China Star Entertainment Issues Substantial Profit Warning for FY2025

Key Highlights

• Significant Increase in Losses: China Star Entertainment Limited has issued a profit warning, alerting shareholders and investors that the Group expects to record a substantial loss attributable to owners of the Company between HK\$400 million and HK\$480 million for the year ended 31 December 2025. This marks a notable increase compared to the loss of HK\$351.9 million for the year ended 31 December 2024.
• Main Reason for the Losses: The primary driver of this increased loss is a significant write-down of the Group’s stock of properties, totaling approximately HK\$308 million in 2025. This compares to a write-down of just HK\$28.5 million in 2024. The substantial write-down is mainly attributed to downward property price adjustments in Macau.
• Ongoing Finalization of Results: The Group’s financial results for the year ended 31 December 2025 have not yet been finalized. The figures disclosed are based on a preliminary review of unaudited consolidated management accounts and have not been confirmed by the Company’s independent external auditors. The final results are expected to be published on 30 March 2026.
• Regulatory Compliance: This announcement is made in accordance with Rule 13.09(2) of the Hong Kong Listing Rules and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance.

Price-Sensitive Information for Shareholders

• Potential Impact on Share Price: The profit warning signals a sharp deterioration in the Group’s financial performance, primarily due to the property market downturn in Macau. Such news is highly price-sensitive and could lead to increased volatility or a negative re-rating of China Star Entertainment’s share price.
• Advisory to Shareholders and Investors: With the expectation of a wider net loss and significantly higher property write-downs, shareholders and potential investors are explicitly advised to exercise caution when dealing in the Company’s shares.

Detailed Financial Outlook

According to the announcement, the Board of Directors expects the loss attributable to owners for FY2025 to be in the range of HK\$400 million to HK\$480 million, which is a considerable increase over the prior year’s loss of HK\$351.9 million. This leap in losses is primarily driven by a tenfold increase in the write-down of the Group’s property stock, a direct consequence of the continued decline in property prices in Macau.

For context, the write-down of stock of properties for 2025 is estimated at HK\$308 million, compared to HK\$28.5 million in 2024. This drastic adjustment underscores the adverse market conditions facing Macau’s property sector and its direct impact on the Group’s financial health.

The Company underscores that these figures are preliminary and unaudited, and investors should anticipate the release of the audited results on 30 March 2026. There may be further adjustments once the audit process is completed.

Corporate Governance

The announcement is authorized by the Board of China Star Entertainment Limited, led by Chairman Heung Wah Keung. As of the date of the announcement (26 March 2026), the Board comprises three executive directors and three independent non-executive directors, ensuring proper governance and oversight during this challenging financial period.

Conclusion

The sharp increase in expected losses and property write-downs represents a material development for China Star Entertainment Limited. Given the scale of the anticipated loss and its root cause in Macau’s property downturn, this news is highly price-sensitive and could materially affect the Company’s share price upon market reaction.

Shareholders and investors are strongly advised to exercise caution when transacting in the Company’s shares and to closely monitor future announcements for any updates regarding the final audited results.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult professional advisers before making any investment decisions. The financial figures discussed herein are based on unaudited preliminary management accounts and may be subject to further changes.

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