利亚零售(00831) - 2024 - 中期业绩

Financial and Operational Summary Financial Summary In H1 2024, the Group's revenue saw a slight increase of 2.8% to HKD 722 million, but core operating profit and profit attributable to company shareholders decreased by 19.5% and 16.0% year-on-year, respectively, while the interim dividend per share remained unchanged at HKD 2.0 cents Financial Highlights | Indicator | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue (HKD Thousands) | 721,654 | 701,832 | +2.8% | | Core Operating Profit (HKD Thousands) | 17,419 | 21,632 | -19.5% | | Profit Attributable to Company Shareholders (HKD Thousands) | 12,767 | 15,199 | -16.0% | | Basic Earnings Per Share (HK Cents) | 1.6 | 2.0 | -20.0% | | Interim Dividend Per Share (HK Cents) | 2.0 | 2.0 | N/A | Operational Summary The Group achieved sales growth in a challenging market, primarily driven by seasonal products and B2B bakery business, but net profit declined due to weak performance in Hong Kong's eyewear business and upfront investments in the Singapore market, while maintaining a robust financial position with HKD 176 million in net cash and no bank borrowings, despite a slight decrease in total store count from 176 to 175 - Sales growth was primarily driven by strong performance in seasonal products and the Business-to-Business (B2B) bakery segment[2] - Net profit decline was mainly attributed to the weak performance of the Hong Kong eyewear business and upfront investments in the Singapore region[2] - The Group maintained a robust financial position with HKD 176 million in net cash and no bank borrowings[2] Store Count by Type | Store Type | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total Bakery Business Stores | 154 | 161 | | Saint Honore Cake Shop | 148 | 155 | | Mon cher Cake Shop | 6 | 6 | | Total Zoff Eyewear Stores | 21 | 15 | | Total Convenience Retail Asia Stores | 175 | 176 | Management Discussion and Analysis CEO's Report The CEO noted that the retail market continued to face multiple challenges in the first half, including increased outbound travel by Hong Kong residents, changing consumption habits of mainland tourists, high interest rates, and generally subdued consumer sentiment; despite this, the Group achieved reasonable financial performance through product innovation and prudent cost control, with significant growth in the B2B business due to industry outsourcing trends, and expressed satisfaction with the progress of the new eyewear business in Singapore - The retail market faced multiple challenges, including increased outbound travel by Hong Kong residents, changing shopping habits of mainland Chinese tourists, high interest rates, and generally subdued consumer sentiment, leading to reduced store traffic and average purchase volume[3] - The Group's Business-to-Business (B2B) segment achieved significant growth as industry participants increasingly outsourced non-core bakery products[3] Business Review Business segment performance diverged, with Saint Honore Cake Shop benefiting from strong B2B growth largely offsetting same-store sales decline, Mon cher Cake Shop experiencing weekend sales decline due to outbound travel trends, and Zoff eyewear business facing same-store sales decline in Hong Kong due to low-price competition from mainland, while successfully narrowing losses in the newly acquired Singapore market through effective operations Saint Honore Cake Shop Despite a decline in same-store sales due to weak consumption and increased outbound travel by Hong Kong residents, Saint Honore Cake Shop's overall revenue remained flat year-on-year, primarily driven by strong double-digit growth in its Business-to-Business (B2B) segment, with the Group responding to rising costs and market challenges by streamlining workflows, optimizing its store network, and enhancing online marketing through its O2O platform with over 1.3 million members - The Business-to-Business (B2B) segment developed rapidly, achieving strong double-digit growth that offset the decline in same-store sales caused by reduced consumer spending and increased outbound travel[4] - The O2O customer relationship management platform 'Saint Honore Cake Online' has over 1.3 million members in Hong Kong and Macau, serving as a crucial marketing tool and receiving awards from the Hong Kong Retail Management Association[5] - To address labor shortages and rising costs, the Group implemented measures such as streamlining workflows, adjusting operating hours, and increasing flexible staff[4] - Guangzhou operations continued to be affected by the challenging retail environment, with the Group currently controlling losses through prudent cost management and store network adjustments[5] Mon cher Japanese cake brand Mon cher launched its first Lunar New Year gift boxes in the first half to positive reception; however, weekend sales declined due to outbound travel trends and reduced local consumer appetite for non-essential items like premium cakes, with the Group planning to open a new store in Central in early 2025 - Weekend sales declined due to outbound travel trends and reduced local consumer appetite for premium cakes and similar products[6] Zoff Hong Kong's Zoff business experienced a decline in same-store sales due to significantly lower pricing from Greater Bay Area competitors and a strong Hong Kong dollar encouraging local residents to spend in mainland China; in Singapore, the Group acquired local operations in January and successfully narrowed losses by streamlining operations, adjusting pricing strategies, and enhancing social media promotion, despite facing customer traffic challenges - Same-store sales in Hong Kong decreased due to significantly lower pricing from Greater Bay Area competitors and a strong Hong Kong dollar, which encouraged local residents to spend in mainland China[7] - The Group entered the Southeast Asian market for the first time in January this year by acquiring Zoff Singapore operations, successfully narrowing losses through measures such as streamlining store operations and adjusting pricing strategies[7] Future Outlook The Group anticipates continued retail market challenges in the second half, focusing on expanding its product portfolio (especially frozen products), vigorously developing the high-potential B2B business, and investing in digitalization and automation of production facilities to counter rising labor costs, while adopting a cautious approach to store network expansion and continuing to seek expansion opportunities through M&A and joint ventures - Strategic priorities include expanding the product portfolio, leveraging the competitive advantages of frozen product categories, and anticipating steady development of the B2B business in the second half[8] - To support bakery business growth and address labor market challenges, the Group is increasing investments to upgrade production facilities, heavily investing in digitalization, smart, and semi-automated manufacturing[8] - The Group will continue to seek expansion opportunities through mergers and acquisitions, joint ventures, licensing, and franchising to expand its specialized retail portfolio[8] Financial Review In H1 2024, turnover increased by 2.8% year-on-year to HKD 722 million, primarily driven by B2B growth in the bakery business; gross profit margin rose by 1.6 percentage points to 53.7% due to effective pricing and cost control, but operating expenses as a percentage of turnover increased from 49.7% to 51.7% due to rising labor costs, leading to a 19.5% decrease in core operating profit, while the Group maintained a robust financial position with HKD 176 million in net cash and no bank borrowings Financial Indicators | Financial Indicator | 2024 H1 | 2023 H1 | | :--- | :--- | :--- | | Turnover (HKD Million) | 722 | 702 | | Gross Profit Margin | 53.7% | 52.1% | | Operating Expenses as % of Turnover | 51.7% | 49.7% | | Core Operating Profit (HKD Million) | 17 | 21.6 | | Net Profit (HKD Million) | 13 | 15 | - Gross profit margin increased by 1.6 percentage points, benefiting from effective pricing strategies, efficient category management, improved production efficiency, and favorable RMB and JPY exchange rates[9] - Operating expenses as a percentage of turnover increased, primarily due to rising staff-related costs driven by a tight labor market[9] Employees As of June 30, 2024, the Group had a total of 3,150 employees, with 49% based in Hong Kong; total staff costs for the first half increased to HKD 257 million from HKD 239 million in the same period last year, as the Group is committed to offering competitive compensation and development opportunities to address challenges posed by low unemployment and labor shortages Employee Statistics | Item | Data | | :--- | :--- | | Total Employees (June 30, 2024) | 3,150 | | Proportion of Hong Kong Employees | 49% | | Proportion of Part-time Employees | 23% | | Total Staff Costs (2024 H1) (HKD Million) | 257 | | Total Staff Costs (2023 H1) (HKD Million) | 239 | Condensed Consolidated Financial Statements and Notes Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2024, the Group recorded revenue of HKD 722 million, a 2.8% year-on-year increase; however, due to increased expenses, core operating profit decreased to HKD 17.42 million, and profit attributable to company shareholders was HKD 12.77 million, a 16.0% decrease from HKD 15.20 million in the same period last year, with basic earnings per share at HKD 1.6 cents Condensed Consolidated Statement of Profit or Loss | Item (HKD Thousands) | 2024 H1 (Unaudited) | 2023 H1 (Unaudited) | | :--- | :--- | :--- | | Revenue | 721,654 | 701,832 | | Gross Profit | 387,227 | 365,867 | | Core Operating Profit | 17,419 | 21,632 | | Profit Before Income Tax | 16,747 | 20,280 | | Profit Attributable to Company Shareholders | 12,767 | 15,199 | Condensed Consolidated Statement of Financial Position As of June 30, 2024, the Group's total assets were HKD 1.227 billion, a decrease from HKD 1.286 billion at the end of 2023; total equity was HKD 642 million, total liabilities were HKD 585 million, and cash and cash equivalents decreased from HKD 221 million to HKD 174 million Condensed Consolidated Statement of Financial Position | Item (HKD Thousands) | June 30, 2024 (Unaudited) | December 31, 2023 (Audited) | | :--- | :--- | :--- | | Total Assets | 1,226,834 | 1,286,088 | | Total Equity | 641,915 | 660,190 | | Total Liabilities | 584,919 | 625,898 | | Cash and Cash Equivalents | 174,437 | 220,640 | Notes to Financial Information The notes detail key items such as the basis of financial statement preparation, accounting policies, segment information, taxation, dividends, and receivables/payables; segment data indicates that the bakery business remains the primary revenue source but incurred losses in mainland China, while the eyewear business also recorded overall operating losses due to challenges in the Hong Kong market and initial investments in Singapore Revenue and Segment Information Total revenue for H1 2024 was HKD 722 million, with bakery sales contributing HKD 649 million and eyewear sales HKD 73 million; by segment performance, Hong Kong and other regions' bakery business contributed the majority of core operating profit (HKD 24.96 million), while mainland China bakery business and eyewear business recorded losses of HKD 3.59 million and HKD 3.95 million, respectively Revenue by Source | Revenue Source (HKD Thousands) | 2024 H1 | 2023 H1 | | :--- | :--- | :--- | | Bakery Sales Revenue | 648,658 | 629,093 | | Eyewear Sales Revenue | 72,996 | 72,739 | | Total | 721,654 | 701,832 | 2024 H1 Core Operating Profit/(Loss) by Segment | Segment (HKD Thousands) | Amount | | :--- | :--- | | Bakery Business (Hong Kong and Other) | 24,964 | | Bakery Business (Mainland China) | (3,594) | | Eyewear Business (Hong Kong and Other) | (3,951) | | Group Total | 17,419 | Dividends The Board recommended an interim dividend of HKD 2 cents per share for the six months ended June 30, 2024, totaling approximately HKD 15.55 million, consistent with the same period last year - The Board recommended an interim dividend of HKD 2 cents per share for the six months ended June 30, 2024 (2023: HKD 2 cents)[30] Corporate Governance and Other Information Corporate Governance The company fully complied with the Corporate Governance Code under the Hong Kong Stock Exchange Listing Rules during the reporting period; the Board has three committees—Audit, Nomination, and Remuneration—all primarily composed of independent non-executive directors, and the Board, with the assistance of the Audit Committee, reviewed the risk management and internal control systems, deeming them adequate and effective during the period - The company fully complied with the code provisions of the Corporate Governance Code for the six months ended June 30, 2024[33] - The Board and Audit Committee considered the Group's risk management and internal control systems to be adequate and effective during the review period[37] - The Audit Committee reviewed the unaudited interim financial information for the six months ended June 30, 2024, with senior management[35] Dividends and Share-Related Matters The Board resolved to declare an interim dividend of HKD 2 cents per share, consistent with the same period last year, and announced the relevant book closure dates for share transfer registration; furthermore, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the reporting period - The Board resolved to declare an interim dividend of HKD 2 cents per share for the six months ended June 30, 2024 (2023: HKD 2 cents)[39] - During the period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[38]