Press Release
Disposal of Commercial Printing Business Realord Concentrates Resources on Prospective Business Development in the Future
(November 13, 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 on November 10, 2017, Realord has entered into a transaction agreement with Brilliant Gold Financial Limited (“Brilliant Gold” or “Purchaser”) in which Capital Financial Press Limited (“Target”), a wholly-owned subsidiary of the Group, including its all Sale Shares with approximately $5.34 million HKD and an amount of approximately $1.5 million HKD Sale Loan owing to the Group, will be sold to Purchaser for the consideration of approximately $6.84 million HKD totally. The consideration is to be satisfied in full in cash at completion.
Target is a wholly-owned subsidiary of the Group, principally engaged in commercial printing business including graphic design, providing translation and press conference service. The consolidated net assets value of the Target as at September 30, 2017 was approximately $6.27 million HKD. The commercial printing business is the second largest business segment of the Group in 1H2017, contributing approximately 18% of the total revenue of the Group. However, due to the inflating operating costs and the intense competition, the segment profit of the commercial printing business was diminishing. Regarding the limited business prospect, the Board has decided to dispose of the commercial printing business in order to concentrate resources on other more prospective businesses. The net proceeds from the disposal will be used as general working capital and will be funding future business development opportunities of the Group.
Dr. Bryan Lin, Xiaohui, Chairman of Realord Group expresses "Disposing the commercial printing business helps the Group concentrate resources on environmental protection development and other businesses, the Group will continue in diversifying business development and seize any opportunities in promoting the Group to grow steadily and giving returns to the shareholders and investors.”
Appointment of Mr. Chan Chu Kin as the Chief Financial Officer and Company Secretary
(September 12, 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 the appointment of Mr. Chan Chu Kin (“Mr. CK Chan”) as the chief financial officer and company secretary of the Company, and also the authorised representative of the Company pursuant to Rule 3.05 of the Listing Rules with effect from 12 September 2017.
The original chief financial officer and company secretary of the Company, Mr. Chan Ying Kay (“Mr. YK Chan”), has tendered his resignation due to his other commitments. Mr. CK Chan is appointed to take up the duties. Mr. CK Chan joined the Group in June 2017 and has over 15 years of experience in accounting and finance. Mr. CK Chan is a member of both the Certified Practising Accountant Australia and the Hong Kong Institute of Certified Public Accountants.
Dr. Bryan Lin, Xiaohui, Chairman of Realord Group, expresses appreciation and gratitude to Mr. YK Chan for his contributions to the Company during his tenure of office and welcomes Mr. CK Chan on his new appointment. Dr. Lin believes that with the experience in accounting and finance of the new chief financial officer and company secretary, the Group will continue to diversify and consolidate the Group’s business, and seize market opportunities to strike for better achievement.
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Net Profit in Environmental Protection Business Recorded A Twofold Increase Realord Issues 750,000 Consideration Shares At HK$7.00
(August 31, 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 as of 31 December 2017, Realord Environmental Protection Industrial Company Limited (formerly known as Top Eagle International Trading Limited), an indirect 60%-owned subsidiary of the Company, recorded Qualified Profit of amounted to approximately HK$29,257,000, increased by 95% of the expected profit HK$15,000,000. In accordance with the terms of the Acquisition Agreement, the Company shall as part of the Consideration allot and issue 750,000 Consideration Shares to Fortune Victory Asia Corporation (“Vendor”) or its nominee(s) within 10 Business Days.
Realord Environmental Protection Industrial Company (Realord Environmental Protection) and its subsidiary Tong Bao Renewable Materials Limited are mainly engaged in recycling, dismantling and sales of scrap materials, such as copper, aluminum, iron and plastic. Their operation base is located in Wuzhou Import Renewable Resources Processing Park of Guangxi Wuzhou City where has been approved as the "urban mining" demonstration base.
According to the 2017 interim report of the Company, revenue in environmental protection business recorded HKD 141.9 million with net profit of HKD 8 million. Moreover, Realord Environmental Protection has entered in an investment agreement with Wuzhou Import Renewable Resources Processing Park Management Committee on 8 June 2017. The investment, amounted to approximately RMB 350 million, includes setting up a new processing plant for recycling and production of aluminum ingots project with a target annual production capacity of 100,000 tonnes which means the current scrap material recycling business will be 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.
According to the agreement, the Company has completed the acquisition of Realord Environmental Protection with the Sale Shares at a maximum consideration of Sale Shares of HK$60,000,000, included HK$25,000,000 in cash and as to a maximum of HK$35,000,000 by way of allotment and issuance of up to 5,000,000 Consideration Shares by the Company at the issue price of HK$7.00 per Consideration Share. In accordance with the terms of the Acquisition Agreement, the Company shall allot and issue 750,000 Consideration Shares as part of the Consideration to the Vendor with Qualified Profit of Realord Environmental Protection is equal to or more than HK$15,000,000 for the financial year ended 31 December 2016; 1,500,000 Consideration Shares Qualified Profit of Realord Environmental Protection is equal to or more than HK$35,000,000 for the financial year ending 31 December 2017 and 2,500,000 Consideration Shares Qualified Profit of Realord Environmental Protection is equal to or more than HK$50,000,000 for the financial year ending 31 December 2018. The Company is not required to allot and issue any of the corresponding amount of the Consideration Shares under the respective tranches to the Vendor with Qualified Profit of less than the Target Profit for the Relevant Financial Year.
Domestic demand for metals increased significantly with the raising price, especially in copper and aluminum. The price of Copper futures has marked a new high in past two years. It is worth noting that the State Council has issued the "13th Five-Year Plan for Eco-Environmental Protection" to encourage the development of recycling industry in December 2016, so as to cultivate recycling and comprehensive utilization enterprises through the national "urban mining" demonstration base. On 27 July 2017, the State Council promulgated the "Implementation Plan to Enhance Solid Waste Import Management System by Prohibiting the Entry of Foreign Waste", which has strengthened supervision and management of solid waste importation, curbed smuggling and illegal importation of foreign waste, and abolished the importation qualification of some enterprises who do not have capability to utilize and process the wastes by themselves. The policies would promote industrial reformation and transformation, optimize the industrial structure, and improve the excess capability of the industry.
According to "China Renewable Resources Recycling Industry Development Report 2017" released by the Ministry of Commerce, as of the end of 2016, the total quantity of recycled scrap iron, steel, non-ferrous metals and other top ten renewable resources were increased by 3.7% to 256 million tonnes. The total quantity is expected to remain increase in 2017, and the price of renewable resources will be increased.
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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.
