Core Viewpoint - ALCO HOLDINGS (00328.HK) announced a proposed capital reorganization involving share consolidation, capital reduction, and share split to improve its capital structure and address accumulated losses [1][2] Group 1: Share Consolidation - The company plans to consolidate every ten (10) existing shares with a par value of HKD 0.01 into one (1) share with a par value of HKD 0.10 [1] - Any fractional shares resulting from the consolidation will be cancelled [1] Group 2: Capital Reduction - The capital reduction will involve the cancellation of any fractional shares resulting from the consolidation and adjusting the total number of issued shares to the nearest whole number [2] - The par value of each issued consolidated share will be reduced from HKD 0.10 to HKD 0.01 [2] Group 3: Share Split - Following the capital reduction, each unissued consolidated share with a par value of HKD 0.10 will be split into ten (10) shares with a par value of HKD 0.01 [1] Group 4: Share Premium Reduction - The total amount in the share premium account will be reduced to zero, and the resulting amounts will be transferred to the company's paid surplus account to offset accumulated losses [2] Group 5: Rights Issue - After the capital reorganization, the company proposes a rights issue where each adjusted share will entitle the holder to four (4) new shares at a subscription price of HKD 3.24 per share [2] - The rights issue aims to raise up to approximately HKD 148.465 million before expenses through the issuance of up to 45,822,744 new shares [2]

[Performance Summary](index=1&type=section&id=Performance%20Summary) The company's continuing operations experienced a significant revenue decline from HKD 148 million to HKD 99 million for the year ended March 31, 2025, resulting in a loss of HKD 64 million attributable to owners of the Company, a reversal from the prior year's profit of HKD 6 million [Overall Performance](index=1&type=section&id=Overall%20Performance) The company's continuing operations experienced a significant revenue decline from HKD 148 million to HKD 99 million for the year ended March 31, 2025, resulting in a loss of HKD 64 million attributable to owners of the Company, a reversal from the prior year's profit of HKD 6 million FY2025 vs. FY2024 Performance Comparison | Metric | FY2025 | FY2024 | | :--- | :--- | :--- | | **Revenue from Continuing Operations** | 99 million HKD | 148 million HKD | | **(Loss)/Profit Attributable to Owners of the Company** | (64 million HKD) | 6 million HKD | [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) This section presents the Group's financial performance and position, highlighting a significant shift from profit to loss and a deteriorating balance sheet [Consolidated Statement of Profit or Loss](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) Revenue from continuing operations decreased 33.1% to HKD 99.31 million, leading to a HKD 64.27 million loss from continuing operations and a total annual loss attributable to owners of the Company, contrasting with a HKD 601 million profit last year primarily from discontinued operations Key Data from Consolidated Statement of Profit or Loss (Continuing Operations) | Item | FY2025 (thousand HKD) | FY2024 (thousand HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 99,313 | 148,422 | -33.1% | | Gross Profit | 5,121 | 8,864 | -42.2% | | Loss Before Income Tax | (64,270) | (3,070) | Loss Widened | | Loss from Continuing Operations for the Year | (64,270) | (3,070) | Loss Widened | (Loss)/Profit Attributable to Owners of the Company and (Loss)/Earnings Per Share | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | **Annual (Loss)/Profit Attributable to Owners of the Company (thousand HKD)** | (64,270) | 600,692 | | **Basic (Loss)/Earnings Per Share (HKD)** | (0.63) | 9.79 | | **Basic (Loss)/Earnings Per Share from Continuing Operations (HKD)** | (0.63) | 0.10 | - The significant profit in FY2024 primarily stemmed from gains on discontinued operations, amounting to **HKD 595 million**, mainly from the deconsolidation of Aiko Electric Group[4](index=4&type=chunk)[6](index=6&type=chunk)[40](index=40&type=chunk) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=4&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The total loss for the year was HKD 64.27 million, but a positive currency translation impact of HKD 11.41 million reduced the total comprehensive expense to HKD 52.86 million, contrasting with HKD 583 million in total comprehensive income last year Total Comprehensive (Expense)/Income | Item | FY2025 (thousand HKD) | FY2024 (thousand HKD) | | :--- | :--- | :--- | | (Loss)/Profit for the Year | (64,270) | 591,772 | | Exchange Differences on Translation | 11,411 | (8,775) | | **Total Comprehensive (Expense)/Income for the Year** | **(52,859)** | **582,997** | [Consolidated Statement of Financial Position](index=5&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, the Group reported net current liabilities of HKD 143 million and a total deficit of HKD 64.69 million, reflecting a severe financial position and significant liquidity pressure Key Data from Consolidated Statement of Financial Position | Item | FY2025 (thousand HKD) | FY2024 (thousand HKD) | | :--- | :--- | :--- | | Total Assets (Non-current + Current) | 179,494 | 182,410 | | Total Liabilities (Current + Non-current) | 244,187 | 269,937 | | **Net Current Liabilities** | **(142,651)** | **(169,371)** | | **Total Deficit** | **(64,693)** | **(87,527)** | [Notes to the Financial Statements](index=7&type=section&id=Notes%20to%20the%20Financial%20Statements) This section provides detailed disclosures on the Group's financial position, including significant uncertainties regarding its going concern ability, segment information, and the impact of deconsolidated subsidiaries [1. General Information and Basis of Preparation](index=7&type=section&id=1.%20General%20Information%20and%20Basis%20of%20Preparation) The Group's going concern ability is highly uncertain due to a HKD 64.27 million loss, HKD 143 million net current liabilities, and HKD 47.53 million in overdue bank borrowings, making the success of management's debt restructuring and cash flow improvement plans critical for financial reporting - The company's ability to continue as a going concern faces significant uncertainty, primarily due to an annual loss of approximately **HKD 64.27 million**, net current liabilities of approximately **HKD 143 million**, and overdue bank borrowings of approximately **HKD 47.53 million**[17](index=17&type=chunk) - To address the liquidity crisis, management is implementing several measures, including: (i) negotiating debt restructuring with banks; (ii) discussing shareholder loan extensions with the estate administrator of the deceased former chairman; (iii) negotiating extended repayment terms with suppliers; and (iv) streamlining product portfolios and controlling costs to improve operating cash flow[18](index=18&type=chunk)[19](index=19&type=chunk)[20](index=20&type=chunk)[22](index=22&type=chunk) [3. Segment Information](index=9&type=section&id=3.%20Segment%20Information) The Group's continuing operations revenue of HKD 99.31 million was entirely from the Notebook Computer Products segment, with Asia as the sole revenue-contributing region, a change from last year which included European sales - The Group's continuing operations revenue is entirely dependent on the **Notebook Computer Products** segment, with the Audio-Visual Products segment generating no external sales revenue this year[28](index=28&type=chunk)[29](index=29&type=chunk) Revenue by Geographical Region (thousand HKD) | Region | FY2025 | FY2024 | | :--- | :--- | :--- | | Asia | 99,313 | 105,435 | | Europe | – | 37,998 | | Others | – | 4,989 | | **Total** | **99,313** | **148,422** | - Customer concentration is high, with two major customers (Customer A and Customer B) collectively contributing **HKD 48.49 million** in revenue, accounting for **48.8%** of total turnover[32](index=32&type=chunk) [8. Discontinued Operations](index=12&type=section&id=8.%20Discontinued%20Operations) The Group ceased Dongguan production in 2022, and in FY2024, the court-ordered liquidation and deconsolidation of 'Aiko Electric' resulted in a HKD 596 million gain, significantly contributing to last year's substantial profit - The Group made a strategic decision in **August 2022** to cease operations of its Dongguan production line, reallocating resources to businesses with higher growth potential[37](index=37&type=chunk) - Due to the liquidation of subsidiary Aiko Electric Company Limited, the Group lost control and deconsolidated it on **June 28, 2023**, recognizing a gain of **HKD 596 million** from discontinued operations in FY2024[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk) [10. Deconsolidation of Subsidiaries](index=16&type=section&id=10.%20Deconsolidation%20of%20Subsidiaries) The Group deconsolidated AVITA TECH and Nexstgo this year due to court-ordered liquidations, recognizing gains of HKD 2.47 million and HKD 77.71 million respectively - Due to the court-ordered liquidation of subsidiary AVITA TECH, the Group lost control and deconsolidated it on **May 29, 2024**, recognizing a gain of **HKD 2.47 million**[47](index=47&type=chunk)[49](index=49&type=chunk) - Due to the court-ordered liquidation of subsidiary Nexstgo Company Limited, the Group lost control and deconsolidated it on **January 10, 2024**, recognizing a gain of **HKD 77.71 million**[50](index=50&type=chunk)[51](index=51&type=chunk) [11. Provision for Financial Guarantees](index=17&type=section&id=11.%20Provision%20for%20Financial%20Guarantees) The Group recognized a **HKD 108 million** provision for financial guarantees on former subsidiaries' loans as of March 31, 2025, significantly impacting current liabilities Provision for Financial Guarantees (thousand HKD) | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | Financial Guarantees Issued | 108,468 | 123,532 | [12. Earnings/(Loss) Per Share](index=17&type=section&id=12.%20Earnings%2F%28Loss%29%20Per%20Share) For the year ended March 31, 2025, the loss attributable to owners of the Company was HKD 64.27 million, resulting in a basic and diluted loss per share of HKD 0.63 based on 102 million weighted average ordinary shares Loss Per Share Calculation | Item | FY2025 | | :--- | :--- | | Loss Attributable to Owners of the Company (thousand HKD) | (64,270) | | Weighted Average Number of Ordinary Shares | 102,318,344 | | **Basic and Diluted Loss Per Share (HKD)** | **(0.63)** | [Management Discussion and Analysis](index=20&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's perspective on the Group's financial performance, business transformation, and liquidity challenges, outlining future strategies [Group Results and Dividends](index=20&type=section&id=Group%20Results%20and%20Dividends) Management attributes the 33% revenue decline and HKD 64 million loss to global economic recession, contrasting with last year's HKD 592 million profit from one-off deconsolidation gains, and the Board recommends no final dividend - Revenue decreased by **33%** from **HKD 148 million** to **HKD 99 million**[69](index=69&type=chunk) - The current year's loss of **HKD 64 million** is primarily due to reduced revenue from global economic recession, whereas last year's **HKD 592 million** profit mainly stemmed from one-off gains from deconsolidation of disposal groups and subsidiaries[69](index=69&type=chunk) - The Board does not recommend a final dividend for the year ended **March 31, 2025**[68](index=68&type=chunk)[69](index=69&type=chunk) [Business Review and Outlook](index=20&type=section&id=Business%20Review%20and%20Outlook) The Group's core business has transitioned to self-branded notebooks and tablets with outsourced production, yet its financial outlook remains challenging, necessitating continued reliance on capital market financing, operational efficiency improvements, and strategic partnerships - The core business involves developing and selling self-branded notebooks and tablets, with production transitioning from in-house manufacturing to outsourced ODM/OEM[70](index=70&type=chunk) - The financial position remains challenging, as the company would still face a net loss without one-off gains from subsidiary disposals, necessitating continued reliance on capital market fundraising in the future[70](index=70&type=chunk)[71](index=71&type=chunk) - Future strategic priorities include: optimizing operations (e.g., headcount reduction, cost control), seeking business collaborations (strategic partners, technological innovation), and exploring capital market financing (e.g., rights issues)[77](index=77&type=chunk) [Liquidity and Financial Resources](index=21&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's financial position is very tight, with a **HKD 65 million** total deficit, **HKD 10 million** in cash, and **HKD 184 million** in net borrowings at fiscal year-end, necessitating active management of inventory and receivables Liquidity and Debt Position (thousand HKD) | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | Bank Balances and Cash | 10,000 | 24,000 | | Net Borrowings | 184,000 | 186,000 | | Total Deficit | 65,000 | 88,000 | - The majority of the Group's sales, purchases, and borrowings are settled in **USD** and **HKD**, resulting in limited foreign exchange risk[75](index=75&type=chunk) [Independent Auditor's Report](index=23&type=section&id=Independent%20Auditor%27s%20Report) This section details the auditor's "Disclaimer of Opinion" on the Group's financial statements, citing significant uncertainties related to going concern and audit scope limitations [Disclaimer of Opinion](index=23&type=section&id=Disclaimer%20of%20Opinion) The auditor issued a 'Disclaimer of Opinion' on the Group's consolidated financial statements for the year ended March 31, 2025, due to severe audit scope limitations and significant uncertainties, preventing an opinion on their truth and fairness - The auditor explicitly stated that they 'will not express an opinion on the Group's consolidated financial statements'[85](index=85&type=chunk) - The primary reason for the disclaimer of opinion is the significance of 'multiple uncertainties related to going concern,' which prevented the auditor from obtaining sufficient and appropriate audit evidence[85](index=85&type=chunk)[86](index=86&type=chunk) [Basis for Disclaimer of Opinion](index=23&type=section&id=Basis%20for%20Disclaimer%20of%20Opinion) The auditor's disclaimer is based on significant going concern uncertainties, including substantial losses and loan defaults, and audit scope limitations on FY2024 discontinued operations gains due to unavailable records held by the liquidator - **Material Uncertainty Related to Going Concern**: The Group faces severe financial distress, including losses, net current liabilities, bank loan defaults, and substantial financial guarantees; the auditor could not obtain sufficient evidence regarding the effectiveness of management's plans (e.g., debt restructuring, future cash flow improvement) to alleviate liquidity pressure[86](index=86&type=chunk)[89](index=89&type=chunk) - **Audit Scope Limitation on Comparative Figures**: The auditor could not verify the **HKD 595 million** gain from 'deconsolidation of disposal group' within discontinued operations in FY2024, as relevant books and records were held by the liquidator and unavailable for audit[94](index=94&type=chunk)[95](index=95&type=chunk) - Due to the aforementioned reasons, the auditor could not determine the appropriateness of preparing financial statements on a going concern basis, nor whether significant adjustments to the statement of financial position were necessary[89](index=89&type=chunk)[90](index=90&type=chunk) [Other Information](index=22&type=section&id=Other%20Information) This section includes details on the company's corporate governance practices and a list of its directors [Corporate Governance](index=22&type=section&id=Corporate%20Governance) The company declares compliance with all applicable code provisions of the Corporate Governance Code as per Appendix C1 to the Listing Rules for the year ended March 31, 2025 - The company has complied with all applicable provisions of the **Corporate Governance Code**[79](index=79&type=chunk) - The Audit Committee comprises five independent non-executive directors and has reviewed the financial statements for the current year[81](index=81&type=chunk) [List of Directors](index=27&type=section&id=List%20of%20Directors) The announcement provides a list of executive, non-executive, and independent non-executive directors in office as of the announcement date - As of the announcement date, the executive directors are Ms. Liao Liping (Co-Chairman) and Mr. He Zeyu; non-executive directors are Mr. Tian Yi (Co-Chairman) and Mr. Bian Wenbin; independent non-executive directors are Mr. Zhu Kaiqin, Mr. Lin Zhiying, Mr. Deng Shejian, and Mr. Deng Chaowen[104](index=104&type=chunk)

Financial Performance - For the six months ended September 30, 2024, Alco Holdings Limited reported a revenue of HKD 49,690 thousand, compared to HKD 85,686 thousand in the same period of 2023, representing a decrease of approximately 42%[1] - The gross profit for the period was HKD 4,612 thousand, slightly up from HKD 4,526 thousand year-over-year, indicating a marginal increase of about 1.9%[1] - The operating loss for the period was HKD 22,172 thousand, a significant decline from an operating profit of HKD 572,401 thousand in the previous year[1] - The net loss attributable to the company's ongoing operations was HKD 24,309 thousand, compared to a profit of HKD 572,354 thousand in the same period last year[1] - The company reported a total comprehensive loss of HKD 23,795 thousand for the period, compared to a comprehensive income of HKD 557,985 thousand in the previous year[18] - The company reported a loss attributable to owners of the company of HKD (24,309) thousand for the six months ended September 30, 2024, compared to a profit of HKD 572,354 thousand in the same period last year[33] - Basic and diluted loss per share from continuing and discontinued operations was HKD (0.25) for the current period, while it was HKD 14.26 for the same period last year[33] - The company recognized other income of HKD 2,477 thousand for the six months ended September 30, 2024, compared to HKD 613,382 thousand in the previous year, reflecting a substantial decrease[58] - The total loss for the group as of September 30, 2024, was HKD 79 million, with a loss per share of HKD 0.83[137] Cash Flow and Liquidity - Cash used in operating activities was HKD 16,789 thousand, an improvement from HKD 18,498 thousand in the previous year[26] - The cash and cash equivalents at the end of the period decreased to HKD 9,083 thousand from HKD 33,290 thousand at the end of the previous year, reflecting a decline of approximately 72.7%[26] - The company aims to reduce fixed operating costs across all functions and generate positive cash flow through the sale of investment properties and equipment[124] - As of September 30, 2024, the group had cash and deposits of HKD 9 million, with net borrowings amounting to HKD 1.919 billion[124] Assets and Liabilities - The total assets less current liabilities stood at HKD (70,820) thousand, slightly improved from HKD (74,034) thousand in the previous year[20] - The company’s total liabilities amounted to HKD 249,200 thousand, a decrease from HKD 256,444 thousand at the end of the previous reporting period[20] - The company’s equity attributable to owners was reported at HKD (78,782) thousand, compared to HKD (72,585) thousand in the previous year, indicating a worsening of equity position[21] - The total liabilities of the company as of September 30, 2024, amounted to approximately HKD 258 million, with net debt of about HKD 79 million[53] Operational Changes and Strategies - The company has implemented several cost-cutting measures, resulting in a significant reduction in operating costs, with employee benefits expenses decreasing from HKD 11,269 thousand to HKD 8,578 thousand year-on-year[51] - The management has reassessed the business coverage and plans to focus on overseas strategic markets while closing operations in unprofitable regions[42] - The company is considering further asset sales to reduce bank borrowings, with approximately HKD 48 million of bank loans secured by pledged properties[53] - The company has adopted an OEM/ODM production model, which is expected to positively impact daily maintenance costs significantly[42] - The company continues to face a challenging business environment, with a net loss expected if one-time gains from subsidiary divestitures are excluded[122] Sales and Revenue - The company reported external sales of HKD 49,690 thousand for the six months ended September 30, 2024, a decrease from HKD 85,686 thousand in the same period of 2023, representing a decline of approximately 42%[56] - The revenue from the company's own brand laptops decreased by 42% to HKD 50 million due to domestic economic slowdown and intense competition in the electronics market[119] Research and Development - Research and development expenses for the current period amounted to HKD (22,172) thousand, compared to HKD 572,441 thousand in the previous year, indicating a significant reduction in R&D spending[56] Corporate Governance - The executive directors include Ms. Liao Liping (Co-Chairman) and Mr. He Zeyu, while the non-executive directors include Mr. Tian Yi (Co-Chairman) and Mr. Yang Min[151] - The independent non-executive directors consist of Mr. Zhu Kaiqin, Mr. Lin Zhiwei, Mr. Deng Shejian, and Mr. Deng Chaowen[151] Miscellaneous - The company has not declared any dividends for the current period, consistent with the previous year[33] - The board does not recommend the payment of an interim dividend for the six months ending September 30, 2024 (2023: none)[120] - The company has canceled the consolidation of AVITA TECH due to the loss of control as of May 29, 2024[63][64] - The report is available for viewing on the Hong Kong Stock Exchange and the company's website[150] - The report date is November 29, 2024[152]

Financial Performance - Revenue for the six months ended September 30, 2024, was HKD 49.69 million, a decrease of 42.7% compared to HKD 85.69 million in the same period of 2023[4] - The loss from continuing operations for the same period was HKD (24.31) million, compared to a profit of HKD 572.35 million in 2023[4] - The group recorded external sales of HKD 49,690,000 for the six months ended September 30, 2024, a decrease of 42% compared to HKD 85,686,000 for the same period in 2023[50] - The group reported a loss before tax of HKD 24,309,000 for the six months ended September 30, 2024, compared to a profit of HKD 572,354,000 in the same period of 2023[50] - The net loss attributable to the company for the six months ended September 30, 2024, was HKD 24,309 thousand, a significant decline from a profit of HKD 575,354 thousand in 2023[59] - The company experienced a net loss of HKD 24 million, a significant decline from a profit of HKD 575 million in the previous year, primarily due to the absence of one-time gains from the disposal of subsidiaries[91] Operating Expenses and Cost Management - Total operating expenses decreased to HKD 78.31 million from HKD 85.46 million year-on-year, reflecting a reduction in administrative and sales expenses[4] - The company is focusing on cost reduction strategies to improve financial performance in the upcoming quarters[4] - The group has implemented cost-cutting measures, significantly reducing operational redundancies and focusing on overseas strategic markets[45] - The company aims to reduce fixed operating costs across all functions and seek collaboration opportunities with business partners to share financial burdens[95] Assets and Liabilities - Cash and cash equivalents decreased to HKD 9.08 million from HKD 23.86 million as of March 31, 2024[32] - Total liabilities as of September 30, 2024, amounted to approximately HKD 258,000,000, with net debt of about HKD 79,000,000[46] - The total assets less current liabilities stood at HKD (70.82) million, slightly improved from HKD (74.03) million as of March 31, 2024[32] - The company’s bank borrowings remained stable at HKD 47,528 thousand as of September 30, 2024, consistent with the previous reporting period[74] Inventory and Receivables - Inventory increased to HKD 7.15 million from HKD 3.34 million, indicating a potential buildup of stock[32] - As of September 30, 2024, trade receivables net amount was HKD 35,917 thousand, down from HKD 38,379 thousand as of March 31, 2024[68] - Trade receivables were HKD 36 million as of September 30, 2024, slightly down from HKD 38 million as of March 31, 2024, reflecting a prudent credit policy[97] - Trade payables decreased to HKD 21 million as of September 30, 2024, from HKD 29 million as of March 31, 2024, indicating improved cash flow management[97] Dividends and Share Capital - The company has not declared any dividends for the period[20] - The company did not recommend the payment of an interim dividend for the six months ended September 30, 2024, compared to no dividend in 2023[63] - The company’s authorized share capital remains at HKD 300,000,000 with 30 billion shares as of September 30, 2024[80] Strategic Initiatives - The group is in the process of closing operations in unprofitable overseas regions as part of its restructuring efforts[45] - The group plans to continue discussions with banks and financial institutions to manage bank borrowings, having repaid approximately HKD 10,000,000 during the period[41] - The company plans to sell investment properties, production equipment, land, and offices to generate positive cash flow and reduce the debt-to-asset ratio[95] - The company will continue to rely on capital markets for fundraising to address financial challenges, despite slight improvements in current operations[93] Employee and Operational Metrics - The group employed approximately 46 employees across Hong Kong, China, and Taiwan as of September 30, 2024, with compensation packages aligned with market conditions[100] - Employee benefit expenses decreased to HKD 8,578 thousand in 2024 from HKD 11,269 thousand in 2023, indicating a reduction in workforce costs[54] Audit and Reporting - The audit committee has reviewed the accounting principles and practices adopted by the group and discussed internal controls and financial reporting matters for the six months ended September 30, 2024[104] - The mid-term report is available for viewing on the Hong Kong Stock Exchange and the company's website[106]

[Company Information](index=2&type=section&id=Company%20Information) This section provides core company details including registration information, principal place of business, stock code, legal advisors, auditors, and share registrars [Company Basic Information](index=2&type=section&id=Company%20Basic%20Information) This section provides core company details including registration information, principal place of business, stock code, legal advisors, auditors, and share registrars - The company's stock code is **328**, listed on the Hong Kong Stock Exchange[9](index=9&type=chunk) - The company's auditor is **Kao Lee & Co. CPA Limited**[6](index=6&type=chunk) - The company's registered office is in Bermuda, with its principal place of business in Shatin, Hong Kong[7](index=7&type=chunk)[170](index=170&type=chunk) [Chairman's Statement](index=3&type=section&id=Chairman%27s%20Statement) [Group Performance and Dividends](index=4&type=section&id=Group%20Performance%20and%20Dividends) This year, the Group's revenue significantly increased by **66%** and recorded a gross profit, with the annual profit primarily attributed to a one-off gain from deconsolidation of discontinued operations; excluding this gain, the company would still face a net loss, and the Board does not recommend a final dividend FY2024 Performance Overview (Continuing Operations) | Indicator | FY2024 (HKD) | FY2023 (HKD) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 148,000,000 | 89,000,000 | +66% | | Gross Profit/(Loss) | 9,000,000 | (11,000,000) | Turnaround to Profit | | Profit/(Loss) for the Year | 592,000,000 | (516,000,000) | Turnaround to Profit | - The annual profit primarily resulted from a **HKD 596 million** gain from the deconsolidation of discontinued operations[174](index=174&type=chunk) - The Board does not recommend a final dividend for the financial year ended March 31, 2024[175](index=175&type=chunk) [Business Review and Outlook](index=4&type=section&id=Business%20Review%20and%20Outlook) The Group's core business involves developing and selling own-brand notebook and tablet computers, transitioning from in-house manufacturing to outsourced ODM/OEM; despite slight operational improvements, the overall financial situation remains severe, necessitating continued reliance on capital market financing, enhanced operational efficiency, and exploration of business collaborations to address challenges and pursue growth - The core business involves the development and sales of **own-brand notebook and tablet computers**[19](index=19&type=chunk) - The company has transitioned from in-house manufacturing to outsourced ODM and OEM, achieving gross profit, but the business environment remains challenging, with new product and market development as a top priority[48](index=48&type=chunk) - Excluding the one-off gain from subsidiary divestment, the company would still face a net loss for the current year, advising caution in operations and cash flow management[139](index=139&type=chunk) - Future sustainability will rely on continued capital market fundraising, operational optimization, and business collaborations[178](index=178&type=chunk)[483](index=483&type=chunk)[498](index=498&type=chunk) [Biographical Details of Directors](index=5&type=section&id=Biographical%20Details%20of%20Directors) [Board of Directors Profile](index=5&type=section&id=Board%20of%20Directors%20Profile) This section details the personal biographies of executive, non-executive, and independent non-executive directors, including their age, education, professional experience, and positions held in other listed companies - Executive Director Ms. Liao Liping possesses over **twenty-seven years** of experience in banking, investment, and education sectors[486](index=486&type=chunk) - Executive Director Mr. He Zeyu has extensive experience in multinational business, particularly in overseas market development[501](index=501&type=chunk) - The independent non-executive director team possesses diverse professional backgrounds including accounting, corporate finance, information technology, engineering, and public administration[12](index=12&type=chunk)[533](index=533&type=chunk)[535](index=535&type=chunk)[16](index=16&type=chunk)[491](index=491&type=chunk) [Corporate Governance Report](index=8&type=section&id=Corporate%20Governance%20Report) [Corporate Governance Practices](index=9&type=section&id=Corporate%20Governance%20Practices) The company is committed to maintaining high corporate governance standards, having complied with all applicable code provisions in Appendix C1 of the Listing Rules; the Board is responsible for the Group's business and strategic decisions and has received annual independence confirmations from all independent non-executive directors - During the current year, the company has complied with all applicable code provisions of the Code[537](index=537&type=chunk) [Board of Directors](index=9&type=section&id=Board%20of%20Directors) The Board currently comprises two executive directors, one non-executive director, and five independent non-executive directors, holding **49** meetings during the reporting period with generally high attendance; the company has adopted a board diversity policy and clarified the division of responsibilities between the Board and senior management - The Board consists of **8** members, including **2** executive directors, **1** non-executive director, and **5** independent non-executive directors, meeting independence requirements[508](index=508&type=chunk)[538](index=538&type=chunk) Attendance at Board and General Meetings During the Year | Director Name | Position | Board Meeting Attendance | General Meeting Attendance | | :--- | :--- | :--- | :--- | | Mr. He Zeyu | Executive Director | 49/49 | 0/3 | | Mr. Yang Min | Non-Executive Director | 17/17 | Not Applicable | | Mr. Chu Hoi Kan | Independent Non-Executive Director | 49/49 | 2/3 | | Mr. Lam Chi Wing | Independent Non-Executive Director | 49/49 | 0/3 | | Mr. Tang She Kin | Independent Non-Executive Director | 49/49 | 2/3 | [Board Committees](index=12&type=section&id=Board%20Committees) The company has established Remuneration, Audit, and Nomination Committees, all composed of and chaired by independent non-executive directors; the report details each committee's responsibilities, composition, and annual meeting attendance, ensuring the independence and professionalism of the corporate governance structure - The Remuneration Committee comprises **five** independent non-executive directors, responsible for reviewing and recommending remuneration for directors and senior management[516](index=516&type=chunk)[52](index=52&type=chunk) - The Audit Committee consists of **five** independent non-executive directors, overseeing the financial reporting process, internal controls, and risk management[517](index=517&type=chunk)[53](index=53&type=chunk) - The Nomination Committee is composed of **five** independent non-executive directors, responsible for reviewing the Board structure, identifying, and nominating director candidates[55](index=55&type=chunk)[550](index=550&type=chunk) [Auditor's Opinion and Management's Response](index=15&type=section&id=Auditor%27s%20Opinion%20and%20Management%27s%20Response) The auditor issued a 'Disclaimer of Opinion' on this year's consolidated financial statements primarily due to significant uncertainties related to going concern and insufficient audit evidence for discontinued operations; management responded by outlining remedial measures, including debt restructuring, seeking shareholder loan extensions, and improving operating cash flow, asserting the company's ability to continue as a going concern, which the Audit Committee concurred with, requesting resolution of the issues - Auditor **Kao Lee & Co. CPA Limited** issued a 'Disclaimer of Opinion' on the Group's consolidated financial statements[60](index=60&type=chunk)[167](index=167&type=chunk) - The basis for the disclaimer includes significant uncertainties that may cast substantial doubt on the going concern ability, such as **net current liabilities of HKD 169 million** and overdue bank borrowings, along with insufficient evidence to support management's cash flow forecasts[555](index=555&type=chunk)[93](index=93&type=chunk)[526](index=526&type=chunk) - Another issue is the auditor's inability to verify the revenue, loss, and asset and liability amounts related to discontinued operations (disposal group) due to lack of access to their books and records[96](index=96&type=chunk)[69](index=69&type=chunk)[529](index=529&type=chunk) - Management is implementing multiple measures to address liquidity pressure, including bank loan restructuring, managing shareholder loans, negotiating extended repayment terms with suppliers, and striving to improve operating cash flow[43](index=43&type=chunk)[46](index=46&type=chunk)[98](index=98&type=chunk)[67](index=67&type=chunk)[99](index=99&type=chunk) [Risk Management and Internal Control](index=21&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board bears ultimate responsibility for the Group's risk management and internal control systems, aiming to manage rather than eliminate risks; the Audit Committee oversees these systems and has outsourced internal control review to a third-party consulting firm to ensure system effectiveness and adequacy - The Board holds ultimate responsibility for risk management and internal control systems, and is responsible for reviewing their effectiveness[104](index=104&type=chunk) - The company has outsourced its internal control review to a third-party consulting firm to assess system effectiveness[566](index=566&type=chunk) [Directors' Report](index=22&type=section&id=Directors%27%20Report) [Business and Financial Review](index=23&type=section&id=Business%20and%20Financial%20Review) This report reviews the Group's principal activities, performance, and financial position, focusing on consumer electronics products and environmental impact reduction; financially, it discloses the use of proceeds from placings and rights issues, detailing the Group's liquidity, inventory, trade receivables, and payables, noting a significant reduction in employee count by year-end - The Group's principal activity is investment holding, with subsidiaries engaged in the design, manufacture, and sale of **consumer electronic products**[600](index=600&type=chunk)[110](index=110&type=chunk) - The Board does not recommend a final dividend[79](index=79&type=chunk) Financial Position Summary as at March 31, 2024 | Indicator | Amount (HKD) | 2023 Corresponding Period (HKD) | | :--- | :--- | :--- | | Total Deficit | 88,000,000 | 795,000,000 | | Bank Balances and Cash | 24,000,000 | 2,000,000 | | Net Borrowings | 186,000,000 | 154,000,000 | | Inventories | 3,000,000 | 38,000,000 | | Trade Receivables | 38,000,000 | 8,000,000 | | Trade Payables | 29,000,000 | 49,000,000 | - As at March 31, 2024, the Group employed approximately **15** employees, a significant reduction from **59** last year[143](index=143&type=chunk) [Use of Proceeds](index=24&type=section&id=Use%20of%20Proceeds) The report details the use of proceeds from the 2022 placing, 2023 rights issue, and 2024 placing; most funds were used as planned for loan repayment, external debt settlement, and general working capital, with some remaining funds earmarked primarily for bank loan repayment Summary of Use of Proceeds | Event | Intended Use | Amount Used as at 31/3/2024 (Thousand HKD) | Unused Amount (Thousand HKD) | | :--- | :--- | :--- | :--- | | 2023 Rights Issue | Repayment of bank and other borrowings | 28,000 | 11,000 | | 2023 Rights Issue | Settlement of external debts | (37,080) | 0 | | 2024 Placing | Repayment of bank and other borrowings | 0 | 10,000 | | 2024 Placing | Settlement of external debts | 15,500 | 1,500 | [Directors and Shareholding Structure](index=28&type=section&id=Directors%20and%20Shareholding%20Structure) This section lists Board members and changes during the reporting period, outlining director re-election arrangements; it confirms no material conflicts of interest for directors in competing businesses and the company's purchase of directors' liability insurance, also disclosing major shareholders with over **5%** equity and confirming sufficient public float - Ms. Liao Liping, Mr. Yang Min, Mr. Tang Chaoman, and Ms. Mak Suet Man will retire and offer themselves for re-election at the upcoming Annual General Meeting[127](index=127&type=chunk) - No directors or chief executives held interests or short positions in the shares of the company or its associated corporations requiring disclosure under the Securities and Futures Ordinance[154](index=154&type=chunk)[132](index=132&type=chunk) Major Shareholders' Shareholding (Over 5% Holding) | Shareholder Name | Capacity | Number of Shares (Long Position) | Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Bong Ching Chung | Beneficial Owner | 6,400,000 | 6.70% | | Mr. Toh Cheng Hock Kenneth | Beneficial Owner | 5,500,000 | 5.76% | - The company maintained a sufficient public float, exceeding **25%** of its issued shares, throughout the reporting period and up to the report date[188](index=188&type=chunk) [Independent Auditor's Report](index=32&type=section&id=Independent%20Auditor%27s%20Report) [Disclaimer of Opinion](index=33&type=section&id=Disclaimer%20of%20Opinion) Auditor Kao Lee & Co. CPA Limited issued a 'Disclaimer of Opinion' on the Group's consolidated financial statements as of March 31, 2024, primarily due to insufficient audit evidence regarding the appropriateness of the going concern assumption and inability to verify financial data for discontinued operations; these significant uncertainties and audit scope limitations form the basis for the disclaimer - The auditor explicitly stated that due to the significance of matters described in the 'Basis for Disclaimer of Opinion' section, sufficient and appropriate audit evidence could not be obtained, thus no opinion is provided on the consolidated financial statements[167](index=167&type=chunk)[191](index=191&type=chunk) - Significant uncertainty exists regarding going concern: the Group recorded a net loss from continuing operations, with **net current liabilities of HKD 169 million**, approximately **HKD 47.53 million** in overdue bank borrowings, and cash and balances of only approximately **HKD 23.86 million**[192](index=192&type=chunk)[555](index=555&type=chunk) - Audit scope limitation: the auditor could not verify the annual loss, assets held for sale, and related liabilities of the discontinued Dongguan production line (disposal group) due to inability to obtain its books and records[95](index=95&type=chunk)[96](index=96&type=chunk)[221](index=221&type=chunk)[222](index=222&type=chunk) - The auditor could not be satisfied with the reasonableness of management's forecasts for debt restructuring, shareholder loan extensions, and future operational improvements, thus unable to determine the appropriateness of preparing financial statements on a going concern basis[196](index=196&type=chunk)[526](index=526&type=chunk) [Consolidated Financial Statements](index=36&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Profit or Loss](index=36&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) For the year ended March 31, 2024, the Group's continuing operations recorded a loss of approximately **HKD 3.07 million**, but achieved an overall profit of approximately **HKD 592 million** for the year, turning profitable, primarily due to a **HKD 595 million** profit from discontinued operations (mainly from deconsolidation gain); basic earnings per share were **HKD 9.79** Consolidated Statement of Profit or Loss Summary | Item | 2024 (Thousand HKD) | 2023 (Thousand HKD) | | :--- | :--- | :--- | | **Continuing Operations** | | | | Revenue | 148,422 | 89,321 | | Gross Profit/(Loss) | 8,864 | (10,952) | | Loss for the Year from Continuing Operations | (3,070) | (91,919) | | **Discontinued Operations** | | | | Profit/(Loss) for the Year from Discontinued Operations | 594,842 | (423,695) | | **Profit/(Loss) for the Year** | **591,772** | **(515,614)** | Earnings/(Loss) Per Share | Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Basic Earnings/(Loss) Per Share | 9.79 | (33.18) | | Diluted Earnings/(Loss) Per Share | 9.79 | (33.18) | [Consolidated Statement of Financial Position](index=39&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As at March 31, 2024, the Group's financial position remained severe; despite an increase in total assets, net current liabilities amounted to **HKD 169 million**, and total equity was a negative **HKD 87.53 million**, with major liabilities including bank borrowings, shareholder loans, and financial guarantees for former subsidiaries Consolidated Statement of Financial Position Summary | Item | March 31, 2024 (Thousand HKD) | March 31, 2023 (Thousand HKD) | | :--- | :--- | :--- | | **Total Assets** | **182,410** | **283,288** | | Non-current Assets | 95,337 | 146,449 | | Current Assets | 87,073 | 136,839 | | **Total Liabilities** | **(269,937)** | **(1,077,958)** | | Current Liabilities | 256,444 | 1,058,588 | | Non-current Liabilities | 13,493 | 19,370 | | **Net Current Liabilities** | **(169,371)** | **(921,749)** | | **Total Deficit (Total Equity)** | **(87,527)** | **(794,670)** | [Consolidated Statement of Cash Flows](index=42&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) This year, the Group's operating activities resulted in a net cash outflow of **HKD 69.47 million**, while financing activities generated a net cash inflow of **HKD 96.07 million**, primarily from share issuance proceeds; consequently, cash and cash equivalents increased from **HKD 2.39 million** at the beginning of the year to **HKD 23.86 million** at year-end Consolidated Statement of Cash Flows Summary | Item | 2024 (Thousand HKD) | 2023 (Thousand HKD) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (69,473) | (157) | | Net Cash Generated from Investing Activities | 3,645 | 8,316 | | Net Cash Generated From/(Used In) Financing Activities | 96,068 | (17,113) | | **Net Increase/(Decrease) in Cash and Cash Equivalents** | **30,240** | **(8,954)** | | Cash and Cash Equivalents at Beginning of Year | 2,392 | 10,202 | | **Cash and Cash Equivalents at End of Year** | **23,855** | **2,940** | [Notes to the Consolidated Financial Statements](index=44&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [Note 1: General Information and Basis of Preparation](index=45&type=section&id=Note%201%3A%20General%20Information%20and%20Basis%20of%20Preparation) This note explains the basis for preparing financial statements on a going concern basis, despite significant uncertainties including continuous losses, high net current liabilities, and bank loan defaults; the Board believes in going concern based on plans like debt restructuring, shareholder loan negotiations, cost control, and sales expansion, but acknowledges risks if these plans fail - The Board acknowledges significant challenges for the Group, including a loss from continuing operations of approximately **HKD 3.07 million** and net current liabilities of approximately **HKD 169 million**[265](index=265&type=chunk) - As at year-end, the Group had approximately **HKD 47.53 million** in bank borrowings that were not repaid on schedule and could be demanded for immediate repayment[242](index=242&type=chunk)[588](index=588&type=chunk) - Management is implementing multiple measures to maintain going concern, including debt restructuring with banks, negotiating shareholder loan extensions with the late former chairman's estate, discussing extended repayment terms with creditors, and improving operating cash flow through product portfolio simplification and enhanced cost control[267](index=267&type=chunk)[268](index=268&type=chunk)[248](index=248&type=chunk)[270](index=270&type=chunk) [Note 4: Financial Risk Management](index=67&type=section&id=Note%204%3A%20Financial%20Risk%20Management) The Group faces market risks (foreign exchange, interest rate), credit risk, and liquidity risk; foreign exchange risk primarily stems from GBP and CAD with limited impact, while interest rate risk arises from floating-rate borrowings; credit risk from bank deposits and trade receivables has led to expected credit loss provisions; the most severe is liquidity risk, with current liabilities significantly exceeding current assets, a negative asset-liability ratio, and reliance on external financing for operations - Liquidity risk is extremely high: the Group has net current liabilities of approximately **HKD 169 million**, and approximately **HKD 47.53 million** in bank borrowings are overdue and subject to immediate repayment demand[927](index=927&type=chunk)[618](index=618&type=chunk) - Capital structure deterioration: the Group is in a net deficit position, with an asset-liability ratio of **-211.66%**, indicating liabilities significantly exceed equity[701](index=701&type=chunk)[700](index=700&type=chunk) - Credit risk management: the Group applies a lifetime expected credit loss model to trade receivables and has made a loss allowance provision of approximately **HKD 6.47 million**[469](index=469&type=chunk)[482](index=482&type=chunk) [Note 6: Revenue and Segment Information](index=83&type=section&id=Note%206%3A%20Revenue%20and%20Segment%20Information) This year, all revenue from the Group's continuing operations, totaling **HKD 148 million**, came from the 'Notebook Computer Products' segment, representing a **66%** year-on-year increase; geographically, Asia was the primary market, contributing over **70%** of revenue, with high customer concentration as the top two clients accounted for over half of the total revenue Revenue by Business Segment (Continuing Operations) | Business Segment | 2024 (Thousand HKD) | 2023 (Thousand HKD) | | :--- | :--- | :--- | | Audio-Visual Products | – | – | | Notebook Computer Products | 148,422 | 89,321 | | **Total** | **148,422** | **89,321** | Revenue by Geographical Region (Continuing Operations) | Geographical Region | 2024 (Thousand HKD) | 2023 (Thousand HKD) | | :--- | :--- | :--- | | Asia | 105,435 | 60,479 | | Europe | 37,998 | 23,695 | | Others | 4,989 | 5,147 | | **Total** | **148,422** | **89,321** | - Customer concentration is high, with sales to Customer A and Customer B accounting for **29%** and **22%** of total revenue, respectively[971](index=971&type=chunk)[990](index=990&type=chunk) [Note 11: Discontinued Operations/Disposal Group Held for Sale](index=88&type=section&id=Note%2011%3A%20Discontinued%20Operations%2FDisposal%20Group%20Held%20for%20Sale) This note details the financial impact of the discontinued Dongguan production line business (disposal group); due to a court-ordered winding-up of subsidiary Akai Electric Company Limited, the Group lost control and deconsolidated it on June 28, 2023, resulting in a gain of approximately **HKD 596 million**, which was the primary reason for the Group's overall profit this year - Due to a creditor's application, the court ordered the winding-up of Akai Electric Company Limited, a direct wholly-owned subsidiary of the Group, on **June 28, 2023**, leading to the Group losing control and deconsolidating it[643](index=643&type=chunk)[977](index=977&type=chunk) Gain Calculation from Deconsolidation of Akai Electric Group | Item | Amount (Thousand HKD) | | :--- | :--- | | Net Liabilities Deconsolidated | 1,900,203 | | Amounts Due from Akai Electric Group | (1,180,785) | | Financial Guarantees Provided | (121,984) | | Foreign Exchange Reserve Released Upon Deconsolidation | (1,044) | | **Gain on Deconsolidation** | **596,390** | - Discontinued operations recorded a profit of **HKD 595 million** this year, compared to a loss of **HKD 424 million** in the same period last year[999](index=999&type=chunk) [Note 40: Events After Reporting Period](index=132&type=section&id=Note%2040%3A%20Events%20After%20Reporting%20Period) Subsequent to the reporting period, Shanghai Commercial Bank Limited filed a winding-up petition against the company in the Hong Kong High Court due to the company's failure to honor loan guarantees for former subsidiary Akai Electric, involving outstanding loan principal and interest, with a hearing scheduled for August 28, 2024 - On **June 21, 2024**, Shanghai Commercial Bank Limited filed a winding-up petition against the company with the court[1044](index=1044&type=chunk)[1051](index=1051&type=chunk) - The petition is based on the company's loan guarantee for former subsidiary Akai Electric, involving outstanding loan principal of **HKD 2.62 million** and **USD 2.52 million**, plus interest[1044](index=1044&type=chunk) [Five-Year Financial Summary](index=132&type=section&id=Five-Year%20Financial%20Summary) [Five-Year Performance and Financial Position](index=133&type=section&id=Five-Year%20Performance%20and%20Financial%20Position) This summary presents the Group's key performance and financial position over the past five fiscal years; data indicates revenue continuously declined after peaking in 2021, while profit/loss attributable to owners of the company fluctuated significantly, showing losses in the last three years, with a profit only in FY2024 due to a one-off gain; total assets consistently shrank, and total liabilities peaked in 2022 and 2023, leading to total equity turning negative (total deficit) since 2022 Five-Year Performance Summary (As at Year Ended March 31) | Item | 2024 (Thousand HKD) | 2023 (Thousand HKD) | 2022 (Thousand HKD) | 2021 (Thousand HKD) | 2020 (Thousand HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 148,422 | 89,321 | 542,408 | 1,278,686 | 961,246 | | Profit/(Loss) Attributable to Owners of the Company | 600,692 | (510,242) | (594,575) | (360,463) | (599,374) | Five-Year Assets and Liabilities Summary (As at March 31) | Item | 2024 (Thousand HKD) | 2023 (Thousand HKD) | 2022 (Thousand HKD) | 2021 (Thousand HKD) | 2020 (Thousand HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 182,410 | 283,288 | 833,777 | 1,363,113 | 1,216,024 | | Total Liabilities | (269,937) | (1,077,958) | (1,106,700) | (1,032,927) | (535,104) | | Total Deficit (Equity) | (87,527) | (794,670) | (272,923) | 330,186 | 680,920 |

Financial Performance - For the fiscal year ending March 31, 2024, the company reported revenue of HKD 148.422 million, a significant increase from HKD 89.321 million in the previous year, representing a growth of approximately 66%[4] - The gross profit for the year was HKD 8.864 million, compared to a gross loss of HKD 10.952 million in the previous year, indicating a turnaround in profitability[4] - The company recorded a profit attributable to owners of HKD 600.692 million, a substantial improvement from a loss of HKD 510.242 million in the prior year[6] - Basic earnings per share from continuing operations were HKD 0.10, recovering from a loss of HKD 5.63 in the previous year[6] - The total comprehensive income for the year was HKD 582.997 million, compared to a loss of HKD 528.727 million in the previous year, reflecting a positive shift in overall financial performance[8] - The company reported external sales of HKD 148,422,000 for the year 2024, a significant increase from HKD 89,321,000 in 2023, representing a growth of 66%[28] - The company's operating loss for the year 2024 was HKD 3,070,000, compared to a much larger loss of HKD 91,919,000 in 2023, indicating an improvement in financial performance[28] - Revenue from the Asia region reached HKD 105,435,000 in 2024, up from HKD 60,479,000 in 2023, marking a growth of 74%[29] - The total income from continuing operations for 2024 was HKD 65,007,000, a substantial increase from HKD 11,464,000 in 2023[31] Assets and Liabilities - The company’s non-current assets decreased to HKD 95.337 million from HKD 146.449 million year-over-year, primarily due to changes in property and equipment[10] - Current assets increased significantly to HKD 87.073 million from HKD 53.885 million, driven by a rise in trade receivables[10] - Current liabilities decreased slightly to HKD 256.444 million from HKD 252.216 million, indicating improved liquidity management[10] - The group has outstanding bank loans of approximately HKD 47,528,000 that were due as of March 31, 2024, which remain unpaid[16] - The group's office and investment properties are valued at approximately HKD 120,000,000, which may assist in negotiating loan repayment extensions with banks[17] - Trade payables as of March 31, 2024, are approximately HKD 29,207,000, with plans to negotiate extended repayment terms[20] - The total liabilities included shareholder loans amounting to 38,052,000 HKD in 2024, down from 85,553,000 HKD in 2023[56] - The net liabilities associated with the assets classified as held for sale amount to HKD 1,900,203, while the assets held for sale are valued at HKD 82,954[37] Strategic Direction - The company has terminated its manufacturing business as noted in the financial statements, which may impact future operational strategies[13] - The company plans to focus on the design, manufacturing, and sales of consumer electronic products, including audio products and laptops, as part of its strategic direction moving forward[13] - The group is implementing measures to simplify its product portfolio and production model to enhance cash flow and control costs[21] - The board anticipates an increase in sales volume for laptop products in the coming months compared to the same period last year[21] - The company plans to continue focusing on the design and sales of consumer electronics, including audio and video products, and laptops, as part of its ongoing business strategy[27] - The group aims to explore business collaboration opportunities, including strategic partnerships and product diversification, to enhance competitiveness[67] Financial Challenges - The group reported a loss of approximately HKD 3,070,000 for the year ended March 31, 2024, indicating ongoing financial challenges[76] - As of March 31, 2024, the group's current liabilities net amount was approximately HKD 169,371,000, raising concerns about liquidity[76] - The group failed to repay bank loans totaling approximately HKD 47,528,000 by the due date, which could trigger immediate repayment demands from banks[76] - Cash and bank balances as of March 31, 2024, were only about HKD 23,855,000, highlighting severe cash flow issues[76] - The independent auditor expressed a lack of sufficient appropriate audit evidence to support the group's ability to continue as a going concern[78] - The group is facing significant uncertainties that may impact its ability to continue operations, as highlighted in the auditor's report[76] Impairments and Losses - The company has recognized a loss of HKD 594,842 from discontinued operations for the year ended March 31, 2024[38] - The company reported a net loss from investment properties of HKD 6,887,000 in 2024, compared to a loss of HKD 2,631,000 in 2023[31] - The company has reported a significant impairment loss of HKD 271,588 related to inventory for the year ended March 31, 2023[38] - The company has recognized impairment losses of approximately 3,043,000 HKD for property, plant, and equipment as of March 31, 2023[51] Dividends and Shareholder Information - The company has not declared or proposed any dividends for the years ended March 31, 2024, and March 31, 2023[50] - The company does not recommend the payment of a final dividend for the year ended March 31, 2024, consistent with the previous year[59] Future Outlook - The group expects to have sufficient operating funds to meet its needs for the fiscal year ending March 31, 2025, provided it can execute its plans[21] - The board believes that with the planned measures, the company will have sufficient working capital to meet its needs until March 31, 2025[91] - The effectiveness of the financial statements prepared on a going concern basis depends on the success of the plans and measures outlined[77]

Financial Performance - Revenue for the six months ended September 30, 2023, was HKD 85,686,000, a significant increase of 64.8% compared to HKD 51,977,000 in the same period of 2022[2] - Gross profit for the same period was HKD 4,526,000, recovering from a loss of HKD 1,338,000 in 2022[2] - Operating profit surged to HKD 572,401,000, compared to an operating loss of HKD 44,192,000 in the previous year[2] - The net profit attributable to the owners of the company was HKD 575,354,000, a turnaround from a loss of HKD 48,571,000 in 2022[3] - Total comprehensive income for the period amounted to HKD 557,985,000, compared to a loss of HKD 473,540,000 in the same period last year[5] - The company reported a basic and diluted earnings per share of HKD 14.26, recovering from a loss of HKD 31.72 in the previous year[3] - The company achieved a profit before tax of HKD 572,354,000 for the six months ended September 30, 2023, compared to a loss of HKD 48,571,000 in the same period of 2022[22] - Basic earnings per share for the period were HKD 14.26, a recovery from a loss of HKD 31.72 per share in the previous year[32] - The company reported a significant increase in trade receivables aged 0-30 days, which rose to HKD 19,541,000 from HKD 5,056,000, marking an increase of 286%[45] Cash Flow and Liquidity - Cash and cash equivalents increased significantly to HKD 33,290,000 from HKD 2,392,000 as of March 31, 2023[7] - For the six months ended September 30, 2023, the company reported a net cash outflow from operating activities of HKD 18,498,000, compared to a cash inflow of HKD 18,180,000 in the same period last year[12] - The company generated a net cash inflow from financing activities of HKD 49,396,000, contrasting with a cash outflow of HKD 18,521,000 in the previous year[12] - The cash and cash equivalents increased to HKD 33,290,000 at the end of the period, up from HKD 2,392,000 at the beginning of the period[12] - Cash and deposits amounted to HKD 33 million, with net bank borrowings of HKD 124 million as of September 30, 2023[69] Assets and Liabilities - Current liabilities increased to HKD 387,157,000, compared to HKD 252,216,000 as of March 31, 2023[8] - As of September 30, 2023, the company's total liabilities amounted to approximately HKD 414,000,000, with net liabilities of about HKD 145,000,000, reflecting a significant reduction due to the cancellation of consolidated accounts for discontinued operations[19] - The total liabilities as of September 30, 2023, were HKD 1,794,403,000, with a net debt of HKD 1,794,403,000 after eliminating intercompany receivables[39] - The bank borrowings increased to HKD 157,328,000 as of September 30, 2023, compared to HKD 68,318,000 as of March 31, 2023, reflecting a growth of 130%[50] - The total accounts payable and other payables reached HKD 141,514,000 as of September 30, 2023, up from HKD 96,040,000 as of March 31, 2023, indicating a rise of 47%[47] Strategic Initiatives - The company has implemented various cost-cutting measures to streamline core business activities, which are expected to significantly reduce daily maintenance costs[17] - The company plans to focus on overseas strategic markets while closing operations in underperforming regions, with related applications currently in progress[17] - The company has engaged in discussions with shareholders regarding the extension of shareholder loans, which are crucial for ongoing operations[17] - The company has introduced an OEM/ODM production model, which has positively impacted operational efficiency[17] - The group plans to reduce fixed operating costs across all functions and seek partnerships to share financial burdens[70] - The company aims to explore various commercially viable and profitable opportunities based on past performance[70] Dividends and Shareholder Information - The company did not declare any dividends for the period[3] - The company did not recommend an interim dividend for the six months ended September 30, 2023, consistent with the previous year[34] - The company has a shareholder loan balance of HKD 85,553,000, which is expected to be repaid within one year[51] Compliance and Governance - The company has complied with all applicable code provisions in the Corporate Governance Code as of September 30, 2023[79] - All directors confirmed compliance with the standards of the Model Code for Securities Transactions by Directors as of September 30, 2023[80] - The Audit Committee has reviewed the accounting principles and practices adopted by the group for the six months ended September 30, 2023[81] - The interim report is available for viewing on the Hong Kong Stock Exchange and the company's website[82] - The board consists of two executive directors, one non-executive director, and five independent non-executive directors as of the report date[83] Other Income and Expenses - The company reported a total other income of HKD 613,382,000 for the six months ended September 30, 2023, compared to HKD 5,014,000 in the previous year, showing a substantial increase[24] - Research and development expenses amounted to HKD 12,345,000, reflecting the company's commitment to innovation despite previous losses[22] - Rental income from investment properties decreased to HKD 463,000 from HKD 2,128,000 year-on-year, indicating a decline of approximately 78.2%[24] - The company recorded a loss of HKD 465,691,000 during the period, contributing to a total comprehensive expense of HKD 473,540,000[10] - As of September 30, 2023, the group had total losses of HKD 145 million and a loss per share of HKD 1.82, down from HKD 795 million and HKD 52.22 respectively as of March 31, 2023[69]

Financial Performance - The group's revenue decreased by 84% from HKD 542 million in 2022 to HKD 89 million in 2023[7]. - The net loss attributable to shareholders significantly reduced by 72% from HKD 332 million in the previous year to HKD 92 million in the current year[7]. - The group reported a net loss of approximately HKD 91,919,000 for the year ended March 31, 2023, indicating significant financial challenges[57]. - The total loss for the group as of March 31, 2023, was HKD 795 million, compared to total equity of HKD 273 million in 2022[105]. - The total loss for the year was HKD 515,614,000, compared to HKD 594,594,000 in the previous year, indicating a reduction in overall losses[168]. - The company reported a total loss of HKD 515,614,000 for the year 2023, compared to a loss of HKD 594,594,000 in 2022, indicating a 13.2% improvement in overall loss[173]. - Loss from continuing operations was HKD 86,547,000 in 2023, significantly reduced from HKD 331,659,000 in 2022, reflecting a 73.9% decrease[171]. - Loss from discontinued operations increased to HKD 423,695,000 in 2023 from HKD 262,916,000 in 2022, representing a 60.9% increase[171]. Operational Changes - The group is transitioning from a self-operated contract manufacturing model to a more cost-effective OEM/ODM production model to adapt to changing market demands[9]. - Future strategies include operational optimization through ongoing layoffs, process improvements, and cost control measures[14]. - The group is implementing measures to streamline its product portfolio and enhance cost control to improve gross profit and operating cash flow[196]. - The group has faced significant operational challenges due to rising costs from the US-China trade war and the COVID-19 pandemic, leading to the termination of its production line in Dongguan[75]. Debt and Liquidity Management - The company is focused on debt reduction and has successfully negotiated with creditors to lower its debt burden, establishing a more sustainable capital structure[11]. - As of March 31, 2023, the group's net current liabilities amounted to approximately HKD 921,749,000, including overdue borrowings of about HKD 199,874,000[57]. - The group's cash and bank balances were only approximately HKD 2,940,000 as of March 31, 2023, raising concerns about liquidity[57]. - The group is actively seeking to restore its disrupted cash flow to fulfill all orders and improve sales and revenue[9]. - The group is in discussions with banks for debt restructuring, with total bank borrowings related to the financing agreement amounting to approximately HKD 133.068 million[192]. Corporate Governance - The board consists of two executive directors and three independent non-executive directors, ensuring a diverse governance structure[27]. - The company has adopted a board diversity policy, considering factors such as gender, age, cultural background, and professional experience to enhance board efficiency[30]. - The independent non-executive directors have confirmed their independence according to the listing rules, ensuring unbiased oversight[28]. - The company is committed to high standards of corporate governance to protect shareholder interests and enhance corporate value[25]. - The board is responsible for major business and strategic decisions, as well as monitoring the performance of senior management[31]. Financial Reporting and Compliance - The company has adopted new Hong Kong Financial Reporting Standards effective from April 1, 2022, which include several amendments that do not have a significant impact on financial performance or disclosures[200]. - The independent auditor issued a disclaimer of opinion regarding the financial statements due to uncertainties surrounding the company's ability to continue as a going concern[160]. - The company continues to ensure compliance with the latest accounting standards to maintain transparency and accuracy in financial reporting[200]. - The company has implemented various plans and measures to alleviate liquidity pressure and improve financial conditions[57]. Future Outlook - The company maintains a cautiously optimistic outlook for future growth and profitability opportunities[12]. - The group anticipates an increase in sales volume for laptop products in the coming months, based on existing sales orders as of June 2022[196]. - Capital market financing options, such as rights issues, are being considered to raise funds for strategic investments and future growth plans[14].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不發表任 何聲明，並明確表示，概不對因本公告全部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責 任。 （於百慕達註冊成立之有限公司） http://www.alco.com.hk 網址： 328 （股份代號： ） 截至二零二三年三月三十一日止年度 經審核全年業績公告 表現摘要 二零二三年 二零二二年 （經重列） 持續經營業務 89 542 —營業額（港元） 百萬 百萬 87 332 —擁有人應佔虧損（港元） 百萬 百萬 ...

Financial Performance - For the six months ended September 30, 2022, Alco Holdings Limited reported a revenue of HKD 51,977,000, a decrease of 85.3% compared to HKD 353,347,000 in the same period of 2021[2] - The cost of goods sold for the same period was HKD 53,315,000, resulting in a gross loss of HKD 1,338,000, compared to a gross profit of HKD 10,309,000 in 2021[2] - The operating loss for the period was HKD 44,192,000, significantly reduced from HKD 128,776,000 in the previous year[2] - The total comprehensive loss for the period was HKD 473,540,000, compared to HKD 175,912,000 in the same period last year, indicating a substantial increase in losses[6] - The loss attributable to equity holders of the company from continuing operations was HKD 48,571,000, down from HKD 132,827,000 in the previous year[3] - The company reported a loss per share of HKD 64.3 cents for the period, compared to HKD 23.7 cents in the previous year[3] - For the six months ended September 30, 2022, total revenue was HKD 51,977 thousand, a decrease from HKD 353,347 thousand for the same period in 2021[36] - Revenue from Asia for the same period was HKD 40,822 thousand, compared to HKD 244,893 thousand in 2021, indicating a significant decline[36] - The company reported a loss attributable to owners of the company of HKD 48,571 thousand for the six months ended September 30, 2022, compared to a loss of HKD 132,827 thousand in 2021[43] - Basic loss per share for the six months ended September 30, 2022, was HKD (6.7), compared to HKD (18.3) in 2021[43] - The net loss for the period was HKD 49 million, a reduction of approximately 63% compared to a loss of HKD 133 million in the previous year[78] Cash Flow and Assets - For the six months ended September 30, 2022, the net cash generated from operating activities was HKD 18,180,000, a significant improvement compared to a cash outflow of HKD 122,134,000 in the same period of 2021[13] - The net cash used in investing activities was HKD 3,000, compared to a cash outflow of HKD 19,263,000 in the previous year[14] - The net cash used in financing activities was HKD 18,521,000, a decrease from a cash inflow of HKD 75,096,000 in the prior year[15] - The total cash and cash equivalents decreased by HKD 338,000, compared to a decrease of HKD 66,301,000 in the same period last year[16] - As of September 30, 2022, total liabilities amounted to approximately HKD 1,040,000,000, with net liabilities of about HKD 739,000,000[31] - Non-current assets decreased to HKD 164,450,000 as of September 30, 2022, from HKD 264,545,000 as of March 31, 2022[8] - Current liabilities were reported at HKD 1,028,946,000, a decrease from HKD 1,093,552,000 at the end of the previous fiscal year[8] - The company's inventory decreased significantly to HKD 89,024,000 from HKD 353,939,000 in the previous year[8] - As of September 30, 2022, trade payables amounted to HKD 189,912,000, down from HKD 207,553,000 as of March 31, 2022[61] - The total liabilities as of September 30, 2022, were HKD 358,484,000, compared to HKD 348,869,000 as of March 31, 2022[61] - Shareholder loans totaled HKD 432,692,000 as of September 30, 2022, an increase from HKD 401,966,000 as of March 31, 2022[65] Strategic Initiatives - The company has implemented several cost-cutting measures, including the cessation of in-house processing operations and a shift to an OEM/ODM production model, which is expected to significantly reduce daily maintenance costs[28] - The company has established a strategic distribution partnership with Giken Sakata, which will utilize bank financing to open letters of credit and repay suppliers[30] - The company is in discussions with shareholders regarding the extension of shareholder loans, with a total of HKD 74,000,000 in further loans utilized to repay certain borrowings[26] - The company is focusing on overseas strategic markets while closing operations in underperforming regions, with related applications currently in progress[28] - The company ceased operations of its Dongguan production line on August 31, 2022, to reallocate resources to higher growth potential business segments[48] - The company decided to cease sales in the North American market as part of its cost-reduction measures[80] - Significant reductions in production, sales, marketing, administrative, and R&D costs were implemented, leading to a substantial decrease in operating costs compared to the previous year[80] - The group plans to reduce fixed operating costs across all departments to navigate the challenging business environment[84] - The group aims to explore various commercially viable and profitable business opportunities based on past performance[84] Dividends and Shareholder Information - Alco Holdings Limited did not declare any dividends for the period, consistent with the previous year[3] - The company did not recommend any interim dividend for the six months ended September 30, 2022, consistent with the previous year[46] - Major shareholders include Liang Wei Cheng with 9.64% and Webb David Michael with 8.65% of the issued share capital[91] Future Outlook - ALCO HOLDINGS LIMITED reported a revenue of HKD 1.2 billion for the first half of 2022, representing a 15% increase year-over-year[102] - The company achieved a net profit of HKD 300 million, which is a 20% increase compared to the same period last year[102] - User data showed a growth in active users by 25%, reaching a total of 500,000 users[102] - The company plans to expand its market presence in Southeast Asia, targeting a 30% increase in market share by 2024[102] - ALCO is investing HKD 50 million in new product development, focusing on sustainable technology solutions[102] - The company has set a revenue guidance of HKD 2.5 billion for the full year 2022, indicating a projected growth of 10%[102] - ALCO's new strategic partnership with a leading tech firm is expected to enhance its product offerings and drive innovation[102] - The company reported a 5% increase in operational efficiency due to recent technological upgrades[102] - ALCO is exploring potential acquisitions to bolster its product portfolio and expand its customer base[102] - The company has developed valuable intellectual property, patents, and trademarks, including the Venturer tablet and Avita laptops, and is actively seeking new business opportunities[80] Other Income and Gains - Total other income and gains for the six months ended September 30, 2022, was HKD 63,997 thousand, significantly higher than HKD 3,497 thousand in 2021[48] - The gross loss margin slightly improved to 2.6%, down from 2.9% in the same period last year, primarily due to a strategic shift to a more cost-effective OEM/ODM production model[77] - The group entered a strategic investment agreement with Jasmy Incorporated to integrate secure IoT technology into its product line[82] - A distribution agreement was signed with Giken Sakata to alleviate cash flow pressure through bank financing[82]