Shandong Helon Co. (000677), China’s first company to lose its investment-grade credit rating, expects to post a loss of 1 billion yuan ($158 million) for last year, the fiber maker said in a stock exchange filing today.
“Affected by the macroeconomic conditions, the chemical fiber industry underwent a downturn in 2011,” Helon said in a statement to Shenzhen’s stock exchange. “Sales prices dropped sharply in 2011, while raw-materials and production costs remain high, all of which led to a sharp loss for the year.”
Helon, based in Weifang in China’s eastern Shandong province, said Jan. 6 it had 397 million yuan in overdue loans with banks, accounting for 119 percent of the company’s net assets as of its latest audit.
China Lianhe Credit Rating Co., one of the nation’s largest credit rating companies, cut its assessment for Helon in December to BB+, its highest non-investment ranking, by four steps from A-.
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