Key Highlights from the Announcement

• Substantial Profit Surge: Tanwan Inc. anticipates a remarkable increase in net profit for the year ended December 31, 2025. The Group expects to post a net profit of not less than RMB1,500 million, a dramatic rise compared to the net profit of RMB44.0 million recorded for the same period in 2024.
• Major Drivers Behind Earnings Growth:
  • Fair Value Gains on Financial Assets: A significant portion of the profit growth stems from fair value gains on financial assets at fair value through profit or loss, particularly linked to shares of other listed companies held by the Group.
  • Expansion in Overseas Game Publishing: The Group achieved increased revenue from its overseas game publishing business, which also contributed higher operating profit margins.
  • Reduced Selling and Distribution Expenses: Several factors contributed to decreasing marketing costs:
    • Application of AI technology in game distribution operations and optimization of placement model algorithms.
    • Ongoing optimization and refinement of reserve game products, which had not yet been promoted on a large scale.
    • Lower user acquisition costs, partly due to the brand effect as certain game product portfolios entered a mature phase.

    These factors collectively lowered marketing expense ratios and drove stronger profit growth in the game business segment.

  • Offsetting Factors: The profit surge was partially offset by impairment losses on certain historical game royalty fees.

Important Information for Shareholders and Potential Investors

• Significant Upside in Profitability: The expected year-on-year profit growth is extraordinary and may be highly price sensitive. Such a sharp rise in profitability, especially from diversified income streams and improved efficiency, could positively impact the Company’s share value.
• Reliance on Preliminary Results: The numbers disclosed are based on preliminary unaudited consolidated management accounts and other currently available information. These results are subject to finalization, potential adjustments, and have not yet been reviewed or audited by the Company’s auditor or audit committee.
• Potential for Volatility: Investors should note that actual results may differ from the figures released in this alert, and are strongly advised to exercise caution when dealing in the shares of Tanwan Inc.
• Leadership and Governance: The Board is led by Mr. WU Xubo (Chairman and Executive Director) and includes Ms. WU Xuan (Executive Director), as well as three independent non-executive Directors: Ms. SONG Siyun, Mr. QIN Yongde, and Ms. ZHENG Yi.

Potential Share Price Impact

The dramatic improvement in expected profitability, driven by both core operational efficiency and financial asset appreciation, is a highly material development. Investors should anticipate that the market may react strongly to this positive profit alert, especially given the significant scale of the forecasted profit increase. The Company’s ability to leverage AI technology for cost savings, effective overseas market expansion, and capital gains from equity holdings are strategic advantages that position Tanwan Inc. for continued growth.

Disclaimer

The information in this article is based on the Company’s preliminary announcement and has not been reviewed or audited by external auditors. Actual results may differ from those disclosed. Investors are strongly advised to exercise caution and consult with professional advisers before making any investment decisions based on this information.

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