Shanghai XNG (03666) has issued an announcement addressing the fluctuation in its share price on the Hong Kong Stock Exchange on February 10, 2026. After making reasonable inquiries under the circumstances, the Board of Directors confirmed it is unaware of any reasons for the price volatility, aside from the details disclosed below. Furthermore, the Board stated it has no knowledge of any information requiring disclosure to prevent a false market in the company's shares or any inside information necessitating disclosure under Part XIVA of the Securities and Futures Ordinance.
The Board noted a news article published by a local media outlet on February 10, 2026, which reported that all restaurants operated by the company under the "Shanghai XNG" brand in Shanghai had closed. The Board wishes to clarify that operations at the ten Shanghai XNG-branded restaurants currently owned by the company have been temporarily suspended as part of the Group's strategic restructuring.
Additionally, the Board clarified that the statement in the article claiming "deposits and prepaid cards are non-refundable" is incorrect. The company is currently processing refunds for customer deposits. Funds for prepaid cards are held in designated guarantee accounts and are available for refund. The Board members remain committed to ensuring all deposits and prepaid cards are properly refunded to customers.
The Board believes the strategic restructuring is part of the Group's ongoing portfolio realignment. It is a strategic measure to streamline operations and reallocate resources to core markets. The suspension of operations reflects the continued lack of profitability in the Mainland China catering business and aims to reduce financial losses in a challenging operating environment. This move is part of a broader plan expected to enhance operational efficiency, improve product and service quality, and reduce costs.
The Group remains committed to demonstrating resilience and adaptability in the current economic climate. Operational resources will be strategically reallocated to more profitable market segments to capitalize on opportunities for sustainable growth. Looking ahead, the Group will focus on improving resource allocation efficiency and implementing a brand revitalization plan involving comprehensive business restructuring. The goals are to enhance affordability, strengthen profit margins, and build a more dynamic and accessible brand image aligned with evolving consumer preferences.
The Board believes the strategic restructuring is in the best interests of the Group and its shareholders. The article contained no other information requiring notification to The Stock Exchange of Hong Kong Limited or the company's shareholders.