SoftMedx Healthcare Limited Issues Profit Warning: Significant Non-Cash Loss for FY2025

Key Points of the Announcement

• Profit Warning Issued: SoftMedx Healthcare Limited has issued a profit warning for the financial year ended 31 December 2025.
• Expected Loss: The Group anticipates recording a significant loss of approximately HK\$405 million for FY2025.
• Reason for Loss: The loss is primarily due to a one-off, non-cash fair value loss of approximately HK\$412 million related to a debt settlement in specie.
• Debt Settlement Details: The loss arose from the issuance of 1,800 million new shares at HK\$0.01 per share on 11 November 2025 for loan settlement purposes, compared to the then closing market price of HK\$0.239 per share.
• Underlying Business Performance: Excluding this exceptional item, the Group would have recorded a net profit of approximately HK\$10 million from its ordinary business operations, an improvement from the HK\$6.9 million net profit (excluding exceptional items) in 2024.
• No Cash or Balance Sheet Impact: The loss is non-cash in nature and does not affect the Group’s balance sheet, cashflow, or net asset value.
• Results Not Finalized: The figures provided are based on preliminary assessments of unaudited consolidated management accounts and have not been reviewed or audited by the Company’s auditors or the audit committee.
• Announcement Date for Final Results: The audited annual results are expected to be released on 27 March 2026.

Price Sensitive Information for Shareholders

• Substantial Non-Cash Loss: The recognition of a HK\$412 million non-cash loss due to fair value adjustment in debt settlement is a significant event that may impact the Company’s reported profit and could trigger a reaction in share price due to headline loss figures.
• Underlying Profitability Remains Intact: Excluding the one-off loss, the Group’s core business remains profitable and has shown growth compared to the prior year, which may reassure long-term investors about the business’s ongoing health.
• Non-Impact on Core Financials: As the loss is non-cash and does not affect net asset value, cashflow, or the balance sheet, the fundamental value of the Company remains stable, which is critical for investor confidence.
• Pending Final Results: Investors are advised to await the audited financial statements and the official annual results announcement on 27 March 2026 for confirmed figures and further details.
• Exercise Caution: Shareholders and potential investors are strongly advised to exercise caution when dealing in the shares of the Company in light of this profit warning and the anticipated headline loss.

Additional Details

• The fair value loss was calculated based on the difference between the issue price of the new shares (HK\$0.01 per share) and the market closing price on the issue date (HK\$0.239 per share).
• The profit warning is made in accordance with Rule 13.09 of the Listing Rules and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance of Hong Kong.
• The board of directors comprises Mr. Lin Pinzhuo as executive Director; and Mr. Ngok Ho Wai, Ms. Tang Cuihuen, and Mr. Yiu Chun Wing as independent non-executive directors.
• The announcement was issued by Company Secretary Lam Sung Him Gaston on 25 March 2026.

Conclusion

The profit warning from SoftMedx Healthcare Limited is a material event, primarily due to a large, one-off, non-cash loss stemming from a fair value adjustment on shares issued for loan settlement. While this will result in a significant headline loss for FY2025, the underlying business remains profitable. Investors are urged to consider both the nature of the loss and the ongoing profitability of the core business, and to review the audited annual results to be released on 27 March 2026 before making investment decisions.

Disclaimer: This article is based on preliminary unaudited financial information released by SoftMedx Healthcare Limited and does not constitute investment advice. Investors should refer to the Company’s official audited results and consult their financial advisors before taking any action.

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