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告之內容 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，概不就 因本公告全部或任何部分內容而產生或因倚賴該等內容而引致之任何損 失承擔任何責任。 SOUTH CHINA HOLDINGS COMPANY LIMITED 南 華 集 團 控 股 有 限 公 司 （於開曼群島註冊成立之有限公司） （股份代號：00413） 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度 之 全 年 業 績 公 告 集團業績 South China Holdings Company Limited南 華 集 團 控 股 有 限 公 司（「本 公 司」）之 董事會（「董事會」或「董事」）欣然宣佈本公司及其附屬公司（統稱「本集團」） 截至二零二二年十二月三十一日止年度之綜合業績連同上一個財政年度 之比較數字如下： 綜合損益表 二零二二年 二零二一年 附註 千港元 千港元 ...

Financial Performance - Revenue for the six months ended June 30, 2022, was HKD 2,199,680, an increase of 15.5% from HKD 1,896,036 in the same period of 2021[3] - Gross profit for the same period was HKD 303,644, compared to HKD 189,475 in 2021, reflecting a significant increase of 60.1%[3] - Operating profit for the six months was HKD 125,596, a turnaround from an operating loss of HKD 23,784 in the previous year[3] - Net profit for the period was HKD 37,731, compared to a net loss of HKD 109,216 in the same period of 2021[5] - Basic earnings per share for the period was HKD 0.4, recovering from a loss of HKD 0.8 per share in the previous year[5] - The company reported a total comprehensive income of HKD 37,731 for the period, compared to a loss of HKD 109,216 in the previous year[8] - Cash generated from operating activities was HKD 50,306,000, a significant improvement from a cash outflow of HKD 232,632,000 in the previous year[18] - The company reported a pre-tax profit of HKD 36,749 for the six months ended June 30, 2022[26] - The company reported a loss attributable to shareholders of approximately HKD 46,693,000 for the six months ended June 30, 2022, compared to a loss of HKD 108,279,000 for the same period in 2021[44] Assets and Liabilities - Total assets as of June 30, 2022, were HKD 15,746,216, a decrease from HKD 16,457,626 as of December 31, 2021[14] - Current liabilities totaled HKD 4,163,650, an increase from HKD 3,957,875 at the end of 2021[14] - Non-current liabilities decreased to HKD 4,558,085 from HKD 4,759,520 at the end of the previous year[14] - The company reported a total equity of HKD 6,628,998,000 as of June 30, 2022, compared to HKD 6,683,500,000 as of June 30, 2021[16] - The company’s total liabilities decreased to HKD 1,711,355,000 from HKD 1,684,274,000 year-over-year[18] - The total assets as of June 30, 2022, were HKD 15,350,733, compared to HKD 12,220,811 as of December 31, 2021, indicating a growth of approximately 25.5%[27] - The total liabilities as of June 30, 2022, were HKD 8,721,735, compared to HKD 7,469,191 as of December 31, 2021, reflecting an increase of about 16.8%[27] Cash Flow - Net cash generated from investing activities was HKD 42,888,000, compared to a cash outflow of HKD 17,002,000 in the prior year[18] - Cash and cash equivalents at the end of the period increased to HKD 621,926,000 from HKD 557,592,000 in the previous year[18] - The company recorded a cash flow increase of HKD 40,713,000 for the period, contrasting with a decrease of HKD 18,252,000 in the previous year[18] - New bank loans amounted to HKD 1,711,355,000, while repayments of bank loans were HKD 1,542,931,000, resulting in a net cash outflow from financing activities of HKD 43,826,000[18] Revenue Segments - The trading and manufacturing segment generated revenue of approximately HKD 2,015,000,000, a 30% increase from HKD 1,552,000,000 in 2021, with an operating profit of approximately HKD 107,700,000[94] - OEM toy production revenue increased by 26% to approximately HKD 1,852,000,000, up from HKD 1,470,000,000 in 2021[95] - The footwear trading business saw a substantial revenue increase of 124% to approximately HKD 152,700,000, compared to HKD 68,200,000 in 2021[97] - The property investment and development segment's revenue slightly decreased by 1% to approximately HKD 184,700,000, down from HKD 186,100,000 in 2021[99] - Rental income from properties in Hong Kong, Nanjing, Shenyang, and Tianjin reached HKD 99,900,000, a decrease of approximately 15% compared to the same period in 2021[100] - Revenue from the United States and Europe for the six months ended June 30, 2022, was HKD 1,353,565, an increase from HKD 966,913 in the same period in 2021, reflecting a growth of approximately 39.9%[27] Market and Operational Strategy - The company plans to continue expanding its market presence and investing in new product development to drive future growth[27] - The group plans to implement prudent cost control and resource deployment strategies to maintain competitiveness and sustainability in a challenging environment[112] - The group aims to expand production in Guangxi while reducing operations in higher-cost areas like Shenzhen and Dongguan to control manufacturing costs[114] - The company continues to implement commercialization and transformation in various properties in mainland China, including the transformation of the Sunlight Plaza to attract a diverse range of tenants and consumers[116] - The company is exploring opportunities to convert land reserves in Nanjing and Tianjin from industrial to commercial use to enhance land value and development returns[118] Risks and Challenges - The management anticipates challenges and uncertainties in the second half of 2022 due to ongoing pandemic effects and geopolitical tensions, impacting consumer confidence and order volumes[111] - The company faces risks related to the real estate market in mainland China, including policy changes and economic conditions that may adversely affect its business and financial situation[124] - The company is subject to risks from natural disasters and adverse weather conditions that could impact agricultural yields and operational performance[126] Shareholding Structure - The company holds a significant shareholding structure, with the largest shareholder owning approximately 61.22% of the total issued ordinary shares[130] - Major shareholders include Ying Li with 1,075,765,537 shares (17.77%) and Bannock with 1,273,122,098 shares (9.63%)[151][152] - The total number of issued ordinary shares as of June 30, 2022, is 13,221,302,172[144][152] - The company holds 30% of ordinary shares, totaling 6,828,729,326 shares through controlled entities[142][147] Employee and Operational Metrics - The total number of employees as of June 30, 2022, was approximately 21,578, down from 25,451 a year earlier, with employee costs for the six months amounting to approximately HKD 682,900,000[110] - The company has adopted new accounting standards effective from January 1, 2022, which are expected to have no significant impact on the financial statements[21]

Financial Performance - For the year ended December 31, 2021, the company reported revenue of HKD 4,725,000,000, an increase of 16% compared to HKD 4,086,000,000 in 2020[23] - The company's profit for the year was HKD 33,000,000, down from HKD 65,000,000 in 2020[23] - Basic earnings per share attributable to owners of the company were HKD 0.02, compared to HKD 0.05 in 2020[24] - The trading and manufacturing segment recorded revenue of HKD 4,314,000,000, a 34% increase from HKD 3,224,000,000 in 2020, while operating profit decreased by 1% to HKD 87,100,000[27] - The OEM toy business generated revenue of HKD 4,129,000,000, a 33% increase compared to the previous year[34] - The property investment and development segment saw a significant revenue decrease of 52% to HKD 408,000,000 due to prior year sales of pre-sold properties[39] - Rental income from the company's properties in Hong Kong and mainland China reached HKD 233,600,000, an increase of approximately 8% from the previous year[39] - The revenue from the agriculture segment decreased by 80% to HKD 2,700,000, while operating losses reduced by 57% to HKD 11,800,000[41] Dividends and Reserves - The company did not declare or distribute any dividends during the year, consistent with the previous year[25] - As of December 31, 2021, the company's distributable reserves amounted to HKD 1,064,817,000, down from HKD 1,125,932,000 in 2020[150] - The company did not declare an interim dividend for the year, consistent with the previous year[133] - The board does not recommend the distribution of a final dividend for the year, similar to the previous year[133] - The company has adopted a dividend policy aimed at sharing profits with shareholders while retaining sufficient reserves for future development[134] Business Operations and Strategy - The company continues to focus on developing its flagship property project in Shenyang, which has a total construction area of over 500,000 square meters[39] - The total saleable area of residential buildings and serviced apartments in Central Plaza Phase 1 is approximately 170,000 square meters, with about 55% sold to date[40] - The group plans to continue relocating production from Shenzhen and Dongguan to Guangxi and Vietnam to reduce production costs and enhance competitiveness[60] - The group is transforming the Xinghui Plaza from a fur-themed shopping mall to a multi-retail space to increase rental income and attract diverse customer demographics[63] - The group has implemented temporary rent reductions for several tenants in Hong Kong and mainland China, which will not have a significant financial impact[64] - The management remains cautiously optimistic about sales and rental contributions in 2022 and beyond, despite challenges from the pandemic and geopolitical tensions[53] - The company maintains a cautiously optimistic outlook for the sales of residential units at Central Plaza, attributed to its prime location and accessibility via the subway[65] Employee and Governance - The total number of employees as of December 31, 2021, was approximately 16,111, with employee costs amounting to HKD 1,459,000,000[52] - The company emphasizes the importance of employee development and has implemented stock option and incentive plans to reward contributions to growth[104] - The executive team includes experienced members with backgrounds in finance, law, and management, enhancing the company's governance[120][121] - The board of directors includes independent members with extensive experience in media and finance, ensuring diverse perspectives[124][125] - The board is responsible for the group’s ESG strategy and reporting, ensuring compliance with ESG risk management[131] Risks and Challenges - The company faces risks related to the macroeconomic environment, including potential declines in consumer discretionary income due to economic downturns, which could adversely affect customer orders[68] - Rising costs due to raw materials, transportation, and compliance with minimum wage legislation in mainland China may impact the profit margins of the company's products[69] - The company is exposed to risks associated with the real estate market in mainland China, including policy changes, currency fluctuations, and overall economic conditions[74] - The company is also affected by the overall economic and real estate market conditions in Hong Kong, which may influence rental income from its properties[75] - The agriculture segment is vulnerable to natural disasters and adverse weather conditions, which could lead to reduced yields or production delays[76] Legal Matters - The company is involved in ongoing litigation regarding copyright infringement, seeking compensation of RMB 210.4 million for damages related to software rights[85] - The company is pursuing legal action to claim ownership of 31 software copyrights, asserting that the software developed by Nanjing Qingtian is based on its own resources and personnel[88] - A court ruling requires Nanjing Qingtian and its associated individuals to pay a total of RMB 22,533,377.09 to the company, with additional amounts owed by individual defendants[89] - The Jiangsu High Court has identified approximately RMB 28,000,000 in Nanjing Qingtian's bank accounts, pending further legal proceedings[90] - The company has filed a lawsuit against Binhai Group for breach of contract, seeking RMB 166 million in damages, which is currently under review[98] Corporate Social Responsibility - The group reported charitable donations of HKD 3,382,000 for the year, an increase from HKD 2,450,000 in the previous year[149] - The company is committed to environmental protection and compliance with environmental regulations in its operations[102] Shareholder Information - The largest customer accounted for 42.6% of total sales, while the top five customers collectively represented 73.6% of total sales[159] - The largest supplier contributed 8.0% to total procurement, with the top five suppliers accounting for 20.4%[159] - As of December 31, 2021, the total issued ordinary shares amounted to 13,221,302,172[178] - The executive director Wu Hongsheng holds approximately 61.22% of the total issued ordinary shares[174] - The company has no provisions for preemptive rights in its articles of association[153] - All independent non-executive directors confirmed their independence as per the listing rules[163] - The board of directors includes a mix of executive and non-executive members, with specific roles outlined[160] Financial Instruments and Options - The company issued 109,975,631 redeemable convertible preferred shares, which could convert into 219,951,262 ordinary shares, generating proceeds of HKD 87,980,000[152] - The company has no outstanding stock options or agreements at year-end[152] - The company adopted the share option plan in June 2012 to encourage and reward eligible participants for their contributions to the group's success[186] - No share options were granted under the 2012 share option plan during the year, and 1,500,000 options lapsed due to employee resignations[186] - As of December 31, 2021, the total number of share options outstanding was 13,000,000, down from 14,500,000 at the beginning of the year[187] - The exercise price for the share options is set at HKD 0.51 per share[187] - The employee share award plan was adopted in March 2011, allowing the company to purchase up to HKD 60,000,000 worth of its own shares for the plan[197] - The company has implemented a defined contribution retirement benefit plan and a mandatory provident fund plan for its employees[199] - There were no arrangements during the year that allowed directors to benefit from purchasing shares or bonds of the company or any other entity[198] - The company has not granted any rights to directors or key executives to subscribe for shares or debt securities during the year[198] - The share options are subject to a vesting period, with varying percentages exercisable based on the time elapsed since the grant date[188] - The company has engaged in transactions with related parties as defined by the listing rules, detailed in the annual report[200]

Financial Performance - Revenue for the six months ended June 30, 2021, was HKD 1,738,006, an increase of 11.7% compared to HKD 1,556,119 for the same period in 2020[3] - Gross profit for the period was HKD 189,475, representing a gross margin of approximately 10.9%, up from HKD 162,214 in 2020[3] - Operating loss decreased to HKD 23,784 from HKD 39,153 year-over-year, indicating improved operational efficiency[3] - Net loss for the period was HKD 109,216, compared to a net loss of HKD 146,549 in the previous year, reflecting a 25.5% reduction in losses[3] - The group reported a pre-tax loss of HKD (106,465,000) for the period, an improvement from HKD (141,659,000) in the previous year, showing a reduction in losses[63] - The group reported a post-tax loss of approximately HKD 109,200,000, an improvement from a loss of HKD 146,500,000 in the same period of 2020[112] Assets and Liabilities - Total assets as of June 30, 2021, amounted to HKD 15,435,358, an increase from HKD 15,097,785 at the end of 2020[51] - Current assets increased to HKD 4,235,560 from HKD 3,897,564, showing a growth of 8.7%[51] - Non-current assets totaled HKD 11,057,910, up from HKD 10,963,689, indicating a 0.9% increase[49] - Total liabilities increased to HKD 8,662,132 from HKD 8,177,753, reflecting a rise of 5.9%[51] - The company’s total liabilities decreased from HKD 6,393,021 thousand as of January 1, 2021, to HKD 6,631,338 thousand as of June 30, 2021, indicating a reduction of approximately 4.1%[53] - Total liabilities reached HKD 8,662,132, compared to HKD 8,177,753 in the prior year, indicating a year-over-year increase of approximately 5.9%[66] Cash Flow and Investments - The net cash outflow from operating activities for the six months ended June 30, 2021, was HKD 238,194 thousand, compared to HKD 156,890 thousand for the same period in 2020, indicating an increase of 51.6%[55] - Cash and cash equivalents at the end of the period were HKD 557,592 thousand, down from HKD 672,392 thousand at the end of June 30, 2020, reflecting a decrease of 17.0%[55] - The company incurred a net cash outflow from investing activities of HKD 17,002 thousand for the six months ended June 30, 2021, compared to HKD 14,481 thousand in the same period of 2020, representing an increase of 17.6%[55] - New bank loans added during the period amounted to HKD 1,684,274 thousand, while repayments of bank loans were HKD 1,358,783 thousand, resulting in a net cash inflow from financing activities of HKD 236,944 thousand[55] Shareholder Information - The company reported a basic loss per share of HKD 0.8, an improvement from HKD 1.1 in the previous year[16] - The loss per share attributable to equity holders was HKD 0.8 cents, improved from HKD 1.1 cents in 2020[113] - The company did not declare an interim dividend for the six months ended June 30, 2021, consistent with the previous year[72] - The company holds 61.22% of its ordinary shares, with significant holdings by major shareholders including 1,075,765,537 shares held by Ying Li[172] Revenue Breakdown - Revenue from the United States reached HKD 966,913,000, significantly up from HKD 498,414,000 in the previous year, marking an increase of approximately 93.8%[64] - Revenue from Europe was HKD 341,589,000, up from HKD 237,800,000, reflecting a growth of approximately 43.7% year-over-year[64] - The group's revenue from China, including Hong Kong and Macau, was HKD 291,842,000, down from HKD 691,368,000, indicating a decline of approximately 57.8%[64] - The trading and manufacturing segment generated revenue of approximately HKD 1,552,000,000, a 67% increase from HKD 931,000,000 in 2020, with an operating loss of approximately HKD 34,400,000[115] - OEM toy manufacturing revenue reached approximately HKD 1,470,000,000, a 68% increase compared to HKD 874,000,000 in 2020[116] - Footwear trading business revenue increased by 39% to approximately HKD 68,200,000, up from HKD 48,900,000 in 2020[119] Operational Challenges - The group faced significant challenges in cost control due to rising production and logistics costs, including labor and material costs[116] - The management anticipates challenges and uncertainties in the second half of 2021 due to the Delta variant, US-China trade tensions, and RMB appreciation[134] - The company is exposed to risks from natural disasters affecting its agricultural operations, which could lead to reduced yields or production delays[148] - The company is subject to increased costs due to raw materials, transportation, and compliance with minimum wage legislation in mainland China[145] Corporate Governance - The company has established an Audit Committee consisting of five members, including four independent non-executive directors and one non-executive director[194] - The company has adopted a standard code of conduct for directors regarding securities trading[192] - The Audit Committee reviewed the unaudited interim financial statements for the six months ended June 30, 2021, and deemed them to be prepared in accordance with applicable accounting standards[194] - The company complied with the corporate governance code, except for certain deviations related to the absence of directors at the annual general meeting[183]

Financial Performance - For the year ended December 31, 2020, the group recorded revenue of HKD 4,086,000,000, a decrease of 7% compared to HKD 4,410,000,000 in 2019[22] - The profit for the year was HKD 65,000,000, significantly down from HKD 556,000,000 in 2019, primarily due to the absence of fair value gains from property investments[22] - Basic earnings per share attributable to the company's owners were HKD 0.5, down from HKD 4.6 in 2019[23] - The trading and manufacturing segment saw a revenue decrease of 23% to HKD 3,224,000,000, with operating profit down 66% to HKD 88,400,000[26] - The OEM toy business generated revenue of HKD 3,111,000,000, a 19% decrease compared to 2019, impacted by the COVID-19 pandemic[30] - The property investment and development segment's revenue surged by 286% to HKD 849,000,000, with operating profit (including fair value gains) at HKD 318,600,000[34] - Excluding fair value gains, the operating profit for the property segment was HKD 164,700,000, a 119% increase from HKD 75,200,000 in 2019[34] - The group's rental income for the year was HKD 216 million, slightly down from HKD 220.1 million in 2019[35] - The agricultural segment's revenue decreased by 5% to HKD 13.4 million, with an operating loss reduced to HKD 27.1 million[37] - As of December 31, 2020, the group's current ratio was 1.0 and the debt-to-equity ratio was 34%, compared to 1.4 and 27% in 2019[38] Strategic Initiatives - The group is actively seeking suitable production facilities for footwear products outside mainland China to mitigate the impact of the US-China trade war[33] - The group has implemented measures to restore production capacity in mainland China post-COVID-19 lockdowns, aiming to gain new orders and enhance customer loyalty[30] - The group plans to open two new factories in Guangxi and increase production capacity in Vietnam to enhance competitiveness amid market uncertainties[49] - The company is exploring the conversion of certain land reserves in Nanjing and Tianjin from industrial to commercial use to enhance land value and development returns[52] - The company has adopted a dividend policy aimed at sharing profits with shareholders while retaining sufficient reserves for future development[104] Risk Management - The group is closely monitoring exchange rate fluctuations and managing risks through forward contracts[39] - The company faces risks related to the real estate market in mainland China, including policy changes, currency fluctuations, and overall economic conditions[59] - The company continues to review and mitigate risks across its business units regularly[62] Employee and Corporate Governance - Approximately 17,363 employees were reported as of December 31, 2020, with employee costs around HKD 1.201 billion, down from HKD 1.395 billion in 2019[45] - The company has implemented a defined contribution retirement benefit plan and a mandatory provident fund plan for its employees[150] - The company has adopted an Employee Share Award Scheme with a budget of up to HKD 60,000,000 to purchase shares from the market for employee rewards[148] - The company emphasizes good corporate governance practices, ensuring accountability and transparency to shareholders[177] Market Outlook - The management maintains a cautious outlook for 2021, focusing on cost reduction and resource optimization to sustain business operations[46] - Future outlook indicates a projected revenue growth of 15% for the next fiscal year, driven by new product launches and market expansion strategies[89] - The company anticipates increased rental income from the Central Plaza in 2021 due to efforts to recruit potential tenants[50] Shareholder Information - As of December 31, 2020, the distributable reserves available for shareholders amounted to HKD 1,125,932,000, down from HKD 1,416,298,000 in 2019[116] - The company did not declare an interim dividend for the year, consistent with the previous year[103] - The board does not recommend a final dividend for the year ending December 31, 2020, similar to the previous year[103] Corporate Social Responsibility - The company reported a charitable donation of HKD 2,450,000 for the year, compared to HKD 1,137,000 in the previous year[115] - The company is focused on improving sales distribution channels and implementing cost control measures to enhance the performance of its agricultural segment[54] Board and Management Structure - The board is responsible for the company's ESG strategy and reporting, ensuring compliance with ESG risk management[101] - The board composition includes a balance of executive, non-executive, and independent non-executive directors, ensuring effective independent judgment[188] - The company has appointed a new independent non-executive director, Ms. Pang, on September 15, 2020[125] - The company has implemented a director and officer liability insurance policy to cover potential legal claims against directors and senior officers[186] Legal Matters - The company is awaiting a retrial date from the Jiangsu High Court regarding a copyright infringement case involving Nanjing Qingtian Technology Co., Ltd., with a claim for damages of RMB 210.4 million[65] - 南京擎天被认为是一家空壳公司，缺乏开发计算机软件的能力和条件[69] - 南京擎天及相关被告需向南华擎天偿付人民币22,533,377.09元，涉及多项连带清偿责任[70] - 江蘇省中級人民法院冻结南京擎天银行账户内约人民币28,000,000元[70] - 环威投资有限公司向濱海集团提起诉讼，要求赔偿金额约人民币1.66亿元（暂定）[74]

Financial Performance - Revenue for the six months ended June 30, 2020, was HKD 1,556,119, a decrease of 6.76% compared to HKD 1,669,274 in 2019[3] - Gross profit for the same period was HKD 162,214, down 34.0% from HKD 245,963 in 2019[3] - The net loss for the period was HKD 146,549, compared to a profit of HKD 26,810 in the previous year[21] - Total comprehensive loss amounted to HKD 233,635, significantly higher than the comprehensive income of HKD 24,153 in 2019[21] - The total comprehensive income for the six months ended June 30, 2020, was HKD 24,153, a significant decrease from HKD 225,151 in the same period of 2019, indicating a decline of 89.3%[82] - The operating loss for the six months ended June 30, 2020, was HKD 141,659,000, compared to an operating profit of HKD 37,465,000 in the same period of 2019[101] - The company reported a loss attributable to shareholders of HKD 146,500,000, compared to a profit of HKD 26,800,000 in the same period of 2019[192] Assets and Liabilities - Non-current assets totaled HKD 7,717,218 as of June 30, 2020, a decrease from HKD 7,875,284 at the end of 2019[23] - Current assets decreased to HKD 6,050,830 from HKD 6,768,828 in the previous year[23] - The total liabilities as of June 30, 2020, were HKD 7,615,832, compared to HKD 8,251,091 at the end of 2019[23] - The total liabilities increased significantly, with bank loans repaid amounting to HKD 1,600,108, compared to HKD 1,038,050 in the previous year, reflecting a rise of 54.1%[84] - The total assets as of December 31, 2020, were HKD 13,768,048,000, down from HKD 14,644,112,000 in 2019[106] - The total liabilities as of December 31, 2020, were HKD 7,615,832,000, down from HKD 8,251,091,000 in 2019[106] Cash Flow - The net cash outflow from operating activities for the six months ended June 30, 2020, was HKD 156,890, compared to HKD 96,260 for the same period in 2019, representing an increase of 63.0%[84] - Cash and cash equivalents at the end of the period were HKD 672,392, down from HKD 684,259 at the end of June 2019, indicating a decrease of 1.3%[84] - The company incurred a net cash outflow from investing activities of HKD 14,481 for the six months ended June 30, 2020, compared to HKD 31,968 in the previous year, showing a reduction of 54.7%[84] - The company reported a cash outflow of HKD 148,343 from financing activities, compared to an inflow of HKD 28,252 in the previous year, marking a shift in cash flow dynamics[84] Market Performance - Revenue from the China market, including Hong Kong and Macau, was HKD 691,368,000, significantly up from HKD 185,700,000 in 2019, marking an increase of approximately 272.5%[104] - Revenue from the US market decreased to HKD 498,414,000 from HKD 843,237,000, a decline of about 41%[104] - The trading and manufacturing segment saw a revenue decline of 40% to HKD 931,000,000, down from HKD 1,557,000,000 in 2019, resulting in an operating loss of HKD 43,600,000[195] - The OEM toy manufacturing business generated revenue of HKD 874,000,000, a 37% decrease from HKD 1,378,000,000 in 2019[196] - The footwear trading business experienced a 70% revenue drop to HKD 48,900,000, down from HKD 164,100,000 in 2019[200] Shareholder Information - The company reported a basic loss per share of HKD 1.1 cents for the period[15] - The basic loss per share for the six months ended June 30, 2020, was approximately HKD 145,156,000, compared to a profit of approximately HKD 36,660,000 in the same period of 2019[113] - The company did not declare an interim dividend for the six months ended June 30, 2020, consistent with the previous year[112] - The total issued and paid-up share capital remained at 13,221,302,172 ordinary shares as of June 30, 2020[151] Operational Insights - The company has implemented measures to enhance productivity and reduce costs through improved management information systems and big data analytics[197] - The company aims to maintain customer loyalty by providing integrated solutions and strengthening long-term business relationships[199] - The production facility in Vietnam has been operational since December 2019, increasing capacity and expanding the product and customer portfolio[199] - The company anticipates a recovery in economic activity, which is expected to stimulate toy orders from major U.S. customers[196] - The company is seeking suitable footwear production facilities outside of China to mitigate the impact of the U.S.-China trade war[200] Credit Management - The company maintained strict control over outstanding receivables and has a credit inquiry department to monitor credit risk[133] - The company confirmed specific loss provisions when there were objective indications that overdue receivables could not be collected according to original terms[133] - The company’s management regularly reviews overdue balances to mitigate credit risk[133] - Trade receivables as of June 30, 2020, amounted to approximately HKD 376,169,000, a decrease from HKD 454,486,000 as of December 31, 2019[132] - Trade payables as of June 30, 2020, were approximately HKD 584,175,000, down from HKD 778,146,000 as of December 31, 2019[134] - The weighted average number of ordinary shares in issue for basic earnings per share calculation was 12,982,892 for the six months ended June 30, 2020[124]

Financial Performance - The company reported revenue of HKD 4,410,000,000 for the year ended December 31, 2019, representing a 4% increase from HKD 4,228,000,000 in 2018[35] - The net profit attributable to shareholders for the year was HKD 556,000,000, with a 305% increase compared to HKD 141,000,000 in 2018, excluding the impact of HKFRS 16[35] - The earnings per share for the year was HKD 0.046, up from HKD 0.011 in 2018[36] - Revenue for the fiscal year reached HKD 1.2 billion, representing a 15% increase compared to the previous year[125] - The company reported a distributable reserve of HKD 1,416,298,000 as of December 31, 2019, down from HKD 1,519,090,000 in 2018[149] - The company has set a performance guidance of 20% revenue growth for the upcoming fiscal year[124] Segment Performance - The trade and manufacturing segment generated revenue of HKD 4,176,000,000, a 4% increase from HKD 4,007,000,000 in 2018, with operating profit rising 86% to HKD 257,000,000[38] - The OEM toy manufacturing business achieved record revenue of HKD 3,842,000,000, a 7% increase compared to the previous year[40] - The property investment and development segment saw revenue rise 4% to HKD 220,000,000, with operating profit (including fair value gains) amounting to HKD 940,000,000[42] - The footwear trading business experienced an 18% decline in revenue to HKD 306,000,000, primarily due to reduced sales orders from work boot products and the US market[41] - The group's revenue from the agriculture and forestry segment increased by 45% to HKD 14,100,000, while operating loss slightly decreased to HKD 55,000,000[50] Dividends and Shareholder Returns - The company did not declare or distribute any dividends for the year, consistent with 2018[37] - The board of directors has approved a dividend payout of HKD 0.10 per share, reflecting a commitment to returning value to shareholders[125] - The company did not declare an interim dividend for the year 2019, consistent with 2018[134] - The company has not recommended the payment of a final dividend for the year ending December 31, 2019, mirroring the decision made in 2018[134] - The board of directors has adopted a dividend policy aimed at retaining sufficient reserves for future development while distributing profits to shareholders[135] Operational Strategy and Development - The company established a representative office in Vietnam to develop production capacity and partnerships outside mainland China[40] - The company continues to focus on developing its property project in Shenyang, located in a prime area of the city[42] - The group is implementing cost reduction measures and optimizing resources to maintain competitive advantages amid challenging market conditions[58] - The group plans to enhance product quality and shift production capacity from Shenzhen and Dongguan to Guangxi to provide better services and products[64] - The group has begun transforming the Xinghui Plaza into a diversified shopping mall to enhance foot traffic and rental contributions[64] Legal and Compliance Issues - The company is involved in a lawsuit seeking compensation of RMB 210.4 million for copyright infringement related to software developed by a subsidiary[87] - Jiangsu High Court ruled that 13 software copyrights should belong to Nanhua Qingtian, as the development utilized Nanhua Qingtian's personnel and resources[89] - The company is pursuing legal avenues to claim ownership of an additional 18 software copyrights, asserting they were developed using Nanhua Qingtian's resources[89] - A total of RMB 22,533,377.09 is to be paid by defendants to Nanhua Qingtian as compensation for violating competition prohibitions under Chinese company law[93] - The company is exploring the feasibility of initiating judicial supervision procedures to protect its rights regarding land development in Tianjin Binhai New Area[99] Employee and Governance - The group has a total of approximately 17,521 employees as of December 31, 2019, with employee costs amounting to approximately HKD 1,395,000,000, down from HKD 1,499,000,000 in the previous year[57] - The company has established a stock option plan and share reward scheme to recognize and reward employees for their contributions to growth and development[109] - The company has implemented a defined contribution retirement benefit plan and a mandatory provident fund plan for its employees[200] - The company has a remuneration policy that considers market practices and individual contributions to the group[164] - All independent non-executive directors confirmed their independence as per the listing rules[161] Market and Strategic Initiatives - The company plans to expand its market presence in Southeast Asia, targeting a 30% increase in market share by 2025[126] - New product launches are expected to contribute an additional HKD 200 million in revenue over the next fiscal year[124] - The company is investing HKD 50 million in research and development for new technologies aimed at enhancing user experience[125] - A strategic acquisition is in progress, which is projected to increase the company's overall revenue by 10% within the next two years[126] - The management team emphasized the importance of sustainability initiatives, aiming for a 50% reduction in carbon footprint by 2030[124] Risk Management - The company faces risks related to the real estate market in mainland China, including policy changes and economic conditions that may adversely affect its business and financial performance[78] - The company is subject to cost increases due to rising raw material and transportation costs, as well as compliance with minimum wage legislation in mainland China[77] - The group is closely monitoring exchange rate trends to manage foreign currency exchange risks, particularly concerning RMB and USD[52] Shareholder Structure - The largest customer accounted for 48.8% of the group's total sales, while the top five customers together represented 78.4%[157] - The largest supplier contributed 8.0% to the group's total procurement, with the top five suppliers accounting for 26.7%[157] - The largest shareholder group, led by Mr. Wu, controls approximately 6.83 billion shares, indicating significant ownership concentration[185] - Mr. Wu Hongsheng held 651,899,514 shares, representing 61.22% of his personal interest in the company[169]

Financial Performance - Revenue for the six months ended June 30, 2019, was HKD 1,669,274 thousand, an increase from HKD 1,470,947 thousand in the same period of 2018, representing a growth of approximately 13.5%[2] - Gross profit for the period was HKD 245,963 thousand, compared to HKD 146,303 thousand in the previous year, indicating a significant increase of 68.3%[2] - Operating profit for the six months was HKD 134,341 thousand, up from HKD 89,464 thousand, reflecting a growth of 50.1%[2] - The net profit attributable to the owners of the company was HKD 36,660 thousand, compared to HKD 10,246 thousand in the same period last year, marking an increase of 258.5%[4] - Basic earnings per share increased to HKD 0.3 from HKD 0.1, representing a 200% increase year-on-year[5] - The company reported a total comprehensive income of HKD 24,153 thousand for the period, compared to a loss of HKD 55,209 thousand in the same period last year[25] - The company reported a net cash decrease of HKD (138,435) thousand, compared to HKD (162,617) thousand in the prior year, showing a reduction of 14.9%[41] - The group reported a total employee cost of approximately HKD 602 million for the six months ended June 30, 2019, down from HKD 633.8 million for the same period in 2018[116] Assets and Liabilities - Total non-current assets amounted to HKD 8,904,593 thousand, an increase from HKD 8,354,238 thousand in the previous year, reflecting a growth of 6.6%[35] - Current assets totaled HKD 5,395,232 thousand, compared to HKD 5,212,180 thousand in the previous year, indicating a growth of 3.5%[35] - Current liabilities totaled HKD 4,672,068 thousand, an increase from HKD 4,131,676 thousand year-over-year, representing a growth of approximately 13.1%[37] - Non-current liabilities totaled HKD 3,627,759 thousand, an increase from HKD 3,457,195 thousand, which is a rise of approximately 4.9%[37] - The company’s total liabilities increased to HKD 8,299,827 thousand from HKD 7,588,871 thousand, reflecting a rise of approximately 9.3%[37] - The total equity attributable to owners of the company was HKD 5,662,831 thousand, compared to HKD 5,629,702 thousand, marking a slight increase of 0.6%[39] Cash Flow - Net cash used in operating activities was HKD (96,260) thousand, compared to HKD (268,056) thousand in the previous year, indicating an improvement of 64.1%[41] - Cash and cash equivalents at the end of the period were HKD 684,259 thousand, up from HKD 507,087 thousand, representing a significant increase of 35.0%[41] - The company incurred cash outflows from investing activities amounting to HKD (31,968) thousand, contrasting with cash inflows of HKD 30,214 thousand in the previous year[41] Accounting Standards - The company has adopted the revised Hong Kong Financial Reporting Standard No. 16 from January 1, 2019, which may impact future financial reporting[5] - The Group has adopted new and revised Hong Kong Financial Reporting Standards effective from January 1, 2019, including HKFRS 16 "Leases" which introduces a single accounting model for lessees[46] - The initial recognition of lease liabilities is based on the present value of future lease payments, discounted using the interest rate implicit in the lease or the incremental borrowing rate[52] - The Group has opted for a modified retrospective approach for the first-time application of HKFRS 16, adjusting the opening balance of equity as of January 1, 2019[49] - The impact of the new accounting standards on the Group's financial position and performance will be disclosed in future reports[49] Segment Performance - Revenue from the United States segment was HKD 843,237,000 for the six months ended June 30, 2019, up from HKD 716,129,000 in 2018, marking a growth of about 17.8%[66] - The group’s revenue from Europe increased to HKD 409,453,000 for the six months ended June 30, 2019, compared to HKD 290,683,000 in 2018, indicating a significant growth of approximately 40.8%[66] - The trading and manufacturing segment generated revenue of HKD 1,557,000,000, a 14% increase from HKD 1,362,000,000 in the previous year, with an operating profit of HKD 50,300,000[101] - The OEM toy business achieved record revenue of HKD 1,378,000,000, a 16% increase compared to the same period in 2018[102] - The property investment and development segment saw a slight revenue increase of 1% to HKD 107,300,000, with operating profit including fair value gains of HKD 151,900,000[106] - The agriculture and forestry segment's revenue rose by 120% to HKD 5,100,000, while the operating loss decreased by 25% to HKD 24,100,000[108] Strategic Initiatives - The company has established a representative office in Vietnam to enhance production capacity and expand its product and customer base[103] - The company is focusing on developing a property project in Shenyang, with a total construction area of over 500,000 square meters, expected to enhance its market presence[107] - The group aims to expand its product categories and customer base while adjusting pricing strategies to cope with rising labor and material costs[119] - The group has invested significantly in R&D and engineering, with plans to increase capital investment in high-tech toy manufacturing processes and automation[120] Risks and Challenges - The company faces risks related to the real estate market in mainland China, including policy changes and economic conditions[132] - The agricultural business is susceptible to natural disasters and adverse weather conditions, which may impact production and operational performance[134] Shareholder Information - The board of directors holds significant equity, with Mr. Wu Hongsheng owning approximately 63.25% of the total issued ordinary shares[138] - The company’s major shareholders collectively hold significant stakes, with one shareholder holding approximately 63.25% of the total issued ordinary shares[146] - The company has a stock option plan established in June 2012, with a total of 47,640,000 options granted[151] - The employee share award plan allows the company to purchase up to HKD 60,000,000 worth of shares from the market[155] Corporate Governance - The company has complied with the corporate governance code as of June 30, 2019, except for certain directors who were unable to attend the annual general meeting due to other important matters[156] - The audit committee, consisting of four independent non-executive directors and one non-executive director, reviewed the unaudited interim results for the six months ending June 30, 2019, and found them to comply with applicable accounting standards[164]

Financial Performance - For the year ended December 31, 2018, South China Holdings Company Limited reported revenue of HKD 4,228,000,000, an increase of 8% from HKD 3,902,000,000 in 2017, and a profit of HKD 140,700,000, a decrease of 43% from HKD 248,100,000 in 2017[24]. - The trading and manufacturing segment saw revenue increase by 9% to HKD 4,007,000,000, with operating profit rising by 51% to HKD 137,800,000[27]. - The OEM toy business achieved record revenue of HKD 3,602,000,000, a 6% increase year-on-year, attributed to improved customer loyalty and trust[28]. - The footwear trading business revenue rose by 52% to HKD 371,600,000, with an overall profit of HKD 8,900,000 due to increased sales and gross margin[36]. - The property investment and development segment reported an 8% increase in revenue to HKD 211,200,000, but operating profit decreased by 31% to HKD 356,400,000 due to the absence of property sale gains[37]. - In 2018, the agricultural segment reported revenue of HKD 9,700,000, a decrease of 32% compared to 2017, while operating loss increased by 21% to HKD 58,700,000[40]. Operational Developments - Rental income remained stable, with significant contributions from the Xinghui Plaza shopping center in Shenyang, which is a leading fur mall in Liaoning Province[38]. - The Zhongyuan Plaza project, with a total construction area of over 500,000 square meters, is under development, with over 70% of pre-sold residential and serviced apartment units already sold[39]. - The ongoing development of the Central Plaza project in Shenyang is on schedule, with plans to sell remaining units of a residential building and a serviced apartment building in 2019[62]. - The group currently leases over 530,000 acres (approximately 353,000,000 square meters) of forest land, farmland, fish ponds, and lakes in various major provinces in mainland China, focusing on the cultivation of high-margin fruit and crops, as well as livestock farming[70]. Financial Ratios and Risks - As of December 31, 2018, the group's current ratio was 1.3 and the debt-to-equity ratio was 41.8%, compared to 1.9 and 42.0% in 2017[41]. - The group faced foreign exchange risks primarily related to RMB and USD, managing these risks through close monitoring and timely forward contracts[42]. - The group faces risks related to the macroeconomic environment, including potential declines in consumer discretionary income due to economic downturns, credit crises, and economic stagnation[73]. - Rising costs due to raw material and transportation price increases, as well as compliance with minimum wage legislation, may impact profit margins on products sold[74]. - The group is exposed to risks associated with the real estate market in mainland China, including policy changes, currency fluctuations, interest rate changes, and supply-demand imbalances[75]. - The agricultural business is vulnerable to natural disasters and adverse weather conditions, which could lead to reduced yields or production delays[77]. Legal Matters - The group is pursuing legal action against Nanjing Qingtian Technology Co., Ltd. for copyright infringement, seeking compensation of RMB 210,400,000 for damages[85]. - The Jiangsu High Court ruled that 13 software copyrights should belong to the group, based on evidence that Nanjing Qingtian lacked the necessary conditions to develop the software[86]. - The group is exploring all possible legal avenues to reclaim ownership of 31 software copyrights and prevent further sales or use by Nanjing Qingtian and/or China Qingtian[88]. - The company has initiated legal actions against various parties to confirm malicious collusion and to seek compensation for the infringement of rights related to the 290,000 square meters of land[97]. - The company has filed multiple administrative lawsuits regarding issues in the issuance of land use certificates, with some cases dismissed due to procedural grounds[98]. - The company is preparing to appeal to the Supreme People's Court regarding the dismissals of its administrative lawsuits, asserting unfair treatment in the judicial process[98]. Corporate Governance - The company emphasizes its commitment to environmental protection and compliance with relevant regulations in its operations[102]. - The company has a strong focus on corporate governance, with independent non-executive directors actively participating in audit and remuneration committees[122][123]. - The company has recognized the contributions of its board members, with several having significant experience in finance and law, which supports its strategic initiatives[121][124]. - The company has a diverse board with members holding degrees from prestigious institutions such as the University of Illinois and the University of Cambridge, enhancing its governance and strategic direction[117][119][120]. - The board of directors includes a mix of executive, non-executive, and independent non-executive members, ensuring diverse governance[159]. Shareholder Matters - The company's distributable reserves as of December 31, 2018, amounted to HKD 1,519,090,000, a decrease from HKD 1,627,321,000 in 2017[149]. - The company did not declare an interim dividend for the year ended December 31, 2018, consistent with 2017[134]. - The board of directors does not recommend the payment of a final dividend for the year ended December 31, 2018, also in line with 2017[134]. - The company has adopted a dividend policy aimed at distributing profits to shareholders while retaining sufficient reserves for future development[140]. Employee and Talent Management - The total employee count as of December 31, 2018, was approximately 17,461, with employee costs around HKD 1,499,000,000, slightly up from HKD 1,493,000,000 in 2017[47]. - The company aims to attract suitable talent to support its ongoing development through the Share Award Scheme[199]. - The remuneration of executive directors is determined based on market practices and the company's remuneration policy[168]. Strategic Focus - The management anticipates continued challenges in 2019 due to global economic changes and will focus on cost control and exploring opportunities in China[55]. - The group aims to enhance its competitive edge by investing in high-tech toy manufacturing processes and increasing capital input in automation[58]. - Following the establishment of new factories in Guangxi and Dongguan, the group is seeking to expand capacity and has identified suitable existing factories for future growth[59]. - The investment property portfolio in mainland China and Hong Kong totals approximately 580,000 square meters and 280,000 square feet, respectively, with expectations of rising rental income in 2019 and beyond[61]. - The group is actively considering the sale of non-core low-income properties to reallocate resources to more promising investment properties or land reserves[61].