Financial Performance - For the fiscal year ending March 31, 2024, the group's revenue increased by 27.9% to HKD 125,647,000 from HKD 98,212,000 in the previous fiscal year, primarily due to increased watch distribution revenue[6]. - The loss for the fiscal year decreased by 28.9% to HKD 195,842,000, down from HKD 275,579,000 in the previous fiscal year, mainly due to reduced fair value changes of investment properties and impairment losses on property, plant, and equipment[6]. - The earnings per share for the fiscal year was HKD 3.26, compared to HKD 4.54 in the previous fiscal year[6]. - Revenue for the year ending March 31, 2024, increased by 27.9% to HKD 125.6 million from HKD 98.2 million in the previous fiscal year, primarily due to the lifting of pandemic restrictions in mainland China, Hong Kong, and Macau[32]. - The gross loss for the fiscal year 2024 was HKD 19 million, with a gross loss margin of 15.1%, an improvement from the previous year's gross loss of HKD 20.7 million and a margin of 21.1%[32]. - The group's annual loss decreased by HKD 79.7 million or 28.9% to HKD 195.8 million for the year ending March 31, 2024, compared to HKD 275.6 million for the previous year[24]. Revenue Breakdown - Revenue from watch distribution in Hong Kong, mainland China, and Macau accounted for HKD 106,700,000, representing 84.9% of total revenue for the fiscal year[19]. - Revenue from Hong Kong increased by 96.4% to HKD 93,300,000 from HKD 47,500,000 in the previous fiscal year, making up 74.3% of total revenue[20]. - Revenue contribution from mainland China and Macau decreased from 31.2% to 10.7%, with sales dropping 56.4% to HKD 13,400,000 from HKD 30,700,000[21]. - Revenue from other regions (Taiwan and others) decreased by 45.7% to HKD 5,700,000 from HKD 10,600,000 in the previous fiscal year[22]. - Income from property investments in mainland China increased by 39.4% to HKD 13,100,000 due to higher occupancy rates, compared to HKD 9,400,000 in the previous fiscal year[23]. Dividends and Shareholder Returns - The board does not recommend a final dividend for the fiscal year, consistent with the previous fiscal year[6]. - As of March 31, 2024, the company had no distributable reserves available for dividend payments, compared to HKD 106,836,000 in 2023[151]. - The company did not recommend the payment of a final dividend for the year ending March 31, 2024[150]. Operational Metrics - The group operates a distribution network with 57 retail points, down from 61 as of March 31, 2023[14]. - Inventory turnover decreased from 547 days in the previous fiscal year to 112 days in fiscal year 2024, with inventory reduced by 75.0% to HKD 44.5 million[34]. - The current ratio as of March 31, 2024, was 0.4, down from 1.1 a year earlier, primarily due to increased loans and decreased cash and inventory[34]. - Cash and bank balances totaled HKD 29.1 million as of March 31, 2024, compared to HKD 65.5 million a year earlier[37]. Debt and Liabilities - The group's debt-to-equity ratio as of March 31, 2024, was 871.3%, with outstanding loans and borrowings amounting to HKD 242.3 million[37]. - As of March 31, 2024, the group's net current liabilities amounted to HKD 184,800,000, a significant decrease from HKD 14,300,000 as of March 31, 2023[42]. - The group's net asset value decreased to HKD 32,800,000 as of March 31, 2024, compared to HKD 241,400,000 as of March 31, 2023[42]. Corporate Governance - The board consists of six members, including three executive directors and three independent non-executive directors[72]. - The company has adopted the corporate governance code of the Hong Kong Stock Exchange and complied with all code provisions during the year ended March 31, 2024[67]. - The independent non-executive directors ensure that the board handles all matters objectively, safeguarding shareholder interests[70]. - The company has established procedures to accurately handle and disclose inside information, ensuring compliance with corporate governance codes[125]. Management and Strategy - The company is committed to monitoring investment performance and adjusting future investment strategies to mitigate negative impacts on overall returns[42]. - The company aims to expand its sales network in mainland China, Hong Kong, Macau, and Taiwan, while exploring new market opportunities in other Asian countries[28]. - Management is focused on improving profitability and controlling operating costs to enhance operational performance and reduce liquidity risk[117]. - The board believes that the action plan addresses most uncertainties raised by auditors, including obtaining arbitration results and additional financing[117]. Employee and Management Structure - The total number of employees, including directors, was 115 as of March 31, 2024, unchanged from the previous year[47]. - The company continues to review employee compensation to ensure competitiveness and market alignment[48]. - The employee gender ratio as of March 31, 2024, was approximately 43% male and 57% female[94]. - The board currently consists of 6 male directors and 1 female senior management member[95]. Legal and Compliance Issues - The group is facing a potential claim for damages amounting to approximately HKD 619,400,000 related to a distribution agreement[106]. - The company is not aware of any significant issues that would affect its compliance with relevant laws and regulations for the fiscal year ending March 31, 2024[196]. Future Outlook and Plans - The company anticipates generating expected revenue through the sale of Franck Muller watches and accessories, which will allow it to continue executing exclusive distribution agreements[111]. - The company is actively negotiating a loan financing of RMB 500 million with a Chinese bank to support operational funds and business development[116]. - The effectiveness of the going concern basis in the financial statements is contingent upon the successful implementation of the plans and measures outlined, which are subject to significant uncertainties[113].
SINCEREWATCH HK(00444) - 2024 - 年度财报