Company Overview - New Feng Group (01223.HK) reported a closing price of HKD 1.03 per share, with a significant increase of 9.57% and a trading volume of 51.54 million shares, resulting in a turnover of HKD 39.53 million and a price fluctuation of 15.96% [1] - The company has achieved a total revenue of HKD 285 million for the year ending December 31, 2024, reflecting a year-on-year growth of 0.93%. However, it reported a net loss attributable to shareholders of HKD 133 million, which is an improvement with a year-on-year increase of 30.5%. The gross profit margin stands at 91.44%, and the debt-to-asset ratio is 47.49% [2] Industry Analysis - The professional retail industry has an average price-to-earnings (P/E) ratio of -4.52 times, with a median of -0.19 times. New Feng Group's P/E ratio is -19.53 times, ranking it 49th in the industry. Comparatively, other companies in the sector have P/E ratios ranging from 5.88 times to 7.13 times [3] - New Feng Group operates as a comprehensive enterprise involved in branding, retail, and financial services, holding a quality property portfolio primarily consisting of shopping malls and office buildings. The shopping malls adopt an 'Outlet + Community' model, strategically located in areas with strong consumer spending power, while the office buildings are situated in prime commercial locations [3]

Brand Performance - The "尚柏奧萊" brand achieved significant growth, particularly in Shenyang and Xiamen, with a high double-digit increase in customer traffic year-on-year[6]. - The compression clothing brand "SKINS" is undergoing a strategic rebranding to enhance product innovation and strengthen partnerships in response to intense market competition[7]. - The health product business, SBT, is expanding its market presence in Southeast Asia and strengthening partnerships with leading e-commerce platforms in mainland China[7]. - The Japanese sake business is steadily developing, with production lines expected to be operational in the second half of 2023[7]. Financial Performance - The group's total revenue increased by approximately 0.9% to about HKD 307.6 million, compared to HKD 304.7 million in 2023[13]. - Gross profit for the year was approximately HKD 281.2 million, an increase of about HKD 5.6 million or approximately 2.0% from HKD 275.6 million in the comparable year, resulting in a gross margin of approximately 91.4%[13]. - The loss attributable to the company's owners for the year was approximately HKD 143.1 million, a decrease of about 30.5% or approximately HKD 62.8 million compared to a loss of HKD 205.9 million in the comparable year[13]. - The retail segment reported revenue of approximately HKD 236.6 million, an increase of about 5.7% from HKD 223.9 million in 2023, with a reported segment loss of approximately HKD 21.8 million, down from HKD 81.4 million[16]. - Other income and gains increased by approximately 42.6% to about HKD 37.9 million from HKD 26.6 million in the comparable year, primarily due to a one-time government subsidy related to the Japanese sake business[19]. Cost Management - Distribution and selling expenses decreased by approximately 22.1% to about HKD 61.1 million from HKD 78.4 million in the comparable year, due to strict control over advertising and promotional expenses[20]. - Administrative expenses decreased by approximately 9.6% to about HKD 133.8 million from HKD 148.1 million in the comparable year, attributed to cost control measures[21]. Market Outlook - The company plans to leverage the "提振消費專項行動方案" policy to activate market potential and enhance promotional activities throughout the year[10]. - The company is cautiously optimistic about future growth, focusing on enhancing product competitiveness and user experience across its brands[10]. - The overall economic environment remains uncertain, but the company is confident in the support from the mainland government's policies to drive long-term growth[9]. Corporate Governance - The company has a strong management team with extensive experience in finance and business operations[54][55][58][59]. - The board of directors includes independent non-executive members with significant industry experience[51][52][58]. - The company is committed to corporate governance and compliance, as evidenced by the qualifications of its company secretary[60]. - The company has adopted a board diversity policy to enhance efficiency and corporate governance, considering various factors such as age, culture, and professional experience[134]. - The board has delegated daily management and operational responsibilities to the Chief Operating Officer and senior management, with significant autonomy granted[135]. Shareholder Information - The proposed final dividend for the year is HKD 0.005 per share, totaling approximately HKD 14,871,000, consistent with the previous year[65]. - The company's distributable reserves as of December 31, 2024, amount to HKD 1,319,805,000, down from HKD 1,412,536,000 in 2023[77]. - The company has not purchased, sold, or redeemed any of its listed securities during the year[79]. - The proposed final dividend is subject to approval at the annual general meeting scheduled for June 20, 2025[65]. Risk Management - Financial risks such as foreign currency risk, interest rate risk, credit risk, liquidity risk, and equity price risk are discussed in detail[64]. - The company emphasizes transparency, accountability, and effective risk management as key components of good corporate governance[128]. - The company has measures in place to mitigate potential money laundering risks associated with borrowers[170]. Employee and Management Information - Total employee count as of December 31, 2024, was 217, up from 206 in 2023, with employee costs (excluding director remuneration) around HKD 53.9 million, down from HKD 64.4 million in 2023[37]. - The company encourages continuous professional development for directors to keep them updated on business, legal, and regulatory changes[137]. - The company has arranged appropriate directors' and officers' liability insurance for its directors and senior management[96]. Sustainability and ESG - The company promotes environmental sustainability through initiatives such as water conservation and energy-saving practices in the office[176]. - The scope of the ESG report has expanded to include the healthcare business of ZhanTu Biotechnology, reflecting significant economic, environmental, and social impacts during the reporting period[185]. - The company conducted a stakeholder importance assessment to identify key sustainability issues through an independent third-party consultant and online surveys[200]. Strategic Acquisitions - The acquisition of 15% equity in a non-wholly owned subsidiary was agreed for USD 0.6 million (approximately HKD 4.7 million), expected to be completed by February 28, 2025[40]. - The acquisition is anticipated to enhance operational management efficiency and broaden revenue sources for the group, with significant revenue growth expected for the acquired subsidiary in the coming years[43].

Financial Performance - The group's total revenue increased from approximately HKD 304.7 million in the comparable year to about HKD 307.6 million in the current year[4]. - EBITDA for the current year was approximately HKD 45.6 million, compared to a loss of about HKD 16.5 million in the comparable year, indicating a turnaround to profit[4]. - The annual loss attributable to the company's owners decreased by approximately 30.5% to about HKD 143.1 million, down from HKD 205.9 million in 2023[4]. - Gross profit for the current year was HKD 281.2 million, compared to HKD 275.6 million in the previous year, reflecting a slight increase[5]. - Total comprehensive loss for the year amounted to HKD 205.5 million, compared to HKD 257.6 million in the previous year[6]. - The company reported a basic loss per share of HKD 4.81, compared to HKD 6.92 in the previous year[5]. - The group recorded a loss attributable to shareholders of approximately HKD 143.1 million, a reduction of about 30.5% or HKD 62.8 million compared to a loss of HKD 205.9 million in the comparable year[70]. Dividends and Shareholder Returns - The board recommended a final dividend of HKD 0.005 per ordinary share, unchanged from 2023[4]. - The company declared a final dividend of HKD 0.005 per ordinary share for the fiscal year ending December 31, 2024, consistent with the previous year[56]. - The annual general meeting is scheduled for June 20, 2025, during which shareholders will vote on the proposed dividend[96]. Assets and Liabilities - Non-current assets totaled HKD 3.14 billion, down from HKD 3.33 billion in 2023[7]. - Current assets decreased from HKD 1.55 billion in 2023 to HKD 1.27 billion in the current year[7]. - Current liabilities decreased from HKD 1,259,086,000 in 2023 to HKD 1,162,630,000 in 2024, a reduction of approximately 7.7%[8]. - Total non-current liabilities decreased from HKD 1,083,056,000 in 2023 to HKD 934,370,000 in 2024, representing a decline of about 13.8%[8]. - Net assets decreased from HKD 2,539,298,000 in 2023 to HKD 2,318,961,000 in 2024, reflecting a decline of about 8.7%[8]. - The company's equity attributable to owners decreased from HKD 2,531,009,000 in 2023 to HKD 2,313,016,000 in 2024, a reduction of approximately 8.6%[8]. Revenue Segmentation - Total revenue from external customers reached HKD 307,561,000, with retail contributing HKD 242,076,000[32]. - The company reported a total segment loss of HKD 65,376,000, with the retail segment loss at HKD 21,770,000[32]. - Franchise sales generated total revenue of HKD 1,074,392,000, with commission income from franchise sales amounting to HKD 178,794,000[33]. - Segment income from brand promotion was HKD 53,089,000, while financial services contributed HKD 17,915,000[32]. - The company reported a total of HKD 68,803,000 in revenue from other sources outside HKFRS 15, primarily from rental income and interest income[36]. Operational Efficiency - The company's operating expenses decreased to HKD 1,101,000 in 2024 from HKD 3,469,000 in 2023[54]. - Distribution and selling expenses decreased from approximately HKD 78.4 million in the comparable year to about HKD 61.1 million, a reduction of approximately 22.1% due to strict control over advertising and promotional expenses[76]. - Administrative expenses decreased from approximately HKD 148.1 million in the comparable year to about HKD 133.8 million, a reduction of approximately 9.6% due to cost control measures implemented during the year[77]. Market and Economic Conditions - The macroeconomic environment faced challenges, including a restructuring of the real estate market and weak consumer demand, impacting economic growth[66]. - The company maintained a diversified business layout and actively sought changes to ensure stable business development despite external challenges[66]. Future Outlook and Strategic Initiatives - The company remains cautiously optimistic about future development, supported by proactive government policies aimed at enhancing domestic demand and market confidence[99]. - In retail, the company aims to leverage the government's consumption stimulus policies to activate market potential and enhance customer experience through data analytics and AI[100]. - The brand business will focus on optimizing resources in key markets and enhancing product competitiveness and customer experience[101]. Corporate Governance and Compliance - The audit committee, consisting of three independent non-executive directors, has reviewed the annual performance[103]. - The financial statements have been reviewed by the company's auditor, but no audit assurance has been provided[104]. - The company has adhered to the corporate governance code and has confirmed compliance with the standards for securities trading by directors[110]. Acquisitions and Investments - The company has agreed to acquire 15% of the shares of New Ito Group for a price of $600,000, equivalent to approximately HKD 4,680,000[106]. - Following the acquisition, the company will hold 100% ownership of New Ito, enhancing operational management efficiency[107]. - The acquisition is expected to provide more business opportunities and broaden revenue sources for the company in the long term[108].

Financial Performance - The overall revenue for the first half of 2024 decreased by approximately 1.9% to about HKD 150.3 million, compared to HKD 153.2 million in the corresponding period of 2023[11] - The company recorded an unaudited consolidated loss attributable to owners of approximately HKD 28.4 million, an improvement from a loss of HKD 87.6 million in the corresponding period[11] - The retail segment's revenue increased by approximately 1.7% to about HKD 118.2 million, compared to HKD 116.2 million in the previous period, with a reported segment profit of approximately HKD 13.4 million[13] - The brand promotion segment's revenue decreased by approximately 14.5% to about HKD 23.2 million, with a reported segment loss of approximately HKD 0.8 million[12] - The financial services segment's revenue decreased by approximately 9.4% to about HKD 8.9 million, with a reported segment loss of approximately HKD 0.4 million[14] - The group recorded a loss attributable to the company's owners of approximately HKD 28.4 million, down from a loss of approximately HKD 87.6 million, primarily due to increased other income and cost control measures[19] - Gross profit for the same period was HKD 140,502, down from HKD 143,072, reflecting a decline of 1.8%[47] - The company reported a loss before tax of HKD 23,109, a substantial improvement from a loss of HKD 93,259 in the previous year, representing a decrease in losses of 75.2%[47] - The net loss for the period was HKD 26,681, significantly reduced from HKD 91,066, indicating a 70.7% improvement[49] - Total comprehensive loss for the period amounted to HKD 82,275, compared to HKD 195,883 in the previous year, reflecting a decrease of 58.0%[49] Revenue Sources - Revenue from China, Hong Kong, and other Asian countries accounted for approximately 94.7% of total revenue, compared to 94.4% in the corresponding period[20] - Total revenue from external customers reached HKD 150,324,000, with retail contributing HKD 118,174,000, representing a significant portion of the total[73] - Revenue from the Greater China region amounted to HKD 91,176,000, while Hong Kong contributed HKD 13,995,000[79] - The company reported a total of HKD 34,257,000 in revenue from other sources, including rental income and interest income[82] - The financial services segment generated HKD 9,844,000 in revenue, with a loss of HKD 9,584,000 reported[75] Cost Management - Distribution and selling expenses decreased from approximately HKD 38.0 million to about HKD 26.8 million, a reduction of approximately 29.5%[16] - Administrative expenses decreased from approximately HKD 75.0 million to about HKD 64.8 million, a reduction of approximately 13.6%[17] - The company incurred central administrative expenses of HKD 41,974,000, impacting overall profitability[75] Cash Flow and Liquidity - As of June 30, 2024, the group's bank balance and cash were approximately HKD 55.8 million, down from HKD 132.6 million as of December 31, 2023[21] - The current ratio as of June 30, 2024, was approximately 1.01, down from 1.23 as of December 31, 2023[23] - The cash generated from operating activities was HKD 75,687 thousand for the six months ended June 30, 2024, up from HKD 46,618 thousand in the same period of 2023, reflecting improved operational efficiency[58] - The company’s cash flow before changes in working capital was HKD 72,014 thousand for the six months ended June 30, 2024, compared to HKD 43,209 thousand for the same period in 2023, reflecting improved cash flow management[58] - Cash and cash equivalents decreased by HKD 75,849 thousand for the six months ended June 30, 2024, compared to a decrease of HKD 32,310 thousand for the same period in 2023[20] Assets and Liabilities - Non-current assets decreased to HKD 3,182,602 from HKD 3,333,544, a decline of 4.5%[51] - Current liabilities increased to HKD 1,459,724 from HKD 1,259,086, representing an increase of 15.9%[52] - The company's total assets less current liabilities stood at HKD 3,199,151, down from HKD 3,622,354, a decrease of 11.7%[52] - The total reported segment assets decreased from HKD 3,828,308 to HKD 3,635,910, reflecting a decline of approximately 5.0%[89] - Total liabilities as of June 30, 2024, were HKD 2,216,723, down from HKD 2,342,142 as of December 31, 2023, indicating a reduction of about 5.4%[91] Shareholder Information - As of June 30, 2024, Mr. Zheng holds 167,040,000 shares, representing approximately 43.58% of the total issued share capital of 1,296,230,000 shares[33] - Goldsilk Capital Limited, wholly owned by Mr. Zheng, directly holds 1,129,190,000 shares, accounting for approximately 37.97% of the total[36] - Mr. Ko holds 350,000,000 shares directly and has joint ownership of 120,000,000 shares with Ms. Wong, totaling 470,000,000 shares, which is approximately 15.80%[37] - The company did not purchase, sell, or redeem any of its listed securities during the reporting period[37] - The issued and fully paid ordinary shares remained at 2,974,225,000 shares as of June 30, 2024, unchanged from December 31, 2023[130] Corporate Governance - The company has complied with the corporate governance code, except for the separation of the roles of Chairman and CEO, which are held by Mr. Zheng[42] - The company is in the process of appointing a new independent non-executive director to comply with corporate governance requirements[43] - The audit committee, consisting of three independent non-executive directors, reviewed the group's accounting policies and financial reporting matters[45] Future Outlook - The company is cautiously optimistic about future development, focusing on enhancing core competitiveness and capturing market opportunities[30] - The company is actively exploring market opportunities for its Japanese sake brand, leveraging exhibitions and social media promotions[8] - The company is focusing on expanding its market presence in the Greater China region, which is expected to drive future revenue growth[79] Investments and Acquisitions - The group has no significant acquisitions, disposals, or major investment plans during the period[30] - The company has established two special purpose acquisition companies (SPACs) to raise significant capital for potential business acquisitions, although the second SPAC has not yet been formed[148] Miscellaneous - The company did not recognize any impairment provisions for margin clients during the period, as there were no significant defaults reported[114] - The company has not adopted any new accounting standards that would have a significant impact on its financial performance or position during the reporting period[67]

Financial Performance - Revenue for the six months ended June 30, 2024, was approximately HKD 150.3 million, compared to HKD 153.2 million for the corresponding period[2]. - Loss for the period was approximately HKD 26.7 million, significantly improved from a loss of HKD 91.1 million in the corresponding period[2]. - Loss attributable to owners of the company for the period was approximately HKD 28.4 million, compared to HKD 87.6 million for the corresponding period[2]. - Basic loss per share for the period was approximately HKD 0.95, an improvement from HKD 2.94 in the corresponding period[2]. - Total comprehensive loss for the period amounted to HKD 82.3 million, compared to HKD 195.9 million for the corresponding period[4]. - The group recorded a consolidated loss attributable to shareholders of approximately HKD 28.4 million for the period, compared to a loss of approximately HKD 87.6 million in the corresponding period[47]. - The company reported a pre-tax loss of HKD 23,109,000 for the six months ended June 30, 2024, compared to a pre-tax loss of HKD 93,259,000 for the same period in 2023[15][17]. - The basic and diluted loss per share for the six months ended June 30, 2024, was HKD (0.95), compared to HKD (2.94) for the same period in 2023, reflecting a reduction in losses[35]. Revenue Breakdown - For the six months ended June 30, 2024, the total revenue from external customers was HKD 150,324,000, with contributions from brand promotion (HKD 23,234,000), retail (HKD 118,174,000), and financial services (HKD 8,916,000) [15]. - The brand promotion segment's revenue was approximately HKD 23.2 million, a decrease of about 14.5% from HKD 27.2 million in the corresponding period[48]. - Retail segment revenue for the period was approximately HKD 118.2 million, an increase of about 1.7% compared to the previous period's HKD 116.2 million[50]. - Financial services segment revenue decreased to approximately HKD 8.9 million, down about 9.4% from HKD 9.8 million in the corresponding period[51]. - For the six months ended June 30, 2023, total revenue from external customers was HKD 153,225,000, with brand promotion contributing HKD 27,183,000, retail HKD 116,198,000, and financial services HKD 9,844,000[17]. Assets and Liabilities - Non-current assets as of June 30, 2024, totaled approximately HKD 3,182.6 million, down from HKD 3,333.5 million as of December 31, 2023[5]. - Current assets as of June 30, 2024, were approximately HKD 1,476.3 million, compared to HKD 1,547.9 million as of December 31, 2023[5]. - As of June 30, 2024, current liabilities totaled HKD 1,459,724,000, an increase of 15.9% from HKD 1,259,086,000 as of December 31, 2023[6]. - The total value of current assets decreased significantly to HKD 16,549,000 from HKD 288,810,000, indicating a decline of 94.2%[6]. - Non-current liabilities amounted to HKD 756,999,000, down from HKD 1,083,056,000, representing a decrease of 30.1%[6]. - The total equity value as of June 30, 2024, was HKD 2,442,152,000, a decrease of 3.8% from HKD 2,539,298,000 at the end of 2023[6]. - The company reported a decrease in total assets from HKD 4,881,440,000 in December 2023 to HKD 4,658,875,000 in June 2024[23]. - The total liabilities decreased from HKD 2,342,142,000 in December 2023 to HKD 2,216,723,000 in June 2024[24]. Expenses and Income - The company reported a decrease in administrative expenses to approximately HKD 64.8 million from HKD 75.0 million in the corresponding period[3]. - Distribution and selling expenses decreased to approximately HKD 26.8 million, down about 29.5% from HKD 38.0 million in the previous period[54]. - Other income and gains for the period were approximately HKD 25.0 million, compared to HKD 15.3 million for the corresponding period[3]. - Other income increased significantly to HKD 25,009,000 in the first half of 2024, compared to HKD 15,262,000 in the same period of 2023[25]. - Interest income for the first half of 2024 was HKD 2,326,000, down from HKD 3,835,000 in the previous year[26]. Business Operations - The company is engaged in brand promotion, retail management, and financial services, indicating a diversified business model[7]. - The company plans to continue its market expansion and product development strategies in the upcoming periods[7]. - The online promotion and big data operations showed significant results, with WeChat follower numbers and online membership cards recording double-digit growth year-on-year[44]. - The group operates the "SKINS" brand in collaboration with Itochu Corporation, focusing on optimizing marketing strategies and expanding partnerships[45]. - The health product business will continue to focus on Hong Kong while looking for global opportunities[69]. Future Outlook - The company believes that the economic strength of the country remains solid and the long-term positive trend is unchanged[69]. - The company is cautiously optimistic about future development and aims for long-term healthy growth[69]. - The company plans to enhance its core competitiveness across various businesses, focusing on retail and brand operations[69]. Compliance and Governance - The company has adopted new accounting standards effective January 1, 2024, which may impact future financial reporting[9]. - The company has not reported any significant impact from the newly adopted accounting standards on its financial performance[11]. - The company has adopted the standard code for directors' securities trading and confirmed compliance during the period[72]. - The audit committee has reviewed the accounting policies and practices adopted by the company[73]. Employee and Dividend Information - The total number of employees as of June 30, 2024, was 265, a decrease from 301 employees as of June 30, 2023[65]. - The company did not declare any interim dividend for the period, consistent with the corresponding period[2]. - The company did not recommend the payment of an interim dividend for the six months ended June 30, 2024, maintaining the dividend at HKD 0.005 per share for the fiscal year ending December 31, 2023[34].

Financial Performance - The overall revenue for the year increased by approximately 9.2% to about HKD 304.7 million, compared to HKD 279.2 million in 2022[13] - Gross profit for the year was approximately HKD 275.6 million, an increase of about HKD 23.9 million or approximately 9.5% from HKD 251.7 million in the previous year, with a gross profit margin of about 90.4%[13] - The company recorded a loss attributable to shareholders of approximately HKD 205.9 million, a significant increase of about 153.3% compared to a loss of HKD 81.3 million in the previous year[13] - Reported segment loss for the retail division was approximately HKD 81.4 million, compared to a loss of HKD 49.1 million in 2022, primarily due to a decrease in the fair value of investment properties[14] - Financial services segment revenue decreased to approximately HKD 19.8 million, down from HKD 21.9 million in 2022[16] - Reported segment loss for financial services increased to approximately HKD 22.0 million from HKD 10.3 million in 2022, mainly due to fair value losses on financial assets[16] - Other income and gains decreased significantly to approximately HKD 26.6 million from HKD 174.1 million in the previous year, a reduction of about 84.7% due to the absence of one-time gains from the sale of the "PONY" business[17] - Financing costs rose to approximately HKD 104.0 million, an increase of about 39.0% from HKD 74.8 million in 2022, attributed to rising Hong Kong interbank offered rates[20] - The fair value loss of investment properties was approximately HKD 65.0 million, compared to a loss of HKD 7.0 million in the previous year, due to a weak commercial property market in China and Hong Kong[22] - The net loss attributable to the owners of the company was approximately HKD 205.9 million, compared to a loss of HKD 81.3 million in 2022, driven by fair value losses and increased financing costs[25] Business Segments - Membership numbers for the "尚柏奧萊" retail business increased by over 50%, with member spending contributing to more than half of total consumption[9] - The brand promotion segment, which includes the "SKINS" trademark and health products, generated revenue of approximately HKD 61.1 million, a 2.0% increase from HKD 59.9 million in 2022[13] - The community mall business maintained stable performance, contributing to consistent revenue through a "one-stop shopping" experience for local residents[9] - Retail segment revenue increased to approximately HKD 223.9 million, up 13.4% from HKD 197.3 million in 2022[14] - The main business segments include brand promotion, retail, and financial services, with a focus on developing the "SKINS" brand and managing properties[45] Strategic Initiatives - The company plans to continue its pragmatic approach to future planning, aiming to create maximum value for stakeholders[12] - The company plans to enhance its brand strategy by introducing more international young fashion brands and optimizing hardware facilities for a better shopping experience[35] - The company aims to control costs and improve operational efficiency in its compression clothing business while launching new products to enhance brand image[35] - The health supplement business will expand its product line and increase promotions targeting specific demographics, seeking domestic and international partnerships[35] - The company anticipates challenges in the external environment, including a weak property market and pressure on consumer price indices, but remains confident in the resilience of the national economy[35] Governance and Compliance - The company is committed to good corporate governance through transparency, independence, and accountability, continuously reviewing and updating governance mechanisms[91] - The company has adopted the corporate governance code as per the listing rules, but there are deviations regarding the roles of the Chairman and CEO, which are held by the same individual, Mr. Zheng Dunni[92] - All independent non-executive directors have served on the board for over nine years, and the company plans to appoint a new independent non-executive director by January 1, 2023, to comply with governance standards[92] - The board currently consists of six members, including three executive directors and three independent non-executive directors, ensuring a balance of skills and experience relevant to the company's business needs[95] - The board has established a diversity policy aimed at enhancing efficiency and governance, considering factors such as age, cultural background, and professional experience[96] Risk Management - Financial risks such as foreign currency risk, interest rate risk, credit risk, liquidity risk, and equity price risk are discussed in detail in the management analysis section[46] - The company has established procedures to identify and manage risks that may adversely affect its business operations, ensuring compliance with relevant laws and regulations[120] - The risk management strategy includes continuous strengthening of internal controls and risk management systems based on risk assessment results[117] - The company conducts regular monitoring and reporting of risks to ensure the effectiveness of internal control procedures[118] Employee Engagement and Welfare - The company emphasizes employee engagement through regular communication channels, including a WeChat group for suggestions and a bulletin board for internal communications[185] - Employee benefits include annual leave, medical insurance, and various allowances such as meal and transportation subsidies[183] - The group conducted over 4,790 hours of training during the reporting period, significantly up from over 1,500 hours in 2022, with an average training time of 19.02 hours per employee compared to 6.42 hours in 2022[187] - The employee turnover rate for the reporting period was 22%, down from 28% in 2022[179] - The company offers competitive salaries and benefits to attract and retain talent, conducting regular salary reviews to ensure market competitiveness[182] Environmental and Social Responsibility - The company emphasizes its commitment to environmental policies and performance, detailed in the ESG report section[46] - The group has set up a green procurement guideline to promote sustainable operations by prioritizing suppliers that use environmentally friendly or recycled materials[176] - The environmental goals include reducing energy and water consumption, as well as minimizing greenhouse gas emissions and waste production, with regular reviews by the ESG working group[195] - The group collaborates with 344 domestic suppliers to reduce greenhouse gas emissions from logistics and transportation[176] Shareholder Communication - The company emphasizes the importance of maintaining two-way communication with stakeholders through its shareholder communication policy, ensuring transparency and timely information dissemination[129] - The company maintains sufficient public float throughout the year and up to the date of the report[78] - The proposed final dividend for the year is HKD 0.005 per share, totaling approximately HKD 14,871,000, consistent with the previous year[47]

Financial Performance - Total revenue for the year ended December 31, 2023, was HKD 304,725,000, an increase of 9.2% compared to HKD 279,153,000 in 2022[2] - Gross profit for the year was HKD 275,597,000, up from HKD 251,669,000, reflecting a gross margin improvement[2] - The company reported a loss from continuing operations of HKD 213,966,000, compared to a loss of HKD 92,718,000 in the previous year, indicating a significant increase in losses[2] - The basic and diluted loss per share from continuing operations was HKD 6.92, compared to HKD 2.87 in 2022[3] - The total comprehensive loss for the year was HKD 257,619,000, compared to a total comprehensive loss of HKD 290,076,000 in 2022[5] - The company reported a significant increase in trade and other payables, rising to HKD 337,100,000 in 2023 from HKD 266,772,000 in 2022, an increase of 26.2%[7] - The company reported a loss attributable to shareholders of HKD 205,913,000 for the year 2023, compared to a loss of HKD 81,278,000 in 2022, reflecting a significant increase in losses[65] - The basic and diluted loss per share for 2023 was HKD (6.92), compared to HKD (2.73) in 2022, indicating a worsening financial performance[65] Assets and Liabilities - Total non-current assets decreased to HKD 3,333,544,000 from HKD 4,053,461,000, primarily due to a reduction in investment properties[6] - Current assets increased to HKD 1,547,896,000 from HKD 1,084,626,000, with significant growth in assets classified as held for sale[6] - Current liabilities increased to HKD 1,259,086,000 in 2023 from HKD 880,815,000 in 2022, representing a growth of 42.9%[7] - Total assets less current liabilities decreased to HKD 3,622,354,000 in 2023 from HKD 4,257,272,000 in 2022, a decline of 14.9%[7] - Non-current liabilities decreased to HKD 1,083,056,000 in 2023 from HKD 1,411,678,000 in 2022, a reduction of 23.2%[7] - Total equity decreased to HKD 2,539,298,000 in 2023 from HKD 2,845,594,000 in 2022, a decrease of 10.7%[7] Revenue Segments - The total revenue from the retail segment's franchise sales amounted to HKD 1,068,280, with commission income from franchise sales at HKD 166,513[26] - The brand promotion segment generated revenue of HKD 61,123, while the retail segment generated HKD 229,291, and the financial services segment generated HKD 19,752[28] - The customer contract revenue under HKFRS 15 for the year ending December 31, 2023, totaled HKD 232,178, with significant contributions from the retail segment[32] - The revenue from other sources outside HKFRS 15 amounted to HKD 72,547, primarily driven by rental income and interest income[33] - The financial services segment reported a loss of HKD (22,008) for the year ending December 31, 2023[28] - Revenue from China was HKD 225,013,000, up 12.5% from HKD 199,976,000 in 2022[42] - Revenue from Hong Kong increased to HKD 51,311,000, a rise of 21.1% compared to HKD 42,406,000 in 2022[42] Operational Strategy and Market Focus - The company has plans for market expansion and new product development, although specific details were not disclosed in the earnings report[1] - The company plans to continue expanding its market presence, particularly in the Chinese market, which remains a key focus for future growth[34] - The company adjusted its operational strategy to actively seek partnerships for healthy brand development in a competitive global market[78] - The company aims to control costs and improve operational efficiency in its apparel business while launching more new products[106] Accounting Policies and Standards - The company has adopted new Hong Kong Financial Reporting Standards effective from January 1, 2023, with no significant impact on the financial performance or disclosures[11] - The new Hong Kong Financial Reporting Standard 17 for insurance contracts establishes principles for recognition, measurement, presentation, and disclosure, replacing HKFRS 4, but will not impact the group's consolidated financial statements[12] - The amendments to HKAS 1 regarding accounting policy disclosures replace "significant accounting policies" with "significant accounting policy information," which may influence major users' decisions based on financial statements[12] - The amendments to HKAS 8 clarify the distinction between changes in accounting policies and changes in accounting estimates, with no impact on the group's consolidated financial statements[15] - The amendments to HKAS 12 regarding deferred tax related to single transactions clarify that companies must recognize deferred tax for certain transactions, with no significant impact on the group's consolidated financial statements[15] Employee and Operational Costs - Employee costs (excluding directors' fees) decreased to 71,592 thousand HKD in 2023 from 75,868 thousand HKD in 2022, a reduction of about 5%[57] - The total number of employees increased to 206 from 193 in the previous year, with employee costs amounting to approximately HKD 64.4 million[99] Financing and Cash Flow - Bank loans increased to HKD 813,760,000 in 2023 from HKD 549,790,000 in 2022, reflecting a rise of 47.9%[7] - Interest expenses for bank loans increased to HKD 89,076,000, a rise of 45.0% from HKD 61,426,000 in 2022[47] - The total financing costs for 2023 amounted to HKD 104,000,000, compared to HKD 74,831,000 in 2022, reflecting a 38.8% increase[47] - The company reported a net cash outflow from financing activities of HKD (3,690,000) in 2023, indicating challenges in raising capital[65] Miscellaneous - The company declared a final dividend of HKD 0.005 per ordinary share for the fiscal year ending December 31, 2023, consistent with the previous year's dividend[63] - The company has no outstanding stock options as of the announcement date[100] - The company is in the process of appointing a new independent non-executive director to comply with corporate governance codes[110] - The audit committee has reviewed the company's performance for the year[108]

Financial Performance - The group's overall revenue increased by 13.2% to approximately HKD 153.2 million, compared to HKD 135.4 million in the corresponding period[12]. - The company recorded an unaudited consolidated loss attributable to shareholders of approximately HKD 87.6 million, a significant increase of about 2,820.0% from the loss of approximately HKD 3.0 million in the corresponding period[12]. - Revenue for the six months ended June 30, 2023, was HKD 153,225 thousand, an increase of 13.1% compared to HKD 135,383 thousand for the same period in 2022[52]. - The total reported loss for the six months ended June 30, 2023, was HKD 52,230,000, compared to a profit of HKD 100,762,000 for the same period in 2022[86]. - The company reported a loss of HKD 91,066,000 for the six months ended June 30, 2023, compared to a loss of HKD 9,185,000 for the same period in 2022, indicating a significant increase in losses[56]. Revenue Segmentation - The retail segment's revenue rose by approximately 14.8% to about HKD 116.2 million, up from HKD 101.2 million in the previous period[13]. - The brand promotion segment's revenue increased by approximately 24.2% to about HKD 27.2 million, compared to HKD 21.9 million in the corresponding period[12]. - The financial services segment's revenue decreased by approximately 20.3% to about HKD 9.8 million, down from HKD 12.3 million in the previous period[14]. - The revenue from the brand promotion segment was HKD 27,197,000, while the retail segment generated HKD 118,039,000, and the financial services segment contributed HKD 9,844,000[86]. Cost Management - Sales cost decreased from approximately HKD 11.0 million to about HKD 10.2 million, a reduction of approximately 7.3%[15]. - Distribution and selling expenses decreased from approximately HKD 41.0 million to about HKD 38.0 million, a reduction of approximately 7.3%[18]. - Administrative expenses decreased from approximately HKD 80.6 million to about HKD 75.0 million, a reduction of approximately 7.0%[19]. - The company’s employee costs (excluding directors' remuneration) decreased to 33,950 thousand HKD in the first half of 2023 from 36,135 thousand HKD in the same period of 2022, showing a reduction of approximately 6.0%[108]. Profitability Metrics - Gross profit increased to approximately HKD 143.1 million, up about HKD 18.7 million or approximately 15.0% compared to the previous period[15]. - Gross margin improved to approximately 93.4%, compared to approximately 91.9% in the corresponding period[15]. - Basic and diluted loss per share from continuing operations was HKD 2.94, compared to HKD 0.24 for the same period in 2022[54]. - The company reported a significant foreign exchange loss of HKD 116,024,000 during the period, compared to a loss of HKD 141,673,000 in the previous period, showing an improvement of about 18.1%[63]. Cash Flow and Liquidity - As of June 30, 2023, the group's cash and bank balances were approximately HKD 69.9 million, down from approximately HKD 98.1 million as of December 31, 2022[23]. - The cash flow from operating activities generated a net cash inflow of HKD 46,618,000 for the six months ended June 30, 2023, down from HKD 124,698,000 in the previous year, indicating a decline of about 62.7%[65]. - The company’s cash and cash equivalents decreased to HKD 69,876,000 from HKD 98,131,000, reflecting a reduction of about 29.0%[57]. - The total cash and cash equivalents at the end of the period were HKD 69,876,000, down from HKD 283,718,000 at the end of the previous period[67]. Shareholder Information - As of June 30, 2023, Mr. Zheng holds 167,040,000 shares, representing approximately 41.63% of the issued share capital[34]. - Goldsilk Capital Limited, wholly owned by Mr. Zheng, directly holds 1,071,190,000 shares, accounting for 36.02% of the issued share capital[38]. - The company did not declare any interim dividend for the period[31]. - The company did not recommend an interim dividend for the six months ended June 30, 2023, maintaining the same dividend of HKD 0.005 per share for the previous year[120]. Corporate Governance and Compliance - The company has complied with the corporate governance code, except for the separation of roles between the Chairman and CEO[42]. - The audit committee reviewed the interim financial results and confirmed compliance with relevant accounting standards, ensuring transparency and accuracy in financial reporting[49]. Market and Economic Conditions - The macroeconomic environment remains uncertain, particularly regarding the real estate sector and consumer attitudes[32]. - The company is committed to seizing opportunities for long-term business development amid economic recovery[32]. Investments and Assets - The company made significant investments in property, plant, and equipment amounting to HKD 2,626,000, compared to HKD 579,000 in the same period last year[67]. - The company’s investment properties decreased to HKD 1,191,569,000 from HKD 1,241,285,000, a decrease of about 4.0%[57]. - The company’s total assets as of June 30, 2023, were reported at HKD 3,008,967,000, reflecting a decrease from HKD 3,170,271,000 at the beginning of the year, a decline of approximately 5.1%[63]. Financial Instruments and Valuation - The fair value of financial assets measured at fair value through profit or loss decreased to HKD 112,700,000 from HKD 124,015,000 year-on-year[142]. - The fair value measurement process involves regular consultations with the board regarding valuation processes and results[169]. - The company’s policy is to recognize changes in valuation techniques and transfers between fair value levels as they occur[167].

Financial Performance - Revenue for the six months ended June 30, 2023, was HKD 153,225,000, an increase of 13.2% compared to HKD 135,383,000 for the same period in 2022[2] - Gross profit for the same period was HKD 143,072,000, up from HKD 124,372,000, reflecting a gross margin improvement[2] - Loss from continuing operations for the six months ended June 30, 2023, was HKD 91,066,000, compared to a loss of HKD 12,942,000 in the prior year, indicating a significant increase in losses[2] - The basic and diluted loss per share from continuing operations was HKD 2.94, compared to HKD 0.10 for the same period in 2022[6] - Total comprehensive loss for the six months ended June 30, 2023, was HKD 195,883,000, compared to HKD 152,003,000 in the previous year[7] - The company reported a significant increase in bank loans, rising to HKD 611,758,000 from HKD 549,790,000, an increase of 11.1%[9] - The company reported a loss attributable to shareholders of HKD 87,573,000 for the six months ended June 30, 2023, compared to a loss of HKD 7,159,000 for the same period in 2022, representing an increase in loss of approximately 1,126%[47] - Basic and diluted loss per share for the six months ended June 30, 2023, was HKD (2.94), compared to HKD (0.24) for the same period in 2022, indicating a significant decline in performance[48] Assets and Liabilities - Non-current assets as of June 30, 2023, totaled HKD 3,854,562,000, a decrease from HKD 4,053,461,000 as of December 31, 2022[8] - Current assets amounted to HKD 1,041,157,000, down from HKD 1,084,626,000 at the end of 2022[8] - Current liabilities totaled HKD 973,843,000 as of June 30, 2023, an increase of 10.5% from HKD 880,815,000 in 2022[9] - Total assets minus current liabilities decreased to HKD 3,921,876,000 from HKD 4,257,272,000, reflecting a decline of 7.9%[9] - Non-current liabilities decreased to HKD 1,287,036,000 from HKD 1,411,678,000, a reduction of 8.8%[9] - Net assets decreased to HKD 2,634,840,000 from HKD 2,845,594,000, representing a decline of 7.4%[9] - The company’s total liabilities as of June 30, 2023, were HKD 2,260,879 thousand, a slight decrease from HKD 2,292,493 thousand as of December 31, 2022, reflecting a reduction of 1.38%[33] Segment Performance - Revenue from external customers in the retail segment was HKD 116,198,000, which is an increase from HKD 101,167,000 in the previous year, reflecting a growth of approximately 14.9%[23][26] - The financial services segment generated revenue of HKD 9,844,000, down from HKD 12,326,000 in the previous year, representing a decrease of about 20.1%[23][26] - The reported segment loss for the six months ended June 30, 2023, was HKD (52,230,000), compared to a loss of HKD (10,441,000) for the same period in 2022, indicating a decline in profitability[23][30] - The segment revenue from promotional branding was HKD 27,183,000, up from HKD 21,890,000, marking an increase of approximately 24.0%[23][30] - Retail segment revenue for the period was approximately HKD 116.2 million, an increase of about 14.8% compared to the previous period's HKD 101.2 million[65] Operational Costs - The company’s administrative expenses increased to HKD (41,974,000) for the current period, compared to HKD (24,106,000) in the previous year, indicating rising operational costs[23][24] - Distribution and selling expenses decreased to approximately HKD 38.0 million, a decline of about 7.3% from HKD 41.0 million in the previous period[69] - Administrative expenses decreased to approximately HKD 75.0 million, a reduction of about 7.0% from HKD 80.6 million in the previous period[70] - Financing costs increased to approximately HKD 49.2 million, an increase of about 44.3% from HKD 34.1 million in the previous period[71] Market Strategy and Future Outlook - The company continues to focus on brand promotion and retail management as part of its core business strategy[10] - The company is exploring market expansion opportunities and potential acquisitions to enhance its business portfolio[10] - The company plans to focus on expanding its market presence and enhancing its product offerings to drive future growth, although specific new product launches were not detailed in the report[23] - The company anticipates that the macro environment will remain uncertain, particularly regarding China's real estate debt and financing issues, but believes the long-term market fundamentals remain positive[86] - The company plans to focus on improving operational efficiency and strengthening its core competitiveness in retail and brand business[86] Governance and Compliance - The company has adhered to the corporate governance code, with the chairman also serving as the CEO, which the board believes provides strong and consistent leadership[87] - All directors have confirmed compliance with the standard code of conduct for securities transactions during the reporting period[88] Dividends - The company did not recommend the payment of an interim dividend for the six months ended June 30, 2023[44] - The final dividend for the fiscal year ended December 31, 2022, was HKD 0.005 per share, totaling approximately HKD 14,871,000[44] - The board has resolved not to declare any interim dividend for the period, consistent with the prior period[84]

Financial Performance - The company's overall revenue decreased by approximately 13.7% to about HKD 279.2 million in 2022, compared to HKD 323.5 million in 2021[10]. - Gross profit for the year was approximately HKD 251.7 million, a decrease of about 7.9% from HKD 273.3 million in the previous year, resulting in a gross profit margin of approximately 90.2%[10]. - The company recorded a loss attributable to shareholders of approximately HKD 81.3 million, a decrease of about 322.7% compared to a profit of HKD 36.5 million in the previous year[10]. - Retail segment revenue for the year was approximately HKD 197.3 million, a decrease of about 0.2% compared to HKD 197.6 million in 2021[12]. - The reported segment loss for the retail division increased by approximately 97.2% to about HKD 49.1 million, compared to a loss of about HKD 24.9 million in 2021[12]. - Financial services segment revenue decreased by approximately 23.2% to about HKD 21.9 million from HKD 28.5 million in 2021[12]. - The reported segment loss for financial services surged to approximately HKD 10.2 million, compared to a profit of about HKD 16.7 million in 2021[12]. - The company reported a fair value loss of approximately HKD 85.4 million from the sale of listed securities, contrasting with a fair value gain of HKD 84.6 million in the previous year[10]. - Other income and gains increased significantly by approximately 326.7% to about HKD 174.1 million from HKD 40.8 million in the comparable year[13]. Strategic Initiatives - The company established a joint venture with Iconix International Inc. to operate the PONY brand in the Asia-Pacific region, enhancing brand value and market reach[8]. - The company continues to develop SKINS' online business to adapt to changing consumer shopping behaviors, integrating online and offline experiences[7]. - The company aims to enhance operational resilience and create greater value for stakeholders amid challenging market conditions[8]. - The company plans to leverage its professional management capabilities to drive business growth and adapt to market changes[7]. - The company has a strategic focus on e-commerce and international distribution, leveraging the experience of its executives in these areas[37]. Operational Efficiency - The company successfully optimized facilities and management during the pandemic, leading to increased foot traffic and consumer spending in the second half of the year[7]. - Distribution and selling expenses rose by approximately 2.6% to about HKD 77.6 million from HKD 75.6 million in the previous year[14]. - Administrative expenses increased by approximately 14.2% to about HKD 153.1 million from HKD 134.1 million in the prior year[15]. - Financing costs rose by approximately 19.2% to HKD 74.8 million from HKD 62.7 million in the previous year[17]. Shareholder Information - The board proposed a final dividend of HKD 0.005 per ordinary share for the year, unchanged from 2021, subject to shareholder approval on June 23, 2023[30]. - The company's cash and bank balances were approximately HKD 98.1 million, down from HKD 174.3 million in 2021[23]. - The company's distributable reserves as of December 31, 2022, totaled HKD 1,443,513,000, down from HKD 1,497,926,000 in 2021[50]. - The proposed final dividend for the year is HKD 0.005 per share, totaling approximately HKD 14,871,000, consistent with the previous year[44]. Governance and Compliance - The company has adopted the corporate governance code as per the listing rules and has ensured compliance throughout the year[84]. - The board consists of six members, including three executive directors and three independent non-executive directors, ensuring a balance of skills and experience[88]. - The company has established three committees: audit, remuneration, and nomination, all primarily composed of independent non-executive directors[100]. - The audit committee is composed of three independent non-executive directors, ensuring effective oversight of financial reporting and internal controls[101]. - The company has implemented a diversity policy for the board, considering various factors such as age, culture, and professional experience to enhance governance and achieve business objectives[89]. Risk Management - The company has a structured approach to risk identification, assessment, and management, focusing on various risk categories including market, financial, and operational risks[114]. - The board is responsible for risk management and internal control, ensuring that risk monitoring is objective and effective[115]. - The company has implemented credit risk policies to comply with applicable laws and regulations, assessing potential borrowers' creditworthiness and repayment ability[121]. - An independent service provider has been appointed to assist the board in monitoring the effectiveness of the company's risk management and internal control systems[117]. Environmental, Social, and Governance (ESG) - The company is committed to environmental sustainability, promoting water conservation, energy saving, and recycling initiatives within its offices[128]. - The group has established a governance framework for sustainability, clarifying responsibilities across departments to promote sustainability-related matters[138]. - The group has set relevant environmental goals to enhance the effectiveness of its environmental protection measures[153]. - The report is prepared in accordance with the ESG reporting guidelines of the Hong Kong Stock Exchange, ensuring consistency and transparency[136]. - The group has implemented measures to enhance energy-saving awareness among employees, including installing automatic lighting sensors and using energy-efficient appliances[190]. Employee Engagement and Development - The company conducted over 1,500 hours of training during the reporting period, with an average training time of approximately 6.42 hours per employee[183]. - The training participation rate by gender shows that 43.90% of male employees and 56.10% of female employees received training in 2022[184]. - Employee performance evaluations are conducted annually, serving as a basis for merit-based salary increases and bonuses[181]. - The company promotes a work-life balance and fosters a harmonious workplace culture through various employee activities and benefits[181]. Customer Relations - The company is focused on expanding its customer base through existing networks and enhancing customer service[72]. - The group emphasizes the importance of customer feedback in driving continuous improvement and understanding market needs[162]. - The company has implemented a complaint handling system to ensure timely resolution of customer complaints, with no complaints reported during the year across its outlet and brand businesses[164].