The number of users of the target company declined in the first half of the year, but operating income increased sharply; it promised to complete a net profit of 70 million in 2016, but only completed 16.47 million in the first half of this year
html August 29 Fuchun Communications (stock code: 300299), which started by providing communication network technology services to the three major operators, issued an asset restructuring announcement stating that the company plans to acquire Chengdu Mochikaka Technology Co., Ltd. for 1.054 billion yuan, with a premium rate of 52.5 times.Mochikaka is a company mainly engaged in the development and production of mobile games. This is another cross-border acquisition by Fuchun Communications since its acquisition of gaming company Shanghai Junmeng in 2015. Although
was acquired at a high premium, there are still many uncertainties about Mochikaka's future performance. In view of the high performance commitment, no detailed business forecast has been made, and the performance betting method also carries risks. In the past six months, Mochikaka's revenue has increased by more than 30 million yuan, achieving a turnaround. However, the reason for the turnaround has not been disclosed, which also raises questions about the source of revenue.
The net profit of the target company increased sharply in the first half of the year.
Fuchun Communications was founded in 2001. Before acquiring the game company Shanghai Junmeng in May last year, Fuchun Communications was mainly engaged in communication network planning and technical services.
Under the pressure of traditional performance management, Fuchun Communications has turned its attention to large cultural fields such as online games, animation, online literature, reading, and film industries.
At present, game revenue has become the main source of income for listed companies. This acquisition of Mochikaka is also Fuchun Communications’ further foray into the gaming field.
was founded in 2011 by Mochikaka. Its main business is mobile game development and production. It has proposed the strategy of "well-known IP + big data analysis + industrial production". Its games include "New Master" and "Inuyasha: Search for Jade" Journey" and "Havoc in Heaven HD" etc.
Fuchun Communications acquired 100% of Mochikaka's equity this time at a transaction price of 1.054 billion yuan. It plans to pay 35% of the total price in cash and the remaining amount in the form of stock consideration. At the same time, Fuchun Communications plans to raise supporting funds of no more than 400 million yuan from a non-public issuance of shares from no more than 5 qualified investors, which will be used to pay intermediary fees and transaction taxes as well as cash consideration for the underlying assets.
In this transaction, taking June 30, 2016 as the base date, the book value of Mochikaka’s net assets attributable to the parent company was 19.7106 million yuan, with a valuation of 1.054 billion yuan, and the value-added amount of was 1.034 billion yuan. The rate is 5246%.
Mochikaka's net profits were in the red from 2014 to 2015, which were -2.7682 million yuan and -4.4181 million yuan respectively. In the first half of 2016, net profit suddenly increased to 16.4889 million yuan. In terms of
revenue, Mochikaka’s operating income in the previous two years was 6.3282 million yuan and 5.9618 million yuan respectively. As of the first half of 2016, it suddenly increased to 30.0763 million yuan.
However, the draft did not disclose the reasons for the rapid increase in operating income in the first half of the year. On September 2, the reporter asked Mochikaka and Fuchun Communications for comment on related issues. As of press time, no response was received.
user data and operational data are “upside down”.
Mochikaka is a game developer. Its main sources of income include game operation income, game licensing income, technology development income, etc. Among them, game operating income is usually one of the core income sources of game companies.
game operating income refers to the fact that game developers provide free online game downloads and experiences for the game. In the game, they charge fees by selling value-added services such as virtual props to game players. Industry insiders said that the common "flush" situation commonly said by game companies generally occurs in this link.
From the perspective of Mochikaka’s main business, in December 2015, Mochikaka added its main business – the mobile online games “New Master” and “Inuyasha”. Among them, the operator of "New Master" in the mainland is Shanghai Spades Interactive Network Technology Co., Ltd. This company was Mochikaka's largest sales customer in the first half of 2016, with sales of 27.9606 million yuan, and the proportion of total operating income was as high as 92.97%,.
Based on this, we can judge that the sudden increase in Mochikaka's operating income in the first half of the year is related to "New Master".
According to the draft, as of June 2016, the game had more than 200,000 paying users, and the cumulative turnover exceeded 100 million yuan.
However, the reporter noticed that in December 2015, the month of first operation, the number of paying users was the highest at 72,000, and has been declining since then. In February 2016, the number of paying users fell below the 40,000 mark, and by 2016 In June, the number of paying users dropped to 34,000. In addition, the number of monthly active users has also declined for five consecutive months, to 375,000 in May 2016.
While both paying users and active users are declining overall, the game operation revenue of "New Master" has been soaring, rising from 17.3833 million yuan in December 2015. Only the sales in April and June 2016 were Revenue was slightly lower than in December 2015. In May 2016, when the number of people paying had dropped by nearly half to 37,000 compared to December 2015, the corresponding turnover was still over 17 million yuan.
At the same time, as a game developer, you need to share the revenue with operating agents, and there is a time limit. At present, it is unknown whether Mochikaka has already conducted revenue sharing with Shanghai Spades. If the two have not yet been divided, it remains to be further disclosed whether the relevant amounts will be included in the operating income account and whether the sudden increase of more than 30 million yuan in income comes from "New Master". A reporter from
asked Mochikaka about the “upside down” of user data and operational data. As of press time, the other party had not responded.
Whether the performance commitment can be fulfilled is doubtful
Judging from the performance commitment of the target company, Mochikaka has given a performance commitment and promised to deduct non-recurring expenses achieved by Mochikaka in 2016, 2017, 2018 and 2019. The net profits attributable to shareholders of the parent company after profits and losses are no less than 70 million yuan, 91 million yuan, 120 million yuan and 120 million yuan respectively.
draft data shows that in the first half of 2016, Mochikaka’s net profit was 16.4689 million yuan. If it wants to realize its performance commitment in 2016, it needs to complete 53.5311 million yuan in the next six months, which is 3.25 times the performance in the first half of the year. . The
reporter noticed that for the target company acquired at a high premium of 52.5 times, the draft did not disclose the overall forecast operating income and operating costs of the target company in the future performance commitment year, as well as the categories and profitability of each main business. This This means that investors cannot obtain the basis for the realization of performance commitments from the draft, and it is difficult to analyze the possibility of realizing the performance commitments. In addition to the almost blank future performance forecast of
, there is also uncertainty in the profit commitment and performance compensation measures in this acquisition.
According to the compensation arrangement, if the commitment is not fulfilled, 65% of the amount that should be compensated in the current period will be compensated in the form of stocks, and the remaining part will be compensated in the form of cash. If the shares held by the indemnifiers Fan Ping, Qiu Xiaoxia and Fu Peng are insufficient to fulfill the share compensation obligations, with the consent of Fuchun Communications, the shortfall will be compensated in cash. The compensation obligors will be compensated thirty years after receiving the notice from Fuchun Communications. Pay to Fuchun Communications within the same day.
In addition, the compensation measures also set up an "insurance rope": if the actual net profit amount in each year during the commitment period exceeds the promised net profit amount for that year, the excess portion will not reach the promised net profit amount in subsequent years during the commitment period. The profit amount can be used to make up the difference.
In this regard, the restructuring plan also carries a risk warning: if the target company cannot achieve the promised performance during the performance commitment period, there may be situations where the counterparty's profit compensation arrangement is insufficient to cover the loss of the underlying assets, and there are also problems with the implementation of the performance compensation commitment. Default risk.
has a precedent of acquisition targets failing to achieve performance.
Mochikaka is the third game company that Fuchun Communications has tried to acquire. Fuchun Communications' love for game companies has become prominent since 2015. In May 2015, Fuchun Communications acquired 100% of the equity of Shanghai Junmeng for 900 million yuan and began to enter online games.
Affected by this, Fuchun Communications performed well in its 2015 financial report, with revenue of 378 million yuan, a year-on-year increase of 69.79%, and net profit attributable to listed companies of 69.9509 million yuan, a year-on-year increase of 376.31%. Among them, game business revenue reached 149 million yuan, accounting for 39.34% of operating revenue.
Fuchun Communications stated that the substantial growth in business was mainly due to the acquisition of Shanghai Junmeng and the consolidation of financial statements. However, Shanghai Junmeng’s performance in 2015 was not ideal.The company's performance commitment for 2015 was 83.7 million yuan, but in fact it achieved a non-net profit of 66.84 million yuan.
Fuchun Communications' acquisition pace has not stalled. Fuchun Communications suspended trading in February this year and announced the acquisition of gaming companies. By May, the listed company announced that the target company was Shanghai Wanjia, and later stated in the draft that due to the complexity of the target company's dismantling of the VIE structure, it terminated the major asset restructuring cooperation out of caution. A supplementary announcement was quickly issued the next day, adding Mochikaka as a restructuring target.
Mochikaka's value-added portion that is greater than the fair value of its identifiable net assets will be recognized as goodwill, and Fuchun Communications' goodwill will increase by another 1.034 billion yuan. If Mochikaka cannot deliver the expected results in the future, listed companies will also face the risk of impairment of goodwill and their performance will be affected.
Beijing News reporter Zhang Fan reports from Beijing. Reporting email: zfstxbb@126.com
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