The AUTOMATED SYS (ASX: 00771) group has announced an expected net loss attributable to its owners in the range of approximately HK$290 million to HK$310 million for the first half of 2026. This contrasts with a net profit attributable to owners of HK$41.5 million recorded in the same period of 2025.

The board attributes the anticipated loss for the period primarily to a non-cash expense net amount expected to be recognized concerning the group's interest in its associate, Grid Dynamics Holdings, Inc. (GDH).

Based on a preliminary impairment assessment conducted by the company, a significant decline in the market price of GDH shares during the period has resulted in the reported market value of the group's interest in GDH (determined with reference to GDH's closing share price as of June 30, 2026) being substantially lower than the carrying value of this investment in the group's consolidated financial statements.

Consequently, the group expects to recognize an impairment loss on its interest in this associate. This impairment loss is anticipated to be partially offset by the reversal of a previously recognized deferred tax liability related to this investment.

After considering the expected tax impact, the net adverse effect on the group's profit or loss for the period is currently projected to be between approximately HK$485 million and HK$505 million.

The board emphasizes that the aforementioned expected impairment loss is a non-cash accounting item and will not affect the group's robust cash position or the stability of its daily operations.