Shulou(Shulou.com)06/01 Report--

Writing / Xiaoxiao dusk rain

Product / interesting Finance and Economics

Blu-ray's development of high interest rate bond issuance has gradually become the norm.

In late May 2020, Blu-ray Development announced the first phase of the 2020 debt financing plan and the second phase of the debt financing plan.

The total amount of the bond financing plan is 1.19 billion yuan, of which the maturity of the first phase of the product is 365-365-350 days, and that of the second phase is 365-365-346 days. The interest payment frequency is 3 times, and the listing interest rate is 10.5%.

Prior to this, Leju statistics of short-term financing costs of real estate enterprises in the first three quarters of 2019 showed that the average short-term financing interest rate of housing enterprises was 4.22%. Among them, the interest rate on the 600 million yuan short-term financing bonds issued by Blu-ray Development in August is the highest in the industry, reaching 7.4%.

Not only that, two dollar bonds announced by Blu-ray from March to April 2019 showed an interest rate of 12.625%.

According to the data, the financing cost of Blu-ray development is already very high.

This can not help but cause people in the industry to ask, how short of money is this hundreds of billions of housing enterprises?

Can the big increase in advance income be sustained?

Before answering this question, let's take a look at the latest performance report of Blu-ray Development.

According to the financial report, the company achieved an operating income of 39.194 billion yuan in 2019, an increase of 27.17% over the same period last year, and a total profit of 5.59 billion yuan, an increase of 65.53% over the same period last year.

Among them, the most eye-catching real estate business, realized sales amount of 101.537 billion yuan, consolidated statement of rights and interests sales amount of 71.54 billion yuan, accounting for 70.46%.

In view of the difference of 70.46% of equity and 49.11% of shareholders' equity (owner's equity) belonging to the parent company, on June 5, Blu-ray Development received an inquiry from the Shanghai Stock Exchange on the Supervision of the Information Disclosure of the 2019 Annual report of Sichuan Languang Development Co., Ltd.

Blu-ray Development said that the amount of equity sales in the consolidated statements refers to the project sales of subsidiaries within the scope of the company's consolidated statements, which is designed to help investors better match the company's future carryover income and the scale of operating cash rebates. As the proportion of equity sales in the consolidated statement is inconsistent with that of shareholders belonging to the parent company, the two indicators are not directly related to comparability, so there is a great difference in the proportion of equity.

Liu Yang, an industry official, pointed out that although Blu-ray's explanation is reasonable, the market seems to have different opinions.

Putting aside Blu-ray's own performance caliber, let's take a look at third-party data.

According to Carey data, in 2019, Blu-ray Development's full-caliber sales were 108 billion yuan, ranking 33rd among the top 100; in 2018, the amount of traffic realized by Blu-ray Development (no full-caliber statistics that year) was 104.2 billion yuan, ranking 27th on the list.

Also from Carey data, the amount of Blu-ray rights and interests in 2018 is 91.8 billion yuan, and Blu-ray trading sales in 2019 is 88 billion yuan (Corey statistics removed equity data and added trading data in 2019).

Estimated by two data, Blu-ray development in the past two years, "full-caliber sales" hovered at the 100 billion mark, industry ranking and equity data declined slightly.

As mentioned above, in response to an inquiry from the Shanghai Stock Exchange, Blu-ray pointed out that "consolidated statement equity data can help investors better match the size of the company's future carryover income and operating cash rebate."

From this point of view, the cash flow indicators behind the transaction volume, especially the importance of cash flow indicators generated by business activities, is self-evident.

According to the financial report, the net cash flow generated by Blu-ray development activities in 2019 was 3.83 billion yuan, up 732.6% from 460 million yuan in 2018.

On closer inspection, the operating cash flow bucked the trend, mainly due to a net increase of 4.3 billion in the item "Cash received in the sale of goods and services" (from 51.2 billion in 2018 to 55.5 billion in 2019).

Further investigation of Finance and Economics found that it was Blu-ray that focused on the increase in advance income, which changed the "miserable situation" of operating cash flow.

Take the advance payment as an example, the advance income of Blu-ray Development in 2019 was 68.2 billion yuan, compared with 51 billion yuan in 2018, a net increase of 17.2 billion yuan. "the net increase in advance income was 17.2 billion, resulting in a 3.8 billion net increase in cash flow from business activities, but the effect is not obvious."

Blu-ray said in an inquiry on the Shanghai Stock Exchange, "the increase in the balance of accounts received in advance is mainly related to the balance at the beginning of the period, the scale of advance receipts brought about by the increase in the amount of equity sales of the company in that year, and the carry-over situation in that year."

Financing encountered Waterloo

Operating cash flow can be collected in advance, but there are no shortcuts to investment and financing cash flow.

First, let's take a look at the cash flow of investment activities. The net cash flow generated by Blu-ray investment activities in 2019 is 9.7 billion yuan, which is not much different from the net outflow of 10 billion yuan in 2018.

Then there is the cash flow of fundraising. according to the financial report, the cash flow from Blu-ray development financing activities in 2019 is about 7 billion yuan, a net decrease of 14.4 billion yuan, or 67%, compared with 21.4 billion yuan in 2018.

The main reason for the decrease in financing is the decrease in financing and the increase in debt repayment. First, the cash obtained from Blu-ray development loans decreased from 36.5 billion yuan in 2018 to 29.9 billion yuan in 2019, a net decrease of 6.6 billion yuan; second, the cash required by Blu-ray development to repay debt increased significantly, from 26.1 billion yuan in 2018 to 38.5 billion yuan in 2019, with a net increase of 12.4 billion yuan.

With one increase and one decrease, it is a foregone conclusion that the financing cash flow of Blu-ray development has decreased significantly.

In particular, Blu-ray's short-term debt snowball seems to be getting bigger and bigger.

The current debt of Blu-ray Development was 124.6 billion yuan in 2019, a net increase of 49 percent from 83.5 billion yuan in 2018, according to the financial report.

At the same time, the monetary fund for Blu-ray development is about 26 billion yuan at the end of 2019, and nearly 1.6 billion yuan is restricted.

Short-term debt pressure, the main business sales can not grow rapidly, Blu-ray has to continue to increase financing efforts to ensure stable cash flow.

According to the financial report, Blu-ray Development has established strategic cooperation with 16 head office-level banks. During the reporting period, Blu-ray received corporate bond issuance approval of 2.9 billion yuan, private bond issuance approval of 2 billion yuan, and US dollar bond issuance approval of US $450 million. It also issued corporate bonds of 2.5 billion yuan, private debt of 700 million yuan, US dollar bonds of 750 million yuan, winning votes of 900 million yuan, and short-term financing bonds of 600 million yuan.

Nevertheless, judging from the overall borrowing situation in 2019, it will not be easy for Blu-ray Development to make a breakthrough in the financing market.

Therefore, raising the cost of financing has become a necessary means of Blu-ray.

As mentioned at the beginning of this article, it has become the norm for Blu-ray to develop high-cost financing. As shown in the chart below, the medium-and short-term bond financing of Blu-ray development is more than 7%.

The soil storage continues to run?

Although the road to Blu-ray financing is quite tortuous in 2019, the momentum of land acquisition has not diminished.

Data show that in 2019, Blu-ray Development added 11.21 million square meters of construction area through diversified land acquisition models such as mergers and acquisitions, cooperative development, industrial land acquisition and contract construction, accounting for 63% of the total building area to be developed at the end of 2019.

According to the public data collation, the development speed of Blu-ray soil storage gradually slowed down in 2020.

In January, Blu-ray Development bought three plots of land in Changzhou, Yantai and Xianyang for 799 million yuan, totaling 110mu. In February, Blu-ray invested 340 million yuan to acquire the Taizhou plot, with an equity area of about 35 mu.

In March, Blu-ray Development won seven real estate development projects with 2.52 billion yuan. According to the proportion of rights and interests, Blu-ray takes more than 250 mu of land.

In April, Blu-ray Development added nine new plots, which cost more than 7.7 billion yuan and took more than 770 mu of land this month according to the proportion of rights and interests.

In May, Blu-ray Development added four new plots, which cost more than 1.8 billion yuan and took more than 344 mu of land this month according to the proportion of rights and interests.

According to rough statistics, before May 2020, the cumulative cost of Blu-ray development exceeded 13.1 billion yuan, with a land scale of more than 1500 mu, or about 1 million square meters.

"judging from the pace of taking land, whether it is the amount of land storage or the scale of land, the speed of Blu-ray development has slowed down, which is related to the current situation of the development of the real estate industry as a whole," the analyst pointed out. But in the final analysis, it has something to do with Blu-ray's increasingly tight cash flow. "

By the end of 2019, Blu-ray had more than $73.2 billion in assets restricted by loan mortgages / mortgages.

On June 23, the Blu-ray Development announcement showed that the total amount of money to be used would not exceed 300 million yuan to raise funds idle to temporarily replenish the company's liquidity, with a service life of no more than 6 months.

It is not difficult to find that the top priority in front of Blu-ray is still the difficulty of liquidity.

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