Financial Performance - For the first three quarters of 2023, the group recorded revenue of RMB 776 million, remaining flat year-on-year, while the apparel business turned a profit of RMB 75 million, compared to a loss previously[17]. - Revenue for the six months ended September 30, 2023, was RMB 775,993 thousand, a slight decrease of 0.4% compared to RMB 776,339 thousand in the same period of 2022[152]. - Gross profit increased to RMB 536,439 thousand, up 10.8% from RMB 484,321 thousand year-over-year[152]. - Operating loss for the period was RMB 471,481 thousand, compared to a loss of RMB 367,353 thousand in the previous year, reflecting a 28.4% increase in losses[152]. - Net loss attributable to the owners of the company was RMB 409,713 thousand, compared to RMB 346,000 thousand in the same period last year, representing an increase of 18.4%[154]. - Total comprehensive loss for the period amounted to RMB 247,410 thousand, a significant decline from a gain of RMB 17,415 thousand in the prior year[154]. - The company reported a loss of RMB 409,713 thousand for the period, compared to a loss of RMB 346,000 thousand in the previous year, indicating a year-over-year increase in losses of about 18.4%[168]. - The company’s total comprehensive income for the period was a loss of RMB 247,410 thousand, compared to a gain of RMB 17,415 thousand in the previous year, indicating a substantial decline in comprehensive income[168]. Dividends and Shareholder Returns - The company declared a special interim dividend of RMB 0.71 per share, payable on December 22, 2023[5]. - The group proposed a special interim dividend of RMB 0.71 per share to reward shareholders for their continued support[17]. - Interim special dividend per share decreased by 39.3% to RMB 0.71 from RMB 1.17 year-on-year[74]. Market and Economic Conditions - China's GDP growth rate for 2023 is projected to be around 5%, significantly higher than the global average, positioning China as the largest engine of global economic growth[19]. - The domestic economic recovery is supported by a series of consumption-promoting policies, leading to a noticeable rebound in the consumer market[12]. - In the first three quarters of 2023, China's GDP grew by 5.2% year-on-year, with the third quarter showing a growth of 4.9%, exceeding market expectations[40]. - The Chinese government has implemented a series of consumption-promoting policies, resulting in a significant rebound in the domestic consumption market[40]. - Retail sales of sports goods in China reached 77.76 billion RMB in the first seven months of 2023, representing an annual increase of 11.4%[40]. - The retail sales of consumer goods in China increased by 6.8% year-on-year in the first three quarters of 2023, with upgraded goods sales growing by 12.2%[40]. Brand and Product Development - The new Kappa 1916 series draws inspiration from the brand's century-long history, aiming to attract younger consumers with retro sports fashion[10]. - The PHENIX brand, focusing on high-end professional skiing products, has sponsored the Tsinghua skiing team and launched custom team uniforms[10]. - The company continues to innovate in product design, focusing on professional competitive gear and expanding its market presence with new product lines[39]. - Kappa introduced several new product lines, including the Kappa 1916 series and Kappa Player series, targeting the new generation of trend-conscious consumers[45]. - Kappa's historical best-selling item, the combat pants, has been fully upgraded, emphasizing quality details with 22-piece stitching[45]. - The Kappa Gara series continues to integrate functional technology with fashion design, enhancing the brand's core competitiveness through the K-TECH technology platform[47]. Sustainability and ESG Initiatives - The company is committed to enhancing its ESG management system and optimizing its ESG strategies to create long-term value[9]. - Over 80% of surveyed companies in the global sports goods industry have announced or plan to set carbon reduction targets, indicating a significant trend towards sustainability[38]. - Kappa launched a special low-carbon training outfit made from Sorona eco-friendly fabric for the national fencing team, reflecting its commitment to sustainability[39]. Store and Channel Management - The company is enhancing its store quality and targeting higher-end consumer groups for greater growth opportunities[11]. - As of September 30, 2023, the total number of Kappa brand stores was 1,002, a net decrease of 21 stores compared to March 31, 2023[12]. - The group plans to enhance channel management efficiency and reduce operational costs to improve competitiveness[12]. Investment and Financial Position - The investment division's net assets amounted to RMB 8,565 million, reflecting a slight decrease of 2.0% from March 31, 2023[28]. - The group's investment segment reported a loss due to fluctuations in the capital market, resulting in a loss attributable to the company's owners of RMB 410 million, compared to a loss of RMB 346 million in the previous year[54]. - The company maintains a cautious investment strategy, with net assets in the investment segment amounting to RMB 85.65 million, a slight decrease of 2.0% from March 31, 2023[54]. - The company aims to optimize its investment asset structure and strengthen collaboration with project management parties to ensure stable long-term returns for shareholders[54]. Corporate Governance and Compliance - The independent auditor has provided an unqualified review opinion on the interim financial information for the six months ending September 30, 2023[149]. - The company has made efforts to ensure high-quality corporate governance in line with shareholder interests[149]. - The company has confirmed compliance with the standards for securities trading by directors during the review period[149]. - The latest version of the company's articles of association has been published on the company's website and the stock exchange[149].

Financial Performance - Revenue for the fiscal year ended March 31, 2023, was RMB 1,679 million, a decrease of 12.4% from RMB 1,916 million in the previous year[12]. - Operating profit for the same period was RMB 138 million, recovering from an operating loss of RMB 1,786 million in the previous year[12]. - Net profit attributable to the company's owners was RMB 115 million, compared to a net loss of RMB 1,783 million in the previous year[12]. - Gross margin for the year was 61.2%, down from 63.9% in the previous year[12]. - The company reported a net asset value per share of RMB 164.80, an increase from RMB 159.46 in the previous year[12]. - Total assets as of March 31, 2023, were RMB 10,577 million, slightly up from RMB 10,485 million in the previous year[12]. - The debt-to-equity ratio improved to 0.09 from 0.12 in the previous year, indicating a stronger financial position[12]. - The company reported a debt-to-equity ratio of 0.14 for the fiscal year 2022/23, indicating a stable financial position[53]. - The total revenue for the group was RMB 1,678,916 thousand, down 12.4% from RMB 1,915,735 thousand in the previous year[159]. - The gross profit for the group was RMB 1,063,544 thousand, compared to RMB 1,122,175 thousand in the previous year, indicating a decrease in gross profit margin[159]. - The operating profit for the group was RMB 137,848 thousand, a significant recovery from an operating loss of RMB 1,786,216 thousand in the previous year[159]. - The net profit from continuing operations was RMB 114,997 thousand, compared to a loss of RMB 1,765,704 thousand in the previous year, marking a turnaround in profitability[159]. - Total comprehensive income for the year was RMB 397,617 thousand, a significant recovery from a loss of RMB (1,893,956) thousand in the prior year[160]. - Basic and diluted earnings per share from continuing operations were RMB 1.96, a turnaround from a loss of RMB (30.11) per share in the previous year[160]. Market Strategy and Development - The company aims to enhance user confidence and promote a high-quality healthy lifestyle through its products[6]. - The group plans to continue focusing on digital transformation and omnichannel strategies to enhance operational efficiency and consumer engagement[32]. - The group aims to expand its market presence by seeking opportunities to operate more international brands in China and regional markets[39]. - The company is focusing on digital transformation and leveraging new technologies to optimize supply chain management and user experience[98]. - The group plans to continue expanding its market presence and product offerings, focusing on innovative designs and functional products to enhance customer experience[110]. - The company is optimistic about the growth potential of the sportswear market in China, driven by government initiatives and increasing industry penetration[110]. - The brand's strategy includes collaborations with trendy brands and digital marketing initiatives to attract younger consumers[76]. - The group aims to strengthen brand interaction with younger consumers through innovative marketing and co-branding initiatives[81]. Product Development and Innovation - The Kappa brand launched the Kappa 1916 product series during the reporting period, drawing design inspiration from its century-long history[32]. - The Kappa Player series was launched, integrating current fashion trends with the brand's historical elements, aimed at appealing to the youth market[57]. - The company emphasized the development of Kappa Sports products, incorporating advanced technologies such as K-FLEX and K-BREATH to enhance product quality and comfort[75]. - Kappa launched a new product line themed around the Chinese New Year, integrating Italian style with Eastern aesthetics, aimed at enhancing brand engagement with young consumers[102]. - Kappa's product lines include the Kappa 1916 series, Kappa Player series, and Kappa Sports series, which have been upgraded to meet modern consumer preferences[104][105]. - Kappa brand launched new products across design, materials, and functionality to strengthen market competitiveness[100]. Sustainability and Corporate Responsibility - The group is committed to sustainable development by incorporating recyclable and bio-based fibers into its product development[35]. - The group will continue to deepen its environmental, social, and governance (ESG) strategies to achieve long-term sustainable development[35]. - The company is committed to sustainable development and creating long-term value for shareholders[58]. - The group recognizes the importance of environmental, social, and governance (ESG) factors for sustainable development[86]. - The company maintained a focus on responsible supply chain management, emphasizing environmental protection and supplier evaluation[135]. - The group is committed to sustainable development, investing in eco-friendly materials and technologies to align with environmental and social governance (ESG) goals[112]. Challenges and Risks - The decline in sales was attributed to a decrease in customer traffic due to localized COVID-19 outbreaks and the transition of the children's clothing business to a licensing model[124]. - The group acknowledges various operational risks, including rising material costs and potential disruptions in supply chains, and has implemented strategies to mitigate these risks[115]. - In the 2022/23 fiscal year, the overall retail market was significantly impacted by the pandemic, leading to weak market demand and high fluctuations in raw material costs[100]. - The overall industry is experiencing structural changes, with brand differentiation and product innovation becoming key factors influencing consumer purchasing decisions[98]. Store and Asset Management - The total number of Kappa brand stores reached 1,025 as of March 31, 2023, a net decrease of 158 stores compared to the previous year[32]. - The investment division net assets amounted to RMB 8,741 million, an increase of 3.0% year-on-year as of March 31, 2023[36]. - The total number of Kappa brand retail stores reached 1,025, reflecting ongoing optimization and expansion of the self-operated store network[139]. - The group plans to optimize its investment asset structure and pursue new project investments cautiously[82].

Economic Performance - The Chinese economy showed a strong recovery with a GDP growth of 4.5% in Q1 2023 compared to the same period in 2022, indicating a rebound in consumer spending with retail sales increasing by 5.8% year-on-year[9]. - The group has reported a significant increase in offline customer traffic and consumption market recovery, driven by the government's optimization of pandemic control measures[14]. - The company anticipates future economic growth, projecting an increase in stock value that will provide stable returns to shareholders[73]. Business Strategy and Development - The group plans to leverage its management team's extensive experience in the sports apparel industry and strong financial resources to seek opportunities for operating more international brands in China and/or regional markets[5]. - The group is committed to optimizing its business system and accelerating digital transformation to improve efficiency and business performance[14]. - The group aims to provide long-term stable returns to shareholders through prudent project investment and timely exits from existing projects[3]. - The group aims to enhance brand competitiveness through innovative design and functional products, targeting the growing sportswear market in China[21]. - The group plans to continue expanding its market presence and product offerings, including collaborations with trendy brands like FR2[1]. Product Innovation and Marketing - The group continues to enhance its product development efforts, focusing on innovation in design, materials, and functionality to strengthen market competitiveness[14]. - The Kappa brand has engaged in multiple collaborations with youth idols and virtual influencers, enhancing brand visibility and engagement among younger consumers[14]. - The Kappa brand's promotional strategy emphasizes its core values of "passion, sexiness, and avant-garde," with various innovative and interactive marketing activities[14]. - The group has successfully launched new products under the phenix brand, including a collaboration with the Japanese streetwear brand FR2, showcasing a blend of retro elements and high-end technology[2]. - The group has launched the Kappa 1916 series to connect with younger consumers, emphasizing the brand's pioneering spirit and retro style[1]. Financial Performance - The group's operating profit for the reporting period was RMB 138 million, compared to an operating loss of RMB 1,786 million in the previous period, resulting in an operating profit margin of 8.2%[38]. - The group's sales cost for the reporting period was RMB 652 million, a decrease of RMB 39 million compared to RMB 691 million in the previous period[33]. - The total distribution and administrative expenses amounted to RMB 1,137 million, representing 67.7% of total sales, a reduction of 4.1 percentage points from the previous period[36]. - The group's advertising and sales expenses were RMB 788 million, a decrease of RMB 130 million from RMB 918 million in the previous period, mainly due to lower sales[58]. - The group's financial income net amount was RMB 40 million, compared to a net financial expense of RMB 14 million in the previous period[60]. Corporate Governance - The company adheres to the Hong Kong Stock Exchange listing rules, ensuring transparent communication with shareholders regarding business strategies and investment plans[75]. - The company emphasizes the protection of minority shareholders' rights and interests in its governance practices[75]. - The board of directors includes independent non-executive members, ensuring diverse perspectives in decision-making[85]. - The company has implemented a policy for the appointment of external auditors, ensuring their independence and the effectiveness of audit procedures[139]. - The company has established various committees, including the Audit Committee, Remuneration Committee, Nomination Committee, Executive Committee, and Environmental, Social, and Governance Committee, to oversee specific areas of the company's affairs[154]. Environmental, Social, and Governance (ESG) Commitment - The group is committed to sustainable development by establishing an Environmental, Social, and Governance (ESG) committee to oversee its policies[26]. - The company has maintained a commitment to environmental, social, and governance (ESG) reporting guidelines[95]. - The environmental, social, and governance (ESG) committee held two meetings in the past twelve months to review the company's ESG policies and performance[198]. - The company has complied with the environmental, social, and governance reporting guidelines as per the listing rules, with relevant disclosures made in its reports[144]. Workforce and Diversity - The group has reduced its workforce to 471 employees as of March 31, 2023, down from 627 employees a year earlier[28]. - The employee gender ratio is approximately 67.1% female and 32.9% male, reflecting the company's commitment to diversity[194]. - The board consists of 8 members, including 1 female and 6 males, with 3 independent directors and 4 executive directors[193]. - The company will continue to implement measures to promote diversity at all levels of the workforce[194]. - The nomination committee has reviewed the board's composition and is satisfied with its diversity in terms of independence, skills, industry experience, gender, age, and tenure[192].

Accounts Receivable Loans - As of March 31, 2022, the total accounts receivable loans amounted to RMB 867.5 million, including RMB 625.0 million to independent third parties and RMB 242.5 million to management personnel[2]. - The largest single borrower accounted for RMB 242.4 million, representing approximately 27.9% of the total accounts receivable loans[5]. - The total amount of loans to the five largest borrowers was RMB 576.8 million, accounting for approximately 66.5% of the total accounts receivable loans[5]. - The total number of borrowers under the lending arrangements was ten as of March 31, 2022[5]. Impairment and Repayment - The total provision for impairment of accounts receivable loans was approximately RMB 108.0 million, an increase of about 35.5% from RMB 79.7 million as of March 31, 2021[6]. - As of March 31, 2022, approximately 79.0% of the accrued interest had been repaid following the signing of a deferral agreement[8]. Credit Assessment and Loan Management - The company has adopted strict credit assessment policies and procedures to ensure the recoverability of loans and the adequacy of collateral[9]. - The company will continue to monitor the repayment ability of borrowers and the value of collateral to ensure the recovery of related loans[8]. - The company has established a committee to review and approve each loan application, ensuring compliance with listing rules[10]. Loan Characteristics - The company provided short-term loans with a typical duration of no more than one year, utilizing idle cash not required for business operations[4].

Financial Performance - For the six months ended September 30, 2022, the company reported revenue of RMB 776 million, a decrease of 8.9% compared to RMB 852 million in the same period last year[12]. - Gross profit for the same period was RMB 484 million, down 12.3% from RMB 552 million year-on-year[12]. - The company recorded a loss attributable to equity holders of RMB 386 million, which is a 48.4% reduction from a loss of RMB 748 million in the previous year[12]. - Basic loss per share was RMB 6.59, reflecting a 48.4% improvement compared to RMB 12.76 in the prior year[12]. - The gross margin decreased to 62.4%, down 2.4 percentage points from 64.8% in the previous year[12]. - The operating loss improved significantly to RMB 392 million, a 49.1% reduction from RMB 770 million in the previous year[12]. - The Kappa brand's total sales during the reporting period amounted to RMB 684 million, down from RMB 747 million in the previous year, representing a decline of RMB 63 million[58]. - The group's gross profit for the reporting period was RMB 461 million, a decrease of RMB 97 million from RMB 558 million in the previous year, resulting in a gross margin of 59.4%, down 6.1 percentage points from 65.5%[62]. - The company reported a net loss of RMB 386,227 thousand for the period, compared to a net loss of RMB 747,949 thousand in the same period last year, indicating an improvement[167]. - The company’s total comprehensive income for the period was RMB 17,415 thousand, a significant recovery from a loss of RMB 812,443 thousand in the previous year[154]. Store Operations - As of September 30, 2022, the total number of Kappa brand stores was 1,099, a net decrease of 84 stores since March 2022[17]. - The number of Kappa brand self-operated stores reached 640, while the total number of Kappa brand stores was 1,099[58]. - The total number of Kappa brand stores reached 1,099 as of September 30, 2022, a net decrease of 84 stores compared to March 31, 2022[42]. Marketing and Brand Strategy - The company aims to enhance its digital marketing strategies and has collaborated with young idols and artists to engage with consumers in both real and virtual worlds[17]. - Kappa brand launched the "Endless Spirit" marketing theme and introduced the new Kappa Player series, targeting Gen Z consumers[18]. - Kappa's marketing strategy focused on engaging with Generation Z through collaborations with popular artists, resulting in over 100 million exposures across platforms for their summer theme song and MV[35]. - Kappa's promotional efforts included collaborations with youth idols and leveraging social media trends to strengthen brand engagement with younger consumers[35]. - The brand's focus on creating a warm and deep connection with consumers aims to encourage a positive attitude towards challenges posed by the pandemic[32]. - Kappa's marketing activities are aligned with the interests of Generation Z, utilizing social media and virtual collaborations to enhance brand visibility[35]. - Kappa brand launched a collaboration with British creative organization BRANDALISED® and Brazilian pop artist Romero Britto, introducing a street culture message to the youth[32]. Investment and Financial Strategy - The group's investment division net assets reached RMB 8,568 million as of September 30, 2022, a 0.9% increase from March 31, 2022[22]. - The group will maintain a prudent investment strategy to provide stable and sustainable returns to shareholders[22]. - The investment strategy remains cautious, with a focus on equity investments, stock investments, fixed income, and cash management to ensure investment safety[45]. - The group plans to continue optimizing its investment asset structure and manage new project investments prudently to provide stable returns to shareholders[52]. - The company has not adopted any new or revised standards that would have a significant impact on its financial statements for the current or future reporting periods[179]. Cash Flow and Liquidity - As of September 30, 2022, the group's cash and bank balance was RMB 2,613 million, an increase of RMB 1,061 million from RMB 1,552 million as of March 31, 2022[84]. - The company reported a net cash inflow from operating activities of approximately RMB 22 million[84]. - The cash flow from operating activities for the six months ended September 30, 2022, was RMB 22,287 thousand, a significant recovery from a cash outflow of RMB 172,386 thousand in the previous year[171]. - The company’s cash and cash equivalents at the end of the period were RMB 2,602,990 thousand, up from RMB 1,377,643 thousand at the end of the previous year[171]. Corporate Governance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange regulations during the review period[143]. - The audit committee, consisting of three independent non-executive directors, reviewed the interim financial information for the six months ending September 30, 2022[147]. - The company is committed to implementing high-quality corporate governance practices to align with shareholder interests[139]. Risk Management - Credit risk primarily arises from receivables and trade receivables from subsidiaries engaged in investment and operational activities[185]. - The company has maintained its risk management policies since March 31, 2022, with no significant changes reported[184]. - The company’s financial risk management includes market risk, credit risk, and liquidity risk, which are detailed in the annual financial statements[183].

Financial Performance - For the fiscal year 2021/2022, the company reported a revenue of RMB 1,916 million, a decrease of 2.7% compared to RMB 1,970 million in the previous year[25]. - The operating loss for the year was RMB 1,751 million, compared to an operating profit of RMB 2,070 million in the prior year[25]. - The gross profit margin decreased to 63.9% from 65.6% year-on-year[25]. - The net loss attributable to shareholders was RMB 1,747 million, compared to a profit of RMB 1,811 million in the previous year[25]. - Basic and diluted loss per share was RMB 29.79, down from earnings of RMB 30.88 per share in the previous year[25]. - The group recorded revenue of RMB 1,916 million for the fiscal year ending March 31, 2022, a decrease of 2.7% year-on-year[40]. - The net loss attributable to equity holders was RMB 1,747 million during the reporting period[40]. - The group's gross profit was RMB 1,225 million, a decrease of RMB 67 million from RMB 1,292 million in the previous period, with a gross margin of 63.9% (previous period: 65.6%)[111]. - The group reported a loss attributable to owners of RMB 1,747 million for the reporting period, compared to a profit of RMB 1,811 million in the previous year[99]. Assets and Liabilities - Total assets as of March 31, 2022, were RMB 10,485 million, a decrease from RMB 12,638 million in the previous year[27]. - The company's net current assets amounted to RMB 4,484 million, down from RMB 5,764 million in the previous year[27]. - The debt-to-equity ratio increased to 0.12 from 0.10 year-on-year[28]. - The group had a net asset value attributable to equity holders of RMB 9,351 million as of March 31, 2022, down from RMB 11,533 million as of March 31, 2021[1]. - The group's current ratio as of March 31, 2022, was 6.7 times, down from 9.0 times as of March 31, 2021[1]. Market and Industry Trends - In 2021, the sportswear industry in China reached a market size of 385.8 billion yuan, with expectations to exceed 400 billion yuan in 2022[65]. - The national sports industry is projected to reach a total scale of 5 trillion yuan by 2025, with a target of 38.5% of the population regularly participating in sports[65]. - Online retail sales of physical goods grew by 12.0% in 2021, accounting for 24.5% of total retail sales, which exceeded 40 trillion yuan, reflecting a 12.5% year-on-year increase[54]. - The sportswear industry is focusing on digital transformation and expanding online channels, with increasing revenue from platforms like Xiaohongshu and Douyin[65]. Strategic Initiatives - The company aims to become the most desirable sports lifestyle brand, focusing on talent and management excellence[7]. - Future strategies include market expansion and potential new product development to enhance brand presence[39]. - The group aims to deepen digital transformation and enhance omnichannel operations to capture opportunities in the sports industry[44]. - The group plans to focus on the rapidly growing snow sports industry, investing in Xinjiang to create a comprehensive system around skiing equipment and training[43]. - The group will continue to integrate online and offline channels to optimize sales strategies and expand customer reach[40]. - The group is actively collaborating with local designers and brands to launch co-branded products, enhancing brand image[40]. - The group is committed to providing high-quality products and services in the Chinese market, maintaining its long-term commitment[40]. Corporate Governance and Management - The company has adhered to the corporate governance code as per the Hong Kong Stock Exchange rules, with the exception of the chairman's absence at the annual general meeting due to important matters[176]. - The board consists of seven members, including four executive directors and three independent non-executive directors, ensuring a balanced composition with sufficient knowledge and experience[182]. - The company has established an Environmental, Social, and Governance (ESG) committee to oversee its commitment to sustainability[88]. - The company has implemented environmental, social, and governance (ESG) reporting guidelines, disclosing relevant information in its ESG report[178]. - The executive committee is authorized by the board to manage the company's daily operations, focusing on overall strategy, financial matters, and risk management[179]. Marketing and Brand Development - Kappa brand successfully held its first annual fashion show in China in May 2021, marking a significant milestone in its 20-year market presence[70]. - Kappa has sponsored multiple national teams and sports events, achieving high visibility and brand recognition, with Kappa apparel worn by many athletes during competitions[73]. - Kappa's marketing strategy during the Lunar New Year included a campaign featuring Olympic champion Sun Yiwen, enhancing brand visibility through social media[70]. - The group has seen challenges in the operating environment due to the COVID-19 pandemic and a warm winter, impacting product demand[68]. - Kappa's brand promotion efforts have significantly increased brand awareness and image through various marketing combinations during major sports events[68]. Operational Efficiency - The group aims to strengthen its market position by optimizing online and offline sales channels and enhancing overall operational efficiency[68]. - The group aims to enhance operational efficiency by closing underperforming stores while expanding its e-commerce presence[80]. - The company is optimizing its offline store operations and enhancing digital management for better efficiency[65]. - The group has expanded its online store count to 764, facilitating flexible inventory management[78]. Future Outlook - The management has provided guidance for the next fiscal year, projecting a revenue growth of 10% to 12%[166]. - The company maintains an optimistic outlook on the sports apparel industry, anticipating growth opportunities as the pandemic situation improves[80]. - The company plans to expand its market presence in Southeast Asia, targeting a 30% increase in market share over the next two years[161].

Financial Performance - For the six months ended September 30, 2021, the company recorded revenue of RMB 852 million, an increase of 4.5% year-on-year[13]. - The gross profit was RMB 552 million, down 2.6% from RMB 567 million in the previous year, with a gross margin of 64.8%, a decrease of 4.8 percentage points[13]. - The company reported a net loss attributable to shareholders of RMB 748 million, compared to a profit of RMB 1,116 million in the same period last year, representing a decline of 167.0%[13]. - Basic loss per share was RMB 12.76, compared to earnings of RMB 19.04 per share in the previous year[13]. - The total sales revenue for the Kappa brand during the reporting period was RMB 747 million, a slight decrease of RMB 1 million compared to RMB 748 million in the previous period[50]. - The overall sales revenue for the group increased by 4.5% to RMB 852 million from RMB 815 million in the previous period[47]. - The gross profit for the group was RMB 558 million, up RMB 21 million from RMB 537 million in the previous period, resulting in a gross margin of 65.5%[53]. - The company incurred a loss from operations of RMB 769,769,000, compared to a profit of RMB 1,281,925,000 in the previous year, reflecting a significant decline[117]. - The total comprehensive loss for the period amounted to RMB 812,443,000, compared to a comprehensive income of RMB 913,720,000 in the previous year[119]. Store Expansion and Brand Strategy - The company opened 46 new Kappa brand stores, bringing the total to 1,421 stores as of September 30, 2021[17]. - Kappa has established a new brand core strategy of "returning to sports," actively sponsoring various sports teams, including the official sponsorship of the Chinese national skateboarding, equestrian, and fencing teams for the Tokyo Olympics[18]. - Kappa's first brand concept store opened in Beijing's Sanlitun, aiming to provide a high-end, customized shopping experience[33]. - Kappa has launched new product lines, including the Kappa x Jianyi Street co-branded skateboard shoes, and held offline events to enhance brand visibility[25]. - Kappa's collaboration with Olympic gold medalist Sun Yiman as a brand ambassador highlights the brand's commitment to promoting sports in China[33]. Market and Consumer Trends - The retail sales of consumer goods in China increased by 13.9% year-on-year in the first half of 2021, with online physical goods retail sales reaching approximately RMB 6.1 trillion, a year-on-year growth of 23.2%[28]. - The market size of China's sports footwear and apparel industry reached RMB 385.8 billion in 2021, with a compound annual growth rate (CAGR) of 9.83% from 2021 to 2023, ranking second among consumer sub-industries[30]. - The penetration rate of sports apparel consumption in China is only 12.5% of total footwear and apparel consumption, indicating significant growth potential[30]. - The Chinese sports footwear market is experiencing faster growth than the overall footwear market, driven by increasing health awareness and consumer demand for sports products[30]. Investment and Financial Strategy - The group reported an investment loss of RMB 661 million during the period, compared to an investment income of RMB 1,243 million previously, with net assets in the investment division decreasing by 9.8% to RMB 9,488 million as of September 30, 2021[22]. - The group aims to optimize its investment asset structure and strengthen cooperation with project management parties to ensure prudent investment in new projects[22]. - The company is committed to innovation and seizing opportunities in the sports industry, aiming to provide stable returns to shareholders despite uncertainties[23]. - The company has adjusted its investment strategy to optimize asset structure and ensure long-term stable returns for shareholders[42]. - The company has a capital commitment of RMB 300 million related to various investment agreements as of September 30, 2021[86]. Operational Challenges - The company faced challenges due to a resurgence of COVID-19 and adverse weather conditions, which impacted revenue in August and September 2021[15]. - The overall sales cost has increased due to rising raw material prices, with cotton prices reaching an annual high in September, impacting the retail performance of the apparel industry[28]. - The company experienced a fair value adjustment loss on investments due to macro market fluctuations since March 2021[15]. - The company reported a significant increase in inventory impairment losses, totaling RMB 5,893,000 compared to a reversal of RMB 30,738,000 in the previous year[117]. Digital and Omnichannel Strategies - Kappa is focusing on digital and omnichannel marketing strategies, enhancing private domain channels and launching new marketing scenarios to drive sales conversion[21]. - The company continues to deepen its sales layout in emerging channels like Douyin and Dewu to enhance online brand marketing and increase total sales[21]. - The company is leveraging digital technology to enhance the circulation and sales processes of its products, integrating online and offline sales channels[30]. - The company continues to focus on digitalization and omnichannel strategies to enhance brand competitiveness and operational efficiency[42]. Corporate Governance and Compliance - The company has committed to maintaining high standards of corporate governance and compliance with the Hong Kong Stock Exchange's listing rules[114]. - The company reported financial data for the six months ending September 30, 2021, which is unaudited[144]. - The company’s accounting policies remain consistent with those used in the annual financial statements for the year ending March 31, 2021[147].

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Ak | --- | --- | |-----------------------------------------------------------------------|-------| | | | | | Ak | | | | | Ar Kappa | Ab | | | Ak | | 2020/2021 | AA | | | Ak | | 中 期 觀 篇 | Ab | | | r | | | Ab | | | AK | | | | | | Ak | | | Ak | | | | | | Ak | | | Ab | | | Ab | | | Ak | | | Ak | | | Ak | | | AA | | DONG ANG | Ak | | China Dongxiang (Group) Co., Ltd. 中 國 動 向 ( 集 團 ) 有 限 公 司 | AA | | (於開曼群島註因成立的有限公司） 股份代號: 3818 | Ak | | | Ab | Kappa 目錄 公司資料 2 投資者資訊 4 業績摘要 5 主席報告書 6 8 管理層討論及分析 其他資料 26 中期簡明綜合財務資料 ...

Financial Performance - Sales revenue for the fiscal year ending March 31, 2020, was RMB 1,841 million, an increase from RMB 1,635 million in the previous year[22] - Operating profit decreased to RMB 484 million from RMB 584 million year-on-year[22] - Profit attributable to equity holders was RMB 366 million, down from RMB 429 million in the previous year[22] - Gross profit margin improved to 61.8% from 55.9% year-on-year[22] - Net profit margin decreased to 19.9% from 26.3% year-on-year[22] - Basic earnings per share decreased to RMB 6.25 from RMB 7.34 year-on-year[22] - The group recorded revenue of RMB 1,841 million, an increase of 12.6% year-on-year, while profit attributable to equity holders decreased by 14.7% to RMB 366 million[35] - Basic earnings per share decreased by 14.9% to RMB 6.25, with a total dividend payout ratio of 45% for the year[35] Assets and Liabilities - Total assets as of March 31, 2020, were RMB 11,689 million, slightly up from RMB 11,650 million the previous year[23] - Current assets increased to RMB 6,735 million from RMB 4,475 million year-on-year[23] - The debt-to-equity ratio improved to 0.10 from 0.14 year-on-year[24] - The group's net asset value attributable to equity holders was RMB 10,612 million as of March 31, 2020, compared to RMB 10,251 million as of March 31, 2019[1] - The group's cash and bank balances amounted to RMB 2,101 million, an increase from RMB 1,157 million as of March 31, 2019[1] Market and Economic Conditions - The global economic slowdown led to a 6.1% GDP growth in China for 2019, but the first quarter of 2020 saw a significant decline of 6.8% due to the pandemic[49][50] - The retail sales of consumer goods in China for 2019 reached RMB 4,116.49 billion, with a nominal growth of 8.0% year-on-year[51] - In response to the pandemic, the Chinese government implemented various policies to boost domestic demand and consumer spending, aiming to recover the economy[59] - The pandemic has intensified the public's awareness of fitness and health, positively impacting the sports goods industry[59] - The sports industry in China is expected to become a pillar of the national economy, with increasing contributions and development opportunities, especially with the upcoming Winter Olympics[59] Brand and Product Development - The company aims to become the most desirable sports lifestyle brand[10] - The total number of Kappa brand stores was 1,372, a net decrease of 132 stores compared to the previous year, with plans to continue closing inefficient stores[38] - The children's clothing business generated revenue of RMB 88 million, accounting for 4.8% of the group's total revenue[38] - Kappa brand achieved significant progress despite the challenges posed by COVID-19, through deep reforms in channel, product, and supply chain management[60] - Kappa's brand promotion in Japan targets heavy skiers aged 25 to 45, enhancing brand value through various marketing channels[68] - Kappa's shoe segment has undergone significant transformation, with the new KOLUMN vulcanized shoe series driving sales and showing notable increases compared to the same period last year[76] E-commerce and Sales Channels - E-commerce business maintained continuous growth, leveraging online big data for sustainable sales network development[38] - The sales distribution for the Kappa brand was 43.3% from non-self-operated channels and 56.7% from self-operated channels, compared to 34.2% and 65.8% respectively in the previous year[101] - Self-operated channel sales for the Kappa brand in China amounted to RMB 787 million, up RMB 52 million from RMB 735 million in the previous period, representing 56.7% of Kappa's sales in China (previous period: 65.8%) [102] Corporate Social Responsibility - The group has committed RMB 600,000 in donations to support frontline medical workers during the COVID-19 pandemic[38] - The company actively engages in community activities and social donations to fulfill its corporate social responsibility[177] - The company emphasizes the importance of talent and has established a comprehensive compensation and training system to provide a good promotion platform for employees[146] Investment Strategy - The investment division's net assets reached RMB 9,245 million, a 4.1% increase from the previous year, with net investment income of RMB 567 million during the reporting period[41] - The company plans to continue investing prudently while ensuring investment safety and providing stable returns to shareholders amid market uncertainties[134] - The investment portfolio's valuation has steadily increased under a prudent approach, ensuring safety and reasonable returns for shareholders[82] Governance and Compliance - The company prioritizes compliance with laws and regulations, ensuring a transparent corporate governance structure[168] - The company promotes a culture of integrity and fairness, implementing anti-corruption measures and ensuring compliance in operations[164] - The company has established a transparent and standardized supplier bidding process to eliminate corruption in the bidding department[193] Employee Welfare and Development - The company has implemented a comprehensive occupational health and safety management system, ensuring all factory workers are equipped with protective gear[198] - The company conducted annual health check-ups for employees and organized health seminars to promote health awareness[198] - A series of training systems were established, including management and new employee training, to enhance talent development[200]