Minsheng Education Group Issues Profit Warning for FY2025

Key Highlights of the Announcement

• Minsheng Education Group Company Limited expects to record a significant net loss for the year ended 31 December 2025, marking a major reversal from the previous year’s profitability.
• The anticipated net loss for FY2025 is projected to be not less than RMB210.0 million, compared to a net profit of approximately RMB187.8 million in FY2024 (excluding impairment losses of goodwill and intangible assets).
• This profit warning does not factor in potential financial impacts from ongoing arbitration proceedings or any additional impairment losses, which could further affect results.

Details and Reasons for the Expected Loss

1. Decline in Online Education Revenue:
   • The Group’s online education entities experienced a substantial decrease in revenue during FY2025, primarily due to adverse market conditions.
   • This revenue decline was significant enough to lead to a net loss for the online education segment, impacting the Group’s overall financial performance.
2. Increased Investment and Operating Costs:
   • The Group’s schools in China continued to ramp up investments in school operations during FY2025.
   • This resulted in a considerable increase in related operating costs compared to FY2024, further contributing to the overall net loss.

Shareholder Guidance and Potential Price Sensitivity

• This announcement is made in accordance with Hong Kong Listing Rules and the Inside Information Provisions, indicating it contains material information that could significantly affect the share price.
• The magnitude of the expected loss and the shift from profitability to loss are likely to be viewed negatively by the market, potentially impacting investor sentiment and the Group’s share price.
• Shareholders and potential investors are strongly advised to exercise caution when evaluating the Group’s financial position based on this preliminary and unaudited information.
• The actual results may be subject to amendments and adjustments, as the figures presented are based on unaudited management accounts and have not been reviewed by independent auditors or the audit committee.
• The Company will publish its audited annual results by the end of March 2026, which will provide more definitive information.
• The announcement also notes that further disclosures will be made if necessary, particularly if there are developments regarding arbitration or impairment losses.

Board and Management Details

• The announcement was signed by Chairman Li Xuechun and lists the current executive, non-executive, and independent non-executive directors, ensuring transparency regarding the leadership responsible for this update.

Conclusion

The profit warning issued by Minsheng Education Group represents a substantial change in the company’s financial outlook and is likely to be price-sensitive. Investors should closely monitor subsequent announcements and the upcoming audited annual results for further details, especially regarding unresolved arbitration matters and potential asset impairments.

Disclaimer: This article is based on preliminary unaudited management accounts and information disclosed by Minsheng Education Group. Actual results may differ from those presented. Investors should not solely rely on this information and are advised to review the official audited results and consult professional advisors before making investment decisions.

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