Financial Performance - For the year ended March 31, 2020, the Group recorded a revenue of HK$1,042,397,000, a decrease of 38.4% compared to HK$1,693,426,000 in 2019[15]. - The cosmetics business generated revenue of HK$836,040,000, down 40.6% from HK$1,408,287,000 in the previous year, accounting for 80.2% of total revenue[16]. - The fashion business revenue was HK$206,357,000, representing a decrease of 27.6% from HK$285,139,000 in 2019[16]. - The Group recorded a loss of HK$258,448,000 for the year, compared to a loss of HK$79,351,000 in 2019, primarily due to a weak retail environment and the impact of COVID-19[17][18]. - The cosmetics business generated revenue of HK$836,040,000, representing a 40.6% decrease from HK$1,408,287,000 in 2019, with a segment loss of HK$173,718,000 compared to a loss of HK$52,884,000 in the previous year[20][24]. - The fashion business revenue was HK$206,357,000, down 27.6% from HK$285,139,000 in 2019, with a segment loss of HK$57,202,000 compared to a loss of HK$29,797,000 in 2019[24][26]. - The overall loss, excluding non-cash provisions, would have been approximately HK$185,097,000 for the financial year, compared to HK$64,409,000 in 2019[18]. Impairment and Provisions - The Group made provisions for impairment totaling approximately HK$61,643,000, including HK$49,516,000 for the cosmetics segment and HK$12,127,000 for the fashion segment[18][20][26]. - The Group's total provisions for the year included HK$36,021,000 in 2019, indicating an increase in financial strain due to the pandemic[18][20]. - The loss for the year included a decrease in fair value of investment properties amounting to HK$11,707,000, compared to an appreciation of HK$21,079,000 in 2019[18]. Liquidity and Financial Position - The Group's cash and bank balances at the end of the reporting period amounted to HK$26,476,000, down from HK$56,064,000 as of March 31, 2019[35]. - Outstanding bank borrowings increased to HK$420,059,000 as of March 31, 2020, compared to HK$265,590,000 as of March 31, 2019[35]. - The current ratio decreased to 0.72 from 1.61 as of March 31, 2019, indicating a decline in liquidity[37]. - The gearing ratio rose to 1.19 from 0.42 as of March 31, 2019, reflecting increased financial leverage[37]. - The amount of assets pledged to secure banking facilities increased to HK$439,360,000 as of March 31, 2020, from HK$329,104,000 as of March 31, 2019[42]. Cost Management and Operational Challenges - Management implemented cost-reduction measures, including lowering inventory levels and negotiating rent concessions, to improve liquidity[23][25]. - The Group's operational challenges were exacerbated by social unrest in Hong Kong and the impact of the COVID-19 epidemic on consumer sentiment[20][24]. - The fashion business sales in Hong Kong and Macau increased by over 70% in May 2020 compared to April 2020[28]. Employee and Corporate Governance - As of March 31, 2020, the Group had approximately 1,300 employees, a decrease from approximately 1,700 employees as of March 31, 2019[46]. - The Company has distributable reserves amounting to HK$53,135,000 and retained profits of HK$1,478,000 as of March 31, 2020, compared to HK$6,663,000 in retained profits in 2019[57]. - No interim or final dividends were declared for the year ended March 31, 2020[53]. - The Company recognizes employees, customers, suppliers, and business partners as key stakeholders for corporate success[50]. - The Company has implemented a reward scheme for staff based on individual performance, including share options for key employees[46]. Board and Management Structure - The Board currently comprises six members, consisting of two executive directors, one non-executive director, and three independent non-executive directors[141]. - The roles of Chairman and Chief Executive Officer are clearly divided and performed by different individuals to ensure a balanced distribution of power[149]. - The Company has formalized written terms on the division of functions between the Board and management[162]. - Day-to-day management is delegated to the Chief Executive Officer and senior management, with Board approval required for significant transactions[163]. - Directors receive formal induction and continuous professional development to ensure they are informed about their responsibilities[174][175]. Corporate Governance Practices - The Company has complied with all code provisions as set out in the Corporate Governance Code throughout the year ended March 31, 2020[135]. - The Company continues to review its corporate governance practices to enhance standards and comply with regulatory requirements[135]. - The Audit Committee and the majority of the Remuneration and Nomination Committees are composed of independent non-executive directors, enhancing corporate governance[190]. - The Company has adopted a Board Diversity Policy, recognizing that increasing diversity at the Board level is essential for maintaining competitive advantage[198]. Share Options and Director Interests - The total number of shares to be issued upon exercise of the outstanding options is 19,080,000, representing approximately 0.8% of the issued share capital of the Company as of the report date[103]. - The interests of Mr. Cheng Chung Man, the founder, and Ms. Lam Yuk Sum, the Chief Executive Officer, in the shares of the Company are 1,393,347,737 and 272,916,013 respectively, representing 62.69% and 66.17% of the issued share capital[105]. - The Company has not entered into any arrangements that would allow directors to benefit from purchasing shares or debentures of the Company or any other company during the year[108].
威高国际(01173) - 2020 - 年度财报