Chenming Paper warns of rising debt, discloses overdue repayments

Shandong Chenming Paper Holdings (HKEX:1812) alerted investors to its escalating financial challenges in a new filing, amplified by overdue debts reaching CNY 1.65 billion (approximately $228 million) as of March 31, 2025. The financial strain stems from a combination of a sector downturn and internal operational constraints. The paper manufacturer also confirmed that it is still facing litigation risks as some financial institutions have yet to implement support measures and the company works to mitigate these risks, including extended loan terms and reduced interest rates. The company plans to generate funding via asset disposals and attracting strategic investors, hoping these moves to stabilize production, operational efficiency, and competitiveness. As of 31 December 2024, the auditor of the company, Grant Thornton, issued a qualified opinion on the company's 2024 annual financial report, citing material uncertainties over the group's ability to continue as a going concern. The company's shares are under pressure, and management is urging caution to investors.