FIRST CREDIT(08215) - 2024 - 中期财报

Introduction and GEM Market Characteristics The GEM market offers a high-risk listing platform for SMEs, with the Board confirming report accuracy GEM Market Characteristics The GEM market offers a high-risk listing platform for SMEs, with the Board confirming report accuracy - The GEM market is designed for small and medium-sized companies, carrying higher investment risks than main board listed companies[1][4] - GEM securities may experience greater market volatility and do not guarantee high liquidity[1][4] - The company's directors assume full responsibility for the accuracy, completeness, and non-misleading nature of this report's content[3][4] Financial Statements Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For H1 2024, the company's loss significantly widened due to substantial revenue decline and increased loan impairment Key Data from Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Revenue | 912,469 HKD | 17,159,460 HKD | | Other income | 3,518 HKD | 3,145 HKD | | Other loss | (166,813 HKD) | (2,155,283 HKD) | | Administrative expenses | (2,619,878 HKD) | (6,006,282 HKD) | | Net impairment loss on loans receivables | (37,512,734 HKD) | (31,430,381 HKD) | | Operating loss | (41,751,941 HKD) | (25,290,244 HKD) | | Finance costs | (52,254 HKD) | (102,873 HKD) | | Loss before tax | (41,804,195 HKD) | (25,393,117 HKD) | | Income tax expense | – | (9,792 HKD) | | Loss and total comprehensive expenses for the period | (41,804,195 HKD) | (25,402,909 HKD) | | Basic loss per share (HK cents) | (1.15 HK cents) | (0.70 HK cents) | Unaudited Condensed Consolidated Statement of Financial Position As of June 30, 2024, total and net assets decreased from 2023-end, driven by reduced loans and cash Key Data from Statement of Financial Position (As of June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Total non-current assets | 22,020,948 HKD | 27,051,070 HKD | | Total current assets | 62,408,954 HKD | 99,431,611 HKD | | Total current liabilities | 1,792,520 HKD | 1,966,960 HKD | | Net current assets | 60,616,434 HKD | 97,464,651 HKD | | Total assets less current liabilities | 82,637,382 HKD | 124,515,721 HKD | | Total non-current liabilities | – | 74,144 HKD | | Net assets | 82,637,382 HKD | 124,441,577 HKD | | Share capital | 72,576,000 HKD | 72,576,000 HKD | | Reserves | 10,061,382 HKD | 51,865,577 HKD | | Total equity | 82,637,382 HKD | 124,441,577 HKD | - Loans receivables in non-current assets decreased from 5,030,122 HKD at the end of 2023 to zero as of June 30, 2024[8] - Loans receivables in current assets decreased from 91,557,170 HKD at the end of 2023 to 58,964,068 HKD as of June 30, 2024[8] Unaudited Condensed Consolidated Statement of Changes in Equity For H1 2024, total equity decreased due to comprehensive loss, further expanding accumulated losses Key Data from Statement of Changes in Equity (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Total equity at beginning of period | 124,441,577 HKD | 279,602,892 HKD | | Total comprehensive loss for the period | (41,804,195 HKD) | (25,402,909 HKD) | | Total equity at end of period | 82,637,382 HKD | 254,199,983 HKD | | Accumulated losses (end of period) | (701,360,565 HKD) | (532,005,964 HKD) | Unaudited Condensed Consolidated Statement of Cash Flows For H1 2024, cash and cash equivalents saw a net decrease from operating and financing activities Key Data from Statement of Cash Flows (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Net cash used in operating activities | (3,495,247 HKD) | (20,812,486 HKD) | | Net cash from investing activities | 1,368,601 HKD | 7,072,379 HKD | | Net cash used in financing activities | (122,402 HKD) | (834,986 HKD) | | Net decrease in cash and cash equivalents | (2,249,048 HKD) | (14,575,093 HKD) | | Cash and cash equivalents at end of period | 1,491,092 HKD | 5,261,618 HKD | Notes to the Unaudited Condensed Consolidated Financial Statements 1. BASIS OF PREPARATION Interim financials follow HKAS 34 and GEM rules, consistent with 2023 annuals, unaudited, with shares suspended - Financial statements are prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the HKICPA and the GEM Listing Rules[11] - The accounting policies and calculation methods adopted are consistent with those used in the annual financial statements for the year ended December 31, 2023[11] - As of the report approval date, the company's shares remain suspended from trading[11] 2. ADOPTION OF NEW AND REVISED HONG KONG FINANCIAL REPORTING STANDARDS The Group adopted new HKFRS amendments this period, with no significant impact on performance or financial position - The Group first applied amendments to HKFRS 16, HKAS 1, HKAS 7, and HKFRS 7[11] - These amendments had no significant impact on the Group's performance, financial position, or financial statement disclosures for the current and prior periods[11] 3. FAIR VALUE MEASUREMENTS Financial assets and liabilities approximate fair value, measured using a three-level hierarchy of inputs - The carrying amounts of the Group's financial assets and financial liabilities approximate their respective fair values[12] - Fair value measurements adopt a three-level hierarchy: Level 1 (quoted prices in active markets), Level 2 (directly or indirectly observable inputs), and Level 3 (unobservable inputs)[12] 4. SEGMENT INFORMATION For H1 2024, all revenue came from Hong Kong credit financing; no segment analysis presented; top five clients contributed 84.0% - All Group revenue is derived from credit financing business provided and arranged in Hong Kong, with revenue being loan interest income[12] - Due to resource integration and no disaggregated financial information, no segment analysis or product/service information is presented[12] Customer Revenue Contribution (As of June 30, 2024) | Customer Type | Revenue Share | | :--- | :--- | | Five largest customers | 84.0% | | Largest customer | 24.6% | 5. REVENUE For H1 2024, revenue significantly dropped to 912,469 HKD, mainly from loan interest, with no impaired loan interest Revenue Composition (For the six months ended June 30) | Revenue Source | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Interest income from loan financing | 912,469 HKD | 17,159,460 HKD | - For the six months ended June 30, 2024, interest income from credit-impaired loans receivables was zero HKD, compared to 13,036,219 HKD in the same period of 2023[14][15] 6. OTHER INCOME For H1 2024, other income, primarily bank interest, slightly increased year-on-year Other Income (For the six months ended June 30) | Income Source | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Bank interest income | 3,518 HKD | 3,145 HKD | 7. OTHER LOSS For H1 2024, other loss significantly decreased due to reduced net fair value loss on FVTPL financial assets Other Loss Composition (For the six months ended June 30) | Loss Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Loss on disposal of property, plant and equipment | – | (274,751 HKD) | | Realized gain on financial assets at FVTPL | 44,174 HKD | 239,876 HKD | | Net fair value loss on financial assets at FVTPL | (210,987 HKD) | (2,120,408 HKD) | | Total other loss | (166,813 HKD) | (2,155,283 HKD) | 8. FINANCE COSTS For H1 2024, finance costs decreased, mainly from interest on bonds payable and lease liabilities Finance Costs Composition (For the six months ended June 30) | Expense Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Interest on bonds payable | 42,384 HKD | – | | Interest on lease liabilities | 9,870 HKD | 102,873 HKD | | Total finance costs | 52,254 HKD | 102,873 HKD | 9. LOSS BEFORE TAX For H1 2024, loss before tax was impacted by increased loan impairment, offset by reduced depreciation and employee benefits Loss Before Tax Deductions (For the six months ended June 30) | Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | – | 429,429 HKD | | Depreciation of right-of-use assets | – | 696,431 HKD | | Legal and professional fees | 991,660 HKD | 1,177,652 HKD | | Directors' remuneration | 1,206,720 HKD | 1,215,000 HKD | | Employee benefits expense (excluding directors' remuneration) | 1,040,939 HKD | 2,968,448 HKD | | Net impairment loss on loans receivables | 37,512,734 HKD | 31,430,381 HKD | 10. INCOME TAX EXPENSE For H1 2024, no income tax expense was recorded, unlike prior year's deferred tax; HK profits tax uses a two-tiered system Income Tax Expense (For the six months ended June 30) | Tax Type | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Current tax – Hong Kong profits tax | – | – | | Deferred tax – expense | – | 9,792 HKD | | Total income tax expense | – | 9,792 HKD | - Hong Kong profits tax adopts a two-tiered system, with a tax rate of 8.25% for the first 2 million HKD of assessable profits and 16.5% for the remainder[22][24] 11. DIVIDENDS The Board recommends no interim dividends for shareholders for H1 2024 and 2023 - The directors do not recommend paying any interim dividends to shareholders for the six months ended June 30, 2024, and 2023[23][25] 12. LOSS PER SHARE For H1 2024, basic loss per share widened to 1.15 HK cents (vs. 0.70 HK cents in 2023), with diluted loss being identical Loss Per Share (For the six months ended June 30) | Metric | 2024 (HK cents) | 2023 (HK cents) | | :--- | :--- | :--- | | Basic loss per share | (1.15 HK cents) | (0.70 HK cents) | | Diluted loss per share | (1.15 HK cents) | (0.70 HK cents) | - Basic loss per share is calculated based on the loss attributable to owners of the company of 41,804,195 HKD (2023: 25,402,909 HKD) and the weighted average number of ordinary shares in issue of 3,628,800,000 shares[26][29] - As the company had no potential dilutive ordinary shares during the reporting period, diluted loss per share is identical to basic loss per share[27][30] 13. PROPERTY, PLANT AND EQUIPMENT For H1 2024, no property, plant, and equipment acquisitions or disposals occurred, unlike prior year - For the six months ended June 30, 2024, the Group made no acquisitions of property, plant, and equipment (2023: 645,500 HKD)[28][31] - For the six months ended June 30, 2024, the Group recorded no loss on disposal of property, plant, and equipment (2023: 274,751 HKD)[28][31] 14. LOANS RECEIVABLES As of June 30, 2024, total loans receivables decreased, impairment provisions rose, reducing net loans; impaired loans increased Loans Receivables Composition (As of June 30) | Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Fixed-rate loans receivables | 576,645,956 HKD | 580,940,605 HKD | | Accrued interest receivables | 96,751,727 HKD | 96,101,425 HKD | | Total loans receivables | 673,397,683 HKD | 677,042,030 HKD | | Less: Individually assessed expected credit losses | (429,012,171 HKD) | (395,033,294 HKD) | | Collectively assessed expected credit losses | (183,261,444 HKD) | (183,261,444 HKD) | | Expected credit losses on accrued interest receivables | (2,160,000 HKD) | (2,160,000 HKD) | | Net loans receivables | 58,964,068 HKD | 96,587,292 HKD | | Of which: Non-current | – | 5,030,122 HKD | | Of which: Current | 58,964,068 HKD | 91,557,170 HKD | - The effective interest rate for fixed-rate loans receivables ranges from 8.5% to 46%[33][35] Loans Receivables Credit Quality Analysis (As of June 30) | Credit Quality | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Neither past due nor impaired (unsecured) | 2,073,959 HKD | 21,180,690 HKD | | Impaired | 671,323,724 HKD | 655,830,162 HKD | | Total | 673,397,683 HKD | 677,042,030 HKD | - As of June 30, 2024, total impaired loans receivables amounted to 671,323,724 HKD, an increase from 655,830,162 HKD at the end of 2023[36] 15. FINANCIAL ASSETS AT FVTPL As of June 30, 2024, the company held no FVTPL financial assets, compared to 1,531,896 HKD in 2023 Financial Assets at FVTPL (As of June 30) | Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Financial assets mandatorily at FVTPL – Hong Kong listed equity securities | – | 1,531,896 HKD | | Analyzed as: Current assets | – | 1,531,896 HKD | - These financial assets refer to investments in listed equity securities that offer return opportunities through dividend income and fair value gains, with no fixed maturity or coupon rate[39] 16. SHARE CAPITAL As of June 30, 2024, authorized and issued share capital remained unchanged at 5 billion HKD and 72.58 million HKD Share Capital Structure (As of June 30) | Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Authorized: 250,000,000,000 ordinary shares of 0.02 HKD each | 5,000,000,000 HKD | 5,000,000,000 HKD | | Issued and fully paid: 3,628,800,000 ordinary shares of 0.02 HKD each | 72,576,000 HKD | 72,576,000 HKD | 17. RELATED PARTY TRANSACTIONS For H1 2024, total remuneration to key management personnel slightly decreased Key Management Personnel Remuneration (For the six months ended June 30) | Remuneration Item | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Short-term employee benefits (including salaries, paid annual leave and sick leave) | 1,191,720 HKD | 1,200,000 HKD | | Performance-related bonuses | – | – | | Pension scheme contributions | 15,000 HKD | 15,000 HKD | | Total | 1,206,720 HKD | 1,215,000 HKD | 18. CONTINGENT LIABILITIES As of June 30, 2024, the company recorded no significant contingent liabilities, consistent with 2023-end - As of June 30, 2024, the Group recorded no significant contingent liabilities (December 31, 2023: nil)[46][47] Management Discussion and Analysis Business Review and Prospects During the period, the company focused on money lending with a cautious strategy due to slow HK economic recovery, leading to decreased interest income; plans include stricter client screening and enhanced debt collection - The Group continues to focus on its money lending business, providing secured and unsecured loans to individuals, corporations, and foreign domestic helpers[49] - Slower-than-expected economic recovery in Hong Kong led the company to adopt a more cautious approach to new loan disbursements, resulting in decreased interest income for fiscal years 2023 and 2024[49] - The company plans to focus on acquiring high-quality individual clients for personal loans in 2024, implementing stricter client selection criteria and enhancing collection efforts by the credit control department and debt collection agents[49] Business Outlook The company will maintain money lending revenue and credit quality, monitoring capital to seize opportunities and maximize shareholder value - The Group remains committed to maintaining the revenue and credit quality of its money lending business[51] - The Group will continuously monitor its capital base to ensure sufficient funds are maintained to capitalize on various potential opportunities[51] Financial Review During the period, poor financial performance saw significant revenue decline, narrowed net interest margin, and expanded loss Revenue During the period, revenue significantly decreased to approx 0.91 million HKD, mainly from reduced impaired loan interest Revenue Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Revenue | approx 0.91 million HKD | approx 17.16 million HKD | - The decrease in revenue is primarily attributable to reduced accrued interest on credit-impaired loans receivables during the review period[51] Net Interest Margin During the period, money lending net interest margin was approx 8.19%, down from approx 13.44% in prior year Net Interest Margin Changes (For the six months ended June 30) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net Interest Margin | approx 8.19% | approx 13.44% | - The decline in net interest margin primarily reflects changes in the ratio of net interest income to the average balance of adjusted total loans receivables[51] Other Loss During the period, other loss significantly decreased to approx 0.17 million HKD, due to reduced fair value losses on listed securities Other Loss Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Other Loss | approx 0.17 million HKD | approx 2.16 million HKD | - The decrease in other loss is mainly attributable to reduced fair value losses on financial assets at FVTPL[52][55] Administrative Expenses During the period, administrative expenses decreased to approx 2.62 million HKD, mainly from lower employee and depreciation costs Administrative Expenses Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Administrative Expenses | approx 2.62 million HKD | approx 6.01 million HKD | - Administrative expenses primarily comprise employee expenses, office rental costs, and depreciation charges[53][56] - The reduction in administrative expenses is mainly due to decreased employee expenses and depreciation charges[53][56] Impairment Loss on Loans Receivables During the period, loan impairment loss increased to approx 37.51 million HKD due to overdue loans; the Group uses combined collective and individual ECL assessments Impairment Loss on Loans Receivables Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Impairment Loss | approx 37.51 million HKD | approx 31.43 million HKD | - The increase in impairment loss is primarily due to a rise in overdue loans receivables during the review period[57][58] - The Group conducts collective assessments at least quarterly and individual assessments monthly, considering factors such as probability of default, loss given default, expected recovery dates, and fair value of collateral[59][60][62] Other Operating Expenses During the period, other operating expenses decreased to approx 2.37 million HKD, mainly from reduced promotion and professional fees Other Operating Expenses Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Other Operating Expenses | approx 2.37 million HKD | approx 2.86 million HKD | - Other operating expenses primarily include legal and professional fees, audit fees, and other general expenses[63] - The decrease in expenses is mainly attributable to reduced promotion and professional fees[63] Finance Costs During the period, finance costs decreased to approx 0.05 million HKD, including lease and bond interest Finance Costs Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Finance Costs | approx 0.05 million HKD | approx 0.10 million HKD | - Finance costs primarily include interest on lease liabilities and interest on bonds payable[64] Loss for the Period During the period, consolidated loss widened to approx 41.80 million HKD, due to increased loan impairment and decreased revenue Loss for the Period Changes (For the six months ended June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Consolidated Loss Attributable to Owners | approx 41.80 million HKD | approx 25.40 million HKD | - The widened loss is primarily attributable to increased impairment losses on loans receivables and decreased revenue[64] Liquidity, Financial Resources and Capital Structure As of June 30, 2024, bank and cash balances, net current assets, and current ratio decreased; the Board deems cash satisfactory; no bank borrowings, may seek external financing Liquidity Indicators (As of June 30) | Metric | 2024 (HKD) | 2023 (HKD) | | :--- | :--- | :--- | | Bank and cash balances | approx 1.49 million HKD | approx 3.74 million HKD | | Net current assets | approx 60.62 million HKD | approx 97.46 million HKD | | Current Ratio | approx 34.82 times | approx 50.55 times | - The decrease in current ratio is mainly due to reduced loans receivables for the six months ended June 30, 2024[64] - The company has no bank borrowings and may raise funds through independent third-party and bank loans or by issuing equity/loan notes[64] Significant Investments Held As of June 30, 2024, the company held no significant investments exceeding 5% of total Group assets - As of June 30, 2024, the Group held no significant investments exceeding 5% of its total assets[66][69] Material Acquisition and Disposal and Future Plans for Material Investments or Capital Assets During the period, no material acquisitions or disposals of subsidiaries, associates, or joint ventures occurred; no future plans for material investments or capital assets as of June 30, 2024 - During the review period, the Group made no material acquisitions or disposals of subsidiaries, associates, or joint ventures[67][69] - As of June 30, 2024, the Group had no specific future plans for material investments or capital assets[67][69] Information on Employees As of June 30, 2024, total employees decreased to 8, with lower remuneration; compensation is performance-based, with regular training Employee Information (As of June 30) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Total Employees | 8 | 23 | | Total Employee Remuneration (For the six months ended June 30) | approx 2.25 million HKD | approx 4.18 million HKD | - The company's remuneration policy is determined based on individual employee performance, qualifications, and experience, referencing current market conditions, and includes fixed monthly salaries and discretionary year-end bonuses[70] - The Group adopts an employee training and development policy, providing regular training on the money lending industry, anti-money laundering, and anti-corruption[70] Charges on the Group's Assets As of June 30, 2024, approx **8