MEIDONG AUTO (01268) issues a profit warning with an expected loss of approximately 2.3 billion yuan for equity shareholders in 2024, turning from profit to loss year-on-year.

MEIDONG AUTO (01268) announced that it is expected to record a net loss attributable to equity shareholders for the year 2024, compared to a profit in the previous year. The announcement stated that the shift from profit to loss is mainly attributed to the price war in the automotive market and the impact of macroeconomic factors in the second half of 2024. The company, with the assistance of external valuers, conducted impairment assessments and recognized a non-cash impairment of goodwill and dealer rights of approximately RMB 2.8 billion in the second half of 2024, in addition to an impairment of approximately RMB 200 million in the first half of 2024. The total impairment of goodwill and dealer rights for the full year of 2024 amounted to approximately RMB 3 billion. Due to the factors mentioned above, it is expected that the company will report a net loss attributable to equity shareholders of approximately RMB 2.3 billion for the year 2024, compared to a profit of approximately RMB 100 million in the year 2023.