致：香港交易及結算所有限公司 公司名稱: 南旋控股有限公司 呈交日期: 2025年8月6日 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | | 於香港聯交所上市 (註1) | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01982 | 說明 | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | 法定/註冊股本 | | | 上月底結存 | | | 5,000,000,000 | HKD | | 0.01 HKD | | 50,000,000 | | 增加 / 減少 (-) | | | 0 | | | HKD | | 0 | | 本月底結存 | | | 5,000,000,000 | HKD | | 0.01 HKD | | 50,000,000 | 股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 | | | 本月底法定/註冊股本總額： HKD 50,000,000 FF301 第 1 頁 共 10 ...

(Incorporated in the Cayman Islands with limited liability) （於開曼群島註冊成立的有限公司） (Stock Code 股份代號: 1982) N O T I F I C AT I O N L E T T E R 通 知 信 函 Dear non-registered shareholder(s), Nameson Holdings Limited (the "Company") - Notice of Publication of 2024-2025 Annual Report and Environmental, Social and Governance Report (the "Current Corporate Communication") The Current Corporate Communication of the Company has been published in English and Chinese languages and are available on the website of The Stock Exc ...

(Incorporated in the Cayman Islands with limited liability) （於開曼群島註冊成立的有限公司） (Stock Code 股份代號: 1982) N O T I F I C AT I O N L E T T E R 通 知 信 函 Dear registered shareholder(s), Nameson Holdings Limited (the "Company") - Notice of Publication of 2024-2025 Annual Report and Environmental, Social and Governance Report (the "Current Corporate Communication") The Current Corporate Communication of the Company has been published in English and Chinese languages and are available on the website of The Stock Exchang ...

1 南旋控股有限公司 2025年環境、社會及管治報告 目錄 | 給持份者的話 | | 2 | | --- | --- | --- | | 關於本報告 | | 3 | | 關於本集團 | | 4 | | 管治架構 | | 5 | | 南旋重要性議題 | | 6 | | 我們的可持續發展支柱 — HEART | | 8 | | 匠心工藝 | | 10 | | 賦能工作間 | | 20 | | 倡導守護大自然 | | 33 | | 擁有營運的韌性 | 59 | | | 持續貢獻社區 | | 65 | | 強弱危機分析 | | 71 | | 展望未來 | | 72 | | 附錄一：可持續發展認可及專業會員資格 | | 73 | | 附錄二：適用法律法規 | | 75 | | 附錄三：報告準則 | | 79 | | 附錄四：香港交易所ESG報告守則內容索引 | | 80 | | 附錄五：GRI內容索引 | | 90 | 南旋控股有限公司 2025年環境、社會及管治報告 2 給持份者的話 截至2025年3月31日止財政年度，本集團欣然分享我們在環境、社會及管治（「ESG」）舉措方面所取得的成果。該等里程碑 不僅突出我們恪 ...

[Company Information](index=4&type=section&id=Company%20Information) [Company Overview](index=4&type=section&id=Company%20Overview) This section outlines Novelty Asia Holdings Limited's fundamental corporate details, including its board, key personnel, and operational contacts - The company's Board of Directors comprises **four executive directors** and **four independent non-executive directors**, with Mr. Wong Wai Yu as Chairman and Mr. Man Yu Hin as Chief Executive Officer[6](index=6&type=chunk) - PricewaterhouseCoopers is the company's auditor[8](index=8&type=chunk) [Chairman's Statement](index=6&type=section&id=Chairman%27s%20Statement) [Chairman's Statement](index=6&type=section&id=Chairman%27s%20Statement) The Chairman's Statement reviews the 2025 fiscal year, highlighting the Group's business resilience, stable core knitting operations, growing contributions from diversified segments, and strategic expansion in Vietnam | Indicator | FY2025 (million HKD) | Change | | :--- | :--- | :--- | | **Total Revenue** | 4,352.1 | -0.6% | | **Gross Profit** | 781.8 | +1.0% | | **Gross Profit Margin** | 18.0% | +0.3pp | | **Operating Profit** | 449.9 | -3.8% | | **Profit for the Year** | 355.4 | -6.6% | - Sales volume of men's and women's knitwear decreased by **9.6% to 29.1 million pieces** due to delayed seasonal shifts, but revenue only slightly declined by **4.2%** due to increased average selling prices from cashmere sweater orders[14](index=14&type=chunk) - Business diversification strategy shows initial success with stable cashmere yarn sales and significant improvement in fabric business, contributing increasingly to Group revenue[13](index=13&type=chunk) - To address order shifts from mainland China, the Group strategically expanded its production capacity in Vietnam, leveraging cost advantages and robust infrastructure to establish it as a key production base[12](index=12&type=chunk)[17](index=17&type=chunk) - The Board declared a second interim dividend of **1.5 HK cents per share**, bringing the full-year dividend payout ratio to **75%** including the first interim dividend of **9.8 HK cents per share**[15](index=15&type=chunk) [Management Discussion and Analysis](index=10&type=section&id=Management%20Discussion%20and%20Analysis) [Financial Review](index=11&type=section&id=Financial%20Review) This fiscal year's financial review highlights a slight revenue decrease, improved gross profit margin driven by fabric business, and a decline in profit attributable to owners due to reduced other income and increased administrative expenses | Financial Indicator (Year ended March 31) | 2025 (thousand HKD) | 2024 (thousand HKD) | Change | | :--- | :--- | :--- | :--- | | **Revenue** | 4,352,130 | 4,378,888 | -0.6% | | **Gross Profit** | 781,815 | 774,239 | +1.0% | | **Gross Profit Margin** | 18.0% | 17.7% | +0.3pp | | **Operating Profit** | 449,910 | 467,497 | -3.8% | | **Profit for the Year Attributable to Owners of the Company** | 342,327 | 361,672 | -5.4% | | **Adjusted Net Profit** | 342,753 | 396,471 | -13.5% | - Sales volume of men's and women's knitwear decreased from **32.2 million pieces to 29.1 million pieces**, partially offset by an increase in average selling price from **HKD 109.1 to HKD 115.6**[23](index=23&type=chunk) - Net other income significantly decreased from **HKD 78.2 million to HKD 41.2 million**, primarily due to a **HKD 21.0 million** reduction in exchange gains and a **HKD 16.4 million** decrease in gains from disposal of property, plant, and equipment[27](index=27&type=chunk) - No impairment loss was recorded for the Myanmar production base in FY2025, compared to an impairment loss of **HKD 34.0 million** in FY2024[30](index=30&type=chunk) [Consolidated Cash Flow Statement Analysis](index=16&type=section&id=Consolidated%20Cash%20Flow%20Statement%20Analysis) This fiscal year saw a net decrease in cash and cash equivalents, primarily driven by a significant reduction in net cash from operating activities due to increased inventory, and expanded net cash outflows from investing and financing activities | Cash Flow Item (Year ended March 31) | 2025 (thousand HKD) | 2024 (thousand HKD) | | :--- | :--- | :--- | | **Net Cash Generated from Operating Activities** | 222,940 | 582,949 | | **Net Cash Used in Investing Activities** | (238,307) | (145,057) | | **Net Cash Used in Financing Activities** | (272,114) | (435,922) | | **Cash and Cash Equivalents at Year End** | 430,818 | 717,404 | - Net cash from operating activities significantly decreased, primarily due to a **HKD 280.1 million** increase in inventories[40](index=40&type=chunk) [Liquidity, Financial Resources and Risk Management](index=17&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Risk%20Management) The Group's gearing ratio significantly increased, with cash and cash equivalents primarily denominated in USD and RMB, while comprehensive policies are in place to manage foreign currency, interest rate, credit, and liquidity risks - The gearing ratio (net debt/total capital) increased from **8.9%** as of March 31, 2024, to **20.1%** as of March 31, 2025[44](index=44&type=chunk) - As of March 31, 2025, total bank borrowings and lease liabilities amounted to **HKD 1,095.1 million**, with **80.4%** denominated in HKD[45](index=45&type=chunk) - The Group's foreign currency exposure primarily stems from RMB (operating expenses) and USD (sales revenue), with USD risk considered minimal due to the HKD peg, while RMB-USD exchange rate risk is closely monitored[47](index=47&type=chunk) - To mitigate interest rate risk, the Group entered into HKD interest rate swap contracts during the year[48](index=48&type=chunk) [Capital Expenditure and Human Resources](index=18&type=section&id=Capital%20Expenditure%20and%20Human%20Resources) This fiscal year, the Group incurred significant capital expenditure primarily for new production facilities in Vietnam and machinery, while maintaining a substantial global workforce with associated annual employee costs - Capital expenditure amounted to approximately **HKD 466.9 million**, primarily for the new production base in Vietnam and machinery procurement[51](index=51&type=chunk) - As of March 31, 2025, the Group's capital commitments were approximately **HKD 157.1 million**[52](index=52&type=chunk) - As of March 31, 2025, the Group employed approximately **15,400 full-time staff**, with total annual employee costs (including directors' emoluments) of **HKD 1,023.9 million**[60](index=60&type=chunk) [Biographies of Directors and Senior Management](index=20&type=section&id=Biographies%20of%20Directors%20and%20Senior%20Management) [Biographies of Directors and Senior Management](index=20&type=section&id=Biographies%20of%20Directors%20and%20Senior%20Management) This section details the personal biographies of the company's executive directors, independent non-executive directors, and senior management, covering their roles, responsibilities, and professional backgrounds - The executive director team includes Chairman Mr. Wong Wai Yu, CEO Mr. Man Yu Hin, Chief Production Officer Mr. Wong Ting Chun, and Chief Operating Officer Mr. Li Po Sing, overseeing corporate strategy, daily operations, production, and knitwear business respectively[63](index=63&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk) - The independent non-executive director team comprises Ms. Fanny Law Fan Chiu Fun, Mr. Kan Chung Shun, Mr. Fan Chun Wah Andrew, and Mr. Yip Shue Kwong, possessing extensive experience in public administration, law, accounting, and finance[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk)[71](index=71&type=chunk) - Senior management includes Chief Financial Officer and Company Secretary Mr. To Chi Keung, responsible for key functions such as financial planning, reporting, and risk management[73](index=73&type=chunk) [Corporate Governance Report](index=25&type=section&id=Corporate%20Governance%20Report) [Corporate Governance Practices and the Board](index=25&type=section&id=Corporate%20Governance%20Practices%20and%20the%20Board) The company maintains high corporate governance standards, complying with all mandatory code provisions, with a diverse Board of Directors comprising executive and independent non-executive members, ensuring separation of Chairman and CEO roles, and achieving full attendance at all board meetings - The company confirmed compliance with all mandatory code provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules for the year ended March 31, 2025[76](index=76&type=chunk) - The Board comprises **4 executive directors and 4 independent non-executive directors**, meeting the Listing Rules' requirement for at least one-third independent non-executive directors[81](index=81&type=chunk)[83](index=83&type=chunk) - The roles of Chairman (Mr. Wong Wai Yu) and Chief Executive Officer (Mr. Man Yu Hin) are separate with clear responsibilities[93](index=93&type=chunk) - Four Board meetings were held during the reporting year, with **100% attendance** from all directors[91](index=91&type=chunk)[92](index=92&type=chunk) [Board Committees](index=31&type=section&id=Board%20Committees) This section outlines the responsibilities, composition, and annual work of the Executive, Audit, Remuneration, and Nomination Committees, highlighting their roles in financial oversight, remuneration policy, and board structure - The Audit Committee consists of **three independent non-executive directors**, chaired by Mr. Fan Chun Wah Andrew, who possesses accounting qualifications, and held **two meetings** during the year[95](index=95&type=chunk)[96](index=96&type=chunk) - The Remuneration Committee comprises **one executive director and two independent non-executive directors**, held **one meeting** during the year, and reviewed directors' and senior management's remuneration[97](index=97&type=chunk)[98](index=98&type=chunk) - The Nomination Committee consists of **one executive director and two independent non-executive directors**, held **one meeting** during the year, and reviewed the Board's structure, size, and composition[99](index=99&type=chunk)[101](index=101&type=chunk) - In FY2025, audit service fees paid to external auditor PricewaterhouseCoopers amounted to **HKD 2.3 million**, and non-audit service fees were **HKD 0.6 million**[102](index=102&type=chunk) [Internal Control and Risk Management](index=36&type=section&id=Internal%20Control%20and%20Risk%20Management) The Group employs a 'three lines of defense' risk governance framework, with internal controls based on the COSO framework, and the Board has reviewed its effectiveness in managing significant risks such as global trade, geopolitical events, raw material prices, supply chain, customer concentration, and compliance - The Group's risk governance framework is guided by the 'three lines of defense' model, with internal control systems developed in reference to the COSO framework[116](index=116&type=chunk)[117](index=117&type=chunk) - The Board confirmed that it reviewed the risk management and internal control systems for the current fiscal year and deemed them adequate and effective[129](index=129&type=chunk)[135](index=135&type=chunk) - Key risks faced by the Group include volatile global trade conditions, geopolitical impacts, fluctuating raw material prices (e.g., cashmere), supply chain instability, high customer concentration, and multi-jurisdictional legal and regulatory compliance risks[130](index=130&type=chunk)[131](index=131&type=chunk)[132](index=132&type=chunk)[133](index=133&type=chunk) [Directors' Report](index=43&type=section&id=Directors%27%20Report) [Business and Financial Overview](index=43&type=section&id=Business%20and%20Financial%20Overview) This section provides an overview of the Group's stable knitwear manufacturing business, FY2025 performance, dividend distribution, charitable contributions, and distributable reserves - The Group's principal business is knitwear manufacturing, with no significant changes during the year[147](index=147&type=chunk) - The Board declared a second interim dividend of **1.5 HK cents per share**, bringing the total full-year dividend to **11.3 HK cents** including the interim dividend of **9.8 HK cents** already paid[149](index=149&type=chunk) - As of March 31, 2025, the company's distributable reserves were approximately **HKD 2,148.6 million**[151](index=151&type=chunk) - High concentration of major customers and suppliers: the top five customers accounted for **68.9%** of sales, and the top five suppliers accounted for **68.5%** of purchases[157](index=157&type=chunk) [Connected Transactions](index=46&type=section&id=Connected%20Transactions) This section discloses the Group's non-exempt continuing connected transactions during the reporting period, including a significant raw material procurement agreement, a joint venture for cashmere yarn production in Vietnam, and property lease renewals, all in compliance with Listing Rules - A raw material procurement agreement was entered into with connected person Hebei Yuteng Cashmere Products Co., Ltd., with an annual cap of **RMB 710 million** for the year ended March 31, 2025[166](index=166&type=chunk) - A joint venture agreement was entered into with Hebei Yuteng for cashmere yarn production in Vietnam, requiring a **USD 4.4 million** capital injection from the company's subsidiary Nan Guan (representing **55% equity interest**)[171](index=171&type=chunk) - The independent non-executive directors and auditor have reviewed these continuing connected transactions, confirming they were conducted on normal commercial terms and are in the overall interest of shareholders[167](index=167&type=chunk) [Directors' and Shareholders' Interests](index=48&type=section&id=Directors%27%20and%20Shareholders%27%20Interests) This section discloses the interests of directors, chief executives, and substantial shareholders in the company's shares as of March 31, 2025, details the outstanding share option scheme, and confirms the full utilization of IPO net proceeds - The controlling shareholder (Novelty Asia Investment Limited, controlled by Ting Wai Trust) holds **1,500,000,000 shares**, representing approximately **65.81%** of the issued share capital[198](index=198&type=chunk) Share Option Scheme Status (As of March 31, 2025) | Share Option Scheme Status (As of March 31, 2025) | Quantity | | :--- | :--- | | **Balance at Beginning of Year** | 48,538,000 | | **Granted During Year** | 0 | | **Exercised During Year** | 0 | | **Cancelled During Year** | (1,032,000) | | **Balance at End of Year** | 47,506,000 | - Net proceeds from the initial public offering of approximately **HKD 635.4 million** have been fully utilized, with the last portion allocated to the construction and equipment procurement for the Dak Lak factory in Vietnam[202](index=202&type=chunk)[203](index=203&type=chunk) [Environmental, Social and Governance (ESG)](index=57&type=section&id=Environmental%2C%20Social%20and%20Governance%20%28ESG%29) This section outlines the Group's policies and practices across environmental protection, compliance, workplace quality, health and safety, employee development, and stakeholder relations, confirming no material non-compliance issues during the year - The Group is committed to implementing environmental policies, complying with environmental laws and regulations in its factory locations, and minimizing environmental impact[213](index=213&type=chunk) - The Board confirmed that for the year ended March 31, 2025, it was unaware of any material non-compliance or breaches that would significantly impact the Group's operations[214](index=214&type=chunk) - The Group values its employees, offering competitive remuneration, on-the-job training, equal promotion opportunities, and a safe and healthy working environment[215](index=215&type=chunk)[216](index=216&type=chunk)[217](index=217&type=chunk) [Independent Auditor's Report](index=59&type=section&id=Independent%20Auditor%27s%20Report) [Independent Auditor's Report](index=59&type=section&id=Independent%20Auditor%27s%20Report) PricewaterhouseCoopers issued an unmodified opinion on the Group's consolidated financial statements for the year ended March 31, 2025, affirming their fair presentation and compliance with disclosure requirements, with 'Tax Provisions' highlighted as a key audit matter due to complex cross-jurisdictional judgments - Auditor PricewaterhouseCoopers issued an **unmodified opinion** (Clean Opinion) on the consolidated financial statements[222](index=222&type=chunk) - A key audit matter is 'Tax Provisions,' noted due to the Group's multi-jurisdictional operations in Hong Kong, mainland China, and Vietnam, involving complex cross-border arrangements and diverse tax regulations requiring significant management judgment and estimation[228](index=228&type=chunk) [Consolidated Financial Statements](index=65&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Profit or Loss](index=65&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) This fiscal year, the Group reported a slight decrease in revenue, with gross profit at HKD 781.8 million and a profit for the year of HKD 355.4 million, resulting in basic earnings per share of 15.02 HK cents | Item (Year ended March 31) | 2025 (thousand HKD) | 2024 (thousand HKD) | | :--- | :--- | :--- | | **Revenue** | 4,352,130 | 4,378,888 | | **Gross Profit** | 781,815 | 774,239 | | **Operating Profit** | 449,910 | 467,497 | | **Profit for the Year** | 355,414 | 380,704 | | **Profit for the Year Attributable to Owners of the Company** | 342,327 | 361,672 | | **Basic Earnings Per Share (HK cents)** | 15.02 | 15.87 | [Consolidated Statement of Financial Position](index=67&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, the Group's total assets stood at HKD 4,778.6 million, with total liabilities of HKD 2,140.9 million, resulting in total equity of HKD 2,637.7 million and net current assets of HKD 814.6 million | Item (As of March 31) | 2025 (thousand HKD) | 2024 (thousand HKD) | | :--- | :--- | :--- | | **Total Assets** | 4,778,595 | 4,448,103 | | **Total Liabilities** | 2,140,890 | 1,849,144 | | **Total Equity** | 2,637,705 | 2,598,959 | | **Non-current Assets** | 2,550,769 | 2,399,172 | | **Current Assets** | 2,227,826 | 2,048,931 | | **Net Current Assets** | 814,592 | 787,853 | [Consolidated Statement of Cash Flows](index=70&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) This fiscal year, net cash generated from operating activities significantly decreased, while net cash outflows from investing and financing activities led to a net reduction in cash and cash equivalents, ending the period at HKD 430.8 million | Item (Year ended March 31) | 2025 (thousand HKD) | 2024 (thousand HKD) | | :--- | :--- | :--- | | **Net Cash Generated from Operating Activities** | 222,940 | 582,949 | | **Net Cash Used in Investing Activities** | (238,307) | (145,057) | | **Net Cash Used in Financing Activities** | (272,114) | (435,922) | | **Net Decrease in Cash and Cash Equivalents** | (287,481) | 1,970 | | **Cash and Cash Equivalents at Year End** | 430,818 | 717,404 | [Notes to the Consolidated Financial Statements](index=71&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) This section provides detailed explanations and supplementary information to the consolidated financial statements, covering accounting policies, key estimates, segment information, asset/liability details, related party transactions, capital commitments, and financial instrument risk management [Financial Summary](index=136&type=section&id=Financial%20Summary) [Five-Year Financial Summary](index=136&type=section&id=Five-Year%20Financial%20Summary) This section provides a summary of the Group's key performance and financial position data for the past five fiscal years, showing stable revenue around HKD 4 billion and a recovery in profit attributable to owners after a FY2023 low Results (Year ended March 31) | Results (Year ended March 31) | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenue (thousand HKD)** | 4,352,130 | 4,378,888 | 4,602,307 | 4,040,472 | 3,848,554 | | **Profit for the Year Attributable to Owners of the Company (thousand HKD)** | 342,327 | 361,672 | 134,844 | 263,302 | 313,677 | Assets and Liabilities (As of March 31) | Assets and Liabilities (As of March 31) | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Assets (thousand HKD)** | 4,778,595 | 4,448,103 | 4,429,101 | 4,814,257 | 4,655,610 | | **Total Equity (thousand HKD)** | 2,637,705 | 2,598,959 | 2,477,674 | 2,602,894 | 2,416,135 | | **Total Liabilities (thousand HKD)** | 2,140,890 | 1,849,144 | 1,951,427 | 2,211,363 | 2,239,475 |

Core Viewpoint - The report from West Cow Securities maintains a cautiously optimistic outlook on Business Travel Holdings (01982), highlighting a slight decline in revenue for the fiscal year 2024/25 but an improvement in gross margin [1] Group 1: Financial Performance - Revenue for the fiscal year 2024/25 is projected to decrease by 0.6% year-on-year, with gross margin slightly improving to 18.0% [1] - Net profit is expected to decline by 6.6% due to increased fixed asset disposal losses and rising personnel costs, despite the absence of negative impacts from impairment losses [1] - The company announced a dividend of HKD 0.015 per share for the second half of the year, with a payout ratio of approximately 75% for the fiscal year [1] Group 2: Product Sales - Sales volume for traditional knitted products and fully-fashioned products decreased to 22 million pieces and 4.7 million pieces, respectively, leading to a revenue decline of approximately 4.2% for knitted products [1] - The unusually warm winter climate contributed to a significant drop in sales, although growth in cashmere products somewhat alleviated the overall decline [1] - The overall order level remains stable, with expectations that total sales for the fiscal year will remain flat year-on-year [1] Group 3: Future Growth Potential - New cashmere yarn production capacity is expected to come online in 2026, with external sales of cashmere yarn achieving a 0.4% year-on-year growth, reaching approximately HKD 580 million [1] - The cashmere yarn factory in Hebei is operating at full capacity, with an anticipated annual capacity increase of 300 to 400 tons in 2026, expected to drive revenue growth for the company [1] Group 4: Business Outlook - The fabric business has shown significant improvement, with losses substantially reduced, and is expected to reach breakeven next year due to increased utilization and sales growth [2] - Despite rising inventory levels primarily due to increased raw material stock for cashmere yarn, the impact on the company is considered limited [2] - Macroeconomic uncertainties remain, particularly regarding international tariffs, which could adversely affect sales and profit margins, although the company believes it can reach reasonable solutions with partners in the long term [2]

[Results Announcement Summary](index=1&type=section&id=Results%20Announcement%20Summary) [Financial Summary and Highlights](index=1&type=section&id=Financial%20Summary) For FY2025, total revenue slightly decreased by 0.6% to HKD 4.35 billion, while gross profit increased by 1.0% to HKD 780 million, with gross margin improving to 18.0%; however, profit attributable to owners decreased by 5.4% to HKD 340 million, and adjusted net profit declined by 13.5% to HKD 340 million Financial Performance Summary | Metric | FY2025 (HKD Million) | FY2024 (HKD Million) | Change | | :--- | :--- | :--- | :--- | | Revenue | 4,352.1 | 4,378.9 | -0.6% | | Gross Profit | 781.8 | 774.2 | +1.0% | | Gross Margin | 18.0% | 17.7% | +0.3 percentage points | | Net Profit | 355.4 | 380.7 | -6.6% | | Profit Attributable to Owners | 342.3 | 361.7 | -5.4% | | Adjusted Net Profit | 342.8 | 396.5 | -13.5% | | Adjusted Net Profit Margin | 7.9% | 9.1% | -1.2 percentage points | | Basic Earnings Per Share | 15.02 HK Cents | 15.87 HK Cents | -5.4% | - Adjusted net profit is a **non-HKFRS measure**, excluding **impairment loss on Myanmar production base** and **loss from derivative financial instruments**, aiming to better reflect **core operating performance**[3](index=3&type=chunk) [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Income Statement](index=2&type=section&id=Consolidated%20Income%20Statement) In FY2025, revenue slightly decreased by 0.6% to HKD 4.35 billion, while gross profit increased by 1.0% to HKD 780 million; due to a significant reduction in net other income and increased administrative expenses, operating profit decreased by 3.8% to HKD 450 million, with profit for the year ultimately declining by 6.6% to HKD 355 million Consolidated Income Statement Summary | Item (HKD Thousand) | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 4,352,130 | 4,378,888 | | Gross Profit | 781,815 | 774,239 | | Operating Profit | 449,910 | 467,497 | | Profit Before Income Tax | 407,880 | 433,905 | | Profit for the Year | 355,414 | 380,704 | | Profit Attributable to Owners of the Company | 342,327 | 361,672 | - No impairment loss on the Myanmar production base was recorded in FY2025, compared to a loss of **HKD 34.01 million** in FY2024[4](index=4&type=chunk) [Consolidated Statement of Comprehensive Income](index=3&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) In FY2025, other comprehensive loss for the year increased from HKD 29.2 million to HKD 50.89 million due to expanded losses from currency translation differences, resulting in a 13.4% year-on-year decrease in total comprehensive income for the year, from HKD 352 million to HKD 305 million Consolidated Statement of Comprehensive Income Summary | Item (HKD Thousand) | 2025 | 2024 | | :--- | :--- | :--- | | Profit for the Year | 355,414 | 380,704 | | Other Comprehensive Loss for the Year (After Tax) | (50,891) | (29,201) | | Total Comprehensive Income for the Year | 304,523 | 351,503 | [Consolidated Statement of Financial Position](index=4&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, total assets increased to HKD 4.78 billion, total liabilities rose to HKD 2.14 billion, and total equity slightly increased to HKD 2.64 billion; asset growth was driven by increases in property, plant, and equipment and inventories, while liability growth primarily stemmed from increased bank borrowings, with net current assets remaining stable Consolidated Statement of Financial Position Summary | Item (HKD Thousand) | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Non-current Assets | 2,550,769 | 2,399,172 | | Current Assets | 2,227,826 | 2,048,931 | | **TOTAL ASSETS** | **4,778,595** | **4,448,103** | | **EQUITY** | | | | Total Equity | 2,637,705 | 2,598,959 | | **LIABILITIES** | | | | Non-current Liabilities | 727,656 | 588,066 | | Current Liabilities | 1,413,234 | 1,261,078 | | **TOTAL LIABILITIES** | **2,140,890** | **1,849,144** | | **TOTAL EQUITY AND LIABILITIES** | **4,778,595** | **4,448,103** | - Inventories significantly increased from **HKD 910 million** to **HKD 1.21 billion**, while cash and cash equivalents decreased from **HKD 720 million** to **HKD 430 million**[6](index=6&type=chunk) [Management Discussion and Analysis](index=18&type=section&id=Management%20Discussion%20and%20Analysis) [Market and Business Review](index=18&type=section&id=Market%20and%20Business%20Review) Facing global economic slowdown and cautious consumer behavior, the company strategically expanded its Vietnam capacity to effectively counter reduced orders from mainland China; despite a 9.6% sales volume decrease in core knitwear due to delayed seasonal shifts, stable group revenue and improved gross margin were achieved, thanks to contributions from other businesses like cashmere yarn and fabrics - The company leveraged its expanded capacity in Vietnam to address the trend of **order shifts to Southeast Asia**, maintaining **business stability**[48](index=48&type=chunk)[50](index=50&type=chunk) - Sales volume of men's and women's knitwear decreased by **9.6%** to **29.1 million pieces**, partially offset by an increase in average selling price[51](index=51&type=chunk) - Other businesses, such as **cashmere yarn and fabrics**, began to scale, contributing **more significantly** to group revenue and demonstrating the effectiveness of **business diversification**[49](index=49&type=chunk)[52](index=52&type=chunk) [Future Strategies and Outlook](index=20&type=section&id=Future%20Strategies%20and%20Outlook) Looking ahead, the company will deepen its strategic presence in Vietnam, leveraging cost and trade advantages, while actively developing upstream businesses like traceable cashmere yarn and fabric printing to enhance vertical supply chain integration; through product innovation, lean manufacturing, and digital transformation, the company aims to improve operational resilience, capture new customer opportunities, and achieve profitable growth - Continue to expand the advantages of the **Vietnam production base** and seize cooperation opportunities with international clients[57](index=57&type=chunk) - Expand upstream by developing **cashmere yarn business** and venturing into **fabric printing** to meet both internal and external customer demands[55](index=55&type=chunk)[56](index=56&type=chunk) - Committed to **product design innovation**, **functionality and material development**, and seeking breakthroughs in **lean manufacturing** and **digitalization** to adapt to market changes[58](index=58&type=chunk) [Financial Review](index=21&type=section&id=Financial%20Review) This fiscal year, the company's financial performance presented a complex picture: revenue slightly decreased while gross margin improved; net other income significantly declined due to reduced exchange gains and asset disposal gains; operating expenses increased; cash flow from operating activities generated net cash inflow, but overall cash levels decreased due to capital expenditures and dividend payments; the company's financial leverage increased to support business expansion [Revenue](index=21&type=section&id=Revenue) Total revenue slightly decreased by **0.6%** year-on-year to **HKD 4.352 billion**, primarily due to a **4.2%** decline in men's and women's knitwear sales to **HKD 3.365 billion**, resulting from a **9.6%** volume decrease and a **6.0%** average selling price increase; Japan, mainland China, and Europe remained the top three markets - Sales volume of men's and women's knitwear decreased from **32.2 million pieces** to **29.1 million pieces**, primarily due to weak customer demand caused by a delayed seasonal onset of winter[60](index=60&type=chunk) - Average selling price of men's and women's knitwear increased from **HKD 109.1** to **HKD 115.6 per piece**, mainly due to changes in product mix[60](index=60&type=chunk) Revenue by Region | Region | Proportion of Total Revenue (FY2025) | | :--- | :--- | | Japan | 25.2% | | Mainland China | 19.2% | | Europe | 19.1% | [Gross Profit and Gross Margin](index=22&type=section&id=Gross%20Profit%20and%20Gross%20Margin) Gross profit increased by **1.0%** year-on-year to **HKD 782 million**, with gross margin improving from **17.7%** to **18.0%**, primarily driven by improved performance in the fabrics business and sustained resilience in the core knitwear business despite declining sales - The growth in gross profit and gross margin is primarily attributed to improved performance in the **fabrics business** and sustained resilience in the **knitwear business**[63](index=63&type=chunk) [Other Income and Gains](index=22&type=section&id=Other%20Income%20and%20Gains) Other income increased from **HKD 13.3 million** to **HKD 20.5 million**, mainly due to **HKD 10.9 million** in rental income from mainland China factory premises; net other gains significantly decreased from **HKD 78.2 million** to **HKD 41.2 million**, primarily due to a **HKD 21 million** reduction in exchange gains and a **HKD 16.4 million** decrease in gains from disposal of equipment - Other income increased by **54.4%**, primarily from rental income generated by leasing out part of the mainland China factory premises[52](index=52&type=chunk)[64](index=64&type=chunk) - Net other gains decreased by **47.4%**, mainly due to reduced exchange gains and net gains from disposal of property, plant, and equipment[52](index=52&type=chunk)[66](index=66&type=chunk) [Expense Analysis](index=23&type=section&id=Expense%20Analysis) Sales and distribution expenses increased by **22.2%** year-on-year to **HKD 39.6 million**, primarily due to higher transportation costs; general and administrative expenses increased by **6.7%** year-on-year to **HKD 354 million**, mainly due to increased staff costs driven by business expansion - Sales and distribution expenses increased by **HKD 7.2 million**, primarily due to higher transportation costs[68](index=68&type=chunk) - General and administrative expenses increased by **HKD 22.1 million**, mainly due to higher staff costs resulting from business and customer base expansion[69](index=69&type=chunk) [Impairment Loss on Myanmar Production Base](index=23&type=section&id=Impairment%20Loss%20on%20Myanmar%20Production%20Base) No impairment loss on the Myanmar production base was recorded in FY2025, compared to **HKD 34 million** in the prior year; according to independent valuers, as of March 31, 2025, the recoverable amount of the base's assets, calculated as fair value less costs to sell, exceeded their net book value - No new impairment loss was incurred in FY2025, whereas an impairment loss of **HKD 34 million** was recorded in FY2024[70](index=70&type=chunk) - The impairment assessment used the market approach, with key assumptions including a **40%** discount on property asking prices, **5%** agency costs, and **10%** scrap value for machinery, consistent with the prior year[73](index=73&type=chunk) [Net Profit and Adjusted Net Profit](index=26&type=section&id=Net%20Profit%20and%20Adjusted%20Net%20Profit) Profit attributable to owners decreased from **HKD 362 million** to **HKD 342 million**; adjusted net profit (excluding non-recurring items like Myanmar impairment and derivative instrument losses) decreased from **HKD 397 million** to **HKD 343 million**, a **13.5%** decline, with adjusted net profit margin falling from **9.1%** to **7.9%** - The decrease in net profit was primarily due to a **HKD 37 million** reduction in net other gains and a **HKD 22.1 million** increase in general and administrative expenses, partially offset by the **HKD 34 million** Myanmar impairment loss in the prior year[78](index=78&type=chunk) Adjusted Net Profit Reconciliation | Item (HKD Million) | 2025 | 2024 | | :--- | :--- | :--- | | Profit Attributable to Owners | 342.3 | 361.7 | | Add: Impairment Loss on Myanmar Production Base | – | 34.0 | | Add: Loss from Derivative Financial Instruments | 0.4 | 0.8 | | **Adjusted Net Profit** | **342.8** | **396.5** | [Liquidity and Financial Resources](index=27&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's gearing ratio significantly increased from **8.9%** in the prior year to **20.1%**, reflecting increased debt to support business expansion; at year-end, cash and cash equivalents totaled **HKD 431 million**, primarily denominated in USD, RMB, and HKD, with capital expenditures mainly allocated to the construction of the new Vietnam production base and equipment procurement - Gearing ratio (net debt/total capital) increased from **8.9%** to **20.1%**[85](index=85&type=chunk) - Capital expenditures for the year amounted to approximately **HKD 467 million**, primarily for machinery and equipment purchases and new base construction in Vietnam[87](index=87&type=chunk) - As of March 31, 2025, the Group's capital commitments were approximately **HKD 157 million**[88](index=88&type=chunk) [Cash Flow Analysis](index=26&type=section&id=Cash%20Flow%20Analysis) This fiscal year, net cash generated from operating activities was **HKD 223 million**, but net cash outflow from investing activities (primarily equipment purchases) was **HKD 238 million**, and from financing activities (primarily dividend payments) was **HKD 272 million**, resulting in a net decrease of **HKD 287 million** in cash and cash equivalents Cash Flow Summary | Cash Flow Item (HKD Million) | FY2025 | | :--- | :--- | | Net Cash Generated from Operating Activities | 222.9 | | Net Cash Used in Investing Activities | (238.3) | | Net Cash Used in Financing Activities | (272.1) | | Net Decrease in Cash and Cash Equivalents | (287.5) | [Financial Risk Management](index=29&type=section&id=Financial%20Risk%20Management) The Group primarily faces foreign currency risk (RMB), interest rate risk, credit risk, and liquidity risk; the company manages these through close monitoring, not entering into forward foreign exchange contracts for RMB risk, using interest rate swap contracts for some interest rate risk, conducting credit assessments for customers, and utilizing cash flow forecasts to ensure financial stability - **Foreign Currency Risk**: Primarily arises from RMB-denominated operating expenses and USD-denominated sales, though USD risk is considered minimal; no forward contracts are entered into to hedge RMB risk[94](index=94&type=chunk) - **Interest Rate Risk**: Primarily stems from floating-rate bank borrowings; HKD interest rate swap contracts have been entered into to mitigate part of this risk[95](index=95&type=chunk) - **Credit Risk**: Managed by conducting regular credit assessments of customers, with bank deposits placed in financial institutions of high credit quality[96](index=96&type=chunk) - **Liquidity Risk**: Monitored through cash flow forecasts to ensure sufficient cash and bank financing are available to support operations[96](index=96&type=chunk) [Human Resources](index=30&type=section&id=Human%20Resources) As of March 31, 2025, the Group employed approximately **15,400** full-time staff across Vietnam, mainland China, and Hong Kong; total staff costs for the fiscal year (including directors' emoluments) amounted to **HKD 1.024 billion**; the company implements a performance and experience-linked remuneration policy and provides training to enhance employee skills Human Resources Metrics | Metric | Value | | :--- | :--- | | Total Full-time Employees (March 31, 2025) | Approx. 15,400 | | Total Staff Costs FY2025 | 1,023.9 HKD Million | [Other Information](index=31&type=section&id=Other%20Information) [Dividends](index=31&type=section&id=Dividends) The Board has declared a second interim dividend of **1.5 HK Cents per share** for the year ended March 31, 2025, bringing the total annual dividend to **11.3 HK Cents per share** (including the interim dividend of **9.8 HK Cents per share** already paid), representing a payout ratio of **75%** Dividend Declaration | Dividend Item | Amount Per Share (HK Cents) | | :--- | :--- | | FY2025 Interim Dividend | 9.8 | | FY2025 Second Interim Dividend | 1.5 | | **FY2025 Total Dividend** | **11.3** | - The full-year dividend payout ratio is **75%**[53](index=53&type=chunk) - The second interim dividend will be paid on or about **July 23, 2025**[98](index=98&type=chunk) [Use of Proceeds from Initial Public Offering](index=31&type=section&id=Use%20of%20Proceeds%20from%20Initial%20Public%20Offering) The approximately **HKD 635 million** net proceeds from the company's 2016 IPO have been fully utilized as planned, disclosed in the prospectus and subsequent announcements, for purposes including Vietnam factory construction, loan repayment, design capability enhancement, ERP system upgrades, and working capital supplementation - As of March 31, 2025, the approximately **HKD 635 million** net proceeds from the IPO have been fully utilized[100](index=100&type=chunk)[101](index=101&type=chunk) [Corporate Governance](index=32&type=section&id=Corporate%20Governance) During the reporting period, the company consistently complied with the Corporate Governance Code in the Listing Rules; the company adopted a standard code for directors' securities transactions, confirmed to be adhered to by all directors upon inquiry; the Audit Committee, comprising four independent non-executive directors, reviewed the annual financial statements - The company complied with all mandatory provisions of the **Corporate Governance Code** during the reporting period[104](index=104&type=chunk) - The Audit Committee comprises **four independent non-executive directors**, chaired by Mr. Fan Chun Wah, Andrew[105](index=105&type=chunk) - PricewaterhouseCoopers, the auditor, has reconciled the financial data in the results announcement with the audited accounts[106](index=106&type=chunk)

Revenue and Profit Performance - Total revenue increased by 2.2% to HKD 2,786.2 million, driven by growth in cashmere yarn sales and fabric business[15] - Net profit reached a record high of HKD 312.8 million, up 2.4% year-on-year[15] - Operating profit grew by 5.0% to HKD 390.4 million[15] - Gross profit and gross margin improved compared to the same period last year[15] - Revenue increased by 2.2% to HKD 2,786.2 million for the six months ended September 30, 2024, compared to HKD 2,726.4 million in the same period last year, driven by higher sales of cashmere yarn and fabrics[33] - Gross profit rose to HKD 553.5 million with a gross margin of 19.9% for the six months ended September 30, 2024, up from HKD 498.0 million and 18.3% in the same period last year, due to improved performance in the fabric business and strong performance in the knitwear business[35] - Profit attributable to owners of the company increased from HKD 289.1 million in the six months ended September 30, 2023, to HKD 298.2 million in the six months ended September 30, 2024, driven by improved fabric and knitwear business performance[47] - Adjusted profit increased from HKD 289.1 million in the six months ended September 30, 2023, to HKD 298.5 million in the six months ended September 30, 2024, with the adjusted profit margin rising slightly from 10.6% to 10.7%[50] - Net profit attributable to owners of the company was HKD 327 million[121] - Gross profit increased to HKD 764 million, up from HKD 592 million in the previous period[121] Sales and Market Performance - Sales of men's and women's knitted products decreased by 5.0% to HKD 2,142.5 million, with a 5.3% drop in sales volume to 18.0 million pieces[14] - Sales of men's and women's knitwear products decreased by 5.3% to 18.0 million pieces for the six months ended September 30, 2024, compared to 19.0 million pieces in the same period last year, while the average selling price increased slightly by 0.1% to HKD 118.8 per piece[29] - Europe, Japan, and Mainland China remained the company's top three markets, contributing 22.7%, 21.3%, and 18.1% of total revenue, respectively, for the six months ended September 30, 2024[34] - Revenue from China's exports increased by 4.9%, while Vietnam's exports rose by 14.7%[10] Dividend and Shareholder Returns - The company declared an interim dividend of HKD 0.098 per share, with a payout ratio of 75%[15] - The company declared an interim dividend of 9.8 HK cents per share for the six months ended September 30, 2024, an increase from 9.5 HK cents in 2023[94] Operational and Strategic Initiatives - The company strategically expanded production capacity in central Vietnam to meet shifting market demands[11] - The company plans to expand its cashmere yarn business by relocating part of its operations to Vietnam, leveraging the growing demand for raw materials in the region[19] - The company has established partnerships for fabric printing and aims to become a leading raw material solutions provider in Vietnam[19] - The company remains committed to innovation, lean production, and digitalization to enhance product design and meet the diverse and rapidly changing preferences of end-market customers[23] - The company will continue to explore opportunities for business expansion and diversification while strengthening its core business to deliver greater returns to shareholders[23] Financial Position and Cash Flow - The company's cash flow remained strong, supported by prudent cash management[15] - Net cash generated from operating activities was HKD 106.5 million for the six months ended September 30, 2024, compared to HKD 383.6 million for the same period in 2023, impacted by increased trade receivables and prepayments[51][58] - Net cash used in investing activities was HKD 149.1 million for the six months ended September 30, 2024, primarily due to the purchase of property, plant, and equipment[59] - The company's gearing ratio increased from 8.9% as of March 31, 2024, to 14.3% as of September 30, 2024, reflecting higher debt levels relative to capital[57] - Cash and cash equivalents decreased by HKD 148.9 million to HKD 569.0 million as of September 30, 2024, compared to HKD 717.4 million on March 31, 2024[61] - The company's cash and cash equivalents are denominated in USD (60.2%), HKD (5.8%), RMB (30.5%), VND (3.2%), and other currencies (0.3%)[63] - Total bank borrowings and lease liabilities decreased by 77.0% in HKD, 22.2% in USD, and 0.8% in RMB as of September 30, 2024[65] - The weighted average effective interest rate on bank borrowings was 4.86% as of September 30, 2024[65] - Capital expenditures for the six months ended September 30, 2024, amounted to approximately HKD 316.8 million, primarily for machinery procurement and the construction of a new production base in Vietnam[66] - Capital commitments as of September 30, 2024, were approximately HKD 142.1 million, mainly for machinery procurement and the construction of a new production base in Vietnam[67] - The company utilized HKD 13.4 million of the IPO proceeds for the construction of a factory building and machinery procurement for the Dak Lak factory in Vietnam during the six months ended September 30, 2024[73] - The company had outstanding HKD interest rate swap contracts with a total notional principal of HKD 123.5 million as of September 30, 2024[78] - The company did not enter into any forward foreign exchange contracts to mitigate RMB-USD exchange rate risk during the six months ended September 30, 2024[79] - The company's liquidity risk management ensures sufficient cash and cash equivalents, as well as bank financing, to support its business and operational activities[82] - The company secured a three-year term loan facility of up to HK$150,000,000[178] - The company secured another three-year term loan facility of up to HK$130,000,000[179] - The company secured two term loan facilities totaling up to HK$300,000,000 for a period of three years[199] Expenses and Costs - Other income decreased by HKD 0.7 million to HKD 6.4 million for the six months ended September 30, 2024, mainly due to a reduction in government subsidies and other miscellaneous income, partially offset by an increase in rental income from investment properties[38] - Other income decreased from HKD 46.7 million in the six months ended September 30, 2023, to HKD 25.0 million in the six months ended September 30, 2024, primarily due to a smaller appreciation of the US dollar and reduced gains from the sale of property, plant, and equipment[39] - Sales and distribution expenses increased from HKD 17.8 million in the six months ended September 30, 2023, to HKD 21.0 million in the six months ended September 30, 2024, mainly due to higher transportation costs aligned with increased sales volume[40] - General and administrative expenses rose from HKD 162.2 million in the six months ended September 30, 2023, to HKD 173.5 million in the six months ended September 30, 2024, driven by increased employee costs due to business expansion[41] - Net finance costs increased slightly from HKD 23.1 million in the six months ended September 30, 2023, to HKD 25.2 million in the six months ended September 30, 2024, despite higher leverage, reflecting stable cash management[44] - The company's effective tax rate was 14.6% for the six months ended September 30, 2024, compared to 12.5% for the same period in 2023[47] - Total employee cost for the six months ended September 30, 2024, was HKD 544.0 million, with approximately 16,300 full-time employees across Mainland China, Vietnam, and Hong Kong[84] Corporate Governance and Shareholder Information - The company's largest shareholder, Mr. Wang Tingzhen, holds a 65.81% stake in the company through a trust[105] - The company's audit committee reviewed the interim financial report for the six months ended September 30, 2024, during a meeting held on November 22, 2024[98] - The company's directors and senior management receive salaries and performance-based bonuses, with compensation reviewed regularly by the remuneration committee[86] - The company provides training programs for new employees and ongoing development opportunities to enhance employee skills and knowledge[85] - The company's remuneration policy includes performance-based bonuses, insurance, medical benefits, and share options for employees[91] - The company adheres to high corporate governance standards, including maintaining a quality board, effective internal controls, and accountability to shareholders[95] - The company's controlling shareholder, Mr. Wong Ting Chung and/or his family members, will maintain at least 50% ownership of the company's issued share capital[177] - The company's controlling shareholder will maintain management control of the company[176] - The company's share option plan was adopted before the amended Listing Rules Chapter 17 (effective January 1, 2023) and may not fully comply with the amended rules[196] - The company will comply with the transitional arrangements for existing share schemes as of January 1, 2023, including but not limited to the scope of eligible participants and minimum vesting period requirements under the share option scheme[196] Share and Option Information - The company's total issued ordinary shares as of September 30, 2024, were 2,279,392,000[137] - The maximum number of shares that may be issued upon the exercise of all options under the share option plan shall not exceed 10% of the issued shares immediately after listing, i.e., a maximum of 200,000,000 shares[147] - The share option plan is valid for 10 years from April 12, 2016, and no additional options will be granted after this period[148] - Nanxuan Holdings Limited holds 1,500,000,000 shares, representing approximately 65.81% of the company's issued share capital[155] - The total number of issued ordinary shares as of September 30, 2024, is 2,279,392,000[161] - No share options were granted under the share option scheme during the six months ended September 30, 2024[190] - The weighted average exercise price of unexercised share options as of September 30, 2024 was HK$1.450[170] - The total number of share options available for grant under the share option scheme as of September 30, 2024 was 110,600,000, representing approximately 4.85% of the company's issued share capital[190] Related Party Transactions - The group's investment properties under irrevocable operating leases had future minimum lease payments totaling HKD 142,107 thousand as of September 30, 2024[126] - Lease payments to related party Hebei Yuteng Yangcheng Products Co., Ltd. amounted to HKD 4,323,000 for the six months ended September 30, 2024[129] - Lease payments to related party Huizhou Chuangyexing Property Management Co., Ltd. were HKD 21,000 for the six months ended September 30, 2023[130] - Prepayment for raw materials to Hebei Yuteng Cashmere Products Co., Ltd. increased to HK$305,288,000 as of September 30, 2024, from HK$124,564,000 as of March 31, 2024[140] - Trade payables to SML & FT (Vietnam) Limited increased to HK$5,616,000 as of September 30, 2024, from HK$2,975,000 as of March 31, 2024[140] - Other payables to Hebei Yuteng Cashmere Products Co., Ltd. increased to HK$195,652,000 as of September 30, 2024, from HK$83,641,000 as of March 31, 2024[140] - Lease liabilities to Han Yi Investment Co., Ltd. decreased to HK$8,347,000 as of September 30, 2024, from HK$8,568,000 as of March 31, 2024[140] - Lease payments to Tongxiang Yuteng Knitted Garments Co., Ltd. amounted to HK$412,000 for the six months ended September 30, 2024, compared to HK$446,000 for the same period in 2023[142] - Non-controlling shareholder loans of subsidiaries are unsecured, interest-free, denominated in RMB, and will mature in December 2026[143] Company Information - The company's website is http://www.namesonholdings.com[119] - The company's registered office is in the Cayman Islands[116] - The company's stock code is 1982[119] - The company's auditor is PricewaterhouseCoopers[119]

Investment Rating - The report maintains a "BUY" rating for Nameson Holdings with a target price of HKD 1.01, indicating an upside potential of 24.7% from the current price of HKD 0.81 [1]. Core Insights - Nameson's 1HFY25 results were largely in line with expectations, with sales and adjusted net profit growing by 2.2% and 3.3% year-on-year, respectively, reaching HKD 2,726 million and HKD 299 million [1][6]. - The blended gross margin improved by 1.6 percentage points year-on-year to 19.9%, attributed to lower raw material prices and enhanced operational efficiency at the Vietnam plant [1][6]. - The company experienced a normalization in order volumes for whole garments, which temporarily affected total sales volume, while traditional knitwear and cashmere products provided volume support [1][6]. - Sales volume for Nameson reached 18 million pieces in 1HFY25, a decrease of 5.7% year-on-year, with cashmere sales volume increasing significantly by 74% year-on-year to 1.6 million pieces [1][6]. Summary by Sections Financial Performance - Nameson's 1HFY25 average selling price (ASP) remained stable year-on-year at approximately US$18, with cashmere sales enjoying a higher ASP of around US$40, while traditional knitwear maintained an ASP of US$13-14 [1][6]. - The company expects FY25E sales to decline by approximately 1% year-on-year, primarily due to lower whole garment sales volume, offset by a stable blended ASP due to a better product mix [1][6]. Market Dynamics - Sales in Europe and Southeast Asia outperformed, growing by 23.1% and 37.7% year-on-year, respectively, driven by favorable weather and clients' overseas expansion [1][6]. - Conversely, sales in Japan and China faced challenges, declining by 23% and 3.9% year-on-year, respectively, due to late winter and macroeconomic headwinds [1][6]. Operational Insights - Nameson manufactured 70% of its total sweaters in Vietnam during 1HFY25, with plans to continue expanding capacity in Central Vietnam [3]. - The company has ramped up its cashmere yarn production, achieving over 550 tons in 1HFY25, with a significant increase in revenue from its branded cashmere yarn, M.oro, which rose by 26.8% to approximately HKD 419 million [4][5]. Valuation and Outlook - Nameson is trading at an undemanding FY25E/26E PE of 4.4x/4.0x, which is approximately a 46% discount to peers' average [7]. - The company maintains a healthy balance sheet with a low net gearing ratio of 14.3% in 1HFY25, allowing for a sustainable payout ratio of around 75% [8].

Investment Rating - The report does not provide a specific investment rating for the company [2]. Core Insights - The company, Nanxun Holdings (01982.HK), achieved a total revenue of HK$ 438.79 million for the first half of the fiscal year ending September 2024, reflecting a year-on-year growth of 2.2% and an increase in gross margin to 19.9% [2][6]. - The company declared an interim dividend of HK$ 0.098 per share [2]. - Sales of knitted products experienced a slight decline, with a 5.0% decrease in sales volume compared to the same period last year, despite a positive impact from an increase in average selling prices [2]. - The cashmere yarn business showed significant growth, with a year-on-year increase of 26.8% to HK$ 420 million, driven by both domestic and export demand [2]. - The company is focusing on optimizing operational efficiency, benefiting from improved operational efficiency in existing factories in Vietnam and rental income from the central factory [2]. Summary by Sections Financial Performance - Total revenue for the fiscal year 2023/24 is projected at HK$ 4,378.9 million, with a slight decline expected in sales volume for 2024/25 [2][9]. - The gross profit for the fiscal year 2023/24 is expected to be HK$ 774.2 million, with a gross margin of 17.7% [9]. - Net profit for the fiscal year 2023/24 is projected at HK$ 380.7 million, reflecting a year-on-year growth of 140.5% [9]. Market Position - The company has a market capitalization of HK$ 2.1 billion and a price-to-earnings ratio of 5.5x [6]. - The company is positioned within a competitive landscape, with peers such as Shenzhou International and others showing varying financial metrics [6]. Operational Insights - The company is experiencing challenges in the fabric business, with ongoing concerns about the absorption of new production capacity [2]. - The company is not planning to reduce its dividend payout ratio despite the pressures from new factory setups in Vietnam [2].