China Dili Group provided preliminary unaudited consolidated group earnings guidance for the six months ended June 30, 2022. For the period, the group expects to record a loss attributable to equity shareholders of the Company of approximately RMB 1,190 million as compared to the profit attributable to equity shareholders of the Company of approximately RMB 159 million for the corresponding period in 2021. The expected turnaround of the Group's results is primarily attributable to (i) the recognition of impairment loss on property and equipment of approximately RMB 941 million; (ii) the net valuation losses on investment properties of approximately RMB 548 million as compared to that of RMB 38 million for the corresponding period in 2021; and (iii) the decrease in revenue from commission and lease income by approximately RMB 110 million as compared to that of the corresponding period in 2021, which arose as a result of the resurgence of coronavirus pandemic that led to the implementation of stricter pandemic control and lockdown measures in various major cities of the People's Republic of China (the PRC) in the first six months of 2022, disruptions to the supply chain and business activities of many PRC enterprises including the Group and its business partners, impact on operations and transaction volume of the agriculture wholesale markets, subsidies to traders and commission and lease income concessions.

The said impairment loss on property and equipment and net valuation losses on investment properties referred to in (i) and (ii) above resulted from among others, the concessions and subsidy payout to traders in affected agriculture wholesale market(s) whose operations have been disrupted during the first six months of 2022. In addition, a reversal of deferred tax of approximately RMB 363 million is expected to arise from (i) and (ii) above.