Analogue Holdings Limited ($1977)

[Audio Gap] a leading provider of electrical and mechanical engineering solutions and information and communications technology services for smart cities with headquarters in Hong Kong and operations in the Chinese mainland, Macau, the U.S., the U.K., Germany, Singapore and Malaysia. We provide comprehensive one-stop E&M services across diverse sectors, including building services encompassing buildings, data centers and infrastructure as well as Environmental Engineering, ICBT, which stands for information, communications and building technologies and lifts and escalators. Committed to technical excellence and research and development, we foster a culture of innovation, which has resulted in 61 international patents and designs. Throughout the years, we have successfully achieved sustainable business growth and maintained a high level of contracts in hand. We also placed great emphasis on sustainability as reflected in our ESG initiatives and our focus on creating shared value for the community. As at the 31st December 2025 we made substantial progress on different fronts. Leveraging our agility, the agility of our diverse business space, we are happy to highlight our achievement of record high contracts in hand, 113.7% increase in order intake, strong cash position and high recurring revenue streams, providing a solid foundation for our business in the coming 3 years and beyond. To continuously enhance our competitiveness, we have established leadership in the advanced construction technique of multi-trade integrated mechanical, electrical and plumbing or MiMBP in short, with the expanded MiMEP design and manufacturing center, the MiMEP high productivity with research center and other MiMEP manufacturing facilities digitally linked to our headquarters Tower to achieve real-time monitoring and seamless coordination across regions. Embracing new technology, new market and new business model as the 3 pillars of our business strategy. We have successfully ceased a variety of business opportunities to drive our business forward. Specifically, the edges we have established in advanced MiMEP, innovative technologies and comprehensive capability are instrumental in our success in winning many significant contracts across diverse sectors. Our ATAL design, research and training center serves as a timely platform for making innovation actionable, enabling technologies that benefits employees to be implemented and encouraging solutions that create value for customers. In the financial year of 2025, our associate TEI being one of the largest independent lift and escalator companies in New York continued to expand in the Southeastern part of U.S. The group also actively built on its presence in the U.K. and broadened its network across other international markets. In addition, we're exploring Asia and the Middle East for project and technical services opportunities. The lifts and escalators segment continued to advance its logically integrated business model progressively through developing additional products, strategic partnerships and further penetration into the southeastern region of the U.S., the U.K. and other international markets. Our industry leadership in the advanced construction techniques of MiMEP, DfMA which stands for design for manufacturing and assembly and BIM, which stands for building information modeling, helps address the industry pain points of labor shortages, aging workforce and rising demand for quality with transformed engineering workflows to improve quality, enhance safety, reduce site time, minimize waste and ultimately prevent site issues before they arise. In addition, the group further expand the use of advanced construction technologies, artificial intelligence and Digital Twin technologies across our operations. Smart solutions are integrated not only for buildings, but also industrial applications and mission-critical infrastructure to deliver smarter, safer and more sustainable assets. Our new intelligent headquarters, ATAL Tower became fully operational during the period. It is an investment in the future and Hong Kong that enables us to integrate all operating units under one roof to enhance synergy and efficiency. It is also a practical platform for implementing and advancing innovative technologies. ATAL Tower's digital infrastructure enables real-time coordination across MiMEP design and manufacturing center and high productivity research center in Zhuhai and real-time monitoring in Hong Kong, enhancing MiMEP adoption and stakeholder benefits. The ATAL design, research and training center in the ATAL Tower has become an active hub of bringing together customers, industry stakeholders, partners and staff to nurture ideas and co-create innovative solutions. Next, our CFO, Peter will now present our financial performance in the full year of 2025.

Thank you, Dr. Mak. Good afternoon, everyone. During the reporting period, 2025, the group's order intake was up 113% to HKD 12.9 billion. Contracts in hand hit a record high of HKD 17.9 billion, up 62% year-on-year. Revenue was HKD 6.1 billion, with profit attributable to owners of the company of HKD 167 million, approximately 24% increase year-on-year. We had bank balances and cash of around HKD 1 billion and a gearing ratio of 10%. Let's take a closer look at our key financial data. Although our revenue was lower by 5.6% year-on-year apparent to 2024, mainly due to the phasing of projects. The lower revenue in Building Services and ICBT segment was partially offset by higher revenue in Environmental Engineering and lift and escalators sectors. The gross profit margin 2025 was at 16.4%, higher than 2024, which was up 15.5%. For the full year of 2025, the profit attributable to owners of the company was HKD 167 million, representing a year-on-year increase of approximately 24% when compared with 2024. Basic earnings was HKD 0.12 per share, and the Board has declared a second interim dividend of [ HKD 0.029 ] per share. Let's have a look at the revenue breakdown. In terms of revenue breakdown by segment, our building services continue to be our main revenue contributor accounting for approximately 54% of our total revenue. Both Environmental Engineering and lift and escalators also recorded an increase in revenue in 2025. And by nature, contracting work remain the main source of our revenue. And let's have a look at the balance sheet of our group. The group's overall balance sheet remains healthy. The gearing ratio fell from 20 -- over 26% or just around 10%, and our return on equity was 7.4% for the period. Overall, the group has maintained a healthy balance sheet with a strong cash position and adequate committed buying facilities to finance our future growth and development. And let's have a look at our returning capital to shareholders. The second interim dividend for the year of 2025 is [ HKD 0.029 ] per share. We continue to reward the support of our shareholders in a stable manner. I will now hand over to Brian, who will take you through the business highlights of our Building Services segment. Brian, over to you.

Thank you, Peter. Good afternoon, everyone. The Building Services segment continues to be the largest contributor to the group's revenue. The segment achieved a record high level of contact depend, totaling [ HKD 8,000 million ] in 2025, up to 62% compared with full year 2024, providing a solid foundation for the coming 3 years and beyond. Segment revenue was HKD 3,000 million, 16% lower than in the previous year, largely due to different phasing of projects. As Dr. Mak mentioned, our lead in the advanced construction technologies of MiMEP has helped us further enhance our competitors. We developed our own MiMEP methodologies and solutions for streamline production and management. We also set up modern manufacturing facilities at the MiMEP design and manufacturing center and the MiMEP high productivity research center in Zhuhai, along with other MiMEP manufacturing sites in Hong Kong to ensure quality and facility, seamless coordination across the regions, a real-time high resolution remote monitoring system as we set up for these MiMEP facilities to be monitored from our headquarters and ATAL Tower. Our leadership in MiMEP has led to significant achievements, including securing a landmark MiMEP package, contract for a Grade A office building at in Causeway Bay, with the highest level of MiMEP application and 85% for a commercial development. Through our systematic decision-making methodologies and quality assurance technologies, we are able to ensure win-win benefits for various stakeholders and enhanced quality and productivities. With this advanced technology, we are also able to address commenting on in the traditional work culture of the local construction investment, such as tight schedule, difficult site environment and demanding work hours. Our comprehensive capability across diverse areas allows us to benefit from changing market trends in areas such as hospitals, infrastructure, data centers, public and private housing, university and commercial development, among our varied projects in this segment. We secured public housing projects that address community needs in various districts, including [indiscernible] and more projects in [indiscernible]. In terms of data centers, we secured a data center fitting out work for a major data center service provider in [indiscernible]. And as for hospitals, we award a contract to work on the expansion of buildings at a major hospital [indiscernible] and lost districts. We have also been awarded a diverse range of commercial developments, including development projects in Causeway Bay, Central, West and Bongo. On the private housing side, we secured a range of contracts, including projects in Dongchong, Jarden, Wambo and In addition, Other projects, including residents, student hostile and academic buildings at various universities and Hong Kong International Airport runway system for the modification of the North runway. Across other regions, we have also been awarded a diverse range of projects, including a commercial development project, a mega integrated construction project and podium construction project in Shanghai as well as a significant hotel project in Macau. I will now hand over to Raymond, who will present the performance of other business segment. Thank you.

Thanks. I'm going to go over the performance of 3 of our business segments, environmental Engineering, ICBT and lifts and escalators. I will start with the Environmental Engineering segment, a record high contract win level of HKD 8 billion was achieved up to 86.9%. Segment revenue reached HKD 1.6 billion in the full year of 2025, an increase of 18%. We have integrated advanced and innovative solutions including AI and able the digital train under the band of [indiscernible], doping our intelligent technologies to the market, our business development units smart data automation is applying these elites, in water, wastewater and also solid waste design and build projects as well as in the operation and maintenance of M&E to help make better operation decision, extended life cycle of plants and ensure excellent savability of environmental infrastructure and enhance operational efficiency, reliability and also safety. One of the cycle 3 projects, our Environmental Engineering segment is a record lifting value contract for relocation of starting sewage man work to Among our varied orders to sewage shipment projects include policing plant, Changzhou, suit treatment and disposal facilities and also works at Sunset 1. The selective project was the large of improvement skins in [indiscernible]. Water work treatment projects include provisioning project of starting water time works and also the water Cimineramic power plant. Landfill projects include the little treatment work for west new territory landfill extension and also new retrade treatment plant at Northeast new territory landfill extension. We are also working on testing projects such as the West new territory landfill gas our generation Phase II development projects. We also have other notable mechanical handling projects, Niti, supply and installation of laundry share base system for government shopping and finishing at laundry. And also the supply and installation of a dramatic story and transportation system for the hospital authority service center. In addition to contract words, operation and maintenance contribute to our recurring revenues, including the organic resources we covered centered at one. The food waste treatment facility at and also starting to treatment work and [indiscernible]. There are also projects in the Chinese Mainland, including waste water treatment plant in Chengdu and also combined heat and power as some high Chengdu. Our overseas projects include wastewater treatment plant at Depot and also Palacia. Turning to our ICBT segment, contact in hand were HKD 852 million. Total revenue slightly decreased by 1.5% year-on-year to RMB 630 million. Leveraging our own R&D, design and talent development, begin and intelligent building solutions offer by the ICT segment. Integrate a range of information and communications geologies. This allows us to meet the core demand for smart and stable solutions. We are also actively cooperating with leading manufacturers around the world and also the Chinese to expand our geological reach. The ICBT segment is committed to individual building, smart and connected urban environments and improving how people live, and indirect with go around them. Our telco deployment capabilities are demonstrated by the supply and installation of a variety of advanced in certitude projects, including commercial development projects in Hong Cheng and Sangha, private residence in the paint. Sector infrastructure projects are also include Hong Kong innovation and part for the supply and installation of BMS, ICBT and smart systems. -- the University of Hong Kong and also the project for the Hong Kong conversion and Exhibition Center. In addition, we work on public hospital projects, including Matas Hospital. Moving on to our lift and escalator segment. The contracts in hand was [ HKD 655 million ]. Thank you to our success in securing the renewal of a 3-year maintaining contract in Hong Kong and projects in the U.K. The total revenue grew 11% year-on-year to HKD 587 million. In Hong Kong, we provide maintaining service for a diverse range of buildings. This was our main source of profit. Our factory in Nanjing, the Chinese Mainland has a streamlined manufacturing process, cotton product or volume and also strengthened the overall product quality. Meanwhile, our associate in new light state continue to expand in the southeastern part of the U.S. That continue to build on our cases established in the United center. We have built a strong distributor network, enabling us to reach customers in over 20 countries across 6 countries. Our machine roominess life products have gained traction in the market. The diverse project we completed in Hong Kong included Hospital in [indiscernible]. West current non-corp building and also a private resident in current city. And there are joint user government office building in [indiscernible] as a stability facility include footbed area work rate and subway and also profit on in Satin. We have also extended our reach to the automatic parking system and work on projects in the joint user government office building in [indiscernible] and also revenue tower. Our diverse overseas projects, so can our successful developments in the United Kingdom, the United States assume, including the iPhone 56-story Luxe Hotel-Sky on the quarter of Times Square in New York. Our main game service cover all 4 business segments. In year 2025, the maintenance business generate strong recurring revenue of HKD 1.2 billion. This represents 20% of the group's total revenue. Some of the key contracts in Environmental Engineering segment include the contract for the maintenance of mechanical installation and main power supply and distribution equipment at the Hong Kong, Zhuhai Macau Beach. Integrated maintenance and product service for power station, a term contract to maintaining their facility in plant. A design fuel and maintenance contract for landfill gas power generation facilities for Phase 2 of the West territories &T, lentils power generation projects. and also a turn project to maintain phase one of their on-site coin generation plan for the water treatment, water departments. Other key maintenance contracts in the building service and ICBT segments include the Hong Kong Housing Authority by a number of districts, cooling tower at MTR stations and the automatic repo clearing support system at the Hong Kong Beach. Some other notable contracts in their lifts and escalator segment include the maintenance operation and maintenance of central and mid-level escalator and work way system. Maintenance of the lift and escalator system at and also Hong Kong Science Fund. And the maintenance of the lift system at a longest region headquarter and also operational based divisional police station. I will now hand over to Kin, who will present the market outlook and our growth strategies.

Thank you, Raymond. Notwithstanding the changing landscape around the world and in Hong Kong, we continuously build on our core strengths and drive innovation for quality to enable us to stay ahead in the market Distinct from our peers, we are not only a leading provider of E&M engineering solutions, but also ICBT services or smart cities. Our wide base business and comprehensive capability allow us to capture shifting priorities in diverse sectors, including hospitals, residential and commercial developments, Macau votes, data centers, universities, environmental engineering infrastructure, technology services, and lifts and escalators. Financially, our strong cash position allows us to take on additional work as appropriate and capture valuable opportunities arising in the market. On the business front, we are extending our comprehensive, vertically integrated business model of lifts and escalators with more products and partners as well as expansion into the southeastern part of the U.S. Additionally, the new maintenance contracts for housing programs, environmental projects and lifts and escalators will contribute to our recurring maintenance revenue. We will continue to drive innovation to enable the group to lead in emerging market segments and to meet evolving market demands. In particular, we have established a lead in the advanced construction technology of MiMEP, EFMA and BIM with our own methodology to create distinctive customer value and help transform the industry. We're also integrating cutting-edge technologies throughout the entire project cycle to deliver smarter, safer and sustainable infrastructure. We shall also nurture and develop talent to boost our productivity and competitiveness. The group strategy is to capture the valuable business opportunities in our multiple markets. Hong Kong's construction industry is expected to see government capital works worth HKD 90 billion to HKD 120 billion. We will continue to stay agile for opportunities across our wide business space, including health care, education, the northern metropolis that is being expedited, the need to refresh, improve and extend the life cycle of assets and ongoing operations and maintenance. We will, at the same time, increase our competitiveness with advanced construction technologies and position the group for providing services to facilitate the adoption of AI and other smart city developments. Our strong cash positions allow us to take on additional work as appropriate. The Chinese Mainland continues to show resilience and adaptability, achieving technological breakthroughs, maintaining GDP growth and continuing with reform and supportive policies. We have undertaken integration of resource deployment including project teams, design capabilities and manufacturing assets between buildings and health care and infrastructure across regions. Such cross-unit and cross-border coordination of resources and expertise enables us to respond more effectively to market demands and accelerate project delivery. With the intelligent infrastructure, ATAL Tower is linked to our facilities in the Chinese Mainland and Hong Kong for seamless integration and quality assurance across regions, strategically positioning us for the Bricker Bay area. Overseas, we are continuing to expand in the southeastern part of the U.S. and to build on our expanded operations in the United Kingdom. Leveraging our foundation in these markets, we will continue to pursue projects and technical services opportunities in Europe, Asia and the Middle East, while also looking for synergistic partnership opportunities to enhance our local and global market position and exploring the possibility of broadening our overseas market offering, beyond lifts and escalators to include engineering services. That concludes our presentation. I will now hand over to our MC for the Q&A session. Thank you very much.

Thank you, management, for the presentation. [Operator Instructions] We have the first question from Hana [indiscernible]. The government will inject an additional HKD 30 billion into public work projects over the next 2 to 3 years. Does the group have information on the allocation of this budget and will the group be able to seize relevant opportunities. That's my first questions.

Thank you very much for the question. The additional HKD 30 billion announced will boost the already strong government capital works program to about $120 billion. Now the government strategy is to be infrastructure-led and also to invest in innovation, education, housing, et cetera. Now these various segments align closely with the capability of the group and we're confident that we'll be in a strong position to capture these emerging opportunities.

We have a question from Stephen Wong from Maiden Investment. Let me unmute you. Steven, you may try to say words to see if we hear you. Stephen, it seems like your microphone is not working. Perhaps, you can tap in the questions and then we can help you announce that afterwards. We have another question -- follow-up question from Hana. With the government's recent initiative to accelerate the process for large-scale private development projects within the Northern metropolis, does the group anticipate any potential benefits or business opportunities arising from these policy measures? If so, which particular projects are you eyeing on? And how are the margins?

Thank you for your question. Let me answer. The Loveton metropolis is one of the most significant long-term development engines in Hong Kong, creating strong demand and also including infrastructure, housing, university, data center and also advanced industrial facility, M&U, et cetera. With our solid track record across building surface governmental, engineering, ICBT and lift and escalator segments, we are in a strong position to capture merchant opportunities. We will focus and elevate each opportunity carefully for [indiscernible] in fact, we already secured build environmental projects that address community needs and all the northern metropolis, including the sewage and flat water projects in and also [indiscernible]. In the coming years, there would be more infrastructure projects.

Thank you, management. We have Stephen would like to see Mike, Yes, you're unmute. Stephen, can you try? We can't hear you. Or you can type in your questions. And then -- okay. So yes, we'll wait for a question while you're typing and we'll go for another question first. This is a question from Jeffrey. Following the [indiscernible], the government has accelerated size safety regulations. What measures will the group employment to achieve cost effectiveness while maintaining safety and standard of materials?

Okay. Let me take this question. Thank you for your question. Okay. In fact, during project planning, we have continued to ensure a realistic cost estimation and sign During the project execution the expanding of as I mentioned about MiMEP can include material utilization and safety. And in fact, we are continuously enhancing the risk management framework across all sales. This includes tightening monitoring of our subcontractor performance enhanced safety, training and systems, technology integration for our safety management and regular review and object to ensure component with safety too. Thank you.

Okay. So this is the first question from Stephen, given the government is becoming more budget conscious nowadays and there are many mainland players trying to compete with price. Do we expect to see margin pressures in the next few years? That's the first question.

Let me take this question and then maybe others can supplement. Now our margin has been around 14% to 16% consistently. Obviously, there are competition, but we have been enhancing our competitiveness continuously on a number of fronts, firstly, through our comprehensive capability, secondly, through advancing construction techniques that improves the use of labor, the use of material and also the reduction of site work time. So we also developed our different in emerging markets from digital technology to overseas markets. So we will continue to work on competitiveness and assure that our business margin is sustainable.

The next question from Stephen is, what is our plan for our ownership in Nanjing Are we still going to dispose them?

Yes, this -- okay. As you probably all noticed that just very recently, a day or 2 agoa, we made an announcement in the Shanghai we successfully disposed 0.7% of shareholdings in that We will continue to dispose what we have announced back in January 2026. There are still 2.3% of the shareholdings that we have been authorized approved by the Shanghai Stock Exchange to dispose. So we will continue to do that, and then we would still in discussions with interested party regarding to the remaining shareholding of Nanjing Canasa.

We have the third question from Stephen. We have a net cash of HKD 800 million plus now, which is around 65% of our market cap now. Is there a possibility that we can improve shareholders' return by share buyback and increasing dividend payout as DTS in the past 2 years -- in the past 3 years, the DTS in the past few years were much lower than that we saw 3 to 5 years ago?

Okay. Again, let me try to answer that and -- so I think here is that our cash balance on hands of the group is about HKD 1 billion -- just over HKD 1 billion. If we break that down into what's available in each of the area, there's about HKD 250 million of that is actually in Macau and in Mainland China, supporting our businesses in those regions as well as there's about HKD 100 million that's controlled by our joint operations and JVs in our various project. So roughly, there are only really HKD 650 million is in Hong Kong, which is to support our working capital in our group. So taking into account all of that, the Board has then reviewed the requirements for working capital bearing in mind that we have now on hand -- contract on hand is a historical high. So the working capital requirement will continue to increase. So we look at that and also looking at possible investment opportunities as well as other opportunities. So we will continue to look at how to make sure that we return the capital to our shareholders, but continue to support our business growing going forward.

The following question is also from Stephen. Given we have disposed and now we have a lot more net cash, possibly equivalent to 100% of our market, shall we consider to pay a special dividend in view of the disposal?

Okay. Let me try is that we will continue to look at the Canatal shareholding and crystalize our investments from many years ago. And we will continue to look at the cash position and the financial resources of the group to decide -- the Board then will decide whether there are sufficient resources for our own development and investment, and then we can then with the appropriate decision regarding the surplus resources, whether it's share buyback or dividend, et cetera, that's usually being discussed in our board meeting.

[Operator Instructions] Stephen, do you want to try again to to mute yourself. Do you have any further questions.

No, I don't have questions.

Now it works, now work.

Yes. I mean I take my -- as a shareholder, I mean and also [indiscernible]. I think our -- like our opinion is just we hope to see a slightly improvement in the shareholder return, especially if the Canatal shares are some excess cash, which we didn't need it for our business before. If so, then yes, I think it would be great that we can improve the payout and maybe that will be better our stock prices better reflect our true the value as well.

Thank you. Thank you.

As there is no further questions, this concludes our investor presentation today. Thank you for your continued support to Analogue. If you would like to have a separate meeting with the management, these contact S BRG for coordination. Once again, thanks for your participation today. You may now disconnect.

Thank you very much.

Thank you.