Elite Exchange Group (01775) expects the comprehensive profit attributable to owners for the first 10 months to be approximately HK$12.9 million, turning a year-on-year loss into profit

According to Zhitong Finance App News, Elite Exchange Group (01775) announced that it is expected that the unaudited comprehensive profit due to the company owner for the ten months ending May 31, 2026 is about HK$12.9 million. The loss due to company owners for the same period in 2025 is about HK$11.2 million, which successfully turned a loss into a profit, with an improvement of about HK$24.1 million. Losses for the same period in 2025 were mainly due to (i) the Group's significant expansion of professional teaching and administration teams to enhance educational quality and operational capacity, leading to higher employee-related costs; (ii) significant investment in research and development of specialized courses and learning materials customized for international courses and assessments to ensure academic excellence and competitive advantage; (iii) huge expenses generated by targeted marketing aimed at strengthening the brand and further entering the mainland China market; and (iv) loss of financial assets recorded at fair values for profit and loss.

Continuing the positive momentum shown by the Group's interim results for the six months ended January 31, 2026, the Group maintained revenue growth over the next four months and continued to achieve ideal operating performance. The main reason for turning a loss into a profit for the ten months ended May 31, 2026 was the continued strong growth momentum of operations and the gradual increase in earnings based on the company's basic investments made during the past period. The main contributing factors include (i) a significant increase in the number of students enrolled in partner institutions that demand the company's school services in mainland China, reflecting continued demand for HKDSE-related education services; (ii) strong revenue growth in the company's supplementary education services and products; and (iii) for the four months ended May 31, 2026, the company's private high school day schools and private secondary school supplementary education services further contributed to revenue. This performance proved that the Group successfully planned the scale of operations and was able to effectively monetize this after improving teaching resources and courses. It is in line with the growth trend shown in the first half of the fiscal year ending July 31, 2026.

It is worth noting that the Group's operations are seasonal. Most of the Group's students are recent Secondary 6 candidates, and the courses they are enrolled in usually end before the March Public Examination. Additionally, other senior students usually reduce their participation in our courses at the end of the school year. As a result, the Group's earnings in June and July were generally lower than and generally likely insufficient to fully cover operating costs, resulting in operating losses and net cash outflows during those months.