SHIMAO GROUP(HK:00813)2023-09-20 08:44Debt Restructuring and Financial Obligations - The group is actively pursuing a proposed restructuring of its offshore debt, which includes approximately $6.8 billion in US dollar-denominated senior notes and various loans totaling about $2.1 billion and HK$20.9 billion from offshore banks and financial institutions[1]. - The board is confident in obtaining creditor support to complete the proposed restructuring[1]. - The group is seeking alternative financing to meet existing financial obligations and future operational and capital expenditures[2]. - The group has successfully negotiated extensions for long-term bonds and medium-term notes totaling approximately RMB 12.1 billion and RMB 5.4 billion, originally due in 2023 and 2024, respectively[2]. - The company issued a total of USD 450,000,000 in senior notes due on July 3, 2022, with a fixed interest rate of 4.75%[100]. - The total amount of medium-term notes issued by the company was RMB 1,000,000,000, due on October 21, 2022, with a fixed interest rate of 4.24%[102]. - The company issued USD 1 billion senior notes with a fixed interest rate of 6.125%, maturing on February 21, 2024[105]. - The company issued a total of RMB 2.8 billion long-term bonds with a fixed interest rate of 3.90%, maturing on March 25, 2025[112]. - The company issued HKD 3.11 billion (approximately RMB 2.54 billion) convertible bonds with a fixed interest rate of 2.25%, maturing on October 31, 2022[113]. - The company extended the maturity date of the third phase long-term bonds to May 22, 2023, with a fixed interest rate of 4.15%[104]. - The company redeemed RMB 50 million of the second phase private placement notes and agreed to extend the notes[112]. - The company has issued a total of RMB 970 million medium-term notes with a fixed interest rate of 5.15%, maturing on March 16, 2023[107]. - The company had outstanding principal amounts of USD 399,000,000 and HKD 2,486,050,000 under a multi-currency loan agreement as of June 30, 2022, with portions overdue[96]. Financial Performance - The group reported a loss attributable to equity holders of approximately RMB 9.8 billion for the six months ended June 30, 2022[20]. - For the six months ended June 30, 2022, the total revenue was RMB 34,355,924 thousand, a decrease from RMB 73,401,274 thousand for the same period in 2021, representing a decline of approximately 53%[43]. - Property sales accounted for RMB 28,233,677 thousand, significantly down from RMB 66,521,433 thousand in the previous year, indicating a decrease of about 57%[43]. - The company reported a total loss of RMB 9,268,158 for the six months ended June 30, 2022, compared to a profit of RMB 9,477,850 for the same period in 2021[52]. - The operating profit for the six months ended June 30, 2022, was RMB 1,991,643, compared to RMB 15,828,356 for the same period in 2021, indicating a decline in profitability[52]. - The company reported a net loss attributable to equity holders of RMB (9,792,344) thousand for the six months ended June 30, 2022, compared to a profit of RMB 6,282,755 thousand in the same period of 2021, representing a decline of approximately 255%[147]. - Basic loss per share for the six months ended June 30, 2022, was RMB (258.5) compared to earnings of RMB 178.0 per share in the same period of 2021[147]. - Total financing costs for the six months ended June 30, 2022, amounted to RMB 9,781,107 thousand, a substantial increase from RMB 919,254 thousand in the same period of 2021[135]. - The company did not declare any interim dividend for the six months ended June 30, 2022, compared to RMB 5,253,306 thousand in dividends declared for the same period in 2021[142][144]. Asset and Liability Management - As of June 30, 2022, the group's total borrowings amounted to approximately RMB 256 billion, with about RMB 160.3 billion due within the next 12 months[20]. - The total cash (including cash and cash equivalents and restricted cash) was approximately RMB 47.8 billion as of June 30, 2022[20]. - The group had approximately RMB 39 billion of borrowings that were not repaid by the scheduled repayment dates as of June 30, 2022[20]. - As of the report date, the group had approximately RMB 102.4 billion of borrowings that were not repaid by the scheduled repayment dates[20]. - The total assets as of June 30, 2022, were RMB 624,255,200, while total liabilities were RMB 529,178,540[54]. - The company’s total equity attributable to shareholders was not explicitly stated but can be inferred from total assets and liabilities[58]. - The company’s cash and cash equivalents included in current assets were RMB 85,606,940,000 as of June 30, 2022, compared to RMB 66,056,509,000 as of December 31, 2021[67]. - The company provided mortgage financing guarantees amounting to RMB 38,602,678 thousand as of June 30, 2022, an increase from RMB 29,373,762 thousand as of December 31, 2021[150]. - The company reported a net exchange loss of RMB 4,661,444 thousand for the six months ended June 30, 2022, with no exchange loss reported in the same period of 2021[135]. Operational Strategy and Market Conditions - The group aims to accelerate property sales as part of its business strategy plan[2]. - The real estate market continued its downward trend in the first half of 2022, with significant declines in real estate development investment and commodity housing sales, posing substantial challenges to the company's stable development and normal operations[168]. - The company aims to enhance quality and efficiency, focusing on value chain restructuring as a core objective to prepare for strategic transformation[168]. - The company adjusted its supply strategy in response to market fluctuations, postponing or canceling the supply of certain homogeneous products[182]. - The company is actively pursuing debt restructuring and communication with creditors to mitigate financial risks and ensure smooth transitions in domestic and foreign financing[1]. - The company aims to enhance operational capabilities and improve business quality through strategic, operational, organizational, and talent development initiatives[172]. - The company is committed to social responsibility, contributing to pandemic control efforts and promoting sustainable development through green building initiatives[175]. Legal and Compliance Matters - The group is involved in multiple litigation and arbitration cases, indicating significant uncertainty that may affect its ability to continue as a going concern[20]. - The group is confident in reaching solutions for ongoing litigation that currently lacks clear outcomes[2]. - The company is actively seeking various ways to resolve ongoing legal disputes related to comprehensive borrowing or financial guarantees, believing these will not significantly impact current operating performance, cash flow, or financial condition[152]. Revenue and Sales Performance - In the first half of 2022, the company achieved a contract sales amount of RMB 43.77 billion, with a total contracted sales area of 2.709 million square meters[181]. - The company's revenue for the first half of 2022 reached RMB 34.36 billion, with property sales revenue accounting for 82.2% at RMB 28.23 billion, and the recognized sales area was 2.574 million square meters[180]. - The property management segment, Shimao Services, reported revenue of RMB 426.57 million, a year-on-year increase of 12.9%, with managed construction area up 46.2% to 255.9 million square meters[172]. - The property services segment achieved revenue of RMB 4,265.7 million, representing a year-on-year increase of 12.9%, with managed building area up 46.2% to 255.9 million square meters[186]. Asset Disposals and Acquisitions - The group disposed of several assets, including land in Huangpu Road, Shanghai, and the Guangzhou Asian Games City project, to alleviate financial difficulties, generating a net cash inflow of approximately RMB 4.94 billion from these sales[190]. - The total consideration for the assets sold amounted to RMB 5,391,180,000, with a net gain from the sale of assets of RMB 3,402,931,000[160]. - The identifiable net assets sold amounted to RMB 1,988,249,000, with non-controlling interests valued at RMB 567,348,000[160]. - The group completed acquisitions of subsidiary interests totaling approximately RMB 7.997 billion, with non-controlling interests decreasing by about RMB 8.280 billion during the period[192]. - The company agreed to sell all equity interests in two non-wholly owned subsidiaries and two joint ventures for a net consideration of approximately RMB 3,316 million, completed in September 2022[200]. - The company sold all equity interests in another non-wholly owned subsidiary for a total consideration of RMB 1,750 million, completed in October 2022[200].