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Public company info - Future Bright Holdings Ltd. , 00703.HK
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Future Bright Holdings Ltd., 00703.HK - Company Profile
Chairman Chan See Kit Johnny
Share Issued (share) 694,000,000
Par Currency Hong Kong Dollar
Par Value 0.1
Industry Restaurants & Fast Food Shops
Corporate Profile Business Summary: The Group, comprising the Company and its subsidiaries, is engaged in the sales of food and catering, food souvenir and property investment. Performance for the year: The turnover of the Group was approximately HK$1,142.3 million for the Year, representing a mild growth of approximately 0.8% as compared to that of 2018 of HK$1,133.3 million. The gross margin (being the Group’s turnover less food costs) of the Group for the Year was about HK$797.0 million, representing a mild increase of approximately 0.5% as compared to that of HK$793.2 million for the year of 2018. The gross margin ratio (being gross margin over turnover) of the Group for the Year was about 69.8%, representing a mild decrease of 0.2% as compared to that of last year of 70.0%. Business Review Food and catering business review Restaurant Chain (self-owned and under franchise) The Group has been subject to tough and challenging operating environment recording losses due to the US and China trade and technology disputes and the civil unrest in Hong Kong in the Year, during which the Group’s restaurant chain business has recorded a loss before non-controlling interests of some HK$22.5 million in the first half of the Year and a loss before non-controlling interests of some HK$156.3 million in the second half of the Year. In the Year, the Group’s food and catering business in Macau has underperformed against the improved level of visitor flow to Macau, and has underperformed against the slight drop in Macau Gross Gaming Revenue, where a total of 39.4 million visitors to Macau have been recorded with an increase of 10.06% and the Macau Gross Gaming Revenue has dropped slightly by 3.5%, as compared to the year of 2018. The results of the Group by geographical segments for the Year have been at a loss of some HK$16.0 million in Macau, a loss of some HK$188.1 million in Mainland China, a loss of some HK$127.8 million in Hong Kong and a loss of some HK$44.9 million in Taiwan. The Group has recorded an overall increase of some 4.9% same store growth in the Year, and the Group has expanded its restaurant and food court operations in Hong Kong reaching a total turnover of some HK$950.1 million with a turnover decrease of some 1.5%, as compared to that of the year of 2018. The Group’s Japanese restaurants have recorded a total turnover of some HK$286.9 million with a drop of some 9.6% in its turnover in the Year, as against its turnover of some HK$317.3 million for the year of 2018. And the Group’s franchise restaurants have in the Year reached a total turnover of some HK$221.4 million with a drop of some 8.9% in its turnover, as compared to some HK$243.0 million for the year of 2018. Management has also, after its expiry in April 2019, partially renewed its franchise–“Pacific Coffee” for its remaining four coffee shops in Macau where their tenancies are still ongoing. During the Year, as a continuous review process of the performance of its restaurants, the Group has closed down 3 restaurants, 2 coffee shops in Macau, Foodium food court in West Kowloon Station in Hong Kong, and 1 restaurant in Mainland China. In the Year, the Group has also converted its Vergnano restaurant at The Venetian in Macau into a Bistro Seoul restaurant. And during the Year, the Group has opened the following restaurants and food court counters: • Bari-Uma ramen restaurant at Breeze Nan Shan, Taiwan; • Mad for Garlic restaurant at Breeze Nan Shan, Taiwan; • Canton Roast at West Kowloon Station, Hong Kong; • Bari-Uma ramen restaurant at Cocopark, Mainland China; • 1 food court counter at Hong Kong International Airport; and • 10 food court counters – Food Playground at K11 Musea, Hong Kong. In the year of 2020, management plans to open a food court at a new hotel complex in Macau, and one Edo Japanese restaurant and another food court at another new hotel complex in Macau. The management also plans to convert its 456 Modern Shanghai Cuisine at The Venetian to Shiki Hot Pot restaurant. Due to its performance being unsatisfactory, management has in mid-March 2020 closed down Canton 12 restaurant in Taipei, one FuUn-Maru restaurant and one Bistro Seoul restaurant in Hong Kong, and the Azores restaurant and Musashi Japanese restaurant in Zhuhai. Management will also by the first half of 2020 close down the Bari-Uma ramen restaurant at Breeze Nan Shan, Taipei, and two Bari-Uma ramen restaurants and one Mad for Garlic restaurant in Hong Kong. Industrial Catering Business In the Year, the Group has operated canteens, restaurants and coffee shops at University of Macau in Hengqin Island, a canteen at International School of Macau and a canteen at Macau University of Science and Technology. The Group’s industrial catering business has attained a total turnover of some HK$40.7 million, being a drop of some 16.4% in the Year, as compared to some HK$48.7 million for the year of 2018. The Group has since June 2019 closed down its canteen “Food Paradise” at University of Macau in Hengqin Island. The Group’s central food and logistic processing centre in Macau has become operational helping to improve the efficiency of the Group’s industrial catering business as well as the production efficiency and quality for the Group’s food souvenir business. Wholesales of Japanese food and materials Business The Group’s wholesale business of Japanese food and materials has improved during the Year with a turnover of some HK$44.7 million, representing a good growth of some 6.4% as compared to the year of 2018. Management will continue to look for opportunities to expand the sales channels of this business both locally and in Zhuhai. The Group’s central food and logistic processing centre in Macau has become operational helping to improve the production efficiency and quality for the Group’s food souvenir business. The Group’s food souvenir business has in the Year recorded a total turnover of some HK$100.7 million with a loss attributable to owners of the Company of some HK$18.1 million (comprising of operation losses of some HK$8.8 million and impairment loss on rightof-use assets of some HK$9.3 million), as against the turnover of some HK$78.4 million with a loss attributable to owners of the Company of some HK$18.7 million for the year of 2018. The increase in turnover of the food souvenir business was mainly due to the increases of turnover from the new Yeng Kee bakery shop at Macau Airport Terminal and from its distribution sales in Mainland China. In the Year, management has closed down 3 Yeng Kee shops in Macau. In the year of 2020, management plans to open a Yeng Kee shop at Lisboeta Macau, and another Yeng Kee shop at another new hotel complex in Macau. To improve its sales, management has continued its policy to expand its sales networks with more stores and kiosks, more online sales platforms, and exploration to identify more distribution agents in Mainland China and overseas countries. Property Investment Business Review The Group has, as previously announced, signed a lease agreement in July 2019 to lease the entire Key Investment Property to an independent third party as tenant for a period of 8 years from commencement of the tenant’s business or end of the rent free period. The tenant has taken possession of the Key Investment Property, and should start to pay rent from April 2020. As previously disclosed in October 2019, the Group has sold to an independent third party, at the cash consideration of RMB300.0 million (equivalent to approximately HK$335.7 million), all its equity interest in and shareholder loans to its wholly own subsidiary in Macau which owns the Hengqin Land. Completion of such disposal took place in December 2019, giving rise to a gross disposal loss of approximately HK$140.6 million. As stated in its circular to Shareholders of 29 November 2019, with substantial cash inflow upon completion of such disposal, the Group intends to use the net sale proceeds of some HK$318.8 million from such disposal as to HK$150.0 million to repay its bank borrowings, as to HK$80.0 million to finance opening of new restaurants/shops for its food and catering business and as to the balance of HK$88.8 million for its working capital, and it is the current intention of the Group that it shall continue to focus on its existing markets without any plan to tap on the food and catering market of Hengqin Island as the economic growth of Hengqin Island is much slower than expected. Prospects: With the signing of the first phase trade agreement between US and China, hopefully the US and China trade relationship may get more stable and steady, while the technology conflict between US and China still continues. Although the civil unrest in Hong Kong since June 2019 has shown signs of slow down, the outbreak of Covid-19 infection since mid-January 2020 in many cities in Mainland China, Macau and Hong Kong, has critically and adversely affected the retail business in Macau, Hong Kong and Mainland China and hence, the Group’s business. With the Group’s temporary close down of most of its restaurants and shops in Macau, Hong Kong and Mainland China for about two weeks in February 2020, it would substantially reduce its revenue contribution in the first quarter of this year, although most of the Group’s restaurants, which have temporarily been closed down in February 2020, are now re-opened with some at limited business hours. The current dire operating environment of the Group is unprecedented. It is currently unable to make any estimation on when Covid-19 infection may be over, and its negative economic impact on those cities the Group has operations, and hence on the Group’s business. Management expects that with Covid-19 infection still hitting hard on China, and then recently on US and Europe, visitors to Hong Kong and Macau will be so adversely affected that the operating environment of the Group in the first three quarters of 2020 will be very tough, and cost savings measures (including rental reduction requests to the relevant landlords) have already been taken to brave this coming storm of the uncertain operating environment of those cities in which the Group is operating. To cope with such challenging circumstances, the Group’s current business strategy is not to open any new restaurants in the Greater China area except for those of which the Group has already committed. Management will also continue to tap on overseas distributors to distribute its food souvenir products in the overseas markets. Management takes this opportunity to thank all of the staffs of the Group for their efforts contributed in keeping the Group moving forward.

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