PuraPharm Corporation Limited provided unaudited consolidated earnings guidance for the six months ended June 30, 2022. For the period, the group expected to record a net loss of not more than HKD 42 million as compared to the consolidated net profit of approximately HKD 12.0 million recorded for the corresponding period ended June 30, 2021. Based on the information currently available, the Board believes that the expected net loss in 2022 Interim Period is mainly attributable to the slowdown of concentrated Chinese medicine granules business in China, as a result of the temporary shortage of the number of prescribed national standards and provincial standards for CCMG which has hindered the use of CCMG in prescriptions by hospitals and clinics, resulting in an impact on sales during the 2022 Interim Period; (2) the stocking up on CCMG products by some hospitals before the new policy was implemented in November 2021, which has reduced demand temporarily after the implementation of the new policy; and with the cost of CCMG produced under the prescribed national standards higher than before, the market still undergoing adjustment to adopt to the new higher pricing.

The net loss is also partly attributable to the one-off and non-cash impairment losses of the biological assets related to the Group's plantation segment because of a reduction in expected future output of raw Chinese herbs.