During the Period, the Group achieved revenue of approximately HK$538.6 million, representing an increase of approximately 16.9% as compared with the six months ended 30 June 2023 (6M2023). The gross profit increased by approximately 25.1% to approximately HK$192.5 million year-on-year. The gross profit margin increased to approximately 35.7% (6M2023: approximately 33.4%). Meanwhile, net profit also significantly increased by approximately 50.9% from approximately HK$35.8 million for 6M2023 to approximately HK$54.0 million for 6M2024. The increases in both gross profit and net profit were primarily attributable to the positive effects of better economies of scale driven by the increase in revenue from both original equipment manufacturer (“OEM”) sales and web sales, as well as the continuous enhancement in operational and production efficiency. Basic earnings per share was approximately HK10.15 cents (6M2023: approximately HK6.72 cents).

The board of directors has resolved to declare an interim dividend of HK3.0 cents per share for 6M2024 (6M2023: HK2.0 cents).

Business Review

During the Period, leveraging the consistently outstanding performance in engineering and production efficiency and quality, the Group successfully secured additional orders from its major OEM customer driven by the increasing market demand, which boosted its overall OEM sales. Meanwhile, the Group pushed forward steady business development in different product lines, which included the development of trading card game manufacturing business in the PRC. The Group’s OEM sales revenue increased by approximately 19.3% to approximately HK$438.8 million for 6M2024. (6M2023: approximately HK$367.8 million), mainly attributable to the increased demand for the Group’s tabletop game products from its major OEM customer.

In respect of web sales business, the Group continued to allocate resources to online and offline marketing initiatives including digital marketing, crowdfunding and participation in overseas exhibitions. During the Period, the Group’s web sales revenue increased by approximately 7.4% to approximately HK$99.8 million for 6M2024. The number of active registered user accounts, which refers to the registered user accounts with order(s) placed on the Group’s major websites, increased from approximately 64,100 as at the end of last year to approximately 70,400 as at 30 June 2024.

During the Period, the Group’s original brand manufacturer (“OBM”) business launched a number of card products and crowdfunding projects, which included card products published under brand licensing initiatives, progressively carving out the Group brand’s reputation and recognition in the relevant markets.

On the operational front, the new Vietnam factory officially commenced full-scale operation during the Period, and has become a key production hub of the Group, leading to a new landscape and opportunities for the Group’s overall supply chain operation and business.

Prospects

Looking ahead, the global economy is expected to continue to recover and grow in the second half of 2024, but the manufacturing industry may still face challenges amidst uncertainties such as high inflation and geopolitical volatility. The Group will continue to strive for steady business diversification and expansion as well as improvement in operational efficiency, thereby elevating its competitive advantage.

In the OEM business, the Group intends to further explore the trading card manufacturing business in USA’s and European markets, so as to seize the opportunities in both domestic and foreign markets and maximise economies of scale. In the web sales business, the Group will attempt to embark on diverse marketing campaigns that put emphasis not only on customer acquisition but also the growth of existing customers. Furthermore, Q P Market Network (“QPMN”), an e-commerce platform under the Group, has initiated collaborations with enterprises in different regions to offer online solutions for product customisation. The Group looks to promote QPMN’s services to more brands and licensors with the successful cases, making a step towards the realisation of a business-to-business-to-consumer (B2B2C) model. In terms of the OBM business, the Group will actively seek collaborations with more brands and licensors and develop additional product categories and product customisation to enrich customer experience.

On the operational front, the Group will stay focused on enhancing the efficiency and capacity of the new Vietnam plant, and continues to drive digital transformation and smart operations. The Group is in the process of preparation for the certification of Level 2i of Industry 4.0 maturity for the Dongguan plant, moving forward to achieve more extensive smart operations.

Mr. Cheng Wan Wai, Founder, Chairman and CEO of Q P Group concluded: “While the global economic landscape continues to present headwinds such as slowing growth and inflationary pressures, we remain confident in the Group’s long-term prospects. Our solid operational and financial foundations position us well to capitalise on future opportunities. We will continue to adopt a proactive and prudent management approach, pursuing steady business expansion and driving improvements in operational efficiency. By closely monitoring market changes and swiftly adapting our strategies, we will strive to minimise the impact and delivering long-term value for our stakeholders.”

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About Q P Group Holdings Limited (Stock code: 1412)

Established in Hong Kong in 1985, Q P Group is one of the leading paper-based tabletop games and greeting cards manufacturers in the PRC, with production sites in Dongguan and Heshan in Guangdong Province, the PRC, and Phu Ly City in Ha Nam Province, Vietnam. Its principal product categories include tabletop games, greeting cards, educational items and premium packaging. Since 2010, the Group has been operating web sales businesses to provide online solutions for diversified customised paper products and gift items. Currently, the number of its active registered users has reached over 70,000.

Q P Group’s major websites are:
www.makeplayingcards.com
www.boardgamesmaker.com
www.createjigsawpuzzles.com
www.printerstudio.com

Q P Market Network: www.qpmarketnetwork.com

For more information, please visit:https://www.qpp.com

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