The board of directors of HKBN Ltd. hereby informed the shareholders of the Company and potential investors that based on the unaudited information currently available to the management, the Group expects to record a consolidated net loss of approximately HKD 1,300 million for the year ended 31 August 2023, as compared to the profit of HKD 553 million for the year ended 31 August 2022. The net loss is primarily caused by (i) the increase in finance cost by approximately HKD 500 million, mainly due to the rise in HIBOR as approximately half the bank borrowings of the Group bear floating interest at HIBOR plus a margin, and (ii) the recognition of impairment losses on goodwill of approximately HKD 1,200 million. Part of the impact of the increase in finance cost was already reflected in the results of the Company for the six months ended 28 February 2023.

The Group wishes to point out that the aforesaid impairment losses on goodwill will not have any effect on the cash flow of its business, and also have no impact on the business in future years.