EMPEROR WATCH&J(HK:00887)2022-04-21 10:09Financial Performance - The Group's total revenue increased by 49.5% to HK$3,926.6 million for the year ended December 31, 2021, compared to HK$2,626.6 million in 2020[25]. - Revenue from the mainland China market rose by 56.7% to HK$1,227.8 million, accounting for 31.3% of total revenue[29]. - Revenue from the Hong Kong market increased by 38.4% to HK$1,739.3 million, representing 44.3% of total revenue[29]. - Gross profit for the year was HK$1,230 million, up 46.4% from HK$840 million in 2020[25]. - Adjusted EBITD increased by 128.1% to HK$365 million, compared to HK$160 million in the previous year[25]. - Net profit surged by 502.9% to HK$205 million, up from HK$34 million in 2020[25]. - Basic earnings per share rose to HK3.02 cents, a 504.0% increase from HK0.50 cent in 2020[25]. - Final dividend per share increased by 133.3% to HK0.35 cent from HK0.15 cent in the previous year[25]. - Sales revenue from the watch segment reached HK$3,268.9 million, accounting for 83.3% of total revenue[29]. - Sales revenue from the jewellery segment increased to HK$657.7 million, representing 16.7% of total revenue[29]. - Gross profit increased to HK$1,229.5 million, up from HK$840.1 million in 2020, with a gross profit margin of 31.3%[30]. - Net profit surged 502.9% to HK$204.7 million, compared to HK$34.0 million in 2020, with basic earnings per share at HK3.02 cents[30]. - Total revenue increased by 49.5% to HK$3,926.6 million, up from HK$2,626.6 million in 2020[31]. Dividends and Reserves - The total dividends for the Year are HK0.9 cent per share, compared to HK0.15 cent per share in 2020[32]. - The Group paid an interim dividend of HK$0.55 per share, totaling approximately HK$37.3 million for the Year[98]. - The Directors recommended a final dividend of HK$0.35 per share, an increase from HK$0.15 per share in 2020[99]. - The Company's distributable reserves as of December 31, 2021, amounted to HK$1,175.76 million, an increase from HK$1,059.07 million in 2020[108]. Operational Highlights - The Group opened one jewellery store in Hong Kong and six stores in mainland China during the Year[49]. - The Group maintains a retail network of approximately 99 stores across multiple regions, including 55 in mainland China[44]. - Over 70% of the Group's stores in mainland China are located in first-tier and new first-tier cities[46]. - The Group actively participates in co-marketing campaigns with major luxury Swiss watch brands to enhance customer engagement[50]. - The Group plans to enhance its retail network in mainland China through cautious expansion, anticipating it to be a key driver of business growth[59]. - The Group will continue to monitor market trends and consumer behavior to adjust strategies accordingly, maintaining healthy inventory levels[60]. Financial Position - As of December 31, 2021, the Group's bank balances and cash increased to HK$556.3 million, up from HK$405.1 million in 2020[63]. - The Group's total bank borrowings decreased to approximately HK$165.5 million in 2021, down from HK$638.7 million in 2020, resulting in a net cash position with a net gearing ratio of zero[63]. - Current assets were approximately HK$3,435.6 million and current liabilities were HK$535.4 million, leading to a current ratio of 6.4, significantly improved from 3.5 in 2020[64]. Human Resources - Total staff costs for the year amounted to HK$288.5 million, an increase from HK$192.2 million in 2020, reflecting the Group's investment in human resources[68]. - The Group's employee count as of December 31, 2021, was 857, a slight decrease from 865 in 2020, indicating a focus on efficiency[68]. Market Trends and Strategies - The luxury market has been recovering, but local Omicron cases have led to tightened social distancing measures, impacting market sentiment and recovery[58]. - The company provided a positive outlook for the next fiscal year, projecting a revenue growth of 10% to 12% driven by new product launches and market expansion strategies[79]. - New product development initiatives are underway, focusing on innovative designs and sustainable materials to attract a broader customer base[79]. - Market expansion efforts include entering new geographical regions, particularly in Southeast Asia, aiming for a 25% increase in market share within the next two years[79]. - The company has invested HKD 50 million in technology upgrades to improve operational efficiency and customer experience[79]. - A new marketing strategy has been implemented, focusing on digital channels, which is expected to increase brand visibility and customer acquisition by 30%[79]. - The management team emphasized the importance of corporate governance and sustainability practices in future business operations[79]. Shareholding and Governance - As of December 31, 2021, the interests of directors and chief executives in the company's shares amounted to 4,298,610,000 shares, representing 63.41% of the issued voting shares[134]. - Ms. Cindy Yeung holds a deemed interest in 2,747,610,489 shares of Emperor International, which is 74.71% of the issued voting shares[142]. - The company has not granted, exercised, canceled, or allowed any options under the Share Option Scheme since its adoption on May 23, 2018[170]. - The company maintains indemnity provisions for potential liabilities and costs arising from legal proceedings faced by its directors[131]. - The company has no outstanding management contracts related to the management and operation of its business[130]. - The Group's five largest customers accounted for approximately 2.4% of total turnover, down from 3.6% in 2020[113]. - The Group's five largest suppliers contributed approximately 96.3% of total purchases, slightly up from 95.9% in 2020[113].