Financial Performance - The Group recorded a turnover of approximately HK$122.6 million for the six months ended 30 June 2021, representing a decrease of approximately HK$53.9 million compared to HK$176.5 million for the same period in 2020[4][5]. - The gross profit margin slightly decreased to approximately 8.2% for the six months ended 30 June 2021, down from approximately 9.7% for the same period in 2020[4][5]. - The profit attributable to the owners of the Company was approximately HK$0.4 million for the six months ended 30 June 2021, a decrease of approximately HK$4.9 million compared to HK$5.3 million for the same period in 2020[6]. - Revenue for the three months ended June 30, 2021, was HK$50,500,000, an increase from HK$45,008,000 in the same period of 2020, representing an increase of approximately 3.3%[12]. - Gross profit for the six months ended June 30, 2021, was HK$10,107,000, compared to HK$17,186,000 for the same period in 2020, indicating a decrease of about 41.0%[12]. - Profit before income tax for the three months ended June 30, 2021, was HK$811,000, a significant decrease from HK$5,946,000 in the same period of 2020, reflecting a decline of approximately 86.4%[12]. - Profit for the period attributable to owners of the Company for the three months ended June 30, 2021, was HK$359,000, down from HK$4,396,000 in the same period of 2020, a decrease of about 91.8%[14]. - Total comprehensive income for the period was HK$658,000 for the three months ended June 30, 2021, compared to HK$4,208,000 for the same period in 2020, representing a decline of approximately 84.3%[14]. - Earnings per share attributable to owners of the Company for the three months ended June 30, 2021, was HK$1.53, a decrease from HK$18.76 in the same period of 2020, reflecting a decline of about 91.9%[14]. - The company reported a profit for the period ended June 30, 2021, with total comprehensive income of HK$1,408,000[21]. Dividends and Shareholder Returns - The Board does not recommend the payment of an interim dividend for the six months ended 30 June 2021, consistent with the previous year where no dividend was paid[6]. - For the six months ended June 30, 2021, the profit attributable to owners of the Company was HK$377,000, a decrease of 92.85% compared to HK$5,255,000 for the same period in 2020[109]. - Basic earnings per share for the six months ended June 30, 2021, was HK$1.61, down from HK$22.42 in the same period of 2020, representing a decline of 92.85%[109]. Revenue Breakdown - Revenue from sales and distribution of IT products accounted for approximately 99.0% of the Group's total revenue, with a decline primarily due to a decrease in quantity and price of third-party IT products due to technological advancements[157][158]. - Revenue from repairs and service support increased from approximately HK$0.1 million to approximately HK$1.3 million, attributed to expanded service support for IT products beyond video surveillance products[160][161]. - The Hong Kong market contributed approximately 62.0% of the Group's revenue for the six months ended 30 June 2021, up from approximately 23.8% in the same period of 2020[163][164]. - The Taiwan market contributed approximately 19.0% of the Group's revenue, significantly increasing from approximately 3.3% in the previous year[163][164]. - The United States market's contribution to revenue decreased to approximately 12.5% from approximately 39.4% in the same period of 2020[163][164]. Expenses and Cost Management - Selling and distribution costs for the six months ended June 30, 2021, were HK$2,689,000, down from HK$3,280,000 in the same period of 2020, a decrease of about 18.0%[12]. - Administrative expenses for the six months ended June 30, 2021, were HK$7,539,000, compared to HK$8,737,000 for the same period in 2020, reflecting a decrease of approximately 13.7%[12]. - The cost of sales decreased to approximately HK$112.5 million for the six months ended June 30, 2021, down from approximately HK$159.3 million in the corresponding period of 2020, reflecting a decrease in revenue[166]. - Gross profit decreased by approximately HK$7.1 million, resulting in a gross profit margin of approximately 8.2% for the six months ended June 30, 2021, due to a significant drop in prices of end-of-life products[166]. - Selling and distribution expenses decreased by approximately 18.0% to approximately HK$2.7 million during the six months ended June 30, 2021[166]. - Administrative expenses decreased by approximately 13.7% to approximately HK$7.5 million during the six months ended June 30, 2021, due to improved operating efficiencies[166]. Assets and Liabilities - Total assets as of June 30, 2021, were HK$162,885,000, a decrease of 16.1% from HK$194,268,000 as of December 31, 2020[16]. - Current liabilities decreased significantly from HK$48,641,000 to HK$15,932,000, representing a reduction of 67.2%[18]. - Total equity increased slightly from HK$145,251,000 to HK$146,659,000, reflecting a growth of 1.0%[16]. - Inventories decreased from HK$32,256,000 to HK$18,257,000, a decline of 43.4%[16]. - Non-current liabilities decreased from HK$49,017,000 to HK$16,226,000, a reduction of 66.9%[18]. - Cash and cash equivalents decreased from HK$170,818,000 to HK$87,667,000, a decline of 48.7%[16]. - The company's accumulated losses improved slightly from HK$57,451,000 to HK$57,074,000, a reduction of 0.7%[16]. - The total trade payables as of June 30, 2021, were HK$11,548,000, a significant decrease of 75% from HK$46,142,000 as of December 31, 2020[125]. - The company reported trade payables of HK$8,924,000 within 1 month as of June 30, 2021, compared to HK$42,229,000 as of December 31, 2020, indicating a substantial reduction[126]. Cash Flow and Financing - Net cash used in operating activities was HK$ (16,882) million, compared to HK$ 24,076 million generated in the previous period[25]. - Net cash generated from investing activities was HK$ 42 million, a significant improvement from HK$ (22) million used in the prior period[25]. - Net cash used in financing activities decreased to HK$ (518) million from HK$ (693) million[25]. - Cash and cash equivalents at the end of the period were HK$ 87,667 million, slightly up from HK$ 86,183 million in the previous period[25]. - The effect of exchange rate changes on cash and cash equivalents was a positive HK$ 330 million, compared to a negative impact of HK$ (199) million previously[25]. - The company reported a net decrease in cash and cash equivalents of HK$ (17,358) million, contrasting with an increase of HK$ 23,361 million in the prior period[25]. - The Group did not have any borrowings during the six months ended June 30, 2021, maintaining a debt-free status[196]. Market and Strategic Initiatives - The company is primarily engaged in the sales and distribution of IT products and the provision of repairs and other service support of IT products[28]. - The Group aims to improve inventory turnover days and mitigate inventory risk to shorten the cash conversion cycle[145]. - The Group's management expertise and strong ties with international brands through Foxconn Technology Group provide a competitive advantage in the market[145]. - The Group is actively approaching target customers and service centers to expand its electronic product service support business[152]. - The Group anticipates facing intense competition in the IT product distribution business and may adjust its business portfolio to increase its customer base[177]. - The Group believes there is significant growth potential in the repairs and service support segment, despite delays in expansion plans due to COVID-19[178]. - Management expects to strengthen the management team and may require additional fundraising to support working capital expenditures for business growth[179]. Compliance and Accounting - The financial statements were prepared in compliance with the GEM Listing Rules and Hong Kong Accounting Standard 34, ensuring adherence to regulatory requirements[9]. - The financial statements are prepared in accordance with Hong Kong Accounting Standards and the applicable disclosure requirements of the GEM Listing Rules[30]. - The adoption of the amended HKFRS 16 did not have a material impact on the Group's financial information for the six months ended June 30, 2021[30]. - Management's significant judgments and estimates in applying accounting policies remain consistent with those applied in the consolidated financial statements for the year ended December 31, 2020[30]. Investments and Acquisitions - The Group did not make any material acquisitions or disposals of subsidiaries and affiliated companies during the six months ended June 30, 2021[198]. - The Group fully utilized HK$17,800,000 for a strategic investment in the "circular economy" business segment, acquiring 21% of 4Square Return GmbH, which focuses on compliance consulting and recycling services[188].
讯智海(08051) - 2021 - 中期财报