How Should The Tanning Industry Break Through And Transform Or Stick To It?

For the global manufacturing industry, 2016 is not a happy year. The tannery industry is still bleak. It can not escape the various factors such as environmental regulation, policy pressure, labor and raw material costs. The past year has not been easy. Will the situation be improved in the coming 2017? How will the listed companies operate in the industry? What changes will they make? Faced with the dilemma, how can the tanning industry break through and transform or stick to it?

After the Spring Festival of 2017, reporters learned that only a few tanneries could produce as usual, most tanneries did not fully return to normal production conditions. A tannery in Guangdong released a 20 Day holiday during the Spring Festival. However, as of February 15, some employees still did not report. A tannery owner in Zhejiang did not come to the factory very much. Some technicians were looking for jobs everywhere. Some tanneries also did not work because their work was not too much. Enterprises in Zhejiang, Hebei and other regions have told reporters that this year's finished leather is almost no profit if it is sold at the price of previous years, but obviously the price increase is limited, and the market demand for the terminal has obviously declined. 2017 years later, due to lack of work, several tanneries began frequent recruitment notices. According to several bosses who have started work, this year will not increase the wages of workers, and it will be good to maintain the level of last year, because orders are not very large, and we should be cautious about the market situation this year.

In 2017, Tannery cost Still hard to drop. On the one hand, the supply of raw leather is tight. On the other hand, the price of imported leather is also rising. In addition, the rising prices of chemical raw materials caused by rising oil prices, rising transport costs, rising labor costs, increasing environmental protection costs, and rising costs caused by electricity shortage are all pushing factors for the cost of leather production. As early as 2016 November, the price of international raw leather has risen 3 times as a market vane of the world's raw cattle skin. The price of American 62/68 pound weight Dezhou castrated cowhide FOB has risen to $71 / Zhang, which has risen by 9.50 US dollars since March, June and November, or more than 15%. Compared to the October 2015 Dezhou castrated cowhide FOB lowest price of 55 U.S. dollars / 35% Zhang, the current price of Dezhou stew leather rose 35%.

Environmental storm, shrinking orders, soaring costs, tax burden... At present, China's leather making enterprises are generally developing circumstances. In 2016, the Ministry of environmental protection once again intensified its efforts to supervise environmental protection throughout the country, and launched a series of environmental protection rectification policies and guidance documents. The major leather tanning areas in the country have been impacted unprecedentedly. Some large leather enterprises continue to intensify environmental protection efforts to upgrade cleaner production and sewage treatment. Some tanneries, which do not meet the requirements of environmental protection policy and rectification conditions, have been forced to demolish. The news of the rectification of various leather bases is constantly reported.

In the economic downturn, some people have made the following summary of the necessary stages of leather making enterprises. (1) the strong stage: maintaining the original scale, perhaps as 2008, will be better in a few months. (2) reduce the capacity stage: inventory to the limit, supplier funds have been occupied to the limit, no payment, no delivery. (3) low price promotion stage: only to generate cash flow, no bottom line loss competition, sales price is not the lowest, only lower. (4) account sales promotion stage: in order to ensure the upstream suppliers' payment, the distributor payment and delivery mode was generally adopted. After the buyer's market became a buyer's market, the selling mode was adopted. (5) phased layoffs and further reductions. (6) stage of bankruptcy run: insolvency, sales decline, less than the cost of purchase costs, faced with a continuous loss of bottomless pit, choose to apply for bankruptcy. (7) forced transformation stage: improve product quality, pay attention to environmental protection, adapt to the transformation stage of individual needs of customers. The reality is that many enterprises have not yet been able to endure the last stage and have become unsustainable.

The latest feelings about the industry situation and the announcements and movements of tanneries listed companies are the most telling questions. The reporter read the news bulletin and financial situation of several major listed companies in the industry, and learned that only for the profit and development space of leather making, most enterprises were in a state of atrophy, and investment in other industries or transformation became the choice of more listed companies. Under pressure, the situation of listed companies is different and their actions are different.

Brotherhood technology, which develops, produces and sells vitamins and leather chemicals, has recently released a plan to increase its investment in the fine chemical industry. However, reporters read the public information and found that the whole plan is not related to the leather industry. Brother Technology Bulletin shows that the company intends to sell at no less than 11.22 yuan / share price, no more than 148 million shares of non-public offering, raise funds not more than 1 billion 660 million yuan, invest in the construction of 20 000t catechol, 31 100t catechol derivative construction project, annual output of 1 000t iodine contrast agent and other items. According to brother technology, the company will become a strong competitor of the global hydroquinone industry through the new investment projects and meet the needs of strategic development. Through this fixed increase, the company can rely on its competitive advantages and industry status in the fine chemical industry to enhance the core competitiveness of the company, thereby enhancing the company's performance and shareholder returns. In order to increase the "escort" for the increase, as the actual controller of brother technology, the two Qian Zhida and Qian Zhiming brothers promised to use their own funds or legitimate funds raised to subscribe no less than the number of 10% of the non-public offering stock, while not participating in the bidding process and accepting the final issue price.

Reporters learned that the products of catechol derivatives are widely used in food, feed, medicine, cosmetics and other fields of application, and have the same application fields and customer groups with the leading products of brother technology, such as vitamin K3, vitamin B1 and vitamin B3. The construction of the project can make it a strong competitor of the global hydroquinone industry, and further enhance its market position in the field of fine chemicals, such as feed additives, food additives, and so on, so as to inject new impetus to the rapid and healthy development of the company. Iodine contrast agent is mainly used for the imaging of various organs and tissues. Brotherhood technology will further increase the iodine contrast agent and its intermediates on the basis of the existing single vitamin raw material business through this non-public offering, and achieve the strategy of vertical integration from fine chemicals, pharmaceutical intermediates to raw pharmaceutical products. Through this fixed increase plan, brother technology will increase the proportion of vitamins and fine chemicals. Looking at the company's investment routes in recent years, the company's investment in vitamins has been increasing. In November of 2015, the company completed the construction project of annual output of 13 000t vitamin B3 (nicotinamide, nicotinic acid), 20 000t 3- cyanopyridine and annual output of 5 000t vitamin B5, 3 000t beta aminopropionic acid, 1 000t 3- aminopropanol construction project with 15.55 yuan / share and 51 million 446 thousand and 900 additional shares. The proportion of leather chemicals is gradually shrinking. Reporters learned from the information disclosed by the company that as of June 2016, the proportion of leather chemical industry's revenues accounted for only 25.66% of the total chemical revenues of the brothers, and the profit ratio was as low as 16%. In the future, whether the company will continue to expand its investment in other areas is unknown, but it is foreseeable that the proportion of leather chemicals will continue to weaken.

With fur clothing, fur accessories, fur fabrics, Fur The production and sale of leather products, the main business, has reached a new low in recent years. Although in April 2016, the company had no less than 14.31 yuan per share, no more than 41 million 928 thousand and 700 shares in the non-public offering, and the total amount of funds raised was not more than 600 million yuan, investing in cleaner production platform projects and cleaner production warehousing base projects. At the same time, in the first half of 2016, Wordsworth also integrated upstream resources, through strengthening the cultivation of overseas farm mink breeds, laying the foundation for the introduction of high-end mink varieties by domestic farmers, and playing the role of integrating fur fur raw material market resources in the two phase of fur raw materials market. But these measures do not seem to change the reality of the company's poor management.

In 2016, the half year report of Wordsworth Ag showed that during the reporting period, the company achieved operating income of 206608402.55 yuan, 14.89% less than that of the previous period, and net profit attributable to shareholders of listed companies was 8 731 996.78 yuan, a decrease of 13.52% over the same period last year. The three Quarterly Bulletin released by the company in 2016 showed that 3.41 revenue in 2016 was 15.4% yuan, down by a year earlier. I do not know whether it is for transformation or for the main business. In August 2016, the company invested 5 million yuan to invest in 10% shares in the future. The company announced that in the future, it signed a number of 20 people who have the ability to turn the electricity providers into cash. In the future, with the continuous growth of the number of fans, the popularity of their own brands will expand, and the sales scale is expected to be improved. This is also an extension of Huas shares after 2015's investment in micro-blog's social networking ecosystem. The capital market is racing to guess that the company will cut into the red field of the beauty makeup network, aiming to build the first share of the net red business. However, Ms. Xu, the company's securities affairs representative, said in an interview with reporters that although the company did not rule out the future to continue to increase its future, the company will always take fur clothing as its main business, and invest in the future of technology and acquisition. It will be the layout of the online sales network and serve the company's O2O strategy. After completing the above investment, the current shares of micro-blog have formed a closed loop of fans, red data mining (excellent technology), net red operation (future time), back-end docking (supply chain) and cash realization (micro sale). From the 2011 to 2015, the company used nearly 5 years to make the whole fur industry layout. From overseas aquaculture to the production, wholesale and retail of the Chinese market, the whole chain company has basically completed the layout. In the future, the layout of the whole industry will be deepened and transformed. The fur industry has bottomed out, and the speed of the rebound will depend on the development of China's economy.

To manufacture furniture, leather and automobiles Leatherwear Carson international, which is well-known in the industry, has set foot in the tourism, real estate and related industries for a few years. On February 2016 1, Carson International announced that the holding company, the wholly owned Affiliated Companies of the company, the wholly owned Affiliated Companies Zhejiang Carson Industrial Group Co., Ltd. and Mr. Zhu Zhangjin, entered into a sale and purchase agreement with MS. Zhu Jiayun and MS. Zhu Lingren, and sold the Affiliated Companies that 7 engaged in the manufacture of automotive leather and furniture leather business, including Haining Carson leather, Haining ZEHNDER, Haining Sen Mei, Dafeng Huasheng, Haining home value, Wuji Carson and Haining Carson automobile. The related leather business was listed as a discontinued business in the interim report of 2016. Reporters learned from the company's financial circular that as of November 2016 25, all the equity transfer has been completed. After that, Carson International announced that in December 21, 2016, Zhejiang Carson sold the 27% stake to the Central South stamp trading center limited to the Central South stamp seller in Hunan, with a cost of RMB 324 million yuan. The price of the company is about $1 billion. The price of the company is about $1 billion. The price is RMB $27%. In addition, the company acquired 24% stake in Target Corp for Tsui Yi seller, which costs RMB 2.88 billion yuan. Reporters learned that the acquired Target Corp operated an electronic trading platform, mainly engaged in collecting coins, banknotes, stamps, artwork and cards, matching buyers and sellers through electronic transactions, and providing related technology and consulting services. The transaction fees were charged through trading platform through electronic trading platform, and commission, logistics, information, investment consulting, appraisal, exhibitions and other related support services were also provided to the trading participants. As early as a few years ago, Carson international also invested in tourism real estate. As of the recent financial situation, the proportion of property development revenue has reached 67%. Reporters also noted that in a previous announcement, Carson international has clearly pointed out that in order to diversify business and enhance the long-term growth potential of the company and shareholder value, the company will actively seek opportunities from time to time, including investment in the new business segment.

Among all the listed companies in the industry, only Xingye technology shows a unique position in the leather industry's specialization and concentration. The company's financial statements show that all the profits and business revenue of the company are derived from the sales of Ngau Tau leather, including raw leather, blue wet innovative technology, leather finishing, new technology processing, leather new materials, new technology and new technology research and development. In January 20th, 2017 announced that the company's net profit in 2016 1-12 was attributable to shareholders of listed companies 59 million 850 thousand to 66 million 500 thousand yuan, an increase of 350% 400% compared with the same period last year, and the textile industry's average net profit growth rate was only 2.23%.

about Tanning industry In terms of development, Xingye technology has expressed its firm optimism that the price of leather will stabilize and help its performance continue to recover. As the price of leather begins to stabilize in the second half of 2015, and the company implements the global procurement strategy to smooth procurement costs, the gross profit margin of Future Ltd is expected to gradually recover to the level of 14% ~ 15%, resulting in huge upward elasticity of performance. In addition, China is now pushing forward the supply side reform of the leather industry step by step, eliminating backward production capacity and increasing the entry threshold in terms of scale and environmental protection, and the future market share is expected to concentrate on leading enterprises such as Xingye technology. To enter new fields and expand future growth space, stable ownership structure and sufficient cash assets can help companies develop by leaps and bounds. Societe Generale technology said that the company has entered into new fields such as financing leasing and hazardous waste treatment PPP. Exploring environmental protection in leather industry is conducive to continuous green development and creating new profit growth points. At the same time, financial reports show that the company has about 8.1 billion in cash, and the shareholding ratio of the real controlling people and their immediate families is as high as 56%, which provides a broad space for their subsequent capital operation. The company's recent two capital operations include the company's annual 150 million high-grade leather finishing and new technology processing projects and the company's annual processing of 1 million 500 thousand wet blue expansion projects (An Dongyuan), which are closely related to the leather industry. At the beginning of the meeting, Xingye technology indicated that in the future, we should do well in the main business, strengthen internal management and increase profit margins, so as to further establish the position of big players in the industry.

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