Revenue and Sales Performance - Revenue increased by 7.7% to RMB 3,206.5 million compared to RMB 2,976.8 million in the same period last year[4] - Total revenue for the six months ended June 30, 2024, was RMB 3,206,463,000, up from RMB 2,976,775,000 in the same period in 2023[24] - Revenue from cold-rolled steel products increased to RMB 1,669,663,000 in 2024 from RMB 1,572,966,000 in 2023, while revenue from galvanized steel products decreased to RMB 1,148,899,000 from RMB 1,178,601,000[24] - Revenue from customers in China (including Hong Kong) accounted for RMB 3,173,171,000 in 2024, compared to RMB 2,972,129,000 in 2023, while revenue from Southeast Asia increased to RMB 33,292,000 from RMB 4,646,000[27] - Revenue for the first half of 2024 increased by RMB 229.7 million or 7.7% to RMB 3,206.5 million compared to RMB 2,976.8 million in the same period of 2023[67] - Domestic sales in China contributed over 98.9% of revenue, with the remaining portion coming from sales to Southeast Asian customers[70] Profitability and Margins - Gross profit decreased by 32.4% to RMB 94.2 million, with a gross margin of 2.9%, down from 4.7% in the previous year[4] - Net profit attributable to the company's owners dropped by 57.1% to RMB 39.4 million, with a net profit margin of 0.5%, down from 1.3%[4] - Gross profit decreased to RMB 94.2 million in the first half of 2024 from RMB 139.3 million in the same period of 2023, with the gross profit margin dropping to 2.9% from 4.7%[77] - Net profit attributable to the company's owners decreased to RMB 16,885,000 in the first half of 2024, compared to RMB 39,446,000 in the same period in 2023[31] - The company's profit attributable to owners was approximately RMB 16.9 million in the first half of 2024, compared to RMB 39.4 million in the same period in 2023, with a net profit margin of 0.5% in 2024, down from 1.3% in 2023[85] Sales Volume and Pricing - Sales volume increased by 3.5% to 678,887 tons, while the average processing fee per ton decreased by 0.5% to RMB 439[4] - Total sales volume of cold-rolled steel and galvanized steel products increased by 23,059 tons or 3.5% to 678,887 tons in the first half of 2024 compared to 655,828 tons in the same period of 2023[67] - Cold-rolled steel product sales volume increased by 36,381 tons or 9.5% to 419,978 tons in the first half of 2024, while galvanized steel product sales volume decreased by 13,322 tons or 4.9% to 258,909 tons[70] - The average selling price of cold-rolled steel products decreased from RMB 4,249 per ton in the first half of 2023 to RMB 4,137 per ton in the first half of 2024, while the average selling price of galvanized steel products increased from RMB 4,329 per ton to RMB 4,437 per ton[70] Financial Position and Liabilities - Net asset value increased by 3.3% to RMB 531.9 million, with net asset value per share rising by 3.5% to RMB 0.89[4] - Total borrowings increased by 26.6% to RMB 2,882.7 million, leading to a gearing ratio of 542.0%, up from 442.6%[4] - Property, plant, and equipment increased to RMB 1,783.2 million from RMB 1,402.3 million, reflecting significant capital investment[10] - Trade receivables and other receivables rose to RMB 1,490.5 million, indicating an increase in credit sales[10] - Current liabilities increased to RMB 2,670.4 million, with short-term borrowings rising to RMB 1,845.2 million[10] - The company's cash and bank balances decreased to RMB 52.0 million from RMB 98.4 million, reflecting reduced liquidity[10] - Non-current liabilities increased to RMB 1,052,612 thousand as of June 30, 2024, compared to RMB 1,028,911 thousand at the end of 2023[11] - Net asset value rose to RMB 531,884 thousand as of June 30, 2024, up from RMB 514,749 thousand at the end of 2023[11] - The company's equity attributable to owners increased to RMB 529,960 thousand as of June 30, 2024, from RMB 512,825 thousand at the end of 2023[11] - The company's current liabilities exceeded its current assets by RMB 510,737,000 as of June 30, 2024, with contracted but unprovided capital commitments of RMB 185,794,000, of which RMB 156,517,000 is expected to be paid within the next 12 months[15] - The total bank financing for the company, including bank borrowings and bills payable, was approximately RMB 1,779,420,000 as of June 30, 2024, with RMB 1,129,200,000 utilized and RMB 650,220,000 unused[15] - The company's total borrowings increased to RMB 2.882 billion as of June 30, 2024, up from RMB 2.277 billion as of December 31, 2023, with fixed-rate borrowings accounting for RMB 2.636 billion[46] - Short-term borrowings (due within one year) increased to RMB 1.615 billion as of June 30, 2024, compared to RMB 1.145 billion as of December 31, 2023[46] - The company's secured borrowings increased to RMB 1.39 billion as of June 30, 2024, up from RMB 1.219 billion as of December 31, 2023[46] - The company's non-current liabilities related to borrowings decreased to RMB 928.724 million as of June 30, 2024, from RMB 952.563 million as of December 31, 2023[46] - The company's total borrowings increased to approximately RMB 2,882.7 million as of June 30, 2024, compared to RMB 2,277.9 million as of December 31, 2023, with a gearing ratio of 5.42 times, up from 4.43 times[87] Cash Flow and Liquidity - Operating cash flow before working capital changes was RMB 72,001 thousand for the six months ended June 30, 2024[13] - Net cash used in operating activities was RMB 603,779 thousand for the six months ended June 30, 2024[13] - Net cash used in investing activities was RMB 396,883 thousand for the six months ended June 30, 2024[14] - Net cash generated from financing activities was RMB 954,332 thousand for the six months ended June 30, 2024[14] - Cash and cash equivalents decreased by RMB 46,330 thousand during the six months ended June 30, 2024[14] - The company raised new borrowings of RMB 1,579,675 thousand during the six months ended June 30, 2024[14] - Repayment of borrowings amounted to RMB 557,231 thousand during the six months ended June 30, 2024[14] - The company generated a net cash outflow of RMB 46,330,000 and a net operating cash outflow of RMB 603,779,000 for the six months ended June 30, 2024[15] - The company's bank balances and cash decreased by RMB 46.4 million or 47.2% to approximately RMB 52.0 million as of June 30, 2024, compared to December 31, 2023, while restricted bank deposits increased by RMB 107.4 million or 43.4% to RMB 355.1 million[85] Expenses and Costs - Financial costs for the six months ended June 30, 2024, were RMB 53,216,000, up from RMB 35,072,000 in the same period in 2023, primarily due to increased interest expenses on borrowings[28] - The company's income tax expense for the six months ended June 30, 2024, was RMB 2,592,000, down from RMB 8,831,000 in the same period in 2023[29] - Employee benefits expenses increased to RMB 70,288,000 in the first half of 2024, up from RMB 60,445,000 in the same period in 2023[30] - Property, plant, and equipment depreciation amounted to RMB 51,120,000 in the first half of 2024, compared to RMB 45,873,000 in the same period in 2023[30] - Direct materials accounted for 92.1% of the cost of sales in the first half of 2024, primarily due to increased sales of cold-rolled steel products and hot-rolled steel coils[75] - Other income, other gains, and losses increased to approximately RMB 24.5 million in the first half of 2024, up by RMB 22.5 million or 1,125.0% compared to the same period in 2023, primarily due to VAT credits, unrealized gains from commodity futures contracts, and penalty income from scrap steel sales[78] - Sales expenses decreased to approximately RMB 16.8 million in the first half of 2024, down by RMB 17.1 million or 50.4% compared to the same period in 2023, mainly due to reduced delivery costs[79] - Administrative expenses increased to approximately RMB 36.9 million in the first half of 2024, up by RMB 9.9 million or 36.7% compared to the same period in 2023, driven by increases in salaries, employee compensation, consumables, and depreciation of right-of-use assets[80] - Investment income was approximately RMB 6.1 million in the first half of 2024, compared to RMB 0.5 million in the same period in 2023, mainly due to realized gains from commodity futures contracts[82] - Financial costs increased to approximately RMB 53.2 million in the first half of 2024, up by RMB 18.1 million or 51.6% compared to the same period in 2023, primarily due to higher borrowing levels[83] Receivables and Payables - Trade receivables increased to RMB 108,186,000 as of June 30, 2024, up from RMB 82,279,000 as of December 31, 2023[35] - Notes receivable surged to RMB 432,395,000 as of June 30, 2024, compared to RMB 234,474,000 as of December 31, 2023[35] - Trade receivables aged within 30 days increased to RMB 92,128,000 as of June 30, 2024, up from RMB 70,339,000 as of December 31, 2023[37] - Notes receivable aged between 121 to 180 days increased significantly to RMB 211,470,000 as of June 30, 2024, compared to RMB 47,254,000 as of December 31, 2023[37] - The company transferred receivables worth RMB 294.1 million as of June 30, 2024, compared to RMB 175.4 million as of December 31, 2023, with full recourse arrangements similar to previous periods[39] - Trade payables decreased to RMB 103.223 million as of June 30, 2024, from RMB 109.671 million as of December 31, 2023[40] - Trade payables aged within 30 days decreased to RMB 44.449 million as of June 30, 2024, from RMB 48.305 million as of December 31, 2023[42] - The company's total trade payables (excluding endorsed bills) decreased to RMB 76.146 million as of June 30, 2024, from RMB 106.104 million as of December 31, 2023[42] Capital Expenditures and Investments - The company acquired property, plant, and equipment with construction costs of RMB 432,236,000 in the first half of 2024, a significant increase from RMB 79,547,000 in the same period in 2023[34] - The company obtained a new land use right for RMB 41,613,000 in the first half of 2024, compared to RMB 25,710,000 in the same period in 2023[34] - Capital commitments for the acquisition of property, plant, and equipment amounted to RMB 185,794 thousand as of June 30, 2024[54] - Capital commitments for property, plant, and equipment amounted to RMB 185.8 million as of June 30, 2024, down from RMB 257.4 million as of December 31, 2023[69] - The company completed the construction of the Huajin Wharf No. 3 berth in early 2024 and obtained a port operation license, with the second phase of the wharf project expected to be completed and accepted around September 10, 2024[92] - The company plans to continue focusing on cold-rolled and galvanized steel processing services as its main business, while the wharf business is expected to broaden income sources, reduce transportation costs, and improve distribution and storage efficiency[92] Share Capital and Ownership - The company's issued share capital remained unchanged at 600 million shares with a nominal value of HKD 6 million as of June 30, 2024[48] - The company had 25,272,720 share options outstanding under its share option plan as of June 30, 2024, with no changes during the period[49] - The company granted a total of 25,272,720 share options as of June 30, 2024, with an exercise price of HKD 2.75 per share[53] - The fair value of share options granted, determined using the binomial model, was HKD 11,598,000[53] - Xu Songqing holds 391,500,000 shares, representing 65.25% of the company's issued share capital[93] - Luo Canwen holds 54,000,000 shares, representing 9.00% of the company's issued share capital[93] - Haiyi Limited, controlled by Intrend Ventures, holds 391,500,000 shares, representing 65.25% of the company's issued share capital[97] - Zhongcheng Limited, controlled by Luo Canwen, holds 54,000,000 shares, representing 9.00% of the company's issued share capital[97] - The company's total issued share capital as of June 30, 2024, is 600,000,000 shares[94] - Xu Songqing, Xu Jianhong, Luo Canwen, and Xu Songman each hold 1,818,181 shares, representing 0.30% of the company's issued share capital[95] - The company has a total of 7,272,724 unexercised share options as of June 30, 2024[100] - The total number of share options granted and outstanding as of June 30, 2024, is 25,272,720[101] - No share options were exercised or granted during the six months ended June 30, 2024[102] Dividends and Shareholder Returns - The company did not declare any interim dividend for the period ending June 30, 2024, consistent with the same period in 2023[32] - The company did not declare an interim dividend for the six months ended June 30, 2024[108] Corporate Governance and Compliance - The company maintained the required public float as per listing rules during the six months ended June 30, 2024[111] - The audit committee reviewed the unaudited condensed consolidated financial statements and confirmed they were prepared in accordance with applicable accounting standards[112] Company Information and Contacts - The company's registered office is located at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1–1111, Cayman Islands[115] - The company's headquarters in China is situated in Jiangmen City, Xinhui District, Guangdong Province[115] - The main business location in Hong Kong is at 14 Science Museum Road, Tsim Sha Tsui East, New Man Sang Centre, Block A, 5th Floor, Room 18[115] - The company's stock code is 2738[115] - The company's website is www.huajin-hk.com[115] - The company's auditor is Deloitte Touche Tohmatsu, a registered public interest entity auditor[115] - The company's primary bank relationships include Agricultural Bank of China Jiangmen Xinhui Branch, Jiangmen Rural Commercial Bank, and Guangzhou Bank Jiangmen Branch[115] - The company's share registrar in Hong Kong is United Securities Registration Limited, located at 338 King's Road, North Point, Hong Kong[115] - The company's board of directors includes executive directors Xu Songqing (Chairman), Xu Jianhong (Vice Chairman), and Luo Fengwen (CEO)[115] - The company's audit committee is chaired by Sun Duowei, with members Ou Qiyuan and Ye Yating[115] Financial Assets and Liabilities - The fair value of financial assets measured at fair value through profit or loss (futures products) was RMB 3,021 thousand as of June 30, 2024[59] - The fair value of financial assets measured at fair value through other comprehensive income (private equity investments) was RMB 1,799 thousand as of June 30, 2024[59] - Total assets pledged as collateral for borrowings amounted to RMB 1,941,528 thousand as of June 30, 2024[56] Remuneration and Compensation - Total remuneration for directors and key
华津国际控股(02738) - 2024 - 中期财报