is to optimize internal management and promote lean operations. By continuously optimizing and improving enterprise management processes, we use standardized management to improve operation and management efficiency and promote the improvement of enterprise operation efficiency; we increase investment in informatization and develop or improve and upgrade multiple systems such as production, supply, and sales to improve operation and management efficiency.
Mona Lisa said that in the second half of the year, it will continue to optimize its sales structure and strengthen the management and control of receivable risks. At the same time, it will strive to gradually improve its annual performance through measures to reduce costs and fees, improve quality and efficiency.
