Great Wall Motor to issue ultra-short-term financing bonds of RMB5 bln to optimize debt structure

Shanghai (Gasgoo)- Great Wall Motor announced on November 13 that it plans to issue no more than RMB5 billion worth of ultra-short-term financing bonds to optimize its debt structure and the funds raised will be used to supplement working capital and repaid interest-bearing debts.

The "ultra-short-term financing bonds" as mentioned here shall refer to the short-term financing bonds with a term of 270 days or less, which are issued by non-financial enterprises with a legal person status and a high credit rating in the inter-bank bond market. With more flexibility over the short-term financing bonds, the ultra-short-term financing bonds can help enterprises break the bottleneck of short-term working capital scarcity and improve the liquidity management level. 

Affected by the stagnant automobile market climate and investment on new businesses, automakers have increasingly depended on cash flow. Such car makers as JAC Motors and Zotye Auto previously announced that they would use the idle funds raised to supplement routine working capital in order to alleviate the pressure of inventory and payment collection.

Great Wall Motor suffered a year-on-year (YoY) drop of 3.29% in sales with 786,756 vehicles delivered from January to October in total. In addition, the automaker's revenue in the third quarter fell 19% from a year ago to RMB 17.966 billion. Its Q3 net profit attributable to the shareholders of the listed company was nearly halved to RMB 231 million compared with the same period last year.

For the first three quarters, Great Wall Motor gained revenue of RMB 66.65 billion with a YoY increase of 5% while the net profit attributable to the shareholders of the listed company jumped 36.36% to RMB 3.927 billion. The cash flow for the first nine months reached RMB16.46 billion. The automaker said its profitability has been improving thanks to the expanding sales share of WEY branded vehicles.