Country Garden Issues Profit Alert: Expected Return to Profit in 2025 Driven by Debt Restructuring Gain

Key Highlights

• Country Garden Holdings Company Limited has issued a profit alert, signaling a significant turnaround in its financial performance for the year ended 31 December 2025.
• The Company expects to report a profit ranging from RMB1.0 billion to RMB2.2 billion for the 2025 financial year, reversing the large loss of approximately RMB35.145 billion recorded in 2024.
• The return to profitability is mainly attributed to a non-cash gain from the completion of debt restructuring.
• Excluding this one-off gain, the Company would have recorded a loss, attributed to ongoing pressures on the gross profit margin of its development business and additional impairment provisions for certain assets and property projects.

Details for Investors and Shareholders

Country Garden’s board issued this announcement to inform shareholders, stakeholders, and potential investors of the Company’s expected financial results for the year ended 31 December 2025. This information is based on a preliminary review of unaudited management accounts and other currently available information.

The anticipated profit, in stark contrast to the significant loss in 2024, is primarily a result of the accounting impact from debt restructuring. This means the underlying business remains under pressure, and the reported profit is not reflective of an operational turnaround, but rather a financial adjustment.

Important Shareholder Considerations

• This profit alert is price sensitive and is likely to impact the share price as it marks a shift from deep losses to a reported profit, at least on paper.
• The profit is non-recurring and mainly due to a non-cash accounting gain, not from core business improvement. Investors should be cautious and consider the sustainability of such profits.
• Excluding the debt restructuring gain, the Company would still be loss-making due to industry-wide pressure on gross profit margins and further asset impairments.
• The Company’s financial results for 2025 have not yet been audited or reviewed by the Company’s auditors or audit committee. Investors are advised to review the official annual results, expected to be published in late March 2026.

Outlook and Guidance

Shareholders and potential investors are urged to exercise caution in trading the Company’s securities, as the reported profit is largely a result of non-operational factors and does not necessarily indicate an underlying recovery in the Company’s real estate business.

The Company’s leadership, including President and Executive Director CHENG Guangyu and Chairman Ms. YANG Huiyan, remain at the helm as of the date of this announcement.

Conclusion

The profit alert from Country Garden is a noteworthy event that could move the share price, given the scale of the expected turnaround on reported profit. However, the nature of the gain—stemming from debt restructuring rather than operating improvements—means that investors should remain vigilant and await further details in the audited annual results.

Disclaimer: The information presented here is based on the Company’s announcement and unaudited management accounts. It has not been independently verified or audited. Investors are encouraged to review the full annual results when published and to seek professional advice before making investment decisions. This article is for informational purposes only and does not constitute investment advice.

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