Reborn as a tycoon in Hong Kong

Taking advantage of his free time on the weekend, Lin Baicheng read the annual reports of his companies in the United States.

It is now mid to late January of 1980. About half a month is enough time for the company to prepare last year's annual report. What's more, the annual report is usually not started after a year, but started in the last month, and then supplemented after the last month has passed, so that the annual report can be produced quickly.

Now in the United States, Lin Baicheng's companies include New Century Software Company, Starlight Company, Morningstar Pictures, Golden Fleece Company, Marvel Comics, Pioneer Technology Venture Capital Company, Sun Electronic Communications Company, and Microsoft Corporation.

In addition to these companies, there are also a number of subsidiaries. For example, Galaxy Semiconductor, a subsidiary of Galaxy Semiconductor, and Venus TV Company, a subsidiary of Venus Electrical Appliances. The annual reports of these two subsidiaries are summarized with the parent company, so there is no need to prepare a separate annual report and submit it to Lin Baicheng.

When reading the annual report, Lin Baicheng did not shy away from Mao Li Haruko and let Mao Li Haruko watch from the side. The two of them looked like one company and one annual report.

New Century Software Company, in 1978, the company's revenue was US$61.5 million and profit was US$39.3 million. At that time, Lin Baicheng still held 100% of the company's shares.

But last year in 1979, Lin Baicheng asked New Century Software to open up financing, giving up 20% of the shares at a post-financing market value of US$660 million, and at the same time transferred 5% of the shares to the management as option rewards. In the end, he was left with 75% shares.

In 1979, New Century Software's revenue and profits exceeded US$100 million, with revenue as high as US$205 million and profits as high as US$112 million. This year's high revenue and high profits are due to the expansion of overseas markets, which has further increased the company's revenue and profits. However, because the costs in overseas markets are higher, the profit margin has decreased, leaving only about 50%, which is no more than last year's profit margin of 60%.

Furthermore, US$112 million was not New Century Software's net profit in 1979. The company's investment last year was not small. Expanding overseas channels requires costs. It cost US$20 million to purchase an office building. The increase in the number of employees also increased expenses. The development of database business and computer operating systems also required a large investment.

It can be said that New Century Software's revenue and profits last year were not low, but the company also spent a lot of money in various aspects. The net profit finally reflected in the annual report was US$61 million.

The reason why New Century Software Company had a net profit of US$61 million last year was because Isabella and other management postponed some expenditures on software research and development, and delayed the allocation of relevant funds until 1980, so that in 1979 The expenses can be reduced and a higher net profit statement can be made.

Today's net profit of US$61 million is 1.5 times that of last year, which is equivalent to a 50% increase in net profit over last year. This kind of data is much better than a net profit that only increased by 20% or 30%.

Before doing so, Isabella specifically asked Lin Baicheng for instructions and explained the reasons, and Lin Baicheng agreed after thinking about it for a while.

The reason for Isabella and other management to do this is simple: to produce good-looking data and prepare for the company's future listing. If the data looks good, not only will the listing be smoother, it will also have a higher price-to-earnings ratio after listing, and it will be more popular among investors.

For Lin Baicheng, New Century Software Company will definitely go public in the future, otherwise he would not have let the company raise funds last year. Therefore, the beautiful data produced by Isabella and others does no harm to him, but has many benefits. He had no reason to refuse.

Haruko Maori said: "If New Century Software can still have a revenue growth of more than 100% and a net profit growth of more than 50% this year, then the company can consider going public next year."

Lin Baicheng shook his head after hearing this: "It will be too soon to go public next year. I am very optimistic about the company's database business and the operating system business of the subsidiary that cooperates with Microsoft. However, these two businesses will definitely not be able to bring much to the company next year." High valuation.”

Haruko Mouri reminded: "Makoto, I think even if you don't want New Century Software to be listed next year, Goldman Sachs and other institutions will promote this matter. They definitely hope that the company will be listed as soon as possible."

"That's true."

Lin Baicheng couldn't help but frown slightly. Wall Street's capital is profit-seeking, and he definitely hopes that the companies he invests in will go public as soon as possible to make money, so that they can recover their costs and make profits faster.

Seeing this, Maori Haruko said: "Cheng-kun, you don't have to worry, this matter is not difficult to solve. Just because you are optimistic about the database business and the subsidiary jointly established by New Century Software and Microsoft, it does not mean that other institutions are also optimistic about it. Cheng-kun, when will you These two businesses can be completely separated from New Century Software. Anyway, New Century Software's current revenue and profits are supported by the office software business."

"The database business and its subsidiary Shiwei Software currently do not create profits for the company at all, and the company even has to continue to invest in them. If Chengjun decides to spin them off from New Century Software Company, maybe the capital on Wall Street will be eager to do so. New Century Software companies can also have a higher valuation when they go public."

What Haruko Mouri said is not unreasonable. Wall Street capital has always disliked investments with uncertain prospects. The better the surface data of all companies, the better. This way Wall Street can inflate the company's valuation, make big claims, and then profit from it. It is the shareholders who ultimately foot the bill.

"What you said is not unreasonable. Make a note of this and separate other businesses to make New Century Software more pure."

Lin Baicheng nodded lightly. It was not good for him to do things like databases and operating systems by himself, but it was fine at the beginning. He could wait for the companies in these two businesses to develop and let New Century Software spend money to acquire them. He might still be able to make a fortune without worrying about taking advantage of Wall Street institutions.

Of course, if Goldman Sachs and other institutions are evil enough and do not want Lin Baicheng to separate other businesses from New Century Software Company, then Lin Baicheng will not insist on it, and he will not fall out with Goldman Sachs and other institutions because of this. Anyway, he has no losses, it is just It just didn't achieve its purpose.

The office software business of New Century Software Company has limitations. Only with the continuous popularization of personal computers can the office software business continue to expand. Fortunately, the current New Century Software Company can still explore overseas markets, and domestic personal computers are also becoming more and more popular, so the ceiling has not been touched yet, and there is money to be made.

Otherwise, once the revenue and profits of New Century Software Company begin to decrease this year in 1980, then there will be a question mark whether New Century Software Company can successfully go public, let alone go public at a higher valuation, and no one will buy it. The stock of a company whose profits have been declining year by year.

Starlight Company's revenue and profit the year before last were US$135 million and just over US$10 million respectively. The reason why the difference between revenue and profit is so large is because Starlight Company is a distributor and its products are not its own, so the profit is only a little more than 10%. After deducting some expenses, the remaining net profit is less than 10% of revenue. .

Last year, Starlight Company's physical stores continued to expand, from more than 600 the year before to more than a thousand today. The sales coverage is wider, and the revenue and profits are naturally higher.

Starlight's revenue last year exceeded US$500 million. The reason why it is so high is because the sales of Star and Moon consoles and cartridges sold by Starlight Game Company in Starlight are also included.

However, although the revenue is high, the profit of Starlight Company is not very good, just over 60 million US dollars. After deducting employee salaries, water and electricity and other expenses, the profit is only 40 million US dollars. This is because the physical stores are owned by the company and there is no rent, otherwise the profits will be even lower.

Forty million US dollars is just operating profit. Starlight Company invested a lot last year. It costs money to expand about 400 physical stores. The company even borrowed another US$20 million from the bank for this purpose. Now it owes the bank up to 50 million US dollars. dollar loan.

In order to make the report data look good, Lin Baicheng agreed to Eric Davis' request. The annual report showed that Starlight's net profit last year was US$20 million, a 100% net profit growth rate.

But the real situation is that Starlight's operating profit of US$40 million last year just filled the hole for expansion. This company did not make a penny for the boss Lin Baicheng last year.

Fortunately, Starlight Company's expansion has been completed, and its channels have spread all over the United States. The company's commissions have been on par with other large companies in the same industry. In addition, there are profit commissions from Rubik's Cube, Star and Moon consoles and cassettes. Since then, this company has not only It can become a stable channel for Lin Baicheng and bring Lin Baicheng a lot of profits every year.

Although the commission for Xingyue consoles and cassettes is from the left to the right, if Lin Baicheng does not have his own channels, then this part of the profits will definitely be earned by other channel companies, and they will demand higher profits, so consignment products The profit commission can also be regarded as the profit earned by Starlight Company for Lin Baicheng.

Morningstar Pictures, a company in which Lin Baicheng invested US$50 million the year before last, only brought Lin Baicheng about US$5 million in profits the year before that, and the company's revenue was only more than US$6 million.

Last year in 1979, Morningstar Pictures' revenue and profits naturally increased. Without counting the movie "Home Alone," the revenue was as high as US$75 million, but the profit was only US$12 million.

The reason why profits are not high is related to the nature of the film industry. It usually takes several months for theaters to get part of their box office share, and it takes half a year or even a year for overseas box office share to be received. Video tapes and other peripherals The same is true for some. There is no way to get all the profits at the first time. In many cases, you can only get part of it first.

This has nothing to do with the size of the company, but it is the same for the entire industry. It is nothing more than that large companies can get relevant profits relatively early.

Therefore, the real profit of Morning Star Pictures last year was actually not more than 12 million US dollars, but there is no way to recover all of it, only this can be recovered on the books.

This does not include the profit that "Home Alone" brought to Morningstar Pictures. Although this movie was invested by Lin Baicheng, Morningstar Pictures, as the distributor, has a 10% omni-channel profit share, which is not a small amount.

The reason why it was not calculated in the 1979 annual report is because "Home Alone" was released before Christmas, and it has only been released for a month now. The theater chain's share of the box office in the first month has been until now. We haven't contacted Morningstar Pictures yet, and Morningstar Pictures can't calculate the relevant profits. How can we calculate this account into last year's annual report?

Fortunately, Morningstar Pictures' profits last year were not bad, so the annual report data is not ugly, and it even had the same 100% net profit growth rate.

Last year, Morningstar Pictures invested a lot of money in channel expansion. Therefore, the real net profit was actually no profit, and the investment was higher than the profit.

Fortunately, Morningstar Pictures has almost completed its channel expansion in North America. This year, it will begin to focus on overseas channel expansion. The first will definitely be the English-speaking region, and then the markets of German, French and other regional countries.

For now, Morningstar Pictures focuses on distribution, supplemented by production, and continues to accumulate capital until it has capital to invest in higher-cost films.

Golden Fleece Company is an offshore company, but the company is headquartered in New York, so it can be regarded as a company in the United States. At least this is how it is arranged when the annual report is compiled.

However, this year is a little different. The price of gold started to rise sharply after Christmas. Lin Baicheng has a large number of long orders for the company to operate. Therefore, everyone in the company has been busy until now and has no time to do the 1979 annual report. Therefore, Golden Fleece's annual report has not yet been released.

Lin Baicheng knows best what the situation of Golden Fleece Company is now, so he certainly won't blame the top management of Golden Fleece Company.

Marvel Comics was just acquired by Lin Baicheng in January last year. He acquired the company for US$30 million, assumed debt of US$40 million, and invested another US$20 million to build his own channels.

Although it was a company that was just acquired last year, Marvel Comics had a profit of US$6 million the year before, and Lin Baicheng knew this.

Last year, Marvel Comics' profits were nearly 10 million US dollars. The reason for such a big change is because self-built channels have brought great changes to Marvel Comics, which has greatly increased profits.

Last year, the Marvel Comics channel had just been established, and the results were not yet obvious. This year, the effects of the channel will definitely be better. It can be expected that Marvel Comics' profits will be higher this year.

However, Marvel Comics cannot bring profits to Lin Baicheng in the short term because the company has liabilities of up to 40 million U.S. dollars. The company began to slowly repay the loan last year, otherwise the annual loan interest will greatly reduce Marvel Comics' net profit.

As for Marvel Comics, Lin Baicheng has no expectation that the company will bring him much profit in the short term. What is important is the superhero copyrights in the company's hands. As long as he holds the copyrights, he will make a lot of money sooner or later in the future. .

When the special effects technology matures, Marvel Comics' superhero movies can begin to show their power. As long as superhero movies start to become popular, Marvel Comics can easily bring ten figures to Lin Baicheng by relying on box office share and peripheral licensing. profit.