HUILI RES issued a profit warning, expecting the interim net profit attributable to shareholders to decline to between 15 million and 20 million yuan

According to the announcement from HUILI RES (01303), the group expects to achieve a net profit attributable to equity holders from continuing operations of approximately RMB 15 million to RMB 20 million for the six months ending June 30, 2025. In comparison, for the six months ending June 30, 2024 (the corresponding period), the net profit attributable to equity holders from continuing operations was approximately RMB 118 million.

The expected significant decrease in net profit during the reporting period to approximately RMB 15 million to RMB 20 million is mainly attributed to the combined effects of the following factors:

1. The group's gross profit decreased from approximately RMB 130 million in the corresponding period to approximately RMB 53 million in the reporting period, due to a decline in coal prices during the reporting period and a significant decrease in the gross profit margin of the coal trading business;

2. A one-time gain of approximately RMB 20 million from the bargain purchase of CC Bong Logistics Limited in the corresponding period, which was not realized during the reporting period;

3. Expected credit loss reversal of approximately RMB 16 million during the reporting period, compared to an expected credit loss provision of approximately RMB 100,000 for accounts receivable and other receivables in the corresponding period; and

4. A foreign exchange loss of approximately RMB 10 million recorded during the reporting period, compared to a foreign exchange gain of approximately RMB 4 million in the corresponding period