0 2 0 2 t r o p e R l a u n n A Annual Report 2020 年報 0 2 0 2 報 年 Contents 2 CORPORATE INFORMATION 62 INDEPENDENT AUDITOR’S REPORT 4 FINANCIAL SUMMARY 67 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 6 CHAIRMAN’S STATEMENT 68 CONSOLIDATED STATEMENT OF FINANCIAL POSITION 8 BUSINESS REVIEW AND OUTLOOK 70 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 20 MANAGEMENT DISCUSSION AND ANALYSIS 71 CONSOLIDATED STATEMENT OF CASH FLOWS 27 BIOGRAPHIES OF THE DIRECTORS AND 73 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS SENIOR MANAGEMENT 30 DIRECTORS’ REPORT 156 FIVE-YEAR FINANCIAL SUMMARY 52 CORPORATE GOVERNANCE REPORT Corporate Information BOARD OF DIRECTORS AUDITOR Executive Directors Deloitte Touche Tohmatsu Mr. Ho Kuang-Chi (Chairman) Certified Public Accountants Ms. Zhao Yi 35/F, One Pacific Place 88 Queensway Non-executive Directors Hong Kong Ms. Chen Su-Yin Mr. Zhang Chi COMPANY’S WEBSITE www.xiabu.com Independent Non-executive Directors Ms. Hsieh Lily Hui-yun STOCK CODE Mr. Hon Ping Cho Terence Ms. Cheung Sze Man 520 Alternate Director HEADQUARTERS AND PRINCIPAL Ms. Li Jie (alternate to Mr. Zhang Chi) PLACE OF BUSINESS IN THE PRC Suncun Industrial Development Zone AUDIT COMMITTEE Huangcun Town Ms. Hsieh Lily Hui-yun (Chairman) Daxing District Mr. Zhang Chi (Ms. Li Jie as his alternate) Beijing Mr. Hon Ping Cho Terence PRC NOMINATION COMMITTEE CAYMAN ISLANDS PRINCIPAL SHARE REGISTRAR AND TRANSFER AGENT Mr. Ho Kuang-Chi (Chairman) Ms. Hsieh Lily Hui-yun Conyers Trust Company (Cayman) Limited Ms. Cheung Sze Man 2901 One Exchange Square Connaught Place Central REMUNERATION COMMITTEE Hong Kong Mr. Hon Ping Cho Terence (Chairman) Mr. Ho Kuang-Chi HONG KONG SHARE REGISTRAR Ms. Cheung Sze Man Computershare Hong Kong Investor Services Limited Shops 1712–1716, 17th Floor COMPANY SECRETARY Hopewell Centre Ms. Ng Sau Mei (resigned on 17 December 2020) 183 Queen’s Road East Ms. Tam Shuk Wah Carrie (since 17 December 2020) Wanchai Hong Kong 2 XIABUXIABU CATERING MANAGEMENT (CHINA) HOLDINGS CO., LTD. Corporate Information REGISTERED OFFICE IN CAYMAN ISLANDS Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands PRINCIPAL PLACE OF BUSINESS IN HONG KONG Room 1201, 12/F OfficePlus @Wan Chai No. 303 Hennessy Road Wanchai Hong Kong LEGAL ADVISER Simpson Thacher & Bartlett PRINCIPAL BANKS Bank of Communications China Merchants Bank Shanghai Pudong Development Bank Fubon Bank ICBC Bank Postal Savings Bank of China INVESTOR RELATIONS Tel: 36895925 E-mail: [email protected] 2020 ANNUAL REPORT 3 Financial Summary CONSOLIDATED RESULTS For the year ended 31 December 2020 2019 2018 2017 2016 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Revenue 5,455,246 6,030,167 4,734,080 3,663,993 2,758,137 Profit before tax 67,177 503,193 609,440 542,787 473,122 Profit for the year attributable to owners of the Company 1,837 288,100 462,478 420,170 368,028 ASSETS AND LIABILITIES As at 31 December 2020 2019 2018 2017 2016 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Assets Non-current assets 3,562,387 3,619,250 1,214,492 865,096 594,847 Current assets 2,217,569 2,006,636 2,038,824 1,980,496 1,717,757 Total assets 5,779,956 5,625,886 3,253,316 2,845,592 2,312,604 Equity and liabilities Total equity 2,340,168 2,386,840 2,247,467 1,985,531 1,716,308 Non-current liabilities 1,460,983 1,525,293 11,692 13,287 15,645 Current liabilities 1,978,805 1,713,753 994,157 846,774 580,651 Total liabilities 3,439,788 3,239,046 1,005,849 860,061 596,296 Total equity and liabilities 5,779,956 5,625,886 3,253,316 2,845,592 2,312,604 Net current assets 238,764 292,883 1,044,667 1,133,722 1,137,106 Total assets less current liabilities 3,801,151 3,912,133 2,259,159 1,998,818 1,731,953 4 XIABUXIABU CATERING MANAGEMENT (CHINA) HOLDINGS CO., LTD. Financial Summary REVENUE RMB’000 6,030,167 5,455,246 4,734,080 3,663,993 2,758,137 2020 2019 2018 2017 2016 PROFIT BEFORE TAX PROFIT FOR THE YEAR ATTRIBUTABLE TO RMB’000 OWNERS OF THE COMPANY RMB’000 462,478 420,170 609,440 368,028 542,787 503,193 473,122 288,100 67,177 1,837 2020 2019 2018 2017 2016 2020 2019 2018 2017 2016 2020 ANNUAL REPORT 5 Chairman’s Statement Mr. Ho Kuang-Chi Chairman of the Board Dear Shareholders, 2020 had been a challenging year for everyone, the outbreak of the pandemic had created a huge challenge On behalf of the board of directors (the “Board”) for for many businesses, the food and beverage, retail Xiabuxiabu Catering Management (China) Holdings Co., and hospitality industries were a few of the hardest Ltd., I am pleased to present the annual report of the hit industries. Xiabuxiabu was no exception to this. Company and its subsidiaries (the “Group”) for the year Fortunately, we were able to ride on this opportunity to ended 31 December, 2020. respond quickly. When government started to implement the social distancing measures such as restaurants shut down, city lock down, we started to promote more online delivery business giving us the leverage to continue to drive sales. We had also ridden on the opportunity to 6 XIABUXIABU CATERING MANAGEMENT (CHINA) HOLDINGS CO., LTD. Chairman’s Statement donate money and food delivery to support the Wuhan Our condiment business increased significantly in 2020 medical teams to show appreciation for their effort due to the pandemic and many people had to quarantine and establish goodwill for the Company. Despite the at home. Our condiments products which allows people pandemic, the Group continued to follow our expansion to cook a tasty meal even at home had ridden on this foot prints to expand during 2020, we have opened 91 opportunity to take a leap. We have also expanded Xiabuxiabu restaurants and 38 Coucou restaurants and our sales channel into Huadong and Huanan district will continue to roll out the expansion plans into 2021. where sales contributed from online sales had grown as we deployed more online sales channels. As a result, While we continue to focus our efforts to expand the condiments sales increased from 1.5% in 2019 to our market penetration, we also align our restaurants 2.7% in 2020. In 2021, we will continue to roll out branding strategy to ensure our brand is successfully more products and continue to expand the online and targeted to the right customers, in the second half of offline sales channel to expand the brand and product 2020, we have successfully launched several branding penetration into more new areas. campaigns in Shanghai, Shenzhen, Tianjin, where we showcased our new brand image and new restaurants. Delivery business had also taken a strong growth in 2020 We continued to explore ways to improvise the dining as a result of the pandemic outbreak when people had experience at Xiabuxiabu restaurants. to stay in-door. Delivery became a solution to satisfy people’s need of dining. In addition, people tend to take Another key growth driver of the Group was from advantage of the convenience of mobile device, which Coucou. In 2020, Coucou business had grown also led to the strong growth in the delivery business. significantly and continued to be a strong growth engine Through continual product development, increased for the Group. Its upscale operating model featuring a interaction with customers and promotion via small unique dining environment with exquisite ingredients, program, in 2020 the sales from delivery increased by Taiwanese service and the tea house had made a name 21% and the number of orders increased by 15% versus for itself and became a well-liked brand. In 2020, we 2019. Going forward we will continue to introduce have successfully expanded the footprint of Coucou to new products, further develop the small programs to Chengdu, Wenzhou, Zhuhai, Shantou, Xiamen and Hong reach out to a mass number of customers and look Kong and the total number of restaurants increased to for improvisations to improve the delivery packaging to 140 restaurants towards the end of 2020. The sales better present our products to capture bigger market contributed by Coucou from group level in 2020 had share. increased from 20.0% in 2019 to 31.0%. In 2021, we will continue to follow our expansion plan and roll The Group had achieved a great deal in 2020 setting out Coucou brand to more cities within China as well the stage for a fruitful year ahead. We believe 2021 as foreign opportunities abroad to expand the brand will remain challenging as the pandemic is still lingering internationally. around. However, with the vaccine starting to come to the market, we believe we are very close to a recovery and things will be turning around. I would like to take this opportunity to show my utmost appreciation to the management team, the employees for their continued efforts to do their utmost to strive for the success of the Company. I would also like to take this opportunity to thank the board for the vote of confidence and their continued support to help ensure the best corporate governance is being upheld at all times. I am proud to work with you all to overcome the forthcoming challenges in 2021. Ho Kuang-Chi Chairman 2020 ANNUAL REPORT 7 Business Review and Outlook OVERVIEW centrally administered municipalities in China, namely Beijing, Tianjin and Shanghai.