联亚集团(00458) - 2025 - 中期业绩

2025 Interim Results Financial Summary Condensed Consolidated Interim Income Statement The company reported HKD 1.676 billion in revenue, a 13% decrease, with profit attributable to equity holders significantly down to HKD 1.675 million and basic EPS at HKD 0.006 Key Data from Condensed Consolidated Interim Income Statement | Metric | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Revenue | 1,676,431 | 1,926,401 | -13.0% | | Gross Profit | 686,900 | 794,933 | -13.6% | | Operating Profit | 47,394 | 125,387 | -62.2% | | Profit for the Period | 3,546 | 63,903 | -94.5% | | Profit Attributable to Equity Holders of the Company | 1,675 | 62,532 | -97.3% | | Basic Earnings Per Share | HKD 0.006 | HKD 0.23 | -97.4% | Condensed Consolidated Interim Statement of Comprehensive Income Total comprehensive income for the period significantly increased to HKD 98.9 million, primarily driven by favorable exchange differences from overseas subsidiaries Key Data from Condensed Consolidated Interim Statement of Comprehensive Income | Metric | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Profit for the Period | 3,546 | 63,903 | -94.5% | | Exchange differences arising from translation of financial statements of overseas subsidiaries | 94,405 | (36,347) | Turned from loss to profit | | Total Comprehensive Income for the Period | 98,900 | 25,978 | +280.7% | | Total Comprehensive Income Attributable to Equity Holders of the Company | 97,029 | 24,607 | +294.3% | Condensed Consolidated Interim Statement of Financial Position Total assets less current liabilities reached HKD 2.061 billion, with net assets at HKD 1.307 billion, showing growth, while cash and bank balances decreased Key Data from Condensed Consolidated Interim Statement of Financial Position | Metric | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change | | :--- | :--- | :--- | :--- | | Total Assets Less Current Liabilities | 2,061,022 | 1,999,278 | +3.1% | | Net Assets | 1,306,873 | 1,255,923 | +4.1% | | Net Current Assets | 808,769 | 807,774 | +0.1% | | Cash and Bank Balances | 348,043 | 466,554 | -25.4% | Notes to the Financial Statements 1. Compliance Statement and Basis of Preparation Interim financial statements are prepared under HKEX Listing Rules and HKAS 34, using consistent accounting policies with the 2024 annual financial statements - Financial statements are prepared in compliance with the Listing Rules and Hong Kong Accounting Standard 34[7] - Accounting policies are consistent with the 2024 annual financial statements, except for changes detailed in Note 2[7] 2. Changes in Accounting Policies The Group applied HKAS 21 amendments on foreign currency exchange rates, which had no significant impact, and no other new standards were applied - Amendments to Hong Kong Accounting Standard 21 were applied, but with no significant impact on the Group[8] - No new standards or interpretations not yet effective were applied in this accounting period[9] 3. Estimates Management's judgments, estimates, and assumptions in financial statement preparation may lead to actual results differing from reported amounts - Management is required to make judgments, estimates, and assumptions when preparing financial statements[10] - Actual results may differ from these estimates[10] 4. Segment Information The Group operates in garment manufacturing and brand business segments, with performance assessed by profit or loss before tax, and revenue from key international markets - The Group has two reportable segments: garment manufacturing and brand business[11] - Key operating decision-makers assess segment performance based on profit or loss before tax[11] Business Segment Performance Garment manufacturing saw decreased revenue, EBITDA, and profit before tax, while brand business revenue and EBITDA also fell, but its loss before tax narrowed Segment Results Overview | Metric | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Garment Manufacturing Segment | | | | | Revenue | 796,690 | 973,595 | -18.2% | | EBITDA | 84,276 | 137,528 | -38.7% | | Profit Before Tax | 66,333 | 122,085 | -45.6% | | Brand Business Segment | | | | | Revenue | 879,741 | 952,806 | -7.6% | | EBITDA | 78,135 | 79,486 | -1.7% | | Profit/(Loss) Before Tax | (40,003) | (61,448) | Loss narrowed | | Total | | | | | Revenue | 1,676,431 | 1,926,401 | -13.0% | | EBITDA | 164,174 | 260,270 | -36.9% | | Profit Before Tax | 23,687 | 97,141 | -75.6% | Other Segment Activities | Metric | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Impairment provision for receivables (net) | (1,869) | (3,226) | Loss reduced | | Reversal of write-down/(write-down) of inventories to net realisable value (net) | 13,686 | (27,564) | Turned from loss to profit | | Additions to property, plant and equipment (including right-of-use assets) | 72,352 | 99,561 | -27.3% | Geographical Segment Revenue and Assets Revenue is concentrated in China, UK, Canada, Italy, and Singapore, with China's share slightly down; non-current assets are mainly in China, Switzerland, and Thailand Revenue Analysis by Customer Location | Region | 2025 Revenue (Thousand HKD) | 2024 Revenue (Thousand HKD) | 2025 Share | 2024 Share | | :--- | :--- | :--- | :--- | :--- | | China | 483,648 | 580,312 | 28.8% | 30.1% | | United Kingdom | 340,460 | 430,296 | 20.3% | 22.3% | | Canada | 248,396 | 286,443 | 14.8% | 14.9% | | Italy | 183,000 | 204,151 | 10.9% | 10.6% | | Singapore | 73,276 | 72,064 | 4.4% | 3.7% | | Other Countries | 347,651 | 353,135 | 20.7% | 18.3% | | Total | 1,676,431 | 1,926,401 | 100% | 100% | - Non-current assets are primarily located in China (HKD 658,820 thousand), Switzerland (HKD 244,816 thousand), and Thailand (HKD 71,914 thousand)[17] - Revenue from two customers in the garment manufacturing segment accounted for approximately 13% and 13% of the Group's total revenue (2024: 15% and 13%)[16] 5. Net Other Income Net other income significantly decreased to HKD 0.766 million, mainly due to the absence of a prior-year one-off asset sale gain and current-period impairment losses Composition of Net Other Income | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | | :--- | :--- | :--- | | Government grants | 3,078 | 323 | | Impairment loss on property, plant and equipment | (4,999) | – | | Net (loss)/gain on disposal of property, plant and equipment | (1,205) | 19,465 | | Net gain on derecognition of right-of-use assets and lease liabilities | 1,666 | 855 | | Miscellaneous income | 2,226 | 2,334 | | Total | 766 | 22,977 | - The first half of 2024 included a gain of HKD 20,923 thousand from the disposal of certain unused leasehold land use rights and ancillary buildings in Mainland China[19] - The first half of 2025 recorded an impairment loss of HKD 4,999 thousand on property, plant and equipment for certain underperforming cash-generating units within the brand business[19] 6. Operating Profit Operating profit significantly decreased to HKD 47.394 million, driven by lower revenue, reduced net other income, and impairment losses, despite a slight rise in employee costs Items Deducted From/Included In Operating Profit | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | | :--- | :--- | :--- | | Amortisation of intangible assets | 26,057 | 28,620 | | Depreciation expense – owned property, plant and equipment | 30,832 | 43,206 | | Depreciation expense – right-of-use assets | 54,892 | 63,057 | | Employee costs and staff welfare expenses | 378,438 | 373,354 | - Operating profit significantly decreased, primarily due to reduced revenue and a substantial decline in net other income[3][34] 7. Finance Income and Costs Finance income increased to HKD 3.969 million from bank deposits, while finance costs decreased to HKD 27.676 million due to lower interest expenses Finance Income and Costs | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | | :--- | :--- | :--- | | Finance Income | | | | Interest income from bank deposits | 3,545 | 1,783 | | Imputed interest on long-term rental deposits | 424 | 354 | | Total Finance Income | 3,969 | 2,137 | | Finance Costs | | | | Interest on bank loans | 389 | 851 | | Interest on franchise fees payable | 22,602 | 24,361 | | Interest on lease liabilities | 4,685 | 5,171 | | Total Finance Costs | 27,676 | 30,383 | 8. Income Tax Expense Income tax expense was HKD 20.141 million, a decrease from HKD 33.238 million in the prior period, primarily due to lower profit from the garment manufacturing business Composition of Income Tax Expense | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | | :--- | :--- | :--- | | Hong Kong profits tax | 5,564 | 16,204 | | Non-Hong Kong taxes | 9,942 | 15,147 | | Under/(over) provision in prior years | 2,913 | (100) | | Deferred income tax | 1,722 | 1,987 | | Total Income Tax Expense | 20,141 | 33,238 | - The decrease in income tax expense was primarily due to lower profit from the garment manufacturing business in the first half[47] 9. Earnings Per Share Basic earnings per share significantly decreased to HKD 0.006, down from HKD 0.23, mainly due to a substantial reduction in profit attributable to equity holders Earnings Per Share Data | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit Attributable to Equity Holders of the Company | 1,675 Thousand HKD | 62,532 Thousand HKD | | Weighted Average Number of Ordinary Shares in Issue During the Period | 272,775,684 shares | 271,776,561 shares | | Basic Earnings Per Share | HKD 0.006 | HKD 0.23 | | Diluted Earnings Per Share | HKD 0.006 | HKD 0.23 | 10. Dividends The Board resolved not to declare an interim dividend for H1 2025 (2024: HKD 0.06 per share), while the 2024 final dividend was paid - No interim dividend declared for the first half of 2025 (2024: HKD 0.06 per share)[25][61] - The 2024 annual final dividend of HKD 0.17 per share was paid on July 17, 2025[25] 11. Inventories Total inventories increased to HKD 855 million, reflecting seasonal demand for the garment manufacturing segment's second-half shipments Composition of Inventories | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Raw materials | 141,922 | 74,862 | | Work in progress | 213,994 | 159,291 | | Finished goods | 475,307 | 517,785 | | Goods in transit | 23,715 | 29,264 | | Total | 854,938 | 781,202 | - The increase in raw materials and work in progress reflects seasonal demand for the garment manufacturing segment's second-half shipments[26] 12. Trade and Bills Receivables Trade and bills receivables increased to HKD 541 million, with most customers having good credit and terms of 45-90 days; some receivables are sold for cash flow Trade and Bills Receivables | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Trade receivables measured at amortised cost (net of loss allowance) | 375,893 | 330,538 | | Trade receivables to be sold measured at fair value through other comprehensive income (revolving) | 165,007 | 122,507 | | Total | 540,900 | 453,045 | - Most customers for trade receivables have appropriate credit records, with credit terms mainly ranging from 45 to 90 days[28] - The Group may sell certain trade receivables to financial institutions before their due date under customers' supplier financing programs[29] 13. Trade and Bills Payables Trade and bills payables decreased to HKD 301 million, with most supplier payment terms within 60 days Ageing Analysis of Trade and Bills Payables | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Less than 3 months | 267,182 | 289,622 | | 3 to 6 months | 8,970 | 19,757 | | Over 6 months | 24,476 | 19,633 | | Total | 300,628 | 329,012 | - Supplier payment terms are mostly within 60 days[30] 14. Capital Commitments Contracted capital commitments for property, plant and equipment totaled HKD 38.67 million, mainly for a new logistics facility in Hefei Industrial Park Capital Commitments | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Contracted but not provided for property, plant and equipment | 38,670 | – | - Capital commitments primarily include the construction of a new three-story logistics facility in Hefei Industrial Park, with a contract sum of RMB 45,139,583.50[32] Management Discussion and Analysis Overview Profit attributable to equity holders significantly decreased to HKD 2 million, impacted by challenging market conditions, reduced garment business profit, and no prior-year one-off asset sale gain - Profit attributable to equity holders: HKD 2 million (2024: HKD 63 million)[34] - The profit decline was mainly due to challenging and competitive market conditions, coupled with ongoing global trade uncertainties, leading to reduced demand from certain customers and a decrease in both revenue and profit for the garment manufacturing business[34] - No one-off gain of HKD 21 million was recognised in the first half of 2025 from the disposal of certain leasehold land use rights and ancillary buildings in Mainland China, as was the case in the first half of 2024[34] Business Review C.P. Company maintained profitability, while licensed brands Nautica, Spyder, and Reebok faced declining revenue and worsening losses; garment manufacturing also saw reduced revenue and profit Own Brands C.P. Company revenue grew with increased profit, Cissonne shifts to online, while licensed brands Nautica and Spyder saw increased losses, and Reebok's loss narrowed C.P. Company C.P. Company revenue grew 1% at constant exchange rates, driven by retail expansion, with brand profit increasing despite higher store expenses - C.P. Company's revenue increased by 1% at constant exchange rates[35] - Retail channel revenue recorded high double-digit growth, primarily driven by the opening of new full-price and outlet stores[35] - The brand recorded profit growth, though partially offset by increased store expenses[35] Cissonne Cissonne, with five stores, will shift to an online-focused, pull-based operating model in H2 to reduce inventory and increase sales flexibility - Cissonne operates five stores[36] - The brand's sales model will change in the second half, using its own brand as the business foundation and online platforms as sales points, piloting a pull-based operating model[36] Licensed Brands (Nautica, Spyder, Reebok) Nautica and Spyder saw revenue declines and increased losses, while Reebok's revenue fell but operating losses decreased due to cost control - Nautica's revenue in the first half of 2025 decreased by 8% year-on-year, with losses increasing compared to the prior period[37] - Spyder's revenue in the first half of 2025 also decreased by 26% compared to the first half of 2024, with losses increasing year-on-year[37] - Reebok's revenue decreased by 21% compared to the first half of 2024, but operating losses decreased year-on-year[38] - The Group has conducted a strategic review of its licensed brand portfolio to optimize resource allocation and support long-term growth[38] Garment Manufacturing Business Garment manufacturing revenue and profit declined due to market challenges and reduced demand, though Vietnamese factory orders increased, with ongoing efforts to enhance efficiency - Revenue and profit for the garment manufacturing business both decreased, primarily due to challenging and competitive market conditions, coupled with ongoing global trade uncertainties, leading to reduced demand from certain customers[39] - Orders for Vietnamese factories still increased during the period[39] - The Group continues to enhance production efficiency and competitiveness through implementing automation and streamlined operational measures[39] Financial Performance Analysis Total revenue decreased by 13%, gross profit declined with stable margin, net other income significantly reduced, and expenses decreased, leading to lower garment profit but narrowed brand loss Revenue Total revenue decreased by 13% to HKD 1.676 billion, with both brand and garment segments declining, and a seasonal skew towards the second half - The Group's total revenue for the first half of 2025 was HKD 1.676 billion (2024: HKD 1.926 billion), a 13% decrease compared to the first half of 2024[41] - Revenue from the brand business decreased by 8%, and revenue from the garment manufacturing business decreased by 18.2%[41] - The Group's business is skewed towards the second half, primarily due to seasonal impacts from higher garment manufacturing and brand business product shipments during the autumn/winter and holiday seasons[42] Gross Profit Total gross profit was HKD 687 million, with a gross margin of 41.0%, slightly down from 41.3%, primarily due to reduced revenue and mixed segment gross margin changes - The Group recorded an overall gross profit of HKD 687 million (2024: HKD 795 million), with a gross margin of 41.0% (2024: 41.3%)[43] - The decrease in gross profit was primarily due to reduced revenue[43] - Changes in customer revenue mix led to a slight decrease in the gross margin of the garment manufacturing business year-on-year, while the overall gross margin of the brand business slightly increased[43] Net Other Income Net other income significantly decreased due to the absence of a prior-year one-off gain of HKD 21 million from asset disposals - In the first half of 2024, net other income included a gain of HKD 21 million from the disposal of certain unused leasehold land use rights and ancillary buildings in Mainland China[44] - No such one-off items were recorded in the current reporting period[44] Selling and Distribution Expenses Selling and distribution expenses decreased due to lower commissions and store expenses for licensed brands, and reduced marketing and e-commerce costs for C.P. Company - Selling and distribution expenses decreased compared to the first half of 2024, primarily due to reduced retail partner commissions and store expenses for licensed brands[45] - C.P. Company's advertising and promotion expenses, as well as e-commerce and agency commissions, decreased[45] General and Administrative Expenses General and administrative expenses increased year-on-year, despite cost control efforts, mainly due to higher exchange gains recorded in the prior period - General and administrative expenses reported in the current period increased compared to the first half of 2024, primarily due to higher exchange gains recorded in the first half of 2024[46] - The Group has controlled and reduced its general and administrative expenses[46] Income Tax Expense Income tax expense decreased year-on-year, mainly due to reduced profit from the garment manufacturing business in the first half - Income tax expense decreased compared to the prior period, primarily due to lower profit from the garment manufacturing business in the first half[47] Segment Results Garment manufacturing profit declined due to lower revenue; brand business overall loss narrowed, with C.P. Company profit up, but Nautica and Spyder losses increased - The garment manufacturing business recorded a profit decrease due to reduced revenue[48] - The overall loss of the brand business narrowed compared to the prior period[48] - C.P. Company recorded an increase in profit; among licensed brands, Nautica and Spyder's operating losses increased, while Reebok's decreased[48] Financial Resources and Liquidity Cash and bank balances were HKD 348 million, with short-term bank loans at HKD 77 million; shareholder equity increased due to Euro appreciation - As of June 30, 2025, cash and bank balances were HKD 348 million (December 31, 2024: HKD 467 million)[49] - As of June 30, 2025, the Group's short-term bank loans amounted to HKD 77 million (December 31, 2024: nil)[49] - Shareholders' equity increased compared to December 31, 2024, primarily due to exchange gains from the translation of overseas subsidiaries' financial statements (mainly from the significant appreciation of the Euro against the HKD since April of the current year)[51] Contingent Liabilities and Capital Commitments The main capital commitment is a RMB 45.14 million contract for a new logistics facility in Hefei, serving as the China brand business distribution center - Major capital commitments include a construction contract with Hefei Luen Thai for a new three-story logistics facility on land owned by Hefei Luen Thai within the Hefei Economic and Technological Development Zone Industrial Park[52] - The contract sum is RMB 45,139,583.50[52] - Upon completion, this logistics facility will create synergies with existing facilities in Hefei Industrial Park and serve as the distribution center for the Group's China brand business[52] Human Resources The Group had approximately 6,220 employees, a decrease from 6,530, with competitive remuneration and benefits, including discretionary bonuses and share options for top performers - As of June 30, 2025, the Group had approximately 6,220 employees (December 31, 2024: 6,530 employees)[54] - Employees are provided with reasonable and competitive remuneration and benefits, with outstanding performers also receiving discretionary bonuses and share options[54] Outlook The market remains challenging; C.P. Company expects stable performance with D2C and new markets offsetting European wholesale decline; licensed brands will boost online investment; garment manufacturing will focus on efficiency; the Group will control costs and innovate for sustainable growth - C.P. Company anticipates a further decline in wholesale revenue from existing mature markets, but growth in Eastern Europe and Spain, along with new market opportunities in South America, Southeast Asia, and the Middle East, are expected to partially offset this decline[55] - The licensed brand business will increase investment in online channels to drive growth, enhance resource allocation for digital operations, and adopt data-driven marketing strategies[56] - The garment manufacturing business will continue to streamline operations and improve efficiency, leveraging its multi-region production bases, unique production systems, and flexible supply chain to collaborate closely with customers and navigate headwinds[56] - The Group will strictly control operating costs, continuing to focus on enhancing operational efficiency, brand innovation, and product optimization to strengthen its competitiveness and drive long-term value creation and sustainable growth[57] Other Information Compliance with Corporate Governance Code The Company complied with the Corporate Governance Code, except for the Chairman and CEO roles being combined, which the Board deems in the Group's best interest - The Company has consistently applied the principles and complied with all code provisions of Appendix C1, "Corporate Governance Code," of the Listing Rules, except for a deviation from code provision C.2.1[58] - Mr. Wang Jianzhong serves as both the Chairman and Chief Executive Officer, which constitutes a deviation from the aforementioned code provision C.2.1[58] - The Board believes that Mr. Wang Jianzhong holding both the Chairman and Chief Executive Officer roles is in the best interest of the Group[58] Purchase, Sale or Redemption of Listed Securities Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025 - During the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[60] Interim Dividend The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 (2024: HKD 0.06 per share) - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 (2024: HKD 0.06 per share)[61] Review of Financial Statements by Audit Committee The Company's condensed consolidated interim financial statements and interim report for H1 2025 were reviewed by the Audit Committee and management - The Company's condensed consolidated interim financial statements and interim report for the six months ended June 30, 2025, have been reviewed by the Company's Audit Committee in conjunction with the Group's management[62]