Company Overview - The company qualifies as an "emerging growth company" with less than US$1.235 billion in revenue for the last fiscal year, allowing for reduced reporting requirements [250]. - The company has over 10 years of experience in the personal care electrical appliance industry, focusing on sourcing and wholesaling for international brand owners [257]. - The management team has over 30 years of research, development, and operational experience, driving business growth through R&D efforts [308]. - The company has a strong presence in the personal care electrical appliances industry with a 10-year operating history, focusing on hair styling products [307]. Revenue Breakdown - Revenue from hair styling series constituted 48% of total revenue for the year ended March 31, 2024, with hair dryers accounting for approximately 37% of that segment [259]. - Sales of trimmer series represented 34% of total revenue for the year ended March 31, 2024, with new products like men's shaver and women's epilator contributing 11% and 13% respectively [264]. - The company generated 74.1% of total revenue from Koizumi Seiki Corp. for the year ended March 31, 2024, while expanding into markets in the U.S., U.K., Germany, Australia, and New Zealand [272]. - For the year ended March 31, 2024, two major customers accounted for 74.1% and 16.5% of the total revenues respectively [500]. Market Trends - The global personal care electrical appliances market size expanded to US$22.75 billion in 2024 from US$21.27 billion in 2023, representing a compound annual growth rate (CAGR) of 7% [286]. - The overall total sales value of personal care electrical appliances in Japan increased by 10.8% in 2023, from Japanese Yen 277.6 billion in 2022 to Japanese Yen 307.6 billion in 2023 [290]. - The total sales value of personal care electrical appliances in the U.S. increased by 10.8% in 2023, from US$6.57 billion in 2022 to US$6.81 billion in 2023 [296]. - The global personal care electrical appliances market is projected to reach US$35.9 billion by 2032, with a CAGR of 5% during 2024-2032 [300]. - The personal care appliances market size is expected to grow to US$29.68 billion by 2028, with a CAGR of 6.9% [301]. Distribution and Sales Channels - The e-commerce channel segment is expected to record the highest CAGR of 7.4% among various distribution channels during 2022 through 2031 [302]. - The rise in disposable incomes and expansion of the organized retail sector are key market drivers [305]. Product Development and Future Plans - The company plans to explore oral care electrical appliance series for international brand owners, leveraging its design and development capabilities [268]. - The company plans to explore new product lines, including oral care electrical appliances, and expand men's personal care and hair care product lines [314]. - The company aims to expand its market presence from Hong Kong to the U.S., Europe, and other Asian markets, although marketing initiatives have not yet started in these regions [315]. Financial Information - Payments to Zhongshan Raytech accounted for 88.5% of total manufacturing costs for the year ended March 31, 2024 [277]. - As of March 31, 2024, the cash balance was HKD 35,885,666 (approximately US$ 4,585,500) held at reputable financial institutions in Hong Kong [494]. - For the year ended March 31, 2022, net cash used in financing activities was HKD 1,558,000 due to dividend payments [495]. - The company did not incur any capital expenditures for the years ended March 31, 2022, 2023, and 2024 [496]. Customer and Supplier Relationships - As of March 31, 2022 and 2023, one major customer accounted for 96.8% and 99.6% of the total accounts receivable respectively [499]. - As of March 31, 2024, one manufacturer accounted for 97.1% of the total balance of accounts payable [501]. - For the year ended March 31, 2024, one manufacturer accounted for 88.5% of total purchases [502]. - The company has implemented a stringent quality control system to ensure high-quality products that meet international safety standards [311]. Risk Factors - The company is exposed to foreign currency risk primarily through sales denominated in currencies other than the functional currency, mainly US$ [504]. - The company is not exposed to significant interest rate risk as the interest rates are not expected to change significantly [503]. - The increasing amount of plastic waste due to disposal of electrical appliances acts as a restraint in the development of these products [306]. Employee and Operational Information - As of March 31, 2024, the company has 6 employees and maintains good relations with them [324]. - The principal executive office is a leased property of 1,343 square feet with a monthly rent of HKD25,000 (approximately US$3,194) [326]. - The operating lease expenses amounted to HKD300,000 (approximately US$38,334) for the years ended March 31, 2024, and 2023 [326]. - The research and development team consists of 2 full-time employees with a combined experience of at least 16 years in electrical appliances engineering and supply chain management [268]. Intellectual Property - The company does not own any trademarks or patents for its products, as these are owned by its customers [321].
Raytech Holding Limited(RAY) - 2024 Q4 - Annual Report