Xinlong Holdings (Group) Co., Ltd. (hereinafter referred to as “Xinlong Holdings”) 9 is an important raw material manufacturer for protective clothing and masks and one of the largest domestic suppliers. A non-public stock issuance plan was released on the evening of March 16. The company plans to raise 668 million yuan. After deducting issuance expenses, it will invest in medical and sanitary material manufacturing projects, an 8,000-ton spunlace nonwoven material production line project, supplement the company’s working capital and repay bank loans. , including a total investment of 218 million yuan in the medical and hygienic material manufacturing project, a total investment of 131 million yuan in the 8,000-ton spunlace nonwoven material production line project with an annual output, and a total investment of 318 million yuan in supplementing working capital and repaying bank loans.
The announcement shows:
The implementation entity of the medical and hygienic materials manufacturing project is the company’s holding subsidiary Yichang Xinlong Hygiene Materials Co., Ltd. ( (hereinafter referred to as “Yichang Sanitary Materials”). The products produced after the completion of the project construction are mainly medical and sanitary non-woven materials. The total investment scale is approximately 248 million yuan, of which a total of 218 million yuan is for engineering construction costs and equipment purchase and installation costs. It is planned to invest in raising funds The capital is 218.5295 million yuan.
The project construction period is 18 months. After the project construction is completed and fully reaches production, it is expected to achieve an average annual sales revenue of 406 million yuan and an average annual net profit of no less than 53.3513 million yuan.
The 8,000-ton-annual spunlace nonwoven material production line project is implemented by Hainan Xinlong Nonwoven Co., Ltd., a wholly-owned subsidiary of the company. The project products are mainly high-end wipes, wet wipes and facial mask bases. The total investment scale of the project is approximately 149 million yuan, of which 131 million yuan is for engineering construction costs and equipment purchase and installation costs, and 131 million yuan of raised funds is planned to be invested.
The project plans to build a spunlace nonwoven material production line with an annual output of 3,000 tons and a spunlace nonwoven material production line with an annual output of 5,000 tons. The project construction period will be 18 months. After the project construction is completed and fully reached production , it is expected to achieve an average annual sales revenue of 135 million yuan and an average annual net profit of no less than 20 million yuan.
In addition, Xinlong Holdings plans to use the 318 million yuan raised from this non-public issuance of A shares to supplement working capital and repay bank loans to meet the growing working capital needs of future business.
Xinlong Holdings stated that as the company’s scale increases, in order to meet the company’s capital needs during its development, the company mainly raises funds through bank borrowings and other methods. As of June 30, 2020, the balance of bank borrowings exceeded 450 million yuan, of which more than 300 million yuan needs to be repaid in the next year, and the repayment pressure is high; in the past three years, the company’s annual interest expenses have exceeded 25 million yuan, and the financial The burden is heavier. Therefore, raising funds to repay part of the bank loans will help ease the company’s debt repayment pressure, reduce financial costs, and improve the company’s profitability.
Xinlong Holdings stated that this new project adopts the company’s latest technology, and the process is advanced and efficient. After being put into production, it will not only improve the production efficiency of the company’s high-end spunlace products, expand its business scale, improve its product structure, and enhance its products quality, further enhance the scale effect, and at the same time, it will also reduce production costs, increase product added value and cost performance, enhance the overall market competitiveness of the company’s products, and better meet the needs of domestic and foreign customers for the company’s products.
Public information shows that Xinlong Holdings is mainly engaged in the research and development, production and sales of high-end nonwoven materials. The company is the first domestic enterprise to introduce spunlace nonwoven material manufacturing technology, and has first-mover advantages in the industry. So far, more than ten production lines have been built and put into operation, including spunlace, composite spunlace, SMS, SSS, melt-blown, finishing and non-woven deep processing. The production scale has reached the leading level in the domestic high-end nonwoven materials market. The company has long been supplying products to many well-known domestic and foreign companies such as Kimberly-Clark, DuPont, Myron, Berry International, and Australian CL, and has established long-term and stable cooperative relationships.
Hunan Xinlong Non-Manufacturing Materials Co., Ltd., a subsidiary of Xinlong Holdings, mainly develops, produces and sells SMS, SSS and other series of non-woven fabrics. The Hainan base and Hubei base have separate melt-blown production lines. . The market positioning of the company’s melt-blown nonwoven products is mainly mid- to high-end.
In the first half of 2020, Xinlong Holdings achieved operating income of 790 million yuan, a year-on-year increase of 99.4%; the net profit attributable to the parent company was 160 million yuan, compared with -6.564 million yuan in the same period last year, turning a loss into a profit year-on-year.
From the perspective of business structure, melt-spun products are the main source of operating income of Xinlong Holdings. During the reporting period, the operating income of melt-spun products was 400 million, accounting for 50.5% of the revenue, and the gross profit margin was 79%.
As for the reasons for the performance changes during the reporting period, Xinlong Holdings explained that the market demand for medical and health protection materials increased. , leading to a substantial increase in sales revenue. </p
