Discussion On The Financial Risk Of Companies Based On Cyclical Industry

Since the outbreak of the financial crisis caused by the United States subprime mortgage crisis,the global economy has ended the period of 10 years of prosperity,stability and rapid development.After the outbreak of the crisis,the most prominent problem is the economic structure of our country industry is faced with a serious problem of overcapacity,such as steel,coal,aluminum,flat glass,and shipbuilding industry,a serious shortage of capacity utilization,low operating efficiency,serious losses,if not a reasonable solution to the overcapacity and losses,not only will cause the loss of the whole industry,unemployment,increased non-performing loans,increased energy overcapacity and deterioration of the ecological environment situation,harmony and stability,will also affect the healthy development of industry,society,and the adjustment and transformation of economic growth mode in china.Currently,the industry with surplus capacity mainly focuses on demand elasticity,small supply elasticity,large investment scale and long capital intensive periodic industry.The development of the cyclical industry is deeply influenced by the global macro-economic cycle and the industry cycle,which leads to the great uncertainty and complexity of the operation.Traditional financial risk prevention methods are severely challenged in the risk prevention of enterprises in the cyclical industry.Therefore,this paper takes the financial risks of cyclical industry enterprises as the research content,and hopes to provide some theoretical and practical references for the reasonable assessment of the financial risks of China's periodic industry enterprises in order to solve the problem of overcapacity in China's cyclical industry.This paper studies the financial risk of cyclical industry by combining theory with case study.First,we analyze the relevant references and theories,and then analyze the operating characteristics of cyclical industry enterprises,and put forward the difference between the financial risks of the periodic industrial enterprises and the traditional non-periodic.Then,taking yanzhou coal industry as an example,this paper studies the operation status,debt risk situation,financing and investment risk,cash flow and capital recovery risk of yanzhou coal industry in the industry boom and recession stage,and then analyzes the causes of the financial risk of yanzhou coal industry.Finally,it is the conclusion of this paper,and proposes some methods to improve and adjust the financial risk prevention.The first part is the introduction,It's about the research background and research significance of this paper,the literature review of financial risk and the financial risk of cyclical industry enterprises,research ideas and research methods,and the main content and basic framework of this paper.The second part is an overview of the financial risk theory of cyclical industrial enterprises.Firstly,it introduces the broad and narrow definition of financial risk,four common types of financial risk and three methods of financial risk analysis;Secondly this paper introduces the concept of the economic cycle and cyclical industries as well as the cyclical industry enterprise business characteristic;Finally,the three theories of the financial risk of cyclical industry enterprises,namely economic cycle theory,capital structure theory and risk management theory.The third part is an introduction to the case,introduces the basic situation of yanzhou coal industry from the perspective of the characteristics of the company and the perspective of the business,as well as the periodic characteristics of the coal industry,and shows the performance of the financial risks of the industry boom stage at the Angle of the change of the total amount of the debt in the period 2002-2014,the size of the investment and the change of the profitability,Then from the 2012-2014 years of debt situation,profit status,capital operation and other angles to show the financial difficulties in the downturn of the industry.The fourth part is the analysis of the causes of the financial risk outbreak of Yanzhou coal industry,this paper from the two aspects of the external environment and internal management reasons for the resolution of the financial risk,specifically the external causes include the downturn in the economic environment,the imbalance of supply and demand,coal price index is low fan,the RMB exchange rate rise,industry and energy structure adjustment reasons.The internal causes include the debt capital structure is unreasonable,the lack of scientific investment decision,the weak exchange rate risk management awareness,improper cost control,accounts receivable recovery is not timely.The fifth part draws the conclusion and enlightenment.Aiming at the causes of the fourth part of the analysis,it puts forward the precautions for the cyclical industry in the boom and downturn stage.In the boom stage,we need to control the capital structure reasonably,raise funds in multiple channels,control the scale and timing of investment,and strengthen the recovery rate of funds.In the downturn stage we need to compress coal production capacity,adjust product structure,accelerate transformation and upgrading,pay close attention to macroeconomic and industrial policies,control costs and improve enterprise management.