伟鸿集团控股(03321) - 2024 - 中期财报

Company Information Company Overview This section provides fundamental information about Wai Hung Group Holdings Limited, including details on its board members, committee compositions, registered office, principal place of business, auditor, legal advisors, and share registrar - Mr. Li Kam Hung serves as the Chairman and Chief Executive Officer, with Mr. Yu Ming Ho and Mr. Yau Yan Ming as Executive Directors[2] - The Company Secretary changed from Mr. Lam Wai Kei to Mr. Wong Sze Lok on February 8, 2024[2] Management Discussion and Analysis Business Review and Outlook The Group, a decoration and maintenance service contractor in Macau and Hong Kong, primarily serving commercial facilities within Macau's integrated resorts, anticipates increased tender opportunities from casino-related projects as Macau's tourism recovers post-COVID-19, supporting a gradual financial performance recovery - The Group's core business involves providing decoration and maintenance services in Macau and Hong Kong, primarily for licensed casino gaming operators in Macau[5] - With the recovery of Macau's tourism industry, the company expects an increase in casino-related project tenders, creating business opportunities for the Group[5] Financial Review During the reporting period, the Group's financial performance significantly deteriorated, with total revenue plummeting by 89.5% year-on-year, declining gross profit and margin, and a substantial impairment loss due to a key debtor's liquidation, coupled with doubled administrative expenses, resulting in a net loss of MOP 58.6 million, a 630.2% increase Revenue Analysis For the six months ended June 30, 2024, the Group's total revenue was MOP 6.1 million, a significant 89.5% decrease from MOP 58.4 million in the prior year | Metric | Six Months Ended June 30, 2024 (MOP Million) | Six Months Ended June 30, 2023 (MOP Million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Total Revenue | 6.1 | 58.4 | -89.5% | Gross Profit and Gross Margin Analysis During the reporting period, gross profit decreased from MOP 2.0 million to MOP 0.2 million, with the gross margin declining from 3.5% to 2.9%, primarily due to projects with lower profit margins recognized during the period | Metric | Six Months Ended June 30, 2024 (MOP Million) | Six Months Ended June 30, 2023 (MOP Million) | | :--- | :--- | :--- | | Gross Profit | 0.2 | 2.0 | | Gross Margin | 2.9% | 3.5% | Impairment Loss Analysis The reporting period saw a total impairment loss provision of approximately MOP 42.8 million for financial and contract assets, compared to a reversal of MOP 0.4 million in the prior year, primarily due to a debtor's liquidation order by the Hong Kong High Court - The Group recognized an impairment loss of approximately MOP 42.8 million due to a debtor's liquidation order, a primary contributor to the period's expanded loss[11] Administrative Expenses Analysis Administrative expenses increased by approximately 100% from MOP 7.2 million to MOP 14.4 million, primarily driven by a rise in administrative staff costs from MOP 3.5 million to MOP 8.2 million | Metric | Six Months Ended June 30, 2024 (MOP Million) | Six Months Ended June 30, 2023 (MOP Million) | | :--- | :--- | :--- | | Administrative Expenses | 14.4 | 7.2 | | Administrative Staff Costs | 8.2 | 3.5 | Loss for the Period Analysis The loss for the period was approximately MOP 58.6 million, a substantial increase of MOP 50.6 million or 630.2% compared to the MOP 8.0 million loss in the prior year | Metric | Six Months Ended June 30, 2024 (MOP Million) | Six Months Ended June 30, 2023 (MOP Million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Loss for the Period | 58.6 | 8.0 | +630.2% | Company Finance and Risk Management As of the reporting period end, the Group's cash position declined, bank borrowings slightly increased, and the gearing ratio significantly decreased due to a substantial negative total equity, reflecting a more severe financial state; the Group maintains prudent treasury policies and continuously monitors foreign currency risk, primarily from HKD - As of June 30, 2024, the Group's bank and cash equivalents were approximately MOP 17.3 million, a 12.4% decrease from the end of 2023[16] - As of June 30, 2024, the gearing ratio was approximately 86.7%, a significant decrease from 1,768.0% at the end of 2023, primarily due to total equity deteriorating from negative MOP 15.9 million to negative MOP 74.4 million[18][46] - The Group's currency risk primarily stems from HKD, with no current foreign currency hedging policy, though management continuously monitors it[20] Employees and Remuneration Policy As of the reporting period end, the Group's employee count significantly decreased to 34 from 67 in the prior year; however, total staff costs increased from MOP 3.5 million to MOP 8.2 million, which the report attributes to an increase in employees, indicating a potential discrepancy or referring specifically to administrative staff costs | Metric | June 30, 2024 | June 30, 2023 | | :--- | :--- | :--- | | Total Employees | 34 | 67 | | Total Staff Costs (MOP Million) | 8.2 | 3.5 | Events After Reporting Period Significant negative events occurred post-reporting period: Chairman Mr. Li Kam Hung and Executive Director Mr. Yu Ming Ho were arrested by the ICAC on August 19, 2024, for alleged offenses under the Prevention of Bribery Ordinance and Securities and Futures Ordinance, with their duties suspended, though the Board believes this has not materially adversely affected the Group's daily operations - 【Significant Risk】Executive Director and Chairman Mr. Li Kam Hung and Executive Director Mr. Yu Ming Ho were arrested by the ICAC on August 19, 2024, for alleged bribery and securities ordinance violations, and their duties have been suspended[27] Interim Dividend Considering the Group's operating results and financial position, the Board does not recommend paying any interim dividend for the six months ended June 30, 2024 - The Board does not recommend declaring an interim dividend for 2024[28] Other Information Directors' and Chief Executives' Interests This section discloses the shareholding interests of directors and chief executives, noting that Chairman Mr. Li Kam Hung holds approximately 42.42% of the company's shares through his wholly-owned company, Qiao Yu Limited | Director Name | Capacity | Number of Shares Held | Percentage | | :--- | :--- | :--- | :--- | | Mr. Li Kam Hung | Interest in Controlled Corporation | 214,093,000 Shares | 42.42% | Share Option Scheme The company adopted a share option scheme in 2019, valid until 2029; as of the reporting period end, no share options have ever been granted or remain outstanding under this scheme - Since the adoption of the share option scheme, the company has never granted any share options[35] Corporate Governance The company claims compliance with the Corporate Governance Code, but deviates by having the roles of Chairman and Chief Executive Officer held by the same individual, Mr. Li Kam Hung; the Board believes this arrangement ensures consistent leadership and efficiency, with independent non-executive directors safeguarding shareholder interests - The company has a corporate governance deviation where the roles of Chairman and Chief Executive Officer are held by the same person, Mr. Li Kam Hung, not complying with Code Provision C.2.1[38] Condensed Consolidated Financial Statements Consolidated Statement of Profit or Loss The Consolidated Statement of Profit or Loss indicates a significant revenue contraction during the period, with a pre-tax loss of MOP 58.6 million and a total loss for the period of MOP 58.6 million, resulting in a basic loss per share of MOP 0.116, driven by substantial asset impairment losses and increased administrative expenses Consolidated Statement of Profit or Loss Summary (Six Months Ended June 30) | Metric (MOP Thousand) | 2024 (Unaudited) | 2023 (Unaudited) | | :--- | :--- | :--- | | Revenue | 6,126 | 58,445 | | Gross Profit | 178 | 2,036 | | Impairment Loss on Financial Assets | (42,801) | 384 (Reversal) | | Loss Before Tax | (58,582) | (7,053) | | Loss for the Period | (58,582) | (8,023) | | Basic Loss Per Share (MOP Cents) | (11.6) | (1.6) | Consolidated Statement of Financial Position The Statement of Financial Position reveals the company's severe insolvency as of the reporting period end, with net current liabilities expanding to MOP 75.7 million and total net liabilities (total deficit) reaching MOP 74.4 million, indicating an extremely fragile financial position Consolidated Statement of Financial Position Summary | Metric (MOP Thousand) | June 30, 2024 (Unaudited) | December 31, 2023 (Audited) | | :--- | :--- | :--- | | Total Assets | 114,306 | 168,581 | | Total Liabilities | 188,751 | 184,464 | | Net Current Liabilities | (75,713) | (17,408) | | Net Liabilities / Total Deficit | (74,445) | (15,883) | Consolidated Statement of Cash Flows During the reporting period, operating activities resulted in a net cash outflow of MOP 3.2 million, contrasting with a net inflow in the prior year, while financing activities recorded a small net cash inflow, leading to a decrease in period-end cash and cash equivalents to MOP 2.1 million Consolidated Statement of Cash Flows Summary (Six Months Ended June 30) | Metric (MOP Thousand) | 2024 (Unaudited) | 2023 (Unaudited) | | :--- | :--- | :--- | | Net Cash from Operating Activities | (3,231) | 999 | | Net Cash from Investing Activities | 1 | 350 | | Net Cash from Financing Activities | 760 | (3,515) | | Net Decrease in Cash and Cash Equivalents | (2,470) | (2,166) | | Cash and Cash Equivalents at End of Period | 2,061 | 2,590 | Summary of Notes to Financial Statements Notes to the financial statements reveal critical risk information, including a significant increase in impairment provisions for trade receivables, approximately MOP 50.5 million in defaulted bank borrowings and overdrafts with ongoing negotiations, and a substantial surge in amounts due to a director (Chairman Mr. Li) to MOP 22.7 million - Impairment provision for trade receivables significantly increased from MOP 32.2 million to MOP 72.6 million[69] - Amounts due to Executive Director Mr. Li Kam Hung, which are unsecured, interest-free, and repayable on demand, surged from MOP 2.97 million to MOP 22.7 million[72] - 【Significant Risk】As of the reporting period end, the Group had approximately MOP 50.53 million in defaulted bank borrowings and overdrafts, which, if lenders exercise their rights, would become immediately repayable[75]