Chinese developer Evergrande lost $81 billion in 2021-22 – Kommersant

Today, one of the largest development companies in China, Evergrande Group, for the first time in the last two years, published its financial statements for 2021 And 2022 year. Evergrande problems showed up back in the summer of 2021: due to the COVID-19 pandemic and a massive increase in the pace of construction on borrowed funds, home sales began to decline sharply, and debts began to accumulate. In December of the same year, the company experienced a technical default after two consecutive defaults on loans, and its management began a complex process of restructuring, together with the authorities of the country and creditors. For this reason, Evergrande has not released its 2021 and 2022 financials at regular times. Trading in shares by companies was stopped back in 2021. Only in April of this year, a Chinese developer announced on an agreement with a group of foreign creditors to restructure its debt.

The report released today states that Evergrande Group suffered a loss of 476 billion yuan ($66.4 billion) in 2021, and 105.9 billion yuan ($14.8 billion) in 2022. The total debt of the company at the end of 2022 reached 2.4 trillion yuan ($334.6 billion). Analysts were very cautious about Evergrande’s financials. Charles McGregor, Head of Asian Market Research at Singapore-based Lucror Analytics, in an interview Reuters stated that “the publication of the results does not make sense if the company’s business model is destroyed.” On the other hand, analysts Bloomberg Intelligence Daniel Phan and Adrian Sim believe that the resumption of the publication of the results may bring the resumption of trading in the company’s shares on the stock exchange.

Evgeniy Khvostik