As the saying goes, state-owned enterprises are like iron, and dividends flow like water. But who would have thought that our Henan steel giant, Anyang Iron and Steel, has really been "ironing" things out in the past six months! With the release of the semi-annual report showing a loss of 1.26 billion, one can't help but exclaim that even "Iron Man" would struggle to bear it!
Let's first take a look at who this "Iron Man" really is. Anyang Iron and Steel, just by its name, is a gem from our Henan Anyang. This is not an ordinary enterprise; it is a key listed company under the Henan provincial government, backed by our Henan Provincial State-owned Assets Supervision and Administration Commission. One would think that with such a strong support, life should be quite comfortable, right? So, how did it end up in such a loss?
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Why did Anyang Iron and Steel lose 1.26 billion in just six months?
Speaking of Anyang Iron and Steel's situation, it's really a long story. In the first half of the year, the revenue was 17.65 billion yuan, which looks impressive, but compared to the same period last year, oh dear, it dropped by 16%. And that's not all, their main products—flat-rolled steel, profiles, and other products—didn't just sell less, their prices also fell.
Take flat-rolled steel, for example; last year in the first half, they sold 3.61 million tons, but this year, they only sold 3.18 million tons. And the price? It fell from 3,900 yuan per ton to 3,680 yuan. This drop is not trivial; it wiped out the gross profit, resulting in a loss of 380 million yuan.
But don't think that's the end of it. Anyang Iron and Steel still has to pay for various necessary expenses, such as sales costs, administrative costs, R&D costs, and financial costs, which add up to 1.296 billion yuan. The most heartbreaking part is the financial cost, with interest alone amounting to 340 million yuan. What does this mean? It means they have to pay nearly 1.9 million yuan just in interest every day!
Is Anyang Iron and Steel's predicament an isolated case or an industry norm?
Speaking of Anyang Iron and Steel's situation, it's really not an isolated case. If we look at the entire steel industry, it's quite gloomy. Among listed steel companies, Anyang Iron and Steel's loss of 1.26 billion ranks third, with two even "worse" ones ahead.
Moreover, this is already the third consecutive year that Anyang Iron and Steel has reported a loss in its semi-annual report. Last year, they lost 1.55 billion, and the year before that, they lost 3 billion. At this rate, turning a profit this year seems as difficult as climbing to the heavens.
From this perspective, the predicament of Anyang Iron and Steel may reflect the common issues faced by the entire steel industry. Overcapacity, insufficient demand, heavy environmental protection pressures, coupled with complex international situations, steel companies are generally having a tough time.How about employee benefits and executive compensation? Are they linked to corporate performance?
Speaking of this, it's quite interesting. At the end of last year, Anyang Iron and Steel had 13,400 employees, which is a bit more than the year before. The average compensation per employee was around 130,000 yuan last year, an increase of 8,000 yuan from the previous year. At first glance, it seems not bad, right?
But upon closer examination, there's something intriguing here. In 2021, the average compensation per person was 146,000 yuan. That is to say, although it has increased a bit compared to last year, it is still 16,000 yuan less than the year before. Does this indicate that the company's performance is not good, and the employees' wallets are also getting thinner?
Let's take a look at the situation of the executives. Due to continuous losses, the compensation of the company's executives is not very impressive, basically all below 500,000 yuan. Last year, the highest earner was Deputy General Manager Pan Songjun, with about 420,000 yuan. As for General Manager Wang Chunxiang, it was less than 340,000 yuan. In comparison, it seems that the executives haven't gained too much advantage.
However, we must speak fairly. This "compensation" is not a simple salary; it also includes bonuses, employee welfare expenses, social insurance and housing fund, corporate annuity, supplementary retirement benefits, and so on. And these are all pre-tax figures. So what is actually received might be even less.
Seeing this, do you feel that the situation of Anyang Iron and Steel is somewhat similar to the lives of us ordinary people? When the company's performance is not good, everyone has to tighten their belts. But the question is, why is it so difficult to manage such a large state-owned enterprise?
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