BAWANG GROUP issues a profit warning, expecting a net loss of approximately 4.9 million yuan in the first half of the year
BAWANG GROUP issued a profit warning, expecting a net loss of approximately 4.9 million yuan for the first half ending June 30, 2025, compared to a net profit of approximately 1.2 million yuan for the same period in 2024. Despite a revenue increase of about 11%, the group anticipates a loss due to rising prices of key raw materials and significant increases in sales and distribution costs, leading to a decline in gross profit margin
According to the announcement from BAWANG GROUP (01338), the group expects to incur a net loss of approximately RMB 4.9 million for the six months ending June 30, 2025, compared to a net profit of approximately RMB 1.2 million for the same period in 2024.
Although the group's revenue increased by approximately 11% in the first half of 2025 compared to the first half of 2024, the main reasons for the expected net loss in the first half of 2025 are: (1) a significant increase in the price of a key raw material, leading to a slight decline in gross margin; (2) a significant rise in sales and distribution costs to drive sales growth, including store display arrangements and incentive programs conducted in the first half of 2025
