[Corporate Information](index=2&type=section&id=Corporate%20Information) This section provides fundamental corporate details and contact information - The chapter details the company's fundamental information, including its board and committee members, principal bankers, auditors, registered office, and main business locations[4](index=4&type=chunk)[5](index=5&type=chunk)[6](index=6&type=chunk)[8](index=8&type=chunk) [Chairman's Statement](index=4&type=section&id=Chairman%27s%20Statement) The Chairman's Statement reviews FY2025 performance, noting similar financial results to FY2024 despite typhoon impacts, and outlines future growth strategies focusing on innovation, digitalization, and capacity expansion amidst market uncertainties - Despite the impact of Typhoon Ma-on on the Hai Duong factory in Vietnam, FY2025 financial performance was comparable to FY2024, with results expected to be better without the incident[13](index=13&type=chunk)[18](index=18&type=chunk) - Company strategic priorities include **product innovation** (developing high-elasticity functional fabrics and expanding into non-apparel markets), **digital transformation** (updating digital core, establishing integrated data platforms for AI, and providing digital product versions to shorten sales cycles), and **capacity expansion** (new Nam Dinh factory in Vietnam opened July 2024, aiming for full production of high-performance fabrics)[14](index=14&type=chunk)[15](index=15&type=chunk)[16](index=16&type=chunk) - Amidst market uncertainties from US tariffs, the company prioritizes strict cost control and inventory management, expecting significant medium-term growth through product line and production base expansion[21](index=21&type=chunk)[24](index=24&type=chunk) [Management Discussion and Analysis](index=6&type=section&id=Management%20Discussion%20and%20Analysis) This section details the Group's business and financial performance, highlighting a 6.7% revenue increase driven by volume, stable net profit, decreased gross margin, increased net debt, and reduced capital expenditure, with an optimistic outlook for medium-term growth despite short-term challenges [Business and Financial Review](index=7&type=section&id=BUSINESS%20AND%20FINANCIAL%20REVIEW) In FY2025, Group revenue grew 6.7% to **HKD 5.058 billion** driven by volume, while net profit attributable to shareholders remained stable at **HKD 168 million**, gross margin declined to **7.6%**, net debt increased, and capital expenditure significantly decreased by **69.4%** to **HKD 310 million** Key Financial Data for FY2025 (Million HKD) | Metric | FY2025 (Million HKD) | FY2024 (Million HKD) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Revenue** | 5,057.6 | 4,739.0 | +6.7% | | **Cost of Sales** | 4,673.6 | 4,241.6 | +10.2% | | **Gross Profit** | 384.0 | 497.4 | -22.8% | | **Profit Attributable to Shareholders** | 167.6 | 167.1 | +0.3% | | **Distribution and Selling Expenses** | 55.4 | 43.2 | +28.2% | | **Administrative Expenses** | 165.3 | 194.3 | -14.9% | | **Finance Costs** | 61.6 | 60.5 | +1.8% | Key Financial Ratios | Metric | FY2025 | FY2024 | | :--- | :--- | :--- | | **Gross Margin** | 7.6% | 10.5% | | **Return on Equity** | 5.5% | 5.8% | | **Interest Coverage Ratio** | 4.4倍 | 4.0倍 | | **Current Ratio** | 1.2 | 1.2 | | **Quick Ratio** | 0.7 | 0.8 | | **Capital Gearing Ratio** | 47.1% | 50.2% | | **Debt-to-Equity Ratio** | 84.2% | 87.6% | - Total capital expenditure decreased by **69.4%** year-on-year to **HKD 310.1 million**, primarily due to reduced investment in the Vietnam Nam Dinh factory[58](index=58&type=chunk)[60](index=60&type=chunk) - The Group hedges a portion of its foreign exchange risk through forward foreign exchange contracts, primarily involving USD, RMB, and VND[65](index=65&type=chunk)[67](index=67&type=chunk) [Environmental and Social Reporting](index=12&type=section&id=ENVIRONMENTAL%20AND%20SOCIAL%20REPORTING) The Group received recognition for its environmental protection efforts, with subsidiaries in Nansha and Hong Kong awarded 'Guangdong-Hong Kong Cleaner Production Partners (Manufacturing)' - The Group's subsidiaries in Nansha and Hong Kong were awarded 'Guangdong-Hong Kong Cleaner Production Partners (Manufacturing)' in October 2024[77](index=77&type=chunk)[84](index=84&type=chunk) [Product Research and Development](index=12&type=section&id=PRODUCT%20RESEARCH%20AND%20DEVELOPMENT) The company is committed to product innovation, with its Nansha subsidiary receiving multiple industry awards for new products, including 'Top 30 Chinese Knitting Industry Enterprises of 2023' - The company's Nansha subsidiary received multiple awards for its innovative products, including 'Top 30 Chinese Knitting Industry Enterprises of 2023' and 'Excellence Award for China Popular Fabric Enterprises'[79](index=79&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk)[85](index=85&type=chunk) [Employees and Remuneration Policies](index=12&type=section&id=EMPLOYEES%20AND%20REMUNERATION%20POLICIES) As of March 31, 2025, the Group's full-time employee count increased from 4,874 to 5,115, with remuneration policies remaining largely unchanged, based on performance, skills, and knowledge, supplemented by additional benefits Full-time Employee Count | Fiscal Year | Full-time Employees | | :--- | :--- | | **2025** | 5,115 | | **2024** | 4,874 | [Dividends](index=13&type=section&id=DIVIDENDS) The Board recommends a final dividend of HKD 5 cents per share, bringing the total FY2025 dividend to HKD 12 cents per share, consistent with the previous fiscal year FY2025 Dividend Details (HK Cents per Share) | Dividend Type | 2025 | 2024 | | :--- | :--- | :--- | | **Interim Dividend** | 7 | 7 | | **Final Dividend (Proposed)** | 5 | 5 | | **Total Full-Year Dividend** | 12 | 12 | [Prospect and Outlook](index=13&type=section&id=PROSPECT%20AND%20OUTLOOK) Management is optimistic about business prospects, anticipating medium-term growth in FY2026 driven by the full recovery of the Hai Duong factory, ramp-up of the Nam Dinh factory, focus on high-value functional synthetic fabrics, and expected interest rate reductions - FY2025 EBITDA increased by **12.5%** to **HKD 473.4 million**, indicating improved operational efficiency[89](index=89&type=chunk)[93](index=93&type=chunk) - Due to typhoon impact, the Vietnam Hai Duong factory shifted from a profit of **HKD 21.1 million** to a loss of **HKD 25.8 million**, with management expecting a recovery to 2024 profitability levels in FY2026[90](index=90&type=chunk)[93](index=93&type=chunk) - The newly established Vietnam Nam Dinh factory recorded a first-year loss of **HKD 103.7 million**, but management believes it has strong prospects and will contribute to the Group's growth[91](index=91&type=chunk)[94](index=94&type=chunk) - Excluding special events like the typhoon and new factory start-up losses, the Group's FY2025 profit could have reached approximately **HKD 304.2 million**[95](index=95&type=chunk)[101](index=101&type=chunk) - The Group faces a complex external environment including trade tariffs, weak consumer sentiment, and high inflation; short-term financial performance will be affected by tariff negotiations, but the company is focused on developing high-value fabric business for medium to long-term growth[96](index=96&type=chunk)[97](index=97&type=chunk)[101](index=101&type=chunk) [Profiles of Directors and Senior Management](index=14&type=section&id=Profiles%20of%20Directors%20and%20Senior%20Management) This section provides detailed biographies of the company's executive directors, independent non-executive directors, and senior management, including their ages, positions, responsibilities, professional qualifications, and extensive experience in the textile and related industries [Executive Directors](index=15&type=section&id=EXECUTIVE%20DIRECTORS) This section introduces the backgrounds of three executive directors: Chairman and CEO Mr. Okutomi Masaru, CFO and Company Secretary Mr. To Kit Wai, and Mr. Fukumoto Kyuichi, responsible for budget control and Vietnam business expansion, all possessing extensive experience in textiles, finance, and management [Independent Non-Executive Directors](index=16&type=section&id=INDEPENDENT%20NON-EXECUTIVE%20DIRECTORS) This section introduces the backgrounds of four independent non-executive directors: Dr. Chan Yu Kwong, Mr. Ng Ching Wah, Mr. Sze Kwok Wing, and Ms. Ling Chi Wo, who bring broad expertise and experience in corporate management, telecommunications, investment banking, and the apparel industry [Senior Management](index=18&type=section&id=SENIOR%20MANAGEMENT) This section introduces the company's senior management team, covering COOs, CMO, CIO, and general managers/deputy general managers for HR, R&D, engineering, finance, and sales across Vietnam and China, all with over 20 years of senior experience in their respective fields [Directors' Report](index=20&type=section&id=Directors%27%20Report) This report outlines the Group's principal activities, business review, risk factors, financial performance, dividend policy, share repurchases, major customers and suppliers, and continuing connected transactions for FY2025, confirming compliance with regulations and providing future outlook [Principal Risks and Uncertainties](index=21&type=section&id=PRINCIPAL%20RISKS%20AND%20UNCERTAINTIES) The Group faces principal risks including business risks from macroeconomic and political factors like US-China tensions and tariffs, strategic risks in achieving objectives, legal and compliance risks from contracts or regulations, and policy risks from changes in operating country policies - The Group's principal risks include **business risks** (US-China tensions, tariffs, global economic slowdown, inflation, and exchange rate fluctuations), **strategic risks** (achieving strategic objectives like acquisitions and joint ventures), **legal and compliance risks** (unenforceable contracts, litigation, or regulatory sanctions), and **policy risks** (changes in government policies, such as environmental regulations, in operating countries potentially leading to increased costs)[140](index=140&type=chunk)[141](index=141&type=chunk)[142](index=142&type=chunk)[150](index=150&type=chunk) [Purchase, Sale or Redemption of Shares](index=24&type=section&id=PURCHASE%2C%20SALE%20OR%20REDEMPTION%20OF%20SHARES) In FY2025, the company repurchased 7.167 million shares on the Stock Exchange for approximately **HKD 11.14 million**, all of which were cancelled to enhance net asset value and earnings per share for overall shareholder benefit FY2025 Share Repurchase Details | Month of Repurchase | Number of Shares Repurchased | Highest Price per Share (HKD) | Lowest Price per Share (HKD) | Total Consideration (HKD) | | :--- | :--- | :--- | :--- | :--- | | 2024年7月 | 3,027,000 | 1.75 | 1.63 | 5,101,260 | | 2024年12月 | 4,140,000 | 1.48 | 1.42 | 6,036,710 | | **Total** | **7,167,000** | - | - | **11,137,970** | [Major Customers and Suppliers](index=25&type=section&id=MAJOR%20CUSTOMERS%20AND%20SUPPLIERS) In FY2025, the Group experienced high customer and supplier concentration, with the top five customers accounting for **74.4%** of total sales and the largest customer for **45.0%**, while the top five suppliers accounted for **64.4%** of total purchases, with the largest supplier for **39.0%** - Sales to the top five customers accounted for **74.4%** of total sales, with the largest customer accounting for **45.0%**[185](index=185&type=chunk) - Purchases from the top five suppliers accounted for **64.4%** of total purchases, with the largest supplier accounting for **39.0%**[185](index=185&type=chunk) - Major shareholder Toray accounted for approximately **0.8%** of the Group's total purchases and **0.3%** of total sales, constituting continuing connected transactions[186](index=186&type=chunk)[187](index=187&type=chunk) [Continuing Connected Transactions](index=31&type=section&id=CONTINUING%20CONNECTED%20TRANSACTIONS) The Group engaged in several continuing connected transactions in FY2025, primarily involving sales of knitted fabrics to Crystal Group and procurement of yarn and sales of fabrics with major shareholder Toray Group, all conducted within annual caps and deemed fair and reasonable Transactions with Crystal Group | Transaction Type | FY2025 Annual Cap (Million HKD) | FY2025 Actual Transaction Value (Million HKD) | | :--- | :--- | :--- | | Sales of Knitted Fabric | 1,500 | 961.4 | Transactions with Toray Group | Transaction Type | FY2025 Annual Cap (Million HKD) | FY2025 Actual Transaction Value (Million HKD) | | :--- | :--- | :--- | | Procurement of Yarn | 100 | 24.8 | | Sales of Fabric | 70 | 13.1 | [Corporate Governance Report](index=35&type=section&id=Corporate%20Governance%20Report) This report details the company's corporate governance practices for FY2025, highlighting adherence to most Code provisions with two deviations: the Chairman and CEO roles held by the same individual, and one independent non-executive director's absence from the AGM [Corporate Governance Practice of the Company](index=36&type=section&id=A.%2E%20CORPORATE%20GOVERNANCE%20PRACTICE%20OF%20THE%20COMPANY) The company complied with most applicable Code provisions in FY2025, with two deviations: the Chairman and CEO roles are combined, and an independent non-executive director was absent from the 2024 AGM - Deviation noted: The roles of Chairman and Chief Executive Officer are held by Mr. Okutomi Masaru; the company believes this arrangement provides strong leadership, with sufficient checks and balances through Board and senior management consultation on all major decisions[265](index=265&type=chunk)[268](index=268&type=chunk) - Deviation noted: Independent Non-Executive Director Dr. Chan Yu Kwong was unable to attend the Annual General Meeting on August 15, 2024, due to other commitments[266](index=266&type=chunk)[268](index=268&type=chunk) [Board Committees](index=44&type=section&id=D.%2E%20BOARD%20COMMITTEES) The Board has three main committees—Audit, Nomination, and Remuneration—all chaired by independent non-executive directors, overseeing financial reporting, internal controls, director nominations, and executive compensation, reporting regularly to the Board - **Audit Committee**: Composed of four independent non-executive directors, chaired by Mr. Sze Kwok Wing; held 4 meetings during the year, reviewed financial reports and internal control system effectiveness, and recommended re-appointment of PricewaterhouseCoopers as auditor[324](index=324&type=chunk)[325](index=325&type=chunk)[330](index=330&type=chunk) - **Nomination Committee**: Majority members are independent non-executive directors, chaired by Mr. Ng Ching Wah; held 1 meeting during the year, reviewed the implementation of the Board diversity policy, and made recommendations on director rotation and re-election[336](index=336&type=chunk)[337](index=337&type=chunk)[338](index=338&type=chunk) - **Remuneration Committee**: Majority members are independent non-executive directors, chaired by Dr. Chan Yu Kwong; held 1 meeting during the year, reviewed the remuneration of directors and senior management[351](index=351&type=chunk)[352](index=352&type=chunk)[353](index=353&type=chunk) [Risk Management and Internal Control](index=50&type=section&id=I.%2E%20RISK%20MANAGEMENT%20AND%20INTERNAL%20CONTROL) The Board is responsible for establishing and maintaining effective risk management and internal control systems, which were reviewed and deemed effective and adequate in FY2025, with no significant deficiencies identified - The Group has established a comprehensive risk management framework covering risk identification, assessment, management, and reporting, with a Risk Management Committee for oversight[369](index=369&type=chunk)[370](index=370&type=chunk) - The internal audit department independently assesses risk management, internal control, and governance systems, reporting to the Audit Committee[376](index=376&type=chunk)[377](index=377&type=chunk) - The company has a whistleblowing policy and channels for employees and business partners to raise concerns about potential misconduct[385](index=385&type=chunk)[389](index=389&type=chunk) - The Board conducted an annual review of the systems in FY2025 and deemed the risk management and internal control systems effective and adequate[386](index=386&type=chunk)[387](index=387&type=chunk) [Independent Auditor's Report](index=55&type=section&id=Independent%20Auditor%27s%20Report) The Independent Auditor's Report by PricewaterhouseCoopers provides an unmodified opinion on the Group's consolidated financial statements for the year ended March 31, 2025, confirming a true and fair view of the financial position, performance, and cash flows, with 'Revenue Recognition' identified as a key audit matter [Opinion](index=56&type=section&id=OPINION) Auditor PricewaterhouseCoopers issued an unmodified opinion, stating that the consolidated financial statements present a true and fair view of the Group's financial position as of March 31, 2025, and its financial performance and cash flows for the year then ended, in compliance with Hong Kong Financial Reporting Standards and the Hong Kong Companies Ordinance - The auditor issued an unmodified opinion (clean opinion) on the financial statements[410](index=410&type=chunk)[413](index=413&type=chunk) [Key Audit Matters](index=57&type=section&id=KEY%20AUDIT%20MATTERS) The key audit matter for the year was 'Revenue Recognition' due to the high volume of transactions across multiple regions and customers, with audit procedures focusing on internal control testing, sample testing of sales transactions, and cut-off testing - The key audit matter was **revenue recognition**, primarily due to the high volume of transactions involving multiple regions and customers[419](index=419&type=chunk)[424](index=424&type=chunk) - Auditor procedures included evaluating and testing internal controls over sales processes, sampling sales transaction invoices and shipping documents, testing transactions around year-end to ensure correct accounting period recognition, and testing related journal entries[425](index=425&type=chunk)[426](index=426&type=chunk) [Financial Information](index=60&type=section&id=Financial%20Information) This section contains the Group's complete consolidated financial statements for the year ended March 31, 2025, including the consolidated statement of profit or loss, balance sheet, cash flows, and detailed notes, showing annual revenue of **HKD 5.058 billion** and total equity of **HKD 2.883 billion** [Consolidated Statement of Profit or Loss](index=61&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) For the year ended March 31, 2025, the Group's revenue increased by 6.7% to **HKD 5.058 billion**, though gross profit decreased to **HKD 384 million** due to higher cost of sales, with profit for the year at **HKD 159 million** and basic earnings per share at **HKD 0.12** Consolidated Statement of Profit or Loss Summary (Thousand HKD) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 5,057,570 | 4,739,010 | | Gross Profit | 383,985 | 497,437 | | Operating Profit | 200,314 | 275,526 | | Profit Before Income Tax | 194,257 | 202,862 | | **Profit for the Year** | **159,417** | **172,458** | | **Profit Attributable to Equity Holders of the Company** | **167,597** | **167,118** | | Basic Earnings Per Share (HKD) | 0.12 | 0.12 | [Consolidated Balance Sheet](index=62&type=section&id=Consolidated%20Balance%20Sheet) As of March 31, 2025, the Group's total assets were **HKD 5.310 billion**, a slight decrease from the previous year, with total liabilities at **HKD 2.427 billion** and total equity at **HKD 2.883 billion** Consolidated Balance Sheet Summary (Thousand HKD) | Item | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | **Non-current Assets** | 2,840,658 | 2,816,635 | | **Current Assets** | 2,469,708 | 2,749,336 | | **Total Assets** | **5,310,366** | **5,565,971** | | **Current Liabilities** | 2,087,294 | 2,248,121 | | **Non-current Liabilities** | 340,178 | 351,396 | | **Total Liabilities** | **2,427,472** | **2,599,517** | | **Equity Attributable to Equity Holders of the Company** | 2,882,690 | 2,954,272 | | **Total Equity** | **2,882,894** | **2,966,454** | [Consolidated Statement of Cash Flows](index=65&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) For the year ended March 31, 2025, the Group generated **HKD 384 million** in net cash from operating activities, used **HKD 255 million** in investing activities, and **HKD 364 million** in financing activities, resulting in a net decrease in cash and cash equivalents of **HKD 234 million** Consolidated Statement of Cash Flows Summary (Thousand HKD) | Item | 2025 | 2024 | | :--- | :--- | :--- | | **Net Cash Generated from Operating Activities** | 384,051 | 540,854 | | **Net Cash Used in Investing Activities** | (254,567) | (666,510) | | **Net Cash Used in Financing Activities** | (363,502) | (162,022) | | **Net Decrease in Cash and Cash Equivalents** | (234,018) | (287,678) | | **Cash and Cash Equivalents at Beginning of Year** | 893,889 | 1,187,110 | | **Cash and Cash Equivalents at End of Year** | 666,507 | 893,889 | [Notes to the Consolidated Financial Statements](index=66&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes to the financial statements provide detailed explanations and supplementary information on financial statement items, including accounting policies, segment information, balance sheet and profit or loss details, related party transactions, commitments, and contingent liabilities Revenue by Region (Thousand HKD) | Region | 2025 | 2024 | | :--- | :--- | :--- | | Vietnam | 2,568,849 | 2,329,801 | | China | 1,372,531 | 1,224,907 | | Indonesia | 234,020 | 151,641 | | Bangladesh | 211,605 | 278,172 | | Cambodia | 190,000 | 178,175 | | Other | 580,565 | 576,114 | | **Total** | **5,057,570** | **4,739,010** | - High customer concentration: Customer A and Customer B accounted for approximately **45%** and **19%** of the Group's revenue, respectively[592](index=592&type=chunk) - As of March 31, 2025, the Group's total bank borrowings were **HKD 1.221 billion**, with an additional **HKD 125 million** loan from non-controlling interests; the Group has total bank financing facilities of approximately **HKD 3.669 billion**, of which **HKD 2.448 billion** remains unutilized[762](index=762&type=chunk)[766](index=766&type=chunk) [Financial Summary](index=167&type=section&id=Financial%20Summary) This section provides a summary of the Group's key financial data for the past five fiscal years (2021-2025), including consolidated results and major items from the consolidated balance sheet, illustrating trends in the Group's financial performance and position Five-Year Consolidated Results Summary (Million HKD) | Year Ended March 31 | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenue** | 5,058 | 4,739 | 5,019 | 6,066 | 5,385 | | **Gross Profit** | 384 | 497 | 490 | 776 | 862 | | **Profit Attributable to Equity Holders of the Company** | 168 | 167 | 269 | 573 | 721 | Five-Year Consolidated Balance Sheet Summary (Million HKD) | As of March 31 | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Non-current Assets** | 2,841 | 2,817 | 2,296 | 2,124 | 2,069 | | **Current Assets** | 2,470 | 2,749 | 3,233 | 3,820 | 3,143 | | **Total Assets** | 5,310 | 5,566 | 5,529 | 5,944 | 5,211 | | **Current Liabilities** | 2,087 | 2,248 | 2,191 | 2,262 | 1,625 | | **Non-current Liabilities** | 340 | 351 | 250 | 252 | 233 | | **Total Equity** | 2,883 | 2,966 | 3,089 | 3,431 | 3,354 | [Schedule of Group's Properties](index=168&type=section&id=Schedule%20of%20Group%27s%20Properties) This section lists the Group's principal properties held for own use as of March 31, 2025, including industrial and office properties in Hong Kong, Guangzhou Nansha (China), and Hai Duong and Nam Dinh provinces (Vietnam), detailing their overview, lot numbers, and lease terms - The Group holds industrial and office properties in Hong Kong, Guangzhou Nansha (China), and Hai Duong and Nam Dinh provinces (Vietnam) for its own operations[1043](index=1043&type=chunk)[1044](index=1044&type=chunk)[1047](index=1047&type=chunk) [Glossary](index=170&type=section&id=Glossary) This section defines and explains specific terms and abbreviations used in the annual report to assist readers in understanding the report's content

Core Insights - The data indicates significant trading volume increases for various companies, suggesting heightened investor interest and potential market movements [1][2][3][4][5] Group 1: Companies with Notable Volume Increases - 阳光能源 (00757) reported a volume ratio of 2.35, indicating strong trading activity [2] - 长城汽车 (02333) had a volume ratio of 2.21, reflecting increased investor engagement [2] - 郑煤机 (00564) showed a volume ratio of 1.92, suggesting a notable rise in trading [2] Group 2: Additional Companies with Increased Trading Activity - 万国数据-SW (09698) recorded a volume ratio of 1.83, indicating significant market interest [2] - 映恩生物-B (09606) had a volume ratio of 1.78, reflecting heightened trading activity [2] - 超盈国际控股 (02111) reported a volume ratio of 1.71, suggesting increased investor focus [2] Group 3: Companies with Moderate Volume Ratios - 中国能源建设 (03996) had a volume ratio of 1.70, indicating a solid level of trading activity [2] - 亚信科技 (01675) reported a volume ratio of 1.60, reflecting moderate investor interest [2] - 金宝通 (00320) showed a volume ratio of 1.53, suggesting a rise in trading volume [2] Group 4: Companies with Lower Volume Ratios - 中国水务 (00855) had a volume ratio of 1.52, indicating stable trading activity [2] - 广汽集团 (02238) reported a volume ratio of 1.52, reflecting consistent investor engagement [2] - 凯莱英 (06821) showed a volume ratio of 1.52, suggesting steady trading interest [2]

[Financial Summary](index=1&type=section&id=Financial%20Data) [Consolidated Income Statement](index=1&type=section&id=Consolidated%20Income%20Statement) In FY2025, group revenue grew 6.7% to HK$5.06 billion, but gross profit declined 22.8% to HK$384 million, lowering gross margin to 7.6%; profit attributable to equity holders remained stable at HK$168 million, with basic EPS at HK$0.12 Key Income Statement Data for FY2025 (HK$ Thousand) | Metric | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Revenue** | 5,057,570 | 4,739,010 | +6.7% | | **Gross Profit** | 383,985 | 497,437 | -22.8% | | **Operating Profit** | 200,314 | 275,526 | -27.3% | | **Profit Attributable to Equity Holders of the Company** | 167,597 | 167,118 | +0.3% | | **Basic Earnings Per Share (HK$)** | 0.12 | 0.12 | 0.0% | - Total comprehensive income for the year significantly increased by **95.8%** to **HK$95.12 million** from HK$48.58 million in the prior year, primarily due to a reduced negative impact from foreign currency translation differences[5](index=5&type=chunk) [Consolidated Balance Sheet](index=3&type=section&id=Consolidated%20Balance%20Sheet) As of March 31, 2025, total assets decreased 4.6% to HK$5.31 billion, total liabilities decreased 6.6% to HK$2.43 billion, and total equity slightly decreased 2.8% to HK$2.88 billion, maintaining a stable financial structure despite reduced cash and cash equivalents Key Balance Sheet Data for FY2025 (HK$ Thousand) | Metric | March 31, 2025 | March 31, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Total Assets** | 5,310,366 | 5,565,971 | -4.6% | | **Total Liabilities** | 2,427,472 | 2,599,517 | -6.6% | | **Total Equity** | 2,882,894 | 2,966,454 | -2.8% | | **Cash and Cash Equivalents** | 666,507 | 893,889 | -25.6% | | **Total Borrowings** | 1,346,332 | 1,480,647 | -9.1% | [Segment and Geographical Information](index=7&type=section&id=2%20Segment%20Information) The group operates a single business segment focused on textile manufacturing and trading, with Vietnam and China as the largest markets contributing 50.8% and 27.1% of revenue respectively, both showing year-on-year growth, alongside high customer concentration Revenue by Geographical Region (HK$ Thousand) | Region | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Vietnam** | 2,568,849 | 2,329,801 | +10.3% | | **China** | 1,372,531 | 1,224,907 | +12.0% | | **Bangladesh** | 211,605 | 278,172 | -23.9% | | **Hong Kong** | 75,833 | 139,698 | -45.7% | | **Americas** | 29,119 | 70,845 | -58.9% | - Customer A and Customer B accounted for **45%** and **19%** of the group's total revenue respectively, indicating high customer concentration[16](index=16&type=chunk) - The group's non-current assets are primarily located in **Vietnam (HK$1.55 billion)** and **China (HK$986 million)**[17](index=17&type=chunk) [Dividend Policy](index=11&type=section&id=8%20Dividends) The Board recommended a final dividend of HK$0.05 per share, consistent with the prior year, bringing the total FY2025 dividend to HK$0.12 per share, including the interim dividend, matching the previous fiscal year FY2025 Dividend Details | Dividend Type | Amount Per Share (HK Cents) | Total Amount (HK$ Thousand) | | :--- | :--- | :--- | | **Interim Dividend** | 7 | 97,703 | | **Proposed Final Dividend** | 5 | 69,581 | | **Total for Full Year** | 12 | 167,284 | [Management Discussion and Analysis](index=13&type=section&id=Management%20Discussion%20and%20Analysis) [Business and Financial Review](index=13&type=section&id=Business%20and%20Financial%20Review) During the review year, group revenue grew 6.7% driven by an 11.3% increase in sales volume, partially offset by a 4.5% decrease in average selling price; sales cost rose 10.2%, reducing gross margin to 7.6%, while administrative expenses decreased, resulting in a slight 0.3% increase in profit attributable to equity holders - Revenue growth was primarily driven by an **11.3% increase in sales volume**, partially offset by a **4.5% decrease in average selling price**[29](index=29&type=chunk) - Cost of sales increased by **10.2%**, consistent with the revenue growth trend[30](index=30&type=chunk) - The decrease in administrative expenses was mainly due to the reversal of deferred income from the previous year and the reversal of personal income tax provisions in the current year[33](index=33&type=chunk) Key Financial Ratio Changes | Ratio | 2025 | 2024 | | :--- | :--- | :--- | | **Gross Margin** | 7.6% | 10.5% | | **Return on Equity** | 5.5% | 5.8% | | **Interest Coverage Ratio** | 4.4 | 4.0 | [Liquidity, Financial Resources, and Capital Structure](index=15&type=section&id=Liquidity%2C%20Financial%20Resources%2C%20and%20Capital%20Structure) The group's net debt increased from HK$586 million to HK$680 million, with working capital primarily from sales cash flow and bank borrowings; capital expenditure significantly decreased by 69.4% to HK$310 million due to reduced investment in the Vietnam Nam Dinh plant, while liquidity and gearing ratios remained stable or improved - Net debt increased from **HK$586 million** to **HK$680 million**, primarily due to an increase in trade receivables and repayment of bank loans[39](index=39&type=chunk) - Total capital expenditure significantly decreased by **69.4%** to **HK$310 million**, mainly due to reduced capital expenditure investment in the Vietnam Nam Dinh plant[42](index=42&type=chunk) Key Liquidity and Leverage Ratios | Ratio | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | **Current Ratio** | 1.2 | 1.2 | | **Quick Ratio** | 0.7 | 0.8 | | **Capital Gearing Ratio** | 47.1% | 50.2% | | **Debt-to-Equity Ratio** | 84.2% | 87.6% | [Employees and Remuneration Policy](index=17&type=section&id=Employees%20and%20Remuneration%20Policy) As of March 31, 2025, the group's full-time employee count increased to 5,115, with no significant changes in remuneration policy, which is determined by performance, skills, and knowledge, supplemented by allowances and insurance - The number of full-time employees increased from **4,874** to **5,115**[51](index=51&type=chunk) [Outlook and Prospects](index=17&type=section&id=Outlook%20and%20Prospects) [Impact of One-Off Events](index=17&type=section&id=Impact%20of%20One-Off%20Events) FY2025 profit was significantly impacted by two one-off events: a typhoon causing a HK$25.8 million loss at the Vietnam Hai Duong plant, and a HK$104 million loss from the newly commissioned Vietnam Nam Dinh plant, with the Hai Duong plant expected to return to profitability in FY2026 - The Vietnam Hai Duong plant shifted from a **HK$21.1 million profit** in FY2024 to a **HK$25.8 million loss** in FY2025 due to typhoon damage[53](index=53&type=chunk) - The newly commissioned Vietnam Nam Dinh plant recorded a **HK$103.7 million loss** in FY2025[54](index=54&type=chunk) - Excluding these special events, the group's profit was estimated to increase to approximately **HK$304.2 million**[55](index=55&type=chunk) [Market Challenges and Company Strategy](index=18&type=section&id=Market%20Challenges%20and%20Company%20Strategy) The textile industry faces complex challenges including trade tariffs, weak consumer sentiment, and high inflation; the company's strategy focuses on developing high-value functional synthetic fabrics and expanding its customer base through new markets and applications - The industry faces a complex landscape of trade tariffs, soft consumer sentiment, and high inflation, leading to intense market competition[55](index=55&type=chunk) - The company will focus on developing **high-value functional synthetic fabrics** and fostering closer collaboration with brand owners[56](index=56&type=chunk) - Management is optimistic about the business outlook, anticipating the business to enter a **medium-term growth trajectory** in FY2026[57](index=57&type=chunk) [Supplementary Information](index=18&type=section&id=Supplementary%20Information) [Share Repurchases](index=20&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Shares) In FY2025, the company repurchased 7,167,000 shares from the Stock Exchange for approximately HK$11.14 million, all of which were subsequently cancelled to enhance net asset value and earnings per share Share Repurchase Details | Month of Repurchase | Number of Shares Repurchased | Total Consideration (HK$) | | :--- | :--- | :--- | | **July 2024** | 3,027,000 | 5,101,260 | | **December 2024** | 4,140,000 | 6,036,710 | | **Total** | **7,167,000** | **11,137,970** | [Corporate Governance](index=19&type=section&id=The%20Company%27s%20Corporate%20Governance%20Practices) The company generally complied with the Corporate Governance Code in FY2025, with one deviation where the Chairman and CEO roles were combined, though the Board believes collective decision-making and committee oversight prevent excessive power concentration - The company did not comply with Corporate Governance Code Provision C.2.1, which stipulates that the roles of Chairman and Chief Executive Officer should be separate[62](index=62&type=chunk) - The Board believes that power and authority are not overly concentrated under the current structure and will review it periodically[62](index=62&type=chunk) [Audit Committee](index=20&type=section&id=Audit%20Committee) The Audit Committee, comprising four independent non-executive directors and chaired by Mr. Sze Kwok Wing, a qualified accountant, reviewed the financial statements for the fiscal year and discussed accounting principles, internal controls, and financial reporting with management and auditors - The Audit Committee has reviewed the financial statements for FY2025 and held discussions with management and the auditors[68](index=68&type=chunk) - PricewaterhouseCoopers, the auditors, have confirmed that the financial data in the preliminary results announcement is consistent with the audited consolidated financial statements[70](index=70&type=chunk)

Revenue and Sales Performance - Revenue increased by 16.2% to approximately HK$2,667.2 million, driven by a 21.9% increase in sales volume and a 4.7% decrease in average sales price[8] - Overall sales volume and revenue increased by 21.9% and 16.2% respectively during the reporting period, driven by a 28.3% increase in sales volume and a 20.6% increase in revenue at the China Nansha Plant[46] - Revenue for the six months ended 30 September 2024 increased to HK$2,667,177 thousand, up 16.2% compared to HK$2,294,749 thousand in the same period last year[59] - Revenue for the six months ended 30 September 2024 increased to HK$2,667,177 thousand, up from HK$2,294,749 thousand in the same period in 2023[110] - Southeast Asia accounted for the largest portion of revenue at HK$1,586,835 thousand in 2024, up from HK$1,255,195 thousand in 2023[121] Cost and Profitability - Cost of sales rose by 18.6% to approximately HK$2,467.1 million, consistent with the revenue growth[8] - Profit attributable to equity holders decreased by 14.1% to approximately HK$106.9 million[8] - Gross profit margin for the six months ended 30 September 2024 was 7.5%, down from 9.3% in 2023[13] - Gross profit for the six months ended 30 September 2024 decreased to HK$200,086 thousand, down 6.5% compared to HK$213,945 thousand in the same period last year[59] - Operating profit for the six months ended 30 September 2024 decreased to HK$130,232 thousand, down 21.1% compared to HK$165,124 thousand in the same period last year[59] - Profit for the period attributable to equity holders of the Company decreased to HK$106,862 thousand, down 14.1% compared to HK$124,463 thousand in the same period last year[59] - Basic earnings per share for the six months ended 30 September 2024 decreased to HK$0.08, down 11.1% compared to HK$0.09 in the same period last year[59] - Gross profit margin decreased to 7.5% in 2024 from 9.3% in 2023[110] - EBITDA margin declined to 9.4% in 2024 compared to 11.1% in 2023[110] - Net profit margin dropped to 4.0% in 2024 from 5.4% in 2023[110] - Profit attributable to equity holders of the Company declined to HK$106,862 thousand in 2024 from HK$124,463 thousand in 2023[139] - Basic earnings per share decreased to HK$0.08 in 2024 from HK$0.09 in 2023[139] Plant Operations and Production - Loss of approximately HK$48 million incurred at the preliminary operating stage of the newly established Vietnam Nam Dinh Plant[8] - Negative impact of approximately HK$12 million due to temporary suspension and damage at the Vietnam Hai Duong Plant caused by Typhoon Yagi[8] - The Vietnam Nam Dinh Plant entered bulk production in September 2024 with an average monthly production of 1.1 million pounds, expected to increase to 1.5 million pounds per month in the second half of the financial year[49] - The Vietnam Hai Duong Plant's production level resumed to 70% of pre-suspension levels after Typhoon Yagi damage, with full recovery expected to take several months[49] Expenses and Costs - Selling and distribution expenses increased to HK$29.6 million, up from HK$19.0 million in 2023, primarily due to higher freight charges[11] - Administration expenses decreased to HK$78.5 million from HK$82.8 million in 2023[11] - Finance costs slightly decreased by 1% to HK$34.2 million from HK$34.6 million in 2023[11] - Cost of raw materials and consumables used rose to HK$2,139,196 thousand in 2024 compared to HK$1,824,061 thousand in 2023[127] - Employee benefits expenses increased to HK$239,311 thousand in 2024 from HK$218,247 thousand in 2023[127] - Net finance costs were HK$18,003 thousand in 2024, up from HK$5,516 thousand in 2023[130] Financial Position and Ratios - Trade receivables turnover days were 59 days, while trade payables turnover days were 56 days[11] - Total assets as of 30 September 2024 were HK$5,563.3 million, with non-current assets at HK$2,832.8 million and current assets at HK$2,730.5 million[11] - Net debt position increased to HK$673.8 million from HK$585.7 million in March 2024, driven by higher trade receivables and inventories[13] - Current Ratio remained stable at 1.2 as of 30 September 2024 and 31 March 2024[18] - Quick Ratio slightly decreased from 0.8 to 0.7 as of 30 September 2024 compared to 31 March 2024[18] - Gearing Ratio improved significantly from 50.2% to 40.8% as of 30 September 2024[18] - Debt to Equity Ratio decreased from 87.6% to 85.3% as of 30 September 2024[18] - Total assets as of 30 September 2024 were HK$5,563,295 thousand, a slight decrease from HK$5,565,971 thousand as of 31 March 2024[63][66] - Non-current assets increased to HK$2,832,750 thousand from HK$2,816,635 thousand, driven by growth in property, plant, and equipment (HK$2,301,656 thousand)[63] - Current assets decreased to HK$2,730,545 thousand from HK$2,749,336 thousand, with a notable increase in inventories to HK$1,125,113 thousand[63] - Total equity attributable to equity holders rose to HK$2,992,711 thousand from HK$2,954,272 thousand, supported by an increase in reserves to HK$1,717,216 thousand[63][68] - Non-current liabilities decreased to HK$325,685 thousand from HK$351,396 thousand, primarily due to a reduction in other non-current liabilities to HK$150,832 thousand[66] - Current liabilities decreased to HK$2,235,277 thousand from HK$2,248,121 thousand, with a significant reduction in borrowings to HK$1,096,896 thousand[66] - The company's bank borrowings as of 30 September 2024 were HK$1,096,896,000, with HK$1,096,896,000 repayable within 1 year or on demand[186] - The company's retained earnings as of 30 September 2024 were HK$1,133,957,000, with total reserves of HK$1,717,216,000[175] - The Group's bank borrowings repayable within 1 year amounted to HK$979,566,000 as of 30 September 2024, compared to HK$1,092,521,000 as of 31 March 2024[190] - The Group's aggregate banking facilities were approximately HK$3,071,698,000 as of 30 September 2024, with unused facilities amounting to HK$1,974,802,000[192] - The Group's secured borrowings amounted to HK$943,296,000 as of 30 September 2024, down from HK$980,350,000 as of 31 March 2024[193] - The effective interest rate for bank loans ranged from 2.9% to 6.2% for the six months ended 30 September 2024[191] - Trade and bills payables totaled HK$872,825,000 as of 30 September 2024, up from HK$629,757,000 as of 31 March 2024[198] - 86.7% of trade and bills payables were aged 0-60 days as of 30 September 2024, totaling HK$867,771,000[199] - The Group complied with all financial covenants of its bank facilities as of 30 September 2024 and 31 March 2024[194] - Bank borrowings were denominated in HK$, US$, and RMB as of 30 September 2024, compared to only HK$ and RMB as of 31 March 2024[191] Cash Flow and Investments - Total capital expenditure decreased by 80.1% to HK$124.6 million from HK$624.9 million in 2023, mainly due to reduced investment in the Vietnam Nam Dinh Plant[16] - Net cash inflow from operating activities for the six months ended 30 September 2024 was HK$98.28 million, compared to HK$269.925 million in the same period in 2023[70] - Net cash outflow from investing activities for the six months ended 30 September 2024 was HK$106.193 million, compared to HK$360.387 million in the same period in 2023[70] - Net cash outflow from financing activities for the six months ended 30 September 2024 was HK$333.679 million, compared to HK$259.5 million in the same period in 2023[70] - Cash and cash equivalents at 30 September 2024 were HK$548.091 million, compared to HK$808.782 million at 30 September 2023[70] Foreign Exchange and Financial Instruments - Exchange gain shrank by approximately HK$28 million compared to the previous period[8] - The Group managed foreign exchange risks primarily in US Dollars, Renminbi, and Vietnamese Dongs through regular reviews and hedging[20] - Financial assets at fair value through other comprehensive income totaled HK$427,000, all classified under Level 1[90][91] - Derivative financial instruments and foreign currency forward contracts under financial assets at fair value through profit or loss amounted to HK$239,000, classified under Level 2[95] - Total financial assets at fair value were HK$666,000, with HK$427,000 in Level 1 and HK$239,000 in Level 2[96] - Financial liabilities at fair value through profit or loss, including derivative financial instruments and foreign currency forward contracts, totaled HK$294,000, classified under Level 2[102] - No transfers between fair value levels occurred during the six months ended 30 September 2024[103] - No changes were made to the valuation techniques applied as of 31 March 2024[105] Taxation and Dividends - Income tax expense was HK$15.4 million, with an average effective tax rate of 12.8%, down from 15.2% in 2023[11] - Current income tax expense decreased to HK$15,355 thousand in 2024 from HK$22,980 thousand in 2023[132] - Two subsidiaries in the PRC are recognized as High and New-technology Enterprises, entitled to a concessional CIT rate of 15%[134] - The standard PRC CIT rate is 25%, while the Vietnam CIT rate is 20%[134] - Interim dividend declared at HK$7 cents per share for the six-month period ended 30 September 2024, totaling HK$97,703,000 (2023: HK$98,211,000)[145] - Dividends paid to equity holders amounted to HK$69,788 thousand, reflecting the company's commitment to shareholder returns[68] Employee and Remuneration - The company's employee count increased to 5,227 full-time employees as of 30 September 2024, up from 4,874 in March 2024, with no significant changes to its remuneration policy[46] Awards and Recognitions - Two subsidiaries were jointly commended as "Hong Kong-Guangdong Cleaner Production Excellent Partners (Manufacturing)" in October 2024[37] - The Nansha subsidiary was graded as "2023 China Textiles Industry Top 30" by China Knitting Industrial Association in May 2024[38] - The Nansha subsidiary received the "Fabrics China Appraisal Entry Enterprise – Outstanding Award" in August 2024[39] Strategic Plans and Future Outlook - The company plans to strengthen R&D and marketing efforts to expand its customer portfolio and introduce new products, with diversification remaining a key focus for FY2024/25[49] - The company aims to improve profitability in the second half of FY2024/25 through multi-site operations, economies of scale, and flexible resource reallocation[49] Miscellaneous - No material acquisition or disposal of subsidiaries, associates, or joint ventures occurred during the six months ended 30 September 2024[34] - The Group had no material contingent liabilities as of 30 September 2024[35] - The company's production bases are primarily located in the People's Republic of China and Vietnam[72] - The interim condensed consolidated financial information has been prepared in accordance with Hong Kong Accounting Standard 34, "Interim Financial Reporting"[72] - The company has applied new and amended standards, including HKAS 1 and HKFRS 16, which do not have a significant impact on the results and financial position of the group[74] - New standards such as HKFRS 18 and HKFRS 19 will be effective for annual periods on or after 1 April 2027[80] - The Group's financial liabilities showed no material change in contractual undiscounted cash flows compared to 31 March 2024[86] - The Group's business operations are focused on the manufacturing and trading of textile products, with operations in Hong Kong, Macau, China, Vietnam, and associates in China and Sri Lanka[108] - Inventory turnover days improved to 80 days in 2024 from 86 days in 2023[110] - Trade and bills receivables turnover days decreased to 59 days in 2024 from 67 days in 2023[110] - The top two customers accounted for approximately 43% and 21% of the Group's revenue in 2024, compared to 47% and 19% in 2023[121] - Non-current assets in Vietnam increased to HK$1,522,773 thousand in 2024 from HK$1,493,673 thousand in 2023[123] - Other income and other gains/losses netted HK$38,243 thousand in 2024, down from HK$52,960 thousand in 2023[125] - Depreciation of property, plant and equipment increased to HK$110,497 thousand in 2024 from HK$95,365 thousand in 2023[127] - No potential dilutive shares were issued during the period ended 30 September 2024, resulting in diluted earnings per share being the same as basic earnings per share[141] - Property, plant, and equipment balance as at 30 September 2024 was HK$2,301,656,000, compared to HK$2,012,336,000 in 2023[148] - Right-of-use assets balance as at 30 September 2024 was HK$165,816,000, compared to HK$172,645,000 in 2023[150] - Interests in associates and balances with associates as at 30 September 2024 was HK$250,915,000, compared to HK$251,112,000 as at 31 March 2024[151] - Share of net assets and goodwill in associates as at 30 September 2024 was HK$256,643,000 and HK$107,955,000 respectively[153] - The quoted market value of the Group's interest in PT Sri Lanka increased to HK$206,822,000 as of 30 September 2024, up from HK$194,057,000 as of 31 March 2024[155] - The recoverable amount of the Group's interest in PT Sri Lanka was approximately HK$226,470,000 as of 30 September 2024, higher than the net carrying amount of HK$213,677,000[155] - The Group's share of contingent liability related to a pending tax claim against PT Sri Lanka was approximately HK$3,582,000 as of 30 September 2024[155] - Cash and bank deposits held by the Group's associate in the PRC decreased to HK$45,795,000 as of 30 September 2024 from HK$54,885,000 as of 31 March 2024[155] - Trade and bills receivables increased to HK$993,456,000 as of 30 September 2024 from HK$737,683,000 as of 31 March 2024[158] - The top two customers accounted for 48% and 15% of the Group's trade and bills receivables as of 30 September 2024, compared to 38% and 24% as of 31 March 2024[159] - The provision for impairment of trade and bills receivables increased to HK$4,302,000 as of 30 September 2024 from HK$2,000,000 as of 31 March 2024[163] - The company repurchased a total of 3,027,000 shares at an aggregate consideration of HK$5,124,000 during the period ended 30 September 2024, and all repurchased shares were cancelled[166][168] - The company's profit attributable to equity holders for the period ended 30 September 2024 was HK$106,862,000, with total comprehensive income of HK$113,351,000[175] - Dividends paid during the period ended 30 September 2024 amounted to HK$69,788,000[175] - Currency translation differences resulted in a loss of HK$6,489,000, impacting other comprehensive income[68] - The company repurchased and canceled shares worth HK$5,124 thousand, reducing share capital to HK$1,395 thousand[68] - Total comprehensive income for the six months ended 30 September 2024 was HK$110,791 thousand, compared to a total comprehensive loss of HK$18,708 thousand in the same period last year[61] - Total comprehensive income for the six months ended 30 September 2024 attributable to equity holders of the Company was HK$113,351 thousand, compared to a total comprehensive loss of HK$17,592 thousand in the same period last year[61] - Currency translation differences for the six months ended 30 September 2024 resulted in a gain of

Revenue and Sales Performance - Revenue for the six months ended September 30, 2024, increased to HKD 2,667,177 thousand, up 16.2% from HKD 2,294,749 thousand in the same period last year[2] - Revenue for the six months ended September 30, 2024, was HKD 2,667.177 million, compared to HKD 2,294.749 million in the same period in 2023[15] - Revenue for the six months ended September 30, 2024, was HK$2.67 billion, a 16.2% increase from HK$2.29 billion in the same period in 2023[19] - Revenue for the period increased by 16.2% to HKD 2,667.2 million, driven by a 21.9% increase in sales volume and a 4.7% decrease in average selling price[42] - Overall sales volume and revenue increased by 21.9% and 16.2%, respectively, during the reporting period, with the Nansha plant in China showing significant growth of 28.3% in sales volume and 20.6% in revenue[78] Gross Profit and Margins - Gross profit for the six months ended September 30, 2024, decreased to HKD 200,086 thousand, down 6.5% from HKD 213,945 thousand in the same period last year[2] - Gross profit for the six months ended September 30, 2024, was HKD 200.086 million, with a gross profit margin of 7.5%, down from 9.3% in 2023[15] Operating Profit and EBITDA - Operating profit for the six months ended September 30, 2024, decreased to HKD 130,232 thousand, down 21.1% from HKD 165,124 thousand in the same period last year[2] - EBITDA for the six months ended September 30, 2024, was HKD 251.040 million, with an EBITDA margin of 9.4%, compared to 11.1% in 2023[15] - EBITDA for the six months ended September 30, 2024, was HK$251.04 million, compared to HK$254.99 million in the same period in 2023[19] Net Profit and Earnings - Net profit attributable to equity holders for the six months ended September 30, 2024, decreased to HKD 106,862 thousand, down 14.1% from HKD 124,463 thousand in the same period last year[4] - Net profit attributable to equity holders for the six months ended September 30, 2024, was HKD 106.862 million, with a net profit margin of 4.0%, down from 5.4% in 2023[15] - Basic earnings per share for the six months ended September 30, 2024, were HK$0.08, compared to HK$0.09 in the same period in 2023[30] - Profit attributable to equity holders decreased by 14.1% to HKD 106.9 million, impacted by factors including a HKD 48 million loss from the new Vietnam factory, HKD 12 million in losses due to a typhoon, and a HKD 28 million reduction in exchange gains[44][45] - Net profit attributable to equity holders decreased by 14.1% in the six months ended September 30, 2024, compared to the same period in 2023, primarily due to a pre-production loss of HKD 48 million at the new Nam Dinh plant in Vietnam, HKD 12 million in losses from Typhoon Mawar, and a reduction in exchange gains by HKD 28 million[76] Assets and Liabilities - Total assets as of September 30, 2024, were HKD 5,563,295 thousand, slightly down from HKD 5,565,971 thousand as of March 31, 2024[6] - Total liabilities as of September 30, 2024, were HKD 2,560,962 thousand, down from HKD 2,599,517 thousand as of March 31, 2024[9] - Total assets as of September 30, 2024, were HKD 5,563.295 million, up from HKD 5,375.191 million in 2023[15] - Total assets as of September 30, 2024, were HKD 5,563.3 million (March 31, 2024: HKD 5,566.0 million), including non-current assets of HKD 2,832.8 million and current assets of HKD 2,730.5 million[52] - Net debt level increased to HKD 673.8 million (March 31, 2024: HKD 585.7 million) due to higher accounts receivable and inventory[58] Cash and Cash Equivalents - Cash and cash equivalents as of September 30, 2024, decreased to HKD 548,091 thousand, down 38.7% from HKD 893,889 thousand as of March 31, 2024[6] - Cash and bank balances as of September 30, 2024, were HKD 548.407 million, down from HKD 815.528 million in 2023[15] - Cash and bank balances, including fixed deposits, totaled HKD 548.4 million (March 31, 2024: HKD 894.9 million), with significant holdings in USD, RMB, and VND[59] Inventory and Accounts Receivable - Inventory as of September 30, 2024, increased to HKD 1,125,113 thousand, up 9.1% from HKD 1,031,258 thousand as of March 31, 2024[6] - Accounts receivable and bills as of September 30, 2024, increased to HKD 989,154 thousand, up 34.5% from HKD 735,683 thousand as of March 31, 2024[6] - Accounts receivable and notes increased to HKD 993.456 million as of September 30, 2024, with the top two customers accounting for 48% and 15% of the total, respectively[36] - Accounts receivable turnover days were 59 days, while accounts payable turnover days were 56 days[50] Equity and Dividends - Total equity as of September 30, 2024, increased to HKD 3,002,333 thousand, up 1.2% from HKD 2,966,454 thousand as of March 31, 2024[6] - An interim dividend of HK$0.07 per share was declared, totaling HK$97.70 million, consistent with the same period in 2023[33] - An interim dividend of HKD 0.07 per share was declared for the six months ended September 30, 2024, unchanged from the previous year[84] Costs and Expenses - Cost of raw materials and consumables increased to HK$2.14 billion, up 17.3% from HK$1.82 billion in the same period in 2023[27] - Employee benefits expenses, including directors' remuneration, rose to HK$239.31 million, a 9.7% increase from HK$218.25 million in the same period in 2023[27] - Cost of sales rose by 18.6% to HKD 2,467.1 million, in line with the revenue growth[43] - Distribution and sales expenses increased to HKD 29.6 million (2023: HKD 19.0 million), primarily due to higher freight costs, in line with revenue growth[46] - Administrative expenses decreased to HKD 78.5 million (2023: HKD 82.8 million)[48] - Financial costs slightly decreased by 1% to HKD 34.2 million (2023: HKD 34.6 million)[49] Regional Performance - Southeast Asia contributed HK$1.59 billion to revenue, a 26.4% increase from HK$1.26 billion in the same period in 2023[19] - China revenue increased by 24.6% to HK$756.88 million from HK$607.58 million in the same period in 2023[19] Capital Expenditures and Commitments - Capital commitments for property, plant, and equipment amounted to HKD 175.558 million as of September 30, 2024[39] - Capital expenditures decreased by 80.1% to HKD 124.6 million (2023: HKD 624.9 million), mainly due to reduced investment in the Vietnam Nam Dinh plant[61] Corporate Governance and Compliance - The company's Chairman and CEO roles are currently held by the same individual, Mr. Au Fu Shing, which deviates from the Corporate Governance Code's requirement for role separation. However, decisions are made after consulting with knowledgeable board members and senior management, ensuring appropriate checks and balances[90] - All directors confirmed compliance with the standard code for securities transactions during the six months ending September 30, 2024[91] - The Audit Committee, chaired by Mr. Shih Kwok Wing, reviewed the unaudited condensed consolidated financial results for the six months ending September 30, 2024, and oversaw the financial reporting process, internal controls, and risk management[92] - The interim financial results were reviewed by the company's external auditor in accordance with Hong Kong Standard on Review Engagements 2410[92] - The interim results announcement is available on the Hong Kong Stock Exchange website and the company's website, with the interim report to be distributed to shareholders and published on the websites in due course[94] Operational Updates - The Nam Dinh plant in Vietnam began mass production in September 2024, with an average monthly output of 1.1 million pounds, expected to increase to 1.5 million pounds per month in the second half of the fiscal year[79] - The Hai Duong plant in Vietnam, affected by Typhoon Mawar, has restored production to 70% of pre-suspension levels, with full recovery expected to take several months[79] - The company expects improved profitability in the second half of the 2024/25 fiscal year[82] Share Repurchases and Employee Count - The company repurchased 3,027,000 shares for a total consideration of HKD 5,101,260 during the six months ended September 30, 2024, which were subsequently canceled[86] - Total number of full-time employees increased to 5,227 as of September 30, 2024, up from 4,874 as of March 31, 2024[75] Tax and Financial Ratios - The group recorded income tax expenses of approximately HKD 15.4 million (2023: HKD 23.0 million), with an average effective tax rate of 12.8% (2023: 15.2%)[51] - The group's capital structure showed a debt-to-equity ratio of 85.3% (March 31, 2024: 87.6%) and a capital gearing ratio of 40.8% (March 31, 2024: 50.2%)[64] Associates and Impairment - The company's share of profit from associates was HKD 7.316 million, up from HKD 1.620 million in the previous period[34] - The recoverable amount of the company's interest in PT Sri Lanka was HKD 226.470 million, higher than its carrying amount of HKD 213.677 million, resulting in no impairment loss being recognized[34] Accounts Payable and Notes - Accounts payable and notes rose to HKD 872.825 million as of September 30, 2024, with the majority (HKD 867.771 million) aged 0-60 days[39] - Accounts payable and notes turnover days decreased to 56 days in 2024 from 60 days in 2023[15] Inventory and Turnover Days - Inventory turnover days decreased to 80 days in 2024 from 86 days in 2023[15] Non-Current Assets - Non-current assets in Vietnam increased to HK$1.52 billion as of September 30, 2024, from HK$1.49 billion as of March 31, 2024[24] Strategic Focus - The company continues to focus on diversification, cost control, and flexible resource allocation to enhance production efficiency and adaptability[81]

Financial Performance - The Group's revenue for the year was approximately HK$4,665.2 million, a decrease of 7.0% compared to HK$5,018.7 million in the previous year[41]. - Profit attributable to equity holders was approximately HK$167.1 million, a decrease of 37.8% compared to HK$268.6 million last year[41]. - Higher net interest expenses amounted to approximately HK$34.3 million, contributing to the profit decline[41]. - Preliminary operating loss from the new Vietnam factory was approximately HK$34.8 million[41]. - An impairment loss from the investment in Teejay was approximately HK$64.2 million, which significantly impacted overall profit[41]. - Excluding the impairment loss, profit would have decreased by approximately 26.6%[41]. - The Group's financial performance was adversely affected by macro-economic factors, including US-China tensions, global economic uncertainty, and fluctuating exchange rates[151]. - The financial year ending March 31, 2024, saw a drop in profit attributable to shareholders due to fierce competition and weak customer demand, alongside higher net interest expenses and preliminary operating losses from the new Vietnam factory[109]. Debt and Capital Structure - The Group's total debt as of March 31, 2024, was HK$1,490,542,000, an increase from HK$1,450,138,000 in 2023, reflecting a growth of approximately 2.4%[29]. - The gearing ratio increased to 50% in 2024 from 47% in 2023, suggesting a higher reliance on debt financing[29]. - The net debt position rose to HK$585.7 million as of March 31, 2024, from HK$99.4 million in 2023, primarily due to the acquisition of property, plant, and equipment for the second Vietnam production site[48]. - The debt to equity ratio rose to 87.6% in 2024 from 79.0% in 2023, reflecting an increase in leverage[54]. - The Group's current ratio decreased to 1.2 in 2024 from 1.5 in 2023, while the quick ratio fell to 0.8 from 1.0[54]. - The Group's cash and bank balances decreased to HK$894.9 million in 2024 from HK$1,347.5 million in 2023[48]. Capital Expenditure - Total capital expenditure surged by 178.0% to HK$1,012.9 million in 2024, up from HK$364.3 million in 2023, mainly attributed to the construction of the second Vietnam factory costing approximately HK$838.0 million[50]. - The Group incurred approximately HK$1,013 million in expenditures during the 2024 Financial Year primarily to expand production capacity, compared to HK$364 million in 2023[145]. Operational Efficiency - The Group continues to engage in the manufacturing and trading of high-quality cotton and synthetic knitted fabrics[41]. - The Group's three factories will cater to different customer needs, enhancing operational efficiency and cost-effectiveness through economies of scale[110]. - Management expects a rebound in sales and profitability in the Financial Year 2024/25, followed by a mid-term growth trajectory[83]. Management and Governance - Ms. Ling Chi Wo Teresa appointed as Independent Non-executive Director since March 1, 2023, bringing over 30 years of experience in business management[93]. - The company emphasizes the importance of strategic planning and management through its experienced board members[119]. - The leadership team is committed to achieving corporate goals through effective management and strategic initiatives[119]. - The Group continues to strengthen its governance structure with independent directors overseeing key committees[121]. Risks and Challenges - Short-term challenges include geopolitics, inflation, interest expenses, and customers' sourcing policies[83]. - The Group faces risks from changes in governmental policies and regulations, which may lead to increased production costs[158]. - Legal risks from non-executable contracts or adverse judgments may negatively impact the Group's operations or financial condition[156]. - The Group identified various risks and uncertainties for the 2024 Financial Year, which could affect its business and prospects[129]. Dividends and Shareholder Returns - The Board proposed a final dividend of HK5 cents per share for the 2024 Financial Year, totaling HK12 cents per share for the year, down from HK19 cents in 2023[109]. - An interim dividend of HK$0.07 per share was paid on December 20, 2023, compared to HK$0.15 per share in 2023, while a final dividend of HK$0.05 per share is proposed for 2024, up from HK$0.04 per share in 2023[158]. - The Board intends to maintain long-term returns for shareholders, considering various factors such as financial results and market conditions when proposing dividends[158]. Employee and Workforce - As of March 31, 2024, the Group employed 4,874 full-time employees, an increase from 4,484 in 2023[109]. Environmental and Social Responsibility - The Company’s subsidiary in Panyu received multiple awards for environmental achievements, including being graded as an Environmental Integrity Enterprise by Guangzhou Municipal Ecological Environment Bureau in May 2023[108]. - The Company developed innovative products during the year, receiving awards such as the "2023 Excellent Fabric (First Prize)" for a 3D fabric from China Dyeing and Printing Association in July 2023[108].

Financial Performance - The company's revenue for the fiscal year ending March 31, 2024, was HKD 4,665,165,000, a decrease from HKD 5,018,735,000 in the previous year, representing a decline of approximately 7%[33] - The net profit for the fiscal year was HKD 172,458,000, down from HKD 273,649,000 in the previous year, indicating a decrease of about 37%[33] - The basic earnings per share for the year were HKD 0.12, compared to HKD 0.19 in the previous year, reflecting a decline of 36.8%[20] - The total comprehensive income for the year was HKD 48,582,000, down from HKD 73,959,000, a decrease of approximately 34%[34] - Gross profit for the same period was HKD 423,592, down from HKD 489,987, resulting in a gross margin of 9.1%, compared to 9.8% in the previous year[45] - Net profit attributable to equity holders was HKD 167,118, down from HKD 268,572, reflecting a net profit margin of 3.6%, compared to 5.4% in the prior year[45] - The company reported a pre-tax profit of HKD 202,862,000 in 2024, down from HKD 317,196,000 in 2023, a decrease of approximately 36.00%[75] - Profit attributable to equity holders was approximately HKD 167.1 million, a decrease of 37.8% from HKD 268.6 million in 2023[92] Assets and Liabilities - Non-current assets increased to HKD 2,816,635,000 from HKD 2,296,109,000, representing a growth of about 22.6%[23] - Current assets decreased to HKD 2,749,336,000 from HKD 3,233,208,000, a decline of approximately 15%[23] - The company's total assets amounted to HKD 5,565,971,000, slightly up from HKD 5,529,317,000, indicating a marginal increase of 0.66%[23] - Total liabilities increased to HKD 2,599,517 from HKD 2,440,740, indicating a rise in the company's debt levels[45] - The net debt level as of March 31, 2024, was HKD 585.7 million, up from HKD 99.4 million in 2023, attributed to the ongoing construction of the second factory in Vietnam[100] Cash Flow and Liquidity - Cash and bank balances decreased to HKD 894,940 from HKD 1,347,493, indicating a significant reduction in liquidity[45] - The current ratio as of March 31, 2024, was 1.2, down from 1.5 in 2023, indicating a decrease in liquidity[103] - The company’s liquidity position is supported by cash and bank balances totaling HKD 894.9 million as of March 31, 2024, down from HKD 1,347.5 million in 2023[122] Shareholder Value and Dividends - The company plans to enhance shareholder value through share buybacks authorized at the annual general meetings held on August 11, 2022, and August 10, 2023[2] - The company proposed a final dividend of HKD 0.05 per share for the year ending March 31, 2024, compared to HKD 0.04 in 2023[82] - The company declared an interim dividend of HKD 0.07 per share for the six-month period ending September 30, 2023, compared to HKD 0.15 per share in 2023[107] Operational Efficiency - Operating expenses increased to HKD 237,487, up from HKD 203,193, leading to an operating expense ratio of 5.1%, compared to 4.0% in 2023[45] - Inventory turnover days improved to 86 days from 89 days, suggesting better inventory management[45] - Accounts receivable turnover days decreased to 61 days from 65 days, indicating a slight improvement in collection efficiency[45] Market Performance - Revenue from Vietnam significantly increased from HKD 811,215,000 in 2023 to HKD 1,493,673,000 in 2024, representing an increase of approximately 83.96%[51] - The group's revenue for the year was approximately HKD 4,665.2 million, a decrease of 7.0% from HKD 5,018.7 million in 2023, driven by a 2.1% increase in sales volume and an 8.9% decrease in average selling price[89] Employee and Operational Developments - Employee benefits expenses increased from HKD 575,059,000 in 2023 to HKD 602,823,000 in 2024, an increase of about 4.83%[54] - The company employed 4,874 full-time employees as of March 31, 2024, compared to 4,484 in 2023[130] - The company’s administrative expenses increased to HKD 194.3 million in 2024 from HKD 162.1 million in 2023, mainly due to pre-operating expenses related to the new factory in Vietnam[117] Future Outlook and Strategic Initiatives - Management anticipates a rebound in sales and profits for the fiscal year 2024/25, believing the company will enter a mid-term growth trajectory[161] - The company aims to stimulate demand through innovative product development and market penetration strategies despite ongoing geopolitical and inflationary challenges[135] - The new factory in Vietnam's Nam Dinh Province began trial production in April 2024 and is expected to be fully operational by the second half of the fiscal year ending March 31, 2025, enhancing overall capacity and product offerings[159] - The company has initiated a solar energy project at its Panyu factory to enhance renewable energy utilization, with plans to expand this initiative to the factory in Vietnam's Hai Duong Province[160] Corporate Governance - The company has established an audit committee to ensure compliance with corporate governance standards as per the listing rules[170] - The board will consider various factors, including financial performance and future funding needs, when deciding on dividend distributions[137] - The company will hold its annual general meeting on August 15, 2024[172]

Financial Performance - Total comprehensive loss for the period ended September 30, 2023, was HK$142,055,000, compared to a profit of HK$124,463,000 in the previous period[14]. - For the six months ended September 30, 2023, the company reported a total revenue of HK$11,942,000, compared to HK$3,116,000 for the same period in 2022, representing a significant increase of 283%[31]. - Profit attributable to equity holders of the Company was HK$124.5 million, a decrease of approximately 49.8% compared to HK$248.2 million for the same period in 2022[53]. - The decrease in profit was primarily due to a 16.9% drop in sales revenue, higher fixed costs per unit from lower production facility utilization, and an impairment loss of approximately HK$10.0 million from an investment in Teejay Lanka PLC[53]. - Profit for the period attributable to equity holders of the Company was HK$124,463,000, compared to HK$248,179,000, representing a decline of 50%[68]. - The company reported a profit for the period of HK$124,463,000, compared to a profit of HK$128,248,000 in the previous period, indicating a slight decrease of 2.2%[73]. Revenue and Sales - Revenue for the six months ended September 30, 2023, was HK$2,294,749,000, a decrease of 16.8% compared to HK$2,761,191 in the same period of 2022[143]. - Revenue from Vietnam increased to HK$1,246,914,000 compared to HK$811,215,000 as of March 31, 2023, reflecting a significant growth[172]. - The Group's total revenue for the period was HK$2,336,902,000, up from HK$1,960,608,000 for the previous period[172]. Expenses and Costs - The Group's cost of sales was HK$2,080.8 million, representing a decrease of approximately 14.4% from HK$2,432.0 million in the previous year, consistent with the revenue decline[53]. - Selling and distribution expenses slightly decreased to HK$19.0 million from HK$21.5 million in 2022[54]. - Administration expenses decreased to HK$82.8 million from HK$90.3 million in 2022[54]. - Finance costs increased by approximately 68.8% to HK$34.6 million from HK$20.5 million in 2022[54]. - General and administrative expenses decreased to HK$82,826,000 from HK$90,261,000, reflecting a reduction of approximately 8%[68]. Assets and Liabilities - Total assets as of 30 September 2023 were HK$5,375.2 million, a decrease of approximately 2.8% from HK$5,529.3 million on 31 March 2023[54]. - Current liabilities were HK$2,150.2 million and non-current liabilities were HK$221.7 million as of 30 September 2023[56]. - The company’s inventories rose from HK$964,821,000 to HK$990,101,000, an increase of about 2.6%[71]. - Total liabilities decreased from HK$2,440,740,000 to HK$2,371,936,000, indicating a reduction of approximately 2.8%[72]. Cash Flow and Financing - Cash and cash equivalents decreased from HK$1,187,110,000 to HK$808,782,000, a decline of approximately 31.8%[71]. - Net cash inflow from operating activities was HK$269,925,000, down from HK$421,961,000, reflecting a decrease of 36%[99]. - Net cash outflow from financing activities was HK$259,500,000, compared to an outflow of HK$67,554,000 in the same period last year, representing an increase in outflow of 284.5%[99]. Borrowings and Debt - As of September 30, 2023, the Group's bank borrowings amounted to HK$1,154,827,000, a decrease from HK$1,320,277,000 as of March 31, 2023, representing a reduction of approximately 12.5%[20]. - The Group's total borrowings secured by corporate guarantees provided by the Company were HK$676,104,000 as of September 30, 2023, down from HK$910,511,000 as of March 31, 2023, indicating a decrease of approximately 25.7%[28]. - The Group's borrowings included in current liabilities were HK$1,154,827,000 as of September 30, 2023, compared to HK$1,320,277,000 as of March 31, 2023, indicating a decrease of approximately 12.5%[20]. Investments and Capital Expenditure - Capital expenditure contracted but not yet incurred as of September 30, 2023, is HK$462,636,000, down 22.6% from HK$597,487,000 as of March 31, 2023[8]. - The Group's total capital expenditure increased by approximately 667.4% to HK$624.9 million from HK$81.4 million in 2022, mainly for the construction of a second factory in Vietnam[56]. Dividends and Share Capital - Dividends paid during the period amounted to HK$56,120,000, reflecting a reduction in cash outflow[14]. - The company declared an interim dividend of HK$0.07 per share for the six months ended September 30, 2023, down from HK$0.15 per share in 2022[33]. - The issued share capital of the company was reduced by the par value of the repurchased shares, which were subsequently cancelled on August 2, 2023[35]. Operational Highlights - The new factory in Vietnam is expected to reach a maximum production capacity of 34 million pounds per year in the first phase, with trial runs scheduled for January 2024 and full production anticipated in Q2 2024[62]. - The management expects a rebound in profitability in the financial year 2024/25 when the new Vietnam factory is in full production[62]. - The Group's existing factory in Vietnam is operating at close to full capacity, but its ability to take on further sales orders is limited by current design constraints[87]. Risk Management and Compliance - The Group's activities are exposed to various financial risks, including market risk, credit risk, and liquidity risk, with no changes in risk management policies since March 31, 2023[106][109]. - The interim financial information is prepared in accordance with Hong Kong Accounting Standard 34, ensuring compliance with relevant regulations[66].

[Interim Financial Information](index=1&type=section&id=Interim%20Financial%20Information) This section presents the condensed consolidated financial statements, including profit or loss, balance sheet, and detailed notes, for the interim period [Condensed Consolidated Statement of Profit or Loss](index=1&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended September 30, 2023, the Group reported a 16.9% revenue decline to HKD 2.29 billion and a 49.8% decrease in profit attributable to owners of the Company to HKD 124 million Performance Summary for the Six Months Ended September 30, 2023 | Metric | 2023 (HKD thousands) | 2022 (HKD thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 2,294,749 | 2,761,191 | -16.9% | | Gross Profit | 213,945 | 329,239 | -35.0% | | Operating Profit | 165,124 | 257,583 | -35.9% | | Profit for the Period | 128,248 | 248,901 | -48.5% | | Profit Attributable to Owners of the Company | 124,463 | 248,179 | -49.8% | | Basic Earnings Per Share (HKD) | 0.09 | 0.18 | -50.0% | [Condensed Consolidated Balance Sheet](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) As of September 30, 2023, the Group's total assets slightly decreased by 2.8% to HKD 5.38 billion, with total equity at HKD 3.00 billion and total liabilities at HKD 2.37 billion Balance Sheet Summary (September 30, 2023 vs March 31, 2023) | Metric | September 30, 2023 (HKD thousands) | March 31, 2023 (HKD thousands) | Change | | :--- | :--- | :--- | :--- | | Non-current Assets | 2,653,838 | 2,296,109 | +15.6% | | Current Assets | 2,721,353 | 3,233,208 | -15.8% | | **Total Assets** | **5,375,191** | **5,529,317** | **-2.8%** | | Current Liabilities | 2,150,187 | 2,190,965 | -1.9% | | Non-current Liabilities | 221,749 | 249,775 | -11.2% | | **Total Liabilities** | **2,371,936** | **2,440,740** | **-2.8%** | | **Total Equity** | **3,003,255** | **3,088,577** | **-2.8%** | [Notes to the Condensed Consolidated Interim Financial Information](index=5&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Information) These notes detail the basis of preparation, accounting policies, segment information, revenue and expense breakdown, EPS calculation, dividend policy, and balance sheet items, highlighting the Group's single operating segment, regional revenue distribution, an HKD 10 million impairment loss, and an interim dividend of HKD 0.07 per share - All of the Group's business operations are related to the manufacturing and trading of textile products, managed and reviewed as a single operating segment[17](index=17&type=chunk) - The Board declared an interim dividend of **HKD 0.07 per share**, a significant decrease from **HKD 0.15 per share** in the prior period[26](index=26&type=chunk)[49](index=49&type=chunk) - An impairment loss of **HKD 10 million** was recognized on the investment in associate Teejay Lanka PLC, as its recoverable amount was below carrying value[51](index=51&type=chunk)[27](index=27&type=chunk) Revenue by Geographical Region (For the Six Months Ended September 30) | Region | 2023 (HKD thousands) | 2022 (HKD thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Southeast Asia | 1,255,195 | 1,508,351 | -16.8% | | China | 607,578 | 659,558 | -7.9% | | Bangladesh | 141,583 | 180,343 | -21.5% | | Sri Lanka | 81,153 | 130,575 | -37.9% | | Hong Kong | 86,440 | 105,935 | -18.4% | | Others | 122,800 | 176,429 | -30.4% | | **Total** | **2,294,749** | **2,761,191** | **-16.9%** | [Management Discussion and Analysis](index=13&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the Group's business and financial performance, liquidity, financial resources, capital structure, and future outlook [Business and Financial Review](index=13&type=section&id=Business%20and%20Financial%20Review) During the review period, the Group faced challenging financial performance with revenue declining by 16.9% due to lower sales volume and average selling prices, and profit attributable to owners of the Company significantly decreasing by 49.8% to HKD 124.5 million - Revenue decreased by **16.9%** to **HKD 2.295 billion**, resulting from a **7.4%** decline in sales volume and a **10.3%** decrease in average selling price[32](index=32&type=chunk) - Profit attributable to owners of the Company decreased by **49.8%** to **HKD 124.5 million**; excluding the **HKD 10 million** impairment loss, profit still declined by **45.8%**[33](index=33&type=chunk)[34](index=34&type=chunk) Key Financial Ratios (For the Six Months Ended September 30) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Gross Profit Margin | 9.3% | 11.9% | | Return on Equity | 4.3% | 7.8% | | Interest Coverage Ratio | 5.5 times | 19.5 times | [Liquidity, Financial Resources and Capital Structure](index=15&type=section&id=Liquidity,%20Financial%20Resources%20and%20Capital%20Structure) The Group maintained prudent financial management, with net debt increasing to HKD 466 million due to higher capital expenditure of HKD 625 million for new factory construction, while the debt-to-equity ratio remained at 79.0% - Total capital expenditure significantly increased by **667.4%** year-over-year to **HKD 625 million**, primarily for the construction of the second factory in Vietnam[87](index=87&type=chunk) - Net debt increased from **HKD 99.4 million** to **HKD 465.5 million**, mainly due to advance payments for the new factory construction in Vietnam[86](index=86&type=chunk) Key Liquidity Ratios | Metric | September 30, 2023 | March 31, 2023 | | :--- | :--- | :--- | | Current Ratio | 1.3 | 1.5 | | Quick Ratio | 0.8 | 1.0 | | Gearing Ratio | 42.8% | 47.0% | | Debt-to-equity Ratio | 79.0% | 79.0% | [Prospects and Outlook](index=17&type=section&id=Prospects%20and%20Outlook) Management anticipates an uncertain short-term economic outlook but remains optimistic about medium-term growth, implementing strategies like sales team enhancement and production optimization, with the new Vietnam plant expected to boost capacity and profitability upon full operation in Q2 2024 - Construction of the new Vietnam plant is progressing well, with trial production scheduled for **January 2024** and full operation by **Q2 2024**, reaching a maximum annual production capacity of **34 million pounds** in its first phase[98](index=98&type=chunk) - Despite short-term economic uncertainties influenced by geopolitics, interest rates, and slowing growth in key markets, management remains optimistic about the Group's medium-term growth and expects profitability to rebound in the **2024/25 fiscal year**[124](index=124&type=chunk) - To enhance competitiveness, the Group is implementing several measures, including strengthening the sales team, developing new product lines to expand into the China market, and optimizing production processes and cost management[122](index=122&type=chunk)[97](index=97&type=chunk) [Corporate Governance and Other Information](index=18&type=section&id=Corporate%20Governance%20and%20Other%20Information) This section covers the Group's dividend policy, share repurchase activities, and adherence to corporate governance principles [Dividends and Share Repurchase](index=18&type=section&id=Dividends%20and%20Share%20Repurchase) The Board declared an interim dividend of HKD 0.07 per share payable on December 20, 2023, and the company repurchased 5,513,000 shares for approximately HKD 10.45 million to enhance net asset value and earnings per share - An interim dividend of **HKD 0.07 per share** was declared for the six months ended September 30, 2023[99](index=99&type=chunk) Share Repurchase Details (For the Six Months Ended September 30, 2023) | Month of Repurchase | Number of Shares Repurchased | Highest Price Per Share (HKD) | Lowest Price Per Share (HKD) | Total Consideration (HKD) | | :--- | :--- | :--- | :--- | :--- | | June 2023 | 800,000 | 1.94 | 1.85 | 1,505,500 | | July 2023 | 4,713,000 | 1.97 | 1.78 | 8,942,700 | [Corporate Governance](index=19&type=section&id=Corporate%20Governance) The company largely complied with the Corporate Governance Code, with the only deviation being the combined roles of Chairman and CEO, a structure the Board believes maintains adequate checks and balances, and the Audit Committee has reviewed the interim results - The company complied with the Corporate Governance Code under the Listing Rules, with a deviation where the roles of Chairman and Chief Executive Officer are combined[128](index=128&type=chunk)[101](index=101&type=chunk) - The company has established an Audit Committee, comprising four independent non-executive directors, responsible for overseeing financial reporting and internal control systems, and has reviewed these interim results[104](index=104&type=chunk)[130](index=130&type=chunk)

Financial Performance - The Group's revenue for the fiscal year was approximately HK$5,018.7 million, a decrease of 17.3% compared to HK$6,066.3 million in 2022, driven by a 24.5% drop in sales volume and a 9.6% increase in average sales price[41]. - Profit attributable to equity holders was approximately HK$268.6 million, representing a decrease of 53.1% from HK$572.7 million in 2022, primarily due to lower sales revenue and higher fixed cost absorption[41]. - For the year ended 31 March 2023, the Group's gross profit margin decreased to 9.8% from 12.8% in 2022[27]. - The return on equity for the year ended 31 March 2023 was 8.9%, down from 16.9% in 2022[27]. - The Group's total cash and bank balances as of 31 March 2023 were HK$1,347.5 million, a decrease from HK$1,545.1 million in 2022[28]. - The Group's distributable reserves as of March 31, 2023, amounted to approximately HK$1,939 million, a decrease from HK$2,346 million in 2022[134]. - The average effective tax rate increased to approximately 13.7%, up from 10.3% in 2022, attributed to non-deductible exchange losses[45]. Assets and Liabilities - The Group's total assets as of March 31, 2023, amounted to HKD 5,529.3 million, a decrease of approximately 7.0% from HKD 5,944.2 million in 2022[26]. - Non-current assets totaled HKD 2,296.1 million as of March 31, 2023, compared to HKD 2,124.4 million in 2022[26]. - Current assets were reported at HKD 3,233.2 million as of March 31, 2023, down from HKD 3,819.8 million in 2022[26]. - As of 31 March 2023, the Group's net debt position increased to HK$99.4 million compared to HK$34.8 million in 2022[28]. - The Group had bank loans of HK$1,320.3 million as of 31 March 2023, down from HK$1,453.7 million in 2022[28]. - The Gearing Ratio increased to 47.0% in 2023 from 46.6% in 2022, and the Debt to Equity Ratio rose from 73.3% to 79.0%[54]. Operational Developments - The Group is expecting the opening of a new factory in Vietnam soon, which is anticipated to enhance production capacity and provide favorable opportunities for business growth[16]. - Capital expenditure increased by 198.3% to HK$364.3 million, primarily for the construction of a second factory in Vietnam and environmental projects[52]. - The management expects a substantial growth in capacity to fulfill customer orders with the completion of the new factory in Vietnam by the end of the financial year 2023/24[88]. - The Group is actively expanding its domestic customer base, particularly in sportswear and high-quality synthetic fabrics[88]. Shareholder Information - The Board proposed a final dividend of HK4 cents per share for the 2023 Financial Year, down from HK14 cents in 2022, resulting in a total dividend of HK19 cents per share compared to HK35 cents in 2022[62]. - The Group's issued share capital includes significant holdings by various beneficial owners, with Fidelity Funds holding approximately 5.01%[1]. - A total of 2,687,000 shares were repurchased on the Stock Exchange at an aggregate consideration of HK$7,339,040, with the shares subsequently cancelled on 8 November 2022[111]. Management and Governance - The appointment of Ms. Ling Chi Wo Teresa as an Independent Non-executive Director is expected to enhance board diversity and bring new insights to the Group[15]. - The Group's management team includes experienced professionals with extensive backgrounds in textiles and engineering[99]. - Mr. Masaru Okutomi was appointed as Chairman and CEO of the Group on October 1, 2021, after serving as Vice Chairman since July 1, 2019[119]. - The Group's management team includes professionals with diverse backgrounds in finance, human resources, and procurement management, enhancing operational efficiency[126]. Market and Strategic Outlook - The financial year ended March 31, 2023, faced stagnant demand and fierce competition, with production costs rising but not fully reflected in sales prices[62]. - The management anticipates a rise in domestic consumption and demand for fabric with the economic recovery in mainland China[66]. - The Group aims to expand its customer base and explore new markets by launching innovative functional products and promoting sustainable textiles[41]. - The Group has established long-term relationships with strategic partners, including Toray, to support its global market penetration efforts[41]. Environmental and Social Responsibility - The Group has been recognized for its environmental efforts, receiving multiple awards for excellence in environmental protection[58][60]. - The total capital expenditure for environmental protection projects reflects the Group's commitment to sustainability[76]. - The Group is committed to exploring low-emission measures to support customers aiming for carbon neutrality by 2050[89].