Chapter 310 - 157: High In, High Out (Part 2)

Chapter 310: Chapter 157: High In, High Out (Part 2)

If his younger uncle hadn’t kept a tight grip on procurement himself, that woman would have likely run the tea restaurant and roasted meats shop into the ground.

Jiang Miao had always kept such bizarre relatives at a distance. After all, their goal wasn’t to help manage the company; it was to leech off a wealthy enterprise. It would be one thing if they just wanted to come to the company and act like they owned the place; what was worse was the fear they would line their own pockets and betray the company from within. On top of that, they loved to use guilt trips, constantly spouting lines like, "I’m only doing this for your own good," or, "You can’t trust outsiders."

Jiang Miao knew you couldn’t trust outsiders, of course, but it wasn’t as if relatives were much more trustworthy.

Besides, non-family employees were easier to deal with. You could use harsh measures to deter them, or even get them arrested. Relatives, on the other hand, were a headache. Many would leverage their family connections to embezzle funds and take kickbacks even more brazenly.

Currently, within Hailufeng Company’s management, his only relatives were his sister and brother-in-law. No other relatives held positions in middle or upper management. A small portion of his distant relatives from Xinxiang worked in basic positions like security, farm labor, or as drivers—all non-critical roles.

Before he knew it, the pickup truck had returned to the temporary headquarters of the Nanhu Experimental Zone.

The company was staggering employee holidays for the Qingming Festival, so the experimental zone seemed a bit deserted.

Just as Jiang Miao got out of the car, he saw Ye Meijing coming down from the second floor.

"Boss! I was just about to look for you at noon to give my report."

"Something came up unexpectedly, so I came back. Are you free now? If so, come to my office and we can go over last month’s financials."

"I’m free."

「In the chairman’s office on the third floor.」

Li Zixuan made tea for the two of them.

"Boss, our expenses for this past month were a bit high."

Jiang Miao was flipping through the financial report.

Ye Meijing glanced at her small notepad from time to time and continued, "The company’s revenue for March was 2.1 billion yuan. Besides the relatively stable revenue from our existing business lines, the new growth came mainly from feed and fish products, as well as patent fees."

As he read the financial report, Jiang Miao was looking at the March revenue breakdown for each major business line.

Eel fry: 432 million yuan.

White Truffle: 342 million yuan.

Fish Products: 634 million yuan.

Fish Oil: 3.17 million yuan.

Fruit: 8.25 million yuan.

Brick-and-Mortar Stores: 14.08 million yuan.

Dairy Products: 36.71 million yuan.

Patent Fees: Egyptian Catfish Meal patent, 384 million yuan (paid by Haida Group for Q1); patent for earthy-flavor-free Egyptian Catfish, 148 million yuan (paid by Guotai Food Factory for March).

Total monthly revenue: 2.00261 billion yuan.

"As for expenses, in addition to the company’s fixed operational costs of 470 million yuan, March saw new procurement expenses of 430 million, investment expenditures of 280 million, and engineering expenses of 170 million, for a total expenditure of 1.35 billion yuan."

The precise total expenditure was 1.35763 billion yuan.

In other words, even with Hailufeng Company’s massive investments over the past few months, the company still turned a profit of 640 million yuan in March.

Of course, the core reason for such high gross profits was the 530 million yuan in patent fees.

And as other domestic feed manufacturers’ Egyptian Catfish Meal operations entered the production phase, the related patent fees for the second quarter were expected to reach a new high.

However, the patent fees from Guotai Food Factory had likely reached their peak. Their production lines were already maxed out. Between them and Hailufeng Company’s own fish products, the two companies were churning out 80,000 to 100,000 tons of fish balls, fish fillets, fish cakes, fish sausages, and canned fish every month, and the domestic market was nearing saturation.

Fortunately, the March expenditures weren’t regular, fixed costs. Things like purchasing agricultural machinery, engineering equipment, and construction projects were all one-time investments. Expenses in these areas would drop significantly in the coming month.

Of course, a drop didn’t mean there would be a major reduction in investment spending overall.

For instance, according to the financial budget report Jiang Miao was currently reviewing:

Hero Dairy was requesting that the parent company approve the purchase of 100,000 first-lactation dairy cows by the end of the year, with an estimated procurement cost of 1 billion yuan.

At the same time, Hero Dairy was also requesting another 1 billion yuan to invest in building modern dairy farms, milk processing plants, and other supporting facilities.

With a total requested budget of 2 billion, even if spread out monthly, it would still amount to around 230 million per month—a considerable expense.

Another department with a large budget request was the Gannan Branch. They were applying to purchase 500 units of the newly developed small-scale camellia fruit harvesting machine at 28,000 yuan per unit, for a total of 14 million yuan.

Including the other agricultural machinery and supporting equipment needed by the Gannan Branch, the total required funding came to 57 million yuan.

Jiang Miao had Li Zixuan bring him the detailed documents for these budget requests. He spent over two hours carefully reviewing them before completing his initial assessment.

Although the expenditures were massive, they were all necessary for Hailufeng Company.

The financial pressure wasn’t too great. After all, Hailufeng Company’s core business lines were extremely profitable, and when combined with the patent fees, they could easily support all the investments.

Even with Jiang Miao spending money like water, the company still had a surplus of nearly 1.9 billion yuan on its books.

Moreover, after paying his personal income tax last year, Jiang Miao had transferred a full 1.2 billion yuan into his personal account. His private account currently held a balance of 1.57 billion yuan.

And that wasn’t even counting the secret offshore anonymous account he controlled, which held nearly 86 million US dollars.

Therefore, with a flourish of his pen, he approved the budget requests from all departments, subsidiaries, and branches.

’Besides, if I don’t spend it, the company will just have to pay taxes on the profits. Hailufeng Company has received nationwide tax breaks, but that doesn’t mean we’re completely exempt. Some taxes are unavoidable.’

’Right now, Hailufeng Company is recognized as a high-tech enterprise in a designated industry, entitling it to a 50% reduction on all national taxes starting this year. Plus, local governments can offer a second round of reductions based on their own policies.’

’Take Hailufeng’s operations in Shanmei for example. After all the cumulative reductions, this year’s tax rate is about 11.3% of the gross profit.’

’In the Gannan Region, it’s 8.9% of gross profit, while in places like Qiongzhou and Monan, it’s 17.8%.’

Even though the tax reductions were substantial, Jiang Miao still decided to spend more money and expand investment in various projects.

’After all, Hailufeng Company’s profits were about to experience a second explosive growth spurt.’

’Whether it was the initial production of the Vanilla Strawberry Powder, the soaring patent fees, or the Monan soybean harvest in October, all of these would continuously drive up the company’s various revenue streams.’

’With the company’s finances in such great shape, if he didn’t spend aggressively now, what was the point? Was he just going to let the money sit there and collect dust?’