Business Growth and Development - As of December 31, 2023, the total number of signed pharmaceutical companies increased to 245, up from 160 in the previous year, representing a growth of 53.1%[3] - The total number of registered doctors reached 40,070, a significant increase from 25,819, marking a growth of 55.2%[3] - Registered patients numbered 482,000, up from 473,000, reflecting a growth of 1.5% year-over-year[3] - The total number of drug types offered increased to 198 from 192, indicating a broader product range available to consumers[3] - The number of online pharmacies increased slightly to 3,445 from 3,402, showing a stable growth in the digital pharmacy sector[3] Financial Performance - The revenue for the health consumption business in 2023 was HKD 399,413,000, a decrease of 52% compared to HKD 824,209,000 in 2022[18] - The revenue from the "Smart Health Service Platform" segment decreased by 52% to approximately HKD 399,413,000, accounting for about 30% of the group's total revenue[23] - The revenue from the medical intelligence business increased by 56%, resulting in a gross profit of approximately HKD 384,218,000, compared to HKD 335,657,000 in the previous year[24] - The company reported a total revenue of HKD 1,344,031,000 for the year ending December 31, 2023, a decrease of 15% compared to HKD 1,581,391,000 in 2022[67] - The gross profit for the company was HKD 413,429,000, reflecting a 17% increase from HKD 353,046,000 in the previous year[67] Operational Efficiency and Restructuring - The gross profit margin improved significantly from 2.0% in 2022 to 7.1% in 2023, indicating a strategic shift towards higher-margin businesses[18] - The company is actively restructuring its business model by divesting from low-margin vaccine and health check-up services to enhance operational efficiency[17] - The group aims to improve gross margins and reduce operating losses by cutting low-margin health service revenues and focusing on higher-margin new products/services[23] - The group's loss from continuing operations for the year was HKD 119,567,000, a significant reduction from HKD 317,701,000 in the previous fiscal year, representing a decrease of 64%[29] - The group's adjusted loss from continuing operations was HKD 106,466,000, down HKD 190,256,000 from HKD 296,722,000 in the previous fiscal year[29] Governance and Board Structure - The board of directors held five meetings during the year, with active participation from all members[53] - The company is actively seeking suitable candidates to fill the chairman vacancy as soon as feasible[51] - The board has established various committees, including an executive committee and an audit committee, to ensure effective governance and oversight[63] - The company aims to enhance its board diversity policy, considering factors such as gender, age, and professional expertise[56] - The board now has a female representation of 33.33%, with two out of six directors being women, exceeding the target set for 2022[84] Risk Management and Compliance - The company has established a "Risk Management Handbook" to define its risk management framework and processes, ensuring that risks are identified and managed effectively[113] - The internal audit function reports directly to the audit committee, responsible for reviewing the company's risk management and internal control measures[113] - The company emphasizes effective communication with stakeholders, including shareholders, customers, and investors, through various channels[113] - The company has implemented a policy for the disclosure of inside information to ensure timely and accurate information dissemination[113] - The company has confirmed that it possesses sufficient resources to continue operations for the foreseeable future, adopting a going concern basis for financial statements[102] Environmental, Social, and Governance (ESG) Initiatives - The company has identified a total of 19 significant ESG-related issues that impact its operations based on its business characteristics and industry focus[140] - The company emphasizes the importance of stakeholder engagement in shaping its sustainable development strategy, utilizing various communication channels to gather feedback[138] - The company has established a dedicated ESG working group responsible for overseeing the implementation of sustainable development strategies and ensuring compliance with regulatory requirements[136] - The company is committed to maintaining transparency and compliance with corporate governance standards as highlighted by stakeholder concerns[139] - The company is actively participating in community development and environmental governance to promote ecological protection[139] Employee Management and Training - The group has a total of 233 full-time employees as of December 31, 2023, with a turnover rate of 43.03%[162] - The average training hours per employee during the reporting period were 17 hours, with a total of 8 fire drills conducted[167] - The employee training program includes online and offline training, with a focus on enhancing skills and knowledge relevant to job performance[166] - The group emphasizes a healthy work-life balance and provides various employee benefits, including commercial medical insurance and personal accident insurance[165] - The company promotes diversity and equal opportunity in the workplace, actively implementing measures to support female employees[163] Community and Environmental Responsibility - The company complies with national and local environmental laws, with no penalties related to environmental violations reported during the period[179] - The company actively responds to the national "energy conservation and emission reduction" initiative, promoting sustainable and low-carbon development[180] - The company is committed to sustainable development and actively assumes social responsibility[197] - The group is committed to supporting carbon neutrality actions[1] - The group is developing new low-emission products and services to enhance competitive positioning[1]

Financial Performance - Total revenue for the year ended December 31, 2022, was HKD 1,344,031, a decrease from HKD 1,581,391 in 2021, representing a decline of approximately 15%[6] - The company recorded a pre-tax loss of HKD 65,762 for the year, compared to HKD 90,057 in the previous year[9] - The company reported a post-tax loss of HKD 13,432,000 for the year ended December 31, 2023, compared to a loss of HKD 14,340,000 in 2022[33] - The group's total loss for the year significantly narrowed to HKD 125,354,000, a decrease of over 60% from HKD 316,598,000 in 2022, aided by a reduction in losses from the "Yizhi Nuo" and "Mongoose Health" businesses[141] - Revenue for the period from January 1, 2023, to October 5, 2023, was HKD 92,271,000, with a gross profit of HKD 43,028,000[131] Assets and Liabilities - The company reported a total asset value of HKD 589,186 as of December 31, 2022, with total liabilities amounting to HKD 239,261[5] - The company reported a total of HKD 277,493 in non-current assets as of December 31, 2022[6] - The company’s total liabilities decreased to HKD 105,165,000 in 2023 from HKD 194,610,000 in 2022[24] - The company’s total liabilities, including bank and other borrowings, were approximately HKD 72,231,000 as of December 31, 2023[81] - The total current liabilities decreased from HKD 87,187,000 in 2022 to HKD 79,675,000 in 2023, representing a reduction of approximately 8.7%[108] Cash Flow and Financing - Cash and cash equivalents as of December 31, 2023, amounted to HKD 23,131,000, a decrease from HKD 65,980,000 in 2022[24] - The company repaid all bank borrowings amounting to HKD 5,605,000 during the year ended December 31, 2023, with interest rates decreasing from 4.35% in 2022 to 3.45% in 2023[65] - The company has signed a subscription agreement for a convertible bond of HKD 120 million with Hongyi Investment, aimed at supporting core business development[136] - The company is actively expanding financing channels to lay a foundation for future growth[136] Business Operations and Strategy - The company completed the acquisition of a 21.88% stake in Deep Sea Health Limited for RMB 20 million, gaining indirect ownership of a high-end clinic and hospital business in Shanghai[28] - The company has terminated the operation of the "Health and Wellness Services - Beihu No. 9 Club," classifying it as a discontinued operation[106] - The company has terminated the operation of the "Beihu No. 9 Club" following the early termination of the lease agreement[130] - The group is focusing on optimizing resource allocation by gradually divesting non-core businesses[140] - The group aims to ensure product and service quality from the source by implementing strict supplier admission standards[200] Market and Industry Insights - The compound annual growth rate (CAGR) for revenue in the medical industry segment is projected at 28.91% over the next five years[21] - The global digital healthcare market is projected to reach USD 286.35 billion in 2023 and USD 365.67 billion in 2024, indicating significant market potential[134] - The Chinese internet healthcare market is projected to reach RMB 200 billion by 2026, indicating significant growth potential[162] - The digital healthcare market is expected to benefit from post-pandemic changes in healthcare models and ongoing improvements in medical insurance policies[162] Digital Transformation and Innovation - The "ECN Yuan Zhi Digital Human" solution was launched to enhance productivity in the medical field, allowing for the rapid creation of AI digital avatars from just a few minutes of effective audio-visual material from doctors[144] - The strategic cooperation agreement with Tencent Cloud aims to promote digital transformation in the medical industry, focusing on AI technology development and joint product development[143] - The company is actively expanding its digital health service platform, focusing on providing integrated digital transformation solutions for pharmaceutical enterprises[186] - The company aims to enhance the accessibility of pharmaceuticals and improve patient quality of life through its digital operational solutions[186] Shareholder and Equity Information - The company issued 15,000,000 shares under the share incentive plan in 2023, a decrease from 77,500,000 shares in 2022[94] - The company has a total of 150,000,000,000 ordinary shares with a par value of HKD 0.02 as of December 31, 2023[112] - The company’s total issued shares increased from 13,498,107,000 in 2022 to 13,585,339,000 in 2023, reflecting an increase of approximately 0.65%[112] Research and Development - The company has initiated collaborations with universities to establish the "Yizhi Nuo Research Institute" to promote medical research and social welfare[191] - The company plans to leverage AI technology to enhance its operational systems and maintain industry leadership[161] Operational Efficiency - The company has eliminated high-cost and uncertain growth areas such as vaccination and health check services to enhance operational efficiency[194] - The company recognized share-based compensation expenses of approximately HKD 2,845,000 for the year ended December 31, 2023, a significant decrease from HKD 17,541,000 in 2022[117]

Share Grants and Vesting - As of December 31, 2022, the company granted a total of 77,500,000 incentive shares to employees, with 15,000,000 shares expiring during the year[3] - A total of 62,500,000 shares were vested and will be released in four equal installments of 25% each year from 2023 to 2026[3] - The total number of shares granted under the stock option and incentive plans represents approximately 0.46% of the weighted average number of shares issued during the year[8]

Digital Economy and Market Growth - The digital economy has achieved an average annual growth rate of 15.9% since 2012[3] - The digital healthcare market is projected to grow from USD 211 billion in 2022 to USD 809.2 billion by 2030, with a compound annual growth rate of 18.6%[22] - The digital economy in China reached RMB 45.5 trillion in 2021, with a nominal growth of 16.2% year-on-year, accounting for 39.8% of GDP[22] Company Performance and Financials - Total revenue for the period reached HKD 687,662,000, a 2% increase compared to HKD 672,683,000 in the previous year[37] - The overall loss of the group narrowed by 59% from approximately HKD 141 million in the previous year to about HKD 57 million[22] - The company achieved a revenue of HKD 148 million in the first half of 2023, a decrease of 57% compared to the previous year, primarily due to the reduction of losses in the health consumption sector and lower gross profit margins[28] - The company’s loss for the six months ended June 30, 2023, was HKD 57,377,000, compared to a loss of HKD 141,081,000 in the previous fiscal period, representing a significant improvement[61] - The adjusted loss for the same period was HKD 54,141,000, a reduction of HKD 68,854,000 or 56% from the adjusted loss of HKD 122,995,000 in the prior fiscal period[61] E-commerce and Digital Platforms - The company has launched a private e-commerce platform named "Hua Teng Yan Xuan," which is currently in the trial operation phase[14] - The private e-commerce platform adopts an S2B2C business model, shortening the distance between supply and demand[14] - The private e-commerce platform focuses on family health consumption, covering categories such as health food, beauty, and personal care products[14] - The private e-commerce platform "Hua Teng Yan Xuan" was officially launched in June 2023, aiming to provide high-margin services and innovative business pathways for entrepreneurs[30] - The gross profit margin of the "Hua Teng Yan Xuan" project is significantly higher than the previous levels of the health consumption business, indicating a positive trend for future profitability[32] Healthcare Services and Partnerships - The healthcare management business signed contracts with 16 new hospitals, bringing the total to 49 hospitals, including well-known institutions like Zhejiang Hospital[16] - The vaccination business achieved a GMV of RMB 72.72 million in the first half of 2023, representing a significant year-on-year growth of 83%[16] - The company is focusing on expanding its medical and health services, transitioning from a "treating illness" model to a "preventing illness" model in response to market demands[31] - The company aims to create a dual-driven model by further integrating medical health and lifestyle services to meet diverse consumer needs and enhance value creation[32] Digital Transformation and Technology - The company is focused on digital transformation in the healthcare industry, aiming to enhance market presence and operational efficiency through integrated online and offline solutions[27] - The strategic partnership with Tencent Cloud aims to enhance AI technology applications in the healthcare sector, focusing on small sample learning and AI-generated content[23] - The company has established a comprehensive digital operation solution for pharmaceutical enterprises, covering the entire development cycle[23] - The digital operation management system and private cloud data repository are being developed to optimize data visualization and enhance ROI for pharmaceutical companies[28] Cost Management and Operational Efficiency - The company implemented cost-saving measures to reduce overall operating losses, with net finance costs increasing to HKD 1,196,000 from HKD 743,000 in the previous year[41] - The company aims to enhance operational efficiency and growth through strategic initiatives and cost-saving measures in its health business[61] - Administrative expenses decreased by 30% to approximately HKD 56,508,000, mainly due to a significant reduction in share-based compensation expenses[60] Shareholder and Capital Structure - Major shareholders include Yuan Haibo with 2,397,340,107 shares (17.65%) and Tencent Holdings Limited with 2,116,251,467 shares (15.58%) as of June 30, 2023[70] - The company did not issue new ordinary shares during the six months ended June 30, 2023, maintaining its capital structure[63] - The company has not pledged any assets and has no significant contingent liabilities or guarantees as of June 30, 2023[73] Investment and Future Plans - The company is in the process of expanding its market presence and exploring new strategies, including potential mergers and acquisitions, although specific details are not provided in the content[1] - The company plans to focus on exploring new products and services with higher profit margins in response to the decline in revenue from lower-margin health consumption sources[39] - The company plans to terminate the operation of the "Beihu No. 9 Club" by October 5, 2023, to concentrate on expanding its internet medical and health services[33][34]

Financial Performance - Yizhi Nuo's revenue for the first half of 2023 was HKD 482,276,000, representing a 110% increase compared to HKD 229,124,000 in the same period of 2022[3]. - Total revenue for the six months ended June 30, 2023, was HKD 687,662,000, representing a 2% increase from HKD 672,683,000 in the same period of 2022[82]. - The company reported a net loss of HKD 57,377,000 for the six months ended June 30, 2023, compared to a net loss of HKD 141,081,000 in the same period of 2022[86]. - For the six months ended June 30, 2023, the company reported a loss of approximately HKD 54,141,000, a 56% reduction compared to a loss of HKD 122,995,000 in the same period of 2022[59]. - The company reported a net loss attributable to equity holders of HKD 118,413,000 for the period, with a significant increase in marketing and promotional expenses to HKD 197,005,000[175]. Revenue Breakdown - Revenue from the medical industry digital operation services reached HKD 482,276,000, a significant increase of 110% compared to HKD 229,124,000 in the previous year[82]. - Revenue from the "Smart Health Service Platform" decreased by 57% to approximately HKD 147,591,000, accounting for 21% of the group's total revenue, down from 51% in 2022[67]. - Revenue from the health and wellness service "Beihu No. 9 Club" increased by 9% year-on-year, reaching HKD 57,000,000 following the lifting of pandemic restrictions[52]. - The entertainment and media segment generated revenue of HKD 375,000, a significant decrease from HKD 44,958,000 in the same period last year[165]. - The healthcare service segment reported revenue of HKD 11,574,000, up from HKD 5,390,000 in the previous year, marking an increase of 115%[165]. Profitability and Margins - The gross profit for Yizhi Nuo was HKD 198,315,000, up 59% from HKD 124,557,000 year-on-year[3]. - The gross margin for the company's health and wellness business improved significantly to 9.8%, compared to 1.5% in 2022[23]. - Gross profit for the same period was approximately HKD 239,875,000, representing a 71% increase from HKD 140,528,000 year-on-year, with a gross margin improvement to 35% from 21%[37]. - The gross profit margin for the medical digital operation services increased to 35%, up from 21% in the previous year[73]. Expenses and Costs - Marketing and sales expenses increased by 22% to approximately HKD 218,477,000, primarily due to the Yizhi Nuo business[24]. - The cost of sales for the six months ended June 30, 2023, was approximately HKD 447,787,000, a decrease of 16% compared to HKD 532,155,000 in the previous year[37]. - The company incurred costs of HKD 283,961,000 related to Medical Industry Digital Operations during the period, reflecting a substantial increase from HKD 104,567,000 in the previous year[175]. Assets and Liabilities - As of June 30, 2023, the group reported a net current asset of HKD 16,182,000, maintaining a current ratio of 1.07, indicating a stable liquidity position[28]. - The total liabilities as of June 30, 2023, amounted to HKD 281,122,000, compared to HKD 239,261,000 at the end of December 2022[79]. - The company’s total equity decreased to HKD 287,354,000 as of June 30, 2023, from HKD 349,925,000 at the end of December 2022[79]. - Total assets decreased to HKD 568,476,000 as of June 30, 2023, from HKD 589,186,000 at the end of 2022[134]. Strategic Initiatives - The company plans to expand its private domain e-commerce business to meet diverse consumer needs, leveraging its existing healthcare services[7]. - The company aims to create a dual-driven model by integrating healthcare and lifestyle businesses to generate more value for the group[14]. - The company plans to continue expanding its digital healthcare services and smart health service platform to capture more market share in the healthcare industry[156]. Market Position and Growth - As of June 30, 2023, the number of pharmaceutical companies signed with the Yizhi Nuo platform increased to 195, a 22% increase from the end of 2022[2]. - The number of registered doctors on the Yizhi Nuo platform grew by 24% to 31,935 as of June 30, 2023, compared to 25,819 at the end of 2022[24]. - The company has successfully built a comprehensive medical service ecosystem covering pharmaceutical companies, retail pharmacies, healthcare providers, and patients[62]. Foreign Exchange and Financing - The group recorded a net foreign exchange loss of approximately HKD 3,150,000 due to fluctuations in the Chinese Yuan and Korean Won against the Hong Kong Dollar[29]. - The company raised HKD 49,029,000 from bank and other borrowings during the six months ended June 30, 2023, compared to HKD 10,364,000 in the same period of 2022[80]. - The net financing costs amounted to HKD 1,196,000 for the period[169]. Other Financial Metrics - The company's basic and diluted loss per share for the six months ended June 30, 2023, was HKD 0.32, compared to HKD 0.88 in the same period of 2022[111]. - Other comprehensive loss for the period, net of tax, was HKD 7,072,000, compared to HKD 17,540,000 in the previous year[112]. - The company has not made any provisions for Hong Kong profits tax due to no estimated taxable profits arising from Hong Kong during the period[177].

Financial Performance - The company reported a net loss of HKD 316,598,000 for the year, compared to a net loss of HKD 141,427,000 in the previous year[60]. - The total comprehensive loss amounted to HKD 14,340,000 for the year ended December 31, 2022, compared to HKD 15,188,000 in the previous year[26]. - The company reported a net loss of HKD 269,980,000 for the year ended December 31, 2022, compared to a loss of HKD 110,402,000 in 2021[150]. - The company’s adjusted net loss for the year was HKD 295.6 million, reflecting a 159% increase from HKD 114.3 million in the previous year[122]. - The company reported a significant increase in marketing and promotional expenses, which rose to HKD 334,317 thousand in 2022 from HKD 15,626 thousand in 2021, reflecting a substantial increase in marketing efforts[195]. - The company recorded a loss of HKD 316,598,000 for the year ended December 31, 2022, compared to a loss of HKD 141,427,000 in 2021[60]. - The company reported a net loss before tax of HKD (141,845) thousand for 2022, compared to a net loss of HKD (418) thousand in 2021, indicating a substantial increase in pre-tax losses[192]. Revenue Growth - The company's total revenue for the year ended December 31, 2022, was HKD 1,692,061,000, a significant increase from HKD 327,713,000 in 2021[54]. - Revenue from online pharmaceutical prescriptions, circulation, and marketing reached HKD 606,130,000, up from HKD 35,968,000 in the previous year, indicating a growth of approximately 1,684%[54]. - The smart health service platform generated HKD 807,511,000 in health consumption revenue, compared to HKD 22,457,000 in 2021, reflecting an increase of about 3,493%[54]. - The main revenue sources were "Yizhi Nuo" and "Mango Health," generating revenues of HKD 606 million and HKD 824 million respectively, together accounting for 85% of total revenue[132]. - The company’s revenue from external customers in China was HKD 1,564,234 thousand in 2022, a significant increase from HKD 174,905 thousand in 2021, reflecting a growth of approximately 795%[194]. Assets and Liabilities - Total assets amounted to HKD 589.2 million as of December 31, 2022, down from HKD 911.2 million the previous year[141]. - The total assets of the company were reported at HKD 589,186,000, with total liabilities of HKD 239,261,000[163]. - Total liabilities decreased to HKD 239,261,000 in 2022 from HKD 252,300,000 in 2021[152]. - The company’s total liabilities increased to HKD 252,300 thousand in 2022 from HKD 230,485 thousand in 2021, representing an increase of about 9.5%[193]. Cash Flow and Financial Position - Operating cash outflow was HKD 90,236,000 for the year ended December 31, 2022, compared to an operating cash inflow of HKD 108,695,000 in 2021[60]. - Cash and cash equivalents decreased to HKD 38.3 million from HKD 148.6 million in the previous year[141]. - The company has sufficient operating funds to meet its financial obligations for the next twelve months[60]. - The company has a total of HKD 94,182,000 in accounts payable as of December 31, 2022, compared to HKD 29,291,000 in 2021[156]. Investments and Acquisitions - The Group completed the acquisition of a 21.88% stake in Deep Sea Health Limited for RMB 20 million on August 12, 2021[23]. - The company completed the acquisition of 51% of Pingtan Xinban Clinic for a total cash consideration of RMB 40 million (approximately HKD 47.9 million)[113]. - The group issued 24,732,032 new shares to founding shareholders in August 2022 as part of the acquisition agreement[108]. Shareholder Information - The total issued and fully paid shares as of December 31, 2022, were 13,585,339,000 ordinary shares and 240,760,000 preference shares[71]. - The group issued 77,500,000 shares under the share incentive plan during the year, with 62,500,000 shares vested and issued[86]. - Basic and diluted loss per share was HKD 1.99, compared to HKD 0.82 in the previous year[134]. Strategic Focus and Future Plans - The company aims to expand its digital marketing business for pharmaceutical companies, with plans to develop SaaS services targeting these companies this year[132]. - The company is actively pursuing partnerships with major hospitals to develop smart health management services[132]. - The company has begun assessing the impact of new or revised standards, interpretations, and amendments, with management expecting no significant impact on the financial position and operating performance[90]. Impairment and Provisions - The company incurred impairment provisions of HKD 10,152,000 in 2022, up from HKD 1,707,000 in 2021[148]. - The company has incurred impairment losses on financial assets amounting to HKD 36,492,000[160]. - The impairment test for goodwill indicated no need for impairment, as reasonable changes in assumptions would not lead to impairment[22]. Market and Industry Insights - The Chinese internet healthcare market is projected to reach RMB 162.6 billion in 2023, with a compound annual growth rate of 20% from 2020 to 2023[109]. - The company’s strategic focus on internet health transformation has begun to yield results, with significant growth in core business areas[110].

Financial Performance - The company achieved a total revenue of HKD 673 million in the first half of 2022, representing a significant increase of 170% compared to the same period last year[6]. - Total revenue for the group reached HKD 672.68 million, a significant increase of 267% compared to HKD 183.38 million in the previous year[48]. - The group reported a loss of HKD 141.08 million for the period, compared to a loss of HKD 9.01 million in the previous year[48]. - The group reported a net loss of HKD 141,081,000 for the six months ended June 30, 2022, compared to a net loss of HKD 9,009,000 in the prior year, reflecting a deterioration in financial performance[100]. - The total comprehensive loss for the period was HKD 158,621,000, compared to HKD 19,601,000 in the same period of 2021, indicating a significant increase in overall losses[102]. - The company reported a basic and diluted loss per share of HKD 0.88 for the period, compared to HKD 0.05 in the previous year, indicating a worsening loss per share[100]. - The group reported a net cash outflow from operating activities of HKD (88,270) thousand for the six months ended June 30, 2022, compared to a cash inflow of HKD 79,177 thousand for the same period in 2021[108]. Revenue Sources - The online prescription, circulation, and sales platform "Yizhi Nuo" generated revenue of HKD 229 million, while the smart health service platform "Mango Health" contributed HKD 346 million, together accounting for over 85% of total revenue[6]. - Revenue from online prescription, circulation, and marketing services reached HKD 229,059 thousand, while health consumption generated HKD 340,579 thousand during the same period[134]. - The entertainment and media segment recorded revenue of approximately HKD 44.96 million, a decrease of 65% compared to the same period last year[41]. - The health and wellness service "Beihu No. 9 Club" maintained stable revenue, recording approximately HKD 53 million despite a temporary suspension due to the pandemic[6]. Market and Strategic Focus - The entertainment and media business remains a key focus for the company, with ongoing efforts to enhance content offerings[5]. - Future outlook includes potential expansion into new markets and increased investment in film production[5]. - The company is exploring new strategies for market expansion and partnerships within the entertainment sector[5]. - The company is focusing on internet healthcare services and will not make significant investments in new film projects[6]. - The company is actively aligning with national policies to capture market opportunities in internet healthcare services[6]. - The company plans to continue exploring business model innovations in the rapidly developing smart healthcare sector[6]. Digital Transformation and Technology - Management emphasizes the importance of technological advancements in content delivery and production processes[5]. - The company aims to enhance digital marketing services, facilitating the integration of digital economy in the healthcare sector[13]. - The company is committed to enhancing its digital healthcare solutions through the integration of various healthcare stakeholders[6]. - The company plans to enhance the functionality of its online platform and continue investing in the development of new solutions to promote core business growth[19]. Corporate Governance and Compliance - The company has adhered to the corporate governance code as per the Hong Kong Stock Exchange rules, with no significant deviations reported[90]. - The audit committee, composed of three independent non-executive directors, has reviewed the unaudited interim report for the six months ending June 30, 2022, with no disagreements on accounting practices[93]. - The company continues to maintain a high level of corporate governance and compliance with relevant regulations[90]. Employee and Shareholder Information - The total number of full-time employees increased to 313 as of June 30, 2022, from 260 on December 31, 2021[70]. - The company issued 62,500,000 new ordinary shares as part of a share reward plan during the six months ended June 30, 2022[68]. - The share reward plan adopted on August 20, 2021, allows for a maximum of 10% of the company's issued share capital to be rewarded[79]. Investment and Acquisitions - The company aims to leverage strategic acquisitions to bolster its market position and content library[5]. - The company is exploring potential mergers and acquisitions to strengthen its market position and diversify its service offerings[142]. Health Sector Growth - The market size of the domestic smart healthcare industry is projected to reach RMB 376.6 billion by 2022, indicating a strong growth trajectory[6]. - The health management sector is projected to grow at a compound annual growth rate (CAGR) of 10.5%, increasing from RMB 9 trillion in 2020 to RMB 14.8 trillion by 2025[30]. - The overall health market in China is expected to maintain rapid growth due to supportive government policies and increasing health awareness among the population[34].

Revenue and Growth - The company reported a revenue exceeding HKD 36 million from the online prescription platform "Yizhi Nuo" by the end of the year[9]. - The joint venture "Mango Health" generated revenue over HKD 22 million, focusing on health management and integrating industry and consumer internet[9]. - The entertainment and media segment achieved revenue exceeding HKD 150 million, driven by digital transformation and diversified distribution channels[12]. - Total revenue for the year ended December 31, 2021, was approximately HKD 327.71 million, a significant increase of 195% compared to HKD 111.06 million in 2020[66]. - Revenue from the newly acquired/developed internet health-related businesses amounted to approximately HKD 58.64 million, accounting for 18% of total revenue for the year[68]. - Revenue from the entertainment and media segment surged 1,027% to approximately HKD 155.34 million, driven by successful film releases[66]. - The health and wellness services segment generated revenue of HKD 113.73 million, an increase of 17% compared to the previous year[66]. - The health management industry is expected to grow steadily, driven by increasing disposable income and health awareness among the population[41]. Strategic Focus and Business Development - The company plans to continue focusing on the internet healthcare business and strengthen strategic planning for long-term stable growth[12]. - The company aims to capture unprecedented opportunities arising from healthcare reform and industry digitization[10]. - The company is actively expanding its presence in the internet health market, leveraging digital solutions to connect doctors, patients, and pharmacies[16]. - The company will continue to introduce industry talents and invest more resources to accelerate the development of its healthcare service platforms[10]. - The company plans to continue expanding its internet health services and marketing efforts to enhance revenue streams and improve financial performance in the future[76]. - The company aims to provide a comprehensive digital operation solution for various stakeholders in the healthcare industry, including doctors, patients, and pharmacies[22]. - The company has established a national pharmaceutical supply chain circulation platform, collaborating with nearly 20 well-known brands in the pharmaceutical industry[36]. Market Trends and Opportunities - The global streaming media subscription users are projected to reach 1.4 billion by 2025, presenting new opportunities for the company[12]. - The online prescription and circulation service is expected to grow as the trend of separating prescription drugs from public hospitals continues, with a market size of RMB 400 billion to 500 billion in 2020[18]. - The company anticipates significant growth in online prescription and circulation services due to the implementation of electronic medical insurance and multi-point practice for doctors in 2022[31]. - The digital health service platform "Mengge Health" is expected to experience explosive revenue growth in 2022 due to successful product and service development[43]. Financial Performance and Losses - The company reported a net loss of HKD 141.43 million for the year, an increase of 150% compared to a loss of HKD 56.57 million in 2020[66]. - The adjusted loss for the year ended December 31, 2021, was HKD 114,335,000, an increase of 101% from the adjusted loss of HKD 56,892,000 in 2020, primarily due to losses from new internet health-related businesses[79]. - The overall loss for the year ended December 31, 2021, was HKD 141,427,000, compared to a loss of HKD 56,574,000 in the previous fiscal year[79]. - The entertainment and media segment recorded a loss of HKD 34.32 million, compared to a loss of HKD 13.21 million in the previous year, reflecting a 160% increase in losses[66]. Corporate Governance and Management - The company has established a green light committee to review investment projects, ensuring alignment with audience preferences and industry policies[61]. - The board of directors consists of five members, responsible for setting business goals and monitoring financial performance[120]. - The strategy committee is responsible for formulating the company's business strategy, currently chaired by an executive director[129]. - The company has adopted a board diversity policy since 2013, considering measurable factors such as gender, age, and professional experience[142]. - The company’s governance policies were reviewed by the Corporate Governance Committee, which held one meeting this year[131]. - The company is committed to maintaining high standards of corporate governance and transparency in its operations[200]. Employee and Operational Developments - The total number of full-time employees increased significantly to 260 from 21 in the previous year, primarily due to the acquisition and development of internet health-related businesses[92]. - The "Yizhi Nuo" platform expanded its team from a few dozen to nearly 200 employees by the end of 2021, establishing 9 operational centers covering 23 provinces[22]. - The "Mango Health" team has grown to over 70 members and achieved revenue exceeding HKD 22 million within a few months of operation[35]. Environmental and Social Responsibility - The company emphasized a commitment to environmental and social responsibilities, ensuring compliance with local laws and promoting sustainability[64]. - The company aims to enhance communication efficiency and protect the environment by allowing shareholders to choose their preferred method of receiving communications[184].

Financial Performance - Total revenue for the first half of 2021 reached approximately HKD 183,377,000, a 333% increase compared to HKD 42,356,000 in the same period of 2020[5] - Gross profit for the first half of 2021 was HKD 40,780,000, compared to HKD 17,456,000 in the first half of 2020[5] - The company recorded a loss attributable to shareholders of HKD 7,190,000, an improvement from a loss of HKD 11,601,000 in the same period last year[5] - The company expects multiple film releases in the second half of 2021 and into 2022, contributing to revenue growth in the entertainment and media business[37] - The group reported a pre-tax loss of HKD 9,156,000 for the six months ended June 30, 2021, compared to a loss of HKD 11,601,000 for the same period in 2020, indicating an improvement of 38.9%[174] - The total comprehensive loss for the period was HKD 19,601,000, compared to HKD 21,904,000 in the same period last year, showing a decrease of about 10.5%[108] Revenue Segmentation - The entertainment and media segment generated revenue of HKD 127,392,000, significantly up from HKD 3,665,000 in the previous year[7] - Health and wellness services revenue increased by 45% to approximately HKD 55,985,000, compared to HKD 38,691,000 in 2020[11] - The "Entertainment and Media" segment saw significant revenue growth to approximately HKD 127,392,000, up from HKD 3,665,000, driven by the releases of "Victory" and "Lost Lamb" on Netflix and Apple TV+[45] - The "Health and Wellness Services" segment recorded revenue of approximately HKD 55,985,000, a 45% increase from HKD 38,691,000 in the previous year[45] - Revenue from China reached HKD 56,487,000 for the six months ended June 30, 2021, compared to HKD 40,255,000 for the same period in 2020, representing a growth of 40.5%[164] - Revenue from other countries significantly increased to HKD 126,890,000 in the first half of 2021, up from HKD 2,101,000 in the same period of 2020[164] Investments and Acquisitions - The company acquired a 51% stake in Pingtan Xinban Clinic for RMB 40 million, with potential total acquisition costs not exceeding RMB 400 million based on performance targets[11] - The company acquired a 51% stake in Pingtan Xinban Group for RMB 40 million, with potential total acquisition costs not exceeding RMB 400 million based on performance targets[34] - The group invested in the Korean sci-fi film "Victory" which debuted on Netflix on February 5, 2021, and topped the global film rankings within two days[22] - The group’s investment in the film "Lamb" was acquired by Apple TV+ for global distribution, starting on March 12, 2021[25] - The group is actively expanding into the Chinese pharmaceutical and healthcare services market, with investments in a new retail platform "Lingyi Future" to prepare for rapid industry growth[19] Market Trends and Recovery - The overall economic growth in China showed a GDP increase of 12.7% year-on-year in the first half of 2021, indicating a strong recovery post-pandemic[12] - Over 80% of North American cinemas (4,700 theaters) have reopened, with June box office exceeding $1 billion, indicating a gradual recovery in consumer confidence[15] - The Chinese film market's box office reached RMB 27.6 billion in the first half of 2021, recovering nearly 90% compared to the same period in 2019[14] - The global entertainment and media industry is showing signs of recovery, with cinemas reopening and a shift in viewing habits towards online streaming[21] - The company is optimistic about the recovery of the global film industry as vaccination rates increase and production resumes[37] Online Streaming and Digital Transformation - The company plans to expand its online streaming presence with films released on platforms like Netflix and Apple TV+[7] - The positive response to the film "Victory" on Netflix has reinforced the company's confidence in the long-term development of Korean film and television works[29] - The user engagement on Netflix increased significantly, with the percentage of users watching over 10 hours per week rising from 16% pre-pandemic to 38%[38] - The group plans to release the animated film "Saving Sweetie" in the second half of the year, with rights sold to Netflix for further revenue generation[26] - The company aims to strengthen cooperation with various international streaming platforms to enhance online and offline film distribution[38] Financial Position and Liquidity - Cash and cash equivalents as of June 30, 2021, were approximately HKD 156,838,000, a 38% increase from HKD 113,837,000 at the end of 2020[51] - The current ratio improved from 1.64 at the end of 2020 to 2.34 as of June 30, 2021, indicating better liquidity[51] - The debt-to-equity ratio remained extremely low at 0.002 as of June 30, 2021, unchanged from the end of 2020[51] - The group reported a net foreign exchange gain of approximately HKD 1,023,000 for the period, compared to a net loss of HKD 1,342,000 in 2020[52] - The total equity as of June 30, 2021, was HKD 773,338,000, a slight decrease from HKD 776,592,000 as of December 31, 2020[113] Employee and Corporate Governance - The group employed 92 full-time employees in Hong Kong and China as of June 30, 2021, an increase from 21 employees as of December 31, 2020[56] - The group continues to manage the "Beihu No. 9 Club" business in China, employing 325 full-time employees as of June 30, 2021, up from 314 employees as of December 31, 2020[56] - The company has not appointed a chairman since March 30, 2021, with Yuan Haibo temporarily assuming the role of chairman and CEO[90] - The audit committee, consisting of three independent non-executive directors, reviewed the unaudited interim report for the six months ending June 30, 2021, with no inconsistencies in accounting treatment noted[95] - The company has adopted a code of conduct for directors regarding securities trading, which has been fully complied with by all directors[94]

Box Office Performance - The global box office revenue in 2020 was approximately $12.4 billion, a decline of 71% compared to 2019 due to the COVID-19 pandemic[13]. - China's total box office revenue reached RMB 20.417 billion (approximately $3.1 billion) in 2020, making it the highest globally[13]. - The film "The Eight Hundred," co-produced by the company, became the highest-grossing film in China and globally in 2020, generating over RMB 3.1 billion in box office revenue[41]. - The company anticipates a recovery in the film industry as vaccines are rolled out and cinemas gradually reopen[16]. - The North American box office revenue fell by approximately 80% in 2020, reaching a 40-year low due to prolonged cinema closures[37]. - The company reported that the total number of moviegoers in South Korea decreased by 73.7% in 2020, with the film industry experiencing a nearly 67% decline in economic benefits compared to 2019[38]. Company Financials - Total revenue for the year ended December 31, 2020, was approximately HKD 111,055,000, representing a 12% increase compared to HKD 99,326,000 in 2019[22]. - Gross profit for the same period was HKD 50,866,000, a significant increase of 30% from HKD 39,011,000 in 2019[22]. - The entertainment and media segment generated revenue of approximately HKD 13,780,000, a fourfold increase from HKD 2,736,000 in 2019, primarily driven by the film "The Eight Hundred" which grossed RMB 3.11 billion[24][25]. - The company reported a net loss of HKD 56,574,000 for the year, a 97% increase compared to a loss of HKD 28,770,000 in 2019[22]. - The share of profit from the associate company HB Entertainment decreased by 49% to approximately HKD 2,504,000 due to the impact of the pandemic[26][30]. - The company incurred an impairment provision of approximately HKD 25,761,000 related to its investment in HB Entertainment, leading to a segment loss of HKD 13,213,000 in the entertainment and media division[26]. - The health and wellness services segment recorded revenue of approximately HKD 97,275,000, a slight increase of 1% from HKD 96,590,000 in 2019[31]. Strategic Initiatives - The company plans to continue expanding its media entertainment business while seeking diversified opportunities for stable development[17]. - The company aims to present high-quality film projects in China, the US, and Korea, expecting to enter a harvest period[16]. - The company is actively seeking opportunities in the entertainment and media sector despite the pandemic's impact on film production[25]. - The company plans to leverage its exclusive distribution rights for "Victory" in mainland China to reach a broader audience[42]. - The company plans to explore online premiere opportunities and strengthen partnerships with various international streaming platforms[54]. - The company anticipates significant revenue growth in the entertainment and media segment as several film projects are expected to be released globally in 2021 and 2022[27]. Production and Content - The company has invested in and co-produced the Korean sci-fi film "Victory," marking a new breakthrough in the Korean film market[16]. - The company invested in the Korean sci-fi film "Victory," which was released on Netflix and became the number one film globally for two consecutive days, with a production budget of 24 billion KRW (approximately HKD 160 million)[42]. - The company's investment in the film "Lamb" was acquired by Apple TV+ for global distribution, marking its second film to be released on an online streaming platform[43]. - The company has secured the Chinese distribution rights for the sci-fi film "Chaos Walking," which features Tom Holland and Daisy Ridley, expected to be released in 2021[46]. - The company has invested in two major film productions, "Moonfall" and "Extinct," which are in post-production and expected to be released between 2021 and 2022[46]. - The company holds a 31% stake in HB Entertainment, which continues to produce quality Korean films and dramas despite challenges posed by the pandemic[46]. Market Trends and Consumer Behavior - During the Spring Festival in 2021, consumer spending increased by 28.7% compared to the same period in 2020, indicating a strong recovery in consumer purchasing power post-pandemic[33]. - The company's strategy focuses on producing high-quality films to meet market trends and consumer preferences, aiming to lead the film industry[34]. - The Korean film market is gaining global recognition, exemplified by the success of "Victory," which topped charts on Netflix, indicating significant potential for the company's joint venture HB Entertainment to produce high-quality content[56]. Corporate Governance and Compliance - The company has adopted a board diversity policy since 2013, considering measurable factors such as gender, age, and professional experience in board composition[114]. - The company has established a risk management framework since 2015, which includes oversight from the board and audit committee[135]. - The board is responsible for reviewing the effectiveness of the risk management and internal control systems annually, and they are satisfied with the results for the year ending December 31, 2020[145]. - The company has implemented a comprehensive internal control system based on the COSO framework, which is reviewed by the audit committee each year[144]. - The company emphasizes the importance of timely and fair disclosure of information to the public, adhering to strict policies regarding insider information[144]. - The company adheres to anti-corruption laws and regulations, strengthening internal controls to prevent corruption incidents and maintain stakeholder trust[66]. Employee and Talent Management - The company maintains a talent strategy focused on recruitment and training, ensuring employee safety and career development through regular training and a clear promotion pathway[63]. - The company secretary has participated in over 15 hours of relevant professional training during the year[152]. - The group employed 21 full-time employees in Hong Kong and China as of December 31, 2020, down from 27 in 2019, and managed 314 full-time employees for the "Beihu No. 9 Club" business[86]. Environmental and Social Responsibility - The company emphasizes environmental responsibility by adhering to local environmental laws and implementing management measures to minimize operational impact, promoting resource efficiency and recycling[59]. - The company will disclose its environmental, social, and governance (ESG) report to showcase its performance and commitments in these areas for the year 2020[66]. - The company will publish an Environmental, Social, and Governance (ESG) report in accordance with Listing Rule 13.91[190].