Thu, 05 Oct 2023

China's Evergrande records $4.5 billion first-half net loss

Robert Besser
30 Aug 2023, 17:06 GMT+10

BEIJING, China: Due to a rise in revenue, China Evergrande Group recorded a narrower net loss for the first half of the year, as reported over the weekend.

The January-June loss was 33 billion yuan ($4.53 billion), compared to a 66.4 billion yuan loss in the same period last year, the company said.

The world's most-indebted property developer is part of China's property sector crisis that began in late 2021, which has witnessed a series of debt defaults, unfinished homes and unpaid suppliers.

The crisis has greatly harmed consumer confidence in the world's second-largest economy.

In a filing, Evergrande said first-half revenue rose 44 percent from one year earlier to 128.2 billion yuan, while cash fell by 6.3 percent to 13.4 billion yuan.

Evergrande said it "actively planned for the resumption of sales and successfully seized the short boom of the property market that emerged at the beginning of the year."

For 2021 and 2022, the company posted a combined net loss of $81 billion, compared to an 8.1 billion yuan profit in 2020, according to a long-overdue earnings report last month.

Due to various uncertainties relating to the business as a going concern, including future cash flow, auditor Prism Hong Kong and Shanghai has not issued a conclusion to the latest report.

After filing for US bankruptcy protection earlier this month as part of one of the world's largest debt restructuring operations, Evergrande said its ability to continue will depend on a successful implementation of an offshore debt restructuring plan.

Courts in Hong Kong and the Cayman Islands will decide in early September whether to approve an offshore debt restructuring plan involving $31.7 billion worth of instruments, including bonds, collateral and repurchase obligations. Creditors voted on the plan last week, while the developer has yet to disclose the result.

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