First Shanghai Investments Issues Profit Warning for FY2025

First Shanghai Investments Limited (Stock Code: 227) has issued a significant profit warning, notifying shareholders and investors of a major turnaround in its financial performance for the year ended 31 December 2025.

Key Points from the Announcement

• Expected Net Loss: The Group anticipates recording a net loss attributable to shareholders of not less than HK\$90 million for the year ended 31 December 2025. This is a dramatic reversal from the net profit of approximately HK\$78 million reported for the previous year (2024).
• Turnaround Drivers:
  • One-off Net Gain Absence: The loss is primarily due to the absence of a one-off net gain on the disposal of subsidiaries, which contributed around HK\$65 million to profits in 2024 but will not recur in 2025.
  • Impairment and Fair Value Adjustments: There are significant impairment and fair value adjustments on certain non-current assets within the property investment and hotel segment.
  • Unrealized Fair Value Losses: The Group has recognized unrealized fair value losses on financial assets, further contributing to the negative result.
• Results Not Yet Final: The figures provided are based on preliminary, unaudited management accounts and have not been reviewed or audited by the Company’s auditor, nor reviewed by the audit committee.
• Final Results Announcement: Shareholders and investors should expect the final results for the year ended 31 December 2025 to be published before the end of March 2026.

Key Considerations for Shareholders

• Share Price Sensitivity: The anticipated swing from profit to a substantial loss is highly price sensitive and could have a notable impact on the Company’s share price.
• Absence of Non-recurring Gains: Investors should note that the positive results in 2024 were boosted by a one-off disposal gain, which will not reoccur in 2025, reflecting a less robust underlying business performance.
• Asset Valuations: Impairments and fair value losses indicate potential challenges in the value and performance of the Company’s property investment and hotel assets, as well as its financial assets portfolio.
• Caution Advised: The Company explicitly advises shareholders and potential investors to exercise caution when dealing in the shares due to the uncertainties around the finalized results.

Additional Information

• The Board is composed of four executive directors, one non-executive director, and four independent non-executive directors.
• This announcement was authorized and signed by Chairman Lo Yuen Yat.

Conclusion

The profit warning marks a material change in the Company’s earnings outlook and reflects several underlying challenges. Investors are urged to monitor the forthcoming annual results announcement and reassess their positions accordingly.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Shareholders and potential investors should consider all available information and consult with their financial advisers before making any investment decisions. The final audited results may differ from the preliminary figures discussed above.

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