HENG TAI (00197) has announced that, compared to the previous financial period, it expects its unaudited consolidated financial results for the six months ending December 31, 2025, to record an approximate 34% decrease in revenue and an approximate 52% decrease in gross profit. The board of directors noted that the group's operating environment remains challenging due to several factors: (i) the ongoing drag on the economy from the real estate and debt crises, leading to weak market demand; (ii) persistent uncertainty from unpredictable foreign trade policies of major nations, continuing to suppress global economic growth and international trade; (iii) intensified market competition, as domestic brands engage in fierce competition through low-price strategies and extensive advertising campaigns; and (iv) continuously rising procurement costs, which the group has been unable to pass on to customers due to the competitive market landscape. Against this backdrop, the group has strategically scaled back certain unprofitable imported goods trading businesses to reduce operational costs and expenses. Furthermore, to maintain competitiveness in the challenging market, the group has been unable to increase selling prices for imported fast-moving consumer goods and agricultural products, despite rising procurement costs. Consequently, both revenue and gross profit declined across all business segments for the six months ending December 31, 2025. Despite the decreases in revenue and gross profit mentioned above, the board expects the group to report a net loss of approximately HK$33.4 million for the six-month period, which represents an improvement of about 13% compared to the results from the previous financial period. The primary reason for the reduced net loss is a net fair value gain on investments of approximately HK$3.8 million, which was not realized in the prior period. Additionally, the group has successfully implemented several cost-reduction measures, including streamlining unprofitable goods trading operations as mentioned, leading to a combined decrease in selling, distribution, and administrative expenses of about 19% compared to the previous financial period. However, given the current uncertain economic climate, the group continues to adopt a prudent approach towards receivables with higher collection risks. As a result, the board anticipates an impairment loss on receivables and other receivables of approximately HK$5.7 million for the six months ending December 31, 2025.