Wong's International Holdings LimitedHKEX: 99

Interim report for 2024

Sep 12, 2024 at 9:17 AM UTC · MarketScreener

WONG'S INTERNATIONAL HOLDINGS LIMITED

王氏國際集團有限公司

(Incorporated in Bermuda with limited liability)

INTERIM REPORT FOR 2024

UNAUDITED INTERIM RESULTS

The board of directors (the "Board" or "Directors") of Wong's International Holdings Limited (the "Company") hereby presents the unaudited condensed consolidated interim financial information of the Company and its subsidiaries (the "Group") for the six months ended 30 June 2024 as follows:

CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2024

		Unaudited
		2024		2023
	Note	HK$'000	HK$'000
Revenue	6	1,224,403		1,680,743
Other income		1,564			8,879
Changes in inventories of finished goods
and work in progress		(51,128)	(21,737)
Raw materials and consumables used		(826,599)	(1,244,988)
Employee benefit expenses		(176,968)	(209,319)
Depreciation	7	(26,229)	(34,886)
Other operating expenses	7	(67,718)	(84,079)
Change in fair value of investment properties	13	(210,927)	1,562
Other gains - net	8	10,977		8,880
Provision for write-down of stock of
completed properties		(21,560)	-
Provision for impairment losses on trade
receivables	15	(20)	(926)

Operating (loss)/profit		(144,205)	104,129
Finance income	9	10,696		11,466
Finance costs	9	(37,385)	(44,200)
Share of (losses)/profits of joint ventures	14	(200,847)	29,836

(Loss)/profit before income tax		(371,741)	101,231
Income tax expense	10	(17,175)	(11,820)

(Loss)/profit after income tax		(388,916)	89,411
(Loss)/profit attributable to owners


of the Company		(388,916)	89,411


Dividends	11	13,158		14,354
(Losses)/earnings per share attributable


to owners of the Company during the
period
Basic	12	(HK$0.81)	HK$0.19


Diluted	12	(HK$0.81)	HK$0.19

The notes on pages 7 to 30 are an integral part of this condensed consolidated interim financial information.

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 30 JUNE 2024

	Unaudited
	2024	2023
	HK$'000	HK$'000
(Loss)/profit for the period	(388,916)	89,411
Other comprehensive income:
Items that may be reclassified to consolidated
income statement:
Cash flow hedge - fair value gains for the period	14,851	14,646
Cash flow hedge - deferred income tax recognised	(2,450)	(2,417)
Currency translation differences:
- Group	(59,230)	(67,391)
Items that will not be reclassified subsequently to
consolidated income statement:
Gain/(loss) on disposal of financial assets at fair
value through other comprehensive income	312	(1,705)
Changes in fair value of financial assets at fair
value through other comprehensive income	(12,875)	(36,738)
Other comprehensive loss for the period,

net of tax	(59,392)	(93,605)
Total comprehensive loss for the period

attributable to the owners of the Company	(448,308)	(4,194)

The notes on pages 7 to 30 are an integral part of this condensed consolidated interim financial information.

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2024

		Unaudited		Audited
		As at		As at
		30 June		31 December
		2024	2023
	Note	HK$'000		HK$'000
ASSETS
Non-current assets
Property, plant and equipment	13	196,159	211,689
Investment properties	13	1,735,269	1,946,822
Right-of-use assets		88,135	98,072
Interests in joint ventures	14	1,852,463	2,071,517
Financial assets at fair value through other
comprehensive income		79,942	100,080
Deferred income tax assets		16,221	19,480
Deposits and other receivables		18,849	24,578
Derivative financial instruments		22,656	11,324
Restricted cash		535		-

		4,010,229	4,483,562
Current assets
Inventories		287,951	372,296
Stock of completed properties		179,842	201,402
Trade receivables	15	692,273	808,589
Prepayments, deposits and other
receivables		80,192	94,613
Financial assets at fair value through other
comprehensive income		38	58
Current income tax recoverable		1,041	1,688
Restricted cash		116,597	121,164
Short-term bank deposits		695,827	284,844
Cash and cash equivalents		423,116	942,040

		2,476,877	2,826,694

Total assets		6,487,106	7,310,256

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2024

(continued)

		Unaudited	Audited
		As at	As at
		30 June	31 December
		2024		2023
	Note	HK$'000	HK$'000
EQUITY
Equity attributable to owners of
the Company
Share capital	18	47,848		47,848
Other reserves		405,451		464,843
Retained earnings
- Dividends		14,355		14,355
- Others		3,543,950		3,947,221

Total equity		4,011,604		4,474,267
LIABILITIES
Non-current liabilities
Derivative financial instruments		-	3,519
Accruals and other payables		6,007		6,153
Lease liabilities		673		1,492
Deferred income tax liabilities		74,187		83,250
Borrowings	17	885,885		935,840

		966,752		1,030,254
Current liabilities
Trade payables	16	462,699		545,647
Accruals and other payables		203,880		219,379
Contract liabilities		147,643		136,502
Lease liabilities		9,045		14,676
Current income tax liabilities		30,450		34,693
Borrowings	17	655,033		854,838

		1,508,750		1,805,735

Total liabilities		2,475,502		2,835,989

Total equity and liabilities		6,487,106		7,310,256

The notes on pages 7 to 30 are an integral part of this condensed consolidated interim financial information.

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 30 JUNE 2024

				Unaudited

		Attributable to owners of the Company

		Share	Share	Other
		capital	premium	reserves		Total
		HK$'000	HK$'000	HK$'000		HK$'000
As at 1 January 2024	47,848		153,025		4,273,394	4,474,267
Comprehensive income		-	-	(388,916)	(388,916)
Loss for the period
Other comprehensive income		-	-	(59,230)	(59,230)
Currency translation differences
Gain on disposal of financial assets at fair value		-	-	312	312
through other comprehensive income
Changes in fair value of financial assets at fair		-	-	(12,875)	(12,875)
value through other comprehensive income
Cash flow hedge - fair value gains for the period		-	-	14,851	14,851
Cash flow hedge - deferred income tax recognised		-	-	(2,450)	(2,450)

Total other comprehensive loss		-	-	(59,392)	(59,392)

Total comprehensive loss		-	-	(448,308)	(448,308)
Transactions with owners		-	-	(14,355)	(14,355)
Dividend paid to owners of the Company

Total transactions with owners		-	-	(14,355)	(14,355)

As at 30 June 2024		47,848		153,025		3,810,731	4,011,604

As at 1 January 2023	47,848		153,025		4,212,220	4,413,093
Comprehensive income
Profit for the period		-	-	89,411	89,411
Other comprehensive income
Currency translation differences		-	-	(67,391)	(67,391)
Loss on disposal of financial assets at fair value
through other comprehensive income		-	-	(1,705)	(1,705)
Changes in fair value of financial assets at fair
value through other comprehensive income		-	-	(36,738)	(36,738)
Cash flow hedge - fair value gains for the period		-	-	14,646	14,646
Cash flow hedge - deferred income tax recognised		-	-	(2,417)	(2,417)

Total other comprehensive loss		-	-	(93,605)	(93,605)

Total comprehensive loss		-	-	(4,194)	(4,194)
Transactions with owners
Dividend paid to owners of the Company		-	-	(21,533)	(21,533)

Total transactions with owners		-	-	(21,533)	(21,533)

As at 30 June 2023	47,848		153,025		4,186,493	4,387,366

The notes on pages 7 to 30 are an integral part of this condensed consolidated interim financial information.

CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2024

	Unaudited
	For the six months ended 30 June
	2024		2023
	HK$'000	HK$'000
Cash flows from operating activities
Net cash generated from operating activities	153,378			187,217
Cash flows from investing activities	(10,347)
Purchase of property, plant and equipment		(5,740)
Proceeds from disposal of property, plant and	1,665
equipment			595
Dividend received from financial assets at fair value	252
through other comprehensive income			1,489
Proceeds from investment in financial assets at fair	7,270
value through other comprehensive income			5,306
(Increase)/decrease in short-term bank deposits	(424,116)		186,683
Decrease in restricted cash	662			2,742
Repayment from joint ventures	18,207			30,345
Interest received	10,696			11,466
Net cash (used in)/generated from investing

activities	(395,711)		232,886
Cash flows from financing activities	(160,672)
(Decrease)/increase in trust receipt bank loans - net		18,676
New bank loans	114,180			416,000
Repayment of bank loans	(203,268)		(544,063)
Payment of lease payment	(6,853)		(8,097)
Dividends paid	(14,355)		(21,533)

Net cash used in financing activities	(270,968)		(139,017)
Net (decrease)/increase in cash and cash equivalents	(513,301)		281,086
Cash and cash equivalents at beginning of the
period	942,040			544,537
Currency translation differences	(5,623)		(52,258)

Cash and cash equivalents at end of the period	423,116			773,365
Analysis of cash and cash equivalents:
366
Cash on hand			311
Cash at bank	422,750			773,054

Cash and cash equivalents at end of the period	423,116			773,365

The notes on pages 7 to 30 are an integral part of this condensed consolidated interim financial information.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION

GENERAL INFORMATION
Wong's International Holdings Limited (the "Company") and its subsidiaries (together the "Group") are principally engaged in the development, manufacture, marketing and distribution of electronics products as well as property holding.
This condensed consolidated interim financial information has not been audited.
BASIS OF PREPARATION
This unaudited condensed consolidated interim financial information ("Interim Financial Information") for the six months ended 30 June 2024 has been prepared in accordance with Hong Kong Accounting Standard ("HKAS") 34, "Interim financial report" issued by the Hong Kong Institute of Certified Public Accountants ("HKICPA"). The Interim Financial Information should be read in conjunction with the annual financial statements for the year ended 31 December 2023, which have been prepared in accordance with Hong Kong Financial Reporting Standards ("HKFRSs").
SIGNIFICANT ACCOUNTING POLICIES
This Interim Financial Information has been prepared under the historical cost convention, as modified by the revaluation of derivative financial instruments, financial assets at fair value through other comprehensive income and investment properties, which are carried at fair value.
Except as described below, the accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2023, as described in those annual financial statements.
Amendments to standards and interpretation adopted by the Group

The following amendments to standards and interpretations are mandatory for first time for the financial year beginning 1 January 2024:

Amendments to HKAS 1	Classification of Liabilities as Current or Non-current
Amendments to HKAS 1	Non-current Liabilities with Covenants
Amendments to HKFRS 16	Lease Liability in a Sale and Leaseback
Hong Kong Interpretation 5	Presentation of Financial Statements
(Revised)	- Classification by the Borrower of a Term Loan
	that Contains a Repayment on Demand Clause
Amendments to HKAS 7 and	Supplier Finance Arrangements
HKFRS 7

There are no amendments to standards and interpretation that are effective for the first time for this interim period that could be expected to have a material impact on the Group.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION

3 SIGNIFICANT ACCOUNTING POLICIES (continued)

New standards, amendments to standards and interpretation issued but not yet applied by the Group

Certain new standards, amendments to standards and interpretation have been published but are not effective for the Group's accounting periods beginning on or after 1 January 2024 and have not been early adopted by the Group. These new standards, amendments to standards and interpretation are set out below:

		Effective for
		annual periods
		beginning on or after
Amendments to HKAS 21	Lack of Exchangeability	1 January 2025
and HKFRS 1
Amendments to HKAS 9	Classification and Measurement of Financial	1 January 2026
and HKFRS 7	Instruments
HKFRS 18	Presentation and Disclosure in Financial	1 January 2027
	Statements
HKFRS 19	Subsidiaries without Public Accountability:	1 January 2027
	Disclosures
Hong Kong Interpretation 5	Presentation of Financial Statements	1 January 2027
	- Classification by the Borrower of
	a Term Loan that contains a Repayment
	on Demand Clause (amendments)
Amendments to HKFRS 10	Sale or Contribution of Assets between An	To be determined
and HKAS 28	Investor and its Associate or Joint Venture

The Directors of the Company are in the process of assessing the financial impact of the adoption of the above new standards, amendments to standards and interpretation. The Directors of the Company will adopt the new standards, amendments to standards and interpretation when they become effective.

4 ESTIMATES

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

In preparing this condensed consolidated interim financial information, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 December 2023.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION

5 FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS

Financial risk factors
The Group's activities expose it to a variety of financial risks: market risk (including currency risk and cash flow interest rate risk), credit risk and liquidity risk.
The condensed consolidated interim financial information does not include all financial risk management information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 December 2023.
The Group has entered into interest rate swap contracts to partially hedge against the risk of interest increase from the Group's variable rate borrowings.
There have been no changes in the risk management department since year end.
Fair value estimation
The table below analyses financial instruments carried at fair value by valuation method. The different levels have been defined as follows:
- Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).
- Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2).
- Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).

The following table presents the Group's financial assets and liabilities that are measured at fair value at 30 June 2024.

	Level 1		Level 2		Level 3	Total
	HK$'000		HK$'000		HK$'000	HK$'000
Assets
Financial assets at fair value through
other comprehensive income	53,881		-	26,099	79,980
Derivative financial instruments	-	22,656		-	22,656

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