Kunpeng Project
Huaxia Fortune is in a debt crisis, the left hand is "cashing off", the right hand is overdue, how far does it take to go ashore?
Author |Planet.
Bedo Finance. In 2024, Huaxia Happiness is still not so "happy".
China Fortune Foundation (600340) (hereinafter referred to as "China Fortune") recently announced the overdue debt and the progress of debt restructuring. According to the announcement, as of January 31 this year, Huaxia Fortune has been unable to repay the loan on time, totaling 2441.5 billion RMB.
After becoming the biggest dark horse in the real estate industry, Huaxia Fortune has laid a solid foundation in the new industrial city with a perfect industrial park, and has also experienced glorious years, but in the end it was defeated by crazy expansion. Even after the company's liability structure was announced in 2021, they did not give up the opportunity to find a solution.
But even so, Huaxia Happiness, which is in crisis, has to "turn the tables against the wind", and there are still many problems to deal with.
First, real estate stocks have sprung up, and emerging industrial cities are hiding murderous opportunities.
According to the information, Huaxia Fortune was established in 1998 and is the first listed company in China. Gu'an Industrial Zone is an important development area in Hebei Province and is a model between cities.
According to statistics, as of 2019, China Fortune has introduced more than 600 enterprises in Gu'an Park, attracting nearly 140 billion yuan. Driven by the "new industrial city", Gu'an County has leapt from the "last" rural area in Hebei to the "top 100 counties", and its tax revenue has increased from 110 million yuan in 2002 to 9.6 billion yuan in 2019.
With the development of the new city, China Fortune has quickly won the attention of the state. Since then, the company has developed Chaobaihe Dachang Industrial Park, and based on Beijing, it has expanded the business scope of the enterprise, and undertook the development, construction and operation of a comprehensive park with a new model and a new model.
In 2011, ST Guoxiang was listed in Shanghai, and Huaxia Fortune made great progress, with a cumulative sales of 1203 in 20162.5 billion, an increase of 66 over the same period last year43%, is currently the only domestic enterprise to enter the 100 billion city, and shows a good momentum.
It is worth mentioning that before the IPO, all the revenue of China Fortune came from Beijing. Huaxia Happiness is not willing to be trapped in this land, so it has expanded on a large scale in Beijing, 96% in 2014, 69% in 2018, and 51% in 2020.
So far, China Fortune has formed more than 10 central cities centered on Beijing, Shanghai, Guangzhou, Nanjing, Hangzhou, Zhengzhou and Wuhan, and formed a business network of more than 80 cities around the world.
Among them, Huaxia Fortune has carried out a more in-depth study with the state in the way of "utilizing PPP". In this way, China Fortune takes infrastructure construction, public services, municipal operations, etc. as the main content, undertakes the investment, construction and operation management of the project, and links the investment income with the performance.
The use of developmental PPP has played a role in promoting the integrated development of urban agglomerations, industries and cities, so that enterprises can not only bear risks but also obtain long-term benefits. But in the same way, such a development method also requires a lot of capital and a long investment, and if the investment fails, or exceeds expectations, it is likely to lead to an "industrial empty city".
Second, the purchase restriction policy has been restricted, and the consequences of blind expansion are very serious.
Since 2017, China Happiness has ushered in a turning point in its life. The sales revenue of Huaxia Fortune Real Estate fell by 18 percent from the same period last year22% to 2893.1 billion, while the performance of real estate sales in Beijing fell by 458 in the same period62%, and the inventory turnover rate is also lower than the average for the real estate industry.
After the release of Huaxia Fortune's annual report, the Shenzhen Stock Exchange issued the 2017 annual report and asked Huaxia Fortune to answer 18 questions, explaining the reasons for the decline of its real estate business, the scalability and replicability of the new industrial city, the financial situation and the sustainability of the financial business, and the debt situation.
At this time, it was reported that Peacock Villas, a subsidiary of China Fortune, was ready to sell all its properties or trade with other companies. According to a person familiar with the matter, most of the real estate in Peacock Villas is on sale, and most of them are in units of 10,000 yuan.
In order to solve the problem of financing difficulties, China Fortune introduced Ping An in April 2018, and the two parties signed a contract on the performance growth rate of China Fortune in the next three years not less than three years, that is, the annual net profit is not less than 1141.5 billion yuan, 1448.8 billion yuan and 18 billion yuan.
Under the contract, if the net profit of China Fortune in any given year falls below its promised profit margin of 95%, it will pay a sum of cash to Ping An. Huaxia Bank, which barely "stepped on the line" in 2020, will have a net profit of 36 in 20206.5 billion, only 20 percent of the promise36%。
In 2021, Huaxia Happiness will appear 390 for the first time3 billion losses. Net cash flow from operating activities was -26$4.6 billion; In the same period last year, the company's total sales volume was 2816.8 billion yuan, a decrease of 70 from the same period last year06%。The company has a gearing ratio of 9460%, 13 percent higher than last year31%。
On the issue of asset liquidity, China Fortune passed a debt restructuring plan at the end of 2021, of which 219.2 billion yuan of debts will be repaid in the form of ** asset recovery funds, ** asset purchase assets to take away financial debts, extension or repayment of senior financial debts, cash payment or repayment of debts with trust beneficiary shares.
Wang Wenxue, chairman and CEO of China Fortune, also admitted at an internal meeting that he was "too ambitious and too impulsive." He said that because of a mistake in judgment, Huaxia Fortune will continue to increase the construction of new industrial cities and related housing in Beijing in the coming period, but under the "purchase restriction order", the real estate ** and transaction volume in the Beijing area have declined sharply, which has caused the real estate industry to "cut the waist", thus causing the company's cash flow crisis.
Third, twice in arrears, financing has become a big problem.
According to the reorganization plan announced by China Fortune, it is expected to complete the vast majority of its liabilities by 2022, and the previously released figures also show that it has carried out debt restructuring in the form of contracts and other forms, totaling 1,8756.5 billion yuan, accounting for 856%, but by the end of 2023, there are signs of defaulting on debt.
According to financial information, the amount required for China Fortune to repay all creditors in overseas debts by 2024 is 18%, but shareholders reported that they only got about 055% of the funds, less than 1 3. Its reason was that "technical problems" led to the reimbursement of this part.
China Fortune has signed a debt restructuring agreement with Zhongrong Trust, extending the five-year period to 2027. However, the company failed to repay the principal amount of 4660 within the agreed period9,500 yuan, which has already violated the contract.
One side is the principal, the other side is the investment income, and if China Happiness wants to turn over, I'm afraid it's not that simple. In fact, in the past few years, Ping An Group has also vigorously promoted debt restructuring, and released an "Additional Plan" in September 2022 to build two asset-light service platforms, "Happiness Selection" and "Happiness Selection", to repay financial and operational liabilities.
In December 2022, China Fortune sold several properties, including Gu'an Industrial Port Investment*** and Gu'an Industrial Development Education Investment***, totaling 99.9 billion yuan, and sold its South China headquarters assets to China Resources Real Estate for 12.4 billion yuan.
It is understood that the relevant personnel of the above transaction said that the transfer of projects includes Wuhan Yangtze River Center, Wuhan Zhongbei Road and Nanjing's large playground, all of which have a total investment of 198 since Wu Xiangdong, president of China Resources Group, served as CEO of China Fortune7.4 billion RMB. This means that this auction will have a 60% discount.
However, due to the height restrictions of the construction of the Nanjing project and the planning problems of the Wuhan project, the payment process of the project was delayed. China Fortune only received the first equity transfer from China Resources Real Estate, with an amount of up to 27500 million, it is difficult to achieve new income**, which is also a problem faced by its capital turnover.
Fourth, strive to save yourself, and it is expected that it will still be in a state of loss in 2022.
In accordance with the "redemption" clause in the "Debt Restructuring Plan", China Fortune issued a letter on January 25 regarding the 100% equity of its subsidiary Yunuojin (Gu'an) Information Consultant *** hereinafter referred to as Gu'an Information Consultant) and 11 target enterprises totaling 255$8.4 billion of self-benefit trust.
It is reported that Huaxia Bank will repay 1 yuan of the above bonds at the ratio of 1 yuan, as the company will provide up to 240 yuan to other creditors0.1 billion yuan of loans. The trust shares, which have not yet been used to repay debts, remain in the hands of Guan Information Consultants.
According to the latest announcement of China Fortune, in the "Debt Restructuring Plan" of China Fortune, 219.2 billion yuan of creditor's rights were restructured in the form of contracts, with a total amount of 1885700 million, accounting for 8603%。
China Fortune repaid its financial and operating liabilities through the "Happy Preferred Platform" established by its subsidiaries, totaling 1601.7 billion yuan, correspondingly, the relevant creditors got 2697% of the shares; The total operating liabilities of the "Happy Choice Platform" and the "Happy Preferred Platform" were 534.1 billion.
From the disclosure of the last litigation and arbitration incident to January 31 this year, the total amount of litigation and arbitration involved in the litigation and arbitration of China Fortune was as high as 18$2.9 billion. The company said that the lawsuit is still ongoing, and the final conclusion has not yet been determined, so it is not yet certain what impact this will have on the company's current and future earnings.
At the same time, according to the financial report released by China Fortune, the company expects a loss of -90-63 billion yuan in fiscal year 2022; The net profit after deduction was -11.3 billion to 9.9 billion. And in 2022, the performance of these two projects is: 158.3 billion, -1648.9 billion.
Huaxia Fortune said that this performance** is a loss, because the company will sell a batch of assets with high liquidity in 2022, resulting in corresponding losses. At the same time, the company's debt is still very large, but the current interest rate is very low, which keeps the company's financial expenditure at a high level.
China Fortune adheres to the business philosophy of honesty and trustworthiness, takes the initiative to deal with the existing problems, fulfills the management responsibilities of the enterprise, and reasonably disposes of them on the basis of "not evading debts" and in accordance with the principles of marketization, rule of law, fairness and justice, and classified disposal, and protects the interests of creditors in law.