Financial Performance - For the fiscal year ending December 31, 2024, the company reported total revenue of USD 119.402 million, a decrease of 10.5% compared to USD 131.628 million in the previous year[2] - The gross profit for the same period was USD 64.163 million, representing a gross margin of approximately 53.7%, down from USD 57.4% in the previous year[2] - Operating profit decreased significantly to USD 12.088 million, a decline of 42.5% from USD 20.985 million in the prior year[2] - The net profit attributable to shareholders was USD 16.875 million, down 24.5% from USD 22.368 million in the previous year[2] - Basic and diluted earnings per share for the year were both USD 1.43, compared to USD 1.96 in the previous year, reflecting a decrease of 27%[2] - The company reported a total comprehensive income of USD 16.895 million, down from USD 22.374 million in the previous year[3] - The global revenue for the year ending 2024 was HKD 930.1 million, a decrease of 16% compared to HKD 1,109 million in 2023[28] - The gross profit margin for toy sales decreased to 54% in 2024 from 57% in 2023, attributed to higher retailer discounts and a shift towards lower-margin products[28] - The group recorded an operating profit of HKD 94 million in 2024, a decrease from HKD 210 million in 2023[29] - Shareholders' net profit for 2024 was HKD 132 million, down from HKD 224 million in 2023[29] - The company reported a basic earnings per share of HKD 111.3 million for 2024, down from HKD 223.7 million in 2023[23] Assets and Liabilities - Total assets as of December 31, 2024, were USD 177.154 million, a decrease from USD 191.189 million in the previous year[5] - Current liabilities decreased to USD 28.302 million from USD 39.521 million in the previous year, indicating improved liquidity[5] - Trade receivables at the end of 2024 totaled HKD 136.7 million, a significant decrease from HKD 328.8 million in 2023[24] - Trade receivables as of December 31, 2024, were HKD 136.67 million, a significant decrease from HKD 328.83 million in 2023[34] - Inventory at the end of 2024 was HKD 27.65 million, representing 3.0% of revenue, down from 5.3% in 2023[34] - The current ratio as of December 31, 2024, was 6.3, compared to 3.8 in 2023[34] - Cash and bank deposits amounted to HKD 1,043.33 million as of December 31, 2024, up from HKD 1,002.82 million in 2023[34] - The company’s cash and bank deposits increased to USD 133.760 million, up from USD 128.820 million in the previous year, showing a positive cash flow trend[5] - The group’s treasury investments in listed securities were HKD 87.47 million, an increase from HKD 68.57 million in 2023, accounting for 6.1% of total assets[35] Operating Expenses and Costs - Operating expenses decreased by 9% year-over-year, reflecting a reduction in variable costs, although some costs were offset by increased marketing expenses[28] - The cost of goods sold was HKD 391.5 million in 2024, down from HKD 437.7 million in 2023[16] Market and Customer Insights - The largest market for the company in 2024 was the United States, accounting for 70% of total revenue, followed by Europe at 20% and other regions in the Americas at 6%[28] - Revenue from major customers included approximately HKD 283.0 million and HKD 215.7 million, representing over 10% of total revenue[13] Future Plans and Product Development - The company plans to launch new products in 2025, which will increase product development costs as a percentage of sales[28] - The new "Power Rangers" product line is set to launch in summer 2025, expected to support business in the second half of the year[30] - The company signed a global licensing agreement with Hasbro for "Power Rangers" toys, with new content to be released on YouTube and Netflix[33] Dividends and Other Income - Other income net amounted to HKD 87.8 million in 2024, up from HKD 55.1 million in 2023, driven by increased interest income and unrealized gains[15] - The company announced a second interim dividend of HKD 0.03 per share and a special interim dividend of HKD 0.03 per share[40]

Financial Performance - For the six months ended June 30, 2024, the company's global revenue was HKD 445,141,000, representing a 28% increase from HKD 347,231,000 in the same period of 2023[6] - Gross profit for the same period was HKD 249,447,000, up from HKD 187,415,000, with a gross margin of 56%, compared to 54% in 2023[7] - Operating profit increased to HKD 68,435,000 from HKD 56,227,000, while net profit attributable to shareholders was HKD 91,458,000, compared to HKD 86,970,000 in the previous year[6] - The company reported a net profit before tax of HKD 91,458,000 for the six months ended June 30, 2024, compared to HKD 86,970,000 in 2023, reflecting an increase of approximately 5%[29] - The cost of goods sold for the period was HKD 184,619,000, up from HKD 147,480,000 in 2023, which is an increase of about 25%[23] Revenue Sources - Revenue from the Americas, particularly the United States, was HKD 309,454,000, up from HKD 209,899,000 in the previous year, indicating a growth of about 47%[20] - The company has two major customers contributing over 10% of total revenue, with sales to these customers amounting to approximately HKD 157,994,000 and HKD 102,552,000 respectively[21] Expenses and Costs - Operating expenses increased by 47% year-on-year, reflecting higher promotional and distribution costs in the U.S. market[7] - The company’s research and development expenses for the period were HKD 10,638,000, slightly down from HKD 11,656,000 in 2023[23] Cash Flow and Liquidity - The company reported an operating cash flow of $20,446,000 for the six months ended June 30, 2024, compared to a cash outflow of $11,669,000 in the previous year[14] - Cash and cash equivalents increased by $9,422,000 during the period, resulting in a total of $59,089,000 as of June 30, 2024, compared to $908,263,000 in the previous year[14] - The company’s cash and bank deposits totaled $139,361,000, compared to $1,002,820,000 at the end of the previous year[12] - The company reported cash and bank deposits that are approximately equal to their carrying values, indicating stable liquidity management[40] Assets and Liabilities - Total assets less current liabilities amounted to $152,902,000 as of June 30, 2024, showing an increase from $1,176,589,000 as of December 31, 2023[12] - The company’s net asset value was reported at $151,863,000, up from $1,163,917,000 at the end of the previous year[12] - The company’s inventory decreased to $6,658,000 from $58,886,000 in the previous year[12] - Trade receivables were reported at $17,174,000, a significant decrease from $328,827,000 in the previous year[12] - The total financial liabilities as of June 30, 2024, amounted to HKD 133,429,000, down 24.8% from HKD 177,503,000 as of December 31, 2023[36] Dividends and Shareholder Information - The company maintained an interim dividend of HKD 2.00 per share, consistent with the previous year[6] - The company declared an interim dividend of HKD 0.02 per share, consistent with the previous year, totaling HKD 23,614,000[26] - The company’s issued and fully paid ordinary shares remained at 1,180,700,000 shares as of June 30, 2024, unchanged from the previous reporting period[37] - The largest shareholder, Chen Junhao, holds 626,000,000 ordinary shares, accounting for 53.02% of the company's issued shares[56] Future Outlook - The company anticipates continued challenges in the second half of 2024 due to inflation affecting household spending, but expects support from the upcoming "Tales of The Teenage Mutant Ninja Turtles" series[8] - The "Godzilla x Kong" product line is expected to contribute positively following the successful release of the film in spring 2024[9] - The company remains optimistic about the long-term prospects of the "Teenage Mutant Ninja Turtles" brand and upcoming new brands in development for 2025 and 2026[8] Corporate Governance - The company has adopted the corporate governance code and complied with all applicable code provisions, except for the separation of roles between the chairman and CEO, as no CEO has been appointed[60] - The audit committee reviewed the accounting standards and practices used by the group, discussing internal controls and financial reporting matters for the six months ending June 30, 2024[61] - All directors confirmed compliance with the standard code of conduct regarding securities transactions during the period ending June 30, 2024[62] Share Options and Incentive Plans - The group has a maximum limit of 118,000,000 shares for the share incentive plan, which is 10% of the total shares issued as of the adoption date[49] - No share rewards have been granted under the share incentive plan since its adoption on May 19, 2023[50] - The company has granted 10,000,000 share options that are exercisable until December 31, 2023, and another 10,000,000 share options exercisable until December 31, 2023[52] - The 2018 Color Star Toys Plan was terminated on May 19, 2023, and no further share options will be granted under this plan[52] Market and Investment - The investment portfolio includes significant holdings in major companies such as NVIDIA, Amazon, and Apple, with the top ten listed securities accounting for 5.1% of total assets[46] - The group maintains a healthy level of cash for ongoing operations and future growth[46]

Revenue and Profit Growth - Global revenue for the first half of 2024 increased by 28% to HKD 445.1 million compared to HKD 347.2 million in the same period last year[2] - Total revenue for the six months ended June 30, 2024, was HKD 445,141,000, compared to HKD 347,231,000 in the same period of 2023, representing a 28.2% increase[14] - Operating profit for the first half of 2024 was HKD 68.4 million, up from HKD 56.2 million in the same period last year[3] - Net profit attributable to shareholders for the first half of 2024 was HKD 91.5 million, compared to HKD 87.0 million in 2023[3] - The company's profit before tax for the six months ended June 30, 2024, was HKD 184,619,000, compared to HKD 147,480,000 in the same period of 2023, representing a 25.2% increase[17] - Basic earnings per share for 2024 is HKD 0.0775, based on a profit attributable to owners of HKD 91,458,000 and a weighted average of 1,180,700,000 shares[22] Gross Profit Margin and Cost Efficiency - Gross profit margin for toy sales improved to 56% in 2024 from 54% in 2023, driven by higher sales in the US market, reduced inventory discounts, and lower product development costs[2] Financial Position and Assets - The company's cash and bank deposits increased to HKD 1,087,012,000 as of June 30, 2024, up from HKD 1,002,820,000 at the end of 2023, reflecting a growth of 8.4%[8] - The company's net current assets stood at HKD 1,135,314,000 as of June 30, 2024, compared to HKD 1,107,668,000 at the end of 2023, showing a 2.5% increase[8] - The company's total assets less current liabilities increased to HKD 1,192,637,000 as of June 30, 2024, from HKD 1,176,589,000 at the end of 2023, a growth of 1.4%[8] - The company's net equity increased to HKD 1,184,533,000 as of June 30, 2024, from HKD 1,163,917,000 at the end of 2023, reflecting a 1.8% increase[8] - The company's income from financial assets at fair value through profit or loss was HKD 50,822,000 for the six months ended June 30, 2024, compared to HKD 31,847,000 in the same period of 2023, a 59.6% increase[16] - Listed securities investments as of June 30, 2024, are HKD 78,507,000, representing 5.3% of total assets[26] - The company holds major listed securities including NVIDIA, Amazon, Disney, Alphabet, Apple, Microsoft, Netflix, Walmart, Tencent, and Alibaba[26] Tax and Financial Liabilities - The company's tax expense for the six months ended June 30, 2024, was HKD 25,962,000, compared to a tax credit of HKD 542,000 in the same period of 2023[19] - The company's cumulative unrecognized tax losses as of June 30, 2024, were HKD 4,368,000, down from HKD 6,869,000 at the end of 2023[19] - Trade receivables as of June 30, 2024, are HKD 133,954,000, with a customer discount provision of HKD 29,785,000[23] - Trade payables as of June 30, 2024, are HKD 58,512,000, with the majority due within 30 days[24] Dividend and Shareholder Information - Interim dividend per share is 2 HK cents, totaling HKD 23,614,000 for 2024, same as 2023[20] - Final dividend for the previous fiscal year includes a second interim dividend of 3 HK cents and a special interim dividend of 3 HK cents, totaling HKD 70,842,000 for 2024[21] - The company will suspend share registration from September 9, 2024, to September 10, 2024, inclusive[31] - Shareholders must submit transfer documents and related shares by 4:30 PM on September 6, 2024, to qualify for the declared dividend[31] - The interim dividend will be paid on September 27, 2024, to shareholders listed in the register as of September 10, 2024[31] Product Development and Licensing - The company is developing new products for the "Teenage Mutant Ninja Turtles" franchise, with a sequel movie and a two-season series in production[4] - The "Godzilla x Kong" franchise is expanding its product line, including highly detailed action figures and role-playing accessories[5] - The company has signed a global licensing agreement with Hasbro to produce and distribute "Power Rangers" toys, with a product line planned for release in fall 2025[6] Market and Economic Outlook - The company expects continued challenges in the second half of 2024 due to inflation and tighter household budgets, but anticipates support from the "Tales of The Teenage Mutant Ninja Turtles" series on Paramount+[3] - The "Godzilla x Kong" product line is expected to continue contributing positively, following the successful release of the "Godzilla x Kong: The New Empire" movie[3] Regional Revenue Performance - The company's revenue from the Americas region was HKD 309,454,000 for the six months ended June 30, 2024, compared to HKD 209,899,000 in the same period of 2023, a 47.4% increase[14] Liquidity and Currency Risk - The liquidity ratio as of June 30, 2024, is 5.1, compared to 3.8 as of December 31, 2023[26] - The company does not hedge its foreign currency risk due to the narrow range of exchange rate fluctuations between HKD and USD[27] Board of Directors - The board of directors includes Chairman Mr. Chan Kwong Fai, Executive Directors Ms. Chan Hoi Lun and Mr. Chan Kwong Keung, and Independent Non-Executive Directors Mr. Yip Shu Wing, Mr. Lam Wai Hon, and Mr. Yu Hon To[31]

Financial Performance - For the fiscal year 2023, Playmates Toys reported a global revenue of HKD 1.109 billion, a 120% increase compared to HKD 540 million in 2022[9]. - The operating profit for 2023 was HKD 210 million, a significant increase from HKD 34.5 million in 2022[10]. - The gross profit margin improved to 57% in 2023, up from 47% in 2022, attributed to a favorable product mix and reduced shipping costs[9]. - The company recorded net profit attributable to shareholders of HKD 224 million in 2023, compared to HKD 9.7 million in 2022[10]. - Operating expenses increased by 122% year-over-year, reflecting variable costs associated with the rise in revenue[9]. - The company declared an interim dividend of HKD 0.02 per share, totaling HKD 23,614,000, and a second interim dividend of HKD 0.03 per share, totaling HKD 70,842,000[44]. - The company's distributive reserves as of December 31, 2023, were HKD 390,340,000, an increase from HKD 310,735,000 in 2022[47]. Market and Product Development - The United States remained the largest market, accounting for 69% of total revenue, while Europe contributed 20% and other regions 11%[9]. - The company anticipates challenges in 2024 due to year-over-year comparisons but expects support from upcoming releases, including the "Tales of The Teenage Mutant Ninja Turtles" series on Paramount+[6]. - The "Godzilla x Kong" product line is expected to benefit from the release of "Godzilla x Kong: The New Empire" in March 2024, with initial retail responses being positive[10]. - Playmates Toys is actively developing new products to align with the upcoming content from Paramount, including sequels and spin-offs related to the "Teenage Mutant Ninja Turtles" franchise[12]. - The brand "Miraculous: Tales of Ladybug & Cat Noir" will continue to drive sales with new content set to premiere on Disney Channel and Disney+ in fall 2024[15]. Risks and Compliance - The company faces economic and political risks that may impact its strategic execution capabilities[30]. - The toy industry is inherently unpredictable, and reliance on third-party licenses and major customers poses business risks[30]. - Compliance risks related to product safety and legal regulations are critical, with established processes to ensure adherence[30]. - The company emphasizes the importance of product safety as a top priority in its operations[30]. Corporate Governance - The company has a diverse board of directors with extensive experience in various industries[21][22][25]. - The audit committee consists of three independent non-executive directors, ensuring effective oversight of financial reporting and risk management[94]. - The company is committed to high standards of corporate governance, having adopted the relevant codes and principles as of December 31, 2023[98]. - The board has mechanisms in place to ensure independent opinions are obtained, with three out of seven directors being independent non-executive directors[105]. - The company has implemented various policies to ensure its values are communicated to all employees, including a code of conduct and anti-corruption policies[99]. Employee and Workforce Management - The group has 62 employees in Hong Kong and the United States as of December 31, 2023, an increase from 60 employees in 2022[54]. - The overall employee turnover rate for 2023 was 11.29%[197]. - The turnover rate for male employees was 10.00%, while for female employees it was 12.50%[197]. - The company has implemented strict measures to protect confidential information and ensure data security[185]. - The company provides 30 hours of anti-corruption training for directors and employees in the Hong Kong office[182]. Environmental, Social, and Governance (ESG) - The environmental, social, and governance (ESG) report outlines the company's performance and measures in these areas for the year 2023[151]. - The company has established a corporate social responsibility (CSR) policy focusing on four pillars: business, employees, community, and environment[158]. - The company has identified several ESG risks, including climate physical risks and supply chain disruptions, and has implemented mitigation measures[162]. - The top five prioritized ESG issues include: air emissions, greenhouse gas emissions, decarbonization, ecosystem protection, and natural risk management[171]. - The company emphasizes continuous communication with stakeholders to understand their concerns regarding ESG matters[163].

Financial Performance - The group reported a net profit of HKD 223,745,000 for the year ended December 31, 2023, compared to HKD 9,722,000 in 2022, indicating a significant increase in profitability[4] - The group reported a total comprehensive income of HKD 55,068,000 for the year, compared to a loss of HKD 17,257,000 in 2022, marking a turnaround in overall financial performance[3] - The company reported a net profit attributable to shareholders of HKD 28,685,000 for 2023, compared to HKD 9,722,000 in 2022, representing a 195% increase[33] - The total comprehensive income attributable to shareholders for 2023 was HKD 223,700,000, compared to HKD 15,163,000 in 2022[34] - The company’s net profit attributable to shareholders for 2023 was HKD 224 million, a significant increase from HKD 9.7 million in 2022[67] Revenue Growth - The confirmed revenue from toy sales for the year ended December 31, 2023, was HKD 1,109,399,000, compared to HKD 504,248,000 in 2022, representing a 119% increase[41] - Revenue from the Americas, particularly the U.S., was HKD 765,727,000 in 2023, significantly up from HKD 303,101,000 in 2022, marking a 153% increase[42] - The global revenue for the fiscal year ending 2023 was HKD 1.109 billion, a 120% increase from HKD 540 million in 2022, driven by the successful re-launch of the "Teenage Mutant Ninja Turtles" toy series[83] Expenses and Costs - The cost of goods sold for 2023 was HKD 437,726,000, up from HKD 243,563,000 in 2022, indicating an increase of 80%[25] - Research and development expenses rose to HKD 30,803,000 in 2023 from HKD 18,348,000 in 2022, reflecting a 68% increase[25] - The company experienced a 122% increase in operating expenses year-over-year, reflecting rising variable costs in line with revenue growth[50] Liquidity and Financial Ratios - The current ratio decreased to 3.8 as of December 31, 2023, down from 6.6 in the previous year, indicating a decline in short-term liquidity[7] - Cash and bank deposits stood at HKD 1,002.82 million as of December 31, 2023, compared to HKD 927.92 million in 2022, indicating a strong liquidity position[72] - The group’s total assets less current liabilities amounted to HKD 1,176,589,000, compared to HKD 1,006,969,000 in 2022, showing an increase in net asset value[15] Shareholder Returns - The company declared an interim dividend of HKD 0.03 per share for the second half of the year, totaling HKD 35.42 million, alongside a special interim dividend of HKD 35.42 million[61] - The board declared an interim dividend of HKD 0.02 per share, paid on September 29, 2023[82] - A second interim dividend of HKD 0.03 per share and a special interim dividend of HKD 0.03 per share will be paid on April 24, 2024, to shareholders listed on April 9, 2024[85] Market and Product Development - The successful release of the animated film "Teenage Mutant Ninja Turtles: Mutant Mayhem" significantly boosted toy sales for the year 2023[5] - The company plans to leverage the success of the "Teenage Mutant Ninja Turtles: Mutant Mayhem" movie with a new animated series on Paramount+ in 2024[32] - The company plans to leverage the upcoming release of "Godzilla x Kong: New Empire" to boost toy sales in 2024[69] - The company is actively developing new products to align with the release of the "Teenage Mutant Ninja Turtles" sequel and the related series on Paramount+[79] Corporate Governance and Compliance - The company maintained a strong focus on corporate governance to protect shareholder interests and enhance overall performance[57] - The board structure is designed to ensure effective management and oversight of the company's operations and financial performance, with regular reviews to maintain robust corporate governance[75] - The group plans to adopt new and revised Hong Kong Financial Reporting Standards effective from January 1, 2023, which may impact future financial reporting[17] - The group has made changes to its accounting policy regarding long service payment liabilities in response to new guidelines issued by the Hong Kong Institute of Certified Public Accountants[21] Risk Management - The company does not hedge its foreign currency risk due to the narrow exchange rate control between the Hong Kong dollar and the US dollar, which may impact overall profitability[73] - Trade receivables are analyzed based on invoice date aging, with credit terms typically ranging from 60 to 90 days[78] - The company’s customer base includes two customers whose transactions accounted for over 10% of total revenue, generating approximately HKD 292,271,000 and HKD 262,184,000 in sales[42] Other Financial Metrics - The weighted average number of ordinary shares issued during the year was 1,180,265,000, slightly up from 1,180,000,000 in 2022[4] - The group’s non-current liabilities include lease liabilities of HKD 1,458,000 as of December 31, 2023, compared to HKD 20,165,000 in the previous year, indicating a reduction in long-term obligations[15] - Trade receivables as of December 31, 2023, amounted to HKD 328.83 million, significantly up from HKD 60.96 million in 2022, reflecting increased shipment volumes and customer orders[54] - The gross profit margin for toy sales increased to 57% in 2023 from 47% in 2022, attributed to a better product mix and reduced shipping costs[50] - The company recorded an operating profit of HKD 210 million in 2023, compared to HKD 34.5 million in 2022[67] - The operating profit for 2023 was HKD 26,904,000, down from HKD 34,532,000 in 2022, showing a decrease of 22%[33]

Financial Performance - For the six months ended June 30, 2023, the company reported a basic profit attributable to shareholders of HKD 86,970,000, compared to a loss of HKD 1,412,000 for the same period in 2022[1]. - Revenue for the six months ended June 30, 2023, was HKD 347,231,000, an increase of 30% compared to HKD 267,462,000 for the same period in 2022[38]. - Gross profit for the same period was HKD 187,415,000, reflecting a gross margin of 54%, up from 49% in the previous year[38]. - Operating profit increased significantly to HKD 56,227,000 from HKD 18,746,000 year-on-year[38]. - Basic and diluted earnings per share for the period were HKD 7.37, a recovery from a loss of HKD 0.12 in the same period last year[38]. - The company reported a profit attributable to owners of HKD 86,970,000, compared to a loss of HKD 1,412,000 in the prior year[38]. - The company recorded unrealized gains of HKD 13.9 million from listed securities investments for the first half of 2023, compared to unrealized losses of HKD 26.2 million in the same period of 2022[52]. - The company reported a tax expense of HKD 8,706,000 for the six months ended June 30, 2023, compared to HKD 3,425,000 in the same period of 2022[99]. Dividends - The company's mid-term dividend per share remained unchanged at HKD 0.02, totaling HKD 23,600,000 for both 2023 and 2022[1]. - The company declared an interim dividend of HKD 2.00 per share, compared to no dividend in the previous year[38]. - The company will pay an interim dividend on September 29, 2023, to shareholders listed on September 12, 2023[159]. Assets and Liabilities - Trade receivables increased significantly to HKD 172,991,000 as of June 30, 2023, from HKD 60,962,000 as of December 31, 2022, indicating improved customer order and delivery conditions[21]. - The company's current ratio decreased to 4.8 as of June 30, 2023, down from 6.6 as of December 31, 2022, reflecting a change in liquidity position[21]. - The company reported a total asset value of HKD 1,261,124,000 as of June 30, 2023, compared to HKD 1,116,623,000 as of December 31, 2022[83]. - The company's total liabilities included contract liabilities of HKD 7,243,000 and accrued expenses of HKD 122,925,000 as of June 30, 2023[13]. - The company's total liabilities decreased to HKD 261,006,000 as of June 30, 2023, from HKD 170,372,000 as of December 31, 2022[1]. - The cumulative unrecognized tax losses amounted to HKD 9,335,000 as of June 30, 2023, down from HKD 92,210,000 as of December 31, 2022[79]. Cash Flow - The company’s operating cash flow for the six months ended June 30, 2023, was a net outflow of HKD 11,669,000, compared to an inflow of HKD 63,783,000 in the same period last year[45]. - As of June 30, 2023, the company's cash and bank balances amounted to HKD 908,263,000, a decrease from HKD 927,922,000 as of December 31, 2022[83]. Market and Product Development - The company plans to continue marketing efforts for the "Teenage Mutant Ninja Turtles" toy series following the successful release of the animated film in August 2023[40]. - The "Miraculous: Tales of Ladybug & Cat Noir" movie launched on Netflix in summer 2023, with expectations to drive further toy sales in the second half of the year[41]. - The company expects strong sales for the re-launched "Teenage Mutant Ninja Turtles" toy series following the successful release of the animated film "Teenage Mutant Ninja Turtles: Mutant Mayhem" in summer 2023[62]. - The animated series "Miraculous: Tales of Ladybug & Cat Noir" continues to be popular, airing in over 120 countries and on multiple digital platforms[64]. - The company is actively developing new products to align with the upcoming sequel to "Teenage Mutant Ninja Turtles: Mutant Mayhem" and a new animated series on Paramount+[63]. Employee and Governance - The company has 62 employees in Hong Kong and the United States as of June 30, 2023[86]. - The company has adopted the corporate governance code and complied with all applicable code provisions, with further details to be included in the annual report[156]. - The company has not appointed a CEO, and the board oversees management, business strategies, and financial performance[169]. - The company’s board structure will be regularly reviewed to ensure robust corporate governance[169]. - The company’s independent non-executive director, Zhou Yujun, resigned on May 19, 2023[148]. Shareholder Information - The company has a maximum limit of 118,000,000 shares for its share incentive plan, representing 10% of the total issued shares at the time of adoption[88]. - The company’s directors hold a total of 104,000,000 shares, representing 5.02% of the total shares[127]. - The company’s major shareholder, Chen Junhao, holds 626,000,000 ordinary shares, representing 53.05% of the total shares[152]. - Color Star Group holds 600,000,000 ordinary shares, accounting for 50.85% of the total shares[152]. - The company has not granted, exercised, or canceled any stock options during the reporting period[123]. - The company has a total of 118,000,000 shares available for reward under the share incentive plan[130]. - The company has 41,116,000 shares available for issuance under the 2018 Color Star Toys Plan, with an initial grant of 57,784,000 options[149]. - The company has no plans to issue further options under the 2018 Color Star Toys Plan following its termination on May 19, 2023[149]. - The company did not repurchase any shares during the reporting period[155].

[Performance Highlights](index=1&type=section&id=Performance%20Highlights) The company achieved significant revenue growth and a turnaround to net profit for the six months ended June 30, 2023 Financial Summary for the Six Months Ended June 30, 2023 | Metric | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | Revenue | HKD 347,231 Thousand | HKD 267,462 Thousand | | Gross Profit | HKD 187,415 Thousand | HKD 130,563 Thousand | | Operating Profit | HKD 56,227 Thousand | HKD 18,746 Thousand | | Profit/(Loss) Attributable to Owners of the Company | HKD 86,970 Thousand | HKD (1,412) Thousand | | Basic Earnings/(Loss) Per Share | 7.37 HK cents | (0.12) HK cents | | Interim Dividend Per Share | 2.00 HK cents | - | [Management Discussion and Analysis](index=1&type=section&id=Management%20Discussion%20and%20Analysis) This section details the company's strong financial performance and strategic brand initiatives during the reporting period [Operating Results](index=1&type=section&id=Operating%20Results) The company achieved strong performance in the first half of 2023, with significant revenue growth and a turnaround from net loss to net profit Key Performance Indicators for H1 2023 | Metric | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Global Turnover | HKD 347 Million | HKD 267 Million | | Net Profit/(Loss) Attributable to Shareholders | Net Profit HKD 87.0 Million | Net Loss HKD 1.4 Million | | Operating Profit | HKD 56.2 Million | HKD 18.7 Million | - Toy sales gross margin improved from **49%** to **54%**, primarily due to a favorable product mix, lower shipping costs, and reduced inventory write-down provisions[17](index=17&type=chunk) - Other net income included **HKD 13.9 million** in unrealized gains and **HKD 2.1 million** in realized gains from listed securities investments, compared to an unrealized investment loss of **HKD 26.2 million** in the prior period[42](index=42&type=chunk) [Brand Overview](index=2&type=section&id=Brand%20Overview) The company maintains an optimistic outlook for the second half, driven by strong performance of core IPs like Teenage Mutant Ninja Turtles and Miraculous Ladybug & Cat Noir - The core IP, Teenage Mutant Ninja Turtles, was revitalized by the success of the animated film 'Teenage Mutant Ninja Turtles: Mutant Mayhem', leading to strong toy sales in key global markets, with continued marketing planned for the fall[18](index=18&type=chunk)[19](index=19&type=chunk) - The company is actively developing new products for the Teenage Mutant Ninja Turtles IP's subsequent content, including a movie sequel and two seasons of a series to be aired on Paramount+[13](index=13&type=chunk) - Another core IP, 'Miraculous: Tales of Ladybug & Cat Noir' TV series continues to be popular globally, and its feature film's Netflix premiere received enthusiastic response, expected to drive toy sales in the second half[14](index=14&type=chunk)[18](index=18&type=chunk)[20](index=20&type=chunk) [Condensed Consolidated Financial Statements](index=3&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated financial statements, including income, comprehensive income, and financial position [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2023, the company reported a 30% revenue increase to HKD 347 million and a significant turnaround to a net profit of HKD 87 million Condensed Consolidated Statement of Profit or Loss (Six Months Ended June 30) | Item | 2023 (HKD Thousand) | 2022 (HKD Thousand) | | :--- | :--- | :--- | | Revenue | 347,231 | 267,462 | | Gross Profit | 187,415 | 130,563 | | Operating Profit | 56,227 | 18,746 | | Profit/(Loss) before income tax | 86,428 | (7,326) | | Profit/(Loss) Attributable to Owners of the Company | 86,970 | (1,412) | | Basic Earnings/(Loss) Per Share | 7.37 HK cents | (0.12) HK cents | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2023, the company's total assets increased to HKD 1.327 billion and net assets to HKD 1.05 billion, maintaining a robust financial position with ample cash and bank balances Condensed Consolidated Statement of Financial Position Summary | Item | June 30, 2023 (HKD Thousand) | Dec 31, 2022 (HKD Thousand) | | :--- | :--- | :--- | | **ASSETS** | | | | Non-current assets | 65,863 | 60,718 | | Current assets | 1,261,124 | 1,116,623 | | Of which: Inventories | 61,735 | 23,700 | | Of which: Trade receivables | 172,991 | 60,962 | | Of which: Cash and bank balances | 908,263 | 927,922 | | **LIABILITIES AND EQUITY** | | | | Current liabilities | 261,006 | 170,372 | | Non-current liabilities | 15,807 | 20,165 | | **Net assets** | **1,050,174** | **986,804** | [Notes to the Condensed Consolidated Financial Information](index=5&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Information) This section provides detailed notes on the preparation basis, accounting policies, and specific financial items within the consolidated financial information [Basis of Preparation and Accounting Policies](index=5&type=section&id=Basis%20of%20Preparation%20and%20Accounting%20Policies) The interim condensed consolidated financial information is prepared in accordance with HKAS 34, with consistent accounting policies and no significant impact from new accounting standards - The financial information is prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' and the disclosure provisions of the Listing Rules[23](index=23&type=chunk) - The accounting policies adopted are consistent with those used in the 2022 annual financial statements, and new standards and amendments effective during the period had no significant impact[24](index=24&type=chunk)[25](index=25&type=chunk) [Revenue and Segment Information](index=5&type=section&id=Revenue%20and%20Segment%20Information) The group operates solely in the design, R&D, marketing, and distribution of toys and home entertainment products, with Americas as the largest revenue source and a concentration of three major clients Revenue by Region (Six Months Ended June 30) | Region | 2023 (HKD Thousand) | 2022 (HKD Thousand) | | :--- | :--- | :--- | | Americas | 240,933 | 182,144 | | Europe | 80,492 | 67,786 | | Other Asia Pacific excluding Hong Kong | 25,000 | 16,137 | | Other | 806 | 1,313 | | **Total** | **347,231** | **267,380** | - The group has only one operating segment: the design, research and development, marketing, and distribution of toys and home entertainment products[25](index=25&type=chunk) - The group's customer base includes three clients whose transactions accounted for over **10%** of total revenue, with revenues of approximately **HKD 63.01 million**, **HKD 51.73 million**, and **HKD 46.49 million** respectively[51](index=51&type=chunk) [Other Income/(Loss), Net](index=6&type=section&id=Other%20Income%2F%28Loss%29%2C%20Net) The period recorded other net income of HKD 31.85 million, a significant turnaround from a net loss of HKD 24.84 million in the prior period, driven by fair value changes in financial assets and increased interest income Other Income/(Loss), Net Details (Six Months Ended June 30) | Item | 2023 (HKD Thousand) | 2022 (HKD Thousand) | | :--- | :--- | :--- | | Net gain/(loss) on financial assets (unrealized) | 13,875 | (26,173) | | Net gain/(loss) on financial assets (realized) | 2,063 | - | | Interest income | 15,692 | 621 | | **Total** | **31,847** | **(24,835)** | [Income Tax](index=7&type=section&id=Income%20Tax) The period recorded an income tax credit of HKD 0.542 million, primarily from deferred tax movements, with accumulated unrecognized tax losses of HKD 9.335 million remaining at period-end Income Tax Credit Composition (Six Months Ended June 30) | Item | 2023 (HKD Thousand) | 2022 (HKD Thousand) | | :--- | :--- | :--- | | Current tax expense | 8,706 | 3,425 | | Deferred tax credit | (9,248) | (9,339) | | **Total income tax credit** | **(542)** | **(5,914)** | - As of June 30, 2023, the group's accumulated unrecognized tax losses amounted to **HKD 9.335 million**, with no expiry date for these tax losses[54](index=54&type=chunk) [Dividends](index=8&type=section&id=Dividends) The Board resolved to declare an interim dividend of 2 HK cents per share for the six months ended June 30, 2023, payable on September 29, 2023 - The Board resolved to pay an interim dividend of **2 HK cents** per share, totaling approximately **HKD 23.614 million**, with no dividend paid in the prior period[31](index=31&type=chunk)[55](index=55&type=chunk) [Earnings/(Loss) Per Share](index=8&type=section&id=Earnings%2F%28Loss%29%20Per%20Share) Basic earnings per share for the six months ended June 30, 2023, significantly improved to 7.37 HK cents, with diluted earnings per share being equal due to anti-dilutive potential ordinary shares Basic Earnings/(Loss) Per Share Calculation | Item | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Profit/(Loss) Attributable to Owners of the Company | HKD 86.970 Million | Loss HKD 1.412 Million | | Weighted average number of ordinary shares in issue | 1,180,000,000 shares | 1,180,000,000 shares | | **Basic Earnings/(Loss) Per Share** | **7.37 HK cents** | **(0.12) HK cents** | - Diluted earnings per share are equal to basic earnings per share due to the anti-dilutive effect of potential ordinary shares from the exercise of share options[1](index=1&type=chunk) [Trade and Other Receivables and Payables](index=9&type=section&id=Trade%20and%20Other%20Receivables%20and%20Payables) As of June 30, 2023, net trade receivables significantly increased to HKD 173 million, reflecting improved Q2 orders and shipments, with a healthy aging profile and a corresponding increase in trade payables Trade Receivables Aging Analysis | Aging | June 30, 2023 (HKD Thousand) | Dec 31, 2022 (HKD Thousand) | | :--- | :--- | :--- | | 0-60 days | 158,849 | 38,537 | | 61-90 days | 14,065 | 19,606 | | Over 90 days | 77 | 2,819 | | **Total** | **172,991** | **60,962** | - Trade receivables and inventories were at higher levels at the interim period-end, reflecting improved customer orders and shipments in Q2 2023[68](index=68&type=chunk) [Financial Analysis](index=10&type=section&id=Financial%20Analysis) This section analyzes the company's liquidity, financial resources, treasury investments, and foreign exchange risk exposures [Liquidity and Financial Resources](index=10&type=section&id=Liquidity%20and%20Financial%20Resources) The group maintains ample liquidity with HKD 908.263 million in cash and bank balances and a healthy current ratio of 4.8, despite seasonal working capital demands Liquidity Indicators | Metric | June 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and bank balances | HKD 908.263 Million | HKD 927.922 Million | | Current Ratio | 4.8 | 6.6 | - The toy business is subject to seasonality, with additional working capital demands during the peak sales season in the second half, typically leading to a significant increase in trade receivables[68](index=68&type=chunk) [Treasury Investments](index=10&type=section&id=Treasury%20Investments) As of June 30, 2023, the group held treasury investments in listed securities totaling HKD 69.62 million, primarily diversified blue-chip stocks in overseas and Hong Kong markets - Total treasury investments amounted to **HKD 69.624 million**, with **HKD 56.966 million** in overseas listed securities and **HKD 12.658 million** in Hong Kong listed securities[37](index=37&type=chunk) - The top ten holdings include well-known companies such as The Walt Disney Company, Amazon.com, Inc., NVIDIA Corporation, Apple Inc., and Microsoft Corporation[37](index=37&type=chunk) [Foreign Exchange Risk](index=10&type=section&id=Foreign%20Exchange%20Risk) The group's primary foreign exchange risk stems from USD-denominated sales, which is mitigated by the HKD-USD peg, thus no hedging is undertaken - The primary foreign currency risk is from USD sales, but due to the HKD-USD linked exchange rate system, the group does not hedge its foreign currency risk[69](index=69&type=chunk) [Other Matters](index=10&type=section&id=Other%20Matters) This section covers corporate governance, share repurchase activities, and details regarding dividend payments and share transfers [Corporate Governance](index=10&type=section&id=Corporate%20Governance) During the reporting period, the company complied with the Corporate Governance Code, with the exception of the combined Chairman and CEO roles, and the Audit Committee reviewed the interim financial information - The company has complied with the Corporate Governance Code, except for the non-segregation of the roles of Chairman and Chief Executive Officer, as the company has no designated CEO[70](index=70&type=chunk) - The Audit Committee has reviewed accounting principles and practices with management and has reviewed the unaudited condensed consolidated financial information for the period[71](index=71&type=chunk) [Share Repurchase](index=10&type=section&id=Share%20Repurchase) Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's shares during the six months ended June 30, 2023 - The company did not redeem, purchase, or sell any of its shares during the period[5](index=5&type=chunk) [Dividend Payment and Share Transfer](index=11&type=section&id=Dividend%20Payment%20and%20Share%20Transfer) To qualify for the interim dividend, shareholders must submit transfer documents by September 8, 2023, with share transfer registration suspended from September 11-12, and dividend payment on September 29, 2023 - The company will suspend share transfer registration from September 11 to 12, 2023, and the interim dividend will be paid on September 29, 2023, to shareholders registered on September 12[7](index=7&type=chunk)

Shareholder Structure - The company has a significant shareholder, Chen Junhao, holding 626,000,000 shares, representing 53.05% of the total issued shares[6]. - The company also has a major shareholder, 彩星集團, which owns 600,000,000 shares, accounting for 50.85% of the total issued shares[6]. - As of December 31, 2022, the board members collectively hold a total of 104,000,000 shares, which is 5.02% of the total issued shares[2]. Lease Agreements - The company has entered into lease agreements for properties in Hong Kong and the UK, with total monthly rents of HKD 354,320 and HKD 27,380, and GBP 5,700 respectively[15]. - The estimated value of the right-of-use assets from the lease agreements is approximately HKD 14,500,000[16]. - The board believes that the lease agreements align with the company's business needs and provide administrative convenience[16]. Financial Performance - The company's performance in 2022 was below expectations due to economic uncertainties, cautious consumer behavior, and unfavorable currency exchange rates, leading to a decrease in sales from the previous year[24]. - The gross profit margin for toy sales decreased to 47% in 2022, down from 49% in 2021, attributed to increased product discounts and inventory write-downs to reduce stock levels[34]. - The overall toy sales volume in the largest market, the United States, declined by 4% compared to 2021, with sales revenue remaining relatively unchanged[31]. - The global revenue for Playmates Toys Limited for the year ended December 31, 2022, was HKD 540 million, a decrease of 19% compared to HKD 625 million in 2021[55]. - The operating profit for the period was HKD 34.5 million, down from HKD 37.8 million in 2021, with net profit attributable to shareholders at HKD 9.7 million, compared to HKD 43 million in the previous year[56]. Future Outlook - The company anticipates improved performance in 2023, driven by the upcoming release of the "Teenage Mutant Ninja Turtles: Mutant Mayhem" animated film and the re-launch of the "Ninja Turtles" toy line[27]. - The company is optimistic about the operating environment despite challenges and uncertainties, driven by major entertainment events[53]. - The company anticipates that the upcoming release of the "Miraculous Ladybug & Cat Noir" movie will generate renewed interest and attract new audiences[53]. Inventory and Receivables - The company has implemented decisive measures to reduce inventory levels, which resulted in additional costs and profit pressure[24]. - Inventory as of December 31, 2022, was HKD 23,700,000, representing 4.7% of revenue, compared to HKD 58,007,000 or 9.3% of revenue in 2021, reflecting a strategic reduction in inventory levels[76]. - The company reported accounts receivable of HKD 60,962,000 as of December 31, 2022, down from HKD 124,378,000 in 2021, indicating a significant reduction in outstanding receivables[76]. Corporate Governance - The audit committee consists of four independent non-executive directors, ensuring effective oversight of financial reporting and risk management[10]. - The company has not changed its auditor in the past three years, indicating stability in its financial oversight[11]. - The board consists of three executive directors and four independent non-executive directors, ensuring a balance of power and independence[139]. - The company has adopted the corporate governance code as per the Hong Kong Stock Exchange rules and has complied with all applicable code provisions, except for the separation of roles between the Chairman and CEO[145]. - The board is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance group performance[145]. Employee and Social Responsibility - The company encourages employee training and development to enhance skills and knowledge, ensuring fair compensation in line with industry standards[76]. - Charitable and other donations for the year amounted to HKD 2,950,000, significantly up from HKD 81,000 in 2021[97]. - The company maintains a gender ratio of 48:52 among employees as of December 31, 2022, and aims to continue this balance[200]. Risk Management - The company has established a risk management and internal control system to identify and mitigate current risks[87]. - The internal control system is based on the COSO framework, focusing on managing risks to achieve business objectives and ensuring compliance with applicable laws[186]. Dividend and Financial Reserves - As of December 31, 2022, the company's distributable reserves amounted to HKD 310,735,000, an increase from HKD 305,049,000 in 2021[93]. - The company declared an interim dividend of HKD 0.02 per share, totaling HKD 23,600,000 based on 1,180,000,000 shares issued as of March 10, 2023[92].

Financial Performance - The company's revenue for the first half of 2022 was HKD 267,462,000, representing a 25% increase compared to HKD 213,988,000 in the same period of 2021[13] - Gross profit for the first half of 2022 was HKD 130,563,000, with a gross margin of 49%, down from 52% in the previous year, attributed to increased shipping costs and inventory write-downs[14] - Operating profit for the first half of 2022 was HKD 18,746,000, compared to HKD 15,498,000 in the same period of 2021[14] - The company recorded a loss before tax of HKD 7,326,000, a decline from a profit of HKD 14,459,000 in the same period of 2021[20] - Net loss attributable to shareholders for the first half of 2022 was HKD 1,412,000, compared to a profit of HKD 14,483,000 in the same period of 2021[20] - Total revenue for the six months ended June 30, 2022, was HKD 267,380,000, an increase of 25.1% compared to HKD 213,639,000 for the same period in 2021[37] - Revenue from the Americas increased to HKD 182,144,000, up 33.1% from HKD 151,993,000 in the previous year[37] - The company reported a net loss before tax of HKD 24,835,000 for the six months ended June 30, 2022, compared to a profit of HKD 387,000 in the same period of 2021[40] - The cost of goods sold for the six months ended June 30, 2022, was HKD 125,949,000, representing an increase of 32.5% from HKD 94,968,000 in 2021[41] - Research and development expenses for the period were HKD 7,864,000, up 25.6% from HKD 6,264,000 in the previous year[41] Assets and Liabilities - As of June 30, 2022, the company's total assets less current liabilities amounted to $126,735,000, compared to $1,009,014,000 as of December 31, 2021, indicating a decrease of approximately 87.5%[22] - The company's non-current assets, including property, plant, and equipment, totaled $115,000,000 as of June 30, 2022, down from $1,119,000,000 as of December 31, 2021[22] - The total equity as of June 30, 2022, was $125,185,000, a decrease from $995,198,000 as of December 31, 2021, representing a decline of approximately 87.4%[24] - The company's current assets net value was $119,129,000 as of June 30, 2022, compared to $954,942,000 as of December 31, 2021, indicating a decrease of approximately 87.5%[22] - The company’s total liabilities decreased to HKD 152,163,000 as of June 30, 2022, from HKD 165,702,000 as of December 31, 2021[57] Cash Flow - The cash generated from operating activities for the six months ended June 30, 2022, was $8,230,000, a significant increase from $41,682,000 in the same period of the previous year[26] - The net cash increase for cash and cash equivalents was $2,355,000 for the six months ended June 30, 2022, compared to $35,861,000 in the prior year, reflecting a decrease of approximately 93.4%[26] - The company reported a net cash outflow from investing activities of $1,903,000 for the six months ended June 30, 2022, compared to a cash inflow of $528,000 in the same period of the previous year[26] Inventory and Receivables - The company's inventory increased to HKD 67,815,000 as of June 30, 2022, from HKD 58,007,000 as of December 31, 2021, representing an increase of about 16.5%[70] - Trade receivables as of June 30, 2022, were HKD 79,111,000, a decrease from HKD 141,091,000 as of December 31, 2021[53] - The company reported trade receivables of HKD 59,270,000 as of June 30, 2022, down from HKD 124,378,000 as of December 31, 2021, indicating a decrease of approximately 52.3%[70] Corporate Governance and Structure - The company has adopted the corporate governance code and complied with all applicable code provisions, except for the separation of the roles of Chairman and CEO[151] - The audit committee reviewed the accounting standards and practices used by the group, discussing internal controls and financial reporting matters[151] - The company has significant shareholders, with Chen Junhao holding 626,000,000 shares, representing 53.05% of the issued share capital[147] - TGC Assets Limited also holds 626,000,000 shares, equivalent to 53.05% of the company, due to its beneficial ownership by Chen Junhao[148] - The company has not disclosed any new product launches or technological advancements during the reporting period, suggesting a potential area for future focus[10] Market and Product Development - The company anticipates a challenging operating environment in the second half of 2022 due to high inflation and reduced consumer spending on non-essential items[16] - The "Miraculous: Tales of Ladybug & Cat Noir" toy series continues to expand, with plans for new product lines in 2023[17] - The company is the global licensee for "Star Trek" toys and plans to launch a collectible series in summer 2022, along with new action figures for "Star Trek: Prodigy" later in the year[18] - The company remains committed to delivering innovative toys and building a profitable long-term brand business[16] Employment and Compensation - The company employed 57 staff members in Hong Kong and the United States as of June 30, 2022, with no significant changes in compensation policy[74] Miscellaneous - The company’s main office is located in Hong Kong, with a registered office in Bermuda[157] - The company is listed on the Hong Kong Stock Exchange under stock code 869[158] - The company has engaged various banks, including Bank of East Asia and DBS Bank (Hong Kong) Limited, for its banking needs[158] - The company’s website is www.playmatestoys.com, providing further information about its operations[159]

Financial Performance - Playmates Toys reported a global revenue of HKD 625 million for the year ended December 31, 2021, representing a 116% increase compared to HKD 289 million in 2020[10]. - The gross profit margin for toy sales remained at 49%, consistent with the previous year, despite rising costs in finished goods and logistics[10]. - The company recorded an operating profit of HKD 37.8 million in 2021, compared to an operating loss of HKD 32.5 million in 2020[11]. - Net profit attributable to shareholders was HKD 43 million, a significant turnaround from a net loss of HKD 30.1 million in 2020[11]. - The U.S. market accounted for approximately 55% of total revenue, while Europe contributed about 31%[10]. - The company anticipates ongoing operational and cost challenges in 2022 due to the impact of the COVID-19 pandemic and global supply chain disruptions[11]. Product Development and Market Strategy - The company plans to expand the "Miraculous: Tales of Ladybug & Cat Noir" toy line, which is expected to be a major driver of performance in 2022[8]. - New product launches are planned for the "MonsterVerse" and Toho Classic Monsters, alongside a new series of collectibles based on "Star Trek: Prodigy"[8]. - The "Spy Ninjas" product line will continue to expand in 2022, leveraging the popularity of the YouTube series[17]. - The company has become the global licensee for all characters, vehicles, and ships from ViacomCBS's "Star Trek" franchise, with a collectible series set to launch in summer 2022[18]. - A new line of action figures based on the Paramount+ and Nickelodeon animated series "Star Trek: Prodigy" will be released in late 2022[18]. Operational Challenges and Risks - The company is heavily reliant on third-party licenses, with current revenue coming from several brands, indicating potential vulnerability to sales declines in those brands[33]. - The company faces economic and political risks that could impact its strategic execution capabilities[33]. - Compliance risks related to product safety and legal regulations are a priority, with established processes to ensure adherence to applicable laws[33]. - The company acknowledges that reliance on major customers could adversely affect its financial performance if purchasing patterns change[33]. - The largest supplier accounted for 22% of total purchases, while the top five suppliers combined represented 86%[46]. - The largest customer contributed 30% of total sales, with the top five customers together accounting for 75%[46]. Financial Position and Reserves - As of December 31, 2021, trade receivables amounted to HKD 124,378,000, a significant increase from HKD 41,291,000 in 2020[52]. - Inventory stood at HKD 58,007,000, representing 9.3% of revenue, compared to 3.6% in 2020[52]. - The current ratio was 4.8 as of December 31, 2021, down from 7.9 in the previous year[52]. - Cash and bank balances totaled HKD 893,997,000, a decrease from HKD 949,943,000 in 2020[52]. - The company declared an interim dividend of HKD 0.02 per share, totaling HKD 23,600,000 based on 1,180,000,000 shares issued[47]. - The distributable reserves as of December 31, 2021, were HKD 305,049,000, up from HKD 235,860,000 in 2020[51]. Corporate Governance and Management - The company has experienced significant management changes, with key executives having extensive backgrounds in finance and investment management[20][21][22][23][25][26][27]. - The company’s financial performance and future developments are discussed in the annual report, particularly in the "Chairman's Report" and "Management Discussion and Analysis" sections[32]. - The company has a focus on international market operations and product development, with over 25 years of experience in the toy industry among its executives[26]. - The company’s financial key performance indicators are analyzed in the annual report, providing insights into its operational effectiveness[32]. - The board of directors has undergone changes, with several appointments and resignations noted during the year[61]. Risk Management and Compliance - The company has implemented internal controls to protect critical data, including customer and financial information[36]. - The company maintains a strong focus on compliance with applicable laws and regulations, ensuring ongoing training for staff[44]. - The group has established a special bonus system and stock option plan for employees based on performance[56]. - The company has established an internal control system based on the globally recognized COSO framework, which includes five components to ensure effective risk management and compliance[135]. - The board of directors is responsible for overseeing the overall risk management framework, integrating it into daily business activities, including business planning and internal controls[136]. Environmental, Social, and Governance (ESG) Initiatives - The report covers the company's performance in environmental, social, and governance (ESG) aspects for the year 2021, aligning with previous reporting scopes[150]. - The report was prepared in accordance with the Hong Kong Stock Exchange's ESG reporting guidelines and has been reviewed and approved by the board[151]. - The company has established a corporate social responsibility policy focusing on four pillars: business, employees, community, and environment[158]. - An independent consultant was appointed to conduct a materiality assessment to identify significant environmental, social, and governance issues[167]. - The company identified 27 key environmental, social, and governance issues and prioritized them based on stakeholder feedback[167]. Employee and Workplace Safety - The total number of employees at the end of the reporting period was 54[191]. - Employee turnover rate for the overall workforce was 22.22%[197]. - Male employee turnover rate was 20.83%, while female employee turnover rate was 23.33%[197]. - Turnover rate in Hong Kong was 26.92%, compared to 17.86% in the United States[197]. - The company emphasizes the importance of a safe and healthy work environment for employees[198].