China Environmental Technology Holdings Limited (China Environmental Technology) announced that the Hong Kong Court of Appeal has dismissed, by consent, the Notice of Appeal relating to its US$7.00 million 8% convertible bonds issued in 2018. The company and bond subscriber Sure Fast are now negotiating a settlement agreement.

The judgment handed down in April 2026 confirmed the Subscription Agreement, the Convertible Bonds and related documents as valid and enforceable, limiting Sure Fast’s current rights to bond redemption and accrued interest because the conversion period has expired.

Key restatement impacts on the company’s 2025 consolidated financial statements are as follows:

1. Balance-sheet adjustments • As at 1 January 2025, trade and other payables increase by HK$64.25 million, lifting total net liabilities to HK$637.20 million. • As at 31 December 2025, trade and other payables rise a further HK$70.24 million, taking total net liabilities to HK$703.88 million.

2. Profit-and-loss impact for FY 2025 • Finance costs rise by HK$7.43 million due to 10% default interest on overdue redemption and coupon payments. • Net loss attributable to shareholders expands from HK$52.40 million to HK$59.83 million.

Underlying adjustments recognise: • Redemption amount of HK$61.15 million (112% of principal). • Bond interest of HK$13.13 million accrued to maturity. • Default interest of HK$27.59 million (at 10% p.a.). • Derecognition of RMB35.37 million (HK$39.05 million at 31 December 2025) previously booked as a liability to a designated payer, now treated as intra-group.

The auditor has provisionally agreed to the restatements, which remain subject to final audit. Shareholders and potential investors are advised to exercise caution when dealing in the company’s shares.