K. Wah International Holdings Issues Profit Warning for FY2025: Significant Loss Expected

K. Wah International Holdings Limited (Stock Code: 00173) has issued a profit warning, alerting shareholders and potential investors to a significant expected loss for the financial year ended 31 December 2025. This announcement, made in accordance with Hong Kong Listing Rules and the Securities and Futures Ordinance, is likely to have a material impact on the company’s share price.

Key Highlights of the Announcement

• Expected Loss for FY2025:
  • The company anticipates recording a loss attributable to equity holders of not more than HK\$900 million for the year ended 31 December 2025.
  • This contrasts sharply with the profit of HK\$335 million reported for the previous year ended 31 December 2024.
• Reasons for the Loss:
  • Impairment Provisions on Unsold Inventories: Non-cash provisions were made due to unsold inventories, reflecting challenging market conditions in the property sector.
  • Change in Fair Value of Investment Properties: The valuation of investment properties has declined.
  • Share of Losses from Joint Ventures: The group has absorbed losses from joint ventures facing negative project margins amid ongoing price pressure.

What Shareholders Must Know

• Nature of Impairment Provisions: The company clarified that the impairment provisions related to property development projects are non-cash items and will not impact the operating cash flow of the group.
• Financial Health & Gearing: Despite the anticipated loss, the company reports a stable net gearing ratio of below 20%. Liquidity remains strong and the overall financial position is described as healthy.
• Investment Strategy: Management emphasized that the company’s prudent investment strategy remains unchanged, with a continued focus on creating value for shareholders.

Additional Details and Timeline

• The information in the profit warning is based on a preliminary assessment of draft unaudited management accounts for FY2025. The accounts have not yet been reviewed or audited by the company’s auditors.
• The final audited results for FY2025 are expected to be published in late March 2026.
• The company urges shareholders and potential investors to exercise caution when dealing in the shares of K. Wah International Holdings Limited.

Board and Management

• Executive Directors: Mr. Francis Lui Yiu Tung (Chairman), Mrs. Paddy Tang Lui Wai Yu (Co-Managing Director), Mr. Alexander Lui Yiu Wah (Co-Managing Director)
• Non-executive Director: Dr. Moses Cheng Mo Chi
• Independent Non-executive Directors: Mr. Wong Kwai Lam, Mr. Nip Yun Wing, Mr. Cheung Kin Sang

For more details, visit the company website: www.kwih.com

Disclaimer: This article is based on the company’s official announcement and preliminary information, which has not been audited. Investors are strongly advised to exercise caution and seek professional financial advice before making any investment decisions. The information provided herein should not be construed as investment advice or a recommendation to buy or sell any securities.

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