ISP HOLDINGS (02340) has issued a profit warning, forecasting a net loss attributable to shareholders of between HK$24 million and HK$28 million for the six months ending June 30, 2026. This represents an increase from the approximately HK$22.6 million loss reported in the same period last year.

The company stated that revenue for the current period is expected to rise by 45% to 50% compared to the prior corresponding period. The combination of higher revenue and an increased loss is attributed to several factors.

First, the revenue growth of about 45% to 50% follows a satisfactory replenishment of the order book after new contracts were secured last year. Second, the current period includes additional liquidated damages related to completed projects that experienced delays. Third, ongoing litigation and arbitration cases have incurred substantial costs.

Specifically, a partial award on liability and quantum in one arbitration case was issued in the first half of 2026, leading to extra legal expenses for subsequent proceedings. Additionally, the second phase hearing of a litigation case is scheduled to begin at the end of August 2026.