Chinese tea chain Nayuki expects adjusted net loss of almost 1b yuan

Chinese fruit tea chain Nayuki (2150) expects to log an adjusted net loss of up to nearly 1 billion yuan (HK$1.07 billion) for 2024 amid a weak consumption market and intensified competition.

The drink maker is estimated to record an adjusted net loss of between 880 million yuan and 970 million yuan for 2024, in sharp contrast to an adjusted net profit of 20.9 million yuan in 2023. 

Revenue is projected to range from 4.8 billion yuan to 5.1 billion yuan, representing a decline of between 1.2 percent and 7 percent from 5.16 billion yuan a year earlier.  

During the year, consumers leaned toward cautious spending or purpose-based spending, which together with fierce competition in the freshly-made tea industry led to fluctuations in revenue from the firm’s self-operated stores and the store-level operating profit margin, the company said in a filing on Friday. 

Nayuki also closed down a number of underperforming stores in the year, which resulted in a loss on closure of stores. It will continue to shut down or transform underperforming stores, for which a provision for asset impairment has been made, the filing said.

Nayuki’s shares dropped by 5.2 percent to HK$1.64 on Friday before the profit warning was released. 

The stock rocketed more than 60 percent in two days last month after its chief operation officer resigned. It was still up by 23 percent compared to the price prior to the resignation announcement. 

Still, the equity has tumbled more than 90 percent since its listing in 2021. 

STAFF REPORTER