HK Stock Market Move | HOWKINGTECH(02440) fell more than 6% after issuing a profit warning, with expected annual earnings to decrease by 75%-85% year-on-year.

HOWKINGTECH (02440) fell more than 6% after issuing a profit warning, with a drop of 6.42% to HK$3.5 at the time of writing, with a turnover of HK$7.9185 million. On the news front, on February 21, HOWKINGTECH announced that the group is expected to decrease its income for the year ending December 31, 2024, by 75% to 85% compared to the year ending December 31, 2023, to approximately RMB 441 million. Compared with the adjusted net profit of approximately RMB 36 million for the year ending December 31, 2023, the adjusted net loss for the fiscal year 2024 (measured by non-Hong Kong financial reporting standards) is expected to be between RMB 55 million and RMB 70 million. The decrease in estimated income for the fiscal year 2024 is mainly attributed to customers in the group's IoT industry delaying their projects due to concerns about cash flow and uncertainty in the macroeconomic situation, resulting in a decrease in revenue from data transmission and processing services, as well as insufficient customer demand leading to a decrease in equipment sales revenue for the fiscal year 2024. The decrease in estimated income, along with intensified market competition, has led to a decrease in gross profit margin, and delays in payment have increased trade receivables impairment losses, resulting in an estimated adjusted net loss for the group in the fiscal year 2024.