Good afternoon, ladies and gentlemen. Thank you for joining us today for Vitasoy's annual results briefing for FY 2025 and 2026. Before we start, I would like to introduce you to the senior management of Vitasoy Group. Sitting in the middle of the head table, we have Mr. Winston Lo, Executive Chairman of Vitasoy Group.
Good afternoon.
On the right-hand side of Mr. Lo, we have Ms. May Lo, Deputy Chairman. On Mr. Lo's left-hand side, we have Mr. Roberto Guidetti, our Group CEO. Last but not least, we have Ms. Ian Ng, Group CFO. In the following presentation, we'll first have Ian provide us with a review of the company's financial performance, followed by Roberto's presentations on the business review of different markets and the outlook. We'll then have a Q&A session. Let's invite Ian to speak to us. Ian, please.
Thank you, Angela. Good afternoon, ladies and gentlemen. Welcome to our annual results announcement briefing. Before we start off our presentation, I would like to draw your attention to this disclaimer regarding the forward-looking statement in this presentation. Let me go through the full year financial performance with you.
Group revenue was HKD 6.1 billion, declined by 3% as compared with last financial year, mainly attributable to the soft market condition in Chinese Mainland and Hong Kong operations, specifically the Macau SAR and Vitaland business. Gross profit margins slightly decreased by 0.3 percentage point to 51%, mainly due to higher trade promotional expenses and lower prices. The pressure on the margin was partially mitigated by more efficient manufacturing operations, the impact of favorable foreign exchange movement, and lower raw material costs.
Profit from operations grew significantly by 18% to HKD 430 million, while EBITDA increased by 6%. The improvement was driven by the gain from asset disposal in Chinese Mainland and effective operating cost, partially offset by the impairment charge in Australia. Profit attributable to equity shareholders of the company increased by 17% to HKD 274 million. As mentioned earlier, this year's profit from operations included the following two special items. First, we recorded a net gain of HKD 151 million from the disposal of land and building held by our Shanghai subsidiary. This transaction was part of the urban village renovation project initiated by the Songjiang District government.
The Shanghai plant had been under suspension since April 2024, and this disposal has improved asset utilization and plant efficiency by consolidating more production at our Dongguan factory. We were also able to realize cash from this idle asset and further enhance our cash position. Second, we recorded an impairment charge of HKD 98 million on the property, plant, and equipment in Australia. After three years of performance challenges, we have taken an impairment charge to align the business unit's carrying value with current market conditions.
This non-cash adjustment effectively strengthens our balance sheet and establishes a healthier foundation for the Australia business to improve financial performance and sustainable growth going forward. Excluding the impact of the above two items, adjusted profit from operations increased by 4% to HKD 377 million. Adjusted EBITDA was almost flat to last year at HKD 832 million. Adjusted profit attributable to shareholders decreased by 4% to HKD 225 million, primarily due to higher income tax expenses.
Revenue and gross profit were challenged during the first half of the financial year. We were able to improve performance on these two items in the second half. Excluding the asset disposal in Chinese Mainland and the impairment charge in Australia in the second half of the financial year, adjusted profit from operations and EBITDA improved by 21% and 4%, respectively. Earnings per share was HKD 0.263, increased by 20% comparing to last year. Next, let's move on to CapEx. Capital spending for the period was HKD 172 million. The financial position of the group remains strong. As of March 31st, 2026, cash on hand was HKD 1.2 billion.
Gearing ratio decreased to 17%. Excluding lease liabilities, gearing ratio remained at 10%. The group's return on capital employed increased to 27%. Based on the financial performance, the strong cash position, and the policy of maintaining stable dividend payout ratio, we recommend a final dividend of HKD 0.135 per ordinary share, which reflects the net gain from the asset disposal. Including interim dividend of HKD 0.04 per share, total dividend for the financial year was HKD 0.175 per share. This ends the first section of the presentation. I would like to invite our Group CEO, Mr. Roberto Guidetti, to share with you the by-market review and talk about the outlook of the group's business. Thank you.
Thank you, Ian. Let me now share with you the review of our business overall and then by geography. In summary, we had a challenging first half, and this first half affected the full fiscal year results despite a much stronger second half. In Chinese Mainland, Vitasoy brand grew market share of the soy category over the last 12 months, while VITA Tea stabilized its position in the ready-to-drink tea market. This was also driven by our progress in omni-channel, mitigating category consumption decline in the traditional trade. We have renewed the Chinese Mainland sales function leadership team with much stronger leaders in both regions and headquarter.
This enhances our ability to leverage effectively the new brand campaigns and product innovation to accelerate in the fiscal year 2026- 2027. There are some special items that Ian mentioned that have been included in the full-year results. First, we recorded a net gain of HKD 151 million from the disposal of land and buildings held by Vitasoy Shanghai Company Limited to the Chinese Mainland government, as mentioned earlier. Second, we recorded a property, plant, and equipment impairment charge of HKD 98 million in Australia.
With the impairment behind us, we anticipate an improvement in asset utilization, and the Australia business will be on the right path of profitability improvement. The impairment was non-cash and had no impact on the cash position and cash flow of the company. The group revenue for financial year 2025, 2026 decreased by 3% to HKD 6.1 billion. In Chinese Mainland, the growth of the new omni-channels was robust, but more than offset by the decline of the general trade channels. Hong Kong operation revenue decreased 3%, mainly due to softness in the Macau and Vitaland business.
The local Hong Kong beverage business remains strong behind solid portfolio execution and brand equity programs. Australia and New Zealand deliver record revenue, while Singapore delivers solid growth. Group operating profit increased by 18% to HKD 430 million, at 7% operating profit margin. Excluding the gain on asset disposal and impairment charge, operating profit margin was at 6%. Chinese Mainland operating profit margin was 14%, 9% excluding disposal, and Hong Kong 12% profit margin was same as last year.
Australian business, excluding the impairment, reduced losses by 48%, while Singapore returned to profitability. Looking forward, the recent Chinese Mainland sales leadership capability step change will further accelerate our omni-channel growth and strengthen our foothold in the traditional general trade. Hong Kong operation will continue to advance its scale leadership through product innovation, complemented by improving Macau business behind new leadership. Both the Australian and Singapore units will continue to drive top-line growth, improve market shares, and ultimate profitability. In the Philippines, we'll continue to scale up its business in this growing category, leveraging both single and multi-serve business across soy, almond, and oat segments.
The Middle East situation has led to disruption of the global supply chain and material cost. We are adopting proactive mitigation measures. While we remain vigilant under this period of uncertainty, we stay confident in our long-term potential and are committed to delivering sustainable growth. Total group revenue decreased by 3%. The Chinese Mainland unit remains the biggest operation by revenue at 53% of the group. The rest of the market mix was unchanged, except for Singapore, who grew to 2% of total behind solid growth. Group operating profit improved by 18% to HKD 430 million.
The China total and Chinese Mainland's operating profit were up 18% and 40%, respectively. If excluding the asset disposal gain of HKD 151 million, China total and Chinese Mainland operating profit dropped by 7% and 9%, respectively. Both the Chinese Mainland and the Hong Kong operation were affected by weak demand, which adversely affected overall profitability. Australia and New Zealand declined by 79% due to impairment, but excluding the HKD 98 million of properties, plants, and equipment impairment charge, Australia significantly reduced the operating loss by 48% versus last year. Meanwhile, Singapore returned to profitability. Let us now move on the market review section starting from China.
China total revenue was HKD 5.4 billion, down 4% versus last year. Operating profit increased by 18% to HKD 698 million. I will now cover separately the Chinese Mainland and the Hong Kong operational results. In Chinese Mainland, operating performance improved in the second half, narrowing the year-on-year decline to 5%. We continue to accelerate in the fast-growing omni-channel, including snack chains, partially mitigating the overall category consumption softness in traditional general trade channels.
By leveraging our core and ongoing innovation, Vitasoy continued to grow market share in the soy segment, while VITA Tea stabilized its position in the sweetened tea segment by the introduction of the Ya Shi Xiang variant. The new sales leadership is now advancing results and commercial capabilities building for stronger product availability and execution. In the new financial year, this new leadership will accelerate availability and field sales execution in the general trade channel, while also continuing to drive joint business planning and customization for strong growth in the omni-channel. We will continue to build our equity via new campaigns on Vitasoy and VITA Tea brands that I would like to show to you now. Starting from Vitasoy first, and then we will show you the VITA Tea.
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In addition to these new marketing campaigns, we are excited to share with you that we've just launched new core range products for both brands. On Vitasoy, the new tea and coffee series enhance consumer relevance across multiple occasions. The new variants are VITASOY Jasmine Tea Soy Milk and Coffee Latte Flavored Soy Milk. On VITA Tea, we have launched VLT Da Hong Pao Finger Lime Lemon Tea, combining Da Hong Pao tea for its unique aroma and rich flavor with distinctive zesty fragrant lime to provide a new exciting lemon tea experience. I hope you enjoy the samples that we are providing today.
So far, the feedback from shoppers and customers have been quite encouraging on these new products. Now, moving to the Hong Kong operation. Our Hong Kong beverage operation remains strong and sustained leadership market share in both plant milk and tea. We experienced a temporary sales and operating profit contraction in Macau and Vitaland, for which we have formulated a solid plan to improve both business performances. We relaunched VITA No Sugar Tea with new formulation and packaging.
A month ago, if you live in Hong Kong, you might have come across the advertising campaign of VITA No Sugar Tea in the two key interchange MTR stations, Admiralty and Tsim Sha Tsui. We also have launched a relevant marketing campaign to drive awareness. I would like to show you now more TVCs. There is going to be two new executions in Cantonese, and then we'll show you the same VITA Tea execution we showed you before in Mandarin, in Cantonese for Hong Kong.
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Okay, let's now go through the other overseas markets, starting with the business in Australia and New Zealand. In Australia, we deliver record revenue growing 2% in local currency, driven by solid increase across both plant milk and yogurt categories. By recalibration of promotional activities' depth and frequency to drive profitable growth, we improve market penetration and market shares across the categories of soy, almond, and yogurt.
Production has stabilized with adequate volume to support business growth, and we have started implementing a cost reduction program. Now, we recorded the non-cash property, plant, and equipment impairment charge of AUD 19 million in the second half of the financial year that we mentioned earlier, further improving the balance sheet structure. Excluding this charge, we effectively reduced operating loss as compared with last year.
For the full year, the operating loss decreased by 48% from HKD 130 million to a loss of only HKD 40 million. We are now driving, just started, a big bang program combining brand new equity campaign, brand packaging, and high protein product platform to accelerate our revenue growth rate. I would like now to show you some new campaign videos to demonstrate our brand equity.
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The campaign is accompanied by visuals and key in-store materials. They are designed to strengthen our brand awareness across all the daily occasions, make the most of the portfolio that we have in Australia. Moving to the Singapore market. We increased revenue by 9% as compared with the previous year, we sustained the growth momentum in our tofu business. We will continue to enhance productivity, strengthen supply reliability, optimize portfolio and cost.
Our imported beverage business continues to improve availability and execution. Now I would like to close the market review by providing you an update of our business in the Philippines. Our joint venture in the Philippines with Universal Robina Corporation, URC, continue to drive the development of Vitasoy in this rapidly growing market. Both our almond and oat segments are now leading the growth while the multi-serve business demonstrate a sustainable growth momentum.
This market evolution in the Philippines is favorable to us as a company, as we are uniquely positioned with a complete know-how to win across all these segments: soy, oat, almond. Like we do every year, before we conclude the presentation, I would also like to give you an update of our progress on sustainability and ESG. I am pleased to share that our sustainability report for the financial year FY 2025-2026 will be available on our website in July alongside our annual report. Vitasoy has released the ESG report for more than 10 years.
Over the time, we have continued to measure our results, report transparently, and also look for ways to improve our sustainability performance. This is our latest sustainability framework that you also have there blown out on the wall. It brings together the progress we have made so far and also sets out our next five-year targets for financial year 2030-2031. As we come to the end of our FY 2025-2026 KPI target cycle, we are encouraged that most of our targets have been achieved. This includes all of our portfolio and packaging targets.
There is one manufacturing KPI that we did not meet our target, and that was energy intensity reduction. We achieved 19.1% reduction against our 25% target. This still represents a meaningful efficiency improvement, although it was below what we had originally targeted ten years earlier. We remain committed to making further progress in this area, and at the same time, we will continue working towards our ultimate goal of eliminating all lost time injuries. Looking ahead, we are now beginning our 2030-2031 KPI target cycle with goals across portfolio, packaging, manufacturing, and workplace.
We see these as stretch targets while still being practical and achievable. Within our portfolio, we continue to make progress in expanding our plant-based, nutritious, lower fat, and lower sugar offerings. We have also maintained full front of pack labeling across all key markets, and our packaging performance remains solid. On the manufacturing side, we are seeing early progress towards our new 2030-2031 water and energy reduction targets. There is still more to do, but the direction is encouraging.
On the external side, we are seeing general improvement across these ESG ratings over time. Although each rating uses a different methodology, together they offer an independent view of our sustainability performance. We see this as a helpful external indicator that our efforts are moving in the right direction. To conclude, in summary, the fiscal year 2025-2026 was an important year for strengthening organizational capabilities for the next phase of sustainable growth. In Chinese Mainland, we have a new sales leadership, advancing results and building stronger capabilities to achieve improved availability and execution going forward.
In the Hong Kong operation, we retain our leadership shares in both plant milk and tea. We also have solid plans to improve Macau and Vitaland business performance. Australia and New Zealand, a new big bang program is designed to sustain growth and continue to drive the bottom line. Singapore will continue to drive the growth in revenue by both tofu and imported beverage business. In the Philippines, we will leverage our unique know-how across soy, almond, and oat to accelerate scale-up in this rapidly growing market.
The Middle East situation has led to some disruption of the global supply chain and material costs. We are adopting proactive measures to mitigate these risks. We stay confident in our long-term potential and are committed to restart delivering sustainable growth. That's all of our sharing today, and we're now open for your questions. Thank you.