The ruin of the first share of garden: Oriental Garden for five consecutive years the operating cash flow is negative

Oriental Garden, the first Chinese garden greening is slowly down the "altar." In the first quarter of 2014, the Oriental Garden realized revenue of 536 million yuan, net profit fell 432.48%, and the loss amounted to 74 million yuan. In fact, since 2009, since the listing of the SME, Oriental Garden has achieved rapid development, but was once leaped into the "first high price stocks." But because the Oriental garden project mainly originates from the municipal garden construction and takes the enterprise upfront advance the project model, its cash flow has been tight. As of March 31, 2014, Oriental Garden recorded a negative operating cash flow of 179 million yuan, which is the fifth year since the listing of operating cash flow in the net outflow state, from 2009 to 2013 the value of 114 million yuan,-259 million yuan,-396 million yuan,- 251 million yuan and 263 million yuan. It is noteworthy that the Oriental Garden accounts receivable and inventory has been high, as of the first quarter of this year, its inventory has been as high as 4.921 billion yuan, accounts receivable also reached 3.065 billion yuan. The difficult situation, the local debt audit launched by the Audit Commission at the end of last July, the local fiscal tightening background, it is particularly grim. In this respect, Oriental Garden introduced the "financial security Model", and the seed, ecological business as the next development focus. At the end of 2012, Oriental Garden put forward the strategy of "seedling networking" by using Internet, IoT of things and electronic commerce technology, and hired the Guo Zhaohui as vice president of Amazon China, CEO of the Royal Nutshell, and the general manager of the Department of Landscape Gardening. But the Times weekly reporter found that on the March 12 of this year on the line of the seedlings of the majority of the number of seed procurement, and daily average page view is only 900, the site average of 4,025,844. In addition, it is particularly noteworthy that the 2013 annual report of the Oriental Garden showed that during the reporting period, its stock sales were 56.08%, and the sales were only 294,200 yuan; compared with the same industry, Palm Garden, the same period of stock sales of 97.945 million yuan, gross profit margin of 51.27%. In view of this, the development of Oriental Garden's seed business still has a long way to go. Five years of operating cash flow for the first half of this year, Oriental Garden ushered in the most dismal performance since the listing. According to its 2014 quarterly report, the reporting period, the Oriental garden to achieve revenue of 536 million yuan, attributable to the owner of the listed company net profit loss of 74 million yuan, the year-on-year decline of up to 432.48%. In this respect, Oriental Garden explained that the main reason for the sharp decline in performance is due to seasonal factors such as the Spring Festival and Climate, the company's northern project is basically in the construction preparation stage, few days of construction, resulting in a small amount of garden project revenue; In addition, the company to cultivate new business growth, Increased the stock business and the early investment in ecological business, 2014 years a quarter of more than 40 million. For this explanation, the market does not seem to buy, in the first quarter results announced the day, Oriental Garden shares plunged 9.77%.In fact, with the green environmental protection, the aura of Sunrise Industry, Oriental Garden since the listing, along with a large single sign and market valuation all the way together, once boarded the two cities "the first high price shares" of the throne. Only in the second year of the listing, the Oriental Garden has realized the growth rate of operating income and profit compound, up to 149% and 208% respectively. But behind the high development and the high profit financial data, the Oriental Garden's operating cash flow is the long-term income, the fund shortage has already become the Eastern garden chronic disease. As of March 31, 2014, Oriental Garden recorded a negative operating cash flow of 179 million yuan. At the end of 2013, Oriental Garden operating cash flow is-263 million yuan, this is the Oriental garden since the 2009 listing, the fifth consecutive year of operating cash flow in the net outflow state, 2009 This value is-114 million yuan, 2010 to-259 million yuan, 2011 for-396 million yuan, 2012 is 251 million yuan. One side is the continuous outflow of cash, the other side is inventory and accounts receivable multiplied. 2008 the end of the Oriental Garden Inventory of only 95.8851 million yuan, as of the first quarter of this year inventory has been as high as 4.921 billion yuan, a short period of five years, its inventory growth of nearly 50 times times, with the reporting period, Oriental Garden accounts receivable also reached 3.065 billion yuan, and last year's 3.154 billion yuan difference is not. "The Municipal garden project cycle is longer, the upfront enterprise advances a large amount of funds, easy to lead to cash flow problems, and do the government's projects, it is difficult to return to the general situation of the industry." "A veteran of the landscape industry to the Times weekly reporter analysis, he said that the continuous outflow of cash, which means that the Oriental garden must rely on more external financing to maintain higher growth," but only by financing does not solve the essence of the problem, once the money is a problem, tight capital chain, resulting in falling stock prices, refinancing difficulties, May cause the capital chain to break ". According to statistics, Oriental Garden has been listed through external financing total reached 8.38 billion yuan, of which, 35亿来 from commercial credit, 20.4亿来 loan from the bank. Times weekly reporter found that last March, due to the pressure of the capital chain, Oriental Garden Chairman He Chao will hold about 9.6 million shares of restricted shares pledged to the million win Asset Management Co., Ltd., and 9.16 million shares of restricted shares pledged to huaxin International trust. At that time, Oriental Garden issued a notice that the He Chao has accumulated a total of 95.8754 million shares of Oriental Garden Holdings, accounting for 59.15% of its shares, accounting for 31.82% of the company's total equity. "BT" mode under local debt audit in fact, the pain of cash flow is most of the garden greening companies in particular to undertake municipal garden project enterprises can not evade, and the source of its project operation of the "BT model" has become the capital chain negative cycle of the origin. BT is the English build (construction) and Transfer (transfer) abbreviated form, meaning that "construction-transfer", is the government to use non-governmental funds to carry out the basic non-operational facilities construction project a financing model。 Take the BT model of the project often need to advance a large amount of funds, the project completed after the settlement, and therefore also lead to a long period of money back. Oriental Garden in its 2013 annual report pointed out that the company's main business income mainly from the landscaping project construction and landscape design, municipal garden revenue accounted for the proportion of operating income of 91.09%, 2012 the proportion of 88.55%, municipal garden is still the core business of the company, and to maintain the trend of rising every year. "The main collection mode of the municipal garden Works is ' 5:3:2 ' mode, that is, when the project is completed, 50% works are received, and the remaining 30% works are received within one year after completion, and the final 20% is charged two years after completion." "Wuhan Planning Bureau, a design staff told The Times weekly reporter." Oriental Garden has mentioned in the annual report, the current company's municipal garden project collection mode to "6:2:2", "7:2:1" or even "8:1:1" mainly. From the open information given by Oriental Gardens, the main projects to undertake are from all levels of local government, in 2013, it undertook five Lake Park in Nanning, Shenyang North-south axis and other domestic large-scale urban landscape system projects. Although Oriental Garden says "Local government has a higher credit rating and generally has little risk of default", it is intriguing that local governments have the most arrears and the longest arrears. According to the 2013 annual report of the Oriental Garden, Datong City Garden Authority owed up to 361 million yuan, arrears of time in three years, other accounts receivable in the amount of the top five units: Yingkou Coastal Development and Construction Co., Ltd., Shenyang Valiant New Town Investment Management Co., Ltd. Jinzhou World Park Construction Management Co., Ltd. and Yantai Laishan District City Administrative area, the amount is 400 million yuan to nearly 200 million yuan, the time is within two years, and the above five customers have state-funded background. Under the model of advance payment, the local debt audit launched by the Audit Office at the end of last July made local fiscal tightening, and the problem of Oriental garden was becoming more and more obvious. Oriental Gardens seem to be aware of this problem, in its 2013 annual report, said the company has always put the issue of the money back as one of the focus of the work, and expressed the impact of local government debt pressure, in order to further reduce the risk of receivables recovery, in the second half of 2013 the company launched a financial security June 9, 2014, Oriental Garden and Huzhou wuxing Construction Investment Co., Ltd. (hereinafter referred to as "wuxing"), the Sino-Financial Trust Limited (hereinafter referred to as "Sino-Finance Trust") completed the "Financial guarantee of East New Town, Huzhou City, the core area of the eco-landscape construction of the cooperation Agreement" signed, The total contract amount is 179 million yuan, and the construction period is tentatively 2013 to 2015. Sino-Financial Trust to set up a property trust to the wuxing to provide no more than 200 million yuan of trust financing, wuxing commitment financing will be given priority to pay for the Oriental Garden project funds. 10 days later, Oriental Garden and Jilin City Construction Holding Group Co., Ltd., China Minsheng Trust Co., Ltd. completed the "financial security Jilin beautiful Jilin Eco-strategic implementation of cooperation framework Agreement" signedUNDP。 "The introduction of the financial security model in the Municipal Garden project is a winning choice, which solves the problem of financing for the local government City investment company, on the other hand, it guarantees the return of the Oriental Garden." "For the Oriental Garden in response to the difficulties of the solution proposed," CIC consultant Research director Guofan. For accounts receivable and other series of questions, The Times weekly reporter Contact Oriental Garden Dong Li Donghui, but said the company will disclose the report, the current inconvenience audible. Seedling Resources Electric business platform is still to be inspected or in view of this, in the improvement of the company's industrial chain demand and seedling industry 60% of high gross margin temptation, Oriental garden in late 2012 put forward the use of the Internet, things networking, E-commerce technology to create "seedling networking" strategy. Oriental Garden for the Miao network is "down the drain", paid to hire a former Amazon China vice president, CEO of the Royal Shell, such as the Guo Zhaohui as vice President of Oriental Garden, nursery Stock Division general manager. This April, Oriental Garden also issued a notice said, in order to further implement the seedling development strategy, to invest in Beijing to set up a wholly owned subsidiary, the name is tentatively "Beijing Miao Networking Technology Co., Ltd.". The Company intends to fund its own assets (cash or physical assets) for 1 billion yuan (three years in instalments), accounting for 100% of the registered capital. For seedling networking, Miao Network CEO Donze has been optimistic that will be the seedling network to build the first network of Chinese nursery stock, and said "Miao Network is the first to provide stock trading services vertical Web site, but also the first domestic use of O2O model to achieve stock trading platform for E-commerce." The emergence of the seedling network will bring the user a different experience. He Chao is bold to say, "future seedlings networking to do nursery stock industry ' Alibaba '". But the Times weekly reporter found that March 12, 2014 officially on the line of the seedlings online popularity but not the imagination of the hot. Click to open the "I want to sell seedlings," a column, then appeared the purchase of the sale of Miao information, most of the seed procurement is very few, or even 0 of the number of seed sales. And in 51 pages (20 products per page) of the Miao products in only six pages and half of the purchase volume of goods in more than 1000 strains. In the Alexa China website (the Alexa Chinese ranking official data query, website visits) on the average monthly 4,025,844, daily average page view (estimated) 900, and Alibaba average monthly ranking is 70, daily average page view (estimated) is 326 million. In this respect, the Times weekly reporter call Oriental Garden Dong Office, it said that the current seedling network specific volume and other data is not convenient to disclose, the site is in the promotion period, and is the company's future focus on the direction of development. In fact, although vigorously promoted, but the current Oriental garden nursery stock business is still in the initial stage of development. According to the 2013 annual report of the Oriental Garden, the reporting period, its seedlings sales of gross profit of 56.08%, sales of only 294,200 yuan, while the same industry palm garden, the same period of its stock sales income of 97.945 million yuan, gross profit margin of 51.27%. So, can the seedling network play a stimulating role in the sales of Oriental garden seedlings? "Seedling networking can make the purchase cost of Oriental gardens better controlled, and the complete commercial ecology of seedling networking can bring another profit growth point for Oriental Gardens." But because of the Oriental garden as a landscaping company, now involved in the Internet, can not perfect running-in is also worth quiet. In this regard, Guofan.