Financial Performance - Total Gross Merchandise Value (GMV) for the year ended December 31, 2024, was HKD 8,589,825, representing a 2.0% increase from HKD 8,423,983 in 2023[10] - Total completed orders GMV for the same period was HKD 8,511,995, up 2.2% from HKD 8,330,130 in 2023[10] - Revenue for the year was HKD 3,839,509, a slight increase of 0.7% compared to HKD 3,811,706 in 2023[10] - Adjusted EBITDA decreased by 60.0% to HKD 52,186 from HKD 130,622 in the previous year[10] - The company reported a net loss attributable to shareholders of HKD 66,700, a significant decline from a profit of HKD 45,321 in 2023, marking a 247.2% change[10] - Cash position decreased by 5.6% to HKD 541,705 from HKD 573,593 in 2023[11] - Total equity attributable to shareholders fell by 12.8% to HKD 1,871,619 from HKD 2,145,348 in the previous year[11] - Capital expenditures on property, plant, and equipment dropped by 72.0% to HKD 72,504 from HKD 258,830 in 2023[10] - Adjusted free cash flow was negative HKD 33,438, an improvement of 22.4% from negative HKD 43,099 in 2023[10] Customer Engagement and Services - The "Street Market Same-Day Meal" service now covers over 90% of HKTVmall customers, exceeding the 75% target set for 2022[33] - HKTVmall launched a new group chat feature "ChicChat" in its app, allowing merchants to directly communicate with customers[34] - The introduction of the "Unlimited Add-On" feature has significantly increased customer engagement, with over 278,000 unique customers utilizing this feature in 2024[92] - The new eight-hour express delivery service has exceeded initial targets, with over 259,000 products available for delivery within eight hours, surpassing the goal of 120,000 products set at the beginning of 2024[90] - Customer purchase frequency using the eight-hour express delivery service is 33.0% higher than that of customers using standard delivery services[94] Product and Market Expansion - The company plans to expand its market presence in Southeast Asia, targeting a 10% market share by the end of 2024[76] - HKTVmall aims to expand its product offerings to 100,000 items by 2025 to cater to new residents in Hong Kong[97] - New product launches in the pet supplies category are expected to contribute an additional HKD 50 million in revenue in Q1 2024[79] - The company is exploring potential acquisitions to enhance its product offerings and market reach, with a focus on technology-driven solutions[76] Operational Efficiency and Cost Management - The company has implemented a new membership system effective January 1, 2024, lowering the free shipping threshold for VIP, Gold VIP, and Diamond VIP members to enhance customer experience[93] - The delivery cost as a percentage of total merchandise transaction value has increased in 2024 due to strategic measures aimed at enhancing customer shopping experiences[88] - The mixed gross margin/commission rate has been adjusted to reflect shared expenses offset, indicating a focus on improving profitability[86] - Operating expenses rose by HKD 192,500,000 to HKD 2,171,800,000 in 2024, maintaining a percentage of 21.7% relative to the total gross merchandise transaction value[110] Environmental, Social, and Governance (ESG) Initiatives - The company has increased the recycling volume and scope of waste, reducing the amount sent to landfills[176] - The company plans to explore the use of more electric vehicles to reduce greenhouse gas emissions, having purchased its first refrigerated electric truck by the end of 2023[176] - The company has implemented a reward program for merchants to encourage the reduction of plastic usage and the transition to environmentally friendly materials[176] - The company has established a cross-functional team to monitor environmental, social, and governance performance across departments[178] - The company is committed to reducing its carbon footprint and has set carbon reduction targets to manage climate change risks and opportunities[176] Future Projections and Strategic Planning - Total gross merchandise value (GMV) target for 2025 is HKD 8,370,000,000, with 2024 performance at HKD 8,580,000,000[153] - HKTVmall's total GMV for 2025 is targeted at HKD 7,800,000,000, while 2024 performance was HKD 8,270,000,000[156] - Adjusted EBITDA margin for 2025 is projected to be approximately 3.7% to 3.9%, equating to HKD 290,000,000 to HKD 310,000,000[156] - The company plans to extend its core capital expenditure plan of HKD 250,000,000 to HKD 300,000,000 for at least two more years, covering 2025 to 2028[163] Risk Management and Compliance - The company conducted an annual review of its risk management and internal control systems, finding them reasonable and effective without significant deficiencies[179] - The company has implemented various measures to ensure compliance with intellectual property laws and protect third-party rights[195] - The company emphasizes the importance of data protection and has established comprehensive policies to safeguard personal information[196] - A 24-hour managed security operations center has been established to enhance cybersecurity measures[197]

Financial Performance - Total Gross Merchandise Value (GMV) for the year ended December 31, 2024, was HKD 8,589,825, representing a 2.0% increase from HKD 8,423,983 in 2023[10] - Total completed orders GMV for the year ended December 31, 2024, was HKD 8,511,995, up 2.2% from HKD 8,330,130 in 2023[10] - Revenue for the year ended December 31, 2024, was HKD 3,839,509, a slight increase of 0.7% compared to HKD 3,811,706 in 2023[10] - Adjusted EBITDA for the year ended December 31, 2024, was HKD 120,983, down 1.4% from HKD 122,717 in 2023[10] - The company reported a net loss attributable to shareholders of HKD 66,700 for the year ended December 31, 2024, compared to a profit of HKD 45,321 in 2023, marking a 247.2% decline[10] - Cash position as of December 31, 2024, was HKD 541,705, a decrease of 5.6% from HKD 573,593 in 2023[11] - Total capital expenditure for property, plant, and equipment was HKD 72,504, down 72.0% from HKD 258,830 in 2023[10] - The number of issued shares decreased to 788,546 thousand shares, a reduction of 11.3% from 888,546 thousand shares in 2023[11] - The company’s net asset value per share was HKD 2.37, a decrease of 1.5% from HKD 2.41 in 2023[11] - Adjusted free cash flow for the year ended December 31, 2024, was (HKD 33,438), an improvement of 22.4% from (HKD 43,099) in 2023[10] Market and Business Expansion - The company plans to recruit more professionals from mainland China, aiming for 15% of office staff to be mainland talent by the end of 2027[45] - HKTVmall officially launched in February 2015, partnering with over 333 merchants from Hong Kong, Japan, and South Korea[25] - The company expanded its delivery service coverage to South Lantau Island and other remote areas in February 2021[29] - HKTVmall expanded its delivery services to Australia and Canada, becoming the third and fourth regions outside Hong Kong for delivery[34] - The company aims to expand its merchant base and product offerings to enhance consumer choice and leverage long-tail effects[66] - The company plans to invest in new technology development to enhance product offerings and improve operational efficiency[78] - Market expansion efforts are focused on increasing presence in Southeast Asia, targeting a 10% market share by 2025[78] - The company aims to expand its product offerings to 100,000 items by 2025 to cater to new residents in Hong Kong[97] Customer Engagement and Services - The company launched a new service "Street Market Same-Day Grocery" in October 2022, providing fresh produce delivery within 3 hours[31] - The "Street Market Same-Day Meal" service now covers over 90% of HKTVmall customers, exceeding the 75% target set for 2022[33] - HKTVmall launched a new group chat feature "ChicChat" in its app, allowing merchants to directly communicate with customers[34] - The upgraded user interface of HKTVmall allows customers to easily revisit live shows and view key product information and promotions[96] - The new membership system effective January 1, 2024, lowered the free shipping threshold for VIP, Gold VIP, and Diamond VIP members to enhance customer experience[93] - The eight-hour express delivery service covers over 259,000 products, exceeding the initial target of 120,000 products by year-end 2024[90] - Customers using the eight-hour express delivery service have a purchase frequency 33.0% higher than those using standard delivery services[94] Product and Revenue Growth - The total revenue from the e-commerce segment reached HKD 2.057 billion in 2024, compared to HKD 1.984 billion in 2023[68] - The total merchandise transaction value for completed orders in 2024 is HKD 8.192 billion, slightly down from HKD 8.210 billion in 2023[68] - The total merchandise transaction value for the Hong Kong e-commerce business reached HKD 8,589,800,000 in 2024, a 2.0% increase from HKD 8,424,000,000 in 2023[56] - The number of independent customers shopping on the Hong Kong e-commerce platform increased to 1,519,000 in 2024, up from 1,507,000 in 2023[62] - The average shopping frequency per customer remained stable at 4.6 times in Q4 2024, consistent with Q4 2023[62] - The pet supplies category saw a significant year-on-year growth of 26.2%, achieving a total merchandise transaction value of HKD 770,000,000[61] Operational Challenges and Strategic Adjustments - The company faces various operational risks, including economic fluctuations and competition, which may impact its core business performance and profitability[140] - The management expects significant challenges in 2025 and 2026, necessitating strategic investments and careful capital management[146] - The company plans to slow down the deployment of automated retail stores in the UK and will reassess the project's feasibility by the end of 2025[48] - The company has completed two strategic acquisitions in the last quarter, aimed at diversifying its product portfolio and enhancing market competitiveness[78] Environmental, Social, and Governance (ESG) Initiatives - The company has increased the recycling volume and scope of waste, reducing the amount sent to landfills[176] - The company plans to purchase its first refrigerated electric truck by the end of 2023 to reduce greenhouse gas emissions[176] - The company has implemented energy-saving measures, including the use of energy-efficient air conditioning systems and low-energy LED office lighting[176] - A reward program has been launched to encourage merchants to reduce plastic usage and switch to environmentally friendly materials[176] - The company has identified four key environmental, social, and governance (ESG) issues as "very important" based on stakeholder feedback[184] - The company has established a cross-functional team to monitor ESG performance across departments[178] Compliance and Risk Management - The company emphasizes the importance of data protection and has established comprehensive policies to safeguard personal information[196] - A 24-hour managed security operations center has been established to enhance cybersecurity measures and protect system integrity[197] - The company has a zero-tolerance policy towards bribery, fraud, and corruption, ensuring fair investigations of all reported incidents[200] - Continuous education and training on data protection are prioritized to enhance employee awareness and responsibility[196]

Financial Performance - The total merchandise trading volume for the year 2024 reached HKD 8,589,800,000, representing a year-on-year growth of 2.0% compared to HKD 8,424,000,000 in 2023[4]. - Adjusted EBITDA for 2024 was HKD 329,200,000, slightly down from HKD 322,700,000 in 2023, indicating a stable performance despite challenges[4]. - The net loss for 2024 was HKD 66,700,000, compared to a profit of HKD 45,300,000 in 2023, primarily due to operational losses in new exploration and technology businesses[4]. - Cash and cash equivalents stood at HKD 712,500,000 as of December 31, 2024, down from HKD 935,400,000 in 2023, mainly due to share buybacks totaling HKD 220,400,000[4]. - The adjusted EBITDA margin for completed orders in 2024 was 4.0%, up from 3.1% in 2023, driven by a 0.9% increase in gross margin and mixed commission rates[4]. - The overall gross margin and mixed commission rate for 1P and 3P businesses reached 23.2% in 2024, compared to 22.3% in 2023[4]. - The total gross merchandise value from new exploration projects reached HKD 328,300,000, a significant increase from HKD 131,100,000 in 2023, primarily driven by the street market and Everuts[6]. - The adjusted EBITDA loss for 2024 was approximately HKD 186,500,000, up from HKD 126,200,000 in 2023, mainly due to increased operational costs associated with business growth and R&D expenses[6]. - The group reported a net loss of HKD 66.7 million in 2024, compared to a profit of HKD 45.3 million in 2023, with adjusted EBITDA of HKD 121 million[80]. - The adjusted EBITDA for the Hong Kong e-commerce business was HKD 329.2 million in 2024, up from HKD 256.4 million in 2023[81]. Customer Metrics - The number of independent customers increased to 1,519,000 in 2024, up from 1,507,000 in 2023, indicating a growing customer base[4]. - Monthly active app users slightly decreased to approximately 1,600,000 in December 2024, down from 1,680,000 in December 2023[4]. - The average shopping frequency per customer remained stable at 4.6 times in Q4 2024, consistent with Q4 2023[29]. - The total product offerings for consumers reached approximately 2,200,000 in December 2024, a significant increase from about 1,600,000 in December 2023[35]. - The number of merchants and suppliers supporting the Hong Kong e-commerce business grew to around 7,000 in December 2024, up from over 6,400 in December 2023[35]. Market and Operational Strategies - The company aims to hire more professionals from mainland China, targeting 15% of office staff to be mainland talent by the end of 2027, to enhance market insights and consumer understanding[12]. - The company faces challenges including a shortage of technology talent, particularly in AI and big data analytics, impacting innovation and competitiveness[9]. - The company emphasizes long-term survival over short-term profits, focusing on sustainable development strategies to ensure competitiveness[8]. - The company has transformed from a telecommunications provider to an online shopping leader within ten years, showcasing its adaptability to market changes[7]. - The company plans to enhance its 1P business gross margin by expanding supplier sources, including direct imports from overseas[34]. - The company is focusing on market expansion strategies, particularly in the pet supplies sector, which has shown a growth trajectory in recent quarters[41]. Innovations and New Services - The "Street Market Instant Delivery" service offers delivery of fresh ingredients within three hours, showing strong growth in 2024, exceeding expectations[14]. - The introduction of a simplified Chinese version of HKTVmall aims to attract more users from mainland China and enhance market influence[13]. - The "Unlimited Add-On" feature allowed over 278,000 unique customers to increase their average order value by enabling additional purchases without extra shipping fees[53]. - The redesigned HKTVLive platform attracted over 50,000 views for a promotional live show, generating over HKD 400,000 in total merchandise transaction value[54]. - The introduction of the eight-hour express delivery service in December 2024 exceeded the initial target of covering 120,000 products, with over 259,000 products available for delivery within eight hours[50]. Financial Position and Investments - The group has a strong cash position with no bank deposits pledged as collateral for bank financing arrangements as of December 31, 2024, ensuring sufficient funds for operational needs[86]. - The group invested HKD 170.8 million in other financial assets as of December 31, 2024, a decrease from HKD 361.8 million in 2023[83]. - The group plans to continue leveraging internal resources and bank financing to meet future capital expenditure needs while maintaining a prudent approach[87]. - The company plans to utilize net proceeds from the subscription to expand its e-commerce and related businesses, with a total allocation of approximately HKD 453.2 million[89]. - The company anticipates significant challenges in the retail environment in Hong Kong and the UK, leading to a cautious financial management approach and a focus on strategic investments[93]. Shareholder Returns and Dividends - The company proposed a special dividend of HKD 0.38 per share to celebrate the 10th anniversary of HKTVmall[5]. - The board does not recommend the payment of an interim dividend for the six months ending June 30, 2024, and no annual dividend for the year ending December 31, 2024[162]. - The company plans to distribute dividends based on approximately 30% to 60% of adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA)[159]. - A special dividend of HKD 0.38 per share has been proposed to celebrate HKTVmall's 10th anniversary and acknowledge shareholder support[20]. Challenges and Market Conditions - The local cultural influence is declining, with Hong Kong's entertainment industry facing challenges compared to the thriving cultural industries in mainland China and nearby regions[11]. - Consumer spending power is observed to be weakening, aligning with overall retail market performance[1]. - A major competitor is entering the untapped online market, which may exert additional pressure on local online and offline retailers[1]. - The company anticipates significant impacts on retail business growth due to ongoing economic decline and increased consumer travel outside Hong Kong[101]. Governance and Compliance - The company has adhered to the corporate governance code as per the Hong Kong Stock Exchange regulations throughout the reporting period[156]. - The audit committee has reviewed and discussed the financial performance for the year ending December 31, 2024, with management[158]. - The establishment of the Environment, Social, and Governance (ESG) Committee is effective from March 27, 2025, to oversee the group's ESG matters[166].

Financial Performance - Total gross merchandise value for the group reached approximately HKD 4,235,500,000, representing a 4.9% increase compared to the same period last year, outperforming the overall retail market in Hong Kong [7]. - Revenue for the period was HKD 1,897,548, reflecting a 3.8% increase compared to HKD 1,828,567 in the previous year [9]. - The company reported a net loss of HKD 27,478, a decline of 156.4% from a profit of HKD 48,696 in the previous year [9]. - Total gross merchandise value for completed orders gross merchandise value reached HKD 4,199,746, up 5.2% from HKD 3,992,883 year-on-year [9]. - The company reported a net loss of HKD 27,500,000 for the first half of 2024, compared to a profit of HKD 48,700,000 in the same period of 2023 [55]. - Total revenue for the six months ended June 30, 2024, was HKD 1,897,548, an increase of 3.7% from HKD 1,828,567 for the same period in 2023 [74]. - The company reported a loss before tax of HKD 28,899 compared to a profit of HKD 43,400 in the previous year, reflecting a significant decline [74]. - The company reported a total comprehensive loss of HKD 14,093 for the period, compared to a total comprehensive income of HKD 53,188 in the previous year [75]. E-commerce Growth - The group has maintained a steady growth in its e-commerce business, which has been operational for ten years, focusing on continuous improvement and innovation [7]. - The overall strategy includes exploring international markets and diversifying business models to avoid stagnation and potential market exit [7]. - Active users of the HKTVmall app increased to 1,647,000 in June 2024, up from 1,581,000 in June 2023, reflecting a growth trend [16]. - The number of independent customers shopping on HKTVmall rose by 61,000 to 1,218,000 in the first half of 2024, compared to 1,157,000 in the same period of 2023 [17]. - The total merchandise transaction value for products eligible for the eight-hour express delivery service grew approximately 130.0% from December 2023 to June 2024, exceeding the initial target of 120,000 products [38]. - The "Street Market Same-Day Delivery" service saw its total merchandise transaction value grow from HKD 23.3 million in the first half of 2023 to HKD 107.9 million in the first half of 2024, representing a year-on-year growth of 363.1% [43]. - Everuts, launched in January 2023, achieved a total merchandise transaction value of HKD 22.7 million in the first half of 2024, a 136.5% increase compared to the same period in 2023 [43]. Cost Management and Profitability - Adjusted EBITDA decreased by 54.5% to HKD 37,596 from HKD 82,580 year-on-year, with an adjusted EBITDA margin of 0.9% [9]. - The gross profit margin increased to 22.9% in H1 2024 from 22.3% in H1 2023, driven by improved margins in both 1P and 3P businesses [24]. - The 1P business gross margin was intentionally raised to 25.0% in H1 2024, up from 23.5% in H1 2023, through active pricing strategies and cost management [25]. - The company reported a significant non-cash item of investment property valuation loss amounting to HKD 8,550,000 in the first half of 2024 [12]. - Other operating expenses increased by HKD 130,500,000 to HKD 1,044,200,000 in the first half of 2024, up from HKD 913,700,000 in the first half of 2023 [49]. - Delivery costs accounted for 11.8% of the total completed order merchandise transaction value in the first half of 2024, up from 10.9% in the first half of 2023 [53]. Strategic Initiatives - The company is actively promoting two innovative business models: "Street Market Same-Day Delivery" and the global purchasing platform "Everuts," aiming to expand online shopping offerings [7]. - The company plans to invest in advertising and marketing to expand its user base beyond 1.6 million users and attract new customers [8]. - The company aims to increase customer loyalty and shopping frequency on HKTVmall through improved service offerings [35]. - The company is developing a fully automated retail store system, with the first store located in Manchester, UK, expected to enhance efficiency over the next one to two years [45]. - The company plans to allocate approximately HKD 200 million for the expansion of its electronic delivery center in Tseung Kwan O, expected to be completed by the end of 2023 [60]. Market Conditions and Challenges - The retail sales value in Hong Kong for the first half of 2024 decreased by 6.5%, while online retail sales value saw a slight decline of 0.3% compared to the same period last year [7]. - The company anticipates challenges in the retail environment in Hong Kong, maintaining a cautious yet flexible approach to manage its business [63]. - The company recognizes the need for innovation to maintain its unique advantages in the competitive landscape of Hong Kong's retail sector [7]. - The group incurred a loss of HKD 84,500,000 in the new exploration and technology segment for the first half of 2024, compared to a loss of HKD 48,000,000 in the same period of 2023 [56]. Cash Flow and Financial Position - Free cash flow improved significantly to HKD 47,250, compared to a negative HKD 26,560 in the same period last year, marking a 277.9% increase [9]. - Cash position increased by 33.4% to HKD 765,338 from HKD 573,593 at the end of December 2023 [10]. - The group generated a net cash inflow from operating activities of HKD 176,500,000 during the first half of 2024 [58]. - The company reported a significant increase in cash and cash equivalents, with a net increase of HKD 254,167,000 compared to a decrease of HKD 95,632,000 in the prior year [83]. - The total cash position increased primarily due to a net realization of financial assets of HKD 147,900,000 [58]. Shareholder Information - The company has a total of 2,165 full-time employees as of June 30, 2024, down from 2,214 as of December 31, 2023 [73]. - The company did not declare any interim dividend for the six months ended June 30, 2024, consistent with the same period in 2023 [122]. - The board has adopted a dividend policy aimed at providing reasonable returns to investors while retaining sufficient capital for sustainable growth [165]. - The company expects to distribute dividends at 30% to 60% of adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) based on current payout ratio guidelines [165].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不 對 因 本 公 告 全部或任何部分內容而產生或因倚賴該等內容而引致之任何損失承擔任何責 任。 香 港 科 技 探 索 有 限 公 司 Hong Kong Technology Venture Company Limited （股份代號：1137） （根據公司條例於香港註冊成立之有限公司） 截至二零二四年六月三 十 日止六個月 之 中 期 業 績 | --- | --- | |-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ...

Financial Performance - Direct merchandise sales for 2023 amounted to HKD 2,393,000,000, a slight decrease from HKD 2,425,600,000 in 2022[12] - The group reported a net profit of HKD 45,321,000 for 2023, a decrease of 78.6% compared to HKD 212,204,000 in 2022[21] - Adjusted EBITDA for the year was HKD 122,717,000, down 61.2% from HKD 316,388,000 in the previous year[27] - Revenue for the year was HKD 3,811,706,000, a slight decrease of 0.4% from HKD 3,828,051,000[27] - The total gross merchandise value (GMV) reached HKD 8,423,983,000, reflecting a 1.8% increase from HKD 8,276,171,000[27] - The net profit margin for the year was 0.6%, down from 2.6% in 2022[27] - The total gross merchandise transaction value for the year 2023 was HKD 8,210,300,000, showing a slight increase from HKD 8,188,100,000 in 2022, reflecting a moderate year-on-year growth rate due to economic constraints and slow retail recovery[76] - The total gross merchandise value of completed orders increased by 1.7% to HKD 8,330,100,000 in 2023, compared to HKD 8,188,100,000 in 2022[150] - The company's revenue decreased by 0.4% year-on-year to HKD 3,811,700,000 in 2023, down from HKD 3,828,100,000 in 2022[150] Operating Expenses - Other operating expenses increased by HKD 110,600,000 to HKD 1,979,300,000 in 2023, compared to HKD 1,868,700,000 in 2022[13] - The operating expenses for the Hong Kong e-commerce segment were HKD 1,740.7 million, which is 21.2% of the total merchandise transaction value in 2023, up from 20.5% in 2022[14] - The new exploration and technology segment's main operating expenses increased to HKD 136.5 million in 2023 from HKD 76.0 million in 2022[14] - The e-commerce operation and support costs as a percentage of total gross merchandise value rose from 4.6% in 2022 to 4.8% in 2023[156] - Operating expenses for O2O store operations increased from 1.8% of total completed order GMV in 2022 to 2.4% in 2023, attributed to a shift back to point-to-point delivery services post-COVID[173] Marketing and Promotions - The company launched a large promotional campaign in November and December 2023, which included distributing cash vouchers of at least HKD 3,000 to HKTVmall users, leading to increased costs[17] - Marketing and promotional expenses represented 2.7% of the total merchandise transaction value in 2023, compared to 2.4% in 2022[14] - A marketing campaign titled "Mom Says It's Good" was launched on November 2, 2023, featuring advertisements in 58 MTR stations and distributing cash vouchers worth at least HKD 3,000 to HKTVmall users[122] - The company has initiated a significant marketing campaign, including creative advertisements covering over 50 MTR stations to promote HKTVmall[63] Customer Engagement and Expansion - The company has established a high-interaction environment through its global interactive shopping live broadcasts, enhancing community engagement with target customers[9] - The company expanded delivery services to cover remote areas, aiming to attract new customer segments[53] - The number of independent customers increased by approximately 104,000 in 2023, reaching a total of about 1,507,000 independent customers[102] - Monthly active app users increased from 1,520,000 in December 2022 to 1,680,000 in December 2023, peaking at 1,780,000 in November 2023[125] - The company aims to enhance user engagement by promoting less frequently purchased product categories and attracting new customers through strategic discounts[122] Strategic Initiatives - The company plans to seize new market opportunities with a new strategic direction[24] - The company is focusing on continuous system design improvements and store operation reviews to enhance future large-scale deployment effectiveness and efficiency[11] - The company is committed to investing in new concepts, technologies, and business developments over the next three to five years, requiring resource allocation and funding[70] - The company is focusing on strengthening its e-commerce foundation by expanding its online merchant base and diversifying product offerings[121] Product and Service Development - The company launched its first automated retail store, "in:Five," in Manchester, UK, allowing customers to pick up products via an app within minutes[149] - The company has launched a second-hand goods trading platform, "EcoMart," to encourage sustainable consumption and strengthen customer connections[65] - The company introduced a new "Display Store" model in December 2023, allowing customers to find independently operated online stores on HKTVmall's search engine[87] - The company expanded its product offerings to approximately 1,600,000 items through over 6,400 merchants and suppliers by December 2023[104] Logistics and Delivery - The company expects to enhance the efficiency of its "last mile" delivery resources through a merchant delivery program launched in the second half of 2022[16] - The "Street Market Same-Day Delivery" service now covers over 90% of HKTVmall's existing customer base, exceeding the 75% target set for 2022[87] - The third-party logistics service enabled a reduction in order-to-delivery time to 8 hours, with significant transaction growth: 198% for a small equipment merchant, 84% for a personal care merchant, and 62% for a pet merchant compared to the same period in 2022[128] - HKTVmall expanded its "last mile" delivery service to the UK, offering nearly 700,000 product choices[86] Market Challenges - The company is facing competitive pressure from domestic physical stores and online shopping platforms, necessitating the introduction of more merchants from outside Hong Kong and potentially engaging in price wars to gain market share[68] - The company is considering adjustments to its future strategies in response to changing consumer behaviors and increased competition from domestic and cross-border retail[90] Financial Health - As of December 31, 2023, cash position is HKD 573,593, a decrease of 18.7% from HKD 705,807 in the previous year[42] - Total equity attributable to shareholders is HKD 2,145,348, down 2.9% from HKD 2,208,793[42] - The number of issued shares decreased by 3.7% to 888,546 thousand shares from 923,090 thousand shares[42] - The net asset value per share increased by 0.8% to HKD 2.41 from HKD 2.39[42] Employee and Corporate Governance - The company reported a gender distribution of 38.9% male and 34.4% female among its workforce[196] - The age group distribution shows 37.1% under 30 years, 37.2% between 30-50 years, and 37.8% over 50 years[196] - 49.8% of the workforce is located outside of Hong Kong, indicating a significant geographical spread[196] - The company provides up to two days of onboarding and safety training for frontline staff[198] - The company has implemented various cybersecurity measures, including a 24-hour managed security operations center and regular security assessments by certified third parties[190]

Financial Performance - For the first half of 2023, HKTVmall recorded a total merchandise transaction value of approximately HKD 4,028,000,000, a decrease of 3.8% compared to approximately HKD 4,186,000,000 for the same period in 2022[7]. - The total merchandise transaction value based on completed orders for the first half of 2023 was HKD 3,986,600,000, compared to HKD 4,135,300,000 in the first half of 2022[10]. - The total merchandise transaction value for the first half of 2023 was HKD 3,986,600,000, representing a decline of 3.6% compared to HKD 4,135,300,000 in the first half of 2022[48]. - The group recorded a net profit of HKD 48.7 million in H1 2023, down from HKD 127.8 million in H1 2022, with adjusted EBITDA of HKD 82.6 million compared to HKD 195.6 million in the previous year[57]. - The company reported a profit of HKD 48,696,000 for the six months ending June 30, 2023, compared to HKD 127,849,000 for the same period in 2022[114]. - The net profit for the period was HKD 48,696, a significant decline of 61.9% from HKD 127,849 in the same period last year[132]. - Basic earnings per share decreased to HKD 0.05 from HKD 0.14, reflecting a 64.3% drop[132]. - Revenue for the six months ended June 30, 2023, was HKD 1,828,567, a decrease from HKD 1,922,144 in the same period of 2022, representing a decline of approximately 4.9%[151]. - Revenue from direct merchandise sales was HKD 1,162,383, down from HKD 1,210,255, indicating a decrease of about 4.0%[162]. - Revenue from licensed sales and other service income was HKD 606,010, compared to HKD 641,745, reflecting a decline of approximately 5.6%[162]. Customer Engagement and Behavior - The average purchase frequency per customer in Q2 2023 was 4.80 times, down from 5.09 times in Q4 2022[9]. - The number of independent customers reached 1,229,000 in the first half of 2023, an increase from 1,107,000 in the same period of 2022[12]. - The number of independent customers who shopped on HKTVmall increased from 1,107,000 in the first half of 2022 to 1,229,000 in the first half of 2023, indicating a structural change in consumer shopping behavior[28]. - The average retention rate of senior members in the "HKTVmall Senior Club" is 64.0% higher than that of general customers, with a 97.0% increase in total merchandise transaction value in Q2 2023 compared to Q2 2022[41]. - The company emphasized maintaining existing customer online shopping habits while expanding the customer base[7]. Operational Efficiency and Costs - The mixed commission rate slightly decreased to 21.7% in the first half of 2023, compared to 22.1% in the same period of 2022[14]. - Delivery costs as a percentage of total merchandise transaction value decreased from 11.4% in the first half of 2022 to 10.6% in the first half of 2023[53]. - Other operating expenses decreased by HKD 3,600,000 to HKD 913,700,000 in the first half of 2023, with delivery costs and marketing expenses being the main operational cost items[50]. - E-commerce operating and support costs increased from 4.6% of total completed order merchandise trading volume in H1 2022 to 5.1% in H1 2023, primarily due to increased talent resources and related expenses from diversified business expansion[54]. - Operating expenses for O2O store operations increased from 2.0% of total merchandise transaction value in the first half of 2022 to 2.4% in the first half of 2023[74]. Strategic Initiatives and Expansion - HKTVmall expanded its product offerings to over 1,300,000 items as of June 2023, up from over 1,000,000 items in June 2022[12]. - The company aims to adjust the gross margin of its 1P business to 23.5%, down from 26.8% in the first half of 2022, to promote sales of less frequently purchased products online[33]. - The company is adapting its business model to align with changes in the market environment, acknowledging that it cannot change the broader social situation[22]. - The company plans to expand consumer coverage by enhancing rapid logistics services for wet market products, attracting both existing and new customers[64]. - The company plans to expand its delivery capacity by renovating an existing 30,000 square feet facility, expected to be completed in Q1 2025[130]. - A new distribution center of approximately 200,000 square feet is planned, with about 170,000 square feet dedicated to smart delivery, expected to double the capacity of the current center by 2027[130]. - The company plans to extend its service range to Australia and Canada, targeting a launch in Q3 to Q4 of 2023[90]. - The company is actively seeking new exploration projects to ensure continuous progress and push the company to new heights[45]. Market Challenges and Competition - The management noted that due to intense competition, the gross profit margin has declined, despite effective control of operational expenses, leading to a decrease in profitability[21]. - The first half of 2023 did not experience the same surge in demand for grocery and personal care products as seen in early 2022 due to the pandemic[27]. - The total merchandise transaction value for grocery and miscellaneous goods decreased by HKD 340 million due to the absence of demand spikes seen in February and March 2022, but it remains the largest contributing product category for HKTVmall[30]. - The group anticipates a moderate growth in total merchandise turnover for HKTVmall in 2023, influenced by economic challenges and increased interest rates[107]. Financial Position and Investments - The group invested HKD 375.2 million in other financial assets as of June 30, 2023, up from HKD 344.5 million as of December 31, 2022[58]. - The total cash position of the group as of June 30, 2023, was HKD 660.6 million, a decrease from HKD 705.8 million as of December 31, 2022[100]. - As of June 30, 2023, the group's bank financing amounted to HKD 1,034.1 million, with other financial assets of HKD 313.6 million and cash of HKD 185.2 million held in various banks[84]. - The company is focusing on cash management activities based on overall treasury objectives and policies, concentrating investments in liquid investment instruments and fixed income products[79]. - The company raised approximately HKD 463.5 million from the subscription of 90,000,000 new ordinary shares at HKD 5.15 per share, resulting in a net amount of approximately HKD 453.2 million[82]. Governance and Compliance - The company has maintained compliance with the listing rules of the Hong Kong Stock Exchange during the reporting period[193]. - The company did not comply with certain corporate governance code provisions due to specific reasons outlined in the report[194]. - The company has a balanced and effective board governance structure as of the reporting date[195].

Share Incentive Plan - The total number of shares available for issuance under the share incentive plan is 91,598,574, accounting for approximately 9.92% of the company's issued shares as of the reporting date[14]. - The maximum allocation for each participant under the share incentive plan is capped at 10% of the total number of shares issued as of the adoption date, which is 91,598,574 shares[22]. - The share incentive plan is valid for 10 years from the adoption date, which is from March 31, 2021, to March 30, 2031[27]. - If the allocation exceeds 1% of the total issued shares, the company must publish a circular and obtain shareholder approval at a general meeting[15]. - The plan aims to align the interests of selected participants with those of the company's shareholders to drive future development and expansion[20]. - No share rewards have been granted under the share incentive plan since its adoption date[9]. - The board may determine the vesting conditions and periods for the rewards at any time during the plan's effectiveness[24]. - The total number of options granted to participants under the plan and any other share option plans cannot exceed 1% of the total issued shares during any 12-month period[23]. - The plan does not have a purchase price for the rewards[26]. Company Developments - The company has not disclosed any new products, technologies, market expansions, or acquisitions in this announcement[25].

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Financial Performance - Total gross merchandise value for the six months ended June 30, 2022, reached HKD 4,186 million, a 37.7% increase from HKD 3,040 million in the same period last year[10]. - Revenue for the period was HKD 1,922 million, a 26.6% increase from HKD 1,518 million year-on-year[12]. - The net profit for the period was HKD 127.8 million, a 33.4% increase from HKD 95.8 million last year[12]. - Adjusted EBITDA for the period was HKD 195.6 million, up 35.4% from HKD 144.4 million in the previous year[12]. - Total gross merchandise transaction value for HKTVmall in the first half of 2022 reached HKD 4.14 billion, a 36.8% increase from HKD 3.03 billion in the same period of 2021[22]. - The group achieved a net profit of HKD 127.8 million in the first half of 2022, compared to HKD 95.8 million in the same period of 2021, representing a year-on-year increase of approximately 33.4%[47]. - Revenue for the six months ended June 30, 2022, reached HKD 1,922,144,000, an increase of 26.6% compared to HKD 1,518,127,000 for the same period in 2021[81]. - The company reported a pre-tax profit of 127,849,000 HKD for the six months ended June 30, 2022, compared to 95,826,000 HKD for the same period in 2021, representing a growth of approximately 33.5%[107]. Customer Engagement - The average daily order volume increased to 49,100, up 36.0% from 36,100 in the previous year[10]. - The number of merged independent customers rose to 1,107,000, reflecting a growth of 23.5% compared to 896,000 last year[10]. - The average purchase frequency per customer in Q2 2022 was 5.05 times, compared to 4.61 times in Q4 2021, indicating increased customer engagement[18]. - The average number of main product categories purchased per customer in Q2 2022 was 2.97, up from 2.91 in Q4 2021, showing a diversification in purchasing behavior[18]. - The contribution of grocery products to total completed order transaction value in the first half of 2022 was 49.8%, continuing to drive customer traffic and repeat purchases[21]. - HKTVmall's monthly user traffic remained at approximately 1.5 million independent users, indicating stable user engagement[21]. Market Position and Strategy - HKTVmall aims to achieve a total merchandise transaction value target of HKD 8 billion for the year[4]. - The retail market in Hong Kong was valued at over HKD 350 billion in 2021, with HKTVmall's transaction value accounting for less than 2% of the market[6]. - HKTVmall plans to increase its market share to 4-5% of the Hong Kong retail market in the coming years[6]. - The company aims to assist merchants in establishing independent online stores, leveraging its customer base to enhance their e-commerce success[8]. - The company plans to continue investing in technology and logistics to strengthen its market position in Hong Kong's e-commerce sector[35]. Logistics and Infrastructure - The company is investing billions in logistics infrastructure to enhance delivery capabilities and reduce operational costs[7]. - Two third-party logistics centers are being expanded to provide warehousing and order fulfillment services, aiming to cover 85% of the best-selling products on HKTVmall[7]. - The logistics services will operate 364 days a year, with a goal of achieving same-day delivery for customers[7]. - HKTV has expanded its rapid delivery service to the less competitive wet market segment, offering over 500 products at the same prices as physical markets, with services launched in five markets[34]. - The delivery cost ratio for completed orders was recorded at 11.2% in Q1 2022, slightly increasing to 11.6% in Q2 2022, with expectations of a minor rise due to a new long-term lease for an automated delivery center starting in Q4 2022[29]. Advertising and Revenue Streams - Multimedia advertising revenue increased by HKD 16.8 million to HKD 64.8 million, representing a growth of 35.0% year-on-year, with a target of HKD 120 million for the full year of 2022[24]. - The company plans to increase advertising prices by up to 40% for popular formats in 2023, reflecting strong demand for its digital advertising services[67]. - The increase in multimedia advertising revenue was 35% year-over-year, rising to HKD 64,787,000 from HKD 48,061,000[81]. Capital Expenditures and Investments - Capital expenditures surged by 329.4% to HKD 214.1 million from HKD 49.9 million in the previous year[12]. - The company plans to invest approximately HKD 100 million in capital expenditures for a new automated logistics center, expected to be operational by the end of the first half of 2023[66]. - The company made payments of HKD 197,335,000 for the purchase of property, plant, and equipment during the reporting period, compared to HKD 79,993,000 in the same period last year, indicating a significant increase in capital expenditures[75]. Shareholder Information and Corporate Governance - The company declared an interim dividend of 8 HKD cents per share, totaling 73,729,000 HKD, slightly up from 73,306,000 HKD in the previous year[105]. - The company has complied with the corporate governance code as per the listing rules for the six months ending June 30, 2022[148]. - The audit committee, consisting of three independent non-executive directors, reviewed and discussed the unaudited interim results for the six months ending June 30, 2022[151].