Financial Performance - Revenue for the six months ended September 30, 2024, was HKD 24,232,000, a decrease of 0.8% compared to HKD 24,422,000 for the same period in 2023[9] - Gross profit for the same period was HKD 17,363,000, down 1.8% from HKD 17,679,000 year-on-year[9] - Operating loss narrowed to HKD 3,201,000 from HKD 3,366,000 in the previous year, indicating a 4.9% improvement[9] - The company reported a loss attributable to shareholders of HKD 3,398,000, compared to a loss of HKD 3,634,000 in the prior year, reflecting a 6.5% reduction in losses[9] - The net loss for the review period was approximately HKD 3,400,000, compared to a net loss of approximately HKD 3,600,000 in the previous year[47] - Gross profit decreased by approximately HKD 300,000 to about HKD 17,400,000, attributed to reduced revenue and a decline in gross profit margin by 0.7%[48] Cash Flow and Assets - Cash and cash equivalents increased significantly to HKD 41,745,000 from HKD 15,848,000, marking a 163.5% increase[11] - The cash and cash equivalents at the end of the period increased to HKD 41,745 thousand, compared to HKD 18,861 thousand at the end of the previous period[16] - For the six months ended September 30, 2024, the net cash used in operating activities was HKD (2,933) thousand, an improvement from HKD (4,647) thousand in the same period of 2023[16] - Cash generated from investing activities amounted to HKD 26,340 thousand, significantly up from HKD 373 thousand year-on-year[16] - Total assets decreased slightly to HKD 46,242,000 from HKD 46,610,000, a decline of 0.8%[11] - The company's net current asset value decreased to HKD 3,301,000 from HKD 7,957,000, a decline of 58.5%[11] Liabilities and Equity - Current liabilities increased to HKD 42,941,000 from HKD 38,653,000, representing an 11.8% rise[11] - The total equity instruments measured at fair value through other comprehensive income increased to HKD 1,129,000 as of September 30, 2024, from HKD 924,000 as of March 31, 2024, reflecting a growth of 22.2%[34] - The company has no significant contingent liabilities as of September 30, 2024, consistent with the situation as of March 31, 2023[44] Dividends and Share Options - The company did not recommend an interim dividend for the six months ended September 30, 2024, consistent with the previous year[29] - The group has decided not to declare any interim dividend for the six months ended September 30, 2024[60] - As of September 30, 2024, the company has 194,631,410 share options available for grant under the 2020 plan, representing 10% of the issued shares as of the report date[67] - There are 24,000,000 unexercised share options remaining under the 2010 plan, representing approximately 1.2% of the issued shares[67] - No share options were granted, exercised, or canceled during the review period, except for the expiration of 2,000,000 options held by Mr. Law upon his resignation[67] Management and Governance - The board approved the interim report on November 22, 2024, indicating ongoing governance and oversight[14] - The company has undergone significant changes in its board of directors, with key appointments and resignations occurring in June and August 2024[69] - The company has adopted the corporate governance code as per the listing rules, but did not comply with certain provisions regarding the separation of roles between the Chairman and CEO until August 16, 2024[79] - The Audit Committee consists of three independent non-executive directors and has reviewed the accounting standards and practices adopted by the group for the six months ending September 30, 2024[81] - The Remuneration Committee is responsible for recommending the remuneration policy for directors and senior management to the board[82] - The Nomination Committee reviews the board's structure and composition at least annually to align with the company's business needs and future development[83] Operational Insights - The company operates primarily in Hong Kong, focusing on providing Chinese cuisine through its restaurants[25] - The restaurant business in Hong Kong remains the core business, with a projected improvement in performance during the upcoming festive season[62] - The group is concerned about the declining foot traffic at the Kwun Tong restaurant and is seeking measures to boost sales and negotiate further rental concessions[54] - The outlook remains challenging due to rising food and service costs and a shortage of experienced labor in the Chinese restaurant industry[62] Other Income and Expenses - Other comprehensive income for the period was HKD 205,000, compared to a loss of HKD 140,000 in the same period last year[10] - Employee costs totaled approximately HKD 11,600,000, an increase from HKD 11,500,000 in the previous year, primarily due to hiring more part-time staff[50] - The company received rental income of HKD 2,160,000 from Hongli Development Limited during the reporting period, consistent with the previous period[40] - The financial cost for the period was HKD 204 thousand, which was the same as the previous year[29] - The company has no taxable profits for the periods, thus no provision for Hong Kong profits tax was necessary[29] Accounts Receivable and Payable - Accounts receivable as of September 30, 2024, stood at HKD 141 thousand, down from HKD 510 thousand as of March 31, 2024[27] - Accounts receivable aged analysis shows that as of September 30, 2024, the amount for 0-30 days was HKD 141,000, down from HKD 510,000 as of March 31, 2024, indicating a significant reduction of 72.4%[34] - Accounts payable aged analysis indicates that as of September 30, 2024, the amount for 0-60 days was HKD 2,525,000, an increase from HKD 2,399,000 as of March 31, 2024, representing a rise of 5.3%[36]
环科国际(00657) - 2025 - 中期财报