Financial Performance - Total revenue for the six months ended June 30, 2021, was HKD 380.66 million, a 107.3% increase from HKD 183.63 million in the same period of 2020[6] - Gross profit rose by 97.5% to HKD 71.49 million, with a gross margin of 18.8%[6] - The company reported a loss attributable to equity holders of HKD 10.97 million, a 77.3% improvement from a loss of HKD 48.36 million in the prior year[6] - Adjusted EBITDA was HKD 2.17 million, compared to a loss of HKD 23.47 million in the same period last year[6] - The group reported a net loss of HKD 10,198,000 for the period, down from HKD 48,358,000 in the previous year, representing a decrease of 78.9%[107] - The overall loss before tax for the company narrowed to HKD 9,881,000 in 2021 from HKD 51,314,000 in 2020, a reduction of 80.7%[107] Revenue Breakdown - E-commerce revenue surged by 261.6% to HKD 231.12 million, compared to HKD 63.92 million in the previous year[6] - Distribution revenue increased by 26.4% to HKD 147.08 million, up from HKD 116.31 million year-on-year[6] - Revenue from mainland China surged by 260.6% to HKD 230.5 million, driven by the easing of travel restrictions to Hong Kong[26] - Revenue in Hong Kong decreased by 9.0% to HKD 98.4 million due to the impact of COVID-19 and the closure of major transit points[26] - Revenue from Macau and other markets rose significantly by 347.5% to HKD 51.8 million, attributed to the acquisition of an 80% stake in a Macau distributor[26] Assets and Liabilities - Total assets increased by 11.8% to HKD 693.29 million, while total liabilities rose by 24.9% to HKD 411.53 million[7] - The group's debt-to-equity ratio increased to 77.3% from 68.3% at the end of 2020, mainly due to increased invoice financing[31] - Total current liabilities increased to HKD 404,994,000 as of June 30, 2021, compared to HKD 321,280,000 as of December 31, 2020, representing a 26% increase[71] - The company’s total liabilities rose to HKD 411,533,000 as of June 30, 2021, compared to HKD 329,471,000 as of December 31, 2020, marking a 25% increase[71] Market and Economic Conditions - The ongoing COVID-19 pandemic continues to impact the retail and distribution market in Hong Kong, with visitor numbers dropping by 99.1% year-on-year[13] - Approximately 60% of Hong Kong's population has received at least one COVID-19 vaccine dose, contributing to a stable environment for business recovery[19] - The company anticipates continued growth in the health and wellness sector due to heightened consumer awareness post-COVID-19[19] - The implementation of favorable policies in the Greater Bay Area is expected to create significant business opportunities for the company[22] Strategic Initiatives - The company aims to leverage its distribution channels in Macau to capitalize on economic recovery opportunities[14] - The company has obtained distribution rights for several new health products, including Culturelle® probiotics, which are expected to be a major driver of sales growth[16] - The company is expanding its product portfolio by establishing new subsidiaries in Japan and Thailand for quality health and beauty product distribution[18] - A joint venture with Jianbei Miaomiao aims to develop private label products, leveraging both companies' strengths in product development and distribution[18] - The company plans to enhance its e-commerce business by establishing more online stores and strengthening partnerships with major platforms like JD.com and Tmall.com[20] Shareholder Information - The company has a shareholding structure where the chairman and CEO roles are held by the same individual, which the board believes does not impair the balance of power[48] - As of June 30, 2021, the chairman held 448,096,326 shares (56.01%) and 200,000,000 shares (25.00%) in a controlled corporation[53] - Tycoon Empire holds 448,096,326 shares, representing 56.01% of the company's total shares, and has a short position of 200,000,000 shares, accounting for 25.00%[57] - The total issued share capital as of June 30, 2021, was HKD 100,000,000, with 10,000,000,000 ordinary shares issued at a par value of HKD 0.01 each[156] Employee and Operational Metrics - The total number of employees as of June 30, 2021, was 178, an increase from 167 in the previous year, with total employee expenses amounting to approximately HKD 25.6 million, up from HKD 19.6 million year-on-year[41] - The company incurred employee benefit expenses of HKD 25,608,000, up from HKD 19,552,000 in the previous year, reflecting an increase of 31%[131] Share Options and Awards - The company adopted a share option plan on March 23, 2020, allowing for the issuance of options up to 30% of the total issued share capital[158] - A share award plan was adopted on May 25, 2020, allowing for the issuance of shares up to 5% of the total issued share capital as of the adoption date, equating to 40,000,000 shares[163] - During the six months ended June 30, 2021, the company granted 10,348,000 shares under the share award plan, with no shares granted in the same period of the previous year[164]

Financial Performance - Total revenue for the fiscal year 2020 was HKD 505.99 million, a decrease of 27.8% compared to HKD 700.76 million in 2019[11]. - The company recorded a loss attributable to equity holders of HKD 61.13 million, a decline of 212.1% from a profit of HKD 54.52 million in 2019[7]. - Adjusted EBITDA was HKD (35.64) million, a decrease of 136.1% from HKD 98.62 million in the previous year[7]. - The group's revenue for the fiscal year 2020 was approximately HKD 506.0 million, a decrease of 27.8% from HKD 700.8 million in 2019, resulting in a loss of HKD 61.0 million compared to a profit of HKD 54.5 million in the previous year[24]. - Revenue from the distribution business decreased by 57.6% to HKD 274.3 million, down from HKD 646.9 million in 2019, while retail store revenue fell by 62.2% to HKD 7.0 million from HKD 18.5 million[31]. - Gross profit fell to HKD 83.8 million from HKD 191.1 million, with a gross margin decrease of 10.7 percentage points to 16.6%, attributed to a shift towards lower-margin e-commerce sales and increased competition in the market for pandemic-related products[36]. - General and administrative expenses increased by 70.3% to HKD 93.5 million from HKD 54.9 million, influenced by inventory write-offs and increased legal and compliance costs following the company's IPO[39]. - Shareholders' loss amounted to HKD 61.1 million, compared to a profit of HKD 54.5 million in the previous fiscal year[43]. E-commerce Growth - E-commerce revenue surged to HKD 224.69 million, representing a growth of 535.4% from HKD 35.36 million in the previous year[7]. - E-commerce sales revenue reached HKD 224.7 million, a sixfold increase from HKD 35.4 million in the previous fiscal year, reflecting the success of the dual online and offline sales strategy[27]. - The group's e-commerce revenue surged sixfold to HKD 224.7 million in the fiscal year, up from HKD 35.4 million in the previous fiscal year, primarily driven by increased online purchases from mainland Chinese consumers due to COVID-19 restrictions[32]. - The COVID-19 pandemic has shifted consumer behavior towards online shopping, leading to growth in the company's e-commerce business during this period[93]. - The company aims to strengthen its e-commerce presence by partnering with major platforms like JD.com and Tmall.com to expand its product distribution[93]. Business Expansion and Strategy - The company plans to expand its e-commerce operations by increasing the mainland e-commerce team and establishing more online stores[15]. - A joint venture with China Resources Pharmaceutical Group is expected to commence operations in Q2 2021, focusing on distributing quality health products in mainland China[15]. - The group plans to continue seeking and obtaining distribution rights for new health, skincare, and personal care products to diversify its product offerings[27]. - The group has expanded its workforce and office space in mainland China to support the growth of its e-commerce business[27]. - The group aims to leverage its existing distribution channels in Macau to benefit from the region's economic recovery[27]. - Future marketing strategies will focus on digital marketing and social media to promote the group's own brand products[97]. - The group plans to actively expand its O2O business model and enhance supply chain and retail management in mainland China[97]. - A new subsidiary has been established in Japan to negotiate exclusive operating and distribution rights for more quality health and beauty product brands[97]. Financial Position and Assets - Total assets increased by 69.2% to HKD 619.91 million from HKD 366.36 million in 2019[7]. - Total liabilities rose by 32.8% to HKD 329.47 million compared to HKD 248.00 million in 2019[7]. - As of December 31, 2020, the group held cash and bank balances of approximately HKD 119.3 million, up from HKD 50.4 million a year earlier, with a debt-to-equity ratio of 68.3%[47]. - The group's borrowings included secured bank loans of approximately HKD 92.9 million and unsecured bank loans of HKD 39.0 million as of December 31, 2020[48]. Shareholder Information and Dividends - The company declared a special dividend of HKD 0.02 per share for the fiscal year 2020[12]. - The board declared a special dividend of HKD 0.02 per share for the fiscal year, compared to a total dividend of HKD 50.0 million in the previous fiscal year[79]. - The board does not recommend any other dividends for the year ended December 31, 2020, aside from the special dividend[129]. - The company adopted a dividend policy effective from April 15, 2020, allowing for the declaration of interim or special dividends[130]. - As of December 31, 2020, the company's distributable reserves amounted to HKD 711.5 million, an increase from HKD 478.0 million in 2019[141]. Market Conditions and Challenges - The retail and distribution sectors faced significant challenges due to COVID-19, with a reported 50% decline in total sales value for drug and cosmetic retailers in Hong Kong[11]. - The total retail sales value of drugs and cosmetics in Hong Kong for the fiscal year 2020 was estimated at HKD 21.5 billion, a decline of 50.0% compared to the previous year[24]. - The number of visitors to Hong Kong in 2020 was 3.6 million, a significant drop of 93.6% from 55.9 million in 2019, severely impacting the retail market[20]. - The decline in offline sales was mitigated in the second half of the fiscal year, indicating a potential recovery trend[27]. - The company remains optimistic about the health industry outlook despite the challenges posed by the COVID-19 pandemic, anticipating increased demand for health and preventive products[91]. Acquisitions and Investments - The group acquired 80% of the shares in Jetfly Macau Limited, which holds a license for the import and wholesale of drugs in Macau, to expand its business in that region[28]. - The company agreed to acquire a 49% stake in Corning Holdings for HKD 41.7 million, enhancing its offline retail presence in Hong Kong and expanding sales channels[55]. - The acquisition of Corning Holdings is expected to increase market penetration and provide access to valuable market information for new product development[58]. - The company subscribed for shares in JBM Group for a total cash consideration of HKD 20.0 million, acquiring approximately 2.2% of JBM's issued shares[60]. - The strategic relationship with JBM Group is anticipated to broaden the product portfolio and enhance competitiveness in the health and wellness sector[60]. - The company acquired 80% of Jetfly for HKD 37.4 million, which is expected to leverage Jetfly's distribution channels in Macau[63]. - The acquisition of Jetfly will facilitate better access to consumers in Macau and strengthen the company's brand presence in the Greater Bay Area[64]. - Jetfly is required to achieve a net profit of at least HKD 14.0 million over two fiscal years to avoid price adjustments on the acquisition[65]. Corporate Governance and Compliance - The board expressed gratitude to shareholders for their continued support during a challenging year[128]. - The company has not entered into any management contracts with any individuals or entities for the management or operation of its business during the year ended December 31, 2020[157]. - The board confirmed that there were no interests held by directors in any business that competes or may compete with the group as of December 31, 2020[156]. - The company has purchased directors' liability insurance to provide appropriate protection for its directors[155]. - The company has complied with the disclosure requirements of the Listing Rules regarding related party transactions[158]. - The independent non-executive directors confirmed that the related transactions were conducted in the ordinary course of business and on normal commercial terms[169]. Risk Factors - The company has identified risks related to consumer preferences and spending habits, which could significantly impact its business and financial performance[86]. - The company has no foreign currency hedging policy, exposing it to currency risk from overseas procurement[87]. - The group is currently unable to accurately estimate the full impact of the pandemic on its operations but aims to return to pre-COVID-19 levels as soon as feasible[98]. - The group will continue to monitor the pandemic's development and explore acquisition opportunities cautiously[98].