Hong Kong, April 18, 2007 - Hantec Investment Holdings Limited ("Hantec") (HKEx: 111) today announces the most outstanding set of results since its listing on the Hong Kong Stock Exchange in 2000, with consolidated revenue amounting to HK$360 million and profit attributable to shareholders surging 93% year-on-year to HK$52 million. Basic earnings per share were HK13.29 cents, and net asset per share was HK85.91 cents.
Mr Tang Yu Lap, Chairman, Hantec Investment Holdings, said: "2006 witnessed our continued efforts in achieving growth and development on various business and geographical fronts. During the year, the Group completed the acquisition of the remaining 70% interest in Cosmos Hantec Investment (NZ) Limited ("Cosmos Hantec"). As from October 2006, Cosmos Hantec has been contributing substantially to the Group's turnover and profit with its strong asset backing and profitability. Furthermore, in May 2006 the Group set up its first North American representative office in Canada to mark a major milestone in our expansion to this continent."
Leveraged foreign exchange trading remained the major revenue contributor to the Group. Underpinned by the buoyant foreign exchange market and additional revenue resulting from increased shareholding of Cosmos Hantec, segment turnover increased to HK$135.7 million, accounting for about one third of the Group's aggregate turnover. Segment profit also increased 46.9% year-on-year to HK$26.6 million.
With gold prices remaining high, trading volume of bullion achieved satisfactory growth in 2006. Sales growth was also helped by increased customer usage of internet trading after the Group launched a new internet trading platform in the second half of 2006. Turnover of bullion trading surged 3.6 times to HK$130.2 million and segment profit increased 4.71 times to HK$32 million.
Increased trading volume of the securities market boosted the growth of Hantec's securities segment, with turnover increasing by 54.5% to HK$38 million. Commission income grew to HK$27.9 million. As a result of the increase in margin finance loans by investors, margin interest income increased to HK$8.5 million.
Trading in futures remained steady in 2006; turnover was up 6.3% to HK$17 million. During the year, the on-going revamp of the Group's existing internet trading platform and the rising general operating costs explained a slight drop in profit of this segment, to HK$1.1 million. In 2006, Hang Seng Index Futures contracts executed at the Hong Kong Futures Exchange accounted for approximately one third of the segment's turnover, while the remaining two-thirds represented futures contracts on overseas futures exchanges.
Revenue from the corporate finance segment decreased to HK$4.8 million, and this segment turned into a slight loss. In 2006, 25 assignments in corporate financial advisory services were undertaken.
The Hantec SuperFX Fund managed by the Group's asset management division, which is invested in the leveraged foreign exchange market with moderate risks, recorded net redemption for the year as investors in the foreign exchange market switched out of the fund to turn to more aggressive investment instruments. Performance of the Hantec Balanced Growth Fund, which is invested in the traditional equity market, remained steady. Aggregate revenue of asset management department (net of commission paid) decreased to HK$1.9 million, with profit before taxation declining to HK$0.2 million. Hantec Balanced Growth Fund delivered a return of 12.8% (2005: 11.53%), and annual return of Hantec SuperFX Fund was 6.11% (return from 13 July 2005 to 31 December 2005: 7.02%).
The investment consultancy and wealth management division in Hong Kong continued to co-operate with reputable international financial institutions, and developed and distributed more personal wealth management products, so as to attract more high net-worth customers. Due to an increased loss incurred in the Taiwan business, the division's loss widened to HK$5.8 million against an increased turnover of HK$24.9 million.
The Group's financial position remains strong with highly liquid assets. All the licensed corporations complied with the requirement under the Financial Resources Rule promulgated by the Securities and Futures Commission throughout the year. The Group did not have any long-term borrowings. The Group's current ratio as at the year-end was 1.71 times of its liabilities. Bank balances and cash accounted for 36% of the total assets of the Group. Subsequent to the year under review, the Group resolved to issue a three-year unsecured fixed rate loan note up to an aggregate amount of US$10 million, enabling the Group to raise long-term capital for its future business expansion.
Mr Tang concluded: "Hantec Group will maintain its base in Hong Kong, while engaging in active expansion by utilizing the additional capital financed from the issuance of loan notes, enabling us to grow from strength to strength to deliver higher returns to shareholders. Apart from tapping into the flourishing North American market, we will also seek new business opportunities in Brazil and Central Asia, as well as longer term development potential in the Middle East and Eastern Europe. In view of the robust Chinese economy and strong performance of the retail business, we are optimistic about the Group's business performance in 2007 on the backbone of our global network developed in the past few years."
Financial Highlights| 12 months ended 31 December | ||
| 2006 | 2005 | |
| HK$ '000 | HK$ '000 | |
| Turnover | 355,420 | 215,255 |
 Leveraged foreign exchange trading/broking |
135,694 | 114,362 |
| Securities broking |
38,004 | 24,579 |
| Commodities and futures broking |
17,008 | 15,986 |
| Corporate finance |
4,752 | 7,718 |
| Asset management |
1,931 | 3,185 |
| Financial planning/insurance broking |
24,933 | 21,012 |
| Precious metal contracts trading/broking |
130,247 | 28,323 |
| Unallocated revenues |
2,851 | 90 |
| Operating profit | 62,166 | 23,980 |
| Profit for the year | 52,269 | 27,063 |
| - Attributable to: | ||
| Equity holders of the Company |
52,269 | 27,447 |
| Minority interests |
- | (384) |
| Dividend per Share | ||
| - Interim | HK1.5 cents | Nil |
| - Final | HK1.5 cents | Nil |
| Earnings per Share | ||
| - Basic | HK13.29 cents | HK7.02 cents |
| - Diluted | HK13.28 cents | HK7.01 cents |
About Hantec
Hantec Investment Holdings Limited (HKEx: 111) is a multinational full-service finance house. Its holding company, Hantec Group, was founded in 1990. To meet the challenges of globalisation and increasingly diversified enterprise requirements, Hantec has expanded from its original local network - of three branches and five personal financial services centres - into strategic overseas locations by setting up representative offices in Beijing, Shanghai, Wenzhou, Luoyang, Taipei, Paris and Vancouver, as well as working closely with subsidiaries and associated companies in New Zealand, Japan, Switzerland and Taiwan. Hantec's service offerings encompass an array of personal and commercial and enterprise-related financial services. The Group has built strong synergies across its business sectors and has laid a sound foundation for the further development of its investment-banking business.