Financial Performance - The company recorded a net loss of approximately HKD 56 million for the six months ended June 30, 2024, compared to a net loss of approximately HKD 714 million for the corresponding period in 2023, representing a significant reduction in losses [3]. - Total sales for the period were approximately HKD 1.557 billion, a decrease of about 49% from approximately HKD 3.025 billion in the corresponding period [3]. - Gross profit for the period was approximately HKD 652 million, down about 52% from approximately HKD 1.352 billion in the corresponding period [3]. - The company experienced an operating loss of approximately HKD 85 million, a reduction of about 88% compared to an operating loss of approximately HKD 703 million in the corresponding period [3]. - The company reported a total loss of HKD 85 million for the six months ended June 30, 2024, compared to a loss of HKD 703 million in the same period last year, showing an improvement in financial performance [53][57]. - The company reported a net loss attributable to shareholders of approximately HKD 56 million for the six months ended June 30, 2024 [35]. - The company reported a total loss attributable to shareholders of HKD 56 million for the six months ended June 30, 2024, compared to a loss of HKD 714 million for the same period in 2023, indicating a significant improvement [67]. - Basic loss per share for the six months ended June 30, 2024, was HKD (0.020), compared to HKD (0.252) for the same period in 2023, reflecting a reduction in losses [67]. Revenue and Sales - The company's revenue for the six months ended June 30, 2024, was HKD 1,557 million, a decrease of 48.5% compared to HKD 3,025 million for the same period in 2023 [24]. - The group's revenue distribution across channels is approximately 38% e-commerce, 35% wholesale, 24% own retail stores, and 3% licensing [6]. - E-commerce revenue decreased by 47%, wholesale revenue decreased by 51%, and own retail store revenue decreased by 50% during the period [6]. - Revenue from Europe was HKD 917 million, while Asia contributed HKD 7 million, and online stores generated HKD 584 million, indicating a significant drop in all regions compared to the previous year [49][57]. Cost Management and Expenses - Operating expenses were approximately HKD 737 million, a 64% decrease from approximately HKD 2.055 billion in the corresponding period [8]. - Employee costs decreased to HKD 533 million for the six months ended June 30, 2024, from HKD 632 million in the previous year, indicating cost management efforts [62]. - Logistics expenses were reduced to HKD 162 million for the six months ended June 30, 2024, compared to HKD 241 million for the same period in 2023, showing improved operational efficiency [62]. - The total cash outflow for lease liabilities was HKD 233 million for the six months ended June 30, 2024, compared to HKD 348 million for the same period last year [32]. - The company incurred a total depreciation expense of HKD 34 million for property, plant, and equipment for the six months ended June 30, 2024, down from HKD 58 million in the previous year [62]. Asset and Liability Management - Trade payables as of June 30, 2024, were HKD 79 million, a decrease of approximately 79% from HKD 374 million as of December 31, 2023 [10]. - Inventory balance as of June 30, 2024, was HKD 8 million, a 99% decrease from HKD 1.301 billion as of December 31, 2023 [10]. - The group maintained a zero external interest-bearing debt ratio as of June 30, 2024 [12]. - Current assets decreased from HKD 2,588 million as of December 31, 2023, to HKD 361 million as of June 30, 2024 [27]. - Total liabilities decreased from HKD 3,796 million as of December 31, 2023, to HKD 790 million as of June 30, 2024 [27]. Strategic Initiatives - The company is focusing on expanding its licensing business and transforming into an intellectual property management company to maximize the monetization of the Esprit brand [4]. - The management team has begun restructuring to reduce legacy business infrastructure and personnel, aiming to limit overall costs and conserve cash [4]. - The company is actively discussing with multiple potential strategic partners to explore licensing opportunities for Esprit's intellectual property [4]. - The company is shifting its focus towards a licensing business model, aiming to maximize the value of its brand through strategic partnerships [19]. - The company is exploring new strategies for growth, including potential market expansion and product development, to enhance its competitive position [48]. Impairment and Provisions - Impairment losses on trademarks, rights-of-use assets, and property, plant, and equipment totaled approximately HKD 1.721 billion, along with provisions for inventory and trade receivables amounting to approximately HKD 1.361 billion [4]. - The company reported a significant impairment loss of HKD 1,721 million, which includes losses from retail and authorized operations, reflecting ongoing challenges in asset management [54][55]. - The company recognized an additional inventory provision of HKD 1.053 billion for the six months ended June 30, 2024, compared to a net increase of HKD 37 million for the same period in 2023 [62]. Corporate Governance and Compliance - The audit committee consists of four independent non-executive directors and has reviewed the group's accounting policies and practices during the period [104]. - The company has complied with the principles of the Corporate Governance Code as per the listing rules during the reporting period [104]. - The board decided not to declare an interim dividend for the period due to a net loss recorded by the group [16]. Future Outlook and Challenges - The group is facing high costs due to inflation, interest rates, energy prices, and the aftermath of the COVID-19 pandemic, which have weakened its financial condition [38]. - The ability to execute fundraising plans, cost control measures, and restructuring initiatives remains subject to significant uncertainty [41]. - The group is actively exploring various fundraising options, including seeking licensing opportunities, forming joint ventures, and selling part of its assets [38]. - The group is focused on improving liquidity and ensuring adequate financing for future business development [38].
思捷环球(00330) - 2024 - 中期财报