Securities Announcement No.: 3 Zhang Jia Jie Tourism Group Co.Ltd(000430) 13002
Announcement on the reply to the letter of concern of Shenzhen Stock Exchange
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.
Risk tips:
The expected total investment of the company is 2 billion yuan, which is implemented by stages according to the business situation. It is planned to be completed from 2022 to 2032, and it is expected to reach the goal of annual output value of 2 billion yuan in 2032. Due to the possible impact of national policies, external business environment, market price, R & D progress, technological iteration, financing environment and the complexity of project implementation, there are still uncertainties in the amount of investment, output value and investment income in the later stage of the project. The company will also adjust the investment plan according to the actual operation and capital situation of Jiangxi Changfang, Please pay attention to the risk that the project investment and project implementation are not as expected.
Shenzhen Changfang Group Co.Ltd(300301) (hereinafter referred to as “the company”) received the letter of concern on Shenzhen Changfang Group Co.Ltd(300301) (GEM concern letter [2022] No. 235) from the management department of gem company of Shenzhen Stock Exchange on May 11, 2022. The reply to relevant questions is announced as follows: on May 6, 2022, your company disclosed the announcement on the proposed termination of the original investment plan and the signing of a new investment agreement, The company plans to terminate the investment agreement (hereinafter referred to as the “original investment plan”) signed with the Management Committee of Nanchang Airport Economic Zone (hereinafter referred to as the “Airport Management Committee”), and sign a new investment agreement (hereinafter referred to as the “new investment plan”) with the management Committee of Nanchang Economic and Technological Development Zone. It plans to invest in advanced LED packaging and mini led expansion projects in Nanchang Industrial Park. According to the announcement of the resolution of the board of directors disclosed by your company on the same day, director Liang Dacheng voted against the proposal and believed that the demonstration of the necessity, rationality and feasibility of the relocation was insufficient. The counterparty should be prudently identified as a related party, and the related directors should avoid voting; Fang Zhigang, an independent director, abstained from voting on this proposal. Our department is concerned about this. Please verify the following items and make further explanations:
1. About the original investment plan. On July 3, 2018, your company disclosed that it signed an investment agreement with the airport management committee. The company plans to invest in its own packaging equipment, and the airport management committee plans to invest in cash through the industrial guidance fund to jointly invest and establish a project company, with a total investment of no less than 2 billion yuan. On March 19, 2019, the company disclosed that the adjustment of the above-mentioned agreement was that the company first invested 310 million yuan in machinery and equipment to establish the project company, and then Nanchang airport industry Equity Investment Management Co., Ltd. (hereinafter referred to as “airport industry investment company”) or a third party designated in writing by the airport management committee industry guidance fund manager, invested 300 million yuan to the project company in the form of capital increase and share expansion within the period confirmed by both parties. On April 3, 2019, the company invested in the establishment of Jiangxi rectangular semiconductor technology Co., Ltd. (hereinafter referred to as “Jiangxi rectangular”) with a registered capital of 310 million yuan. Later, the project was delayed due to financing and epidemic situation. Please your company:
(1) Explain the specific reasons why the agreement adjustment is the company’s first investment in machinery and equipment, and whether the agreement adjustment matters comply with the review procedures according to law.
The reply is as follows:
In order to improve efficiency and speed up the implementation of cooperative investment, after consultation and confirmation with airport industrial investment company, the company first invested with machinery and equipment to establish a wholly-owned subsidiary Nanchang project company in the park of Nanchang Airport Economic Zone, and airport industrial investment company or its written designated third party will increase the registered capital to Nanchang project company in the form of capital increase and share expansion.
The above changes are to improve efficiency and speed up the implementation of cooperative investment. They have not changed the essence of joint foreign investment. They have been deliberated and adopted at the 32nd meeting of the third board of directors of the company and do not need to be submitted to the general meeting of shareholders for deliberation. Therefore, the adjustment of the agreement has fulfilled the deliberation procedures in accordance with the law.
(2) Explain whether the company has agreed and confirmed the specific capital increase period with the airport industry investment company after the adjustment of the agreement, whether the airport industry investment company has increased the capital according to the agreement, whether it constitutes a breach of contract, and whether the company has taken relevant measures to safeguard the interests of the listed company.
The reply is as follows:
After the adjustment of the agreement, both parties agreed that within 4 months after the actual production tax of Nanchang project company in the airport reaches the standard, after the approval of the District Management Committee, both parties will increase their capital in the form of capital and shares. Later, due to the financing delay of the partners, the impact of the epidemic and the capital restriction of the company, the company only registered and established the Nanchang project company, namely Jiangxi long. As the company fails to fulfill the obligation of equipment investment and Jiangxi rectangle has not actually operated, Lingkong industrial investment company does not constitute a breach of contract.
(3) Explain the details, category, source, purpose, use, original book value and net value of the main assets invested by the company with machinery and equipment, and the determination method and process of capital contribution pricing. If the evaluation is carried out, further explain the evaluation method, key parameters, basis for selection of key assumptions, evaluation process, etc., and explain whether the capital contribution pricing price is fair and reasonable.
The reply is as follows:
The main assets of the company to be invested by machinery and equipment in 2019 are shown in the table below, which are all the production equipment purchased and in use by the company in previous years. The relevant evaluation was not conducted because the equipment was not actually invested.
Unit: 10000 yuan
Net value (as of category, quantity (set) original book value, accumulated depreciation and impairment provision
To the end of 2018)
Crystal fixing machine 683.001667522839957 664.16761149
Wire welder 586.001869329996446 528.94819990
Dispensing and powder dispenser 291.00429464209893 857.25133845
Beam splitter 702.001142828479771155302507755
Taping machine 433.00711165289025 851.45336995
Other equipment 42 Konka Group Co.Ltd(000016) 81869964705 802.95636869
Total 689500750217737797975257763196603
(4) Combined with the actual progress of the original investment plan and the specific obstacles in the implementation process, explain the reasons and rationality of the company’s termination of the original investment plan.
The reply is as follows:
After signing the agreement related to the original investment plan, the company completed the industrial and commercial registration procedures of Nanchang project company on April 3, 2019, obtained the business license issued by Nanchang administrative examination and approval Bureau, and established Jiangxi long. However, the project was delayed due to financing, policies and epidemic reasons.
Due to the comprehensive impact of covid-19 epidemic and intensified external competition, the company’s product and customer structure strategy needs to be adjusted in time to improve its competitiveness in the field of subdivision packaging, so as to improve the company’s profitability. The above investment cooperation methods need to be adjusted. In addition, since the airport management committee has been incorporated into the Management Committee of Nanchang Economic and Technological Development Zone (hereinafter referred to as “the Management Committee of Nanchang Economic and Technological Development Zone”), the cooperation subject needs to be changed to the Management Committee of Nanchang Economic and Technological Development Zone, the above signed agreements will be terminated and relevant termination agreements will be signed after consultation with the airport management committee.
2. About the new investment plan. The total investment of this project is still 2 billion yuan. The company plans to relocate 330 production lines of Huizhou factory to Nanchang Industrial Park, and Jiangxi long, a wholly-owned subsidiary, will be responsible for the follow-up production and operation. In the later stage, the mini LED packaging business will be carried out through the addition of packaging products and equipment. After the project is completed, it is expected to increase the high-end packaging capacity by 2500 KK / month, and the annual output value is expected to reach 2 billion yuan. According to the company’s annual report in 2021, the average monthly packaging capacity of LED packaging business is about 2651kk / month. The company’s operating revenue after deduction in 2021 is 1.011 billion yuan, and its net assets at the end of the year are only 786 million yuan. Please your company:
(1) Supplement and disclose the specific time arrangement for the investment and construction of new projects and reaching production capacity, and whether the Management Committee of the partner Nanchang Economic and Technological Development Zone still has a capital increase plan. If not, please explain the reason and necessity for the company to still plan to invest 2 billion yuan without the capital increase of the partner.
The reply is as follows:
Jiangxi long is still a wholly-owned subsidiary of the company, and the Management Committee of Nanchang Economic Development Zone has no capital increase plan for it. The expected total investment of the company is 2 billion yuan, which is implemented by stages according to the business situation. It is planned to be completed from 2022 to 2032, and it is expected to reach the goal of annual output value of 2 billion yuan in 2032. In 2022, the production line and other packaging assets of Huizhou factory will be relocated to Nanchang and operated by Jiangxi rectangle. It is estimated that 50% of the packaging equipment of Huizhou factory’s existing capacity will be relocated to Nanchang for operation at the end of September 2022, and the rest will be relocated to Nanchang at the end of November 2022. From 2022 to 2025, invest about 600 million yuan (including relocated equipment, inventory, accounts receivable, etc.) to improve the existing production capacity to meet the production needs of the company’s high-voltage and full spectrum products; From 2026 to 2030, invest about 800-1 billion yuan to import Mini LED products; From 2031 to 2032, about 400 million yuan will be invested to improve the production capacity of mini led to achieve the planning goal. It is expected to reach the design production capacity with an annual output value of 2 billion in 2032.
Due to the increasingly fierce market competition, the company’s LED packaging products need to be transformed. In addition, the labor cost in the Pearl River Delta has risen sharply in recent years, led enterprises have moved to Jiangxi. In order to improve the profitability of the company’s packaging business, it is necessary for the company’s packaging business to move to Nanchang and invest in R & D and production of new products. The specific reasons are as follows:
1) It can optimize the company’s product structure and improve profitability: due to the increasingly fierce market competition, the company’s existing low-voltage packaging products need to be fully upgraded to high-voltage LED products. At the same time, in order to improve the profitability, the company plans to expand the full spectrum led and mini LED product lines, However, the existing production line equipment and its layout (the dispensing and spectroscopic process of the products to be produced in the future is different from the existing white light products, so the existing spectroscopic machine needs to be technically transformed.) It is difficult to meet the needs of product upgrading. It is necessary to make a unified plan for production line layout in combination with Huizhou production line relocation, and invest in R & D of new products to meet the company’s product transformation and upgrading plan.
2) We can make better use of the local LED industry resources in Nanchang: as the company has been in the relatively traditional LED packaging field, it has previously focused on improving the delivery yield and product cost, and is weak in new product R & D and industrial chain cooperation. Nanchang has become China’s LED industry cluster. There are a large number of local led enterprises and industrial resources, such as chip manufacturing enterprises Xiamen Changelight Co.Ltd(300102) , zhaochi optoelectronics, etc. after moving to Nanchang, the company can make full use of the local LED industry resources in Nanchang, strengthen industrial cooperation, better cooperate with chip suppliers to speed up the R & D of mini LED packaging products, and customize the electrode size, chip brightness, voltage and wavelength we need, So as to accelerate the industrialization progress of mini products and improve the competitiveness and profitability of the company’s products.
3) We can expand other high-end products and customers with conditions: in the current customer structure of the company, customers of low-end products still account for a large share, but these customers have low gross profit level, scattered orders and large periodic changes. The current production environment of the company’s workshop (such as space, temperature control and cleanliness) can not meet the needs of new products and high-end customers in the future. On the one hand, after moving to Nanchang, the company will expand the high-end product line of old customers, At the same time, it will also increase the demand of other potential high-end products.
4) It can greatly save production costs and improve management efficiency: after moving to Nanchang, according to the policies of the local government, the company will save some fixed costs, and the labor cost is also lower than that in the Pearl River Delta; At the same time, since the main production base of the subsidiary kangmingsheng is also concentrated in Yichun, Jiangxi Province, the relocation of the packaging business to Nanchang will help the company strengthen the management of kangmingsheng and improve the management efficiency.
(2) Explain whether the company has sufficient funds or assets to carry out project construction and specific sources of funds in combination with the company’s cash flow and available assets.
The reply is as follows:
The early stage of Jiangxi Nanchang project is mainly to relocate Huizhou factory production line and packaging assets to Nanchang, which requires less capital investment. The required expenses mainly include relocation expenses, plant decoration expenses, personnel disposal expenses and real estate rental expenses. Most of the expenses can be solved through the policy support of the local government.
At present, the assets available to the company mainly include LED light source packaging equipment, inventory, accounts receivable, etc. only a small amount of funds need to be supplemented after moving to Nanchang, Jiangxi Province. The company plans to finance with machinery and equipment financial leasing or bank loans to solve the problem of replenishing a small amount of equipment and supplementary funds for production and operation in the early stage. The corresponding financial expenses can also apply for government subsidy support within a certain range.
According to the company’s production and operation development and new product R & D progress, the funds required for the later investment plan of Jiangxi Nanchang project can be financed through the capital market or seek to increase mortgage loans from banks by using Pingshan Industrial Park and Jiangxi Industrial Park, so as to meet the capital needs of new projects and new products.
To sum up, through the relocation of existing packaging equipment, inventory, receivables and other assets, use Pingshan Industrial Park, Jiangxi Industrial Park and other long-term assets to increase mortgage loans or raise funds by adjusting asset structure; Combined with capital market financing, the company can raise corresponding funds
