Nine Dragons Paper Shares Fall After Warning of 1H Loss

Nine Dragons Paper Shares Fall After Warning of 1H Loss

Nine Dragons Paper Holdings Ltd. shares fell early Monday after the company warned of a first-half net loss.

Shares of the Hong Kong-listed paper product manufacturer fell as much as 8.6% to 6.28 Hong Kong dollars (US$0.80). They were last 7.0% lower at HK$6.39.

Net loss for the first half of the year is expected to range between CNY1.25 billion (US$184.5 million) and CNY1.45 billion, it said in a filing late Friday, citing higher production costs due to the Russia-Ukraine conflict.

The company also said that it expected a “significant decrease” in its gross profit margins in the first half.

While a first-half loss was widely expected by the market, the net loss warning was slightly worse-than-expected, Citi analysts Eric Lau and Alice Cai said in a research report.

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