Galaxy Payroll Group (GLXG) Registration Filing summary

Company overview and business model

• Operates as a holding company in the BVI, with subsidiaries in Hong Kong, PRC, Taiwan, and Macau providing payroll outsourcing, employment, and consultancy services to multinational clients and HR channels.

• Payroll outsourcing includes salary computation, statutory contributions, and tax filings; employment services involve acting as employer of record for seconded employees.

• Consultancy and market research services were temporarily suspended in July 2022, with plans to resume post-IPO.

• Services are delivered both directly and via in-country partners, especially in the PRC and other Asian markets.

Financial performance and metrics

• FY2023 revenue was HK$31.5M (US$4.0M), down 33% from HK$46.9M (US$6.0M) in FY2022, mainly due to the suspension of consultancy services.

• Net income for FY2023 was HK$9.0M (US$1.1M), a 60% decrease from HK$22.6M (US$2.9M) in FY2022.

• For the six months ended Dec 31, 2023, revenue was HK$15.0M (US$1.9M) and net income HK$2.1M (US$0.3M), both lower year-over-year.

• Gross profit margin declined due to higher cost of revenues and the loss of high-margin consultancy services.

• Cash and restricted cash as of Dec 31, 2023 was HK$8.6M (US$1.1M); working capital was negative HK$3.4M (US$0.4M).

Use of proceeds and capital allocation

• IPO proceeds (estimated net $6.6M) will be allocated equally to brand promotion, recruitment, office expansion, IT enhancement, and general working capital.

• No proceeds will be received from the resale of shares by selling shareholders.

• No plans to pay cash dividends in the foreseeable future; funds will be retained for business operations and expansion.