Financial Performance - Revenue for the six months ended June 30, 2024, was HK$789,940,000, a decrease of 3.6% compared to HK$819,910,000 in the same period of 2023[5]. - Gross profit for the period was HK$144,026,000, down 11.1% from HK$162,045,000 in 2023[5]. - Operating loss increased to HK$180,341,000, compared to an operating loss of HK$88,384,000 in the previous year, reflecting a significant decline in profitability[5]. - Loss for the period was HK$142,480,000, compared to a loss of HK$92,471,000 in the same period last year, indicating a worsening financial performance[5]. - Total comprehensive loss for the period was HK$167,357,000, compared to HK$123,330,000 in 2023, highlighting increased financial challenges[7]. - Other income decreased to HK$9,289,000 from HK$12,456,000, representing a decline of 25.5% year-over-year[5]. - Selling, marketing, and distribution costs rose to HK$159,692,000, up from HK$115,529,000, indicating increased expenditure in these areas[5]. - The company reported a finance cost of HK$10,087,000, compared to HK$4,181,000 in the previous year, reflecting higher borrowing costs[5]. - The income tax credit for the period was HK$47,064,000, compared to an expense of HK$2,684,000 in 2023, indicating a favorable tax position[5]. - The loss attributable to equity holders of the Company for the six months ended June 30, 2024, was HK$141,189,000, compared to HK$91,723,000 for the same period in 2023, representing a 54% increase in loss[11]. - Total comprehensive loss attributable to equity holders of the Company for the same period was HK$165,569,000, up from HK$121,703,000 in 2023, indicating a 36% increase[11]. - Basic and diluted loss per share for equity holders was HK$6.72, compared to HK$4.37 in the previous year, reflecting a 53% increase in loss per share[11]. Assets and Liabilities - Total assets as of June 30, 2024, were HK$3,341,328,000, a decrease from HK$3,407,150,000 as of December 31, 2023[13]. - Current assets decreased to HK$1,366,099,000 from HK$1,458,063,000, marking a decline of approximately 6.3%[13]. - Total equity as of June 30, 2024, was HK$1,836,873,000, down from HK$2,004,230,000 at the end of 2023, representing a decrease of about 8.3%[16]. - Non-current liabilities increased to HK$357,538,000 from HK$274,885,000, indicating a rise of approximately 30%[16]. - The total liabilities as of June 30, 2024, were HK$1,504,455,000, compared to HK$1,402,920,000 at the end of 2023, reflecting an increase of about 7.2%[16]. - Trade and bill receivables decreased from HK$429,647,000 as of December 31, 2023, to HK$371,476,000 as of June 30, 2024, representing a decline of approximately 13.5%[99]. - The net trade and bill receivables after loss allowance stood at HK$225,994,000, down from HK$241,837,000, indicating a decrease of about 6.6%[99]. - Current bank borrowings increased significantly from HK$232,147,000 to HK$298,810,000, marking an increase of about 28.6%[106]. - Total bank borrowings rose from HK$383,257,000 to HK$550,364,000, an increase of approximately 43.6%[106]. Cash Flow and Financing - Net cash used in operating activities was HK$40,442,000, while net cash used in investing activities was HK$94,330,000 for the six months ended June 30, 2024[23]. - The company generated net cash from financing activities amounting to HK$155,601,000 during the same period[23]. - Cash and cash equivalents at June 30, 2024, totaled HK$321,921,000, a decrease from HK$396,554,000 in the previous year[23]. - The Group's bank borrowings as of June 30, 2024, totaled HK$623.85 million, with lease liabilities amounting to HK$61.39 million, resulting in total liabilities of HK$685.24 million[46]. - The Group's liquidity risk management indicates that all contractual obligations are manageable within the short term, reflecting a stable financial position[45][47]. Segment Performance - Total revenue for the six months ended June 30, 2024, was HK$829,155,000, with contributions from OEM at HK$511,901,000, Retail at HK$288,766,000, and Property investment at HK$28,488,000[69]. - The Group has three reportable segments: OEM, Retail, and Property investment, with performance assessed based on profit before income tax[66]. - Segment loss before income tax for the six months ended June 30, 2023, was HK$ (86,550,000), compared to HK$ (184,931,000) for the same period in 2024[79]. - Total segment revenue for the OEM segment was HK$ 560,302,000, while the retail segment generated HK$ 291,315,000[74]. Economic and Market Conditions - The global economic growth was reported to be generally lower than pre-pandemic levels, impacting international trade significantly[145]. - The overall economic environment continues to exert significant pressure on the development of international trade, influenced by geopolitical risks and high inflation[145]. - The domestic retail market in the PRC is expected to grow in 2024, providing opportunities for customer exploration and new product development[160]. Corporate Governance and Compliance - The company has not audited the condensed consolidated interim financial information for the six months ended June 30, 2024[28]. - The financial information is prepared in accordance with Hong Kong Accounting Standard ("HKAS") 34, indicating compliance with interim financial reporting standards[28]. - The company has complied with the applicable code provisions of the Corporate Governance Code during 1H2024[197]. - All directors confirmed compliance with the required standard of dealings as set forth in the Model Code during 1H2024[199]. Employee and Operational Insights - The Group employed a total of 4,069 employees across various regions including Mainland China, Hong Kong, Cambodia, and the United States[161]. - The Group has established an incentive bonus scheme for employees, with benefits based on performance, reviewed annually[161]. - Employee benefit expenses increased slightly to HK$172,309,000 in 2024 from HK$171,710,000 in 2023, reflecting a marginal rise of 0.3%[112]. Future Outlook and Strategic Initiatives - The Group aims to enhance its capabilities in new product research and development, supply chain security, and customer service through improved centralized management[146]. - The Group plans to explore new opportunities across all business segments in response to increasing production costs and decreasing profit margins[160]. - The Group is seeking a waiver from lenders regarding the low current ratio, which has not resulted in any demand for early repayment of loans[108].
华鼎控股(03398) - 2024 - 中期财报