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Country Garden, one of China’s largest private-run property developer, expects to record a loss of 45 – 55 billion yuan for the first half of the year mainly due to higher impairment provisions on projects, according to a filing to the Hong Kong Stock Exchange on Thursday.
That compares with a net profit of 1.91 billion yuan a year earlier.
That came after the homebuilder said on Tuesday that it had missed two dollar bond coupon payments due on Aug. 6 totalling $22.5 million, slipping into repayment troubles.
The company will take measures to meet its debt obligations, including cutting spending, accelerating cash collection, actively expanding financing channels and optimizing debt repayment arrangements and to fix operational issues to get the company back on track, it said on Thursday.
Country Garden has set up a special task force, headed by its chairman Yang Huiyan, to find ways to improve its operations at a time when the real estate sector is struggling amid a liquidity crunch.
“One shall pick himself up from where he has fallen. The company will adhere to its responsibilities, spare no effort in self-rescue,” the company said in a statement.
In its rescue plan, the company aims to ensure the timely delivery of property projects, while also effectively controlling pre-sale monitoring funds. It said it also intends to adopt various debt management measures and ensure orderly operations, among others.
The company expects to deliver a total of nearly 700,000 units in 2023. It achieved attributable sales of 140.8 billion yuan from January to July 2023, down 35% from a year ago.