Hongan Real Estate (01243) expects profit attributable to shareholders in the interim to be no less than HK$150 million, turning a year-on-year loss into a profit

According to the Zhitong Finance App, Hongan Real Estate (01243) announced that the Group expects to record profit attributable to the owner of the parent company of not less than HK$150 million for the six months ending September 30, 2026 (this period), while for the six months ending September 30, 2025 (corresponding period), it will record a loss attributable to the owner of the parent company of about HK$384 million. The Board believes that the expected conversion of loss to profit is mainly due to the following factors:

(1) Gross loss changed from about HK$16.6 million (or gross loss ratio of about 2.7%) to gross profit of about HK$16.6 million (or about 24.0% gross margin) for the period, mainly due to improved gross margin and reduction in related costs of delivered properties during the period; (2) the reduction of sales and distribution expenses from approximately HK$113 million during the corresponding period to approximately HK$15 million in the current period was in line with the reduction in revenue recognized from about HK$591 million to about HK$52.9 million in the current period, due to a decrease in property unit buyers delivered during the period ;( 3) There are no confirmed losses of approximately HK$208 million due to the sale of the Group's 20% shares in certain joint ventures holding student dormitory projects during the corresponding period; (4) it was confirmed that the one-time and non-cash proceeds of about HK$286 million were due to the exemption, of which approximately HK$200 million was attributable to the owner of the parent company; (5) and confirmed that properties under development were deducted about HK$50 million in non-cash transfers during the corresponding period, which mainly reflected a partial improvement in the estimated net realizable value of the relevant property projects; Our group Profit attributable to joint ventures and associated companies was reduced from approximately HK$63.6 million during the corresponding period to approximately HK$19.5 million during the current period.