With regard to the attention letter on Zhongtian Financial Group Company Limited(000540) , the attention letter of the company Department [2022] No. 101 Zhongtian Financial Group Company Limited(000540) the board of directors:
Your company disclosed the performance forecast for 2021 on January 29, 2022. Your company expects a loss of 2.5 billion yuan to 4 billion yuan in 2021, which is mainly due to the increase of borrowing costs included in profit and loss, the decrease of gross profit on real estate sales, and the large impairment loss and loss of changes in fair value of the asset side business invested by the financial subsidiary. Our department is concerned about this. Please check and explain the following items:
1. The performance forecast shows that the borrowing costs included in the profit and loss of your company increased compared with the same period of last year. Your company’s report for the third quarter of 2021 shows that your company’s short-term liabilities, current liabilities due within one year and other current liabilities Total 27.603 billion yuan and monetary capital 282 million yuan. Please explain your company’s interest bearing debts up to now, whether there is any record of overdue or default of debts, the amount involved, debt litigation and provision of estimated liabilities, the main reasons and rationality of the year-on-year increase in borrowing costs included in profits and losses, the estimated impact of relevant financial expenses and debt overdue on your company’s profits and losses, and whether your company has fulfilled its disclosure obligations in time.
2. In 2017, your company plans to purchase the equity of Huaxia Life Insurance Co., Ltd. (hereinafter referred to as “Huaxia insurance”) from Beijing Millennium Shihao and Beijing Zhongsheng century, and pay a deposit of 7 billion yuan. The above amount is reported as other non current assets. The performance forecast shows that due to the impact of the real estate industry, the business operations of some financial subsidiaries do not meet the expectations, and the asset side business invested by them will form a large impairment loss and loss from changes in fair value in 2021 compared with the same period of the previous year. Please explain the estimated amount and main calculation process of the provision for impairment of your company’s main assets, inventories of real estate projects and other non current assets, and whether there is a centralized and large amount of provision for asset impairment in 2021, and whether the provision for impairment in previous years is fully reasonable. The annual audit accountant shall check and give clear opinions.
3. On December 21, 2021, your company held a shareholders’ meeting to consider and approve the sale of 100% equity of Zhongtian Urban Investment Group Co., Ltd. (hereinafter referred to as “Zhongtian urban investment”), with a transaction price of 8.903 billion yuan, and the related transactions increased your company’s net profit by 1.1 billion yuan. The performance forecast shows that the structural difference between the real estate sales revenue carried forward by your company in 2021 and the sales revenue carried forward in the same period of last year has led to the decline of your company’s real estate sales gross profit in 2021. Please explain whether the sale of the above assets meets the conditions for revenue recognition in combination with the time point of equity delivery, capital payment, follow-up payment arrangements and main obstacles, the willingness and ability of both parties to perform the contract, and in combination with the product type, price change, cost composition and other factors of the real estate business, Explain the reasons for the year-on-year decline in the gross profit margin of real estate business during the reporting period, compare the gross profit margin and its change trend of similar products of Listed Companies in the same industry, and analyze and explain the differences and rationality. The annual audit accountant shall check and give clear opinions.
Please make a written statement on the above issues, submit the relevant explanatory materials to our department for disclosure before February 11, 2022, and send a copy to the dispatched office at the same time. At the same time, remind your company and all directors, supervisors and senior managers to strictly abide by the securities law, the company law and other laws and regulations, as well as the stock listing rules of the exchange, and perform the obligation of information disclosure truthfully, accurately, completely, timely and fairly.
We are writing to inform you that
Shenzhen Stock Exchange listed company management department I
January 30, 2022
