Core Viewpoint - Yonglianfeng Holdings (09882) expects a significant decline in net profit for the mid-2025 period, projecting a drop of approximately 85% to 95% compared to the unaudited net profit of about HKD 9.9 million for the same period in 2024 [1] Summary by Relevant Categories Financial Performance - The company anticipates a decrease in net profit primarily due to a reduction in gross margin attributed to changes in product mix, despite an increase in sales of new machinery and minerals (which have lower profit margins) [1] - There is an expected fair value loss recognized on financial assets measured at fair value through profit or loss [1] - Increased sales and distribution expenses are projected for the mid-2025 period, including but not limited to freight costs [1]

Core Viewpoint - The company, Yonglianfeng Holdings (09882), anticipates a significant decline in net profit for the mid-2025 period, projecting a drop of approximately 85% to 95% compared to the unaudited net profit of about 9.9 million HKD for the same period in 2024 [1] Summary by Relevant Categories Profit Forecast - The expected net profit for mid-2025 is projected to decrease by approximately 85% to 95% from the unaudited net profit of around 9.9 million HKD in 2024 [1] Factors Contributing to Profit Decline - The reduction in net profit is primarily attributed to a decrease in gross margin due to changes in the product mix, with an increase in sales of new machinery and minerals (which have lower profit margins) and a decrease in sales of rotary bearings (which have higher profit margins) [1] - The company has also reported fair value losses on financial assets measured at fair value through profit or loss [1] - Additionally, there is an increase in selling and distribution expenses for the mid-2025 period, including but not limited to freight costs [1]

Core Viewpoint - The company expects a significant decline in its unaudited net profit from continuing operations for the mid-2025 period, projecting a drop of approximately 85% to 95% compared to the unaudited net profit of about 9.9 million HKD from the same period last year [1] Group 1 - The anticipated decrease in net profit is primarily attributed to a reduction in gross margin due to changes in the product mix, with an increase in sales of lower-margin machinery and minerals, while sales of higher-margin slewing bearings have decreased [1] - The company has recognized fair value losses on financial assets measured at fair value through profit or loss [1] - There has been an increase in selling and distribution expenses during the mid-2025 period, including but not limited to freight costs [1]

盈利預警 本 公 告 乃 由 本公 司 根 據 上 市 規 則 第 13.09 條 以 及 證 券 及 期 貨 條 例 第 XIVA 部 項 下 的內幕消息條文刊發。 董事會謹此知會本公司股東及潛在投資者，根據董事會對本集團未經審核綜合 管理賬目的初步評估以及董事會目前可得的資料，預期本集團於二零二五年中 期期間的純利將較截至二零二四年六月三十日止六個月的未經審核純利約9.9百 萬港元下跌約85 %至95 %。 香 港 交 易 及 結 算 所 有 限 公 司 及 香 港 聯 合 交 易 所 有 限 公 司 對 本 公 告 的 內 容 概 不 負 責，對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部 或任何部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 BEST LINKING GROUP HOLDINGS LIMITED 永 聯 豐 集 團 控 股 有 限 公 司 （於 開 曼 群 島 註 冊 成 立 的 有 限 公 司） （股 份 代 號：9882） 本公司董事（「董事」）會（「董事會」）謹此知會本公司股東及潛在投資者，根據對本 集團截至二零二五年六月三十日止六個月（「二零二 ...

Financial Performance - Revenue for FY2024 decreased by 20.3% to HK$114,644,000 from HK$143,779,000 in FY2023[12] - Gross profit for FY2024 was HK$26,269,000, down 56.7% from HK$60,789,000 in FY2023[12] - Profit before taxation for FY2024 was HK$8,313,000, a decline of 70.4% compared to HK$28,103,000 in FY2023[12] - Total comprehensive income for FY2024 was HK$3,770,000, significantly lower than HK$20,095,000 in FY2023, marking an 81.2% decrease[12] - Net profit attributable to equity holders for the year was approximately HK$6.3 million, representing a decrease of approximately 71.5% from HK$22.0 million in 2023[28] - Basic and diluted earnings per share were both approximately HK0.8 cents, down from HK2.8 cents in 2023[28] - The Group's revenue decreased by 20.3% to HK$114.6 million for the Reporting Period, compared to HK$143.8 million for FY2023[78] Revenue Breakdown - The Group's slewing ring revenue from ODM decreased by 58.3% to HK$23,629,000 in FY2024 from HK$56,718,000 in FY2023[15] - Revenue from slewing rings decreased by approximately HK$43.2 million, from HK$70.3 million in FY2023 to HK$27.1 million in the Reporting Period, representing a decrease of 61.5%[85] - Revenue from mechanical parts and components decreased by approximately HK$7.3 million, from HK$23.6 million in FY2023 to HK$16.3 million in the Reporting Period, a decline of 30.9%[93] - Revenue from sales of machineries amounted to approximately HK$46.9 million in the Reporting Period, a decrease of approximately HK$3.0 million or 6.0% from HK$49.9 million in FY2023[99] - Revenue from mineral sales amounted to approximately HK$24.4 million during the Reporting Period, compared to nil in FY2023, representing 21.3% of total revenue[109] Market and Economic Conditions - The economic recovery in certain countries is expected to be slow, with global growth anticipated to be less than moderate before gradually recovering in the second half of 2024[33] - Economic development in China is impacted by factors such as defaults by property developers and a slump in the property market, affecting the expected economic rebound[33] - The persistent decline in market demand from Hong Kong and ASEAN regions negatively impacted revenue due to economic downturns and uncertainties[52] - The economic recovery in Hong Kong and the PRC is expected to be below expectations in 2024 due to various challenges, including property market issues[47] Strategic Initiatives - The Group has expanded its product offerings to include minerals and related products in early 2024[20] - The Group plans to expand its product coverage to include minerals and related products, responding to customer inquiries for a wider scope of offerings[53] - The Group has established a supply network for minerals excavated from mines, aiming to enhance business and profitability by selling directly to mine owners[53] - The Group's sourcing business, including minerals, is anticipated to continue growing as it captures market opportunities[40] - The Group aims to enhance production capacity by acquiring and replacing machinery and equipment at its production facilities in Dongguan, PRC[187] Corporate Governance and Management - The Company successfully transferred its listing from GEM to the Main Board of the Stock Exchange in 2023, enhancing its corporate profile and recognition among investors and customers[178] - Mr. Chen Longbin was appointed as an executive director on March 12, 2019, after initially joining the group in November 2005[200] - The company aims to enhance its human resources management under Mr. Chen Longbin's leadership[200] - The group is committed to strategic growth and operational efficiency in its business segments[200] Financial Position and Cash Flow - As of December 31, 2024, the Group's cash and cash equivalents increased by approximately 24.3% to HK$74.6 million, compared to HK$60.0 million as of December 31, 2023[132][135] - The current ratio as of December 31, 2024, was 4.8 times, down from 8.2 times as of December 31, 2023[136][140] - Bank borrowings increased to approximately HK$9.9 million as of December 31, 2024, compared to HK$8.1 million as of December 31, 2023, resulting in a gearing ratio of 9.3%[136][140] - The Group's total current assets were approximately HK$145.1 million as of December 31, 2024, compared to HK$140.0 million as of December 31, 2023[136][140] Operational Developments - The Group has increased its workforce in the sales department to strengthen sales support and hired a consultant for web design and promotion strategies[151] - The Group has collaborated with service providers to develop new automation equipment and enhance existing equipment, including the installation of robotic arms and acquisition of an automatic packaging machine[154] - The ERP system development is underway, with modules in use since late 2024, and testing will continue in 2025[154] Dividends and Shareholder Returns - The Board does not recommend the payment of a final dividend for the year 2024 due to the challenges faced[29] - No interim dividend was paid during the year, and the Board does not recommend the payment of a final dividend for the Reporting Period[177]

Financial Performance - Revenue for the year ended December 31, 2024, was HKD 114,644,000, a decrease of 20.3% compared to HKD 143,779,000 in 2023[2] - Gross profit for the same period was HKD 26,269,000, down 56.8% from HKD 60,789,000[2] - Operating profit decreased by 71.4% to HKD 7,846,000 from HKD 27,393,000[2] - Net profit attributable to shareholders was HKD 6,290,000, a decline of 71.5% from HKD 22,039,000[2] - Basic and diluted earnings per share were HKD 0.8, down 71.4% from HKD 2.8[2] - The company reported a comprehensive income of HKD 3,770,000 for the year, down from HKD 20,095,000 in the previous year[5] - The company's profit before tax for the year 2024 is HKD 8,313,000, compared to HKD 28,103,000 for 2023, indicating a significant decrease[28] - The profit attributable to equity holders was approximately HKD 6.3 million in the reporting period, down from HKD 22.0 million in the fiscal year 2023, with adjustments for non-recurring listing expenses and donations[103] Assets and Liabilities - Total current assets increased by 3.6% to HKD 145,088,000 from HKD 139,994,000[3] - Total assets rose by 1.9% to HKD 167,967,000 compared to HKD 164,857,000[3] - Total equity decreased by 8.3% to HKD 135,430,000 from HKD 147,660,000[3] - Total liabilities increased to HKD 32,537,000 from HKD 17,197,000, showing a significant rise of about 89.5%[9] - The company's equity decreased from HKD 147,660,000 to HKD 135,430,000, a decline of approximately 8.25%[9] - Cash and cash equivalents amounted to HKD 59,452,000, up from HKD 54,891,000, representing an increase of approximately 8.5%[9] Revenue Breakdown - Revenue from Hong Kong for the year 2024 was HKD 59,402,000, an increase from HKD 32,204,000 in 2023[19] - Revenue from the Philippines decreased to HKD 22,978,000 in 2024 from HKD 33,637,000 in 2023[19] - Revenue from Singapore also saw a decline, dropping to HKD 19,200,000 in 2024 from HKD 44,043,000 in 2023[19] - Revenue from China was HKD 4,785,000 in 2024, slightly up from HKD 4,261,000 in 2023[19] - Revenue from procurement business decreased by approximately HKD 6.0 million, primarily due to reduced sales to customers in the Philippines[78] - Revenue from machinery parts sold to the Philippines market dropped to approximately HKD 4.1 million, down from HKD 11.6 million in the fiscal year 2023[78] Expenses and Costs - The cost of sales increased by approximately 6.5% from HKD 82.99 million in the fiscal year 2023 to HKD 88.38 million in the fiscal year 2024, primarily due to changes in product mix[100] - Administrative expenses decreased by approximately 43.0% from HKD 30.7 million in the fiscal year 2023 to about HKD 17.5 million in the fiscal year 2024, attributed to reduced donation expenses and listing costs[102] - The income tax expense for the current period rose significantly from HKD 1,255 thousand in 2022 to HKD 6,161 thousand in 2023, indicating an increase of about 390.5%[24] Strategic Plans and Future Outlook - The company plans to focus on new product development and market expansion strategies moving forward[4] - Future guidance indicates a focus on enhancing operational efficiency and exploring potential mergers and acquisitions[10] - The company aims to leverage new technologies to improve its manufacturing processes and product offerings[11] - The company plans to extend its product procurement business to minerals and related products, responding to increased customer inquiries since its listing on the main board[56] - The company has established a supply network for minerals from its own mining operations to sell to customers, aiming to enhance its business foundation and profitability[56] Market Conditions and Challenges - The decline in revenue was primarily due to decreased demand in the Hong Kong and ASEAN markets, influenced by economic slowdown and uncertainty[55] - The company has been facing intense market competition and economic uncertainty, emphasizing the importance of exploring new business opportunities[56] - The company anticipates a slow recovery in global growth by the second half of 2024, remaining below medium levels[94] Shareholder Information - The board does not recommend the payment of a final dividend for the reporting period, with a proposed payment of HKD 0.04 per share for the previous year totaling HKD 16 million[128] - The annual general meeting of shareholders is scheduled for June 6, 2025[133] Corporate Governance - The company emphasizes the importance of good corporate governance for its success and intends to comply with all applicable corporate governance codes[149] - The Audit Committee, established on October 21, 2019, consists of three independent non-executive directors and has reviewed the annual performance for the year ending December 31, 2024[150]

[Corporate Information](index=2&type=section&id=Corporate%20Information) [Corporate Structure and Key Personnel](index=2&type=section&id=Corporate_Structure) The report details the company's board members, composition and chairs of various committees (Audit, Remuneration, Nomination, Corporate Governance), and key partners including legal advisors and auditors, along with registered and principal places of business - Executive Directors include Mr. Chan Yuk Bun, Chairman and Chief Executive Officer, and Mr. Chan Lung Bun[2](index=2&type=chunk) - The Audit Committee is chaired by Mr. Chan Hung Chun, the Remuneration Committee by Ms. Tam Ho Ting, the Nomination Committee by Mr. Chan Yuk Bun, and the Corporate Governance Committee by Mr. Chan Lung Bun[2](index=2&type=chunk) - The company's auditor is PricewaterhouseCoopers[6](index=6&type=chunk) [Interim Condensed Consolidated Financial Statements](index=5&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) [Statement of Comprehensive Income](index=5&type=section&id=Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2024, the Group experienced a significant decline in revenue and profitability, with total revenue decreasing by **40.6%** and profit for the period falling from **HK$14.756 million** to **HK$9.949 million** Metric (Six Months Ended June 30) | Metric (Six Months Ended June 30) | 2024 (HK$ '000) | 2023 (HK$ '000) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Revenue** | 45,999 | 77,437 | -40.6% | | **Gross Profit** | 18,031 | 31,838 | -43.4% | | **Operating Profit** | 10,843 | 18,343 | -40.9% | | **Profit for the Period** | 9,949 | 14,756 | -32.6% | | **Basic Earnings Per Share (HK cents)** | 1.2 | 1.8 | -33.3% | - Due to the depreciation of RMB against HKD, the company recorded a **HK$1.84 million** foreign currency translation difference loss, leading to a total comprehensive income for the period of **HK$8.109 million**[11](index=11&type=chunk) [Statement of Financial Position](index=7&type=section&id=Statement%20of%20Financial%20Position) As of June 30, 2024, the Group's total assets decreased primarily due to lower cash and cash equivalents, while total liabilities significantly reduced due to full repayment of bank borrowings, maintaining a stable overall financial structure Balance Sheet Item | Balance Sheet Item | June 30, 2024 (HK$ '000) | December 31, 2023 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | 145,559 | 164,857 | -11.7% | | Non-current Assets | 22,276 | 24,863 | -10.4% | | Current Assets | 123,283 | 139,994 | -11.9% | | **Total Liabilities** | 5,790 | 17,197 | -66.3% | | Bank Borrowings | - | 8,093 | -100% | | **Total Equity** | 139,769 | 147,660 | -5.3% | | **Cash and Cash Equivalents** | 38,748 | 54,891 | -29.4% | [Statement of Changes in Equity](index=9&type=section&id=Statement%20of%20Changes%20in%20Equity) In the first half of 2024, the Group's total equity decreased from **HK$147.7 million** to **HK$139.8 million**, primarily due to **HK$16 million** in dividends paid and **HK$1.84 million** in exchange losses, despite a **HK$9.95 million** profit for the period - Opening total equity was **HK$147,660 thousand**[16](index=16&type=chunk) - Profit for the period increased equity by **HK$9,949 thousand**[16](index=16&type=chunk) - Dividends declared during the period of **HK$16,000 thousand** reduced equity[16](index=16&type=chunk) - Foreign currency translation differences resulted in other comprehensive loss of **HK$1,840 thousand**[16](index=16&type=chunk) - Closing total equity was **HK$139,769 thousand**[16](index=16&type=chunk) [Statement of Cash Flows](index=11&type=section&id=Statement%20of%20Cash%20Flows) In the first half of 2024, the Group's cash and cash equivalents decreased by **HK$16.072 million**, primarily due to a significant **HK$24.247 million** net cash outflow from financing activities for bank loan repayments and dividend payments, despite **HK$8.304 million** net cash inflow from operating activities Cash Flow Item (Six Months Ended June 30) | Cash Flow Item (Six Months Ended June 30) | 2024 (HK$ '000) | 2023 (HK$ '000) | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | 8,304 | 26,253 | | **Net Cash Used in Investing Activities** | (129) | (777) | | **Net Cash Used in Financing Activities** | (24,247) | (54) | | **Net (Decrease)/Increase in Cash and Cash Equivalents** | (16,072) | 25,422 | | **Cash and Cash Equivalents at End of Period** | 38,748 | 75,954 | - Cash outflow from financing activities primarily included **HK$8.093 million** for bank loan repayments and **HK$16 million** for dividend payments[22](index=22&type=chunk) [Notes to the Financial Information](index=13&type=section&id=Notes%20to%20the%20Financial%20Information) [Note 1: General Information](index=13&type=section&id=Note_1_General_Information) The company, incorporated in the Cayman Islands, transitioned its shares from GEM to the Main Board of HKEX on September 28, 2023, operating as an investment holding company with subsidiaries primarily engaged in manufacturing and trading slewing bearings, mechanical products, and parts - The company is primarily engaged in the manufacturing and trading of slewing bearings, mechanical products, and mechanical parts[23](index=23&type=chunk) - The company's shares were transferred from GEM to the Main Board of the Stock Exchange on **September 28, 2023**[23](index=23&type=chunk) [Note 4: Revenue and Segment Information](index=16&type=section&id=Note_4_Revenue_and_Segment_Information) Management considers the Group as a single operating segment, "manufacturing and trading a range of mechanical products and mechanical parts," with all revenue recognized at a point in time from contracts with customers - Management considers the Group to have only one operating segment: manufacturing and trading mechanical products and parts[36](index=36&type=chunk) - All revenue is recognized at a point in time[37](index=37&type=chunk) [Note 8: Dividends](index=19&type=section&id=Note_8_Dividends) The Board does not recommend the payment of any interim dividend for the reporting period ended June 30, 2024 - The Board does not recommend the payment of an interim dividend for the reporting period[49](index=49&type=chunk)[51](index=51&type=chunk) [Note 10: Trade Receivables](index=20&type=section&id=Note_10_Trade_Receivables) As of June 30, 2024, total trade receivables were **HK$41.449 million**, with receivables over three months significantly increasing to **HK$19.422 million**, representing **46.8%** of the total, indicating a potential extension of collection cycles, while sales credit terms are typically **60 to 120 days** Aging Analysis | Aging Analysis | June 30, 2024 (HK$ '000) | December 31, 2023 (HK$ '000) | | :--- | :--- | :--- | | Within 30 days | 16,169 | 38,104 | | 31 to 60 days | 288 | 2,274 | | 61 to 90 days | 5,570 | 1,901 | | Over 3 months | 19,422 | 2,012 | | **Total** | **41,449** | **44,291** | [Management Discussion and Analysis](index=23&type=section&id=Management%20Discussion%20and%20Analysis) [Business and Financial Review](index=23&type=section&id=Business_and_Financial_Review) In the first half of 2024, the Group's total revenue declined by **40.6%** to **HK$46 million** due to global economic uncertainties and high interest rates, with core businesses experiencing downturns, but the new mineral (nickel ore) trading business contributed **HK$8.6 million** in revenue, and reduced administrative expenses, partly due to lower one-off listing costs, mitigated the net profit decline [Business Overview](index=23&type=section&id=Business_Overview) As a leading Chinese slewing bearing manufacturer, the Group's revenue declined by **40.6%** in H1 2024 due to macroeconomic impacts and slowed construction in Hong Kong and ASEAN, prompting expansion into mineral and related product trading to seek new growth - In the first half of 2024, due to local and global economic uncertainties, the Group's revenue decreased by **40.6%** to **HK$46 million**, with gross profit at **HK$18 million**[79](index=79&type=chunk) - Key reasons for the revenue decline include reduced local construction activity, slower global demand for slewing bearings and other products, and customer project delays[79](index=79&type=chunk) - To address challenges, the Group expanded into mineral and related product trading in early 2024, aiming to create new business synergies and profit growth points[82](index=82&type=chunk)[83](index=83&type=chunk) [Revenue Analysis by Product](index=26&type=section&id=Revenue_Analysis_by_Product) In H1 2024, the Group's total revenue decreased by **40.6%**, with "Slewing Bearings" revenue sharply declining by **58.3%**, and "Mechanical Parts" and "Machinery" also falling by **43.4%** and **44.5%** respectively, while the newly expanded "Minerals" (nickel ore) business contributed **HK$8.601 million**, accounting for **18.7%** of total revenue Revenue Category (Six Months Ended June 30) | Revenue Category (Six Months Ended June 30) | 2024 (HK$ '000) | 2023 (HK$ '000) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Slewing Bearings** | 17,298 | 41,521 | -58.3% | | **Mechanical Parts** | 8,689 | 15,351 | -43.4% | | **Machinery** | 11,411 | 20,565 | -44.5% | | **Minerals (Nickel Ore)** | 8,601 | - | N/A | | **Total** | **45,999** | **77,437** | **-40.6%** | - The decline in slewing bearing revenue was primarily due to the impact of manufacturing and construction downturns in Japan and ASEAN markets on ODM business, and customers shifting to direct orders of the company's self-produced high-quality products instead of procurement[101](index=101&type=chunk)[102](index=102&type=chunk) - The decrease in mechanical parts revenue was mainly due to reduced demand from a downturn in construction and mining businesses in the Philippines market[107](index=107&type=chunk) - The decline in machinery sales revenue was primarily due to fewer orders from Hong Kong contractor clients, linked to delays in projects such as the Hong Kong International Airport Third Runway[112](index=112&type=chunk) - The newly launched mineral trading business (nickel ore) generated **HK$8.601 million** in sales revenue during the period[116](index=116&type=chunk) [Cost, Expenses and Profitability Analysis](index=33&type=section&id=Cost_Expenses_and_Profitability) Cost of sales decreased by **38.7%** in line with revenue, while administrative expenses significantly dropped by **46.0%** due to the absence of **HK$6.8 million** in one-off listing expenses from the prior period, resulting in a profit attributable to shareholders of **HK$9.9 million**, compared to an adjusted profit of approximately **HK$21.6 million** in the prior period, indicating ongoing operational pressure - Cost of sales decreased by **38.7%** from **HK$45.6 million** to **HK$28 million**, primarily due to reduced revenue and changes in product mix[116](index=116&type=chunk) - Administrative expenses decreased by **46.0%** from **HK$13.9 million** to **HK$7.5 million**, mainly due to the absence of **HK$6.8 million** in listing-related expenses incurred in the prior period[118](index=118&type=chunk)[120](index=120&type=chunk) - Profit attributable to shareholders for the current period was approximately **HK$9.9 million**, compared to **HK$14.8 million** in the prior period[118](index=118&type=chunk) [Liquidity and Financial Resources](index=34&type=section&id=Liquidity_and_Financial_Resources) The Group maintains a robust financial position, primarily funded by internal cash flow and listing proceeds, with no bank borrowings as of June 30, 2024, and a strong current ratio of **21.3 times**, demonstrating excellent short-term solvency, with cash and cash equivalents totaling **HK$43.8 million** - As of June 30, 2024, the Group's cash and cash equivalents (including pledged deposits) amounted to **HK$43.8 million**[118](index=118&type=chunk) - The current ratio (current assets/current liabilities) significantly increased to **21.3 times** from **8.2 times** at the end of 2023[119](index=119&type=chunk) - The Group repaid all bank borrowings during the period and had no bank borrowings as of the period end[119](index=119&type=chunk) [Capital Management and Future Plans](index=35&type=section&id=Capital_Management_and_Future_Plans) The company completed a share subdivision in May 2024 to enhance stock liquidity, with most listing proceeds utilized as planned and the remaining **HK$1 million** allocated for ERP system, finance department expansion, and staff training, while future strategies include capacity enhancement, marketing, automation, and further expansion into mineral trading to address challenges and create shareholder value [Capital Structure and Use of Proceeds](index=35&type=section&id=Capital_Structure_and_Use_of_Proceeds) On May 21, 2024, the company completed a **1-for-2** share subdivision, and as of June 30, 2024, **HK$27.425 million** of the **HK$28.4 million** listing proceeds had been utilized, primarily for machinery and working capital, with the remaining **HK$0.975 million** earmarked for ERP system, finance department expansion, and staff training by Q4 2024 - The company completed a share subdivision on **May 21, 2024**, where each ordinary share of **HK$0.01** par value was subdivided into two shares of **HK$0.005** par value[122](index=122&type=chunk) Use of Proceeds | Use of Proceeds | Revised Allocation (HK$ '000) | Total Utilized (HK$ '000) | Remaining Amount (HK$ '000) | | :--- | :--- | :--- | :--- | | Acquisition and Replacement of Machinery and Equipment | 17,210 | 17,210 | - | | Market Share Expansion and Marketing | 1,246 | 1,246 | - | | Enhancement of Automation Level | 2,158 | 2,158 | - | | Establishment of ERP System | 1,704 | 873 | 831 | | Expansion of Finance Department | 1,420 | 1,420 | - | | Enhancement of Staff Training | 227 | 83 | 144 | | Maintenance of Working Capital | 4,435 | 4,435 | - | | **Total** | **28,400** | **27,425** | **975** | [Future Prospects and Strategy](index=41&type=section&id=Future_Prospects_and_Strategy) Despite global economic uncertainties, the Group aims to solidify its position as a quality slewing bearing manufacturer and expand its business by leveraging integrated advantages in mechanical parts and machinery supply, continuing strategies like capacity enhancement, marketing, automation, and ERP system establishment, while planning to expand mineral and related product procurement to boost revenue and profitability and maximize shareholder returns - The Group aims to consolidate its position as a quality slewing bearing manufacturer and enhance its competitiveness as an integrated product supplier[137](index=137&type=chunk) - Key future strategies include acquiring equipment to enhance production capacity, intensifying marketing efforts, improving automation levels, establishing an ERP system, expanding the finance department, and strengthening staff training[138](index=138&type=chunk) - The Group remains cautiously optimistic about the recovery of its procurement business and plans to expand the scope of mineral and related product procurement in the foreseeable future to enhance revenue and profitability[139](index=139&type=chunk)[140](index=140&type=chunk) [Other Information](index=43&type=section&id=Other%20Information) [Interests Disclosure](index=43&type=section&id=Interests_Disclosure) The report discloses shareholdings of directors, chief executives, and substantial shareholders, noting that as of June 30, 2024, Chairman Mr. Chan Yuk Bun, through C Centrum Holdings Limited, holds **75%** of the company's issued share capital as the controlling shareholder, with no share option scheme adopted or listed securities purchased, sold, or redeemed during the period - Chairman and Chief Executive Officer Mr. Chan Yuk Bun holds **600 million** shares through C Centrum Holdings Limited, representing **75%** of the company's issued share capital[143](index=143&type=chunk)[149](index=149&type=chunk) - During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[152](index=152&type=chunk) [Corporate Governance and Compliance](index=46&type=section&id=Corporate_Governance_and_Compliance) The Group is committed to high corporate governance standards, complying with the Listing Rules' Corporate Governance Code during the period, with the only deviation being the combined roles of Chairman and Chief Executive Officer held by Mr. Chan Yuk Bun, an arrangement the Board deems in the Group's best interest, and the Audit Committee has reviewed this interim financial report - The company complied with the Corporate Governance Code, with one deviation: the roles of Chairman and Chief Executive Officer are not separate, both held by Mr. Chan Yuk Bun[159](index=159&type=chunk) - The Board believes this arrangement is currently most appropriate given Mr. Chan Yuk Bun's contributions to the Group's overall management[159](index=159&type=chunk) - The Audit Committee, comprising three independent non-executive directors, has reviewed the unaudited interim condensed consolidated financial information for the six months ended June 30, 2024[166](index=166&type=chunk)[168](index=168&type=chunk)

Financial Performance - For the six months ended June 30, 2024, the company reported revenue of HKD 45,999,000, a decrease of 40.60% compared to HKD 77,437,000 in the same period of 2023[1] - Gross profit for the same period was HKD 18,031,000, down 43.40% from HKD 31,838,000 year-on-year[1] - Operating profit decreased by 40.90% to HKD 10,843,000 from HKD 18,343,000 in the previous year[1] - Profit for the period was HKD 9,949,000, reflecting a decline of 32.60% compared to HKD 14,756,000 in 2023[1] - The profit attributable to the company's owners was also HKD 9,949,000, down 32.60% from HKD 14,756,000 year-on-year[1] - Basic and diluted earnings per share were HKD 1.2, a decrease of 33.30% from HKD 1.8 in the same period last year[1] Assets and Equity - Total current assets amounted to HKD 123,283,000, a decrease of 11.90% from HKD 139,994,000[2] - Total assets were reported at HKD 145,559,000, down 11.70% from HKD 164,857,000[2] - Net current assets stood at HKD 117,515,000, a decrease of 4.40% compared to HKD 122,945,000 in the previous year[2] - Total equity was HKD 139,769,000, reflecting a decline of 5.30% from HKD 147,660,000 year-on-year[2]

Financial Performance - Revenue for the six months ended June 30, 2024, was HKD 45,999 thousand, a decrease of 40.60% compared to HKD 77,437 thousand in the same period of 2023[1] - Gross profit decreased by 43.40% to HKD 18,031 thousand from HKD 31,838 thousand year-over-year[1] - Operating profit for the period was HKD 10,843 thousand, down 40.90% from HKD 18,343 thousand in the previous year[1] - Net profit attributable to shareholders was HKD 9,949 thousand, a decline of 32.60% compared to HKD 14,756 thousand in the same period last year[1] - Basic and diluted earnings per share decreased by 33.30% to HKD 1.2 from HKD 1.8 year-over-year[1] Assets and Equity - Total current assets decreased by 11.90% to HKD 123,283 thousand from HKD 139,994 thousand as of December 31, 2023[3] - Total assets decreased by 11.70% to HKD 145,559 thousand from HKD 164,857 thousand as of December 31, 2023[3] - Total equity decreased by 5.30% to HKD 139,769 thousand from HKD 147,660 thousand as of December 31, 2023[3] - As of June 30, 2024, the company's total equity amounted to HKD 139,769 million, a decrease from HKD 147,660 million as of January 1, 2024[5] Cash Flow and Reserves - The company reported a net cash position of HKD 38,748 thousand, down from HKD 54,891 thousand in the previous year[3] - The cash flow from operating activities for the six months ended June 30, 2024, was HKD 26,253 million, compared to HKD 8,304 million for the same period last year[9] - The company incurred a foreign exchange reserve loss of HKD 1,840 million during the period[5] - The company has a statutory reserve of HKD 7,016 million, which is required by Chinese law to allocate at least 10% of after-tax profits[7] Revenue Breakdown - ODM revenue decreased by 45.1% to HKD 16.8 million from HKD 30.6 million in the previous period[35] - OEM revenue decreased by 17.9% to HKD 0.1 million from HKD 0.2 million in the previous period[35] - OBM revenue saw a significant drop of 77.9% to HKD 0.4 million from HKD 1.7 million in the previous period[35] - Revenue from rotary bearings decreased from HKD 41.5 million in the first half of 2023 to HKD 17.3 million, a decline of 58.3%[41] Expenses and Cost Management - The company incurred a total tax expense of 1,309,000 HKD for the six months ended June 30, 2024, compared to 3,929,000 HKD for the same period in 2023[18] - The cost of goods sold and consumables amounted to 23,055,000 HKD for the six months ended June 30, 2024, compared to 40,374,000 HKD for the same period in 2023[17] - The group's selling costs decreased by approximately 38.7% to HKD 28.0 million, primarily due to reduced revenue and the need to produce different product combinations[48] - Administrative expenses were reduced by approximately 46.0% to about HKD 7.5 million, attributed to decreased office expenses and listing-related costs[49] Business Strategy and Market Outlook - The company anticipates that 2024 will be a challenging year due to economic recovery issues in several countries and high interest rates impacting the global business environment[32] - The company aims to further diversify its heavy machinery offerings to include pile drivers and wheeled unloaders[31] - The group decided to expand its product procurement range to include minerals and related products, responding to increasing customer inquiries for a broader product range[34] - The company is positioned as one of the fastest-growing "full-service product" suppliers in its field[68] Corporate Governance and Compliance - The company aims to adhere to the corporate governance code as per the Hong Kong Stock Exchange listing rules[81] - The board has established a corporate governance committee to review the company's governance policies and practices[81] - The Audit Committee was established on October 21, 2019, consisting of three independent non-executive directors[83] Employee and Operational Changes - The group had 82 employees as of June 30, 2024, a decrease from 96 employees as of December 31, 2023[60] - The company has expanded its finance department by hiring senior accountants to manage increased business scale and production capacity[57] - The company aims to increase market share and strengthen sales capabilities, having increased manpower in the sales department to enhance support for sales activities[56] Future Developments - The company plans to enhance automation levels by integrating intelligent automation solutions into the production process, including the installation of robotic arms and the purchase of an automatic packaging machine[57] - The company has set a goal to improve data management efficiency through the establishment of an ERP system, with components currently undergoing testing and expected to be operational in the second half of 2024[57]

Financial Performance - Revenue for FY2023 increased to HK$143,779,000, up 12.6% from HK$127,730,000 in FY2022[11] - Gross profit for FY2023 was HK$60,789,000, representing a 4.8% increase from HK$57,924,000 in FY2022[11] - Profit before taxation decreased to HK$28,103,000, down 32.2% from HK$41,432,000 in FY2022[11] - Profit for the year was HK$22,039,000, a decline of 36.6% compared to HK$34,929,000 in FY2022[11] - Total comprehensive income for the year was HK$20,095,000, down 33.1% from HK$30,034,000 in FY2022[11] - Basic and diluted earnings per share were approximately HK5.5 cents, down from HK8.7 cents in 2022[39] - Net profit attributable to equity holders for the year was approximately HK$22.0 million, and excluding non-recurring expenses, the profit would have been approximately HK$34.4 million[39] Assets and Liabilities - Non-current assets decreased to HK$24,863,000 from HK$26,422,000 in FY2022[16] - Current assets increased to HK$139,994,000, up from HK$122,766,000 in FY2022[16] - Current liabilities rose significantly to HK$17,049,000 from HK$5,544,000 in FY2022[16] - Net current assets improved to HK$122,945,000, compared to HK$117,222,000 in FY2022[16] - Net assets increased to HK$147,660,000 from HK$143,565,000 in FY2022[16] - The Group's total current assets were approximately HK$140.0 million, while current liabilities were HK$17.0 million, resulting in a current ratio of 8.2 times[133] - The current ratio decreased from 22.3 times in 2022 to 8.2 times in 2023, indicating a significant change in liquidity position[133] Revenue Breakdown - Revenue from slewing rings decreased by 6.7% to HK$70,302,000, with ODM revenue at HK$56,718,000, down 0.1%[18] - Revenue from machineries surged by 82.5% to HK$49,864,000, up from HK$27,320,000 in the previous year[18] - Revenue from mechanical parts and components slightly decreased by approximately 5.8% year-on-year, from HK$25.1 million in FY2022 to HK$23.6 million in FY2023[101] - Revenue from heavy-duty machinery sales increased by approximately HK$22.6 million, or 82.5%, from HK$27.3 million in FY2022 to HK$49.9 million for the Reporting Period[105] - Revenue from the Filipino market surged by approximately 162.7% or HK$20.8 million, increasing from approximately HK$12.8 million in FY2022 to approximately HK$33.6 million for the Reporting Period[113] - Revenue from the Singaporean market decreased by approximately 14.0% or HK$7.2 million, from approximately HK$51.2 million in FY2022 to approximately HK$44.0 million for the Reporting Period[113] Listing and Market Presence - The company successfully transferred its listing from GEM to the Main Board of The Stock Exchange of Hong Kong on September 29, 2023[22] - The Group successfully transferred its listing from GEM to the Main Board on September 29, 2023, with the last trading day on GEM being September 28, 2023[60] - The Group aims to promote its brand and seize more business opportunities in various regions following its listing[33] - The Group has established a strong international customer base, including leading Japanese manufacturers, enhancing its market position[68] Operational Developments - The Group expanded its manufacturing capabilities to include mechanical parts such as sprockets, track shoes, and rollers, in addition to slewing rings[46] - The Group plans to broaden its product coverage to include minerals and related products to enhance revenue and profitability in the foreseeable future[51] - The Group aims to enhance factory automation to mitigate the impact of rising labor costs and overheads in the PRC[52] - The Group has installed robotic arms and acquired an automatic packaging machine and a CNC Coordinate Measuring Machine to enhance automation and production efficiency[152] Strategic Initiatives - The Group is committed to enhancing its product offerings and expanding its market presence through strategic initiatives[85] - Strategies include acquiring and replacing machinery to enhance production capacity, increasing market share, and establishing an ERP system[184] - The Group intends to enhance its competitiveness in the fragmented slewing ring manufacturing industry through increased automation and staff training[184] Human Resources and Management - The Group increased its workforce in the sales department to strengthen sales support and hired a consultant for web page design and promotion strategies[149] - As of December 31, 2023, the Group had 96 employees, an increase from 82 employees as of December 31, 2022[160] - The company has a focus on human resources management under Mr. LP Chan's leadership[194] Corporate Governance - The company emphasizes the importance of corporate governance and independent advice through its committees[198] - Mr. LP Chan is also the chairman of the Corporate Governance Committee and a member of the Remuneration Committee[194] Dividends - A final dividend of HK4.0 cents per share has been recommended, subject to shareholder approval[40] - No interim dividend was paid during the year; a final dividend of HK4.0 cents per share is recommended, totaling HK$16,000,000 for the year ended December 31, 2023[177]