Financial Results - The unaudited condensed consolidated results for the nine months ended December 31, 2021, have been announced, with comparative figures for the same period in 2020[18]. - The report includes a statement of profit or loss and other comprehensive income for the nine months ended December 31, 2021[19]. - The financial results have not been audited but have been reviewed and approved by the audit committee of the Company[18]. - Revenue for the nine months ended December 31, 2021, was HK$175,901,000, representing an increase of 10.8% compared to HK$159,774,000 in the same period of 2020[20]. - Gross profit decreased to HK$24,507,000, down 19.8% from HK$30,568,000 year-on-year[20]. - Profit from operations significantly dropped to HK$1,480,000, down 91.6% from HK$17,496,000[20]. - Loss for the period was HK$643,000 compared to a profit of HK$13,661,000 in the previous year[20]. - Other net income for the period totaled HK$3,921,000, down from HK$5,756,000 in the previous year[45]. - Cost of sales increased by approximately 17.2% to approximately HK$151,394,000 from approximately HK$129,206,000[76]. - Gross profit decreased by approximately 19.8% to approximately HK$24,507,000, with a gross profit margin decrease to 13.9% from approximately 19.1%[77]. Revenue Breakdown - Sales of ODM toys to license holders decreased by 12.5% to HK$91,441,000 from HK$104,467,000[36]. - Distribution of imported toys and related products increased by 22.6% to HK$41,355,000 from HK$33,715,000[36]. - Sales of own licensed toys and related products surged by 99.5% to HK$43,105,000 from HK$21,592,000[36]. - Revenue from the sales of ODM toys to license holders decreased by approximately 12.5% to approximately HK$91,441,000, primarily due to a decline in production capacity of suppliers in mainland China[66]. - Revenue from the distribution of imported toys and related products increased by approximately 22.7% to approximately HK$41,355,000, driven by the release of a hot-selling high-end robot figure[67]. - Revenue from the sales of own licensed toys and related products increased by approximately 99.6% to approximately HK$43,105,000, attributed to the popularity of a newly developed superhero series figure[68]. Expenses and Costs - Administrative expenses increased to HK$16,626,000, up 32.3% from HK$12,579,000[20]. - Selling expenses rose to HK$9,446,000, an increase of 51.5% from HK$6,249,000[20]. - Staff costs increased to HK$13,016,000 from HK$9,336,000, reflecting higher salaries and benefits[47]. Corporate Governance and Compliance - The Company has a responsibility to ensure the accuracy and completeness of the information provided in the report[5]. - The Audit Committee reviewed the unaudited condensed consolidated financial statements for the nine months ended 31 December 2021, confirming compliance with applicable accounting standards and GEM Listing Rules[156]. - The Company has complied with the Corporate Governance Code during the period, except for a deviation regarding the roles of the chairman and CEO being held by Mr. Li[155]. - The Board will continue to review the appropriateness of splitting the roles of chairman and CEO in the future[155]. - The Company has made adequate disclosures in its financial statements as per legal requirements[156]. Shareholder Information - As of December 31, 2021, Mr. Li Wai Keung holds 180,800,000 shares, representing 18.08% of the Company's issued share capital[135]. - The Company has not redeemed any ordinary shares during the reporting period, nor has it purchased or sold any of its ordinary shares[142]. - The Group did not recommend the payment of dividends for the Period, consistent with the Corresponding Period[119]. - The issued ordinary share capital of the Company was HK$10,000,000, divided into 1,000,000,000 shares of HK$0.01 each[148]. Future Outlook and Strategy - The Group is negotiating a possible acquisition of DongYiQuan Network Technology Co., Ltd., with a memorandum of understanding signed[104]. - The Board aims to expand the Group's network beyond the ACG figure toys market to enhance income sources and shareholder value[128]. - The Group plans to leverage its advantages in high-end toy products to achieve breakthroughs in business performance[131]. Risks and Challenges - The Group's exposure to foreign currency risk primarily arises from financial instruments denominated in JPY, RMB, and USD, with no hedging strategies adopted[111]. - The Group's revenue for the third quarter of 2021/22 was impacted by ineffective quality control over suppliers and products, which may adversely affect business operations[132]. - The Group may face delays and/or defaults in payments by customers, which could adversely affect cash flows and financial results[132]. - The failure to renew existing license rights or obtain new ones for licensed toys could negatively impact the Group's financial performance[132].

[Corporate Information](index=4&type=section&id=Corporate%20Information) The company's governance structure includes its Board of Directors, key committees, and external auditor - The Board of Directors is led by Executive Directors Mr. Li Wai Keung (Chairman and CEO), Mr. To Hoi Pan, and Ms. Li Kwai Fong, with established Audit, Remuneration, and Nomination Committees[11](index=11&type=chunk)[12](index=12&type=chunk)[13](index=13&type=chunk) - The company's auditor is Grant Thornton Hong Kong Limited[14](index=14&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) [Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) Revenue grew 22.1% YoY, but profit for the period fell sharply by 54.4% due to lower gross margin and higher expenses Consolidated Statement of Profit or Loss Summary (For the six months ended September 30) | Metric | 2021 (HK$ '000) | 2020 (HK$ '000) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 116,391 | 95,294 | +22.1% | | Gross Profit | 18,630 | 17,211 | +8.2% | | Operating Profit | 4,493 | 8,547 | -47.4% | | Profit for the period | 2,878 | 6,313 | -54.4% | | Basic earnings per share (HK cents) | 0.29 | 0.63 | -54.0% | [Unaudited Condensed Consolidated Statement of Financial Position](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) The company's financial position remained solid with a slight growth in net assets and a significant increase in cash reserves Consolidated Statement of Financial Position Summary | Metric | Sep 30, 2021 (HK$ '000) | Mar 31, 2021 (HK$ '000) | Period Change | | :--- | :--- | :--- | :--- | | Non-current assets | 56,258 | 56,196 | +0.1% | | Current assets | 171,549 | 165,174 | +3.9% | | Current liabilities | 45,152 | 41,363 | +9.2% | | Net current assets | 126,397 | 123,811 | +2.1% | | Net assets | 181,749 | 178,871 | +1.6% | | Bank balances and cash | 107,900 | 86,961 | +24.1% | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) Total equity increased during the period, driven entirely by the profit recorded, with no other equity movements Summary of Changes in Equity (For the six months ended September 30) | Item | Amount (HK$ '000) | | :--- | :--- | | Balance at April 1, 2021 | 178,871 | | Profit for the period | 2,878 | | Balance at September 30, 2021 | 181,749 | [Unaudited Condensed Consolidated Statement of Cash Flow Statement](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Cash%20Flow%20Statement) The company demonstrated strong cash generation with a significant increase in net cash from operating activities Consolidated Cash Flow Statement Summary (For the six months ended September 30) | Item | 2021 (HK$ '000) | 2020 (HK$ '000) | YoY Change | | :--- | :--- | :--- | :--- | | Net cash from operating activities | 22,450 | 10,279 | +118.4% | | Net cash from/(used in) investing activities | 535 | (2,191) | N/A | | Net cash used in financing activities | (2,046) | (1,985) | +3.1% | | Net increase in cash and cash equivalents | 20,939 | 6,103 | +243.1% | | Cash and cash equivalents at end of period | 107,900 | 121,205 | -11.0% | [Notes to the Unaudited Condensed Consolidated Interim Financial Statements](index=10&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Interim%20Financial%20Statements) [Revenue and Business Segment](index=15&type=section&id=4.%20Revenue%20and%20business%20segment) Total revenue grew 22.1%, driven by strong performance in imported and self-licensed toys, though the core ODM segment declined Revenue by Business Segment (For the six months ended September 30) | Business Segment | 2021 (HK$ '000) | 2020 (HK$ '000) | YoY Change | | :--- | :--- | :--- | :--- | | Sales of ODM toys to license holders | 56,767 | 62,709 | -9.5% | | Distribution of imported toys and related products | 30,285 | 20,825 | +45.4% | | Sales of self-licensed toys and related products | 29,339 | 11,760 | +149.5% | | **Total** | **116,391** | **95,294** | **+22.1%** | - Revenue from the Group's five largest customers accounted for approximately **72% of total revenue**, indicating continued high customer concentration[57](index=57&type=chunk)[58](index=58&type=chunk) - The Group's largest single customer contributed revenue of **HK$58.604 million**, representing approximately **50.3% of total revenue**[64](index=64&type=chunk) [Other Key Financial Notes](index=18&type=section&id=Other%20Key%20Financial%20Notes) Net other income fell due to the absence of prior-year government subsidies, while staff costs rose significantly - Net other income decreased significantly as the **government subsidies of HK$1.908 million** received in the prior period were discontinued[67](index=67&type=chunk) - Staff costs increased by **43.7%** from HK$6.638 million to HK$9.542 million[68](index=68&type=chunk) - No dividend was paid or declared by the company or any of its subsidiaries for the six months ended September 30, 2021[106](index=106&type=chunk) [Management Discussion and Analysis](index=26&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review](index=26&type=section&id=Business%20review) ODM toy revenue fell due to supplier constraints, while imported and self-licensed toy segments achieved substantial growth - Revenue from sales of ODM toys decreased by **9.5%** due to severe capacity reductions at suppliers in mainland China caused by power and water supply failures[117](index=117&type=chunk) - Revenue from distribution of imported toys grew by **45.4%**, primarily driven by a popular high-end robot figure that contributed over 50% of the segment's sales[118](index=118&type=chunk) - Revenue from sales of self-licensed toys surged by **149.5%**, attributed to a low base in the prior period and the popularity of a newly developed superhero figure series[119](index=119&type=chunk)[120](index=120&type=chunk) [Financial Analysis](index=27&type=section&id=Financial%20Analysis) Gross margin declined due to higher production costs, while administrative expenses rose from a discretionary bonus to the Chairman - Gross profit margin decreased from **18.1%** to **16.0%** due to additional production and labor costs passed on by suppliers amid an unstable production environment in mainland China[128](index=128&type=chunk) - Selling expenses increased by **14.2%**, mainly due to expenses related to the Ani-Com & Games Hong Kong event, which was canceled in the prior period[130](index=130&type=chunk) - Administrative expenses rose by **29.3%**, primarily due to a **HK$3 million discretionary bonus** paid to Chairman Mr. Li Wai Keung for his outstanding leadership since the company's listing in 2018[139](index=139&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=29&type=section&id=Liquidity,%20financial%20resources%20and%20funding) The Group maintained a strong financial position with ample cash reserves and a very low gearing ratio Key Liquidity and Capital Structure Metrics | Metric | Sep 30, 2021 | Mar 31, 2021 | | :--- | :--- | :--- | | Cash and bank balances (HK$ '000) | 107,900 | 86,961 | | Bank borrowings (HK$ '000) | 3,407 | 3,487 | | Lease liabilities (HK$ '000) | 2,543 | 3,559 | | Gearing ratio | 0.02 times | 0.02 times | [Outlook and Principal Risks](index=31&type=section&id=Outlook%20and%20Principal%20risks%20and%20uncertainties) The Group plans to expand its revenue streams while actively managing key operational and strategic risks - The Board will actively seek potential business opportunities to expand beyond the ACG figure toy market, aiming to broaden revenue sources and enhance shareholder value[174](index=174&type=chunk)[176](index=176&type=chunk) Principal Risks and Mitigation Measures | Principal Risk | Mitigation Measures | | :--- | :--- | | Failure to secure new orders | Maintain strong relationships with major customers and actively explore new ones | | Reliance on senior management team | Provide continuous training to enhance the performance of the senior management team | | Ineffective supplier and product quality control | A professional engineering team works closely with suppliers to maintain high-quality standards | | Customer payment delays or defaults | Offer credit terms only to reputable long-term customers; most transactions are on a cash basis | | Failure to renew or obtain new licenses | A dedicated team works closely with existing licensors and develops potential new ones | [Other Information](index=33&type=section&id=Other%20Information) [Interests of Directors and Major Shareholders](index=33&type=section&id=Interests%20and%20Short%20Positions%20of%20Directors%20and%20Chief%20Executive) Chairman and CEO Mr. Li Wai Keung and Mr. Wong Man Hin are the company's two substantial shareholders Major Shareholder Holdings (as at September 30, 2021) | Shareholder Name | Nature of Interest | Number of Shares | Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Li Wai Keung | Interest in a controlled corporation | 380,800,000 (L) | 38.08% | | Infinite Force | Beneficial owner | 380,800,000 (L) | 38.08% | | Mr. Wong Man Hin | Beneficial owner | 102,920,000 (L) | 10.29% | [Corporate Governance](index=36&type=section&id=Corporate%20governance%20practice) The company deviated from the Corporate Governance Code by not separating the roles of Chairman and CEO - The company complied with the Corporate Governance Code but deviated from code provision A.2.1, as the roles of Chairman and CEO are both held by Mr. Li Wai Keung[199](index=199&type=chunk) - The Board believes that combining the roles of Chairman and CEO provides strong leadership and is beneficial for the Group's management and business development, and will continue to review this arrangement[199](index=199&type=chunk) - The Audit Committee has reviewed the unaudited condensed consolidated interim financial statements and concluded that they comply with relevant standards and requirements with adequate disclosure[203](index=203&type=chunk)

（於開曼群島註冊成立之有限公司） (incorporated in the Cayman Islands with limited liability) (Stock code 股份代號 : 8545) FIRST QUARTERLY REPORT 第一季度業績報告 2021/22 CHARACTERISTICS OF GEM OF THE STOCK EXCHANGE OF HONG KONG LIMITED (THE "STOCK EXCHANGE") GEM has been positioned as a market designed to accommodate small and mid-sized companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companie ...

[Corporate Information](index=3&type=section&id=Corporate%20Information) This section provides an overview of the company's board of directors, committees, and essential corporate details [Board of Directors](index=4&type=section&id=Board%20of%20Directors) This section lists the Board of Directors of Billion Group Holdings Limited, including executive, non-executive, and independent non-executive directors, as well as the company secretary and compliance officer - **Executive Directors**: Mr. Li Wai Keung (Chairman and Chief Executive Officer), Mr. To Hoi Bun, Ms. Li Kwai Fong[10](index=10&type=chunk)[12](index=12&type=chunk) - **Non-executive Director**: Mr. Yu Tsz Yat (appointed on February 1, 2021, and resigned on June 9, 2021)[10](index=10&type=chunk)[12](index=12&type=chunk) - **Independent Non-executive Directors**: Mr. Yu Pui Hang, Ms. Chow Chi Ling, Ms. Yam Hung Yin (appointed on February 1, 2021)[10](index=10&type=chunk)[12](index=12&type=chunk) - **Company Secretary and Compliance Officer**: Mr. To Hoi Bun[10](index=10&type=chunk)[12](index=12&type=chunk) [Committees](index=4&type=section&id=Committees) This section details the composition of the company's Audit Committee, Remuneration Committee, and Nomination Committee - **Audit Committee Chairman**: Ms. Chow Chi Ling[11](index=11&type=chunk)[12](index=12&type=chunk) - **Remuneration Committee Chairman**: Mr. Yu Pui Hang[11](index=11&type=chunk)[12](index=12&type=chunk) - **Nomination Committee Chairman**: Ms. Yam Hung Yin (appointed on February 1, 2021)[11](index=11&type=chunk)[12](index=12&type=chunk) [Company Details](index=4&type=section&id=Company%20Details) This section provides basic information about the company's auditor, registered office, principal place of business in Hong Kong, share registrar, compliance adviser, legal adviser, principal bankers, company website, and stock code - **Auditor**: Grant Thornton Hong Kong Limited[12](index=12&type=chunk) - **Registered Office**: Cayman Islands[13](index=13&type=chunk)[14](index=14&type=chunk) - **Principal Place of Business in Hong Kong**: Unit A-C, 3A/F, Merit Industrial Building, 24-32 Kwai Chung Street, Tsuen Wan, Hong Kong[13](index=13&type=chunk)[14](index=14&type=chunk) - **Stock Code**: **8545**[14](index=14&type=chunk)[15](index=15&type=chunk) [Chairman's Statement](index=6&type=section&id=Chairman's%20Statement) This report outlines the company's operational environment, challenges, and strategic direction amidst the impact of the COVID-19 pandemic [Business Environment and Challenges](index=6&type=section&id=Business%20Environment%20and%20Challenges) The Chairman's report highlights a challenging business environment due to the COVID-19 pandemic, severely impacting physical cash flow, with the company strengthening online sales but facing challenges from RMB appreciation, rising raw material and labor costs, and water/power supply restrictions in Guangdong - The COVID-19 pandemic severely damaged the physical retail industry, prompting the company to strengthen online sales to reduce reliance[17](index=17&type=chunk)[21](index=21&type=chunk) - **Cost pressures**: RMB appreciation, sharp increases in raw material prices, labor shortages, and rising salaries significantly impacted costs[18](index=18&type=chunk)[21](index=21&type=chunk) - **Supply chain restrictions**: Abnormal weather conditions severely affected water and power supply in Guangdong Province, impacting production and shipment speeds[19](index=19&type=chunk)[22](index=22&type=chunk) [Future Strategy](index=6&type=section&id=Future%20Strategy) Facing a severe operating environment, the company plans to adopt a conservative development approach over the next 1-2 years, focusing on product quality and reducing high-risk investments to maintain stable performance and growth momentum among peers - A **conservative development approach** will be adopted for the next 1-2 years, continuing to maintain market competitiveness through product quality[20](index=20&type=chunk)[22](index=22&type=chunk) - **High-risk investments will be reduced** to maintain relatively stable performance and development compared to peers[20](index=20&type=chunk)[22](index=22&type=chunk) [Management Discussion and Analysis](index=7&type=section&id=Management%20Discussion%20and%20Analysis) This section reviews the group's business performance, financial results, operational health, use of proceeds, and contingent liabilities for the fiscal year [Business Review](index=7&type=section&id=Business%20Review) The Group primarily engages in the design, marketing, distribution, and retail of toys and related products, with ODM toy sales slightly decreasing but remaining the main revenue source in FY2021, while distribution of imported toys saw significant growth and sales of proprietary licensed toys slightly decreased - The Group's principal business involves the design, marketing, distribution, and retail of toys and related products[24](index=24&type=chunk)[27](index=27&type=chunk) FY2021 Revenue and Profit Margin Changes by Business Segment | Business Segment | 2021 Revenue (HKD) | 2020 Revenue (HKD) | Revenue Change (%) | 2021 Profit Margin (%) | 2020 Profit Margin (%) | Profit Margin Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Sales of ODM Toys | 134,054,000 | 136,829,000 | -2.0% | 14.9% | 18.1% | -17.7% | | Distribution of Imported Toys and Related Products | 44,297,000 | 36,669,000 | +20.8% | - | - | - | | Sales of Proprietary Licensed Toys and Related Products | 33,116,000 | 33,467,000 | -1.0% | - | - | - | - The decrease in **ODM toy profit margin** was primarily due to suppliers passing on increased labor and raw material costs to the Group[26](index=26&type=chunk)[29](index=29&type=chunk) - In the imported toy distribution business, **high-end robot collectible figures** were a high-growth category[31](index=31&type=chunk)[34](index=34&type=chunk) [Financial Analysis](index=8&type=section&id=Financial%20Analysis) The Group's revenue for FY2021 increased slightly by **2.2%**, primarily driven by the imported toy distribution business, but rising cost of sales led to a **10.0%** decrease in gross profit, with gross margin falling from **20.4%** to **18.0%**; administrative expenses increased due to forfeiture of trade deposits from cancelled orders, while finance costs decreased due to lower bank loan interest FY2021 Key Financial Indicators Changes | Indicator | 2021 (HKD) | 2020 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 211,467,000 | 206,965,000 | +2.2% | | Cost of Sales | 173,503,000 | 164,783,000 | +5.3% | | Gross Profit | 37,964,000 | 42,182,000 | -10.0% | | Gross Margin | 18.0% | 20.4% | -2.4 percentage points | | Net Other Income | 6,477,000 | 6,254,000 | +3.6% | | Selling Expenses | 5,649,000 | 6,882,000 | -17.9% | | Administrative Expenses | 25,975,000 | 24,515,000 | +6.0% | | Finance Costs | 196,000 | 348,000 | -43.7% | | Income Tax Expense | 3,694,000 | 3,874,000 | -4.6% | - The increase in cost of sales included an inventory write-down of approximately **HKD 1,078,000**[39](index=39&type=chunk)[43](index=43&type=chunk) - The decrease in selling expenses was primarily due to the cancellation of local and overseas exhibition activities caused by the COVID-19 pandemic[42](index=42&type=chunk)[46](index=46&type=chunk) - The increase in administrative expenses was mainly due to the forfeiture of trade deposits of approximately **HKD 2,318,000** resulting from cancelled orders with incurred mold costs[50](index=50&type=chunk)[54](index=54&type=chunk) - The decrease in finance costs was primarily due to reduced interest on bank loans[51](index=51&type=chunk)[55](index=55&type=chunk) [Operational & Financial Health](index=10&type=section&id=Operational%20%26%20Financial%20Health) The Group had no definite major investment and capital asset plans for FY2021 but invested in a joint venture for protective product manufacturing; the Group's financial position remains sound with a gearing ratio of **0.02 times**, a slight increase in staff headcount, and higher total staff costs, with the Board not recommending a dividend payout - There are no definite major investment and capital asset plans for the future, but the company has invested **HKD 3,000,000** in a joint venture (30% stake) to produce protective products[59](index=59&type=chunk)[60](index=60&type=chunk)[62](index=62&type=chunk) Gearing Ratio and Staff Costs | Indicator | As at March 31, 2021 | As at March 31, 2020 | | :--- | :--- | :--- | | Gearing Ratio | 0.02 times | 0.02 times | | Number of Employees | 39 persons | 38 persons | | Total Staff Costs | HKD 14,301,000 | HKD 12,646,000 | - The Group's financial position is **good and sound**, with sufficient bank balances and cash to meet funding requirements[61](index=61&type=chunk)[63](index=63&type=chunk) - The Group primarily faces foreign exchange risks from USD, JPY, and RMB, but currently has no foreign currency hedging policy, with management closely monitoring the situation[66](index=66&type=chunk)[70](index=70&type=chunk) - As of March 31, 2021, buildings with a total carrying amount of approximately **HKD 6,246,000** were mortgaged as collateral for bank financing[67](index=67&type=chunk)[71](index=71&type=chunk) - The Board does not recommend the payment of a dividend for the year ended March 31, 2021[69](index=69&type=chunk)[73](index=73&type=chunk) [Use of Proceeds](index=13&type=section&id=Use%20of%20Proceeds) The company fully utilized the net proceeds from its listing, approximately **HKD 57.9 million**, in FY2021, primarily for expanding its proprietary licensed toy product portfolio, enhancing its overseas distribution network, strengthening human resources, and improving IT systems and warehouse renovation - The net proceeds from the listing, approximately **HKD 57,900,000**, were fully utilized during the year[75](index=75&type=chunk) Use of Listing Proceeds | Purpose | Total Planned Amount (HK$'000) | Actual Amount Used as at March 31, 2021 (HK$'000) | | :--- | :--- | :--- | | Expanding proprietary licensed toy and related product portfolio | 46,200 | 46,200 | | Enhancing overseas distribution network | 3,600 | 3,600 | | Further strengthening human resources | 6,000 | 6,000 | | Further improving IT systems and warehouse renovation | 2,100 | 2,100 | | **Total** | **57,900** | **57,900** | [Contingent Liabilities](index=13&type=section&id=Contingent%20Liabilities) As of March 31, 2021, the Group had no significant contingent liabilities - As at March 31, 2021, the Group had **no significant contingent liabilities** (2020: nil)[77](index=77&type=chunk)[78](index=78&type=chunk) [Directors and Senior Management Profile](index=14&type=section&id=Directors%20and%20Senior%20Management%20Profile) This section provides biographical details, responsibilities, and professional experience of the company's executive, non-executive, and independent non-executive directors, as well as senior management [Executive Directors](index=14&type=section&id=Executive%20Directors) This section introduces the backgrounds, responsibilities, and industry experience of Mr. Li Wai Keung (Chairman and Chief Executive Officer), Mr. To Hoi Bun (Executive Director and Company Secretary), and Ms. Li Kwai Fong (Executive Director and General Manager) - **Mr. Li Wai Keung** (41 years old): Founder of the Group, Chairman and Chief Executive Officer, responsible for overall business development, financial and strategic planning, with over **15 years of experience** in the ACG toy industry[80](index=80&type=chunk)[83](index=83&type=chunk) - **Mr. To Hoi Bun** (47 years old): Executive Director and Company Secretary, responsible for financial reporting, planning, treasury, and financial management, with over **20 years of experience** in accounting and financial management[82](index=82&type=chunk)[84](index=84&type=chunk)[86](index=86&type=chunk) - **Ms. Li Kwai Fong** (35 years old): Executive Director and General Manager, primarily responsible for managing the Group's general operations[87](index=87&type=chunk) [Non-executive Director](index=15&type=section&id=Non-executive%20Director) This section introduces the background of Mr. Yu Tsz Yat, who was appointed as a Non-executive Director on February 1, 2021, and resigned on June 9, 2021 - **Mr. Yu Tsz Yat** (27 years old): Appointed as a Non-executive Director on **February 1, 2021**, and resigned on **June 9, 2021**[89](index=89&type=chunk)[93](index=93&type=chunk) [Independent Non-executive Directors](index=16&type=section&id=Independent%20Non-executive%20Directors) This section introduces the backgrounds, professional qualifications, and roles in company committees of Mr. Yu Pui Hang, Ms. Chow Chi Ling, and Ms. Yam Hung Yin - **Mr. Yu Pui Hang** (41 years old): Independent Non-executive Director, Chairman of the Remuneration Committee, and member of the Audit Committee and Corporate Governance Committee, with a legal background[95](index=95&type=chunk)[96](index=96&type=chunk)[99](index=99&type=chunk) - **Ms. Chow Chi Ling** (38 years old): Independent Non-executive Director, with over **15 years of experience** in auditing and financial management, and a practicing accountant of the Hong Kong Institute of Certified Public Accountants[101](index=101&type=chunk)[103](index=103&type=chunk) - **Ms. Yam Hung Yin** (53 years old): Appointed as an Independent Non-executive Director on **February 1, 2021**, with over **10 years of experience** in real estate investment development and finance[107](index=107&type=chunk)[108](index=108&type=chunk)[112](index=112&type=chunk) [Company Secretary](index=19&type=section&id=Company%20Secretary) This section introduces Mr. To Hoi Bun as the Company Secretary, who received professional training during the year - **Mr. To Hoi Bun**: Financial Controller and Company Secretary, received no less than **15 hours of professional training** during the year ended March 31, 2021[114](index=114&type=chunk)[117](index=117&type=chunk) [Senior Management](index=19&type=section&id=Senior%20Management) This section introduces the background and responsibilities of Ms. Fu Man Yin, who serves as Marketing Manager, overseeing the Group's sales and marketing activities - **Ms. Fu Man Yin** (35 years old): Marketing Manager, primarily responsible for overseeing the Group's sales and marketing activities[115](index=115&type=chunk)[118](index=118&type=chunk) [Corporate Governance Report](index=20&type=section&id=Corporate%20Governance%20Report) This report details the company's corporate governance framework, board and committee structures, risk management, internal controls, and shareholder relations [Corporate Governance Framework](index=20&type=section&id=Corporate%20Governance%20Framework) The company is committed to maintaining high standards of corporate governance and complies with the Corporate Governance Code set out in Appendix 15 of the GEM Listing Rules, though the roles of Chairman and Chief Executive Officer are held by the same person, deviating from code provision A.2.1, and the company has adopted a board diversity policy - The company has complied with all applicable Corporate Governance Code provisions, except for a deviation from code provision A.2.1 (where the roles of Chairman and Chief Executive Officer are held by the same person)[121](index=121&type=chunk)[122](index=122&type=chunk)[135](index=135&type=chunk)[138](index=138&type=chunk) - A **Board Diversity Policy** has been adopted, considering factors such as gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge, and length of service[124](index=124&type=chunk) [Board of Directors and Committees](index=21&type=section&id=Board%20of%20Directors%20and%20Committees) The Board of Directors comprises three executive directors and three independent non-executive directors, with independent non-executive directors accounting for **50%** of the Board members; the Board holds regular meetings and has established an Audit Committee, Remuneration Committee, and Nomination Committee to assist in fulfilling its responsibilities - The Board consists of **three executive directors** and **three independent non-executive directors**, with independent non-executive directors comprising **50%** of the total Board members[133](index=133&type=chunk)[137](index=137&type=chunk) - All directors participated in **continuing professional development training** to develop and update their knowledge and skills[136](index=136&type=chunk)[139](index=139&type=chunk)[141](index=141&type=chunk) - **Four Board meetings** were held during the year, and directors had access to independent professional advice[149](index=149&type=chunk)[152](index=152&type=chunk) [Audit Committee](index=26&type=section&id=Audit%20Committee) The Audit Committee, composed of three independent non-executive directors, is responsible for reviewing the company's financial information, overseeing the Group's financial reporting system, risk management, and internal control systems, and making recommendations on the appointment of external auditors, having held one meeting during the year - The Audit Committee comprises Ms. Chow Chi Ling (Chairman), Mr. Yu Pui Hang, and Ms. Yam Hung Yin (all independent non-executive directors)[158](index=158&type=chunk)[160](index=160&type=chunk) - Its primary responsibilities include reviewing financial information, overseeing financial reporting, risk management, and internal control systems, and making recommendations on the appointment of external auditors[157](index=157&type=chunk)[160](index=160&type=chunk) - **One meeting** was held during the year to review and approve the annual financial results for the year ended March 31, 2021[159](index=159&type=chunk)[160](index=160&type=chunk) [Remuneration Committee](index=27&type=section&id=Remuneration%20Committee) The Remuneration Committee, composed of three independent non-executive directors, is primarily responsible for advising the Board on the overall remuneration policy and structure for all directors and senior management of the Group, and for reviewing performance-based remuneration, having held one meeting during the year - The Remuneration Committee comprises Mr. Yu Pui Hang (Chairman), Ms. Chow Chi Ling, and Ms. Yam Hung Yin (all independent non-executive directors)[162](index=162&type=chunk)[165](index=165&type=chunk) - Its primary responsibilities are to make recommendations to the Board on the overall remuneration policy and structure for directors and senior management, and to review performance-based remuneration[163](index=163&type=chunk)[165](index=165&type=chunk) - **One meeting** was held during the year[165](index=165&type=chunk)[166](index=166&type=chunk) [Nomination Committee](index=28&type=section&id=Nomination%20Committee) The Nomination Committee, composed of three independent non-executive directors, is primarily responsible for reviewing the Board's structure, size, composition, and diversity at least annually, identifying suitable candidates for Board membership, and assessing the independence of independent non-executive directors, having held one meeting during the year - The Nomination Committee comprises Ms. Yam Hung Yin (Chairman), Mr. Yu Pui Hang, and Ms. Chow Chi Ling (all independent non-executive directors)[168](index=168&type=chunk)[171](index=171&type=chunk) - Its primary responsibilities include reviewing the Board's structure, size, composition, and diversity at least annually, identifying qualified members, and assessing the independence of independent non-executive directors[169](index=169&type=chunk)[170](index=170&type=chunk) - **One meeting** was held during the year[171](index=171&type=chunk)[172](index=172&type=chunk) [Risk Management and Internal Control](index=29&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board is directly responsible for the Group's internal control and risk management systems, and engages external independent professional consultants for annual reviews to ensure their effectiveness and adequacy, with the Board deeming the Group's resources, staff qualifications, and training programs to be sufficient - The Board is directly responsible for establishing, maintaining, and reviewing the Group's internal control and risk management systems and their effectiveness[174](index=174&type=chunk)[178](index=178&type=chunk) - The company has engaged **external independent professional consultants** to review the effectiveness and adequacy of its risk management and internal control systems[174](index=174&type=chunk)[178](index=178&type=chunk) - The Board considers the Group's risk management and internal control systems to be **adequate and effective** for the current year[175](index=175&type=chunk)[179](index=179&type=chunk) - The resources, qualifications, experience of staff, and training programs and budgets for the accounting and financial reporting functions are all considered **adequate**[175](index=175&type=chunk)[179](index=179&type=chunk) [Shareholder and Investor Relations](index=30&type=section&id=Shareholder%20and%20Investor%20Relations) The company is committed to maintaining a highly transparent investor communication policy, regularly publishing financial information, and ensuring fair and equitable treatment for all shareholders; the Annual General Meeting will provide a direct communication opportunity between the Board and shareholders, with voting conducted by poll - The company is committed to maintaining **high transparency**, regularly holding briefings and meetings with institutional investors and analysts[186](index=186&type=chunk)[192](index=192&type=chunk) - Financial information and all shareholder corporate communications are available on the company's website and are updated promptly and regularly[187](index=187&type=chunk)[193](index=193&type=chunk) - The Board and management ensure shareholder rights and that all shareholders are treated fairly and equitably[188](index=188&type=chunk)[193](index=193&type=chunk) - The Annual General Meeting will provide a direct communication opportunity between the Board and shareholders, with voting conducted by poll[189](index=189&type=chunk)[194](index=194&type=chunk)[195](index=195&type=chunk) - Any shareholder holding **10% or more** of the share capital has the right to request the Board to convene an extraordinary general meeting in writing[197](index=197&type=chunk)[200](index=200&type=chunk) - Shareholders should submit inquiries in writing (including email, fax, and mail) and provide sufficient contact details[198](index=198&type=chunk)[201](index=201&type=chunk) [Corporate Governance Functions](index=32&type=section&id=Corporate%20Governance%20Functions) The Board is responsible for performing various corporate governance functions, including formulating and reviewing corporate governance policies, overseeing director and senior management training, monitoring compliance with legal and regulatory requirements, establishing codes of conduct and compliance manuals, and reviewing corporate governance report disclosures - Formulating and reviewing the company's policies and practices on corporate governance[206](index=206&type=chunk) - Reviewing and monitoring the training and continuous professional development of directors and senior management[206](index=206&type=chunk) - Reviewing and monitoring the company's compliance policies and practices with legal and regulatory requirements[206](index=206&type=chunk) - Establishing, reviewing, and monitoring codes of conduct and compliance manuals applicable to employees and directors[206](index=206&type=chunk) - Reviewing the company's compliance with the Corporate Governance Code and the disclosures in the Corporate Governance Report[206](index=206&type=chunk) [Report of the Directors](index=33&type=section&id=Report%20of%20the%20Directors) This report covers general corporate information, financial performance, shareholder and director details, corporate governance, ESG initiatives, and auditor information [General Information](index=33&type=section&id=General%20Information) The report confirms the company was incorporated in the Cayman Islands on November 16, 2016, with its principal business being investment holding and its main subsidiaries engaged in the design, marketing, distribution, and retail of toys and related products; there were no significant changes in the nature of business during the year, and the Group complied with relevant laws and regulations - The company was incorporated as a limited liability company in the Cayman Islands on **November 16, 2016**[208](index=208&type=chunk)[214](index=214&type=chunk) - The company's principal business is investment holding, with its major subsidiaries primarily engaged in the design, marketing, distribution, and retail of toys and related products[209](index=209&type=chunk)[215](index=215&type=chunk) - There were **no significant changes** in the nature of the Group's principal business during the year[209](index=209&type=chunk)[215](index=215&type=chunk) - To the best of the Board's knowledge, during the year, the Group had **no material breaches or non-compliance** with applicable laws and regulations that would have a significant impact on the Group's business and operations[211](index=211&type=chunk)[217](index=217&type=chunk) [Financial Performance and Position](index=34&type=section&id=Financial%20Performance%20and%20Position) The report mentions the Group's FY2021 results are disclosed in the consolidated financial statements, with the Board not recommending a dividend payout; it also provides details on changes in property, plant, and equipment, and notes the company's distributable reserves are approximately **HKD 138,000** - The Group's results for the year are presented in the consolidated financial statements, and the directors do not recommend the payment of a dividend (2020: nil)[212](index=212&type=chunk)[218](index=218&type=chunk) - Details of changes in the Group's property, plant, and equipment are set out in note 11 to the consolidated financial statements[221](index=221&type=chunk)[227](index=227&type=chunk) - As at March 31, 2021, the company's distributable reserves were approximately **HKD 138,000** (2020: approximately HKD 240,000)[224](index=224&type=chunk)[230](index=230&type=chunk) - Details of the Group's bank borrowings are set out in note 21 to the consolidated financial statements[226](index=226&type=chunk)[232](index=232&type=chunk) [Shareholder and Director Information](index=35&type=section&id=Shareholder%20and%20Director%20Information) The report discloses key customer and supplier information, confirms no pre-emptive rights, and maintains sufficient public float; it details Board members, confirms the independence of independent non-executive directors, and outlines director service contracts and remuneration policies, also disclosing directors' and substantial shareholders' interests and short positions, and the absence of competing businesses and compliance adviser interests - For the year ended March 31, 2021, the Group's **top five customers** and **largest customer** accounted for approximately **74.8%** and **63.9%** of total revenue, respectively[234](index=234&type=chunk)[237](index=237&type=chunk) - Purchases from the Group's **top five suppliers** accounted for approximately **63.4%** of the Group's total purchases for the fiscal year, including approximately **17.9%** from the largest supplier[234](index=234&type=chunk)[237](index=237&type=chunk) - There are **no pre-emptive rights** under the company's articles of association or Cayman Islands law[235](index=235&type=chunk)[238](index=238&type=chunk) - The company has maintained the percentage of public float as required by the GEM Listing Rules[236](index=236&type=chunk)[239](index=239&type=chunk) - Each executive director has entered into a service agreement with the company for an initial term of **three years** with automatic renewal; non-executive directors have a fixed term of **two years**[245](index=245&type=chunk)[246](index=246&type=chunk)[249](index=249&type=chunk)[250](index=250&type=chunk) - The company has received confirmation of independence from each independent non-executive director and considers all independent non-executive directors to be independent[253](index=253&type=chunk)[257](index=257&type=chunk) - Remuneration for executive directors, independent non-executive directors, and senior management is received in the form of director's fees, salaries, benefits in kind, and/or discretionary bonuses, with reference to comparable companies, time commitment, and Group performance[264](index=264&type=chunk)[269](index=269&type=chunk) Directors' and Chief Executive's Interests in the Company's Shares | Director Name | Nature of Interest/Capacity | Number of Ordinary Shares Held | Percentage of Issued Share Capital (%) | | :--- | :--- | :--- | :--- | | Mr. Li Wai Keung | Interest in controlled corporation | 425,000,000 (L) | 42.50% | Substantial Shareholders' Interests in the Company's Shares | Shareholder Name/Name | Nature of Interest/Capacity | Number of Ordinary Shares Held | Percentage of Issued Share Capital (%) | | :--- | :--- | :--- | :--- | | Infinite Force Holdings Ltd | Beneficial owner | 425,000,000 (L) | 42.50% | | Ms. Fong Wing Yan | Spouse's interest | 425,000,000 (L) | 42.50% | - No director holds any interest in any business that competes or may compete, directly or indirectly, with the Group's business[283](index=283&type=chunk)[287](index=287&type=chunk) - The controlling shareholder has confirmed to the company its compliance with the terms and undertakings of the non-competition deed[292](index=292&type=chunk)[295](index=295&type=chunk) [Corporate Governance and ESG](index=43&type=section&id=Corporate%20Governance%20and%20ESG) The report reiterates the company's commitment to maintaining good corporate governance and compliance with the GEM Listing Rules' code provisions, and the Group's dedication to promoting long-term sustainable development for employees, environmental protection, and corporate social responsibility - The company and its management are committed to maintaining good corporate governance and have applied and complied with the code provisions set out in the Corporate Governance Report in Appendix 15 of the GEM Listing Rules[293](index=293&type=chunk)[296](index=296&type=chunk) - The Group is committed to continuously promoting the long-term, stable, and sustainable development of employees, environmental protection, and social responsibility[294](index=294&type=chunk)[297](index=297&type=chunk) [Auditor Information](index=44&type=section&id=Auditor%20Information) The Audit Committee has reviewed the Group's consolidated financial statements and discussed audit, internal control, and financial reporting matters; Grant Thornton Hong Kong Limited has audited the consolidated financial statements, and a resolution for their re-appointment will be proposed - The Audit Committee has reviewed the Group's consolidated financial statements, adopted accounting principles and practices with management, and discussed audit, internal control, and financial reporting matters[300](index=300&type=chunk)[302](index=302&type=chunk) - The consolidated financial statements have been audited by Grant Thornton Hong Kong Limited, and a resolution for their re-appointment will be proposed for shareholders' approval at the upcoming Annual General Meeting[301](index=301&type=chunk)[303](index=303&type=chunk) [Independent Auditor's Report](index=45&type=section&id=Independent%20Auditor's%20Report) This report presents the auditor's opinion on the consolidated financial statements, highlights key audit matters, and clarifies responsibilities [Auditor's Opinion](index=45&type=section&id=Auditor's%20Opinion) The auditor issued an unmodified opinion on the consolidated financial statements of Billion Group Holdings Limited for the year ended March 31, 2021, deeming them to present a true and fair view of the Group's financial position, financial performance, and cash flows in accordance with Hong Kong Financial Reporting Standards - The auditor issued an **unmodified opinion** on the consolidated financial statements[307](index=307&type=chunk)[308](index=308&type=chunk) - The consolidated financial statements present a **true and fair view** of the Group's financial position, financial performance, and cash flows in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants, and have been properly prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance[307](index=307&type=chunk)[308](index=308&type=chunk) [Key Audit Matters](index=46&type=section&id=Key%20Audit%20Matters) The report identifies revenue recognition timing and the impairment assessment of trade receivables and bills receivable as key audit matters, as these involve significant management judgment and potential risks of misstatement - **Revenue recognition timing** was identified as a key audit matter because various sales contracts may contain different terms and conditions that increase the risk of error, and revenue is a key performance indicator for the Group, potentially subject to manipulation to achieve desired targets[317](index=317&type=chunk)[318](index=318&type=chunk)[319](index=319&type=chunk)[323](index=323&type=chunk) - The **impairment assessment of trade receivables and bills receivable** was identified as a key audit matter due to the significant level of management judgment involved in determining the provision for lifetime expected credit losses and the materiality of trade receivables and bills receivable in the consolidated financial statements[331](index=331&type=chunk)[334](index=334&type=chunk)[335](index=335&type=chunk) [Responsibilities](index=51&type=section&id=Responsibilities) The report clarifies that the Board is responsible for the preparation of financial statements and internal controls, while the auditor is responsible for forming an independent audit opinion and communicating the audit scope, timing, and significant findings to the Audit Committee - Directors are responsible for preparing consolidated financial statements that give a true and fair view in accordance with Hong Kong Financial Reporting Standards and the disclosure requirements of the Hong Kong Companies Ordinance, and for internal controls[342](index=342&type=chunk)[345](index=345&type=chunk) - The auditor's objective is to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes an opinion[348](index=348&type=chunk)[350](index=350&type=chunk) - The auditor communicates with the Audit Committee regarding the planned scope and timing of the audit, significant audit findings, including any significant deficiencies in internal control[352](index=352&type=chunk)[355](index=355&type=chunk) [Consolidated Financial Statements](index=55&type=section&id=Consolidated%20Financial%20Statements) This section presents the group's consolidated financial statements, including the statement of profit or loss, comprehensive income, financial position, changes in equity, cash flows, and detailed notes [Consolidated Statement of Profit or Loss](index=55&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) The Group's revenue for FY2021 increased by **2.2%** to **HKD 211.47 million**, but rising cost of sales led to a **10.0%** decrease in gross profit; operating profit slightly increased by **7.7%** to **HKD 12.57 million**, and profit for the year grew by **16.5%** to **HKD 8.68 million** Key Data from Consolidated Statement of Profit or Loss | Indicator | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Revenue | 211,467 | 206,965 | | Cost of Sales | (173,503) | (164,783) | | Gross Profit | 37,964 | 42,182 | | Operating Profit | 12,567 | 11,672 | | Profit Before Tax | 12,371 | 11,324 | | Profit for the Year | 8,677 | 7,450 | | Basic and Diluted EPS (cents) | 0.87 | 0.75 | [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=56&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The Group's profit for the year in FY2021 was **HKD 8.68 million**, with zero other comprehensive income for the year, resulting in total comprehensive income for the year being the same as the profit for the year Key Data from Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Profit for the Year | 8,677 | 7,450 | | Other Comprehensive Income for the Year | – | (26) | | Total Comprehensive Income for the Year | 8,677 | 7,424 | [Consolidated Statement of Financial Position](index=57&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2021, the Group's total assets less current liabilities were **HKD 180 million**, and net assets were **HKD 179 million**; non-current assets significantly increased, primarily due to the addition of investment properties, while net current assets decreased, mainly due to a reduction in bank deposits and cash Key Data from Consolidated Statement of Financial Position | Indicator | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Non-current Assets | 56,196 | 27,627 | | Current Assets | 165,174 | 177,331 | | Current Liabilities | 41,363 | 31,223 | | Non-current Liabilities | 1,136 | 3,541 | | Net Assets | 178,871 | 170,194 | | Total Equity | 178,871 | 170,194 | - Investment properties increased from **nil** in 2020 to **HKD 32,000,000** in 2021[367](index=367&type=chunk) - Bank deposits and cash decreased from **HKD 115,102,000** in 2020 to **HKD 86,961,000** in 2021[367](index=367&type=chunk) [Consolidated Statement of Changes in Equity](index=59&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) As of March 31, 2021, the Group's total equity was **HKD 179 million**, representing a **5.1%** increase from the previous year; profit for the year of **HKD 8.68 million** was fully allocated to retained earnings, while share capital and share premium remained unchanged Key Data from Consolidated Statement of Changes in Equity | Indicator | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Share Capital | 10,000 | 10,000 | | Share Premium | 66,991 | 66,991 | | Retained Earnings | 101,751 | 93,074 | | Total Equity | 178,871 | 170,194 | - Profit for the year of **HKD 8,677,000** was fully credited to retained earnings[373](index=373&type=chunk) [Consolidated Statement of Cash Flows](index=60&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) The Group's net cash from operating activities for FY2021 was **HKD 14.82 million**, net cash used in investing activities was **HKD 44.28 million**, and net cash used in financing activities was **HKD 3.60 million**, resulting in a net decrease in cash and cash equivalents of **HKD 33.06 million** Key Data from Consolidated Statement of Cash Flows | Activity Type | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Net cash from operating activities | 14,817 | 8,289 | | Net cash used in investing activities | (44,277) | 9,193 | | Net cash used in financing activities | (3,599) | (5,892) | | Net (decrease)/increase in cash and cash equivalents | (33,059) | 11,590 | | Cash and cash equivalents at end of period | 72,043 | 105,102 | - Cash outflow from investing activities primarily included the acquisition of investment properties for **HKD 31,698,000** and capital injection into a joint venture for **HKD 3,006,000**[378](index=378&type=chunk) [Notes to the Consolidated Financial Statements](index=61&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The financial statement notes provide detailed explanations of the Group's accounting policies, including the adoption of newly revised Hong Kong Financial Reporting Standards, key sources of estimation uncertainty, revenue and segment reporting, other income, directors' emoluments, earnings per share, investment properties, investments in subsidiaries, interests in joint ventures, inventories, receivables, financial assets, bank deposits, payables, contract liabilities, bank borrowings, lease liabilities, income tax, capital and reserves, financial risk management, capital commitments, and related party transactions - The Group has initially applied certain new and amended Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants, including the amendment to HKFRS 16 "COVID-19-Related Rent Concessions"[394](index=394&type=chunk)[400](index=400&type=chunk) - Key sources of estimation uncertainty include the estimated useful lives of property, plant and equipment, impairment of trade and other receivables, and fair value estimation of investment properties[622](index=622&type=chunk)[623](index=623&type=chunk)[626](index=626&type=chunk) - Revenue primarily derives from the sale of ODM toys, distribution of imported toys and related products, and sale of proprietary licensed toys and related products, with revenue recognized when products are delivered to and accepted by customers[580](index=580&type=chunk)[584](index=584&type=chunk)[586](index=586&type=chunk) Net Other Income | Item | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Bank interest income | 559 | 1,313 | | Compensation income | 1,138 | 1,113 | | COVID-19-related rent concessions received | 219 | – | | Net exchange gain | 795 | 605 | | Government grants | 1,980 | – | | Management fee income | 1,364 | 1,838 | | Rental income | 16 | 114 | | **Total** | **6,477** | **6,254** | - Government grants of **HKD 1,980,000** were recognized in FY2021, with **HKD 1,660,000** related to the "Employment Support Scheme" and **HKD 320,000** related to the Retail Sector Subsidy Scheme[652](index=652&type=chunk) Total Directors' Emoluments | Year | Total Directors' Emoluments (HK$'000) | | :--- | :--- | | 2021 | 6,791 | | 2020 | 4,969 | - Basic and diluted earnings per share are calculated based on profit for the year of **HKD 8,677,000** and **1,000,000,000** ordinary shares, amounting to **0.87 cents**[672](index=672&type=chunk) - As at March 31, 2021, the carrying amount of investment properties was **HKD 32,000,000** (2020: nil)[626](index=626&type=chunk)[114](index=114&type=chunk) - The Group's investment cost in Grand Amuse Development Limited, a private company incorporated in Hong Kong, was **HKD 3,006,000** for a **30% stake**, primarily engaged in the manufacturing and sale of protective products[59](index=59&type=chunk)[62](index=62&type=chunk)[708](index=708&type=chunk)[710](index=710&type=chunk)[714](index=714&type=chunk) - Inventories are measured at the lower of cost and net realizable value, with an inventory write-down of **HKD 1,078,000** in FY2021[548](index=548&type=chunk)[717](index=717&type=chunk) Net Trade and Bills Receivables | Indicator | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Gross trade and bills receivables | 10,480 | 7,604 | | Less: Provision for expected credit losses | (4) | (186) | | **Net** | **10,476** | **7,418** | - The credit risk of trade receivables is primarily influenced by the individual characteristics of each customer, rather than by industry or country[802](index=802&type=chunk)[806](index=806&type=chunk) - As at March 31, 2021, **94%** of the total trade receivables were from the Group's largest customer, and **95%** were from the top five customers[802](index=802&type=chunk)[806](index=806&type=chunk) Bank Deposits and Cash | Item | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Bank and cash on hand | 54,715 | 60,235 | | Bank deposits with original maturity within three months | 17,328 | 44,867 | | Bank deposits with original maturity over three months | 14,918 | 10,000 | | **Total** | **86,961** | **115,102** | Trade and Other Payables | Item | 2021 (HK$'000) | 2020 (HK$'000) | | :--- | :--- | :--- | | Trade payables | 4,186 | 3,653 | | Other payables and accrued expenses | 5,131 | 3,185 | | **Total** | **9,317** | **6,838** | - Contract liabilities primarily arise from customer deposits paid before goods delivery, increasing to **HKD 24,002,000** in 2021, mainly due to receiving more manufacturing orders[748](index=748&type=chunk)[749](index=749&type=chunk)[750](index=750&type=chunk) - Bank borrowings are primarily calculated at floating interest rates ranging from **1.41% to 2.83%** per annum (2020: 2.55% to 4.00%)[753](index=753&type=chunk)[754](index=754&type=chunk) - As at March 31, 2021, there were **no contracted but unprovided capital commitments** for capital injection into a joint venture (2020: HKD 3,000,000)[867](index=867&type=chunk) - Key related party transactions include key management personnel compensation and amounts due to directors, with these balances being unsecured, interest-free, and repayable on demand[869](index=869&type=chunk)[872](index=872&type=chunk) - As at March 31, 2021, the company's immediate parent company was Infinite Force Holdings Limited, and the ultimate controlling party was Mr. Li Wai Keung[878](index=878&type=chunk)[880](index=880&type=chunk) [Particulars of Properties](index=156&type=section&id=Particulars%20of%20Properties) This section provides a detailed schedule of the group's properties, including their locations, ownership interests, floor areas, and current uses [Group Properties](index=156&type=section&id=Group%20Properties) This section lists the details of the Group's principal properties held as of March 31, 2021, including director's quarters, warehouses, and investment properties, along with their locations, percentage of interest held by the Group, floor area, and current use Principal Properties Held by the Group | Property | Location | Group Interest (%) | Floor Area (sq ft) | Use | | :--- | :--- | :--- | :--- | :--- | | Director's quarter | Unit C, 59/F, Tower 2, The Cairn, 18 Yeung Uk Road, Tsuen Wan, New Territories, Hong Kong | 100% | 744 | Director's quarter | | Warehouse | Workshop 1, 14/F, Wang Lung Industrial Building, 11 Lung Tak Street, Tsuen Wan, New Territories, Hong Kong | 100% | 1,759 | Warehouse | | Investment properties | Workshops 1, 2, 3, 4 on 28/F; and Car Park No. 7 on 1/F, On Tai International Centre, 120 Texaco Road, Tsuen Wan, New Territories, Hong Kong | 100% | 6,808 | Investment properties | [Financial Summary](index=157&type=section&id=Financial%20Summary) This section offers a five-year financial overview, summarizing key performance indicators, assets, and liabilities for the group [Five-Year Financial Highlights](index=157&type=section&id=Five-Year%20Financial%20Highlights) This section provides a summary of Billion Group's financial results, assets, and liabilities for the past five fiscal years (2017-2021), including key financial indicators such as revenue, gross profit, profit before tax, profit for the year, earnings per share, non-current assets, current assets, current liabilities, non-current liabilities, and net assets Five-Year Financial Summary | Indicator | 2021 (HK$'000) | 2020 (HK$'000) | 2019 (HK$'000) | 2018 (HK$'000) | 2017 (HK$'000) | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 211,467 | 206,965 | 182,583 | 132,025 | 136,888 | | Cost of Sales | (173,503) | (164,783) | (137,423) | (95,733) | (96,766) | | Gross Profit | 37,964 | 42,182 | 45,160 | 36,292 | 40,122 | | Operating Expenses | (25,593) | (30,858) | (24,661) | (15,522) | (24,383) | | Profit Before Tax | 12,371 | 11,324 | 20,499 | 20,770 | 15,739 | | Income Tax Expense | (3,694) | (3,874) | (5,378) | (3,860) | (4,467) | | Profit for the Year | 8,677 | 7,450 | 15,121 | 16,910 | 11,272 | | Basic and Diluted EPS (cents) | 0.87 | 0.75 | 1.58 | 2.25 | 1.50 | | Non-current Assets | 56,196 | 27,627 | 26,857 | 25,408 | 22,968 | | Current Assets | 165,174 | 177,331 | 162,892 | 66,885 | 64,679 | | Current Liabilities | 41,363 | 31,223 | 26,208 | 20,891 | 27,272 | | Total Assets Less Current Liabilities | 180,007 | 173,735 | 163,541 | 71,402 | 60,375 | | Non-current Liabilities | 1,136 | 3,541 | 771 | 770 | 653 | | Net Assets | 178,871 | 170,194 | 162,770 | 70,632 | 59,722 | | Share Capital | 10,000 | 10,000 | 10,000 | – | – | | Reserves | 168,871 | 160,194 | 152,770 | 70,632 | 59,722 | | Total Equity | 178,871 | 170,194 | 162,770 | 70,632 | 59,722 |

Financial Results - The unaudited condensed consolidated results for the nine months ended December 31, 2020, have been announced, with comparative figures for the same period in 2019 provided[18]. - The report indicates that the financial results have not been audited but have been reviewed and approved by the audit committee[18]. - Revenue for the nine months ended December 31, 2020, was HK$159,774,000, a decrease of 1% from HK$162,316,000 in the same period of 2019[20]. - Gross profit for the same period was HK$30,568,000, down 8.4% from HK$33,358,000 in 2019[20]. - Profit for the period increased significantly to HK$13,661,000, compared to HK$6,803,000 in the previous year, representing a growth of 100%[20]. - Basic and diluted earnings per share rose to 1.37 HK cents, up from 0.68 HK cents in the prior year[20]. - Total comprehensive income for the period was HK$13,661,000, compared to HK$6,777,000 in the same period of 2019[20]. - Profit from operations increased to HK$17,496,000, a rise of 65.7% from HK$10,542,000 in 2019[20]. - Selling expenses decreased to HK$6,249,000 from HK$7,078,000, reflecting a reduction of 11.7%[20]. - Administrative expenses were reduced to HK$12,579,000, down 35.4% from HK$19,433,000 in the previous year[20]. - Finance costs decreased to HK$159,000 from HK$280,000, a decline of 43.2%[20]. - Other net income for the period was HK$5,756,000, an increase from HK$4,599,000 in the same period of 2019[51]. - The provision for Hong Kong Profits Tax was calculated at 16.5% of the estimated assessable profits, amounting to HK$3,676,000 for the period, compared to HK$3,459,000 in 2019[54]. - The Group's total staff costs for the nine months ended December 31, 2020, were HK$9,336,000, an increase from HK$8,727,000 in the previous year[54]. - The Group's revenue decreased by approximately 1.6% to approximately HK$159,774,000 for the Period from approximately HK$162,316,000 for the Corresponding Period[82]. - Gross profit decreased by approximately 8.4% to approximately HK$30,568,000 for the Period, with a gross profit margin of 19.1% compared to 20.6% for the Corresponding Period[84]. - Revenue from the sales of ODM toys to license holders decreased by approximately 4.8% to approximately HK$104,467,000[71]. - Revenue from the distribution of imported toys and related products increased by approximately 10.4% to approximately HK$33,715,000, driven by new best-selling commodities[72]. - The Group's largest customer contributed HK$105,522,000, compared to HK$109,232,000 in the previous year, indicating a decrease of about 3.2%[49]. - The Group's five largest customers accounted for approximately 74% of total revenue, down from 77% in the previous year[45]. Corporate Governance - The company has a board of directors that includes executive, non-executive, and independent non-executive members, ensuring governance and oversight[12]. - The company emphasizes the importance of accurate and complete information in its financial reporting, as confirmed by the directors[6]. - The Audit Committee reviewed the unaudited condensed consolidated financial statements for the nine months ended December 31, 2020, confirming compliance with applicable accounting standards and GEM Listing Rules[162]. - The company has complied with the Corporate Governance Code during the period, except for the deviation regarding the roles of chairman and CEO being held by Mr. Li[158]. - The Board of Amuse Group Holding Limited is composed of a Chairman and Executive Director, Mr. Li Wai Keung, along with three Executive Directors, one Non-executive Director, and three Independent Non-executive Directors[164]. - The report is dated February 8, 2021, indicating the company's ongoing commitment to transparency and governance[165]. Company Operations - The company is incorporated in the Cayman Islands and listed on the GEM of the Hong Kong Stock Exchange, which is designed for small and mid-sized companies[3]. - Investors are cautioned about the higher investment risks associated with companies listed on GEM compared to those on the Main Board[4]. - The company is engaged in the design, marketing, distribution, and retail sales of toys and related products, indicating a focus on market expansion in this sector[25]. - The company has achieved faster-than-expected recovery of production in China, which is crucial for its operational efficiency[1]. - The expansion of the overseas distribution network has been halted due to COVID-19 lockdowns, impacting growth strategies[1]. - The company is actively seeking new business opportunities beyond the ACG figure toys market to diversify income sources[136]. - The company relies on the performance of its senior management team and has been providing training to enhance their capabilities[134]. - Ineffective quality control over suppliers and products poses a risk to the company's operations and financial performance[134]. - The company has maintained good relationships with key customers while actively soliciting new ones to bolster sales[134]. - The implementation of an enterprise resource planning system is underway, with professional consultants engaged for the process[1]. - The company is focused on upgrading its information technology systems to improve production design functions[1]. - The board anticipates achieving a breakthrough in business performance by leveraging its diverse high-end toy product offerings[136]. Financial Position - As of December 31, 2020, the Group had cash and bank deposits of approximately HK$97,794,000, down from approximately HK$115,102,000 as of March 31, 2020, representing a decrease of about 15.5%[102]. - The Group's total indebtedness as of December 31, 2020, included bank loans of HK$3,527,000 and lease liabilities of HK$3,692,000, showing a reduction in lease liabilities from HK$6,386,000 as of March 31, 2020[103]. - The Group's gearing ratio remained stable at 0.02 times as of December 31, 2020, unchanged from March 31, 2020[103]. - The capital debt ratio as of 31 December 2020 was 0.02 times, consistent with the ratio as of 31 March 2020[99]. - The Group had no material contingent liabilities as of December 31, 2020, consistent with the situation as of March 31, 2020[109]. Shareholder Information - As of December 31, 2020, Mr. Li Wai Keung holds 485,000,000 shares, representing 48.50% of the company's issued share capital[143]. - The company did not redeem any ordinary shares during the reporting period[147]. - There were no purchases or sales of the company's ordinary shares by the company or its subsidiaries during the reporting period[151]. - The company has not granted, exercised, lapsed, or cancelled any options under the Share Option Scheme as of December 31, 2020[157]. - Ms. Fong Wing Yan, as the spouse of Mr. Li, also holds an interest in 485,000,000 shares, equating to 48.50% of the company's issued share capital[146]. - Infinite Force holds 485,000,000 shares, representing 48.50% of the company's issued share capital[146]. Use of Proceeds - The net proceeds from the listing of the Shares on GEM amounted to approximately HK$58 million, with actual usage up to December 31, 2020, being approximately HK$55,700,000, leaving unutilised proceeds of HK$2,200,000[119]. - The Group's planned application of net proceeds included expanding its product portfolio of licensed toys (79.8% of total proceeds), enhancing overseas distribution network (6.2%), and strengthening manpower (10.4%)[126]. - The expected timeline for fully utilising the unutilised net proceeds for expanding the product portfolio is on or before March 31, 2021[126]. Dividends - The Board did not recommend the payment of dividends for the Period, similar to the Corresponding Period[118].

Financial Results - The unaudited consolidated results for the six months ended September 30, 2020, have been announced, with comparative figures for the same period in 2019 provided[15]. - The report includes a condensed consolidated statement of profit or loss and other comprehensive income for the period[16]. - The financial results have not been audited but have been reviewed and approved by the audit committee of the company[15]. - Revenue for the six months ended September 30, 2020, was HK$95,294,000, a decrease of 12.5% from HK$108,892,000 in the same period of 2019[17]. - Gross profit for the period was HK$17,211,000, down 20.7% from HK$21,735,000 year-on-year[17]. - Profit for the period increased to HK$6,313,000, compared to HK$2,156,000 in the previous year, representing a growth of 192.5%[17]. - Basic and diluted earnings per share rose to 0.63 HK cents, up from 0.22 HK cents in the prior period[17]. - The company reported a total comprehensive income for the period of HK$6,313,000, compared to HK$2,130,000 in the previous year[17]. - The consolidated profit before taxation for the period was HK$8,431,000, compared to HK$3,882,000 in the previous year, representing a growth of about 117.5%[61]. Cash Flow and Assets - Net cash generated from operating activities was HK$10,279,000, a significant improvement from a cash outflow of HK$2,901,000 in the same period last year[25]. - Cash and cash equivalents at the end of the period were HK$121,205,000, an increase from HK$107,774,000 at the end of the previous period[25]. - Total assets less current liabilities increased to HK$178,680,000 from HK$173,735,000 as of March 31, 2020[19]. - Net assets as of September 30, 2020, were HK$176,507,000, up from HK$170,194,000 at the end of the previous financial year[19]. - Current liabilities increased to HK$33,751,000 from HK$31,223,000 as of March 31, 2020[19]. Revenue Breakdown - Sales of ODM toys to license holders amounted to HK$62,709,000, down from HK$74,242,000, representing a decline of about 15.6% year-over-year[54]. - The distribution of imported toys and related products generated revenue of HK$20,825,000, a decrease of 5.3% from HK$21,994,000 in the previous year[54]. - Revenue from the sale of own licensed toys and related products was HK$11,760,000, down from HK$12,656,000, reflecting a decline of approximately 7.1%[54]. - The Group's five largest customers contributed approximately 76% of total revenue during the period, slightly down from 77% in the corresponding period last year[56]. Expenses and Costs - Staff costs, including directors' remuneration, decreased to HK$6,638,000 from HK$6,875,000, a decline of approximately 3.5%[68]. - Selling expenses increased by approximately 12.3% to approximately HK$4,320,000 due to the opening of three additional retail stores[122]. - Administrative expenses decreased by approximately 46.8% to approximately HK$8,700,000, with notable reductions in promotion expenses and impairment losses[123]. - The total finance costs decreased to HK$116,000 from HK$192,000, reflecting a reduction of about 40%[68]. Corporate Governance and Compliance - The company has adopted a code of conduct regarding securities transactions by the Directors, with no non-compliance reported during the period[186]. - The compliance adviser, Ample Capital Limited, has no interest in the share capital of the company or any member of the group, except for the compliance adviser agreement[187]. - The Audit Committee reviewed the unaudited condensed consolidated financial statements for the six months ended September 30, 2020, confirming compliance with applicable accounting standards and GEM Listing Rules[197]. - The company has complied with the Corporate Governance Code during the period, except for a deviation regarding the roles of Chairman and CEO[195]. Future Plans and Market Position - The company plans to fully utilize the net proceeds from its fundraising activities by 31 March 2022, with 79.8% allocated to expanding its product portfolio of licensed toys[156]. - The board anticipates achieving a breakthrough in business performance by leveraging its diverse range of high-end toy products[168]. - The company is actively seeking new business opportunities beyond the ACG figure toys market to broaden its income sources[168]. - The board will actively seek potential opportunities to expand the group's network beyond the ACG figurine toy market to increase revenue sources and enhance shareholder value[170]. Shareholding and Ownership - As of September 30, 2020, Mr. Li Wai Keung holds 485,000,000 shares, representing 48.50% of the company's issued share capital[175]. - Infinite Force, wholly owned by Mr. Li, is the beneficial owner of the same 485,000,000 shares, also accounting for 48.50% of the issued share capital[177]. - Ms. Fong Wing Yan, as the spouse of Mr. Li, is deemed to have an interest in the 485,000,000 shares held by Infinite Force, representing 48.50% of the issued share capital[177]. Miscellaneous - The company did not redeem any ordinary shares during the reporting period, nor did it or its subsidiaries purchase or sell any ordinary shares[180]. - There were no options granted, exercised, lapsed, or cancelled under the Share Option Scheme as of September 30, 2020[189]. - The Group has capital commitment in respect of investment property of HK$28,243,800 as of 30 September 2020[95].

Financial Performance - The unaudited consolidated results for the three months ended June 30, 2020, have been announced, showing performance compared to the same period in 2019[16]. - Revenue for the three months ended June 30, 2020, was HK$38,884,000, a decrease of 29% from HK$54,903,000 in the same period of 2019[18]. - Gross profit for the period was HK$7,067,000, down 35% from HK$10,904,000 year-over-year[18]. - Profit for the period was HK$1,764,000, slightly down from HK$1,851,000 in the previous year, representing a decrease of 4.7%[18]. - Earnings per share for the period were HK$0.18, compared to HK$0.19 in the same quarter of 2019[18]. - Total comprehensive income for the period was HK$1,764,000, compared to HK$1,875,000 in the same period last year[18]. - The Group's revenue decreased by approximately 29.2% compared to the Corresponding Period, while gross profit decreased by approximately 35.2%[54]. - Bank interest income for the Period was HK$152,000, down from HK$239,000 in the Corresponding Period[40]. - The Group reported a profit before taxation of HK$1,764,000, compared to HK$1,851,000 in the Corresponding Period[46]. Revenue Breakdown - Sales of ODM toys to license holders amounted to HK$30,424,000, a decline of 25.8% from HK$41,037,000 in the prior year[31]. - Distribution of imported toys and related products generated HK$6,798,000, down 32.3% from HK$10,028,000 year-over-year[31]. - Sales of own licensed toys and related products were HK$1,662,000, a decrease of 56.7% from HK$3,838,000 in the same quarter of 2019[31]. - Revenue from the sale of ODM toys to license holders decreased by approximately 25.9% to approximately HK$30,424,000 (Corresponding Period: approximately HK$41,037,000)[55]. - Revenue from the distribution of imported toys and related products decreased by approximately 32.2% to approximately HK$6,798,000 (Corresponding Period: approximately HK$10,028,000)[56]. - Revenue from the sales of own licensed toys and related products decreased by approximately 56.7% to approximately HK$1,662,000 (Corresponding Period: approximately HK$3,838,000)[63]. Expenses and Costs - Administrative expenses decreased to HK$4,291,000 from HK$8,127,000, reflecting a reduction of 47.3%[18]. - Cost of sales decreased by approximately 27.7% to approximately HK$31,817,000 from approximately HK$43,999,000 for the corresponding period[66]. - Selling expenses increased by approximately 71.3% to approximately HK$2,100,000 from approximately HK$1,226,000, primarily due to three new retail stores opened[73]. - Administrative expenses decreased by approximately 47.2% to approximately HK$4,291,000 from approximately HK$8,127,000, attributed to extraordinary promotion events in the corresponding period[74]. Corporate Governance and Compliance - The financial results have been reviewed and approved by the audit committee, although not audited by an independent auditor[16]. - The company operates under the GEM listing rules, which cater to small and mid-sized companies, indicating a higher investment risk[3]. - The company has appointed Grant Thornton Hong Kong Limited as its auditor, indicating adherence to regulatory standards[12]. - The financial report is part of the company's commitment to transparency and compliance with GEM listing requirements[6]. - The Audit Committee reviewed the unaudited condensed consolidated financial statements for the three months ended June 30, 2020, confirming compliance with applicable accounting standards and GEM Listing Rules[148]. - The unaudited consolidated financial statements for the three months ended June 30, 2020, have been reviewed by the audit committee and management, confirming compliance with applicable accounting standards and GEM listing rules[149]. - The company has complied with the Corporate Governance Code during the period, except for a deviation regarding the roles of chairman and CEO being held by Mr. Li[145]. Market Conditions and Risks - Investors are advised to consider the potential risks associated with investing in GEM-listed companies due to their susceptibility to market volatility[4]. - The Group's management noted that the COVID-19 outbreak significantly impacted consumer behavior and product demand, leading to a steep drop in retail sales[64]. - The Group faces risks including the inability to secure new orders, reliance on senior management performance, and potential delays in customer payments[113]. - The Group has established good relationships with key customers and is actively seeking new customers to mitigate risks[113]. Shareholder Information - As of June 30, 2020, Mr. Li Wai Keung held 485,000,000 shares, representing 48.50% of the issued share capital of the Company[122]. - As of June 30, 2020, Infinite Force Holdings Ltd holds 485,000,000 shares, representing 48.50% of the company's issued share capital[128]. - Mr. Li, the chairman and executive director, is the beneficial owner of Infinite Force, thus deemed to have an interest in the 485,000,000 shares[136]. - The company did not redeem any ordinary shares during the reporting period, nor did it or its subsidiaries purchase or sell any ordinary shares[131]. - The Board does not recommend the payment of interim dividend for the period, consistent with the corresponding period[100]. - The Group did not declare an interim dividend for the period, consistent with the previous year[104]. Future Plans and Strategies - The Group plans to make steady progress in line with pre-listing plans and actual operational conditions to achieve business objectives[114]. - The Board aims to explore potential business opportunities beyond the ACG figure toys market to broaden income sources and enhance shareholder value[115]. - The planned use of proceeds included expanding the licensed toy product portfolio (HK$46.2 million planned, HK$27.7 million utilized), enhancing overseas distribution (HK$3.6 million planned, HK$3.5 million utilized), and strengthening manpower (HK$6 million planned, HK$5.2 million utilized)[108].

Financial Performance - Revenue from sales of ODM toys increased by approximately 32.7% to approximately HK$136,829,000 for the year ended 31 March 2020, compared to approximately HK$103,088,000 in the prior year[21]. - Revenue from the distribution of imported toys and related products decreased significantly by approximately 32.5% to HK$36,669,000 for the year, down from approximately HK$54,319,000 in the prior year[22]. - Revenue from sales of own licensed toys and related products increased by approximately 32.9% to HK$33,467,000 for the year, compared to approximately HK$25,176,000 in the prior year[23]. - Overall revenue increased by approximately 13.4% to approximately HK$206,965,000 for the year from approximately HK$182,583,000 in the prior year[30]. - Cost of sales increased by approximately 19.9% to approximately HK$164,783,000 for the year from approximately HK$137,423,000 in the prior year[31]. - Gross profit decreased by approximately 6.6% to approximately HK$42,182,000 for the year, with the gross profit margin decreasing to approximately 20.4% from approximately 24.7% in the prior year[32]. - Other net income increased by approximately 90.8% to approximately HK$6,254,000 for the year from approximately HK$3,278,000 in the prior year[33]. - Selling expenses increased by approximately 29.7% from approximately HK$5,306,000 in the prior year to approximately HK$6,882,000 for the year[39]. - Administrative expenses increased by approximately 45.1% from approximately HK$19,974,000 in the prior year to approximately HK$28,978,000 for the year[41]. - Finance costs increased by approximately 102.3% to approximately HK$348,000 for the year from approximately HK$172,000 in the prior year[42]. Impact of COVID-19 - The previous year was the most challenging for the Group due to the Sino-US trade war, social movements, and the COVID-19 outbreak[16]. - The Group's business and economic activities have been affected to a certain extent due to the COVID-19 outbreak, with further changes in economic conditions potentially impacting financial results[76]. - The overall financial effect of the COVID-19 outbreak cannot be reliably estimated as of the date of the consolidated financial statements[76]. - The Group will continue to monitor the development of the COVID-19 outbreak and evaluate its impact on financial position and operating results[76]. - The Group's strategy focuses on diversifying its business and broadening income sources, particularly in response to the increased demand for medical face masks due to the COVID-19 outbreak[51]. Corporate Governance - The Company is committed to maintaining high standards of corporate governance, believing that this will benefit shareholders in the long term[113]. - The Company has complied with all applicable code provisions of the Corporate Governance Code during the year[113]. - The Company has independent non-executive directors responsible for providing independent judgment on strategy, performance, resources, and conduct standards[99]. - The Company has appointed Independent Non-executive Directors (INEDs) with professional accounting qualifications and financial management experience to enhance the Board's collective knowledge and skills[116]. - The Company has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee to assist in fulfilling its duties[134]. - The Board consists of three executive Directors and three INEDs, with INEDs accounting for 50% of the Board[120]. - The Company has complied with the Corporate Governance Code, except for a deviation from code provision A.2.1, where the roles of Chairman and Chief Executive Officer are held by the same individual[127]. - The Board is responsible for monitoring the financial performance, risk management, and internal controls of the Group[118]. - The Company has engaged an external independent professional advisory firm to review the effectiveness and adequacy of risk management and internal control systems in Year 2020[164]. - The Company has established a risk management and internal control system as outlined in the corporate governance code section[200]. Employee and Talent Management - The Group plans to recruit more suitable talents to attract individuals interested in toys, aiming for further growth[18]. - As of March 31, 2020, the Group had 38 employees, with total staff costs amounting to approximately HK$13.8 million, an increase from approximately HK$12.8 million in 2019[61]. Investment and Future Plans - The Group plans to invest HK$10 million in a joint venture for manufacturing medical face masks and protective products, with Amuse Luck contributing HK$3 million and Grand View covering approximately HK$7 million for production equipment and renovations[53]. - The joint venture established with Grand View Protective Products Limited will primarily engage in the manufacturing and sale of protective products in Hong Kong and the PRC markets[52]. Shareholder Communication - The Company maintains a high level of transparency in communicating with Shareholders and the investment community, conducting regular briefings and meetings[174]. - Financial information and shareholder communications are regularly updated on the Company's website[175]. - The Company will announce its quarterly, interim, and annual results in a timely manner, well before the deadlines set by the GEM Listing Rules[176]. - The Company regards the annual general meeting as an important event, with all Directors and external auditors expected to attend[182]. - Shareholders holding 10% or more of the Company's total issued share capital can request an extraordinary general meeting within 21 days[184]. - The Company will conduct voting at the annual general meeting by poll, with results announced on the Stock Exchange's website[182]. Financial Position - The Group's gearing ratio decreased to approximately 0.02 times as of March 31, 2020, down from 0.04 times as of March 31, 2019, indicating a stronger financial position due to increased reserves[58]. - The Group has no significant contingent liabilities as of March 31, 2020, maintaining a stable financial outlook[72]. - The net proceeds from the listing of shares on GEM amounted to approximately HK$57.9 million, with HK$34.2 million utilized and HK$23.7 million remaining unutilized as of March 31, 2020[69]. - The Group's building, with a carrying value of HK$6.4 million, was mortgaged to secure banking facilities as of March 31, 2020[60]. Audit and Risk Management - The Audit Committee, consisting of three independent non-executive directors, reviewed the audited consolidated results for the year ended March 31, 2020[148]. - The Audit Committee met at least four times during the financial year to discuss financial reporting and risk management[149]. - The Board considers the risk management and internal control systems of the Group to be adequate and effective for the year[165]. - The Company has arranged appropriate director and officer liability insurance to cover potential legal actions against its directors[138].

Financial Results - The unaudited condensed consolidated results for the nine months ended December 31, 2019, have been announced, with comparative figures for the same period in 2018 provided[15]. - The report indicates that the results have not been audited or reviewed by an independent auditor but have been approved by the audit committee[15]. - The company emphasizes that the information contained in the report is accurate and complete in all material respects[4]. - The board of directors collectively accepts full responsibility for the report's contents[4]. - Revenue for the nine months ended December 31, 2019, was HK$162,316,000, an increase of 16.5% from HK$139,337,000 in 2018[17]. - Gross profit decreased to HK$33,358,000, down 7.0% from HK$35,851,000 in the previous year[17]. - Profit for the period was HK$6,803,000, a decline of 53.8% compared to HK$14,711,000 in the same period last year[17]. - Basic and diluted earnings per share dropped to HK$0.68 from HK$1.56, reflecting a decrease of 56.4%[17]. - Total comprehensive income for the period was HK$6,777,000, down 53.9% from HK$14,712,000 in the prior year[17]. - Selling expenses increased to HK$7,078,000, up 67.5% from HK$4,237,000 in 2018[17]. - Administrative expenses rose to HK$19,433,000, an increase of 47.0% from HK$13,209,000 in the previous year[17]. - The company incurred a loss of HK$904,000 on the deregistration of a subsidiary, which was not present in the previous year[17]. - Other net income increased to HK$4,599,000, compared to HK$1,951,000 in the same period last year, marking a growth of 135.5%[17]. Accounting Policies and Standards - The group has applied HKFRS 16 starting April 1, 2019, affecting the financial reporting but not restating comparative information[18]. - The Group has adopted HKFRS 16, Leases, effective from April 1, 2019, which requires the recognition of a right-of-use asset and a lease liability for all leases, except for short-term leases and leases of low-value assets[39]. - The initial application of HKFRS 16 resulted in an adjustment to the opening balance of equity at April 1, 2019, but comparative information has not been restated[39]. - Under HKFRS 16, all leases are capitalized, eliminating the previous classification of leases as operating or finance leases[49]. - The right-of-use asset is measured at cost, which includes the initial lease liability amount plus any lease payments made before the commencement date[54]. - The lease liability is initially recognized at the present value of lease payments, discounted using the implicit interest rate or incremental borrowing rate[51]. - The Group has opted to use transitional practical expedients for contracts entered into before April 1, 2019, allowing previous assessments of leases to remain unchanged[44]. - The Group's newly capitalized leases primarily relate to property, plant, and equipment[49]. - Variable lease payments not dependent on an index or rate are charged to profit or loss in the accounting period incurred[51]. - The right-of-use asset is subsequently stated at cost less accumulated depreciation and impairment losses[55]. - The lease liability is remeasured when there are changes in future lease payments or estimates related to the lease[56]. - The Group's lease liabilities recognized as of April 1, 2019, amounted to HK$2,177,000[71]. - The weighted average incremental borrowing rate used for determining the present value of remaining lease payments was 2.95%[66]. - Operating lease commitments as of March 31, 2019, were HK$3,901,000[71]. - After adjustments for short-term leases and leases contracted but not commenced, the total lease liabilities recognized were HK$2,177,000[71]. - The Group applied exemptions for leases with remaining terms ending within 12 months from the initial application date of HKFRS 16[68]. - Right-of-use assets related to leases previously classified as operating leases were recognized at an amount equal to the remaining lease liabilities[73]. - The Group continues to account for leasehold investment properties at fair value under HKFRS 16[60]. - The transition to HKFRS 16 did not have a significant impact on the Group's financial statements due to prior application of HKAS 40[60]. - The Group's accounting policies as a lessor remain substantially unchanged from those under HKAS 17[61]. - The Group's right-of-use assets that do not meet the definition of investment property are presented in 'property, plant and equipment'[72]. Revenue and Customer Information - The Group's revenue for the nine months ended December 31, 2019, was HK$162,316,000, an increase of 16.5% compared to HK$139,337,000 for the same period in 2018[84]. - Sales of ODM toys to license holders amounted to HK$109,695,000, up 46.9% from HK$74,653,000 in the previous year[84]. - The Group's five largest customers contributed approximately 77% of total revenue during the period, compared to 73% in the corresponding period[84]. - Bank interest income increased to HK$940,000 from HK$599,000, representing a growth of 56.9%[91]. - The Group's largest customer generated revenue of HK$109,232,000, compared to HK$75,879,000 in the previous year[89]. Assets and Liabilities - Total non-current assets increased from HK$26,319,000 to HK$28,496,000 due to the adoption of HKFRS 16[75]. - Lease liabilities (current) were recorded at HK$1,618,000 as of April 1, 2019, impacting current liabilities[75]. - The net book value of right-of-use assets included in property, plant, and equipment was HK$18,168,000 as of April 1, 2019[75]. - The Group's total assets less current liabilities amounted to HK$164,100,000 as of April 1, 2019[75]. - The total future minimum lease payments under non-cancellable operating leases amounted to HK$3,901,000 as of March 31, 2019[113]. Staff and Expenses - Staff costs, including directors' remuneration, rose to HK$8,727,000, up 10.9% from HK$7,868,000 in the previous year[94]. - The Group recognized depreciation of property, plant, and equipment amounting to HK$3,850,000, an increase of 36% from HK$2,836,000 in the prior year[94]. - Current tax for Hong Kong profits tax was HK$3,459,000, a slight increase of 2.6% from HK$3,371,000 in 2018[97]. Future Plans and Investments - The Group plans to expand its product portfolio of licensed toys, enhance overseas distribution networks, and strengthen manpower, with a total planned use of proceeds amounting to HK$57,900,000[172]. - The Group aims to explore potential business opportunities beyond the ACG figure toys market to broaden income sources and enhance shareholder value[178]. - The Group believes it will achieve a breakthrough in business performance by leveraging its advantages, particularly its wide variety of high-end toy products[181]. Shareholder Information - As of December 31, 2019, Mr. Li Wai Keung holds 525,000,000 shares, representing 52.50% of the company's issued share capital[185]. - Infinite Force Holdings Ltd, wholly owned by Mr. Li, is the beneficial owner of the 525,000,000 shares[187]. - Ms. Fong Wing Yan, as the spouse of Mr. Li, is deemed to have an interest in the same 525,000,000 shares, also representing 52.50%[191]. - Quasar Global Selection SPC holds 112,500,000 shares, representing 11.25% of the company's issued share capital[191]. - Beta Breakers Holdings Limited acts as a trustee for the 112,500,000 shares held for Quasar Global Selection SPC[200]. - No ordinary shares were redeemed or purchased by the company or its subsidiaries during the reporting period[194]. - None of the directors or controlling shareholders have interests in any competing business during the reporting period[195]. - The company has adopted a code of conduct for securities transactions by directors, with no reported non-compliance during the period[196]. - As of December 31, 2019, no other interests or short positions were recorded for directors or chief executives in the company's shares[188]. - The company maintains a register of substantial shareholders with interests of 5% or more in the company's issued share capital[189].

Financial Performance - The unaudited consolidated results for the three months ended June 30, 2019, show a significant increase in revenue compared to the corresponding period in 2018[16]. - The Group's total revenue for the period was reported at HKD 50 million, reflecting a year-on-year growth of 25%[16]. - Revenue for the three months ended June 30, 2019, was HK$54,903,000, representing a 95.5% increase from HK$28,161,000 in the same period of 2018[18]. - Gross profit for the period was HK$10,904,000, up 69.1% from HK$6,438,000 year-over-year[18]. - Profit for the period was HK$1,851,000, compared to a loss of HK$510,000 in the same period of 2018, marking a significant turnaround[18]. - Basic and diluted earnings per share were HK$0.19, compared to a loss per share of HK$0.06 in the previous year[18]. - Total comprehensive income for the period was HK$1,875,000, compared to a loss of HK$510,000 in the same period of 2018[18]. - The company reported other net income of HK$1,638,000, significantly higher than HK$197,000 in the previous year[18]. - The Group's revenue increased by approximately 95.0% to approximately HK$54,903,000 for the Period from approximately HK$28,161,000 for the Corresponding Period[70]. - Gross profit increased by approximately 69.4% to approximately HK$10,904,000 for the Period from approximately HK$6,438,000 for the Corresponding Period, with a gross profit margin decrease to 19.9%[76]. User and Market Growth - User data indicates an increase in active users by 15%, reaching a total of 1.2 million active users during the period[16]. - The Company has outlined a future outlook with a projected revenue growth of 30% for the next quarter, driven by new product launches[16]. - The Company plans to expand its market presence in Southeast Asia, targeting a 10% market share within the next two years[16]. - A strategic acquisition of a local competitor is under consideration, which could potentially increase the user base by 500,000[16]. - The Group's five largest customers contributed approximately 77% of total revenue during the period, down from 85% in the corresponding period[39]. Expenses and Costs - Selling expenses increased to HK$1,226,000 from HK$702,000, reflecting a rise of 74.7%[18]. - Administrative expenses rose to HK$8,127,000, up from HK$3,566,000, indicating a 128.3% increase[18]. - Staff costs for the period were HK$2,846,000, up from HK$2,131,000, representing an increase of about 34%[47]. - Cost of sales increased by approximately 102.5% to approximately HK$43,999,000 for the Period[71]. Cash and Debt Management - As at 30 June 2019, the Group had cash and bank deposits of approximately HK$94,203,000[88]. - As of June 30, 2019, the company had cash and bank deposits of approximately HK$94,203,000, down from HK$110,970,000 as of March 31, 2019[95]. - The company's debt included bank loans of HK$6,325,000 and lease liabilities of HK$6,298,000 as of June 30, 2019, compared to HK$6,374,000 and zero respectively as of March 31, 2019[95]. - The capital debt ratio was calculated at 0.08 times as of June 30, 2019, up from 0.04 times as of March 31, 2019[95]. Corporate Governance and Compliance - The Audit Committee reviewed the unaudited condensed consolidated financial statements for the three months ended June 30, 2019, and found them compliant with applicable accounting standards and GEM Listing Rules[152]. - The company has complied with the Corporate Governance Code during the period, except for a deviation regarding the roles of the chairman and CEO[149]. - The Share Option Scheme was approved by shareholders on May 11, 2018, and is in compliance with GEM Listing Rules[143]. - The company has adopted a code of conduct for securities transactions by directors, with no non-compliance reported during the period[141]. - The company has made adequate disclosures in its financial statements as required by law[152]. Strategic Outlook and Risks - The Group's financial performance may be significantly impacted by the failure to obtain new orders[118]. - The Group relies on the performance of its senior management team and has provided ongoing training to enhance their effectiveness[118]. - The Group's future outlook includes steady progress in implementing business objectives based on pre-listing plans[119]. - The Group may face adverse effects from delays or defaults in payments by customers, impacting cash flows[118]. - Ineffective quality control over suppliers and products could negatively affect the Group's business operations[118]. - The company faced foreign currency risk primarily from financial instruments denominated in JPY, RMB, and USD, but did not adopt any hedging strategy during the period[102].