(Bloomberg) -- Country Garden Holdings Co.’s sales slump dragged on in August, exacerbating the Chinese developer’s liquidity woes as it battles a wind-up petition.
Contracted sales for August declined 57% from a year earlier to 3.43 billion yuan ($483 million), following a 72% drop in July, according to an exchange filing on Thursday.
The poor sales underscore the challenges facing the distressed real estate giant, which is counting on a turnaround in revenue to appease debt holders and fight off liquidation. Country Garden said on Thursday it is considering a fresh holistic restructuring plan for yuan bonds after struggling to raise cash for delayed debt repayments.
Offshore, the Foshan-based firm said in July that it plans to make the restructuring support agreement publicly available to all creditors by October. Its wind-up hearing in Hong Kong has been adjourned to late January.
Country Garden’s August sales decline compares with the 26.8% slide at the 100 biggest real estate companies tracked by China Real Estate Information Corp. In the first seven months, its sales slump more than doubled the average decline seen at the top hundred builders.
Country Garden has seen sharper slowdown than its peers due to its focus on projects in smaller cities. As impact of the latest rescue package wanes, new-home sales in so-called tier-3 cities shrank faster, according to a China Index Holdings note.
“With near 80% of land bank in low-tier cities, Country Garden could struggle to boost its contracted sales,” Bloomberg Intelligence analyst Kristy Hung and Monica Si wrote in a note last month.
Trading of Country Garden’s stocks in Hong Kong remain suspended after it further delayed reporting financial results, citing industry volatility and its ongoing debt restructuring.
--With assistance from Foster Wong.
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