Zhengrong Real Estate (06158) announced that since 2022, the group has continued to implement liquidity management and cost savings...
Zhitong Finance App News, Zhengrong Real Estate (06158) announced that since 2022, the group has continued to implement liquidity management and cost saving measures to maintain operational stability by ensuring project construction and delivery, including seeking financing extensions and exemptions, speeding up sales and cash recovery, continuously streamlining the corporate organizational structure, and reducing non-core business operations and administrative expenses. However, due to pressure on the real estate industry's operating and financial environment, as well as negative macroeconomic factors and unfavorable real estate market conditions, the Group's tight contract sales and liquidity conditions have not fundamentally improved, and the speed of asset disposal has fallen short of expectations. As disclosed in the 2023 annual results, the Group's 2023 contract sales decreased by 54.0% compared to 2022. As of the date of this announcement, the Group is still facing enormous operating and financial pressure.
Therefore, considering recent fluctuations in the real estate industry and the performance for the full year of 2023, and the successful implementation of the overall overseas debt management plan depends on many factors beyond the group's control, the company needs more time to consider whether the commercial terms currently included in the restructuring support agreement can still be used as an appropriate solution for the group to resolve overseas debts, thus ensuring that the company maintains long-term sustainable business. The company's management believes that delaying implementation of the plan is prudent and is in the best interests of all of the company's creditors. Accordingly, the company will seek court permission to cancel the hearing currently scheduled for May 2, 2024, as set out in the company's announcement dated January 31, 2024.
The company's overall goal is to preserve the best value for all of the company's creditors and group stakeholders. The company and its advisors will continue to work to arrive at a viable solution for the overall restructuring of the company's foreign debt to ensure the Group's sustainable operation for the benefit of all stakeholders. The company thanks its creditors for their strong support from beginning to end.