New World Development Company (17) H1 2026 earnings summary

Executive summary

• Loss for the first half narrowed to HK$3,730 million, down 44% year-on-year, mainly due to reduced one-off losses, lower financing costs, and lower tax expenses; excluding non-cash provisions, profit attributable to shareholders would be positive.

• Seven debt reduction strategies, including asset sales, cost control, and suspension of dividends, have stabilized operations and finances.

• Major debt exchange completed, reducing perpetual bonds and notes by HK$20 billion and increasing shareholders' equity by HK$8.7 billion, enhancing financial flexibility.

• No interim dividend declared for FY2026, with suspension of dividend and perpetual bond interest payments to support deleveraging.

• Sustained business improvement with a focus on reducing indebtedness, prioritizing cash flow, and prudent capital management in an uncertain market.

Financial highlights

• Core operating profit fell 18% year-on-year to HK$3,636 million due to lower property delivery volume.

• Attributable contracted sales totaled HK$13.8 billion, with HK$10.3 billion from Hong Kong and RMB3.2 billion from the Chinese Mainland.

• Segment results declined 24% year-on-year; IP segment grew 5% excluding asset sales and new openings.

• G&A expenses dropped 18% year-on-year to HK$1.5 billion; CapEx for the first half was HK$3.5 billion, down 29% year-on-year.

• Total financing cost decreased by HK$600 million year-on-year; average interest rate dropped to 3.1% in Dec 2025 from 3.9% in June 2025.

Outlook and guidance

• Over 1,300 units to be launched in Hong Kong in the second half, including new and existing projects.

• CapEx guidance for FY2026 is below HK$12 billion.

• Confident in achieving HK$27 billion full-year contracted sales target.

• Focus remains on accelerating sales, cash recovery, and cost control as market conditions improve.

• Several major projects in Hong Kong and the Chinese Mainland are progressing as planned, with new launches expected in 2026.