Report Overview and Regulatory Information [Disclaimer and GEM Features](index=1&type=section&id=Disclaimer%20and%20GEM%20Features) This report includes disclaimers from the Stock Exchange regarding content accuracy and highlights GEM market's high investment risks for SMEs - The Stock Exchange of Hong Kong Limited accepts no responsibility for this announcement's content, makes no representation as to its accuracy or completeness, and disclaims any liability for losses arising from or in reliance upon it[1](index=1&type=chunk)[11](index=11&type=chunk) - The GEM market offers listing opportunities for SMEs, entailing **higher investment risks**, potential for **significant market volatility**, and no guarantee of high liquidity[10](index=10&type=chunk)[11](index=11&type=chunk) [Company Information and Announcement](index=1&type=section&id=Company%20Information%20and%20Announcement) Hang Wai Group Holdings Limited (Stock Code: 8219) released its unaudited interim results for H1 2025, complying with GEM rules and signed by the Chairman - Hang Wai Group Holdings Limited (Stock Code: **8219**) published its unaudited interim results announcement for the six months ended June 30, 2025[2](index=2&type=chunk)[3](index=3&type=chunk) - The announcement complies with the relevant requirements of the GEM Listing Rules of The Stock Exchange of Hong Kong Limited[3](index=3&type=chunk) - The Board of Directors includes Executive Directors Mr. Cheuk Sin Cheong (Chairman and Chief Executive Officer) and Ms. Au Ching Mei, and Independent Non-executive Directors Mr. Yu Sau Ning, Ms. Yu Wai Fong, and Mr. Yip Yat Lam[4](index=4&type=chunk) Company Information [Board and Committee Composition](index=5&type=section&id=Board%20and%20Committee%20Composition) The company's Board comprises two executive directors, including the Chairman and CEO, and three independent non-executive directors, with established audit, remuneration, and nomination committees - Executive Directors: Mr. Cheuk Sin Cheong (Chairman and Chief Executive Officer), Ms. Au Ching Mei[13](index=13&type=chunk) - Independent Non-executive Directors: Mr. Yu Sau Ning, Ms. Yu Wai Fong, Mr. Yip Yat Lam[14](index=14&type=chunk) - Mr. Yu Sau Ning chairs the Audit Committee and Remuneration Committee, while Mr. Cheuk Sin Cheong chairs the Nomination Committee[15](index=15&type=chunk) [Company Contact and Registration Information](index=5&type=section&id=Company%20Contact%20and%20Registration%20Information) The company secretary is Ms. Pang Yuk Fong, with Ms. Au Ching Mei and Ms. Pang Yuk Fong as authorized representatives, and its headquarters are in Hong Kong with a registered office in the Cayman Islands - The Company Secretary is Ms. Pang Yuk Fong, and the Authorized Representatives are Ms. Au Ching Mei and Ms. Pang Yuk Fong[15](index=15&type=chunk) - The headquarters and principal place of business are in Kwai Chung, New Territories, Hong Kong, with the registered office in the Cayman Islands[15](index=15&type=chunk) - Principal bankers include Bank of China (Hong Kong) Limited and Hang Seng Bank[16](index=16&type=chunk) Financial Summary [Key Financial Performance](index=6&type=section&id=Key%20Financial%20Performance) For the six months ended June 30, 2025, the company's revenue increased by 4.34% to HK$54.06 million, achieving a profit attributable to owners of HK$1.06 million, reversing the prior year's loss Key Financial Data for the Six Months Ended June 30, 2025 | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 54,062 | 51,811 | +4.34% | | Profit/(Loss) attributable to owners of the Company | 1,060 | (8,970) | Turned to profit | | Basic earnings/(loss) per share | 0.43 HK cents | (5.44) HK cents | Turned to profit | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income [Profit and Loss Overview](index=7&type=section&id=Profit%20and%20Loss%20Overview) For the six months ended June 30, 2025, the Group reported revenue of HK$54.06 million and a gross profit of HK$18.42 million, achieving a profit of HK$1.06 million, a significant improvement from the prior year's loss Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 54,062 | 51,811 | Increase | | Cost of sales | (35,645) | (34,512) | Increase | | Gross profit | 18,417 | 17,299 | Increase | | Other income, gains and losses | 2,613 | (334) | Turned to gain | | Selling and distribution expenses | (1,402) | (1,510) | Decrease | | Administrative expenses | (18,402) | (20,361) | Decrease | | Gain on disposal of a subsidiary | 1,938 | – | New | | Finance costs | (2,011) | (3,918) | Decrease | | Profit/(Loss) before tax | 1,153 | (8,824) | Turned to profit | | Income tax expense | (95) | (148) | Decrease | | Profit/(Loss) for the period | 1,058 | (8,972) | Turned to profit | | Exchange differences on translation | (4,995) | 4,740 | Turned to expense | | Total comprehensive expense for the period | (3,937) | (4,232) | Decrease | | Basic and diluted earnings/(loss) per share | 0.43 HK cents | (5.44) HK cents | Turned to earnings | Condensed Consolidated Statement of Financial Position [Balance Sheet Overview](index=8&type=section&id=Balance%20Sheet%20Overview) As of June 30, 2025, the Group's total non-current assets were HK$21.50 million, total current assets were HK$81.21 million, with net assets at HK$7.66 million, a decrease from the end of 2024 Condensed Consolidated Statement of Financial Position (as at June 30, 2025) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | **Non-current assets** | | | | | Property, plant and equipment | 11,554 | 12,513 | Decrease | | Investment properties | 9,188 | 9,188 | Stable | | Total non-current assets | 21,497 | 22,448 | Decrease | | **Current assets** | | | | | Inventories | 16,362 | 11,418 | Increase | | Trade receivables | 24,407 | 34,159 | Decrease | | Cash and bank balances | 7,150 | 16,518 | Decrease | | Total current assets | 81,205 | 95,991 | Decrease | | Assets classified as held for sale | 16,100 | 34,902 | Decrease | | **Current liabilities** | | | | | Trade and bills payables | 47,586 | 51,415 | Decrease | | Borrowings | 50,148 | 56,184 | Decrease | | Total current liabilities | 108,698 | 118,542 | Decrease | | Liabilities associated with assets classified as held for sale | 2,447 | 23,205 | Decrease | | Net assets | 7,657 | 11,594 | Decrease | Condensed Consolidated Statement of Changes in Equity [Shareholders' Equity Changes](index=10&type=section&id=Shareholders'%20Equity%20Changes) As of June 30, 2025, equity attributable to owners decreased to HK$8.55 million from HK$12.48 million at year-end 2024, despite a HK$1.06 million profit, due to negative exchange differences in the exchange reserve Condensed Consolidated Statement of Changes in Equity (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Share capital | 24,750 | 24,750 | Stable | | Share premium | 52,362 | 52,362 | Stable | | Exchange reserve | (6,888) | (2,001) | Decrease | | Accumulated losses | (67,651) | (68,711) | Decrease in loss | | Equity attributable to owners of the Company | 8,546 | 12,481 | Decrease | | Non-controlling interests | (889) | (887) | Decrease | | Total equity | 7,657 | 11,594 | Decrease | - Profit for the period was **HK$1.06 million**, a turnaround from a loss of HK$8.97 million in the prior period[21](index=21&type=chunk) - Exchange reserve deteriorated from negative **HK$2.00 million** at year-end 2024 to negative **HK$6.89 million** as of June 30, 2025, primarily due to foreign exchange differences from translating overseas operations' financial statements[21](index=21&type=chunk) Condensed Consolidated Statement of Cash Flows [Cash Flow Overview](index=11&type=section&id=Cash%20Flow%20Overview) For the six months ended June 30, 2025, net cash generated from operating activities was HK$0.242 million, with net cash outflows from investing and financing activities, resulting in a reduced cash balance Condensed Consolidated Statement of Cash Flows (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Net cash from/(used in) operating activities | 242 | (28,248) | Turned to inflow | | Net cash (used in)/from investing activities | (18) | 7,277 | Turned to outflow | | Net cash used in financing activities | (9,245) | (74) | Outflow increased | | Net decrease in cash and cash equivalents | (9,021) | (21,045) | Decrease narrowed | | Cash and cash equivalents at end of period | 1,881 | (5,281) | Turned to positive | | Cash and bank balances | 7,150 | 627 | Increase | | Bank overdrafts | (5,269) | (5,908) | Decrease | | Cash and cash equivalents as stated in the consolidated cash flow statement | 1,881 | (5,281) | Turned to positive | Notes to the Condensed Consolidated Financial Statements [Company and Accounting Policies](index=12&type=section&id=Company%20and%20Accounting%20Policies) This section details the company's registration, primary ODM watch product business, and financial statement preparation basis, confirming consistent accounting policies with no significant impact from new HKFRS standards [Company Information and Business Nature](index=12&type=section&id=Company%20Information%20and%20Business%20Nature) Hang Wai Group Holdings Limited, incorporated in the Cayman Islands in 2017 and listed on GEM in 2018, operates as an investment holding company with subsidiaries primarily engaged in ODM watch product design, development, manufacturing, and distribution globally - The Company was incorporated in the Cayman Islands on **June 12, 2017**, and listed on GEM of The Stock Exchange of Hong Kong Limited on **July 12, 2018**[23](index=23&type=chunk)[24](index=24&type=chunk) - The Company primarily engages in the design, development, manufacture, and distribution of watch products on an original design manufacturer (ODM) basis for global watch manufacturers, brand owners, and watch importers[23](index=23&type=chunk) [Basis of Preparation and Accounting Policies](index=12&type=section&id=Basis%20of%20Preparation%20and%20Accounting%20Policies) The unaudited condensed consolidated interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards, using consistent accounting policies with no significant impact from new or revised standards - The unaudited condensed consolidated interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants[25](index=25&type=chunk) - The accounting policies adopted are consistent with those applied in the financial statements for the year ended December 31, 2024[25](index=25&type=chunk) - The adoption of new and revised Hong Kong Financial Reporting Standards has no significant impact on the Group's results and financial position[25](index=25&type=chunk) [Revenue and Segment Information](index=12&type=section&id=Revenue%20and%20Segment%20Information) The Group operates a single ODM segment, with total revenue of HK$54.06 million for the six months ended June 30, 2025, primarily from overseas markets like India, Brazil, and Turkey, showing increased revenue from knocked-down kits and growth in European and South American markets [Revenue and Segment Information Details](index=13&type=section&id=Revenue%20and%20Segment%20Information%20Details) The Group operates solely in the Original Design Manufacturer (ODM) segment, with performance assessed by key operating decision-makers based on product or service type, and revenue primarily generated from India, Brazil, and Turkey - The Group operates only in the Original Design Manufacturer (ODM) operating segment[26](index=26&type=chunk) - The Group's revenue primarily originates from **India, Brazil, and Turkey**[27](index=27&type=chunk) [Revenue, Other Income, Gains and Losses Breakdown](index=13&type=section&id=Revenue,%20Other%20Income,%20Gains%20and%20Losses%20Breakdown) For the six months ended June 30, 2025, total revenue was HK$54.06 million, with knocked-down kits contributing HK$39.67 million, and other income, gains, and losses totaling HK$2.61 million, mainly from net exchange gains and rental income Revenue Sources (for the six months ended June 30) | Revenue Category | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Finished watches | 12,493 | 16,568 | Decrease | | Knocked-down kits | 39,669 | 34,018 | Increase | | Watch parts | 1,900 | 1,225 | Increase | | **Total Revenue** | **54,062** | **51,811** | **Increase** | | Interest income | 168 | 313 | Decrease | | Rental income | 413 | 192 | Increase | | Net exchange gains | 2,115 | 201 | Significant increase | | Miscellaneous income | – | 532 | Decrease | | Net loss on disposal of financial assets at fair value through profit or loss | (83) | (1,572) | Loss decreased | | **Other income, gains and losses** | **2,613** | **(334)** | **Turned to gain** | Revenue by Customer Geographical Location (for the six months ended June 30) | Region | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Asia | 26,076 | 32,536 | Decrease | | Europe | 8,672 | 5,251 | Increase | | Pacific Region | 2,930 | 3,032 | Decrease | | South America | 16,384 | 10,992 | Increase | | **Total Revenue** | **54,062** | **51,811** | **Increase** | [Subsidiary Disposal and Pre-tax Profit](index=14&type=section&id=Subsidiary%20Disposal%20and%20Pre-tax%20Profit) The Group completed the disposal of a subsidiary during the reporting period, generating a net gain of HK$1.94 million, contributing to a pre-tax profit of HK$1.15 million, a significant improvement from the prior year's loss, with income tax primarily from Hong Kong profits tax [Gain on Disposal of a Subsidiary](index=14&type=section&id=Gain%20on%20Disposal%20of%20a%20Subsidiary) The company entered into a sale and purchase agreement with Easy Investment Limited (Vendor A) and Billion Riches Limited (Purchaser A) for the disposal of a subsidiary, completed on June 23, 2025, resulting in a net gain of HK$1.94 million - The Company completed the disposal of a subsidiary, with Disposal A achieved on **June 23, 2025**[29](index=29&type=chunk)[31](index=31&type=chunk) Net Gain on Disposal of a Subsidiary | Item | Amount (HK$ thousand) | | :--- | :--- | | Consideration for Disposal A | (14,250) | | Investment in disposed company | 19,660 | | Carrying amount of assets and liabilities of disposed company as at June 23, 2024 | (3,675) | | Exchange differences arising from translation of overseas operations | 203 | | **Net gain on Disposal A** | **1,938** | [Profit Before Tax](index=15&type=section&id=Profit%20Before%20Tax) For the six months ended June 30, 2025, the Group recorded a profit before tax of HK$1.15 million, a significant improvement from the HK$8.82 million loss in the prior period, with depreciation of property, plant, and equipment at HK$2.13 million Profit Before Tax (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Profit/(Loss) before tax | 1,153 | (8,824) | | Depreciation of property, plant and equipment | 2,130 | 2,043 | [Income Tax](index=15&type=section&id=Income%20Tax) During the reporting period, income tax expense was HK$0.095 million, primarily from Hong Kong profits tax, with no PRC enterprise income tax, representing a decrease from the prior period Income Tax Expense (for the six months ended June 30) | Tax Category | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong profits tax | 95 | 115 | | PRC enterprise income tax | – | 33 | | **Total Tax Expense** | **95** | **148** | [Assets, Liabilities and EPS](index=15&type=section&id=Assets,%20Liabilities%20and%20EPS) This section details assets and liabilities classified as held for sale, EPS calculation, property, plant, and equipment movements, and aging analysis of trade receivables and payables, noting the disposal of Shenzhen Fukui Precision Technology Co Ltd and a Hong Kong property, resulting in basic EPS of 0.43 HK cents [Assets and Liabilities Classified as Held for Sale](index=15&type=section&id=Assets%20and%20Liabilities%20Classified%20as%20Held%20for%20Sale) On December 17, 2024, the Group agreed to dispose of its entire equity interest and sales loan in Shenzhen Fukui Precision Technology Co Ltd for RMB18.20 million and a Hong Kong property for HK$16.40 million, with Disposal A completed on June 23, 2025 - The Group agreed to dispose of its entire equity interest and sales loan in its wholly-owned subsidiary, Shenzhen Fukui Precision Technology Co Ltd, for a consideration of **RMB18.20 million** (approximately **HK$19.66 million**)[34](index=34&type=chunk) - The Group agreed to dispose of a property located in Hong Kong for a cash consideration of **HK$16.40 million**[34](index=34&type=chunk) Assets and Liabilities Classified as Held for Sale (HK$ thousand) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Total assets classified as held for sale | 16,100 | 34,902 | | Total liabilities associated with assets classified as held for sale | 2,447 | 23,205 | [Earnings/(Loss) Per Share](index=17&type=section&id=Earnings%2F%28Loss%29%20Per%20Share) For the six months ended June 30, 2025, profit attributable to owners was approximately HK$1.06 million, resulting in basic earnings per share of 0.43 HK cents, with diluted EPS being the same due to no potential dilutive ordinary shares - For the six months ended June 30, 2025, profit attributable to owners of the Company was approximately **HK$1.06 million**, with basic earnings per share of **0.43 HK cents**[38](index=38&type=chunk) - Diluted earnings per share is the same as basic earnings per share as there were no potential dilutive ordinary shares during these reporting periods[39](index=39&type=chunk) [Property, Plant and Equipment](index=17&type=section&id=Property,%20Plant%20and%20Equipment) During the interim period, the Group acquired approximately HK$0.13 million in property, plant, and equipment, and as of June 30, 2025, approximately HK$8.29 million of mortgaged property, plant, and equipment was pledged as collateral for bank financing - During the interim period, the Group paid approximately **HK$0.13 million** for the purchase of property, plant and equipment (2024: HK$0.06 million)[40](index=40&type=chunk) - As of June 30, 2025, approximately **HK$8.29 million** of mortgaged property, plant and equipment was pledged as collateral for the Group's bank financing[40](index=40&type=chunk) [Trade and Other Receivables, Deposits and Prepayments](index=17&type=section&id=Trade%20and%20Other%20Receivables,%20Deposits%20and%20Prepayments) As of June 30, 2025, net trade receivables decreased to HK$24.41 million from HK$34.16 million at year-end 2024, with total other receivables, deposits, and prepayments at HK$13.44 million, and the largest portion of trade receivables falling within 0 to 30 days aging Aging Analysis of Trade Receivables (net of impairment allowance) (HK$ thousand) | Aging | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 15,771 | 10,700 | | 31 to 60 days | 1,147 | 9,043 | | 61 to 90 days | 451 | 4,556 | | Over 90 days | 7,038 | 9,860 | | **Total** | **24,407** | **34,159** | - The Group generally allows trade customers a credit period of **30 to 90 days**, with longer credit periods exceeding 90 days granted to long-term relationship customers[42](index=42&type=chunk) [Trade and Other Payables, Accruals and Provisions](index=18&type=section&id=Trade%20and%20Other%20Payables,%20Accruals%20and%20Provisions) As of June 30, 2025, total trade and bills payables decreased to HK$47.59 million from HK$51.42 million at year-end 2024, with other payables and accruals totaling HK$4.53 million, and trade payables typically having a credit period of 30 to 120 days Trade and Bills Payables (HK$ thousand) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade payables | 24,422 | 22,715 | | Bills payable | 23,164 | 28,700 | | **Total** | **47,586** | **51,415** | Aging Analysis of Trade Payables (HK$ thousand) | Aging | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 7,968 | 4,742 | | 31 to 60 days | 4,981 | 5,676 | | 61 to 90 days | 6,550 | 7,131 | | 91 to 120 days | 1,571 | 1,442 | | Over 120 days | 3,352 | 3,724 | | **Total** | **24,422** | **22,715** | - The credit period for trade payables typically ranges from **30 to 120 days**, and the Group has established financial risk management policies to ensure timely payments[43](index=43&type=chunk) Management Discussion and Analysis [Business Review and Outlook](index=20&type=section&id=Business%20Review%20and%20Outlook) The Group, primarily engaged in ODM watch products, saw a 4.34% revenue increase despite an uncertain overseas market, with an improved watch industry confidence index, and plans to focus on core business, product design, and Southeast Asian market demand [Business Review](index=20&type=section&id=Business%20Review) The Group primarily designs, develops, manufactures, and distributes watch products on an Original Design Manufacturer (ODM) basis for global watch manufacturers, achieving approximately HK$54.06 million in revenue for the period, a 4.34% increase from 2024, alongside a rise in the watch industry's export confidence index - The Group primarily engages in the design, development, manufacture, and distribution of watch products on an Original Design Manufacturer (ODM) basis for global watch manufacturers, brand owners, and watch importers[45](index=45&type=chunk) - For the six months ended June 30, 2025, the Group's revenue was approximately **HK$54.06 million**, an increase of approximately **4.34%** compared to the same period in 2024[47](index=47&type=chunk) - The HKTDC Export Confidence Index for the watch industry rose by **10.8 points** from **41.3** in Q2 2024 to **52.1** in Q2 2025[47](index=47&type=chunk) [Prospects](index=20&type=section&id=Prospects) Despite an uncertain overseas business environment and US-China trade tensions, the watch industry faces innovation challenges but traditional mechanical watches retain a strong luxury market position, prompting the Group to focus on high-tech development, personalized services, and the significant demand for automatic mechanical and quartz watches in Southeast Asia - The overseas market business environment remains uncertain, with the US-China tariff trade war impacting market sentiment, though an agreement framework has been reached, leading to a more moderate market atmosphere[49](index=49&type=chunk) - The watch industry faces challenges from technological innovation, diversified consumer demands, and intensified market competition, yet the stable position of traditional mechanical watches in the luxury market presents opportunities[49](index=49&type=chunk) - The Group will closely monitor the substantial demand for automatic mechanical and quartz watches in the Southeast Asian market, continuing to focus on core business development, improving product design, and strengthening development capabilities[49](index=49&type=chunk)[50](index=50&type=chunk) [Financial Performance and Resources](index=21&type=section&id=Financial%20Performance%20and%20Resources) During the reporting period, the Group's gross profit increased by 6.47%, while administrative and finance costs significantly decreased due to reduced staff costs and bank borrowings; no interim dividend was declared, capital structure remained stable, and liquidity ratios were 0.88x (current) and 969.31% (gearing), with assets pledged as collateral [Financial Review](index=21&type=section&id=Financial%20Review) For the six months ended June 30, 2025, the Group's gross profit increased by approximately 6.47% to HK$18.42 million, administrative expenses decreased by 9.63% to HK$18.40 million due to lower staff costs, and finance costs decreased by 48.72% to HK$2.01 million due to reduced bank borrowings - The Group's gross profit was approximately **HK$18.42 million**, an increase of approximately **6.47%** compared to the same period in 2024, primarily due to increased sales[51](index=51&type=chunk) - Administrative expenses decreased by approximately **9.63%** to **HK$18.40 million**, mainly due to a reduction in staff costs[51](index=51&type=chunk) - Finance costs decreased by approximately **48.72%** to **HK$2.01 million**, primarily due to a reduction in bank borrowings[51](index=51&type=chunk) [Interim Dividend](index=21&type=section&id=Interim%20Dividend) The Board did not declare any interim dividend for the reporting period (2024: nil) - The Board did not declare any interim dividend for the reporting period (2024: nil)[52](index=52&type=chunk) [Capital Structure](index=21&type=section&id=Capital%20Structure) The company's capital structure, comprising issued share capital and reserves, remained unchanged during the reporting period, with the Board regularly reviewing it - The Company's capital structure remained unchanged during the reporting period, primarily consisting of issued share capital and reserves[53](index=53&type=chunk) [Liquidity and Financial Resources](index=21&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, the Group's cash and bank balances were approximately HK$7.15 million, with a current ratio of 0.88x and a gearing ratio of 969.31%, which the Board deems sufficient for business operations Liquidity and Financial Resources (HK$ thousand) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Cash and bank balances | 7,150 | 630 | | Current ratio | 0.88x | 1.01x | | Gearing ratio | 969.31% | 730.06% | - The Directors believe that as of the date of this interim report, the Group's financial resources are sufficient to support its business and operations[55](index=55&type=chunk) [Commitments and Pledge of Assets](index=21&type=section&id=Commitments%20and%20Pledge%20of%20Assets) The Group entered a non-legally binding MOU for a non-ferrous metal mining business acquisition and has pledged assets totaling HK$58.995 million, including property, plant, and equipment, financial assets, investment properties, and bank deposits, as collateral for bank financing - The Group entered into a non-legally binding Memorandum of Understanding with Yangshuo County Xingyuan Lead-Zinc Mine Co Ltd regarding the acquisition of a non-ferrous metal mining business[56](index=56&type=chunk) Total Pledged Assets (HK$ thousand) | Pledged Asset Category | Amount (HK$ thousand) | | :--- | :--- | | Property, plant and equipment | 8,285 | | Financial assets at fair value through profit or loss | 19,274 | | Investment properties | 25,288 | | Bank deposits | 6,148 | | **Total** | **58,995** | [Employees, Risks and Post-Reporting Events](index=22&type=section&id=Employees,%20Risks%20and%20Post-Reporting%20Events) As of June 30, 2025, the Group employed 105 staff with remuneration based on qualifications and performance, monitored foreign exchange risks without derivative or hedging activities, reported no significant contingent liabilities, and disclosed a post-reporting period property disposal [Employees and Remuneration Policies](index=22&type=section&id=Employees%20and%20Remuneration%20Policies) As of June 30, 2025, the Group had 105 employees, with salaries determined by qualifications, position, and experience, and an annual review system for performance-based adjustments - As of June 30, 2025, the Group had **105 employees** (June 30, 2024: 102 employees)[58](index=58&type=chunk) - Salaries are determined based on each employee's qualifications, position, and experience, with an annual review system to assess performance for salary adjustments, bonuses, and promotions[58](index=58&type=chunk) [Foreign Exchange Risk](index=22&type=section&id=Foreign%20Exchange%20Risk) The Group's purchases are denominated in HKD, while sales are primarily in USD, RMB, and HKD; foreign exchange risk is monitored, but no derivative or hedging activities were undertaken during the reporting period - The Group's purchases are denominated in HKD, while sales are primarily denominated in **USD, RMB, and HKD**[59](index=59&type=chunk) - During the reporting period, the Group did not engage in any derivative activities or hedging activities for foreign exchange risk[60](index=60&type=chunk) [Contingent Liabilities](index=22&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities (December 31, 2024: nil) - As of June 30, 2025, the Group had no significant contingent liabilities (December 31, 2024: nil)[61](index=61&type=chunk) [Events After Reporting Period](index=22&type=section&id=Events%20After%20Reporting%20Period) Subsequent to the reporting period, the Company and Zhihua Group Holdings Limited (Vendor B) entered into a sale and purchase agreement with Wanmao Limited (Purchaser B) for the conditional disposal of Property B - Subsequent to the reporting period, the Company and Zhihua Group Holdings Limited entered into a sale and purchase agreement with Wanmao Limited concerning the disposal of Property B[62](index=62&type=chunk) [Equity and Investment Information](index=23&type=section&id=Equity%20and%20Investment%20Information) This section details the interests of directors, chief executives, and substantial shareholders in the company's shares, noting Mr. Cheuk Sin Cheong and Ms. Au Ching Mei's 51.00% stake through Wanyi Group Limited; the company made no purchases, sales, or redemptions of listed securities, nor any material investments or disposals of subsidiaries during the period, and no share options have been granted since the 2018 scheme adoption [Directors' and Chief Executive's Interests](index=23&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests) As of June 30, 2025, Executive Directors Mr. Cheuk Sin Cheong and Ms. Au Ching Mei are deemed to have interests in 126,225,000 ordinary shares of the Company, representing 51.00% of the total shares, through their equally controlled corporate entity, Wanyi Group Limited Directors' and Chief Executive's Long Positions in the Company's Shares (as at June 30, 2025) | Director Name | Capacity/Nature of Interest | Number of Ordinary Shares Interested | Percentage of Total Shares | | :--- | :--- | :--- | :--- | | Mr. Cheuk Sin Cheong | Interest in controlled corporation | 126,225,000 | 51.00% | | Ms. Au Ching Mei | Interest in controlled corporation | 126,225,000 | 51.00% | - Mr. Cheuk Sin Cheong and Ms. Au Ching Mei legally and beneficially own equally the entire issued share capital of Wanyi Group Limited, which holds **126,225,000 shares** of the Company[64](index=64&type=chunk) [Substantial Shareholders' Interests](index=24&type=section&id=Substantial%20Shareholders'%20Interests) As of June 30, 2025, Wanyi Group Limited is a substantial shareholder, beneficially owning 126,225,000 ordinary shares, representing 51.00% of the Company's total shares, excluding directors or the chief executive Substantial Shareholders' Long Positions in the Company's Shares (as at June 30, 2025) | Shareholder Name | Capacity/Nature of Interest | Number of Ordinary Shares Interested | Percentage of Total Shares | | :--- | :--- | :--- | :--- | | Wanyi Group Limited | Beneficial interest | 126,225,000 | 51.00% | [Securities Transactions and Material Investments](index=24&type=section&id=Securities%20Transactions%20and%20Material%20Investments) During the reporting period, neither the Company nor its subsidiaries purchased, sold, or redeemed any of its listed securities, nor were there any material investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures, with no other significant investment or capital asset plans for the coming year - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[67](index=67&type=chunk) - During the reporting period, the Company had no material investments, material acquisitions, or disposals of subsidiaries, associates, and joint ventures[68](index=68&type=chunk) - Except as disclosed in this interim report, the Group has no other material investment or capital asset plans for the coming year[69](index=69&type=chunk) [Share Option Scheme](index=24&type=section&id=Share%20Option%20Scheme) The Company's share option scheme, adopted on June 20, 2018, for a 10-year term, aims to reward and retain high-quality employees, with no options granted since its adoption, and 100,000,000 shares available for grant as of June 30, 2025, representing 10% of issued shares - The Company's share option scheme was approved and adopted by shareholders on **June 20, 2018**, with a validity period of **10 years**[70](index=70&type=chunk) - The purpose of the share option scheme is to provide incentives or rewards for participants' contributions to the Group and/or enable the Group to recruit and retain high-quality employees[70](index=70&type=chunk) - No share options have been granted since the scheme's adoption on June 20, 2018, and as of June 30, 2025, the total number of shares available for grant under the scheme is **100,000,000 shares**, representing **10%** of the Company's issued shares[72](index=72&type=chunk) [Corporate Governance](index=25&type=section&id=Corporate%20Governance) During the reporting period, no directors, management shareholders, or substantial shareholders engaged in competing businesses or conflicts of interest; the company complied with GEM Listing Rules' Corporate Governance Code, despite the Chairman and CEO roles being combined, and adopted a code of conduct for directors' securities transactions, with the Audit Committee reviewing financial information [Competition and Conflicts of Interest](index=25&type=section&id=Competition%20and%20Conflicts%20of%20Interest) During the reporting period, no directors, management shareholders, substantial shareholders, or their associates engaged in any business competing with the Group or had any other conflicts of interest - During the reporting period, no directors, management shareholders, substantial shareholders, or any of their respective associates engaged in any business competing or likely to compete with the Group, nor did they have any other conflicts of interest with the Group[73](index=73&type=chunk) [Corporate Governance Code](index=25&type=section&id=Corporate%20Governance%20Code) During the reporting period, the Company complied with the Corporate Governance Code provisions in Appendix C1 of the GEM Listing Rules, with the Board deeming the combined roles of Chairman and Chief Executive Officer, held by Mr. Cheuk Sin Cheong, to be in the Group's best interest - During the reporting period, the Company complied with the code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules[74](index=74&type=chunk) - The roles of Chairman and Chief Executive Officer are performed by Mr. Cheuk Sin Cheong, an arrangement the Board believes benefits the Group's business, strengthens stable and consistent leadership, and is in the Group's best interest[74](index=74&type=chunk) [Code of Conduct for Securities Transactions by Directors](index=26&type=section&id=Code%20of%20Conduct%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted a code of conduct for directors' securities transactions, with terms no less exacting than the required standards set out in the GEM Listing Rules, and directors complied with this code during the reporting period - The Company has adopted a code of conduct for securities transactions by directors, with terms no less exacting than the required standards set out in the GEM Listing Rules[75](index=75&type=chunk) - During the reporting period, the directors complied with the required standards and the code of conduct for securities transactions by directors[75](index=75&type=chunk) [Audit Committee](index=26&type=section&id=Audit%20Committee) The Company has established an Audit Committee, chaired by Mr. Yu Sau Ning, which has reviewed the Group's unaudited consolidated results for the reporting period and confirmed their preparation in accordance with applicable accounting standards and GEM Listing Rules, with adequate disclosure - The Company has established an Audit Committee in compliance with the GEM Listing Rules and the Corporate Governance Code, with Mr. Yu Sau Ning as Chairman[76](index=76&type=chunk) - The Audit Committee has reviewed the Group's unaudited consolidated results for the reporting period and is of the opinion that they were prepared in accordance with applicable accounting standards and the GEM Listing Rules, and that adequate disclosure has been made[76](index=76&type=chunk) [Forward-Looking Statements](index=26&type=section&id=Forward-Looking%20Statements) This interim report contains forward-looking statements regarding the Group's financial condition, operating results, and business, which are based on various assumptions and are not guarantees of future performance, being subject to risks, uncertainties, and assumptions - This interim report contains forward-looking statements regarding the Group's financial condition, operating results, and business[77](index=77&type=chunk) - These statements are based on various assumptions about the Group's current and future business strategies and its future operating environment, are not guarantees of future performance, and are subject to certain risks, uncertainties, and assumptions[77](index=77&type=chunk)

Core Viewpoint - The company expects a significant improvement in financial performance, projecting a profit of at least HKD 500,000 for the six months ending June 30, 2025, compared to a loss of approximately HKD 8.97 million for the same period in 2024 [1] Financial Performance - The anticipated profit for the six months ending June 30, 2025, is at least HKD 500,000 [1] - The loss for the six months ending June 30, 2024, is projected to be around HKD 8.97 million [1] - The board attributes the substantial improvement in financial performance to proceeds from the sale of a Chinese subsidiary and reduced interest expenses following the repayment of bank loans [1]

Core Viewpoint - Hengwei Group Holdings (08219) expects to achieve a profit attributable to shareholders of not less than approximately HKD 500,000 for the six months ending June 30, 2025, compared to a loss of approximately HKD 8.97 million for the six months ending June 30, 2024 [1] Financial Performance - The significant improvement in the group's financial performance is primarily attributed to the proceeds from the sale of a Chinese subsidiary in June 2025 [1] - Additionally, the reduction in interest expenses following the repayment of the group's bank loans has contributed to the improved financial results [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 表 明 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。 HANVEY GROUP HOLDINGS LIMITED 恆偉集團控股有限公司 （股份代號：8219） （於開曼群島註冊成立的有限公司） 盈利預告 本 公 告 由 恆 偉 集 團 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GEM證 券 上 市 規 則（「GEM上市規則」）第17.10(2)(a) 條及香港法例第571章證券及期貨條例第XIVA部 內 幕 消 息 條 文（定 義 見GEM上 市 規 則）作 出。 本 公 司 董 事（「董 事」）會（「董事會」）欣 然 知 會 本 公 司 股 東（「股 東」）及 有 意 投 資 者， 根據董事會對本集團截至2025年6月30日止六個月的未經審核綜合管理賬目以 及 董 事 會 目 ...

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 表 明 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。 HANVEY GROUP HOLDINGS LIMITED 恆偉集團控股有限公司 （股份代號：8219） （於開曼群島註冊成立的有限公司） 董事會會議日期 恆 偉 集 團 控 股 有 限 公 司（「本公司」，連 同 其 附 屬 公 司 統 稱「本集團」）董 事（「董 事」） 會（「董事會」）謹 此 宣 佈，董 事 會 會 議 將 於2025年8月26日（星 期 二）舉 行，藉 以（其 中 包 括）考 慮 及 批 准 本 集 團 截 至2025年6月30日止六個月的未經審核中期業績及 其 發 佈，並 考 慮 建 議 派 發 中 期 股 息（如 有）。 香 港，2025年8月12日 於 本 公 告 日 期，執 行 董 事 為 卓 善 章 先 生 及 歐 靜 美 女 士，M.H.；以 及 獨 立 非 ...

FF301 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: 恆偉集團控股有限公司 (於開曼群島註冊成立的有限公司) 呈交日期: 2025年8月6日 I. 法定/註冊股本變動 本月底法定/註冊股本總額： HKD 100,000,000 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) | 08219 | 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 | | | | 247,500,000 | | 0 | | 247,500,000 | | 增加 / 減少 (-) | | | | 0 | | 0 ...

Group 1 - The Hang Seng Index rose by 1.74% to close at 22,504.68 points on May 2 [1] - Hengwei Group Holdings (08219.HK) closed at HKD 0.19 per share, up 33.8%, with a trading volume of 2.89 million shares and a turnover of HKD 552,400, showing a volatility of 32.39% [1] - Over the past month, Hengwei Group Holdings has seen a cumulative decline of 47.41%, while year-to-date, it has increased by 19.33%, outperforming the Hang Seng Index by 10.27% [1] Group 2 - For the fiscal year ending December 31, 2024, Hengwei Group Holdings reported total revenue of HKD 128 million, a decrease of 25.3% year-on-year [1] - The company recorded a net profit attributable to shareholders of -HKD 17.81 million, an increase of 2.71% year-on-year, with a gross margin of 29.67% and a debt-to-asset ratio of 92.44% [1] - Currently, there are no institutional investment ratings for Hengwei Group Holdings [1] Group 3 - Hengwei Group Holdings Limited, established in 1986, is a watch manufacturer headquartered in Hong Kong, with production facilities in China [2] - The company's primary business involves designing, developing, manufacturing, and distributing watch products based on ODM standards, offering a variety of watches including those with metal and non-metal straps, as well as mechanical and quartz movements [2] - The company's clients are globally distributed, particularly in Hong Kong, Brazil, the United Arab Emirates, Turkey, and the European Union, with competitive advantages seen as key to maintaining market position and capitalizing on expected growth in the global watch market [2] Group 4 - The textile and apparel industry has an average TTM price-to-earnings ratio of -5.95 times, with a median of -0.42 times [1] - Hengwei Group Holdings has a price-to-earnings ratio of -1.83 times, ranking 105th in the industry [1] - Other companies in the industry include FAST RETAIL-DRS (06288.HK) at 0.36 times, Zhejiang Yong'an (08211.HK) at 1.34 times, Daren International (01957.HK) at 3.06 times, Shanshan Brand (01749.HK) at 3.5 times, and Qili Industrial Group (01731.HK) at 3.63 times [1]

Financial Performance - The group's revenue for the year ended December 31, 2024, was approximately HKD 138.70 million, a decrease of about 25.30% compared to approximately HKD 185.67 million for the year ended December 31, 2023[21][24]. - Sales cost decreased by approximately HKD 44.80 million or 31.47% from HKD 142.35 million for the year ended December 31, 2023, to approximately HKD 97.55 million for the year ending December 31, 2024[25]. - Gross profit decreased by approximately HKD 2.17 million or about 5.01% from approximately HKD 43.32 million for the year ended December 31, 2023, to approximately HKD 41.15 million for the year ending December 31, 2024[26]. - Administrative expenses decreased by approximately HKD 11.54 million or about 23.74% from approximately HKD 48.60 million for the year ended December 31, 2023, to approximately HKD 37.06 million for the year ending December 31, 2024[28]. - The company recorded a loss before tax of approximately HKD 19.07 million for the year ending December 31, 2024, an increase of about 1.76% compared to approximately HKD 18.74 million for the year ended December 31, 2023[30]. - Cash and bank balances as of December 31, 2024, were approximately HKD 16.52 million, down from HKD 71.74 million in 2023[36]. - The company's current ratio as of December 31, 2024, was 0.92, compared to 1.02 as of December 31, 2023[36]. - The company's debt-to-equity ratio as of December 31, 2024, was approximately 817.34%, up from 446.54% in 2023[37]. Business Strategy and Operations - The company plans to adopt a prudent approach, strictly control operating costs, and focus on improving operational efficiency and profitability[15][23]. - The company continues to invest in high-tech development and personalized services to maintain stable growth in the watch industry[16]. - The outlook for overseas markets remains uncertain, with risks of economic slowdown or recession, particularly in Europe and the United States[16]. - The company aims to focus on core business development, improve product design, and enhance development capabilities for long-term shareholder returns[17]. - The company will closely monitor market trends to provide designs that meet customer and market needs, especially in the Southeast Asian market[16]. - The company acknowledges the challenges posed by technological innovation, diverse consumer demands, and intense market competition in the watch industry[16]. Shareholder and Capital Management - The company has entered into a non-binding memorandum of understanding regarding the acquisition of a non-ferrous metal mining business[38]. - The company successfully placed all unallocated rights shares at a price of HKD 0.10 per share, raising funds for operational needs[47]. - The total amount raised from the rights issue (including compensation arrangements) is approximately HKD 8.25 million, with a net amount of approximately HKD 7.47 million after expenses[48]. - Approximately HKD 5.98 million of the net proceeds will be used to repay bank loans, and approximately HKD 1.49 million will be allocated for general working capital[50]. - The company has fully utilized the net proceeds from the rights issue and placement, with no remaining unused amounts[50]. - The board does not recommend a final dividend for the year ending December 31, 2024, consistent with the previous year where no dividend was paid[68]. Corporate Governance - The company has confirmed compliance with the non-competition agreement by its controlling shareholders since the listing date, with no violations reported[66]. - The board consists of five members, including two executive directors and three independent non-executive directors[75]. - The company has adopted a board diversity policy, considering various factors such as gender, age, and professional experience to achieve diversity among board members[78]. - The company has maintained compliance with the corporate governance code, except for a reasonable deviation regarding the separation of roles between the chairman and CEO[69]. - The independent non-executive directors have confirmed no knowledge of any breaches of the non-competition agreement by controlling shareholders[66]. - The board is responsible for overseeing the company's business, strategic decisions, and performance[72]. - The board consists of 5 directors, with 3 male and 2 female members, achieving gender diversity[80]. - The company has established an audit committee comprising 3 independent non-executive directors to oversee financial reporting and risk management[86]. - The remuneration committee held one meeting to review the remuneration structure for directors and provide recommendations[87]. - The nomination committee conducted one meeting to assess the board's composition and evaluate the independence of non-executive directors[88]. - The company has a clear division of roles between the chairman and the CEO, with the current arrangement deemed beneficial for effective management[82]. - The board is committed to promoting gender diversity at all levels, including senior management[80]. - The audit committee held four meetings during the reporting period to review accounting standards and financial reporting[86]. - The company has complied with GEM listing rules by appointing at least three independent non-executive directors[84]. - The board will continue to review its composition and diversity regularly to ensure effectiveness[80]. Environmental, Social, and Governance (ESG) Practices - The company emphasizes a sustainable dividend policy, balancing shareholder interests with prudent capital management[103]. - The board will consider various factors, including financial performance and economic conditions, when recommending any dividend payments[104]. - The company has established effective communication channels with shareholders, including an annual general meeting to discuss important resolutions[106]. - The company has a whistleblowing and anti-corruption policy in place, detailed in the 2023 Environmental, Social, and Governance report[109]. - The board consists of experienced members, including the chairman with over 36 years in the watch industry, focusing on strategy and product development[111]. - The company aims to become a leading manufacturer of high-quality watches in China and globally, focusing on sustainable practices and providing reasonable returns to shareholders[183]. - The board emphasizes the importance of resource management, occupational safety, and compliance with environmental, social, and governance (ESG) regulations to enhance corporate image and competitiveness[185]. - The company maintains the same ESG governance structure as the previous reporting period, with the board responsible for setting goals and monitoring performance related to ESG issues[186]. - The company actively engages with stakeholders to identify and address relevant ESG matters, utilizing various communication channels[189]. - An annual materiality assessment is conducted to understand stakeholder expectations regarding the company's ESG performance[191]. - The company is committed to minimizing its carbon footprint, energy consumption, and the impact of climate change as part of its sustainable development strategy[195]. - The Shenzhen factory operates under multiple environmental protection laws and regulations to ensure compliance and sustainability[195]. - The board regularly reviews and discusses the establishment and progress of annual environmental goals[185]. - The company aims to create long-term value for stakeholders through a strict corporate governance framework[185]. - The company has established a comprehensive stakeholder list and engages in continuous communication to ensure effective stakeholder participation[190]. - The company has not experienced any significant violations of China's environmental protection laws and regulations during the 2024 reporting period[196]. - Management conducts an annual review of environmental issues and regularly monitors for any new laws and regulations[197]. - The company emphasizes environmental management and corporate social responsibility, focusing on compliance with local environmental laws and regulations[198]. - During the reporting period, there were no significant issues related to emissions of harmful and non-harmful waste or water pollution violations[198]. - Air pollutants generated by the company during the 2024 reporting period include sulfur oxides, nitrogen oxides, and particulate matter, primarily from vehicle usage[199]. - The company aims to minimize adverse environmental impacts by using unleaded gasoline and electricity for all vehicles and machinery[200]. - Air pollutants and greenhouse gas emissions are sourced from direct emissions from mobile combustion sources (Scope 1) and indirect emissions from purchased electricity (Scope 2)[200]. Market and Competitive Environment - The Hong Kong Trade Development Council's export confidence index rose from 35.0 in Q4 2023 to 50.3 in Q4 2024, indicating improved business performance among exporters[14][22]. - The watch industry's confidence index increased from 47.5 in Q4 2023 to 49.1 in Q4 2024, reflecting a slight improvement in market sentiment[14][22]. - The company reported an increase in sales, new orders, and procurement activities, contributing to the rise in exporter confidence[14][22]. - The competitive environment in the watch manufacturing industry in China is intense, with over 1,000 market participants, impacting pricing and demand significantly[143]. - The company faces potential increases in operational costs due to changes in laws and regulations in the jurisdictions where it operates, which may affect its growth and expansion capabilities[144]. - The company's operations in China are heavily influenced by the economic, political, and legal developments in the region, which could impact its financial performance[145]. - The Chinese government's economic policies and interventions may affect the company's ability to maintain growth and expansion strategies[146]. - The company acknowledges the risks associated with the implementation of new laws and regulations that could impose additional costs and limit its operational capabilities[148]. - Financial risks are detailed in the consolidated financial statements, indicating potential vulnerabilities in the company's financial health[149].

Financial Performance - For the fiscal year ending December 31, 2024, the company reported total revenue of HKD 138,695,000, a decrease of 25.3% compared to HKD 185,667,000 in 2023[5] - The cost of sales for the same period was HKD 97,549,000, resulting in a gross profit of HKD 41,146,000, which is a decline of 5.0% from HKD 43,315,000 in 2023[5] - The company incurred a net loss of HKD 19,233,000 for the year, slightly improved from a loss of HKD 19,932,000 in the previous year[5] - Total comprehensive income for the year included other comprehensive income of HKD 5,497,000, compared to a loss of HKD 932,000 in 2023[6] - The basic and diluted loss per share for the year was HKD 10.00, compared to HKD 11.98 in 2023, indicating a slight improvement[6] - The company reported a loss attributable to owners of approximately HKD 19,229,000 for the year ending December 31, 2024[14] - The company reported a net loss of HKD 11,948,000 in other income and expenses for 2024, compared to a loss of HKD 254,000 in 2023[23] - The group recorded a pre-tax loss of approximately HKD 19.07 million for the year ending December 31, 2024, an increase of about 1.76% compared to approximately HKD 18.74 million for the year ending December 31, 2023[53] - Total comprehensive expenses attributable to owners of the company decreased by approximately 33.67% to about HKD 13.73 million for the year ending December 31, 2024[55] Assets and Liabilities - The company's total assets decreased to HKD 130,893,000 in 2024 from HKD 134,072,000 in 2023, reflecting a reduction of 2.4%[7] - Current liabilities were reported at HKD 141,747,000, down from HKD 130,875,000 in 2023, indicating an increase of 8.5%[8] - The company's cash and bank balances significantly decreased to HKD 16,518,000 from HKD 71,744,000, a decline of 77.0%[7] - The company’s equity attributable to owners decreased to HKD 12,481,000 from HKD 18,681,000, a drop of 33.3%[8] - The group's current liabilities amounted to approximately HKD 10,854,000[14] - The group's bank overdrafts and borrowings were approximately HKD 2,873,000 and HKD 56,184,000, respectively, with cash and bank balances of approximately HKD 16,518,000[14] - The total borrowings decreased from HKD 120,219 thousand in 2023 to HKD 59,057 thousand in 2024[40] - The bank overdraft decreased from HKD 3,738 thousand in 2023 to HKD 2,873 thousand in 2024[40] Revenue Breakdown - Revenue for the year ended December 31, 2024, was HKD 138,695,000, a decrease of 25.3% from HKD 185,667,000 in 2023[22] - The revenue breakdown by region shows a significant decline in Asia from HKD 146,148,000 in 2023 to HKD 95,566,000 in 2024, a drop of 34.5%[20] - Major customer B contributed HKD 64,134,000 in 2024, up 33.1% from HKD 48,226,000 in 2023[21] Cost Management - The company is implementing an operational plan to control costs and generate sufficient cash flow to meet current and future obligations[14] - The company plans to adopt a cautious approach and continue strict cost control to improve operational efficiency and profitability[46] - Total employee costs decreased to HKD 17,704,000 in 2024 from HKD 21,918,000 in 2023, reflecting a reduction of approximately 19.8%[8] - Administrative expenses decreased by approximately HKD 11.54 million or 23.74% to about HKD 37.06 million for the year ending December 31, 2024[51] - Financial costs reduced by approximately HKD 1.58 million or 17.32% to about HKD 7.54 million for the year ending December 31, 2024, primarily due to the repayment of bank loans[52] - Sales and distribution expenses decreased by approximately 10.05% to about HKD 3.67 million for the year ended December 31, 2024, down from approximately HKD 4.08 million for the previous year[50] Future Plans and Strategies - The company plans to focus on market expansion and new product development to enhance future performance[5] - The company plans to enhance liquidity and reduce borrowings through a transaction pending approval at a special shareholders' meeting[17] - The company plans to focus on core business development and improve product design and development capabilities to maximize long-term returns for shareholders[57] Shareholder Information - The company has no plans to pay dividends to ordinary shareholders for the year 2024, consistent with 2023[28] - The board does not recommend the payment of a final dividend for the year ending December 31, 2024 (2023: zero)[93] - The company received valid applications for a total of 53,490,250 shares in the rights issue, representing approximately 64.8% of the total shares offered[71] - The total amount raised from the rights issue, including the compensation arrangement, was approximately HKD 8.25 million, with a net amount of approximately HKD 7.47 million after expenses[72] - Approximately HKD 5.98 million of the net proceeds will be used to repay bank loans, and approximately HKD 1.49 million will be allocated for general working capital[72] Corporate Governance - The company has complied with the corporate governance code as of December 31, 2024, except for reasonable deviations as detailed[94] - The chairman and CEO roles are held by the same individual, Mr. Cheung, due to his extensive experience since 1986, which the board believes benefits the company's operations during its rapid development phase[95] - The company has adopted a code of conduct for directors' securities transactions, confirming compliance with trading regulations as of December 31, 2024[97] Audit and Reporting - The independent auditor, Tianjian International, has reviewed the consolidated financial statements for the fiscal year ending December 31, 2024, but does not provide any assurance on the performance announcement[100] - The annual performance announcement and annual report for the fiscal year ending December 31, 2024, will be published on the company's and the stock exchange's websites[101]

[Company Information](index=3&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) The company's board includes executive directors Mr. Cheuk Sin Cheung (Chairman and CEO) and Ms. Au Ching Mei, along with independent non-executive directors - The board of directors includes executive directors Mr. Cheuk Sin Cheung (Chairman and Chief Executive Officer) and Ms. Au Ching Mei, along with independent non-executive directors Mr. Yu Sau Ning, Ms. Yu Wai Fong, Dr. Liu Ngai Wing (resigned on June 13, 2024), and Mr. Yip Yat Lam (appointed on June 13, 2024)[6](index=6&type=chunk) - The company's stock code is **8219**, and its website is www.hanveygroup.com.hk[6](index=6&type=chunk) [Overview](index=5&type=section&id=%E6%A6%82%E8%A6%81) The Group experienced a significant decline in revenue and a shift from profit to loss during the reporting period Key Financial Indicators for the Six Months Ended June 30, 2024 | Indicator | June 30, 2024 (HK$ thousand) | June 30, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 51,811 | 127,122 | -59.24% | | (Loss)/Profit Attributable to Owners of the Company | (8,970) | 1,318 | Shifted from profit to loss | | Basic (Loss)/Earnings Per Share | (5.44) HK cents | 0.80 HK cents | Shifted from profit to loss | - During the reporting period, Hanvey Group's revenue significantly decreased, shifting from profit to loss, with basic earnings per share turning into a loss[7](index=7&type=chunk)[9](index=9&type=chunk)[22](index=22&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) This section presents the Group's condensed consolidated financial performance, position, equity changes, and cash flows for the reporting period [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=6&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%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) During the reporting period, Group revenue significantly decreased by 59.24% to HK$51.81 million, leading to a 50.30% reduction in gross profit and a shift from profit to a loss of HK$8.972 million Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 51,811 | 127,122 | -59.24% | | Gross Profit | 17,299 | 34,811 | -50.30% | | (Loss)/Profit Before Tax | (8,824) | (83) | Loss widened | | (Loss)/Profit for the Period | (8,972) | 1,235 | Shifted from profit to loss | | Basic (Loss)/Earnings Per Share | (5.44) HK cents | 0.80 HK cents | Shifted from profit to loss | - The loss attributable to owners of the Company was approximately **HK$8.97 million**, compared to a profit of approximately **HK$1.32 million** in the same period last year[7](index=7&type=chunk)[9](index=9&type=chunk)[22](index=22&type=chunk) [Condensed Consolidated Statement of Financial Position](index=7&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2024, the Group's total assets slightly decreased from the end of 2023, with a significant reduction in net current assets and net assets, indicating financial pressure Key Data from Condensed Consolidated Statement of Financial Position | Indicator | June 30, 2024 (HK$ thousand) | December 31, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Non-current Assets | 65,346 | 68,522 | -3,176 | | Current Assets | 127,370 | 134,072 | -6,702 | | Current Liabilities | 126,235 | 130,875 | -4,640 | | Net Current Assets | 1,135 | 3,197 | -2,062 | | Net Assets | 13,566 | 17,798 | -4,232 | - Trade receivables significantly increased from **HK$17.599 million** as of December 31, 2023, to **HK$30.499 million** as of June 30, 2024[10](index=10&type=chunk)[24](index=24&type=chunk) - Loans from related companies substantially increased from **HK$1.800 million** as of December 31, 2023, to **HK$18.567 million** as of June 30, 2024[10](index=10&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=9&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) As of June 30, 2024, equity attributable to owners decreased from HK$18.681 million to HK$14.451 million, primarily due to a HK$8.970 million loss for the period, partially offset by a HK$4.740 million increase in exchange reserve Summary of Condensed Consolidated Statement of Changes in Equity | Indicator | June 30, 2024 (HK$ thousand) | December 31, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Share Capital | 16,500 | 16,500 | 0 | | Share Premium | 53,080 | 53,080 | 0 | | Exchange Reserve | 2,323 | (2,417) | +4,740 | | Retained Profits/(Accumulated Losses) | (58,452) | (49,482) | -8,970 | | Equity Attributable to Owners of the Company | 14,451 | 18,681 | -4,230 | - A loss of **HK$8.970 million** was recorded for the period, compared to a profit of **HK$1.318 million** in the same period last year[12](index=12&type=chunk) - Exchange reserve increased by **HK$4.740 million**, turning from negative to positive due to exchange differences from translating financial statements of overseas operations[12](index=12&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=10&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) During the reporting period, net cash outflow from operating activities increased, investment activities shifted from net outflow to net inflow, and net cash outflow from financing activities significantly decreased, resulting in a negative cash and cash equivalents balance at period-end Summary of Condensed Consolidated Statement of Cash Flows | Indicator | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (28,248) | (22,557) | -5,691 | | Net Cash From Investing Activities | 7,277 | 66 | +7,211 | | Net Cash (Used in)/From Financing Activities | (74) | 23,546 | -23,620 | | Net (Decrease)/Increase in Cash and Cash Equivalents | (21,045) | 1,055 | -22,100 | | Cash and Cash Equivalents at End of Period | (5,281) | 11,358 | -16,639 | - Cash and bank balances at period-end were **HK$627 thousand**, but bank overdrafts amounted to **HK$5,908 thousand**, resulting in a net cash and cash equivalents of **negative HK$5,281 thousand**[14](index=14&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed notes explaining the basis of preparation, accounting policies, and specific financial items within the condensed consolidated financial statements [1. Company Information](index=11&type=section&id=1.%20%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) Hanvey Group was incorporated in the Cayman Islands in 2017, listed on GEM in Hong Kong in 2018, and primarily engages in ODM design, manufacturing, and distribution of watch products, with Man Yi Group Limited as its ultimate holding company - The Company is an investment holding company, and its subsidiaries are principally engaged in the design and development, manufacture, and distribution of watch products on an original design manufacturer (ODM) basis for global watch manufacturers, brand owners, and watch importers[15](index=15&type=chunk) - The Company's shares were listed on GEM of The Stock Exchange of Hong Kong Limited on **July 12, 2018**[15](index=15&type=chunk) [2. Basis of Preparation and Accounting Policies](index=11&type=section&id=2.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E5%8F%8A%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) These interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards, consistent with the accounting policies used in the 2023 annual financial statements, with no significant impact from new or revised standards - The unaudited condensed consolidated interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants[16](index=16&type=chunk) - The accounting policies adopted are consistent with those applied in the financial statements for the year ended December 31, 2023, and new and revised standards have no significant impact on the Group's results and financial position[16](index=16&type=chunk) [3. Revenue and Segment Information](index=11&type=section&id=3.%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group primarily operates a single ODM watch manufacturing and trading segment, with revenue mainly from Asia, South America, and Europe, noting a significant decline in the Asian market - The Group currently operates only one original design manufacturer (ODM) operating segment, primarily engaged in the manufacture and trading of watches[17](index=17&type=chunk) Revenue by Geographical Location of Customers | Geographical Location | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Asia | 32,536 | 110,780 | -78,244 | | Europe | 5,251 | 5,313 | -62 | | Pacific Region | 3,032 | 1,606 | +1,426 | | South America | 10,992 | 9,423 | +1,569 | | **Total** | **51,811** | **127,122** | **-75,311** | [4. Revenue, Other Income, Gains and Losses](index=12&type=section&id=4.%20%E6%94%B6%E7%9B%8A%E3%80%81%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E3%80%81%E6%94%B6%E7%9B%8A%E5%8F%8A%E虧%E6%90%8D) Total Group revenue significantly decreased during the reporting period, mainly due to a sharp drop in sales of finished watches, while other income, gains, and losses shifted from positive to negative, primarily impacted by increased losses from financial assets at fair value through profit or loss Revenue Components | Item | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Finished Watches | 16,568 | 91,914 | -75,346 | | Loose Parts Kits | 34,018 | 31,975 | +2,043 | | Watch Components | 1,225 | 3,233 | -2,008 | | **Total Revenue** | **51,811** | **127,122** | **-75,311** | Other Income, Gains and Losses | Item | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Interest Income | 313 | 579 | -266 | | Rental Income | 192 | 182 | +10 | | Net Exchange (Loss)/Gain | 201 | (414) | +615 | | Miscellaneous Income | 532 | 0 | +532 | | Government Grant Income | 0 | 212 | -212 | | Net (Loss)/Gain on Disposal of Financial Assets at Fair Value Through Profit or Loss | (1,572) | (88) | -1,484 | | **Total** | **(334)** | **471** | **-805** | [5. Profit Before Tax](index=13&type=section&id=5.%20%E9%99%A4%E7%A8%85%E5%89%8D%E6%BA%A2%E5%88%A9) During the reporting period, depreciation expense for property, plant, and equipment was HK$2.043 million, a decrease from the prior year Depreciation of Property, Plant and Equipment | Indicator | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Depreciation | 2,043 | 2,645 | -602 | [6. Income Tax](index=13&type=section&id=6.%20%E6%89%80%E5%BE%97%E7%A8%85) Total income tax expense for the reporting period was HK$148 thousand, primarily comprising Hong Kong profits tax and PRC enterprise income tax, a slight decrease from the prior year Components of Income Tax Expense | Item | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Hong Kong Profits Tax | 115 | 86 | +29 | | PRC Enterprise Income Tax | 33 | 83 | -50 | | **Total** | **148** | **169** | **-21** | [7. (Loss)/Earnings Per Share](index=13&type=section&id=7.%20%E6%AF%8F%E8%82%A1%EF%BC%88%E虧%E6%90%8D%EF%BC%89%E2%88%95%E6%BA%A2%E5%88%A9) Basic loss per share for the reporting period was 5.44 HK cents, compared to basic earnings per share of 0.80 HK cents in the prior year, primarily due to a HK$8.97 million loss attributable to owners, with diluted loss per share being the same due to no potential dilutive ordinary shares (Loss)/Earnings Per Share | Indicator | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Basic (Loss)/Earnings Per Share | (5.44) HK cents | 0.80 HK cents | - The loss attributable to owners of the Company for the reporting period was approximately **HK$8.97 million**, compared to a profit of approximately **HK$1.32 million** in the same period last year[22](index=22&type=chunk) [8. Property, Plant and Equipment](index=13&type=section&id=8.%20%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99) During the reporting period, the Group's expenditure on property, plant, and equipment increased, and as of period-end, approximately HK$45.28 million of mortgaged property, plant, and equipment was pledged as security for bank financing Purchases of Property, Plant and Equipment | Indicator | Six Months Ended June 30, 2024 (HK$ million) | Six Months Ended June 30, 2023 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Purchases | 0.06 | 0.03 | +0.03 | - As of June 30, 2024, mortgaged property, plant, and equipment with a carrying amount of approximately **HK$45.28 million** were pledged as security for the Group's general banking facilities[23](index=23&type=chunk) [9. Trade and Other Receivables, Deposits and Prepayments](index=14&type=section&id=9.%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E3%80%81%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E3%80%81%E6%8C%89%E9%87%91%E5%8F%8A%E9%A0%90%E4%BB%98%E6%AC%BE) As of June 30, 2024, trade receivables significantly increased, primarily concentrated in the 0-30 day aging category, indicating higher sales or slower collection, while prepayments for raw materials decreased Trade and Other Receivables | Item | June 30, 2024 (HK$ thousand) | December 31, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Trade Receivables (net of allowance) | 30,499 | 17,599 | +12,900 | | Other Receivables, Deposits and Prepayments | 7,400 | 9,405 | -2,005 | Aging Analysis of Trade Receivables (net of impairment allowance) | Aging | June 30, 2024 (HK$ thousand) | December 31, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | 0 to 30 days | 22,757 | 7,198 | +15,559 | | 31 to 60 days | 4,810 | 5,970 | -1,160 | | 61 to 90 days | 386 | 1,415 | -1,029 | | Over 90 days | 2,546 | 3,016 | -470 | | **Total** | **30,499** | **17,599** | **+12,900** | - The Group allows credit periods of **30 to 90 days** to trade customers, with longer credit periods exceeding **90 days** granted to long-term customers[24](index=24&type=chunk) [10. Trade and Bills Payables, Other Payables and Accruals](index=15&type=section&id=10.%20%E8%B2%BF%E6%98%93%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%87%89%E4%BB%98%E7%A5%A8%E6%93%9A%E3%80%81%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%87%89%E8%A8%88%E8%B2%BB%E7%94%A8) As of June 30, 2024, total trade and bills payables decreased, with a notable reduction in bills payable, and trade payables typically have credit terms of 30 to 120 days Trade and Bills Payables | Item | June 30, 2024 (HK$ thousand) | December 31, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Trade Payables | 21,865 | 23,924 | -2,059 | | Bills Payables | 22,656 | 28,415 | -5,759 | | **Total** | **44,521** | **52,339** | **-7,818** | Aging Analysis of Trade Payables | Aging | June 30, 2024 (HK$ thousand) | December 31, 2023 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | 0 to 30 days | 7,345 | 3,973 | +3,372 | | Over 120 days | 1,028 | 5,057 | -4,029 | - All bills payable are due within **30 to 120 days**, with bills payable aged **0 to 30 days** decreasing from **HK$8,717 thousand** to **HK$3,828 thousand**[28](index=28&type=chunk) [11. Related Party Transactions](index=16&type=section&id=11.%20%E9%97%9C%E8%81%AF%E6%96%B9%E4%BA%A4%E6%98%93) During the reporting period, there were no rental expense transactions between the Group and Mr. Cheuk Sin Cheung, compared to HK$360 thousand in the prior year Summary of Related Party Transactions | Name of Related Party | Nature of Transaction | Six Months Ended June 30, 2024 (HK$ thousand) | Six Months Ended June 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | :--- | | Mr. Cheuk Sin Cheung | Rental Expense | 0 | 360 | [Management Discussion and Analysis](index=17&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) This section provides an overview of the Group's business performance, financial review, and future outlook, including discussions on market conditions and operational strategies [Business Review](index=17&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) During the reporting period, Group revenue significantly decreased by 59.24% to HK$51.81 million, primarily impacted by a decline in the watch industry confidence index, prompting the Group to continue prudent cost control and operational efficiency improvements - The Group is principally engaged in the design and development, manufacture, and distribution of watch products on an original design manufacturer (ODM) basis for global watch manufacturers, brand owners, and watch importers[30](index=30&type=chunk) Revenue Changes | Indicator | Six Months Ended June 30, 2024 (HK$ million) | Six Months Ended June 30, 2023 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 51.81 | 127.12 | -59.24% | - The HKTDC Export Confidence Index shows that the confidence index for the watch industry decreased from **48.8** in Q2 2023 to **41.3** in Q2 2024 (a drop of **7.5**), reflecting a pessimistic industry outlook[30](index=30&type=chunk) [Prospects](index=17&type=section&id=%E5%89%8D%E6%99%AF) The Group anticipates an uncertain overseas market environment, with economic slowdowns and rising funding costs from Fed rate hikes posing challenges to exports, yet significant demand for automatic mechanical and quartz watches in Southeast Asia persists, prompting close market observation and product design improvements - The uncertain overseas market environment, with risks of economic slowdown or recession, poses the greatest challenge to export performance in the coming months[30](index=30&type=chunk) - Continued interest rate hikes by the Federal Reserve lead to increased funding costs, potentially causing ongoing volatility in the stock market[30](index=30&type=chunk) - Demand for automatic mechanical and quartz watches in the Southeast Asian market remains substantial, and the Group will closely monitor market trends and provide designs suitable for customers[30](index=30&type=chunk) [Financial Review](index=18&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) During the reporting period, the Group's gross profit decreased by 50.30% due to lower sales, while selling and distribution expenses, administrative expenses, and finance costs all declined, primarily driven by reductions in freight, staff costs, and bank borrowings Changes in Key Financial Expenses | Indicator | Six Months Ended June 30, 2024 (HK$ million) | Six Months Ended June 30, 2023 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 17.30 | 34.81 | -50.30% | | Selling and Distribution Expenses | 1.51 | 2.03 | -25.62% | | Administrative Expenses | 20.36 | 27.46 | -25.86% | | Finance Costs | 3.92 | 4.38 | -10.50% | - The decrease in selling and distribution expenses was primarily due to a reduction in freight and transportation expenses[31](index=31&type=chunk) - The decrease in administrative expenses was mainly due to a reduction in staff costs[31](index=31&type=chunk) - The decrease in finance costs was primarily due to a reduction in bank borrowings[31](index=31&type=chunk) [Interim Dividend](index=18&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board did not declare an interim dividend for the reporting period, consistent with the same period in 2023 - The Board did not declare an interim dividend for the reporting period (2023: nil)[32](index=32&type=chunk) [Capital Structure](index=18&type=section&id=%E8%B3%87%E6%9C%AC%E6%9E%B6%E6%A7%8B) The Company's capital structure remained unchanged during the reporting period, primarily consisting of issued share capital and reserves, with the Board regularly reviewing the capital structure - The Company's capital structure remained unchanged during the reporting period, primarily comprising issued share capital and reserves[33](index=33&type=chunk) [Liquidity and Financial Resources](index=18&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) As of June 30, 2024, the Group's cash and bank balances significantly decreased, the current ratio declined, and the gearing ratio substantially increased to 730.06%, indicating heightened liquidity pressure Liquidity and Financial Resources Indicators | Indicator | June 30, 2024 | June 30, 2023 | Change | | :--- | :--- | :--- | :--- | | Cash and Bank Balances (HK$ million) | 0.63 | 11.36 | -94.45% | | Current Ratio (times) | 1.01 | 1.14 | -0.13 | | Gearing Ratio (%) | 730.06% | 257.30% | +472.76% | - The Directors believe that, as of the date of this interim report, the Group's financial resources are sufficient to support its business and operations[34](index=34&type=chunk) [Commitments](index=18&type=section&id=%E6%89%BF%E6%93%94) As of June 30, 2023, the Group had no capital commitments - As of **June 30, 2023**, the Group had no capital commitments[35](index=35&type=chunk) [Pledge of Assets](index=18&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) At the end of the reporting period, approximately HK$127.083 million of the Group's assets, including property, plant and equipment, financial assets at fair value through profit or loss, investment properties, and bank deposits, were pledged to banks as security for banking facilities Total Pledged Assets | Item | Amount (HK$ thousand) | | :--- | :--- | | Property, Plant and Equipment | 45,279 | | Financial Assets at Fair Value Through Profit or Loss | 18,907 | | Investment Properties | 11,375 | | Bank Deposits | 51,522 | | **Total** | **127,083** | [Employees and Remuneration Policy](index=19&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2024, the Group's employee count decreased to 102, with salaries determined based on qualifications, position, and experience, and an annual review system for performance evaluation Number of Employees | Date | Number of Employees | | :--- | :--- | | June 30, 2024 | 102 | | June 30, 2023 | 116 | - The Company determines salaries based on each employee's qualifications, position, and experience, with an annual review system serving as the basis for salary increments, bonuses, and promotions[37](index=37&type=chunk) [Foreign Exchange Risk](index=19&type=section&id=%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA) The Group's purchases are denominated in HKD, while sales are primarily in USD, RMB, and HKD, and during the reporting period, the Group did not engage in any derivative instruments or hedging activities to manage foreign exchange risk - The Group's purchases are denominated in **HKD**, while sales are primarily denominated in **USD**, **RMB**, and **HKD**[38](index=38&type=chunk) - During the reporting period, the Group did not engage in any derivative activities or enter into any hedging activities for foreign exchange risk[38](index=38&type=chunk) [Contingent Liabilities](index=19&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2024, the Group had no significant contingent liabilities - As of **June 30, 2024**, the Group had no significant contingent liabilities (December 31, 2023: nil)[39](index=39&type=chunk) [Events After Reporting Period](index=19&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E4%BB%B6) The Company proposes a rights issue on the basis of one rights share for every two existing shares held by qualifying shareholders at a subscription price of HK$0.10 per share, aiming to raise up to approximately HK$8.25 million - The Company proposes to issue up to **82,500,000 rights shares** at a subscription price of **HK$0.10** per rights share on the basis of one rights share for every two existing shares held by qualifying shareholders at the close of business on the record date[40](index=40&type=chunk) - The rights issue aims to raise gross proceeds of up to approximately **HK$8.25 million** (assuming full subscription of the rights issue)[40](index=40&type=chunk) [Directors' and Chief Executive's Interests](index=19&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%AC%8A%E7%9B%8A) This section discloses the interests of directors and major shareholders in the Company's and its associated corporations' shares, with Mr. Cheuk Sin Cheung and Ms. Au Ching Mei jointly holding 56.36% of the Company's shares through Man Yi Group Limited [Directors' and Chief Executive's Interests and/or Short Positions in the Shares, Underlying Shares and Debentures of the Company or its Associated Corporations](index=19&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E6%9C%80%E9%AB%98%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%88%96%E5%85%B6%E7%9B%B8%E8%81%AF%E6%B3%95%E5%9C%98%E4%B9%8B%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%82%B5%E5%88%B8%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E2%88%95%E6%B7%A1%E5%80%89) This sub-section details the long positions held by directors in the Company's shares, primarily through controlled corporations Directors' Long Positions in the Shares of the Company | Name of Director | Capacity/Nature of Interest | Number of Ordinary Shares in which Long Position is Held | Percentage of Total Shares | | :--- | :--- | :--- | :--- | | Mr. Cheuk Sin Cheung | Interest in a controlled corporation | 93,000,000 | 56.36% | | Ms. Au Ching Mei | Interest in a controlled corporation | 93,000,000 | 56.36% | - **93,000,000** shares of the Company are registered in the name of Man Yi Group Limited, whose entire issued share capital is legally and beneficially owned in equal shares by Mr. Cheuk Sin Cheung and Ms. Au Ching Mei[42](index=42&type=chunk) [Substantial Shareholders' Interests and/or Short Positions in the Shares and Underlying Shares of the Company](index=21&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B9%8B%E8%82%A1%E4%BB%BD%E5%8F%8A%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E2%88%95%E6%B7%A1%E5%80%89) This sub-section outlines the long positions held by substantial shareholders in the Company's shares Substantial Shareholders' Long Positions in the Shares of the Company | Name | Capacity/Nature of Interest | Number of Ordinary Shares in which Long Position is Held | Percentage of Total Shares | | :--- | :--- | :--- | :--- | | Man Yi Group Limited | Beneficial interest | 93,000,000 | 56.36% | [Purchase, Sale or Redemption of the Company's Listed Securities](index=21&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[45](index=45&type=chunk) [Material Investments and Plans for Capital Assets](index=21&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E8%A8%88%E5%8A%83) During the reporting period, the Group made no material investments, acquisitions, or disposals of subsidiaries, associates, and joint ventures, and has no other significant investment or capital asset plans for the coming year [Material Investments Held, Material Acquisitions or Disposals of Subsidiaries, Associates and Joint Ventures](index=21&type=section&id=%E6%89%80%E6%8C%81%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E3%80%81%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E6%88%96%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E3%80%81%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%90%88%E7%87%9F%E4%BC%81%E6%A5%AD) During the reporting period, the Company had no material investments, acquisitions, or disposals of subsidiaries, associates, and joint ventures - During the reporting period, the Company had no material investments, material acquisitions, or disposals of subsidiaries, associates, and joint ventures[45](index=45&type=chunk) [Future Plans for Material Investments or Capital Assets](index=21&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E4%B9%8B%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) Apart from what is disclosed in this interim report, the Group has no other significant investment or capital asset plans for the next year - Save as disclosed in this interim report, the Group has no other material investment or capital asset plans for the next year[46](index=46&type=chunk) [Share Option Scheme](index=21&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The Company adopted a share option scheme in 2018 to incentivize employees and attract talent, valid for 10 years, with total shares granted not exceeding 10% of issued shares, and no options granted or outstanding as of June 30, 2024 - The Share Option Scheme was approved and adopted by shareholders on **June 20, 2018**, with a validity period of **10 years**, aiming to provide incentives and attract high-caliber employees[47](index=47&type=chunk) - The total number of shares involved in share options granted under the scheme shall not exceed **10%** of the issued shares at any time[48](index=48&type=chunk) - No share options have been granted since the adoption of the scheme, and as of **June 30, 2024**, the Company had no outstanding share options under the Share Option Scheme[48](index=48&type=chunk) [Corporate Governance](index=22&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Group generally complied with the Corporate Governance Code during the reporting period, though the roles of Chairman and CEO are held by the same person, which the Board believes is in the Group's best interest, and the Audit Committee has reviewed the interim results for compliance with accounting standards [Competition and Conflicts of Interest](index=22&type=section&id=%E7%AB%B6%E7%88%AD%E5%8F%8A%E5%88%A9%E7%9B%8A%E8%A1%9D%E7%AA%81) During the reporting period, no directors, management shareholders, or substantial shareholders engaged in any business competing or potentially competing with the Group, nor did they have any other conflicts of interest - During the reporting period, none of the Company's Directors, management shareholders, or substantial shareholders, or any of their respective associates, engaged in any business that competes or may compete with the Group's business or had any other conflicts of interest with the Group[49](index=49&type=chunk) [Corporate Governance Code](index=22&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) The Company complied with the Corporate Governance Code provisions, except for the combined roles of Chairman and Chief Executive Officer, which the Board deems beneficial for consistent leadership and the Group's best interests - The Company has complied with the code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules, except for the roles of Chairman and Chief Executive Officer being performed by the same individual (Mr. Cheuk Sin Cheung)[50](index=50&type=chunk) - The Board believes that Mr. Cheuk Sin Cheung serving concurrently as Chairman of the Board and Chief Executive Officer of the Company is beneficial to the Group's business, strengthens stable and consistent leadership, and is in the best interests of the Group[50](index=50&type=chunk) [Code of Conduct for Securities Transactions by Directors](index=23&type=section&id=%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E4%B9%8B%E6%93%8D%E5%AE%88%E5%AE%88%E5%89%87) The Company adopted a code of conduct for directors' securities transactions, no less exacting than the GEM Listing Rules, and confirmed directors' compliance during the reporting period - The Company has adopted a code of conduct for securities transactions by Directors, the terms of which are no less exacting than the required standard of dealings set out in Rules 5.48 to 5.67 of the GEM Listing Rules[51](index=51&type=chunk) - Following specific enquiries, the Company confirmed that the Directors have complied with the required standard of dealings and the code of conduct for securities transactions by Directors during the reporting period[51](index=51&type=chunk) [Audit Committee](index=23&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee's primary duties include recommending external auditors, reviewing financial statements, advising on financial reporting, and overseeing internal controls, having reviewed the unaudited interim results and confirmed their compliance with applicable accounting standards and GEM Listing Rules - The primary duties of the Audit Committee are mainly to make recommendations to the Board on the appointment and removal of external auditors, review financial statements and related information, advise on financial reporting procedures, and oversee the Group's internal control procedures[52](index=52&type=chunk) - The Audit Committee has reviewed the Group's unaudited consolidated results for the reporting period and is of the opinion that they were prepared in accordance with applicable accounting standards and the GEM Listing Rules, and that adequate disclosures have been made[52](index=52&type=chunk) [Forward-Looking Statements](index=23&type=section&id=%E5%89%8D%E7%9E%BB%E6%80%A7%E9%99%B3%E8%BF%B0) This interim report contains forward-looking statements regarding the Group's future financial condition, operating results, and business, which are based on various assumptions and subject to risks, uncertainties, and assumptions, and are not guarantees of future performance - This interim report contains forward-looking statements regarding the Group's financial condition, operating results, and business[53](index=53&type=chunk) - These statements reflect the Group's views on future events, are not guarantees of future performance, and are subject to certain risks, uncertainties, and assumptions[53](index=53&type=chunk)