[Epoch Times October 31, 2021](Epoch Times reporter Li Bing comprehensive report) The three quarterly reports recently released by China’s leading real estate company, Sunshine City, have attracted attention. The financial report showed that Sunshine City lost 1.752 billion yuan in non-net profit in the third quarter, a year-on-year decrease of 274.27%.
Sunshine City released its three quarterly report on the evening of October 28. In the first three quarters, Sunshine City achieved revenue of 41.333 billion yuan (RMB, the same below). The net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses was RMB 86,701,400, a year-on-year decrease of 96.89%.
In the third quarter, many financial indicators of the company declined; revenue was 11.401 billion yuan, down 18.24% year-on-year; net profit attributable to parent was 919 million yuan, down 11.57% year-on-year; non-net profit was a loss of 1.752 billion yuan, down 274.27% year-on-year.
According to the announcement, the two directors appointed by Taikang Insurance, the second largest shareholder, Chen Yilun and Jiang Jiali, voted against the “2021 Third Quarter Report” on the grounds that the company’s performance in the third quarter of the company’s business deterioration requires reasonable management explain.
Sunshine City told the “China Securities Journal” that under the huge industry pressure, the company is indeed difficult in the short term, and the company is also taking all measures to ensure sales and promote payment.
On the day Sunshine City released its third quarterly report, the company was downgraded by Fitch. Its long-term foreign currency issuer default rating (IDR) was downgraded from “B+” to “B-”, and the outlook was “negative”. Sunshine City’s senior unsecured rating was downgraded from “B+” to “B-” and maintained “RR4” Recovery rating.
Fitch placed all Sunshine City ratings on the Standard Watch List (UCO) on October 20, 2021 and has now removed them.
A-share real estate company’s third quarter report released, 24 revenues fell year-on-year
According to Wind Consulting (Wind) statistics, as of 12:00 on October 29, more than 59 A-share real estate companies have announced their third-quarter results.
According to statistics from senior analysts at Tongce Research Institute, among the 59 real estate companies, 24 have experienced a year-on-year decline in operating income, 34 have seen a year-on-year decline in net profit, and 17 real estate companies have increased revenue but not profit; nearly 73% Of real estate companies experienced a decline in profitability.
According to the analysis of the international rating agency Moody’s, the real estate industry in mainland China has fallen into a negative credit cycle. If developers cannot significantly reduce their leverage ratio and repay their due debts, market confidence is unlikely to recover.
Chinese real estate companies will face peak debt repayment periods in 2022 and 2023. The scale of USD bonds due in 2022 is approximately 375.5 billion yuan (approximately USD 59.18 billion), and the scale of USD bonds due in 2023 is approximately RMB 300 billion (approximately USD 47.28 billion).
Evergrande Group previously disclosed that as of June 31, its total debt was 1.97 trillion yuan (about 305.7 billion US dollars). Roughly equivalent to 2% of China’s GDP.
Since the beginning of this year, nine Chinese real estate companies have defaulted on USD debt, including Modern Land, Oceanwide Holdings, Fantasia, China Fortune Land Development, Sunshine 100 China, Tianfang Group, Tahoe Group, Xinli Holdings, and Blu-ray Development, all outstanding. The amount amounts to 28.073 billion US dollars.
Editor in charge: Sun Yun#
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