Country Garden delays annual results, expects trading suspension

COUNTRY Garden Holdings, once China’s top property developer, warned it will miss its deadline for reporting annual results as more information is needed for appropriate accounting.

The Foshan-based developer expects to delay publishing the 2023 results beyond a Mar 31 deadline, according to a stock exchange filing late on Thursday (Mar 28). The delay will likely result in a suspension of stock trading on April two when the Hong Kong market reopens, the firm said.

“The company needs to collect more information to make appropriate accounting estimates and judgements, and reasonably reflect changes in the industry,” the firm said in the filing.

Country Garden’s auditor is PricewaterhouseCoopers, whose China affiliate audited China Evergrande Group’s main onshore unit, which was accused this month of overstating revenue by about US$78 billion over two years.

The potential delay suggests that the developer’s crisis is entering a new chapter after a Hong Kong court received a creditor’s petition to wind up the company. Country Garden was hailed by many as a survivor just a year ago until it roiled markets when it defaulted on its US dollar debt in October. Earlier this month, it also missed a coupon payment on a yuan bond for the first time.

Its rival China Evergrande Group’s main onshore unit Hengda has been accused by China’s securities regulator of vastly inflating its revenue and profits in 2019 and 2020. Hengda’s auditor in 2019 and 2020 was PricewaterhouseCoopers Zhong Tian, a mainland entity affiliated with PwC’s network. PwC resigned as Evergrande’s auditor in January 2023 due to audit disagreements. BLOOMBERG

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