Kyushu Capital dilemma Three degree of debt difficult to solve hunger

Chen Hongxia Shi Zupo Wuhan report from the real estate investment return to the main business of Kyushu Tong, is in the downstream of the industrial chain, but it is difficult to cover the "fodder" shortage. October 18, the first public offering of Kyushu, no more than 1.6 billion yuan of corporate debt officially approved.　　That means that Kyushu, which relies on revenue from its main business to meet expanding demand, is accelerating its search for alternative financing channels in the capital markets. "In recent years, the private nature of Kyushu Tong, is the use of pharmaceutical circulation market to open the policy of public investment, accelerate the development." So we need more money to expand. "Kyushu Tong Dong Lin Now Yang said, fortunately at present the company financing channels unobstructed."　　This issue of corporate debt is also to change the current debt structure, the company's development to provide a stable cash flow. In fact, Kyushu's asset structure is becoming grim. The 2012-year report showed that the company's asset-liability ratio was 66.38%, compared with 50.75% in 2010.　　The company's fast-moving ratio is below 1 for a long time, indicating that it has insufficient short-term solvency.　　In the industry, it is more urgent than the financing channels, it is the state to adjust the circulation of drugs in the policy, let it bear a certain degree of transition pressure. One industry analyst, who declined to be named, said: "The volume of Kyushu Qualcomm as a circulating enterprise, in the context of health reform, its business model will face challenges." "After the expansion of Kyushu, the biggest efforts to focus on the problem of getting rid of the low margin."　　The way to deal with it is to do it in the extension of the industrial chain. "The extension includes up and down two aspects."　　Lin Now Yang said, but in the medical circulation industry, transformation into a production-oriented enterprises facing the supervision and development is more difficult, therefore, the company's main focus is, through mergers and acquisitions, cooperation and joint ventures to expand the terminal market. 2010, Kyushu Tong acquired three circulation enterprises in Sichuan Province, the purpose of which is to expand the local logistics network layout.　　Since last year, however, it has tried to diversify through expansion. 2011 Annual report shows that last year, Kyushu through mergers and acquisitions, joint ventures and other ways to win about 13 projects, the extension of its acquisitions began to expand from the field of circulation to the terminal, production and other fields.　　For example, in the terminal market, Kyushu Tong mergers and acquisitions Henan Big Pharmacy and other enterprises, and with the help of Hubei incense Lotus Pharmaceutical Industry "hand", the layout of Chinese medicine industry. This year, the idea of a diversified expansion continues.　　October 10, Kyushu Tong and North China Pharmaceutical both issued a notice, announced the former in cash to increase the latter's wholly-owned subsidiary of International Trade Co., Ltd., after the completion of the investment, North China Pharmaceutical holding 51% Holdings, Kyushu Pass shareholding 49%. "Kyushu through the domestic network coverage reached about 80%, but the breadth and depth of the distribution of different regions."　　"Lin Now Yang explained that, for example, the company has not actually entered the North China market, and the purpose of its cooperation with the North China pharmaceutical is precisely the use of its controlling shareholder, the state-owned enterprise background and resource advantages, pry open the North China region including hospitals in the overall pharmaceutical circulation market. Not only that, the company invests about 100 millionYuan, through joint ventures in Beijing to organize a hospital, is expected to be put into use in the second half of next year. Involvement in hospital sales has been the direction of Kyushu efforts, but the expansion in this area involves many problems such as money back.　　The company's 2012.5 Annual report shows that the amount of accounts receivable is as high as 3.06 billion yuan, the bill receivable is nearly 1.3 billion yuan, two receivables accounted for the company's total assets of 32%.　　Funding hunger for the above indications, a liquidity-dependent enterprise that relies on low-cost and low-cost expansion needs to be transformed, and the next focus must be on the search for high margin business in the pharmaceutical market, the public hospital market at level two or above. But the average annual net interest rate of less than 2% per cent and a net profit of only about 300 million yuan is clearly insufficient to support such a huge demand for capital.　　The financial distress caused by this expansion pressure has been reported in the earnings. In the past three years, the company prepaid accounts, accounts receivable and other operating receivables and inventory occupation of more liquidity, operating activities cash outflow is greater than the cash inflow of operating activities.　　Data show: 2009, 2010, 2011 and the first half of 2012, the activities generated by Kyushu operations Net cash flow is 515 million yuan,-1.034 billion yuan,-344 million yuan and-799 million yuan. "The company's demand for funds is increasing," he said.　　"Lin Now Yang also frankly, at present, the company's main expansion of the hospital business capital recovery cycle elongated, the company is also planning to acquire a number of projects, and the company's IPO when the project also needs capital replenishment, capital demand than in the past a lot more." Kyushu accelerates financing in capital markets. Prior to the issuance of the company's debts, Kyushu had completed the issuance of the first issue of short-term financing vouchers for 2012, totalling $700 million, on July 19, 2012.　　Last November 4 also issued a total of 800 million yuan for the first period of 2011 short-term financing coupons. "In less than a year's time, through a variety of ways to finance, the frequency is relatively high."　　"This indicates that Kyushu is facing strong capital requirements and that capital markets are the most convenient means of financing," the analyst said. To this end, Kyushu Tong will be regulated by more stringent real estate business stripping. "Its purpose is to clear the window of the company's listing financing.　　"Lin Now Yang also admits that, compared to the short-term financing coupons, this issue of corporate debt to the company to bring more stable cash flow, conducive to the company's next operation." The Bank financing channel also is unobstructed. Company Bulletin also revealed that "as of June 30, 2012, the company has a total of 9.333 billion yuan loan credit line, which has not used the credit limit of 5.059 billion yuan, the company has a very smooth direct and indirect financing channels."　　"However, in contrast to the demand for finance, there is a greater pressure on Kyushu to adapt to the changing business model," he said. "The separation of medicine policy, so that the state of the medical field gradually liberalized, gave Kyushu Tong development opportunities, but the other side of health reform, is the compression of circulation links." "Another industry analyst pointed out that this depends on the" fast-sell, quick-match "mode ofKyushu, for its part, limits the profitability of its business model and needs to find new profit points outside the "handling costs" of its circulation. At present, the establishment of logistics facilities, cooperation with Chinese medicine, access to hospital management areas and other measures, is to expand the profitability of the company, improve the company's operations. However, at present to take food from the current traditional system, Kyushu Tong also needs a certain degree of adaptation process. ”