Financial Performance - The group's revenue for the nine months ended December 31, 2021, was approximately HKD 29.1 million, representing a 3.2% increase compared to HKD 28.2 million for the same period in 2020[8] - Gross profit for the same period was approximately HKD 22.8 million, an increase of about 4.1% from HKD 21.9 million in the previous year, with a gross margin of approximately 78.4%[8] - The group reported a net loss of approximately HKD 2.7 million for the nine months ended December 31, 2021, an improvement from a net loss of HKD 4.0 million in the same period of 2020[8] - For the nine months ended December 31, 2021, the group reported total revenue of HKD 29,073,000, an increase from HKD 28,214,000 for the same period in 2020, representing a growth of 3.06%[57] - The gross profit for the nine months ended December 31, 2021, was HKD 22,774,000, compared to HKD 21,919,000 in the previous year, indicating a year-on-year increase of 3.91%[57] - The net profit for the three months ended December 31, 2021, was HKD 2,093,000, up from HKD 1,616,000 in the same period of 2020, reflecting a growth of 29.5%[57] - The basic and diluted earnings per share for the nine months ended December 31, 2021, was a loss of HKD 0.75, improving from a loss of HKD 1.10 in the same period of 2020[57] - For the nine months ended December 31, 2021, the profit attributable to equity holders was HKD 2,093,000, compared to a loss of HKD 2,695,000 for the same period in 2020, representing a significant improvement[83] Expenses and Costs - Administrative expenses decreased by approximately 11.6% to about HKD 22.0 million from HKD 24.9 million in the previous year, mainly due to reductions in rent, legal fees, and employee compensation[10] - The group incurred administrative expenses of HKD 21,958,000 for the nine months ended December 31, 2021, a decrease from HKD 24,897,000 in the same period of 2020, showing a reduction of 12.0%[57] - The group’s financing costs for the nine months ended December 31, 2021, were HKD 2,417,000, down from HKD 2,653,000 in the previous year, indicating a decrease of 8.9%[57] - The group’s sales and distribution costs for the nine months ended December 31, 2021, were HKD 1,323,000, compared to HKD 1,150,000 in the previous year, representing an increase of 15.0%[57] - The total cost of inventory recognized as an expense was HKD 5,348,000 for the nine months ended December 31, 2021, compared to HKD 5,397,000 for the same period in 2020[77] - Depreciation of property, plant, and equipment for the nine months ended December 31, 2021, was HKD 3,307,000, a decrease from HKD 3,542,000 for the same period in 2020[77] Assets and Liabilities - As of December 31, 2021, the group's current assets were approximately HKD 16.6 million, up from HKD 14.2 million in 2020, while current liabilities increased to approximately HKD 15.0 million from HKD 4.6 million[14] - The group's current ratio as of December 31, 2021, was approximately 1.11 times, down from 3.09 times in the previous year[14] - The debt-to-equity ratio as of December 31, 2021, was approximately 370.2%, compared to 271.6% in the previous year, indicating a significant increase in leverage[16] - As of December 31, 2021, the total equity was HKD 25,478,000, down from HKD 36,512,000 as of April 1, 2021, representing a decrease of 30.2%[60] Corporate Governance - The group maintained high standards of corporate governance and complied with the relevant provisions of the corporate governance code[33] - The directors confirmed compliance with the code of conduct for securities transactions during the nine months ended December 31, 2021[34] - The board of directors resolved not to declare any dividends for the nine months ended December 31, 2021, consistent with the previous year[26] - The company did not purchase, sell, or redeem any of its listed securities during the nine months ended December 31, 2021[35] - There were no significant events after the reporting period that would impact the group's performance for the nine months ended December 31, 2021[30] Shareholding and Stock Options - As of December 31, 2021, the directors and senior management held a total of 270,000,000 shares, representing approximately 74.70% of the company's ordinary shares[37] - The total number of shares held by major shareholders is 270,000,000, which is consistent across multiple entities[44] - The stock option plan was approved on March 14, 2018, to incentivize selected participants for their contributions to the group[50] - The stock option plan includes full-time employees, consultants, and other selected participants[50] - The total number of unexercised share options as of December 31, 2021, was 28,450,000, down from 30,900,000 at the beginning of the period, reflecting a reduction of 7.9%[51] - The stock options granted under the plan are part of the company's strategy to reward contributions from various stakeholders[50] Market Outlook - The group expects the retail environment to gradually recover as vaccination rates increase, maintaining an optimistic outlook for the overall retail market in Hong Kong[13]

Financial Performance - The group's revenue for the six months ended September 30, 2021, was approximately HKD 14.4 million, an increase of about 8.3% compared to HKD 13.3 million for the same period in 2020[3]. - Gross profit for the reporting period was approximately HKD 11.4 million, representing an increase of about 11.8% from HKD 10.2 million in the previous year, with a gross margin of approximately 79.2%[7]. - The net loss for the reporting period was approximately HKD 4.8 million, a decrease from a net loss of HKD 5.6 million in the same period last year[7]. - The group reported revenue of HKD 14,396,000 for the six months ended September 30, 2021, an increase of 8.5% compared to HKD 13,268,000 for the same period in 2020[54]. - Gross profit for the same period was HKD 11,409,000, representing a 11.5% increase from HKD 10,232,000 year-on-year[54]. - The group reported a loss attributable to equity holders of the company of HKD 4,788,000 for the six months ended September 30, 2021, compared to a loss of HKD 5,592,000 for the same period in 2020[101]. Expenses and Cost Management - Administrative expenses decreased by approximately 10.1% to about HKD 14.2 million from HKD 15.8 million for the six months ended September 30, 2020, primarily due to reduced rental and salary expenses[9]. - The group’s administrative expenses decreased to HKD 14,247,000 for the six months ended September 30, 2021, from HKD 15,785,000 for the same period in 2020[54]. - Total remuneration for key management personnel was HKD 1,782,000 for the six months ended September 30, 2021, a decrease from HKD 2,305,000 in the same period of 2020, reflecting a decline of approximately 22.7%[130]. - Contributions to retirement plans for key management personnel were HKD 49,000 for the six months ended September 30, 2021, down from HKD 67,000 in the previous year, showing a decrease of about 26.9%[130]. Cash Flow and Liquidity - The group's cash and bank balance decreased by approximately 46.2% to about HKD 2.1 million as of September 30, 2021, from HKD 3.9 million on March 31, 2021[13]. - Operating cash flow for the six months ended September 30, 2021, was HKD 2,051,000, compared to an outflow of HKD 1,408,000 for the same period in 2020[63]. - The net cash inflow from operating activities for the six months ended September 30, 2021, was approximately HKD 2,100,000, indicating an improvement in cash flow management[72]. - The company plans to continue improving its working capital management to generate sufficient cash flow to meet its obligations over the next twelve months[72]. Assets and Liabilities - Current liabilities net worth increased by approximately 20% to about HKD 3.0 million as of September 30, 2021, compared to HKD 2.5 million on March 31, 2021[13]. - Total assets as of September 30, 2021, were HKD 106,143,000, a decrease from HKD 111,213,000 as of March 31, 2021[56]. - The group’s net asset value decreased to HKD 23,346,000 as of September 30, 2021, down from HKD 27,898,000 as of March 31, 2021[57]. - Trade receivables as of September 30, 2021, amounted to HKD 799 million, down from HKD 982 million as of March 31, 2021, representing a decrease of approximately 18.6%[107]. - Trade payables increased significantly to HKD 1,026 million as of September 30, 2021, compared to HKD 361 million as of March 31, 2021, reflecting an increase of approximately 184.5%[110]. Financing and Debt - The debt-to-equity ratio as of September 30, 2021, was approximately 414.7%, up from 352.2% on March 31, 2021, due to increased bank borrowings and lease liabilities[15]. - Total bank borrowings as of September 30, 2021, were HKD 50,625 million, a slight decrease from HKD 50,750 million as of March 31, 2021, showing a reduction of about 0.25%[114]. - The effective interest rate for bank borrowings ranged from 2.06% to 3.00% as of September 30, 2021, compared to 2.13% to 3.00% as of March 31, 2021[117]. - The group reported total financing costs of HKD 1,612,000 for the six months ended September 30, 2021, down from HKD 1,757,000 in the same period of 2020[93]. Corporate Governance - The company maintained high standards of corporate governance and complied with the relevant provisions of the corporate governance code[30]. - The board confirmed compliance with the code of conduct for securities transactions by directors during the six months ended September 30, 2021[31]. - The company did not purchase, sell, or redeem any of its listed securities during the six months ended September 30, 2021[32]. Shareholder Information - As of September 30, 2021, the directors and senior management held significant interests in the company, with Mr. Chan Kwong Yuen holding approximately 74.74% of the shares through Profit Ocean Enterprises Limited[34]. - The company has granted 3,200,000 shares under the share option scheme, representing 0.89% of the total issued shares[44]. - As of September 30, 2021, a total of 30,900,000 share options were unexercised, with 28,650,000 remaining unexercised after accounting for cancellations and expirations[48]. - The group did not declare any dividends for the six months ended September 30, 2021, consistent with the previous year[24]. Government Support - The group received government subsidies totaling HKD 1,979,000 under the Employment Support Scheme to retain employees during the COVID-19 pandemic[88].

Financial Performance - Revenue for the three months ended June 30, 2021, was approximately HKD 7.54 million, an increase of about 21.0% compared to HKD 6.22 million for the same period in 2020[4] - Gross profit for the same period was approximately HKD 6.06 million, representing a 24.5% increase from HKD 4.88 million in the previous year, with a gross margin of approximately 80.5%[8] - The net loss for the reporting period was approximately HKD 1.81 million, a reduction from HKD 3.19 million in the same period last year, primarily due to increased gross profit and reduced administrative expenses[8] - The company reported a loss before tax of HKD 1,809,000, an improvement from a loss of HKD 3,193,000 in the previous year, representing a 43.3% reduction in losses[58] - Basic and diluted loss per share improved to HKD 0.50 from HKD 0.89, reflecting a 43.8% decrease in loss per share[58] - The total equity as of June 30, 2021, was HKD 26,325,000, down from HKD 36,512,000 a year earlier, reflecting accumulated losses[61] - The company reported a loss attributable to equity holders of HKD 1,809,000 for the three months ended June 30, 2021, compared to a loss of HKD 3,193,000 for the same period in 2020, representing a 43.4% improvement year-over-year[79] Administrative Expenses - Administrative expenses decreased by approximately 16.5% to about HKD 6.6 million from HKD 7.9 million in the previous year, mainly due to reduced rent and no stock option costs incurred[10] - Administrative expenses decreased to HKD 6,595,000 from HKD 7,908,000, indicating a cost reduction strategy[58] Cash Flow and Capital Management - Cash and bank balances as of June 30, 2021, were approximately HKD 3.9 million, a decrease of about 31.6% from HKD 5.7 million in the same period last year[14] - The company has adopted a prudent cash flow management approach to safeguard its assets amid uncertain economic conditions[11] Shareholder Information - As of June 30, 2021, the company has a total of 270,000,000 shares held by Profit Ocean Enterprises Limited, representing 74.74% of the total issued shares[34] - The beneficial ownership of 3,200,000 shares by directors represents approximately 0.89% of the total issued shares[34] - The major shareholders include Profit Ocean, Tri-Luck, Wealth City, and others, each holding 74.74% of the shares[41] - As of June 30, 2021, the total issued share capital of Profit Ocean is equally owned by Tri-Luck, Wealth City, Tianjing, and Coastal Lion, each holding 25%[45] - The company has a total of 30,900,000 unexercised options as of June 30, 2021, with 1,250,000 options exercised during the period[49] Compliance and Governance - The audit committee, consisting of all independent non-executive directors, reviewed the unaudited consolidated results for the three months ended June 30, 2021, and found them compliant with applicable accounting standards[53] - All directors confirmed compliance with the established code of conduct regarding securities trading for the three months ended June 30, 2021[28] - The compliance advisor, appointed on April 1, 2020, confirmed no interests that require disclosure under GEM Listing Rules as of June 30, 2021[56] Business Outlook and Strategy - The company maintains a cautious outlook on the business environment due to the unpredictable nature of the COVID-19 pandemic[11] - The company continues to focus on retail trade of tea products, with no new product launches or significant market expansion mentioned in the report[64] - The company has not disclosed any future performance guidance or outlook in the current report[36] Dividends and Securities - The company has no plans to declare any dividends for the three months ended June 30, 2021[20] - The company did not purchase, sell, or redeem any of its listed securities during the three months ended June 30, 2021[29] - The company did not declare any dividends for the three months ended June 30, 2021, consistent with the previous year[78] Employee Information - The company had 56 employees as of June 30, 2021, with total employee costs amounting to approximately HKD 3.2 million, slightly down from HKD 3.3 million in the previous year[17] Share Option Plan - The company has a stock option plan adopted on March 14, 2018, which is referenced in the ownership details[35] - The share option plan was approved on March 14, 2018, to incentivize selected participants for their contributions to the group[48] - The company aims to reward contributions from various stakeholders, including full-time employees, consultants, and business partners, through its share option plan[48]

Financial Performance - The total revenue for the year ended March 31, 2021, was approximately HKD 36.1 million, a slight decrease of 2.7% compared to HKD 37.1 million for the year ended March 31, 2020[11]. - The group recorded a loss attributable to owners of approximately HKD 9.1 million for the year ended March 31, 2021, compared to a loss of approximately HKD 12.3 million in the previous year[12]. - The group's consolidated revenue for the fiscal year ending March 31, 2021, was approximately HKD 36.1 million, a decrease of 2.7% from HKD 37.1 million in 2020[19]. - The annual gross profit was approximately HKD 27.8 million, down 2.1% from HKD 28.4 million in 2020, with a gross profit margin of 77.0%, slightly up from 76.5% in the previous year[19]. - The group experienced a net loss of approximately HKD 9.1 million, an improvement from a net loss of HKD 12.3 million in 2020, primarily due to the ongoing impact of COVID-19 and changes in accounting treatments[19]. - Other income increased from approximately HKD 17,000 in 2020 to about HKD 3.7 million in the reporting year, mainly due to retail industry support programs and government subsidies[21]. Cost Management - The group has reduced its operating costs by ceasing the operations of a subsidiary, which had recorded losses for two consecutive years, to improve cash flow[11]. - The board is committed to controlling costs, including reducing rent, advertising, and discretionary expenses[11]. - The group plans to maintain a prudent financial policy, primarily using cash generated from operations and proceeds from share issuance to meet liquidity needs[27]. Sales and Revenue Sources - Online sales through the HKTV Mall platform significantly increased, compensating for some of the sales losses from traditional stores and counters[12]. - Tea sales accounted for 92.6% of total revenue, up from 88.5% in 2020, with Pu-erh tea being the best-selling product, contributing 40.1% of total sales[20]. Legal Matters - The company has taken legal action against a software vendor for failing to deliver a defect-free ERP and POS system, seeking compensation for costs and losses incurred[13]. - The company has taken legal action against a software vendor for failure to deliver an ERP system on time, seeking compensation for costs and losses incurred[60]. Employee and Operational Changes - As of March 31, 2021, the group had 56 employees, a decrease from 71 employees in 2020, with total employee costs amounting to approximately HKD 14.6 million compared to HKD 16.2 million in 2020[40]. - The group has ceased operations of its tea-related beverage store in Tsim Sha Tsui as of March 31, 2021, due to the adverse effects of the COVID-19 pandemic[18]. - The company opened a new beverage store in Tsim Sha Tsui, utilizing approximately HKD 6.1 million of available funds as of March 31, 2021[50]. Financial Position - As of March 31, 2021, the company's current liabilities amounted to approximately HKD 2.5 million, a decrease of HKD 17.4 million or 116.8% compared to HKD 14.9 million in 2020[29]. - Cash and bank balances were approximately HKD 3.9 million, down HKD 1.9 million or 32.8% from HKD 5.8 million in 2020[29]. - The equity attributable to shareholders was approximately HKD 27.9 million, a decrease of HKD 8.6 million or 23.6% from HKD 36.5 million in 2020[35]. - The group's asset-to-liability ratio increased to 352.2% as of March 31, 2021, up from 284.0% in 2020, primarily due to increased bank loans and accumulated losses[43]. Environmental Impact - The company's electricity consumption decreased from 210,158 kWh in 2020 to 195,268 kWh in 2021, representing a reduction of approximately 7.5%[79]. - Carbon dioxide (CO₂) emissions decreased from 136.294 tons in 2020 to 107.954 tons in 2021, a decline of about 20.8%[76]. - The density of CO₂ emissions per square foot of office and factory space improved from 9 kg/sq ft in 2020 to 7 kg/sq ft in 2021, indicating a 22.2% reduction[76]. - The total paper consumption decreased from 55,000 sheets in 2020 to 52,500 sheets in 2021, a reduction of approximately 4.5%[79]. - The company reported a decrease in the consumption of packaging materials, with paper bag consumption dropping from 120,865 units in 2020 to 108,136 units in 2021, a decline of about 10.6%[83]. - The company has implemented energy-saving measures, including the use of LED lighting and encouraging employees to conserve resources, which contributed to reduced energy consumption[78]. - The company has not faced any fines or penalties for violating environmental regulations during the reporting year[75]. Corporate Governance - The board consists of 6 members, including 3 executive directors and 3 independent non-executive directors, ensuring a balanced governance structure[112]. - The company adheres to high standards of corporate governance and has complied with the GEM Listing Rules during the review period[109]. - The board is responsible for setting overall strategy and reviewing the group's operational and financial performance[111]. - The company has established a formal and transparent process for the selection, appointment, and reappointment of directors to ensure board composition changes do not cause undue disruption[139]. Risk Management - The internal control system is designed to manage risks rather than eliminate them entirely, providing reasonable assurance against significant misstatements or losses[152]. - The board is responsible for risk management and internal control systems, ensuring annual reviews of their effectiveness, considering changes in significant risks and the company's ability to respond[161]. - The company does not have an internal audit department; instead, it appoints external professionals to assess the adequacy and effectiveness of risk management and internal control systems, which is deemed more cost-effective[162]. Community Engagement - The group donated approximately HKD 5,000 in the reporting year to support community services and school education, a decrease from HKD 62,000 in 2020[107]. - The group actively promotes traditional tea culture through social media platforms, enhancing community engagement[107].

Financial Performance - For the three months ended December 31, 2020, the company reported revenue of HKD 14,946,000, a slight increase of 2.1% compared to HKD 14,647,000 for the same period in 2019[4] - The gross profit for the three months ended December 31, 2020, was HKD 11,687,000, representing a decrease of 0.3% from HKD 11,723,000 in the previous year[4] - The company recorded a net profit of HKD 1,616,000 for the three months ended December 31, 2020, compared to a profit of HKD 1,074,000 in the same period of 2019, marking a year-on-year increase of 50.5%[4] - For the nine months ended December 31, 2020, total revenue was HKD 28,214,000, down 7.9% from HKD 30,644,000 in the same period of 2019[4] - The company reported a net loss of HKD 3,974,000 for the nine months ended December 31, 2020, an improvement from a loss of HKD 5,177,000 in the previous year[4] - The group reported tea product sales of HKD 14,801,000 for the three months ended December 31, 2020, a slight increase from HKD 14,485,000 in the same period of 2019, while total sales for the nine months decreased to HKD 27,795,000 from HKD 29,993,000[18] - Other income for the nine months ended December 31, 2020, was HKD 3,719,000, significantly higher than HKD 476,000 in the same period of 2019, primarily due to government subsidies received[19] - The group reported a loss attributable to equity holders of HKD 3,974,000 for the nine months ended December 31, 2020, compared to a loss of HKD 5,177,000 in the same period of 2019[30] - The net loss for the nine months ended December 31, 2020, was approximately HKD 4.0 million, an improvement from a net loss of HKD 5.2 million in the previous year[35] Expenses and Cost Management - Administrative expenses decreased to HKD 24,897,000 for the nine months ended December 31, 2020, down from HKD 28,184,000 in the same period of 2019, reflecting a reduction of 11.4%[4] - The group’s bank interest income decreased to HKD 57,000 for the nine months ended December 31, 2020, down from HKD 257,000 in the same period of 2019[19] - The group incurred depreciation expenses of HKD 3,542,000 for property, plant, and equipment for the nine months ended December 31, 2020, compared to HKD 691,000 in the same period of 2019[25] - The group’s total rental expenses for short-term leases amounted to HKD 5,968,000 for the nine months ended December 31, 2020, down from HKD 8,538,000 in the same period of 2019[25] - Administrative expenses decreased by 11.7% to approximately HKD 6.0 million, down from HKD 11.7 million in the same period last year, due to reduced rental payments and other cost-cutting measures[38][50] Equity and Shareholder Information - The total equity of the company as of December 31, 2020, was HKD 33,066,000, down from HKD 41,232,000 as of April 1, 2020, reflecting a decrease of 19.8%[6] - As of December 31, 2020, the company had significant shareholdings, with Profit Ocean holding 270,000,000 shares, representing 75% of the issued share capital[70] - The directors and senior management held interests in the company's shares, with each director holding 270,000,000 shares in a controlled corporation, equating to 75%[62] - The company’s major shareholders include Profit Ocean, Tri-Luck, Wealth City, and others, each holding 270,000,000 shares, which is 75% of the total issued shares[70] - The interests of directors and senior management in associated corporations were disclosed, with each holding 250 shares in Profit Ocean, representing 25%[68] Corporate Governance and Compliance - The company maintained high standards of corporate governance and complied with all relevant provisions of the corporate governance code as of December 31, 2020[58] - All directors confirmed compliance with the code of conduct for securities transactions during the nine months ending December 31, 2020[59] - The audit committee, consisting of independent non-executive directors, has reviewed the unaudited consolidated results for the nine months ended December 31, 2020, and found them compliant with applicable accounting standards[83] - The company has appointed a compliance advisor to provide guidance on compliance with GEM listing rules as of April 1, 2020[84] Future Outlook and Market Conditions - The company has not disclosed specific future outlook or guidance in the report, focusing instead on current performance metrics[4] - The ongoing COVID-19 pandemic and related restrictions have led to a cautious outlook, with a noted 25.3% decline in retail sales value in Hong Kong for the first 11 months of 2020 compared to the same period in 2019[39] Stock Options and Incentives - The company has a stock option plan adopted on March 14, 2018, which granted options leading to the beneficial ownership of 3,200,000 shares by certain directors, representing 0.89%[65] - As of December 31, 2020, a total of 31,550,000 stock options were granted under the stock option plan, with an exercise price of HKD 0.189[79] - The stock options granted include 3,200,000 shares for director Chen Guangyuan, which remain unexercised as of December 31, 2020[79] - The stock option plan aims to incentivize selected participants, including full-time employees and consultants, for their contributions to the group[77] - A total of 650,000 stock options with an exercise price of HKD 0.189 were canceled due to employee resignations and retirements after the reporting period[79] Debt and Financial Obligations - The debt-to-equity ratio increased to approximately 257.3% as of December 31, 2020, up from 231.1% as of March 31, 2020, due to increased bank borrowings[43] - The company has not violated any significant loan agreements related to its business operations as of December 31, 2020[76] - The company has not provided any financial assistance or guarantees to its affiliates as of December 31, 2020[76] - No shares were pledged by the controlling shareholders to any parties as of December 31, 2020[76] Product Development and Market Strategy - There is no mention of new product development, market expansion, or mergers and acquisitions in the current report[4] - The company has not disclosed any new product developments or market expansion strategies in the provided documents[61]

Financial Performance - The group's revenue for the six months ended September 30, 2020, was approximately HKD 13.3 million, a decrease of about 16.9% compared to HKD 15.997 million for the same period in 2019[5]. - Gross profit for the same period was approximately HKD 10.2 million, down about 16.4% from HKD 12.183 million in 2019, with a gross margin of approximately 76.7%, slightly up from 76.3% in the previous year[9]. - The net loss for the period was approximately HKD 5.6 million, compared to a net loss of HKD 6.3 million in the same period last year, primarily due to economic difficulties arising from the COVID-19 outbreak[9]. - For the six months ended September 30, 2020, the company reported total revenue of HKD 13,268,000, with a gross profit of HKD 10,232,000[72]. - The company incurred a loss before tax of HKD 5,592,000 for the six-month period, with a basic and diluted loss per share of HKD 1.55[72]. - The company reported a net loss of HKD 5,592,000 for the six months ended September 30, 2020, compared to a net loss of HKD 6,251,000 for the same period in 2019, indicating an improvement of approximately 10.5%[76]. Assets and Liabilities - The group's current assets as of September 30, 2020, were approximately HKD 10.7 million, a decrease of about 28.2% from HKD 14.9 million as of March 31, 2020[14]. - Cash and bank balances were approximately HKD 2.0 million, down about 65.5% from HKD 5.8 million as of March 31, 2020[14]. - The company's total equity decreased to HKD 31,448,000 as of September 30, 2020, down from HKD 36,512,000 as of March 31, 2020, a decline of approximately 13.8%[74]. - The company reported a decrease in total liabilities to HKD 90,183,000 as of September 30, 2020, down from HKD 89,876,000 as of March 31, 2020, indicating a slight reduction of approximately 0.3%[74]. - The company's long-term bank borrowings rose to HKD 45,625,000 as of September 30, 2020, compared to HKD 42,750,000 as of March 31, 2020, an increase of approximately 6.5%[74]. Cash Flow and Financing - The group adopted a prudent cash flow management approach to safeguard its assets amid uncertain economic conditions[13]. - The financing activities resulted in a net cash outflow of HKD 13,384,000 for the six months ended September 30, 2020[80]. - The effective interest rate on borrowings ranged from 2.75% to 3.00% as of September 30, 2020, compared to 3.00% to 4.02% as of March 31, 2020[161]. - The group recognized a total of HKD 4,000,000 in unsecured borrowings guaranteed by the controlling shareholder as of September 30, 2020[160]. Employee and Operational Costs - As of September 30, 2020, the total employee costs amounted to approximately HKD 5.9 million, a decrease from HKD 7.1 million for the same period in 2019, reflecting a reduction of about 16.9%[22]. - The group received approximately HKD 2.0 million in subsidies from the Employment Support Scheme, which helped alleviate the financial burden of employee costs[22]. - Administrative expenses for the six months were HKD 15,785,000, reflecting a significant cost structure[72]. - Total remuneration for key management personnel was HKD 2,305,000 for the six months ended September 30, 2020, compared to HKD 1,945,000 in 2019, representing an 18.5% increase[16]. Shareholder Information - Major shareholders hold 270,000,000 shares each, representing 75% of the total issued shares[47]. - A total of 3,200,000 shares are granted under the share option scheme, accounting for 0.89% of the total issued shares[50]. - The share option plan aims to incentivize selected participants, including full-time employees and consultants, to contribute to the group[62]. Government Support and Subsidies - Other income increased from HKD 0.4 million to HKD 2.7 million, representing a growth of approximately 575.0%, attributed to government support measures during the economic downturn[9]. - The group recognized government subsidies totaling HKD 2,539,000 under the Employment Support Scheme to retain employees during the COVID-19 pandemic, compared to zero in the same period last year[113]. Corporate Governance - The board is committed to maintaining high standards of corporate governance and has complied with relevant codes as of September 30, 2020[28]. - The company established an audit committee to oversee financial reporting and risk management, consisting of independent non-executive directors[66]. - The company appointed a compliance advisor on April 1, 2020, to ensure adherence to GEM listing rules[67]. Market and Revenue Breakdown - For the six months ended September 30, 2020, the sales revenue from tea products was HKD 12,994,000, a decrease of 16.2% compared to HKD 15,508,000 in the same period of 2019[103]. - The revenue from food and beverage retail for the same period was HKD 274,000, down 44% from HKD 489,000 in 2019[103]. - All revenue generated by the company comes from Hong Kong, with no single customer contributing more than 10% of total revenue during the interim period[105].

Financial Performance - The group's consolidated revenue for the three months ended June 30, 2020, was approximately HKD 6.2 million, a decrease of about 27.0% compared to HKD 8.5 million in 2019[7] - Gross profit for the same period was approximately HKD 4.9 million, down about 24.2% from HKD 6.4 million in 2019, with a gross profit margin of approximately 78.5%, slightly up from 75.6% in the previous year[7] - The net loss for the reporting period was approximately HKD 3.2 million, compared to a net loss of approximately HKD 3.0 million in 2019[7] - For the three months ended June 30, 2020, the company reported total revenue of HKD 6,222,000 and a gross profit of HKD 4,883,000[61] - The company incurred a loss before tax of HKD 3,193,000 for the same period, resulting in a loss per share of HKD 0.89[61] - As of June 30, 2020, the total equity of the company was HKD (17,134,000), reflecting an increase in accumulated losses[62] - The company reported a loss attributable to equity holders of HKD 3,193,000 for the three months ended June 30, 2020, compared to a loss of HKD 3,047,000 in the same period of 2019, indicating an increase in loss of approximately 4.8% year-over-year[88] Revenue Breakdown - Revenue from tea products for the three months ended June 30, 2020, was HKD 6,090,000, a decrease of 26.5% compared to HKD 8,300,000 for the same period in 2019[76] - Revenue from food and beverage retail for the same period was HKD 132,000, down 41.1% from HKD 224,000 in 2019[76] - Total revenue for the group for the three months ended June 30, 2020, was HKD 6,222,000, a decline of 27.0% from HKD 8,524,000 in 2019[76] - Other income for the period included government subsidies of HKD 1,055,000 received under the "Anti-epidemic Fund" during the COVID-19 outbreak[77] Expenses and Costs - Selling and distribution costs decreased by approximately 38.4% to about HKD 0.2 million, primarily due to reduced advertising expenses[8] - Administrative expenses decreased from approximately HKD 9.2 million for the three months ended June 30, 2019, to about HKD 7.9 million, a reduction of about 14.2%[12] - The cost of inventories recognized as an expense for the period was HKD 1,065,000, down 39.5% from HKD 1,764,000 in 2019[81] - Depreciation of property, plant, and equipment for the period was HKD 1,130,000, significantly higher than HKD 194,000 in the same period last year[81] Cash and Capital Management - Cash and bank balances were approximately HKD 5.7 million as of June 30, 2020, a decrease of about HKD 0.1 million or 1.5% from HKD 5.8 million on March 31, 2020[14] - Capital expenditure for the three months ended June 30, 2020, was approximately HKD 6,300, primarily for upgrading office equipment[17] - The group intends to allocate more unutilized funds for general working capital to respond flexibly to uncertainties in the retail market[19] Dividends and Shareholder Information - The board has resolved not to declare any interim dividend for the three months ended June 30, 2020[18] - The board does not recommend the payment of any dividend for the three months ended June 30, 2020[87] - As of June 30, 2020, the directors and senior management held a total of 270,000,000 shares, representing 75% ownership in the company[31] - The company’s shareholding structure indicates that the major shareholders collectively own 75% of the issued share capital through Profit Ocean Enterprises Limited[40] Compliance and Governance - The company has adopted a set of code of conduct for securities trading by directors, confirming compliance with the standards set forth in GEM Listing Rules from April 1, 2020, to June 30, 2020[25] - The audit committee reviewed the financial results for the quarter and confirmed compliance with applicable accounting standards[53] - The company appointed a compliance advisor on April 1, 2020, to ensure adherence to GEM listing rules[56] - There were no significant related party transactions reported for the three months ended June 30, 2020[51] Strategic Outlook - The group plans to adopt a cautious approach in opening new stores and counters, aiming to maximize the contribution profit from existing locations due to the uncertain economic environment[13] - The company’s management discussed the performance and outlook during the earnings call, emphasizing the need for strategic adjustments in response to market conditions[45] Share Options and Securities - The share option scheme aims to incentivize selected participants, including full-time employees and directors, with a total of 10,200,000 options granted during the period[27] - The total number of options exercised during the period was 32,300,000, with a remaining balance of 31,550,000 options as of June 30, 2020[30] - The share option plan was conditionally approved on March 14, 2018, and further details are available in the prospectus[27] - No additional interests or holdings were reported by directors or senior executives beyond those already disclosed[39] - The company has not disclosed any new products or technologies in the recent reports[28] - There are no significant market expansion or acquisition strategies mentioned in the current financial reports[28] - The company did not provide any financial assistance or guarantees to any controlling shareholders during the three months ended June 30, 2020[52] - The company has not pledged any shares to any contracting parties as of June 30, 2020[50]

YING KEE TEA HOUSE GROUP LIMITED 英記茶莊集團有限公司 （於香港註冊成立的有限公司） 股份代號 : 8241 | --- | --- | --- | --- | --- | |-------|-------|-------|-------|-------| | | | | | | | | | | | | 香港聯合交易所有限公司（「聯交所」）GEM 之特色 GEM的定位，乃為相比起其他在聯交所上市的公司帶有較高投資風險的中 小型公司提供一個上市的市場。有意投資者應了解投資該等公司的潛在風 險，並應經過審慎周詳考慮後方可作出投資決定。 由於GEM上市公司普遍為中小型公司，在GEM買賣的證券可能會較於聯交 所主板買賣的證券承受較高的市場波動風險，且無法保證在GEM買賣的證 券會有高流通量的市場。 香港交易及結算所有限公司及聯交所對本報告的內容概不負責，對其準確性 或完整性亦不發表任何聲明，並明確表示概不會就本報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。 英記茶莊集團有限公司（「本公司」）董事（「董事」）願共同及個別對本報告 承擔全部責任。本報告乃遵照G ...

[Report Cover](index=1&type=section&id=%E6%8A%A5%E5%91%8A%E5%B0%81%E9%9D%A2) - This report is the third quarterly results report for the 2019/2020 financial year of Wing Kee Tea House Group Limited (Stock Code: 8241)[1](index=1&type=chunk) [GEM Listing Characteristics and Disclaimer](index=2&type=section&id=GEM%E4%B8%8A%E5%B8%82%E7%89%B9%E8%89%B2%E5%8F%8A%E5%85%8D%E8%B4%A3%E5%A3%B0%E6%98%8E) - The GEM market is positioned to provide a listing platform for small and medium-sized companies, involving higher investment risks, and investors should exercise caution[2](index=2&type=chunk) - Hong Kong Exchanges and Clearing Limited and the Stock Exchange take no responsibility for the contents of this report and make no statement as to its accuracy or completeness[2](index=2&type=chunk) - The Company's directors jointly and severally accept full responsibility for the information in this report, confirming it is accurate, complete, and free from misleading or fraudulent statements[2](index=2&type=chunk) [Third Quarterly Results](index=3&type=section&id=%E7%AC%AC%E4%B8%89%E5%AD%A3%E5%BA%A6%E4%B8%9A%E7%BB%A9) [Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=%E6%9C%AA%E7%BB%8F%E5%AE%A1%E6%A0%B8%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%8D%9F%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the nine months ended December 31, 2019, the Group's revenue and gross profit decreased year-on-year, turning from profit to loss, with a net loss of HKD 5,177 thousand and a loss per share of HKD 1.44 cents Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the nine months ended December 31) | Indicator | 2019 (Thousand HKD) | 2018 (Thousand HKD) | Change (YoY) | | :--------------------------------------------------- | :------------------ | :------------------ | :----------- | | Revenue | 30,644 | 34,701 | -11.7% | | Cost of Sales | (6,738) | (7,464) | -9.7% | | Gross Profit | 23,906 | 27,237 | -12.2% | | Other Income | 476 | 464 | +2.6% | | Selling and Distribution Costs | (1,284) | (1,566) | -18.1% | | Administrative Expenses | (28,184) | (26,508) | +6.3% | | Finance Costs | (56) | (46) | +21.7% | | Profit/(Loss) Before Income Tax | (5,142) | (419) | -1127.2% | | Income Tax Expense | (35) | (934) | -96.3% | | Profit/(Loss) and Total Comprehensive Income/(Expense) for the Period | (5,177) | (1,353) | -282.6% | | Basic and Diluted Earnings/(Loss) Per Share (HK cents) | (1.44) | (0.38) | -278.9% | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the three months ended December 31) | Indicator | 2019 (Thousand HKD) | 2018 (Thousand HKD) | Change (YoY) | | :--------------------------------------------------- | :------------------ | :------------------ | :----------- | | Revenue | 14,647 | 17,679 | -17.2% | | Cost of Sales | (2,924) | (3,713) | -21.2% | | Gross Profit | 11,723 | 13,966 | -16.0% | | Other Income | 84 | 120 | -30.0% | | Selling and Distribution Costs | (663) | (832) | -20.3% | | Administrative Expenses | (10,015) | (8,462) | +18.3% | | Finance Costs | (20) | – | N/A | | Profit/(Loss) Before Income Tax | 1,109 | 4,792 | -76.8% | | Income Tax Expense | (35) | (926) | -96.2% | | Profit/(Loss) and Total Comprehensive Income/(Expense) for the Period | 1,074 | 3,866 | -72.2% | | Basic and Diluted Earnings/(Loss) Per Share (HK cents) | 0.30 | 1.07 | -71.9% | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=4&type=section&id=%E6%9C%AA%E7%BB%8F%E5%AE%A1%E6%A0%B8%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%9D%83%E7%9B%8A%E5%8F%98%E5%8A%A8%E8%A1%A8) For the nine months ended December 31, 2019, the Group's total equity decreased to HKD 37,042 thousand, primarily due to a loss of HKD 5,177 thousand for the period, offset by a new share option reserve of HKD 987 thousand Condensed Consolidated Statement of Changes in Equity (For the nine months ended December 31) | Indicator | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :------------------------ | :------------------ | :------------------ | | Share Capital | 41,879 | 41,879 | | Capital Reserve | 990 | 990 | | Share Option Reserve | 987 | – | | (Accumulated Losses)/Retained Profits | (6,814) | (238) | | **Total Equity** | **37,042** | **42,631** | - As of April 1, 2019, audited total equity was **HKD 41,232 thousand**, with a loss of **HKD 5,177 thousand** for the period, resulting in total equity decreasing to **HKD 37,042 thousand** as of December 31, 2019[6](index=6&type=chunk) - The issuance of equity-settled share-based payments in 2019 led to an increase in share option reserve by **HKD 987 thousand**[6](index=6&type=chunk) [Notes to the Unaudited Condensed Consolidated Financial Statements](index=5&type=section&id=%E6%9C%AA%E7%BB%8F%E5%AE%A1%E6%A0%B8%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8%E9%99%84%E6%B3%A8) [1. General Information](index=5&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B5%84%E6%96%99) Wing Kee Tea House Group Limited was incorporated in Hong Kong on September 14, 2017, listed on GEM on April 16, 2018, primarily retailing Chinese tea, tea sets, and tea gift boxes in Hong Kong, and operating food and beverage retail under the 'Oi Cha' brand - The Company was incorporated in Hong Kong on **September 14, 2017**, and listed on GEM on **April 16, 2018**[8](index=8&type=chunk)[9](index=9&type=chunk) - The Group's principal activities are the retail of Chinese tea, tea sets, and tea gift boxes in Hong Kong, and the retail of food and beverages such as Hong Kong-style coffee, fruit, and bubble tea under the name 'Oi Cha'[9](index=9&type=chunk) [2. Basis of Preparation](index=5&type=section&id=2.%20%E7%BC%96%E5%88%B6%E5%9F%BA%E5%87%86) The Group's unaudited condensed consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards and GEM Listing Rules, on a historical cost basis, with HKD as the functional currency, and have been reviewed by the Audit Committee - The financial statements are prepared in accordance with all applicable Hong Kong Financial Reporting Standards and the GEM Listing Rules[10](index=10&type=chunk) - The statements are prepared on a historical cost basis, with the functional currency being Hong Kong Dollars, and all values are rounded to the nearest thousand HKD[10](index=10&type=chunk) - The statements have not been audited by an independent auditor but have been reviewed by the Company's Audit Committee[11](index=11&type=chunk) [3. Adoption of New and Revised Hong Kong Financial Reporting Standards](index=6&type=section&id=3.%20%E9%87%87%E7%BA%B3%E6%96%B0%E8%AE%A2%E5%8F%8A%E7%BB%8F%E4%BF%AE%E8%AE%A2%E9%A6%99%E6%B8%AF%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A%E5%87%86%E5%88%99) The Group first applied new and revised Hong Kong Financial Reporting Standards during this period, with HKFRS 16 'Leases' having a significant impact on the financial statements, leading to the recognition of right-of-use assets and lease liabilities [HKFRS 16 'Leases'](index=6&type=section&id=%E9%A6%99%E6%B8%AF%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A%E5%87%86%E5%88%99%E7%AC%AC16%E5%8F%B7%E3%80%8C%E7%A7%9F%E8%B3%83%E3%80%8D) The adoption of HKFRS 16 'Leases' resulted in the Group recognizing lease liabilities of HKD 1,896 thousand and measuring right-of-use assets, with no restatement of prior periods - The adoption of HKFRS 16 'Leases' has a significant impact on the preparation and presentation of the Group's results and financial position for the current and prior periods[13](index=13&type=chunk) - The Group has elected to apply the modified retrospective approach, recognizing the cumulative effect of adopting HKFRS 16 in equity[14](index=14&type=chunk) Reconciliation of Lease Liabilities (As of April 1, 2019) | Indicator | Thousand HKD | | :------------------------------------------------------------------ | :----------- | | Total operating lease commitments disclosed as at March 31, 2019 | 4,590 | | Recognition exemption – leases with remaining lease term of 12 months or less | (2,638) | | Operating lease liabilities before discounting | 1,952 | | Discounted using the incremental borrowing rate as at April 1, 2019 | (56) | | **Total lease liabilities recognized under HKFRS 16 as at April 1, 2019** | **1,896** | | Classified as: Current lease liabilities | 1,896 | [4. Revenue](index=7&type=section&id=4.%20%E6%94%B6%E7%9B%8A) For the nine months ended December 31, 2019, the Group's total revenue was HKD 30,644 thousand, primarily from tea product sales, with food and beverage retail contributing HKD 651 thousand Revenue Composition (For the nine months ended December 31) | Revenue Source | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :------------------- | :------------------ | :------------------ | | Sales of tea products | 29,993 | 34,701 | | Food and beverage retail | 651 | – | | **Total Revenue** | **30,644** | **34,701** | Revenue Composition (For the three months ended December 31) | Revenue Source | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :------------------- | :------------------ | :------------------ | | Sales of tea products | 14,485 | 17,679 | | Food and beverage retail | 162 | – | | **Total Revenue** | **14,647** | **17,679** | - Total revenue for the nine months of 2019 decreased by **11.7%** year-on-year, primarily due to reduced sales of tea products[18](index=18&type=chunk) [5. Profit/(Loss) Before Income Tax](index=8&type=section&id=5.%20%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%8E%E5%89%8D%E6%BA%A2%E5%88%A9%EF%BC%8F%EF%BC%88%E4%BA%8F%E6%8D%9F%EF%BC%89) For the nine months ended December 31, 2019, the Group's loss before income tax was HKD 5,142 thousand, mainly impacted by new expenses such as depreciation of right-of-use assets, short-term lease expenses, and variable lease payments Items for Profit/(Loss) Before Income Tax Calculation (For the nine months ended December 31) | Item | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :----------------------------------------- | :------------------ | :------------------ | | Auditor's remuneration | 300 | 245 | | Cost of inventories recognized as expense | 5,798 | 6,471 | | Depreciation of property, plant and equipment | 691 | 429 | | Depreciation of right-of-use assets | 1,037 | – | | Operating lease expenses (short-term leases and variable rents) | 8,857 | 7,004 | | Listing expenses | – | 4,000 | - For the nine months of 2019, new depreciation of right-of-use assets amounted to **HKD 1,037 thousand**, short-term lease expenses and leases with terms of less than 12 months amounted to **HKD 8,538 thousand**, and variable lease payments were **HKD 319 thousand**[20](index=20&type=chunk) - Listing expenses of **HKD 4,000 thousand** were incurred in the nine months of 2018, with no such expenses in the corresponding period of 2019[20](index=20&type=chunk) [6. Income Tax Expense](index=9&type=section&id=6.%20%E6%89%80%E5%BE%97%E7%A8%8E%E5%BC%80%E6%94%AF) For the nine months ended December 31, 2019, the Group's income tax expense was HKD 35 thousand, significantly lower than HKD 934 thousand in the prior year, primarily due to reduced taxable profit Income Tax Expense (For the nine months ended December 31) | Tax Type | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :--------------- | :------------------ | :------------------ | | Hong Kong Profits Tax | 35 | 934 | - Hong Kong profits tax is provided at a rate of **16.5%**, with one subsidiary's first **HKD 2,000,000** of assessable profits taxed at **8.25%**[22](index=22&type=chunk) - As of December 31, 2019, the Group had no significant unrecognized deferred tax assets and liabilities[23](index=23&type=chunk) [7. Dividends](index=9&type=section&id=7.%20%E8%82%A1%E6%81%AF) The Board resolved not to declare any dividends for the nine months ended December 31, 2019, consistent with the prior year - For the nine months ended December 31, 2019, the Board did not declare any dividends[24](index=24&type=chunk) [8. Earnings/(Loss) Per Share](index=10&type=section&id=8.%20%E6%AF%8F%E8%82%A1%E6%BA%A2%E5%88%A9%EF%BC%8F%EF%BC%88%E4%BA%8F%E6%8D%9F%EF%BC%89) For the nine months ended December 31, 2019, the loss attributable to equity holders of the Company was HKD 5,177 thousand, resulting in a basic and diluted loss per share of HKD 1.44 cents Earnings/(Loss) Per Share Calculation (For the nine months ended December 31) | Indicator | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :--------------------------------------------------- | :------------------ | :------------------ | | Profit/(Loss) attributable to equity holders of the Company for the period | (5,177) | (1,353) | | Weighted average number of ordinary shares (Thousand shares) | 360,000 | 356,073 | | Basic and Diluted Earnings/(Loss) Per Share (HK cents) | (1.44) | (0.38) | - For the nine months ended December 31, 2019, the effect of the exercise of share options on potential diluted shares was anti-dilutive and therefore not considered[27](index=27&type=chunk) [Management Discussion and Analysis](index=11&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%82%E8%AE%A8%E8%AE%BA%E5%8F%8A%E5%88%86%E6%9E%90) [Financial Summary](index=11&type=section&id=%E8%B4%A2%E5%8A%A1%E6%91%98%E8%A6%81) For the nine months ended December 31, 2019, the Group's revenue, gross profit, and profit/loss attributable to shareholders all decreased year-on-year, with net loss expanding to HKD 5.177 million Financial Summary (For the nine months ended December 31) | Indicator | 2019 (Thousand HKD) | 2018 (Thousand HKD) | | :------------------------------ | :------------------ | :------------------ | | Revenue | 30,644 | 34,701 | | Gross Profit | 23,906 | 27,237 | | Loss Before Tax | (5,142) | (419) | | Income Tax Expense | (35) | (934) | | Profit/(Loss) Attributable to Shareholders | (5,177) | (1,353) | | Loss Per Share (HK cents) | (1.44) | (0.38) | [Business Review](index=11&type=section&id=%E4%B8%9A%E5%8A%A1%E5%9B%9E%E9%A1%BE) The Company, as an investment holding company, has its subsidiary Wing Kee Tea House Limited primarily selling tea, tea sets, and tea gift boxes through 12 retail outlets, while another subsidiary, Oi Cha Wing Kee Limited, sells Chinese tea and other beverages through one store - Wing Kee Tea House Limited sells tea, tea sets, and tea gift boxes through **12** retail stores and counters[31](index=31&type=chunk) - Oi Cha Wing Kee Limited sells Chinese tea, Italian coffee, fruit, and other ingredient beverages through **one** store[31](index=31&type=chunk) [Financial Review](index=11&type=section&id=%E8%B4%A2%E5%8A%A1%E5%9B%9E%E9%A1%BE) During the reporting period, the Group's revenue and gross profit both decreased, and net loss expanded, primarily due to social events and economic uncertainties in Hong Kong. Selling and distribution costs decreased, but administrative expenses rose due to increased staff salaries, depreciation, and rent [Revenue, Gross Profit and Net Loss](index=11&type=section&id=%E6%94%B6%E7%9B%8A%E3%80%81%E6%AF%9B%E5%88%A9%E5%8F%8A%E5%87%80%E4%BA%8F%E6%8D%9F) For the nine months ended December 31, 2019, the Group's revenue decreased by 11.7% to HKD 30.6 million, gross profit decreased by 12.2% to HKD 23.9 million, and net loss expanded to HKD 5.2 million, primarily attributed to large-scale protests and economic recession in Hong Kong - Consolidated revenue for the reporting period was approximately **HKD 30.6 million**, a year-on-year decrease of approximately **11.7%**[32](index=32&type=chunk) - Gross profit was approximately **HKD 23.9 million**, a year-on-year decrease of approximately **12.2%**; gross profit margin was approximately **78.0%**, a slight year-on-year decrease of **0.5%**[32](index=32&type=chunk) - Net loss was approximately **HKD 5.2 million**, primarily due to revenue contraction caused by large-scale protests in Hong Kong and weak consumer sentiment triggered by social events[32](index=32&type=chunk) [Selling and Distribution Costs](index=12&type=section&id=%E9%94%80%E5%94%AE%E5%8F%8A%E5%88%86%E9%94%80%E6%88%90%E6%9C%AC) Selling and distribution costs decreased by 18.0% to HKD 1.3 million, mainly benefiting from reduced entertainment expenses and sales commissions post-listing, but partially offset by increased social media advertising expenses - Selling and distribution costs decreased by approximately **18.0%** to approximately **HKD 1.3 million**[34](index=34&type=chunk) - The decrease was primarily due to reduced entertainment expenses after listing and lower contractual sales commissions for sales employees[34](index=34&type=chunk) - Part of the decrease was offset by increased advertising development and maintenance expenses for Facebook, Instagram, and WeChat[34](index=34&type=chunk) [Administrative Expenses](index=12&type=section&id=%E8%A1%8C%E6%94%BF%E5%BC%80%E6%94%AF) Administrative expenses increased year-on-year, mainly due to higher staff salaries from hiring store assistants, depreciation of right-of-use assets from HKFRS 16 adoption, increased depreciation of fixed assets and rent due to new stores, and share option compensation expenses - Staff salaries increased by approximately **11.9%** to approximately **HKD 8.9 million**, due to hiring store assistants for the Sha Tin counter and Oi Cha store[35](index=35&type=chunk) - New depreciation of right-of-use assets amounted to approximately **HKD 1.0 million**, due to the implementation of HKFRS 16[35](index=35&type=chunk) - Depreciation of fixed assets increased by approximately **61.1%** to approximately **HKD 0.7 million**, and rent increased by approximately **30.8%** to approximately **HKD 9.2 million**, both due to the new Sha Tin counter and Oi Cha store[35](index=35&type=chunk) - New share option compensation expenses amounted to approximately **HKD 1.0 million**[35](index=35&type=chunk) - The increased administrative expenses were offset by listing expenses of approximately **HKD 4.0 million** incurred in the corresponding period of 2018[36](index=36&type=chunk) [Outlook and Prospects](index=13&type=section&id=%E5%B1%95%E6%9C%9B%E5%8F%8A%E5%89%8D%E6%99%AF) The Group faces severe challenges from global economic recession and ongoing social unrest in Hong Kong, anticipating stagnant or negative growth. Prudent cash management measures have been adopted, including rent negotiations and discretionary spending cuts. Part of the IPO proceeds were used for new store openings and system upgrades, but further retail store openings are deferred given market conditions - With global economic recession and ongoing social unrest in Hong Kong, the Group faces stagnant or negative growth[39](index=39&type=chunk) - Prudent cash management strategies have been adopted, including negotiating rent reductions and cutting discretionary expenses such as advertising, entertainment, and incentive bonuses[39](index=39&type=chunk) - Approximately **HKD 25.2 million** of the IPO proceeds have been used for opening the Sha Tin counter, Tsim Sha Tsui store, office and warehouse renovation, information system upgrades, hiring new staff, and repaying bank loans of approximately **HKD 3.8 million**[40](index=40&type=chunk) - Given the current market conditions, the Group has deferred opening the other two retail stores mentioned in the prospectus[40](index=40&type=chunk) [Liquidity and Cash Flow Management](index=13&type=section&id=%E6%B5%81%E5%8A%A8%E8%B5%84%E9%87%91%E5%8F%8A%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E7%AE%A1%E7%90%86) The Group's liquidity primarily stems from cash generated from operations and proceeds from share offerings. As of December 31, 2019, both net current assets and cash and bank balances decreased, while the current ratio remained at a high level - The Group primarily funds its liquidity and capital requirements through cash generated from operations and proceeds from share offerings[41](index=41&type=chunk) Liquidity Position (As of December 31) | Indicator | 2019 (Thousand HKD) | March 31, 2019 (Thousand HKD) | Change | | :------------------------------- | :------------------ | :---------------------------- | :------- | | Net Current Assets | 32,500 | 37,700 | -13.8% | | Cash and Bank Balances | 8,200 | 10,200 | -19.5% | | Current Assets | 34,300 | 39,200 | -12.5% | | Current Liabilities | 1,800 | 1,500 | +20.0% | | Current Ratio | 18.7 times | 26.4 times | -29.2% | - Net current assets decreased by approximately **HKD 5.2 million**, primarily due to the withdrawal of cash and bank balances for working capital purposes[41](index=41&type=chunk) [Gearing Ratio](index=14&type=section&id=%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E6%AF%94%E7%8E%87) As of December 31, 2019, the Group's gearing ratio increased to 13.6%, primarily due to a decrease in retained profits - As of December 31, 2019, the gearing ratio was approximately **13.6%**, higher than **7.8%** as of March 31, 2019[44](index=44&type=chunk) - The increase in gearing ratio was primarily due to a decrease in retained profits[44](index=44&type=chunk) [Capital Expenditure](index=14&type=section&id=%E8%B5%84%E6%9C%AC%E5%BC%80%E6%94%AF) For the nine months ended December 31, 2019, the Group's capital expenditure was approximately HKD 1.9 million, mainly for furniture and fixtures for new counters and beverage stores - For the nine months ended December 31, 2019, capital expenditure was approximately **HKD 1.9 million**, slightly lower than **HKD 2.0 million** in the corresponding period last year[45](index=45&type=chunk) - Capital expenditure was primarily for furniture and fixtures for new counters and beverage stores[45](index=45&type=chunk) [Foreign Exchange Risk](index=14&type=section&id=%E5%A4%96%E6%B1%87%E9%A3%8E%E9%99%A9) The Group's principal operations and assets and liabilities are denominated in HKD, resulting in insignificant foreign exchange risk, with no hedging instruments employed - All of the Group's assets and liabilities are located in Hong Kong and denominated in HKD, and almost all revenue is derived from Hong Kong, resulting in insignificant foreign exchange risk[46](index=46&type=chunk) - No hedging instruments are used for RMB purchase payments, as they represent a small portion of total purchases and settlement within **60 days** does not give rise to significant foreign exchange risk[46](index=46&type=chunk) [Key Risks and Uncertainties](index=14&type=section&id=%E4%B8%BB%E8%A6%81%E9%A3%8E%E9%99%A9%E5%8F%8A%E4%B8%8D%E6%98%8E%E6%9C%97%E5%9B%A0%E7%B4%A0) The Group faces credit, interest rate, and liquidity risks, but manages these through stringent credit reviews, absence of bank borrowings, and cash flow forecasts [Credit Risk](index=14&type=section&id=%E4%BF%A1%E8%B4%B7%E9%A3%8E%E9%99%A9) The Group only transacts with reputable third parties and conducts stringent credit reviews for credit customers, resulting in immaterial bad debt risk - The Group only transacts with approved and reputable third parties[47](index=47&type=chunk) - Credit terms are subject to stringent credit review procedures, and receivable balances are continuously monitored, resulting in immaterial bad debt risk[47](index=47&type=chunk) [Interest Rate Risk](index=14&type=section&id=%E5%88%A9%E7%8E%87%E9%A3%8E%E9%99%A9) The Group had no bank borrowings at the end of the reporting period, thus no interest rate risk arising from borrowings - As of December 31, 2019, the Group had no bank borrowings, thus no interest rate risk arising from borrowings[48](index=48&type=chunk) - The risks arising from commercial bank deposits are not significant or immediate[48](index=48&type=chunk) [Liquidity Risk](index=14&type=section&id=%E6%B5%81%E5%8A%A8%E8%B5%84%E9%87%91%E9%A3%8E%E9%99%A9) The Group manages its funding shortage risk through monthly cash flow forecasts, aiming to maintain a balance between funding sustainability and flexibility - The Group uses monthly cash flow forecasts to monitor its funding shortage risk[49](index=49&type=chunk) - The objective is to maintain a balance between funding sustainability and flexibility through cash from fixed deposits and funds generated from operations[49](index=49&type=chunk) [Employees and Remuneration Policy](index=15&type=section&id=%E9%9B%87%E5%91%98%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of December 31, 2019, the Group's employee count increased to 70, total staff costs rose to HKD 11.7 million, and remuneration is determined based on qualifications, position, and performance, with training provided - As of December 31, 2019, the Group had **70** employees working in Hong Kong, an increase from **56** in the corresponding period last year[52](index=52&type=chunk) - Total staff costs (including directors' emoluments and mandatory provident fund contributions) were approximately **HKD 11.7 million**, higher than **HKD 10.8 million** in the corresponding period last year[52](index=52&type=chunk) - Employee remuneration is determined based on qualifications, position, and performance, including salaries, allowances, and discretionary bonuses, with various training provided[52](index=52&type=chunk) [Dividends](index=15&type=section&id=%E8%82%A1%E6%81%AF) The Board has resolved not to declare any dividends for the nine months ended December 31, 2019, consistent with the prior year - For the nine months ended December 31, 2019, the Board did not declare any dividends[53](index=53&type=chunk) [Contingent Liabilities](index=15&type=section&id=%E6%88%96%E6%9C%89%E8%B4%9F%E5%80%BA) As of December 31, 2019, the Group had no significant contingent liabilities - As of December 31, 2019, the Group had no significant contingent liabilities[54](index=54&type=chunk) [Pledge of the Group's Assets](index=15&type=section&id=%E6%9C%AC%E9%9B%86%E5%9B%A2%E8%B5%84%E4%BA%A7%E4%B9%8B%E6%8A%B5%E6%8A%BC) As of December 31, 2019, the Group had no pledge of any assets - As of December 31, 2019, the Group had no pledge of any assets[55](index=55&type=chunk) [Events After Reporting Period](index=16&type=section&id=%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%90%8E%E4%BA%8B%E9%A1%B9) Subsequent to the reporting period, the Company's subsidiaries entered into a sale and purchase agreement with related party Chan Sing Hoi Enterprises Limited to acquire two properties for a total of HKD 95.5 million, partly paid by promissory notes. This acquisition constitutes a very substantial acquisition and connected transaction, subject to GEM Listing Rules' reporting, announcement, and shareholder approval requirements - On **February 4, 2020**, the Company's subsidiaries, Star Ocean Property Limited and Wing Luen Limited, entered into a sale and purchase agreement with related party Chan Sing Hoi Enterprises Limited[57](index=57&type=chunk) - Two properties were acquired for **HKD 50.0 million** for Property 1 and **HKD 45.5 million** for Property 2, totaling **HKD 95.5 million**[57](index=57&type=chunk) - Part of the consideration will be paid by promissory notes issued by the Company with principal amounts of **HKD 25.0 million** and **HKD 25.5 million**[57](index=57&type=chunk) - This acquisition constitutes a very substantial acquisition and connected transaction under the GEM Listing Rules, subject to reporting, announcement, and shareholder approval requirements[58](index=58&type=chunk) [Other Information](index=17&type=section&id=%E5%85%B6%E4%BB%96%E8%B5%84%E6%96%99) [Corporate Governance Practices and Compliance Matters](index=17&type=section&id=%E4%BC%81%E4%B8%9A%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A7%84%E5%8F%8A%E5%90%88%E8%A7%84%E4%BA%8B%E5%AE%9C) The Group is committed to maintaining high standards of corporate governance and has complied with all relevant provisions of the Corporate Governance Code set out in Appendix 15 of the GEM Listing Rules for the nine months ended December 31, 2019 - The Group is committed to maintaining high standards of corporate governance and complying with the Corporate Governance Code[62](index=62&type=chunk) - For the nine months ended December 31, 2019, the Company has complied with all relevant provisions of the Corporate Governance Code[62](index=62&type=chunk) [Directors' Securities Transactions](index=17&type=section&id=%E8%91%A3%E4%BA%8B%E7%9A%84%E8%AF%81%E5%88%B8%E4%BA%A4%E6%98%93) The Group has adopted a code of conduct for directors' securities transactions, and all directors confirmed compliance with the code during the reporting period - The Group has adopted a code of conduct for directors' securities transactions, with terms no less exacting than the required standards set out in the GEM Listing Rules[63](index=63&type=chunk) - Following specific enquiries, all directors confirmed compliance with the code of conduct for the nine months ended December 31, 2019[63](index=63&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=17&type=section&id=%E4%B9%B0%E5%8D%96%E6%88%96%E8%B5%8E%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%9A%84%E4%B8%8A%E5%B8%82%E8%AF%81%E5%88%B8) For the nine months ended December 31, 2019, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the nine months ended December 31, 2019, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[64](index=64&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares or Debentures of the Company and its Associated Corporations](index=18&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E6%9C%80%E9%AB%98%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%91%98%E4%BA%8E%E6%9C%AC%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%85%B6%E7%9B%B8%E8%81%94%E6%B3%95%E5%9B%A2%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E5%85%B3%E8%82%A1%E4%BB%BD%E6%88%96%E5%80%BA%E6%9D%83%E8%AF%81%E7%9A%84%E6%9D%83%E7%9B%8A%E5%8F%8A%E6%B7%A1%E4%BB%93) As of December 31, 2019, several directors and the chief executive held long positions in the Company's ordinary shares and underlying shares, primarily through controlled corporation Profit Ocean Enterprises Limited holding 75% equity, and a small number of beneficially owned shares through the share option scheme Directors' and Chief Executive's Long Positions in Ordinary Shares and Underlying Shares of the Company (As of December 31, 2019) | Name of Director/Chief Executive | Capacity/Nature of Interest | Number of Shares/Underlying Shares Held/Interested | Approximate Percentage of Shareholding | | :------------------------------- | :-------------------------- | :------------------------------------------------ | :----------------------------------- | | Chan Kwong Yuen | Interest in controlled corporation | 270,000,000 | 75% | | | Beneficial owner | 3,200,000 | 0.89% | | Chan Kun Yuen | Interest in controlled corporation | 270,000,000 | 75% | | | Beneficial owner | 3,200,000 | 0.89% | | Chan Shu Yuen | Interest in controlled corporation | 270,000,000 | 75% | | | Beneficial owner | 3,200,000 | 0.89% | | Siu Tsz Ming | Beneficial owner | 200,000 | 0.06% | | Lee Wai Ho | Beneficial owner | 200,000 | 0.06% | | Wong Tsz Chung | Beneficial owner | 200,000 | 0.06% | - The **270,000,000** shares are held by Profit Ocean Enterprises Limited, which is equally owned by Mr. Chan Tat Yuen, Mr. Chan Kun Yuen, Mr. Chan Shu Yuen, and Mr. Chan Kwong Yuen[68](index=68&type=chunk) - The beneficially owned shares are derived from share options granted under the share option scheme adopted on **March 14, 2018**[70](index=70&type=chunk) [Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares and Underlying Shares of the Company](index=20&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E4%B8%9C%E5%8F%8A%E5%85%B6%E4%BB%96%E4%BA%BA%E5%A3%AB%E4%BA%8E%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%82%A1%E4%BB%BD%E5%8F%8A%E7%9B%B8%E5%85%B3%E8%82%A1%E4%BB%BD%E7%9A%84%E6%9D%83%E7%9B%8A%E5%8F%8A%E6%B7%A1%E4%BB%93) As of December 31, 2019, Profit Ocean Enterprises Limited was a substantial shareholder of the Company, holding 75% equity. Mr. Chan Tat Yuen and his spouse Ms. Chu Man, along with other directors and their spouses, held significant shares through controlled corporations or spouse interests Substantial Shareholders' and Other Persons' Long Positions in Ordinary Shares and Underlying Shares of the Company (As of December 31, 2019) | Name of Shareholder/Person | Nature and Capacity of Interest | Number of Shares/Underlying Shares Held/Interested | Approximate Percentage of Total Issued Shares | | :------------------------- | :------------------------------ | :------------------------------------------------ | :-------------------------------------------- | | Profit Ocean | Beneficial owner | 270,000,000 | 75% | | Tri-Luck | Interest in controlled corporation | 270,000,000 | 75% | | Wealth City | Interest in controlled corporation | 270,000,000 | 75% | | Tin King | Interest in controlled corporation | 270,000,000 | 75% | | Coastal Lion | Interest in controlled corporation | 270,000,000 | 75% | | Mr. Chan Tat Yuen | Interest in controlled corporation | 270,000,000 | 75% | | | Beneficial owner | 3,200,000 | 0.89% | | Ms. Chu Man | Spouse interest | 270,000,000 | 75% | | | | 3,200,000 | 0.89% | - The issued share capital of Profit Ocean is equally held by Tri-Luck, Wealth City, Tin King, and Coastal Lion, which are wholly-owned by Mr. Chan Tat Yuen, Mr. Chan Kun Yuen, Mr. Chan Shu Yuen, and Mr. Chan Kwong Yuen, respectively[78](index=78&type=chunk) - An acting in concert arrangement exists among Mr. Chan Tat Yuen, Mr. Chan Kun Yuen, Mr. Chan Shu Yuen, and Mr. Chan Kwong Yuen, each deemed to be interested in all shares held by Profit Ocean[78](index=78&type=chunk) - Spouses of several directors (e.g., Ms. Chu Man, Ms. Chan King Chi, Ms. Po Miu Kuen, Ms. Ng Wai Lam) are deemed to be interested in the relevant shares by virtue of spouse interests[79](index=79&type=chunk) [Share Option Scheme](index=22&type=section&id=%E8%B4%AD%E8%82%A1%E6%9D%83%E8%AE%A1%E5%88%92) The Company adopted a share option scheme on March 14, 2018, and for the nine months ended December 31, 2019, a total of 32,300,000 share options were granted, of which 31,550,000 remained unexercised, with an exercise price of HKD 0.189 - The Company adopted a share option scheme on **March 14, 2018**, aiming to grant share options to participants including employees, consultants, advisors, and directors[86](index=86&type=chunk) Details of Share Option Scheme Movements (For the nine months ended December 31, 2019) | Category of Participants | Date of Grant | Exercise Period | Exercise Price (HKD) | Granted During the Period | Unexercised (December 31, 2019) | | :----------------------- | :------------- | :------------------------- | :------------------- | :------------------------ | :------------------------------ | | Directors | September 9, 2019 | June 1, 2020 to May 31, 2023 | 0.189 | 10,200,000 | 10,200,000 | | Substantial Shareholders | September 9, 2019 | June 1, 2020 to May 31, 2023 | 0.189 | 3,200,000 | 3,200,000 | | Other Employees | September 9, 2019 | June 1, 2020 to May 31, 2023 | 0.189 | 18,900,000 | 18,150,000 | | **Total** | | | | **32,300,000** | **31,550,000** | - **750,000** share options for other employees lapsed during the period[87](index=87&type=chunk) [Competing Interests](index=23&type=section&id=%E7%AB%9E%E4%BA%89%E6%9D%83%E7%9B%8A) The Directors are unaware of any business or interest held by Directors or controlling shareholders and their close associates that constitutes or may constitute a competing business or interest with the Group's business during the reporting period - The Directors are unaware of any business or interest held by Directors or the Company's controlling shareholders or any of their respective close associates that constitutes or may constitute a competing business or interest with the Group's business for the nine months ended December 31, 2019[91](index=91&type=chunk) [Audit Committee](index=23&type=section&id=%E5%AE%A1%E6%A0%B8%E5%A7%94%E5%91%98%E4%BC%9A) The Company's Audit Committee comprises three independent non-executive directors, responsible for reviewing and overseeing financial reporting, risk management, and internal control systems, and has reviewed the current period's results, deeming them compliant with applicable accounting standards and GEM Listing Rules - The Audit Committee was established on **March 14, 2018**, comprising all three independent non-executive directors, with Mr. Siu Tsz Ming as Chairman[92](index=92&type=chunk) - Its primary responsibilities include reviewing and overseeing the Group's financial reporting process, risk management, and internal control systems, and reviewing financial information[92](index=92&type=chunk) - The Audit Committee has reviewed the Company's unaudited condensed consolidated results for the nine months ended December 31, 2019, and considers them to be in compliance with applicable accounting standards and the requirements of the GEM Listing Rules[92](index=92&type=chunk) [Compliance Adviser's Interests](index=23&type=section&id=%E5%90%88%E8%A7%84%E9%A1%BE%E9%97%AE%E6%9D%83%E7%9B%8A) The Company has appointed Kingston Corporate Finance Limited as its compliance adviser, and as of the reporting date, neither the compliance adviser nor its associates held any interests in the share capital of the Company or any member of the Group that are required to be disclosed to the Company - The Company has appointed Kingston Corporate Finance Limited as its compliance adviser[93](index=93&type=chunk) - As of December 31, 2019, and up to the date of this report, neither the compliance adviser nor its directors, employees, or close associates held any interests in the share capital of the Company or any member of the Group that are required to be disclosed to the Company[93](index=93&type=chunk) [By Order of the Board](index=23&type=section&id=%E6%89%BF%E8%91%A3%E4%BA%8B%E4%BC%9A%E5%91%BD) This report was signed and released by Mr. Chan Kwong Yuen, Chairman of the Board, on February 12, 2020. The Board comprises three executive directors and three independent non-executive directors - This report was signed by Mr. Chan Kwong Yuen, Chairman of Wing Kee Tea House Group Limited, on **February 12, 2020**[94](index=94&type=chunk)[95](index=95&type=chunk) - The Board comprises executive directors Mr. Chan Kwong Yuen, Mr. Chan Kun Yuen, and Mr. Chan Shu Yuen, and independent non-executive directors Mr. Wong Tsz Chung, Mr. Siu Tsz Ming, and Mr. Lee Wai Ho[94](index=94&type=chunk)[95](index=95&type=chunk)

Financial Performance - Revenue for the six months ended September 30, 2019, was HKD 15,997,000, a decrease of 6% compared to HKD 17,000,000 for the same period in 2018[7] - Gross profit for the six months ended September 30, 2019, was HKD 12,183,000, representing a gross margin of approximately 76.3%[7] - The company reported a loss before tax of HKD 6,251,000 for the six months ended September 30, 2019, compared to a loss of HKD 1,637,000 for the same period in 2018[7] - Basic and diluted loss per share for the six months ended September 30, 2019, was HKD 1.72, compared to HKD 0.26 for the same period in 2018[7] - The company reported a net loss before tax of HKD 3,204,000 for the three months ended September 30, 2019, compared to a loss of HKD 925,000 for the same period in 2018[43] - For the six months ended September 30, 2019, the company reported a loss attributable to equity holders of HKD 6,251,000, compared to a loss of HKD 5,219,000 for the same period in 2018, representing an increase in loss of approximately 19.8%[43] - The group reported a significant loss of approximately HKD 6.251 million for the period, compared to a loss of HKD 5.219 million in the previous year[73] Assets and Liabilities - Total assets as of September 30, 2019, were HKD 32,982,000, a decrease from HKD 39,207,000 as of March 31, 2019[8] - The company's cash and bank balances decreased to HKD 2,788,000 as of September 30, 2019, from HKD 10,172,000 as of March 31, 2019[8] - Trade receivables as of September 30, 2019, amounted to HKD 704,000, down 50.7% from HKD 1,429,000 as of March 31, 2019[49] - The total lease liabilities as of September 30, 2019, were HKD 2,096,000, with HKD 1,043,000 due within one year[53] - The group had a total minimum lease payment obligation of HKD 6.694 million due within one year as of September 30, 2019, compared to HKD 3.939 million as of March 31, 2019[61] - The debt-to-equity ratio as of September 30, 2019, was approximately 15.5%, an increase from 7.8% as of March 31, 2019, due to increased accrued expenses and decreased retained earnings[83] Revenue Sources - Tea product sales for the six months ended September 30, 2019, amounted to HKD 15,508,000, a decrease of 9% compared to HKD 17,022,000 for the same period in 2018[25] - Retail sales of food and beverages reached HKD 489,000 for the six months ended September 30, 2019, with no sales reported in the same period of 2018[25] - Total revenue for the six months ended September 30, 2019, was HKD 15,997,000, down from HKD 17,022,000 in the previous year, representing a decline of approximately 6%[25] Expenses - The company incurred administrative expenses of HKD 18,169,000 for the six months ended September 30, 2019, up from HKD 6,962,000 for the same period in 2018[7] - Administrative expenses for the six months ended September 30, 2019, increased significantly compared to the same period in 2018, primarily due to new staff hiring and increased rental costs[78] - Total employee costs for the six months ended September 30, 2019, were approximately HKD 7.1 million, up from HKD 6.7 million for the same period in 2018[89] Market Conditions - The company experienced a decline in retail sales due to ongoing social unrest, with sales in July, August, and September dropping by 11.4%, 23.0%, and 18.3% year-on-year, respectively[74] - The group anticipates negative growth for the remainder of 2019 due to widespread protests affecting the Hong Kong economy[81] - The company's management discussed the impact of the ongoing social events on revenue contraction and increased administrative expenses, contributing to the reported losses[76] Future Outlook - The company has not provided specific guidance for future performance but indicated a focus on improving operational efficiency and exploring new market opportunities[12] - The company has sufficient cash to meet current business needs and obligations, but will adopt prudent cash management strategies if revenue continues to decline[81] Shareholder Information - The company has a significant shareholder structure, with Profit Ocean Enterprises Limited holding 270,000,000 shares, representing 75% of the total issued shares[114] - The major shareholders, including Tri-Luck, Wealth City, Tianjing, and Coastal Lion, each hold 25% of Profit Ocean's issued share capital[112] - The beneficial ownership of the shares is concentrated among four individuals: Chen Da Yuan, Chen Gen Yuan, Chen Shu Yuan, and Chen Guang Yuan, each holding 270,000,000 shares[114] - The company has not pledged any shares to any contracting parties, and there are no covenants restricting specific performance conditions that could lead to a breach of loan agreements[120] Compliance and Governance - The audit committee was established on March 14, 2018, and consists of three independent non-executive directors, with responsibilities including reviewing financial reporting and risk management[128] - The company has a clear governance structure in place, ensuring compliance with GEM listing rules and internal controls[128] - The company maintains compliance with the Securities and Futures Ordinance regarding the disclosure of interests and positions in shares[120]