① In 2023, Yuanwang Technology, the “first stock in live e-commerce,” continued to lose money, and the amount of loss increased; ② The market had long anticipated that Yuanwang Technology had no hope of reversing losses last year. The company lost 450 million yuan in the first three quarters of last year; ③ There were also highlights in Yuanwang Technology's operations last year, such as the total GMV of over 3.29 billion yuan during the Double Eleven period, an increase of 38% over the previous year.
Finance Association, January 30 (Reporter Wang Bin) After the name change, Yuanwang Technology (002291.SZ) does not seem to have changed operations. In 2023, Yuanwang Technology, the “first stock in live e-commerce,” continued to lose money, and the amount of losses increased.
This evening, Yuanwang Technology released a performance forecast stating that the company's net profit loss is expected to be 800 million yuan to 1.2 billion yuan for the full year of 2023, and the loss amount has increased. Based on this calculation, Yuanwang Technology lost 350 million yuan to 750 million yuan in the fourth quarter of 2023.
In addition, according to financial data, Yuanwang Technology lost 265 million yuan in 2022, and the company lost 700 million yuan previously in 2021.
As for the main reason for the loss in performance in 2023, Yuanwang Technology attributed it to operating losses in the footwear business, a sharp increase in the amount of bad debt preparation for the whole year due to an increase in accounts receivable age, an increase in investment in new consumer projects such as Yuanwang X27 PARK, and a decline in the average revenue scale and net profit level of the fashion new media business.
In fact, the market had long anticipated that Yuanwang Technology had no hope of reversing losses last year. According to financial reports, in the first three quarters of 2023, Yuanwang Technology lost 450 million yuan in net profit to mother, with an average daily net loss of nearly 2 million yuan. In terms of cash flow, the company's net operating cash flow during the same period was an outflow of 333 million yuan, which further increased the year-on-year net outflow.
As the “first stock in women's shoes” in the A-share market, Yuanwang Technology purchased Hangzhou Yuanwang for 1,771 billion yuan in 2019 and transformed into an internet advertising business. In December 2022, Yuanwang Technology officially transformed, and the stock abbreviation was changed from “Saturday” to “Yuanwang Technology”. Currently, about 90% of the company's revenue comes from the Internet advertising industry, mainly Internet advertising and social e-commerce services.
It is worth noting that although the revenue of Yuanwang Technology continued to rise after the transformation, net profit continued to decline and evolved into a continuous loss at present. It can be seen that the results of the company's strategic transformation have fallen short of expectations. From 2019 to 2022, Yuanwang Technology achieved revenue of 2.07 billion yuan, 2.151 billion yuan, 2,811 billion yuan, and 3,901 billion yuan respectively. Net profit for the same period was 150 million yuan, 24.2978 million yuan, -700 million yuan, and -265 million yuan respectively.
The reason behind successive losses in performance is related to the large impairment of goodwill accumulated by the company. From 2021 to 2022, Yuanwang Technology prepared for impairment of the goodwill formed from the acquisition of Fashion Fengxun and Beijing Shixin for two consecutive years. By the end of 2022, it had accrued 171 million yuan and 798.505 million yuan respectively, accounting for 60.76% and 99.94% of their original goodwill value, respectively.
As of the end of September 2023, Yuanwang Technology's reputation was 1.42 billion yuan. Among them, the 1,302 billion yuan goodwill formed by the company's acquisition of Hangzhou Yuanwang has yet to be depreciated. Yuanwang Technology has previously stated that if the business conditions of Yuanwang Network, Fashion Fengxun, and Beijing Shixin fall short of expectations, there will be a risk of impairment of related goodwill, which will have a significant adverse impact on the company's business performance.
It is worth mentioning that in December 2023, Yuanwang Technology received a regulatory letter and warning letter from the Guangdong Securities Regulatory Bureau due to two years of inflated revenue and profits and credit disclosure violations.
A CFA reporter noticed that in 2023, there are also highlights in Yuanwang Technology's management. For example, during the Double Eleven period last year, the company achieved a total GMV of over 3.29 billion, an increase of 38% over the previous year (the statistical period was 10.1-11.11), the total number of orders reached 15.38 million, and the total market view reached 680 million, breaking 6 million in a single day. Yuanwang Technology said that in the future, the company will continue to invest a lot of energy in building a matrix of stars and talents to further expand its influence in the industry.