In the second half of 2024, the global political and economic landscape remained tense, the foreign exchange market was volatile, the Fed rate cuts fell short of expectations, and the price of plastic materials hovered at a low level. Despite the challenging external environment, the Group was able to continuously enhance its operational and revenue efficiency by implementing prudent strategies, optimising its product portfolio, and effectively capturing market opportunities. The Group recorded an increase in turnover against the same period last year.

During the period under review, the Group’s overall gross profit increased. Continuing to implement stringent cost trimming measures, gross profit margin of the Group widened against the same period last year. Loss attributable to equity holders of the Company narrowed significantly. In addition, by executing an effective operating strategy, the Group’s operating performance steadily improved in the second half of 2024. Compared with the operating loss recorded in the same period last year, the Group achieved a turnaround during the period, with an operating profit.

During the period under review, the end products of the engineering plastic products business, such as general household electrical appliances, household products and high-end kitchenware, continued to show steady development owing to a solid customer base and stable market demand. It is worth noting that the engineering plastics business for tailormade toys, which was under pressure during the epidemic, benefited from the economic recovery and saw a surge in orders, signalling an upturn. Bolstered by this momentum, the Group’s sales team also seized the opportunity to actively expand the customer base and optimise the pricing strategy, achieving growth in both sales volume and price during the period, driving an year-on-year increase in turnover, with gross profit margin increase. Profit before taxation soared. The business has returned to profitability.

The Group has a broad customer base and diverse product channels for the colorants, pigments, and compounded plastic resins business. In addition to its traditional business in industries such as automotive applications, food packaging and new energy, the Group provides high-value-added colorants processing services to international automotive brands and ICT products. During the period, the Group actively engaged with its overseas customers who had previously returned to domestic production and consistently strengthened collaborative ties with them, resulting in a similar trend in order volume as the previous year. Turnover remained largely unchanged from the same period of last year, with gross profit margin similar to that of the same period last year.

As international crude oil price continued to weaken during the period, the price of plastic materials experienced industry-wide pressure. Against this backdrop, the management team continued to capitalise on the low-cost opportunity, driving a slight increase in overall sales, which boosted the turnover of the plastic raw material trading business against the same period last year, with gross profit margin recording a slight increase. Amidst the high-interest rate environment, the market sentiment was relatively weak, and the business continued to be affected by persistently high finance costs; however, segment loss before taxation narrowed.

 

HUI Sai Chung
Chairman