Rongta Technology (Xiamen) Group Co., Ltd. Issues Profit Warning for FY2025

Key Highlights and Details for Shareholders and Investors

Rongta Technology (Xiamen) Group Co., Ltd. (Stock Code: 9881) has released a significant profit warning for the financial year ended 31 December 2025. The company expects a substantial decline in net profit compared to the previous year, which could have a material impact on its share price.

Key Points from the Announcement

• Expected Net Profit for 2025: The company anticipates recording a net profit of not less than approximately RMB 3.0 million for the year ended 31 December 2025. This represents a dramatic decrease from the net profit of approximately RMB 41.3 million reported for the year ended 31 December 2024.
• Reasons for Profit Decline:
  • Decrease in Revenue:
    • Delays in local government implementation of policies, resulting in reduced immediate demand for certain products.
    • Delays, changes, or reductions in procurement plans from some customers. These were caused by further enhancements requested by customers on product specifications before delivery, additional product testing, or discontinuation of certain product lines.
  • Increase in Expenses:
    • General and administrative expenses rose, mainly due to one-off, non-recurring listing expenses related to the company’s H share listing on the Hong Kong Stock Exchange in June 2025.
    • Staff costs increased, driven by higher headcount and payroll compared to the previous year.
    • There was also a rise in selling and marketing expenses, primarily associated with greater e-commerce activities.
• Potential Civil Complaint Impact:
  • The company referenced prior announcements (3 July 2025, 25 July 2025, and 20 October 2025) regarding a civil complaint. As of this profit warning, the potential financial impact of the complaint on audited results is still under assessment and may affect the net profit for the period. There have been no material developments since the last announcement.

Important Information and Risks for Shareholders

• Share Price Sensitivity:
  • This sharp profit decline is a major price-sensitive event. Investors should expect increased volatility and monitor further updates, especially regarding the outcome of the civil complaint and final audited results.
• Preliminary Nature of the Results:
  • The information provided is based on unaudited consolidated management accounts and the board’s preliminary review. It has not been audited or reviewed by the company’s audit committee or external auditors and is subject to further adjustments.
  • Final audited results for the period are expected to be published in late March 2026.
• Guidance for Investors:
  • Shareholders and potential investors are advised not to rely solely on this preliminary announcement and to exercise caution when dealing in the company’s securities until the audited results are released.

Management and Board Information

• Board Composition:
  • Chairman and Executive Director: Xu Kaiming
  • Executive Directors: Xu Kaiming, Lin Yanqin, Fu Jianfang
  • Employee Representative Director: Chai Ling
  • Independent Non-Executive Directors: Dr. Lim Kim Huat, Dr. Huang Liqin, Dr. Lai Shaojuan

Disclaimer: The information above is provided for reference only, based on the company’s preliminary profit warning announcement. It is not audited or finalized, and investors should consult the official audited annual results, expected in March 2026, and seek independent advice before making investment decisions. The article does not constitute financial advice.

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