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Neo-Concept International Group Holdings Ltd

Neo-Concept International Group Holdings LtdNCI财报

Nasdaq · 可选消费 · 服装及其他织物制品和类似材料的成品

Neo-Concept International Group Holdings Ltd operates in the apparel and lifestyle products sector, providing end-to-end solutions covering product design, material sourcing, manufacturing, and logistics support. It serves global brand clients across North America, Europe, and Asia, focusing on mid-to-premium consumer market segments.

What changed in Neo-Concept International Group Holdings Ltd's 20-F — 2023 vs 2024

Top changes in Neo-Concept International Group Holdings Ltd's 2024 20-F

216 paragraphs added · 242 removed · 169 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

38 edited+5 added−10 removed276 unchanged
Senate passed the HFCAA, which includes requirements for the SEC to identify issuers whose audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely because of a restriction imposed by a non-U.S. authority in the auditor’s local jurisdiction. The U.S.
Senate passed the HFCAA, which includes requirements for the SEC to identify issuers whose audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely because of a restriction imposed by a non-U.S. authority in the auditor’s local jurisdiction. The U.S.
If the PCAOB is unable to inspect and investigate completely registered public accounting firms located in China in 2023 and beyond, or if we fail to, among others, meet the PCAOB’s requirements, including retaining a registered public accounting firm that the PCAOB determines it is able to inspect and investigate completely, we will be identified as a “Commission-identified Issuer,” and upon the expiration of the applicable years of non-inspection under the HFCAA and relevant regulations, the Ordinary Shares will be delisted and will not be permitted for trading over the counter.
If the PCAOB is unable to inspect and investigate completely registered public accounting firms located in China in 2023 and beyond, or if we fail to, among others, meet the PCAOB’s requirements, including retaining a registered public accounting firm that the PCAOB determines it is able to inspect and investigate completely, we will be identified as a “Commission-identified Issuer,” and upon the expiration of the applicable years of non-inspection under the HFCAA and relevant regulations, the Class A Ordinary Shares will be delisted and will not be permitted for trading over the counter.
These regulatory agencies may also impose fines and penalties on our operations in China, as well as limit our ability to pay dividends outside of China, limit our operations in China, delay or restrict the repatriation of the proceeds from our IPO or other offerings into China or take other actions that could have a material adverse effect on our business as well as the trading price of our Ordinary Shares.
These regulatory agencies may also impose fines and penalties on our operations in China, as well as limit our ability to pay dividends outside of China, limit our operations in China, delay or restrict the repatriation of the proceeds from our IPO or other offerings into China or take other actions that could have a material adverse effect on our business as well as the trading price of our Class A Ordinary Shares.
However, due to long arm provisions under the current PRC laws and regulations, the Chinese government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could result in a material change in our operations and/or the value of our Ordinary Shares.
However, due to long arm provisions under the current PRC laws and regulations, the Chinese government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares.
In addition, intellectual property protection may be unavailable or limited in the countries in which we operate where laws or law enforcement practices may not protect our intellectual property rights as fully as in the United States, and it may be more difficult for us to successfully challenge the use of our intellectual property rights by other parties in these countries.
Intellectual property protection may be unavailable or limited in the countries in which we operate where laws or law enforcement practices may not protect our intellectual property rights as fully as in the United States, and it may be more difficult for us to successfully challenge the use of our intellectual property rights by other parties in these countries.
If any of our employees has contracted or is suspected of having contracted COVID-19, these employees will be required to be quarantined and they could pass it to other of our employees, potentially resulting in severe disruption to our business. 19 Furthermore, our results of operations have been severely affected by the COVID-19 outbreak.
If any of our employees has contracted or is suspected of having contracted COVID-19, these employees will be required to be quarantined and they could pass it to other of our employees, potentially resulting in severe disruption to our business. 18 Furthermore, our results of operations have been severely affected by the COVID-19 outbreak.
Based on management’s internal assessment that the Company and its subsidiaries currently have no material operations in the PRC, the Management understands that as of the date of this report, the Company is not required to obtain any permissions or approvals from PRC authorities before listing in the U.S. and to issue our Ordinary Shares to foreign investors, including the CAC or the CSRC because (i) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like our IPO are subject to this regulation; and (ii) the Company operates in Hong Kong and is not included in the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC.
Based on management’s internal assessment that the Company and its subsidiaries currently have no material operations in the PRC, the Management understands that as of the date of this report, the Company is not required to obtain any permissions or approvals from PRC authorities before listing in the U.S. and to issue our Class A Ordinary Shares to foreign investors, including the CAC or the CSRC because (i) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like our IPO are subject to this regulation; and (ii) the Company operates in Hong Kong and is not included in the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC.
With the internet becoming more common in the current economic environment, market demand for our services may decrease. 15 Any negative publicity about our products or services could harm our business and reputation and could materially adversely affect our financial condition and results of operations.
With the internet becoming more common in the current economic environment, market demand for our services may decrease. Any negative publicity about our products or services could harm our business and reputation and could materially adversely affect our financial condition and results of operations.
Because we will be a “controlled company” the terms of such future transactions will be reviewed by the Audit Committee to ensure that they will not be less favorable to us than would be the case if they were negotiated with unaffiliated third parties.
Because we are a “controlled company” the terms of such future transactions will be reviewed by the Audit Committee to ensure that they will not be less favorable to us than would be the case if they were negotiated with unaffiliated third parties.
The Chinese government may intervene or influence our operations at any time and may exert more control over offerings conducted overseas and foreign investment in China-based issuers, which may result in a material change in our operations and/or the value of our Ordinary Shares.
The Chinese government may intervene or influence our operations at any time and may exert more control over offerings conducted overseas and foreign investment in China-based issuers, which may result in a material change in our operations and/or the value of our Class A Ordinary Shares.
As a result, our business, financial condition, results of operations and prospects, as well as the market for and trading price of our Ordinary Shares, may be materially and adversely affected if we do not have effective internal controls.
As a result, our business, financial condition, results of operations and prospects, as well as the market for and trading price of our Class A Ordinary Shares, may be materially and adversely affected if we do not have effective internal controls.
We may not discover any problems in a timely manner and in such an event our shareholders could lose confidence in our financial reporting, which would harm our business and the trading price of our Ordinary Shares.
We may not discover any problems in a timely manner and in such an event our shareholders could lose confidence in our financial reporting, which would harm our business and the trading price of our Class A Ordinary Shares.
To the extent any new or more stringent measures are implemented, our business, financial condition and results of operations could be adversely affected, and the value of our Ordinary Shares could decrease or become worthless. 6 If the Chinese government chooses to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.
To the extent any new or more stringent measures are implemented, our business, financial condition and results of operations could be adversely affected, and the value of our Class A Ordinary Shares could decrease or become worthless. 6 If the Chinese government chooses to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Class A Ordinary Shares to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless.
The concentration of ownership and voting power may cause transactions to occur in a way that may not be beneficial to you as a holder of our Ordinary Shares and may prevent us from doing transactions that would be beneficial to you.
The concentration of ownership and voting power may cause transactions to occur in a way that may not be beneficial to you as a holder of our Class A Ordinary Shares and may prevent us from doing transactions that would be beneficial to you.
Senate passed the Accelerating Holding Foreign Companies Accountable Act, enacted on December 23, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time before our Ordinary Shares may be prohibited from trading or delisted.
Senate passed the Accelerating Holding Foreign Companies Accountable Act, enacted on December 23, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time before our Class A Ordinary Shares may be prohibited from trading or delisted.
Senate passed the AHFCAA, which was enacted on December 23, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus, reducing the time before our Ordinary Shares may be prohibited from trading or delisted.
Senate passed the AHFCAA, which was enacted on December 23, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus, reducing the time before our Class A Ordinary Shares may be prohibited from trading or delisted.
Such a delisting or prohibition would substantially impair your ability to sell or purchase the Ordinary Shares, and the risk and uncertainty associated with delisting would have a negative impact on the price of the Ordinary Shares.
Such a delisting or prohibition would substantially impair your ability to sell or purchase the Class A Ordinary Shares, and the risk and uncertainty associated with delisting would have a negative impact on the price of the Class A Ordinary Shares.
If we fail to protect and maintain our intellectual property rights, the value of our brand could be diminished, and our competitive position may suffer. 16 We are exposed to credit risks of our customers. We are exposed to credit risks of our customers.
If we fail to protect and maintain our intellectual property rights, the value of our brand could be diminished, and our competitive position may suffer. We are exposed to credit risks of our customers. We are exposed to credit risks of our customers.
During the years ended December 31, 2023, 2022 and 2021 our two contract manufacturers together accounted for 93.9%, 80.1% and 100% of our total purchases, respectively. We engage contract manufacturer on an individual project basis and rely on third party service providers for services including sourcing of materials and provision of logistics services for the finished goods.
During the years ended December 31, 2024, 2023 and 2022 our two contract manufacturers together accounted for 100%, 93.9% and 80.1% of our total purchases, respectively. We engage contract manufacturer on an individual project basis and rely on third party service providers for services including sourcing of materials and provision of logistics services for the finished goods.
It is difficult to predict the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us. Furthermore, legislative, or administrative actions in respect of China-U.S. relations could cause investor uncertainty for affected issuers, including us, and the market price of our Ordinary Shares could be adversely affected.
It is difficult to predict the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us. Furthermore, legislative, or administrative actions in respect of China-U.S. relations could cause investor uncertainty for affected issuers, including us, and the market price of our Class A Ordinary Shares could be adversely affected.
We may be required to restructure our operations to comply with such regulations or potentially cease operations in the PRC entirely. The CSRC, the CAC or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt our future offerings before settlement and delivery of our Ordinary Shares.
We may be required to restructure our operations to comply with such regulations or potentially cease operations in the PRC entirely. The CSRC, the CAC or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt our future offerings before settlement and delivery of our Class A Ordinary Shares.
If we are not able to control our costs and/or pass on such additional costs to our customers or allocate such production work to other suppliers of similar quality at comparable terms, our profit margin could decrease, and we could record losses in some of our projects. 17 We face keen competition from other players in the market.
If we are not able to control our costs and/or pass on such additional costs to our customers or allocate such production work to other suppliers of similar quality at comparable terms, our profit margin could decrease, and we could record losses in some of our projects. 16 We face keen competition from other players in the market.
Under the HFCAA, our securities may be prohibited from trading on the Nasdaq or other U.S. stock exchanges if our auditor is not inspected by the PCAOB for three consecutive years, and this ultimately could result in our Ordinary Shares being delisted. On June 22, 2021, the U.S.
Under the HFCAA, our securities may be prohibited from trading on the Nasdaq or other U.S. stock exchanges if our auditor is not inspected by the PCAOB for three consecutive years, and this ultimately could result in our Class A Ordinary Shares being delisted. On June 22, 2021, the U.S.
Our lack of effective internal controls over financial reporting may affect our ability to accurately report our financial results or prevent fraud which may affect the market for and price of our Ordinary Shares. Our independent registered public accounting firm is currently not required to conduct an audit of our internal control over financial reporting.
Our lack of effective internal controls over financial reporting may affect our ability to accurately report our financial results or prevent fraud which may affect the market for and price of our Class A Ordinary Shares. Our independent registered public accounting firm is currently not required to conduct an audit of our internal control over financial reporting.
In the course of auditing our consolidated financial statements as of December 31, 2023, our management has not received from our independent registered public accounting firm any report regarding deficiencies in our internal controls over financial reporting. As a small-scale company, we are in the process of establishing and improving our internal controls.
In the course of auditing our consolidated financial statements as of December 31, 2024, our management has not received from our independent registered public accounting firm any report regarding deficiencies in our internal controls over financial reporting. As a small-scale company, we are in the process of establishing and improving our internal controls.
The absence of internal controls over financial reporting may inhibit investors from purchasing our Ordinary Shares and may make it more difficult for us to raise funds in debt or equity financing. Additional material weaknesses or significant deficiencies may be identified in the future.
The absence of internal controls over financial reporting may inhibit investors from purchasing our Class A Ordinary Shares and may make it more difficult for us to raise funds in debt or equity financing. Additional material weaknesses or significant deficiencies may be identified in the future.
If Neo-Concept HK is deemed an “operator of critical information infrastructure” or an “online platform operator” as defined in the Review Measures 2021, Neo-Concept HK’s operation and the listing of our Ordinary Shares in the U.S. could be subject to CAC’s cybersecurity review in the future.
If Neo-Concept HK is deemed an “operator of critical information infrastructure” or an “online platform operator” as defined in the Review Measures 2021, Neo-Concept HK’s operation and the listing of our Class A Ordinary Shares in the U.S. could be subject to CAC’s cybersecurity review in the future.
If we become subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed China-based companies, we may have to expend significant resources to investigate and/or defend the matter which could harm our business operations, any future offerings and our reputation and could result in a loss of your investment in our ordinary shares, in particular if such matter cannot be addressed and resolved favorably.
If we become subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed China-based companies, we may have to expend significant resources to investigate and/or defend the matter which could harm our business operations, any future offerings and our reputation and could result in a loss of your investment in our Class A Ordinary SharesShares, in particular if such matter cannot be addressed and resolved favorably.
Prolonged unrest, intensified military activities, or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on the operations, results of operations, financial condition, liquidity, and business outlook of our business. 20
Prolonged unrest, intensified military activities, or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on the operations, results of operations, financial condition, liquidity, and business outlook of our business. 19
In addition, our failure to back up our data and information in a timely manner may cause material disruption of our business operation and may therefore adversely affect our business and results of operations. 18 We may be unable to successfully implement our future business plans and objectives.
In addition, our failure to back up our data and information in a timely manner may cause material disruption of our business operation and may therefore adversely affect our business and results of operations. 17 We may be unable to successfully implement our future business plans and objectives.
Moreover, the HFCAA or other efforts to increase U.S. regulatory access to audit information could cause investor uncertainty for affected issuers, including us, and the market price of the Ordinary Shares could be adversely affected.
Moreover, the HFCAA or other efforts to increase U.S. regulatory access to audit information could cause investor uncertainty for affected issuers, including us, and the market price of the Class A Ordinary Shares could be adversely affected.
Our Controlling Shareholder has significant voting power and may take actions that may not be in the best interests of other shareholders. Our Controlling Shareholder, owns 71.5% of the total issued and outstanding Ordinary Shares, representing 71.5% of the total voting power.
Our Controlling Shareholder has significant voting power and may take actions that may not be in the best interests of other shareholders. Our Controlling Shareholder, owns 71.5% of the total issued and outstanding Ordinary Shares, representing 84.64% of the total voting power.
We rely on two principal suppliers for supplies of raw materials, manufacturing services and logistics services. The apparel products sold or sourced by us during the years ended December 31, 2022, 2022 and 2021, were mainly produced by two contract manufacturers, one of which is our affiliated company.
We rely on two principal suppliers for supplies of raw materials, manufacturing services and logistics services. The apparel products sold or sourced by us during the years ended December 31, 2024, 2023 and 2022, were mainly produced by two contract manufacturers, one of which is our affiliated company.
ITEM 3. KEY INFORMATION B. Capitalization and Indebtedness. Not applicable. C. Reason for the Offer and Use of Proceeds. Not applicable. D. Risk Factors. You should carefully consider all the information in this Annual Report, including various changing regulatory, competitive, economic, political and social risks and conditions described below, before making an investment in our ordinary shares.
ITEM 3. KEY INFORMATION B. Capitalization and Indebtedness. Not applicable. C. Reason for the Offer and Use of Proceeds. Not applicable. D. Risk Factors. You should carefully consider all the information in this Annual Report, including various changing regulatory, competitive, economic, political and social risks and conditions described below, before making an investment in our Class A Ordinary SharesShares.
We may have conflicts of interest with our Controlling Shareholder, because of our Controlling Shareholder’s controlling ownership interest in our Company, we may not be able to resolve such conflicts on terms favorable to us. Our Controlling Shareholder beneficially owns 71.5% of our outstanding ordinary shares and total voting power.
We may have conflicts of interest with our Controlling Shareholder, because of our Controlling Shareholder’s controlling ownership interest in our Company, we may not be able to resolve such conflicts on terms favorable to us. Our Controlling Shareholder beneficially owns 71.5% of our outstanding Ordinary Shares and 84.64% of the total voting power.
In any such case, the market price of our ordinary shares could decline, and you may lose all or part of your investments. 1 Risks Relating to Our Corporate Structure Our transactions with NCH may be less favorable to us than similar agreements negotiated with unaffiliated third parties.
In any such case, the market price of our Class A Ordinary Shares Ordinary Sharescould decline, and you may lose all or part of your investments. 1 Risks Relating to Our Corporate Structure Our transactions with NCH may be less favorable to us than similar agreements negotiated with unaffiliated third parties.
Delisting of our Ordinary Shares would force holders of our Ordinary Shares to sell their Ordinary Shares. The market price of our Ordinary Shares could be adversely affected as a result of anticipated negative impacts of these executive or legislative actions upon, regardless of whether these executive or legislative actions are implemented and regardless of our actual operating performance.
The market price of our Class A Ordinary Shares could be adversely affected as a result of anticipated negative impacts of these executive or legislative actions upon, regardless of whether these executive or legislative actions are implemented and regardless of our actual operating performance.
Any incidents involving our company, our suppliers or manufacturers, or the products we sell, could erode the trust and confidence of our customers, and damage the strength of our brand, especially if such incidents result in adverse publicity, governmental investigations, product recalls or litigation.
Any incidents involving our company, our suppliers or manufacturers, or the products we sell, could erode the trust and confidence of our customers, and damage the strength of our brand, especially if such incidents result in adverse publicity, governmental investigations, product recalls or litigation. 15 We cannot guarantee that we are able to protect or enforce our intellectual property rights of the “les 100 ciels” trademark that would have a material adverse effect on our business and operations.
Removed
We recorded net current liabilities and a total deficit for three years ended December 31, 2023, 2022 and 2021, and may continue to record net current liabilities and a total deficit in the foreseeable future, which can expose us to liquidity risks.
Added
Our dual-class voting structure will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class B ordinary shares may view as beneficial. We have a dual-class voting structure consisting of Class A ordinary shares and Class B ordinary shares.
Removed
We had net current liabilities of HKD6,088,795 (US$779,524), HKD61,288,133 (US$7,855,942) and HKD75,547,697 as of December 31, 2023,2022 and 2021, respectively. We also had total deficits of HKD2,386,810 (US$305,572), HKD60,675,596 (US$7,777,427) and HKD75,590,274 as of December 31, 2023, 2022 and 2021, respectively.
Added
Based on our dual-class voting structure, holders of Class A ordinary shares will be entitled to one (1) vote per share in respect of matters requiring the votes of shareholders, while holders of Class B ordinary shares will be entitled to thirty (30) votes per share.
Removed
Although we recorded net income of HKD4,414,733 (US$565,202), HKD12,400,516 (US$1,589,505) and HKD5,450,515 for the years ended December 31, 2023, 2022 and 2021, we cannot assure you that we will be able to continue to generate net income in the future.
Added
Due to the disparate voting powers associated with our two classes of ordinary shares, our Controlling Shareholder, Ms. Eva Yuk Yin Siu, beneficially owns 11,895,055 Class A Ordinary Shares and 2,631,300 Class B Ordinary Shares, which represents 71.5% of the total issued and outstanding Shares.
Removed
We anticipate that our operating cost and expenses will increase in the foreseeable future as we continue to grow our business. Our efforts to grow our business may prove more costly than we currently anticipate, and we may not succeed in increasing our revenue sufficiently to offset these higher expenses.
Added
Their interests may not coincide with your interests, and they may make decisions with which you disagree, including decisions on important topics such as the composition of the board of directors, compensation, management succession, and our business and financial strategy.
Removed
We cannot assure you that we will not incur net current liabilities in the future. A net current liabilities position can expose us to the risk of shortfalls in liquidity, in which case our ability to raise funds, obtain bank loans and declare and pay dividends will be materially and adversely affected.
Added
Delisting of our Class A Ordinary Shares would force holders of our Class A Ordinary Shares to sell their Class A Ordinary Shares.
Removed
Our profitability and liquidity position is dependent on, among other factors, our ability to grow our business and extend our product offering to existing customers and expand our customer base. Any material decrease in our service fees would have a substantial impact on our margin.
Removed
As a result of the foregoing and other factors, our net income may decline, or we may incur net losses in the future and be unable to achieve or maintain profitability and improve our liquidity position.
Removed
We cannot guarantee that our right to use the brand “les 100 ciels” trademark will not be revoked and the loss of or our failure to protect or enforce our intellectual property rights would have a material adverse effect on our business and operations.
Removed
We are currently licensed to use the brand name “ les 100 ciels ” trademark from affiliate companies of our Controlling Shareholder under a fixed term license agreement valid until December 31, 2026, with an option to renew for a further period of five years.
Removed
However, we cannot guarantee that such license would not be revoked in the future and the loss of such licenses or inability to use these brands would have a material adverse effect on our business and operations.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

31 edited+6 added−3 removed140 unchanged
Neo-Concept UK is also subject to various other statutes which apply with respect to its employment arrangements in England and Wales, including (a) Working Time Regulations 1998 which covers matters such as holiday and holiday pay, working hours and rest breaks; (b) Fixed Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 which covers treatment of fixed term employees; (c) Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2002 which covers treatment of part-time workers; (d) Equality Act 2010 which provides protection against unlawful discrimination in employment; (e) Health and Safety at Work Act 1974 which covers occupational health and safety; (f) Transfer of Undertakings (Protection of Employment) Regulations 2006 which, amongst other things, provides restrictions on varying terms and conditions of employment in connection with a transfer; (g) Trade Union and Labour Relations (Consolidation) Act 1992 which, amongst other things, provides for consultation requirements in respect of collective dismissals; (h) National Minimum Wage Act 1998 which implements a minimum hourly rate of pay set by the government that applies to all workers over compulsory school leaving age; and (i) Copyright, Designs and Patents Act 1988 and Patents Act 1977, which together create a statutory framework for employers to own the inventions and literary work made or created by their employees in the course of their employment. 34 C.
Neo-Concept UK is also subject to various other statutes which apply with respect to its employment arrangements in England and Wales, including (a) Working Time Regulations 1998 which covers matters such as holiday and holiday pay, working hours and rest breaks; (b) Fixed Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 which covers treatment of fixed term employees; (c) Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2002 which covers treatment of part-time workers; (d) Equality Act 2010 which provides protection against unlawful discrimination in employment; (e) Health and Safety at Work Act 1974 which covers occupational health and safety; (f) Transfer of Undertakings (Protection of Employment) Regulations 2006 which, amongst other things, provides restrictions on varying terms and conditions of employment in connection with a transfer; (g) Trade Union and Labour Relations (Consolidation) Act 1992 which, amongst other things, provides for consultation requirements in respect of collective dismissals; (h) National Minimum Wage Act 1998 which implements a minimum hourly rate of pay set by the government that applies to all workers over compulsory school leaving age; and (i) Copyright, Designs and Patents Act 1988 and Patents Act 1977, which together create a statutory framework for employers to own the inventions and literary work made or created by their employees in the course of their employment. 33 C.
D. Property, plant and equipment. We do not own any real property. Our principal executive office is located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong. The office has a size of approximately 10,700 square feet. We lease our office in Hong Kong from our affiliated company, NCH.
Property, plant and equipment. We do not own any real property. Our principal executive office is located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong. The office has a size of approximately 10,700 square feet. We lease our office in Hong Kong from our affiliated company, NCH.
There are no prohibitions to cumulative voting under the laws of the Cayman Islands, but our Memorandum and Articles of Association do not provide for cumulative voting. 35 Exclusive Territory and Non-Competition Agreement NCH also operates as a comprehensive apparel solutions services provider in North America and Europe principally.
There are no prohibitions to cumulative voting under the laws of the Cayman Islands, but our Memorandum and Articles of Association do not provide for cumulative voting. Exclusive Territory and Non-Competition Agreement NCH also operates as a comprehensive apparel solutions services provider in North America and Europe principally.
At each general meeting, each shareholder who is present in person or by proxy (or, in the case of a shareholder being a corporation, by its duly authorized representative) will have one vote for each Ordinary Share which such shareholder holds.
At each general meeting, each shareholder who is present in person or by proxy (or, in the case of a shareholder being a corporation, by its duly authorized representative) will have one vote for each Class A Ordinary Share which such shareholder holds.
The legislation requires those entities subject to it to give specific types of information and notices to data subjects (which will include customers, suppliers and its own staff) and in some cases seek consent from such data subjects before collecting or using their data for certain purposes, including but not limited to some marketing activities. 33 Electronic Communications The Privacy and Electronic Communications Regulations 2003 (“PECR”) impose obligations on businesses with regard to any electronic communications with UK consumers.
The legislation requires those entities subject to it to give specific types of information and notices to data subjects (which will include customers, suppliers and its own staff) and in some cases seek consent from such data subjects before collecting or using their data for certain purposes, including but not limited to some marketing activities. 32 Electronic Communications The Privacy and Electronic Communications Regulations 2003 (“PECR”) impose obligations on businesses with regard to any electronic communications with UK consumers.
As part of our sustainability efforts, we monitor the market to identify new innovative materials and processes that can help to reduce the environmental footprint of our production, whether it be carbon emissions, water consumption or waste pollution. 27 For example, by adopting processes such as the Dry Dye™ (also known as ZERO-D® dyeing solution) we can achieve a water-based printing solution for a number of our textiles with zero polluted water discharge and reduction of water usage by over 99%.
As part of our sustainability efforts, we monitor the market to identify new innovative materials and processes that can help to reduce the environmental footprint of our production, whether it be carbon emissions, water consumption or waste pollution. 26 For example, by adopting processes such as the Dry Dye™ (also known as ZERO-D® dyeing solution) we can achieve a water-based printing solution for a number of our textiles with zero polluted water discharge and reduction of water usage by over 99%.
The Agreement also provides for a non-solicitation obligation so that NCH may not, during the non-competition period, hire, or solicit for hire, any active employees of, or individuals providing consulting services to NCI or its subsidiaries, or any former employees of, or individuals providing consulting services to NCI or its subsidiaries within six months of the termination of their employment or consulting services, without NCI’s consent, except for solicitation activities through generalized non-targeted advertisement not directed to such employees or individuals that do not result in a hiring within the non-competition period.
The Agreement also provides for a non-solicitation obligation so that NCH may not, during the non-competition period, hire, or solicit for hire, any active employees of, or individuals providing consulting services to NCI or its subsidiaries, or any former employees of, or individuals providing consulting services to NCI or its subsidiaries within six months of the termination of their employment or consulting services, without NCI’s consent, except for solicitation activities through generalized non-targeted advertisement not directed to such employees or individuals that do not result in a hiring within the non-competition period. 35 D.
We will continue to broaden the range of apparel products handled by us and strengthen our design and development capabilities in different categories, so that we can tap into new markets and attract new customers. 24 Acquisition of companies and/or formation of joint ventures We intend to acquire stakes in companies and/or forming joint ventures with potential business partners, with a view to support the business growth of our Group and diversify our revenue sources.
We will continue to broaden the range of apparel products handled by us and strengthen our design and development capabilities in different categories, so that we can tap into new markets and attract new customers. 23 Acquisition of companies and/or formation of joint ventures We intend to acquire stakes in companies and/or forming joint ventures with potential business partners, with a view to support the business growth of our Group and diversify our revenue sources.
Our apparel products sold under the “les 100 ciels” brand consists mainly of knitwear made from cashmere. les 100 ciels womenswear 28 By selling direct to consumer we can also avoid the costs associated with traditional wholesalers, creating a more efficient cost structure and higher gross margin, which we believe allows us to deliver more affordable products and a better experience to customers.
Our apparel products sold under the “les 100 ciels” brand consists mainly of knitwear made from cashmere. les 100 ciels womenswear 27 By selling direct to consumer we can also avoid the costs associated with traditional wholesalers, creating a more efficient cost structure and higher gross margin, which we believe allows us to deliver more affordable products and a better experience to customers.
Customers are provided with solutions along the supply chain in an efficient and cost-effective manner, so they are able to prioritize their own core competencies and business objectives. 23 Our management members have deep industry knowledge and proven track records Our management members bring with them an average of over 30 years of experience in the apparel industry having co-founded NCH in 1990.
Customers are provided with solutions along the supply chain in an efficient and cost-effective manner, so they are able to prioritize their own core competencies and business objectives. 22 Our management members have deep industry knowledge and proven track records Our management members bring with them an average of over 30 years of experience in the apparel industry having co-founded NCH in 1990.
This standard is used to track the wool used in our products through the chain of custody in order to preserve the identity of the material and its movements through our supply chain up to the final product. 22 Given the recent emphasis on climate change and sustainability, green brands are thriving, and more retailers are incorporating sustainable practices into their production.
This standard is used to track the wool used in our products through the chain of custody in order to preserve the identity of the material and its movements through our supply chain up to the final product. 21 Given the recent emphasis on climate change and sustainability, green brands are thriving, and more retailers are incorporating sustainable practices into their production.
Access to the BCP allows organizations to participate electronically in the Better Cotton Chain of Custody by recording information about cotton-containing orders sourced as Better Cotton, managing the required documentation, and recording information about cotton-containing sales to customers. 26 We have quality control procedures in place to evaluate the performance of raw materials used by our contract manufacturers throughout the production process.
Access to the BCP allows organizations to participate electronically in the Better Cotton Chain of Custody by recording information about cotton-containing orders sourced as Better Cotton, managing the required documentation, and recording information about cotton-containing sales to customers. 25 We have quality control procedures in place to evaluate the performance of raw materials used by our contract manufacturers throughout the production process.
Our retail sales of branded products are also priced based a cost-plus pricing model. 29 PRODUCT RETURN Sales of private-labelled apparel products We do not have a product return or warranty policy for our finished garments. Customers have the right to inspect the finished goods before delivery for defects and deviation from specifications.
Our retail sales of branded products are also priced based a cost-plus pricing model. 28 PRODUCT RETURN Sales of private-labelled apparel products We do not have a product return or warranty policy for our finished garments. Customers have the right to inspect the finished goods before delivery for defects and deviation from specifications.
Our focus on sustainable practices, innovative materials and products, and collaborative partnerships with core customers allows us to successfully compete in the industry. 30 COVID-19 Update Since late December 2019, the outbreak of a novel strain of coronavirus, later named COVID-19, spread rapidly throughout China and later to the rest of the world.
Our focus on sustainable practices, innovative materials and products, and collaborative partnerships with core customers allows us to successfully compete in the industry. 29 COVID-19 Update Since late December 2019, the outbreak of a novel strain of coronavirus, later named COVID-19, spread rapidly throughout China and later to the rest of the world.
As of the date of this report, Neo-Concept HK holds a valid business registration certificate. 31 Regulations related to employment and labor protection Employment Ordinance (Chapter 57 of the Laws of Hong Kong) The Employment Ordinance (Chapter 57 of the Laws of Hong Kong), or the EO, is an ordinance enacted for, amongst other things, the protection of the wages of employees and the regulation of the general conditions of employment and employment agencies.
As of the date of this report, Neo-Concept HK holds a valid business registration certificate. 30 Regulations related to employment and labor protection Employment Ordinance (Chapter 57 of the Laws of Hong Kong) The Employment Ordinance (Chapter 57 of the Laws of Hong Kong), or the EO, is an ordinance enacted for, amongst other things, the protection of the wages of employees and the regulation of the general conditions of employment and employment agencies.
Our seasonal business plan usually involves strategic procurement of raw materials, especially natural fibers, and creation of design sketches responsive to consumer preferences for the season. 25 Product Design and Development We have an in-house design team with in-depth technical apparel know-how and experience in the fashion industry.
Our seasonal business plan usually involves strategic procurement of raw materials, especially natural fibers, and creation of design sketches responsive to consumer preferences for the season. 24 Product Design and Development We have an in-house design team with in-depth technical apparel know-how and experience in the fashion industry.
The six Data Protection Principles are: ● Principle 1 — purpose and manner of collection of personal data; ● Principle 2 — accuracy and duration of retention of personal data; ● Principle 3 — use of personal data; ● Principle 4 — security of personal data; ● Principle 5 — information to be generally available; and ● Principle 6 — access to personal data. 32 Non-compliance with a Data Protection Principle may lead to a complaint to the Privacy Commissioner for Personal Data (the “Privacy Commissioner”).
The six Data Protection Principles are: ● Principle 1 — purpose and manner of collection of personal data; ● Principle 2 — accuracy and duration of retention of personal data; ● Principle 3 — use of personal data; ● Principle 4 — security of personal data; ● Principle 5 — information to be generally available; and ● Principle 6 — access to personal data. 31 Non-compliance with a Data Protection Principle may lead to a complaint to the Privacy Commissioner for Personal Data (the “Privacy Commissioner”).
SUPPLIERS We have two principal suppliers, (i) NCH, an affiliated company controlled by our Controlling Shareholder, and (ii) an independent third party based in Hong Kong with manufacturing facilities in Mainland China, which we have engaged to produce the majority of apparel products for and arrange delivery to our customers during the years ended December 31, 2023, 2022 and 2021.
SUPPLIERS We have two principal suppliers, (i) NCH, an affiliated company controlled by our Controlling Shareholder, and (ii) an independent third party based in Hong Kong with manufacturing facilities in Mainland China, which we have engaged to produce the majority of apparel products for and arrange delivery to our customers during the years ended December 31, 2024, and 2023.
For the years ended December 31, 2023, 2022 and 2021, we are not aware of any material claims against us in relation to defective products, nor any material product returns from our customers. MARKETING We implement a number of marketing and promotion measures to source new customers.
For the years ended December 31, 2024 and 2023, we are not aware of any material claims against us in relation to defective products, nor any material product returns from our customers. MARKETING We implement a number of marketing and promotion measures to source new customers.
We have a particularly strong customer base in Canada and the U.S. which accounts for over 94% of total revenues, and we maintain stable and ongoing business relationships with all our major customers.
We have a particularly strong customer base in Canada and the U.S. which accounts for over 86.98% of total revenues, and we maintain stable and ongoing business relationships with all our major customers.
We selected these suppliers due to their performance based on a pre-defined set of criteria, including size, quality, reputation, price, and on-time delivery records. For the years ended December 31, 2023, 2022 and 2021 our two principal suppliers together accounted for 93.9%, 80.1% and 100% of our total purchases, respectively.
We selected these suppliers due to their performance based on a pre-defined set of criteria, including size, quality, reputation, price, and on-time delivery records. For the years ended December 31, 2024 and 2023 our two principal suppliers together accounted for 100% and 93.9% of our total purchases, respectively.
SEASONALITY The apparel market exhibits seasonality with dynamic changes in trends and consumers’ preferences depending on the time of year. Apparel sales are generally highest from August to December, mainly attributable to climate and frequent online sales events during these months.
SEASONALITY The apparel market exhibits seasonality with dynamic changes in trends and consumers’ preferences depending on the time of year. Apparel sales are generally highest from July to September, mainly attributable to climate and frequent online sales events during these months.
Our top customer is a Canadian based retailer listed on the Toronto Stock Exchange which contributed approximately 71.3%, 91.4% and 94.5% of our revenue for the years ended December 31, 2023, 2022 and 2021, respectively. Neo-Concept HK has been providing our apparel solution services to our top customer since 2012.
Our top customer is a Canadian based retailer listed on the Toronto Stock Exchange which contributed approximately 49.05% and 71.3% of our revenue for the years ended December 31, 2024 and 2023, respectively. Neo-Concept HK has been providing our apparel solution services to our top customer since 2012.
The chart below illustrates our corporate structure and identifies our subsidiaries as of the date of this report: Name Background Ownership Neo-Concept Apparel Group Limited (“NCA”) - A BVI company - Incorporated in August 2008 - Issued Share Capital of US$100 - Intermediate holding company 100% owned by NCI Neo-Concept International Company Limited (“Neo-Concept HK”) - A Hong Kong company - Incorporated in October 1992 - Issued Share Capital of HKD 100,000 - Provision of one-stop apparel solution services 100% owned by NCA Neo-Concept (UK) Limited (“Neo-Concept UK”) - A UK company - Incorporated in August 2000 - Issued Share Capital of GBP100 - Provision of online and offline retail sales of apparel products 100% owned by Neo-Concept HK We are a “controlled company” as defined under the Nasdaq Stock Market Rules because our Controlling Shareholder owns 71.5% of our total issued and outstanding Ordinary Shares, representing 71.5% of the total voting power.
The chart below illustrates our corporate structure and identifies our subsidiaries as of the date of this report: Name Background Ownership Neo-Concept Apparel Group Limited (“NCA”) - A BVI company - Incorporated in August 2008 - Issued Share Capital of US$100 - Intermediate holding company 100% owned by NCI Neo-Concept International Company Limited (“Neo-Concept HK”) - A Hong Kong company - Incorporated in October 1992 - Issued Share Capital of HKD 100,000 - Provision of one-stop apparel solution services 100% owned by NCA Neo-Concept (UK) Limited (“Neo-Concept UK”) - A UK company - Incorporated in August 2000 - Issued Share Capital of GBP100 - Provision of online and offline retail sales of apparel products 100% owned by Neo-Concept HK Neo-Concept Exquisite Couture Limited (“NCEC”) - A BVI company - Incorporated in May 2024 - Issued Share Capital of US$100 - Intermediate holding company 100% owned by NCA Neo Concept Elite Fashion Company L.L.C.
We have also focused on creating a cleaner and more ethical process for the production of our cashmere products. We require our cashmere fibers to be sourced from ethical farms in Inner Mongolia and for each step in the production to be documented for maximum transparency amidst growing concerns of worker abuse.
We require our cashmere fibers to be sourced from ethical farms in Inner Mongolia and for each step in the production to be documented for maximum transparency amidst growing concerns of worker abuse. To reduce chemical dyeing and clean water consumption in our processes, we also advocate for the use of recycled cashmere and undyed cashmere.
Neo-Concept (NY) Corporation, a wholly owned subsidiary of Neo-Concept HK, had no significant operations during the two years ended December 31, 2020, and 2021 and on November 12, 2021, Neo-Concept HK disposed of all the shares of Neo-Concept (NY) Corporation to Neo-Concept (BVI) Limited, an affiliated company controlled by the Controlling Shareholder. 21 Neo-Concept International Group Holdings Limited’s Offices Our principal executive office is located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong.
Neo-Concept (NY) Corporation, a wholly owned subsidiary of Neo-Concept HK, had no significant operations during the two years ended December 31, 2020, and 2021 and on November 12, 2021, Neo-Concept HK disposed of all the shares of Neo-Concept (NY) Corporation to Neo-Concept (BVI) Limited, an affiliated company controlled by the Controlling Shareholder.
We currently lease three retail shops in London, UK, totaling approximately 3,000 square feet and an office with a size of approximately 700 square feet.
We currently lease five retail shops in London, UK, totaling approximately 4,100 square feet, a retail shop in Abu Dhabi, the United Arabs Emirates totaling approximately 1,969 square feet and an office with a size of approximately 700 square feet.
Wai, have decades of experience creating sustainable apparel which we believe sets us apart and grants us unique expertise in the apparel services industry. We have a strong commitment to sustainable practices. For example, we require raw material suppliers to implement clean and ethical processes for sourcing and producing natural fibers such as merino wool and cashmere.
We have a strong commitment to sustainable practices. For example, we require raw material suppliers to implement clean and ethical processes for sourcing and producing natural fibers such as merino wool and cashmere. We have also focused on creating a cleaner and more ethical process for the production of our cashmere products.
The rental was included in management fee charged to us for the years ended December 31, 2021 while for the year ended December 31, 2022, we entered into official rental agreement for the premises and accounted for the relevant cost as rental expense. See “Related Party Transactions” for details.
We entered into official rental agreement for the premises and accounted for the relevant cost as rental expense. See “Related Party Transactions” for details.
This surge in sales can be mainly attributed to increased demand for spring and summer products from our top customer. COMPETITION The industry in which we operate is large, fragmented and highly competitive. We face fierce competition among service providers in terms of the product design, price, quality control and delivery of products.
The aggregate sales generated in these months accounted for approximately 49.58% of our total revenue for the year ended December 31, 2024. COMPETITION The industry in which we operate is large, fragmented and highly competitive. We face fierce competition among service providers in terms of the product design, price, quality control and delivery of products.
In 2000, Neo-Concept UK began to sell apparel products in the UK under the licensed brand “ les 100 ciel ” through its retail stores. Our Competitive Strengths We believe that the following strengths distinguish us from our competitors and have contributed to our success: A focus on sustainability Our founders, Ms. Siu and Ms.
Our Competitive Strengths We believe that the following strengths distinguish us from our competitors and have contributed to our success: A focus on sustainability Our founders, Ms. Siu and Ms. Wai, have decades of experience creating sustainable apparel which we believe sets us apart and grants us unique expertise in the apparel services industry.
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To reduce chemical dyeing and clean water consumption in our processes, we also advocate for the use of recycled cashmere and undyed cashmere.
Added
Share re-designation and Share Consolidation On March 3, 2025, the shareholders of the Company resolved and approved the following resolutions: a) the authorized share capital of the Company shall be re-classified by re-classifying 780,000,000 shares of a par value of US$0.0000625 each as 780,000,000 class A ordinary shares of a par value of US$0.0000625 each (the “Class A Shares”, each such share carrying one (1) vote per share with all rights, restrictions and privileges remaining identical to the existing shares of the Company) and 20,000,000 shares of a par value of US$0.0000625 each as 20,000,000 class B shares of US$0.0000625 each (the “Class B Shares”, each such share carrying thirty (30) votes per share with such rights, restrictions and privileges as set out in the New M&A (as defined below))(the Class A Shares together with the Class B Shares, the “Shares”) (the “Reclassification”) so that the authorized share capital of the Company shall be changed from US$50,000 divided into 800,000,000 shares of a par value of US$0.0000625 each to US$50,000 divided into 800,000,000 shares of a par value of US$0.0000625 each comprised of 780,000,000 Class A Shares of a par value of US$0.0000625 each and 20,000,000 Class B Shares of a par value of US$0.0000625 each, such shares having the rights, restrictions and privileges as set out in the New M&A (as defined below); b) (i) contemporaneously upon the Reclassification taking effect, each issued share of a par value of US$0.0000625 each of the Company shall be re-designated as an issued Class A Share (the “Re-designation”) with all rights, restrictions and privileges remaining identical to the existing issued shares of the Company; and (ii) immediately following the Re-designation, 3,000,000 Class A Shares then held by Neo-Concept (BVI) Limited (“NCBVI”) shall be repurchased and cancelled by the Company and in consideration, the Company shall allot and issue to NCBVI (or such other person as directed) 3,000,000 Class B Shares, credited as fully paid-up; c) the second amended and restated memorandum of association and articles of association of the Company containing the amendments to the existing amended and restated memorandum of association and articles of association in the form set out in Annex I be and are approved and adopted as the new memorandum of association and articles of association of the Company in substitution for and to the exclusion of the existing amended and restated memorandum of association and articles of association of the Company; On May 9, 2025, the shareholders of the Company resolved and approved that with effect from such date and time to be determined by the board of directors of the Company which in any event shall not be later than 1 July 2025: ● every five issued and unissued shares (namely, both class A ordinary shares of par value US$0.0000625 each and class B ordinary shares of par value US$0.0000625 each) in the share capital of the Company be consolidated into one (1) share of par value US$0.0003125 each (the “Share Consolidation”) so that the authorised share capital of the Company shall be changed from US$50,000 consisting of 800,000,000 shares of par value US$0.0000625 each comprised of 780,000,000 class A ordinary shares of par value US$0.0000625 each and 20,000,000 class B ordinary shares of par value US$0.0000625 each to US$50,000 consisting of 160,000,000 shares of par value US$0.0003125 each comprised of 156,000,000 class A ordinary shares of par value US$0.0003125 each and 4,000,000 class B ordinary shares of par value US$0.0003125 each; As of the date of this Annual Report, the Share Consolidation has not yet been effective. 20 Neo-Concept International Group Holdings Limited’s Offices Our principal executive office is located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong.
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The aggregate sales generated in these months accounted for approximately 33.5% and 65.4% of our total revenue for the years ended December 31, 2022 and 2021, respectively. However, for the year ended December 31, 2022, we observed particularly strong sales from April to July, which constituted approximately 43.7% of our total revenue.
Added
In 2000, Neo-Concept UK began to sell apparel products in the UK under the brand “ les 100 ciels ” through its retail stores.
Removed
The following table sets out the details of the leases: Property location Approximate floor area Lease term Rent 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong 10,700 square feet January 1, 2022 to December 31, 2023 HKD 60,000 per month Ground floor and basement of 62 South Molton Street, London, UK 950 square feet (men’s store) 650 square feet (basement) February 23, 2023 to February 22, 2033 Rent free from February 23, 2023 to August 22, 2024 and £60,000 during August 23, 2023 to February 22, 2024 £130,000 per year during February 23, 2024 to February 22, 2025 £140,000 per year during February 23, 2025 to February 22, 2026 £150,000 per year during February 23, 2026 to February 22, 2027 £170,000 per year during February 23, 2027 to February 22, 2033 36 Property location Approximate floor area Lease term Rent Ground floor and basement of 52 South Molton Street, London, UK 669 square feet (women’s store) 703 square feet (office & storage) April 23, 2023 to April 23, 2033 Rent free from April 24, 2023 to October 23, 2023 and £40,000 during October 24, 2023 to April 23, 2024. £85,000 per year during April 24, 2024 to April 23, 2025 £90,000 per year during April 24, 2025 to April 23, 2026 £95,000 per year during April 24, 2026 to April 23, 2027 £100,000 per year during April 24, 2027 to April 23, 2033 27 St John’s Wood, London, UK 700 square feet (mixed men’s and women’s store) August 8, 2023 to February 7, 2024 £6,000 per month We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available on commercially reasonable terms to accommodate any expansion of our operations.
Added
In 2024, our group formed a joint venture with a company in the United Arabs Emirates for the purpose of selling our own-branded products under the brand “les 100 ciels” in the Middle East and Northern African regions. In March 2025, the first Middle East “les 100 ciels” shop was opened in Abu Dhabi, the United Arabs Emirates.
Added
(“NCEF”) - A UAE company - Incorporated in May 2024 - Issued Share Capital of AED100,000 - Intermediate holding company 100% owned by NCEC Lineowa Fashion and Life Style L.L.C.
Added
(“Lineowa”) - A UAE company - Incorporated in October 2024 - Issued Share Capital of AED100 - Provision of online and offline retail sales of apparel products 50% owned by NCEF 34 We are a “controlled company” as defined under the Nasdaq Stock Market Rules because our Controlling Shareholder owns 71.5% of our total issued and outstanding Class A Ordinary Shares, representing 84.64% of the total voting power.
Added
We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available on commercially reasonable terms to accommodate any expansion of our operations.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

48 edited+22 added−20 removed37 unchanged
For the years ended December 31, 2022 2023 2023 HKD HKD US$ Sales of private-labelled apparel products 336,306,554 156,316,352 20,012,592 Retail sales of own-branded apparel products 11,145,014 17,886,275 2,289,912 Total 347,451,568 174,202,627 22,302,504 Our revenue decreased by 49.9% to HKD 174,202,627 (US$22,302,504) for the year ended December 31, 2023, from HKD347,451,568 for the year ended December 31, 2022.
For the years ended December 31, 2022 2023 2023 HKD HKD US$ Private-labelled apparel products 336,306,554 156,316,352 20,012,592 Retail sales of own-branded apparel products 11,145,014 17,886,275 2,289,912 Total 347,451,568 174,202,627 22,302,504 Our revenue decreased by 49.9% to HKD174,202,627 (US$22,302,504) for the year ended December 31, 2023, from HKD347,451,568 for the year ended December 31, 2022.
For the year ended December 31, 2023, net cash from financing activities of HKD47,546,606 (US$6,087,213) consisted of (i) proceeds from bank borrowings of HKD115,018,274 (US$14,725,356); and (ii) advance from related parties of HKD101,130,691 (US$12,947,380), the effects of which were partially offset by (i) repayment for bank borrowings of HKD168,602,359 (US$21,585,523).
For the year ended December 31, 2023, net cash generated from financing activities of HKD47,546,606 (US$6,087,213) consisted of (i) proceeds from bank borrowings of HKD115,018,274 (US$14,725,356); and (ii) advance from related parties of HKD101,130,691 (US$12,947,380), the effects of which were partially offset by (i) repayment for bank borrowings of HKD168,602,359 (US$21,585,523).
Our overall gross profit margin however increased by 8.1 percentage points to 20.2% for the year ended December 31, 2023, from 12.0% for the year ended December 31, 2022, mainly due to our increase in sales of products with higher margin.
Our overall gross profit margin however increased by 8.1 percentage points to 20.1% for the year ended December 31, 2023, from 12.0% for the year ended December 31, 2022, mainly due to our increase in sales of products with higher margin.
We make no representation that the HKD or U.S. dollar amounts referred to in this report could have been or could be converted into U.S. dollars or HKD, as the case may be, at any particular rate. A.
We make no representation that the HKD or U.S. dollar amounts referred to in this report could have been or could be converted into U.S. dollars or HKD, as the case may be, at any particular rate. 36 A.
The Group has elected to include the carrying amount of finance and operating lease liabilities in any tested asset group and include the associated lease payments in the undiscounted future pre-tax cash flows. For the years ended December 31, 2023, 2022 and 2021, the Group did not have any impairment loss against its operating lease right-of-use assets.
The Group has elected to include the carrying amount of finance and operating lease liabilities in any tested asset group and include the associated lease payments in the undiscounted future pre-tax cash flows. For the years ended December 31, 2024, 2023 and 2022, the Group did not have any impairment loss against its operating lease right-of-use assets.
The Group generally uses the base, non-cancellable lease term in calculating the right-of-use assets and liabilities. 46 The Group may recognize the lease payments in the consolidated statements of operations on a straight-line basis over the lease terms and variable lease payments in the periods in which the obligations for those payments are incurred, if any.
The Group generally uses the base, non-cancellable lease term in calculating the right-of-use assets and liabilities. 47 The Group may recognize the lease payments in the consolidated statements of operations on a straight-line basis over the lease terms and variable lease payments in the periods in which the obligations for those payments are incurred, if any.
Net income Our net income decreased by 64.4% to HKD4,414,733 (US$565,202) for the year ended December 31, 2023, from HKD12,400,516 for the year ended December 31, 2022. The decrease in net income was predominantly due to the decrease in our revenue in 2022.
Net income Our net income decreased by 64.4% to HKD4,414,733 (US$565,202) for the year ended December 31, 2023, from HKD12,400,516 for the year ended December 31, 2022. The decrease in net income was predominantly due to the decrease in our revenue in 2022. 42 B.
Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For the years ended December 31, 2023, 2022 and 2021, no impairment of long-lived assets was recognized.
Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For the years ended December 31, 2024, 2023 and 2022, no impairment of long-lived assets was recognized.
Cost of revenue For the years ended December 31, 2022 2023 2023 HKD HKD US$ Private-labelled apparel products 301,429,220 134,239,759 17,186,208 Own-branded apparel products 4,187,387 4,914,557 629,193 Total 305,616,607 139,154,316 17,815,401 Our cost of revenue decreased by 54.5% to HKD139,085,780 (US$17,806,627) for the year ended December 31, 2023, from HKD305,616,607 for the year ended December 31, 2022.
Cost of revenue For the years ended December 31, 2022 2023 2023 HKD HKD US$ Private-labelled apparel products 301,429,220 134,239,759 17,186,208 Own-branded apparel products 4,187,387 4,914,557 629,193 Total 305,616,607 139,154,316 17,815,401 Our cost of revenue decreased by 54.5% to HKD139,154,316 (US$17,815,401) for the year ended December 31, 2023, from HKD305,616,607 for the year ended December 31, 2022.
Changes in operating assets and liabilities mainly include (i) increase in trade receivable of HKD23,387,722 (US$2,994,242) because we utilized less factoring of accounts receivable; (ii) increase of other current assets, net of HKD14,332,426 (US$1,834,926) due to increase in prepayments to suppliers to secure our supplies for production and business; (iii) the increase in inventories of HKD4,088,840 (US$523,479) to cope with the increase in retail sales as we opened an additional retail shop in London in 2023; and (iv) the decrease in accounts payable of HKD10,429,941 (US$1,335,306) as we increased our prepayment to secure our production; and (v) decrease if tax payable of HKD3,969,112 (US$508,150) as our assessable profit reduced in 2023, and partially offset by (i) increase in accruals and other payables of HKD963,089 (US$ 123,301) principally due to the increase of payroll payable as a result of headcount increase and value added tax payable principally resulting from business expansion in the UK.
Changes in operating assets and liabilities mainly include (i) increase in trade receivable of HKD23,387,722 (US$2,994,242) because we utilized less factoring of accounts receivable; (ii) increase of prepayment and other current assets of HKD14,332,426 (US$1,834,926) due to increase in prepayments to suppliers to secure our supplies for production and business; (iii) the increase in inventories of HKD4,088,840 (US$523,479) to cope with the increase in retail sales as we opened an additional retail shop in London in 2023; and (iv) the decrease in accounts payable of HKD10,429,941 (US$1,335,306) as we increased our prepayment to secure our production; and (v) decrease if tax payable of HKD3,969,112 (US$508,150) as our assessable profit reduced in 2023, and partially offset by (i) increase in accruals and other payables of HKD1,173,924 (US$150,293) principally due to the increase of payroll payable as a result of headcount increase and value added tax payable principally resulting from business expansion in the UK.
Our gross profit margin for private-labelled apparel products however increased by 3.8 percentage points to 14.2% for the year ended December 31, 2023, from 10.4% for the year ended December 31, 2022 as we increased our sales in products with higher margin in 2023.
Our gross profit margin for private-labelled apparel products however increased by 3.7 percentage points to 14.1% for the year ended December 31, 2023, from 10.4% for the year ended December 31, 2022 as we increased our sales in products with higher margin in 2023.
The increase was mainly due to the increase in sales of products with higher margin. 38 Selling and marketing expenses For the years ended December 31, 2022 2023 2023 HKD HKD US$ Transportation costs 1,057,957 333,257 113,406 Marketing and displaying expenses 1,573,274 2,799,020 287,608 Total selling and marketing expenses 2,631,231 3,132,277 401,014 Our selling and marketing expenses increased by 19.0% to HKD3,132,277 (US$401,014) for the year ended December 31, 2023, from HKD2,631,231 for the year ended December 31, 2022, primarily due to increase in marketing and displaying expenses due to business expansion including open up of new retail shops in the UK, which were partially offset by the decrease in transportation costs as a result of decrease in sales.
The increase was mainly due to the increase in sales of products with higher margin. 40 Selling and marketing expenses For the years ended December 31, 2022 2023 2023 HKD HKD US$ Transportation costs 1,057,957 333,257 42,666 Marketing and displaying expenses 1,573,274 2,799,020 358,348 Total 2,631,231 3,132,277 401,014 Our selling and marketing expenses increased by 19.0% to HKD3,132,277 (US$401,014) for the year ended December 31, 2023, from HKD2,631,231 for the year ended December 31, 2022, primarily due to increase in marketing and displaying expenses due to business expansion including open up of new retail shops in the UK, which were partially offset by the decrease in transportation costs as a result of decrease in sales.
Our gross profit margin for own-branded apparel products increased by 9.7 percentage points to 72.1% for the year ended December 31, 2023, from 62.4% for the year ended December 31, 2022.
Our gross profit margin for own-branded apparel products increased by 10.1 percentage points to 72.5% for the year ended December 31, 2023, from 62.4% for the year ended December 31, 2022.
For the year ended December 31, 2023, net cash used in investing activities was HKD1,275,847 (US$163,342) which related to the acquisition of computer and office equipment and leasehold improvement.
Cash used in investing activities For the year ended December 31, 2022, net cash used in investing activities was HKD73,526 (US$9,425) which related to the acquisition of computer and office equipment. For the year ended December 31, 2023, net cash used in investing activities was HKD1,275,847 (US$163,342) which related to the acquisition of computer and office equipment and leasehold improvement.
General and administrative expenses For the years ended December 31, 2022 2023 2023 HKD HKD US$ Staff costs 12,436,317 13,260,898 1,697,743 Rental and office expenses 3,205,017 3,260,273 417,401 Insurance 59,595 66,393 8,500 Amortization of intangible assets 137,358 112,049 14,345 Depreciation 11,114 33,091 4,237 Expected credit loss — 1,383,316 177,101 Legal and professional fee 3,654,819 2,204,622 282,249 Others 764,197 2,548,867 326,321 20,268,417 22,869,509 2,927,897 Our general and administrative expenses increased by 11.4% to HKD22,869,509 (US$2,927,897) for the year ended December 31, 2023, from HKD20,268,417 for the year ended December 31, 2022, the increase was principally due to the increase in rental and office expenses due to business expansion including open-up of new retail shops in the UK, expected credit loss and impairment losses on receivables, which were partially offset by the decrease in legal and professional fee as the engagements for professionals to assist us in the preparation for our IPO project reduced.
General and administrative expenses For the years ended December 31, 2022 2023 2023 HKD HKD US$ Staff costs 12,436,317 13,260,898 1,697,743 Depreciation 3,205,017 3,260,273 417,401 Insurance 59,595 66,393 8,500 Amortization 137,358 112,049 14,345 Provision for expected credit losses — 1,383,316 177,101 Professional fee 3,654,819 2,204,622 282,249 Others 775,311 2,581,958 330,558 Total 20,268,417 22,869,509 2,927,897 Our general and administrative expenses increased by 12.8% to HKD22,869,509 (US$2,927,897) for the year ended December 31, 2023, from HKD20,268,417 for the year ended December 31, 2022, the increase was principally due to the increase in rental and office expenses due to business expansion including open-up of new retail shops in the UK, expected credit loss and impairment losses on receivables, which were partially offset by the decrease in legal and professional fee as the engagements for professionals to assist us in the preparation for our IPO project reduced.
Our gross profit for private-labelled apparel products decreased by 36.5% to HKD22,145,129 (US$2,835,157) for the year ended December 31, 2023, from HKD34,877,334 for the year ended December 31, 2022. The decrease was principally in correspondence to the decrease of revenue upon the decrease of orders from our largest customer.
Our gross profit for private-labelled apparel products decreased by 36.7% to HKD22,076,593 (US$2,826,383) for the year ended December 31, 2023, from HKD34,877,334 for the year ended December 31, 2022. The decrease was principally in correspondence to the decrease of revenue upon the decrease of orders from our largest customer.
Changes in operating assets and liabilities mainly include (i) the increase in other current assets, net of HKD3,796,835 (US$486,680) due to the increase in our deferred IPO costs; (ii) the increase in inventories of HKD619,878 (US$79,456) to cope with the increase in retail sales as we opened an additional retail shop in London in 2022; and (iii) the decrease in accounts payable of HKD74,184,359 (US$9,508,987) as we sped up our settlement of accounts payable to take advantage of bulk purchase; and partially offset by (i) decrease in accounts receivable of HKD19,369,617 (US$2,482,807) because we sped up the collection of accounts receivable by way of factoring so as to strengthen our liquidity for the year ended December 31, 2022; (ii) increase in accruals and other payables of HKD921,015 (US$118,056) mainly due to the increase in value added tax payable; and (ii) the increase in tax payable of HKD3,001,914 (US$384,787). 44 For the year ended December 31, 2023, we had net cash used in operating activities of HKD 49,225,351 (US$6,302,136) mainly arising from net income from our operation of HK$4,414,733 (US$ 565,202), as adjusted for non-cash items and changes in operating assets and liabilities.
Changes in operating assets and liabilities mainly include (i) the increase in prepayment and other current assets of HKD3,796,835 (US$486,680) due to the increase in our deferred IPO costs; (ii) the increase in inventories of HKD619,878 (US$79,456) to cope with the increase in retail sales as we opened an additional retail shop in London in 2023; and (iii) the decrease in accounts payable of HKD74,184,359 (US$9,508,987) as we sped up our settlement of accounts payable to take advantage of bulk purchase; and partially offset by (i) decrease in accounts receivable of HKD19,369,617 (US$2,482,807) because we sped up the collection of accounts receivable by way of factoring so as to strengthen our liquidity for the year ended December 31, 2022; (ii) increase in accruals and other payables of HKD921,015 (US$118,056) mainly due to the increase in value added tax payable; and (ii) the increase in tax payable of HKD3,001,914 (US$384,787).
Our gross profit for own-branded apparel products increased by 85.5% to HKD12,903,182 (US$1,651,946) for the year ended December 31, 2023, from HKD6,957,627 for the year ended December 31, 2022. The increase was mainly due to business expansion including open-up of new retail shops in the UK.
Our gross profit for own-branded apparel products increased by 86.4% to HKD12,971,718 (US$1,660,720) for the year ended December 31, 2023, from HKD6,957,627 for the year ended December 31, 2022. The increase was mainly due to business expansion including open-up of new retail shops in the UK.
Lease The Group is a lessee of non-cancellable operating leases for corporate office premise. The Group determines if an arrangement is a lease at inception. Lease assets and liabilities are recognized at the present value of the future lease payments at the leases commencement date.
The Group determines if an arrangement is a lease at inception. Lease assets and liabilities are recognized at the present value of the future lease payments at the leases commencement date.
For the year ended December 31, 2022, net cash from financing activities of HKD49,997,884 (US$6,408,752) consisted of (i) proceeds from bank borrowings of HKD508,716,999 (US$65,207,588), the effects of which were partially offset by (i) repayment for bank borrowings of HKD452,377,168 (US$57,985,922); and (ii) advance to related parties of HKD6,341,947 (US$812,914).
For the year ended December 31, 2024, net cash used in investing activities was HKD19,167,148 (US$2,467,545) which related to the acquisition of computer and office equipment, leasehold improvement and trademarks. 45 Net cash generated from financing activities For the year ended December 31, 2022, net cash generated from financing activities of HKD49,997,884 (US$6,408,752) consisted of (i) proceeds from bank borrowings of HKD508,716,999 (US$65,207,588), the effects of which were partially offset by (i) repayment for bank borrowings of HKD452,377,168 (US$57,985,922); and (ii) advance to related parties of HKD6,341,947 (US$812,914).
The Group computes depreciation using the straight-line method over the estimated useful lives of the assets as follows: Office equipment 1 – 3 years Furniture and fixtures 3 years Motor vehicles 5 years Leasehold improvements Over the shorter of the lease term or estimated useful life The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of operations.
The Group computes depreciation using the straight-line method over the estimated useful lives of the assets as follows: Leasehold improvement Over the shorter of the terms of leases or 5 years when the renewal of leases is unconditional Furniture, fixtures, and office equipment 6 years to 7 years The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of operations.
As of December 31, 2023 and 2022, the allowance for doubtful accounts was nil. Property and equipment, net Property and equipment are stated at cost less accumulated depreciation and impairment if applicable.
As of December 31, 2024 and 2023, the allowance for doubtful accounts was HKD1,414,818 and HKD2,668,186, respectively. Property and equipment, net Property and equipment are stated at cost less accumulated depreciation and impairment if applicable.
Year ended December 31, 2022 compared with year ended December 31, 2021 Revenue For the years ended December 31, 2022 and 2021, we generated our revenue through two revenue streams: sales of private-labelled apparel products and retail sales of own-branded apparel products.
The increase in net income was predominantly due to the increase in our revenue in 2024. 39 Year ended December 31, 2023 compared with year ended December 31, 2022 Revenue For the years ended December 31, 2023 and 2022, we generated our revenue through two revenue streams: sales of private -labelled apparel products and retail sales of own -branded apparel products.
From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HKD2,000,000, and 16.5% on any part of assessable profits over HKD2,000,000.
Hong Kong current profit tax arose from the operation of Neo-Concept HK in Hong Kong and its applicable tax rate is 16.5%. From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HKD2,000,000, and 16.5% on any part of assessable profits over HKD2,000,000.
Translations of amounts from HKD into US$ are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = HKD 7.8015, US$1 = HKD 7.8363 and US$1 = HKD 7.8109 on December 30, 2022, June 30, 2023 and December 29, 2023, respectively, as published in H.10 statistical release of the Board of Governors of the Federal Reserve System.
Translations of amounts from HKD into US$ are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = HKD 7.7677, as published in H.10 statistical release of the United States Federal Reserve Board.
Our overall gross profit margin increased by 2.6 percentage points to 12.0% for the year ended December 31, 2022, from 9.4% for the year ended December 31, 2021, mainly due to our increase in sales of products with higher margin and the advantage from bulk purchase.
Our overall gross profit margin increased by 0.9 percentage points to 21.0% for the year ended December 31, 2024, from 20.1% for the year ended December 31, 2023, mainly due to our increase in sales of products with higher margin.
Contractual Obligations The following table summarized our undiscounted contractual obligations as of December 31, 2022: Payment due by period Less than 1 year 2 to 3 years 4 to 5 years More than 5 years Total HK$ HK$ HK$ HK$ HK$ Contractual Obligations: Operating lease obligation 2,014,564 5,513,198 6,069,718 13,447,761 27,045,241 45 Off-Balance Sheet Arrangements We have no off-balance sheet arrangements, including arrangements that would affect its liquidity, capital resources, market risk support, and credit risk support or other benefits.
Contractual Obligations The following table summarized our undiscounted contractual obligations as of December 31, 2024: Payment due by period Less than 1 year 2 to 3 years 4 to 5 years More than 5 years Total HK$ HK$ HK$ HK$ HK$ Contractual Obligations: Operating lease obligation 7,073,089 14,809,755 14,312,538 21,572,644 57,768,026 Off-Balance Sheet Arrangements We have no off-balance sheet arrangements, including arrangements that would affect its liquidity, capital resources, market risk support, and credit risk support or other benefits. 46 C.
We generally grant our customers a credit period ranging from 30 to 60 days, depending on their reputation, transaction history and the products purchased. Our accounts receivable increased by 212.8% to HKD32,343,592 (US$4,140,828) as of December 31, 2023, from HKD10,339,186 as of December 31, 2022, because we utilized less factoring of accounts receivable to save from high arrangement fee.
Our accounts receivable increased by 212.8% to HKD32,343,592 (US$4,140,828) as of December 31, 2023, from HKD10,339,186 as of December 31, 2022, because we utilized less factoring of accounts receivable to save from high arrangement fee.
The increase was primarily attributable to the increase in prepayments to suppliers to secure our supplies for production and business. Inventories Our inventories represented owen-branded apparel products at our retail shops in London. Our inventories increased by 309.3% to HKD5,320,199 (US$681,125) as of December 31, 2022.
The increase was primarily attributable to the increase in prepayments to suppliers to secure our supplies for production and business. 43 Inventories Our inventories represented owen-branded apparel products at our retail shops in London. Our inventories decreased by 32.0% to HKD3,616,821(US$465,623) as of December 31, 2024.
We believe that maintaining appropriate levels of inventories can help us better plan raw material procurement and deliver our products to meet customer demand in a timely manner without straining our liquidity. During the years ended December 31, 2021 and 2022, our obsolete and slow-moving inventories amounted to nil and nil, respectively.
We review our inventory levels on a regular basis. We believe that maintaining appropriate levels of inventories can help us better plan raw material procurement and deliver our products to meet customer demand in a timely manner without straining our liquidity.
Our gross profit margin for own-branded apparel products increased by 6.0 percentage points to 62.4% for the year ended December 31, 2022, from 56.4% for the year ended December 31, 2021. The increase was mainly due to the increase in sales of products with higher margin and the increase in sales of premium products with better pricing.
Our gross profit margin for own-branded apparel products increased by 7.2 percentage points to 79.7% for the year ended December 31, 2024, from 72.5% for the year ended December 31, 2023. The increase was mainly due to the increase in sales of products with higher margin.
For the year ended December 31, 2021, we had net cash generated from operating activities of HKD10,270,422 (US$1,316,788) mainly arising from net income from our operation of HK$5,450,515, as adjusted for non-cash items and changes in operating assets and liabilities.
For the year ended December 31, 2024, we had net cash generated from operating activities of HKD428,243 (US$55,131) mainly arising from net income from our operation of HKD8,063,331 (US$1,038,059), as adjusted for non-cash items and changes in operating assets and liabilities.
Capital Expenditures We incurred capital expenditures of HKD1,275,847 (US$163,342) and HKD78,190 for the years ended December 31, 2023 and 2022, respectively, which related to the acquisition of computer and office equipment and leasehold improvement. As of December 31, 2023, we did not have any capital expenditure commitment.
Capital Expenditures We incurred capital expenditures of HKD73,526, HKD1,275,847 and HKD19,167,148 (US$2,467,545) for the years ended December 31, 2022, 2023 and 2024, respectively, which related to the acquisition of computer and office equipment and leasehold improvement and acquisition of trademarks.
Results of operations For the Years Ended December 31, 2021 2022 2023 2023 HKD HKD HKD US$ REVENUES, NET 240,536,527 347,451,568 174,202,627 22,302,504 COST OF REVENUES -Related parties (29,522,341 ) (103,159,420 ) (34,213,521 ) (4,380,228 ) -External (188,421,081 ) (202,457,187 ) (104,940,795 ) (13,435,173 ) (217,943,422 ) (305,616,607 ) (139,154,316 ) (17,815,401 ) Gross profit 22,593,105 41,834,961 35,048,311 4,487,103 EXPENSES Selling and marketing (3,133,094 ) (2,631,231 ) (3,132,277 ) (401,014 ) General and administrative (14,986,860 ) (20,268,417 ) (22,869,509 ) (2,927,897 ) Total expenses (18,119,954 ) (22,899,648 ) (26,001,786 ) (3,328,911 ) INCOME FROM OPERATION 4,473,151 18,935,313 9,046,525 1,158,192 OTHER INCOME (EXPENSES) Interest income 1 1 92,951 11,900 Interest expense (2,492,179 ) (6,133,455 ) (5,759,182 ) (737,326 ) Other income 5,217,777 2,586,019 2,662,360 340,852 Other expense (5,953 ) (7,444 ) (302,784 ) (38,764 ) Total other income (expenses), net 2,719,646 (3,554,879 (3,306,655 ) (423,338 ) INCOME BEFORE TAX EXPENSES 7,192,797 15,380,434 5,739,870 734,854 INCOME TAX EXPENSES (1,742,282 ) (2,979,918 ) (1,325,137 ) (169,652 ) NET INCOME 5,450,515 12,400,516 4,414,733 565,202 37 Year ended December 31, 2023 compared with year ended December 31, 2022 Revenue For the years ended December 31, 2022 and 2021, we generated our revenue through two revenue streams: sales of private(labelled apparel products and retail sales of own(branded apparel products.
Results of operations For the Years Ended December 31, 2022 2023 2024 2024 HKD HKD HKD US$ REVENUES, NET 347,451,568 174,202,627 235,667,734 30,339,448 COST OF REVENUES -Related parties (103,159,420 ) (34,213,521 ) (7,915,189 ) (1,018,987 ) -External (202,457,187 ) (104,940,795 ) (178,307,992 ) (22,955,056 ) (305,616,607 ) (139,154,316 ) (186,223,181 ) (23,974,043 ) Gross profit 41,834,961 35,048,311 49,444,553 6,365,405 EXPENSES Selling and marketing (2,631,231 ) (3,132,277 ) (4,392,521 ) (565,486 ) General and administrative (20,268,417 ) (22,869,509 ) (33,480,608 ) (4,310,234 ) Total expenses (22,899,648 ) (26,001,786 ) (37,873,129 ) (4,875,720 ) INCOME FROM OPERATION 18,935,313 9,046,525 11,571,424 1,489,685 OTHER INCOME (EXPENSES) Interest income 1 92,951 31,954 4,114 Interest expense (6,133,455 ) (5,759,182 ) (3,759,032 ) (483,931 ) Other income 2,586,019 2,662,360 1,304,894 167,989 Other expense (7,444 ) (302,784 ) — — Total other expenses, net (3,554,879 ) (3,306,655 ) (2,422,184 ) (311,828 ) INCOME BEFORE TAX EXPENSES 15,380,434 5,739,870 9,149,240 1,177,857 INCOME TAX EXPENSES (2,979,918 ) (1,325,137 ) (1,085,909 ) (139,798 ) NET INCOME 12,400,516 4,414,733 8,063,331 1,038,059 Year ended December 31, 2024 compared with year ended December 31, 2023 Revenue For the years ended December 31, 2024 and 2023, we generated our revenue through two revenue streams: sales of private -labelled apparel products and retail sales of own -branded apparel products.
Other income For the years ended December 31, 2022 2023 2023 HKD HKD US$ Agency income 2,586,019 2,662,034 340,810 Other — 326 42 2,586,019 2,662,360 340,852 Our agency income representing service fee charged to a related party, NCH, for promoting NCH’s products in UK stayed relatively stable at HKD2,586,019 and 2,662,034 (US$340,810) for the year ended December 31, 2022, and 2023, respectively.
Other income For the years ended December 31, 2022 2023 2023 HKD HKD US$ Agency income 2,586,019 2,662,034 340,810 Other — 326 42 Total 2,586,019 2,662,360 340,852 Our agency income representing service fee charged to a related party, NCH, for promoting NCH’s products in UK stayed relatively stable at HKD2,586,019 and 2,662,034 (US$340,810) for the year ended December 31, 2022, and 2023, respectively. 41 Other expenses For the years ended December 31, 2022 2023 2023 HKD HKD US$ Exchange loss, net (7,444 ) (168,356 ) (21,554 ) Penalty — (134,428 ) (17,210 ) Total (7,444 ) (302,784 ) (38,764 ) Our other expenses increased by 3,967.5% to HKD302,784 (US$38,764) for the year ended December 31, 2023, from HKD7,444 for the year ended December 31, 2022, the increase was principally due to the increase in exchange loss, net due to currency fluctuation and increase in penalty arising in the normal course of business.
We increased our inventory level as of December 31, 2023 to cope with the increase in retail sales as we opened an additional retail shop in London in 2023. We review our inventory levels on a regular basis.
We maintained our inventory level as of December 31, 2024 to minimize its inventory cost. Our inventories increased by 309.3% to HKD5,320,199 (US$681,125) as of December 31, 2023. We increased our inventory level as of December 31, 2023 to cope with the increase in retail sales as we opened an additional retail shop in London in 2023.
The following table sets forth a summary of our cash flows information for the years indicated: For the Years Ended December 31, 2021 2022 2023 2023 HKD HKD HKD US$ Cash and cash equivalents at the beginning of the year 421,495 1,428,243 8,593,063 1,100,137 Net cash used in operating activities 10,270,422 (42,759,538 ) (49,225,351 ) (6,302,136 ) Net cash used in investing activities (78,190 ) (73,526 ) (1,275,847 ) (163,342 ) Net cash from financing activities (9,185,484 ) 49,997,884 47,546,606 6,087,213 1,428,243 8,593,063 5,638,471 721,872 Cash generated from (used in) operating activities Our cash inflow from operating activities was principally from receipt of sales.
The following table sets forth a summary of our cash flows information for the years indicated: For the Years Ended December 31, 2022 2023 2024 2024 HKD HKD HKD US$ Cash and cash equivalents at the beginning of the year 1,428,243 8,593,063 5,849,306 753,029 Net cash (used in) generated from operating activities (42,759,538 ) (49,014,516 ) 428,243 55,131 Net cash used in investing activities (73,526 ) (1,275,847 ) (19,167,148 ) (2,467,545 ) Net cash generated from financing activities 49,997,884 47,546,606 21,891,118 2,818,224 Effect of foreign currency translation on cash and cash equivalents — — 164,501 21,178 8,593,063 5,849,306 9,166,020 1,180,017 44 Cash (used in) generated from operating activities Our cash inflow from operating activities was principally from receipt of sales.
Our gross profit margin for private-labelled apparel products increased by 1.7 percentage points to 10.4% for the year ended December 31, 2022, from 8.7% for the year ended December 31, 2021 as we increased our sales in products with higher margin in 2022 and continue to increase our purchases from a major supplier to take advantage of bulk purchase.
Our gross profit margin for private-labelled apparel products decreased by 4.7 percentage points to 9.4% for the year ended December 31, 2024, from 14.1% for the year ended December 31, 2023 as overall cost of purchase from suppliers increased in 2024.
Our effective tax rate decreased by 4.8 percentage points to 19.4% for the year ended December 31, 2022 from 24.2% for the year ended December 31, 2021. The decrease in effective tax rate was mainly due to temporary difference arising from Neo-Concept NY not recognized in 2021.
Our effective tax rate increased by 11.2 percentage points to 11.9% for the year ended December 31, 2024 from 23.1% for the year ended December 31, 2023. The decrease in effective tax rate was mainly due to the tax loss utilization by the subsidiary, Neo-Concept (UK) Limited.
Other current assets, net As of December 31, 2022 2023 2023 HKD HKD US$ Deferred IPO costs 4,229,639 8,148,021 1,043,160 Prepayments 129,229 12,021,838 1,539,110 Others 21,996 55,863 7,155 Total 4,380,864 20,225,722 2,589,425 Our other current assets, net increased by 361.7% to HKD20,225,722 (US$2,589,425) as of December 31, 2023, from HKD4,380,864 as of December 31, 2022.
Prepayment and other current assets As of December 31, 2023 2024 2024 HKD HKD US$ Deferred IPO costs 8,148,021 — — Prepayments 12,021,838 24,384,141 3,139,171 Others 55,863 3,589 462 Total 20,225,722 24,387,730 3,139,633 Our prepayment and other current assets increased by 20.6% to HKD24,387,730 (US$3,139,633) as of December 31, 2024, from HKD20,225,722 as of December 31, 2023.
Other expenses For the years ended December 31, 2022 2023 2023 HKD HKD US$ Exchange loss, net (7,444 ) (168,356 ) (21,554 ) Penalty — (134,428 ) (17,210 ) (7,444 ) (302,784 ) (38,764 ) Our other expenses increased by 3,967.5% to HKD302,784 (US$38,764) for the year ended December 31, 2023, from HKD7,444 for the year ended December 31, 2022, the increase was principally due to the increase in exchange loss, net due to currency fluctuation and increase in penalty arising in the normal course of business. 39 Provision for income tax expense For the Years ended December 31, 2022 2023 2023 HKD HKD US$ Current: Hong Kong 2,979,918 928,973 118,941 UK — 388,228 49,703 2,979,918 1,317,201 168,644 Deferred: UK — 7,867 1,008 Total provision for income taxes 2,979,918 1,325,137 169,652 Provision for income tax expense represents current profit tax.
Provision for income tax expense For the Years ended December 31, 2022 2023 2023 HKD HKD US$ Current: Hong Kong 2,979,918 928,973 118,941 UK — 388,288 49,703 2,979,918 1,317,261 168,644 Deferred: UK — 7,876 1,008 Total 2,979,918 1,325,137 169,652 Provision for income tax expense represents current profit tax. Current profit tax represented tax recorded in Hong Kong.
Our accounts payable decreased by 100.0% to nil as of December 31, 2023, from HKD10,429,941 as of December 31, 2022, which was because we increase our prepayment to secure our production and to take advantage of early payment. 43 Accruals and other payables As of December 31, 2022 2023 2023 HKD HKD US$ Payroll payable 734,454 2,185,617 279,816 Interest payable 412,442 46,397 5,940 Value added tax 905,214 834,902 106,889 Others 190,505 138,789 17,768 Total 2,242,615 3,205,705 410,413 Our accruals and other payables increased by 42.9% to HKD3,205,704 (US$410,414) as of December 31, 2023, from HKD2,242,615 as of December 31, 2021, principally due to the increase of payroll payable as a result of headcount increase and value added tax payable principally resulting from business expansion in the UK.
Our accruals and other payables increased by 42.9% to HKD3,205,705 (US$410,413) as of December 31, 2023, from HKD2,242,615 as of December 31, 2022, principally due to the increase of payroll payable as a result of headcount increase and value added tax payable principally resulting from business expansion in the UK.
Liquidity and capital resources As of December 31, 2022 2023 2023 HKD HKD US$ CURRENT ASSETS Cash and cash equivalents 8,593,063 5,849,306 748,865 Accounts receivable, net 10,339,186 32,343,592 4,140,828 Other current assets, net 4,380,864 20,225,722 2,589,425 Due from related parties 16,272,733 — — Inventories, net 1,299,895 5,320,199 681,125 Total current assets 40,885,741 63,738,819 8,160,243 CURRENT LIABILITIES Bank borrowings 83,962,426 30,753,400 3,937,242 Accounts payable 10,429,941 — — Accruals and other payables 2,242,615 3,205,705 410,413 Due to related parties — 34,243,244 4,384,033 Operating lease liabilities 653,344 708,829 90,750 Tax payable 4,885,548 916,436 117,329 Total current liabilities 102,173,874 69,827,614 8,939,767 Net current liabilities (61,288,133 ) (6,088,795 ) (779,524 ) Accounts receivable, net Accounts receivable represented receivables from our customers arising from our sales.
Liquidity and capital resources As of December 31, 2023 2024 2024 HKD HKD US$ CURRENT ASSETS Cash and cash equivalents 5,849,306 9,166,020 1,180,017 Accounts receivable, net 32,343,592 34,169,661 4,398,943 Prepayment and other current assets 20,225,722 24,387,730 3,139,633 Tax recoverable — 994,950 128,088 Inventories, net 5,320,199 3,616,821 465,623 Total current assets 63,738,819 72,335,182 9,312,304 CURRENT LIABILITIES Bank borrowings 30,753,400 27,105,722 3,489,543 Accruals and other payables 3,205,705 7,292,824 938,865 Due to related parties 34,243,244 638,243 82,167 Operating lease liabilities 708,829 3,890,482 500,854 Tax payable 916,436 372,485 47,953 Total current liabilities 69,827,614 39,299,756 5,059,382 Net current (liabilities) assets (6,088,795 ) 33,035,426 4,252,922 Accounts receivable, net Accounts receivable represented receivables from our customers arising from our sales.
Our gross profit for own-branded apparel products increased by 279.4% to HKD6,957,627 (US$891,832) for the year ended December 31, 2022, from HKD1,834,008 for the year ended December 31, 2021. The increase was mainly due to the recovery of economy and the increase in retail sales in the UK.
Our gross profit for own-branded apparel products increased by 139.1% to HKD31,016,238 (US$3,992,976) for the year ended December 31, 2024, from HKD12,971,718 for the year ended December 31, 2023. The increase was mainly due to business expansion including open-up of new retail shops in the UK.
Interest expense Our interest expense represented factoring charges and interest expense for our bank borrowings, which increased by 146.1% to HKD6,133,455 (US$786,189) for the year ended December 31, 2022, from HKD2,492,179 for the year ended December 31, 2021.
Interest expense Our interest expense represented factoring charges and interest expense for our bank borrowings, it decreased by 34.7% to HKD3,759,032 (US$483,931) for the year ended December 31, 2024 from HKD5,759,182 for the year ended December 31, 2023.
Adjustments for non-cash items consisted of (i) depreciation of property and equipment of HKD136,236 (US$17,467); and (ii) amortization of intangible assets of HKD151,634 (US$19,441).
Adjustments for non-cash items consisted of (i) depreciation of property and equipment of HKD685,245 (US$88,217); (ii) amortization of intangible assets of HKD1,481,738 (US$190,756) and allowance for expected credit loss of HKD1,253,368 (US$161,356).
The license is an exclusive and irrevocable royalty-free license, valid for an initial term of five years until December 31, 2026, with an option to renew for a further term of five-years. D. Trend information See ITEM 5.A “operating results” above for our trend information. E. Critical Accounting Estimates We prepare our consolidated financial statements in accordance with U.S.
Research and development, patents and licenses To date, we owned certain patents, copyrights, or trademarks, including Les100Ciels and . We, through our Operating Subsidiaries, own and maintain the registered domains www.les100ciels.com and www.neo-ig.com D. Trend information See ITEM 5.A “operating results” above for our trend information. E. Critical Accounting Estimates We prepare our consolidated financial statements in accordance with U.S.
Our gross profit for private-labelled apparel products increased by 68.0% to HKD34,877,334 (US$4,470,593) for the year ended December 31, 2022, from HKD20,759,097 for the year ended December 31, 2021. The increase was principally in correspondence to the increase of revenue upon the post COVID-19 economic recovery.
Our gross profit for private-labelled apparel products decreased by 16.5% to HKD18,428,315 (US$2,372,429) for the year ended December 31, 2024, from HKD22,076,593 for the year ended December 31, 2023. The decrease was principally due to the increase in the cost of purchase from suppliers.
Removed
For the years ended December 31, 2021 2022 2022 HKD HKD US$ Sales of private-labelled apparel products 237,282,262 336,306,554 43,107,935 Retail sales of own-branded apparel products 3,254,265 11,145,014 1,428,573 Total 240,536,527 347,451,568 44,536,508 Our revenue increased by 44.4% to HKD347,451,568 (US$44,536,508) for the year ended December 31, 2022, from HKD240,536,527 for the year ended December 31, 2021.
Added
No representation is made that the HKD amounts could have been, or could be, converted, realized, or settled into US$ at such rate or at any other rate.
Removed
The increase was mainly contributed by the increase in sales of private-labelled apparel products by 41.7% to HKD336,306,554 (US$43,107,935) for the year ended December 31, 2022, from HK237,282,262 for the year ended December 31, 2021, which was mainly due to the post-COVID-19 recovery of economy and restoration of business of our customers in 2022.
Added
For the years ended December 31, 2023 2024 2024 HKD HKD US$ Private-labelled apparel products 156,316,352 196,736,307 25,327,485 Own-branded apparel products 17,886,275 38,931,427 5,011,963 Total 174,202,627 235,667,734 30,339,448 Our revenue increased by 35.3% to HKD235,667,734 (US$30,339,448) for the year ended December 31, 2024, from HKD174,202,627 for the year ended December 31, 2023.
Removed
Cost of revenue For the years ended December 31, 2021 2022 2022 HKD HKD US$ Private(labelled apparel products 216,523,165 301,429,220 38,637,342 Own(branded apparel products 1,420,257 4,187,387 536,741 Total 217,943,422 305,616,607 39,174,083 Our cost of revenue increased by 40.2% to HKD305,616,607 (US$39,174,083) for the year ended December 31, 2022, from HKD217,943,422 for the year ended December 31, 2021.
Added
The increase was mainly caused by the increase in sales of private-labelled apparel products by 25.9% to HKD196,736,307 (US$25,327,485) for the year ended December 31, 2024, from HK$156,316,352 for the year ended December 31, 2023, which was mainly due to increase in number of commercial customers from 18 in 2023 to 21 customers in 2024 by the successful marking and promotional strategies such has social media marketing and promotional events and increase in sales of own-branded apparel products by 117.7% to HKD38,931,427 (US$5,011,963) for the year ended December 31, 2024, from HK$17,886,275 for the year ended December 31, 2023, which was mainly due to business expansion including establishment four more retail shops in London and led to increase in retail sales.
Removed
The increase was in correspondence to our increase of sales in revenue. 40 Gross profit and gross profit margin For the year ended December 31, 2021 2022 Product category Revenue Cost of revenue Gross profit Gross profit margin Revenue Cost of revenue Gross profit Gross profit margin HKD HKD HKD % HKD HKD HKD % Private(labelled apparel products 237,282,262 216,523,165 20,759,097 8.7 % 336,306,554 301,429,220 34,877,334 10.4 % Own(branded apparel products 3,254,265 1,420,257 1,834,008 56.4 % 11,145,014 4,187,387 6,957,627 62.4 % Total 240,536,527 217,943,422 22,593,105 9.4 % 347,451,568 305,616,607 41,834,961 12.0 % Our overall gross profit increased by 85.2% to HKD41,834,961 (US$5,362,425) for the year ended December 31, 2022, from HKD22,593,105 for the year ended December 31, 2021, primarily due to the increase in our revenue.
Added
Cost of revenue For the years ended December 31, 2023 2024 2024 HKD HKD US$ Private-labelled apparel products 134,239,759 178,307,992 22,955,056 Own-branded apparel products 4,914,557 7,915,189 1,018,987 Total 139,154,316 186,223,181 23,974,043 Our cost of revenue increased by 33.8% to HKD186,223,181 (US$23,974,043) for the year ended December 31, 2024, from HKD139,154,316 for the year ended December 31, 2023.
Removed
Selling and marketing expenses For the years ended December 31, 2021 2022 2022 HKD HKD US$ Transportation costs 1,960,336 1,057,957 135,609 Marketing and displaying expenses 1,172,758 1,573,274 201,663 Total selling and marketing expenses 3,133,094 2,631,231 337,272 Our selling and marketing expenses decreased by 16.0% to HKD2,631,231 (US$337,272) for the year ended December 31, 2022, from HKD3,133,094 for the year ended December 31, 2021, primarily due to decrease in transportation costs as the ocean freight rates decreased in 2022 after the surge in 2021, which were partially offset by the increase in marketing and displaying expenses due to the increase in marketing activities in 2022 to increase our brand awareness and the opening of an additional retail shop in London in 2022.
Added
The increase was in correspondence to our increase of sales in revenue. 37 Gross profit and gross profit margin For the year ended December 31, 2023 2024 Product category Revenue Cost of revenue Gross profit Gross profit margin Revenue Cost of revenue Gross profit Gross profit margin HKD HKD HKD % HKD HKD HKD % Private-labelled apparel products 156,316,352 134,239,759 22,076,593 14.1 % 196,736,307 178,307,992 18,428,315 9.4 % Own-branded apparel products 17,886,275 4,914,557 12,971,718 72.5 % 38,931,427 7,915,189 31,016,238 79.7 % Total 174,202,627 139,154,316 35,048,311 20.1 % 235,667,734 186,223,181 49,444,553 21.0 % Our overall gross profit increased by 41.1% to HKD49,444,553 (US$6,365,405) for the year ended December 31, 2024, from HKD35,048,311 for the year ended December 31, 2023, primarily due to the increase in our revenue in sales of own-branded apparel products in UK as the Company newly established 4 retail shops.
Removed
General and administrative expenses For the years ended December 31, 2021 2022 2022 HKD HKD US$ Staff costs 6,324,017 12,436,317 1,592,175 Rental and office expenses 2,486,443 3,205,017 410,326 Insurance 743,218 59,595 7,630 Amortization of intangible assets 151,634 137,358 17,585 Depreciation 136,236 11,114 1,423 Legal and professional fee 623,530 3,654,819 467,913 Management fee 4,223,236 — Others 298,546 764,197 97,837 14,986,860 20,268,417 2,594,889 41 Our general and administrative expenses increased by 35.2% to HKD20,268,417 (US$2,598,015) for the year ended December 31, 2022, from HKD14,986,860 for the year ended December 31, 2021, the increase was principally due to the increase in staff costs due to increase in headcount to cope with the business recovery and expected business expansion, rental and office expenses due to (i) the increase in contingent rent following the increase in revenue from retail shops in London; and (ii) the increase in office expenses to cope with our business activities and expansion upon post-COVID recovery of economy and restoration of business, and legal and professional fee as we engaged professionals to assist us in the preparation for our IPO project.
Added
Selling and marketing expenses For the years ended December 31, 2023 2024 2024 HKD HKD US$ Transportation costs 333,257 1,177,462 151,584 Marketing and displaying expenses 2,799,020 3,215,059 413,902 Total 3,132,277 4,392,521 565,486 Our selling and marketing expenses increased by 40.2% to HKD4,392,521 (US$565,485) for the year ended December 31, 2024, from HKD3,132,277 for the year ended December 31, 2023, primarily due to increase in marketing and displaying expenses due to business expansion including open up of new retail shops in the UK as a result of increase in sales.
Removed
The increase was principally attributable to the increase in financing activities and the increase in interest rate during the year ended December 31, 2022.
Added
General and administrative expenses For the years ended December 31, 2023 2024 2024 HKD HKD US$ Staff costs 13,260,898 18,486,483 2,379,917 Depreciation 3,260,273 4,551,567 585,961 Amortization 112,049 1,481,738 190,756 Provision for expected credit losses 1,383,316 1,253,368 161,356 Professional fee 2,204,622 2,840,139 365,634 Others 2,648,351 4,867,313 626,610 Total 22,869,509 33,480,608 4,310,234 Our general and administrative expenses increased by 46.4% to HKD33,480,608 (US$4,310,234) for the year ended December 31, 2024, from HKD22,869,509 for the year ended December 31, 2023, the increase was principally due to (i) the business expansion including open-up of four new retail shops in the UK which led to the increase in staff cost, lease expenses and overall general administrative expenses, (ii) increase in amortization of intangible assets as acquisition of trademarks in 2024, (iii) increase in expected credit loss and impairment losses on receivables and (iv) increase in legal and professional fee for the audit fee and business expansion consultation.
Removed
Other income For the years ended December 31, 2021 2022 2022 HKD HKD US$ Government subsidies 2,313,438 — — Agency income 2,904,339 2,586,019 331,477 5,217,777 2,586,019 331,477 Our other income decreased by 50.4% to HKD2,586,019 (US$331,477) for the year ended December 31, 2022, from HKD5,217,777 for the year ended December 31, 2021, principally due to decrease in government subsidies because no government subsidies were received during the year ended December 31, 2022.
Added
The decrease was mainly due to (i) repayment of bank borrowings and (ii) decrease in weighted average interest rate. 38 Other income For the years ended December 31, 2023 2024 2024 HKD HKD US$ Agency income 2,662,034 1,170,664 150,709 Other 326 134,230 17,280 Total 2,662,360 1,304,894 167,989 Our agency income representing service fee charged to a related party, NCH, for promoting NCH’s products in UK, it decreased by 56.0% to HKD1,170,664 (US$150,709) for the year ended December 31, 2024 from HKD2,662,034 for the year ended December 31, 2023.
Removed
There were no unfulfilled conditions or other contingencies relating to the government subsidies. Our agency income represented service fee charged to a related party, NCH, for promoting NCH’s products in UK. Agency income remained relatively stable at HKD2,904,339 and HKD2,586,019 (US$331,477) for the year ended December 31, 2021, and 2022, respectively.
Added
The decrease was principally in correspondence with the decrease in the discretionary income from Neo-Concept UK in 2024.
Removed
Other expenses For the years ended December 31, 2021 2022 2022 HKD HKD US$ Exchange loss, net (5,953 ) (7,444 ) (954 ) (5,953 ) (7,444 ) (954 ) Our other expenses remained relatively stable at HKD5,953 and HKD7,444 (US$954) for the year ended December 31, 2021, and 2022, respectively.
Added
Other expenses For the years ended December 31, 2023 2024 2024 HKD HKD US$ Exchange loss, net (168,356 ) — — Penalty (134,428 ) — — Total (302,784 ) — — Our other expenses decreased by 100% to nil for the year ended December 31, 2024, from HKD302,784 for the year ended December 31, 2023.
Removed
Provision for income tax expense The following table sets forth a breakdown of provision for income tax expense for the years ended December 31, 2022 and 2021: For the Years ended December 31, 2021 2022 2022 HKD HKD US$ Current: Hong Kong 1,742,282 2,979,918 381,967 1,742,282 2,979,918 381,967 Total provision for income taxes 1,742,282 2,979,918 381,967 Provision for income tax expense represents current profit tax.
Added
Provision for income tax expense For the Years ended December 31, 2023 2024 2024 HKD HKD US$ Current: Hong Kong 928,973 348,835 44,908 UK 388,288 — — 1,317,261 348,835 44,908 Deferred: Hong Kong 7,876 (206,806 ) (26,623 ) UK — 943,880 121,513 Total 1,325,137 1,085,909 139,798 Provision for income tax expense represents current profit tax.
Removed
Current profit tax represented tax recorded in Hong Kong. Hong Kong current profit tax arose from the operation of Neo(Concept HK in Hong Kong and its applicable tax rate is 16.5%.
Added
Our income tax expense decreased by 18.1% to HKD1,085,909 (US$139,798) for the year ended December 31, 2024 from HKD1,325,137 for the year ended December 31, 2023, mainly due to the tax loss utilization by the subsidiary, Neo-Concept (UK) Limited.
Removed
Our income tax expense increased by 71.0% to HKD2,979,918 (US$381,967) for the year ended December 31, 2022 from HKD1,742,282 for the year ended December 31, 2021, mainly due to the increase in assessable profit.
Added
Net income Our net income increased by 82.6% to HKD8,063,331 (US$1,038,059) for the year ended December 31, 2024, from HKD4,414,733 for the year ended December 31, 2023.
Removed
Net income Our net income increased by 173.6% to HKD14,914,678 (US$1,911,771) for the year ended December 31, 2022, from HKD5,450,515 for the year ended December 31, 2021. The increase in net income was predominantly due to the increase in our revenue in 2022. 42 B.
Added
We generally grant our customers a credit period ranging from 30 to 60 days, depending on their reputation, transaction history and the products purchased. Our accounts receivable increased by 5.6% to HKD34,169,661 (US$4,398,943) as of December 31, 2024, from HKD32,343,592 as of December 31, 2023, the Company utilize factoring to maintain the stability of accounts receivable.
Removed
Accounts payable Our accounts payable mainly related to the purchase of apparel products from our suppliers. Our suppliers usually granted us a credit period between 30 and 60 days.
Added
The increase was primarily attributable to the increase in prepayments to suppliers to secure our supplies for production and business which partially offset against the decrease in deferred IPO cost upon listing. Our prepayment and other current assets increased by 361.7% to HKD20,225,722 (US$2,589,425) as of December 31, 2023, from HKD4,380,864 as of December 31, 2022.
Removed
Changes in operating assets and liabilities mainly include (i) the increase in accounts payable of HKD32,554,096 (US$4,173,816) which was in line with the increase in our cost of revenue; and (ii) the increase in tax payable of HKD1,742,282 (US$223,381) due to more assessable profit generated by Neo-Concept HK as a result of the increase in revenue during the year, and partially offset by (i) increase in accounts receivables of HKD29,744,236 (US$3,813,559); and (ii) the increase in other current assets, net of HKD589,596 (US$75,593) which was primarily attributable to the deferred IPO costs as we engaged professionals to assist us in preparation for our IPO project.
Added
During the years ended December 31, 2022, 2023 and 2024, our obsolete and slow-moving inventories amounted to nil, HKD68,536 and HKD23,585, respectively.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

42 edited+10 added−25 removed25 unchanged
The ultimate decision of the appointment will be based on merit and the contribution which the selected candidates will bring to our Board. Our directors have a balanced mix of knowledge and skills. We will have three independent directors with different industry backgrounds, representing a majority of the members of our board.
The ultimate decision of the appointment will be based on merit and the contribution which the selected candidates will bring to our Board. Our directors have a balanced mix of knowledge and skills. We have three independent directors with different industry backgrounds, representing a majority of the members of our board.
We may choose to take advantage of the following exemptions afforded to foreign private issuers: ● Exemption from filing quarterly reports on Form 10-Q, from filing proxy solicitation materials on Schedule 14A or 14C in connection with annual or special meetings of shareholders, or from providing current reports on Form 8-K disclosing significant events within four (4) days of their occurrence, and from the disclosure requirements of Regulation FD. ● Exemption from Section 16 rules regarding sales of Ordinary Shares by insiders, which will provide less data in this regard than shareholders of U.S. companies that are subject to the Exchange Act. ● Exemption from the Nasdaq rules applicable to domestic issuers requiring disclosure within four (4) business days of any determination to grant a waiver of the code of business conduct and ethics to directors and officers.
We may choose to take advantage of the following exemptions afforded to foreign private issuers: ● Exemption from filing quarterly reports on Form 10-Q, from filing proxy solicitation materials on Schedule 14A or 14C in connection with annual or special meetings of shareholders, or from providing current reports on Form 8-K disclosing significant events within four (4) days of their occurrence, and from the disclosure requirements of Regulation FD. ● Exemption from Section 16 rules regarding sales of Class A Ordinary Shares by insiders, which will provide less data in this regard than shareholders of U.S. companies that are subject to the Exchange Act. ● Exemption from the Nasdaq rules applicable to domestic issuers requiring disclosure within four (4) business days of any determination to grant a waiver of the code of business conduct and ethics to directors and officers.
Wai joined the Bonds Group of Companies as an administration secretary in the international trades division. From 1986 to 1990 she served as the administration manager in commercial projects section for Bonds Group of Companies. Ms.
In 1983, Ms. Wai joined the Bonds Group of Companies as an administration secretary in the international trades division. From 1986 to 1990 she served as the administration manager in commercial projects section for Bonds Group of Companies. Ms.
If we choose to do so, we may utilize these exemptions for as long as we continue to qualify as a foreign private issuer. Equity Compensation Plan Information We have not adopted any equity compensation plans. Outstanding Equity Awards at Fiscal Year-End As of December 31, 2023, December 31, 2022 and December 31, 2021, we had no outstanding equity awards.
If we choose to do so, we may utilize these exemptions for as long as we continue to qualify as a foreign private issuer. Equity Compensation Plan Information We have not adopted any equity compensation plans. Outstanding Equity Awards at Fiscal Year-End As of December 31, 2024, December 31, 2023 and December 31, 2022, we had no outstanding equity awards.
The audit committee is responsible for, among other things: ● selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm; ● reviewing with the independent registered public accounting firm any audit problems or difficulties and management’s responses; ● reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act; ● discussing the annual audited financial statements with management and the independent registered public accounting firm; ● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any special steps taken to monitor and control major financial risk exposures; ● annually reviewing and reassessing the adequacy of our audit committee charter; ● meeting separately and periodically with management and the independent registered public accounting firm; ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; and ● reporting regularly to the board. 50 Compensation Committee Our compensation committee will consist of Mr.
The audit committee is responsible for, among other things: ● selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm; ● reviewing with the independent registered public accounting firm any audit problems or difficulties and management’s responses; ● reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act; ● discussing the annual audited financial statements with management and the independent registered public accounting firm; ● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any special steps taken to monitor and control major financial risk exposures; ● annually reviewing and reassessing the adequacy of our audit committee charter; ● meeting separately and periodically with management and the independent registered public accounting firm; ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; and ● reporting regularly to the board. 51 Compensation Committee Our compensation committee consists of Mr.
Holders of our Ordinary Shares are entitled to one (1) vote per share and vote on all matters submitted to a vote of our shareholders, except as may otherwise be required by law. 52 We have determined beneficial ownership in accordance with the rules of the SEC.
Holders of our Class A Ordinary Shares are entitled to one (1) vote per share and vote on all matters submitted to a vote of our shareholders, except as may otherwise be required by law. 53 We have determined beneficial ownership in accordance with the rules of the SEC.
Lau obtained a degree of Master of Science in Corporate Governance and Directorship (Distinction) from Hong Kong Baptist University in November 2014. He also obtained the HKICPA Diploma in Insolvency awarded by The Hong Kong Institute of Certified Public Accountants in June 2004. Mr.
Lau earned a Master of Science degree in Corporate Governance and Directorship (Distinction) from Hong Kong Baptist University in November 2014. He also obtained the HKICPA Diploma in Insolvency from The Hong Kong Institute of Certified Public Accountants in June 2004. Mr.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. Directors and senior management. The following table provides information regarding the executive officers and directors of the Company as of the date of this report: Directors and Executive officers Age Position Ms. Eva Yuk Yin Siu 62 Director, Chairlady of the Board, Chief Executive Officer Ms. Man Chi Wai 66 Director Mr.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. Directors and senior management. The following table provides information regarding the executive officers and directors of the Company as of the date of this report: Directors and Executive officers Age Position Ms. Eva Yuk Yin Siu 63 Director, Chairlady of the Board, Chief Executive Officer Ms. Man Chi Wai 67 Director Mr.
From October 2019 to February 2021, Mr. Singer served as the President and part-time Chief Operations Officer at KBL Group International. Since October 2021, Mr. Singer serves as part-time Chief Operations Officers at Sophie Loo Jacobsen, a company engaged in sale of glass homeware both direct to consumer and to key wholesale accounts in US, Europe, UK and Australia.
Singer served as the President and part-time Chief Operations Officer at KBL Group International. Since October 2021, Mr. Singer serves as part-time Chief Operations Officers at Sophie Loo Jacobsen, a company engaged in sale of glass homeware both direct to consumer and to key wholesale accounts in US, Europe, UK and Australia. Since March 2022, Mr.
Lau was also an independent non-executive director of Jinhai International Group Holdings Limited (HKSE: 2225) from September 2017 to June 2020 and Sundy Service Group Co. Ltd (HKSE: 9608) from December 2020 to January 2024. Mr.
Lau was also an independent non-executive director of Jinhai International Group Holdings Limited (HKSE: 2225) from September 2017 to June 2020, Sundy Service Group Co. Ltd (HKSE: 9608) from December 2020 to January 2024 and FDB Holdings Limited (HKSE: 1826) from January 2018 to January 2025. Mr.
Board Diversity Matrix (As of May 14, 2024) Country of Principal Executive Offices Hong Kong Foreign Private Issuer Yes Disclosure Prohibited Under Home Country Law No Total Number of Directors 5 Part I: Gender Identity Female Male Non-Binary Did Not Disclose Gender Directors 1 4 0 0 Part II: Demographic Background Underrepresented Individual in Home Country Jurisdiction 0 0 0 0 LGBTQ+ 0 0 0 0 51 Foreign Private Issuer Exemption We are a “foreign private issuer,” as defined by the SEC.
Board Diversity Matrix (As of May 14, 2025) Country of Principal Executive Offices Hong Kong Foreign Private Issuer Yes Disclosure Prohibited Under Home Country Law No Total Number of Directors 5 Part I: Gender Identity Female Male Non-Binary Did Not Disclose Gender Directors 3 2 0 0 Part II: Demographic Background Underrepresented Individual in Home Country Jurisdiction 0 0 0 0 LGBTQ+ 0 0 0 0 52 Foreign Private Issuer Exemption We are a “foreign private issuer,” as defined by the SEC.
Wai is primarily responsible for assisting the Chairlady of our Board with the overall management and operations of NCI and its subsidiaries. In October 1992 she co-founded Neo-Concept HK and has served as its director since October 1992. In August 2000 she also co-founded Neo-Concept UK. In 1983, Ms.
Man Chi Wai has served as a Director since July 2021. Ms. Wai is primarily responsible for assisting the Chairlady of our Board with the overall management and operations of NCI and its subsidiaries. In October 1992 she co-founded Neo-Concept HK and has served as its director since October 1992. In August 2000 she also co-founded Neo-Concept UK.
We will also achieve gender diversity by having one female independent director out of the total of three independent directors, as well as Ms. Lau. Our board is well balanced and diversified in alignment with the business development and strategy of NCI and our subsidiaries.
We also achieved gender diversity by having one female independent director out of the total of three independent directors. Our board is well balanced and diversified in alignment with the business development and strategy of NCI and our subsidiaries.
Outstanding Equity Awards at Fiscal Year-End As of December 31, 2023, December 31, 2022 and December 31, 2021, we had no outstanding equity awards. 49 C. Board Practices.
Outstanding Equity Awards at Fiscal Year-End As of December 31, 2024, December 31, 2023 and December 31, 2022, we had no outstanding equity awards. 50 C. Board Practices.
Nominating and Corporate Governance Committee Our nominating and corporate governance committee will consist of Mr. To Wai Suen, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Mr. Mark Gary Singer. We have determined that each of these directors satisfies the “independence” requirements of the Nasdaq Listing Rules.
Nominating and Corporate Governance Committee Our nominating and corporate governance committee will consist of Mr. Billy Chun Fai Tang, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Mr. Mark Gary Singer. We have determined that each of these directors satisfies the “independence” requirements of the Nasdaq Listing Rules.
To Wai Suen, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Ms. Josephine Yan Yeung. We have determined that each of these directors satisfies the “independence” requirements of the Nasdaq Listing Rules.
Billy Chun Fai Tang, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Mr. Billy Chun Fai Tang. We have determined that each of these directors satisfies the “independence” requirements of the Nasdaq Listing Rules.
Lewis is the sister of Ms. Siu. Family Relationships Save as disclosed above, none of our directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K. B. Compensation. For the year ended December 31, 2023, we paid an aggregate of HKD 3,556,750 in cash (including salaries and mandatory provident fund) to our directors.
Family Relationships Save as disclosed above, none of our directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K. B. Compensation. For the year ended December 31, 2024, we paid an aggregate of HKD 2,037,625 in cash (including salaries and mandatory provident fund) to our directors.
To Wai Suen qualifies as an “audit committee financial expert.” The audit committee oversees our accounting and financial reporting processes and the audits of our financial statements.
Josephine Yan Yeung qualifies as an “audit committee financial expert.” The audit committee oversees our accounting and financial reporting processes and the audits of our financial statements.
Josephine Yeung Yan (2) — — All directors and executive officers as a group (6 individuals) 14,918,870 73.4 % 5% principal shareholders: Ms.
Josephine Yeung Yan — — — — All directors and executive officers as a group (6 individuals) 14,918,870 71.05 % 14,918,870 90.08 % 5% principal shareholders: Ms.
Man Chi Wai, a Director of the Company, owns the entire issued share capital of Ultra Sky Group Holdings Limited. Ultra Sky Group Holdings Limited, a company incorporated in the BVI with limited liability, holds 2.37% of the issued shares of Splendid Vibe Limited.
Ultra Sky Group Holdings Limited, a company incorporated in the BVI with limited liability, holds 2.37% of the issued shares of Splendid Vibe Limited. Splendid Vibe Limited, a company incorporated in the BVI with limited liability, owns the entire issued share capital of Ample Excellence Limited and Neo-Concept (BVI) Limited.
Ms. Yeung served as a joint company secretary member of Sunlight (1977) Holdings Limited (HKSE: 8451) from April 2018 to May 2019. She also served as a company secretary of Tu Yi Holding Company Limited (HKSE: 1701) from June 2019 to June 2020. Key Employees Ms. Harriet Lewis is the managing director of Neo-Concept UK. Ms.
Ms. Yeung served as a joint company secretary member of Sunlight (1977) Holdings Limited (HKSE: 8451) from April 2018 to May 2019. She also served as a company secretary of Tu Yi Holding Company Limited (HKSE: 1701) from June 2019 to June 2020.
Lau has been a member of The Hong Kong Institute of Certified Public Accountants and a fellow member of the Association of Chartered Certified Accountants since July 2003 and December 2007, respectively. He has also been a member of Beta Gamma Sigma Hong Kong, an international honor society for collegiate schools of business since April 2014. Mr.
Lau has been a member of The Hong Kong Institute of Certified Public Accountants since July 2003 and a fellow member of the Association of Chartered Certified Accountants since December 2007. He is a member of Beta Gamma Sigma Hong Kong since April 2014. Mr.
Unless otherwise indicated, the person identified in this table has sole voting and investment power with respect to all shares shown as beneficially owned by him, subject to applicable community property laws. Ordinary Shares beneficially held Directors Number of Ordinary Shares Approximate percentage of outstanding Ordinary Shares Directors and executive officers (1) Ms.
Unless otherwise indicated, the person identified in this table has sole voting and investment power with respect to all shares shown as beneficially owned by him, subject to applicable community property laws.
Wai has more than 30 years of experience in the fashion garment industry and holds extensive operational and insights that have considerably contributed to our fast growth and unique corporate culture. Ms. Wai obtained a Higher Diploma of Business Studies in the Polytechnic College in 1979. Mr.
Wai has more than 30 years of experience in the fashion garment industry and holds extensive operational and insights that have considerably contributed to our fast growth and unique corporate culture. Ms. Wai obtained a Higher Diploma of Business Studies. Mr. Patrick Kwok Fai Lau has served as our Chief Financial Officer since May 2022. Mr.
Since March 2022, Mr. Singer serves as part-time Chief Operations Office at Love, SVW, a start-up that will be based in New York and engage in sale of accessories. Mr. Singer has extensive experience in providing long term growth strategies. Mr.
Singer serves as part-time Chief Operations Office at Love, SVW, a start-up that will be based in New York and engage in sale of accessories. Mr. Singer has extensive experience in providing long term growth strategies. Mr. Singer obtained a Bachelor of Arts’ degree in History and Economics from Colgate University, Hamilton, New York in June 1979. Mr.
We have determined that each of these three director nominees satisfies the “independence” requirements of the Nasdaq Listing Rules and meet the independence standards under Rule 10A-3 under the Securities Exchange Act of 1934, as amended. We have determined that Mr.
Mark Gary Singer and Mr. Billy Chun Fai Tang and is chaired by Ms. Josephine Yan Yeung. We have determined that each of these three director nominees satisfies the “independence” requirements of the Nasdaq Listing Rules and meet the independence standards under Rule 10A-3 under the Securities Exchange Act of 1934, as amended. We have determined that Ms.
Splendid Vibe Limited, a company incorporated in the BVI with limited liability, owns the entire issued share capital of Ample Excellence Limited and Neo-Concept (BVI) Limited. (5) Neo-Concept (BVI) Limited, a company incorporated in the BVI with limited liability, owns 72.6% of the issued Shares of the Company.
(4) Neo-Concept (BVI) Limited, a company incorporated in the BVI with limited liability, owns 72.6% of the issued Shares of the Company. (5) Ample Excellence Limited, a company incorporated in the BVI with limited liability, owns 8.9% of the issued Shares of the Company.
Singer was the Chief Executive Officer of Neo-Concept (NY) Corporation. In September 2014, Mr. Singer founded MGS Consulting Services, a consulting services firm based in New York that works with early to mid-cap direct to consumer and wholesaler companies within the fashion industry. Mr. Singer currently serves as the President of MGS Consulting Services.
Singer founded MGS Consulting Services, a consulting services firm based in New York that works with early to mid-cap direct to consumer and wholesaler companies within the fashion industry. Mr. Singer currently serves as the President of MGS Consulting Services. From October 2019 to February 2021, Mr.
Lau has been an independent non-executive director of Steering Holdings Limited (now known as FDB Holdings Limited) (HKSE: 1826) since January 2018, Ximei Resources Holding Limited (HKSE: 9936) since February 2020 and Zhongtian Construction (Hunan) Group Limited (HKSE: 2433) since March 2023. Mr.
Lau has been an independent non-executive director of Numans Health Food Holdings Company Limited (HKSE: 2530) since December 2024, Ximei Resources Holding Limited (HKSE: 9936) since February 2020 and Zhongtian Construction (Hunan) Group Limited (HKSE: 2433) since March 2023. Mr.
Patrick Kwok Fai Lau has served as our Chief Financial Officer since May 2022. Mr. Lau has been serving as the chief financial officer of Neo-Concept HK since December 2021. From September 2020 to November 2021, Mr. Lau was the chief financial officer of our affiliated company, NCH. Mr.
Lau has been serving as the chief financial officer of Neo-Concept HK since December 2021. From September 2020 to November 2021, Mr. Lau was the chief financial officer of our affiliated company, NCH. Mr. Lau possesses extensive expertise in accounting, auditing, financial advisory, and corporate governance.
From July 1996 to August 1998, Mr. Singer was Vice President of the Production and Product Development department at 17 North (Cable and Gauge label). From March 1998 to April 2002, Mr. Singer was the Director of Sales, Marketing and Product Development at Jones Apparel Group. From May 2002 to May 2013, Mr.
From May 1988 to June 1996, Mr. Singer worked at August Silk (formerly Diane Gilman) with his last position as Group Vice President of Sales, Production and Sourcing. From July 1996 to August 1998, Mr. Singer was Vice President of the Production and Product Development department at 17 North (Cable and Gauge label). From March 1998 to April 2002, Mr.
Asset Empire International Limited, a company incorporated in the BVI with limited liability, holds 87.71% of the issued shares of Splendid Vibe Limited. Splendid Vibe Limited, a company incorporated in the BVI with limited liability, owns the entire issued share capital of Ample Excellence Limited and Neo-Concept (BVI) Limited. (4) Ms.
(2) Ms. Eva Yuk Yin Siu, the chairlady of the Board, Chief Executive Officer, and a Director of the Company, owns the entire issued share capital of Asset Empire International Limited. Asset Empire International Limited, a company incorporated in the BVI with limited liability, holds 87.71% of the issued shares of Splendid Vibe Limited.
The following table sets forth information regarding the beneficial ownership of our Ordinary Shares as of the date of this report by our officers, directors, and 5% or greater beneficial owners of Ordinary Shares. There is no other person or group of affiliated persons known by us to beneficially own more than 5% of our Ordinary Shares.
The following table sets forth information regarding the beneficial ownership of our Class A Ordinary Shares as of the date of this report by our officers, directors, and 5% or greater beneficial owners of Class A Ordinary Shares.
Siu has more than 30 years of experience in the fashion garment industry and her fashion sense and insight into fashion trends have laid a strong foundation for our business. Ms. Siu attended the True Light Middle School, Hong Kong. 47 Ms. Man Chi Wai has served as a Director since July 2021. Ms.
Siu is also the founder and director of Neo-Concept (Holdings) Company Limited and some of its garment manufacturing subsidiaries. Ms. Siu has more than 30 years of experience in the fashion garment industry and her fashion sense and insight into fashion trends have laid a strong foundation for our business. 48 Ms.
We intend to adopt a charter for each of the three committees upon the establishment of the committees. Each committee’s members and functions are described below. Audit Committee Our audit committee will consist of Mr. To Wai Suen, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Mr. To Wai Suen.
Committees of the Board of Directors We established an audit committee, a compensation committee, and a nominating and corporate governance committee under the board of directors. We adopted a charter for each of the three committees. Each committee’s members and functions are described below. Audit Committee Our audit committee consisted of Ms. Josephine Yan Yeung, Mr.
Eva Yuk Yin Siu (3) 14,526,355 71.5 % Ms. Man Chi Wai (4) 392,515 1.9 % Mr. Patrick Kwok Fai Lau — — Mr. Mark Gary Singer (2) — — Mr. To Wai Suen (2) — — Ms.
Man Chi Wai (3) 321,415 2.37 % 392,515 2.37 % Mr. Patrick Kwok Fai Lau — — — — Mr. Mark Gary Singer — — — — Mr. Billy Chun Fai Tang — — — — Ms.
Lau held various positions, including deputy general manager, financial controller, and company secretary, in BII Railway Transportation Technology Holdings Company Limited (HKSE: 1522). From July 2016 to October 2019, Mr. Lau served as the chief financial officer and company secretary of International Alliance Financial Leasing Co., Ltd. (HKSE: 1563). Mr.
Between 1996 and 2011, he garnered valuable experience working in various international accounting firms, where he provided audit and financial advisory services. From 2011 to 2019, Mr. Lau held several key positions at BII Railway Transportation Technology Holdings Company Limited (HKSE: 1522) and International Alliance Financial Leasing Co., Ltd. (HKSE: 1563) respectively. Mr.
Singer has over 30 years of management experience spanning sales, supply chain, operations and logistical support for a wide range of companies from startups to medium cap. From May 1988 to June 1996, Mr. Singer worked at August Silk (formerly Diane Gilman) with his last position as Group Vice President of Sales, Production and Sourcing.
Mark Gary Singer is the independent Director, the Chairman of the Nominating and Corporate Governance Committees and a member of the Audit Committee and Compensation Committee of NCI. Mr. Singer has over 30 years of management experience spanning sales, supply chain, operations and logistical support for a wide range of companies from startups to medium cap.
Josephine Yan Yeung became our independent Director upon the effectiveness of the registration statement of which this report forms a part, and will serve as the Chairlady of Compensation Committee, a member of the Audit Committee and Nominating and Corporate Governance Committees of the Company. Ms.
Tang obtained a bachelor’s degree in business administration from The University of Massachusetts at Amherst, United States, in May 1996. 49 Ms. Josephine Yan Yeung served as independent Director, Chairlady of the Audit Committee and member of the Compensation Committee and Nominating and Corporate Governance Committees of the Company. Ms.
(1) Except as otherwise indicated below, the business address for our directors and executive officers is 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong. (2) Each of Mr. Mark Singer, Mr. To-Wai Suen and Ms.
Eva Yuk Yin Siu (2) 11,895,055 68.68 % 2,631,300 87.71 % Asset Empire International Limited (2)(6) 11,895,055 68.68 % 2,631,300 87.71 % Splendid Vibe Limited (2)(3)(6) 13,561,800 78.30 % 3,000,000 100.00 % Neo-concept (BVI) Limited (4)(6) 11,761,800 67.91 % 3,000,000 100.00 % Ample Excellence Limited (5)(6) 1,800,000 10.39 % — — (1) Except as otherwise indicated below, the business address for our directors and executive officers is 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong.
In October 1992 she co-founded Neo-Concept HK and has served as its director since October 1992. In August 2000 she also co-founded Neo-Concept UK. Neo-Concept HK and Neo-Concept UK, our operating subsidiaries, were established to intertwine the elements of fashion, where function, creativity, innovation, and craftsmanship are equally important and complementary with one another. Ms.
She is responsible for NCI’s overall management, operations, planning, and business development. In October 1992, she co-founded Neo-Concept International Company Limited and has been its director since December 1992. In August 2000, she also co-founded Neo-Concept (UK) Limited. These subsidiaries combine fashion, function, creativity, innovation and craftsmanship. Ms.
Eva Yuk Yin Siu has served as our Chairlady of the Board, and a Director since July 2021. Ms. Siu was also appointed our Chief Executive Officer in May 2022. Ms. Siu is primarily responsible for NCI and its subsidiaries’ overall management, formulating operation direction, devising annual plans, strategic planning and business development.
Patrick Kwok Fai Lau 52 Chief Financial Officer Mr. Billy Chun Fai Tang 52 Independent Director Mr. Mark Gary Singer 68 Independent Director Ms. Josephine Yan Yeung 43 Independent Director Ms. Eva Yuk Yin Siu served as Chairlady of the Board and Director of NCI since July 2021. In May 2022, she was appointed CEO.
Removed
Patrick Kwok Fai Lau 51 Chief Financial Officer Mr. To Wai Suen 49 Independent Director Nominee* Mr. Mark Gary Singer 66 Independent Director Nominee* Ms. Josephine Yan Yeung 42 Independent Director Nominee* * The proposed nominees will become Independent Directors of our Company upon the effectiveness of the registration statement of which this report forms a part. Ms.
Added
Singer was the Director of Sales, Marketing and Product Development at Jones Apparel Group. From May 2002 to May 2013, Mr. Singer was the Chief Executive Officer of Neo-Concept (NY) Corporation. In September 2014, Mr.
Removed
Siu is also a director of NCH, a company incorporated in Hong Kong in October 1990, as well as certain subsidiaries under the NCH group. NCH and its subsidiaries are a comprehensive garment service solutions provider that provides an array of services in the apparel supply chain, including textile and clothing manufacturing through its factories based in the PRC. Ms.
Added
Billy Chun Fai Tang served as independent Director, Chairman of the Compensation Committee and member of the Audit Committee and Nominating and Corporate Governance Committees of the Company. Mr. Tang is an executive Director of LFG Investment Holdings Limited (3938.hk), a company of which is listed on the Hong Kong Stock Exchange.
Removed
Lau has more than 20 years of experience in the fields of accounting, auditing, financial advisory and corporate governance. From September 1996 to November 1997, Mr. Lau worked as an auditor at Glass Radcliffe Chan & Wee, an accounting firm. From December 1997 to April 1999, Mr. Lau was an associate at PricewaterhouseCoopers. From October 1999 to June 2011, Mr.
Added
He was appointed as the executive Director on 1 April 2020. Mr. Tang joined LFG Investment Holdings Limited in December 2018 and is currently the managing director of Lego Corporate Finance Limited. Since June 2019, Mr.
Removed
Lau worked at served in various positions in KPMG, Hong Kong office, KPMG Huazhen (Guangzhou office) and KPMG Advisory (China) Limited, with his last position as a manager of KPMG Advisory (China) Limited, a consulting services company. From July 2011 to June 2016, Mr.
Added
Tang has acted as a Responsible Officer of Lego Corporate Finance Limited for Type 6 (advising on corporate finance) regulated activity under the SFO and a Licensed Representative of Lego Securities Limited for Type 1 (dealing in securities) regulated activity under the SFO. Mr. Tang has over 25 years of experience in the accounting and investment banking profession.
Removed
Mark Gary Singer became an independent Director upon the effectiveness of the registration statement of which this report forms a part and will be the Chairman of the Nominating and Corporate Governance Committees and a member of the Audit Committee and Compensation Committee. Mr.
Added
Prior to joining the Group, he worked at Goldin Financial Limited from July 2009 to December 2018 and his last position was the director of investment banking division and a Responsible Officer for Type 6 (advising on corporate finance) regulated activity.
Removed
Singer obtained a Bachelor of Arts’ degree in History and Economics from Colgate University, Hamilton, New York in June 1979. Mr.
Added
Prior to that, he had worked at Optima Capital Limited as a Responsible Officer for Type 6 (advising on corporate finance) regulated activity. He had also worked at BOCOM International Holdings Company Limited, Deloitte & Touche Corporate Finance Limited and PricewaterhouseCoopers. Mr.
Removed
To Wai Suen became an independent Director upon the effectiveness of the registration statement of which this report forms a part and will serve as the Chairman of the Audit Committee, a member of the Compensation Committee and Nominating and Corporate Governance Committees of the Company. Mr. Suen has over 18 years of experience in finance and accounting.
Added
There is no other person or group of affiliated persons known by us to beneficially own more than 5% of our Class A Ordinary Shares.
Removed
He is currently an independent director of MingZhu Logistics Holdings Limited, a company listed on NASDAQ (stock code: YGMZ) since September 2020.
Added
Class A Class B Ordinary Shares Ordinary Shares beneficially held beneficially held Approximate Approximate percentage of percentage of outstanding outstanding Number of Class A Number of Class B Directors Ordinary Shares Ordinary Shares Ordinary Shares Ordinary Shares Directors and executive officers (1) Ms. Eva Yuk Yin Siu (2) 11,895,055 68.68 % 2,631,300 87.71 % Ms.
Removed
Also, he is an independent non-executive director of Huajin International Holdings Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 2738), since March 2023 and Huisen Household International Group Limited, a company whose shares are listed on the Main Board of the Stock Exchange (stock code: 2127), since December 2020.
Added
Splendid Vibe Limited, a company incorporated in the BVI with limited liability, owns the entire issued share capital of Ample Excellence Limited and Neo-Concept (BVI) Limited. (3) Ms. Man Chi Wai, a Director of the Company, owns the entire issued share capital of Ultra Sky Group Holdings Limited.
Removed
In addition, he served an independent non-executive director of CT Environmental Group Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 1363), from February 2018 to April 2019. From April 2018 to January 2022, Mr.
Added
(6) The registered office address of each of these entities listed is Aegis Chambers, 1st Floor, Ellen Skelton Building, 3076 Sir Francis Drake’s Highway, Road Town, Tortola, VG1110, British Virgin Islands. F. Disclosure of a registrant’s action to recover erroneously awarded compensation. Not applicable. 54
Removed
Suen was also an independent director of China Zenix Auto International Limited (a company whose American depositary shares were previously listed on the New York Stock Exchange under the stock code “ZX” but was subsequently delisted in December 2018, and then was quoted on the over-the-counter markets under the stock code “ZXAIY” but was subsequently delisted in January 2022).
Removed
Since February 2020, he has also served as an independent non-executive director of Ping An Securities Group (Holdings) Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 231) which was subsequently delisted in November 2022 and from January 2024 to March 2024, he was an independent director of J-Long Group Ltd, a company listed on NASDAQ (stock code: JL).
Removed
Other than serving as an independent director, he served as the chief financial officer and company secretary of China Saite Group Company Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 153), from May 2015 to August 2016.
Removed
In addition, he served as the company secretary to certain companies including IDT International Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 167), from January 2017 to April 2017, China Smarter Energy Group Holdings Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 1004), from February 2017 to April 2019, and Asia Energy Logistics Group Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 351), from July 2020 to April 2021, respectively.
Removed
He also worked at an international audit firm from January 2001 to July 2013. Mr. Suen is a practising member of the Hong Kong Institute of Certified Public Accountants. He obtained a bachelor’s degree in commerce from The University of Western Australia in March 2001. We believe Mr.
Removed
Suen is well qualified to serve on our board of directors based on his extensive work experience in accounting and finance. 48 Ms.
Removed
Lewis joined our affiliated company, Neo-Concept (NY) Corporation and has served as its director and president since June 1999. Ms. Lewis has served as the director of Neo-Concept UK since August 2000. From May 1973 to August 1974, Ms. Lewis worked as a creative designer at Allied Advertising Agency. From September 1975 to August 1979, Ms.
Removed
Lewis worked at the Department of Printing at the Kwun Tong Technical institute, with her last position as an assistant lecturer. From September 1979 to December 1981, Ms. Lewis was a design coordinator and photographer at Myer Jewelry Mfr. Ltd. From January 1981 to May 1983, Ms. Lewis formed a partnership, Studio 3S, engaged in advertising and photography.
Removed
From June 1983 to June 2000, Ms. Lewis co-founded Brabo (Caribbean) Limited, as a manufacturer of plastic and fabric souvenirs. In November 1973, Ms. Lewis obtained a Higher Diploma in Industrial Design from the Hong Kong Polytechnic (currently, The Hong Kong Polytechnic University).
Removed
In July 1975, she also obtained a technical teachers certificate from Education Department of The Hong Kong Technical Teachers’ College. In January 1998, Ms. Lewis was awarded a certified diploma in small business administration from the Associate of Certified Book-keepers. Ms. Lewis has been admitted as a member of the Institute of Printing, United Kingdom since December 1981. Ms.
Removed
Committees of the Board of Directors Prior to the declaration of effectiveness of the registration statement of which this report forms a part, we intend to establish an audit committee, a compensation committee, and a nominating and corporate governance committee under the board of directors.
Removed
Eva Yuk Yin Siu (3) 14,526,355 71.5 % Asset Empire International Limited (3)(7) 14,526,355 71.5 % Splendid Vibe Limited (3)(4)(7) 16,561,800 81.5 % Neo-concept (BVI) Limited (5)(7) 14,761,800 72.6 % Ample Excellence Limited (6)(7) 1,800,000 8.9 % VIAPC 1 Limited (8) 1,642,930 8.1 % As of the date of this report, none of our outstanding Ordinary Shares are held by record holders in the United States.
Removed
Josephine Yan Yeung accepted their appointment as our independent non-executive director, from the effective date of our registration statement on Form F-1 for our IPO. (3) Ms. Eva Yuk Yin Siu, the chairlady of the Board, Chief Executive Officer, and a Director of the Company, owns the entire issued share capital of Asset Empire International Limited.
Removed
(6) Ample Excellence Limited, a company incorporated in the BVI with limited liability, owns 8.9% of the issued Shares of the Company. (7) The registered office address of each of these entities listed is Coastal Building, Wickham’s Cay II, P. O. Box 2221, Road Town, Tortola, VG1110, British Virgin Islands.
Removed
(8) VIAPC 1 Limited, a company incorporated in the Cayman Islands with limited liability, whose registered office address is at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands, owns 8.1% of the issued Shares of the Company. F. Disclosure of a registrant’s action to recover erroneously awarded compensation. Not applicable. 53

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

10 edited+4 added−15 removed5 unchanged
Siu ”) Chairman of the Board, Director, the Controlling Shareholder Neo-Concept (Holdings) Company Limited (“ NCH ”) A company under common control of the Controlling Shareholder Amounts Due From (To) Related Parties The following table set forth the breakdown of our balances due from related parties as of the dates indicated: As of December 31, As of June 30, 2021 2022 2023 2023 2023 2023 HKD HKD HKD US$ HKD US$ Due from Ms.
Siu ”) Chairman of the Board, Director, the Controlling Shareholder Neo-Concept (Holdings) Company Limited (“ NCH ”) A company under common control of the Controlling Shareholder Amounts Due From (To) Related Parties The following table set forth the breakdown of our balances due from related parties as of the dates indicated: As of December 31, Relationship 2022 2023 2024 2024 HKD HKD HKD US$ Due from (to) Ms.
Siu, the controlling shareholder of the Company. As of December 31, 2021 and 2022, the amount due from NCH was non-trade nature, being fund advance to NCH for its general operation. As of June 30, 2023 and December 31, 2023, the amount due to NCH was non-trade nature, being fund advance from NCH for general operation of the Company.
Siu, the controlling shareholder of the Company. As of December 31, 2022, the amount due from NCH was non-trade nature, being fund advance to NCH for its general operation. As of December 31, 2023 and 2024, the amount due to NCH and Ms. Siu was non-trade nature, being fund advance from NCH and Ms.
During the year ended December 31, 2022, the largest amount outstanding with the related parties was HK$100,000 due from Ms. Siu and HK$39,333,707 due from NCH. During the six months ended June 30, 2023, the largest amount outstanding with the related parties was HK$55,002 from Ms. Siu and HK$35,425,377 due to NCH.
During the year ended December 31, 2022, the largest amount outstanding with the related parties was HK$100,000 due from Ms. Siu and HK$39,333,707 due from NCH. During the year ended December 31, 2023, the largest amount outstanding with the related parties was HK$55,002 from Ms. Siu and HK$33,086,018 due to NCH.
The rates charged by NCH is consistent with the standard rates charged by Neo-Concept HK’s independent third-party supplier. We are of the opinion that the service fees paid to NCH, and the terms of service were negotiated at arm’s length.
The rates charged by NCH is consistent with the standard rates charged by Neo-Concept HK’s independent third-party supplier. We are of the opinion that the service fees paid to NCH, and the terms of service were negotiated at arm’s length. (4) On May 29, 2024, the Company entered into assets purchase agreement with a company controlled by Ms.
(3) Neo-Concept HK, together with NCH entered into banking facilities with Citibank, N.A., Hong Kong Branch for combined banking facilities which were shared by Neo-Concept HK and NCH. The banking facilities were secured, details of which are set out as follows: (a) Unlimited personal guarantee by Ms. Siu; (b) Ms.
Siu, entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH combinedly. The banking facilities were secured, details of which are set out as follows: (a) Unlimited personal guarantee by Ms. Siu; (b) Ms.
Siu has interests, at a relevant bank; (h) Indemnity granted by NCH to relevant banks; (i) Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD 131 million; and (j) Cross-corporate guaranteed by Neo-Concept HK and NCH.
Siu has interests, at a relevant bank; (h) Indemnity granted by NCH to relevant banks; (i) Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD131 million; and (j) Cross-corporate guaranteed by Neo-Concept HK and NCH; (ii) The banking facilities were secured, details of which are set out as follows: (a) Personal guarantee by Ms.
Policies and Procedures for Related Party Transactions Our board of directors has created an audit committee and adopted an audit committee charter, which requires the committee to review and approve of all related party transactions. 56 C. Interests of Experts and Counsel Not applicable.
Siu, and NCH; and (c) Legal charge over certain deposits accounts held by NCH at the relevant banks; Policies and Procedures for Related Party Transactions Our board of directors has created an audit committee and adopted an audit committee charter, which requires the committee to review and approve of all related party transactions. C.
Siu 100,000 70,001 55,002 7,042 55,002 7,019 Due to NCH (1) — — 29,724,263 3,805,485 28,620,040 3,652,239 Due from NCH 7,242,784 16,202,732 — — — — The amounts due from (to) the related parties are unsecured, interest free with no specific repayment terms. Neo-Concept (Holdings) Company Limited (“NCH”) is a company incorporated in Hong Kong and controlled by Ms.
Siu Controlling Shareholder 70,001 (59,106 ) — — Due from (to) NCH Common controlled by Ms. Siu 16,202,732 (34,184,138 ) (638,243 ) (82,167 ) The amounts due from (to) the related parties are unsecured, interest free with no specific repayment terms. Neo-Concept (Holdings) Company Limited (“NCH”) is a company incorporated in Hong Kong and controlled by Ms.
As at the date of this report, the balance due from Ms. Siu was HK$55,002. The amount due from Ms. Siu was fully repaid upon the Company’s IPO. On June 30, 2023, NCH agreed to forgive HKD 55 million (US$7.02 million) due to NCH by the Company. The amount was credited to additional paid-in capital.
Siu for general operation of the Company. On June 30, 2023, NCH agreed to forgive HKD 55 million (US$7.02 million) due to NCH by the Company. The amount was credited to additional paid-in capital. The amount forgiven represented funds transferred from NCH to the Company to support the general operation of the Company during year ended December 31, 2023.
Siu and HK$33,086,018 due to NCH. 54 Transactions with Related Parties Related party transactions during the three years ended December 31, 2021, 2022 and 2023 For the Years Ended December 31, Nature 2021 2022 2022 2023 2023 HKD HKD USD HKD USD Neo-Concept (Holdings) Company Limited (1) Management fee (2) 4,223,236 — — — — Neo-Concept (Holdings) Company Limited (1) Rental expense (3) — 720,000 92,290 720,000 92,179 Neo-Concept (Holdings) Company Limited (1) Purchase of apparel products (4) 29,522,341 103,159,420 13,223,024 38,351,844 4,910,042 Neo-Concept (Holdings) Company Limited (1) Agency income received (5) 2,904,339 2,586,019 331,477 2,705,234 346,341 (1) An affiliate company incorporated in Hong Kong indirectly wholly-owned by the Controlling Shareholders.
During the year ended December 31, 2024, the largest amount outstanding with the related parties was HK$638,243 due to NCH. 55 Transactions with Related Parties Related party transactions during the three years ended December 31, 2022, 2023 and 2024 For the years ended December 31, 2022 2023 2024 2024 HKD HKD HKD US$ Neo-Concept (Holdings) Company Limited (1) Rental expense (2) 2,586,019 2,662,034 1,170,664 150,709 Neo-Concept (Holdings) Company Limited (1) Purchase of apparel products (3) 103,159,420 34,213,521 7,915,189 1,018,987 Neo-Concept (Holdings) Company Limited (1) Purchase of intangible assets (4) — — 15,023,180 1,934,057 Neo-Concept (Holdings) Company Limited (1) Agency income received (5) 720,000 720,000 720,000 92,692 (1) An affiliate company incorporated in Hong Kong indirectly wholly-owned by the Controlling Shareholders.
Removed
The amount forgiven represented funds transferred from NCH to the Company to support the general operation of the Company during the six months period ended June 30, 2023.
Added
Siu, Neo-Concept (Holdings) Company Limited, to purchase the trademark at a consideration of HK$15,023,180 (US$1,931,000). The trademarks are brand names which filed in Hong Kong, the Mainland China, the European Union, the US, Qatar and the United Arab Emirates.
Removed
Accounts payable — related party The following table set forth the breakdown of our accounts payable — related party as of the dates indicated: As of December 31, As of June 30, 2021 2022 2023 2023 2023 2023 HKD HKD HKD US$ HKD US$ Due to NCH (1) — — 3,361,755 430,393 6,805,337 868,438 (1) NCH waived HKD 55 million from the amount owed to it during the six months ended June 30, 2023.
Added
(5) Agency income refers to other income received from NCH, which was a discretionary payment made to Neo-Concept UK for promoting NCH’s products in the UK upon a pre-determined yearly sale target being achieved. 56 Bank Facilities and Other Borrowing Bank borrowings as of December 31, 2023 and 2024 are as follows: Maturity Interest rate as of December 31, Interest rate as of December 31, As of December 31, Lender Type date Currency 2023 2024 2023 2024 2024 HKD HKD US$ DBS Bank (Hong Kong) Limited (i) Trading finance Within 1 year HKD 6.46 % — 5,884,863 — — The Hongkong and Shanghai Banking Corporation Limited (i) Trading finance Within 1 year HKD 7.14 % 6.05 % 21,568,885 8,579,162 1,104,466 OCBC (i) Trading finance Within 1 year HKD — 7.40 % — 2,400,446 309,029 China Construction Asia Bank (i) Trading finance Within 1 year HKD — 6.29 % — 10,645,199 1,370,444 Citibank, N.A., Hong Kong Branch (ii) Trading finance Within 1 year HKD 7.40 % 7.44 % 3,299,652 5,480,915 705,604 Total 30,753,400 27,105,722 3,489,543 Less: current maturities (30,753,400 ) (27,105,722 ) (3,489,543 ) Non-current maturities — — — (i) In connection with our operations in Hong Kong, Neo-Concept HK, together with a related company, Neo-Concept (Holdings) Company Limited (“NCH”), a company incorporated in Hong Kong and controlled by Ms.
Removed
The accounts payable to NCH as of December 31, 2023 and June 30, 2023 were unsecured, interest free with repayment on demand. During the year ended December 31, 2021, the largest amount outstanding with the related parties was HK$100,000 due from Ms. Siu and HK$35,676,751 due from NCH.
Added
Siu and an immediate family member of Ms. Siu; (b) Cross-corporate guaranteed by Neo-Concept HK, Neo-Concept (BVI) Limited, a company controlled by Ms.
Removed
During the year ended December 31, 2023, the largest amount outstanding with the related parties was HK$55,002 from Ms.
Added
Interests of Experts and Counsel Not applicable. 57
Removed
(2) Management fees, which included office overhead including rental and shared human resources expenses, were paid by Neo-Concept HK for use of the Hong Kong office located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong for the years ended December 31, 2021.
Removed
In December 2021, a group of employees of NCH were transferred to Neo-Concept HK and the arrangement for sharing human resource expenses was discontinued.
Removed
On January 1, 2022, Neo-Concept HK and NCH entered into an official rental agreement for use of the Hong Kong office and the rental fees were accounted for as rental expenses for the year ended December 31, 2022 and 2023.
Removed
(3) Rental expenses were paid by Neo-Concept HK for the lease of office premises located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong. (4) During the normal course of business, Neo-Concept HK engaged NCH as supplier to produce and arrange delivery of products for its customers.
Removed
(5) Agency income refers to other income received from NCH, which was a discretionary payment made to Neo-Concept UK for promoting NCH’s products in the UK upon a pre-determined yearly sale target being achieved.
Removed
Related party transactions during the six months ended June 30, 2022 and 2023 For the Six Months Ended June 30, Nature 2022 2023 2023 HKD HKD USD Neo-Concept (Holdings) Company Limited (1) Rental expense (2) 360,000 360,000 45,876 Neo-Concept (Holdings) Company Limited (1) Purchase of apparel products (3) 28,963,113 22,713,298 2,898,472 (1) An affiliate company incorporated in Hong Kong indirectly wholly-owned by the Controlling Shareholders.
Removed
The rates charged by NCH are consistent with the standard rates charged by Neo-Concept HK’s independent third-party supplier.
Removed
We are of the opinion that the service fees paid to NCH, and the terms of service were negotiated at arm’s length. 55 Bank Facilities and Other Borrowing Bank borrowings as at December 31, 2021, 2022 and 2023 and June 30, 2023 are as follows: Balance as at December 31, Balance as at June 30, Lender Type Maturity date Currency Interest rate 2021 2022 2022 2023 2023 2023 2023 HKD HKD US$ HKD US$ HKD US$ The Hongkong and Shanghai Banking Corporation Limited (1) Trading finance Within 1 year HKD Bank prevailing rates 27,472,039 44,500,679 5,704,118 — — 33,448,796 4,268,443 HSBC UK Bank plc (2) Term loan June 15, 2026 GBP 2.5% 525,615 375,059 48,075 — — — — DBS Bank (Hong Kong) Limited (1) Trading finance Within 1 year HKD Bank prevailing rates — 17,232,296 2,208,844 — — — — Dah Sing Bank, Limited (1) Overdraft Within 1 year HKD Bank prevailing rates — 22,229,451 2,849,382 — — 10,570,842 1,348,958 Citibank, N.A., Hong Kong Branch (3) Trading finance Within 1 year US$ Bank prevailing rates — — — 5,809,927 743,823 — — Total 27,997,654 84,337,485 10,810,419 5,809,927 743,823 44,019,638 5,617,401 (1) Neo-Concept HK, together with NCH entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH.
Removed
The banking facilities were secured, details of which are set out as follows: (a) Unlimited personal guarantee by Ms. Siu; (b) Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH; (c) Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms.
Removed
(2) The loan was obtained in June 2020 having a tenure of 6 years with a fixed interest rate of 2.5% per annum. It was made under the Bounce Back Loan Scheme managed by the British Government (“BBLS Guarantee”). The BBLS Guarantee provides a full repayment guarantee to the lender on the loan.
Removed
Siu and also assignment of rental from the properties and the car parking spaces; (d) Legal charge over certain deposits accounts held by NCH at the relevant banks; (e) Indemnity granted by NCH to relevant banks; and (f) Cross-corporate guaranteed by Neo-Concept HK and NCH.