China Wantian Holdings Issues Major Profit Warning for FY2025: Sharply Higher Losses Expected

Key Highlights

• Substantial Widening of Net Loss: China Wantian Holdings Limited (“the Company”) expects to record a consolidated net loss of up to HK\$145 million for the year ended 31 December 2025. This marks a significant increase compared to the net loss of approximately HK\$42 million reported in the prior year (FY2024).
• Absence of One-Off Gains: The company did not book any other income relating to gains on disposal of subsidiaries during FY2025, which had benefited the prior period.
• Increased Operating Losses: Both the catering services segment in the Greater Bay Area and the food supply segment in Hong Kong experienced significant increases in operating losses.
• Asset Impairments and Depreciation: The company faced impairment losses on right-of-use assets and property, plant, and equipment within its catering services segment. Additionally, there was an increase in depreciation expenses following a 2024 leaseback agreement intended to support business expansion.

Details for Shareholders and Investors

The Board of Directors has issued this profit warning based on a preliminary review of the unaudited consolidated management accounts for FY2025. The following factors are identified as the main contributors to the sharp rise in losses:

1. No Gains from Subsidiary Disposals: The absence of other income, specifically gains from the disposal of subsidiaries, has negatively impacted year-on-year results.
2. Operating Loss Expansion: Both key segments—catering services in the Greater Bay Area and food supply in Hong Kong—saw their operating losses increase significantly.
3. Impairment Losses: The company is taking impairment charges on right-of-use assets and property, plant, and equipment in its catering services operations.
4. Rising Depreciation: The depreciation of property, plant, and equipment, as well as right-of-use assets, has increased. This is attributed to a leaseback agreement signed in 2024 to facilitate the expansion of the group’s food supply business in Hong Kong and catering services in the Greater Bay Area.

Potential Impact on Share Price

Investors should note that the expected loss for FY2025 is more than three times the loss reported in FY2024. The scale of this loss, combined with the absence of one-off gains and the negative impact from both increased operating losses and asset impairments, is likely to be viewed negatively by the market. This announcement is therefore considered highly price-sensitive.

The company has cautioned that the consolidated results for FY2025 are still subject to audit and may differ from the estimates provided. The final audited results are expected to be announced around 30 March 2026.

Shareholder Guidance

Shareholders and potential investors are strongly advised to review the full annual results when published, as the current information is based on unaudited preliminary figures and may be adjusted. Caution is recommended when dealing in the shares of China Wantian Holdings Limited, given the significant deterioration in financial performance.

Board Composition

The Board currently comprises Dr. Hooy Kok Wai and Mr. Zhong Xueyong as Executive Directors; and Ms. Chan Sze Man, Mr. Lam Chi Wing, and Mr. Hui Chun Kin Norman as Independent Non-Executive Directors.

Disclaimer: This article is based on a preliminary profit warning announcement by China Wantian Holdings Limited and may contain forward-looking statements subject to change. The information has not been audited. Investors should not rely solely on this article for investment decisions and are advised to exercise caution and consult the full audited results when released.

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