Founder Holdings Limited Issues Profit Warning: Key Details for Investors

Summary of Announcement

Founder Holdings Limited (Stock Code: 00418) has issued a profit warning for the fiscal year ended 31 December 2025. The Board of Directors has disclosed that, based on preliminary unaudited management accounts and currently available information, the Group expects to record a profit attributable to owners of the Company of not more than approximately HK\$35 million for 2025. This represents a significant decrease compared to the profit of approximately HK\$47.9 million reported for the year ended 31 December 2024.

Key Points for Investors

• Profit Decline: Expected profit for 2025 is down by over 27% compared to 2024. This is a substantial decrease and could impact investor sentiment and share price performance.
• Reasons for Decline:
  • Decrease in Revenue: The company attributes the decline to reduced market demand stemming from the ongoing economic downturn.
  • Decrease in Other Revenue and Gains: Lower revenue-related government grants have further impacted profitability.
  • Loss on Disposal of Subsidiaries: There was a loss incurred from disposing of certain subsidiaries. This transaction did not constitute a notifiable transaction under Chapter 14 of the Hong Kong Listing Rules.
  • Increase in Income Tax Expenses: Higher tax expenses were incurred due to the implementation of Pillar Two of BEPS 2.0, a global initiative aimed at ensuring minimum corporate tax rates.
• Financial Statement Status: The financial results are not yet finalized. The disclosed figures are based on preliminary unaudited accounts and have not been audited or reviewed by the Company’s auditor.
• Annual Results Announcement: Detailed audited figures and financial performance will be published in the annual results announcement expected by the end of March 2026.
• Board Composition: The Board is chaired by Mr. Zhang Jian Guo, with a mix of executive and independent non-executive directors.

Potential Price Sensitive Information

This announcement is likely to be price sensitive for Founder Holdings Limited shareholders and potential investors due to:

• Significant Profit Decline: A reduction in profit of this magnitude could potentially lead to a negative market reaction and downward pressure on the share price.
• Underlying Causes: The combination of decreased revenue, losses on subsidiary disposals, and higher tax expenses signals that challenges in both operations and external factors (such as macroeconomic conditions and regulatory changes) are impacting the company.
• Uncertainty: As the figures are unaudited and the final results are pending, there is an element of uncertainty regarding the full extent of profit change, which could further affect investor confidence.

Shareholders and investors are advised to exercise caution when dealing in the securities of the Company.

Next Steps

Investors should closely monitor the upcoming annual results announcement, which will provide more detailed, audited information regarding the company’s financial performance for the year ended 31 December 2025.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors are urged to review the official annual results announcement and consult their financial advisors before making any investment decisions related to Founder Holdings Limited.

View FOUNDER HOLD Historical chart here