Lu Tai Plans To Build 1 Billion 900 Million Functional Fabrics Smart Ecological Park And Other Projects, Of Which 1 Billion 500 Million By Fund-Raising!

Lu Tai textile Limited by Share Ltd (hereinafter referred to as "Lu Tai A") issued a notice on May 23rd that the total amount of convertible bonds that the company intends to issue publicly is not more than 1 billion 550 million yuan. After deducting the issuance cost, it intends to invest in the functional fabric smart ecological Park Project (phase I), the high-grade printing and dyeing fabric production line project and the supplementary working capital, and after deducting the issuance cost, it intends to invest in the following items:

Among them, the functional fabric intelligent ecological park project (phase I) is located in the northern side of Lu Tai Industrial Park, Zichuan District, Zibo City, Shandong province.

After the completion of the project, the production capacity of the top grade functional fabrics with an annual output of 35 million meters will be formed. Among them, the dyed woven functional woven fabrics are 11 million meters / year, the dyed knitted fabrics are 12 million M / year, the dyed functional fabrics are 9 million M / year, and the functional composite fabrics are 3 million M / year.

The total investment of the project is 1 billion 145 million yuan, of which 930 million yuan is invested in the construction. The fund will be invested by 850 million yuan, which will be implemented by Shandong Lu Lian New Material Co., Ltd., a subsidiary of the company. It is estimated that the annual operating income of the project will reach 888 million 837 thousand and 500 yuan per year, with an average annual net profit of 82 million 150 thousand and 500 yuan.

The production line of high-grade printing and dyeing fabric is located in the existing factory area of Lufeng Textile Dyeing Co., Ltd., Jiao Wang Lu, Huang Jia Pu town, Zichuan District, Zibo.

After the completion of the project, an annual production capacity of 25 million meters high grade printing and dyeing fabric will be formed, of which the white fabric is 10 million M / year, the dyed fabric is 5 million M / year, and the printing fabric is 10 million M / year.

The total investment of the project is 378 million yuan, of which 263 million yuan is invested in construction. The 250 million yuan will be invested by the company's controlling subsidiary Lufeng weaving and dyeing Co., Ltd.. It is estimated that the operating income of the project will reach 499 million yuan per year, with an average annual net profit of 24 million 877 thousand and 400 yuan.

Lu Tai A said that the recruitment project is committed to the development and production of high-grade functional fabrics. In the production process, the raw materials such as functional yarn and other raw materials are used, energy saving and green technology without PVA sizing, pre wet sizing and other raw materials are adopted, and environment-friendly slurry, dyestuff, auxiliaries and other raw materials are used. In the production process, energy saving and emission reduction are strengthened and controlled, so as to minimize the adverse impact on the environment.

Lu Tai A is the largest shirt fabric manufacturer in the world. Its annual sales volume is close to 300 million meters. It is a strategic partner of many famous clothing brands all over the world. It has been in the forefront of China's cotton textile industry for many years. However, with the continuous changes of internal and external environment, Lu Tai A is also facing new challenges.

From the outside, with the improvement of living standards and the increase of leisure time, the demand for leisure and sports clothing is increasing. According to the different scenes, there are more and more requirements for the functionality of clothing, such as windbreak, rain prevention, breathable and moisture permeable, antibacterial, flame retardant, intelligent Wearable and so on.

From inside, on the one hand, Lu Tai A's existing fabric capacity is basically saturated, it is necessary to further expand production capacity; on the other hand, the company's existing products are mainly used in shirts category, other clothing categories are not many; for shirts category products, the proportion of formal and business style fabrics is high, and leisure style fabrics account for less; cotton based natural fibers account for a higher proportion of raw materials, and fabrics with functional and differentiated fibers as raw materials account for less.

The product structure is single, which is not enough to adapt to the changing trend of clothing consumption in the future, and is not enough to meet the needs of downstream brand customers. It is an important factor that restricts the future development of A.

Lu Tai A believes that the recruitment project will further expand the scale of production on the one hand, help maintain and expand the market share of the company, on the other hand, enrich the product structure of the company, enhance the R & D and production capacity of the functional fabrics, and provide customers with more diversified product choices; besides, the implementation of the recruitment and investment project will also help the company to deepen its industrial layout in the next stage, increase technology reserves, talent reserves and market reserves, conforming to the long-term strategy of the company's sustainable development, and is of great significance for the future development of the company.

In addition, the products involved in the investment project are mainly leisure and outdoor products. The raw materials are mainly functional fibers, which are differentiated from the original products of the company. They complement each other, conform to the current consumption trend of casual and functional clothing, and can better meet the needs of brand customers for product diversity.

In addition, the product will still be used primarily in the early stage of shirts, focusing on the marketing and promotion of existing customers to reduce the risk of project operation, and then expand the scope of products and customers.

With the completion of the recruitment project, Lu Tai A will add 35 million meters of functional fabrics and 25 million meters of high-grade printing and dyeing fabrics, which is an important measure for Lu Tai A to expand production capacity based on years of experience.

Lu Tai A said that the fund-raising investment project focused on the main business of the company, which is in line with the requirements of the relevant industrial policies of the state, is conducive to further expansion of the company's fabric field, and promotes the company's core competitiveness and industry influence, consolidates the market position of the company and enhances the company's business performance.

After this issue, the company's capital strength will be further enhanced, which will help further improve the company's business development capabilities and optimize the company's future industrial layout.

Reporters learned that Lu Tai A is currently the world's largest high-grade yarn dyed fabric manufacturer and international brand shirt manufacturer of the first line, operating performance for many years in the top ten of the national cotton textile industry.

About 70% of the company's products are sold to more than 30 countries and regions, including the United States, the European Union and Japan. Among them, the export of the company's own brand fabric accounts for more than 70%.

At present, the company's yarn dyed fabric production capacity accounts for about 18% of the global high-end shirt dyed fabric market.

The company has established long-term strategic cooperative relations with international famous customers such as Burberry, USA Oxford, Italy Armani, Gucci, Japan UNIQLO, Hongkong joint industry, etc. in recent years, the top five customers in recent years also include the famous European shirt brand OLYMP, North American professional suit retailer TheMen sWearhouse, and the establishment of nearly 100 years of German shirt brand Seidensticker.

According to the financial report, in the first quarter of 2019, Lu Tai A achieved a revenue of 1 billion 545 million yuan, an increase of 1.67% over the same period, and a net profit of 195 million yuan attributable to shareholders of listed companies, an increase of 22.54% over the same period last year.

Dongfang securities analyst Shi Hongmei judged that the gradual release of Southeast Asian capacity will provide certain guarantee for the sustainable growth of A. It is expected that the company's profit level will be better in the first half of 2019.

Specifically, starting from 2017, the relatively low cost production of fabrics and shirts abroad (Vietnam's two stage yarn dyed fabric and spinning capacity) will bring new extension to the follow-up income and earnings of A, and further consolidate the dragon head position in the global high-end yarn dyed fabric industry. Compared with the previous year, the RMB exchange rate against the US dollar has depreciated in the first half of 2019. It is expected that the gross profit margin and profit of A will also be promoted in the first half of the year.

In the view of Shi Hongmei, Lu Tai A is truly one of China's high-end textile manufacturing enterprises with international competitiveness. The future industry concentration, product added value and industrial operation efficiency will be the driving factors of the company's performance growth.

As of March, A completed the buyback of 64 million 480 thousand and 800 B shares. Share repurchase and high cash dividends over the years (the current dividend yield of 4.7%) has been one of the important means for Lu Tai to enhance corporate value and maximize shareholder equity.