XiAn Qujiang Cultural Tourism Co Ltd

Qujiang Cultural Tourism released its 2026 interim report, achieving a turnaround to profit despite declining revenue, though non-recurring net profit remained negative. During the reporting period, the company achieved operating revenue of 390 million yuan, down 26.75 percent year on year. Net profit attributable to the parent company was 6.8128 million yuan, compared with a loss of 13.8807 million yuan in the same period last year. Net profit after deducting non-recurring items was negative 59.9494 million yuan, narrowing from a loss of 70.7402 million yuan a year earlier. The turnaround was mainly driven by cost control and non-recurring gains, including a reversal of impairment provisions on receivables subject to separate impairment testing of 54.7687 million yuan, debt restructuring gains of 5.0164 million yuan, and gains on disposal of non-current assets of 6.2748 million yuan, bringing total non-recurring gains to 66.7621 million yuan. Tourism scenic area operation and management remained the revenue pillar, accounting for 63.12 percent, mainly covering core scenic areas such as Tang Paradise and Qujiang Polar Ocean Park. Hotel and catering management revenue accounted for 25.69 percent, while tourism services and merchandise sales accounted for 11.19 percent. During the reporting period, tourism commercial operation revenue grew 35 percent, travel service revenue surged 72.72 percent, and food sales revenue rose 37 percent. The company received about 93,700 inbound tourists in the first half, but faces challenges including human resource structure optimization, revitalization of existing assets, and digital system development, as well as multiple pending lawsuits and investor claim risks.

Qujiang Cultural Tourism announced that 3 million company shares held by its controlling shareholder, Xi'an Qujiang Tourism Investment Group, will be judicially auctioned from September 7 to September 8, 2026, accounting for 4.52% of its holdings and 1.18% of the company's total share capital. The shares are currently frozen. The auction stems from a contract dispute with Zhejiang Zheyin Financial Leasing. In the first quarter of 2026, Qujiang Cultural Tourism reported revenue of 224 million yuan and a net loss attributable to the parent company of 14.42 million yuan.

Qujiang Cultural Tourism disclosed that the buyer, Qujiang Cultural and Financial Holding Group, failed to pay the auction balance on time, resulting in the unsuccessful auction of part of the company's shares. This marks the second time this year that Qujiang Financial Control has walked away from an auction. The auction lot comprised three million shares of Qujiang Cultural Tourism held by Qujiang Tourism Investment. Qujiang Financial Control won the bidding with the highest offer of 17.947 million yuan, with a deposit of 3.449 million yuan, which will not be refunded due to the default. In January this year, Qujiang Financial Control won three lots of two million shares each, totalling six million shares, but did not make payment. The deposit for each of those three two-million-share auctions was three million yuan, totalling nine million yuan, and those deposits are also at risk of loss. The combined deposit losses from the two defaults could reach 12.449 million yuan, and the company may also be liable to cover any shortfall in a re-auction.

Qujiang Cultural Tourism has been ordered by the Shaanxi Securities Regulatory Bureau to rectify violations including failure to review and disclose related-party transactions, failure to promptly disclose major litigation, and deficiencies in internal controls. Six responsible persons, including then-chairman Geng Lin, have been issued warning letters. Investigations found that related-party transactions such as equity transfers to related parties were not reviewed or not promptly reviewed and disclosed. The company also had internal control deficiencies in contract management, fund control, related-party transaction management, internal supervision, financial management and accounting, internal environment, and information communication. Then-chairmen Geng Lin, Xie Xiaoning, and Zhuang Ying, then-general managers Xie Xiaoning and Dong Shihong, then-finance chiefs Xie Xiaoning and Shen Shuyu, and then-acting board secretaries Zhuang Ying and Zhao Qian bear primary responsibility for the above violations. Qujiang Cultural Tourism's 2025 annual report shows operating revenue of 967 million yuan, down 22.83 percent year-on-year, and a net loss attributable to the parent company of 196 million yuan, with the loss widening from the previous year.