Digit Wuhan Automotive Industrial Park No. 19 Changfu Industrial Park, Caidian Economic Development Zone EVA Precision Industrial Holdings Limited 億和精密工業控股有限 公 司 Wuhan, Hubei Province, the People's Republic of China 中國湖北省武漢市蔡甸經濟開發區常福工業園19號 數碼模武漢汽車產業園 Telephone 電話: 86-27 8661 9999 Facsimile 傳真: 86-27 8661 9999-209 Postcode 郵編: 430120 EVA Shenzhen (Tianliao) Smart Device Industrial Park Industrial District No. 9, Tian Liao Community, Yu Tang Town, Guang Ming District, Shenzhen, Guangdong Province, the People' ...

Financial Performance - The total revenue for the year ended December 31, 2024, was HKD 6,296,926, an increase of 1.83% from HKD 6,182,658 in 2023[3] - Gross profit for the same period was HKD 1,375,632, representing a gross margin of approximately 21.9%, compared to HKD 1,291,564 in 2023[3] - Operating profit decreased to HKD 372,689 from HKD 390,791, reflecting a decline of 4.3% year-over-year[3] - The net profit for the year was HKD 243,507, a slight increase of 2.0% from HKD 237,095 in 2023[3] - Basic and diluted earnings per share for the year were both HKD 14.0, up from HKD 13.6 in the previous year[3] - The group's annual profit before tax was HKD 276,386,000, a decrease of 9.05% compared to HKD 303,790,000 in the previous year[15] - Total expenses for 2024 amounted to HKD 5,932,973,000, a slight increase from HKD 5,878,121,000 in 2023, reflecting a growth of 0.9%[22] - The effective tax rate decreased to approximately 11.1% in 2024 from 18.6% in 2023, primarily due to changes in profitability across jurisdictions[24] - Basic earnings per share increased to HKD 14.0 in 2024 from HKD 13.6 in 2023, reflecting a growth of 2.9%[31] - The total dividend declared for 2024 was HKD 73,100,000, compared to HKD 71,203,000 in 2023, an increase of 2.7%[33] Assets and Liabilities - Total assets as of December 31, 2024, amounted to HKD 7,474,699, a marginal decrease from HKD 7,440,179 in 2023[4] - Current assets net value increased to HKD 1,500,405 from HKD 1,278,924, indicating a growth of 17.3%[5] - Total equity rose to HKD 3,141,921, up from HKD 2,997,714, reflecting an increase of 4.8%[5] - The group’s total liabilities as of December 31, 2024, were HKD 4,332,778,000, a slight decrease from HKD 4,442,465,000 in 2023[19] - Non-current assets totaled HKD 3,162,656,000, compared to HKD 3,121,503,000 in the previous year[20] Revenue Segmentation - The office automation equipment segment generated revenue of HKD 4,341,834,000, up from HKD 4,295,475,000, while the automotive parts segment increased to HKD 1,955,092,000 from HKD 1,887,183,000[15] - Revenue from office automation equipment increased by 1.1% to HKD 4,341,834,000, compared to HKD 4,295,475,000 in 2023[42] - The automotive parts segment's revenue increased by 3.6% to HKD 1,955,092,000, up from HKD 1,887,183,000 in 2023[46] Operational Highlights - The company has focused on high-precision manufacturing services, emphasizing the production of high-quality molds and components[6] - The company expects the new industrial park in Quang Ninh, covering approximately 60,000 square meters, to be completed and operational by early 2026, enhancing production capacity[43] - The company is actively expanding its D-EMS complete machine manufacturing project, with the first self-designed and developed product expected to start mass production in 2025[56] - The global demand for high-performance servers is increasing, with the company having developed 15 server projects, 13 of which are now in production[57] Customer and Market Insights - Major customers accounted for over 10% of external revenue, with Customer A contributing HKD 2,186,462,000 and Customer B contributing HKD 631,304,000 in 2024[20] - The largest customer accounted for 13.25% of accounts receivable in 2024, up from 12.5% in 2023, indicating increased concentration risk[35] - Revenue from Shenzhen increased by 3.6%, driven by higher orders from major clients Kyocera and Fujifilm[44] - The company reported a 12.2% decline in sales in Weihai due to sluggish domestic market conditions and changing consumer sentiment[44] Financial Management - Cash flow from operations increased significantly to HKD 862,394,000, driven by improved operating cash flow management[69] - The company maintained a prudent treasury policy, ensuring sufficient cash levels and credit facilities to support operational needs[70] - Current ratio increased from 1.42 in 2023 to 1.53 in 2024, reflecting improved liquidity management[75] - Net debt to equity ratio significantly decreased from 25.2% in 2023 to 15.0% in 2024, indicating a stronger financial position[75] Compliance and Governance - The company has adopted the standard code of conduct for securities transactions by directors, confirming compliance as of December 31, 2024[86] - The company has established an audit committee to review financial reporting, risk management, and internal control systems[88] - The public float of the company meets the requirements of the listing rules as of December 31, 2024[89] - The consolidated financial statements for the year ending December 31, 2024, have been audited by PwC, who are willing to continue their engagement[91] Employee and Operational Metrics - Total number of employees as of December 31, 2024, was 10,087, emphasizing the importance of skilled personnel in the company's operations[80] - Inventory turnover days remained stable at 48 days as of December 31, 2024[72] - Accounts receivable turnover days decreased from 107 days in 2023 to 104 days in 2024 due to improved credit control[73] - Cash conversion cycle decreased from 44 days in 2023 to 40 days in 2024, primarily due to the reduction in accounts receivable turnover days[74]

3 Feb 2025 CMB International Global Markets | Equity Research | Company Update EVA Holdings (838 HK) 2H24 preview: both revenue, NP stable HoH Maintain BUY. We project EVA's 2H24E revenue to rise 1% YoY and net profit to increase 2% YoY. We expect auto component revenue to grow faster in FY25E, as new business ramps up. We also expect its office automation (OA) business to remain stable with slight increase in gross margin. We estimate EVA's net profit to rise 18% YoY to HK$289mn in FY25E. We project 2H24E ...

Financial Performance - EVA Precision Industrial Holdings Limited reported a revenue increase of 15% year-over-year, reaching HKD 1.2 billion for the first half of 2024[8]. - The company achieved a net profit margin of 12%, translating to a net profit of HKD 144 million, up from HKD 120 million in the same period last year[8]. - Revenue for the six months ended June 30, 2024, was HKD 2,999,779, an increase from HKD 2,862,158 in the same period of 2023, representing a growth of approximately 4.8%[19]. - Gross profit for the period was HKD 602,664, compared to HKD 545,000 in 2023, reflecting a gross margin improvement[19]. - Net profit attributable to owners for the six months ended June 30, 2024, was HKD 127,813, up from HKD 122,624 in 2023, indicating a growth of about 4.8%[20]. - Total comprehensive income for the period was HKD 162,143, significantly higher than HKD 105,227 in the previous year, marking an increase of approximately 54%[20]. - Basic and diluted earnings per share for the period were both HKD 7.3, compared to HKD 7.0 in the same period last year, showing an increase of about 4.3%[20]. - Operating profit for the same period rose by 3.7% year-on-year to HKD 195,982,000, up from HKD 189,006,000 in the previous year[114]. - Profit attributable to shareholders increased by 4.2% year-on-year to HKD 127,813,000, compared to HKD 122,624,000 for the same period in 2023[114]. Market Expansion and Strategy - User data indicates a 20% increase in active customers, totaling 500,000 users across all platforms[8]. - The company plans to expand its market presence in Southeast Asia, targeting a 25% growth in that region by the end of 2025[8]. - EVA is investing HKD 200 million in R&D for new smart device technologies, aiming to launch two new products by Q3 2024[8]. - The company has completed the acquisition of a local competitor, which is expected to enhance its production capacity by 30%[8]. - EVA's future guidance estimates a revenue growth of 10-15% for the full year 2024, driven by increased demand in the automotive sector[8]. - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[41]. - The company aims to enhance its product offerings and technological advancements through ongoing research and development initiatives[195]. - EVA is focused on expanding its market presence in the automotive sector, particularly in electric vehicle components[195]. Sustainability and Efficiency - EVA is focusing on sustainability initiatives, with a goal to reduce carbon emissions by 15% by 2025[8]. - The company reported a 5% increase in production efficiency due to the implementation of new manufacturing technologies[8]. - The group maintained a focus on cost control and efficiency improvements, implementing lean production in industrial parks and enhancing inventory management[114]. - The company has initiated a series of measures to enhance sustainable development, including linking bank loans to sustainability performance and balancing debt repayment with business growth[123]. Financial Position and Assets - Total assets as of June 30, 2024, were HKD 4,243,153, a slight decrease from HKD 4,318,676 as of December 31, 2023[21]. - Current assets net value decreased to HKD 1,150,173 from HKD 1,278,924 at the end of 2023, indicating a decline of approximately 10%[22]. - Total liabilities as of June 30, 2024, were HKD 3,092,980, compared to HKD 3,039,752 at the end of 2023, reflecting an increase of about 1.75%[21]. - The company's equity increased to HKD 3,125,212 as of June 30, 2024, from HKD 2,997,714 at the end of 2023, representing a growth of approximately 4.3%[22]. - Cash and cash equivalents as of June 30, 2024, were HKD 1,666,299, up from HKD 1,610,592 at the end of 2023, indicating an increase of about 3.5%[21]. - The company reported a foreign exchange gain of HKD 35,575,000 on cash and cash equivalents, compared to a loss of HKD 6,968,000 in the previous year[26]. - The company’s total borrowings amounted to HKD 604,861,000, a decrease from HKD 661,975,000 in the same period last year, representing a decline of 8.6%[26]. - As of June 30, 2024, the total assets of the company amounted to HKD 7,370,670,000, while total liabilities were HKD 4,245,458,000[51]. Operational Highlights - The company continues to focus on high-precision manufacturing services, emphasizing the production of high-quality and dimensionally accurate molds and components[27]. - The automotive parts segment reported revenue of HKD 943,078 for the six months ended June 30, 2024, compared to HKD 854,912 in the same period last year, reflecting an increase of approximately 10.3%[45]. - The office automation equipment segment generated revenue of HKD 2,056,701 for the six months ended June 30, 2024, up from HKD 2,007,246 in the prior year[45]. - The company has established strategic partnerships with three major automotive manufacturers to enhance its supply chain capabilities[8]. - The company has launched seven server projects that have officially commenced production in the first half of 2024, leveraging its global production layout and strong R&D capabilities[123]. Customer and Supplier Relations - The revenue from the largest customer, which accounted for over 10% of the group's revenue, was approximately HKD 1,002,813,000 for the six months ending June 30, 2024[53]. - As of June 30, 2024, sales to the top five customers accounted for 63.7% of the total revenue, indicating a significant reliance on these clients[152]. - The company has established long-term relationships with its top five customers, ranging from 7 to over 10 years, and with its top five suppliers, ranging from 4 to over 10 years[152]. - The company actively engages in supplier selection based on integrity, social responsibility, and environmental impact, ensuring compliance with international best practices[151]. Shareholder and Governance - Major shareholder Zhang Yao Hua holds a personal interest of 47.07% in the company, while Zhang Jie holds 52.93% in Prosper Empire Limited, which owns 38.70% of the company[177][178]. - The company has complied with the corporate governance code as per the listing rules during the six months ending June 30, 2024[186]. - The audit committee, consisting of three independent non-executive directors, has reviewed the financial reporting procedures and internal controls for the group[188]. - The company has adopted the standard code for securities transactions by directors, confirming compliance by all directors during the reporting period[187]. Future Outlook - The company anticipates a strong recovery in orders from Vietnam in the second half of 2024 as inventory destocking is nearly complete[115]. - The company aims to consolidate its market leadership position and achieve sustainable growth despite market volatility and geopolitical complexities[1]. - The company will explore opportunities for capacity and business expansion to enhance business diversity and long-term growth[1].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price adjusted to HK$1.40 from HK$1.50 [2][4]. Core Insights - The company is transitioning towards becoming a first-tier supplier in the automotive parts sector, which is expected to enhance revenue from OEM orders in FY25 [1]. - Despite a cautious approach to maintain gross profit margins (GPM), revenue and net profit forecasts for FY24 have been reduced by 3% and 9% respectively, but the earnings outlook for FY25 appears more promising [1]. - The company anticipates a 15% year-on-year growth in automotive parts revenue for FY25, reaching HK$2.34 billion [1]. - The office automation (OA) segment's gross profit margin expanded by approximately 1 percentage point in the first half of 2024, with a projected continued improvement in the second half [1]. Financial Summary - Revenue projections for FY24 are lowered to HK$6.38 billion, with net profit estimates adjusted to HK$260 million [1][7]. - For FY25, revenue is expected to grow to HK$6.86 billion, with net profit forecasted at HK$301 million, reflecting a 15% increase in operating profit [1][8]. - The company maintains a dividend payout ratio of 30%, resulting in a projected dividend yield of 7% [1][2]. Valuation Metrics - The estimated price-to-earnings (P/E) ratio for FY25 is set at 11 times, with a valuation of HK$0.50 per share for the automotive components segment and HK$0.90 per share for the OA segment [2][9]. - The overall sum-of-the-parts (SOTP) valuation suggests a target price of HK$1.40, indicating a potential upside of 118.8% from the current price of HK$0.64 [4][9]. Revenue and Profitability Forecasts - Revenue is projected to grow from HK$6.38 billion in FY24 to HK$6.86 billion in FY25, and further to HK$7.23 billion in FY26 [3][7]. - Net profit is expected to increase from HK$260 million in FY24 to HK$301 million in FY25, and HK$327 million in FY26 [3][7]. - The gross profit margin is forecasted to stabilize around 21% for FY24 to FY26 [7][8]. Market Performance - The stock has shown a decline of 4.5% over the past month and 9.9% over the past three months, indicating a challenging market environment [4].

13 Sep 2024 CMB International Global Markets | Equity Research | Company Update EVA Holdings (838 HK) On track to tier-1 supplier transformation We believe that EVA's auto parts business is on track to transform into a tier-1 supplier with more orders from OEMs to lift FY25E revenue, based on our recent meeting with management. Although we cut our FY24E revenue and NP by 3% and 9%, respectively, amid its cautious approach to maintain GPM, we see higher earnings visibility in FY25E. We estimate its dividend ...

Financial Performance - Revenue for the six months ended June 30, 2024, was HKD 2,999,779, an increase of 4.8% compared to HKD 2,862,158 for the same period in 2023[2] - Gross profit for the period was HKD 602,664, representing a gross margin of 20.1%, up from HKD 545,000 and a margin of 19.0% in the previous year[2] - Operating profit increased to HKD 195,982, compared to HKD 189,006 in the prior year, reflecting a growth of 4.2%[2] - Net profit attributable to owners for the period was HKD 127,813, a rise of 4.8% from HKD 122,624 in the same period last year[2] - Basic and diluted earnings per share for the period were both HKD 7.3, compared to HKD 7.0 in the previous year[2] - The company reported a profit before tax of HKD 141,051 for the first half of 2024, compared to HKD 144,082 for the same period in 2023[11] - The profit for the automotive parts division was HKD 51,806,000 in the first half of 2024, with a profit margin of 5.5%, down from 5.8% in the same period of 2023[34] - The profit attributable to the company's owners for the period was HKD 127,813,000, an increase from HKD 122,624,000 in the first half of 2023, primarily due to increased gross profit[46] Assets and Liabilities - Total assets as of June 30, 2024, were HKD 3,127,517, slightly up from HKD 3,121,503 as of December 31, 2023[3] - Total liabilities decreased to HKD 4,243,153 from HKD 4,318,676 at the end of 2023, indicating a reduction of approximately 1.7%[3] - Non-current liabilities, specifically bank loans, decreased to HKD 1,063,619 from HKD 1,321,006, a reduction of about 19.5%[4] - The company's net asset value increased to HKD 3,125,212 from HKD 2,997,714, reflecting a growth of approximately 4.3%[4] - Total liabilities as of June 30, 2024, were HKD 4,245,458, down from HKD 4,442,465 at the end of 2023, reflecting a reduction in overall liabilities[12][16] Revenue Segmentation - The office automation equipment segment generated revenue of HKD 2,056,701 for the first half of 2024, while the automotive parts segment generated HKD 943,078[11] - Revenue from China was HKD 2,241,238, accounting for approximately 74.7% of total revenue, while revenue from Vietnam and Mexico were HKD 376,883 and HKD 381,658, respectively[17] - Revenue from the office automation equipment segment increased by 2.5% year-on-year to HKD 2,056,701,000, compared to HKD 2,007,246,000 in the first half of 2023[28] - The automotive parts division recorded a revenue increase of 10.3% year-on-year, reaching HKD 943,078,000 in the first half of 2024, compared to HKD 854,912,000 in the same period of 2023[30] Customer and Market Insights - The largest customer accounted for approximately HKD 1,002,813,000 in revenue for the six months ended June 30, 2024, compared to HKD 1,274,198,000 from two largest customers in the same period of 2023[16] - The five largest customers accounted for 34.66% of accounts receivable as of June 30, 2024, down from 49.15% as of December 31, 2023, indicating reduced concentration risk[25] - The Shenzhen office automation equipment sales rose by 11.3% year-on-year, driven by increased orders from major clients[28] - Wuhan's sales saw a significant increase of 51.1% year-on-year in the first half of 2024, supported by the ramp-up of the Great Wall Motors project and new customer acquisitions[31] Operational Efficiency - The cost of sales for the six months ended June 30, 2024, was HKD 1,795,752, up from HKD 1,745,980 in the same period of 2023[19] - The overall gross profit margin improved by 1.1 percentage points to 20.1%, up from 19.0% in the same period last year[27] - Inventory turnover days improved to 43 days from 48 days, attributed to increased production and shipping volumes[49] - The operating profit margin for the office automation equipment business slightly decreased to 8.0% from 8.2% in the previous year, primarily due to the absence of one-time gains recognized in the prior period[41] Future Outlook and Strategy - The company expects no significant impact on its consolidated financial statements from the new accounting standards that will take effect in the coming years[9] - The company is currently evaluating the financial impact of the new accounting standards and will adopt them upon their effective date[9] - The group plans to build a new industrial park in Quang Ninh Province, Vietnam, covering approximately 60,000 square meters, expected to be completed in 2025[28] - The company anticipates a stable economic growth rate of 3.2% for the next two years, with inflation expected to decrease from 2.8% at the end of 2024 to 2.4% at the end of 2025[34] Dividends and Shareholder Returns - The company declared an interim dividend of HKD 0.022 per share, totaling HKD 38,300,000, an increase from HKD 36,559,000 in the previous year[24] - The board declared an interim dividend of HKD 0.022 per share, totaling HKD 38,300,000, to be paid on September 26, 2024[61] Corporate Governance and Compliance - The audit committee has reviewed the group's financial reporting procedures and internal controls[65] - The group has complied with the corporate governance code as per the listing rules during the reporting period[64]

Investment Rating - The report maintains a "Buy" rating for EVA Holdings, indicating a potential return exceeding 15% over the next 12 months [1][28]. Core Insights - EVA Holdings is transitioning from a secondary parts supplier to a primary participant, which is expected to drive growth in the coming years. The company's automation business is projected to maintain stable gross margins due to growth in Weihai and recovery in Vietnam [1][32]. - The automotive parts revenue is expected to grow at a compound annual growth rate (CAGR) of 15% from FY24 to FY25, with management targeting HKD 2.2 billion in automotive parts revenue for FY24 [1][32]. - The report highlights the importance of partnerships with primary suppliers in the new hot forming business, which could enhance EVA's profitability and revenue per vehicle [1][32]. Financial Summary - Revenue for FY24E is projected at HKD 6.571 billion, with a year-on-year growth of 6.3%. Net profit is expected to reach HKD 285 million, reflecting a 20.3% increase [20][34]. - The gross profit margin (GPM) for automotive parts is anticipated to be 21.8% in FY24E, supported by increased capacity and reduced capital expenditures [32][34]. - EVA's net profit for the first half of FY24 is expected to grow by 15% year-on-year, reaching HKD 141 million, with an overall net profit forecast of HKD 285 million for FY24 [1][32]. Valuation - The target price for EVA Holdings is set at HKD 1.50, based on a sum-of-the-parts (SOTP) valuation. The automotive parts business is valued at HKD 0.50 per share, while the office automation business is valued at HKD 1.00 per share [32][34]. - The report notes that the valuation reflects a revised FY24E price-to-earnings (P/E) ratio of 13 times, up from 11 times previously [32][34].

Disclosures & Disclaimers Analyst Certification The research analyst who is primary responsible for the content of this research report, in whole or in part, certifies that with respect to the securities or issuer that the analyst covered in this report: (1) all of the views expressed accurately reflect his or her personal views about the subject securities or issuer; and (2) no part of his or her compensation was, is, or will be, directly or indirectly, related to the specific views expressed by that analy ...

Awards and Recognitions - Segway-Ninebot awarded the company "2019 Best Supplier" and "2019 Joint Innovation Award"[3] - Canon awarded the company "First Prize in the 24th Comprehensive Assembly Capability Invitational Competition"[2] - The company was ranked among "2019 Guangdong Top 500 Enterprises", "2019 Guangdong Top 100 Private Enterprises", and "2019 Guangdong Top 100 Manufacturing Enterprises"[32] - Fujifilm awarded the company "Excellent Partner (2020 - 10 Years Consecutive Award)"[30] - The company was ranked among "2021 Guangdong Top 500 Enterprises"[64] - The company was awarded "2021 Most Potential Supplier" by Great Wall Motors Chongqing Branch[46] - The company was recognized as "2021 Guangdong Provincial Intellectual Property Demonstration Enterprise"[54] - The company was awarded "2020 Best Quality Award" by Mitac[63] - The company was ranked among "2020 Shenzhen Top 500 Enterprises"[43] - The company was awarded "2021 Cooperative Supplier Award" by Aisin Foshan Body Parts Co., Ltd.[49] - The company was awarded the "Best Under a Billion" by Forbes (Asia) magazine[168] - The company received the "Excellence in Manufacturing Achievement Award" from the Hong Kong Federation of Innovation Technology and Manufacturing Industries in 2012[182] - The company's Shenzhen Yihao Mold Manufacturing Co., Ltd. and Chongqing Digital Mold Body Mold Co., Ltd. were certified as "National High-Tech Enterprises"[183] Financial Performance - Inventory turnover days increased to 48 days in 2023 from 46 days in 2022 due to overall production decline[87] - Accounts receivable turnover days rose to 107 days in 2023 from 98 days in 2022[87] - Accounts payable turnover days increased to 111 days in 2023 from 108 days in 2022[87] - Cash conversion cycle extended to 44 days in 2023 from 36 days in 2022[87] - Net debt to equity ratio increased to 25.2% in 2023 from 21.0% in 2022[87] - Net profit margin improved to 3.8% in 2023 from 3.3% in 2022[87] - Return on equity increased to 7.9% in 2023 from 7.3% in 2022[87] - The company's net profit margin and return on equity increased due to higher owner's attributable profit[133] - The company's profit attributable to owners for 2023 was HKD 237,095,000, up from HKD 206,017,000 in 2022, primarily due to increased operating profit[200] Business Operations - The company operates two main businesses: office automation equipment and automotive components, with manufacturing bases in China, Southeast Asia, and North America[121] - The office automation equipment business provides design and electronic manufacturing services (D-EMS) for leading brands, offering a one-stop solution from product design to assembly[121] - The automotive components business focuses on platformization, supplying platform and universal parts to global Tier 1 suppliers, OEMs, and automakers[121] - The company has six industrial parks for office automation equipment in Shenzhen, Suzhou, Weihai, and Haiphong, Vietnam[121] - The automotive components business operates in six industrial parks located in Shenzhen, Zhongshan, Chongqing, Sichuan, Wuhan, and San Luis Potosí, Mexico[121] - The company operates as a vertically integrated one-stop precision manufacturing service provider, specializing in precision metal stamping, plastic injection molds, and automated assembly[136] Historical Development - The company was established in 1993, starting with metal stamping mold production and later expanding to metal stamping parts[125] - In 2005, the company was listed on the Main Board of the Hong Kong Stock Exchange[127] - The company expanded its business to plastic mold and parts manufacturing in 2004, establishing its first plastic production line in the Shenzhen (Shiyan) Electronics Industrial Park[127] - The company's Yihao (Guangming) Precision Manufacturing Industrial Park in Shenzhen began operations in Q4 2008[142] - The company acquired Chongqing Digital Mold Body Mold Co., Ltd. in mid-2011 as part of its strategic plan to expand into the automotive market[159] - The company's Shenzhen (Shiyan) Electronic Industrial Park's fourth factory building was completed[160] Market and Economic Outlook - The company expects global economic growth to be 2.9% in 2024, lower than 2023, and will continue to adopt a conservative financial strategy[105] - Global demand weakness and excessive terminal inventory led to a decline in the company's business, but order trends improved in the second half of 2023, with revenue starting to rise from October to December 2023[187] Automotive Business Performance - Shenzhen automotive parts business revenue decreased by 5.6% year-on-year in 2023 due to European inflation[98] - Mexico industrial park revenue grew by 23.8% in 2023, the best-performing region for automotive parts business[103] - The company's automotive parts business achieved stable growth, with China's overall car sales reaching 30.094 million units in 2023, a 12% year-on-year increase, and new energy vehicle sales reaching 9.495 million units, a 37.9% year-on-year increase[193] - The operating profit margin of the company's office automation equipment business increased to 7.9% in 2023, up from 5.6% in 2022, while the automotive parts business maintained an operating profit margin of 5.8%[194] Financial Expenses and Taxes - Unallocated expenses for the year ended December 31, 2023, included corporate expenses of HKD 44,847,000 and share-based payment expenses of HKD 10,454,000[195] - The company's financial income and expenses increased significantly in 2023 due to rising interest rates[196] - Income tax expenses for 2023 included current tax expenses of HKD 50,346,000 from Mainland China, HKD 7,402,000 from Vietnam, and HKD 16,195,000 from Mexico[199]