Summary of Conference Call Company and Industry Overview - The conference call discusses the performance and outlook of a company involved in the manufacturing of engines, particularly focusing on the mid-range market related to AI and aviation sectors. The company reported a revenue increase of 1.8% in 2020, reaching HKD 4.687 billion, with significant growth in specific segments like AI data centers and aviation markets [3][4]. Key Points and Arguments 1. **Revenue Growth and Market Segmentation**: - The mid-range market related to AI saw a substantial increase of 58.6% in 2020, while the aviation terminal market grew by 26.8%. However, growth in the second half of the year slowed due to issues with Boeing [3]. - Other markets, including entertainment, agriculture, and various industrial sectors, experienced declines [3][6]. 2. **Profitability Metrics**: - The company's gross margin improved by 1.5 percentage points to 27.1% in 2024, primarily due to the performance of the AI-related mid-range market [8]. - Adjusted earnings per share increased by 10.1% to HKD 6.41, with a 15.7% rise in net profit to HKD 1.616 billion [4][9]. 3. **Future Growth Opportunities**: - The company anticipates strong growth in the medical and aviation sectors in 2025, despite a decline in 2024 [4]. - The company is also investing in expanding its manufacturing capabilities in Mexico, with new facilities expected to come online in the near future [5][12]. 4. **Challenges and Risks**: - The company faces challenges from high interest rates affecting agricultural equipment purchases and a decline in consumer interest in luxury goods in the U.S. and Europe [6]. - The aviation sector's growth is tempered by uncertainties surrounding Boeing and Airbus, which could impact future demand [7][36]. 5. **Operational Efficiency**: - The company has managed to reduce its net debt while maintaining capital expenditures and shareholder returns [5]. - Operational efficiency is being improved through investments in new facilities and technology, particularly in Mexico [12][15]. 6. **Market Dynamics**: - The company noted a significant decline in the chip and entertainment sectors, with a 31.8% drop in the mid-range market for these products [6]. - The agricultural sector is also under pressure, with farmers reducing new equipment purchases due to high interest rates [6]. 7. **Financial Health**: - The company reported a stable financial position with a cash dividend payout ratio of 49% and a commitment to maintaining shareholder returns [5][9]. - The adjusted return on equity (ROE) reached 12.8%, with management aiming to exceed 15% in the future [13]. 8. **Geopolitical and Economic Factors**: - Ongoing geopolitical tensions and high inflation rates are expected to impact global economic conditions, affecting short-term revenue growth [17]. - The demand for AI-related products is anticipated to continue driving growth in the mid-range engine market [17]. Additional Important Information - The company is actively working on expanding its workforce and facilities in Mexico to meet increasing demand, with plans to accommodate over 500 employees in new living quarters [12]. - The company has received recognition for its ESG efforts, indicating a commitment to sustainable practices [14]. - The impact of tariffs and trade agreements, particularly with the U.S., remains a critical factor in the company's operational strategy [18][39]. This summary encapsulates the key insights from the conference call, highlighting the company's performance, market dynamics, and future outlook while addressing potential risks and operational strategies.

EF001 免責聲明 | 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 公告全部或任何部份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。 | | | --- | --- | | 股票發行人現金股息公告 | | | 發行人名稱 | 鷹普精密工業有限公司 | | 股份代號 | 01286 | | 多櫃檯股份代號及貨幣 | 不適用 | | 相關股份代號及名稱 | 不適用 | | 公告標題 截至二零二四年十二月三十一日止年度第二次中期股息 | | | 公告日期 | 2025年3月11日 | | 公告狀態 | 新公告 | | 股息信息 | | | 股息類型 | 中期（半年期） | | 股息性質 | 普通股息 | | 財政年末 | 2024年12月31日 | | 宣派股息的報告期末 | 2024年12月31日 | | 宣派股息 | 每 股 0.08 HKD | | 股東批准日期 | 不適用 | | 香港過戶登記處相關信息 | | | 派息金額及公司預設派發貨幣 | 每 股 0.08 HKD | | 匯率 | 1 HKD : 1 ...

Financial Performance - For the fiscal year ending December 31, 2024, the company's revenue was HKD 4,686.8 million, representing a year-on-year increase of 1.8%[4] - Gross profit rose by 7.7% to HKD 1,269.1 million, with a gross profit margin of 27.1% compared to 25.6% in the previous year[4] - The profit attributable to shareholders increased to HKD 644.3 million, a year-on-year rise of 10.1%, while the adjusted profit attributable to shareholders was HKD 615.5 million, up 15.7%[4] - Basic earnings per share were HKD 0.341, compared to HKD 0.310 for the fiscal year ending December 31, 2023[6] - The company reported operating cash flow of HKD 1,146.2 million, with net debt decreasing by HKD 32.5 million, indicating strong cash flow performance[6] - Other income increased significantly by 527.5% to HKD 125.5 million, contributing positively to overall financial performance[39] - The net profit attributable to shareholders increased by 10.1% to HKD 644.3 million, with a net profit margin of 13.8%[39] - Adjusted EBITDA for the year ending December 31, 2024, was HKD 1,318.6 million, compared to HKD 1,214.9 million in the previous year[46] - The company reported a net profit attributable to shareholders of HKD 615.5 million for the year ending December 31, 2024, compared to HKD 532.0 million in the previous year[46] Revenue Breakdown - The revenue from the large-capacity engine terminal market grew significantly by 58.6%, while the aviation terminal market saw a 26.8% increase[4] - Revenue from recreational vessels and vehicles, agricultural machinery, and construction machinery terminal markets declined by 31.8%, 23.0%, and 6.7% respectively, primarily due to economic weakness in the US and Europe[11] - The aviation, energy, and medical terminal markets maintained strong growth, with revenue rising to HKD 786.3 million, up 13.0% year-on-year[15] - The automotive terminal market saw a slight decline in revenue, down 3.2% to HKD 1,640.5 million, with passenger vehicle revenue increasing by 2.0%[14] - Revenue from the Americas region grew by 4.3%, totaling HKD 2,328.5 million, while European revenue decreased by 5.4%[21] Market Challenges and Strategies - The company faced challenges in the Mexican region, recording significant net losses, although EBITDA losses decreased year-on-year[9] - The group operates 21 factories across China, Germany, Turkey, the Czech Republic, and Mexico, adhering to a "regional manufacturing" and "dual-source production" strategy to mitigate supply chain risks[27] - The company maintained a strategy of "global layout," "diversified terminal markets," and "dual-engine growth" to navigate economic challenges[23] - Despite facing downward risks in some end markets due to geopolitical conflicts and high inflation, the group maintains confidence in its business performance for 2025, forecasting a year-on-year sales growth rate of approximately mid to high single digits[31] Future Outlook - The aerospace end market continues to show strong performance, with significant revenue growth expected as Boeing aircraft production gradually recovers, leading to increased demand in the aerospace supply chain by 2025[24] - The large horsepower engine end market experienced strong revenue growth, driven by the increasing application of artificial intelligence in data centers, with expectations of continued significant growth over the next two to three years, potentially surpassing the passenger vehicle end market by 2025[25] - The group expects significant growth in the medical terminal market by 2025, driven by new products developed for North American customers, which began to ramp up in Q4 2024[33] - The group anticipates that artificial intelligence will continue to accelerate over the next two to three years, driving demand for data centers and benefiting large horsepower engine orders, with expectations of significant product development in 2024[32] Capital Expenditures and Investments - Capital expenditures for 2025 are projected to be approximately HKD 650 million, with about two-thirds allocated to the SLP park in Mexico[36] - The group has initiated the construction of a second-phase factory in the SLP park to meet the growing demand for high-power engine components, expected to be completed by the end of 2025[36] - The company plans to continue focusing on market expansion and new product development to drive future growth[46] Corporate Governance and Compliance - The company believes that good corporate governance enhances overall efficiency and creates more value for shareholders[139] - The company has adhered to all corporate governance code provisions as of December 31, 2024, with a significant degree of compliance with best practices[140] - The chairman and CEO roles are held by the same individual, which the board believes benefits the management of the company[141] - The Audit Committee has reviewed the consolidated financial statements for the year ending December 31, 2024, confirming compliance with applicable accounting standards and regulations[150] Environmental and Social Responsibility - The company achieved a greenhouse gas emission reduction of 0.2% year-on-year for 2024, excluding new factories in Nantong and Zhenjiang[85] - Cumulative reductions in greenhouse gas emissions and water consumption density have reached 40.0% and 55.9%, respectively, compared to the baseline year of 2020[85] - The waste recycling rate improved from 76.9% in 2023 to 87.8% in 2024, demonstrating significant progress in waste management[85] - The company received the Standard Chartered Corporate Achievement Award for "Sustainable Enterprise (Environment) Excellence" for 2024, highlighting its commitment to corporate social responsibility[86]

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，概不就因本公告全部 或任何部分內容所產生或因依賴該等內容而引致的任何損失承擔任何責任。 IMPRO PRECISION INDUSTRIES LIMITED 鷹 普 精 密 工 業 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1286） 董事會會議通告 本公告乃根據香港聯合交易所有限公司證券上市規則第13.43條作出。 鷹普精密工業有限公司（「本公司」）董事會（「董事會」）謹此宣佈，本公司將於二零 二五年三月十一日（ 星期二 ）舉行董事會會議，藉以： 承董事會命 鷹普精密工業有限公司 公司秘書 香港，二零二五年二月二十五日 於本公告日期，董事會包括四名執行董事，即陸瑞博先生、余躍鵬先生、朱力微 女士及王東先生，以及三名獨立非執行董事，即嚴震銘博士、李小明先生及周駱 美琪女士。 1. 考慮及批准本公司及其附屬公司截至二零二四年十二月三十一日止年度的全 年業績及其發佈； 2. 考慮宣布派發二零二四年第二次中期股 ...

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，概不就因本公告全部 或任何部分內容所產生或因依賴該等內容而引致的任何損失承擔任何責任。 IMPRO PRECISION INDUSTRIES LIMITED 鷹 普 精 密 工 業 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1286） (1)獨立非執行董事變更； 及 (2)董事委員會組成變更 鷹 普 精 密 工 業 有 限 公 司（「 本 公 司 」， 連 同 其 附 屬 公 司 統 稱「 本 集 團 」）董 事（「 董 事 」）會（「 董 事 會 」）宣 佈 以 下 董 事 會 變 動 ， 自 二 零 二 四 年 十 二 月 三 十 一 日 起 生 效： 獨立非執行董事辭任 董事會宣佈，余先生因有意投放更多時間於其他業務及個人事務而已辭任獨立非 執行董事、審核委員會主席及薪酬委員會成員，自二零二四年十二月三十一日起 生效。 余先生已確認，就其辭任而言，彼與董事會並無任何意見分歧，亦無其他事宜需 提請本公 ...

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 2.9 per share [5] Core Views - The company reported H1 2024 revenue of HKD 2,402.5 million, a slight decrease of 0.1% YoY, while net profit attributable to shareholders increased by 0.4% YoY to HKD 304.5 million [2] - Gross margin improved by 0.4 percentage points to 26.4% in H1 2024 [2] - The aerospace sector showed strong growth, with revenue increasing by 35.3% YoY, driven by global market recovery and new product launches [2] - Traditional industrial sectors faced pressure, with engineering machinery revenue down 16.9%, agricultural machinery down 14.0%, and leisure marine & vehicle revenue down 25.9% [2] - The company's new factories in Mexico are fully operational, with 3 expected to break even by end-2024 and 2 aerospace and surface treatment facilities to start mass production in H2 2025 [2] - The company's global diversification strategy is paying off, with aerospace and medical equipment sectors expected to become new growth drivers [2] Financial Performance - Revenue is projected to grow at a CAGR of 8.7% from 2024E to 2026E, reaching HKD 5,980 million by 2026E [4] - Net profit attributable to shareholders is expected to grow from HKD 613 million in 2024E to HKD 786 million in 2026E, representing a CAGR of 13.2% [4] - EPS is forecasted to increase from HKD 0.32 in 2024E to HKD 0.42 in 2026E [4] - ROE is expected to remain stable at around 11.2%-11.5% from 2024E to 2026E [4] Strategic Developments - The company's global diversification strategy is mitigating market cyclical risks, with aerospace and medical equipment sectors poised to become new growth engines [2] - The company is accelerating capacity expansion in Mexico to address tariff risks, with 5 new factories already completed in H1 2024 [2] - The US market accounted for 45.4% of total revenue in H1 2024, with Mexico contributing 10% of total capacity in 2023 [2]

Financial Performance - Revenue for the six months ended June 30, 2024, was HKD 2,402.5 million, a slight decrease of 0.1% compared to HKD 2,404.8 million in the same period of 2023[8]. - Gross profit increased by 1.7% to HKD 634.5 million, with a gross margin of 26.4%, up from 26.0%[8]. - Adjusted profit attributable to shareholders was HKD 304.5 million, reflecting a 0.4% increase from HKD 303.2 million in the previous year[8]. - Basic earnings per share rose to HKD 16.13, a 0.2% increase from HKD 16.09[8]. - Adjusted EBITDA for the period was HKD 694.3 million, representing a 3.5% increase from HKD 671.0 million[8]. - Operating profit for the first half of 2024 was HKD 432.2 million, reflecting a 1.8% increase from HKD 424.6 million in the previous year[28]. - The net profit for the period was HKD 305,458, a marginal increase from HKD 303,491 in the previous year, indicating a growth of 0.6%[81]. - The company reported a significant increase in other income, which rose by 74.3% to HKD 44.8 million[28]. Revenue Segmentation - The company reported a significant increase in revenue from the large horsepower engine market, rising by 42.9% due to increased demand in the U.S. and European markets[15]. - The aviation segment's revenue grew by 35.3%, driven by the recovery of the global aviation market and increased market share[16]. - The energy segment's revenue increased by 27.3%, benefiting from continuous market share growth[16]. - Revenue for the diversified industrial segment decreased by 3.9% to HKD 1,138.2 million, while the automotive segment revenue fell by 3.8% to HKD 866.3 million compared to the same period last year[17]. - Revenue from the aerospace, energy, and medical segments increased by 24.5% to HKD 398.0 million, with aerospace alone growing by 35.3% to HKD 255.5 million[20]. - Revenue from the United States was HKD 1,090,100, showing an increase from HKD 1,023,291 in the previous year, while European revenue decreased to HKD 739,919 from HKD 790,159[111]. Cash Flow and Financing - Free cash flow from operations decreased significantly by 43.0% to HKD 156.6 million compared to HKD 274.9 million in the prior year[8]. - Operating cash flow for the period was HKD 497.9 million, a decrease of 26.5% from HKD 677.5 million in the same period last year[45]. - Cash used in financing activities was HKD 333.6 million, an increase of 125.5% from HKD 148.0 million in the same period last year[47]. - The net financing cost for the six months ended June 30, 2024, was HKD 55,049,000, an increase of 9.3% from HKD 50,401,000 in 2023[116]. Dividends and Shareholder Information - The company declared an interim dividend of HKD 0.08 per share, consistent with the previous year[8]. - The interim dividend declared for the six months ending June 30, 2024, is HKD 0.08 per share, totaling approximately HKD 151.0 million, compared to HKD 150.8 million for the same period last year[56]. - The record date for the interim dividend is August 27, 2024, with payment expected on or before September 6, 2024[57]. - Major shareholders include Impro Development with 1,348,118,787 shares (71.43%) and Mr. Lu with 1,357,357,787 shares (71.92%) as of June 30, 2024[66]. Market Outlook and Strategic Initiatives - The company is focused on expanding its market presence and enhancing product development strategies moving forward[8]. - The company adjusted its full-year sales growth forecast for 2024 to between 3% and 8% due to global economic challenges and geopolitical tensions[26]. - The company expects strong demand for high-power engines driven by the rapid development of AI and big data centers in the US and Europe[26]. - The integration of the Nantong No. 12 factory with Foshan Meiduan is set to enhance production capacity and efficiency in the aerospace and energy components business by the end of 2024[26]. - The company plans to start the second phase of construction in the Mexico SLP area in the second half of 2024 to enhance production capabilities[26]. Compliance and Governance - The company has adopted the corporate governance code and has complied with all relevant provisions, except for the separation of the chairman and CEO roles[58]. - All directors confirmed compliance with the standard code of conduct for securities trading during the six months ending June 30, 2024[60]. - The board consists of four executive directors and three independent non-executive directors, ensuring strong independence[58]. Asset and Liability Management - The total debt decreased to HKD 2,124.8 million from HKD 2,257.8 million, reflecting a reduction of 5.9%[10]. - The net asset value of the company was HKD 4,841,537,000, down from HKD 4,900,956,000, indicating a decrease of approximately 1.2%[85]. - The total liabilities decreased to HKD 1,800,810,000 from HKD 1,924,267,000, reflecting a reduction of about 6.4%[85]. - The company's liquidity ratio was 1.62 as of June 30, 2024, slightly up from 1.55 as of December 31, 2023[43]. Research and Development - Research and development expenses for the six months ended June 30, 2024, were HKD 82,895,000, up 15.9% from HKD 71,489,000 in the previous year[117].

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 備 性 亦 無 發 表 聲 明，並 表 明 不 會 就 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。 IMPRO PRECISION INDUSTRIES LIMITED 鷹普精密工業有限公司 （於開曼群島註冊成立的有限公司） （股份代號：1286） 截 至 二 零 二 四 年 六 月 三 十 日 止 六 個 月 中 期 業 績 公 告 鷹 普 精 密 工 業 有 限 公 司（「本 公 司」）董 事 會（「董 事 會」）欣 然 宣 佈 本 公 司 及 其 附 屬 公 司 截 至 二 零 二 四 年 六 月 三 十 日 止 六 個 月 的 中 期 業 績。本 公 告 列 載 本 公 司 二 零 二 四 年 度 中 期 報 告 全 文，並 符 合 香 港 聯 合 交 易 所 有 限 公 司 證 券 上 市 規 則（「上 市 規 則」）中 有 關 ...

Financial Performance - The total revenue for 2023 was HKD 4,604.4 million, representing a growth rate of 5.7%[16] - Revenue for the year ended December 31, 2023, was HKD 4,604.4 million, representing a 5.7% increase from HKD 4,354.7 million in 2022[31] - The company's revenue for the year ended December 31, 2023, increased by 5.7% to HKD 4,604.4 million, compared to HKD 4,354.7 million in 2022[52] - The net profit for the year was HKD 586.8 million, with a net profit margin of 12.7%, down from 13.4%[52] - Adjusted profit attributable to shareholders was HKD 532.0 million, a decline of 18.0% compared to HKD 649.1 million in 2022[31] - Gross profit decreased by 6.6% to HKD 1,178.3 million, with a gross margin of 25.6%, down from 29.0% in the previous year[31] - EBITDA for 2023 was HKD 1,224.9 million, reflecting a 5.1% increase from HKD 1,165.5 million in 2022[31] - The net cash generated from operating activities of HKD 1,281.4 million, a significant increase of 53.0% from HKD 837.5 million in the previous year[31] - The company declared a total dividend of HKD 16.0 cents per share for the year, consistent with the previous year[39] - The company paid dividends to equity shareholders amounting to HKD 301,685,000 in 2023, compared to HKD 286,261,000 in 2022, reflecting a year-on-year increase of about 5.4%[198] Market and Operational Insights - The company serves over 1,000 customers from more than 30 countries and regions[17] - The company operates 21 production facilities globally, with 19 currently in operation and 2 undergoing equipment installation[18] - The company has established a global footprint with sales offices in China, the USA, Luxembourg, Germany, Turkey, Hong Kong, and Mexico[18] - The company is the fifth largest independent investment casting manufacturer globally and the largest in China[15] - It ranks as the third largest precision machining company in the automotive, aerospace, and hydraulic end markets[15] - The group manufactures precision machining parts in three countries: China, Turkey, and Mexico[20] - The group focuses on high-precision and high-complexity components, particularly in the aerospace, automotive, and medical sectors[19][20] Revenue Breakdown by Segment - The investment in the precision casting segment accounted for 41.6% of the group's revenue for the year ending December 31, 2023[19] - The precision machining segment contributed 39.3% to the group's revenue for the year ending December 31, 2023[20] - The sand casting segment represented 17.9% of the group's revenue for the year ending December 31, 2023[22] - Surface treatment services accounted for 1.2% of the group's revenue for the year ending December 31, 2023[23] - Over half of the precision castings were sold to the Americas, followed by Europe and Asia, including China[19] - Approximately half of the precision machining products were sold to Europe, with about one-third to the Americas[20] Awards and Recognition - The group received the "Annual Outstanding ESG Enterprise" award for three consecutive years from the Hong Kong Economic Journal[27] - The group was awarded the "Excellence Award for Listed Companies" by the Hong Kong Economic Journal for three consecutive years in December 2023[28] - The group has been awarded the "Outstanding ESG Company" by the Hong Kong Economic Journal for three consecutive years, highlighting its commitment to sustainable finance[89] - The group received the "Outstanding Green and Sustainable Loan Issuer (Precision Manufacturing) - Excellence in Sustainable Development Performance Indicators" from the Hong Kong Quality Assurance Agency[89] Financial Management and Governance - Total debt as of December 31, 2023, was HKD 2,257.8 million, slightly up from HKD 2,205.9 million in 2022[33] - Net debt decreased to HKD 1,626.9 million from HKD 1,722.6 million in the previous year[33] - The adjusted return on equity was 11.5%, down from 14.9% in 2022[33] - The interest coverage ratio decreased to 6.2 from 13.4 in the previous year[33] - The company has adopted prudent financial management practices to allocate sufficient financial resources to its subsidiaries while monitoring foreign exchange risks related to its revenue and costs denominated in multiple currencies[77] - The board believes that good corporate governance is essential for protecting shareholder interests and enhancing corporate value[91] - The company has adhered to all provisions of the Corporate Governance Code, with a significant degree of compliance with best practices[91] Sustainability and Environmental Impact - The company achieved a significant reduction in greenhouse gas emissions density by 41.1%, energy consumption density by 32.4%, and water consumption density by 57.9% compared to 2020[88] - The company is committed to sustainable development and has established strategic partnerships with industry leaders to enhance product quality and promote a safe production environment[87] - The company plans to continue optimizing production processes and investing in reusable energy to further reduce its environmental impact[88] Future Outlook and Strategic Initiatives - The company forecasts a sales growth of approximately 5% to 10% for 2024, despite potential cyclical fluctuations in some end markets[50] - The international aviation market is expected to continue its recovery, contributing to strong growth in the aviation terminal business[50] - The company plans to enhance its presence in the aviation and energy markets, which have shown significant growth potential[47] - The company is actively developing its medical terminal business, which is anticipated to significantly contribute to profit growth in the future[50] - The company plans to merge its Foshan Meitan and Nantong No. 12 factories to enhance production capacity and operational efficiency[50] Employee and Management Insights - As of December 31, 2023, the company had 7,681 full-time employees, with 5,858 from China and 1,823 from Turkey[78] - Total employee costs for the year ended December 31, 2023, amounted to HKD 1,167.0 million, an increase from HKD 1,115.3 million in 2022[78] - The company has a strong management team with extensive experience in industrial engineering and finance, including certifications such as CFA and Six Sigma[132] - The leadership team is committed to fostering innovation and sustainability within the organization, aligning with global market trends[132] Shareholder and Capital Structure - The company declared a first interim dividend of HKD 0.08 per share, totaling approximately HKD 150.9 million, paid on September 6, 2023[136] - A second interim dividend of HKD 0.08 per share is expected to be paid in April 2024, totaling around HKD 151.0 million[136] - As of December 31, 2023, the company's distributable reserves for dividends amounted to HKD 1,821.3 million, an increase from HKD 1,804.9 million in 2022[140] - The largest customer accounted for approximately 11.9% of the group's revenue, while the top five customers collectively represented about 39.5% of total revenue for the fiscal year[142]

Financial Performance - Revenue for the year 2023 was HKD 4,604.4 million, an increase of 5.7% compared to HKD 4,354.7 million in 2022[2] - Gross profit decreased by 6.6% to HKD 1,178.3 million, with a gross profit margin of 25.6% compared to 29.0% in 2022[2] - Profit attributable to shareholders increased by 0.5% to HKD 585.1 million, while adjusted profit decreased by 18.0% to HKD 532.0 million[3] - Basic earnings per share for the year were HKD 31.0, slightly up from HKD 30.9 in 2022[3] - Total revenue for the year ended December 31, 2023, was HKD 4,604.4 million, representing a 5.7% increase from HKD 4,354.7 million in the previous year[11] - Adjusted net profit attributable to shareholders was HKD 532.0 million, a decline of 18.0% from HKD 649.1 million in 2022[22] - EBITDA for the year was HKD 1,224.9 million, reflecting a 5.1% increase compared to HKD 1,165.5 million in the prior year[22] - The net profit for the year ended December 31, 2023, was HKD 586,763,000, slightly up from HKD 582,780,000 in 2022, representing a growth of 0.4%[57] Market Performance - The sales in the aviation, energy, and medical end markets showed strong growth, with an increase of 47.7%[4] - Revenue from the aerospace, energy, and medical sectors surged by 47.7% year-on-year to HKD 696.1 million, driven by the recovery of the global aerospace market and the acquisition of Foshan Meiduan[5] - The energy end market saw a remarkable increase of 134.8% in sales, primarily due to the aforementioned acquisition[5] - The agricultural machinery end market revenue rose by 19.2% to HKD 421.0 million, benefiting from sustained demand in the U.S. region[5] - The automotive sector's total revenue was HKD 1,694.7 million, a slight decrease of 0.3% compared to the previous year[8] - The commercial vehicle segment experienced a revenue decline of 4.0% to HKD 859.8 million, influenced by decreased demand in the U.S. and European markets[6] - The precision machining and other businesses achieved a significant growth of 21.7%, driven by the acquisition of hydraulic business in the second half of 2022[9] Operational Challenges - The company faced significant challenges in the second half of 2023, with a notable decline in demand in the diversified industrial end market[4] - The new factory in Mexico recorded a tax loss of over HKD 1 million due to rising operational costs and inflation[4] - The Nantong factory is still in the reconstruction phase after a fire, leading to a tax loss of over HKD 3 million for the year[4] - Interest costs for the year increased significantly, exceeding HKD 5 million, impacting overall profitability[4] Cash Flow and Financial Management - Operating cash flow increased by 53.0% to HKD 1,281.4 million, after capital expenditures of HKD 711.4 million and dividends of HKD 301.7 million were paid[12] - The company effectively managed working capital, with trade receivables and inventory levels decreasing compared to the previous year[12] - The group recorded other income of HKD 20.0 million for the year ended December 31, 2023, compared to a loss of HKD 24.6 million in 2022, primarily due to insurance compensation of HKD 17.2 million from the Nantong fire incident and net exchange gains of HKD 7.4 million[29] - The cash flow from operating activities increased mainly due to a reduction in working capital[42] Future Outlook - The group expects sales growth in 2024 to be between 5% and 10% year-on-year, driven by order backlog and new project developments[17] - The aviation terminal business is anticipated to continue strong growth due to the ongoing recovery of the international aviation market and reduced competition in the supply chain[18] - The group plans to invest approximately HKD 550 million in capital expenditures in 2024, with around HKD 260 million allocated to the Mexico SLP area[19] - The group will continue to focus on the aviation, energy, and medical sectors, leveraging its competitive advantages in the automotive terminal market[20] Corporate Governance and Compliance - The company has adhered to all corporate governance code provisions as of December 31, 2023, with a high degree of compliance to best practices[96] - The chairman and CEO roles are held by the same individual, Mr. Lu, which the board believes benefits the management of the group[97] - All directors have confirmed compliance with the standards for securities trading as of December 31, 2023[98] - The Audit Committee reviewed the annual consolidated financial statements for the year ending December 31, 2023, and confirmed compliance with applicable accounting standards and legal regulations[103]