LK TECH-力劲科技(00558) - 2024 - 年度财报

Financial Performance - Revenue for the fiscal year ending March 31, 2024, was HK $5,837,373,000, a 1% decrease year-over-year[7] - Net profit attributable to equity holders was HK$ 484,118,000, down 9.0% compared to the previous year[7] - Gross profit margin increased slightly to 27.2%, up 0.1% from the previous year[8] - Net profit margin decreased to 8.9%, down 0.1% from the previous year[8] - Revenue for FY2024 reached HKD 5,837,373,000, with a net profit attributable to owners of HKD 484,118,000 and a net profit margin of 8.3%[15] - Revenue for the fiscal year ending March 31, 2024, was HK $5,837.373 million, a slight decrease from HK$ 5,896.349 million in the previous year[143] - Gross profit for the year was HK $1,588.260 million, down from HK$ 1,596.687 million in 2023[143] - Operating profit for the year stood at HK $658.751 million, compared to HK$ 677.474 million in the previous year[143] - Net profit attributable to the company's owners was HK $517.739 million, a decrease from HK$ 532.235 million in 2023[143] - Basic earnings per share were HK $0.353, down from HK$ 0.387 in the previous year[143] - Other comprehensive loss for the year was HK $115.482 million, an improvement from HK$ 269.906 million in 2023[144] - Total comprehensive income attributable to the company's owners was HK $402.257 million, up from HK$ 262.329 million in the previous year[144] Asset and Liability Changes - Total assets increased by 27.7% to HK $10,905,823,000[9] - Cash and cash equivalents surged by 292.4% to HK$ 2,375,176,000[9] - Total assets increased to HK $10,905.8 million in 2024 from HK$ 8,539.9 million in 2023, representing a growth of 27.7%[140] - Non-current assets rose to HK $3,274.9 million in 2024, up from HK$ 2,994.7 million in 2023, a 9.4% increase[140] - Current assets surged to HK $7,630.9 million in 2024 compared to HK$ 5,545.2 million in 2023, marking a 37.6% growth[140] - Cash and cash equivalents significantly increased to HK $2,375.2 million in 2024 from HK$ 605.4 million in 2023, a 292.4% rise[140] - Total liabilities grew to HK $6,889.7 million in 2024 from HK$ 4,684.2 million in 2023, a 47.1% increase[141] - Non-current liabilities jumped to HK $2,734.1 million in 2024 from HK$ 414.7 million in 2023, a 559.3% surge[141] - Current liabilities slightly decreased to HK $4,155.6 million in 2024 from HK$ 4,269.4 million in 2023, a 2.7% decline[141] - Equity attributable to owners of the company dropped to HK $1,919.3 million in 2024 from HK$ 3,855.7 million in 2023, a 50.2% decrease[140] - Non-controlling interests appeared at HK $2,096.8 million in 2024, compared to none in 2023[140] - Retained earnings increased to HK$ 2,470.4 million in 2024 from HK $2,204.4 million in 2023, a 12.1% growth[140] Market and Industry Trends - China's new energy vehicle sales reached 9.495 million units in 2023, a 37.9% year-over-year increase[12] - New energy vehicle exports from China grew by 77.6% to 1.203 million units in 2023[12] - The global electric vehicle market is projected to reach 70 million units in sales by 2030, with China leading the growth[12] - China's plastic products industry achieved a production volume of 74.885 million tons in 2023, with a year-on-year growth of 3.0%[13] Business Expansion and Strategy - The company is expanding overseas markets through direct investments and focusing on R&D for advanced technologies[7] - The company's injection molding machine business revenue increased by 19.7% year-on-year to HKD 1,425,401,000 in FY2024[15] - The company's R&D investment in FY2024 increased by 58.3% year-on-year to HKD 214 million, with the R&D team expanding to 678 people, a 23.95% increase[17] - The company launched the world's first 20,000T ultra-large die-casting machine, targeting the integration of entire chassis for B-class and larger vehicles[18] - The company introduced the world's first 10,000T dual-shot die-casting process, addressing limitations in large-scale integrated die-casting[19] - The company's technical testing center, covering 4,239 square meters, is equipped with various testing equipment, including 3000T and 5000T die-casting machines[20] - The company exported a 6000T ultra-large two-platen injection molding machine overseas, marking a significant step in its internationalization strategy[21] - The company's die-casting machine business revenue decreased by 4.2% year-on-year to HKD 4,243,537,000 in FY2024[15] - Overseas market revenue reached HKD 1,335,618,000, a year-on-year increase of 21.9%, with North America contributing HKD 428,078,000 (up 9.5%) and Latin America contributing HKD 250,534,000 (up 97.7%)[23] - The company has over 60 sales offices and service centers across more than 20 countries, with plans to expand production bases and service centers in strategic regions like Mexico, India, and North America[24] - The company has entered new business areas, including Engineering, Procurement, and Construction (EPC) and customized production simulation, aiming to enhance revenue and profitability[25] - The EPC model provides intelligent solutions, including MES systems and robotic arms, improving production efficiency and reducing operational costs[26] - The company is leveraging China's equipment renewal policy to boost demand for injection molding machines and promote green, energy-efficient technologies[27] - A high-end intelligent equipment project in Anhui Province, with a total investment of approximately HKD 1.23 billion, has commenced construction[29] - The company signed a contract for a 16,000T intelligent die-casting unit with Guangdong Hongtu, aiming to establish a large-scale integrated die-casting factory[30] - LK Machinery was ranked among the top 35 plastic machinery manufacturers and top 18 plastic injection molding machine companies in China in 2023[31] - The company won the "2023 Hong Kong ESG Award" for its commitment to sustainable development and green energy technologies[32] - LK Group launched a 16,000-ton super intelligent die-casting unit, optimizing materials, structure, and casting processes, reducing lubrication points and oil usage, and supporting multiple network connections for large-scale automotive integrated die-casting structural parts manufacturing[33] - LK Group's intelligent ultra-large die-casting equipment production base in Hefei, Anhui, with a total investment of 1 billion RMB, covers 221 acres and is expected to produce over 1,000 sets of intelligent die-casting machines annually, creating over 1,000 jobs[34] - LK Group signed a strategic cooperation agreement with NIO for ultra-large integrated die-casting, jointly developing die-casting units over 20,000 tons and establishing a die-casting demonstration base and research institute[35] - LK Group and Chery Automobile unveiled the world's first dual-shot die-casting process, overcoming limitations in filling distance and enabling large-scale integrated die-casting[36] - LK Group's founder, Liu Xiangshang, was awarded the "Hong Kong Outstanding Brand Leader Award" for his contributions to brand development in Hong Kong[37] Corporate Governance - The company's board of directors consists of 3 executive directors and 4 independent non-executive directors, ensuring a balanced structure with deep knowledge and experience in the group's business operations[44] - The board of directors meets at least four times a year, with regular meetings scheduled in advance and notices issued at least 14 days prior[44] - Independent non-executive directors are appointed for a fixed term of three years and can be terminated with at least three months' written notice[44] - The company has applied and complied with the Corporate Governance Code as set out in Appendix C1 of the Hong Kong Stock Exchange Listing Rules[44] - The company secretary ensures compliance with board procedures and provides advice on corporate governance and regulatory compliance matters[44] - Directors receive complete and sufficient information to make informed decisions, with board meeting documents distributed at least three days before the meeting[44] - Board meeting minutes, including detailed records of considerations and concerns raised by directors, are made available to all directors for review and comment[44] - Independent non-executive directors attend board meetings where significant conflicts of interest arise, ensuring impartial decision-making[44] - The board reviews corporate governance policies, director training, legal compliance, and adherence to the Corporate Governance Code[45] - The company has received annual independence confirmations from all independent non-executive directors, confirming their status as independent individuals[44] - The company has arranged appropriate insurance for directors and officers to cover potential legal actions, ensuring sufficient protection[46] - The roles of Chairman and CEO are separated, with Ms. Zhang Qiaoying serving as Chairman and Mr. Liu Zhuoming as CEO[48] - The company awarded a total of 24,936,635 share rewards under the Shenzhen Lijin equity incentive plan, with 1,100,000 rewards granted to directors and their associates[52] - The Remuneration Committee held two meetings during the year, focusing on adopting the equity incentive plan and renewing the consultancy agreement with Mr. Liu Xiangshang[50] - The Nomination Committee, chaired by Mr. Lu Dong, held one meeting to discuss the renewal of the consultancy agreement with Mr. Liu Xiangshang[53] - The company has adopted a Board Diversity Policy to achieve diversity in board composition, considering factors such as gender, age, cultural background, and professional experience[54] - The Chairman held a meeting with all independent non-executive directors on November 29, 2023, without the presence of other directors[49] - The company provided legal and regulatory updates to all directors and recorded their participation in professional development courses[47] - The company's senior management annual remuneration ranges from HKD 0 to HKD 5,500,000[51] - The company's directors attended all 10 board meetings and 1 annual general meeting during the year[49] - The company has 5,377 employees as of March 31, 2024, with 4,591 males (85%) and 786 females (15%)[55] - The audit committee held two meetings with the company's executive directors, management representatives, internal auditors, and external auditors to discuss audit, financial reporting, operational performance, and internal control matters[55] - The company paid HKD 4.85 million for audit services and HKD 1.535 million for non-audit services, totaling HKD 6.385 million[61] - The company has established a robust risk management and internal control system to achieve strategic objectives and protect shareholder investments and company assets[59] - The company has identified key risks that could affect its strategic objectives and has implemented risk management and mitigation measures to control risks at an acceptable level[63] - The internal audit department conducts independent audits to assess the effectiveness of the company's internal control system and reports directly to the audit committee[64] - The board of directors has reviewed and confirmed the effectiveness of the company's risk management and internal control systems, as well as the adequacy of resources, qualifications, and training for accounting, internal audit, and financial reporting functions[66] - The company plans to distribute dividends of no less than 30% of the distributable profits generated during the year, subject to the board's discretion and considering factors such as profitability, financial condition, and cash requirements[68] - The company paid an interim dividend of HK$ 0.045 per share for the period ended September 30, 2023, and proposed a final dividend of HK$0.05 per share for the year ended March 31, 2024, pending shareholder approval[77] - The company's main business includes the design, manufacture, and sale of hot and cold chamber die-casting machines, injection molding machines, CNC machining centers, and related accessories, as well as casting operations[76] - The company has strengthened investor relations by arranging factory visits and meetings with institutional investors, potential investors, financial analysts, and fund managers to provide a deeper understanding of the group's operations and development[71] - The company has adopted a new memorandum and articles of association to allow for hybrid and virtual general meetings, effective from September 6, 2022[75] - The company confirms compliance with relevant laws and regulations, with no significant violations or non-compliance that materially affected the business and operations during the year[79] - The company is committed to environmental policies and ensures that all factory operations strictly comply with relevant environmental laws and regulations[80] - The company maintains good relationships with employees, customers, and suppliers, with no significant disputes reported during the year[80] - The company's environmental, social, and governance (ESG) report for 2023/2024 is available on the company's website and the Hong Kong Stock Exchange website[81] - The company did not enter into any share-linked agreements during the year that would or might result in the issuance of shares[82] - The company's distributable reserves as of March 31, 2024, amounted to HKD 1,204,308,000, consisting of share premium of HKD 1,123,842,000 and retained earnings of HKD 80,466,000[83] - The company made charitable donations totaling HKD 791,000 during the year[83] - The company's indirect wholly-owned subsidiary, LK Machinery (Shenzhen) Co., Ltd., entered into a cooperation agreement for the sale of property in Shenzhen, Guangdong, China, with a monetary consideration of RMB 350,000,000 (approximately HKD 419,100,000) and a return property valued at RMB 1,249,000,000 (approximately HKD 1,495,600,000)[87] - As of the report date, the company is negotiating follow-up arrangements for the cooperation agreement related to the LK High-Tech Industrial Park urban renewal project[87] - No significant contracts were entered into between the company or its subsidiaries and the company's controlling shareholders during the year ended March 31, 2024[88] - Girgio holds 849,078,004 shares, representing 61.69% of the company's equity[94] - Zhang holds 3,105,000 shares directly, representing 0.22% of the company's equity[91] - Liu Zhuoming holds 1,000,000 shares through stock options, representing 0.07% of the company's equity[91] - Liu Xiangshang holds 5,722,750 shares, representing 0.42% of the company's equity[91] - HSBC International Trustee Limited holds 848,078,004 shares, representing 61.62% of the company's equity[94] - The company granted a total of 27,540,000 stock options to 390 employees on September 24, 2021[97] - Zhang was granted 120,000 stock options with an exercise price of HKD 19.86 per share[98] - Liu Zhuoming was granted 90,000 stock options with an exercise price of HKD 19.86 per share[98] - The stock options granted on September 24, 2021, have a vesting period until September 24, 2025[98] - The total number of shares that may be issued upon the exercise of all options under the share option plan and any other plans of the group shall not exceed 113,326,500 shares, equivalent to 10% of the company's issued share capital as of the approval date of the share option plan[104] - The maximum number of shares that may be issued upon the full exercise of all outstanding options under the share option plan and any other plans of the group shall not exceed 30% of the company's issued shares from time to time[104] - No single person shall be granted options that result in the total number of shares issued and to be issued due to the exercise of granted and to be granted options exceeding 1% of the issued shares in any 12-month period[105] - The share option plan aims to provide eligible individuals with the opportunity to own personal equity in the company, incentivize them to enhance their future performance and efficiency, and reward their past contributions[102] - The share option plan allows the board to grant options to eligible individuals, including full-time or part-time employees and directors of any member company of the group[103] - The options are divided into three tranches: 40% exercisable after the second anniversary of the grant date, 30% after the third anniversary, and 30% after the fourth anniversary, all until September 23, 2031[101] - The options are subject to specific performance indicators for the applicable fiscal year as per the evaluation mechanism[101] - The share option plan is designed to attract, retain, and maintain continuous cooperation with individuals whose contributions are or will be beneficial to the group's performance, development, or success[102] - The company granted a total of 24,936,635 fully vested shares of Shenzhen Lijin to 437 selected employees, representing approximately 4.07% of Shenzhen Lijin's issued shares as of the report date[108] - The fair value of the awarded shares on the grant date was RMB 17.47 per share of Shenzhen Lijin[110] - During the year, 1,100,000 shares with a total fair value of RMB 19,217,000.00 were granted to directors and/or their associates, while 23,836,635 shares with a total fair value of RMB 416,426,013.45 were granted to other employee participants[110] - The share incentive plan aims to reward and recognize suitable individuals who are directors and/or employees of the Shenzhen Lijin Group, enhance employee ownership and sense of belonging, and improve the company's governance structure and incentive mechanism[111] - The