Yuyuan Co., Ltd. Responds to Shanghai Stock Exchange Regulatory Letter, Providing Detailed Explanation on 2025 Performance Loss Forecast and Asset Impairment Reasons

Zhongfang Network Data
Shanghai Yuyuan Tourism Mall (Group) Co., Ltd. (Stock Code: 600655) announced on March 17, 2026, that it has responded in detail to the regulatory letter from the Shanghai Stock Exchange regarding its 2025 performance forecast. The company expects a net profit attributable to shareholders of approximately -4.8 billion yuan in 2025, with a non-recurring net profit of about -4.7 billion yuan. The significant decline in performance is mainly due to large asset impairment provisions.

The announcement shows that the main reasons for the performance change are:

1. Real estate project impairments: Affected by deep industry adjustments, the company accelerated inventory clearance to recover funds, leading to a decrease in sales prices and gross profit margins, and recognized inventory impairment provisions of about 1.56 billion yuan for some real estate projects showing signs of impairment.
2. Fair value changes in investment properties: Due to supply and demand changes in the leasing market, some leased properties faced pressure on occupancy rates and rental levels, resulting in an estimated reduction of about 760 million yuan in fair value of investment properties.
3. Goodwill impairment: Due to changes in the market environment of certain asset groups and intensified competition, future operating performance fell short of expectations, leading to an estimated goodwill impairment of about 150 million yuan.
4. Land reserve losses: The company’s joint venture with Kunming Fudi on a commercial land parcel reached an agreement with the government, resulting in an estimated loss of about 670 million yuan.

The company analyzed the reasons for the decline in performance across various business segments:

• The complex functional real estate business was affected by declines in sales area and sales revenue nationwide;
• The commercial operation segment faced oversupply and downward pressure on rental prices;
• The cultural and dining business experienced sluggish growth amid intensified industry competition;
• The jewelry and fashion business was impacted by high gold prices suppressing consumer demand and industry structural differentiation.

In response to regulatory inquiries, the company provided detailed explanations of the valuation process, key parameters, and inventory impairment testing basis for investment properties over the past three years. It emphasized that the impairment provisions are consistent with industry trends and actual project operations, and that sufficient provisions were made in previous years. Regarding goodwill impairment, the company compared the testing parameters over the past three years and noted that the differences mainly stem from uncontrollable external risks (such as overseas emergencies) and the company’s strategic adjustments not meeting expectations.

Yuyuan Group stated that it is actively promoting cost reduction, efficiency improvement, and lean operations strategies through refined management, product innovation, and global expansion to strengthen long-term value. The performance forecast data is unaudited, and the final financial data will be based on the audited 2025 annual report officially disclosed by the company.