[ET Net News Agency, 20 July 2021] Sprocomm Intelligence Limited (01401) said the group
expects that it will record a net loss of not less than RMB20 million as opposed to a net
profit of RMB12.6 million for the six months ended 30 June 2020.
The expected net loss was mainly attributed to (i) the increment in the costs of raw
materials (in particular mobile chips and screen for the mobile devices) in the first half
of 2021 driven by the global shortage of electronic components. As a result, the group's
overall gross profit margin for the six months ended 30 June 2021 is expected to decrease
to approximately 7.5% as compared with approximately 10.1% for the six months ended 30
June 2020; (ii) the increase in research and development expenses by approximately 15% to
approximately 30% as the group devoted more resources into the research and development of
own-branded products and IoT-related products; and (iii) the increase in contributions to
retirement benefits scheme for the group's employees by more than 100% as micro, small and
medium size enterprises enrolled in China Social Security Schemes were exempt from making
employer contributions to pension, unemployment and work-related injury insurance schemes
between February and June 2020. (RC)