Qingda Environmental Protection (688501) issued a prospectus for the issuance of A shares to specific targets in 2024 on March 8, and the company intends to issue no more than 14,577,259 shares (including the number) to Wang Yong, the controlling shareholder and actual controller, and the total amount of funds raised will not exceed 150 million yuan, and the net amount will be used to supplement liquidity after deducting the issuance costs. The issue price is 10.29 yuan per share, which is not less than 80% of the average stock trading price in the 20 trading days before the pricing benchmark date. The issuance constitutes a connected transaction with the Company.

Prior to this issuance, Wang Yong directly and indirectly controlled 32.97% of the voting rights of the company and was the actual controller of the company. The shares issued this time will be fully subscribed by Wang Yong.

Qingda Environmental Protection's share price has continued to rebound recently, rising 0.62% on March 9 to close at 17.99 yuan per share, an increase of nearly three percent during the year.

According to the data, Qingda Environmental Protection is a high-tech energy-saving and environmental protection equipment manufacturing service provider integrating design, manufacturing, sales and service, and its main income comes from the power and heat industries. The company went public in July 2021.

Since the listing of Qingda Environmental Protection, revenue and net profit have increased year after year. In 2024, the company will achieve operating income of 1.314 billion yuan, a year-on-year increase of 27.70%; The net profit attributable to the owners of the parent company was 94.1429 million yuan, a year-on-year increase of 8.61%.

Although the performance has increased year after year, there are also hidden concerns in Qingda's environmental protection operation.

From 2021 to the first three quarters of 2024, the company's accounts receivable balance was 513 million yuan, 483 million yuan, 708 million yuan and 716 million yuan respectively, accounting for 81.67%, 63.35%, 68.78% and 69.88% of the operating income in each period. Qingda Environmental Protection said that if there are adverse changes such as deterioration in the capital situation of downstream customers in the future, it will lead to the situation that accounts receivable cannot be recovered in time, which will have an adverse impact on the company's production and operation.

As of the end of the third quarter of 2024, the book value of the company's inventory was 754 million yuan, accounting for 36.21% of the current assets at the end of the period, and the inventory scale was large.

As of the end of the third quarter of 2024, the total book value of accounts receivable and inventory of Qingda Environmental Protection was 1.386 billion yuan, accounting for 51.58% of total assets.

In the first three quarters of 2024, the net cash flow generated by Qingda's environmental protection operating activities was -241 million yuan, a decrease of about 115 million yuan or 90.8% year-on-year from the same period in 2023. At the same time, the company's debt-to-asset ratio has increased year by year, reaching 65.43% at the end of the third quarter of 2024, compared to 45.53% at the end of 2021.

Qingda Environmental Protection said that through the issuance of funds to supplement liquidity, the company can effectively alleviate financial pressure, reduce financial costs, the company's asset-liability ratio will be reduced, the current ratio and quick ratio will be improved, and the ability to repay debts will be further enhanced.