Gelonghui, March 6, | Victoria Harbour Environmental Technology (01845.HK) announced that it is expected that the profit/loss attributable to the company owner will be recorded in the year ending December 31, 2023, approximately between profit of RMB 3 million and loss of RMB 2 million. Compared with the loss of RMB 72.3 million recorded in the same period of 2022, losses have decreased or turned losses into profits. The reduction in losses or the conversion of losses into profits is mainly due to the following factors:
(i) Compared with the total loss of approximately RMB 37.8 million due to depreciation of the Qingchuan anaerobic cracking project, battery cathode sheet project inventory and Qingyang Qingyi project for the year ended 31 December 2022, it is expected that an impairment of approximately RMB 3.9 million will be recorded in the year ended 31 December 2023;
(ii) Stricter cost control measures have been implemented to increase the Group's overall gross margin from about 18.7% for the year ended 31 December 2022 to about 24.3% for the year ended 31 December 2023, and achieved a cost reduction of approximately RMB 13.5 million; and
(iii) Compared with impairment losses of approximately RMB 15.5 million in accounts receivable and contract assets for the year ended 31 December 2022 based on the expected credit loss model, it is expected that an impairment provision of approximately RMB 3.6 million will be recorded in the year ended 31 December 2023.