Town Ray Holdings Limited Issues Significant Profit Warning for FY2025

Key Points from the Announcement

• Profit Decline Expected: Town Ray Holdings Limited (Stock Code: 1692) has issued a profit warning, projecting a substantial decrease in net profit attributable to owners for the year ended 31 December 2025.
• Profit Range: The estimated net profit is between HK\$57.0 million and HK\$68.0 million, compared to HK\$107.6 million in the previous financial year.
• Percentage Decline: This represents a year-on-year decrease of approximately 37% to 47%.
• Main Causes: The Board attributes this decline primarily to:
  • Rising direct labour and material costs
  • Strategic shift towards competitively priced products to address customer price sensitivity and retain market share, resulting in reduced gross profit and margin
• Financial Results Not Finalised: The figures are based on consolidated management accounts and have not been audited or reviewed by the audit committee or the Company’s auditor. Adjustments may occur.
• Disclosure Timing: The final audited results for FY2025 are expected to be published in late March 2026.

Implications for Shareholders and Investors

• Price Sensitivity: The significant decrease in profitability is likely to be price sensitive and could adversely affect the share price.
• Market Strategy: The Company’s decision to offer more competitively priced products to retain market share indicates ongoing market challenges and customer price sensitivity. This may affect future earnings and growth prospects.
• Cost Pressure: The rise in direct labour and material costs reflects broader inflationary pressures or supply chain challenges, which may persist into the next financial periods.
• Uncertainty: Since the financial results are preliminary and unaudited, further adjustments are possible, increasing uncertainty for investors.
• Trading Caution: Shareholders and potential investors are strongly advised to exercise caution when dealing in the Company’s shares, pending the release of the final results.

Board Composition

The Board includes a mix of executive, non-executive, and independent non-executive directors, led by Chairman and non-executive Director Chan Kam Kwong Charles.

Next Steps

• The Company will release its audited annual results for FY2025 in late March 2026.
• Investors are encouraged to closely monitor updates and the final results announcement for further clarity.

Disclaimer

This article is based on preliminary unaudited financial information provided by Town Ray Holdings Limited. The actual results may differ from the estimates contained herein. Investors should exercise caution and seek professional advice before making investment decisions. The information does not constitute investment advice or a recommendation to buy or sell any securities.

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