American Apparel Cash Flow Risks Facing

2012 is still a test year for American Apparel.

The huge amount of money needed to pay in the short term and the high inventory level test the ability of American state clothes.

Short term debt 3 billion 600 million yuan

According to reporters, March 8th

According to the announcement of the US bond dress, the two short-term financing bonds were issued in 2011, the total amount of financing was 1 billion yuan, and the current interest rates were 5.2% and 5.28% respectively.

That is to say, in only two months in March and April, the United States should pay nearly 1 billion 100 million yuan for costumes.

Correspondingly, the liabilities of Smith Barney clothing remain high.

According to the three quarterly report of 2011, the company's liabilities totaled 5 billion 472 million yuan in the third quarter of 2011, an increase of 12% compared with the same period last year.

In the context of high debt levels, the financing structure of American bond apparel is more worrying for the industry.

The financial institutions found that in the high liability of American bond apparel, short-term debt amounted to 3 billion 600 million yuan, accounting for 97.31% of the total debt, and short-term financing became the main way of American bond financing.

In the issuance of short term financing bonds, Smith Barney disclosed that its bank credit limit amounted to 4 billion 305 million yuan, of which 1 billion 891 million yuan was not used.

In this regard, industry analysts believe that, although relatively long term financing, short-term financing needs to pay lower interest rates, will reduce the operator's financial costs, but for the United States and the United States, such a high short-term debt can not only ease the tension of its funds, but because of the endless short-term debt maturity exacerbate the pressure of short-term turnover of funds.

Xu Yan, an analyst at CICC, said that according to the 2011 China Daily's report, credit loans amounted to 2 billion 200 million in the 3 billion 200 million yuan loan, accounting for about 2/3, which is obviously higher in private enterprises.

On the whole, because of too much debt concentrated in the short term, the turnover pressure of Mei Bang dress is really large.

"Short-term problems will inevitably bring long-term hidden dangers, not to mention their financial costs."

The financial institutions said that.

The latest financial data released by Smith Barney show that since 2011, the interest expense of American Apparel has been constantly increasing.

"This is equivalent to 3 yuan per earned, and 1 yuan will pay interest."

Liu Qing, product design manager of the trust investment company limited, told reporters.

The sharp increase in interest payments in 2011 is closely related to monetary tightening.

In 2011, the government tightened monetary policy in order to regulate and control real estate, and the cost of bank loans rose sharply.

In this case, the financing cost and loan cost of enterprises are rising, and the increase in interest expense is not surprising.

The high storage problem of American barrack seems to bring more pressure on its capital turnover.

Inventory of over season products amounted to 1 billion 500 million yuan.

Recently, micro-blog, which has a huge stock of American Apparel and van customer's products and basically broke out in the factory warehouse in Pinghu, has raised the question of the rapid expansion of American Apparel.

According to the reporter's understanding, although the rumor of "explosion warehouse" needs to be verified, the fact that its inventory pressure is huge has become the "first threshold" in 2012.

According to the three quarterly report of Smith Barney apparel, as of September 30, 2011, the company's total current assets totaled 6 billion 18 million yuan, of which inventory reached 2 billion 982 million yuan, accounting for 49.55%. Compared with the beginning of the year, the stock balance rose by nearly 5 percentage points in total current assets 45.3%, a record high.

However, what people are more concerned about is that since the listing of Smith Barney apparel in 2008, the stock has been increasing year by year.

From September 30, 2010 to September 30, 2011, inventory rose fastest, up 1 billion 190 million yuan over the same period last year.

In this regard, the group analyst Wan Ge in the analysis that the balance of inventory and the proportion of inventory in the current assets increased, seriously affecting its cash flow turnover.

The fundamental reason for the increase in apparel inventory is that it is too optimistic about market expectations, and is not mature enough to learn from the channel model of outstanding enterprises in the same industry.

Due to the small number of new products listed in the same period and the large volume of single production, the overstock of overstock has been overloaded.

According to the previous report issued by Shenyang Wanguo Securities, the U.S. stock market reached 2 billion 560 million yuan at the end of 2011, of which over 1 billion 500 million yuan was over season, which exceeded the operating profit of the United States.

"Because of the recession of the economic environment, many garment enterprises are troubled by high inventories. Many brands have seen negative sales growth in China last year, while production is on the rise and sales are declining.

Therefore, Mei Bang dress is not a special case.

However, if the high inventory is handled carelessly, it will face greater financial crisis.

A garment industry analyst who declined to be named told reporters.

So, for the United States, how to solve it?

"For the time being, there is no good way."

Relevant analysts of today's investment said that although the inventory turnover rate improved by quarter, the absolute amount of stock remained high. In 2011, spring and summer and previous quarter products were about 1 billion 500 million yuan. In 2012, they still faced with discounted inventory, which would have adverse effects on gross profit margin in 2012.

According to a reporter's observation, the operating cash flow in the three quarter of 2011 in the United States has recovered from the net outflow to a net inflow compared with the previous year. However, judging from the changes in the balance sheet, the improvement may come mainly from the decrease in prepaid accounts and the increase in unpaid taxes.

At the same time, from 2010 and the first three quarters of 2011, the overall situation still showed a large net outflow.