Financial Performance - In 2023, China's toy exports amounted to USD 40.57 billion, down 12.2% year on year, marking eight consecutive months of negative growth[13]. - The Group's total revenue decreased by approximately 22.4% from approximately RMB169.4 million in FY2022 to approximately RMB131.4 million in FY2023[22]. - The Group's gross profit decreased from approximately RMB28.3 million in FY2022 to approximately RMB15.0 million in FY2023, representing a decrease of approximately 47.0%[42]. - The gross profit margin decreased by approximately 5.3% from approximately 16.7% in FY2022 to approximately 11.4% in FY2023[42]. - The net loss increased from approximately RMB76.7 million in FY2022 to approximately RMB98.3 million in FY2023, mainly due to increased net impairment losses[43]. - Selling expenses increased by approximately 80.3% from approximately RMB0.9 million in FY2022 to approximately RMB1.6 million in FY2023[44]. - Administrative expenses significantly decreased by approximately 53.9% from approximately RMB76.1 million in FY2022 to approximately RMB35.1 million in FY2023[45]. - The net impairment losses on trade and other receivables increased from approximately RMB24 million in FY2022 to approximately RMB40.7 million in FY2023, representing an increase of approximately 69.6%[51]. - Taxation expenses increased by approximately RMB12.3 million to approximately RMB6.9 million in FY2023, compared to a taxation credit of approximately RMB5.4 million in FY2022[52]. Business Strategy and Market Focus - The Group adjusted its business strategy by outsourcing most production processes, reducing fixed staff costs and machinery maintenance costs, which led to increased production costs and decreased gross profit[13]. - The Group actively explored emerging markets and reduced reliance on long-term customers from European and American markets[13]. - The Group plans to explore the domestic toy retail market and emerging countries around the "Belt and Road Initiative" to stabilize domestic consumption[37]. - The Group will continue to seek collaboration opportunities with well-known brands to enhance product marketability[35]. - The Group aims to enhance core competitiveness through optimization in market expansion, brand building, research and development, and talent attraction[18]. - The Group plans to expand production capacity by outsourcing part of the production process to suppliers and subcontractors, thereby improving production efficiency[106]. - The Group will allocate more resources to expand sales in domestic and emerging Asian markets[106]. - The Group aims to diversify its product offerings through continuous development of new products and a global licensing strategy[106]. Corporate Governance - The Group recognizes the importance of sound corporate governance and is committed to improving accountability and transparency for shareholders[108]. - The Board of Directors is responsible for the overall management and strategic direction of the Group, ensuring appropriate supervision and guidance[113]. - The Group has complied with the Corporate Governance Code, with a noted deviation regarding the roles of chairman and CEO being held by the same individual[109]. - The Board consists of six Directors, including two executive Directors, one non-executive Director, and three independent non-executive Directors[117]. - The Company has achieved gender diversity on the Board with 33.3% female representation, having two female members and four male members as of December 31, 2023[124]. - The Board has adopted a diversity policy to ensure a balanced composition that supports business strategy execution[123]. - The Board meets regularly to determine overall strategies and approve business plans, with special meetings convened as needed[130]. - The Company considers the current gender diversity satisfactory and is committed to further improvement when suitable candidates are identified[127]. Risk Management and Internal Control - The Group has adopted a three-tier risk management approach to identify, assess, and manage different types of risks[180]. - The Group emphasizes the importance of a sound internal control system to mitigate key risk exposures[180]. - The Audit Committee has reviewed the adequacy of resources and qualifications of the accounting and internal audit functions on an annual basis[182]. - The Group's internal control system is designed to provide reasonable assurance against material misstatement or loss[180]. - The Board has reviewed the effectiveness of the risk management and internal control system and considers them generally effective and adequate in all material respects[186]. Shareholder Communication - The company emphasizes communication with shareholders and presents independent resolutions for significant matters at the annual general meeting[197]. - All resolutions proposed at the annual general meeting are subject to voting, with results published on the Hong Kong Stock Exchange website and the company's website[197]. - The next annual general meeting notification will be sent to shareholders at least 21 days prior to the meeting[197]. - Shareholders can convene an extraordinary general meeting (EGM) following the procedures outlined in the Articles and applicable regulations[199].
奇士达(06918) - 2023 - 年度财报