Zhixin Group Holding Limited (2187) released an update highlighting the resignation of its previous auditor, PwC, and the appointment of Crowe as the new auditor at an annual audit fee of RMB1.50 million. The original PwC proposal included a fee of RMB2.70 million for the 2025 audit, representing a 22.70% rise from the RMB2.20 million fee for 2024. After considering concerns about cost and business scale, the board resolved to change auditors.
Zhixin Group indicated that Crowe’s proposed fee reflects a risk-based approach, with resources allocated primarily to areas in the PRC where operational activities occur. The new engagement duties emphasize reviews of revenue, trade receivables, property, plant and equipment, and goodwill, with an eight- to ten-person team to complete fieldwork from December 2025 to early 2026. The audit committee confirmed that Crowe’s plan, timetable, and qualifications are aligned with the company’s requirements.
The announcement also discusses business expansions in 2025, notably in Hainan, where Zhixin Group enhanced its production line for comprehensive use of iron ore tailings and began constructing a new facility. Despite a 6.40% increase in total revenue to RMB259.70 million for the six months ended 30 June 2025, the company recorded a net loss of RMB49.10 million, compared with a RMB1.20 million profit for the same period in 2024. Gearing ratio rose to 54% from 48%. The ready-mixed concrete and precast concrete components segments saw declining profitability, while the iron ore tailings recycling and eco-friendly bricks segment in Hainan showed revenue growth.
Management stated that capital investments have increased to RMB451.80 million as of 30 June 2025, mainly attributable to the construction of a new production line in Hainan and plans to develop a factory in Longyan. Total assets were RMB1,129.80 million as of 30 June 2025, with property, plant and equipment climbing to RMB456.30 million from RMB412.30 million at the end of 2024. Directors noted that most expansion projects have not contributed revenue yet, so the company’s business nature and complexity remained relatively constant. Crowe will focus on conducting thorough audits of these developments and on evaluating the impairment of non-current assets in other segments.
The board and audit committee consider the appointment of Crowe, and the related resource allocation plan, sufficient to maintain high-quality audits and address the group’s risk areas in a cost-effective manner. The announcement was published on 26 February 2026.
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