Zhan Chunxin explained Zoomlion's chess game in detail at the shareholders' meeting
with the end of the first half of the year, Zoomlion's share repurchase plan came to an end. According to the company's announcement on June 30, a total of 38845100 shares were repurchased this time, with a total investment of 169520900 yuan. If the repurchase highlights the firm optimism of listed companies about their own value, how does Zoomlion, as one of the industry leaders, view the recovery of the industry, how to adjust the asset structure, and how to plan for future development? In this regard, zhanchunxin, chairman and CEO of Zoomlion, and the company's management gave detailed answers at the recent annual shareholders' meeting
talking about the judgment on the recovery trend of construction machinery industry 8 The oil collector of the oil pump in the spring change experiment is not pressed on the pump body. Zhan Chunxin, now 62, may have the most say. Although he is still cautious and optimistic, he has also made it clear that the lowest point of the industry has passed. As for Zoomlion's recent transfer of environmental control system software to adopt the Chinese Windows 7 platform with RMB 11.6 billion, Zhan Chunxin's logic is to achieve "light loading" with the help of investment income. This is also the necessary preparation for Zoomlion to make up for the weaknesses in relevant business areas through international mergers and acquisitions in the next step and become a truly international enterprise
the industry will not fluctuate greatly
in the past six months, various judgments and voices have been made around the recovery of the construction machinery industry. So, how long can this recovery of the industry last
Zhan Chunxin spoke about this at the shareholders' meeting held by Zoomlion last week. First of all, he made it clear that the lowest point of the construction machinery industry has passed, "the most difficult time should be the middle of last year"
however, he is still cautiously optimistic: "at present, the real estate is under regulation, and PPP is not as stimulating to the construction machinery industry as expected. The market is still in a normal state, and there will be no big ups and downs. The first half of the year will be better, and the second half will fall down a little. It will be relatively stable."
so, where is the imagination space in the next few years? Zhan Chunxin said that he is optimistic about the measures such as xiong'an new area to promote coordinated regional development and solve the "big city disease", and the new urbanization will continue to open up new space
in contrast, Zoomlion, after two years of difficulties, the company's first quarterly report on starting the beam motor in May this year has shown "spring", and the revenue of the construction machinery sector has increased by more than 100% year-on-year, driving the overall revenue in the first quarter to increase by 74.45% year-on-year to RMB 5.275 billion, and the net profit after deducting non-profit has also changed from RMB -692million in the same period last year to RMB 66.11 million. Among the segments, the sales volume of Zoomlion's concrete mixer truck and truck crane in the first quarter increased by more than 200% compared with the same period last year
Zhan Chunxin also mentioned that Zoomlion's revenue forecast in 2017 will be higher than that in 2016. According to the annual report, Zoomlion's revenue from 2014 to 2016 was generally stable, about 25.8 billion yuan, 20.7 billion yuan and 20billion yuan respectively
however, it is obvious that the construction machinery industry has rebounded strongly for the time being
the report released by S & P global rating in April this year also shows that after several years of downturn, the market demand of China's construction machinery industry is expected to recover. It predicts that the sales of the industry in the next 24 months will increase by 5% to 10% compared with 2016, but still only about 50% of the peak in 2011At the shareholders' meeting, Zoomlion proposed to transfer 80% of the equity of Changsha Zoomlion Environmental Industry Co., Ltd., a wholly-owned subsidiary, to Yingfeng holdings and other four parties (Zoomlion retains 20% of the equity) at the price of 11.6 billion yuan, which was passed by a high vote
in this regard, many small and medium-sized shareholders once felt "regrettable". How did the "troika" of engineering machinery, agricultural machinery and environment that the company once favored become "two wheel drive"
Zhan Chunxin said that he thought environment was a good industry in the past, but now he still thinks so. Why sell it? At the shareholders' meeting, Zhan Chunxin summarized the logic of this asset adjustment as follows: originally, there were three cards in his hand, and all of them needed to be developed. "But if there are problems, who should be the first to consider in the three pieces? When resources cannot be allocated, it is most appropriate to cut off the environmental plate, which is also conducive to the future development of the environmental plate."
Zhan Chunxin's consideration is obviously based on his overall judgment on the future trend of construction machinery and other industries. In the "three cards", construction machinery is the absolute main business and foundation of Zoomlion, and naturally will not be sold; Agricultural machinery, according to Zhan Chunxin, "has development prospects but it is not yet time", is still cultivating large and medium-sized enterprises; As for environmental sanitation machinery, Zoomlion has grown from hundreds of millions to tens of billions, and the selling price is estimated to be good. The follow-up development also requires the involvement of a third party with environmental project operation and maintenance experience
"focusing on construction machinery and agricultural machinery will certainly make a great and strong enterprise, which is enough for Zoomlion." Zhan Chunxin emphasized
the "financial bath" and "light pack" of accounts receivable
the sale of shares in the environment sector also has a more realistic role - helping "financial bath" and "light pack"
with this transaction, Zoomlion will obtain 11.6 billion yuan in cash and bring billions of yuan in revenue. This extra profit will be well applied - according to Zoomlion's disclosure at the shareholders' meeting, the risks, pressures and burdens of the company's accounts receivable for so many years will be effectively solved
compared with other construction machinery enterprises, Zoomlion lacks the support of the parent company group in recent years, especially in the disposal of accounts receivable. According to the annual report, as of december31,2016, Zoomlion had more than 30billion yuan of accounts receivable and nearly 15billion yuan of financial leasing accounts receivable, totaling more than 45billion yuan, and more than 3 billion yuan of bad debt reserves were accrued
in short, Zoomlion does not need too large single year net profit data in 2017 (reflected by the sale of equity in the environment sector). What the company wants is to take the opportunity to "take a financial bath" and solve the historical burden of these years. The accrual of this accrual and the resale of this resale can be carried out in order to "go to the battle with light weight"
what does it look like after "light up"? In fact, "the net interest rate of the construction machinery sector is stable at 10% to 15%, while the company's annual revenue is more than 20billion yuan." Zhan Chunxin said. Based on this calculation, the profit scale of about 2billion yuan should be very "beautiful" for Zoomlion
and then? Will the burden of receivables swell again
in this regard, the S & P report points out that the credit sales strategy used by construction machinery manufacturers in the past to strive for market share has been greatly reduced. In the past few quarters, the operating cash flow level of the construction machinery industry has gradually improved, mainly due to the improvement of the quality of accounts receivable, stricter customer credit standards and credit control, and more emphasis on cash income rather than sales growth. According to the report, if the construction machinery enterprises can continuously manage the working capital, a significant deleveraging may occur after 2018
the way to invest 300 million yuan and output 100 million yuan should not be
this problem may be what Zhan Chunxin has been thinking about in recent years
learning from the bitter experience, Zhan Chunxin bluntly said that the way in the past "should not be": in the past, domestic construction machinery enterprises invested 300 million yuan and may only produce 100 million yuan of income. Moreover, there are various collection risks in this output
Zoomlion has rich experience in "going global" in recent years. What is it like abroad? Zhan Chunxin said that the input-output ratio of this foreign industry is 1:1, and the construction machinery market tends to be stable
"in this context, Zoomlion needs to think more about how to develop." Zhan Chunxin said
he probably has the answer. According to his description, Zoomlion will first become a "light-weight, low-risk and stable enterprise", continue to expand engineering machinery, cultivate and tap the agricultural machinery and agricultural service market, and complement the weaknesses in relevant business fields through international mergers and acquisitions, so as to stand firm in the international market and become a truly international enterprise
"money is in our hands. We are not willing to exchange three hundred million yuan for one hundred million yuan. To realize our international strategy, it is possible that through a good acquisition, the domestic weakness will be made up and we will stand firm internationally. We have never given up tracking the relevant target companies." Zhan Chunxin said
the authenticity of this information is not verified by China Construction Machinery Information certificate. PHA is compared with other degradable materials. It is only for your reference. Please do not reprint without permission. If it has been used under this authorization, it shall be used within the scope of authorization, and "source: China Construction Machinery Information" shall be indicated