Michong Metaverse (China) Holdings Group Limited provided earnings guidance for the six months ended 31 December 2023. For the six months ended 31 December 2023 and the information currently available to the Board, the Group expects to record a net loss of approximately HKD 11,019,000 for the six months ended 31 December 2023 as compared to the net profit of approximately HKD 17,397,000 for the six months ended 31 December 2022. A decrease in the revenue from approximately HKD 66,551,000 for the six months ended 31 December 2022 to approximately HKD 50,674,000 for the six months ended 31 December 2023. The decrease was mainly due to aggregate effect of (1) the suspension of paying membership scheme in the electronic commerce ("E-Commerce") business, which the subscription fee dropped to nil for the six months ended 31 December 2023 (Six months ended 31 December 2022: approximately HKD 31,677,000); (2) exploration of advertising income in the E-Commerce business, which contributed revenue of approximately HKD 8,091,000 for the six months ended 31 December 2023 (Six months ended 31 December 2022: Nil); and (3) introduction of new business, online game Internet Protocol (IP) authorisation management services during the six months ended 31 December 2023, which contributed revenue of approximately HKD 6,215,000 to the Group; A decrease in gross profit margin from approximately 58.0% for the six months ended 31 December 2022 to approximately 28.7% for the six months ended 31 December 2023; An increase in selling expenses increased from approximately HKD 2,828,000 for the six months ended 31 December 2022 to approximately HKD 5,209,000 for the six months ended 31
December 2023 mainly due to the increase in staff costs for the sales team in the PRC to approximately HKD 4,445,000 for the six months ended 31 December 2023 (Six months ended 31 December 2022: approximately HKD 1,168,000) in line with the increase in average headcount of salesperson and selling activities in the PRC; and Share of results of associates amounted to losses of approximately HKD 1,751,000 (Six months ended 31 December 2022: Nil).