K & P International Holdings Limited provided unaudited consolidated earnings guidance for the year ended 31 December 2023. For the year, the company expects net loss attributable to owners of the Company of not more than HKD 27,000,000 for the year ended 31 December 2023, compared to an audited consolidated net loss attributable to owners of the Company of HKD 503,036 for the year ended 31 December 2022. The expected loss for the year ended 31 December 2023 was mainly attributable to the following: (i) a decrease in the Group's revenue of around 30% to 35% (as compared to the year ended 31 December 2022), due to (a) the uncertain economic outlook and the generally weak consumer sentiments in the European markets as a result of the ongoing war in Ukraine and the unfavourable inflationary environment, especially during the first half of the period,
which in turn led to a negative impact on the sale of finished products by the Group's customers to the consumers in those markets, and (b) the rise in interest rates in face of the high inflation rate in the European markets, which affected the Group's customers' desire to undertake new development projects initiatives, leading to fewer new revenue streams for the Group; and (ii) despite the decrease in revenue, the direct costs of sales (including factory overheads) were not proportionately reduced to the same extent. Accordingly, the Group recorded a decrease in gross profit of around 50% to 55% (as compared to the year ended 31 December 2022).