Faced with debt pressure and huge lossesCanadianpokersitesJinke shares (000656) took the initiative toCanadianpokersitesWent bankrupt and reorganized. On the evening of April 22nd, Jinke shares issued a notice that the company received the Civil order No. 129and (2024) Yu05 Bushen No. 2024 served by the Chongqing Fifth Intermediate people's Court (hereinafter referred to as "Chongqing Fifth Intermediate people's Court"). The Chongqing five Intermediate people's Court ruled to accept the application for the reorganization of Jinke shares. At this point, Jinke shares have also become the first A-share in recent years to formally enter the restructuring process of large-scale listed housing enterprises.

Jinke's quarterly report for 2023 shows that its total liabilities are 227.1 billion yuan, of which 350 are non-current liabilities due within one year.Canadianpokersites60 million yuan. In addition, Jinke shares also suffered huge losses, with a net profit loss of 213 in 2022.Canadianpokersites92 million yuan, down 694.13% from the same period last year, and the net loss in 2023 is expected to be 4.8 billion-7.8 billion yuan.

Restructure the fuse throw

Take the initiative to propose bankruptcy reorganization, Jinke shares in listed real estate enterprises are still a minority.

On July 31, 2023, the board of directors and the board of supervisors of Jinke shares examined and passed the "motion on applying to the court for reorganization and pre-reorganization", and the board of directors agreed that the company should apply to the people's court with jurisdiction for reorganization and pre-reorganization.

On February 21, 2024, Jinke shares formally submitted the relevant materials of the reorganization application to the Fifth Intermediate people's Court of Chongqing, and the Fifth Intermediate people's Court received the company's reorganization application materials after examination. At that time, Jinke shares said that through restructuring and pre-restructuring, it could effectively avoid the further deterioration of the company's debt risk and operational risk, realize the introduction of strategic investors, optimize the corporate governance structure, and help the company restore profitability as soon as possible. Return to the track of sustainable development, so I intend to apply to the court for reorganization and pre-reorganization.

Yan Yuejin, research director of the Yiju Research Institute, said that restructuring, different from bankruptcy liquidation, is an effective way to resolve risks through marketization and the rule of law, but it should be noted that restructuring is not necessarily successful. If the reorganization fails, Jinke shares will be declared bankrupt.

Beijing Business Daily reporter noticed that Jinke shares took the initiative to propose bankruptcy reorganization, there is an important reason-- war investment.

At the end of June 2023, Jinke shares signed a strategic investment framework agreement with Great Wall Guofu, a wholly owned subsidiary of Great Wall Management, which intends to participate in the pre-restructuring process of Jinke shares as a restructuring investor. According to the agreement, if Jinke shares enter the pre-restructuring or restructuring process, Great Wall Guofeng and / or its designated affiliates intend to participate in the competitive selection as strategic investors during the stage of open recruitment of strategic investors.

In this regard, Jinke shares said that after the company signed the "Strategic Investment Framework Agreement" with Great Wall Guofu Real Estate Co., Ltd., the two sides have set up a working group in accordance with the agreement to establish a coordination and contact mechanism, and carry out all the adjustment and preparatory work in accordance with the agreement. At present, related matters are in normal progress.

There is also a market view that Jinke shares choose restructuring rather than debt rollover, perhaps because the company's financial situation is not optimistic and needs a more thorough solution. Restructuring is usually the last resort when enterprises are unable to solve the financial crisis in other ways. Compared with the debt rollover, restructuring may have a greater and more far-reaching impact on the structure and operation of the enterprise, including the possible surrender of certain management rights, major changes in shareholders, asset sales, business adjustments, major changes in management, and so on.

Because Jinke shares were accepted and reorganized by the court, its shares were suspended for one day on April 23, 2024, and the delisting risk warning was implemented since trading resumed on April 24, 2024. The short name of the stock has been changed from "Jinke shares" to "* ST Jinke", and the securities code is still "000656". After the implementation of the delisting risk warning, the daily rise or fall of stock trading is limited to 5%.

A loss of nearly 30 billion yuan in two years

Once the glory of hundreds of billions of real estate enterprises, is experiencing the "darkest moment."

Not long ago, Jinke issued a performance forecast for 2023. It is estimated that the net loss attributed to shareholders of listed companies in 2023 will be 4.8 billion-7.8 billion yuan, a net loss of 21.392 billion yuan compared with the same period last year, which has narrowed to a certain extent, but has not yet turned losses into profits. Over the past two years, Jinke shares lost nearly 30 billion yuan.

In addition to huge losses, Jinke shares are also facing debt pressure, the debt problem has become a life and death disaster for out-of-danger housing enterprises. Jinke shares' quarterly report in 2023 showed that its liabilities totaled 227.1 billion yuan, of which 35.06 billion yuan were non-current liabilities due within one year.

In addition, according to the cumulative litigation and arbitration announcement disclosed by Jinke shares on April 19, in addition to the disclosed litigation and arbitration cases, Jinke shares and the company's holding subsidiaries received a total of 2.223 billion yuan in new litigation and arbitration cases, accounting for 17.86% of the company's latest audited net assets. Among them, the company as a plaintiff in the case involving 13 million yuan; the company as the defendant or the third party involved in the case involving 2.21 billion yuan. Among the new cases received by the company and its holding subsidiaries, the total amount of cases entering the execution stage is 7 million yuan, accounting for 0.06% of the company's latest audited net assets.

An analyst at a large brokerage research institute told Beijing Business Daily that the fundamental repair of listed companies after restructuring is a complex and long process, which will take at least two or three years. Even after restructuring, some companies may still face the risk of delisting. This is mainly because restructuring may not completely solve all the company's problems, or the restructured company may not be able to adapt to market changes and competitive pressures. For Jinke shares, the introduction of strategic investors through restructuring can bring some financial support to help it alleviate short-term financial pressure, but whether it can really resolve its operating and debt problems remains to be seen.

Wang Yinhao, a reporter from Beijing Business Daily.