Financial Performance - In the first half of 2024, the company achieved revenue of RMB 811.3 million, a decrease of 3.7% compared to the same period in 2023, and recorded a profit of RMB 69.1 million, down 30.1% year-on-year[17]. - The company's revenue decreased by 3.7% from RMB 842.8 million in the six months ended June 30, 2023, to RMB 811.3 million in the same period of 2024[30]. - The group's tea sales revenue decreased by 6.4% from RMB 611.1 million for the six months ended June 30, 2023, to RMB 571.8 million for the six months ending June 30, 2024[33]. - Gross profit decreased by 8.3% from RMB 462.4 million to RMB 424.1 million, with the gross margin declining from 54.9% to 52.3% due to adjustments in tea product categories and a decrease in retail proportion[34]. - The group's net profit decreased by 30.1% from RMB 98.9 million to RMB 69.1 million, with the net profit margin dropping from 11.7% to 8.5% due to reduced revenue and gross margin[40]. - Basic and diluted earnings per share were both RMB 0.06, down from RMB 0.09 in the same period last year[80]. - The interim dividend declared is HKD 0.03 per share (equivalent to RMB 0.027), compared to HKD 0.05 per share (equivalent to RMB 0.046) for the same period last year[52]. - The total dividends paid for the six months ended June 30, 2024, amounted to RMB 120,669,000, compared to RMB 126,232,000 for the same period in 2023, representing a decrease of 4.5%[162]. Sales and Revenue Breakdown - Sales of tea accounted for 70.5% of total revenue in the first half of 2024, down from 72.5% in the same period of 2023, with revenue of RMB 571.8 million[31]. - Sales of tea food increased to RMB 110.1 million, representing 13.6% of total revenue, compared to RMB 107.8 million and 12.8% in the previous year[31]. - Revenue from tea food sales increased to RMB 110,100,000, up 2.4% from RMB 107,771,000 in the previous year[108]. - Revenue from tea utensils rose to RMB 101,728,000, an increase of 9.4% compared to RMB 93,020,000 in the same period last year[108]. Operational Developments - The company is actively expanding its customer loyalty programs and enhancing marketing strategies to improve operational efficiency and customer retention[17]. - The company is focusing on optimizing its sales network in China to enhance the coverage of its tea product sales[19]. - The company plans to expand its retail network in China, focusing on high-traffic areas in selected cities and increasing penetration in third- and fourth-tier cities[24]. - The company has established a food R&D department to develop diverse traditional foods, including pork crisps and instant bird's nest[22]. - The company is expanding its production capacity by increasing the number of processing bases, with existing facilities in Fujian, Sichuan, Zhejiang, Guangxi, and Guizhou provinces[27]. - The company continues to develop new tea-related products to meet changing consumer preferences and trends, including tea beverages under the "放牛斑" brand[24]. Cost Management and Financial Health - The company has implemented measures to control costs while improving employee welfare and training[17]. - Administrative expenses increased by 4.0% from RMB 137.7 million to RMB 143.2 million, primarily due to rising labor and depreciation costs[35]. - Cash and cash equivalents increased by 25.8% from RMB 275.1 million to RMB 346.1 million, primarily due to increased cash generated from operations and borrowings[40]. - Total bank borrowings rose from RMB 521.1 million to RMB 585.7 million, with the capital debt ratio increasing from 22.6% to 25.3% due to higher total borrowings and the inclusion of lease liabilities in total debt[41]. - The company has sufficient working capital and financial resources to support daily operations as of June 30, 2024[46]. Market Conditions and Future Outlook - The macroeconomic environment remains challenging with rising inflation and geopolitical tensions, impacting overall consumer spending[17]. - The company anticipates a gradual recovery in consumer demand driven by government policies aimed at boosting domestic consumption[17]. - The company expects the Chinese retail market to gradually recover from COVID-19 disruptions in the second half of 2024, aiming to maintain market share[22]. Shareholder Information - As of June 30, 2024, the total issued shares amounted to 1,086,130,460, including 35,000 shares repurchased for cancellation but not yet cancelled[64]. - The major shareholder, 周楠楠女士, holds 455,199,028 shares, which is 41.91% of the total shares[63]. - Discerning Group Limited holds 188,789,000 shares, representing 17.38% of the total shares[63]. - UBS TC (Jersey) Ltd. is the trustee for KCL Trust, which holds 378,273,000 shares, accounting for 34.83% of the total shares[63]. - The company has confirmed compliance with the standard code for securities trading by all directors for the six months ending June 30, 2024[67]. Corporate Governance - The company maintains high corporate governance standards and has complied with the corporate governance code as of June 30, 2024[66]. - The audit committee has reviewed the interim financial results for the six months ended June 30, 2024[74]. - The interim report will be available on the Hong Kong Stock Exchange and the company's website for public access[75].

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，概不就因本公告全部或任何部分內容而產生或因依 賴該等內容而引致的任何損失承擔任何責任。 Tenfu (Cayman) Holdings Company Limited 天福（開曼）控股有限公司 （於開曼群島註冊成立的有限公司） （股份代號：6868） 截至2024年6月30日止6個月中期業績公告 | --- | --- | |-------|----------------------------------------------------------------------------------------------------------------------------------------| | | | | | 財務摘要 | | • | 截至 2024 年 6 月 30 日止 6 個月的收入由 2023 年同期的約人民幣 842.8 百萬元 減少 3.7% 至約人民幣 811.3 百萬元； | | • | 本集團的毛利由截至 2023 年 6 月 30 日止 6 個月的 ...

Financial Performance - For the fiscal year ending December 31, 2023, revenue increased by 1.1% to RMB 1,734.1 million from RMB 1,715.4 million in 2022[7]. - Gross profit rose by 2.2% to RMB 940.4 million, with a gross margin improvement from 53.6% in 2022 to 54.2% in 2023[7]. - Profit attributable to shareholders increased by 3.2% to RMB 213.2 million, with a net profit margin rising from 12.0% in 2022 to 12.3% in 2023[7]. - Basic earnings per share for the year were RMB 0.20, and the board proposed a final dividend of HKD 0.12 per share, equivalent to RMB 0.11[7]. - Total revenue for 2023 is expected to reach RMB 1.7 billion, despite challenges in the retail market due to post-pandemic effects and economic slowdowns[10]. - In 2023, the company achieved revenue of RMB 1,734.1 million, an increase of 1.1% compared to 2022, and recorded annual profit of RMB 213.2 million, up 3.2% year-on-year[17]. - The company's net profit margin increased from 12.0% in 2022 to 12.3% in 2023, primarily due to the increase in revenue[19]. - Revenue from tea sales amounted to RMB 1,254.7 million, representing 72.4% of total revenue, with a 0.9% increase from RMB 1,243.8 million in 2022[25]. - Revenue from tea food sales was RMB 244.5 million, accounting for 14.1% of total revenue, reflecting a 0.3% increase from RMB 243.7 million in 2022[25]. - Revenue from tea utensils increased by 3.5% to RMB 175.2 million, making up 10.1% of total revenue[25]. Retail and Market Presence - The company operates over 1,377 retail outlets and specialty stores across 31 provinces, regions, and municipalities in China as of December 31, 2023[3]. - The company has maintained a strong brand presence, being ranked first in the 2019 Chinese Tea Chain Brand Power Index[3]. - As of December 31, 2023, the company owned a total of 1,377 retail outlets and specialty stores, up from 1,332 as of December 31, 2022[18]. - The company plans to expand its sales network and optimize store locations, particularly in tier 3 and tier 4 cities, to enhance market presence[11]. - The company is focusing on building private traffic pools through WeChat and enhancing offline store presence to adapt to changing consumer market trends[99]. Financial Stability and Liabilities - The total assets as of December 31, 2023, are RMB 3,001,844 thousand, a decrease from RMB 3,139,492 thousand in 2022[9]. - The total liabilities decreased to RMB 1,216,132 thousand in 2023, down from RMB 1,369,426 thousand in 2022, indicating improved financial stability[9]. - The capital-to-debt ratio improved to 22.6% in 2023 from 27.7% in 2022, reflecting better management of liabilities[9]. - Cash and cash equivalents decreased by RMB 73.3 million or 21.0% from RMB 348.4 million as of December 31, 2022, to RMB 275.1 million as of December 31, 2023[37]. - Total bank borrowings decreased from RMB 678.1 million as of December 31, 2022, to RMB 521.1 million as of December 31, 2023[38]. Product Development and Strategy - The company has a multi-brand strategy to capture various segments of the traditional Chinese tea market, with its most recognized brand being "Tenfu"[3]. - New product development initiatives include the establishment of a culinary R&D department to diversify offerings, such as traditional delicacies and milk tea products[11]. - The company aims to develop new tea-related products to maintain its market leadership and adapt to changing consumer preferences[22]. - The company has adjusted its product mix, with a higher proportion of mid-to-high-end products to meet customer needs, and saw an increase in green tea sales revenue during the year[18]. - The company is planning to expand its product offerings to include health supplements such as bird's nest, sea cucumber, and ginseng to attract different customer segments[102]. Operational Efficiency and Cost Management - The company emphasizes cost management and operational efficiency to maintain profitability amid rising raw material costs[10]. - Inventory turnover days improved to 472 days in 2023 from 481 days in 2022, indicating better inventory management[9]. - Distribution costs decreased by 4.2% from RMB 380.3 million for the year ended December 31, 2022, to RMB 364.2 million for the year ended December 31, 2023, primarily due to cost control measures and a reduction in self-operated retail stores[29]. - Administrative expenses increased by 3.8% from RMB 272.6 million for the year ended December 31, 2022, to RMB 283.0 million for the year ended December 31, 2023, mainly due to increased labor costs and travel expenses[30]. Corporate Governance and Management - The company has established a strong governance framework with independent non-executive directors overseeing audit and remuneration committees, ensuring transparency and accountability[53][54]. - The board consists of nine members, including five executive directors, one non-executive director, and three independent non-executive directors, complying with the requirement that at least one-third of the board members are independent[59]. - The company emphasizes the importance of high-quality governance to enhance shareholder value and ensure long-term sustainable growth[56]. - The board is responsible for overseeing environmental, social, and governance (ESG) matters, assessing and managing significant risks[56]. - The company has established a whistleblowing policy for employees and stakeholders to report suspected misconduct confidentially[84]. Shareholder Engagement and Dividends - The company aims to declare dividends of no less than 20% of the group's after-tax consolidated profit for each financial year[106]. - The company plans to distribute a final dividend of HKD 0.12 per ordinary share, equivalent to RMB 0.11 per share, subject to shareholder approval at the annual general meeting on May 10, 2024[103]. - The company encourages shareholder participation in meetings and activities, promoting effective communication and engagement with stakeholders[90]. - The company has implemented a shareholder communication policy, which was reviewed for effectiveness as of December 31, 2023[89]. Risk Management - The company has established a three-tier risk management framework, with operational management responsible for identifying and managing daily operational risks[78]. - The board has reviewed the effectiveness of the mechanisms in place for risk management and internal controls as of December 31, 2023[73]. - The internal audit department provides reasonable assurance regarding governance, risk management, and internal control effectiveness, conducting risk-oriented audits regularly[82]. - The group employs a three-line defense model for risk management, with operational management as the first line, risk management oversight as the second, and internal audit as the third[80]. Market Challenges and Consumer Trends - The external environment remains complex and severe, with the global economy showing weak recovery and domestic economic challenges, leading to insufficient market confidence[97]. - Domestic economic recovery is characterized by a wave-like and tortuous process, with consumer market recovery momentum being weaker than expected[97]. - The tea industry faces intensified competition, with market share increasingly concentrated among brands with advantages in branding, channels, and product quality[99]. - The health-conscious consumer trend is driving demand for health-related products, with nearly 90% of consumers considering health attributes when purchasing gifts[102]. Related Party Transactions - The group has established ongoing related party transactions since 2009, primarily involving property leases[124]. - The company has entered into a renewed purchasing agreement with Lu Yu for tea sets, with annual purchase limits of RMB 20 million, RMB 22 million, and RMB 24 million for the years ending December 31, 2023, 2024, and 2025 respectively[126]. - The company has renewed a processing agreement with Samoa Group for tea leaf processing services, with annual limits of RMB 1 million, RMB 1.5 million, and RMB 2 million for the years ending December 31, 2023, 2024, and 2025 respectively[128]. Employee and Workforce Management - As of December 31, 2023, the company employed a total of 3,596 full-time employees, with compensation based on corporate performance and individual contributions[134]. - The company has established a mandatory provident fund scheme for employees in Hong Kong, with contributions set at 5% of relevant income, capped at HKD 30,000 per month[134]. - The company has not encountered any significant difficulties in recruitment or experienced major employee turnover during the reporting period[49].

Financial Performance - For the year ended December 31, 2023, revenue increased by 1.1% to RMB 1,734.1 million from RMB 1,715.4 million in 2022[2] - Gross profit rose by 2.2% to RMB 940.4 million, with a gross margin improvement from 53.6% in 2022 to 54.2% in 2023[2] - Profit attributable to shareholders increased by 3.2% to RMB 213.2 million, with a net profit margin rising from 12.0% in 2022 to 12.3% in 2023[2] - Basic earnings per share for the year were RMB 0.20, compared to RMB 0.19 in the previous year[3] - The net profit for the year was RMB 213,238 thousand, compared to RMB 206,452 thousand in 2022, representing a growth of 3.6%[15] - Net profit attributable to shareholders increased by RMB 6.7 million or 3.2% from RMB 206.5 million for the year ended December 31, 2022, to RMB 213.2 million for the year ended December 31, 2023, with a net profit margin increase from 12.0% to 12.3%[67] Revenue Breakdown - Revenue from tea sales reached RMB 1,254,692 thousand, up 0.3% from RMB 1,243,753 thousand in the previous year[14] - Revenue from tea food sales was RMB 244,518 thousand, showing a marginal increase from RMB 243,747 thousand in 2022[14] - Revenue from tea utensils sales increased to RMB 175,240 thousand, compared to RMB 169,225 thousand in 2022, reflecting a growth of 3.6%[14] - Revenue from tea sales rose by 0.9% to RMB 1,254.7 million, while tea food sales increased by 0.3% to RMB 244.5 million, and tea utensils sales grew by 3.5% to RMB 175.2 million[56] Assets and Liabilities - Total assets as of December 31, 2023, amounted to RMB 3,001.8 million, a decrease from RMB 3,139.5 million in 2022[5] - Current liabilities decreased to RMB 945.6 million from RMB 1,117.1 million in 2022[6] - Non-current liabilities increased to RMB 270.5 million from RMB 252.3 million in 2022[6] - The total equity attributable to shareholders rose to RMB 1,785.7 million from RMB 1,770.1 million in 2022[6] - Total liabilities as of December 31, 2023, were RMB 1,216,132 thousand, with tea segment liabilities at RMB 571,480 thousand[17] Dividends and Share Repurchases - The board proposed a final dividend of HKD 0.12 per share, equivalent to RMB 0.11 per share[2] - The company declared a total dividend of RMB 168,829,000 for the year ended December 31, 2023, compared to RMB 161,691,000 in 2022[28] - The company repurchased 5,022,000 ordinary shares in 2023 at a total value of approximately HKD 23,331,000, equivalent to RMB 21,282,000[39] - The company repurchased a total of 2,643,000 shares in November 2023 at a maximum price of HKD 4.57 per share, totaling HKD 11,617,710[82] - In December 2023, the company repurchased 2,036,000 shares at a maximum price of HKD 5.10 per share, totaling HKD 10,016,010[82] Operational Highlights - The company operates in tea classification, packaging, sales, and related sectors primarily in China[7] - The company has approximately 166 self-owned retail stores and about 1,211 distributor stores in mainland China, accounting for 34.5% and 62.1% of total revenue, respectively[56] - The company plans to expand its retail network in third and fourth-tier cities and enhance online sales through its subsidiary, Xiamen Tianyu Trading Co., Ltd[52] - The company plans to continue optimizing its retail network in 2024, focusing on enhancing profitability and maximizing the engagement of third-party retailers[51] Cost Management - Distribution costs decreased by 4.2% from RMB 380.3 million in 2022 to RMB 364.2 million in 2023, attributed to cost control measures[59] - Administrative expenses increased by 3.8% from RMB 272.6 million for the year ended December 31, 2022, to RMB 283.0 million for the year ended December 31, 2023, primarily due to increased labor costs and travel expenses[60] - Financing costs decreased by 12.5% from RMB 29.6 million for the year ended December 31, 2022, to RMB 25.9 million for the year ended December 31, 2023, reflecting reduced interest expenses on bank borrowings[64] Government Grants and Financing - Government grants received in 2023 were RMB 4,472,000, down from RMB 19,101,000 in 2022[21] - The company received government grants totaling RMB 42,882,000 as of December 31, 2023, compared to RMB 42,484,000 in 2022, showing a slight increase of 0.9%[47] - The net financing cost for the year ended December 31, 2023, was RMB (18,998,000), an increase from RMB (10,022,000) in 2022[23] Compliance and Governance - The audit committee has reviewed the annual performance for the year ending December 31, 2023, which has been approved by the company's auditor[85] - The company has adopted the standard code of conduct for securities trading by directors, confirming compliance for the year ending December 31, 2023[84] - The company plans to propose the reappointment of PwC as its auditor at the annual general meeting[85] Future Outlook - The company aims to develop new tea-related products to maintain its leading brand position and meet changing consumer preferences[53] - The company emphasizes enhancing brand reputation and customer awareness through targeted marketing and promotional activities[52] - The company plans to increase processing facilities to meet future demand for tea and related products[53]

Financial Performance - The company achieved a revenue of RMB 842.8 million in the first half of 2023, an increase of 5.0% compared to the same period in 2022[14]. - Net profit for the first half of 2023 was RMB 98.9 million, representing a 31.7% increase year-on-year[14]. - The gross profit margin improved from 9.4% in the first half of 2022 to 11.7% in the first half of 2023 due to increased sales and cost control measures[19]. - The company's revenue increased by 5.0% from RMB 802.4 million in the six months ended June 30, 2022, to RMB 842.8 million in the six months ended June 30, 2023[31]. - Revenue from tea sales rose by 4.5% from RMB 584.7 million to RMB 611.1 million during the same period[33]. - Revenue from tea food sales increased by 5.8% from RMB 101.9 million to RMB 107.8 million[33]. - The group's gross profit increased by 4.6% from RMB 441.9 million for the six months ended June 30, 2022, to RMB 462.4 million for the six months ended June 30, 2023, while the gross margin decreased from 55.1% to 54.9%[38]. - The group's profit attributable to shareholders increased by RMB 23.8 million or 31.7% from RMB 75.1 million for the six months ended June 30, 2022, to RMB 98.9 million for the six months ended June 30, 2023, with a net profit margin rising from 9.4% to 11.7%[46]. - Operating profit increased to RMB 143,154 thousand, up 40.5% from RMB 101,691 thousand in the previous year[90]. - The net profit for the six months ended June 30, 2023, was RMB 98,910 thousand, representing a 31.6% increase from RMB 75,065 thousand in the same period last year[90]. Cost Management - The company has implemented cost control measures, resulting in a reduction of distribution costs and administrative expenses compared to the same period in 2022[19]. - The company's cost of sales increased by 5.5% from RMB 360.5 million to RMB 380.4 million, primarily due to increased sales volume[37]. - Distribution costs decreased by 8.1% from RMB 203.4 million for the six months ended June 30, 2022, to RMB 187.0 million for the six months ended June 30, 2023, primarily due to cost control measures[38]. - Administrative expenses decreased by 3.2% from RMB 142.3 million for the six months ended June 30, 2022, to RMB 137.7 million for the six months ended June 30, 2023, mainly due to reduced employee benefits expenses[39]. Market Expansion and Product Development - The company expanded its retail network to a total of 1,340 self-owned and third-party retail outlets as of June 30, 2023, up from 1,332 at the end of 2022[19]. - The company has diversified its product line, increasing the sales proportion of mid-to-high-end tea products to meet customer demand[19]. - The company plans to expand its retail network, focusing on densely populated commercial areas and smaller cities[22]. - The company continues to develop new tea-related products to meet market demand and adapt to changing consumer preferences[24]. - The company is expanding production capacity by increasing the number of processing bases, with plans for a new white tea packaging factory in Fujian[24]. Financial Position and Liquidity - Cash and cash equivalents decreased by RMB 59.3 million or 17.0% from RMB 348.4 million as of December 31, 2022, to RMB 289.1 million as of June 30, 2023, mainly due to cash outflows from investing and financing activities[46]. - The total bank borrowings decreased from RMB 678.1 million as of December 31, 2022, to RMB 639.6 million as of June 30, 2023, with a weighted average effective interest rate of 3.17%[46]. - The capital debt ratio decreased from 27.7% as of December 31, 2022, to 26.9% as of June 30, 2023, primarily due to a reduction in total borrowings[48]. - The company has sufficient working capital and financial resources to support daily operations as of June 30, 2023[54]. - The company reported a basic and diluted earnings per share of RMB 0.09 for the six months ended June 30, 2023, compared to RMB 0.07 for the same period in 2022[90]. Shareholder Returns and Dividends - The interim dividend of HKD 0.05 per share (equivalent to RMB 0.046) will be paid on September 27, 2023, representing 50% of the after-tax consolidated net profit for the six months ended June 30, 2023[61]. - The interim dividend declared was RMB 50,196,000, compared to RMB 37,182,000 in the previous year, reflecting a growth in shareholder returns[174]. Corporate Governance and Compliance - The company is committed to high corporate governance standards and has complied with the corporate governance code[75]. - The audit committee reviewed the group's unaudited interim results for the six months ended June 30, 2023[84]. - The interim report will be sent to shareholders and is available on the company's website[85]. Related Party Transactions - The group purchased goods and services from related parties amounting to RMB 56,567,000 in the first half of 2023, a slight increase of 3.7% from RMB 54,549,000 in the same period of 2022[178]. - The group reported a total of RMB 15,347,000 in right-of-use assets from related parties for the first half of 2023, up from RMB 14,412,000 in the same period of 2022, reflecting a growth of 6.5%[178]. - The group’s transactions with subsidiaries of the controlling shareholder included purchases from Samoa's subsidiaries amounting to RMB 50,702,000 in the first half of 2023, an increase from RMB 43,624,000 in the same period of 2022[178].

Financial Performance - For the six months ended June 30, 2023, revenue increased by 5.0% to approximately RMB 842.8 million from approximately RMB 802.4 million in the same period of 2022[2] - Gross profit rose by 4.6% to RMB 462.4 million, compared to RMB 441.9 million for the same period in 2022[2] - Profit for the period increased to RMB 98.9 million, up from RMB 75.1 million in the same period of 2022[2] - Basic earnings per share for the period were RMB 0.09, compared to RMB 0.07 for the same period in 2022[3] - The adjusted operating profit for the tea segment was RMB 137,571,000, compared to RMB 150,119,000 in the previous year, indicating a decrease of 8.4%[17] - The company reported a net profit before tax of RMB 98,910,000 for the six months ended June 30, 2023[17] - The company's profit attributable to shareholders increased by RMB 23.8 million or 31.7% to RMB 98.9 million for the six months ended June 30, 2023, compared to RMB 75.1 million for the same period in 2022[61] - The net profit margin improved from 9.4% for the six months ended June 30, 2022, to 11.7% for the same period in 2023, driven by increased revenue and cost control measures[61] Dividends and Share Repurchase - The board declared an interim dividend of HKD 0.05 per share, equivalent to RMB 0.046 per share[2] - The company declared an interim dividend of RMB 50,196,000, up from RMB 37,182,000 in the previous year, reflecting a 35% increase[29] - The interim dividend declared is HKD 0.05 per share, representing 50% of the after-tax consolidated profit for the six months ended June 30, 2023[73] - The interim dividend for 2022 was HKD 0.04 per share, indicating a 25% increase year-over-year[73] - The company repurchased 222,000 shares at a total value of approximately HKD 1,070,000 (about RMB 948,000) during the first half of 2023[38] - The total number of shares repurchased in 2023 was 222,000, with a total cost of HKD 1,064,520[70] - The highest repurchase price was HKD 5.15 and the lowest was HKD 4.60 during the first half of 2023[70] Assets and Liabilities - Total assets as of June 30, 2023, were RMB 3,026.2 million, a decrease from RMB 3,139.5 million as of December 31, 2022[4] - Total liabilities decreased from RMB 1,369.4 million as of December 31, 2022, to RMB 1,284.4 million as of June 30, 2023[7] - Non-current assets amounted to RMB 1,418.7 million, compared to RMB 1,361.8 million at the end of 2022[4] - Inventory as of June 30, 2023, was RMB 1,024.0 million, down from RMB 1,063.4 million at the end of 2022[4] - The total amount of borrowings as of June 30, 2023, was RMB 639.6 million, a decrease from RMB 678.1 million as of December 31, 2022[43] - The company reported short-term bank borrowings of RMB 477.4 million as of June 30, 2023, down from RMB 535.3 million at the end of 2022[43] - The debt-to-capital ratio improved to 26.9% as of June 30, 2023, down from 27.7% as of December 31, 2022, mainly due to a reduction in total borrowings[64] Revenue Breakdown - Sales of tea amounted to RMB 611,059,000, up from RMB 584,720,000, reflecting a growth of 4.7% year-over-year[16] - Sales of tea food reached RMB 107,771,000, an increase of 5.8% compared to RMB 101,919,000 in the previous year[16] - Revenue from tea sales rose by 4.5% to RMB 611.1 million, while revenue from tea food increased by 5.8% to RMB 107.8 million; however, revenue from tea utensils decreased by 2.4% to RMB 93.0 million[51] Cost Management - The cost of sales increased by 5.5% to RMB 380.4 million, primarily due to increased sales volume[53] - Distribution costs decreased by 8.1% to RMB 187.0 million, attributed to cost control measures[55] - Administrative expenses decreased by 3.2% to RMB 137.7 million, also due to cost control measures[56] - Other income increased by 11.9% to RMB 7.5 million, mainly from investment property income[57] - Income tax expense rose by 19.1% to RMB 38.7 million, driven by an increase in profit before tax from RMB 107.6 million to RMB 137.6 million[60] Operational Developments - The company has established a food research and development department to diversify its product offerings, including traditional delicacies[47] - The company plans to continue optimizing its retail network, focusing on high-traffic areas in selected cities and expanding its presence in popular shopping centers[48] - The company anticipates a gradual recovery in the Chinese retail sector in the second half of 2023, aiming to maintain market share[47] - As of June 30, 2023, the company had a total of 1,340 retail stores and specialty points, an increase of 8 from 1,332 stores as of December 31, 2022[45] - The company operates approximately 164 self-owned retail stores and 1,176 distributor stores, accounting for 37.6% and 58.7% of total revenue, respectively[52] Compliance and Governance - The company has maintained compliance with the corporate governance code as of June 30, 2023, with no deviations reported[71] - The audit committee has reviewed the accounting principles and practices for the six months ended June 30, 2023[75] - The interim financial statements have been reviewed by external auditors according to the relevant standards[75]

Financial Performance - Revenue for the year ended December 31, 2022, decreased by 10.9% to RMB 1,715.4 million from RMB 1,924.7 million in 2021[7] - Gross profit for the year ended December 31, 2022, decreased by 19.6% to RMB 920.1 million, with a gross margin of 53.6%, down from 59.4% in 2021[7] - Profit attributable to shareholders for the year ended December 31, 2022, decreased by 42.6% to RMB 206.5 million, resulting in a net profit margin of 12.0%, down from 18.7% in 2021[7] - Basic earnings per share for the year ended December 31, 2022, was RMB 0.19[7] - In 2022, the company achieved revenue of RMB 1,715.4 million, a decrease of 10.9% compared to 2021, and recorded an annual profit of RMB 206.5 million, down 42.6% from 2021[17] - Revenue from tea sales dropped by 11.0% from RMB 1,398.2 million in 2021 to RMB 1,243.8 million in 2022[27] - The gross profit fell by 19.6% from RMB 1,144.0 million in 2021 to RMB 920.1 million in 2022, with a gross margin decline from 59.4% to 53.6%[30] - Operating profit decreased to RMB 293,320,000 from RMB 527,457,000, indicating a significant drop in operational efficiency[147] - Net profit attributable to shareholders was RMB 206,452,000, a decline of 42.5% from RMB 359,481,000 in the previous year[147] Assets and Liabilities - Total assets as of December 31, 2022, were RMB 3,139.5 million, a slight decrease from RMB 3,212.1 million in 2021[9] - Total equity as of December 31, 2022, was RMB 1,770.1 million, down from RMB 1,832.8 million in 2021[9] - Total liabilities as of December 31, 2022, were RMB 1,369.4 million, compared to RMB 1,379.2 million in 2021[9] - The capital-to-debt ratio increased to 27.7% in 2022 from 25.3% in 2021[9] - Cash and cash equivalents increased by RMB 110.0 million or 46.1% from RMB 238.4 million as of December 31, 2021, to RMB 348.4 million as of December 31, 2022[39] - Total bank borrowings rose from RMB 619.4 million as of December 31, 2021, to RMB 678.1 million as of December 31, 2022[40] - The debt-to-capital ratio increased from 25.3% as of December 31, 2021, to 27.7% as of December 31, 2022, primarily due to the increase in bank borrowings[43] Operational Strategy - The company plans to continue expanding its store network and optimizing sales points in 2023, focusing on both first and second-tier cities as well as third and fourth-tier cities[11] - New product development includes a dedicated culinary R&D department to create diverse traditional foods, aiming to expand the milk tea market share[11] - The company emphasizes enhancing customer service quality and increasing foot traffic to improve transaction numbers[12] - The digital economy's growth is driving online consumption, prompting the company to enhance its marketing activities, especially on e-commerce platforms[12] - The company is committed to strengthening its brand image and competitive advantages through significant operational measures[13] - Plans to develop a dual-brand strategy with Kinmen Kaoliang Liquor Inc. to sell sorghum liquor in China[14] - The company aims to improve employee training and welfare to enhance service quality and operational efficiency[15] - Focus on product quality and safety while continuously developing new products to meet the needs of mid-to-low-end consumers[15] - The company will actively promote tea-related events and exhibitions to engage with customers and enhance brand loyalty[15] Market and Product Development - The company has adjusted its product mix, increasing the proportion of mid-to-high-end products to meet customer needs in China[18] - The company has established a food research and development department to diversify its product line, including traditional delicacies such as Buddha Jumps Over the Wall and instant bird's nest[18] - The company aims to develop new tea-related products to maintain its leading brand position and adapt to changing consumer preferences[22] - The company is focusing on product innovation to differentiate itself in a highly competitive market, emphasizing health and variety in its offerings[97] - The company is exploring new product development opportunities aligned with seasonal consumer trends, such as spring tea and festival-related products[97] Governance and Compliance - The company has complied with the corporate governance code as of December 31, 2022, with no deviations reported[61] - The board consists of nine members, including five executive directors, one non-executive director, and three independent non-executive directors, ensuring at least one-third independence[63] - The company emphasizes high-quality governance to enhance shareholder value and manage risks, including environmental and social risks[60] - The chairman and CEO positions are held by different individuals to maintain independence and balanced judgment[64] - Each director has a service contract of three years, with provisions for re-election and succession planning[65] - The board is responsible for strategic decisions and overseeing the company's operations and performance[62] - The company regularly reviews its corporate governance practices to ensure compliance with regulations[61] Risk Management - The company has implemented effective internal controls and risk management frameworks[60] - The management team has extensive experience, with the CFO having over 15 years in finance[59] - The company employs a three-line defense model for risk management, focusing on operational management as the first line, which is responsible for identifying and managing daily operational risks[81] - The internal audit department provides reasonable assurance regarding governance, risk management, and internal controls, conducting risk-oriented audits of subsidiaries and recommending necessary actions[82] - The board reviews risk management activities and overall risk exposure at least annually, confirming the effectiveness of the risk management and internal control systems[83] Shareholder Relations - The company emphasizes effective communication with shareholders to enhance investor relations and ensure transparency in disclosures[86] - The company has established a whistleblowing policy for employees and stakeholders to report suspected misconduct confidentially[84] - The company reported a comprehensive income for the year ended December 31, 2022, with detailed financial performance metrics available in the annual report[92] - The company emphasizes the importance of shareholder communication and encourages participation in shareholder activities and meetings[88] - The board of directors has reviewed the implementation and effectiveness of the shareholder communication policy for the year ended December 31, 2022[88] Employee and Management - The company has 3,643 employees as of December 31, 2022, with the majority based in China[52] - Employee costs rose to RMB 334.9 million in 2022 from RMB 315.4 million in 2021, marking an increase of approximately 6.5%[52] - The company has established a mandatory provident fund plan, requiring both employer and employee contributions of 5% of relevant income, with a monthly income cap of HKD 30,000[131] Related Party Transactions - The company has ongoing related party transactions, including lease agreements with various related parties since 2009[115] - The total rent paid or payable under the lease agreements with Mr. Li Jialin for the year ended December 31, 2022, amounted to RMB 1,290,000[117] - The company has maintained compliance with the listing rules regarding related party transactions[115] Future Outlook - The company plans to declare dividends of no less than 20% of the consolidated net profit after tax for each financial year[101] - The company is considering strategic acquisitions to bolster its market position, with potential targets identified in the H sector[55] - The company plans to optimize its retail network and expand into third and fourth-tier cities, aiming to enhance profitability and market penetration[21]

Financial Performance - For the year ended December 31, 2022, revenue decreased by 10.9% to RMB 1,715.4 million from RMB 1,924.7 million in 2021[2] - Gross profit for the year ended December 31, 2022, decreased by 19.6% to RMB 920.1 million, with a gross margin of 53.6%, down from 59.4% in 2021[2] - Profit attributable to shareholders for the year ended December 31, 2022, decreased by 42.6% to RMB 206.5 million, resulting in a net profit margin of 12.0%, down from 18.7% in 2021[2] - Basic earnings per share for the year ended December 31, 2022, were RMB 0.19, compared to RMB 0.33 in 2021[4] - The company reported a net profit of RMB 206,452 thousand for the year ended December 31, 2022[17] - The net profit attributable to shareholders for 2022 was RMB 206,452,000, down from RMB 359,481,000 in 2021, representing a decline of approximately 42.5%[29] - The company reported a basic earnings per share of RMB 0.19 for 2022, compared to RMB 0.33 for 2021, reflecting a decrease of 42.4%[29] - The company's net profit for the year ended December 31, 2022, decreased by 42.6% to RMB 206.5 million, with a net profit margin of 12.0%[65] Revenue Breakdown - Total revenue for the year ended December 31, 2022, was RMB 1,715,400 thousand, a decrease of 10.9% from RMB 1,924,651 thousand in 2021[16] - Revenue from tea sales was RMB 1,243,753 thousand, down 11.1% from RMB 1,398,189 thousand in the previous year[16] - Revenue from tea sales decreased by 11.0% to RMB 1,243.8 million, while tea food sales decreased by 1.7% to RMB 243.7 million, and tea utensils sales decreased by 14.5% to RMB 169.2 million[56] Assets and Liabilities - Total assets as of December 31, 2022, were RMB 3,139.5 million, a decrease from RMB 3,212.1 million as of December 31, 2021[5] - Total liabilities as of December 31, 2022, were RMB 1,369.4 million, compared to RMB 1,379.2 million as of December 31, 2021[8] - Non-current assets increased slightly to RMB 1,361.8 million from RMB 1,330.9 million in 2021[5] - Trade and other receivables decreased to RMB 282.3 million from RMB 380.9 million in 2021[5] - The total amount of trade and other receivables was RMB 282,301,000 as of December 31, 2022, compared to RMB 380,895,000 in 2021, indicating a decline of about 25.9%[35] Dividends and Share Repurchase - The board proposed a final dividend of HKD 0.13 per share, equivalent to RMB 0.11 per share[2] - The company declared a final dividend of RMB 124,509,000 for 2022, down from RMB 204,789,000 in 2021, which is a reduction of approximately 39.2%[30] - The company repurchased 3,121,000 shares in 2022 at a total value of approximately HKD 15,956,000, equivalent to RMB 13,826,000[40] - The company repurchased a total of 3,121,000 shares during the year ended December 31, 2022, at a total cost of HKD 15,891,140[84] Operational Efficiency and Strategy - The company continues to enhance its market position and operational efficiency through various strategies, including expanding its network and improving employee training[50] - The company aims to leverage its strong brand recognition and market presence to capture a larger market share as the market recovers[50] - The company plans to optimize its retail network by establishing new retail stores in densely populated commercial areas and expanding into third- and fourth-tier cities[53] - The company aims to enhance brand reputation and customer awareness through targeted marketing activities, especially during traditional Chinese festivals[53] Compliance and Governance - The company has adhered to the corporate governance code and has not deviated from its provisions during the year ended December 31, 2022[83] - The audit committee for the company consists of independent non-executive directors, including Mr. Lu Wah Wei, Dr. Huang Wei, and Mr. Li Junxiong, with Mr. Lu serving as the chairman[88] - The annual performance for the year ending December 31, 2022, has been reviewed by the audit committee and approved by the company's auditor, PwC[88] Employee and Administrative Costs - Employee costs for the year ended December 31, 2022, amounted to RMB 334.9 million, an increase from RMB 315.4 million for the year ended December 31, 2021, representing a growth of approximately 6.5%[80] - The company's administrative expenses increased by 15.0% to RMB 272.6 million, primarily due to rising labor costs and depreciation of property, plant, and equipment[60] Government Grants and Other Income - The company reported government grants of RMB 19,101,000 in 2022, an increase from RMB 13,693,000 in 2021, reflecting a growth of approximately 39.5%[24] - Other income increased by 43.7% to RMB 28.3 million, mainly due to local government subsidies rising from RMB 13.7 million to RMB 19.1 million[61]

Financial Performance - The company reported a revenue of RMB 802.4 million for the first half of 2022, a decrease of 14.8% compared to the same period in 2021[9]. - Net profit for the same period was RMB 75.1 million, down 52.6% year-on-year[9]. - Revenue for the six months ended June 30, 2022, was RMB 802,411 thousand, a decrease of 14.8% compared to RMB 942,069 thousand for the same period in 2021[82]. - Gross profit for the same period was RMB 441,919 thousand, down from RMB 538,383 thousand, reflecting a gross margin decline[82]. - Operating profit decreased to RMB 101,691 thousand from RMB 234,205 thousand, indicating a significant reduction in operational efficiency[82]. - Profit attributable to shareholders decreased by RMB 83.5 million or 52.6% from RMB 158.6 million for the six months ended June 30, 2021, to RMB 75.1 million for the six months ended June 30, 2022, with a net profit margin declining from 16.8% to 9.4%[33]. - Basic and diluted earnings per share for the period were RMB 0.07, down from RMB 0.14 in the previous year[82]. - The company reported a net profit of RMB 75,065 thousand for the six months ended June 30, 2022, compared to the previous year's profit[111]. Revenue Breakdown - Revenue from tea sales dropped by 12.8% from RMB 670.6 million to RMB 584.7 million, while tea food sales fell by 14.8% from RMB 119.6 million to RMB 101.9 million[22]. - Tea sales generated RMB 584,720 thousand, down 12.8% from RMB 670,646 thousand in the previous year[109]. - The adjusted operating profit for the tea segment was RMB 91,720 thousand, while the tea food segment reported RMB 11,612 thousand[111]. Cost and Expenses - The gross profit decreased by 17.9% from RMB 538.4 million to RMB 441.9 million, with the gross margin declining from 57.1% to 55.1%[23]. - Distribution costs increased by 1.8% from RMB 199.9 million to RMB 203.4 million, primarily due to rising labor and advertising expenses[25]. - Administrative expenses rose by 18.4% from RMB 120.2 million to RMB 142.3 million, mainly due to increased labor costs and depreciation of fixed assets[26]. - The company incurred depreciation expenses of RMB 39,806 thousand for property, plant, and equipment across all segments[113]. - Depreciation and amortization expenses for the six months ended June 30, 2022, totaled RMB 39,806,000 for property, plant, and equipment, an increase from RMB 35,446,000 in 2021[151]. Assets and Liabilities - Total assets amounted to RMB 2,972,672,000, a decrease from RMB 3,212,062,000 as of December 31, 2021[79]. - Total liabilities decreased to RMB 1,286,310 thousand from RMB 1,379,243 thousand, indicating improved financial leverage[80]. - Trade and other receivables decreased from RMB 380.9 million as of December 31, 2021, to RMB 221.1 million as of June 30, 2022, mainly due to a reduction in sales to third parties[42]. - Inventory decreased from RMB 1,061.9 million as of December 31, 2021, to RMB 1,014.0 million as of June 30, 2022, attributed to a decrease in purchase volume[42]. - The total amount of trade and other receivables was RMB 221,059,000 as of June 30, 2022, down from RMB 380,895,000 as of December 31, 2021, indicating a decrease of approximately 42.1%[128]. Cash Flow and Financing - Cash and cash equivalents increased by RMB 103.0 million or 43.2% from RMB 238.4 million as of December 31, 2021, to RMB 341.4 million as of June 30, 2022, primarily due to cash generated from operations[35]. - Cash generated from operating activities was RMB 332,344 thousand, an increase from RMB 318,231 thousand year-on-year[84]. - Total bank borrowings increased from RMB 619.4 million as of December 31, 2021, to RMB 672.7 million as of June 30, 2022, with a weighted average effective interest rate of 3.31%[35]. - Financing income increased from RMB 3.6 million for the six months ended June 30, 2021, to RMB 16.3 million for the six months ended June 30, 2022, mainly due to an increase in foreign exchange income[28]. - Financing costs decreased by 4.9% from RMB 14.2 million for the six months ended June 30, 2021, to RMB 13.5 million for the six months ended June 30, 2022, reflecting a reduction in interest expenses on bank borrowings[31]. Market Strategy and Operations - The company has adjusted its product mix, increasing the proportion of mid-to-high-end products to meet customer demand, with green tea sales revenue rising during the period[12]. - The company plans to continue optimizing its retail network, focusing on high-traffic areas in selected cities and expanding into third- and fourth-tier cities[12]. - A collaboration with Kinmen Kaoliang Liquor Inc. was established to sell liquor under a dual-brand strategy in China[12]. - The company continues to develop new tea-related products to meet market demand and adapt to changing consumer preferences[17]. - The company is focused on quality control, emphasizing the review and control of raw material quality in its supply chain[17]. Shareholder and Governance - The interim dividend declared is HKD 0.04 per share (equivalent to RMB 0.03), which is 50% of the after-tax consolidated net profit for the six months ended June 30, 2022[51]. - Major shareholders include Discerning Group Limited with 188,789,000 shares (17.26%) and KCL Trust with 378,273,000 shares (34.59%)[62]. - The board consists of four members, including three independent non-executive directors, ensuring governance standards are upheld[76]. - The company has established an audit committee to oversee financial reporting and risk management[76]. - The company maintained compliance with the corporate governance code as of June 30, 2022[67]. Challenges and Market Conditions - The impact of COVID-19 and economic slowdowns has led to tightened consumer spending, presenting challenges in the first half of 2022[9]. - Despite uncertainties in the retail market, the company aims to maintain its market share and continue expanding its retail presence[12].

Financial Performance - For the year ended December 31, 2021, revenue increased by 12.4% to RMB 1,924.7 million from RMB 1,712.6 million in 2020[7] - Gross profit rose by 9.4% to RMB 1,144.0 million, with a gross margin of 59.4%, down from 61.1% in 2020[7] - Profit attributable to shareholders increased by 17.7% to RMB 359.5 million, with a net profit margin of 18.7%, up from 17.8% in 2020[7] - Basic earnings per share for the year were RMB 0.33[7] - Total revenue for 2021 reached RMB 1.92 billion, despite challenges from COVID-19 and economic slowdowns[10] - In 2021, the company achieved revenue of RMB 1,924.7 million, an increase of 12.4% compared to 2020, and recorded an annual profit of RMB 359.5 million, up 17.7% from 2020[17] - Revenue from tea sales rose by 14.4% from RMB 1,222.1 million in 2020 to RMB 1,398.2 million in 2021[27] - Revenue from tea food sales increased by 16.2% from RMB 213.4 million in 2020 to RMB 248.0 million in 2021[27] - Revenue from tea utensils grew by 8.4% from RMB 182.6 million in 2020 to RMB 198.0 million in 2021[27] Dividends and Shareholder Returns - The board proposed a final dividend of HKD 0.23 per share, equivalent to RMB 0.19 per share[7] - The company intends to declare dividends of no less than 20% of the group's after-tax consolidated profit for each financial year, subject to financial and business conditions[102] - The company paid dividends to shareholders totaling RMB 255,725 thousand in 2021, compared to RMB 201,704 thousand in 2020, representing an increase of 26.7%[144] Retail and Market Presence - The company operates over 1,300 retail outlets and specialty stores across 31 provinces in China as of December 31, 2021[3] - As of December 31, 2021, the company owned a total of 1,313 retail outlets and specialty stores, up from 1,243 as of December 31, 2020[17] - The company has been actively acquiring retail stores since 2008 to enhance its sales network and customer service capabilities[103] - The company plans to expand its sales network and optimize store locations, particularly in tier 3 and tier 4 cities[14] Product Development and Innovation - The company offers more than 1,300 types of traditional Chinese tea products, holding the largest market share in the traditional Chinese tea segment by retail sales[3] - New product development includes a focus on traditional foods and expanding the milk tea market, aiming to meet diverse consumer demands[11] - The company has adjusted its product offerings, increasing the proportion of mid-to-high-end products to meet customer needs in China[18] - The company is focused on developing new tea-related products to meet market demand and maintain its leading brand position[22] - The company aims to enhance its product innovation capabilities to build market competitiveness through differentiation[98] Financial Position and Assets - The total assets increased from RMB 2.90 billion in 2019 to RMB 3.21 billion in 2021, reflecting a growth of approximately 10.5%[9] - The total liabilities rose from RMB 1.21 billion in 2020 to RMB 1.38 billion in 2021, indicating an increase of about 13.4%[9] - The capital-to-debt ratio remained stable at 25.3% in 2021, compared to 25.1% in 2020[9] - Cash and cash equivalents decreased by RMB 122.6 million or 34.0% from RMB 361.0 million as of December 31, 2020, to RMB 238.4 million as of December 31, 2021[35] - Total bank borrowings increased from RMB 586.6 million as of December 31, 2020, to RMB 619.4 million as of December 31, 2021[37] Governance and Compliance - The company has adhered to the corporate governance code as per the listing rules, with no deviations reported for the year ending December 31, 2021[58] - The board consists of nine members, including five executive directors, one non-executive director, and three independent non-executive directors, complying with the requirement that at least one-third of the board members are independent[60] - The company emphasizes high-quality governance to enhance shareholder value and ensure stakeholder interests are met[58] - The board is responsible for overseeing the company's business, strategic decisions, and performance, with authority delegated to the CEO for daily operations[59] Risk Management and Internal Controls - The company has implemented effective internal controls and risk management frameworks to address environmental, social, and governance (ESG) matters[58] - The company conducted a comprehensive risk assessment, identifying risks across business processes and summarizing them into a final risk list, which is evaluated based on likelihood and impact[79] - The company's risk management and internal control systems were deemed effective and adequate in all material aspects as of December 31, 2021[81] Market Trends and Consumer Behavior - The overall retail industry remains sluggish, with a long recovery period anticipated due to factors such as inflation, trade tensions, and the ongoing impact of the pandemic[95] - The shift in tea consumption trends is moving from first and second-tier cities to third and fourth-tier cities, presenting new growth opportunities[97] - The rise of health-conscious consumption is leading to diversified consumer demands, necessitating innovation in product offerings to break the homogenization in the tea industry[98] - The company is leveraging online platforms like Douyin and Kuaishou to reach consumers, adapting to changing shopping habits post-pandemic[97] Employee and Management Information - The group has a total of 3,508 full-time employees as of December 31, 2021[126] - The management team has over 15 years of financial experience, contributing to the company's strategic planning and operational management[57] - The company has not encountered any significant difficulties in recruitment or experienced major employee turnover during the year[49] Related Party Transactions - The group has ongoing related party transactions, including lease agreements with various related parties since 2009[115] - The group has complied with the disclosure requirements of the Listing Rules regarding related party transactions[115] - The independent non-executive directors confirmed that the ongoing connected transactions were conducted on normal commercial terms and in the overall interest of shareholders[125]