Financial Performance - The total revenue for the first half of 2023 was approximately RMB1,375.3 million, representing a year-over-year increase of approximately 7.7% compared to RMB1,277.5 million in the same period of 2022[11]. - Gross profit for the first half of 2023 was approximately RMB1,001.3 million, reflecting a year-over-year increase of approximately 3.3% from RMB969.1 million in the same period of 2022[11]. - Profit attributable to shareholders for the semi-annual period was approximately RMB10.3 million, a significant decrease of approximately 83.2% compared to RMB61.3 million in the same period of 2022[11]. - Basic and diluted earnings per share for the profit attributable to shareholders was approximately RMB0.02, down from RMB0.13 for the six months ended June 30, 2022[11]. - The Group's revenue for the Reporting Period was approximately RMB1,375.3 million, an increase of approximately 7.7% compared to RMB1,277.5 million in the same period of 2022[13]. - Revenue from third-party e-commerce platforms was approximately RMB1,304.0 million, representing an increase of approximately RMB103.7 million, or approximately 8.6%, compared to RMB1,200.3 million in the same period of 2022[14]. - Revenue from North America was approximately RMB1,286.5 million, an increase of approximately RMB66.4 million, or approximately 5.4%, compared to RMB1,220.1 million in the same period of 2022[19]. - The Group's cost of sales for the Reporting Period was RMB374.0 million, an increase of approximately RMB65.6 million, or approximately 21.3%, compared to RMB308.4 million in the same period of 2022[22]. - Gross profit amounted to approximately RMB1,001.3 million, an increase of approximately RMB32.2 million compared to RMB969.1 million in the same period of 2022, with a gross profit margin of approximately 72.8%, down 3.1 percentage points from 75.9%[24]. - Selling expenses and distribution costs amounted to approximately RMB923.9 million, an increase of approximately RMB85.6 million, or approximately 10.2%, compared to RMB838.3 million in the same period of 2022[33]. - General and administrative expenses increased by approximately RMB10.2 million, or approximately 16.2%, to RMB73.1 million for the Reporting Period compared to RMB62.9 million in the same period of 2022[34]. - Profit before income tax decreased by approximately 85.1% to approximately RMB10.7 million for the Reporting Period from approximately RMB71.3 million for the six months ended 30 June 2022[41]. - Total comprehensive income attributable to shareholders decreased by approximately 83.2% to approximately RMB10.3 million for the Reporting Period from approximately RMB61.3 million for the six months ended 30 June 2022[48]. Operational Efficiency - The company expanded its product categories and focused on various core brand directions to enhance its market presence[7]. - New sales channels, including the Temu platform, were introduced to optimize the Group's revenue structure[7]. - A one-stop sales management system was established to improve operational efficiency through digitalization[8]. - The company adjusted its organizational structure for centralized management and resource allocation to enhance management efficiency[7]. - Sales through third-party e-commerce platforms, particularly on Amazon, contributed significantly to revenue growth[6]. - The company aims to become a world-renowned e-commerce operator in fashion apparel and footwear products[6]. - The company plans to explore new sales channels, such as TikTok, and develop overseas physical stores to achieve broader market coverage[64]. - Continuous upgrades to the product portfolio will cater to diverse fashion preferences and personalized needs, enhancing sales performance of hot-selling products[64]. - The company aims to consolidate brand concentration and implement a high-end branding strategy to increase product added value[64]. - Investment in digitization will be increased to develop IT systems for new product development and refined operation of the entire product lifecycle[65]. - The company will enhance inventory turnover efficiency through expanded sales channels and refined operations to improve inventory structure[65]. - Development of a global supply chain and full digitalization is planned to establish a flexible, efficient, green, and digital global supply chain platform[66]. Financial Position - As of June 30, 2023, the Group had cash and cash equivalents of approximately RMB314.6 million, an increase from approximately RMB294.5 million as of December 31, 2022, representing a growth of about 6.4%[53]. - The Group's total liabilities to total assets ratio (gearing ratio) remained stable at approximately 42.1% as of both June 30, 2023, and December 31, 2022[54]. - As of June 30, 2023, the Group's borrowings amounted to approximately RMB147.6 million and lease liabilities were approximately RMB62.0 million, indicating a total indebtedness of approximately RMB209.6 million[55]. - Total staff costs incurred by the Group during the Reporting Period were approximately RMB110.0 million, reflecting a year-over-year increase of approximately 47.7% compared to RMB74.5 million in the same period of 2022[60]. - The Group did not experience any significant operational difficulties due to fluctuations in currency exchange rates during the Reporting Period[58]. - The Group does not have any pledged assets as of June 30, 2023[58]. - The Group's employee count stood at 1,155 full-time employees as of June 30, 2023, primarily based in mainland China[60]. Corporate Governance - The company has established an Audit Committee consisting of three independent non-executive Directors to ensure compliance with the Listing Rules and Corporate Governance Code[87]. - The interim financial results for the Reporting Period have not been audited but are considered compliant with relevant accounting standards[88]. - The company is committed to maintaining high standards of corporate governance to safeguard shareholder interests and enhance corporate value[83]. - The company has complied with the Corporate Governance Code, except for a deviation regarding the separation of roles between the chairman and the chief executive officer[84]. - The company will continue to review and monitor its corporate governance practices to ensure compliance with the Corporate Governance Code[85]. - The company is governed by a trust structure involving multiple shareholders and their interests in controlled corporations[72]. - The report indicates no other directors or chief executives have interests in the shares as of June 30, 2023[72]. Shareholder Information - As of June 30, 2023, Mr. Hua Bingru holds 261,144,457 shares, representing 52.23% of the shareholding[69]. - Mr. Wang Shijian holds 44,466,717 shares, representing 8.89% of the shareholding[69]. - Mr. Wang Weiping holds 22,608,772 shares, representing 4.52% of the shareholding[69]. - As of June 30, 2023, the total number of shares issued by the company is 500,000,000[70]. - Hone Ru and its subsidiaries collectively hold 236,056,036 shares, accounting for about 47.21% of the total shareholding[74]. - The company has disclosed interests and short positions of substantial shareholders as required by the SFO[73]. - The company did not recommend the payment of an interim dividend for the Reporting Period, consistent with the previous year[82]. Cash Flow and Investments - The company generated cash from operations amounting to RMB 74,881,000, a significant increase from RMB 17,311,000 in the same period of 2022, representing a growth of approximately 333%[119]. - The net cash generated from operating activities for the first half of 2023 was RMB 57,332,000, compared to RMB 12,038,000 in the prior year, indicating a year-over-year increase of about 376%[119]. - The company incurred net cash used in investing activities of RMB 2,962,000 for the first half of 2023, a decrease from RMB 8,325,000 in the same period of 2022, showing an improvement of approximately 64%[120]. - The company reported a net cash used in financing activities of RMB 42,201,000 for the first half of 2023, compared to RMB 3,710,000 in the same period of 2022, representing an increase of approximately 1035%[121]. - The dividends distributed to shareholders amounted to RMB 21,885,000 during the reporting period[117]. Taxation - Current income tax expenses were RMB3.977 million for the Reporting Period, down from RMB11.597 million in the same period of 2022[45]. - The Group's total income tax expense for the six months ended June 30, 2023, was RMB 379,000, down from RMB 10,034,000 in 2022, a decrease of approximately 96.2%[178]. - The corporate income tax rate for the Company's subsidiaries in China is generally 25%, but certain subsidiaries qualified as high-tech enterprises benefit from a reduced rate of 15% for three years[187]. - Several subsidiaries in China qualified as small and micro enterprises, enjoying a corporate income tax rate of 20% for the six months ended June 30, 2023[189]. - A 10% withholding tax is levied on dividends declared by PRC subsidiaries to foreign holding companies, which may be reduced to 5% under certain tax treaty arrangements[191]. Future Outlook - In the second half of 2023, the market will face various unknown challenges, affecting overall performance in the consumer goods market[64]. - The company plans to enhance sales and branding capabilities, with an estimated HK$81.2 million allocated for this purpose, expected to be fully utilized by the end of 2025[97]. - The expected timetable for the use of unutilized net proceeds is by the end of 2025 for various projects[99].
子不语(02420) - 2023 - 中期财报