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Financial Services Association, September 11 (Reporter Ren Chaoyu) -- Hollywood (603898.SH) today disclosed an announcement announcing the start of the resale of “Hospitality Bonds” (113542.SH). This is the second time in the year that the company has started a resale. Previously, the company had announced many times that it would not lower the convertible debt-for-share price. At the same time, due to factors such as weakening prosperity in the home furnishing industry, the company's revenue and net profit both declined year-on-year in the first half of the year.

The company announced this evening that the “Hospitality Convertible Bonds” will commence resale from September 23, 2024 to September 27, 2024. The resale price is RMB 100.29 per sheet (including current accrued interest and taxes). The resale is not mandatory. If the “Hospitality Convertible Bonds” holder has satisfied the resale terms this time and has not declared and implemented the resale within the above resale period, the resale right can no longer be exercised during the interest-bearing year, that is, August 1, 2024 to July 31, 2025.

According to the agreement of the company's “Public Offering of Convertible Corporate Bonds”, the closing price of Holike A shares for 30 consecutive trading days from August 1, 2024 to September 11, 2024 was lower than 70% of the current conversion price of the company's “Hospitality Bonds”, and the convertible bond resale clause came into effect.

Check out the historical announcement. This is the second time in the year that Hollywood has started a resale after repeatedly announcing that it will not lower the convertible debt-for-share price. The last time it was announced was on March 12.

According to the September 10 announcement, the latest conversion price for “Hospitality Bonds” is 15.18 yuan/share. As of today's close, Hollyke's stock price was 7.18 yuan/share. Since this year, the company's stock price has fallen by 32.77%, or by 46.78% in the past five years.

In the first half of 2024, the company achieved operating income of 0.923 billion yuan, a year-on-year decrease of 5.06%. After deducting non-return net profit of 0.03 billion yuan, a year-on-year decrease of 48.85%.

The company said that there were three main reasons why the home terminal retail market was still recovering during the reporting period. Although the company achieved high growth in the overall scale of the business, it was unable to make up for the decline gap in the traditional retail market due to the overall scale of the business; second, the company actively sought changes, persisted in bucking the trend and increased investment, and built a full-category, omni-channel system to reshape the core competitiveness of the enterprise; third, the company implemented employee shareholding plans, and increased incentive fee amortization during the reporting period.

However, Hollywood has plenty of capital. As of June 30, 2024, the balance ratio was only 29.87%, the current ratio was 4.13, and the frozen ratio was 3.58. This may be one of the reasons why the company chose not to lower the convertible debt-for-share price and resell it.

“Hospitality Convertible Bonds” was issued in 2019, with a scale of 0.63 billion yuan. According to the prospectus at the time, after deducting the relevant distribution fees, it is planned to invest entirely in the Hanchuan Custom Home Furnishing Industry 4.0 manufacturing base project.