Financial Performance - Tsit Wing International Holdings Limited reported a significant increase in revenue, achieving HK$1.2 billion, representing a growth of 15% compared to the previous year[2]. - The company’s net profit for the year was HK$150 million, reflecting a 10% increase year-on-year[2]. - The company has set a performance guidance for the next fiscal year, projecting a revenue growth of 12%[2]. - The overall adjusted profit from continuing operations increased by more than 6% despite a 5.9% revenue decline in the Hong Kong restaurant sector[24]. - Adjusted profit for the year from continuing operations attributable to owners of the parent increased by HK$5.9 million, or 6.7%, from HK$87.4 million in 2018 to HK$93.3 million in 2019[69]. - The Group's revenue decreased by HK$46.1 million, or 5.5%, from HK$831.1 million in 2018 to HK$785.0 million in 2019, primarily due to a decline in sales volume of instant beverage mix products in Mainland China[65]. Market Expansion and Strategy - User data indicated a rise in active customers by 20%, reaching a total of 500,000 users[2]. - The company plans to expand its market presence in Southeast Asia, targeting a 25% increase in market share over the next three years[2]. - The Group plans to expand its frozen and chilled foods business, focusing on meat processing and supplying frozen processed food[26]. - The Group aims to strengthen its presence in Shanghai and three cities in the Greater Bay Area: Shenzhen, Dongguan, and Guangzhou[26]. - The company is expanding its market presence in Southeast Asia, targeting a 10% market share within the next two years[92]. - A strategic acquisition of a local competitor is anticipated to enhance operational capabilities and increase market penetration[92]. Product Development and Innovation - New product launches are expected to contribute an additional HK$200 million in revenue, with a focus on health-oriented food and beverage options[2]. - Research and development expenses increased by 30%, totaling HK$50 million, aimed at enhancing product innovation[2]. - New product launches are expected to contribute an additional $30 million in revenue, with a focus on innovative technology solutions[92]. - The company is investing $5 million in research and development to advance its product offerings and improve service delivery[92]. Corporate Governance - The company is committed to high standards of corporate governance, emphasizing transparency, independence, accountability, responsibility, and fairness[99]. - The company complied with the CG Code throughout the year ended December 31, 2019, except for code provision A.2.1 regarding the separation of roles between chairman and chief executive[99]. - The Board has delegated day-to-day management to executive Directors and senior management, while retaining final decision-making authority on specific matters[99]. - The company has established various committees to manage and oversee specific affairs, ensuring effective governance practices[99]. - The Board comprises six directors, including three executive directors and three independent non-executive directors, exceeding the Listing Rules requirement for independent directors[115]. Risk Management - The Group has activated risk-management measures, including a "Work from Home" policy and stricter hygiene standards[28]. - The internal audit department conducts independent reviews of key business processes and controls according to an annual audit plan approved by the Audit Committee[182]. - The risk governance structure includes the Board/Audit Committee, which is responsible for overall risk management and approving operational risk policies[184]. - The Board confirmed that the risk management and internal control systems were effective and adequate for the year ended December 31, 2019, with no significant concerns identified[188]. Financial Position and Investments - The Group's net current assets as of December 31, 2019, were HK$403.1 million, a decrease of HK$32.1 million from HK$435.2 million as of December 31, 2018, mainly due to the disposal of the discontinued operation[74]. - The gearing ratio as of December 31, 2019, was 4.8%, down from 29.1% as of December 31, 2018, primarily due to the settlement of interest-bearing bank borrowings[76]. - The total actual use of proceeds from the listing was HK$232.610 million, with an unutilized amount of HK$199.646 million as of December 31, 2019[80]. Challenges and Economic Outlook - The outbreak of COVID-19 is expected to dampen business climate and expansion opportunities in the food and beverage industry[28]. - Economic uncertainties, including COVID-19 and the U.S.-China trade war, are expected to challenge the catering industry in Hong Kong and Mainland China in the upcoming year[56]. - The Group will adopt a prudent approach to cope with the uncertain economy in Mainland China while maximizing returns to shareholders[26]. E-commerce and Digital Strategy - The establishment of the "Tsit Wing Flagship Store" on Tmall.com marks the Group's entry into the B2C and O2O markets[24]. - The Group's expansion in e-commerce is expected to support its traditional offline business[26]. - The Group intends to launch another online franchisee platform to invite strategic partners and international brands[24]. Corporate Social Responsibility - The management emphasized a commitment to sustainability, aiming to reduce operational carbon footprint by 30% over the next five years[92]. - The company has a strong focus on corporate social responsibility and overall human resources strategy planning[97].
捷荣国际控股(02119) - 2019 - 年度财报