Key Highlights

• Significant reduction in expected full-year loss: Sunac China Holdings Limited anticipates its loss attributable to shareholders for the year ended 31 December 2025 to be between RMB12.0 billion and RMB13.0 billion—a notable improvement from the previous year’s loss of approximately RMB25.70 billion.
• Primary reason for narrowed loss: The reduction is mainly due to the recognition of gain from offshore debt restructuring during 2025.
• Underlying challenges persist: Excluding the one-off gains from debt restructuring, the company continues to face substantial headwinds including:
  • A significant decline in recognized revenue.
  • Pressure on gross profit margins, attributed to challenging market conditions.
  • Additional provisions for asset impairment.
  • Provisions for contingent liabilities.
• Unaudited financials: The information disclosed is based on preliminary unaudited management accounts and has not yet been audited or reviewed by the board’s audit committee. Actual results may differ.
• Annual results announcement: Investors should expect the formal annual results announcement before the end of March 2026.

Important Shareholder Information & Price Sensitive Issues

• Share price implications: The substantial improvement in net loss due to debt restructuring may be viewed positively by the market, as it signals progress in addressing financial distress. However, continued operational challenges and asset impairments suggest ongoing risks.
• Potential volatility: Shareholders and potential investors are strongly advised to exercise caution in dealing with Sunac China securities, given the significant uncertainties and the unaudited nature of the financials.
• Market sensitivity: The announcement of a lower-than-expected loss, primarily due to a one-off restructuring gain rather than fundamental business recovery, may drive short-term volatility in share price. Investors should closely monitor subsequent disclosures and the upcoming audited annual results.

Additional Details

• The announcement was made in compliance with Hong Kong Stock Exchange Listing Rules and the Securities and Futures Ordinance, underscoring its regulatory importance.
• The board of directors is led by Chairman Sun Hongbin, with a mix of executive and independent non-executive directors overseeing governance.
• This profit warning reflects broader challenges facing the Chinese real estate sector, including declining revenues, margin compression, and asset impairments.

Summary for Investors

Sunac China Holdings’ FY2025 profit warning signals a material reduction in net losses, driven by gains from offshore debt restructuring. However, underlying business conditions remain difficult, with revenue declines, margin pressures, and asset write-downs. The unaudited nature of these figures introduces further uncertainty. Investors should remain vigilant, look out for the formal audited results in March 2026, and approach any trading decisions with caution given the high degree of price sensitivity and ongoing financial risks.

Disclaimer: This article is based on preliminary unaudited management information and may not reflect the final audited results. Investors should consult the official annual results announcement and seek professional advice before making any investment decisions. Sunac China Holdings’ financial performance is subject to significant market and operational risks.

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