Kidztech FY2025 Net Loss Expands 35.4% to RMB 82.72 Million as Margins Erode; Auditor Flags Going-Concern Risk

Bulletin Express03-31

Kidztech Holdings Limited (Kidztech, 06918) released audited results for the year ended 31 December 2025.

Revenue and Margins • Revenue slipped 1.2% year on year to RMB 216.16 million, reflecting the exit from the low-margin raw-materials trading business and softer sales of smart toy vehicles. • Gross profit fell 23.7% to RMB 13.98 million; gross margin narrowed to 6.5% from 8.4% in FY2024, driven by a deliberate low-margin pricing strategy to penetrate emerging Asian markets.

Profitability • Net loss widened 35.4% to RMB 82.72 million (FY2024: RMB 61.08 million), mainly due to a RMB 22.50 million surge in impairment losses on trade and other receivables. • Basic and diluted loss per share increased to RMB 0.124 from RMB 0.098.

Operating Expenses • Selling expenses rose to RMB 0.46 million (FY2024: RMB 0.01 million) on higher logistics and marketing costs. • Administrative expenses declined 15.9% to RMB 28.25 million following staff-cost reductions.

Balance-Sheet Metrics • Cash and cash equivalents stood at RMB 7.52 million (31 Dec 2024: RMB 10.71 million). • Total borrowings increased to RMB 133.26 million; gearing ratio climbed to 61.2% (31 Dec 2024: 44%). • Current ratio eased to 1.2 (31 Dec 2024: 1.4); quick ratio fell to 1.1. • Net assets contracted to RMB 217.72 million from RMB 285.88 million. • Trade receivables dropped to RMB 231.04 million after an enlarged expected-credit-loss allowance; average receivable days were 449 (FY2024: 457).

Capital Structure and Post-Balance-Sheet Event • Issued share capital rose to 749.48 million shares by year-end. • On 2 March 2026, 124.91 million shares were issued upon HK$20 million bond conversion, enlarging the share base to 874.39 million shares.

Auditor’s Emphasis Independent auditor McMillan Woods highlighted a material uncertainty related to going concern, citing the FY2025 loss, limited cash (RMB 7.52 million) and sizable short-term borrowings (RMB 133.26 million).

Dividend No final dividend was declared.

Strategic Focus Management plans to deepen overseas sales, broaden its customer mix via Hong Kong export-oriented wholesalers, accelerate smart product development, and outsource portions of production to lift efficiency.

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