On March 30, Country Garden’s latest annual report showed that in 2021, Country Garden’s sales scale will remain the industry leader, the scale of debt and financing costs will “double down”, the debt structure will be further optimized, and the financial situation will become more stable.
For the whole year of 2021, Country Garden's equity contracted sales amounted to 558 billion yuan, revenue was 523.06 billion yuan, a year-on-year increase of 13%; gross profit, net profit, and core net profit attributable to shareholders were 92.78 billion yuan, 40.98 billion yuan, and 26.93 billion yuan respectively. The operation maintained a solid advantage.
In the latest annual sales rankings of many third-party institutions such as the Middle Finger Research Institute and Kerui, Country Garden is the only real estate company with a grade of 700 billion, ranking first in the industry with full-caliber sales of 758.82 billion yuan, continuing to lead the industry.
Statistics show that from 2015 to 2021, the compound growth rate of Country Garden's equity contracted sales amount reached 29%.
Although affected by the objective environment, the growth is still outstanding.
In 2022, the main tone of "housing, not speculation" will remain unchanged, and the word "stable" will take the lead.
Mo Bin, President of Country Garden Group, said at the performance conference that Country Garden will continue to respond to the national new urbanization construction strategy and focus on urban development.
In the future, the national market will be further classified, and the market that is in line with the Group's strategic development will be selected according to the market size and supply and demand relationship, and more focus will be placed on the first- and second-tier cities and strong third- and fourth-tier cities headed by metropolitan areas.
Since the beginning of this year, despite the policy "warm wind" in the real estate industry, market sales have been weak under the frequent outbreak of the epidemic.
According to CRIC's statistics, from January to February, the equity-based sales of the top 100 real estate companies decreased by 44.8% year-on-year.
In this context, although Country Garden has declined compared to the previous period due to the downturn in the industry fundamentals, it still achieved attributable sales of approximately 69.12 billion yuan, continuing to maintain its position as the industry leader.
The tenacious and stable sales have laid a solid foundation for the continued improvement of the company's operating performance.
The current industry funding continues to tighten, coupled with the maturity of many housing company bonds, ushering in a debt repayment peak, high-quality repayment and abundant cash flow have become the "lifeline" of housing companies.
In recent years, Country Garden has attached great importance to payment collection, and pursued "profit with cash flow and cash flow with profit" through standardized and refined assessment.
In the whole year of 2021, Country Garden has accumulated a total of 502.2 billion yuan in cash from the sale of equity properties, and the equity collection rate has reached 90%. It has reached 90% or above for six consecutive years, and continues to lead the industry average.
In the first two months of 2022, Country Garden achieved a total of about 65.68 billion yuan in equity sales, and the equity recovery rate exceeded 95%, which further improved.
The higher the sales collection rate, the faster the capital turnover, which is conducive to the realization of a virtuous circle of the company's own funds, which greatly guarantees the safety of the company's operating cash flow.
In 2021, Country Garden's net operating cash flow will be positive, reaching 10.86 billion yuan.
The net cash flow from operating activities is positive, indicating that cash inflows are greater than outflows in operating activities, and its own hematopoietic capacity is strong.
The financial report shows that Country Garden’s debt scale has steadily declined, and its financing costs have been declining year by year.
As of December 31, 2021, the group's cash balance was about 181.3 billion yuan, and the available cash reserves were sufficient; the total interest-bearing debt balance decreased by 2.6% year-on-year to 317.92 billion yuan, of which the proportion of short-term debt dropped to 25%, cash short-term debt than about 2.3 times.
The net gearing ratio was 45.4%, down 10.2 percentage points from the end of the previous year; the weighted average financing cost was 5.2%, down 36 basis points from the end of the previous year.
Country Garden said that the current cash flow is stable, and it will actively repay or repay the bonds due on time in advance, further reduce short-term debt, and maintain stable operations.
In view of Country Garden's continuously optimized operating and financial fundamentals, it has been recognized by rating agencies and major financial institutions and has maintained a stable rating during the industry downturn.
It is reported that since the mainland real estate industry entered a downward cycle in the second half of 2021, the three major international rating agencies have successively downgraded the rating or outlook of the rated real estate companies more than 250 times, reflecting the impact of the industry downturn on the credit qualifications of real estate companies.
In this context, Moody's and Fitch still maintain the "investment grade" rating of Country Garden, while Standard & Poor's maintains the company's "BB+" rating with a "positive" outlook.