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Through continued efforts to optimize the capital and asset base, Fosun’s short-term liquidity pressure has been significantly eased and its credit rating outlook has been upgraded by an international rating agency.

HONG KONG, May 31, 2023 /PRNewswire/ — International rating agency S&P Global Ratings has released a report holding the rating outlook for Fosun International Limited (HKEX stock code: 00656, Fosun International) stable.

S&P Global Ratings noted in the report that, benefiting from the diversified asset portfolio and management’s commitment and execution to deleveraging through asset disposals, the asset disposals of Fosun generated a cash inflow of approximately RMB 30.0 billion in 2022. At the same time, sound banking relationships ensured sufficient sources of liquidity in a turbulent bond market environment. Significant asset disposals and stable credit support from banks have enabled Fosun to successfully repay all bonds that fell due over the past three quarters. At the end of March 2023, Fosun successfully reduced the debt of the holding company to RMB 24.0 billion. The total interest-bearing liabilities of the Fosun Group fell to RMB 93 billion. In addition, the share of bank loans in the holding company’s debt has increased, the share of debt falling due over the next 12 months has decreased significantly and the stability of debt has improved significantly. S&P Global Ratings affirmed its issuer long-term credit rating and the secured rating of the senior unsecured notes on Fosun, changing Fosun’s rating outlook to stable from negative.

Despite the uncertain external environment, Fosun’s onshore and offshore financing capabilities have been proven by the markets.

At the beginning of May this year, Fosun International’s offshore multi-currency syndicated loan was officially launched and secured a loan of over US$450 million equivalent so far. The offshore syndicated loan was jointly initiated by seven banks, including Bank of China, Bank of east asiaCommerzbank, Hang Seng Bank, HSBC, Natixis Bank and Standard Chartered Bank as lead bookrunners, and more than 10 banks have joined the syndicate.

In January this year, Fosun’s national operating entity, Shanghai Fosun High Technology (Group) Co., Ltd. secured a syndicated loan of RMB 12.0 billion. The syndicate was formed by five major state-owned commercial banks: Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank and Bank of Communications as lead banks, and China Minsheng BankExport-Import Bank of China and Shanghai Pudong Development Bank as participating banks.

Domestic and foreign banks have successively provided strong credit support to Fosun, reflecting traditional financial institutions’ recognition of Fosun’s debt management actions, such as accelerating the sale of non-core assets and fund entry. The strong financial support from the banks will also help Fosun reduce its reliance on public market funding and support further liquidity management and sustainable business development.

In a difficult global financial environment, Fosun’s credit indicators assigned by international institutions such as S&P Global Ratings are still holding up thanks to its resolute implementation of the

rationalization of the organization. By continuously optimizing the structure of assets and liabilities and increasing the disposal of non-strategic and non-strategic assets, Fosun’s internal dynamic to overcome market cycles and achieve sustainable development has been further strengthened. For the full year of 2022, the amount per contractual value based on the consideration set forth in the divestiture agreements exceeded RMB 40.0 billion, bringing cash inflow of nearly RMB 30.0 billion to the of the holding company.

Fosun’s series of “organization streamlining” measures have also built up momentum for the resumption of core business in the household consumption sector. In the first quarter of this year, Fosun’s consumer and tourism businesses showed a remarkable upward trend. In the first quarter, Yuyuan achieved operating income of RMB 15.244 billion, representing a year-on-year growth of 22.61%; Yuyuan Jewelry and Fashion’s revenue reached RMB 11.494 billion, an increase of 28.55% year-on-year. Coupled with the overall easing of travel restrictions around the world, Fosun Tourism Group’s (FTG) profit attributable to the parent company in the first quarter doubled compared to the same period in 2022, Club Med’s business volume reached 5,004 billion RMB, an increase of about 44.2%; during the May 1 holiday this year, the total business volume of Club Med resorts in China exceeded approximately eight times the same period in 2022 and exceeded the same period in 2019 by around 110%.

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