利亚零售(00831) - 2021 - 中期财报

Performance Highlights The company's continuing operations saw revenue grow 12.7% to HKD 607 million and core operating profit increase 120.4%, though total profit attributable to shareholders declined 72.1% due to the prior period's divested business Financial Summary The company's continuing operations saw revenue grow 12.7% to HKD 607 million and core operating profit increase 120.4%, though total profit attributable to shareholders declined 72.1% due to the prior period's divested business Key Financial Indicators for H1 2021 | Indicator | H1 2021 (Thousand HKD) | H1 2020 (Thousand HKD, Restated) | Change | | :--- | :--- | :--- | :--- | | Revenue | 606,945 | 538,595 | +12.7% | | Core Operating Profit | 20,251 | 9,190 | +120.4% | | Profit Attributable to Company Shareholders (Continuing Operations) | 16,941 | 6,474 | +161.7% | | Profit Attributable to Company Shareholders (Including Discontinued Operations) | 22,912 | 82,051 | -72.1% | | Basic Earnings Per Share (Continuing Operations, HK cents) | 2.2 | 0.8 | +175.0% | | Interim Dividend Per Share (HK cents) | 2.0 | 6.0 | -66.7% | Operational Highlights The company's businesses performed well amid economic recovery, with Saint Honore achieving double-digit sales growth and Mon cher expanding, supported by a strong financial position and a strategic focus on Greater Bay Area brand development - Saint Honore Cake Shop achieved double-digit sales growth due to eased pandemic measures, with robust growth in corporate client sales[36] - The Group maintains a robust financial position with HKD 251 million in net cash and no bank borrowings[36] - Future strategic focus is to accelerate the development of Saint Honore, Mon cher, and Zoff brands in the Greater Bay Area[36] Number of Stores as of June 30, 2021 | Brand | Region | Count | | :--- | :--- | :--- | | Saint Honore Cake Shop | Hong Kong | 86 | | | Macau | 9 | | | Guangzhou | 26 | | | Subtotal | 121 | | Mon cher Cake Shop | Hong Kong | 4 | | Zoff Eyewear | Hong Kong | 11 | | Total Group Stores | | 136 | Chairman's Statement Chairman Fung Kwok Lun noted the Group's successful repositioning as a premium brand retailer in the Greater Bay Area after divesting its convenience store business, achieving significant growth in existing operations amid market recovery - Following the divestment of OK Convenience Store, the Group repositioned as a premium specialized brand retailer in the Greater Bay Area, focusing on brands like Saint Honore, Mon cher, and Zoff[39][41] - Benefiting from the recovery of the local retail market, the Group's existing businesses achieved considerable growth in sales and operating profit[40][43] - Future plans include expanding the brand portfolio and geographical coverage in the Greater Bay Area through licensing, franchising, joint ventures, and acquisitions[44] CEO's Report The CEO's report details the strong performance of Saint Honore Cake Shop, the rapid expansion of Mon cher, and Zoff's continued market leadership, alongside the Group's cautious optimism for future growth and strategic expansion plans Business Review - Saint Honore Cake Shop Saint Honore Cake Shop achieved strong double-digit sales growth and high single-digit same-store sales, driven by rebounding traffic, a robust O2O platform with over 860,000 members, and expanded B2B agreements - Despite a slight reduction in store count from 98 to 95 (Hong Kong and Macau), sales achieved double-digit growth, and same-store sales recorded high single-digit growth[47] - The "Saint Honore Cake Online" O2O platform has over 860,000 members, effectively driving online orders and offline foot traffic[50] - Actively expanded B2B business, signing an agreement with a major Hong Kong supermarket chain to become its strategic system supplier for bakery products[51] Business Review - Mon cher Mon cher, the Group's premium Japanese cake brand, rapidly expanded in Hong Kong, adding three new stores in prime locations for a total of four, showing strong market performance - The Group obtained the franchise rights for Japanese premium cake shop Mon cher in Hong Kong and Macau in 2020, renowned for its signature "Dôjima Roll"[53] - In the first half of 2021, three new stores were added in prime locations: Langham Place (Mong Kok), Harbour City (Tsim Sha Tsui), and New Town Plaza (Sha Tin), bringing the total to four stores[53] Business Review - Zoff Japanese fast-fashion eyewear brand Zoff maintained its leadership in Hong Kong with 11 branches, seeing sales rebound due to eased restrictions and product innovation - Zoff operates 11 branches in Hong Kong, maintaining its leading position among fast-fashion eyewear brands[54] - Continuously updates products to attract customers by launching "Made in Japan" series, collaborations with "Wind & Sea," and "Disney Happiness" collections[55] Outlook The Group holds cautious optimism for moderate growth, planning further Saint Honore expansion in Hong Kong and Greater Bay Area franchising, accelerating Mon cher's growth, and exploring Zoff's entry into mainland China - Expected to record moderate growth in the second half and full year, partly due to the low base in the prior year's first half[57] - Plans to open new Saint Honore branches in Hong Kong and grant franchise rights in the Greater Bay Area market beyond Guangzhou[57] - Discussions are underway with Zoff Japan to expand the brand into the mainland China market[57] Discussion and Analysis This section provides a detailed financial review, highlighting revenue growth in continuing operations, changes in gross margin, and the Group's healthy financial position, along with an overview of employee statistics and related costs Financial Review Revenue from continuing operations grew 12.7% to HKD 607 million, driven by the cake shop business, while gross margin declined due to lower-margin corporate sales, yet core operating profit increased 171.8% to HKD 17 million, supported by a strong net cash position - Revenue from continuing operations increased by 12.7%, with the cake shop business growing by 14.0% and Zoff eyewear business by 2.0%[60] - Gross margin decreased by 2.5 percentage points to 49.7%, primarily due to an increased proportion of lower-margin corporate client sales[60] - Profit from continuing operations increased by 161.7% to HKD 17 million[61] - As of June 30, 2021, the Group held net cash balances of HKD 251 million with no bank borrowings[61] - The Board resolved to declare an interim dividend of 2 HK cents per share, compared to 6 HK cents in the prior period[62] Employees As of June 30, 2021, the Group employed 3,019 individuals, with total staff costs of HKD 234 million for the first half, significantly reduced due to the convenience store divestment Employee Statistics | Item | Data | | :--- | :--- | | Total Employees (2021/6/30) | 3,019 persons | | Hong Kong Employees | 1,465 persons (49%) | | Guangzhou, Shenzhen, Macau Employees | 1,554 persons (51%) | | Total Staff Costs (2021 H1) | HKD 234 million | | Total Staff Costs (2020 H1) | HKD 474 million | Corporate Governance The company adhered to the HKEX Corporate Governance Code, ensuring transparency, accountability, and independence through a well-structured Board, distinct Chairman and CEO roles, and specialized committees with independent non-executive director majorities Board Committees The Board established Audit, Remuneration, and Nomination Committees, each with clear terms of reference and predominantly led by independent non-executive directors to ensure independent oversight of key governance areas - The Board established an Audit Committee, a Nomination Committee, and a Remuneration Committee, each with clearly defined terms of reference[71] - The Audit Committee and Remuneration Committee are chaired by independent non-executive directors, while the Nomination Committee is chaired by the non-executive Chairman, ensuring independent operation of the committees[71] Risk Management and Internal Control The Board, with Audit Committee assistance, is ultimately responsible for the Group's risk management and internal control systems, which were deemed adequate and effective for the six months ended June 30, 2021 - The Board and Audit Committee concluded that the Group's risk management and internal control systems were adequate and effectively operated during the reporting period[79] Other Information This section details directors' and major shareholders' interests, including Dr. Fung Kwok Lun's family (40.17%), Standard Life Aberdeen plc (11.98%), and FIL Limited (9.17%), alongside information on share option schemes and the declared interim dividend of 2 HK cents per share Directors' and Shareholders' Interests As of June 30, 2021, Dr. Fung Kwok Lun and Ms. Fung Wing Yee collectively held approximately 40.17% of shares, with Standard Life Aberdeen plc (11.98%) and FIL Limited (9.17%) as other major shareholders Major Shareholders' Interests (as of June 30, 2021) | Shareholder Name | Number of Shares | Percentage of Interest (Approximate) | | :--- | :--- | :--- | | HSBC Trustee (C.I.) Limited (as trustee of the Fung Family Trust) | 311,792,000 | 40.17% | | King Lun Holdings Limited | 311,792,000 | 40.17% | | Standard Life Aberdeen plc's investment management entities | 93,020,000 | 11.98% | | FIL Limited | 71,204,000 | 9.17% | Interim Dividend The Board declared an interim dividend of 2 HK cents per share for the six months ended June 30, 2021, a decrease from 6 HK cents in the prior period - The Board resolved to declare an interim dividend of 2 HK cents per share (H1 2020: 6 HK cents)[97] Condensed Consolidated Interim Financial Statements This section presents the condensed consolidated interim financial statements, including the statement of profit or loss, statement of financial position, statement of cash flows, and detailed notes, providing a comprehensive overview of the Group's financial performance and position Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2021, revenue from continuing operations was HKD 607 million, with total profit attributable to shareholders, including discontinued operations, at HKD 22.91 million Profit or Loss Statement Summary (For the six months ended June 30, 2021) | Item (Thousand HKD) | 2021 (Unaudited) | 2020 (Restated) | | :--- | :--- | :--- | | Continuing Operations | | | | Revenue | 606,945 | 538,595 | | Core Operating Profit | 20,251 | 9,190 | | Profit for the Period | 16,941 | 6,474 | | Discontinued Operations | | | | Profit for the Period | 5,971 | 75,577 | | Profit Attributable to Company Shareholders | 22,912 | 82,051 | Condensed Consolidated Statement of Financial Position As of June 30, 2021, the Group reported total assets of HKD 1.219 billion, total liabilities of HKD 617 million, and total equity of HKD 602 million, with HKD 251 million in cash and cash equivalents Statement of Financial Position Summary (As of June 30, 2021) | Item (Thousand HKD) | June 30, 2021 (Unaudited) | December 31, 2020 (Audited) | | :--- | :--- | :--- | | Total Assets | 1,219,231 | 1,344,166 | | Non-current Assets | 825,907 | 842,727 | | Current Assets | 393,324 | 501,439 | | Total Liabilities | 617,124 | 765,312 | | Non-current Liabilities | 98,574 | 107,825 | | Current Liabilities | 518,550 | 657,487 | | Total Equity | 602,107 | 578,854 | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2021, net cash from operating activities was HKD 33.21 million, while investing and financing activities resulted in net outflows, leading to a HKD 123 million decrease in cash and cash equivalents, ending at HKD 251 million Cash Flow Statement Summary (For the six months ended June 30, 2021) | Item (Thousand HKD) | 2021 (Unaudited) | 2020 (Restated) | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 33,214 | 98,104 | | Net Cash (Used in)/Generated from Investing Activities | (88,337) | 224,718 | | Net Cash Used in Financing Activities | (67,698) | (378,146) | | Decrease in Cash and Cash Equivalents | (122,821) | (55,324) | | Cash and Cash Equivalents at Beginning of Period | 373,143 | 642,639 | | Cash and Cash Equivalents at End of Period | 250,522 | 412,993 | Notes to the Condensed Consolidated Interim Financial Information The notes to the financial statements provide detailed explanations for various items, including accounting policies, segment information, and discontinued operations, highlighting the cake shop business as the Group's primary revenue and profit source - Note 19 details the discontinued operations (OK Convenience Store), whose sale was completed on December 21, 2020, with the HKD 5.97 million profit recorded in H1 2021 representing a net reversal of provisions for the sale[166] Segment Core Operating Profit (H1 2021, Thousand HKD) | Business Segment | Region | Core Operating Profit | | :--- | :--- | :--- | | Cake Shop Business | Hong Kong and Other | 17,933 | | | Mainland China | (851) | | Eyewear Business | Hong Kong | 3,169 | | Group Total | | 20,251 |