Research On The Causes And Countermeasures Of Financial Distress Of CSSC Holdings

The prosperity of China’s economic market and the gradual opening of the registration system have provided more possibilities for companies to go public.The number of new listed companies has been increasing year by year,as well as companies that are in financial distress each year,marked by ST(Special Treatment),financial distress has become one of the inevitable economic phenomena in today’s society.However,it should be noted that ST companies do not necessarily represent the end of de-listing or even bankruptcy,and there are many successful cases of financial distress and positive development after a series of good governance.A correct understanding of the causes of financial distress and effective governance measures are of great significance for normal listed companies to prevent financial distress and companies that have been in distress to successfully get out of financial distress.This paper chooses CSSC Holdings as the research object of financial distress,mainly focused on the whole process of CSSC Holdings in financial difficulties from ST to its successful de-capping.From the concrete research,based on various theories of financial distress,this paper first analyzes the general situation of financial distress of CSSC Holdings by using z-score model and factor analysis method,and then according to the changes of specific indicators in the above methods,in-depth probe into the internal and external causes of the financial distress of CSSC Holdings;then summarize the measures taken by Chinese ships to get rid of St,and analyze the effects of the relevant measures,the paper summarizes the effective measures to deal with the financial distress of CSSC Holdings,and puts forward the corresponding suggestions and enlightenment to the case companies and other distressed enterprises.Through the research of this paper,we can find that in comparison with ten companies in the same industry,the financial risk of CSSC Holdings is higher and the financial performance is worse,and mainly reflected in the profitability,solvency and growth ability of the ability to three weak.In 2018,the company’s financial performance ranked second among 11 companies,and the financial risk also decreased,but in 2019,the company’s financial performance scores fell sharply again Through the analysis of the internal and external causes,we can find that the main causes of the financial difficulties of CSSC Holdings include the downward trend of the global economic situation,the intensification of domestic and foreign competition,the adjustment of domestic policies and other external causes,as well as the implementation of poor strategic planning,unreasonable product structure,imperfect governance structure,financing structure risk and other internal reasons.In order to deal with their own difficulties,CSSC Holdings has taken three major measures,implementing market-oriented debt-to-equity swap,divesting loss-making assets and speeding up the transformation and upgrading.These measures have reduced the financial risk of CSSC Holdings and improved the company’s performance,but the above measures are more embodied in the cost reduction of saving cash outflow,more partial to short-term emergency,the existence of long-term profitability to improve the situation.Based on the above research,the author makes some suggestions to the case companies,other distressed enterprises,relevant supervisory departments.