mF International Limited Announces First Six Months of Fiscal Year 2024 Financial Results

PR Newswire · 10/16 21:00

HONG KONG, Oct. 16, 2024 /PRNewswire/ -- mF International Limited (the "Company" or "mF International") (Nasdaq: MFI), a Hong Kong-based experienced financial trading solution provider, today announced its unaudited financial results for the six months ended June 30, 2024.

Mr. Chi Weng Tam, Executive Director and Chief Executive Officer of the Company, commented, "Despite facing certain revenue challenges, we have demonstrated resilience and adaptability in our business model. Our growth in subscriptions, hosting, support, maintenance, and white-label services reflects the increasing reliance of clients on our trading platforms and the demand for flexible solutions that meet varied needs. This highlights our efforts in retaining customers and diversifying our service offerings in a challenging environment. Additionally, we continue to make substantial investments to expand our business. In May 2024, we entered into two business development and marketing consulting agreements totaling US$1.6 million with consultants in China and Malaysia, which we believe may enable future growth. With the support from these professional consulting services, we are confident in our ability to adapt, explore new opportunities, and generate additional revenue in the years ahead. Moving forward, we are committed to enhancing our technological offerings, expanding our customer base in new regions, and investing strategically in our talent and infrastructure. We believe these steps will strengthen our market position and provide a robust foundation for sustainable growth and improved financial performance. We remain confident in our robust business strategy and our resilient, diversified service portfolio, which we expect may ultimately lead to the delivery of long-term value to our shareholders."

First Six Months of Fiscal Year 2024 Financial Highlights

  • Revenue was HK$12.5 million (US$1.6 million) for the six months ended June 30, 2024, compared to HK$14.2 million for the same period last year.



  • Gross profit was HK$5.3 million (US$0.7 million) for the six months ended June 30, 2024, compared to HK$7.3 million for the same period last year.



  • Net loss was HK$5.5 million (US$0.7 million) for the six months ended June 30, 2024, compared to net income of HK$2.2 million for the same period last year.   



  • Basic and diluted loss per share was HK$0.45 (US$0.06) for the six months ended June 30, 2024, compared to basic and diluted earnings per share of HK$0.19 for the same period last year.

First Six Months of Fiscal Year 2024 Financial Results

Revenue

Revenue was HK$12.5 million (US$1.6 million) for the six months ended June 30, 2024, which decreased by 11.9% from HK$14.2 million for the same period last year, primarily because of a plunge in revenue from initial set up, installation and customization services, liquidity service and quotes/news/package subscription services, partially offset by an increase in subscriptions, hosting, support and maintenance services, and white label service.



  • Revenue from initial set up, installation and customization services was HK$1.1 million (US$0.1 million) for the six months ended June 30, 2024, which decreased by 69.8% from HK$3.7 million for the same period last year. The decrease was mainly due to the decreased demand for customization services.



  • Revenue from subscriptions was HK$5.4 million (US$0.7 million) for the six months ended June 30, 2024, which increased by 7.3% from HK$5.0 million for the same period last year. The increase in subscription revenue represented an increase in the access right to the Company's trading platforms granted to those customers to whom it had delivered the initial set up or customization of the trading platforms in the prior year.

       
  • Revenue from hosting, support and maintenance services was HK$2.3 million (US$0.3 million) for the six months ended June 30, 2024, which increased by 17.7% from HK$2.0 million for the same period last year. The increase in this revenue stream aligned with the increment in licensing revenue.



  • Revenue from liquidity services was HK$1.0 million (US$0.1 million) for the six months ended June 30, 2024, which decreased by 20.4% from HK$1.2 million for the same period last year. The decrease was mainly due to a lower transaction volume.    



  • Revenue from white label services was HK$1.5 million (US$0.2 million) for the six months ended June 30, 2024, which increased by 55.6% from HK$1.0 million for the same period last year. The increase was mainly due to the growth in the number of customers in this revenue stream.



  • Revenue from quotes/news/package subscription services was HK$1.2 million (US$0.2 million) for the six months ended June 30, 2024, which decreased by 10.4% from HK$1.3 million for the same period last year. The decrease was driven by the type of data feed service package subscribed by the customers. During the six months ended June 30, 2024, the Company's customers subscribed to the basic data feed service instead of premium service package.

Cost of Revenue

Cost of revenue was HK$7.2 million (US$0.9 million) for the six months ended June 30, 2024, which increased by 4.2% from HK$6.9 million for the same period last year, which was mainly driven by a spike in employee compensation and benefits by HK$0.9 million, partially offset by a reduction in amortization of intangible assets by HK$0.6 million.

Gross Profit

Gross profit was HK$5.3 million (US$0.7 million) for the six months ended June 30, 2024, which decreased by 27.2% from HK$7.3 million for the same period last year.

Operating Expenses

Total operating expenses were HK$11.6 million (US$1.5 million) for the six months ended June 30, 2024, increased by 147.0% from HK$4.7 million for the same period last year.



  • Selling and marketing expenses were HK$0.9 million (US$0.1 million) for the six months ended June 30, 2024, compared to HK$0.08 million for the same period last year, mainly because the Company contracted two consultants to assist it in exploring new customers and planning its business strategy, and marketing and promotional activities.  

     
  • Research and development expenses were HK$0.1 million (US$0.01 million) for the six months ended June 30, 2024, from nil for the same period last year, as the Company intends to expand its software development team's software development capacity to continue to improve existing functions and develop new functions.



  • General and administrative expenses were HK$10.6 million (US$1.4 million) for the six months ended June 30, 2024, compared to HK$4.6 million for the same period last year, because of a surge in employee compensation and benefits of HK$1.8 million, insurance expense of HK$0.4 million, legal and professional fees of HK$3.7 million and travel expenses by HK$0.1 million. During the six months ended June 30, 2024, the Company offered an appreciation bonus and compensation increase to its executives and staff. The Company also incurred additional insurance coverage cost for its directors and executives as well as audit fees, legal fees, transfer agent fees, investor relations, printing, and advisory fees subsequent to the completion of its initial public offering. Its travel expenses also increased during the six months ended June 30, 2024 as its executives travelled for conferences and business meetings.

Total Other Expense

Total other expenses, net was HK$0.1 million (US$0.02 million) for the six months ended June 30, 2024, compared to HK$0.2 million for the same period last year.

Net Income (Loss)

Net loss was HK$5.5 million (US$0.7 million) for the six months ended June 30, 2024, compared to net income of HK$2.2 million for the same period last year.

Basic and Diluted Earnings (Loss) per Share

Basic and diluted loss per share was HK$0.45 (US$0.06) for the six months ended June 30, 2024, compared to basic and diluted earnings per share of HK$0.19 for the same period last year.

Financial Condition

As of June 30, 2024, the Company had cash and restricted cash of HK$32.8 million  (US$4.2 million), compared to HK$6.8 million as of June 30, 2023.

Net cash used in operating activities was HK$17.7 million (US$2.3 million) for the six months ended June 30, 2024, compared to net cash provided by operating activities of HK$3.9 million for the same period last year.

Net cash used in investing activity was HK$3.7 million (US$0.5 million) for the six months ended June 30, 2024, compared to HK$2.1 million for the same period last year.

Net cash provided by financing activities was HK$47.5 million (US$6.1 million) for the six months ended June 30, 2024, compared to net cash used in financing activities of HK$7.0 million for the same period last year.

Exchange Rate Information

Translations of amounts from HK$ into US$ as of and for the years ended June 30, 2024 are solely for the convenience of the reader and were calculated at the noon buying rate of US$1=HK$7.8083, which was the foreign exchange rate on June 28, 2024, as published in H.10 statistical release of the United States Federal Reserve Board in its weekly release on July 1, 2024.

About mF International Limited

mF International Limited is a British Virgin Islands holding company with three operating subsidiaries in Hong Kong. The Company's principal Hong Kong subsidiary, m-FINANCE Limited ("mF," or "m-FINANCE"), is a Hong Kong-based experienced financial trading solution provider principally engaged in the development and provision of financial trading solutions via internet or platform as software as a service, or SaaS. m-FINANCE has approximately 20 years of experience providing real-time mission critical forex, bullion/commodities trading platform solutions, financial value-added services, mobile applications and financial information for brokers and institutional clients in the region. With clients located over mainland China, Hong Kong and Southeast Asia, m-FINANCE provides customers with the mF4 Trading Platform, Bridge and Plugins, CRM System, ECN System, Liquidity Solutions, Cross-platform "Broker+" Solution, Social Trading Apps and other value-added services. For more information, please visit the Company's website: https://ir.m-finance.com/.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can find many (but not all) of these statements by the use of words such as "approximates," "believes," "hopes," "views," "expects," "anticipates," "estimates," "projects," "intends," "plans," "will," "would," "should," "could," "may" or other similar words. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and other filings with the U.S. Securities and Exchange Commission.

For investor and media inquiries, please contact:

mF International Limited

Investor Relations Department

Email: ir@m-finance.net

Ascent Investor Relations LLC

Tina Xiao

Phone: +1-646-932-7242

Email: investors@ascent-ir.com

 

 

mF International Limited and Subsidiaries

Unaudited Condensed Consolidated Balance Sheets

As of December 31, 2023 and June 30, 2024







December 31, 2023





June 30, 2024





June 30, 2024







HK$





HK$





US$



Assets

























Current assets

























Cash





6,810,418







30,506,308







3,906,908



Restricted cash





-







2,340,000







299,681



Accounts receivable, net





2,579,475







1,112,573







142,486



Prepaid expenses, current





371,143







12,922,493







1,654,969



Deposits and other current assets





-







403,250







51,644



Investment at fair value





343,862







343,862







44,038



Total current assets





10,104,898







47,628,486







6,099,726





























Non-current assets

























Property and equipment, net





36,511







28,356







3,632



Intangible assets, net





15,336,589







16,584,716







2,123,986



Operating lease right-of-use assets





2,957,515







2,258,388







289,229



Prepaid expenses, non-current





-







5,594,226







716,446



Long term deposit





431,972







431,972







55,322



Deferred initial public offering ("IPO") costs





4,984,334







-







-



Total non-current assets





23,746,921







24,897,658







3,188,615





























Total assets





33,851,819







72,526,144







9,288,341





























Liabilities and Shareholders' Equity

























Current liabilities

























Accrued expenses and other payables





1,782,265







376,731







48,248



Amount due to a related party





306,110







306,110







39,203



Bank borrowings, current





3,863,852







3,923,880







502,527



Contract liabilities





4,619,690







9,489,991







1,215,372



Operating lease liabilities, current





1,392,826







1,406,045







180,071



Income tax payable





217,478







93,409







11,963



Total current liabilities





12,182,221







15,596,166







1,997,384





























Non-current liabilities

























Bank borrowings, non-current





6,062,904







4,101,554







525,281



Operating lease liabilities, non-current





1,570,307







852,343







109,159



Deferred tax liabilities, net





2,292,955







1,399,592







179,244



Total non-current liabilities





9,926,166







6,353,489







813,684





























Total liabilities





22,108,387







21,949,655







2,811,068





























COMMITMENTS AND CONTINGENCIES



















































Shareholders' equity

























Ordinary shares, authorized to issue an

unlimited number of ordinary shares of no par

value, 11,585,000 and 13,251,667 shares

issued and outstanding as of December 31,

2023 and June 30, 2024, respectively





3,900







3,900







500



Additional paid-in capital





2,042,379







46,418,547







5,950,728



Retained earnings





9,778,545







4,231,954







541,565



Accumulated other comprehensive loss





(81,392)







(77,912)







(15,520)



Total shareholders' equity





11,743,432







50,576,489







6,477,273





























Total liabilities and shareholders' equity





33,851,819







72,526,144







9,288,341



 

 

mF International Limited and Subsidiaries

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income

For the Six Months Ended June 30, 2023 and 2024







For the six months ended June 30,







2023





2024





2024







HK$





HK$





US$



Revenue





14,153,693







12,470,969







1,597,143



Cost of revenue





6,896,648







7,184,748







920,142



Gross profit





7,257,045







5,286,221







677,001





























Operating expenses

























Selling and marketing expense





79,200







918,731







117,661



Research and development expense





-







109,231







13,989



General and administrative expense





4,620,203







10,580,763







1,355,066



Total operating expenses





4,699,403







11,608,725







1,486,716



Income (loss) from operations





2,557,642







(6,322,504)







(809,715)





























Other income (expense)

























Other income (expenses), net





43,643







(18,096)







(2,318)



Realized loss on disposal of financial assets at fair value





(7,874)







-







-



Change in fair value on financial assets at fair value





(2,091)







-







-



Interest expense, net





(201,624)







(99,354)







(12,724)



Total other expense, net





(167,946)







(117,450)







(15,042)





























Income (loss) before income taxes





2,389,696







(6,439,954)







(824,757)



Income tax expense (benefit)





169,358







(893,363)







(114,412)



Net income (loss)





2,220,338







(5,546,591)







(710,345)





























Other comprehensive loss

























Foreign currency translation adjustment





(157)







3,480







(5,099)



Comprehensive income





2,220,181







(5,543,111)







(715,444)





























Weighted average shares outstanding – basic and diluted*





11,585,000







12,196,111







12,196,111





























Earnings (loss) per share – basic and diluted*





0.192







(0.45)







(0.06)



* Giving retroactive effect to the 1 for 231.7 share split effected on August 11, 2023. 

 

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SOURCE mF International Limited