Financial Performance - The company's total revenue for 2022 was HKD 4,354.7 million, representing a growth rate of 15.3% compared to the previous year[14]. - The profit attributable to shareholders was HKD 582.0 million, a significant increase of 52.0% compared to the previous year[41]. - Adjusted profit attributable to shareholders reached HKD 649.1 million, reflecting a growth of 53.7% year-on-year[41]. - Basic earnings per share increased to HKD 30.9, up 52.2% from HKD 20.3 in the previous year[41]. - The company declared a total dividend of HKD 16.0 per share, a substantial increase of 58.4% compared to HKD 10.1 per share last year[41]. - EBITDA for the year was HKD 1,165.5 million, an increase of 28.1% from HKD 910.0 million in the previous year[41]. - The net cash generated from operating activities was HKD 837.5 million, a significant increase of 97.3% year-on-year[41]. - Total debt rose to HKD 2,205.9 million, a 42.8% increase from HKD 1,544.9 million in the previous year[41]. - The company's market capitalization increased by 20.1% to HKD 4,183.7 million from HKD 3,484.1 million[41]. - The adjusted return on equity was 14.9%, up from 10.1% in the previous year[41]. Revenue Breakdown - The revenue breakdown by business segment shows that investment casting accounted for 43.6% of total revenue, making it the largest segment[20]. - The group generated 34.1% of its revenue from precision machining parts and others for the year ended December 31, 2022[22]. - Sand casting accounted for 18.8% of the group's revenue for the year ended December 31, 2022[24]. - Surface treatment services contributed 3.5% to the group's revenue for the year ended December 31, 2022[26]. - Approximately 50% of precision machining products were sold to Europe, with about one-third to the Americas and the remainder to Asia, including China[23]. - About 50% of sand castings were sold to the Americas, approximately one-third to Asia, including China, and the rest to Europe[25]. Acquisitions and Investments - The group completed the acquisition of hydraulic cycloidal motor business from Danfoss Jiangsu in November 2022[34]. - The group completed the acquisition of Foshan Meiduan Manufacturing Technology Co., Ltd. for RMB 56.6 million (approximately HKD 65.8 million) on August 15, 2022[110]. - The group acquired the hydraulic gear motor business from Danfoss Power Systems (Jiangsu) Co., Ltd. for RMB 442.2 million (approximately HKD 483.6 million), completed on October 31, 2022[111]. - The group’s new investment in the Mexico SLP plant for precision casting began production in December 2022[34]. - The company plans to continue expanding its market share in North America by leveraging the geographical advantages of its Mexican factories[64]. Operational Highlights - The company developed over 1,100 new active part numbers in collaboration with customers in 2022, increasing the total active part numbers to over 8,500[18]. - The company operates 21 production facilities globally, with 19 currently in operation and 2 under construction[19]. - The company has a workforce of over 7,700 employees, including approximately 700 engineers from around the world[18]. - The company is recognized as the sixth largest independent investment casting manufacturer globally and the largest in China[14]. - The company aims to provide a one-stop solution that includes R&D, mold design and manufacturing, casting, heat treatment, secondary machining, and surface treatment[14]. Market Performance - Revenue from the Americas grew by 35.5% to HKD 2,123.0 million, while European revenue increased by 17.0% to HKD 1,358.4 million; Asian revenue fell by 16.8% to HKD 873.3 million[62]. - Passenger vehicle segment revenue declined by 17.0% to HKD 803.5 million due to weak demand in Europe and supply chain constraints, while commercial vehicle revenue grew by 18.7% to HKD 896.0 million[51]. - The sand casting business achieved a strong growth of 41.0%, while the investment casting business grew by 22.1%, driven by demand in aerospace, medical, and energy sectors[56]. Sustainability and ESG Efforts - The company achieved a 21.8% reduction in energy consumption per unit of revenue and a 19.9% decrease in greenhouse gas emissions per unit of revenue in 2022, reflecting its commitment to ESG principles[69]. - The company has set sustainability goals to reduce energy density, greenhouse gas emissions density, and water consumption density by 30%, 30%, and 40% respectively by 2030[145]. - The company issued an independent ESG report detailing its sustainability performance, aligning with global reporting standards[143]. - The company has established sustainability standards and is committed to monitoring and reporting its performance annually[184]. Corporate Governance - The board consists of five executive directors and three independent non-executive directors, ensuring strong independence in its composition[153]. - The audit committee, composed entirely of independent non-executive directors, held three meetings during the year, with full attendance from all members[168]. - The company has established a formal and transparent nomination policy for selecting and appointing new directors, with all directors required to retire at least once every three years[161]. - The board emphasizes the importance of diversity in its composition, considering factors such as gender, age, cultural background, and industry experience[156]. - The company is committed to enhancing gender diversity in its senior management and will continue to seek suitable candidates for future appointments[158]. Financial Management - The effective tax rate decreased to 15.4% from 17.7% in the previous year, influenced by deferred tax assets recognition[88]. - Total assets increased by 10.2% to HKD 7,763.0 million as of December 31, 2022, primarily due to two acquisitions and capital expenditures related to the New Mexico plant[98]. - The current ratio as of December 31, 2022, was 1.63, down from 1.74 as of December 31, 2021, due to increased short-term bank loans to support capital expenditures[98]. - The net debt-to-equity ratio increased to 39.2% as of December 31, 2022, compared to 22.1% the previous year, driven by higher borrowings for acquisitions and capital expenditures[104]. Employee and Remuneration - Total employee costs for the year amounted to HKD 1,115.3 million, an increase from HKD 1,091.0 million in the previous year[115]. - The total remuneration for executive directors for the year ended December 31, 2022, amounted to HKD 17,316,000, which includes salaries, allowances, and bonuses[186]. - The five highest-paid individuals in the group received a total remuneration of HKD 17,976,000, with bonuses contributing HKD 4,241,000[190].

Financial Performance - Revenue for the six months ended June 30, 2022, was HKD 2,192.7 million, representing a 20.2% increase from HKD 1,823.9 million in the same period of 2021[20] - Adjusted net profit attributable to shareholders for the same period was HKD 335.0 million, a 56.4% increase from HKD 214.2 million in 2021[21] - Basic earnings per share increased by 53.1% to HKD 14.22 from HKD 9.29 year-on-year[20] - EBITDA for the six months was HKD 563.1 million, with an EBITDA margin of 25.9% compared to 24.5% in the previous year[20] - The profit attributable to shareholders for the same period was HKD 267.7 million, a significant increase of 53.0% year-on-year[26] - Adjusted profit attributable to shareholders, excluding one-time impairment losses and other adjustments, was HKD 335.0 million, reflecting a substantial growth of 56.4%[26] - The adjusted EBITDA for the six months was HKD 638.5 million, compared to HKD 477.4 million in the previous year, marking a 33.7% increase[26] - Gross profit rose by 29.1% to HKD 643.3 million, with a gross margin of 29.3%, up from 27.3% in the previous year[41] - Operating profit increased by 43.8% to HKD 349.5 million, resulting in an operating margin of 15.9%, compared to 13.3% in the prior year[39] - Net profit for the period was HKD 268.0 million, reflecting a 51.8% increase from HKD 176.6 million in the same period last year[39] Market Performance - The aerospace and medical end markets saw the most significant growth, with a revenue increase of 38.3% to HKD 195.3 million[27] - The industrial and other components business maintained strong growth, with revenue rising 35.8% to HKD 1,067.7 million[28] - The North American market showed strong performance in sectors like large engines and agricultural machinery, contributing to revenue growth[26] - Revenue from sand casting business increased by 53.9% to HKD 380.6 million, driven by strong demand in the Americas and Europe[32] - Revenue from the Americas surged by 45.8% to HKD 1,046.4 million, while European revenue grew by 10.8% to HKD 672.2 million[34] Challenges and Risks - The company faced challenges from the Russo-Ukrainian war and domestic COVID-19 outbreaks, impacting production and sales[26] - The company reported a 6.5% decline in revenue from the passenger vehicle market due to the fire incident at the Nantong factory[29] - Surface treatment business revenue declined by 16.9% to HKD 123.5 million, impacted by a fire incident and COVID-19 lockdowns[32] Cash Flow and Financial Position - Cash and cash equivalents increased by 30.2% to HKD 753.9 million from HKD 579.0 million as of December 31, 2021[20] - The company reported a free cash flow of HKD 8.6 million, a significant improvement from a cash outflow of HKD 260.2 million in the previous year[20] - Cash flow from operating activities rose to HKD 443.0 million, up 42.5% from HKD 311.0 million in the previous year[56] - Cash used in investing activities decreased to HKD 434.4 million from HKD 571.2 million, primarily due to reduced capital expenditures[56] - Cash flow from financing activities increased significantly to HKD 191.4 million from HKD 45.3 million, driven by higher bank loan proceeds[58] - Total debt rose by 21.5% to HKD 1,876.9 million from HKD 1,544.9 million in the previous year[20] Acquisitions and Investments - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[20] - The acquisition of Foshan Meiduan Manufacturing Technology Co., Ltd. aims to strengthen the company's position in the aviation market[35] - The company announced the acquisition of Danfoss Power Systems (Jiangsu) Co., Ltd.'s hydraulic gear motor business to enhance its capabilities in the hydraulic sector[36] - The group has contracted but unutilized capital commitments of HKD 233.3 million, primarily related to factory construction and machinery purchases[61] Corporate Governance - The chairman and CEO roles are held by the same individual, Mr. Lu Ruibo, which the board believes is beneficial for management despite a deviation from corporate governance code A.2.1[71] - The company has adopted the corporate governance code and has complied with all provisions, except for the aforementioned deviation regarding the chairman and CEO roles[71] - The board consists of five executive directors and three independent non-executive directors, ensuring a strong level of independence[71] - Major shareholders, excluding Mr. Lu and his controlled entities, have disclosed their interests in the company's shares as required by the Securities and Futures Ordinance[77] Employee and Shareholder Information - The total employee cost for the six months ended June 30, 2022, was HKD 571.5 million, compared to HKD 547.1 million for the same period in 2021[66] - The company declared an interim dividend of HKD 0.08 per share, a substantial increase of 175.9% compared to the previous year[26] - Major shareholders include Impro Development with 1,213,118,787 shares (64.41%) and Mr. Lu with 1,222,357,787 shares (64.91%) [78] Stock Options and Incentives - The company has a stock option plan that allows eligible participants to purchase shares at a discount of 20% from the offering price [81] - The stock options granted to directors and employees have an exercise price of HKD 2.4 per share, with a total of 25,692,500 options unexercised as of June 30, 2022 [83] - The company aims to incentivize employees through the stock option plan to enhance future performance [82] Audit and Compliance - The independent auditor has reviewed the interim financial report for the six months ending June 30, 2022, and found no significant issues[92] - The company’s external auditor, KPMG, conducted the review in accordance with the relevant standards and did not express an audit opinion[91] - The company has maintained its accounting policies consistent with those adopted in the annual financial statements for the year ended December 31, 2021[106]

Financial Performance - Revenue growth rate for the year was 29.2%[16] - The company's revenue for the year ended December 31, 2021, was HKD 3,777.7 million, an increase of 29.2% compared to HKD 2,924.6 million in 2020[33] - The profit attributable to shareholders was HKD 382.8 million, a significant increase of 358.3% from a loss of HKD 148.2 million in the previous year[33] - Adjusted profit attributable to shareholders rose by 34.7% to HKD 422.2 million from HKD 313.4 million in 2020[33] - Basic earnings per share increased to HKD 0.203 from a loss of HKD 0.079, representing a growth of 357.0%[33] - EBITDA for the year was HKD 910.0 million, up 155.1% from HKD 356.7 million in 2020[33] - Gross profit rose by 33.2% to HKD 1,022.4 million, with a gross margin of 27.1%, up from 26.2% in the previous year[54][58] - Operating profit surged to HKD 493.0 million, a significant increase of 1,640.6% from a loss of HKD 32.0 million in 2020[54] - Adjusted profit before tax was HKD 468.6 million, compared to a loss of HKD 52.8 million in the prior year, reflecting a 987.5% increase[54][55] Revenue Breakdown - The investment in the precision casting segment accounted for 41.2% of the total revenue for the year ended December 31, 2021[21] - The precision machining segment contributed 35.4% to the total revenue for the year ended December 31, 2021[21] - The sand casting segment represented 15.3% of the total revenue for the year ended December 31, 2021[22] - Surface treatment services accounted for 8.1% of the total revenue for the year ended December 31, 2021[23] - Over half of the precision castings were sold to the Americas, followed by Europe and Asia (including China) in 2021[21] - Approximately half of the precision machining products were sold to Europe, with about one-third to the Americas and the remainder to Asia (including China) in 2021[21] - The majority of surface treatment customers were from the Chinese passenger vehicle market in 2021[23] Market Presence and Operations - The company employs over 7,100 staff, including approximately 700 engineers from around the world[17] - The company has established a global footprint with 19 production facilities across China, Turkey, Germany, the Czech Republic, and Mexico, of which 15 are operational and 4 are under construction[20] - The company serves over 1,000 customers from more than 30 countries and regions[17] - The company has nine sales offices and storage capabilities in China, the USA, Luxembourg, Germany, Turkey, and Mexico[20] - The company aims to become a global leader in providing high-precision, high-complexity, and performance-critical components and solutions[3] - The company has established long-term strategic partnerships with multiple globally recognized industry leaders[13] Challenges and Strategic Initiatives - The company faced challenges due to the ongoing COVID-19 pandemic, impacting demand in various markets, but strong demand from U.S. customers helped maintain sales momentum in the second half of the year[39] - The company is expanding its manufacturing capabilities in Mexico, with five factories nearing completion and starting production, contributing to the positive financial outlook[38] - The company established the "Eagle Precision Aviation Technology Division" in July 2021[30] - The merger of two German factories under BFG Group was completed in December 2021, renaming it BFG Feinguss GmbH[30] Sustainability and Corporate Governance - The company’s comprehensive energy consumption per unit of revenue decreased by 2.2% year-on-year, while greenhouse gas emissions per unit of revenue reduced by 1.9%[50] - The company plans to enhance its R&D capabilities to provide more diversified customized products and services, aiming for sustainable profit growth[51] - The company received over HKD 400 million in green loans from DBS Bank and Citibank to support energy investments in 2021[98] - The company has established an "Aerospace Technology Division" in July 2021 to better serve the aerospace and medical markets[49] - The company plans to release an independent ESG report detailing its sustainable development performance, following guidelines from the Hong Kong Stock Exchange[98] Shareholder Returns and Dividends - The company declared a total dividend of HKD 0.101 per share for the year, a 140.5% increase from HKD 0.042 per share in the previous year[38] - The company maintained a policy to distribute no less than 25% of the attributable profit to shareholders as dividends, subject to operational needs and future business expansion plans[162] - The company declared an interim dividend of HKD 0.029 per share, totaling HKD 54.6 million, paid on September 10, 2021[161] - A second interim dividend of HKD 0.072 per share, approximately HKD 135.6 million, is expected to be paid on April 8, 2022[161] Management and Employee Insights - The company has established an investor relations department to facilitate communication with analysts, institutional investors, and shareholders, providing necessary operational and strategic information[143] - The management team emphasized the importance of sustainability initiatives, aiming for a 40% reduction in carbon emissions by 2025[150] - The company has introduced two new product lines, which are anticipated to contribute an additional $50 million in revenue annually[149] - The management team collectively brings over 100 years of experience in industrial engineering and business development, enhancing the company's strategic capabilities[155] Financial Position and Debt - Total debt increased by 80.9% to HKD 1,544.9 million from HKD 853.8 million in 2020[33] - Net debt surged by 283.6% to HKD 965.9 million from HKD 251.8 million in the previous year[33] - The debt-to-equity ratio as of December 31, 2021, was 22.1%, up from 6.2% the previous year, driven by increased working capital and capital expenditures for the Mexican factory[76] - Total borrowings increased by HKD 691.1 million to HKD 1,544.9 million as of December 31, 2021, compared to HKD 853.8 million the previous year[74] Audit and Compliance - The audit committee held four meetings during the year, with all members present at each meeting[113] - The audit committee is responsible for reviewing the company's financial controls, internal controls, and risk management systems[113] - The independent non-executive directors have confirmed their independence according to the listing rules[104] - The company maintained an effective internal control and enterprise risk management system throughout the year, ensuring compliance with relevant laws and regulations[136]

Financial Performance - Revenue for the six months ended June 30, 2021, was HKD 1,823.9 million, representing a 33.3% increase from HKD 1,368.6 million in 2020[18] - Gross profit increased to HKD 498.3 million, up 36.2% from HKD 365.9 million, with a gross margin of 27.3% compared to 26.7% in the previous year[18] - Shareholders' profit attributable to the company was HKD 175.0 million, a significant turnaround from a loss of HKD 269.9 million in 2020, marking a 164.8% improvement[18] - Adjusted EBITDA for the six months was HKD 477.4 million, a 16.5% increase from HKD 409.8 million in the same period last year[21] - Adjusted profit attributable to shareholders increased by 17.1% to HKD 214.2 million, with adjusted basic earnings per share at HKD 0.1137[24] - The profit attributable to shareholders was HKD 175.0 million, a turnaround from a loss of HKD 269.9 million in the previous year, primarily due to a significant impairment loss of HKD 444.2 million in the prior period[24] - The company reported a net loss of HKD 37.3 million in other losses, primarily due to severance costs related to the closure of a German production facility[41] - The company reported a profit of HKD 176,581,000 for the six months ended June 30, 2021, compared to a loss of HKD 268,251,000 in the same period of 2020, marking a significant turnaround[96] - Total comprehensive income for the period was HKD 200,045,000, compared to a total comprehensive loss of HKD 373,536,000 in the previous year[96] Debt and Cash Flow - The company reported a net debt of HKD 556.8 million, which is a 121.2% increase from HKD 251.8 million as of December 31, 2020[18] - Cash and cash equivalents decreased by 35.6% to HKD 387.4 million from HKD 602.0 million[18] - The company’s total debt rose by 10.6% to HKD 944.2 million from HKD 853.8 million[18] - Cash flow from operating activities decreased by HKD 141.4 million to HKD 311.0 million, mainly due to increased working capital requirements[55] - The net debt-to-equity ratio as of June 30, 2021, was 13.2%, up from 6.2% at the end of 2020, due to increased borrowings for the Mexico factory[60] - The company’s bank loan proceeds amounted to HKD 486,857,000, while repayments were HKD 377,599,000, resulting in a net cash inflow from financing activities of HKD 45,337,000[103] Revenue Segmentation - Revenue from the automotive end market reached a historical high of HKD 896.5 million, representing a 50.2% year-on-year increase, driven by the implementation of China's new commercial vehicle emission standards[26] - The commercial vehicle parts revenue surged by 91.5% to HKD 386.7 million, reflecting strong demand for components meeting higher emission standards[26] - The industrial and other components segment saw revenue growth of 27.9% to HKD 786.2 million, with notable increases in leisure and recreational vehicles[27] - Revenue growth in the first half of 2021 was significant across regions: Europe (41.7%), Asia (34.9%), and the Americas (25.9%)[31] - Revenue from external customers in the Americas reached HKD 659,239,000, a 24.8% increase compared to HKD 528,584,000 in 2020[116] - Revenue from external customers in Europe was HKD 606,564,000, up 42.0% from HKD 428,013,000 in the previous year[116] - Revenue from external customers in Asia, specifically from China, was HKD 456,123,000, an increase of 32.5% from HKD 344,373,000 in 2020[116] Operational Costs and Expenses - The group faced increased costs due to rising raw material prices and shipping costs, which impacted profitability during the period[25] - Selling and distribution expenses increased by 54.3% to HKD 90.6 million, representing 5.0% of revenue compared to 4.3% in the previous year[42] - Administrative and other operating expenses rose by 19.4% to HKD 142.4 million, driven by increased employee costs and depreciation expenses[43] - Income tax expenses increased to HKD 56.5 million, primarily due to higher taxable income from the Turkish factory and an increase in the corporate tax rate[45] Capital Expenditures and Investments - Capital expenditure budget for 2021 has been increased by approximately HKD 300 million to about HKD 1,180 million to accelerate production capacity expansion[34] - Capital expenditures for the six months amounted to HKD 551.2 million, primarily for capacity expansion in China and infrastructure in Mexico[61] - The company invested HKD 538,666,000 in property, plant, and equipment, significantly higher than HKD 152,774,000 in the previous year[103] Shareholder Returns and Dividends - The board declared an interim dividend of HKD 0.029 per share, an increase of 20.8% compared to the previous year[24] - The interim dividend declared for the six months ended June 30, 2021, is HKD 0.029 per share, totaling approximately HKD 54.6 million, an increase from HKD 45.2 million for the same period in 2020[69] - The interim dividend declared was HKD 54,616,000, an increase of 21% from HKD 45,199,000 in the previous year[140] Market Strategy and Future Outlook - The company is focusing on expanding its market presence and enhancing product development strategies[19] - Future outlook includes continued investment in new technologies and potential acquisitions to drive growth[19] - The company plans to complete the construction of several factories in Mexico, with the precision machining factory already operational since June 2021[32] - The company aims to enhance its R&D capabilities to provide more diversified customized products and services, leveraging its global production bases[35] - The company plans to continue expanding its market presence and investing in new technologies to enhance its product offerings[110] Governance and Management - The company has adopted the corporate governance code as a benchmark since its listing date, and the board believes it has complied with all code provisions during the reporting period[71] - The chairman and CEO roles are held by the same individual, Mr. Lu, which the board believes is beneficial for management, despite a deviation from the corporate governance code[71] - The company’s board consists of five executive directors and three independent non-executive directors, ensuring strong independence in its composition[71] - The company has established various committees under the board, including an audit committee and a remuneration committee, to ensure compliance with governance standards[71] Employee and Stock Options - The total employee cost for the six months ended June 30, 2021, was HKD 547.1 million, compared to HKD 379.3 million for the same period in 2020, reflecting a significant increase[66] - The company has granted stock options under the pre-IPO stock option plan, with a total of 26,112,500 shares available for subscription, representing approximately 1.4% of the issued share capital as of the report date[84] - The company has not granted, exercised, lapsed, or cancelled any stock options under the post-IPO stock option plan during the six months ending June 30, 2021[84] - The pre-IPO stock option plan aims to incentivize employees by allowing them to benefit from the company's success[82] Assets and Liabilities - Total assets increased by 7.5% to HKD 6,099.2 million, primarily due to continued investment in the construction of the Mexico factory[53] - The company's total liabilities increased to HKD 1,172,581,000 from HKD 1,007,368,000, reflecting a rise of approximately 16.4%[97] - The net asset value of the company stood at HKD 4,202,563,000 as of June 30, 2021, compared to HKD 4,032,897,000 at the end of 2020, showing an increase of about 4.2%[99] - The company’s equity attributable to shareholders increased to HKD 4,181,053,000 from HKD 4,013,137,000, representing a growth of approximately 4.2%[99]

Financial Performance - The total revenue for the year 2020 was HKD 2,924.6 million, with a compound annual growth rate (CAGR) of 3.5% from 2016 to 2020[16]. - The company's revenue for the year ended December 31, 2020, was HKD 2,924.6 million, a decrease of 19.7% compared to HKD 3,640.2 million in 2019[37]. - The adjusted profit attributable to shareholders was HKD 313.4 million, down 45.6% from HKD 575.7 million in the previous year[37]. - The company reported a loss attributable to shareholders of HKD 148.2 million, primarily due to impairment losses on goodwill and other assets amounting to HKD 444.2 million[37]. - Free cash flow for the year was HKD 364.0 million, equivalent to 114.7% of the adjusted profit[37]. - The EBITDA for the year was HKD 356.7 million, a decline of 67.1% from HKD 1,082.8 million in 2019[34]. - The group's gross profit margin decreased to 26.2% from 31.1% in the previous year, a decline of 4.9%[54]. - The group reported a net loss attributable to shareholders of HKD 144.3 million, a decrease of 126.8% compared to a profit of HKD 539.0 million in 2019[52]. - The operating loss for the year was HKD 32.0 million, a decline of 104.6% from an operating profit of HKD 696.5 million in 2019[54]. Revenue Breakdown - The investment casting segment accounted for 44.7% of the group's revenue for the year ended December 31, 2020[21]. - Precision machining contributed 31.7% to the group's revenue for the year ended December 31, 2020[21]. - Sand casting represented 14.9% of the group's revenue for the year ended December 31, 2020[23]. - Surface treatment services accounted for 8.7% of the group's revenue for the year ended December 31, 2020[23]. - Revenue from the investment casting segment was HKD 1,307.0 million, down 22.3% year-on-year due to the impact of the pandemic on the aerospace market[39]. - Revenue from precision machining decreased by 17.2% to HKD 926.6 million, with significant recovery in the second half of the year[39]. - Revenue from the automotive sector decreased by 14.9% to HKD 1,394.2 million, with passenger vehicles down 21.1% and commercial vehicles down 2.1%[43]. - Revenue from the aerospace and medical sectors dropped significantly by 39.4% to HKD 272.1 million, with aerospace sales down 47.6%[43]. - Revenue from the Americas fell by 27.1% to HKD 1,160.5 million, while European revenue decreased by 22.2% to HKD 932.1 million[45]. - Revenue from the Chinese market increased by 1.5% to HKD 780.8 million, contrasting with declines in other regions[44]. Operational Highlights - The company operates 19 production facilities globally, with 14 currently operational and 5 under construction[20]. - The workforce includes over 6,100 employees, among which over 600 are engineers from around the world[18]. - The company serves over 1,000 customers from more than 30 countries and regions[18]. - The group operates four factories in China, one in Germany, and one in the Czech Republic for investment casting production[21]. - The group manufactures precision machining components in two factories in Turkey, one in China, and one in Mexico[21]. - The majority of surface treatment customers are from the Chinese passenger vehicle market, with a smaller portion from the Chinese aviation market[23]. - The group has an order backlog of HKD 2,623 million as of February 28, 2021, providing strong support for future business growth[50]. Strategic Initiatives - The company plans to develop new energy vehicle components in Turkey and Mexico, with production expected to start next year[46]. - The company is exploring new projects related to new energy vehicles to capitalize on market trends[46]. - The group plans to complete the first phase of its Mexico production facility, which is expected to generate over USD 150 million in annual revenue at full capacity[54]. - The group is implementing a "dual-source production" strategy to mitigate potential supply chain and tariff risks associated with geopolitical factors[50]. - The group continues to pursue a strategy of "global layout" and "local manufacturing" to strengthen its competitiveness in the North American market[50]. Corporate Governance - The company emphasizes high corporate governance standards to enhance shareholder value and ensure transparency and accountability[104]. - The company’s board consists of five executive directors and three independent non-executive directors, ensuring a strong level of independence[104]. - The audit committee is responsible for reviewing the company's financial controls, internal controls, and risk management systems[118]. - The board emphasizes the importance of corporate governance and seeks to enhance efficiency and profitability[106]. - The company has established a formal and transparent nomination policy for selecting and appointing new directors[112]. - The company has established a sustainable development committee to promote sustainability among internal and external stakeholders[125]. Shareholder Engagement - The company actively engages with shareholders and potential investors through various communication channels, including analyst briefings and investor meetings[98]. - The company maintained a dividend payout ratio of 25.0% over the past five years, reflecting its commitment to sustainable shareholder value creation[95]. - The company has a dividend policy to distribute no less than 25% of the distributable profits attributable to equity shareholders annually, subject to various factors[167]. - The company allows shareholders holding at least 10% of voting shares to request a special general meeting within two months of the request[144]. - The company has established a fair and transparent process for shareholders to exercise their rights and communicate effectively with the company[143]. Employee and Management Information - The total employee cost for the year ended December 31, 2020, was HKD 790.4 million, a decrease from HKD 965.0 million in 2019[88]. - The total remuneration for executive directors and senior management for the year ended December 31, 2020, amounted to HKD 13,865,000[128]. - The five highest-paid individuals in the group received total compensation of HKD 14,326,000 for the year ended December 31, 2020[131]. - The company has independent non-executive directors with extensive experience in finance, accounting, and investment management, enhancing corporate governance[154]. - The company’s board members participated in appropriate continuous professional development activities, ensuring compliance with the requirement of at least 15 hours of training[134]. Market and Industry Trends - Demand for high-emission standard parts for commercial vehicles is anticipated to rise due to stricter emission policies globally[46]. - The industrial sector faced challenges due to pandemic-related restrictions, but there was a rebound in hydraulic equipment sales in China during the second half of the year[46]. - Overall, the company experienced a decline in all end markets due to the adverse effects of the COVID-19 pandemic[42]. Financial Management - The group has adopted a prudent financial management approach to allocate sufficient financial resources to its subsidiaries at the lowest financial cost[87]. - The total working capital decreased to 914.2 million HKD as of December 31, 2020, from 1,010.1 million HKD in the previous year[67]. - The effective tax rate increased due to a 13.5 million HKD tax burden from foreign exchange gains and an 11.7 million HKD withholding tax provision for undistributed profits[66]. - The company has not encountered any significant difficulties or liquidity issues due to foreign exchange fluctuations as of December 31, 2020[87].

Financial Performance - Revenue for the six months ended June 30, 2020, was HKD 1,368.6 million, a decrease of 28.4% compared to HKD 1,911.1 million in 2019[8]. - Gross profit decreased by 40.3% to HKD 365.9 million, with a gross margin of 26.7%, down from 32.0% in the previous year[8]. - The company reported a loss attributable to shareholders of HKD 269.8 million, a decline of 189.9% from a profit of HKD 300.2 million in 2019[8]. - Adjusted EBITDA for the period was HKD 409.8 million, down 32.5% from HKD 607.5 million in the same period last year[11]. - Adjusted profit attributable to shareholders was HKD 182.9 million, down 44.3% from HKD 328.2 million in the same period last year[14]. - Basic adjusted earnings per share were HKD 0.097, a decline of 55.5% compared to the previous year[14]. - Operating loss for the period was HKD 226.6 million, compared to an operating profit of HKD 394.3 million in the same period last year, reflecting a significant decline in operating profit margin[31]. - The company reported a net loss of HKD 268,251 for the period, compared to a profit of HKD 300,445 in the previous year[102]. - Total comprehensive income for the period was HKD (373,536,000), a decrease from HKD 286,287,000 in the previous year[104]. Debt and Equity - Total debt decreased by 16.1% to HKD 908.0 million from HKD 1,082.3 million[8]. - Net debt reduced by 32.2% to HKD 344.7 million compared to HKD 508.5 million at the end of 2019[8]. - The company’s total equity decreased by 10.7% to HKD 3,597.4 million from HKD 4,027.0 million[8]. - Market capitalization as of June 30, 2020, was HKD 5,028.4 million, down 16.6% from HKD 6,026.5 million[8]. - The net debt-to-equity ratio as of June 30, 2020, was 9.6%, down from 12.6% as of December 31, 2019, mainly due to the repayment of existing borrowings[59]. - The company’s total liabilities decreased to HKD 539,562,000 from HKD 635,661,000, reflecting a reduction of approximately 15.1%[107]. Cash Flow and Investments - Cash flow from operating activities for the six months ended June 30, 2020, was HKD 452.4 million, a decrease of HKD 28.6 million from HKD 481.0 million in the previous year[53]. - Capital expenditures for the six months ended June 30, 2020, amounted to HKD 172.1 million, primarily for capacity expansion in the China factory and infrastructure spending in Mexico[60]. - Cash used in investing activities was HKD 167.7 million, significantly lower than HKD 300.9 million in the previous year, with major expenditures on capital payments for machinery and equipment[53]. - The company incurred a net cash outflow from investing activities of HKD 167,681,000, compared to HKD 300,874,000 in the previous year, indicating a reduction in investment spending[116]. Market and Segment Performance - Revenue from the investment casting segment was HKD 661.1 million, down 23.4% year-on-year, while precision machining revenue fell 37.5% to HKD 390.4 million[16]. - The automotive market saw a significant revenue decline of 31.5%, with total automotive revenue at HKD 596.7 million compared to HKD 870.7 million in the previous year[20]. - Revenue from the Americas decreased by 31.7% to HKD 570.2 million, with the U.S. market contributing HKD 528.6 million, down 32.1%[22]. - The European market revenue dropped by 34.0% to HKD 428.0 million, while Asian revenue decreased by 13.3% to HKD 370.4 million[22]. - The only segment to show slight growth was the medical end market, while all other segments faced declines due to the pandemic[18]. Operational Adjustments and Strategies - The company experienced a significant impact on production capacity due to the COVID-19 pandemic, particularly affecting operations in Europe and North America[15]. - The group is implementing a "Local For Local" strategy with new production facilities in Mexico to enhance supply capabilities and reduce geopolitical risks[24][28]. - The company has adopted a prudent financial management approach to allocate sufficient financial resources to its subsidiaries at the lowest financial cost[66]. - The company has implemented cost control measures to reduce operating expenses, with administrative and other operating expenses down by 21.4% to HKD 119.3 million[39]. Governance and Shareholder Information - The company has adopted the Corporate Governance Code and believes it has complied with all provisions, except for the separation of roles between the Chairman and CEO, which is held by Mr. Lu[74]. - Major shareholders include Impro Development with 1,137,790,787 shares (60.41%) and Baring Private Equity Asia V Holding Limited with 237,153,654 shares (12.59%)[81]. - The company’s board consists of five executive directors and three independent non-executive directors, ensuring strong independence in its composition[74]. - The company has established various committees under the board, including an Audit Committee and a Nomination Committee, to ensure compliance with governance standards[75]. Employee and Operational Metrics - The total employee cost for the six months ended June 30, 2020, was HKD 379.3 million, a decrease from HKD 473.5 million for the same period in 2019[67]. - As of June 30, 2020, the group had 6,553 full-time employees, with 5,505 based in mainland China and 1,048 in other countries[67]. - The company has not identified any acquisition targets as of the mid-report date but will continue to seek opportunities in the second half of 2020[70].

Financial Performance - The company reported a revenue of HKD 3,640.2 million for the year 2019, reflecting a compound annual growth rate (CAGR) of 12.6% from 2016 to 2019[14]. - The company's revenue for the year ended December 31 was HKD 3,640.2 million, a decrease of 2.9% compared to HKD 3,749.1 million in the previous year[26]. - Adjusted net profit attributable to shareholders was HKD 538.8 million, up 31.5% from HKD 409.6 million in the previous year[26]. - Basic earnings per share increased by 16.5% to HKD 31.8 cents from HKD 27.3 cents[26]. - EBITDA for the year was HKD 1,082.8 million, representing a 13.7% increase from HKD 952.6 million in the previous year[24]. - Gross profit fell by 6.3% to HKD 1,131.5 million, with a gross margin of 31.1%, down from 32.2% in the previous year[42]. - The company reported a net profit of HKD 539.0 million, representing a 31.0% increase compared to HKD 411.5 million in 2018[38]. - Operating profit increased by 21.3% to HKD 696.5 million, with an operating margin of 19.1%, up from 15.3% in the previous year[38]. - Total revenue for the year was HKD 3,640.2 million, representing a decrease of 2.9% compared to the previous year[32]. - The company experienced a significant reduction in financing costs, which decreased by 33.3% to HKD 58.0 million[38]. Market and Operational Insights - The company is the seventh largest independent investment casting manufacturer globally and the largest in China, with precision machining accounting for 30.7% of its revenue[14]. - The company has over 7,100 employees, including more than 600 engineers from around the world, and serves approximately 1,600 customers across over 30 countries[16]. - The company operates 15 production facilities globally, with sales offices and warehousing capabilities in China, the Americas, Luxembourg, Germany, Turkey, and Hong Kong[18]. - The company aims to provide a one-stop solution, including R&D, mold design and manufacturing, casting, secondary machining, heat treatment, and surface treatment[14]. - The company has established long-term strategic partnerships with several globally recognized industry leaders[13]. - The company is focused on innovation and efficiency, aiming to minimize non-value-added activities and enhance operational effectiveness[10]. Revenue Breakdown - Revenue from the automotive end market decreased by 6.2% year-on-year to HKD 1,637.5 million, accounting for 45.0% of total revenue[31]. - Revenue from the industrial end market declined by 5.2% year-on-year to HKD 1,553.9 million, primarily due to protectionism in global trade[31]. - Revenue from the aerospace and medical end markets grew by 23.0% year-on-year to HKD 448.8 million, driven by strong demand in these sectors[31]. - Revenue from precision machining parts decreased by 7.9% to HKD 1,118.7 million, primarily due to weak demand in the commercial vehicle and hydraulic equipment markets[28]. - Surface treatment revenue fell by 21.7% to HKD 274.8 million, impacted by declining demand in the passenger vehicle market in mainland China[28]. Strategic Initiatives - The company is investing in a new production facility in San Luis Potosí, Mexico, with a total land area of 227,474 square meters, aimed at mitigating supply chain risks[33]. - The company plans to implement a "dual-engine growth" strategy focusing on organic growth and strategic acquisitions to enhance its market position[36]. - The company aims to balance its market coverage across automotive, industrial, aerospace, and medical sectors to improve profitability and growth potential[35]. - The company continues to focus on high-precision and high-complexity products while implementing a "Local For Local" strategy to enhance operational efficiency[33]. Corporate Governance and Management - The company has committed to maintaining high corporate governance standards to enhance shareholder value and transparency[82]. - The board consists of five executive directors and three independent non-executive directors as of December 31, 2019[84]. - The audit committee held two meetings during the year, with all members present at each meeting[93]. - The remuneration committee held one meeting during the year, with all members present[96]. - The company has a formal and transparent nomination policy for selecting and appointing new directors[88]. - The company emphasizes fair and transparent procedures for all shareholders to exercise their rights and engage in effective communication[115]. Shareholder Information - The company maintained a dividend payout ratio of 25% for the fiscal year 2019, with dividends increasing approximately 60% since 2016[74]. - The interim dividend for the fiscal year 2019 was set at HKD 0.04 per share, while the final dividend was HKD 0.032 per share[78]. - As of December 31, 2019, the company's distributable reserves for dividends amounted to HKD 1,636.5 million[139]. - The company has a public float exceeding 25% of its issued shares as of the report date[174]. Audit and Compliance - The independent auditor for the group is KPMG, with total fees paid/owed amounting to HKD 7.4 million for the year ended December 31, 2019, down from HKD 11.1 million in 2018[110]. - The audit committee has confirmed that the group has maintained an appropriate, effective, and adequate internal control and enterprise risk management system throughout the period from listing to December 31, 2019[114]. - The audit identified the trade receivables loss provision as a key audit matter due to the significant management judgment involved in determining the provision[184]. - The audit identified the assessment of goodwill impairment as a key audit matter due to the inherent complexity and management's subjective judgment involved[188]. Employee and Compensation - The total employee costs for the year reached HKD 965.0 million, up from HKD 948.0 million in 2018, reflecting a year-on-year increase of approximately 1.3%[69]. - The total remuneration for executive directors as of December 31, 2019, amounted to HKD 14,049,000, with performance bonuses contributing HKD 2,323,000[100]. - The five highest-paid individuals in the group received a total remuneration of HKD 15,370,000, including performance bonuses of HKD 2,651,000[103]. - The remuneration for independent non-executive directors was set at HKD 225,000 each, effective from April 1, 2019[101]. Future Outlook - The impact of the COVID-19 pandemic on the company's operations and supply chain remains uncertain, with potential fluctuations in demand across different end markets[36]. - The company is well-positioned for future growth with a diverse and experienced management team, ready to tackle market challenges and opportunities[126][128].

Financial Performance - Revenue increased to HKD 1,911.1 million, a 2.3% increase compared to the same period last year; in local currency, it increased by 6.1%[3] - Gross profit rose to HKD 612.4 million, with a gross margin of 32.0% (up from 31.7% in the same period last year)[3] - EBITDA increased to HKD 588.8 million, with an EBITDA margin of 30.8% (up from 29.6% last year)[3] - Operating profit rose to HKD 394.3 million, with an operating margin of 20.6% (up from 19.7% last year)[3] - Net profit attributable to shareholders increased to HKD 300.2 million, an 11.1% increase compared to HKD 270.1 million in the same period last year[4] - Adjusted net profit attributable to shareholders rose to HKD 328.2 million, a 4.7% increase year-on-year[3] - Earnings per share (basic and diluted) were HKD 0.199, a 10.6% increase compared to the same period last year[3] - The group's revenue for the six months ended June 30, 2019, increased by 2.3% to HKD 1,911.1 million, compared to HKD 1,867.8 million in the same period of 2018[12] - Adjusted net profit attributable to shareholders increased by 11.1% to HKD 300.2 million, compared to HKD 270.1 million in the same period of 2018[17] - The net profit attributable to equity holders for the six months ended June 30, 2019, was HKD 300.2 million, up 11.1% from HKD 270.1 million in the same period of 2018, resulting in a net profit margin increase from 14.5% to 15.7%[35] Revenue Segmentation - The investment in the precision machining segment generated revenue of HKD 624.3 million, a 1.2% increase year-on-year[5] - Revenue from the aerospace and medical end markets increased by 33.2%, accounting for 11.3% of total revenue[8] - Revenue from the Americas rose significantly, with sales reaching HKD 835.0 million, accounting for 43.7% of total revenue, up from 39.7% in 2018[12] - Revenue for the six months ended June 30, 2019, was HKD 1,911,085 thousand, an increase of 2.6% compared to HKD 1,867,804 thousand in 2018[57] - Revenue from external customers for the first half of 2019 was HKD 1,911,085,000, a 2.6% increase from HKD 1,867,804,000 in the same period of 2018[102] Cost and Expenses - Selling and distribution expenses increased by 21.2% to HKD 82.0 million, primarily due to additional U.S. tariffs amounting to HKD 10.7 million[24] - Administrative and other operating expenses decreased by 13.0% to HKD 151.9 million, excluding listing expenses[25] - Net financing costs rose to HKD 45.3 million from HKD 43.5 million, attributed to higher LIBOR and HIBOR rates[26] - The total employee cost for the six months ended June 30, 2019, was HKD 473.5 million, compared to HKD 464.3 million for the same period in 2018, reflecting an increase of approximately 2.6%[50] Cash Flow and Liquidity - Cash and cash equivalents increased significantly by 451.1% to HKD 1,309.9 million as of June 30, 2019, compared to HKD 237.7 million at the end of 2018[17] - Cash flow from operating activities was HKD 481.0 million, an increase of 14.4% from HKD 420.5 million in the previous year[38] - Cash used in investing activities was HKD 300.9 million, up from HKD 286.5 million in the same period last year, mainly for capital expenditures[38] - Cash flow from financing activities was HKD 892.1 million, a significant increase from a cash outflow of HKD 141.7 million in the previous year, primarily due to net proceeds from the global offering[40] Assets and Liabilities - Total assets increased by 21.6% to HKD 6,770.1 million as of June 30, 2019, while total equity rose by 41.4% to HKD 3,796.3 million compared to December 31, 2018[36] - The current ratio improved to 1.49 as of June 30, 2019, from 1.06 as of December 31, 2018, primarily due to increased bank balances from global offering proceeds[36] - Total inventory increased by HKD 65.9 million to HKD 804.3 million, mainly due to restored inventory levels in the U.S. and increased production to meet strong customer demand[29] - Trade receivables decreased by HKD 48.7 million to HKD 870.8 million, reflecting the company's efforts to collect outstanding trade debts[31] Dividend and Shareholder Information - The interim dividend declared is HKD 0.04 per share, reflecting the company's profitability and need for financial resources for business expansion[16] - The company declared an interim dividend of HKD 0.04 per share for the six months ended June 30, 2019, totaling approximately HKD 75.3 million, compared to zero for the same period in 2018[145] - Major shareholder Impro Development holds 1,137,790,787 shares, representing 62.06% of the company's issued share capital[154] - Baring Private Equity Asia V Holding owns 237,153,654 shares, accounting for 12.94% of the total issued shares[154] Corporate Governance and Compliance - The company has adopted the Corporate Governance Code and has complied with all provisions during the reporting period, except for the separation of the roles of Chairman and CEO[147] - The company has established an audit committee, nomination committee, and remuneration committee to ensure compliance with corporate governance standards[148] - The audit committee has reviewed the unaudited interim results for the six months ending June 30, 2019, in accordance with international auditing standards[166] IFRS 16 Adoption - The company has adopted the new International Financial Reporting Standard 16 (IFRS 16) for leases, which requires capitalization of all leases except for short-term leases and low-value assets[75] - The initial application of IFRS 16 resulted in adjustments to the equity balance as of January 1, 2019, but comparative figures have not been restated[76] - The group recognized lease liabilities totaling HKD 158,836,000 as of January 1, 2019, following the adoption of IFRS 16, with a present value of remaining lease payments discounted using a weighted average incremental borrowing rate of 4.60%[79] Share Options and Employee Incentives - The company granted 30,230,000 share options to directors and employees at an exercise price of HKD 2.40, which is a 20% discount to the IPO price[132] - The stock options are designed to incentivize employees and align their interests with the company's performance[159] - The maximum number of shares that can be issued upon the exercise of options granted under the post-IPO share option plan is capped at 10% of the issued shares as of the listing date, totaling 183,330,000 shares[163]