Financial Performance - For the fiscal year ending March 31, 2020, the group recorded a revenue of HKD 2.937 billion, a decrease of 26.7% compared to the previous year[10] - Net profit attributable to equity shareholders was HKD 645.8 million, an increase of 57% from HKD 413.1 million in 2019[10] - Same-store sales decreased by 19.5% during the same period[60] - The investment portfolio generated a profit of HKD 855.3 million, significantly contributing to the overall profit increase[60] - Sales in Hong Kong accounted for 81.6% of total revenue, while Taiwan contributed 15.6%[62] - The group reported a net cash inflow from operating activities of HKD 870.6 million for the year, compared to HKD 778.6 million in the previous year[88] - The total employee cost, including directors' remuneration, was HKD 416.8 million, down from HKD 454.5 million in the previous year[87] - The group’s cash and bank deposits increased to HKD 3.32 billion, up from HKD 1.73 billion in the previous year[89] - The net financial resources of the group amounted to HKD 2.26 billion, compared to HKD 1.73 billion in the previous year[89] - The group’s investment activities generated a net cash surplus of HKD 205.7 million, compared to a net cash outflow of HKD 44.7 million in the previous year[88] Retail Operations - The group's retail sales in Hong Kong decreased by 24.9%, contributing 81.6% to total sales, while Taiwan contributed 15.6%[14] - The group operates a total of 61 retail stores, including 8 in Hong Kong, 29 in mainland China, and 24 in Taiwan[14] - The company anticipates a prolonged recovery in the retail market due to the severe impact of the COVID-19 pandemic on local consumer sentiment[64] - The unemployment rate in Hong Kong surged to 5.2%, the highest in over a decade, reflecting the economic challenges posed by the pandemic[19] - The company emphasizes that the path to recovery to pre-pandemic levels will be slow and challenging, marking one of the toughest market conditions in its history[19] Dividends and Shareholder Matters - The proposed final dividend is HKD 0.27 per share, with a total dividend yield of 14.4% based on the closing price of HKD 3.81 on March 31, 2020[11] - The board recommends the distribution of a final dividend and a special dividend for the year ending March 31, 2020[32] - The company seeks approval for the issuance of additional shares, not exceeding 20% of the issued share capital as of the date of the resolution[35] - The company seeks approval for the repurchase of shares, not exceeding 10% of the issued share capital as of the date of the resolution[40] - The company will suspend share transfer registration from July 29, 2020, to August 3, 2020, for shareholders to attend the meeting[48] - The company will also suspend share transfer registration from August 10, 2020, to August 11, 2020, for shareholders to qualify for the proposed dividends[48] Corporate Governance - The company has adopted a policy for shareholder communication to enhance relationships with shareholders[169] - The board has a responsibility to prepare consolidated financial statements that fairly reflect the financial position of the group[170] - The company has implemented risk management and internal control systems to monitor business unit performance[160] - The independent auditor, KPMG, is willing to accept reappointment at the upcoming annual general meeting[149] - The board of directors held four regular meetings and one annual general meeting during the fiscal year ending March 31, 2020[159] - The company has three independent non-executive directors, all of whom have confirmed their independence as of March 31, 2020[172] - The chairman and CEO roles are separated to ensure clear distinction in responsibilities, with the current CEO being the group executive chairman[171] - The board reviews corporate governance policies to ensure compliance with legal and regulatory requirements[169] Risk Management - The company maintained an effective risk management and internal control system to protect shareholder investments and group assets[197] - The company has adopted a standard code of conduct for relevant employees regarding securities trading, ensuring compliance with confidentiality regulations[199] - The internal control system and risk management functions are deemed effective and appropriate by the board, in compliance with corporate governance codes[199] Employee and Management Matters - The group employed 924 staff members, a decrease from 1,384 in the previous year[87] - The remuneration policy aims to align the compensation of executive directors and senior management with their performance and the company's objectives[179] - The remuneration committee held one meeting during the year ending March 31, 2020, with all members attending[176] - The nomination committee also held one meeting during the year ending March 31, 2020, with full attendance from its members[181] - The nomination committee reviewed the board's diversity policy, considering factors such as gender, age, cultural background, and professional experience[185] Related Party Transactions - Independent non-executive directors confirmed that the ongoing related party transactions were conducted in the ordinary course of business and on normal commercial terms[140] - The independent auditor confirmed that there were no findings suggesting that the ongoing related party transactions were not approved by the board[143] - The company’s transactions with the S.T. Dupont Group include sales and procurement of goods, management services, and product distribution, conducted under normal commercial terms[116] Agreements and Contracts - The Group entered a three-year procurement agreement with Dunhill Group for purchasing products, with a maximum annual payment of HKD 11.376 million for the fiscal years ending March 31, 2020, and March 31, 2021[118] - The Group provided management and support services to Dunhill Group under a three-year agreement, with a maximum annual service fee of HKD 7.2 million for the fiscal years ending March 31, 2020, and March 31, 2021[119] - The Group offered interior design services to Dunhill Group, with a maximum annual service fee of HKD 1.2 million for the fiscal years ending March 31, 2020, and March 31, 2021[120] - The Group has a licensing agreement for using multiple Dunhill trademarks, with a maximum annual fee of HKD 5 million, which was revised to HKD 1.7 million for the fiscal year ending March 31, 2020[122]
迪生创建(00113) - 2020 - 年度财报