运兴泰集团(08362) - 2024 - 中期财报

Management Discussion and Analysis This section provides an overview of the Group's operations, financial performance, and future outlook for the reporting period Business Review and Prospects The Group's core business involves food processing, sales, and restaurant operations in Hong Kong, with strategic joint ventures aimed at enhancing future sales and revenue - The Group primarily engages in food processing, sales, and restaurant operations[3] - The Group participates in the catering business through Rong Tai Catering Limited (55% stake) and Sun King Tai Limited (60% stake), acting as the primary food and beverage material supplier for these joint ventures to enhance the Group's sales and revenue[3][4][5] Financial Review For the six months ended June 30, 2024, the Group's financial performance significantly improved with a 4.2% revenue increase and a substantial reduction in net loss, demonstrating robust liquidity Financial Performance Summary | Financial Indicator | For the Six Months Ended June 30, 2024 | For the Six Months Ended June 30, 2023 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Total Revenue | HKD 54.2 million | HKD 52.0 million | +4.2% | | - Food Processing and Trading | HKD 43.6 million | HKD 37.5 million | +16.3% | | - Restaurant Operations | HKD 10.6 million | HKD 14.5 million | -26.9% | | Gross Profit | HKD 24.8 million | HKD 23.7 million | +4.6% | | Gross Margin | 45.8% | 45.6% | +0.2pp | | Net Loss for the Period | HKD 0.8 million | HKD 3.2 million | -75.0% | - The Board does not recommend an interim dividend for the six months ended June 30, 2024[7] Liquidity and Financial Resources | Liquidity and Financial Resources | As at June 30, 2024 | As at December 31, 2023 | | :--- | :--- | :--- | | Net Current Assets | HKD 14.9 million | HKD 13.8 million | | Bank and Cash | HKD 14.1 million | HKD 10.3 million | | Bank Borrowings | HKD 2.4 million | HKD 2.9 million | | Gearing Ratio | 2.6% | 3.1% | Other Information This section details significant changes in directors' and shareholders' interests and the Group's adherence to corporate governance principles Directors' and Shareholders' Interests Significant equity changes occurred during the period, resulting in the offeror and parties acting in concert holding 75% of the Company's issued share capital - On January 26, 2024, the controlling shareholder sold approximately 76.78% of its shares in Kin King Ventures (the Company's holding company) to the offeror (Mr. Chung Yuk Wah, Ms. Au Hung Lin, etc.)[12] - Upon completion of the transaction, the offeror and parties acting in concert held 75% of the Company's equity through Kin King Ventures, triggering a mandatory unconditional cash offer under the Takeovers Code[13] - As at June 30, 2024, Kin King Ventures Limited held 1,050,000,000 shares of the Company, representing 75% of the issued share capital[14] Corporate Governance and Compliance The Group generally complied with the Corporate Governance Code during the reporting period, with the Audit Committee reviewing the interim report - The Group complied with the Corporate Governance Code during the reporting period, except for the company secretary not being an employee of the Group, but an executive director has been appointed as a contact person to ensure smooth communication[18] - The Audit Committee comprises three independent non-executive directors, Mr. Lo Sun Tong (Chairman), Mr. Chow Chun Wai, and Mr. Lam Lai Kiu, and has reviewed this report[19] - The Directors confirm compliance with the Model Code for Securities Transactions by Directors during the reporting period, and the controlling shareholder complied with the non-competition undertaking[16][17] Condensed Consolidated Financial Statements This section presents the Group's condensed consolidated financial statements, including the statement of profit or loss, financial position, and cash flows Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2024, the Group's revenue increased by 4.1%, and loss before tax significantly narrowed due to effective cost control Condensed Consolidated Statement of Profit or Loss | Item (HKD thousands) | For the Six Months Ended June 30, 2024 | For the Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Revenue | 54,172 | 52,030 | | Loss Before Tax | (807) | (3,197) | | Loss for the Period | (807) | (3,197) | | Loss Attributable to Owners of the Company | (414) | (2,952) | | Basic Loss Per Share (HK cents) | (0.03) | (0.21) | Condensed Consolidated Statement of Financial Position As at June 30, 2024, the Group maintained a robust financial position with increased net assets and cash and cash equivalents Condensed Consolidated Statement of Financial Position | Item (HKD thousands) | As at June 30, 2024 (Unaudited) | As at December 31, 2023 (Audited) | | :--- | :--- | :--- | | Non-current Assets | 82,152 | 84,385 | | Current Assets | 34,673 | 36,243 | | Current Liabilities | 19,726 | 22,457 | | Non-current Liabilities | 9,787 | 11,315 | | Net Assets | 87,312 | 86,856 | | Equity Attributable to Owners of the Company | 93,112 | 92,230 | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2024, the Group generated significant net cash from operating activities, leading to a net increase in cash and cash equivalents Condensed Consolidated Statement of Cash Flows | Item (HKD thousands) | For the Six Months Ended June 30, 2024 | For the Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Net Cash Flows From Operating Activities | 8,024 | 1,562 | | Net Cash Flows From/(Used In) Investing Activities | (86) | 154 | | Net Cash Flows Used In Financing Activities | (4,109) | (2,443) | | Net Increase/(Decrease) in Cash and Cash Equivalents | 3,829 | (727) | | Cash and Cash Equivalents at Beginning of Period | 10,283 | 15,601 | | Cash and Cash Equivalents at End of Period | 14,112 | 14,874 | Notes to the Condensed Consolidated Financial Statements This section provides detailed notes supporting the condensed consolidated financial statements, including segment information, revenue breakdown, and related party transactions Segment Information The Group operates in two segments: Food Processing and Trading, and Restaurant Operations, with all revenue and non-current assets located in Hong Kong Operating Segment Performance (HKD thousands) | Operating Segment (HKD thousands) | Revenue (External) | Segment Results (Loss/Profit) | | :--- | :--- | :--- | | Food Processing and Trading | 43,564 | (2,960) | | Restaurant Operations | 10,608 | 2,143 | | Total | 54,172 | (817) | - All the Group's revenue from external customers is generated in Hong Kong, and all non-current assets are also located in Hong Kong[36] Revenue Total revenue from contracts with customers for the period was HKD 54.172 million, primarily from sales of food transferred at a point in time Revenue by Category (HKD thousands) | Revenue Category (HKD thousands) | For the Six Months Ended June 30, 2024 | For the Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Sales of Food | 43,534 | 37,453 | | Revenue from Transportation Services | 30 | 45 | | Revenue from Restaurant Operations | 10,608 | 14,532 | | Total Revenue from Contracts with Customers | 54,172 | 52,030 | Related Party Transactions The Group engages in significant transactions with various related parties controlled by directors and shareholders, including sales, purchases, and remuneration to key management - The Group conducts business with several companies controlled by directors and shareholders (or their families), including Yau Hing, Guangzhou Geyun, Wing Chi, Yau Yip Property, etc[55] Related Party Transactions (HKD thousands) | Related Party Transaction (HKD thousands) | For the Six Months Ended June 30, 2024 | Nature of Transaction | | :--- | :--- | :--- | | Yau Hing | 2,787 | Sales of Goods | | Guangzhou Geyun | 240 | Purchases of Goods | | Wing Chi | 872 | Purchases of Goods | | Yau Yip Property | - | Rental Expenses | - For the six months ended June 30, 2024, total remuneration paid to key management personnel was HKD 2,498 thousand (2023: HKD 2,474 thousand)[58]