股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年8月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 美臻集團控股有限公 呈交日期: 2025年9月1日 I. 法定/註冊股本變動 FF301 II. 已發行股份及/或庫存股份變動 | 1. 股份分類 | 普通股 | | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01825 | 說明 | | | | | | | | | | 已發行股份（不包括庫存股份）數目 | | | 庫存股份數目 | | 已發行股份總數 | | | 上月底結存 | | | | 345,600,000 | | 0 | | 345,600,000 | | 增加 / 減少 (-) | | | | | | | | | | 本月底結存 | | | | 345,600,000 | | 0 | | 345,600,000 | 第 2 頁 共 10 頁 v 1.1.1 ...

股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年7月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 美臻集團控股有限公 呈交日期: 2025年8月4日 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | | 是 | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01825 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 2,500,000,000 | HKD | | 0.04 HKD | | | 100,000,000 | | 增加 / 減少 (-) | | | | | | HKD | | | | | 本月底結存 | | | 2,500,000,000 | HKD | | 0.04 HKD | | | 100,000,000 | 本月底法定/註冊股 ...

Sterling Group Holdings Limited 美臻集團控股有限公司* (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: 1825) NOTIFICATION LETTER 通知信函 31 July 2025 Dear Non-registered Shareholder(s)(Note 1), Sterling Group Holdings Limited (the "Company") The English and Chinese versions of the Company's Current Corporate Communications are available on the Company's website at www.sterlingapparel.com.hk and the website of The Stock Exchange of Hong Kong Limited (the "Stock E ...

Sterling Group Holdings Limited 美臻集團控股有限公司* (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: 1825) NOTIFICATION LETTER 通知信函 The English and Chinese versions of the Company's Current Corporate Communications are now available on the Company's website at www.sterlingapparel.com.hk and the website of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") at www.hkexnews.hk respectively (the "Website Version"). The Company strongly recommends yo ...

目錄 | 有關美臻集團 | 2 | | --- | --- | | 有關本報告 | 3 | | 可持續發展管治 | 4 | | 可持續發展管治架構 | 4 | | 美臻可持續發展委員會(SSC) | 5 | | 可持續發展理念 | 6 | | 可持續發展策略 | 6 | | 持份者參與 | 8 | | 可持續發展重要性評估 | 8 | | 地球－環境管理 | 10 | | 環境管理 | 10 | | 減碳措施要點 | 10 | | 氣候目標 | 12 | | 能源管理 | 13 | | 水資源管理 | 13 | | 使用材料 | 14 | | 廢棄物管理 | 14 | | Higg Index | 15 | | 氣候相關財務信息披露工作小組(TCFD) | 15 | | 管治 | 15 | | 策略 | 16 | | 風險管理 | 23 | | 指標及目標 | 24 | | 產品責任 | 24 | | 綠色採購及化學品管理 | 25 | | 人員－社會責任 | 26 | | 勞工實踐 | 26 | | 工作團隊結構及僱員流失率 | 26 | | 健康與安全管理 | 27 | | 培訓及發展 | 28 | | ...

（於開曼群島註冊成立之有限公司） （股份代號：1825） 適用於二零二五年股東週年大會（或其任何續會）之代表委任表格 本人╱吾等 （附註1） ， 地址為 ， 為美臻集團控股有限公司（「本公司」）股本中每股面值0.04港元普通股 （附註2） 之登記持有人，茲委任本公司股東週年大會主席或 （附註3） Sterling Group Holdings Limited 美臻集團控股有限公司* | | 普通決議案 | 贊成 | （附註5及6） | 反 對 | （附註5及6） | | --- | --- | --- | --- | --- | --- | | 1. | 省覽及採納本公司截至二零二五年三月三十一日止年度的經審核綜合 | | | | | | | 財務報表及本公司董事會報告與核數師報告。 | | | | | | 2. | 重選董事及釐定彼等酬金： | | | | | | | (a)重選蕭翊銘先生為執行董事。 | | | | | | | (b)重選楊倫先生為執行董事。 | | | | | | | (c)重選陳潔女士為獨立非執行董事。 | | | | | | | (d)重選高元元女士為獨立非執行董事。 | | | | ...

茲通告 美臻集團控股有限公司（「本公司」）謹訂於二零二五年九月二十九日（星 期 一）下午一時正假座香港九龍新蒲崗雙喜街9號匯達商業中心19樓舉行二零 二五年股東週年大會（「二零二五年股東週年大會」），以 考 慮 並 酌 情 通 過（無 論 有 否 作 出 修 訂）下 列 決 議 案： 香港交易及結算所有限公司及香港聯合交易所有限公司對本通告的內容概不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不 對 因 本 通 告 全部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責 任。 Sterling Group Holdings Limited 美臻集團控股有限公司* （於 開 曼 群 島 註 冊 成 立 之 有 限 公 司） （股 份 代 號：1825） 二零二五年股東週年大會通告 普通決議案 – 1 – 1. 省覽及採納本公司截至二零二五年三月三十一日止年度的經審核綜合財 務報表及本公司董事（「董 事」）會 報 告 與 核 數 師 報 告； 2. 重 選 董 事 及 釐 定 彼 等 酬 金： (a) 重 選 蕭 翊 銘 先 生 為 執 行 董 ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本通函之內容概不負 責，對其準確性或完整性亦不發表任何聲明，並明確表明概不就本通函全部或任 何部份內容而產生或因依賴該等內容而引致之任何損失承擔任何責任。 Sterling Group Holdings Limited 美臻集團控股有限公司* （於開曼群島註冊成立之有限公司） （股份代號：1825） 建 議 (1)採納經審核綜合財務報表 及董事會報告與核數師報告、 (2)重選退任董事、 (3)續聘核數師、 (4)發行股份及購回股份的一般授權 及 二零二五年股東週年大會通告 本公司謹訂於二零二五年九月二十九日（星期一）下午一時正假座香港九龍新蒲 崗雙喜街9號匯達商業中心19樓舉行二零二五年股東週年大會（「二零二五年股東 週年大會」），大會通告載於本通函第17至21頁。隨本通函附奉股東於二零二五年 股 東 週 年 大 會 上 使 用 的 代 表 委 任 表 格。該 代 表 委 任 表 格 亦 刊 登 於 香 港 聯 合 交 易 所有限公司的網站www.hkexnews.hk及本公司的網站www.sterlingapparel.com.hk。 此乃要件 請即處理 閣 ...

Company Information [Board Members and Committees](index=3&type=section&id=Board%20Members%20and%20Committees) The company's board comprises executive and independent non-executive directors, with audit, remuneration, and nomination committees; several directors and committee members changed during the reporting period. - Executive Director changes: Mr. Zhong Guowei, Mr. Liang Jiawei, and Mr. Ma Jian resigned, while Mr. Yang Lun was appointed[4](index=4&type=chunk) - Independent Non-Executive Director changes: Mr. Zeng Haoxian, Ms. Zhang Lingling, Mr. Zhao Chuan, and Mr. Zhou Runzhang resigned, while Ms. Chen Jie and Ms. Gao Yuanyuan were appointed[4](index=4&type=chunk) - Ms. Chen Jie chairs the Audit Committee, Ms. Gao Yuanyuan chairs the Remuneration Committee, and Ms. Wang Meihui chairs the Nomination Committee[4](index=4&type=chunk)[5](index=5&type=chunk) [Company Contact Information](index=3&type=section&id=Company%20Contact%20Information) The company's registered office is in the Cayman Islands, with its headquarters and principal place of business in Hong Kong; its website is http://www.sterlingapparel.com.hk, and its auditor is BDO Limited. - Registered Office: 3rd Floor, Century Yard, Cricket Square, P.O. Box 902, Grand Cayman KY1-1103, Cayman Islands[6](index=6&type=chunk) - Headquarters and Principal Place of Business in Hong Kong: 18-19/F, Vanta Industrial Centre, 9 Tai Yau Street, San Po Kong, Kowloon, Hong Kong[6](index=6&type=chunk) - Company Website: http://www.sterlingapparel.com.hk[7](index=7&type=chunk) - Auditor: BDO Limited[7](index=7&type=chunk) Financial Highlights [Overview of Operating Results](index=5&type=section&id=Overview%20of%20Operating%20Results) For the year ended March 31, 2025, revenue decreased by 16.4% to HKD 477,728 thousand, with improved gross profit margin, resulting in an operating loss and a narrowed net loss. Operating Results (HKD '000) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 477,728 | 571,391 | | Gross Profit | 87,531 | 91,377 | | Gross Profit Margin | 18.3% | 16.1% | | Selling and Distribution Costs | (20,668) | (24,315) | | General and Administrative Expenses | (53,294) | (52,657) | | Operating (Loss)/Profit | (1,309) | 7,442 | | Net Expected Credit Loss on Trade and Other Receivables | (4,834) | (25,802) | | Net Loss for the Year | (6,143) | (18,360) | | EBITDA excluding Expected Credit Loss | 22,330 | 5,034 | | EBITDA before Expected Credit Loss | 27,164 | 30,826 | - Revenue decreased by **16.4%** year-on-year, from **HKD 571,391 thousand** in 2024 to **HKD 477,728 thousand** in 2025[8](index=8&type=chunk) - Gross profit margin increased from **16.1%** in 2024 to **18.3%** in 2025[8](index=8&type=chunk) - Operating results shifted from a **profit of HKD 7,442 thousand** in 2024 to a **loss of HKD 1,309 thousand** in 2025[8](index=8&type=chunk) - Net loss for the year narrowed from **HKD 18,360 thousand** in 2024 to **HKD 6,143 thousand** in 2025[8](index=8&type=chunk) [Financial Position and Key Ratios](index=5&type=section&id=Financial%20Position%20and%20Key%20Ratios) As of March 31, 2025, cash and bank balances significantly decreased, total assets declined, but the debt-to-asset and debt-to-equity ratios improved, while current and quick ratios fell, indicating short-term solvency challenges. Financial Position (HKD '000) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Cash and Bank Balances | 14,710 | 26,965 | | Total Assets | 250,253 | 321,480 | | Net Assets Attributable to Owners | 30,505 | 27,329 | Key Ratios | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Loss Margin | (1.3%) | (3.2%) | | Loss Per Share (HK cents) | (2.17) | (7.65) | | Return on Total Assets | (2.5%) | (5.7%) | | Return on Average Total Equity | (21.2%) | (49.4%) | | Interest Coverage Ratio | -0.7 times | 0.6 times | | Current Ratio | 0.46 | 0.78 | | Quick Ratio | 0.36 | 0.69 | | Debt-to-Asset Ratio | 345.2% | 689.9% | | Debt-to-Equity Ratio | 297.0% | 591.3% | - Cash and bank balances decreased from **HKD 26,965 thousand** in 2024 to **HKD 14,710 thousand** in 2025[8](index=8&type=chunk) - Debt-to-asset ratio significantly decreased from **689.9%** in 2024 to **345.2%** in 2025, and the debt-to-equity ratio also fell from **591.3%** to **297.0%**[8](index=8&type=chunk) Chairman's Statement [Annual Results and Challenges](index=6&type=section&id=Annual%20Results%20and%20Challenges) For the year ended March 31, 2025, sales revenue decreased by 16.4% due to tighter credit policies for smaller clients and reduced sales to the largest client, leading to an operating loss despite improved gross margin, while net loss narrowed significantly due to reduced expected credit loss provisions. - Sales revenue was approximately **HKD 477,728,000**, a **16.4% decrease** from the previous year[10](index=10&type=chunk) - Sales decreased by approximately **HKD 93,663,000**, with **72.0%** attributed to smaller clients due to tighter credit policies and changes in purchasing strategies, and the remaining decrease from the largest client, representing **88%** of its revenue[10](index=10&type=chunk) - An operating loss of approximately **HKD 1,309,000** was recorded, compared to an operating profit of approximately **HKD 7,442,000** in the prior year, primarily due to reduced sales revenue, partially offset by an increase in gross profit margin from **16.1%** to **18.3%**[12](index=12&type=chunk) - Net loss of approximately **HKD 6,143,000** narrowed from approximately **HKD 18,360,000** in the prior year, mainly due to a significant reduction in expected credit loss provisions following the early repayment of **HKD 27,300,000** in advances from San Tai[12](index=12&type=chunk) [Market Environment and Future Outlook](index=6&type=section&id=Market%20Environment%20and%20Future%20Outlook) The new US government's tariff policies and the trend of manufacturing reshoring severely impact the company's exports to the US, increasing market uncertainty and suppressing consumer confidence, leading to anticipated significant sales decline next year. - The new US government's tariff policies and the trend of manufacturing reshoring severely impact exports to the US, affecting inflation, GDP growth, employment, personal income, and discretionary purchasing preferences[11](index=11&type=chunk) - The company anticipates a **significant decline in sales** next year and will monitor sales recovery after tariff issues are resolved[11](index=11&type=chunk) - Despite current cost-cutting measures, the company will continue to seek other cost reduction opportunities in the coming year[12](index=12&type=chunk) Management Discussion and Analysis [Company Background](index=7&type=section&id=Company%20Background) Sterling Apparel Group Holdings Limited is a Hong Kong-based apparel manufacturer offering one-stop solutions, primarily serving US international brands with production facilities in China and Sri Lanka, and listed on the HKEX since October 2018. - Sterling Apparel Group Holdings Limited is a Hong Kong-based apparel manufacturer providing one-stop apparel manufacturing solutions[14](index=14&type=chunk) - Key clients are US-based international apparel brands, with a long-standing relationship with the largest client since the 1990s[14](index=14&type=chunk) - The company operates three production facilities (one in China, two in Sri Lanka) and outsources some production to the Philippines[14](index=14&type=chunk) - The company's shares have been listed on the Main Board of the Hong Kong Stock Exchange since **October 19, 2018**[14](index=14&type=chunk) [Business Review](index=7&type=section&id=Business%20Review) For the year ended March 31, 2025, group revenue decreased by 16.4% due to lower sales to the largest client and deteriorating credit conditions for new clients; gross margin improved, but gross profit still declined, while selling and distribution expenses decreased, and finance costs significantly increased. - Revenue was approximately **HKD 477,728,000**, a **16.4% decrease** compared to the same period last year[15](index=15&type=chunk) - The decrease in sales revenue was primarily due to a **HKD 26,191,000 (5.9%) reduction** in sales to the largest client and a **HKD 67,471,000 reduction** in sales to new clients, mainly related to deteriorating credit conditions and lost sales[15](index=15&type=chunk) - Gross profit margin improved from **16.1%** to **18.3%**, but gross profit still decreased by approximately **HKD 4,450,000**[15](index=15&type=chunk) - Selling and distribution expenses decreased by **15.0%** to approximately **HKD 20,668,000**, primarily achieved through human resource cost savings[15](index=15&type=chunk)[24](index=24&type=chunk) - Finance costs significantly increased by **31.4%** to approximately **HKD 21,323,000**, mainly due to rising interest rates and guarantee fees for bank borrowing arrangements[16](index=16&type=chunk)[26](index=26&type=chunk) - Expected credit loss provisions decreased to approximately **HKD 4,834,000** (compared to HKD 25,802,000 in the prior year), primarily due to early repayment of approximately **HKD 27,300,000** from San Tai[16](index=16&type=chunk) - A loss of approximately **HKD 6,143,000** was recorded, narrowing from a loss of approximately **HKD 18,360,000** in the prior year[17](index=17&type=chunk) [Revenue Analysis](index=8&type=section&id=Revenue%20Analysis) Group revenue primarily derives from outerwear, bottoms, tops, and other apparel products, with outerwear and bottoms being key contributors; most product categories experienced sales declines due to reduced orders from major US clients, with the US market remaining dominant at 99.6% of total revenue. - Apparel products are categorized into outerwear, bottoms, tops, and others, primarily made from wool, cotton, and polyester[18](index=18&type=chunk) Revenue Contribution by Product Category (HKD '000) | Product Category | 2025 Revenue | 2025 Quantity (Thousand Pieces) | 2025 Unit Price (HKD) | 2024 Revenue | 2024 Quantity (Thousand Pieces) | 2024 Unit Price (HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Outerwear | 219,198 | 616 | 355.8 | 243,226 | 708 | 343.5 | | Bottoms | 208,488 | 1,384 | 150.6 | 208,864 | 1,411 | 148.0 | | Tops | 17,050 | 165 | 103.3 | 29,153 | 193 | 151.1 | | Others | 32,337 | 133 | 243.1 | 89,493 | 474 | 188.8 | | **Total** | **477,073** | **2,298** | | **570,736** | **2,786** | | - Revenue decreased across most product categories, primarily due to reduced sales orders from major US clients[19](index=19&type=chunk) Revenue Contribution by Geography (HKD '000) | Location | 2025 Revenue | 2025 Share | 2024 Revenue | 2024 Share | | :--- | :--- | :--- | :--- | :--- | | United States | 475,971 | 99.6% | 567,791 | 99.4% | | Hong Kong | 302 | 0.1% | 519 | 0.1% | | Others | 1,455 | 0.3% | 3,081 | 0.5% | | **Total** | **477,728** | **100.0%** | **571,391** | **100.0%** | [Gross Profit and Other Income/Expenses](index=9&type=section&id=Gross%20Profit%20and%20Other%20Income%2FExpenses) Gross profit margin improved to 18.3% due to manufacturing efficiency and optimized supplier procurement, while other income decreased due to lower sample and claims revenue, partially offset by new loan interest income, and net other gains and losses significantly declined due to exchange losses. - Gross profit margin was approximately **18.3%** (2024: **16.1%**), an increase primarily due to improved manufacturing efficiency and diversified product sourcing from various suppliers[21](index=21&type=chunk) Other Income (HKD '000) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Sample Income | 2,474 | 4,219 | | Claims Income | 96 | 1,340 | | Interest Income from Loans and Other Receivables | 2,707 | – | | **Total** | **6,479** | **7,757** | - Net other gains were approximately **HKD 50,000** (2024: **HKD 1,608,000**), with the decrease primarily attributable to net exchange losses[23](index=23&type=chunk) [Financial Position and Dividend Policy](index=10&type=section&id=Financial%20Position%20and%20Dividend%20Policy) As of March 31, 2025, the group's cash and bank balances decreased mainly due to bank loan repayments, inventory declined by 27.5%, and no final dividend is recommended; the group faces going concern uncertainty due to current liabilities exceeding current assets and financial covenant breaches, but management is addressing liquidity issues. - Cash and bank balances were approximately **HKD 14,710,000** (2024: **HKD 36,949,000**), a decrease primarily due to bank loan repayments, with bank borrowings reducing from **HKD 188,550,000** to **HKD 105,305,000**[28](index=28&type=chunk) - Inventory decreased by **27.5%** to approximately **HKD 20,502,000**[28](index=28&type=chunk) - No final dividend is recommended for the year ended March 31, 2025[29](index=29&type=chunk) - As of March 31, 2025, the group's current liabilities exceeded current assets by **HKD 112,143,000**, and it breached financial covenants on bank borrowings of **HKD 67,517,000**, indicating significant uncertainty regarding its ability to continue as a going concern[192](index=192&type=chunk)[222](index=222&type=chunk) - The company is negotiating with banks for waivers of financial covenants and believes such waivers are likely to be granted[222](index=222&type=chunk) [Prospects and New Business Development](index=11&type=section&id=Prospects%20and%20New%20Business%20Development) The group maintains a cautious outlook for the coming year due to new US tariff policies and economic uncertainty, expecting reduced client purchasing volumes, and has initiated digital marketing services through its Chinese subsidiary to diversify revenue streams. - The new US government's "reciprocal tariffs" policy and economic uncertainty have suppressed consumer confidence, potentially leading US retailers to reduce inventory purchases[30](index=30&type=chunk) - As of early June 2025, client orders on hand decreased by approximately **30%** compared to last year, reflecting reduced purchasing volumes or delayed client purchases[31](index=31&type=chunk) - The group has commenced digital marketing services through its Chinese subsidiary, including performance advertising, display advertising, and short video exposure services, to diversify revenue streams[31](index=31&type=chunk) - The group will continue to adjust expenses and explore new business opportunities[31](index=31&type=chunk) [Liquidity, Capital Resources, and Capital Structure](index=12&type=section&id=Liquidity%2C%20Capital%20Resources%2C%20and%20Capital%20Structure) As of March 31, 2025, the group had HKD 14,710 thousand in cash and bank balances, HKD 96,198 thousand in current assets, and HKD 208,341 thousand in current liabilities; bank borrowings decreased to HKD 105,305 thousand, and the debt-to-asset ratio significantly improved to 345.2%, with funds raised from new share placements used for general working capital. - Cash and bank balances were approximately **HKD 14,710,000** (2024: **HKD 26,965,000**)[32](index=32&type=chunk) - Current assets were approximately **HKD 96,198,000**, and current liabilities were approximately **HKD 208,341,000**[32](index=32&type=chunk) - Bank borrowings were approximately **HKD 105,305,000** (2024: **HKD 188,550,000**), primarily bearing interest at annual rates ranging from **5.48% to 5.74%**[32](index=32&type=chunk) - The debt-to-asset ratio was approximately **345.2%** (2024: **689.9%**), with the decrease directly resulting from reduced bank borrowings[33](index=33&type=chunk) - Two placements of new shares raised net proceeds of approximately **HKD 5.12 million** and **HKD 3.95 million**, respectively, for general working capital[34](index=34&type=chunk)[36](index=36&type=chunk) [Employees and Remuneration Policy](index=13&type=section&id=Employees%20and%20Remuneration%20Policy) As of March 31, 2025, the group employed 1,281 full-time staff globally, with remuneration based on market conditions, qualifications, experience, position, and seniority, reviewed for performance-based increments, bonuses, and promotions, and no significant labor disputes occurred during the reporting period. - As of March 31, 2025, the group employed approximately **1,281 full-time employees** in Hong Kong, mainland China, and Sri Lanka (2024: **1,290 employees**)[37](index=37&type=chunk) - Remuneration is determined based on market conditions, employee qualifications, experience, position, and seniority, with salary increments, bonuses, and promotions reviewed based on performance[37](index=37&type=chunk) - No serious strikes, significant labor disputes, or difficulties in recruiting skilled employees occurred during the reporting period[37](index=37&type=chunk) [Financial Policies and Foreign Currency Risk](index=13&type=section&id=Financial%20Policies%20and%20Foreign%20Currency%20Risk) The group's operations in Hong Kong, mainland China, the Philippines, and Sri Lanka expose it to foreign currency risks from USD, EUR, RMB, and LKR; currently, there is no foreign currency hedging policy, but a conservative approach is maintained, with continuous monitoring of exchange rate trends for future hedging needs. - The group's business activities and operations are primarily conducted in Hong Kong, mainland China, the Philippines, and Sri Lanka[38](index=38&type=chunk) - The group is exposed to foreign currency risks from **USD, EUR, RMB, and LKR**[38](index=38&type=chunk) - There is currently no foreign currency hedging policy, but a conservative approach is adopted, with exchange rate trends monitored periodically[38](index=38&type=chunk) [Capital Commitments and Contingent Liabilities](index=14&type=section&id=Capital%20Commitments%20and%20Contingent%20Liabilities) As of March 31, 2025, the group had no significant capital commitments and provided corporate guarantees as partial collateral for general banking facilities granted to certain wholly-owned subsidiaries. - As of March 31, 2025, the group had no significant capital commitments[39](index=39&type=chunk) - The group executed corporate guarantees as partial collateral for general banking facilities granted to certain wholly-owned subsidiaries[40](index=40&type=chunk) [Significant Acquisitions and Disposals and Future Plans for Major Investments](index=14&type=section&id=Significant%20Acquisitions%20and%20Disposals%20and%20Future%20Plans%20for%20Major%20Investments) During the reporting period, the group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures, nor did it have any major investment or acquisition plans for capital assets or other businesses as of the reporting date. - No significant acquisitions or disposals of subsidiaries, associates, or joint ventures occurred during the reporting period[41](index=41&type=chunk) - As of the reporting date, there were no specific plans for major investments or acquisitions of capital assets or other businesses[41](index=41&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=14&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) For the year ended March 31, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities. - For the year ended March 31, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities[42](index=42&type=chunk) [Pledge of Assets](index=14&type=section&id=Pledge%20of%20Assets) As of March 31, 2025, the group had no bank deposits pledged for banking facilities, compared to approximately HKD 10.0 million in the prior year. - As of March 31, 2025, the group had no bank deposits pledged for banking facilities (2024: approximately **HKD 10.0 million**)[43](index=43&type=chunk) Directors and Senior Management [Executive Directors](index=15&type=section&id=Executive%20Directors) Executive directors include Ms. Wang Meihui, Chairman and CEO, with over thirty years of apparel industry experience, Mr. Xiao Yiming, responsible for manufacturing facilities and brand development, and Mr. Yang Lun, appointed in May 2025, with extensive sales management experience. - Ms. Wang Meihui (aged **69**) has served as the company's Chairman since **March 23, 2022**, responsible for corporate strategy, business development, product development, key client relationships, and overall corporate performance[44](index=44&type=chunk) - Mr. Xiao Yiming (aged **39**) is responsible for managing manufacturing facilities in Sri Lanka and China, and led the development of the JP by J. Peterman brand in **June 2021**[45](index=45&type=chunk) - Mr. Yang Lun (aged **42**) was appointed as an Executive Director on **May 27, 2025**, bringing extensive experience in sales management[47](index=47&type=chunk) [Independent Non-Executive Directors](index=16&type=section&id=Independent%20Non-Executive%20Directors) Ms. Chen Jie and Ms. Gao Yuanyuan were appointed as independent non-executive directors on May 27, 2025; Ms. Chen is a Fellow of the Association of Chartered Certified Accountants, and Ms. Gao holds a PRC lawyer's certificate with legal experience. - Ms. Chen Jie (aged **40**) was appointed on **May 27, 2025**, is a Fellow of the Association of Chartered Certified Accountants, and has experience in accounting[48](index=48&type=chunk) - Ms. Gao Yuanyuan (aged **34**) was appointed on **May 27, 2025**, holds a People's Republic of China lawyer's certificate, and has experience in legal matters[49](index=49&type=chunk) [Senior Management and Company Secretary](index=16&type=section&id=Senior%20Management%20and%20Company%20Secretary) Mr. Liu Guanghui serves as Senior Purchasing Director with over 27 years of experience, and Mr. Zhou Runzhang is the Company Secretary, possessing over 20 years of experience in accounting, corporate finance, and compliance. - Mr. Liu Guanghui (aged **50**) was promoted to Senior Purchasing Director on **February 1, 2020**, with over **27 years** of experience in purchasing and merchandising[50](index=50&type=chunk) - Mr. Zhou Runzhang is a member of the Hong Kong Institute of Certified Public Accountants, with over **20 years** of experience in accounting, corporate finance, and compliance-related fields[51](index=51&type=chunk) Corporate Governance Report [Corporate Governance Overview](index=17&type=section&id=Corporate%20Governance%20Overview) The Board is committed to developing robust corporate governance and internal control systems to enhance value, accountability, transparency, and shareholder interests, adhering to the HKEX Listing Rules' Corporate Governance Code, except for the combined roles of Chairman and CEO. - The Board is committed to developing and maintaining sound corporate governance and effective internal control systems to enhance corporate value and accountability, formulate business strategies, manage sustainable operations, improve transparency, and protect shareholders' interests[52](index=52&type=chunk) - The company has adopted and complied with all code provisions of the Corporate Governance Code set out in Appendix C1 of the HKEX Listing Rules effective during the period, except for code provision C.2.1 (separation of Chairman and Chief Executive Officer roles), which is deemed reasonable[54](index=54&type=chunk) - The company has adopted the Model Code set out in Appendix C3 of the Listing Rules to regulate directors' dealings in the company's listed securities, and all directors have confirmed compliance[56](index=56&type=chunk) [Board Composition and Operation](index=18&type=section&id=Board%20Composition%20and%20Operation) The Board is responsible for strategy, business development, governance, and risk management, holding at least four regular meetings annually; board composition saw multiple changes, leading to temporary non-compliance with independent non-executive director requirements, which were subsequently rectified, and the combined roles of Chairman and CEO are deemed beneficial for business. - The Board holds at least **four** regular meetings annually, with **nine** Board meetings held during the financial year ended March 31, 2025[58](index=58&type=chunk) - The Board is primarily responsible for strategic direction, business development, corporate governance, risk management, compliance, internal control systems, dividend policy, board diversity policy, shareholder relations, accounting policies, and financial statement matters[61](index=61&type=chunk) - Following Mr. Zeng Haoxian's resignation, the number of independent non-executive directors temporarily fell below the minimum required by Listing Rules 3.10(1) and 3.10A, affecting the composition of the Audit and Remuneration Committees[62](index=62&type=chunk) - After Mr. Zhao Chuan's appointment, the company regained compliance with relevant Listing Rules, but a shortfall in independent non-executive directors reoccurred after Mr. Zhou Runzhang's resignation[63](index=63&type=chunk)[64](index=64&type=chunk) - Ms. Wang Meihui holds both Chairman and Chief Executive Officer roles, which the Board believes benefits the group's business prospects and management[68](index=68&type=chunk) [Board Committees](index=20&type=section&id=Board%20Committees) The Board has established Audit, Remuneration, and Nomination Committees; the Audit Committee oversees financial reporting and risk, the Remuneration Committee sets executive compensation, and the Nomination Committee reviews board structure and identifies candidates, having adopted a diversity policy resulting in 50% gender diversity at both board and employee levels as of March 31, 2025. - The Audit Committee comprises two independent non-executive directors, with Ms. Chen Jie as Chairman, responsible for advising on and overseeing external auditors, financial information, risk management, and internal controls[70](index=70&type=chunk)[71](index=71&type=chunk) - The Remuneration Committee consists of one executive director and two independent non-executive directors, with Ms. Gao Yuanyuan as Chairman, responsible for recommending remuneration policies and structures for directors and senior management, and determining specific remuneration packages[74](index=74&type=chunk)[78](index=78&type=chunk) - The Nomination Committee comprises one executive director and two independent non-executive directors, with Ms. Wang Meihui as Chairman, responsible for reviewing board structure, identifying suitable candidates, assessing independence, and recommending director succession plans[79](index=79&type=chunk)[80](index=80&type=chunk) - The Board has adopted a board diversity policy considering skills, experience, background, gender, age, and other factors; as of March 31,

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Operating Performance Overview](index=1&type=section&id=Operating%20Performance%20Overview) The Group's 2025 operating results show a 16.4% revenue decrease, a shift to operating loss, and a net loss of HK$6,143 thousand, offset by improved gross margin and reduced credit losses | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 477,728 | 571,391 | -16.4% | | Gross Profit | 87,531 | 91,981 | -4.8% | | Gross Profit Margin | 18.3% | 16.1% | +2.2pp | | Operating (Loss)/Profit | (1,309) | 7,442 | N/A (from profit to loss) | | Net Expected Credit Losses on Financial Assets | (4,834) | (25,802) | -81.2% | | Net Loss for the Year | (6,143) | (18,360) | -66.6% | | EBITDA before Expected Credit Losses | 27,164 | 30,836 | -11.9% | | EBITDA after Expected Credit Losses | 22,330 | 5,034 | +343.6% | [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The Group's 2025 revenue decreased, leading to a net loss of HK$6,143 thousand, an improvement from the prior year, driven by narrowed credit losses despite higher finance costs | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 477,728 | 571,391 | | Cost of Sales | (390,197) | (479,410) | | Gross Profit | 87,531 | 91,981 | | Other Income | 6,479 | 7,757 | | Net Other Gains and Losses | 50 | 1,608 | | Selling and Distribution Costs | (20,668) | (24,315) | | General and Administrative Expenses | (53,294) | (52,657) | | Net Expected Credit Losses on Financial Assets | (4,834) | (25,802) | | Finance Costs | (21,323) | (16,226) | | Loss Before Tax | (6,059) | (17,654) | | Income Tax Expense | (84) | (706) | | Loss for the Year | (6,143) | (18,360) | | Loss Per Share (HK cents) | (2.17) | (7.65) | [Consolidated Statement of Financial Position](index=3&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, the Group's total assets and liabilities decreased, with current assets significantly declining, resulting in expanded net current liabilities and a slight increase in net assets | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Total Non-Current Assets | 154,055 | 102,528 | | Total Current Assets | 96,198 | 218,952 | | Total Assets | 250,253 | 321,480 | | Total Current Liabilities | 208,341 | 280,584 | | Net Current Liabilities | (112,143) | (61,632) | | Total Non-Current Liabilities | 11,407 | 13,567 | | Total Liabilities | 219,748 | 294,151 | | Net Assets | 30,505 | 27,329 | | Total Equity | 30,505 | 27,329 | [Notes to the Consolidated Financial Statements](index=5&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [General Information](index=5&type=section&id=General%20Information) Meizhen Group Holdings Limited is incorporated in the Cayman Islands and listed on the Main Board of the Hong Kong Stock Exchange, primarily engaged in manufacturing and trading apparel products and trademark licensing in the US and European markets - The company is an investment holding company, primarily engaged in manufacturing and trading apparel products and trademark licensing in the US and European markets[7](index=7&type=chunk) [Accounting Policies](index=5&type=section&id=Accounting%20Policies) The Group adopted revised HKFRS this year with no significant impact, but new standards like HKFRS 18 are expected to affect future financial statement presentation and disclosures - This year marks the first application of the revised Hong Kong Financial Reporting Standards issued by the HKICPA, with no significant impact on the Group's financial position, performance, and/or disclosures in these consolidated financial statements for the current and prior years[8](index=8&type=chunk) - HKFRS 18 will replace HKAS 1, introducing new requirements for the presentation of specific categories and defined subtotals in the statement of profit or loss, and improving the aggregation and classification of financial statement information, expected to affect the presentation of the statement of profit or loss and future financial statement disclosures, effective for annual periods beginning on or after January 1, 2027[10](index=10&type=chunk) [Basis of Preparation of Financial Statements](index=6&type=section&id=Basis%20of%20Preparation%20of%20Financial%20Statements) Despite a net loss, net current liabilities, and bank covenant breaches as of March 31, 2025, the Group's HKFRS-prepared financial statements reflect management's belief in continued operations via cost control and negotiations - For the year ended March 31, 2025, the Group incurred a net loss of **HK$6,143,000**, with net current liabilities exceeding current assets by **HK$112,143,000**, and a breach of bank loan covenants totaling **HK$67,517,000**, indicating significant uncertainty regarding its ability to continue as a going concern[14](index=14&type=chunk) - To improve liquidity and financial position, the Group has taken measures: * Continue to improve operational efficiency and tighten cost control to enhance profitability and future operating cash flows * Communicate with banks regarding the breach of bank loan covenants and are negotiating waivers; management believes banks may grant approximately **HK$36,033,000** in unutilized bank facilities[15](index=15&type=chunk)[18](index=18&type=chunk) - The consolidated financial statements are presented in Hong Kong Dollars, which is also the functional currency of the Company[17](index=17&type=chunk) [Segment Information](index=8&type=section&id=Segment%20Information) The Group's apparel manufacturing and trademark licensing segments experienced decreased revenue and profit, with the US market as the main, but declining, revenue source, and non-current assets primarily in Sri Lanka, Hong Kong, and China - The Group's operating segments include: * Manufacturing and trading of apparel products * Trademark licensing for royalty income[22](index=22&type=chunk) Segment Revenue and Profit (HK$ thousand) | Segment | 2025 Revenue | 2024 Revenue | 2025 Profit | 2024 Profit | | :--- | :--- | :--- | :--- | :--- | | Manufacturing and Trading of Apparel Products | 477,073 | 570,736 | 23,257 | 28,897 | | Trademark Licensing | 655 | 655 | 552 | 618 | | **Total** | **477,728** | **571,391** | **23,809** | **29,515** | External Customer Revenue by Geographical Location (HK$ thousand) | Region | 2025 Revenue | 2024 Revenue | | :--- | :--- | :--- | | United States | 475,971 | 567,791 | | Hong Kong | 302 | 519 | | Other (mainly Germany and Netherlands) | 1,455 | 3,081 | | **Total** | **477,728** | **571,391** | Non-Current Assets by Geographical Location (HK$ thousand) | Region | 2025 | 2024 | | :--- | :--- | :--- | | Hong Kong | 24,469 | 32,776 | | China | 13,495 | 15,584 | | Sri Lanka | 47,297 | 44,096 | | **Total** | **85,261** | **92,456** | Major Customer Revenue (HK$ thousand) | Customer | 2025 | 2024 | | :--- | :--- | :--- | | Customer A | 419,699 | 445,890 | [Revenue Disaggregation](index=13&type=section&id=Revenue%20Disaggregation) The Group's revenue primarily derives from sales of garments and royalty and related income; outerwear and bottoms are the main contributors to garment sales, though revenue from all major product categories decreased, with revenue recognition predominantly occurring at a point in time Revenue by Major Category (HK$ thousand) | Revenue Category | 2025 | 2024 | | :--- | :--- | :--- | | Sales of Garments | 477,073 | 570,736 | | Royalty and Related Income | 655 | 655 | | **Total** | **477,728** | **571,391** | Revenue by Major Product and Service (HK$ thousand) | Product Category | 2025 | 2024 | | :--- | :--- | :--- | | Outerwear | 219,198 | 243,226 | | Bottoms | 208,488 | 208,864 | | Tops | 17,050 | 29,153 | | Others | 32,992 | 90,148 | | **Total** | **477,728** | **571,391** | - Revenue recognition timing: Revenue recognized at a point in time was **HK$477,073 thousand** (2024: HK$570,736 thousand), and revenue recognized over time was **HK$655 thousand** (2024: HK$655 thousand)[32](index=32&type=chunk) [Other Income](index=13&type=section&id=Other%20Income) For the year ended March 31, 2025, the Group's other income was HK$6,479 thousand, a decrease from HK$7,757 thousand in the prior year, primarily comprising sample sales, bank interest income, and newly added interest income from loans and other receivables | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Bank Interest Income | 648 | 492 | | Sample Sales Income | 2,474 | 4,219 | | Claim Income | 96 | 1,340 | | Government Subsidies | 48 | 66 | | Interest Income from Loans and Other Receivables | 2,707 | – | | Imputed Interest Income from Trade and Other Receivables | – | 829 | | Others | 506 | 811 | | **Total** | **6,479** | **7,757** | [Net Other Gains and Losses](index=14&type=section&id=Net%20Other%20Gains%20and%20Losses) For the year ended March 31, 2025, the Group recorded net other gains of HK$50 thousand, a significant decrease from HK$1,608 thousand in the prior year, mainly due to net exchange losses in the current year | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | (Loss)/Gain on Disposal of Property, Plant and Equipment | (16) | 288 | | Gain on Lease Modification | 87 | – | | Fair Value Change of Prepaid Insurance | 302 | 268 | | Net Exchange (Loss)/Gain | (453) | 1,051 | | Others | 130 | 1 | | **Total** | **50** | **1,608** | [Loss Before Tax](index=14&type=section&id=Loss%20Before%20Tax) Loss before tax reflects deductions for auditor's fees, depreciation, inventory, and staff costs; net expected credit losses increased for trade receivables but reversed for other receivables this year | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Auditor's Remuneration | 1,000 | 980 | | Depreciation (Property, Plant and Equipment) | 5,666 | 4,852 | | Depreciation (Right-of-Use Assets) | 1,400 | 1,610 | | Fair Value Change of Prepaid Insurance | (302) | (268) | | Net Expected Credit Losses on Trade Receivables | 12,172 | 17,856 | | Net Expected Credit Losses on Other Receivables | (7,338) | 7,946 | | Cost of Inventories Recognized as Expense | 341,033 | 405,823 | | Short-Term Lease Expenses | 4,224 | 4,091 | | Staff Costs | 85,148 | 93,638 | - Of the depreciation expense, **HK$3,973 thousand** (2024: HK$1,883 thousand) was included in cost of sales, and **HK$3,093 thousand** (2024: HK$4,579 thousand) in general and administrative expenses[35](index=35&type=chunk) - Of the staff costs, **HK$45,191 thousand** (2024: HK$46,527 thousand) was included in cost of sales; **HK$11,685 thousand** (2024: HK$15,095 thousand) in selling and distribution costs; and **HK$28,272 thousand** (2024: HK$32,016 thousand) in general and administrative expenses[35](index=35&type=chunk) [Income Tax Expense](index=15&type=section&id=Income%20Tax%20Expense) The income tax expense for the current year was HK$84 thousand, primarily due to deferred tax and under-provision for overseas profits tax in prior years; no provision for Hong Kong, China, or Sri Lanka profits tax was made in either year due to carried forward tax losses or no taxable profits | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong Profits Tax - Under-provision in prior years | – | 3 | | Overseas Profits Tax - Under-provision in prior years | 29 | – | | Deferred Tax - Current year | 55 | 703 | | **Income Tax Expense** | **84** | **706** | - No provision for Hong Kong profits tax, China corporate income tax, or Sri Lanka corporate income tax was made in the consolidated financial statements for either year, as the Group's subsidiaries utilized carried forward tax losses or did not generate taxable profits[37](index=37&type=chunk) [Loss Per Share](index=16&type=section&id=Loss%20Per%20Share) For the year ended March 31, 2025, the loss attributable to owners was HK$6,143 thousand, with basic and diluted loss per share of 2.17 HK cents, an improvement from the prior year, as no potential dilutive ordinary shares exist | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Loss for the year attributable to owners of the Company (HK$ thousand) | (6,143) | (18,360) | | Weighted average number of ordinary shares (thousands) | 282,792 | 240,000 | | Basic and Diluted Loss Per Share (HK cents) | (2.17) | (7.65) | - The weighted average number of ordinary shares for calculating basic loss per share for the year ended March 31, 2025, has been adjusted for the share placements on August 16, 2024, and January 8, 2025[40](index=40&type=chunk) [Dividends](index=16&type=section&id=Dividends) The Board does not recommend the payment of a final dividend for the years ended March 31, 2025, and 2024 - The Board does not recommend the payment of a final dividend for the years ended March 31, 2025, and 2024[41](index=41&type=chunk) [Trade and Other Receivables](index=17&type=section&id=Trade%20and%20Other%20Receivables) As of March 31, 2025, total trade and other receivables significantly decreased, with net trade receivables falling to HK$50,321 thousand due to reclassification and credit loss provisions | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade Receivables | 107,061 | 172,953 | | Less: Loss Allowance for Trade Receivables | (56,740) | (49,322) | | **Net Trade Receivables** | **50,321** | **123,631** | | Prepayments | 4,662 | 2,484 | | Other Receivables | 15,217 | 48,962 | | Less: Loss Allowance for Other Receivables | (10,000) | (22,197) | | **Total Trade and Other Receivables** | **60,810** | **153,554** | - Trade receivables aging analysis shows that amounts over **365 days** increased from **HK$71,868 thousand** to **HK$94,466 thousand** * Total trade receivables due from Suntai Global Asset Management Limited ("Suntai") and JP Outfitters Inc. ("JPO") were **HK$93,285 thousand** (2024: HK$106,337 thousand) and **HK$3,348 thousand** (2024: HK$20,830 thousand), respectively * For the year ended March 31, 2025, trade receivables of **HK$33,422 thousand** due from Suntai and JPO were reclassified as loans and other receivables[42](index=42&type=chunk)[43](index=43&type=chunk) - Expected credit loss allowances for trade receivables due from Suntai and JPO were **HK$54,451 thousand** (2024: HK$41,070 thousand) and **HK$1,761 thousand** (2024: HK$6,742 thousand), respectively[44](index=44&type=chunk) [Trade, Bills and Other Payables](index=18&type=section&id=Trade%2C%20Bills%20and%20Other%20Payables) As of March 31, 2025, total trade, bills and other payables amounted to HK$95,539 thousand, an increase from HK$90,978 thousand in the prior year, driven by a significant rise in trade payables and a notable decrease in bills payable | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade Payables | 54,374 | 21,178 | | Bills Payable | 24,784 | 53,561 | | Other Payables and Accruals | 16,381 | 16,239 | | **Total** | **95,539** | **90,978** | - The aging analysis of trade payables shows that amounts due between **91 and 365 days** significantly increased from **HK$251 thousand** to **HK$27,628 thousand**, and amounts due between **31 and 90 days** increased from **HK$2,714 thousand** to **HK$23,399 thousand**[46](index=46&type=chunk) [Leases](index=19&type=section&id=Leases) The Group's leased assets, including land and properties, saw right-of-use assets decrease to HK$23,495 thousand and total lease liabilities fall to HK$3,976 thousand, with stable short-term repayments Carrying Amount of Right-of-Use Assets (HK$ thousand) | Item | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Leasehold Land | 19,941 | 20,511 | | Properties | 3,554 | 5,010 | | **Total** | **23,495** | **25,521** | Lease Liabilities (HK$ thousand) | Item | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Within one year | 1,064 | 1,056 | | More than one year but not more than two years | 422 | 1,221 | | More than two years but not more than five years | 704 | 1,386 | | More than five years | 1,786 | 1,887 | | **Total Lease Liabilities Payable** | **3,976** | **5,550** | | Less: Amounts repayable within 12 months | (1,064) | (1,056) | | **Amounts repayable after 12 months** | **2,912** | **4,494** | - The weighted average incremental borrowing rate applicable to lease liabilities ranged from **3.10% to 8.63%** (2024: 4.08% to 8.49%)[50](index=50&type=chunk) [Loans and Other Receivables](index=20&type=section&id=Loans%20and%20Other%20Receivables) As of March 31, 2025, total loans and other receivables were HK$59,376 thousand, mainly from Suntai Group, with a HK$9,613 thousand loss allowance, reclassified from trade receivables, collateralized by JPO shares, and repayable in 2026 at 7% interest | Item | 2025 (HK$ thousand) | | :--- | :--- | | Loans Receivable | 34,202 | | Other Receivables from Suntai Group | 34,787 | | Less: Loss Allowance | (9,613) | | **Total** | **59,376** | - The Group reclassified trade receivables of **HK$33,422 thousand** and other receivables of **HK$32,860 thousand** related to Suntai Group under financial assistance as loans and other receivables[52](index=52&type=chunk) - Loans receivable advanced to Suntai are denominated in USD, collateralized by JPO shares, bear interest at an effective annual rate of **7%**, and are repayable in 2026; as of March 31, 2025, the contractual maturity date of the loans receivable is more than 12 months from the end of the reporting period, thus classified as non-current[53](index=53&type=chunk) - A loss allowance of **HK$9,613 thousand** (2024: nil) has been recognized for loans and other receivables[55](index=55&type=chunk) [Management Discussion and Analysis](index=22&type=section&id=Management%20Discussion%20and%20Analysis) [Company Background](index=22&type=section&id=Company%20Background) Meizhen Group Holdings Limited is a Hong Kong-based apparel manufacturer providing one-stop solutions to international apparel brands, primarily in the US, with production facilities in China and Sri Lanka, and outsourced production in the Philippines - The Group is a Hong Kong-based apparel manufacturer providing one-stop apparel manufacturing solutions to its customers, primarily international apparel brands headquartered in the US[56](index=56&type=chunk) - As of March 31, 2025, the Group operates three production facilities (one in China, two in Sri Lanka) and outsources production to accredited factories in the Philippines[57](index=57&type=chunk) [Results and Business Review](index=22&type=section&id=Results%20and%20Business%20Review) The Group's revenue decreased by 16.4% to HK$477,728 thousand due to reduced sales and credit issues; gross margin improved to 18.3%, selling costs decreased, but finance costs rose, while credit loss provisions fell, resulting in a narrowed net loss - Revenue for the review year was approximately **HK$477,728 thousand**, a **16.4% decrease** from the prior year, mainly due to a **HK$26,191 thousand (5.9%) reduction** in sales to the largest customer and a **HK$67,471 thousand reduction** due to deteriorating credit conditions of new customers[58](index=58&type=chunk) - Gross profit margin improved from **16.1%** in the prior year to **18.3%**, primarily due to increased efficiency in manufacturing operations and sourcing products from different suppliers[58](index=58&type=chunk)[65](index=65&type=chunk) - Selling and distribution costs decreased by **15.0%** to approximately **HK$20,668 thousand**, mainly due to staff cost savings of approximately **HK$3,647 thousand**[59](index=59&type=chunk)[68](index=68&type=chunk) - Finance costs significantly increased by **31.4%** to approximately **HK$21,323 thousand**, primarily due to rising interest rates throughout the year and guarantee fees of approximately **HK$3,904 thousand** for bank loan arrangements[60](index=60&type=chunk)[70](index=70&type=chunk) - Expected credit losses recorded approximately **HK$4,834 thousand**, a significant decrease from **HK$25,802 thousand** in the prior year, mainly due to Suntai's repayment of approximately **HK$27,300 thousand** in April and May 2025[61](index=61&type=chunk) - The Group recorded a loss of approximately **HK$6,143 thousand** for the review year, compared to a loss of approximately **HK$18,360 thousand** in the prior year, indicating a narrowed loss[61](index=61&type=chunk) [Revenue](index=24&type=section&id=Revenue) The Group's revenue primarily comes from outerwear, bottoms, tops, and other apparel products; due to reduced sales orders from a major US customer, revenue declined across most product categories, with the US market remaining the primary revenue source, accounting for 99.6% of total revenue - Apparel products are categorized into four main types: * Outerwear (jackets, coats, blazers) * Bottoms (trousers, shorts, skirts) * Tops (shirts, blouses, tank tops) * Others (dresses, suits, gowns, scarves, jumpsuits, sleepwear, vests, face masks)[62](index=62&type=chunk) Contribution to Revenue by Product Category (HK$ thousand) | Product Category | 2025 Revenue | 2024 Revenue | 2025 Quantity (thousand pieces) | 2024 Quantity (thousand pieces) | | :--- | :--- | :--- | :--- | :--- | | Outerwear | 219,198 | 243,226 | 616 | 708 | | Bottoms | 208,488 | 208,864 | 1,384 | 1,411 | | Tops | 17,050 | 29,153 | 165 | 193 | | Others | 32,337 | 89,493 | 133 | 474 | | Royalty and Related Income | 655 | 655 | – | – | | **Total** | **477,728** | **571,391** | **2,298** | **2,786** | - The US market contributed **99.6%** of the Group's revenue (2024: 99.4%), with revenue of **HK$475,971 thousand** (2024: HK$567,791 thousand)[64](index=64&type=chunk) [Gross Profit](index=25&type=section&id=Gross%20Profit) The gross profit margin for the review year was approximately 18.3%, an increase from 16.1% in the prior year, primarily attributable to enhanced efficiency in manufacturing operations and diversified product sourcing from various suppliers - The gross profit margin for the review year was approximately **18.3%** (2024: approximately 16.1%); the improvement in gross profit margin was mainly due to increased efficiency in manufacturing operations and sourcing products from different suppliers[65](index=65&type=chunk) [Other Income](index=25&type=section&id=Other%20Income) Other income for the review year was approximately HK$6,479 thousand, a decrease from HK$7,757 thousand in the prior year, primarily comprising sample income, claim income, and newly recognized interest income from loans and other receivables - Other income for the review year was approximately **HK$6,479 thousand** (2024: approximately HK$7,757 thousand); it included sample income of approximately **HK$2,474 thousand** (2024: approximately HK$4,219 thousand), claim income of approximately **HK$96 thousand** (2024: approximately HK$1,340 thousand), and interest income from loans and other receivables of approximately **HK$2,707 thousand** (2024: nil)[66](index=66&type=chunk) [Net Other Gains and Losses](index=25&type=section&id=Net%20Other%20Gains%20and%20Losses) Net other gains amounted to approximately HK$50 thousand, a significant decrease from HK$1,608 thousand in the prior year, primarily due to net exchange losses incurred during the review year - Net other gains amounted to approximately **HK$50 thousand** (2024: approximately HK$1,608 thousand); this decrease was mainly due to net exchange losses during the review year[67](index=67&type=chunk) [Selling and Distribution Costs](index=25&type=section&id=Selling%20and%20Distribution%20Costs) Selling and distribution costs for the review year decreased by approximately 15.0% to about HK$20,668 thousand, mainly attributable to reduced staff costs - Selling and distribution costs for the review year decreased by approximately **15.0%** to approximately **HK$20,668 thousand** (2024: approximately HK$24,315 thousand); the decrease in selling and distribution costs was mainly due to reduced staff costs during the review year[68](index=68&type=chunk) [General and Administrative Expenses](index=25&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses remained stable at approximately HK$53,294 thousand during the review year, largely consistent with the prior year - General and administrative expenses remained stable at approximately **HK$53,294 thousand** (2024: approximately HK$52,657 thousand) during the review year[69](index=69&type=chunk) [Finance Costs](index=26&type=section&id=Finance%20Costs) The Group's finance costs increased by approximately 31.4% to about HK$21,323 thousand in the review year from HK$16,226 thousand in the prior year, primarily due to rising interest rates throughout the year and guarantee fees for bank loan arrangements - The Group's finance costs increased by approximately **31.4%** to approximately **HK$21,323 thousand** in the review year from approximately **HK$16,226 thousand** in the prior year, mainly due to rising interest rates throughout the year and guarantee fees for bank loan arrangements[70](index=70&type=chunk) [Income Tax Expense](index=26&type=section&id=Income%20Tax%20Expense) During the review year, the Group incurred an income tax expense of approximately HK$84 thousand, a significant reduction from HK$706 thousand in the prior year, primarily due to the impact of deferred tax - During the review year, income tax expense was approximately **HK$84 thousand** (2024: income tax expense of approximately HK$706 thousand), mainly due to the Group's deferred tax[71](index=71&type=chunk) [Financial Position](index=26&type=section&id=Financial%20Position) As of March 31, 2025, cash and cash equivalents decreased to HK$14,710 thousand due to loan repayments, inventories fell by 27.5%, and related party payables included rental and guarantee fees to a director's companies - As of March 31, 2025, the Group's cash and cash equivalents were approximately **HK$14,710 thousand** (2024: approximately HK$36,949 thousand), mainly due to bank loan repayments[72](index=72&type=chunk) - Inventories decreased by approximately **HK$7,770 thousand (27.5%)** from approximately **HK$28,272 thousand** as of March 31, 2024, to approximately **HK$20,502 thousand** as of March 31, 2025[72](index=72&type=chunk) - Amounts due to related parties include rental expenses payable to Win 18 Limited and Win 19 Limited (both wholly owned by an executive director of the Company) and guarantee fees payable to the same director[72](index=72&type=chunk) [Dividends](index=26&type=section&id=Dividends) The Company does not recommend the declaration of a final dividend for the year ended March 31, 2025 - The Company does not recommend the declaration of a final dividend for the year ended March 31, 2025 (2024: nil)[73](index=73&type=chunk) [Outlook](index=26&type=section&id=Outlook) US economic policies, including 'reciprocal tariffs,' create market uncertainty and dampen consumer confidence, leading to a 30% drop in the Group's order book and a cautious outlook, prompting exploration of new digital marketing services - The new US administration, starting early April 2025, imposed "reciprocal tariffs" on most countries, with varying rates, and although some high tariff rates have significantly decreased, they remain well above pre-tariff war levels[75](index=75&type=chunk) - Fluctuating tariff policies and their impact on US consumers will undermine confidence and expectations for the economy, thereby affecting their willingness to spend on non-essential consumption like apparel, potentially leading US retailers to reduce inventory purchases[76](index=76&type=chunk) - The Group's order book received from customers by early June 2025 decreased by approximately **30%** compared to the prior year, reflecting reduced or delayed customer purchases, leading to a cautious outlook for the coming year[77](index=77&type=chunk) - The Group has commenced providing digital marketing services through its subsidiary in China as a new business, including performance advertising, display advertising, and short video exposure services, expected to increase revenue streams and enhance existing businesses[77](index=77&type=chunk) [Liquidity, Capital Resources and Capital Structure](index=28&type=section&id=Liquidity%2C%20Capital%20Resources%20and%20Capital%20Structure) As of March 31, 2025, cash and bank balances were HK$14,710 thousand, with net current liabilities of HK$112,143 thousand; bank borrowings decreased, but covenants for HK$67,517 thousand were breached, while the gearing ratio fell to 345.2% due to reduced secured borrowings Liquidity Position (HK$ thousand) | Indicator | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Cash and Bank Balances | 14,710 | 26,965 | | Current Assets | 96,198 | 218,952 | | Current Liabilities | 208,341 | 280,584 | | Bank Borrowings | 105,305 | 188,550 | - As of March 31, 2025, the Group breached covenants for its bank borrowings of **HK$67,517 thousand**[80](index=80&type=chunk) - The gearing ratio (total interest-bearing liabilities divided by total equity) was approximately **345.2%** (March 31, 2024: approximately 689.9%), with the decrease being a direct result of reduced bank borrowings[81](index=81&type=chunk) - The Group's bank borrowings are secured by certain assets of the Group, properties beneficially owned by a director of the Company, and personal guarantees from the same director and a former director of the Company[81](index=81&type=chunk) [Issue of Shares Under General Mandate](index=28&type=section&id=Issue%20of%20Shares%20Under%20General%20Mandate) The Group completed two share placings in 2024, raising net proceeds of HK$5.12 million and HK$3.95 million for working capital; the first placing's proceeds are fully utilized, and the second's remaining funds are expected to be used by July 31, 2025 - July 30, 2024 Placing: * Placing of up to **48,000,000** placing shares at **HK$0.11** per share * Net proceeds of approximately **HK$5.12 million** were fully utilized for general working capital purposes[82](index=82&type=chunk)[83](index=83&type=chunk)[84](index=84&type=chunk) - December 17, 2024 Placing: * Placing of up to **57,600,000** placing shares at **HK$0.070** per share * Net proceeds of approximately **HK$3.95 million**, of which approximately **HK$1 million** has been used for the intended purposes, with the remaining amount expected to be fully utilized by July 31, 2025[84](index=84&type=chunk)[85](index=85&type=chunk) [Employees and Remuneration Policy](index=29&type=section&id=Employees%20and%20Remuneration%20Policy) As of March 31, 2025, the Group employed 1,281 full-time staff across Hong Kong, China, and Sri Lanka; remuneration is performance-based, and no major labor disputes occurred, reflecting a focus on employee relations and talent retention - As of March 31, 2025, the Group employed approximately **1,281** full-time employees in Hong Kong, China, and Sri Lanka (2024: approximately 1,290 full-time employees)[86](index=86&type=chunk) - Remuneration packages are determined based on market conditions and each employee's qualifications, relevant experience, position, and seniority, with salary increments, bonuses, and promotions reviewed based on performance[86](index=86&type=chunk) [Financial Policies and Foreign Currency Risk](index=30&type=section&id=Financial%20Policies%20and%20Foreign%20Currency%20Risk) The Group's operations in Hong Kong, China, Philippines, and Sri Lanka involve foreign currency transactions, exposing it to exchange rate risk; it maintains a conservative, unhedged approach, monitoring trends for future policy considerations - The Group's foreign currency transactions are denominated in USD, EUR, RMB, and LKR, exposing it to foreign currency risk[87](index=87&type=chunk) - The Group currently has no foreign currency hedging policy but adopts a conservative approach to foreign currency management to minimize exposure to exchange rate fluctuations[87](index=87&type=chunk) [Capital Commitments and Contingent Liabilities](index=30&type=section&id=Capital%20Commitments%20and%20Contingent%20Liabilities) As of March 31, 2025, the Group had no significant capital commitments; the Group provides corporate guarantees as part of general banking facilities granted to certain wholly-owned subsidiaries - As of March 31, 2025, the Group had no significant capital commitments[88](index=88&type=chunk) - The Group provides corporate guarantees as part of general banking facilities granted to certain wholly-owned subsidiaries[88](index=88&type=chunk) [Significant Acquisitions and Disposals and Future Plans for Material Investments](index=30&type=section&id=Significant%20Acquisitions%20and%20Disposals%20and%20Future%20Plans%20for%20Material%20Investments) The Group had no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the review year; furthermore, as of the report date, the Group has no specific plans for significant investments or acquisitions of major capital assets or other businesses - The Group had no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the review year[89](index=89&type=chunk) - As of the report date, the Group has no specific plans for significant investments or acquisitions of major capital assets or other businesses[89](index=89&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=30&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) For the year ended March 31, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the year ended March 31, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities (including sales of treasury shares)[90](index=90&type=chunk) [Pledge of Assets](index=30&type=section&id=Pledge%20of%20Assets) As of March 31, 2025, the Group had no bank deposits pledged for its bank facilities, compared to approximately HK$10.0 million in the prior year - As of March 31, 2025, the Group had no bank deposits pledged for its bank facilities (March 31, 2024: approximately **HK$10.0 million**)[91](index=91&type=chunk) [Other Information](index=31&type=section&id=Other%20Information) [Continuing Connected Transactions and Connected Transactions](index=31&type=section&id=Continuing%20Connected%20Transactions%20and%20Connected%20Transactions) The Group entered new lease agreements with related parties and, with independent shareholder approval, signed loan and financial assistance agreements with Suntai Group, and a guarantee fee agreement with directors for bank financing - New Lease Agreements: * SAL (a wholly-owned subsidiary) entered into two new lease agreements with Win 18 and Win 19 (both wholly owned by Ms. Wang Mei Wai, an executive director) * Lease term of one year, commencing February 1, 2025, with monthly rent of **HK$130,000** (HK$1,560,000 annually for each), for office use[92](index=92&type=chunk) - Loan Agreement: * SAL entered into a loan agreement with Suntai to amend the terms of an advance of approximately **HK$32,859,926** to Suntai * Loan term of two years, with an annual interest rate of **7%**, secured by a charge over JPO shares * This transaction constituted a major transaction and was approved by independent shareholders[94](index=94&type=chunk)[97](index=97&type=chunk) - Financial Assistance Agreement: * SAL entered into an agreement with Suntai and JPO to terminate the first letter of support and set out terms for supplying inventories and providing financial assistance * The maximum applicable percentage ratio for the total financial assistance (sum of advances to Suntai and the second financial assistance) exceeded **25%**, constituting a major transaction approved by independent shareholders[98](index=98&type=chunk)[100](index=100&type=chunk) - Guarantee Fee Agreement: * SAL, Mr. Choi, and Ms. Wang (executive directors) entered into a guarantee fee agreement to set out terms for compensating and paying guarantee fees to the guarantors * This agreement is conditional upon the loan agreement and financial assistance agreement and was approved by independent shareholders at an extraordinary general meeting[103](index=103&type=chunk)[104](index=104&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors of Listed Issuers](index=34&type=section&id=Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors%20of%20Listed%20Issuers) The Company adopted the Model Code for Directors' Securities Transactions, with all directors confirming compliance for the year ended March 31, 2025, and no senior management non-compliance noted - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules[105](index=105&type=chunk) - For the year ended March 31, 2025, all directors confirmed compliance with the required standards of the Model Code, and the Company was not aware of any instances of non-compliance by senior management employees[105](index=105&type=chunk) [Code of Conduct and Corporate Governance](index=35&type=section&id=Code%20of%20Conduct%20and%20Corporate%20Governance) The Company complied with the Corporate Governance Code for 2025, except for the combined Chairman/CEO role held by Ms. Wang Mei Wai, which the Board believes benefits the Group's business and management - The Company confirms compliance with the Corporate Governance Code as set out in Appendix C1 of the Listing Rules for the entire year ended March 31, 2025, except for Code Provision C.2.1 (separation of roles of Chairman and Chief Executive)[106](index=106&type=chunk) - Ms. Wang Mei Wai serves as both the Chairman and Chief Executive of the Group, and the Board believes that vesting both roles in the same person is beneficial to the Group's business prospects and management[107](index=107&type=chunk) [Directors' and Chief Executive's Interests](index=35&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests) As of this announcement, no director or chief executive held disclosable interests or short positions in the Company's or associated corporations' shares, underlying shares, or debentures under SFO or Model Code - As of the date of this announcement, no director or chief executive of the Company held any interests or short positions in the shares, underlying shares, or debentures of the Company or any associated corporation that are required to be notified to the Company and the Hong Kong Stock Exchange under the Securities and Futures Ordinance or the Model Code[108](index=108&type=chunk) [Major Shareholders' Interests](index=35&type=section&id=Major%20Shareholders%27%20Interests) As of this announcement, Directors are unaware of any other persons holding disclosable beneficial interests or short positions in shares under SFO Sections 336 or Part XV - As of the date of this announcement, the Directors are not aware of any other persons who have beneficial interests or short positions in the shares that are required to be registered under Section 336 of the Securities and Futures Ordinance, or disclosed under Part XV of the Securities and Futures Ordinance[109](index=109&type=chunk) [Non-Compliance with Listing Rules](index=35&type=section&id=Non-Compliance%20with%20Listing%20Rules) Due to a director's resignation, the Company's independent non-executive directors fell below Listing Rules 3.10(1) and 3.10A minimums, also causing non-compliance with Rule 3.21 for audit committee composition - Due to the resignation of Mr. Chow Yun Cheung, the Company has only two independent non-executive directors, thus falling below the minimum number required by Listing Rules 3.10(1) and 3.10A[110](index=110&type=chunk) - Due to the insufficient number of independent non-executive directors, the Company also failed to comply with Listing Rule 3.21 regarding the minimum number and composition of the audit committee members[111](index=111&type=chunk) [Events After Reporting Period](index=36&type=section&id=Events%20After%20Reporting%20Period) Subsequent to the end of the reporting period, Suntai has early repaid approximately HK$27.3 million of the Group's loans receivable - Subsequent to the end of the reporting period, Suntai has early repaid approximately **HK$27.3 million** of the Group's loans receivable[112](index=112&type=chunk) [Audit Committee Review](index=36&type=section&id=Audit%20Committee%20Review) The Audit Committee reviewed the Group's 2025 audited consolidated financial statements, internal controls, and financial reporting, and currently comprises two independent non-executive directors, Ms. Chan Kit (Chairperson) and Ms. Ko Yuen Yuen - The Audit Committee has reviewed the Group's audited consolidated financial statements for the year ended March 31, 2025 (including the accounting principles and policies adopted by the Group), and discussed internal controls and financial reporting matters[113](index=113&type=chunk) - The Audit Committee currently comprises two independent non-executive directors, Ms. Chan Kit and Ms. Ko Yuen Yuen, with Ms. Chan Kit serving as the Chairperson of the Audit Committee[113](index=113&type=chunk) [Auditor's Scope of Work and Opinion](index=36&type=section&id=Auditor%27s%20Scope%20of%20Work%20and%20Opinion) The auditor confirmed consistency of preliminary results with audited statements, believing the HKFRS-compliant financial statements fairly present the Group's position; however, the report highlights significant going concern uncertainties due to net loss, net current liabilities, and bank covenant breaches - The Group's auditor, BDO Limited, has confirmed that the financial figures for the consolidated statement of financial position, consolidated statement of profit or loss and other comprehensive income, and their related notes for the year ended March 31, 2025, as contained in the preliminary results announcement, are consistent with the amounts in the Group's audited consolidated financial statements for the current year[114](index=114&type=chunk) - The auditor believes that the consolidated financial statements fairly present, in all material respects, the Group's consolidated financial position as of March 31, 2025, and its consolidated financial performance and consolidated cash flows for the year then ended, in accordance with Hong Kong Financial Reporting Standards issued by the HKICPA, and have been properly prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance[115](index=115&type=chunk) - The auditor's report notes that the Group incurred a net loss of **HK$6,143,000** for the year ended March 31, 2025, with net current liabilities exceeding current assets by **HK$112,143,000**, and a breach of bank loan covenants totaling **HK$67,517,000**, indicating significant uncertainties that may cast doubt on the Group's ability to continue as a going concern[116](index=116&type=chunk) [Publication of Annual Results Announcement and Annual Report](index=37&type=section&id=Publication%20of%20Annual%20Results%20Announcement%20and%20Annual%20Report) This announcement has been published on the websites of The Stock Exchange of Hong Kong Limited and the Company; the Company's annual report for the year ended March 31, 2025, will be posted on the aforementioned websites and dispatched to the Company's shareholders in due course - This announcement is published on the website of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company's website (www.sterlingapparel.com.hk)[117](index=117&type=chunk) - The Company's annual report for the year ended March 31, 2025, will be posted on the aforementioned websites and dispatched to the Company's shareholders in due course[117](index=117&type=chunk)