WENYE GROUP (01802) expects a year-on-year decrease in profit for the first half of the year to be no less than approximately 4 million yuan.

The WENYE GROUP (01802) announced that the group's expected earnings for the six months ending June 30, 2024 will decrease by approximately RMB 13.5 million to not less than approximately RMB 4 million in the first half of 2025, compared to a loss of approximately RMB 21.7 million in the first half of 2024. The net profit for the first half of 2025 is expected to be not less than approximately RMB 800 million, and the group's net liabilities are expected to decrease significantly from approximately RMB 930 million as of December 31, 2024 to not more than approximately RMB 70 million in the first half of 2025. The announcement stated that: (i) Decrease in revenue - (a) Slow macroeconomic conditions and the slow recovery of the Chinese real estate market, which is closely related to the group's decoration business; and (b) Debt and litigation of Shenzhen Wenyi Decoration Design Engineering Co., Ltd. (Wenyi Decoration) as well as freezing of bank accounts have made it difficult for the group to obtain new contracts and operate in the construction decoration and design business. (ii) Turning losses into profits - As announced by the company on June 12, 2025, the sale of the company holding equity in Wenyi Decoration, as a former subsidiary of Sosang (HK) Holdings Limited, has significantly increased the group's other income. (iii) Significant reduction in net liabilities - After selling Wenyi Decoration, its liabilities were removed from the group. Wenyi Decoration bears most of the group's liabilities, and the company has provided a guarantee for a loan of approximately RMB 41.68 million to Wenyi Decoration.