Tianhong Textile (02678. HK) Expects Annual Net Profit To Decrease By About 45% Year On Year

According to the announcement of Tianhong textile (02678. HK), according to the preliminary assessment of the group's unaudited comprehensive management accounts for the year ended December 31, 2020 and the information currently available to the board of directors, it is expected that in the year ending December 31, 2020, compared with the group's net profit of about 922 million yuan as of December 31, 2019, the net profit of the group will significantly regress by about 45%.

Due to the global outbreak of new coronavirus pneumonia and weak consumer confidence, the board of directors expected that the group's annual performance would be affected. Nevertheless, the overall textile market, especially in China, continued to stabilize and recover in the fourth quarter of 2020, while the prices of raw materials including cotton and synthetic fiber also rebounded. As a result, the group's overall revenue in 2020 is less than 15% lower than that in 2019 and about 20% less than originally expected. At present, the board of directors is of the view that the overall textile market has returned to a relatively normal state, except that overseas demand for woven fabrics has not yet recovered.