TEXWINCA HOLD(HK:00321)2022-07-18 10:44Financial Performance - The turnover for 2022 was HK$8,043 million, an increase of 9.4% from HK$7,352 million in 2021[8]. - Profit attributable to ordinary equity holders decreased to HK$191 million, down 30.3% from HK$274 million in 2021[8]. - Total equity increased slightly to HK$5,436 million from HK$5,400 million in 2021[8]. - Total assets rose to HK$8,978 million, compared to HK$8,740 million in 2021[8]. - EBITDA for the year was HK$671 million, down from HK$903 million in 2021[8]. - Basic earnings per share decreased to HK$13.8 cents from HK$19.8 cents in 2021[8]. - The Group's gross profit margin was 29.0%, a decrease of 2.0 percentage points from 31.0% in the previous year[14]. - Operating profit for 2022 was HK$564 million, slightly down from HK$567 million in 2021[19]. - Profit before tax decreased to HK$198,518,000 from HK$419,692,000 in the previous year, reflecting a decline of about 52.7%[60]. - Profit for the year attributable to ordinary equity holders of the Company was HK$191,064,000, down from HK$274,213,000 in 2021, a decrease of approximately 30.3%[60]. Dividends - Dividends per share increased to HK$18.0 cents, up from HK$15.0 cents in 2021[8]. - The dividend yield for 2022 was 12.3%, compared to 8.4% in 2021[8]. - A final dividend of HK10.0 cents per share was declared, maintaining the same level as in 2021, with a total dividend of HK18.0 cents for the year, an increase of 20.0% from HK15.0 cents in 2021[15]. - An interim dividend of HK8.0 cents per ordinary share was paid on January 14, 2022, with a recommended final dividend of HK10.0 cents per ordinary share[54]. Operational Highlights - The textile business turnover increased by 19.4% to HK$5,544 million, representing 68.9% of the Group's total revenue[16]. - Retail and distribution business sales were HK$2,496 million, down 7.7% from HK$2,705 million in 2021, accounting for 31.0% of total turnover[22]. - In Mainland China, net sales decreased by 11% to HK$1,936 million in 2022 from HK$2,184 million in 2021[31]. - The number of outlets in Mainland China decreased to 1,666 in 2022 from 2,026 in 2021[31]. - The Group's online e-commerce sales contributed to the retail and distribution business, resulting in satisfactory profitability during the year[51]. Challenges and Strategic Focus - The operating environment remained challenging due to the COVID-19 pandemic, impacting retail consumption in Mainland China and Hong Kong[12]. - The Group is focusing on cost reduction to enhance operating profitability amid rising energy and raw material prices due to high inflation[16]. - The Group has downsized its Mainland China operations until there are positive signs of economic recovery[12]. - The business environment remains challenging due to the ongoing COVID-19 pandemic and strict preventive measures affecting retail and distribution[51]. Financial Position and Ratios - The current ratio for 2022 was 2.1, a decrease from 2.2 in 2021[8]. - Return on total assets improved to 7.5% in 2022 from 6.1% in 2021[19]. - Return on equity increased to 11.4% in 2022 from 9.1% in 2021[19]. - The current ratio at year-end was 2.1, with total bank borrowings of HK$1,308 million and a gearing ratio of -0.2[36]. - The interest cover ratio was 7 times, down from 15 times in 2021, indicating a decrease in financial leverage[36]. Capital Expenditure - Capital expenditure for 2022 was HK$251 million, significantly higher than HK$126 million in 2021[19]. - Capital expenditure for 2022 was HK$300 million, an increase from HK$183 million in 2021, with HK$251 million allocated to the textile and garment business[36]. Environmental and Social Responsibility - The Group is committed to environmental sustainability, having established environmental and energy management systems in accordance with ISO 14001:2015 and ISO 50001:2011 standards[40]. - During the year ended March 31, 2022, the Group complied with applicable environmental protection laws regarding wastewater, greenhouse gas emissions, and solid waste from textile manufacturing operations[42]. - Charitable contributions made by the Group during the year totaled HK$521,000, a significant decrease from HK$2,465,000 in 2021[64]. Governance and Management - The Group's management team includes individuals with diverse backgrounds and significant industry experience, enhancing its operational capabilities[84]. - The Company has established three board committees: Audit, Remuneration, and Nomination, to oversee various aspects of governance[136]. - The Board is responsible for the Group's risk management and internal control systems, which are designed to mitigate inherent business risks to an acceptable level[167]. - The Company has adopted a whistleblowing policy to allow employees and stakeholders to report misconduct confidentially[177]. Shareholder Engagement - The Company ensures effective communication with shareholders through annual general meetings and corporate information dissemination[190]. - The AGM notice is distributed at least 20 business days prior, detailing proposed resolutions[192]. - Voting results from the AGM are posted on the Company's and Stock Exchange's websites on the same day[192]. - The Group emphasizes the importance of shareholder feedback to enhance transparency and investor relations[194].