[Overall Performance Overview](index=2&type=section&id=Overall%20Consolidated%20Results) [Consolidated Income Statement](index=2&type=section&id=Consolidated%20Income%20Statement) For the year ended December 31, 2022, the Group's revenue decreased by **16%** year-on-year to **RMB 1,124,138 thousand**, and the annual loss expanded by **76%** to **RMB 393,269 thousand**, primarily due to reduced rental income, goods and property sales, and lower net other gains, impacted by the pandemic Consolidated Income Statement Key Data (RMB '000) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Revenue | 1,124,138 | 1,341,049 | | Cost of Sales | (650,304) | (702,095) | | Gross Profit | 473,834 | 638,954 | | Operating Profit | 231,754 | 462,771 | | Loss Before Income Tax | (287,951) | (46,145) | | Loss for the Year | (393,269) | (223,947) | - Revenue decreased by **16%**, primarily due to the impact of the COVID-19 pandemic, leading to a decline in investment property rental income, goods sales, and property sales revenue[159](index=159&type=chunk) - Operating profit decreased by **50%**, mainly due to lower revenue and a **55%** reduction in net other gains[160](index=160&type=chunk) [Consolidated Statement of Comprehensive Income](index=3&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) The Group's total comprehensive loss for 2022 significantly increased to **RMB 396,578 thousand** from **RMB 207,077 thousand** in 2021, primarily reflecting the expanded loss for the year Consolidated Statement of Comprehensive Income Key Data (RMB '000) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Loss for the Year | (393,269) | (223,947) | | Other Comprehensive Income/(Loss) for the Year | (3,309) | 16,870 | | Total Comprehensive Loss for the Year | (396,578) | (207,077) | [Consolidated Statement of Financial Position](index=4&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of December 31, 2022, the Group's total assets increased to **RMB 19,810,293 thousand**, total liabilities increased to **RMB 15,416,818 thousand**, with an increase in total current liabilities and a decrease in net current assets and total equity Consolidated Statement of Financial Position Key Data (RMB '000) | Metric | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total Non-current Assets | 15,452,783 | 15,155,753 | | Total Current Assets | 4,357,510 | 3,880,919 | | Total Assets | 19,810,293 | 19,036,672 | | Total Current Liabilities | 3,914,691 | 3,073,332 | | Total Non-current Liabilities | 11,502,127 | 11,173,287 | | Total Liabilities | 15,416,818 | 14,246,619 | | Total Equity | 4,393,475 | 4,790,053 | | Net Current Assets | 442,819 | 807,587 | [Loss Per Share](index=2&type=section&id=Loss%20Per%20Share) For the year ended December 31, 2022, diluted loss per share attributable to owners of the Company expanded to **RMB 0.15** from **RMB 0.09** in 2021, reflecting the increased loss for the year Loss Per Share (RMB) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Diluted Loss Per Share | (0.15) | (0.09) | | Loss Attributable to Owners of the Company (RMB '000) | (393,288) | (224,346) | | Weighted Average Number of Ordinary Shares | 961,538,462 | 961,538,462 | - Potential ordinary shares were not included in the calculation of diluted loss per share as they had an anti-dilutive effect, thus diluted loss per share was the same as basic loss per share[81](index=81&type=chunk) [Company and Group Information](index=6&type=section&id=Company%20and%20Group%20Information) [Company Profile and Business](index=6&type=section&id=Company%20Profile%20and%20Business) BC Grand Limited primarily engages in commercial property development in mainland China, focusing on the development, operation, and management of outlet integrated commercial projects and non-outlet retail properties, with its ultimate controlling shareholder being the state-owned enterprise Beijing Capital Group Co., Ltd - The Group is primarily engaged in commercial property development, focusing on the development, operation, and management of outlet integrated commercial projects and non-outlet retail property projects in mainland China[23](index=23&type=chunk) - The Company's ultimate holding company is Beijing Capital Group Co., Ltd., a state-owned enterprise established in China[34](index=34&type=chunk) - The Company's shares are listed on the Main Board of The Stock Exchange of Hong Kong Limited, and the consolidated financial statements are presented in RMB[56](index=56&type=chunk) [Basis of Preparation and Accounting Policies](index=6&type=section&id=Basis%20of%20Preparation%20and%20Accounting%20Policies) The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards, using the historical cost convention and revaluing investment properties and derivative financial assets; despite a loss in 2022 and reduced net current assets, the Board believes the Group has sufficient financial resources based on cash flow forecasts to prepare the statements on a going concern basis - The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants, on a historical cost basis, and are revised for the revaluation of investment properties and derivative financial assets measured at fair value[36](index=36&type=chunk) - For the year ended December 31, 2022, the Group recorded a loss attributable to owners of the Company of **RMB 393,288,000** and net current assets of **RMB 442,819,000**[57](index=57&type=chunk) - The Board has reviewed the cash flow forecasts and believes the Group will have sufficient financial resources to meet its operations, thus preparing the consolidated financial statements on a going concern basis[57](index=57&type=chunk) [Changes in Accounting Policies and Disclosures](index=7&type=section&id=Changes%20in%20Accounting%20Policies%20and%20Disclosures) The Group first applied several new and revised Hong Kong Financial Reporting Standards, including those for onerous contracts and references to the Conceptual Framework, for the annual reporting period beginning January 1, 2022, and early adopted some amendments; these changes are not expected to have a significant impact on current or future periods - The Group first applied "Onerous Contracts – Cost of Fulfilling a Contract – Amendments to HKAS 37" and "Reference to the Conceptual Framework – Amendments to HKFRS 3" for the annual reporting period beginning January 1, 2022[58](index=58&type=chunk) - The Group also opted for early adoption of several amendments, including "Property, Plant and Equipment: Proceeds before Intended Use – Amendments to HKAS 16" and "Classification of Liabilities as Current or Non-current – Amendments to HKAS 1"[39](index=39&type=chunk)[59](index=59&type=chunk) - The aforementioned amendments had no impact on amounts recognized in prior periods and are not expected to have a significant impact on the current or future periods[59](index=59&type=chunk) [Operating Segment Information](index=8&type=section&id=Operating%20Segment%20Information) [Segment Revenue and Operating Profit](index=8&type=section&id=Segment%20Revenue%20and%20Operating%20Profit) The Group's operating segments include property development, investment property development and operation, and sales of goods; in 2022, the investment property development and operation segment contributed the largest share of revenue, but all segments saw a decline in revenue and operating profit compared to 2021, with property development shifting from profit to loss - Management separately considers the performance of property development, investment property development and operation, and sales of goods[61](index=61&type=chunk) Segment Revenue (from external customers) and Operating Profit/(Loss) (RMB '000) | Segment | 2022 Revenue | 2021 Revenue | 2022 Operating Profit/(Loss) | 2021 Operating Profit/(Loss) | | :--- | :--- | :--- | :--- | :--- | | Property Development | 46,737 | 148,161 | (29,160) | 63,305 | | Investment Property Development and Operation | 866,835 | 914,088 | 335,333 | 430,634 | | Sales of Goods Inventory | 210,566 | 278,800 | 6,880 | 28,384 | | Other Segments | – | – | (77,726) | (73,166) | | Total | 1,124,138 | 1,341,049 | 235,327 | 449,157 | - All revenue from the property development segment and sales of goods inventory segment is recognized at a point in time from customer contracts[91](index=91&type=chunk) [Segment Assets and Liabilities](index=9&type=section&id=Segment%20Assets%20and%20Liabilities) As of December 31, 2022, the Group's total segment assets increased to **RMB 31,386,055 thousand**, and total segment liabilities increased to **RMB 15,753,975 thousand**, with the investment property development and operation segment dominating both assets and liabilities Total Segment Assets and Liabilities (RMB '000) | Metric | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total Segment Assets | 31,386,055 | 28,991,528 | | Total Segment Liabilities | (15,753,975) | (13,698,196) | - Total segment assets exclude cash and cash equivalents, restricted cash, amounts due from related parties, deferred income tax assets, investments accounted for using the equity method, and derivative financial assets, which are centrally managed[62](index=62&type=chunk) - Total segment liabilities exclude borrowings, amounts due to non-controlling interests, deferred income tax liabilities, outlet plans, and senior asset-backed securities plans, which are centrally managed[62](index=62&type=chunk) [Detailed Financial Performance](index=11&type=section&id=Detailed%20Financial%20Performance) [Revenue, Other Gains and Other Income](index=11&type=section&id=Revenue%2C%20Other%20Gains%20and%20Other%20Income) For 2022, the Group's total revenue was **RMB 1,124,138 thousand**, a **16%** year-on-year decrease, mainly due to reduced investment property rental income, sales of goods, and property sales; net other gains and other income also declined, with a decrease in fair value gains on investment properties Revenue Sources (RMB '000) | Revenue Source | 2022 | 2021 | | :--- | :--- | :--- | | Investment Property Rental Income | 866,835 | 914,088 | | Sales of Goods | 210,566 | 278,800 | | Sales of Properties | 46,737 | 148,161 | | Total Revenue | 1,124,138 | 1,341,049 | Other Gains – Net and Other Income (RMB '000) | Item | 2022 | 2021 | | :--- | :--- | :--- | | **Other Gains – Net** | | | | Fair Value Gains on Investment Properties | 81,075 | 124,900 | | Government Grants | 13,153 | 51,772 | | Exchange (Losses)/Gains – Net | (11,800) | 17,279 | | Net Impairment Losses on Financial and Contract Assets | (1,440) | (5,697) | | Others | 4,750 | 3,289 | | **Other Income** | | | | Temporary Lease Income | 17,366 | 23,361 | | Interest Income | 8,227 | 13,614 | | Others | 1,929 | 2,958 | - Revenue from the Group's external customers primarily originated from mainland China, with no single customer accounting for more than **10%** of total revenue[71](index=71&type=chunk)[74](index=74&type=chunk) [Expenses by Nature](index=12&type=section&id=Expenses%20by%20Nature) For 2022, the Group's total expenses decreased to **RMB 1,005,644 thousand** from **RMB 1,109,754 thousand** in 2021, with major items including direct operating expenses from property management and other property-related services, cost of goods sold, and employee benefit expenses; a new inventory impairment of **RMB 26,196 thousand** was recognized this year Expenses by Nature (RMB '000) | Expense Item | 2022 | 2021 | | :--- | :--- | :--- | | Cost of Properties Sold | 31,130 | 80,317 | | Direct Operating Expenses from Property Management and Other Property-Related Services | 273,875 | 245,633 | | Cost of Goods Sold | 194,229 | 235,381 | | Employee Benefit Expenses | 194,178 | 211,450 | | Business Tax and Other Surcharges | 89,561 | 90,709 | | Depreciation and Amortization | 59,626 | 73,466 | | Advertising and Marketing | 60,502 | 90,211 | | Office and Travel Expenses | 41,833 | 45,184 | | Consultancy Fees | 15,698 | 19,557 | | Depreciation Expense for Right-of-Use Assets | 8,351 | 7,149 | | Auditor's Remuneration | 2,851 | 3,135 | | Impairment of Inventories | 26,196 | – | | Others | 7,614 | 7,312 | | Total | 1,005,644 | 1,109,754 | - Cost of properties sold in 2022 was adjusted by **RMB 15,069,000** due to the final agreement with contractors on actual overall construction costs[76](index=76&type=chunk) [Finance Costs](index=13&type=section&id=Finance%20Costs) For 2022, the Group's total finance costs slightly increased to **RMB 509,225 thousand** from **RMB 502,962 thousand** in 2021, primarily comprising interest expenses on bank and other financial institution borrowings and senior asset-backed securities plans, with a portion of interest costs capitalized Finance Costs (RMB '000) | Item | 2022 | 2021 | | :--- | :--- | :--- | | Interest Expense on Bank and Other Financial Institution Borrowings | 307,750 | 289,227 | | Interest Expense on Outlet Plans | 23,221 | – | | Interest Expense on Senior Asset-Backed Securities Plans | 297,140 | 232,016 | | Interest Expense on Lease Liabilities | 737 | 771 | | Reclassification from Cash Flow Hedge Reserve | (19,388) | 46,018 | | Reclassification from Hedge Reserve Cost | 17,922 | 8,170 | | Ineffective Portion of Cash Flow Hedges | 2,903 | 4,959 | | Net Fair Value Loss/(Gain) on Derivative Financial Instruments | – | 48,749 | | Interest Expense on Guaranteed Notes | – | – | | Total | 630,285 | 629,910 | | Less: Interest Capitalized | (121,060) | (126,948) | | Finance Costs Presented in Consolidated Income Statement | 509,225 | 502,962 | - For the year ended December 31, 2022, the capitalization rate was **5.54%** (2021: **5.40%**), and capitalized finance costs related to investment properties and properties under development[77](index=77&type=chunk) [Income Tax Expense](index=13&type=section&id=Income%20Tax%20Expense) For 2022, the Group's income tax expense decreased to **RMB 105,318 thousand** from **RMB 177,802 thousand** in 2021, primarily comprising PRC corporate income tax, land appreciation tax, and deferred income tax; PRC subsidiaries are subject to corporate income tax at a rate of **25%** Income Tax Expense (RMB '000) | Item | 2022 | 2021 | | :--- | :--- | :--- | | Current Income Tax: | | | | - PRC Corporate Income Tax | 6,315 | 37,399 | | - PRC Land Appreciation Tax | 2,554 | 21,665 | | Deferred Income Tax | 96,449 | 118,738 | | Total Tax Expense for the Year | 105,318 | 177,802 | - Provision for PRC corporate income tax has been made at a rate of **25%** on the estimated assessable profits of the Group's PRC subsidiaries for the year[78](index=78&type=chunk) - No provision for Hong Kong profits tax has been made as the Group had no assessable profits arising in Hong Kong for the year[99](index=99&type=chunk) [Dividend Policy](index=13&type=section&id=Dividend%20Policy) The Company neither paid nor declared any dividends for the years 2022 and 2021 - The Company did not pay or declare any dividends during the year (2021: Nil)[100](index=100&type=chunk) [Detailed Assets and Liabilities](index=14&type=section&id=Detailed%20Assets%20and%20Liabilities) [Trade and Other Receivables and Prepayments](index=14&type=section&id=Trade%20and%20Other%20Receivables%20and%20Prepayments) As of December 31, 2022, the Group's current portion of trade and other receivables and prepayments was **RMB 449,030 thousand**, a decrease from 2021; trade receivables primarily arose from investment property rental income, with credit terms generally ranging from **1 to 3 months** Trade and Other Receivables and Prepayments (RMB '000) | Item | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Trade Receivables Arising from Contracts with Customers | 72,444 | 65,157 | | Less: Impairment Provision for Trade Receivables | (1,626) | (572) | | Net Trade Receivables | 70,818 | 64,585 | | Prepayments to Related Parties | 16,161 | 13,516 | | Prepayments for Goods Inventory | 79,458 | 79,549 | | Other Prepayments | 23,003 | 24,806 | | Input VAT to be Deducted and Other Prepaid Taxes | 131,794 | 354,859 | | Other Deposits | 7,472 | 10,264 | | Amounts Due from Related Parties | 73,741 | 74,342 | | Other Receivables | 86,213 | 61,703 | | Less: Impairment Provision for Other Receivables | (10,707) | (10,321) | | Total | 477,953 | 673,303 | | Less: Non-current Portion – Input VAT to be Deducted | (28,923) | (35,644) | | Current Portion | 449,030 | 637,659 | - Trade receivables primarily arise from investment property rental income, with credit terms for tenants generally ranging from **1 to 3 months**[127](index=127&type=chunk) Ageing Analysis of Trade Receivables (RMB '000) | Ageing | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Within 3 months | 72,444 | 65,157 | [Other Payables and Accrued Expenses](index=15&type=section&id=Other%20Payables%20and%20Accrued%20Expenses) As of December 31, 2022, the Group's current portion of other payables and accrued expenses was **RMB 363,653 thousand**, a slight decrease from 2021, with senior asset-backed securities plans and outlet plans being major components Other Payables and Accrued Expenses (RMB '000) | Item | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Other Taxes Payable | 41,463 | 58,119 | | Employee Benefits Payable | 3,772 | 1,773 | | Other Payables and Accrued Expenses to Related Parties | 6,015 | 16,373 | | Amounts Due to Non-controlling Interests | 118,225 | 118,225 | | Interest Payable | 1,364 | 5,708 | | Senior Asset-Backed Securities Plan | 5,291,529 | 5,286,574 | | Deposits Received | 139,330 | 126,755 | | Outlet Plan | 667,489 | – | | Amounts Collected and Paid on Behalf of Customers | 5,681 | 4,373 | | Prepaid Rental Income from Merchants | 35,199 | 34,828 | | Others | 12,604 | 11,032 | | Total | 6,322,671 | 5,663,760 | | Less: Non-current Portion – Senior Asset-Backed Securities Plan and Outlet Plan | (5,959,018) | (5,286,574) | | Current Portion | 363,653 | 377,186 | - On December 9, 2019, the Group issued the Zhonglian Yichuang - BC Grand Outlet No. 1 Phase I Asset-Backed Special Plan, with a total issuance of **RMB 3,579,000,000**, comprising senior asset-backed securities (**RMB 2,700,000,000** at an annual interest rate of **5.2%** for five years) and subordinated asset-backed securities (**RMB 879,000,000** with no fixed coupon rate)[85](index=85&type=chunk)[105](index=105&type=chunk) - On May 28, 2021, the Group issued the Zhonglian ShouChuang Securities - BC Grand Outlet Phase II Asset-Backed Special Plan, with a total issuance of **RMB 3,268,000,000**, comprising senior asset-backed securities (**RMB 2,600,000,000** at an annual interest rate of **5.05%** for three years) and subordinated asset-backed securities (**RMB 668,000,000** with no fixed coupon rate)[4](index=4&type=chunk)[106](index=106&type=chunk)[129](index=129&type=chunk) - On April 27, 2022, the Group issued the China Life Investment - BC Grand Outlet Phase I Asset-Backed Plan, with an issued principal of **RMB 670,000,000** at a fixed coupon rate of **4.85%** for three years[86](index=86&type=chunk)[130](index=130&type=chunk)[164](index=164&type=chunk) [Trade Payables](index=17&type=section&id=Trade%20Payables) As of December 31, 2022, the Group's total trade payables were **RMB 1,835,198 thousand**, a decrease from 2021; trade payables are non-interest bearing and repayable within the normal operating cycle or on demand Ageing Analysis of Trade Payables (RMB '000) | Ageing | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Within 1 year | 1,232,800 | 1,526,672 | | 1 to 2 years | 425,082 | 338,555 | | 2 to 3 years | 80,869 | 132,495 | | Over 3 years | 96,447 | 13,204 | | Total | 1,835,198 | 2,010,926 | - Trade payables are non-interest bearing and repayable within the normal operating cycle or on demand[88](index=88&type=chunk) - As of December 31, 2022, there were no trade payables due to related parties (2021: **RMB 8,599,000**)[131](index=131&type=chunk) [Share Capital and Convertible Securities](index=17&type=section&id=Share%20Capital%20and%20Convertible%20Securities) The Group's share capital structure includes ordinary shares, Class A and Class B convertible preference shares, and perpetual convertible securities, all classified as equity as the Company has no contractual obligation to redeem them [Share Capital](index=17&type=section&id=Share%20Capital) As of December 31, 2022, the Company's total issued and fully paid share capital was **RMB 16,732 thousand**, comprising ordinary shares, Class A convertible preference shares, and Class B convertible preference shares, consistent with 2021 Issued and Fully Paid Share Capital (RMB '000) | Share Class | Number of Shares 2022 | Number of Shares 2021 | Amount 2022 | Amount 2021 | | :--- | :--- | :--- | :--- | :--- | | Ordinary Shares | 961,538,462 | 961,538,462 | 7,828 | 7,828 | | Class A Convertible Preference Shares | 166,976,636 | 166,976,636 | 1,329 | 1,329 | | Class B Convertible Preference Shares | 905,951,470 | 905,951,470 | 7,575 | 7,575 | | Total | 2,034,466,568 | 2,034,466,568 | 16,732 | 16,732 | [Convertible Preference Shares](index=18&type=section&id=Convertible%20Preference%20Shares) The Company issued Class A and Class B convertible preference shares, both non-redeemable with no maturity date; holders can convert them into ordinary shares and have equal dividend rights as ordinary shareholders, but with priority distribution rights upon liquidation, and Class B preference shares also have non-cumulative preferential distribution rights - Class A convertible preference shares are non-redeemable and have no maturity date; holders can convert them into ordinary shares at any time for zero consideration and enjoy dividend rights equal to those of ordinary shareholders[110](index=110&type=chunk)[134](index=134&type=chunk)[135](index=135&type=chunk) - Class B convertible preference shares are also non-redeemable and have no maturity date; holders can convert them into ordinary shares at any time for zero consideration and enjoy a non-cumulative preferential distribution right calculated at an annual interest rate of **0.01%**[113](index=113&type=chunk)[137](index=137&type=chunk)[138](index=138&type=chunk) - Both Class A and Class B convertible preference shares do not confer voting rights at general meetings, except in cases involving liquidation or changes to their rights, and they have priority distribution rights upon company liquidation[111](index=111&type=chunk)[114](index=114&type=chunk)[136](index=136&type=chunk)[140](index=140&type=chunk) [Perpetual Convertible Securities](index=19&type=section&id=Perpetual%20Convertible%20Securities) The Company issued perpetual convertible securities with no fixed maturity date, redeemable by the Company at its discretion **30 years** after the issue date; holders can convert them into ordinary shares at an initial conversion price of **HKD 2.10** per share, and are entitled to non-cumulative interest at an annual rate of **0.01%**, plus additional floating interest when ordinary shares pay dividends - Perpetual convertible securities have no fixed maturity date, and the Company may, at its sole discretion, choose to redeem them at any time from the **30th anniversary** of the issue date[141](index=141&type=chunk) - Holders can convert perpetual convertible securities into a maximum of **513,185,911** new ordinary shares at an initial conversion price of **HKD 2.10** per share[141](index=141&type=chunk) - Holders of perpetual convertible securities are entitled to receive interest at an annual rate of **0.01%**, and when ordinary shares pay dividends, additional floating interest must be paid in the same form[116](index=116&type=chunk) [Commitments and Guarantees](index=20&type=section&id=Commitments%20and%20Guarantees) [Capital Commitments](index=20&type=section&id=Capital%20Commitments) As of December 31, 2022, the Group's total capital commitments contracted but not provided for amounted to **RMB 388,023 thousand**, primarily related to properties under development, with capital commitments for investment properties reduced to zero Capital Commitments (RMB '000) | Item | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Properties Under Development | 388,023 | 423,204 | | Investment Properties | – | 51,977 | | Total | 388,023 | 475,181 | [Financial Guarantees](index=20&type=section&id=Financial%20Guarantees) As of December 31, 2022, the Group provided financial guarantees for mortgage loans arranged by certain banks for property buyers, amounting to approximately **RMB 702,104 thousand**, an increase from 2021; in case of buyer default, the Group is liable to repay the outstanding mortgage principal and related fees Financial Guarantee Amounts (RMB '000) | Item | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Mortgage Financing for Certain Property Buyers of the Group | 702,104 | 603,605 | - Under the terms of the guarantees, if a buyer defaults on mortgage loans during the guarantee period, the Group is liable to repay the outstanding mortgage principal, accrued interest, and penalties owed to the bank by the defaulting buyer, while also having the right to take over the legal title and ownership of the relevant property[119](index=119&type=chunk) [Asset Pledges](index=30&type=section&id=Asset%20Pledges) As of December 31, 2022, the Group's total pledges of investment properties and land use rights arising from borrowings amounted to **RMB 3,586,865 thousand**, an increase from 2021 Total Asset Pledges (RMB '000) | Item | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total Pledges of Investment Properties and Land Use Rights | 3,586,865 | 2,873,260 | [Contingent Liabilities](index=30&type=section&id=Contingent%20Liabilities) As of December 31, 2022, the Group had no significant contingent liabilities - As of December 31, 2022, the Group had no significant contingent liabilities[167](index=167&type=chunk)[208](index=208&type=chunk) [Management Discussion and Analysis](index=21&type=section&id=Management%20Discussion%20and%20Analysis) [Macroeconomic and Industry Overview](index=21&type=section&id=Macroeconomic%20and%20Industry%20Overview) In 2022, China's GDP reached **RMB 121 trillion**, growing by **3%** year-on-year, with per capita GDP exceeding **USD 12,000**, demonstrating economic resilience; however, the complex international environment, slowing global economic growth, and significant impact of the pandemic on the domestic consumer market led to decreased consumer willingness; looking ahead to 2023, with epidemic prevention entering a new phase and pro-consumption policies implemented, the domestic consumer market is expected to steadily recover - In 2022, China's GDP reached **RMB 121 trillion**, a year-on-year increase of **3%**; per capita GDP reached **RMB 85,698**, equivalent to **USD 12,741** at the average annual exchange rate[150](index=150&type=chunk) - The domestic consumer market was significantly affected by short-term pandemic disruptions, with restricted group and contact-based consumption, leading to decreased consumer willingness and a **0.2%** year-on-year decline in total retail sales of consumer goods for the full year[173](index=173&type=chunk) - The state continues to introduce medium-to-long-term measures to boost consumption, such as the "Outline of the Strategic Plan for Expanding Domestic Demand (2022-2035)", with China's economy expected to improve overall in 2023, driving an increase in residents' consumption capacity and willingness[124](index=124&type=chunk)[151](index=151&type=chunk) [Business Review](index=23&type=section&id=Business%20Review) In 2022, the Group's business was severely impacted by the pandemic, leading to store closures, reduced foot traffic, and lower sales across multiple outlet projects; to address these challenges, the Group actively innovated marketing, strengthened member operations, expanded online channels, successfully opened the Xiamen Outlet project, and now all **15** self-owned outlet projects are operational; additionally, the Group successfully established asset-backed plans, attracting insurance capital, and achieved successful exits for entrusted management projects - For the full year 2022, foot traffic was **39.07 million** visits, a year-on-year decrease of approximately **20%**; full-year sales amounted to **RMB 8.198 billion**, a year-on-year decrease of approximately **18%**[153](index=153&type=chunk) - The Group supported merchants through difficulties, providing rent reductions of approximately **RMB 35 million**[175](index=175&type=chunk) - The membership system was upgraded and revamped, leading to a significant **24%** year-on-year increase in total members, with online sales of approximately **RMB 30 million**[154](index=154&type=chunk)[155](index=155&type=chunk)[177](index=177&type=chunk) - The Xiamen Outlet project made a splendid debut, and as of the end of 2022, all **15** of the Group's self-owned outlet projects were operational[156](index=156&type=chunk)[179](index=179&type=chunk) - In collaboration with China Life Investment Holding Company Limited, the Group successfully established the "China Life Investment - BC Grand Outlet Phase I Asset-Backed Plan," opening a new channel for insurance capital to serve the real economy[156](index=156&type=chunk)[180](index=180&type=chunk) [Future Development and Outlook](index=26&type=section&id=Future%20Development%20and%20Outlook) The Group will closely follow national policies, deepen its transformation from a real estate enterprise to a retail enterprise, and strengthen its "profit-centric" and "customer-centric" business philosophies; future focus will be on enhancing investment attraction, operations, digitalization, and innovation capabilities, enriching consumption scenarios, strengthening private domain traffic operations, and steadily advancing a light-asset strategic layout to consolidate its industry-leading position - Deepen the transformation and upgrade from a real estate enterprise to a retail enterprise, strengthening the "profit-centric" and "customer-centric" business philosophies[184](index=184&type=chunk) - Emphasize a shopping experience of "big brands, small prices, good service," enrich consumption scenarios, and explore integrating empowering business formats such as the pet economy, outdoor social activities, trendy home furnishings, and tea/coffee lifestyle into outlet operations[157](index=157&type=chunk) - Continuously strengthen private domain traffic operations, complete the transformation from an online mall to a member mall, build online retail channels, and expand the number of active members[157](index=157&type=chunk) - Steadily advance a light-asset strategic layout, adopting diversified approaches such as management output, overall leasing, and equity cooperation to achieve diversified revenue growth and consolidate its industry-leading position[158](index=158&type=chunk) [Financial Review](index=27&type=section&id=Financial%20Review) The Group's 2022 financial performance was significantly impacted by the pandemic, with substantial declines in revenue and operating profit, and an expanded annual loss; despite this, cash and cash equivalents increased, but the net gearing ratio rose; the Group actively financed through asset-backed plans and managed foreign exchange risks [Revenue and Operating Results](index=27&type=section&id=Revenue%20and%20Operating%20Results) In 2022, the Group's

Financial Performance - In the first half of 2022, the group achieved outlet sales of approximately RMB 4.42 billion, a decrease of about 15% compared to the same period last year[14]. - The group's operating revenue for the first half of 2022 was approximately RMB 550,839,000, a decrease of about 19% year-on-year, with a net loss attributable to the parent company of approximately RMB 116,116,000[16]. - The total retail sales of consumer goods in China for the first half of 2022 amounted to RMB 21,043.2 billion, a decrease of 0.7% year-on-year[20]. - The company reported a total of 738,130,482 Class A convertible preferred shares issued, with a capital increase of approximately RMB 5,875,000 and a share premium of approximately RMB 1,556,817,000[185]. - The company reported a total of 905,951,470 Class B convertible preferred shares, resulting in a capital increase of approximately RMB 7,575,000 and a share premium of approximately RMB 2,098,232,000[186]. Visitor and Foot Traffic Trends - The total foot traffic for shopping centers nationwide was approximately 12.89 billion visits, a decline of about 21% year-on-year and a 39% decrease compared to 2019[13]. - The group recorded approximately 20.09 million visitors, a decrease of about 16% year-on-year, primarily due to the impact of COVID-19 restrictions[14]. - The average daily foot traffic in shopping centers decreased by approximately 12.6% compared to the same period in 2021, and by about 34% compared to the same period in 2019[21]. Consumer Confidence and Market Conditions - The consumer confidence index dropped significantly from 121.5 in January to 86.8 in May 2022, indicating a cautious consumer sentiment[20]. - The overall retail sales of consumer goods in China amounted to RMB 21.04 trillion, a decrease of 0.7% compared to the previous year[13]. - The group aims to boost consumer confidence through precise marketing and lean operations, enhancing customer satisfaction[14]. Operational Strategies and Innovations - The group has implemented measures to enhance COVID-19 management and improve operational safety while focusing on online and offline integration[14]. - The company is actively innovating and upgrading its membership system to create value for merchants and customers[14]. - The group plans to enhance its member system with a focus on rights, services, and systems to improve online and offline integration and marketing effectiveness[18]. - The group will adopt a "one store, one strategy" approach to improve operational efficiency and enhance customer experience[18]. Membership and Sales Performance - The total number of members increased by approximately 13% compared to the same period last year, with member sales accounting for an increase of about 6 percentage points[15]. - Member sales accounted for approximately 43% of total sales, an increase of about 6 percentage points compared to the same period last year[28]. - The company launched a significant promotional event in May, celebrating its 10th anniversary, which generated nearly RMB 1 million in sales and attracted approximately 270,000 viewers[24]. Financial Position and Liquidity - As of June 30, 2022, the company's cash and cash equivalents totaled approximately RMB 1,049,784,000, an increase from RMB 804,308,000 as of December 31, 2021[34]. - The current ratio as of June 30, 2022, was 1.38, up from 1.26 as of December 31, 2021, indicating improved liquidity[35]. - The net capital debt ratio was 223% as of June 30, 2022, compared to 208% at the end of 2021, reflecting an increase in net debt[35]. Asset Management and Investments - The group has launched a new asset-backed plan in collaboration with China Life Investment Holdings, marking a significant milestone in the CMBS market[16]. - The company issued an asset-backed securities plan totaling RMB 3,579,000,000 on December 9, 2019, to securitize properties in Beijing and Kunshan[39]. - The group issued asset-backed securities with a total principal amount not exceeding RMB 1,350,000,000, and as of June 30, 2022, RMB 670,000,000 has been issued at a fixed interest rate of 4.85% for a term of 3 years[41]. Employee and Workforce Changes - The company had 1,092 employees as of June 30, 2022, down from 1,153 employees a year earlier, reflecting a reduction in workforce[65]. Future Outlook - Future outlook suggests that the outlet market is expected to recover further in the second half of 2022, with new openings in Qingdao and Xiamen enhancing the national strategic layout[66]. - The company aims to maintain competitive advantages in pricing, experience, and brand, focusing on providing superior consumer experiences in the outlet industry[67]. Corporate Governance and Compliance - The company has adhered to the corporate governance code as per the listing rules, with minor deviations noted due to COVID-19 restrictions[61]. - The board consists of nine directors, including two executive directors, four non-executive directors, and three independent non-executive directors[59].

Sales Performance - In January, the Kunming Capital Outlets achieved over RMB 100 million in sales within the first month of operation, setting a record for the company[7]. - During the Spring Festival, total sales across 13 cities exceeded RMB 800 million, with customer traffic increasing nearly 75% compared to 2019[8]. - The company’s 14th outlet project in Nanning opened, attracting nearly 160,000 visitors and generating sales of approximately RMB 14 million on the opening day[20]. - During the National Day holiday, the company achieved sales of RMB 500 million through immersive marketing experiences across 14 outlet cities[20]. - The company launched an online sales event that generated nearly RMB 1.2 million in sales through a community and live-streaming marketing approach[23]. - The sales for the Nanning outlet exceeded RMB 100 million within 28 days of opening, marking a new high for the company's outlet projects[47]. - The company reported a total sales revenue where the largest customer accounted for approximately 4.25% and the top five customers represented about 10.04% of total sales during the fiscal year[99]. Financial Performance - The company's revenue for the year reached RMB 1,341,049,000, marking a 31% growth year-on-year[27]. - The company's outlet sales exceeded RMB 10 billion for the first time, with a year-on-year increase of 35%[26]. - The net loss attributable to the parent company was RMB 223,947,000, and the board decided not to distribute dividends for the year ending December 31, 2021[27]. - The company's revenue for 2021 was approximately RMB 1.341 billion, a 31% increase from RMB 1.024 billion in 2020, primarily driven by improved sales performance in the outlet sector[51]. - The gross profit margin for 2021 was approximately 48%, an increase of 14 percentage points from 34% in 2020, due to higher rental income and effective cost control[51]. - The operating profit for 2021 was approximately RMB 462.77 million, a 74% increase from RMB 266.53 million in 2020, attributed to revenue growth and cost management[51]. - The company's net loss for 2021 was approximately RMB 223.95 million, a 30% reduction from RMB 317.69 million in 2020, mainly due to the increase in operating profit[51]. Strategic Initiatives - The company plans to enhance operational capabilities and digital operations in 2022, focusing on consumer value enhancement and merchant value creation[27]. - The company aims to achieve its strategic layout goals with the opening of new outlet projects in Qingdao and Xiamen in 2022[28]. - The company will continue to integrate brand resources and commercial operation capabilities, focusing on comprehensive outlet operations[28]. - The company emphasizes the importance of timely and precise responses to market changes to achieve success in the retail sector[28]. - The company is committed to driving value creation for shareholders, customers, and partners through dual-driven commercial and asset management strategies[28]. - The company anticipates that consumer growth will be supported by urbanization, social welfare policies, and the dual circulation development pattern in China[27]. Operational Challenges - The company is facing challenges due to the pandemic and extreme weather, but has shown resilience in maintaining sales performance[45]. - The company effectively minimized losses for nearly 200 merchants during extreme weather in Zhengzhou by implementing rapid response measures[19]. - The group anticipates that the consumer market recovery in 2022 will face uncertainties due to ongoing pandemic control measures and economic pressures[61]. Corporate Governance - The board consists of nine directors, including two executive directors and three independent non-executive directors, ensuring a diverse composition[153]. - The company has adopted a diversity policy for board members, emphasizing the importance of diverse perspectives for competitive advantage[154]. - The board's composition is reviewed annually to ensure it meets the company's evolving business needs and diversity goals[154]. - The company has established four committees under the board, including the Audit Committee, Remuneration Committee, Nomination Committee, and Strategic Investment Committee[168]. - The board has adopted the corporate governance code as its corporate governance policy and practices, ensuring compliance with legal and regulatory requirements[145]. Risk Management - The company has established a comprehensive risk management system, with the board responsible for assessing risks related to achieving strategic goals, including ESG-related risks[185]. - The Risk Control Center, authorized by the Audit Committee, regularly reviews and assists the board in formulating effective risk management policies and guidelines[186]. - As of the report date, the Risk Control Center assessed the company's risk management and internal control systems, concluding that there were no significant weaknesses[187]. Employee and Director Information - The group employed 1,181 staff as of December 31, 2021, with total employee benefits expenses (excluding directors' remuneration) amounting to approximately RMB 211.45 million[60]. - Approximately 48% of the company's 1,181 employees are female, reflecting the company's commitment to gender diversity[157]. - The company has purchased adequate insurance for all directors to protect against potential legal liabilities arising from their duties[152]. Shareholder Information - The company has a significant shareholder, 首置投資控股有限公司, holding 701,353,846 shares, representing approximately 72.94% of the issued share capital[112]. - The total equity held by 首置投資控股有限公司, including convertible preferred shares, amounts to 1,774,281,952, which is 184.53% of the total issued shares[112]. - The board of directors did not recommend any dividend distribution for the fiscal year ending December 31, 2021[88]. Audit and Financial Statements - The financial statements audited include the consolidated balance sheet, income statement, comprehensive income statement, statement of changes in equity, and cash flow statement for the year ended December 31, 2021[200]. - The independent auditor's remuneration for the year ended December 31, 2021, was RMB 2,349,000 for audit services and RMB 250,000 for non-audit services[191]. - The company has not changed auditors in the past three years, and the auditors are responsible for providing an independent opinion on the financial statements[141].

Financial Performance - The group achieved an outlet revenue of approximately RMB 5.2 billion, representing a year-on-year growth of 84%[10] - The total foot traffic reached 24 million visitors, an increase of 64% compared to the previous year[10] - Self-operated product sales amounted to approximately RMB 166 million, reflecting a year-on-year growth of 70%[11] - The online sales on the group's platform exceeded RMB 25 million, with a year-on-year increase of over 110%[11] - The group achieved operating revenue of RMB 682,911,000, representing a year-on-year growth of approximately 73%, while the net loss attributable to the parent company was RMB 19,803,000[12] - The company's revenue for the six months ended June 30, 2021, was approximately RMB 682,911,000, representing a 73% increase compared to RMB 393,935,000 for the same period in 2020[23] - The gross profit margin for the same period was approximately 51%, up 21% from 30% in the previous year, primarily due to higher gross profit from property sales[23] - Operating profit for the six months was approximately RMB 309,299,000, a 55% increase from RMB 200,126,000 in the prior year[23] - The company reported a period loss of approximately RMB 19,449,000 for the six months, a reduction of 82% from a loss of RMB 106,768,000 in the previous year[23] Capital and Financing - The group successfully issued the second phase of asset-backed special plans, with a total issuance scale of RMB 3.268 billion[11] - The group issued an asset-backed securities plan totaling RMB 3,579,000,000, which included RMB 2,700,000,000 in senior asset-backed securities with a fixed interest rate of 5.2%[29] - Another asset-backed securities plan was issued for RMB 3,268,000,000, including RMB 2,600,000,000 in senior securities with a fixed interest rate of 5.05%[30] - As of June 30, 2021, the group's borrowings from banks and other financial institutions amounted to approximately RMB 4,737,160,000, an increase from RMB 4,304,436,000 as of December 31, 2020[27] - The company's cash and cash equivalents totaled RMB 3,409,763,000 as of June 30, 2021, compared to approximately RMB 854,786,000 at the end of 2020[24] - The company secured long-term borrowings of approximately RMB 1,980 million to address the maturity of guaranteed notes[74] - The company’s total liabilities included approximately RMB 2,599 million of guaranteed notes due on August 2, 2021[74] Operational Strategy - The group focused on enhancing project operation capabilities, gaining recognition from mainstream investment institutions[11] - The group emphasized the importance of digitalization and innovative services to boost consumer confidence and operational efficiency[10] - The group plans to enhance its big data operational capabilities to better meet consumer trends and strengthen its market position[12] - The company is focused on enhancing brand reputation and competitiveness in the outlet industry, aiming to become the most valuable operator providing excellent consumer experiences in China[52] - The company plans to continue launching new projects in the outlet market in the second half of 2021, focusing on market share and consumer demand trends[52] ESG and Corporate Governance - The group initiated the "2021-2023 ESG three-year construction plan," integrating ESG into brand building[11] - The group initiated the 2021-2023 ESG three-year construction plan to align with national carbon neutrality goals, aiming to enhance brand value through sustainable development strategies[19] - The company has adhered to the corporate governance code and has made efforts to improve transparency and accountability to shareholders[45] - The board believes that written resolutions enhance decision-making efficiency, despite some deviations from the corporate governance code[47] - The company has confirmed full compliance with the standard code for securities trading by all directors for the six months ending June 30, 2021[49] Employee and Management - As of June 30, 2021, the group had 1,153 employees, a decrease from 1,247 employees as of June 30, 2020[51] - The company has implemented a salary policy based on market conditions and individual performance, alongside providing various employee benefits[51] - The total remuneration for key management personnel was RMB 4,859,000 for the six months ended June 30, 2021, down from RMB 5,656,000 for the same period in 2020[163] Market and Industry Recognition - The group received 27 awards at the 8th China Outlet Industry Development Forum, including the Annual Strength Award and Annual Leading Award, further solidifying its industry reputation[20] - The group hosted the 2020-2021 brand merchant commendation conference to recognize the support of partner brands, emphasizing collaboration for future achievements[19] Assets and Liabilities - Total assets as of June 30, 2021, amounted to RMB 21,273,992,000, an increase from RMB 18,312,753,000 as of December 31, 2020[6] - Non-current liabilities increased to RMB 9,376,040,000 from RMB 6,018,251,000, indicating a rise of 55.5%[63] - Current liabilities decreased to RMB 6,913,164,000 from RMB 7,297,372,000, a reduction of 5.3%[63] - The company’s current liabilities exceeded current assets by approximately RMB 465 million as of June 30, 2021[74] Investment Properties - The fair value of investment properties as of June 30, 2021, is RMB 11,838,904,000, with no transfers between levels during the period[98] - The company utilizes independent professional appraisers for the valuation of its investment properties, employing methods such as discounted cash flow analysis[99] - The net fair value gain from investment properties was RMB 123,716,000 for the six months ended June 30, 2021, down from RMB 304,980,000 in the previous year[127] Related Party Transactions - The group recorded related party transactions for service provision totaling RMB 22,752,000 for the six months ended June 30, 2021, compared to RMB 11,464,000 for the same period in 2020[162] - The group had receivables from related parties amounting to RMB 71,016,000 as of June 30, 2021, unchanged from December 31, 2020[165] - The group had payables to related parties totaling RMB 118,225,000 as of June 30, 2021, consistent with the amount as of December 31, 2020[166]

Sales Performance - In January, the company achieved nearly RMB 1 billion in sales during the "Capital Twelve Cities Celebration" event[6]. - In October, the company generated RMB 800 million in sales during the "Capital Twelve Cities, Happy Shopping National Day" campaign[13]. - During the "Double Festival" period in October, the company achieved sales of RMB 800 million and attracted 2.3 million visitors across 12 cities[19]. - The grand opening of the Kunming outlet attracted over 80,000 visitors on its first day, generating sales exceeding RMB 15 million, and reached a total of 500,000 visitors and sales of over RMB 1 billion in its first month[16][19]. - In 2020, the company achieved a total sales revenue of approximately RMB 7.4 billion, with a customer traffic of 38.1 million visits[38]. Marketing and Promotions - In February, the company announced a 38-day rent exemption and fee waivers for merchants in response to the COVID-19 pandemic[7]. - During March and April, the company launched a new marketing model called "BOSS Live" to enhance online sales channels amid reduced foot traffic[8]. - In May, the company reported a significant recovery in customer traffic and sales performance across its twelve outlets post-epidemic[9]. - In August, the company transformed its Hainan outlet with a new model combining "big brands + tourism + no purchase limit," and launched a nationwide member reward activity[12]. - In November, the company hosted the 2020 New Silk Road World Model Contest, attracting 3,492 participants and achieving 110 million online exposures[15]. Financial Performance - In 2020, the company achieved an operating revenue of RMB 1,024,035,000, a decrease of 45% compared to the previous year, with a net loss attributable to the parent company of RMB 320,446,000[21]. - The company's revenue for 2020 was approximately RMB 1,024,035,000, a decrease of 45% compared to RMB 1,864,672,000 in 2019[43]. - The gross profit margin for 2020 was about 34%, down 13 percentage points from 47% in 2019[44]. - The operating profit for 2020 was approximately RMB 266,531,000, a decrease of 42% from RMB 456,831,000 in 2019[44]. - The annual loss for 2020 was approximately RMB 317,689,000, an increase of 42% compared to RMB 223,052,000 in 2019[44]. Operational Strategies - The company plans to strengthen its operational strategies in 2021 by focusing on cost control, efficiency improvement, and enhancing the customer shopping experience[22]. - The company aims to deepen its digital transformation and data asset collection capabilities to better meet consumer demands and improve operational efficiency[21]. - The company will continue to explore new retail and digital upgrades to redefine the outlet shopping experience and enhance brand characteristics[22]. - The company is committed to optimizing its supply chain and enhancing brand partnerships to reduce costs and improve operational efficiency[40]. - The company aims to enhance its operational model by focusing on the new characteristics of core customer groups and trends in brand upgrades, particularly targeting the middle-class health and rational consumption[58]. Market Expansion - The company has opened a total of 13 outlet projects, maintaining the leading position in the industry in terms of the number of opened projects[19]. - The company plans to open new outlet projects in cities such as Zhengzhou, Jinan, and Nanning, with expected opening dates ranging from 2018 to 2022[34]. - The company is actively expanding its market presence through new outlet developments and strategic investments in various cities[36]. - The company holds a 100% equity interest in most of its outlet projects, ensuring full control over operations and management[33]. - The company has a total of 15 outlet projects across various cities, with a total construction area of approximately 1,500,000 square meters[33]. Risk Management - The company faced strategic, operational, financial, legal, and market risks, influenced by macroeconomic trends and external factors such as the pandemic[84]. - The company has established a comprehensive risk management system, which includes risk identification, risk measures, internal audit evaluation, and continuous improvement[149]. - The independent auditor's report confirms that the consolidated financial statements present a true and fair view of the group's financial position as of December 31, 2020[162]. - The Risk Control Center assessed the company's risk management and internal control, concluding that there are no significant weaknesses in internal controls[151]. - The company is committed to enhancing risk management efficiency through a self-supervised risk control model at the business level[150]. Corporate Governance - The board of directors consists of nine members, including two executive directors, four non-executive directors, and three independent non-executive directors[128]. - The company has adopted a corporate governance code as its regular governance practice for the year ended December 31, 2020[147]. - The independent non-executive directors represent one-third of the board, ensuring compliance with independence requirements[132]. - The company has implemented a comprehensive training program for new directors to ensure they understand their responsibilities and the regulatory environment[133]. - The board actively promotes transparency and accountability to all shareholders[127]. Employee and Management Changes - The company had borrowings of approximately RMB 4,304,436,000 as of December 31, 2020, an increase from RMB 3,765,000,000 in 2019[48]. - As of December 31, 2020, the group had 1,234 employees, a decrease from 1,297 employees as of December 31, 2019[56]. - The company appointed Mr. Gao Baofeng as Vice President in September 2020, bringing extensive experience from various leadership roles in state-owned enterprises and the military[71]. - Ms. Lu Yi was appointed as Vice President in August 2016, previously managing retail operations for major shopping centers and international groups[73]. - Mr. Chi Chao has served as Chief Financial Officer since October 2017, with prior experience in financial management at listed companies[76]. Shareholder Information - Major shareholder, Shouchuang Investment Holdings, owns 72.94% of the company's issued share capital, totaling 701,353,846 shares[102]. - The total equity held by Shouchuang Investment, including convertible shares, amounts to 1,774,281,952 shares, representing 184.53% of the total issued shares[102]. - KKR Group Partnership holds 95,192,308 shares, accounting for approximately 9.9% of the issued share capital[104]. - The company has adhered to the non-competition commitments under the revised non-competition agreements with Shouchuang Investment[101]. - The board does not recommend the distribution of any dividends for the fiscal year ending December 31, 2020[86].

Financial Performance - The company achieved a revenue of RMB 393,935,000, a decrease of 69% compared to the same period last year[8]. - The net loss attributable to the parent company was RMB 107,978,000[8]. - The company's revenue for the six months ended June 30, 2020, was approximately RMB 393.94 million, a decrease of 69% compared to RMB 1.27 billion for the same period in 2019[18]. - The gross profit margin for the six months ended June 30, 2020, was approximately 30%, down 21 percentage points from 51% in the same period of 2019[18]. - Operating profit for the six months ended June 30, 2020, was approximately RMB 200.13 million, a decrease of 55% compared to RMB 447.56 million in the same period of 2019[18]. - The company reported a loss of approximately RMB 106.77 million for the six months ended June 30, 2020, compared to a profit of RMB 22.92 million in the same period of 2019, representing a decrease of 566%[19]. - Revenue for the six months ended June 30, 2020, was RMB 393,935 thousand, a decrease of 68.9% compared to RMB 1,265,581 thousand in 2019[50]. - Gross profit for the same period was RMB 117,539 thousand, down 81.8% from RMB 646,003 thousand in 2019[50]. - The company reported a net loss of RMB 106,768 thousand for the period, compared to a profit of RMB 22,918 thousand in 2019[52]. Sales and Marketing Strategies - The company is enhancing its digital operations by partnering with Alibaba Cloud to leverage big data and new retail integration[8]. - The company has implemented new marketing strategies, including live streaming and community marketing, to attract consumers and stabilize sales[7]. - The company is actively adapting to post-pandemic consumer behavior changes by accelerating digital transformation[6]. - The company implemented innovative sales formats and conducted nationwide live streaming events to boost sales during the pandemic, achieving a sales increase of nearly 40% across twelve cities[13]. - The company introduced family-oriented consumption brands to enrich the experiential offerings and enhance customer engagement, effectively improving project attractiveness[13]. Operational Efficiency and Growth - The company is focusing on brand structure adjustment and increasing sales frequency to improve operational efficiency[7]. - The company aims to deepen its supply chain management and optimize its brand resource database to drive operational efficiency and growth[9]. - The company plans to enhance digital construction and strengthen online promotion to meet the evolving shopping habits of consumers and accelerate market expansion[9]. - The company is focusing on enhancing consumer insights through big data analysis to improve consumer satisfaction and shopping experiences[42]. - The company plans to adapt to new consumer demands and preferences in the post-pandemic era, emphasizing differentiated shopping experiences and product management[43]. - The company aims to accelerate the transformation to a light-asset operation model to improve capital efficiency[43]. Financial Position and Liabilities - As of June 30, 2020, the group's cash and cash equivalents totaled RMB 1,674,170,000, down from RMB 2,178,729,000 as of December 31, 2019[20]. - The current ratio as of June 30, 2020, was 1.13, compared to 1.25 as of December 31, 2019[21]. - The net capital debt ratio increased to 165% as of June 30, 2020, from 134% as of December 31, 2019, primarily due to an increase in net debt[21]. - Borrowings from banks and other financial institutions amounted to approximately RMB 4,563,500,000 as of June 30, 2020, compared to RMB 3,765,000,000 as of December 31, 2019[24]. - The total financial liabilities amounted to RMB 13,593,544 thousand, an increase from RMB 12,874,529 thousand as of December 31, 2019[91]. - The net debt increased to RMB 8,502,006 thousand as of June 30, 2020, compared to RMB 7,089,693 thousand as of December 31, 2019, resulting in a capital debt ratio of 165%[92]. - The total borrowings as of June 30, 2020, were RMB 4,563,500 thousand, up from RMB 3,765,000 thousand as of December 31, 2019[92]. Corporate Governance and Compliance - The company is committed to maintaining good corporate governance standards and effective risk management[38]. - The audit committee, consisting of three independent non-executive directors, reviewed the group's accounting principles and financial reporting matters[40]. - The company has complied with the corporate governance code and regulations as of June 30, 2020, with a noted exception regarding the attendance of the chairman at the annual general meeting[38]. - The board of directors consists of nine members, including two executive directors, four non-executive directors, and three independent non-executive directors[36]. Impact of COVID-19 - The company has faced temporary adverse effects on revenue due to COVID-19, including rent exemptions and property management fee waivers[73]. - The company continues to monitor the impact of COVID-19 on its financial condition and operational results[73]. - The company provided temporary rent reductions to merchants to support them during the pandemic, demonstrating its commitment to social responsibility[12]. Awards and Recognition - The company received 19 awards, including the "China Outlet Innovative Marketing Award," at the annual industry conference, highlighting its strong market reputation[14].

Financial Performance - The group achieved an annual revenue of RMB 7.83 billion, representing a year-on-year growth of over 53%[17]. - The company achieved a revenue of RMB 1,864,672,000, representing a 52% increase compared to the same period last year, while the net loss attributable to the parent company was RMB 223,539,000[19]. - The company's revenue for 2019 was approximately RMB 1,864,672,000, an increase of 52% compared to RMB 1,224,040,000 in 2018[47]. - Gross profit for the year was RMB 878,423 thousand, up from RMB 405,600 thousand in the previous year, indicating a significant improvement in profitability[190]. - The operating profit increased to RMB 456,831 thousand, compared to RMB 255,855 thousand in 2018, reflecting a growth of 78.5%[190]. - The annual loss for 2019 was approximately RMB 223,052,000, a 13% increase from RMB 197,458,000 in 2018[48]. - The company's equity attributable to owners decreased to RMB 5,238,997 thousand in 2019 from RMB 5,460,156 thousand in 2018, a decline of 4.0%[199]. - The company reported a loss of RMB 223,539 thousand for the year, compared to a profit in the previous year[199]. Project Development - The number of opened projects reached 12, maintaining the highest number in the industry[17]. - The Beijing project phase two, Jinan project, Xi'an project, and Chongqing project were successfully launched on schedule[17]. - The company plans to steadily advance new project construction and enhance operational efficiency of existing projects, focusing on the core operational concept of "products are the soul, adjustments are eternal, the environment must be appealing, and service is fundamental"[20]. - The company completed the acquisition of the remaining 45% minority interest in the Hainan Outlets project, resulting in 100% ownership as of December 31, 2019[106]. Customer Engagement and Marketing - During promotional activities, customer traffic exceeded 10 million, generating sales of over RMB 1.8 billion[17]. - The total customer traffic reached 41.29 million, an increase of 32% compared to the previous year[41]. - The unified marketing campaign generated sales of RMB 1.8 billion over 18 days, attracting over 10 million visitors[44]. - The company added 690,000 new members, marking a 75.5% increase year-on-year, enhancing customer relationship management capabilities[43]. - The Jinan outlet opened with over 300,000 visitors and sales of RMB 38 million within the first three days[42]. - The Beijing outlet's second phase opened with over 170,000 visitors and sales exceeding RMB 50 million on the opening day[42]. Strategic Partnerships and Digital Innovation - The company engaged in a deep collaboration with Alibaba Cloud to enhance its new retail initiatives[12]. - The company has established a strategic partnership with Alibaba Cloud to enhance its digital operation system and support smart mall operations, online-offline integration, and intelligent data analysis[18]. - The company is committed to digital innovation and smart operations to deeply understand consumer needs and provide warm products and services, aiming to reduce costs, increase efficiency, and enhance experience[21]. - The company plans to enhance its digital operational management system and strengthen data analysis capabilities through strategic cooperation with Alibaba Cloud[61]. Financial Position and Liabilities - As of December 31, 2019, the company's cash and cash equivalents totaled approximately RMB 2,178,729,000, down from RMB 3,441,664,000 at the end of 2018[49]. - The current ratio as of December 31, 2019, was 1.25, compared to 1.66 at the end of 2018[50]. - The net capital debt ratio increased to 134% as of December 31, 2019, from 90% in 2018[50]. - Total liabilities increased to RMB 12,519,666 thousand in 2019 from RMB 12,095,941 thousand in 2018, representing a growth of 3.5%[197]. - The company's borrowings rose significantly to RMB 1,135,304 thousand in 2019 from RMB 736,467 thousand in 2018, an increase of 54.1%[197]. Governance and Management - The board of directors presented the annual report and audited consolidated financial statements for the year ending December 31, 2019[81]. - The company has a strong management team with diverse backgrounds in finance, marketing, and operations, enhancing its strategic capabilities[75][76][77][78][79][80]. - The board consists of nine directors, including two executive directors, four non-executive directors, and three independent non-executive directors[134]. - The company has established four committees under the board, including the Audit Committee, Remuneration Committee, Nomination Committee, and Strategic Investment Committee, each with defined responsibilities[143]. Risk Management - The group faced strategic, market, operational, financial, and legal risks, influenced by macroeconomic trends and regulatory changes[84]. - The risk management center assessed the company's risk management and internal control, concluding that there are no significant weaknesses in internal controls[157]. - The company has implemented a comprehensive risk management system, focusing on risk identification, measures, internal audit evaluation, and continuous improvement[155]. - The company has updated its risk management policies and guidelines in response to the COVID-19 pandemic, ensuring effective risk control measures[156]. Market Outlook - The company anticipates continued stable growth in the consumer market, driven by rising household income and effective consumption promotion policies, despite potential impacts from international trade tensions and COVID-19[20]. - The retail industry is expected to evolve into a combination of consumption, entertainment, and social interaction, requiring improved digital operational capabilities and consumer insights[60]. Shareholder Communication - The company emphasizes the importance of shareholder communication and has held an annual general meeting to facilitate this[161]. - The company’s website provides comprehensive and accessible information for shareholders and investors, which is regularly updated[166]. - The board is committed to maintaining open and transparent communication with shareholders, providing access to new information via the company website[160].

Revenue Growth - The group achieved a revenue of RMB 1,265,581,000, representing a 223% increase compared to the same period last year[9]. - The company achieved a total revenue of approximately RMB 36.4 billion, representing a year-on-year growth of 54%[12]. - The company's revenue for the six months ended June 30, 2019, was approximately RMB 1,265,581,000, an increase of 223% compared to RMB 391,236,000 for the same period in 2018[19]. - Revenue for the six months ended June 30, 2019, was RMB 1,265,581,000, a significant increase from RMB 391,236,000 for the same period in 2018, representing a growth of approximately 223%[142]. - Property sales contributed RMB 919,704,000 to revenue, up from RMB 196,645,000 in the previous year, indicating a growth of about 367%[142]. Sales Performance - The group's outlet sales reached RMB 3.64 billion, with a year-on-year growth of over 54%[7]. - The Beijing Fangshan store achieved sales of RMB 350 million during holidays, a 76% increase year-on-year, with monthly sales exceeding RMB 200 million[7]. - The Jinan project attracted over 300,000 visitors and generated sales of RMB 38 million within three days of opening[7]. - The second phase of the Beijing Fangshan project recorded a footfall of 170,000 and sales exceeding RMB 50 million on its opening day[7]. - The company implemented brand adjustments at the Beijing Fangshan store, resulting in sales exceeding RMB 400 million, with a year-on-year increase of 32%[13]. Profitability - The net profit attributable to the parent company was RMB 22,711,000, with no interim dividend declared[9]. - The net profit for the same period was approximately RMB 22,918,000, an increase of 84% compared to RMB 12,449,000 in 2018[19]. - The net profit attributable to the owners of the company for the six months ended June 30, 2019, was RMB 22,711,000, compared to RMB 12,476,000 for the same period in 2018, marking an increase of about 82%[149]. - The total tax expense for the period was RMB 247,215,000, significantly higher than RMB 91,061,000 in the previous year, representing an increase of approximately 172%[147]. Digital Transformation and Strategy - The group plans to enhance digital operations and supply chain management, focusing on new retail digital transformation and integrated online-offline operations[9]. - The company enhanced its digital transformation by integrating data platforms, improving its omnichannel marketing capabilities and big data analysis[13]. - The company plans to enhance digital customer engagement and insights, focusing on digital transformation to improve marketing precision and operational control[49]. - The company aims to strengthen its supply chain management capabilities and enhance customer experience through digital and experiential strategies[49]. Economic Environment and Future Outlook - The overall economic environment remains uncertain, but the company is committed to optimizing existing resources and innovating in products and services[9]. - The company anticipates continued consumer innovation and structural upgrades in consumption trends for the second half of the year[9]. - The company plans to continue expanding its project portfolio, maintaining a leading position in the industry with a total of ten operational projects[12]. - The company aims to expand projects in Xi'an and Chongqing while enhancing digital operational capabilities[9]. Financial Position - As of June 30, 2019, the company's cash and cash equivalents totaled RMB 1,943,888,000, down from RMB 3,441,664,000 as of December 31, 2018[20]. - The current ratio as of June 30, 2019, was 1.48, compared to 1.66 as of December 31, 2018[21]. - The net capital debt ratio was 115% as of June 30, 2019, up from 90% as of December 31, 2018, primarily due to a decrease in cash and cash equivalents[21]. - As of June 30, 2019, total assets amounted to RMB 16,876,118 thousand, a decrease from RMB 17,606,786 thousand as of December 31, 2018, representing a decline of approximately 4.14%[62]. - Total liabilities were reported at RMB 11,361,386 thousand, down from RMB 12,095,941 thousand, which is a reduction of about 6.08%[64]. Employee and Governance - The company has a total of 1,244 employees as of June 30, 2019, an increase from 895 employees as of June 30, 2018[47]. - The board of directors consists of nine members, including two executive directors, four non-executive directors, and three independent non-executive directors[42]. - The company has complied with the corporate governance code and the relevant listing rules during the reporting period, with a minor deviation regarding the attendance of the chairman at the annual general meeting[44]. - The company is committed to maintaining good corporate governance standards and effective risk management as a foundation for long-term success[44]. Investment and Capital Management - The company signed a partnership agreement on January 29, 2019, to establish a fund for investment in real estate renovation projects[22]. - The company has several outlet projects with varying completion dates, including Zhengzhou, Jinan, and Hefei, with total construction areas ranging from 55,660 to 138,440 square meters[18]. - The company holds a 100% equity interest in most of its outlet projects, indicating full ownership and control over these developments[18]. - The company has capital commitments totaling RMB 498,717,000 as of June 30, 2019, down from RMB 958,444,000 as of December 31, 2018[194]. Risk Management - The company faces foreign exchange risk primarily from transactions in HKD, USD, and RMB, managing a floating rate guaranteed note of USD 400 million[104]. - Interest rate risk arises from floating rate borrowings and guaranteed notes, with management continuously monitoring interest rate conditions[105]. - The company expects no significant credit risk related to cash and cash equivalents, as they are held in state-owned and large listed banks[107]. - For trade and other receivables, the company applies a simplified approach for expected credit loss provisioning, based on historical loss rates and macroeconomic factors[109].

Financial Performance - The company reported a revenue of RMB 1,224,040,000 for the year ended December 31, 2018, compared to RMB 511,523,000 in 2017, representing a year-over-year increase of approximately 139.3%[182]. - The gross profit for the year was RMB 405,600,000, up from RMB 225,154,000 in the previous year, indicating an increase of about 80.1%[182]. - The operating profit decreased to RMB 255,855,000 from RMB 378,766,000, reflecting a decline of approximately 32.5%[182]. - The company incurred a net loss of RMB 197,458,000 for the year, compared to a profit of RMB 113,309,000 in 2017, marking a significant shift in performance[182]. - Total assets increased to RMB 17,606,786,000 as of December 31, 2018, compared to RMB 12,895,511,000 in 2017, representing a growth of approximately 36.5%[191]. - The company's total liabilities increased to RMB 8,290,397,000 from RMB 3,115,771,000, reflecting a significant increase of about 165.5%[191]. - The company reported a basic loss per share of RMB 0.08 for the year, compared to earnings per share of RMB 0.04 in 2017[182]. - The fair value gain from investment properties was RMB 262,497,000, compared to RMB 222,394,000 in the previous year, showing an increase of approximately 18%[182]. Operational Expansion - In 2018, the company expanded its operations by opening new outlets in Qingdao, Nanning, and Xiamen, increasing its total managed outlets to 17[13]. - The newly opened Wuhan, Hefei, and Zhengzhou outlets achieved strong sales during their opening periods, with monthly sales exceeding RMB 100 million[14]. - The company is actively pursuing market expansion with new outlet projects planned for cities like Nanning and Xiamen, expected to open in 2021[27]. - The total revenue from opened outlet stores reached over RMB 5.1 billion, representing a year-on-year growth of 58%[31]. - The annual visitor count reached 31.2 million, marking a 23% increase compared to the previous year[31]. Strategic Initiatives - The company’s strategic cooperation with Luneng Group aims to manage the Dalian Jinshitan project, enhancing its management capabilities[12]. - The company plans to enhance its digital transformation and improve operational efficiency through a comprehensive digital platform, aiming to meet personalized consumer needs[16]. - The company is focusing on expanding its property management capabilities and transitioning from a "developer operator" to a "large asset management platform"[15]. - The company aims to create a new retail benchmark in the outlet industry by leveraging online and offline channel integration[16]. - The company emphasizes the importance of consumer data asset management to drive traffic and enhance customer retention and conversion rates[16]. Financial Management - The company successfully issued USD 400 million floating rate guaranteed notes due in 2021[9]. - The company successfully captured a significant opportunity in asset securitization, securing the first domestic issuance of a commercial property asset-backed plan worth over RMB 10 billion[15]. - The group reported no dividend distribution for the year ended December 31, 2018[73]. - The company has bank borrowings of approximately RMB 5,648,474,000, an increase from RMB 3,205,000,000 as of December 31, 2017[42]. - The net capital debt ratio was 90% as of December 31, 2018, compared to 47% in 2017, reflecting an increase in total debt[38]. Corporate Governance - The board of directors consists of nine members, including two executive directors, four non-executive directors, and three independent non-executive directors[123]. - The company has established a strategic investment committee, nomination committee, and remuneration committee to enhance governance[122]. - The company has maintained good corporate governance standards and effective risk management, believing that robust governance is the cornerstone of long-term success[120]. - The company has committed to transparency and accountability to all shareholders[120]. - The company has adopted a series of procedures for shareholders to propose candidates for the board of directors at the annual general meeting[151]. Market Environment - The retail environment in China showed signs of improvement, with a 6.6% GDP growth and a 9.0% increase in total retail sales of consumer goods in 2018[29]. - The group anticipates that the commercial real estate market will face significant downward pressure in 2019, necessitating adaptation to changing consumer demands[47]. - The retail industry is expected to continue rapid development, with a focus on innovation and technology to enhance competitiveness in the market[48]. Risk Management - The group faced strategic, market, operational, financial, and legal risks, impacting overall performance and decision-making[71]. - The company has established a comprehensive risk management system, which includes risk identification, risk measures, internal audit evaluation, and continuous improvement[145]. - The Risk Control Center assessed the company's risk management and internal control, concluding that there are no significant weaknesses in internal controls[146].