Financial Performance Evaluation Of Iron And Steel Enterprises Based On Supply-side Structural Reform ——Take He Gang Group As An Example

At the 12th meeting of the central leading group for financial and economic affairs in 2016,the plan for supply-side structural reform was put forward.As the top priority of this reform,the steel industry has taken a series of measures,such as reducing cost and increasing efficiency,and the steel industry has a significant effect of cutting capacity by 2018.Major steel enterprises are advancing reform and transformation,the construction steel capacity structure has been optimized.The steel industry’s supply and demand situation has also been improved,volume and price rise,China’s steel industry gradually out of the downturn,gross profit has also realized a turnround.This paper adopts the method of case study and comparative analysis,and chooses China’s steel industry a-share listed company--Hegang stock as a case study.In recent years,Hegang group has optimized the user structure and variety structure,strengthened scientific and technological innovation,strengthened internal control and deepened internal reform,and achieved a slight reduction in output and increased benefits.This paper intends to evaluate the effect and deficiency of the supply-side structure reform on the steel industry by analyzing the financial performance indicators of Hegang group in recent years,and compare them with relevant indicators of the same industry,which is of practical significance to the improvement of the financial performance of Hegang group.In this paper,in order to select specific financial indicators,factor analysis method is used to evaluate the financial performance of Hegang group.Through the establishment of the factor analysis model,the correlation between the 27 observed values（financial indicators）of 28 samples（companies）was observed,and the common factors（indicators reflecting the capability of the four aspects of corporate finance）that could reflect the observed values were found and named to obtain the final indicators to be selected in this paper.This makes the selection of indicators more reasonable.In the process of the case study,by collecting the data of the financial statements of the enterprise,SPSS software was used to select the required indicators as follows: profitability analysis selected return on equity,net operating interest rate,and profit margin of costs;Operational capacity analysis and selection of accounts receivable turnover rate,total assets turnover rate;Liquidity ratio,interest protection multiple and equity multiplier are selected for solvency analysis.Development capacity analysis selects the growth rate of total assets and fixed assets.Based on the analysis of the four aspects of Hegang group’s financial data,the conclusion can be drawn: after a series of measures to de-leverage,de-capacity,de-inventory and strengthen the weak points in the supply-side structure reform,Hegang group’s profitability has been greatly improved,and the return on equity and net operating interest have been greatly improved.Operating capacity,accounts receivable turnover and total assets turnover have stopped the trend of a sharp decline and a slow recovery;In terms of solvency,interest coverage ratio is rising,but current ratio is poor.The growth rate of fixed assets,which reflects the development capacity,fluctuates and presents an unstable trend.In a word,although the overall performance of the company has been significantly improved by the supply-side reform,according to the analysis of its financial performance indicators,Hegang group still needs to strengthen cost control in cost management and vigorously research and develop new clean energy.Accounts receivable management to strengthen credit rating management;In terms of capital structure,debt-to-equity swap should be implemented as far as possible to reduce the financial risk of enterprises.