The board of directors of D&G Technology Holding Company Limited announced that, based on the information currently available to the Board and a preliminary assessment by the Board with reference to the unaudited management accounts of the Group for the year ended 31 December 2022, it is expected that the Group will record a net loss attributable to the owners of the Company of between approximately RMB 39 million and RMB 44 million for the Year, as compared with a net profit attributable to the owners of the Company of approximately RMB 11 million for the year ended 31 December 2021. Such expected net loss was mainly attributable to the decrease in revenue and gross profit, the increase in provision for impairment loss on trade receivables and the increase in the marketing expenses. Due to the ongoing outbreak of the Coronavirus Disease 2019 and the corresponding control measures in China, such measures not only affected the Group's business activities and deliveries during the Year but also caused the postponement and delay of some of its customers' projects which led to an increase in the recoverability risks of the trade receivables of the Group.

During the Year, the Company has launched marketing activities in promoting its newly rolled out modular models to the market, which resulted in an increase in marketing expenses.