Core Viewpoint - Yuanlong Yatu, the first A-share listed company in the gift industry, disclosed significant internal control issues, revealing that a sales employee is suspected of embezzlement through falsifying company documents and contracts [2][3]. Financial Impact - The fraudulent activities are believed to have affected the sales revenue for the first quarter of 2025 by approximately 29.35 million yuan, which could lead to a reduction in net profit attributable to shareholders by the same amount [3]. - For the first half of 2025, the company anticipates a net loss of between 5 million and 10 million yuan, compared to a profit of 25.79 million yuan in the same period last year, representing a decline of 119.39% to 138.78% [4]. - The net profit excluding non-recurring items is expected to be a loss of 8 million to 13 million yuan, down from a profit of 23.35 million yuan year-on-year, indicating a decrease of 134.27% to 155.69% [4]. Internal Control Assessment - Despite the ongoing investigation, the company previously reported no significant deficiencies in its internal controls for 2023 and 2024, asserting that it maintained effective financial reporting controls [5]. - The internal control evaluation reports from both the company and its sponsor indicated that there were no major deficiencies identified, and the governance structure was deemed sound [5]. Company Overview - Yuanlong Yatu, established in 1998 and listed on the Shenzhen Stock Exchange in June 2017, is recognized as a leading integrated marketing service provider in China, offering a range of services including gift products, digital marketing, and cultural creative products [6]. - As of July 11, the company's market capitalization stood at 5.423 billion yuan [6].

Core Viewpoint - Yuanlong Yatu disclosed significant internal control issues, revealing that a sales employee is suspected of embezzlement, which may lead to distorted financial reports for multiple periods [2][3][5]. Summary by Sections Internal Control Issues - The company found that a sales employee forged customer seals and sales contracts to fabricate sales, illegally appropriating company assets [2][3]. - Yuanlong Yatu reported the case to the Beijing Public Security Bureau, which has initiated a criminal investigation and taken coercive measures against the suspect [2][3]. Financial Impact - The fraudulent activities are linked to sales revenues for the first quarter of 2023, 2024, and 2025, with specific amounts pending investigation [6]. - Preliminary findings indicate that the embezzlement may impact the company's first-quarter sales revenue for 2025 by approximately 29.35 million yuan, potentially reducing net profit attributable to shareholders by the same amount [6]. - The company forecasted a loss for the first half of 2025, with net profit expected to be between a loss of 5 million to 10 million yuan, compared to a profit of 25.79 million yuan in the same period last year [7]. Internal Control Evaluation - Despite the ongoing investigation, previous internal control evaluations from 2023 and 2024 reported no significant deficiencies in financial reporting controls [9]. - The company and its sponsor provided positive assessments of its internal control systems, stating that they complied with relevant laws and regulations [9]. Company Overview - Yuanlong Yatu, established in 1998, is a leading integrated marketing service provider in China, listed on the Shenzhen Stock Exchange since June 6, 2017 [10]. - The company offers comprehensive marketing services, including promotional gifts, digital marketing, and cultural creative products [10]. - As of July 11, the company's market capitalization was 5.423 billion yuan [11].