Economic Performance - The Chinese economy showed a strong recovery with a GDP growth of 4.5% in Q1 2023 compared to the same period in 2022, indicating a rebound in consumer spending with retail sales increasing by 5.8% year-on-year[9]. - The group has reported a significant increase in offline customer traffic and consumption market recovery, driven by the government's optimization of pandemic control measures[14]. - The company anticipates future economic growth, projecting an increase in stock value that will provide stable returns to shareholders[73]. Business Strategy and Development - The group plans to leverage its management team's extensive experience in the sports apparel industry and strong financial resources to seek opportunities for operating more international brands in China and/or regional markets[5]. - The group is committed to optimizing its business system and accelerating digital transformation to improve efficiency and business performance[14]. - The group aims to provide long-term stable returns to shareholders through prudent project investment and timely exits from existing projects[3]. - The group aims to enhance brand competitiveness through innovative design and functional products, targeting the growing sportswear market in China[21]. - The group plans to continue expanding its market presence and product offerings, including collaborations with trendy brands like FR2[1]. Product Innovation and Marketing - The group continues to enhance its product development efforts, focusing on innovation in design, materials, and functionality to strengthen market competitiveness[14]. - The Kappa brand has engaged in multiple collaborations with youth idols and virtual influencers, enhancing brand visibility and engagement among younger consumers[14]. - The Kappa brand's promotional strategy emphasizes its core values of "passion, sexiness, and avant-garde," with various innovative and interactive marketing activities[14]. - The group has successfully launched new products under the phenix brand, including a collaboration with the Japanese streetwear brand FR2, showcasing a blend of retro elements and high-end technology[2]. - The group has launched the Kappa 1916 series to connect with younger consumers, emphasizing the brand's pioneering spirit and retro style[1]. Financial Performance - The group's operating profit for the reporting period was RMB 138 million, compared to an operating loss of RMB 1,786 million in the previous period, resulting in an operating profit margin of 8.2%[38]. - The group's sales cost for the reporting period was RMB 652 million, a decrease of RMB 39 million compared to RMB 691 million in the previous period[33]. - The total distribution and administrative expenses amounted to RMB 1,137 million, representing 67.7% of total sales, a reduction of 4.1 percentage points from the previous period[36]. - The group's advertising and sales expenses were RMB 788 million, a decrease of RMB 130 million from RMB 918 million in the previous period, mainly due to lower sales[58]. - The group's financial income net amount was RMB 40 million, compared to a net financial expense of RMB 14 million in the previous period[60]. Corporate Governance - The company adheres to the Hong Kong Stock Exchange listing rules, ensuring transparent communication with shareholders regarding business strategies and investment plans[75]. - The company emphasizes the protection of minority shareholders' rights and interests in its governance practices[75]. - The board of directors includes independent non-executive members, ensuring diverse perspectives in decision-making[85]. - The company has implemented a policy for the appointment of external auditors, ensuring their independence and the effectiveness of audit procedures[139]. - The company has established various committees, including the Audit Committee, Remuneration Committee, Nomination Committee, Executive Committee, and Environmental, Social, and Governance Committee, to oversee specific areas of the company's affairs[154]. Environmental, Social, and Governance (ESG) Commitment - The group is committed to sustainable development by establishing an Environmental, Social, and Governance (ESG) committee to oversee its policies[26]. - The company has maintained a commitment to environmental, social, and governance (ESG) reporting guidelines[95]. - The environmental, social, and governance (ESG) committee held two meetings in the past twelve months to review the company's ESG policies and performance[198]. - The company has complied with the environmental, social, and governance reporting guidelines as per the listing rules, with relevant disclosures made in its reports[144]. Workforce and Diversity - The group has reduced its workforce to 471 employees as of March 31, 2023, down from 627 employees a year earlier[28]. - The employee gender ratio is approximately 67.1% female and 32.9% male, reflecting the company's commitment to diversity[194]. - The board consists of 8 members, including 1 female and 6 males, with 3 independent directors and 4 executive directors[193]. - The company will continue to implement measures to promote diversity at all levels of the workforce[194]. - The nomination committee has reviewed the board's composition and is satisfied with its diversity in terms of independence, skills, industry experience, gender, age, and tenure[192].
中国动向(03818) - 2023 - 年度业绩