KWG Group (1813) investor relations material

Executive summary

• Revenue for the six months ended 30 June 2026 was RMB1,881.1 million, down 50.4% year-over-year, with significant declines in property development and investment segments.

• Net loss for the period widened to RMB2,588.0 million from RMB2,171.7 million in the prior year, driven by lower sales, higher impairment losses, and increased fair value losses on investment properties.

• Gross profit rose 216.1% to RMB295.5 million due to higher-margin contributions from property investment and hotel operations.

• The Group faces severe liquidity challenges, with net current liabilities of RMB42.6 billion and substantial borrowings in default or cross-default.

• A restructuring support agreement was signed with creditors covering offshore debts, aiming to stabilize operations and enhance capital structure.

Financial highlights

• Revenue: RMB1,881.1 million (down 50.4% YoY); property development revenue fell 60.0% to RMB1,228.6 million.

• Gross profit: RMB295.5 million (up 216.1% YoY); gross margin improved due to segment mix.

• Net loss: RMB2,588.0 million (vs. RMB2,171.7 million loss YoY); basic and diluted loss per share: RMB(0.75).

• Finance costs: RMB991.1 million; fair value losses on investment properties: RMB373.9 million.

• Cash and bank balances: RMB719.3 million; restricted cash: RMB419.0 million.

Outlook and guidance

• The Group expects continued market pressure in the second half of 2026, with ongoing focus on sales acceleration, asset disposals, and debt restructuring.

• Policy support is anticipated to stabilize expectations and promote industry transformation.