Financial Performance - The total revenue for the six months ended June 30, 2021, was approximately RMB 115.6 million, representing a decrease of approximately 6.7% from RMB 123.9 million for the same period last year[15]. - The operating loss for the same period was approximately RMB 14.1 million, compared to an operating loss of approximately RMB 4.6 million for the same period last year[15]. - The net loss for the six months ended June 30, 2021, was approximately RMB 14.3 million, compared to a net loss of approximately RMB 5.3 million for the same period last year[16]. - Revenue through the online sales channel was approximately RMB 57.2 million, representing a decrease of approximately 12.4% from RMB 65.3 million for the same period last year[32]. - The core brand Bawang generated revenue of approximately RMB110.3 million, accounting for 95.4% of total revenue, representing a decrease of approximately 4.3% compared to the same period last year[36][42]. - The Royal Wind anti-dandruff haircare series generated revenue of approximately RMB1.9 million, accounting for 1.6% of total revenue, with a decrease of approximately 17.4% year-over-year[37][44]. - The Litao natural-based product series generated revenue of approximately RMB3.4 million, accounting for 2.9% of total revenue, reflecting a decrease of approximately 15.0% compared to the previous year[38][43]. - The Herborn skincare series generated revenue of approximately RMB0.1 million, accounting for 0.1% of total revenue, with a significant decrease of approximately 94.4% year-over-year[39][45]. - Loss before taxation for the period was RMB 14,338,000, compared to RMB 5,295,000 in the previous year, marking an increase of 170.5%[191]. - Loss for the period attributable to owners of the Company was RMB 14,338,000, compared to RMB 5,295,000 in the same period of 2020, representing an increase of 170.5%[192]. Cost and Expenses - Cost of sales amounted to approximately RMB75.7 million, a decrease of approximately RMB3.5 million (or 4.4%) from the previous year, but as a percentage of revenue, it increased from approximately 63.9% to 65.5%[47][48]. - Gross profit decreased to approximately RMB39.9 million, down approximately 10.9% from RMB44.8 million, with the gross profit margin decreasing from 36.1% to 34.5%[49][51]. - Selling and distribution costs increased to approximately RMB42.0 million, up approximately 12.9% from RMB37.2 million, with the percentage of revenue rising from 30.0% to 36.3%[50][52]. - Administrative expenses increased to approximately RMB14.1 million, representing a 7.6% increase from RMB13.1 million, primarily due to higher salaries and research and development expenses[54][59]. - The Group recorded an operating loss of approximately RMB14.1 million, compared to a loss of approximately RMB4.6 million in the same period last year, attributed to decreased revenue and increased marketing expenses[56][61]. Distribution and Sales Channels - As of June 30, 2021, the Bawang brand distribution network comprised 882 distributors and eight key account retailers, covering 26 provinces and four municipalities in China[24]. - The Royal Wind brand distribution network included 139 distributors, also covering 26 provinces and four municipalities in China as of June 30, 2021[25]. - The Litao products distribution network comprised 104 distributors and five key account retailers, targeting second-tier and third-tier cities in China as of June 30, 2021[26]. - The Group has established online flagship stores for its brands on 14 online retailing platforms in China, aiming to deepen efforts in this channel[27]. - The Group intends to optimize operations and stabilize market share for hot-selling items such as anti-hair fall products through its online flagship stores[88]. - The Group will continue to deepen cooperation with distributors and stimulate sales revenues through promotional activities during key holidays and events[87]. Corporate Strategy and Future Plans - The Group plans to launch four new anti-dandruff product series under the Royal Wind brand to cater to young consumers, primarily sold through conventional channels[80]. - The Group aims to enhance revenue for Bawang-branded products by leveraging consumer confidence in domestic products and appointing internet celebrities as brand ambassadors[79]. - The Group plans to launch several herbal shampoo products under the BaWang brand to expand its product range and will sell these through traditional channels[89]. - The Group aims for stable sales growth in e-commerce channels, optimizing operations and developing high-end products to maintain market share[90]. - The OEM business has seen substantial growth in the first half of the year, with plans to strengthen customer relationships and expand into different personal care products[95]. Assets and Liabilities - As of June 30, 2021, cash and cash equivalents were RMB 101.4 million, down from RMB 122.3 million as of December 31, 2020[105]. - Total assets decreased to RMB 227.6 million as of June 30, 2021, from RMB 264.6 million as of December 31, 2020[105]. - The Group maintains a gearing ratio of 0%, indicating no outstanding loans as of the reporting date[105]. - As of June 30, 2021, the Group's trade and other payables were approximately RMB69.6 million, representing a decrease of 14.1% from RMB81.1 million as of December 31, 2020[121]. - The total personnel expenses for the six months ended June 30, 2021, amounted to approximately RMB27.3 million, down from approximately RMB29.0 million for the same period in 2020[131]. - The Group employed 495 employees as of June 30, 2021, compared to 508 employees as of June 30, 2020[131]. Shareholding and Corporate Governance - CHEN Qiyuan holds a long position of 1,900,840,000 ordinary shares, representing approximately 60.12% of the issued share capital of the Company[141]. - CHEN Zheng He also holds a long position of 1,900,840,000 ordinary shares, equivalent to approximately 60.12% of the issued share capital of the Company[141]. - WONG Sin Yung has a long position of 2,100,000 ordinary shares, accounting for about 0.07% of the issued share capital of the Company[141]. - The Company has no substantial shareholders other than the directors and chief executives with interests or short positions in shares as of June 30, 2021[150]. - The overall structure of shareholding shows a concentrated ownership with key individuals holding substantial percentages of the Company’s shares[141]. - The company has complied with the applicable code provisions of the Corporate Governance Code during the reporting period[177]. Cash Flow and Financial Position - The net cash used in operating activities was RMB 15,016,000, compared to cash generated of RMB 19,125,000 in the same period of 2020, reflecting a decrease of approximately 178%[196]. - The company reported a net cash inflow from investing activities of RMB 288,000, a recovery from a net cash outflow of RMB 9,826,000 in the previous year[198]. - The net cash used in financing activities was RMB 6,255,000, down from RMB 13,770,000 in the same period of 2020, indicating a reduction of approximately 54%[198]. - The company experienced a net decrease in cash and cash equivalents of RMB 20,983,000 for the six months ended June 30, 2021, compared to a decrease of RMB 4,471,000 in the same period of 2020[198].
霸王集团(01338) - 2021 - 中期财报