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the position of president is vacant.

china real estate news reporter zeng dongmei丨guangzhou report

china south city holdings limited (hereinafter referred to as "china south city", 01668.hk) has once again experienced senior management changes.

on september 9, the company announced that geng mei had tendered her resignation as executive director and group chief operating officer, while zheng jiawen had resigned as executive director and authorized representative of the hong kong stock exchange limited. as no suitable successor has been found, the position of ceo will be vacant.

five months ago, qin wenzhong resigned as executive director and group financial director of china south city. as of now, two of the company's four executive directors are from the state-owned enterprise shareholder - shenzhen special economic zone construction development co., ltd. (hereinafter referred to as "special economic zone construction development").

in the first half of this year, sar development continued to lend a helping hand to china south city, which was in trouble, including assisting the company in communicating with financial institutions about loan extensions and interest rate reductions, and promoting the sale of major assets. however, china south city's ability to continue operations remains in doubt. as of the end of june, the total amount of its interest-bearing liabilities due was hk$16.891 billion, while its cash and cash equivalents were only hk$37 million.

three executive directors have resigned this year

geng mei, 53, joined china south city as executive director and group operations president in april 2021, mainly responsible for overall operations and management. prior to this, she served as a cadre of the youth league committee of the international hotel of the national tourism administration, vice president of beijing xinhengji group, vice president of beijing huahan group, managing director of the northern region of ping an real estate co., ltd., and managing director of the headquarters construction and operation center of ping an real estate co., ltd. she has more than 23 years of experience in real estate enterprise operations and management.

cheng jiawen has a rather special background. she is the daughter of zheng songxing, the co-chairman of china south city. as early as 2017, she was appointed as an executive director to participate in the company's operations. she obtained a bachelor's degree in finance and business economics from the university of london, a master's degree in management from imperial college london, and a master's degree in real estate finance from the university of cambridge. she has worked in an investment company and served as an executive director of minsheng international limited. after joining china south city, her work included optimizing administrative systems and structures, overseas financing, mergers and acquisitions, and corporate governance.

china south city said that after zheng jiawen's resignation, zheng songxing will concurrently serve as the authorized representative of the hong kong stock exchange limited. xu hongxia was appointed as the executive director and chairman of harbin china south city co., ltd. xu hongxia is an old employee of china south city, having joined as early as september 2013. she is currently the party secretary, chairman and general manager of harbin china south city.

this year, the executive directors of china south city have changed frequently. in april, qin wenzhong resigned as executive director and group financial director due to job transfer. fang ling, who took over, is in charge of audit internal control, financial management, tax management and fund management, coordinating financing work and being responsible for domestic financing and assisting overseas financing. she has held several positions in sez jianfa and several of its subsidiaries, including director of sez jianfa's operations management department, deputy director of the financial management department, and director of the financial management department of shenzhen sez jianfa investment development co., ltd.

state-owned enterprise shareholders can no longer afford it

as of september 9, china south city has a total of 4 executive directors. in addition to fang ling, wan hongtao is also a representative of sez development. he has served as deputy director of the discipline inspection and supervision office and director of the office (secretariat of the board of directors) of sez development group. since june 2022, he has served as executive director and vice president of china south city, in charge of operations management, strategic coordination and new business development.

li wenxiong, chairman of teda construction development, was parachuted into china south city as co-chairman in september 2022, responsible for formulating the company's overall business model, development strategy, etc., and jointly leading the board of directors with zheng songxing.

in may 2023, li aihua, director of the financial management department of sez development, was appointed as a non-executive director of china south city, responsible for providing advice on the formulation of the company's overall business model, development strategy and major matters.

in addition to sending representatives to the board of directors, sez construction development also provided a lot of help to china south city in terms of operations. in the first half of the year, sez construction development personally supported china south city in communicating with domestic financial institutions, optimizing contract terms, extending repayment periods, and lowering loan interest rates. "it has successfully alleviated the group's cash flow pressure." china south city said.

at the same time, sez construction development also assisted in the sale of major assets of china south city and sought the possibility of acquisition. in addition, the company has repeatedly sent management teams to guide and assist china south city in sales and investment promotion.

judging from the performance of china south city, the effectiveness of these measures is not obvious. in the first half of the year, the company's revenue decreased by 51.7% to hk$1.215 billion, and the net profit attributable to the parent company was a loss of hk$4.311 billion. as of the end of june, its total interest-bearing debt was hk$31.13 billion, its debt-to-asset ratio was 94.7%, its short-term debt was as high as hk$16.89 billion, and its available cash was only hk$37 million.

china south city said that during the reporting period, sales were still not ideal, liquidity continued to be under pressure, and cash was only enough to meet daily operations. as a result, "the group was forced to fail to pay its due debts, resulting in a wide range of debt defaults." as of the end of august, the company had about hk$17.5 billion of interest-bearing liabilities that were not repaid on the scheduled repayment date, triggering a total interest-bearing debt of about hk$13.23 billion to be repaid on demand.

investors believe that szjdc is partly responsible for china south city's tight liquidity. in june, some creditors entrusted relevant institutions to sue szjdc in hong kong, demanding that it fulfill its debt repayment obligations under the "maintenance agreement". so far, no further information has been disclosed on the case.

an investor said that the dollar debt crisis was just the fuse that led to china south city's predicament. after the debts are resolved, it will still have to face the question of what development model to adopt to continue its survival. the moves of midea real estate and gree real estate to divest their real estate development businesses may give the company some inspiration.