MAOYE INT'L (00848) issued a profit warning, expecting a net loss of approximately 120 million to 180 million yuan for the first half of the year, turning from profit to loss compared to the previous year.

MAOYE INT'L (00848) announced that the group expects to incur a net loss of approximately 120 million to 180 million yuan in the first half of 2026, compared to a net profit of about 11.92 million yuan in the first half of 2025. For the current period, excluding the impact of impairment losses from fair value changes of investment properties of approximately 125 million yuan and goodwill impairment losses of approximately 45 million yuan, the operating net loss for the first half of 2026 is expected to be between 8 million and 38 million yuan. The announcement stated that the expected transition from profit to loss is primarily due to the impact of the macro environment on the performance of the core business. The department store retail industry is still in a stage of bottoming out and adjustment, combined with insufficient residential consumption momentum and a drop in average transaction value, which has led to a decline in the company's revenue and pressure on net profit. During the reporting period, several stores were closed due to the inability to reach consensus on the terms of leasing cooperation with relevant contracting parties, including the Inner Mongolia Vitoria Times City and the Qinhuangdao Modern Shopping Plaza store. The closure of these stores resulted in a decrease in operating revenue of approximately 94.28 million yuan compared to the same period last year, and a reduction in net profit of about 31.35 million yuan. During the reporting period, in accordance with relevant accounting policies, the management, adhering to the principle of prudence, intends to account for an impairment loss on fair value changes of investment properties of approximately 125 million yuan and an impairment loss on related goodwill of approximately 45 million yuan.