Financial Performance - Revenue decreased by approximately HKD 94.6 million or about 23.9% to approximately HKD 301.9 million for the six months ended June 30, 2024, compared to HKD 396.5 million for the same period in 2023[1] - Gross profit fell by approximately HKD 47.8 million or about 32.2% to approximately HKD 100.7 million for the six months ended June 30, 2024, down from HKD 148.5 million[1] - The gross profit margin decreased by approximately 4.1 percentage points to 33.3% for the six months ended June 30, 2024, from 37.4% for the same period in 2023[1] - Profit attributable to equity holders of the company decreased by approximately HKD 38.8 million or about 44.4% to approximately HKD 48.5 million for the six months ended June 30, 2024, compared to HKD 87.3 million for the same period in 2023[1] - Basic earnings per share were approximately HKD 0.1352 for the six months ended June 30, 2024, down from HKD 0.2433 for the same period in 2023[2] - Total revenue for the six months ended June 30, 2024, was HKD 301,933,000, a decrease of 24% compared to HKD 396,551,000 for the same period in 2023[16] - Revenue from Europe was HKD 270,240,000, down 20.5% from HKD 340,155,000 in the previous year[13] - Revenue from the United States decreased to HKD 3,347,000 from HKD 12,063,000, representing a decline of 72.2%[13] - The cost of goods sold for the six months ended June 30, 2024, was HKD 201,268,000, down from HKD 248,067,000 in 2023[17] - Net profit decreased by approximately HKD 38.8 million or approximately 44.4% from approximately HKD 87.3 million for the six months ended June 30, 2023, to approximately HKD 48.5 million for the six months ended June 30, 2024[35] Assets and Liabilities - The total assets less current liabilities amounted to HKD 372.2 million as of June 30, 2024, compared to HKD 348.2 million as of December 31, 2023[4] - Non-current assets increased to HKD 212.3 million as of June 30, 2024, from HKD 153.3 million as of December 31, 2023[4] - Current assets rose to HKD 435.6 million as of June 30, 2024, compared to HKD 324.0 million as of December 31, 2023[4] - The net asset value decreased to HKD 337.6 million as of June 30, 2024, from HKD 344.7 million as of December 31, 2023[5] - Trade receivables increased to HKD 135.8 million as of June 30, 2024, compared to HKD 67.5 million as of December 31, 2023[23] - The capital debt ratio as of June 30, 2024, was approximately 5.9%, a decrease from approximately 6.2% as of December 31, 2023, primarily due to a reduction in interest-bearing bank borrowings[40] - Cash and cash equivalents as of June 30, 2024, were approximately HKD 157.0 million, down from approximately HKD 187.7 million as of December 31, 2023[41] - Total interest-bearing bank borrowings as of June 30, 2024, were approximately HKD 19.8 million, down from approximately HKD 21.4 million as of December 31, 2023[42] Dividends and Share Issuance - The company declared an interim dividend of HKD 0.11 per share, totaling approximately HKD 39.5 million for the six months ended June 30, 2024[1] - The interim dividend for 2024 is proposed at HKD 11.0 cents per share, down from HKD 15.0 cents per share in 2023[21] - The company raised approximately HKD 90.7 million from the issuance of 100,000,000 new ordinary shares at HKD 1.30 per share on the listing date[48] - As of June 30, 2024, the company had utilized approximately HKD 78.6 million of the net proceeds from the share issuance, leaving a balance of approximately HKD 12.1 million[49] Expenses and Taxation - The total tax expense for the six months ended June 30, 2024, was HKD 8.5 million, compared to HKD 18.5 million for the same period in 2023[20] - Sales and distribution expenses decreased from approximately HKD 8.0 million for the six months ended June 30, 2023, to approximately HKD 7.2 million for the six months ended June 30, 2024, primarily due to a reduction in advertising and promotion expenses from approximately HKD 1.9 million to approximately HKD 1.0 million[31] - General and administrative expenses increased from approximately HKD 43.5 million for the six months ended June 30, 2023, to approximately HKD 44.8 million for the six months ended June 30, 2024, mainly due to employee benefits expenses rising from approximately HKD 28.2 million to approximately HKD 29.4 million[32] - Financing costs decreased from approximately HKD 1.4 million for the six months ended June 30, 2023, to approximately HKD 1.0 million for the six months ended June 30, 2024, due to a reduction in interest expenses on lease liabilities and bank borrowings[33] - Profit before tax decreased from approximately HKD 105.8 million for the six months ended June 30, 2023, to approximately HKD 57.0 million for the six months ended June 30, 2024, resulting in a decrease in income tax expenses from approximately HKD 18.5 million to approximately HKD 8.5 million[34] Future Outlook and Strategy - The company plans to deliver the first batch of new electric household appliances later this year, which have received positive feedback from existing and new customers[27] - The company maintains a cautious optimism for the second half of 2024, driven by replenishment orders from customers who have completed inventory reduction measures[27] - The company is focusing on diversifying its customer base and expanding its global presence beyond Europe[27] - The company expects to complete its existing automation projects in China by 2025, which will enhance product quality and reduce labor costs[27] Governance and Compliance - The group has no supplier financing arrangements, thus the recent accounting standards revisions had no impact on the interim financial statements[10] - The effective tax rate for the group remains at 16.5% for the period, consistent with the previous year[19] - Major customers contributing over 10% of revenue included Customer A with HKD 84,257,000 and Customer B with HKD 42,986,000[15] - The company has adopted corporate governance codes to enhance investor confidence and protect shareholder interests[50] - The Audit Committee was established on October 3, 2019, consisting of four independent non-executive directors, ensuring compliance with listing rules[55] - The interim financial results disclosed are unaudited but have been reviewed by the Audit Committee, which believes they comply with applicable accounting standards and listing rules[56] - The interim results announcement and report will be published on the Hong Kong Stock Exchange and the company's website in September 2024[57] - The Board expresses gratitude to the management team and all employees for their significant contributions to the group[58] Risks and Challenges - The company faces risks from public health events, geopolitical conflicts, and reliance on a few major customers, which could adversely affect sales and performance[45] - The company has not made any significant investments other than in its subsidiaries as of June 30, 2024[46]
登辉控股(01692) - 2024 - 中期业绩