Goodwill Impairment Tide Hits: Many Listed Companies "Performance Change Face" 1 Trillion And 390 Billion Yuan Goodwill To Digest

On the evening of January 14th, Beidou Tong, which caused a great stir in the A share market due to a huge "advance loss", received the letter of concern from the Shenzhen Stock Exchange. The Shenzhen Stock Exchange asked Beidou star to disclose the details, the estimated amount and the reasons for the large asset impairment provision.

Prior to that, Beidou star disclosed in the 2019 annual performance notice that the net profit in 2019 is estimated to be -6.5 billion yuan to -5.5 billion yuan. The reason for the sharp decline in net profit is mainly the total assets impairment of 653 million yuan, including 530 million yuan for goodwill impairment.

This is just the corner of A share goodwill explosion.

In the near future, more and more performance notices are reported to be "reported bad" in the near year "report card". Goodwill impairment is rising again. Tomson times, Cixing shares, Donghua software, star network, Yuda and so on have announced large assets impairment, and the annual report performance in 2019 has been seriously affected.

"Overall, the performance commitment of the acquired target is not up to expectations, and the decline in performance after the commitment period is the main reason for the formation of the goodwill impairment of the listed companies. We predict that the risk of goodwill impairment of A share listed companies in 2019 will be lower than that of 2018, but the risk of" exploding thunder "risks of individual listed companies still need to be vigilant. In January 14th, a strategist from a medium-sized brokerage in Shanghai was interviewed.

Listed companies have introduced impairment in succession.

Wind data showed that as of January 14th, 759 listed companies had announced the results in 2019, of which 93 listed companies were pre paid, 129 companies were losing money, and the total number of listed companies that reported "bad news" accounted for nearly 30%. In addition, there are 97 listed companies whose performance is uncertain.

In the listed companies with poor performance, the loss of assets impairment, including the loss of goodwill impairment caused by extension merger and acquisition, is an important factor.

On the last day of 2019, the health care product leader suddenly stepped down "giant thunder". He announced that it was expected to total 1 billion 540 million yuan to 1 billion 640 million yuan for the preparation of goodwill impairment and the impairment of intangible assets for the acquisition of LSG, and it was expected that the loss would be 365 million yuan to 370 million yuan in 2019, which was the first loss in ten years.

Prior to that, in 2017 and 2018, he maintained a net profit growth rate of more than 30%, and was regarded as the representative enterprise of A share market value investment. In 2019, 127 institutions went to the listed company to investigate and research, up to 165 people.

All the changes came in August 2018, when he bought a huge sum of LSG from Australia's Probiotic company, which is 3 billion 514 million times the premium and 34 times the premium. After the acquisition, Mr Tang formed 2 billion 238 million goodwill assets and 1 billion 612 million yuan intangible assets at the end of the three quarter of 2019, accounting for 67.5% of the total net assets of that time.

But only a year after the acquisition, LSG company's employment performance has changed greatly, and the LSG company failed to achieve its performance expectations.

Data show that when he purchased the LSG assessment, he predicted that the expected revenue in 2019 would be 189 million Australian dollars, with a forecast growth rate of 27.26%. In 2019, the actual data showed that LSG's real income was only 82 million Australian dollars, down 43.84% compared with the same period last year, and its real income was less than half of the forecast value.

In January 11th, the Beidou star, with multiple concepts such as "chip + HUAWEI + military industry", also staged the same scenario, announces the "performance deficit", and the loss in 2019 exceeded the profit of the past ten years.

Since 2015, the Big Dipper has carried out a series of industrial mergers and acquisitions around "Beidou +". Among them, in 2015, through the issue of shares to buy assets purchased Huaxin antenna and Jiaxing Jiali; in 2016, bought Dongguan Yun Tong, Guangdong Wei Tong; in 2017, bought Hangzhou Kaili, Germany In-Tech and Canada Rx and other companies.

Subsequently, the revenue and profits of the Big Dipper increased rapidly, but the crisis also lurked. In 2018, the net profit of the Big Dipper was already -4.24 billion yuan.

By 2019, due to the constant international trade frictions, the downward pressure on domestic economy, the uncertainty of market demand and the difficulty of some customers' operations, Beidou Xing Tong predicted that the total impairment of goodwill would be around 530 million yuan, involving 6 asset groups.

In addition, Cixing shares also announced a loss of 720 million to 725 million yuan in 2019. It is estimated that there will be about 600 million yuan in goodwill and intangible assets impairment in the early acquisition of Hangzhou excellent investment Technology Co., Ltd. and Hangzhou Polye Network Technology Co., Ltd.

Donghua software expects to achieve net profit of 600 million -7 billion yuan in 2019, down by 13%-26% compared with the same period. It is estimated that the amount of goodwill impairment provision will be 300 million -4 billion.

"At present, we recommend avoiding the attitude towards the stocks with high goodwill in the net assets. The peak period of M & A is mainly in 2014-2016 years. The risk has been released more fully in the past two years, but there is still a higher stock goodwill risk in some growth sectors to be digested." The analyst pointed out.

Can you travel lightly?

It is worth mentioning that many of the listed companies that were dragged down by goodwill had no obvious fluctuations in their share price after the "exploding thunder".

Donghua's software has risen by 8.41% since January. Since January, the number of software has increased by 22.87%. Many market participants pointed out that after the impairment of large goodwill, the listed companies were able to "light up the battle array" in the coming year, and the growth of their performance could be expected.

"Impairment of goodwill test is a very large operation space, because the evaluation of enterprise value is difficult to judge. There is a possibility that the enterprise will make a one-time expenditure of potential expenses and call it "goodwill impairment". In the coming year, as long as there is a slight improvement, earnings will increase significantly, especially for light assets companies. An accountant from a Southern China accounting firm pointed out to reporters.

Then, in 2018, did the listed companies with large assets impairment losses really get rid of the burden and "regain new life"?

In twenty-first Century, the economic news reporter noted that among the listed companies that had disclosed the 2019 earnings forecast, 86 listed companies were expected to turn around, and there were many stocks that were "big baths" in 2018.

For example, in 2018, a loss of 1 billion 495 million asset impairment was introduced, which eventually led to a huge loss of 1 billion 692 million yuan in orfei entertainment. It turned gorgeous. In 2019, it was expected to make a profit of 130 million yuan to 150 million yuan, an increase of 107.97% to 109.20%. In 2018, the western mining industry with a huge deficit of 1 billion 814 million yuan was expected to gain about 1 billion yuan in 2019, an increase of 148.47%.

However, not all listed companies can "turn the tables". The number of listed companies expected to continue losses in 2019 is also as high as 55. In 2018, the loss of Wang Shen Shen entertainment is still in deep mire of losses. After losing 6 billion 978 million yuan in 2018, 2019 is expected to add a deficit of 850 million -10.5 billion yuan.

"After the outbreak of goodwill impairment risk, the trend of stock price depends on the fundamentals of the listed company and whether the expected performance trend of the market is improved, which requires investors to screen out the enterprises whose fundamentals have already had significant problems." The analyst pointed out.

According to Wind data, at the end of the three quarter of 2019, the total scale of goodwill of A share listed companies reached 1 trillion and 390 billion yuan, roughly the same as the same period in 2018, which is only 74 billion 600 million yuan higher than the end of 2018. The total goodwill accounts for 3.11% of the total net assets of the two listed companies, which is 0.1 percentage points lower than that of 3.21% at the end of 2018.

However, on the whole, market participants generally believe that the risk of goodwill impairment in 2019 is better than that in 2018.

GF Securities strategist Dai Kang pointed out that the 2018 annual report A shares goodwill impairment hit a record high, causing great concern in the market. The reason is that the market is likely to ignore the impact of the policy except the performance commitment maturity pressure and the economic downturn, and is expected to overlook the impact of the policy in 2019.

"The goodwill of listed companies is under the pressure of endogenous and exogenous double impairment. Comparing the location and trend of the relevant factors at the end of 2019, we conclude that the goodwill of each sector of the 2019 annual report needs to be further digested, but the pressure and risk is less than that of 2018." Dai Kang further pointed out.