Core Points - The company announced a significant drop in its stock price on April 16, 2025, accompanied by an increase in trading volume [1] - Tycoon Empire Investment Limited, controlled by the company's executive director and chairman, sold 129 million shares due to a forced sale triggered by the sharp decline in stock price [1] - Following the forced sale, the chairman and Tycoon Empire hold a total of 302 million shares, representing 37.75% of the company's issued share capital [2] - Other major shareholders, including China Resources Pharmaceutical Group and Jacobson Group Treasury Limited, have not sold any shares recently [2] - The board confirmed that they are unaware of any reasons for the unusual price and volume changes, nor do they possess any insider information that needs to be disclosed [2] - The company has applied to the stock exchange to resume trading of its shares starting from 9:00 AM on April 17, 2025 [3]

Financial Performance - Total revenue for the fiscal year 2024 was HKD 876.0 million, a decrease of 26.9% compared to HKD 1,198.6 million in 2023[5] - The company's net profit attributable to equity holders dropped by 98.9% to HKD 3.2 million, with a profit margin of 0.4% compared to 24.8% in the previous year[5] - EBITDA for the fiscal year 2024 was HKD 41.9 million, down 88.4% from HKD 360.8 million in 2023, resulting in an EBITDA margin of 4.8%[5] - Adjusted net profit for the fiscal year was HKD 46.4 million, a decrease of 59.5% from HKD 114.8 million in 2023[5] - The group's gross profit decreased by 27.5% to HKD 232.7 million for the fiscal year, with a gross margin decline of 0.2 percentage points to 26.6% due to rising commodity costs[31] - Other income and net other gains for the fiscal year were HKD 4.8 million, a significant drop from HKD 209.0 million in the previous fiscal year, primarily due to the one-time gain from the sale of 51% equity in CWA[32] - Profit attributable to equity holders of the company was HKD 6.0 million, down from HKD 297.3 million in the previous fiscal year, mainly due to the absence of one-time gains from the sale of CWA and increased share-based payment expenses[33] Revenue Breakdown - Retail revenue increased by 63.4% year-on-year to HKD 176.4 million, while distribution sales in Hong Kong grew by 3.3% to HKD 533.0 million[7] - Southeast Asia distribution sales reached HKD 77.3 million, a significant increase of 63.5% year-on-year, with Singapore contributing HKD 65.6 million, up 56.9%[8] - Revenue from Hong Kong increased by 13.7% to HKD 709.4 million in fiscal year 2024, compared to HKD 623.7 million in fiscal year 2023, despite a slight growth in distribution business[30] - Revenue from Singapore, Malaysia, and other regions surged by 59.8% to HKD 77.3 million in fiscal year 2024, up from HKD 48.3 million in fiscal year 2023[30] - Macau's revenue decreased by 20.7% to HKD 89.3 million in fiscal year 2024, down from HKD 112.7 million in fiscal year 2023, attributed to changes in consumer spending patterns[30] Strategic Initiatives - The company plans to maintain market share in Hong Kong and Macau while controlling costs and enhancing profit margins through strategic partnerships and product diversification[9] - The company aims to develop proprietary and collaborative brands to enhance profitability and meet market trends[9] - The company anticipates significant growth in distribution sales in Thailand, with revenue expected to multiply by the end of the fiscal year 2025[10] - The company plans to leverage the updated free trade agreement with ASEAN, which expanded covered product categories from over 200 to nearly 600, to enhance competitiveness in Southeast Asia[14] - The company aims to continue expanding its market share and product offerings in the Asia-Pacific region, focusing on health and wellness products[10] Dividend Policy - The board decided not to declare a final dividend for the fiscal year due to the uncertain operating environment[7] - The board has decided not to declare any final dividend for the 2024 financial year, compared to a dividend of HKD 0.035 per share for the 2023 financial year[65] - The board will continue to review the dividend policy, which has been in effect since April 15, 2020, allowing for the declaration of interim or special dividends[91] - The company has adopted a dividend policy that requires consideration of various factors, including financial performance and cash flow[95] Corporate Governance - The board consists of eight members, including one executive director, four non-executive directors, and three independent non-executive directors[193] - The board held five meetings during the fiscal year to review financial and operational performance and discuss future strategies[196] - The company has adhered to all corporate governance code provisions during the fiscal year, except for deviation from provision C.2.1[191] - The company emphasizes high ethical standards and believes that acting with integrity and transparency will maximize long-term shareholder returns[188] - The company has established a corporate governance committee responsible for formulating and reviewing governance policies and practices[190] Shareholder Information - The company has a significant shareholder, Tycoon Empire, holding 432,616,326 shares, representing 54.08% of the total shares[133] - Major shareholder Wei Siqi also holds 432,616,326 shares, equivalent to 54.08%[137] - China Resources Pharmaceutical Retail holds 151,895,000 shares, accounting for 18.99% of the total shares[137] - Jacobson Group Treasury Limited owns 56,590,000 shares, which is 7.07% of the total shares[137] - The company has not entered into any significant contracts with its controlling shareholders during the fiscal year[132] Employee Information - The number of employees increased to 260 as of December 31, 2024, compared to 130 in the previous year[64] - Total employee costs for the financial year amounted to approximately HKD 89 million, up from HKD 65.9 million in the previous financial year[64] Risk Management - The group closely monitors foreign exchange risks and may consider hedging significant foreign exchange risks when necessary[41] - The company faces risks related to consumer preferences and spending patterns, which could significantly impact its business and financial performance[67] Related Party Transactions - The total amount of related party transactions disclosed did not exceed the set annual cap, except for the previously mentioned excess[128] - The company has not engaged in any other related party transactions during the fiscal year, aside from those disclosed[125] Acquisitions and Investments - The group completed the acquisition of 12% equity in 康寧行 for a total consideration of HKD 9.1 million on May 31, 2023, increasing ownership to 61%[44] - On March 28, 2024, the group further acquired an additional 9% equity in 康寧行 for HKD 6.8 million, raising total ownership to 70%[45] - The company plans to acquire the remaining 51% of CWA Group for a cash settlement of HKD 106.0 million due to a triggered put option[177] Compliance and Legal - The company has established compliance and risk management policies, ensuring adherence to significant legal and regulatory requirements[173] - The company has committed to environmental protection and has complied with all relevant environmental laws during the fiscal year[172]

Financial Performance - The company's revenue for the fiscal year ending December 31, 2024, was HKD 876.0 million, a decrease of 26.9% compared to HKD 1,198.6 million for the fiscal year ending December 31, 2023[4]. - The net profit for the fiscal year 2024 was HKD 6.0 million, down 98.0% from HKD 297.3 million in 2023[4]. - EBITDA for the fiscal year 2024 was HKD 41.9 million, significantly lower than HKD 360.8 million in 2023[4]. - Adjusted net profit for the fiscal year 2024 was HKD 46.4 million, compared to HKD 114.8 million in 2023[4]. - The company reported a total comprehensive income of HKD 437,000 for 2024, a significant decline from HKD 302.6 million in 2023[5]. - The group reported total revenue of HKD 892,505,000 for 2024, a decrease from HKD 1,229,648,000 in 2023, representing a decline of approximately 27.4%[22]. - Adjusted profit before tax for the group was HKD 5,461,000 in 2024, a substantial decrease from HKD 317,696,000 in 2023, reflecting a decline of around 98.3%[22]. - The group's gross profit decreased by 27.5% to HKD 232.7 million for the fiscal year, with a gross margin decline of 0.2 percentage points to 26.6% due to rising commodity costs[61]. - Other income and net other gains for the fiscal year were HKD 4.8 million, a significant drop from HKD 209.0 million in the previous fiscal year, primarily due to the one-time gain from the sale of 51% equity in CWA[62]. - Profit attributable to equity holders was HKD 6.0 million, down from HKD 297.3 million in the previous fiscal year, mainly due to the absence of one-time gains from the sale of CWA and increased share-based payment expenses[63]. Revenue Breakdown - The distribution segment generated revenue of HKD 714,760,000 in 2024, slightly up from HKD 706,378,000 in 2023, indicating a growth of about 0.5%[22]. - The e-commerce segment reported a revenue of HKD 406,397,000 in 2024, while the retail segment generated HKD 176,388,000, compared to HKD 107,968,000 in 2023, showing significant growth in retail of approximately 63.5%[22]. - Revenue from Hong Kong increased to HKD 709,432,000 in 2024, up 13.7% from HKD 623,747,000 in 2023[25]. - Distribution sales in Hong Kong reached HKD 533.0 million, a year-on-year increase of 3.3%[44]. - Southeast Asia distribution sales surged to HKD 77.3 million, a significant increase of 59.8% year-on-year, with Singapore sales at HKD 65.6 million, up 56.9%[44]. - Revenue from Singapore, Malaysia, and other regions surged by 59.8% to HKD 77.3 million in fiscal year 2024, up from HKD 48.3 million in fiscal year 2023[60]. - Macau's revenue decreased by 20.8% to HKD 89.3 million in fiscal year 2024, down from HKD 112.7 million in fiscal year 2023, attributed to changes in consumer spending patterns[60]. Assets and Liabilities - Total assets as of December 31, 2024, amounted to HKD 1,005.6 million, an increase from HKD 988.9 million in 2023[7]. - Total liabilities increased to HKD 516.6 million in 2024 from HKD 445.4 million in 2023[8]. - The company's cash and cash equivalents decreased to HKD 34.0 million in 2024 from HKD 39.1 million in 2023[7]. - Total assets increased to HKD 1,005,563,000 in 2024 from HKD 988,951,000 in 2023, marking a growth of approximately 1.1%[23]. - The distribution segment's assets rose to HKD 616,720,000 in 2024, up from HKD 478,349,000 in 2023, indicating an increase of about 29.0%[23]. - The group’s total liabilities decreased to HKD 516,606,000 in 2024 from HKD 445,405,000 in 2023, representing an increase of approximately 15.9%[23]. Dividends and Shareholder Returns - The board has resolved not to declare any final dividend for the fiscal year 2024, compared to a dividend of HKD 0.035 per share in 2023[4]. - The company did not declare any dividends for 2024, compared to HKD 28,000,000 in 2023[34]. - The controlling shareholder's pledge of 200,000,000 shares will be released in July 2024 due to the achievement of the profit guarantee[94]. - The profit guarantee period has been extended to December 31, 2023, covering five financial years[91]. Corporate Governance and Compliance - The company is committed to maintaining high standards of corporate governance to protect shareholder interests[101]. - The company has adopted a code of conduct for securities trading by its directors, ensuring compliance with the standards set out in the listing rules[100]. - The company did not purchase, sell, or redeem any of its listed securities during the financial year[99]. Strategic Initiatives and Market Expansion - The group plans to leverage the updated free trade agreement with ASEAN to expand its product offerings in Southeast Asia, increasing competitiveness and tariff benefits[41]. - The group launched several new products in response to market demand, contributing to sales growth despite a challenging economic environment[41]. - The company is actively expanding its product offerings, including new products like "和漢匠心日本瘦身益生菌" and "金門強效一條根滲透鎮痛露"[49]. - The company has registered over 60 trademarks for its own brand products, with popular items including "和漢匠心日本多元益生菌" and "BG Pro博健專研免疫球蛋白丸"[48]. - The company has established procurement centers in various countries, including Japan, South Korea, and Southeast Asia, to diversify its product portfolio[51]. - The company has gained exclusive distribution rights for TJ-TYT Pharmaceuticals in Malaysia, significantly contributing to its sales network expansion[52]. - The company expects significant revenue growth in Thailand by the fiscal year ending December 31, 2025, following the acquisition of necessary licenses[53]. - The company plans to continue focusing on the development of Southeast Asian markets while maintaining its presence in Hong Kong and mainland China[56]. Employee and Operational Metrics - The number of employees increased to 260 as of December 31, 2024, compared to 130 in the previous year[95]. - Total employee costs for the financial year amounted to approximately HKD 89.0 million, up from HKD 65.9 million in the previous financial year[95]. Accounting and Financial Reporting - The group is currently evaluating the impact of new accounting standards, specifically HKFRS 18, which is expected to be adopted starting January 1, 2027[18]. - The group anticipates that the new accounting standards will have a significant impact on presentation and disclosure, particularly related to the consolidated income statement and other comprehensive income[18]. - The group’s management is assessing the adoption of other new accounting standards and interpretations that may affect current or future reporting periods[18]. - The group's financial statements for the year ended December 31, 2024, have been confirmed to align with the audited consolidated financial statements by PwC[109]. Recent Developments and Changes - The company has appointed Mr. Hu Yang as a non-executive director effective January 10, 2025, following the resignation of Mr. Cao Weiyong[107]. - There have been no significant events affecting the group since the end of the financial year up to the date of this announcement[108].

Financial Performance - Total revenue for the first half of 2024 was HKD 435.01 million, a decrease of 34.7% compared to HKD 666.29 million in the same period of 2023[9]. - The company reported a net profit attributable to equity holders of HKD 21.01 million, down 76.0% from HKD 87.53 million in the previous year[9]. - EBITDA for the first half of 2024 was HKD 42.80 million, reflecting a 63.7% decrease from HKD 117.75 million in the same period of 2023[9][11]. - The gross profit margin decreased to 24.8% from 26.0% year-on-year, indicating a decline in profitability[9]. - Net profit significantly dropped by 75.7% to HKD 21.1 million, down from HKD 87.0 million in the first half of 2023, primarily due to a lack of fair value gains from financial assets and a decline in operational net profit[17]. - The group recorded a net profit of HKD 21,119,000 for the period, down from HKD 87,047,000 in 2023, indicating a decrease of around 75.8%[98]. - The company reported a net loss of HKD 1,513,000 for the six months ended June 30, 2024, compared to a profit of HKD 87,528,000 in the same period of 2023[79]. Revenue Breakdown - Distribution revenue declined by 10.6% to HKD 335.22 million, while retail store revenue surged by 534.9% to HKD 99.79 million[9]. - Hong Kong distribution sales decreased to HKD 258.6 million, a year-on-year decline of 9.4%, while Macau distribution sales fell by 24.8% to HKD 45.2 million; however, Southeast Asia distribution sales grew by 27.7% during the same period[17]. - In Singapore, distribution sales reached HKD 28.0 million, up 30.4% from HKD 21.5 million year-on-year, while Southeast Asia distribution sales increased by 27.7%[26]. - The group reported external customer revenue of HKD 343,798,000 for the distribution segment, a decrease from HKD 398,565,000 in 2023, representing a decline of approximately 13.7%[98]. - E-commerce segment revenue reached HKD 101,122,000, compared to HKD 275,420,000 in the previous year, indicating a significant increase of approximately 36.7%[98]. Assets and Liabilities - Total assets increased by 2.4% to HKD 1,012.53 million, while total liabilities rose by 5.1% to HKD 468.16 million[10]. - Total assets as of June 30, 2024, were HKD 1,012,526,000, an increase from HKD 988,951,000 at the end of 2023[78]. - Total liabilities rose to HKD 468,159,000, compared to HKD 445,405,000 at the end of 2023[78]. - The company’s total equity increased to HKD 544,367,000 as of June 30, 2024, compared to HKD 543,546,000 at the beginning of the year[79]. Cash Flow and Financing - Cash and cash equivalents as of June 30, 2024, were approximately HKD 45.3 million, an increase from HKD 39.1 million at the end of 2023[31]. - The company incurred a cash outflow of HKD 20,400,000 for the repurchase of shares under the share award scheme during the reporting period[80]. - The company’s financing activities generated a net cash inflow of HKD 24,771,000, contrasting with a net outflow of HKD 27,902,000 in the previous year[80]. - The company had bank borrowings of HKD 200,626,000 as of June 30, 2024, an increase from HKD 139,028,000 as of December 31, 2023[118]. Strategic Initiatives - The company is adapting its strategies in response to the challenging operating environment, particularly due to reduced consumer spending from mainland Chinese tourists[15]. - The group plans to launch multiple new products in the second half of the year, including upgraded versions of popular items and new products tailored to market demand[21]. - The group continues to focus on a dual-channel approach, integrating online and offline sales to maintain competitive advantages in the market[14]. - The group plans to focus resources on high-margin private label products and expand its international business, particularly in Southeast Asia, expecting further revenue growth[24]. Shareholder Information - The board of directors did not recommend any interim dividend for the review period, compared to HKD 0.035 per share in the same period last year[49]. - The company has a significant short position of 200,000,000 shares, which is 25.00% of the total shares held by Tycoon Empire[63]. - The company has issued a total of 800,000,000 shares as of June 30, 2024, which is used to calculate approximate percentages[64]. - The company has not utilized any derivative financial instruments to hedge against foreign exchange risks during the review period[34]. Employee and Governance - The total number of employees in the group increased to 250 as of June 30, 2024, up from 208 a year earlier, with total employee costs amounting to approximately HKD 31.5 million[48]. - The company has complied with the corporate governance code, except for the separation of roles between the chairman and the CEO[52]. - The company has adopted its own code of conduct for securities trading by directors, which is not less stringent than the standard code outlined in the listing rules[54].

Financial Performance - The group's revenue for the first half of 2024 was HKD 435.0 million, a decrease of 34.7% compared to HKD 666.3 million in the same period of 2023[2] - Gross profit for the first half of 2024 was HKD 107.8 million, down 37.7% from HKD 173.1 million in the first half of 2023[2] - Net profit for the first half of 2024 was HKD 21.1 million, a decline of 75.7% from HKD 87.0 million in the first half of 2023[2] - The group reported a total comprehensive income of HKD 20.4 million for the first half of 2024, compared to HKD 85.5 million in the same period of 2023[3] - The adjusted profit before tax for the group was HKD 21,119 thousand for the first half of 2024, down from HKD 87,047 thousand in the same period of 2023, representing a decline of 75.8%[15] - The company reported a net profit attributable to equity holders of HKD 21,009 for the six months ended June 30, 2024, a decline of 76.0% from HKD 87,528 in 2023[22] - The group recorded revenue of approximately HKD 435.0 million for the fiscal year ending December 31, 2023, a decrease of 34.7% compared to HKD 666.3 million in the previous year[35] - Net profit significantly dropped by 75.7% to HKD 21.1 million, down from HKD 87.0 million in the first half of 2023, primarily due to a lack of fair value gains from financial assets and decreased operational net profit[35] Dividends and Shareholder Returns - The board has resolved not to declare any interim dividend for the first half of 2024 (interim dividend for the first half of 2023: HKD 0.035)[2] - The company did not declare any dividends for the six months ended June 30, 2024, compared to HKD 0.035 per share in 2023[25] - The board does not recommend any interim dividend for the review period, compared to HKD 0.035 per share in the same period last year[66] Assets and Liabilities - Total current assets increased to HKD 695.9 million as of June 30, 2024, compared to HKD 666.6 million as of June 30, 2023[5] - Total assets amounted to HKD 1,012.5 million as of June 30, 2024, compared to HKD 988.9 million as of June 30, 2023[7] - Total liabilities increased to HKD 468.2 million as of June 30, 2024, from HKD 445.4 million as of June 30, 2023[7] - The company's equity attributable to shareholders was HKD 536.9 million as of June 30, 2024, compared to HKD 536.2 million as of June 30, 2023[7] - The group’s total liabilities decreased to HKD 468,159 thousand as of June 30, 2024, from HKD 445,405 thousand as of December 31, 2023[16] Revenue Segmentation - The distribution segment reported revenue of HKD 343,798 thousand for the first half of 2024, down from HKD 398,565 thousand in the same period of 2023, reflecting a decrease of 13.7%[15] - The e-commerce segment generated revenue of HKD 101,122 thousand for the first half of 2024, compared to HKD 15,719 thousand in the same period of 2023, indicating significant growth[15] - The retail store segment reported revenue of HKD 99,794 thousand for the first half of 2024, compared to HKD 15,719 thousand in the same period of 2023, showing substantial improvement[15] - Revenue from the Hong Kong market increased to HKD 358,406, up 19.0% from HKD 301,011 in the previous year[18] - Revenue in Hong Kong increased by 19.1% to HKD 358.4 million, driven by the accounting impact of the acquisition of 康寧行[43] - Revenue in Singapore rose by 30.4% to HKD 28.0 million, compared to HKD 21.5 million in the previous year, due to ongoing development and sales expansion efforts[41] Operational Insights - The group’s operating segments include distribution, e-commerce, and retail store, with performance monitored separately for resource allocation and evaluation[13] - The company plans to launch multiple new products in the second half of 2024, including upgraded versions of popular items[38] - The company has established procurement centers in various countries, including Japan, South Korea, and several Southeast Asian nations, to diversify its product offerings[40] - The company aims to focus resources on higher-margin private label products and expand its international business, particularly in Southeast Asia[42] Market Conditions and Strategic Moves - The group continues to adapt its strategies in response to the challenging operating environment, focusing on expanding offline retail channels[35] - The health supplement market is expected to grow due to increasing health awareness and favorable policies in the Greater Bay Area[62] - The number of visitors to Hong Kong increased by 78% year-on-year to approximately 18 million in the first five months of 2024, although average spending per visitor dropped significantly[33] - The retail sales value of traditional Chinese medicine products in Hong Kong decreased by over 15.9% in the first half of 2024[33] Corporate Governance and Compliance - The company is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance corporate value[67] - The audit committee has reviewed the unaudited condensed consolidated financial statements for the review period, confirming they are prepared in accordance with applicable accounting standards[70] - The company has adopted a set of securities trading rules for its directors, which are not less stringent than the standard rules outlined in the listing rules[69] Employee and Operational Costs - The total number of employees as of June 30, 2024, is 250, an increase from 208 employees as of June 30, 2023[65] - Employee costs for the review period amounted to approximately HKD 31.5 million, compared to HKD 30.9 million in the same period last year[65] Investments and Acquisitions - The group acquired a 61% stake in 康寧行 in May 2023, which was further increased to 70% in March 2024, integrating its performance into the group's financial results[35] - The company completed the sale of 51% equity in CWA on September 30, 2023[59] - The group completed the sale of 51% of CWA for a total consideration of HKD 130 million, effective September 30, 2023, resulting in CWA no longer being consolidated in the group's financial statements[57]

Financial Performance - Total revenue for the fiscal year ended December 31, 2023, was approximately HKD 1,198.6 million, a year-on-year increase of 1.1%[25] - Net profit surged to HKD 297.3 million, representing a year-on-year growth of 579.6%[25] - Gross profit increased to HKD 321.1 million, with a gross profit margin of 26.8%, up from 22.0% in the previous year[25] - EBITDA for the fiscal year was HKD 360.8 million, with an EBITDA margin of 30.1%, compared to 6.7% in the previous year[25][27] - Return on equity (ROE) improved to 54.7%, up from 14.9% in the previous year[25] - Other income and net other gains amounted to HKD 209.0 million, significantly up from a loss of HKD 2.4 million in the previous fiscal year, mainly due to the sale of 51% stake in CWA[50] - Profit attributable to equity holders for the fiscal year 2023 was HKD 297.3 million, a substantial increase from HKD 43.8 million in fiscal year 2022[51] - Cash and cash equivalents as of December 31, 2023, were approximately HKD 39.1 million, down from HKD 74.6 million a year earlier[53] - The debt-to-equity ratio improved to 23.8% as of December 31, 2023, compared to 47.6% in the previous year, due to a higher percentage increase in total equity than in net debt[53] Sales and Market Expansion - Sales in Hong Kong reached HKD 623.7 million, a significant increase of 94.0% year-on-year, while sales in Macau grew by 19.1%[31] - Southeast Asia market sales reached HKD 41.8 million, with overall distribution sales in the region increasing by 151.6% year-on-year[33] - The company has established a presence in Southeast Asia, with exclusive distribution rights in Malaysia for Tianjin Tongrentang Pharmaceutical Co., Ltd.[32] - The group plans to invest more resources in the Southeast Asian market, focusing on Singapore and Malaysia distribution[33] - Revenue from Hong Kong surged by 94.0% to HKD 623.7 million, while revenue from Macau rose by 19.1% to HKD 112.7 million due to the resumption of normal travel between mainland China and Hong Kong[49] - Revenue from mainland China decreased by 44.9% to HKD 413.9 million, primarily due to the sale of 51% stake in CWA, effective from October 2023[49] Product Development and Marketing - The company continues to optimize its product mix and expand its own brand offerings in response to market trends[31] - The company plans to enhance its own brand development, launching new products under brands like "BG Pro" and "Craft by Wakan" to capture a broader market[43] - The company is collaborating with celebrities to promote its brands, enhancing its marketing efforts and brand recognition[43] - The company is optimistic about the sales prospects for hair care products due to increasing consumer awareness and an aging population[42] - The company aims to expand its market presence in Southeast Asia, particularly in Singapore and Malaysia, leveraging existing partnerships with major retail chains[44] Dividends and Shareholder Returns - The company declared a final dividend of HKD 0.035 per share for the fiscal year, compared to HKD 0.03 per share in the previous year[31] - The mid-term dividend of HKD 0.035 per share was paid on October 30, 2023, with a proposed final dividend of HKD 0.035 per share for the year ending December 31, 2023, subject to shareholder approval[70] - The company declared a final dividend of HKD 0.035 per share for the year ending December 31, 2023, compared to HKD 0.03 in 2022, resulting in a total annual dividend of HKD 0.07 per share[89] Corporate Governance - The company has appointed at least three independent non-executive directors, ensuring compliance with listing rules and maintaining shareholder interests[94] - The board consists of eight members, including one executive director, four non-executive directors, and three independent non-executive directors[165] - The board held six meetings during the fiscal year to review financial and operational performance and discuss future strategies[167] - The company has complied with all corporate governance code provisions during the fiscal year, except for a specific deviation explained in the report[164] - The corporate governance committee is responsible for formulating and reviewing the company's governance policies and practices[162] Risk Management - The company is aware of its responsibilities regarding risk management and internal control systems, which are designed to manage risks rather than eliminate them[191] - The audit committee assists the board in overseeing the effectiveness of risk management and internal control systems, with an annual review conducted for the fiscal year[193] - The company has established various risk management procedures and guidelines, ensuring adequate internal controls across key business processes[193] Employee and Operational Insights - The group reported a total employee cost of approximately HKD 65.9 million for the fiscal year, an increase from HKD 53.7 million in the previous fiscal year[69] - The total number of employees as of December 31, 2023, was 130, down from 179 as of December 31, 2022[69] - The company has adopted share incentive and stock option plans to motivate and recognize employee contributions[69] Related Party Transactions - The company has complied with the disclosure requirements of the listing rules regarding related party transactions[100] - The annual cap for related party transactions with China Resources Pharmaceutical for purchases and sales is set at HKD 1,300 million and HKD 432 million, respectively, with actual transaction amounts of approximately HKD 145.2 million and HKD 29.8 million as of December 31, 2023[103] - The company has entered into a lease agreement with its executive director and major shareholder, Mr. Wang, for properties in Shatin, with a monthly rent of HKD 289,500 for a two-year term starting January 1, 2022[109] Strategic Acquisitions and Investments - The company completed the sale of 51% equity in CWA for a total consideration of HKD 130,000,000 on September 30, 2023[60] - The company acquired an additional 12% stake in 康寧行 for HKD 9.12 million, increasing its total ownership to 61%[42] - The company’s investment in Jianbei Miao Miao consists of 55,000,000 shares, representing 6.35% of its equity, with an investment cost of HKD 51.3 million[65] Future Outlook - The management provided guidance for the upcoming quarter, projecting a revenue increase of 10% to $165 million[80] - The company aims to become a leading supplier of health and wellness products through diversified online and offline sales channels[161] - The company is expanding its market presence in Southeast Asia, targeting a 30% growth in that region over the next two years[75]

Financial Performance - The group's revenue for the fiscal year ended December 31, 2023, was HKD 1,198.6 million, an increase of 1.1% compared to HKD 1,186.2 million for the fiscal year ended December 31, 2022[2]. - Gross profit for the fiscal year 2023 was HKD 321.1 million, up 22.8% from HKD 261.5 million in 2022, with a gross margin increase from 22.0% to 26.8%[2]. - Net profit for the fiscal year 2023 surged to HKD 297.3 million, a significant increase of 581.4% from HKD 43.6 million in 2022[2]. - Operating profit for the fiscal year 2023 was HKD 336.6 million, compared to HKD 64.9 million in 2022[3]. - The group reported a total comprehensive income of HKD 302.6 million for the fiscal year 2023, compared to HKD 39.7 million in 2022[4]. - Adjusted profit before tax for the group reached HKD 317,696,000, compared to HKD 50,367,000 in the previous year, indicating a significant increase of approximately 530.5%[14]. - The company reported a net profit attributable to equity holders of HKD 297,319,000 for 2023, compared to HKD 43,750,000 in 2022, marking a substantial increase of 579%[26]. - Basic earnings per share rose to HKD 0.38 in 2023 from HKD 0.06 in 2022, reflecting a significant improvement in profitability[26]. - The company incurred total tax expenses of HKD 20,373,000 in 2023, compared to HKD 6,736,000 in 2022, reflecting an increase in tax liabilities due to higher profits[24]. Revenue Breakdown - The group reported total revenue of HKD 1,229,648,000 for 2023, a slight increase from HKD 1,220,973,000 in 2022, representing a year-over-year growth of approximately 0.8%[14]. - Revenue from mainland China decreased significantly to HKD 413,892,000 in 2023 from HKD 750,878,000 in 2022, a decline of 45%[17]. - Revenue from Hong Kong increased to HKD 623,747,000 in 2023, up 94% from HKD 321,552,000 in 2022[17]. - The distribution segment generated revenue of HKD 706,378,000 in 2023, up from HKD 482,300,000 in 2022, reflecting a growth of about 46.7%[14]. - E-commerce segment revenue was HKD 406,397,000 in 2023, down from HKD 738,673,000 in 2022, showing a decline of approximately 45%[14]. - Retail store segment revenue increased to HKD 116,873,000 in 2023 from HKD 0 in 2022, marking a successful launch of this segment[14]. Dividends and Shareholder Returns - The board proposed a final cash dividend of HKD 0.035 per share for the fiscal year 2023, totaling HKD 0.07 per share including the interim dividend, compared to HKD 0.03 per share in 2022[2]. - The company declared a final dividend of HKD 0.035 per share for 2023, totaling HKD 28 million, compared to no dividend in 2022[28]. Assets and Liabilities - Total assets as of December 31, 2023, were HKD 988.9 million, a decrease from HKD 1,012.1 million in 2022[5]. - Total liabilities decreased to HKD 445.4 million in 2023 from HKD 718.9 million in 2022[7]. - The company's equity attributable to shareholders increased to HKD 536.2 million in 2023 from HKD 293.6 million in 2022[7]. - Trade receivables decreased to HKD 236.6 million in 2023 from HKD 256.2 million in 2022, indicating improved collection efficiency[29]. - The company’s trade payables decreased to HKD 156.7 million in 2023 from HKD 302.8 million in 2022, reflecting better cash flow management[31]. Strategic Initiatives and Market Expansion - The company is focusing on expanding into Southeast Asian markets and upgrading its own brands and product offerings[38]. - The company has established procurement centers in multiple countries, enhancing its product diversity and international presence[45]. - The focus on promoting self-owned brands in Southeast Asia aims to leverage the company's distribution channels and logistics advantages[45]. - The company plans to strengthen its presence in Southeast Asia, particularly in Singapore and Malaysia, to drive future revenue growth[46]. - The company has established a strong online and offline sales network, supplying over 1,500 products from more than 200 local and overseas brands[35]. Corporate Governance and Compliance - The company has adopted a code of conduct for directors regarding securities trading, which complies with the standards set out in the listing rules[75]. - The company has fully complied with the corporate governance code during the fiscal year, except for the separation of roles between the Chairman and the CEO[75]. - The audit committee reviewed the group’s accounting principles and internal controls, and the audited consolidated financial statements for the fiscal year[76]. - The chairman and CEO, Mr. Wang, has been responsible for the overall strategic planning and management since the group's establishment[75]. - The board of directors includes one executive director, four non-executive directors, and three independent non-executive directors[78]. Future Outlook - The company expects that the newly adopted accounting standards will not have a significant impact on current or future periods[11]. - The company anticipates a recovery in offline distribution business to pre-pandemic levels, with increased demand for traditional Chinese medicine products[46]. - The company plans to hold its annual general meeting on May 31, 2024[70].

Financial Performance - Total revenue for the first half of 2023 reached HKD 666.3 million, a 13.3% increase from HKD 588.2 million in the same period of 2022[18]. - Distribution revenue grew by 28.6% to HKD 375.1 million, while e-commerce revenue decreased by 7.1% to HKD 275.4 million[18]. - Gross profit increased by 34.9% to HKD 173.1 million, with a gross margin of 26.0%, up from 21.8% in 2022[18]. - Profit attributable to equity holders surged by 289.5% to HKD 87.5 million, resulting in a profit margin of 13.1% compared to 3.8% in the previous year[18]. - EBITDA for the first half of 2023 was HKD 117.7 million, a significant increase of 178.0% from HKD 42.4 million in 2022[18]. - Net profit surged to HKD 87.0 million, a significant increase of 281.9% compared to HKD 22.8 million in the first half of 2022[26]. - Profit before tax increased significantly to HKD 96,514,000, compared to HKD 29,437,000 in the previous year, marking a growth of 227.5%[80]. - Basic earnings per share for the six months ended June 30, 2023, was HKD 11, up from HKD 3 for the same period in 2022, indicating a significant increase of 266.7%[119]. Assets and Liabilities - Total assets as of June 30, 2023, amounted to HKD 1,187.8 million, reflecting a 17.4% increase from HKD 1,012.1 million at the end of 2022[19]. - Total liabilities increased by 11.4% to HKD 801.0 million, while total equity rose by 31.9% to HKD 386.8 million[19]. - Cash and cash equivalents as of June 30, 2023, were approximately HKD 70.5 million, down from HKD 74.6 million at the end of 2022[42]. - The debt-to-equity ratio improved to 40.8% from 47.6% as total equity growth outpaced net debt growth[42]. - Total current liabilities increased to HKD 787,438 thousand as of June 30, 2023, compared to HKD 714,777 thousand at the end of 2022, representing a growth of 10.1%[82]. - Total equity surged to HKD 386,777 thousand as of June 30, 2023, up from HKD 293,160 thousand, reflecting a significant increase of 31.9%[82]. Market and Sales Growth - The retail market in Hong Kong showed signs of recovery, with retail sales in the first half of 2023 reaching HKD 205.1 billion, approximately 85% of the levels seen in the same period of 2019[24]. - The company anticipates continued growth in offline sales driven by the recovery of inbound tourism and upcoming traditional peak consumption seasons[25]. - Hong Kong distribution sales increased by 28.0%, while Macau distribution sales rose by 10.9% in the first half of 2023[28]. - Southeast Asia distribution sales saw a remarkable growth of 114.2% year-on-year in the first half of 2023[28]. - Revenue from Hong Kong rose by 35.0% to HKD 301.0 million, while revenue from Macau increased by 10.9% to HKD 60.1 million due to the resumption of normal travel between mainland China and Hong Kong[38]. Strategic Developments - The group plans to utilize proceeds from the sale of 51% stake in Combo Win Asia Limited to enhance distribution efforts in Hong Kong, Macau, and Southeast Asia[26][28]. - The group has secured exclusive agency rights for several international brands, including Culturelle® and Kaminowa, enhancing its product portfolio[31]. - The group is actively developing its own brands, including Boost & Guard Pro and Craft by Wakan, to meet the rising demand from travelers and market trends[32]. - The group has established procurement centers in various countries, including Japan and Malaysia, to diversify its product offerings and enhance international presence[33]. - The company plans to expand its business in the Greater Bay Area and Southeast Asia, focusing on health and lifestyle products[36]. Employee and Governance - The total employee cost for the group was approximately HKD 30.9 million for the review period, up from HKD 27.8 million in the previous year[54]. - The group had no significant capital commitments or contingent liabilities as of June 30, 2023[51]. - The company has adopted the Corporate Governance Code and has complied with its provisions, except for the separation of roles between the Chairman and the CEO[60]. - The Chairman and CEO roles are currently held by the same individual, which the board believes does not impair the balance of power and authority[60]. - The group has a total of 208 employees across various regions, an increase from 174 employees a year ago[54]. Acquisitions and Investments - The group acquired an additional 12% stake in 康寧行有限公司 for HKD 9.12 million, bringing total ownership to 61%[30]. - The company completed the acquisition of 12% of the issued shares of 康寧行 for a total consideration of HKD 9,120,000, increasing its ownership to 61%[48]. - 康寧行 contributed revenue of HKD 15,719,000 and net profit of HKD 511,000 from May 31, 2023, to the interim consolidated income statement[156]. - The fair value of identifiable assets acquired from 康寧行 totaled HKD 52,444,000, including intangible assets of HKD 15,700,000 and trade receivables of HKD 34,040,000[154]. - A sale agreement was signed on July 7, 2023, to sell 51% of Combo Win Asia Limited for HKD 130,000,000, pending certain conditions[157]. Shareholder Information - As of June 30, 2023, the Chairman holds approximately 56.01% of the company's shares[64]. - The total number of shares issued as of June 30, 2023, is 800,000,000[69]. - No stock options were granted or exercised under the stock option plan during the review period, with a total of 80,000,000 shares potentially issuable upon exercise, representing 10% of the issued shares[73]. - The share award plan allows for a maximum of 40,000,000 shares to be granted, which is 5% of the total issued share capital at the time of adoption[74]. - The company aims to attract suitable talent and retain employees through the share award plan[74].

Financial Performance - The group's revenue for the six months ended June 30, 2023, was HKD 666.3 million, an increase of 13.3% compared to HKD 588.2 million for the same period in 2022[2]. - Gross profit for the first half of 2023 was HKD 173.1 million, up 34.9% from HKD 128.4 million in the first half of 2022[2]. - Net profit for the first half of 2023 was HKD 87.0 million, a significant increase of 281.9% from HKD 22.8 million in the first half of 2022[2]. - Adjusted profit before tax for the group was HKD 96,514,000, compared to HKD 29,437,000 in the previous year, indicating a significant increase of approximately 227.5%[16]. - The company reported a basic and diluted earnings per share of HKD 0.11 for the first half of 2023, compared to HKD 0.03 for the same period in 2022[4]. - The group achieved a profit of HKD 87,047,000 for the period, a substantial increase from HKD 22,795,000 in the previous year, marking a growth of approximately 281.5%[16]. - The company recorded a total tax expense of HKD 9,467,000 for the six months ended June 30, 2023, compared to HKD 6,642,000 in the same period of 2022, representing an increase of about 42.5%[23]. - Basic earnings per share for the six months ended June 30, 2023, increased to 11 HK cents from 3 HK cents for the same period in 2022, representing a growth of 266.67%[24]. - The diluted earnings per share for the six months ended June 30, 2023, remained at 11 HK cents, consistent with the basic earnings per share due to the anti-dilutive effect of share awards in the previous period[26]. Dividends - The board has declared an interim dividend of HKD 0.035 per ordinary share for the first half of 2023, compared to no dividend in the first half of 2022[2]. - The interim dividend declared for the six months ended June 30, 2023, is 3.5 HK cents per share, compared to no dividend for the same period in 2022[27]. Assets and Liabilities - Total current assets as of June 30, 2023, amounted to HKD 938.4 million, an increase from HKD 829.7 million as of December 31, 2022[5]. - Total assets increased to HKD 1,187.8 million as of June 30, 2023, from HKD 1,012.1 million as of December 31, 2022[5]. - Total liabilities as of June 30, 2023, were HKD 801.0 million, compared to HKD 718.9 million as of December 31, 2022[7]. - The total liabilities decreased to HKD 801,017,000 as of June 30, 2023, from HKD 718,957,000 as of December 31, 2022, indicating a reduction of approximately 11.4%[17]. - The company’s cash and cash equivalents stood at approximately HKD 70.5 million as of June 30, 2023, compared to HKD 74.6 million at the end of 2022[52]. - The debt-to-equity ratio improved to 40.8% from 47.6% as of December 31, 2022, due to a higher percentage increase in total equity compared to net debt[52]. Revenue Segmentation - The distribution segment generated revenue of HKD 398,565,000, slightly up from HKD 389,982,000 year-on-year, reflecting a growth of about 0.2%[16]. - The e-commerce segment reported revenue of HKD 275,420,000, down from HKD 296,331,000 in the previous year, showing a decline of approximately 7.0%[16]. - The retail store segment contributed HKD 15,719,000 in revenue, with no prior year comparison available due to the acquisition of a subsidiary[16]. - The company achieved a geographical revenue breakdown with Hong Kong contributing HKD 301,011,000 and mainland China contributing HKD 280,315,000 for the six months ended June 30, 2023[20]. - Revenue from Hong Kong rose by 35.0% to HKD 301.0 million, while revenue from Macau increased by 10.9% to HKD 60.1 million[48]. - Revenue from mainland China decreased by 6.8% to HKD 280.3 million, down from HKD 300.9 million in the previous year[48]. - Other markets, including Singapore, saw a significant revenue increase of 146.5% to HKD 24.9 million[48]. Operational Highlights - The group is primarily engaged in the distribution and retail of health and lifestyle-related products[9]. - The group recognized a gain of HKD 10,000,000 from the sale of a joint venture during the reporting period[16]. - The group’s financial income increased to HKD 140,000 from HKD 3,000 in the previous year, reflecting a significant rise[16]. - The group’s financial costs, excluding lease liabilities, rose to HKD 11,736,000 from HKD 3,785,000, indicating an increase of approximately 209.5%[16]. - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[20]. - The company plans to enhance its distribution business in Southeast Asia, particularly in Malaysia and Singapore, leveraging successful models from Hong Kong[44]. - The company aims to introduce more overseas popular brands to the Hong Kong, Macau, and China markets, capitalizing on the post-pandemic recovery[45]. Employee and Operational Costs - Employee benefit expenses rose to HKD 30,898,000 for the six months ended June 30, 2023, compared to HKD 27,841,000 in the same period of 2022, reflecting an increase of approximately 7.4%[21]. - The group has a total employee count of 208 as of June 30, 2023, up from 174 a year earlier, with total employee costs amounting to approximately HKD 30.9 million[64]. Strategic Investments and Acquisitions - The company has entered into a sale agreement to sell 51% of Combo Win Asia Limited for a total consideration of 130,000,000 HKD, pending the fulfillment of certain conditions[33]. - The company plans to utilize proceeds from the sale of 51% of Combo Win Asia Limited for further investment in distribution business in Hong Kong, Macau, and Southeast Asia[37]. - The company acquired an additional 12% stake in 康寧行有限公司 for HKD 9.12 million, increasing its total ownership to 61%[40]. - The group completed the acquisition of a 12% stake in 康寧行 for a total consideration of HKD 9,120,000 on May 31, 2023, increasing its ownership to 61%[57]. - The investment in 健倍苗苗 represents 6.02% of its equity, with an investment cost of HKD 52.3 million, and the fair value of this investment as of June 30, 2023, was HKD 70.4 million[58][60]. - The fair value gain from financial assets measured at fair value through profit or loss for the investment in 健倍苗苗 was HKD 19.1 million for the six months ended June 30, 2023[60]. Governance and Compliance - The company has adopted a corporate governance code to enhance shareholder value and accountability, fully complying with the relevant provisions during the review period, except for a specific deviation[68]. - The roles of the Chairman and CEO are not separated, with Mr. Wang Jia Jun holding both positions, which the board believes does not impair the balance of power[68]. - The audit committee has reviewed the unaudited condensed consolidated financial statements for the review period, confirming they are prepared in accordance with applicable accounting standards[70]. - The mid-term report will be published on the Hong Kong Stock Exchange and the company's website, containing all information required by listing rules[71].

Company Information - The company is registered in the Cayman Islands and trades under stock code 3390[1] - The board of directors consists of one executive director and seven non-executive directors, including three independent non-executive directors[1] - The board is chaired by Wang Jia Jun, who is also the CEO[1] Financial Disclosure - The announcement serves as supplementary information to the 2022 annual report, which remains unchanged except for the disclosed details[1] - The announcement does not affect other information contained in the 2022 annual report[1] - The announcement includes details related to the share incentive plan as disclosed in the annual report[1] Share Options - The weighted average closing price of shares granted to other grantees before the vesting date was HKD 1.27[1] - The announcement was made on August 25, 2023, providing additional details regarding the unexercised share options for the fiscal year[1] Regulatory Information - The announcement clarifies that the Hong Kong Exchanges and Clearing Limited and the Hong Kong Stock Exchange do not accept responsibility for the content[1] - The company aims to provide accurate and complete information in its disclosures[1]