Arts Optical International Holdings Limited provided group earnings guidance for the six months ending June 30, 2017. The board of directors of the company inform the shareholders of the company and potential investors that based on the company's preliminary review of the results of the group for the five months ended 31st May, 2017, the group is expected to record a substantial loss for the six months ending 30th June, 2017. The loss of the group for the six months ended 30th June, 2016 was HKD 321.1 million, which was mainly attributable to the net economic compensation for past service to the employees of the group of HKD 286.6 million which was recognized as an administrative expense. If this one-time expense was excluded, the loss of the group for the six months ended 30th June, 2016 would be reduced to HKD 34.5 million (the Adjusted Loss). The board anticipates that the group will report a substantial increase in loss for the six months ending 30th June, 2017 in comparison to the adjusted loss. This is mainly attributable to: the negative impact on the profitability of the Group arising from diseconomies of scale as the group's consolidated revenue decreased by 17% from HKD 544.8 million in the first five months of 2016 to HKD 450.1 million in the first five months of 2017; additional costs and expenses incurred in the first five months of 2017 as the group completed its factory relocation project during 2016 with new buildings being constructed on its factory sites in Pingdi Town of Shenzhen City, Heyuan City and Zhongshan City, which resulted in higher depreciation charges on the buildings and leasehold improvement; and the continuous increase in other operating costs in Mainland China in the first five months of 2017 as compared with the corresponding period in 2016.