Group 1 - The company anticipates a profit after tax ranging from approximately HKD 12 million to HKD 15 million for the six months ending June 30, 2025, compared to a profit of about HKD 7.5 million for the six months ending June 30, 2024 [1] - The board attributes the increase in profit primarily to optimized technological processes in customized equipment projects, which have led to a reduction in raw material costs as well as direct and indirect costs, thereby boosting gross profit [1]

Core Viewpoint - The company anticipates a significant increase in net profit for the six months ending June 30, 2025, projecting a profit between approximately HKD 12 million and HKD 15 million, compared to HKD 7.5 million for the same period ending June 30, 2024 [1] Group 1 - The expected increase in profit is primarily attributed to optimized technological processes in customized equipment projects, which have led to a reduction in raw material costs as well as direct and indirect costs, thereby enhancing gross profit [1]

Core Viewpoint - Rensheng Industrial Holdings (03628.HK) expects a significant increase in net profit for the six months ending June 30, 2025, projecting a profit between approximately HKD 12.0 million and HKD 15.0 million, compared to HKD 7.5 million in the same period last year [1] Financial Performance - The anticipated profit increase is attributed to optimized technological processes in customized equipment projects, which have led to a reduction in raw material costs as well as direct and indirect costs, thereby enhancing gross profit [1]

RENHENG Enterprise Holdings Limited 香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完 整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部分內容而產生或因倚賴該等內容 而引致的任何損失承擔任何責任。 仁恒實業控股有限公司 （於開曼群島註冊成立的有限公司） （股份代號：3628） 盈利預告 本公告乃仁恒實業控股有限公司（「本公司」，連同其附屬公司統稱「本集團」）根據香港聯合交易所有 限公司證券上市規則（「上市規則」）第13.09(2)(a)條及香港法例571章證券及期貨條例第XIVA部項下之 內幕消息條文（定義見上市規則）而作出。 本公司董事（「董事」）會（「董事會」）謹此知會本公司股東及有意投資者，根據本集團截至二零二五年六 月三十日止六個月（「相關期間」）未經審核綜合管理賬目的初步評估，預期本集團於相關期間將錄得 除稅後溢利介乎約12.0百萬港元至約15.0百萬港元，相比截至二零二四年六月三十日止六個月錄得除 稅後溢利約7.5百萬港元。 董事會認為，上述盈利增加的主要原因是定制設備項目中應用優化的技術工藝，令原材料成本以及 直接 ...

Group 1 - The board meeting of Renheng Industrial Holdings (03628.HK) is scheduled for August 29, 2025, to consider and approve the unaudited consolidated financial statements for the six months ending June 30, 2025 [1]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完 整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部分內容而產生或因倚賴該等內容 而引致的任何損失承擔任何責任。 仁恒實業控股有限公司（「本公司」）董事會（「董事會」）謹此宣佈，董事會會議將於二零二五年八月 二十九日（星期五）舉行，以（其中包括）考慮並批准本公司及其附屬公司截至二零二五年六月三十日止 六個月的未經審核綜合財務報表和其發佈及處理任何其他事宜。 RENHENG Enterprise Holdings Limited 仁恒實業控股有限公司 （於開曼群島註冊成立的有限公司） 承董事會命 仁恒實業控股有限公司 （股份代號：3628) 董事會會議通告 劉利 香港，二零二五年八月十三日 於本公告日期，執行董事為劉利女士，廖麗娟女士及文元先生；獨立非執行董事為林家禮博士、林 至頴先生及鄔煒先生。 主席及行政總裁 ...

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 截至月份: 2025年7月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 仁恒實業控股有限公司 第 1 頁 共 10 頁 v 1.1.1 FF301 II. 已發行股份及/或庫存股份變動 | 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) | 03628 | 說明 | | | | | | | | | | 已發行股份（不包括庫存股份）數目 | | | 庫存股份數目 | | 已發行股份總數 | | | 上月底結存 | | | | 804,000,000 | | 0 | | 804,000,000 | | 增加 / 減少 (-) | | | | | | | | | | 本月底結存 | | | | 804,000,000 | | 0 | | 804,000,000 | 呈交日期: 2025年8月4日 I. 法定/註冊股本變動 ...

Financial Performance - The company recorded a revenue of approximately HKD 114,896,000 for the year ended December 31, 2024, representing a decrease of about 7.7% compared to the previous year[6]. - The net profit attributable to shareholders for the year was approximately HKD 7,035,000, down from HKD 13,558,000 in 2023[6]. - The company recorded a profit of HKD 7,035,000 for the year ending December 31, 2024, down from HKD 13,558,000 for the previous year, representing a decline of approximately 48.2%[26]. - Revenue for 2024 was HKD 114,896,000, a decrease of 7.3% compared to HKD 124,423,000 in 2023[196]. - Gross profit for 2024 was HKD 38,527,000, down 15.7% from HKD 45,724,000 in 2023[196]. - Net profit for the year was HKD 7,035,000, a decline of 48.2% from HKD 13,558,000 in 2023[196]. - Basic and diluted earnings per share for 2024 were HKD 0.88, compared to HKD 1.69 in 2023, reflecting a decrease of 48%[196]. Revenue Sources - Revenue from the tobacco flavoring and blending machinery contracts was HKD 108,722,000, accounting for 94.6% of total revenue, compared to HKD 102,897,000 or 82.7% in the previous year[26]. - The average contract value for completed tobacco flavoring machinery contracts was HKD 4,727,000, down from HKD 6,431,000 in the previous year[28]. Expenses and Costs - Operating expenses decreased by HKD 597,000 or 2.2% to HKD 26,191,000 compared to HKD 26,788,000 in the previous year[29]. - Selling and distribution expenses decreased significantly by HKD 3,758,000 to HKD 6,452,000, attributed to a focus on a limited number of major clients[30]. - Administrative expenses increased by HKD 3,161,000 or 19.1% to HKD 19,739,000, mainly due to higher travel, welfare, and security expenses[30]. - Research and development expenses slightly decreased by HKD 67,000 or 1.4% to HKD 4,605,000[30]. Assets and Liabilities - The group's cash and cash equivalents reached HKD 96,630,000 as of December 31, 2024, compared to HKD 86,100,000 in 2023, primarily denominated in RMB and HKD[35]. - The net current assets of the group increased to HKD 106,521,000 as of December 31, 2024, from HKD 98,984,000 in 2023[35]. - The group maintained a zero debt ratio as of December 31, 2024, consistent with the previous year[35]. - Total assets less current liabilities increased to HKD 129,838,000 in 2024 from HKD 125,066,000 in 2023, representing a growth of 2.2%[198]. - Current assets net worth rose to HKD 106,521,000 in 2024, up from HKD 98,984,000 in 2023, an increase of 7.8%[198]. - Trade and other receivables increased to HKD 49,380,000 in 2024 from HKD 38,780,000 in 2023, a growth of 27.5%[198]. - Cash and cash equivalents decreased to HKD 59,532,000 in 2024 from HKD 86,100,000 in 2023, a decline of 30.8%[198]. Corporate Governance - The company has adopted all the corporate governance code provisions except for the separation of the roles of Chairman and CEO, as stated in code provision C.2.1[88]. - The board consists of six members, including three executive directors and three independent non-executive directors, ensuring a balanced governance structure[90]. - All independent non-executive directors have confirmed their independence and possess appropriate professional accounting qualifications or relevant financial management experience[99]. - The company has no established corporate governance committee, with the board authorized to perform governance functions[97]. - The roles of Chairman and CEO are held by the same individual, Liu Li, ensuring clarity in leadership[100]. - The company will present a resolution for the re-election of directors at the annual general meeting, including Liu Li and other newly appointed directors[104]. Environmental and Social Responsibility - The company is focused on sustainable development, aiming to create long-term value for shareholders and stakeholders[135]. - The environmental, social, and governance report is prepared in accordance with the Hong Kong Stock Exchange's guidelines for the fiscal year ending December 31, 2024[136]. - In the fiscal year 2024, the company emitted 388.14 tons of CO2 equivalent greenhouse gases, a decrease of 22.1% from 498.87 tons in fiscal year 2023[145]. - The total water consumption was approximately 23,557 tons in fiscal year 2024, a significant decrease of 49.7% from 46,748 tons in fiscal year 2023[147]. - The company strictly adheres to labor laws and regulations, with no reported violations during the reporting period[152]. - The company has committed to corporate social responsibility and community investment initiatives moving forward[175]. Employee and Workforce Information - Employee costs totaled approximately HKD 19,798,000 for the year ended December 31, 2024, slightly down from HKD 19,981,000 in 2023[37]. - The average employee count in fiscal year 2024 was 132, with a gender distribution of 20% female and 80% male[155]. - Employee turnover rates for fiscal year 2024 and 2023 were 9.09% and 5.56% respectively[161]. - The injury rate per 100 employees was 0% in fiscal year 2024, compared to 0.68% in fiscal year 2023[165]. - The employee training participation rate for females increased to 33.3% in fiscal year 2024 from 29% in fiscal year 2023[167]. Audit and Financial Reporting - The company confirmed that the consolidated financial statements for the year ending December 31, 2024, were prepared in accordance with relevant laws and listing rules[118]. - The auditors aim to obtain reasonable assurance that the financial statements are free from material misstatement[189]. - The audit report does not cover other information included in the annual report, which is the responsibility of the company's directors[183]. - The audit partner responsible for issuing the independent auditor's report is Ye Tianxing[193].

Financial Performance - For the year ending December 31, 2024, the revenue was HKD 114,896,000, a decrease of 7.7% compared to HKD 124,423,000 in 2023[3] - The gross profit margin for the year was 33.5%, down from 36.7% in 2023[3] - The profit attributable to shareholders for the year was HKD 7,035,000, compared to HKD 13,558,000 in 2023[3] - The total comprehensive income for the year was HKD 4,625,000, significantly lower than HKD 12,065,000 in 2023[3] - The company reported a decrease in net profit for 2024 to HKD 7,035,000, down from HKD 13,558,000 in 2023, indicating a decline of approximately 48%[21] - The group recorded a profit of HKD 7,035,000 for the year ended December 31, 2024, down from HKD 13,558,000 in 2023, reflecting a year-on-year revenue decline of approximately 7.7%[32] Assets and Liabilities - Non-current assets decreased from HKD 26,082,000 in 2023 to HKD 23,317,000 in 2024[5] - Current assets increased from HKD 209,435,000 in 2023 to HKD 222,154,000 in 2024[5] - The net current asset value improved from HKD 98,984,000 in 2023 to HKD 106,521,000 in 2024[5] - Trade receivables increased to HKD 39,274,000 in 2024 from HKD 24,787,000 in 2023, with a provision for credit losses of HKD 3,563,000[11] - The aging analysis of trade receivables shows that HKD 28,161,000 was overdue as of December 31, 2024, compared to HKD 1,524,000 in 2023, but these amounts are not considered bad debts[25] - Trade payables decreased to HKD 20,030,000 in 2024 from HKD 25,798,000 in 2023, with the average credit period for purchases being 90 days[27] - The group had cash and cash equivalents totaling HKD 96,630,000 as of December 31, 2024, up from HKD 86,100,000 in 2023[41] - The net current assets of the group as of December 31, 2024, were HKD 106,521,000, an increase from HKD 98,984,000 in 2023[41] - The group maintained a zero debt ratio as of December 31, 2024, consistent with the previous year[41] Revenue Breakdown - The revenue from customer contracts for machinery construction was HKD 108,722,000, with additional sales of other products totaling HKD 6,174,000[11] - Total revenue for the year 2023 was HKD 124,423,000, with HKD 102,897,000 from construction contracts and HKD 21,526,000 from other products[13] - Revenue from the tobacco flavoring machinery contracts reached HKD 108,722,000, accounting for 94.6% of total revenue, compared to HKD 102,897,000 or 82.7% in the previous year[32] Expenses - Operating expenses decreased to HKD 26,191,000 in 2024 from HKD 26,788,000 in 2023, a reduction of HKD 597,000 or 2.2%[35] - Selling and distribution expenses dropped significantly to HKD 6,452,000 from HKD 10,210,000, attributed to a focus on a limited number of key customers[36] - Research and development expenses for the year ended December 31, 2024, were HKD 4,605,000, a slight decrease of HKD 67,000 or 1.4% from HKD 4,672,000 in 2023[37] - Tax expenses for the year ended December 31, 2024, were HKD 3,299,000, compared to HKD 4,360,000 for the year ended December 31, 2023[37] Dividends - The company did not recommend a final dividend for the year ending December 31, 2024[3] - The company has not declared any dividends for 2024, consistent with 2023, maintaining a policy of no dividend distribution[22] - The board does not recommend the payment of dividends for the year ended December 31, 2024, consistent with the previous year[38] Government Support and Other Income - Government subsidies increased to HKD 1,047,000 in 2024 from HKD 574,000 in 2023, representing an increase of 82.5%[17] - The company’s total other income for 2024 was HKD 1,913,000, compared to HKD 1,545,000 in 2023, showing an increase of 23.8%[17] - Other income increased by HKD 368,000 or 23.8% to HKD 1,913,000, primarily due to increased subsidy income[34] Operational Insights - The warranty period for construction services ranges from one to three years, ensuring compliance with agreed specifications[14] - The company’s operations are primarily based in China, with all revenues derived from this market[16] - The average credit period for sales of other products is 90 days from delivery[15] - The average contract value for completed tobacco flavoring machinery contracts was HKD 4,727,000 in 2024, down from HKD 6,431,000 in 2023[34] Workforce - The group employed 136 staff as of December 31, 2024, down from 147 in 2023, with total employee costs approximately HKD 19,798,000 compared to HKD 19,981,000 in 2023[43] Future Outlook - The tobacco machinery industry is expected to maintain stable growth in the coming years, supported by the group's technological advancements and market opportunities[39] - The group will focus on capturing market opportunities in customized products and ensuring contracts across various machinery industries[40] Acquisitions - No significant acquisitions or disposals of subsidiaries occurred during the year ended December 31, 2024[44]

[Summary](index=1&type=section&id=%E6%91%98%E8%A6%81) RENHENG Enterprise Holdings Limited reported a 5.4% revenue increase and a significant rise in profit attributable to shareholders for the six months ended June 30, 2024, with no interim dividend recommended Financial Highlights (HKD thousands) | Indicator | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 60,979 | 57,840 | 5.4% | | Profit attributable to company shareholders | 7,555 | 804 | 839.7% | | Basic earnings per share (HKD cents) | 0.94 | 0.10 | 840.0% | - The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2024[1](index=1&type=chunk) [Condensed Consolidated Financial Statements](index=1&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This section presents the unaudited condensed consolidated financial statements for the six months ended June 30, 2024, including key financial statements and comparative data [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=1&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%8D%9F%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2024, the company reported a 5.4% revenue increase, a significant rise in gross profit and profit for the period, with basic earnings per share at HKD 0.94 cents Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (HKD thousands) | Indicator | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 60,979 | 57,840 | 5.4% | | Cost of sales | (40,191) | (43,337) | -7.26% | | Gross profit | 20,788 | 14,503 | 43.34% | | Other income | 1,188 | 335 | 254.63% | | Other gains and losses | 766 | 812 | -5.67% | | Selling and distribution costs | (2,510) | (4,274) | -41.28% | | Administrative expenses | (8,342) | (8,123) | 2.70% | | Research and development costs | (2,658) | (1,500) | 77.20% | | Profit before tax | 9,232 | 1,753 | 426.64% | | Tax | (1,677) | (949) | 76.71% | | Profit for the period | 7,555 | 804 | 839.68% | | Total comprehensive income (expense) for the period | 6,771 | (2,556) | - | | Basic earnings per share (HKD cents) | 0.94 | 0.10 | 840.00% | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E7%8A%B6%E5%86%B5%E6%8A%A5%E8%A1%A8) As of June 30, 2024, the company's net assets and net current assets increased, primarily driven by higher trade and other receivables Condensed Consolidated Statement of Financial Position (HKD thousands) | Indicator | June 30, 2024 (HKD thousands) | December 31, 2023 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 24,754 | 26,082 | -5.1% | | Current assets | 221,652 | 209,435 | 5.8% | | Current liabilities | 114,743 | 110,451 | 3.9% | | Net current assets | 106,909 | 98,984 | 8.0% | | Net assets | 130,157 | 123,386 | 5.5% | | Total equity | 130,157 | 123,386 | 5.5% | [Condensed Consolidated Statement of Changes in Equity](index=5&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%9D%83%E7%9B%8A%E5%8F%98%E5%8A%A8%E8%A1%A8) As of June 30, 2024, total equity increased to HKD 130,157 thousand, driven by profit for the period and special reserve transfers, partially offset by exchange reserve changes Condensed Consolidated Statement of Changes in Equity (HKD thousands) | Equity Item | January 1, 2023 (HKD thousands) | June 30, 2023 (HKD thousands) | January 1, 2024 (HKD thousands) | June 30, 2024 (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Share capital | 2,010 | 2,010 | 2,010 | 2,010 | | Share premium | 41,818 | 41,818 | 41,818 | 41,818 | | Merger reserve | 49,091 | 49,091 | 49,091 | 49,091 | | Discretionary surplus reserve | 3,338 | 3,338 | 3,338 | 3,338 | | Statutory surplus reserve | 25,607 | 25,607 | 27,529 | 27,529 | | Capital reserve | 999 | 999 | 999 | 999 | | Property revaluation reserve | 2,775 | 2,775 | 2,775 | 2,775 | | Special reserve | - | 628 | 970 | 2,658 | | Exchange fluctuation reserve | (1,049) | (4,409) | (2,542) | (3,326) | | Retained profits (accumulated losses) | (13,268) | (13,092) | (2,602) | 3,265 | | **Total** | **111,321** | **108,765** | **123,386** | **130,157** | - Statutory surplus reserve and discretionary surplus reserve are appropriated from after-tax profit in accordance with relevant PRC laws and regulations, used to cover losses or converted into capital[4](index=4&type=chunk) - Special reserve is appropriated in accordance with the "Measures for the Administration of Extraction and Use of Production Safety Fees" issued by the Ministry of Finance and the Ministry of Emergency Management, for improving production safety environment and facilities, and is not distributable to shareholders[4](index=4&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=7&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the six months ended June 30, 2024, net cash used in operating activities decreased, while net cash from investing activities significantly increased, with period-end cash at HKD 79,642 thousand Condensed Consolidated Statement of Cash Flows (HKD thousands) | Cash Flow Category | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | (12,093) | (24,208) | -50.05% | | Net cash generated from investing activities | 6,391 | 977 | 554.14% | | Net cash used in financing activities | (132) | (202) | -34.65% | | Net decrease in cash and cash equivalents | (5,834) | (23,433) | -75.11% | | Cash and cash equivalents at end of period | 79,642 | 72,264 | 10.21% | [Notes to the Condensed Consolidated Financial Statements](index=8&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8%E9%99%84%E6%B3%A8) This section provides detailed explanations and supplementary information for the condensed consolidated financial statements, including general information, accounting policies, and specific financial item analysis [1. General Information](index=8&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B5%84%E6%96%99) RENHENG Enterprise Holdings Limited, incorporated in the Cayman Islands and listed in Hong Kong, primarily manufactures and sells tobacco machinery in China, controlled by Ms. Liu Li, with financial statements presented in HKD - The Company is jointly controlled by LinkBest Capital Group Limited and Open Venture Global Limited, with Ms. Liu Li as the ultimate controlling shareholder[6](index=6&type=chunk) - The Company and its subsidiaries are principally engaged in the manufacturing and sale of tobacco machinery products in the PRC[6](index=6&type=chunk) - The Group's condensed consolidated financial statements are presented in Hong Kong Dollars, which is different from the Company's functional currency, Renminbi[6](index=6&type=chunk) [2. Basis of Preparation](index=8&type=section&id=2.%20%E7%BC%96%E5%88%B6%E5%9F%BA%E5%87%86) The unaudited condensed consolidated financial statements were approved by the Board and Audit Committee, prepared in accordance with HKAS 34 and Listing Rules Appendix 16 disclosure requirements - The condensed consolidated financial statements have been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[7](index=7&type=chunk) [3. Principal Accounting Policies](index=8&type=section&id=3.%20%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96) The condensed consolidated financial statements are prepared on a historical cost basis, consistent with prior year policies, with no significant impact from revised HKFRSs - The condensed consolidated financial statements have been prepared on the historical cost basis[8](index=8&type=chunk) - The application of the revised HKFRSs in the current interim period has had no material effect on the Group's financial positions and performance for the current and prior periods and/or on the disclosures set out in these condensed consolidated financial statements[9](index=9&type=chunk) [4. Revenue and Segment Information](index=9&type=section&id=4.%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B5%84%E6%96%99) The Group's primary revenue source is manufacturing and selling tobacco machinery products in China, with revenue from flavor blending and adding machinery construction contracts recognized at a point in time Revenue by Product Type (HKD thousands) | Product Type | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | | :--- | :--- | :--- | | Construction contracts for tobacco flavor and fragrance blending and adding machinery | 56,525 | 57,452 | | Sales of other products - pneumatic filament feeding systems | 3,785 | 195 | | Sales of other products - other goods | 669 | 193 | | **Total** | **60,979** | **57,840** | - The Group's operating activities are principally the manufacturing and sale of tobacco machinery products, which is a single operating segment[10](index=10&type=chunk) - Revenue from construction contracts for tobacco flavor and fragrance blending and adding machinery is recognized at a point in time when the completed machinery is transferred to the customer[13](index=13&type=chunk) [5. Other Income](index=10&type=section&id=5.%20%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5) For the six months ended June 30, 2024, other income significantly increased to HKD 1,188 thousand, driven by higher government grants and bank interest income Other Income Sources (HKD thousands) | Income Source | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Government grants | 741 | 57 | 1199.9% | | Bank interest income | 447 | 278 | 60.86% | | **Total** | **1,188** | **335** | **254.63%** | [6. Other Gains and Losses](index=11&type=section&id=6.%20%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E5%8F%8A%E4%BA%8F%E6%8D%9F) For the six months ended June 30, 2024, total other gains and losses were HKD 766 thousand, a slight decrease primarily due to exchange losses Other Gains and Losses (HKD thousands) | Item | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | | :--- | :--- | :--- | | Net gain from disposal of scrap materials, components and parts | 766 | 812 | | Exchange (losses) gains | (134) | 59 | | **Total** | **766** | **812** | [7. Profit Before Tax](index=11&type=section&id=7.%20%E9%99%A4%E7%A8%8E%E5%89%8D%E6%BA%A2%E5%88%A9) For the six months ended June 30, 2024, profit before tax was HKD 9,232 thousand, with a notable 77.2% increase in research and development costs Expenses Deducted from Profit Before Tax (HKD thousands) | Expense Item | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Directors' emoluments | 911 | 854 | 6.67% | | Other staff costs | 7,545 | 8,472 | -10.94% | | Total staff costs | 8,456 | 9,326 | -9.33% | | Auditor's remuneration | 542 | 631 | -14.10% | | Research and development costs | 2,658 | 1,500 | 77.20% | | Depreciation of property, plant and equipment | 1,069 | 1,057 | 1.14% | | Depreciation of right-of-use assets | 157 | 233 | -32.62% | [8. Tax](index=11&type=section&id=8.%20%E7%A8%85%E9%A1%B9) For the six months ended June 30, 2024, tax expense was HKD 1,677 thousand, mainly China corporate income tax, with Chinese subsidiaries benefiting from a 15% preferential tax rate as high-tech enterprises Tax Components (HKD thousands) | Tax Component | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | | :--- | :--- | :--- | | PRC corporate income tax – current | 1,840 | 1,088 | | Deferred tax | (163) | (139) | | **Total** | **1,677** | **949** | - The Company's PRC subsidiaries are entitled to a preferential tax rate of **15%** during the period, as they have been recognized and approved as high-tech enterprises[17](index=17&type=chunk) [9. Earnings Per Share](index=12&type=section&id=9.%20%E6%AF%8F%E8%82%A1%E7%9B%88%E5%88%A9) For the six months ended June 30, 2024, basic earnings per share significantly increased to HKD 0.94 cents, driven by a substantial rise in profit for the period Earnings Per Share Calculation | Indicator | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company (HKD thousands) | 7,555 | 804 | | Number of ordinary shares | 804,000,000 | 804,000,000 | | Basic earnings per share (HKD cents) | 0.94 | 0.10 | - The Group did not present diluted earnings per share for both periods as there were no issued potential ordinary shares in either period[18](index=18&type=chunk) [10. Dividends](index=12&type=section&id=10.%20%E8%82%A1%E6%81%AF) The Company's directors decided not to declare any dividends for the six months ended June 30, 2024 - The Directors of the Company have resolved not to declare any dividend for the interim period[19](index=19&type=chunk) [11. Inventories](index=12&type=section&id=11.%20%E5%AD%98%E8%B4%A7) As of June 30, 2024, total inventories decreased to HKD 64,538 thousand, mainly due to reductions in raw materials and work-in-progress Inventories by Category (HKD thousands) | Inventory Category | June 30, 2024 (HKD thousands) | December 31, 2023 (HKD thousands) | | :--- | :--- | :--- | | Raw materials | 4,450 | 8,650 | | Work-in-progress | 60,088 | 63,904 | | **Total** | **64,538** | **72,554** | [12. Trade and Other Receivables](index=13&type=section&id=12.%20%E8%B4%B8%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E5%BA%94%E6%94%B6%E8%B4%A6%E6%AC%BE) As of June 30, 2024, total trade and other receivables significantly increased to HKD 71,556 thousand, driven by higher trade receivables and prepayments and deposits Trade and Other Receivables (HKD thousands) | Receivables Category | June 30, 2024 (HKD thousands) | December 31, 2023 (HKD thousands) | | :--- | :--- | :--- | | Trade receivables (net of allowance) | 60,366 | 21,572 | | Trade receivables aging (0-90 days) | 27,360 | 20,048 | | Trade receivables aging (91-365 days) | 33,006 | 1,524 | | Total trade receivables | 63,558 | 24,787 | | Less: Allowance for credit losses | (3,192) | (3,215) | | Retention receivables (net of allowance) | 6,114 | 6,340 | | Prepayments and deposits | 681 | 5,161 | | Advances to staff | 829 | 367 | | **Total** | **71,556** | **38,780** | - The Group generally grants its trade customers a credit period of **three months**[22](index=22&type=chunk) [13. Restricted Bank Deposits / Bank Balances and Cash](index=14&type=section&id=13.%20%E5%8F%97%E9%99%90%E5%88%B6%E9%93%B6%E8%A1%8C%E5%AD%98%E6%AC%BE%E2%81%A0%E9%93%B6%E8%A1%8C%E7%BB%93%E4%BD%99%E5%8F%8A%E7%8E%B0%E9%87%91) As of June 30, 2024, restricted bank deposits secured bills payable and construction contracts, while bank balances and cash, mainly in RMB and HKD, earned market interest rates - Restricted bank deposits bear interest at effective annual rates ranging from **0.2% to 1.35%** and are used to settle bills payable and guarantee certain construction contracts[23](index=23&type=chunk) - Bank balances and cash bear interest at effective annual rates ranging from **0.15% to 3.78%**[23](index=23&type=chunk) [14. Trade and Other Payables](index=14&type=section&id=14.%20%E8%B4%B8%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E5%BA%94%E4%BB%98%E8%B4%A6%E6%AC%BE) As of June 30, 2024, total trade and other payables decreased to HKD 38,506 thousand, mainly due to reductions in bills payable and welfare expenses Trade and Other Payables (HKD thousands) | Payables Category | June 30, 2024 (HKD thousands) | December 31, 2023 (HKD thousands) | | :--- | :--- | :--- | | Trade payables | 20,028 | 16,622 | | Bills payable | 3,111 | 9,176 | | Accrued warranty provision | 4,671 | 5,406 | | Welfare expenses payable | 1,575 | 2,687 | | Other payables | 4,140 | 5,274 | | Other tax payables | 4,981 | 2,859 | | **Total** | **38,506** | **42,024** | Aging of Trade Payables and Bills Payable (HKD thousands) | Aging | June 30, 2024 (HKD thousands) | December 31, 2023 (HKD thousands) | | :--- | :--- | :--- | | 0 to 90 days | 19,448 | 14,587 | | 91 to 365 days | 3,019 | 9,164 | | One to two years | 403 | 1,443 | | Over two years | 269 | 604 | | **Total** | **23,139** | **25,798** | - The average credit period on purchases of goods is **90 days**[25](index=25&type=chunk) [Management Discussion and Analysis](index=15&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%82%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) This section provides a detailed overview of the Group's business, financial performance, capital structure, liquidity, future outlook, corporate governance, and employee policies [Business Overview](index=15&type=section&id=%E4%B8%9A%E5%8A%A1%E6%A6%82%E8%A7%88) The Group manufactures, sells, and maintains tobacco machinery in China, holding a national license, with key revenue from flavor blending, pneumatic filament feeding, and pre-pressing machinery - The Group is principally engaged in the business of manufacturing and selling tobacco machinery products in the PRC, and providing maintenance, overhaul, and modification services for these products[26](index=26&type=chunk) - The Group has obtained a Tobacco Monopoly Production Enterprise License issued by the China National Tobacco Corporation, making it one of **35** licensed domestic producers[26](index=26&type=chunk) - Revenue is primarily generated from three categories of specialized tobacco machinery products: tobacco flavor and fragrance blending and adding machinery, pneumatic filament feeding systems, and tobacco pre-pressing and packing machinery[26](index=26&type=chunk) [Financial Review](index=15&type=section&id=%E8%B4%A2%E5%8A%A1%E5%9B%9E%E9%A1%BE) For the six months ended June 30, 2024, the Group reported a significant profit increase to HKD 7,555 thousand, 4.6% revenue growth, improved gross margin to 34.1%, and a 77.2% rise in R&D costs Financial Performance (HKD thousands) | Indicator | H1 2024 (HKD thousands) | H1 2023 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit | 7,555 | 804 | 839.7% | | Revenue | 60,979 | 57,840 | 5.4% | | Revenue from construction contracts for tobacco flavor and fragrance blending and adding machinery | 56,525 | 57,452 | -1.61% | | Sales of pneumatic filament feeding systems | 3,785 | 195 | 1841.0% | | Sales of other goods | 669 | 193 | 246.63% | | Gross profit margin | 34.1% | 25.1% | +9.0pp | | Gross profit margin for tobacco flavor and fragrance blending and adding machinery construction contracts | 32.2% | 25.1% | +7.1pp | | Research and development costs | 2,658 | 1,500 | 77.2% | | Selling and distribution expenses | 2,510 | 4,274 | -41.3% | | Administrative expenses | 8,342 | 8,123 | 2.7% | | Tax expense | 1,677 | 949 | 76.7% | - An allowance for inventories of **HKD 887,000** was recognized in cost of sales, compared to a loss allowance of HKD 406,000 in the prior period[27](index=27&type=chunk) - Other income increased by **HKD 853,000** or **254.6%**, primarily from government grants and bank interest income[28](index=28&type=chunk) [Dividends](index=16&type=section&id=%E8%82%A1%E6%81%AF) The Directors do not recommend the payment of a dividend for the six months ended June 30, 2024 - The Directors do not recommend the payment of a dividend for the six months ended June 30, 2024[29](index=29&type=chunk) [Capital Structure, Liquidity and Financial Resources](index=17&type=section&id=%E8%B5%84%E6%9C%AC%E6%9E%B6%E6%9E%84%E3%80%81%E6%B5%81%E5%8A%A8%E8%B5%84%E9%87%91%E5%8F%8A%E8%B4%A2%E5%8A%A1%E8%B5%84%E6%BA%90) As of June 30, 2024, the Group maintained a stable capital structure with increased net current assets and significant bank balances, free from other borrowings or charges Capital Structure and Liquidity (HKD thousands) | Indicator | June 30, 2024 (HKD thousands) | December 31, 2023 (HKD thousands) | | :--- | :--- | :--- | | Net current assets | 106,909 | 98,984 | | Bank balances and cash | 79,642 | 86,100 | - The Group had no other borrowings, mortgages, or charges[30](index=30&type=chunk) [Contingent Liabilities](index=17&type=section&id=%E6%88%96%E7%84%B6%E8%B4%9F%E5%80%BA) As of June 30, 2024, the Group had no significant contingent liabilities - As of June 30, 2024, the Group had no significant contingent liabilities[31](index=31&type=chunk) [Material Investments Held](index=17&type=section&id=%E6%8C%81%E6%9C%89%E7%9A%84%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B5%84) For the period ended June 30, 2024, the Group's investment activities primarily involved short-term time deposits and property, plant, and equipment purchases - The Group's investment activities primarily included placing and withdrawing short-term time deposits and purchasing property, plant and equipment[32](index=32&type=chunk) [Material Acquisitions and Disposals](index=17&type=section&id=%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B4%AD%E5%8F%8A%E5%87%BA%E5%94%AE) For the six months ended June 30, 2024, the Group had no material acquisitions or disposals of subsidiaries - For the six months ended June 30, 2024, the Group had no material acquisitions or disposals of subsidiaries[33](index=33&type=chunk) [Business Review and Outlook](index=17&type=section&id=%E4%B8%9A%E5%8A%A1%E5%9B%9E%E9%A1%BE%E5%8F%8A%E5%89%8D%E6%99%AF) The Group, collaborating with China National Tobacco Corporation, benefits from industry stability and will pursue specialized product opportunities and technological innovation in automated machinery to enhance shareholder value - The Group primarily conducts business with its customer, the China National Tobacco Corporation[34](index=34&type=chunk) - The tobacco machinery industry is expected to maintain a **stable development momentum** in the coming years[34](index=34&type=chunk) - The Group will capture market opportunities for specialized products, secure contracts in various machinery industries, and commit to key technological innovations in the customized automated machinery industry to create greater value for shareholders[34](index=34&type=chunk) [Pre-IPO Share Option Scheme](index=18&type=section&id=%E9%A6%96%E6%AC%A1%E5%85%AC%E5%BC%80%E6%8B%9B%E8%82%A1%E5%89%8D%E8%B4%AD%E8%82%A1%E6%9D%83%E8%AE%A1%E5%88%92) The Pre-IPO Share Option Scheme incentivizes contributions to the Group, with no outstanding share options granted as of June 30, 2024 - The Pre-IPO Share Option Scheme aims to grant share options to participants to incentivize or reward their contributions to the Group[35](index=35&type=chunk) - As of June 30, 2024, no outstanding share options had been granted[35](index=35&type=chunk) [Share Option Scheme](index=18&type=section&id=%E8%B4%AD%E8%82%A1%E6%9D%83%E8%AE%A1%E5%88%92) The Share Option Scheme aims to incentivize individuals by offering company equity, with no options granted to directors, eligible employees, or third parties as of June 30, 2024 - The Share Option Scheme aims to provide individuals and parties working for the benefit of the Group with an opportunity to acquire equity in the Company, thereby aligning their interests with those of the Group and incentivizing them to work harder for the Group's benefit[36](index=36&type=chunk) - As of June 30, 2024, no share options had been granted to Directors, eligible employees, and other external third parties under the Share Option Scheme[36](index=36&type=chunk) [Employees and Remuneration Policy](index=18&type=section&id=%E5%83%BA%E5%91%98%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2024, the Group had 138 employees with total staff costs of HKD 8,456 thousand, and remuneration is based on experience, responsibilities, qualifications, capabilities, and operating results Employee Statistics (HKD thousands) | Indicator | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total number of employees | 138 | 147 | | Staff costs (HKD thousands) | 8,456 | 9,326 | - Remuneration is in the form of salaries and bonuses, determined based on employees' respective experience, responsibilities, qualifications, demonstrated abilities, and our operating results[37](index=37&type=chunk) [Directors' and Chief Executive's Interests in Shares, Underlying Shares and Debentures](index=19&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%91%98%E4%BA%8E%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E5%85%B3%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%80%BA%E5%88%B8%E7%9A%84%E6%9D%83%E7%9B%8A) As of June 30, 2024, Ms. Liu Li held 74.6% of shares through controlled corporations, and Mr. Xu Jiagui held 0.1% beneficial interest, with no other directors or chief executives having relevant interests Directors' and Chief Executive's Interests in Shares | Name | Capacity/Nature of Interest | Number of Issued Ordinary Shares Held | Approximate Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Ms. Liu Li | Interest in controlled corporations | 600,000,000 | 74.6% | | Mr. Xu Jiagui | Beneficial interest | 800,000 | 0.1% | - Open Venture Global Limited and LinkBest Capital Group Limited are both wholly-owned by Ms. Liu Li[39](index=39&type=chunk) [Substantial Shareholders' and Other Persons' Interests in Shares, Underlying Shares and Debentures](index=20&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E4%B8%9C%E5%8F%8A%E5%85%B6%E4%BB%96%E4%BA%BA%E5%A3%AB%E4%BA%8E%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E5%85%B3%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%80%BA%E5%88%B8%E4%B8%AD%E7%9A%84%E6%9D%83%E7%9B%8A) As of June 30, 2024, LinkBest Capital Group Limited and Open Venture Global Limited, both wholly owned by Ms. Liu Li, held 44.8% and 29.9% of the company's shares, respectively Substantial Shareholders' Interests in Shares | Shareholder Name | Capacity/Nature of Interest | Number of Issued Ordinary Shares Held | Approximate Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | LinkBest Capital Group Limited | Beneficial owner | 360,000,000 | 44.8% | | Open Venture Global Limited | Beneficial owner | 240,000,000 | 29.9% | - LinkBest and Open Venture are both wholly-owned by Ms. Liu Li[41](index=41&type=chunk) [Competing Interests](index=20&type=section&id=%E7%AB%9E%E4%BA%89%E6%9D%83%E7%9B%8A) No directors or their associates had any interests in businesses that compete or are likely to compete with the Group's operations - No Directors or their respective associates had any interests in businesses that compete or are likely to compete with the Group's business[42](index=42&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=20&type=section&id=%E8%B4%AD%E5%85%A5%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B5%8E%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AF%81%E5%88%B8) For the six months ended June 30, 2024, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the six months ended June 30, 2024, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[43](index=43&type=chunk) [Corporate Governance Practices](index=20&type=section&id=%E4%BC%81%E4%B8%9A%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A7%84) The Company adopted all Corporate Governance Code provisions, except for A.2.1, where Ms. Liu Li holds both Chairman and Chief Executive Officer roles - The Company has adopted all code provisions set out in the Corporate Governance Code, save for code provision A.2.1 of the Corporate Governance Code which has not been complied with as the roles of Chairman and Chief Executive Officer are performed by the same person, Ms. Liu Li[44](index=44&type=chunk) [Directors' Securities Transactions](index=21&type=section&id=%E8%91%A3%E4%BA%8B%E8%AF%81%E5%88%B8%E4%BA%A4%E6%98%93) For the six months ended June 30, 2024, all Directors complied with the Model Code requirements in Appendix 10 of the Listing Rules for their securities transactions - All Directors have complied with the relevant requirements under the Model Code set out in Appendix 10 to the Listing Rules regarding their securities transactions in the Company[45](index=45&type=chunk) [Changes in Directors](index=21&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%98%E5%8A%A8) Effective July 10, 2024, Mr. Xu Jiagui resigned as executive Director, and Ms. Liao Lijuan was appointed as an executive Director - Effective July 10, 2024: (1) Mr. Xu Jiagui resigned as an executive Director and (2) Ms. Liao Lijuan was appointed as an executive Director of the Company[46](index=46&type=chunk) [Audit Committee](index=21&type=section&id=%E5%AE%A1%E6%A0%B8%E5%A7%94%E5%91%98%E4%BC%9A) The Audit Committee, chaired by Dr. Lam Ka Lai and comprising three independent non-executive Directors, reviewed and approved the interim results for the six months ended June 30, 2024 - The Audit Committee currently comprises three independent non-executive Directors and is chaired by Dr. Lam Ka Lai[47](index=47&type=chunk) - The Audit Committee has reviewed the interim results for the six months ended June 30, 2024, and is of the opinion that they comply with applicable accounting standards and have made adequate disclosures[47](index=47&type=chunk)