According to the Zhitong Finance App, Lianhua Supermarket (00980) issued an announcement. Shanghai Lianjia Supermarket Co., Ltd. (Lianjia), a joint company of the company, approved confirmation of the expected credit losses of some non-trade financial assets after considering the operating losses and financial conditions of its affiliates.

In view of the calculation of expected credit losses from joint non-trade financial assets mentioned above, the Group expects to incur significant losses during the 12-month period ending December 31, 2023, mainly due to joint venture's share of losses. After excluding Lianjia's normal operating losses, Lianjia has already calculated significant anticipated credit losses on its non-trade financial assets, mainly related parties. The credit impairment of such financial assets is mainly due to financial difficulties experienced by the joint venture's related parties, and there are no realistic prospects for recycling. Therefore, during the 12-month period ending December 31, 2023, the Group will confirm that the joint venture's share of losses is approximately RMB 367 million in profit and loss in accordance with the equity law, and the net assets will be reduced accordingly.