WANLIN LOGISTICS(SH:603117) Zheng Quan Zhi Xing·2025-07-10 16:22Summary of Key Points Core Viewpoint The company, Jiangsu Wanlin Modern Logistics Co., Ltd., has received an inquiry letter from the Shanghai Stock Exchange regarding its 2024 annual report, prompting a detailed response concerning fixed asset impairment, accounts receivable, debt risks, and management expenses. Group 1: Fixed Assets - As of the end of 2024, the company's fixed assets amounted to 785 million yuan, representing 56.68% of total assets, with an impairment loss of 13 million yuan recorded in 2023 due to the underperformance of its subsidiary, Lianyungang Wanlin Logistics Co., Ltd. [1][2] - The revenue from the loading and unloading business of Lianyungang Wanlin decreased by 9.50% year-on-year, with a gross margin decline of 2.08 percentage points [1][2]. - The company conducted a detailed impairment test on fixed assets, concluding that the market value of certain properties indicated impairment, leading to a provision of 12.94 million yuan [1][2][3]. Group 2: Accounts Receivable - By the end of 2024, other receivables totaled 69.91 million yuan, primarily from trade agency business, with 58.59% of receivables from China State Construction Engineering Corporation being over three years old [4][5]. - The company reported a 103.83% year-on-year increase in accounts receivable, reaching 30.49 million yuan, while revenue decreased by 24.15% [4][5]. - The company has adopted a collective expected credit loss rate for accounts receivable, transitioning from individual impairment provisions for certain clients [4][5][6]. Group 3: Debt Risks - As of the end of 2024, the company reported short-term borrowings of 40.14 million yuan and other payables of 149.04 million yuan, with cash reserves of only 18.70 million yuan, resulting in a current ratio of 0.47 [13][15]. - The company has faced challenges in obtaining bank credit, with a total borrowing balance of 20 million yuan from two banks, both maturing in June 2026 [15][16]. - The company anticipates generating approximately 80 million yuan in operating cash flow in 2025, which may alleviate some liquidity pressures [15][16]. Group 4: Management Expenses and Non-Recurring Gains - The total employee compensation expense was 25.54 million yuan, reflecting a year-on-year decrease of 15.06% [16]. - The company is required to provide further details on the components of management expenses and the rationale behind the decline in employee compensation [16].