Yingli Green Energy Holdings, the Tier-1 Chinese solar company, said that it will quicken the pace it generates cash flows from assets having today missed a large debt repayment deadline.
The company failed to repay two outstanding medium-term notes worth RMB 1.76 billion ($270 million) due Thursday, and promptly issued a statement to clarify that it is stepping up efforts to meet its financial obligations.
The statement said that Yingli will "quicken the work pace to generate cash flows from assets", adding that it "will actively promote the restructuring of the company" in order to ease its debt burden.
Yesterday Yingli published its delayed financial results for 2015, revealing debts of more than $1.8 billion and losses for the year that amounted to more than $850 million. Interest paid on loans in 2015 was more than $150 million, the company confirmed.
Yinglis cash-raising strategy appears to be to attract new investors and offload certain assets, having previously been reliant on aggressive and low-interest borrowing from state-backed institutions such as the China Development Bank and Bank of Communications.
However, as Chinas economy faces its weakest growth for nearly a quarter of a century, Premier of the Peoples Republic Li Keqiang appears to have run out of patience with zombie companies saddled with debt and unable, and unlikely to, turn a profit.
Yinglis last profitable quarter was in 2011, and since then the firm has clocked up huge debts with each passing year. In 2014, the former global leader in terms of module sales relinquished its top spot to Trina Solar, and currently just about scrapes into the top ten globally.
On an earnings call held yesterday after the publication of Yinglis financials, chairman Liansheng Miao warned that further defaults on debts were likely, but stressed that Yingli was actively quickening its efforts to resolve the situation.
"We will continue to actively explore methods to improve our operating fundamentals through reducing manufacturing costs and related expenses and pursuing various alternative financing options," Miao said.