Financial Performance - Revenue for the year ended December 31, 2024, was RMB 107,988,000, a decrease of 43% compared to RMB 189,139,000 in 2023[4] - Gross profit for 2024 was RMB 7,361,000, resulting in a gross profit margin of 7%, down from 14.88% in 2023[4] - Total comprehensive loss attributable to owners of the Company for 2024 was RMB 321,302,000, compared to a loss of RMB 80,199,000 in 2023[4] - Basic and diluted loss per share for 2024 was (106.55) RMB cents, compared to (26.59) RMB cents in 2023[4] - The Group recorded a loss and total comprehensive expense of RMB347,437,000 for the year[45] - The Group reported a net loss attributable to equity owners of approximately RMB 321.3 million for the year ended December 31, 2024[76] Assets and Liabilities - Non-current assets decreased to RMB 28,668,000 in 2024 from RMB 199,743,000 in 2023[9] - Current assets also declined to RMB 188,766,000 in 2024 from RMB 353,691,000 in 2023[9] - Shareholders' equity dropped significantly to RMB 92,577,000 in 2024 from RMB 403,920,000 in 2023[9] - Current liabilities of the Group stood at RMB 60.1 million, while available bank and cash balances were only RMB 755,000 as of December 31, 2024[76] - The Group's financial position as of December 31, 2024, is outlined in the consolidated financial statements[117] Operational Efficiency - The current ratio decreased to 3.14 in 2024 from 6.7 in 2023, indicating reduced liquidity[9] - The gearing ratio increased to 28% in 2024 from 10% in 2023, reflecting higher financial leverage[9] - Inventory turnover days increased to 329 days in 2024 from 408 days in 2023, suggesting slower inventory movement[9] - The inventory turnover days improved to approximately 329.24 days from 408 days in the previous year, indicating effective inventory management[53][58] - Trade receivables turnover days stood at 327.74 days, with trade receivables amounting to RMB 76,680,000, highlighting ongoing efforts in marketing and brand promotion[54][59] Governance and Management Changes - The company appointed Mr. Sun Jialiang as Chairman and CEO on September 30, 2024[11] - Mr. Wang Guangyuan resigned as Chairman and CEO on June 12, 2024[11] - The company experienced significant changes in its board, with multiple resignations and appointments throughout 2024[11][18][25] - The Audit Committee and Remuneration Committee were established with new members appointed on September 30, 2024[21][22] - The company is focusing on enhancing its governance structure with the appointment of new independent non-executive directors[18] - The Nomination Committee was formed with Mr. Sun Jialiang as Chairman, emphasizing the company's commitment to leadership stability[25] - The company secretary position was filled by Mr. Lai Wai Hing on November 13, 2024, indicating a focus on compliance and governance[18] - The company is undergoing a strategic review of its board composition to improve oversight and decision-making processes[25] - The company has seen a high turnover in executive positions, which may impact operational continuity and strategic direction[11][25] - The company is actively seeking to strengthen its leadership team to navigate future challenges and opportunities in the market[25] Market Performance - The sales revenue of sweet wine and dry wine accounted for 84.2% of the Group's total revenue, while brandy and other wine products accounted for 15.8%[36] - Revenue from the Eastern Region market was RMB 81,825,000, accounting for 75.8% of the group's total revenue, indicating strong market performance in that region[57][60] - In 2024, online sales accounted for 55% of the Group's total sales, while offline sales made up 45%[66] - In 2024, China's wine imports reached 280 million liters, with an import value of RMB 11.55 billion, reflecting year-on-year increases of 13.6% and 37.2%, respectively[62] - The Group anticipates that diversification into niche categories such as white wine and sparkling wine will be a key trend moving forward[63] Employee and Compensation - The Group employed a workforce of 82 in Hong Kong and China, with total salaries and related costs amounting to approximately RMB19,421,000, an increase from RMB17,980,000 in 2023[185] - The total salary and related costs for the year amount to RMB 19,421,000, compared to RMB 17,980,000 in 2023, reflecting an increase of approximately 8%[187] - The Group has adopted a share option scheme to motivate employees and reward their performance[184] - The 2023 Share Option Scheme aims to incentivize and retain high-caliber employees, with eligibility based on contributions to the Group's development[130] Shareholder Information - Bon Voyage Development Limited holds 40,000,000 shares of the company, representing approximately 13.27% of the issued share capital[84] - As of December 31, 2024, Mr. Wang Guangyuan holds 49,517,872 shares, representing approximately 16.42% of the company's issued share capital[165] - Mr. Li Jerry Y. and Mr. Zhu Minghui each hold 49,517,872 shares, also representing approximately 16.42% of the company's issued share capital, in addition to being beneficial owners of 20,000,000 shares each, which is about 6.63%[166] - The total number of shares held by Sky Source International Investments Limited is 69,517,872, accounting for approximately 23.05% of the issued share capital of the company[166] - The total number of Shares that may be issued under the 2023 Share Option Scheme shall not exceed 10% of the total number of Shares in issue on the Adoption Date[134] Compliance and Regulatory - The Company has maintained the prescribed public float as required under the Listing Rules throughout the year[191] - The Company has obtained all necessary permits and environmental approvals for its business operations, ensuring compliance with applicable environmental protection standards[197] - The existing auditor, Prism Hong Kong Limited, will retire at the upcoming annual general meeting and is eligible for re-appointment[200]

Financial Performance - Revenue decreased by approximately 42.9% to approximately RMB 107,988,000 compared to RMB 189,139,000 in 2023[2] - Gross profit decreased to approximately RMB 7,361,000 from RMB 28,149,000 in 2023[2] - Total comprehensive expense for the year attributable to owners of the Company amounted to approximately RMB 347,437,000, up from RMB 70,806,000 in 2023[2] - Basic and diluted loss per share increased to RMB 106.55 cents from RMB 26.59 cents in 2023[2] - The Group incurred a net loss attributable to equity owners of approximately RMB321,302,000 for the year ended 31 December 2024[21] - The Group reported a net loss attributable to equity holders of approximately RMB 321,302,000 for the year ended December 31, 2024[24] - The company reported a basic loss for the year attributable to owners of approximately RMB 321,302,000 in 2024, compared to RMB 80,199,000 in 2023, indicating a significant increase in losses[55][58] Assets and Liabilities - Non-current assets decreased significantly from RMB 199,743,000 in 2023 to RMB 28,668,000 in 2024[7] - Current assets decreased from RMB 353,691,000 in 2023 to RMB 188,766,000 in 2024[7] - Net current assets decreased from RMB 301,025,000 in 2023 to RMB 128,657,000 in 2024[7] - Total assets less current liabilities decreased from RMB 500,768,000 in 2023 to RMB 157,325,000 in 2024[8] - Total equity decreased from RMB 497,385,000 in 2023 to RMB 157,325,000 in 2024[8] - As of 31 December 2024, the total assets and total liabilities of the Subject Subsidiaries were RMB149,481,000 and RMB218,830,000, respectively[19] - The Group has current liabilities of RMB60,109,000 while available bank and cash balances were RMB755,000[21] - As of December 31, 2024, the Group's current liabilities amounted to RMB 60,109,000, while cash and cash equivalents were RMB 755,000[24] Financial Challenges and Governance - The Company faced significant challenges in obtaining financial documents and controlling certain subsidiaries due to the resignation of former executives[11] - The Board is unable to ascertain the current situation of the Subject Subsidiaries due to incomplete and unreliable information provided[15] - The Company has sent 19 demand letters to retrieve necessary financial documents from former executives but received only limited and insufficient documents[14] - The Board has deconsolidated the financial information of the Subject Subsidiaries from the Group's consolidated financial statements as of 31 December 2024[19] - The Group's directors believe that preparing the consolidated financial statements on a going concern basis is appropriate, given the expected sufficient financial resources for at least the next twelve months[25] - The Group's financial performance and position as of 31 December 2024 were impacted by the inability to consolidate certain subsidiaries, affecting overall financial reporting[75] - The Group's independent auditor's report for the year ended 31 December 2024 includes a qualified opinion due to communication challenges with former executive directors[79] - The loss of control over certain subsidiaries was attributed to the former executive directors' refusal to provide essential financial documents after their resignation in November 2024[80] - There exists a material uncertainty regarding the Group's ability to continue as a going concern due to significant losses and limited cash resources[92] Revenue and Sales - The Group's revenue from major products for the year ended December 31, 2024, was RMB 107,988,000, a decrease of 43% from RMB 189,139,000 in 2023[48] - Revenue from dry wines contributed RMB 80,300,000 in 2024, down from RMB 101,103,000 in 2023, representing a decline of approximately 20.6%[48] - The sales revenue from sweet wine and dry wine accounted for 84.2% of the Group's total revenue, while brandy and other wine products accounted for 15.8%[113] - Online sales accounted for 55% of total sales, while offline sales accounted for 45% throughout the year 2024[129] - The Group recorded revenue of RMB81,825,000 in the Eastern Region market, which accounted for 75.8% of the Group's total revenue[128] Expenses and Cost Management - The Group's gross profit decreased year-on-year to RMB7,361,000, with a gross profit margin of 7%, down from 14.9% in the previous year, representing a decline of 73.8%[118][116] - Selling and distribution expenses amounted to RMB7,947,000, a year-on-year decrease of 79.5%[119] - Administrative and other operating expenses were RMB12,322,000, representing a year-on-year decrease of 63%[120] - The Group recorded a total impairment of current and long-term assets amounting to RMB250,956,000 due to the unavailability of financial information from Subject Subsidiaries[121] - The Group's total comprehensive expense for the year was RMB347,437,000[122] Industry Context - The total retail sales of consumer goods in China reached RMB48.3 trillion in 2024, reflecting a year-on-year increase of 3.5%[108] - The retail sales of tobacco and alcohol amounted to approximately RMB615.9 billion, marking a year-on-year increase of 5.7%[108] - Wine production by large-scale alcohol enterprises in China totaled 118,000 kiloliters in 2024, representing a year-on-year decrease of 14.5%[108] - The domestic wine industry remains sluggish, with ongoing challenges from rising raw material costs and increased production expenses[108] - The focus of the wine industry in 2024 is on destocking due to the economic slowdown and incomplete recovery of consumer confidence[108] Corporate Governance and Compliance - The Company complied with the Corporate Governance Code, except for the deviation from code provision C.2.1 regarding the roles of chairman and CEO being held by the same individual[164] - All Directors confirmed their compliance with the Model Code for Securities Transactions during the year[165] - The Company has adopted the standard code of conduct for securities trading as per the Listing Rules Appendix C3, confirming compliance by all directors throughout the year[168] - The Audit Committee, comprising three independent non-executive Directors, reviewed the accounting principles and practices, and discussed financial reporting matters for the year ended December 31, 2024[170] Workforce and Employment - As of December 31, 2024, the Group employed a workforce of 82 in Hong Kong and the PRC, a decrease from 252 employees including the Tonghua subsidiary as of December 31, 2023[151] - Total salaries and related costs for the year amounted to approximately RMB 19,421,000, representing an increase of 8.0% from RMB 17,980,000 in 2023[151]

Share Option Schemes - The 2023 Share Option Scheme granted a total of 29,405,480 options on December 15, 2023, with a vesting period of 12 months[1] - As of December 31, 2023, no stock options were exercised or vested under the 2023 Share Option Scheme[1] - The 2019 Share Option Scheme was terminated on June 16, 2023, with no options available for grant as of December 31, 2023[2] - The total number of options granted under both the 2023 and 2019 Share Option Schemes represented 9.98% of the company's weighted average issued ordinary shares for the fiscal year ending December 31, 2023[2] Trading Suspension - Trading of the company's shares will be suspended from September 2, 2024, pending the release of the unaudited interim results for 2024[3]

Financial Performance - Revenue for the year ended December 31, 2023, was RMB 189,139,000, an increase of 29.5% compared to RMB 146,118,000 in 2022[5]. - Gross profit for 2023 was RMB 28,149,000, resulting in a gross profit margin of 14.88%, down from 24.55% in 2022[5][7]. - Total comprehensive loss attributable to owners of the Company for 2023 was RMB (80,199,000), compared to a loss of RMB (26,403,000) in 2022[5]. - Basic loss per share for 2023 was RMB (26.59 cents), compared to RMB (0.90 cents) in 2022[5]. - The Group's total revenue increased by nearly 30% year-on-year, reflecting successful strategic implementation[30]. - The Group's gross profit decreased to RMB 28,149,000, with a gross profit margin of 14.9%, down from 24.6% the previous year, reflecting a year-on-year decline of 21.5%[54][57]. - The total cost of sales increased by 46.0% year-on-year to RMB 160,990,000, primarily due to increased revenue and the write-off of obsolete inventories[59]. - The cost of raw materials rose by approximately 47.7% to RMB 130,824,000, accounting for about 81.3% of the total cost of sales[59]. Assets and Liabilities - Non-current assets decreased to RMB 199,743,000 in 2023 from RMB 223,517,000 in 2022[10]. - Current assets decreased to RMB 353,691,000 in 2023 from RMB 385,557,000 in 2022[10]. - Current liabilities increased to RMB 52,666,000 in 2023 from RMB 39,209,000 in 2022[10]. - Shareholders' equity decreased to RMB 403,920,000 in 2023 from RMB 483,634,000 in 2022[10]. - The Group's trade receivables at year-end were RMB 117,247,000, with turnover days decreasing from 314 days to 241 days[77][81]. - The Group's inventory turnover days improved significantly from 748 days to approximately 408 days, attributed to effective inventory management strategies[76][80]. Market Conditions - In 2023, China's GDP grew by 5.2%, but many sectors have not returned to pre-pandemic levels, impacting consumer sentiment[24]. - Imported wines in China experienced double-digit declines in both sales volume and value in 2023, indicating weak market demand[25]. - The Group anticipates continued pressure on the wine industry in China due to weak consumption and low per capita consumption levels, which may hinder market growth[91]. - The domestic wine industry is expected to remain under pressure due to weak consumer spending, with per capita consumption still low compared to other alcoholic beverages[94]. Strategic Initiatives - The Group increased sales of affordable wine products with lower gross margins while reducing investment in higher-priced premium wines and ginseng wine due to insufficient consumer confidence[28]. - The Group has adapted its marketing strategy by enhancing online sales and influencer marketing, as well as strengthening platform cooperation with brands in different industries[28]. - The Group is focusing on controlling expenditures and enhancing operational efficiency to maintain profitability amid market downturns[35]. - The Group is actively managing outstanding trade receivables and strengthening financial risk management[36]. - The Group plans to adjust its marketing strategy by reducing traditional promotions and enhancing cooperation with retail and food and beverage platforms to boost brand awareness[92]. - The Group will adopt a prudent operating strategy to broaden income sources and reduce expenses amid economic uncertainties and a sluggish wine market[93]. Regional Performance - Sales revenue from the Eastern Region more than doubled year-on-year, making it the Group's largest market[32]. - Revenue from the South-West Region saw nearly 90% year-on-year growth, indicating strong consumer demand[32]. - Revenue from the Eastern Region market amounted to RMB 81,555,000, representing a year-on-year increase of approximately 106.0%, making it the largest contributor to the Group's total revenue at 43.1%[74][79]. - Revenue from the South-West Region increased by approximately 88.9% year-on-year to RMB 46,877,000, accounting for 24.8% of total revenue[75]. Management and Governance - Mr. Zhu Minghui was appointed as a non-executive Director on 31 August 2022, holding a Bachelor degree in Finance and Economics from Bryant University[106]. - Dr. Cheng Vincent, appointed as an independent non-executive Director on 17 November 2018, has extensive experience in finance and accountancy, including roles in various companies listed on the Stock Exchange[112]. - The board comprises three independent non-executive directors, ensuring high standards of corporate governance[168]. - All independent non-executive directors were confirmed as independent during the year[168]. - The company has a substantial shareholder, Up Mount International Limited, which is 49% owned by Sky Source International Investments Limited[107]. Employee and Shareholder Information - As of December 31, 2023, the Group employed a workforce of 249, a decrease from 263 in 2022[200]. - The total salaries and related costs for the year amounted to approximately RMB 17,980,000, compared to RMB 18,059,000 in 2022[200]. - The Company has adopted a share option scheme to motivate employees and reward their performance[199]. - The 2023 Share Option Scheme allows the company to grant a maximum of 29,405,480 share options to eligible participants[145]. - The Company's reserves available for distribution as of December 31, 2023, amounted to approximately RMB 123,446,000, a decrease from RMB 127,594,000 in 2022[162].

Revenue and Profitability - Revenue increased by approximately 29.4% to approximately RMB 189,139,000 compared to RMB 146,118,000 in 2022[3] - The Group's total revenue for the year ended December 31, 2023, was RMB 189,139,000, an increase from RMB 146,118,000 in 2022, representing a growth of approximately 29.5%[31] - Total profit of reportable segments for 2023 was RMB 9,493,000, slightly up from RMB 9,441,000 in 2022, indicating a growth of 0.55%[33] - Revenue from dry wines surged to RMB 101,103,000 in 2023, up 51.3% from RMB 66,815,000 in 2022, while sweet wines revenue fell to RMB 46,432,000 from RMB 52,960,000, a decrease of 12.3%[44] - The Group's gross profit decreased by 34.7% year-on-year to RMB 28,149,000, with a gross profit margin of 14.9%[89] Loss and Expenses - Basic and diluted loss per share increased to RMB 26.59 cents from RMB 9.00 cents in 2022[3] - The consolidated loss for the year increased significantly to RMB 70,806,000 in 2023 from RMB 27,554,000 in 2022, representing a rise of 156.5%[33] - Total comprehensive expense for the year attributable to owners of the Company amounted to approximately RMB 70,806,000, up from RMB 27,554,000 in 2022[3] - The impairment loss on property, plant, and equipment rose sharply to RMB 19,858,000 in 2023 from RMB 7,776,000 in 2022, an increase of 154.3%[53] - The company reported a loss allowance for trade receivables of RMB 12,196,000 in 2023, compared to RMB 2,348,000 in 2022, reflecting a significant increase of 419.5%[53] Assets and Liabilities - Non-current assets decreased to RMB 199,743,000 from RMB 223,517,000 in 2022[9] - Current assets decreased to RMB 353,691,000 from RMB 383,557,000 in 2022[9] - Total assets decreased to RMB 553,434,000 in 2023 from RMB 607,074,000 in 2022, a decline of 8.84%[37] - Total equity decreased to RMB 497,385,000 from RMB 567,706,000 in 2022[9] - The total liabilities of reportable segments increased to RMB 7,962,000 in 2023 from RMB 4,677,000 in 2022, marking a rise of 70.4%[39] Regional Performance - Segment revenue from the Eastern Region was RMB 81,555,000, making it the highest revenue-generating segment for the Group in 2023[31] - Revenue from the Eastern Region market amounted to RMB 81,555,000, representing a year-on-year increase of approximately 106.0%[100] - Revenue from the South-West Region increased by approximately 88.9% year-on-year to RMB 46,877,000[101] - The North-East Region reported a segment loss of RMB 2,412,000 for the year ended December 31, 2023, compared to a profit of RMB 137,000 in 2022[31] Cash Flow and Working Capital - Bank and cash balances improved to RMB 95,483,000 in 2023 from RMB 70,893,000 in 2022, an increase of 34.8%[37] - The Group's net working capital as of December 31, 2023, was approximately RMB 301,025,000, compared to RMB 344,348,000 in 2022[123] - The Group's trade receivables at the end of 2023 were RMB 136,026,000, down from RMB 139,068,000 in 2022, with a net allowance for losses increasing to RMB 18,779,000 from RMB 6,583,000[62] Corporate Governance and Compliance - The Company has adopted the Model Code for Securities Transactions, ensuring compliance by Directors and relevant employees throughout the year[139] - The Company adhered to the Corporate Governance Code, with a noted deviation regarding the roles of Chairman and CEO being held by the same individual[140] - The audit committee reviewed the Group's accounting principles and internal controls, ensuring compliance with standards[141] - The Group's auditor confirmed that the financial figures for the year ended December 31, 2023, were agreed upon with the audited consolidated financial statements[146] Dividends and Share Capital - The company did not recommend any dividend for the year ended December 31, 2023, consistent with the previous year[54] - The Group's share capital increased to HK$30,156,000 in 2023 from HK$29,406,000 in 2022, following a share consolidation[73] Operational Strategy - The Group will maintain a prudent operating strategy to increase revenues and reduce costs amid economic uncertainties[120] - The average credit terms for sales to customers increased to 180 days in 2023, up from 90 to 180 days in 2022[21] Employee and Salary Information - As of December 31, 2023, the Group employed a workforce of 252 (excluding Directors), a decrease from 263 in 2022[132] - Total salaries and related costs for the year amounted to approximately RMB 17,980,000, down from RMB 18,059,000 in 2022, reflecting a decrease of about 0.44%[132]

Financial Performance - Revenue for the six months ended June 30, 2023, was RMB 75,671,000, representing an increase of 11.9% compared to RMB 67,651,000 in the same period of 2022[5]. - Gross profit for the same period was RMB 23,138,000, slightly down from RMB 23,259,000, resulting in a gross profit margin of 30.6%, down from 34.4% in 2022[5][7]. - The company reported a net loss attributable to owners of RMB 5,119,000, compared to a profit of RMB 407,000 in the prior year, leading to a basic and diluted loss per share of RMB (0.17) compared to earnings of RMB 0.01[5]. - The Group recorded total revenue of RMB 75,671,000, representing an increase of approximately 11.9% year-on-year[37]. - The gross profit for the Group during the period decreased slightly to RMB 23,138,000 year-on-year, with a gross profit margin decline of approximately 4 percentage points to 30.6%[38]. - The Group experienced a total comprehensive expense of RMB 1,619,000 for the period, compared to a profit of RMB 4,474,000 in the same period last year[55]. - Loss before tax amounted to RMB 1,619,000, contrasting with a profit of RMB 4,474,000 in the first half of 2022[164]. - The consolidated loss for the period was RMB 1,619,000, a decline from a profit of RMB 4,474,000 in the same period last year[200]. Assets and Liabilities - Non-current assets as of June 30, 2023, were RMB 223,080,000, slightly down from RMB 223,517,000 at the end of 2022[10]. - Current assets increased to RMB 394,285,000 from RMB 383,557,000, while current liabilities rose to RMB 51,106,000 from RMB 39,209,000[10]. - Total equity decreased to RMB 566,087,000 from RMB 567,706,000 at the end of 2022[169]. - Segment assets as of June 30, 2023, totaled RMB 106,478,000, down from RMB 132,681,000 as of December 31, 2022, representing a decrease of 19.7%[200]. - Segment liabilities increased to RMB 7,309,000 as of June 30, 2023, compared to RMB 4,677,000 as of December 31, 2022, reflecting a rise of 56.3%[200]. Cash Flow and Financial Health - Net cash generated from operating activities increased significantly to RMB 37,070,000 for the six months ended June 30, 2023, compared to RMB 7,381,000 in the same period of 2022, representing a growth of approximately 402%[179]. - Cash and cash equivalents at the end of the period rose to RMB 107,896,000, up from RMB 89,097,000 at the end of June 2022, reflecting an increase of approximately 21%[179]. - The repayment of lease liability decreased to RMB 894,000 from RMB 1,691,000, showing a reduction in financial obligations[179]. - The company is committed to prudent financial management and has minimal exposure to foreign exchange fluctuations due to most revenues being denominated in RMB[106]. Market and Operational Insights - The domestic wine market faced challenges due to excess inventories and intensified price wars, impacting the Group's performance[36]. - The overall economic recovery has not led to expected explosive growth in the domestic wine market, which continues to face significant challenges[35]. - The Group's sales of high-end products and gross margin decreased due to weaker demand amid slowing economic growth in China[38]. - The market atmosphere for the second half of 2023 is expected to improve compared to the first half, despite lingering effects from the pandemic[100]. Product and Sales Performance - Sales revenue from sweet wine and dry wine accounted for 82.1% of the total revenue during the Period under Review[37]. - Revenue from the Eastern Region market was RMB 28,746,000, representing a year-on-year increase of 44.6% and accounting for 38.0% of the Group's total revenue[78][80]. - The Group's sales revenue from dry wine products amounted to RMB 39,078,000, accounting for 51.6% of total revenue with a gross profit margin of 32.4%[91][95]. - Sales revenue from sweet wine products was RMB 23,048,000, representing 30.5% of total revenue with a gross profit margin of 19.8%[92][96]. - The Group's other products, including newly launched ginseng wine, generated sales revenue of RMB 5,532,000, accounting for 7.3% of total revenue with a gross profit margin of 42.4%[94]. Strategic Initiatives - The company is focusing on enhancing operational efficiency and exploring new market opportunities to improve future performance[3]. - The Group is actively exploring cooperation with other enterprises to develop more personalized and customized products for corporate clients[58]. - The Group has developed two new herbal wine products, "Ark No. 1" and "Ark No. 2," in collaboration with Ark Times Health Industry Holdings[63]. - The Group's marketing strategy includes increased brand promotion on TV and online media to enhance product recognition[57]. - The Group plans to extend its product line of personalized and customized wine to cater to the growing Z generation and female consumer groups[101]. Shareholder Information - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2023[108]. - As of June 30, 2023, Mr. Wang Guangyuan holds 495,178,720 shares, representing approximately 16.84% of the issued share capital[129]. - As of June 30, 2023, Mr. Li Jerry Y. and Mr. Zhu Minghui each hold 695,178,720 shares, representing approximately 23.64% of the issued share capital[131]. - The company maintained a sufficient public float of not less than 25% of its total issued shares since its listing on the Stock Exchange[144]. Compliance and Governance - The company has adopted the Model Code for Securities Transactions by Directors and confirmed compliance by all directors throughout the period[154]. - The interim results for the period are unaudited and have not been reviewed by the auditors[157]. - The audit committee reviewed the accounting principles and methods adopted by the company, along with risk management and internal controls[158].

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. 香港交易及結算所有限公司及香港聯合交易所有限公司對本公佈的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公佈全部或任何部分內容 而產生或因依賴該等內容而引致的任何損失承擔任何責任。 CHINA TONTINE WINES GROUP LIMITED 中 國 ...

Financial Performance - Revenue for 2022 was RMB 146,118,000, a decrease of 29.87% compared to RMB 208,371,000 in 2021[3]. - Gross profit for 2022 was RMB 35,874,000, resulting in a gross profit margin of 24.55%, down from 32.34% in 2021[3][5]. - Total comprehensive loss attributable to owners of the Company for 2022 was RMB 26,403,000, compared to a profit of RMB 11,336,000 in 2021[3]. - Basic loss per share for 2022 was RMB (0.90) cents, compared to earnings of RMB 0.55 cents per share in 2021[3]. - The total revenue for the Group was RMB 146,118,000, representing a decline of approximately 29.9% year-on-year[53]. - The Group's gross profit was RMB 35,874,000, a significant decrease of 46.8% from RMB 67,395,000 in the previous year[59]. - The gross profit margin fell to 24.6%, down from 32.3%, reflecting a decrease of 7.7 percentage points[59]. - Total comprehensive expense for the year was RMB 27,554,000, primarily due to write-offs of obsolete inventories and increased selling and distribution expenses[67]. Assets and Liabilities - Current assets decreased to RMB 383,557,000 in 2022 from RMB 428,915,000 in 2021, while current liabilities decreased to RMB 39,209,000 from RMB 66,310,000[8]. - Shareholders' equity as of 31 December 2022 was RMB 483,634,000, down from RMB 493,520,000 in 2021[8]. - The current ratio improved to 9.8 in 2022 from 6.5 in 2021, indicating better short-term financial health[8]. - The Group made a provision of approximately RMB 7,265,000 for inventory impairment during the year[54]. Inventory and Receivables - Inventory turnover days increased to 748 days in 2022, compared to 553 days in 2021, indicating slower inventory movement[8]. - Trade receivables turnover days increased to 314 days in 2022 from 162 days in 2021, suggesting longer collection periods[8]. - As of December 31, 2022, trade receivables amounting to RMB 132,485,000, reflecting an increase of 152 days compared to the previous year[92]. Market Conditions - The domestic wine output and sales both declined in 2022, marking it as the most difficult year for the domestic wine industry[22]. - The wine consumption market contracted significantly in 2022, with key sales seasons like the Mid-Autumn Festival and National Day underperforming[45]. - The total volume of imported wine in 2022 was 340 million liters, a year-on-year decrease of 21.1%, with an import amount of RMB9.6 billion, down 12.5%[46]. - The pandemic severely impacted production in Tonghua City, Jilin Province, leading to a significant reduction in production volume and halted sales due to logistics restrictions[64]. Marketing and Sales Strategies - The Group actively explored online sales and promoted "live-broadcast distribution" to adapt to changing consumption patterns, aiming to develop comprehensive marketing channels[28]. - The Group launched promotional videos and utilized live-streaming sales to enhance brand awareness and market penetration, focusing on both online and offline marketing strategies[71]. - The Group's marketing strategy included increased investment in advertising on provincial TV stations to solidify market share and brand exposure[71]. - The Group's selling and distribution expenses amounted to RMB 33,698,000, with advertising and marketing expenses significantly increasing to RMB 23,995,000 compared to the previous year[66]. Product Development - The Group initiated mass production of two new products developed in cooperation with Ji Yao Fang Zhou, expected to launch this year[33]. - The ginseng wine launched by the Group is highly recognized, with plans to expand production capacity and develop related products[34]. - The Group's new products, "Ark No. 1" and "Ark No. 2," are set for mass production to promote a healthy drinking concept[70]. Management and Governance - Mr. Wang Guangyuan has been the executive director and CEO since September 8, 2008, and is a founding member of the management team since the company's establishment in 2001[114]. - The company has a significant shareholder structure, with Mr. Wang Guangyuan holding 51% of the issued share capital of Up Mount International Limited[115]. - The company is committed to maintaining high governance standards, as evidenced by the roles of independent directors in audit and remuneration committees[125]. - The board includes young directors like Mr. Li Jerry Y. and Mr. Zhu Minghui, who bring fresh perspectives from their educational backgrounds in science and finance[121][123]. Future Outlook - The International Monetary Fund raised its forecast for China's economic growth to 5.2% in 2023[35]. - The new epidemic prevention policy introduced in December 2022 is expected to boost the consumer market and positively impact wine manufacturers[50]. - The retail and catering industries in Mainland China have shown signs of recovery, indicating a return of consumer sentiment[30]. - The introduction of the "New Ten Standards" policy for epidemic control is expected to revive the wine market, as social consumption gradually picks up[109][110].

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Financial Performance - Revenue for the six months ended June 30, 2022, was RMB 67,651,000, representing an increase of 4.0% from RMB 64,492,000 in 2021[4]. - Gross profit for the same period was RMB 23,259,000, up 28.4% from RMB 18,117,000 in 2021[4]. - The net profit attributable to owners of the Company was RMB 407,000, a significant recovery from a loss of RMB 7,908,000 in the previous year[4]. - Basic and diluted earnings per share were both RMB 0.01, compared to a loss of RMB 0.39 per share in 2021[4]. - Gross profit margin improved to 34.4% in 2022 from 28.1% in 2021[5]. - Net profit margin turned positive at 0.6%, recovering from a negative margin of 12.3% in the previous year[5]. - Profit and total comprehensive income for the period was RMB 4,474,000, marking a turnaround from a loss in the corresponding period last year[59]. - Profit before tax was RMB 4,474,000, compared to a loss of RMB 6,461,000 in the previous year[197]. Liquidity and Financial Health - Current ratio increased to 8.7 in 2022 from 6.5 in 2021, indicating improved liquidity[12]. - Quick ratio also improved to 4.5 in 2022 from 3.3 in 2021, reflecting better short-term financial health[12]. - The Group's cash and cash equivalents amounted to approximately RMB 89,097,000 as of June 30, 2022, indicating a healthy liquidity position[145][146]. - Cash and bank balances increased to RMB 89,097,000 from RMB 85,866,000 at the end of 2021[199]. Inventory and Cost Management - Inventory turnover days increased significantly to 1,021 days in 2022 from 553 days in 2021, indicating slower inventory movement[12]. - Total cost of sales was RMB 44,392,000, representing a year-on-year decrease of 4.3%[54]. - The cost of raw materials decreased by approximately 12.2% year-on-year, accounting for about 71.8% of the total cost of sales[54]. - Total cost of raw materials decreased by 12.2% to RMB 31,861,000 compared to RMB 36,298,000 in the previous year[57]. - Production overheads increased by 79.9% to RMB 4,457,000 from RMB 2,477,000 year-on-year[57]. - The company reported a significant reduction in selling and distribution expenses to RMB 5,151,000 from RMB 4,802,000 in 2021[197]. Regional Performance - For the first half of 2022, the Group recorded a revenue of RMB 19,874,000 in the Eastern Region, accounting for approximately 29.4% of total revenue, an increase of 9.9 percentage points year-on-year[94]. - The South-Central Region generated revenue of RMB 14,515,000, representing 21.5% of total revenue, with a year-on-year increase of 3.9 percentage points[96]. - The Northern Region achieved sales revenue of RMB 11,553,000, accounting for 17.1% of total revenue, reflecting an increase of approximately 58.0% compared to the previous year[98]. - The North-East Region's revenue was RMB 9,569,000, which is 14.1% of total revenue, showing a decrease of approximately 41.5% year-on-year due to pandemic impacts[99]. Market Trends and Strategic Initiatives - The shift to online sales and "live-broadcast distribution" has become a new trend, enhancing marketing cost efficiency for the Group[64]. - The Group launched a new ginseng wine product in 2021, which received positive market feedback, aiming to expand its product series leveraging abundant ginseng resources[65]. - The Group established Tontine Partner (Beijing) Wines Company Limited, a 51% owned subsidiary, to operate a pub chain project in collaboration with Partner Coffee[69]. - A strategic cooperation with café chain Partner Coffee was established to operate urban pub chain projects, supplying premium alcoholic beverages[133]. - The Group has adjusted its marketing strategies to create "online + offline" consumption scenarios, enhancing engagement with new consumer groups[132]. Shareholder and Corporate Governance - The Group does not recommend any interim dividend for the six months ended June 30, 2022, consistent with the previous year[143]. - The Company is committed to solid corporate governance and enhancing shareholder value[180]. - Mr. Wang Guangyuan serves as both the Chairman and CEO, responsible for overall business strategy and development[184]. - The Company has adopted the Model Code for Securities Transactions by Directors and confirmed compliance by all Directors throughout the Period[186]. Employment and Compensation - As of June 30, 2022, the Group employed a workforce of 275 in Hong Kong and the PRC, down from 324 as of December 31, 2021[156]. - Total salaries and related costs for the period amounted to approximately RMB 8,296,000, a decrease from RMB 8,489,000 in the corresponding period of 2021[156]. - The Group emphasizes competitive compensation and additional benefits to enhance employee skills and market awareness[155]. - The Company regularly reviews its human resources and compensation policies based on local laws, market conditions, and individual performance assessments[155]. Economic Context - China's GDP grew by 2.5% in the first half of the year, with a significant slowdown to 0.4% in the second quarter, indicating economic pressure[62]. - The market outlook for the second half of the year is complex and changeable, requiring the Group to maintain a vigilant and pragmatic approach to business development[134].