Fujian Yongan Forestry (stock code: 000663) is a company that focuses on the cultivation and development of forestry resources, timber processing, and production and sales of green furniture. The company is committed to achieving sustainable development of forest resources and promoting ecological civilization construction through scientific management and technological innovation. As the main force of ecological civilization construction, Yongan Forestry advocates technological forest management and digital forest development in the forest management field, aiming to efficiently use forest resources and actively explore the development of forestry carbon sink and market-oriented trading capabilities. In the field of sheet furniture, the company produces various specifications of fiberboard, particleboard, and other artificial board products, which are widely used in construction, decoration, furniture and other fields. The company actively responds to market challenges by developing high value-added new products and optimizing supply chains. In addition, Yongan Forestry also ventures into the field of biomass energy, using organic waste from agriculture and forestry to produce bio-natural gas and organic fertilizer, helping to improve energy independence and ecological environment. The company strives to improve its business output and profitability through diversified business models.

In the first quarter report of 2024, Yongan Forestry's total assets at the end of the period was 164.9 million yuan, a decrease of 1.33% compared to the beginning of the period. The total liabilities at the end of the period was 52.5 million yuan, a decrease of 2.32% compared to the beginning of the period. The asset-liability ratio decreased from 32.18% at the beginning of the period to 31.85% at the end of the period, indicating that the company has made some progress in controlling liabilities. The balance of accounts receivable at the end of the period was 43.6 million yuan, an increase of 31.92% since the beginning of the period, mainly due to the increase in accounts receivable for fiberboard. The balance of prepaid expenses at the end of the period was 35.6 million yuan, a surge of 927.61% compared to the beginning of the period, mainly due to the increase in prepayment of electricity fees. The balance of taxes and surcharges payable at the end of the period was 35.1 million yuan, an increase of 55.08% compared to the beginning of the period, mainly due to the increase in value-added tax payable.

In terms of profits, Yongan Forestry's operating income for this period was 567 million yuan, a year-on-year decrease of 58.91%, mainly due to a decrease in income from forest asset transfer. The cost of goods sold was 519.8 million yuan, a year-on-year decrease of 32.29%, also due to a decrease in the cost of forest asset transfer. The gross profit margin fell sharply from 44.37% in the same period last year to 8.32%, and the net profit margin fell from 39.19% in the same period last year to -15.71%, showing a significant decline in the company's profitability. The net income was -8.91 million yuan, compared to 54.08 million yuan in the same period last year, a decrease of 116.51%. Return on Equity (ROE) fell from 5.6% at the beginning of the period to -0.79% at the end of the period, indicating that the company was not able to effectively use shareholder equity to create profits in this period.

In terms of cash flow, the net cash flow from operating activities was -10.62 million yuan, a year-on-year decrease of 118.45%. The subtotal of cash inflows from operating activities was 700.9 million yuan, a year-on-year decrease of 44.21%, mainly due to the decrease in cash received from the transfer of forest assets. The subtotal of cash outflows from operating activities was 807.1 million yuan, a year-on-year increase of 18.61%, mainly due to the increase in cash paid for various taxes and cash paid for debt repayment. In terms of investment activities, the cash paid for the purchase and construction of fixed assets, intangible assets, and other long-term assets was 17.6 million yuan, a year-on-year decrease of 98.35%, mainly due to the decrease in investment in biomass energy projects. In terms of financing activities, the cash paid for debt repayment was 0.5 million yuan, and there was no such expenditure in the same period last year.

Overall, Yongan Forestry faced significant challenges in the first quarter of 2024. Although some progress has been made in asset-liability management, operating income and profit have declined significantly, and the cash flow situation is not optimistic. The company needs to further optimize its operating strategy and improve its profitability, especially in the face of increased market uncertainty. How to control costs and increase revenue effectively will be the key. In the future, the company should continue to strengthen technological innovation and market development, actively respond to market challenges and improve overall business efficiency.