Austasia Group (02425) issued a profit warning, expecting the net loss for the 2024 financial year to increase by about 11.7 billion to 13.8 billion compared to the previous year.

AUSTASIA GROUP (02425) announces that it expects to incur a comprehensive loss of approximately RMB 11.7 billion to RMB 13.8 billion for the year ending December 31, 2024, compared to a loss of approximately RMB 4.89 billion for the year ending December 31, 2023. The increase in expected losses is mainly attributable to: (i) an increase in losses from changes in fair value minus selling costs of other biological assets (revaluation losses). In the 2024 fiscal year, expected revaluation losses are expected to be approximately RMB 11.8 billion to RMB 13.9 billion, compared to approximately RMB 6.68 billion in the 2023 fiscal year. The increase in revaluation losses is mainly due to a decrease in the selling prices of raw milk and cull cows; and (ii) decreases in the selling prices of raw milk and cull cows. In the 2024 fiscal year, the average selling prices of raw milk and cull cows of the Group decreased by approximately 17% and 16% respectively compared to the 2023 fiscal year. Despite facing many challenges, the Group has taken effective measures to reduce costs and has achieved significant cost savings throughout the entire 2024 fiscal year. In the 2024 fiscal year, the selling cost per kilogram of raw milk and the feeding cost per kilogram of raw milk decreased by approximately 16% and 19% respectively. In addition, the Group continues to improve milk production efficiency, with the average annual milk production per dairy cow reaching a new record of 14.0 tons in the 2024 fiscal year (compared to 13.6 tons in the 2023 fiscal year), an increase of approximately 2.9%.