Financial Performance - The company reported no dividends for the fiscal year ending December 31, 2018[7]. - The company’s performance and financial results for the year are detailed in the consolidated income statement and other comprehensive income statement[6]. - The net loss attributable to shareholders for the year ended December 31, 2018, was HKD 73,097,000, a significant increase from a net loss of HKD 6,505,000 in the previous year[47]. - Total revenue decreased by 11% to HKD 142,110,000 in 2018, down from HKD 159,450,000 in 2017, primarily due to a decline in overall sales volume from reduced points of sale[55]. - The gross profit decreased by 7% to HKD 91,512,000, with a gross margin of 64%, which is an increase of about 3% compared to the previous year[55]. - The company reported positive results in fashion retail, financial management returns, and investment property revaluation, despite losses from long-term equity investments and club operations[46]. - The club business experienced an increase in losses by HKD 5,661,000, attributed to temporary closures for renovations and staff turnover[52]. - The group's financial instrument investments reported a net loss of HKD 44,542,000, compared to a net gain of HKD 24,442,000 in 2017[58]. - The company recorded a one-time income of HKD 1,073,000 from the reclassification of foreign exchange reserve after the liquidation of a subsidiary in China[52]. - The company recorded a net loss of HKD 7,813,000 on corporate bond investments for the year ending December 31, 2018, with a total book value reduced to HKD 19,147,000[95]. Investment Strategy - The company aims to reduce investments in individual listed stocks and corporate bonds while increasing investments in professionally managed unit trusts and fixed income fund portfolios[101]. - The company plans to allocate a portion of investments to a discretionary investment portfolio managed by an investment bank in Hong Kong, while retaining control over the portfolio[101]. - The investment strategy focuses on capitalizing on growth opportunities in small and medium-sized enterprises benefiting from expanding trade and investment between ASEAN member states and China[99]. - The company expresses confidence in the performance and prospects of its private equity investments, managed by a seasoned manager[98]. - The company has increased its investment in mainly unit stocks and fixed-income funds, establishing a discretionary investment portfolio managed by professional asset managers[123]. Market Conditions - The global economic outlook deteriorated during the reporting year, impacting financial markets, particularly in the second half[46]. - The investment market is expected to remain volatile in 2019, with anticipated global economic growth and corporate earnings slowing down due to uncertainties like the US-China trade conflict and Brexit[147]. - The company faces challenges in the retail fashion market due to limited suitable locations and high rental costs in major shopping centers[116]. - The luxury fashion retail market in Hong Kong continued to grow, although the performance in the second half was weaker than in the first half[46]. Corporate Governance - The company has adopted a corporate governance manual to enhance transparency and shareholder value[171]. - The board consists of seven directors, including two executive directors and four independent non-executive directors, ensuring compliance with listing rules[172]. - The company has maintained compliance with all corporate governance codes as per the listing rules for the year ending December 31, 2018[171]. - The board has adopted a diversity policy to enhance performance, considering factors such as gender, age, cultural background, and professional experience[185]. - The company has established five board committees: Audit, Corporate Governance, Investment, Nomination, and Remuneration, each with clear responsibilities and resources[199]. Employee Management - The company is committed to retaining employees through training and attractive performance indicators to address the competitive labor market[117]. - The total employee cost was approximately HKD 53,349,000, a decrease of 9.3% from HKD 59,005,000 in 2017[142]. - The group had 134 employees as of December 31, 2018, down from 158 employees a year earlier, indicating a reduction of 15.2%[142]. Risk Management - The company faced significant risks and uncertainties, which are discussed in the CEO's report[5]. - The company has implemented comprehensive information security measures, including new-generation firewalls and regular data backups, to mitigate cyber risks[126]. - The company has adopted a prudent strategy for cash management and foreign exchange risk, including the use of forward foreign exchange contracts[131]. Shareholder Information - The company has no reserves available for distribution to shareholders as of December 31, 2018[15]. - The company confirmed that the ongoing related party transactions were conducted on normal commercial terms and were in the best interest of shareholders[38]. - The company has maintained the public float as required by the listing rules[43]. Leasing and Operational Costs - The company entered into a lease agreement (Lease Agreement II) for office space at a monthly rent of HKD 218,778, effective from December 1, 2018, to November 30, 2021[37]. - The actual payment under Lease Agreement II for the year ended December 31, 2018, was HKD 60,179, which did not exceed the annual cap set by the company[37]. - The company is monitoring leasing costs through regular market surveys and rent benchmarking tests to support sales efficiency[120]. Future Plans - The company aims to enhance supply chain efficiency to reduce inventory levels and improve sales rates before discount periods to maintain profit margins[120]. - The company plans to continue diversifying its investment portfolio to balance risk and return amid market volatility caused by factors such as U.S. interest rate hikes and U.S.-China trade tensions[123]. - The company plans to enhance its online sales platform and collaborate with e-retailers to expand sales channels[144].
安宁控股(00128) - 2018 - 年度财报