Nan Fang Du Shi Bao·2025-06-16 12:09Core Viewpoint - Chenming Paper Industry is facing significant financial difficulties, including continuous losses and debt defaults, leading to the postponement of board and supervisory board elections [2][3][7]. Group 1: Financial Performance - Chenming Paper achieved a historical revenue peak of 33.02 billion yuan in 2021, with a net profit of 1.744 billion yuan, but has since entered a downward trend [3]. - From 2022 to 2024, the company's revenues decreased from 32 billion yuan to 22.73 billion yuan, while net profits turned negative, resulting in cumulative losses of 9.505 billion yuan [3][4]. - As of November 18, 2024, the company and its subsidiaries had overdue debts totaling 1.82 billion yuan, with an additional 574 million yuan in overdue guarantees [3][7]. Group 2: Operational Challenges - The paper industry is experiencing pressure due to an influx of new production capacity, leading to a significant decline in paper prices, particularly for white card paper, which has severely impacted profitability [5]. - Revenue from the white card paper segment dropped from 9.061 billion yuan in 2022 to 4.553 billion yuan in 2024, with corresponding gross margins falling from 13.63% to -12.91% [5]. Group 3: Financial Diversification Issues - In 2013, Chenming Paper diversified into financial services, including finance companies and leasing, but these ventures have not yielded positive results [6]. - By the end of 2024, the company had recognized impairment losses totaling 4.6 billion yuan related to receivables from financing leases and factoring [7]. Group 4: Environmental and Regulatory Issues - Chenming Paper's subsidiary faced environmental scrutiny due to pollution complaints, leading to operational disruptions and a commitment to invest 130 million yuan in pollution control measures [13]. - The company is currently working on revising its internal regulations and preparing for board elections, which have been postponed due to these ongoing challenges [7][14]. Group 5: Shareholder and Debt Situation - Chenming Holdings, the controlling shareholder, has seen its shares heavily frozen, with 3.041 billion shares frozen, representing 370.9% of its holdings [12]. - The company is actively negotiating with creditors to extend and reduce interest on its debts, with 84% of its financial liabilities already under such arrangements [14].