Zhewen Pictures has replied to the Shanghai Stock Exchange's regulatory inquiry letter regarding its 2025 annual report, disclosing that the gross margin of its film and television business has fallen to -102.79%, with asset impairment risks remaining persistently high. The company achieved operating revenue of 3.23 billion yuan in 2025, up 6.22% year-on-year, and net profit attributable to shareholders of 133 million yuan, up 10.46% year-on-year. However, revenue from the film and television business was only 4.6654 million yuan, accounting for 0.14% of total revenue, with gross margins over the past three years at -24.69%, -49.56%, and -102.79% respectively. As of the end of 2025, the balance of inventory impairment provisions reached 771 million yuan, of which provisions for film and television inventory amounted to 114 million yuan, a sharp year-on-year increase of 136.25%. The main project, 'One Step to Heaven', had a book balance of 310 million yuan with cumulative impairments of 291 million yuan, while 'The Golden Talisman' had a book balance of 175 million yuan with cumulative impairments of 146 million yuan. Provisions for bad debts on accounts receivable stood at 324 million yuan, with the 294 million yuan of individually assessed receivables provided for at a rate of 100%, involving multiple film and television companies that have been deregistered or lost contact. The textile business achieved operating revenue of 3.17 billion yuan, accounting for 99.82% of total revenue, but net profit attributable to shareholders in the first quarter of 2026 fell sharply by 54.34% year-on-year, squeezed by both rising raw material prices and exchange rate fluctuations.
Zhewen Pictures Group Co LtdFilm and TV business gross margin plunged to -102.79%, with high asset impairment risks and increased provisions.