February 1 Foxconn Industrial Internet Co., Ltd. (hereinafter referred to Foxconn shares) to submit IPO prospectus draft, February 9, the SFC will release feedback, listing of super-giant Foxconn is accelerating.
As we all know, founded in 1974, Hon Hai Precision is the world's foundry giant electronics, its main business for the mainland Foxconn Group.
According to the official website of Foxconn Group, the company has invested in Mainland China since 1988 and now has more than 1 million employees. Its total import and export volume accounted for 3.6% of China's total import and export volume in 2016, and ranked 27th in Fortune Global 500 in 2017 .
▲ Foxconn Group official website
It should be noted that this proposed Foxconn shares listed on the Shanghai Stock Exchange is not Foxconn's entire business. According to the prospectus, Foxconn, a listed entity, is principally engaged in the design, development, manufacturing and sales of various types of electronic equipment products. Its major products include communications network equipment, cloud service equipment, precision tools and industrial robots.
Although only Foxconn part of the business, but Foxconn shares registered capital reached 17.726 billion yuan, with 269,000 employees, its wholly owned and controlled subsidiaries in China a total of 31, wholly owned and controlled overseas subsidiaries a total of 29, more than 2017 revenue 350 billion yuan, more than 2 times the revenue of Tencent in 2016, with a net profit of more than 16 billion yuan.
At the same time, Foxconn's shares of the business include cloud services, precision tools and industrial robots and Apple's supply chain, Foxconn's most popular business, can be described as elite.
Big Mac: 270,000 employees, annual revenue surpasses 350 billion
As early as June 2015, Gou, Chairman of Hon Hai, said Foxconn's business might be split into the Shanghai and Shenzhen stock markets within the next three to five years.
On December 13 last year, Hon Hai Precision Bulletin, the Board of Foxconn Industrial Internet through a subsidiary of the Public Company Limited initial public offering of ordinary shares of RMB and apply for a listing on the Shanghai Stock Exchange.
January 31 this year, Hon Hai Precision announced its shareholders meeting approved the listing of Foxconn shares of the program.
Foxconn shares formerly known as Carpenter Technology, was established in March 6, 2015, the establishment of less than 36 months. After two replenishment and reorganization in 2017, the registered capital of the company increased to 17.726 billion yuan and its domestic and foreign wholly-owned and holding companies reached 60. Foxconn shares controlling shareholder as the backbone company. Zhongjian Company is an investment-holding company, with 100% equity held by Hon Hai Precision indirectly. As there is no actual controller because of Hon Hai Precision, Foxconn shares do not exist the actual controller.
The Foxconn IPO lead underwriter for the gold company, raising over 27 billion yuan of funds, mainly for intelligent manufacturing, industrial Internet platform construction, communications networks and cloud services.
As a labor-intensive enterprise, Foxconn employs a total of 269,049 people. Among them, the manufacturing 200000 people, accounting for 75.57%; R & D / project 40,000, accounting for 14.90%; sales / administration / management 25662 people, accounting for 9.54%.
Not only many, Foxconn shares of the revenue also belong to the giant.
Foxconn achieved 2015 revenue of RMB272.8 billion, RMB272.7 billion and RMB354.5 billion, respectively. Operating revenue in 2016 decreased slightly by 0.03% from that in 2015 and revenue in 2017 increased by 30.01% as compared with that in 2016.
In terms of net profit, Foxconn shares in 2015-2017 were 14.35 billion yuan, 14.37 billion yuan and 15.87 billion yuan respectively, of which net profit in 2016 increased 0.11% over 2015, and net profit in 2017 increased by 10.45% over 2016.
Although the absolute amount of profit is huge, the net profit margin is not high. In 2017, for example, the net profit of RMB15.87 billion is the revenue of RMB354.5 billion with a net profit margin of less than 5%. The foundry industry has always been small profits and quick turnover. The consolidated gross profit margin of Foxconn for FY2015, FY2016 and FY2017 was 10.50%, 10.65% and 10.14%, respectively, which is comparable to the comparable companies in the same industry.
In addition, as of the end of 2017, Foxconn total assets of 148.6 billion yuan, total liabilities of 120.4 billion yuan, the debt ratio of about 81%, compared with 43% as of the end of 2016 nearly doubled. The increase in Foxconn's liabilities was mainly due to the increase in accounts payable. According to the prospectus, as of the end of 2017, the book value of the Company's accounts payable increased by RMB33,796 million as compared to the end of 2016.
Loaded Apple mobile phone business
Foxconn as a foundry started the traditional manufacturing plant, because of cooperation with Apple and became famous. This time, whether Foxconn Apple mobile phone OEM business into Foxconn shares has become the focus of attention.
At present, Foxconn's base in Zhengzhou has become the main facility for producing Apple's cell phones, and about half of Apple's cell phones are produced here. Foxconn's shares of Fu Tai Wah Precision Electronics (Zhengzhou) Co., Ltd. (Zhengzhou Fu Tai Wah), Henan Yu Chin Precision Technology Co., Ltd. (Henan Yu Chin) are all important manufacturing Apple products factory.
Image Source: Visual China
From a profit point of view, these two companies are also Foxconn shares the best performing subsidiary. As of the end of 2017, Zhengzhou Fu Tai Wah's total assets reached 18.854 billion yuan, net profit in 2017 reached 1.023 billion yuan; as of the end of 2017 Henan Yu Zhan total assets of 91.348 billion yuan, net profit of 2017 amounted to 1.1 billion.
Foxconn shares of Apple's dependence is also reflected in the sales and purchasing orders.
As of the end of 2017, Foxconn is the top three sales orders are being performed by Apple, respectively, 3.027 billion US dollars, 2.62 billion US dollars, 1.876 billion US dollars. Meanwhile, the top three purchase orders being performed by Foxconn shares as of the end of 2017 are also from Apple, with US $ 1,269 million, US $ 855 million and US $ 328 million respectively. Sales orders and purchase orders amount far more than other customers.
However, it is interesting that Foxconn does not seem willing to show this kind of "close relationship" with Apple. When you need to mention Apple, often with "a US famous brand customers" instead.
▲ Image Source: Visual China
In addition, Foxconn said in FY2016, its sales revenue of communications network equipment dropped by 4.82% from FY2015, a slight decrease of 4.82%. The decrease was mainly due to the decrease in orders and unit price of some customers, resulting in the decrease of communications Network equipment, high-precision machine parts sales and average unit prices have declined. In 2016, Apple's iPhone sales fell for the first time, with 207 million units sold, down from 236 million in 2015.
Foxconn said the company's major customers, including Apple, Amazon, Huawei, Dell, Lenovo, Cisco, are all well-known electronics industry brand names, but did not announce the names and specific circumstances of the top five customers. Foxconn said the total revenue from the top five customers accounted for 76.81%, 78.63% and 72.98% of the current operating income respectively, with a high concentration of customers.