"Profit Alert" SUNAC SERVICES forecasts first-half profit not less than 100 million RMB

SUNAC SERVICES (01516.HK) issued a profit warning, expecting a profit of no less than 100 million RMB for the six months ending in June, compared to a loss of 472 million RMB in the same period last year. This is mainly due to a significant reduction in the impairment provision for receivables from related parties. However, it is anticipated that gross profit and gross profit margin will decrease, as the group has deferred recognizing revenue from several third-party clients whose performance obligations have been completed but have high risks of collection, as well as increased maintenance costs due to the expiration of warranty for projects delivered in recent years