Company Overview - SK Target Group Limited is incorporated in the Cayman Islands and listed on the GEM of the Hong Kong Stock Exchange, which is designed for small and mid-sized companies with higher investment risks[1]. - The company acknowledges the potential risks associated with investing in GEM-listed companies, including susceptibility to high market volatility[2]. - The directors of SK Target Group Limited confirm that the information in the report is accurate and complete in all material respects, ensuring no misleading statements are present[3]. Financial Performance - The Group's revenue slightly increased by approximately 1.25%, from approximately RM30.3 million for the year ended 31 May 2023 to approximately RM30.7 million for the year ended 31 May 2024[16]. - Revenue from the manufacturing and trading of precast concrete junction boxes increased by approximately 20.16%, while the other building materials and services business segment increased by approximately 4.19%[9]. - The sale of health supplement products decreased by 100% due to a change in business strategy[9]. - The Group remains cautiously optimistic about overall business prospects despite challenges such as labor shortages and rising material costs[15]. - The increase in revenue is attributed to the steady improvement of the Malaysian economy following the recovery from COVID-19[14]. - The Group recorded a net profit of approximately RM108,000 for the year ended 31 May 2024, compared to RM88,000 for the previous year, driven by increased revenue and decreased cost of sales[20]. Revenue Sources - The Group's revenue is primarily derived from non-recurrent infrastructure upgrades and construction projects, with no guarantee of future purchase orders from customers[21]. - Revenue from the manufacturing and trading of precast concrete junction boxes increased by approximately 20.16%, from approximately RM24.4 million for the year ended 31 May 2023 to approximately RM29.3 million for the year ended 31 May 2024[19]. - Revenue from the trading of accessories and pipes and mobile crane rental services slightly increased by approximately 4.19%, from approximately RM1.3 million to approximately RM1.4 million for the same periods[19]. Cost and Expenses - The total cost of sales for precast concrete junction boxes increased from approximately RM18.7 million to approximately RM21.0 million, representing an increase of approximately 12.42%[19]. - Gross profit increased from approximately RM6.9 million to approximately RM8.6 million, attributed to a focus on higher profit margin products and better expense control[19]. - Administrative expenses increased by approximately RM1.7 million or 38.74%, from approximately RM4.3 million to approximately RM6.0 million, mainly due to increased staff costs and director remuneration[20]. - Selling and distribution expenses increased by approximately RM0.13 million or 10.15%, from approximately RM1.23 million to approximately RM1.36 million, primarily due to increased bonuses and commissions[20]. Financial Position - As of 31 May 2024, the Group recorded trade receivables amounting to approximately RM8.6 million, with a trade receivables turnover of approximately 106 days, exceeding the stipulated credit period[22]. - The average trade payable turnover days were approximately 79 days, indicating potential liquidity risk due to cash flow mismatches[22]. - As of May 31, 2024, the Group's cash and cash equivalents amounted to approximately RM28.2 million, slightly up from RM28.1 million as of May 31, 2023[24]. - The Group had no bank borrowings as of May 31, 2024, indicating a strong financial position[25]. - The current ratio as of May 31, 2024, was 3.00, down from 3.61 as of May 31, 2023, reflecting a decrease in liquidity[24]. Corporate Governance - The Group has a structured corporate governance framework, details of which are provided in the Corporate Governance Report[54]. - The Board is dedicated to high standards of corporate governance, enhancing accountability, transparency, and internal control systems[106]. - The Company has adopted a code of conduct regarding securities transactions by the Directors, confirming compliance for the year ended May 31, 2024[111]. - The Company emphasizes the importance of good corporate governance for effective management and successful business development[109]. Shareholder Information - The Board does not recommend the payment of a final dividend for the year ended May 31, 2024, consistent with the previous year where no dividend was paid[55]. - The Company has adopted a Dividend Policy that considers financial results, cash flow situation, business conditions, future operations, capital requirements, and shareholder interests when determining dividends[162]. - The declaration and payment of dividends are at the sole discretion of the Board and subject to restrictions under applicable laws and regulations[163]. Audit and Compliance - The financial statements for the year ended 31 May 2024 have been audited by McMillan, who will offer themselves for re-appointment at the upcoming AGM[103]. - The audit committee assists the directors in overseeing the Group's financial reporting process[191]. - The auditors evaluate the appropriateness of accounting policies and the reasonableness of accounting estimates made by the directors[196]. - The audit process includes obtaining sufficient and appropriate audit evidence to provide a basis for the auditors' opinion[193]. Risk Management - The Group's internal control and risk management systems are designed to provide reasonable assurance against material misstatement or loss[157]. - An independent internal control consultant conducted an annual review of the effectiveness of the Group's risk management and internal control systems for the year ended May 31, 2024[160]. - The management is responsible for establishing and reviewing the internal control system underpinning the risk management framework[159]. Future Plans - The management is committed to seeking business opportunities that would generate long-term returns for shareholders[10]. - The Company has a clear strategy for market expansion and product development in its core business areas[50].
万顺瑞强集团(08427) - 2024 - 年度财报