恩典生命科技(02112) - 2025 - 年度业绩

Grace Life Technology Holdings Limited 2024 Annual Report Supplement Announcement Measures and Current Status Addressing the 'Disclaimer of Opinion' This section outlines the company's multi-faceted strategies, encompassing business development, debt restructuring, receivables recovery, cost control, and legal petition management, to address the auditor's disclaimer of opinion and enhance financial sustainability Business Development The company has pivoted to the plant stem cell business, suspending iron ore operations, and is expanding its B2B market through outsourced production, distributor networks, new product launches, and strategic partnerships, generating new revenue and securing minor bank loans - Due to declining iron ore prices, the company has suspended its iron ore business while evaluating other revenue possibilities, such as tin concentrate as a byproduct[4] - The company is actively developing its plant stem cell business using a B2B model, outsourcing production to external factories, and has launched new products like ginseng stem cell liquor and high-fiber probiotic beverages to expand its market[5][6] - A strategic cooperation framework agreement was signed with Tianjin Bingcaogangmu in June 2024, leveraging its sales network to promote products and generating approximately $3.3 million in new revenue from this partnership during the year[6][15] - To support working capital, the company borrowed RMB 2.1 million in unsecured bank loans during the year, with annual interest rates ranging from 14.3% to 18.0%[6] Debt and Financing Status The company faces severe debt pressure, engaging in restructuring negotiations with multiple creditors, including a $60 million loan from controlling shareholder Yutian, approximately $27.7 million from a third-party merchant, about $36.8 million in bank loans (primarily OCBC), and approximately $78.2 million in overdue notes, while also facing fundraising challenges due to unfavorable market conditions Debt Overview | Debt Type | Related Party | Amount (Approx.) | Status | | :--- | :--- | :--- | :--- | | Shareholder Loan | Controlling Shareholder Yutian | $60 million | Verbally agreed not to demand repayment, but no formal agreement | | Shareholder Loan 2 | Yutian/Industrial Bank | $40 million | Loan rights assigned to Industrial Bank due to Yutian's default to Industrial Bank | | Other Borrowings | Hong Kong Merchant (Third Party) | $27.7 million (Principal & Interest) | Verbally agreed not to demand repayment, formal agreement under negotiation | | Bank Loans | OCBC Bank, etc. | $36.75 million | Defaulted, debt restructuring being handled by asset management company | | Outstanding Notes | Noteholders 1 & 2 | $78.2 million (Total) | Defaulted, restructuring negotiation being handled by asset management company | - Due to uncertain future economic growth and a high-interest rate environment, investor sentiment is cautious, posing fundraising challenges for the company, with only preliminary discussions held with potential investors[11][14] Recovery of Outstanding Trade Debts As of year-end 2024, the company's total trade receivables were approximately $224 million, with formal repayment agreements reached with two major debtors accounting for over 80% of the outstanding amount, though repayment progress is slow, prompting further negotiation for accelerated recovery Trade Receivables Summary | Item | 2024 (USD Thousands) | 2023 (USD Thousands) | | :--- | :--- | :--- | | Total Trade Receivables | 224,326 | 225,065 | | Of which: Debtor A | 111,356 | 111,468 | | Of which: Debtor B | 73,178 | 73,681 | - Formal repayment agreements have been reached with major debtors A and B, with each repaying HKD 200,000 monthly since mid-2024; the company acknowledges the current repayment plan is not optimal and will continue negotiations to accelerate recovery[16][18] Cost Control To control administrative costs, the company has implemented various measures, including optimizing staffing (reducing employees from 45 to 40), adjusting to a performance-based compensation structure, and strictly controlling non-essential expenditures - Multiple cost control measures have been implemented, including optimizing staff allocation, with total employees reduced from 45 at year-end 2023 to 40 at year-end 2024[19] - Compensation structure has been adjusted from fixed salaries to performance-based incentives, while unnecessary business travel is restricted and online meetings are encouraged[19] Petitions and Legal Status In 2021, the company proactively filed a 'light-touch' winding-up petition with the Cayman Court to facilitate debt restructuring while retaining business management; additionally, a statutory demand for approximately RMB 251 million was received, but its validity is disputed, and no winding-up proceedings have been initiated by the claimant - In June 2021, the company proactively filed a 'light-touch' winding-up petition with the Cayman Court to appoint joint provisional liquidators to assist with debt restructuring[20] - The company received a statutory demand for repayment of approximately RMB 251 million, but internal review raised doubts about its validity due to no prior business dealings with the claimant[22] - As of December 31, 2024, the company had not received any winding-up petitions or legal proceedings notices related to the aforementioned statutory demand[22] Future Plans to Address the 'Disclaimer of Opinion' (FY2025) For FY2025, the company has formulated a comprehensive resolution plan to address issues leading to the 'disclaimer of opinion,' focusing on achieving at least 20% sales growth in plant stem cell business, formalizing key debt agreements, introducing new partners for overall debt restructuring, pursuing financing opportunities, and targeting approximately 10% administrative cost savings - Business Growth: Plans to achieve no less than 20% sales growth in the plant stem cell business in FY2025 by launching new products like beauty and personal care items and adding 3-5 new distributors[24] - Debt Management: Plans to sign formal written agreements with shareholder Yutian and third-party lenders in 2025, and engage with a Beijing-based private equity fund to explore debt consolidation plans[24] - Receivables Recovery: Meetings will be held with major debtors A and B in Q4 FY2025 to negotiate methods for accelerating repayment progress[27] - Cost Savings: Aims to save approximately 10% in administrative costs in FY2025 through measures including improving labor efficiency, salary reviews, and controlling capital expenditures[27]