进腾集团(02011) - 2020 - 年度财报

Company Profile Corporate Information This section provides core corporate data, including board composition, key advisors, and registered office details - The Board of Directors comprises four executive directors, one non-executive director, and three independent non-executive directors[6] - The company's auditor is BDO Limited[7] Financial Highlights Five-Year Financial Summary This section presents key financial performance and position indicators over the past five years, highlighting operational challenges in 2020 Five-Year Financial Summary (2016-2020) | Metric | 2020 | 2019 | 2018 | 2017 | 2016 (Restated) | | :--- | :--- | :--- | :--- | :--- | :--- | | Results from Continuing Operations | | | | | | | Revenue (HK$ million) | 170.09 | 205.80 | 197.53 | 184.73 | 145.57 | | Gross Profit (HK$ million) | 34.24 | 52.93 | 63.92 | 57.70 | 42.07 | | Gross Profit Margin (%) | 20.1 | 25.7 | 32.4 | 31.2 | 28.9 | | Net Loss Margin (%) | -27.6 | -21.5 | -16.8 | -24.4 | 15.1 (Profit Margin) | | Financial Position (HK$ '000) | | | | | | | Total Assets | 290,702 | 338,348 | 330,454 | 380,180 | 405,760 | | Total Equity Attributable to Equity Holders | 151,873 | 216,657 | 264,730 | 314,083 | 298,523 | | Financial Ratios | | | | | | | Current Ratio (times) | 1.9 | 3.2 | 6.0 | 5.0 | 4.0 | | Gearing Ratio (%) | 40.5 | 29.3 | 12.9 | 11.4 | 21.6 | | Inventory Turnover (days) | 82 | 70 | 66 | 62 | 58 | | Trade Receivables Turnover (days) | 91 | 72 | 74 | 77 | 78 | Consolidated Statement of Profit or Loss Summary (2020 vs 2019) (HK$ '000) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Revenue | 170,089 | 205,796 | | Gross Profit | 34,235 | 52,932 | | Operating Loss | (50,232) | (39,255) | | Loss Before Tax | (53,894) | (43,000) | | Loss for the Year | (51,209) | (44,164) | | Loss Attributable to Equity Holders of the Company | (46,907) | (44,180) | Consolidated Statement of Financial Position Summary (2020 vs 2019) (HK$ '000) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Non-current Assets | 152,018 | 142,345 | | Current Assets | 138,684 | 196,003 | | Total Assets | 290,702 | 338,348 | | Current Liabilities | 71,247 | 60,671 | | Non-current Liabilities | 46,414 | 38,381 | | Net Assets | 173,041 | 239,296 | | Total Equity Attributable to Equity Holders of the Company | 151,873 | 216,657 | Chairman's Statement Chairman's Statement The Chairman addresses the significant impact of the COVID-19 pandemic on revenue and outlines the Group's future strategy for growth - Due to the COVID-19 pandemic, global travel restrictions severely impacted customer demand, leading to a significant decline in the Group's revenue[25] - The Group has implemented strict cost control measures and maintained stable performance in its overall zipper business[25] - Looking ahead, the Group will continue to seek attractive investment and acquisition opportunities in other industries to enhance profitability and maximize shareholder value[25] Management Discussion and Analysis Business Overview The Group's continuing operation in 2020 was the zipper business, primarily serving OEMs for Chinese and international apparel brands - The Group's core business is zipper manufacturing, with customers being primarily OEM manufacturers for Chinese and international apparel brands[29] Financial Summary In FY2020, the Group's revenue decreased to HK$170 million and its pre-tax loss widened to HK$53.89 million due to multiple factors Key Financial Indicator Changes for FY2020 | Indicator | 2020 (HK$ million) | 2019 (HK$ million) | Change | | :--- | :--- | :--- | :--- | | Revenue | 170.09 | 205.80 | ↓17.4% | | Loss Before Tax | 53.89 | 43.00 | ↑25.3% | - The increase in pre-tax loss was mainly due to: - Gross profit decreased from HK$52.93 million to HK$34.24 million - Recognition of impairment losses on property, plant and equipment of HK$8.22 million and on right-of-use assets of HK$4.89 million - A net foreign exchange loss of HK$10.13 million (2019: gain of HK$2.83 million) - The loss was partially offset by a fair value gain on financial assets at FVTPL of HK$1.53 million (2019: loss of HK$23.60 million)[30] Revenue Analysis Total revenue in 2020 decreased by 17.4% to HK$170 million, driven by a decline in core product sales due to the COVID-19 pandemic Revenue by Product Category (HK$ million) | Product Category | 2020 | % of Total Revenue | 2019 | % of Total Revenue | | :--- | :--- | :--- | :--- | :--- | | Finished Zippers and Sliders | 167.42 | 98.4% | 202.22 | 98.3% | | Others | 2.67 | 1.6% | 3.58 | 1.7% | | Total Revenue | 170.09 | 100.0% | 205.80 | 100.0% | Revenue by Geographical Location (HK$ million) | Region | 2020 | % of Total Revenue | 2019 | % of Total Revenue | | :--- | :--- | :--- | :--- | :--- | | Mainland China | 150.18 | 88.3% | 183.00 | 88.9% | | Overseas | 19.91 | 11.7% | 22.80 | 11.1% | | Total Revenue | 170.09 | 100.0% | 205.80 | 100.0% | - The decrease in revenue from finished zippers and sliders was mainly due to the global COVID-19 pandemic, which led to a reduction in sales orders from customers (primarily apparel product OEMs)[35] Cost of Sales and Gross Profit In 2020, cost of sales decreased, but a larger revenue decline led to a 35.3% drop in gross profit and a lower gross margin Gross Profit and Gross Margin Changes | Indicator | 2020 | 2019 | Change | | :--- | :--- | :--- | :--- | | Cost of Sales (HK$ million) | 135.85 | 152.86 | ↓11.1% | | Gross Profit (HK$ million) | 34.24 | 52.93 | ↓35.3% | | Gross Margin (%) | 20.1% | 25.7% | ↓5.6pp | Operating Expenses Distribution costs decreased in line with revenue in 2020, while administrative expenses remained stable but increased as a percentage of revenue - Distribution costs were approximately HK$11.76 million, a year-on-year decrease mainly due to lower staff and transportation costs in line with reduced revenue[42] - Administrative expenses were approximately HK$54.25 million, remaining stable year-on-year, but its ratio to turnover increased to 31.9%[43] Profitability In 2020, the loss attributable to equity holders widened to HK$46.91 million, with the loss ratio and ROE indicating deteriorating profitability Profitability Indicators | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Loss Attributable to Equity Holders (HK$ million) | 46.91 | 44.18 | | Loss Attributable to Equity Holders as a % of Revenue | 27.6% | 21.5% | | Return on Equity (%) | -30.9% | -20.4% | Financial Position Analysis The company redeemed all financial assets at FVTPL in 2020, while inventory and receivables turnover days increased, indicating lower operational efficiency - In March 2020, the company redeemed all its remaining shares in the Fullgoal Strategic Growth Fund for net proceeds of approximately HK$24.89 million and no longer holds any interest in the fund[49][50] - Inventory turnover days increased from 70 days in 2019 to 82 days in 2020[53] - Trade receivables turnover days increased from 72 days in 2019 to 91 days in 2020[56] - Trade payables turnover days increased from 21 days in 2019 to 26 days in 2020[59] Liquidity and Capital Resources The Group's operating cash flow turned positive in 2020, but a significant outflow from financing activities led to a decrease in year-end cash Cash Flow Summary (HK$ million) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Net cash from/(used in) operating activities | 18.67 | (1.37) | | Net cash from investing activities | 3.02 | 34.61 | | Net cash used in financing activities | (56.59) | (22.09) | | Net (decrease)/increase in cash and cash equivalents | (34.90) | 11.15 | | Cash and cash equivalents at year-end | 60.93 | 91.17 | - The Group had no borrowings at the end of 2019 and 2020, other than lease liabilities[66] - The Group's strategy is to maintain an adjusted net debt-to-capital ratio below 20%; the ratio was 1.9% at the end of 2020[66] - Net current assets decreased significantly from HK$135 million to HK$67.44 million, mainly due to the redemption of financial assets and payment of a special dividend[67] Other Matters This section covers foreign exchange risk, employee information, a change in the company's name, and adjustments to director remuneration - As of the end of 2020, the Group had 694 full-time employees, a decrease from 816 in 2019, with staff costs decreasing from HK$90.61 million to HK$78.70 million[73] - The company's English name was changed from "KEE Holdings Company Limited" to "China Apex Group Limited", and its Chinese name was also changed[76] - Executive Directors Mr. Zhuang Weidong, Mr. Qiu Chuanzhi, and Mr. Mai Rongbin voluntarily waived part of their remuneration to support the company's development[78] Connected Transactions This section discloses multiple transactions with connected persons, primarily involving lease renewals and equipment purchases from entities controlled by former controlling shareholders - The Group renewed the lease for its Hong Kong property with connected party Shing Tin Limited for two years at a monthly rent of HK$60,000[79] - The Group renewed the lease for its Zhejiang production base with a connected party for two years at a monthly rent of RMB 417,300[82] - The Group renewed the lease for its Guangdong factory premises with connected persons Mr. Hui Sik Pang and Mr. Hui Sik Nam for two years at a monthly rent of RMB 394,000[83] - The Group purchased dyeing equipment from a connected party, KEE (Jingmen) Garment Accessories Company Limited, for a consideration of RMB 6.718 million[88] Business Outlook The Group anticipates a gradual market recovery and will implement six key measures to address challenges and capture potential growth opportunities - Despite weak domestic and external demand, the Group believes the apparel and textile industry is gradually recovering as the pandemic comes under control[98] - The Group will implement six key measures to address challenges and seize market opportunities: 1. Expand into the e-commerce market and enhance product quality 2. Integrate and upgrade production capacity to improve the industrial chain 3. Optimize processes and strengthen cost management 4. Enhance capital management to control operational risks 5. Accelerate digital transformation 6. Strengthen talent management to improve organizational capabilities[100] Corporate Governance Report Corporate Governance Practices This report details the company's corporate governance practices for 2020, confirming compliance with most code provisions while noting some deviations - For the year ended December 31, 2020, the company complied with all code provisions of the Corporate Governance Code, except for the deviation where the roles of Chairman and Chief Executive Officer were not separated[105][112] - The Board consists of eight members, including four executive directors, one non-executive director, and three independent non-executive directors, meeting Listing Rules requirements[107][113] - The company has established an Audit Committee, a Remuneration Committee, and a Nomination Committee, with their compositions, duties, and meeting records detailed[122][125][130][133] - The Group appointed an external independent consultant for an annual review of its internal control system, which the Board deemed effective as of year-end 2020[146][149] Environmental, Social and Governance (ESG) Report Environmental Aspect The Group manages its environmental impact through an ISO 14001-based system, focusing on emissions control and resource efficiency Key Emissions Data for 2020 | Emission Type | Unit | Total Emissions | Intensity (per HK$ million of revenue) | | :--- | :--- | :--- | :--- | | Greenhouse Gases (Scope 1, 2, 3) | Tonnes of CO2e | 14,172 | 83.3 | | Wastewater | Tonnes | 46,110 | 271.1 | | Hazardous Waste | Tonnes | 4.5 | 0.03 | | Non-hazardous Waste | Tonnes | 52 | 0.31 | Key Resource Consumption Data for 2020 | Resource | Unit | Total Consumption | Intensity (per HK$ million of revenue) | | :--- | :--- | :--- | :--- | | Electricity (Factory) | kWh | 11,438,255 | 67,249 | | Water | Tonnes | 305,064 | 1,794 | | Diesel | Litres | 423,115 | 2,488 | | Natural Gas | m³ | 210,787 | 1,239 | Social Aspect (Employment and Labor Practices) The Group prioritizes employee welfare, fair employment, and workplace safety, with detailed data on workforce composition and training provided - As of year-end 2020, the Group had 694 full-time employees, down from 816 in 2019, with an overall employee turnover rate of approximately 47% for the year[184] Occupational Health and Safety Statistics | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Lost days due to work injury | 466 | 282 | | Number of work-related fatalities | 0 | 0 | | Number of work-related injuries | 11 | 17 | - The Group provided various internal and external training for employees, with male employees receiving an average of 2.45 training hours and female employees receiving 2.76 hours in 2020[192][193] - The Group strictly adheres to labor standards and had no incidents of child or forced labor during the reporting period[196] Social Aspect (Operating Practices and Community Investment) The Group maintains robust supply chain management, product responsibility, and anti-corruption practices while actively investing in its community - The Group has 349 suppliers, all located in Mainland China, to reduce the carbon footprint from transportation[198] - The Group's production bases are certified under ISO 9001 and OEKO-TEX® STANDARD 100; in 2020, it received 49 customer complaints and had no product recalls due to health and safety issues[200] - The Group has an anti-fraud and whistle-blowing system and received no reports of corruption during the reporting period[204][207] - The Group's "KEE Charity Foundation" assists employees in need and donated RMB 225,900 to the Red Cross to combat the COVID-19 pandemic[208] Biographical Details of Directors and Senior Management Biographical Details of Directors and Senior Management This section provides detailed professional backgrounds of the company's directors and senior management team - Provides the biographies of Executive Directors Mr. Zhuang Weidong (Chairman), Mr. Qiu Chuanzhi (President), Mr. Wu Hangzheng (Vice Chairman), and Mr. Mai Rongbin (Vice President)[211][212][213] - Provides the biographies of Non-executive Director Ms. Lin Ping and three Independent Non-executive Directors, Mr. Cheng Hong Kei, Mr. Liu Huaijing, and Mr. Leung Kar Tin[215][216][217][218] - Provides the biographies of senior management members, including Chief Financial Officer Mr. Yau Chi Chiu[220][221] Report of the Directors Report of the Directors This report presents statutory disclosures for the year ended December 31, 2020, covering business review, financial results, and shareholder information - The company's principal activity is the design, manufacture, and sale of finished zippers and other garment accessories in China[224] - The company paid a special dividend of HK$0.075 per share on March 3, 2020, and the Board does not recommend a final dividend for 2020[229] Percentage of Major Customers and Suppliers in Total Turnover | Category | 2020 (%) | 2019 (%) | | :--- | :--- | :--- | | Largest Customer | 4.4 | 4.6 | | Five Largest Customers | 14.3 | 16.1 | | Largest Supplier | 10.0 | 12.8 | | Five Largest Suppliers | 29.1 | 33.5 | - The Board has reviewed the continuing connected transactions for the year and confirmed they were conducted in the ordinary course of business on normal commercial terms, fair and reasonable, and in the interests of shareholders as a whole[264] Independent Auditor's Report Audit Opinion and Key Audit Matters The independent auditor issued an unqualified opinion on the financial statements, highlighting inventory valuation and asset impairment as key audit matters - The auditor concluded that the consolidated financial statements give a true and fair view of the Group's financial position and performance in accordance with HKFRSs, issuing an unqualified opinion[276] - Key Audit Matter 1: Valuation of inventories, which was significant due to the material carrying amount and the judgment involved in determining provisions[281] - Key Audit Matter 2: Impairment assessment of non-financial assets, which was critical due to impairment indicators such as declining gross profit margins and continuous losses in the zipper business[283][284] Consolidated Financial Statements Consolidated Statement of Profit or Loss The Group's revenue for FY2020 was HK$170 million, with the loss for the year widening to HK$51.21 million Key Data from Consolidated Statement of Profit or Loss (HK$ '000) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Revenue | 170,089 | 205,796 | | Gross Profit | 34,235 | 52,932 | | Loss before tax | (53,894) | (43,000) | | Loss for the year | (51,209) | (44,164) | | Loss attributable to equity holders of the Company | (46,907) | (44,180) | | Basic and diluted loss per share (HK cents) | (10.1) | (9.5) | Consolidated Statement of Profit or Loss and Other Comprehensive Income The total comprehensive loss for the year narrowed to HK$31.40 million, primarily due to a positive foreign currency translation difference Key Data from Consolidated Statement of Comprehensive Income (HK$ '000) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Loss for the year | (51,209) | (44,164) | | Exchange difference on translation of financial statements of subsidiaries in Mainland China | 19,814 | (4,474) | | Total comprehensive income for the year | (31,395) | (48,638) | | Total comprehensive income attributable to equity holders of the Company | (29,924) | (48,073) | Consolidated Statement of Financial Position As of December 31, 2020, the Group's total assets decreased to HK$291 million, with net assets declining to HK$173 million Key Data from Consolidated Statement of Financial Position (HK$ '000) | Item | 31 December 2020 | 31 December 2019 | | :--- | :--- | :--- | | Total Assets | 290,702 | 338,348 | | Total Liabilities | 117,661 | 99,052 | | Net Assets | 173,041 | 239,296 | | Total equity attributable to equity holders of the Company | 151,873 | 216,657 | | Non-controlling interests | 21,168 | 22,639 | | Total Equity | 173,041 | 239,296 | Consolidated Statement of Changes in Equity Total equity attributable to shareholders decreased from HK$217 million to HK$152 million in FY2020, driven by the annual loss and dividend payments - Total equity attributable to the Company's equity holders decreased from HK$217 million at the beginning of the year to HK$152 million at year-end[310] - The main items causing the decrease in equity were the loss for the year of HK$46.91 million and the payment of a special dividend of HK$34.86 million[310] - An increase in the exchange reserve of HK$16.98 million partially offset the reduction in equity[310] Consolidated Statement of Cash Flows The Group's operating activities generated a net cash inflow, but financing outflows led to a net decrease in cash and cash equivalents for FY2020 Key Data from Consolidated Statement of Cash Flows (HK$ '000) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Net cash from/(used in) operating activities | 18,668 | (1,372) | | Net cash from investing activities | 3,015 | 34,607 | | Net cash used in financing activities | (56,587) | (22,086) | | Net (decrease)/increase in cash and cash equivalents | (34,904) | 11,149 | | Cash and cash equivalents at 31 December | 60,930 | 91,174 | Notes to the Consolidated Financial Statements Summary of Notes to the Financial Statements This section provides detailed notes on the basis of preparation, accounting policies, key estimates, and segmental analysis for the financial statements - The financial statements are prepared in accordance with Hong Kong Financial Reporting Standards and presented in Hong Kong dollars[318][345] - Note 6 provides a detailed disclosure of the Group's two reportable segments: Zippers (Mainland China) and Zippers (Overseas), including revenue, profit/loss, and asset information for each[442][443][444] - Notes 14 and 23(b) disclose that due to declining gross profit margins and continuous losses in the zipper business, the Group recognized impairment losses of HK$8.215 million on property, plant and equipment and HK$4.885 million on right-of-use assets[492][498][550] - Note 31 details significant transactions with related parties, primarily property leases and equipment purchases from companies controlled by former controlling shareholders[595][597] Glossary Definitions This section provides clear definitions for specific terms and abbreviations used throughout the annual report to aid reader comprehension - This section provides definitions for the technical terms and abbreviations used in the report[633]