Shuoao International Holdings (Shuoao International) reported a turnaround to profitability for the six months ended 30 June 2026, despite a sharp contraction in top-line revenue.

Revenue dropped 48.7% year on year to HK$39.63 million, mainly as metal-trading activity paused while demand for electronic turnkey device solutions softened. Nevertheless, gross profit slid only 7.0% to HK$6.93 million as gross margin widened to 17.5% from 9.6%, reflecting tighter cost control and a richer product mix.

Selling and distribution expenses were cut 22.2% to HK$0.97 million, while administrative and other expenses fell 29.2% to HK$9.23 million. Finance costs eased 28.6% to HK$0.04 million. These efficiencies lifted operating profit to HK$2.68 million (1H25: HK$0.13 million loss), translating into a net profit of HK$2.64 million versus a HK$0.14 million loss a year earlier. Profit attributable to shareholders reached HK$1.91 million, equating to basic earnings of HK0.11 cent per share (1H25: loss of HK0.01 cent).

Segment performance diverged. The electronic turnkey device solutions arm generated HK$39.63 million in sales (-16.8% YoY) but posted a segment profit of HK$1.51 million, up sharply from HK$0.15 million, as efficiencies offset volume pressure. The metal-trading unit recorded no revenue versus HK$29.58 million a year ago and slipped to a HK$0.71 million loss amid heightened price volatility. Property development in Australia remained pre-revenue but contributed HK$0.55 million of profit, sourced mainly from site rental income.

Fair-value appreciation of the group’s 1.46% stake in Zheneng Jinjiang Environment added HK$15.34 million to other comprehensive income, while currency translation gains of HK$9.66 million lifted total comprehensive income to HK$27.64 million, up 45.6% year on year.

The balance sheet remained solid. Cash and bank balances rose 9.7% to HK$77.87 million, supporting a current ratio of 6.6 times (FY25: 6.0 times). Net current assets increased to HK$281.95 million. With no bank borrowings and lease liabilities of only HK$2.29 million, gearing stood at 0.60% (FY25: 0.97%). Inventories declined 63.0% to HK$4.57 million, while properties for sale under development in Australia expanded to HK$211.47 million.

Directors proposed no interim dividend, consistent with the prior-year stance.

Management signalled ongoing caution in metal trading, continued optimisation of the electronic components portfolio, and further engagement with Australian authorities and potential operators to advance the Canterbury Road development, which has secured key planning approvals for a healthcare-focused project.