Impression Dahongpao Co., Ltd. Issues Profit Warning for FY2025

Key Points from the Report

• Impression Dahongpao Co., Ltd. (Stock Code: 2695) has issued a profit warning for the financial year ended 31 December 2025 (FY2025).
• The company expects to report a net profit attributable to shareholders of approximately RMB35.39 million for FY2025.
• This represents a significant decrease of about 21.8% compared to the net profit for FY2024.
• The anticipated decline in net profit is primarily due to substantial upfront investments related to the launch of a new business segment: a cultural tourism performance project named “Moonlight over Mount Wuyi”.
• The group’s operating incomes increased in FY2025, driven by new revenue streams from the aforementioned project, but overall costs and expenses outpaced income growth, resulting in a lower net profit.

Details on Business Expansion and New Revenue Channel

• In September 2024, the company made a strategic investment in the “Moonlight over Mount Wuyi” cultural tourism project, which officially premiered in May 2025.
• From 1 May to 31 December 2025, the project staged approximately 380 performances, attracting about 91,700 spectators and generating around RMB11.81 million in revenue.
• The initiative is part of Impression Dahongpao’s broader strategy to optimize its business structure, expand profit channels, and lay the foundation for sustainable development.
• While the project contributed positively to the group’s top line, the operational characteristics of the performing arts industry—significant upfront investments in production, venue construction, team formation, and marketing—led to sharp increases in operating costs and other expenses.
• As a result, the costs and expenses associated with the new business outpaced revenue gains, directly impacting profitability for the year.

Important Information for Shareholders

• The information provided in the profit warning is based on a preliminary review of unaudited management accounts for FY2025 and is subject to change.
• The financial data has not been confirmed, reviewed, or audited by the company’s auditors nor the audit committee and may be adjusted in the final annual results.
• Shareholders and potential investors are advised to exercise caution when dealing in the company’s shares and to read the forthcoming annual results announcement for FY2025, which is scheduled for publication by the end of March 2026.

Potential Impact on Share Price

The expected significant decrease in net profit for FY2025, despite new revenue streams, is a potentially price-sensitive event. The market may react negatively to the sharp fall in profitability, especially given the substantial investments that have yet to translate into proportional earnings growth. Investors should closely monitor the company’s final audited results and management’s commentary on cost control and the long-term profitability outlook of its new business segments.

Board and Management

As of the date of this announcement, the board includes:
Executive Director: Mr. Zheng Bin
Non-executive Directors: Mr. Zhong Baiyi (Chairman), Ms. Xiao Jianhong, Mr. Zheng Feng, Ms. Xu Zhoumei
Independent Non-executive Directors: Mr. He Shuqi, Mr. Liu Yongquan, Mr. Chan Tsz Kit

Disclaimer: The above article is based on preliminary unaudited information provided by Impression Dahongpao Co., Ltd. and may be subject to changes upon final audit. This article does not constitute investment advice. Investors are advised to review the company’s official disclosures and consult with their financial advisers before making investment decisions.

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