XIN Xinyuan Real Estate Co Ltd

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 6-K

 

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

Under the Securities Exchange Act of 1934

 

FOR THE MONTH OF DECEMBER 2023

COMMISSION FILE NUMBER: 001-33863

 

XINYUAN REAL ESTATE CO., LTD.

 

27/F, China Central Place, Tower II
79 Jianguo Road, Chaoyang District
Beijing 100025
People’s Republic of China

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x                                Form 40-F ¨

 

 

Exhibit Index

 

Exhibit No.	Description
99.1	Press Release of Xinyuan Real Estate Co., Ltd. dated December 27, 2023

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	Xinyuan Real Estate Co., Ltd.
	By:	/s/ Yong Zhang
	Name:	Yong Zhang
	Title:	CEO

 

Date: December 27, 2023

 

Exhibit 99.1

 

Xinyuan Real Estate Co., Ltd. Announces First Half 2023 Financial Results

 

Beijing, December 27, 2023 -- Xinyuan Real Estate Co., Ltd. (“Xinyuan” or “the Company”) (NYSE: XIN), an NYSE-listed real estate developer operating primarily in China with projects in the United States, today announced its unaudited financial results for the six months ended June 30, 2023.

 

First Half of 2023 Highlights

 

•

Gross profit increased by US$29.0 million to US$76.6 million, or 19.7% of total revenue for the first half of 2023 from US$47.6 million, or 8.1% of total revenue for the first half of 2022.

 

•

Selling, general, and administrative (“SG&A”) expenses significantly decreased by 69.2% to US$21.9 million for the first half of 2023 from US$71.0 million for the first half of 2022. As a percentage of total revenue, SG&A expenses were 5.6% and 12.2% for the first half of 2023 and 2022, respectively.

 

•

Total debt outstanding was US$2,044.0 million as of June 30, 2023, a decrease of 4.5% from US$2,140.4 million as of December 31, 2022.

 

Financial Results for the First Half of 2023

 

Revenue

 

For the first half of 2023, the Company’s total revenue decreased by 33.5% to US$388.2 million, compared to US$584.1 million for the first half of 2022, and the Company’s average selling price per square meter for real estate properties sold in China increased by 45.6% to RMB15,413 (US$2,226), compared to RMB10,585 (US$1,633) for the first half of 2022. The decrease in revenue was mainly due to a significant decline in signings, which were affected by the overall downturn in the real estate industry.

 

Gross Profit

 

Gross profit increased by US$29.0 million to US$76.6 million, or 19.7% of total revenue for the first half of 2023 from US$47.6 million, or 8.1% of total revenue for the first half of 2022. Mainly due to optimization of project costs.

 

SG&A Expenses

 

SG&A expenses significantly decreased by 69.2% to US$21.9 million for the first half of 2023 from US$71.0 million for the first half of 2022. As a percentage of total revenue, SG&A expenses were 5.6% and 12.2% for the first half of 2023 and 2022, respectively. The main reason is that the Company took various measures to control SG&A expenses, such as salary cuts and stricter control of office expenses.

 

Net Loss

 

Net loss decreased by US$125.8 million to US$46.7 million for the first half of 2023 from US$172.5 million for the first half of 2022.

 

Balance Sheets

 

As of June 30, 2023, the Company’s cash and restricted cash decreased to US$380.8 million from US$560.7 million as of December 31, 2022.

 

Total debt outstanding was US$2,044.0 million as of June 30, 2023, a decrease of 4.5% from US$2,140.4 million as of December 31, 2022.

 

 

The balance of the Company’s real estate properties completed and under development at the end of the second quarter of 2023 was US$3,112.7 million compared to US$3,277.1 million as of December 31, 2022.

 

Completion of Exchange Offer and Consent Solicitation of Certain Notes

 

The Company has been proactively making effort to resolve debts both from domestic and foreign institutions since June 2022, and has reached or agreed into resolutions or settlements with institutions through various approaches.

 

On June 12, 2023, the Company announced an exchange offer to holders of the senior secured notes issued by the Company. The Exchange Offer expired at 5:00 p.m., Hong Kong time, on June 28, 2023 (the “Exchange Expiration Deadline”). As of the Exchange Expiration Deadline, US$307,363,580, or 46.6%, of the total aggregate outstanding principal amount of the Existing Notes were validly tendered for exchange for the Exchange Consideration. On August 18, 2023, US$307,363,580 of the total aggregate outstanding principal amount of the Existing Notes were exchanged and the Company (i) delivered the New Notes in the aggregate principal amount of US$331,303,941 and (ii) made a payment of Consent Fees in cash in the amount of US$1,536,863.12 in full satisfaction of the Exchange Consideration to the Eligible Holders whose Existing Notes had been validly tendered and accepted for exchange. Capitalized terms used but not defined herein have the meanings ascribed to them in Exhibit 99.1 of the Company’s report of foreign private issuer on Form 6-K filed on August 22, 2023.

 

This debt restructuring brought approximately US$140 million debt restructuring income to the Company, increasing the Company’s equity significantly. The pro forma financial statements after recording this debt featuring are shown below.

 

About Xinyuan Real Estate Co., Ltd.

 

Xinyuan is an NYSE-listed real estate developer primarily in China with projects in the United States. In China, Xinyuan develops and manages large-scale, high-quality real estate projects in over ten tier one and tier two cities, including Beijing, Shanghai, Tianjin, Zhengzhou, Jinan, Qingdao, Chengdu, Xi’an, Suzhou, Dalian, Zhuhai and Foshan. Xinyuan was one of the first Chinese real estate developers to enter the U.S. market and over the past few years has been active in real estate development in New York. Xinyuan aims to provide comfortable and convenient real estate related products and services to middle-class consumers. For more information, please visit http://www.xyre.com.

 

Forward Looking Statements

 

Certain statements in this press release constitute “forward-looking statements.” These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements about future debt and financial position, potential future collaborative efforts, among others, and can generally be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Statements that are not historical statements are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including, but not limited to, our ability to continue to implement our business model successfully; our ability to secure adequate financing for our project development; our ability to successfully sell or complete our property projects under construction and planning; our ability to successfully enter new geographic markets, develop new business lines and expand our operations; the marketing and sales ability of our third-party sales agents; the performance of our third-party contractors; the impact of laws, regulations and policies relating to real estate developers and the real estate industry in the countries in which we operate; our ability to obtain permits and licenses to carry on our business in compliance with applicable laws and regulations; competition from other real estate developers; the growth of the real estate industry in the markets in which we operate; the impact of pandemics, such as the COVID-19 pandemic, on the real estate market and the economies in our markets; fluctuations in general economic and business conditions in the markets in which we operate; and other risks outlined in our public filings with the U.S. Securities and Exchange Commission, including our annual report on Form 20-F for the year ended December 31, 2022. Except as required by law, we undertake no obligation to update or review publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statement is made.

 

 

Notes to Unaudited Financial Information

 

This release contains unaudited financial information, which is subject to year-end audit adjustments and has not undergone external review. Adjustments to the financial statements may be identified when the audit work is completed, which could result in significant differences between our audited financial statements and this unaudited financial information.

 

For more information, please contact:

 

Xinyuan Real Estate Co., Ltd.

Investor Relations

Tel: +86 (10) 8588-9376

Email: irteam@xyre.com

 

 

XINYUAN REAL ESTATE CO., LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(All US$ amounts and number of shares data in thousands, except per share data)

 

		Six months ended
		June 30,				June 30,
		2023				2022
		(unaudited)				(unaudited)
Total revenue			388,241				584,123
Total costs of revenue			(311,640	)			(536,560	)
Gross profit			76,601				47,563
Selling and distribution expenses			(2,264	)			(19,374	)
General and administrative expenses			(19,642	)			(51,669	)
Gain/(loss) on disposal of property held for lease			-				(256	)
Operating income/(loss)			54,695				(23,736	)
Interest income			2,858				1,159
Interest expenses			(85,290	)			(83,770	)
Loss on short-term investments			(2,185	)			(69,828	)
Gain on extinguishment of debt			2,897				-
Debt restructuring income			8,755				-
Other (expenses)/income			(1,774	)			729
Exchange gain			17,975				22,040
Share of loss of equity investees			(7,846	)			(23,356	)
Income/(loss) from operations before income taxes			(9,915	)			(176,762	)
Income tax (expenses)/benefits			(36,765	)			4,274
Net loss			(46,680	)			(172,488	)
Net income/(loss) attributable to non-controlling interest			8,045				(11,849	)
Net income/(loss) attributable to Xinyuan Real Estate Co., Ltd. shareholders			(38,635	)			(184,337	)
Income/(loss) per ADS:
Basic			(7.17	)			(3.45	)
Diluted			(7.17	)			(3.45	)
ADS used in computation:
Basic			5,388				53,466
Diluted			5,388				53,466

 

 

XINYUAN REAL ESTATE CO., LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(All US$ amounts and number of shares data in thousands)

 

		June 30,				December 31,
		2023				2022
		(unaudited)				(audited)
ASSETS
Current assets
Cash and restricted cash			380,777				560,728
Short-term investments			9,304				11,993
Accounts receivable			12,004				32,588
Other receivables			372,267				383,513
Deposits for land use rights			31,340				33,858
Other deposits and prepayments			282,848				322,170
Advances to suppliers			48,024				54,229
Real estate properties development completed and under development			3,112,657				3,277,057
Amounts due from related parties			193,246				203,719
Amounts due from employees			4,140				1,466
Other current assets			13,987				7,886
Total current assets			4,460,594				4,889,207
Restricted cash, non-current			-				-
Real estate properties held for lease, net			341,954				373,468
Property and equipment, net			26,141				28,831
Long-term investment			82,605				92,473
Deferred tax assets			299,623				304,516
Deposits for land use rights and properties			31,830				33,024
Amounts due from related parties			12,135				15,056
Contract cost assets			64,880				52,516
Operating lease right-of-use assets			2,997				5,708
Other assets			54,642				55,479
TOTAL ASSETS			5,377,401				5,850,278

 

 

XINYUAN REAL ESTATE CO., LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(All US$ amounts and number of shares data in thousands)

 

		June 30,				December 31,
		2023				2022
		(unaudited)				(audited)
LIABILITIES AND
SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and notes payable			954,951				950,184
Short-term bank loans and other debt			62,042				81,598
Customer deposits			927,284				1,280,517
Income tax payable			212,954				241,221
Other payables and accrued liabilities			563,511				489,623
Payroll and welfare payable			10,969				16,432
Current portion of long-term bank loans and other debt			1,466,390				1,653,120
Lease liability, current portion			2,032				3,781
Mandatorily redeemable non-controlling interests			10,217				9,864
Amounts due to related parties			73,320				66,620
Total current liabilities			4,283,670				4,792,960
Non-current liabilities
Long-term bank loans			337,699				146,603
Other long-term debt			177,833				259,081
Deferred tax liabilities			414,267				429,975
Unrecognized tax benefits			147,327				135,562
Lease liability			1,691				3,310
Amounts due to related parties			-				-
TOTAL LIABILITIES			5,362,487				5,767,491
Shareholders’ equity
Common shares			16				16
Treasury shares			(116,062	)			(116,062	)
Additional paid-in capital			544,955				544,955
Statutory reserves			179,320				179,457
Retained earnings			(696,600	)			(656,638	)
Accumulated other comprehensive loss			(37,804	)			(21,615	)
Total Xinyuan Real Estate Co., Ltd. shareholders’ equity			(126,175	)			(69,887	)
Non-controlling interest			141,089				152,674
Total equity			14,914				82,787
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY			5,377,401				5,850,278

 

 

XINYUAN REAL ESTATE CO., LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(The pro forma financial statement after recording this debt restructuring)

(All US$ amounts and number of shares data in thousands, except per share data)

 

		June 30,
		2023
		(pro forma)
Total revenue			388,241
Total costs of revenue			(311,640	)
Gross profit			76,601
Selling and distribution expenses			(2,264	)
General and administrative expenses			(19,642	)
Operating income/(loss)			54,695
Interest income			2,858
Interest expenses			(85,290	)
Loss on short-term investments			(2,185	)
Gain on extinguishment of debt			2,897
Debt restructuring income			149,499
Other (expenses)/income			(1,774	)
Exchange gain			17,975
Share of loss of equity investees			(7,846	)
Income/(loss) from operations before income taxes			130,829
Income tax (expenses)/benefits			(36,765	)
Net income			94,064
Net income/(loss) attributable to non-controlling interest			8,045
Net income/(loss) attributable to Xinyuan Real Estate Co., Ltd. shareholders			102,109
Income/(loss) per ADS:
Basic			18.95
Diluted			18.95
ADS used in computation:
Basic			5,388
Diluted			5,388

 

 

XINYUAN REAL ESTATE CO., LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(The pro forma financial statement after recording this debt restructuring)

(All US$ amounts and number of shares data in thousands)

 

		June 30,
		2023
		(pro forma)
ASSETS
Current assets
Cash and restricted cash			380,777
Short-term investments			9,304
Accounts receivable			12,004
Other receivables			372,267
Deposits for land use rights			31,340
Other deposits and prepayments			282,848
Advances to suppliers			48,024
Real estate properties development completed and under development			3,112,657
Amounts due from related parties			193,246
Amounts due from employees			4,140
Other current assets			13,987
Total current assets			4,460,594
Restricted cash, non-current			-
Real estate properties held for lease, net			341,954
Property and equipment, net			26,141
Long-term investment			82,605
Deferred tax assets			299,623
Deposits for land use rights and properties			31,830
Amounts due from related parties			12,135
Contract cost assets			64,880
Operating lease right-of-use assets			2,997
Other assets			54,642
TOTAL ASSETS			5,377,401

 

 

XINYUAN REAL ESTATE CO., LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(The pro forma financial statement after recording this debt restructuring)

(All US$ amounts and number of shares data in thousands)

 

		June 30,
		2023
		(pro forma)
LIABILITIES AND
SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and notes payable			954,951
Short-term bank loans and other debt			62,042
Customer deposits			927,284
Income tax payable			212,954
Other payables and accrued liabilities			563,511
Payroll and welfare payable			10,969
Current portion of long-term bank loans and other debt			1,144,807
Lease liability, current portion			2,032
Mandatorily redeemable non-controlling interests			10,217
Amounts due to related parties			73,320
Total current liabilities			3,962,087
Non-current liabilities
Long-term bank loans			337,699
Other long-term debt			358,672
Deferred tax liabilities			414,267
Unrecognized tax benefits			147,327
Lease liability			1,691
Amounts due to related parties			-
TOTAL LIABILITIES			5,221,743
Shareholders’ equity
Common shares			16
Treasury shares			(116,062	)
Additional paid-in capital			544,955
Statutory reserves			179,320
Retained earnings			(555,856	)
Accumulated other comprehensive loss			(37,804	)
Total Xinyuan Real Estate Co., Ltd. shareholders’ equity			14,569
Non-controlling interest			141,089
Total equity			155,658
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY			5,377,401

 

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