Revenue and Sales Performance - The Group's revenue from Hong Kong accounted for approximately 59%, with retail sales of wearing apparel dropping by about 10.6% to approximately HK$37.91 billion in 2024, contrasting sharply with a growth of about 43.5% in 2023[16][19]. - The total visitor arrivals in Hong Kong in 2024 rebounded to only about 79.59% of the pre-pandemic level in 2019, indicating that the supporting customer base has not yet recovered[19]. - Retail sales in Hong Kong experienced a year-on-year decline for thirteen consecutive months from March 2024 to March 2025, highlighting ongoing economic challenges[19]. - In Mainland China, the growth rate of retail sales for apparel, shoes, headwear, and knitted products slowed to 0.3% in 2024 from 12.9% in 2023, reflecting a deteriorating economic environment[21][22]. - The Group recorded an operating loss of approximately HK$46 million due to a 25% decline in turnover, with revenue from Hong Kong falling by 27% to approximately HK$61 million[27]. - Revenue from Mainland China decreased by 20% to approximately HK$25 million, while revenue from Macau dropped by 15% to approximately HK$10 million, and revenue from Taiwan decreased by 35% to approximately HK$7 million[27]. - The Group's revenue from operations in Hong Kong decreased by 27% to HK$61,005,000 due to economic downturns and changes in consumer behavior[54]. - The Group's turnover decreased by approximately 25% to approximately HK$102,722,000 for the year ended 31 March 2025, compared to HK$137,311,000 in 2024[83]. Operational Strategies and Adaptations - The company is adapting to fundamental trends in the industry, including the emergence of a younger generation of consumers who prioritize functionality and personal style over brand names[21][23]. - The Group is focusing on building its major house brand MOISELLE and enhancing customer relationships through online and offline marketing campaigns[32]. - The Group is rationalizing its retail networks, maintaining one store in each city in Mainland China, and expanding its retail presence in prime locations in Hong Kong[37]. - The Group is actively negotiating with landlords to lower shop rents in response to high rental pressures, with limited success in the first half of the Year[37]. - The Group is conducting more short-term promotional sales throughout the year to adapt to changes in consumer behavior, moving beyond reliance on public holidays[36]. - The Group is focusing on enhancing operational efficiency by increasing automation in apparel processing[47]. - The Group aims to maintain a competitive edge by regularly updating product displays and store decorations across all retail outlets[46]. - The Group is actively seeking to rationalize its retail network while exploring new locations with business potential[56]. Marketing and Customer Engagement - The Group is leveraging information technologies, such as e-commerce and social media, to promote and sell products effectively[23]. - The Group continues to enhance its electronic commerce business through alliances with local operators such as VIP.com, Tmall, and JD.com[40]. - The Group is leveraging social media for marketing campaigns to engage existing and potential customers[45]. - The Group hosted fashion shows and marketing campaigns to strengthen relationships with existing customers and attract new ones[68]. - The Group continued short-term cooperation with OnTheList, an online shopping website operator specializing in flash sales, to boost sales[67]. - A customer loyalty program has been implemented to enhance customer satisfaction, offering VIP customers special discounts and regular activities[108]. Financial Health and Governance - The gross profit margin for the Year was 80%, down from 81% in the previous financial year[28]. - Operating expenses decreased by approximately 6% to approximately HK$133,443,000, but the Group still recorded an operating loss of HK$45,811,000[85]. - The loss attributable to equity shareholders increased to approximately HK$56,546,000, up from HK$48,100,000 in 2024[86]. - As of 31 March 2025, the Group's cash and fixed deposits totaled approximately HK$5 million, down from HK$24 million in 2024[91]. - The Group's net current liabilities increased to HK$67 million, compared to HK$24 million in 2024[93]. - The gearing ratio as of 31 March 2025 was approximately 31.1%, up from 23.5% in 2024[93]. - The Group employed 271 employees as of 31 March 2025, down from 302 in 2024[98]. Corporate Governance and Management - The company emphasizes adherence to corporate governance principles, focusing on transparency, independence, accountability, responsibility, and fairness[142]. - The company has complied with the Corporate Governance Code throughout the year ended March 31, 2025, except for the separation of the roles of chairman and CEO[143]. - The current management structure is believed to ensure consistent leadership and optimal efficiency for the company's operations[144]. - The board is responsible for providing leadership and monitoring, formulating business strategies, and assessing risks to achieve the company's goals[146]. - The company has strengthened its corporate values, emphasizing ethical and responsible business practices[146]. - The board has established the company's purpose and values, aligning them with an ideal culture[146]. - The Board consists of seven directors, including three executive directors and four independent non-executive directors[148]. - The company has a nomination committee responsible for reviewing board structure and making recommendations on director appointments[166][167]. - The board diversity policy includes measurable objectives and is reviewed annually by the nomination committee[169]. - The company emphasizes conducting business in a lawful, ethical, and responsible manner, aligning corporate values with desired culture[149]. Risk Management and Compliance - The board is responsible for maintaining effective risk management and internal control systems, which are essential for the group's operations[192]. - The board conducted an annual review of the effectiveness of the risk management and internal control systems based on the COSO framework[196]. - The internal audit department reviewed continuing connected transactions and included findings in its annual review report submitted to the board[198]. - The group has established a whistleblowing policy and system for employees, clients, and suppliers to raise concerns confidentially and anonymously[199].
慕诗国际(00130) - 2025 - 年度财报