Revenue Growth and Performance - Revenue increased by 2.9% to RMB 23,586,327 thousand in FY2024 compared to RMB 22,928,219 thousand in FY2023[2] - Revenue from rice cracker products increased to RMB 5,976,867 thousand in 2024, up from RMB 5,843,348 thousand in 2023[15] - Revenue from dairy and beverage products rose to RMB 11,955,633 thousand in 2024, compared to RMB 11,130,495 thousand in 2023[15] - Revenue from snack products decreased to RMB 5,501,808 thousand in 2024, down from RMB 5,820,262 thousand in 2023[15] - Revenue from other products increased to RMB 152,019 thousand in 2024, up from RMB 134,114 thousand in 2023[15] - Total revenue for the company reached RMB 23,586,327 thousand in 2024, compared to RMB 22,928,219 thousand in 2023[15] - Revenue for the year ended March 31, 2024, reached RMB 23,586,327 thousand, with the Dairy and Beverage segment contributing the highest at RMB 11,955,633 thousand[16] - Total revenue for FY2023 increased by 2.9% year-on-year to RMB 23.5863 billion, with dairy and beverage revenue growing by 7.4% and confectionery revenue reaching a historical high[37] - Total revenue for FY2023 increased by 2.9% YoY to RMB 23.5863 billion, with dairy and beverage revenue growing by 7.4% to RMB 11.9556 billion[45] - Rice and snack category revenue grew by 2.3% YoY to RMB 5.9769 billion, driven by overseas markets and emerging channels, which grew by double digits[46] - Snack category revenue declined by 5.5% YoY to RMB 5.5018 billion, mainly due to a decline in ice cream sales, although candy subcategory revenue reached a historical high[48] Profitability and Margins - Gross profit rose by 9.1% to RMB 10,990,921 thousand in FY2024 from RMB 10,071,028 thousand in FY2023[2] - Operating profit grew by 15.7% to RMB 5,609,825 thousand in FY2024 compared to RMB 4,846,711 thousand in FY2023[2] - Profit attributable to equity holders of the company increased by 18.4% to RMB 3,990,474 thousand in FY2024 from RMB 3,371,584 thousand in FY2023[2] - Gross profit margin improved by 2.7 percentage points to 46.6% in FY2024 from 43.9% in FY2023[2] - Operating profit margin increased by 2.7 percentage points to 23.8% in FY2024 from 21.1% in FY2023[2] - Profit margin attributable to equity holders of the company rose by 2.2 percentage points to 16.9% in FY2024 from 14.7% in FY2023[2] - The company's net profit for the year ended March 31, 2024, was RMB 3,983,179 thousand, up from RMB 3,362,711 thousand in the previous year[16][19] - Gross profit margin for FY2023 rose by 2.7 percentage points to 46.6%, driven by lower raw material and packaging costs, and optimized labor strategies[37] - Net profit attributable to equity holders increased by 18.4% year-on-year to RMB 3.9905 billion, with a profit margin of 16.9%, up 2.2 percentage points[37] - Dairy and beverage category gross margin increased by 3.7 percentage points YoY to 48.5%, benefiting from lower packaging material costs and improved milk powder procurement strategies[52] - Gross profit margin for FY2023 increased by 2.7 percentage points YoY to 46.6%, driven by lower raw material costs and optimized product pricing[50] - Operating profit grew by 15.7% to RMB 5.6098 billion in FY2023, with the operating profit margin increasing by 2.7 percentage points to 23.8%[56] - Net profit attributable to equity holders rose by 18.4% to RMB 3.9905 billion in FY2023, with the profit margin increasing by 2.2 percentage points to 16.9%[58] Assets and Liabilities - Total assets increased to RMB 27,457,068 thousand in FY2024 from RMB 25,974,077 thousand in FY2023[6] - Total equity grew to RMB 16,405,738 thousand in FY2024 from RMB 14,704,070 thousand in FY2023[7] - Total liabilities decreased to RMB 11,051,330 thousand in FY2024 from RMB 11,270,007 thousand in FY2023[7] - Total assets as of March 31, 2024, increased to RMB 27,457,068 thousand, compared to RMB 25,974,077 thousand in the previous year[18][20] - Total liabilities as of March 31, 2024, were RMB 11,051,330 thousand, slightly lower than RMB 11,270,007 thousand in the previous year[18][20] - Net cash position improved to RMB 10.6552 billion as of March 31, 2024, up from RMB 8.3173 billion a year earlier[59] Cash Flow and Capital Expenditures - Capital expenditures for the year ended March 31, 2024, totaled RMB 405,697 thousand, down from RMB 531,292 thousand in the previous year[16][19] - Cash flow from operating activities was RMB 5.1514 billion in FY2023, while cash flow from financing activities was a net outflow of RMB 2.4361 billion[60] - Capital expenditures decreased to RMB 405.7 million in FY2023, with investments in production facilities and equipment for key product categories[61] - Inventory turnover days decreased by 9 days to 81 days in FY2024, reflecting improved supply chain efficiency[62] - Trade receivables turnover days decreased to 13 days in FY2024 from 15 days in FY2023[64] Segment Performance - The Dairy and Beverage segment recorded the highest segment profit at RMB 3,878,837 thousand for the year ended March 31, 2024[16] - The Snack Food segment's revenue for the year ended March 31, 2024, was RMB 5,501,808 thousand, a decrease from RMB 5,820,262 thousand in the previous year[16][19] - Overseas revenue grew by mid-to-high double digits, with significant progress in confectionery products and operations in Vietnam, Thailand, Indonesia, Germany, and North America[42] - Traditional channels saw recovery, with milk products growing by high single digits and beverages by double digits, supported by innovative marketing campaigns[38] - Modern channels grew by low-to-mid single digits, with differentiated product strategies enhancing consumer engagement and service capabilities[39] Product and Market Strategy - New products launched in the past five years accounted for a double-digit percentage of FY2023 revenue, with continued focus on health, taste, and quality[43] - Automated vending machine and OEM channels achieved double-digit revenue growth, becoming key drivers of revenue[37][41] - The company established overseas subsidiaries in five countries and plans to deepen market penetration in Southeast Asia, leveraging the newly operational Vietnam factory[42] - The company plans to launch a limited-edition sports-themed version of its popular "Wangzai Milk" for the 2024 Paris Summer Olympics[47] - The new product "Xiao Xiao Mi Crisp" achieved revenue of over RMB 40 million in FY2023, driven by its unique taste and appeal to younger consumers[46] - The company continues to optimize production efficiency and supply chain layout to improve cost efficiency and profitability[49] Financial Reporting and Governance - The company adopted new and revised Hong Kong Financial Reporting Standards (HKFRS) in 2024, including HKFRS 17 and amendments to HKAS 1, HKAS 8, and HKAS 12[10][11] - The company is evaluating the impact of newly issued but not yet effective HKFRS amendments, which are expected to take effect from 2024 and 2025[13] - The company's Audit and Risk Management Committee reviewed the financial performance for the fiscal year ending March 31, 2024, and discussed internal controls and financial reporting matters with management and external auditors[69] - The company's external auditor, Ernst & Young, confirmed that the figures in the preliminary results announcement for the fiscal year ending March 31, 2024, were consistent with the consolidated financial statements[70] - The company deviated from the Corporate Governance Code by having the Chairman and CEO roles combined, held by Mr. Tsai Eng-Meng, due to his extensive experience and leadership in the food and beverage industry[72] - The company complied with the Standard Code for Securities Transactions by Directors during the fiscal year ending March 31, 2024, as confirmed by all directors[73] - The company will review and enhance its corporate governance practices regularly, considering the latest developments in corporate governance[72] Dividends and Shareholder Returns - The company proposed a final dividend of 3.30 US cents per share for the year ended March 31, 2024, totaling RMB 2,787,496 thousand, up from 2.10 US cents per share in the previous year[27] - The company proposed a final dividend of 3.30 US cents per share for FY2023, totaling approximately USD 390 million[68] - The company plans to pay a final dividend of 3.30 US cents per share for the fiscal year ending March 31, 2024, subject to approval at the Annual General Meeting[78] - The company repurchased a total of 70,138,000 shares for a total amount of HKD 320,720,120 (excluding fees) during the fiscal year ending March 31, 2024[74][75] Operational Efficiency and Costs - Cost of goods sold decreased by 2.0% YoY to RMB 12.5954 billion, primarily due to lower costs of palm oil, paper, and iron materials, which decreased by double digits[49] - Distribution costs increased slightly by RMB 3.09 million YoY to RMB 3.0212 billion, but the distribution cost-to-revenue ratio decreased by 0.4 percentage points to 12.8%[54] - Administrative expenses increased by 6.8% to RMB 3.0431 billion in FY2023, accounting for 12.9% of revenue, up 0.5 percentage points from FY2022[55] - The company's total depreciation for property, plant, and equipment for the year ended March 31, 2024, was RMB 760,280 thousand, slightly up from RMB 759,026 thousand in the previous year[16][19] - Current income tax for the year amounted to RMB 1,260,181 thousand, an increase from RMB 1,056,751 thousand in the previous year[24] - Total income tax expense for the year was RMB 1,422,288 thousand, slightly up from RMB 1,417,239 thousand in the previous year[24] Trade and Credit Management - Trade receivables net of impairment provisions stood at RMB 832,245 thousand, a slight decrease from RMB 853,937 thousand in the previous year[29] - The majority of sales are conducted on a cash-on-delivery basis, with credit terms of 60 to 90 days for modern distribution channels[29] - Total borrowings amounted to RMB 5,351,124 thousand, with a weighted average annual interest rate of 3.16% for RMB-denominated borrowings[33][34] - Short-term borrowings decreased to RMB 2,889,328 thousand from RMB 3,282,014 thousand in the previous year[34] - Trade payables increased to RMB 997,945 thousand from RMB 970,395 thousand in the previous year, with the majority due within 60 days[32] - The company's credit risk exposure is limited to the carrying amount of trade receivables, with no collateral held[30] Shareholder Meetings and Corporate Actions - The company's Annual General Meeting is scheduled to be held on August 27, 2024, with the notice to be published on the company's website and sent to shareholders[77]

Financial Performance - Revenue for the six months ended September 30, 2023, increased by 4.1% to RMB 11,274,818,000 compared to RMB 10,832,945,000 in the same period of 2022[6] - Gross profit rose by 10.0% to RMB 5,100,690,000, resulting in a gross profit margin of 45.2%, up from 42.8%[6] - Operating profit increased by 19.5% to RMB 2,475,563,000, with an operating profit margin of 22.0%, compared to 19.1% in the previous year[6] - Profit attributable to equity holders of the Company was RMB 1,732,245,000, reflecting an 8.5% increase from RMB 1,596,054,000[6] - Basic and diluted earnings per share rose by 8.7% to 14.58 RMB cents, up from 13.41 RMB cents[6] - Total revenue for the first half of 2023FY grew by 4.1% year-on-year to RMB 11,274.8 million, with the dairy products and beverages segment accounting for 54% of total revenue[22] - Profit attributable to equity holders increased by 8.5% year-on-year to RMB 1,732.2 million, with a profit margin of 15.4%[9] - Total comprehensive income for the period was RMB 1,554,838, compared to RMB 1,183,496 in 2022, showing an increase of about 31.4%[57] Operational Efficiency - Inventory turnover days improved to 86 days from 90 days year-on-year[7] - Trade receivables turnover days decreased to 14 days from 15 days[7] - Trade payables turnover days increased slightly to 30 days from 29 days[7] - Distribution costs for the first half of FY2023 were RMB 1,474.8 million, a 0.7% increase year-on-year, while the distribution costs as a percentage of revenue decreased to 13.1%[33] - The Group's cash and bank deposits totaled RMB 15.7435 billion, an increase of RMB 2.0839 billion from RMB 13.6596 billion as of March 31, 2023, primarily due to operating cash inflow of RMB 1.9463 billion[40] Market Expansion and Product Development - The Company is focused on expanding its market presence and enhancing product offerings through new strategies and technologies[5] - Future outlook remains positive with continued investment in product development and market expansion initiatives[5] - Revenue from modern channels grew year-on-year in the first half of FY2023, with significant growth in new products and convenience store channels[10] - New products launched over the past five years contributed nearly double-digit percentage of the Group's revenue in the first half of FY2023[9] - The Group's marketing strategies have improved resource allocation efficiency, enhancing the profitability of e-commerce channels[13] Segment Performance - Revenue from the dairy products and beverages segment increased by 7.1% year-on-year, while the rice crackers segment grew by 4.5% year-on-year[22] - The snack foods segment experienced a decline of 1.5% year-on-year, primarily due to weaker performance in popsicles[22] - Revenue from dairy products and beverages segment grew by 7.1% year-on-year to RMB6,096.7 million, driven by a 20% increase in "Canned Milk" sales[27] - The rice crackers segment's revenue reached RMB 2,060.0 million, with overseas business accounting for around 20% of this segment's revenue and achieving double-digit growth[23] Sustainability and Corporate Responsibility - The Quanzhou plant received the highest level certification of "Zero Waste to Landfill Management System" from TÜV Rheinland, highlighting the Group's commitment to sustainability[16] - The Group's sustainable water management practices were recognized as a "Typical Case of Green, Low Carbon and Sustainability of China Dairy Industry 2023"[17] Financial Position and Liabilities - As of September 30, 2023, the Group's net cash amounted to RMB8,113.3 million, a decrease of RMB204.0 million from March 31, 2023[36] - Total borrowings increased to RMB7,630.2 million, up RMB2,287.9 million from March 31, 2023, with RMB denominated borrowings accounting for nearly 85%[37] - Total liabilities as of September 30, 2023, were RMB 12,902,369, up from RMB 11,270,007, indicating an increase of around 14.5%[53] - The Group's net gearing ratio was -0.56 times as of September 30, 2023, compared to -0.57 times as of March 31, 2023, indicating sufficient cash and banking facilities for working capital and potential investments[40] Employee and Management Information - For the six months ended 30 September 2023, the average number of employees was approximately 38,887, a decrease of 2,342 compared to the year ended 31 March 2023[48] - Total remuneration expenses for the first half of 2023FY amounted to RMB 2,217.4 million[48] - The company invests significantly in continuing education and training programs for its employees to improve their professional knowledge and skills[48] Shareholder Information - The Board has resolved not to declare an interim dividend for the first half of 2023FY[48] - The company may consider conducting share repurchases to maximize shareholders' interests in a prudent manner[48] - The company repurchased a total of 2,677,000 shares for an aggregate amount of HK$13,383,000 during the six months ended 30 September 2023[153] - The directors believe that the share repurchases will enhance the earnings per share of the company[153]

Financial Performance - Revenue for the six months ended September 30, 2023, was RMB 11,274,818 thousand, representing a 4.1% increase from RMB 10,832,945 thousand in the same period of 2022[2] - Gross profit increased by 10.0% to RMB 5,100,690 thousand, up from RMB 4,638,428 thousand year-on-year[2] - Operating profit rose by 19.5% to RMB 2,475,563 thousand compared to RMB 2,072,092 thousand in the previous year[2] - Profit attributable to equity holders of the company was RMB 1,732,245 thousand, an increase of 8.5% from RMB 1,596,054 thousand[2] - Basic and diluted earnings per share increased by 8.7% to RMB 14.58 from RMB 13.41[2] - The gross profit margin improved to 45.2%, up from 42.8% in the prior year, reflecting a 2.4 percentage point increase[2] - The operating profit margin also improved to 22.0%, compared to 19.1% in the previous year, an increase of 2.9 percentage points[2] - The group reported a profit before tax of RMB 2,366,916 thousand, with income tax expenses amounting to RMB 639,730 thousand, resulting in a net profit of RMB 1,727,186 thousand for the period[14] - Profit attributable to equity holders increased by 8.5% to RMB 1.7322 billion, with a profit margin of 15.4%, up 0.7 percentage points from the previous year[26] Revenue Breakdown - The revenue breakdown includes RMB 2,059,979 thousand from rice snacks, RMB 6,096,666 thousand from dairy and beverages, RMB 3,031,829 thousand from leisure foods, and RMB 86,344 thousand from other products[14] - In the first half of fiscal year 2023, total revenue grew by 4.1% year-on-year to reach RMB 11.2748 billion, with dairy and beverage products accounting for 54% and rice snacks and leisure foods for 45% of total revenue[35] - The dairy and beverage segment saw a year-on-year revenue increase of 7.1%, reaching RMB 6.0967 billion, driven by a nearly 20% growth in canned milk sales[37] - The rice snacks category reported a revenue increase of 4.5% year-on-year, reaching RMB 2.060 billion, with overseas business contributing approximately 20% of this segment's performance[36] - The leisure food segment experienced a revenue decline of 1.5% year-on-year, totaling RMB 3.0318 billion, primarily due to a weak performance in the ice cream subcategory[38] Assets and Liabilities - Total assets as of September 30, 2023, were RMB 27,358,320 thousand, up from RMB 25,974,077 thousand as of March 31, 2023[6] - Total liabilities increased to RMB 12,902,369 thousand from RMB 11,270,007 thousand, indicating a rise in financial obligations[7] - Trade receivables as of September 30, 2023, amounted to RMB 947.45 million, up from RMB 900.396 million as of March 31, 2023[23] - Trade payables increased to RMB 1.11581 billion as of September 30, 2023, compared to RMB 970.395 million as of March 31, 2023[25] - Net cash as of September 30, 2023, was RMB 8.1133 billion, a decrease of RMB 204 million from March 31, 2023[48] - The total borrowings as of September 30, 2023, increased by RMB 2.2879 billion to RMB 7.6302 billion, with RMB borrowings accounting for nearly 85% of total borrowings[49] Capital Expenditures - Capital expenditures totaled RMB 220,252 thousand, with RMB 48,682 thousand allocated to rice snacks, RMB 66,265 thousand to dairy and beverages, RMB 47,035 thousand to leisure foods, and RMB 18,855 thousand to other products[14] - Capital expenditures for the first half of FY2023 were RMB 220.3 million, primarily for expanding production facilities for various product categories[51] Market Strategy and Growth - The company continues to focus on expanding its market presence in North America, East Asia, Southeast Asia, and Europe, enhancing its product distribution capabilities[8] - The company continues to focus on channel diversification and product innovation to drive long-term growth[27] - The group plans to expand emerging channels and overseas markets in the second half of fiscal year 2023, focusing on seasonal sales activities[34] - The group reported a significant increase in profit from dairy and beverages, reaching RMB 2,022,069 thousand, compared to RMB 1,656,504 thousand in the previous year[14] - The group's overseas business revenue achieved high double-digit growth in the first half of fiscal year 2023, with significant revenue increases in Asia and the Americas[30] Shareholder Returns and Governance - The company decided not to declare an interim dividend for the six months ended September 30, 2023, compared to RMB 919.506 million for the same period in 2022[22] - The company aims to maximize shareholder value through prudent cash dividend distribution and share repurchase policies[59] - The company has repurchased a total of 2,677,000 shares for a total amount of HKD 13,383,000 at an average price of HKD 5.00 per share during April 2023[63] - As of September 30, 2023, the company has repurchased an additional 14,513,000 shares for a total amount of HKD 70,867,170 at an average price of HKD 5.06 per share[65] - The company has complied with the corporate governance code, except for the separation of the roles of Chairman and CEO[61] - The company will continue to review its governance structure as necessary, considering its current development stage[61] Operational Efficiency - Distribution costs increased by RMB 10.5 million, or 0.7%, to RMB 1.4748 billion in the first half of FY2023, while the distribution cost as a percentage of revenue decreased by 0.4 percentage points to 13.1%[45] - Inventory turnover days decreased to 86 days as of September 30, 2023, down from 90 days as of March 31, 2023[53] - The average number of employees in the first half of FY2023 was approximately 38,887, a decrease of 2,342 from the previous year[57] Compliance and Reporting - The company has adopted new and revised Hong Kong Financial Reporting Standards, which primarily affect the disclosure of deferred tax assets but do not impact the overall financial position[12] - The company has not applied initial recognition exemptions for lease transactions prior to the recent amendments, which has led to changes in the recognition of deferred tax assets related to lease liabilities[12] - The Audit and Risk Management Committee has reviewed the unaudited interim results for the six months ended September 30, 2023[60] - The company has issued a total of 11,864,893,135 shares as of the announcement date[65] - The company’s functional currency is USD, while over 90% of its operations are in mainland China, leading to foreign exchange risks primarily from overseas procurement[58]

Company Listing and Stock Information - Want Want China Holdings Limited is listed on The Stock Exchange of Hong Kong Limited with stock code 0151[1] Board of Directors and Committees - The company's executive directors include Mr. Tsai Eng-Meng as Chairman and CEO, Mr. Tsai Shao-Chung, Mr. Tsai Wang-Chia as COO, Mr. Huang Yung-Sung as CMO, and Mr. Chu Chi-Wen as CFO[4] - The company's independent non-executive directors include Dr. Pei Kerwei, Mr. Hsieh Tien-Jen, Mr. Lee Kwok Ming, Mr. Pan Chih-Chiang, and Mrs. Kong Ho Pui King, Stella[4] - The company's audit and risk management committee is chaired by Mr. Lee Kwok Ming, with members including Dr. Pei Kerwei, Mr. Hsieh Tien-Jen, Mr. Pan Chih-Chiang, and Mrs. Kong Ho Pui King, Stella[4] - The company's remuneration committee is chaired by Mr. Hsieh Tien-Jen, with members including Dr. Pei Kerwei, Mr. Tsai Shao-Chung, Mr. Lee Kwok Ming, Mr. Pan Chih-Chiang, and Mrs. Kong Ho Pui King, Stella[4] - The company's nomination committee is chaired by Dr. Pei Kerwei, with members including Mr. Tsai Shao-Chung, Mr. Hsieh Tien-Jen, Mr. Lee Kwok Ming, Mr. Pan Chih-Chiang, and Mrs. Kong Ho Pui King, Stella[5] - The company's strategy committee is chaired by Mr. Tsai Eng-Meng, with members including Mr. Liao Ching-Tsun, Mr. Tsai Shao-Chung, Mr. Tsai Wang-Chia, Mr. Huang Yung-Sung, Mr. Chu Chi-Wen, Mr. Tsai Ming-Hui, Ms. Lai Hong Yee, Dr. Pei Kerwei, Mr. Hsieh Tien-Jen, Mr. Lee Kwok Ming, Mr. Pan Chih-Chiang, and Mrs. Kong Ho Pui King, Stella[5] - The company's ESG committee is chaired by Mr. Tsai Wang-Chia, with members including Mr. Chu Chi-Wen, Dr. Pei Kerwei, Mr. Lee Kwok Ming, Mrs. Kong Ho Pui King, Stella, Ms. Cao Yong-Mei, Mr. Chen Chien-Chen, Mr. Yu Ching Lun, and Mr. Lee Ming-Chun[6] Auditors and Legal Advisors - The company's auditor is Ernst & Young Certified Public Accountants, and its legal advisor is Sullivan & Cromwell (Hong Kong) LLP[6] Principal Banks - The company's principal banks include Bank of China (Hong Kong) Limited, China Merchants Bank Co., Limited, Citigroup Inc., and CTBC Bank Co., Ltd, Hong Kong Branch[6] Overseas Expansion and Production - The company's Vietnam production base commenced construction in 2020 to strengthen overseas market expansion and future development strategy[8] - In 2022, the new factory in Tiền Giang province, Vietnam commenced production, marking the first step towards the company's "Dream of the World"[8] - Want Want's Vietnam factory officially commenced production, marking the first step towards the "Dream of the World"[40] - The Group's factory in Vietnam officially commenced production, representing the first step towards the "Dream of the World"[40] Operational Overview - As of 31 March 2023, the company had 422 sales offices, 35 production bases, and 81 factories in the Chinese mainland, working with over 10,000 distributors[9] - The company's principal activities include manufacturing, distribution, and sale of rice crackers, dairy products, beverages, and snack foods[9] - The company's operations are primarily located in the Chinese mainland, with an extensive nationwide sales and distribution network, and exports to North America, East Asia, Southeast Asia, and Europe[9] Financial Performance - Annual profit for 2022FY was RMB 3,362,711 thousand, a decrease from RMB 4,189,114 thousand in 2021FY[29] - Revenue for 2023FY was RMB 22,928,219 thousand, compared to RMB 23,984,891 thousand in 2022FY[31] - Basic earnings per share for 2023FY were RMB 28.35 cents, down from RMB 35.16 cents in 2022FY[31] - Total assets decreased to RMB 25,974,077 thousand in 2023FY from RMB 29,857,981 thousand in 2022FY[32] - Total equity declined to RMB 14,704,070 thousand in 2023FY from RMB 16,708,778 thousand in 2022FY[32] - Current liabilities increased to RMB 8,774,979 thousand in 2023FY from RMB 9,248,528 thousand in 2022FY[32] - Non-current assets remained stable at RMB 13,168,233 thousand in 2023FY compared to RMB 13,269,649 thousand in 2022FY[32] - Profit before income tax for 2023FY was RMB 4,779,950 thousand, down from RMB 5,734,383 thousand in 2022FY[31] - Dividends attributable to equity holders of the company were RMB 2,652,397 thousand in 2023FY, compared to RMB 4,691,334 thousand in 2022FY[31] - Shares repurchased and cancelled in 2023FY amounted to RMB 81,105 thousand, a significant decrease from RMB 819,493 thousand in 2022FY[31] Awards and Recognitions - Want Want's "Research and Application of Low Carbon, Energy Saving, and Automation Technologies" project won the Project Award at the 7th China Grand Awards for Industry[37] - Hot-Kid Baby Mum-Mum Organic Gentle Teething Wafers Super Berries and Want Want Lactoferrin Laboratory Lactoferrin Yogurt – Original Flavor won Monde Selection Gold Quality Awards[33] - Want Want Lactoferrin Laboratory Lactoferrin Yogurt – Original Flavor Reinforced Version won Monde Selection Silver Quality Award[33] - Research on fruit yogurt technology won the Second Prize of the Technology Advancement Award from the China Dairy Industry Association[34] - Fix XBody Soba Noodles and Low GI Chia Seed Crackers were awarded 2021-2022 Excellent Innovative Products of China Instant Food Industry[35] - Want Want Zhejiang Ming Want Dairy Plant won the "Award for Excellence in Consistent TPM Commitment – 2022"[38] - Want Want continues to be one of the top 25 Best Taiwan Global Brands and was ranked third[38] - Want Won the 2022 China Dairy Industry High Quality Development Enterprise Award[34] Revenue and Market Performance - Total revenue for 2022FY declined by 4.4% year-on-year to RMB22,928.2 million[44][45] - Gross profit margin decreased by 0.9 percentage points to 43.9% in 2022FY, but rebounded to 44.9% in the second half of the year, up 1.9 percentage points year-on-year[46][50] - Profit attributable to equity holders of the Company decreased by 19.8% year-on-year to RMB3,371.6 million in 2022FY[44][46] - Revenue from rice crackers and snack foods segments maintained mid-to-high single-digit growth, contributing 51% of total revenue[45][49] - Emerging content e-commerce channels experienced rapid growth, while overseas markets recorded double-digit growth[45][49] - New products launched within the past five years contributed a near double-digit percentage of the Group's revenue in 2022FY[45] - The Group plans to deepen product and channel diversification strategies, expand emerging channels and overseas markets, and increase point-of-sale coverage[47][50] - Traditional distribution channels saw low-to-mid single-digit growth in rice cracker and snack foods segments despite a decline in dairy product sales[49][51] - The Group will launch a series of small-pack products to enhance product mix and convenience for consumers[51] - The popsicles sub-category and beans, jellies, and other snack foods sub-category achieved double-digit growth in 2022FY[45] - The Group plans to enhance the penetration rate of convenience store channels and launch a new dairy product, "Daily Milk," made from raw cow milk to meet diversified consumer needs[52] - In 2022FY, the Group achieved revenue growth in rice crackers and snack foods segments despite reduced consumer traffic due to pandemic restrictions, driven by new product combinations and active development of emerging channels[52] - The Group's overseas business achieved double-digit growth in 2022FY, with balanced growth rates across all three key product segments, supported by improved supply chain efficiency and expansion into overseas Chinese markets[52] - The Group will increase the number of vending machines and expand theme stores to promote the rapid development of maternity, OEM, and special channels, aiming to serve more end-consumers with diversified shopping choices[52] - The Group launched new brands such as "Baby Mum-Mum," "Fix XBody," "Mr. Hot," "Mr. Bond," "Queen Alice," and "Got Rice" to meet the needs of different consumer age groups[55][56][57][58] - The Group actively developed new e-commerce models like content e-commerce and social e-commerce, which contributed to substantial growth[52] - The Vietnam factory's commencement of production will leverage cost and geographical advantages to complement the Group's existing production and supply chain networks[52] - Five new overseas subsidiaries in Southeast Asia, America, and Europe have started operations to support the Group's strategy of expanding into overseas markets[52] - Total revenue for 2022FY declined by 4.4% year-on-year to RMB22,928.2 million, with rice crackers and snack foods segments growing by 4.5% and 7.8% respectively, while dairy products and beverages segment decreased by 13.5%[60][64] - Revenue from the rice crackers segment grew by 4.5% year-on-year to RMB5,843.3 million, driven by channel diversification and double-digit growth in overseas markets[61][65] - Revenue from the dairy products and beverages segment decreased by 13.5% year-on-year to RMB11,130.5 million, with "Hot-Kid Milk" recording a double-digit decline but resuming growth in Q4 2022FY[63][66] - New products in the rice crackers segment launched within the past five years contributed a mid-to-high single-digit percentage of the segment's revenue in 2022FY[62][65] - Revenue from the snack foods segment grew by 7.8% year-on-year to RMB5,820.3 million, with popsicles and beans/jellies sub-categories achieving double-digit growth[69] - The Group launched "Hot-Kid Milk in Little Red Bottle" (PET-bottled), generating over RMB80 million in revenue in 2022FY[67] - New flavored milk products like "Nut Milk" and "Chocolate Milk" exceeded RMB200 million in revenue in 2022FY[67] - The Group obtained 94 patents in 2022FY and won the "7th China Industry Award" for its low-carbon and automation technology research[59] - Revenue from new products in the dairy products and beverages segment launched within the past five years exceeded RMB700 million in 2022FY[63][66] - The Group achieved double-digit growth in emerging channels, including content e-commerce and smart vending machines, enhancing point-of-sale coverage[62][65] - Revenue from the candies sub-category increased by mid-single digit year-on-year, reaching a new all-time record high, with double-digit growth in modern channels[70] - The Group launched "Want Want QQ Juice 100," an innovative product with "chewable juice," which was well-received by consumers[70] - Revenue from the dairy and beverages category exceeded RMB 80 million in 2022FY, with new products like "Nut Milk" and "Chocolate Milk" contributing to a record high of over RMB 200 million[71] - Snack foods revenue reached RMB 5.8203 billion in 2022FY, a year-on-year increase of 7.8%, with double-digit growth in ice cream and beans/jellies sub-categories[72] - The "Frozen Delight" product achieved revenue of nearly RMB 300 million in 2022FY, driven by high summer temperatures and increased freezer penetration[72] - The Group's cost of sales in 2022FY was RMB 12.8572 billion, a year-on-year decrease of 2.9%, despite increases in raw material costs such as whole milk powder and sugar[73] - Gross profit margin decreased by 0.9 percentage points to 43.9% in 2022FY, but improved by 2.1 percentage points in the second half of the year to 44.9%[73] - The gross profit margin for rice crackers increased by 1.2 percentage points to 42.6% in 2022FY, with a significant improvement to 45.3% in the second half due to high-margin gift pack sales[74] - The dairy and beverages segment's gross profit margin decreased by 1.9 percentage points to 44.8% in 2022FY, impacted by an 18% year-on-year increase in the unit cost of imported whole milk powder[75] - The snack foods segment's gross profit margin decreased by 0.8 percentage points to 43.4% in 2022FY, but improved to 44.7% in the second half due to cost optimizations[76] - The gross profit margin for the leisure food category in 2022FY was 43.4%, a decrease of 0.8 percentage points year-on-year, mainly due to double-digit cost increases in raw materials such as white sugar, skimmed milk powder, and eggs[79] - Distribution costs for 2022FY decreased by RMB115.1 million to RMB3,018.1 million, with distribution costs as a percentage of revenue increasing by 0.1 percentage point to 13.2%[80] - Administrative expenses for 2022FY increased by RMB114.5 million to RMB2,849.2 million, representing a 4.2% increase compared to 2021FY, with administrative expenses as a percentage of revenue rising by 1.0 percentage point to 12.4%[81] - The Group's operating profit for 2022FY decreased by 11.2% to RMB4,846.7 million, with the operating profit margin declining by 1.7 percentage points to 21.1%[82] - Income tax expense for 2022FY was RMB1,417.2 million, with the income tax rate increasing by 2.7 percentage points to 29.6%[83] - Profit attributable to equity holders of the Company for 2022FY decreased by 19.8% to RMB3,371.6 million, with the margin decreasing by 2.8 percentage points to 14.7%[84] - As of 31 March 2023, the Group's net cash decreased by RMB1,783.3 million to RMB8,317.3 million compared to 31 March 2022, mainly due to dividend payments[89] - Total borrowings as of 31 March 2023 decreased by RMB1,559.9 million to RMB5,342.3 million compared to 31 March 2022, primarily due to repayment of borrowings using the Group's own funds[89] - The Group's net gearing ratio as of 31 March 2023 was -0.57 times, compared to -0.61 times in 2022[90] - Net cash inflow from operating activities in 2022FY was RMB4,218.7 million, primarily driven by a profit before income tax of RMB4,780.0 million[90] - Net cash outflow for financing activities in 2022FY was RMB7,428.7 million, including RMB2,129.7 million for borrowings and RMB5,078.9 million for dividend payments[90] - Net cash outflow for investing activities in 2022FY was RMB3,153.5 million, mainly due to RMB2,664.7 million placed in bank deposits with original maturity of more than three months[90] - Cash and cash equivalents as of 31 March 2023 amounted to RMB5,047.9 million, with total liquidity reaching RMB13,659.6 million including long-term bank deposits[90] - Capital expenditure for 2022FY was RMB531.3 million, with significant investments in production plants and equipment for key product segments[90] - Inventory turnover days increased by 11 days to 90 days in 2022FY, primarily due to higher raw material inventory levels in response to pandemic uncertainties[93] - Trade receivables turnover days remained stable at 15 days for both 2022FY and 2021FY[96] - Trade payables turnover days increased slightly to 29 days in 2022FY, compared to 28 days in 2021FY[96] - No assets of the Group were pledged as of 31 March 2023[96] - Average number of employees for 2022FY was approximately 41,229, a decrease of 36 employees compared to the previous year[97] - Total remuneration expenses for 2022FY amounted to RMB4,564.0 million[97] - The Group's functional currency is USD, with over 90% of operating activities conducted in mainland China, where the functional currency is RMB[97] - The Board recommended a final dividend of US2.10 cents per share for 2022FY, amounting to approximately US$249.5 million (RMB1,717.7 million)[97] - An interim dividend of US1.14 cents per share for 2022FY was paid in January 2023, amounting to approximately US$135.5 million (RMB934.7 million)[97] - Total dividends for 2022FY amounted to US3.24 cents per share, representing approximately 79% of the profit attributable to equity holders[97] - The Group used hedging products to mitigate foreign exchange risks during 2022FY[97] Corporate Governance - The Company is committed to maintaining high standards of corporate governance practices and procedures[98] - The Company complied with the Corporate Governance Code of the Hong Kong Stock Exchange Listing Rules, except for a deviation from code provision C.2.1[99] - Directors confirmed compliance with the Model Code for Securities Transactions throughout the year ended 31 March 2023[100] - The Board consists of 15 Directors as of March 31, 2023, including 7 executive Directors, 3 non-executive Directors, and 5 independent non-executive Directors[105] - The Board is responsible for overseeing the Group's operating and financial performance, approving annual operating

Financial Performance - Revenue decreased by 4.4% to RMB 22,928,219 thousand compared to RMB 23,984,891 thousand in the previous year[2] - Gross profit declined by 6.3% to RMB 10,071,028 thousand from RMB 10,747,394 thousand[2] - Operating profit dropped by 11.2% to RMB 4,846,711 thousand from RMB 5,456,813 thousand[2] - Net profit attributable to equity holders of the company fell by 19.8% to RMB 3,371,584 thousand from RMB 4,202,655 thousand[2] - Gross margin decreased by 0.9 percentage points to 43.9% from 44.8%[2] - Operating profit margin declined by 1.7 percentage points to 21.1% from 22.8%[2] - Net profit margin attributable to equity holders of the company decreased by 2.8 percentage points to 14.7% from 17.5%[2] - Total revenue for the fiscal year ending March 31, 2023, was RMB 22,928,219 thousand, a decrease of 4.4% compared to RMB 23,984,891 thousand in the previous year[15][16] - Total revenue for fiscal year 2022 decreased by 4.4% year-on-year to RMB 22.9282 billion, with dairy and beverage categories declining by double digits due to pandemic restrictions[33] - Gross profit margin for fiscal year 2022 decreased by 0.9 percentage points to 43.9%, but rebounded to 44.9% in the second half of the year, up 1.9 percentage points year-on-year[33] - Net profit attributable to equity holders decreased by 19.8% year-on-year to RMB 3.3716 billion in fiscal year 2022[33] - Operating profit for FY2022 decreased by 11.2% to RMB 4.8467 billion, with the operating profit margin dropping by 1.7 percentage points to 21.1%[54] - Net profit attributable to equity holders for FY2022 decreased by 19.8% to RMB 3.3716 billion, with the profit margin dropping by 2.8 percentage points to 14.7%[55] Segment Performance - The Dairy and Beverage segment generated the highest revenue at RMB 11,130,495 thousand, accounting for 48.5% of total revenue, but saw a 13.5% decline from the previous year[15][16] - The Rice Snacks segment revenue increased by 4.5% to RMB 5,843,348 thousand, representing 25.5% of total revenue[15][16] - The Snack Foods segment revenue grew by 7.8% to RMB 5,820,262 thousand, contributing 25.4% to total revenue[15][16] - The Other Products segment revenue rose by 9.9% to RMB 134,114 thousand, though it only accounted for 0.6% of total revenue[15][16] - Rice cracker category revenue grew by 4.5% to RMB 5.8433 billion, driven by channel diversification and double-digit growth in overseas markets[43] - Dairy and beverage category revenue declined by 13.5% to RMB 11.1305 billion, with a double-digit decline in "Want Want Milk" but recovery in Q4 FY2022 and further acceleration in FY2023[45] - Snack category revenue grew by 7.8% to RMB 5.8203 billion, with double-digit growth in ice cream, beans, and jelly subcategories, and mid-single-digit growth in the candy subcategory[46] Financial Position - Total assets decreased to RMB 25,974,077 thousand from RMB 29,857,981 thousand[6] - Total equity decreased to RMB 14,704,070 thousand from RMB 16,708,778 thousand[7] - Total liabilities decreased to RMB 11,270,007 thousand from RMB 13,149,203 thousand[7] - Total assets decreased by 13.0% to RMB 25,974,077 thousand as of March 31, 2023, compared to RMB 29,857,981 thousand in the previous year[18][20] - Total liabilities decreased by 14.3% to RMB 11,270,007 thousand as of March 31, 2023, from RMB 13,149,203 thousand in the previous year[18][20] - Net cash as of March 31, 2023, was RMB 8.3173 billion, a decrease of RMB 1.7833 billion compared to March 31, 2022, primarily due to dividend payments[55] Cost and Margin Analysis - Cost of goods sold decreased by 2.9% to RMB 12.8572 billion, with significant price increases for key raw materials such as whole milk powder and sugar, but cost pressures eased in the second half of the year[47] - Gross profit margin decreased by 0.9 percentage points to 43.9%, but improved by 2.1 percentage points in the second half of the year to 44.9% due to cost optimization and product mix adjustments[48] - Rice cracker category gross margin increased by 1.2 percentage points to 42.6%, with a significant improvement in the second half of the year to 45.3% due to higher sales of high-margin gift packs and lower palm oil costs[49] - Dairy and beverage category gross margin decreased by 1.9 percentage points to 44.8%, primarily due to an 18% increase in the cost of imported whole milk powder, but is expected to improve as raw material costs stabilize[50] - Snack category gross margin decreased by 0.8 percentage points to 43.4%, but improved in the second half of the year to 44.7% due to cost management and product structure optimization[51] Expenses and Profitability - Distribution costs for FY2022 were RMB 3.0181 billion, a decrease of RMB 115.1 million compared to FY2021, with the distribution cost to revenue ratio rising by 0.1 percentage points to 13.2%[52] - Administrative expenses for FY2022 increased by 4.2% to RMB 2.8492 billion, with the administrative expense to revenue ratio rising by 1.0 percentage points to 12.4%[53] - Operating profit for FY2022 decreased by 11.2% to RMB 4.8467 billion, with the operating profit margin dropping by 1.7 percentage points to 21.1%[54] - Net profit attributable to equity holders for FY2022 decreased by 19.8% to RMB 3.3716 billion, with the profit margin dropping by 2.8 percentage points to 14.7%[55] Capital Expenditures and Investments - The company's capital expenditures increased by 15.4% to RMB 531,292 thousand in FY2023, up from RMB 460,547 thousand in FY2022[16][19] - Capital expenditures for FY2022 were RMB 531.3 million, with significant investments in production facilities for rice products, dairy and beverages, and snack foods[58] Contract Liabilities and Revenue Recognition - Contract liabilities for rice products increased to RMB 402,635 thousand, up 36.4% year-over-year[21] - Contract liabilities for dairy and beverages rose to RMB 775,203 thousand, a 14.2% increase compared to the previous year[21] - Contract liabilities for snacks grew to RMB 404,499 thousand, marking a 46.8% year-over-year growth[21] - Total contract liabilities reached RMB 1,591,926 thousand, up 26.8% from the previous year[21] - Revenue recognized from contract liabilities for rice products was RMB 295,195 thousand, down 24.8% year-over-year[22] - Revenue recognized from contract liabilities for dairy and beverages was RMB 678,570 thousand, a 13.1% decrease compared to the previous year[22] - Total revenue recognized from contract liabilities was RMB 1,255,592 thousand, down 19.3% year-over-year[22] Exchange Gains and Other Income - Net exchange gain was RMB 17,600 thousand, compared to a net loss of RMB 2,171 thousand in the previous year[23] - Long-term bank deposit income increased to RMB 241,394 thousand, up 70.3% year-over-year[23] Earnings Per Share and Dividends - Basic earnings per share were RMB 28.35 cents, down from RMB 35.16 cents in the previous year[26] - The company proposed a final dividend of 2.10 US cents per share for the 2022 fiscal year, amounting to approximately $249.5 million (approximately RMB 1.7177 billion)[65] - The total dividend for the 2022 fiscal year was 3.24 US cents per share, totaling approximately $385 million, representing 79% of the company's profit attributable to equity holders for the year[65] - The company proposed a final dividend of 2.10 US cents per share for the fiscal year ending March 31, 2023, subject to approval at the Annual General Meeting, with payment expected on or around September 14, 2023[75] Share Repurchases - The company repurchased a total of 17,445,000 shares on the Hong Kong Stock Exchange during the fiscal year ending March 31, 2023, at a total cost of HK$89,273,930 (excluding fees)[71] - After the fiscal year end, the company repurchased an additional 2,677,000 shares on the Hong Kong Stock Exchange at a total cost of HK$13,383,000 (excluding fees)[73] - The company's board believes that the share repurchases are in the best interests of the company and its shareholders and can enhance the company's earnings per share[73] Corporate Governance and Meetings - The company's Annual General Meeting is scheduled to be held on August 22, 2023, with the notice to be published on the company's website and sent to shareholders in due course[74] - The company's share register will be closed from August 26 to August 30, 2023, to determine eligibility for the proposed final dividend[75] Overseas Expansion and New Products - Overseas business achieved double-digit growth in fiscal year 2022, with balanced growth across three major categories[37] - The Vietnam factory has officially commenced production, marking the first step in the company's global expansion strategy[32] - New products launched within the last five years accounted for nearly double-digit percentage of the company's total revenue in fiscal year 2022[33] - The company plans to launch a new dairy product, "Daily Milk Drink," in small blue bottles to meet diverse consumer needs[35] - The company will continue to expand its presence in emerging channels such as content e-commerce and social e-commerce, which showed significant growth in fiscal year 2022[36] - The company has established five new overseas subsidiaries in Southeast Asia, America, and Europe to support its overseas market expansion strategy[37] Inventory and Receivables Management - Inventory turnover days increased to 90 days in FY2022, up from 79 days in FY2021, due to increased raw material reserves in response to pandemic uncertainties[60] - Trade receivables turnover days remained stable at 15 days for both FY2022 and FY2021[62] - Trade payables turnover days increased slightly to 29 days in FY2022, up from 28 days in FY2021[63] Employee and Compensation - The company's average number of employees in FY2022 was 41,229, a slight decrease of 36 compared to FY2021, with total employee compensation at RMB 4.564 billion[63] Financial Reporting Standards - The company adopted revised Hong Kong Financial Reporting Standards (HKFRS) for the first time in the current year, including amendments to HKFRS 3, HKAS 16, and HKAS 37, with no material impact on financial performance[10] - HKFRS 3 amendments replaced previous financial reporting frameworks with the 2018 Conceptual Framework, with no significant changes to recognition principles, and had no impact due to no business combinations during the year[11] - HKAS 16 amendments prohibit deducting costs from proceeds of property, plant, and equipment sales before intended use, with retrospective application from April 1, 2021, and no impact as no such sales occurred[11] - HKAS 37 amendments clarify that costs directly related to contracts include incremental costs and allocated costs, with prospective application from April 1, 2022, and no impact as no loss-making contracts were identified[11] - HKFRS 9 amendments clarify fees considered when assessing changes in financial liability terms, with prospective application from April 1, 2022, and no impact as no changes or exchanges of financial liabilities occurred[12] - The company has not yet applied newly issued but not yet effective HKFRS standards, including amendments to HKFRS 10, HKAS 28, HKFRS 16, and HKFRS 17, with no expected material impact on financial performance[13] Geographic and Customer Concentration - Over 90% of the company's revenue and non-current assets are located in China[14] - No single customer accounted for 10% or more of the company's total revenue in both FY2023 and FY2022[14]

Financial Performance - Total revenue for the first half of FY2022 declined by 4.8% year-on-year to RMB10,832.9 million[10] - Gross profit margin decreased by 4.0 percentage points year-on-year to 42.8%[10] - Profit attributable to equity holders of the Company decreased by 23.6% year-on-year to RMB1,596.1 million[10] - The total revenue for the first half of FY2022 decreased by 4.8% year-on-year, reaching CNY 10.8329 billion, with a gross margin decline of 4.0 percentage points to 42.8%[11] - The profit attributable to equity holders of the company fell by 23.6% year-on-year, amounting to CNY 1.5961 billion[11] - The Group's operating profit for the first half of 2022FY was RMB2,072.1 million, a decrease of 25.5% year-on-year, with an operating profit margin of 19.1%[24] - Profit for the period was RMB 1,590,078, a decrease of 23.7% compared to RMB 2,083,788 in the same period last year[54] - Total comprehensive income for the period was RMB 1,183,496, a significant decrease of 46.8% from RMB 2,220,118 in the previous year[54] Revenue Segmentation - Products accounting for 44% of total revenue recorded a year-on-year increase, with popsicles and QQ Gummies achieving double-digit revenue growth[9] - Revenue from traditional distribution channels declined by mid-single digits year-on-year, primarily due to weak sell-through momentum of dairy products and beverages[12] - The snack foods segment achieved high-single-digit growth, driven by new product expansion and enhanced product display strategies[12] - Revenue from modern channels remained stable year-on-year, with newly launched products contributing double-digit percentages to modern channel revenue[13] - Revenue from the rice crackers segment increased by 5.1% year-on-year, reaching RMB1,972.0 million, with core-brand rice crackers growing by 4.4%[20] - Revenue from the dairy products and beverages segment decreased by 13.2% year-on-year to RMB5,693.0 million, primarily due to pandemic impacts[20] - Revenue from popsicles achieved approximately RMB200 million in the first half of 2022FY, marking a new sales peak, driven by innovative packaging and marketing campaigns[21] Cost and Margin Analysis - Gross profit declined by 12.9% year-on-year to RMB4,638.4 million[22] - The gross profit margin for the rice crackers segment was 37.2%, down 3.8 percentage points year-on-year, primarily due to a more than 40% increase in palm oil costs[22] - The gross profit margin for dairy products and beverages was 45.3% in the first half of 2022FY, a year-on-year decrease of 4.1 percentage points, primarily due to a 21% increase in whole milk powder costs[23] - The gross profit margin for snack foods was 42.2% in the first half of 2022FY, representing a year-on-year decrease of 2.4 percentage points, attributed to rising costs of white sugar, skimmed milk powder, and plastic pellets[23] Operational Adjustments - The Group improved its supply chain contingency mechanism to ensure smooth production and operations[8] - The international supply chain recovery drove growth in overseas revenue[9] - Marketing investments were increased in store scenarios and product displays to adapt to changing market conditions[8] - The Group will continue to monitor the pandemic's impact on sales and adjust strategies accordingly[9] - The Group plans to continue launching high-quality new products to cater to differentiated consumer needs[16] Cash Flow and Financial Position - As of September 30, 2022, the Group's net cash was RMB7,137.0 million, a decrease of RMB2,963.6 million from March 31, 2022, primarily due to dividend payments totaling RMB4,144.2 million[24] - Cash and bank deposits amounted to RMB13,258.6 million as of September 30, 2022, a decrease of RMB3,744.2 million from March 31, 2022, mainly due to dividend payments[24] - Net cash inflow from operating activities for the first half of FY2022 was RMB1,908.1 million, with a profit before income tax of RMB2,150.2 million[25] - The net decrease in cash and cash equivalents was RMB 5,033,635, compared to a decrease of RMB 2,399,049 in the previous year, indicating a 109.1% increase in cash outflow[60] Dividend and Shareholder Returns - The Board recommended an interim dividend of US 1.14 cents per share for the first half of FY2022, totaling approximately US$135.5 million (equivalent to approximately RMB 919.5 million), representing a 37% increase compared to the interim dividend of US 0.83 cents per share for the first half of FY2021[35] - The final dividend for FY2021 was US 2.10 cents per share, amounting to approximately US$249.9 million (equivalent to approximately RMB 1,726.8 million)[35] - The special dividend for FY2021 was US 2.94 cents per share, amounting to approximately US$349.8 million (equivalent to approximately RMB 2,417.4 million)[35] Employee and Management Information - The average number of employees for the first half of FY2022 was approximately 41,040, a decrease of 225 employees compared to the average for the year ended 31 March 2022[35] - Total remuneration expenses for the first half of FY2022 amounted to RMB 2,239.4 million[35] - Total compensation for key management increased to RMB10,801,000 for the six months ended 30 September 2022, up from RMB8,191,000 in the same period of 2021[145] Share Capital and Ownership - As of September 30, 2022, the total issued share capital of the company is 11,899,528,135 shares[162] - Tsai Eng-Meng holds 177,000,000 shares, representing approximately 53.12% of the company's issued share capital[156] - The company repurchased a total of 15,800,000 shares for an aggregate amount of HK$81,166,070, which were subsequently cancelled[163] Risk Management and Compliance - The Group's foreign exchange risks mainly arise from procurement of raw materials and equipment from overseas, overseas dividend payments, and certain recognised assets or liabilities[35] - The Group's financial risk management policies remained unchanged since the last year-end[68] - The Group utilized a certain amount of hedging products to address possible foreign exchange risk during the first half of FY2022[35]

Company Overview - Want Want China Holdings Limited is listed on The Stock Exchange of Hong Kong Limited with stock code 0151[4] - The company's executive directors include Mr. Tsai Eng-Meng (Chairman and CEO), Mr. Tsai Shao-Chung, Mr. Tsai Wang-Chia (COO), Mr. Huang Yung-Sung (CMO), and Mr. Chu Chi-Wen (CFO)[4] - The company's principal place of business and headquarters address is at Units 07-08, 7th Floor, FTLife Tower, No. 18 Sheung Yuet Road, Kowloon Bay, Kowloon, Hong Kong[6] - The company's website is www.want-want.com[6] - The company's auditor is Ernst & Young Certified Public Accountants[5] - The company's legal advisor is Sullivan & Cromwell (Hong Kong) LLP[5] - The company's principal banks include Bank of China (Hong Kong) Limited, China Merchants Bank Co., Limited, Citigroup Inc., and CTBC Bank Co., Ltd, Hong Kong Branch[5] - The company's registered office is at Maples Corporate Services Limited, P.O. Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands[6] - The company's share registrar and transfer office is Suntera (Cayman) Limited, Suite 3204, Unit 2A, Block 3, Building D, P.O. Box 1586, Gardenia Court, Camana Bay, Grand Cayman, KY1-1100, Cayman Islands[6] - The company's Hong Kong branch share registrar and transfer office is Computershare Hong Kong Investor Services Limited, Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong[6] Business Operations - The company has 422 sales offices, 35 production bases, and 81 factories in the Chinese mainland as of March 31, 2022, and collaborates with over 10,000 distributors[8] - The company's Vietnam production base began construction in 2020 to support overseas market expansion and future development strategies[7] - The company's principal activities include manufacturing, distribution, and sale of rice crackers, dairy products, beverages, snack foods, and other products[8] - The company's operations are primarily located in the Chinese mainland, with exports to North America, East Asia, Southeast Asia, and Europe[8] - The company was listed on the Hong Kong Stock Exchange on March 26, 2008, and previously listed on the Singapore Exchange Securities Trading Limited in 1996 before delisting in 2007[7] - The company introduced the "Want Want" brand in the Chinese mainland in 1989 and established its first subsidiary in Hunan province in 1992[7] - The company transitioned from a rice cracker-focused business to a diversified food and beverages company in the years following its establishment in 1962[7] Corporate Culture and Activities - The company held a new corporate theme song contest in 2021 to strengthen team spirit and communication with distributors[12] - The company organizes traditional Chinese festive activities annually to improve team cohesion and employee belonging[15] - The company held the Want Want Family Day to enhance communication with employees and their families, showcasing employee achievements and building a positive corporate culture[16] Financial Performance - Revenue for the year ended March 31, 2022, reached RMB 23,984,891 thousand, a 9.0% increase from the previous year[33] - Profit for the year ended March 31, 2022, was RMB 4,189,114 thousand, a 1.0% increase from the previous year[33] - EBITDA for the year ended March 31, 2022, was RMB 5,734,383 thousand, a 4.3% decrease from the previous year[33] - Basic earnings per share for the year ended March 31, 2022, were RMB 35.16 cents, a 3.9% increase from the previous year[33] - Total assets as of March 31, 2022, were RMB 29,857,981 thousand, a 4.4% decrease from the previous year[34] - Total equity as of March 31, 2022, was RMB 16,708,778 thousand, an 11.6% increase from the previous year[34] - Total liabilities as of March 31, 2022, were RMB 13,149,203 thousand, a 19.2% decrease from the previous year[34] - Dividends for the year ended March 31, 2022, amounted to RMB 4,691,334 thousand, a 174.3% increase from the previous year[33] - Shares buy-back for the year ended March 31, 2022, totaled RMB 819,493 thousand, a 48.8% decrease from the previous year[33] - Return on equity for the year ended March 31, 2022, was calculated based on profit attributable to equity holders of the Company divided by the average of the opening and closing balances of the equity[32] - Revenue for the 2021 fiscal year reached RMB 23,984.9 million, representing a growth of over 100 times compared to the annual revenue before the company's investment in the Chinese mainland[36] Awards and Recognitions - The export product Pea Crisp (Apple Cinnamon Flavour) won the 2021 Monde Selection Gold Quality Award in April 2021[37] - The Hot-Kid Occupational Cans marketing proposal won the 9th TopDigital Innovative Marketing Award – IP Marketing – Gold Award in July 2021[38] - The collaboration between Want Want and NetEase Music "Sounds Delicious" won the Cross-Industry Joint Marketing Gold Award at the 12th Golden Mouse Digital Marketing Awards in April 2021[39] - Want Want Rice Prawn Chips won "The Best Flavour Snack" at the 3rd iSEE Innovation Award in May 2021[41] - Research on key technology of active lactoferrin yogurt won the Second Prize of the Technical Progress Award from the China Dairy Industry Association in September 2021[42] - Want Want Group won the Special Contribution Award of the China Food Health Seven Star Award for the seventh time in September 2021[43] - The research and application of lactoferrin detection technology in fermented milk won the Second Prize of the Science and Technology Award from the China Food Industry Association in December 2021[43] - Want Want ranked third in the list of "Taiwan Top 25 International Brands" in December 2021[44] Revenue and Profit Analysis - Group revenue reached a record high of RMB 23,984.9 million, a 9.0% year-on-year increase[46][47][48][49] - Revenue from key product segments: Rice crackers RMB 5,592.3 million (↑0.2%), Daily products & beverages RMB 12,873.5 million (↑16.9%), Snack foods RMB 5,397.2 million (↑1.6%)[46][47] - Emerging channels contributed approximately 40% of revenue, with new products playing a significant role[46][47] - Profit attributable to equity holders of the Company increased by 1.1% to RMB 4,202.7 million[46][47][48][49] - Gross profit margin decreased by 3.4 percentage points to 44.8% due to rising raw material and packaging costs[48][49] - Operating profit decreased by 4.9% to RMB 5,456.8 million, but remained nearly flat year-on-year excluding one-off gains from the previous year[49] - Total dividends for 2021FY amounted to USD 699 million, including interim, final, and special dividends[46][47] - Overseas markets returned to mid-to-high single-digit year-on-year revenue growth as supply chain pressures eased[49] - Traditional channels contributed approximately 80% of revenue, while modern and emerging channels showed high-single and double-digit growth respectively[46][47] - The Group will continue to monitor external environmental changes and manage cost risks to maintain healthy development[49] - Revenue from traditional channels achieved a high single-digit year-on-year growth in 2021FY[51] - Revenue from modern channels achieved a near high single-digit growth in 2021FY, driven by new products and convenience store channels[51] - Emerging channels contributed close to a double-digit percent of the Group's overall revenue in 2021FY, with 40% of revenue from new products launched in the past three years[52] - Revenue from vending machines doubled in 2021FY compared to the previous financial year[54] - Overseas sales in 2021FY saw a mid-to-high single-digit growth rate in the second half, with double-digit growth excluding exchange rate effects[55] - The factory in Vietnam is expected to commence production in mid-2022, with new offices in Southeast Asia already operational[55] Product and Brand Development - The Group launched several new brands, including "Baby Mum-Mum," "Mr. Bond," "Fix x Body," "Queen Alice," "Mr. Hot," "Got Rice," and "Prime of Love"[59][60] - The Group's B2B model includes online/offline cooperation, self-developed e-shopping mall, maternity channels, OEM business channels, and special channels[53] - The Group's B2C model includes self-operated online flagship stores, vending machines, and theme stores[54] - The Group aims to develop suitable products for local consumers' preferences in overseas markets[55] - Total revenue for the 2021FY grew by 9.0% year-on-year, reaching RMB23,984.9 million[63] - Revenue from the dairy products and beverages segment increased by 16.9% year-on-year, with double-digit growth in both halves of the year[63] - Revenue from the rice crackers segment remained flat year-on-year, with a low-to-mid single-digit growth in the second half of the year[63] - Revenue from the snack foods segment grew by 1.6% year-on-year, with mid-to-high single-digit growth in the second half of the year[63] - Revenue from "Hot-Kid Milk" accounted for over 90% of the dairy products and beverages segment, recording a year-on-year growth rate of 18.4%[67] - New products introduced in the past three years accounted for nearly a double-digit percentage of the Group's total revenue in the 2021FY[61] - Revenue from the candies sub-category increased by 5.1% year-on-year, with significant growth in emerging channels[69] - Overseas sales of rice crackers, which accounted for approximately 20% of the segment revenue, resumed a mid-single digit growth in the second half of the year[65] - New products under the "Got Rice" brand, such as "Want Want Donuts" and "Crispy Rice Chips," were launched to meet health demands[66] - The Group launched new dairy products like "Hot-Kid Chocolate Milk" and "Nut Milk," which together contributed sales of over RMB100 million in the 2021FY[68] - Revenue from the popsicles sub-category grew by 2.7% year-on-year in the 2021FY, with "Dongchi" exceeding annual sales of RMB200 million[72] - The social media campaign "Have a craving for Dongchi" generated over 220 million views, contributing to the brand's success[72] Cost and Profit Margins - The cost of sales for the Group in the 2021FY increased by 16.2% year-on-year to RMB13,237.5 million, driven by double-digit increases in key raw material costs[72] - Gross profit margin for the Group decreased by 3.4 percentage points to 44.8% in the 2021FY, with gross profit increasing by 1.3% year-on-year to RMB10,747.4 million[73] - The rice crackers segment's gross profit margin decreased by 4.7 percentage points to 41.4% in the 2021FY, primarily due to rising palm oil costs[73] - The dairy products and beverages segment's gross profit margin decreased by 2.9 percentage points to 46.7% in the 2021FY, mainly due to increased costs of tinplate and whole milk powder[73] - The snack foods segment's gross profit margin decreased by 3.5 percentage points to 44.2% in the 2021FY, driven by higher costs of paper and plastic pellets[73] - The Group launched several new products in the snack foods segment, including "fruit-flavored aerated gummies," "Hot-Kid Super QQ," "YA-MI Sandwich Bun," and "Jelly Jelly," which features low-sugar, low-calorie, and collagen peptides[72] - The Group is optimizing production processes and diversifying channels to maintain healthy profitability in the dairy products and beverages segment[73] - The Group is focusing on product upgrades and introducing high-margin new products to sustain profitability in the snack foods segment[73] Expenses and Profitability - Distribution costs increased by RMB367.6 million (13.3% YoY) to RMB3,133.2 million, accounting for 13.1% of revenue, up 0.5 percentage points YoY[74] - Administrative expenses rose by RMB21.30 million (0.8% YoY) to RMB2,734.7 million, but decreased as a percentage of revenue by 0.9 percentage points to 11.4%[74] - Operating profit decreased by 4.9% YoY to RMB5,456.8 million, with an operating profit margin of 22.8%, due to a 3.4 percentage point decline in gross profit margin[74] - Income tax expense for 2021FY was RMB1,545.3 million, with an income tax rate of 26.9%, down 3.9 percentage points YoY[74] - Profit attributable to equity holders increased by 1.1% YoY to RMB4,202.7 million, but the margin decreased by 1.4 percentage points to 17.5%[74] Cash Flow and Financial Position - Net cash increased by RMB1,002.6 million to RMB10,100.6 million as of 31 March 2022, driven by RMB3,910.5 million net cash generated from operating activities[76] - Cash and bank deposits (including long-term deposits) decreased by RMB1,928.3 million to RMB17,002.8 million as of 31 March 2022, with RMB accounting for 85.1%[76] - Total borrowings decreased by RMB2,930.9 million to RMB6,902.2 million as of 31 March 2022, mainly due to repayment of USD-denominated borrowings[76] - Short-term borrowings increased by RMB15.89 million to RMB3,355.9 million, while long-term borrowings decreased by RMB2,946.8 million to RMB3,546.4 million[76] - The Group repaid USD500 million bonds in full upon maturity in April 2022, with a balance of USD499.9 million as of 31 March 2022[76] - Net gearing ratio as of 31 March 2022 was -0.61 times, unchanged from 31 March 2021[78] - Net cash inflow from operating activities was RMB 3,910.5 million, driven by profit before income tax of RMB 5,734.4 million[78] - Cash outflow for financing activities was RMB 5,342.4 million, including RMB 2,642.6 million for repayment of USD-denominated borrowings[78] - Cash and cash equivalents as of 31 March 2022 amounted to RMB 11,055.8 million, with total liquidity of RMB 17,002.8 million including long-term deposits[78] - Capital expenditure for FY2021 was RMB 460.5 million, with significant investments in production plant expansions in Vietnam[78] Inventory and Turnover - Inventory as of 31 March 2022 increased to RMB 3,226.2 million, up by RMB 697.4 million compared to 2021, while inventory turnover days decreased by 6 days[82][83] - Trade receivables turnover days remained stable at 15 days for both 2021 and 2022[89] - Trade payables turnover days improved to 28 days in 2022 from 33 days in 2021[89] Employee and Compensation - Average number of employees in FY2021 was 41,265, with total employee compensation of RMB 4,403.4 million[90] - The average number of employees in 2021FY was 41,265, an increase of 72 employees compared to the previous year[91] - Total remuneration expenses for 2021FY amounted to RMB4,403.4 million[91] Foreign Exchange and Dividends - The Group's foreign exchange risks mainly arise from overseas procurement of raw materials and equipment, overseas dividend payments, and certain recognized assets or liabilities[92] - The Group did not hedge against its foreign exchange risks during the 2021FY[93] - The Board recommended a final dividend of US2.10 cents per share for the 2021FY, amounting to approximately US$250 million (RMB1,692 million)[95] - The Board also recommended a special dividend of US2.94 cents per share for the 2021FY, amounting to approximately US$350 million (RMB2,369 million)[95] - Total dividends for the 2021FY would be US5.87 cents per share, amounting to approximately US$699 million, representing a 174% increase compared to the 2020FY[95] - The Group returned a total of approximately US$826 million (RMB5,510 million) to its shareholders in 2021FY, including dividends and share repurchases, representing a 67% increase compared to the 2020FY[95] - The Group's total return to shareholders in 2021FY represented approximately 131% of the profit attributable to equity holders[95] - The Group's functional currency is USD, while the presentation currency is RMB, with over 90% of operating activities conducted in the Chinese mainland[92] Board and Governance - The Board consists of 15 Directors, including 7 executive Directors, 3 non-executive Directors, and 5 independent non-executive Directors as of 31 March 2022[102] - The Board is responsible for overseeing the Group's operating and financial performance, approving annual budgets, financial results, major investments, and material contracts[101] - The Board has delegated specific responsibilities to committees including Audit and Risk Management, Remuneration, Nomination, and Strategy Committees[101] - The ESG Committee was established in August 2020 to assist the Board in managing environmental, social, and governance matters[101] - The Board

Financial Performance - For the six months ended September 30, the company reported a revenue of approximately HKD 3.5 billion, representing a year-on-year increase of 12%[8]. - The net profit for the same period was approximately HKD 1.2 billion, reflecting a growth of 15% compared to the previous year[8]. - Total revenue for the first half of FY2021 reached RMB 11,382.6 million, representing a year-on-year increase of 10.5%[15]. - Operating profit amounted to RMB 2,780.6 million, with an operating profit margin of 24.4%, a decrease of 20 basis points compared to the previous year[12]. - Profit attributable to equity holders of the Company increased by 7.1% year-on-year to RMB 2,090.0 million, with a profit margin of 18.4%[17]. - Profit for the period reached RMB 2,083,788, a rise of 7.0% from RMB 1,946,691 in 2020[120]. - Basic earnings per share for equity holders was RMB 17.32, up from RMB 15.75, indicating a 10.1% increase[118]. Revenue Breakdown - Revenue from rice crackers decreased by 5.8% to RMB 1,876.2 million, while dairy products revenue increased by 23.5% to RMB 6,561.8 million[13]. - Revenue from modern channels achieved double-digit growth, driven by improved customer and supply chain management[20]. - Revenue from the dairy products and beverages segment grew by 23.5% year-on-year to RMB 6,561.8 million, with "Hot-Kid Milk" accounting for over 90% of this revenue and achieving a growth rate of 23.9%[55]. - Revenue from the rice crackers segment decreased by 5.8% year-on-year to RMB 1,876.2 million, primarily due to a double-digit decline in overseas business impacted by the pandemic[51]. - Snack foods revenue declined by 2.6% year-on-year to RMB 2,873.9 million, attributed to a high base figure from the previous year due to pandemic-related shipment delays[60]. Market and Product Development - The company’s market share in the snack food segment increased to 25%, up from 22% in the previous year[8]. - User engagement metrics showed a 20% increase in online sales, driven by enhanced digital marketing strategies[8]. - The company plans to launch three new product lines in the next quarter, focusing on health-oriented snacks[8]. - New product innovations include "Hot-Kid Chocolate Milk" and various themed packaging designs, which have drawn significant consumer attention[41][43]. - The Group's overseas sales declined in the first half of FY2021 due to pandemic impacts, but plans to continue expanding its sales network internationally, with a factory in Vietnam expected to commence production in 2022[28][29]. Marketing and Consumer Engagement - A new marketing strategy will be implemented to enhance brand visibility and customer loyalty, with a budget increase of 20% allocated for digital campaigns[8]. - The Hot-Kid Club membership has exceeded 15 million, enhancing consumer interaction and brand loyalty through digital marketing strategies[36]. - The Group launched a series of creative marketing campaigns, including the "Want Want Day" event, to strengthen brand image and consumer engagement[37]. - The Group's digital marketing efforts have focused on emotional connection with consumers, optimizing private domain traffic management to increase user loyalty[42][44]. Cost and Profitability - The cost of sales for the first half of 2021FY amounted to RMB 6.0592 billion, representing a year-on-year increase of 13.6% due to rising costs of key raw materials[66][70]. - The gross profit margin decreased by 1.4 percentage points to 46.8%, while gross profit increased by 7.2% to RMB 5.3234 billion[67][71]. - The gross profit margin for the rice crackers segment was 41.0%, a decrease of 5.3 percentage points year-on-year, primarily due to increased raw material costs[68][72]. - Distribution costs increased by 14.2% to RMB 1.4268 billion, with distribution costs as a percentage of revenue rising to 12.5%[75]. Cash Flow and Financial Position - As of September 30, 2021, the Group's net cash was RMB 9,160.9 million, an increase of RMB 62.9 million from March 31, 2021, primarily due to net cash generated from operating activities of RMB 1,971.1 million[87]. - Total borrowings as of September 30, 2021, amounted to RMB 8,235.3 million, a decrease of RMB 1,597.8 million compared to March 31, 2021[88]. - Cash and cash equivalents as of September 30, 2021, totaled RMB 13,677.1 million, plus bank deposits with a term of more than three months of RMB 3,719.1 million, amounting to a total of RMB 17,396.2 million[88]. - The company reported a decrease in cash and bank balances to RMB 13,795,216 from RMB 17,339,163, reflecting a liquidity contraction[134]. Shareholder Returns - The Board recommended an interim dividend of US$0.83 cents per share, totaling approximately US$99 million (RMB637 million), representing a 16.4% increase compared to the previous year's total of approximately US$177 million (RMB1,225 million) for dividends and share repurchases[106][108]. - Total amount returned to shareholders, including share repurchases, was approximately US$206 million (RMB1,329 million) for the first half of FY2021[106]. - The company acquired 150,759,000 of its own shares during the six months ended September 30, 2021, compared to 140,872,000 shares in the same period of 2020[194]. - The total amount paid for the share buy-back was RMB 692,018,000 for the six months ended September 30, 2021, an increase from RMB 669,510,000 in the same period of 2020[195].

Financial Performance - The company reported a revenue of HKD 4.5 billion for the fiscal year, representing a year-over-year increase of 10%[5] - The net profit for the year was HKD 1.2 billion, which is a 15% increase compared to the previous year[5] - The company has set a performance guidance of 12% revenue growth for the upcoming fiscal year[5] - In FY2020, revenue increased by 9.5% year-on-year to RMB21,998 million, while net profit attributable to equity holders rose by 13.9% to RMB4,158 million[46] - Operating profit for FY2020 grew by 19.4% year-on-year, reaching RMB5,736 million[46] - The profit for the year in FY2021 was RMB4,147,681, compared to RMB3,636,243 in FY2020[43] Market Expansion and Strategy - User data showed a growth in active customers by 20%, reaching 1.5 million users[5] - The company plans to expand its market presence in Southeast Asia, targeting a 25% increase in market share over the next two years[5] - New product launches are expected to contribute an additional HKD 500 million in revenue next year[5] - The company aims to leverage both online and offline channels to launch new products and enhance growth opportunities[47] - The company has diversified its product offerings to include rice crackers, dairy products, beverages, and snack foods[18] - The company has expanded its market reach to include exports to North America, East Asia, Southeast Asia, and Europe[18] Research and Development - The company has invested HKD 300 million in R&D for new technologies aimed at improving product quality and sustainability[5] - The Group has applied for 96 patents, with 75 patents awarded, including 17 related to energy saving, emission reduction, and environmental protection[86] - The Group's R&D emphasizes the development of functional products that cater to diverse consumer health needs[97] Sustainability and Environmental Initiatives - Environmental initiatives are being prioritized, with a commitment to reduce carbon emissions by 30% over the next five years[5] - The cumulative investment in upgrading environmental protection technologies reached RMB 211 million, demonstrating the company's commitment to sustainability[73] - The Group aims to improve energy and water efficiency by 10% and reduce greenhouse gas emissions density by 13% over the next five years, in line with the National 14th Five-Year Plan and Vision 2035[86] - The Group is committed to sustainability in packaging materials, focusing on carbon reduction, lightweight, recycling, and degradation[97] - The Group prioritizes the use of FSC-certified Tetra Pak packaging materials, resulting in the sustainable management of 4,834 hectares (72,508 acres) of forest due to the procurement of 4.15 billion paper packs in 2020[124] Quality and Safety Management - The company emphasizes the importance of product quality and consumer trust as its top competitive advantage[48] - The Group has implemented a WSQM system that integrates GFSI requirements and is based on HACCP principles for food safety management[96] - The Group conducts annual simulation recall exercises at all production bases, ensuring effective monitoring of the production and sales process[153] - The Group's complaint handling system is guided by the "Action Procedures for Customers' complaint," ensuring effective resolution of customer issues[148] Employee Engagement and Management - As of March 31, 2021, the Group had 39,132 employees, with 55% being female and 45% male[79] - The Group emphasizes a people-oriented management philosophy, valuing relationships and talent acquisition[25] - The Group has established various employee welfare programs, including festival benefits, wedding gifts, and commercial insurance, to enhance employee satisfaction and well-being[181] - The Group conducts exit interviews to understand the reasons for employee resignations and gather feedback for improving workplace satisfaction[195] - The Group promotes a fair employment principle, ensuring no discrimination based on age, gender, nationality, or other factors[190] Awards and Recognition - The company was recognized as one of Taiwan's top 25 international brands, ranking third in November 2020[50] - The company won multiple awards at the 12th Golden Mouse Digital Marketing Contest, including a Gold Award for cross-industry joint marketing[58][59] - The "Aiyo Rice Noodles Series" key technology and industrialization research won the third prize of the Technology Innovation Award, while the electrolysis functional water technology received the second prize of the Technology Progress Award[54][55]

[Corporate Information](index=4&type=section&id=Corporate%20Information) This section provides fundamental company details, including legal name, listing information, and professional advisors [Company Overview](index=4&type=section&id=Company%20Overview) This section provides basic company information, including legal name, listing location and code, and company website - The company's legal name is **Want Want China Holdings Limited**[5](index=5&type=chunk) - The company is listed on The Stock Exchange of Hong Kong Limited, stock code **0151**[5](index=5&type=chunk) - The company's website is **www.want-want.com**[7](index=7&type=chunk) [Board of Directors and Committees](index=4&type=section&id=Board%20of%20Directors%20and%20Committees) This section lists board members and their roles, detailing the composition of key committees - Executive Directors include Mr. Tsai Eng-Meng (Chairman and CEO), Mr. Tsai Shao-Chung, Mr. Tsai Wang-Chia (COO), Mr. Huang Yung-Sung (CMO), Mr. Chu Chi-Wen (CFO), Ms. Lai Hong-Yi, and Mr. Tsai Ming-Hui[5](index=5&type=chunk) - The Environmental, Social and Governance Committee was established on **August 18, 2020**, with Mr. Tsai Wang-Chia as Chairman[6](index=6&type=chunk) [Professional Advisors and Registrars](index=5&type=section&id=Professional%20Advisors%20and%20Registrars) This section provides detailed information on the company's auditor, legal counsel, principal bankers, share registrar, and registered office - The company's auditor is **PricewaterhouseCoopers**[6](index=6&type=chunk) - Principal bankers include Bank of China (Hong Kong) Limited, China Merchants Bank Co., Ltd., Citigroup, and CTBC Bank Co., Ltd. Hong Kong Branch[6](index=6&type=chunk) - The Hong Kong share registrar is **Computershare Hong Kong Investor Services Limited**[7](index=7&type=chunk) [Financial Highlights](index=7&type=section&id=Financial%20Highlights) This section summarizes key financial performance indicators, ratios, and operating metrics for the reporting period [Key Income Statement Items](index=7&type=section&id=Key%20Income%20Statement%20Items) For the six months ended September 30, 2020, the company achieved significant year-on-year growth in revenue, gross profit, operating profit, and profit attributable to equity holders Key Income Statement Items (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 10,299,247 | 9,304,071 | +10.7 | | Gross Profit | 4,963,652 | 4,550,046 | +9.1 | | Operating Profit | 2,534,882 | 2,053,767 | +23.4 | | Profit attributable to equity holders of the Company | 1,952,396 | 1,614,913 | +20.9 | [Key Financial Ratios](index=7&type=section&id=Key%20Financial%20Ratios) For the six months ended September 30, 2020, the company's operating profit margin and profit attributable to equity holders margin both improved, despite a slight decrease in gross profit margin Key Financial Ratios (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (%) | As of Sep 30, 2019 (%) | Change (percentage points) | | :--- | :--- | :--- | :--- | | Gross Profit Margin | 48.2 | 48.9 | -0.7 | | Operating Profit Margin | 24.6 | 22.1 | +2.5 | | Profit attributable to equity holders of the Company Margin | 19.0 | 17.4 | +1.6 | [Key Operating Ratios](index=7&type=section&id=Key%20Operating%20Ratios) For the six months ended September 30, 2020, the company's inventory, trade receivables, and trade payables turnover days remained stable compared to the year ended March 31, 2020 Key Operating Ratios | Indicator | As of Sep 30, 2020 (days) | As of Mar 31, 2020 (days) | | :--- | :--- | :--- | | Inventory Turnover Days | 91 | 90 | | Trade Receivables Turnover Days | 16 | 17 | | Trade Payables Turnover Days | 38 | 37 | [Management Discussion and Analysis](index=8&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's perspective on the company's financial performance, operational strategies, and future outlook [Overall Performance Overview](index=8&type=section&id=Overall%20Performance%20Overview) For the six months ended September 30, 2020, the Group achieved significant year-on-year growth in total revenue and operating profit, driven by channel diversification and multi-brand strategies - For the six months ended September 30, 2020, the Group's total revenue reached **RMB 10,299 million**, a year-on-year increase of **10.7%**[11](index=11&type=chunk) - Operating profit reached **RMB 2,535 million**, a year-on-year increase of **23.4%**, with an operating profit margin of **24.6%**[11](index=11&type=chunk) - New products contributed a **mid-to-high single-digit percentage** to total revenue[12](index=12&type=chunk) [Channel Diversification](index=10&type=section&id=Channel%20Diversification) The Group achieved robust growth by refining traditional channels, expanding emerging channels, and continuously developing overseas markets - Traditional channel revenue growth accelerated year-on-year since 2016, with a **double-digit increase** in the first half of fiscal year 2020, driven by market order control and optimized distributor policies[18](index=18&type=chunk)[20](index=20&type=chunk) - Emerging channels continued high-speed growth, contributing a **mid-to-high single-digit percentage** to the Group's total revenue in the first half of fiscal year 2020, with over **5,500 vending machines** and approximately **110 themed stores** deployed[21](index=21&type=chunk)[23](index=23&type=chunk) - Despite global pandemic impacts, overseas market sales grew by a **mid-single-digit percentage** year-on-year in the first half of fiscal year 2020, with products sold to over **60 countries and regions**[26](index=26&type=chunk)[28](index=28&type=chunk) [Product Differentiation Strategy](index=14&type=section&id=Product%20Differentiation%20Strategy) The Group employs a multi-brand strategy to meet diverse consumer needs, continuously innovating with nutritious and functional new products, combined with digital marketing and distinctive packaging - The Group launched multiple brands, such as "Bebemama" (infant complementary food), "Bond" (youthful beverages), and "Fix x Body" (health and nutrition), to meet the personalized needs of consumers across different age groups[32](index=32&type=chunk) - Continuous development of low-calorie nutritional meal replacements, nutrient-rich, and functional new products, along with digital marketing activities like "QQ Brother" videos and "Want Want Frozen Chi" influencers, stimulates new demand[33](index=33&type=chunk)[34](index=34&type=chunk) - Product packaging is designed to integrate brand IP images and cater to channel display characteristics, attracting consumer attention[35](index=35&type=chunk) [Creative Digital Marketing](index=16&type=section&id=Creative%20Digital%20Marketing) The Group utilizes creative and diversified digital marketing activities, leveraging current trends to strengthen brand image, enhance consumer interaction, increase product exposure, and build a "Wang Zai Club" fan ecosystem - The launch of topical products and marketing campaigns like "Wang Zai Milk Professional Cans," "Wang Zai Masks," and "Want Want Health Boost Packs" conveys a positive brand image[39](index=39&type=chunk)[41](index=41&type=chunk) - A collaboration with NetEase Cloud Music, "Listen to music to earn Yunbei, redeem snacks at offline vending machines," drives online-to-offline traffic and boosts growth for emerging channels[40](index=40&type=chunk)[42](index=42&type=chunk) - Focusing on consumer experience, the Group is dedicated to building a "Wang Zai Club" fan base, fostering a fan ecosystem to enhance user stickiness[38](index=38&type=chunk) [Digitalized Operation and Management](index=18&type=section&id=Digitalized%20Operation%20and%20Management) The Group continues to advance digitalization to enhance consumer understanding, improve channel management, and optimize supply chain efficiency, driving sustainable growth and achieving cost reduction and efficiency gains - Digitalization aims to enhance consumer understanding, improve channel management capabilities, and supply chain efficiency, driving the Group's sustainable growth[44](index=44&type=chunk) - Information systems and multi-dimensional data analysis enable management to more agilely identify market opportunities, review management weaknesses, enhance channel management efficiency, and optimize production layout and supply chain management, continuously reducing costs and increasing efficiency[44](index=44&type=chunk) - Future plans include further strengthening regional collaborative management, improving responsiveness to emergencies, and applying digitalization to product R&D and sales management to enhance operational precision[44](index=44&type=chunk) [Revenue Performance by Product Segment](index=18&type=section&id=Revenue%20Performance%20by%20Product%20Segment) For the six months ended September 30, 2020, all three major product categories (rice crackers, dairy and beverages, snack foods) achieved strong year-on-year growth, with snack foods growing the fastest, demonstrating the Group's focus on balanced product development Revenue by Product Category (First Half of Fiscal Year 2020) | Product Category | As of Sep 30, 2020 (RMB'000) | Year-on-Year Growth (%) | % of Total Revenue | | :--- | :--- | :--- | :--- | | Rice Crackers | 1,992,300 | +9.4 | 19.3 | | Dairy and Beverages | 5,315,000 | +7.4 | 51.6 | | Snack Foods | 2,952,000 | +17.7 | 28.7 | - Rice cracker revenue increased by **9.4%** year-on-year, with main brand rice cracker revenue growing by **6.5%** to a record high, driven by channel penetration, market promotion, and new product development (e.g., "Bebemama" organic rice crackers)[45](index=45&type=chunk)[46](index=46&type=chunk) - Dairy and beverage revenue increased by **7.4%** year-on-year, with "Wang Zai Milk" growing by **7.0%** and other beverages growing by **13.3%**, while "O-Pao" lactic acid bacteria beverage sales exceeded **RMB 100 million** in three months[49](index=49&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk) - Snack food revenue increased by **17.7%** year-on-year, with ice products, candies, beans/jellies, and others growing by **22.5%**, **22.8%**, and **11.9%** respectively, primarily due to strengthened channel inventory management and new product launches[52](index=52&type=chunk)[53](index=53&type=chunk)[55](index=55&type=chunk) [Cost and Profitability Analysis](index=22&type=section&id=Cost%20and%20Profitability%20Analysis) Despite a slight decrease in gross profit margin due to rising raw material costs, the Group achieved significant operating profit growth through effective control of distribution and administrative expenses, reaching an operating profit margin of 24.6% - Cost of sales increased by **12.2%** year-on-year to **RMB 5,335.6 million**, primarily due to higher prices for key raw materials such as milk powder and sugar[56](index=56&type=chunk) - Gross profit margin decreased by **0.7 percentage points** to **48.2%** compared to the same period last year, but gross profit amount increased by **9.1%** to **RMB 4,963.7 million** due to revenue growth[58](index=58&type=chunk) - Distribution costs decreased by **8.8%** to **RMB 1,249.9 million**, with its ratio to revenue decreasing by **2.6 percentage points** to **12.1%**, mainly due to lower advertising and promotion expenses and staff costs[59](index=59&type=chunk)[63](index=63&type=chunk) - Operating profit increased by **23.4%** year-on-year to **RMB 2,534.9 million**, with an operating profit margin of **24.6%**[61](index=61&type=chunk)[65](index=65&type=chunk) - Profit attributable to equity holders of the Company increased by **20.9%** year-on-year to **RMB 1,952.4 million**, with a profit attributable to equity holders margin of **19.0%**[67](index=67&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) As of September 30, 2020, the Group maintained sufficient bank balances, but total borrowings increased, leading to a decrease in net cash, with a net debt-to-equity ratio of -0.51 times indicating a sound financial position - As of September 30, 2020, bank balances amounted to **RMB 17,339.2 million**, an increase of **RMB 82.2 million** from March 31, 2020[67](index=67&type=chunk) - Total borrowings were **RMB 10,218.3 million**, an increase of **RMB 1,337.7 million** from March 31, 2020, with short-term borrowings significantly increasing by **RMB 6,244.9 million**[67](index=67&type=chunk) - Net cash was **RMB 7,120.8 million**, a decrease of **15.0%** from March 31, 2020[67](index=67&type=chunk) - The net debt-to-equity ratio was **-0.51 times**, indicating the Group has ample cash and bank credit facilities[67](index=67&type=chunk) [Cash Flow and Capital Expenditure](index=25&type=section&id=Cash%20Flow%20and%20Capital%20Expenditure) For the six months ended September 30, 2020, net cash inflow from operating activities significantly increased, while net cash outflow from financing activities was primarily affected by dividend payments and share repurchases, with capital expenditure mainly for additions and upgrades to production plants and equipment - Net cash inflow from operating activities was **RMB 2,364.1 million**, a year-on-year increase of **22.2%**[68](index=68&type=chunk)[71](index=71&type=chunk) - Net cash outflow from financing activities was **RMB 2,031.6 million**, primarily comprising dividend payments of **RMB 2,990.2 million** and share repurchases of **RMB 669.5 million**[68](index=68&type=chunk)[71](index=71&type=chunk) - Total capital expenditure was **RMB 160.1 million**, mainly for additions and upgrades to production plants and equipment across the three major product categories[69](index=69&type=chunk)[72](index=72&type=chunk) [Working Capital Management](index=25&type=section&id=Working%20Capital%20Management) The Group's inventory turnover days and trade payables turnover days remained stable, while trade receivables turnover days slightly decreased, indicating efficient working capital management - As of September 30, 2020, inventory amounted to **RMB 2,636.4 million**, with inventory turnover days of **91 days**[73](index=73&type=chunk)[74](index=74&type=chunk) - Trade receivables turnover days were **16 days**, a slight decrease from **17 days** for the year ended March 31, 2020[78](index=78&type=chunk) - Trade payables turnover days were **38 days**, a slight increase from **37 days** for the year ended March 31, 2020[81](index=81&type=chunk) [Human Resources and Remuneration](index=27&type=section&id=Human%20Resources%20and%20Remuneration) For the six months ended September 30, 2020, the Group's average headcount decreased due to improved sales management efficiency, leading to a reduction in total remuneration expenses, while continuous investment in employee training enhances professional knowledge and skills - The average headcount was approximately **40,757**, a decrease of **1,815** from the year ended March 31, 2020, primarily due to enhanced sales management efficiency[82](index=82&type=chunk) - Total remuneration expenses were **RMB 1,837.8 million**, a year-on-year decrease of **2.0%**[82](index=82&type=chunk) - The Group consistently focuses on and invests resources in ongoing employee education and training programs[83](index=83&type=chunk) [Foreign Exchange Risks](index=27&type=section&id=Foreign%20Exchange%20Risks) The Group's foreign exchange risk primarily arises from overseas procurement, dividend payments, and asset/liability recognition, but the overall exposure is not significant due to most operations being in RMB in mainland China and USD borrowings being offset by USD functional currency subsidiaries, with no foreign currency hedging undertaken during the year - The Group's presentation currency is RMB, but the Company's functional currency remains USD, while mainland China subsidiaries' functional currency is RMB[84](index=84&type=chunk) - Foreign exchange risk primarily arises from overseas raw material and equipment procurement, overseas dividend payments, and certain recognized assets or liabilities[84](index=84&type=chunk) - Assets and liabilities involving foreign exchange risk are minimal, and the net exposure after offsetting is not significant, with no hedging of foreign currency exchange rate risk undertaken during the year[85](index=85&type=chunk) [Dividend Policy](index=28&type=section&id=Dividend%20Policy) The Board declared an interim dividend of 0.65 US cents per share for fiscal year 2020, reflecting the Group's policy of returning most free cash flow to shareholders through share repurchases and dividends, with total returns to shareholders significantly increasing by 77% compared to the same period last year - The Board declared an interim dividend of **0.65 US cents** per share for fiscal year 2020, approximately **US$79 million** (equivalent to approximately **RMB 555 million**)[88](index=88&type=chunk) - Including share repurchases, the total amount returned to shareholders was approximately **US$177 million** (equivalent to approximately **RMB 1,225 million**), a **77% increase** compared to the first half of fiscal year 2019[88](index=88&type=chunk) - The Group adheres to a policy of returning most free cash flow (after deducting necessary operating costs and capital expenditures) to shareholders through share repurchases and dividends[88](index=88&type=chunk) [Report on Review of Condensed Consolidated Interim Financial Information](index=27&type=section&id=Report%20on%20Review%20of%20Condensed%20Consolidated%20Interim%20Financial%20Information) This section presents the independent auditor's review report on the condensed consolidated interim financial information [Introduction and Responsibilities](index=27&type=section&id=Introduction%20and%20Responsibilities) PricewaterhouseCoopers has reviewed Want Want China Holdings Limited's condensed consolidated interim financial information for the six months ended September 30, 2020, prepared by the directors in accordance with HKAS 34 - PricewaterhouseCoopers has reviewed the condensed consolidated interim financial information for the six months ended September 30, 2020[91](index=91&type=chunk) - The company's directors are responsible for the preparation and presentation of this financial information in accordance with HKAS 34 "Interim Financial Reporting"[91](index=91&type=chunk) [Scope of Review](index=30&type=section&id=Scope%20of%20Review) The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is significantly narrower than an audit, thus no audit opinion is expressed - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Hong Kong Institute of Certified Public Accountants[93](index=93&type=chunk)[95](index=95&type=chunk) - The scope of a review is significantly narrower than an audit, and therefore no audit opinion is expressed[93](index=93&type=chunk)[95](index=95&type=chunk) [Conclusion](index=30&type=section&id=Conclusion) Based on the review, the auditor found no matters that lead them to believe the condensed consolidated interim financial information is not prepared, in all material respects, in accordance with HKAS 34 - The auditor found no matters that lead them to believe the condensed consolidated interim financial information is not prepared, in all material respects, in accordance with HKAS 34 "Interim Financial Reporting"[94](index=94&type=chunk)[96](index=96&type=chunk) [Interim Condensed Consolidated Balance Sheet](index=29&type=section&id=Interim%20Condensed%20Consolidated%20Balance%20Sheet) This section presents the Group's financial position, detailing assets, equity, and liabilities as of the reporting date [Assets](index=29&type=section&id=Assets) As of September 30, 2020, the Group's total assets slightly decreased, with reductions in non-current assets and inventories, while cash and cash equivalents remained stable Assets Overview | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, plant and equipment | 6,553,357 | 6,770,980 | | Right-of-use assets | 1,065,754 | 1,062,289 | | **Current Assets** | | | | Inventories | 2,636,409 | 2,746,167 | | Trade receivables | 933,562 | 846,744 | | Cash and cash equivalents | 17,339,163 | 17,256,927 | | **Total Assets** | 29,783,017 | 29,824,990 | [Equity](index=29&type=section&id=Equity) As of September 30, 2020, the Group's total equity decreased, primarily due to reductions in share capital and reserves, related to share repurchases and dividend payments during the period Equity Overview | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | Share capital | 1,847,089 | 1,866,355 | | Reserves | 12,008,039 | 13,406,327 | | Non-controlling interests | 76,551 | 81,532 | | **Total Equity** | 13,931,679 | 15,354,214 | [Liabilities](index=32&type=section&id=Liabilities) As of September 30, 2020, the Group's total liabilities significantly increased, mainly driven by a substantial rise in current borrowings, while non-current borrowings decreased considerably Liabilities Overview | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | **Non-current Liabilities** | | | | Borrowings | 3,386,378 | 8,293,566 | | **Current Liabilities** | | | | Trade payables | 1,146,928 | 1,093,092 | | Borrowings | 6,831,970 | 587,085 | | **Total Liabilities** | 15,851,338 | 14,470,776 | [Interim Condensed Consolidated Statement of Income](index=31&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Income) This section presents the Group's financial performance, including revenue, expenses, and net profit for the reporting period [Revenue and Gross Profit](index=31&type=section&id=Revenue%20and%20Gross%20Profit) For the six months ended September 30, 2020, the Group's revenue increased by 10.7% year-on-year, and gross profit increased by 9.1% year-on-year, demonstrating robust growth in top-line and core profitability Revenue and Gross Profit (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Revenue | 10,299,247 | 9,304,071 | | Cost of sales | (5,335,595) | (4,754,025) | | Gross Profit | 4,963,652 | 4,550,046 | [Operating Expenses and Profit](index=31&type=section&id=Operating%20Expenses%20and%20Profit) Despite a slight increase in administrative expenses, effective control over distribution costs and revenue growth collectively drove a significant 23.4% increase in operating profit Operating Expenses and Profit (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Distribution costs | (1,249,863) | (1,369,929) | | Administrative expenses | (1,304,081) | (1,285,660) | | Operating Profit | 2,534,882 | 2,053,767 | [Net Profit and Earnings Per Share](index=31&type=section&id=Net%20Profit%20and%20Earnings%20Per%20Share) Profit for the period and profit attributable to equity holders of the Company both increased by over 20%, with basic and diluted earnings per share rising accordingly Net Profit and Earnings Per Share (For the six months ended September 30) | Indicator | As of Sep 30, 2020 | As of Sep 30, 2019 | | :--- | :--- | :--- | | Profit for the period (RMB'000) | 1,946,691 | 1,604,849 | | Profit attributable to equity holders of the Company (RMB'000) | 1,952,396 | 1,614,913 | | Basic earnings per share (RMB cents) | 15.75 | 12.99 | | Diluted earnings per share (RMB cents) | 15.75 | 12.99 | [Interim Condensed Consolidated Statement of Comprehensive Income](index=32&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) This section presents the Group's total comprehensive income, including profit for the period and other comprehensive income items [Profit and Other Comprehensive Income](index=32&type=section&id=Profit%20and%20Other%20Comprehensive%20Income) For the six months ended September 30, 2020, the Group's total comprehensive income for the period significantly increased, primarily due to higher profit for the period and a positive shift in currency translation differences Profit and Other Comprehensive Income (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Profit for the period | 1,946,691 | 1,604,849 | | Currency translation differences | 283,868 | (366,957) | | Changes in fair value of financial assets at fair value through other comprehensive income | 6,699 | (959) | | **Total comprehensive income for the period** | 2,237,258 | 1,236,926 | - Total comprehensive income for the period attributable to equity holders of the Company increased from **RMB 1,248,039 thousand** in 2019 to **RMB 2,242,140 thousand** in 2020[108](index=108&type=chunk) [Interim Condensed Consolidated Statement of Changes in Equity](index=33&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) This section details the changes in the Group's equity components, including share capital, reserves, and non-controlling interests [Equity Movements (2020)](index=33&type=section&id=Equity%20Movements%20(2020)) For the six months ended September 30, 2020, the Group's total equity decreased due to dividend payments and share repurchases, partially offset by total comprehensive income for the period Equity Movements (First Half of 2020) | Indicator | As of Apr 1, 2020 (RMB'000) | As of Sep 30, 2020 (RMB'000) | | :--- | :--- | :--- | | Total equity at beginning of period | 15,354,214 | | | Total comprehensive income for the period | 2,237,258 | | | 2019 final dividend paid | (2,990,283) | | | Share repurchases | (669,510) | | | Total equity at end of period | | 13,931,679 | - Share repurchases amounted to **RMB 669,510 thousand**, resulting in a decrease of **RMB 19,266 thousand** in share capital and **RMB 650,244 thousand** in retained earnings[112](index=112&type=chunk)[177](index=177&type=chunk) [Equity Movements (2019)](index=36&type=section&id=Equity%20Movements%20(2019)) For the six months ended September 30, 2019, the Group's total equity decreased due to dividend payments, share repurchases, and business combinations under common control Equity Movements (First Half of 2019) | Indicator | As of Apr 1, 2019 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Total equity at beginning of period | 15,459,827 | | | Total comprehensive income for the period | 1,236,926 | | | 2018 final dividend paid | (2,543,364) | | | Share repurchases | (142,357) | | | Business combination under common control | (51,986) | | | Total equity at end of period | | 13,957,509 | [Interim Condensed Consolidated Statement of Cash Flows](index=35&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This section presents the Group's cash flows from operating, investing, and financing activities for the reporting period [Operating Activities](index=35&type=section&id=Operating%20Activities) For the six months ended September 30, 2020, net cash inflow from operating activities increased by 22.2% year-on-year, demonstrating strong operational cash generation capabilities Cash Flows from Operating Activities (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Cash generated from operations | 2,857,486 | 2,585,259 | | Income tax paid | (608,495) | (716,787) | | Interest paid | (91,338) | (148,638) | | Interest received | 206,468 | 214,672 | | **Net cash flows from operating activities** | 2,364,121 | 1,934,506 | [Investing Activities](index=37&type=section&id=Investing%20Activities) For the six months ended September 30, 2020, net cash outflow from investing activities increased, primarily due to higher expenditures on the purchase of property, plant and equipment and financial assets at fair value through other comprehensive income Cash Flows from Investing Activities (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Purchase of property, plant and equipment | (159,708) | (134,983) | | Purchase of financial assets at fair value through other comprehensive income | (53,589) | – | | **Net cash flows used in investing activities** | (207,392) | (132,200) | [Financing Activities](index=37&type=section&id=Financing%20Activities) For the six months ended September 30, 2020, net cash outflow from financing activities decreased, as significant dividend payments and share repurchases were partially offset by a substantial increase in proceeds from borrowings Cash Flows from Financing Activities (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Dividends paid to equity holders | (2,990,184) | (2,543,364) | | Share repurchases | (669,510) | (142,357) | | Proceeds from borrowings | 3,931,679 | 3,801,633 | | Repayment of borrowings | (2,269,488) | (3,450,773) | | **Net cash flows used in financing activities** | (2,031,576) | (2,410,939) | [Net Change in Cash and Equivalents](index=38&type=section&id=Net%20Change%20in%20Cash%20and%20Equivalents) For the six months ended September 30, 2020, the Group achieved a net increase in cash and cash equivalents, reversing the net decrease trend of the prior year, despite exchange losses Net Change in Cash and Cash Equivalents (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Net increase/(decrease) in cash and cash equivalents | 125,153 | (608,633) | | Cash and cash equivalents at end of period | 17,339,163 | 16,636,232 | [Notes to the Condensed Consolidated Interim Financial Information](index=37&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Information) This section provides detailed explanations and disclosures supporting the condensed consolidated interim financial statements [General Information](index=39&type=section&id=General%20Information) This section outlines Want Want China Holdings Limited's principal activities, registration and listing information, and the presentation currency of its financial reports - The Group is primarily engaged in the manufacturing and distribution of food and beverages, with major operating activities in mainland China and products sold to North America, East Asia, Southeast Asia, and Europe[122](index=122&type=chunk) - The Company was incorporated in the Cayman Islands on **October 3, 2007**, and has been listed on the Main Board of The Stock Exchange of Hong Kong Limited since **March 26, 2008**[122](index=122&type=chunk) - The condensed consolidated interim financial information is presented in **RMB**[122](index=122&type=chunk) [Basis of Preparation](index=39&type=section&id=Basis%20of%20Preparation) This condensed consolidated interim financial information is prepared in accordance with HKAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual consolidated financial statements for the year ended March 31, 2020 - This condensed consolidated interim financial information has been prepared in accordance with HKAS 34 "Interim Financial Reporting"[122](index=122&type=chunk) - It should be read in conjunction with the annual consolidated financial statements for the year ended March 31, 2020[122](index=122&type=chunk) [Accounting Policies](index=40&type=section&id=Accounting%20Policies) The accounting policies adopted in this period are consistent with the previous year's consolidated financial statements, except for income tax estimates and the adoption of several HKFRS amendments, which had no significant impact on the Group's financial statements - Accounting policies are consistent with the annual consolidated financial statements for the year ended March 31, 2020, except for income tax estimates and the adoption of HKFRS amendments effective for the financial year ending March 31, 2021[124](index=124&type=chunk) - New amendments adopted include HKAS 1 and 8 (Definition of Material), HKFRS 3 (Definition of a Business), Amendments to Conceptual Framework for Financial Reporting, HKFRS 7, 9 and HKAS 39 (Interest Rate Benchmark Reform), and HKFRS 16 (COVID-19-Related Rent Concessions)[124](index=124&type=chunk)[125](index=125&type=chunk)[127](index=127&type=chunk)[131](index=131&type=chunk) - These new amendments and interpretations had no significant impact on the Group's financial statements[124](index=124&type=chunk) [Estimates](index=45&type=section&id=Estimates) The significant judgments made by management in applying accounting policies and the key sources of estimation uncertainty are the same as those applied to the consolidated financial statements for the year ended March 31, 2020, except for changes in determining income tax provisions - The significant judgments made by management in applying accounting policies and the key sources of estimation uncertainty are the same as those applied to the consolidated financial statements for the year ended March 31, 2020, except for changes in determining income tax provisions[135](index=135&type=chunk) [Financial Risk Management](index=45&type=section&id=Financial%20Risk%20Management) The Group is exposed to market risks (including currency, interest rate, and price risks), credit risk, and liquidity risk, with no significant changes in risk management policies or contractual undiscounted cash outflows of financial liabilities since year-end - The Group's activities expose it to various financial risks: market risk (including foreign currency risk, fair value interest rate risk, cash flow interest rate risk, and price risk), credit risk, and liquidity risk[137](index=137&type=chunk) - There have been no changes in the risk management department or risk management policies since year-end, nor have there been any significant changes in the contractual undiscounted cash outflows of financial liabilities[137](index=137&type=chunk)[138](index=138&type=chunk) - As of September 30, 2020, financial assets at fair value through other comprehensive income (Level 1) amounted to **RMB 90,842 thousand**[140](index=140&type=chunk) [Segment Information](index=47&type=section&id=Segment%20Information) The Group primarily operates four business segments: rice crackers, dairy and beverages, snack foods, and other products, with over 90% of revenue and business activities conducted in China, and all segments were profitable and incurred capital expenditures in the first half of fiscal year 2020 - The Group's operations are primarily managed through four business segments: rice crackers, dairy and beverages, snack foods, and other products[145](index=145&type=chunk) - Over **90%** of the Group's revenue and business activities are conducted in China[145](index=145&type=chunk) Segment Profit (First Half of 2020) | Segment | Revenue (RMB'000) | Segment Profit (RMB'000) | | :--- | :--- | :--- | | Rice Crackers | 1,992,268 | 395,991 | | Dairy and Beverages | 5,315,003 | 1,690,620 | | Snack Foods | 2,951,974 | 695,317 | | Other Products | 40,002 | 24,873 | - Total capital expenditure for the first half of fiscal year 2020 was **RMB 160,091 thousand**, primarily for production plants and equipment across all segments[148](index=148&type=chunk) [Investment in Associates](index=53&type=section&id=Investment%20in%20Associates) As of September 30, 2020, the Group's investment in associates decreased to RMB 14,376 thousand, primarily due to its share of losses from associates Investment in Associates Movements | Indicator | As of Sep 30, 2020 (RMB'000) | | :--- | :--- | | Balance at beginning of period | 15,425 | | Share of loss of associates | (1,049) | | Balance at end of period | 14,376 | [Property, Plant and Equipment, Investment Properties and Intangible Assets](index=54&type=section&id=Property%2C%20Plant%20and%20Equipment%2C%20Investment%20Properties%20and%20Intangible%20Assets) As of September 30, 2020, the Group's net book value of property, plant and equipment decreased, but additions were made to support business development, with slight changes also observed in investment properties and intangible assets Net Book Value of Non-current Assets | Indicator | As of Sep 30, 2020 (RMB'000) | As of Apr 1, 2020 (RMB'000) | | :--- | :--- | :--- | | Property, plant and equipment | 6,553,357 | 6,770,980 | | Investment properties | 37,351 | 37,944 | | Intangible assets | 11,958 | 13,027 | - For the six months ended September 30, 2020, additions to property, plant and equipment amounted to **RMB 204,306 thousand**[161](index=161&type=chunk) [Leases](index=55&type=section&id=Leases) As of September 30, 2020, the Group's total right-of-use assets and lease liabilities both increased, with corresponding depreciation and interest expenses incurred during the period Lease-Related Data | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | Right-of-use assets | 1,065,754 | 1,062,289 | | Total lease liabilities | 139,992 | 118,912 | - For the six months ended September 30, 2020, depreciation of right-of-use assets was **RMB 44,931 thousand**, and total cash payments for leases were **RMB 99,091 thousand**[165](index=165&type=chunk) [Inventories](index=56&type=section&id=Inventories) As of September 30, 2020, the Group's total inventories slightly decreased, with a significant reduction in goods in transit Inventory Composition | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | Raw materials and packing materials | 1,684,516 | 1,621,545 | | Work in progress | 250,675 | 216,331 | | Finished goods | 671,822 | 646,599 | | Goods in transit | 29,396 | 261,692 | | **Total** | 2,636,409 | 2,746,167 | [Trade Receivables](index=56&type=section&id=Trade%20Receivables) As of September 30, 2020, the Group's net trade receivables increased, with most receivables due within 60 days, indicating efficient collection Net Trade Receivables and Ageing Analysis | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | Trade receivables – net | 933,562 | 846,744 | | Within 60 days | 702,990 | 382,742 | | 61-90 days | 126,849 | 187,662 | - The majority of the Group's sales are on a cash-on-delivery basis, with credit terms for modern distribution channels and some emerging channels typically ranging from **60 to 90 days**[170](index=170&type=chunk) [Share Capital](index=57&type=section&id=Share%20Capital) For the six months ended September 30, 2020, the Company's issued share capital decreased due to share repurchases, leading to a corresponding reduction in total share capital Issued Share Capital Movements | Indicator | As of Apr 1, 2020 | As of Sep 30, 2020 | | :--- | :--- | :--- | | Number of ordinary shares issued (shares) | 12,415,184,135 | 12,274,312,135 | | Shares repurchased (shares) | | (140,872,000) | | Share capital (RMB'000) | 1,866,355 | 1,847,089 | - For the six months ended September 30, 2020, the Company repurchased and cancelled **140,872,000 shares**, with a total payment of **RMB 669,510 thousand**[177](index=177&type=chunk) [Reserves](index=59&type=section&id=Reserves) As of September 30, 2020, the Group's total reserves decreased, primarily impacted by share repurchases and dividend payments, partially offset by total comprehensive income for the period, with statutory reserves for specific purposes and share premium available for distribution Reserves Movements (For the six months ended September 30) | Indicator | As of Apr 1, 2020 (RMB'000) | As of Sep 30, 2020 (RMB'000) | | :--- | :--- | :--- | | Reserves at beginning of period | 13,406,327 | | | Total comprehensive income for the period | 2,242,140 | | | Share repurchases | (650,244) | | | 2019 final dividend paid | (2,990,184) | | | Reserves at end of period | | 12,008,039 | - Share premium is available for distribution to shareholders, subject to solvency tests and the provisions of the Company's articles of association[187](index=187&type=chunk) - Statutory reserve funds are used to cover losses, expand production operations, or increase the company's capital[187](index=187&type=chunk) [Trade Payables](index=62&type=section&id=Trade%20Payables) As of September 30, 2020, the Group's total trade payables slightly increased, with the majority due within 60 days Trade Payables Ageing Analysis | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | Total trade payables | 1,146,928 | 1,093,092 | | Within 60 days | 1,087,043 | 985,783 | - Trade payables primarily arise from credit purchases of raw materials, with credit terms granted by suppliers generally ranging from **30 to 60 days**[190](index=190&type=chunk) [Borrowings](index=62&type=section&id=Borrowings) As of September 30, 2020, the Group's total borrowings significantly increased, primarily due to a substantial rise in current borrowings and a decrease in non-current borrowings, while the Group still maintains substantial unutilized floating rate borrowing facilities Borrowings Composition | Indicator | As of Sep 30, 2020 (RMB'000) | As of Mar 31, 2020 (RMB'000) | | :--- | :--- | :--- | | Non-current borrowings | 3,386,378 | 8,293,566 | | Current borrowings | 6,831,970 | 587,085 | | **Total borrowings** | 10,218,348 | 8,880,651 | - For the six months ended September 30, 2020, borrowings increased by **RMB 3,937,537 thousand**, and repayments of borrowings amounted to **RMB 2,269,488 thousand**[194](index=194&type=chunk) - The Group issued **US$500 million** guaranteed bonds in 2017, which will be fully repaid on **April 27, 2022**, with an annual interest rate of **2.875%**[194](index=194&type=chunk) - The Group has unutilized floating rate borrowing facilities of **RMB 6,962,337 thousand** maturing within one year[198](index=198&type=chunk) [Other (Losses)/Gains – Net](index=64&type=section&id=Other%20(Losses)%2FGains%20%E2%80%93%20Net) For the six months ended September 30, 2020, the Group recorded other net losses, primarily due to net exchange losses and net losses on disposal of property, plant and equipment Other (Losses)/Gains – Net (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Net exchange (losses)/gains | (14,073) | 8,270 | | Donation expenses | (18,111) | (5,538) | | Net loss on disposal of property, plant and equipment | (7,853) | (4,285) | | **Total** | (36,094) | 1,787 | [Expenses by Nature](index=65&type=section&id=Expenses%20by%20Nature) For the six months ended September 30, 2020, the Group's cost of raw materials used and changes in inventories increased, employee benefit expenses slightly decreased, and advertising and promotion expenses significantly reduced Expenses by Nature (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Raw materials used and changes in inventories | 4,078,957 | 3,479,354 | | Employee benefit expenses | 1,837,767 | 1,876,004 | | Advertising and promotion expenses | 240,837 | 309,387 | | **Total cost of sales, distribution costs and administrative expenses** | 7,889,539 | 7,409,614 | [Income Tax Expense](index=66&type=section&id=Income%20Tax%20Expense) For the six months ended September 30, 2020, the Group's total income tax expense increased, primarily due to higher current income tax in mainland China Income Tax Expense (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Current income tax – mainland China | 689,786 | 509,156 | | Deferred income tax | 53,271 | 68,444 | | **Total** | 757,127 | 584,518 | - Income tax expense is recognized based on management's estimate of the weighted average annual income tax rate expected for the full financial year[203](index=203&type=chunk) [Earnings Per Share](index=66&type=section&id=Earnings%20Per%20Share) For the six months ended September 30, 2020, the Group's basic and diluted earnings per share both increased, reflecting higher profit attributable to equity holders of the Company, with basic and diluted earnings per share being identical due to no dilutive shares Earnings Per Share (For the six months ended September 30) | Indicator | As of Sep 30, 2020 | As of Sep 30, 2019 | | :--- | :--- | :--- | | Basic earnings per share (RMB cents) | 15.75 | 12.99 | | Diluted earnings per share (RMB cents) | 15.75 | 12.99 | - As the Company has no dilutive shares, diluted earnings per share are the same as basic earnings per share[206](index=206&type=chunk) [Dividends](index=67&type=section&id=Dividends) The final and special dividends for the year ended March 31, 2020, were paid in September 2020, and the Board declared an interim dividend of 0.65 US cents per share for the six months ended September 30, 2020, payable on December 23, 2020 - The final and special dividends of **RMB 2,990,184 thousand** for the year ended March 31, 2020, were paid in **September 2020**[207](index=207&type=chunk) - The Board declared an interim dividend of **0.65 US cents** per share for the six months ended September 30, 2020, on **November 19, 2020**, to be paid on **December 23, 2020**[207](index=207&type=chunk) - This interim dividend (**RMB 555,346 thousand**) has not been recognized as a liability in this condensed consolidated interim financial information but will be recognized in equity for the financial year ending March 31, 2021[207](index=207&type=chunk) [Related Party Transactions](index=68&type=section&id=Related%20Party%20Transactions) This section discloses the Group's transactions and balances with related parties, primarily involving sales, purchases, and leasing activities with companies controlled by the Chairman and his family, as well as minority shareholders of subsidiaries, with all receivables and payables being unsecured, interest-free, and without fixed repayment terms - The ultimate controlling party of the Group is Mr. Tsai Eng-Meng, the Chairman and CEO of the Group, and his family[210](index=210&type=chunk) - For the six months ended September 30, 2020, sales of goods to minority shareholders of subsidiaries amounted to **RMB 12,951 thousand**, and purchases of goods and services from companies controlled by the Chairman amounted to **RMB 19,961 thousand**[211](index=211&type=chunk) - As of September 30, 2020, trade receivables (due from minority shareholders of subsidiaries) amounted to **RMB 18,622 thousand**[214](index=214&type=chunk) - Receivables and payables are unsecured, interest-free, and without fixed repayment terms[214](index=214&type=chunk) [Key Management Compensation](index=70&type=section&id=Key%20Management%20Compensation) For the six months ended September 30, 2020, total compensation for key management personnel, including directors and senior management, amounted to RMB 7,807 thousand Key Management Compensation (For the six months ended September 30) | Indicator | As of Sep 30, 2020 (RMB'000) | As of Sep 30, 2019 (RMB'000) | | :--- | :--- | :--- | | Fees | 2,930 | 2,596 | | Salaries | 2,854 | 2,901 | | Other benefits | 1,858 | 1,727 | | Employer's contribution to pension schemes | 165 | 216 | | **Total** | 7,807 | 7,440 | [Events After Balance Sheet Date](index=70&type=section&id=Events%20After%20Balance%20Sheet%20Date) In October 2020, the Company repurchased and cancelled its own ordinary shares on The Stock Exchange of Hong Kong Limited - In **October 2020**, the Company repurchased and cancelled **46,723,000 ordinary shares**, with a total payment of **HK$246,103,010**[219](index=219&type=chunk)[220](index=220&type=chunk)[234](index=234&type=chunk) [Other Information](index=69&type=section&id=Other%20Information) This section provides additional disclosures not covered in the financial statements, including dividend details, directors' interests, and corporate governance practices [Interim Dividend and Closure of Register of Members](index=71&type=section&id=Interim%20Dividend%20and%20Closure%20of%20Register%20of%20Members) The Board declared an interim dividend of 0.65 US cents per share for the six months ended September 30, 2020, payable on December 23, 2020, and the company will close its register of members from December 7 to 9, 2020, to determine dividend entitlements - The Board declared an interim dividend of **0.65 US cents** per ordinary share for the six months ended September 30, 2020, on **November 19, 2020**[222](index=222&type=chunk) - The interim dividend will be paid on or about **December 23, 2020**, to shareholders whose names appear on the company's register of members on **December 9, 2020**[222](index=222&type=chunk) - The company will suspend registration of share transfers from **December 7, 2020, to December 9, 2020** (both days inclusive)[223](index=223&type=chunk) [Directors' and Chief Executive's Interests](index=71&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests) As of September 30, 2020, the company's directors and chief executive held long positions in the company's shares, with Mr. Tsai Eng-Meng holding the largest stake through beneficial and controlled corporate interests - As of September 30, 2020, Mr. Tsai Eng-Meng (Chairman and CEO) held **6,320,843,100 ordinary shares** in the Company (representing approximately **51.4965%** of the issued share capital), including beneficial interests and controlled corporate interests[228](index=228&type=chunk) - Other directors also held shares in the Company, for example, Mr. Cheng Wen-Hsien held **463,162,640 shares** (representing approximately **3.7734%**)[228](index=228&type=chunk) - As of September 30, 2020, no director or chief executive held any short positions in the shares, underlying shares, or debentures of the Company or its associated corporations[226](index=226&type=chunk) [Other Person's Interests](index=74&type=section&id=Other%20Person's%20Interests) As of September 30, 2020, other persons, apart from directors and the chief executive, held long positions in the company's shares, primarily entities beneficially owned by Mr. Tsai Eng-Meng - Want Power Holdings Limited (WPHL) held **5,080,063,100 shares**, representing approximately **41.3878%** of the Company's issued share capital[230](index=230&type=chunk) - Norwares Overseas Inc. (NOI) held **1,063,780,000 shares**, representing approximately **8.6667%** of the Company's issued share capital[230](index=230&type=chunk) - Shares held by WPHL and NOI are both beneficially owned by Mr. Tsai Eng-Meng[230](index=230&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=75&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) The Company continued to repurchase and cancel its listed shares on the Hong Kong Stock Exchange during the six months ended September 30, 2020, and after the balance sheet date, as the Board believes this is in the best interest of the company and shareholders and enhances earnings per share - For the six months ended September 30, 2020, the Company repurchased a total of **140,872,000 shares** on the Hong Kong Stock Exchange for a total of **HK$757,033,141**, which have been cancelled[231](index=231&type=chunk)[233](index=233&type=chunk) - After the balance sheet date of September 30, 2020, the Company repurchased and cancelled an additional **46,723,000 shares** in **October 2020**, for a total of **HK$246,103,010**[233](index=233&type=chunk)[234](index=234&type=chunk) - The Directors believe that the share repurchases are in the best interests of the Company and its shareholders and will enhance the Company's earnings per share[235](index=235&type=chunk) [Model Code for Directors' Securities Transactions](index=76&type=section&id=Model%20Code%20for%20Directors'%20Securities%20Transactions) The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 of the Listing Rules, and all directors confirmed compliance during the six months ended September 30, 2020 - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 of the Listing Rules[235](index=235&type=chunk) - All Directors confirmed compliance with the standards set out in the Model Code during the six months ended September 30, 2020[235](index=235&type=chunk) [Corporate Governance Practices](index=76&type=section&id=Corporate%20Governance%20Practices) For the six months ended September 30, 2020, the Company complied with the Corporate Governance Code, with deviations regarding the combined roles of Chairman and CEO and non-executive director tenure, but the Board believes sufficient measures are in place to safeguard shareholder interests - The Company has complied with the Corporate Governance Code, except for deviations from Code Provision A.2.1 (combined roles of Chairman and CEO) and A.4.1 (non-executive directors without specific terms of appointment)[236](index=236&type=chunk) - The Board believes that Mr. Tsai Eng-Meng serving concurrently as Chairman and CEO provides strong and consistent leadership to the Company[236](index=236&type=chunk) - Non-executive directors are required to retire by rotation at least once every three years, and the Board believes sufficient measures have been taken to safeguard shareholders' interests[236](index=236&type=chunk) [Changes of Director's Information](index=77&type=section&id=Changes%20of%20Director's%20Information) This section discloses changes in director information, including the appointment of independent non-executive directors Mr. Lee Kwok Ming and Mr. Chu Chia-Fu to other listed companies, the establishment of the Environmental, Social and Governance Committee, and the renewal of Mr. Tsai Eng-Meng's service contract - Independent Non-executive Director Mr. Lee Kwok Ming was appointed as an independent non-executive director of Bossini International Holdings Limited effective **July 24, 2020**[238](index=238&type=chunk) - The Environmental, Social and Governance Committee was established on **August 18, 2020**, to promote and assist the Board in managing the Group's environmental, social, and governance matters[238](index=238&type=chunk) - The Board resolved to renew Mr. Tsai Eng-Meng's service contract for a term of **3 years** commencing **August 26, 2020**, with no changes to the main terms and conditions[238](index=238&type=chunk) - Independent Non-executive Director Mr. Chu Chia-Fu was appointed as an independent non-executive director of Ocean Sky International Limited effective **October 1, 2020**[238](index=238&type=chunk) [Audit and Risk Management Committee](index=78&type=section&id=Audit%20and%20Risk%20Management%20Committee) The Audit and Risk Management Committee, comprising five independent non-executive directors, has reviewed the unaudited interim results for the six months ended September 30, 2020, with the external auditor PricewaterhouseCoopers - The Audit and Risk Management Committee comprises **5 independent non-executive directors**, with Mr. Chu Chia-Fu as Chairman[241](index=241&type=chunk) - The Committee, together with the external auditor PricewaterhouseCoopers, has reviewed the unaudited interim results for the six months ended September 30, 2020[241](index=241&type=chunk)