Wei Qiao Textile (02698): Expected Medium-Term Performance Is Lower Than The Same Period

According to its unaudited management accounts, the 02698.HK announced that the interim performance of the group for the 6 months ended June 30, 2019 will be significantly lower than that of the same period in 2018, mainly due to:

(1) despite the steady operation of the group's electricity business in the first half of 2019, the global economic growth is weak and market consumption is weakened due to the unfavorable factors such as the warming of trade protectionism. The demand for China's cotton textile market is weak, and the entire textile industry is under pressure, which has a negative impact on the gross profit margin and gross margin of the group.

(2) in the first half of 2019, the group continued to improve employee benefits and further raise staff salaries, resulting in an increase in staff costs in the group compared with the same period last year.