BOSA Technology (8140) H2 23/24 earnings summary

Executive summary

• Revenue for the year ended 30 June 2024 decreased by 5.6% to HK$100.7 million, mainly due to lower sales of couplers and fewer new projects and customers.

• Net profit margin rose significantly from 19.5% to 34.2%, driven by a reversal of impairment loss on trade receivables.

• The Group completed 126 projects (down from 148) and secured 149 new contracts (down from 158), with recognized revenue from new contracts increasing to HK$39.1 million.

• The business environment remained challenging due to high interest rates, weak property market, and surplus inventory among developers.

Financial highlights

• Revenue: HK$100.7 million (down 5.6% year-over-year).

• Gross profit: HK$47.0 million (up 0.6% year-over-year); gross margin improved to 46.7% from 43.8%.

• Net profit: HK$34.4 million (up 65.1% year-over-year).

• Earnings per share: 4.30 HK cents (up 65.4% year-over-year).

• Cost of sales fell by 10.4% due to lower material costs and workshop closure.

• Reversal of impairment loss on trade receivables contributed HK$3.7 million to profit.

• Bank balances and time deposits totaled HK$157.9 million at year-end.

• No dividend declared for the year.

Outlook and guidance

• Construction business in Hong Kong expected to remain steady to slow in the short to medium term.

• Government infrastructure initiatives and housing policies are expected to provide long-term opportunities.

• The Group will continue to diversify its customer base and monitor costs to maintain gross margin.