Financial Performance - The Group's total revenue increased by HK$3.3 million, or 2.6%, to HK$128.6 million for the first six months of 2022, compared to HK$125.3 million in 2021[8]. - Gross profit improved by HK$3.8 million, or 5.7%, to HK$70.3 million, up from HK$66.5 million in the same period last year[8]. - The Group's consolidated net profit attributable to shareholders slightly improved by HK$0.6 million, or 2.6%, to HK$21.8 million, compared to HK$21.3 million in 2021[8]. - Basic earnings per share rose to 8.86 HK cents, up from 8.64 HK cents in the previous year[8]. - Other income and gains increased by HK$3.4 million, or 141.9%, to HK$5.8 million, driven by subsidies from the HKSAR Government[8]. - Overall expenses rose by HK$1.9 million, or 3.9%, to HK$50.0 million, primarily due to increased depreciation of right-of-use assets[8]. - The Group declared an interim dividend of 6.5 HK cents per ordinary share, up from 6 HK cents in the previous year[8]. - The profit before tax increased to HK$24,982,000, compared to HK$21,793,000 in 2021, reflecting a rise of 10.0%[57]. - Profit for the period was HK$21,826,000, slightly higher than HK$21,263,000 in the previous year, marking an increase of 2.6%[59]. - The total tax charge for the period was HK$3,156,000, significantly higher than HK$530,000 in 2021, marking a substantial increase of 496.2%[155]. Business Segments - The Group's Application Software business experienced mild revenue growth despite challenges from the Pandemic and talent shortages[10]. - The Human Resources Management Software (HRMS) business in Hong Kong grew steadily, benefiting from a strong order backlog and increasing recurring income[12]. - The HRMS business in Mainland China faced significant impacts due to COVID-19 lockdowns, with considerable falls in both revenue and profit contributions[13]. - The revenue from the Group's Solutions and Integration Services business increased by HK$3.2 million, or 7.2%, to HK$48.4 million, while profit contributions improved by HK$3.0 million, or 43.6%, to HK$9.9 million[21]. - The Group's Integration Services business recorded significant growth in revenue and profit contributions, largely unaffected by the Pandemic during the reporting period[23]. - The Group's e-Service business faced declines in both revenue and profit contributions due to the Pandemic and a slowdown in trade activities, prompting management to explore new value-added service offerings[25]. - The Group's human resources management software business saw steady growth from existing customers and new contracts from various industries, despite challenges from COVID-19 restrictions[16]. - The performance of Development Services improved compared to the previous year, with new sales gradually resuming after initial disruptions caused by the Pandemic[22]. Financial Position - Non-current assets decreased by HK$6.4 million or 2.2% to HK$277.7 million, down from HK$284.1 million as of December 31, 2021[34]. - Current assets dropped by HK$9.9 million or 2.5% to HK$387.4 million, attributed to a decrease in cash and cash equivalents after the final dividend dispatch[34]. - The Group's total current and non-current liabilities decreased by HK$8.3 million, or 5.3%, to HK$149.3 million as of 30 June 2022[35]. - Total equity attributable to owners of the parent slightly dropped by HK$7.8 million, or 1.5%, to HK$514.3 million as of 30 June 2022[35]. - The Group's cash and cash equivalents were HK$285.6 million as of 30 June 2022, down from HK$298.4 million as of 31 December 2021[39]. - The Group had no bank borrowings as of 30 June 2022, maintaining a current ratio of 3.0 and a gearing ratio of 22.5%[41]. - The Group's liquidity position has been maintained through prudent financial management and ongoing credit assessments[41]. Employee and Operational Changes - The number of full-time employees decreased to 354 as of 30 June 2022, down from 367 as of 31 December 2021[43]. - The Group relocated its resource center in Shenzhen to a larger office to support workforce expansion and long-term business development amid the Pandemic[24]. - The Group's remuneration policies remain consistent with those disclosed in the previous annual report, offering discretionary bonuses and incentives[42]. Investments and Assets - The Group's investment segment reported a loss of HK$0.4 million in the first half of 2022, down from a profit of HK$2.5 million in the same period last year due to downward adjustments in the valuation of financial assets and investment properties[26]. - The Group completed the subscription of 10,000 new shares in CISC Limited, increasing its shareholding from 40% to 80% for a total consideration of HK$1,450,000[49]. - The Group's financial assets and investment properties recorded valuation losses of HK$1.6 million due to downtrend market sentiment caused by the Pandemic[34]. Revenue Recognition and Performance Obligations - Revenue expected to be recognized within one year is HK$51,355,000, a decrease of 20.3% from HK$64,440,000 in 2021[142]. - Revenue expected to be recognized after one year is HK$1,172,000, slightly up from HK$1,098,000 in 2021[142]. - The performance obligation for the sale of goods and provision of software is satisfied upon delivery, with payment generally due within 30 to 60 days[138]. - The company continues to focus on expanding its service offerings and enhancing customer satisfaction to meet performance obligations effectively[138]. Compliance and Reporting Standards - The unaudited interim condensed consolidated financial information was prepared in accordance with the applicable provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[93]. - The Group adopted revised Hong Kong Financial Reporting Standards (HKFRSs) for the first time, including amendments to HKFRS 3, HKFRS 16, HKAS 16, and HKAS 37, which did not significantly impact the financial position or performance of the Group[96]. - The Group applied the amendments to HKAS 16 retrospectively to items made available for use after January 1, 2021, with no sales occurring during this period, resulting in no impact on financial performance[99]. Trade Receivables and Credit Risk Management - Trade receivables as of June 30, 2022, amounted to HK$41,052,000, down from HK$48,778,000 as of December 31, 2021, indicating a decrease of approximately 15.7%[193]. - The impairment of trade receivables increased to HK$3,437,000 as of June 30, 2022, compared to HK$3,177,000 at the end of 2021[193]. - The credit risk exposure is assessed at each reporting date, utilizing a provision matrix to ensure accurate measurement of expected credit losses[200]. - The overall management of trade receivables does not involve holding any collateral or making other credit enhancements[194].
科联系统(00046) - 2022 - 中期财报