Arts Optical International Holdings Limited reported unaudited revenue of HK$714.42 million for the six months ended 30 June 2026, a 20.08 % increase from HK$594.94 million a year earlier. Despite the topline expansion, the group posted a loss attributable to owners of HK$13.38 million—an improvement on the HK$15.04 million loss recorded in the prior-year period. Basic loss per share stood at 3.46 HK cents, compared with 3.89 HK cents in first-half 2025. No interim dividend was declared.

Gross profit rose 3.43 % to HK$181.14 million; however, the gross margin contracted to 25.35 % from 29.45 % due to higher production costs linked to Renminbi appreciation and a HK$5.20 million fair-value loss on investment properties. Operating loss narrowed sharply to HK$0.76 million from HK$4.25 million, while finance costs increased 21.81 % to HK$6.19 million.

Segment analysis shows: • Original Design Manufacturing (ODM) remained the core contributor, generating HK$465.68 million, up 22.80 % and representing 65 % of group revenue. Europe accounted for 48 % of ODM sales, the United States 25 %, and Asia 27 %. • Distribution revenue edged up 1.98 % to HK$147.03 million, or 21 % of total revenue, with Europe contributing 67 %. • Lens revenue surged 42.28 % to HK$101.72 million, lifting its share of group revenue to 14 %. Approximately 98 % of lens sales stemmed from Asian markets.

Operating cash inflow reached HK$86.00 million versus an outflow of HK$3.10 million in the prior year, supported by stronger sales and reduced capital expenditure. Capital spending declined to HK$17.90 million from HK$31.40 million.

At 30 June 2026, cash and bank balances were HK$158.65 million against HK$136.67 million at year-end 2025. Total bank borrowings dropped to HK$316.87 million from HK$345.15 million, lowering the debt-to-equity ratio to 55.64 % (31 December 2025: 60.56 %). Net current assets stood at HK$106.68 million, while the current ratio remained stable at 1.15.

Inventory contracted 7.47 % to HK$256.11 million, shortening inventory turnover to 88 days (1H 2025: 113 days). Trade receivables—including bills—declined 9.34 % to HK$376.46 million, resulting in a debtor turnover of 96 days (1H 2025: 94 days).

Management noted that geopolitical tensions, currency movements and elevated input costs continue to weigh on profitability, but emphasised ongoing investment in the lens division and smart eyewear initiatives as longer-term growth drivers. The board remains focused on cost discipline, flexible production allocation and prudent capital management to navigate macroeconomic volatility.