Stock Code: Jilin Liyuan Precision Manufacturing Co.Ltd(002501) stock abbreviation: ST Liyuan Announcement No.: 2022027 Jilin Liyuan Precision Manufacturing Co.Ltd(002501)
Announcement on the company’s outstanding losses reaching one third of the total paid in share capital
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
Jilin Liyuan Precision Manufacturing Co.Ltd(002501) (hereinafter referred to as “the company”) held the fourth meeting of the Fifth Board of directors and the third meeting of the Fifth Board of supervisors on April 28, 2022, and deliberated and adopted the proposal on the company’s outstanding losses reaching one third of the total paid in share capital, which needs to be submitted to the general meeting of shareholders for deliberation. The relevant information is hereby announced as follows:
1、 Overview of the situation
According to the audit report (yksz [2022] No. 01110849) issued by Asia Pacific (Group) Certified Public Accountants (special general partnership), as of December 31, 2021, the undistributed profit in the audited consolidated financial statements of the company was -678847795262 yuan, the amount of the company’s unrecovered loss was 678847795262 yuan, the company’s share capital was 35500000000 yuan, and the amount of the company’s unrecovered loss exceeded one third of the total share capital. According to the relevant provisions of the company law of the people’s Republic of China and the articles of association, when the amount of the company’s outstanding losses exceeds one third of the total share capital, it shall be submitted to the general meeting of shareholders for deliberation.
2、 Main reasons for losses
Since 2018, the company has had major difficulties in normal production and operation due to the rupture of capital chain, overdue debt and judicial litigation. The company had a large loss in 20182019. At the end of 2020, the company was ruled bankrupt and restructured by the court. The company implemented the restructuring plan and obtained the income from debt restructuring, realizing a net profit attributable to the shareholders of the listed company of 4.929 billion yuan, In 2021, the audited net profit attributable to the shareholders of the listed company was 449 million yuan. After deducting the net profit attributable to the shareholders of the listed company in the reporting period, the outstanding loss was still 6.789 billion yuan.
3、 Countermeasures
1. Steady growth in operating income: during the reporting period, the company achieved an operating income of 367 million yuan, an increase of 263 million yuan over the same period last year.
2. Continuous improvement of financial condition: during the reporting period, the company optimized the asset structure, integrated assets and liabilities, the asset liability ratio continued to decline, and the company’s financial condition continued to improve.
3. Continuous improvement of operating conditions: during the reporting period, the company’s net profit after deducting non recurring profits and losses was 591 million yuan, which was significantly reduced compared with the same period of the previous year. After the reorganization of the company, it has received strong support from governments at all levels, reached a willingness to cooperate with some large enterprise groups, and some products have been supplied.
4. Strengthen market development: by expanding marketing efforts, the company actively explores market potential, expands new sales fields and opens up more new customers. After the successful reorganization of the company in 2020, the cooperative relationship with some old customers is gradually recovering. The company plans to give more preferential policies to old customers and strive to restore the cooperative relationship to the greatest extent, so as to ensure the continuous increase of orders and the gradual recovery of production and sales in 2022.
5. Expenditure reduction: the company will further reduce unnecessary expenses such as management expenses in 2022, further strengthen the control and management of expense budget, improve the financial approval system and reduce expenses.
6. Reduce procurement cost: the company strengthens cooperation with suppliers, establishes a stable supply chain guarantee system, strives to reduce procurement cost, strengthen inventory management level, further improve inventory turnover rate and reduce production cost.
7. Increase capital investment: the company continues to invest in equipment technical transformation and environmental protection transformation and upgrading to ensure the continuous production and operation of the company.
8. Increase the recruitment of talents: the company widely recruits talents, increases the selection and employment of management personnel and technicians, increases the recruitment of skilled workers, stabilizes the core technicians and skilled workers, continues to expand the number of direct production personnel, improves the salary and treatment of employees, promotes the work enthusiasm of employees, stabilizes the workforce, and promotes the sustainable development of production and operation. 9. Improve the organizational structure: the company will gradually optimize and improve the organizational structure and department settings, deepen and improve the governance system of listed companies, standardize enterprise operation and management, and improve enterprise operation efficiency.
10. Support of controlling shareholders: the controlling shareholders continue to support the company’s business development in all aspects, support the company to supplement working capital, support the integration of assets and resources, and promote the company’s sustainable operation and sound development.
It is hereby announced.
Jilin Liyuan Precision Manufacturing Co.Ltd(002501) board of directors April 29, 2022
