On June 24th, Gelunhui reported that Yuanheng Gas (00332.HK) expects to record: (a) a decrease of about RMB 74.46 million in total operating revenue compared to the previous fiscal year; (b) a decrease of about RMB 2.51 million in gross profit compared to the fiscal year 2022-23; (c) the Company's shareholders are expected to have a loss of about RMB 16.5 million in the fiscal year 2023-24, while the Company's shareholders had a profit of RMB 2.7 million in the fiscal year 2022-23; and (d) a significant loss of about RMB 17.1 million in the fiscal year 2023-24, compared to a loss of about RMB 2.8 million in the fiscal year 2022-23.

The Board of Directors believes that: (i) the total operating revenue and gross profit have decreased, mainly due to the continued decline in the average selling price of global natural gas and petroleum products, which serve as the source of raw materials for the Group's products and the reference for the selling price of processed products. This has put pressure on the Group's gross margin, making it difficult for the Group to reduce fixed costs of operating; on the other hand, the Group's other business segments (pipeline natural gas sales division) have not yet resumed operations since the Board of Directors has not made any significant progress or settlement with its trading counterparty and Chinese government agencies; and (ii) in addition to the factors that will lead to a decrease in total operating revenue and gross profit and an increase in the Company's shareholders' loss and Group's loss, there is also an increase due to the significant increase of about RMB 15.6 million in bad debt loss on trade receivables expected to be confirmed according to the expected credit loss model for fiscal year 2023-24 (about RMB 0.13 million for fiscal year 2022-23). The reason is that as of March 31, 2024, the trade receivables have already matured but have not been paid back.