By Andrew Galbraith

SHANGHAI (Reuters) -Chinese state-owned asset manager China Huarong Asset Management sought on Monday to turn the page on a deep annual loss, as its chairman said it was in talks with potential new strategic investors alongside a CITIC-led consortium.

Wang Zhanfeng, on an earnings call a day after releasing results, said many investors continue to have faith in Huarong, and that it was speaking with potential new domestic and foreign strategic investors.

On Sunday, Huarong announced a first-half 2021 profit of 158.3 million yuan ($24.5 million) and a nearly $16 billion loss for 2020. Its annual results statement had been delayed by nearly five months because of restructuring uncertainties.

Earlier this month, the indebted company informed investors of a state-backed rescue plan led by the CITIC Group Corp.

That deal would make Huarong a subsidiary of CITIC Group, part of a plan by regulators to fold financially shaky state asset managers into financial holding groups, according to two sources familiar with the restructuring process.

Huarong is one of four state distressed debt managers and counts China’s finance ministry as its largest shareholder.

“We need to turn from quick profits, to long-term profits, to hard-earned profits,” Liang Qiang, executive director of Huarong, said on the call, alluding to the company’s rapid expansion under its former chairman Lai Xiaomin.

Lai was executed in January following one of China’s highest-profile corruption cases.

Huarong executives emphasised what they said was a more stable outlook for the company focused on its core business. They said the company’s offshore unit, Huarong International, would remain a strategic platform, and they believed it would continue to improve its asset structure and that its financial indicators would recover.

In its half-year report, China Huarong listed liabilities totalling 1.54 trillion yuan, including 107.5 billion yuan in bond payables falling due within one year, and 577.9 billion yuan in borrowings falling due within one year. It said certain regulatory indicators including its capital adequacy ratio and leverage ratio failed to reach minimum regulatory requirements.

On Monday, Huarong executives said the company would decide whether to roll out a refinancing plan for dollar-denominated debt based on its credit recovery process, its operational and developmental needs, as well as regulatory approval.

A decision on whether to buy back outstanding perpetual bonds would also be based on the operational situation of subsidiary China Huarong International Holdings Ltd as well as contracts and deals made with creditors, they said.

The mid-price on 4% perpetual bonds issued by subsidiary Huarong Finance 2017 Co Ltd rose about 1 cent to 94.781 following the call, according to data from Duration Finance, compared with a low of below 53 cents in May.

($1 = 6.4667 yuan)

(Reporting by Andrew Galbraith and Cheng Leng in Shanghai; Additional reporting by Julie Zhu in Hong Kong; Editing by Kim Coghill and Jacqueline Wong)