Hong Kong-focused Forex broker CLSA Premium Ltd (HKG:6877), formerly known as KVB Kunlun, has issued a profit warning.
The Group is expected to record a net loss approximately HK$57 million for the year ended 31 December 2021 (FY2021), as compared with the audited net loss of HK$72 million for the year ended 31 December 2020.
The expected result is mainly attributable to the combined effects of a number of factors, such as:
- decrease in total income due to the drop in revenue generated in New Zealand as a result of the additional licence conditions imposed by the Financial Markets Authority of New Zealand;
- the Group recorded net foreign exchange gain for FY2021 as compared to the net foreign exchange loss as recorded for FY2020; and
- the non-recurring tax refund received from the Inland Revenue of New Zealand in relation to the COVID-19 measures.
As at the date of this announcement, the Group is still in the process of finalising its results for FY2021. The information is only based on a preliminary assessment by the Board.
In the first six months of 2021, CLSA Premium’s net losses widened in line with the Group’s own forecasts.
Total income decreased by approximately 42% to HK$3.80 million from HK$6.55 million a year earlier. The leveraged FX and other trading income of the Group decreased by approximately 42% to HK$1.29 million for the 2021 Interim Period from HK$2.23 million for the 2020 Interim Period, mainly caused by the reduced profit opportunities under the low market volatility.