Kwung’s Aroma Holdings Issues Significant Profit Warning for FY2025

Key Highlights

• Kwung’s Aroma Holdings Limited ("the Company") expects a sharp decline in net profit for the fiscal year ended 31 December 2025.
• Net profit is forecasted to fall by approximately 70%, from RMB 119 million in FY2024 to RMB 36 million in FY2025.
• The announcement was made in accordance with Hong Kong Stock Exchange listing rules and relevant inside information provisions.

Factors Contributing to the Profit Decline

1. Reduced Gross Profit:
   • Gross profit decreased by RMB 34.9 million.
   • Mainly due to fewer purchase orders processed for European customers.
   • This drop is believed to be caused by anti-dumping duties imposed by the European Union on imports of candle products originating from China.
2. Absence of One-Off Gain:
   • FY2024 saw a one-off gain of RMB 21.7 million from the disposal of a subsidiary, which did not recur in FY2025.
3. Higher Administrative Expenses:
   • Increased costs attributed to the launch of new production bases in Wuhu City, Anhui Province (China) and in Vietnam.
4. Foreign Exchange Impact:
   • Depreciation of the US Dollar against the Renminbi during FY2025 led to decreased revenue from overseas orders denominated in USD.

Important Shareholder Information

• This announcement is based on the Board’s preliminary assessment of unaudited consolidated financial information, not yet audited by external auditors.
• The final audited results may differ from figures disclosed in this announcement.
• The annual results announcement for FY2025 is expected to be published on 31 March 2026.
• Shareholders and investors are advised to exercise caution when dealing in the Company’s shares, given the substantial decrease in profitability and associated risks.
• This news is highly price sensitive and may trigger significant volatility in the share price, as a 70% drop in net profit could affect investor sentiment and valuation metrics.

Board and Directors

• Chairman and Executive Director: Mr. JIN Jianxin
• Executive Director: Mr. TIAN Dong
• Independent Non-Executive Directors: Mr. LAI Chun Yu, Ms. XU Qiong, Mr. ZHOU Kai

Conclusion

Kwung’s Aroma Holdings faces a challenging FY2025, with expectations of a substantial profit decline driven by external regulatory measures, non-recurring gains, operational expansions, and foreign exchange headwinds. These factors are likely to be material to share price performance in the near term. Investors are strongly encouraged to monitor the forthcoming audited results and to remain cautious when trading shares.

Disclaimer

This article is based on preliminary unaudited information and may not reflect the final audited results of Kwung’s Aroma Holdings Limited. The information provided is for general informational purposes only and is not investment advice. Investors should consult professional advisors and await the official audited financial statements before making any investment decisions.

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