① The company said that the suspended chairman can direct work and sign review documents; ② Currently, the company's pre-adjusted cocktail capacity utilization rate is 50%, and finished whiskey products will be released in the fourth quarter; ③ the increase in inventory last year and the first quarter was mainly due to an increase in whiskey inventory, accounting for about 80%.
Financial Services Association, May 21 (Reporter Chen Kang) “Has the chairman come back? Does it have an impact on company management?” As soon as the results conference of Bairun Co., Ltd. (002568.SZ) began today, investors were intensively questioning the latest developments in Chairman Liu Xiaodong's placement. Geng Tao, director of the company, responded, “The chairman can direct the work and sign the review documents. The company will promptly announce any relevant developments.”
At the end of February, Liu Xiaodong, the chairman and actual controller of Bairun Co., Ltd., was investigated on suspicion of bribery. At the time, Bairun Co., Ltd. stated that as of the date of disclosure of the announcement, the company's control had not changed, the company's production, operation and management conditions were normal, and the above matters would not have a significant impact on the company's normal production and operation.
Geng Tao explained at the performance conference that at present, the company's overall production capacity utilization rate for pre-prepared cocktails is around 50%, the canning line is close to saturation, and production capacity expansion projects are under construction one after another. Strong sales were good in the first quarter, and the repurchase rate rose steadily.
Compared to the company's main product, “Rui Ao Cocktails,” investors were more concerned about the spirits business (mainly whiskey) that the company began promoting in 2021 at the performance conference. Geng Tao responded that the company's finished whiskey has not yet been sold and is expected to be released in the fourth quarter of this year. The released white spirits products mainly reflect the image of Laizhou Distillery and the position of high-quality white spirits, and are aimed at the B-end professional community.
Geng Tao said that in the company's financial report, the “other business revenue” in revenue is mainly revenue from sales of spirits by-products and other service income. With the sale of whiskey, revenue growth in the spirits sector is expected to be reflected in 2025.
Some investors noticed that the company's inventory increased significantly last year and the first quarter of this year. Ma Liang, the company's financial director, responded that the main reason was the increase in inventory of the whiskey maturing project. The inventory in last year's annual report included 300,000 barrels of bottled whiskey. Up to now, whiskey inventory accounts for about 80% of the total inventory; as the whiskey maturing project continues to advance, the trend of inventory growth will continue.
Regarding future product plans, Geng Tao said, “In the finished whiskey wine, the company will focus on brand incubation and product development for malt whiskey and blended whiskey; in the pre-blended cocktail series, the company will launch new products based on whiskey in the future.”
On the evening of May 16, the company announced the termination of the 2,025 billion yuan fixed increase plan proposed in August 2023. This amount of funding was originally used for capacity expansion projects, including Bacchus wine production and construction projects in four places including Jiangsu, Tianjin, Foshan, and Chengdu; in addition, the Bacchus Liquor (Chengdu) R&D and testing center project.
At the results meeting, some investors feared that the termination of the fixed increase would affect the whiskey project. Ma Liang replied, “After the termination of this fixed increase project, the implementation schedule for related construction projects (whiskey construction projects, maturing projects) will adjust the pace. In the future, the project will be completed through own capital, microfinance, and bank loans. The company will ensure the safety and stability of the funds.”
Furthermore, in response to the increase in marketing expenses in the first quarter, Ma Liang said, “The main reason is that the company optimizes the pace of annual advertising expenses and increases the proportion of advertising expenses in the first quarter under reasonable planning of advertising rates throughout the year. Looking at the annual growth rate of marketing expenses, the growth rate of marketing expenses will not be significantly higher than the revenue growth rate.”