Chiho Environmental Group Limited (“Chiho”) reported an unaudited net loss of HK$1.52 billion for FY-2025 (FY-2024: HK$234.10 million loss), after recognising a HK$1.27 billion loss from discontinued operations triggered by the mid-year deconsolidation of its European arm, the Scholz Group, and the lubricating-oil business.

Operating performance – continuing operations • Revenue from the residual Asian metal-recycling operations fell 29.0% to HK$992.40 million, reflecting weaker regional commodity demand and the closure of the loss-making Thailand unit. • Gross profit inched up 1.9% to HK$31.90 million; margin improved to 3.2% (2024: 2.2%) following the exit from Thailand. • Administrative and selling expenses rose 15.8% to HK$168.20 million, driven mainly by higher legal and professional fees. • Net finance costs widened to HK$108.90 million (2024: HK$80.10 million) amid default interest on a US$50 million syndicated term loan that fell due on 30 March 2024. • Loss from continuing operations attributable to shareholders deepened to HK$259.70 million (2024: HK$177.50 million).

Discontinued operations • The Scholz Group, deconsolidated on 14 May 2025 after receivers were appointed over key holding entities, contributed revenue of HK$5.05 billion in the four-month period to 30 April 2025 but booked a HK$1.44 billion deconsolidation loss. • Including a HK$55.60 million operating profit up to deconsolidation and a HK$116.90 million currency translation gain, the net impact was a HK$1.27 billion loss. • The lubricating-oil business, over which control was lost in 2024, had no impact in 2025 (2024 loss: HK$45.60 million).

Balance sheet and liquidity • Total assets contracted to HK$5.00 billion (2024: HK$7.87 billion) after reclassifying HK$4.13 billion of Scholz-related interests to “financial assets at FVTPL”. • Shareholders’ equity fell 30.5% to HK$3.08 billion; net asset value per share dropped to HK$1.92 (2024: HK$2.76). • Cash and cash equivalents stood at HK$102.50 million (2024: HK$414.80 million). • All borrowings (HK$525.50 million) are current; the syndicated term loan (HK$389.20 million) remains in default but was subsequently settled in July 2026 using proceeds from the receivers’ sale of Scholz. • Current ratio improved to 2.37 (2024: 1.28) owing to the FVTPL reclassification; gearing eased to 10.6% (2024: 15.2%).

Going-concern assessment Management expects the post-balance-sheet receipt of US$334 million (HK$2.60 billion) from the Scholz disposal in September 2026 to bolster liquidity and meet obligations over the next 12 months. The Board therefore prepares the accounts on a going-concern basis.

Capital expenditure and commitments FY-2025 capex declined to HK$33.80 million (2024: HK$123.80 million). No material new capex commitments were outstanding at year-end.

Dividend The Board proposed no final dividend (FY-2024: nil).

Litigation and contingent matters Key proceedings include ongoing appeals in the “Delco” claim, employee litigation, lease disputes with Hong Kong Science and Technology Parks Corporation, and actions related to forged documents at a 60%-owned subsidiary. Management states these matters are not expected to materially affect operations.

Resumption status Trading in Chiho’s shares (stock code 00976) has been suspended since 1 April 2025. The Stock Exchange has set multiple resumption conditions, including completion of a forensic investigation, internal-control overhaul, publication of audited results, and demonstration of compliance with Listing Rules. Ernst & Young Advisory Services has been engaged to finalise the investigation and internal-control review; draft reports were submitted on 29 September 2026.

Outlook Management aims to deploy the Scholz sale proceeds to reinforce working capital, stabilise Asian recycling operations and evaluate expansion opportunities. The Board remains focused on improving operational efficiency and navigating macro-economic headwinds while addressing regulatory and governance requirements essential for trading resumption.