Recently, Dongfang Jincheng downgraded the long-term credit rating of jinchang Construction Investment Company from AA- to A+, and the rating outlook is stable. It is understood that in recent years, Jinchang Jiantou has continuously expanded its scale through new subsidiaries. At the same time, however, in the past three years since 20 18, the total profit of Jinchang construction investment has continued to decline and the debt ratio has increased year after year. What are the advantages and disadvantages behind the expansion of Jinchang Jiantou?
Profit decline VS scale expansion
Tianyancha platform shows that Jinchang Jiantou is a wholly state-owned company established in June 2005, with a registered capital of 3130,000 yuan by the end of June 2020. Calculated by registered capital, at the end of the same period, the shareholding ratio of CDB Development Fund Co., Ltd. (hereinafter referred to as "CDB Fund") was 665,438+0.6%, and the shareholding ratio of Jinchang Government was 38.40%.
According to the operating data from 20 18 to the first half of 2020, the revenue of Jinchang construction investment increased year by year, reaching 4180,000 yuan, 67 10/0,000 yuan and 789 million yuan respectively. However, with the increase of revenue, the total profit of Jinchang Jiantou has been declining in the past three years, which are 32 million yuan, 24 million yuan and -3 1 10,000 yuan respectively.
It is worth noting that Jinchang Jiantou has continuously expanded its business scale in recent years, but it has not brought considerable benefits to it.
By the end of 20 19, the planned total investment of key infrastructure projects under construction of the company was 3.559 billion yuan, and the investment gap was still 135438+0 billion yuan. Dongfang Jincheng pointed out in the evaluation report that the company's infrastructure projects under construction have a large investment scale and face certain capital expenditure pressure. As the company did not provide the income calculation data and corresponding financing details of key infrastructure projects under construction, Dongfang Jincheng could not judge the fund balance of the above projects.
In addition, Jinchang Jiantou has also added a number of allocated secondary subsidiaries, among which Jinchang Cement (Group) Co., Ltd., Jinchang Jinyu Grain Purchase and Sale Reserve Co., Ltd., Jinchang Jinhe Grain and Oil Trading Co., Ltd. and Jinchanglong Jingshan Cemetery have not completed industrial and commercial changes as of the date of issuance of the above report. For a number of new subsidiaries, Dongfang Jincheng believes that "the company's ability to control the newly acquired distributed subsidiaries needs to be improved."
As the above-mentioned city investment people said, the new subsidiary has also greatly increased the debt of Jinchang Jiantou. At the end of 20 19, with the expansion of the scope of merger, the total debt of the company increased by 247% year-on-year. Among them, short-term interest-bearing debt accounts for 14.95%. At the end of the same period, the company's asset-liability ratio and capitalization rate of all debts increased significantly year-on-year due to the sharp decline in the company's owner's equity and the large-scale new liabilities and interest-bearing debts brought about by the expansion of the merger scope. In this regard, Dongfang Jincheng believes that considering that the company's projects under construction still need large-scale investment, it is expected that the debt scale will further increase in the future.
The debt ratio is increasing year by year.
Oriental Jincheng rating report shows that by the first half of 2020, Jinchang Jiantou had total assets of11660,000 yuan, total liabilities of 6.725 billion yuan, net assets of 444 1 100 million yuan, and asset-liability ratio of 60.23%. It is worth mentioning that the report also mentioned that "since 20 19, the financial leverage level of Jinchang Jiantou has risen sharply, and its liabilities and debt ratio have soared. Considering that the projects under construction still need large-scale investment, it is expected that the debt scale will further increase in the future. "
At the end of 20 19, the company's monetary funds included bank deposits14.57 million yuan and other monetary funds of 93 million yuan; Other receivables of the Company are mainly current payments and deposits. Among the defaulting units, due to the cancellation of Jinchang China Railway Modern Logistics Co., Ltd., Gansu Jinchang Chemical Group Co., Ltd. was insolvent, and * * * set aside 0.5 1 billion yuan for bad debts. Dongfang Jincheng believes that overall, there are certain liquidity risks in other receivables of the company.
Judging from the debt structure, Jinchang Construction Investment Co., Ltd. mainly has non-current liabilities, accounting for 65% of the total liabilities, and the debt structure needs to be optimized. By the end of June this year, Jinchang Jiantou had non-current liabilities of 4.352 billion yuan, mainly long-term loans; Current liabilities are 2.374 billion yuan, mainly notes payable and accounts payable, and its short-term liabilities due within one year are 328 million yuan. Overall, Jinchang Construction Investment's interest-bearing liabilities are 4.674 billion yuan, mainly long-term interest-bearing liabilities, and the interest-bearing liabilities account for 70%.
It is worth noting that this downgrade is not the first time, and similar problems have been mentioned before. 2065438+In August 2008, Dongfang Jincheng announced that it decided to maintain the credit rating of Jinchang Jiantou as AA-, and the rating outlook was adjusted to negative. Dongfang Jincheng believes that during the tracking period, the company did not engage in infrastructure construction business on 20 17, and there are no planned projects for the time being, and the franchise in this business field has been greatly weakened; The company's operating cash flow still depends heavily on fluctuating pig iron smelting sales and current payment, and there is still some uncertainty.
Will Jinchang Jiantou choose industrial transformation because of the risks brought by poor profitability and soaring debt? According to the analysis of the assessment report of Oriental Jincheng, the supervision of hidden debts of local governments will continue to maintain a high-pressure situation in 2020, and the main way to control debt increase will be to drive local government financing from dark to bright through local debt expansion; On the other hand, it is expected that the city investment company will continue to explore new repayment modes on the basis of "exchanging time for space" and smoothing the debt cycle. While implementing national laws and meeting policy requirements, city investment companies still have many problems, such as single principal-agent type, many public welfare projects, large accounts receivable and weak asset liquidity. Its current situation can no longer meet the development needs, and it is expected that the necessity of business transformation will continue to rise in 2020. City Investment Company will continue to accelerate its business transformation, and its operating assets and income will continue to increase. The city investment company will gradually transform from a local government investment and financing platform to a market-oriented integrated urban operator or other state-owned investment and development entities.