[Comprehensive] The loss of employees, half of the plant shutdown, debt 3 billion! The brand Lu Yi endorsed was dangerous

Fujian is a famous province of garment manufacturing in China. In addition to Putian, which is famous for its production of “shanzhai”, domestic well-known brands like Hudu, Cabin, Septwolves, Delphi, and Fortune Bird were born.

However, these so-called Shu school outfits are not very good at present. In 2016, for example, Tiger Capital’s revenue decreased by 36.7%; Carbin’s annual revenue declined by 14.4%. At the same time, seven wolf’s net profit also declined.

Worse still, not long ago, Delphi was suspended from business due to debts of several hundred million yuan. In recent days, the rich bird has encountered major troubles.

On March 22, Fugui Bird (1819, HK) issued an announcement on the receipt of notice of investigation by the China Securities Regulatory Commission. The announcement pointed out that

Due to the company's alleged disclosure of information and the use of funds raised from the bond to violate the rules and regulations, in accordance with relevant regulations, I will decide to investigate your company.

Once a wealthy bird of Fujian's shoe and clothing leader, it had experienced double-digit rapid growth before listing. Now according to the report of Guotai Junan, the total debt of Fugui Bird has reached RMB 3 billion. After all, what did the rich bird experience?

Serious staff loss, half of the workshop was shut down

At noon on March 21, the Daily Economic News (Micro Signal: nbdnews) reporter visited the headquarters of Fugui Bird in Shishi, Fujian.

Outside the Fortune Bird Staff Quarters, the reporter saw a recruitment billboard on the Fugui Bird says: The Women's Shoes Department recruits 400 shoe-making operators to the community. Across the gate, the reporter saw a staff member at the company's recruitment desk, but did not see anyone applying.

Photo source: Daily Economic News Yu Feng / photo

The reporter walked into the staff quarters of Fortune Bird and found that almost all of the dormitory doors were closed.

Xiao Liu, a 17-year-old employee from Fuyang, Anhui, said that the factory now has very few employees and the entire dormitory is vacant. Xiao Liu has been in the rich bird for a year now. Now he belongs to the gang department. He is still quite satisfied with the current working conditions. "There was only a thousand wages when I first came in. There were more than two thousand in the second month. Now the salary is over 3,000."

Another employee, Ronaldinho, said, “The people in the four workshops are not as tall as one workshop during the peak period.” The peak Ronald mentioned was in 2013 and 2014. At that time, the staff of the Fortune Bird headquarters factory had more than 1,000 employees, and now Only a few hundred people.

As Ronald said, the reporter saw a total of four workshops at the Fortigens headquarters factory. At present, only the first workshop and the second workshop have employees working. The machines in the third workshop and the fourth workshop have been shut down and many machines have been placed. Aisle outside the workshop.

Photo source: Daily Economic News Yu Feng / photo

Wang Yaohui (a pseudonym) of the second workshop's skin group told reporters that the original ten workers in his skinning group have now gone 78. And he himself, although not much time to come in, but also ready to leave next month.

Worker Xu Xiao told reporters that the rich birds recruited workers in many places after the year, and there were more than 20 Yunnan workers who came in at the same time. They did not resign for a long time.

Daily economic news (micro-signal: nbdnews) The reporters found that the full annual report issued by Fugui Bird since listing in 2013 found that the number of employees of Fugui Bird has been on a downward trend. On June 30, 2014, the company had 5729 full-time employees, At the end of that year, this figure was reduced to 5,170. By December 31, 2015, the company had employed a total of 4,401 full-time employees. The current 2017 data has not yet been announced.

Why are the employees of Rich Bird less and less?

It is not that the factory did not work, but that the original workers could not keep it, and the wanted workers did not. This was not unrelated to the current operating status of the rich bird. Wang Yaohui said that he had chosen to leave the rich bird because the factory had a poor performance, and now he only received more than two thousand wages. This level of wages is nowadays not really competitive.

Many workers also claimed that another shoe company in the same city of Shishi was treated better than this. Many workers chose to go to another company.

Worker Chen Chao (a pseudonym) worked for Fortune Bird for ten years. When he talked about the rich bird of the past, his face still showed a proud expression. He said that when he first entered the rich bird, he had more than two thousand wages. “The money at that time was worth more than it is now. This level of wages is high in the local area. Many of the ideal places for shoe-workers are rich birds."

Photo source: rich bird website screenshot

Indeed, the rich bird has also had a glorious period. It is understood that Fortune Bird Co., Ltd. was established in the 1990s and is mainly engaged in the research and development, production and sales of men's and women's leather shoes, men's business casual wear and leather accessories and other related accessories. The controlling shareholder of the company is Fortune Bird Group Co., Ltd. The ratio of shares held by the company as of the end of 2015 was 68.9%. The actual controllers were Lin Heping, Lin Heshi, Lin Guoqiang, and Lin Ronghe. This is a typical family business.

In 2013, Fortune Bird landed on the Hong Kong Stock Exchange. Prior to the listing, Fortune Bird had experienced double-digit growth. From 2011 to 2013, the net profit of Fortune Bird increased by 113.79%, 27.47% and 37.13% respectively.

However, from 2014, rich bird's performance began to show signs of decline. According to the financial data for 2014-2017, the wealthy bird net profit for 2014 was 451 million yuan, an increase of only 1.69% year-on-year; net profit for 2015 was 392 million yuan, a year-on-year decrease of 13.09%; 2016 net profit decreased by approximately 59.16% to 162 million yuan.

Since the listing, the operating income of Fugui Bird also showed a declining trend. In 2014, the turnover of Fugui Bird was RMB 2.323 billion. In 2015, it was RMB 2.032 billion. In 2016, it decreased again to RMB 1.492 billion. The results of the 2017 annual report show that during the reporting period Operating income was only 412 million yuan.

In response to the declining performance, Fugui bird explained in the 2015 financial report that the shoe and clothing industry is still at the bottom stage due to the influence of the macroeconomic situation and the development cycle of the shoe and clothing industry.

Photo source: Daily Economic News Yu Feng / photo

As a veteran shoe-making enterprise, Fortune Bird also tried to transform and diversify. For example, it tried to use the school uniform as a breakthrough to gradually enter the children's footwear market. It also set up an e-commerce team to promote online business. However, from now on, these deployments are not enough to reverse the trend. In the first half of 2017, the performance of the wealthy bird went awry again, and its revenue realized was approximately RMB 412 million, a decrease of 48.09% year-on-year.

Bear huge debts to the government to take over the rich bird

Shishi is China's shoe and clothing manufacturing base. According to figures from the Shishi City Bureau of Statistics, in 2017, there are nearly 100 shoe and clothing companies with annual sales exceeding RMB 100 million. Among them, Fortune Bird was once the leading company of Shishi.

When entering the Fugui Industrial Park on Baqi Road in Shishi city, the head office building still has cars coming in and there are security guards on duty at the security kiosk at the entrance. The orderly flow of people does not conceal the crisis behind the rich bird. The reporter learned from a number of sources that the Shishi City government has sent people to the rich bird to take over the business.

The crisis of the rich bird has become an “open secret” in the local area. Local authorities said that the founder and executive director of the rich bird Lin Guoqiang passed away in June 2017, but his children gave up his right to inherit, in order to avoid the company’s huge debt.

So, how much debt does Rich Bird have? According to the report of Guotai Junan, the wealthy bird has at least 4.909 billion yuan in assets may not be able to recover, including currency funds 165 million yuan, accounts receivable 200 million yuan, inventory of 200 million yuan, other receivables 4.229 billion yuan, 115 million yuan in fixed assets yuan.

Photo source: rich bird website screenshot

At present, the total amount of debt of Fugui Bird is approximately RMB 3 billion, including the “14 rich bird” principal of RMB 800 million and the corresponding interest, “16 Fugui 01” principal of RMB 1.3 billion and corresponding interest, bank loan of approximately RMB 500 million, and other operating liabilities. 300 million yuan.

The “14 Rich Birds,” which relapsed in March, was the corporate bond issued by Fugui Bird in April 2015, with a total issuance of 800 million yuan and a term of 5 years. With the end of the third year, the issuer raised the coupon rate option and the investor's option to sell back. In April this year, the bond will usher in the date of return sale.

On the eve of the resumption of the "14 Rich Birds", the bond rating agency Oriental Jincheng International Credit Evaluation Co., Ltd. disclosed on February 12, 2018, "Oriental Jincheng's announcement on downgrading the main body of Fugui Bird Co., Ltd. and the credit rating of "14 Fugui Birds"". The wealth bird's credit rating was downgraded to CC level, maintaining its rating outlook as negative, while downgrading the “14 Fugui” bond's credit rating to CC level. The CC class means that "there is little protection in bankruptcy or reorganization, and basically no guarantee of debt repayment".

In addition, the issuer set up by Fugui Bird's 1.3 billion yuan private placement bond “16 Fugui 01” increased the coupon interest rate option and the investor’s exercise of the option to sell back options on August 12, 2018, further aggravating the payment pressure.

In fact, the two cases of the sale and purchase contract dispute on Fugui Bird in 2017 seem to indicate that the current financial situation of Fugui Bird is in a very tense state.

Photo source: Oriental IC

In November 2017, Fujian Jinjiang Fuxing Zipper Co., Ltd. filed a lawsuit against Fugui Birds, requesting that Fugui Birds be paid for Fuxing Company by RMB 56790.34; in December of the same year, Foshan Nanhai Carve New Shoes Co., Ltd. filed a lawsuit against Fugui Birds and requested that the Fugui Birds be paid off. 58.86 million yuan and interest.

In the above two cases, the rich bird did not reply, and the handling court sentenced Fugui to pay the plaintiff.

In response to the company’s current financial situation, the Daily Economic News (Micro Signal: nbdnews) reporter has repeatedly called the public bird company’s public phone, but it has not been answered.