Carry Wealth Holdings Limited 2025 Annual Report: Key Insights for Investors

Overview and Key Financial Highlights

Carry Wealth Holdings Limited, a Hong Kong-listed garment manufacturer and trader, has published its 2025 annual report. The Group completed a significant operational transition during the year, moving all core manufacturing activities out of China to subcontracting partners in Cambodia and Indonesia, with its Heshan, Mainland China facility now serving only administrative and sample production functions.

• Revenue for 2025 was HK\$315.2 million, a sharp decline from HK\$664.7 million in 2024 (down 52.6%).
• Gross profit fell to HK\$38.0 million from HK\$66.1 million the prior year.
• Net loss for the year expanded to HK\$46.2 million from HK\$33.8 million in 2024.
• Basic and diluted loss per share was HK5.14 cents, compared to HK3.76 cents in 2024.

This dramatic contraction in revenue and widening loss is a key point for investors and may have a significant impact on the Company’s share price. The Group attributes the contraction to operational transition, persistent cost pressures and market volatility.

Business Transformation and Strategic Focus

The Group has restructured its production footprint, with all mainstream orders now fulfilled by subcontractors in Southeast Asia. The Heshan Facility in China no longer carries out core manufacturing. This strategic move is designed to optimize cost-efficiency and regional production flexibility.

In addition to its core garment business, Carry Wealth maintains a securities investment segment focused on Hong Kong-listed securities. However, due to ongoing market volatility, the Group continues to adopt a conservative, capital preservation-focused strategy and does not anticipate aggressive expansion in this segment.

Market Review and Future Outlook

The global garment industry remains challenging, with supply chain disruptions, increasing costs, and rapidly evolving consumer preferences. Carry Wealth plans to enhance sustainability practices, invest in automation and digital tools, and focus on eco-conscious, tech-driven markets. The Group will prioritize liquidity and cash flow safety, closely monitor macroeconomic factors, and proactively evaluate opportunities for long-term growth and shareholder returns.

Shareholders should note the Group’s intention to maintain operational liquidity and cash flow safety amid working capital pressures. Any further contraction in business or adverse macroeconomic developments could have further negative impacts on shareholder value.

Financial Position and Capital Management

• As of 31 December 2025, the Group had no assets pledged as security for borrowings. The prior year’s pledge of land and buildings in Heshan was fully discharged in January 2025.
• No contingent liabilities reported for 2025 or 2024.
• No significant investments, acquisitions, or disposals during the year. The Group does not plan any major investments in the near future.
• No dividend proposed for 2025 (same as 2024). The Company’s share premium account of HK\$257,845,000 may be distributed as fully paid bonus shares, subject to shareholder approval.
• As of 31 December 2025, the Group reported unused tax losses of HK\$152.4 million, with HK\$128.9 million available indefinitely and HK\$23.5 million expiring within five years.

ESG and Corporate Governance

• The Board oversees the Group’s ESG strategy, with a dedicated management team monitoring implementation and reporting.
• A full ESG report will be published alongside the annual report.
• The Group maintains a workforce diversity of 182 employees, with around 62% female employees.

The Group’s Board and Audit Committee have reviewed and found the risk management and internal control systems effective and adequate for the year. No significant control failings were identified.

Shareholder rights are clearly outlined, including the ability to convene special meetings and propose director candidates.

Shareholding and Insider Information

• The largest shareholder is MARS Worldwide Holdings Limited, holding 45.71% of the Company via Zephyrus Capital Limited and beneficial owner Mr. Sun Banggui.
• No director or chief executive has a significant shareholding in the Company.
• No share option scheme is currently in place, and no equity-linked agreements or convertible securities outstanding as at 31 December 2025.
• No significant related party transactions or contracts with controlling shareholders during the year.

Use of Proceeds and Capital Allocation

• In February 2023, the Company raised HK\$48.1 million via share subscription at HK\$0.59 per share. As of year-end 2025, HK\$26.1 million was used for general working capital, with the remainder (intended for M&A and working capital) now expected to be fully utilized by 31 December 2026.

Risk Factors and Key Audit Matters

• Key audit focus was on the impairment assessment of property, plant and equipment and right-of-use assets, which totaled HK\$47.6 million and HK\$9.76 million, respectively.
• No impairment was recorded, but management had to make significant judgments regarding the recoverable amounts amid operational changes and business contraction.

Conclusion and Shareholder Considerations

Key points that may impact the share price:

• Substantial revenue and profit decline, with no dividend payout for the year.
• The successful transition of manufacturing operations may provide future cost benefits but currently comes with significant restructuring and loss.
• Uncertainty remains in both the core business and investment segment, with management maintaining a conservative outlook and not committing to new expansion or investments.
• Large accumulated tax losses could provide future tax benefits if profitability recovers.
• Any significant improvement or deterioration in macroeconomic conditions, customer orders, or cost structure could materially impact future earnings and share price.

Investors should closely monitor the Company’s quarterly updates for any turnaround in revenue or profitability, as well as developments in its Southeast Asia production strategy and ESG commitments.

Disclaimer: This article is an interpretation and analysis of Carry Wealth Holdings Limited’s 2025 Annual Report, prepared for informational purposes only. It does not constitute investment advice. Investors should conduct their own research and consult professional advisors before making investment decisions. The Company’s future performance is subject to multiple risks and uncertainties which could materially affect actual results.

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