2003: Starting with Foreign Trade

Chapter 285 Financial Review
"Let's briefly talk about the financial situation of each company as of last month. Flash Technology's final report."

Nowadays, each company's finance department is independent. With the increase in business volume, it is no longer possible to use part-time accountants. After Zhao Xinyi gave the notice at noon, the accountants from each company came over with their computers in the afternoon.

Tan Jincheng needs to understand the financial situation of each company before he can operate the group as a whole.

In addition, that idiot Xin Jingbao is bragging that Tan Jincheng has a net worth of 10 billion. He also wants to know if it is true or not. As the boss, he certainly cannot be completely ignorant of the financial situation of each company, but he really can't be that clear about the specific details.

"Who comes first?"

The finance staff of each company looked at each other in bewilderment. Reporting to the boss on the financial matters is a normal practice, and they usually do so regularly, but today something just felt off.

What felt off was that there was a little girl, not even two years old, sitting next to the boss, nodding with a serious expression. Her little face clearly showed that she was imitating the boss's actions, which made people chuckle.

Tan Jincheng also noticed and couldn't help but find it a little funny. This little guy had been imitating his actions since noon.

"I'll go first then. Our company's financial situation is relatively simple," said the finance manager of Orange Technology with a smile.

"Okay, let's begin."

“Let’s celebrate!” Tan Jinyue chimed in.

"Jin Yue, don't talk. If you keep making a fuss, I'll send you back. I'm busy with important business right now. I'll take you to the amusement park when I'm done."

"Oh, okay." The amusement park is indeed very attractive.

After the children quieted down, the finance manager of Orange Technology continued, "Orange Technology's current financial situation is very simple. Apart from the last business transaction with Zhongtai Auto, we have no other income."

The company just opened last month, so expenses were relatively high, with rent, utilities, and labor costs totaling 150 million yuan. However, starting this month, our expenses will stabilize at around 20 yuan per month, with most of the expenses being labor costs.

In addition, Orange Technology currently holds 1500 million yuan in cash in its accounts, mainly including revenue from its peptide business and previous capital injections.

Orange Technology's finances are really simple, there's not much to say. Before the official launch, the main expense was just labor costs. After the launch period, various marketing expenses will increase.

Orange Technology will not have any revenue for at least the next year. It has to be said that the internet is really a money-burning business. If the promotion is not effective, it will all go down the drain.

People only see the glamour of internet companies after they go public and the extreme impact of getting rich overnight, but they don't know that before that, whether it's a large company or a small company, they are burning money.

Large companies can burn through venture capital and the money they raise, while most entrepreneurs in small companies burn through their own money, it's all or nothing.

In the tide of the times, in any industry and at any opportune moment, there is never a shortage of pigs that are blown away.

"Okay, I understand." Tan Jincheng nodded.

For two small projects like Kaixin.com and Kaixin Farm, 1500 million yuan is an incredibly generous amount that can be spent on marketing. This is a truly extravagant undertaking.

With such a rich treasury, taking Heian Castle shouldn't be a problem, right?
Seeing that the boss didn't say anything, Jin Yi Industrial's finance department then began to report: "Since the Canton Fair last autumn, Jin Yi Industrial's business has started to improve, and the orders at this spring's Canton Fair have increased significantly."

In addition, thanks to the opening up of the export market by FlashTech, by the end of April, we had received a total of 5 export orders at the two exhibitions in Kunming and Shanghai.

The company currently has $1030 million in cash, $507 million in accounts receivable, and $2230 million in outstanding payments to suppliers.

After saying that, the accountant looked at Tan Jincheng with a smug smile. Doing the import and export business of electronic products is really profitable. After deducting accounts payable, there is nearly 100 million yuan in cash on hand, and this is only after participating in two Canton Fairs.

In addition, their cash flow is very abundant. Although FlashTech has a huge electric vehicle business and stores in most cities across the country, its cash flow is not comparable to that of JinYi Industrial.

In terms of earning power alone, none of the boss's companies can compare to Jinyi Industry.

Unfortunately, the boss is career-oriented, not profit-oriented.

"The financial situation is very good. Qin Junchao did a good job. When you get back, please pass on my message that everyone will receive a semi-annual performance bonus after June." Tan Jincheng nodded in satisfaction.

Previously, when considering the grouping of his companies, in order to solve the problems of electric vehicle export business, he also intended to merge Jinyi Industrial into Flash Technology and make it a department of Flash Technology.

Looking back now, it's really a bit of a shame to let go. A company that can provide us with hundreds of millions in cash flow every year seems like a huge waste to directly merge it into Flashpoint Technology.

Damn it, we can't merge, otherwise when we go public, all the money will go to the minority shareholders, and it'll all be my money!

At most, they will simply divest their electric vehicle export business to FlashTech.

"Okay, thank you, boss," the accountant said happily.

Jin Yi Industrial's financial records weren't very complicated, and her job there was quite easy. Besides, after the boss initially established the business channels, Jin Yi didn't manage things much afterwards, and personnel matters were rather lax. If you did your job well, the working hours weren't strictly enforced, and it was common for her to go home to pick up her child before the end of the workday.

"There's not much to say about ByteDance's advertising platform. It doesn't have any investment business at the moment. It just collects rent from the boss's 100 houses. I already reported that last time, so I won't go into details this time."

"Yes, but I will be making some changes to ByteDance Engine later. For example, my shares in Jinpeng Industrial and Mingcheng Industrial will be transferred to ByteDance Engine this month. That's why I called you here. You need to coordinate with the finance departments of these two companies."

"Okay, got it."

With the group taking over, Tan Jincheng will no longer hold any shares in the company, except for stocks; all shares will be held in the company's name.

They're all professionals. The boss has gathered the finances of so many companies under his name to report on their work, and he's also transferring some scattered shares to ByteDance's subsidiary, which clearly indicates that he's about to make a big move.

Witnessing the company's gradual growth, everyone was quite excited.

"Alright, Sister Liu, let's begin." Tan Jincheng gestured to Liu Meilin.

"The sales statistics for electric vehicles in April are not yet available, but as of March this year, we have sold a total of 68,500 electric vehicles. Due to the Olympic Games promotion and the Shanghai exhibition, we expect a significant increase in sales in April."

After the Lunar New Year, both of FlashTech's factories are currently operating at full capacity, with production capacity at its peak. The three months' worth of inventory, plus the electric vehicles produced in April, is more than enough to handle the surge in sales.

Based on the expected shipment volume, sales in April are very likely to reach 4 units or even more. This achievement is enough to break the record for the highest monthly sales of electric vehicles this year. This intensive promotion, coupled with large-scale exhibitions, is a real publicity stunt.

"Just give me a brief overview of how much money is currently in the account; we can skip the other details," Tan Jincheng interrupted.

Compared to other companies that don't have many business segments, FlashTech can talk about data for hours on end, since they can always check the sales reports afterwards.

With the supplier system in place, the ex-factory price of electric vehicles will definitely be reduced, as suppliers need to be given a certain profit margin. Currently, the ex-factory price of various electric vehicles from FlashTech is 600 yuan lower than the market retail price.

The actual sales of 6.85 vehicles amounted to around 1 million yuan. The first half of this year was still a big year for FlashTech's marketing, with marketing expenses increasing significantly compared to when the company was founded last year.

In reality, a profit of around 6.85 million yuan from the sales of 1500 vehicles in the first quarter would be quite good. The only way to reduce costs is to increase sales volume.

However, even though the profit margin is not high now, FlashTech's cash flow has always been good. Due to the setting of the payment collection mechanism, the products sold in the first quarter have been fully paid for.

On the supplier's side, another payment can be delayed. What businesses value is not the final profit margin, but the cash flow.

For businesses, money is only the driving force for development when it is in circulation. Funds that are not in circulation are not very useful. Jinyi Industrial has a lot of money sitting in its accounts, but its future development prospects are not as good as those of Shanchi Technology.

"Including last year's surplus, FlashTech currently has about 1.3 million yuan in cash on hand."

What about the company's debt ratio?

"The company's debt ratio should be kept below 30%." Liu Meilin answered fluently.

Tan Jincheng nodded: "Yes, I understand."

With a debt ratio of only 30% and cash on hand exceeding 1 million yuan, Beicang City Investment's initial investment has at least recouped its costs this year, based on valuation.

In this way, the companies that hold shares under the name of FlashTech, such as Hangxin New Energy, Mingcheng Industry, and Zhongtai Auto, will all be brought under the umbrella of ByteDance through a share swap with the group's parent company, which will greatly reduce the obstacles.

"Alright, each of you should make a simple summary of your financial situation. The data doesn't need to be too detailed. Send a copy to Zhao Xinyi later," Tan Jincheng said after a moment of contemplation.

"In addition, Xinyi, please have Hang New Energy issue a financial report and send it to you as well."

"Alright, that's all for today. Go and get ready. We're going to restructure the company this month and start preparing for group operations. Get ready."

"Group structure, huh?" Those of us in finance naturally understand what group structure means. As soon as Tan Jincheng said this, the finance staff of each company's eyes lit up. The boss was about to go big. Just as the reports said, FlashTech was about to expand.

"Xinyi, once the financial reports are all compiled, please inform Beicang City Investment for me."

"Okay, boss."

"Let's adjourn the meeting. That's all for today. I need to take the kids to the amusement park."

Xiao Jinyue, who hadn't dared to speak the whole time for fear of missing the amusement park, jumped up excitedly from her chair as soon as she heard the words "amusement park," and the atmosphere in the meeting room changed drastically.

I had a bit of a headache and didn't get up until the afternoon, so the update is late. There's another chapter tonight.

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(End of this chapter)