Town Ray profit drops 38% despite revenue boost from cooking appliance sales

Town Ray Holdings Limited announced its interim results for the six months ended June 30, 2025, reporting an 8.4% revenue increase to HK$327.3 million, up from HK$301.9 million in the same period last year. This growth was primarily driven by increased sales of cooking appliances. Despite the revenue rise, gross profit decreased by HK$19.9 million, or 19.8%, to HK$80.8 million, leading to an 8.6 percentage point drop in gross profit margin to 24.7%. This decline was attributed to higher direct labor costs, overheads, and a strategy to offer products with lower gross profit margins.

Profit attributable to equity holders fell by HK$18.4 million, or 38.0%, to HK$30.1 million from HK$48.5 million in the prior year. The net profit margin also decreased by 6.9 percentage points to 9.2%. Other income and gains saw a HK$2.6 million reduction to HK$6.6 million, mainly due to lower bank interest income and a decrease in exchange gains. Basic earnings per share for the period were HK8.38 cents, down from HK13.52 cents in the previous year. The board declared an interim dividend of HK7.0 cents per ordinary share, totaling approximately HK$25.1 million.

The group's financial position remains stable with a gearing ratio of 7.7% and a current ratio of 1.7 times as at June 30, 2025, indicating sufficient working capital. Total interest-bearing bank borrowings decreased to HK$25.6 million from HK$40.0 million at the end of 2024. Strategic investments included the acquisition of Workshop 20B for approximately HK$7.1 million to expand its Hong Kong operations.