Financials
CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE SECOND HALF YEAR AND FULL YEAR ENDED 31 MARCH 2025
Financials Archive
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Condensed interim financial statements For the second half year and full year ended 31 March 2025
Condensed interim consolidated statement of profit or loss and other comprehensive income for the second half year and full year ended 31 March 2025
Condensed interim statements of financial position as at 31 March 2025
Review of Income Statement of the Group
Second Half FY2025 ("2H FY2025") vs Second Half FY2024 ("2H FY2024")
Revenue
Group revenue increased by 34.5% to RMB416.5 million in 2H FY2025 as compared to RMB309.7 million in 2H FY2024.
The increase is attributed to higher revenue from tower cranes and components, rising by RMB103.8 million from RMB177.9 million in 2H FY2024 to RMB281.7 million in 2H FY2025, driven by demand for mega-size tower cranes in the energy sector. Rental and service income slightly increased of RMB3.0 million to RMB134.7 million in 2H FY2025 from RMB131.7 million in 2H FY2024.
Revenue in the PRC increased by RMB103.7 million, reaching RMB226.3 million in 2H FY2025. This growth was driven by stronger demand for mega-size tower cranes in the energy sector and a lower base in 2H FY2024, when the domestic economy was sluggish due to the ongoing property market slowdown. Revenue in the Middle East and other regions rose by RMB25.5 million, primarily due to the recognition of revenue from the lapses of options to sell back.
However, the increase was partly offset by a decline in revenue from Asia (outside the PRC), which dropped by RMB9.6 million, from RMB136.7 million in 2H FY2024 to RMB127.1 million in 2H FY2025. Revenue from the USA & Europe also decreased by RMB12.8 million as compared to period over period.
Overall, sales in PRC contributed 54.3% of the Group revenue in 2H FY2025, whilst Asia (outside the PRC), the Middle East and others and the USA & Europe contributed 30.5%, 12.0% and 3.1% & respectively.
Gross profit and gross profit margin
In line with higher revenue, gross profit increased by 40.0% to RMB112.3 million in 2H FY2025 from RMB80.2 million in 2H FY2024.
Gross profit margin increased to 27.0% in 2H FY2025 from 25.9% in 2H FY2024.
The higher gross profit margin in 2H FY2025 is primarily due to a higher sales of more mega sized tower cranes of higher lifting capacity which generates higher margin.
Other income
Other income decreased by RMB3.6 million to RMB3.3 million in 2H FY2025 as compared to RMB7.0 million in 2H FY2024. The decrease is mainly due to lower compensation income and lower interest income. The compensation income of RMB2.8 million received in 2H FY2024 from the Hongkong authority for the partial relocation of the Hongkong yard office.
Operating income/expenses
Total operating expenses increased by 26.3% to RMB107.4 million in 2H FY2025 as compared to RMB85.0 million in 2H FY2024.
Distribution costs rose by 8.0% to RMB52.8 million in 2H FY2025, compared to RMB48.9 million in 2H FY2024, primarily due to higher freight costs, which align with the increase in revenue. The increase was partially offset by lower employee costs as lower provision for bonus.
Administrative expenses increased by 53.2% to RMB50.7 million in 2H FY2025 as compared to RMB33.1 million in 2H FY2024. The increase is mainly due to higher employee costs due to the low base in 2H FY2024, attributed to reversal of bonuses.
Other operating income/expenses reported a credit balance of RMB7.6 in 2H FY2025 as compared to RMB5.3 million in 2H FY2024. The difference was mainly due to higher exchange gain of RMB10.0 million in 2H FY2025 as compared to 2H FY2024. The increase was partially offset reversal of provision of doubtful debts of RMB7.7 million in 2H FY2024 against a provision of RMB0.6 million in 2H FY2025.
The exchange gain for 2H FY2025 arose mainly from the strengthening of USD, HKD and SGD against RMB.
Finance costs increased by 38.8% to RMB11.5 million in 2H FY2025 as compared to RMB8.3 million in 2H FY2024 due to higher average borrowings.
Taxation
Income tax expense reported a credit balance of RMB12.1 million despite a profit of RMB8.3 million in 2H FY2025. The debit balance was mainly due to write back of deferred tax liability and recognition of unabsorbed tax losses previously not recognised in one of the PRC subsidiaries.
In additions, the Company historically recognized deferred tax liabilities on withholding tax levied on dividends of undistributed earnings of PRC subsidiaries. During the year, the Group had determined a portion of the profits from the subsidiaries would not be distributed in the foreseeable future due to the business operation needs of the subsidiaries. Accordingly, RMB9,525,000 of deferred tax liability had been written back.
Other comprehensive (expenses)/income
The Group reported other comprehensive expense of RMB15.0 million in 2H FY2025 as compared to RMB17.8 million in 2H FY2024. Other comprehensive expense pertains to fair value loss of RMB19.4 million from financial assets, FVOCI. The gain loss partly offset by gain on exchange translation of RMB4.5 million arose from translation of the net assets of our Hong Kong and Singapore subsidiaries.
Profit before taxation and net profit attributable to equity holders of the Company
As a result of the above, the Group recorded a profit before taxation of RMB8.3 million in 2H FY2025.
Net profit attributable to equity holders of the Company amounts to RMB22.3 million in 2H FY2025 increased from RMB2.8 million in 2H FY2024.
Full Year FY2025 ("FY2025") vs Full Year FY2024 ("FY2024")
Revenue
Group revenue increased by 11.3% to RMB880.3 million in FY2025 as compared to RMB790.8 million in FY2024.
The increase is due to higher revenue from sales of tower cranes and components of RMB93.4 million from RMB517.0 million in FY2024 to RMB610.0 million in FY2025. The increase was partly offset by lower rental and service income of RMB4.0 million to RMB269.8 million in FY2025 from RMB273.8 million in FY2024.
Revenue in the PRC increased by RMB69.8 million to RMB382.8 million in FY2025. This growth was driven by stronger demand for mega-size tower cranes in the energy sector and a low base in FY2024, when the domestic economy was sluggish due to the ongoing property market slowdown. Revenue in the Middle East and other regions rose by RMB23.1 million, primarily due to the recognition of revenue from the lapses of options to sell back. Revenue in Asia (outside the PRC) increased by RMB9.2 million. The increase is partly offset by lower revenue from Europe & the USA of RMB12.6 million.
Overall, sales in the PRC and Asia (outside the PRC) contributed to 43.5% (FY2024: 39.6%) and 36.7% (FY2024: 39.7%) respectively of the Group revenue in FY2025.
Gross profit and gross profit margin
In line with higher revenue, gross profit increased by 10.7% to RMB253.4 million in FY2025 from RMB228.9 million in FY2024.
Average gross profit margin decreased slightly of 28.8% in FY2025 from 28.9% in FY2024.
The lower gross profit margin in FY2025 is primarily due to a reduced proportion of rental and service income, which typically generates higher sales margins.
Other income
Other income decreased by RMB2.4 million to RMB8.8 million in FY2025 as compared to RMB11.1 million in FY2024. The decrease is mainly due to lower interest income of RMB1.8 million and one off compensation income of RMB2.8 million in FY2024. It is partly offset by higher government subsidies and rebates of RMB1.8 million which were received from the PRC authorities.
Operating expenses
Total operating expenses increased 31.1% to RMB236.6 million in FY2025 as compared to RMB180.5 million in FY2024.
Distribution costs increased 21.2% to RMB109.2 million in FY2025 as compared to RMB90.1 million in FY2024 mainly arose from freight cost. The increase is due to higher freight rate. The increase was partially offset by lower employee costs as lower provision for bonus.
Administrative expenses increased by 19.0% to RMB90.2 million in FY2025 as compared to RMB75.8 million in FY2024. The increase is mainly due to higher employee costs, attributed to low provision for bonuses in FY2024.
Other operating income/expenses reported a debit balance of RMB15.4 million in FY2025 as compared to a credit balance of RMB2.0 million in FY2024. The differences was due to:
- a debt written off of RMB5.5 million in FY2025 owing from Yongmao Machinery (Cambodia) Co., Ltd ("YMC"), subsequent to the full disposal of its interest;
- expected credit loss of RMB9.8 million was provided in FY2025 as compared to a reversal of RMB0.2 million in FY2025; and
- Lower exchange gain of RMB0.9 million in FY2025 as compared to FY2024.
The exchange gain for FY2025 arose mainly from the strengthening of USD, HKD and SGD against RMB.
Finance costs increased by 31.8% to RMB21.8 million in FY2025 as compared to RMB16.5 million in FY2024 due to higher average borrowings.
Taxation
Income tax expense reported a credit balance of RMB5.4 million despite a profit of RMB29.7 million in FY2025. The debit balance was mainly due to write back of deferred tax liability and recognition of unabsorbed tax losses previously not recognised in one of the PRC subsidiaries.
The Company historically recognized deferred tax liabilities on withholding tax levied on dividends of undistributed earnings of PRC subsidiaries. During the year, the Group had determined a portion of the profits from the subsidiaries would not be distributed in the foreseeable future due to the business operation needs of the subsidiaries. Accordingly, RMB9,525,000 of deferred tax liability had been written back.
Other comprehensive income/(expenses)
The Group reported other comprehensive income of RMB11.9 million in FY2025 as compared to other comprehensive expenses of RMB12.9 million in FY2024. Other comprehensive income pertains to fair value gain of RMB9.3 million from financial assets, FVOCI and gain on exchange translation of RMB2.6 million arose from translation of the net assets of our Hong Kong and Singapore subsidiaries.
Profit before taxation and net profit attributable to equity holders of the Company
As a result of the above, the Group recorded a lower profit before taxation of RMB29.7 million in FY2025 as compared to RMB59.6 million in FY2024.
Net profit attributable to equity holders of the Company amounts to RMB33.2 million in FY2025 decreased from RMB43.0 million in FY2024.
Review of Financial Position of the Group
Non-current Assets
Non-current assets increased by RMB242.3 million to RMB1,083.5 million as at 31 March 2025 mainly due to higher property, plant and equipment, non-current trade receivables and higher financial assets, at FVOCI.
The Group's net carrying amount of property, plant, and equipment rose by RMB168.9 million, primarily due to the expansion of rental fleets, capital expenditures on construction-in-progress (related to the new Hong Kong yard), and the recognition of RMB79.5 million in right-of-use assets from the new Hong Kong yard lease. This increase was partially offset by net depreciation expenses and asset disposals.
During the year, the Group allows certain customers with appropriate credit standing to make payments in instalments, typically with repayment periods ranging from 24 to 60 months. Instalment payments due beyond one year are discounted at a rate comparable to the Company's average financing rate. Amounts receivable more than one year after the reporting date are classified as non-current.
Deferred tax assets arose mainly from provisions and elimination of unrealised profits in intragroup sales and the various provisions made.
Financial assets, at FVOCI increased with fair value gain of RMB9.3 million as at 31 March 2025.
Current Assets
Current assets decreased by RMB57.2 million to RMB1,165.0 million as at 31 March 2025 mainly due to lower trade and other receivables and lower inventories (see Note on Cash Flow Statement below), partly offset by higher cash and cash equivalents.
Trade and other receivables decreased by RMB35.8 million to RMB556.0 million as at 31 March 2025. While the Group's revenue showed a modest year-on-year increase, the decrease in the trade and other receivables (current) is due to the extension of credit period resulting in the increase in trade and other receivables (non-current) as explained above.
Inventories decreased by RMB54.2 million to RMB354.6 million as at 31 March 2025 as compared to RMB408.7 million as at 31 March 2024. This lower inventory mainly due to the fulfilment of deliveries in the period under review.
Non-current Liabilities
Non-current liabilities increased to RMB177.2 million as at 31 March 2025 from RMB74.8 million as at 31 March 2024. The increase was due to higher borrowings of RMB53.3 million and increase in leased liabilities of RMB74.5 million in relates to the new rental of yard in Hong Kong for a period of 10 years.
Deferred tax provision was mainly made for withholding tax levied on dividends of undistributed earnings of PRC subsidiaries, accelerated tax depreciation on inter-company sales of tower cranes used as rental fleet.
The Company historically recognized deferred tax liabilities on withholding tax levied on dividends of undistributed earnings of PRC subsidiaries. During the year, the Group had determined a portion of the profits from the subsidiaries would not be distributed in the foreseeable future due to the business operation needs of the subsidiaries. Accordingly, RMB9,525,000 of deferred tax liability had been written back.
Current Liabilities
Current liabilities increased by RMB48.2 million to RMB1,050.4 million as at 31 March 2025 as compared to RMB1,002.2 million as at 31 March 2024 mainly due to higher borrowings and higher interest bearing loan from a corporate shareholder of a subsidiary, partly offset by lower trade and other payables.
Total Equity
As at 31 March 2025, the Group's total equity amounted to RMB1,020.9 million. The increase was mainly due to total comprehensive income of RMB47.1 million, partly offset by dividends paid in the year under review.
Review of Cash Flow Statement
2H FY2025 vs 2H FY2024
The Group reported a net increase in cash and cash equivalents amounting to RMB22.9 million in 2H FY2025 mainly due to:
- Net cash used in operating activities of RMB13.8 million resulted from decrease in operating payables, increase in inventories and interest and taxes paid, partly offset by net operating profit before working capital changes and decrease in operating receivables.
- Net cash used in investing activities of RMB17.6 million from acquisition of property, plant and equipment, partly offset by proceeds from disposal of property, plant and equipment and interest received; and
- Net cash generated from financing activities of RMB54.3 million mainly from net proceed from borrowings, partly offset by net repayment of bank borrowings and leased liabilities, interest paid, and higher restricted bank balances.
Full Year FY2025 ("FY2025") vs Full Year FY2024 ("FY2024")
The Group reported a net decrease in cash and cash equivalents amounting to RMB10.1 million in FY2025 mainly due to:
- Net cash used in operating activities of RMB60.8 million resulted from increase in operating receivables and inventories, and interest and taxes paid, offset by operating profit before working capital changes.
- Net cash used in investing activities of RMB20.8 million from acquisition of property, plant and equipment, partly offset by interested received and proceeds from disposal of property, plant and equipment; and
- Net cash generated from financing activities of RMB71.5 million mainly from net proceed from borrowings, principal portion of hire purchase, loan from a corporate shareholder of a subsidiary, cash injection by non-controlling interest and repayment from a related party, partly offset by net repayment of bank borrowings and leased liabilities, dividend paid, interest paid, and higher restricted bank balances.
Commentary
China's GDP expanded by 5.2% in 2024, aligning closely with the government's growth target. While fourth-quarter performance remained steady at 5.3% year-on-year, early 2025 has seen a modest easing, with Q1 growth at 5.0%. However, China's economy is expected to slow down in 2025, facing major challenges like weak consumer demand, a struggling real estate market, high debt levels, and trade tensions with the US, which could further dampen economic activity.
The tower crane market is intensely competitive, with both local manufacturers and international companies competing for market share. Within China, the construction sector is facing a slowdown, especially in the real estate market, which has traditionally been a major source of demand for tower cranes. Although government-driven infrastructure projects, including transportation networks and renewable energy initiatives, continue to offer some support, overall construction activity growth is expected to remain modest.
The Group expects the operating environment to be challenging. The Group remains vigilant and committed to exercising cost discipline and will take necessary remedial actions, where possible.
As announced by the Company on 8 September 2023, 13 March 2024, 22 March 2024, 3 April 2024, 2 May 2024, 1 August 2024, 20 November 2024, 1 April 20025 and 28 April 2025, there have been no material developments concerning the tower crane accident in Hong Kong involving the Company's 60%-owned subsidiary, Yongmao Machinery (H.K.) Company Limited ("YMHK"), YMHK's wholly-owned subsidiary, Eastime Engineering Limited ("EEL"), and EEL's project manager. This includes the cases related to the Relevant Summonses issued by the Labour Department ("LD Summonses") and the Building Department ("BD Summonses"). The Company will provide further updates if there are any material developments.