Financial Performance - For the three months ended March 31, 2023, the company reported an unaudited consolidated profit attributable to owners of approximately $50.8 million[2]. - The total revenue for the same period was $2,107.4 million, a decrease of 12.0% compared to $2,394.4 million in the same period last year[8]. - The gross profit for the three months was $497.6 million, down from $568.3 million year-on-year[3]. - The total comprehensive income for the period was $74.4 million, down from $97.1 million in the previous year[5]. - The revenue attributable to the company was $852.4 million, a slight decline of 1.2% from $862.5 million in the same period last year, but an increase of 6.5% in RMB terms[10]. - The company reported a profit attributable to shareholders of $50.8 million, a decrease of 42.6% from $88.6 million in the same period last year[14]. Revenue Breakdown - The company experienced a 16.8% decrease in revenue from footwear activities, totaling $1,159.7 million, with a 24.0% reduction in the number of pairs shipped to 53.9 million[8]. - The total revenue for the manufacturing business, including footwear, soles, and accessories, was $1,255.0 million, a decrease of 18.1% compared to the same period last year[9]. - Gross profit decreased by 12.4% to $497.6 million, with the manufacturing segment's gross profit down 19.4% to $211.4 million[11]. - The gross margin for the manufacturing business was 16.8%, a slight decrease of 0.3 percentage points compared to the same period last year[11]. Operating Costs and Expenses - The company's financing costs increased to $22.7 million from $12.1 million year-on-year[3]. - Selling and distribution expenses totaled $241.6 million, accounting for approximately 11.5% of revenue, down from 12.1% in the previous year[12]. Strategic Initiatives - The company continues to optimize production scheduling and flexibly allocate resources to balance capacity and demand amid short-term challenges[7]. - The retail subsidiary, Pou Chen, is advancing its digital transformation and enhancing omni-channel integration to improve consumer experience[7]. - The company remains optimistic about the long-term prospects of its manufacturing business despite current macroeconomic challenges and high inventory levels affecting order visibility[15]. - The company will continue to focus on cost control and cash flow management to ensure liquidity and financial stability[15]. - The company is committed to diversifying its manufacturing capacity in regions like Indonesia and India to support sustainable growth[16]. - The company aims to leverage trends in "athleisure" and premiumization to seek higher value-added orders and improve its product mix[16]. Product Pricing - The average selling price of footwear increased by 9.6% to $21.53 per pair[8]. - The company's operating income from sports/outdoor footwear accounted for 87.6% of footwear manufacturing revenue, while casual and sports sandals made up 12.4%[8].

Financial Performance - Total footwear shipments reached 272.7 million pairs, an increase of 14.4% compared to 238.3 million pairs in the previous year[5]. - Revenue for the year was $8,970.2 million, reflecting a growth of 5.1% from $8,533.3 million in the prior year[5]. - Profit attributable to shareholders surged to $296.3 million, a significant increase of 157.5% from $115.1 million in the previous year[5]. - Free cash flow increased to $703.6 million, up 297.3% from $177.1 million in the previous year[5]. - The overall revenue for the fiscal year ending December 31, 2022, increased by 5.1% to $9 billion, up from $8.5 billion in 2021[17]. - The manufacturing segment's revenue from footwear activities rose by 28.2% to $5,706.6 million, with footwear shipment volume growing by 14.4% to 272.7 million pairs[17]. - The average selling price of footwear increased by 12.0% to $20.93 per pair, reaching a historical high[18]. - The net profit attributable to shareholders surged by 157.5% to $296.3 million, reflecting improved financial conditions[18]. - The company reported a revenue of $8,970.2 million for the year ended December 31, 2022, representing a 5.1% increase compared to the previous year[28]. - Profit attributable to the owners of the company increased by 157.5% to $296.3 million, with manufacturing business profit growing by 257.0% to $288.1 million[28]. Dividends and Shareholder Returns - The company declared a final dividend of HKD 0.70 per share, a 250.0% increase from HKD 0.20 per share in the previous year[5]. - The board declared a final dividend of HK$0.70 per share for 2022, up from HK$0.20 per share in 2021[48]. - The company reported a mid-term dividend of HKD 0.40 per share for the six months ending June 30, 2022, and proposed a final dividend of HKD 0.70 per share, totaling approximately HKD 1,127,043,000[63]. Operational Efficiency and Cost Management - Selling and distribution expenses decreased to $988.5 million, representing 11.0% of revenue, down from 13.9% in 2021[37]. - The total cost of sales for the manufacturing business was $5,058.8 million, a 21.8% increase from $4,152.2 million in 2021[36]. - The company achieved significant improvements in manufacturing profitability due to economies of scale and stringent cost control measures[26]. - The company maintained a flexible capacity strategy, prioritizing quality growth and higher value-added orders amid a volatile industry environment[26]. - The company is enhancing its footwear manufacturing competitiveness by continuously reviewing brand customer order statuses and exploring new business models to mitigate operational risks[141]. Sustainability and Environmental Initiatives - The company aims to reduce greenhouse gas emissions by 46.2% by 2030 compared to the 2019 baseline[21]. - The company is actively pursuing a vision of "zero waste" and "low carbon emissions" as part of its environmental sustainability efforts[119]. - The board adopted a "Climate Change Policy" in 2021 to enhance the company's resilience to climate change risks[120]. - The company is expanding its use of renewable energy sources, including solar power and green energy procurement[120]. - The company is committed to responsible sourcing and supply chain management, ensuring compliance with international standards and promoting sustainable materials[121]. - In 2022, the company completed social responsibility assessments for 32 wholly-owned shoe factories, achieving a compliance rate of 91%[124]. Digital Transformation and Technological Advancements - The company is advancing its digital transformation strategy in both manufacturing and retail to enhance operational efficiency[19][20]. - The introduction of a new wave of SAP ERP and real-time data applications is part of the group's long-term digital transformation strategy aimed at achieving operational excellence[50]. - The company is accelerating its digital transformation and increasing investment in automated production R&D to mitigate disruptions caused by public health crises like COVID-19[143]. Market and Economic Outlook - The global economic outlook remains bleak, but there are signs of recovery in the Chinese market, which may boost consumer confidence and sales[22]. - The company continues to focus on high-value orders and agile management to navigate market challenges[18]. - Retail sales in the Greater China region contributed significantly to revenue, with a focus on stabilizing production capacity and supply amid market uncertainties[32]. Corporate Governance and Management - The company emphasizes the importance of corporate governance, with independent non-executive directors like Mr. Wang Ke-Qin and Mr. He Li-Kang bringing over 30 years of experience in auditing and banking[58]. - The company has a strong management team with extensive experience in finance and accounting, including Mr. Jan Lu-Ming, who has 42 years of experience in financial accounting[55]. - The company has established a comprehensive framework of policies and procedures to maintain high standards of corporate governance[182]. - The board consists of ten directors, with four being independent non-executive directors, meeting the requirement of at least three independent directors[198]. Employee Engagement and Talent Development - The company emphasizes talent development and retention, implementing systematic training and career development programs to ensure sustainable leadership[135]. - The company has a robust employee retention system and training programs to ensure leadership continuity and skill development[146]. - The company faces challenges in recruiting and retaining new management talent due to high turnover rates and the competitive job market[135]. Community Engagement and Social Responsibility - The company invested approximately $81,000 in community engagement activities in 2022, focusing on education, healthcare, and local relations[126]. - The company recognizes the importance of community relations and actively participates in local activities to enhance social living standards and foster harmonious relationships[126]. Risk Management and Compliance - The company has implemented a foreign exchange hedging policy to mitigate risks associated with currency fluctuations affecting production costs and operating performance[145]. - The company is committed to compliance with evolving regulations and has established governance policies to ensure ethical conduct[177]. - The company has maintained compliance with all relevant laws and regulations in key operating regions, including China, Vietnam, Indonesia, Cambodia, Bangladesh, and Myanmar, as of December 31, 2022[127].

Financial Performance - Revenue for the year ended December 31, 2022, was $8,970,228 thousand, representing a 5.12% increase from $8,533,337 thousand in 2021[2] - The recurring profit attributable to shareholders was $291,874 thousand, a significant increase of 363.13% compared to $63,022 thousand in the previous year[2] - The total profit attributable to shareholders reached $296,347 thousand, up 157.53% from $115,072 thousand in 2021[2] - Basic earnings per share increased to 18.41 cents, a rise of 157.48% from 7.15 cents in the prior year[2] - Total comprehensive income for the year was $169,665 thousand, down from $239,783 thousand in 2021[5] - The company reported a total of $106,297 thousand in income tax expenses for the year, compared to $63,159 thousand in 2021[18] - The company recorded a significant increase in recurring profit attributable to shareholders, rising 363.1% to $291.9 million[42] - Profit attributable to the owners of the company increased by 157.5% to $296.3 million, with manufacturing business profit growing by 257.0% to $288.1 million[32] Revenue Breakdown - Revenue from manufacturing business was $6,203,137 thousand, up 26.2% from $4,914,043 thousand in the previous year[13] - Retail business revenue decreased to $2,767,091 thousand, down 23.6% from $3,619,294 thousand in 2021[13] - Revenue from sports/outdoor shoes was $4,890,553 thousand, a 30.0% increase from $3,762,196 thousand in 2021[14] - Revenue from the United States was $2,043,360 thousand, an increase of 20.8% from $1,691,480 thousand in 2021[16] - Revenue from China decreased to $3,646,284 thousand, down 18.1% from $4,452,730 thousand in the previous year[16] - Major customer A contributed $2,202,664 thousand in revenue, up 25.4% from $1,755,185 thousand in 2021[18] Assets and Liabilities - Non-current assets totaled $3,791,896 thousand, a decrease from $4,118,673 thousand in the previous year[6] - Current assets decreased to $4,143,525 thousand from $4,519,411 thousand in 2021[7] - Total liabilities decreased to $3,289,096 thousand from $3,933,633 thousand in the previous year[7] - The net asset value attributable to shareholders increased to $4,189,711 thousand from $4,098,458 thousand in 2021[7] - Non-current assets in China decreased to $1,092,324 thousand from $1,301,736 thousand in the previous year[17] Dividends - The proposed final dividend was increased to HKD 0.70, a 250.00% increase from HKD 0.20 in the previous year[2] - The company declared a final dividend of HKD 0.70 per share for the year ended December 31, 2022, up from HKD 0.20 per share in 2021, totaling approximately HKD 1,127,043,000[21] - The board declared a final dividend of HK$0.70 per share for 2022, up from HK$0.20 per share in 2021[52] Expenses and Costs - Employee benefits expenses increased to $2,262,412,000 in 2022 from $2,136,352,000 in 2021, reflecting a rise of approximately 5.9%[19] - The total research and development expenses for 2022 were $189,742,000, slightly up from $185,430,000 in 2021[19] - The inventory provision change for 2022 was $11,286,000, compared to $5,031,000 in 2021, indicating an increase in inventory-related costs[20] - Accounts payable and other payables decreased to $426,930,000 in 2022 from $648,527,000 in 2021, showing a reduction of approximately 34%[25] - The main material costs totaled $2,368.2 million, representing 46.8% of total sales costs, which increased by 21.8% year-over-year[40] Cash Flow and Capital Expenditure - Cash generated from operating activities was $907.9 million, significantly up from $463.1 million in the previous year, with free cash flow reaching $703.6 million[44] - The group's total capital expenditure for 2022 was $204.3 million, a decrease from $286.0 million in 2021, with manufacturing capital expenditure at $158.0 million[47] - The capital expenditure for the retail business dropped to $46.3 million in 2022 from $70.1 million in 2021, aligning with the channel optimization strategy[47] Strategic Initiatives - The group maintains an optimistic long-term outlook for its manufacturing business despite challenges such as inflation and rising interest rates impacting global demand visibility[56] - The group plans to actively manage its supply chain and production capacity to balance demand and labor supply amid uncertain short-term demand for footwear[56] - The group aims to diversify its manufacturing capacity in regions like Indonesia to support sustainable growth when demand recovers[56] - The implementation of a new SAP ERP system and real-time data applications is part of the group's long-term digital transformation strategy to achieve operational excellence[57] - The group is focused on enhancing its growth strategy and digital transformation to strengthen its omnichannel presence and upgrade physical stores[57] Employee and Governance - The group employed approximately 310,000 employees as of December 31, 2022, a decrease of 2.3% from about 317,200 employees a year earlier[53] - The company has adopted the principles of the corporate governance code and complied with all applicable provisions during the fiscal year ending December 31, 2022[59] - The company will hold its annual general meeting on May 25, 2023, to discuss various corporate matters, including the re-election of directors[64]

Financial Performance - For the nine months ended September 30, 2022, the unaudited consolidated profit attributable to owners of the company was approximately $270.1 million[2]. - Revenue for the nine months ended September 30, 2022, was $6,971.8 million, an increase from $6,441.2 million in the same period of 2021, representing a growth of 8.2%[3]. - Gross profit for the nine months ended September 30, 2022, was $1,657.9 million, compared to $1,560.3 million in 2021, reflecting a gross margin improvement[3]. - The company reported a pre-tax profit of $353.4 million for the nine months ended September 30, 2022, compared to $175.8 million in the same period of 2021, indicating a significant increase[3]. - The company’s attributable profit for the nine months ended September 30, 2022, was $270.1 million, a 171.2% increase from $99.6 million in the same period last year[14]. - The total comprehensive income for the nine months ended September 30, 2022, was $88.7 million, a decrease from $176.9 million in the same period of 2021[5]. Revenue and Sales - Revenue from footwear activities increased by 33.0% to $4,389.1 million, driven by strong global demand and a significant increase in shipment volume by 19.0% to 213.0 million pairs[8]. - The company’s total revenue from manufacturing operations, including footwear and accessories, was $4,793.4 million, an increase of 31.1% year-on-year[8]. - The average selling price of footwear increased by 11.8% to $20.61 per pair, reflecting a focus on high-value orders and product mix optimization[8]. - The company’s sales and distribution expenses totaled $773.0 million, accounting for approximately 11.1% of revenue, down from 13.7% in the previous year[12]. Operational Insights - The retail subsidiary, Pou Chen Corporation, experienced a gradual improvement in foot traffic, although the retail market atmosphere remained volatile due to stricter COVID-19 control measures[7]. - The company continues to optimize its online channels to mitigate the impact of weak physical sales and enhance interaction with consumers and business partners[7]. - The company emphasized a focus on quality growth and higher value-added orders, leveraging ongoing trends in "athleisure" and premiumization[7]. Costs and Expenses - The company’s financing costs increased to $45.8 million for the nine months ended September 30, 2022, compared to $39.0 million in the previous year[3]. - Other income for the nine months ended September 30, 2022, was $89.4 million, slightly down from $97.0 million in the same period of 2021[3]. Future Outlook - The company remains cautiously optimistic about the long-term development of its manufacturing business despite global economic uncertainties and inflation risks[16]. - The company plans to diversify its manufacturing capacity in Southeast Asia, particularly in Indonesia, to support sustainable growth[16]. - The company recorded a significant increase in profit from associates and joint ventures, reaching $54.2 million, nearly doubling from $27.4 million in the previous year[13].

Financial Performance - Revenue decreased by 2.0% to $4,709.8 million from $4,807.1 million year-on-year[7] - Gross profit declined by 11.5% to $1,095.7 million, resulting in a gross margin of 23.3%, down from 25.8%[7] - EBITDA decreased by 15.1% to $461.9 million compared to $543.9 million in the previous year[7] - Profit attributable to equity holders increased by 2.8% to $175.0 million, with basic earnings per share rising to 10.87 cents from 10.57 cents[7] - The net profit for the six months ended June 30, 2022, was $176,474 thousand, a decline of 16.2% from $210,617 thousand in the prior year[13] - The group reported a net profit for the six months ended June 30, 2022, of $175,049,000, compared to $170,255,000 in the same period of 2021, reflecting a 2.2% increase[35] Shipments and Sales - Total footwear shipments increased by 5.6% to 144.1 million pairs compared to 136.4 million pairs in the same period last year[7] - Revenue from footwear activities increased by 16.0% to $2,905.9 million, with a 5.6% rise in footwear shipments to 144.1 million pairs and an average selling price increase of 9.7% to $20.16 per pair[58] - Revenue from sports/outdoor shoes increased to $2,465,170 thousand from $2,081,424 thousand, indicating strong demand in this segment[27] - The retail subsidiary, Bao Sheng, saw a revenue decline of 24.7% to $1,520.9 million, impacted by COVID-19 lockdowns and reduced foot traffic[58] Dividends and Shareholder Returns - The company declared an interim dividend of HKD 0.40 per share, not applicable in the previous year[7] - The group emphasizes maintaining a stable dividend policy to ensure sustainable returns for shareholders[76] Liquidity and Financial Ratios - The current ratio improved to 1.9 from 1.8, reflecting better short-term liquidity[7] - The debt ratio increased to 41.1% from 37.3% year-on-year, indicating a rise in leverage[7] - The group's net debt was $1,131.4 million with a net debt-to-equity ratio of 24.3%, up from $879.1 million and 19.1% as of December 31, 2021[68] Operational Efficiency and Cost Management - Selling and distribution expenses decreased by 12.4% to $538.6 million, accounting for approximately 11.4% of total revenue[64] - The cost of goods sold for manufacturing was $2,632.1 million, a 15.5% increase from $2,278.0 million in the previous year, with major material costs rising by 19.2%[63] - The total employee costs for the period were $1,170,303,000, an increase from $1,117,413,000 in the previous year[33] Market Presence and Strategic Focus - The company is focused on expanding its market presence and enhancing product development strategies[11] - The group plans to diversify its manufacturing capacity in Southeast Asia, particularly in Indonesia, to support sustainable growth and address labor supply and infrastructure needs[74] - The group aims to enhance operational efficiency and productivity through digital transformation strategies, including the implementation of a new SAP ERP system and real-time data applications[74] Environmental Commitment - The group aims to achieve zero growth in greenhouse gas emissions by 2025 compared to the 2019 baseline, with a target of a 46.2% reduction by 2030[56] - The group was recognized as one of the "Climate Leaders" in the Asia-Pacific region, achieving a 6.3% annual compound reduction in greenhouse gas emissions intensity from 2015 to 2020[56] Corporate Governance - The company has maintained compliance with the corporate governance code as per the listing rules during the six months ending June 30, 2022[100] - The board of directors includes six executive directors and four independent non-executive directors as of the report date[101] - The company is committed to high levels of corporate governance through transparency and accountability[100]

Financial Performance - For the three months ended March 31, 2022, the company reported an unaudited consolidated profit attributable to owners of approximately $88.6 million[2]. - The company's revenue for the same period was $2,394.4 million, a decrease of 4.0% compared to $2,493.3 million in the same period last year[8]. - Gross profit for the three months was $568.3 million, with a gross margin of approximately 23.7%[3]. - The company reported a total comprehensive income of $97.1 million for the period, compared to $91.96 million in the previous year[5]. - The company reported a profit attributable to shareholders of $88.6 million, an increase of 3.7% from $85.4 million in the same period last year[13]. Revenue Breakdown - The company achieved a 14.8% increase in revenue from footwear activities, totaling $1,394.2 million, driven by strong global demand[8]. - In the first three months of 2022, the group's sports/outdoor footwear accounted for 85.0% of footwear manufacturing revenue, while casual shoes and sports sandals accounted for 15.0%[9]. - The total revenue from the group's manufacturing business was $1,531.9 million, representing a 12.2% increase compared to the same period last year[9]. - The group's total revenue for the first three months of 2022 was $2,394.4 million, a decrease of 4.0% from $2,493.3 million in the same period last year[10]. Gross Profit and Margins - Gross profit decreased by 10.5% to $568.3 million, with a gross profit margin of 17.1%, down 1.1 percentage points year-on-year[11]. - The gross profit margin for the group’s subsidiary, BaoSheng, improved by 1.2 percentage points to 35.5% due to better channel mix and cautious discounting in a volatile retail environment[12]. Operating Expenses - The company's operating expenses decreased, with selling and distribution expenses at $290.2 million, down from $319.9 million year-on-year[3]. - Selling and distribution expenses totaled $290.2 million, accounting for approximately 12.1% of revenue, down from 12.8% in the previous year[12]. Strategic Focus - The company continues to prioritize quality growth and higher-value orders, leveraging trends in "athleisure" and premiumization[7]. - The company is advancing its digital transformation strategy to enhance online engagement and operational efficiency in response to retail challenges[7]. - The company maintains a cautiously optimistic outlook for continued growth in its manufacturing business, despite short-term risks from COVID-19 in mainland China and labor supply issues in Southeast Asia[15]. - The company will continue to monitor future order conditions and adapt to uncertainties in the global market, focusing on operational efficiency and productivity[16]. - The group aims to strengthen its sustainable growth and profitability through excellence in manufacturing and digital transformation strategies[16]. Challenges - The retail subsidiary, Pou Chen Corporation, faced challenges due to COVID-19 resurgence in mainland China, impacting store operations and customer traffic[7]. - The company continues to monitor future order conditions and adapt to uncertainties in the global market, focusing on operational efficiency and productivity[16].

Financial Performance - Revenue for the year was $8,533.3 million, representing a 1.0% increase from $8,444.9 million in 2020[6]. - Profit attributable to owners of the company was $115.1 million, a significant recovery from a loss of $90.8 million in 2020[6]. - EBITDA rose by 37.9% to $727.4 million from $527.5 million in 2020[6]. - The overall consolidated revenue for the fiscal year ended December 31, 2021, increased by 1.0% to $8.5 billion, compared to $8.4 billion in 2020[19]. - The group recorded a revenue of $8,533.3 million for the year ended December 31, 2021, representing a 1.0% increase compared to the previous year[26]. - The average selling price of footwear increased by 4.4% to $18.68 per pair, despite a 2.5% decrease in the number of pairs shipped, totaling 238.3 million pairs[28]. - Revenue from footwear manufacturing activities increased by 1.8% to $4,450.5 million, with sports/outdoor shoes accounting for 84.5% of footwear manufacturing revenue[28]. - Gross profit increased by 11.9% to $2,048.2 million, with an overall gross margin rising by 2.3 percentage points to 24.0%[33]. - Net profit margin rose to 1.7% in FY2021 compared to (0.9)% in FY2020, indicating a recovery in profitability[110]. Cash Flow and Capital Expenditure - Free cash flow decreased by 69.4% to $177.1 million from $578.9 million in the previous year[6]. - Capital expenditure increased by 12.0% to $286.0 million compared to $255.3 million in 2020[6]. - Cash flow from operating activities was $463.1 million, down from $834.2 million in 2020, with free cash flow at $177.1 million[39]. - The group's total capital expenditure for 2021 reached $286.0 million, an increase from $255.3 million in 2020, with manufacturing capital expenditure at $215.9 million, up from $170.6 million in 2020[43]. Debt and Equity - The total equity increased by 5.3% to $4,604.5 million from $4,374.1 million in 2020[6]. - The debt ratio improved to 37.3%, down from 42.7% in the previous year, reflecting a 12.6% decrease[6]. - The debt-to-equity ratio improved to 37.3% from 42.7% in the previous year[40]. - The net debt to equity ratio improved to 19.1% in FY2021 from 22.2% in FY2020, indicating a stronger balance sheet[110]. Sustainability and Environmental Goals - The company aims to reduce greenhouse gas emissions by 46.2% by 2030 compared to the 2019 baseline as part of its commitment to sustainability[21]. - The company is committed to achieving net-zero emissions by mid-century, aligning with the goals set at the UNFCCC COP26 and the Paris Agreement[116]. - The company has implemented a series of management policies to enhance resource efficiency and reduce environmental impact in its footwear business[112]. - The company is focusing on local suppliers to minimize supply chain disruptions and reduce carbon emissions from transportation[113]. Digital Transformation and Innovation - The company plans to enhance its digital transformation strategy, focusing on innovation, digitalization, and automation to strengthen its core competitiveness[20]. - The company is focused on digital transformation, including the implementation of a third-phase SAP ERP system to drive operational excellence[49]. - Investments in business intelligence systems and digital tools are expected to support operations and improve customer experience[50]. Market and Sales Strategy - The global sports goods industry is expected to grow at a compound annual growth rate (CAGR) of 8% to 10% until 2025, with the Chinese market projected to grow at a CAGR of 13.7% during the same period[19]. - In 2021, the contribution of omnichannel sales to the company's overall revenue reached 21%, with 4,631 directly operated retail stores and 3,786 franchised stores in Greater China by year-end[20]. - The company aims to prioritize value growth over pure sales growth, seeking high-value orders to improve product mix[49]. Employee and Management - The company continues to prioritize employee health, safety, and well-being while gradually increasing production capacity in a safe and orderly manner[19]. - As of December 31, 2021, the group employed approximately 317,200 employees, a 6.3% increase from about 298,500 employees at the end of 2020[48]. - The company has a strong management team with extensive experience in finance and accounting, including members with over 20 years of experience in the field[58]. Governance and Compliance - The company adopted the principles of the original Corporate Governance Code and complied with all applicable code provisions for the year ended December 31, 2021[163]. - The board held a total of seven meetings and one annual general meeting during the year ended December 31, 2021[166]. - The company has established appropriate insurance arrangements for directors against liabilities arising from corporate affairs, with no claims made against directors during the year[171]. Risk Management - The company is actively monitoring macroeconomic conditions and potential risks, particularly related to COVID-19 and labor supply in Southeast Asia[49]. - The company has established a sustainable development department to manage environmental risks and ensure operational continuity during severe weather events[142]. - Currency fluctuations pose a risk to the company's costs and operating performance, leading to the implementation of currency hedging strategies[144]. Community Engagement and Social Responsibility - The company actively participates in community development initiatives, focusing on quality education, health, and poverty alleviation[129]. - The group made charitable donations totaling approximately USD 5.2 million for the year ended December 31, 2021[63].

Financial Performance - Revenue for the six months ended June 30, 2021, was $4,807,087 thousand, representing a 17.66% increase from $4,085,633 thousand in the same period of 2020[9]. - The profit attributable to owners of the company for the same period was $170,255 thousand, compared to a loss of $136,758 thousand in 2020, indicating a significant turnaround[9]. - Basic earnings per share for the period was 10.57 cents, compared to a loss of 8.49 cents per share in the previous year[9]. - Gross profit for the six months was $1,238,414 thousand, up from $833,081 thousand in the prior year, reflecting improved operational efficiency[14]. - Other income increased to $64,670 thousand from $46,839 thousand, contributing positively to overall financial performance[14]. - Financing costs decreased to $27,312 thousand from $37,866 thousand, indicating better management of financial expenses[14]. - The company reported a pre-tax profit of $272,057 thousand, a significant recovery from a pre-tax loss of $137,128 thousand in the previous year[14]. - Non-controlling interests contributed $40,362 thousand to the profit, compared to $11 thousand in the same period last year, showing growth in subsidiary performance[14]. - The company reported a profit of $210,617 thousand for the six months ended June 30, 2021, compared to a loss of $136,747 thousand in the same period of 2020, representing a significant turnaround[15]. - Total comprehensive income for the period amounted to $233,413 thousand, compared to a loss of $173,559 thousand in the previous year, indicating a strong recovery[15]. Assets and Liabilities - Non-current assets totaled $4,204,126 thousand as of June 30, 2021, slightly down from $4,286,969 thousand at the end of 2020[16]. - Current assets increased to $4,405,352 thousand from $4,213,750 thousand, reflecting improved liquidity[16]. - Current liabilities decreased to $2,216,230 thousand from $2,337,869 thousand, indicating better management of short-term obligations[17]. - The company's net asset value rose to $4,603,098 thousand from $4,374,142 thousand, showcasing growth in shareholder equity[17]. - Inventory levels increased to $1,623,307 thousand from $1,584,934 thousand, suggesting a strategic buildup in stock[16]. - The company’s cash and cash equivalents stood at $926,855 thousand, up from $896,977 thousand, enhancing its cash position[16]. - The equity attributable to owners of the company increased to $4,084,393 thousand from $3,895,854 thousand, indicating a solid growth in equity base[17]. - The total equity as of June 30, 2021, was $4,603,098,000, reflecting an increase from $4,374,142,000 as of January 1, 2021[18]. Cash Flow and Investments - For the six months ended June 30, 2021, the net cash generated from operating activities was $225,950,000, a decrease of 19.5% compared to $280,769,000 for the same period in 2020[20]. - The net cash used in investing activities was $(109,454,000), down from $(132,621,000) in the previous year, indicating a reduction in investment outflows[21]. - The net cash generated from financing activities was $(88,464,000), compared to $(16,992,000) in the prior year, reflecting increased financing costs[22]. - The total cash and cash equivalents at the end of the period were $926,855,000, down from $1,107,385,000 at the end of the previous year[22]. Revenue Breakdown - Revenue from the manufacturing business was $2,786,584 thousand, up 15.2% from $2,418,465 thousand in 2020, while retail business revenue increased by 21.2% to $2,020,503 thousand from $1,667,168 thousand[30]. - Revenue from the US market was $969,793 thousand, a significant increase of 42.7% from $679,269 thousand in 2020, while revenue from China rose to $2,483,138 thousand, up 18.4% from $2,098,407 thousand[33]. - Revenue from footwear activities increased by 11.8% to $2,505.5 million, driven by a recovery in demand and an increase in shipment volume by 5.0% to 136.4 million pairs[65]. Operational Efficiency and Future Plans - The company plans to continue expanding its market presence and investing in new product development to sustain growth momentum[13]. - Future guidance indicates a focus on enhancing operational efficiencies and exploring strategic acquisitions to bolster market position[13]. - The company plans to continue evaluating the potential impacts of accounting policy changes related to inventory sales costs, which may affect future financial statements[27]. - The company is implementing the third phase of the SAP ERP system as part of its digital transformation strategy to enhance manufacturing excellence[85]. - The company aims to optimize its manufacturing capacity and production capabilities to adapt to rapidly changing market demands, including shorter production lead times and improved order fulfillment capabilities[85]. Employee and Cost Management - The total employee costs for the first half of 2021 were $1,117,413 thousand, a slight decrease from $1,167,005 thousand in 2020[36]. - The group employed approximately 303,800 employees as of June 30, 2021, a decrease of 4.7% from about 318,800 employees a year earlier[82]. - The manufacturing cost of goods sold increased to $2,278.0 million, up from $2,085.2 million in the previous year, reflecting higher material and labor costs[70]. Shareholder and Governance - The company did not declare an interim dividend for the first half of 2021, consistent with the decision made in 2020[37]. - The company has adopted a share option plan effective from May 31, 2019, allowing the board to grant options to eligible participants, with a total of 161,449,998 shares available for issuance under this plan, representing approximately 10.01% of the issued shares[92]. - The board of directors includes both executive and independent non-executive members, ensuring a diverse governance structure[113]. - Deloitte has issued a review report without reservation for the interim financial information for the six months ended June 30, 2021[111]. Market Outlook - The company maintains a cautious optimism regarding the recovery of demand for its manufacturing business, despite operational risks due to COVID-19 in Southeast Asia[84]. - The retail business is cautiously optimistic about long-term growth prospects driven by digital transformation and multi-channel integration, despite short-term market volatility[85].

Financial Performance - Total footwear shipments decreased by 24.2% to 244.4 million pairs in 2020 compared to 322.4 million pairs in 2019[8]. - Revenue declined by 16.4% to $8,444.9 million in 2020 from $10,105.4 million in 2019[8]. - The company reported a loss attributable to shareholders of $90.8 million in 2020, compared to a profit of $300.5 million in 2019[8]. - The group's consolidated revenue for the fiscal year ended December 31, 2020, decreased by 16.4% to $8.4 billion compared to $10.1 billion in 2019[22]. - The company recorded a loss attributable to shareholders of $90.8 million in 2020, compared to a profit in 2019[22]. - The company reported a revenue of $8,444.9 million for the year ended December 31, 2020, a decrease of 16.4% compared to the previous year, primarily due to the impact of COVID-19[31]. - The company experienced a loss attributable to shareholders of $90.8 million, compared to a profit of $300.5 million in the previous year, resulting in a basic loss per share of 5.64 cents[31]. - The gross profit for the group decreased by 27.1% to $1,831.0 million, with a manufacturing gross margin narrowing by 3.8 percentage points to 14.7%[37]. - The company incurred significant one-time costs of approximately $107 million due to strategic production adjustments, including the closure of facilities in Hubei, China, and temporary reductions in manufacturing capacity in Southeast Asia[31]. - The company reported a significant increase in revenue, with a year-on-year growth of 15% in the last fiscal year[57]. - The company reported a loss of $72,361 thousand for the year 2020, compared to a profit of $353,000 thousand in 2019, indicating a significant decline in performance[197]. - Total comprehensive income for the year was $6,875 thousand, down from $340,923 thousand in the previous year, reflecting a drastic reduction in overall profitability[197]. Cash Flow and Investments - Free cash flow increased by 45.7% to $578.9 million in 2020, up from $397.4 million in 2019[8]. - Capital expenditures decreased by 35.6% to $255.3 million in 2020 from $396.2 million in 2019[8]. - The company plans to restore its capital expenditure plans and adjust production capacity to more competitive regions as conditions improve[22]. - Capital expenditures and long-term investments were primarily funded through long-term bank loans, with 69.2% of borrowings having a remaining term of over one year[44]. - In 2020, product development expenditures reached $187.1 million, focusing on high-tech and digital development to enhance production efficiency[41]. - Capital expenditure for manufacturing and retail businesses in 2020 was $170.6 million and $84.7 million, respectively, down from $279.3 million and $115.4 million in 2019[45]. Debt and Equity - The company's total equity decreased by 3.5% to $4,374.1 million in 2020 from $4,533.1 million in 2019[8]. - The debt ratio improved to 42.7% in 2020 from 46.1% in 2019, a decrease of 7.4%[8]. - The net debt-to-equity ratio improved to 22.2% in 2020 from 24.4% in 2019, indicating a stronger balance sheet[109]. - The company decided not to declare a final dividend for the year ending December 31, 2020, compared to a dividend of HK$0.70 per share in 2019, to retain cash amid economic uncertainty[49]. Operational Efficiency - Selling and distribution expenses decreased to $1,079.2 million, accounting for approximately 12.8% of revenue, compared to 12.1% in 2019[38]. - Administrative expenses were $546.7 million, representing about 6.5% of revenue, down from 6.8% in 2019[38]. - The company has enhanced its online logistics and diversified B2C channels, including launching a WeChat store to improve cross-platform synergy and performance[31]. - The company is investing $30 million in research and development for new technologies aimed at enhancing product efficiency[58]. - The company is planning to invest in automation and enterprise resource planning systems like SAP to enhance operational efficiency[108]. Market Trends and Strategies - The sports goods market is expected to improve in 2021, with a projected five-year compound annual growth rate of 10-15% in the Chinese sports footwear and apparel market[23]. - The company anticipates continued improvement in business performance in 2021, supported by global demand recovery, despite ongoing volatility due to COVID-19 variants in North America and Europe[51]. - Focus for 2021 will be on efficiency and profit improvement, with a cautious approach to gradually increase production capacity in Southeast Asia[51]. - The company aims to enhance product development and innovation capabilities while exploring opportunities for vertical integration to create long-term synergies[51]. - The company is considering strategic acquisitions to bolster its market position, with a budget of $100 million allocated for potential deals[57]. Corporate Governance - The company emphasizes its commitment to maintaining high standards in corporate governance, as evidenced by the appointment of experienced independent directors[60]. - The board of directors has maintained a high level of corporate governance, adhering to applicable codes and standards[137]. - The company has a clear policy for the appointment of new directors, requiring recommendations from the nomination committee and approval by shareholders[151]. - The company has adopted a shareholder communication policy to ensure timely and equal access to information for shareholders and investors[174]. - The company has made appropriate insurance arrangements for directors against liabilities arising from corporate affairs, with no claims reported for the year ended December 31, 2020[149]. Risk Management - The company faces increased costs in wages, rent, services, and utilities, impacting overall profitability[129]. - The company is experiencing challenges in managing a large number of production line employees, which may affect operational efficiency[130]. - The company is facing currency exchange risks, as part of its production costs are denominated in local currencies while revenues are primarily in USD[130]. - The company has noted a shift in consumer shopping habits from offline to online channels, which may lead to increased operational costs and customer attrition[132]. - The group has established a risk assessment system to identify, assess, and manage significant risks, categorizing them into financial and non-financial risk factors[177]. Sustainability and Social Responsibility - The company remains committed to sustainable development and ethical practices, receiving Fair Labor Association certification for its labor rights efforts[31]. - The company is committed to achieving zero growth in carbon emissions by 2025, with a focus on expanding green energy usage[112]. - The group actively participates in community service activities, focusing on education, healthcare, and local public relations[124]. - The company is committed to high-quality and safe products, continuously innovating and optimizing production processes to enhance flexibility and customization for clients[116]. - The group emphasizes quality and sustainability in supplier management, with 11 quality management assessment items and 12 sustainability management assessment items[118].

Financial Performance - Revenue for the six months ended June 30, 2020, was $4,085,633 thousand, a decrease of 19.43% compared to $5,070,727 thousand in 2019[8] - The company reported a loss attributable to owners of the company of $(136,758) thousand, compared to a profit of $165,877 thousand in the same period of 2019[8] - Basic loss per share was $(8.49), down from earnings of $10.28 per share in the prior year[8] - The gross profit for the six months ended June 30, 2020, was $833,081 thousand, down from $1,272,637 thousand in 2019[14] - The company reported a pre-tax loss of $(137,128) thousand, compared to a profit of $234,125 thousand in the same period of 2019[14] - Total comprehensive loss for the period amounted to $173.559 million, a significant decrease from a total comprehensive income of $205.885 million in the previous year[16] - The company reported a loss of $136.747 million for the six months ended June 30, 2020, compared to a profit of $194.816 million in the same period of 2019[16] - The net loss for the six months ended June 30, 2020, was $(136,758), compared to a profit of $165,877 for the same period in 2019, indicating a significant decline in profitability[45] Expenses and Cost Management - Selling and distribution expenses decreased to $(480,227) thousand from $(622,946) thousand in the previous year, reflecting a reduction of 22.83%[14] - Administrative expenses were $(303,040) thousand, a decrease from $(337,194) thousand in 2019, indicating a reduction of 10.13%[14] - Other income for the six months ended June 30, 2020, was $46,839 thousand, down from $60,874 thousand in 2019[14] - The company’s financing costs decreased to $(37,866) thousand from $(48,811) thousand in the previous year, reflecting a reduction of 22.49%[14] - The company reported a decrease in interest paid, which was $28,496 thousand compared to $40,573 thousand in the previous year, reflecting a reduction of approximately 29.9%[22] - Total employee costs for the six months ended June 30, 2020, were $1,167,005, compared to $1,206,246 for the same period in 2019, reflecting a decrease of approximately 3.2%[42] - Research and development expenses amounted to $95,394 for the six months ended June 30, 2020, down from $101,860 in 2019, representing a decrease of approximately 6.5%[42] Dividends and Shareholder Returns - The company did not declare an interim dividend for 2020, compared to an interim dividend of HKD 0.40 in 2019, representing a 100% decrease[8] - The company declared dividends totaling $227,003,000 during the reporting period[19] - The company has decided not to declare an interim dividend for the six months ending June 30, 2020, maintaining a focus on stable cash flow and appropriate cash reserves[92] - The company is committed to maintaining a relatively stable level of dividend policy in the long term despite the impact of COVID-19[92] Assets and Liabilities - Non-current assets decreased to $4.204 billion as of June 30, 2020, down from $4.297 billion at the end of 2019, reflecting a decline of approximately 2.15%[17] - Current assets also decreased to $4.093 billion from $4.448 billion, representing a decline of about 7.99%[17] - The company's inventory decreased to $1.359 billion, down from $1.823 billion, indicating a reduction of approximately 25.5%[18] - Current liabilities decreased to $2.342 billion from $2.459 billion, a reduction of about 4.75%[18] - The net asset value of the company decreased to $4.214 billion from $4.533 billion, reflecting a decline of approximately 7.05%[18] - The company’s total liabilities decreased to $4.105 billion from $4.493 billion, indicating a reduction of about 8.63%[18] - The total amount of receivables as of June 30, 2020, was $1,111,814, a decrease from $1,141,786 as of December 31, 2019, indicating a reduction of approximately 2.6%[51] Cash Flow and Financing Activities - The net cash generated from operating activities for the six months ended June 30, 2020, was $280,769 thousand, a decrease from $298,795 thousand in the same period of 2019, representing a decline of approximately 6.8%[21] - The net cash used in investing activities was $(132,621) thousand, compared to $(52,091) thousand in the prior year, indicating a significant increase in investment outflows[22] - The net cash used in financing activities amounted to $(1,280,210) thousand, down from $(1,514,610) thousand in 2019, reflecting a reduction of approximately 15.4%[22] - The total cash and cash equivalents at the end of the period were $1,107,385 thousand, an increase from $785,423 thousand at the end of the previous year, marking a growth of approximately 40.9%[23] - The group obtained and repaid bank and other borrowings amounting to approximately $1,518,300,000 and $1,280,210,000 respectively during the reporting period[55] Operational Challenges and Strategic Adjustments - The company faced operational challenges due to COVID-19, leading to temporary factory closures and increased costs, including severance payments of approximately $84 million[25] - The company adjusted its production capacity in Southeast Asia to respond to ongoing uncertainties and low visibility in customer demand[25] - Retail operations in China were largely suspended in Q1 2020, resulting in decreased revenue and gross profit during the period[25] - The company adopted a more cautious approach to capital expenditure during the period to safeguard cash flow amid the pandemic[25] - The group adjusted its production capacity and closed a manufacturing facility in Hubei, China, in response to the operational challenges posed by COVID-19[74] - The group is actively monitoring macroeconomic and geopolitical conditions, particularly the tensions between the U.S. and China, which may introduce further uncertainties[90] Share Options and Employee Incentives - The total number of shares available for issuance under the Yu Yuan Share Option Plan is 161,449,998 shares, representing approximately 10.01% of the company's issued shares[99] - The maximum number of shares that can be issued to any participant under the Yu Yuan Share Option Plan within any twelve-month period cannot exceed 1% of the company's issued shares[99] - The total number of reward shares available under the Yu Yuan Share Award Plan is limited to 2% of the company's issued share capital at the time of grant[101] - The maximum number of shares that can be granted to any selected participant under the Yu Yuan Share Award Plan is capped at 1% of the company's issued share capital[101] - The total number of unexercised reward shares was 1,156,500 shares after accounting for grants and cancellations during the period[103] Corporate Governance and Compliance - The external auditor reviewed the interim financial statements for the six months ended June 30, 2020, in accordance with the relevant auditing standards[123] - The company adopted the principles of the corporate governance code as per the listing rules and complied with all applicable provisions during the reporting period[124] - The board of directors confirmed compliance with the standard code of conduct for securities transactions during the six months ended June 30, 2020[124] - The company expressed gratitude to customers, suppliers, and shareholders for their continued support during the reporting period[126]