Financial Performance - For the six months ended June 30, 2022, the Group recorded total revenue of HK$329.0 million, a decrease of HK$32.3 million or 8.9% from HK$361.3 million for the same period in 2021[42]. - Revenue from the beverage solutions segment decreased by HK$31.2 million or 8.8% to HK$321.7 million, primarily due to a decline in revenue from Hong Kong and Mainland China[42]. - The Group's profit for the period decreased by HK$17.3 million, or 45.2%, from HK$38.3 million for the six months ended June 30, 2021, to HK$21.0 million for the six months ended June 30, 2022[76]. - Profit before tax decreased to HK$26,188,000, a decline of 46.0% from HK$48,473,000 in the previous year[130]. - Profit for the period attributable to owners of the parent was HK$21,027,000, compared to HK$38,306,000 in the prior year, representing a 45.0% decrease[130]. - Total comprehensive income for the period was HK$9,292,000, significantly lower than HK$40,340,000 in the previous year[134]. Gross Profit and Margins - Gross profit margin decreased from 40.4% for the six months ended June 30, 2021, to 34.3% for the same period in 2022[42]. - The Group's gross profit decreased by HK$33.2 million, or 22.8%, from HK$145.9 million for the six months ended June 30, 2021, to HK$112.7 million for the six months ended June 30, 2022[57]. - Gross profit for the same period was HK$112,652,000, down from HK$145,879,000, reflecting a gross profit margin decrease[130]. Expenses and Cost Management - Selling and distribution expenses decreased by HK$10.9 million, or 19.2%, from HK$56.8 million for the six months ended June 30, 2021, to HK$45.9 million for the six months ended June 30, 2022[63]. - Administrative expenses increased by HK$2.5 million, or 6.4%, from HK$39.3 million for the six months ended June 30, 2021, to HK$41.8 million for the six months ended June 30, 2022[64]. - The cost of sales for the six months was HK$216,331,000, slightly higher than HK$215,409,000 in the same period last year[130]. Market Conditions and Recovery - The Group's business began to recover in May 2022, with sales and profit margins showing an upward trend despite adverse market conditions[46]. - The ongoing COVID-19 pandemic continues to impact the Group's performance, particularly due to lockdowns in various cities in China[45]. - The decrease in revenue was primarily due to a decline in sales volume of coffee, tea, and milk products, attributed to the fifth wave of COVID-19 in Hong Kong and lockdown measures in Mainland China[55]. Operational Enhancements - The Group plans to enhance operational capabilities in marketing, sales, and supply chain to support its development plan in China[50]. - The Group has upgraded its SAP system to improve CRM and market assessment capabilities, allowing for better adaptation to market changes[49]. - Online sales in Hong Kong experienced steady growth, and B2C sales regained momentum compared to the previous year[49]. Financial Position and Liquidity - Cash and cash equivalents stood at HK$232.7 million as of June 30, 2022, indicating a robust financial position to support operations and foreseeable capital expenditures[85]. - The Group's net current assets decreased by HK$52.0 million to HK$375.5 million as of June 30, 2022, down from HK$427.5 million as of December 31, 2021[84]. - The Group's total interest-bearing bank borrowings increased to HK$12.3 million as of June 30, 2022, compared to HK$3.2 million as of December 31, 2021[83]. - The Group's gearing ratio rose to 2.1% as of June 30, 2022, up from 0.5% as of December 31, 2021, primarily due to an increase in outstanding interest-bearing bank borrowings[96]. - The Group's liquidity management includes maintaining a cash pooling system to ensure adequate funds for short and long-term liquidity requirements[110]. Capital Expenditures and Commitments - Capital expenditures amounted to HK$51.7 million during the six months ended June 30, 2022, compared to HK$17.0 million for the same period in 2021[77]. - As of June 30, 2022, the Group had capital commitments of HK$17.1 million, primarily related to contracts for capital expenditure in production machinery[78]. - The company has no concrete plans for material investments or capital assets for the forthcoming year[86]. Employee and Workforce Changes - The Group employed 193 and 227 employees in Hong Kong and the PRC, respectively, as of June 30, 2022, compared to 207 and 235 employees as of December 31, 2021[111]. Foreign Currency and Exchange Management - The Group is closely monitoring foreign currency exposures, primarily arising from transactions in currencies other than the functional currencies[102]. - The company reported an exchange loss of HK$11,735,000 due to translation of foreign operations[134].
捷荣国际控股(02119) - 2022 - 中期财报