Financial Performance - The Group recorded revenue of approximately HK$160.3 million for the first half of 2023, a decrease of 24.7% compared to approximately HK$212.8 million in the same period last year[11]. - The loss attributable to owners of the Company was approximately HK$18.8 million in the first half of 2023, compared to a profit of approximately HK$9.3 million in the same period last year[11]. - The overall performance of the apparel industry was unsatisfactory due to reduced consumer spending on non-essential goods, particularly in North America[10]. - Other income decreased by approximately 20.5% from approximately HK$7.3 million in the first half of 2022 to HK$5.8 million for the six months ended 30 June 2023[25][33]. - Selling and distribution expenses increased by approximately 6.7% from approximately HK$27.7 million in the first half of 2022 to approximately HK$29.6 million in the same period of 2023[27][34]. - Administrative expenses rose by approximately 7.8% from approximately HK$51.1 million in the first half of 2022 to approximately HK$55.0 million in the same period of 2023[28][35]. - Reported net loss for the first half of 2023 was approximately HK$18.8 million, compared to a net profit of approximately HK$9.3 million in the first half of 2022[41][50]. - The company incurred a loss before tax of HK$18,067,000, compared to a profit of HK$13,319,000 in the prior year[129]. - The net loss for the period was HK$18,761,000, contrasting with a profit of HK$9,273,000 in the previous year[131]. - Total comprehensive loss attributable to owners of the company for the period was HK$28,615,000, compared to HK$3,025,000 in the prior year[131]. Cost and Profitability - The gross profit margin decreased to 39.3% in the first half of 2023, down from 40.5% in the first half of 2022, due to high labor costs despite a decrease in raw material and transportation costs[11]. - Gross profit for the same period was HK$62,926,000, down 26.9% from HK$86,165,000 year-over-year[129]. - The cost of sales for the six months ended June 30, 2023, was HK$97,329,000, down 23.2% from HK$126,688,000 in 2022[177]. Assets and Liabilities - As of 30 June 2023, the Group had net current assets of approximately HK$31.4 million, down from approximately HK$70.4 million as of 31 December 2022[43][51]. - Cash and cash equivalents for the Group accounted for approximately HK$32.8 million as of 30 June 2023, compared to approximately HK$62.3 million as of 31 December 2022[52]. - Interest-bearing bank borrowings amounted to approximately HK$25.2 million as of 30 June 2023, an increase from approximately HK$20.9 million as of 31 December 2022[53]. - The current ratio was approximately 1.23, down from 1.52 as of December 31, 2022[54]. - The gearing ratio increased to approximately 23.6% as of June 30, 2023, compared to 21.3% as of December 31, 2022[54]. - Total non-current assets increased to HK$192,094,000 as of June 30, 2023, up from HK$189,170,000 at December 31, 2022, reflecting a growth of 1.5%[133]. - Current assets decreased to HK$169,048,000, down 18% from HK$205,897,000 at December 31, 2022, primarily due to a reduction in cash and cash equivalents[133]. - Total equity decreased to HK$206,648,000 as of June 30, 2023, down 13.6% from HK$239,260,000 at December 31, 2022[134]. Strategic Initiatives - The Group is establishing strategic factories in China, Vietnam, and Bangladesh, with the new factory in Bangladesh nearing completion and production gradually moving there[17]. - The Group launched RFID products during the Review Period, receiving numerous inquiries from existing and potential customers, indicating a resilient sales performance amid challenging conditions[18]. - The Group is actively investing in research and development to explore new RFID products and enhance related technologies and productivity[18]. - The Group acquired a portion of the equity of Primway S.A.R.L, a French packaging company, to create synergies and expand into the international market[19]. - The Group's new factory for fast printing, Yinyibai, launched in December 2022, has enhanced its online retail channel[19]. - The Group is actively expanding its production capabilities with new factories in Bangladesh and Mexico to enhance efficiency and meet growing market demand[20][21]. - The Group plans to invest resources to expand its RFID product market, which is experiencing increasing demand[72]. - The Group plans to expand its fast printing business to the B2B level through Yinyibai, responding to increasing market demand driven by international exhibitions and conferences[77][81]. Market Conditions - The global economy is projected to grow by 2.7% in real terms in 2023, with the Group cautiously optimistic about the apparel label and trim product industries[70]. - Retail sales in Hong Kong grew by 19.6% year-on-year in June 2023, indicating signs of improvement in the retail industry[71]. - The Group's order volume shows signs of stabilization, with some customer projects delayed from early to late 2023, potentially enhancing sales performance[74]. - The Group's factory relocation in Bangladesh is nearing completion, and the Sri Lanka facility is expected to commence production within the year, positioning the Group to capitalize on market improvements[74]. Corporate Governance - The company established an Audit Committee comprising three independent non-executive Directors to oversee financial reporting and internal controls[116]. - The company has maintained compliance with corporate governance standards as outlined in the CG Code[116]. - There were no competing interests reported by the Directors or substantial shareholders for the six months ended June 30, 2023[115]. - The company has not issued any new stock options during the reporting period[103]. - The interests of directors and chief executives in shares are disclosed in accordance with the Securities and Futures Ordinance[108]. Shareholder Information - No interim dividend is recommended for the six months ended June 30, 2023[85]. - Directors and chief executives hold a total of 1,308,000,000 shares, representing approximately 65.4% of the company's total issued share capital[109]. - Charming International, a controlled corporation, holds 1,308,000,000 shares, with Mr. Barry Chan and Ms. Candy Law owning 51% and 49% respectively[112].
常达控股(01433) - 2023 - 中期财报