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Financials
Final Results Announcement For The Year Ended 31 December 2024
Financials ArchiveFinal Results Announcement For The Year Ended 31 December 2024
Condensed Consolidated Statement Of Profit Or Loss And Other Comprehensive Income
For the year ended 31 December 2024
Condensed Consolidated Statement Of Financial Position
At 31 December 2024
Overall Results
For FY2024, the Group recorded a profit attributable to owners of the Company of US$1,706,000 (2023: loss of US$3,974,000) and a total comprehensive income attributable to owners of the Company of US$1,706,000 (2023: expense of US$4,040,000). Such turnaround of the Group's results is mainly attributed to (i) an increase in profit contribution from the Group's marine transportation operation to US$3,097,000 (2023: US$2,227,000); (ii) a gain on disposal of a subsidiary of US$106,000 (2023: a loss of US$2,100,000); (iii) an impairment loss reversed on a vessel of US$91,000 (2023: an impairment loss recognized on vessels of US$1,008,000); (iv) an absence of loss of a joint venture shared by the Group (2023: US$788,000); and (v) a decrease of an allowance for credit losses on debt instruments at FVTOCI to US$389,000 (2023: US$1,146,000).
Financial Review
Liquidity, financial resources and capital structure
During FY2024, the Group financed its operation mainly by cash generated from operations as well as shareholders' funds. At 31 December 2024, the Group had current assets of US$19,660,000 (2023: US$18,807,000) and liquid assets comprising bank deposits and cash and cash equivalents totalling US$18,938,000 (2023: US$17,849,000). The Group's current ratio, calculated based on current assets over current liabilities of US$1,003,000 (2023: US$1,927,000), was at a strong ratio of about 19.60 (2023: 9.76) at the year end. The significant increase in current ratio was mainly the combined effect of an increase in profit contribution from the Group's marine transportation operation to US$3,097,000 during the year, which in turn led to the increase in bank balances and the loans were fully repaid during the year, which in turn led to the decrease in borrowings.
At 31 December 2024, the equity attributable to owners of the Company amounted to US$58,804,000 (2023: US$57,098,000), increased by US$1,706,000 when compared with the last year end and was mainly a result of the profit earned by the Group of US$1,706,000 (2023: loss incurred of US$3,974,000).
The Group's borrowings represented loans from a financial institution and were fully repaid during FY2024. At 31 December 2023, such borrowings were mainly applied for financing the holding of vessels, and were all due within one year, denominated in United States dollars, bore interests at floating rates, and secured by two vessels owned by the Group.
For FY2024, the Group's finance costs of US$20,000 (2023: US$187,000) represented mainly interests for the borrowings, finance costs decreased by 89% was mainly a result of the full repayment of borrowings during the year.
At 31 December 2024, the Group's gearing ratio was zero. At 31 December 2023, such ratio, calculated on the basis of total borrowings of US$756,000 divided by total equity of US$57,098,000, was at a low ratio of about 1%.
The Group's interest income from banks increased by 27% to US$776,000 (2023: US$612,000) over last year, mainly resulted from additional surplus funds on hand.
With the amount of liquid assets on hand, the management is of the view that the Group has sufficient financial resources to meet its ongoing operational requirement.
Use of proceeds from the Open Offer
In January 2021, the Company successfully raised US$9,148,000 before expenses by way of an open offer of 548,851,784 offer shares (with aggregate nominal value of US$548,851.784) at the subscription price of HK$0.13 per offer share (the closing price of the Company's shares was HK$0.193 on the day when the subscription price was fixed) on the basis of one offer share for every one share of the Company held on the record date (the "Open Offer"). The net proceeds from the Open Offer were US$8,621,000 (equivalent to a net subscription price of approximately HK$0.12 per offer share), of which a sum of US$2,821,000 was utilised as intended to repay a bank revolving loan to achieve immediate saving in finance costs, whilst the remainder of the net proceeds of US$5,800,000 was earmarked as working capital for the Group's marine transportation business. As opposed to the original intention to apply approximately 50% of the remainder of the proceeds to its marine transportation business, approximately 40% to its investment holding business and approximately 10% to its merchandise trading business as working capital, the net proceeds from the Open Offer were not applied as working capital for the Group's merchandise trading and investment holding businesses as the Group was not active in its merchandise trading and investment activities primarily owing to the adverse economic impact brought by the prolonged continuation of the COVID pandemic. The Company had therefore earmarked the remaining net proceeds of US$5,800,000 as working capital for the Group's marine transportation business before any acquisition of a vessel is proceeded with. However, upon completion of the Acquisition of Vessel on 27 December 2024, the net proceeds of US$5,800,000 have been fully utilized.
PROSPECTS
The Group maintains a cautiously optimistic view over the prospects of marine transportation business in medium to long term. The global economic recovery, particularly the growth in emerging markets, has driven demand for bulk commodities. Transportation demand for iron ore, coal, grains, and construction materials is expected to maintain steady growth, providing momentum for the dry bulk shipping market. However, the industry also faces challenges, including geopolitical uncertainties, fuel price fluctuations, and uneven global economic recovery, which may lead to short-term volatility.
The Board is striving to explore various means in fostering diversified sources of income to minimize cyclical impact of fleet demands to enhance a sustainable long-term growth of the Group.
The Group will continue to adhere to a prudent business philosophy, focusing on cost reduction and efficiency improvement while enhancing vessel management standards. At the same time, the Group will actively address challenges, seize opportunities, and explore potential investment and acquisition opportunities, with the aim of bringing long-term benefits to shareholders.