Financial Performance - Total contract value signed in the first half of 2022 reached HKD 757,384,000, an increase of 62.2% compared to HKD 466,939,000 in the same period last year[19] - Sales revenue for the first half of 2022 was HKD 348,434,000, nearly unchanged from HKD 348,436,000 in the same period last year, impacted by lockdowns in Shanghai[5] - Gross profit for the first half of 2022 was HKD 47,859,000, a decrease of 6.6% from HKD 51,252,000 in the previous year, with a gross profit margin of 13.7% compared to 14.7% last year[5] - Other income and gains totaled HKD 7,405,000, up 40.5% from HKD 5,269,000 in the previous year, with service income increasing by 56.4% to HKD 6,987,000[6] - Net loss from derivative financial instruments was HKD 4,344,000, an increase of 569.3% from HKD 649,000 in the previous year, primarily due to significant currency exchange losses[8] - Financing costs, net of interest income, increased by 105.3% to HKD 2,946,000 compared to HKD 1,435,000 in the previous year[10] - Share of profit from associates after tax was HKD 2,369,000, a 52.1% increase from HKD 1,558,000 in the previous year, reflecting recovery in European and Chinese markets[13] - Loss attributable to owners of the company was HKD 5,686,000, a significant reduction of 81% from HKD 29,993,000 in the previous year[15] - Basic loss per share was HKD 0.0247, down 81.1% from HKD 0.1304 in the previous year[16] - The company expects significant improvement in revenue for the second half of 2022, driven by a recovery in deliveries and sales[20] Cash and Liquidity - As of June 30, 2022, cash and cash equivalents totaled HKD 51,823,000, down from HKD 65,522,000 on December 31, 2021[24] - The company's inventory balance as of June 30, 2022, was HKD 111,056,000, with inventory turnover days remaining stable at 67 days[24] - Accounts receivable as of June 30, 2022, amounted to HKD 162,483,000, with an increase in turnover days to 85 days from 57 days due to longer credit terms for customers[24] - The net debt-to-equity ratio increased to approximately 42.1% as of June 30, 2022, compared to 26.4% on December 31, 2021, due to higher borrowing levels[27] - The company reported a net financing cost of HKD 2,946 for the first half of 2022, compared to HKD 1,435 in the same period of 2021, reflecting an increase of about 105.5%[58] - The company's cash and cash equivalents as of June 30, 2022, were HKD 51,823, down from HKD 65,522 as of December 31, 2021, indicating a decrease of approximately 20.9%[54] Assets and Liabilities - Total assets as of June 30, 2022, amounted to HKD 965,164, an increase from HKD 885,323 as of December 31, 2021, representing a growth of approximately 9.0%[52] - The company's total liabilities increased to HKD 557,014 as of June 30, 2022, compared to HKD 418,578 as of December 31, 2021, reflecting a rise of about 33.1%[56] - The total equity attributable to the owners of the company decreased to HKD 408,150 as of June 30, 2022, from HKD 466,745 as of December 31, 2021, a decline of about 12.5%[56] - The company’s total liabilities increased, leading to a higher debt-to-equity ratio compared to the previous reporting period[69] Operational Highlights - The value of unfinished orders as of July 31, 2022, was HKD 759,099,000, while the invoiced sales for the first half of 2022 amounted to HKD 348,434,000[20] - The company reported an order volume of HKD 757,384,000 for the first half of 2022, indicating strong performance despite earlier lockdowns[28] - The overall sales volume of new energy vehicles in China is expected to increase by 56% in 2022, benefiting the company's business[28] - The company plans to focus on expanding its market presence and enhancing its product offerings in the upcoming quarters[71] - The company has invested in new technologies and product development to drive future growth and improve operational efficiency[71] Shareholder and Governance - The board decided not to declare any interim dividend for the first half of 2022, but plans to propose a special cash dividend of HKD 0.08 per share pending shareholder approval[17] - As of June 30, 2022, the major shareholder, Mr. Li, held 144,529,982 shares, representing 74.41% of the company[42] - The company has complied with the corporate governance code as of June 30, 2022, ensuring a balance of power and responsibilities within the board[46] - The audit committee reviewed the accounting principles and practices adopted by the group, discussing internal controls and financial reporting matters[50] Financial Risks and Management - The group faced various financial risks, including market risk, credit risk, and liquidity risk, with no significant changes in risk management policies since year-end[84][85] - The company has established foreign currency hedging strategies to mitigate exchange rate risks associated with its sales and purchases[37] Investment and Capital Expenditures - Capital expenditures for the first six months of 2022 totaled HKD 996,000, down from HKD 1,177,000 in the same period of 2021[35] - The company reported a depreciation expense of HKD 4,561,000 for property, plant, and equipment for the six months ended June 30, 2022, compared to HKD 4,737,000 in 2021[110] - The investment in associates showed a slight increase, reaching HKD 62,072,000 as of June 30, 2022, compared to HKD 61,930,000 in the previous year[118] Other Financial Information - The company recorded a loss attributable to owners of the company from continuing operations of HKD 5,686,000 for the six months ended June 30, 2022, compared to a loss of HKD 29,993,000 in the same period of 2021, showing a significant reduction in losses[136] - The company incurred a loss of HKD 13,216,000 due to currency exchange differences during the reporting period[69] - The company provided a loan to OPS-Ingersoll Holding GmbH with a principal value of HKD 16,450,000 as of June 30, 2022, down from HKD 17,717,000 as of December 31, 2021[145] - Interest received from OPS for the period amounted to HKD 458,000, compared to HKD 399,000 in the previous year[145] - A loss provision of HKD 160,000 has been recognized for the loan, consistent with the previous year[145] - The company agreed to sell 649,921 equity securities for a cash consideration of EUR 16,248,025, equivalent to approximately HKD 131,776,358, with the transaction expected to complete in October 2022[146]
力丰(集团)(00387) - 2022 - 中期财报