Financial Performance - The Group achieved a revenue growth of 6% to HK$2,791 million for the six months ended 31 December 2021, supported by increased sales volume and higher bran selling prices[11]. - Profit for the period decreased by 27% to HK$173 million due to pressured profit margins and the absence of government COVID-19 subsidies[11]. - The food segment's operating profit declined by 36% to HK$175 million despite a 6% increase in revenue[14]. - Gross profit for the same period was HK$626,225,000, down 14.4% from HK$731,677,000 in 2020[42]. - Total comprehensive income for the period was HK$208,624,000, down 45.9% from HK$385,185,000 in the same period of 2020[44]. - Reportable segment profit from operations decreased to HK$209,429,000 for the six months ended December 31, 2021, down 35.4% from HK$324,825,000 in 2020[71]. - Consolidated profit before taxation was HK$188,157,000, a decline of 36.0% compared to HK$294,097,000 in the previous year[72]. Revenue and Growth - For the six months ended December 31, 2021, the company reported revenue of HK$3,226,931,000, an increase of 5.7% from HK$3,051,295,000 in the same period of 2020[42]. - Revenue from contracts with customers for the six months ended December 31, 2021, was HK$3,226,931,000, an increase from HK$3,051,295,000 in the same period of 2020, representing a growth of approximately 5.75%[66]. - Revenue from external customers in the Food segment was HK$2,791,465,000, while the Home Care segment generated HK$435,466,000, contributing to the total revenue[68]. Cost and Profit Margins - Gross profit margin declined by 4.6 percentage points to 19.4%, significantly impacted by rising costs of wheat, edible oil, and detergent materials[11]. - The Edible Oil business faced challenges from unprecedented raw material cost increases and channel disruptions, prompting several rounds of price increases[21]. - The Group has implemented price increases and cost control strategies in response to unprecedented raw material cost surges in the edible oil business[23]. - The Home Care segment's revenue increased by 2% to HK$435 million, while operating profit declined by 33% to HK$34 million, reflecting high raw material costs and intense market competition[25][28]. Cash and Liquidity - As of 31 December 2021, the Group's cash balance was HK$1,481 million, with investments in fixed income government bonds and equity securities totaling HK$189 million[12]. - As of December 31, 2021, the Group had a cash balance of HK$1,481 million, with 72% in Renminbi, indicating strong liquidity[31]. - Cash and cash equivalents at December 31, 2021, amounted to HK$1,124,076,000, down from HK$1,145,484,000 at the end of 2020, indicating a decrease of approximately 2%[51]. - Net cash generated from operating activities for the six months ended December 31, 2021, was HK$157,268,000, compared to HK$153,149,000 for the same period in 2020, reflecting a slight increase of 2%[51]. Investments and Capital Expenditures - The company invested HK$62 million in capital expenditures during the six months ended December 31, 2021, up from HK$54 million in the previous year[36]. - The Group acquired property, plant, and equipment at a cost of HK$67,065,000 during the six months ended December 31, 2021, slightly down from HK$68,486,000 in 2020[91]. - The Group had capital commitments of HK$23,393,000 authorized and contracted as of December 31, 2021, down from HK$46,988,000 as of June 30, 2021, reflecting a decrease of approximately 50%[125]. Employee and Shareholder Information - The Group employs a share option scheme to retain and motivate its 1,687 employees as of December 31, 2021[37]. - The weighted average number of ordinary shares in issue during the interim period was 236,110,000, down from 236,734,000 in 2020[87]. - The Group purchased its own ordinary shares for a total of HK$12,736,000 during the six months ended December 31, 2021, compared to HK$9,530,000 in the same period of 2020[108]. - The interim dividend declared per ordinary share was HK$0.15, unchanged from the previous year, with total dividends payable amounting to HK$35,327,000 compared to HK$35,510,000 in 2020[84]. Market and Operational Challenges - The Group anticipates an upsurge in raw material costs and fluctuating market consumption patterns, maintaining a cautious but optimistic outlook[27][29]. - The Food segment's revenue showed steady growth, but gross margin adjusted due to rising wheat prices, with challenges from COVID-19 lockdowns and natural disasters impacting manufacturing and restaurant clients[22]. - The Group has adopted interactive online communications to strengthen customer relationships amid changing market dynamics due to COVID-19[19]. Financial Position and Assets - Current assets totaled HK$2,781,444,000, slightly up from HK$2,758,360,000 in the previous period[48]. - The company reported a net current asset position of HK$2,007,490,000, an increase from HK$1,980,576,000 as of June 30, 2021[48]. - The Group's total liabilities as of December 31, 2021, were HK$716,357,000, a slight decrease from HK$726,111,000 as of June 30, 2021[101]. Shareholder Interests and Corporate Governance - The directors of the Company held a total of 27,543,069 shares, representing approximately 11.32% of the total number of ordinary shares in issue as of December 31, 2021[131]. - GuoLine Capital Assets Limited and associated entities held 156,114,659 shares, representing approximately 64.15% of the company's total shares[146]. - The interests of substantial shareholders included 140,008,659 ordinary shares held by GuoLine International Limited and 6,781,000 ordinary shares held by Richly Choice Development (PTC) Limited[147].
南顺(香港)(00411) - 2022 - 中期财报