Financial Performance - Revenue for the Reporting Period was approximately HK$357.8 million, an increase from HK$258.4 million in the same period last year, representing a growth of 38.5%[16] - Loss after taxation for the Reporting Period amounted to approximately HK$8.7 million, a decrease from a loss of HK$20.4 million in the previous year, indicating an improvement of 57.5%[16][21] - Basic loss per share for the Reporting Period was approximately 1.05 HK cents, based on a weighted average of 500,000,000 ordinary shares[16] - Gross profit for the Reporting Period was approximately HK$48.8 million, compared to HK$45.3 million in the previous year, reflecting a gross margin increase[21] - Other income for the Reporting Period was approximately HK$15.2 million, a significant increase from a loss of HK$1.9 million in the previous year[21] - Loss before taxation improved to approximately HK$8.2 million from HK$18.3 million in the previous year, showing a reduction of 55.2%[21] - Income tax expense for the Reporting Period was approximately HK$0.5 million, down from HK$2.1 million in the previous year[21] - For the six months ended September 30, 2023, the loss attributable to owners of the Company was HK$5,235,000, a significant improvement from a loss of HK$18,923,000 in the same period of 2022, representing a reduction of approximately 72.5%[23] - Total comprehensive expense for the period was HK$9,579,000, down from HK$21,253,000 in the prior year, indicating a decrease of about 55.1%[23] - Basic loss per share for the period attributable to owners of the Company improved to HK$0.09 from HK$1.05, reflecting a substantial decrease in loss per share of approximately 91.4%[23] Assets and Liabilities - Non-current assets increased to HK$120,958,000 as of September 30, 2023, compared to HK$10,762,000 as of March 31, 2023, showing a significant rise[25] - Current assets rose to HK$253,947,000 from HK$216,732,000, marking an increase of approximately 17.2%[25] - Current liabilities increased to HK$189,711,000 from HK$115,184,000, representing a rise of about 64.6%[25] - Net assets as of September 30, 2023, were HK$118,378,000, up from HK$91,644,000 as of March 31, 2023, indicating an increase of approximately 29.1%[27] - The Company reported an increase in inventories to HK$26,954,000 from HK$16,871,000, which is an increase of about 59.5%[25] - The amount due to a related party rose to HK$75,026,000 from HK$70,585,000, reflecting an increase of approximately 6.5%[25] - Trade debtors, net of loss allowance, increased to HK$66,426,000 as of 30 September 2023, up from HK$34,593,000 as of 31 March 2023, reflecting a 92.1% increase[95] - Trade payables rose to HK$64,473,000 as of 30 September 2023, compared to HK$22,406,000 as of 31 March 2023, marking a 187.5% increase[102] - As of 30 September 2023, the Group's total trade and other receivables amounted to HK$85,856,000, an increase from HK$58,220,000 as of 31 March 2023, representing a 47.5% growth[95] Cash Flow and Financing - The company generated HK$5,730,000 in cash from operations before working capital changes, a significant turnaround from cash used in operations of HK$19,416,000 in the previous year[35] - Net cash generated from operating activities was HK$5,233,000, compared to cash used of HK$20,215,000 in the same period last year[35] - The company reported a net increase in cash and cash equivalents of HK$1,553,000, contrasting with a decrease of HK$41,773,000 in the prior year[36] - The company invested HK$1,892,000 in property, plant, and equipment, compared to HK$76,000 in the same period of 2022[36] - Proceeds from bank borrowings amounted to HK$13,843,000, while repayments totaled HK$6,317,000, indicating active financing activities[36] - The company’s interest income increased to HK$760,000 from HK$31,000 in the previous year, reflecting improved financial management[36] Segment Performance - The Garment Business generated segment revenue of HK$274,964,000, while the Healthcare Products Business and IRO with CRO and In-house R&D Business contributed HK$65,060,000 and HK$17,805,000, respectively[52] - The Group reported a segment loss of HK$17,218,000 for the six months ended September 30, 2023, compared to a loss of HK$8,884,000 for the same period in 2022[52][55] - Revenue from external customers for the six months ended September 30, 2023, included HK$120,467,000 from the United States and HK$106,979,000 from Japan[63] - The Healthcare Products Business experienced a segment loss of HK$369,000, while the IRO with CRO and In-house R&D Business reported a significant loss of HK$26,661,000[52] - The Group recorded revenue of approximately HK$17.8 million for the Reporting Period in the specialized CRO business, representing an increase of approximately 141.3% compared to HK$7.4 million for the six months ended 30 September 2022[150] Expenses - Selling and distribution expenses increased to HK$25.5 million from HK$21.5 million, indicating a rise of 18.6%[21] - Administrative expenses were slightly higher at HK$32.1 million compared to HK$31.6 million in the previous year[21] - Research and development expenses for the six months ended 30 September 2023 amounted to HK$11,408,000, an increase from HK$5,412,000 in the previous year, reflecting a growth of approximately 110.5%[80] - Staff costs, including directors' remuneration, rose to HK$43,003,000 for the six months ended 30 September 2023, compared to HK$25,517,000 in the previous year, marking an increase of approximately 68.2%[80] - Selling and distribution expenses increased by approximately HK$4.0 million or 18.2% to approximately HK$25.5 million, primarily due to rising transportation costs[186] - Administrative expenses rose by approximately HK$0.5 million or 1.6% to approximately HK$32.1 million, mainly due to increased staff costs and legal fees[191] Dividends - The Board does not recommend the payment of an interim dividend for the Reporting Period[16] - No dividends were paid, declared, or proposed during both interim periods, with the Board not recommending any payment of interim dividend for the current interim period[75] Acquisitions and Investments - The company acquired 65% of R&E Corporation Limited for HK$56.16 million, completed on May 23, 2023[108] - The identifiable net assets acquired amounted to HK$15.76 million, with goodwill arising from the acquisition at HK$19.92 million[111] - The acquisition of R&E Corporation Limited is part of the company's strategy to expand into the Japanese health food market[108] - The Limited Partnership established in Japan aims to invest in start-ups and emerging companies with high growth potential in healthcare, intelligent manufacturing, technology, and consumer services[93] Strategic Focus - The Group is focusing on anti-obesity and anti-diabetes therapies using brown adipocytes induction technology, and is collaborating with a major university in Japan on a treatment for Lower Extremity Artery Diseases (LEAD)[149] - The Group aims to provide a one-stop solution for drug development support, leveraging its knowledge and experience in the IRO and CRO services[142] - The IRO business is expected to create synergies for the expansion of the In-House R&D and Healthcare Products Business segments[147] - The Group's sales teams are actively expanding client bases and exploring new manufacturing sources and product development to maintain profitable margins in the Garment Business[134] - Economic challenges such as rising interest rates and inflation continue to impact the Group's business operations[134]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部分內容而 產生或因倚賴該等內容而引致之任何損失承擔任何責任。 （於開曼群島註冊成立之有限公司） （股份代號：3860） 截至二零二三年九月三十日止六個月 之中期業績公告 財務摘要 － 報告期內錄得收益約357.8百萬港元； － 期內之除稅後虧損為約8.7百萬港元； － 根據本公司500,000,000股本公司普通股加權平均數計算，期內之每股基本虧損為 約1.05港仙；及 － 董事會並不建議派付報告期內之中期股息。 ...

Revenue and Profit Performance - The apparel segment recorded revenue of approximately HKD 381.5 million, a decrease of about 10.2% compared to HKD 424.6 million for the year ended March 31, 2022[11]. - The gross profit for the apparel segment was approximately HKD 61.8 million, slightly down from HKD 62.5 million for the previous year[11]. - The healthcare products segment generated revenue of approximately HKD 55.8 million, a decrease of about 29.8% from HKD 79.5 million in the previous year[23]. - The gross profit for the healthcare products segment was approximately HKD 12.2 million, down from HKD 18.2 million, attributed to decreased procurement orders from a major client in Japan and the depreciation of the yen[23]. - The internal R&D segment recorded revenue of approximately HKD 15.6 million, a slight decrease of about 1.3% from HKD 15.8 million in the previous year[29]. - The total revenue decreased from approximately HKD 424.6 million to HKD 381.5 million, a reduction of about HKD 43.1 million, primarily due to a significant decrease in procurement orders from a major client based in Japan[34]. - Women's apparel revenue decreased from approximately HKD 323.6 million to HKD 298.8 million, a decline of about HKD 24.8 million (7.7%) due to a drop in sales volume from approximately 4.1 million units to 3.3 million units, despite an increase in average selling price from HKD 78.3 to HKD 89.3[42]. - Men's apparel revenue increased from approximately HKD 61.9 million to HKD 69 million, an increase of about HKD 7.1 million (11.5%), primarily due to an increase in average selling price from HKD 64.2 to HKD 71.2[42]. - Children's apparel revenue significantly decreased from approximately HKD 39.1 million to HKD 13.7 million, a decline of about HKD 25.5 million (65.1%), attributed to a drop in sales volume from approximately 0.7 million units to 0.3 million units and a decrease in average selling price from HKD 58.1 to HKD 51.8[43]. - Revenue from health products decreased from approximately HKD 79.5 million to HKD 55.8 million, a decline of about HKD 23.7 million (29.8%), mainly due to reduced procurement orders from major Japanese clients[44]. Acquisitions and Business Expansion - The company is focusing on enhancing its healthcare product business and innovation research organization (IRO) through acquisitions during the reporting period[5]. - The company has acquired three Chinese companies engaged in clinical trial services and one company in Japan for procurement and distribution of healthcare products[19]. - The company completed the acquisition of 100% of EP Trading Limited in December 2022, enhancing its distribution capabilities for healthcare products[23]. - The group completed the acquisition of three Chinese equity companies for a total consideration of approximately RMB 2.85 million (approximately HKD 3.24 million) on September 20, 2022[78]. - The acquisition of EP Trading Co., Ltd. was completed for a total consideration of approximately JPY 99.4 million (approximately HKD 5.6 million) on December 7, 2022[79]. - The group acquired 65% of R&E Corporation Limited for a total consideration of approximately HKD 56.16 million, completed on May 23, 2023[83]. - The IRO business is expected to provide synergies for the expansion of internal R&D and healthcare products[27]. - The company expects to leverage its acquisitions for future growth and market expansion strategies[140]. Financial Position and Liabilities - The total comprehensive expenses attributable to the company's owners increased to approximately HKD 45.4 million, up from HKD 20.6 million, mainly due to increased research and administrative expenses related to new drug development[33]. - As of March 31, 2023, the group's current assets amounted to approximately HKD 101.5 million, a decrease of about 23.9% compared to HKD 202.4 million on March 31, 2022[68]. - The current ratio declined from approximately 3.5 on March 31, 2022, to about 1.9 on March 31, 2023, primarily due to a significant increase in current liabilities by approximately 40%[68]. - The group's debt-to-equity ratio increased from 1.12 on March 31, 2022, to 1.48 on March 31, 2023, reflecting the total loans and borrowings[68]. - The total liabilities as of March 31, 2023, were 82,288 thousand HKD, with trade and other payables amounting to 36,451 thousand HKD[143]. - Current liabilities increased to HKD 115,184 thousand from HKD 82,288 thousand, marking an increase of approximately 40.1%[126]. - The company’s total equity as of March 31, 2023, was HKD 91,644 thousand, compared to HKD 139,864 thousand, indicating a decrease of about 34.5%[128]. - The company’s retained earnings showed a cumulative loss of HKD 27,015 thousand as of March 31, 2023, compared to a loss of HKD 34 thousand in the previous year[128]. Employee and Operational Insights - The total employee costs for the year ended March 31, 2023, were approximately HKD 55.1 million, compared to HKD 38.8 million for the previous year, indicating a significant increase in personnel expenses[92]. - As of March 31, 2023, the group employed a total of 112 employees, with 111 being full-time and 1 part-time[199]. - The group adheres to local labor laws for employee annual leave and benefits, ensuring fair compensation based on individual performance[196]. - The group emphasizes a transparent and fair recruitment system, providing equal opportunities and a discrimination-free workplace[195]. - The management compensation is linked to the group's operational performance, incentivizing management based on the company's success[196]. - The group is committed to eliminating workplace bias and discrimination based on gender, marital status, disability, and family status[195]. - The employee distribution by gender shows 88 males and 24 females, indicating a male-dominated workforce[199]. - The group has implemented effective measures to protect employee rights and ensure compliance with anti-discrimination laws[195]. Future Outlook and Strategic Initiatives - The company maintains a cautiously optimistic outlook, investing in product design and development, including healthcare apparel products[12]. - The company aims to create a business co-creation platform to meet the diverse needs of the healthcare industry between China and Japan[12]. - The group is cautiously optimistic about the future, planning to invest in product design and development, including health apparel, to promote a healthy lifestyle[98]. - The group plans to simplify its organizational structure and operational processes to save costs and enhance competitiveness[98]. - The group will continue to explore opportunities for business diversification while considering market uncertainties[110]. - The growth of the apparel supply chain management services is expected to be driven by increased disposable income and economic recovery globally[98]. Environmental and Social Responsibility - The group aims to reduce the negative environmental impact of daily operations through energy-saving and resource recycling methods, complying with all relevant environmental laws and regulations as of March 31, 2023[94]. - The company has recognized potential financial losses due to extreme weather events, which may lead to increased operational costs and delayed deliveries[186]. - The company has implemented various measures to prevent and mitigate the negative impacts of extreme weather[187]. - The company aims to support harmonious social development and establish mutually beneficial relationships with stakeholders[194]. - The group is dedicated to sustainable development while achieving economic goals, reflecting its social responsibility[195].

香港交易及結算所有限公司以及香港聯合交易所有限公司對本公告的內容概不負責，對 其準確性或完整性亦不發表任何聲明，並明確表示，概不會就因本公告全部或任何部分 內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 （於開曼群島註冊成立之有限公司） （港交所股份代號：3860） 截至二零二三年三月三十一日止年度之 全年業績公告 財務摘要 截至二零二三年三月三十一日止年度，本集團營運業績如下： － 截至二零二三年三月三十一日止年度錄得收益約452.9百萬港元； － 截至二零二三年三月三十一日止年度之除稅後虧損約為50.3百萬港元； － 根據500,000,000股普通股加權平均數計算，截至二零二三年三月三十一日止年度 之每股基本虧損約為9.15港仙；及 － 董事並不建議派付截至二零二三年三月三十一日止年度之末期股息。 ...

Financial Performance - The company recorded revenue of approximately HKD 228.0 million for the reporting period[6] - The after-tax loss for the period was approximately HKD 8.4 million[6] - The basic loss per share for the period was approximately HKD 1.7 cents, based on a weighted average of 500,000,000 ordinary shares[6] - The gross profit for the period was HKD 43.0 million, compared to HKD 30.6 million in the previous year[9] - Total comprehensive loss for the period was HKD 7.6 million, compared to HKD 5.5 million in the previous year[11] - The company reported a net loss of HKD 7,842,000 for the six months ended September 30, 2022, compared to a net loss of HKD 5,425,000 for the same period in 2021, indicating an increase in losses of approximately 44%[20] - The group recorded revenue of approximately HKD 225.3 million for the six months ended September 30, 2022, a decrease of about 8.3% from HKD 245.8 million for the same period in 2021[89] - The group reported a loss before tax of HKD 6,056 thousand for the six months ended September 30, 2022, compared to a loss of HKD 4,447 thousand for the same period in 2021[36] - The group experienced a total comprehensive loss attributable to owners of approximately HKD 7.2 million, compared to a loss of HKD 5.3 million in the same period last year[93] Assets and Liabilities - The company's total assets less current liabilities were HKD 172.3 million, down from HKD 201.1 million as of March 31, 2022[14] - The company's cash and cash equivalents were HKD 162.99 million, a decrease from HKD 197.95 million as of March 31, 2022[14] - The company's net assets stood at HKD 118.73 million, down from HKD 126.70 million as of March 31, 2022[16] - Total equity as of September 30, 2022, was HKD 118,734,000, a decrease from HKD 129,679,000 as of March 31, 2022, reflecting a decline of about 8.7%[20] - The total liabilities increased to HKD 56,952,000 as of September 30, 2022, compared to HKD 22,673,000 as of March 31, 2022, indicating a significant rise in obligations[75] - The company's net current assets as of September 30, 2022, were approximately HKD 160.9 million, down from HKD 190.0 million as of March 31, 2022, with a current ratio decreasing from about 5.0 to 2.9[125] Revenue Segmentation - The company's total revenue sources are categorized into apparel and healthcare segments, with further details provided in the financial notes[31] - The apparel segment generated revenue of HKD 225,321 thousand, while the healthcare segment contributed HKD 2,643 thousand for the six months ended September 30, 2022[36] - Revenue from women's apparel increased by approximately HKD 16.7 million or 10.6%, reaching about HKD 175 million, driven by an increase in average selling price from HKD 72.1 to HKD 90.9[101] - The group’s revenue from women's products accounted for approximately 77.6% of total revenue, up from 64.4% in the previous period[94] - Men's apparel revenue decreased from approximately HKD 52.1 million to about HKD 39.7 million, a reduction of approximately HKD 12.4 million or 23.8% due to a drop in sales volume from about 840,000 units to approximately 554,000 units[102] - Children's apparel revenue fell from approximately HKD 35.5 million to about HKD 10.7 million, a decrease of approximately HKD 24.8 million or 69.9%, with sales volume dropping from about 605,000 units to approximately 203,000 units[104] Expenses and Costs - Research and development expenses for new drug development amounted to HKD 2.6 million, a decrease from HKD 5.4 million in the previous year[9] - Employee costs increased significantly to HKD 17,637,000 in 2022 from HKD 12,789,000 in 2021, marking a 38% rise[60] - The total employee costs for the six months ended September 30, 2022, amounted to approximately HKD 17.6 million, compared to HKD 12.8 million for the same period in 2021, reflecting a year-on-year increase of 37.5%[144] - Administrative expenses rose from approximately HKD 12.0 million to about HKD 22.9 million, an increase of approximately HKD 10.9 million or 90.8%[116] - Financing costs increased from approximately HKD 258,000 to about HKD 2.774 million, primarily due to interest on new borrowings from related parties[119] Corporate Governance and Leadership - The company is committed to maintaining good corporate governance practices to enhance business growth and meet stakeholder expectations[164] - The company has appointed Mr. Dasha as both the Chairman of the Board and CEO effective from July 12, 2022, to provide strong and consistent leadership for business development[165] - The Audit Committee, consisting of three members, is responsible for reviewing financial information and overseeing the financial reporting system, risk management, and internal control systems[171] Market Outlook and Strategy - The company plans to expand its market presence in the apparel supply chain management sector, focusing on strategic partnerships and collaborations[26] - The company anticipates a continued decline in customer orders and sales for the 2022-2023 period due to adverse trade conditions and the ongoing impact of the COVID-19 pandemic[89] - The board anticipates a slow recovery in global economic activity, with a gradual increase in demand for the company's products, although uncertainties remain due to the ongoing Covid-19 pandemic[149] - The company will continue to monitor the impact of the Covid-19 pandemic and may implement measures such as prioritizing higher-margin orders and cost control to mitigate operational challenges[149] Acquisitions and Investments - The company completed the acquisition of approximately 95% of the equity of Shanghai Rixin Pharmaceutical Development Co., Ltd. for a total consideration of approximately HKD 3.24 million[79] - The net identifiable assets acquired in the acquisition included property, plant, and equipment valued at HKD 505,000 and inventory valued at HKD 119,000[80] - The company has capital commitments of HKD 4.859 million for equity investments and HKD 2.710 million for investments in limited partnerships as of September 30, 2022[140] Compliance and Reporting - The company is committed to maintaining compliance with the Hong Kong Financial Reporting Standards, ensuring transparency and accuracy in its financial reporting[27] - There have been no significant events after September 30, 2022, that could materially impact the company's operational and financial performance[170]

Financial Performance - The company reported a revenue of approximately HKD 424.7 million for the fiscal year ending March 31, 2022, representing an increase of about 4.7% compared to HKD 405.4 million for the previous year[18]. - Gross profit for the fiscal year was approximately HKD 62.5 million, up from HKD 54.0 million in the previous year, indicating a significant increase driven by increased orders from a major US client[18]. - The group reported a total comprehensive income attributable to owners of approximately HKD 17.8 million for the year ended March 31, 2022, compared to HKD 6.6 million for the previous year, with losses primarily due to new drug development costs of approximately HKD 13.6 million and a cash offer cost of approximately HKD 1.4 million related to a change in control announced on May 5, 2022[23]. - The group's revenue increased by approximately 4.7% or HKD 19.2 million from approximately HKD 405.4 million for the year ended March 31, 2021, to approximately HKD 424.6 million for the year ended March 31, 2022, mainly due to a significant increase in procurement orders from a major customer based in the United States[30]. - Sales cost increased by approximately 3.0% from HKD 351.4 million to HKD 362.1 million for the year ended March 31, 2022, aligning with a revenue increase of about 4.7%[38]. - Gross profit rose by approximately 15.8% from HKD 54.0 million to HKD 62.6 million, with gross margin improving from about 13.3% to 14.7% due to higher average selling prices[39]. - The company reported a comprehensive loss attributable to owners of approximately HKD 17.8 million for the year ended March 31, 2022, a decrease of about HKD 24.4 million compared to the previous year[52]. - Basic loss per share for the year ended March 31, 2022, was approximately HKD 0.035, a significant decline from a basic earnings of HKD 0.013 in the previous year[53]. Business Expansion and Strategy - The company is optimistic about future growth in apparel supply chain management services, driven by rising disposable income and retail value growth in Japan and the US[13]. - The company plans to expand its service offerings from pharmaceuticals to the entire healthcare industry, including medical devices and health foods, with a focus on the Chinese market[13]. - The company aims to become a solutions provider for the entire healthcare industry in China, responding to the shift towards drug discovery technologies and partnerships with academic institutions and biotech firms[13]. - The company has established three new subsidiaries in Japan during the fiscal year, focusing on new drug development services and pharmaceutical consulting[17]. - The company has expanded its Japan office to better serve existing clients and attract new mid-to-high-end fashion brands[18]. - The group plans to expand its service offerings from pharmaceutical products to the entire healthcare industry, including medical devices and health foods[76]. - The group aims to become a solution provider for the entire healthcare industry in China, focusing on drug development and distribution[76]. Segment Performance - The women's apparel segment generated revenue of approximately HKD 323.6 million for the year ended March 31, 2022, an increase of approximately HKD 8.7 million or 2.8% from approximately HKD 314.9 million in the previous year, driven by an increase in average selling price from HKD 64.3 to HKD 78.3[31]. - The men's apparel segment revenue decreased by approximately HKD 2.5 million or 3.9% to approximately HKD 61.9 million for the year ended March 31, 2022, due to a decline in sales volume from approximately 1.1 million pieces to approximately 1.0 million pieces, despite an increase in average selling price from HKD 57.9 to HKD 64.2[34]. - The children's apparel segment saw a significant revenue increase of approximately HKD 17.2 million or 78.7% to approximately HKD 39.1 million for the year ended March 31, 2022, attributed to an increase in sales volume from approximately 0.4 million pieces to approximately 0.7 million pieces and an increase in average selling price from HKD 55.7 to HKD 58.1[35]. - The group recorded revenue of approximately HKD 18,000 from healthcare services during the reporting year[37]. Governance and Management - The company has established a robust governance structure with independent directors overseeing strategy, performance, and compliance[85][86]. - The management team continuously assesses credit risk and maintains cash and cash equivalents at levels deemed sufficient to mitigate cash flow volatility[59]. - The company has adopted the corporate governance code as per the listing rules and is committed to enhancing its governance standards to meet stakeholder expectations[99]. - The board of directors consists of a mix of executive and non-executive members, ensuring a balance of power and independence[104]. - The company has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee to oversee specific areas of governance[120]. - The Audit Committee is responsible for reviewing the company's financial information and monitoring the effectiveness of the financial reporting system and internal controls[124]. - The company has no internal audit function and believes that appointing external professionals for this role is more cost-effective given the business's scale and complexity[136]. - The company emphasizes the importance of independent judgment in its operations, as highlighted by the roles of independent directors in key committees[85][86]. Sustainability and ESG - The group is committed to reducing its environmental impact and has set both short-term and long-term sustainability goals[187]. - The board is responsible for overseeing the group's ESG strategy and ensuring compliance with relevant regulations[186]. - The ESG report includes key performance indicators (KPIs) that are quantifiable and comparable to past performance[192]. - The report adheres to the "comply or explain" principle as per the ESG reporting guidelines[184]. - The group will continue to optimize and improve the disclosure of KPIs in future reports[192]. - The company emphasizes compliance with applicable laws and anti-corruption measures in its dealings with suppliers and business partners[200]. - Community support initiatives focus on improving employees' environmental awareness and encouraging social commitments[200]. Financial Position and Ratios - Current assets increased by approximately 62.5%, while current liabilities surged by about 167.2%, resulting in a decrease in the current ratio from approximately 8.2 to 5.0[58]. - The group's debt-to-equity ratio as of March 31, 2022, was 0.96, compared to 0.13 as of March 31, 2021, indicating a significant increase in leverage[59]. - Total employee costs for the year ended March 31, 2022, were approximately HKD 27.7 million, up from HKD 21.2 million for the previous year, indicating a 30.8% increase[70]. - The group has no significant contingent liabilities as of March 31, 2022, consistent with the previous year[65]. Shareholder Engagement - The group has established communication channels with shareholders, including annual and interim reports, announcements, and its website[180]. - Shareholders holding at least 10% of the paid-up capital have the right to request a special general meeting to address specified matters[171]. - The company must hold an annual general meeting each year, with the location determined by the board[168].

[Financial Highlights](index=3&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) [Financial Highlights](index=3&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) For the six months ended September 30, 2021, the company recorded revenue of approximately **HKD 246 million**, turning from profit to loss with a post-tax loss of approximately **HKD 5.6 million** and basic loss per share of **1.1 HK cents** The Board decided not to declare an interim dividend Key Performance Indicators for 2021/2022 Interim Results | Indicator | Amount/Value | | :--- | :--- | | Revenue | Approx. HKD 245.8 million | | Loss for the Period After Tax | Approx. HKD 5.6 million | | Basic Loss Per Share | Approx. 1.1 HK cents | | Interim Dividend | Not Recommended | [Financial Information](index=4&type=section&id=%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive (Loss) Income](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%EF%BC%88%E虧%E6%90%8D%EF%BC%89%E6%94%B6%E7%9B%8A%E8%A1%A8) During the reporting period, the company's revenue increased by **19.1%** year-on-year to **HKD 246 million**, with gross profit increasing to **HKD 30.6 million** However, due to increased costs such as new drug R&D expenses, administrative expenses, and professional fees for the mandatory cash offer, the company turned from a profit of **HKD 4.45 million** in the same period last year to a loss of **HKD 5.59 million** Key Data from Consolidated Statement of Profit or Loss (For the six months ended September 30) | Item | 2021 (HKD '000) | 2020 (HKD '000) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Revenue | 245,768 | 206,332 | +19.1% | | Gross Profit | 30,600 | 26,845 | +14.0% | | (Loss) Profit Before Tax | (4,447) | 4,977 | Turned from profit to loss | | (Loss) Profit for the Period | (5,594) | 4,447 | Turned from profit to loss | | Basic (Loss) Earnings Per Share (HK cents) | (1.1) | 0.9 | Turned from profit to loss | [Condensed Consolidated Statement of Financial Position](index=6&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of September 30, 2021, the company's total assets increased to **HKD 327 million**, primarily due to a significant increase in bank and cash balances However, current liabilities rose sharply due to a surge in trade and other payables and amounts due to related companies, leading to a decrease in the current ratio despite growth in net current assets The company's net assets slightly decreased to **HKD 130 million** Key Financial Position Data | Item | September 30, 2021 (HKD '000) | March 31, 2021 (HKD '000) | Change | | :--- | :--- | :--- | :--- | | Total Assets | 326,930 | 151,167 | +116.3% | | Total Liabilities | 197,251 | 18,022 | +994.5% | | Net Assets | 129,679 | 133,145 | -2.6% | | Net Current Assets | 170,574 | 129,063 | +32.2% | | Bank and Cash Balances | 184,109 | 85,235 | +116.0% | [Condensed Consolidated Statement of Cash Flows](index=9&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) During the reporting period, the company's operating cash flow showed strong performance, turning from a net outflow of **HKD 63.37 million** in the same period last year to a net inflow of **HKD 98.71 million**, primarily due to improved working capital Cash and cash equivalents at period-end significantly increased to **HKD 184 million** Key Cash Flow Data (For the six months ended September 30) | Item | 2021 (HKD '000) | 2020 (HKD '000) | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 98,713 | (63,369) | | Net Cash Generated from Investing Activities | 2,103 | (333) | | Net Cash (Used in) from Financing Activities | (1,963) | (861) | | Net Increase in Cash and Cash Equivalents | 98,853 | (64,563) | | Cash and Cash Equivalents at End of Period | 184,109 | 34,788 | [Notes to the Condensed Consolidated Financial Statements](index=10&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E6%B3%A8) [General Information and Basis of Preparation](index=10&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) This note outlines the company's general information, accounting policies, and application of new standards During the reporting period, the company's name changed from “Speed Apparel Holding Limited” to “EPS Creative Health Technology Group Limited”, and its main business expanded to include apparel supply chain management and new drug R&D services The financial statements are prepared in accordance with Hong Kong Accounting Standards - Company's English name changed to “EPS Creative Health Technology Group Limited”, and its dual foreign name changed to “EPS创健科技集团有限公司” to reflect business expansion[27](index=27&type=chunk) - Main businesses include apparel supply chain management services and new drug R&D services[28](index=28&type=chunk) [Revenue Analysis](index=11&type=section&id=4.%20%E6%94%B6%E7%9B%8A) During the reporting period, the company's total revenue was **HKD 246 million**, entirely from apparel supply chain management services, with new drug R&D services not yet generating revenue By region, Japan and the United States were the main markets, with significant revenue growth in the US market By product category, women's wear remained the largest revenue source, and all apparel categories achieved growth Revenue by Business Segment (HKD '000) | Business Segment | 2021 | 2020 | | :--- | :--- | :--- | | Apparel Supply Chain Management Services | 245,768 | 206,332 | | New Drug R&D Services | – | – | | **Total** | **245,768** | **206,332** | Revenue by Geographical Market (HKD '000) | Geographical Market | 2021 | 2020 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Japan | 100,230 | 102,020 | -1.7% | | United States of America | 88,970 | 64,884 | +37.1% | | Europe | 34,906 | 29,899 | +16.7% | | Hong Kong | 15,335 | 7,567 | +102.7% | | Others | 6,327 | 1,962 | +222.5% | - During the reporting period, two major customers contributed the majority of the company's revenue, with Customer A contributing **HKD 129 million** and Customer B contributing **HKD 55.81 million**[49](index=49&type=chunk) [Dividends and Earnings Per Share](index=16&type=section&id=8.%20%E8%82%A1%E6%81%AF) Due to the loss recorded during the reporting period, the company's basic loss per share was **1.1 HK cents**, compared to basic earnings per share of **0.9 HK cents** in the same period last year The Board does not recommend the payment of any interim dividend for the six months ended September 30, 2021 - The Board does not recommend the payment of any interim dividend[53](index=53&type=chunk) Calculation of Basic (Loss) Earnings Per Share | Item | 2021 | 2020 | | :--- | :--- | :--- | | (Loss) Profit for the Period Attributable to Owners of the Company (HKD '000) | (5,594) | 4,447 | | Weighted Average Number of Ordinary Shares ('000) | 500,000 | 500,000 | | **Basic (Loss) Earnings Per Share (HK cents)** | **(1.1)** | **0.9** | [Management Discussion and Analysis](index=21&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) [Business Review](index=21&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) Despite a complex trade environment and the impact of the pandemic, the Group's revenue increased by **19.1%** to **HKD 246 million** during the reporting period, driven by increased orders from US and Japanese customers The company has established a joint venture, formally entering the new drug R&D field However, due to new drug R&D investments of approximately **HKD 5.4 million** and professional fees of approximately **HKD 1.4 million** arising from the change in company control, the Group turned from profit to loss - Revenue growth primarily resulted from increased purchase orders from major US customers and other Japanese customers[77](index=77&type=chunk) - Established a joint venture to enter new drug R&D businesses, including drug screening for Parkinson's syndrome, weight-loss related drugs, and functional food screening[76](index=76&type=chunk) - Loss for the period mainly stemmed from research expenses for new drug development (approx. **HKD 5.4 million**) and professional fees for the unconditional mandatory cash offer (approx. **HKD 1.4 million**)[77](index=77&type=chunk) [Financial Review](index=22&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section provides a detailed analysis of financial performance Revenue growth of **19.1%** was primarily driven by both increased sales volume and average selling prices Revenue from women's wear, men's wear, and children's wear all recorded double-digit growth Gross profit margin slightly decreased from **13.0%** to **12.5%**, mainly due to more competitive pricing offered to Japanese customers Increased expenses in sales, administration, and R&D led to the company turning from profit to loss overall Revenue and Changes by Product Category | Product Category | 2021 Revenue (HKD '000) | 2020 Revenue (HKD '000) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Women's Wear | 158,242 | 137,548 | +15.0% | | Men's Wear | 52,051 | 45,053 | +15.5% | | Children's Wear | 35,475 | 20,287 | +74.9% | | **Total** | **245,768** | **206,332** | **+19.1%** | - Gross profit margin decreased from **13.0%** in the prior period to **12.5%** in the reporting period, primarily due to offering competitive pricing to Japanese customers[92](index=92&type=chunk) - New drug development R&D expenses of approximately **HKD 5.4 million** were a significant contributor to the loss[99](index=99&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=26&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group maintains a sound financial position with ample liquidity As of the end of the reporting period, bank and cash balances significantly increased to **HKD 184 million**, and net current assets were **HKD 171 million** The gearing ratio remained at a very low level of **0.6%** The capital structure remained stable, consisting solely of ordinary shares Liquidity and Financial Resources Indicators | Indicator | September 30, 2021 | March 31, 2021 | | :--- | :--- | :--- | | Net Current Assets | Approx. HKD 170.6 million | Approx. HKD 129.1 million | | Bank and Cash Balances | Approx. HKD 184.1 million | Approx. HKD 85.2 million | | Gearing Ratio | 0.6% | 1.8% | - The company's capital structure remained unchanged during the reporting period, with equity consisting solely of **500 million** ordinary shares[112](index=112&type=chunk)[113](index=113&type=chunk) [Future Outlook](index=29&type=section&id=%E6%9C%AA%E4%BE%86%E5%89%8D%E6%99%AF) Looking ahead, management anticipates a slow global economic recovery, but uncertainties from the COVID-19 pandemic persist The Group will continue to closely monitor market dynamics, implement cost control measures, and actively promote products through online platforms, business referrals, and video conferences, while also exploring business diversification opportunities - The Board expects a slow increase in demand for the Group's products, but uncertainties remain for the rest of the 2021/2022 fiscal year, and appropriate measures, including cost control, will be taken to address challenges[128](index=128&type=chunk) - The Group will actively promote products through online platforms, business networks, video conferences, and continue to explore business diversification opportunities[129](index=129&type=chunk) [Other Information](index=30&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) [Interests of Major Shareholders](index=30&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%82%B5%E6%AC%8A%E8%AD%89%E4%B8%AD%E4%B9%8B%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) As of September 30, 2021, EPS HD was the company's major controlling shareholder Through its holding structure, Mr Yan Hao was deemed to hold **375 million** shares of the company, representing **75%** of the issued share capital Major Shareholder Holdings | Shareholder Name | Nature of Interest | Number of Shares Held | Percentage of Holding | | :--- | :--- | :--- | :--- | | EPS HD | Beneficial Owner | 375,000,000 (L) | 75% | | Shinyou Corporation | Interest in Controlled Corporation | 375,000,000 (L) | 75% | | Mr Yan | Interest in Controlled Corporation | 375,000,000 (L) | 75% | [Corporate Governance Practices](index=32&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The company is committed to maintaining a high level of corporate governance During the reporting period, the company complied with most provisions of the Corporate Governance Code, with only a brief deviation regarding the separation of Chairman and Chief Executive roles, which was resolved on June 30, 2021 The Audit Committee has reviewed this interim report - During the reporting period, the company complied with all code provisions of the Corporate Governance Code, with a brief deviation from code provision A.2.1 regarding the separation of Chairman and Chief Executive roles, which was rectified on June 30, 2021[143](index=143&type=chunk) - The Audit Committee, comprising three members, has reviewed this interim results report[149](index=149&type=chunk) [Company Information](index=34&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) [Company Information](index=34&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section lists key company information including Board members, committee compositions, company secretary, auditor, registered office, principal bankers, and stock code Significant changes occurred in the Board and committee members during the reporting period - Lists executive directors, non-executive directors, independent non-executive directors, and members and changes of various committees (Remuneration, Nomination, Audit)[150](index=150&type=chunk) - Provides information on the company's registered office, principal place of business in Hong Kong, share registrar, legal advisors, principal bankers, and company website[150](index=150&type=chunk)[154](index=154&type=chunk)

Speed Apparel Holding Limited 尚捷集團控股有限公 司 (Incorporated in the Cayman Islands with limited liability) Stock Code: 3860 ANNUAL REPORT 2020/2021 Speed Apparel Holding Limited 尚捷集團控股有限公 司 股份代號: 3860 （於開曼群島註冊成立之有限公司） 年 報 2020/2021 | --- | --- | |-------|----------------------------| | | | | | | | | | | | | | | 目錄 | | | | | | | | | 公司資料 | | | 主席報告 | | | 管理層討論與分析 | | | 董事及高級管理層之履歷詳情 | | | 企業管治報告 | | | 環境、社會及管治報告 | | | 董事會報告 | | | 獨立核數師報告 | | | 綜合損益及其他全面收益表 | | | 綜合財務狀況表 | | | 綜合權益變動表 | | | 綜合現金流量表 | | | 綜合財務報表附註 ...

[Financial Highlights](index=2&type=section&id=Financial%20Highlights) For the six months ended September 30, 2020, Speed Apparel Group reported revenue of approximately **HKD 206.3 million**, profit after tax of approximately **HKD 4.4 million**, and basic earnings per share of approximately **HKD 0.9 cents**. The Board does not recommend an interim dividend Financial Highlights for the Six Months Ended September 30, 2020 | Indicator | Amount (million HKD) | | :--- | :--- | | Revenue | 206.3 | | Profit after tax | 4.4 | | Basic earnings per share | 0.9 HK cents | | Interim dividend | Not recommended | [Financial Information](index=3&type=section&id=Financial%20Information) [Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended September 30, 2020, the Group's revenue significantly decreased by **31.8%** to **HKD 206.3 million**, gross profit fell by **49.9%** to **HKD 26.8 million**, profit for the period sharply declined from **HKD 18.7 million** to **HKD 4.4 million**, and basic earnings per share dropped to **HKD 0.9 cents** Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended September 30) | Indicator | 2020 (thousand HKD) | 2019 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 206,332 | 302,664 | -31.8% | | Gross profit | 26,845 | 53,580 | -49.9% | | Profit before tax | 4,977 | 22,993 | -78.4% | | Profit for the period | 4,447 | 18,735 | -76.3% | | Basic earnings per share attributable to owners of the Company | 0.9 HK cents | 3.7 HK cents | -75.7% | [Unaudited Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of September 30, 2020, the Group's net current assets increased to **HKD 126.1 million**, total assets less current liabilities increased to **HKD 131.9 million**, and net assets increased to **HKD 131.0 million**, primarily due to changes in inventories, trade receivables, and bank balances within current assets Condensed Consolidated Statement of Financial Position (As of September 30) | Indicator | September 30, 2020 (thousand HKD) | March 31, 2020 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 5,760 | 5,847 | -1.5% | | Current assets | 204,510 | 152,532 | +34.1% | | Inventories | 13,932 | 4,587 | +203.7% | | Trade and bills receivables | 116,966 | 23,079 | +406.8% | | Bank and cash balances | 34,788 | 99,503 | -65.0% | | Current liabilities | 78,405 | 30,243 | +159.3% | | Trade and other payables | 75,615 | 27,308 | +176.9% | | Net current assets | 126,105 | 122,289 | +3.1% | | Net assets | 131,001 | 126,530 | +3.5% | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended September 30, 2020, total equity attributable to owners of the Company increased to **HKD 131.0 million**, primarily due to profit for the period of **HKD 4.4 million** and exchange differences of **HKD 24 thousand** Condensed Consolidated Statement of Changes in Equity (For the six months ended September 30) | Indicator | September 30, 2020 (thousand HKD) | April 1, 2020 (thousand HKD) | | :--- | :--- | :--- | | Share capital | 5,000 | 5,000 | | Reserves | 126,001 | 121,530 | | Total equity | 131,001 | 126,530 | | Profit for the period | 4,447 | - | | Exchange differences arising from translation of overseas operations | 24 | - | [Unaudited Condensed Consolidated Statement of Cash Flows](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended September 30, 2020, net cash used in operating activities significantly increased to **HKD 63.4 million**, investing activities shifted from net inflow to net outflow, and net cash used in financing activities decreased, resulting in a net decrease in cash and cash equivalents of **HKD 64.6 million** Condensed Consolidated Statement of Cash Flows (For the six months ended September 30) | Indicator | 2020 (thousand HKD) | 2019 (thousand HKD) | | :--- | :--- | :--- | | Net cash used in operating activities | (63,369) | (4,656) | | Net cash (used in) generated from investing activities | (333) | 6,857 | | Net cash used in financing activities | (861) | (8,676) | | Net decrease in cash and cash equivalents | (64,563) | (6,475) | | Cash and cash equivalents at end of period | 34,788 | 71,079 | [Notes to the Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [General Information](index=7&type=section&id=General%20Information) Speed Apparel Group Holdings Limited, incorporated in the Cayman Islands, primarily provides supply chain management services for knitwear products, with its shares transferred to the Main Board of the Stock Exchange (stock code: 3860) on December 12, 2019 - The Company is an investment holding company, primarily engaged in providing apparel supply chain management services for the sale of knitwear products to customers[29](index=29&type=chunk) - The Company's shares were transferred from GEM to the Main Board of the Stock Exchange on **December 12, 2019**, with stock code **3860**[30](index=30&type=chunk) [Basis of Preparation](index=7&type=section&id=Basis%20of%20Preparation) The interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the HKICPA and the Listing Rules of the Stock Exchange, using the historical cost convention, and have been reviewed by the Audit Committee - The interim financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants and the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[31](index=31&type=chunk) - The interim financial statements are prepared under the historical cost convention and have been reviewed by the Audit Committee of the Company[31](index=31&type=chunk) [Adoption of New and Revised Hong Kong Financial Reporting Standards](index=8&type=section&id=Adoption%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group has adopted new and revised Hong Kong Financial Reporting Standards effective from April 1, 2020, which are not expected to have a significant impact on the interim financial statements - The Group has adopted new and revised Hong Kong Financial Reporting Standards effective for the financial year beginning on **April 1, 2020**[33](index=33&type=chunk) - The Directors do not expect the application of these new and revised Hong Kong Financial Reporting Standards to have a significant impact on the interim financial statements[33](index=33&type=chunk) [Revenue](index=8&type=section&id=Revenue) For the six months ended September 30, 2020, the Group's total revenue was **HKD 206.3 million**, a **31.8%** decrease year-on-year, with significant declines in revenue from Japan, the United States, and European markets, and all product categories experiencing reduced revenue despite ladies' wear remaining the primary category [Geographical Information](index=8&type=section&id=Geographical%20Information) Japan, the United States, and Europe are key markets, but all experienced significant revenue declines for the six months ended September 30, 2020 Revenue by Geographical Market (thousand HKD) | Geographical market | 2020 | 2019 | Change (%) | | :--- | :--- | :--- | :--- | | Japan | 102,020 | 141,966 | -28.1% | | United States of America | 64,884 | 97,509 | -33.5% | | Europe | 29,899 | 47,037 | -36.4% | | Hong Kong | 7,567 | 14,017 | -46.0% | | Others | 1,962 | 2,135 | -8.0% | | Total revenue | 206,332 | 302,664 | -31.8% | [Major Products](index=8&type=section&id=Major%20Products) Ladies' wear remains the Group's primary revenue source, accounting for **66.7%** of total revenue, but its revenue同比下降31.6%。男裝和童裝收益也分別下降38.8%和27.3%。新增其他產品（如針織口罩）貢獻3.4百萬港元收益。 Revenue by Product Category (thousand HKD) | Major product | 2020 | 2019 | Change (%) | | :--- | :--- | :--- | :--- | | Ladies' wear | 137,548 | 201,143 | -31.6% | | Men's wear | 45,053 | 73,626 | -38.8% | | Children's wear | 20,287 | 27,895 | -27.3% | | Others | 3,444 | – | N/A | - Other products, including knit masks and beanies, are new revenue sources for the period[35](index=35&type=chunk) [Timing of Revenue Recognition and Sales of Apparel](index=9&type=section&id=Timing%20of%20Revenue%20Recognition%20and%20Sales%20of%20Apparel) All revenue is recognized at a point in time when control of the products is transferred to customers, with the Group generally providing credit terms of **30 to 90 days** - All revenue is recognized at a point in time when products are delivered to customers and control is transferred[38](index=38&type=chunk)[39](index=39&type=chunk) - The Group generally makes sales to customers on credit terms of **30 to 90 days**[39](index=39&type=chunk) [Other Income](index=9&type=section&id=Other%20Income) For the six months ended September 30, 2020, other income increased to **HKD 1.0 million**, primarily driven by **HKD 1.4 million** in government grants, partially offset by exchange losses Other Income Details (thousand HKD) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Government grants | 1,431 | – | | Sample sales income | 293 | 508 | | Net exchange difference (loss) gain | (675) | 266 | | Total other income | 1,049 | 774 | - Government grants were the primary reason for the increase in other income during the period, reaching **HKD 1.4 million**[40](index=40&type=chunk) [Segment Information](index=10&type=section&id=Segment%20Information) The Group operates in a single business segment: apparel trading, with key operating decision-makers monitoring overall revenue, performance, assets, and liabilities, and Hong Kong being the primary business location [Geographical Information (Non-current Assets)](index=10&type=section&id=Geographical%20Information%20(Non-current%20Assets)) As of September 30, 2020, the Group's non-current assets were primarily located in Hong Kong, with new non-current assets added in China Non-current Assets by Geographical Market (thousand HKD) | Geographical market | September 30, 2020 | March 31, 2020 | | :--- | :--- | :--- | | Hong Kong | 4,295 | 4,898 | | Japan | 720 | 949 | | China | 745 | – | | Total non-current assets | 5,760 | 5,847 | [Revenue from Major Customers](index=10&type=section&id=Revenue%20from%20Major%20Customers) For the six months ended September 30, 2020, Customer A and Customer B remained major customers but their revenue contributions significantly decreased, while Customer C emerged as a new major customer Revenue from Major Customers (thousand HKD) | Customer | 2020 | 2019 | | :--- | :--- | :--- | | Customer A | 98,543 | 153,486 | | Customer B | 51,172 | 75,808 | | Customer C | 21,991 | Not applicable * | * Corresponding revenue did not contribute more than **10%** of the Group's revenue during that period [Income Tax Expense](index=11&type=section&id=Income%20Tax%20Expense) For the six months ended September 30, 2020, income tax expense significantly decreased to **HKD 530 thousand**, primarily due to reductions in Hong Kong profits tax and PRC enterprise income tax Income Tax Expense Analysis (thousand HKD) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Hong Kong profits tax | 549 | 4,291 | | PRC enterprise income tax | 3 | (56) | | Deferred tax (credit) expense | (22) | 23 | | Total income tax expense | 530 | 4,258 | - Hong Kong profits tax is calculated at **16.5%**, PRC enterprise income tax at **25%**, and the effective statutory income tax rate for the Japanese subsidiary is approximately **21.36%**[51](index=51&type=chunk) [Dividends](index=12&type=section&id=Dividends) The Board does not recommend the payment of any dividends for the six months ended September 30, 2020, compared to **HKD 8.0 million** in dividends paid during the same period last year - The Board does not recommend the payment of any dividends for the six months ended September 30, 2020[54](index=54&type=chunk) - Dividends of **HKD 8.0 million** were paid for the six months ended September 30, 2019, with none for the current period[54](index=54&type=chunk) [Profit for the Period](index=12&type=section&id=Profit%20for%20the%20Period) Profit for the period is derived after deducting expenses such as staff costs, depreciation, exchange losses, and cost of sales, with total employee benefits expense slightly decreasing and cost of sales significantly declining due to reduced revenue Profit for the Period Deducted (Credited) Items (thousand HKD) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Total employee benefits expense | 10,691 | 11,328 | | Depreciation of property, plant and equipment | 480 | 550 | | Depreciation of right-of-use assets | 918 | 562 | | Net exchange loss (gain) | 675 | (266) | | Cost of inventories recognized as cost of sales | 179,487 | 249,084 | | Commission expenses | 2,597 | 4,035 | | Sample expenses | 4,226 | 6,185 | [Earnings Per Share](index=13&type=section&id=Earnings%20Per%20Share) For the six months ended September 30, 2020, basic earnings per share was **HKD 0.9 cents**, a significant decrease from **HKD 3.7 cents** in the prior year, primarily due to reduced profit for the period Basic Earnings Per Share Calculation (For the six months ended September 30) | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company for basic EPS calculation (thousand HKD) | 4,447 | 18,735 | | Weighted average number of ordinary shares (thousand shares) | 500,000 | 500,000 | | Basic earnings per share attributable to owners of the Company (HK cents) | 0.9 | 3.7 | - Diluted earnings per share is not presented as there were no outstanding potential dilutive ordinary shares[58](index=58&type=chunk) [Property, Plant and Equipment](index=13&type=section&id=Property%2C%20Plant%20and%20Equipment) For the six months ended September 30, 2020, the Group acquired property, plant and equipment of approximately **HKD 0.4 million**, an increase compared to the same period last year - The Group acquired property, plant and equipment of approximately **HKD 0.4 million** (2019: approximately **HKD 0.1 million**)[59](index=59&type=chunk) [Right-of-use Assets](index=13&type=section&id=Right-of-use%20Assets) For the six months ended September 30, 2020, the Group entered into a new lease agreement for its China office, recognizing right-of-use assets and lease liabilities of approximately **HKD 0.9 million** - The Group entered into a new lease agreement for its China office, recognizing right-of-use assets of approximately **HKD 0.9 million** and lease liabilities of approximately **HKD 0.9 million**[60](index=60&type=chunk) [Trade and Bills Receivables](index=14&type=section&id=Trade%20and%20Bills%20Receivables) As of September 30, 2020, trade and bills receivables significantly increased to **HKD 117.0 million**, with the **1 to 30 days** aging category accounting for the largest proportion Aging Analysis of Trade and Bills Receivables (thousand HKD) | Aging | September 30, 2020 | March 31, 2020 | | :--- | :--- | :--- | | 1 to 30 days | 57,484 | 18,152 | | 31 to 60 days | 42,088 | 63 | | Total | 116,966 | 23,079 | - The Group has not made any impairment provision for doubtful debts and grants an average credit period of **30 to 90 days** to long-term customers[63](index=63&type=chunk) [Pledged Bank Deposits](index=14&type=section&id=Pledged%20Bank%20Deposits) Pledged bank deposits of approximately **HKD 8.1 million** are used to secure the Group's bank facilities, remaining largely consistent with the previous period-end - Pledged bank deposits of approximately **HKD 8.1 million** (March 31, 2020: approximately **HKD 8.1 million**) were pledged to banks to secure certain bank facilities granted to the Group[65](index=65&type=chunk) [Trade and Other Payables](index=14&type=section&id=Trade%20and%20Other%20Payables) As of September 30, 2020, trade and other payables significantly increased to **HKD 75.6 million**, with trade payables accounting for **HKD 65.7 million**, primarily concentrated in the **1 to 30 days** aging category Trade and Other Payables Details (thousand HKD) | Item | September 30, 2020 | March 31, 2020 | | :--- | :--- | :--- | | Trade payables | 65,716 | 23,084 | | Accruals and other payables | 9,899 | 4,224 | | Total | 75,615 | 27,308 | Aging Analysis of Trade Payables (thousand HKD) | Aging | September 30, 2020 | March 31, 2020 | | :--- | :--- | :--- | | 1 to 30 days | 44,518 | 16,938 | | 31 to 60 days | 20,732 | 4,018 | | 61 to 90 days | 65 | 1,652 | | Over 90 days | 401 | 476 | | Total | 65,716 | 23,084 | - The credit period for purchases of goods ranges from **30 to 45 days**[69](index=69&type=chunk) [Share Capital](index=15&type=section&id=Share%20Capital) As of September 30, 2020, the Company's authorized share capital was **1,000,000 thousand shares**, and issued and fully paid share capital was **500,000 thousand shares** with a par value of **HKD 0.01** per share, totaling **HKD 5.0 million**, remaining unchanged from the previous period-end Share Capital Details (thousand shares) | Item | Number of shares | | :--- | :--- | | Authorised share capital | 1,000,000 | | Issued and fully paid share capital | 500,000 | - The par value per share is **HKD 0.01**, and the total share capital is **HKD 5.0 million**[70](index=70&type=chunk) [Related Party Disclosures](index=16&type=section&id=Related%20Party%20Disclosures) The Group has lease transactions with Firenze Apparel Limited, wholly owned by Chairman Mr. Chan, and Mr. Chan's wife, Ms. Cheung Hung, provides guarantees for certain finance leases, with key management personnel compensation totaling **HKD 2.91 million** [Related Party Transactions](index=16&type=section&id=Related%20Party%20Transactions) The Group pays **HKD 100,000** per month in lease payments to Firenze Apparel Limited, wholly owned by Chairman Mr. Chan Related Party Transactions (thousand HKD) | Related party name | Nature of transaction | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Firenze Apparel Limited | Lease payments | 600 | 600 | - Firenze Apparel is wholly and beneficially owned by Mr. Chan, the Chairman and Executive Director of the Company[73](index=73&type=chunk) [Pledges and Guarantees Provided by Related Parties](index=16&type=section&id=Pledges%20and%20Guarantees%20Provided%20by%20Related%20Parties) As of September 30, 2020, finance lease payables of approximately **HKD 68,000** were guaranteed by Ms. Cheung Hung, the wife of Mr. Chan - Finance lease payables of approximately **HKD 68,000** (March 31, 2020: approximately **HKD 134,000**) were guaranteed by Ms. Cheung Hung, the wife of Mr. Chan[74](index=74&type=chunk) [Key Management Personnel Compensation](index=16&type=section&id=Key%20Management%20Personnel%20Compensation) For the six months ended September 30, 2020, key management personnel compensation totaled **HKD 2.91 million**, remaining largely consistent with the same period last year Key Management Personnel Compensation (thousand HKD) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Directors' fees | 180 | 180 | | Salaries and other benefits | 2,685 | 2,639 | | Retirement benefit scheme contributions | 45 | 45 | | Total | 2,910 | 2,864 | [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) [Introduction](index=17&type=section&id=Introduction) Speed Apparel Group is a Hong Kong-based apparel supply chain management service provider, primarily selling knitwear products and offering one-stop solutions to customers, mainly Japanese and US brands, with all manufacturing outsourced to third-party manufacturers - The Group is an apparel supply chain management service provider in Hong Kong, primarily engaged in the business of selling knitwear products[80](index=80&type=chunk) - It provides one-stop apparel supply chain management solutions, including fashion trend analysis, product design, material sourcing, production management, quality control, and logistics services[80](index=80&type=chunk) - Customers are mainly Japanese and US apparel retail brand owners or sourcing agents, with all manufacturing processes outsourced to third-party manufacturers in China, Thailand, and/or Cambodia[80](index=80&type=chunk) [Business Review](index=17&type=section&id=Business%20Review) Affected by the COVID-19 pandemic, the Group's revenue and profitability sharply declined, with revenue decreasing by **31.8%** year-on-year to **HKD 206.3 million** and gross profit margin falling from **17.7%** to **13.0%**, yet the Group successfully attracted new mid-to-high-end apparel brands and expanded its China office - The COVID-19 pandemic led to global lockdowns, significantly impacting the apparel retail market and causing a substantial decrease in demand for the Group's products[81](index=81&type=chunk) Key Financial Data for Business Review (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 206.3 | 302.7 | -31.8% | | Gross profit | 26.8 | 53.6 | -49.9% | | Gross profit margin | 13.0% | 17.7% | -4.7 percentage points | | Total comprehensive income attributable to owners of the Company | 4.5 | 18.6 | -76.0% | - The Group successfully attracted no less than three new mid-to-high-end apparel brands and expanded its China office to facilitate production management[81](index=81&type=chunk) [Financial Review](index=18&type=section&id=Financial%20Review) This section provides a detailed review of the Group's financial performance during the reporting period, including changes in key indicators such as revenue, costs, profits, expenses, and earnings per share, along with their primary causes [Revenue](index=18&type=section&id=Revenue) For the six months ended September 30, 2020, total revenue decreased by **31.8%** to **HKD 206.3 million**, primarily due to reduced purchasing orders from US and Japanese customers, with ladies' wear remaining the main product but all product categories experiencing significant sales volume declines Revenue and Sales Volume by Product Category (For the six months ended September 30) | Product category | 2020 Revenue (thousand HKD) | 2019 Revenue (thousand HKD) | Revenue Change (%) | 2020 Sales Volume (thousand pieces) | 2019 Sales Volume (thousand pieces) | Sales Volume Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Ladies' wear | 137,548 | 201,143 | -31.6% | 2,162 | 3,286 | -34.2% | | Men's wear | 45,053 | 73,626 | -38.8% | 817 | 1,318 | -38.0% | | Children's wear | 20,287 | 27,895 | -27.3% | 361 | 516 | -30.0% | | Others | 3,444 | – | N/A | 111 | – | N/A | | Total | 206,332 | 302,664 | -31.8% | 3,451 | 5,120 | -32.6% | Average Selling Price Per Piece by Product Category (HKD) | Product category | 2020 Average Selling Price | 2019 Average Selling Price | Change (%) | | :--- | :--- | :--- | :--- | | Ladies' wear | 63.6 | 61.2 | +3.9% | | Men's wear | 55.1 | 55.9 | -1.4% | | Children's wear | 56.2 | 54.1 | +3.9% | | Others | 31.0 | – | N/A | | Total Average Selling Price Per Piece | 59.8 | 59.1 | +1.2% | - The decrease in revenue was primarily due to reduced purchasing orders from major US and Japanese customers[90](index=90&type=chunk) [Cost of Sales](index=20&type=section&id=Cost%20of%20Sales) Cost of sales decreased by **27.9%** from **HKD 249.1 million** to **HKD 179.5 million**, a reduction consistent with the decrease in revenue, primarily comprising subcontracting fees, raw materials, and consumables Cost of Sales (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Cost of sales | 179.5 | 249.1 | -27.9% | - The decrease in cost of sales was consistent with the decrease in the Group's revenue[97](index=97&type=chunk) [Gross Profit and Gross Profit Margin](index=20&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit decreased by **49.9%** to **HKD 26.8 million**, and gross profit margin fell from **17.7%** to **13.0%**, primarily due to the COVID-19 pandemic and competitive pricing offered to a major US customer Gross Profit and Gross Profit Margin (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Gross profit | 26.8 | 53.6 | -49.9% | | Gross profit margin | 13.0% | 17.7% | -4.7 percentage points | - The decline in gross profit margin was mainly due to competitive pricing offered to a major US customer[98](index=98&type=chunk) [Interest Income](index=21&type=section&id=Interest%20Income) Interest income significantly increased by **115.2%** from **HKD 0.1 million** to **HKD 0.2 million** Interest Income (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Interest income | 0.2 | 0.1 | +115.2% | [Other Income](index=21&type=section&id=Other%20Income) Other income increased to **HKD 1.0 million**, driven by a non-recurring government grant of **HKD 1.4 million** from the Hong Kong Employment Support Scheme, partially offset by reduced sample sales income and exchange losses Other Income (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Other income | 1.0 | 0.8 | +25.0% | | Government grants | 1.4 | – | N/A | | Net exchange difference (loss) gain | (0.7) | 0.3 | N/A | [Selling and Distribution Expenses](index=21&type=section&id=Selling%20and%20Distribution%20Expenses) Selling and distribution expenses decreased by **26.0%** to **HKD 13.1 million**, primarily due to reductions in sample costs, logistics expenses, and commission expenses, consistent with the decrease in revenue Selling and Distribution Expenses (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Selling and distribution expenses | 13.1 | 17.7 | -26.0% | - The decrease was primarily due to reductions in sample costs, logistics expenses, and commission expenses, consistent with the decrease in revenue[104](index=104&type=chunk) [Administrative Expenses](index=21&type=section&id=Administrative%20Expenses) Administrative expenses decreased by **12.2%** to **HKD 9.9 million**, mainly due to reductions in staff costs and benefits for administrative personnel, overseas and local travel expenses, and bank charges Administrative Expenses (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative expenses | 9.9 | 11.3 | -12.2% | - The decrease was primarily due to reductions in staff costs and benefits for administrative personnel, overseas and local travel expenses, and bank charges[105](index=105&type=chunk) [Professional Fees for Transfer of Listing](index=21&type=section&id=Professional%20Fees%20for%20Transfer%20of%20Listing) There were no non-recurring professional fees related to the transfer of listing in the current period, compared to approximately **HKD 2.4 million** recognized in the same period last year - There were no non-recurring professional fees related to the transfer of listing for the six months ended September 30, 2020[105](index=105&type=chunk) - Approximately **HKD 2.4 million** in such expenses was recognized for the six months ended September 30, 2019[105](index=105&type=chunk) [Total Comprehensive Income Attributable to Owners of the Company](index=22&type=section&id=Total%20Comprehensive%20Income%20Attributable%20to%20Owners%20of%20the%20Company) Total comprehensive income attributable to owners of the Company significantly decreased by **76.0%** to **HKD 4.5 million**, and even after adjusting for non-recurring professional fees for transfer of listing last year, the adjusted amount still decreased significantly by **78.7%** Total Comprehensive Income Attributable to Owners of the Company (For the six months ended September 30) | Indicator | 2020 (million HKD) | 2019 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Total comprehensive income | 4.5 | 18.6 | -76.0% | - Excluding the non-recurring professional fees for transfer of listing in 2019 (**HKD 2.4 million**), the adjusted total comprehensive income still significantly decreased by approximately **78.7%**[108](index=108&type=chunk) [Basic Earnings Per Share](index=22&type=section&id=Basic%20Earnings%20Per%20Share) Basic earnings per share significantly decreased by **75.7%** to **HKD 0.9 cents**, consistent with the decline in profit attributable to owners of the Company Basic Earnings Per Share (For the six months ended September 30) | Indicator | 2020 (HK cents) | 2019 (HK cents) | Change (%) | | :--- | :--- | :--- | :--- | | Basic earnings per share | 0.9 | 3.7 | -75.7% | [Interim Dividend](index=22&type=section&id=Interim%20Dividend) The Board does not recommend the payment of an interim dividend for the six months ended September 30, 2020 - The Board does not recommend the payment of an interim dividend for the six months ended September 30, 2020[110](index=110&type=chunk) [Liquidity and Financial Resources](index=22&type=section&id=Liquidity%20and%20Financial%20Resources) As of September 30, 2020, net current assets increased to **HKD 126.1 million**, but the current ratio decreased from **5.0** to **2.6**, primarily due to a significant increase in current liabilities, with the gearing ratio at zero and the unutilized banking facilities ratio at **100%** Liquidity and Financial Resources (As of September 30) | Indicator | September 30, 2020 (million HKD) | March 31, 2020 (million HKD) | | :--- | :--- | :--- | | Net current assets | 126.1 | 122.3 | | Bank and cash balances | 34.8 | 99.5 | | Current ratio | 2.6 | 5.0 | | Gearing ratio | 0 | 0 | | Unutilized banking facilities ratio | 100.0% | 100.0% | - The decrease in current ratio was primarily due to a **34.1%** increase in current assets and a significant **159.3%** increase in current liabilities, the latter mainly driven by an increase in trade and other payables[111](index=111&type=chunk) [Treasury Policy](index=23&type=section&id=Treasury%20Policy) The Group adopts a prudent treasury policy, managing credit risk through continuous credit assessment, credit limit determination, and monitoring procedures, with the Board closely monitoring cash and cash equivalents to manage liquidity risk - The Group adopts a prudent treasury policy, with credit risk primarily arising from trade and bills receivables[116](index=116&type=chunk) - Management conducts continuous credit assessments of customers and ensures appropriate measures are taken to recover overdue debts[116](index=116&type=chunk) - The Board closely monitors the level of cash and cash equivalents to manage liquidity risk[116](index=116&type=chunk) [Capital Structure](index=23&type=section&id=Capital%20Structure) For the six months ended September 30, 2020, there was no change in the Company's capital structure, with issued share capital of **HKD 5.0 million** divided into **500,000,000** ordinary shares of **HKD 0.01** each - For the six months ended September 30, 2020, there was no change in the Company's capital structure, which consists solely of ordinary shares[117](index=117&type=chunk) - The issued share capital is **HKD 5.0 million**, divided into **500,000,000** shares of **HKD 0.01** each[118](index=118&type=chunk) [Material Investments](index=23&type=section&id=Material%20Investments) As of September 30, 2020, and March 31, 2020, the Group held no material investments - As of September 30, 2020, and March 31, 2020, the Group held no material investments[120](index=120&type=chunk) [Future Plans for Material Investments and Capital Assets](index=23&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) Other than those disclosed in this report, the Group currently has no other plans for material investments and capital assets - Other than those disclosed in this report, the Group currently has no other plans for material investments and capital assets[121](index=121&type=chunk) [Material Acquisitions or Disposals of Subsidiaries and Affiliated Companies](index=23&type=section&id=Material%20Acquisitions%20or%20Disposals%20of%20Subsidiaries%20and%20Affiliated%20Companies) For the six months ended September 30, 2020, the Group did not acquire or dispose of any subsidiaries or affiliated companies - For the six months ended September 30, 2020, the Group did not acquire or dispose of any subsidiaries or affiliated companies[122](index=122&type=chunk) [Pledge of Assets](index=24&type=section&id=Pledge%20of%20Assets) As of September 30, 2020, pledged bank deposits of approximately **HKD 8.1 million** were pledged to banks to secure certain bank facilities granted to the Group Pledged Assets (thousand HKD) | Item | September 30, 2020 | March 31, 2020 | | :--- | :--- | :--- | | Pledged bank deposits | 8,121 | 8,060 | - Pledged bank deposits are used to secure certain bank facilities granted to the Group[125](index=125&type=chunk) [Contingent Liabilities and Capital Commitments](index=24&type=section&id=Contingent%20Liabilities%20and%20Capital%20Commitments) As of September 30, 2020, the Group had no material contingent liabilities or capital commitments - As of September 30, 2020, the Group had no material contingent liabilities or capital commitments[126](index=126&type=chunk) [Foreign Exchange Risk](index=24&type=section&id=Foreign%20Exchange%20Risk) The Group faces foreign currency risk, but significant changes in the USD to HKD exchange rate are not expected due to the HKD's peg to the USD; the Group currently has no foreign currency hedging policy but will monitor and consider hedging when necessary - The Group faces foreign currency risk, but significant changes in the USD to HKD exchange rate are not expected due to the HKD's peg to the USD[127](index=127&type=chunk) - The Group currently has no foreign currency hedging policy, but management will closely monitor and consider hedging when necessary[127](index=127&type=chunk) [Employees and Remuneration Policy](index=24&type=section&id=Employees%20and%20Remuneration%20Policy) As of September 30, 2020, the Group employed **61** full-time employees, with total staff costs of approximately **HKD 10.7 million**; remuneration is determined based on market terms, individual performance, and qualifications, with year-end bonuses and share options provided to attract and retain talent Number of Employees and Staff Costs (For the six months ended September 30) | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Number of full-time employees | 61 | 59 | | Total staff costs (million HKD) | 10.7 | 11.3 | - Remuneration is determined with reference to market terms and individual employees' performance, qualifications, experience, position, and caliber[128](index=128&type=chunk) - Year-end bonuses and share options are provided to attract and retain employees who contribute to the Group[128](index=128&type=chunk) [Future Prospects](index=25&type=section&id=Future%20Prospects) Due to the COVID-19 pandemic and the US-China trade dispute, the global economy is expected to further deteriorate, leading to reduced demand for the Group's products and adverse impacts on financial performance; the Group will implement cost control measures, expand manufacturer relationships outside China, and actively promote products to address these challenges - The COVID-19 pandemic is expected to lead to further deterioration of the global economy, reduced demand for the Group's products, and adverse impacts on its financial performance and position[132](index=132&type=chunk) - The ongoing US-China trade dispute may result in reduced or terminated purchasing orders from major US customers, prompting the Group to expand manufacturer relationships outside China to mitigate risks[133](index=133&type=chunk) - The Group will continue to develop promotional samples and actively promote products through showrooms, online platforms, business referrals, video conferences, and explore business diversification opportunities[134](index=134&type=chunk) [Other Information](index=26&type=section&id=Other%20Information) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company and its Associated Corporations](index=26&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures%20of%20the%20Company%20and%20its%20Associated%20Corporations) As of September 30, 2020, Mr. Chan Wing Kai, Chairman and Chief Executive Officer, held **75%** of the Company's issued share capital, or **375,000,000** shares, through his wholly-owned Speed Development Co. Ltd Directors' and Chief Executive's Interests | Name of Director | Nature of interest/Capacity | Number of ordinary shares held | Percentage of the Company's issued share capital | | :--- | :--- | :--- | :--- | | Mr. Chan | Interest in controlled corporation | 375,000,000 (L) | 75% | - Mr. Chan holds shares in the Company through Speed Development Co. Ltd., which is wholly and beneficially owned by him[140](index=140&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company](index=27&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures%20of%20the%20Company) As of September 30, 2020, Speed Development held **75%** equity in the Company, and Ms. Cheung Hung (Mr. Chan's spouse) was deemed to hold the same proportion of shares due to spousal interest Substantial Shareholders' Interests | Name of substantial shareholder | Nature of interest/Capacity | Number of ordinary shares held | Percentage of interest in the Company's issued share capital | | :--- | :--- | :--- | :--- | | Speed Development | Beneficial owner | 375,000,000 (L) | 75% | | Ms. Cheung | Spouse interest | 375,000,000 (L) | 75% | - Ms. Cheung is the spouse of Mr. Chan and is deemed under the Securities and Futures Ordinance to have an interest in the Company's shares in which Mr. Chan has an interest[146](index=146&type=chunk) [Share Option Scheme](index=28&type=section&id=Share%20Option%20Scheme) The Company adopted a share option scheme on May 31, 2017, to incentivize eligible employees and selected individuals, valid for **10 years**, but no share options have been granted since its adoption - The Company adopted a share option scheme on **May 31, 2017**, to provide incentives or rewards to eligible employees and other selected individuals[149](index=149&type=chunk) - The maximum number of shares that may be issued under the scheme shall not exceed **30%** of the Company's issued share capital from time to time[150](index=150&type=chunk) - No share options have been granted since the adoption of the scheme, which will be valid for **10 years** from its adoption date[151](index=151&type=chunk) [Directors' Interests in Competing Business](index=29&type=section&id=Directors'%20Interests%20in%20Competing%20Business) The Directors confirm that, for the six months ended September 30, 2020, no Director, controlling shareholder, substantial shareholder, or their close associates held any business or interest that competes with the Group's business - The Directors confirm that no Director, controlling shareholder, substantial shareholder of the Company, or any of their respective close associates had any business or interest that competes or may compete with the business of the Group[155](index=155&type=chunk) [Corporate Governance Practices](index=29&type=section&id=Corporate%20Governance%20Practices) The Company is committed to maintaining good corporate governance practices and has adopted the Corporate Governance Code set out in Appendix 14 of the Listing Rules; despite Mr. Chan holding both Chairman and Chief Executive Officer roles, the Board believes this benefits the Group's management and business development - The Company has adopted the code provisions of the Corporate Governance Code set out in Appendix 14 to the Listing Rules[156](index=156&type=chunk) - Mr. Chan serves as both the Chairman of the Board and the Chief Executive Officer, an arrangement the Board believes benefits the Group's management and business development[156](index=156&type=chunk) [Standard Code for Securities Transactions by Directors](index=29&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted the Standard Code as the code of conduct for Directors' securities transactions, and all Directors confirmed compliance with the code during the reporting period - The Company has adopted the Standard Code as the code of conduct for Directors' securities transactions[157](index=157&type=chunk) - All Directors confirmed that they have complied with the required standards and the code of conduct for Directors' securities transactions for the six months ended September 30, 2020[157](index=157&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=29&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) For the six months ended September 30, 2020, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the six months ended September 30, 2020, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[158](index=158&type=chunk) [Events After Reporting Period](index=30&type=section&id=Events%20After%20Reporting%20Period) The Group had no material events after September 30, 2020, that could significantly impact its operations and financial performance - The Group had no material events after September 30, 2020, that could significantly impact its operations and financial performance[161](index=161&type=chunk) [Audit Committee](index=30&type=section&id=Audit%20Committee) The Audit Committee, composed of three independent non-executive Directors, is primarily responsible for reviewing financial information, overseeing risk management and internal controls, and has reviewed this report - The Audit Committee is composed of three independent non-executive Directors, with Mr. Kwok Chi Shing as Chairman[162](index=162&type=chunk) - Its primary responsibilities include reviewing financial information, overseeing risk management and internal control systems, and it has reviewed this report[162](index=162&type=chunk) [Company Information](index=31&type=section&id=Company%20Information) [Board of Directors](index=31&type=section&id=Board%20of%20Directors) The Board of Directors comprises Executive Directors Mr. Chan Wing Kai (Chairman and Chief Executive Officer) and Mr. Ng Ming Ho, and Independent Non-executive Directors Ms. Chan Siu Lai, Mr. Kwok Chi Shing, and Mr. Ma Kwok Fai - Executive Directors include Mr. Chan Wing Kai (Chairman and Chief Executive Officer) and Mr. Ng Ming Ho[165](index=165&type=chunk) - Independent Non-executive Directors include Ms. Chan Siu Lai, Mr. Kwok Chi Shing, and Mr. Ma Kwok Fai[165](index=165&type=chunk) [Company Secretary](index=31&type=section&id=Company%20Secretary) The Company Secretary is Ms. Woo Yu Lim - The Company Secretary is Ms. Woo Yu Lim[165](index=165&type=chunk) [Compliance Officer](index=31&type=section&id=Compliance%20Officer) The Compliance Officer is Mr. Chan Wing Kai - The Compliance Officer is Mr. Chan Wing Kai[165](index=165&type=chunk) [Authorised Representatives](index=31&type=section&id=Authorised%20Representatives) The Authorised Representatives are Mr. Chan Wing Kai and Mr. Ng Ming Ho - The Authorised Representatives are Mr. Chan Wing Kai and Mr. Ng Ming Ho[165](index=165&type=chunk) [Audit Committee](index=31&type=section&id=Audit%20Committee) The Audit Committee members include Mr. Kwok Chi Shing (Chairman), Ms. Chan Siu Lai, and Mr. Ma Kwok Fai - The Audit Committee members include Mr. Kwok Chi Shing (Chairman), Ms. Chan Siu Lai, and Mr. Ma Kwok Fai[165](index=165&type=chunk) [Remuneration Committee](index=31&type=section&id=Remuneration%20Committee) The Remuneration Committee members include Ms. Chan Siu Lai (Chairperson), Mr. Kwok Chi Shing, and Mr. Ma Kwok Fai - The Remuneration Committee members include Ms. Chan Siu Lai (Chairperson), Mr. Kwok Chi Shing, and Mr. Ma Kwok Fai[166](index=166&type=chunk) [Nomination Committee](index=31&type=section&id=Nomination%20Committee) The Nomination Committee members include Mr. Ma Kwok Fai (Chairman), Ms. Chan Siu Lai, and Mr. Kwok Chi Shing - The Nomination Committee members include Mr. Ma Kwok Fai (Chairman), Ms. Chan Siu Lai, and Mr. Kwok Chi Shing[166](index=166&type=chunk) [Auditor](index=31&type=section&id=Auditor) The Auditor is ZHONGHUI ANDA CPA Limited - The Auditor is ZHONGHUI ANDA CPA Limited[166](index=166&type=chunk) [Registered Office](index=31&type=section&id=Registered%20Office) The Registered Office is located at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands - The Registered Office is located at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands[166](index=166&type=chunk) [Principal Bankers](index=31&type=section&id=Principal%20Bankers) The Principal Bankers are The Hongkong and Shanghai Banking Corporation Limited and Shanghai Commercial Bank Limited - The Principal Bankers are The Hongkong and Shanghai Banking Corporation Limited and Shanghai Commercial Bank Limited[166](index=166&type=chunk) [Company Website](index=31&type=section&id=Company%20Website) The Company Website is www.speedapparel.com.hk - The Company Website is www.speedapparel.com.hk[166](index=166&type=chunk) [Stock Code](index=31&type=section&id=Stock%20Code) The Company's Stock Code is 3860 - The Company's Stock Code is 3860[166](index=166&type=chunk)

Speed Apparel Holding Limited 尚捷集團控股有限公司 Speed Apparel Holding Limited 尚捷集團控股有限公司 (Incorporated in the Cayman Islands with limited liability) Stock Code: 3860 Annual Report 年報 2019/2020 Annual Report Speed Apparel Holding Limited 尚捷集團控股有限公司 股份代號: 3860 （於開曼群島註冊成立之有限公司） 2019/2020 2019/2020 年報 頁次 公司資料 2 主席報告 4 管理層討論與分析 6 董事及高級管理層之履歷詳情 18 企業管治報告 22 環境、社會及管治報告 36 董事會報告 44 獨立核數師報告 54 綜合損益及其他全面收益表 57 綜合財務狀況表 58 綜合權益變動表 60 綜合現金流量表 61 綜合財務報表附註 63 財務概要 102 目錄 公司資料 Section Date 公司資料 董事會 提名委員會 執行董事 陳永啟先生 （主席兼行政總裁） 吳明豪先 ...