Brilliance China Automotive Issues Profit Warning: Profit Set to Fall Up to 40% in 2025

Key Highlights

• Significant Decline in Profit Expected: Brilliance China Automotive Holdings Limited has issued a profit warning, anticipating a substantial decrease in audited profit before income tax expense for the year ended 31st December 2025. The company expects a drop of not more than 50% compared to 2024 levels.
• Profit After Tax Also Down Sharply: The Group projects that its audited profit after income tax expense for 2025 will decrease by not more than 40% from 2024. The profit attributable to equity holders for 2025 is also expected to decline by up to 40% from the previous year, which was approximately RMB3,101.1 million.
• Key Reasons for the Profit Shortfall:
  • Drop in Associate Performance: The company’s major associate, BMW Brilliance Automotive Ltd., reported a decline in performance, adversely impacting the Group’s bottom line.
  • Subsidiary Operating Losses: Jinbei (Shenyang) Automotive Co., Ltd., the Group’s major operating subsidiary, incurred operating losses. Notably, the subsidiary only resumed production in the second half of 2025, limiting its contribution to the Group’s results.
  • Lower Withholding Tax: Although the Group’s withholding tax expenses decreased by at least 69% in 2025 compared to 2024 due to lower dividend payments from its subsidiary, this reduction was not sufficient to offset the overall profit decline.
• Ongoing Finalization of Financial Results: The figures shared are based on the management’s preliminary assessment of unaudited management accounts and may be subject to adjustments following internal review. The final audited results will be disclosed by the end of March 2026.

Shareholder and Investor Considerations

• Potential Impact on Share Price: The sharp decrease in both pre-tax and post-tax profits—including a potential 40% reduction in profits attributable to equity holders—constitutes material information that could significantly affect the company’s share price. Investors should be alert to the possible negative market reaction.
• Performance of Strategic Assets: The underperformance of BMW Brilliance Automotive Ltd., a major associate, is particularly noteworthy due to its historical importance to the Group’s earnings.
• Delayed Production Recovery: The fact that Jinbei (Shenyang) Automotive Co., Ltd. only resumed production in the second half of the year suggests ongoing operational challenges, which may continue to affect the Group’s profitability and growth prospects.
• Uncertainty Due to Unaudited Results: As the numbers are still subject to internal review and final audit, there is an additional layer of uncertainty for investors to consider until the official financial results are released.

Investor Guidance

Brilliance China Automotive advises shareholders and potential investors to exercise caution when dealing in the company’s shares in light of this profit warning and the significant uncertainties that remain as the annual results are finalized.

Corporate Governance Update

As of the announcement date, the company’s board comprises three executive directors—Mr. Zhang Yue (Chairman and CEO), Mr. Zhang Wei, and Mr. Guo Hongbo—as well as four independent non-executive directors: Mr. Song Jian, Mr. Jiang Bo, Mr. Dong Yang, and Dr. Lam Kit Lan, Cynthia.

Disclaimer: This article is based on preliminary information released by Brilliance China Automotive Holdings Limited and is intended for informational purposes only. Investors should not rely solely on this summary for investment decisions and are advised to review the company’s official financial disclosures and seek professional advice as necessary. The content herein is not investment advice.

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