Some of the top executives of embattled Chinese property developer Country Garden Holdings are taking a pay cut for the third time since early 2022 as the company focuses on delivering pre-sold properties and preventing further defaults on its debts amid stagnant home sales.
The company’s executive directors Yang Huiyan, Mo Bin, and Yang Ziying have “voluntarily requested” to reduce their annual pay to 120,000 yuan (US$16,716.80) from 370,000 yuan, 3 million yuan, and 2 million yuan, respectively, according to a statement issued late Tuesday.
Yang Huiyan, who is the chairman of Country Garden and the daughter of its founder, Yang Guoqiang, is currently the largest shareholder, with a 52 per cent stake. Chen Chong, who is a non-executive director and Yang Huiyan’s husband, will also see his pay reduced to 120,000 yuan from 370,000 yuan.
Over the past two years, the company has adjusted the pay of its top executives “multiple times”, leading to an 86 per cent overall drop in their remuneration compared to 2021 levels, a spokesperson said. Mo’s annual pay before the most recent cut in September 2022 was 15 million yuan, and Yang Ziying’s was 10 million yuan.
“Ensuring the delivery [of pre-sold properties] is Country Garden’s most important corporate responsibility, as well as the ‘bottom line’ of the safety of the property market,” said a spokesperson.
Among “self-support measures” to cut costs and overcome its cash crunch, top executives will also lose some perquisites, including free cars and access to dining halls, as well as physical exam refunds, the spokesperson said.
Country Garden is also reducing the floor area of its offices, and has cut administrative costs by close to 60 per cent in 2023, compared to 2021 levels, the spokesperson said.
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In the first 11 months of 2023, Country Garden has delivered more than 500,000 houses across 240 cities in 31 provinces, the company said.
The developer, once China’s biggest in terms of sales, appears likely to avoid a default on 800 million yuan worth of onshore bonds. At a meeting last week at the Shenzhen Stock Exchange, most investors in Country Garden’s local notes agreed not to exercise a put option expiring on Wednesday that allows investors to demand repayment before maturity next year.
Country Garden has not responded to the Post’s request for comments.
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The company still faces many challenges. Last month, it posted total contracted sales of 6.31 billion yuan for October, only 2 per cent higher than its lowest point in September, according to its exchange filing.