Sou Hu Cai Jing·2025-07-05 18:57Core Viewpoint - The resignation of He Xiuxia, the general manager of Jinzhongzi Liquor, has raised significant attention in the capital market and the liquor industry, as it reflects ongoing challenges within the company and its management structure [1][5][6] Company Management Changes - He Xiuxia has resigned from his positions as a board member and general manager due to work adjustments, returning to the headquarters of China Resources Beer [1][6] - He Xiuxia's tenure at Jinzhongzi began in July 2022, aiming to leverage his experience from China Resources to improve the company's performance, but he faced significant internal management issues [3][6] - The departure of He Xiuxia is seen as a potential compromise between China Resources and local government shareholders, as his reform measures may have disrupted existing interests [5] Financial Performance - Jinzhongzi Liquor has struggled with financial performance, reporting revenues of approximately 1.186 billion yuan in 2022 and 1.469 billion yuan in 2023, with continued losses of 187 million yuan and 22 million yuan respectively [6][7] - The company experienced a significant decline in revenue in 2024, with a reported 925 million yuan, a drop of about 37%, and a net loss of approximately 258 million yuan, marking a tenfold increase in losses [6][9] - In the first quarter of 2025, revenues further decreased to around 296 million yuan, a decline of approximately 29.4%, with net losses reaching about 38.9 million yuan, a staggering increase of 320% [6][7] Market Position and Competition - Jinzhongzi Liquor, once a prominent brand in Anhui, has seen its market share shrink, facing fierce competition from local brands such as Gujing Gongjiu and Yingjia Gongjiu [9][10] - Despite a 62.5% increase in revenue from outside Anhui in the first half of 2024, the overall scale remains small, limiting its national market influence [9] - The company's product structure is heavily weighted towards low-end products, which accounted for 68% of sales, resulting in lower profit margins [10][11] Executive Compensation Concerns - There is a notable contradiction between the rising executive compensation and the company's ongoing financial losses, with total executive pay increasing from approximately 3.441 million yuan in 2021 to about 12.794 million yuan in 2023 [11][12] - He Xiuxia's salary alone accounted for 23% of the total executive compensation in 2023, reflecting a significant increase from his initial salary [11][12] - This disparity has led to dissatisfaction among minority shareholders, with nearly half voting against the executive compensation proposal at the recent shareholders' meeting [12]