兴铭控股(08425) - 2024 - 中期财报

Consolidated Financial Statements Unaudited Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended September 30, 2023, revenue increased 9.4% to HKD 53.47 million, but profit attributable to owners declined 36.3% to HKD 3.74 million due to higher administrative expenses and reduced other income Consolidated Statement of Profit or Loss Summary (For the six months ended September 30) | Metric | 2023 (HKD '000) | 2022 (HKD '000) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 53,473 | 48,872 | +9.4% | | Gross Profit | 17,513 | 12,093 | +44.8% | | Administrative Expenses | (12,838) | (7,401) | +73.5% | | Profit Before Income Tax Expense | 4,830 | 6,554 | -26.3% | | Profit Attributable to Owners of the Company | 3,737 | 5,865 | -36.3% | | Basic Earnings Per Share | 0.99 HK cents | 1.47 HK cents | -32.7% | Unaudited Consolidated Statement of Financial Position As of September 30, 2023, total assets were HKD 170 million and net assets (total equity) were HKD 121 million, both slightly up from March 31, 2023, with net current assets significantly increasing to HKD 20.70 million due to reduced current liabilities Consolidated Statement of Financial Position Summary | Metric | As of September 30, 2023 (HKD '000) | As of March 31, 2023 (HKD '000) | Change | | :--- | :--- | :--- | :--- | | Non-current Assets | 125,989 | 133,482 | -5.6% | | Current Assets | 44,278 | 45,180 | -2.0% | | Current Liabilities | 23,574 | 32,599 | -27.7% | | Net Current Assets | 20,704 | 12,581 | +64.6% | | Non-current Liabilities | 25,495 | 28,603 | -10.9% | | Net Assets | 121,197 | 117,460 | +3.2% | | Total Equity | 121,197 | 117,460 | +3.2% | Unaudited Consolidated Statement of Changes in Equity For the six months ended September 30, 2023, total equity increased from HKD 117 million to HKD 121 million, driven by a HKD 3.74 million profit for the period, while the prior year saw a slight decrease due to share repurchases - For the six months ended September 30, 2023, total equity increased to HKD 121 million due to a profit of HKD 3.737 million for the period[6] - In the prior corresponding period (ended September 30, 2022), the company conducted share repurchases totaling HKD 1.191 million[6] Unaudited Consolidated Cash Flow Statement For the six months ended September 30, 2023, net cash from operating activities decreased to HKD 8.35 million, while investing activities shifted to a net inflow, and financing cash outflow increased, resulting in an ending cash balance of HKD 17.35 million Consolidated Cash Flow Statement Summary (For the six months ended September 30) | Metric | 2023 (HKD '000) | 2022 (HKD '000) | | :--- | :--- | :--- | | Net Cash from Operating Activities | 8,348 | 12,712 | | Net Cash from / (Used in) Investing Activities | 3,721 | (15,366) | | Net Cash (Used in) / from Financing Activities | (8,926) | 702 | | Net Increase / (Decrease) in Cash and Cash Equivalents | 3,143 | (1,952) | | Cash and Cash Equivalents at End of Period | 17,350 | 28,470 | Notes to Financial Statements General Information and Accounting Policies The company, an investment holding company registered in the Cayman Islands, primarily engages in the trading, installation, and leasing of gondolas and other construction equipment, with interim financial statements prepared under HKFRS on a historical cost basis and reviewed by the audit committee - The Group primarily engages in the trading, installation, and leasing of gondolas and other construction equipment[12] - The interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards (HKFRS) and on a historical cost basis[14][15] Revenue and Segment Information During the reporting period, total revenue was HKD 53.47 million, with 98% from leasing and related services, which grew 10.4% to HKD 52.42 million, and the company manages all operations as a single segment Revenue Composition (For the six months ended September 30) | Business Type | 2023 (HKD '000) | 2022 (HKD '000) | YoY Change | | :--- | :--- | :--- | :--- | | Leasing and Related Services | 52,420 | 47,474 | +10.4% | | Trading of Equipment and Parts | 1,053 | 1,398 | -24.7% | | Total | 53,473 | 48,872 | +9.4% | - The executive directors consider leasing and related services and trading of equipment and parts as the Group's sole operating segment[18] Profit, Taxation, and Dividends Profit before tax for the period was HKD 4.83 million, a 26.3% decrease year-on-year, with income tax expense of HKD 1.093 million entirely deferred, and the Board did not declare any dividends for the six months ended September 30, 2023 - Key items deducted from profit before tax include depreciation of property, plant and equipment of HKD 8.629 million and staff costs of HKD 13.214 million[19] - Income tax expense amounted to HKD 1.093 million, entirely comprising deferred tax expense[20] - The Board did not declare any dividends for the six months ended September 30, 2023[24] Earnings Per Share For the six months ended September 30, 2023, basic earnings per share decreased to 0.99 HK cents from 1.47 HK cents in the prior period, primarily due to lower profit and a reduction in the weighted average number of ordinary shares outstanding Basic Earnings Per Share Calculation | Metric | For the six months ended September 30, 2023 | For the six months ended September 30, 2022 | | :--- | :--- | :--- | | Profit Attributable to Owners (HKD '000) | 3,737 | 5,865 | | Weighted Average Number of Ordinary Shares (Thousand Shares) | 376,000 | 400,000 | | Basic Earnings Per Share | 0.99 HK cents | 1.47 HK cents | Trade Receivables and Payables As of September 30, 2023, net trade receivables were HKD 23.37 million, largely stable with most within three months, while trade payables decreased to HKD 7.26 million from HKD 10.1 million at the beginning of the period, with a typical credit period of 30 days - Net trade receivables amounted to HKD 23.368 million, with over 78% aged within three months[28] - Trade payables were HKD 7.257 million, with approximately 69% aged within three months[31][33] Management Discussion and Analysis Business Review and Prospects The company's core business involves leasing and trading temporary gondolas and tower cranes, with revenue growing 9.4% due to expanded tower crane leasing services, and it plans to continue a proactive yet cautious strategy to enhance core business and shareholder value - The Group primarily engages in (i) providing leasing services for temporary gondolas, tower cranes, and generators; and (ii) trading of equipment and parts[34] - Revenue for the reporting period increased by 9.4% year-on-year to approximately HKD 53.5 million, primarily driven by the expansion of tower crane leasing services[36] - Looking ahead, the Group will continue to adopt a proactive yet cautious approach to its business strategy, aiming to significantly improve profitability and enhance shareholder value[37] Financial Review During the period, revenue grew 9.4% and gross profit increased 44.8% with margin improving to 32.8%, but a 73.5% surge in administrative expenses due to asset disposal losses and higher staff costs, coupled with significantly reduced other income, led to a 36.3% decline in profit for the period Revenue Analysis For the six months ended September 30, 2023, revenue increased 9.4% to HKD 53.5 million, primarily driven by higher income from tower crane leasing and related services Revenue Changes | Period | Revenue (HKD Million) | YoY Growth | | :--- | :--- | :--- | | For the six months ended September 30, 2023 | 53.5 | +9.4% | | For the six months ended September 30, 2022 | 48.9 | - | Gross Profit Analysis Gross profit significantly increased 44.8% year-on-year to HKD 17.5 million, with the gross profit margin improving from 24.7% to 32.8%, primarily due to revenue growth while cost of sales remained relatively stable Gross Profit and Gross Margin Changes | Period | Gross Profit (HKD Million) | Gross Margin | YoY Growth (Gross Profit) | | :--- | :--- | :--- | :--- | | For the six months ended September 30, 2023 | 17.5 | 32.8% | +44.8% | | For the six months ended September 30, 2022 | 12.1 | 24.7% | - | Expenses and Profit Analysis Administrative expenses surged 73.5% year-on-year to HKD 12.8 million due to asset disposal losses and higher staff and director remuneration, while other income fell from HKD 2.7 million to HKD 0.9 million, resulting in a 36.3% profit decline to HKD 3.7 million - Administrative expenses increased 73.5% from HKD 7.4 million to HKD 12.8 million, primarily due to losses on disposal of property, plant and equipment, increased staff costs, and directors' remuneration[43] - Other income decreased from HKD 2.7 million to HKD 0.9 million, mainly due to government anti-epidemic fund subsidies and higher recovery of impairment losses on trade receivables in the prior period[42] - Profit and total comprehensive income for the period decreased 36.3% from HKD 5.9 million to HKD 3.7 million[45] Liquidity, Capital Structure, and Risk Management The company maintains a sound financial position with cash and cash equivalents of approximately HKD 17.4 million, and its gearing ratio decreased from 26.5% to 18.7%, reflecting reduced financial leverage, while the capital structure was impacted by 2022 share repurchases, and foreign exchange risk remains minimal due to HKD-denominated transactions - As of September 30, 2023, the Group held cash and cash equivalents of approximately HKD 17.4 million (March 31, 2023: approximately HKD 14.2 million)[47] - The gearing ratio decreased from 26.5% (March 31, 2023) to 18.7% (September 30, 2023)[47] - Following the repurchase and cancellation of 24 million shares in 2022, the number of ordinary shares in issue as of September 30, 2023, was 376 million[50] Employee and Remuneration Policy As of September 30, 2023, the Group had 36 full-time employees, a decrease of one from the beginning of the period, with staff costs (including directors' remuneration) significantly increasing to approximately HKD 13.2 million from HKD 9 million in the prior period, mainly due to higher directors' remuneration and employee monthly salaries Employees and Costs | Metric | As of September 30, 2023 | As of March 31, 2023 | | :--- | :--- | :--- | | Number of Full-time Employees | 36 | 37 | | Metric | For the six months ended September 30, 2023 | For the six months ended September 30, 2022 | | Staff Costs (HKD Million) | 13.2 | 9.0 | Corporate Governance and Other Disclosures Disclosure of Directors' and Major Shareholders' Interests As of September 30, 2023, Chairman and CEO Mr. Tang Hing Keung and his spouse Ms. Au Fung Yee collectively held 120 million shares, or 31.9% of total issued shares, through Hing Kat Limited, while another major shareholder, Mr. Li Yu Leung, held 98.524 million shares, representing 26.2% Major Shareholders' Shareholding | Shareholder Name / Designation | Capacity / Nature of Interest | Number of Shares Held | Approximate Percentage | | :--- | :--- | :--- | :--- | | Mr. Tang Hing Keung | Interest in Controlled Corporation | 120,000,000 | 31.9% | | Ms. Au Fung Yee | Spouse's Interest | 120,000,000 | 31.9% | | Hing Kat Limited | Beneficial Interest | 120,000,000 | 31.9% | | Mr. Li Yu Leung | Beneficial Interest | 98,524,000 | 26.2% | Corporate Governance Practices The company largely complied with the Corporate Governance Code during the reporting period, with one deviation: the roles of Chairman and Chief Executive Officer are held by the same individual, Mr. Tang Hing Keung, an arrangement the Board believes provides strong and consistent leadership given his founder status and extensive experience - The company deviated from Corporate Governance Code provision C.2.1, where the roles of Chairman and Chief Executive Officer are not separate and are both held by Mr. Tang Hing Keung[69] - The Board believes this arrangement benefits business operations and management, provides strong and consistent leadership for the Group, and the presence of three independent non-executive directors ensures a balance of power[69] Other Disclosures During the reporting period, the company did not grant any share options, nor did it purchase, sell, or redeem any listed securities, with directors confirming compliance with securities dealing standards, and business progress aligning with prospectus objectives to strengthen its gondola industry position and develop tower crane leasing - No share options have been granted since the adoption of the share option scheme[72] - For the six months ended September 30, 2023, the Group did not purchase, sell, or redeem any of the company's listed securities[75] - The Group has acquired new motors, parts, and additional tower cranes to strengthen its market position and diversify revenue streams, consistent with the objectives outlined in the prospectus[78] Audit Committee The Audit Committee, chaired by Mr. Wu Kin Sang, comprises three independent non-executive directors and is responsible for overseeing financial reporting, risk management, and internal control systems, having reviewed the interim financial statements and report - The Audit Committee is composed of three independent non-executive directors, with Mr. Wu Kin Sang serving as Chairman[82] - The Audit Committee has reviewed the 2023 interim financial statements and this report, deeming their preparation compliant with applicable accounting standards and Listing Rules[82]