China Yurun Food Group Limited Issues Profit Warning for FY2025

Key Highlights for Investors

• Anticipated Loss: China Yurun Food Group Limited expects to record a net loss of approximately HK\$70 million for the year ended 31 December 2025, compared to a loss of around HK\$36 million in 2024.
• Significant Increase in Loss: The year-over-year increase in losses is substantial and may be considered price sensitive, as it could affect investor sentiment and the company’s share price.
• Absence of One-Off Gains: The main reason for the increased loss is the absence of one-off items recognized in 2024. Last year, the company benefited from a written-off of lease liabilities and a gain on extinguishment of debt totaling approximately HK\$117 million, which did not recur in 2025.
• Changes in Write-Offs and Impairments:
  • A decrease in the written-off value-added tax recoverable recognized for 2025 (approximately HK\$36 million).
  • A decrease in the written-off of property, plant, and equipment for 2025 (approximately HK\$21 million).
  • A decrease in impairment loss on property, plant, and equipment for 2025 (approximately HK\$32 million).
• Unaudited Figures: The loss figures disclosed are based on a preliminary review of the unaudited consolidated management accounts. The financial statements are still being finalized and have not yet been audited or reviewed by the company’s independent auditors or audit committee.
• Upcoming Results Announcement: The audited annual results are expected to be released by the end of March 2026.
• Board Statement: The Board advises shareholders and potential investors to exercise caution when dealing in the securities of the company.

Details Investors Need to Know

The anticipated loss for FY2025 represents a near doubling of the previous year’s loss, primarily due to the absence of significant one-off gains that benefited the company in 2024. The one-off written-off of lease liabilities and gain on extinguishment of debt (~HK\$117 million) had a positive impact last year but is not expected to recur, significantly affecting the bottom line for 2025.

While there are decreases in write-offs and impairment losses this year, these positive effects are not enough to offset the impact of missing one-off gains. The company’s financial position may be perceived as weakening, which is an important consideration for both existing shareholders and potential investors.

The Board emphasizes that these numbers are preliminary and unaudited. The final, audited results will be published by the end of March 2026. Investors should be alert to the possibility of further adjustments or disclosures that could affect the company’s valuation.

Potential Impact on Share Price

The sharp increase in net losses and the absence of extraordinary income items from the previous year are likely to be viewed negatively by the market. This profit warning is a material event and could result in downward pressure on the share price. Shareholders should closely monitor future disclosures, as further negative surprises or adjustments in the audited results could exacerbate this impact.

Board and Management

As of the announcement date, the Board consists of Executive Directors Zhu Yuan (Chairman) and Yang Linwei, and Independent Non-Executive Directors Gao Hui, Chen Jianguo, and Xu Xinglian.

Disclaimer

Disclaimer: This article is based on preliminary, unaudited information provided by China Yurun Food Group Limited. The final audited results may differ from the figures discussed above. Investors should exercise caution and seek independent advice before making any investment decisions related to the company. The information herein does not constitute investment advice.

View YURUN FOOD Historical chart here