Employee stock ownership plans are becoming more and more common in a shares, but have you ever seen an “Employee Stock Ownership Plan” that doesn’t need to pay for itself and has no performance indicators? On the evening of February 15, the science and innovation board company Fujian Forecam Optics Co.Ltd(688010) , which is mainly engaged in optical lenses, announced such a shareholding plan called “light chaser 1”.
10 directors, supervisors and 71 key employees are proposed to be allocated no more than 120000 shares. The shares are transferred by the shares repurchased by the company for 0 yuan without the investment of the participants. However, the repurchased companies spent a total of 3.12 million yuan. More importantly, there are no performance assessment requirements for “0 yuan purchase”. The explanation given by the company is that “the personnel participating in this shareholding plan are the core management team and backbone personnel of the company, which has an important impact on the business development and strategic realization of the company”.
But fund Jun found that the above statement of the company seems far fetched. From 2017 to 2020, the company’s operating revenue almost stagnated, and the deduction of non net profit continued to decline, from 81.72 million yuan to 38.1 million yuan. More importantly, more than half of the company’s profits after listing are contributed by raising funds to buy bank financial management and government subsidies. In 2020, the company’s investment income was 19.99 million yuan and “other income” was 17.97 million yuan, accounting for 69% of the total profit.
incentives or benefits?
According to the Fujian Forecam Optics Co.Ltd(688010) No. 1 shareholding plan (Draft), the participants are directors (excluding independent directors), senior managers, supervisors and key personnel who “play an important role and influence on the overall performance and medium and long-term development of the company”. The total number of employees participating in the shareholding plan is no more than 81, including directors (excluding independent directors), senior managers There are 10 supervisors.
The shares of the shareholding plan are transferred at zero price by the shares repurchased by the company, without the investment of the participants. The scale is no more than 120000 shares, accounting for 0.08% of the current total share capital of the company. The company completed a round of repurchase on May 12, 2021, and actually repurchased 1153000 shares of the company, accounting for 0.75% of the total share capital of the company. The average repurchase price was about 26.01 yuan / share, and the total capital used was 29.9921 million yuan (excluding transaction commissions, transfer fees and other transaction costs).
The shares obtained by the shareholding plan are unlocked in two phases. The unlocking time points are 12 months and 24 months from the date when the company announces the transfer of the last subject stock to the name of the shareholding plan. The proportion of the subject stock unlocked in each phase is 50% and 50% respectively.
It is puzzling that such a zero cost shareholding plan does not need performance evaluation, which is tantamount to unconditional free gift.
The company’s statement is that the personnel participating in the shareholding plan are the core management team and backbone personnel of the company, which has an important impact on the business development and strategic realization of the company, “Based on the affirmation and return of the past work and contributions of the above employees, in order to prevent brain drain, enhance the stability of the talent team and continue to develop together with the company for a long time, the enthusiasm and creativity of employees can be fully mobilized by appropriately reducing the performance threshold. Therefore, the company level performance assessment objectives are not set in this shareholding plan.”.
incentive expenses account for 10% of the net profit of the latest financial report
However, the so-called zero cost is ultimately borne by the listed company, that is, all shareholders.
Taking the latest closing price of 26.54 yuan / share of the company on February 15 as a reference, the company shall confirm that the total cost of this shareholding plan is expected to be 3.1848 million yuan, which shall be apportioned by the company according to the proportion of each lifting of the restriction during the lock-in period. According to the latest third quarterly report of 2021, Fujian Forecam Optics Co.Ltd(688010) recorded a net profit of 31.99 million yuan, and the equity incentive fee accounted for 10% of the net profit compared with the third quarterly report.
Such a big welfare is obviously impossible to be “sunny”. The 2020 annual report shows that the company has 1739 in-service employees including major subsidiaries, and 81 directors, supervisors, senior managers and key employees account for less than 5% of all employees.
performance in the last three years continued to decline
major contribution of financial management and government subsidies
The company attaches so much importance to the management and key employees, what is the performance?
Fujian Forecam Optics Co.Ltd(688010) mainly engaged in optical lenses and optical components. It was listed on the gem in July 2019.
Although the growth rate of the company’s main business before listing was slow, it still maintained growth, from 391 million yuan in 2015 to 552 million yuan in 2018, an increase of 41% in three years; The net profit increased from 75.72 million yuan to 91.39 million yuan, an increase of 20.69% in three years.
But after listing, it is completely another painting style.
In 2019 and 2020, the company’s operating revenue was 580 million yuan and 588 million yuan respectively, almost standing still; The net profit attributable to the parent company was 92.17 million yuan and 51.02 million yuan respectively, a decrease of 45%, and a decrease of 50% after deducting non recurring profits and losses. In the first three quarters of 2021, the company realized a net profit attributable to the parent company of 31.991 million, which continued to decline by 8.7% year-on-year, narrowing the decline. After deducting non recurring profits and losses, the company’s performance in the first period of recent three years continued to decline.
In addition, from the situation in 2020 and the first three quarters of 2021, the company’s performance actually comes not from its main business, but from the investment income of financial products and government subsidies.
In 2020, the investment income of Fujian Forecam Optics Co.Ltd(688010) will reach 1999 million yuan, and there will be 17.97 million yuan of “other income”, mainly government subsidies. The total profit of that year is 55.1 million yuan, accounting for 69%. In the first three quarters of 2021, this situation has not changed much. The investment income is 11.57 million yuan, “other income” is 6.13 million yuan, and the total profit is 31.35 million yuan, accounting for 56.45%.
The 2020 annual report shows that the investment income of Fujian Forecam Optics Co.Ltd(688010) mainly comes from bank financial products. The company bought nearly 600 million bank structured deposits, and the “investment income of structured deposits” reached 21.59 million yuan.
The company’s performance is mediocre. How can we buy so much money for financial management? The answer is to raise funds for IPO.
In 2019, after deducting the issuance expenses, the company actually raised 918 million yuan. In the whole 2020, 321 million yuan was invested in fund-raising projects, and 593 million yuan was bought for financial management. At present, the progress of the company’s raising and investment seems to be relatively slow. The third quarterly report of 2021 shows that the company still has 509 million yuan of “trading financial assets” on its account, mainly composed of bank structured deposits.
In 2020, the government subsidy received by the company was 19.79 million yuan, compared with 24.51 million yuan and 15.53 million yuan in the previous two years.
After two and a half years of listing, Fujian Forecam Optics Co.Ltd(688010) share price continued to decline after speculation at the beginning of listing, from a high of 94.91 yuan (former resumption of rights) to the latest 26.54 yuan, a decline of 72%.
