These 4 Measures Indicate That Hunan Valin Steel (SZSE:000932) Is Using Debt Extensively
These 4 Measures Indicate That Hunan Valin Steel (SZSE:000932) Is Using Debt Extensively
Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously said that 'Volatility is far from synonymous with risk.' So it seems the smart money knows that debt - which is usually involved in bankruptcies - is a very important factor, when you assess how risky a company is. Importantly, Hunan Valin Steel Co., Ltd. (SZSE:000932) does carry debt. But should shareholders be worried about its use of debt?
有人说,波动性,而不是债务,是投资者思考风险的最佳方式,但沃伦·巴菲特曾说过一句名言:“波动性远非风险的代名词。”因此,当你评估公司的风险时,看来聪明的货币知道债务(通常涉及破产)是一个非常重要的因素。重要的是,湖南华菱钢铁有限公司(深圳证券交易所代码:000932)确实有债务。但是,股东是否应该担心其债务的使用?
When Is Debt A Problem?
债务何时会成为问题?
Generally speaking, debt only becomes a real problem when a company can't easily pay it off, either by raising capital or with its own cash flow. In the worst case scenario, a company can go bankrupt if it cannot pay its creditors. However, a more usual (but still expensive) situation is where a company must dilute shareholders at a cheap share price simply to get debt under control. By replacing dilution, though, debt can be an extremely good tool for businesses that need capital to invest in growth at high rates of return. When we examine debt levels, we first consider both cash and debt levels, together.
一般而言,只有当公司无法通过筹集资金或利用自己的现金流轻松偿还债务时,债务才会成为真正的问题。在最坏的情况下,如果一家公司无法向债权人付款,它可能会破产。但是,更常见(但仍然昂贵)的情况是,公司必须以低廉的股价稀释股东才能控制债务。但是,通过取代稀释,对于需要资本以高回报率投资增长的企业来说,债务可能是一个非常好的工具。当我们检查债务水平时,我们首先要同时考虑现金和债务水平。
What Is Hunan Valin Steel's Net Debt?
湖南华菱钢铁的净负债是多少?
You can click the graphic below for the historical numbers, but it shows that as of September 2023 Hunan Valin Steel had CN¥21.3b of debt, an increase on CN¥15.7b, over one year. However, it does have CN¥7.37b in cash offsetting this, leading to net debt of about CN¥13.9b.
你可以点击下图查看历史数字,但它显示,截至2023年9月,湖南华菱钢铁在一年内有213亿元人民币的债务,比157亿元人民币有所增加。但是,它确实有737亿加元的现金抵消了这一点,净负债约为139亿元人民币。
![debt-equity-history-analysis](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240229/0-c55d7405addcbbf1863619b2639f2a16-0-cbcfd9c553683d5b62210129e2141bd6.png/big)
How Healthy Is Hunan Valin Steel's Balance Sheet?
湖南华菱钢铁的资产负债表有多健康?
The latest balance sheet data shows that Hunan Valin Steel had liabilities of CN¥51.3b due within a year, and liabilities of CN¥16.3b falling due after that. On the other hand, it had cash of CN¥7.37b and CN¥16.1b worth of receivables due within a year. So it has liabilities totalling CN¥44.1b more than its cash and near-term receivables, combined.
最新的资产负债表数据显示,湖南华菱钢铁的负债为513亿元人民币,此后到期的负债为163亿元人民币。另一方面,它有73.7亿加元的现金和价值161亿元人民币的应收账款将在一年内到期。因此,它的负债总额为441亿元人民币,超过了现金和短期应收账款的总和。
Given this deficit is actually higher than the company's market capitalization of CN¥39.0b, we think shareholders really should watch Hunan Valin Steel's debt levels, like a parent watching their child ride a bike for the first time. In the scenario where the company had to clean up its balance sheet quickly, it seems likely shareholders would suffer extensive dilution.
鉴于这一赤字实际上高于该公司390亿元人民币的市值,我们认为股东们确实应该关注湖南华菱钢铁的债务水平,就像父母第一次看着孩子骑自行车一样。在公司必须迅速清理资产负债表的情况下,股东似乎可能会遭受大规模稀释。
We use two main ratios to inform us about debt levels relative to earnings. The first is net debt divided by earnings before interest, tax, depreciation, and amortization (EBITDA), while the second is how many times its earnings before interest and tax (EBIT) covers its interest expense (or its interest cover, for short). Thus we consider debt relative to earnings both with and without depreciation and amortization expenses.
我们使用两个主要比率来告知我们相对于收益的债务水平。第一个是净负债除以利息、税项、折旧和摊销前的收益(EBITDA),第二个是其利息和税前收益(EBIT)覆盖其利息支出(或简称利息保障)的多少倍。因此,我们将债务与收益的关系考虑在内,包括和不包括折旧和摊销费用。
Hunan Valin Steel has a low debt to EBITDA ratio of only 1.3. And remarkably, despite having net debt, it actually received more in interest over the last twelve months than it had to pay. So it's fair to say it can handle debt like a hotshot teppanyaki chef handles cooking. On the other hand, Hunan Valin Steel's EBIT dived 19%, over the last year. If that rate of decline in earnings continues, the company could find itself in a tight spot. When analysing debt levels, the balance sheet is the obvious place to start. But it is future earnings, more than anything, that will determine Hunan Valin Steel's ability to maintain a healthy balance sheet going forward. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.
湖南华菱钢铁的债务与息税折旧摊销前利润的比率很低,仅为1.3。值得注意的是,尽管有净负债,但它在过去十二个月中获得的利息实际上超过了必须支付的利息。因此,可以公平地说,它可以像炙手可热的铁板烧厨师处理烹饪一样处理债务。另一方面,湖南华菱钢铁的息税前利润比去年下降了19%。如果收益的下降速度持续下去,该公司可能会陷入困境。在分析债务水平时,资产负债表是显而易见的起点。但是,未来的收益将决定湖南华菱钢铁未来保持健康资产负债表的能力。因此,如果你想看看专业人士的想法,你可能会发现这份关于分析师利润预测的免费报告很有趣。
Finally, a company can only pay off debt with cold hard cash, not accounting profits. So it's worth checking how much of that EBIT is backed by free cash flow. During the last three years, Hunan Valin Steel produced sturdy free cash flow equating to 52% of its EBIT, about what we'd expect. This free cash flow puts the company in a good position to pay down debt, when appropriate.
最后,公司只能用冷硬现金偿还债务,不能用会计利润偿还债务。因此,值得检查一下息税前利润中有多少是由自由现金流支持的。在过去三年中,湖南华菱钢铁产生了稳健的自由现金流,相当于其息税前利润的52%,与我们的预期差不多。这种自由现金流使公司处于有利地位,可以在适当的时候偿还债务。
Our View
我们的观点
Mulling over Hunan Valin Steel's attempt at (not) growing its EBIT, we're certainly not enthusiastic. But at least it's pretty decent at covering its interest expense with its EBIT; that's encouraging. Once we consider all the factors above, together, it seems to us that Hunan Valin Steel's debt is making it a bit risky. Some people like that sort of risk, but we're mindful of the potential pitfalls, so we'd probably prefer it carry less debt. There's no doubt that we learn most about debt from the balance sheet. However, not all investment risk resides within the balance sheet - far from it. Case in point: We've spotted 1 warning sign for Hunan Valin Steel you should be aware of.
仔细考虑湖南华菱钢铁试图(不是)增加息税前利润,我们当然并不热情。但至少它在用息税前利润支付利息支出方面相当不错;这令人鼓舞。综合考虑上述所有因素,在我们看来,湖南华菱钢铁的债务使其有点风险。有些人喜欢这种风险,但我们注意到了潜在的陷阱,因此我们可能更希望它承担较少的债务。毫无疑问,我们从资产负债表中学到的关于债务的知识最多。但是,并非所有的投资风险都存在于资产负债表中,远非如此。一个很好的例子:我们发现了湖南华菱钢铁的1个警告标志,你应该注意。
If you're interested in investing in businesses that can grow profits without the burden of debt, then check out this free list of growing businesses that have net cash on the balance sheet.
如果你有兴趣投资能够在没有债务负担的情况下增加利润的企业,请查看这份资产负债表上有净现金的成长型企业的免费清单。
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