On March 15, GLONGHUI announced to China International (01871.HK) that compared with a net loss of approximately RMB 8.7 million for the year ended December 31, 2022, the Group expects to record a net loss of approximately RMB 7.0 million to approximately RMB 8.5 million for the year ended December 31, 2023.
According to the Board of Directors, the main reasons for this reduction in losses are as follows: (I) the Group's revenue from the driving training service business for large vehicles and small vehicles has declined due to continued deterioration in the market conditions in the logistics industry due to continued strained trade relations between China and the US, which led to (i) an overall decrease in the average hourly course fee for driving courses for large vehicles and small vehicles; and (ii) the overall reduction in the number of students attending driving courses for the year ended 31 December 2023 and the actual number of training hours for large vehicles and small vehicles provided by the Group. In particular, it had a significant impact on the number of students enrolled in courses for large vehicles; (II) the overall decline in gross profit and gross margin of the Group's driving training service business, mainly due to an increase in the gross margin of small vehicle driving courses due to increased revenue from course fees that were confiscated after attending the driving course, but the average hourly course fee as well as the number of students attending the driving course and actual training hours were reduced overall, as well as fixed depreciation costs for training sites and training vehicles and amortization of usage rights assets; this (III) reduction was due to the above decrease from 2023 The reduction in sales and marketing and promotion activities for the year ended 31 December and the reduction in employee benefit expenses for executive staff were partially offset by a decrease in sales and marketing expenses and administrative expenses for the year ended 31 December 2023 compared to the year ended 31 December 2022, respectively.