Corporate Social Responsibility - E Lighting has been recognized as a "Caring Company" for seven consecutive years, reflecting its commitment to social responsibility and community support[18]. - The Group participated in the "Fluorescent Lamp Recycling Programme" to reduce environmental risks associated with improper disposal of mercury-containing lamps[19]. Business Development and Market Strategy - The Group successfully opened two new retail stores in April and May 2021, including "PANALIVING" and "PHILIPS AT EL," aimed at increasing market share[21]. - E Lighting is actively developing smart home and COVID-19 related products, seeking new business opportunities in international trading[21]. - Despite a challenging business environment, E Lighting continues to implement a flexible sales and marketing strategy to enhance its market position[20]. - The retail market in Hong Kong is expected to gradually recover in late 2021, despite ongoing challenges from the COVID-19 pandemic[37]. - The Group plans to adopt cautious strategies to maintain competitiveness while responding to market changes and consumer needs[53]. Financial Performance - The Group's revenue for the financial year ended 31 March 2021 was approximately HK$82,227,000, representing an increase of approximately 18.3% from HK$69,515,000 in the previous year[31]. - Revenue from the retail chain business in lighting and designer label furniture was approximately HK$76,091,000, accounting for approximately 92.5% of the Group's total revenue, with a year-on-year increase of approximately 14.4%[32]. - Revenue from tableware, giftware, and other business was approximately HK$6,136,000, accounting for approximately 7.5% of the Group's total revenue, showing a significant increase of approximately 105% from HK$2,993,000 in the previous year[33]. - The Group recorded a gross profit of approximately HK$44,054,000 and a profit of approximately HK$8,157,000 for the financial year[34]. - The Group's net assets as of 31 March 2021 were approximately HK$24,650,000[34]. - The Group's gross profit was approximately HK$44,054,000, an increase of approximately 19.8% from HK$36,763,000 in the previous year, with an overall gross profit margin of approximately 53.6%[59]. - Selling and distribution expenses decreased by approximately 11.3% to HK$23,005,000 from HK$25,925,000 in the previous year, primarily due to reduced rental and related expenses[60]. - Administrative and other expenses increased by approximately 2.8% to HK$14,169,000 from HK$13,790,000, mainly due to increased staff bonuses[67]. - The Group recorded a profit of approximately HK$8,157,000 during the Financial Year, compared to a loss of approximately HK$4,932,000 in the previous year[68]. Tenancy Agreements and Lease Management - The renewal of the tenancy agreement for Shop 312 is effective from September 1, 2020, for a term of three years, with an aggregate rental value of approximately HK$2,482,000[75]. - The tenant will enjoy a two-month rent-free period at the beginning of the term, and an additional turnover rental of 12% on gross receipts exceeding the basic rental[75]. - The renewal terms for Shop 312 were determined after arm's length negotiations and are considered fair and reasonable by the Board[77]. - The renewal of the tenancy agreement for GCH 14B-D is effective from August 1, 2020, for a term of two years, with an aggregate rental value of approximately HK$1,706,000[80]. - The Group has leased the GCH 14B-D premises for around 15 years, ensuring stable operations without incurring additional relocation costs[81]. - The terms for GCH 14B-D were also determined after arm's length negotiations and are deemed to be in the interests of the Company and shareholders[82]. - The Group's strategy includes securing stable operations through renewing existing tenancy agreements to avoid disruptions in business growth[76]. - The rental agreements are aligned with the open market rent of comparable properties in nearby districts[77]. - The Group's approach to tenancy agreements reflects its commitment to maintaining operational stability and minimizing costs associated with relocation[81]. - The tenancy agreement for Shop L3–7 has an effective date of May 1, 2021, with a total rental value of approximately HK$1,802,000 over three years[85]. - The tenant will enjoy a two-month rent-free period at the beginning of the lease term, with an additional turnover rental of 15% on gross receipts exceeding the basic rental[85]. - The renewal of the tenancy agreement for Shop 637 has an effective date of November 21, 2020, with a total rental value of approximately HK$3,173,000 over two years[90]. - The tenant for Shop 637 will benefit from a half-month rent-free period, ensuring stable operations without incurring additional relocation costs[90]. - The terms for both tenancy agreements were determined after arm's length negotiations and are considered fair and reasonable by the Board[87][92]. - The new lease for Shop L3–7 is expected to create synergies with the existing retail network, facilitating expansion at a lower cost[86]. - The renewal of the tenancy agreement for Shop 637 secures stable operations and prevents disruption to the Group's business growth[91]. - Both agreements were entered into in the ordinary course of business, aligning with the interests of the Company and its shareholders[92]. - The renewal of the tenancy agreement for Shop 103 is effective from January 18, 2021, for a term of two years, with an aggregate rental value of approximately HK$2,045,000[96]. - The tenant is required to pay an additional turnover rental of 10% on monthly gross receipts exceeding the basic rental[96]. - The renewal terms for Shop MH20–30 were finalized on January 29, 2021, with an effective date of March 1, 2021, and an aggregate rental value of approximately HK$1,704,000 for two years[101]. - Both tenancy agreements were negotiated based on open market rents of comparable properties, ensuring fair and reasonable terms for the company and shareholders[98][103]. - The company aims to secure stable operations at these premises without incurring additional costs related to relocation or renovation[97][102]. - The rental agreements are part of the company's strategy to maintain uninterrupted business operations and support growth[97][102]. - The rental payments for both agreements will be made monthly using internal resources[96][101]. - The agreements involve independent third parties, ensuring compliance with corporate governance standards[98][101]. - The company continues to focus on its retail business in Hong Kong, necessitating regular tenancy agreements for retail stores[97][102]. - The terms of the agreements reflect normal commercial practices in the industry, aligning with the company's operational needs[98][103]. - The Group entered into a tenancy agreement for Shop 336 effective from March 20, 2021, for a term of two years, with a total rental value of approximately HK$3,235,000[106]. - The rental agreement for Shop 336 includes a 30-day rent-free period at the beginning of the term and an additional turnover rental of 15% on gross receipts exceeding the basic rental[106]. - The decision to lease Shop 336 is aimed at expanding the retail network at a lower cost and creating synergies with existing stores[107]. - The renewal of the tenancy agreement for Shop 345 was finalized on February 10, 2021, with a total rental value of approximately HK$1,857,000 for a two-year term[109]. - The rental agreement for Shop 345 also includes a monthly additional turnover rental of 15% on gross receipts exceeding the basic rental[114]. - Both tenancy agreements were negotiated based on comparable market rents and are considered fair and reasonable by the Board[108]. - The Group's strategy includes maintaining stable operations by renewing existing leases rather than incurring additional costs for relocating[106]. - The premises for both shops are strategically located to enhance the Group's retail presence in Hong Kong[107]. - The Group's retail business is focused on minimizing operational disruptions through effective lease management[106]. - The agreements reflect the Group's commitment to long-term growth and operational efficiency in the retail sector[107]. Governance and Management - The Group's executive directors have extensive experience in business management, with Mr. Hue Kwok Chiu having over 22 years and Mr. Hui Kwok Keung Raymond over 26 years in the lighting and furniture retail industry[149][152]. - The Group's independent non-executive directors, including Mr. Chung Wai Man and Mr. Leung Wai Chuen, bring a combined experience of over 61 years in accounting, taxation, and finance[160][166]. - Ms. Yeung Mo Sheung Ann has over 20 years of experience in the legal field, contributing to the Group's governance and compliance[171]. - The Group's remuneration policy is based on individual performance and may include discretionary bonuses linked to the Group's profitability[147]. - The Group is focused on business development and expansion plans, with a strategic emphasis on market strategy and operations led by its executive directors[151][155]. - The Group's management team is composed of individuals with strong educational backgrounds, including degrees from the University of Hong Kong and the Hong Kong Polytechnic University[150][154]. - The Group's independent directors are responsible for providing independent judgment on strategy, performance, resources, and conduct standards, ensuring robust governance[158][169]. - The Group's executive team includes a chief creative officer, emphasizing the importance of product design and innovation in its business strategy[153]. - The Group's board composition reflects a balance of executive and independent non-executive directors, enhancing decision-making and oversight[158][169]. - The Group's strategic focus includes leveraging the experience of its directors to navigate market challenges and capitalize on growth opportunities in the lighting sector[151][160]. - The company is committed to high standards of corporate governance to safeguard shareholder interests and enhance corporate value[183]. - The Board of Directors consists of three executive directors and three independent non-executive directors, ensuring a balanced governance structure[185]. - During the financial year, five board meetings and one general meeting were held, demonstrating active governance practices[192]. - The company has complied with the Corporate Governance Code during the financial year, reflecting adherence to established governance standards[186]. - The independent management team is led by experienced senior management, responsible for implementing the group's policies and strategies[190]. - The company has adopted a code of conduct for securities transactions by directors, ensuring compliance with required standards[184]. - The principal function of the Board is to approve overall business plans and strategies, indicating a strategic focus on governance[190]. - The company has made specific inquiries with all directors regarding compliance with securities trading standards, confirming adherence[187]. Financial Position and Resources - As of March 31, 2021, the Group had cash and bank balances of approximately HK$17,557,000, an increase from HK$7,750,000 in 2020[124]. - The Group's total equity attributable to the owners amounted to approximately HK$24,650,000 as of March 31, 2021, compared to HK$16,493,000 in 2020, reflecting a growth of approximately 49%[127]. - The Group had no bank borrowings as of March 31, 2021, maintaining a gearing ratio of nil, consistent with the previous year[124]. - Total remuneration for the Group for the financial year was approximately HK$16,963,000, up from HK$16,053,000 in 2020, indicating an increase of about 5.7%[139]. - The Group employed 49 staff as of March 31, 2021, an increase from 45 employees in 2020[139]. - The Group did not have any significant capital commitments or contingent liabilities as of March 31, 2021[137][128]. - The Group's treasury policy is conservative, ensuring that sales proceeds are deposited in reputable banks for security and liquidity[126]. - The lease transactions under the renewal agreements exceeded 5% but were below 25%, qualifying as discloseable transactions under GEM Listing Rules[118]. - The Group does not currently have a foreign currency hedging policy but monitors foreign exchange exposure, particularly with the Euro and Renminbi[134].
壹照明(08222) - 2021 - 年度财报