Hong Kong-listed Pegasus International Holdings Limited (Pegasus International) reported a sharp contraction in full-year earnings for the 12 months ended 31 December 2025, as property-rental weakness and negligible footwear sales dragged performance.
Revenue and Profitability • Revenue fell 55.33% year on year to US$2.62 million (2024: US$5.87 million). • Rental income from mainland China investment properties, the core business, declined 40.27% to US$2.61 million. Footwear manufacturing sales almost vanished, dropping to US$0.01 million from US$1.50 million. • Gross profit contracted to US$1.55 million, with gross margin slipping to 59.1% from 62.1% a year earlier. • A US$4.39 million fair-value write-down on investment properties and a US$0.70 million impairment on trade receivables contributed to an operating loss. • Loss before tax widened to US$5.42 million (2024: US$1.76 million). After a US$1.10 million tax credit, net loss attributable to shareholders totalled US$4.32 million, versus a US$1.06 million loss in 2024. • Basic loss per share increased to 0.59 US cents from 0.15 US cents.
Balance-Sheet and Liquidity • Total assets stood at US$91.43 million (31 Dec 2024: US$92.49 million). • Cash and bank balances (excluding pledged deposits) were US$7.93 million, down 8.33% year on year. • Pledged bank deposits amounted to US$2.86 million, securing newly arranged bank loans of US$2.58 million at a 3% fixed rate. • Net current assets improved to US$11.48 million (2024: US$10.07 million), giving a current ratio of 5.9x (2024: 5.4x). • Total equity declined to US$73.42 million from US$76.28 million, reflecting the annual loss and other comprehensive movements.
Cost and Expense Dynamics • Total staff costs decreased 17.9% to US$1.24 million. • Selling and distribution expenses dropped to US$0.05 million (2024: US$0.27 million) following the near-cessation of footwear activities. • General and administrative expenses were largely stable at US$2.76 million. • Finance costs rose to US$0.09 million (2024: US$0.04 million) after the group added new borrowings.
Segment Update • Leasing: The Nansha industrial park, offering over 340,000 sq m of space, remained the primary revenue source. Management cited tenant caution amid geopolitical uncertainties and China’s property-market weakness as factors behind lower occupancy and a US$4.39 million fair-value decline in investment properties. • Footwear Manufacturing: Production has been temporarily suspended due to persistent global trade headwinds and tariff pressures; the board will reassess market conditions over the next 12-24 months before resumption.
Capital Expenditure and Dividends • Capex for the year totalled US$0.11 million, mainly for machinery and facility upgrades. • No final dividend was proposed, compared with a HK$0.01 payout a year earlier, as the company prioritises liquidity preservation.
Outlook Management anticipates a “severe” operating environment in 2026, citing ongoing trade protectionism and geopolitical tensions. Efforts are under way to attract high-tech tenants to the Nansha industrial park through cooperation with local authorities and industry associations. The board highlighted the group’s “very healthy” cash position and commitment to prudent financial management while seeking new growth opportunities.