| Financial analysis is the analysis and research on the financial statements of the relevant data to assess the financial condition and management performance, discover the management problems and potential risks of the enterprises'production and management, and forecast future trend, in order to provide a basis for scientific decision-making.Chinese listed companies are the community with the most economic development advantage, also the source for the capital market to invest .How to identify the risk of a listed company, prevent and resolve risks on time, promoting healthy and stable development of Chinese capital market, which is a difficult problem for the supervision staff . We should detect and analyze the listed company profoundly and get financial analysis, and consider the company's M & A, stock price volatility, corporate governance, standardize the operation, the sincerity record, characteristics of the industry and some concrete conditions. And then combine the quantitative analysis and qualitative analysis, judge and reveal the risk factors of the listed companies, determine the risk classification of the listed companies scientifically, and take different supervision measures to different risk levels of the companies. It is beneficial for supervision department to allocate supervision resources rationally, improve the efficiency of supervision, realize the initiative, efficient and continuous dynamic supervision .The predecessor of Suning Universal Co., Ltd(hereinafter refers as"Suning Universal"), the Jilin Paper Manufacturing Co., Ltd is typical of spin off listing state-owned enterprises. After restructuring and listing, the company is still burdened with heavy"enterprise-run society", together with the newsprint market competitions and investment mistakes and other reasons, which lead to the gradual deterioration of its financial situation until comprehensive off production. As the year of 2002,2003,2004,three consecutive years of loss , the company had been suspended from listing in May 13, 2005. But after a series of capital operations, such as debt restructuring, the realization of assets and assets reorganization, the company stock recovered to list and transact in December 26, 2005. And it changed its main business from the newsprint production and sale to the real estate exploitation and management and the commercial concrete production and sale. In recent years, under the national control policies, there was a temporary adjustment happened in the real estate industry. But in the long run, the real estate industry, especially the residential industry will continue to be one of the most potential and development industry. Whether Suning Universal can seize the opportunity and realize their strategic goal of"national leader with a comprehensive large-scale real estate"in next five years, attracts significant attention. In this case, the financial analysis of Suning Universal is of great practical significance.The author studies Suning Universal from the view of listed companies supervisor innovatively, mainly using methods of the comparison analysis, ratio analysis and trend analysis and doing a systimatic analysis of financial data from 2002 to 2007 for the company. Through this analysis, in the author's personal opinion,take reorganization of assets in late 2005 as a major sign, the company's financial situation has changed in the turning point. The company not only got rid of bankruptcy adversity, but developed rapidly under the support of new actual controller and showed a good development trend. However, at the same time there are still some problems that can not be ignored in the financial management:1. weak solvency of enterprise in short-termIn the tight monetary policy, enterprise financing becomes more difficult. The fund is still the major bottleneck for the development of real estate industry with financing cost rising. The project development expenditure of Suning Universal is increasing, which makes weak solvency in short-term worse. At the end of 2007, net cash flow of operating activities was -326 million. Cash flow tension increased the pressure to repay.2. the high rate of assets and liabilitiesAfter the transition from the newsprint production and sale to real estate exploitation and management, the enterprise financing channel relied mainly on bank loans. Its asset-liability ratio remained at the rate above 70% . At the end of 2007 ,after non-public issuing 91,249.6 thousand shares with 4.51 yuan / share, the asset-liability ratio went up to 76.83%, much higher than the average of 62.81 percent, showed higher financial risk.3. low inventory turnover rateIn 2007, due to the scale of development projects in the construction of housing has been higher than the rate of expansion of the size of the sales growth, the inventory turnover rate goes from 0.72 down to 0.48. Although it was higher than the average of 0.37, but after all, made the recovery cycle of inventory funds taken up to be prolonged 250 days, and reduced the efficiency of the use of funds.4. simple product structureAt present, the Tianrun project developed by the company is the economical residence. Its target market is for the ordinary people and the first time home buyers who are middle-income and want to improve the living conditions. The target of Tianhua project is for high-end consumers to create a city landscape in high-grade residential. Its product structure is simple.5. real estate products do not form the unified brandAt present, the company's real estate business mainly concentrated in Nanjing where its local real estate development has a good reputation. But not yet planed for the company's brands and formed an influential brand recognition, it is not conducive to realize cross-regional development and decentralize management risk.6. in recent years, the company did not carry out the distribution of profits to shareholdersSince 2002, the company has not carried out the distribution of profits to shareholders due to a result of restructuring and its development. After Jiangsu Suning Universal Group Co., Ltd(hereinafter refers as"Suning Group") entered the listed company ,the share price soared all the way and reached 51.11 yuan in August 28, 2007 , which created a profit opportunity for investors.But it can not meet the requirements of investors to share the results of the enterprise's development ."Listed Companies to Issue Securities Management"the general public offering of securities regulations require,"the distribution of the accumulated profits in cash in the last 3 years is not less than the 30% of the average annual distributable profits achieved in the last 3 years". Therefore, this problem is the obstacle for Suning Universal to do public offering securities financing in the future.Based on the above statement, we should continuously pay attention to two things. For one thing ,when the controlling shareholder Suning Group in the backdoor listing, it made"The high-quality real estate projects which Suning Group controls or obtains will be poured into the listed company step by step".For the other,whether the company could be a"national leader with a comprehensive large-scale real estate"in the next five years. Besides the two things need continued concern, I identified risk rating categories of Suning Universal as a concerned listed company in order to determine the recent supervision measures for the company . That is to say, in the regular supervision, we should let the company understand the concerned keypoints of the securities market supervision department by strengthening communication, make it improve its management ,eliminate the hidden risks and do the on-site inspection.Finally, the author peovides some proposals to improve the financial management of the company. These proposals reflect the concept of the supervision and service.1. to establish the concept of"cash is king"and strengthen the management of cashCash is the blood of the enterprise. Whether an enterprise could survive and develope depends on the plenty of cash flow. At present ,Suning Universal is in the period of expansion . It should set up the concept of"cash is king", constantly improve the operations of hematopoietic function, pay strict control of cash expenditure by preparing cash budget,and increase net profit of the "cash content."2. a positive adjustment of capital structure and reduction of the financial risksSuning Universal should strengthen co-operation with banks, actively adjust its loan structure, increase the proportion of long-term loans and enhance short-term solvency. And it need to optimize the capital structure, to make full use of non-public offering of stock to increase the proportion of equity financing, decrease the rates of assets and liabilities , enhance the stability of funds and ability to resist risks.3. enhance inventory management, shorten the project durationFace to the situation of the pressure of national macro-control and increasing competition, Suning Universal should adjust operating plan timely, strengthen project management for the existing construction in progress, strictly control the development costs ,shorten the cycle of its development project, and recovery of funds at a reasonable price as soon as possible. Under the conditions of the balance of funds, the enterprise may expanse appropriatly, take the strateges of development and sale by stages to improve funds'using efficiency and enhance the competitive strength.4. rich product structure, decrease operational risksSuning Universal should study the consumers'preference deeply, classify the target market and rich product structure, then it could form a differentiated advantage and reduce operational risks. Additionally, it's better to adapt to the real estate industry regulations, and increase affordable housing, such as security and housing in low-cost, small and medium-sized residential dwelling size, and actively explore the development of housing decoration and commercial real estate.5. the implementation of brand strategy, enhance the popularity of the enterpriseEffective integration of its brand and the implementation of brand strategy are good ways to establish brand of"Suning Real Estate",and rise the popularity and reputation of the enterprise. And all it do could lay the foundation for the cross-regional development strategic objective of"national leader with a comprehensive large-scale real estate"over the next five years.6. divide payment timely and share the fruits of development with shareholders of the companyAt the same time to ensure the development of enterprise, it is proper to divide payment in cash timely, share the fruits of development with shareholders of the company and set a good enterprise image. These chould lay a good foundation for the enterprise to finance through the capital market in the future. |
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