华美乐乐(08429) - 2022 - 年度财报

Revenue and Financial Performance - Revenue from marketing production services decreased by approximately 22% in 2022 compared to the previous year[13] - Media business revenue increased 17.9 times to HK$22.1 million in 2022, up from HK$1.2 million in 2021, driven by the development of original branded content[14][18] - Total group revenue increased 16.1% to HK$59.6 million in 2022, compared to HK$51.4 million in 2021[17] - Marketing production revenue decreased 22.5% to HK$37.5 million in 2022, down from HK$48.4 million in 2021, due to a reduction in project volume[18] - E-commerce and retail revenue dropped significantly to HK$9,000 in 2022, with no revenue from the café operation, as these businesses were suspended[19] - Group loss decreased by approximately 83$21.0 million in 2022, up from HK$19.1 million in 2021, primarily due to the expansion of the media business[23][24] - Materials and consumables costs decreased 33.3$4.0 million in 2022, down from HK$6.0 million in 2021, due to the suspension of e-commerce, retail, and café operations[25][27] - Depreciation and amortization expenses decreased 30.2$4.2 million in 2022, compared to HK$6.0 million in 2021, mainly due to the suspension of certain businesses[28] - Employee benefit expenses decreased slightly by 0.6$16.2 million in 2022, down from HK$16.3 million in 2021, as reductions from suspended operations were offset by media business expansion[29][30] - Rental expenses increased 37.6$2.2 million in 2022, up from HK$1.6 million in 2021, due to new short-term leases for media business operations in China[31] - Transportation expenses decreased by 2.2$4,502,240 to support its brand-integrated content production media business[48] - The property will be used as employee housing, offices, and client/business partner networking venues in Los Angeles[48] - An indirectly owned subsidiary registered in the United States was dissolved during the year[49] - The company has no other plans for significant investments or capital assets[51] Corporate Governance and Board Structure - The company maintains high corporate governance standards, emphasizing a high-quality board, robust internal controls, transparency, and accountability to protect shareholder interests[67] - The company deviates from the corporate governance code by having the same individual serve as both Chairman and CEO, citing the individual's extensive experience and leadership effectiveness[67][68] - The board consists of three independent non-executive directors, ensuring a balanced mix of expertise and experience to manage the company's operations effectively[83][86] - The Board of Directors holds at least four meetings annually, approximately quarterly, to oversee the company's business and affairs, ensuring management aligns with shareholder and company interests[87] - The company has adopted a policy to obtain independent views and opinions, ensuring high standards of corporate governance and maintaining the independence of non-executive directors[88] - The Board, its committees, or individual directors can seek independent professional advice at the company's expense to fulfill their duties and exercise independent judgment[90] - The company's senior management regularly interacts with the Board during formal and informal meetings, providing all necessary information for decision-making[91] - The company has reviewed and confirmed the effective implementation of the Board's independence policy during the year[92] - Directors are appointed, re-elected, or removed based on fixed-term service contracts or appointment letters, with one-third of directors required to retire by rotation each year[93] - Directors are required to participate in continuous professional development to update their knowledge and skills, ensuring effective contributions to the Board[96] - The Board has established three committees: Audit, Remuneration, and Nomination, each with sufficient resources and approved terms of reference[98] - The Audit Committee, consisting of three independent non-executive directors, held six meetings during the year to review financial reporting, internal controls, and compliance with governance policies[99][101] - The Audit Committee is responsible for the initial establishment and maintenance of the internal control framework and the company's management code of conduct[100] - The Remuneration Committee, established on November 16, 2017, is responsible for reviewing and recommending compensation policies for directors and senior management[102] - The Audit Committee held one meeting during the year to review matters including the remuneration policies and structures for directors and senior management[103] - The Nomination Committee, also established on November 16, 2017, focuses on reviewing the Board's structure, size, composition, and diversity, and provides recommendations for director appointments[107] - The Board held 6 meetings, the Audit Committee held 6 meetings, the Remuneration Committee held 2 meetings, and the Nomination Committee held 1 meeting during the year[111] - The company's remuneration policy for directors is based on their experience, rank, and overall market conditions, reviewed and adjusted annually[106] - The company has set measurable goals for diversity in candidate recruitment and selection, including gender, age, cultural and educational background, and professional experience[114] - The Board is responsible for overseeing compliance with legal and regulatory requirements, as well as the training and professional development of directors and senior management[110] - The board of directors consists of 5 members, with 1 female director, aiming to maintain at least the current level of female representation and ultimately achieve gender equality[115] - The gender ratio of employees (including senior management) as of December 31, 2022, is 3:8, with the company committed to maintaining gender diversity[116] - The company has adopted a nomination policy to appoint high-quality directors capable of leading the company towards sustainable development, focusing on qualifications, experience, skills, and diversity[118] - The nomination committee identifies qualified candidates for the board and recommends appointments, with the board having final responsibility for all matters related to the selection and appointment of directors[119] - The board is responsible for preparing true and fair consolidated financial statements in accordance with Hong Kong Financial Reporting Standards and the Hong Kong Companies Ordinance[120] - The audit and non-audit fees paid to the company's auditor, ZhongShen ZhongHuan (Hong Kong) CPA Limited, for the year ended December 31, 2022, totaled HKD 620,000[122] - The company has established a risk management team to execute risk identification, assessment, and management procedures, with quarterly risk identification and analysis conducted[127] - The board confirms its overall responsibility for maintaining effective risk management and internal controls, with senior management responsible for designing and implementing internal control systems[124] - The company has outsourced its internal audit function to an independent external consulting firm to review the effectiveness of internal control measures, ensuring an annual review of the internal control system[125] - The audit committee has reviewed the effectiveness of the company's internal control and risk management systems, concluding that they were effective and adequate for the year ended December 31, 2022[127] Shareholder and Equity Information - As of December 31, 2022, the company had net current assets of approximately HKD 18.9 million (2021: HKD 58.1 million), including cash and bank balances of HKD 17.0 million (2021: HKD 56.2 million)[41] - The company's debt-to-equity ratio was 5.5% as of December 31, 2022 (2021: 11.0%)[41] - The company's equity attributable to owners was approximately HKD 64.8 million as of December 31, 2022 (2021: HKD 69.7 million)[41] - The company did not have any pledged assets as of December 31, 2022 (2021: none)[42] - The company did not enter into any derivative agreements or use financial instruments to hedge foreign exchange risks during the year[43] - The company had no significant capital commitments or contingent liabilities as of December 31, 2022 (2021: none)[44][45] - The company's issued share capital as of December 31, 2022, was HKD 4,800,000, with 480,000,000 ordinary shares issued at a par value of HKD 0.01 per share[154] - The company's distributable reserves as of December 31, 2022, were approximately HKD 52,377,000, compared to HKD 58,087,000 in 2021[156] - The largest customer contributed approximately 21.2% of total revenue in 2022, down from 27.4% in 2021, while the top five customers accounted for 69.3% of total revenue, up from 67.0% in 2021[161] - The largest supplier accounted for approximately 9.8% of total service costs in 2022, down from 20.0% in 2021, while the top five suppliers represented 34.3% of total service costs, down from 54.2% in 2021[161] - The company's share option plan allows for the issuance of up to 48,000,000 shares, equivalent to 10% of the issued share capital[166] - The share option plan has a remaining term of approximately 4 years and 8 months, with no options granted since its adoption in 2017[162] - The company did not purchase, sell, or redeem any of its listed securities during the year or up to the report date[159] - The company's property, plant, and equipment details are provided in Note 14 of the consolidated financial statements[153] - The company's five-year financial summary, including audited results and assets and liabilities, is available on page 142 of the annual report[152] - The company confirmed that the controlling shareholders complied with the non-compete deed during the year ended December 31, 2022[150] - Chairman and CEO Ms. Hu Chen holds 277,200,000 shares, representing 57.75% of the company's equity[174] - Ms. Hu Chen, through Explorer Vantage, owns 100% of Pipa Jin Printing Co., Ltd[174] - Mirousky Limited holds 34,850,000 shares, representing 7.26% of the company's equity, with Ms. Hu Chen and her spouse each owning 50% of Mirousky[174] - Explorer Vantage, wholly owned by Ms. Hu Chen, holds 277,200,000 shares, representing 57.75% of the company's equity[179] - Mr. Hu Jianbang, spouse of Ms. Hu Chen, holds 277,200,000 shares, representing 57.75% of the company's equity[179] - Mirousky Limited, wholly owned by Dejun Asia Limited, holds 34,850,000 shares, representing 7.26% of the company's equity[179] - Ms. Zhou Weiying holds 35,950,000 shares, representing 7.49% of the company's equity[179] - The company's indirect wholly-owned subsidiary, Ice Production, entered into a bank financing agreement with DBS Bank (Hong Kong) Limited for a maximum loan amount of HKD 10,000,000, with the company's controlling shareholder, Ms. Hu Chen, required to hold at least 51% beneficial interest in the company and Ice Production[186] - In 2020, the financing limit was adjusted to HKD 9,500,000 after a periodic review, with all other terms and conditions of the financing agreement remaining unchanged[189] - The financing agreement was canceled in July 2022[190] - The company's quarterly rent with 4L 108 Leonard LLC, a related party, amounted to HKD 1,127,366 for the year ended December 31, 2022[194] - The company's retail space rent with Jianwei Engineering Limited, another related party, amounted to HKD 58,000 for the year ended December 31, 2022[194] Environmental and Social Responsibility - The company has implemented green office measures to reduce energy and natural resource consumption, including the use of eco-friendly paper and energy-saving practices[198] - The company's environmental policies and regulatory compliance are detailed in the Environmental, Social, and Governance (ESG) report on pages 46 to 63 of the annual report[143] - The company focuses on creating a positive and progressive corporate culture to drive long-term sustainable growth and fulfill its responsibilities as a corporate citizen[69] - The company emphasizes trust, responsibility, expertise, development, and teamwork as core values to deliver high-quality services and foster collaboration[70][73][74][75][76] - The company integrates its culture into recruitment processes and provides training to new employees to align with its corporate values and strategies[78][79] - The company adopts a decentralized decision-making structure to enhance operational efficiency and cultural development within the organization[80] Key Performance Indicators and Risk Management - The company's key performance indicators (KPIs) for the year are analyzed in the "Management Discussion and Analysis — Financial Review" section on pages 6 to 9 of the annual report[144] - The company's major risks and uncertainties are detailed in the "Management Discussion and Analysis" section on page 10 of the annual report[145] - The company has established a risk management team to execute risk identification, assessment, and management procedures, with quarterly risk identification and analysis conducted[127] - The board confirms its overall responsibility for maintaining effective risk management and internal controls, with senior management responsible for designing and implementing internal control systems[124] - The company has outsourced its internal audit function to an independent external consulting firm to review the effectiveness of internal control measures, ensuring an annual review of the internal control system[125] - The audit committee has reviewed the effectiveness of the company's internal control and risk management systems, concluding that they were effective and adequate for the year ended December 31, 2022[127] Dividend Policy and Shareholder Communication - The company did not recommend any dividend payment for the year[148] - The company adopted a dividend policy, allowing for the declaration and distribution of dividends to shareholders, subject to post-tax profits and normal operations[146] - The company's shareholder communication policy ensures that shareholders have convenient, equal, and timely access to balanced and understandable information[133] - The company's procedures for handling and disclosing inside information include immediate disclosure upon becoming aware of inside information, compliance with applicable laws and regulations, and implementation of monitoring procedures[129] Employee and Management Information - The company employed a total of 42 full-time employees as of December 31, 2022, compared to 40 in 2021[47] - Yeung holds independent non-executive director positions at multiple listed companies including Kin Shing International Group Limited (0224) since June 23, 1999, and Pak Fah Yeow International Limited (0239) since September 8, 2004[58] - Kong Qinglun, an independent non-executive director since April 3, 2017, has over 23 years of experience in finance and investment, including founding Oriental Patron Securities Limited and serving as a director at Kennen Investment Holdings Limited[58] - Man Ka Ho, an independent non-executive director since November 16, 2017, holds a Bachelor of Science in Business Studies from City University of London and has over 17 years of legal experience[59] - Chan Sze Wan, Vice President since January 2018, oversees the company's financial and operational work, with over 21 years of experience in accounting and audit[60] - Chang David Qi, Strategic Investment Director since August 2019, leads the company's e-commerce business and has 11 years of experience in consumer tech business expansion in Asia[60] - Zhang Xuefen, with over 21 years of service, assists the CEO in overseeing business activities and has been instrumental in the company's transformation from a traditional printing management company to a marketing production company[61] - Chen Huaiyi, responsible for printing, packaging, and procurement since May 2005, has over 15 years of experience in the company and nearly eight years in the printing industry prior to joining[61] - Wang Jinyi, Director of the company's China subsidiary since 2021, has extensive experience in corporate and brand management, including co-founding Momentum Sports, which was acquired by Creative Artists Agency in 2018[63] - Lam Chi Fung, responsible for talent and infrastructure management since June 2007, holds a Bachelor of Science in Information Systems from Anglia Ruskin University and a Master of Science in Information Systems Management from HKUST[63] - Hu Chen has been appointed as the company's Compliance Officer, with details provided in the "Directors and Senior Management" section of the report[64] - The company's senior management salary distribution for the fiscal year ending December 31, 2022, shows 5 individuals earning between HKD 1 and HKD 1,000,000, and 1 individual earning between HKD 1,500,001 and HKD 2,000,000[104]