China Wacan Group Company Limited (China Wacan, 01920) released its audited results for the year ended 31 December 2025.
Revenue and Profitability • Revenue increased 13.6% year on year to HK$124.95 million, driven mainly by higher Construction Services turnover and the first-time contribution of HK$8.90 million from the new Beauty & Health Services segment. • Gross profit recovered to HK$10.02 million from a gross loss of HK$12.88 million in 2024, lifting the gross margin to 8.0% from negative 11.7%. • Reversal of expected credit losses totalled HK$2.35 million versus a HK$21.51 million charge in 2024. • Administrative expenses rose 199.5% to HK$26.72 million, reflecting higher professional fees, staff costs and rental expenses. • Finance costs climbed 114.5% to HK$0.46 million due to lease-related interest. • Loss attributable to shareholders narrowed 76.7% to HK$10.09 million (loss per share: 2.93 HK cents), compared with a HK$43.34 million loss (13.89 HK cents) a year earlier.
Segment Performance • Construction Services remained the core contributor, generating HK$116.04 million revenue and HK$7.27 million segment profit. • Beauty & Health Services, launched in 2025 with 67 physical stores across major Chinese cities, reported HK$8.90 million revenue but a HK$13.96 million segment loss, reflecting start-up costs. • Construction IT Services had no revenue during the year (2024: HK$0.37 million).
Balance Sheet and Liquidity • Cash and cash equivalents increased to HK$31.12 million (2024: HK$10.54 million), while all bank borrowings were fully repaid by year-end. • Net assets rose to HK$14.20 million from HK$9.83 million. • Gearing ratio (total interest-bearing liabilities and related party loan to total equity) stood at 71.1% (2024: 54.0%), reflecting the addition of HK$2.00 million due to a related-party payable and HK$8.09 million in lease liabilities.
Capital Activities • In June 2025 the company placed 62.40 million new shares at HK$0.241 each, raising gross proceeds of HK$15.04 million; net proceeds of HK$14.10 million were fully utilised for expansion of the beauty business, office renovation and working capital. • A connected subscription agreement for 112.32 million new shares at HK$0.3965 each was approved in February 2026; completion is pending. • The authorised share capital was increased to HK$120 million (1.20 billion shares).
Operational Highlights • Order book for ongoing wet-trade projects totalled approximately HK$273.40 million at 31 December 2025; bids for five additional contracts worth about HK$152.20 million were pending. • Employee headcount expanded to 260 (2024: 13) to support the new beauty segment; total staff costs rose to HK$15.34 million (2024: HK$5.04 million).
Dividend • No final dividend was declared for 2025 (2024: nil).
Governance and Other Developments • HLB Hodgson Impey Cheng Limited was appointed as the new external auditor in December 2025, replacing Wilson & Partners CPA. • The company reported full compliance with the Corporate Governance Code and maintained the required public float throughout the year.
Outlook Management signalled a cautious stance toward Hong Kong’s construction market amid subdued developer activity, while focusing on maintaining market share in wet-trade services and accelerating the rollout of beauty and health stores across Mainland China to diversify revenue streams.
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