On the evening of July 3, Meitu Company (01357.HK) announced on the Hong Kong Stock Exchange that it expected to record a net loss of approximately RMB 274.9 million to RMB 349.9 million in the first half of the year, an increase of approximately 99.6% from the same period in 202

On the evening of July 3, Meitu company (01357.HK) announced on the Hong Kong Stock Exchange that it expected to record a net loss of approximately RMB 274.9 million to RMB 349.9 million in the first half of the year, an increase from the same period in 2021. Approximately 99.6%-154.1%. The main reason for the expected increase in net loss is the impairment of purchased cryptocurrency.

The Board of Directors would like to inform shareholders and potential investors that based on the impairment of purchased cryptocurrencies; and a preliminary review of the Group’s unaudited consolidated management accounts for the five months ended May 31, 2022, it is expected that the Group will The Group may record a net loss of approximately RMB274.9 million to RMB349.9 million for the six months ended June 30, 2021 (compared to approximately RMB137.7 million for the six months ended June 30, 2021 Yuan's net loss increased by approximately 99.6% to 154.1%). The main reason for the expected increase in net loss is the impairment of the cryptocurrency purchased by . The

announcement mentioned that in three announcements in 2021, it was announced that the group had purchased a total of approximately 31,000 units of Ethereum and approximately 940.89 units of Bitcoin, with a total consideration of approximately US$50.5 million and US$49.5 million respectively.

Since the purchase of the Cryptocurrency, the Group has not purchased or sold any Cryptocurrency (including any Ethereum or Bitcoin) under the Cryptocurrency Investment Plan. As of June 30, 2022, the fair values ​​ of purchased Ethereum and of purchased Bitcoin, determined based on the then market prices, were approximately US$32.0 million and US$18.0 million respectively. In accordance with International Financial Reporting Standards , the Group expects to recognize impairment losses of approximately 18.5 million in respect of purchased Ethereum and purchased Bitcoin in the Group's upcoming interim results for the six months ending June 30, 2022. million and approximately US$27.1 million.

This is not the first time that Meitu has suffered losses due to currency speculation. According to previous reports, Meitu's financial report for the first half of 2021 showed that the net loss in the first half of that year was 129 million yuan, a year-on-year increase of 708.6%; the net loss increased significantly to 137.7 million yuan, a year-on-year increase of 450.8%. The significant increase in net loss was primarily due to an increase in one-time expenses resulting from a decrease in the fair value of impaired purchased cryptocurrencies.

As of the close of trading on June 30, Meitu fell 0.95%.

Source: Read Chuang Finance Comprehensive

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