Core Viewpoint - The company, High Dimension Technology (02086), anticipates a net loss of approximately HKD 5.2 million in the first half of 2025, a significant decline from a net profit of HKD 2.1 million in the same period of 2024 [1] Financial Performance - Total revenue is expected to decrease by about 13.5% to HKD 40.83 million, down from HKD 47.21 million in the previous period [1] - The decline in revenue is attributed to reduced demand for products due to global economic slowdown, ongoing tariff disputes, and unstable trade environments [1] Cost Factors - Employee costs have risen by approximately 10.8% to HKD 16.98 million, primarily due to the introduction of a sales incentive program and an increase in staff for technology and R&D departments to meet ongoing product development needs [1] - Administrative expenses have surged by about 94% to HKD 7.35 million, driven by the company's expansion into new markets, diversification of product offerings, and increased operational costs [1] Business Strategy - The increase in administrative expenses is also linked to the need for upgrading backend systems, increased travel expenses due to more trade shows, and enhanced relationships with business partners [1]

Core Viewpoint - The company, 高维科技, is expected to report a net loss of approximately 5.2 million HKD for the six months ending June 30, 2025, a significant decline from a net profit of 2.1 million HKD in the previous period [1] Group 1: Financial Performance - The total revenue decreased by approximately 13.5% to 40.83 million HKD, down from 47.21 million HKD in the previous period, primarily due to reduced group earnings reflecting global economic slowdown and trade uncertainties [2] - Employee costs increased by about 10.8% to 16.98 million HKD, compared to 15.32 million HKD in the previous period, driven by the introduction of a sales incentive program and expansion of the technical and R&D workforce [2] - Administrative expenses surged by approximately 94% to 7.35 million HKD, up from 3.79 million HKD in the previous period, attributed to market expansion, product diversification, and increased business travel expenses [2]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示 概 不 就 因 本 公 告 全 部 或 任 何 部 分 內 容 而 產 生 或 因 倚 賴 該 等 內 容 而 引 致 之 任 何 損 失 承 擔 任 何 責 任。 Leadway Technology Investment Group Limited 高維科技投資集團有限公司 – 1 – 本公告所載資料僅以本公司對本集團於報告期間的綜合管理賬目而作出之初 步 評 估 為 基 礎，其 並 未 經 本 公 司 核 數 師 或 董 事 會 審 核 委 員 會 審 核 或 審 閱，並 可 能 作 出 調 整。本 公 司 正 在 敲 定 本 集 團 於 報 告 期 間 的 綜 合 中 期 業 績，其 預 期 將 於 二 零 二 五 年 八 月 底 之 前 刊 發。 本 公 司 股 東 及 有 意 投 資 者 於 買 賣 本 公 司 股 份 時 務 須 審 慎 行 事。 （於開曼群島註冊成立之有限公司） （股票代號：2086） 盈利警告 本 公 告 由 高 ...

[Supplemental Announcement: 2024 Annual Report and Continuing Connected Transactions](index=1&type=section&id=Supplemental%20Announcement%3A%202024%20Annual%20Report%20and%20Continuing%20Connected%20Transactions) This document provides a supplemental announcement regarding the 2024 annual report and clarifies the status of a continuing connected transaction [Basic Announcement Information](index=1&type=section&id=Basic%20Announcement%20Information) This supplemental announcement from Leadway Technology Investment Group Limited clarifies the status of a specific continuing connected transaction related to its 2024 annual report - Company Name: Leadway Technology Investment Group Limited, Stock Code: **2086**[2](index=2&type=chunk) - Announcement Type: Supplemental announcement, concerning the 2024 annual report and continuing connected transactions[2](index=2&type=chunk)[3](index=3&type=chunk) [Background: Continuing Connected Transactions](index=1&type=section&id=Background%3A%20Continuing%20Connected%20Transactions) The company previously announced a cooperation agreement with Zhongzhao on August 20, 2024, which constitutes a continuing connected transaction - References the annual report announcement published on April 29, 2025[3](index=3&type=chunk) - The company entered into a cooperation agreement with Zhongzhao on August 20, 2024, which is a continuing connected transaction[3](index=3&type=chunk) [Core Supplemental Disclosure](index=1&type=section&id=Core%20Supplemental%20Disclosure) The Board clarifies that no transactions under the continuing connected transaction with Zhongzhao occurred up to or during the fiscal year ended December 31, 2024 - No continuing connected transactions between the Group and Zhongzhao occurred up to or during the fiscal year ended December 31, 2024[5](index=5&type=chunk) - Neither party paid nor received any consideration during the relevant period[5](index=5&type=chunk) [Other Important Information](index=1&type=section&id=Other%20Important%20Information) All other information in the previous announcement remains unchanged, and the Board of Directors' composition as of the announcement date is provided - All other information contained in the previous announcement remains unchanged, except for this supplemental disclosure[6](index=6&type=chunk) - The Board of Directors comprises **four** executive directors, **two** non-executive directors, and **four** independent non-executive directors[7](index=7&type=chunk)

Financial Performance - The company's revenue increased by 27% year-on-year, rising from HKD 79.2 million in 2023 to HKD 100.3 million in 2024[6]. - Gross profit reached HKD 52.4 million, with a gross margin of 52%[10]. - The company reported a net profit of HKD 3.7 million, a significant turnaround from a loss of HKD 19.2 million in the previous year[6]. - Revenue from the European market surged from HKD 35.8 million in 2023 to HKD 57.9 million in 2024, driven by strong market development[11]. - Total operating expenses decreased by 22% to HKD 49.0 million, primarily due to effective cost-saving measures[13]. - Basic earnings per share improved to HKD 1.168 from a loss of HKD 6.012 per share in the previous year[10]. - The company successfully transitioned from a net loss to a net profit, demonstrating effective cost control measures and strategic market initiatives[16]. - Sales to the top five customers accounted for 35% of total revenue in the fiscal year ending December 31, 2024, up from 23% in 2023[23]. Product Development and Innovation - The company launched several innovative products, including the ACR1555U secure Bluetooth NFC reader and WalletMate II mobile wallet NFC module, which received positive market feedback[7]. - The company launched several cutting-edge solutions, including the ACR1555U secure Bluetooth NFC reader and WalletMate II mobile wallet NFC reader module, receiving positive market feedback[18]. - The development cost for new products and services was HKD 2.6 million for the fiscal year ending December 31, 2024, compared to HKD 2.9 million in 2023[28]. - The company plans to launch multiple breakthrough solutions in 2025, aligning with its strategy to enhance existing core products and expand into new market segments[19]. Market Expansion and Strategy - The company is diversifying its market focus towards regions with growth potential, including the Americas, Japan, China, and Southeast Asia[18]. - The company plans to participate in key exhibitions and enhance digital marketing strategies to support ongoing expansion efforts[8]. - The company is optimistic about future growth opportunities, particularly with the positive trends in its Japan office operations[8]. Cost Management and Efficiency - The company has implemented cost optimization measures, including streamlining workforce and initiating the Manila branch deregistration process, which is expected to improve operational efficiency[20]. - The company's cash and cash equivalents increased from HKD 20.2 million to HKD 25.7 million, reflecting strategic resource allocation and operational improvements[30]. - The company's net assets rose from HKD 58.2 million as of December 31, 2023, to HKD 61.8 million, primarily due to key investments in innovation and market expansion[30]. - The company's debt ratio remains at 0% as of December 31, 2024, unchanged from the previous year[31]. Corporate Governance and Management - The company has a diverse board with members holding qualifications from prestigious institutions, enhancing governance and oversight capabilities[46]. - The management team includes professionals with significant experience in finance, accounting, and corporate governance, ensuring strategic decision-making[48]. - The board's composition reflects a commitment to strong corporate governance and compliance with regulatory standards[46]. - The company has adopted a set of trading rules for directors that comply with the standards set out in the Listing Rules Appendix C3[61]. - The company has deviated from the corporate governance code by having the same person serve as both the chairman and CEO, which the board believes ensures effective strategy execution[60]. Risk Management and Compliance - The company emphasizes high ethical standards and sustainable development as part of its corporate culture[54]. - The company has established a whistleblowing policy to facilitate reporting of potential misconduct confidentially and anonymously[90]. - The company has adopted an anti-bribery and anti-corruption policy, with no reports of fraud or misconduct that could significantly impact the financial statements for the year ending December 31, 2024[90]. - The board has reviewed and monitored compliance with legal and regulatory requirements throughout the year[86]. Environmental, Social, and Governance (ESG) Initiatives - The environmental, social, and governance (ESG) report outlines the company's management of significant operational issues and performance in environmental and social aspects[108]. - The company emphasizes the importance of sustainable development for growth and long-term competitiveness, implementing measures to manage environmental and social operational risks[114]. - The company has established a governance framework for ESG matters, with the board overseeing the management of ESG risks and policies to create long-term value[127]. - The company has conducted a materiality assessment to understand stakeholder expectations and concerns regarding ESG issues, enhancing future sustainability planning[129]. Climate Change and Sustainability Efforts - The company is focusing on reducing reliance on non-renewable energy sources in daily operations to achieve zero carbon emissions[170]. - The company plans to invest in innovative energy-saving products to address climate-related risks, which may lead to increased capital expenditures[184]. - The company aims to achieve significant energy savings by recording energy consumption to identify peak usage periods[179]. - The company is actively identifying existing and future climate-related risks and opportunities through a robust risk management process overseen by the board[174].

Company Overview - High Dimension Technology Group Limited is an investment holding company primarily engaged in the development and sales of smart card products, software, and hardware [2] - The company also provides smart card-related services and develops automatic toll collection system products and solutions through its subsidiaries in Hong Kong [2] Financial Performance - As of December 31, 2024, High Dimension Technology reported total revenue of 92.87 million yuan, representing a year-on-year growth of 26.61% [1] - The net profit attributable to the parent company was 3.46 million yuan, showing a significant increase of 119.43% year-on-year [1] - The gross profit margin stood at 52.27%, while the debt-to-asset ratio was 34.24% [1] Stock Performance - As of April 15, the stock price of High Dimension Technology closed at 0.44 HKD per share, marking an increase of 18.92% [1] - Over the past month, the stock has experienced a cumulative decline of 2.63%, and a year-to-date decline of 11.9%, underperforming the Hang Seng Index, which has risen by 6.77% [1] Industry Valuation - The average price-to-earnings (P/E) ratio for the information technology equipment industry is 36.31 times, with a median of 3.1 times [1] - High Dimension Technology's P/E ratio is 31.68 times, ranking 25th in the industry [1] - Comparatively, other companies in the industry have the following P/E ratios: Changhong Jiahua at 2.68 times, Southern Communication at 3.51 times, SIS INT'L at 3.8 times, Putian Communication Group at 4.96 times, and Huaxian Optoelectronics at 5.79 times [1]

Financial Performance - For the year ending December 31, 2024, the group's revenue increased by 27% to HKD 100.3 million, compared to HKD 79.2 million in the same period of 2023[4] - The group's gross profit for the year ending December 31, 2024, rose by 24% to HKD 52.4 million, up from HKD 42.3 million in 2023[4] - The group recorded an annual profit of HKD 3.7 million for the year ending December 31, 2024, a significant recovery from a loss of HKD 19.2 million in 2023[4] - Total revenue for 2024 reached HKD 100,287,000, up from HKD 79,207,000 in 2023, marking a year-over-year increase of 26.6%[21] - Basic earnings per share improved to a profit of HKD 3,732,000 in 2024, compared to a loss of HKD 19,211,000 in 2023[25] - Gross profit for the year was HKD 52.4 million, with a gross margin of 52%, slightly down from 53% in the previous year[34][36] Assets and Liabilities - Total assets less current liabilities increased to HKD 64.9 million in 2024 from HKD 62.5 million in 2023[7] - The group's net assets rose to HKD 61.8 million in 2024, compared to HKD 58.2 million in 2023[8] - Cash and cash equivalents increased to HKD 25.7 million in 2024 from HKD 20.2 million in 2023[7] - Accounts receivable, net of loss provisions, increased to HKD 15,133,000 in 2024 from HKD 6,662,000 in 2023, reflecting a growth of 126.5%[27] - Payables rose to HKD 25,063,000 in 2024, compared to HKD 11,029,000 in 2023, indicating an increase of 127.5%[30] - The group maintained a debt ratio of 0% as of December 31, 2024, consistent with the previous year[57] Dividends and Shareholder Returns - The board of directors did not recommend the payment of a final dividend for the year ending December 31, 2024[4] - The board does not recommend the payment of a final dividend for the year ended December 31, 2024, consistent with the previous year[32] - The group continues to maintain a sustainable dividend policy, balancing shareholder expectations with prudent capital management[40] Operational Efficiency and Cost Management - Research and development expenses decreased to HKD 12.9 million in 2024 from HKD 17.5 million in 2023, indicating a focus on cost management[5] - Operating expenses decreased by 22% to HKD 49.0 million from HKD 62.7 million in 2023, primarily due to cost-saving measures[37] - The group has initiated a deregistration process for its Manila subsidiary, which is expected to further improve operational efficiency and cost savings once completed[46] - The group employed 93 full-time employees as of December 31, 2024, down from 113 the previous year, with employee costs amounting to HKD 29.8 million compared to HKD 40.2 million in 2023[63] Market and Product Development - The company operates primarily in the development, sales, and distribution of smart card products, software, and hardware[9] - The group operates as a single operating segment focused on the development, sale, and distribution of smart card products and related services[20] - Revenue from the development, sale, and distribution of smart card products was HKD 100,076 thousand in 2024, up from HKD 78,955 thousand in 2023, reflecting a growth of 27.0%[17] - New product launches include the ACR1555U secure Bluetooth NFC reader and WalletMate II mobile wallet NFC reader module, which received positive market feedback[41] - The WalletMate mobile wallet NFC reader won the IOTE Gold Award for "Innovative Product" in 2024, enhancing the company's reputation as a reliable supplier in the industry[45] - The group plans to launch several breakthrough solutions in 2025, focusing on innovation in the fintech and smart living sectors[44] Customer and Revenue Concentration - Customer A contributed HKD 15,285 thousand in 2024, representing over 10% of the total revenue, while in 2023, no customer contributed over 10%[18] - Sales to the top five customers accounted for 35% of the group's revenue for the year ending December 31, 2024, up from 23% in 2023, indicating increased reliance on a limited number of customers[48] Challenges and Strategic Focus - The global IC chip shortage poses significant challenges to production capacity, prompting the company to diversify suppliers to enhance future supply flexibility[51] - The company emphasizes the importance of balancing investment in new product development with maintaining financial stability amid supply chain reliability concerns[54] - The rapid development of artificial intelligence and automation technologies presents challenges in talent management, necessitating significant retraining for employees[50] - The company is diversifying its market focus towards regions such as the Americas, Japan, China, and Southeast Asia to mitigate risks from geopolitical tensions[42] Governance and Compliance - The audit committee reviewed the financial statements for the year ending December 31, 2024, ensuring compliance with internal control policies and financial reporting systems[68] - The company will disclose details regarding its corporate governance principles and procedures in the 2024 annual report[66] - The group has no significant contingent liabilities as of December 31, 2024[62] Other Financial Information - Interest income decreased to HKD 598,000 in 2024 from HKD 800,000 in 2023, a decline of 25.3%[21] - The group received government subsidies of approximately HKD 4,000 in 2024, significantly lower than HKD 116,000 in 2023, a decrease of 96.6%[21] - The group reported a significant increase in inventory write-downs, with HKD 4,000 in 2024 compared to HKD 1,511,000 in 2023[23] - There were no significant sales or investments in subsidiaries or associates during the year ending December 31, 2024[58] - The group had no capital commitments related to the acquisition of properties, plants, or equipment as of December 31, 2024[59] - The group has not engaged in any buybacks, sales, or redemptions of its listed securities during the year[64]

Financial Performance - Revenue for the six months ended June 30, 2024, was HKD 47,210,000, representing an increase of 3.6% compared to HKD 45,579,000 for the same period in 2023[2] - Gross profit for the same period was HKD 24,561,000, slightly up from HKD 24,397,000, indicating a stable gross margin[2] - Operating profit improved to HKD 2,284,000 from a loss of HKD 4,171,000 in the previous year, showcasing a significant turnaround[2] - Net profit attributable to equity holders was HKD 2,105,000, compared to a loss of HKD 4,363,000 in the prior year, reflecting a positive performance shift[3] - Basic and diluted earnings per share for the period were both 0.659 cents, recovering from a loss of 1.365 cents per share in the previous year[2] - Total comprehensive income for the period was HKD 1,430,000, compared to a loss of HKD 4,599,000 in the same period last year[3] Cash Flow and Liquidity - Cash and cash equivalents increased to HKD 22,983,000 from HKD 20,227,000, indicating improved liquidity[5] - Operating cash flow for the six months ended June 30, 2024, was HKD 6,131,000, a significant improvement from a cash outflow of HKD 9,027,000 in the same period of 2023, representing a turnaround of approximately 168%[7] - Cash and cash equivalents increased by HKD 2,792,000 compared to a decrease of HKD 13,160,000 in the previous year, showing a positive change in liquidity[7] - The total cash and cash equivalents as of June 30, 2024, stood at HKD 22,983,000, down from HKD 26,807,000 in the previous year[7] - The group achieved a net cash inflow from operating activities of HKD 6.1 million, compared to a net cash outflow of HKD 9.0 million in 2023, reflecting improved cash management[42] - The group’s cash and cash equivalents as of June 30, 2024, were HKD 23.0 million, up from HKD 20.2 million on December 31, 2023[42] Assets and Liabilities - Total assets as of June 30, 2024, were HKD 63,642,000, up from HKD 59,633,000 at the end of 2023[5] - The company reported a net asset value of HKD 59,660,000, an increase from HKD 58,230,000 at the end of the previous year[5] - Total liabilities increased to HKD 13,498,000 as of June 30, 2024, from HKD 11,029,000 as of December 31, 2023, marking an increase of about 22.4%[29] - Accounts receivable increased to HKD 7,910,000 as of June 30, 2024, from HKD 6,662,000 as of December 31, 2023, representing a growth of approximately 18.7%[26] - Accounts payable rose to HKD 9,331,000 as of June 30, 2024, compared to HKD 6,338,000 as of December 31, 2023, reflecting a significant increase of approximately 47.3%[29] Expenses and Cost Management - Research and development expenses decreased to HKD 6,763,000 from HKD 8,041,000, reflecting a focus on cost management[2] - Operating expenses decreased by 22% to HKD 22.7 million from HKD 29.2 million in the same period of 2023, primarily due to reduced staff costs and effective cost-saving measures[38] - Short-term employee benefits for key management personnel decreased to HKD 1,188,000 in 2024 from HKD 2,133,000 in 2023, a decline of approximately 44.2%[35] Market and Product Development - Revenue from external customers in Europe increased to HKD 26,911,000, a rise of 24.3% from HKD 21,699,000 in the previous year[13] - The group launched new products including the ACR1555U BT NFC reader and ACR1552U-A2 WaterGuard NFC reader in the first half of 2024, with more products expected in the second half[39] - The group plans to focus on the Americas and Southeast Asia markets due to procurement hesitance from European clients amid ongoing geopolitical tensions[39] Governance and Compliance - The company has adopted the corporate governance code as per the listing rules, with a deviation regarding the separation of roles between the Chairman and CEO, which is currently held by Mr. Zhang Xueqin since February 26, 2022[52] - The audit committee has reviewed the unaudited consolidated results for the six months ending June 30, 2024, and discussed relevant financial matters with the management[53] - The audit committee consists of four members, including Dr. Lian Dapeng (Chairman), Mr. Li Zhi Liang, Mr. Zhang Ding Fang, and Mr. Gu Tian Long[53] Shareholder Information - Major shareholders included Leadway Development Limited with 238,889,669 shares, representing 74.75% of the issued share capital as of June 30, 2024[49] - Mars Development Limited and its affiliates collectively held 239,215,679 shares, accounting for 74.85% of the issued share capital as of June 30, 2024[49] Other Information - The company did not recognize any tax provisions for Hong Kong profits tax due to recorded tax losses for both periods[19] - The group did not acquire any new right-of-use assets during the six months ended June 30, 2024, compared to HKD 906,000 for the same period in 2023[23] - There were no significant acquisitions or investments in subsidiaries or associated companies during the interim period[45] - The group had no capital commitments related to the acquisition of properties, plants, and equipment as of June 30, 2024[45] - The group did not mortgage any significant assets as of June 30, 2024[45] - There were no significant contingent liabilities as of June 30, 2024[45] - The company did not purchase, sell, or redeem any of its listed securities during the interim period[51] - The group manages foreign exchange risk through regular reviews of its foreign exchange risk exposure[45] - There were no plans authorized by the board for significant investments or capital asset increases during the interim period[45]

Financial Performance - For the six months ended June 30, 2024, the group's revenue increased by 4% to HKD 47.2 million compared to HKD 45.6 million for the same period in 2023[1] - The group reported a profit of HKD 2.1 million for the six months ended June 30, 2024, compared to a loss of HKD 4.4 million for the same period in 2023[1] - Gross profit for the six months ended June 30, 2024, was HKD 24.6 million, slightly up from HKD 24.4 million in the same period of 2023[2] - Operating profit for the period was HKD 2.3 million, a significant improvement from an operating loss of HKD 4.2 million in the previous year[2] - Basic and diluted earnings per share for the six months ended June 30, 2024, were HKD 0.659 cents, compared to a loss of HKD 1.365 cents per share in the same period of 2023[2] - Total comprehensive income for the period was HKD 1.43 million, recovering from a loss of HKD 4.6 million in the same period last year[3] - Revenue for the interim period was HKD 47.2 million, a 4% increase from HKD 45.6 million in the same period of 2023[20] Assets and Liabilities - Non-current assets decreased from HKD 17.98 million as of December 31, 2023, to HKD 15.63 million as of June 30, 2024[4] - Current assets increased from HKD 59.63 million as of December 31, 2023, to HKD 63.64 million as of June 30, 2024[4] - The group's net current assets improved from HKD 44.5 million to HKD 46.7 million during the same period[4] - Accounts receivable, net of impairment losses, increased to 7,910,000 HKD as of June 30, 2024, from 6,662,000 HKD as of December 31, 2023[17] - Accounts payable increased to 9,331,000 HKD as of June 30, 2024, from 6,338,000 HKD as of December 31, 2023, reflecting a growth of approximately 47.3%[18] - Net asset value as of June 30, 2024, was HKD 59.7 million, an increase of HKD 1.5 million from HKD 58.2 million on December 31, 2023[23] - The group's total assets as of June 30, 2024, were valued at HKD 59.7 million, up from HKD 58.2 million as of December 31, 2023[29] Cash Flow - As of June 30, 2024, the group's cash and cash equivalents amounted to HKD 23.0 million, an increase from HKD 20.2 million as of December 31, 2023[29] - The net cash inflow from operating activities during the interim period was HKD 6.1 million, compared to a net cash outflow of HKD 9.0 million in 2023, attributed to improved cash management and operational efficiency[29] - The group recorded a net cash outflow from investing activities of HKD 0.9 million, a decrease from HKD 1.8 million in 2023, due to reduced capital expenditures for project development[29] Operational Highlights - The company operates as a single business segment focused on the development, sale, and distribution of smart card products, software, and hardware, along with related services[10] - The company successfully launched new products including ACR1555U BT NFC reader and ACR1552U-A2 WaterGuard NFC reader in the first half of 2024, with more products expected in the second half[25] - The WalletMate NFC reader won the "Innovative Product" Gold Award at the International Internet of Things Exhibition (IOTE) 2024, highlighting the company's commitment to innovation[27] - The company anticipates positive growth opportunities in Japan following the reopening of its office in March 2023, with plans to allocate more resources to support market development[28] - The board has decided to cease operations in the Philippines to streamline business processes for sustainable growth[28] - The company remains optimistic about future growth despite global economic uncertainties, expecting new products to stimulate customer spending and generate new sales revenue[28] Expenses and Costs - Operating expenses decreased by 22% to HKD 22.7 million from HKD 29.2 million in the same period of 2023, primarily due to reduced staff costs and effective cost-saving measures[22] - The employee cost for the interim period was HKD 15.3 million, with a total of 91 dedicated full-time employees[34] Dividends and Shareholder Returns - The board does not recommend the payment of an interim dividend for the six months ended June 30, 2024[1] - The group has not engaged in any buybacks, sales, or redemptions of its listed securities during the interim period[35] Taxation - The company did not recognize any income tax provisions for Hong Kong profits tax due to tax losses recorded for the periods ended June 30, 2024, and June 30, 2023[14] Research and Development - The company successfully applied for a research and development subsidy of 116,000 HKD from the Shenzhen government in the previous reporting period[12] Debt and Financial Ratios - The debt ratio of the group was 0% as of June 30, 2024, consistent with the ratio as of December 31, 2023[30] - The group had no significant sales or acquisitions of subsidiaries or associates during the interim period[31] - As of June 30, 2024, the group had no major capital commitments related to the acquisition of properties, plants, or equipment[31] Audit and Review - The audit committee reviewed the unaudited consolidated results for the six months ended June 30, 2024, and discussed relevant financial matters with the management[38]

Financial Performance - The company's revenue decreased by 16% to HKD 79.2 million for the year ended December 31, 2023, down from HKD 94.2 million in 2022[10]. - Gross profit for the year was HKD 42.3 million, with a gross margin of 53%, compared to 52% in the previous year[10][12]. - The net loss for the year amounted to HKD 19.2 million, a significant decline from a profit of HKD 1.1 million in 2022[10]. - Operating expenses increased by 27% to HKD 62.7 million, primarily due to higher employee costs associated with overseas market expansion[13][14]. - The net asset value of the company decreased to HKD 58.2 million from HKD 77.9 million in the previous year, primarily due to the net loss incurred[13]. - Revenue from the European region fell from HKD 55.8 million in 2022 to HKD 35.8 million in 2023, significantly impacted by the ongoing war and economic downturn[11]. - The company's cash and cash equivalents decreased from HKD 40.0 million to HKD 20.2 million year-over-year, reflecting strategic allocation towards development projects and business improvements[34]. - The net assets of the company fell from HKD 77.9 million in 2022 to HKD 58.2 million in 2023, primarily due to investments in innovation and market expansion[34]. - Employee costs increased to HKD 40.2 million in 2023 from HKD 33.3 million in 2022, reflecting a rise in workforce expenses[42]. Product Development and Innovation - The company launched a low-cost contactless reader module specifically designed for the Chinese market as part of its strategy to expand its product range[5]. - The WalletMate Mobile Wallet NFC Reader was shortlisted for the Best New Product category at the 2023 RFID Journal Awards, highlighting the company's innovation efforts[5]. - The company successfully launched new products such as PocketKey and USB NFC Reader IV, reflecting its commitment to expanding its product portfolio and enhancing core product quality[18]. - The company aims to stimulate growth in 2024 through the launch of innovative products, anticipating increased market interest and higher sales revenue[6]. - The company is strategically focused on capturing the rapidly growing contactless payment solutions market, demonstrating its ability to adapt to market dynamics[20]. Market Expansion and Strategy - The company continues to strengthen its position in the fintech and smart living industries, focusing on advanced contactless readers, smart cards, and related devices[16]. - The company established a new office in Japan in 2023, marking a strategic expansion into global markets and indicating good development opportunities[22]. - The company has engaged three manufacturers for smart card production and three for smart card reader manufacturing, maintaining stable relationships to ensure product delivery timelines[26]. - The company plans to adopt a cautious pricing strategy and reduce product costs to maintain competitiveness amid global economic fluctuations[6]. - The company has implemented measures to mitigate global adverse factors, including diversifying market focus and revising pricing strategies to maintain resilience and growth[19]. Corporate Governance - The board of directors is committed to enhancing corporate governance practices and believes that good governance is essential for protecting shareholder interests and increasing group value[65]. - The company has adopted the corporate governance code as per the Stock Exchange Listing Rules and believes it has complied with the code provisions for the year ending December 31, 2023, with some exceptions noted[65]. - The board consists of five executive directors, two non-executive directors, and four independent non-executive directors, ensuring a balanced composition for independent judgment[70]. - The company has established a plan for the board to make decisions and for management to handle operational matters, which will be reviewed regularly[69]. - The company emphasizes the importance of corporate governance in ensuring accountability and independent decision-making[65]. Environmental, Social, and Governance (ESG) Initiatives - The company is committed to sustainable development and has dedicated resources to manage ESG risks effectively[164]. - The company has established an Environmental, Social, and Governance (ESG) working group, which includes the CEO and heads of various departments, to oversee ESG procedures and risk management[165]. - The company conducts an annual materiality assessment to understand stakeholders' expectations and concerns regarding ESG matters, enhancing decision-making and impact management[166]. - The company has implemented measures to manage and monitor environmental and social operational risks[146]. - The company aims to reduce air pollutants, greenhouse gas emissions, and waste generation by 2025, using 2021 as the baseline year for its environmental management strategy[190]. Stakeholder Engagement - The company engages with stakeholders to ensure effective communication and maintain good relationships[147]. - The company has identified key stakeholders and established various communication channels to engage with them effectively[150]. - The company aims to provide equal opportunities for all shareholders to exercise their rights and actively participate in the company's business[120]. - The company encourages shareholders to participate in annual general meetings to communicate directly with the board of directors[121]. - Employees seek job security, career development opportunities, and a safe working environment, with initiatives in place to support these needs[153]. Risk Management - The company has evaluated the effectiveness of the internal control and risk management systems, confirming their adequacy and effectiveness[112]. - The risk management working group uses a risk management matrix to assess risk levels, with all identified risks recorded in a risk register[111]. - Regular risk management meetings are held to monitor identified risks and ensure the execution of risk plans[111]. - The company is committed to ensuring compliance with relevant laws and regulations through effective internal control and risk management systems[108]. Employee Management - As of the end of 2023, 37% of the company's full-time employees are engineers, with 60% having served for over five years, highlighting the importance of retaining skilled engineers for operational success[27]. - The company had 113 full-time employees as of December 31, 2023, down from 122 in the previous year, indicating a reduction in workforce size[42]. - The company encourages continuous professional development for all directors to enhance their knowledge and skills, ensuring compliance with corporate governance codes[77]. Financial Oversight - The auditor's fee for audit services provided by KPMG for the year ending December 31, 2023, was HKD 1,000,000[117]. - There were no significant disagreements between the auditor and the company's management for the year ending December 31, 2023[118]. - The audit committee's responsibilities include reviewing financial reports and risk management systems, ensuring the integrity of financial reporting[98].