BEIJING ― Chinese property developer Kaisa posted on Thursday a 36.3-percent increase in losses, highlighting the persistent challenges faced by real estate firms as home sales decline in a slowing economy.
The Shenzhen-based company in 2015 became the first Chinese real estate group to default on dollar-denominated bonds before charting a financial recovery.
But the property crisis in recent years again weakened the firm, with its total debt estimated at 234.5 billion yuan ($33.0 billion) at the end of the first half of 2024, according to a filing to the Hong Kong stock exchange on Thursday.
Kaisa reported 9.0 billion yuan in losses ($1.3 billion) for the first half of the year.
This falls within estimates made by the group this month predicting a net loss of between 8.8 and 9.8 billion yuan.
Losses increased by 36.3 percent compared to the same period last year when it totaled 6.6 billion yuan ($930 million).
“The complexity and uncertainty of the external environment increased, and the deepening of domestic structural adjustment posed challenges,” the company said in the filing.
Kaisa was founded in Hong Kong in 1999 and has nearly 17,000 employees.
Real estate once served as a vital growth engine for the world’s second-largest economy, undergoing two decades of dazzling expansion as living standards rose across the country.
But the sector has faced unprecedented headwinds in recent years, with some developers on the brink of bankruptcy and falling prices discouraging Chinese investors.
Kaisa announced this month that it had reached an agreement with its creditors for partial repayment of its debt.
The deal comes as other Chinese property giants including Evergrande and Country Garden struggle for survival.
In January, a Hong Kong court ordered the liquidation of Evergrande.
Country Garden ― a private developer long considered financially sound before buckling under major debt ― faces a hearing at a Hong Kong court in January 2025.
Unless a plan for restructuring is reached before then, the company could be ordered into liquidation.
In recent months, the Chinese government has unveiled wide-ranging measures to revive the real estate sector. These, however, have had little effect on sales.
Major cities in China saw another drop in real estate prices in July, indicating demand is still weak.
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