Full Year 2023 Selected Financial Results
Revenues
Revenue decreased by HK$0.6 million, or 0.5%, to HK$119.1 million (US$15.2 million) for the fiscal year ended December 31, 2023 compared to HK$119.7 million for the same period in 2022 primarily because of the decrease in revenue for our curling wands and irons products.
The following table presented the Company's revenues by product types for the fiscal years ended December 2023 and 2022:
| For the years ended December 31, | |||||||||
| 2023 | 2022 | ||||||||
| Revenues | HK$ Million | HK$ Million | Variance % | ||||||
| Products | |||||||||
| Curling Wands and Irons | HK$ | 32.8 | HK$ | 38.3 | (14.5 | )% | |||
| Flat Irons and Hair Straighteners | 82.8 | 78.6 | 5.3 | % | |||||
| Others | 3.5 | 2.8 | 27.6 | % | |||||
| Total revenues | 119.1 | 119.7 | (0.5 | )% | |||||
The following table presented the Company's revenues by geographical areas based on the location of our sole customer for the fiscal years ended December 31, 2023 and 2022:
| For the years ended December 31, | |||||||||
| 2023 | 2022 | ||||||||
| Revenues | HK$ Million | HK$ Million | Variance % | ||||||
| Geographical areas | |||||||||
| Europe | HK$ | 65.4 | HK$ | 66.7 | (1.9 | )% | |||
| North America | 48.4 | 45.1 | 7.3 | % | |||||
| South America | - | 2.7 | (100 | )% | |||||
| Asia and others | 5.3 | 5.2 | 1.7 | % | |||||
| Total revenues | 119.1 | 119.7 | (0.5 | )% | |||||
Cost of sales
Cost of sales decreased to HK$97.0 million (US$12.4 million) for the fiscal year ended December 31, 2023, representing a decrease by HK$3.9 million from HK$100.9 million in the same period in 2022. The fluctuation of cost of sales was in line with the decrease in our revenue during the same period.
Gross profit
Gross profit for the fiscal year ended December 31, 2023, was HK$22.1 million (US$2.8 million), an increase of HK$3.3 million from HK$18.8 million for the same period in 2022.
During our fiscal year ended December 31, 2023, the COVID-19 Pandemic has been successfully brought under control and the adverse impacts of the pandemic have been gradually dissipating as economic activities resume to normal. The supply and prices of raw materials became stable during the year, and thus led to the decrease in the company's average unit costs and increase in gross profit for the year.
The Company's gross profit margin for fiscal year ended December 31, 2023 rose to 18.6% as compared to gross profit margin of 15.7% for the fiscal year ended December 31, 2022.
Selling and marketing expenses
Selling and marketing expenses was HK$2.0 million (US$0.3 million) for the fiscal year ended December 31, 2023, which decreased by HK$0.1 million from HK$2.1 million in the same period in 2022. The decrease during the fiscal year ended December 31, 2023 from the same period in 2022 was due mainly to a decrease in overall level of shipping of products.
General and administrative expenses
General and administrative expenses increased by HK$1.3 million to HK$20.5 million (US$2.6 million) for the fiscal year ended December 31, 2023 from HK$19.2 million for the fiscal year ended December 31, 2022. This increase was due mainly to the increase in staff costs and motor vehicles and travelling expenses as the travel restrictions of China and Hong Kong were lifted gradually during the fiscal year ended December 31, 2023.
Income (loss) from operations
Loss from operations decreased by HK$2.1 million to HK$0.4 million for the fiscal year ended December 31, 2023, from the loss from operations of HK$2.5 million for the fiscal year ended December 31, 2022. The improvement in the financial performance from operations during the fiscal year ended December 31, 2023 were primarily due to the combined effects of increase of gross profit of HK$3.4 million and the decrease of general and administrative expenses of HK$1.3 million during the fiscal year ended December 31, 2023.
Other income (expense), net
Major components of other income (expense) are exchange gain and loss, gain on disposal of property, plant and equipment, sundry income, government grant and bank interest income.
Other net income was HK$0.8 million (US$0.1 million) for the fiscal year ended December 31, 2023, which decreased by HK$12.2 million from HK$13.0 million in the same period in 2022. The decrease was due mainly to the decrease in gain on disposal of property, plant and equipment recognized during the fiscal year ended December 31, 2023.
Net income
The net income decreased by HK$10.1 million from a net income of HK$8.6 million for the year ended December 31, 2022 to a net loss of HK$1.5 million (US$0.2 million) for the fiscal year ended December 31, 2023. The decrease in the net income during the year ended December 31, 2023 was mainly attributable to the cumulative effect of the reasons set out above.
Recent development
The Company announced the closing of its initial public offering of 1,000,000 ordinary shares (the "Ordinary Shares") at a public offering price of $5.00 per share for total gross proceeds of $5,000,000, before deducting underwriting discounts and other offering expenses. The Ordinary Shares began trading on Nasdaq Capital Market on November 30, 2023, under the ticker symbol "FEBO".