Developer China Vanke posts 5.95 billion yuan loss in Q1

[BEIJING] China Vanke’s losses dragged on in the first quarter as the embattled developer faces a wall of upcoming debt maturities. 

The company reported a net loss of 5.95 billion yuan (S$1.11 billion) in the three months ended in March, according to a Hong Kong exchange filing on Wednesday. That’s slightly narrower than the 6.25 billion yuan loss a year earlier.  

Vanke’s quarterly loss follows its combined loss of more than 130 billion yuan in the past two fiscal years, signalling persistent earnings erosion under China’s protracted home-price slump. While the pace of decline in China’s newly built homes abated in the first quarter, real estate values are still falling in most regional hubs and smaller cities where the majority of Vanke’s projects sit. 

The developer, which oversees more than a trillion yuan of assets, is one of China’s few major property developers to have so far avoided default. But it has been wrestling with a liquidity crunch for more than two years, and has in recent months turned to continuous bond extensions to buy more time. BLOOMBERG