2023-10-04 16:00Financial Performance - Total revenues for the six months ended June 30, 2023, were HK$151.3 million (US$19.4 million), a decrease of 7% from HK$163.1 million in the same period of 2022[2]. - Gross profit for the same period was HK$50 million (US$6.4 million), down 13% from HK$57.6 million in the prior year, resulting in a gross margin of 33% compared to 35.7%[2][17]. - Net loss increased by 3% to HK$69.9 million (US$9 million) for the six months ended June 30, 2023, compared to a net loss of HK$67.9 million in the same period of 2022[3]. - The net loss attributable to Graphex Group Limited for the six months ended June 30, 2023, was HK$72,117, compared to a net loss of HK$67,699 in the same period of 2022[45]. - The company reported a loss per share of HK$0.099 for the six months ended June 30, 2023, compared to HK$0.131 in the previous year[45]. Revenue Breakdown - Revenue from the Graphene Products Business decreased by 6% to HK$97.1 million, primarily due to exchange rate fluctuations, but showed a slight increase of 1% when excluding these effects[9]. - The Landscape Architecture and Design Business reported a revenue decline of 6% to HK$54.2 million, attributed to fewer new contracts[10]. Expenses and Losses - Research and development expenses increased slightly to HK$10.8 million, reflecting enhanced efforts in the Graphene products business[23]. - Selling and marketing expenses increased by 30% to approximately HK$3 million, driven by higher costs in the Landscape architecture and design business and marketing efforts in the U.S.[21]. - Total other expenses netted approximately HK$32.1 million, an increase of 2% from HK$31.4 million in the previous year, primarily due to decreased service income from the landscape segment[25]. - Graphene Products Business reported a loss before tax of approximately HK$10.7 million for the six months ended June 30, 2023, compared to a loss of HK$8.7 million for the same period in 2022, indicating an increase in loss due to decreased revenue[28]. - Landscape Architecture and Design Business experienced a loss before income tax of approximately HK$13 million for the six months ended June 30, 2023, down from HK$14 million in 2022, primarily due to exchange rate fluctuations[29]. Cash Flow and Assets - Net cash used in operating activities decreased to approximately HK$9.4 million for the six months ended June 30, 2023, from HK$12.1 million in 2022, mainly due to an increase in trade receivables in the Graphene Products Business[33]. - Total current assets increased to HK$283.8 million as of June 30, 2023, from HK$235.1 million as of December 31, 2022, driven by higher trade and notes receivables[41]. - Total liabilities increased to HK$560.4 million as of June 30, 2023, compared to HK$532.1 million as of December 31, 2022, reflecting changes in current liabilities[43]. Capital Expenditures and Financing - Capital expenditures rose to approximately HK$0.9 million for the six months ended June 30, 2023, from HK$0.2 million in 2022, primarily for equipment purchases in the Graphene Products and Landscape Architecture businesses[36]. - The company had outstanding corporate bonds of approximately HK$115.4 million and promissory notes of approximately HK$123.6 million as of June 30, 2023, unchanged from December 31, 2022[37]. - Convertible notes with a principal amount of US$20,000 were converted into shares at a conversion price of HK$0.65 in September 2023, reflecting ongoing financing activities[39]. Strategic Initiatives - The Group plans to expand production capacity significantly, with new facilities in China and the USA totaling 105,000 metric tons, potentially increasing total capacity to 215,000 metric tons[4]. - The company entered into a Cooperation Agreement with the Nanshu Town Government for the "Graphite Anode Material Project" in July 2023, indicating a strategic market expansion initiative[38]. - Graphex aims to expand its global operations to support energy transition and electrification efforts worldwide[46]. - Graphex's strategic focus is on enhancing renewable energy technologies, particularly for EV batteries and lithium-ion batteries[46]. - The company holds patents in various areas, including products, production methods, machinery design, and environmental protection, supporting its competitive position in the market[46]. Foreign Currency Impact - The company experienced a foreign currency translation adjustment loss of HK$15,747 for the six months ended June 30, 2023[45].