Ten Pao (1979) investor relations material

Executive summary

• Revenue for the six months ended 30 June 2026 declined 9.5% year-over-year to HK$2,666.8 million, reflecting a slowdown in market demand and cautious customer ordering.

• Gross profit dropped 16.4% to HK$440.5 million, with gross margin down to 16.5% from 17.9% a year earlier, due to higher raw material costs and RMB appreciation.

• Profit attributable to owners fell 49.1% to HK$107.7 million, and basic EPS decreased to HK10 cents from HK21 cents.

• Interim dividend of HK4.2 cents per share declared, with a scrip option, representing a payout ratio of 40.4%.

• The Group maintained stable operations and business resilience through a diversified product portfolio and global production footprint.

Financial highlights

• Revenue: HK$2,666.8 million, down 9.5% year-over-year.

• Gross profit: HK$440.5 million, down 16.4% year-over-year; gross margin at 16.5%.

• Profit before income tax: HK$123.6 million, down 51.2% year-over-year.

• Profit attributable to owners: HK$107.7 million, down 49.1% year-over-year.

• Basic EPS: HK10 cents (2025: HK21 cents).

Outlook and guidance

• Management expects a recovery in the second half of 2026 as core customer orders show signs of rebound and the period is typically a peak season.

• The Group will focus on expanding high-end smart controller business, increasing R&D in energy storage and AI-related products, and enhancing production efficiency.

• Long-term prospects remain positive, with global energy transition and AI growth expected to drive demand.