Busen Shares Deep In Debt Disputes Net Profit For Two Years Will Be Wearing Star Cap

In January 15, 2019, Zhejiang Busen apparel Limited by Share Ltd (hereinafter referred to as Busen shares) issued the "2018 annual performance revision notice". In 2018, the three quarterly report estimated that the net profit of -200 in 2018 was ~500 million yuan, an increase of 94.08%~114.79% over the same period last year.

The net profit after the amendment is 185 million yuan ~1.98 billion yuan.

The reasons for the amendment include "the corresponding projected liabilities for the litigation", "adjusting the inventory handling policy and the dealer return system".

Two years net profit is negative, will "cap" acquisition to strategic investment.

The main business of Busen shares is the design, production and sale of men's brand clothing. The main target group is 25~45 year old business man. The company's products include men's shirts, Western-style clothes, trousers and jackets, T-Shirts, professional wear and so on.

In the face of increasingly competitive market environment, the performance of Busen shares has declined.

In 2016, 2017 and 2018 1-9, Busen shares achieved 370 million yuan, 344 million yuan and 311 million yuan respectively, achieving net profit of 6 million 599 thousand and 600 yuan, -3380.7 million yuan and -556.19 million yuan respectively.

According to the 2018 annual performance notice amendment notice, the net profit for the whole year in 2018 was a loss of 185 million yuan ~1.98 billion, and the net profit of the company in 2017 and 2018 was negative for two consecutive years.

According to the relevant regulations, "the net profit of audited net profit in the last two fiscal years has been negative for a long time or the net profit in the last two accounting years has been continuously negative due to retrospective restatement".

Busen shares will be "wear cap" after the 2018 annual report is officially disclosed.

According to Shen Wan's tertiary industry classification, we choose Hai Lan's home and red bean stock as comparable companies. After comparison, we find that the proportion of management fees and sales expenses of Busen shares is far higher than that of the same industry.

In 2016, 2017 and 2018 1-9, Busen shares accounted for 17.5%, 18.54% and 12.34% of total sales revenue respectively.

The total operating expenses in the same period accounted for 13.1%, 14.52% and 11.62% respectively.

The excessive sales and management costs have eroded the company's net profit and Busen's net profit margin has continued to decline.

In June 15, 2018, Busen shares intends to acquire Beijing Mccauley Technology Co., Ltd. (hereinafter referred to as "Mccauley"). With the help of Mccauley's rich management experience in the retail field and the accumulation of technology in the scene sales, the company will sink the new retail outlets of various fashion industries to the store, so that the retail business and the retail terminal can achieve better integration and docking, so as to achieve the goal of optimizing the company's industrial structure and focusing on strategic positioning.

Mccauley is one of the largest chain of communication products in China. With rich experience in chain operation and advanced management mode, it has reached strategic partnership with telecom operators and major brand mobile phone operators.

At the beginning of 2017, it signed a strategic cooperation agreement with Jingdong, operated Jingdong's home and Jingdong store project, implemented the theory of "unbounded retail" of the fourth retail revolution, built a new storefront, and built intelligent, diversified entertainment and entertainment scenes through new technologies, new products, new props and new services, aiming to enhance customer shopping experience.

At present, the new business model, which is based on the concept of "Jingdong's unbounded retail", has been initially established, with the support of "wholesale + retail" and "Online + offline".

Half a year after the purchase, it was broken down, because "the audit cycle is longer, and there is greater uncertainty. It can not improve the layout of the listed companies in the new retail and new finance and distribution field" in the short term, and terminate the acquisition, instead of buying the stock rights of Mccauley 10% with cash 20 million yuan.

Deep into debt dispute 236 million into whose pocket?

At the same time, Busen shares were deeply involved in the dispute of loans. However, from June 2018 to the end of October, the company had a loan dispute with the debit Bank of Deqing County small and Medium Enterprises Financial Services Center Limited, Zhu Dandan and Shenzhen Xin Rong financial Cci Capital Ltd. The amount involved was 137 million 500 thousand yuan, 49 million 660 thousand yuan and 48 million 740 thousand yuan respectively, amounting to 236 million yuan.

The above debtor has filed a lawsuit against the company, and the loan dispute has been accepted by the people's courts.

In October 27, 2017, Busen group, the Limited by Share Ltd of Tianma bearing group under the control of Xu Maodong (hereinafter referred to as "*ST Tianma (Wei Quan)") signed the "loan guarantee contract" with the Deqing County small and medium enterprises financial service center limited. The Tianma bearing group Limited by Share Ltd borrowed 100 million yuan from the Deqing County small and medium enterprises financial service center limited company, and the loan period was from October 27, 2017 to December 26, 2017. The lending rate was agreed to be 18%.

According to the loan guarantee contract, Kashi Xinghe Venture Capital Co., Ltd., Zhejiang Busen dress Limited by Share Ltd, Beijing Xinghe World Group Co., Ltd., Xinghe Internet Group Co., Ltd., Huoerguosi food and investment venture limited company, Xu Maodong provide joint and several liability guarantee.

Zhu Dandan and Beijing Xinghe World Group Co., Ltd., Tianma bearing group Limited by Share Ltd, Zhejiang Busen apparel Limited by Share Ltd, Xinghe Internet Group Co., Ltd., Kashi Xinghe Venture Capital Co., Ltd., Huoerguosi food and investment venture limited company, Xu Mao Dong, sun ginkgo tree equity investment fund (limited partnership), Fu Miao signed the "highest loan contract", agreed between August 25, 2017 and August 25, 2018, the defendant jointly applied to the plaintiff to borrow money within the maximum loan amount range of 70 million yuan.

According to Zhu Dandan's electronic bank receipt, in September 29, 2017 and December 19, 2017, the plaintiff imported 10 million yuan and 35 million yuan to Beijing Xinghe World Group Co., Ltd., respectively.

In August 25, 2017, Shenzhen Xin Rong wealth Cci Capital Ltd, through its "Shun Rong fortune" website platform, matched the online lenders with the Lhasa star burning Enterprise Management Co., Ltd., Xinghe Internet Group Co., Ltd., Huoerguosi Venture Capital Co., Ltd., Beijing Xinghe win Technology Co., Ltd., Kashi Xinghe venture capital Co., Ltd. and Huoerguosi Yue Le Tao Venture Investment Co., Ltd. signed the loan contract.

In August 28, 2018, the online lender borrowed 48 million 780 thousand yuan loan from the respondent and failed to repay the loan after maturity. Busen shares were jointly and severally liable for the loan.

But the main management of Busen shares, such as the legal representative, did not know the existence of this external guarantee. The company did not receive any loan funds from Deqing small and medium enterprises, Zhu Dandan and Xin Rong wealth.

At present, the company is unable to determine whether the "Busen stock" seal in the warranty document is a statutory seal of the company. It does not exclude the fact that someone has forged the company's official seal and imposed the name of the company.

In response to the above situation, the company has reported to the Zhuji Public Security Bureau Maple Bridge police station, and reported to the public security organ for investigation and investigation on the above alleged criminal acts such as forging company seals and making documents privately.

It is worth noting that all the disputes occurred during Xu Maodong's actual controller of Busen shares.

Xu Maodong is not unfamiliar with many people. He is the helmsman of the "Star River" capital empire.

In August 17, 2016, Busen shares announced that the Xinghe group's Xinghe win and Lhasa Xingxing will spend 1 billion 12 million yuan to share the 95.02% stake in Shanghai Rui Wei, a controlling shareholder of Busen shares. After the completion of the paction, its assets remain the largest shareholder of Busen shares, accounting for 29.86% of Busen shares.

Xu Maodong, the general partner of Xinghe win as an asset, has become the actual controller of the listed company.

According to the sky eye, the ultimate beneficiary of the above *ST Tianma and other borrowers is Xu Maodong.

In addition, in the debt dispute between the above-mentioned *ST Tianma and Deqing County small and medium enterprises financial service center limited, the announcement of *ST Tianma announced that the company's board of directors and shareholders' meeting had not considered the matters related to lending with Deqing County Financial Services Center Limited.

In addition, *ST Tianma is not aware of many debts.

It is worth mentioning that because the company and Mr. Xu Maodong suspected of violating the PRC Securities Law and other relevant laws and regulations, according to the relevant provisions of the securities law of the People's Republic of China, the China Securities Regulatory Commission decided to file a case investigation for the company and Mr. Xu Maodong.

In February 12, 2019, Busen shares received the notice of "civil judgment". *ST Tianma needed to repay the loan amount of 76 million 820 thousand yuan from Deqing County small and medium enterprises financial service center limited and 18 million 369 thousand and 300 yuan of the overdue payment default, and from December 12, 2018 to the actual settlement date, with a loan principal of 76 million 820 thousand yuan, 24% years interest rate was paid for breach of contract damages, Busen shares were jointly liable for the debts that could not repay part of the debts, and after assuming the liability for compensation, they had the right to recover *ST Tianma.

In February 22, 2019, Busen shares received the "civil ruling". The people's Court of Shangcheng District of Hangzhou has examined that the defendant's Busen shares believe that the official seal of Zhejiang Busen clothing Limited by Share Ltd, which was stamped on the loan contract of this case, was forged by others and dismissed the prosecution of plaintiff Zhu Dan Dan.