Concord New Energy Issues Major Profit Warning; Shareholders Alerted to Significant Downturn

Key Highlights from Concord New Energy’s Profit Warning

• Substantial Profit Decline: Concord New Energy Group Limited has announced that it expects to record a decrease of over 80% in unaudited profit attributable to equity holders for the year ended 31 December 2025, compared to the previous year’s profit of approximately RMB800 million.
• Operational Cash Flow Improvement: Despite the dramatic profit drop, the company reports a year-on-year increase in cash generated from operating activities during the reporting period.
• Multiple Negative Factors Impacting Profit:
  • Revenue & Margin Decline: Lower-than-expected wind and solar resources, increased curtailment rates, and grid limitations in Mainland China led to reduced electricity sales volumes.
  • Market Pressure: Intensified competition in market-based electricity trading pushed down the average comprehensive electricity price.
  • Subsidy Reversal: A one-off reversal of previously recognized renewable energy subsidy revenue was triggered by clarified regulatory guidance in China.
  • Asset Losses & Impairments: Losses were incurred on certain financial assets measured at fair value, and impairments recognized on long-term equity investments due to changes in industry and market value.
  • Tax Impact: The prior year’s results were boosted by a significant non-recurring gain from a tax refund and reversal of withholding tax, associated with regaining Hong Kong tax residency status. No such gain was recorded in 2025.
• Cost Control and Strategic Actions:
  • The group implemented workforce and cost optimization measures, reducing full-time employees by over 30% compared to the end of 2024.
  • Enhanced operational efficiency and equipment availability.
  • Advanced project development, including signing long-term Power Purchase Agreements (PPAs) with global enterprises in the United States for photovoltaic projects.
  • Formed an equity fund with major Chinese insurance capital and expanded service business channels.
  • Successfully completed a secondary listing in Singapore, broadening international financing and business expansion opportunities.
• Ongoing Uncertainties:
  • The profit warning is based on unaudited management accounts; the audited results may differ.
  • The final annual results are expected to be published by the end of March 2026.
• Management and Governance: The board comprises a mix of executive, non-executive, and independent non-executive directors, led by Chairman Liu Shunxing.

Shareholder Guidance and Potential Price Sensitivity

This profit warning is highly price sensitive and is likely to have a significant impact on Concord New Energy’s share price. The anticipated >80% decline in profit is material, especially as it follows a period of substantial profitability. The combination of operational, regulatory, and market pressures, as well as one-off negative adjustments, present a challenging outlook for near-term earnings.

Furthermore, while the company has taken steps to improve operational efficiency and internationalize its business, these measures have yet to offset the negative impacts seen in core profit drivers. Investors should closely monitor the company’s official full annual results in March 2026 for any changes or additional disclosures.

Shareholders and potential investors are strongly advised to exercise caution when dealing in the shares of the Company in light of these developments.

Company Background

Concord New Energy Group Limited, headquartered in Singapore, is principally engaged in the global investment and operation of wind power, solar power, and energy storage projects, as well as the provision of technical services and integrated solutions.

Disclaimer: This article is a summary and interpretation of Concord New Energy Group Limited’s official profit warning announcement. It is intended for informational purposes only and does not constitute investment advice. Investors are advised to review the full annual results announcement when available and consult their financial advisors before making investment decisions. The information is based on management’s preliminary unaudited assessment and may be subject to change.

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