Recently, Dongyi Risheng Home Decoration Group Co., Ltd. is mired in "running away" public opinion storm. On May 23, the Shenzhen Stock Exchange issued a letter of concern to Dongyi Risheng, expressing concern about the incident.

The Shenzhen Stock Exchange said, "recent media reports show that your company's branches in Wuxi, Zhengzhou, Wuhan and other places have 'run away' rumors that they have" basically lost their ability to perform contracts "and that their employees have been forced to leave and their wages are in arrears. It is difficult for some consumers and suppliers to safeguard their rights.

The Shenzhen Stock Exchange requires Dongyi Risheng to fully verify and explain the main business operations and personnel management of the company, its subsidiaries and subsidiaries, and whether business activities such as shop closure, closure, cancellation, bankruptcy and other business activities have been seriously affected, whether the above media reports are true. If so, please state the proportion of the operating income and net profit of the relevant subsidiaries and branches in the company's operating income and net profit, sort out the number and amount of consumers and suppliers involved in the failure of the relevant subjects, and whether there are disputes or potential disputes, the impact on your company's sustainable business ability, and the measures and feasibility that the company intends to take and has taken to safeguard the legitimate rights of consumers and suppliers.

In addition, the Shenzhen Stock Exchange also requires the company to explain, in the light of the above situation and duration, whether there is a situation in which production and business activities are seriously affected and are not expected to return to normal within three months, whether there is a situation in which major bank accounts are frozen, whether it is required to implement your company's stock trading in accordance with the provisions of our Stock listing rules (revised in 2024).FreearcadegamesonlineHis risk warning situation.

The announcement shows that Dongyi Risheng should make a written explanation on the above issues and submit the relevant explanatory materials and disclose them to the public before May 27, 2024.

For the specific situation, the "Securities Daily" reporter has repeatedly called Dongyi Risheng public phone, but did not get through.

Prior to this, Zhengzhou Dongyi Risheng said in the official WeChat that the Zhengzhou branch did not run away as rumored on the Internet, but only because the enterprise cost was too high, coupled with the epidemic and downward pressure on real estate in recent years. Is shrinking stores to maximize operating costs.

On May 16, Chen Hui, chairman of Dongyi Risheng, also said at the performance presentation that it is normal for the company to adjust and optimize the storefront according to the operation of each storefront, and the relevant business has also been handled by special personnel.

However, judging from the financial data, Dongyi Risheng is currently under pressure. Data show that Dongyi Risheng achieved a net profit of-7% in 2022 and 2023 respectively.Freearcadegamesonline.44 billion yuan,-2FreearcadegamesonlineIt has lost money for two consecutive years, totaling 0.08 billion yuan. In the first quarter of 2024, Dongyi Risheng's performance was still in the doldrums, with revenue down 20.68% from the same period last year and a net profit loss of about 116 million yuan.

In addition, the monetary funds on Dongyi Risheng account have also decreased in the past two years, while short-term borrowing has increased significantly. According to the data, the monetary funds on the company's account from 2021 to 2023 are 898 million yuan, 512 million yuan and 500 million yuan respectively. Short-term loans are 55.68 million yuan, 361 million yuan and 383 million yuan respectively.

Yang Zhaoquan, director of Beijing Weinuo Law firm, told the Securities Daily that if it is true that several branches of Dongyi Risheng "run away", it may lead to a substantial decline in the company's market share in these areas, and at the same time, it may also lead to lawsuits to safeguard rights, including consumers and suppliers, which will further increase the company's legal risk and financial pressure.

In addition, according to the relevant regulations, the exchange may implement its shares in cases where major bank accounts are frozen or the company's production and business activities are seriously affected and are not expected to return to normal within three months.FreearcadegamesonlineHis risk warning (ST).

Yang Zhaoquan said that in order to eliminate the impact and solve the problem as soon as possible, Dongyi Risheng should issue a formal statement as soon as possible to clarify the truth, explain the situation to consumers and suppliers and apologize. This helps to restore trust in the company and to find a proper solution. At the same time, the company also needs to strengthen the management and supervision of the branch to ensure that similar incidents do not happen again.

On May 24, Dongyi Risheng shares closed at 3.10 yuan, down 9.88%, to close by the daily limit.

(source: Securities Daily)