CWT INT'L(00521) - 2023 - 中期业绩

Financial Performance This section provides a comprehensive overview of the Group's financial results, including detailed income statements, balance sheets, and explanatory notes Consolidated Financial Statements For the six months ended June 30, 2023, the Group's revenue decreased by 24.2% year-on-year to HK$16.94 billion, primarily due to reduced commodity trading volumes and prices, while profit attributable to owners increased by 6.3% to HK$135 million Consolidated Income Statement This statement details the Group's revenue, gross profit, and net profit for the six months ended June 30, 2023, highlighting changes from the prior year Key Income Statement Figures (Six Months Ended June 30) | Financial Metric | 2023 (HK$ '000) | 2022 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 16,940,835 | 22,348,157 | -24.2% | | Gross Profit | 882,017 | 931,102 | -5.3% | | Profit Before Tax | 230,029 | 242,347 | -5.1% | | Profit for the Period | 159,243 | 172,208 | -7.5% | | Profit Attributable to Owners | 135,023 | 127,048 | +6.3% | | Basic and Diluted EPS (HK Cents) | 1.18 | 1.11 | +6.3% | Consolidated Balance Sheet This statement presents the Group's assets, liabilities, and equity as of June 30, 2023, compared to December 31, 2022 Key Balance Sheet Figures | Financial Metric | As of June 30, 2023 (HK$ '000) | As of Dec 31, 2022 (HK$ '000) | | :--- | :--- | :--- | | Non-current Assets | 6,442,535 | 6,666,101 | | Current Assets | 23,047,777 | 29,838,364 | | Total Assets | 29,490,312 | 36,504,465 | | Current Liabilities | 20,540,552 | 27,522,902 | | Non-current Liabilities | 4,019,563 | 4,150,361 | | Total Liabilities | 24,560,115 | 31,673,263 | | Net Assets | 4,930,197 | 4,831,202 | | Equity Attributable to Owners | 4,749,972 | 4,630,000 | Notes to the Financial Statements This section provides detailed breakdowns of the financial statements, including revenue by segment and geography, and updates on key balance sheet items and legal matters Revenue and Segment Information This section details the Group's revenue breakdown by major product and service lines, customer location, and reportable segment performance for the six months ended June 30 Revenue by Major Product and Service Line (Six Months Ended June 30) | Service Line | 2023 (HK$ '000) | 2022 (HK$ '000) | | :--- | :--- | :--- | | Transportation services | 1,577,214 | 3,357,929 | | Logistics services | 780,599 | 802,767 | | Commodity trading and related services | 13,833,091 | 17,396,028 | | Equipment and facilities maintenance services | 352,326 | 312,188 | | Brokerage services | 320,885 | 315,631 | | Others | 76,720 | 163,614 | | Total | 16,940,835 | 22,348,157 | Revenue by Customer Location (Six Months Ended June 30) | Region | 2023 (HK$ '000) | 2022 (HK$ '000) | | :--- | :--- | :--- | | China | 11,738,582 | 14,218,067 | | Singapore | 1,384,686 | 4,590,332 | | South Korea | 806,008 | 651,438 | | Other Asia Pacific | 1,877,094 | 1,497,324 | | Europe | 863,374 | 1,007,878 | | Others | 271,091 | 381,118 | | Total | 16,940,835 | 22,348,157 | Reportable Segment Performance (Six Months Ended June 30, 2023) | Segment | External Revenue (HK$ '000) | Pre-tax Profit/(Loss) (HK$ '000) | | :--- | :--- | :--- | | Logistics Services | 2,428,144 | 98,844 | | Commodity Trading | 12,862,945 | 44,089 | | Engineering Services | 358,715 | 15,846 | | Financial Services | 1,291,031 | 144,503 | Key Balance Sheet Items This section provides insights into significant changes in trade receivables and payables, including post-period settlements, and an update on a legal case involving a subsidiary - Trade receivables decreased significantly to HK$5.70 billion from HK$12.39 billion[61][62] - A major portion of trade receivables, HK$4.09 billion (US$522.2 million) related to 140 commodity trading transactions, was fully settled on August 29, 2023[61][62] - Trade and other payables decreased to HK$16.34 billion from HK$22.27 billion[64][65] - A balance of HK$4.09 billion (US$522.2 million) related to 140 commodity trading transactions was also fully settled on August 29, 2023[64][65] - A legal case against subsidiary SSPL, for which a provision was made, concluded in August 2023 with an out-of-court settlement[67][68] - An additional provision of HK$125.1 million was made in the previous year to reflect the agreed settlement amount for the SSPL legal case[69] Management Discussion and Analysis This section provides a detailed review of the Group's operational performance across its key business segments, including strategic initiatives and financial highlights Overall Performance Review Despite a 24.2% revenue decrease to HK$16.9 billion due to lower commodity volumes and prices, the Group maintained resilience with a pre-tax profit of HK$230 million, a mere 5.08% decline from H1 2022 - The Group's diversified business strategy proved effective, as improved performance in financial services and commodity trading mitigated the negative impact from freight logistics services[72] H1 2023 Performance Summary | Metric | H1 2023 (HK$ '000) | H1 2022 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 16,940,835 | 22,348,157 | -24.2% | | Profit Before Tax | 230,029 | 242,347 | -5.08% | Logistics Services The Logistics Services segment's revenue and pre-tax profit fell by 43.7% and 64.1% respectively, primarily due to a sharp decline in freight logistics, while warehousing and commodity logistics showed resilience Logistics Services Performance (H1 2023 vs H1 2022) | Metric | H1 2023 (HK$ '000) | H1 2022 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 2,428,144 | 4,314,203 | -43.7% | | Pre-tax Profit | 98,844 | 275,160 | -64.1% | - Warehousing & Integrated Logistics: Warehouses are at full operation, with contracts being renewed at higher market rates[75] - The business is focusing on digitalization and automation to enhance productivity for chemical industry clients[75] - Freight Logistics: This sub-segment faced a complete market reversal from the previous two years, with freight rates falling below pre-pandemic levels due to reduced demand and expanded shipping capacity[79][80] - The Group is implementing strategic changes, including strengthening freight hubs and global client relationships, to counter the downturn[80] - Commodity Logistics: This business showed strong performance, recording a 7.0% increase in revenue and a 6.0% increase in EBITDA compared to the same period last year, driven by strong performance in soft commodity warehousing and logistics services[81] Commodity Trading This segment's revenue slightly decreased by 6.9% to HK$12.86 billion, but it successfully turned a pre-tax loss of HK$13.7 million in H1 2022 into a pre-tax profit of HK$44.1 million in H1 2023 Commodity Trading Performance (H1 2023 vs H1 2022) | Metric | H1 2023 (HK$ '000) | H1 2022 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 12,862,945 | 13,817,001 | -6.9% | | Pre-tax Profit/(Loss) | 44,089 | (13,695) | Turnaround to Profit | - The business expanded its product portfolio by commencing energy products trading[84] - Strategic initiatives include expanding sourcing operations in Africa and developing new product lines in refined metals (aluminum) and energy products with the support of key trading partners[85][93] Engineering Services Engineering Services demonstrated strong performance with an 11.3% increase in revenue to HK$358.7 million and a 31.0% rise in pre-tax profit to HK$15.8 million, driven by securing higher-value contracts Engineering Services Performance (H1 2023 vs H1 2022) | Metric | H1 2023 (HK$ '000) | H1 2022 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 358,715 | 322,295 | +11.3% | | Pre-tax Profit | 15,846 | 12,093 | +31.0% | - The business successfully re-secured a significant contract with Changi Airport Group and renewed multiple other contracts due to excellent operational performance[98] Financial Services The Financial Services segment saw a strategic shift, resulting in a 66.9% revenue decrease but a significant 161.4% increase in pre-tax profit to HK$144.5 million, driven by the derivatives business Financial Services Performance (H1 2023 vs H1 2022) | Metric | H1 2023 (HK$ '000) | H1 2022 (HK$ '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 1,291,031 | 3,894,658 | -66.9% | | Pre-tax Profit | 144,503 | 55,289 | +161.4% | - The significant increase in pre-tax profit was driven by the strong performance of the derivatives business in Asia, following a strategic reallocation of resources away from lower-margin trade services[97] - The segment is actively expanding its geographical presence, with significant progress in establishing a presence in Dubai and Vietnam[94] - It is also pursuing direct clearing memberships with major global exchanges[94] - Investment in digitalization continues, aiming to enhance automation and improve the client onboarding and trading experience, with a retail initiative in Indonesia showing promising early results[95] Liquidity and Financial Resources As of June 30, 2023, the Group held HK$2.29 billion in cash and cash equivalents, with total loans and borrowings at HK$4.91 billion, a decrease from year-end 2022 Liquidity Position | Item | June 30, 2023 (HK$ '000) | Dec 31, 2022 (HK$ '000) | | :--- | :--- | :--- | | Cash and cash equivalents | 2,293,327 | 1,691,622 | | Loans and borrowings | 4,905,293 | 5,732,096 | | - Repayable within one year | 3,412,740 | 4,177,317 | Corporate and Shareholder Information This section covers corporate governance practices, dividend policy, share trading status, and the Group's future strategic outlook Dividends and Share Repurchases The Board of Directors did not declare an interim dividend for the six months ended June 30, 2023, and no share repurchases were made during the period - The Board has not declared an interim dividend for the six months ended June 30, 2023 (H1 2022: Nil)[108] - During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[109] Corporate Governance The company complied with the Corporate Governance Code during the reporting period, with a noted deviation regarding the combined roles of Chairman and CEO, which the Board believes ensures consistent leadership - The company deviated from code provision C.2.1 of the Corporate Governance Code, as the roles of Chairman and Chief Executive Officer are held by the same individual, Mr. Wang Kan[110] - The Board believes this combined role is beneficial for consistent leadership and effective strategic planning, and that a balance of power is maintained through the experienced Board and a sufficient number of Independent Non-executive Directors[1] Future Outlook and Strategy The Group anticipates a challenging global economic environment but will focus on strengthening its core competitiveness and exploring opportunities in developing countries, particularly in China's Hainan Free Trade Port and Southeast Asia - The Group's strategy is to continue strengthening core competitiveness while seeking business opportunities in developing countries to diversify risk[105] - A key focus is exploring opportunities in the Hainan Free Trade Port and Southeast Asian countries through strategic cooperation and joint ventures[105][107] Share Trading Status Trading in the company's shares on the Hong Kong Stock Exchange has been suspended since April 3, 2023, and will remain suspended until further notice - Trading in the Company's shares has been suspended on The Stock Exchange of Hong Kong Limited since 9:00 a.m. on April 3, 2023, and will remain suspended until further notice[4]