China's largest wine producer Changyu A (000869.SZ) released a forecast of its performance decline, and its net profit is expected to drop by more than 50% year-on-year.
According to the announcement, Changyu expects 2020 net profit to be 468 million RMB to 571 million RMB, a decrease of 50% to 59% year-on-year, and this decline exceeds the decline in the 2020 semi-annual and three-quarter reports. From January to September 2020, Changyu achieved revenue of 2.19 billion yuan, a year-on-year decline of 38.3%. The decline in the third quarter has narrowed, down 21.1%.
Regarding the reason for the sharp decline in profits, Changyu said that on the one hand, the domestic wine market as a whole continued to shrink due to the epidemic and other factors, resulting in a significant year-on-year decline in operating income, which weakened profitability; on the other hand, it was due to the use of trademarks. After deducting value-added tax, the fee difference is 219 million yuan and is included in the 2019 profit and loss, but in 2020 the figure is zero. At the same time, in 2020, Changyu Company acquired the travel business of Changyu Group, so the report for 2019 will be adjusted accordingly.
编辑：Frida Xu
