Property investor Chinese Estates Holdings has posted a net loss of HK$378.83 million for last year, fuelled by substantial losses and provisions for its associate companies. Chaired by Thomas Lau Luen-hung, Chinese Estates was in the red after making a HK$331.08 million provision for advances to associates. It is believed some of the losses came from financially troubled property company Chi Cheung Investment, which Chinese Estates acquired in November through a HK$276 million debt-restructuring plan. Chinese Estates swapped some of its property assets, valued at HK$216 million, plus injecting HK$60 million cash in exchange for a 66.89 per cent stake in the debt-ridden firm. Chi Cheung said the debt-restructuring plan allowed it to eliminate about HK$819.7 million in outstanding debts, of which about 82.5 per cent, or HK$676.7 million, was converted into equity based on the proportion of indebtedness to each creditor. As a result of the scheme, Chi Cheung booked a gain of HK$542.01 million, helping it to a profit of HK$591.83 million for the year to December 31, against its HK$257.8 million loss in 1999. Notably, Chi Cheung recorded a turnover of just HK$5.15 million during the year, down from HK$108.36 million in 1999, as the company concentrated on restructuring its debt. Chinese Estates did not provide a clear breakdown of the provisions, only briefly stating that the provision for advances to associates mainly represented an impairment loss on development projects held by associates and loss on the disposal of property held by an associate. However, Chi Cheung said it had recorded an impairment loss of HK$23.28 million, recognised in respect of properties under development. Chi Cheung was close to being wound up by creditors after it posted a net loss of HK$1.28 billion in 1998. Chinese Estates emerged as a white knight in April last year. The company had a net liability of HK$733.7 million at the end of 1999. Chi Cheung had net assets of HK$182.5 million at the end of December. Chinese Estates also incurred substantial losses from devaluation of property projects in its associates and subsidiaries. In the company's financial review, Chinese Estates said it made provisions of HK$286.1 million for these projects. This was to reflect the adjustment of the value of property development projects held by associates and a subsidiary. In the previous year, Chinese Estates made a HK$138.23 million net profit on a HK$806.01 million turnover. Last year turnover dropped almost 20 per cent, year on year, to HK$649.69 million. Chinese Estates also shared HK$179.04 million in revaluation deficits on investment properties from its 26.76 per cent-owned property developer Kwong Sang Hong International and 46.6 per cent-controlled mainland property arm, Evergo China Holdings. Evergo China yesterday announced its net loss widened to HK$80.48 million for the year to December 31. Mr Lau, chairman of all three companies, said in the announcement that the widening of the Evergo China loss was the result of the disposal loss and provision for Winson Plaza, the property project it has in Tianjin. It earned a net HK$138.76 million in 1999. Evergo China's turnover rose 5.4 per cent to HK$35.32 million. While Kwong Sang Hong posted a net loss of HK$4.42 million for the year ended November 30, it was a significant improvement on the HK$735.46 million loss suffered in the previous year. Mr Lau and his brother Joseph Lau Luen-hung control 64.76 per cent of Chinese Estates. Directors of Chinese Estates, Chi Cheung and Evergo China did not declare any dividend payments for last year.