International Housewares Retail Company (1373) H2 2024 earnings summary

Executive summary

• Revenue for FY2024 was HK$2.69 billion, down 4.9% year-over-year, reflecting normalization after pandemic-driven demand and increased outbound travel.

• Profit attributable to owners (excluding government grants) was HK$101 million, down 32% from last year, returning to pre-pandemic levels.

• Gross margin improved to 46.9% from 46.4% year-over-year, aided by product mix and supply chain initiatives.

• Total dividend per share was HK11.2 cents, with a payout ratio of 80%, down from HK22.0 cents last year.

• Cash and cash equivalents stood at HK$339 million as of April 30, 2024.

Financial highlights

• Operating profit was HK$137.4 million, down from HK$225.5 million year-over-year.

• Net margin (excluding government grants) declined to 3.7% from 5.3% year-over-year.

• Gearing ratio rose to 3.4% from 2.3% year-over-year.

• Inventory turnover increased to 98 days from 87 days year-over-year.

• Total borrowings increased to HK$22.8 million from HK$13.4 million year-over-year.

Outlook and guidance

• Focus remains on Hong Kong, Singapore, and Macau, with plans to expand store network and enhance omnichannel presence.

• Continued investment in omnichannel retail, technology, and supply chain efficiency to drive growth.

• Emphasis on OEM/private label product development, cost control, and productivity improvements.

• Store network expansion planned with net increases in all core markets over the next two years.

• Leveraging favorable exchange rates for sourcing.