Leading Holdings Group Limited provided consolidated earnings guidance for the year ended 31 December 2022. For the year, the company expects to record a net loss ranging from approximately RMB 4.8 billion to RMB 5.5 billion as compared to the net profit of RMB 636,749,000 for the year ended 31 December 2021. Based on the information currently available, such expected loss was primarily due to the significant decrease in the gross floor area of property projects delivered and the lowered gross profit margin during the Reporting Period, as a result of multiple factors such as the recurrence of the COVID-19 pandemic, the macroeconomic downturn and the continued depletion of demand in real estate properties; the adverse market sentiment and the wait- and-see position cautiously taken by customers.

Although policies favourable to the real estate industry have been introduced and the Company has actively taken price reduction and promotion measures to boost property sales, property sales were still less than expected. Therefore, taking a prudent approach, the Company will recognize an increased impairment loss for properties under construction and completed properties held for sale during the Reporting Period; and there being a fair value losses on investment properties, as a result of the increased rate of vacancy of investment properties and the reduction in the amount of rent received due to the macroeconomic downturn caused by the recurrence of the COVID-19 pandemic.