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Eric Ng

A couple of directors of bag designer and distributor FX Creations International are entitled to annual salary increments of at least 15 per cent, according to the Growth Enterprise Market candidate's listing prospectus.

It says chairman Petto Ng Pak-to is entitled to an annual salary of HK$780,000 and executive director David Ho Kai-chung a salary of about HK$520,000.

Mr Ng, Mr Ho and Ho Pui-lai - Mr Ng's wife and Mr Ho's sister - are also entitled to bonuses, provided the sum of their bonuses and total salaries are not less than 40 per cent of the net profit of subsidiary FX (HK).

The compensations are stipulated in their service agreements with FX (HK), which is engaged in the retail and distribution of bags.

The agreements will take effect upon FX Creations' listing on May 21, according to executive director Alan Ong Chor-wei.

FX Creations' only other operating subsidiary is Hugo Point (HK), engaged in the subletting of leased properties.

Any salary increments given to the directors will be determined by the board of FX (HK).

FX Creations' directors were paid a total of HK$245,000 for the year to March 31.

Mr Ong played down concerns the salary increments may be excessive.

'This is a fair percentage [of increment], and the company's profit has been growing at quite a large multiple,' he added.

FX Creation's net profit grew to HK$1.86 million in the year to March 31 last year, from HK$685,000 the preceding year. Turnover declined 3.4 per cent year-on-year to HK$38.5 million.

In the eight months to November 30 last year, net profit was HK$217,000. The company paid a special dividend of HK$2 million on March 31 this year to the original shareholders.

Of the HK$5.81 million in bank borrowings at the end of February, HK$5.54 million are repayable within one year.

Mr Ong said the company had HK$10.4 million in banking facilities to renew its borrowings.

The company is aiming to raise net proceeds of about HK$13 million, mainly to finance the acquisition of a plant and production facilities.



FX Creations outlines director compensation boost after offer