Readboy Education Holding Company Limited provided consolidated earnings guidance for the six months ended 30 June 2023. For the period, the company expects loss attributable to the owners of the Company ranging from approximately RMB 35.0 million to RMB 40.0 million for the six months ended 30 June 2023 as compared to an unaudited consolidated loss attributable to the owners of the Company of approximately RMB 42.3 million for the corresponding period in 2022. Such expected loss is primarily attributable to: decrease in sales of personal student tablets and wearable products during the six months ended 30 June 2023.

The primary reasons for the decrease in sales are: 1) product sales were negatively impacted to a certain extent as the domestic economy was affected by the international environment; 2) enterprises from other sectors entering the educational electronics industry have amplified the competitive pressure; and 3) the pandemic has led some consumers to adopt a more cautious attitude towards consumer spending, resulting in product sales less favorable than expected. Such decrease in sales was partially offset by the increase in gross profit margin which was primarily due to higher pricing on new products and an increased share of sales on proprietary platform. As a result, gross profit decreased from approximately MYR 66.5 million for the six months ended 30 June 2022 to approximately RMB 48.6 million for the six months ended 30 June 2023; change in value of investments in the financial assets that disclosed in the Company's 2022 annual report during the reporting period, resulting in approximately RMB 20.2 million loss recognised from changes in fair value of financial assets at fair value through profit or loss for the six months ended 30 June 2023; and incurrence of research and development expenses amounting to approximately RMB 25.5 million for the six months ended 30 June 2023 as compared to RMB 16.2 million for the corresponding period in 2022.

The main reason for the rise in research and development expenses is the Group's increased investment in digital resource content and new product development.