文 | AI Business Club 刘潇然
Edited by: Yang Shufang
Konka recently began to dispose of its assets frequently.
On September 27, Konka Group issued the "Announcement on the completion of industrial and commercial change registration of the transfer of some shares of Kunkang Corporation." Kun Kang Company is a wholly-owned subsidiary of Konka. Konka sold 51% of Kun Kang Company.
Just a few days ago, several other assets owned by Konka have also been sold.
On August 24, Konka announced that it intends to transfer 70% of the shares it held in Kangqiao Jiacheng Company. At the same time, it plans to transfer the three houses of No. 5, Lane 25, Huihe Road, Hongkou District, Shanghai to the property rights exchange. . In May of this year, Konka also announced that it had sold 22.935% of its shares in Bioray Optoelectronics (Shanghai) Co., Ltd. Taking all of the above assets together, the realized scale has reached nearly 4.5 billion yuan.
This does not make one wonder whether this veteran home appliance company, which has been poorly run in recent years, has entered the tragic situation of "broken capital chain." In fact, everything is closely related to the transformation of Konka's main business.
Brilliant, turbulent and declining
Konka’s predecessor was “Guangdong Overseas Chinese Electronic Industry Co., Ltd.†approved by the state in 1979. It is a Sino-Hong Kong joint venture with a first phase investment of HK$43 million, a Chinese party holding 51%, and a Hong Kong shareholding of 49%. In November 1980, the board formally determined that the product trademark was KONKA Konka.
Taking advantage of the reform and opening up, Konka successively established five color TV production bases in the northeast, northwest, south China, east China, and southwest, and has more than 20 color TV production lines. The annual color TV production capacity exceeds 10 million units, forming a strong manufacturing industry. ability.
Afterwards, Konka Group experienced Chen Weirong's helm, restructuring, listing and expansion. The company's total assets have been rising all the way. Since 2003, Konka has been the real name of the “Color TV First Brand†and has won the top spot for color TV sales for five consecutive years. By 2007, the overall retail volume of Konka Color TV was 14.09%.
At that time, the Konka TV at home was the memory of countless Chinese people. But in the next decade, the color TV giant ushered in an ominous fate.
There is a contradiction between the way the OCT Group’s major shareholder OCT City and its small and medium shareholders have come and the right to seize power. This buried volcano erupted in 2015.
The small and medium shareholders have overturned the board of directors controlled by the major shareholder of the central state-owned enterprise through shareholders' meetings, and formed a new management level. This is the first case in which the first small and medium shareholder in the history of China’s securities has successfully “forced the palaceâ€. However, just twenty days later, the situation was reversed and the former president of the majority shareholder, Liu Fengxi, was re-elected as chairman of the board of directors.
The battle to seize power must be sacrificed. Konka’s middle and senior levels were “washed out†in that year, and 42 directors, supervisors, and senior management personnel changed. A brief and violent shock deepened the entire Konka Group and its performance plummeted. According to the 2015 annual report, the net loss attributable to shareholders of listed companies was as high as 1.257 billion yuan, down 2488.32% year-on-year.
At the same time as the vitality, Konka is still undergoing drastic changes in the home appliance industry.
The rise of the mobile Internet began to occupy the audience's attention, and the market demand for color TVs continued to decline. Public data shows that in 2017, domestic TV sales totaled 21.81 million units, down 7.3% year-on-year.
At the same time, the new style of play of Internet companies such as LeTV and Xiaomi has also exerted an impact on the television industry. The industry pattern inevitably goes to the Internet. Although Konka is also actively seeking transformation, it has taken steps to launch Internet sub-brand KKTV, develop OLED TV products, and introduce content resources of Internet TV brands. However, Konka cannot compete with LeTV's puerile, marketing, and mass content library. force.
On the other hand, Konka's investment in research and development has accounted for no more than 1.3% of its revenue for four consecutive years, lagging behind traditional color TV counterparts such as Hisense. Konka was a high-tech manufacturing company 20 years ago, but now it cannot find new core technology growth points.
According to statistics, in the first half of 2016, Konka took a share of 1.9 million units in China’s LCD TV market with 2.3 million units, ranking behind Skyworth, Hisense, TCL, Changhong, and Haier. Two echelons.
Light asset transformation
According to Konka's first half earnings report during the first half of the year, Konka’s operating income was 11.4 billion yuan during the reporting period, a year-on-year increase of 32%; net profit was 30.87 million yuan, a year-on-year increase of 141%. However, the main business was sluggish and the cash flow was tight. After deducting non-recurring gains and losses, the net profit attributable to the shareholders of the listed company was nearly 44.456 million yuan, a year-on-year decrease of 54.7%; the net cash flow from operating activities was 2.264 billion yuan. Compared with the same period of last year, it fell 1703.39%; current liabilities were 17.317 billion yuan, 3.4 billion more than at the beginning of the period. The main color TV service business revenue in the first half of this year was 5.29 billion yuan, a decrease of 1.45% from the same period of last year, and the gross profit rate was 0.53% lower than the same period of last year.
In the financial report, Konka also stated that due to the increasingly fierce competition in the color TV industry, the continued low price competition of Internet brand TV and the continuous increase in investment by foreign brands, while the price of upstream raw materials represented by the panel has increased, resulting in a decline in the gross profit margin of color TV and other main businesses. .
The money-losing TV business forced Konka to find another stove and no longer cling to a single industry.
Chairman of the Board of Directors of Konka Group Liu Fengxi once stated this year: "Konka is no longer just a color TV company. It will transform its investment holding platform and expand its investment business. The color TV business will seek an independent listing." Konka's announcement also stated that it hopes to spin off home appliance manufacturing, etc. Heavy asset business, take off the label of "traditional manufacturing", and look for new business growth points through investment, incubation and other methods.
In the financial report, it can be seen that there are many projects in Konka that urgently require financial injection.
The major non-equity investment currently underway at Konka indicates that, as of the end of the reporting period, the actual amount of investment in the old factory reconstruction project in Konka has been 1.016 billion yuan, and the progress of the project is only 14.73%; the Zhouzhuang project in Kunshan Shuiyue has accumulated. Invested 1.686 billion yuan, the project progress rate was 57%; Kechuang Center project has invested a total of about 76.66 million yuan, a progress of 17%; Dongguan construction of a new factory project has not yet begun.
At the same time Konka is also actively buying. Since the beginning of this year, Konka has acquired a 24% stake in Guangdong Chutianlong Smart Card Co., Ltd. for 588 million yuan and invested 172 million yuan in a 20% stake in Shenzhen Yaode Technology Co., Ltd., an upstream company in the industrial chain, and plans to invest no more than 1 billion yuan. Yuan and China Oriental Asset Management Co., Ltd. set up an industrial fund that is expected to reach 5 billion yuan. The capital operation covers TMT industry, smart manufacturing, new energy, new materials, and great health.
To sum up, it is not difficult for Konka to sell away real estate and assets. Companies need positive cash flow to make capital preparations for transformation. After the main business was hit hard, Konka tried to take a new path of light assets.
Broken arm rebirth
Konka's investment direction covers almost all emerging industries such as smart manufacturing, new energy, and health.
This is unique in the Chinese home appliance industry. It should be noted that the transformation of Gree, Midea, Haier and other enterprises whose body volume is several times that of Konka is also limited to smart manufacturing related to the real economy. Once the implementation of "light assetization" is completed, Konka Group will become an investment holding platform that is far from the original business model of home appliance business.
This transformation is also a shift from a pattern that relies mainly on a single color TV product line to a multi-industry parallel, from a product operation to a comprehensive one.
Zhou Bin, the president of Konka Group, publicly stated that “a listed company is a capital platform and seeks for capital appreciation. The means for adding value is not necessarily achieved through a single product or industry.â€
He believes that Konka can fully use the years of industrial advantages in Shenzhen TV Group, through mergers and acquisitions, independent research and development, configuration of incubators and other modes, to accelerate the expansion of foreign countries, build smart ecology, and form an ecosystem of the Internet of Things to achieve a new profit model.
Liu Fengxi repeatedly stressed that only Konka's color TV business is operating more independently, and that Konka Group can jump out of specific industries and have more energy to make macroeconomic decisions to strengthen capital operations. According to media reports, during the year, Konka hopes to complete the restructuring of the big color TV business and strive for implementation at the end of this year and early next year. Once the reform of the color TV business is completed, all Konka's businesses will complete the mechanism reform.
According to Konka's plan, several major businesses, including color TV, white electricity, and mobile phones, will be operated through the company's industrialization, and the group will become an investment holding company, thus expanding its investment business. It is understood that Konka Group has already established six or seven investment teams to use market-oriented means to operate the investment business.
Perhaps, in the future, Konka will no longer be an appliance brand recognized by consumers. It is undergoing a radical change and trying to regenerate.
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