Type to search

China’s Top Developer Hit by 90% Plunge in Core Profit

China’s biggest property developer says it has endured a “harsh winter” in a market that “won’t recover overnight”, after posting a record net loss of close to $890 million, its first in 16 years.

Shares of China's top private developer plunged on Tuesday, which failed to make bond repayments on Sunday totaling $22.5 million.
Country Garden has 30-day grace periods in which to pay bond coupons, reportedly worth a total of $22.5 million. File photo of company logo from 2018 by Reuters.


Country Garden Holdings – China’s biggest property developer – has posted a record net loss of 6.1 billion yuan ($887 million), its first in 16 years.

The group said on Thursday its core profit plummeted 90% in 2022 amid the country’s property market debt crisis.

Country Garden said core profit, which excludes changes in the value of assets and financial instruments and foreign exchange, was 2.6 billion yuan ($377.36 million), down from 26.9 billion yuan the previous year.

The 6.1 billion net loss is a dramatic reversal from 26.8 billion yuan in net profit in 2021.


China Tech Giants, Hong Kong Surge on Alibaba Breakup Plan


Sector ‘still under great strain’

Country Garden, which was founded in 1992, was listed 138th in the Fortune Global 500 list in 2022 of the world’s top corporations, measured by revenue.

The group had flagged the disappointing results earlier this month, citing a drop in gross profit margin, a rise in provisions for impairments on property projects and net foreign exchange losses.

Property firms in China have struggled to complete projects and sell new houses in a sector hit by a debt crisis since mid-2021.

Many Chinese developers have so far posted a drop in core profit or a loss for their 2022 results, while a few state-backed peers fared better and recorded a rise.

Shares of Country Garden reversed losses after the earnings results, gaining 0.5% as of 0555 GMT. The Hang Seng Mainland Properties Index rose 0.7%.

In Thursday filing, the developer described 2022 as “a harsh winter” for the sector but said the market had bottomed out and was poised for a recovery as favourable economic policies restored industry confidence.

“However, Country Garden has to keep clear-headed because the market will not recover overnight,” it said. “The property sector is still under great strain.”

Its total interest-bearing debts fell 15% to 271.3 billion yuan and its net gearing ratio was 40%, down 5.4 percentage points from end-2021.

The developer said it was determined to transform itself into a high-tech enterprise in the future by developing construction robots and a tech-enabled construction business.


  • Reuters with additional reporting and editing by Jim Pollard





China’s Country Garden Signals First Net Loss Since 2007


China’s Country Garden Shares Plunge on Discounted Share Issue


Developer Country Garden Plans Bond Issue at Beijing’s Request


China’s Country Garden, Midea Secure $3.3bn M&A Funding


Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years.


AF China Bond