Notice Regarding Revision of Full-Year Earnings Forecast and Expected Loss Recording

Details of Revised Earnings Forecast

GNI Group, Inc. has revised its consolidated earnings forecast for the fiscal year ending December 2025, lowering revenue from 28,733 million yen previously forecast to 26,841 million yen, a decrease of 6.6%. Operating income, income before tax, net income, and net income attributable to owners of parent are all expected to significantly decline, with net income forecasted at a loss of 5,937 million yen and net income attributable to owners of parent at a loss of 3,420 million yen. The main reasons for the revision are sales of new pharmaceutical product Etorel® falling short of initial budget, and exclusion of listing gain of 22,854 million yen due to the postponed NASDAQ IPO of core subsidiary Cullgen, together with recording a full-year operating loss forecast of 3,996 million yen.

Impairment Loss and Future Outlook

Following impairment tests by independent third parties, GNI Group expects to record a total impairment loss of 468 million yen on goodwill for Miclen Healthcare Co., intangible assets of Shanghai Genomics Technology, and fixed assets of Shanghai Leaf International Trade. Cullgen’s listing remains pending approval; listing gain will be recorded upon IPO completion, although initial stock price and foreign exchange movements could affect the amount. Sales of main product Icerui are progressing well, and both the pharmaceutical and medtech divisions are expected to achieve record-high revenue for the full year.