shandong ruyi technology group co ltd - debtwire ruyi technology... · 2019-07-23 · page 2...

Shandong Ruyi Technology Group Co Ltd Manufacturing

1Q19 Credit report 19 June 2019 China

Credit report DW-APAC 19-June-19

OVERVIEW

Shandong Ruyi Technology Group, a Shandong-based textile manufacturer and global fashion brands owner, showed in its latest results that 1Q19 revenue and EBITDA improved largely as the result of its 51.8%-owned French luxury fashion brand manager and retailer SMCP. However, a series of debt-funded acquisition - including SMCP in 2016 - combined with the poor performance from its legacy textile business has left Ruyi with high leverage and weak liquidity ahead of the December maturity of USD 345m bonds.

In total, Ruyi reported CNY 12.3bn debt due within one year of 31 March 2018 - including the USD bonds and CNY 2.7bn domestic notes maturing or puttable by November - against just CNY 8.36bn cash, including restricted. Its net leverage, while

ISSUER SUMMARY

Country China

Sector Manufacturing (other)

Credit rating B/B2/NA

Total assets (31-Mar-19) CNY 67.9bn

Total debt (31-Mar-19) CNY 27.7bn

MAJOR EVENTS

Next earnings release: Aug-19

Next significant maturity: Dec-19

Source: Debtwire, company financials

ASIA CREDIT RESEARCH

Michelle Lee, Research Analyst +852 2158 9689 [email protected]

Ryan Patwell, Head of Research, Debtwire Asia +852 2158 9777 [email protected]

improving a tad, was still 7.7x as of end March. That is up from 3.8x in 2012, the year before the company began raising significant amounts of debt to fund diverse overseas acquisitions, including cotton farms in Australia, fashion brands in France and Japan and a power plant in Pakistan.

Prompted by frustration over Ruyi’s apparent lack of a refinancing plan, holders of the USD 345m, 7.5% due-2019s floated the idea of an exchange offer early this year, according to a 15 March Debtwire article. Instead, the company eventually touted other refinancing options, including spinning off self-used commercial and industrial properties into a Singapore REIT, an ambitious deal considering that the underlying assets are in third-tier Chinese cities, as per a 9 May Debtwire article. (For more details on Ruyi’s potential refinancing plans, see page 3).

Weighing on the private company’s credit profile is its corporate governance stumbles. As Debtwire reported in mid-2017, the state backed shareholder Ruyi disclosed in its bond offering circulars had actually transferred the stake to another state entity, a foible management later blamed on the shareholder’s lack of disclosures. (For more details on Ruyi’s corporate governance issues, see page 4.)

SHANDONG RUYI TECHNOLOGY GROUP CAPITAL STRUCTURE (CNYm)

Instrument Issuers Issuance

date Coupon Maturity

Amount outstanding as at 31-Dec-18

Amount outstanding as at 31-Mar-19

Pro forma amount (CNYm)

Pro forma amount (USDm)

Pro forma leverage

Short-term secured loans <1 year 1,860 NA(1) NA(1) NA(1)

Long-term secured loans >1 year 2,505 NA(1) NA(1) NA(1)

Finance lease >1 year 1,400 1,400 1,400 203

Offshore secured bonds(2) 18-May-16 2022-23 2,167 2,167 773 112

Total secured debt 7,932 3,566 2,173 314 0.9x

Other short-term loans 5,960 7,202 7,202 1,042

Other long-term loans(2) 2,658 4,612 7,356 1,065

Onshore bonds 2015-19 5.5-7.9% 2019-23 5,703 6,203 6,203 898

Offshore bonds 2016-18 6.95-7.5% 2019-22 6,419 6,419 6,419 929

Total debt 28,672 28,002 29,353 4,248 11.6x

Cash and cash equivalent(3) 8,953 8,359 9,710 1,405

External guarantee 2,011 2,011 2,011

Credit facilities (mostly uncommitted)(4) 3,139 3,139 3,139

Net debt 19,719 19,643 19,643 2,843 7.8x

LTM adj. EBITDA(4) 2,531

Source: Debtwire, company filings 1) No breakdown of loan types for 1Q19; 2) 51.8%-owned subsidiary, SMCP, announced early redemption of EUR notes due-2023 on 10 May, which are to be refinanced by new EUR 265m amortizing term loan and a EUR 200m revolving credit facilities, with five-year maturity. SMCP also repaid EUR 110m of credit facilities previously drawn with new loans; 3) pro forma cash is cash as of 1Q19 after adjusting for bond redeemed and new debt issued between April and date of this report date; 4) no disclosure on whether credit facilities are committed or not. However, most of credit facilities are provided by onshore banks, which are uncommitted.

FINANCIAL SUMMARY (USDm)

Period-end 31-Dec 31-Dec 31-Dec 31-Dec 31-Mar 31-Mar 31-Mar YoY % ∆

2015 2016 2017 2018 TTM to Mar 1Q18 1Q19

Revenue 22,770 29,087 35,738 34,282 37,306 8,807 11,831 34.3%

Adj. EBITDA 1,702 2,487 3,782 2,375 2,531 737 894 21.2%

EBITDA margin 7.5% 8.6% 10.6% 6.9% 6.8% 8.4% 7.6%

Operating cash flow 959 2,498 3,256 1,895 1,871 144 120 -16.6%

Capex (1,369) (2,194) (2,104) (2,963) (2,936) (82) (55) -33.1%

Free cash flow (410) 303 1,152 (1,069) (1,066) 62 65 5.3%

Cash and cash equivalents 8,396 8,583 9,811 8,953 8,359 9,758 8,359 -14.3%

Total debt 15,372 24,011 25,516 28,008 27,747 24,717 27,747 12.3%

Total debt/adj. EBITDA 9.0x 9.7x 6.7x 11.8x 11.0x - -

Net debt/adj. EBITDA 4.1x 6.2x 4.2x 8.0x 7.7x - -

Interest expense, gross (630) (1,216) (1,340) (1,508) (1,603) (278) (374) 34.4%

Adj EBITDA/interest expense 2.7x 2.0x 2.8x 1.6x 1.6x 2.7x 2.4x

Source: Debtwire, company financials

mailto:[email protected]


https://www.debtwire.com/intelligence/view/prime-2802604











Cash flow: Free cash flow looks likely to improve in 2019 on the back of lowered capex, but should still be negative for the year, meaning the company is unlikely to have excess internal cash to help repay debt, leaving a lot of liability management left to do.

Using the TTM end-March operating cash flow of 1.9bn, and assuming Ruyi continues to rein in capex to 2016-2017 average levels of CNY 2.1bn, 2019 free cash flow should improve but still come in around negative CNY 300m. 2018 FCF was negative CNY 1.07bn, when capex was CNY 2.96bn.

BUSINESS DESCRIPTION

Reduced capex seems likely because the main reason for the 2018 increase was not higher maintenance capex but rather the CNY 1.2bn purchase of an office building in Jining, Shandong from Industrial & Commercial Bank ICBC.

In 1Q19, free cash flow improved slightly YoY, to CNY 65m (CNY 62m in 1Q18), because capex was only CNY 55m (1Q18: CNY 85m), offsetting a 16.6% decline in OCF, to CNY 120m. OCF fell despite a 21.2% increase in EBITDA, to CNY 894m. That was partly the result of a 17.4% YoY rise in cash interest paid, to CNY 370m. The undisclosed remainder may have been

trapped in working capital. S&P noted in a 15 May press release that Ruyi would likely have growing working capital needs in 2019 in order to fund its planned expansion of self-owned stores as well to penetrate online channels.

1Q is not a good barometer for Ruyi's performance, given that in the past two years, OCF and capex for the quarter made up a fraction of the full year figures.

Business performance: Revenue grew by 34.3% YoY in 1Q to CNY 11.83bn, helping EBITDA increase by 21.2% YoY, to CNY 894m. The 82bps EBITDA margin

Shandong Ruyi Technology Group transformed from a state-owned enterprise to a privately held company in 2001. Shandong-based Ruyi operates a full textile and apparel products value chain. Its upstream capacity includes raw materials sourc-ing, wool and cotton production, and ownership of sheep farms and cotton fields in Australia. Midstream includes wool- and cotton-based fab-rics manufacturing, apparel design and produc-tion. Downstream includes apparel retailers, in addition to selling through distributors. Ruyi also engages in textile raw materials trading. Main segments include apparel, yarn and fabrics, tex-tile raw material trading, as detailed below:

Apparel segment: Made up 78.7% of the group’s CNY 8.94bn total gross profit in 2018, with a rela-tively juicy gross profit margin of 57.3%. The seg-ment includes Ruyi’s self-produced high-end suits and brands held through acquired stakes in brand operators, which contributed more than 90% of the segment’s revenues, according to the April 2019 onshore bond OC. Ruyi owns about 40 brands. Its major consolidated brand operators include:

● SMCP (SMCP EPA): Ruyi acquired control of the French subsidiary in 2016 and owned a 51.8% stake as of end-2018. Its gross profit equivalent to 56.4% of Ruyi’s total gross profit. SMCP operates wholesale and retail sales of accessible luxury brands Sandro, Maje and Claudie Pierlot. Sandro designs and sells wom-en clothes, bags and shoes and active and smart casual attire for men. Maje designs and sells women urban fashion including bags and

accessories. Claudie Pierlot focuses in tradi-tional style women and girls' clothes, bags, shoes and accessories.

● Renown (3606 TYO): Ruyi acquired control in 2010 and owned 53% of the Japanese apparel manufactures and purveyor as of end-2018. Renown’s gross profit was JPY 29bn (CNY 1.85bn) during FY19 ended- February, which equates to 20.7% of Ruyi’s 2018 gross profit. Renown operates 29 brands including Durban, Aquascutum and Simple Life. D'urban focuses in men's business and leisure wear. Aquascu-tum is a British classic brand known for women waterproof trench coats, also designs and sells men and women’s luxury clothes and accesso-ries. Simple Life offers men and women's natu-ral and simple modern casual clothes.

Yarn & fabrics segment: Made up 8.7% of the group’s CNY 8.94bn total gross profits in 2018, with a GPM of 10.6%. Cotton yard and wool, which contributed 46.6% and 37.5% of the seg-ment’s 1Q18(1) revenue respectively in 2018 were the main products. Other products include Denim (7.2% of the segment’s revenue) and spandex (2.8% of segment’s revenue). 45.9% of yarn and fabric production are sold overseas as of 1Q18(1).

Textile raw material trading segment: Made up 3.8% of the group’s total gross profits in 2018, with a GPM of 2.8%. Main trading products in-clude cotton (49.2% of segment’s revenue in 1Q18(1)) and cotton yarn (44.1% of segment’s revenue in 1Q18(1)). Other trading products in-clude wool top and dyed fabrics.

“Other” segment: Made up 8.7% of the group’s gross profits. This segment includes cotton plant and electricity and steam generation. Ruyi owns a 93,483 hectares cotton farm in Australia (Cubbie Station), which mainly sells locally. Ruyi also owns a 50% stake in a power plant in Paki-stan with 660MWx2 capacity in a joint venture with China Huaneng Group. According to Debtwire 9 May report, the plant generated CNY 700m profits last year.

Shareholding: Beijing Ruyi Fashion Investment Holding is Ruyi’s largest controlling shareholder with a 53.49% stake. This gives the group’s ulti-mate controller and chairman Qiu Yafu a look-through stake of 27.3%. (See 28 May 2018 Share-holder Profile on Qiu Yafu for detailed back-ground). As of 12 March, Beijing Ruyi’s 51.4% had been pledged to back borrowings from Chi-na Cinda Asset Management, Shandong Interna-tional Trust Investment and Bank of China, ac-cording to the 12 March 2019 onshore bond OC.

Yinchuan Financial Holding, which is majority owned by Yinchuan State-owned Assets Super-vision and Administration Commission (SASAC), holds a 26% stake in Ruyi.

Japanese trading corporation Itochu Group is the third largest shareholder, with 11.72% stake. The remaining 6.6% is held by Mild International. (1) The latest data available

GROSS PROFIT MARGIN BY SEGMENT IN 2018

Source: Debtwire, company filings

REVENUE AND GROSS PROFIT BREAKDOWN IN 2018






https://www.debtwire.com/document-repository/document/rkUy1qkKPE





contraction, to 7.6%, continued the 20018 trend, when revenue fell 4.1%, to CNY 34.28bn, but EBITDA fell 37.2%, to CNY 2.38bn.

Ruyi doesn’t break out segmented EBITDA, but based on the limited disclosures it and some of its subsidiaries do make, the 2018 EBITDA decline appears to be largely driven by a significant decline in the non-apparel segment.

The legacy yarn and fabrics segment’s revenue declined by 31.4% in 2018, to CNY 7.44bn, leading to a CNY 431m decline in gross profit, to CNY 785m, according to the financial statement. Management noted in the annual report that the fall in revenue was the result of the deconsolidation of subsidiaries Ruyi sold to its parent company, which a June 2018 Dagong Global Credit Rating report stated was for CNY 1.925bn in late 2017 (see related parties transactions section on page 4).

The company's "other" non-apparel segment, which includes a cotton farm in Australia and a 50% stake in a Pakistan power plant, experienced a 27.7% decline in gross profit for the year, to CNY 777m. Ruyi doesn't explain in the 2018 annual report the reason for the decline.

Ruyi's remaining operations consists of its apparel businesses, which accounted for 78.7% of gross profit in 2018. Apparel is almost entirely made up of 51.8%-owned SMCP and 53%-owned Japanese apparel producer and brands operator Renown. SMCP’s reported gross profit is equivalent to 56.4% of Ryui’s consolidated gross profit in 2018(4). Its EBITDA for the year rose 4.2% YoY.

Renown on the other hand experienced an EBITDA loss in FY19 through February of CNY 109m compared to positive EBITDA of CNY 56m in the year prior. While the different fiscal year end makes it hard to precisely quantify Renown's impact, its standalone figures for FY19 suggest that its contribution to the overall decline in Ruyi's EBITDA in 2018 was relatively minor.

Ruyi’s refinancing options: Management, beginning in late April and during meetings with credit investors in early May, outlined the following refinancing options for the USD bonds, as Debtwire reported:

● Listing via a Singapore REIT commercial and industrial properties provisionally valued at CNY 8bn: Ruyi hired PricewaterhouseCoopers to appraise the properties but has been proceeding under management’s

assumption that the properties are worth CNY 8bn (USD 1.19bn), as per a 9 May Debtwire article. The valuation is key because management plans to sell a minority stake in the REIT to raise CNY 3bn for the redemption of the due-December notes. The Debtwire article highlighted doubts as to whether investors would buy into a REIT whose underlying assets are located in third-tier Chinese cities. S-REITS require the underlying assets to yield in excess of five-year Singapore sovereign bonds (currently yielding 1.99%), King & Wood Mallesons stated in a 13 September 2018 report in Lexology, an online publication for legal updates, analysis and insights. In April, Ruyi mandated DBS Bank to run a USD 450m IPO in Singapore of the property assets, as Debtwire reported at the time.

● Selling its 50% stake in a 660x2 MW thermal-power plant in Pakistan: Joint-venture partner China Huaneng Group had been interested in buying out Ruyi’s stake, but Ruyi’s USD 3.5bn valuation for plant was too high, considering the industry P/E is usually 10x and the plant generates CNY 500m-CNY 700m (USD 72.4m-101.3m) profit annually, according to the 30 April Debtwire article. At that multiple, the plant would only be worth between USD 724m and USD 1.01bn. Ruyi bought the 50% stake for only USD 180m in 2015.

● USD 500m offshore bond issuance quota expiring by end-March 2020: Ruyi is reluctant to refinance through an offshore bond issuance, given where it outstanding notes are yielding, as per the 30 April Debtwire report. The December 2019s were yielding 15.55% as of 18 June and due-July 2022s were at 15.19%, according to Markit.

● Drawing on credit facilities: Management considered drawing on domestic uncommitted credit lines from Citic Bank and Minsheng Bank, which have at least CNY 4.5bn remaining unused as per the 30 April Debtwire report.

Leverage & debt profile: Aided by improved YoY EBITDA in 1Q19, net debt to EBITDA for TTM ended March improved a tad, to 7.7x, from 8x as of end December. But leverage remains significantly higher than the 4.1x in 2015, the year before a Ruyi vehicle’s EUR 1.3bn purchase of SMCP. Because of its debt-fueled expansion (see page 5 for a list of acquisitions), Ruyi’s debt has soared in recent years at a much faster pace than EBITDA. Its CNY 27.75bn total debt as of TTM to end-March 2019 was 80.5% higher than as of end 2015. EBITDA rose by just 48.7% during that period.

To back the purchases, Ruyi has had to tap the expressive private debt market, as Debtwire exclusively reported. A Ruyi-led consortium’s equity contribution for its USD 2.37bn Lycra Company acquisition closed in January was part-funded by a Credit Suisse-arranged USD 400m, low-teens-coupon-plus-equity-kicker three-year mezz facility. In addition, members of the consortium raised USD 150m, nearly 20% junior mezz from a Chinese institution’s offshore arm.

Debtwire estimates that Ruyi has CNY 29.35bn pro forma debt as of 18 June, after accounting for a new EUR 465m due-2024 credit facility at SMCP closed on 9 May. The new facility was used in part to refinance a EUR 110m due-2022 credit facility and also to redeem early the French retailer’s EUR 180m due-2023 notes.

The company’s debt mostly sits at the following entities:

ASSET VS DEBT GROWTH BETWEEN 2016-18


http://www.dagongcredit.com/uploadfile/2018/0712/20180712051841798.pdf




https://www.lexology.com/library/detail.aspx?g=392d322d-84f0-4d81-9609-61999e173496

https://www.lexology.com/library/detail.aspx?g=392d322d-84f0-4d81-9609-61999e173496

http://www.debtwire.com/intelligence/view/prime-2827980














● Ruyi: CNY 12.64bn, or 45.5% of total group debt as of end-1Q19, including CNY 6.2bn onshore bonds (44.5% of total debt in 2018). The unlisted entity held 55.2% of the group’s total asset and 39.9% (CNY 3.34bn) of the group’s cash as of 1Q19. Debtwire reported on 9 May that unrestricted cash at the parent level was at least CNY 2bn.

● Prime Bloom Holdings: The BVI-incorporated offshore financing vehicle through which Ruyi issued the USD 300m due-July 2022s as well as the USD 345m due– December 2019s. Both of the notes are guaranteed by the onshore parent company.

● SCMP: CNY 2.49bn (EUR 320m) debt as of end-2018, which is 8.9% of total group debt. That includes EUR 100m senior secured floating rate notes due-November 2022 and EUR 180m, 5.88% secured notes due May-2023.

● Ruyi additionally reported CNY 2.01bn external guarantees as of end-December.

Corporate Governance:

Related parties transactions: In October 2017, Ruyi sold three subsidiaries to parent company Beijing Ruyi Fashion Investment Holding Co, according to the April 2019 onshore bond OC. The company didn’t disclose how much it received for the subsidiaries, but Dagong Global Credit Rating stated in a June 2018 rating report that the amount was CNY 1.925bn.

The three subsidiaries were 50.69% owned dyed fabrics manufacturer Jining Ruyi Printing and Dyeing, wholly owned home textile manufacturer Jining Ruyi Home Textile and 79.66% owned cotton yarn manufacturer Chongqing Sanxia Technology Textile. Ruyi stated in the onshore bond OC that these subsidiaries were disposed due to their high manufacturing costs. The company's financial statements don’t demonstrate an improvement in cost efficiency since the sale. Ruyi’s yarn and fabrics segment revenue declined by 31.4% in 2018, and gross profit margins actually declined to 10.6% from 11.2% in 2017 (2016 margins were 10.7%).

The Dagong rating report stated Ruyi disposed the facilities because they were outdated. That hasn’t stopped Ruyi from transacting with them post the disposal. In 2018, these three units purchased CNY 2.27bn goods or services from Ruyi and sold CNY 1.36bn of goods or services back,

resulting in a net purchase from Ruyi of CNY 909m.

In addition, related parties including the three subsidiaries purchased CNY 4.46bn of goods and services from Ruyi last year and sold CNY 1.85bn back, its 2018 annual report shows.

Capital spending: Ruyi’s CNY 2.96bn capital expenditures in 2018 was elevated compared to 2016 and 2017 due in large part to the CNY 1.2bn purchase in 4Q18 of the office building from ICBC.

The group provides only limited disclosure on it capex breakdown but it seem that a disproportionate amount is on its struggling non-apparel businesses.

SMCP and Renown, whose standalone gross profit equated to 77% of Ruyi’s gross profit, reported capex of CNY 414m and CNY 165m for their most recent receptive full financial years(5) equivalent to only about 20% of consolidated capex.

Ruyi, in its April 2019 bond OC, states that it is developing industrial parks and factories to upgrade and expand its production capacity and that this project is expected to be completed in 2019.

The rationale for this investment is questionable given that the bulk of Ruyi’s cash flows now come from its ownership of overseas brands and that its other businesses, including yarn, fabrics and textile raw material trading generate razor thin margins and likely contribute only minimal EBITDA.

Shareholding Disclosures: As Debtwire first reported in July 2017, Ruyi was touting a 26% stake held by Yinchuan Tonglian Capital Investment Operation even though the government-owned investment vehicle disclosed at the time that it disposed of the stake in 2016.

In response to the Debtwire report, the company clarified that it hadn’t previously been made aware of the disposal because the stake had been transferred to another vehicle owned by the Yinchuan government, which also took back from Ruyi stakes in two financial units in early 2017 without notifying the company.

Yinchuan State-owned Assets Supervision & Administration Commission’s (SASAC) Yinchuan Tonglian Capital Investment Operation gained its exposure in Ruyi in 2015 by buying preference shares for CNY 2bn entitling the holder to a 26% equity stake in the company.

Ruyi’s April 2019 onshore bond OC discloses that Tonglian’s stake was transferred in August 2017 to fellow Yinchuan SASAC entity Yinchuan Financial Holding.

1) The latest info available

2) Successful listing as REIT in Singapore requires 75% of the underlying assets to generate stable cash flow and yield more than 5-year Singapore sovereign bonds.

3) Return on assets is calculated as EBIT over average total assets.

4) Debtwire estimate based on comparing the size of SMCP and Renown’s gross profit in standalone financials to Ruyi’s consolidated figures for its apparel division

5) SMCP has financials for 2018 and Renown has financials for FY19-ended February.




http://www.debtwire.com/intelligence/view/2470760








OVERSEAS ACQUISITIONS

Assets Acquisition(/announced )

date

Consideration (USDm)

Stake acquired

Stake owned as of 2018

Description

Renown Inc. (3606 TYO)

2010 45.8 41.26% 52.99%

Renown is a Japanese apparel designer, manufacturer and seller. It owns 29 brands including D’URBAN, Aquascutum and Simple Life, with 2,491 stores as of end-1Q18 2013 NA 11.73%

Cubbie cotton farm, Australia

2013 249 80% NA(1) 93,483 hectares cotton farm with 65 thousands tons annual production. Ruyi currently has an 80% stake but will need to sell off at least an 29% stake — bringing Ruyi’s holding down to 51% — by October 2019, as required by Australia’s Foreign Investment Review Board.

Lempriere (Australia) Co., Ltd.

Jun-16 44 51% 51%

Lempriere, founded in 1857, supply’s wool and wool top to textile mills and fashion companies globally. The company has trading offices in Australia, South Africa, Argentina, United States, and New Zealand. Lempriere owns wool processing assets in New Zealand and Europe, and has offices in China.

2x660MW Power plant in Pakistan

2015 180 50.00% 50.00% Total project investment was USD 1.8bn, including USD 360m of capital contributed by Ruyi and China Huaneng Group, and USD 1.44bn loans under the JV. The plant generated USD 104m profits in 2018, as per 9 May 19 Debtwire report

SMCP Oct-16 NA 42.41% 53.9%

Ruyi partnered with LGFV Yinchuan Weixin Fund to purchase a 81.9% stake in SMCP for EUR 1.3bn. The deal was done through a JV, Jining Ruyi Garment Development, which Ruyi owned a 51.8% stake in while the rest was held by the LGFV. That gave Ruyi a 42.4% look through stake in SMCP at the time of the acquisition.

While it is not clear how much exactly Ruyi put up for the deal, Ruyi’s total debt shot up by 56.2% in end-2016 from the previous year.

SMCP had an IPO on 20 Oct 17, and shareholders received a total of EUR 496m from the IPO, of which Ruyi received EUR 261m. The IPO dropped Ruyi’s stake in the company to 31.75%. But Ruyi on 15 August 2018 bought out its JV partner, bringing its stake back up to 53.9%.

Trinity Ltd (891 HK) Nov-17 284 51.98% 51.90% Trinity operates in retail and wholesale of premium menswear in China, Singapore and Europe with a total of 253 stores and owns brands including Cerruti 1881, Gieves & Hawkes and Kent & Curwen.

Invista's apparel & advanced textiles business (Lycra)

Jan-19 175 >10%

minority stake

>10% minority stake

A consortium including Ruyi bought the USD-based spandex brand Lycra for USD 2.5bn, according to S&P’s 15 May press release. Though Ruyi's stake in Lycra or the consortium is not disclosed, a 2 April Debtwire report noted that the acquisition funding comprised USD 175m from Ruyi entities, USD 170m from Itochu Group, USD 500m from Koch Industries and the remaining funds after debt raised from Ruyi's local government, which is expected to be about USD 550m, as per Debtwire 2 April report. The debt raised includes a USD 400m 3-year mezzanine facility from Credit Suisse, USD 150m from Chinese bank's offshore arm, USD 690m notes due-2025 and EUR 250m notes due-2023. According to this capital contribution breakdown, Ruyi holds about 12.5% stake in Lycra.

Bagir Group Ltd (Nov-17) 16.5 53.70% Pending

The deal was extended to 30 May 19 as Ruyi failed to make the remaining USD 13.2m payment by end-2018, the previous agreed completion date, citing pending approval from the Chinese government. Bagir (BAGR LON) is a Israel based designer and manufacturer of tailored fashion that primarily operates in Europe and the United States.

Bally International A.G.

(Feb-18) 700 NA

(controlling stake)

Pending Shandong Ruyi Investment Holding, JAB Holding and Bally's management team signed definitive agreement for the acquisition of a controlling stake (unspecified) in Bally by Ruyi for about USD 700m. No further news on whether the transaction was completed as of this reports date.

Source: Debtwire, 12 Apr 19 onshore bond OC

https://www.abc.net.au/news/rural/rural-news/2016-06-21/cubbie-ownership-changes/7517058

http://www.szse.cn/disclosure/listed/bulletinDetail/index.html?42ff2f31-b19a-4bb7-a2b8-5bbf2def6596







CAPITAL STRUCTURE (CNYm)

Instrument Issuers Issuance

Date Coupon Maturity

Amount Out-

standing as at 31-DEC-18

Amount Out-

standing as at 31-MAR-19

Pro Forma

amount

Pro Forma

amount (USD m)

Price Yield

Est Annual Interest on Pro forma

amounts

Pro Forma Lever-

age

Guarantor

Short-term secured loans < 1 year 1,860 NA (1) NA (1) NA (1)

Long-term secured loans > 1 year 2,505 NA (1) NA (1) NA (1)

Finance lease > 1 year 1,400 1,400 1,400 203

Offshore secured bonds

EUR 100m senior secured floating rate notes BiSoho/ SMCP

18-May-16 3m EURI-

BOR + 600bps

1-Nov-22 773 773 773 112 MidSoho S.A.S

(parent)

EUR 371m 7-year callableenior secured notes(2) BiSoho/ SMCP 18-May-16 5.88% 1-May-23 1,394 1,394 0 0 82

MidSoho S.A.S (parent)

Total secured debt 7,932 3,566 2,173 314 0.9x

Short-term guaranteed loans < 1 year 4,110 NA (1) NA (1) NA (1)

Long-term guaranteed loans > 1 year 313 NA (1) NA (1) NA (1)

Short-term credit loans < 1 year 318 NA (1) NA (1) NA (1)

Long-term credit loans > 1 year 1,698 NA (1) NA (1) NA (1)

Other loans(2) < 1 year 1,533 7,202 7,202 1,042

> 1 year 647 4,612 7,356 1,065

Onshore bonds

CNY 2bn 5-year puttable corporate bond(3) Shandong Ruyi 23-Oct-15 7.90% 23-Oct-20 1,903 1,903 1,903 275 150

CNY 300m 5-year corporate bond(4) Shandong Ruyi 14-Nov-17 7.60% 14-Nov-22 300 300 300 43 23

CNY 1.5bn 5-year corporate bond(4) Shandong Ruyi 18-Sep-18 7.90% 18-Sep-23 1,500 1,500 1,500 217 119

CNY 500m 3-year medium-term notes I Shandong Ruyi 28-Mar-16 5.99% 28-Mar-19 500 0 0 0 0

CNY 500m 3-year medium-term notes II Shandong Ruyi 31-Aug-16 5.50% 31-Aug-19 500 500 500 72 28

CNY 1bn 3-year medium-term notes I Shandong Ruyi 14-Dec-17 7.50% 14-Dec-20 1,000 1,000 1,000 145 75

CNY 1bn 3-year medium-term notes I Shandong Ruyi 15-Mar-19 7.50% 15-Mar-22 0 1,000 1,000 145 75

Subtotal 5,703 6,203 6,203 898

Offshore bonds

USD 345m 3-year callable senior notes Prime Bloom

Holdings

19-Dec-16

7.50% 19-Dec-19

1,728 1,728 1,728 250

96.28 15.55% 179

Shandong Ruyi Technology

Group, Forever Winner Intl

Development 11-Jan-17 656 656 656 95

USD 300m 5-year callable senior notes Prime Bloom

Holdings

5-Jul-17

6.95% 5-Jul-22

1,382 1,382 1,382 200

80.50 15.19% 144

Shandong Ruyi Technology

Group, Forever Winner Intl

Development 10-Nov-17 691 691 691 100

"2019 Luxembourg bond"(5) NA 2018 NA NA 1,962 1,962 1,962 284

Subtotal 6,419 6,419 6,419 929

Total debt 28,672 28,002 29,353 4,248 11.6x

Out of balance sheet debt

USD 690m 7-year callable senior first-lien secured notes (6)

Eagle Intermediate

Global Holding B.V

(Netherlands), Ruyi

US Finance/ LYCRA

4-May-18 7.50% 1-May-25 4,768 4,768 4,768 690 96.75 8.21%

Eagle Super Global Holding

B.V (parent), Eagle Global

Holding B.V, Ruyi US Acquisition

Parent Corp, Ruyi US

Acquisition Corp.

EUR 250m 5-year senior first-lien callable secured notes (6)

Eagle Intermediate

Global Holding B.V

(Netherlands), Ruyi

US Finance/ LYCRA

4-May-18 5.38% 1-May-23 1,933 1,933 1,933 280 95.92 6.59%

Eagle Super Global Holding

B.V (parent), Eagle Global

Holding B.V, Ruyi US Acquisition

Parent Corp, Ruyi US

Acquisition Corp.

Total debt, incl out of balance sheet debt 35,372 34,703 36,053 5,217 14.2x

Cash & Cash Equivalent (7) 8,953 8,359 9,710 1,405

External guarantee 2,011 2,011 2,011

Credit facilities (mostly uncommitted(8)) 3,139 3,139 3,139

Net Debt 19,719 19,643 19,643 2,843 7.8x

Net debt, incl out of balance sheet debt 26,419 26,343 26,343 3,812 10.4x

LTM Adj. EBITDA 2,531 Source: Debtwire, company filings (1) No breakdown on loan types for 1Q19. (2) 51.8% owned subsidiary SMCP announced early redemption of the EUR notes due-2023 on 10 May, which would be refinanced by a new EUR 265m amortizing term loan and a EUR 200m revolving credit facilitiy, with 5-year maturity. SMCP also repaid EUR 110m of credit facilitiy previously drawn with the new loans. (3) On 23 Oct 18, issuer adjusted coupon from 5.95% to 7.9% and holders of CNY 96.9m exercised put option. Issuer has option to adjust coupon rate and the note is puttable for investor on 23 Oct 19. (4) At the end of the second and forth years, issuer has option to adjust coupon rate and the note is puttable for investor. (5) According to AR2018, no other detail of the bond is provided. (6) Out of balance sheet bonds, with Ruyi stake in the issuer unknown except that the bond OC stated "the Issuers are entities beneficially owned by the Equity Investors and controlled by Shandong Ruyi Technology Group." (7) Pro forma cash is cash as of 1Q19 after adjustment for bond redeemed and new debt issued between April and this report date. (8) No disclosure on whether the credit facilities are committed or not. However, most of the credit facilities are provided by onshore banks, which are uncommitted.



http://www.sse.com.cn/disclosure/bond/announcement/company/c/3349313278665306.pdf




CREDIT FACILITIES BY LENDERS AS OF 31-DEC-18 (CNY m)

Lenders Total Used Remaining unused

Export-Import Bank of China 2,028 1,831 197

Industrial and Commercial Bank of China 2,043 1,925 118

(French Consortium) 1,951 1,129 821

Bank of China 1,425 1,333 92

Agricultural Bank of China 1,357 1,319 38

China Construction Bank 1,390 1,112 278

Heng Feng bank 1,200 1,086 114

Bank of Communications 888 404 484

ANZ bank 866 866 0

China CITIC Bank 660 585 75

Agricultural Development Bank of China 849 299 550

Taian Bank 400 353 47

Yellow River Rural Commercial Bank 300 297 3

Qilu Bank 300 281 19

Bank of Rizhao 300 205 95

China Everbright Bank 230 212 18

China Bohai Bank 150 150 0

Sumitomo Mitsui Banking Corporation 172 172 0

Baoshang Bank 200 200 0

China Minsheng Bank 190 160 30

Bank of Jining 170 110 60

Weihai City Commercial Bank 150 140 10

Bank of Ningxia 150 145 5

Bank of Shizuishan 100 100 0

Xinjiang Bank 100 100 0

Wenshang Rural Credit Cooperatives 96 96 0

Qi Shang Bank 84 55 29

Zaozhuang Bank 80 80 0

Bank of Tianjin 80 80 0

Bank of Weifang 64 31 33

China Guangfa Bank 50 50 0

China Zheshang Bank 26 2 24

Jining Rural Commercial Bank 23 23 0

Dezhou Bank 13 13 0

China Industrial International Trust 200 200 0

Total 18,284 15,145(1) 3,139

Source: Debtwire, company financials (1) The total credit facilities used of CNY 15.1bn exceeded CNY 13bn total loans disclosed from the balance sheet (see capital structure on page 6), but no explanation was provided in the annual report.

SUBSIDIARIES WITH SHARES PLEDGED TO LOANS (AS OF 31-DEC-18)

Subsidiaries Subsidiaries (Chinese name) Shares owned Shares pledged(1)

Shandong Ruyi Woolen Garment Group Holding 山东如意毛纺服装集团股份有限公司 23.12% 23.12%

Jining Ruyi High-tech Fiber Material 济宁如意高新纤维材料有限公司 100% 100%

Wenshang Ruyi Technological Textile 汶上如意技术纺织有限公司 100% 100%

Xinjiang Ruyi Textile Garment 新疆如意纺织服装有限公司 60% 60.00%

Shandong Jining Ruyi Export & Import 山东济宁如意进出口有限公司 57.8% 57.80%

Shandong Huaneng Ruyi Coal and Electricity 山东华能如意煤电有限公司 50% 41.98%

Source: Debtwire, company filings (1) As of 31-DEC-18 except Shangdong Ruyi Wooden Garment




DEBT MATURITY PROFILE AS OF 31-MAR-19

Source: Debtwire, company filings (1) 1Q18 is the latest data available. YoY % change of 1Q18 or 1Q17 data unavailable, the % change is calculated using 2017 price instead assuming FY18 has similar price level.

RESTRICTED ASSETS AS OF 31-DEC-18

Pledged asset type

Pledged asset Entities Entities (Chinese name) Creditors Book value

(CNY m)

Fixed assets Ruyi Building Shandong Ruyi Technology Group 山东如意科技集

团有限公司 China CITIC Bank 211

Fixed assets Industrial Park factory Shandong Ruyi Technology Group 山东如意科技集

团有限公司 China Construction Bank, Bank of Communications

65

Fixed assets Property Gaoqing Ruyi Textile 高青如意纺织有限公司 Agricultural Bank of China 64

Fixed assets Property Linyi Aotai Textiles 临邑澳泰纺织有限公司 Agricultural Bank of China 5

Fixed assets Factory Ningxia Ruyi Technology Fashion Industry 宁夏如意科技时尚产业有限公司 Export-Import Bank of China, Agricultural Bank of China

99

Fixed assets Property Shandong Ruyi Woolen Garment Group Holding 山东如意毛纺服装集团股份有限公司 China Construction Bank 45

Fixed assets Machinery equipment Wenshang Ruyi Technological Textile 汶上如意技术纺织有限公司 Wenshang Rural Credit Cooperatives 56

Fixed assets Machinery equipment Gaoqing Ruyi Textile 高青如意纺织有限公司 Gaoqing Rural Commercial Bank 28

Fixed assets Machinery equipment Jining Ruyi High-tech Fiber Material 济宁如意高新纤维材料有限公司 Bank of China 135

Fixed assets Machinery equipment Taian Ruyi Technology Fashion Industry 泰安如意科技时尚产业有限公司 Bank of China 94

Fixed assets Total 802

Intangibles Land Taian Ruyi Technology Fashion Industry 泰安如意科技时尚产业有限公司 Bank of China 52

Intangibles Ruyi Building's land Shandong Ruyi Technology Group 山东如意科技集

团有限公司 China CITIC Bank 12

Intangibles Industrial Park factory's land

Shandong Ruyi Technology Group 山东如意科技集

团有限公司 China Construction Bank, Bank of Communications

37

Intangibles Land Gaoqing Ruyi Textile 高青如意纺织有限公司 Agricultural Bank of China 39

Intangibles Land Ningxia Ruyi Technology Fashion Industry 宁夏如意科技时尚产业有限公司 Export-Import Bank of China, ICBC 73

Intangibles Land Shandong Ruyi Woolen Garment Group Holding 山东如意毛纺服装集团股份有限公司 China Construction Bank 27

Intangibles Total 239

Equity shares Equity shares Shandong Ruyi Wool Textile Group 山东如意毛纺集团有限公司 Fudian Bank, Ping An Securities,

Yinchuan Shengrong Investment, Yinchuan Hongying Investment

795

Equity shares Equity shares Shandong Ruyi Technology Group 山东如意科技集团有限公司 Bohai International Trust 318

Equity shares Total 1,113

Cash & cash equivalents

Total 4,106

Total Total 6,259


0.8

7.2

4.6

2.4

2.0

2.1

1.4

0.5

2.9

1.0

0.3

1.5

1.4

0

2

4

6

8

10

12

1 year > 1 Year 2 year 3 year 4 year > 5 year

CN

Y b

n

Finance lease Onshore bondsOffsho re b ond s Bank & other loan sEUR senior secu red notes

COTTON YARN AVERAGE SELLING PRICE VS INPUTS UNIT COST TRNED(1)





WOOLEN FABRICS AVERAGE SELLING PRICE VS INPUTS UNIT COST TRNED(1)


DENIM AVERAGE SELLING PRICE VS INPUTS UNIT COST TRNED(1)


YARN & FABRICS PRODUCTION AND SALES

2015 2016 2017 1Q18(1)

Cotton yarn

Production capacity ('000 tons) 100 200 200 200

Production volume ('000 tons) 81.3 183.5 184.5 41

Utilization rate (%) 81.3% 91.8% 92.3% 20.5%

Sales volume ('000 tons) 71.4 173.3 194.5 40.4

Sales value (CNY m) 2296 3915 4567 917

Average selling price (CNY/ton) 32,163 22,593 23,480 22,706

Sell-through rate (%) 87.8% 94.4% 105.4% 98.5%

Dyed fabrics

Production capacity (m meters) 250 250 250 -

Production volume (m meters) 235 243 182 -

Utilization rate (%) 94.0% 97.2% 72.8% -

Sales volume (m meters) 214 231 170 -

Sales value (CNY m) 1689 1732 1259 -

Average selling price (CNY/meter) 7.89 7.50 7.41 -

Sell-through rate (%) 91.1% 95.1% 93.4% -

Denim

Production capacity (m meters) 30 30 30 30

Production volume (m meters) 27.1 29.0 29.5 8


Sales volume (m meters) 27.8 39.0 37.0 7.0

Sales value (CNY m) 510.0 763.5 783.4 141.2

Average selling price (CNY/meter) 18.32 19.58 21.17 20.17


Woolen fabrics

Production capacity (m meter) 9.9 9.9 9.9 10

Production volume (m meter) 8.4 9.1 9.7 2.4


Sales volume (m meter) 7.0 8.9 7.4 1.7

Sales value (CNY m) 388.0 356.9 284.0 54.5

Average selling price (CNY/meter) 55.58 39.90 38.45 32.81


Source: Debtwire, Apr 19 onshore bond OC (1) 1Q18 is the latest data available, and 1Q17 data is unavailable




RAW MATERIAL PURCHASES

2015 2016 2017 1Q18(1)

Purchases volume

Raw cotton ('000 tons) 68.5 99.2 94.8 23.6

Cotton yarn ('000 tons) 36.7 37.8 25.3 6.2

Grey fabric ('000 meters) 193,024 229,215 155,875 -

PTG ('000 tons) 7.6 10.6 7.2 1.8

Raw wool ('000 tons) 40.4 43.1 32.5 5.2

Wool ('000 tons) 2.4 2.9 2.6 0.5

Average unit cost

Raw cotton (CNY/ton) 15,108 13,995 14,098 14,008

Cotton yarn (CNY/ton) 23,829 22,116 23,201 23,366

Grey fabric (CNY/meter) 5.1 4.7 5.2 -

PTG (CNY/ton) 17,148 17,351 15,644 15,522

Raw wool (CNY/ton) 67,102 71,502 72,632 71,675

Wool (CNY/ton) 74,300 87,952 109,605 85,876

Total purchase cost

Raw cotton (CNY m) 1,035 1,389 ` 331

Cotton yarn (CNY m) 875 835 587 145

Grey fabric (CNY m) 977 1,080 815 0

PTG (CNY m) 130 183 113 28

Raw wool (CNY m) 2,711 3,082 2,361 373

Wool (CNY m) 178 251 285 43

Total (CNY m) 5,906 6,820 5,496 919

Source: Debtwire, 12 Mar 19 onshore bond OC (1) 1Q18 is the latest data available, and 1Q17 data is unavailable

TEXTILE RAW MATERIAL TRADING DATA

2015 2016 2017 1Q18(1)

Cotton

Import volume ('000 tons) 231 125.5 167.3 41.8

Domestic purchase volume ('000 tons) 101.8 180.1 182.5 68.9

Average unit cost (CNY/ton) 12,286 12,695 13,212 12,912



Sell-through rate 97.8% 92.7% 110.7% 108.7%

Unit gross margin 7.7% 5.1% 3.4% 6.7%

Cotton yarn

Import volume ('000 tons) 54.7 55.7 68.1 27.2

Domestic purchase volume ('000 tons) 88.1 135.4 124.6 60.1






Wool top

Import volume ('000 tons) 7.3 5.6 7.7 1.9

Domestic purchase volume ('000 tons) 0 0 0 0


Sales volume ('000 tons) 7.5 6 8.1 1.7




Dyed fabrics

Import volume ('000 meters) 32,392 13,529 9,265 3,681

Domestic purchase volume ('000 meters) 66,193 79,473 90,283 7,512

Average unit cost (CNY/meter) 6.52 5.87 5.51 5.46

Sales volume ('000 meters) 90,370 126,400 114,829 16,286

Average selling price (CNY/meters) 7.43 6.06 5.57 5.53



Source: Debtwire, 12 Mar 19 onshore bond OC (1) 1Q18 is the latest data available, and 1Q17 data is unavailable




FINANCIAL SUMMARY (USDm)

Period-end 31-Dec 31-Dec 31-Dec 31-Dec 31-Mar 31-Mar 31-Mar

INCOME STATEMENT 2015 2016 2017 2018 TTM to Mar 1Q18 1Q19 Revenue 22,770 29,087 35,738 34,282 37,306 8,807 11,831

Change since last year 8.6% 27.7% 22.9% -4.1% 8.8% 0.8% 34.3%

Cost of sales (18,745) (23,054) (26,000) (25,345) (28,698) (6,392) (9,745)

Gross profit 4,026 6,033 9,738 8,938 8,608 2,414 2,085

Gross profit margin 17.7% 20.7% 27.2% 26.1% 23.1% 27.4% 17.6%

Operating expenses (2,667) (4,345) (6,669) (7,451) (6,973) (1,899) (1,421)

EBIT 1,359 1,688 3,069 1,487 1,636 515 665

EBIT margin 6.0% 5.8% 8.6% 4.3% 4.4% 5.9% 5.6%

(+) Depreciation and amortization 343 799 713 888 895 222 229

Adjusted EBITDA 1,702 2,487 3,782 2,375 2,531 737 894

Change since last year 46.1% 52.1% -37.2% 6.6% 34.4% 21.2%

Adjusted EBITDA margin 7.5% 8.6% 10.6% 6.9% 6.8% 8.4% 7.6%

Interest expense, gross (630) (1,216) (1,340) (1,508) (1,603) (278) (374)

Other income and gains (losses) 221 2,385 1,353 3,113 3,080 107 74

Net income (loss) 702 2,496 2,847 2,337 2,349 254 266

BALANCE SHEET 2015 2016 2017 2018 TTM to Mar 1Q18 1Q19

Cash & equivalents 8,396 8,583 9,811 8,953 8,359 9,758 8,359

Accounts receivable 2,943 5,079 6,213 5,769 6,034 6,008 6,034

Prepayments and other receivables 4,199 5,898 8,743 10,806 10,143 8,631 10,143

Inventories 4,064 7,079 6,461 7,903 7,880 6,061 7,880

Total current assets 19,659 26,700 32,021 34,561 33,128 30,989 33,128

Non-current assets 14,780 28,676 30,323 34,162 34,787 30,690 34,787

PP&E net 5,962 10,440 9,472 11,057 10,970 9,732 10,970

Construction in progress 4,145 1,732 2,005 1,620 1,660 1,769 1,660

Investments in JV, associates and equity 1,604 4,149 4,846 4,850 6,142 5,716 6,142

Investments and advances 89 252 267 2,028 2,022 307 2,022

Intangible assets & goodwill 2,271 10,748 11,651 11,624 11,163 11,215 11,163

Other non-current assets 708 1,355 2,081 2,983 2,830 1,951 2,830

Total assets 34,439 55,375 62,344 68,723 67,915 61,680 67,915

Accounts payable 5,646 7,216 6,163 7,323 6,620 6,325 6,620

Accrued and other current liabilities 1,640 4,470 3,279 3,998 3,921 3,050 3,921

Total current liabilities 14,298 20,878 17,346 22,746 21,456 17,290 21,456

Total debt (incl. perpetual bond) 15,372 24,011 25,516 28,008 27,747 24,717 27,747

Short term debt 7,011 9,192 7,890 11,424 10,915 7,902 10,915

Long term debt (including perpetual bond) 8,360 14,819 17,626 16,584 16,833 16,815 16,833

Net debt (incl. perpetual bond) 6,976 15,427 15,705 19,055 19,388 14,959 19,388

Total non-current liabilities 8,694 15,103 18,071 16,757 16,976 17,237 16,976

Total liabilities 22,992 35,981 35,417 39,503 38,431 34,527 38,431

Total equity (excl. perpetual bond) 11,447 19,394 26,927 29,220 29,467 27,152 29,467

Minority Interest 1,526 8,086 15,284 15,914 16,035 15,405 16,035

CASH FLOW STATEMENT 2015 2016 2017 2018 TTM to Mar 1Q18 1Q19

Funds from operations 1,774 4,084 4,949 2,649 NA NA NA

Changes in working capital 276 348 (356) 1,337 NA NA NA

Interest paid (incl. dividend paid for capital securities) (624) (1,565) (833) (1,307) (1,361) (315) (370)

Cash tax (466) (370) (503) (785) (787) (209) (211)

Operating cash flow, adjusted with interest 959 2,498 3,256 1,895 1,871 144 120

Capital expenditures (1,369) (2,194) (2,104) (2,963) (2,936) (82) (55)

Free cash flow (410) 303 1,152 (1,069) (1,066) 62 65

Asset sales 1 121 141 14 1,214 0 1,200

Free cash flow, net (409) 425 1,293 (1,055) 149 62 1,265

Net acquisitions & increase in investments (718) (21,362) (2,856) (1,691) (2,921) (250) (1,479)

Net borrowings 1,604 7,714 1,998 1,435 3,121 (514) 1,171

Equity raised 2,000 13,379 2,194 1,506 1,506

Dividend Paid (394) (394) (644) (655) (655)

Other financing activities 2,035 120 (1,362) (692) (2,023) 645 (686)

Cash flow from investing activities, adjusted (2,079) (23,142) (5,131) (4,563) (4,335) (332) (105)

Cash flow from financing activities, adjusted 5,244 20,819 2,186 1,594 1,949 130 485

RATIO ANALYSIS 2015 2016 2017 2018 TTM to Mar 1Q18 1Q19

Net debt / Adj. EBITDA 4.1x 6.2x 4.2x 8.0x 7.7x - -

Total debt / Adj. EBITDA 9.0x 9.7x 6.7x 11.8x 11.0x - -

Adj. EBITDA / Interest expense 2.7x 2.0x 2.8x 1.6x 1.6x 2.7x 2.4x

Current ratio 1.4x 1.3x 1.8x 1.5x 1.5x 1.8x 1.5x

Quick ratio 1.1x 0.9x 1.5x 1.2x 1.2x 1.4x 1.2x





Source: Debtwire, Jun 17 USD bond OC, company filings, State Administration for Industry & Commerce (SAIC) (1) Look-through stake. (2) Controlling stake (specific stake undisclosed). (3) Ruyi doesn’t disclose the specific stake owns in Lycra, except mentioning it as a >10% minority stake according to 9 May 19 Debtwire report. However, calculating from Debtwire 4 Apr 19 report’s capital contribution breakdown, Ruyi holds about 12.5% in Lycra. (4) Shareholdings according to the latest corporate registry filing and financial reports show that Ruyi holds another 9.41% stake via Ruyi Woolen and Jining Ruyi Import & Export. However, a 28 May 19 stock exchange filing shows that Ruyi holds 17.87% stake held via Ruyi Woolen and Jining Ruyi Import & Export instead, and the updated holding structure is not available.

Offshore Entities

Onshore Entities

USD 345m due –Dec 19s

Beijing Ruyi Fashion Invest-ment Holding Co., Ltd. (北京如

意时尚投资控股有限公司) (PRC)

Yinchuan Financial Holding Co. Ltd (银川市金融控股有限公司)

(PRC)

Mild International Pty Ltd (AU)

Ningxia Ruyi Science and Technology Fashion Indus-

try Co Ltd. 宁夏如意科技时

尚产业有限公司 (PRC)

Linyi Aotai Textile Co Ltd. (临邑澳泰纺织有

限公司) (PRC)

Ningxia Ruyi Ecological Textile Co Ltd. 宁夏如意生

态纺织有限公司 (PRC)

Jining Ruyi Hi-tech Fiber Material Co Ltd 济宁如意高新纤维材料有限公司 (PRC)

Gaoqing Ruyi Textile Co Ltd. 高青如意纺织有限公司

(PRC)

Qingdao Free Trade Zone Ruyi Investment Co Ltd. 青岛保税区如意投资有限公司

(PRC)

Xinjiang Ruyi Textile and Garment Co Ltd. 新疆如意纺织服装有限公司 (PRC)

Shandong Jining Ruyi Import & Export Co Ltd 山东济宁如意进出口有限公司

(PRC)

Shandong Ruyi Woolen Group Co Ltd. 山东如意毛纺集团有限责任公司 (PRC)

Forever Winner International Devel-opment (Australia)

Pty. Ltd. (AU)

Renown Incorpo-rated

(JP) [3606 TYO]

Forever Winner International De-

velopment Ltd. (HK)

SMCP Group S.A.S. (FR)

Prime Bloom Hold-ings Limited (BVI)

Beijing Renown Ruyi Fashion Commercial and Trading Co Ltd. 北京瑞纳如意时尚商

贸有限公司 (PRC)

Shandong Jiada Tex-tile Co Ltd. (山东嘉达

纺织有限公司) (PRC)

80%

CS Agriculture Pty Ltd (AU)

53.5% 26.0% 6.59% 11.72%

64.69%

100%

69%

100%

100%

60%

100%

100%

58.61%(4)

23.12%

52.01%(4)

16.07%(4)

1.8%(4)

70%

14.29%

100%

52.99%

100%

51%

100%

49%

100%

51.8%

Qiu Yafu (邱亚夫) (51%)

Sun Jianhua (孙建华) (19.48%)

Others (29.52%)

Itochu (China) Group Holding Co., Ltd. (伊藤忠

(中国)集团有限公司)

(PRC)

100%

2.2%

Itochu Corporation (JP) [8001 TYO)]

Yinchuan State-owned Assets Supervision & Administration Com-

mission (SASAC) (PRC)

71.77%

79.5%(1)

28.23

100%

Jining Ruyi Energy Tech-nology Development Co.,

Ltd. 济宁如意能源科技发展有

限公司 (PRC)

100%

31%

Jining Gaoxin District Ruyi Jinfu Small Loans LLC. 济宁高新区如意

金服小额贷款有限责任公司 (PRC)

85%

64.97

51%

85.71%

Shandong Ruyi Capital Holding Co., Ltd.

山东如意资本控股有限公司 (PRC)

100%

Wuhu Ruyi Xinbo In-vestment Partnership

LLP. 芜湖如意信博投资合伙企业(有限合伙)

(PRC)

Lempriere (Australia) Co Ltd.

CSTT Holdings Ltd. (SG)

100%

Qingdao Ruyi Fashion Enterprise Management

Consulting Co., Ltd. 青岛如意时尚企业管理咨

询有限公司 (PRC)

99.69

Jining Ruyi Finanicial Holding Investment

Co., Ltd. 济宁如意金控投资有限

公司 (PRC)

Jining Gaoxin Ruyi New Material Technology

Co Ltd. 济宁高新如意新材料科技有限公司

(PRC)

20% Shanghai Printing Net-

work Technology Co Ltd.

上海印刻网络科技有限公司 (PRC)

50%

51%

Huaneng Shandong Ruyi Coal Power Co.,

Ltd. 华能山东如意煤电有限

公司 (PRC)

64.29%

Jining Ruyi Fiber Co., Ltd.

济宁如意纤维有限公司

(PRC)

Yinchuan Huichuang Capital Invest-ment Holding Co., Ltd. (银川汇创资

本投资控股有限公司) (PRC)

Xinjiang Ruyi Fashion and Textile Technology Co Ltd. 新疆如意时尚纺织科技有限公司 (PRC)

Shandong Ruyi Woolen Garment Group Co Ltd.

山东如意毛纺服装集团股份有限公司(PRC)

[002193 SZ]

Wenshang Ruyi Tech-nology Textile Co., Ltd.

汶上如意技术纺织有限公

司 (PRC)

Shandong New Kinetic Energy Ruyi Equity In-

vestment Fund Partner-ship LP. 山东省新动能如意股权投资基金合伙企

业(有限合伙)(PRC)

60%

Jining Xueyan Thermal Power Co., Ltd.

济宁市雪兖热电有限公司 (PRC)

50%

Huaneng Shandong Ruyi (Pakistan) Ener-gy (Private) Co., Ltd.

(PK)

2x660 MW Power Plant (PK)

Trinity Ltd. (HK) [891 HK]

51.9%

Bally International A.G. (CHE)

NA(2)

Bagir Group Ltd. (ISR)

54%(2)

Cubbie Station cot-ton farm (AU)

The Lycra Compa-ny (USA)

NA(2)

≈12.5%(3)

EUR 100m due-Nov 22s

Guarantor for USD 345m due –Dec 19s & USD 300m due-Jul 22s;

Shandong Ruyi Technology Group Co Ltd (山东如意科技集团有限公司) (PRC)

CNY 6.2bn onshore bonds

100%





Disclaimer

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RUYI TEXTILE & APPAREL PRODUCTS VALUE CHAIN

Source: Debtwire, Jun 17 USD bond OC

ADDITIONAL CONTACT INFORMATION

Luc Mongeon Managing Editor, Asia Pacific

+65 6349 8054 [email protected]

Chaim Estulin

Senior Editor, Asia Pacific +852 2158 9725

[email protected]

USEFUL LINKS

1Q19 Financial Report: 30-Apr-19

2018 Annual Report: 30-Apr-19 Part 1 & Part 2

Onshore Bond OC: 15-Apr-19

USD Bond OC: 27-Jun-17

Xtract Research: 21-Nov-16

Debtwire Report: 15-Aug-17

Capital Profile: 28-May 18



https://www.acuris.com/document-repository/document/ByAh7lUAV

https://www.acuris.com/document-repository/document/ryvlzgI0E

https://www.acuris.com/document-repository/document/HJ_Xfe8AV

https://www.acuris.com/document-repository/document/ryo0GeIA4

https://www.xtractresearch.com/Document/viewPdf/id/mkEP8dRuLBINB6FPHjxU#nameddest=

https://www.xtractresearch.com/Covenant/report/id/QMuIYJPQkd7ZqFWS7PjK

https://www.debtwire.com/document-repository/document/Skj6cQlu-


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