Revenue and Profitability - The company achieved revenue of approximately HKD 5,760,000 for the six months ending September 30, 2025, compared to zero revenue in the same period last year, marking a significant turnaround [7]. - The online gaming platform business in the Philippines generated revenue of approximately HKD 5,100,000, contributing about HKD 4,100,000 to the overall gross profit with a gross margin of approximately 80.7% [8]. - The new tea oil trading business in China generated revenue of approximately HKD 700,000 but incurred a loss of about HKD 900,000, indicating high sales costs and operational expenses [9]. - The company recorded a one-time gain of approximately HKD 3,000,000 from a settlement agreement with a former director, significantly enhancing profitability [10]. - A reversal of impairment losses of approximately HKD 30,200,000 was recognized, which was a key factor in improving profitability during the review period [11]. - The company reported a profit before tax of approximately HKD 27,100,000, a significant improvement from a loss of approximately HKD 11,400,000 in the same period last year [16]. - The net profit for the period was approximately HKD 26,400,000, contrasting sharply with a net loss of approximately HKD 11,400,000 in the previous year [17]. - Basic earnings per share were HKD 0.1976, and diluted earnings per share were HKD 0.0975, compared to losses per share of HKD 0.089 in the same period last year [18]. Financial Position - The company’s net debt decreased by approximately HKD 26,900,000 to about HKD 98,600,000 as of September 30, 2025, compared to HKD 125,500,000 on March 31, 2025 [21]. - As of September 30, 2025, the group's total assets and net liabilities were approximately HKD 10,500,000 and HKD 98,600,000, respectively, with a debt-to-asset ratio of approximately 1,038.3% [24]. - The company’s total liabilities as of September 30, 2025, amounted to approximately HKD 98,640,000, indicating a need for improved cash flow management [70]. - The company’s total reserves, including share premium and special reserves, were reported at HKD 571,880,000 as of September 30, 2025 [63]. - The company’s accumulated losses increased to HKD 3,146,283,000 as of September 30, 2025, reflecting ongoing financial challenges [70]. Business Operations and Strategy - The board remains optimistic about the future, expecting continued significant revenue from the new business lines established during the review period [20]. - KTC, a joint venture with WPT, contributed approximately HKD 5,100,000 in revenue since its launch in July 2025, indicating a sustainable and profitable income source for the group [26]. - The newly launched camellia oil business generated approximately HKD 690,000 in revenue with a gross margin of 13.6%, aimed at providing stable long-term income [27]. - The group is optimistic about the online gaming business's future, expecting KTC to become a significant and sustainable contributor to profitability [31]. - The group is exploring opportunities in the AR/VR sector despite selling its core AR/VR entity in February 2025, leveraging past experience [28]. - The group plans to enhance brand awareness and expand distribution networks for the camellia oil business, targeting other potential cities in Guangdong Province [33]. - The group has committed to controlling administrative costs and capital expenditures to alleviate cash flow pressures [30]. - The group has terminated the provision of AR/VR and mobile gaming solutions since February 2025, impacting its operational segments [80]. - The group is actively expanding its casino business in Cambodia and Southeast Asia, with a letter of intent signed with a Vietnamese casino operator on July 28, 2025, to explore the expansion of gaming operations [73]. Shareholder and Governance - As of September 30, 2025, major shareholders include Ms. He Zhi Ying with 35,980,459 shares, representing approximately 125.50% of the issued share capital [42]. - The company has not participated in any arrangements that would allow directors to benefit from acquiring shares or bonds during the review period [40]. - The 2012 share option plan has 1,410,000 unexercised options remaining, which represents about 1.10% of the weighted average number of shares issued during the review period [43]. - No share options were granted, exercised, or canceled under the 2012 plan during the review period, with 964,652 options having lapsed [45]. - Ms. Xiong Dai Kun resigned as an independent non-executive director effective August 1, 2025, leading to non-compliance with several listing rules [46]. - Ms. Zeng Qin was appointed as an independent non-executive director effective September 1, 2025, restoring compliance with the relevant listing rules [48]. - The company has adopted a strict code of conduct for securities trading by directors, ensuring compliance throughout the review period [50]. - The board believes that the dual role of the chairman and CEO provides strong leadership and benefits the company's strategic planning and implementation [51]. Cash Flow and Financing - The company recorded a cash outflow from operating activities of HKD 4,658,000 for the six months ended September 30, 2025, compared to HKD 5,453,000 for the same period in 2024 [67]. - The net cash generated from financing activities was HKD 1,019,000 for the six months ended September 30, 2025, a significant decrease from HKD 5,456,000 in the previous year [67]. - The company has committed to not redeeming HKD 32,000,000 of convertible bonds due on December 30, 2026, to alleviate liquidity pressure [70]. - The company is actively exploring financing options to support its operations and improve liquidity in the coming months [70]. - The company has outstanding convertible bonds with a principal amount of HKD 26,355,000 due within one to two years as of September 30, 2025 [108]. - The company settled approximately HKD 46,831,000 in receivables from Lion King Entertainment as part of a settlement agreement with a former executive [99]. Other Financial Information - The company generated other income of HKD 57,000, down from HKD 68,000 in the previous year, while other gains amounted to HKD 4,116,000, significantly higher than HKD 68,000 in 2024 [87][88]. - The company recorded a gain of HKD 3,004,000 from offsetting assets and liabilities, which was not present in the same period of 2024 [88]. - The company’s interest income from bank deposits was HKD 52,000, down from HKD 68,000 in the previous year [87]. - The company’s employee costs, including directors' remuneration, totaled HKD 1,550,000, slightly down from HKD 1,556,000 in 2024 [90]. - As of September 30, 2025, other receivables amounted to HKD 3,014,000, a significant decrease from HKD 67,676,000 as of March 31, 2025, after accounting for credit loss provisions [99]. - The company reported trade payables of HKD 1,193,000 as of September 30, 2025, with all expected to be settled within one year [101]. - Other payables and accrued expenses increased to HKD 20,019,000 as of September 30, 2025, compared to HKD 30,558,000 as of March 31, 2025 [102]. - The company recognized the equity portion of the first and second convertible bonds at approximately HKD 7,766,000 and HKD 11,930,000 respectively [112]. - The discount rates used for the fair value calculation of the convertible bonds were 22.26% and 16.81% for the first and second bonds respectively [112]. - As of September 30, 2025, there were no conversions of convertible bonds into the company's ordinary shares [112]. Licensing and Agreements - The company entered into a new licensing agreement with WPT, agreeing to pay an annual fee of USD 500,000 for the use of the gaming platform [119]. - The new licensing agreement has an initial term of two years and will automatically renew annually unless terminated early by the company [119]. - The company retains exclusive rights to guide the use of the platform and derive economic benefits from its application [119].
世纪娱乐国际(00959) - 2026 - 中期财报