权识国际(00381) - 2025 - 中期业绩

Condensed Consolidated Statement of Profit or Loss Profit or Loss Overview The Group's revenue grew significantly, but profit for the period declined sharply, resulting in a loss attributable to company owners Key Financial Performance | Indicator | 2025 (HK$ thousands) | 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 203,267 | 143,434 | +41.7% | | Cost of Sales | (139,776) | (74,380) | +87.9% | | Gross Profit | 63,491 | 69,054 | -8.0% | | Profit for the period | 6,733 | 30,277 | -77.8% | | (Loss)/profit attributable to owners of the Company | (6,013) | 17,613 | From Profit to Loss | | Non-controlling interests | 12,746 | 12,664 | +0.6% | | Basic (loss)/earnings per share (HK cents) | (0.76) | 18.54 | From Profit to Loss | - Revenue growth was primarily driven by contributions from new business segments, but the decline in gross profit and the loss attributable to company owners indicate challenges in profitability[4][5] Condensed Consolidated Statement of Comprehensive Income Comprehensive Income Overview Total comprehensive income decreased, as positive foreign exchange differences only partially offset the significant drop in profit for the period Comprehensive Income Summary | Indicator | 2025 (HK$ thousands) | 2024 (HK$ thousands) | Change | | :--- | :--- | :--- | :--- | | Profit for the period | 6,733 | 30,277 | -77.8% | | Exchange differences on translation of foreign operations | 9,658 | (10,920) | From Loss to Gain | | Total comprehensive income for the period | 16,391 | 19,357 | -15.3% | | Total comprehensive (loss)/income attributable to owners of the Company | (833) | 9,513 | From Income to Loss | | Non-controlling interests | 17,224 | 9,844 | +75.0% | - The positive impact of exchange differences did not fully compensate for the decline in profit, leading to a decrease in total comprehensive income and a shift to a loss for company owners[6] Condensed Consolidated Statement of Financial Position Financial Position Overview The Group's total assets grew slightly, but widening net current liabilities indicate increased liquidity pressure Key Financial Position Indicators | Indicator | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 467,990 | 463,631 | +0.9% | | Current assets | 375,885 | 332,980 | +12.9% | | Current liabilities | 430,688 | 359,408 | +19.8% | | Net current liabilities | (54,803) | (26,428) | Deficit Widened | | Total assets less current liabilities | 413,187 | 437,203 | -5.6% | | Non-current liabilities | 13,147 | 53,554 | -75.5% | | Net assets | 400,040 | 383,649 | +4.3% | | Total equity | 400,040 | 383,649 | +4.3% | - The expansion of net current liabilities suggests significant short-term debt repayment pressure, requiring attention despite a large reduction in non-current liabilities[7][8] Notes to the Condensed Consolidated Interim Financial Statements 1. General Information The Group operates diversified businesses including toys, herbal products, fruit plantation, leisure, and liquor trading - The Group's business is diversified, covering toys and gifts, Chinese herbal medicine, fruit plantation, leisure and cultural investment, and liquor trading[9] 2. Basis of Preparation and Changes in Accounting Policies and Disclosures The Group faces material going concern uncertainties due to net current liabilities, which management is actively addressing through financing measures - The Group faces material uncertainty regarding its going concern status, with net current liabilities of HK$54,803 thousand and secured borrowings and accrued interest of approximately HK$67,845 thousand and HK$30,650 thousand, respectively[12] - Management is actively negotiating settlement/extension with lenders and considering new fundraising activities such as rights issues, open offers, placements, and issuing convertible bonds to improve its financial position[13][15] - The initial application of the amendment to HKAS 21, "Lack of Exchangeability," had no material impact on the financial position or disclosures[14] 3. Estimates The key sources of estimation uncertainty in preparing these financial statements are consistent with those of the 2024 annual report - Management's significant judgments and estimates in financial statement preparation remain consistent with the previous year, though actual results may differ[16] 4. Segment Information The new liquor business became a major revenue contributor, while the toys and gifts segment returned to profitability - The Group's seven reportable segments include liquor, Chinese herbal medicine, culture, leisure, fruit plantation, toys and gifts, and exploration, with each business unit managed separately[17] Segment Results for H1 2025 (HK$ thousands) | Segment | 2025 Revenue | 2024 Revenue | Revenue Change (%) | 2025 Profit/(Loss) | 2024 Profit/(Loss) | Profit Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Toys and gifts | 82,324 | 86,484 | -4.9% | 1,313 | (670) | From Loss to Profit | | Chinese herbal medicine | 42,356 | 56,950 | -25.6% | 16,652 | 25,081 | -33.6% | | Liquor | 78,587 | – | New | 2,652 | – | New | | Fruit plantation | – | – | – | (2,853) | (3,435) | Loss Narrowed | | Leisure | – | – | – | 99 | (440) | From Loss to Profit | | Exploration | – | – | – | – | – | – | | Culture | – | – | – | – | – | – | | Total | 203,267 | 143,434 | +41.7% | 17,863 | 20,536 | -13.0% | Segment Assets as of 30 June 2025 (HK$ thousands) | Segment | 30 June 2025 | 31 December 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Toys and gifts | 213,171 | 213,413 | -0.1% | | Fruit plantation | 126,923 | 125,974 | +0.7% | | Leisure | 93,134 | 89,917 | +3.6% | | Chinese herbal medicine | 326,845 | 295,213 | +10.7% | | Liquor | 25,150 | 22,137 | +13.6% | | Exploration | 2 | 2 | 0% | | Culture | – | – | – | | Total | 785,225 | 746,656 | +5.2% | Segment Liabilities as of 30 June 2025 (HK$ thousands) | Segment | 30 June 2025 | 31 December 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Toys and gifts | (173,891) | (176,145) | -1.3% | | Fruit plantation | (1,005) | (1,005) | 0% | | Leisure | (17,112) | (16,540) | +3.5% | | Chinese herbal medicine | (11,754) | (5,892) | +99.5% | | Liquor | (22,679) | (22,807) | -0.6% | | Exploration | (91) | (88) | +3.4% | | Culture | – | – | – | | Total | (226,532) | (222,477) | +1.8% | 5. Income Tax Expense The Group's income tax expense increased during the period, primarily due to a rise in current tax charges - Hong Kong Profits Tax is levied at a two-tiered rate of 8.25% on the first HK$2 million of assessable profits and 16.5% on the remainder, while PRC subsidiaries are taxed at 25%[22] Income Tax Expense Breakdown | Indicator | 2025 (HK$ thousands) | 2024 (HK$ thousands) | | :--- | :--- | :--- | | Current tax - Overseas | 6,643 | 4,201 | | Deferred income tax | (40) | 203 | | Total income tax expense | 6,603 | 4,404 | 6. Profit for the Period Profit for the period was reached after accounting for various expenses, with notable decreases in amortization and depreciation but increases in staff costs Key Expense Items | Expense Item | 2025 (HK$ thousands) | 2024 (HK$ thousands) | Change | | :--- | :--- | :--- | :--- | | Amortisation of intangible assets | 195 | 1,362 | -85.7% | | Depreciation of property, plant and equipment | 374 | 2,994 | -87.5% | | Depreciation of right-of-use assets | 1,197 | 371 | +222.6% | | Staff costs (salaries, bonuses and allowances) | 22,896 | 21,914 | +4.5% | | Retirement benefit scheme contributions | 1,685 | 1,534 | +9.8% | | Legal and professional fees | 644 | 1,425 | -54.8% | | Interest expense on borrowings | 1,500 | 1,628 | -7.9% | 7. Dividends The Board of Directors has resolved not to declare any interim dividend for the period, consistent with the prior year - The Board decided not to declare an interim dividend for the first half of 2025, same as in H1 2024[25] 8. (Loss)/Earnings Per Share The company shifted from earnings per share to a loss per share, with basic and diluted calculations being identical due to anti-dilutive effects (Loss)/Earnings Per Share Calculation | Indicator | 2025 (HK$ thousands/thousand shares/HK cents) | 2024 (HK$ thousands/thousand shares/HK cents) | | :--- | :--- | :--- | | (Loss)/profit used for basic and diluted (loss)/earnings per share | (6,013) | 17,613 | | Weighted average number of ordinary shares in issue | 789,325 | 94,999 | | Basic (loss)/earnings per share (HK cents) | (0.76) | 18.54 | | Diluted (loss)/earnings per share (HK cents) | (0.76) | 18.54 | - Basic and diluted loss per share for H1 2025 were both 0.76 HK cents, primarily due to the loss attributable to the owners of the Company[26] - The calculation for basic and diluted loss per share yielded the same result for H1 2025 due to the anti-dilutive effect of convertible bonds[27] 9. Property, Plant and Equipment The Group's additions to property, plant, and equipment decreased significantly during the reporting period - Additions to property, plant and equipment for the period amounted to HK$12 thousand, a sharp decrease from the prior year[28] 10. Trade and Bills Receivables Trade and bills receivables increased, with a higher concentration of balances within the 30-day aging bracket Trade and Bills Receivables Breakdown | Indicator | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | | :--- | :--- | :--- | | Trade receivables — customers | 85,641 | 70,173 | | Less: Provision for credit losses | (19,227) | (18,846) | | Net trade receivables | 66,414 | 51,327 | | Bills receivable | – | 6,102 | | Total | 66,414 | 57,429 | Aging Analysis of Net Trade Receivables (HK$ thousands) | Aging | 30 June 2025 | 31 December 2024 | | :--- | :--- | :--- | | Within 30 days | 53,105 | 22,844 | | 31 to 90 days | 12,657 | 22,327 | | 91 to 180 days | 652 | 6,156 | | 181 to 360 days | – | – | | Over 360 days | – | – | | Total | 66,414 | 51,327 | - Net trade receivables increased, and the significant rise in balances aged within 30 days suggests recent sales growth[29][30] 11. Trade Payables Total trade payables decreased, with the majority of balances remaining due within 30 days Aging Analysis of Trade Payables (HK$ thousands) | Aging | 30 June 2025 | 31 December 2024 | | :--- | :--- | :--- | | Within 30 days | 15,840 | 19,692 | | 31 to 90 days | 3,243 | 2,901 | | 91 to 180 days | 53 | 1,138 | | 181 to 360 days | 14 | 1,841 | | Over 360 days | 2,348 | 1,790 | | Total | 21,498 | 27,362 | - Total trade payables decreased, with a high proportion due within 30 days, indicating timely payment management with suppliers[31] 12. Share Capital The company's share capital structure was significantly altered by share consolidation, conversions, and placements, with some shares classified as financial liabilities Share Capital Movement Overview (HK$ thousands/shares) | Item | 30 June 2025 (Shares) | 30 June 2025 (Amount) | 1 January 2024 (Shares) | 1 January 2024 (Amount) | | :--- | :--- | :--- | :--- | :--- | | Authorised share capital | 19,860,570,307 | 1,986,056 | 39,721,140,615 | 1,986,056 | | Issued and fully paid | 789,324,526 | 78,932 | 193,507,544 | 9,675 | | Share consolidation in 2024 | (96,753,772) | – | – | – | | Conversion of convertible bonds | 150,000,000 | 15,000 | – | – | | Placing of shares | 470,000,000 | 47,000 | – | – | | Capitalisation of borrowings in 2024 | 72,570,754 | 7,257 | – | – | | Obligation under share repurchase arrangement | 80,000 | 8 | 80,000 | 8 | - 80,000,000 ordinary shares were classified as a financial liability instead of equity due to repurchase terms, reflecting a potential liability risk[33] - Events in 2024, including share consolidation, conversion of convertible bonds, share placements, and capitalisation of borrowings, led to a significant increase in issued share capital[32][34] 13. Related Party Transactions Payments for marketing and other services to a related company increased during the period Related Party Transactions | Transaction Type | 2025 (HK$ thousands) | 2024 (HK$ thousands) | | :--- | :--- | :--- | | Fees for product development, sales, marketing, and other services paid to a related company | 3,531 | 2,958 | - The increase in related party transaction fees requires scrutiny regarding its reasonableness and impact on the Group's financial performance[35] 14. Capital Commitments The Group had no significant capital commitments at the end of the reporting period, consistent with the prior year - The Group had no significant capital commitments at the end of the reporting period[36] 15. Contingent Liabilities The Group had no significant contingent liabilities at the end of the reporting period, consistent with the prior year - The Group had no significant contingent liabilities at the end of the reporting period[38] 16. Litigation The company is involved in litigation concerning an outstanding loan and share repurchase, with negotiations currently underway for a resolution - The company is in a lawsuit with Mr Guo Jingsheng regarding an outstanding loan of approximately HK$13,921 thousand and related share repurchase terms[39][40] - The company is negotiating to repurchase the shares and settle the outstanding loan amount of approximately HK$9,538 thousand[41] 17. Events After the Reporting Period Subsequent to the reporting period, the company entered into a subscription agreement to issue new shares to settle convertible bond obligations - On July 4, 2025, the company signed a subscription agreement to issue 157,800,000 new shares for a total subscription amount of approximately HK$68,000 thousand[42] - The subscription proceeds will be settled by offsetting the principal of Hubei convertible bonds, and the shares were issued on July 22, 2025[42] Management Discussion and Analysis Financial Review The Group's revenue grew substantially, but a loss was recorded for equity holders due to investment losses and reduced segment profits Financial Highlights | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 203.3 | 143.4 | +41.7% | | (Loss)/profit attributable to equity holders of the Company | (6.0) | 17.6 | From Profit to Loss | | Basic (loss)/earnings per share (HK cents) | (0.76) | 18.54 | From Profit to Loss | - Despite significant revenue growth, the profit attributable to equity holders turned into a loss, mainly due to losses from investments in associates, absence of gains on derecognition of financial liabilities, and decreased profit from the Chinese herbal medicine segment[43] Business and Operational Review The Group's seven reportable segments showed varied performance, with the new liquor business providing a significant revenue boost - The Group has seven reportable segments: toys and gifts, natural resources exploration, fruit plantation, leisure, culture, Chinese herbal medicine, and liquor[44] Toys and Gifts Manufacturing and Sales The toys and gifts segment returned to profitability driven by a significant improvement in gross profit margin despite a slight revenue decline Toys and Gifts Performance | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | | :--- | :--- | :--- | | Revenue | 82.3 | 86.5 | | Gross Profit Margin | 57.8% | 42.2% | | Segment Profit/(Loss) | 1.31 | (0.67) | - The improvement in gross profit margin was mainly due to reduced material costs, which drove the segment's return to profitability[45] Chinese Herbal Medicine The Chinese herbal medicine business, focused on decoction services in mainland China, experienced a decline in revenue during the period Chinese Herbal Medicine Performance | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | | :--- | :--- | :--- | | Revenue | 42.4 | 57.0 | - The year-on-year revenue decline in the Chinese herbal medicine business suggests market competition or internal operational challenges[46] Liquor The newly acquired liquor business became a significant contributor to the Group's revenue and profit Liquor Business Performance | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | | :--- | :--- | :--- | | Revenue | 78.6 | – | | Segment Profit | 2.65 | – | - The liquor business, a new addition this period, contributed significant revenue and profit, becoming a new growth driver for the Group[47] Natural Resources Exploration The natural resources exploration segment holds substantial coal resources but remains non-cash-generating due to the lack of mining rights - The natural resources exploration business possesses extensive coal resources but is currently unable to generate cash flow due to the lack of mining rights, and the investment's carrying value has been fully written down[48] Fruit Plantation The commercial development project within the fruit plantation segment has been delayed due to global economic weakness - The commencement date for the commercial development project (hotel casino, residential villas) in the fruit plantation segment has been postponed to January 2026 due to global economic conditions[49][50] Leisure The leisure segment is adjusting its tea business model amid intense competition and is pursuing legal action to enforce a share transfer - The tea business is facing intense competition and is adjusting its business model to adapt to market changes[51] - The Group is optimistic about the liquor industry's prospects and has invested in yellow wine base liquor[52] - Legal enforcement procedures for the 20% equity transfer of Anhui Fulao have been initiated, and the court has issued a freezing order[53] Culture The culture business segment generated no revenue during the period, consistent with the prior year - The culture business reported zero revenue for the period[54] Selling and Distribution Costs Selling and distribution costs increased slightly, primarily driven by the launch of the new liquor business Selling and Distribution Costs | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | | :--- | :--- | :--- | | Selling and distribution costs | 15.0 | 14.8 | - The slight increase in selling and distribution costs is mainly attributable to the commencement of the new liquor business[55] Liquidity and Financial Resources The Group's gearing ratio increased as cash balances decreased and borrowings rose, indicating higher financial leverage Key Liquidity Indicators | Indicator | 30 June 2025 (HK$ million) | 31 December 2024 (HK$ million) | | :--- | :--- | :--- | | Bank balances and cash | 117.0 | 135.9 | | Borrowings | 160.2 | 139.4 | | Gearing ratio | 76% | 68% | - A decrease in bank balances and cash, coupled with an increase in borrowings, led to a higher gearing ratio, indicating increased financial leverage[56][57] - Approximately HK$53.0 million of leasehold land and buildings were pledged as security for other loans[58] Deposit Paid for Acquisition of Properties The Group has paid a refundable deposit for the acquisition of an office unit in Beijing to serve as the new headquarters for its liquor segment - A deposit of approximately HK$48.4 million has been paid for the acquisition of an office in Beijing, intended as the new headquarters for the liquor segment, with completion expected within the next 12 months[59] Business Prospects and Future Plans for Material Investments The Group is committed to expanding its existing businesses and diversifying its revenue streams by actively seeking profitable investment opportunities - The Group is focused on business diversification and expansion, actively seeking profitable investment opportunities to maximize shareholder value[60] Capital Structure The company's capital structure consists of ordinary shares and convertible bonds that can be converted into company shares - The company's capital structure includes ordinary shares and convertible bonds, with a total of 789,324,526 shares in issue[61] Employment, Training and Development The Group's employee count remained stable, and it continues to offer competitive remuneration and development opportunities Employee Headcount | Indicator | 30 June 2025 | 31 December 2024 | | :--- | :--- | :--- | | Total employees | 368 | 365 | - The Group values employee development, providing training opportunities and competitive compensation packages, with performance-based incentives[62] Other Information Use of Proceeds from Placing of Convertible Bonds The majority of proceeds from the convertible bond placement have been utilized as planned, with a small balance remaining for its intended purpose Use of Proceeds from Placing of Convertible Bonds (HK$ thousands) | Intended Use | Intended Amount | Amount Utilised | | :--- | :--- | :--- | | Construction of Hubei Chinese herbal medicine planting base | 30,000 | 27,000 | | New production line for traditional Chinese medicine decoction pieces | 10,000 | 10,000 | | General working capital | 4,500 | 4,500 | | Total | 44,500 | 41,500 | | Unutilised balance | | 3,000 | - Most of the proceeds have been used as planned for the herbal medicine planting base and production line, with the remaining HK$3.0 million to be used for its original purpose[64] Corporate Governance Practices The company has complied with the Corporate Governance Code, with the exception of one provision regarding director attendance at the AGM - The company complied with the Corporate Governance Code, but several directors were unable to attend the 2025 AGM, deviating from code provision A.6.7[65][66] - All directors have confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rules[67] - The Audit Committee, composed of independent non-executive directors, has reviewed the Group's unaudited condensed consolidated interim financial statements for the six months ended 30 June 2025[68] Purchase, Redemption or Sale of Listed Securities Neither the company nor its subsidiaries engaged in any purchase, redemption, or sale of the company's securities during the period - During the period, the company and its subsidiaries did not engage in any purchase, redemption, or sale of its listed securities[69] Publication of Interim Results and Interim Report The 2025 interim results announcement has been published, and the interim report will be dispatched to shareholders in due course - The 2025 interim results announcement is available on the websites of the Stock Exchange and the company, and the interim report will be sent to shareholders in due course[70] Acknowledgement and Board of Directors Acknowledgement The Board extends its sincere gratitude to all stakeholders for their continuous support - The Board of Directors expresses its gratitude for the support of all stakeholders[71] Board of Directors The Board comprises five executive directors, one non-executive director, and three independent non-executive directors - The Board consists of 5 executive directors, 1 non-executive director, and 3 independent non-executive directors[73]