Revenue and Profit Performance - Revenue for the first half of 2023 reached RMB 1,085,343 thousand, a 3.5% increase compared to RMB 1,048,628 thousand in the same period of 2022[1] - Net profit attributable to owners of the parent company surged to RMB 29,899 thousand, a significant increase from RMB 5,754 thousand in the first half of 2022[1] - The company reported a net profit of RMB 29,899 thousand for the six months ended June 30, 2023, compared to a net profit of RMB 5,754 thousand for the same period in 2022[18][19] - Pre-tax profit increased by RMB 13.8 million to RMB 30.6 million, driven by higher gross profit[53] - Net profit for the period increased by RMB 23.5 million to RMB 27.7 million[55] - The company's pre-tax profit for the six months ended June 30, 2023, was RMB 30,569 thousand[135] - Basic earnings per share for the six months ended June 30, 2023, were calculated based on a profit attributable to ordinary shareholders of RMB 29,899 thousand and 912,500,000 ordinary shares issued[163] Gross Profit and Margin - Gross profit increased by 7.7% to RMB 577,711 thousand, with gross margin rising from 51.2% to 53.2%[11] - GXG brand's gross profit increased by 16.0% to RMB 520,955 thousand, with gross margin improving by 2.6 percentage points to 56.5%[14] - Mode Commuter's gross profit surged by 61.3% to RMB 9,963 thousand, with gross margin increasing by 12.8 percentage points to 53.8%[15] - gxg.kids' gross profit decreased by 83.9% to RMB 6,132 thousand, with gross margin dropping by 32.1 percentage points to 10.9%[15] - The gross profit from self-operated stores increased by RMB 73.9 million or 29.4% year-over-year to RMB 325,478 thousand, with a gross margin increase of 4.2 percentage points to 73.4%[26] - The gross profit from online channels decreased to RMB 156,670 thousand with a gross margin of 36.7%, compared to RMB 194,950 thousand and a gross margin of 41.0% in the same period of 2022[26] - The total gross profit for the six months ended June 30, 2023, was RMB 577,711 thousand, with a gross margin of 53.2%, compared to RMB 536,486 thousand and a gross margin of 51.2% in the same period of 2022[26] - Partnership stores' gross profit decreased by RMB 10.6 million or 30.8% YoY, with gross margin dropping 11.2 percentage points to 29.8% due to subsidies and product supply adjustments[27] - Distributor stores' gross profit increased by RMB 16.7 million or 30.8% YoY, with gross margin rising 8.5 percentage points to 53.9% due to reduced product costs[27] - Online channel gross profit decreased by RMB 38.3 million or 19.6% YoY to RMB 156.7 million, with gross margin dropping 4.3 percentage points to 36.7% due to increased sales of discounted seasonal products[27] Store Performance and Optimization - The number of offline stores decreased from 1,122 at the end of 2022 to 1,047 as of June 30, 2023, due to store network optimization[10] - Partner stores experienced a 15.1% decrease in number, dropping from 184 to 158 stores[98] - The total number of stores decreased from 1,122 to 1,047, with self-operated stores making up 35.5% of the total[98] - The total number of offline stores decreased from 1,122 at the end of 2022 to 1,047 as of June 30, 2023, as the company adjusted brand positioning and marketing strategies to improve store efficiency[119] - The company's self-operated stores saw a 22.0% increase in sales, reaching RMB 443.6 million, compared to the same period in 2022[106] - The company's offline channel sales increased, with self-operated stores contributing 40.8% of total revenue[106] - Partnership store sales decreased by 4.8% or RMB 4.0 million to RMB 79.9 million compared to the same period in 2022, mainly due to subsidies provided to partners[107] Online Channel Performance - The company's online channel sales accounted for 39.3% of total revenue, amounting to RMB 426.8 million[106] - Online channel sales decreased by 10.2% or RMB 48.5 million to RMB 426.8 million compared to the same period in 2022, primarily due to the reduction of non-core brand business scale in online channels[107] - The company's income from online channel sales of clothing products for the six months ended June 30, 2023, was RMB 426,767 thousand, compared to RMB 475,318 thousand for the same period in 2022[149] Financial Position and Cash Flow - Total assets decreased to RMB 1,476,636 thousand as of June 30, 2023, compared to RMB 1,404,673 thousand at the end of 2022[6] - Total liabilities decreased to RMB 785,334 thousand as of June 30, 2023, from RMB 716,195 thousand at the end of 2022[8] - The company's cash and cash equivalents stood at RMB 220,912 thousand as of June 30, 2023, compared to RMB 252,194 thousand at the end of 2022[6] - The company's total equity as of June 30, 2023, was RMB 691,302 thousand, compared to RMB 712,953 thousand as of June 30, 2022[18][19] - The company's cash and cash equivalents decreased by RMB 31,582 thousand to RMB 220,912 thousand as of June 30, 2023, from RMB 252,194 thousand at the beginning of the period[24] - The company's operating cash flow for the six months ended June 30, 2023, was a net outflow of RMB 33,282 thousand, compared to a net outflow of RMB 347,176 thousand in the same period of 2022[22] - The company's net cash used in investing activities was RMB 58,209 thousand for the six months ended June 30, 2023, compared to RMB 95,482 thousand in the same period of 2022[24] - The company's net cash from financing activities was RMB 59,909 thousand for the six months ended June 30, 2023, compared to RMB 298,278 thousand in the same period of 2022[24] - Net operating cash outflow was RMB 33.3 million, a decrease of RMB 313.9 million from the same period in 2022, mainly due to reduced inventory[57] - Cash and cash equivalents decreased by 21.0% or RMB 290.7 million to RMB 1,095.1 million[59] - Asset-liability ratio increased to 53.0% from 50.3%, mainly due to seasonal borrowing for prepayment of winter goods[60] Expenses and Costs - Sales and distribution expenses increased by 5.1% or RMB 21.5 million YoY to RMB 439.3 million, primarily due to increased advertising costs[35] - Administrative expenses increased by 4.8% or RMB 4.9 million YoY to RMB 106.4 million, mainly due to higher professional service costs[37] - Financial assets impairment loss net amount was RMB 4.9 million, compared to a reversal of RMB 12.6 million in the same period of 2022, mainly due to increased trade receivables from some customers and higher expected credit loss rates[50] - Other expenses increased by 45.2% or RMB 1.9 million to RMB 6.1 million, primarily due to higher decoration costs from closed stores[51] - Financial costs increased by 5.3% or RMB 1.6 million to RMB 31.7 million, mainly due to higher bank loan interest[52] - Income tax expenses decreased by RMB 9.7 million to RMB 2.9 million[54] - The company's total financial costs for the six months ended June 30, 2023, were RMB 31,675 thousand, including bank and other borrowing interest of RMB 31,783 thousand and lease liability interest of RMB 3,216 thousand[153] - The company's total tax expense for the six months ended June 30, 2023, was RMB 2,904 thousand, compared to RMB 12,636 thousand for the same period in 2022[156] Strategic Initiatives and Future Plans - The company plans to use the remaining RMB 19.8 million of IPO proceeds within the next 18 months for strategic purposes[47] - The company aims to enhance its leading position in the fashion industry through innovative marketing, retail technology, and optimized store management[38] - The company's integrated omni-channel business model leverages both online and offline advantages to enhance inventory and supply chain management[90] - The company's restricted stock unit plan aims to incentivize and retain skilled personnel for future development and expansion[86] - The company's restricted stock unit plan has a remaining term of approximately 5 years and 10 months as of June 30, 2023[96] Corporate Governance and Compliance - The company has applied the principles of the Corporate Governance Code and complied with all applicable code provisions to maintain high standards of corporate governance[110] - The Audit Committee reviewed the unaudited interim results for the six months ended June 30, 2023, and confirmed compliance with applicable accounting principles, standards, and regulations[113] - The company has adopted the Model Code for Securities Transactions by Directors and confirmed that all directors have complied with the code's provisions during the period[111] - The company did not purchase, sell, or redeem any of its listed securities during the period[112] - The company has applied the amendments to IAS 1, which require the disclosure of material accounting policy information, effective from January 1, 2023, and expects it to impact the annual financial statements[131] Shareholding and Ownership - The company has 950,000,000 issued ordinary shares as of June 30, 2023[78] - Great World Glory Pte. Ltd. holds a 38.27% beneficial ownership stake with 363,579,785 shares[80] - L Capital Asia 2 Pte. Ltd. and related entities collectively hold a 38.27% controlled interest with 363,579,785 shares[80] - Crescent Glory Singapore Pte. Ltd. holds a 14.15% beneficial ownership stake with 134,474,715 shares[80] - GXG Trading Limited holds a 22.50% beneficial ownership stake with 213,750,000 shares[80] - Yu Yong holds 2,000,000 restricted stock units, equivalent to shares held in trust[77] - Madison International Limited controls 22.50% of the company's shares through GXG Trading Limited[80] Asset and Liability Details - Inventory decreased to RMB 556,644 thousand as of June 30, 2023, compared to RMB 683,493 thousand at the end of 2022, with finished goods accounting for the majority at RMB 546,749 thousand[173] - Trade receivables decreased to RMB 703,057 thousand as of June 30, 2023, from RMB 755,334 thousand at the end of 2022, with a significant portion (56.7%) aged over 2 years[169] - Trade payables and notes payable decreased to RMB 279,100 thousand as of June 30, 2023, from RMB 439,366 thousand at the end of 2022, with a significant portion (30.2%) aged over 2 years[184] - Property, plant, and equipment increased to RMB 337,183 thousand as of June 30, 2023, from RMB 311,239 thousand at the end of 2022, with additions of RMB 58,476 thousand during the period[165] - Intangible assets decreased to RMB 35,782 thousand as of June 30, 2023, from RMB 38,591 thousand at the end of 2022, with amortization of RMB 2,669 thousand during the period[172] - Other receivables and prepayments decreased to RMB 340,679 thousand as of June 30, 2023, from RMB 389,733 thousand at the end of 2022, with a significant portion (79.7%) related to other receivables[176] - The company's credit terms with customers (excluding retail customers) generally range from one to three months, with some extending up to one year[174] - The company has no collateral or credit enhancements for its trade receivables, which are non-interest bearing[174] - The company's trade payables are non-interest bearing and generally settled within 120 days[191] - Total interest-bearing bank and other borrowings decreased to RMB 1,602,137 thousand as of June 30, 2023, compared to RMB 1,772,240 thousand as of December 31, 2022[195] - Bank loans of USD 29,600,000 are secured by fixed deposits amounting to RMB 231,216,000 as of June 30, 2023, down from RMB 236,832,000 as of December 31, 2022[195] - Discounted letters of credit decreased to RMB 87,981,000 as of June 30, 2023, from RMB 100,000,000 as of December 31, 2022, secured by fixed deposits of RMB 28,895,000[196] - Other payables decreased to RMB 185,052 thousand as of June 30, 2023, from RMB 203,789 thousand as of December 31, 2022[198] - Short-term secured bank loans with a five-year loan base rate amounted to RMB 25,805 thousand as of June 30, 2023, up from RMB 22,450 thousand as of December 31, 2022[200] - Secured bank loans with a three-month LIBOR plus 1.14% rate amounted to RMB 21,655 thousand as of June 30, 2023[200] - Secured bank loans with a rate of -3.40% decreased to RMB 193,086 thousand as of June 30, 2023, from RMB 387,194 thousand as of December 31, 2022[200] - Discounted bills receivable secured decreased to RMB 127,980 thousand as of June 30, 2023, from RMB 215,980 thousand as of December 31, 2022[200] - Unsecured bank loans decreased to RMB 160,000 thousand as of June 30, 2023, from RMB 262,841 thousand as of December 31, 2022[200] - Non-current secured bank loans with a three-month LIBOR plus 1.14% rate amounted to RMB 181,801 thousand as of June 30, 2023, down from RMB 185,573 thousand as of December 31, 2022[200] Other Income and Gains - Other income and gains increased by 93.0% or RMB 19.9 million YoY to RMB 41.3 million, driven by higher investment income from fixed deposits and foreign exchange gains[28] - The company's other income and gains for the six months ended June 30, 2023, totaled RMB 41,266 thousand, including foreign exchange gains, government grants, and bank interest income[147] Sales Revenue by Brand - GXG Jeans sales revenue decreased by 13.2% or RMB 13.2 million YoY due to store optimization efforts[43] - The company's main brand GXG sales revenue increased by 10.6% or RMB 88.1 million compared to the same period in 2022, driven by the recovery of offline consumer spending and improved operational efficiency in offline retail channels[115] - gxg.kids sales revenue decreased by 36.4% or RMB 32.2 million due to the company's reduction in business scale[104] - Mode Commuter sales revenue increased by 22.5% or RMB 3.4 million, driven by improved management and optimized product offerings[104] Dividend and Financial Statements - The company did not recommend the payment of any interim dividend for the period[108] - The company did not declare any interim dividend for the six months ended June 30, 2023[157] - The company's income from external customers for the six months ended June 30, 2023, was RMB 1,085,343 thousand, with RMB 1,084,959 thousand from goods transferred at a point in time and RMB 384 thousand from services transferred at a point in time[147] - Total revenue for the six months ended June 30, 2023, was RMB 1,085,343 thousand, with offline channels contributing RMB 655,126 thousand and online channels contributing RMB 426,767 thousand[135] Non-Current Assets and Liabilities - Non-current assets in Mainland China decreased from RMB 565,877 thousand as of December 31, 2022, to RMB 522,893 thousand as of June 30, 2023[145] - Capital expenditures decreased by 38.4% or RMB 36.8 million to RMB 59.0 million, primarily due to lower decoration costs for the headquarters office[58]
慕尚集团控股(01817) - 2023 - 中期财报