Business Operations - For the six months ended June 30, 2020, the Group operated and managed a total of 48 stores across 21 cities, with a total gross floor area of approximately 3.04 million sq.m., of which 78.99% was attributable to self-owned properties[15]. - The Group has strengthened its leading position in Southern China and expanded into rapidly growing markets in Eastern, Southwestern, and Northern China[15]. - The Group is actively transforming from traditional department store retail to new retail by integrating online and offline advantages to enhance consumer experiences[15]. - As of June 30, 2020, the Group owned 48 stores, including 15 shopping centers, 30 department stores, and 3 outlets[31]. - The number of new members for the "Mao Yue Hui" membership management system reached 500,000 in the first half of 2020, achieving a conversion rate of over 29%[35]. - The "Mao Le Hui" online beauty platform added over 20 exclusive online product brands, resulting in a 240% year-on-year increase in registered members[35]. - The integration of online and offline channels led to cross referrals and cross sales, promoting diversified business development[29]. Financial Performance - The financial highlights for the six months ended June 30, 2020, compared to the same period in 2019, are summarized in the interim report[18]. - For the six months ended June 30, 2020, the Group recorded total operating revenue of RMB 3,703.5 million, a decrease of 4.8% year-on-year[24]. - The Group's net profit for the same period was RMB 127.3 million, representing a significant decline of 69.8% compared to the previous year[24]. - Revenue for the reporting period was RMB 3,703.5 million, representing a year-on-year decrease of 4.8%[27]. - Net profit recorded was RMB 127.3 million, reflecting a year-on-year decrease of 69.8%[27]. - For the six months ended June 30, 2020, total sales proceeds and rental income were RMB 4,508.2 million, a decrease of 40.9% compared to the same period in 2019[57]. - Total sales proceeds from concessionaire sales accounted for 73.9%, with RMB 3,331.8 million, representing a decrease of 45.7% compared to the same period in 2019[59]. - Rental income was RMB 492.7 million, representing a decrease of 8.9% compared to the same period in 2019[59]. - The Group's total sales proceeds and rental income in Eastern China decreased by 24.2% compared to 2019[63]. - The Group's other income amounted to RMB 517.8 million, a decrease of 32.3% compared to RMB 765.3 million for the same period last year[67]. - The Group recorded an operating profit of RMB 1,055.0 million, a decrease of 22.5% compared to RMB 1,361.7 million in the same period last year, primarily due to the impact of COVID-19 on store traffic and sales[70]. - The Group's total tax charge for the six months ended 30 June 2020 was RMB 199,581,000, a decrease from RMB 328,655,000 for the same period in 2019[199]. Market Conditions - The total retail sales of consumer goods in the PRC amounted to RMB 17,000 billion in the first half of 2020, down by 11.4% year-on-year[21]. - The GDP growth in the PRC decreased by 1.6% year-on-year in the first half of 2020, with a decline of 6.8% in Q1 and a recovery of 3.2% in Q2[21]. - The aggregate retail sales of the top 100 large nationwide retailers in the PRC decreased by 27% year-on-year in the first half of 2020[21]. - The second quarter of 2020 saw a year-on-year decrease of 3.8% in retail sales, significantly narrowed from a 15.2% decline in Q1[21]. - The effective measures in controlling COVID-19 in the PRC raised market confidence and consumption, indicating a recovery trend[21]. Cost Management - The Group implemented measures to reduce manpower costs and improve structure to enhance corporate profitability amid economic decline[38]. - Employee expenses decreased by 33.1% to RMB 200.9 million from RMB 300.4 million in the previous year, mainly due to enhanced human resources management and subcontracting of certain business operations[67]. - Other operating expenses amounted to RMB 441.0 million, down 30.6% from RMB 635.9 million in the same period last year, with the percentage of total sales proceeds and rental income increasing to 9.8%[70]. - The cost of sales for the six months ended June 30, 2020, was RMB 1,553.6 million, representing an increase of 32.3% from RMB 1,174.5 million year-on-year[67]. Cash Flow and Liquidity - As of June 30, 2020, the Group's cash and cash equivalents amounted to RMB 1,054.9 million, a decrease of RMB 177.7 million from RMB 1,232.6 million as of 31 December 2019[72]. - The Group recorded a net cash inflow of RMB 48.1 million from operating activities for the first half of 2020[72]. - Net cash outflow from financing activities was RMB 422.2 million, primarily due to repayment of bank loans and other borrowings totaling RMB 5,781.0 million[72]. - The Group had a net cash inflow of approximately RMB 1,366.2 million from borrowings from fellow subsidiaries[72]. - As of June 30, 2020, the Group had net current liabilities of approximately RMB 9,672,226,000, indicating a significant liquidity challenge[161]. - The directors assessed the Group's liquidity position, considering estimated operating cash inflows for the next twelve months and the ability to renew bank loans[161]. Shareholder Information - As of June 30, 2020, Mrs. Huang Jingzhang held 4,250,000,000 ordinary shares, representing approximately 82.68% of the Company's issued share capital[97]. - Maoye Department Store Investment Limited, a wholly-owned subsidiary, held 4,200,000,000 ordinary shares, accounting for about 81.71% of the Company's issued share capital[97]. - The Board does not recommend declaring an interim dividend for the six months ended 30 June 2020[75]. - The Group did not propose an interim dividend for the six months ended 30 June 2020, while a final dividend of HK1.98 cents per ordinary share was paid in July 2020[200]. Corporate Governance - The Company confirmed compliance with the Model Code for securities transactions by all directors during the six months ended June 30, 2020[106]. - There were no incidents of non-compliance with the Employees Written Guidelines during the same period[107]. - The company has complied with the Corporate Governance Code provisions during the six months ended June 30, 2020, except for the deviation regarding the roles of Mr. Huang Mao Ru as both Chairman and CEO[113]. - The Audit Committee reviewed the unaudited interim results for the six months ended June 30, 2020, discussing accounting principles, risk management, and internal control systems with management[113].
茂业国际(00848) - 2020 - 中期财报