Guan Cha Zhe Wang·2025-09-30 06:34Core Viewpoint - New World Development is struggling to return to profitability amid significant losses and ongoing debt issues, with a focus on debt reduction and asset sales to stabilize its financial situation [1][3][5]. Financial Performance - For the fiscal year 2025, New World Development reported a shareholder loss of HKD 16.3 billion, a 38% increase year-on-year [1]. - Revenue decreased by 23% to HKD 27.681 billion, gross profit fell by 10% to HKD 11.626 billion, and core operating profit declined by 13% to HKD 6.016 billion [3]. - Total assets shrank by 5.6% to HKD 420.265 billion [3]. Debt Management - The company has a total debt of HKD 146 billion and a net debt of HKD 120.1 billion, despite a reduction in total debt by HKD 5.7 billion and net debt by HKD 3.6 billion compared to the previous year [5][6]. - New World Development has implemented a "seven debt reduction plans" strategy and continues to prioritize debt reduction in the new fiscal year [1][3]. Asset Sales and Financing - The company has sold several assets, including properties in Beijing and Ningbo, as part of its debt reduction strategy [1]. - New World Development secured HKD 88.2 billion in financing at the end of the last fiscal year and has recently signed a loan agreement with Deutsche Bank for up to HKD 5.9 billion [1][6]. Market Outlook - The Hong Kong property market has shown signs of recovery, with the successful launch of the Kowloon City project, which sold out on its opening day [4]. - The company aims to increase its contract sales target for fiscal year 2026 to HKD 27 billion, up from HKD 26 billion in the previous year [3]. Leadership Changes - The company has undergone significant leadership changes, with the previous leader, Zheng Zhigang, being marginalized and establishing a new investment company outside the family business [2][6]. - New World Development has clarified its relationship with the K11 brand, stating that it remains fully owned by the company, despite Zheng's new ventures [7][8].