Financial Performance and Risks - The Group's financial performance is impacted by various financial risks, including market risk, credit risk, and liquidity risk, with a focus on minimizing adverse effects on financial performance [14]. - Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities not denominated in the entity's functional currency, primarily affecting companies with Renminbi and US dollar functional currencies [14]. - The Group's investments in the PRC are exposed to foreign currency translation risk, managed primarily through dividends paid outside the PRC [14]. - The Group's overall risk management program focuses on the unpredictability of financial markets to mitigate potential adverse effects on financial performance [14]. - The Group closely monitors foreign currency rate movements to manage foreign exchange risk [14]. - The Group's credit risk is primarily from cash and cash equivalents, short-term bank deposits, and trade receivables, with ongoing monitoring of exposures [34]. - The Group's exposure to foreign currency risk includes cash and cash equivalents, trade receivables, and payables, with regular reviews and hedging strategies in place [24]. - The Group's exposure to interest rate risk is primarily from cash and cash equivalents, short-term bank deposits, finance payables, and bank borrowings [66]. Financial Results - For the year 2023, the Group's revenue decreased to approximately HK$462.3 million, representing a decrease of approximately 17.7% compared to 2022 [55]. - Loss for the year attributable to equity holders decreased to approximately HK$5.0 million, representing a decrease of approximately 85.5% compared to 2022 [55]. - Revenue under the Apparel Supply Chain Servicing Business was approximately HK$462.3 million in 2023, down from HK$561.8 million in 2022 [55]. - The decrease in revenue for 2023 was mainly due to a reduction in sales from existing customers [55]. - The gross profit for 2023 was HK$39.3 million, with a gross profit margin of 8.5%, compared to HK$42.6 million and a margin of 7.6% in 2022 [59]. - The net loss attributable to equity holders of the company for 2023 was HK$5.0 million, significantly improved from a loss of HK$34.5 million in 2022, representing a change of 85.5% [59]. - Total assets were HK$261.0 million, down 18.4% from HK$319.9 million in 2022 [59]. - Total liabilities decreased by 21.7% to HK$191.4 million in 2023 from HK$244.4 million in 2022 [59]. - The company's net assets as of December 31, 2023, were HK$69.5 million, a decline of 7.8% from HK$75.4 million in 2022 [59]. Cash Flow and Liquidity - As of December 31, 2023, the Group's cash and cash equivalents totaled HK$25,562,000, a decrease from HK$39,020,000 as of December 31, 2022 [16]. - The current ratio improved to 1.3 in 2023 from 1.2 in 2022, indicating better short-term financial health [59]. - The Group maintained a healthy liquidity position throughout 2023, supported by internal resources and bank borrowings [109]. - Short-term bank deposits were reported at HK$30,942,000 for 2023, with no deposits recorded in 2022 [67]. - Short-term bank deposits and cash equivalents totaled approximately HK$127.1 million as at 31 December 2023, with HK$90.0 million in HKD, HK$14.4 million in RMB, and HK$21.8 million in USD [107]. Operational Efficiency and Cost Management - The company plans to enhance product innovation and streamline production processes to improve operational efficiency and reduce costs [57]. - Selling and marketing expenses decreased to approximately HK$1.5 million (2022: HK$3.4 million) due to the downsizing of the scale of operation of the lossmaking subsidiary [94]. - Administrative expenses decreased to approximately HK$40.3 million (2022: HK$54.7 million) mainly due to the downsizing of the lossmaking subsidiary and a reduction in employee benefits expenses [96]. - The management will continue to implement cost-saving measures where appropriate to enhance profitability [92]. Corporate Governance - The company has complied with the Corporate Governance Code provisions, except for the roles of chairman and CEO being held by the same individual, which is currently Mr. Huang Chih Shen [130]. - The company emphasizes the importance of good corporate governance in balancing the interests of shareholders, customers, and employees [130]. - The Board currently comprises six Directors, including two executive Directors and four independent non-executive Directors [135]. - The Company has adopted a code of conduct for securities transactions by relevant employees, ensuring compliance with the Model Code [132]. - The Company established a nomination committee on 24 December 2012, with written terms of reference in compliance with Code Provisions B.3.1 [147]. ESG and Sustainability - The ESG Report is the eighth published by the Group, aiming to share efforts in maintaining competitiveness and moving toward sustainability in the garment market [192]. - The Board believes that sustainable development is key to long-term success and is committed to incorporating ESG considerations into business operations [198]. - The Group aims to improve sustainability performances through resource optimization in operations [198]. - The Group engaged external consultants to conduct a materiality assessment through stakeholder surveys to identify significant ESG-related topics [196]. Employee and Management Information - As of December 31, 2023, the Group had a total of 1,096 employees, with total staff costs approximately HK$60.2 million, down from HK$64.0 million in 2022 [111]. - The company aims to maintain gender diversity and will review its recruitment and management policies according to business needs [155]. - The remuneration policy for independent non-executive directors ensures adequate compensation for their contributions and time [159]. Audit and Risk Management - The audit committee held two meetings in 2023 to review the Group's accounting principles and internal controls, with all members attending both meetings [166]. - The internal audit function reviews the effectiveness of risk management and internal control systems, providing recommendations for improvement [181]. - The Audit Committee confirmed the effectiveness and adequacy of the Group's risk management and internal control system for the year ended December 31, 2023 [183].
迅捷环球控股(00540) - 2023 - 年度财报