Event description
Pegasus International supply chain Co., Ltd. announced that the company has received 18647843.00 yuan in case enforcement money transferred by the court on August 14, 2013. At this point, the company and Jiangsu Qionghua Group Co., Ltd. ensure that the contract dispute case has been completed.
Event comment
The capital business encountered a default, and 21 million of bad debts were set aside in advance. Pegasus International signed the supply chain Service Framework Agreement with Yangzhou Noah Chemical Co., Ltd. and Yangzhou Qionghua New Materials Co., Ltd in July 2008. it is agreed that the company will provide supply chain services such as supply chain services, capital flow services and information flow services for Noah Chemical and Qionghua. According to the above framework agreement, the plaintiff signed several "purchase and sales contracts" with Noah Chemical and Qionghua New, respectively, determining the specific contents of the designated supplier, the variety, specification and model of the goods purchased, quantity, price, liability for breach of contract, and so on, and perform them one by one in accordance with the agreement. Due to the late implementation of the contract encountered breach of contract, the company filed a lawsuit against Qionghua Group to recover the accounts. In the 2011 annual report, the company has made a full provision for bad debts on the basis of the 21804875.16 yuan receivable from Noah Chemical and Qionghua.
All the bad debts were recovered, and the rebate increased the company's current net profit by 10 million. In this case, the Futian District people's Court of Shenzhen issued a "Civil Mediation statement" and ruled that Jiangsu Qionghua Group Co., Ltd. should pay a total of 28750496.18 yuan to the company. And received the court transfer of 10000000.00 yuan for the execution of this case on December 10, 2012. This year, the company received 18647843.00 yuan in case enforcement money transferred by the court on August 14, 2013. At this point, all the execution of the case has been completed, and the company's net profit is expected to increase by 10.83 million yuan in 2013.
Tax concessions and bad debt clawback for this year's performance guarantee, carefully recommended. From the split of the company's interim report, the contribution to the year-on-year growth of the company's medium-term performance mainly comes from tax incentives and government subsidies. Together, the above two items contributed about 14 million of the performance increment, while the net profit of the company in the middle of 13 years was only 10 million yuan higher than that in the middle of 12 years. Therefore, we believe that the company's main business is still at the bottom of the economic cycle and has not yet come out of the doldrums, but coupled with government subsidies and tax incentives, including the recovery of bad debts this time, the company's 13-year performance has achieved a considerable degree of guaranteed income. In addition to the current bad debt rebate, we expect the company's 13-15 EPS to be 0.26,0.30 and 0.38 yuan respectively, corresponding to an EPS of 23 EPS 20 and 16 times. In view of the unsustainability of the performance guarantee, we should maintain cautious recommendations.