The board of directors of Linocraft Holdings Limited announced that, based on the Group's draft unaudited consolidated management accounts for the year ended 31 August 2017, the Group is expected to record a loss for Year 2017 as compared to the profit for the year ended 31 August 2016. The loss was mainly attributable to the following reasons as disclosed in the prospectus: a decrease in gross profit as the gross profit margin decreased from 22% in Year 2016 to 16% in Year 2017; the recognition of one off listing expense for Year 2017; start­up operation cost for Philippine subsidiary; and an increase in distribution cost due to transportation of products to fulfil orders of the contract manufacturer of Company D in the Philippines. Excluding the impact of one-off listing expenses, the net profit (adding back the one-off listing expense to the net loss) attributable to the owners for Year 2017 would have decreased by approximately 60% as compared to Year 2016.