Financial Performance - For the year ended December 31, 2018, the company reported revenue of approximately HKD 1,277,164,000, a decrease of 62.19% compared to HKD 3,378,077,000 in 2017[11] - The net loss for 2018 was approximately HKD 410,662,000, which represents an 84.92% reduction from the net loss of HKD 2,723,076,000 in 2017[11] - The gross margin for 2018 was -5.63%, an improvement of 3.80% from -9.43% in 2017[11] - Total revenue for the year was HKD 1,277.16 million, a decrease of 62.19% compared to HKD 3,378.08 million in the previous year[22] - Sales of mobile phones and related accessories amounted to HKD 1,261.39 million, down 61.35% from HKD 3,263.89 million in the prior year[23] - The company reported a gross loss of HKD 71.93 million, a reduction of 77.41% from HKD 318.40 million in the previous year[23] - Other income and gains for 2018 were approximately HKD 213.37 million, a decrease of 41.93% from HKD 367.44 million in 2017, primarily due to reduced government grants and interest income[27] - Selling and distribution expenses decreased to HKD 158.01 million in 2018 from HKD 667.86 million in 2017, representing a reduction of 76.34%[31] - Administrative expenses decreased by 54.45% to HKD 323.08 million in 2018 from HKD 709.26 million in 2017, with the percentage of administrative expenses to revenue increasing to 25.30%[32] - The company's cash and cash equivalents as of December 31, 2018, were HKD 168.55 million, down from HKD 451.13 million in 2017[37] - The debt-to-asset ratio increased to 85% in 2018 from 80% in 2017, indicating a higher level of financial leverage[37] Market Expansion and Product Development - The company continued to strengthen partnerships with local operators and launched low-end smartphones to align with their diverse contract layouts[12] - Sales in the U.S. market continued to grow, contributing significantly to total sales, with the U.S. becoming a major business region for the company[12] - The company expanded its product line in the U.S. market to include smart accessories such as data cables, chargers, batteries, and headphones[12] - The company established a dedicated U.S. R&D team to conduct product demand and preference surveys in the U.S. market[12] - The company aims to strengthen its retail network in the U.S. and is prioritizing brand promotion through numerous local events[18] - The company recognizes opportunities in Southeast Asia, South Asia, and Africa, planning to sell profitable products in these regions[18] - The product portfolio will expand into IoT and mobile broadband areas, including grids, speakers, and smart cameras, supported by advancements in AI, IoT, and 5G technologies[53] Research and Development - The company has submitted over 100 Small Cell patent applications as part of its commitment to developing next-generation 5G technology[19] - The company plans to focus on artificial intelligence technologies, including facial recognition and scene classification, to enhance product offerings[17] - The company will continue to invest in R&D for 5G technology and conduct testing to meet commercial standards[19] - The company plans to invest more resources in R&D to enhance user experience and has a dedicated team for optimizing Android features[47] Legal and Compliance Issues - The company has initiated legal action against Xiaomi for patent infringement, with favorable evidence from the patent review committee[14] - The company is currently involved in civil claims from suppliers for overdue payables totaling approximately HKD 147 million[39] - The company faced ongoing litigation with customers regarding overdue trade receivables amounting to approximately HKD 195.82 million[38] Corporate Governance - The company held three meetings of the Audit Committee in 2018, with all members attending each meeting[73] - The Compensation Committee reviewed the compensation packages for 12 senior management members, with 10 earning between HKD 1,000,000 and HKD 1,000,000, and 1 earning between HKD 4,000,001 and HKD 5,000,000[70] - The Nomination Committee held one meeting in 2018, focusing on the review and recommendation of board members for reappointment at the annual general meeting[75] - The company emphasizes continuous professional development for all directors, providing training and updates on relevant regulations and business operations[82] - The company has established three committees: the Nomination Committee, the Compensation Committee, and the Audit Committee, each with specific responsibilities[68] - The company ensures compliance with legal and regulatory policies through regular reviews and monitoring by the board and committees[68] - The board of directors includes independent non-executive members who participate in governance and oversight functions[72] Environmental Sustainability - The total greenhouse gas emissions for the year were approximately 6,000 tons, with over 95% coming from electricity consumption[120] - The company is committed to sustainable development strategies, including environmental sustainability and stakeholder communication[104] - The company focuses on integrating environmental protection and social responsibility into daily operations to reduce carbon emissions[119] - The company has implemented energy-saving measures, including encouraging employees to turn off idle equipment and use natural lighting[132] - The company has established waste management policies to reduce various types of waste and promote recycling[128] Employee and Training Development - The average monthly employee turnover rate was maintained at approximately 8% due to competitive employee benefits[141] - As of December 31, 2018, the employee gender ratio was approximately 2:1, with 416 males and 221 females, totaling 637 employees[143] - A total of 189 employees received 1,160 hours of training during the reporting year, with 30% of employees participating in training[151] - The company emphasizes the importance of employee training and development to enhance performance and professional skills[150] Supplier and Quality Management - The company has established long-term relationships with 375 suppliers, with 329 located in China, 45 in Hong Kong, and 1 in Singapore[154] - The company has implemented a comprehensive quality control system that meets various management system certifications, including ISO9001 and ISO14001[157] - The company has a robust supply chain management system to ensure timely delivery of high-quality products to customers[155]