Wuliangye Yibin Co.,Ltd. reported significant financial restatements. On April 30, the company released its 2025 annual report and 2026 first-quarter report, disclosing comprehensive operational results. Concurrently, it issued a correction notice for prior accounting errors and updated financial statements. Additionally, Wuliangye announced a share buyback plan totaling 8 to 10 billion yuan.
The 2025 annual report revealed company revenue of 40.529 billion yuan, a decline of 54.55% year-over-year. Net profit attributable to shareholders was 8.954 billion yuan, down 71.89%. For profit distribution, the company proposed a cash dividend of 25.78 yuan per 10 shares based on 3.882 billion shares, without bonus shares or capital reserve conversions.
In Q1 2026, Wuliangye reported revenue of 22.838 billion yuan, increasing 33.67% year-over-year. Net profit reached 8.063 billion yuan, up 82.57%. The company attributed the improvement to a low base effect from the same period last year.
Regarding 2025 performance, Wuliangye explained that the baijiu industry entered a deep adjustment cycle, with contracting consumption scenarios and intensified competition leading to sales declines and temporary inventory buildup, impacting revenue.
The company also issued revised reports for Q1, H1, and Q3 2025, retroactively reducing previously disclosed quarterly data. Revenue for the first three quarters was adjusted down from 60.945 billion yuan to 30.638 billion yuan, while net profit was revised from 21.511 billion yuan to 6.475 billion yuan, decreases of approximately 50% and 70% respectively.
In its accounting error correction announcement, Wuliangye stated that based on a review of 2025 business models and prudence principles, it adjusted revenue recognition for certain operations. The company clarified that these corrections would not alter profit/loss nature in disclosed annual reports nor result in negative net assets.
Alongside the financial reports, Wuliangye unveiled a repurchase plan to buy back shares via centralized bidding, using 8-10 billion yuan at prices not exceeding 153.59 yuan per share, aiming to reduce registered capital.
The delayed reports stunned investors, provoking confusion and disbelief. The accounting corrections effectively rewrote 2025 financials: Q1 revenue was revised from 36.9 billion yuan to 17.1 billion yuan, net profit from 14.86 billion yuan to 4.4 billion yuan, and sales volume from 27,000 tons to 8,654 tons.
This comprehensive restatement raises fundamental questions about data authenticity. If pre-revision figures were false, how were they originally approved? Are earlier years' data reliable? The incident undermines investor confidence in market transparency.
Despite regulatory emphasis on investor protection, such discrepancies occur. In U.S. markets, similar cases might trigger delisting. The situation echoes economist Wu Jinglian's description of A-shares as a casino.
Value investors face challenges when financial statements lack continuity and credibility, rendering valuation models meaningless. Wuliangye's revisions particularly harm long-term investors who rely on accurate disclosures.
While exiting the A-share market seems tempting, alternative investments like real estate, gold, or Bitcoin present their own risks. International markets offer opportunities but accessibility barriers remain.
Given the uncertainty, investors might disregard volatile 2025 data and focus on historical trends and recent quarterly reports. Historically, Wuliangye's Q1 profit represents about 40% of annual profit. Thus, the 8.063 billion yuan Q1 2026 profit suggests full-year profit around 20 billion yuan, aligning with conservative estimates.
The 10-billion-yuan buyback could enhance shareholder value by 2.5%. If dividend payout reaches 70% of net profit, a 100-yuan investment would yield 3.8% annually, comparable to risk-free rates.
The key concern is whether Wuliangye's brand reputation will suffer, affecting future operations. However, baijiu consumers typically aren't influenced by capital market events.
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