Financial Performance - For the year ended December 31, 2019, the revenue was HKD 1,316,101,000, a decrease of 2.8% compared to HKD 1,353,665,000 in 2018[18] - The gross profit for 2019 was HKD 468,505,000, reflecting a slight increase of 0.6% from HKD 465,788,000 in the previous year[18] - The profit attributable to the company's owners for 2019 was HKD 143,001,000, representing a 6.0% increase from HKD 134,960,000 in 2018[18] - The basic earnings per share increased to HKD 0.19 in 2019, up 5.6% from HKD 0.18 in 2018[18] - The gross margin improved to 35.6% in 2019 from 34.4% in 2018, while the net profit margin increased to 10.9% from 10.0%[18] - The group's consolidated revenue for the fiscal year ended December 31, 2019, was approximately HKD 1,316,101,000, a decrease of about HKD 37,564,000 or 2.8% compared to the previous year[34] - Profit attributable to the company's owners increased by approximately HKD 8,041,000 or 6.0% to about HKD 143,001,000, compared to approximately HKD 134,960,000 in the previous year[30] - The group's gross profit increased by approximately 0.6% to about HKD 468,505,000 due to improved overall production cost control[38] Dividends and Shareholder Returns - The interim dividend paid was HKD 0.055 per share, a 10.0% increase from HKD 0.05 in 2018, while the proposed final dividend was HKD 0.03, a decrease of 40.0% from HKD 0.05 in 2018[18] - The company aims to enhance business growth, diversify operations, and improve productivity to maximize shareholder returns[7] - The group plans to continue seeking better returns for shareholders while optimizing production capacity and reducing labor costs[31] Financial Stability and Ratios - The capital debt ratio significantly decreased to 2.0% in 2019 from 27.0% in 2018, indicating improved financial stability[18] - The current ratio improved to 3.6 in 2019, up 80.0% from 2.0 in 2018, reflecting better liquidity[18] Operations and Workforce - The company operates four factories in Vietnam and employs approximately 7,700 staff across various regions including Hong Kong, Macau, China, and the US[12] - The company reported a decrease in employee numbers from approximately 9,500 to about 7,700 as of December 31, 2019[75] - Employee turnover rates for 2019 were 62.03% for ages 18-25, 27.99% for ages 26-35, 8.3% for ages 36-45, and 1.68% for ages 46-55, compared to 67.7%, 26.1%, 5.5%, and 0.7% respectively in 2018[200] Research and Development - Research and development expenses rose by approximately 11.3% to about HKD 26,676,000, primarily due to increased resources allocated for toy product development[43] Acquisitions and Investments - The group completed the acquisition of 100% equity in Javi Investment Joint Stock Company for a cash consideration of approximately HKD 190,876,000, with the main assets being leased land and land use rights[56] - The company has acquired five land use rights in Da Nang, Vietnam, for property development investment purposes[30] - The group has acquired five land use rights in Da Nang, Vietnam, aiming to develop these plots for property investment, aligning with the overall development strategy to enhance asset and income base[83] - The company is actively seeking and exploring various investment and quality acquisition opportunities to generate additional value, synergies, and new revenue sources[83] Market Performance - Revenue from the original design manufacturing business increased due to continued support from major customers and the launch of popular product lines, despite a slight overall decline in total revenue[61] - Sales in the U.S. market decreased by approximately HKD 94,651,000 or 8.2% to about HKD 1,057,047,000, primarily due to a decline in original equipment manufacturing sales[66] - Canadian revenue increased by approximately HKD 12,962,000 or 22.7% to about HKD 70,047,000, supported by a robust banking system and continued growth in non-commodity export-related industries[68] - Revenue in Europe increased by approximately HKD 13,959,000 or 14.1% to about HKD 113,303,000 this year[69] - Revenue in Mexico rose by approximately HKD 5,039,000 or 97.8% to about HKD 10,190,000 this year[70] - Revenue in Australia and New Zealand increased by approximately HKD 13,251,000 or 53.3% to about HKD 38,107,000 this year[73] - Revenue in South America grew by approximately HKD 5,470,000 or 64.0% to about HKD 14,020,000 this year[74] Environmental Sustainability - The total greenhouse gas emissions for the year 2019 amounted to 17,894.36 tons of CO2 equivalent, a decrease from 19,727.65 tons in 2018, representing a reduction of approximately 9.3%[180] - The annual emission density for 2019 was 0.146 tons of CO2 equivalent per square meter, down from 0.161 tons in 2018, indicating improved efficiency[184] - The company eliminated a total of 12,241 tons of CO2 equivalent emissions through the installation of LED lighting and other energy-saving measures[185] - The company is committed to enhancing energy, water, and material efficiency while adhering to local environmental regulations and international standards[176] - The group's electricity consumption was 31,621,610 kWh, a decrease from 34,093,434 kWh in 2018[192] - Water consumption was 69,941 cubic meters, reduced from 93,123 cubic meters in 2018, with a density of 0.57 cubic meters per square meter[194] - The company implemented measures to reduce waste, including double-sided printing and recycling initiatives, to promote environmental sustainability[191] Corporate Governance - The board of directors consists of six executive directors and four independent non-executive directors, with at least one-third being independent[105] - The company has adopted a corporate governance code in compliance with the Hong Kong Stock Exchange's listing rules[103] - The chairman and CEO roles are separated, with Zheng Rongbin as chairman and Chen Weiqing as CEO[111] - The board held a total of twelve meetings during the year, with attendance from all directors at various levels[112] - Independent non-executive directors have confirmed their independence according to applicable listing rules[107] - The company has established committees to assist the board in fulfilling its responsibilities[104] - All directors are required to retire and seek re-election at least every three years[107] - The company has implemented a code to regulate securities trading by directors, ensuring compliance with the revised listing rules[114] - The board is responsible for strategic development and monitoring business operations to enhance shareholder value[104] - The company is committed to continuously reviewing and improving its governance policies in line with best practices[103] - All directors participated in ongoing professional development to ensure they are updated on their responsibilities and the latest developments in the company's operations and governance[115] - The remuneration committee reviewed the remuneration policies for directors and senior management, ensuring alignment with market practices and performance[118] - The remuneration policy aims to attract and retain a high-quality team critical to the company's success[121] - The nomination committee assessed the board's structure, size, and composition to ensure a diverse range of skills and experiences[124] - The nomination committee confirmed the independence of all independent non-executive directors[127] - The company emphasizes a diverse board composition, considering various factors such as age, expertise, and gender[130] - The remuneration committee's detailed scope of work is available on the company's and Hong Kong Stock Exchange's websites[119] - The nomination committee is responsible for identifying suitable candidates for board positions, ensuring a transparent and fair selection process[129] - The company has implemented a policy to monitor the effectiveness of the board through annual reviews[130] - The remuneration committee's members attended all meetings except one member during the fiscal year[126] Audit and Internal Controls - The Audit Committee reviewed the financial statements for the year ended December 31, 2019, which were audited by Deloitte Touche Tohmatsu[141] - The Audit Committee conducted mid-term and year-end financial reviews, ensuring compliance with accounting policies and relevant standards[139] - The company is committed to maintaining the independence and objectivity of external auditors, with regular discussions on audit issues[139] - The Board is responsible for ensuring the accuracy and timeliness of financial reporting, reflecting the company's operational performance and cash flows[141] - The company has established internal control systems to manage financial, operational, and compliance risks effectively[144] - The Audit Committee evaluated the effectiveness of the internal control systems, including risk management procedures[147] - The Audit Committee members are qualified accountants, ensuring a high level of financial oversight[135] - The internal audit function team was established in 2015 to enhance cost-effectiveness in managing the group's internal audit functions[149] - The internal audit team consists of three members who review and monitor the group's transactions to ensure they are conducted independently[149] - The audit committee has identified key risks and designed an internal audit plan focusing on risk management[151] - The internal audit function provides independent assurance on the adequacy and effectiveness of the group's internal controls[152] - The total fees paid to the auditors for statutory audit services were approximately HKD 2,473,000, with an additional HKD 300,000 for non-audit services[153] Shareholder Communication - The company actively enhances transparency and communication with shareholders through mandatory interim and annual reports[158] - The annual general meeting serves as an effective platform for shareholders to communicate with the board of directors[160] - The company has adopted various policies to assess and improve the effectiveness of its internal controls and risk management functions[151] - The audit committee is responsible for overseeing the whistleblowing policy and ensuring proper investigation of any misconduct[151]
MATRIX HOLDINGS(01005) - 2019 - 年度财报