中期報 告 KNT HOLDINGS LIMITED Interim Report 2022 KNT KNT HOLDINGS LIMITED 嘉 藝 控 股有限公司 (Incorporated in the Cayman Islands with limited liability) Stock code: 1025 嘉藝控股有限公 司 Interim Report 2022 For identification purpose only KNT HOLDINGS LIMITED 股份代號：1025 （於開曼群島註冊成立的有限公司） 嘉藝控股有限公司 中期報告 2022 僅供識別 1 嘉藝控股有限公司 | 二零二二年中期報告 目錄 公司資料2 | --- | --- | |------------------------------|-------| | | | | 管理層討論及分析 | 3 | | 其他資料 | 15 | | 簡明綜合損益表 | 26 | | 簡明綜合損益及其他全面收益表 | 27 | | 簡明綜合財務狀況表 | 28 | | 簡明綜合權益變動表 | 31 | | 簡明綜合現金流量表 | ...

KNT HOLDINGS LIMITED 嘉 藝 控 股 有 限 公 司* 股份代號： 1025 (於開曼群島註冊成立的有限公司) 年 報 2022 * 僅供識別 目 錄 | --- | |--------------------------| | 目 錄 | | 公司資料 | | 主席報告 | | 管理層討論及分析 | | 董事及高級管理層履歷 | | 企業管治報告 | | 環境、社會及管治報告 | | 董事會報告 | | 獨立核數師報告 | | 綜合損益表 | | 綜合損益及其他全面收益表 | | 綜合財務狀況表 | | 綜合權益變動表 | | 綜合現金流量表 | | 綜合財務報表附註 | | 財務概要 | 2 3 5 12 16 31 57 73 78 79 80 82 83 85 148 1 二零二二年年報 • 嘉藝控股有限公司 公司資料 公司資料 | --- | --- | |-------------------------------------------------------------------------------------|--------------------------- ...

Revenue Performance - For the six months ended September 30, 2021, the company recorded revenue of approximately HKD 37,500,000, a decrease of about 8.8% compared to HKD 41,100,000 for the same period in 2020[7]. - Revenue from the United States accounted for approximately 50.1% of total revenue for the six months ended September 30, 2021, down from 79.6% in the same period of 2020[7]. - Revenue from special occasion garments decreased from approximately HKD 7,500,000 for the six months ended September 30, 2020, to approximately HKD 2,300,000 for the six months ended September 30, 2021, primarily due to a drop in sales volume from 40,600 units to 2,900 units[13]. - Revenue for the six months ended September 30, 2021, was HKD 37,532,000, a decrease of 8.5% from HKD 41,104,000 in 2020[84]. - The sales of bridesmaid dresses amounted to HKD 19,198,000, down 30.9% from HKD 27,834,000 in the previous year[106]. - Revenue from the United States was HKD 18,811,000, a decrease of 42.5% from HKD 32,682,000 in the previous year[107]. - Revenue from Hong Kong increased significantly to HKD 12,891,000 from HKD 1,487,000, marking a growth of 767.5%[107]. Profitability and Loss - The company reported a loss of approximately HKD 7,500,000 for the six months ended September 30, 2021, a reduction of about 54.5% compared to a loss of HKD 16,500,000 for the same period in 2020[7]. - The net loss for the period was HKD 7,537,000, significantly improved from a net loss of HKD 16,489,000 in the previous year[85]. - The loss for the six months ended September 30, 2021, was approximately HKD 7,500,000, with the reduction in loss primarily due to decreased administrative expenses and financing costs[22]. - For the six months ended September 30, 2021, the company reported a loss attributable to shareholders of HKD 7,537,000, compared to a loss of HKD 16,489,000 for the same period in 2020, representing a 54.3% improvement in loss[116]. Cost Management - Cost control measures have been implemented since April 2020 to cope with prolonged business downturns[10]. - Cost of sales reduced by approximately HKD 3,500,000 or about 9.5% from approximately HKD 37,000,000 for the six months ended September 30, 2020, to approximately HKD 33,500,000 for the six months ended September 30, 2021[14]. - Administrative expenses decreased by approximately HKD 1,400,000 or about 10.2% from approximately HKD 13,700,000 to approximately HKD 12,300,000, attributed to cost control measures[19]. - The company reported a financial cost of HKD 573,000, down from HKD 1,007,000, representing a decrease of 43.1%[84]. - The company's total financial costs decreased to HKD 573,000 from HKD 1,007,000, reflecting a reduction of 43.1% year-over-year[114]. Business Strategy and Opportunities - The company is actively seeking new business opportunities to diversify revenue sources and reduce risks due to ongoing trade disputes and the impact of COVID-19[10]. - Discussions are ongoing with a well-known discount retailer in China to develop procurement and distribution business, aiming to expand the customer base in China[10]. - The company aims to leverage its strong track record and experienced management team to seize growth opportunities in the future[10]. Financial Position - The company's current ratio decreased to approximately 0.7 times as of September 30, 2021, from approximately 0.8 times as of March 31, 2021, mainly due to a decrease in cash and cash equivalents[25]. - The company's debt-to-equity ratio increased to 83.8% as of September 30, 2021, from 78.8% as of March 31, 2021, primarily due to losses reducing total equity[25]. - The company's total equity as of September 30, 2021, was HKD 37,089,000, down from HKD 44,819,000 as of March 31, 2021[88]. - The company's bank overdrafts and loans totaled HKD 31,076,000 as of September 30, 2021, down from HKD 35,313,000 as of March 31, 2021, a reduction of 11.8%[125]. Shareholder Information - Major shareholders include Strategic Elite Limited with 235,950,000 shares (45.375%) and Total Clarity Investments Limited with 154,050,000 shares (29.625%) as of September 30, 2021[42][46]. - The company has issued and fully paid 520,000,000 shares with a par value of HKD 0.01 each as of September 30, 2021[128]. - The total number of issued shares remained unchanged at 520,000,000 shares from April 1, 2020, to September 30, 2021[128]. Employee and Training - As of September 30, 2021, the group had a total employee cost of approximately HKD 14,200,000, an increase from HKD 13,200,000 for the same period in 2020[35]. - The company has a total of 260 employees as of September 30, 2021, down from 295 employees as of March 31, 2021[35]. - The company has provided training for new employees to acquire necessary skills, while existing employees can enhance their production skills[35]. Corporate Governance - The company has adopted the principles and code provisions of the Corporate Governance Code as its corporate governance practices[78]. - The audit committee, consisting of four independent non-executive directors, reviewed the unaudited condensed consolidated financial results for the six months ended September 30, 2021[82]. - The company has implemented corporate governance measures to monitor compliance with non-competition agreements[66]. - The company believes that the dual role of the chairman and CEO, held by Mr. Zhuang, provides strong leadership for effective business decision-making[78]. Capital Expenditure and Commitments - The company plans to allocate HKD 22.1 million for acquiring properties and facilities in Hong Kong for logistics purposes, with HKD 21.5 million already utilized by September 30, 2021[41]. - The company has allocated HKD 3.7 million for developing an online business platform, with HKD 3.3 million already utilized by September 30, 2021[41]. - The company has no significant capital commitments or contingent liabilities as of September 30, 2021[36][37]. Compliance and Conduct - No incidents of employees violating the company's code of conduct were reported during the six-month period[80]. - The company did not purchase, sell, or redeem any of its listed securities during the six months ended September 30, 2021[81]. - The controlling shareholders have confirmed compliance with non-competition commitments, ensuring no engagement in competing businesses in Hong Kong, Macau, or other jurisdictions[64].

Financial Performance - The company recorded revenue of approximately HKD 62.7 million for the year ended March 31, 2021, a decrease of about 62.8% compared to HKD 168.5 million for the year ended March 31, 2020[9]. - Revenue from the United States accounted for approximately 87.6% and 78.6% of total revenue for the years ended March 31, 2020, and March 31, 2021, respectively[9]. - The gross profit margin declined from 7.6% for the year ended March 31, 2020, to a gross loss margin of 11.0% for the year ended March 31, 2021[9]. - The company reported losses of approximately HKD 47 million and HKD 44.7 million for the years ended March 31, 2020, and March 31, 2021, respectively[9]. - The company recorded a revenue decrease of approximately 105,800,000 HKD or about 62.8%, from approximately 168,500,000 HKD for the year ended March 31, 2020, to approximately 62,700,000 HKD for the year ended March 31, 2021[22]. - Revenue from special occasion dresses decreased from approximately 84,100,000 HKD to approximately 8,700,000 HKD, a decline attributed to a drop in sales volume from 610,700 units to 42,800 units[23]. - Revenue from bridesmaid dresses decreased from approximately 79,800,000 HKD to approximately 44,100,000 HKD, with sales volume dropping from 274,000 units to 152,600 units[23]. - The company reported a gross loss of approximately 6,900,000 HKD for the year ended March 31, 2021, compared to a gross profit of approximately 12,800,000 HKD for the previous year, resulting in a gross loss margin of 11.0%[25]. - The company recorded a loss of approximately 44,700,000 HKD for the year ended March 31, 2021, a decrease from a loss of approximately 47,000,000 HKD in the previous year[28]. Cost Control and Business Strategy - The ongoing US-China trade disputes and the impact of COVID-19 have created a challenging business environment, affecting overall performance[12]. - The company has implemented cost control measures since April 2020 to address prolonged business setbacks[12]. - Management is actively seeking new business opportunities to diversify revenue sources and reduce risks[12]. - The company has begun developing an online business platform to sell fashion apparel since November 2020[16]. - The company aims to leverage its strong track record and experienced management team to seize growth opportunities in the future[12]. - The company will continue to review its existing business and take appropriate measures to respond to any potential impacts[12]. Financial Position and Ratios - As of March 31, 2021, the company's cash and cash equivalents were approximately 500,000 HKD, down from approximately 32,700,000 HKD a year earlier[33]. - The current ratio decreased to approximately 0.8 times as of March 31, 2021, compared to approximately 1.7 times a year earlier, primarily due to a reduction in cash and cash equivalents[33]. - The company's debt-to-equity ratio was 78.8% as of March 31, 2021, down from 82.8% a year earlier, mainly due to a decrease in bank borrowings[33]. - Administrative expenses decreased by approximately 16,700,000 HKD or about 36.7%, from approximately 45,500,000 HKD to approximately 28,800,000 HKD, primarily due to cost control measures[26]. - Financing costs decreased by approximately 500,000 HKD or 23.8%, from approximately 2,100,000 HKD to approximately 1,600,000 HKD, mainly due to a reduction in average bank borrowings[26]. Corporate Governance - The board of directors is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance corporate value[64]. - The company has adopted the principles and code provisions of the Corporate Governance Code as set out in the Listing Rules of the Hong Kong Stock Exchange[64]. - During the reporting period, the company complied with the code provisions of the Corporate Governance Code, except for provision A.2.1[65]. - The board consists of capable directors, including executive and independent non-executive directors, ensuring a balanced governance structure[72]. - The chairman and CEO roles are currently held by the same individual, Mr. Zhuang Shuo, who is a co-founder with extensive industry experience[77]. - The board held a total of 9 meetings during the reporting period, with full attendance from all directors[76]. - Independent non-executive directors account for at least one-third of the board, ensuring compliance with the Listing Rules[80]. - The company has established a code of conduct for securities trading, which all directors confirmed adherence to during the reporting period[68]. - The board is responsible for setting strategies and overseeing their implementation, ensuring effective internal controls and risk management systems[81]. Employee Welfare and Training - As of March 31, 2021, the total number of employees in the group was 295, with 19 in Hong Kong and 276 in mainland China[144]. - The group maintained a gender distribution of 19 males and 11 females in Hong Kong, while in mainland China, there were 121 males and 155 females[144]. - The group emphasizes employee welfare by providing competitive compensation packages that exceed local minimum wage standards[145]. - The group has implemented a rigorous policy to ensure fair treatment of all employees, promoting diversity and equal opportunities[142]. - The group has invested in employee training and development opportunities to enhance knowledge and skills[141]. - The group has adhered to all relevant labor laws and regulations in both Hong Kong and mainland China without any violations reported[141]. - The group has established a comprehensive employee handbook detailing HR policies, including compensation, benefits, and dismissal procedures[145]. - The group aims to create a safe and healthy work environment to boost productivity and employee satisfaction[141]. - 100% of employees participated in training programs, with an average training time of 11.7 hours per employee, totaling 3,456 hours across 295 employees[158]. - Employee training participation by gender: 43.7% male and 56.3% female[158]. - Employee training participation by job level: 3.7% management, 38.3% administrative staff, and 58.0% production staff[158]. - Employee training participation by location: 6.4% in Hong Kong and 93.6% in mainland China[158]. - Average training hours by job level: 3.1 hours for management, 7.3 hours for administrative staff, and 15.2 hours for production staff[158]. Environmental and Social Responsibility - The company has committed to improving the accuracy of its ESG reporting and enhancing transparency of its ESG performance[127]. - The company has established an ESG committee involving the board, senior management, and employees to assess and manage ESG-related risks and opportunities[132]. - The ESG committee meets formally every six months to ensure timely execution of ESG measures[132]. - The company aims to provide responsible products and services while fulfilling its environmental and social responsibilities[130]. - The company actively participates in community initiatives, including donations and volunteer services, to create social value in local communities[190]. - The company has implemented various COVID-19 measures, including daily temperature checks and mandatory mask-wearing for all employees[154]. - The company has maintained a zero fatality rate since the start of its annual ESG reporting, with no significant work-related injuries reported during the period[153]. - The company has not reported any non-compliance incidents related to environmental laws and regulations during the reporting period[168]. - The company has initiated a partnership to install a solar renewable energy system on the rooftop of its Hong Kong office, which will sell generated electricity back to the grid, contributing to renewable energy efforts in Hong Kong[189]. - The company plans to procure biodegradable plastic bags for packaging in the near future to reduce environmental impact[187]. Risk Management - The board has established a risk management framework to identify, assess, and manage significant risks affecting the achievement of the group's objectives[110]. - The board conducted an annual review of the effectiveness of the risk management and internal control systems, concluding they are effective[111]. - The company emphasizes the importance of maintaining confidentiality regarding inside information before public disclosure[113]. - The company continues to manage and mitigate identified environmental risks associated with its operations, implementing effective monitoring measures[188].

Revenue Performance - For the six months ended September 30, 2020, KNT Holdings Limited recorded revenue of approximately HKD 41.1 million, a decrease of about 55.6% compared to HKD 92.6 million for the same period in 2019[7]. - Revenue from the United States accounted for approximately 79.6% of total revenue for the six months ended September 30, 2020, down from 90.5% in the same period of 2019[7]. - The company's revenue for the six months ended September 30, 2020, was HKD 41,104,000, a decrease of 55.7% compared to HKD 92,647,000 for the same period in 2019[75]. - Revenue from the United States market was HKD 32,682,000, a decline of 61.0% from HKD 83,810,000 in the previous year[95]. - Sales of special occasion dresses generated revenue of approximately HKD 7.5 million, down from HKD 47.3 million, with sales volume dropping from 336,400 units to 40,600 units[10]. - Sales of bridesmaid dresses decreased from approximately HKD 43.5 million to HKD 27.8 million, with sales volume declining from 144,000 units to 96,800 units[11]. Profitability and Loss - The company reported a loss of approximately HKD 16.5 million for the six months ended September 30, 2020, an increase of about 10.0% compared to a loss of HKD 15.0 million for the same period in 2019[7]. - Gross profit for the same period was HKD 4,144,000, down from HKD 9,804,000 in 2019, reflecting a significant decline in profitability[75]. - The company reported a pre-tax loss of HKD 36,960,000 for the six months ended September 30, 2020, compared to HKD 82,843,000 in 2019[101]. - The net loss for the period was HKD 16,489,000, compared to a net loss of HKD 15,021,000 in 2019, showing a continued trend of losses[76]. - The basic loss per share was HKD 3.2, compared to HKD 2.9 in the previous year, reflecting increased losses on a per-share basis[75]. Cost Management - The company has implemented cost control measures since April 2020 to address prolonged business downturns[9]. - Administrative expenses decreased by approximately HKD 11,200,000 or about 45.0% to approximately HKD 13,700,000, attributed to cost control measures and reduced travel expenses due to COVID-19[17]. - Financing costs increased by approximately HKD 200,000 or about 25.0% to approximately HKD 1,000,000, primarily due to an increase in average bank borrowings[18]. Assets and Liabilities - The company's cash and cash equivalents were approximately HKD 22,700,000 as of September 30, 2020, down from approximately HKD 32,700,000 as of March 31, 2020[24]. - Current assets decreased to HKD 77,203,000 from HKD 121,822,000, with cash and cash equivalents dropping to HKD 36,538,000 from HKD 48,669,000[77]. - Total liabilities decreased to HKD 60,334,000 from HKD 70,916,000, with bank borrowings slightly increasing to HKD 52,191,000 from HKD 49,235,000[78]. - The company's net asset value increased to HKD 69,604,000 as of September 30, 2020, up from HKD 59,481,000 as of March 31, 2020[78]. Shareholder Information - Major shareholders include Strategic Elite Limited holding 45.375% and Total Clarity Investments Limited holding 29.625% of the shares[40]. - The total issued shares as of September 30, 2020, is 520 million[40]. - The stock option plan allows for a maximum of 52,000,000 shares to be issued, representing 10% of the total issued shares as of the mid-term report date[49]. Business Environment and Strategy - The ongoing US-China trade disputes and the impact of COVID-19 have created a challenging business environment, affecting overall performance[8]. - Management is actively seeking new business opportunities to diversify revenue sources and mitigate risks[9]. - The establishment of the sales office in the U.S. has been postponed to the end of 2021 due to the impact of the U.S.-China trade war and COVID-19[39]. Impairment and Receivables - The company reported an impairment loss on trade receivables of HKD 7,524,000, indicating challenges in collecting outstanding debts[75]. - The company recognized an impairment provision for trade receivables amounting to HKD 14,575,000, resulting in net trade receivables of HKD 3,842,000 as of September 30, 2020[105]. Investments and Financing - The company secured a trade financing and revolving loan facility totaling HKD 28,000,000 from Bank A, along with a 16-month term loan of approximately HKD 1,300,000[63]. - A non-revolving term loan facility of HKD 5,000,000 was approved by Bank B, increasing from HKD 4,000,000, with the controlling shareholder providing an unconditional personal guarantee[65]. - The company made investments totaling HKD (18,236,000) in property, plant, and equipment during the six months ended September 30, 2020[83].

Financial Performance - The company reported revenue of approximately HKD 168.5 million for the year ended March 31, 2020, a decrease of about 25.3% from HKD 225.6 million for the year ended March 31, 2019[11]. - Revenue decreased from approximately HKD 225.6 million for the year ended March 31, 2019, to approximately HKD 168.5 million for the year ended March 31, 2020, a decline of about 25.3%[21]. - The company recorded a loss of approximately HKD 47 million for the year ended March 31, 2020, compared to a profit of approximately HKD 12.2 million for the year ended March 31, 2019[28]. - Gross profit fell from approximately HKD 65.3 million to approximately HKD 12.8 million, representing a decrease of about 80.4%[23]. - The gross profit margin decreased from 28.9% for the year ended March 31, 2019, to 7.6% for the year ended March 31, 2020[11]. - Administrative expenses increased by approximately 99.6% from approximately HKD 22.8 million to approximately HKD 45.5 million, primarily due to higher employee costs and professional fees[27]. - Cash and cash equivalents decreased to approximately HKD 32.7 million as of March 31, 2020, down from approximately HKD 97.2 million as of March 31, 2019[32]. - The current ratio declined to approximately 1.7 times as of March 31, 2020, compared to approximately 3.8 times as of March 31, 2019[32]. - The debt-to-equity ratio increased to 82.8% as of March 31, 2020, from 20.0% as of March 31, 2019, due to increased bank borrowings and losses[32]. Business Operations - The company sold approximately 877,100 products, including about 274,000 bridesmaid dresses, 2,400 wedding dresses, and 610,700 special occasion garments[11]. - Revenue from the United States accounted for approximately 93.6% and 87.6% of total revenue for the years ended March 31, 2019, and March 31, 2020, respectively[11]. - The average selling price of bridesmaid dresses decreased from HKD 316 to HKD 291, contributing to the revenue decline[21]. - The company recognized impairment losses totaling approximately HKD 13.4 million on trade receivables, properties, plant and equipment, and right-of-use assets[12]. - The ongoing US-China trade dispute and the impact of COVID-19 have created a challenging business environment, affecting overall performance[13]. - The company is actively seeking new business opportunities to diversify revenue sources and reduce risks[13]. - Cost control measures have been implemented since April 2020 to address the ongoing business downturn[13]. - The company aims to leverage its strong track record and experienced management team to seize growth opportunities in the future[13]. Governance and Management - The company has adopted the principles and code provisions of the Corporate Governance Code as a foundation for its governance practices[62]. - The independent non-executive directors confirmed their independence in accordance with the listing rules, ensuring a balanced board composition[77]. - The chairman and CEO roles are held by the same individual, which the board believes provides strong leadership for effective business decision-making[75]. - The company has established a robust internal control and risk management system to monitor operational and financial performance[78]. - The board is responsible for setting strategies and overseeing their implementation, ensuring accountability and transparency[78]. - The company has committed to regular reviews of board members' contributions and time commitment to their responsibilities[68]. - All directors are required to retire and seek re-election at the annual general meeting, promoting accountability[77]. - The company has established three committees: the audit committee, remuneration committee, and nomination committee, each with specific written terms of reference[84]. - The audit committee consists of four independent non-executive directors, ensuring oversight of the company's financial reporting system and internal control procedures[85]. - Continuous professional development for directors is emphasized, with internal briefings and relevant reading materials provided[82]. Environmental, Social, and Governance (ESG) Initiatives - The company established an ESG committee involving the board, senior management, and employees to assess and manage ESG-related risks and opportunities[129]. - A materiality assessment was conducted to identify significant ESG issues impacting the business and stakeholders, focusing on product responsibility and employee welfare[135]. - The company maintains a strong reputation by providing high-quality products and services, adhering to international standards and local regulations[137]. - The company is committed to protecting personal data and complies with relevant privacy laws, ensuring confidentiality of stakeholder information[140]. - The group emphasizes the importance of sustainable supply chain management, ensuring suppliers adhere to ethical and environmental standards[158]. - The group is committed to reducing its environmental impact while balancing business growth, adhering to all relevant environmental laws and regulations[161]. - Total greenhouse gas emissions (Scope 1 and 2) decreased from 778.9 tCO2e in 2019 to 714.4 tCO2e in 2020, a reduction of approximately 8.3%[166]. - The company will continue to monitor and improve its waste management policies to increase recycling rates and reduce landfill waste[171]. - The company actively plans green activities for employees as part of its sustainable development strategy[129]. Community Engagement - The company made a total of approximately HKD 87,000 in charitable donations during the fiscal year ending March 31, 2020[195]. - The company has actively participated in community activities, including donations and volunteer services, to support local community development[178]. - The company continues to support community initiatives and fulfill its social responsibilities[179]. - The company has evaluated the financial status of charitable organizations before making donations to prevent misuse of funds[178].

Financial Performance - For the six months ended September 30, 2019, KNT Holdings recorded revenue of approximately HKD 92.6 million, a decrease of about 39.8% from HKD 153.9 million for the same period in 2018[7]. - The gross profit margin fell from 24.1% for the six months ended September 30, 2018, to 10.6% for the same period in 2019[7]. - The company reported a loss of approximately HKD 15 million for the six months ended September 30, 2019, compared to a profit of approximately HKD 16.7 million for the same period in 2018[7]. - Gross profit decreased by approximately HKD 27.2 million or 73.5% to HKD 9.8 million, with gross margin dropping from 24.0% to 10.6% due to declines in both sales volume and average selling price[16]. - The company reported a loss before tax of HKD 14,936,000, compared to a profit of HKD 21,141,000 in the previous year[74]. - The net loss for the period was HKD 15,021,000, compared to a profit of HKD 16,676,000 in the prior year[75]. - Basic and diluted loss per share was HKD (2.9), compared to earnings of HKD 4.0 per share in the previous year[74]. - The company reported a tax expense of HKD 85,000 for the six months ended September 30, 2019, a significant decrease from HKD 4,465,000 in the same period of 2018[121]. Revenue Breakdown - Revenue from the sale of special occasion dresses decreased by approximately HKD 34.2 million, while revenue from bridesmaid dresses decreased by approximately HKD 22.3 million[11]. - Sales volume of special occasion dresses dropped from 563,000 units to 336,400 units, and the average selling price decreased from HKD 145 to HKD 141[12]. - Sales volume of bridesmaid dresses decreased from 207,600 units to 144,000 units, with the average selling price dropping from HKD 317 to HKD 302[12]. - The geographical revenue breakdown showed the United States contributing HKD 83,810,000, down 42.5% from HKD 145,759,000 year-on-year[116]. - Revenue for the six months ended September 30, 2019, was HKD 92,647,000, a decrease of 39.7% compared to HKD 153,906,000 for the same period in 2018[74]. - Sales of bridesmaid dresses amounted to HKD 43,535,000, down 33.8% from HKD 65,787,000 year-on-year[114]. Expenses and Costs - Administrative expenses rose by approximately HKD 14.4 million or 137.1% to HKD 24.9 million, driven by salary increases, higher professional fees post-IPO, and increased travel expenses[19]. - Financing costs decreased by approximately HKD 500,000 or 38.5% to HKD 800,000, mainly due to a reduction in average bank borrowings[20]. - The company incurred finance costs of HKD 770,000, down from HKD 1,317,000 in the previous year, indicating improved cost management[74]. - The foreign exchange loss for the period was HKD 2,076,000, compared to a loss of HKD 2,998,000 in the previous year, showing a slight improvement in currency exposure[75]. Cash Flow and Liquidity - As of September 30, 2019, the company's cash and cash equivalents were approximately HKD 63 million, down from HKD 97.2 million as of March 31, 2019, with a current ratio of 1.9, down from 3.8[26]. - Net cash used in operating activities for the six months ended September 30, 2019, was (41,989) thousand HKD, compared to (15,782) thousand HKD in 2018, indicating a significant increase in cash outflow[84]. - Net cash used in investing activities was (9,589) thousand HKD for the six months ended September 30, 2019, compared to a cash inflow of 13,720 thousand HKD in 2018, reflecting a negative shift in investment cash flow[84]. - Total cash and cash equivalents decreased by 34,131 thousand HKD during the six months ended September 30, 2019, compared to a decrease of only 1,333 thousand HKD in 2018, indicating a more challenging liquidity position[85]. - Cash and cash equivalents at the end of the period were 63,033 thousand HKD, significantly up from 9,249 thousand HKD in the previous year, showing a recovery in cash reserves despite the net decrease[85]. - The company reported a bank balance and cash of 71,734 thousand HKD at the end of the period, compared to 18,938 thousand HKD in 2018, indicating a strong improvement in cash management[85]. Shareholder and Capital Structure - Major shareholders include Strategic Elite Limited holding 45.375% and Total Clarity Investments Limited holding 29.625% of the issued shares[44]. - The company’s issued and paid-up capital increased to 520,000,000 shares as of September 30, 2019, reflecting a significant capital increase[139]. - A total of 104,000,000 ordinary shares were issued at an offering price of HKD 0.98 per share, raising total proceeds of HKD 101,920,000[142]. Corporate Governance - The company has adopted the principles and code provisions of the Corporate Governance Code as a basis for its corporate governance practices[66]. - The board confirms compliance with the Corporate Governance Code, except for the separation of roles between the chairman and CEO[68]. - The company has implemented corporate governance measures to monitor compliance with the non-competition agreement by controlling shareholders[63]. - The board believes that the dual role of the chairman and CEO held by Mr. Zhuang enhances effective business decision-making and strategy implementation[68]. Future Plans and Strategies - KNT Holdings aims to strengthen its market position by exploring new customer sources and expanding into new markets[10]. - The company plans to enhance its design and development capabilities to improve its overall competitiveness and market share[10]. - KNT Holdings will continuously assess its business strategies in response to market challenges for sustainable development[10]. - The company will continuously evaluate its business objectives and plans based on market conditions to align with growth and long-term interests[38]. Accounting and Reporting Changes - The company has adopted new accounting standards, including HKFRS 16 on leases, which may impact future financial reporting and asset management strategies[90]. - The company confirmed additional right-of-use assets equivalent to the amount of lease liabilities upon the initial application of HKFRS 16 on April 1, 2019, with a weighted average incremental borrowing rate of 4.0% applied[108]. - The total lease liabilities recognized on April 1, 2019, amounted to HKD 4,643,000, which includes current liabilities of HKD 2,180,000 and non-current liabilities of HKD 2,463,000[109]. - The company has made adjustments to the lease liabilities based on revised discount rates when lease terms change or purchase options are assessed[102].

Financial Performance - For the fiscal year ending March 31, 2019, the group recorded revenue of approximately HKD 225.6 million, an increase of about 8.3% compared to HKD 208.4 million for the previous year[14]. - Revenue from the United States accounted for approximately 93.6% of total revenue for the fiscal year ending March 31, 2019, up from 92.8% the previous year[14]. - The gross profit margin increased from 27.8% for the fiscal year ending March 31, 2018, to 28.9% for the fiscal year ending March 31, 2019[14]. - Net profit decreased by approximately 48.7% to HKD 12.2 million for the fiscal year ending March 31, 2019, down from HKD 23.8 million the previous year[14]. - Excluding non-recurring listing expenses, net profit for the fiscal years ending March 31, 2018, and 2019 was approximately HKD 31.9 million and HKD 32.8 million, respectively, reflecting an increase of about 2.8%[14]. - The group recorded revenue of approximately HKD 225.6 million for the year ended March 31, 2019, an increase of about 8.3% from HKD 208.4 million for the year ended March 31, 2018[22]. - Gross profit increased by approximately HKD 7.3 million or about 12.6% to approximately HKD 65.3 million, with the gross profit margin rising from 27.8% to 28.9%[26]. - Profit for the year decreased by approximately HKD 11.6 million or about 48.7% to approximately HKD 12.2 million, primarily due to increased listing expenses[34]. Sales and Product Performance - The group sold approximately 1,019,400 products, including about 363,100 bridesmaid dresses, 4,000 wedding gowns, and 652,300 special occasion garments[14]. - Revenue from special occasion dresses increased by approximately HKD 30.7 million, while revenue from bridesmaid dresses decreased by approximately HKD 15.1 million[24]. - The sales volume of special occasion dresses rose from 362,000 units to 652,200 units, despite a decrease in average selling price from HKD 191 to HKD 153[24]. Market Strategy and Challenges - The group plans to enhance its overall competitiveness and market share while exploring new customer sources and expanding into new markets[17]. - The company aims to strengthen its design and development capabilities and enhance one-stop solution services to continue its growth[17]. - The management anticipates facing challenges due to prolonged US-China trade disputes, political tensions, and global economic slowdown[17]. - The group is prepared to adapt its business strategies in response to changing economic conditions to ensure steady development and long-term growth potential[17]. - The group plans to expand its market presence and enhance design and development capabilities to strengthen its competitive position[23]. - The group anticipates facing challenges due to prolonged US-China trade disputes and global economic slowdown, but is prepared to adapt its business strategies accordingly[23]. Financial Position and Capital Management - As of March 31, 2019, the company's cash and cash equivalents were approximately HKD 97.2 million, up from HKD 10.7 million as of March 31, 2018[36]. - The current ratio increased to approximately 3.8 times as of March 31, 2019, compared to 1.4 times as of March 31, 2018, primarily due to the net proceeds from the IPO[36]. - The debt-to-equity ratio decreased to 20.0% as of March 31, 2019, from 137.7% as of March 31, 2018, attributed to the net proceeds from the IPO and an expanded capital base[36]. - The total employee cost for the year ended March 31, 2019, was approximately HKD 45.9 million, compared to HKD 41.9 million for the previous year[42]. - The net proceeds from the IPO, after deducting underwriting fees and other expenses, were approximately HKD 56.9 million[42]. - As of March 31, 2019, approximately HKD 4.1 million, or 7.2% of the net proceeds, had been utilized[43]. - The planned use of net proceeds includes 76% for establishing a second production facility, 10% for setting up a sales office in the U.S., and 10% for repaying bank loans[44]. Corporate Governance - The board of directors emphasized the importance of corporate governance and transparency in all business operations[65]. - The company has adopted the principles and code provisions of the Corporate Governance Code as the basis for its corporate governance practices[67]. - The board consists of 3 executive directors, 1 non-executive director, and 5 independent non-executive directors, ensuring compliance with the listing rules[81]. - The chairman and CEO roles are held by the same individual, Mr. Zhuang Shuo, who is a co-founder with extensive industry experience[78]. - The board held one meeting during the reporting period, with all directors attending[77]. - The company has established a code of conduct for securities trading, which all directors confirmed compliance with during the reporting period[70]. - The board is responsible for leading and monitoring the company’s affairs, ensuring effective internal controls and risk management systems[82]. - Independent non-executive directors ensure high standards of regulatory reporting and provide independent judgment on corporate actions[82]. - The company has appropriate insurance coverage for directors and senior management against legal actions arising from corporate activities[85]. - New directors receive a comprehensive orientation to understand the company’s operations and their responsibilities under the listing rules[85]. - The board will hold at least four meetings annually to discuss business development, operations, and financial performance[77]. Committees and Compliance - The company has established three committees: audit committee, remuneration committee, and nomination committee, each with specific written terms of reference[88]. - The audit committee is responsible for reviewing the company's financial reporting system and internal control procedures[89]. - The remuneration committee's responsibilities include recommending remuneration policies for all directors and senior management[92]. - The nomination committee is tasked with reviewing the board's structure, size, and diversity annually[100]. - The company emphasizes the importance of board diversity in its nomination process[101]. - The company has adopted a board diversity policy to enhance corporate governance and board effectiveness[104]. - The nomination committee believes the board is sufficiently diverse and has not set measurable targets[105]. - The company has established a risk management framework to identify, assess, and manage significant risks[115]. - The external auditor received a total fee of HKD 4,681,000 for audit and non-audit services, with HKD 1,200,000 for audit services and HKD 3,481,000 for non-audit services[121]. - The board is responsible for ensuring compliance with corporate governance policies and regulations[114]. - The company has implemented a risk management policy to mitigate identified significant risks[115]. - The nomination committee will review the board nomination policy to ensure its effectiveness[110]. - The company has engaged an independent professional firm to assist in monitoring its risk management and internal control systems[115]. - The board has conducted an annual review of the effectiveness of the risk management and internal control systems[116]. Environmental, Social, and Governance (ESG) Initiatives - The company has established an ESG governance framework involving the board, senior management, and employees to assess and manage ESG-related risks and opportunities[139]. - The company is committed to continuous improvement in its ESG reporting methods to enhance data accuracy and transparency of ESG performance[135]. - The company has adopted a shareholder communication policy to ensure that shareholder views and concerns are appropriately addressed[130]. - The company has no preset dividend payout ratio, and dividends are proposed based on the financial condition and factors outlined in the dividend policy[130]. - The company emphasizes effective communication with shareholders to strengthen investor relations and understanding of business performance and strategies[130]. - The company has initiated a process to enhance employee awareness of environmental issues through sustainable development strategies[137]. - The company is focused on maintaining compliance with all relevant laws and regulations as a key aspect of protecting the interests of shareholders, employees, customers, and the community[140]. - The company has established multiple channels for timely sharing of information and receiving feedback from stakeholders[142]. - The company aims to continuously improve communication methods and actively engage with stakeholders[143]. - The company has a commitment to sustainable development, integrating it into business processes and promoting environmental stewardship among employees and customers[137]. Employee and Labor Practices - The total number of employees is 419, with 22 in Hong Kong and 397 in mainland China[156]. - The gender distribution includes 8 males and 14 females in Hong Kong, while mainland China has 172 males and 225 females[156]. - The company adheres to all relevant labor laws and regulations, including the Employment Ordinance and Minimum Wage Ordinance in Hong Kong, with no violations reported[154]. - Employee compensation is competitive, exceeding local minimum wage standards, and includes comprehensive medical insurance and mandatory provident fund[157]. - The company emphasizes employee training and development opportunities to enhance skills and organizational capabilities[154]. - The company has established a strong reputation for providing high-quality products and services, adhering to international standards[146]. - No product recalls or violations of product quality laws were reported during the reporting period[151]. - The company is committed to protecting personal data and complies with the Personal Data (Privacy) Ordinance in Hong Kong[153]. - The company has implemented a quality assurance process for materials delivered by suppliers to ensure compliance with standards[147]. - The company actively engages with stakeholders through various communication methods, including annual reports and press releases[146]. - The company strictly adheres to local labor laws and has not encountered any incidents of child or forced labor during the reporting period[161]. - The company has implemented a comprehensive safety training program, including fire drills, to enhance employee awareness and preparedness[164]. - There were no significant occupational injuries or fatalities reported during the operational period, demonstrating compliance with health and safety regulations[162]. - The company emphasizes sustainable supply chain management, ensuring suppliers meet ethical and operational standards[166]. - The company has established a zero-tolerance policy for bribery, fraud, and money laundering, with no compliance issues reported during the period[171]. Environmental Impact and Sustainability - The group emitted a total of 911.1 tons of CO2 equivalent during the reporting period, with a density of 24.0 tCO2e per million HKD in revenue[177]. - The group purchased 1,309 MWh of electricity, 26,933 liters of diesel, and 26,277 cubic meters of water, with respective densities of 5.8 MWh, 119.4 liters, and 116.5 cubic meters per million HKD in revenue[177]. - The group generated approximately 6 tons of non-hazardous waste during the reporting period, including office waste, waste paper, and discarded fabric, and recycled printer cartridges, boxes, and paper[174]. - The group donated 1 million HKD to charity during the reporting period and received the "Public Welfare Excellence Award" for its contributions[181]. - The group has implemented various environmental protection measures to monitor resource usage and reduce energy consumption, including the use of LED lights and energy-efficient air conditioning systems[177]. - The group has not generated significant hazardous waste during the reporting period and will continue to monitor waste production and disposal methods[174]. - The group aims to minimize packaging materials used in the production process, which totaled 121 tons during the reporting period[178]. - The group has engaged external consultants to assess environmental impacts, ensuring compliance with safety standards for emissions and waste[177]. - The group actively manages identified environmental risks and implements mitigation measures in its investment decisions and future development plans[179]. Dividend and Shareholder Information - The proposed final dividend for the year ending March 31, 2019, is HKD 0.038 per ordinary share, totaling approximately HKD 19,800,000[193]. - The company declared a dividend of HKD 9,000 per ordinary share to its controlling shareholder, amounting to HKD 9,000,000[193]. - The annual general meeting is scheduled for August 23, 2019, where shareholders will vote on the proposed final dividend[194]. - The company will suspend share transfer registration from August 20, 2019, to August 23, 2019, to determine eligible shareholders for the annual general meeting[194]. - The proposed final dividend, subject to shareholder approval, is expected to be paid on October 8, 2019[195]. Financial Statements and Notes - The financial performance and asset and liability summary for the past four fiscal years are detailed on page 120 of the annual report[196]. - Details regarding the changes in property, plant, and equipment during the year are included in the notes to the consolidated financial statements[197]. - Information on bank borrowings as of March 31, 2019, is provided in the notes to the consolidated financial statements[198]. - Changes in the company's share capital for the year ending March 31, 2019, are detailed in the notes to the consolidated financial statements[199]. - The changes in reserves for the group and the company for the year ending March 31, 2019, are included in the consolidated statement of changes in equity and the notes to the consolidated financial statements[200].