Country Garden, which was the largest real estate developer in China and controlled by the richest woman in the Asian giant, Yang Huiyanhas warned that it expects to register losses of between 45,000 and 55,000 million yuan (5,675 and 6,937 million euros) in the first half of 2023, deepening the collapse of its listing on the Hong Kong Stock Exchange, where the company’s shares closed at record lows, with a fall of 5.77%.
In a statement addressed to the market, Country Garden has attributed the expected losses to the decrease in the gross profit margin of the real estate business and the increase in the impairment of real estate projects as a result of the drop in sales in the real estate industry, as well as loss related to exchange rate fluctuations.
In this sense, the promoter has reported that in the first six months of 2023 it reached sales of 140,800 million yuan (17,756 million euros), which represents a 35% year-on-year decline and a drop of 61% when compared to the company’s revenues in the same period of 2021. Likewise, in the month of July, Country Garden registered a turnover of 12,100 million yuan (1,526 million euros), which which represents the fourth consecutive month of year-on-year falls in revenue, with a decline of 60% compared to July last year and 78% compared to two years ago.
In 2022 and the first half of 2023, Country Garden, together with its joint ventures and associates, delivered approximately 700,000 and 278,000 property units, respectively. A total of almost 700,000 units are expected to be delivered in the whole of 2023. “Since 2021, the sector has entered a period of unprecedented difficulties with multiple unfavorable factors, which has resulted in serious problems for sales and financing in the market”, explained the company, which is causing the Chinese real estate sector to falter again just two years after the start of the problems of another colossus such as Evergrande.
Earlier this week, Country Garden shares already plunged more than 10% after various reports indicated that the company had failed to pay two coupons on its bonds over the past weekend. In the session this Friday, the promoter’s shares closed at Hong Kong dollars 0.98, their lowest level since they began trading, with a fall of 5.77%, which exceeded 14% during some moments of the year. day. So far this year, Country Garden has lost 63% in value.