声扬集团(08163) - 2024 - 中期财报

Company Information The report lists fundamental company information including board members, committee compositions, registered office, principal bankers, and auditors Company Information | Role | Personnel/Institution | | :--- | :--- | | Executive Director | Mr. Wang Xianshuo (Chairman and Chief Executive Officer) | | Independent Non-Executive Directors | Ms. Ng Ka Sin, Mr. Wong Wing Kit, Ms. Yeung Mo Sheung | | Company Secretary | Mr. Au Kai Yin | | Auditor | Kaiyuan Xinde Certified Public Accountants Limited | | Principal Bankers | Hang Seng Bank Limited, Bank of Communications (Hong Kong) Limited | Financial Statements Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2024, the Group's revenue grew 61.1% to HKD 8.105 million, but net loss expanded to HKD 15.324 million due to higher costs and finance charges Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Item | For the Six Months Ended June 30, 2024 (HKD Thousands) | For the Six Months Ended June 30, 2023 (HKD Thousands) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Revenue | 8,105 | 5,031 | +61.1% | | Gross Profit | 3,650 | 5,031 | -27.5% | | Operating and Administrative Expenses | (12,531) | (13,743) | -8.8% | | Finance Costs | (6,843) | (6,409) | +6.8% | | Loss for the Period | (15,324) | (13,730) | +11.6% | | Basic Loss Per Share (HK Cents) | (2.54) | (2.42) | +5.0% | Condensed Consolidated Statement of Financial Position As of June 30, 2024, total assets were HKD 54.697 million, while total liabilities increased to HKD 104.825 million primarily due to convertible bonds, leading to an expanded net deficit of HKD 50.128 million Condensed Consolidated Statement of Financial Position | Item | As of June 30, 2024 (HKD Thousands) | As of December 31, 2023 (HKD Thousands) | | :--- | :--- | :--- | | Non-Current Assets | 24,712 | 27,961 | | Current Assets | 29,985 | 28,752 | | Total Assets | 54,697 | 56,713 | | Current Liabilities | 20,208 | 13,196 | | Non-Current Liabilities | 84,617 | 78,321 | | Of which: Convertible Bonds | 84,235 | 77,931 | | Total Liabilities | 104,825 | 91,517 | | Net Liabilities | (50,128) | (34,804) | - The Group's bank balances and cash (general accounts) significantly decreased from HKD 14.127 million at the beginning of the period to HKD 6.387 million at the end[6][10] Condensed Consolidated Statement of Changes in Equity As of June 30, 2024, the Group's total deficit (total equity) worsened from HKD -34.804 million to HKD -50.128 million due to a HKD 15.324 million loss incurred during the period - The HKD 15,324 thousand loss for the period was the sole reason for the decrease in total shareholders' equity[9] Condensed Consolidated Statement of Cash Flows Net cash outflow from operating activities expanded to HKD 16.747 million, leading to a net decrease of HKD 7.740 million in cash and cash equivalents, with an ending balance of HKD 6.387 million Condensed Consolidated Statement of Cash Flows | Item | For the Six Months Ended June 30, 2024 (HKD Thousands) | For the Six Months Ended June 30, 2023 (HKD Thousands) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (16,747) | (9,335) | | Net Cash Generated from Investing Activities | 149 | 160 | | Net Cash Generated From/(Used In) Financing Activities | 8,858 | (2,366) | | Net Decrease in Cash and Cash Equivalents | (7,740) | (11,541) | | Bank Balances and Cash at Beginning of Period | 14,127 | 23,031 | | Bank Balances and Cash at End of Period | 6,387 | 11,490 | Notes to the Financial Statements Revenue and Segment Reporting The Group's total revenue increased by 61.1% to HKD 8.105 million, primarily driven by financial services and corporate advisory, though digital business segment loss expanded, with all revenue from Hong Kong Revenue and Segment Profit/(Loss) by Business Segment | Business Segment | 2024 H1 Revenue (HKD Thousands) | 2023 H1 Revenue (HKD Thousands) | 2024 H1 Segment Profit/(Loss) (HKD Thousands) | 2023 H1 Segment Profit/(Loss) (HKD Thousands) | | :--- | :--- | :--- | :--- | :--- | | Financial Services Business | 3,787 | 2,343 | 1,375 | 414 | | Corporate Advisory Business | 3,436 | 2,279 | 2,874 | 1,511 | | Digital Business | 882 | 409 | (6,220) | (2,333) | | Total | 8,105 | 5,031 | (1,971) | (408) | - The Group's operations are categorized into three main segments: financial services, corporate advisory, and digital business, with financial services encompassing corporate finance, asset management, and money lending, while digital business leverages blockchain and AI technologies and invests in entertainment activities[14] - During the period, two major clients (Client A and Client B) each contributed over 10% of total revenue, both from the financial services and corporate advisory segments[18] Loans Receivable As of June 30, 2024, total loans and interest receivable were HKD 4.859 million, with a net carrying value of HKD 3.839 million after provisions, and an impairment loss reversal of approximately HKD 91 thousand was recognized Loans Receivable | Item | As of June 30, 2024 (HKD Thousands) | As of December 31, 2023 (HKD Thousands) | | :--- | :--- | :--- | | Total Loans and Interest Receivable | 4,859 | 5,272 | | Less: Provision for Impairment Loss | (1,020) | (1,111) | | Net Carrying Value | 3,839 | 4,161 | - Loans receivable are from three independent third parties and are unsecured, with an impairment loss reversal of HKD 91 thousand recognized during the period[37] Convertible Bonds As of June 30, 2024, the Group's two outstanding convertible bonds had a total liability carrying value of HKD 84.235 million, an increase from year-start, potentially leading to significant new share issuance upon full conversion Convertible Bonds | Item | As of June 30, 2024 (HKD Thousands) | As of December 31, 2023 (HKD Thousands) | | :--- | :--- | :--- | | 2022 Convertible Bonds | 75,895 | 70,214 | | 2023 Convertible Bonds | 8,340 | 7,717 | | Total | 84,235 | 77,931 | - The 2022 convertible bond has a principal amount of HKD 91 million, and the 2023 convertible bond has a principal amount of HKD 10 million, both held by the major shareholder, Huilang International Holdings Limited[45][46] Events After Reporting Period On July 22, 2024, the Group's subsidiary secured a put option to require NOIZChain's vendor to repurchase its entire share capital at the original acquisition price, valid until end of 2024 or extendable to June 30, 2025 - The Group obtained a put option, granting it the right to require NOIZChain's original shareholders to repurchase the company in the future, providing a potential exit or risk control mechanism for this digital business investment[50][74] Management Discussion and Analysis Financial and Business Review In H1 2024, total revenue grew due to strong financial services and corporate advisory, but expanded digital business losses and high finance costs led to an overall increase in the Group's net loss - Financial services business revenue grew by 62.1% to HKD 3.8 million, with segment profit increasing by 232% to HKD 1.4 million[52] - Corporate advisory business revenue increased by 49.2% to HKD 3.4 million, and segment profit grew by 92% to HKD 2.9 million[55] - Digital business revenue increased by 117% to HKD 0.9 million, but segment loss expanded from HKD 2.3 million to HKD 6.2 million, primarily due to delayed projects caused by subdued market sentiment[56] Prospects The Group seeks new investments, with digital business focusing on blockchain IP and entertainment, financial services exploring US expansion and virtual asset investments, and corporate advisory anticipating stable demand - Digital business focuses on intellectual property management using NOIZ Green Chain, investing in live concerts, and collaborating with Proto Inc. for holographic product distribution in Vietnam[60] - Financial services are considering expansion into regions like the US and seeking new opportunities in CIES asset management and virtual asset investments[61] Financial Resources, Liquidity and Gearing Ratio As of June 30, 2024, the Group's financial position faced pressure, with cash and bank balances decreasing to HKD 6.4 million, net current assets reducing, and the gearing ratio increasing from 1.37 to 1.54, indicating higher leverage Financial Resources, Liquidity and Gearing Ratio | Metric | As of June 30, 2024 | As of December 31, 2023 | | :--- | :--- | :--- | | Cash and Bank Balances | Approx. HKD 6.4 Million | Approx. HKD 14.2 Million | | Net Current Assets | Approx. HKD 9.8 Million | Approx. HKD 15.6 Million | | Gearing Ratio | Approx. 1.54 | Approx. 1.37 | Corporate Governance and Other Information Share Option Scheme As of June 30, 2024, 1,816,214 share options remained unexercised under the share option scheme, with 4,349,836 options lapsing and no new grants or exercises during the period - 4,349,836 share options granted to consultants lapsed during the period[75][76][77] Directors' and Chief Executive's Interests in the Company's Securities Chairman and CEO Mr. Wang Xianshuo, through his wholly-owned company Huilang, holds 125.13% of the issued share capital via shares and convertible bonds, making him the controlling shareholder - Mr. Wang Xianshuo holds 174,421,666 shares and 581,839,903 underlying shares (from convertible bonds) through his controlled corporation Huilang, totaling approximately 125.13% of the total share capital[81][82] Compliance with Corporate Governance Code The Group complied with most Corporate Governance Code provisions, with one deviation: Chairman and CEO roles are combined in Mr. Wang Xianshuo, though the Board believes existing safeguards ensure power balance - The Company deviates from Corporate Governance Code provision C.2.1, where the Chairman and Chief Executive roles are held by the same individual, Mr. Wang Xianshuo; however, the Board believes that power is not overly concentrated as major decisions are deliberated by the Board and three independent non-executive directors provide independent opinions[90]