Financial Performance - For the year ended December 31, 2021, the Group recorded total revenue of approximately HK$20,258,000, representing a decrease of approximately HK$472,000 or 2.3% compared to HK$20,730,000 in 2020[15]. - Revenue from the Mobile Games and Applications Business decreased by approximately HK$282,000, with segment revenue of approximately HK$45,000 for the year ended December 31, 2021, down from approximately HK$327,000 in 2020[16]. - The Software Platform Business recorded a slight decrease in revenue of approximately HK$190,000, totaling approximately HK$20,213,000 for the year ended December 31, 2021, compared to approximately HK$20,403,000 in 2020[17]. - The Group's gross profit for the year ended December 31, 2021, decreased by approximately 7.3% to approximately HK$8,369,000 compared to approximately HK$9,031,000 in 2020[22][28]. - The consolidated net loss attributable to owners of the Company for the year ended December 31, 2021, was approximately HK$83,337,000, representing an increase of approximately 16.4% compared to approximately HK$71,611,000 in 2020[27][32]. - The loss from discontinued operations for the year ended December 31, 2021, was approximately HK$77,009,000, a significant increase of approximately HK$68,564,000 compared to approximately HK$8,445,000 in 2020, mainly due to decreased revenue and increased impairment losses[26][31]. Cost and Expenses - The Group's cost of sales for the year ended December 31, 2021, amounted to approximately HK$11,889,000, representing a slight increase of 1.6% from approximately HK$11,699,000 in 2020[18]. - Administrative and other operating expenses for the year ended December 31, 2021, amounted to approximately HK$28,315,000, a significant decrease from approximately HK$56,329,000 in 2020, primarily due to reduced impairment losses and staff costs[23][29]. - Finance costs for the year ended December 31, 2021, were approximately HK$1,456,000, down from approximately HK$1,828,000 in 2020[24][30]. Business Strategy and Outlook - The Group's financial performance reflects challenges in the gaming sector, necessitating strategic adjustments to enhance revenue streams[15]. - The decrease in revenue highlights the need for innovation and market expansion strategies to revitalize the Mobile Games and Applications Business[16]. - The Group's management is focused on developing new technologies and products to improve competitive positioning in the market[16]. - Future outlook includes ongoing development of new mobile games and potential enhancements in software platform services to drive growth[16]. - The existing mobile games are approaching the end of their life-cycles, resulting in low segment revenue for the year ended December 31, 2021[16]. - New mobile games are still under development, indicating potential future revenue growth once launched[16]. - The mobile game industry is expected to see a decline in daily active users and average online time, leading to a more conservative business strategy for mobile games owned and under development by the Group[37][41]. Corporate Governance - The company did not have a Chairman during the year ended December 31, 2021, which is a deviation from CG Code provision A.2.1[91]. - The company has implemented corporate governance measures focusing on shareholder integrity, quality of information disclosure, transparency, and accountability[94]. - The roles of Chairman and CEO are required to be separate under CG Code provision A.2.1, which the company did not comply with due to the absence of a Chairman[111]. - The company held its annual general meeting on May 27, 2021, with Mr. Chow Yik acting as the chairman in the absence of a designated Chairman[92]. - The Board comprises five Directors, including two executive Directors and three independent non-executive Directors, ensuring a balanced composition[99]. - The company aims to maintain high standards of corporate governance throughout its operations[96]. - The company currently has no Chairman and CEO following the resignations of Mr. Chan Wai Kit and Mr. Chan Kwun Chung on November 1, 2018, and April 1, 2020, respectively[116]. - The company received annual confirmations of independence from all INEDs, affirming their compliance with GEM Listing Rules[122]. Risk Management and Internal Control - The risk management and internal control systems are designed to manage risks rather than eliminate them, providing reasonable assurance against material misstatement[192]. - The Board is responsible for evaluating the risks the Company is willing to take to achieve its strategic objectives[191]. - The Company’s external auditor was Baker Tilly Hong Kong Limited, with no non-audit services provided during the year[183]. - The Board conducted an annual review of the internal control system, concluding that the Group had established a sound control environment[193]. - The Audit Committee reviewed financial reporting matters including quarterly, interim, and annual results, and evaluated the effectiveness of risk management and internal control systems[175]. Human Resources - As of December 31, 2021, the Group had 53 employees, with total staff costs amounting to approximately HK$16,791,000, an increase from approximately HK$14,724,000 in 2020[81][87]. - The Group's remuneration policy is periodically revised based on market conditions and individual performance[82]. Financial Position - As of December 31, 2021, the Group's total assets were approximately HK$35,678,000, a decrease from approximately HK$159,519,000 in 2020, while total liabilities were approximately HK$8,796,000, down from approximately HK$44,688,000 in 2020[64][68]. - The Group's gearing ratio improved to approximately 24.7% in 2021 from 28.0% in 2020, and the current ratio decreased to approximately 1.68 from 2.24 in the previous year[64][68]. - The Group's cash and cash equivalents as of December 31, 2021, were approximately HK$3,791,000, an increase from approximately HK$3,415,000 in 2020[59]. - The Group's funding strategy focuses on maintaining a healthy liquidity position through internally generated resources and equity or debt financing[77]. Lending Operations - The Group decided to cease the Money Lending Business segment upon the expiry of the money lending license on June 2, 2021, due to economic challenges and the impact of COVID-19[35][42]. - The Group plans to cease its lending operations after the expiration of its license on June 2, 2021, due to ongoing economic challenges[46]. - The Group has implemented strict credit assessment procedures to ensure comprehensive risk management in its lending operations[47]. - The Group is actively reviewing the recoverability of outstanding loans and formulating measures to minimize impairment losses, including legal actions if necessary[56]. - The methodology for measuring expected credit loss (ECL) is based on lifetime expected losses, reflecting the remaining lifetime of the financial asset[55]. Shareholder Matters - The Group did not recommend the payment of any final dividend for the year ended December 31, 2021[34][38]. - The Group's net proceeds from a previous share placement were approximately HK$32,337,000, with HK$30,879,000 utilized by December 31, 2021, leaving HK$1,458,000 unutilized[72][76].
悟喜生活(08148) - 2021 - 年度财报