XJ International Holdings expects significant FY2025 profit drop on impairment

XJ International Holdings Co., Ltd. (Hope Education Group) expects net profit between RMB366m and RMB416m for FY2025, a significant decrease from RMB613m reported in FY2024. This expected downturn is mainly attributed to a potential non-cash impairment loss of approximately RMB558m on goodwill related to cash-generating units in Sichuan Province and Inner Mongolia Autonomous Region. This loss is driven by revised projected cash flows reflecting current market conditions.

While the impairment loss will not exceed 5% of the Group's total assets and will not impact operating profit or cash flow, the unaudited adjusted non-IFRS net profit for FY2025 is projected to be RMB-13m to RMB37m, compared to RMB693m in FY2024. This non-IFRS adjustment considers items such as changes in fair value of convertible bonds, restructuring costs, and expenses related to converting independent colleges into private universities.

Shareholders are advised to exercise caution as the company finalizes its consolidated financial results for FY2205, which are expected to be published by the end of November 2025. The information presented is based on preliminary reviews and is subject to potential adjustments.