Per reporter Shu Dongni Ke Yang Intern Zhang Yilei

Not all businesses can make it into spring.

When consumption recovered overall, Christine (HK01210, stock price of HK$0.065, market value HK$7879.5 million), the former "first baking stock", was once again involved in a storm. Earlier, the company disclosed that due to operational difficulties, delays in paying store rent, supplier payments, and employee salaries had brought a total of RMB 5700 million in arrears to the company.

Recently, the "Daily Economic News" reporter interviewed Christine's suppliers, factories and employees in many ways and learned that Christine, who was trapped in the company's infighting, has fallen into the quagmire of shutdown and supply cut. "It is difficult to open again, I hope to go bankrupt and liquidate as soon as possible." Luo Tianan, the founder of the company, said.

Production plant: closed last year

As early as July 2022, Christine has fallen into the vortex of "business abnormality". At that time, the company was exposed that almost all stores in Shanghai had suspended business, and the amount of prepaid cards and coupons to be paid exceeded 7 million yuan, and there were various problems such as store rent and employee salaries.

On March 3 this year, Christine issued an announcement that put all the issues on the surface: "The Group has experienced tight cash flow and operational difficulties, and has experienced delays in paying store rent, supplier payments, and employee compensation, and as of February 10, 2023, the amount owed is about RMB 2 million." As a result of arrears, a number of suppliers have initiated legal proceedings to freeze the Group's bank accounts. ”

Christine said in the announcement that due to the continuous impact of the epidemic and the lockdown in Shanghai (Christine's main business location) in 2022, consumer spending has decreased, and the group's business has suffered a serious blow. Although the Group actively adjusted its production and sales strategies to cope with the adverse impact, it was still insufficient to meet the various payments.

The reporter of "Daily Economic News" visited Christine's Shanghai production plant, interviewed the company's suppliers and employees, and found that the crisis actually came earlier.

On the morning of March 3, at Christine's production base Shanghai Double Red Bread Co., Ltd., the electric telescopic door was locked, the security room was empty, and an epidemic protection notice was still pasted on the glass, and the payment time was October 22, 2022.

"There is no one in the factory, and the security guards have long been removed." An employee of a nearby company told reporters that the factory had stopped work last year, and in the second half of 2022, employees came to the door many times to ask for wages, "It turns out that this cake is very well made." But the factory has not been popular in recent years, and there are few employees. Listen to them, this company is not very good."

In the afternoon of the same day, the reporter came to Shanghai Jiyuande Food Co., Ltd., another production base of Christine, and the situation was similar: the factory door was closed, and no personnel entered or left.

"I heard that the door is opening again, I'll take a look." At the gate of the factory, the reporter met Wang Li (pseudonym), an employee who has worked in the factory for more than ten years and has now left, wandering at the factory gate. She introduced that since July 2022, the factory has stopped paying wages, in August in order to catch up with the production of Mid-Autumn Festival products, it also worked overtime, stopped production in October, and began to close in November, no longer allowing employees to work in the factory.

"When I first came here more than a decade ago, there were two or three hundred people in this factory, and the efficiency was also very good, often working overtime, 12 hours a day. Later, it became worse and worse, and one after another people left, and there were almost (only) a hundred people on several floors. At the end of last year, a lot of people left, and there were still people who stayed. Some people's salaries have been paid some time ago, but mine has not. Wang Li said that now that she has found a new job, she came to the factory again this time to get back the arrears of wages.

On March 3, reporters also called the public phones of the two companies, but none of them answered.

Regarding the arrears of employees' wages, a manager who has worked for Christine for nearly 20 years described the situation to reporters in more detail.

"After the outbreak of the epidemic in 2020, there was also a shutdown in the middle, and at that time there was a little bit of a month late in pay, but it was not very long. The procrastination that has really become a norm is from the Spring Festival in 2022, and it will be stopped in a few months. By the time he left the company in the second half of 2022, the social security provident fund had been delayed for several months. The administrator said that when he left Christine, he was already owed 4 months of social security provident fund and 1 month's salary.

On March 3, the reporter also came to Christine's Shanghai headquarters on Jinshajiang Road in Putuo District, where the usually resplendent building now has not even turned on the lights, the door is closed, and only a security guard is left at the gate. The reporter learned that no one has gone to work normally at the headquarters since this year.

On the same day, from time to time, consumers came to the site to fill in the registration form for unspent prepaid cards and coupons. The reporter noticed that there were multiple filled registration forms on the table.

Supplier: Litigation has commenced

Some employees have not been paid, some consumers have not used up their gift certificates and prepaid cards, and some suppliers have been in arrears for a long time.

Two suppliers who have worked with Christine for many years confirmed to reporters that since the first half of 2022, Christine has begun to default on the payment, and because the payment has not been settled, some suppliers have chosen to stop supply since October 2022, and another supplier has begun to file a lawsuit.

"There are reasons for the epidemic, but they all attribute (the problem) to the epidemic, I personally think it is not quite right, the key is still that there is no intention in operation. Have you ever seen a company that never mentions performance at a meeting? There are also no clear goals, have you ever seen it? The administrator, who has worked for Christine for nearly 20 years, said she does not believe Christine's defeat is solely the cause of the epidemic.

In fact, there has been a protracted infighting between Christine's top officials. In November 2017, Christine's founder and then-CEO Luo Tianan was removed from the board of directors by a joint proposal. A year later, Luo Tianan stepped down as CEO and was replaced by Zhu Yongning. In May 11, Luo Tianan submitted a real-name report letter to the Hong Kong Stock Exchange, alleging that Zhu Yongning had obtained equity and voting rights through illegal means, and that continuous infighting after the listing had brought down the company, and Zhu Yongning responded that Luo Tianan was "dishonest and a lie".

The two sides have been fighting for many years, and Christine's business situation has also deteriorated. Some suppliers believe that the downhill road began around 2018. He recalled that around 2018, Christine's orders began to decline. Another supplier mentioned: "We went in in in 2014 and did quite well, supplying <> or <> tons a month, and then only a dozen tons. ”

In the past two years, the crisis has completely broken out, and a supplier who has supplied Christine with eggs since 2014 told the "Daily Economic News" reporter that since the second half of 2021, Christine began to show signs of arrears. Initially, the contract period he signed with Christine was 30 days, and from the second half of 2020, the negotiation period was extended to 60 days, and by the end of 2021, Christine began to pay on time. Up to now, the supplier still has more than 60,<> yuan of outstanding payment.

Until March 3 this year, the company made an announcement to put the crisis in front of the stage.

However, in the announcement, Christine still said that at present, the group is actively seeking to diversify its business, plans to solve the liquidity problem through appropriate financing methods (such as asset sale and equity financing), and resume business in the first half of 2023.

For the diversified development direction of the business, Christine did not specify in the announcement. However, in the 2020 and 2021 financial reports, Christine mentioned that it is negotiating with some hospitals and schools to establish long-term strategic cooperation, in order to inject richer connotations into the Christine brand under the guidance of Chinese medicine theory, combined with dietary therapy and health care elements.

For the resumption of operations in the first half of the year, in the supplier's view, Christine may still be under pressure to solve the problem of consumer stored value cards as in August 2022. At that time, the arrears may also have the opportunity to be settled through negotiation.

In March 2022, some suppliers began to cut off supply due to Christine's arrears of payment. "By August 3st last year it was going to reopen, so on July 8th, we urgently called our suppliers over and asked us to supply, so the two sides negotiated, from settling 1% of the payment, to 7%, and finally talking about 27%, and then we started supplying on July 30th."

But he no longer had hope that Christine would return to her former business situation, and "his mind was not on the business."

Founder: Hope for early bankruptcy and liquidation

"Christine all stores are temporarily suspended" is on the hot search, but Christine's brand may be unfamiliar to young people. Opening the dusty history, the "first stock of baking" has indeed been brilliant.

Christine was founded in 1993 and this year marks its thirtieth anniversary. Christine is also a representative of an earlier batch of foreign-invested bakery enterprises, and is famous for its Western-style baking cold chain technology, central baking factory model and branded chain operation model.

In the memory of the Internet, Christine was a food supplier for the 2001 APCE meeting, the 2005 National Games, the 2005 World Table Tennis Championships, the 2007 Antarctic Research by Scientists, the 2007 Special Olympics, the 2008 Global Chinese Basketball Championship, the 2008 Olympic Games (Shanghai Football Tournament), and the sponsor of the 2010 Shanghai World Expo and the designated supplier of pastry and bread.

In 2012, on the occasion of its 20th anniversary, Christine was listed on the Hong Kong Stock Exchange and was known as the "first stock of baking".

At that time, Christine had more than 13,88 stores in the Yangtze River Delta region, with an annual revenue of 2011.2013 billion yuan. From 234 to <>, Christine maintained a rapid expansion trend, opening a total of <> new stores in three years.

It's all the rage.

However, from 2014 until the first half of 2022, Christine's stores were in a net decline trend, and by the first half of 2022, the number of stores had shrunk to 246. As the number of stores shrank, losses followed. From the past performance, since 2013, Christine has lost money for 9 consecutive years, and the operating income has also declined year by year.

In the first half of 2022, Christine achieved revenue of about 4650.9 million yuan, a decrease of about 2021.16182% from 9.71 million yuan in the same period of 3; Gross profit decreased from RMB7197.7 million to RMB2022.920 million in the first half of 9, a year-on-year decrease of approximately 87.2%.

Christine said that the reason for the decrease in revenue is related to the epidemic in Shanghai in the first half of 2022, the group's strategy of closing loss-making stores, and the new cooperation has not yet led to an increase in revenue after changing the traditional marketing model.

But even in that outbreak, Christine still had a chance to catch fire again. On March 3, the reporter met Christine's founder Luo Tian'an in Shanghai, and he told the reporter that at that time, the demand for bags and pastries in Shanghai added up to more than 22,<>, but the supplier's payment and employee wages had been in arrears for several months, and he was unable to start work.

Coming to the current situation, Luo Tianan has also reflected. "In 2012, after the company went public, people's hearts swelled, and no one was serious about business. All day long, shareholders come to ask, is this investable? Is that investable? I said no, then disagreed, and shareholders began to defect. ”

This was followed by a long period of shareholder infighting. For the current situation of the company, the reporter also tried to contact Christine's chairman and executive director Xu Chunbin and general manager Zhu Yongning, but did not get a response.

Christine's defeat seems to be a foregone conclusion, and in the long-term contact between the "Daily Economic News" reporter and Luo Tianan, the most he said was, "As long as you get the embezzled money back and reduce the scale, Christine still has a chance to come again..."

But when asked by reporters whether the "resumption of business in the first half of 2023" in the company's announcement could be realized, Luo Tianan repeatedly told reporters: "It is difficult to open again, I hope to go bankrupt and liquidate as soon as possible." "There are still many employees who have not received their salaries, the money in consumer cards and coupons has not been paid, and the supplier payment has not been settled."

"There is no chance, times have changed... If you go back twenty years, forty or fifty years old, there may still be a chance, but now there is none. A person close to Luo Tianan said.