The board of directors of Leoch International Technology Limited provided earnings guidance for the six months ended 30 June 2022. The Company based on the preliminary review of the latest management accounts of the Group, it is expected that there would be an increase in the revenue of the Company of more than 15% and the profit attributable to owners of the Company for the Interim Period is expected to be more than doubled as compared to the corresponding period of last year. Such increase is primarily attributable to the gain on foreign exchange for the Interim Period as compared to the net foreign exchange loss for the corresponding period of last year.

Despite the foregoing, the gross profit margin of the Group has decreased as compared to the corresponding period of last year, suppressing the profit growth of the Group in the Interim Period. This decrease is primarily attributable to the increase in distribution costs in the business operations of the Group, including escalating shipping rates for containers and delivery charges, distribution expenses and other supply chain costs and expenses, which have increased considerably during the Interim Period due to the lingering impact of the COVID-19 pandemic around the world which was worsened by the Russo-Ukrainian War and the temporary lockdown since March 2022 in multiple cities of China.