CHTC Fong's International Company Limited reported unaudited interim results for the six months ended 30 June 2026, showing higher sales but a swing to loss after a one-off charge linked to the deconsolidation of a subsidiary.
Revenue and Profitability • Consolidated revenue rose 14.18% year on year to HK$1.25 billion, driven by stronger contributions from both core divisions. • Gross profit increased 8.05% to HK$314.13 million; the gross margin eased to 25.2% from 26.6% on rising cost of sales. • A HK$37.15 million loss on the deconsolidation of Beijing CSCE Environmental Engineering Technology Co., Ltd. reversed operating gains, leading to a pre-tax loss of HK$14.25 million versus a HK$21.37 million profit a year earlier. • Net loss attributable to shareholders was HK$19.80 million, against a HK$16.45 million profit in 1H 2025. Basic and diluted loss per share came in at 1.80 HK cents (1H 2025: earnings of 1.49 HK cents). No interim dividend was declared.
Segment Performance 1. Dyeing & Finishing Machines – Revenue: HK$954.07 million, up 10.00% and equal to 76% of group sales. – Operating profit: HK$10.13 million, down 57.80% on softer margins and cautious downstream demand. 2. Stainless Steel Casting Products & Supply Chain – Revenue: HK$294.77 million, up 30.15%, representing 24% of group sales. – Operating profit: HK$33.54 million, up 49.45% on cost-control initiatives and customer gains.
Geographical Mix Mainland China/Hong Kong contributed HK$694.91 million, or 55.6% of total sales (1H 2025: 46.3%). Asia-Pacific ex-Greater China delivered HK$325.21 million, while Europe and the Americas generated HK$160.95 million and HK$60.87 million respectively.
Balance Sheet and Liquidity • Cash and bank balances stood at HK$237.98 million (31 Dec 2025: HK$199.25 million). • Bank and other borrowings totaled HK$1.11 billion; net debt-to-equity (gearing) ratio improved to 83% from 93% six months earlier. • Current ratio edged up to 0.44 from 0.42, reflecting net current liabilities of HK$1.39 billion. • Net cash generated from operations reached HK$93 million in the period. • Inventories climbed 5.11% to HK$445.03 million.
Key One-off and Corporate Actions • Deconsolidation of Beijing CSCE resulted in a HK$37.15 million charge. • A 25% stake in associate Yantai Yelin Textile Technology was agreed to be sold for RMB33.98 million (HK$37.25 million); completion was pending as of 30 June 2026. • Shareholders approved the potential disposal of wholly-owned PT Harvest Holdings via public tender at a base price of RMB221.48 million (HK$248.12 million); no buyer had registered by the announcement date. • A land resumption agreement for Cuicheng Road Land was sanctioned, with expected compensation of RMB308.06 million (HK$341.07 million); formal contract signing remained outstanding at period-end.
Cost and Capital Measures Management highlighted ongoing full-chain cost-reduction initiatives, tighter inventory and receivables controls, and streamlining of manpower (headcount trimmed to 1,830 from 1,850). Total staff costs were HK$267 million, representing 21% of revenue versus 23% a year earlier.
Outlook The board anticipates continued market volatility but expects policy-driven demand for intelligent, low-carbon textile manufacturing equipment to support long-term growth. Strategic priorities include expanding in Southeast Asia, Xinjiang and Belt-and-Road markets, advancing product innovation, and maintaining rigorous risk and cost management.