SCHOLAR EDU (01769) has announced its interim results for the six months ended June 30, 2026, revealing a significant decline in profitability. The group recorded revenue of RMB 424 million, representing a year-on-year decrease of 3.5%. Profit attributable to owners of the company stood at RMB 12.757 million, a sharp reduction of 79.7% compared to the same period last year. Adjusted profit also fell substantially by 68% to RMB 26.031 million, with earnings per share reported at RMB 1.93 cents.

The company's strategic expansion in Guangdong Province has been progressing steadily. The group's courses in Guangzhou have gained recognition from both parents and students, achieving encouraging initial results. Currently, student enrollment across the new learning centers in Guangzhou is performing well, with overall operations exceeding expectations. However, certain quality-oriented learning centers have required longer-than-anticipated initial operational cycles and market penetration preparation periods.

Consequently, these learning centers, particularly during their early operational phase, have generated relatively limited revenue. Meanwhile, direct operating costs, including employee compensation and benefits, amortization, depreciation, utilities, and property management expenses, have remained at elevated levels relative to the revenue they produce. This cost-revenue imbalance has exerted a negative impact on the group's overall profitability.