SUNAC Updates on Auditor Disclaimer Resolution: Converts US$2.53 B Mandatory Bonds, Repays RMB4.87 B Debt, Secures RMB1.49 B New Financing

Bulletin Express
09/24

Hong Kong – SUNAC released its quarterly progress report on the implementation of its Action Plan aimed at lifting the auditor’s disclaimer of opinion. The update covers the period from 1 January 2026 to 24 September 2026 and highlights continued debt restructuring, incremental financing and cash-flow management initiatives.

Offshore debt restructuring • The zero-coupon Mandatory Convertible Bonds 1 (MCB 1) with an outstanding principal of US$2.53 billion matured on 23 June 2026 and were fully converted into SUNAC shares; the balance is now nil. • Mandatory Convertible Bonds 2 (MCB 2), with principal of US$2.40 billion, remain outstanding; their conversion window opens on 23 June 2027 and they must convert by 23 June 2028. • The company is executing the agreed restructuring with Chiyu Banking Corporation Limited in line with plan.

Onshore and other debt initiatives • Under the onshore debt restructuring, principal and interest repayments begin in June 2029; no payments fell due in the period. • SUNAC repaid RMB4.87 billion of other debt and negotiated extensions on RMB3.43 billion. • Short-term debt maturing within one year stood at RMB148.40 billion as of 30 June 2026. Management is advancing project-specific strategies, including sales-driven repayments, new financing for project revitalisation, debt extensions, interest reductions and asset-for-debt solutions.

New financing and cash inflows • The Group raised RMB1.49 billion in fresh funding during the period. • Collected sales proceeds (contracted sales plus receivable collections) totalled RMB4.38 billion. Ongoing measures target product upgrades, accelerated pre-sales and tighter cash collection to improve liquidity.

Litigation status • Pending litigation cases with single-case claims above RMB50 million total 726, involving RMB262.89 billion. – 20 cases, worth RMB6.08 billion, are under settlement or performance of settlement agreements. – 706 cases, worth RMB256.81 billion, remain in litigation or enforcement; negotiations with creditors continue. – Three cases, involving RMB1.14 billion, were concluded with no material cash-flow impact.

Governance and outlook The Audit Committee reviewed the restructuring, financing and cash-generation measures and considers them commercially viable, assuming no material adverse changes in macroeconomic or sector conditions. SUNAC stated that cash-flow performance during the period met or exceeded internal forecasts and reaffirmed its commitment to executing the Action Plan to remove the auditor’s disclaimer of opinion.

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