Financial Performance - The Group's unaudited consolidated interim results for the six months ended June 30, 2022, show an improvement compared to the same period in 2021 despite the impact of the COVID-19 pandemic [10]. - The Group recorded revenue of approximately HK$3,439.8 million for the Reporting Period, representing a year-on-year increase of about 13.2% compared to HK$3,038.3 million in 1H2021 [22]. - Gross profit increased to about HK$364.6 million, up approximately 11.1% from HK$328.2 million in 1H2021, while gross profit margin slightly decreased to about 10.6% [22]. - Net profit attributable to equity shareholders rose to about HK$122.1 million, reflecting a period-on-period increase of about 25.9% from HK$97.0 million in 1H2021 [22]. - The profit for the period attributable to equity shareholders of the Company was HK$122,105,000, compared to HK$96,992,000 in 2021, reflecting a significant increase of 25.5% [159]. - Basic earnings per share increased to 29.21 HK cents from 23.40 HK cents, marking a rise of 24.0% [159]. - Total comprehensive income for the period reached HK$107,841,000, compared to HK$92,117,000 in 2021, reflecting an increase of approximately 17% [161]. Business Segments - The air freight forwarding business generated revenue of about HK$1,742.8 million, marking a significant increase of approximately 24.1% compared to HK$1,404.8 million in 1H2021 [30]. - The ocean freight segment's revenue increased by about 30.5% to approximately HK$1,035.5 million, up from HK$793.4 million in 1H2021 [32]. - The logistics services segment achieved revenue of about HK$40.0 million, an increase from HK$35.7 million in 1H2021, while gross profit decreased to about HK$11.5 million from HK$17.4 million [33]. - The Group's air freight segment accounted for about 50.7% of total revenue during the Reporting Period, up from 46.2% in 1H2021 [25]. - The ocean freight segment contributed approximately 30.1% of total revenue, increasing from 26.1% in 1H2021 [32]. - International express and parcel services represented approximately 16.2% of total revenue, down from 24.5% in the first half of 2021, with revenue decreasing by 25.2% to approximately HK$557.0 million [37][39]. Market Conditions - The pandemic-related city blockade in Shanghai affected the Group's business, but the aviation and air freight sectors helped mitigate the impact [11]. - The Group acknowledges ongoing uncertainties in the global economy and consumption due to new COVID-19 variants, particularly Omicron BA.4 and BA.5 [13]. - Global inflation is expected to further affect production and consumption, with the OECD projecting a global economic growth rate of about 3% for 2022, which is 1.5 percentage points lower than previous forecasts [17]. - The Group remains cautiously optimistic about the market and business impact of the pandemic in the second half of 2022, as travel bans and control policies are being relaxed globally [12]. - The Group anticipates that China's trade import and export will maintain a rapid growth trend in the second half of 2022 as the Pandemic is gradually controlled [20]. Operational Strategy - The Group's strategic deployment in aviation and air freight business has been beneficial in navigating the pandemic's challenges [11]. - The Group plans to enhance its agent and service network, focusing on resource sharing and capacity exchange with partners in international express and logistics services [78]. - The Group aims to strengthen its competitive advantages in international air freight by consolidating resources with its parent company and introducing wide-body all-cargo aircraft [83]. - The Group is committed to enhancing technological investment, focusing on digital transformation to improve operational efficiency and service quality [86]. - The Group plans to transform into a technology-based corporation by investing in advanced technologies like IoT, big data, and AI [90]. Financial Position - The Group's working capital as of June 30, 2022, was approximately HK$1,087.6 million, reflecting a 6.1% increase from HK$1,024.9 million as of December 31, 2021 [46][48]. - Bank balances and cash amounted to about HK$749.6 million, representing a 32.0% increase from HK$567.8 million as of December 31, 2021 [47][48]. - The Group maintained a net cash position with outstanding bank borrowings of approximately HK$1.2 million as of June 30, 2022, down from HK$5.4 million as of December 31, 2021 [47][48]. - The gearing ratio was approximately 0.1% as of June 30, 2022, compared to 0.5% as of December 31, 2021 [47][48]. - The Group's debt investment at amortized cost remained stable at approximately HK$7.1 million as of June 30, 2022, consistent with December 31, 2021 [60]. Employee and Governance - As of June 30, 2022, the Group employed approximately 894 employees, a decrease from about 962 employees as of December 31, 2021 [93]. - Employee costs, including Directors' remuneration, amounted to approximately HK$174,691,000 for the reporting period, compared to about HK$147,069,000 in the first half of 2021, reflecting an increase of approximately 18.8% [93]. - The Board has resolved not to declare an interim dividend for the reporting period, consistent with the first half of 2021 [99]. - The Company has established an audit committee to oversee financial reporting and compliance, ensuring no disagreements with management [145]. - The company has complied with the Corporate Governance Code throughout the reporting period, ensuring adherence to best practices [136].

Global Trade and Economic Outlook - In 2021, global trade volume was estimated to reach approximately US$28 trillion, a growth of 23% from 2020, driven by easing pandemic restrictions and accelerated vaccinations[11]. - The demand for international logistics rebounded significantly due to the easing of the pandemic and economic stimulus measures, contributing to the improvement in the Company's business[28]. - The Company anticipates continued growth in e-commerce driven by changes in consumption habits during the pandemic and the implementation of the Regional Comprehensive Economic Partnership (RCEP)[30]. - China's total value of goods imports and exports increased by 21.4% year on year in 2021, with exports to Latin America exceeding a growth rate of 40%[31]. - The Company expects global output to grow by 4.0% in 2022, driven by strong consumer spending and capital flows[77]. - The global economy is expected to grow by 4.0% in 2022, driven by strong consumer spending and capital inflows, despite ongoing inflationary pressures and pandemic-related challenges[79]. - The implementation of the Regional Comprehensive Economic Partnership (RCEP) is anticipated to significantly enhance trade and investment, promoting economic recovery in the Asia-Pacific region[82]. - The pandemic's impact has shifted from direct effects to potential risks, creating uncertainty in the global economic recovery process[80]. - The uneven pace of recovery between developed and developing economies may continue, affecting the sustainability of overall economic recovery[80]. Company Financial Performance - The Group recorded revenue of approximately HK$7,556.4 million during FY2021, representing an increase of about 49.7% from FY2020[32]. - Gross profit amounted to about HK$792.8 million during FY2021, reflecting an increase of approximately 2.6% from FY2020, with a gross profit margin of about 10.5%[32]. - Net profit was approximately HK$278.2 million during FY2021, an increase of about 8.7% from FY2020, while net profit attributable to equity shareholders increased by about 8.4% to approximately HK$273.4 million[32]. - The Group's distributable reserve as of December 31, 2021, amounted to HK$438,834,000, compared to HK$427,427,000 in 2020, reflecting a growth of approximately 3.3%[187]. - The Group recommended a final dividend of HK6.5 cents per share for FY2021, totaling approximately HK$27,312,000, compared to HK$25,422,000 in FY2020[151]. - The Group's financial results for FY2021 are detailed in the consolidated statement of profit or loss on page 96 of the annual report[151]. Logistics and Service Development - The company adopted a pragmatic and aggressive approach to leverage its service capabilities and provide high-quality international logistics and supply chain services globally[13]. - The Company plans to strengthen investment in logistics infrastructure, particularly in aviation resources and international supply chain service capabilities, as part of its five-year strategic plan[20]. - The Company aims to enhance its service quality and competitive advantages while expanding its product portfolio to explore regional market potential[21]. - The Company aims to enhance cross-selling opportunities through its comprehensive range of logistics services, including air and ocean freight forwarding, warehousing, and customs clearance[37]. - The Company is focusing on cross-border e-commerce as a key strategic growth point, leveraging its resources to develop dedicated air freight solutions for major markets like Europe, the United States, and Southeast Asia[102][103]. Operational Challenges and Market Conditions - The prolonged pandemic affected the international logistics industry, leading to significant challenges such as reduced flights and blocked ports, while international logistics prices remained high[12]. - The ongoing impact of the COVID-19 pandemic is expected to continue affecting global supply chains, maintaining strong reliance on Chinese manufacturing for global economies[34]. - The shortage of international air cargo capacity is expected to persist in the short term, necessitating the enhancement of the company's own air freight resources[87]. - The new wave of COVID-19 outbreaks, particularly from the Omicron variant, poses new challenges and potential economic losses[78]. Corporate Governance and Leadership - The company has a strong board with diverse backgrounds in management and finance, enhancing governance and strategic direction[119]. - The company has been focusing on enhancing its financial management capabilities, as evidenced by Mr. Chen's role in overseeing financial management since June 2020[121]. - The board includes members with extensive experience in multinational companies, which may benefit the company's international operations[121]. - The management team is well-versed in both domestic and international markets, positioning the company for future growth[129]. Employee and Stakeholder Engagement - The Group emphasizes environmental protection and implements green office practices to minimize its impact on the environment[162]. - The Group's success relies on support from key stakeholders, including employees, customers, vendors, and shareholders[163]. - The Group has implemented a sound performance appraisal system to reward high-performing staff and promote career development[168]. - The Group has adopted a share option scheme and a share award plan to incentivize employees contributing to the Group's success[186].

Financial Performance - During the Reporting Period, the Group experienced a significant recovery in demand for logistics and freight forwarding services, leading to a substantial increase in revenue[16]. - The Group's net profit slightly increased compared to the corresponding period in 2020, despite a drop in gross profit due to increased air freight forwarding costs[16]. - The Group recorded a revenue of approximately HK$3,038.3 million for the Reporting Period, representing a year-on-year increase of about 38.0% compared to HK$2,201.3 million in 1H2020[25]. - Gross profit decreased to about HK$328.2 million, down approximately 11.8% from HK$372.0 million in 1H2020, resulting in a gross profit margin of about 10.8%[25]. - Net profit attributable to equity shareholders increased slightly to about HK$97.0 million, reflecting a period-on-period increase of about 1.6% from HK$95.5 million in 1H2020[25]. - The profit for the period was HK$96,992,000, contributing to retained profits of HK$780,439,000 as of June 30, 2021[161]. - Total comprehensive income for the period was HK$92,117,000, slightly up from HK$91,624,000, indicating a year-over-year increase of 0.5%[154]. - Profit before taxation for the six months ended June 30, 2021, was HK$117,185, a slight decrease of 0.22% compared to HK$117,440 in 2020[166]. Market Trends and Economic Outlook - Global trade showed a year-on-year growth of 10% and a quarter-on-quarter growth of 4% in Q1 2021, with an overall forecast indicating a 16% increase in global trade for the year[17]. - It is estimated that global trade in goods and services will reach US$6.6 trillion in Q2 2021, representing a year-on-year increase of about 31% compared to the lowest point in 2020[17]. - The emergence of the Delta variant poses uncertainty for the resumption of economic activities, although the global vaccination rate has exceeded 3 billion[18]. - The Group maintains a cautiously optimistic forecast for economic development and business expansion in the second half of the year[18]. - The overall demand recovery is attributed to the easing of COVID-19 pandemic restrictions and a rebound in global trade activities[19]. - The Group's performance reflects broader trends in the logistics sector as it adapts to changing market conditions post-pandemic[19]. Segment Performance - The air freight forwarding segment contributed about 46.2% of the Group's total revenue, with revenue of approximately HK$1,404.8 million, a slight decrease of about 0.4% from HK$1,410.3 million in 1H2020[36]. - The gross profit for the air freight segment fell by about 45.3% to approximately HK$114.8 million, down from HK$209.8 million in the corresponding period of 2020[36]. - The ocean freight segment saw a significant revenue increase of about 143.1%, reaching approximately HK$793.4 million compared to HK$326.4 million in 1H2020, contributing about 26.1% to total revenue[36]. - Gross profit for the ocean freight segment increased to about HK$96.4 million, up from HK$68.2 million in 1H2020, driven by rising demand due to global trade recovery[36]. - The international express and parcel services segment represented about 24.5% of total revenue, with revenue increasing from approximately HK$320.2 million in 1H2020 to about HK$744.3 million, a significant increase of about 132.4%[41][42]. - The gross profit for international express and parcel services rose to approximately HK$82.2 million, up about 83.9% from HK$44.7 million in 1H2020[42][44]. - The logistics services segment accounted for approximately 1.2% of the Group's total revenue during the Reporting Period, generating revenue of about HK$35.7 million, down from HK$42.1 million in 1H2020[38][39]. Financial Position and Cash Flow - The Group's working capital as of June 30, 2021, was about HK$830.4 million, reflecting a 10.6% increase from HK$750.5 million as of December 31, 2020[47][50]. - The current ratio slightly increased from about 2.10 times as of December 31, 2020, to about 2.11 times as of June 30, 2021[47][50]. - As of June 30, 2021, the Group's bank balances and cash amounted to about HK$454.7 million, a decrease of about 7.6% from HK$491.9 million as of December 31, 2020[48][50]. - The Group had an operating cash outflow of about HK$8.3 million during the Reporting Period, compared to an operating cash inflow of about HK$127.9 million in 1H2020[48][50]. - The gearing ratio of the Group was about 0.1% as of June 30, 2021, unchanged from December 31, 2020, indicating a maintained net cash position[48][50]. - Current assets rose to HK$1,581,666,000, compared to HK$1,435,933,000 at the end of 2020, reflecting an increase of 10.2%[156]. - Net current assets improved to HK$830,406,000, up from HK$750,535,000, marking an increase of 10.6%[158]. - Total cash and cash equivalents at the end of the period stood at HK$454,712, compared to HK$374,218 at the end of the previous year, representing an increase of 21.5%[168]. Strategic Initiatives and Future Plans - The company plans to focus on expanding its small parcels business to Southeast Asia in the second half of 2021[68]. - The company aims to strengthen its agency network and enhance strategic partnerships to support business growth[72]. - The company will utilize aviation resources from YTO Express Group to improve trunk line capacity and provide competitive international air freight services[73]. - The company expects to achieve breakthroughs in South America and Africa, expanding its service network and business scope[74]. - The Company plans to invest in infrastructure in key countries starting in the second half of 2021, leveraging the opportunities from the Regional Comprehensive Economic Partnership (RECP) to enhance regional service capabilities[75]. - The Company aims to expand its cross-border e-commerce and small parcel services in Southeast Asia, transitioning from a China-centered model to a regional inter-networking model[77]. - The Company will enhance its freight forwarding business by increasing cooperation between East Asia and North America/Europe, capitalizing on the growth opportunities in East Asia[76]. - The Company is focusing on the globalization demands of Chinese enterprises, aiming to provide high-quality logistics and supply chain services to support their international development[79]. - A new generation business system is expected to be completed within the year, which will improve business digitalization and enhance operational efficiency[80]. Corporate Governance and Compliance - The company has not declared an interim dividend for the reporting period, consistent with the previous year[89]. - The company has maintained compliance with the Securities and Futures Ordinance regarding the recording of interests in shares[107]. - The company adopted a Share Option Scheme on June 21, 2014, but no share options were outstanding, granted, exercised, lapsed, or cancelled during the reporting period[108]. - The Share Award Plan aims to attract suitable personnel for further development of the group[112]. - The company has complied with the Corporate Governance Code throughout the reporting period, ensuring adherence to best practices in governance[127][130]. - The audit committee, comprising one non-executive director and two independent non-executive directors, reviewed the unaudited consolidated financial statements with no disagreements noted[137]. Shareholding and Ownership - Mr. Yu Huijiao holds 268,229,408 shares, representing approximately 64.36% of the company's shareholding[93]. - Mr. Huang Yifeng holds 3,717,600 shares, representing approximately 0.89% of the company's shareholding[93]. - Mr. Sun Jian holds 4,017,600 shares, representing approximately 0.96% of the company's shareholding[93]. - Mr. Li Xianjun holds 3,334,100 shares, representing approximately 0.80% of the company's shareholding[93]. - Mr. Chen Dong holds 1,600,000 shares, representing approximately 0.38% of the company's shareholding[93]. - YTO Express holds 1,082,712,613 shares, representing approximately 34.26% of the registered capital[99]. - YTO Global Holdings Limited holds 1,600,000,000 shares, representing 100.00% of the registered capital[99]. - As of June 30, 2021, no other directors or chief executives had interests in the shares or debentures of the company[101].

Economic Impact - The global economy is forecasted to contract by 4.4% in 2020 due to the COVID-19 pandemic, impacting various sectors including logistics and commerce[13] - In FY2020, the global economy faced a contraction of 4.4% due to COVID-19, but the company experienced significant growth in air freight, with both cargo volume and revenue increasing substantially[17] - The World Bank predicts a global output recovery of 4% in 2021, although this is lower than pre-pandemic forecasts, reflecting ongoing challenges from COVID-19[92] Company Performance - The company achieved historic breakthroughs in many financial indicators during 2020, reflecting strong market performance[14] - The Group recorded revenue of approximately HK$5,048.1 million for FY2020, representing an increase of about 29.5% compared to FY2019[38] - Gross profit for FY2020 amounted to approximately HK$772.6 million, reflecting a growth of about 40.2% from FY2019[38] - Net profit surged to approximately HK$255.9 million in FY2020, marking an increase of about 794.8% year-on-year[38] - The net profit attributable to equity shareholders increased by about 866.3% to approximately HK$252.2 million in FY2020[38] Air Freight Segment - Despite the pandemic, the air freight segment, the largest business area for the company, experienced substantial growth in both cargo volume and revenue[14] - The air freight forwarding business generated revenue of about HK$3,062.5 million in FY2020, an increase of about 39.1% from FY2019[43] - The gross profit for the air freight segment rose by approximately 90.8% to about HK$455.2 million in FY2020[43] - The air freight forwarding segment constituted about 60.7% of the Group's total revenue in FY2020, up from 56.5% in FY2019[42] Strategic Initiatives - Looking ahead, the company is initiating a new five-year strategic plan focused on international development and globalization strategies[16] - The company plans to enhance investments in global network construction, logistics infrastructure, information systems, and talent reserves[16] - The company aims to leverage the opportunities presented by the signing of key international trade agreements, such as the China-EU Comprehensive Agreement on Investment and RCEP, to stimulate trade development[22] - The company plans to enhance its internationalization strategy by investing in global network construction, logistics infrastructure, and information systems[18] Healthcare Demand - The demand for healthcare and medical supplies contributed significantly to the company's revenue, leading to a substantial increase in net profit during FY2020[28] - The company recognizes the ongoing demand for pandemic prevention supplies, which is expected to continue into 2021[28] - The increase in net profit for the first half of 2020 was primarily driven by heightened demand for healthcare and medical supplies due to the COVID-19 pandemic[38] Market Trends - The pandemic has accelerated consumer behavior towards e-commerce, which is expected to further promote the company's expansion in international express and parcel services[31] - In 2020, global retail e-commerce sales were expected to increase by 27.6%, indicating a significant shift towards e-commerce due to changing consumer habits[99] - The global cross-border B2C e-commerce transaction volume was predicted to reach $994 billion in 2020, benefiting 943 million global consumers, with the Asia-Pacific region contributing 53.6% to the increase[99] Financial Health - The Group's working capital as of December 31, 2020, was approximately HK$750.5 million, representing a significant increase of about 58.7% from HK$473.0 million as of December 31, 2019[64] - The current ratio improved from about 1.90 times as of December 31, 2019, to about 2.10 times as of December 31, 2020[64] - The Group's bank balances and cash amounted to approximately HK$491.9 million as of December 31, 2020, an increase of about 82.9% from HK$269.0 million as of December 31, 2019[64] Future Outlook - The company maintains a prudent and optimistic outlook for 2021, anticipating a gradual weakening of the pandemic's impact due to vaccination progress[28] - The company anticipates that global vaccination efforts will require over 10 billion doses, necessitating approximately 200,000 pallet shipments, 15 million cold container shipments, and 15,000 full flights of Boeing 747 freighter aircraft[30] - The Group maintains a prudent and optimistic outlook for 2021, driven by the recovery of China's manufacturing and consumption, which is expected to stimulate market demand for cross-border supply chains[93] Leadership and Governance - The company has a strong leadership team with diverse backgrounds in finance and management, enhancing its strategic decision-making capabilities[140] - The management team emphasizes the importance of compliance and governance in maintaining investor confidence and operational integrity[145] - The company emphasizes strong governance with independent directors overseeing key committees, ensuring compliance and strategic direction[151] Dividend Policy - The board of directors has approved a dividend payout of $0.10 per share, reflecting a commitment to shareholder returns[134] - The Company has adopted a dividend policy that considers financial results, cash flow, business conditions, future operations, capital requirements, and shareholder interests when declaring dividends[178] Environmental Commitment - The Group emphasizes environmental protection and implements green office practices to minimize its impact on the natural environment[187]

Financial Performance - The company reported revenue of approximately HKD 2,201.3 million for the six months ended June 30, 2020, representing a 22.3% increase compared to HKD 1,800.1 million in the same period of 2019[10]. - Gross profit increased by approximately 45.2% to about HKD 372.0 million, up from HKD 256.2 million in the first half of 2019[10]. - Net profit attributable to the company's owners surged to approximately HKD 95.5 million, a significant increase of about 1,756.0% compared to HKD 5.1 million in the same period last year[10]. - The gross margin improved to approximately 16.9%, compared to 14.2% in the first half of 2019, due to stricter cost control measures[10]. - Basic earnings per share for the period was HKD 23.03, compared to HKD 1.25 in the previous year, marking a substantial increase[92]. - Profit before tax for the six months was HKD 117,440,000, significantly higher than HKD 8,754,000 in the same period last year[138]. - The effective tax expense for the period was HKD 20,835,000, compared to HKD 2,312,000 in the previous year[131]. Revenue Breakdown - Air freight forwarding business accounted for approximately 64.1% of total revenue, with revenue of about HKD 1,410.3 million, a 33.7% increase from HKD 1,054.5 million in the same period last year[13]. - Sea freight forwarding contributed about 14.8% to total revenue, with revenue decreasing by approximately 14.1% to about HKD 326.4 million, down from HKD 379.8 million in the same period last year[14]. - International express and parcel services revenue grew by approximately 16.7% to about HKD 320.2 million, up from HKD 274.4 million in the same period last year[19]. - Revenue from the China region was HKD 1,586,813,000, up 30.3% from HKD 1,216,778,000 in the previous year[128]. - The logistics segment reported revenue of HKD 42,134,000, a 21.0% increase from HKD 34,800,000 year-on-year[126]. Operational Challenges - The company is facing uncertainties in global economic recovery, particularly in major economies like the US, which may affect demand for logistics services[6]. - The overall demand for logistics and freight forwarding services has declined due to the COVID-19 outbreak, although there has been an increase in demand for health-related products[5]. - The company anticipates higher costs due to reduced international flights, which may impact gross profit margins[8]. Strategic Initiatives - The company plans to collaborate with its subsidiary, YTO Airlines, to develop more routes and offer competitive pricing and quality services to customers[8]. - The establishment of a subsidiary in Vietnam aims to serve cross-border e-commerce, indicating the company's market expansion strategy[8]. - The group plans to enhance international service capabilities, particularly in Southeast Asia, leveraging its experience and resources[48]. - The group aims to strengthen its overseas agency network and collaborate with Chinese overseas enterprises to expand its business footprint[51]. - The company is committed to establishing an e-commerce platform to assist SMEs in exporting products to China, integrating full-link and customs clearance services[52]. Cash Flow and Financial Position - Operating cash inflow for the period was approximately HKD 127.9 million, down from HKD 198.7 million in the same period last year[22]. - As of June 30, 2020, the group's operating capital was approximately HKD 576.5 million, an increase of about 21.9% from HKD 473.0 million at the end of 2019[22]. - The group's bank balance and cash amounted to approximately HKD 374.2 million, a 39.1% increase from HKD 269.0 million at the end of 2019[22]. - The company reported a significant increase in cash and cash equivalents net increase of HKD 107,506 thousand for the six months ended June 30, 2020, compared to HKD 25,205 thousand in the same period of 2019[110]. - The net cash inflow from operating activities for the six months ended June 30, 2020, was HKD 123,406 thousand, compared to HKD 127,947 thousand in the same period of 2019, reflecting a decrease of approximately 3.9%[108]. Shareholder Information - As of June 30, 2020, key shareholders include Yu Huijiao with a 64.36% stake and Lin Jinzhan with a 6.42% stake in the company[61]. - Major shareholders include YTO International Holdings Limited with 268,229,408 shares, representing 64.36% of the issued share capital[68]. - Lin Investment Company holds 26,744,000 shares, accounting for 6.42% of the issued share capital[68]. Corporate Governance - The board has adopted the corporate governance code as per the listing rules and has complied with its provisions during the reporting period[76]. - The audit committee, consisting of one non-executive director and two independent non-executive directors, reviewed the unaudited consolidated financial statements without any disagreements[80]. Acquisitions and Investments - The acquisition of YTO Express (Hong Kong) was completed for HKD 6,940,000, with identifiable net assets valued at HKD 7,613,000[181]. - The company recognized a COVID-19 related rent concession amounting to HKD 656,000 during the six months ended June 30, 2020[148]. - The company has made significant investments in lease liabilities, which increased to HKD 106,727 thousand from HKD 23,557 thousand, indicating a strategic shift towards leasing[99].

Financial Performance - The group recorded revenue of approximately HKD 3,897.9 million for the fiscal year 2019, a decrease of about 12.7% compared to HKD 4,462.8 million in 2018[14]. - Gross profit for the fiscal year 2019 decreased by approximately 7.4% to about HKD 550.9 million, with a gross margin of approximately 14.1%[14]. - Net profit decreased by approximately 72.9% to about HKD 28.6 million in 2019, down from HKD 105.7 million in 2018, primarily due to the trade war between China and the US and increased employee costs[14]. - Air freight revenue decreased by approximately 29.6% to about HKD 2,201.9 million in 2019, with gross profit dropping by approximately 26.7% to HKD 238.6 million[17]. - Sea freight revenue contributed approximately 21.9% to total revenue in 2019, with a slight decrease of about 0.2% to HKD 855.3 million[19]. - The logistics services segment recorded revenue of approximately HKD 81.6 million in 2019, an increase of about 6.3% from HKD 76.8 million in 2018[20]. - Other businesses generated revenue of approximately HKD 116.8 million in the fiscal year 2019, a decrease of about 0.7% compared to HKD 117.7 million in 2018, with gross profit declining by approximately 25.5% to HKD 20.4 million[24]. - The proposed final dividend for the fiscal year 2019 is HKD 0.01 per ordinary share, totaling approximately HKD 4,168,000, a decrease from HKD 15,742,000 in 2018[66]. Growth and Market Strategy - In 2019, the international express and parcel services contributed approximately 16.5% to the total revenue of the group, with revenue increasing from about HKD 282.1 million in 2018 to approximately HKD 642.3 million in 2019, representing a significant growth of about 127.7%[8]. - The cross-border e-commerce business maintained rapid growth, with the total retail import and export value through customs reaching RMB 186.2 billion, a year-on-year increase of 38%[8]. - The group anticipates that international express and parcel services will become its most competitive product and a key source of growth moving forward[8]. - The group aims to become a leading integrated logistics service provider globally, aligning with cross-border e-commerce trends[9]. - The company plans to enhance its international express business by improving global service capabilities and expanding coverage, particularly in Southeast Asia, which is identified as a rapidly growing e-commerce market[40]. - The company plans to invest more in the Southeast Asian e-commerce market based on successful experiences in mainland China and Taiwan[40]. - The company intends to strengthen its overseas agency network and collaborate with Chinese overseas enterprises to expand its business in previously untapped regions[43]. Challenges and Risks - Despite the negative impacts of COVID-19 on global trade and supply chains, the group remains optimistic about future business prospects[9]. - The demand for logistics and freight forwarding services saw a decline in 2019 due to the trade war between China and the United States and global economic uncertainties[13]. - The COVID-19 pandemic negatively impacted the group's logistics operations due to worsened global trade conditions, prompting the company to take necessary measures to minimize the impact[157]. - The group plans to terminate the Xian Da Thailand and Xian Da Vietnam agreements if permitted by relevant laws to reduce associated risks[135]. Financial Position and Capital Management - As of December 31, 2019, the group's operating capital was approximately HKD 473.0 million, a slight decrease of about 0.7% from HKD 476.4 million in 2018, while the current ratio increased from 1.71 times to 1.90 times[25]. - The group's cash and bank balances increased by approximately 11.8% to HKD 269.0 million as of December 31, 2019, compared to HKD 240.7 million in 2018[25]. - Operating cash inflow for the fiscal year 2019 was approximately HKD 239.5 million, significantly up from HKD 63.9 million in the fiscal year 2018[25]. - The group's debt-to-equity ratio improved to approximately 5.1% as of December 31, 2019, down from 32.5% in 2018, maintaining a net cash position[25]. - The company has no significant contingent liabilities as of December 31, 2019, and is not involved in any major legal proceedings[147]. Corporate Governance and Management - The board of directors has implemented appropriate corporate governance policies and practices in line with the Stock Exchange's corporate governance code[161]. - The company has maintained compliance with listing rules regarding the appointment of at least three independent non-executive directors, ensuring a balanced board composition[167]. - The roles of the chairman and CEO are held by different individuals to ensure a balance of power and independent judgment[170]. - The board consists of executive directors, including Mr. Lin Jin Zhan as CEO and Mr. Huang Yi Feng as President, along with independent non-executive directors who provide diverse expertise[164]. - The company has adopted a board diversity policy with measurable targets, including at least 40% of board members being under 50 years old and at least 50% holding a master's degree[194]. - The company is committed to ongoing training and development for its directors to enhance their effectiveness[178]. Related Party Transactions - The group has established ongoing related party transactions with YTO Freight, which is a wholly-owned subsidiary of YTO Express[124]. - The group’s major related party transactions are disclosed in the consolidated financial statements, with no transactions requiring independent shareholder approval[119]. - The group received approximately HKD 5.7 million from YTO Express for international express and parcel services in the fiscal year 2019[122]. - The ongoing related party transactions include a total service agreement with YTO Express, effective from January 1, 2019, to December 31, 2021[120]. Employee and Shareholder Relations - The company maintains good relationships with key stakeholders, including employees, customers, suppliers, and shareholders, to enhance business success[72]. - The group employed approximately 1,070 employees as of December 31, 2019, down from 1,130 employees in 2018[84]. - The company participates in a defined contribution retirement benefit plan organized by local government agencies for eligible employees in China[114]. - Major shareholders include Lin Investment Company with 39,722,000 shares (9.53%) and YTO International Holdings with 268,229,408 shares (64.36%)[115][117].

Financial Performance - The company reported revenue of approximately HKD 1,800.1 million for the six months ended June 30, 2019, a decrease of about 7.6% compared to HKD 1,948.5 million in the same period of 2018[7]. - Gross profit decreased by approximately 6.1% to about HKD 256.2 million, with a slight increase in gross margin to approximately 14.2% from 14.0% in the previous year[7]. - Net profit attributable to owners significantly dropped to approximately HKD 5.1 million, down about 86.5% from HKD 38.0 million in the same period of 2018[7]. - Basic earnings per share decreased to HKD 1.25 from HKD 9.18, representing a decline of 86.4%[72]. - The total comprehensive income for the period was HKD 2,270 thousand, down from HKD 28,085 thousand in the previous year, a decrease of 91.9%[74]. - The group reported a profit of HKD 5,143,000 for the six months ended June 30, 2019, significantly down from HKD 38,024,000 in the same period of 2018[176]. Revenue Segmentation - The air freight segment accounted for approximately 58.6% of total revenue, down from 71.1% in the previous year, with revenue of about HKD 1,054.5 million, a decrease of approximately 23.9%[10]. - The sea freight segment contributed about 21.1% to total revenue, with revenue decreasing by approximately 3.4% to about HKD 379.8 million[11]. - The logistics and contract logistics services segment accounted for approximately 1.9% of total revenue, with revenue of about HKD 34.8 million, down from HKD 42.2 million in the same period of 2018[13]. - International express and parcel services accounted for approximately 15.2% of total revenue, up from 3.7% in the first half of 2018[14]. - Revenue from international express and parcel services increased from approximately HKD 72.7 million in the same period of 2018 to approximately HKD 274.4 million, representing a growth rate of about 277.3%[15]. Operational Adjustments - The decline in demand for logistics and freight forwarding services was attributed to the trade war between China and the United States and global economic uncertainties[6]. - The company has been actively adjusting its warehouse operations and enhancing its transshipment capabilities in response to market conditions[13]. - The company aims to leverage its established reputation in the logistics industry to capture growth opportunities in the sea freight market[11]. - The company plans to enhance its international supply chain service capabilities in specialized areas such as pharmaceuticals, clothing, electronics, and food[40]. - The company aims to develop e-commerce logistics capabilities for both B2B and B2C markets, leveraging its domestic network across China[39]. Financial Position - The current ratio improved from approximately 1.71 times as of December 31, 2018, to approximately 1.80 times as of June 30, 2019[19]. - Cash and bank balances increased by approximately 9.4% to about HKD 263.2 million as of June 30, 2019, compared to HKD 240.7 million as of December 31, 2018[19]. - The group maintained a net cash position with a debt-to-equity ratio of approximately 11.2% as of June 30, 2019, down from 32.5% as of December 31, 2018[19]. - The company reported a net cash increase of HKD 25,205,000 for the six months ended June 30, 2019, compared to HKD 385,000 in the same period of 2018[89]. - The operating cash flow before tax profit was HKD 207,611,000, a significant increase from HKD 47,519,000 year-on-year[89]. Shareholder Information - The board has decided not to declare an interim dividend for the reporting period[45]. - Mr. Lin Jin Zhan holds 40,224,000 shares, representing 9.71% of the company's ordinary shares[45]. - Mr. Yu Hui Jiao holds 268,229,408 shares, representing 64.75% of the company's ordinary shares[45]. - The major shareholder, YTO International Holdings, holds over 50% of the company's issued share capital[48]. - The company has adopted stock option and share award plans to incentivize and reward eligible participants[42]. Compliance and Governance - The board has adopted the corporate governance code as per the listing rules and has complied with the code provisions during the reporting period[61]. - The audit committee, consisting of one non-executive director and two independent non-executive directors, reviewed the unaudited consolidated financial statements for the reporting period[65]. - The company has confirmed compliance with the standards for securities trading by all directors during the reporting period[62]. - The company reported no significant changes in the board of directors, with the resignation of the president effective April 17, 2019[63]. Accounting Standards - The company adopted the new and revised Hong Kong Financial Reporting Standards (HKFRS) effective from January 1, 2019, which did not have a significant impact on the financial position and performance for the current and prior periods[94]. - The company applied HKFRS 16 "Leases" for the first time during the interim period, replacing HKAS 17 "Leases" and related interpretations[96]. - The application of HKFRS 16 resulted in significant changes in accounting policies related to leases, impacting the financial statements[97]. - The company has consistently applied accounting policies and calculation methods in the interim financial statements as in the annual financial statements for the previous year, except for changes due to the adoption of new and revised HKFRS[93]. Market Conditions - The company will continue to explore opportunities in emerging markets, particularly in Southeast Asia and the Middle East, to expand its express delivery services[41]. - The company has achieved a significant increase in demand for cross-border e-commerce logistics, despite challenges from US-China trade tensions[36]. - The company will enhance its global network layout and integrated supply chain service capacity[36]. - The company will continue to seek synergies with its parent company post-acquisition to improve operational efficiency[36].

Financial Performance - In the fiscal year 2018, the group recorded revenue of approximately HKD 4,462.8 million, an increase of about 21.6% compared to HKD 3,670.5 million in 2017[12] - The gross profit for fiscal year 2018 rose approximately 4.1% to about HKD 595.0 million, with a gross margin of approximately 13.3%, down from 15.6% in 2017[12] - Net profit increased by approximately 4.7% to about HKD 105.7 million, while profit attributable to owners rose by approximately 6.8% to about HKD 104.2 million[12] - Air freight revenue for the fiscal year 2018 reached approximately HKD 3,129.3 million, an increase of about 27.3% compared to HKD 2,458.1 million in 2017[15] - The air freight segment accounted for approximately 70.1% of total revenue in fiscal year 2018, up from 67.0% in 2017[14] - Sea freight revenue decreased by approximately 7.2% to about HKD 857.0 million in fiscal year 2018, down from HKD 923.6 million in 2017[17] - The logistics and contract services segment generated revenue of approximately HKD 76.8 million in fiscal year 2018, a decrease of about 14.1% from HKD 89.4 million in 2017[18] - Other businesses recorded revenue of approximately HKD 117.7 million in fiscal year 2018, an increase of about 22.6% from HKD 96.0 million in 2017[22] Business Segments - The international express business achieved significant breakthroughs, benefiting from the rapid growth of cross-border e-commerce, which saw a total retail import and export value of RMB 134.7 billion, a year-on-year increase of 50%[6] - The international express and parcel service revenue surged to approximately HKD 282.1 million in fiscal year 2018, representing a growth rate of about 172.7% from HKD 103.5 million in 2017[20] - The international express and parcel service completed a total of 39.6 million shipments in fiscal year 2018, compared to 14.2 million shipments in 2017[20] - The international express and parcel service segment contributed approximately HKD 25.4 million in profit for the group, marking an increase of about HKD 23.2 million in profit contribution[12] - The gross profit for the air freight segment increased by about 10.2% to approximately HKD 325.7 million in fiscal year 2018, up from HKD 295.6 million in 2017[15] - The gross profit for the international express and parcel service rose to approximately HKD 25.9 million in fiscal year 2018, compared to HKD 3.6 million in 2017[20] - The sea freight segment's gross profit decreased by approximately 10.6% to about HKD 172.0 million in fiscal year 2018, down from HKD 192.3 million in 2017[17] Strategic Initiatives - The company plans to enhance its logistics routes in countries along the Belt and Road Initiative, particularly in emerging markets like Southeast Asia[7] - The group aims to integrate its quality customer resources to support Chinese manufacturing going global, enhancing competitiveness in international logistics services[7] - The company is focusing on three development strategies: "Express + Freight Forwarding," "Internet + Freight Forwarding," and "Supply Chain + Freight Forwarding" to upgrade its business and brand[8] - The company is increasing its investment in information technology to promote the internet-based upgrade of freight forwarding services, aiming to provide a more convenient international logistics service experience[8] - The company plans to enhance its international express and parcel business performance, focusing on Southeast Asia and leveraging e-commerce platforms[39] - The company aims to deepen its supply chain management capabilities, particularly in sectors like aviation materials, pharmaceuticals, and automotive[42] - The company will continue to invest in IT systems to achieve seamless integration of various operational systems[43] - The company anticipates that international express and parcel services will be a significant driver of future business growth due to rising demand[38] Financial Position - As of December 31, 2018, the group's operating capital was approximately HKD 476.4 million, an increase of about 9.6% from HKD 434.5 million on December 31, 2017[23] - The current ratio improved from approximately 1.65 times on December 31, 2017, to approximately 1.71 times on December 31, 2018[23] - The group's cash and bank balances were approximately HKD 240.7 million as of December 31, 2018, a decrease of about 3.0% from HKD 248.2 million on December 31, 2017[23] - Operating cash inflow for the fiscal year 2018 was approximately HKD 63.9 million, compared to an outflow of approximately HKD 32.2 million in the fiscal year 2017[23] - As of December 31, 2018, the group's outstanding bank borrowings were approximately HKD 189.0 million, up from approximately HKD 179.8 million on December 31, 2017[23] - The group's debt-to-equity ratio was approximately 32.5% as of December 31, 2018, unchanged from December 31, 2017[23] - The group maintained a net cash position as of December 31, 2018, consistent with the previous year[23] Corporate Governance - The board of directors includes key positions such as Chairman and CEO Yu Huijiao and Vice Presidents Li Xianjun, Su Xiufeng, Zhu Rui, and Lin Kai[161] - The board composition complies with listing rules, having at least three independent non-executive directors, representing one-third of the board[183] - The executive director Lin Jin Zhan has a service contract with a term of three years, while the independent non-executive directors are appointed for one-year terms[186] - All directors received formal training upon their appointment to understand the company's business and regulatory responsibilities[189] - The board members possess skills and experience relevant to the company's business needs and objectives, ensuring effective governance[183] - The chairman and CEO roles are held by different individuals to maintain a balance of power and perspective[185] - Independent non-executive directors play a crucial role in providing independent judgment and oversight, particularly in matters involving potential conflicts of interest[183] - The company has received annual written confirmations of independence from all independent non-executive directors[184] - The board regularly reviews the delegated authority and responsibilities of the executive committee and senior management[180] - The board committees have the authority to seek independent professional advice when necessary, with costs covered by the company[195] Shareholder Information - The company proposed a final dividend of HKD 0.038 per share for the fiscal year 2018, totaling approximately HKD 15,742,000, compared to HKD 9,528,000 in 2017[66] - The company has adopted a dividend policy that considers financial performance, cash flow, business conditions, and future growth when declaring dividends[67] - The total number of shares held by major shareholders represents a significant portion of the company's issued share capital[122] - Major shareholders include Lin's Investment Company with 40,224,000 shares (9.71%) and YTO International Holdings Limited with 268,229,408 shares (64.75%) as of December 31, 2018[119] - The company plans to issue up to 1,900,000 new shares under its share incentive plan, which was approved by shareholders[173] Management and Employees - The group employed approximately 1,130 employees as of December 31, 2018, an increase from 1,060 employees as of December 31, 2017[83] - The company participates in a defined contribution retirement benefit plan for eligible employees in China and a mandatory provident fund scheme for employees in Hong Kong[117] - The company has adopted stock option and share incentive plans to motivate and reward eligible participants for their contributions[83] - The salary range for senior management in the fiscal year was between HKD 500,000 to HKD 3,499,999, with a total of 6 individuals in various salary brackets[199] Compliance and Risk Management - The group has established compliance and risk management policies to monitor adherence to significant legal and regulatory requirements[76] - The group confirmed compliance with HKEx guidelines regarding the pricing and terms of the management and agency agreements during the fiscal year 2018[143] - Independent non-executive directors have reviewed the management agreements and confirmed that transactions were conducted in the ordinary course of business and on normal commercial terms[156] - The group has engaged Deloitte to report on non-exempt continuing connected transactions for the fiscal year 2018, confirming compliance with relevant regulations[154] Corporate Social Responsibility - Total charitable donations made by the group in the fiscal year 2018 amounted to approximately HKD 136,000, an increase from HKD 126,000 in 2017[172] - The group has implemented green office initiatives to reduce energy consumption and promote recycling[70] - The group maintains good relationships with key stakeholders, including employees, customers, suppliers, and shareholders[71]