On February 11, Suning.Com Co.Ltd(002024) (002024. SH) replied to the attention letter of Shenzhen Stock Exchange, referring to the basis for confirming the investment loss of RMB 3.5 billion and the impairment provision of long-term equity investment of RMB 8.2 billion for the net loss share of Shanghai Xingtu Financial Services Group Co., Ltd. (hereinafter referred to as “Xingtu financial services”).
On the evening of January 28, Suning.Com Co.Ltd(002024) released the performance forecast of 2021 and the suggestive announcement of the expected provision for impairment and investment loss. Suning.Com Co.Ltd(002024) disclosed that it will share the net loss of Xingtu financial services of the associated company, confirm that the investment loss of Xingtu financial services in the current period is about 3.5 billion yuan, and the impact on the net profit attributable to the shareholders of the listed company is about 2.6 billion yuan. The following day, we received the letter of concern from Shenzhen Stock Exchange.
According to the analysis of the reply letter, the Internet financial industry where Xingtu financial services is located is in the adjustment cycle, and the asset liability scale of Xingtu financial services is reduced; At the same time, the quality of loan assets of its factoring companies and small loan companies decreased. Xingtu financial services has made various impairment provisions. Affected by the above factors, the financial services company suffered a loss in 2021. Suning.Com Co.Ltd(002024) confirm the investment loss of 3.5 billion yuan.
According to the analysis of senior financial professionals, the net profit and loss brought to Suning.Com Co.Ltd(002024) by Xingtu financial services in 2021 adjusted according to the equity method was – 3.5 billion yuan. Based on the shareholding ratio of about 41.1%, the net profit and loss of that year reached – 8.5 billion yuan. Combined with the reply letter, it also included the provision for impairment, such as accounts receivable; At the same time, another third-party evaluation agency estimated that Suning.Com Co.Ltd(002024) had an impairment loss of 8.2 billion yuan on the long-term equity investment of Xingtu financial services, some of which may coincide with the impairment accrued by Xingtu financial services. The audited data will be disclosed in the annual report.
In addition, according to the disclosed provision for investment impairment of 8.2 billion and shareholding ratio of 41%, if only calculated by the third-party evaluation agency hired by Suning.Com Co.Ltd(002024) , the overall valuation of Xingtu financial services will be sharply reduced by about 20 billion. People in the financial industry mentioned that if the listed company withdraws a large impairment loss at one time, it may weaken the impact of the subject matter on the next reporting period.
In September 2019, Xingtu financial services (formerly Suning financial services) completed the c-round capital increase and share expansion, diluted the shareholding ratio of Suning.Com Co.Ltd(002024) from 50.1% to 41.15% and lost control. In that month, Suning.Com Co.Ltd(002024) confirmed that the long-term equity investment value of Xingtu financial services was about 23.4 billion yuan. After the capital increase and share expansion and the statement of Xingtu financial services, the net profit of Suning.Com Co.Ltd(002024) increased by 9.857 billion yuan in that year.
In 2019 and 2020, the net profit of Xingtu Jinfu was 1.11 billion yuan and 1.574 billion yuan respectively. Since the statement was issued at the end of the third quarter of 2019, Suning.Com Co.Ltd(002024) the long-term equity investment income of Xingtu financial services in that year should be based on the net profit of 490 million yuan in the fourth quarter. The long-term equity investment income of Xingtu financial services was confirmed to be 202 million yuan and 648 million yuan in 2019 and 2020 respectively.
And confirmed the long-term equity investment income of Xingtu financial services in 2019 and 2020, which were 202 million yuan and 648 million yuan respectively. In the past two years, the net profit of Xingtu Jinfu was 1.11 billion yuan and 1.574 billion yuan respectively. Due to the statement at the end of the third quarter of 2019, Suning.Com Co.Ltd(002024) the long-term equity investment income of Xingtu financial services in that year should be based on the net profit of 490 million yuan in the fourth quarter. In that year, after the capital and share increase transaction of Xingtu financial services was published, the net profit of Suning.Com Co.Ltd(002024) 2019 increased by 9.857 billion yuan.
Due to the changes in the industry and the loss of Xingtu financial services, Suning.Com Co.Ltd(002024) hired a third-party evaluation agency and concluded that the impairment loss of long-term equity investment in Xingtu financial services was about 8.2 billion yuan. According to the 2020 annual report, Suning.Com Co.Ltd(002024) the long-term equity investment in Xingtu financial services included at that time was about 24.13 billion yuan.
In 2016, the former Suning cloud business ( Suning.Com Co.Ltd(002024) ) announced that it planned to integrate its third-party payment, supply chain finance, wealth management, insurance sales, fund sales, crowdfunding and prepaid cards, build Suning financial service platform, and plan to introduce strategic investors through capital and share increase. Suning financial holding invested 5.834 billion yuan and held 35% of the equity after the capital increase and share expansion of the original Suning financial services, with a post investment valuation of 16.667 billion yuan. In April 2016, the former Shanghai Changning Suning yunshang Sales Co., Ltd. was renamed Suning financial services (Shanghai) Co., Ltd.
In 2017, the former Suning financial services introduced Yunfeng fund, Macrolink Culturaltainment Development Co.Ltd(000620) , Shenzhen Venture Capital and other investors. Yunfeng Xinchuang invested 1 billion yuan and obtained 3.093% of the shares after the capital increase. According to the capital increase agreement, the original Suning financial services increased its capital and shares by 16.5% to investors, raising a total of 5.335 billion yuan and a post investment valuation of 32.335 billion yuan.
In 2019, the former Suning financial services (Xingtu financial services) carried out round C capital and share increase. Investors include Suning financial holding Investment Co., Ltd. (hereinafter referred to as “Suning financial holding”) and its designated entity, jiaxingrun SHIYIFANG equity investment partnership (limited partnership), Fujian Xinghe Haokang equity M & a partnership (limited partnership), etc. with a pre investment valuation of 46 billion yuan, they increased capital and shares by 17.857% of new shares to investors in this round, raising a total of 10 billion yuan and a post investment valuation of 56 billion yuan. At the end of the same year, the former Suning financial services (Shanghai) Co., Ltd. was renamed Shanghai Suning Financial Services Group Co., Ltd. (hereinafter referred to as “Suning financial services”).
In October 2021, Suning Jinfu changed its name to Xingtu Jinfu. At present, Xingtu financial services is wholly-owned, including Nanjing Suning fund sales Co., Ltd., Xinglian commercial factoring (Tianjin) Co., Ltd., Nanjing Suning yifubao Network Technology Co., Ltd., Suning financial leasing (Tianjin) Co., Ltd., Xi’an Suning microfinance Co., Ltd., Nanjing Xingcan Insurance Agency Co., Ltd., Chongqing Xingyu microfinance Co., Ltd, Involving third-party payment, fund sales, financial leasing, commercial factoring, insurance agency and small loan license.
According to the official website, Suning financial’s products include yifubao, capricious payment, zero wallet, zero purse, Suning financial management, etc., which intersect with some subsidiaries of Xingtu financial services.
Except for Suning.Com Co.Ltd(002024) , the top four shareholders of Xingtu financial services belong to Suning department, including Nanjing Runyu enterprise management consulting center, Suning financial holding and Nanjing zeding enterprise management consulting center (limited partnership), holding about 24%, 21.2% and 3.4% respectively. Other shareholders of Xingtu financial services also include Shanghai Yunfeng Qitai Investment Center (limited partnership), Zhijiang new industry Co., Ltd., new China Union Holdings Ltd(000036) , and Dalian Centennial Jinshi enterprise management service partnership (limited partnership). The shareholders involved in a large number of indirect shares behind the limited partnership include CITIC Trust, Minsheng trust, Yintai investment, ICBC international, CICC, etc.
