Leadway Technology Investment Group Limited provided group earnings guidance for the year ended 31 December 2022. The Group expected to record a small amount of net profit, as compared to the net loss of HKD 21.3 million for the year ended 31 December 2021. The Board considers that such turnaround from net loss to net profit position is mainly attributable to the following factors: depreciation and amortisation decreased to HKD 9.2 million (2021: HKD 18.5 million) due to the fact that there are less depreciable property, plant and equipment and intangible assets during the year; there is net exchange gain during the year of HKD 4.2 million (2021: net exchange loss of HKD 1.5 million).

This is due to the depreciation of Renminbi against Hong Kong dollar during the year resulting in a decrease of Renminbi denominated payable balances, whereas appreciation of Renminbi against Hong Kong dollar was noted in 2021; capitalisation of staff salaries as development costs increased to HKD 6.4 million (2021: HKD 0.5 million) as new products are in more advanced development stage so more staff salaries are capitalised during the year; impairment loss on intangible assets of HKD 2.5 million was made in 2021, whereas no such impairment loss is identified during the year; and there is an increase in government subsidies income of HKD 1.2 million mainly due to the granting of 2022 Employment Support Scheme subsidy by the Hong Kong government under the anti-epidemic fund during the year, while no such subsidy was granted in 2021.