Financial Performance - The Group's revenue for the year was approximately HK$4,665.2 million, a decrease of 7.0% compared to HK$5,018.7 million in the previous year[41]. - Profit attributable to equity holders was approximately HK$167.1 million, a decrease of 37.8% compared to HK$268.6 million last year[41]. - Higher net interest expenses amounted to approximately HK$34.3 million, contributing to the profit decline[41]. - Preliminary operating loss from the new Vietnam factory was approximately HK$34.8 million[41]. - An impairment loss from the investment in Teejay was approximately HK$64.2 million, which significantly impacted overall profit[41]. - Excluding the impairment loss, profit would have decreased by approximately 26.6%[41]. - The Group's financial performance was adversely affected by macro-economic factors, including US-China tensions, global economic uncertainty, and fluctuating exchange rates[151]. - The financial year ending March 31, 2024, saw a drop in profit attributable to shareholders due to fierce competition and weak customer demand, alongside higher net interest expenses and preliminary operating losses from the new Vietnam factory[109]. Debt and Capital Structure - The Group's total debt as of March 31, 2024, was HK$1,490,542,000, an increase from HK$1,450,138,000 in 2023, reflecting a growth of approximately 2.4%[29]. - The gearing ratio increased to 50% in 2024 from 47% in 2023, suggesting a higher reliance on debt financing[29]. - The net debt position rose to HK$585.7 million as of March 31, 2024, from HK$99.4 million in 2023, primarily due to the acquisition of property, plant, and equipment for the second Vietnam production site[48]. - The debt to equity ratio rose to 87.6% in 2024 from 79.0% in 2023, reflecting an increase in leverage[54]. - The Group's current ratio decreased to 1.2 in 2024 from 1.5 in 2023, while the quick ratio fell to 0.8 from 1.0[54]. - The Group's cash and bank balances decreased to HK$894.9 million in 2024 from HK$1,347.5 million in 2023[48]. Capital Expenditure - Total capital expenditure surged by 178.0% to HK$1,012.9 million in 2024, up from HK$364.3 million in 2023, mainly attributed to the construction of the second Vietnam factory costing approximately HK$838.0 million[50]. - The Group incurred approximately HK$1,013 million in expenditures during the 2024 Financial Year primarily to expand production capacity, compared to HK$364 million in 2023[145]. Operational Efficiency - The Group continues to engage in the manufacturing and trading of high-quality cotton and synthetic knitted fabrics[41]. - The Group's three factories will cater to different customer needs, enhancing operational efficiency and cost-effectiveness through economies of scale[110]. - Management expects a rebound in sales and profitability in the Financial Year 2024/25, followed by a mid-term growth trajectory[83]. Management and Governance - Ms. Ling Chi Wo Teresa appointed as Independent Non-executive Director since March 1, 2023, bringing over 30 years of experience in business management[93]. - The company emphasizes the importance of strategic planning and management through its experienced board members[119]. - The leadership team is committed to achieving corporate goals through effective management and strategic initiatives[119]. - The Group continues to strengthen its governance structure with independent directors overseeing key committees[121]. Risks and Challenges - Short-term challenges include geopolitics, inflation, interest expenses, and customers' sourcing policies[83]. - The Group faces risks from changes in governmental policies and regulations, which may lead to increased production costs[158]. - Legal risks from non-executable contracts or adverse judgments may negatively impact the Group's operations or financial condition[156]. - The Group identified various risks and uncertainties for the 2024 Financial Year, which could affect its business and prospects[129]. Dividends and Shareholder Returns - The Board proposed a final dividend of HK5 cents per share for the 2024 Financial Year, totaling HK12 cents per share for the year, down from HK19 cents in 2023[109]. - An interim dividend of HK$0.07 per share was paid on December 20, 2023, compared to HK$0.15 per share in 2023, while a final dividend of HK$0.05 per share is proposed for 2024, up from HK$0.04 per share in 2023[158]. - The Board intends to maintain long-term returns for shareholders, considering various factors such as financial results and market conditions when proposing dividends[158]. Employee and Workforce - As of March 31, 2024, the Group employed 4,874 full-time employees, an increase from 4,484 in 2023[109]. Environmental and Social Responsibility - The Company’s subsidiary in Panyu received multiple awards for environmental achievements, including being graded as an Environmental Integrity Enterprise by Guangzhou Municipal Ecological Environment Bureau in May 2023[108]. - The Company developed innovative products during the year, receiving awards such as the "2023 Excellent Fabric (First Prize)" for a 3D fabric from China Dyeing and Printing Association in July 2023[108].
互太纺织(01382) - 2024 - 年度财报