Neo‑Concept International Group Holdings Limited reported unaudited financial results for the six months ended June 30 2025, showing revenue of HK$60.2 million (US$7.7 million) – a 24.0% decline from HK$79.3 million in the same period last year. Net income increased to HK$2.0 million (US$0.3 million) from HK$1.4 million, while basic and diluted earnings per share rose to HK$0.50 (US$0.06) from HK$0.37 (US$0.05). Selling, general and administrative expenses grew 48.3% to HK$23.5 million, and other income fell 47.1% to HK$1.2 million. Income tax expense of HK$0.9 million (US$0.1 million) was recorded for the first time, compared with nil in the prior year.
Private‑label apparel sales dropped 51.7% to HK$32.7 million, largely attributed to U.S.–China trade policy changes that reduced demand for private‑label products. In contrast, owned‑brand retail sales surged 138.8% to HK$27.5 million, reflecting strong performance of the Les100Ciels brand and the company’s focus on expanding its own‑brand retail footprint.
The sharp rise in SG&A expenses was driven by higher payroll costs, increased legal fees, amortization related to a trademark acquired in May 2024, and additional Nasdaq listing maintenance expenses. These cost increases offset some of the margin gains from the stronger owned‑brand segment.
The recognition of a HK$0.9 million income tax expense reflects the reversal of deferred tax related to expected credit loss and depreciation allowance, a change that had no impact in the prior year. Other income declined due to reduced U.K. agency activity, which lowered the company’s agency‑fee revenue by nearly half.
Management emphasized continued investment in its integrated apparel solution model and the expansion of Les100Ciels retail locations, including a joint venture with Liwa Trading Enterprises that launched a store in Abu Dhabi on March 27 2025. The company also completed a 5‑for‑1 share consolidation effective June 16 2025 and regained Nasdaq compliance on July 1 2025. Despite these strategic moves, high debt levels and a cash‑flow‑constrained environment – reflected in an Altman Z‑Score of 2.68 – underscore ongoing financial risk.
Business implications suggest that while the company’s revenue is under pressure from trade‑policy‑driven declines in private‑label sales, the robust growth in owned‑brand retail and cost‑control measures have helped lift net income and EPS. The increase in SG&A and the new income‑tax expense highlight rising operating costs, and the company’s high leverage and cash‑flow challenges signal that continued focus on margin improvement and debt management will be critical for sustaining profitability in the near term.
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