Xiangxing Technology (01732) issued a profit warning. The net loss for the first half of the year is expected to be about 5 million yuan, a year-on-year profit to loss

According to Zhitong Finance App, Xiangxing Technology (01732) announced that the Group is expected to have a net loss of approximately RMB 5 million for the six months ending June 30, 2026, while net profit for the six months ended June 30, 2025 is approximately RMB 6.9 million.

According to the announcement, the loss was mainly due to an increase in tax expenses of about RMB 8.1 million, mainly due to the additional tax assessment of a subsidiary of the Group during the relevant period on the balance of transactions within the Group that had not previously accrued interest. The tax authorities believe that interest is accrued on these intra-group transaction balances, and that the estimated interest income from this is subject to corporate income tax, additional tax, and interest on overdue taxes; and that the increase in the Group's sales costs exceeds the increase in revenue, leading to a decrease in gross profit during the relevant period.