Exhibit 99.2
Intelligent Group Limited Reports Unaudited Financial Results for The Six Months Ended May 31, 2024
Hong Kong, November 1, 2024 – Intelligent Group Limited (the “Company” or “we”) (NASDAQ: INTJ), a professional services provider in Hong Kong that principally engages in the provision of financial public relations services, today announced its unaudited financial results for the six months ended May 31, 2024.
Overview
We are a professional services provider in Hong Kong that engages in the provision of Financial PR services. Our Financial PR services include arranging press conferences and interviews, participating in the preparation of news releases and shareholders’ meetings, monitoring news publications, identifying shareholders, targeting potential investors, organizing corporate events, and implementing crisis management policies and procedures.
We aim to build an effective channel for the exchange of information between the public, investors and our clients. We provide information about our clients to the public and investors in a manner designed to enable them to understand our clients’ operations more easily. We also provide training to our clients so as to allow them to understand public relations tactics and practice. The objective is to create a positive market image of our clients to the public.
Recent business development
We serve a diverse and solid base of clients. Our major clients are mainly listing applicants and listed companies in Hong Kong, as well as private companies, investors and international investment banks. We serve eight emerging HK listed clients and one emerging Nasdaq listed company during this period. We believe that our market reputation and our clients’ confidence in our services are indispensable to our continued success.
Forward-looking information
Certain statements in this announcement contains forward-looking statements that involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements by the words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “goal,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue” and “ongoing,” or the negative of these terms, or other comparable terminology intended to identify statements about the future. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. The forward-looking statements and opinions contained in this announcement are based upon information available to us as of the date of this announcement and, while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information.
Revenue
| | | For the Six Months Ended May 31, | |
| | | 2023 | | | 2024 | | | 2024 | |
| | | HK$ | | | HK$ | | | US$ | |
| Revenues: | | | | | | | | | |
| Financial PR Services | | | 7,712,444 | | | | 7,611,392 | | | | 973,336 | |
| Project-based PR Services | | | 416,667 | | | | 848,566 | | | | 108,513 | |
| One-off PR Services | | | — | | | | 1,893,710 | | | | 242,166 | |
| Total revenues | | | 8,129,111 | | | | 10,353,668 | | | | 1,324,015 | |
Financial PR services include regular media press posting, shareholder list and investor relationship maintains, press conference and annual shareholder meeting holding. The revenue is recognized ratably over the service period. For normal Financial PR services, the Group generally receives (i) fixed service fees in respect of our provision of Financial PR services, which are payable in stages; and (ii) periodic (monthly, quarterly or semi-annually) fixed services fees in respect of our provision of retainer services to clients. The Group recognizes revenues from Financial PR services on a monthly basis when it satisfies its performance obligations throughout the contract terms.
For the six months ended May 31, 2023 and 2024, Financial PR services revenue constitutes a significant source of our revenues, which represents 95% and 74% of our total revenues, respectively. Financial PR services revenue maintained steadily during these two periods.
Project-based Financial PR services. We generally receive payment of the total pre-agreed or pre-endorsed fee in full before the Group performs the relevant project-based Financial PR services. The project-based Financial PR services include (i) roadshows; (ii) investor luncheons; (iii) press conference/media briefings; (iv) listing ceremonies; (v) site visit/business tours; and (vi) congratulatory advertisements. The Group recognizes revenues from Project-based Financial PR services on the monthly basis when it satisfies its performance obligations throughout the contract terms.
Project-based financial PR services revenue increased by HK$431,899, from HK$416,667 for the six months ended May 31, 2023 to HK$848,566 (US$108,513) for the six months ended May 31, 2024, primarily due to the decrease in interest rates unveiled by the people’s bank of China in the December 2023 also positive affected the capital markets and fund-raising activities, leading to an increase in demand of our project-based financial PR service.
One-off PR services. We provide add-on services to year around customers, such add-on service is usually an “optional purchase” separately agreed in the recurring financial PR service agreement, by which the customer has the right to exercise the option to purchase additional services in a separately agreed service price. The One-off PR services mainly include writing press release; arrange media interview; re-post business articles. Service revenue is recognized at the point in time when the service is transferred to the customer. The one-off PR service amounted to HK$1,893,710 (US$242,166) for the six months ended May 31, 2023, due to the gradual development of the company’s business, the one-off service income has also increased steadily.
Direct cost of revenues
Direct cost of revenues included employee compensation, related employee benefits and director’s remuneration. The direct cost of revenues also included article services, media and promote on services we provided for our clients.
Our direct cost of revenues increased by HK$2,563,476, or 281%, from HK$912,514 for the six months ended May 31, 2023 to HK$3,475,990 (US$444,506) for the six months ended May 31, 2024. Such increase was mainly due to increase in staff costs and the increase in cost of value-added services (including the design and production of clients’ promotion video, other advertising materials used to be displayed in the screen, and cost to arrange roadshow or listing ceremony) provided to our clients, resulting from the operating strategy with the objective to increase our competitiveness in the market.
Selling expenses
The following table set forth the breakdown of our selling expenses for the periods indicated:
| | | For the Six Months Ended May 31, | |
| | | 2023 | | | 2024 | | | 2024 | |
| | | HK$ | | | HK$ | | | US$ | |
| | | | | | | | | | |
| Entertainment expense | | | 183,234 | | | | 517,307 | | | | 66,153 | |
| Others | | | 153,087 | | | | 60,000 | | | | 7,672 | |
| Total Selling expenses | | | 336,321 | | | | 577,307 | | | | 73,825 | |
Our selling expenses mainly represented entertainment expenses. Our selling expenses are HK$336,321 and HK$577,307 (US$73,825) for the six months ended May 31, 2023 and 2024, respectively. The entertainment expense increased by HK$334,074, mainly due to the increase in capital market activities as a result of positive market sentiment. The frequency of business travel and business entertainment are increased.
Others mainly represented our commission expenses and internet maintenance cost which at HK$153,087 and HK$60,000 (US$7,672) and for the six months ended May 31, 2023 and 2024, respectively.
General and administrative expenses
The following table set forth the breakdown of our general and administrative expenses for the periods indicated:
| | | For the Six Months Ended May 31, | |
| | | 2023 | | | 2024 | | | 2024 | |
| | | HK$ | | | HK$ | | | US$ | |
| Staff costs | | | 598,056 | | | | 1,641,745 | | | | 209,945 | |
| Professional and consultancy fee | | | 1,829,314 | | | | 1,576,579 | | | | 201,611 | |
| Provision for credit losses | | | — | | | | 1,633,025 | | | | 208,830 | |
| Rent and rates | | | 409,423 | | | | 438,065 | | | | 56,019 | |
| Office expenses | | | 85,664 | | | | 102,188 | | | | 13,068 | |
| Depreciation | | | 168,111 | | | | 3,830 | | | | 490 | |
| IT expenses | | | 66,923 | | | | — | | | | — | |
| Others | | | 217,787 | | | | 238,336 | | | | 30,477 | |
| Total General and administrative expense | | | 3,375,278 | | | | 5,633,768 | | | | 720,440 | |
Our general and administrative expenses mainly represented staff costs, IT expenses, professional and consultancy fee, rent and rates, depreciation, office expenses, provision for credit losses and others. Our general and administrative expenses increased by HK$2,258,490, or 67%, from HK$3,375,278 for the six months ended May 31, 2023 to HK$5,633,768 (US$720,440) for the six months ended May 31, 2024, mainly due to increase in provision of credit losses and increase in staff costs.
Staff Costs. Our staff costs increased by HK$1,043,689, or 175%, from HK$598,056 for the six months ended May 31, 2023 to HK$1,641,745 (US$209,945) for the six months ended May 31, 2024, mainly due to appointed independent executive directors during this period, and employed more staff to maintain the business operation.
IT expenses. Our IT expenses decreased by HK$66,923, or 100%, as the online platform had been substantially completed at early 2023.
Professional fee and consultancy fee. Our professional and consultancy fee decreased by HK$252,735, or 14%, from HK$1,829,314 for the six months ended May 31, 2023 to HK$1,576,579 (US$201,611) for the six months ended May 31, 2024, mainly due to the reduction of advisory fees and other professional fees after listing.
Rent and rates. Our rent and rates mainly represented the rental expense on our office located in Hong Kong. We entered into a new lease agreement with an external third party (“the landlord”) for the leasing of office premise in Hong Kong with a lease term of 25 months from February 2023. Affected by the larger office usage area and attractive location, the monthly rental expense corresponding increased.
Depreciation charge. Our depreciation charge mainly represented the depreciation charge of our office equipment, furniture & fixtures and motor vehicle. The depreciation charge decreased by HK$164,281, or 98%, from HK$168,111 for the six months ended May 31, 2023 to HK$3,830 (US$490) for the six months ended May 31, 2024, mainly due to some of the property and equipment had been fully depreciated.
Office expenses. Our office expenses mainly represented office cleansing, post and courier, printing and stationery, telephone and communication and utilities. The office expenses increased by HK$16,524, or 19%, from HK$85,664 for the six months ended May 31, 2023 to HK$102,188 for the six months ended May 31, 2024, mainly related to higher utilization of our office premises during the six months ended May 31, 2024.
Provision for credit losses. Our provision for credit losses increased by HK$1,633,025, from HK$Nil for the six months ended May 31, 2023 to HK$1,633,025 (US$208,830) for the six months ended May 31, 2024, mainly due to receivable aging greater than a year being considered as less possibility to recovery, and the Group makes specific credit losses based on some specific knowledge the Group has acquired that indicate that an account is uncollectible. By assessed credit losses of account receivables, some receivable from customers being valued as provision for credit losses.
Other income, net
Our other income mainly represents bank interest income. The net other income increased by HK$475,685, or 259% from HK$183,740 for the six months ended May 31, 2023 to HK$659,425 for the six months ended May 31, 2024, mainly due to the net proceeds from IPO are deposited in the bank, the bank interest income arising from the bank deposit during the six months ended May 31, 2024.
Income tax
We are subject to income tax on an entity basis on profit arising in or derived from the jurisdiction in which members of our Group domicile or operate.
BVI
Under the current laws of the BVI, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no BVI withholding tax will be imposed.
Hong Kong profits tax
Our Hong Kong subsidiaries are subject to a tax rate of 16.5% on the assessable profits arising in or derived from Hong Kong. From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HK$2,000,000, and 16.5% on any part of assessable profits over HK$2,000,000.
Our income tax expenses changed from HK$540,194 for the six months ended May 31, 2023 to HK$40,302 (US$5,154) for the six months ended May 31, 2024, primarily due to decrease in income before income taxes and increase in deferred tax expense.
For investor and media inquiries please contact:
Contacts
Intelligent Group Limited Investor Relations Contact:
Unit 2803, Level 28, Admiralty Centre
Tower 1, 18 Harcourt Road, Admiralty, Hong Kong
(+852) 3618 8460
Email: pr-team@intelligentjoy.com
INTELLIGENT GROUP LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS
| | | As of
November 30,
2023 | | | As of
May 31,
2024 | | | As of
May 31,
2024 | |
| | | HK$ | | | HK$ | | | US$ | |
| ASSETS | | | | | | | | | |
| Current assets: | | | | | | | | | |
| Cash and cash equivalents | | | 25,296,811 | | | | 65,526,292 | | | | 8,379,428 | |
| Accounts receivable, net | | | 5,420,540 | | | | 5,563,490 | | | | 711,453 | |
| Prepayments and other receivables | | | 80,000 | | | | 1,845,980 | | | | 236,062 | |
| Total current assets | | | 30,797,351 | | | | 72,935,762 | | | | 9,326,943 | |
| | | | | | | | | | | | | |
| Non-current assets: | | | | | | | | | | | | |
| Property and equipment, net | | | 34,748 | | | | 30,919 | | | | 3,954 | |
| Right-of-use assets | | | 1,181,941 | | | | 770,901 | | | | 98,582 | |
| Deferred offering costs | | | 1,544,276 | | | | — | | | | — | |
| Long term deposit and prepayments | | | 265,980 | | | | 1,250,000 | | | | 159,848 | |
| Deferred tax assets | | | 355,566 | | | | 625,015 | | | | 79,926 | |
| Escrow receivable | | | — | | | | 391,056 | | | | 50,008 | |
| Total non-current assets | | | 3,382,511 | | | | 3,067,891 | | | | 392,318 | |
| Total assets | | | 34,179,862 | | | | 76,003,653 | | | | 9,719,261 | |
| | | | | | | | | | | | | |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | |
| Current liabilities: | | | | | | | | | | | | |
| Accruals and other payables | | | 150,940 | | | | 304,659 | | | | 38,959 | |
| Contract liabilities | | | 1,519,584 | | | | 645,916 | | | | 82,599 | |
| Bank borrowings | | | 460,502 | | | | 471,987 | | | | 60,357 | |
| Operating lease liabilities | | | 863,508 | | | | 728,867 | | | | 93,207 | |
| Due to related parties | | | 7,536,359 | | | | 1,667,977 | | | | 213,299 | |
| Taxes payables | | | 3,718,174 | | | | 3,667,055 | | | | 468,938 | |
| Total current liabilities | | | 14,249,067 | | | | 7,486,461 | | | | 957,359 | |
| | | | | | | | | | | | | |
| Other liabilities: | | | | | | | | | | | | |
| Bank borrowings, net of current portion | | | 2,493,662 | | | | 2,255,070 | | | | 288,376 | |
| Operating lease liabilities, net of current portion | | | 293,792 | | | | — | | | | — | |
| Total other liabilities | | | 2,787,454 | | | | 2,255,070 | | | | 288,376 | |
| Total liabilities | | | 17,036,521 | | | | 9,741,531 | | | | 1,245,735 | |
| | | | | | | | | | | | | |
| COMMITMENTS AND CONTINGENCIES | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| SHAREHOLDERS’ EQUITY | | | | | | | | | | | | |
| Ordinary Shares, US$0.00001 par value; 500,000,000 shares authorized; 11,250,000 and 13,125,000 shares issued and outstanding as of November 30, 2023 and May 31, 2024, respectively | | | 874 | | | | 1,021 | | | | 131 | |
| Additional paid-up capital | | | 2,010,103 | | | | 49,897,579 | | | | 6,380,846 | |
| Retained earnings | | | 15,132,364 | | | | 16,363,522 | | | | 2,092,549 | |
| Total shareholders’ equity | | | 17,143,341 | | | | 66,262,122 | | | | 8,473,526 | |
| Total liabilities and shareholders’ equity | | | 34,179,862 | | | | 76,003,653 | | | | 9,719,261 | |
INTELLIGENT GROUP LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF
INCOME
| | | For the Six Months Ended May 31, | |
| | | 2023 | | | 2024 | | | 2024 | |
| | | HK$ | | | HK$ | | | US$ | |
| REVENUE | | | 8,129,111 | | | | 10,353,668 | | | | 1,324,015 | |
| | | | | | | | | | | | | |
| Operating expenses | | | | | | | | | | | | |
| Direct cost of revenues | | | 912,514 | | | | 3,475,990 | | | | 444,506 | |
| Selling expenses | | | 336,321 | | | | 577,307 | | | | 73,825 | |
| General and administrative expenses | | | 3,375,278 | | | | 5,633,768 | | | | 720,440 | |
| Total operating expenses | | | 4,624,113 | | | | 9,687,065 | | | | 1,238,771 | |
| | | | | | | | | | | | | |
| Income from operation | | | 3,504,998 | | | | 666,603 | | | | 85,244 | |
| | | | | | | | | | | | | |
| OTHER INCOME (EXPENSE) | | | | | | | | | | | | |
| Financial expense | | | (53,886 | ) | | | (54,568 | ) | | | (6,977 | ) |
| Other income, nets | | | 183,740 | | | | 659,425 | | | | 84,326 | |
| Total other income, net | | | 129,854 | | | | 604,857 | | | | 77,349 | |
| | | | | | | | | | | | | |
| INCOME BEFORE INCOME TAXES | | | 3,634,852 | | | | 1,271,460 | | | | 162,593 | |
| Income tax expenses | | | 540,194 | | | | 40,302 | | | | 5,154 | |
| | | | | | | | | | | | | |
| NET INCOME | | | 3,094,658 | | | | 1,231,158 | | | | 157,439 | |
| | | | | | | | | | | | | |
| WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES | | | | | | | | | | | | |
| Basic and diluted | | | 11,250,000 | | | | 12,008,197 | | | | 12,008,197 | |
| | | | | | | | | | | | | |
| EARNINGS PER SHARE | | | | | | | | | | | | |
| Basic and diluted | | | 0.28 | | | | 0.10 | | | | 0.01 | |
INTELLIGENT GROUP LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
| | | Ordinary Shares | | | Additional
Paid-in | | | Retained | | | | |
| | | Shares | | | Amount | | | capital | | | earnings | | | Total | |
| | | | | | HK$ | | | HK$ | | | HK$ | | | HK$ | |
| BALANCE, December 1, 2022 | | | 11,250,000 | | | | 874 | | | | 2,010,103 | | | | 11,063,385 | | | | 13,074,362 | |
| Net income | | | — | | | | — | | | | — | | | | 3,094,658 | | | | 3,094,658 | |
| BALANCE, May 31, 2023 | | | 11,250,000 | | | | 874 | | | | 2,010,103 | | | | 14,158,043 | | | | 16,169,020 | |
| | | | | | | | | | | | | | | | | | | | | |
| BALANCE, December 1, 2023 | | | 11,250,000 | | | | 874 | | | | 2,010,103 | | | | 15,132,364 | | | | 17,143,341 | |
| Net income | | | — | | | | — | | | | — | | | | 1,231,158 | | | | 1,231,158 | |
| Issuance of ordinary shares upon IPO, net | | | 1,875,000 | | | | 147 | | | | 47,887,476 | | | | — | | | | 47,887,623 | |
| BALANCE, May 31, 2024 | | | 13,125,000 | | | | 1,021 | | | | 49,897,579 | | | | 16,363,522 | | | | 66,262,122 | |
| | | | | | US$ | | | US$ | | | US$ | | | US$ | |
| BALANCE, May 31, 2024 | | | 13,125,000 | | | | 131 | | | | 6,380,846 | | | | 2,092,549 | | | | 8,473,526 | |
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