Key Financial Facts
- Revenue: HK$82.8 million (decreased by 1.9% from HK$84.4 million in 2023).
- Gross Profit: HK$17.7 million (increased by 17.7% from HK$15.1 million in 2023).
- Net Loss: HK$72.1 million (widened from a loss of HK$35.2 million in 2023).
- Net Assets: HK$419 million (down from HK$476.3 million in 2023).
- Cash and Cash Equivalents: HK$22.6 million.
- Borrowings: HK$84.8 million, resulting in a gearing ratio of 20.2% (increased from 15.6% in 2023).
Dividend Announcement
- Dividends: The company does not recommend or declare any dividend for the year ended 30 June 2024.
Business Segment Performance
- Metal Recycling: Revenue decreased to HK$9.8 million from HK$17.4 million in 2023 due to increased competition and difficulty in sourcing scrap metal.
- Motor and Motor Accessories: Revenue increased to HK$63.7 million from HK$60.3 million in 2023, mainly due to higher sales in motor accessories, particularly tires.
- Property Investment: Rental income slightly decreased to HK$3.9 million from HK$4.2 million in 2023. The group holds properties in Hong Kong and China.
- Hotel Leasing (Nepal): Generated revenue of HK$4.8 million, an increase from HK$2.2 million in 2023.
- Money Lending: Loan interest income of HK$307,000, slightly up from HK$298,000 in 2023.
- Securities Trading: Net gain on fair value changes in investments amounted to HK$1.1 million.
- Biological Assets: Total value decreased to HK$190.96 million due to falling timber market prices and the impact of the renminbi depreciation.
Special Activities/Actions for Profitability
- Liquidity Measures: The company undertook a placement of new shares to raise HK$16.3 million to strengthen its financial position, repay debts, and finance working capital.
- Cost-Saving Measures: The Group continued to implement cost-saving measures to improve liquidity.
- Disposal of Property: The company extended the disposal date for an 80% interest in an industrial development in China to 9 December 2024, as a part of efforts to improve cash flow.
Investor Recommendations
- For Current Investors: The company is facing operational challenges, including an increased net loss and declining revenue in key sectors. Investors may want to consider holding for now while monitoring the company’s cost-saving measures and strategic asset sales.
- For Potential Investors: Caution is advised due to the ongoing losses and financial risks. Investors might consider waiting for clearer signs of turnaround in revenue and profitability before taking any investment action.
Disclaimer
This summary is based solely on the provided report and does not account for other market conditions or information. Investment decisions should be made in consultation with a financial advisor.
