Financial Performance - CMON Limited's revenue increased from approximately $28.2 million in 2018 to about $30.5 million in 2019, representing a growth of approximately 8.1%[9] - The company reported an EBITDA of approximately $6.7 million for 2019, remaining roughly the same as the previous year, primarily due to increased game development expenses[9] - The company experienced a shareholder loss of approximately $0.8 million in the fiscal year, compared to a profit of about $2.0 million in the previous year, largely due to non-recurring professional service fees of $2.7 million related to the transfer to the main board[12] - Revenue increased by approximately 8.0% from about $28.2 million for the year ended December 31, 2018, to about $30.5 million for the year ended December 31, 2019, primarily due to an increase in board game revenue[15] - Board game revenue rose approximately 18.6% from about $23.3 million in 2018 to about $27.6 million in 2019, driven by higher sales from wholesalers and Kickstarter[15] - Kickstarter revenue increased from approximately $15.2 million in 2018 to about $16.8 million in 2019, attributed to the sales of four Kickstarter games launched in 2019[16] - North America and Europe accounted for approximately 87.5% and 92.8% of total revenue for the years ended December 31, 2019, and 2018, respectively[16] - Gross profit decreased by approximately 1.3% from about $14.8 million in 2018 to about $14.6 million in 2019, mainly due to increased inventory costs[22] - Gross margin fell by approximately 4.5 percentage points from about 52.5% in 2018 to about 48% in 2019, primarily due to lower profit margins on older inventory sold in the U.S.[22] - The company's profit attributable to equity holders decreased from approximately $2 million for the year ended December 31, 2018, to a loss of about $0.8 million for the year ended December 31, 2019, primarily due to increased professional service fees related to the transfer of listing[29] Strategic Initiatives - CMON Limited plans to establish a comprehensive office and warehouse in China in 2020, aiming to expand its workforce and enhance market penetration in the Asian market[13] - The company aims to enhance its game design capabilities and introduce high-quality intellectual properties as part of its long-term strategy for growth[13] - CMON Limited has initiated significant licensing agreements, including the highly anticipated "Marvel United" product, marking a diversification in its product strategy[8] - The company has a total of 93 games, including 87 board games, 3 model war games, 2 mobile games, and 1 computer game as of the report date[12] - The company successfully held the CMON Expo in Thailand in November 2019, highlighting its market focus in China and Southeast Asia[8] - The transition from GEM to the main board of the Hong Kong Stock Exchange occurred on November 19, 2019, reflecting the company's growth and strategic direction[6] - The company has no specific major investment plans but intends to acquire quality games to increase market share[40] - The company is exploring new markets in the Asia-Pacific region, including Japan, South Korea, Thailand, and Indonesia[51] Operational Expenses - Total sales and distribution expenses increased from approximately $5.7 million in 2018 to about $5.9 million in 2019, mainly due to increased patent expenses[25] - General and administrative expenses rose from about $5.6 million in 2018 to approximately $6.1 million in 2019, driven by professional service fees related to the listing transfer and game development expenses[26] - Financing costs increased from $229,650 in 2018 to $483,370 in 2019, primarily due to bank borrowings and the adoption of IFRS 16[27] - Other income rose from $80,232 in 2018 to $198,226 in 2019, mainly due to increased patent income[23] Cash Flow and Debt - As of December 31, 2019, the group had cash and cash equivalents of approximately $757,743, down from $2.8 million as of December 31, 2018[30] - Short-term bank borrowings increased from approximately $3.9 million as of December 31, 2018, to about $6.6 million as of December 31, 2019, due to an increase in the short-term financing limit from $2.5 million to $4 million[30] - The total bank borrowings of the group as of December 31, 2019, amounted to approximately $10.3 million, compared to $8.3 million as of December 31, 2018[32] - The group had a debt-to-asset ratio of approximately 44% as of December 31, 2019, compared to about 40.9% as of December 31, 2018[41] Shareholder Information - The board of directors did not recommend a final dividend for the year ending December 31, 2019, compared to zero in 2018[77] - The company reported a reserve available for distribution to equity holders of approximately $10.2 million as of December 31, 2019, compared to $9.6 million as of December 31, 2018[94] - Sales to the top five customers accounted for approximately 28.3% of the total revenue for the year ended December 31, 2019[89] - The top five suppliers accounted for approximately 98.0% of the total procurement, with the largest supplier alone accounting for about 66.0%[90] Corporate Governance - The company has a diverse board of directors with expertise in finance, law, and corporate governance, ensuring effective oversight[67][65] - The board consists of three executive directors, one non-executive director, and three independent non-executive directors as of December 31, 2019[146] - The company has achieved its measurable target of having at least one-third of the board members as independent non-executive directors[149] - The company has adopted a board diversity policy to enhance effectiveness, considering factors such as age, education, professional experience, and skills[147] - The board meets quarterly to review the operations led by the chairman and co-CEO, ensuring effective management and business development[142] - The company has established three board committees: Audit Committee, Remuneration Committee, and Nomination Committee to oversee specific matters[143] - The company has confirmed compliance with the non-competition agreement by its controlling shareholders for the year ended December 31, 2019[127] Risk Management and Internal Controls - The company has established a framework for risk management and internal control systems, which is regularly evaluated for adequacy and effectiveness[164] - The audit committee has been reviewing the effectiveness of the company's risk management and internal control systems, including discussions with management and independent third-party reports[186] - The company has engaged an independent third party to conduct an internal control review to ensure the effectiveness and adequacy of its internal control systems[183] - The company has implemented all internal control recommendations proposed by Mazars following an independent investigation report[187] Employee Relations - The company has maintained good working relationships with employees, with no labor disputes reported during the year[87] - The total employee cost for the year ended December 31, 2019, was approximately $3.4 million, consistent with the previous year[38] Environmental and Social Responsibility - The company has implemented measures to reduce paper usage and energy consumption in its operations[85] - The company has taken environmental considerations into account during product design and production phases[85] Share Options and Securities - As of December 31, 2019, the total number of options granted under the share option scheme amounted to 91,620,000 shares, representing 10% of the company's issued share capital[117] - The share option scheme was adopted to reward and recognize eligible participants for their contributions to the group[114] - The maximum number of shares that may be issued under the share option scheme is capped at 180,600,000 shares, which is equivalent to 10% of the total issued shares as of the report date[116] - No options were exercised, cancelled, or lapsed during the year ended December 31, 2019, indicating a total of 180,600,000 shares available for issuance under the share option scheme[120] Audit and Compliance - The total remuneration for auditors for the year ended December 31, 2019, was approximately $459,570, comprising $420,000 for audit services and $39,570 for non-audit services[188] - The company appointed a new auditor, Zhonghui Anda CPA Limited, for the year ending December 31, 2020, following the resignation of the previous auditor[138] - The audit committee reviewed the consolidated financial performance for the year ended December 31, 2019[135]
CMON(01792) - 2020 - 年度财报