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ūüö® CNBC: [Modern day Ponzi Scheme] Chinese property developer Evergrande posts $81 billion loss over the past two years

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Chinese property developer Evergrande posts $81 billion loss over the past two years​

  • Evergrande‚Äôs colossal debt pile in recent years has become the source of serious concern about China‚Äôs property sector.
  • Evergrande‚Äôs net losses for 2021 and 2022 were 476 billion yuan ($66.36 billion) and 105.9 billion yuan ($14.76 billion), respectively.
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China Evergrande Group posted a combined loss of $81 billion in its long overdue earnings report late on Monday.

The world’s most indebted property developer fell into default in 2021 and announced an offshore debt restructuring program in March, having struggled to finish projects and repay suppliers and lenders.

Evergrande’s net losses for 2021 and 2022 were 476 billion yuan ($66.36 billion) and 105.9 billion yuan ($14.76 billion), respectively, as a result of writedowns of properties, return of lands, losses on financial assets and financing costs, the company said.

In its last normal year of operation, 2020, Evergrande posted a net profit of 8.1 billion yuan.

Evergrande’s colossal debt pile in recent years has become the source of serious concern about China’s property sector, a bedrock of the Chinese economy, with defaults and abandoned property projects seen across the country. The company’s proposed restructuring is due to be heard at the High Court on July 24.

JPMorgan estimates that around 50 property developers have defaulted on $100 billion of offshore bonds over the last two years, while dozens have been suspended from trading on the Hong Kong stock exchange.

Sandra Chow, co-head of Asia-Pacific research at CreditSights, told CNBC‚Äôs ‚ÄúSquawk Box Asia‚ÄĚ on Tuesday that there will be consolidation in China‚Äôs property market, which is becoming an ‚Äúincreasingly bifurcated sector.‚ÄĚ

CreditSights tracks the monthly contracted sales figures of more than 30 developers, and Chow said only eight had reported increases in their sales numbers.

‚ÄúUnsurprisingly, all of those are the state-linked or the stronger developers, so we‚Äôre seeing this increasing bifurcation where the strong developers are the state-linked, the large players, and the smaller ones are kind of left to languish, and it will be an increasingly consolidated sector,‚ÄĚ Chow explained.

‚ÄúUnderstandably, if you‚Äôre a homebuyer, you‚Äôre not going to buy a house from a weak player as well because there‚Äôs that risk that the developer will not be able to complete your house on time and then you‚Äôre going to be left with that liability, so it‚Äôs quite hard to see how the smaller developers will regain homebuyer confidence and then get the cash in to turn around their businesses.‚ÄĚ


@F-22Raptor @Hamartia Antidote

@beijingwalker
 

Chinese property developer Evergrande posts $81 billion loss over the past two years​

  • Evergrande‚Äôs colossal debt pile in recent years has become the source of serious concern about China‚Äôs property sector.
  • Evergrande‚Äôs net losses for 2021 and 2022 were 476 billion yuan ($66.36 billion) and 105.9 billion yuan ($14.76 billion), respectively.
View attachment 939484

China Evergrande Group posted a combined loss of $81 billion in its long overdue earnings report late on Monday.

The world’s most indebted property developer fell into default in 2021 and announced an offshore debt restructuring program in March, having struggled to finish projects and repay suppliers and lenders.

Evergrande’s net losses for 2021 and 2022 were 476 billion yuan ($66.36 billion) and 105.9 billion yuan ($14.76 billion), respectively, as a result of writedowns of properties, return of lands, losses on financial assets and financing costs, the company said.

In its last normal year of operation, 2020, Evergrande posted a net profit of 8.1 billion yuan.

Evergrande’s colossal debt pile in recent years has become the source of serious concern about China’s property sector, a bedrock of the Chinese economy, with defaults and abandoned property projects seen across the country. The company’s proposed restructuring is due to be heard at the High Court on July 24.

JPMorgan estimates that around 50 property developers have defaulted on $100 billion of offshore bonds over the last two years, while dozens have been suspended from trading on the Hong Kong stock exchange.

Sandra Chow, co-head of Asia-Pacific research at CreditSights, told CNBC‚Äôs ‚ÄúSquawk Box Asia‚ÄĚ on Tuesday that there will be consolidation in China‚Äôs property market, which is becoming an ‚Äúincreasingly bifurcated sector.‚ÄĚ

CreditSights tracks the monthly contracted sales figures of more than 30 developers, and Chow said only eight had reported increases in their sales numbers.

‚ÄúUnsurprisingly, all of those are the state-linked or the stronger developers, so we‚Äôre seeing this increasing bifurcation where the strong developers are the state-linked, the large players, and the smaller ones are kind of left to languish, and it will be an increasingly consolidated sector,‚ÄĚ Chow explained.

‚ÄúUnderstandably, if you‚Äôre a homebuyer, you‚Äôre not going to buy a house from a weak player as well because there‚Äôs that risk that the developer will not be able to complete your house on time and then you‚Äôre going to be left with that liability, so it‚Äôs quite hard to see how the smaller developers will regain homebuyer confidence and then get the cash in to turn around their businesses.‚ÄĚ


@F-22Raptor @Hamartia Antidote

@beijingwalker
Gee 81 B$ that’s more than Pakistan’s total national debt.
 
Gee 81 B$ that’s more than Pakistan’s total national debt.

Technically Pakistan's total external debt alone is $ 120 billion. Total Public Debt & Liabilities is around $ 140 billion; some even say $ 180 billion.
 
Evergrande is an axxhole, the uses financial engineering to turn profit into losses, using excessive leverage and derivative, then shipped all the stolen gains overseas.

They are backed by princelings. That is they are above law for the moment.
 
This company is still existed???

I thought they went bankrupt?
 
That is crazy!!!
That Moron doesn't know that for the most Chinese, their first houses were just give by the government , people only need to save money to buy their second or third houses, many Chinese own more than one house.
 
That Moron doesn't know that for the most Chinese, their first houses were just give by the government , people only need to save money to buy their second or third houses, many Chinese own more than one house.
Seriously? Then Ccp is very rich.
 
Instead off letting the company implode under a $300 billion pile of debt, Chinese authorities opted for what analysts called a ‚Äúcontrolled demolition‚ÄĚ ‚ÄĒ essentially managing the corporation through a gradual collapse. Since then, the company has continued to limp on, posing a continual headache for the policymakers who are trying to restore confidence in the real estate sector.

The group finally came clean about the extent of its near-fatal cash crunch and the slow progress it has made toward resolving its financial difficulties when it released a repeatedly delayed earnings report late on Monday local time.

Aside from the $81 billion in losses, Evergrande’s total liabilities continued to grow in 2022, reaching $335 billion compared with just $251 billion in assets, according to the earnings statement.

Hong Kong-traded shares in Evergrande have been suspended since March 2022, meaning the company is just two months away from being delisted from the stock exchange.

Evergrande also said on Monday that it will meet with its overseas creditors this month to try to reach a deal on debt restructuring.

@beijingwalker modern-day Ponzi scheme
 
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