NEXION TECH issued a profit warning, expecting an annual loss attributable to shareholders of no more than HKD 15 million
NEXION TECH issued a profit warning, expecting an annual loss attributable to shareholders not exceeding HKD 15 million for the year ending December 31, 2024, an increase compared to the previous year's loss of HKD 13.743 million. The increase in loss is mainly due to the SaaS division turning to a loss, reduced sales activities, and the recognition of impairment losses on intangible assets. The losses in the cybersecurity and IT software development divisions have improved, and depreciation and amortization have decreased this year
According to the announcement from NEXION TECH (08420), the group expects to incur a loss attributable to equity holders of the company not exceeding HKD 15 million for the year ending December 31, 2024, compared to a loss of approximately HKD 13.743 million for the year ending December 31, 2023 (the previous year).
The board of directors believes that the increase in expected losses is mainly due to the combined effects of the following items: the performance of the Software as a Service (SaaS) segment (adjusted EBITDA) changed from a profit of approximately HKD 1.186 million in the previous year to a loss not exceeding HKD 7.5 million this year, primarily due to a reduction in service fees to cope with increasingly fierce market competition; a decrease in sales activities; and the recognition of an impairment loss provision for intangible assets not exceeding HKD 4 million (previous year: none); the performance loss (adjusted EBITDA) of the cybersecurity solutions and IT software development segment decreased from approximately HKD 4.446 million in the previous year to a loss not exceeding HKD 1.8 million this year, mainly due to revenue improvement in this business segment and no goodwill impairment recognized this year (previous year: approximately HKD 2.77 million); and the recognition of depreciation and amortization this year decreased to not exceeding HKD 900,000 (previous year: approximately HKD 2.597 million)
