Repurchase lost trust, the performance plummeted Dong A gum dilemma to be solved.

Pharmaceutical Network, June 23rd, the East A-A-Gum Co., Ltd(hereinafter referred to as "East A-Gum") announced that in order to better play the largest role of funds in the production and operation, the termination of the repurchase of the company's sharesThis has sparked a market uproar and its reputation has been questioned again.Terminating the repurchase, alleged and untrustworthy
as early as May 24 last year, Dong'a gum threw out a repurchase plan, with a plan to buy back the shares issued by the company by means of a centralized bidding transaction with its own funds of not less than 750 million yuan and no more than 1.5 billion yuanThe repurchase price shall not exceed 45 yuan/share, and the term of the repurchase shall not exceed 12 months from the date of the approval of the shareholders' meeting, and the repurchase of shares shall be used for subsequent employee shareholding plans or equity incentive plans.However, on June 12, Dong'a gum announced the termination of the repurchase of the company's sharesDong'a gum explained that due to the impact of the new crown pneumonia outbreak, combined with the actual operating situation of the company, in order to better play the maximum role of funds in production and operation, in order to strive for better performance for shareholders to create greater value, after careful consideration of the decision to terminate the repurchase of the company's shares.It is reported that as of the same day (June 12), Dong'a gum through the repurchase of special securities account simply by centralized bidding transaction selling of 10,044,713 shares, accounting for 1.54% of the company's total share capital, of which the highest transaction price of 40.11 yuan / share, the lowest transaction price of 30.78 yuan / share, the total amount paid is RMB 349,823,302.72 million (about 3.5 billion yuan).According to the lower limit of 750 million yuan, dong'a gum at least 400 million yuan of repurchase amount was not completed, the completion rate of less than 50%This termination of the repurchase announcement, triggered a market uproar, investors angrily denounced its words and no faith, said that "should increase the repurchase of the penalties for breach of trust", more netizens said "millennial brand destroyed in the present.".　　The performance plummeted, or has long been "buried" East A gum under the China Resources Group, is a gum series of products production enterprises, is the country's largest manufacturer of A-glue It was built in 1952 and listed on the Shenzhen Stock Exchange in 1996 For a long time, because of its performance of the stock repeatedly record high, once the industry was called "the drug Maotai." .　　However, Dong'agum, known for its high growth, suffered its first loss since the listing this year According to the annual report, the company achieved revenue of RMB2,958,622,339.62 in 2019, down 59.68% YoY, while net profit attributable to shareholders of listed companies lost RMB443,915,811.52, down 121.29% YoY In the first quarter of 2020, the Company achieved revenue of RMB437,737,253.85, down 66.11% YoY, and net profit attributable to shareholders of listed companies was RMB83,867,522.88, down 121.33% YoY .　　The fog of plummeting performance has not yet been dispelled, and on June 12th Dong'a gum announced the end of the repurchase of the company's shares The performance plummeted, the buy-back lost faith, Dong'a gum once again into the dilemma .　　In fact, it is not surprising that Dong'a gum is in a difficult position Industry insiders believe that one of the important reasons for the collapse in the performance of Dong'a gum is the price increase - successive price increases led consumers to stop buying, relying on price increases to support the growth logic encountered the "ceiling" .　　According to media reports, in 2006, Qin Yufeng became the general manager of Dong'a gum, then held high the banner of cultural marketing, to open the "value return" strategy With the name of donkey skin shortage and "value return", Dong'a gum embarked on a crazy road to raise prices According to Zhejiang Securities statistics, the East Agum a gum block 2005-2019, has been accumulatively raised 18 times, the price increased 20 times Between 2006 and 2018, the company's operating income also rose from 1.1 billion yuan to 7.3 billion yuan, and the net profit of the parent company rose from 150 million yuan to 2.1 billion yuan . However, it is worth noting that when price increases and high performance growth, its operating efficiency is not optimistic - net profit growth is on a downward trend Data show that in 2014-2019, the net profit of Dong'a gum increased by 13.52%, 19%, 14%, 10.36%, 1.98% and -121.29%, respectively . the other side of the high-speed growth of Dong'a gum performance is the bottleneck of the development brought about by dealer hoarding This phenomenon is also confirmed in the annual report At the end of 2019, its inventory amounted to RMB3,521,670,204.89, representing 30.22% of total assets, and at the beginning of 2019, the inventory amounted to RMB3,366,887,212.23, representing 24.27% of total assets Recently, the Securities Times has reported that the 2019 performance of Dong'a Gum decline, the reason is that the East A-A gum channel inventory continued to be overstocked, resulting in a decline in revenue, directly affecting operating performance .　　On top of that, the other side of high-performance growth is that its original market is also "hands-off" Under the guidance of "value regression", the goal of East Agum to enter the high-end market is gradually clear, and this has to divert its original market According to Phoenix.com, before 2012, Dong'a gum occupied 80% of the market share of the Agum market, and was the dominant industry leader But in 2016, the market share of Dong'a gum fell to 32%, and the price is only half of the East Agum Fu brand A gum, the market share exceeds the East A gum, reached 34.81%, in addition, Tongrentang, Jiuzhitang and other large pharmaceutical Group is also in pursuit .　　False propaganda, exposed mismanagement
If the collapse in performance can be attributed to poor management, then illegality is mismanagement East Agum performance behind, or can not be separated from its "marketing." Economic Daily-China Economic Network reporter found on credit China's official website that Dong'a gu was punished by the Hangzhou Municipal Market Supervision Bureau in 2017 for false propaganda The period 2016 to 2017 was also the best time for Dong'a gum efficiency, with net profitofed 1,852 million yuan and 2,044 million yuan .　　Unusually, management loopholes go far beyond false propaganda According to the State Enterprise credit information publicity system, July 04, 2018, Chongyang County Bureau of Industry and Commerce to its administrative punishment, the amount of 150,000 yuan, the reason is not public .　　According to China's report hall network, in 2017 China's A-glue industry market size of 39.5 billion yuan, is expected to 2020, China's A gum industry market size will reach 56 billion yuan With the consumer's respect for the concept of health
and wellness, the competition in the a-gum market is becoming more and more intense .　　2019 is a watershed year for The East Agum and the entire A-Gum industry Reporters noted that in 2019, the accounts receivable of Dong'a gum amounted to 1,263,014,299.85 yuan, an increase of 4.33% yoY, Dong'a gum explained that due to the external environment, downstream customer capital pressure increased, the return decreased On the other hand, in 2019, the amount of bad debt provision for the East Agu stakes amounted to RMB191,140,277.22 (2018 was RMB59,890,191.31), and the amount of bad debt provision for recovery or recoup amounted to RMB47,162,859.57 (2018 was RMB17,914,117.19) .