MAOYE INT'L (00848) has issued a profit warning, forecasting a net loss of approximately RMB 120 million to RMB 180 million for the first half of 2026. This marks a significant reversal from the net profit of around RMB 11.92 million recorded in the same period of 2025.

Excluding the impact of an estimated RMB 125 million in fair value impairment losses on investment properties and approximately RMB 45 million in goodwill impairment losses, the company expects an operating net loss of between RMB 8 million and RMB 38 million for the first half of 2026.

The company attributed the anticipated loss to a challenging macroeconomic environment that has pressured main business performance. The department store retail sector remains in a phase of bottoming out and adjustment, compounded by weak consumer spending and declining average transaction values, which have reduced revenue and squeezed net profit.

During the reporting period, MAOYE INT'L closed several stores, including outlets at Inner Mongolia Victoria Times Square and Qinhuangdao Modern Shopping Plaza, after failing to reach an agreement on lease terms with the relevant parties. These closures led to a year-on-year revenue reduction of approximately RMB 94.28 million and a net profit decrease of about RMB 31.35 million.

In accordance with accounting policies and a cautious approach, the company management has decided to record an estimated RMB 125 million impairment loss on the fair value of investment properties and an additional RMB 45 million impairment loss on goodwill for the period.