Lai Fung Holdings' loss grows as property sales slump

Lai Fung Holdings reported a net loss attributable to owners of HK$419.4m for the year ended July 31, 2025, up from HK$267.7m in the previous financial year. Turnover fell 41.1% to HK$1,291.3m, driven by a 75.5% reduction in property sales, which amounted to HK$289.1m. This decline was largely attributed to the final phase of sales for Zhongshan Palm Spring residential units and lower sales in Hengqin Novotown Phase I cultural studios and workshop units.

Despite challenging property sales, the group's rental portfolio showed resilience, generating HK$721.8m in rental income, a slight increase of 0.9%. Adjusted EBITDA, excluding fair value changes and non-recurring items, was HK$416.3m, a 46.8% decrease year-on-year. Effective cost control measures led to a 10.5% decrease in administrative expenses and a 58.8% reduction in other operating expenses. Finance costs also decreased by 17.7% to HK$521.9m due to successful refinancing at lower interest rates and a decrease in HIBOR.

As of July 31, 2025, total borrowings increased 4.6% to HK$10,309.2m. The group's total capital resources stood at approximately HK$4,432.6m, comprising cash and bank balances of HK$1,840.8m and undrawn bank facilities of HK$2,591.8m. The net debt to equity ratio was approximately 70%. The company is actively pursuing an asset disposal target of HK$2,000m over the next two years to improve its financial position.