Financial Performance - Revenue for the six months ended June 30, 2019, was HKD 8,350,449, a decrease of 35.8% compared to HKD 13,008,736 in 2018[4] - Profit attributable to owners of the company for the same period was HKD 103,515, down 29.1% from HKD 146,074 in 2018[4] - Basic earnings per share decreased to 16.54 HKD cents, down 29.1% from 23.34 HKD cents in the previous year[4] - Gross profit for the period was HKD 416,510, compared to HKD 462,676 in the previous year[6] - Total comprehensive income for the period was HKD 138,975, down from HKD 175,914 in 2018[7] - The total income tax expense for the six months ended June 30, 2019, was HKD 31,388 thousand, compared to HKD 34,561 thousand in the previous year, indicating a decrease of 9.5%[45] - Net profit for the period was HKD 103,515,000, a decrease of 29.1% compared to HKD 146,074,000 in the previous year[66] Dividends and Shareholder Returns - The interim dividend per share was declared at 4.00 HKD cents, a reduction of 20.0% from 5.00 HKD cents in 2018[4] - Basic earnings per share for the six months ended June 30, 2019, were HKD 0.165 based on a profit attributable to shareholders of approximately HKD 103.5 million, compared to HKD 0.233 for the same period in 2018[50] - The company declared an interim dividend of HKD 0.04 per share, down from HKD 0.05 per share in the previous year[59] Cash Flow and Liquidity - The net cash generated from operating activities for the six months ended June 30, 2019, was HKD 544,454,000, compared to HKD 173,172,000 for the same period in 2018, representing a significant increase[21] - The net cash used in investing activities for the six months ended June 30, 2019, was HKD 14,314,000, an improvement from a cash outflow of HKD 57,948,000 in the previous year[21] - The net cash used in financing activities for the six months ended June 30, 2019, was HKD 484,834,000, compared to a cash inflow of HKD 320,485,000 in the same period of 2018, indicating a shift in financing strategy[21] - The company's current ratio improved to 116% as of June 30, 2019, compared to 110% at the end of 2018[67] - The net capital debt ratio decreased to 87% from 121% at the end of 2018, attributed to improved working capital efficiency[67] Assets and Liabilities - The company reported a decrease in inventory to HKD 850,104 from HKD 1,589,318 in the previous year[11] - Trade and other receivables decreased to HKD 1,045,329 from HKD 1,742,784 in 2018[11] - The total current liabilities decreased to HKD 3,515,333,000 as of June 30, 2019, from HKD 4,568,681,000 as of December 31, 2018, indicating improved liquidity[13] - The bank borrowings due within one year decreased to HKD 2,289,694,000 as of June 30, 2019, from HKD 2,687,644,000 at the end of 2018, indicating a reduction in short-term debt[13] - The total assets less current liabilities as of June 30, 2019, amounted to HKD 2,154,201,000, up from HKD 2,039,755,000 as of December 31, 2018[13] - The company's equity attributable to owners increased to HKD 1,635,974,000 as of June 30, 2019, from HKD 1,534,005,000 at the end of 2018, reflecting a growth in shareholder value[13] - The total equity as of June 30, 2019, was HKD 1,803,045,000, an increase from HKD 1,690,343,000 as of December 31, 2018, demonstrating overall financial growth[13] Revenue Breakdown - Customer contract revenue for the six months ended June 30, 2019, was HKD 8,321,867 thousand, down from HKD 12,975,281 thousand in the prior year, representing a decline of 35.8%[35] - Revenue from sales of electronic components and semiconductors was HKD 8,134,614 thousand, a decrease of 36.5% from HKD 12,800,651 thousand in the previous year[35] - Revenue from rental activities, including financing leases for home appliances and commercial equipment, was HKD 14,501 thousand, slightly down from HKD 15,345 thousand in the prior year[35] - The company reported a significant drop in revenue from LED lighting products, which fell to HKD 5,275 thousand from HKD 10,413 thousand, a decline of 49.3%[35] - Major customer A contributed HKD 4,648,607 thousand to revenue for the six months ended June 30, 2019, down from HKD 7,038,933 thousand in the same period of 2018, reflecting a decrease of 33.5%[44] Lease Accounting - The group has adopted the Hong Kong Financial Reporting Standard No. 16 (HKFRS 16) for the first time, replacing HKAS 17, which is expected to have no significant impact on the financial data[25] - The initial measurement of lease liabilities includes fixed payments and variable lease payments based on indices or rates[29] - The cost of right-of-use assets includes the initial measurement amount of lease liabilities and any direct costs incurred[27] - The group will assess whether a contract contains a lease based on the definition provided in HKFRS 16 at the date of contract formation or modification[30] - The group will recognize right-of-use assets at the commencement date, measured at cost less any accumulated depreciation and impairment losses[27] - Lease liabilities will be measured at the present value of unpaid lease payments at the lease commencement date[29] - The group has not early adopted any new or revised Hong Kong Financial Reporting Standards that have been issued but are not yet effective[25] - The application of HKFRS 16 is expected to result in changes to accounting policies related to leases[24] - The group will not reassess contracts unless the terms and conditions of the contract change[27] - The group has chosen to apply practical expedients for leases previously identified under HKAS 17[30] Strategic Initiatives - The company plans to focus on market expansion and new product development to improve future performance[12] - The company continues to develop competitive solutions, including high-performance memory storage and advanced smartphone camera lenses, despite a challenging business environment[61] - The company is capturing new business opportunities in Belt and Road countries, contributing to stable and sustainable results in the LED lighting B2B segment[62] - The company plans to closely monitor the trade war and its impacts, preparing to implement countermeasures as necessary[64] - The introduction of 5G technology is expected to drive a new smartphone replacement cycle by the end of 2019, boosting demand for new generation products[64] Employment and Governance - The company employed approximately 600 staff in the Greater China region, ensuring competitive compensation and benefits[71] - Foxconn Holding Limited holds 124,000,000 shares, representing 19.81% of the company's issued share capital[80] - As of June 30, 2019, the maximum number of shares available for issuance under the company's share option scheme is 24,658,072, equivalent to approximately 3.9% of the existing issued shares[83] - The company did not purchase, sell, or redeem any of its listed securities during the review period[85] - The company has complied with the corporate governance code, with some deviations noted regarding the separation of roles between the chairman and CEO[86] - The audit committee reviewed the accounting principles, internal controls, and risk management for the six months ending June 30, 2019[88]
S.A.S. DRAGON(01184) - 2019 - 中期财报