Royale Home Holdings Ltd. reported a sharp deterioration in its 2025 results, weighed down by weak furniture demand, higher finance costs and sizeable impairment charges.

Revenue and Margins • Group revenue slid 27.5% year-on-year to RMB381.09 million, driven mainly by a 27.7% drop in furniture sales to RMB365.41 million. • Gross profit declined 46.3% to RMB19.03 million; gross margin contracted to 5.0% from 6.7% in 2024.

Bottom-Line Performance • Loss attributable to shareholders expanded 80.3% to RMB602.80 million. • Basic loss per share increased to RMB0.2433 from RMB0.1350. • Key loss drivers included: – RMB66.90 million inventory and goodwill impairments; – RMB51.06 million fair-value loss on investment properties versus a RMB1.98 million gain a year earlier; – RMB144.34 million share of associates’ losses versus RMB16.30 million in 2024; – Finance costs up 24.4% to RMB213.58 million, mainly on related-party borrowings.

Segment Highlights • Furniture manufacturing and sales remained the core contributor, accounting for 95.9% of total revenue. • Hotel operations generated RMB15.50 million. • The aluminium trading segment was terminated during the year.

Balance Sheet and Liquidity • Cash and cash equivalents stood at RMB78.30 million (2024: RMB20.45 million). • Net current assets turned positive at RMB10.17 million, versus a RMB699.15 million deficit a year earlier. • Interest-bearing bank and other borrowings totalled RMB858.76 million; loans from the immediate, ultimate and fellow holding companies plus medium-term bonds amounted to RMB2.44 billion. • Gearing ratio (net debt to capital plus net debt) rose to 86% from 72%. • Net assets fell to RMB709.07 million from RMB1.45 billion.

Going-Concern Risk The auditor highlighted a material uncertainty over going concern due to the RMB617 million annual loss and sizable short-term borrowings against limited cash. Management plans include loan rollovers under a RMB2.00 billion guarantee from the ultimate holding company, asset disposals and cost controls.

Corporate Actions • Disposals of an associate and a subsidiary delivered a combined gain of RMB60.70 million. • All outstanding medium-term bonds were redeemed and repurchased after the reporting date.

Strategic Outlook for 2026 The group intends to: 1. Strengthen its core home-furnishing business and expand engineering projects. 2. Accelerate digitalisation and AI-driven product development. 3. Pursue overseas market growth via newly formed Overseas Business Division. 4. Continue asset disposals and debt optimisation to reduce finance costs and bolster liquidity.

No final dividend was proposed for 2025.