德永佳集团(00321) - 2025 - 年度财报

Corporate & Shareholder Information This section outlines the company's governance structure, board members, financial details, and share information Corporate Structure and Governance This section outlines key corporate governance information for Texhong Textile Group Limited, including board members, committee compositions (audit, nomination, remuneration), company secretary, registered office, principal place of business, auditor, and legal advisors - The Board of Directors includes Executive Directors Poon Bun Chak (Executive Chairman), Ho Lai Hong (Chief Executive Officer), Poon Ho Tak, Ng Mo Ping, and Independent Non-executive Directors Cheng Shu Yung, Lo Chung Nin, Lam Kit Yi, Chan Yuk Mau (appointed from May 15, 2025)[4][6] - The Audit, Nomination, and Remuneration Committees are chaired or primarily composed of Independent Non-executive Directors, ensuring the independence of corporate governance[4][5][6][7] - The company is registered in Bermuda, with its principal place of business in Hong Kong, and its auditor is Ernst & Young[6][7] Financial and Share Information This section provides the company's principal bankers, official website, share listing location, stock code, trading unit, financial year-end date, and the financial information timetable for the upcoming year, including interim and annual results announcement dates, dividend payment dates, and AGM dates - The company's stock code is 321, listed on the Main Board of The Stock Exchange of Hong Kong, with a financial year-end date of March 31[9][10] 2024/2025 Fiscal Year Dividend Distribution Plan | Dividend Type | Dividend Per Share (HKD cents) | Payment Date | | :--- | :--- | :--- | | 2024 Interim Dividend | 1.0 | January 8, 2025 | | 2024 Special Interim Dividend | 3.0 | January 8, 2025 | | 2025 Proposed Final Dividend | 1.0 | October 9, 2025 | | 2025 Proposed Special Final Dividend | 5.0 | October 9, 2025 | - The 2025 Annual General Meeting will be held on August 21, 2025[11] Financial and Operational Highlights This section provides a concise overview of the company's key financial and operational performance metrics over the past five fiscal years Key Financial and Operational Metrics This section summarizes Texhong Textile Group's key financial and operational data for the past five fiscal years (2021-2025), including turnover, profit, total equity, total assets, various ratios, and employee numbers, illustrating trends in revenue, profitability, and efficiency 2025 Fiscal Year Key Financial Data | Metric | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Turnover | 5,585 | 5,367 | +4.1% | | Profit Attributable to Ordinary Equity Holders | 116 | 132 | -12.1% | | Total Equity | 4,769 | 4,793 | -0.5% | | Total Assets | 6,888 | 7,108 | -3.1% | | Basic Earnings Per Share (HKD cents) | 8.4 | 9.6 | -12.5% | | Dividend Per Share (HKD cents) | 10.0 | 7.0 | +42.9% | 2025 Fiscal Year Key Operational Metrics | Metric | 2025 | 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Current Ratio (times) | 2.8 | 3.0 | -6.7% | | Inventory to Turnover (days) | 81 | 105 | -22.9% | | Interest Coverage Ratio (times) | 2 | 4 | -50.0% | | EBITDA (HKD million) | 593 | 589 | +0.7% | | Total Employees | 9,799 | 9,849 | -0.5% | - In fiscal year 2025, the company's turnover increased by 4.1% to HKD 5,585 million, but profit attributable to ordinary equity holders decreased by 12.1% to HKD 116 million[12] - Dividend per share significantly increased by 42.9% to HKD 10.0 cents, primarily due to special dividends distributed to celebrate the Group's 50th anniversary[12][15] Chairman's Statement This statement provides an overview of the Group's financial performance, business operations, sustainability efforts, and future outlook, as presented by the Chairman Earnings and Dividends The Chairman reported the Group's financial performance for the year, with revenue growing by 4.1% to HKD 5,585 million, but gross profit decreasing by 6.3% and profit attributable to ordinary equity holders falling by 12.1% to HKD 116 million. The Board proposed a final dividend of HKD 1.0 cent and a special final dividend of HKD 5.0 cents per ordinary share, bringing the total annual dividend to HKD 10.0 cents per share, including interim and special interim dividends already paid 2025 Fiscal Year Performance and Dividends | Metric | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 5,585 | 5,367 | +4.1% | | Gross Profit | 1,320 | 1,409 | -6.3% | | Profit Attributable to Ordinary Equity Holders | 116 | 132 | -12.1% | | Total Dividend Per Ordinary Share (HKD cents) | 10.0 | 7.0 | +42.9% | | Core Profit Payout Ratio (excluding special dividends) | 76.9% | N/A | N/A | - To celebrate the Group's 50th anniversary, the Board proposed a special final dividend of HKD 5.0 cents per ordinary share[15][19] Business Review This year, the Group's textile and garment businesses made progress amidst a complex macroeconomic environment, with the integration of Vietnamese production facilities enhancing capabilities and driving revenue growth. Mainland China's retail business improved efficiency through store network optimization and centralized management, with e-commerce GMV doubling year-on-year. Hong Kong's retail business steadily recovered despite challenges - Vietnamese production facilities commenced full operation in early 2024, primarily producing high-volume fabric series, driving growth in export orders[16][17][20][21] - The Group continues to advance its 'China Plus One' strategy, utilizing dual production bases in Dongguan and Vietnam to diversify regional risks and meet diverse customer demands[17][21] - Mainland China's retail e-commerce Gross Merchandise Volume (GMV) surged twofold year-on-year to HKD 659 million[23][28] - Hong Kong's retail business experienced a steady recovery in the second half of the reporting period, driven by targeted promotional activities[23][28] Sustainable Development The Group is committed to sustainable development, establishing a Sustainability Committee and implementing low-carbon initiatives in daily operations, including solar panel installation and coal-to-gas conversion projects. The company will disclose Scope 3 greenhouse gas emissions data for the first time in its 2025 ESG report and focus on R&D of green, low-carbon textile products - A Sustainability Committee comprising three Executive Directors and cross-departmental senior management was established to advance the company's sustainability agenda[24][29] - Actively promoting solar panel installation, coal-to-gas conversion projects, and grid connection projects in daily operations to reduce carbon emissions[24][29] - Will disclose Scope 3 indirect greenhouse gas emissions data for the first time in the 2025 Environmental, Social and Governance Report, enhancing transparency of environmental impact[25][29] Outlook Facing global economic uncertainties, particularly the US reciprocal tariff policy effective April 2025, the Group will remain cautiously optimistic, continue to advance its 'China Plus One' strategy, optimize production capabilities, and continuously evaluate the Phase II expansion plan for its Vietnam factory. The retail business will restore profitability through product innovation, supplier network expansion, and market diversification, including into Southeast Asian markets - The global economic situation is fraught with uncertainty due to the US reciprocal tariff policy (effective April 2025), and the Group will remain cautiously optimistic[27][30] - Continue to advance the 'China Plus One' strategy, optimizing Dongguan and Vietnam production facilities to enhance the Vietnam factory's capability to produce high-value-added products[31][34] - The retail business will focus on offering innovative products, expanding the supplier network to reduce costs, and shortening production cycles[32][35] - In addition to Mainland China and Hong Kong markets, the Group will expand into Southeast Asian markets, actively exploring overseas business opportunities to achieve market diversification[32][35] 50th Anniversary Appreciation Chairman Mr. Poon Bun Chak, on behalf of the Board, thanked all stakeholders for their trust and support on the occasion of the Group's 50th anniversary. The Group will take this golden jubilee as a new starting point, upholding its commitments to shareholders, customers, society, and employees, and embracing a brighter future through continuous effort and transformation - 2025 marks a significant milestone as the 50th anniversary of Texhong Textile Group[33][36] - The Group pledges to continue rewarding shareholders, upholding customer quality, fulfilling corporate social responsibility, and nurturing employees[33][36] Management's Discussion and Analysis This section provides a detailed review and analysis of the Group's financial performance, operational results, and financial condition for the fiscal year, along with future development plans Review of Business and Future Development This section provides a detailed review of the Group's business performance for the fiscal year ended March 31, 2025, with total revenue increasing by 4.1%, but gross profit margin declining due to initial operations of the Vietnam factory and changes in product mix. Profit attributable to ordinary equity holders decreased by 12.1% year-on-year, impacted by non-operating factors such as increased finance costs, carbon emission fees, higher freight costs, and gains from the resumption of a Guangzhou warehouse. The Board proposed a full-year dividend of HKD 10.0 cents per share 2025 Fiscal Year Group Overall Financial Performance | Metric | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Total Revenue | 5,585 | 5,367 | +4.1% | | Gross Profit Margin | 23.6% | 26.3% | -2.7 percentage points | | Profit Attributable to Ordinary Equity Holders | 116 | 132 | -12.1% | | Total Annual Dividend (HKD cents per ordinary share) | 10.0 | 7.0 | +42.9% | - Non-operating factors include HKD 20 million in finance costs from the acquisition and expansion of the Vietnam factory, HKD 22 million in carbon emission fees, HKD 15 million in increased freight costs due to the Red Sea crisis, and HKD 89 million in gains from the resumption of the Guangzhou warehouse[38][43] Textile business Textile business revenue increased by 11.6% year-on-year to HKD 4,376 million, accounting for 78.4% of the Group's total revenue, primarily driven by new export orders from the Vietnam factory's commencement of operations. However, due to the initial operational phase of the Vietnam factory, the gross profit margin decreased by 1.0 percentage point to 15.3%. The Group plans to improve the Vietnam factory's gross profit margin and profitability by optimizing production processes, introducing advanced equipment, and employee training 2025 Fiscal Year Textile Business Key Data | Metric | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Net Sales | 4,376 | 3,921 | +11.6% | | Gross Profit Margin | 15.3% | 16.3% | -1.0 percentage points | | Proportion of Group's Total Revenue | 78.4% | 73.1% | +5.3 percentage points | | Capital Expenditure | 290 | 166 | +74.7% | - The Vietnam factory's commencement of operations opened new revenue streams for the Group, primarily through export orders from Japanese and North American retailers[41][44] - The Group expects the Vietnam factory's product portfolio to converge with that of the Dongguan factory in the future, producing higher value-added products to improve gross profit margin and profitability[45][46] Retail and distribution business Retail and distribution business revenue decreased by 16.4% to HKD 1,207 million, accounting for 21.6% of the Group's total turnover, but gross profit margin increased by 0.6 percentage points to 53.9%. The Mainland China market transitioned to an e-commerce-centric casual wear brand, with e-commerce GMV growing by 170.1%, and 94 underperforming self-operated stores were closed to optimize the network. The Hong Kong market experienced a sales decline due to multiple factors, but steadily recovered in the second half through promotional activities 2025 Fiscal Year Retail and Distribution Business Key Data | Metric | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Net Sales | 1,207 | 1,443 | -16.4% | | Gross Profit Margin | 53.9% | 53.3% | +0.6 percentage points | | Operating Loss | (168) | (114) | -47.4% | | EBITDA | 18 | 74 | -75.7% | | Capital Expenditure | 15 | 31 | -51.6% | - Mainland China's e-commerce business Gross Merchandise Volume (GMV) reached HKD 659 million, a year-on-year increase of 170.1%[50][52] - In Mainland China, 94 self-operated stores were net closed, representing 29.8% of self-operated stores in that market, to optimize the physical sales network and reduce losses[54][56] - Hong Kong retail business revenue decreased to HKD 562 million, primarily impacted by 'northbound consumption', outbound tourism, and e-commerce platform competition, though the sales decline eased in the second half[55][57] Other income and gains Total other income and gains increased by HKD 2 million to HKD 203 million, primarily comprising interest income, net fair value gains on foreign exchange derivative financial instruments, operating lease rental income from investment properties, government grants, and scrap sales income 2025 Fiscal Year Other Income and Gains | Item | 2025 (HKD thousand) | 2024 (HKD thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Interest income | 89,150 | 85,516 | +4.2% | | Net fair value gains on foreign exchange derivative financial instruments | 3,854 | 2,333 | +65.2% | | Gross operating lease rental income from investment properties | 16,110 | 16,196 | -0.5% | | Government grants | 7,786 | 12,629 | -38.4% | | Sales of scrap materials | 29,549 | 15,071 | +96.1% | | Total | 203,208 | 201,000 | +1.1% | Compensation for the loss of inventories due to a fire accident The insurance company paid the remaining compensation for inventory losses due to a fire accident to the Group last year, amounting to approximately HKD 30 million - The insurance company paid approximately HKD 30 million in compensation for inventory losses last year[71][77] Gain from resumption of land and buildings During the year, a warehouse located in Guangzhou was resumed by the local government, and the Group recognized a net gain of HKD 89 million from the resumption of land and buildings - A net gain of HKD 89 million was recognized due to the resumption of a Guangzhou warehouse by the local government[72][78] Finance costs Finance costs increased by HKD 27 million to HKD 78 million, primarily due to an increase in interest-bearing bank borrowings in the second half of last year 2025 Fiscal Year Finance Costs | Item | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Finance costs | 78 | 51 | +52.9% | - The increase in finance costs is primarily attributable to the rise in interest-bearing bank borrowings in the second half of last year[73][79] Financial Condition The Group maintains a robust financial position, with a current ratio of 2.8 times and total interest-bearing bank borrowings of HKD 846 million. Through proactive inventory reduction strategies, inventory turnover days decreased from 105 to 81 days. The Group primarily meets its funding needs through operating cash inflows and interest-bearing bank borrowings 2025 Fiscal Year Key Financial Condition Metrics | Metric | 2025 | 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Current Ratio (times) | 2.8 | 3.0 | -6.7% | | Total Interest-bearing Bank Borrowings (HKD million) | 846 | 820 | +3.2% | | Gearing Ratio (times) | -0.2 | -0.2 | 0% | | Interest Coverage Ratio (times) | 2.4 | 5 | -52.0% | | Inventory to Turnover (days) | 81 | 105 | -22.9% | | Cash and Cash Equivalents (HKD million) | 1,633 | 1,555 | +5.0% | | Unutilized Bank Facilities (HKD million) | 6,020 | 6,399 | -5.9% | - Proactive inventory reduction strategies led to a decrease in inventory turnover days from 105 days to 81 days[75][80] - The Group primarily meets its funding needs through operating cash inflows and interest-bearing bank borrowings[75][80] Capital expenditure The Group's capital expenditure for the year was HKD 305 million, a year-on-year increase of 54.8%. Of this, HKD 290 million was spent on textile and garment businesses, primarily for additions to plant and machinery and coal-to-gas conversion projects; HKD 15 million was spent on retail and distribution businesses, mainly for leasehold improvements to retail stores 2025 Fiscal Year Capital Expenditure | Business Segment | 2025 (HKD million) | 2024 (HKD million) | Change Rate | | :--- | :--- | :--- | :--- | | Group Total | 305 | 197 | +54.8% | | Textile and Garment Business | 290 | 166 | +74.7% | | - Plant and machinery | 268 | 123 | +117.9% | | - Coal-to-gas conversion projects | 22 | 43 | -48.8% | | Retail and Distribution Business | 15 | 31 | -51.6% | Foreign exchange and interest rate risks The Group adopts a strict and prudent management policy for interest rate and foreign exchange risks. Major interest-bearing bank borrowings are denominated in HKD, USD, RMB, and VND, with forward foreign exchange contracts arranged to mitigate exchange rate risks. The Group will continue to monitor interest rate risks and arrange appropriate financial instruments for risk management - The Group's principal interest-bearing bank borrowings are fixed or floating rate loans denominated in HKD, USD, RMB, and VND, maturing within two years[84][89] - The Group has arranged forward foreign exchange contracts to mitigate its exchange rate risk, with major assets, liabilities, income, expenses, and purchases denominated in HKD, USD, RMB, VND, and IDR[85][90] Material Acquisition and Disposal This year, the Group had no other material acquisitions or disposals, but disclosed that Guangzhou Lingke Retail Technology Co., Ltd. entered into a resumption compensation agreement with Guangzhou Development Zone Key Project Promotion Center for the resumption of land and buildings, receiving RMB 98 million (approximately HKD 106 million) in compensation - Guangzhou Lingke Retail Technology Co., Ltd. received RMB 98 million (approximately HKD 106 million) in compensation due to the resumption of land and buildings[92][98] Human Resources As of year-end, the Group had approximately 9,799 employees across Greater China, Vietnam, and Indonesia, with employee remuneration primarily based on industry practice and individual performance 2025 Fiscal Year Employee Count | Region | 2025 | 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Hong Kong | 563 | 646 | -12.8% | | Mainland China | 7,582 | 8,174 | -7.2% | | Vietnam and Indonesia | 1,654 | 1,029 | +60.7% | | Total | 9,799 | 9,849 | -0.5% | - The Group's total employee count slightly decreased, but the number of employees in Vietnam and Indonesia significantly increased, reflecting the implementation of the 'China Plus One' strategy[12][94][100] Compliance with the Applicable Laws and Regulations The Group continuously ensures full compliance with applicable laws and regulations significantly impacting its operations, including those related to environmental protection, product safety, customer rights protection, employment, and occupational safety. Management will monitor changes in laws and regulations and seek external advice as needed - The Group complies with laws and regulations concerning environmental protection, product safety and liability, protection of customer rights, employment, and occupational safety[95][101] Environmental Policies and Performance The Group is committed to promoting environmental sustainability and has established environmental and energy management systems compliant with ISO 14001:2015 and ISO 50001:2018 international standards. This year, the Group complied with applicable environmental laws and regulations regarding wastewater, greenhouse gas emissions, and solid waste disposal. Further details will be disclosed in the 2025 ESG Report - The Group's textile production operations have established ISO 14001:2015 Environmental Management System and ISO 50001:2018 Energy Management System[97][103] - In fiscal year 2025, the Group complied with applicable environmental laws and regulations regarding wastewater, greenhouse gas emissions, and solid waste disposal[104][108] - Detailed information on relevant environmental policies and performance will be disclosed in the separate 2025 Environmental, Social and Governance Report[105][108] Corporate Social Responsibility The Group actively fulfills its corporate social responsibility by participating in charitable donations, caring for vulnerable groups, and supporting educational and environmental activities. This fiscal year, the Group participated in and sponsored various activities and organizations, including education funds, dragon boat races, scholarships, disaster relief aid, and several social service and environmental organizations - The Group actively participates in charitable and public welfare activities, cares for those in need, and supports and sponsors education and environmental initiatives[106][109] - Activities participated in/donated to/sponsored this fiscal year include the Guangdong Dongguan Education Fund, Dongguan Dragon Boat Race, Hunan Institute of Engineering Scholarship, Hanoi University of Science and Technology Scholarship in Vietnam, Hai Ha District Typhoon Disaster Relief Aid in Vietnam, and Hong Kong Community Chest 'Green Low Carbon Day'[111] Outlook The Group remains cautiously optimistic about the textile and retail markets, continuing to optimize its 'China Plus One' strategy, enhance the Vietnam factory's capability to produce high-value-added products, and advance digital transformation. Concurrently, the Group will strengthen product R&D, implement more energy-saving measures, and expand into overseas markets to diversify risks and seize opportunities. The Group is closely monitoring the US reciprocal tariff policy on major trading partners and prudently evaluating the Phase II expansion plan for its Vietnam factory - The Group will further optimize its production facilities in Dongguan and Vietnam, enhancing the Vietnam factory's capability to produce more complex, higher average selling price products[113][118] - Advance digital transformation initiatives to improve efficiency and save costs, and introduce more energy-saving measures and increase the proportion of renewable energy use[113][114][118] - Retail and distribution businesses will gradually restore profitability and expand into new regional markets, especially Southeast Asian markets, to diversify market presence[116][117][119] - The Group is closely monitoring the US reciprocal tariff policy implemented by the Trump administration on major trading partners, including China and Vietnam, and prudently evaluating the Phase II expansion plan for the Vietnam factory[115][118] Report of the Directors This report provides an overview of the Group's principal activities, business review, financial results, dividend policy, and corporate governance matters for the fiscal year Principal Activities This fiscal year, the Group's principal activities include the production, dyeing, and sale of knitted fabrics, cotton yarn, and garments; retail and distribution of casual wear and accessories; provision of franchising services; and property investment. The company's principal business is investment holding, with no significant change in the nature of its business - The Group's principal activities include the production, sale, and dyeing of knitted fabrics, cotton yarn, and garments, retail and distribution of casual wear and accessories, provision of franchising services, and property investment[122][129] - The Company's principal business is investment holding, with no significant change in the nature of its business this fiscal year[123][130] Business Review This section notes that further discussion and review of the Group's business activities, including principal risks, uncertainties, significant events after the financial year-end, future developments, analysis of key financial performance indicators, compliance with laws and regulations, environmental policies, and corporate social responsibility, have been elaborated in the Chairman's Statement and Management's Discussion and Analysis - The Group's business review, principal risks, future developments, financial performance, legal compliance, environmental policies, and corporate social responsibility are detailed in the Chairman's Statement (pages 6-8) and Management's Discussion and Analysis (pages 9-18)[124][130] Results and Dividends This section presents the Group's profit and financial position for the year ended March 31, 2025. The Board has paid interim and special interim dividends, and proposed final and special final dividends, totaling HKD 10.0 cents per ordinary share - An interim dividend of HKD 1.0 cent and a special interim dividend of HKD 3.0 cents per ordinary share have been paid[127][132] - The Board recommends a final dividend of HKD 1.0 cent and a special final dividend of HKD 5.0 cents per ordinary share[127][132] Dividend Policy The Board has adopted a dividend policy aimed at allowing shareholders to share in the Group's profits while retaining sufficient reserves for future development. The Group plans to distribute dividends semi-annually, subject to expected consolidated annual profit, and considering factors such as financial performance, retained earnings, distributable reserves, working capital requirements, capital expenditure, and future expansion plans - The Group's dividend policy aims to allow shareholders to share in profits while retaining sufficient reserves for future development[133][135] - Dividend distribution will consider factors such as the Group's financial performance, retained earnings, distributable reserves, anticipated working capital requirements, capital expenditure requirements, and future expansion plans[133][135] Summary Financial Information This section provides a summary of the Group's results, assets, liabilities, and non-controlling interests for the past five fiscal years, extracted from the audited financial statements and restated/reclassified as necessary Summary of Group Performance for the Past Five Years | Metric | 2025 (HKD thousand) | 2024 (HKD thousand) | 2023 (HKD thousand) | 2022 (HKD thousand) | 2021 (HKD thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 5,585,488 | 5,366,540 | 6,058,755 | 8,043,172 | 7,351,573 | | Profit Before Tax | 112,818 | 161,794 | 76,168 | 198,518 | 419,692 | | Profit for the Year | 116,942 | 138,946 | 63,101 | 186,709 | 273,959 | | Attributable to Ordinary Equity Holders of the Company | 116,068 | 132,334 | 75,149 | 191,064 | 274,213 | Summary of Group Assets, Liabilities and Non-controlling Interests for the Past Five Years | Metric | 2025 (HKD thousand) | 2024 (HKD thousand) | 2023 (HKD thousand) | 2022 (HKD thousand) | 2021 (HKD thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 6,887,651 | 7,108,158 | 6,946,622 | 8,977,748 | 8,740,394 | | Total Liabilities | (2,118,482) | (2,315,593) | (1,931,059) | (3,542,229) | (3,340,641) | | Non-controlling Interests | (5,022) | (4,372) | 10,248 | 1,855 | 251 | Property, Plant and Equipment, Investment Properties and Construction in Progress This section indicates that details of changes in the Group's property, plant and equipment, investment properties, and construction in progress during this fiscal year are presented in Notes 12, 13, and 15 to the financial statements - Details of changes in property, plant and equipment, investment properties, and construction in progress can be found in Notes 12, 13, and 15 to the financial statements[141][150] Share Capital There was no change in the company's share capital this fiscal year, with 1,381,696,104 issued and fully paid shares, each with a par value of HKD 0.05 2025 Fiscal Year Share Capital Information | Item | 2025 (HKD thousand) | 2024 (HKD thousand) | | :--- | :--- | :--- | | Authorised share capital (2,000,000,000 shares of HKD 0.05 each) | 100,000 | 100,000 | | Issued and fully paid share capital (1,381,696,104 shares of HKD 0.05 each) | 69,085 | 69,085 | - There was no change in the company's share capital this fiscal year[142][151] Pre-emptive Rights Neither the company's Bye-laws nor Bermuda law contains provisions for pre-emptive rights, not requiring the company to offer new shares pro-rata to existing shareholders - Neither the company's Bye-laws nor Bermuda law contains provisions for pre-emptive rights, not requiring the company to offer new shares pro-rata to existing shareholders[143][152] Purchase, Redemption or Sale of Listed Securities of the Company During this fiscal year, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities, and as of March 31, 2025, the company held no treasury shares - During this fiscal year, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities[144][153] - As of March 31, 2025, the company held no treasury shares[144][153] Reserves This section indicates that details of changes in the Group's reserves are presented in Note 39 to the financial statements and the consolidated statement of changes in equity. The Group's contributed surplus represents the difference between the par value of the company's share capital and the net assets of acquired subsidiaries, while the capital reserve represents the difference between the consideration and carrying amount of acquired non-controlling interests - Details of changes in the Group's reserves are presented in Note 39 to the financial statements and the consolidated statement of changes in equity[145][154] - Contributed surplus represents the difference between the par value of the Company's issued share capital and the par value of the issued share capital of the subsidiaries acquired at the date of acquisition during the Company's reorganization prior to its listing in 1992[153][877] - Capital reserve represents the difference between the consideration and the carrying amount of non-controlling interests acquired[153][880] Distributable Reserves As of March 31, 2025, the company's distributable reserves amounted to HKD 1,260,336,000. Additionally, the share premium account and capital redemption reserve, totaling HKD 705,060,000, are available for distribution as fully paid bonus shares 2025 Fiscal Year Distributable Reserves | Item | Amount (HKD thousand) | | :--- | :--- | | Reserves available for distribution in cash and/or in specie | 1,260,336 | | Share premium account and capital redemption reserve available for distribution as fully paid bonus shares | 705,060 | Charitable Contributions During this fiscal year, the Group's total charitable contributions amounted to HKD 582,000, a decrease from the previous year 2025 Fiscal Year Charitable Contributions | Year | Amount (HKD thousand) | | :--- | :--- | | 2025 | 582 | | 2024 | 639 | Major Customers and Suppliers This year, sales to the Group's five largest customers accounted for approximately 26% of total sales, and purchases from the five largest suppliers accounted for approximately 24% of total purchases. None of the company's directors, their associates, or shareholders holding more than 5% of the company's share capital had any beneficial interest in the five largest customers and suppliers - Sales to the Group's five largest customers accounted for approximately 26% of total annual sales[148][157] - Purchases from the Group's five largest suppliers accounted for approximately 24% of total annual purchases[148][157] - None of the company's directors, their associates, or shareholders holding more than 5% of the company's share capital had any beneficial interest in the five largest customers and suppliers[149][157] Permitted Indemnity Provision The company's Bye-laws stipulate that every director or other officer is entitled to be indemnified out of the company's assets against all losses or liabilities incurred or sustained in the course of their duties. The company has arranged appropriate directors' and officers' liability insurance - Company directors or other officers are entitled to be indemnified from company assets for all losses or liabilities incurred or sustained in the course of their duties[158][162] - The company has purchased appropriate directors' and officers' liability insurance[158][162] Directors This section lists the company's directors for this fiscal year and up to the report date. Dr. Chan Yuk Mau was appointed as an Independent Non-executive Director on May 15, 2025, and will stand for re-election at the 2025 Annual General Meeting. Mr. Cheng Shu Yung will not seek re-election and will retire after the meeting. Except for Dr. Chan and Mr. Cheng, all incumbent directors will retire and are eligible for re-election. All Independent Non-executive Directors are considered independent - Dr. Chan Yuk Mau was appointed as an Independent Non-executive Director on May 15, 2025, and will stand for re-election at the 2025 Annual General Meeting[159][163] - Mr. Cheng Shu Yung will not participate in the re-election at the 2025 Annual General Meeting and will retire as an Independent Non-executive Director after the meeting[160][164] - The company has received confirmations of independence from all Independent Non-executive Directors and considers them all independent[161][164] Directors' Service Contracts Service contracts with executive directors can be terminated by either party with not less than three months' written notice or payment in lieu of notice. Except as disclosed, the company has not entered into any service contracts with directors proposed for re-election that are not terminable within one year without payment of compensation other than statutory compensation - Service contracts with executive directors can be terminated by either party with not less than three months' written notice or payment in lieu of notice[166][172] - Except as disclosed, the company has not entered into any service contracts with directors proposed for re-election that are not terminable within one year without payment of compensation other than statutory compensation[167][172] Directors' Remuneration Directors' fees are subject to shareholders' approval at a general meeting. Other emoluments are determined by the Board based on directors' duties, responsibilities, performance, and the Group's results - Directors' fees are subject to approval by shareholders at a general meeting[168][173] - Other emoluments are determined by the Board based on the directors' duties, responsibilities, performance, and the Group's results[168][173] Directors' Interests in Transactions, Arrangements or Contracts Except as disclosed in Note 35 to the financial statements, no director or entity connected with a director had a direct or indirect material interest in any significant transaction, arrangement, or contract entered into by the company or any of its subsidiaries in the Group's business during this fiscal year - Except as disclosed in Note 35 to the financial statements, no director or entity connected with a director had a direct or indirect material interest in any significant transaction, arrangement, or contract in the Group's business during this fiscal year[169][174] Biographical Details of Directors and Senior Management This section provides detailed biographical information for Executive Directors (Poon Bun Chak, Ho Lai Hong, Poon Ho Tak, Ng Mo Ping) and Independent Non-executive Directors (Cheng Shu Yung, Lo Chung Nin, Lam Kit Yi, Chan Yuk Mau), as well as senior management (Chan Chi Hon, Wu Chi Hang), including their age, responsibilities, experience, and educational background - Mr. Poon Bun Chak is the Executive Chairman, founded the Group in 1975, and possesses over 50 years of experience in the textile industry[170][175] - Mr. Ho Lai Hong is the Chief Executive Officer, with over 30 years of experience in corporate banking, corporate finance, and management[171][175] - Mr. Ng Mo Ping was appointed as an Executive Director in April 2024, possessing over 35 years of experience in textile production and management[177][180] - Independent Non-executive Directors Ms. Lam Kit Yi and Dr. Chan Yuk Mau possess extensive experience and professional qualifications in their respective fields[182][183][184][185] Directors' Rights to Acquire Shares During this fiscal year, no director or their spouse or minor children were granted or exercised any rights to acquire benefits by purchasing shares of the company; nor did the company or any of its subsidiaries participate in any arrangements enabling directors to acquire such rights in any other body corporate - During this fiscal year, no director or their spouse or minor children were granted or exercised any rights to acquire shares[198][200] Substantial Shareholders' and Other Persons' Interests in Shares and Underlying Shares As of March 31, 2025, this section lists the interests and short positions of substantial shareholders and other persons holding 5% or more of the company's issued share capital, including entities controlled by Mr. Poon Bun Chak through a family trust and other institutional investors 2025 Fiscal Year Substantial Shareholders' Shareholding | Name | Capacity | Number of Ordinary Shares Held | Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Poon Bun Chak (through family trust) | Founder of a family trust | 698,830,104 | 50.58% | | UBS Trustees (B.V.I.) Limited | Trustee | 698,830,104 | 50.58% | | Poon's Holdings Limited | Through controlled corporations | 698,830,104 | 50.58% | | Farrow Star Limited | Directly owned | 698,830,104 | 50.58% | | Pandanus Associates Inc. | Through controlled corporations | 137,374,000 | 9.94% | | Pandanus Partners L.P. | Through controlled corporations | 137,374,000 | 9.94% | | FIL Limited | Through controlled corporations | 137,374,000 | 9.94% | | Fidelity Funds | Beneficial owner | 83,640,000 | 6.05% | | Brown Brothers Harriman & Co. | Approved lending agent | 72,558,800 | 5.25% | - Mr. Poon Bun Chak is deemed to be interested in 50.58% of the company's shares through a family trust[194][202][206] Connected Transactions and Continuing Connected Transactions The Group entered into several connected transactions and continuing connected transactions with companies controlled by Executive Chairman Mr. Poon Bun Chak, including leases for retail stores, a director's dormitory, and a training center. These transactions complied with Listing Rules requirements, were conducted on normal commercial terms, and were confirmed by Independent Non-executive Directors as fair and reasonable - The Group entered into several lease agreements with companies controlled by Executive Chairman Mr. Poon Bun Chak, including Tianjin Binjiang Fashion Plaza as a retail store, a property at 22 Perkins Road, Jardine's Lookout, Hong Kong as a director's dormitory, and Unit 4207B, 42/F, Tower 2, Metroplaza, Hong Kong as a training center[205][208][216] - Under HKFRS 16, fixed rentals for retail stores were recognized as right-of-use assets, with a total value of approximately HKD 27,000,000[212][215] - Variable rentals for retail stores are considered continuing connected transactions, with annual caps of HKD 800,000 for fiscal year 2025 and HKD 1,600,000 for fiscal year 2026[217][218][220](index=220