Press Release
Revenue increased by 133% to HK$216 million Environmental Protection Business Contributes 65.6% of Revenue
REALORD'S 1H2017 INTERIM RESULTS HIGHLIGHTS
(HK$’000)
For the six months
ended 30 June
Changes (%)
1H2017
1H2016
Turnover
216,233
92,844
+133.0%
Gross Profit
52,280
41,674
+25.45%
Profit/(Loss)
87,091
81,689
+6.61%
Profit/(Loss) Attributable to The Equity Holders
84,273
81,689
+3.16%
Earnings Per Share (HK Cent)
7.33
7.08
+3.53%
As at
30/6/2017
As at
31/12/2016
Cash & Cash Equivalent
82,294
51,791
+58.90%
Total Assets
2,023,813
1,607,846
+25.80%
Total Equity
1,027,272
898,097
+14.38%
(August 28, 2017 - Hong Kong) Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleased to announce its unaudited interim results for the six months ended 30 June 2017 (the “Period”). The Group’s results recorded an increase in profit by 6.6% to approximately HK$87.09 million for the Period.
For the period under review, the Group recorded a turnover of approximately HK$216.2 million for the six months ended 30 June 2017, representing a significant increase by 133.0%. The increase in the turnover of the Group was primarily due to the Group consolidating the operating performance attributable to the Environmental Protection Segment, amounted to approximately HK$141.9 million since the acquisition of Realord Environmental Protection Industrial Company Limited (formerly known as Top Eagle International Trading Limited). The overall decrease in the gross margin was due to the low gross profit margin achieved by Environmental Protection Segment, which contributed the majority part of the turnover of the Group. During the period, the results recorded approximately HK$87.09 million of profit. The earnings per share was HK7.33 cents.
The increase in profit attributable to the equity holders was mainly due to the fair value gain on investment properties amounted to approximately HK$144.1 million, but partly offset by the related deferred taxation of the fair value gain of approximately HK$41.6 million and the increase in corporate expenses.
Business review
The newly acquired Environment Protection Segment recorded a revenue of approximately HK$141.9 million during the period under review, representing 65.6% of total revenue of the Group. The segment result was profit of approximately HK$8.0 million during the period under review.
The Commercial Printing Segment recorded a revenue of approximately HK$38.9 million during the period under review, representing 18.0% of the total revenue of the Group. There was a slight increase in segment revenue of 1.2% to approximately HK$38.9 million as compared to approximately HK$38.4 million in the last corresponding period. However, the inflating operating cost resulted in similar level of operating profit of approximately HK$0.4 million for the period under review and the last corresponding period.
The Financial Services Segment recorded a revenue of approximately HK$5.4 million during the period under review, representing 2.5% of the total revenue of the Group. The revenue from this segment remained stable as compared from approximately HK$5.3 million in the last corresponding period to approximately HK$5.4 million during the period under review. The segment results increased from profit of approximately HK$1.1 million in the last corresponding period to profit of approximately HK$1.9 million during the period under review.
The Property Investment Segment recorded a revenue of approximately HK$9.1 million during the period under review, representing 4.2% of the total revenue of the Group. The revenue from this segment recorded approximately HK$9.1 million as compared to approximately HK$5.5 million in the last corresponding period. The profit from this segment decreased from approximately HK$179.1 million in the last corresponding period to approximately HK$150.8 million during the period under review. The decrease was mainly due to the fair value gain on investment properties being recorded during the period under review amounted to approximately HK$144.1 million was less than that in the last corresponding period.
The Motor Vehicle Parts Segment recorded a revenue of approximately HK$19.3 million during the period under review, representing 8.9% of the total revenue of the Group. With a view of tightening the credit control policy and shortening of credit period granted to the customers, the segment revenue noted a significant decrease by 50.2% to approximately HK$19.3 million as compared to approximately HK$38.8 million in the last corresponding period. The segment recorded a profit of approximately HK$0.1 million during the period under review as compared to a profit of approximately HK$1.7 million in the last corresponding period.
The Hangtag Segment recorded a revenue of approximately HK$1.6 million during the period under review, representing 0.7% of the total revenue of the Group. The segment revenue decreased significantly of 66.3% from the last corresponding period of approximately HK$4.8 million to approximately HK$1.6 million for the period under review. Through implementation of continuing cost control measures, including outsourcing part of manufacturing processes, the loss from this segment remained in a low level of HK$0.1 million during the period under review comparing to approximately HK$0.4 million in the last corresponding period.
Outlook
On 28 February 2017, the Group completed the acquisition of 60% equity interest of Realord Environmental Protection Industrial Company Limited (formerly known as Top Eagle International Trading Limited), which can diversify the business of the Group with the objective of broadening its sources of income. The Directors are optimistic about the prospects of the environmental protection industry and are of the view that it is an opportunity for the Group to further diversify the business scope of the Group through the acquisition. The Environmental Protection segment is engaged in dismantling and trading of scrap materials (e.g. scrap metal and PVC waste) and acting as an agent by sourcing scrap materials. The operating base is located in Wuzhou Import Renewable Resources Processing Park. Moreover, the Group has entered in an investment agreement, which costs approximately RMB 350 million to carry out a recycling and production of aluminum ingots project in the Park with a target annual production capacity of 100,000 tonnes, which means the Environmental Protection business will be strengthened.
The operating environment of the commercial printing and hangtag businesses will continue to be competitive in the coming years. The Group shall strengthen its business development team to achieve sales growth and increase market share, however, the intense competition in the Commercial Printing Segment shall limit the Group to pass the inflating operating cost to customers. Due to the persistent increase in production cost in the PRC, some of the customers shift its demand to other developing countries in Asia-Pacific region, the operating environment of Hangtag Segment is even more challenging and we foresee that customers’ demand of hangtags labels, shirt paper boards and plastic bags would keep diminishing.
The Group is in the process to set up the PRC operations of Motor Vehicle Parts Segment in Guangzhou. We expect that the PRC operations will effectively contribute to the business expansion of the sales and distribution of motor vehicle parts business. Besides, the Group is in the process to develop the financial services business, which would provide financial services including securities brokerage, margin financing, money lending and financial leasing services. The Group had entered into an agreement with 5 other independent third parties to set up a joint venture Security Company named “Yuegang Securities Limited” to carry out securities businesses in Nansha Free Trade Zone, Guangzhou, the PRC. Through the Security Company, the Group could tap into the securities business in the PRC, which was considered as a strictly regulated industry. We believe the set-up of the Security Company, when materialised, represents a valuable investment opportunity for the Group to expand its securities services business and to enable the Group to exchange its business network and relationship in the PRC, and hence to gain a foothold in the PRC market.
Looking forward, the Group is optimistic about the prospects of the environmental protection industry and are of the view that it is an opportunity for the Group to further diversify the business scope of the Group through the acquisition. The Group will strike to explore for any potential real estate development or property investment opportunities. For sustaining a long-term growth, we will also keep on exploring all potential opportunity to develop its businesses.
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Realord in HKEx’s CAS Phase 2 Stock List
(June 18, 2017 – Hong Kong) Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleased to announce that the Group is included in the list of securities for Phase 2 of the Closing Auction Session (CAS) announced by Hong Kong Exchanges and Clearing Limited (HKEx), which will roll out in its securities market on next Monday, 24 July 2017.
The newly additions in the list of the phase 2, including Realord Group Holding Limited, are 150 constituents of Hang Seng Composite SmallCap Index (HSSI). The total 670 securities with CAS will accept at-auction, at-auction limit orders, and the regulated short selling orders during the session. The price of short selling orders cannot be lower than the CAS Reference Price at 4pm.
About the Closing Auction Session (CAS)
The current CAS is set up for the constituent stocks for indices and funds, to meet the market demand, to provide more efficient closing transactions to ensure the market’s normal operation, and to stabilize its price volatility. The launch of the Closing Auction Session means the trading hours will be extended for more ten minutes to close at 4:10 pm. The investors may set up at-auction and at-auction limit orders during the session.
The closing auction session is implemented into two phases. On 25 July 2016, constituents of the Hang Seng Composite LargeCap and MidCap Index, A/H stocks, and ETFs were the stocks applied with CAS in phase 1.
During the phase 2, the HSSI constituents were newly included in the list and some originally from the list were deleted due to the removal from the respective indices. What is more, the securities in the CAS list accept the regulated short selling orders. The launch of CAS enables to meet market demand that is convenient for investors, especially institutional investors and fund managers, for trade execution at securities’ closing prices
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Realord Takes a Trial Ride of Shenzhen Tram
(July 9, 2017 – Shenzhen) The trial operation of Shenzhen Tram (SZT) in Longhua District, Shenzhen is already begun that also invites the local citizens, especially the organizations or groups, to have trial rides since 1 July 2017. Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleasure to join this trial ride and to experience the convenience of the direct connection between Line 4, Shenzhen Metro and SZT, particularly visiting Realord Villas (an unlisted property of the Group) and viewing the surrounding sceneries.
Starting from Qinghu (Tram) Station and pass through about nine stations, the destination of this journey was High-tech Zone Station which took less than half an hour. Before the tour began, some of the colleagues had taken a bus M212 from Realord Villas station to Qinghu station for half an hour. Realord Villas is located between High-tech Zone Station and High-tech Zone East Station.
Dr. Bryan Lin, Xiaohui, Chairman of Realord Group, said: “Thanks to Shenzhen Tram’s kindly arrangement for us to have such wonderful experience and we really appreciate that our staff could take time participating in this activity. With SZT, Bus, and other public transportation facilitated, Realord Villas will be more convenient in the future. "
About Shenzhen Tram
Established in January 28, 2016 and jointly invested by China Railway Group Limited (CREC) and Shenzhen Metro Group Co., Ltd (SZMC), Shenzhen Modern Tram Company Limited is engaged in construction, operation, operation and along the comprehensive development of resources and the main business, which are fully inherited from the advantages of SZMC's operation serivces and CREC's high-end construction integration and capabilities, to create a modern, efficient, and a famous brand as the business goals, striving for being one of the first-class tram operation and service entreprises.
Realord’s Major Shareholders Increase Stake Twice in the First Half of 2017
(July 5, 2017 – Hong Kong) Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleased to announce that our Major Shareholders Dr. Bryan Lin, Xiaohui, (also known as the Group’s Chairman) and Madam Su, Jiaohu (CEO of the Group) acquired 4,300,000 shares of the Company at an average price of HK$4.105 per share on 28 June 2017 and 430,000 shares of the Company at an average price of HK$4.319 per share on 30 June 2017, with total turnover amounted to HK$ 1,950.867 million. The Major Shareholder of the Group increased its stake in the Group from 68.45% to 68.82%, with total 791,891,518 shares.
It reflects the confidence of the Major Shareholders for the Group’s value and its business development in the future. On 15 September 2016, Lin and Su purchased 166.4 million shares at an average price of HK$5.32 per share, with total turnover amounted to HK$885 million.
Guangxi Wuzhou Longxu District Committee Secretary Song Tongyu visits Realord Group
(June 21, 2017 – Shenzhen) Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleased to announce that Mr. Song Tong Yu, Committee Secretary of Longxu Distirct, Wuzhou, Guangxi; Mr. Lin Yuan, Vice Committee Secretary of Longxu District and Ms. Luo Yan Ping, Director of Publicity & Vice Governor of Longxu District visited the Group to conduct research, to give guidances and to listen the needs of enterprises.
Accompanied by the Group’s subsidiary Top Eagle International Trading Limited (“Top Eagle” or "the Company") whose representatives including Mr. Zheng Wei Min, the Managing Director and other top managers, the Longxu leaders had visited the Group's Shenzhen office and had a meeting about the latest recycling and production of aluminum ingots investment project in Wuzhou Import Renewable Resources Processing Park.
During the meeting, the Longxu leaders knew more about the situation of the investment project, and would try to make an arrangement for the project members to meet representatives of the related departments of Wuzhou Government in hopes of forming a project team as soon as possible.
In June 2017, Top Eagle entered an agreement wih Wuzhou Import Renewable Resources Processing Park to carry out a recycling and production of aluminum ingots project,with a target annual production capacity of 100,000 tonnes. The total investment amount is approximately RMB 350 million, which is used for construction of the processing plant and office premises, plant and machinery acquisitions and development of renewable aluminum industry chain to solve the dilemma with the current renewable aluminum industry in the Park.
Led by Mr. Guo Zhuang Ming, Vice Governor of Longxu District in mid-May 2017, Mr. Lin Deyao, the Director of Development and Reform Bureau, Mr. Li Xiong, the Director of Investment Promotion Bureau, Mr. Cai Weidong, the Director of Information and Technology Bureau, and other leaders had visited Realord Group to understand the needs of the investment project and provide assistance for the preliminary work.
Dr. Bryan Lin, Xiaohui, Chairman of Realord Group, said: "We, the Group, are honored to have Wuzhou Longxu District government leaders’ attention, advice and support. The executives of Top Eagle are now actively carrying out the preparatory work. We sincerely hope that our project be carried out into the production process soon. "
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About Wuzhou Longxu District
Longxu District was approved by the State Council of the Chinese Government on February 8, 2013. It is currently the largest and most potential new district in Wuzhou, Guangxi. The area has cultivated four large-scale industrial parks, such as Wuzhou Imported Renewable Resources Processing Park, Cangwu Industrial Park, Si Le Tang Industrial Concentration Zone and Social Science Industrial New Town, which have gathered the processing of renewable resources, nonferrous metal smelting, building materials, machinery manufacturing and forest Chemical, electronic equipment. Among them, Wuzhou Import Renewable Resources Processing Park is a demonstration base of "urban mining", "urban and country" and "closed-circle management", also as the key industrial park of Guangxi Zhuang Autonomous Region, the pilot industrial park of circular economy, and the core project of the development of renewable resources industry in Guangxi.
Realord Expands The Environmental Protection Business In Wuzhou, Guangxi Invest In A Recycling And Production Of Aluminium Ingots Project With 100,000 Tonnes Target Annual Production Capacity
(June 8, 2017 – Hong Kong) Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleased to announce that Top Eagle International Trading Limited (“Top Eagle”) , an indirect 60%-owned subsidiary of the Company, has entered in an investment agreement with Wuzhou Import Renewable Resources Processing Park Management Committee (the “Committee”). The cooperation carried out a recycling and production of aluminum ingots project in Wuzhou Import Renewable Resources Processing Park (the "Park") with a target annual production capacity of 100,000 tonnes. The total investment amount is approximately RMB 350 million. The project will further enhance the Company's recycling business in renewable resources, and improve the renewable aluminum business planning in the park.
To solve the dilemma with the current renewable aluminum industry in the Park, the Committee has been seeking investment precisely to complement full-chain industry, and entered an investment agreement with Top Eagle. The cooperation introduced a recycling and production project of aluminum ingots with a target annual production capacity of 100,000 tonnes into the park. The project is belonged to a midstream project of renewable aluminum industry chain. It mainly engages in recycling and production of aluminum ingots, and plays an important role in enhancing and connecting the upstream and downstream of renewable aluminum industry chain in the park. The project is beneficial to the closed-cycle of circular economy within the park, and accelerates the development of renewable resources industry.
According to the agreement, Top Eagle will build a processing plant for the recycling and production of aluminum ingots in Wuzhou Import Renewable Resources Processing Park located in Wuzhou City, Guangxi Province. The target annual production capacity of the project will reach 100,000 tonnes to be ramped up in two phases. The total investment amount is approximately RMB350 million, and not limited to acquisitions of the site, construction of the processing plant and office premises, plant and machinery acquisitions. The investment and development will divided into Phase One Site and Phase Two Site with a total area of 129 mu. The phase one investment will be approximately RMB250 million with a site area of approximately 80 mu (equivalent to approximately 53,360 square meters), while the phase two will be approximately RMB100 million with a site area of approximately 49 mu (equivalent to approximately 32,683 square meters). The term of the land use rights of the Site is 50 years.
Top Eagle International Trading Limited, an indirect 60%-owned subsidiary of the Company, is mainly engaged in recycling, dismantling and sales of scrap materials, such as copper, aluminum, iron and plastic. The new processing plant to be established under the Investment Agreement introduces more complicated melting process for the production of aluminum ingots. The new processing plant would elevate its existing scrap material business with a more value-added model and higher profit margin, and it also provides a favourable environment for the Group to further develop its business.
About Top Eagle International Trading Limited
Top Eagle International Trading Limited engaged in recycling dismantling and sales of scrap materials such as copper, aluminum, iron, and plastic.
About Wuzhou Import Renewable Resources Processing Park
Wuzhou Import Renewable Resources Processing Park located in Wuzhou City, Guangxi Province, one of the demonstration cities of circular economy in the PRC. The park is a demonstration park of national "closed-circle management" strategy in national import renewable resources, and also known as "urban mining" demonstration base, which has been approved by the National Development and Reform Commission and the Ministry of Finance since 2011. It is mainly engaged in the recycling, processing and utilization of renewable resources as the key industrial park of Guangxi Zhuang Autonomous Region, the pilot industrial park of circular economy, and the core of the development of renewable resources industry in Guangxi. In October 2015, the park was identified as “Guangxi Industrial Park for Integration of Informatization and Industrialization in 2015”.
Realord Group Enhances its Business in Automobile Aftermarket
(May 24, 2017 – Hong Kong) Realord Group Holdings Limited (“Realord” or the “Company,” together with its subsidiaries collectively known as the “Group,” stock code: 1196.HK) is pleased to announce that the vehicle parts retail shop of its subsidiary “Realord Vehicle Parts Limited”, located at To Kwa Wan, has officially opened. It is a new milestone for the Company’s vehicle parts business that extends from distributing to retailing and furtherly connects with the consumers’ market.
Dr. Bryan Lin, Xiaohui, Chairman of Realord Group; Ms. Su Jiaohua, Suki, Chief Executive Officer; Mr. Lin Xiaodong, Trevor, Executive Director; Mr. Chan, Keith Ying Kay, Chief Financial Officer, and General Manager of Guangzhou Realord Vehicle Parts Limited Mr. Lin Yibin, Ben attended the opening ceremony.
Dr. Bryan Lin, Xiaohui, Chairman of Realord Group, said: "We are glad to see the growth of Realord Vehicle Parts in the past three years, and we are confident towards the future development of this business."
Mr. Lin Xiaodong, Trevor, Executive Director of Realord Group, said: "To be more effective in reaching customers at different levels in particular the vehicle-related services providers and the consumers, establishing retail stores is absolutely imperative for us. Vehicle parts market is full of infinite opportunities and challenges, thus we will be positive and optimistic to operate and expand. What’s more, we will pay efforts to expand our dealership, distributorship and the variety of goods meeting the demands, and to attract more customers by deploying different promotional strategies.”
"Realord Vehicle Parts Limited", which engages in selling various luxury automobile parts, has been operating in Hong Kong since October 2014. Domestic Repair shops and distributors in the PRC and Hong Kong are the main customers. The base and warehouse are stationed at Ha Tsuen, Yuen Long in the New Territories where can store amount of auto parts with large size. A newly opened retail store “Realord Vehicle Parts” is located at Shop B, 157-159 Kowloon City Road, To Kwa Wan, Kowloon, Hong Kong in which customers find one more way to purchase products, so it makes a better and more comprehensive sales service.
According to the Annual Report in 2016 of Realord Group, vehicle parts segment has contributed HK $100.6 million in the year, accounting for 48% of the Group's total revenue, increased 5.5% year-on-year.
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Realord Group Sponsors A Stock & Finance Video Broadcasting Show on the Internet
(May 22, 2017 - Hong Kong) To help enhance company’s online presence and visibility, Realord Group Holdings Limited (“Realord” or the “Company”, together with its subsidiaries collectively known as the “Group”, stock code: 1196.HK) has sponsors an online video broadcasting show called “Siu Yu Dai Cha Fan (小魚大茶飯)” discussing Hong Kong stock market and related finance issues since 8th May 2017. The show is organized by a local financial magazine company “Strategist” which uses a relaxed and humorous way to analyze the Hong Kong stocks, to interact with the audience and to share the investment experiences on the Internet.
Sponsored by Realord Group, the show was launched on 8th May 2017 and the period of sponsorship will run for six months. The show broadcasts at 9:55 to 10:30 am on Mondays to Fridays (for HKEx transaction days only) via Strategist’s Facebook channel. The hosts include Mr. Wong Shang Yu (nickname as Jiang Xiao Yu) and Miss June Lam. Mr. Wong is a veteran Hong Kong stock market commentator who worked as a host of a section “Siu Yu Dai Cha Fan” in a TV Financial news program “Money Smart” in the channel HD Jade on Television Broadcasts Limited (“TVB”) while Miss June Lam is a former news anchor, reporter, and editor in TVB.
About Strategist
“Strategist” is a Hong Kong financial magazine which has been published continuously every Friday since its first issue in December 2014. It uses the simple and funny ways to express the financial news and information, widely attracting lot of readers and successfully gaining a high market share just within few months. In August 14 2015, strategist has officially entered into online network that its website has been launched to provide real-time financial analysis, information, and the functions of Hong Kong stocks & futures quotes, in order to serve investors thoroughly.
Strategist’s broadcasting channel: https://www.facebook.com/winmoneylive/
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