CHEN LIN EDU (01593) announced that the group expects revenue for the fiscal year ending August 31, 2025, to remain stable with a slight increase at approximately RMB 600 million. However, it anticipates an annual loss of no less than RMB 320 million for the 2025 fiscal year, compared to a net profit of about RMB 15.4 million in the 2024 fiscal year.

The expected loss for the 2025 fiscal year is primarily attributed to: 1. A one-time, non-cash impairment loss of no less than RMB 200 million on goodwill and certain non-current assets, due to downward revisions in operational estimates for some cash-generating units acquired in 2020 and 2021. 2. A one-time, non-cash impairment loss of approximately RMB 43 million resulting from the reversal of deferred income, as one of the acquired cash-generating units withdrew its application to register as a for-profit private school, eliminating the obligation to return previously received government subsidies. 3. An increase of about RMB 25 million in non-cash depreciation and amortization costs year-on-year, as infrastructure construction and equipment upgrades at the group’s affiliated institutions were gradually completed.

Since these impairments, one-time losses, and depreciation/amortization are non-cash in nature, they will not affect the group’s operating profit or cash flow. The group’s financial position and cash flow remain robust, with continued optimization of its debt structure.

Excluding the impact of the above-mentioned one-time non-cash expenses, the board expects adjusted non-IFRS net profit—EBITDA after adjusting for goodwill impairment, non-current asset impairments, and deferred income reversal—to range between RMB 170 million and RMB 200 million for the 2025 fiscal year.