New World to keep focus on corporate strategy as stock slumps amid debt troubles

New World Development (NWD) said it will continue to focus on implementing its existing corporate strategy amid concerns about its financial health following a record annual loss and heavier debt load.

“We would like to reiterate that we continue to comply with disclosure requirements and provide timely and appropriate updates to our investors and shareholders,” it said in a statement on Wednesday, adding that it has noticed “a number of untrue speculations and rumours” about the company.

The Hong Kong-listed developer did not elaborate on the nature of the speculation or its corporate strategy. It named Echo Huang Shaomei as CEO on November 29, replacing Eric Ma Siu-cheung after barely two months in the job.

The latest statement came after its shares slumped 6.7 per cent to HK$5.27 on Wednesday, the lowest since at least 1986 according to Bloomberg data. They have declined 20 per cent over the past five days, bringing the slide this year to 55 per cent. The company was listed in 1972.

NWD had HK$123.7 billion (US$16 billion) of consolidated net debt on June 30, according to its annual report. At 55 per cent, its net gearing or debt-to-equity ratio ranked among the highest in the industry. Interest-bearing loans and bonds amounted to HK$151.6 billion. The group reported a record HK$19.7 billion loss in the year to June 30.

The developer wrote to its bank lenders seeking a waiver on loan conditions, Debtwire reported last week, citing people it did not identify. The firm sought forbearance after its net debt-to-assets ratio breached a threshold that may allow lenders to recall their loans, the report said.