Revenue Performance - Revenue for the first half of the 2022 fiscal year decreased by approximately 20.0% to HKD 770.7 million from HKD 963.4 million in the same period of 2021[11]. - Sales from the Tian Wang watch business accounted for approximately 84.6% of total revenue, decreasing by about 20.5% to HKD 652.1 million[12]. - Revenue from the Balco watch business decreased by approximately 41.5% to HKD 11.5 million, representing about 1.5% of total revenue[13]. - Revenue from other brand sales dropped by approximately 23.5% to HKD 61.5 million, accounting for about 8.0% of total revenue[14]. - The revenue contribution from the Tianwang watch business was approximately 84.6% of the total revenue in the first half of the 2022 fiscal year, down from 85.1% in the same period of the previous year[29]. - The revenue from the Baige watch business decreased by approximately HKD 8.1 million or about 41.5%, from approximately HKD 19.6 million in the first half of the 2021 fiscal year to approximately HKD 11.5 million in the first half of the 2022 fiscal year[33]. - The revenue from other brands (China) decreased by approximately HKD 18.9 million or about 23.5%, from approximately HKD 80.4 million in the first half of the 2021 fiscal year to approximately HKD 61.5 million in the first half of the 2022 fiscal year[34]. - Total revenue for the six months ended December 31, 2021, was HKD 770,678,000, with external sales contributing HKD 770,678,000[90]. Profitability - Gross profit dropped by about 24.5% to HKD 549.4 million, with a gross margin of 71.3%, down from 75.6% in the previous year[20]. - The company's profit attributable to owners decreased from approximately HKD 155.3 million in the first half of the 2021 fiscal year to approximately HKD 40.7 million in the first half of the 2022 fiscal year, a decline of about 73.8%[24]. - The group reported a net profit of HKD 38,580,000 for the period, a decrease from HKD 159,592,000 in the same period of the previous year[67]. - Basic earnings per share for the period was HKD 2.0, down from HKD 7.5 in the previous year, reflecting a decline of 73.3%[68]. - Total comprehensive income attributable to owners was HKD 67,685,000, compared to HKD 289,247,000 in the prior period, representing a decrease of 76.6%[68]. Expenses and Costs - Administrative expenses decreased by approximately 11.7% to HKD 56.7 million due to reduced employee costs[22]. - The employee costs for the first half of the 2022 fiscal year were approximately HKD 210.6 million, compared to HKD 193.0 million in the first half of the 2021 fiscal year[50]. - The total employee costs for the six months ended December 31, 2021, were HKD 210,569, compared to HKD 193,042 in the previous year[102]. Cash Flow and Financial Position - The net cash generated from operating activities for the first half of the 2022 fiscal year was approximately HKD 155.9 million, a decrease of about HKD 148.1 million from HKD 304.1 million in the first half of the 2021 fiscal year[39]. - The net cash generated from investing activities in the first half of the 2022 fiscal year was approximately HKD 521.3 million, primarily from cash inflows of approximately HKD 306.7 million from redeeming financial assets measured at fair value through profit or loss[40]. - The net cash used in financing activities for the first half of the 2022 fiscal year was approximately HKD 42.0 million, mainly due to the repayment of bank loans of approximately HKD 40.0 million[40]. - Cash and cash equivalents at the end of the period stood at HKD 890,290,000, compared to HKD 254,856,000 at the beginning of the period, indicating a significant increase[73]. - The group’s cash and cash equivalents decreased significantly, with term deposits dropping from HKD 658,915,000 as of June 30, 2021, to HKD 462,051,000 as of December 31, 2021, a decline of 29.9%[125]. Assets and Liabilities - Total assets as of December 31, 2021, were HKD 3,069.1 million, while total liabilities were HKD 370.8 million[9]. - The company's inventory balance as of December 31, 2021, was approximately HKD 378.2 million, a slight decrease of about 0.1% compared to HKD 378.7 million as of June 30, 2021[37]. - The company's total assets as of December 31, 2021, were HKD 2,780,351,000, an increase from HKD 2,748,990,000 as of June 30, 2021[70]. - Total liabilities decreased to HKD 82,062,000 from HKD 115,196,000, indicating improved financial stability[70]. - The group’s total liabilities related to lease agreements were approximately HKD 7.3 million, consistent with the right-of-use assets recognized, indicating a balanced approach to lease financing[108]. Business Operations - The number of retail points for Tian Wang watches remained stable at 2,214, with a net decrease of 12 points[12]. - The number of sales points for Tianwang watches decreased by 12 to 2,214 as of December 31, 2021, compared to June 30, 2021[28]. - The company launched no less than 10 new models of Tianwang watches during the first half of the 2022 fiscal year, with prices ranging from approximately RMB 100 to RMB 2,900[29]. - The group plans to optimize its retail network for the Tianwang watch brand by closely monitoring the performance of existing sales points[64]. - The group will continue to enhance its online business capabilities through live streaming and new media channels to attract new customers[65]. Shareholder Information - The company repurchased 2,808,000 shares at an average price of HKD 0.72, totaling HKD 1,980,000, which were cancelled on December 30, 2021[137]. - The board believes that the share repurchase will enhance the company's net asset value per share and earnings per share[161]. - As of December 31, 2021, the chairman and CEO held 1,456,277,000 shares, representing 70.23% of the company[175]. - Red Glory holds a beneficial interest of 1,456,277,000 shares, representing 70.23% of the company's equity[180]. - Ms. Tan holds a beneficial interest of 1,465,369,000 shares, representing 70.67% of the company's equity[180].

Financial Performance - The company reported a profit attributable to owners of HKD 259.1 million for the fiscal year ending June 30, 2021, representing a 183.5% increase from HKD 91.4 million in 2020[11]. - Total equity attributable to owners increased to HKD 2,601.8 million, up 19.9% from HKD 2,169.5 million in 2020[11]. - Basic earnings per share rose to HKD 0.125, a 184.1% increase compared to HKD 0.044 in 2020[11]. - Revenue for the fiscal year was approximately HKD 1,918.0 million, an increase of about 11.1% from HKD 1,726.4 million in 2020[23]. - Gross profit increased by approximately HKD 173.6 million, with a gross margin of 75.4% for 2021, up from 73.7% in 2020[23]. - The group recorded an annual profit of approximately HKD 268.5 million for the fiscal year 2021, an increase of about 352.0% compared to HKD 59.4 million in 2020[24]. - Profit attributable to the company's owners rose from approximately HKD 91.4 million in 2020 to about HKD 259.1 million in 2021, representing an increase of approximately 183.5%[24]. - Earnings per share for the fiscal year 2021 were HKD 0.125, up approximately 184.1% from HKD 0.044 in 2020[24]. - Revenue from continuing operations increased by approximately HKD 191.5 million or about 11.1% to approximately HKD 1,918.0 million in fiscal year 2021[32]. Revenue Breakdown - The Tian Wang watch business contributed approximately 85.7% of total revenue, amounting to about HKD 1,643.2 million, an increase of approximately 13.3% from HKD 1,450.3 million in 2020[33]. - The Baige watch business revenue decreased by approximately 15.5% to about HKD 35.9 million in 2021, down from HKD 42.4 million in 2020[34]. - Other brands (China) revenue increased by approximately 12.0% to about HKD 156.9 million, accounting for approximately 8.2% of total revenue in 2021[35]. Operational Changes - The company discontinued its global distribution of third-party licensed international brands to concentrate on core businesses, including Tian Wang and Balco watches[23]. - The group reduced its retail network from 2,738 sales points in 2020 to 2,549 sales points in 2021, primarily focusing on second, third, and fourth-tier cities[25]. - The number of sales points for Tian Wang watches decreased by 143 to 2,226 as of June 30, 2021, while the sales points for Baige watches decreased by 36 to 271[44]. Cash Flow and Assets - The group maintained cash and bank balances of approximately HKD 254.9 million and fixed deposits of about HKD 1,132.2 million as of June 30, 2021[25]. - The net cash generated from operating activities for the fiscal year 2021 was approximately HKD 426.8 million, an increase of approximately HKD 109.9 million compared to HKD 316.9 million in fiscal year 2020[51]. - The total assets of the company reached HKD 3,077.8 million, a significant increase from HKD 2,496.1 million in 2020[13]. - The total equity of the group as of June 30, 2021, was approximately HKD 2,633.8 million, an increase of approximately HKD 440.6 million from HKD 2,193.2 million as of June 30, 2020[52]. Market Conditions and Strategy - The ongoing COVID-19 pandemic has significantly impacted global economic activities, with the company adapting its strategies in response to local government regulations[78]. - The overall retail operating environment in China is expected to be challenging due to frequent extreme weather events and the ongoing COVID-19 pandemic[79]. - The company plans to carefully evaluate the performance of its retail network and optimize sales points to enhance market coverage and profitability[79]. - E-commerce competition has intensified, leading the company to anticipate a slowdown in growth for this sector[80]. - Management expects the company's performance and financial condition to be inevitably affected in the current and coming years due to the challenging retail environment[80]. Governance and Compliance - The management team emphasized the importance of maintaining high corporate governance standards, adhering to the corporate governance code[108]. - The board of directors includes three independent non-executive directors, ensuring balanced decision-making[109]. - The company has established procedures to handle and disclose inside information accurately and securely[141]. - Independent non-executive directors confirmed their independence according to the listing rules, ensuring compliance with governance standards[118]. - The company has arranged suitable liability insurance for its directors to cover responsibilities arising from corporate activities[113]. Future Outlook and Investments - The company has set a revenue guidance for the next fiscal year, projecting a growth of 10% to 12%[108]. - New product launches are expected to contribute an additional $5 million in revenue, with a focus on smartwatches and accessories[106]. - The company is investing in new technology development, allocating $2 million for R&D in the upcoming year[106]. - Market expansion plans include entering two new international markets, aiming for a 5% market share within the first year[106]. - The company is considering strategic acquisitions to enhance its product portfolio, with a budget of $10 million earmarked for potential deals[106].

Revenue Performance - Revenue for the first half of the 2021 fiscal year decreased by approximately HKD 95.6 million or 9.0% to HKD 963.4 million compared to HKD 1,058.9 million in the first half of the 2020 fiscal year[12]. - The Tian Wang watch business accounted for approximately 85.1% of total revenue in the first half of the 2021 fiscal year, with revenue decreasing by approximately HKD 59.3 million or 6.7% to HKD 820.1 million[13]. - The Baigo watch business revenue decreased by approximately HKD 6.4 million or 24.5% to HKD 19.6 million, representing about 2.0% of total revenue[15]. - Revenue from other brands (China) decreased by approximately HKD 4.9 million or 5.7% to HKD 80.4 million, accounting for about 8.3% of total revenue[16]. - The movement trading business revenue decreased by approximately HKD 24.9 million or 36.5% to HKD 43.4 million, representing about 4.5% of total revenue[17]. - The revenue contribution from the Tian Wang watch business was approximately 85.1% of total revenue in the first half of the 2021 fiscal year, up from 83.0% in the first half of the 2020 fiscal year[29]. - The revenue from the Baige watch business decreased by approximately HKD 6.4 million or about 24.5% from HKD 26.0 million in the first half of the 2020 fiscal year to HKD 19.6 million in the first half of the 2021 fiscal year[30]. - Revenue from other brands (China) decreased by approximately HKD 4.9 million or about 5.7% from HKD 85.3 million in the first half of the 2020 fiscal year to HKD 80.4 million in the first half of the 2021 fiscal year[31]. - The group's revenue from continuing operations for the six months ended December 31, 2020, was HKD 963,391,000, a decrease of 8.99% compared to HKD 1,058,941,000 for the same period in 2019[51]. - The group's total revenue for the six months ended December 31, 2020, was HKD 963,391,000, a decrease from HKD 1,058,941,000 for the same period in 2019, representing a decline of approximately 9%[82]. Profitability - Gross profit for the first half of the 2021 fiscal year decreased by approximately HKD 57.7 million or 7.3% to HKD 728.1 million, with a gross margin increase to 75.6% from 74.2% in the previous year[18]. - Profit attributable to owners increased by approximately HKD 55.6 million or about 55.7% from HKD 99.7 million in the first half of the 2020 fiscal year to HKD 155.3 million in the first half of the 2021 fiscal year[24]. - The group reported a profit before tax of HKD 213,039,000, an increase of 36.2% from HKD 156,456,000 in the previous year[51]. - The net profit attributable to owners of the company from continuing operations was HKD 155,332,000, up from HKD 120,964,000 in the prior year, representing a growth of 28.3%[53]. - The total comprehensive income for the period was HKD 296,782,000, compared to HKD 47,969,000 in the same period last year, indicating significant improvement[55]. - The company reported a net profit of HKD 155,332,000 for the six months ended December 31, 2020[63]. - The company's profit attributable to owners for the six months ended December 31, 2020, was HKD 155,332,000, compared to HKD 99,747,000 for the same period in 2019, representing a year-over-year increase of approximately 55.8%[100]. Expenses and Cost Management - Sales and distribution costs decreased by approximately HKD 76.6 million or about 13.0% from HKD 588.0 million in the first half of the 2020 fiscal year to HKD 511.3 million in the first half of the 2021 fiscal year[20]. - Administrative expenses reduced by approximately HKD 8.8 million or about 12.0% from HKD 73.0 million in the first half of the 2020 fiscal year to HKD 64.2 million in the first half of the 2021 fiscal year[22]. - The employee costs for the first half of the fiscal year 2021 were approximately HKD 193.0 million, down from HKD 223.1 million in the first half of the fiscal year 2020[45]. - The total employee costs for the six months ended December 31, 2020, amounted to 193,042 thousand HKD, down from 223,065 thousand HKD in the previous year, indicating a reduction of about 13.5%[92]. Assets and Liabilities - Total assets increased to HKD 2,870.3 million from HKD 2,496.1 million, while total liabilities rose to HKD 383.2 million from HKD 302.9 million[11]. - The group's total equity as of December 31, 2020, was approximately HKD 2,487.1 million, an increase of about HKD 293.9 million from HKD 2,193.2 million as of June 30, 2020[38]. - The group's operating working capital as of December 31, 2020, was approximately HKD 1,373.8 million, an increase of about HKD 154.9 million from HKD 1,218.9 million as of June 30, 2020[38]. - The group's cash and cash equivalents were approximately HKD 575.4 million as of December 31, 2020, down from approximately HKD 693.6 million as of June 30, 2020[37]. - The total assets less current liabilities amounted to HKD 2,590,858,000, an increase from HKD 2,279,494,000 in the previous period[62]. Inventory and Receivables - The average inventory turnover days increased to 301 days from 289 days, while average trade receivables turnover days improved to 46 days from 63 days[11]. - As of December 31, 2020, the group's inventory balance was approximately HKD 402.0 million, an increase of about HKD 27.7 million or 7.4% compared to HKD 374.3 million as of June 30, 2020[35]. - The aging analysis of trade receivables shows that HKD 192,603,000 (87% of total receivables) were aged 0 to 60 days as of December 31, 2020, compared to HKD 214,092,000 (85%) on June 30, 2020[121]. - Trade receivables from third parties were HKD 261,496,000 as of December 31, 2020, down 8.4% from HKD 285,628,000 on June 30, 2020[118]. - Inventory as of December 31, 2020, was HKD 401,971,000, an increase from HKD 374,315,000 as of June 30, 2020[60]. E-commerce and Market Strategy - The company aims to enhance operational efficiency and expand its sales network, particularly in e-commerce, to strengthen overall competitiveness[3]. - E-commerce continued to be a major driver of revenue, maintaining performance on Alibaba's Tmall platform during the "Double 11" shopping festival compared to the first half of the 2020 fiscal year[34]. - The company plans to focus on expanding its retail network in second, third, and fourth-tier cities to enhance market coverage and profitability[49]. - E-commerce operations are expected to experience moderate growth due to increased competition, but the company will allocate more resources to capture online market share[49]. Tax and Compliance - The effective tax rate increased from approximately 22.4% in the first half of the 2020 fiscal year to 25.1% in the first half of the 2021 fiscal year[23]. - The income tax expense for the six months ended December 31, 2020, was 53,447 thousand HKD, compared to 35,090 thousand HKD in the same period of 2019, reflecting an increase of approximately 52%[88]. - The company maintained compliance with the corporate governance code, with regular reviews planned for the separation of the roles of chairman and CEO[150]. Shareholder Information - The company’s major shareholder, Mr. Dong, holds a controlling interest of 70.02% with 1,456,277,000 shares[156]. - The company has a total of 2,079,946,000 shares issued and fully paid as of December 31, 2020, maintaining the same number since July 1, 2019[126]. - Red Glory Investments Limited holds 1,456,277,000 shares, representing 70.02% of the company's equity[160]. - Ms. Tan holds 1,465,369,000 shares through spousal rights, accounting for 70.45% of the company's equity[160]. - Areo Holdings Limited, along with Ms. Lin and Mr. Li, each holds 180,292,000 shares, representing 8.96% of the company's equity[160]. - Orchid Asia V, L.P. holds 180,946,000 shares, which is 8.70% of the company's equity[163]. - Webb David Michael has a beneficial ownership of 41,217,680 shares, accounting for 1.98% of the company's equity[163]. Financial Reporting and Audit - The company is audited by Deloitte Touche Tohmatsu, a registered public interest entity auditor in Hong Kong[169]. - The group has not adopted any new or revised Hong Kong Financial Reporting Standards that are expected to have a significant impact on the consolidated financial statements in the foreseeable future[76].

Financial Performance - The company's profit attributable to owners was HKD 91.4 million, a decrease of 70.1% from HKD 305.4 million in 2019[5]. - Total revenue for 2020 was HKD 1,726.4 million, down 27.4% from HKD 2,377.9 million in 2019[13]. - Annual profit for the company was approximately HKD 59.4 million, down approximately 79.7% from HKD 293.1 million in the previous fiscal year[28]. - Profit attributable to shareholders decreased from approximately HKD 305.4 million in the previous fiscal year to about HKD 91.4 million, a reduction of approximately 70.1%[28]. - Earnings per share for the fiscal year was HKD 0.044, a decrease of approximately 70.1% from HKD 0.147 in the previous fiscal year[28]. - The group's revenue from continuing operations decreased by approximately HKD 651.5 million or about 27.4% from HKD 2,377.9 million in FY2019 to HKD 1,726.4 million in FY2020, primarily due to the impact of COVID-19 on operations and weakened consumer sentiment[38]. - Gross profit from continuing operations dropped by approximately HKD 481.4 million or about 27.4% from HKD 1,754.6 million in FY2019 to HKD 1,273.2 million in FY2020, aligning with the revenue decline[38]. Assets and Liabilities - The total assets as of June 30, 2020, were HKD 2,496.1 million, a decrease from HKD 2,713.9 million in 2019[14]. - The total liabilities decreased significantly to HKD 302.9 million from HKD 554.8 million in 2019[14]. - The equity attributable to owners was HKD 2,169.5 million, down 2.4% from HKD 2,223.5 million in 2019[5]. - Cash and bank balances increased to approximately HKD 693.6 million, an increase of about HKD 271.9 million or 64.5%[30]. - The total equity as of June 30, 2020, was approximately HKD 2,193.2 million, an increase of about HKD 34.2 million from HKD 2,159.0 million in 2019[58]. - As of June 30, 2020, the company's debt-to-equity ratio decreased to approximately 1.3% from about 9.5% as of June 30, 2019, due to the repayment of all bank borrowings during the fiscal year 2020[59]. Sales and Market Performance - The company's main brand, Tian Wang watches, contributed approximately 84.0% of total revenue, amounting to about HKD 1,450.3 million[29]. - The Tian Wang watch business accounted for approximately 84.0% of total revenue in FY2020, with revenue declining by about HKD 512.8 million or approximately 26.1% to HKD 1,450.3 million[38]. - The Baigao watch business revenue fell by approximately HKD 35.0 million or about 45.2% to HKD 42.4 million in FY2020, mainly due to a decline in sales in the Chinese market[38]. - Other brand watch sales, excluding Tian Wang and Baigao, decreased by approximately HKD 69.2 million or about 33.1% to HKD 140.0 million, representing about 8.1% of total revenue in FY2020[38]. - The number of sales points for Tian Wang watches decreased by 163 to 2,369 as of June 30, 2020, compared to the previous year[48]. - The company has 2,738 sales points in China as of June 30, 2020, down from 2,955 sales points in the previous year[29]. Operational Efficiency - Average inventory turnover days increased to 289 days in 2020 from 247 days in 2019[14]. - Average trade receivables turnover days increased to 63 days in 2020 from 54 days in 2019[14]. - Selling and distribution costs decreased by approximately HKD 285.5 million or about 22.4% to HKD 988.3 million in FY2020, due to reduced franchise fees, rent, and employee costs[41]. - Administrative expenses fell by approximately HKD 21.3 million or about 14.6% to HKD 124.7 million in FY2020, mainly due to strict cost control measures[42]. Future Strategies - The company plans to focus on expanding its core brand Tian Wang and enhancing online sales channels[19]. - The company aims to explore new product development and market expansion strategies in the coming years[19]. - The company plans to continue focusing on e-commerce, having maintained its position as the top seller of watches on Tmall for seven consecutive years[29]. - The company plans to optimize its sales network by closing underperforming sales points and opening new ones in strategic locations[51]. - The company anticipates that the recovery of the economy and consumer sentiment may take longer than expected due to the ongoing impact of COVID-19 in China[45]. - The company plans to allocate more resources to expand its online market share and strengthen online marketing efforts in response to the accelerated shift towards e-commerce[72]. Corporate Governance - The company maintains a high standard of corporate governance, regularly reviewing its practices to ensure compliance with the corporate governance code[106]. - The board consists of seven directors, including four executive directors and three independent non-executive directors[110]. - The company has adopted a code of conduct for directors' securities transactions, ensuring compliance with the standards set forth in the listing rules[108]. - The company has established a written terms of reference for the audit committee, which was revised and adopted by the board effective January 1, 2019[120]. - The company has established service contracts for its executive directors, with initial terms of two years and automatic renewal unless terminated with three months' notice[171]. - The company has received annual independence confirmation from its independent non-executive directors, reinforcing its governance framework[170]. Social Responsibility - The company is committed to sustainable development and has actively participated in various charitable activities, focusing on education projects to help underprivileged youth[89]. - The company has made donations to environmental initiatives, contributing to social sustainability efforts over the years[89]. - The company aims to provide opportunities for youth to access higher education through its charitable contributions[89]. - The company has a commitment to social responsibility, engaging in various initiatives to support youth in crisis[89]. Shareholder Information - The company reported a total reserve available for distribution to shareholders of approximately HKD 1,315.6 million for the fiscal year 2020, compared to HKD 1,318.4 million for the fiscal year 2019[165]. - The company did not recommend the payment of a final dividend for the fiscal year 2020, while a final dividend of HKD 0.043 per share was paid for the fiscal year 2019[163]. - The company has a sustainable and stable dividend policy aimed at balancing shareholder expectations and prudent capital management[152]. - The company has a dedicated contact for shareholder inquiries regarding share ownership and dividend payments[145].

Revenue and Profitability - Revenue for the first half of the 2020 fiscal year decreased by approximately HKD 133.3 million or 11.2% to HKD 1,058.9 million compared to the same period in 2019[9] - Gross profit for the first half of 2020 was HKD 785.8 million, down approximately HKD 88.7 million or 10.1% from HKD 874.6 million in the first half of 2019, with a gross margin increase to 74.2%[14] - Profit attributable to owners decreased by approximately HKD 20.7 million or 17.2% to HKD 99.7 million in the first half of the 2020 fiscal year[19] - The pre-tax profit for the period was HKD 156.5 million, down from HKD 164.8 million in the previous year, with a net profit from continuing operations of HKD 121.4 million compared to HKD 116.5 million[45] - The group reported a revenue of HKD 1,058.9 million for the six months ended December 31, 2019, with a gross profit of HKD 785.8 million, compared to HKD 1,192.2 million and HKD 874.6 million respectively for the same period in 2018[45] Business Segments - The Tian Wang watch business accounted for approximately 83.0% of total revenue in the first half of 2020, with sales decreasing by about HKD 90.9 million or 9.4% to HKD 879.4 million[10] - The Baigo watch business revenue decreased by approximately HKD 15.3 million or 37.0% to HKD 26.0 million, accounting for about 2.5% of total revenue in the first half of 2020[11] - Other brand sales, excluding Tian Wang and Baigo, fell by approximately HKD 22.4 million or 20.8% to HKD 85.3 million, representing about 8.1% of total revenue[12] - Retail sales of Tian Wang watches decreased by approximately 9.4% in the first half of the 2020 fiscal year, primarily due to the contraction of the traditional watch retail market[24] - The revenue from Baige watches decreased by approximately HKD 15.3 million or 37.0% to HKD 26.0 million in the first half of the 2020 fiscal year, mainly due to a decline in the retail market in Hong Kong, Macau, and Taiwan[25] Financial Position - Total assets as of December 31, 2019, were HKD 2,614.7 million, while total liabilities were HKD 373.1 million[8] - The equity attributable to the owners of the company was HKD 2,203.6 million as of December 31, 2019[8] - The total equity of the company as of December 31, 2019, was approximately HKD 2,241.6 million, an increase of about HKD 82.6 million from HKD 2,159.0 million on June 30, 2019[35] - The company had cash and cash equivalents (excluding bank overdrafts) of approximately HKD 568.0 million and HKD 397.9 million as of December 31, 2019, and June 30, 2019, respectively[34] - The company's net cash from operating activities for the first half of the 2020 fiscal year was approximately HKD 200.1 million, a decrease of about HKD 36.4 million from HKD 236.5 million in the same period of the previous year[34] Expenses and Costs - Sales and distribution costs decreased by approximately HKD 56.0 million or 8.7% to HKD 588.0 million in the first half of the 2020 fiscal year, mainly due to reduced franchise fees and advertising expenses[16] - Administrative expenses decreased by approximately HKD 9.1 million or 11.1% to HKD 73.0 million in the first half of the 2020 fiscal year, attributed to one-time expenses from the 30th anniversary celebration of the Tian Wang brand[17] - Financing costs increased by approximately HKD 0.3 million or 136.2% to HKD 0.6 million in the first half of the 2020 fiscal year, while income tax expenses decreased by approximately HKD 13.2 million or 27.4% to HKD 35.1 million[18] Inventory and Turnover - Average inventory turnover days improved slightly from 247 days to 243 days[8] - As of December 31, 2019, the company's inventory balance was approximately HKD 447.1 million, a decrease of about HKD 33.6 million or 7.0% compared to HKD 480.7 million on June 30, 2019[32] - The company's inventory turnover days improved from approximately 247 days as of June 30, 2019, to about 243 days in the first half of the 2020 fiscal year[32] E-commerce and Market Trends - The e-commerce business has been a major revenue growth driver for the company, with stable sales during the "Double 11" shopping festival on Alibaba's Tmall platform, maintaining the top position in domestic watch sales for seven consecutive years[28] - The group expects its e-commerce business to face intense competition, with anticipated moderate growth or even a slowdown, but will continue to allocate additional resources to develop e-commerce[43] Corporate Governance and Shareholding - The company has adopted corporate governance practices in line with the listing rules, ensuring compliance throughout the first half of the 2020 financial year[164] - As of December 31, 2019, the company’s major shareholder, Mr. Dong Guanming, held 70.02% of the shares, amounting to 1,456,277,000 shares[169] - Red Glory holds a beneficial ownership of 1,456,277,000 shares, representing 70.02% of the equity[173] - Ms. Tan holds a beneficial ownership of 1,465,369,000 shares, representing 70.45% of the equity[176] Impact of COVID-19 - The company reported that the COVID-19 pandemic has impacted operations at sales points in China, with ongoing monitoring of its financial effects[161] - The group anticipates that most retail stores in China, except those in Hubei province, will gradually resume normal operations by the end of February 2020[43] Accounting Standards and Financial Reporting - The company applied new accounting standards, including HKFRS 16 on leases, which may impact future financial reporting[69] - The cumulative effect of adopting HKFRS 16 was recognized on the initial application date of July 1, 2019, without restating comparative information[83] - The company has not early adopted any new or revised HKFRS that have been issued but are not yet effective, including HKFRS 17 on insurance contracts[95]

Financial Performance - The company recorded revenue of approximately HKD 2,670.2 million for the fiscal year 2019, a decrease of about 9.9% compared to the previous year[23]. - The net profit attributable to the company's owners increased to approximately HKD 305.4 million, representing a growth of about 4.8%[23]. - Earnings per share for the fiscal year 2019 were HKD 0.147, an increase of approximately 5.0% from HKD 0.140 in the previous year[23]. - The gross profit margin for the fiscal year 2019 was 70.6%, slightly up from 70.2% in the previous year[12]. - The gross profit for the group fell from approximately HKD 2,079.2 million in fiscal year 2018 to about HKD 1,885.3 million in fiscal year 2019, a decline of approximately HKD 194.0 million or about 9.3%[39]. - Other income, gains, and losses increased by approximately HKD 29.3 million or about 67.8% to HKD 72.6 million in fiscal year 2019[40]. - The group's financing costs decreased by approximately HKD 0.7 million or about 7.4% to HKD 8.3 million due to reduced borrowings in the watch movement trading business[43]. - The company's distributable reserves for the fiscal year 2019 amount to approximately HKD 1,318.4 million, an increase from HKD 895.1 million in the fiscal year 2018[154]. Revenue Breakdown - The Tian Wang watch business contributed approximately 73.5% of total revenue, amounting to about HKD 1,963.1 million[25]. - The Baige watch brand contributed approximately HKD 77.4 million, accounting for 2.9% of total revenue[25]. - The Tian Wang watch business accounted for approximately 73.5% of total revenue in fiscal year 2019, with revenue decreasing by about HKD 209.8 million or approximately 9.7% to HKD 1,963.1 million[34]. - The Baigao watch business saw a revenue decline of approximately HKD 38.7 million or about 33.4%, down to HKD 77.4 million in fiscal year 2019[35]. - Revenue from other brands (China) decreased by approximately HKD 20.2 million or about 8.8% to HKD 209.2 million, accounting for approximately 7.8% of total revenue[36]. - E-commerce sales for the group slightly declined by 1.5% to approximately HKD 566.4 million in fiscal year 2019, despite remaining a key revenue driver[52]. Dividend Policy - The company plans to maintain a balanced and stable dividend policy, proposing a final dividend of HKD 0.043 per share, up from HKD 0.0375 in the previous year[24]. - The proposed final dividend for the fiscal year 2019 is HKD 0.043 per share, totaling approximately HKD 89.4 million, subject to shareholder approval[152]. - The company has maintained a sustainable and stable dividend policy, balancing shareholder expectations and prudent capital management[141]. Sales and Distribution - As of June 30, 2019, the group had a total of 2,955 sales points in China, with a plan to replace underperforming department store locations with more stylish points in shopping centers[26]. - The sales points for Tianwang watches decreased by 53 to 2,532 as of June 30, 2019, while Baige watches saw a reduction of 40 sales points to 353[46]. - The group continues to optimize its sales network by closing underperforming sales points and opening new ones in strategic locations[49]. - The company aims to expand its retail presence by opening more sales points in shopping centers, replacing underperforming department store locations[73]. Corporate Governance - The company has a strong focus on corporate governance, adhering to the corporate governance code as per the listing rules, and has established a corporate governance committee[93]. - The board consists of seven directors, including four executive directors and three independent non-executive directors as of June 30, 2019[96]. - The company has adopted a code of conduct for directors' securities trading, confirming full compliance with the standards set forth in the listing rules for the fiscal year 2019[95]. - The board has delegated daily responsibilities to executive directors and senior management under strict supervision to ensure compliance with company policies and strategies[97]. - Independent non-executive directors have confirmed their independence according to the listing rules, with an initial term of two years followed by automatic renewal[105]. - The company ensures that all directors participate in ongoing professional development to enhance their knowledge and skills relevant to their roles[105]. Market Strategy - The company aims to continue focusing on existing business development while leveraging its established market reputation in the Chinese watch market[25]. - The company is implementing strategies to improve Baige watch performance, including optimizing sales and distribution channels[48]. - The company anticipates challenges in the watch market over the next few years but is prepared to seize opportunities in the "New Retail" era in China[74]. - The company is focusing on diversifying its product lines, particularly targeting younger customers[73]. Social Responsibility - The company is committed to social responsibility, participating in charitable activities and focusing on education initiatives[79]. - Charitable donations for the fiscal year 2019 were approximately HKD 3.7 million, an increase from HKD 2.7 million in the fiscal year 2018[199]. Shareholder Engagement - The company has established procedures for shareholders to convene special meetings and submit proposals[131]. - Shareholders must provide detailed contact information when submitting inquiries to ensure timely responses[134]. - The company has a dedicated contact for shareholder inquiries regarding share ownership and dividend payments[133]. Management and Staffing - Employee costs for the fiscal year 2019 were approximately HKD 485.5 million, a decrease from HKD 532.3 million in the previous fiscal year[64]. - The company is committed to employee development through training and career advancement opportunities[149]. Financial Position - As of June 30, 2019, the total assets of the company amounted to approximately HKD 2,159.0 million, an increase of about HKD 105.9 million from HKD 2,053.1 million on June 30, 2018[59]. - The company’s cash and cash equivalents, net of bank overdrafts, were approximately HKD 397.9 million as of June 30, 2019, down from HKD 754.1 million a year earlier[57]. - The company’s total equity increased to approximately HKD 2,159.0 million as of June 30, 2019, compared to HKD 2,053.1 million on June 30, 2018[59].

Financial Performance - The revenue for the first half of the fiscal year 2019 was approximately HKD 1,368.4 million, a decrease of about HKD 121.1 million or 8.1% compared to HKD 1,489.5 million in the first half of fiscal year 2018[18]. - Gross profit for the first half of fiscal year 2019 was HKD 963.1 million, with a gross margin of 70.4%, compared to HKD 1,028.2 million and a gross margin of 69.0% in the same period of the previous year[7]. - The profit attributable to the company's owners decreased from approximately HKD 146.2 million in the first half of FY2018 to approximately HKD 120.4 million in the first half of FY2019, a decrease of about 17.6%[29]. - The net profit for the period was HKD 125,244, a decrease of 10.9% from HKD 140,829 in the previous year[54]. - The company reported a total comprehensive income of HKD 46,087, significantly lower than HKD 169,434 in the prior year[54]. - The company's profit for the six months ended December 31, 2018, was HKD 120,427,000, a decrease from HKD 146,169,000 for the same period in 2017[109]. Revenue Breakdown - The Tian Wang watch business accounted for approximately 70.9% of total revenue in the first half of fiscal year 2019, generating HKD 970.3 million, down 8.9% from HKD 1,065.3 million in the first half of fiscal year 2018[19]. - Retail sales from the Tian Wang watch business decreased by approximately 10.5% in the first half of fiscal year 2019 compared to the same period in fiscal year 2018[19]. - The Balco watch business contributed approximately 3.0% to total revenue in the first half of fiscal year 2019, with sales dropping 35.1% to HKD 41.3 million from HKD 63.5 million in the same period of the previous year[20]. - Other brand sales in China decreased by approximately HKD 2.8 million or 2.5% to HKD 107.7 million, accounting for 7.9% of total revenue in the first half of fiscal year 2019[21]. - Revenue from global distribution of various international brand watches increased from approximately HKD 172.8 million in the first half of FY2018 to approximately HKD 176.2 million in the first half of FY2019, representing a growth of about 2.0%[22]. Market Conditions - The overall retail market in China has shown a decline, particularly affecting mid-to-high-end imported watches and intensifying competition from similar-priced imported watches[21]. - Retail sales of Tian Wang watches decreased by approximately 10.5% in the first half of FY2019 compared to the same period in FY2018, primarily due to the negative impact of the US-China trade war[33]. Cost and Expenses - The group's gross profit decreased from approximately HKD 1,028.2 million in the first half of FY2018 to approximately HKD 963.1 million in the first half of FY2019, a decline of about 6.3%[24]. - The group's gross profit margin increased from approximately 69.0% in the first half of FY2018 to approximately 70.4% in the first half of FY2019, an increase of about 1.4 percentage points[24]. - Total employee costs for the period amounted to HKD 252,939,000, slightly down from HKD 255,826,000 in the previous year[107]. - The financing costs for the six months ended December 31, 2018, totaled HKD 3,812, slightly down from HKD 3,908 in the same period of 2017, a decrease of about 2.5%[103]. Cash Flow and Investments - The net cash generated from operating activities for the first half of the 2019 fiscal year was approximately HKD 236.5 million, a decrease of about HKD 4.6 million compared to HKD 241.1 million in the same period of 2018[40]. - The net cash used in investing activities for the first half of the 2019 fiscal year was approximately HKD 599.1 million, primarily from the purchase of property, plant, and equipment amounting to about HKD 62.0 million[41]. - The net cash generated from financing activities for the first half of the 2019 fiscal year was approximately HKD 177.8 million, mainly due to a net increase in bank borrowings of about HKD 258.8 million[42]. Inventory and Receivables - The group’s inventory balance as of December 31, 2018, was approximately HKD 558.9 million, a decrease of about HKD 24.8 million or 4.2% from HKD 583.7 million as of June 30, 2018[39]. - Trade receivables from third parties amounted to HKD 330,567,000 as of December 31, 2018, down 20.4% from HKD 415,692,000 on June 30, 2018[118]. - The aging analysis of trade receivables shows that amounts overdue by 0 to 60 days decreased by 21.4% from HKD 337,548,000 to HKD 265,154,000[119]. Corporate Governance and Compliance - The company has complied with the corporate governance code during the first half of the 2019 fiscal year, with regular reviews planned for the roles of chairman and CEO[150]. - The audit committee has reviewed the unaudited condensed consolidated financial statements for the first half of the 2019 fiscal year[152]. - The company has confirmed that all directors have complied with the standards of the securities trading code during the first half of the 2019 fiscal year[151]. Accounting Standards and Financial Reporting - The company has adopted new accounting standards, including HKFRS 9 and HKFRS 15, which may impact financial reporting and asset classification[65]. - The company applies the expected credit loss model under HKFRS 9, updating the expected credit loss amount to reflect changes in credit risk since initial recognition[71]. - The expected credit loss for trade receivables is assessed individually for significant balances or collectively using an appropriate provision matrix[74]. - The company recognizes any fair value gains or losses of financial assets measured at fair value through profit or loss in the income statement[70]. Shareholder Information - As of December 31, 2018, the major shareholder Red Glory holds 1,456,277,000 shares, representing 70.02% of the total shares[159]. - Orchid Asia V, L.P. holds 188,298,000 shares, while Orchid Asia V Co-Investment, Limited holds 5,632,000 shares[163].