Xinji Shaxi Group Co., Ltd Issues Positive Profit Alert: Significant Reduction in FY2025 Loss Expected

Key Points from the Announcement

• Substantial Reduction in Net Loss: The Board of Xinji Shaxi Group Co., Ltd expects the net loss attributable to shareholders for the financial year ended 31 December 2025 (FY2025) to be between RMB22.0 million and RMB32.0 million, a considerable improvement compared to the net loss of approximately RMB162.1 million recorded in FY2024.
• Primary Reason for Loss Reduction: The main driver behind the expected decrease in net loss is a reduction in fair value losses on investment properties. This improvement stems from:
  • An improvement in operating conditions at the “Xinji Shaxi Hospitality Supplies Expo Center” following delays in renovation.
  • A narrower decline in occupancy rates at the two shopping malls in Shenyang compared to the previous year, leading to reduced valuation losses.
• Core Net Profit Outlook: After excluding one-off or non-recurring items (such as changes in investment property fair value and related income tax), the Group’s core net profit for FY2025 is expected to decrease by not more than RMB20.0 million, compared to the core net profit of RMB73.8 million for FY2024. The Board notes that these adjustments are based on non-Hong Kong Financial Reporting Standards and are not considered indicators of the Group’s business performance.
• Financial Results Not Finalised: The financial results for FY2025 are still being finalised. The figures shared are based on unaudited management accounts and may be subject to further adjustments. The audited results are expected to be published by the end of March 2026.

Important Information for Shareholders and Potential Investors

• Price Sensitive News: The announcement signals a dramatic improvement in the Group’s financial position, with losses shrinking by over RMB130 million year-on-year. This turnaround is likely to be viewed positively by the market and could impact share value.
• One-Off Effects: Shareholders should note that the improvement is largely due to non-recurring factors, such as reduced property valuation losses and income tax adjustments. The underlying core profitability is expected to decrease, which may temper investor enthusiasm if the fundamental business performance remains weak.
• Caution Advised: As these figures are preliminary and unaudited, investors are advised to exercise caution when dealing in Xinji Shaxi Group shares until the final financial results are released.
• Leadership and Governance: The announcement also lists the current Board members, including executive, non-executive, and independent directors, underscoring the Group’s governance structure.

Detailed Analysis

Xinji Shaxi Group Co., Ltd has issued a positive profit alert for FY2025, projecting a significant reduction in net loss compared to the previous year. The anticipated net loss range of RMB22.0 million to RMB32.0 million marks a notable improvement from FY2024’s RMB162.1 million loss. The Board attributes this improvement primarily to decreased fair value losses on investment properties, thanks to better operating conditions at key assets and a more stable occupancy rate in Shenyang shopping malls.

However, investors should pay close attention to the fact that, once adjusted for non-recurring items, the Group’s core net profit is expected to decline by up to RMB20.0 million from FY2024’s RMB73.8 million. This suggests that the underlying business may not be as robust as the headline reduction in losses might imply.

The Group’s financial results for FY2025 are not yet audited and may be subject to further adjustments. The final numbers will be published by March 2026. Shareholders and potential investors are urged to exercise caution in their investment decisions pending the release of the audited results.

Given the magnitude of the loss reduction and the possible influence of non-recurring factors, this announcement is likely to be price sensitive and could affect the share value of Xinji Shaxi Group Co., Ltd.

Disclaimer

The information in this article is based on the unaudited and preliminary announcement by Xinji Shaxi Group Co., Ltd. Investors should not rely solely on this article for investment decisions and are strongly advised to consult the final audited financial statements and other official disclosures before transacting in the Company’s shares. The author accepts no responsibility for any loss or damage arising from reliance on this article.

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