Country Garden broke through and sold 5 billion assets
Reporter丨Jiang Yiwei Editor丨Tan Lu
Smashing pots and selling iron, just to save themselves. Yang Huiyan, chairman of Country Garden, accelerated the sale of assets.
On January 22, Country Garden listed five asset transfer projects on the Guangzhou Equity Exchange, with a total proposed transfer price of up to 3.818 billion yuan.
These projects are all located in Guangzhou, including office buildings, office buildings, hotels, apartment buildings and other properties, all of which have clear property rights, and industry insiders expect that the realizability will be relatively fast.
For Country Garden, which has tight liquidity, the return of funds is a top priority.
At the helm of Country Garden for 11 months, Miss Yang Er used three axes - selling assets, reducing debts, ensuring delivery, and working hard to go ashore.
Sell assets
A month ago, Yang Huiyan said that she would "smash the pot and sell iron to support the company", and her words are still in her ears.
The newly listed assets in Guangzhou are in good condition. Among them, the most expensive price to be transferred is the Phoenix City Hotel in Zengcheng District, Guangzhou, with 1.26 billion yuan.
This is one of the few first-tier city hotel projects in Country Garden, with a total of 573 luxury rooms, with independent and clear property rights, and the purpose of the certificate is a hotel, with a mortgage, and the status quo is operational.
Phoenix City Hotel Source: Guangzhou Equity Exchange
At the same time, there is also Country Garden Phoenix City Aeon Commercial Property, with a proposed transfer price of 250 million yuan.
The project comes with an AEON lease, the certificate is for commercial use, mortgaged, and the status quo is for rent.
For Miss Yang Er, Zengcheng Phoenix City is a project developed by her father Yang Guoqiang personally, with a population of more than 100,000, opened in May 2002, and won the regional sales championship that year.
Another asset of more than 1 billion yuan listed this time is the office building of Country Garden Zanglong Mansion in Panyu District, Guangzhou, with a proposed transfer price of 1.152 billion yuan, separated from Chimelong Safari Park, with a construction area of about 380,000 square meters.
Yang Huiyan is quite aggressive, and some overseas assets are also being sold.
Yang Huiyan Source: Country Garden
Last week, its Australian subsidiary, Risland Australia, planned to sell its remaining land holdings in Sydney for 240 million Australian dollars (about 1.138 billion yuan).
This is Country Garden's last project in Australia, and the company revealed that the project is in contact and is expected to be completed in the first half of the year if it progresses smoothly.
Before January was over, Miss Yang Er's domestic and foreign assets on the shelves had reached nearly 5 billion yuan.
If you count the 3.0685 billion yuan of Country Garden's clearance of the "Wanda system" equity in mid-December last year, nearly 8 billion yuan has been returned.
Shrink the scale
In mid-January, Yang Huiyan said at the annual work conference that the focus of this year's work remains unchanged, which is still to "ensure delivery, operation, and credit", and repair the balance sheet in an orderly manner in the process of ensuring delivery.
In terms of credit protection, the day after the working meeting, Country Garden disclosed that it had appointed KPMG as its financial adviser for overseas debt restructuring.
The company said that it will establish a cooperation and communication platform with all creditors to jointly formulate an overall plan to comprehensively solve the current overseas debt risk.
In the first half of this year, Country Garden's external debt pressure was still not small.
According to the Enterprise Early Warning Link, there are currently 15 US dollar bonds in existence, with a current balance of US$9.91 billion.
Among them, there are two due in 2024, including US dollar bonds with a balance of 965 million (due on January 27) and US dollar bonds with a balance of 537 million (due on April 8), with a total balance of 1.55 billion US dollars.
In terms of onshore bonds, Country Garden has made some progress.
Since the launch of the risk, 9 bonds have been successfully extended, with an overall extension of 3 years, involving an amount of about 14.7 billion yuan, alleviating some of the debt pressure.
While reducing debts, Yang Huiyan also streamlined the team in many rounds and moved to the organizational structure.
When she became chairman in March last year, she reduced the number of regions to 29. In December, she made another move, merging 14 regional companies into 7 new regions, with the intention of co-ordinating and guaranteeing delivery resources.
After some operation, the total number of areas in Country Garden has been reduced from 28 to 21, less than a quarter of the number in 2020.
The organizational structure has changed dramatically, and personnel changes are inevitable.
Yang Guoqiang's nephew Yang Zhicheng, Xie Jinxiong and Ouyang Baokun, who have worked in Country Garden for many years, have withdrawn, and they have been replaced by Hong Bin, Shi Kai and other doctoral talents who have taken over the position of regional president.
According to the 2023 semi-annual report, the number of its employees decreased from 69,932 to 58,140, a year-on-year decrease of 16.9%. This means that one out of every six employees leaves.
Issuance of power insurance
The reduction of rigid expenditures can only temporarily stop the bleeding, and if you want to ensure cash flow, you still have to rely on sales.
In 2023, Country Garden will achieve equity sales of 174.28 billion yuan, a year-on-year decline of more than half of the total, and the situation is not optimistic.
The company expects that the market will still hover at a low level this year, the differentiation of urban sales performance will intensify, and the differentiation between private enterprises and state-owned enterprises will continue to intensify.
Mo Bin Source: Country Garden
Mo Bin emphasized at the 2024 annual work conference that without sales, there is no hematopoiesis.
Country Garden will deliver 600,000 houses in 2023, involving 249 cities in 31 provinces, ranking first in the industry in terms of housing delivery.
However, there is still a gap between the target of 700,000 sets set at the beginning of last year.
"In 2024, the company is expected to deliver more than 480,000 sets, which is still a sky-high delivery task, and the company must be fully prepared in terms of funds, resources and personal status. Yang Huiyan said.
"Under the conservative calculation, as long as our inventory assets are sold normally, assuming that we do not buy land, do not reduce taxes, and do not consider the new contribution of 'one body and two wings', Country Garden will continue to maintain positive assets in the next ten years. Yang Huiyan has been so calming the market sentiment before.
Country Garden will take "guaranteed delivery" as the highest priority business goal, and ensure normal operation through special funds and strict management of pre-sale monitoring funds.
Keeping the bottom line of safety in the delivery of the building is the highlight of Miss Yang Er's current life.