Financial Performance - For the fiscal year ended December 31, 2022, the company's revenue decreased to HKD 245.2 million from HKD 363.0 million in 2021, representing a decline of approximately 32.5%[19] - Gross profit for the same period was HKD 18.9 million, down from HKD 65.4 million in 2021, resulting in a gross margin of 7.7% compared to 18.0% in the previous year[19] - The company reported a pre-tax loss of HKD 55.1 million, significantly higher than the pre-tax loss of HKD 12.0 million in 2021[12] - Operating cash flow before changes in working capital was negative HKD 36.2 million, compared to positive HKD 7.5 million in the previous year[9] - The company reported a total loss and comprehensive expenses of HKD 49.962 million for the year[42] - The company's available distributable reserves as of December 31, 2022, amounted to approximately HKD 118,941,000[66] - The net asset value of the company decreased to HKD 313,472,000 in 2022 from HKD 363,434,000 in 2021, a decline of 13.8%[71] - The company's total equity attributable to owners remained stable at HKD 313,472,000 in 2022, unchanged from the previous year[71] - The company did not declare any dividends for the year, indicating a focus on retaining earnings[63] Assets and Liabilities - Cash and cash equivalents decreased from HKD 119.9 million in 2021 to HKD 84.7 million in 2022[21] - As of December 31, 2022, the company's current assets net value was approximately HKD 162.5 million, down from HKD 225.9 million in 2021[53] - Non-current liabilities increased to HKD 12,528,000 in 2022 from HKD 10,399,000 in 2021, representing a growth of 10.9%[71] - The company's capital and reserves showed a decrease in retained earnings from HKD 216,073,000 in 2021 to HKD 216,073,000 in 2022, indicating no growth in this area[80] - The company reported a total of HKD 1,165,000 in other payables, down from HKD 1,704,000 in the previous year, a decrease of 31.6%[71] - The company’s lease liabilities increased significantly to HKD 3,431,000 in 2022 from HKD 540,000 in 2021, marking a substantial rise of 535.4%[71] - Deferred tax liabilities decreased slightly to HKD 7,932,000 in 2022 from HKD 8,155,000 in 2021, a reduction of 2.8%[71] - Current assets decreased significantly to HKD 230,869 million in 2022 from HKD 356,126 million in 2021, a decline of 35.1%[104] - Total current liabilities decreased to HKD 68,417 million in 2022 from HKD 130,179 million in 2021, a reduction of 47.5%[104] - The total asset value minus current liabilities stands at HKD 326,000 million, compared to HKD 373,833 million in 2021, a decline of 12.8%[104] Operational Challenges and Future Outlook - The company faced significant operational challenges due to the COVID-19 lockdowns in Shanghai, impacting production capacity and order volumes[19] - The company plans to continue developing new products using existing yarn inventory to meet the increasing demand for sustainable materials from brand owners[20] - The company anticipates a gradual recovery in global economic conditions, leading to increased production due to higher customer orders[23] - The company expects steady sales recovery as 2023 progresses, with projections indicating the global denim market could reach USD 87.4 billion by 2027[49] - The company continues to review opportunities to enhance overall performance amidst a challenging economic environment[22] Corporate Governance and Compliance - The board of directors has not approved any contracts for overall business management or significant administrative work during the year[122] - The company continues to comply with public shareholding requirements as stipulated by listing rules[123] - The board of directors consists of two executive directors, one non-executive director, and three independent non-executive directors, ensuring independent oversight[129] - The independent non-executive directors have confirmed compliance with the non-competition agreement established in the company's prospectus published on June 28, 2018[143] - The audit committee is composed of three independent non-executive directors, with a chairman possessing professional qualifications and experience in accounting and finance[162] - The company has established three board committees: the audit committee, the remuneration committee, and the nomination committee, each with clear written terms of reference[161] - The consolidated financial statements for the year ended December 31, 2022, were audited by Deloitte, who will be re-elected at the upcoming annual general meeting[148] - The company has complied with relevant laws and regulations in Hong Kong and China throughout the year[139] - The board confirmed that the risk management and internal control systems are adequate and effective, ensuring compliance with corporate governance codes[174] Management and Development - The company is focused on research and development to seize significant market opportunities for sustainable long-term growth[23] - The company plans to leverage its technological advantages and market position to expand its business further[23] - The company encourages all directors to participate in continuous professional development to enhance their knowledge and skills[157] - The board meets at least four times a year to discuss significant events and issues, ensuring timely communication of the group's latest developments[152] - The board retains final decision-making authority on significant matters, including policies, strategies, and major transactions[179] - The external auditor participated in discussions regarding audit, internal control, and financial reporting matters[189] - The board's leadership and management responsibilities are delegated to the management team for daily operations and strategy execution[177] - The audit committee reviews the group's risk management and internal control systems biannually to ensure they are adequate and effective, covering all significant control activities[200] - The board identified significant risks to the group this year and developed corresponding risk management solutions based on the group's risk tolerance[200]
兴纺控股(01968) - 2022 - 年度财报