KIDSLAND INTL (02122) issued a profit warning, expecting the mid-term net loss after tax to not exceed 15 million yuan.

KIDSLAND INTL (02122) announced that the Group expects to record an after-tax net loss of no more than RMB 15 million for the six months ending June 30, 2026, compared to an unaudited after-tax net loss of approximately RMB 67.6 million for the six months ending June 30, 2025, and an audited after-tax net loss of approximately RMB 130 million for the year ending December 31, 2025. According to what the board members are aware of, the financial performance during the reporting period is expected to exceed that of the previous period and the year 2025, primarily due to the following factors: (i) Revenue growth is driven by the optimization of a targeted product portfolio and the deployment of innovative channels, including the expansion of the Pokmon collaboration through Pokmon-themed areas in official Pokmon card arenas and the Group's retail stores and consignment counters, the ongoing development of the Sam's Club sector, and the launch of new retail stores like Hall One; (ii) Margin improvement is attributed to the continuous enhancement of the product structure, with core initiatives including: the introduction of high-margin brands, strengthening the Group's market positioning in high-demand categories, and mitigating the erosion of margins caused by retail discounts; and (iii) Enhancing operational efficiency and reducing expenses through retail network optimization and organizational restructuring. However, the board believes that the Group's business outlook and financial performance sustainability in the second half of 2026 remain challenging and uncertain due to the following factors: (i) High volatility in consumer sentiment due to macroeconomic conditions, accompanied by continuously evolving market dynamics and consumer preference cycles; (ii) Increased structural competition within the retail landscape and potential cost pressures.