Kuang Shi Fangxiang (01925) issued a profit warning. It is expected that the net loss due to shareholders in the medium term will be about 20 million yuan in profit and loss year over year

According to Zhitong Finance App, Kuang Shifangxiang (01925) issued an announcement. The Group expects to obtain a net loss of about RMB 20 million due to the owners of the Company for the six months ending June 30, 2026, while the net profit attributable to the Company's owners is approximately RMB 23 million for the six months ending June 30, 2025.

The Board of Directors believes that the deterioration in financial performance during the current period was mainly due to a net exchange loss of approximately RMB 27.4 million due to the depreciation of the US dollar against the RMB for the six months ended June 30, 2026. The Group holds a significant proportion of financial assets denominated in US dollars (mainly trade receivables and bank balances) from overseas sales, and the depreciation of the US dollar during this period led to a decline in the value of such financial assets. The depreciation of the US dollar against the RMB has also led to a drop in the sales price of equivalent units of products denominated in RMB. Since most of the Group's suppliers are local companies in China, and the Group is settled in RMB, the corresponding production costs have remained stable, leading to a decline in gross margin.

Furthermore, the fair value of the Group's investment in the fund declined, resulting in a fair value loss of approximately RMB 3.7 million for the six months ended June 30, 2026, while the fair value income from the fund's investment was approximately RMB 3.4 million for the six months ended June 30, 2025. In addition, the Group received approximately RMB 6.7 million in government subsidies for the six months ended June 30, 2025, while the government subsidy received for the six months ended June 30, 2026 was reduced to approximately RMB 2.9 million, resulting in a decrease in the Group's profit for the six months ended June 30, 2026.