On June 12, the Shanghai Food and Drug Administration issued the “2018 Phase 2 Cosmetics Supervision and Sampling Quality Announcement” shows that in the quality supervision and sampling inspection of cosmetics production and operation enterprises in Shanghai from December 2017 ~ March 2018, the bureau completed a total of 439 inspections, of which 430 were qualified, with a pass rate of 97.9%.
Among them, the sample of Yujie anti-dandruff shampoo (deep anti-dandruff) produced by Lafang Jahwa (603630, SH) was unqualified.
In this regard, the secretary of the board of directors of Lafang Jahwa told the “Daily Economic News” reporter that the unqualified items in the random inspection products are acrylamide, and the company has launched an emergency plan, and will set up a special investigation team and send the product for inspection of Yujie shampoo products, and the company will recall all the above problematic batches of products without reason.
Rain Cleansing Shampoo involves excessive acrylamide
According to the announcement of the Shanghai Food and Drug Administration, after inspection, the batch of Yujie anti-dandruff shampoo (deep anti-dandruff) D0527YI64 produced by Lafang Jahua produced by Shanghai Agricultural Industry and Commerce Baoshan Supermarket Co., Ltd. did not meet the relevant provisions of the “Cosmetics Safety and Technical Specification” (2015 edition).
The reporter of “Daily Economic News” noted that the acrylamide contained in the batch of products exceeded the standard, and the test result of the rain cleaning anti-dandruff shampoo (deep dandruff) with a capacity of 400ml/bottle was 1.104mg/kg, and according to the “Cosmetics Safety Technical Specifications” (2015 edition), polyacrylamide is a restricted substance in cosmetics, and when it is used in resident products, the maximum residue allowed in the product is 0.1mg/kg; However, when used in other products, the maximum residue of acrylamide is 0.5mg/kg.
The Shanghai Food and Drug Administration said that the relevant district market supervision bureaus have taken control measures against unqualified products in accordance with the law, and carried out investigations and disposals of corresponding manufacturers in accordance with the law, requiring enterprises to suspend production and sales and recall unqualified products in a timely manner. At the same time, the sampled units are required to strictly follow the “Regulations on the Management of Evidence and Receipts and Ledgers of Cosmetics Production and Trading Enterprises”, further strengthen quality management, and ensure the traceability of business product quality.
At noon on June 13, Lafang Jahwa issued an announcement that the company will immediately send a letter to all dealers and actively recall all the above-mentioned problematic batches of Yujie dandruff shampoo (deep dandruff) products without reason, and will immediately send Yujie shampoo products for inspection, and entrust authoritative third-party testing agencies to inspect the relevant series of products of Yujie shampoo.
The revenue of problem batch products is relatively low
According to public information, Lafang Jahwa was established in 2001, and has a number of daily chemical brands such as “Lafang”, “Meiduosi” and “Yujie”, and in March 2017, Lafang Jahwa was successfully listed on the A-share market. On April 20 this year, the company released its first annual report since listing. According to the annual report data, its operating income in 2017 was 981 million yuan, a year-on-year decrease of 6.47%; The net profit attributable to the owners of the parent company was 138 million yuan, down 7.64% from the same period last year; Net profit attributable to shareholders of listed companies after deduction was 123 million yuan, down 12.33% from the same period last year.
As for the reasons for the double decline in net profit in the first year of listing, the company said that it included many factors such as the increasingly fierce competition in the daily chemical industry, the vigorous development of emerging formats such as online retail, and the rise in raw material prices. In addition, Lafang Jahwa is facing the challenge of high inventory, and its 2017 annual report shows that the inventory of its creams, conditioners, shampoos, gel water and gel creams increased by 340.95%, 81.08%, 64.77% and 77.37% respectively over the same period of the previous year. By the end of 2017, the carrying value of its inventory goods reached 113 million yuan, an increase of 35.9492 million yuan from the beginning of the year.
However, according to the first quarterly report of Lafang Jahwa this year, the operating income during the period was 221 million yuan, down 5.94% year-on-year; The net profit attributable to the parent was 44.9423 million yuan, a year-on-year increase of 31.94%; The net profit attributable to the parent after deduction was 36.7289 million yuan, a year-on-year increase of 9.79%.
According to the announcement of Lafang Jahwa, the sales revenue of this batch of Yujie anti-dandruff shampoo (deep dandruff) was about 22,300 yuan, accounting for about 0.0023% and 0.0101% of the company’s main business income in 2017 and the first quarter of 2018. In 2017 and the first quarter of 2018, the overall sales revenue of Yujie Anti-dandruff Shampoo (deep dandruff) was about 3.286 million yuan and 1.0175 million yuan, respectively, accounting for 0.3349% and 0.4606% of the company’s main business income in the current period. The company said that the sales revenue of this batch of products accounted for a low proportion of the company’s main business income, and the recall had no significant impact on the company’s production and operation and financial status.
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