Realord Group announces its 2020 FY Annual Results

Financial highlights

For the year ended 31 December

HK$ '000

2020

HK$ '000

2020

Revenue

869,341

828,898

+4.9%

Gross profit

201,103

188,115

+6.9%

Bank balances and cash

1,268,295

585,052

+116.8%

Total asset

16,719,446

12,582,947

+32.9%

Net current asset

3,060,040

2,258,421

+35.5%

Total equity

4,411,574

3,219,290

+37.0%

HONG KONG,March 23,2021 --Realord Group Holdings Limited (the "Company",together with its subsidiaries,the "Group",stock code: 1196) today announced its annual results for the year ended 31 December 2020. During the year,the Group recorded a total revenue of approximately HK$869.3 million,representing an increase of approximately 4.9% as compared to that of the last year of approximately HK$828.9 million. The Group recorded a netprofit of approximately HK$892 million while the profit attributable to owners of the Company of approximately HK$885.2 million,the basicearnings per share was HK61.55 cents.

The significant improvement in the Group's results was mainly attributable to a net gain on fair value changes of the Group's investment properties of approximately HK$2,463.4 million during FY2020. The significant amount of net gain on fair value changes of the Group's investment properties was mainly attributable to the appreciation in value of the Group's property located in Qiankeng Industrial Zone,Longhua District,Shenzhen,of which the approval in principle in respect of the proposed urban redevelopment plan thereon involving a change in land use from industrial to residential use was granted by the relevant government authority in August 2020.

Business Overview By Segment

The Property Segment

In FY2020 the revenue from the property segment recorded a gentle increase to HK$10.9 million,representing a year-on-year increase of 3.0%

The Property Segment recognized a significant growth in segment profit by nearly 28 times on a year-on-year basis,whereby a segment profit of approximately HK$2,050 million was generated in FY2020

The increase was mainly due to the overall revaluation gain of the Group's investment properties of approximately HK$2,463.4 million during FY2020. The increase in the fair value of investment properties was mainly attributable to an appreciation in value of the Qiankeng Property

Realord Villas Project:The Group targets to complete the renovation project of a shopping mall and apartment units in the third quarter of 2021. Leasing of the investment properties is underway. Signed tenants included renowned supermarket,chained convenience store,restaurant,pharmacy store,and laundry shop. Potential tenants such as big catering groups are also in talks.

Realord Technology Park:The Group has submitted the application of extension of Phase II of the Realord Technology Park to the related government authorities. Phase I of the Realord Technology Park,is planned to develop along with Phase II when the government approval is granted.

Qiankeng Property (Guan Zhang Electrical Electronic Factory – Urban Renewal Project): The redevelopment plan of Qiankeng Property,in which would be changed from industrial land use to residential use,was approved by the relevant urban renewal bureau in August 2020. The Group has been approved as the authorised developer of the project by the related government authority in January 2021. Demolition of the existing factory and infrastructures has commenced.

Laiying Garden - Urban Renewal Project:The Group was selected by relevant stakeholders as the market developer of the redevelopment of Laiying Garden. Demolition of the existing sitewill be commenced in the second half of 2021.

Zhangkengjing Property:The application of changing its land use from industrial to commercial and residential for redevelopment purpose is being reviewed by the relevant government authorities as at the reporting date. Property units are currently used for rental purpose.

The Financial Services Segment

The revenue from the Financial Services Segment reached approximately HK$82.1 million in FY2020,which was doubled from that of approximately HK$40.9 million in FY2019. The segment,which has become one of the main the main business segments that drives revenue growth,recorded an operating profit of approximately HK$6.1 million for FY2020

Realord Asia Pacific Securities Limited took an active role in the primary market in 2020,and participated in 10 IPO projects as joint bookrunner and underwriter and 9 international placing projects.

In regard of its secondary market business,there was significant growth in securities transaction volume,which has led to a favourable year-on-year growth in brokerage fees. A fourfold increase in the number of newly opened securities accounts was also recorded. Meanwhile,strengthened margin financing services has resulted in higher interest income during the reporting period.

For the asset management arm,a new investment fund was launched in the first half of 2020.

The Group will continue its efforts to expand its footprint in the Hong Kong primary and secondary markets,and to enhance the variety of investment products and geographical markets in achieving a more comprehensive portfolio in the year to come. Meanwhile,with an aim to further improve user experience and raise brand awareness,the Group is in the course of optimizing its securities trading software while expanding its sales and marketing force.

The Environment Protection (EP) Segment

During FY2020,revenue from the EP segment was approximately HK$544.1 million

The Group endeavors to broaden its sourcing network,while increase the varieties and markets of its clientele.

The Group is exploring opportunities to conduct business with certain state-owned enterprises in the PRC,and investigating the potential of markets such as Indonesia and the Philippines.

With its development strategy of expanding the scale of EP operation in Japan,the Group believes that production and processing capabilities of the operation plant in Japan would be largely enhanced with additional site area and infrastructures in place.

With the operation of its processing plant in Japan on track,the Group expects that higher and more stable sourcing and processing capacity,and greater variety of product offerings could be further achieved. The Group will also look into alternatives particularly when the pandemic recovery takes place,such as deploying additional operation points in Kyushu in Japan,and seeking suitable venue options to develop another processing plant for smelting scrap materials with an aim to further lessen operational costs and improve profitability while sustain growth of the EP business.

The Motor Vehicle Parts (MVP) Segment

The revenue of MVP Segment raised by approximately 48.8% in FY2020 to HK$159.3 million

Following its development strategy to expand the scale of its MVP business,the Group was able to secure sufficient product supplies before the COVID-19 outbreak,hence it succeeded to maintain a stable product supply to retaining old customers while attracting new customers despite the pandemic.

As the Group closely monitored the account receivables turnover,a quicker turnover rate was achieved during the COVID-19 pandemic.

The Group will continue its efforts on increasing MVP sales while maintaining the stability of its procurement network amid the challenges brought by COVID-19 pandemic.

The Commercial Printing Segment

The revenue from the Commercial Printing Segment was approximately HK$72.7 million in FY2020

The Group maintained a marginal operating profit of approximately HK$0.4 million in FY2020

Fundraising activities of small and medium-sized corporates in the capital market were affected and delayed during the COVID-19 pandemic. Number of IPO customers for the Group's Commercial Printing Segment dropped slightly which has cast certain impacts to the segment revenue and profit during the reporting period. Increasing cost control pressure from customers has also led to slimmer profit for the Commercial Printing Segment.

The Group will continue to evaluate the business segment and implement cost-controlling measures whenever necessary.

The Hangtag Segment

The revenue contribution of the Hangtag Segment to the Group was relatively minimal at approximately HK$0.2 million in FY2020

In view of the sluggish market demand and dim outlook of the Hangtag Segment,the Group will continue to assess the continuity of the business operation in the year to come.

Dr. Bryan Lin,Xiaohui,Chairman of Realord Group said that,"We believe that the relatively volatile business environment due to the prolonged pandemic will continue to affect the Group's businesses to certain extent in 2021. Nonetheless,the Group remains cautiously optimistic towards the post-pandemic rebound as a result of new and stronger initiatives to combat COVID-19 pandemic such as the emergence of vaccines and more stringent controlling measures carried out in different countries. Amidst the potential uncertainties due to the global pandemic and China-US tensions,the Group is optimistics that there are still ample development opportunities for its various business segments in 2021. The Group will continue to adopt a prudent approach in achieving steady business development while exploring suitable strategic investment opportunities with an aim to maximise the returns to its Shareholders."

About Reaload Group Holdings Limited

Realord Group Holdings Limited ("Realord Group") is a conglomerate company with diversified business layout and a constituent stock of the MSCI Hong Kong Small Cap Index,and Shenzhen-Hong Kong Stock Connect. The Group is principally engaged in investment and development; financial services include corporate financing Consulting,securities brokerage services,margin financing,asset management,wealth management,financial leasing and financial credit services,etc.; environmental protection industry,mainly metal solid waste recycling,processing and sales; auto parts distribution and sales,etc.