The board of directors of Yangtzekiang Garment Limited informed the shareholders of the Company and potential investors that, the Group is expected to record a loss for the year ended 31 March 2023 in the range of between HKD 20 million and HKD 30 million as compared to a profit after taxation of HKD 30 million for the year ended 31 March 2022. The Board is of the view that the expected loss was mainly attributable to the recognition of the share of losses of joint ventures in Wuxi which was resulted from the weakening market demands caused by Russia-Ukraine conflict, US and EU sanctions; unfavourable price movements in cotton and yarn and increase in manufacturing costs and impairment of inventories. Such share of losses of joint ventures has no effect on the Group's cash flow.

Notwithstanding the above, the expected loss was mitigated by the disposal of a loss-making factory and the decrease in selling and administrative expenses.