Here's Why Shanghai Awinic TechnologyLtd (SHSE:688798) Can Manage Its Debt Responsibly
Here's Why Shanghai Awinic TechnologyLtd (SHSE:688798) Can Manage Its Debt Responsibly
Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of permanent loss is the risk I worry about... and every practical investor I know worries about.' When we think about how risky a company is, we always like to look at its use of debt, since debt overload can lead to ruin. We can see that Shanghai Awinic Technology Co.,Ltd. (SHSE:688798) does use debt in its business. But is this debt a concern to shareholders?
霍华德·马克思说得很好,与其担心股价波动,"我担心的是永久性损失的可能性...我认识的每一个实际投资者都在担心这个。" 当我们考虑一家公司有多大风险时,我们总是喜欢看看它的债务使用情况,因为债务过载可能导致毁灭。我们可以看到上海艾为科技股份有限公司(SHSE:688798)的业务确实使用了债务。但这笔债务会让股东担忧吗?
When Is Debt Dangerous?
债务何时有危险?
Debt and other liabilities become risky for a business when it cannot easily fulfill those obligations, either with free cash flow or by raising capital at an attractive price. Ultimately, if the company can't fulfill its legal obligations to repay debt, shareholders could walk away with nothing. However, a more common (but still painful) scenario is that it has to raise new equity capital at a low price, thus permanently diluting shareholders. Of course, debt can be an important tool in businesses, particularly capital heavy businesses. When we examine debt levels, we first consider both cash and debt levels, together.
当企业无法通过自由现金流或以有吸引力价格筹集资本来轻松履行债务义务时,债务和其他负债对企业而言就变得风险重重。最终,如果公司无法履行偿还债务的法定义务,股东可能一无所有。然而,更常见(但仍然痛苦)的情况是,公司不得不以低价格筹集新的股本,从而永久稀释股东的权益。当然,债务可以是企业中的重要工具,尤其是在资本密集型企业中。在我们审视债务水平时,我们首先要考虑现金和债务水平。
What Is Shanghai Awinic TechnologyLtd's Debt?
上海艾为科技有限公司的债务是多少?
As you can see below, Shanghai Awinic TechnologyLtd had CN¥597.7m of debt at September 2024, down from CN¥666.7m a year prior. But on the other hand it also has CN¥2.21b in cash, leading to a CN¥1.61b net cash position.
正如您下面所见,上海艾为科技有限公司在2024年9月的债务为59770万元人民币,比去年同期的66670万元人民币有所下降。但另一方面,它也有22.1亿的现金,导致净现金头寸为16.1亿。
How Strong Is Shanghai Awinic TechnologyLtd's Balance Sheet?
上海奥威科技有限公司的资产负债表有多强?
We can see from the most recent balance sheet that Shanghai Awinic TechnologyLtd had liabilities of CN¥911.4m falling due within a year, and liabilities of CN¥163.7m due beyond that. On the other hand, it had cash of CN¥2.21b and CN¥80.2m worth of receivables due within a year. So it can boast CN¥1.22b more liquid assets than total liabilities.
我们可以从最近的资产负债表看到,上海奥威科技有限公司有到期债务为91140万人民币,到期后不久为16370万人民币。 另一方面,它有22.1亿人民币的现金和8020万人民币的应收账款。 因此,它可以夸耀比总负债多12.2亿人民币的流动资产。
This surplus suggests that Shanghai Awinic TechnologyLtd has a conservative balance sheet, and could probably eliminate its debt without much difficulty. Simply put, the fact that Shanghai Awinic TechnologyLtd has more cash than debt is arguably a good indication that it can manage its debt safely.
这种盈余表明上海奥威科技有限公司有保守的资产负债表,可能可以毫不费力地清除其债务。 简而言之,上海奥威科技有限公司拥有比债务更多的现金可以安全管理债务的事实,可能是一个好的迹象。
It was also good to see that despite losing money on the EBIT line last year, Shanghai Awinic TechnologyLtd turned things around in the last 12 months, delivering and EBIT of CN¥247m. There's no doubt that we learn most about debt from the balance sheet. But ultimately the future profitability of the business will decide if Shanghai Awinic TechnologyLtd can strengthen its balance sheet over time. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.
看到尽管去年在EBIt线上亏损,但上海奥威科技有限公司在过去12个月扭亏为盈,实现了24700万人民币的EBIt。 从资产负债表上我们可以了解大部分债务的情况。 但最终业务的未来盈利能力将决定上海奥威科技有限公司能否长期加强其资产负债表。 因此,如果您想了解专业人士的看法,您可能会对方面利润预测的分析师免费报告感兴趣。
Finally, a company can only pay off debt with cold hard cash, not accounting profits. While Shanghai Awinic TechnologyLtd has net cash on its balance sheet, it's still worth taking a look at its ability to convert earnings before interest and tax (EBIT) to free cash flow, to help us understand how quickly it is building (or eroding) that cash balance. In the last year, Shanghai Awinic TechnologyLtd created free cash flow amounting to 5.6% of its EBIT, an uninspiring performance. For us, cash conversion that low sparks a little paranoia about is ability to extinguish debt.
最后,一家公司只能用冰冷的现金偿还债务,而不是会计利润。 尽管上海奥威科技有限公司的资产负债表上有净现金,但仍值得看一看其将息税折旧摊销前利润(EBIT)转化为自由现金流的能力,以帮助我们了解其构建(或侵蚀)现金余额的速度。 在过去一年中,上海奥威科技有限公司创造了相当于其EBIt的5.6%的自由现金流,表现不佳。 对于我们来说,这么低的现金转换率对其熄灭债务的能力引发了一些担忧。
Summing Up
总之
While we empathize with investors who find debt concerning, you should keep in mind that Shanghai Awinic TechnologyLtd has net cash of CN¥1.61b, as well as more liquid assets than liabilities. So we don't have any problem with Shanghai Awinic TechnologyLtd's use of debt. The balance sheet is clearly the area to focus on when you are analysing debt. But ultimately, every company can contain risks that exist outside of the balance sheet. We've identified 2 warning signs with Shanghai Awinic TechnologyLtd , and understanding them should be part of your investment process.
尽管我们理解投资者对债务感到担忧,但您应该记住,上海艾为尼科科技有限公司拥有16.1亿人民币的净现金,以及比负债更多的流动资产。所以,我们对上海艾为尼科科技有限公司使用债务并没有任何问题。资产负债表显然是在分析债务时要关注的重点。但最终,每家公司都可能存在超出资产负债表之外的风险。我们已经发现了上海艾为尼科科技有限公司的2个警示信号,了解它们应该成为您投资过程的一部分。
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.
如果您有兴趣投资能够在不负债的情况下增长利润的企业,请查看这份免费列表,其中列出了在资产负债表上拥有净现金的成长型企业。
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