瓦普思瑞元宇宙(08093) - 2020 Q1 - 季度财报

Financial Statements This section presents the unaudited condensed consolidated financial statements, including profit or loss, comprehensive income, and equity changes, for the quarter ended September 30, 2019 Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the quarter ended September 30, 2019, revenue grew 41% to HK$133 million, but gross profit fell 56% to HK$6.1 million, resulting in a net loss of HK$2.724 million Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric (For the three months ended September 30) | 2019 (HK$ Thousand) | 2018 (HK$ Thousand) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 132,989 | 94,398 | +40.9% | | Cost of sales | (126,892) | (80,490) | +57.6% | | Gross profit | 6,097 | 13,908 | -56.2% | | Loss from operations | (2,280) | (2,481) | -8.1% | | Loss for the period | (2,724) | (2,727) | -0.1% | | Basic and diluted loss per share (HK cents) | (0.68) | (0.68) | 0.0% | Unaudited Condensed Consolidated Statement of Changes in Equity Total equity decreased from HK$210 million to HK$197 million, primarily due to a HK$2.724 million net loss and HK$10.394 million in exchange difference losses Equity Changes | Equity Changes (HK$ Thousand) | September 30, 2019 | July 1, 2019 | | :--- | :--- | :--- | | Total Equity | 196,747 | 209,865 | - The decrease in total equity was mainly due to two components: a loss for the period of HK$2.724 million, and exchange differences arising from the translation of foreign operations (loss on other comprehensive income) of HK$10.394 million[10] Notes to The Condensed Consolidated Financial Statements This section provides detailed notes on the unaudited condensed consolidated financial statements, covering general information, accounting policies, revenue, finance costs, income tax, loss per share, and dividends 1. General Information, Basis of Preparation and Accounting Policies The unaudited financial statements for the quarter, reviewed by the audit committee, are prepared under HKFRS with consistent accounting policies and no significant impact from new standards - This quarter's financial statements are unaudited by the company's auditors but have been reviewed by the company's audit committee[25][27] - Accounting policies remain consistent with the previous fiscal year's annual report, and the adoption of new standards has no significant impact[20][21] 2. Revenue Total revenue of HK$133 million was solely from internet advertising agency services, significantly up from HK$73.4 million, while the leather business generated no revenue Revenue Source | Revenue Source (For the three months ended September 30) | 2019 (HK$ Thousand) | 2018 (HK$ Thousand) | | :--- | :--- | :--- | | Internet advertising agency services | 132,989 | 73,403 | | Mobile payment technical support services | – | – | | Leather business | – | 20,995 | | Total | 132,989 | 94,398 | 3. Finance Costs Finance costs surged over 80 times to HK$508,000, driven entirely by new bank loan interest, indicating increased debt financing Composition of Finance Costs | Composition of Finance Costs (For the three months ended September 30) | 2019 (HK$ Thousand) | 2018 (HK$ Thousand) | | :--- | :--- | :--- | | Finance lease expenses | – | 6 | | Interest on bank borrowings | 508 | – | | Total | 508 | 6 | 5. Income Tax Expense No income tax expense was incurred this quarter, compared to HK$240,000 last year, partly due to tax exemptions for Horgos subsidiaries - No income tax expense was incurred this quarter, compared to HK$240,000 in the prior year[44] - Some of the company's subsidiaries registered in Horgos enjoy a five-year corporate income tax exemption tax incentive[78] 6. Loss Per Share Basic and diluted loss per share remained at HK$0.68 cents, consistent with the prior year due to stable net loss and shares in issue Loss Per Share Calculation | Loss Per Share Calculation | 2019 | 2018 | | :--- | :--- | :--- | | Loss attributable to owners of the Company (HK$ Thousand) | 2,724 | 2,727 | | Number of shares in issue (shares) | 400,000,000 | 400,000,000 | | Basic and diluted loss per share (HK cents) | (0.68) | (0.68) | 7. Dividend The Board did not recommend any dividend payment for the quarter - The Board did not recommend the payment of a dividend for the three months ended September 30, 2019[48] Management Discussion and Analysis This section provides an overview of the Group's business transformation, financial performance, liquidity, and significant events for the quarter ended September 30, 2019 Business Review and Outlook The Group has transformed into an internet advertising agency, operating domestically via Dongrun Network and internationally via Wanxing Network, with plans for increased investment and growth - The Group's core business is internet advertising agency services, with key domestic platforms including Dongqiudi, Cheetah Mobile, and Toutiao, and clients such as Tencent and Dianping[53][56] - The Group expands its overseas internet advertising market through its subsidiary Wanxing Network (MSIM) and platforms like Facebook[54][57] - The future outlook involves seizing industry opportunities, increasing investment in the internet advertising market, and expanding new clients and revenue streams[58][63] Financial Review Revenue grew 41% to HK$133 million, but surging cost of sales led to a 56% gross profit decline, while administrative expenses fell 47% due to an impairment reversal, resulting in a stable HK$2.7 million net loss Key Financial Indicators | Key Financial Indicators (For the three months ended September 30) | 2019 (HK$ Million) | 2018 (HK$ Million) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 133.0 | 94.4 | +41% | | Gross profit | 6.1 | 13.9 | -56% | | Administrative expenses | 7.8 | 14.7 | -47% | | Loss attributable to shareholders | 2.7 | 2.7 | 0% | - The significant decrease in administrative expenses was primarily due to the reversal of HK$2.9 million in net impairment losses on trade and other receivables[77][80] - The loss for the period was primarily due to the lower profit margin of internet advertising agency services and the decrease in revenue and profit from mobile payment technical support services[79][82] Financial Position, Liquidity and Financial Resources Cash and bank balances decreased to HK$16.5 million, while outstanding borrowings doubled to HK$28 million, causing the gearing ratio to rise from 7.0% to 14.2% Financial Position Indicators | Financial Position Indicators | September 30, 2019 | June 30, 2019 | | :--- | :--- | :--- | | Cash and bank balances (HK$ Million) | 16.5 | 23.5 | | Outstanding borrowings (HK$ Million) | 28.0 | 14.7 | | Gearing ratio | 14.2% | 7.0% | Material Acquisition and Disposal The Group did not undertake any material acquisition or disposal activities during the reporting period - For the three months ended September 30, 2019, the Group had no material acquisition and disposal activities[95][99] Other Information This section details shareholdings of directors, chief executives, and substantial shareholders, along with the audit committee's review of the financial results Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures As of September 30, 2019, directors Mr. Zhu Yongjun and Ms. Wang Fei held 9.60% and 10.00% of the company's shares Directors' Shareholdings | Director's Name | Capacity | Number of Shares Held (L) | Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Zhu Yongjun | Beneficial owner | 38,398,786 | 9.60% | | Ms. Wang Fei | Beneficial owner | 40,000,000 | 10.00% | Interests and Short Positions of Substantial Shareholders United Conquer Limited holds 22.40% as the largest direct beneficial shareholder, while Jin Shiqi International Holdings Co., Ltd. ultimately holds 34.90% through a multi-layered structure - United Conquer Limited holds 89,597,169 shares as a beneficial owner, representing 22.40% of the company[109] - Through a series of controlled corporate interests, including Shanghai Hutong, Shanghai Angju, and Zhongtian Group, Jin Shiqi International Holdings Co., Ltd. (Jin Shiqi) is ultimately deemed to hold 139,597,169 shares, representing 34.90% of the company[109][111][112] Audit Committee and Review of Financial Results The Audit Committee, composed of three independent non-executive directors, reviewed the unaudited quarterly financial results and recommended Board approval, though they were not externally audited - The Audit Committee has reviewed the quarterly results report and recommended it for Board approval[121][122] - The consolidated results for the quarter were unaudited by the company's auditors[121][123]