Sino-Ocean Group Holding (3377) H1 2024 earnings summary

Executive summary

• Revenue for the first half of 2024 was RMB13,313 million, down 36% year-over-year due to a continued downturn in China's real estate market.

• Gross profit turned positive at RMB297 million (2% margin), compared to a gross loss of RMB125 million (-1% margin) in 1H2023.

• Net loss attributable to owners was RMB5,382 million, a 71% reduction from RMB18,369 million in 1H2023, mainly due to lower impairment provisions and reduced losses from joint ventures and associates.

• Contracted sales fell 49% year-over-year to RMB18,330 million, with saleable GFA sold down 45%.

• No interim dividend was declared for the period.

Financial highlights

• Total assets decreased 5% to RMB195,494 million as of 30 June 2024.

• Equity attributable to owners dropped 86% to RMB1,003 million.

• Cash resources stood at RMB4,709 million, down 6% from year-end 2023.

• Net gearing ratio rose sharply to 650% from 438% at year-end 2023, driven by sales decline and financing challenges.

• Administrative expenses decreased to RMB658 million, reflecting cost control measures.

Outlook and guidance

• The real estate market is expected to remain challenging in the short term, with a shift toward high-quality growth, urban renewal, and asset management.

• The company will focus on high-quality delivery, risk reduction, asset-light transformation, debt restructuring, and cash collection.

• Expansion into asset-light businesses such as agent construction, urban renewal, and non-performing asset management is a strategic priority.