Hong Kong-listed DC Holdings (Digital China Holdings Limited) has disclosed the unaudited first-quarter results of its 38.61%-owned Shenzhen subsidiary, Digital China Information Service Group Company Ltd. (DCITS), for the period ended 31 March 2026.

Revenue and Earnings • DCITS generated revenue of RMB 1.77 billion, down 18.27% year-on-year from RMB 2.16 billion. • Net loss attributable to DCITS shareholders narrowed slightly to RMB 92.47 million, an improvement of 0.50% from the RMB 92.94 million loss a year earlier. • Basic and diluted losses per share remained essentially flat at RMB 0.0962. • Weighted average return on net assets was –1.64% versus –1.66% in the prior-year period.

Segment and Contract Performance • Total new contracts reached RMB 922 million, of which RMB 776 million (84%) came from financial software and services. • Revenue from the financial industry was RMB 784 million, with financial software and services contributing RMB 755 million (96%). • Key wins included core banking, treasury management, ESB & Microservices, and AI-driven data-intelligence projects for commercial and regional banks in Hainan, Xinjiang, Anhui, Beijing, Shanghai and Zhejiang.

Cash Flow and Balance-Sheet Movements • Operating cash outflow improved to RMB 1.01 billion, a 60.73% reduction from the prior-year outflow of RMB 2.58 billion, mainly due to lower payments for goods. • Net cash used in investing activities expanded to RMB 364.90 million, reflecting higher purchases of wealth-management products. • Financing cash inflow plunged 99.59% to RMB 8.96 million as new borrowings declined sharply. • Cash and bank balances fell 48.72% to RMB 1.44 billion, while financial assets held for trading surged 377.75% to RMB 489.13 million. • Total assets stood at RMB 11.84 billion, down 5.44% from year-end 2025; inventories increased to RMB 2.90 billion and contract assets to RMB 2.49 billion.

Expense and Impairment Trends • Financial expenses swung to a RMB 3.57 million gain, driven by exchange gains. • Other income rose 64.66% to RMB 14.97 million on higher government grants. • Asset impairment losses climbed 42.81% to RMB 66.75 million, primarily due to additional inventory write-downs. • Credit impairment losses totaled RMB 77.19 million, down 16.05% year-on-year.

Capital Structure and Shareholders • Treasury shares fell 69.36% to RMB 46.04 million after transferring 9.75 million shares to the company’s 2026 Employee Stock Ownership Plan (ESOP). • Minority interests dropped 69.28% to RMB 27.43 million, reflecting period losses. • Digital China Software Limited remained the largest shareholder with a 38.61% stake, while the new ESOP holds 1.00% of DCITS.

Outlook and Strategic Focus DCITS reiterated its commitment to a FinTech-centric strategy, emphasizing “AI for Process” applications across software engineering and financial business domains. The company reported substantive progress in integrating artificial intelligence throughout requirements, design, coding and testing phases, and in building end-to-end wealth-management solutions in collaboration with leading banks.

Cautionary Note The disclosed financials are unaudited and pertain solely to DCITS; they do not represent consolidated results for DC Holdings. Shareholders and investors are advised to exercise caution when dealing in DC Holdings’ shares.