Financial Performance - The Group's revenue for the year ended 31 December 2020 decreased to approximately HK$45.0 million, representing a decrease of approximately 23.4% compared to HK$58.7 million for the year ended 31 December 2019[19]. - The Group's net loss for the year ended 31 December 2020 decreased to approximately HK$15.6 million, a reduction of approximately 18.9% from HK$19.2 million for the year ended 31 December 2019[19]. - The decrease in net loss was primarily due to a reduction in impairment losses on financial assets by approximately HK$3.0 million[19]. - The finance cost also decreased by approximately HK$0.9 million during the year ended 31 December 2020 compared to the previous year[19]. - The Group's gross profit decreased to approximately HK$10.4 million for the year ended 31 December 2020, down from approximately HK$11.3 million for the year ended 31 December 2019, representing a decrease of approximately 8.0%[48]. - The Group's cost of sales decreased to approximately HK$34.5 million for the year ended 31 December 2020, down from approximately HK$47.4 million for the year ended 31 December 2019, representing a decrease of approximately 27.2%[44]. - Selling and distribution expenses decreased to approximately HK$5.7 million for the year ended 31 December 2020, down from approximately HK$7.4 million for the year ended 31 December 2019[50]. - Administrative expenses increased to approximately HK$15.4 million for the year ended 31 December 2020, up from approximately HK$13.5 million for the year ended 31 December 2019, representing an increase of approximately 14.1%[51]. - The Group recorded other losses, net of approximately HK$4.4 million for the year ended 31 December 2020, compared to other losses of approximately HK$2.7 million for the year ended 31 December 2019, representing an increase of approximately 64.1%[49]. - The total comprehensive expenses attributable to the owners of the parent decreased to approximately HK$11.5 million for the year ended 31 December 2020, down from approximately HK$20.6 million for the year ended 31 December 2019, representing a decrease of approximately 44.2%[60]. Revenue and Sales - The Group's overseas sales decreased by approximately 32.2%, while sales to the PRC decreased by approximately 20.9% compared to the previous year[23]. - Sales to the PRC market and overseas market decreased by 20.9% and 32.2% respectively due to the outbreak of Covid-19[43]. - The Group's revenue decreased to approximately HK$45.0 million for the year ended 31 December 2020, down from approximately HK$58.7 million for the year ended 31 December 2019, representing a decrease of approximately 23.4%[43]. Cash Flow and Assets - The Group's cash and bank balances decreased from approximately HK$34.5 million as of December 31, 2019, to approximately HK$11.9 million as of December 31, 2020[69]. - The current ratio improved from approximately 1.8 as of December 31, 2019, to approximately 3.8 as of December 31, 2020, due to the Rights Issue and settlement of bank borrowings[70]. - The Group's gearing ratio increased from approximately 3.1% as of December 31, 2019, to approximately 6.1% as of December 31, 2020[75]. - The Group had net current assets of approximately HK$35.5 million as of December 31, 2020, compared to approximately HK$28.0 million as of December 31, 2019[70]. Corporate Actions and Investments - The Group completed an acquisition of a new subsidiary engaged in interior design, fitting out, and decoration services in February 2021, aiming to diversify its business portfolio[24]. - The Group is conducting a feasibility study to invest in a new business related to quality thoroughbred horse racing and breeding operations[25]. - The Group completed the acquisition of Diamond Motto Limited on February 9, 2021, as part of its future plans for material investments[90]. - The Group aims to seek suitable investment opportunities to enhance its value and maximize returns to shareholders[25]. Corporate Governance - The company has adopted the corporate governance code as set out in Appendix 15 to the GEM Listing Rules, ensuring compliance with the standards[178]. - The Board believes that strong corporate governance practices are essential for safeguarding shareholder interests and ensuring accountability[177]. - The company is committed to regularly reviewing its corporate governance practices to meet the rising expectations of shareholders and stakeholders[178]. - The company has complied with the code provisions for the year ended December 31, 2020, except for a deviation from code provision A.2.1[179]. - The independent non-executive Directors have provided written confirmations of their independence, as required by the GEM Listing Rules[188]. Management and Staff - The Group's management is confident in the steady performance of its sewing threads business due to long-term relationships with customers and suppliers[32]. - The Group employed a total of 157 employees as of December 31, 2020, down from 172 employees in the previous year[104]. - The Group's total staff costs for the two years ended December 31, 2020, were approximately HK$17.3 million and HK$14.5 million, respectively[104]. - The financial controller is responsible for the financial control of the company, ensuring effective management of financial resources[168]. - The sales manager is primarily responsible for the sales and marketing strategies of the company, contributing to revenue growth[173]. Risk Management - The Group's treasury policies focus on reducing credit risk and managing liquidity risk through ongoing evaluations and monitoring[93]. - The Group is exposed to foreign currency risk related to transactions not denominated in its functional currency, primarily in the PRC[98]. - The Group has not granted any share options under its Share Option Scheme since its adoption on November 24, 2017[105]. Future Plans and Strategies - The Group plans to upgrade its industrial machinery for the production of 100% spun polyester sewing threads, with an expected utilisation of HK$20.3 million, of which HK$3.1 million has been utilised[126]. - The Group has allocated HK$7.7 million for upgrading machinery for domestic use, with HK$2.2 million already utilised[126]. - The Group has made repayments of approximately HK$20 million from the unutilised net proceeds towards banking facilities[128]. - The Group will continue to implement expansion plans in a prudent and conservative manner based on market conditions[135]. - The Directors will monitor and assess the situation and may modify expansion plans if they no longer suit the Group's operations[136].
维港育马(08377) - 2020 - 年度财报