Country Garden China’s 2024 revenue dropped by around 52% year-on-year

Recent financial reports from Sunac China Holdings Limited (Sunac China) indicated a significant decline in performance in 2024, largely due to the sluggish real estate market. According to the announcement released on March 28, Sunac China (01918.HK) reported a 52% decrease in sales contract revenue compared to the previous year.

In 2024, the group recorded a total income of 74.02 billion yuan, showing a 52% year-on-year decrease with a deepening decline. Similarly, the accumulated contract sales amount for the group in 2023 was approximately 84.77 billion yuan, indicating a decrease of nearly 49.94% from the total sales of 169.33 billion yuan in 2022.

The latest announcement revealed that Sunac China’s gross profit in 2024 was 2.89 billion yuan, while the company’s attributable loss was approximately 25.70 billion yuan, significantly higher than the 7.97 billion yuan loss from the previous year. The group’s total contract sales, including joint ventures and associates, amounted to about 47.14 billion yuan.

By the end of 2024, the group had an interest-bearing debt of 259.67 billion yuan, with a cash balance of around 19.75 billion yuan compared to 24.62 billion yuan in 2023. The outstanding principal amount of loans due was approximately 105.8 billion yuan, resulting in a total loan principal amount of about 64.57 billion yuan that might be subject to early repayment.

Sunac China’s equity land reserve stood at around 87.565 million square meters, with approximately 63.01 million square meters remaining unsold.

The struggling real estate giant attributed the decline in revenue primarily to lower property sales income. The continuous downturn in the real estate industry in recent years has led to a significant contraction in the overall sales market. Furthermore, the debt issues faced by several real estate enterprises have eroded buyers’ confidence in off-plan properties, further exacerbating the challenges in new home sales.

On January 10, Sunac China announced in an “Insider Information” disclosure that it had received a winding-up petition from China Cinda (Hong Kong) Asset Management Limited in Hong Kong. The hearing was scheduled for March 19, 2025. Sunac China responded by stating that it would take legal measures to strongly oppose the petition.

This was not the first time Sunac China faced a winding-up petition. On September 8, 2022, Chen Huaijun, a creditor holding $22 million in principal and accrued interest under senior notes, had previously submitted a winding-up petition against Sunac China. In June 2023, Sunac China announced that the Hong Kong High Court had issued an order to dismiss the petition.

According to a report by “Caixin” on January 10, Sunac China’s domestic debt is in the second stage of restructuring, with overseas debts likely entering a renegotiation phase. The announcement stated that considering the impact of the petition on the company and the current market conditions not meeting expectations for overseas debt restructuring, Sunac China might explore a more comprehensive solution for its overseas debt issues. To alleviate debt pressure, Sunac China unveiled a preliminary plan for the second restructuring of domestic debts on November 14 last year.