Financial Performance - The group's revenue for 2023 was RMB 611 million, up 13.6% from RMB 537.5 million in 2022[34]. - Revenue for the year ended December 31, 2023, was RMB 610.6 million, an increase from RMB 537.5 million in the previous year, representing a growth of approximately 13.6%[61]. - Total revenue for the year ended December 31, 2023, was RMB 610,619,000, an increase from RMB 537,510,000 in 2022, representing a growth of approximately 13.6%[101]. - The group reported a significant increase in franchise income, which rose to RMB 13,724,000 in 2023 from RMB 4,905,000 in 2022, marking an increase of approximately 179.5%[104]. - Government grants received increased to RMB 11,647,000 in 2023, compared to RMB 1,645,000 in 2022, reflecting a growth of approximately 608.5%[104]. Losses and Adjusted Loss - The company recorded a loss attributable to equity holders of approximately RMB 151.7 million for the year ended December 31, 2023, compared to a loss of RMB 156.2 million for the year ended December 31, 2022[48]. - The adjusted loss for the year was RMB (53,406,000), significantly improved from RMB (102,983,000) in the previous year, indicating a reduction in losses by about 48%[72]. - The loss attributable to equity holders for the year was RMB (162,695,000), slightly better than RMB (166,708,000) in 2022, with a diluted loss per share of RMB (9.61) compared to RMB (9.90) in the prior year[72][77]. Cash Flow and Liquidity - The company's ability to generate sufficient cash flow from operations is expected to support its financial obligations over the next 12 months[92]. - The current ratio as of December 31, 2023, was 0.68, slightly up from 0.67 in the previous year, indicating improved short-term liquidity[55]. Assets and Liabilities - Total assets as of December 31, 2023, amounted to RMB 1,108.4 million, down from RMB 1,343.4 million as of December 31, 2022, indicating a decrease of approximately 17.5%[68]. - Total liabilities decreased to RMB 1,061,608,000 in 2023 from RMB 1,132,748,000 in 2022, reflecting a reduction of approximately 6.3%[81]. - Current assets were RMB 201.6 million as of December 31, 2023, compared to RMB 226.5 million as of December 31, 2022, reflecting a decline of about 11%[55]. Employee and Workforce Changes - The workforce decreased to approximately 1,779 employees as of December 31, 2023, down from approximately 2,162 employees in 2022[16]. - Employee benefits expenses grew by 0.9% to RMB 174.6 million, decreasing as a percentage of revenue from 32.2% in 2022 to 28.6% in 2023[38]. Operational Efficiency and Digital Transformation - The group is focusing on digital operations to enhance efficiency and resource sharing among its brands[32]. - The company focused on enhancing operational efficiency and customer experience through digital transformation initiatives in 2023[75]. - The company plans to leverage its digital capabilities and scale to maintain a competitive edge in the restaurant industry[146]. Debt and Borrowings - As of December 31, 2023, the company had outstanding borrowings of RMB 11.0 million, down from RMB 14.8 million as of December 31, 2022[7]. - The company's debt-to-equity ratio was 92% as of December 31, 2023, up from 72% as of December 31, 2022[14]. - Financial expenses decreased by 9.0% to RMB 47.2 million, primarily due to lower convertible bond interest and reduced lease liabilities[44]. Impairment and Asset Valuation - The carrying value of trademarks declined by 20.3% from RMB 468.3 million on December 31, 2022, to RMB 373.0 million on December 31, 2023, due to an impairment loss of RMB 95.3 million recognized in 2023[126]. - Impairment loss for the trademark of the new brand is recognized at RMB 95.3 million as of December 31, 2023, compared to none in 2022[159]. Compliance and Governance - The company has maintained compliance with the corporate governance code throughout the year ended December 31, 2023[20]. Future Outlook - The company anticipates continued growth in the franchising business and aims to enhance brand value to contribute to profitability[146]. - The company plans to focus on franchise development as a strategic initiative and enhance digital operational capabilities[59].

6 收入及分部資料 | --- | --- | --- | --- | --- | |--------------------------|----------|-------|--------------------------------------------------------------------------------------------------|----------------------------------------------------------------| | | | | Six months ended 30 June 截至 6 月 30 \n2023 \nRMB'000 千人民幣 (Unaudited) （未經審核） | 日止 6 個月 \n2022 \nRMB'000 千人民幣 (Unaudited) （未經審核） | | Restaurant operation | 餐廳經營 | | 168,760 | 158,979 | | Delivery business | 外賣業務 | | 104,458 | 89,113 | | Sale of food in ...

Financial Position - As of June 30, 2023, the group's current liabilities exceeded its current assets by RMB 96,209,000[1]. - The total equity of the group as of June 30, 2023, was RMB 196.3 million, down from RMB 210.6 million as of December 31, 2022[33]. - The group's current assets were RMB 218.8 million as of June 30, 2023, compared to RMB 226.5 million as of December 31, 2022[33]. - The current ratio as of June 30, 2023, was 0.69, slightly improved from 0.67 as of December 31, 2022[33]. - The group had cash and cash equivalents of RMB 36.3 million as of June 30, 2023, up from RMB 34.1 million as of December 31, 2022[34]. - The group had outstanding bank borrowings of RMB 12.0 million as of June 30, 2023, down from RMB 14.8 million as of December 31, 2022[34]. - The group had no assets pledged as collateral as of June 30, 2023, compared to RMB 22.2 million in collateralized assets as of December 31, 2022[17]. - The total liabilities, including trade payables and other payables, decreased from RMB 167.980 million as of December 31, 2022, to RMB 160.925 million as of June 30, 2023[59]. - The company's debt-to-equity ratio was 74%, up from 72% on December 31, 2022[145]. Revenue and Sales Performance - The total system sales for the first half of 2023 reached RMB 1,770 million, representing a 44% increase compared to the same period in 2022[66]. - The group's revenue for the first half of 2023 was RMB 305 million, an increase of 13.8% year-on-year[66]. - The group's revenue for the six months ended June 30, 2023, was RMB 305.2 million, an increase of 13.9% compared to RMB 268.1 million for the same period in 2022[99]. - Restaurant operating revenue rose from RMB 159.0 million in the first half of 2022 to RMB 168.8 million in 2023, an increase of 6.2%[70]. - The takeaway business revenue grew from RMB 89.1 million in the first half of 2022 to RMB 104.5 million in 2023, marking a 17.3% increase, attributed to the lifting of COVID-19 restrictions[70]. - Revenue from restaurant operations increased to RMB 168,760 thousand, up 6.3% from RMB 158,979 thousand in the prior year[135]. - The takeaway business generated revenue of RMB 104,458 thousand, representing a 17.2% increase from RMB 89,113 thousand in the same period last year[135]. - The total revenue for the period reached RMB 305,248 thousand, a 13.8% increase compared to RMB 268,104 thousand in the previous year[135]. Profitability and Loss - Adjusted profit for the period was RMB 12.7 million, compared to a loss of RMB 67.7 million in the same period last year[80]. - The net loss for the period decreased significantly to RMB 5.7 million from RMB 107.3 million year-on-year, mainly due to the recovery of restaurant operations[75]. - The group reported a net loss attributable to equity holders of the company of RMB 8.6 million for the period, compared to a loss of RMB 100.9 million in the same period last year[101]. - The company reported a total comprehensive loss of RMB 15,100 thousand for the period, compared to a loss of RMB 117,717 thousand in the same period last year[128]. - The adjusted profit for the period was a loss of RMB 5.7 million, significantly improved from a loss of RMB 107.3 million in the same period last year[99]. Expenses and Financial Management - Employee benefits expenses increased slightly from RMB 85.6 million to RMB 86.6 million, a rise of 1.2%, but as a percentage of revenue, it decreased from 31.9% to 28.4%[71]. - Depreciation of right-of-use assets decreased by 25.9% from RMB 48.3 million to RMB 35.8 million, reflecting a reduction in the percentage of revenue from 18.0% to 11.7%[71]. - Financial expenses for the six months ended June 30, 2023, were RMB 4.8 million, down from RMB 7.2 million in the previous year[99]. - The total expenses for the six months ended June 30, 2023, amounted to RMB 24,820,000, an increase from RMB 23,700,000 in the same period of 2022[155]. Investments and Capital Expenditures - The group reported no significant investments or capital asset plans as of the announcement date[23]. - There were no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the six months ended June 30, 2023[52]. Operational Developments - The number of stores under the group and its associates reached 967 as of June 30, 2023, with nearly 100 new direct-operated and franchised stores opened since December 31, 2022[66]. - The group expanded its franchise partnerships in new regions such as Shandong, Jiangsu, Zhejiang, and Fujian during the first half of 2023[67]. - The digital team focused on upgrading self-developed systems to enhance operational efficiency across multiple brands within the group[68]. - The group provided value-added services to affiliated brands, contributing positively to financial performance in the first half of 2023[69]. - The company aims to expand its franchise network and enhance services to franchisees as part of its strategic initiatives[98]. - The company aims to enhance digital development and operational capabilities as part of its future strategy[125]. Other Financial Information - The group had total accounts receivable and other receivables amounted to RMB 105.198 million as of June 30, 2023, compared to RMB 103.480 million as of December 31, 2022[55]. - Inventory increased from RMB 24.2 million as of December 31, 2022, to RMB 25.8 million as of June 30, 2023, with inventory turnover days decreasing from 52 days to 40 days[94]. - Total lease liabilities decreased by 26.3% from RMB 218.2 million as of December 31, 2022, to RMB 160.9 million as of June 30, 2023, due to rental payments and the closure of some stores[97]. - The initial fair value of derivative financial instruments was RMB 46,631,000, recognized as shareholder contributions[160]. - The company has not entered into any forward contracts to hedge foreign exchange risks as of June 30, 2023[147]. - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange regulations during the reporting period[163]. - The company's financial statements were prepared based on historical cost, with certain financial assets measured at fair value[152].

Business Recovery and Market Outlook - Best Food Group experienced significant challenges in 2022 due to the COVID-19 pandemic, leading to rigorous "stress testing" of its brands[15]. - The company reported a recovery in consumer sentiment following the adjustment of China's pandemic-control policy in December 2022, allowing for rapid business recovery[15]. - The catering industry is gradually recovering, and the company is confident in the long-term potential of the Chinese catering market[22]. - Many of the Group's brands have strengthened their foundations during market testing and are poised for growth in the coming years[22]. - The Board anticipates that several brands will enter a rapid growth stage within the next three years, contributing significant value to the Group's performance[22]. Financial Performance - The Group's revenue for 2022 was RMB 537.5 million, representing a year-on-year decrease of 28.6% compared to 2021[32]. - Total system sales for the Group amounted to RMB 2,670 million in 2022, reflecting a year-on-year increase of 5.1%[32]. - Revenue decreased by 28.6% from RMB 753.0 million in 2021 to RMB 537.5 million in 2022, with restaurant operations revenue dropping by 43.6% from RMB 500.9 million to RMB 282.5 million due to pandemic impacts[42]. - The Group recorded a loss for the year attributable to equity holders of approximately RMB 156.2 million, a decrease from a loss of RMB 639.6 million for the year ended 31 December 2021[53]. - The total loss for the year amounted to RMB (166,708) thousand, compared to RMB (651,837) thousand in the prior year, showing a reduction in overall losses[63]. Membership and Customer Engagement - The number of members in the Group increased from approximately 16.0 million at the beginning of the year to approximately 23.0 million by the end of 2022[33]. - The group’s membership and points program grew from approximately 16.0 million to 23.0 million members during the year[38]. - The amount of revenue recognized from the customer loyalty program is determined based on the number of points redeemed relative to the total number expected to be redeemed[4]. Digital Transformation and Technology - Best Food is committed to leveraging technology to enhance its food and beverage operations, achieving tangible progress in building digital-driven platform capabilities[20]. - The digital team developed a smart cashier system, mobile app ordering system, and membership management system, enhancing operational efficiency across multiple brands[41]. - The intelligent delivery system was preliminarily formed, providing timely support for operational decision-making through data dashboards[41]. Franchising and Expansion - The Group actively expanded its franchising network, focusing on cross-regional franchisees to promote brand presence beyond local communities[32]. - "Yujian Xiaomian" solidified its presence in the Beijing market and opened stores at transportation hubs in various cities[32]. - "King of Clay Pot" expanded its franchising model into new regions including Jiangsu, Anhui, Zhejiang, Fujian, and Sichuan, with over 70 stores outside Beijing by the end of 2022[32]. - The Group established a franchise expansion team to facilitate cross-region development and entered into strategic cooperation agreements with national commercial property enterprises[35]. Cost Management and Expenses - Employee benefit expense decreased by 20.6% from RMB217.9 million for the year ended 31 December 2021 to RMB173.0 million for the corresponding period of 2022, while the percentage of revenue increased from 28.9% to 32.2%[50]. - Depreciation of right-of-use assets decreased by 18.1% from RMB103.4 million for the year ended 31 December 2021 to RMB84.7 million for the corresponding period of 2022, with the percentage of revenue increasing from 13.7% to 15.8%[50]. - Property rentals and other related expenses decreased by 41.8% from RMB32.3 million for the year ended 31 December 2021 to RMB18.8 million for the corresponding period of 2022, with the percentage of revenue decreasing from 4.3% to 3.5%[51]. - Other expenses decreased by 42.5% from RMB95.8 million for the year ended 31 December 2021 to RMB55.1 million for the corresponding period of 2022, with the percentage of revenue decreasing from 12.7% to 10.3%[51]. Financial Risk Management - The Group's financial risk management focuses on minimizing potential adverse effects on financial performance due to market risks, credit risks, and liquidity risks[84]. - The Group's activities expose it to various financial risks, including market risk, credit risk, and liquidity risk, which are managed by the finance department[84]. - The Group's risk management policies are approved by the Board of Directors and cover specific areas such as foreign exchange risk and credit risk[84]. Leadership and Governance - The Company held an annual general meeting on 2 June 2022, allowing shareholders to communicate their views with the chairman of the Board[180]. - The Company has maintained sufficient contact details for shareholders to put forward inquiries to the Board[180]. - Corporate communications were published on the websites of the Company and the Stock Exchange in a timely manner[180]. Strategic Initiatives - The Group plans to enhance digital development and operation capabilities to improve performance and create shareholder value[68]. - The Group aims to develop and better serve franchisors as part of its future growth strategy[69]. - The Group will facilitate the increase in values of brands and enterprises it invests in, contributing profits to the Company[70].

Franchise and Brand Development - The company's franchise empowerment strategy has led to the establishment of a multi-brand franchise network across multiple regions, with strategic agreements signed with national commercial real estate companies in 2022[2] - The company completed two angel round investments in 2022, including the hot pot brand "Zhao Cai Feng Zhua" and the small hot pot brand "Panda Tang," contributing to the valuation growth of its portfolio companies[3] - The company plans to focus on enhancing digital development and operational capabilities, as well as supporting franchisees and increasing the value of invested brands[50] - The company expanded its presence in new regions, with brands like "Meet the Noodles" and "Baozai King" achieving breakthroughs in multiple cities and markets[182] Membership and Digital Growth - The company's membership base grew from 16.0 million at the beginning of the year to 23.0 million by the end of 2022, driven by multi-channel traffic empowerment strategies including live streaming, short video content, and community marketing[2] - The company's digital team developed lightweight POS systems, mini-program ordering systems, and membership management systems, which are being rolled out across multiple brands[180] - The company's smart delivery system and franchise management big data system were established to enhance operational decision-making and support franchise business growth[183] Financial Performance and Losses - Revenue for 2022 decreased to RMB 537.51 million from RMB 752.96 million in 2021, a decline of 28.6%[38] - Net loss for 2022 was RMB 166.71 million, compared to a net loss of RMB 651.84 million in 2021, showing a significant improvement[38] - The adjusted loss for the year was RMB 102.983 million, compared to a loss of RMB 166.708 million in 2022 and RMB 651.837 million in 2021, with significant contributions from convertible bond interest and derivative financial instrument fair value changes[11] - Total comprehensive loss for the year attributable to equity holders of the company was RMB 180,757 thousand, compared to RMB 640,496 thousand in the previous year[56] - Basic loss per share attributable to equity holders of the company was RMB 9.90 cents, compared to RMB 40.52 cents in the previous year[57] - Total comprehensive loss for the year was RMB 191,366 thousand, compared to RMB 652,694 thousand in the previous year[68] - The company reported a net loss per share of 9.90 RMB in 2022, an improvement from 40.52 RMB in 2021[92] - The company's basic loss per share for 2022 was RMB (156,242) thousand, compared to RMB (639,639) thousand in 2021[117] - Net loss attributable to equity holders of the company improved to RMB 156.2 million in 2022 from RMB 639.6 million in 2021, primarily due to the absence of impairment losses on goodwill and other intangible assets in 2022[176] Financial Expenses and Liabilities - Financial expenses increased by 8.1% from RMB 48.0 million in 2021 to RMB 51.9 million in 2022, primarily due to increased convertible bond interest, partially offset by reduced lease liability interest from store closures[10] - The company's lease liabilities decreased by 23.2% from RMB 284.1 million in 2021 to RMB 218.2 million in 2022, mainly due to rental payments and partial store closures[18] - The company extended the maturity date of its convertible bonds to the seventh anniversary of the issuance date, from November 23, 2023, to November 23, 2025, with investor consent[22] - Convertible bonds and related interest increased to RMB 548.4 million in 2022 from RMB 502.1 million in 2021, a rise of 9.2%[48] - Short-term borrowings stood at RMB 14.8 million in 2022, slightly down from RMB 15.0 million in 2021[52] - The maturity date of convertible bonds was extended from November 23, 2023, to November 23, 2025, with an adjusted carrying amount of RMB 481,787,000[156] - The carrying amount of convertible bonds as of December 31, 2022, was RMB 16,366,000 for the current portion and classified as non-current liabilities for the remaining balance[160] Revenue and Income Breakdown - Revenue from customer contracts primarily comes from the Chinese market, with overseas sales contributing less than 10% of total revenue[65] - Total revenue for the year ended December 31, 2022, was 9,874 thousand RMB, a decrease from 18,085 thousand RMB in 2021[79] - Franchise income decreased to 4,905 thousand RMB in 2022 from 6,182 thousand RMB in 2021[79] - Government subsidies dropped significantly to 1,645 thousand RMB in 2022 from 4,331 thousand RMB in 2021[79] - Loss from restaurant closures amounted to 1,528 thousand RMB in 2022[81] - The company recorded a deferred tax benefit of 15,518 thousand RMB in 2022, compared to 20,059 thousand RMB in 2021[85] - Income tax credits increased from RMB 13.8 million in 2021 to RMB 15.5 million in 2022 due to increased losses that can be carried forward to future years[186] Asset and Liability Management - Inventory decreased from RMB 35.2 million in 2021 to RMB 24.2 million in 2022, a reduction of 31.3%[46] - Trade and other receivables decreased by 9.9% from RMB 100.2 million in 2021 to RMB 90.3 million in 2022[47] - Trade and other payables decreased from RMB 178.8 million in 2021 to RMB 168.0 million in 2022, a decline of 6.0%[47] - Right-of-use assets decreased to RMB 188.4 million in 2022 from RMB 274.0 million in 2021, a reduction of 31.2%[45] - Total assets decreased to RMB 1,343,356 thousand from RMB 1,520,296 thousand year-over-year[70] - Current liabilities exceeded current assets by RMB 113,082 thousand as of December 31, 2022[77] - Property, plant, and equipment decreased to RMB 80,140 thousand from RMB 99,195 thousand year-over-year[70] - Cash and cash equivalents decreased to RMB 34,097 thousand from RMB 62,571 thousand year-over-year[70] - The group's asset-to-liability ratio increased to 72% in 2022 from 56% in 2021, calculated as net debt divided by total capital[194] - Trade payables decreased from RMB 59.166 million in 2021 to RMB 53.855 million in 2022, with related party payables increasing from RMB 6.608 million to RMB 7.604 million[192] Operational Costs and Expenses - Employee benefit expenses decreased by 20.6% from RMB 217.9 million in 2021 to RMB 173.0 million in 2022, primarily due to reduced working hours during pandemic lockdowns[155] - Right-of-use asset depreciation decreased by 18.1% from RMB 103.4 million in 2021 to RMB 84.7 million in 2022, mainly due to the closure of underperforming restaurants[155] - Property rental expenses for office space decreased to 442 thousand RMB in 2022 from 1,627 thousand RMB in 2021[90] - Restaurant rental expenses (fixed payments) decreased to 7,033 thousand RMB in 2022 from 9,231 thousand RMB in 2021[90] - COVID-19 related rental concessions amounted to 5,890 thousand RMB in 2022, compared to 921 thousand RMB in 2021[90] - Depreciation and amortization expenses totaled 112,296 thousand RMB in 2022, down from 144,641 thousand RMB in 2021[102] - Raw materials and inventory costs decreased by 27.7% to RMB 208.1 million in 2022 from RMB 288.0 million in 2021, mainly due to reduced store operations during the pandemic[165] - Online platform service fees and delivery fees increased by 4.0% to RMB 38.6 million in 2022, accounting for 18.6% of delivery business revenue, up from 18.0% in 2021[166] - Other asset depreciation and amortization decreased by 33.0% to RMB 27.6 million in 2022, accounting for 5.1% of revenue, down from 5.5% in 2021[174] - Property rental and related expenses decreased by 41.8% to RMB 18.8 million in 2022, accounting for 3.5% of revenue, down from 4.3% in 2021, due to pandemic-related rent concessions and store closures[174] - Other expenses decreased by 42.5% from RMB 95.8 million in 2021 to RMB 55.1 million in 2022, primarily due to reduced maintenance costs (RMB 7.6 million) and advertising expenses (RMB 7.3 million)[185] Impairment and Valuation - The goodwill and trademarks of Hehegu Group and Xindao Group were subject to impairment review due to lower-than-expected operating performance in 2022, impacted by the COVID-19 pandemic[111] - Hehegu Group's recoverable amount as of December 31, 2022, was approximately RMB 432 million, 25.7% higher than its carrying amount[122] - Xindao Group's recoverable amount was determined using the fair value less costs to sell method, with no impairment identified as of December 31, 2022[126] - The company recognized a total impairment loss of RMB 646.463 million, primarily related to goodwill and identifiable net assets[130] - Goodwill impairment amounted to RMB 535,436 thousand, with a total impairment of RMB 566,455 thousand[134] - The fair value less costs to sell of Xinladao Group was RMB 249 million, 11.1% higher than its carrying amount[138] - Impairment losses recognized in 2021 amounted to RMB 646.463 million[191] - Goodwill impairment of RMB 535.436 million was recognized in the comprehensive income statement, with RMB 31.019 million allocated to trademarks with indefinite useful lives[199] Investment and Financing - The company initiated the development of a big data platform and business intelligence (BI) analysis system, marking the beginning of its intelligent data platform construction[4] - The weighted average annual interest rate for bank loans decreased from 4.35% in 2021 to 4.01% in 2022[28] - The company's partial disposal and dilution of investments in associates resulted in a net gain of RMB 82.041 million in 2021[114] - The group entered into a 2020 investment agreement for the issuance of convertible bonds with a total principal amount not exceeding HKD 780 million[200] System-wide Sales and Store Operations - System-wide sales for 2022 increased by 5.1% to RMB 2,670 million, with the total number of stores reaching 878, including over 160 new directly operated and franchised stores[182] - Group revenue decreased by 28.6% from RMB 753.0 million in 2021 to RMB 537.5 million in 2022, with restaurant operating revenue dropping by 43.6% from RMB 500.9 million to RMB 282.5 million due to pandemic-related store closures and suspended dine-in services[184] Credit and Provisions - The group's expected credit loss provision decreased from RMB 406 thousand in 2021 to RMB 361 thousand in 2022, with provisions of RMB 177 thousand made during the year[189] - The group had no significant contingent liabilities as of December 31, 2022, and no committed capital expenditures for property, plant, and equipment not included in the financial statements[196] Miscellaneous - No dividends were declared for the year ended December 31, 2022, consistent with the previous year[27] - The company's main business is chain catering operations[76] - The company's liquidity depends on its ability to maintain sufficient operating cash inflows and adequate financing to meet its financial obligations[77] - The total goodwill as of December 31, 2021, was RMB 615,444 thousand[141] - The fair value of derivative financial instruments at the initial recognition date was RMB 46,631,000, recognized as a capital contribution and included in equity as a special reserve[146] - Trade and other receivables as of December 31, 2022, amounted to RMB 13,376 thousand, with RMB 934 thousand from related parties and RMB 12,803 thousand from third parties[148] - Revenue for 2022 decreased by 28.6% to RMB 537.5 million compared to RMB 752.9 million in 2021[161] - Basic loss per share was -19[133]

Store Expansion and Sales Growth - As of June 30, 2022, the total number of direct-sale and franchised stores exceeded 800, with 537 direct-sale stores and 267 franchised stores, a significant increase from approximately 700 as of December 31, 2021[24]. - For the six months ended June 30, 2022, the Group's total system sales increased by 13.4% to RMB1,230 million, up from RMB1,084.5 million for the same period in 2021[25]. - The Group's operational empowerment strategy has led to a notable increase in store numbers, reflecting growth in market presence[24]. - The number of members increased from approximately 16.0 million at the beginning of the year to approximately 20.0 million[34]. - Best Food's franchise partners expanded significantly, with multiple new stores opened in Jiangsu and other provinces[34]. Financial Performance - Best Food's revenue decreased by 27.6% from RMB 370.2 million in the first half of 2021 to RMB 268.1 million in the corresponding period of 2022[39]. - Revenue from restaurant operations fell by 36.5% from RMB 250.4 million in the first half of 2021 to RMB 159.0 million in the same period of 2022[39]. - Revenue from delivery business decreased by 9.6% from RMB 98.6 million in the first half of 2021 to RMB 89.1 million in the corresponding period of 2022[39]. - The Group recorded a loss for the period of approximately RMB107.3 million for the six months ended June 30, 2022, compared to a profit of RMB1.2 million for the six months ended June 30, 2021[53]. - The company reported a loss for the period of RMB 107.3 million in 2022, compared to a profit of RMB 1.2 million in 2021[58]. - Adjusted loss for the period was RMB 67.7 million, a significant decline from the adjusted profit of RMB 15.4 million in the previous year[58]. - EBITDA for the first half of 2022 was negative at RMB 22.7 million, down from RMB 99.6 million in the same period of 2021[65]. - The total comprehensive loss for the period was RMB 117,717,000, significantly down from a total comprehensive income of RMB 1,534,000 in the prior year[198]. - The basic and diluted loss per share attributable to equity holders of the company was RMB (6.39) for the six months ended June 30, 2022, compared to earnings of RMB 0.33 in the same period of 2021[198]. Operational Strategies and Adaptations - The Company is focusing on developing a digital-based and multi-brand food and beverage platform while ensuring sufficient cash flows and sustainable operations[23]. - Best Food is actively mitigating the impact of the COVID-19 pandemic on the catering industry through operational, digital, and investment empowerment[23]. - The Company has noted phased progress in enhancing its core capabilities despite the short-term pressures from the pandemic[23]. - The pandemic has significantly impacted the catering industry, prompting the Company to adapt its strategies accordingly[23]. - Best Food continues to explore new opportunities for expansion and improvement in its service offerings[23]. - The Company aims to leverage limited resources effectively to enhance operational capabilities and drive growth[23]. - The Company plans to focus on franchise business development, digital system promotion, operational efficiency improvement, and investment empowerment[76]. Cost Management and Expenses - Raw material used and changes in inventories of finished goods decreased by 25.9% from RMB149.3 million for the six months ended 30 June 2021 to RMB110.6 million for the corresponding period of 2022[45]. - Online platform service charges and delivery fees decreased by 17.1% from RMB21.1 million for the six months ended 30 June 2021 to RMB17.5 million for the corresponding period of 2022[45]. - Employee benefit expense decreased by 22.5% from RMB110.5 million for the six months ended 30 June 2021 to RMB85.6 million for the corresponding period of 2022[45]. - Depreciation of right-of-use assets decreased by 8.0% from RMB52.5 million for the six months ended 30 June 2021 to RMB48.3 million for the corresponding period of 2022[45]. - Depreciation and amortisation of other assets decreased by 34.8% from RMB20.7 million for the six months ended 30 June 2021 to RMB13.5 million for the corresponding period of 2022[48]. - Property rentals and other related expenses decreased by 34.5% from RMB13.9 million for the six months ended 30 June 2021 to RMB9.1 million for the corresponding period of 2022[48]. - Other expenses decreased by 25.5% from RMB31.8 million for the six months ended 30 June 2021 to RMB23.7 million for the corresponding period of 2022[48]. - Finance expenses remained unchanged at RMB23.0 million for both the six months ended 30 June 2021 and 2022[48]. Assets and Liabilities - As of June 30, 2022, the Group's total shareholders' equity was RMB239.2 million, down from RMB355.4 million as of December 31, 2021[76]. - The Group's current assets were RMB243.2 million, while current liabilities were RMB406.1 million, resulting in a current ratio of 0.60 as of June 30, 2022, compared to 0.69 as of December 31, 2021[76]. - Total assets decreased from RMB 1,520,296,000 as of December 31, 2021, to RMB 1,401,378,000 as of June 30, 2022, representing a decline of approximately 7.8%[200]. - Non-current assets decreased from RMB 1,229,349,000 to RMB 1,158,186,000, a reduction of about 5.8%[200]. - Current assets decreased from RMB 290,947,000 to RMB 243,192,000, reflecting a decline of approximately 16.4%[200]. - Cash and cash equivalents, including restricted cash, decreased from RMB 62,571,000 to RMB 28,086,000, a significant drop of about 55.1%[200]. - Trade and other receivables decreased by 3.3% from RMB 100.2 million as of December 31, 2021, to RMB 96.9 million as of June 30, 2022[70]. - Inventories decreased from RMB 35.2 million as of December 31, 2021, to RMB 30.3 million as of June 30, 2022, reflecting a slowdown in inventory turnover from 43 days to 54 days[70]. Share Capital and Corporate Governance - As of June 30, 2022, the company had 1,578,664,000 shares in issue[2]. - Sonic Tycoon Limited held 1,183,998,000 shares and had beneficial interest in convertible bonds amounting to HK$610,676,480, convertible into 517,522,440 shares at an initial conversion price of HK$1.18 per share[3]. - The company did not purchase, sell, or redeem any of its listed securities during the six months ended June 30, 2022[173]. - The company complied with the Corporate Governance Code throughout the reporting period[174]. - The unaudited interim results for the reporting period were reviewed by the audit committee, which includes all independent non-executive directors[176]. - All directors confirmed compliance with the Model Code for Securities Transactions throughout the reporting period[175]. Future Outlook and Growth Potential - The Directors believe there is still significant growth potential in the catering industry in China despite recent fluctuations[73]. - The company has been exploring business development through acquisitions and/or expansion of existing business, evaluating its financial position and resources for potential long-term funding[193].

Industry Recovery and Challenges - The food and beverage industry did not fully recover to pre-pandemic conditions in 2021, facing challenges from pandemic resurgence and oversupply[20]. - In the first quarter of 2022, the food and beverage industry is expected to face a reshuffle, presenting both challenges and opportunities for the Group[27]. - The performance of the Xinladao Group for the year ended December 31, 2021, was below management's forecast due to the impact of COVID-19[69]. Digital Transformation and Operational Efficiency - The Group is committed to transitioning towards a digital multi-brand operating platform to enhance operational and investment management capabilities[20]. - Digital operations improved efficiency and allowed the Group to better understand customer needs, leading to the development of favored products[20]. - Best Food has developed a one-stop smart cashier system and order-via-mobile-app system during 2021, enhancing operational efficiency[44]. - The Group aims to enhance its capabilities in investment management, operations, and digitalization to build a unique restaurant ecosystem platform[27]. - The company aims to enhance management and operational efficiency comprehensively through the development of a business data analysis system in 2022[42]. Franchise Development and Partnerships - The Group focused on developing a profitable franchise model and identified regional franchisees and real estate developers as partners[20]. - The franchise business strategy focuses on increasing channel development efficiency and establishing a franchise support system, with successful new product launches leading to satisfactory growth in single-store sales[35]. - Best Food plans to continue investing in refined management strategies, including customer-segmentation marketing and the development of an intelligent takeaway system in 2022[42]. - The franchise regions for Yujian Xiaomian have expanded to areas including Fujian, attracting employees to participate in the franchise business[41]. - The Group plans to expedite collaboration with capable regional franchisees to promote optimized store layouts[74]. Financial Performance and Revenue Growth - Revenue increased by 15.7% from RMB650.7 million in 2020 to RMB753.0 million in 2021, driven by the recovery of restaurant operations and increased delivery orders[48]. - Revenue from restaurant operations rose by 11.6% from RMB448.8 million in 2020 to RMB500.9 million in 2021, attributed to the easing of the COVID-19 pandemic[48]. - Delivery business revenue grew by 20.7% from RMB170.8 million in 2020 to RMB206.1 million in 2021, mainly due to an increase in the number of delivery orders[48]. - Raw material used and changes in inventories increased by 15.9% from RMB248.4 million in 2020 to RMB288.0 million in 2021, reflecting the recovery of restaurant operations[46]. Cost and Expense Management - Employee benefit expenses increased by 8.8% from RMB200.2 million in 2020 to RMB217.9 million in 2021, primarily due to increased staff working hours[53]. - Property rentals and other related expenses surged by 236.5% from RMB9.6 million in 2020 to RMB32.3 million in 2021, as a percentage of revenue increased from 1.5% to 4.3%[55]. - Other expenses rose by 24.1% from RMB77.2 million in 2020 to RMB95.8 million in 2021, reflecting the resumption of operations[56]. Losses and Impairments - The Group recorded a loss attributable to equity holders of approximately RMB 639.6 million for the year ended December 31, 2021, compared to a loss of RMB 140.9 million for the year ended December 31, 2020[61]. - Goodwill decreased by 92.2% from RMB 580.9 million as of December 31, 2020, to RMB 45.5 million as of December 31, 2021, primarily due to an impairment loss of RMB 535.4 million recognized in 2021[66]. - As of December 31, 2021, the Group recorded an impairment loss of goodwill and trademark amounting to RMB535 million and RMB31 million respectively[71]. Governance and Compliance - The Company has complied with the Corporate Governance Code throughout the year ended December 31, 2021[102]. - The Board consists of three executive Directors and three independent non-executive Directors, with independent Directors representing more than one-third of the Board[107]. - The Audit Committee, established in 2011, consists of three independent non-executive directors and meets regularly to review the Group's financial reporting and internal controls[121]. - The Company ensures that all Directors have full and timely access to information and can seek independent professional advice at the Company's expense[110]. Risk Management and Internal Controls - The system of risk management and internal controls is designed to assist the Group in identifying and managing significant risks while ensuring compliance with relevant laws and regulations[167]. - The Board is responsible for reviewing the effectiveness of the risk management and internal controls system to safeguard the interests of Shareholders[168]. - The Group has established an internal audit function to continuously review the effectiveness of the risk management and internal control systems[173]. Shareholder Engagement and Dividend Policy - The Company has adopted a dividend policy that allows for the distribution of dividends based on various factors including financial performance, capital requirements, and liquidity position[182]. - The annual general meeting serves as a platform for shareholders to raise comments and exchange views with the Board[189]. - Shareholders can requisition an extraordinary general meeting if they hold not less than one-tenth of the paid-up capital with voting rights[184]. Management Team and Experience - Mr. Wang has been the CEO since August 26, 2019, focusing on investments in the consumer and retail sector for over 18 years[196]. - The management team includes professionals with advanced degrees from prestigious institutions, enhancing the company's strategic capabilities[195][200]. - The company emphasizes investment in fast-moving consumer goods (FMCG) and catering sectors, indicating a strategic focus on these areas[196].

BEST FOC Stock Code 股份代號：1488 (Incorporated in the Cayman Islands with limited liability) (於開曼群島註冊成立之有限公司) Bear INTERIM REPORT 中 告 期 報 IT \\\\/ WI P CONTENTS 目錄 Corporate Information 公司資料 Management Discussion and Analysis 管理層討論及分析 Interim Condensed Consolidated Statement of Comprehensive Income 中期簡明綜合全面收益表 Interim Condensed Consolidated Balance Sheet 中期簡明綜合資產負債表 Interim Condensed Consolidated Statement of Changes in Equity 中期簡明綜合權益變動表 Interim Condensed Consolidated Statement of Cash Flow 中期簡明綜合現金流量表 Notes ...

BEST FO (Incorporated in the Cayman Islands with limited liability) (於開曼群島註冊成立之有限公司) Stock Code 股份代號：1488 ANNUAL RI 手机官 · 版 外部 STANNA ULT 8 restorious Li 0-11-1 armive E 195 8 7 G Corporate Information 公司資料 02 Chairman's Statement 主席報告 04 Management Discussion and Analysis 管理層討論與分析 08 21 Corporate Governance Report 企業管治報告 Profile of Directors and Senior Management 董事及高級管理層簡介 38 Directors' Report 董事會報告 44 Independent Auditor's Report 獨立核數師報告 63 Consolidated Statement of Comprehensive Income 綜合全面收益表 73 Consol ...

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