Financial Performance - The company recorded total revenue of approximately HKD 140.1 million for the period, a decrease from HKD 177.5 million in the previous fiscal year, representing a decline of about 21%[36]. - Revenue from department store operations was approximately HKD 139.2 million, accounting for 99.4% of total revenue, compared to 99.6% in the previous year[37]. - Other income and net gains amounted to approximately HKD 12.7 million, significantly up from HKD 2 million in the previous year, primarily due to interest income from receivables of HKD 9.3 million[38]. - The company reported a net loss of approximately HKD 77.1 million for the period, compared to a net loss of HKD 145.7 million in the previous year, indicating an improvement[36]. - The company reported a loss attributable to equity holders of approximately HKD 75.9 million for the period, compared to a loss of HKD 145 million for the year ended February 28, 2021[46]. - The department store business generated revenue of approximately HKD 139.2 million during the period, down from HKD 176.7 million for the year ended February 28, 2021[47]. - The overall segment loss for the department store business was approximately HKD 63.2 million, compared to a loss of HKD 108.5 million for the year ended February 28, 2021[47]. Expenses and Costs - Selling and distribution expenses were approximately HKD 80.3 million, down from HKD 111.2 million in the previous year, a reduction of about 28%[39]. - General and administrative expenses decreased to approximately HKD 49.3 million from HKD 78.7 million, a decline of about 37%[43]. - Financial costs increased to approximately HKD 25.7 million from HKD 20.3 million, representing an increase of about 27%[45]. - The management is taking measures to improve profitability and control operating costs, including renegotiating rent and optimizing capital expenditures[60]. Cash Flow and Financial Position - As of December 31, 2021, the group's cash and bank balances were approximately HKD 156.2 million, down from HKD 191.7 million on February 28, 2021[55]. - The group's debt ratio was approximately 169% as of December 31, 2021, significantly improved from 1,514% on February 28, 2021[55]. - The group had a current ratio of approximately 0.58 as of December 31, 2021, compared to 0.53 on February 28, 2021[55]. - The group has reviewed cash flow forecasts covering a period of at least 12 months from December 31, 2021, considering key assumptions related to operational income and the impact of COVID-19[126]. - The group has no distributable reserves as of December 31, 2021[170]. Corporate Governance - The company changed its fiscal year-end from February 28/29 to December 31 to align with its controlling shareholder, which may enhance the preparation of consolidated financial statements[34]. - The board of directors consists of seven members, including three executive directors, one non-executive director, and three independent non-executive directors[81]. - The board held thirteen meetings and two shareholder meetings during the reporting period, with all executive directors attending all meetings[85]. - The company has complied with the corporate governance code, except for deviations noted in the corporate governance report[79]. - The company has adopted the standard code for securities transactions by directors, confirming compliance by all directors during the reporting period[80]. - The company has received annual independence confirmations from all independent non-executive directors, affirming their independence during the reporting period[90]. - The audit committee has reviewed the audited financial statements for the period[102]. - The company has implemented a comprehensive onboarding process for new directors to ensure they understand their responsibilities and the company's operations[98]. - The Audit Committee held four meetings during the period to review financial reporting and compliance processes, internal controls, and risk management systems[104]. - The Remuneration Committee conducted two meetings to review the company's remuneration policies and executive directors' compensation, ensuring transparency in the process[111]. - The Nomination Committee held two meetings to assess the board's structure and the independence of non-executive directors[120]. - The Executive Committee was established to assist the board in managing the group's daily operations and held one meeting during the period[120]. - The company adopted a board diversity policy, considering factors such as gender, age, cultural background, and professional experience to enhance performance[124]. - The company emphasizes the importance of board member diversity for improving overall performance[124]. - The board is responsible for ensuring that the financial statements are prepared in accordance with regulatory requirements and applicable accounting standards[126]. - The board conducted an annual review of the risk management and internal control systems, ensuring adequate resources and training for financial reporting functions[133]. - There were no significant internal deficiencies identified during the internal control audit and risk assessment conducted during the period[137]. - The group maintains a risk register to track identified major risks and actions taken to mitigate them, with evaluations conducted at least annually[137]. Shareholder Information - Wei Lu has become the controlling shareholder of the company after receiving valid acceptances for a total of 1,044,695,362 shares, representing approximately 79.51% of the company's total issued share capital[73]. - The major shareholder, Wealth Group Holdings Limited, is the beneficial owner of the 985,471,362 shares, with a legal interest held by Merrill Holdings Limited at approximately 62.73%[185]. - As of December 31, 2021, the company had a total of 985,471,362 shares held by major shareholders, representing approximately 75.00% of the issued share capital[181][185]. - As of the offer deadline, 269,267,198 shares, equivalent to about 20.49% of the company's issued share capital, were held by the public, which is below the minimum public float requirement of 25%[199]. - To restore the public float to 25%, Wealth Group would need to sell at least 59,223,442 shares, and a temporary waiver was granted by the Stock Exchange for strict compliance with the public float requirement[199]. - Following a placement agreement, the number of shares held by Wealth Group decreased from 1,044,695,362 to 985,471,362, reducing its holding from approximately 79.51% to 75.00%[199]. Compliance and Risk Management - The company confirmed compliance with the disclosure requirements under the Listing Rules regarding related party transactions, with all transactions being exempt from the announcement and independent shareholder approval requirements[192]. - The group continuously updates compliance and risk management policies to adhere to significant legal and regulatory requirements[156]. - The group reported a loss during the period, with financial status detailed in the audited financial statements on pages 60 to 168[162]. - The company does not recommend the payment of dividends for the period[63]. - The board does not recommend any dividend payment for the period[165]. - The company does not have a fixed dividend payout ratio, and the amount of dividends declared will depend on financial performance, cash position, and other factors[132]. Customer Relations and Business Operations - The company continues to focus on providing quality service and a diverse range of products to meet customer needs, maintaining its position as a leading retailer[29]. - The company has adopted a prudent strategy for business expansion to sustain its leadership in the retail sector[30]. - The group maintains good relationships with major stakeholders, including employees, customers, and suppliers, which are crucial for business success[159]. - The group has established a customer complaint handling mechanism to enhance service quality[161]. - The five largest customers accounted for less than 30% of the group's sales during the period[171]. - The main business activities of the group include operating department stores, securities trading, and providing general and life insurance[152]. - The business review discusses major risks and uncertainties faced by the group and anticipated future developments, forming part of the board report[153].
先施(00244) - 2021 - 年度财报