Embattled bad-debt manager China Huarong Asset Management announced a return to profit in 2021 after a reorganization of its business and receiving a $6.6 billion government-organized bailout, reports Caixin. The state-owned firm reported a preliminary net income of RMB 370 million ($58 million) for 2021, compared with a record loss of RMB 102.9 billion a year earlier, according to an exchange filing Monday. Huarong is scheduled to release audited full-year results next week.
The Beijing-based company said its proactive adjustment of business strategy and accelerated cash recovery helped boost revenue last year, while significant losses from fair value changes in its legacy assets and credit impairment losses were already booked in 2020.
The company’s stock has slumped more than 60% since it resumed trading in early January, and investors remained jittery and divided over the industry’s long-term growth prospects.