Core Viewpoint - The company, Huakong Kante (01312.HK), reported a significant increase in net loss for the six months ending June 30, 2025, primarily due to challenges in its fitness franchise business and economic uncertainties [1] Financial Performance - The group's revenue and gross profit for the period were approximately HKD 452.7 million and HKD 254.6 million, representing a decline of about 1.3% and 8.1% respectively compared to the same period in 2024 [1] - The net loss for the group was approximately HKD 321.4 million, a substantial increase from a net loss of approximately HKD 4.5 million in 2024 [1] - Basic loss per share was approximately HKD 5.06, compared to earnings of approximately HKD 0.09 per share in 2024 [1] Business Challenges - The increase in net loss was attributed to a series of changes in the performance of the fitness franchise business, which faced slow recovery due to economic uncertainties and intensified competition [1] - The company's joint venture operating in Taiwan encountered operational difficulties and financial constraints, contributing to the financial losses [1] Impairment Losses - The group recorded significant impairment losses, including: - Expected credit loss model impairment of financial assets amounting to approximately HKD 159.0 million, compared to HKD 25.5 million in 2024 [1] - Impairment loss on intangible assets of approximately HKD 123.9 million, compared to HKD 13.6 million in 2024 [1] - Goodwill impairment loss in the fitness business segment of approximately HKD 88.4 million, whereas there was no such loss recorded in 2024 [1]