PAX Global Technology (0327) H2 2024 earnings summary

Executive summary

• Profit for 2024 was HK$721 million, down from HK$1,165 million in 2023, with revenue at HK$6,045 million, a 9.9% decrease year-over-year.

• Gross profit margin improved to 47.2% (up 260 bps), driven by RMB depreciation and favorable sales mix.

• Proposed final dividend of HK$0.25 per share, total dividend for the year at HK$0.49, up from HK$0.44.

• Net cash from operating activities rose to HK$1,163 million, highlighting strong cash generation.

• Company maintained robust performance despite global economic headwinds and cautious client spending.

Financial highlights

• Net profit margin declined to 11.9% from 17.4% year-over-year.

• Operating profit margin dropped to 14.2% from 18.7% year-over-year.

• Basic EPS fell to HK$0.669 from HK$1.075 year-over-year; diluted EPS at HK$0.658.

• Cash and cash equivalents increased to HK$3,083.6 million; no borrowings; current ratio 5.0.

• R&D costs increased 6.1% to HK$683.5 million.

Outlook and guidance

• 2025 revenue expected to decrease by 5% to 10% year-over-year.

• Gross profit margin guidance for 2025 is 45% to 47%; operating profit margin expected at 13% to 15%.

• Focus on innovation in Android smart terminals and SaaS, with increased R&D and global expansion.

• Plans to pursue strategic M&A and investment opportunities to strengthen global sales and technology.

• Company remains conservative on 2025 outlook.