METROPOLIS CAP(08621) issues profit warning, expects pre-tax loss for 2025 to increase to approximately 21.6 million yuan, representing a year-on-year increase of approximately 111.8%

METROPOLIS CAP (08621) announced that the group expects to record an increase in pre-tax loss of approximately RMB 11.4 million (an increase of about 111.8%) for the year ending December 31, 2025 (Fiscal Year 2025), from approximately RMB 10.2 million for the year ending December 31, 2024 (Fiscal Year 2024) to approximately RMB 21.6 million in Fiscal Year 2025.

The increase in pre-tax loss is mainly due to (i) a decrease in revenue of about RMB 21.7 million; and (ii) an increase in impairment provisions for other receivables. This is partly offset by (a) a reduction in impairment provisions related to finance lease receivables and sale-leaseback arrangements; (b) the reversal, rather than recognition, of impairment provisions for financial guarantee contract liabilities; and © decreases in other operating expenses, staff costs, and financing costs.

The group’s expansion of automotive financing lease and leasing consulting services has slowed down. As a result, revenue (especially leasing consulting service income) for Fiscal Year 2025 has decreased. The group is currently focused on actively recovering receivables, such as selling financed vehicles and pursuing legal action against defaulting customers.

Although leasing receivables and factoring receivables decreased in Fiscal Year 2025, impairment provisions for these receivables are still recognized due to some receivables being overdue for a long period. The increase in impairment provisions for other receivables is mainly due to advances provided to supporting service providers following defaults by leasing consulting clients. Management will closely monitor the group’s asset performance and take appropriate actions when necessary.