Analyst Summary
- OneConnect Financial Technology Co., Ltd. issued a profit warning for the year ended December 31, 2024, anticipating an increased net loss.
- The increased loss is primarily attributed to an increase in impairment losses of goodwill (approximately RMB120 million to RMB150 million) and a reversal of deferred income tax assets (approximately RMB440 million to RMB470 million).
- The discontinuation of cloud services, as announced on July 11, 2024, has contributed to a year-on-year revenue decline.
- The expected net loss from continuing operations is projected to be approximately RMB645 million to RMB705 million for FY2024, compared to RMB211.3 million for FY2023.
- A one-time gain of approximately RMB260.1 million from the disposal of virtual banking business will partially offset the increased losses.
- The overall net loss is expected to increase from RMB371.5 million for FY2023 to approximately RMB435 million to RMB495 million for FY2024, considering both continuing and discontinued operations.
- The profit warning statement constitutes a profit forecast under the Takeovers Code and is subject to reporting by the Company’s independent financial adviser and auditors.
- A preliminary non-binding proposal for the possible privatization of the Company by Bo Yu Limited was received on March 1, 2025, which could result in delisting from the Stock Exchange and the New York Stock Exchange.