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Recently, Huawei and Xiaomi’s supplier Jiahe Smart have fallen into rumors of bankruptcy.

On March 21, a public account published an article stating that “the well-known brand Cosonic headphone maker Jiahe Electronics, which has 4,000 employees, announced that all workers had their wages reduced or cleared from the factory due to the epidemic.” It is because the factory order is affected.

For a time, the news was misinformed as “Jiahe Electronics closed down” and spread widely on the Internet.

Public information shows that Jiahe Electronics is a wholly-owned group company established by Hong Kong Jiahe Electronics Group in the Mainland in 1991. Its factory is located in Shipai Town, Dongguan City and mainly produces electro-acoustic products such as headphones and speakers. In October 2019, Jiahe was listed on the Shenzhen Stock Exchange GEM under the name “Jiahe Intelligent Technology Co., Ltd.” (hereinafter referred to as Jiahe Intelligent) Go public.

In response to the above-mentioned rumors of closure, Jiahe Smart responded on the Shenzhen Stock Exchange Interactive Exchange, saying that “the news is false and the police have been reported.”

Jiahe Intelligent’s response shows that the company recruited some labor dispatchers for normal production in the early days of the resumption of work in February. As the current employees are basically returning to work, a small number of labor dispatchers have been suspended and contracted. Give compensation. The company expects that revenue in the first quarter will increase by about 10% compared with the same period last year. Orders in April will increase by about 30% compared with the same period last year. In order to ensure production, the recruitment of regular employees is currently ongoing.

Jiahe Smart responds to investors on the Interactive Easy

Interview journalists called Jiahe Intelligent Director’s Office to inquire for more specific information. The other party stated that it had given an explanation in the interactive Yi, and no other response would be made until the police investigation results came out.

A person in charge of recruiting workers in the Dongguan factory claimed to know the situation. According to him, Jiahe Electronics Factory had set a high price of 19 yuan / hour in February. The hired workers were temporary workers. text-remarks “label =” Remarks “> (that is, labor dispatch workers) , sign a three-month labor contract with the agency. But half a month after entering the factory, the hourly wage of 19 yuan was reduced to 15 yuan, causing workers’ dissatisfaction. The factory recently cleared more than 1,000 temporary workers and made compensation of 3,000-5,000 yuan for each.

Interface News verified this with a Jiahe electronic temporary worker who had left his own job. The other party stated that he did sign a contract with the intermediary for an hourly salary of 19 yuan. However, referring to the factory’s remarks and the specific number of people to be cleared, the worker said that he was not clear.

Then, an interface journalist consulted as a job seeker with a general worker recruiting in Dongguan. The other party said that Jiahe Electronics had stopped recruiting general workers, and temporary workers and regular workers had also stopped recruiting. Less factory orders have been reduced, many have closed down, or only a small number of people have been recruited. “

This is in stark contrast to the Shenzhen factory staff shortage reported earlier by Interface News. The Pearl River Delta manufacturing industry has always been centered on Shenzhen and Dongguan. Due to the epidemic in February, a large number of employees were unable to return to Guangdong, which triggered a wave of factory recruitment.

In March, most factories have basically resumed production, but due to the intensification of overseas epidemics, some factories mainly exporting foreign trade have fallen into survival difficulties. In Dongguan alone, the “neighbors” of Jiahe Electronics are in crisis. According to reports, on March 18, Panda Toys, a large toy manufacturer with more than 1,200 employees, announced its closure due to cancellation of European and American orders. On March 21, Dongguan Precision Watch Industry had to declare a three-month holiday due to the cancellation of all orders by its largest customer, the US FOSSIL, and faced the risk of shutting down at any time..

Jiahe Smart also encountered similar problems. It has established supplier cooperation relationships with many well-known brands at home and abroad, including Harman included in Samsung, Beats acquired by Apple, domestic magic magic, Lenovo, HKUST Xunfei and so on. In addition, Jiahe Smart also manufactures smart speakers for Himalaya FM, Xiaomi, Migu and other brands. In 2019, the company also cooperated with Huawei and entered Samsung’s supplier list. It was also once called the leader of TWS headphones.

In 2018, as the demand for TWS headsets began to explode, the domestic TWS headset market also rapidly expanded, and well-known manufacturers have entered the game. Brands including Xiaomi, Huawei, OPPO have launched their respective TWS headsets. Jiahe Smart also targeted this market, and its announcement showed that in the first half of 2019, its wireless earbuds business accounted for 61% of its total business, becoming the company’s main business.

Jiahe Smart’s 2015-2018 annual report shows that the company’s revenue and net profit have maintained high growth every year, but because of the iterative research and development of high-end wireless headsets, research and development costs have risen accordingly, and its 2019 profit is less than expected.

The lack of independent brands has limited the development of Jiahe Intelligence to some extent. Because the company mainly uses ODM (foundry production + R & D design) and OEM (Foundry production) mode of production, resulting in its extreme dependence on large customers. And these big customers are all focusing on overseas markets.

The research report released by Guojin Securities in November last year showed that Harvard’s largest customer is Jiahe Intelligent, which accounts for nearly 50% of its revenue. In the first half of 2019, Encore became its second largest customer, contributing With a revenue of 120 million yuan, the main market is also overseas.

In addition, Jiahe Intelligent invested nearly 70 million yuan in Vietnam’s production base in 2019 to serve international customers, but the base has not yet been put into production.

Under the epidemic, the overseas consumer electronics market has suffered a certain impact, which may cause Jiahe Smart’s overseas orders to shrink. Its stock price performance was also not satisfactory, and it continued to fall: in the mid-February resumption of work, it reached a maximum of 48.8 yuan, and then continued to fall to a minimum of 32.3 yuan, a decline of 34%, far from the peak of 72.83 yuan last November.

In the afternoon of March 25, Jiahe Smart disclosed the forecast of the first quarter of 2020. It is expected to lose 9.8 million yuan to 5 million yuan, a year-on-year loss. publicThe report shows that the revenue in the first quarter increased compared with the same period of the previous year, but due to the epidemic situation, the resumption of work was delayed, the production capacity was limited, and the shipment was lower than expected. At the same time, it was difficult to recruit workers and the cost of labor increased, resulting in increased operating costs and net profit decline.

Although the company emphasizes that its current business is stable, Jiahe Smart will face many challenges like all companies that rely on overseas orders in the future.

As of the close of the Shenzhen Stock Exchange on March 25, Jiahe Intelligent closed at 34.87 yuan with a market value of 5.812 billion yuan.