Xinmin Textile: A Sharp Reduction In The Original Executives, Veteran Retreat

In September 25th, *ST Xinmin (002127.SZ) announced that for personal reasons, the deputy general manager Dai Jianping and chief engineer of the company resigned from all positions.

Two bit *ST

The resignation of senior executives is at the critical juncture of *ST Xinmin reorganization.

In addition, the reporter noted that the two Dai Jianping and Ren Jun also hold two shares of *ST Xinmin, Wujiang Xinmin Industrial Investment Co., Ltd. (hereinafter referred to as "Xinmin Industrial").

Xinmin industry is a company controlled by *ST new people's actual controller, Levitt, and its shareholders are mostly middle and top level of *ST Xinmin. The company began to reduce substantially from the second half of this year and accumulated more than 150 million yuan.

Looking back at *ST's performance in the past 7 years, it has become a key word for money, losses, losses and restructuring.

*ST Xinmin

7 years ago, when *ST Xinmin landed in the small and medium sized board of Shenzhen Stock Exchange, the then Chairman Liu Wei Ti once told the media: "the ultimate goal of Xinmin technology listing is summed up in one sentence, that is, to create a hundred years' foundation and create a hundred years' enterprise."

Referring to the comprehensive evaluation of the industry competitiveness of the China Textile Industry Association, the reporter found that from 2004 to 2011, *ST Xinmin entered the "top ten competitive industries of China's silk industry" for 8 consecutive years, and it is the National Silk and imitation silk product development base.

But now, *ST Xinmin has been on the decline: in 2012 and 2013, a total loss of 700 million yuan for two consecutive years, in 2014 half year to achieve the net profit attributable to the owners of the parent company -1.8 billion yuan, the first three quarters of 2014 is expected to belong to shareholders of listed companies net profit loss of 198 million yuan.

In addition, its asset liability ratio also climbed from 43.03% at the end of 2010 to 88.6% at the end of June 2014.

In retrospect, during the 6 years of Liu Wei's *ST administration, the *ST Xinmin raised nearly 7 hundred million of the total funds, including 263 million yuan raised by IPO and 430 million yuan in July 2010. However, these projects did not achieve the expected benefits, so *ST Xinmin was once questioned by the market as "money".

Especially in December 6, 2011, *ST Xinmin threw out a new refinancing scheme to raise 734 million yuan for the "120 thousand tons annual super simulation differential spinning production line project" and "annual output of 30000 tons solvent method cellulose fiber project", but all of which ended in no end.

Continuous fund-raising and failure to achieve

The market disappointed them, so *ST Xinmin shares went on a long bear road.

The stock price dropped from 6.19 yuan to 2.79 yuan in June 25, 2013.

In July 31, 2013, *ST Xinmin resumed and announced that the actual controller changed to Jiang Xueming, and then even received 8 lines, eventually closing at 5.77 yuan, up 70% from the 3.28 yuan before the suspension.

The *ST Xinmin, who was handed over to Jiang Xueming, was almost a mess, losing for a year and a half.

It is obvious that Jiang Xueming, who took over, failed to reverse the loss of listed companies. In March 2014, *ST Xinmin announced that the company would be implemented "delisting risk warning" because of losses for two consecutive years in 2012 and 2013. If the turnaround was not realized in 2014, it would be suspended in 2014.

From the following series of integration operations, Jiang Xueming, who won the "*ST Xin Min" at that time, did not do business. The shell value of *ST Xinmin was probably his real match.

In April 2014, *ST Xinmin announced that the integration of Xinmin dyeing and Xinmin chemical fiber was completed. The company will resume trading and sell Xinmin dyeing and Xinmin chemical fiber to the indirect controlling shareholder Dongfang Hengxin Capital Holding Group Co., Ltd.

At this point, *ST new people stripped in its main revenue accounted for nearly 80% of the chemical fiber business ideas gradually clear.

"PTA is an important raw material for chemical fiber polyester industry.

The price of PTA was suppressed relatively low in the first two years, but after May this year, the price limit of PTA raw materials manufacturers jointly raised prices, so that the price of PTA basically showed a trend of concussion, which directly led to this year's downstream side is more laborious, and the loss is also gradually increasing.

Zhang Cuiru, an analyst with Zhuo Chuang information polyester industry, told reporters that from the current situation, this trend of upstream strength will continue, and the possibility of improving the chemical fiber industry in 2014 is almost impossible.

In this regard, *ST Xinmin Dong mi Zhang Yanni also believes that the company's current loss of chemical fiber is serious, after the separation of chemical fiber and printing and dyeing business, the company will be mainly silk weaving and so on. "The profit of silk weaving can still be achieved. The company is now at a crossroads. If the restructuring fails, the company is not only unable to plan important matters in half a year, but also fails to represent the company, so it will be suspended from listing next year.

Moreover, even if it is successfully stripped, it is hard to say whether the company can make profits after divestiture, which depends on financial treatment.

Because the profit and loss of chemical fiber and printing and dyeing business during the pition period is to be borne by the listed companies, the time of disbonding is different and the financial treatment is different.

"I think the problem of bank debt pfer in the reorganization of Xinmin technology is particularly important.

A lot of restructuring will involve debt pfer, but Xinmin technology's debt pfer amount is large and involves many banks, and the major entities pferred to new people's chemical fiber losses are serious. At this time, the attitude of each creditor bank is very important.

Financial commentator Song Qinghui pointed out.

According to the announcement of *ST Xinmin in August 29th, up to now, the pfer of related bank debts has basically been completed.

Recently, however, it was reported that the pfer plan of *ST Xinmin's loan to Shengze branch of a creditor bank was returned by its head office, and Zhang Yanni said she had not heard about it.

Since then, the reporter has verified the matter on the 22 day of September 2014 to the above head office. The person in charge of the media told reporters: "because the bank has been approved by several departments, it is impossible to hear the final approval result, but this is just an ordinary business of our bank. There is nothing special and there is no bad problem."

At the same time, when *ST Xinmin focuses on "shell war", its second shareholder Xinmin industry is reducing its cash holdings.

In August 29th, *ST Xinmin announced that Xinmin Industrial Co., Ltd. in June 12, 2014, July 21, 2014, July 22, 2014 and August 26, 2014 through the Shenzhen stock exchange block trading method, a total reduction of the company's unlimited sale of tradable shares of 22 million 300 thousand shares, accounting for 4.99% of the company's total share capital.

Among them, in June 12th, Xinmin industry sold 500 thousand shares through the block trading of the Shenzhen stock exchange, the paction price was 6.01 yuan; in July 21st and 22nd, 20 million 800 thousand shares were reduced, the average paction price was 5.8 yuan; in August 26th, 1 million shares were sold, and the paction price was 6.11 yuan.

According to this calculation, Xinmin Industrial Holdings has gained nearly 130 million yuan in cash.

According to Wind information statistics, in September 2nd, Xinmin industry again sold 1 million 500 thousand shares in block trading, with a paction price of 6.68 yuan and a turnover of 10 million 20 thousand yuan. In September 3rd, Xinmin industry sold 1 million shares at a price of 6.71 yuan, with a turnover of 6 million 710 thousand yuan. In September 4th, Xinmin industry sold 1 million 500 thousand shares at a price of 6.55 yuan, with a turnover of 9 million 825 thousand yuan.

That is to say, Xinmin industry has gained 4 million shares in the 3 days through block trading, which is now 26 million 555 thousand yuan.

According to the calculation, Xinmin industry has accumulated more than 150 million yuan in the second half of this year.

So why does Xinmin Industrial cash flow? For this reason, Zhang Yanni said that two shareholders have their own capital needs.

It is worth noting, however, that the two shareholders of Xinmin industries are mostly *ST senior members of Xinmin, including the former chairman of *ST Xinmin and the actual controller of willwitt. He is currently the vice chairman of the listed company. He is the largest shareholder of Xinmin industry, holding 53.44% of Xinmin industry, and 10 new employees of *ST Xinmin who have left or are still on the job. Among them are the deputy general manager Dai Jianping and chief engineer of the resignation.

"The resignation and reduction of executives in fact indicate that the original team has decided to take the initiative, and the original controller actually started to retreat. This may be the result of the continuous loss of Xinmin technology and the result of the stock price being sluggish all the year round.

And in July 2013, the actual controller changed to Jiang Xueming, which can be said to have saved the share price of the listed company, and also let the original personnel find the opportunity to reduce.

Song Qinghui believes that "Xinmin technology from the listing of the top ten Chinese silk industry to the current loss, is the result of continuous blind project and expansion, but also the result of its management decision-making errors, it is worth reflecting."