(Yicai) Sept. 1 -- Fosun International will shift course from mainly an expansion path to focus on advantageous sectors after resolving its cash flow issue through the sale of non-strategic and non-core assets worth over CNY20 billion (USD2.8 billion) in the first half, according to the chairman of the major Chinese conglomerate.

“We’ve gone through the industry's life cycle, and Fosun's cash flow pressure has been well resolved,” Guo Guangchang told investors yesterday. “From now on, we should focus more on growth and business segments where Fosun has advantages.

Shanghai-based Fosun will no longer focus mainly on expansion, but will commit more resources to advantageous sectors to further clarify and adjust its strategy, Guo said, adding that “development is still fundamental to solving all problems.”

Fosun repaid corporate bonds worth about CNY6.7 billion (USD926.6 million) and over USD2.7 billion of overseas bonds and loans in the first six months of this year, it said in a semi-annual earnings report released on Aug. 30. It also has no dollar-denominated debt maturing in the next 12 months, and had a cash balance of CNY114.7 billion (USD15.8 billion) as of June 30.

Total liabilities on Fosun's consolidated financial statement shrank to about CNY220.9 billion (USD30.4 billion) as of the end of June, versus CNY261.1 billion a year earlier, with debts attributed to Fosun narrowing to CNY94.7 billion (USD13.1 billion). Its debt-to-capital ratio fell to 52 percent, and the average cost of debt was 5.3 percent. 

Fosun will go on paring its liabilities and continue its light asset strategy, Guo said. “It’s time to be braver, as Chinese regulators are constantly issuing supporting policies targeting private firms and the stock market, and overseas rate hikes have reached an end,” he noted.

First-half net profit nearly halved to CNY1.4 billion, its earnings results showed. Revenue rose 11 percent to CNY97.1 billion (USD13.4 billion).

Editor: Martin Kadiev