Lung Fung Group Holdings (2290) investor relations material

Executive summary

• Revenue reached a record HK$3,277.2 million for FY2026, up 33.2% year-over-year, with profit for the year also at a record HK$269.1 million, up 57.9% from FY2025.

• Core net profit (non-HKFRS) was HK$300.9 million, and pro-forma core earnings per share was HK$0.60, both record highs.

• Retail network expanded from 25 to 31 stores, driving both network and same-store sales growth.

Financial highlights

• Gross profit rose 30.6% to HK$1,015.4 million; gross margin slightly decreased to 31.0% from 31.6% due to product mix.

• Operating expenses increased to HK$690.2 million (21.1% of revenue), mainly from higher selling/distribution and administrative costs.

• Bank borrowings and overdrafts decreased by HK$200.3 million to HK$556.2 million, reflecting strong cash generation.

• Net gearing ratio improved to 1,046.4% from 1,566.8% year-over-year, expected to drop further post-listing.

Outlook and guidance

• Plans to open 6–7 new stores in FY2027, focusing on major shopping districts and select residential areas.

• Continued investment in private label products, warehouse and POS system upgrades, and product innovation.

• Management expects ongoing support from tourism and government initiatives but notes evolving consumer behavior and cross-border trends as key factors.