Ruixin International Holdings Limited Annual Report 2025: Key Investor Insights

Executive Summary

Ruixin International Holdings Limited has released its Annual Report for the year ended 31 December 2025, marking a significant turnaround in its financial and operational performance. The report contains several material developments that are highly relevant to shareholders and may affect share prices, including business revitalisation, financial restructuring, compliance milestones, and potential delisting risk.

Key Financial Highlights

• Revenue Recovery: The Group reported revenue of HK\$39.8 million in 2025, compared to zero revenue in 2024. The surge is attributed to successful vertical integration and capturing strong demand in electronic products.
• Loss Reduction: Net loss narrowed sharply to HK\$10.8 million from HK\$41.7 million in 2024. If non-cash imputed interest expenses are excluded, the operational loss dropped to HK\$5.1 million versus HK\$18.1 million in the prior year.
• Gross Profit: The Group achieved a gross profit of HK\$1.85 million, a meaningful turnaround from an HK\$80,000 gross loss in 2024.
• Expense Control: Administrative expenses fell from HK\$17.3 million to HK\$7.1 million. Finance costs also dropped from HK\$23.7 million to HK\$5.8 million, primarily due to reduced imputed interest expenses.
• Liquidity Position: Bank balances and cash stood at HK\$1.5 million, with a current ratio of 0.056, indicating tight liquidity but improved from 0.008 last year.

Business Operations and Expansion

• The Group revitalised operations by rebuilding teams and executing business expansion plans. Trading of electronic products, especially consumer and home appliances, drove the comeback.
• Subsidiaries in PRC—Hainan Dongjiangrun Technology Limited and Guangdong Guangjing Technology Development Limited—continued trading electronic parts and components.
• The Group is developing proprietary branded electronic products under the “RUIXIN SV” or “SV” trademark, and is launching a flagship online store to tap e-commerce platforms.
• New sales orders of HK\$39.8 million in 2025 and HK\$46.8 million in Q1 2026 signal ongoing business momentum.

Restructuring and Financial Resumption Plan

• Convertible Notes: As of year-end, HK\$158.4 million in convertible notes remain outstanding and are convertible into 158.4 million shares at HK\$1.00 per share. Maturity was 31 January 2025, but the substantial shareholder (Mr. Li Weimin) has agreed not to demand redemption or repayment, preventing insolvency.
• Debt Settlement and Equity Financing: On 16 February 2026, Ruixin entered into a Subscription and Settlement Deed with Mr. Li to raise HK\$34 million via equity subscription. All outstanding convertible notes and shareholder loans will be waived and discharged in full after completion.
• Convertible Bonds: On the same date, Ruixin signed a convertible bond subscription agreement with an independent investor for HK\$19 million, to be used as working capital.
• Additional Funding: A HK\$25 million loan facility was secured from an independent third party for 16 months, further supporting liquidity.
• Chairman’s Remuneration: Ms. Li Yang, Chairlady, agreed to reduce outstanding remuneration from HK\$10.5 million to HK\$2 million and will not demand payment until trading resumes or June 2027.
• Professional Fees: Financial adviser and consultancy providers agreed to defer HK\$3.2 million in fees and future fees until trading resumes or June 2027.

Compliance, Listing Status and Price-Sensitive Developments

• Resumption Guidance: The Stock Exchange issued guidance requiring Ruixin to publish all outstanding financial results, re-comply with governance rules, and demonstrate adequate operations and assets.
• Fulfillment: All required financial results were published by 1 March 2026. The audit disclaimer on going concern was removed. Compliance with Rule 13.24 (sufficient operations/assets), appointment of new independent non-executive directors, and company secretary was achieved.
• Delisting Risk: Despite compliance, on 20 March 2026, the Stock Exchange decided to cancel Ruixin’s listing under Rule 6.01A due to prolonged suspension. Ruixin has applied for a review of the decision, and the outcome remains uncertain.
• Public Float: The Company maintained sufficient public float as required under listing rules.
• Dividend: No dividend declared for 2025 or 2024. The dividend policy remains but payouts are subject to profitability and Board discretion.

Material Events and Risks Investors Should Note

• Trading Suspension: Shares have been suspended since 2 September 2024, pending publication of interim results. Resumption depends on successful completion of the Resumption Plan and Stock Exchange approval.
• Liquidity Risk: Tight liquidity and heavy reliance on shareholder loans and external funding. If the Resumption Plan fails, the Group may not be a going concern, risking asset write-downs and insolvency.
• Convertible Notes and Shareholder Loans: Account for 82.7% of total liabilities. Waiver and discharge of these debts upon completion of the Resumption Plan would significantly improve net asset position.
• Operational Concentration: The largest customer accounted for 35.5% of sales; five largest customers made up 81.9%. Largest supplier contributed 41.7% of purchases; five largest suppliers contributed 84.6%. No director or major shareholder had interests in these parties.

Corporate Governance and Audit

• Audit Committee reviewed and agreed with management’s position regarding going concern and the removal of audit disclaimer.
• Confucius International CPA Limited appointed as auditors replacing SHINEWING (HK) CPA Limited.
• Directors’ remuneration, professional training, and insurance coverage are in place. No director or executive had interests in shares, underlying shares, or debentures of the Company.
• No material acquisitions, disposals, or equity-linked agreements during the period. Share option scheme expired in 2022.

Investor Takeaways

• Ruixin’s turnaround and restructuring are significant, but share trading remains suspended pending Stock Exchange approval of the Resumption Plan.
• Completion of debt settlement, equity financing, and convertible bond issuance will materially improve the Group’s financial position and may trigger share price recovery if trading resumes.
• Risk of delisting persists; investors should monitor developments and the outcome of the Listing Review Committee’s decision.
• Liquidity remains tight; continued support from major shareholders and external funding is vital. Failure of the Resumption Plan could result in insolvency and asset write-downs.
• Business revitalisation and new sales momentum are positive, but operational concentration and dependence on a few major customers and suppliers pose risks.

Disclaimer

This article is for information purposes only and does not constitute investment advice. Investors should consult their own advisors and carefully consider all risks, including the risk of delisting, trading suspension, and liquidity constraints, before making investment decisions related to Ruixin International Holdings Limited.

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