Key Highlights

• Profit Warning: The company expects to record a substantial loss attributable to shareholders, estimated between RMB370 million and RMB390 million for the year ended 31 December 2025 (FY2025).
• Contrast with FY2024: In FY2024, the Group reported a profit attributable to shareholders of approximately RMB242 million, marking a dramatic reversal in financial performance.
• Loss for the Year: The Group’s overall loss for FY2025 is anticipated to be between RMB280 million and RMB320 million. The difference between this figure and the loss attributable to shareholders is primarily due to differing commencement dates of ownership in various businesses.

Factors Leading to Expected Loss

Shareholders should note that the Board attributes this expected loss to several specific, largely non-recurring and non-cash factors:

• Acquisition-Related Costs and Finance Expenses: The Group completed the acquisition of the global surface solutions business of Merck KGaA on 31 July 2025. This acquisition resulted in:
  • One-off transaction costs and professional fees totaling approximately RMB220 million.
  • Fair value adjustments and intangible asset amortization amounting to RMB180 million.
• Business Integration Expenses: The Group incurred about RMB140 million in integration expenses, including transitional service agreement fees paid to Merck and other spin-off related costs.

Most of these expenses are either non-cash (such as amortization of intangible assets) or one-off in nature, and have had no material adverse impact on the Group’s operating cash flows or daily operations.

Revenue Growth Amid Losses

• Despite the significant drop in profitability, the Group recorded total revenue of approximately RMB2.8 billion to RMB3.0 billion for FY2025, representing a robust increase of about 72% to 80% compared to FY2024.
• The Group is expected to post positive EBITDA (earnings before interest, tax, depreciation, and amortization) for FY2025, demonstrating underlying operational strength.

Strategic Initiatives and Outlook

In response to recent challenges and as part of its ongoing growth strategy, the Group has undertaken several initiatives:

• Deepening global integration and unlocking synergies across business segments, including channel synergy and cross-selling.
• Optimizing capital structure and enhancing financial resilience to address market risks and uncertainties.
• Consolidating technological advantages in production and expanding scale to improve cost competitiveness.
• Expanding global market share, optimizing customer structure, and attracting more high-quality clients to increase market share and brand influence.

Important Shareholder Information

This announcement is a preliminary assessment based on unaudited management accounts, and the figures may be subject to further adjustments. The Group’s audited results for FY2025, with comparative figures for FY2024, are expected to be released by the end of March 2026.

Shareholders and prospective investors are advised to exercise caution when dealing in the Company’s shares.

Potential Share Price Impact

This profit warning represents a material, price-sensitive event. The shift from a significant profit in FY2024 to a substantial loss in FY2025, driven by acquisition-related and integration costs, is expected to influence investor sentiment and could impact the share price. However, the strong revenue growth and positive EBITDA signal underlying operational resilience, which may help stabilize long-term outlook if strategic initiatives bear fruit.

Disclaimer: This article is based on unaudited preliminary financial information provided by Global New Material International Holdings Limited. Investors should await the publication of audited results and consult their own financial advisors before making investment decisions. The information herein does not constitute investment advice.

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