Gaoxin Retail (06808)'s net loss for the medium term is expected to be about 500 million yuan to 550 million yuan as well as losses attributable to the company's owners

According to Zhitong Finance App News, Gaoxin Retail (06808) issued an announcement. It is expected that for the six months ending September 30, 2026 (relevant period), the Group's net loss and loss attributable to the company owner will be approximately RMB 500 million to RMB 550 million (unaudited) in accordance with the Hong Kong Financial Reporting Accounting Standards, while net losses and losses attributable to company owners for the same period last year were RMB 127 million and RMB 123 million respectively.

During the relevant period, the Group is expected to obtain (i) adjusted EBITDA, that is, profit before adjusted interest, tax, depreciation and amortization, of approximately RMB 1 billion to RMB 1.05 billion (unaudited, not measured by the Hong Kong Financial Reporting Standards); (ii) net cash from operating activities is approximately RMB 1.75 billion to RMB 1.8 billion (unaudited), and net cash from operating activities for the same period in 2025 is RMB 1,323 billion. The Group continues to promote the optimization of store asset portfolios, carefully evaluate the operating performance of each store, take the opportunity to withdraw stores under pressure, and continues to make substantial progress in various management reforms, helping to gradually narrow losses.

Expected net losses and losses attributable to company owners are mainly due to: (i) the downward trend in customer unit prices during the period, but passenger flow declined somewhat due to market competition and diversion, leading to a decline in revenue; (ii) cost savings partially hedged profit losses due to the decline in revenue; (iii) product and supply chain adjustments, store and shopping street adjustments were still in the transformation and adjustment stage; and (iv) some stores to be closed continued to lose money during the relevant period, thereby putting short-term pressure on current profits.

The Group actively promotes comprehensive upgrading of goods and markets. On the product side, establish a nationwide joint procurement system, develop our own brands, streamline SKUs, and optimize the category structure. The store-side implemented area reduction, freed up space to expand the shopping district, and the modular store reform progressed steadily, simultaneously promoting the layout of new stores and front warehouses, and constructing a multi-format layout for large supermarkets, Chinese supermarkets, and front warehouses. The Group continues to optimize store rental costs and adjust inefficient store assets. The Group adheres to structural transformation. After short-term pain, improvements in product strength, store efficiency and asset structure will gradually consolidate the long-term operating foundation.