HOPSON DEV HOLD (00754) issues profit warning, expects consolidated loss of not less than HK$12.5 billion for 2025, turning from profit to loss year-on-year.

HOPSON DEV HOLD (00754) announces that the Group expects to record a consolidated loss of not less than HK$12.5 billion for the year ended 31 December 2025, turning from a profit for the same period in 2024 to a loss. Nevertheless, the core business has demonstrated strong resilience. The Group expects that the core profit for the year ended 31 December 2025 (referring to net profit after excluding the impact of non-recurring items such as impairment losses and fair value changes) will be not less than HK$1.2 billion, representing a decline significantly lower than the overall profit change compared with the same period in 2024, reflecting that the Group's core operating capability remains stable amid the industry transformation as the PRC real estate market enters an era of stock development. The results for the year ended 31 December 2025 were affected by the combined impact of the overall downturn in the real estate market and the industry's deep transformation from incremental development to stock operation, with a phased decline in property sales revenue, indications of impairment in inventories in certain non-first-tier cities, as well as adjustments to the fair value of investment properties and a loss from the disposal of an associate. The above factors are primarily non-cash in nature and have no material impact on the Group's operating cash flow. The Group's overall financial position remains sound, with debt scale being reduced in an orderly manner as planned, while further optimizing the debt structure through debt restructuring and/or extensions. Currently, there are no outstanding offshore notes. For the year ended 31 December 2025, the Group's commercial real estate investment and operation and property management businesses continued to play a stabilizing role, contributing a reliable and sustainable source of profit to the Group as always, fully demonstrating the long-term strategic value of the Group's adjustment and optimization of its business structure from traditional residential development to real estate asset operation and management, property services, and other directions. Against the backdrop of China's real estate entering the stock era and the industry's deep transformation and development, the Group proactively adapts to industry trends, actively responds to national policy directions, adheres to a prudent and steady financial approach, continuously promotes business structure upgrading, and focuses on core capability building and improvement of asset operation efficiency. The Group will further optimize the allocation of resources across all areas, deepen its brand advantages, enhance market competitiveness and recognition, and accumulate momentum for future high-quality development.