HK Stock Market Move | EDA GROUP HLDGS (02505) once fell more than 41% to set a new low, expected net loss of about 12 million yuan last year, turning from profit to loss year-on-year.

EDA GROUP HLDG (02505) fell by over 41% in the afternoon, hitting a new low of HK$0.31. As of the time of writing, it has fallen by 35.85% to HK$0.34, with a turnover of HK$5.4089 million. On the news front, on the evening of March 27, EDA GROUP HLDGS issued a profit warning. Compared to the net profit of approximately RMB 47.1 million in the fiscal year 2024, the group expects to incur a net loss of approximately RMB 12 million for the year ending December 31, 2025. Compared to the adjusted net profit of approximately RMB 113.9 million in the fiscal year 2024, the group expects to incur an adjusted net loss of approximately RMB 8.5 million during the reporting period. The company attributed the decline mainly to its overseas warehouse strategic investment. With the addition of new leased overseas warehouses in the second half of 2024 and 2025, these overseas warehouses require a ramp-up period before they become profitable. However, related costs have significantly increased, mainly due to the amortization of the right-of-use assets and the recognition of interest expenses on lease liabilities. Adjustments to tariff policies during the reporting period have increased market uncertainty and intensified industry competition, leading to a continuous decrease in order prices. Additionally, there has been an increase in overseas logistics and labor costs during the reporting period, as well as an increase in the provision for credit losses on accounts receivable expectations.