The annual reports have been lost frequently and the nuclear number has been frequently replaced. Can Bojun education turn over?

Picture source: Oriental IC

Recently, Bojun Education announced that Zhonghui Anta took over as Daxin Liang Xuezheng to become the company's nuclear division. This is the second time the company replaced the nuclear division within a month.

As of now, Bojun Education has not released the fiscal year of 2021 and the mid -term performance of 2022, and the company's stock has been suspended for eight months. Why is this company that had been expected by the capital market, why did it fall in front of it?

The annual report is difficult to produce, and the stock is suspended so far

As of now, Bojun Education's stock has been suspended for more than eight months.

On November 30, 2021, Bojun Education announced that the company's shares will be suspended for a short period of time due to the failure to announce the annual fiscal year in fiscal 2021 on time. At that time, investors may not expect that the so -called "short -term trading" will last more than 8 months. On the same day, Hong Kong shareholders' education companies that announced their announcement of 2021 also had Tianli Education, Maple Leaf Education, and Chengshi Education. Tianli Education and Chengshi Education have now resumed transactions. The mid -term performance of fiscal year suspended trading again.

It is speculated from other public information that the performance of Bojun Education 2021 is not optimistic. On February 21, Bojun Education issued a profit warning. It is expected that the company will lose about 180 million yuan to 2.50 million yuan in fiscal 2021. Compared with the profit of 15.2 million yuan in fiscal year in fiscal 2020, it is profitable from profit.

In addition to losses, Bojun Education is also entangled in the quagmire of 51%of the equity of Pengzhou School. According to the agreement, the investment funds that should have been returned before December 30, 2021 should be 41.16 million yuan. Currently, Bojun Education will only refund 1 million yuan. In May this year, the company once again entered into a supplementary agreement with Hongdeguanghua, Pengzhou School and Guarantor, saying that it would be recovered on December 30, 2022.

The crisis has not yet been resolved, but the first control group, which once helped the listing of Bojun, quietly cleared the position. In April, Shoukong Group disclosed that it sold 18.25%of Bojun Education at the cost of HK $ 62.8 million, and listed its primary and secondary school compulsory education business as "affected business". 100 million yuan. The reduction of major shareholders has further weakened the market's confidence in Bojun education.

At the end of May, Bojun Education announced that Tang Peng would take over Wang Chunguo and become the new chief financial officer. In July, Deloitte and Daxin Liang Xuezheng resigned as the Bojun Education Nuclear Euneeist. At present, Zhonghui Anta is the company's new nuclear division until the end of the next shareholders' meeting. The changes in the chief financial officer and nuclear artist have caused greater doubts about the operating performance of Bojun education. Under the delay of indefinitely, the suspension of stocks is still continuing. Section 6.04 of the "Listing Rules" of the Hong Kong Stock Exchange stipulates that if the suspension continues for a long time, and the issuer does not take appropriate action to restore its listing status, it may lead to the exchanges to remove it.

Nuclear divisions have frequently changed, major shareholders' holdings, and difficulties in transactions in related transactions ... However, they want to think that at the beginning of listing. Bojun Education was well recognized by capital. Before listing, it was released to be nearly 237 times. To the point today?

High debut, insufficient power

In the announcement of the announcement of the suspension, Bojun Education stated that the "Civil Promotion Law" had come into effect on September 1, 2021. The company has not yet reached a consensus on accounting treatment methods that affect the performance of the "Civil Promotion Law". Therefore, the release of performance was delayed.

In the profit warning, Bojun Education mentioned that the main reason for the profit and loss is that the schools and non -profit kindergartens provided by the group's compulsory education services are no longer comprehensive accounts. Is the supervision that Bojun has always mentioned is the only reason for blocking operations?

On the one hand, under the influence of the implementation of the Regulations on the Implementation of the Civil Affairs Law and the Implementation Regulations of the Preschool Education Law (Draft for Opinions), Bojun Education does face compliance pressure. The 2020 annual report shows that Bojun Education operates 13 schools in Sichuan, mainly K9 schools and kindergartens. The Implementation Regulations of the Civil Affairs Promotion Law clearly stipulate that any social organization or individual may control the implementation of private schools for compulsory education through mergers and acquisitions, agreement control and other methods, and non -profit private schools that implement preschool education.

The 2021 mid -term performance report shows that Bojun Education revenue in the first half of the fiscal year in 2021, of which was 196 million yuan, of which tuition fees accounted for more than 97%. After losing the control of its compulsory education schools and non -profit kindergartens, it will inevitably have a greater adverse effect on the performance of Bojun education.

But on the other hand, Bojun's education has fallen into the situation of Vigui and cannot blame all responsibilities on supervision. Before listing, Bojun Education's price -earnings ratio was significantly higher than old -fashioned private education companies such as Maple Leaf and Chengshi. Once the capital market had unlimited expectations for Bojun education, but shortly after listing, the company's profitability began to decline, and his performance growth was insufficient.

In fiscal 2016-2016 fiscal year, the company's revenue rose from 135 million yuan to 376 million yuan. The bottom of the valley. In fiscal year in 2021, the company expects to change from profit to losses year -on -year, and the profitability has deteriorated again.

Accompanied by "increasing income and increasing increasing benefits" is the company's increasingly expanding ambitions. In fiscal year 2017, Bojun Education's assets are still only 701 million yuan. Only one year after listing, the 2018 fiscal 2018 has reached 1.48 billion yuan. Since then, it has increased year by year. Yuan. Among them, the growth is particularly obvious. The property, plant and equipment, from 224 million yuan in fiscal 2017 to 1.312 billion yuan in fiscal year, rose 485.71%in 4 years. In combination with the company's development trajectory, this asset increase is a significant increase in the increase in the increase in the purchase of schools.

However, at the same time, the total liability increased at high speed, from 336 million yuan in fiscal 2017 to 1.351 billion yuan in fiscal 2020. In fiscal year 2017-2017 fiscal year, short-term borrowing rose from 0 to 115 million yuan, and the asset-liability ratio rose from 47.94%to 61.23%. When the profit is tight, the company continues to expand, which will inevitably put pressure on the operation.

Recalling the first day of listing, Bojun Education closed at HK $ 2.87/share, with a market value of HK $ 2.296 billion. On the last trading day before the suspension, the closing price of Bojun's education had fallen to HK $ 0.47/share, with a market value of 80 % evaporated, leaving only 382 million Hong Kong dollars. The weak profitability pushed the stock price of Bojun Education to the quagmire, and the large -scale expansion made the company's operations risk. It can be seen that there is a problem with Bojun's education operations. The rigorous supervision has only accelerated the exposure of the problem. The company may need to "seek change" in the crisis.

Where do you go?

Delaying the publication is not a long -term solution. In order to revitalize the confidence of the market, Bojun Education is taking measures to transform.

One direction is vocational education. In September 2020, Bojun Education spent 245 million yuan to subscribe for 49%of Hongyuan Education. The company claims that Hongyuan Education indirectly has two vocational education institutions in Chengdu, and investing in Hongyuan Education to bring a good opportunity to invest in the Sichuan vocational education industry for Bojun Education. In December 2021, Bojun Education announced again that it was planned to acquire 51%of Zhengzer Education for 283 million yuan, and to acquire a total of 51%equity of high education investment for 26.01 million yuan. It is understood that both companies provide private vocational education services in Sichuan.

Vocational education is the transformation idea of ​​many private education groups in compulsory education schools. For the first time, the new "Vocational Education Law" clarifies that vocational education and ordinary education have the same important position, so the degree of freedom of private universities and high schools of high vocational colleges has further expanded. The "Civil Affairs Law" encourages enterprises to organize or participate in private schools in accordance with the law in accordance with the law, joint venture, cooperation, and other methods. Under the favorable policy, social capital participation in private vocational education may usher in a broader development space.

The other direction is to C to TO B, and the heavy asset model from high rental costs to high -efficiency and scalable light asset models. On June 1 this year, Bojun Education announced that it would provide management services to five kindergartens, including the divestituded peninsula kindergarten, from September 1, 2021 to August 31, 2022. No more than 8.35 million yuan. On July 5th, Bojun Education once again announced the establishment of a renewal agreement with the above five kindergartens. In the next three years, it will provide management services to kindergartens. Kindergartens should pay 23.5 million yuan, 23.5 million yuan and 24.4 million yuan. The cost will be settled on August 31st or before the relevant year.

FY2019 -2020 fiscal year, the tuition income of Bojun Education Operating Kindergarten was 53.514 million yuan and 33.877 million yuan, respectively. Compared with the cost of renewal agreement, the business income of Bojun Education in the preschool education sector is expected to be affected to some extent. However, the company still needs time to explore more possibilities in the business model.

In addition to Bojun Education, Chengshi Education and Guangzheng Education also transformed the light asset model after stripping the K9 business. The transformation ideas of red, yellow and blue are similar. After peeling from the domestic direct -operated kindergarten business, the subsidiaries of the red and yellow and blue counters subsequently signed a series of 15 -year service agreements. The form is income from the original VIE. But whether such a model can bring considerable income is still unknown. Judging from the current transformation results, this part of business is more "returning blood".

In addition, at the beginning of listing, Bojun Education plans to use 3%of raised funds to set up a private international school in grades 7-12 in California, USA. In the situation where domestic supervision is stricter, it is a choice that can be tried overseas.

Judging from the current transformation strategy, Bojun education is still inseparable from mergers and acquisitions, but the "grass reckless era" that has expanded scale to maintain growth has passed. In order to grow long -term and sustainable development, Bojun Education's excavation of profits inward is extremely important.

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