SMM News: recently, * ST Jiangte announced that the company intends to transfer the company's 97.4528% stake in Jiangxi Jiangte Lithium Battery Materials Co., Ltd. (hereinafter referred to as "Jiangte Lithium Power") with 98.7271 million yuan. It is reported that this is the second recent asset sale of * ST Jiangte. After two consecutive years of losses in 2018 and 2019, * ST Jant is planning to sell assets in an effort to "preserve its shell".
It is understood that in 2019, * ST Jiangte achieved operating income of 2.595 billion yuan, down 14.00% from the same period last year; the net profit attributed to the parent company was-2.024 billion yuan, down 21.92% from the same period last year. * ST Jant said that the company's business environment did not improve significantly in 2019 due to domestic financial deleveraging, policy changes in new energy vehicles, a sharp decline in the price of lithium carbonate and frictions in foreign trade relations. Among them, the company's lithium carbonate business achieved an operating income of 487 million yuan in 2019, an increase of 35.81% over the same period last year, but the gross profit margin fell 104.67% year-on-year, the price of lithium carbonate continued to decline, and the profitability of lithium carbonate products decreased significantly.
Coupled with the impact of traditional motors, servo motors, new energy vehicles and other business operations, the company suffered huge losses in 2019.
It is worth mentioning that due to the adjustment of the subsidy policy for new energy vehicles and the postponement of subsidy funds, the new energy vehicle industry continues to occupy * ST Jiangte funds, and the company's automobile business continues to lose money and is difficult to improve in the short term. * ST Jiangte decided to withdraw from the automobile industry in 2019 and completed the transfer of its 100% equity stake in Kowloon Motor Co.
However, the simple divestiture of the automobile business does not seem to make its performance report better. The divestment of Jant Lithium business will reduce the loss impact of the business on the one hand and improve its financial statements on the other.
It is reported that Jiangte Lithium Power system * ST Jiangte's controlling subsidiary, * ST Jiangte and another natural person shareholder Zhong Shengwen own 97.4528% and 2.5472% of Jiangte Lithium respectively.
The data show that Jiangte Lithium Power's main business includes the development, manufacture and sales of lithium-ion batteries, battery packs, cathode materials, anode materials and their precursors and other lithium products. In 2019 and January-May 2020, the operating income of Jiangte Lithium Power was about 72.379 million yuan and 13.2564 million yuan respectively, and the corresponding net profit in the current period was about-6.1589 million yuan and-3.2936 million yuan respectively.
According to * ST Jiangte, the company, Zhong Shengwen and Shanghai Eneng Enterprise Management Partnership (Limited Partnership) and other transferees signed an "equity transfer agreement" for the transfer of 100% equity in Jiangte Lithium Power, with a transfer price of 101 million yuan, of which the transfer price corresponding to * ST Jiangte's 97.4528% stake reached 98.7271 million yuan.
* ST Jant said that the sale of Jiangte Lithium stake is in line with the company's development strategy of focusing on the motor industry and lithium salt industry, and can increase the company's cash flow. Among them, "this sale of Jiangte Lithium stake is expected to increase the company's net profit by 7.3274 million yuan in 2020."
On the same day, * ST Jiangte also announced another asset sale. The company plans to transfer 84.15 million yuan (51%) of its wholly-owned subsidiary, Shanghai Jiangshan Industrial Co., Ltd. (hereinafter referred to as "Jiangshang Industry"), to Shanghai Enbase Investment Management Co., Ltd., and the company will no longer hold shares in Shanghai Jiangshan after the completion of the transfer.
* ST Jiangte said that after the sale of Jiang Shang's stake, the company can better focus on the development strategy of the motor industry and lithium salt industry, invigorate the company's assets and increase the company's cash flow. The sale of Jiangshang Industries is expected to increase the company's net profit by 24.5154 million yuan in 2020, providing some support for improving the company's performance.
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