(Yicai Global) May 6 -- Shares in Suning.com plummeted by the exchange-imposed limit today, the first day of trading this week, after the struggling Chinese retailer reported an almost eight-fold widening of its losses last year from 2019 to CNY44.6 billion (USD6.6 billion).

Suning’s share price [SHE:002024] closed 4.95 percent lower at CNY3.07 (USD0.46). The stock markets were closed for a public holiday from May 2 to May 4 and the company suspended trading yesterday ahead of the release of its financial report but reopened today.

More than half of last year’s losses were due to poor investments, the Nanjing-based company said in its latest earnings report released yesterday. The firm is in danger of being delisted from the Shenzhen Stock Exchange as it has now been in the red for three straight years.

And the outlook does not look promising. In the first quarter, the company’s losses were CNY1 billion (USD149.7 million), compared with net profit of CNY456.2 million (USD68.3 million) the same period last year. Revenue plunged 64 percent to CNY19.4 billion (USD2.9 billion).

Suning had overdue debts of CNY32.9 billion (USD4.9 billion) as of the end of last year, so there are uncertainties regarding its ability to maintain sustainable operations, audit agency PricewaterhouseCoopers Zhong Tian said earlier.

Suning will continue to control costs and take action to improve cash flow, the Nanjing-based retailer said. The firm is also making great efforts to resume partnerships with its suppliers and partners and is seeking solutions to pay off its debts, such as negotiating payment in installments, to ease pressure on working capital and liquidity.

Suning's financial crisis is largely due to overaggressive expansion – the firm bought an 80 percent stake in hypermarket chain Carrefour China in September 2019 – and the fallout from the Covid-19 pandemic which greatly reduced footfall to its brick-and-mortar outlets. Last July it was part of a government-led bail out, selling a 17 percent stake for CNY8.8 billion (USD1.4 billion).

Editor: Kim Taylor