United Asia Group (00458) and Authentic Brands Group prematurely terminated the franchise agreement for Reebok brand products in China

Zhitong Finance App News, United Asia Group (00458) issued an announcement regarding the Group's strategic review of its franchise brand portfolio and business goals, including a review of Reebok's franchise arrangements in mainland China, Hong Kong, Macau and Taiwan (collectively, the “region”). In response to the Group's adjustments to its business strategy and better allocation of resources to support the Group's long-term growth, on December 25, 2025, the Group and Authentic Brands Group (acting through its subsidiary, RILUK IPCO Limited, the franchise grantor of the Reebok brand) agreed to prematurely terminate the Group's franchise agreement to distribute Reebok brand products in the region, with effect from December 31, 2025 (end date). Due to this early termination, the Group expects to obtain non-cash income of between HK$120 million and HK$130 million for the year ended 31 December 2025 due to the termination of the Reebok franchise and the associated franchise fees payable as confirmed in the Group's consolidated financial position statement. The franchise and related franchise fees payable were initially confirmed when the Reebok franchise agreement came into effect, that is, the present value of the minimum guaranteed franchise fee payable by the Group during the term of the Reebok franchise agreement. After the early termination of the Reebok franchise agreement, the Group is no longer required to pay a guaranteed minimum franchise fee.

Furthermore, despite the early termination of the Reebok franchise agreement, the Group will continue to operate the distribution business of its multi-brand products for other franchises and its own brands, further complementing its robust garment business.