China’s state-backed property developer Sino-Ocean Group said on Monday that the trading of its 6% guaranteed notes due 2024 on the Hong Kong Stock Exchange will be suspended from August 14 until further notice.
The trading suspension was due to a default arising from the non-payment of interest of $20.94 million on the notes by August 13, which was the last day of a 14-day grace period, it said in a filing.
Last month, it’s reported that Sino-Ocean proposed to creditors to extend the principal repayment of a 2 billion yuan ($277.29 million) onshore bond due August 2 by one year.
The company said at the time that it intended to negotiate with bond holders to adjust the repayment timetable, it said.
In late July, Moody’s cut the credit ratings of Sino-Ocean’s corporate family rating (CFR) to an almost as risky Caa2 from Caa1 and kept ‘negative’ outlooks to reflect its “weak liquidity and credit profile” and that the likelihood of support from its largest shareholder China Life Insurance “on a timely basis” had also diminished.
Also on Monday, Sino-Ocean said that it expected to record a loss of 17 billion – 20 billion yuan for the first half of the year, compared to a loss of about 1.087 billion yuan for the same period in 2022.
The wider loss was mainly because China’s real estate market as a whole remained sluggish in the first half, leading to falling revenue and gross profit margin and increasing impairment provisions for projects.
Sino-Ocean tumbled more than 5% in Hong Kong to close at HK$0.37 on Monday.
