Financial Performance - Revenue for the six months ended June 30, 2024, was HKD 8,651,000, compared to HKD 16,914,000 for the same period in 2023, representing a decrease of 48.8%[2] - Gross profit for the same period was HKD 2,051,000, down from HKD 4,856,000 in 2023, indicating a decline of 57.8%[2] - The company reported a loss before tax of HKD 9,549,000 for the six months ended June 30, 2024, compared to a loss of HKD 8,175,000 in 2023, reflecting an increase in losses of 16.8%[2] - The company reported a total comprehensive loss attributable to owners of HKD 9,436,000 for the period, compared to a loss of HKD 8,165,000 in 2023, an increase of 15.5%[2] - The basic and diluted loss per share for the period was HKD 2.30, compared to HKD 2.20 in the previous year, indicating a slight increase in loss per share of 4.5%[2] - The total reported segment loss for the six months ended June 30, 2024, was HKD 5,430,000, compared to a loss of HKD 4,887,000 in the same period of 2023, indicating an increase in losses[20] - The pre-tax loss for the six months ended June 30, 2024, was HKD 9,549,000, compared to HKD 8,175,000 for the same period in 2023, reflecting a worsening financial position[20] - The group recorded a net loss attributable to shareholders of approximately HKD 9,549,000, compared to a loss of HKD 8,443,000 in the same period last year[52] Assets and Liabilities - Total current assets decreased to HKD 6,744,000 as of June 30, 2024, from HKD 13,252,000 as of December 31, 2023, a decline of 49.1%[3] - Current liabilities totaled HKD 57,729,000 as of June 30, 2024, down from HKD 66,383,000 at the end of 2023, a reduction of 13.5%[3] - Non-current liabilities increased significantly to HKD 17,109,000 as of June 30, 2024, compared to HKD 6,975,000 at the end of 2023, an increase of 145.5%[4] - The total assets as of June 30, 2024, were HKD 7,386,000, compared to HKD 14,033,000 as of June 30, 2023, indicating a significant reduction in asset base[20] - The total liabilities as of June 30, 2024, were HKD 74,838,000, compared to HKD 73,358,000 as of June 30, 2023, showing a slight increase in liabilities[20] - The debt-to-asset ratio as of June 30, 2024, was approximately 1,013.2%, up from 522.8% on December 31, 2023[62] - The group recorded an asset loss of approximately HKD 67,452,000 as of June 30, 2024, compared to HKD 59,325,000 on December 31, 2023[62] Cash Flow and Financing - The company’s cash and cash equivalents decreased to HKD 854,000 as of June 30, 2024, from HKD 997,000 at the end of 2023, a decrease of 14.4%[3] - As of June 30, 2024, the company had cash and cash equivalents of approximately HKD 854,000 available to meet its financial obligations[8] - The company has received a commitment letter from Executive Director Mr. Qin, agreeing not to demand repayment of a loan amounting to HKD 8,000,000 until the company is able to repay[8] - Mr. Zhao has provided loans totaling approximately HKD 21,271,000, with HKD 16,456,000 of this amount deferred until 2026[9] - The company has established a loan financing agreement with an independent third party for up to HKD 40,000,000, with an annual interest rate of 20%[10] - The company is actively seeking additional financing sources and is committed to strict cost management measures to optimize operational efficiency[10] - The company has not utilized the external financing facility as of June 30, 2024[10] Business Operations - The company continues to engage in leather manufacturing, retail, and industrial hemp cultivation, with no significant changes in its core business operations during the reporting period[5] - The leather manufacturing business reported external customer revenue of HKD 8,353,000 for the six months ended June 30, 2024, compared to HKD 16,473,000 in the same period of 2023, representing a decrease of 49.3%[20] - The leather retail business generated external customer revenue of HKD 298,000 for the six months ended June 30, 2024, down from HKD 441,000 in the same period of 2023, a decline of 32.4%[20] - The leather manufacturing segment accounted for approximately 96.6% of total revenue, while the leather retail business accounted for about 3.4%[53] - The group has initiated a diversification plan into industrial hemp cultivation and hemp textile production, with relevant permits obtained[59] Impairment and Asset Valuation - The impairment loss on right-of-use assets was HKD 1,224,000 for the six months ended June 30, 2024, compared to HKD 896,000 in the same period of 2023, indicating increased asset impairment[22] - The leather retail business incurred significant losses in the six months ending June 30, 2024, leading to indications of impairment for related assets[30] - The recoverable amount for the retail cash-generating unit was determined to be zero, based on a value-in-use calculation using a discount rate of 13%[30] - The leather manufacturing business also experienced substantial losses, resulting in impairment indications for its assets as of June 30, 2024[31] - The recoverable amount for the manufacturing cash-generating unit was similarly estimated to be zero, using the same discount rate of 13%[31] Corporate Governance and Compliance - The audit committee consists of three independent non-executive directors as of June 30, 2024, and has reviewed the financial reporting procedures and internal controls[75] - The interim financial information for the six months ending June 30, 2024, has not been audited or reviewed by external auditors but has been discussed with the management[75] - The company has complied with the corporate governance code except for the absence of an internal audit function as of June 30, 2024[72] - The company will regularly review its corporate governance practices to ensure ongoing compliance with the corporate governance code[72] Employee and Management Information - As of June 30, 2024, the group employed 115 employees, a decrease from 126 employees as of December 31, 2023[68] - The short-term benefits for key management personnel for the six months ended June 30, 2024, amount to HKD 450,000, down from HKD 585,000 for the same period in 2023[50]
中联发展控股(00264) - 2024 - 中期业绩