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THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
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SUMMARY AND HIGHLIGHTS
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OVERVIEW
We are China’s No. 1 Cantonese hot pot chain restaurant. According to the F&S Report, both
of our revenue and number of restaurants ranked first in this sector in 2020, where we occupied
a 1.7% market share in terms of revenue. Our revenue increased from RMB1,094.8 million in
2019, to RMB1,124.8 million in 2020, and further to RMB1,299.8 million in 2021. Guided by our
slogan ‘‘Heavenly flavors, served with Love (用愛傳遞好味道),’’ we offer our customers the
ultimate experience of food and services, which allows us to be widely recognized in the Eastern
China market and has significantly contributed to our sustainable rapid restaurant expansion
nationwide. As of the Latest Practicable Date, we exclusively operated in Greater China; we had
149 non-franchised chain restaurants in 30 cities across mainland China and one restaurant in
Taipei, all of which were operated by our Group.
Cantonese hot pot distinguishes from traditional hot pot through its signature soup stock.
Unlike spicy Sichuan style hot pot, Cantonese hot pot focuses on its soup, which mainly consists
of edible ingredients. Savoring the soup is an essential dining experience when consuming
Cantonese hot pot. Although Cantonese hot pot is a small subset of China’s hot pot restaurant
and Chinese cuisine market, it offers a unique recipe and dining experience among China’s
expansive dining options. The Cantonese hot pot market is a large but highly fragmented market
with total revenue of RMB63.0 billion in 2020. According to the F&S Report, we occupied 1.7% of
market share while the second market player occupied 1.1% in 2020 in terms of revenue.
We aim to provide our customers with a great and distinctive hot pot experience like
enjoying a hot pot concerto — Laowang Concerto (撈王鍋物協奏曲) — that changes in tempo,
from Allegro, to Andante, and to Presto — three movements corresponding to our stewed chicken
and pork tripe soup (胡椒豬肚雞) as the Allegro, clay pot rice with Chinese sausage and Chinese
bacon (雙臘煲仔飯) as the Andante, and water chestnut and saccharin juice (馬蹄竹蔗水) as the
Presto, during which our customers become the audience.
We operate and manage three self-developed distinctive brands: Want Hotpot (撈王鍋物料
理), Guoji Hotpot (鍋季) and Soup for the Soul (撈王心靈肚雞湯). Our flagship Want Hotpot has its
brand orientation as classy upscale dining, Guoji Hotpot focuses on solo dining scenario, and
Soup for the Soul, a fast casual restaurant that offers quick and light dining for small gathering,
and caters to younger customers’ preferences.
–1–THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
We are a product-first company, upholding rigorous standards when it comes to food safety
and quality. We established a centralized facility, Laowang Gourmet Lab (中央工廠), for research
and development and for the production of certain ingredients to be supplied to our restaurants,
a centralized procurement system for handling purchase orders, and a stringent assessment and
accountability system where food safety is considered a KPI for our restaurant managers and
head chefs. Furthermore, we formulated rigorous standards for supplier selection, and have been
closely monitoring transportation and logistics operations through digital systems. As of the
Latest Practicable Date, more than 85% of our restaurants achieved A-excellent rating in local
authorities’ spot inspections, which is significantly higher than the industry average of only 10%.
We have been stepping up efforts to enhance our digital wisdom. We implement digital
systems to enable our headquarters to timely inspect, monitor and manage our restaurant
operations, which in turn helps our restaurants adjust their operations swiftly and effectively. As
of the Latest Practicable Date, our Members’ Club had gained and kept a plethora of customers
with over 9.3 million members, and among 1.4 million of them who indicated their age group,
around 72.0% of whom were under 35; the re-dining rate of our members within 90 days from the
first order was 14.4%.
We provide outstanding dining experience that wins us various awards and recognitions.
According to the F&S Report, as of July 2021, we earned the highest ranking by flavor, services
and atmosphere among all hot pot chain restaurant brands in China who own at least 20
restaurants; the 2019 China Catering Service Industry Annual Report 《中國餐飲報告(2019)》
( ) also
ranked us No. 1 among all hot pot restaurants with respect to the same criteria. China Hospitality
Association (中國飯店協會) awarded us Top Ten China’s Hot Pot Restaurant Brands in 2020 as a
testimony to our high-quality operations management. Popular food channel The Best Place to
Eat (去哪吃) selected us in its Best Brand Top 100 in 2021 as a recognition of our excellence in
popularity and operation. In addition, six restaurants of ours were listed as Dianping’s Must-try
Restaurants during the Track Record Period.
In addition, we have been proactively exploring other business operations in addition to
restaurant operations, including food delivery business and retail business, to cater to the
changing customers’ needs and the growing demand of ready-to-serve products. We commenced
our food delivery business by cooperating with third parties in 2018. As of the Latest Practicable
Date, we operated food delivery business in most of our restaurants across Greater China. We
strategically introduced our retail business in 2020 to sell the ready-to-serve stewed chicken and
pork tripe soup by collaborating with local and international supermarkets. To this end, we will
continue to strengthen our supply chain capability to prepare for further expansion in both food
delivery and retail businesses.
OUR CORE VALUE
Our core value is Love.
We commit to delivering heavenly flavors with Love, and love our customers, employees,
business partners, as well as shareholders.
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SUMMARY AND HIGHLIGHTS
OUR COMPETITIVE STRENGTHS
We are the largest Cantonese hot pot chain restaurant in China, well-positioned to enjoy the
strong momentum of the hot pot restaurant market.
According to the F&S Report, the Cantonese hot pot restaurant market is the fastest-growing
segment within the entire hot pot restaurant market in terms of revenue, which is primarily
attributable to its healthy appearance that meets the general public’s rising demand for a health-
conscious dining experience. In this segment, we were the fast-growing player among all five
largest non-franchised Cantonese hot pot chain restaurants during the Track Record Period. In
addition, as we ranked first and fourth in the Cantonese hot pot and hot pot restaurant market in
China in terms of revenue in 2020, we believe that we are well-positioned to benefit from the
growth of the hot pot restaurant market.
Our success story in penetrating the Eastern China market will facilitate our sustainable rapid
growth nationwide with impressive financial performance.
Since our inception, we have been penetrating the Eastern China market, which possesses
great potential among all regions in China for catering service businesses. Our success story in
Eastern China, our home field, will prepare us well for the rapid, sustainable expansion
nationwide. Moreover, by leveraging our well-established management system and standardized
operations, we have achieved, and expect to continue to achieve, industry-leading results of
operations and impressive financials.
We have structured a long-term viable business model to foster scalable growth.
Our experienced management team has established a highly standardized business model,
where we effectively manage our supply chains, systematically monitor our restaurants and
employees, and promptly diversify our revenue streams. Such a long-term viable business model
helps us reach a diversified customer base, with standardized food processing, standardized
operating instructions and large production capacity, enabling us to foster scalable growth.
Moreover, our ability to scale is attributable to our centralized food procurement and automated
production facility, strong supply chain management and systematic human resource
management.
We position ourselves as a healthy-eating gourmet chain restaurant that stands out from our
competitors.
We acknowledged and recognized the trend of healthy eating early on, as more people
demand healthy cooking methods and healthy ingredients when deciding where and what to eat.
We have been making proactive efforts to set up the Standard Operating Procedures, procure
high-quality ingredients and ensure efficient delivery to offer our customers healthy, farm-fresh,
high-quality and unique original cuisines. Committed to bringing natural taste and health to
customers, we differentiate ourselves from traditional spicy hot pot and make ourselves stand
out from our competitors.
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SUMMARY AND HIGHLIGHTS
Food safety and quality is of paramount importance to us.
To ensure food safety and quality throughout our business operations, we have set up a set
of policies, including a stringent accountability system, systematic procedures for our
headquarters to control and manage food safety, and comprehensive standards regarding
supplier selection and inspections of various supplies. Through such measures, as of the Latest
Practicable Date, a significant majority of our restaurants had met restaurants safe requirements
upon local authorities’ spot inspections and achieved an A-excellent rating.
We penetrated the younger generation by leveraging digital platforms.
We attach great significance to our branding within the younger generations and devised a
basket of our core value- and belief-oriented marketing strategies, such as collaboration with
marketing agencies, co-branding with various brands in multiple areas and consistently
improving our interactions with members of our Members’ Club. Consequently, we increased our
brand awareness among youngsters, generated leads, drove sales and profits, and accumulated
a plethora of customers within our Members’ Club.
Our experienced management team and ‘‘Loving’’ culture will ensure the successful
development of our business.
An experienced management team leads us with extensive industry expertise and visionary
leadership, providing in-depth industry knowledge in various areas. Under the guidance of our
executive Directors, Mr. Lee Yu-cheng (李裕成) and Mr. Liao Chih-wei (廖志偉), who both have
years of experience in the food industry, we had executed corporate strategies effectively and
multiplied into the largest Cantonese hot pot restaurant in China. We believe our positive and
dynamic ‘‘Loving’’ culture and our aligned team will ensure strategic execution and further propel
our future growth.
OUR BUSINESS STRATEGIES
With a commitment to deliver heavenly flavors with Love to our customers and to make
proactive efforts to pump up positive energy into their lives, we aim to proceed the following
strategies:
Maintain and strengthen our leading position and extend our restaurant network to new
geographic markets
According to the F&S Report, the number of shopping malls in China is expected to increase
to approximately 9,600 in 2025. Concerning the concession of restaurants, shopping malls are
likely to take into account offering customers diversified hot pot options where a majority of hot
pot restaurants offer spicy Sichuan hot pot. We, therefore, believe that there are tremendous
opportunities for us to expand throughout shopping malls and plan to open 44, 60 and 80
restaurants in 2022, 2023 and 2024, respectively, replicating our success story in Eastern China
on future restaurants expansion nationwide.
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SUMMARY AND HIGHLIGHTS
Further diversify and broaden our business operations through a multi-brand strategy
We operate and manage three distinctive brands, with each brand appeals to different
groups. Such a multi-brand strategy enables us to satisfy customers’ needs and reach diverse
audiences, bringing multiple benefits such as risk diversification and expansion with mitigated
risk of cannibalization. We will continue to grow our multi-brand strategy to increase our market
share in the catering service industry.
Steadily develop our retail business to capture new opportunities in the catering service
industry
Going forward, we expect to strengthen our offline retail presence through strategic
collaborations with boutique supermarkets and major convenience store chains. To integrate
offline and online retail businesses, we seek to unlock the world’s largest e-commerce market
through mainstream e-commerce platforms. Moreover, we plan to continuously develop
diversified ready-to-serve products and develop our retail business into a dynamic engine for
revenue growth.
Continue to strengthen our supply chain capability
We plan to establish Laowang Gourmet Lab 2 and lease regional refrigerated warehouses
across China in the near future to boost our production capacity and support expansion
nationwide significantly. We believe we can optimize efficiency in supply chain management and
standardize food supply with consistent food quality and food safety, significantly contributing to
our restaurant expansion across China.
OUR BUSINESS OPERATIONS
We are a non-franchised hot pot chain restaurant specializing in serving Cantonese hot pot.
In addition and as a supplement to our restaurant operations, we provide consumers with retail
and food delivery services.
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SUMMARY AND HIGHLIGHTS
Our Restaurant Operations
The following table sets forth the features and business scale of our restaurants by brand
as of the Latest Practicable Date:
Flagship Restaurant
Category Brand Other Restaurant Brands
Brand Want Hotpot Guoji Hotpot Soup for the Soul
Theme cuisines/dish . . . . . . Cantonese hot pot Mini hot pot Fast casual dining
Brand orientation . . . . . . . . Classy upscale Stylish solo dining and Quick and light dining for
dining convenient gathering small gathering
Target customers . . . . . . . . . Younger customers, Younger customers Younger customers
families and groups
Average spending
per customer
2021 . . . . . . . . . . . . . . . . RMB124.4 RMB109.9 RMB108.7
2020 . . . . . . . . . . . . . . . RMB128.1 RMB99.0 RMB101.6
2019 . . . . . . . . . . . . . . . RMB123.7 — —
GFA per restaurant 300 to 700 165 to 213 190 to 300
. . . . . . . . . . . . . . . . . . . square meters square meters square meters
Number of restaurants as of
the Latest Practicable
Date . . . . . . . . . . . . . . . . 146 2 2
We opened 149 restaurants under these three distinctive brands in 30 cities in mainland
China and one restaurant in Taipei as of the Latest Practicable Date. The number of our
restaurants increased from 77 as of 1 January 2019 to 148 as of 31 December 2021, and further
increased to 150 as of the Latest Practicable Date. We owned and operated 146 Want Hotpot
restaurants, two Guoji Hotpot restaurants and two Soup for the Soul restaurants in Greater China
as of the Latest Practicable Date. Most of our restaurants are located in upscale shopping malls.
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SUMMARY AND HIGHLIGHTS
The following table sets forth the movement in the number of our restaurants during the Track
Record Period and up to the Latest Practicable Date:
From
1 January 2022
to the Latest
Year ended 31 December Practicable
2019 2020 2021 Date
Number of restaurants at the
beginning of the period . . . . . . . . 77 94 128 148
Newly opened restaurants . . . . . . . . 19 38 26 3
Closed restaurants . . . . . . . . . . . . . 2 4 6 1
Net increase . . . . . . . . . . . . . . . . . 17 34 20 2
Number of restaurants at the end of
the period . . . . . . . . . . . . . . . . . 94 128 148 150
The following map demonstrates the geographic location of our restaurants in Greater China
as of the Latest Practicable Date:
Number of
Location restaurants
Beijing 5
Shandong 3
Shaanxi 1
Jiangsu 52
Shanghai 38
Hubei 1
Zhejiang 34
Chongqing 4
Sichuan 2
Fujian 3
Guangdong 6
Taiwan 1
Total 150
Number of restaurants
More than 30 restaurants (including 30)
Between 5 to 29 restaurants (including 5)
Less than 5 restaurants
Note: The map is for illustration purposes only. Due to the size and layout of this page, the scale, proportion and details
of the map may not be sufficiently precise as that published by the PRC Government. If any difference exists,
please visit the official website of the Ministry of Natural Resources of the People’s Republic of China for your
reference (http://bzdt.ch.mnr.gov.cn/browse.html?picId=%224o28b0625501ad13015501ad2bfc0468%22).
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SUMMARY AND HIGHLIGHTS
Restaurant performance
The following table sets forth certain key operational information with respect to our Want
Hotpot restaurants during the Track Record Period:
Year ended 31 December
2019 2020 2021
Average spending per customer (Renminbi Yuan) (1) . . . 123.7 128.1 124.4
Total customers served (persons/day) (2) . . . . . . . . . . . 26,800 30,245 31,676
(3)
Table turnover rate (times/day) ............... 3.0 2.5 2.3
Average customers per day per restaurant (4) . . . . . . . . 285 236 211
(5)
Average daily restaurant sales (RMB’000) ........ 36.1 31.0 27.3
Notes:
(1) Calculated by dividing gross revenue generated from restaurant operations for the period by total customers served
for the period. Only dine-in services are accounted. Revenue generated from delivery service and takeout orders is
excluded. For more details on how we calculate total customers, see note (2).
(2) Accordingly, the amounts presented for our total customers served in the table above and elsewhere in the
Document are based on the number of customers recorded in our IT system, which represents our total dine-in
customers. Revenue generated from delivery service and takeout orders is excluded.
(3) Calculated by dividing the total dine-in orders served for the period by restaurant operation days, which are the
days we provide dine-in services for the period and average table count during the period. Revenue generated from
delivery service and takeout orders is excluded.
(4) Calculated by dividing the total customers served for the period by restaurant operation days, which are the days
we provide dine-in services for the period. Revenue generated from delivery service and takeout orders is excluded.
For more details on how we calculate total customers served, see note 2.
(5) Calculated by dividing the gross revenue from restaurant operations and delivery services for the period by the
actual operating days, which are the days we provide dine-in services and/or delivery services for the period.
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SUMMARY AND HIGHLIGHTS
The following table sets forth details of same-store sales of our Want Hotpot restaurants
during the Track Record Period:
Year ended 31 December
2019 2020 2020 2021
Number of same stores(1) . . . . . . . . . 70 88
Same-store sales (RMB’000) (2) . . . . . 975,907.1 830,484.8 1,002,102.3 918,514.1
(5) (5)
Same-store sales growth . . . . . . . . . (14.9)% (8.3)%
Average same-store sales per day
(RMB’000) (3) . . . . . . . . . . . . . . . . 38.4 33.7 32.5 29.0
Same-store table turnover rate
(time/day) (4) . . . . . . . . . . . . . . . . 3.2 2.6 2.6 2.4
Notes:
(1) Includes restaurants that commenced operations prior to the beginning of the periods under comparison and
opened for more than 300 days in years ended 31 December 2019, 2020 and 2021.
(2) Refers to the aggregate gross revenue from restaurant operations and delivery services at our same stores for the
period indicated.
(3) Calculated by dividing the gross revenue from restaurant operations and delivery services for the period by the
actual operating days, which are the days we provide dine-in services and/or delivery services, at our same stores
for the period.
(4) Calculated by dividing the total dine-in orders served for the period by the product of total restaurant operation
days, which are the days we provide dine-in services for the period and average table count at our same stores
during the period.
(5) Such decrease in same-store sales growth from 2019 to 2020 and from 2020 to 2021 is primarily due to the
decrease in our overall table turnover rate as a result of shortened operating hours and reduced traffic amid COVID-
19.
Other Operations
We commenced our food delivery business by cooperating with third parties in 2018. As of
the Latest Practicable Date, we operated food delivery business in most of our restaurants across
Greater China. According to the F&S Report, the food delivery sector in the PRC has expanded
rapidly from RMB231.3 billion to RMB715.4 billion from 2016 to 2020, and is expected to grow at
a CAGR of 15.1% from 2020 to 2025.
To further extend our brand and strengthen our brand image, we strategically launched our
retail business of ready-to-serve products in May 2020. During the Track Record Period, we
offered several ready-to-serve products. We launched the stewed chicken and pork tripe soup (撈
王胡椒豬肚雞湯) in 2020 to tailor to urban young people’s demand for fast, convenient and
healthy food. We started offering the XO sauce (撈王XO醬) and the stewed boneless chicken with
assorted pickles and rattan pepper (撈王青花椒酸菜湯底) in September 2021 as well as the
mutton stew with Chinese herbs (撈王慢燉羊肉煲) and the QQ Meatballs (撈王豬肉貢丸) in
November 2021. According to the F&S Report, the market size of ready-to-serve business in the
PRC increased significantly from RMB150.8 billion to RMB278.6 billion from 2016 to 2020, and is
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SUMMARY AND HIGHLIGHTS
expected to further increase at a CAGR of 18.8% from 2020 to 2025. Going forward, we expect to
strengthen our offline retail presence through strategic collaborations with boutique
supermarkets targeting white collar consumers and major convenience store chains, and will
also sell ready-to-serve products at our restaurants nationwide.
IMPACTS OF THE COVID-19 PANDEMIC
Coronavirus disease 2019, also known as COVID-19, is a contagious disease. COVID-19 was
declared a pandemic by the World Health Organization in March 2020. Hit by COVID-19, the
catering service industry, including us, has undergone such a dramatic shift, in particular during
the rapid escalation of infection control response.
To contain the spread of COVID-19, the PRC government implemented mandatory quarantine,
closure of work places and facilities, travel limitations and other relevant containment measures.
These containment measures, such as limitation on social and gathering activities, resulted in
limited hours of operation for restaurants and decreased customer traffic, enactment of travel
bans, blockage of certain roads, and closure of factories and companies, which negatively
affected the whole restaurant industry in China.
We have adopted a set of carefully-designed measures to prevent and control COVID-19,
including but not limited to the following: (i) we conduct temperature checks on our employees
before they resume work to ensure they do not have any potential health issue, such as fever;
(ii) we require all of our staff to wear facial mask while on-duty; (iii) we carried out measures to
maintain the healthiness of the employees who live in our employees’ dormitory; and (iv) we
measure the body temperature of the customers who come to our restaurants.
In May 2021, Taiwan government imposed stringent containment measures to suspend
operations of all non-essential business. We strictly followed governmental guidances for both
our dine-in and food delivery services and implemented the following measures: (i) we took
entrants’ temperatures upon arrival; (ii) we sanitized the restaurants three times per day; (iii) we
seperated seats and blocked certain seats to ensure social distancing measures; and (iv) we
required all of our employees and third-party delivery personnels to wear masks and to sanitize
themselves before contacting food.
COVID-19 pandemic has changed the landscape of the catering service market in China and
significantly decreased the number of restaurants and the concentration of businesses, but it
also promoted retail business and food delivery business. Since the catering service industry is
highly susceptible to contagious disease for that restaurant, may suffer from temporary closures
and decreased customer traffic, sales of our restaurant operations for a period after the outbreak
of COVID-19 in 2020 had decreased as a result. However, amid sweeping lockdowns and social
distancing measures nationwide, ordering food online seems to have become popular for those
who are working or learning at home, offering the chance to eat a wider variety of food, without
risking unnecessary human contact. In this regard, our revenue generated from food delivery
service increased from RMB27.0 million to RMB59.1 million from 2019 to 2020; while after our
commencement of retail business in 2020, revenue generated from this sector amounted to
RMB3.4 million for the year ended 31 December 2020.
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SUMMARY AND HIGHLIGHTS
At the epidemic peak of COVID-19 in mainland China from February to March 2020, 55 of our
restaurants suspended restaurant operations and food delivery services completely for at least
ten days, and 92 restaurants suspended dine-in services and provided only food delivery and
takeaway services for at least 20 days. For restaurants that remained open, their same-store
sales from February to March 2020 on average declined by 61% compared with that of
corresponding period in 2019 due to shortened operating hours and reduced traffic. However, our
supply was not materially impacted by COVID-19 pandemic. We resumed regular operations for all
of our affected restaurants before and as of 30 June 2020.
Widespread COVID-19 outbreaks in various regions of China throughout 2021 have caused
temporary suspension of operations in some of our restaurants and adversely impacted our
financial positions. For the year ended 31 December 2021, 81 of our restaurants in 14 cities
suffered from temporary suspension or reduced traffic as a result of COVID-19 containment
measures, leading to a 17.7% of the year-on-year revenue decline(1) of all affected restaurants in
the said 14 cities compared with 2020. Moreover, we believe unpredictable disruptions have
shaken consumer sentiment and hammered our financial positions indirectly. See ‘‘Financial
Information — Factors Affecting Our Results of Operations and Financial Condition and
Comparability — Impact of Contagious Disease’’ in this Document for more details.
OUR CUSTOMERS AND SUPPLIERS
Our Customers
Revenue derived from our five largest customers accounted for less than 5% of our total
revenue for each of the years ended 31 December 2019, 2020 and 2021. All of our five largest
customers in 2019, 2020 and 2021 are Independent Third Parties.
Our Suppliers
We had 98, 140 and 149 authorized suppliers as of 31 December 2019, 2020 and 2021,
respectively. As of the Latest Practicable Date, our business relationships with our five largest
suppliers for the Track Record Period ranged from one to six years. All of our five largest
suppliers during the Track Record Period are Independent Third Parties. None of our Directors,
their associates or any of our current Shareholders (who, to the knowledge of our Directors, own
more than 5% of our share capital as of the Latest Practicable Date) has any interest in any of
our five largest suppliers that is required to be disclosed under the Listing Rules. During the
Track Record Period and as of the Latest Practicable Date, none of our suppliers is our
customers.
Our largest supplier accounted for 14.6%, 18.2% and 14.2% of total purchase amount for
the years ended 31 December 2019, 2020 and 2021, respectively. Our five largest suppliers
accounted for 39.1%, 44.4% and 40.9% of total purchase amount for the years ended 31
December 2019, 2020 and 2021, respectively.
Note:
(1) We calculate the decline in year-on-year revenue by comparing the aggregated monthly revenue of these 81 affected
restaurants during the months when more than one case of local spread was identified in the cities where these
restaurants are located, for the years ended 31 December 2020 and 2021.
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SUMMARY AND HIGHLIGHTS
OUR EMPLOYEE
We established Laowang Academy (撈王培訓中心) in 2017 as our training institution to
provide systematic training to our employees. We conduct comprehensive online and offline
trainings for all our employees, including our headquarters office personnel, restaurant
management personnel and restaurant staff.
We genuinely care about our employees in every way. We provide our employees with
weekly bulletins and meetings for the members of a team to share their thoughts, learnings or
other ideas, passing our Love and concern on. As a result, our monthly employee turnover rate,
excluding employees left their jobs after less than a month, was 7.5%, 7.2% and 6.5% in 2019,
2020 and 2021, respectively, relatively lower than the industry average of around 15% according
to the F&S Report. As of the Latest Practicable Date, we had a total of 4,629 staff, including 2,115
employees and 2,514 outsourced personnel.
In order to incentivize our Directors, senior management and other employees for their
contribution to our Group and to retain suitable personnel in our Group, we adopted the
[REDACTED] Share Option Scheme on 28 July 2021 and the [REDACTED] Share Option Scheme on
30 November 2021. As of the Latest Practicable Date, options to subscribe for 8,152,800 Shares
were granted and remained outstanding under the [REDACTED] Share Option Scheme. For more
details, see ‘‘Appendix IV — Statutory and General Information — D. Other Information — 14.
Share Option Schemes.’’
RISK FACTORS
Our operation involves certain risks and uncertainties as set out in ‘‘Risk Factors’’ in this
Document. You should read that section in its entirety carefully before you decide to [REDACTED]
in the [REDACTED]. Some of the major risks we encounter include the following:
. We have in recent years experienced and are planning to continue a rapid restaurant
expansion, which may increase risks and uncertainties.
. Our business depends substantially on the market recognition of our brands.
. Dysfunction of food quality control systems could have a material adverse effect on
our reputation and profitability.
. Changes in consumer preferences and discretionary spending patterns could have a
negative effect on our business.
. Our operations are suspectible to changes in our supply; any shortages or
interruptions in food supply may slow down our growth and reduce our profitability.
. Difficulties in employee recruiting and retention in restaurant operations may slow our
expansion.
. Our business operations and financial performance have been and may be
continuously affected by COVID-19.
– 12 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
. Any outbreak of food-borne illnesses, epidemic or contagious diseases would
adversely affect our operations.
. We operate in a highly competitive and fast-changing market and may lose our market
share if we fail to compete successfully.
OUR CONTROLLING SHAREHOLDERS AND [REDACTED] INVESTORS
Immediately following the completion of the [REDACTED] (assuming that the [REDACTED] is
not exercised and without taking into account any Shares which may be issued upon the exercise
of the options granted under the [REDACTED] Share Option Scheme or any options which may be
granted under the Share Option Scheme), our founders, namely Mr. Lee, Mr. Chen and Mr. Chao,
and the spouse of Mr. Chen (Ms. Huang) and Mr. Chao (Ms. Wong), together as a concert group,
will be interested in more than 30% of the total issued share capital of our Company through
themselves and their respective wholly-owned investment holding companies, namely, LYC,
Eversun Holdings, CH&H, Lucky-CH, and ZHZ, and are together regarded as a group of Controlling
Shareholders of our Company. Mr. Lee, Mr. Chen, Ms. Huang, Mr. Chao and Ms. Wong, who
directly or indirectly held 29.92%, 7.51%, 1.33%, 4.26% and 2.00% of our total issued share
capital, respectively, as of the Latest Practicable Date, entered into the Concert Party Agreements
on 18 August 2021 to confirm and acknowledge their acting-in-concert relationship. See
‘‘Relationship with Controlling Shareholders’’ in this Document for more information.
Our [REDACTED] investors, Oasis Eagle International Co., Ltd, Blue Alliance International
Limited, Lin Sheng-chih (林勝枝), Tsai Yu-chia (蔡有佳), Cheng Siu-lun (鄭兆倫), Hou Yu-lin (侯佑
霖), Tsai Shan-tsao (蔡勝超), Tsai Chih-chen (蔡志誠), Cheng Pao-lien (鄭寶蓮), Myrialink Limited,
Wu Chen-hung (吳振弘), Lin Chun-hsien (林駿憲), Starry Chance Investments Limited, Chao Yu-
tung (趙育彤), and LWSPV, acquired Shares representing approximately [REDACTED], [REDACTED],
[REDACTED], [REDACTED], [REDACTED], [REDACTED], [REDACTED], [REDACTED], [REDACTED],
[REDACTED], [REDACTED], [REDACTED], [REDACTED], [REDACTED], [REDACTED] of our total issued
share capital after the [REDACTED] (assuming the [REDACTED] is not exercised), respectively, at
the consideration of RMB7,499,718.85, NT$9,765,107.10, US$550,111, US$550,108,
RMB5,700,000, NT$3,480,000, RMB4,950,171, RMB1,600,000, NT$3,480,000, RMB4,300,000,
US$233,441, RMB4,999,858.48, US$4,660,194.17, RMB4,999,858.48, and US$3,000,000,
respectively. Our [REDACTED] investors and its ultimate beneficial owners are Independent Third
Parties. See ‘‘History and Corporate Structure — [REDACTED] Investments’’ in this Document for
more information.
SUMMARY OF HISTORICAL FINANCIAL INFORMATION
The following tables set forth a summary of our consolidated financial information during
the Track Record Period, extracted from the Accountants’ Report set out in Appendix I to this
Document. The summary of consolidated financial data sets forth below should be read together
with, and is qualified in its entirety by reference to, the consolidated financial statements in this
Document, including the related notes. Our consolidated financial information has been prepared
in accordance with IFRS.
– 13 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
Summary Consolidated Statements of Profit or Loss
The following table sets forth the data from our consolidated statements of profit or loss for
the periods indicated.
Year ended 31 December
2019 2020 2021
RMB’000 RMB’000 RMB’000
Revenue (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,094,753 1,124,770 1,299,791
Raw materials and consumables used (2) . . . . . . . . . . (381,657) (415,447) (478,252)
Gross Profit (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 713,096 709,323 821,539
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,913 6,786 8,427
Staff costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (320,520) (317,757) (388,907)
Rental expenses and related expenses . . . . . . . . . . . (52,395) (52,116) (80,913)
Utilities expenses . . . . . . . . . . . . . . . . . . . . . . . . . . (37,735) (37,034) (45,854)
Depreciation and amortisation(4) . . . . . . . . . . . . . . . . (137,155) (157,608) (186,452)
[REDACTED] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (14,427)
Other operating expenses . . . . . . . . . . . . . . . . . . . . (41,363) (44,394) (55,312)
Other gains and losses . . . . . . . . . . . . . . . . . . . . . . (953) (130) (2,971)
Impairment losses recognized in respect of property
and equipment . . . . . . . . . . . . . . . . . . . . . . . . .. — — (10,259)
Materials consumed for research activities . . . . . . . .. (266) (204) (179)
Finance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . .. (12,977) (15,735) (18,532)
Profit before tax . . . . . . . . . . . . . . . . . . . . . . . . . . . 121,645 91,131 26,160
Income tax expenses . . . . . . . . . . . . . . . . . . . . . . . . (41,730) (23,690) (12,200)
Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . 79,915 67,441 13,960
Items that may be reclassified subsequently
to profit or loss:
Profit for the year attributable to:
Owners of the Company . . . . . . . . . . . . . . . . . . 77,949 66,036 13,129
Non-controlling interests . . . . . . . . . . . . . . . . . . 1,966 1,405 831
79,915 67,441 13,960
Notes:
(1) Our revenue increased increased slightly by 2.7% from RMB1,094.8 million for the year ended 31 December 2019 to
RMB1,124.8 million for the year ended 31 December 2020 primarily due to an increase in the revenue from food
delivery business and retail business, which was slightly offset by the decrease in revenue from restaurant
operations as a result of COVID-19. Our revenue increased by 15.6% from RMB1,124.8 million for the year ended 31
December 2020 to RMB1,299.8 million for the year ended 31 December 2021 primarily due to an increase in the
revenue from restaurant operations and retail business, which was slightly offset by the decrease in revenue from
food delivery business.
(2) Raw material and consumable used during the Track Record Period was generally in line with the business
expansion and revenue increase. As such, our gross profit margin remained relatively stable at approximately 64%.
(3) We define gross profit as revenue deducting raw materials and consumables used.
– 14 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
(4) Our depreciation and amortization increased from RMB137.2 million for the year ended 31 December 2019 to
RMB157.6 million for the year ended 31 December 2020, and further increased to RMB186.5 million for the year
ended 31 December 2021, primarily due to an increase in leases for our restaurant premises as a result of business
expansion. See ‘‘Financial Information — Period to period comparison of results of operations’’ in this Document for
more details.
Non-IFRS measures
The Adjusted Net Profit, which is unaudited in nature, represents our net profit excluding
[REDACTED] and share-based payments expenses which were incurred outside of the usual and
ordinary course of business. The Adjusted Net Profit is not a measure of performance under IFRS.
As a non-IFRS measure, the Adjusted Net Profit is presented because our management believes
such information will be helpful for investors in assessing the level of our net profit by
eliminating the effects of certain non-cash or non-recurring items unrelated to our usual and
ordinary course of business. We have added back (i) [REDACTED] mainly because it is non-
recurring in nature, and (ii) share-based payments expenses mainly because it is non-cash
expenses, which does not directly correlate with the underlying performance of our business
operations.
The use of the Adjusted Net Profit has material limitations as an analytical tool, as it does
not include all items that impact our profit for the relevant year. The following table sets forth a
table that reconciles our Adjusted Net Profit for the year presented to the most directly
comparable financial measure calculated and presented in accordance with IFRS, which is profit
for the year:
Year ended 31 December
2019 2020 2021
RMB’000 % RMB’000 % RMB’000 %
Revenue . . . . . . . . . . . . . . . . . . . 1,094,753 100.0 1,124,770 100.0 1,299,791 100.0
Profit for the year . . . . . . . . . . . . 79,915 7.3 67,441 6.0 13,960 1.1
Add:
— [REDACTED] . . . . . . . . . . . . . — 0.0 — 0.0 14,427 1.1
— Share-based payment 3,880 0.4 3,184 0.3 1,250 0.1
expenses . . . . . . . . . . . . . .
Adjusted Net Profit . . . . . . . . . . . . 83,795 7.7 70,625 6.3 29,637 2.3
– 15 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
Selected Consolidated Statements of Financial Position
The following table sets forth selected data from our consolidated statements of financial
position as of the dates indicated.
As of 31 December
2019 2020 2021
RMB’000 RMB’000 RMB’000
Non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . 469,175 593,150 650,658
Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206,527 265,237 326,968
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,068 35,005 52,147
Trade and other receivables . . . . . . . . . . . . . . . . . 21,297 29,395 40,774
Value-added tax recoverable . . . . . . . . . . . . . . . . . 20,677 48,353 73,609
Prepayments to suppliers . . . . . . . . . . . . . . . . . . . 18,901 14,857 21,050
Term deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000 3,000 —
Bank balances and cash . . . . . . . . . . . . . . . . . . . . 112,584 134,627 139,388
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 228,121 298,800 379,840
Trade and other payables . . . . . . . . . . . . . . . . . . . 136,317 192,128 231,568
Contract liabilities . . . . . . . . . . . . . . . . . . . . . . . . 2,115 2,512 3,880
Bank borrowings . . . . . . . . . . . . . . . . . . . . . . . . . — — 39,970
Dividend payables . . . . . . . . . . . . . . . . . . . . . . . . 130 305 305
Income tax payables . . . . . . . . . . . . . . . . . . . . . . 9,477 9,216 2,072
Lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 80,082 94,639 102,045
(1) (1)
Net current liabilities . . . . . . . . . . . . . . . . . . . . . . . . (21,594) (33,563) (52,872) (1)
Total assets less current liabilities . . . . . . . . . . . . . . 447,581 559,587 597,786
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225,237 284,798 300,469
Non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . 222,344 274,789 297,317
Note:
(1) We incurred net current liabilities as of 31 December 2019, 2020 and 2021 primarily because we recorded lease
liabilities due to the adoption of IFRS 16, which were greater than the aggregation of our current assets, primarily
consisting of value-added tax recoverable, bank balances and cash, trade and other receivables, prepayments to
suppliers and inventories, as of the same date.
– 16 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
Selected Consolidated Statements of Cash Flows
The following table sets forth selected data from our consolidated statements of cash flows
for the periods indicated.
Year ended 31 December
2019 2020 2021
RMB’000 RMB’000 RMB’000
Operating cash flows before movements
in working capital . . . . . . . . . . . . . . . . . . . . . . . . 275,614 262,271 243,804
Interest received . . . . . . . . . . . . . . . . . . . . . . . . . . . 231 363 628
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . (39,125) (27,341) (22,775)
Net cash from operating activities . . . . . . . . . . . . . . . 224,165 244,106 209,305
Net cash used in investing activities . . . . . . . . . . . . . (46,515) (111,510) (110,890)
Net cash used in financing activities . . . . . . . . . . . . . (138,717) (109,922) (94,932)
Net increase in cash and cash equivalents . . . . . . . . . 38,933 22,674 3,483
Cash and cash equivalents at beginning of the year . . 76,952 115,584 137,627
Cash and cash equivalents at end of the year . . . . . . 115,584 137,627 139,388
Other Financial Information
The following table sets forth our key financial ratios as of the dates or for the periods
indicated.
As of/For the year ended 31 December
2019 2020 2021
Gross profit margin . . . . . . . . . . . . . . . . . . . . . . . . . 65.1% 63.1% 63.2%
Return on assets(1) . . . . . . . . . . . . . . . . . . . . . . . . . 15.5% 8.8% 1.5%
Return on equity(2) . . . . . . . . . . . . . . . . . . . . . . . . . 40.5% 26.4% 4.8%
Current ratio (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.91 0.89 0.86
Quick ratio(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.77 0.77 0.72
Interest coverage(5) . . . . . . . . . . . . . . . . . . . . . . . . . — 110.14 41.00
Notes:
(1) Return on assets is calculated using net profit divided by the average of the beginning and ending balance of total
assets for that period, multiplied by 100%.
(2) Return on equity is calculated using net profit divided by the average of the beginning and ending balance of total
equity for the period, multiplied by 100%.
(3) Current ratio is calculated using total current assets divided by total current liabilities.
(4) Quick ratio is calculated using total current assets less inventories divided by total current liabilities.
(5) Interest coverage is calculated by earnings before interest and tax divided by interest on bank borrowings for each
period.
– 17 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
Changes in key financial ratios
Our return on assets decreased from 15.5% in 2019 to 8.8% in 2020, and further decreased
to 1.5% in 2021, mainly because of the decrease in net profit as a result of COVID-19. Our return
on equity decreased from 40.5% in 2019 to 26.4% in 2020, and further decreased to 4.8% in
2021, mainly because of the decrease in net profit as a result of COVID-19. Our current ratio
slightly decreased from 0.91 as of 31 December 2019 to 0.89 as of 31 December 2020, and
slightly decreased to 0.86 as of 31 December 2021. Our quick ratio remained relatively stable at
0.77 as of 31 December 2019 and 2020, then slightly decreased to 0.72 as of 31 December 2021.
See ‘‘Financial Information — Key financial ratios’’ in this Document for more details.
NON-COMPLIANCE AND LEGAL PROCEEDINGS
During the Track Record Period, we had certain non-compliance incidents with respect to (i)
fire safety and (ii) social insurance and housing provident funds. See ‘‘Business — Licenses,
Regulatory Approvals and Compliance’’ in this Document for more details. Our Directors, as
advised by our PRC Legal Advisors, confirm that except the non-compliance incidents disclosed
above, we had complied with the applicable PRC laws and regulations in all material respects
and had obtained all material requisite licenses, approvals and permits as required by applicable
laws and regulations from competent authorities in China during the Track Record Period and up
to the Latest Practicable Date. As of the Latest Practicable Date, we were not involved in any
material litigation, arbitration or administrative proceedings pending, to the best of our
knowledge, information and belief, threatened against us or any of our Directors that could have
a material adverse effect on our business, reputation, financial condition or results of
operations.
DIVIDENDS
We are a holding company incorporated under the laws of the Cayman Islands. As a result,
the payment and amount of any future dividend will depend on the availability of dividends
received from our PRC subsidiaries. PRC laws and regulations require that dividends to be paid
only from net profits which is different from the generally accepted accounting principles in other
jurisdictions, including IFRS. PRC laws also require foreign invested enterprises to set aside at
least 10% of their after-tax profit for the year as statutory reserves which are not allowed to
distribute as cash dividends. The distribution of dividends from us or our subsidiaries may also
be subject to any restrictive covenants in bank credit facilities, convertible bond instruments or
other agreements that we or our subsidiaries may enter into in the future.
For the years ended 31 December 2019, 2020 and 2021, we declared dividends of RMB26.5
million, RMB11.1 million and RMB0, respectively. Dividends declared in the past are not
indicative of our future dividend policy. All the dividends declared have been/will be settled
before [REDACTED]. The amount of dividends actually distributed to our Shareholders will depend
on our earnings and financial conditions, operating requirements, capital requirements and any
other conditions that our Directors may deem relevant and will be subject to approval of our
Shareholders. Our Board has the absolute discretion to recommend any dividend. We do not
have any pre-determined dividend payout ratio.
– 18 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
[REDACTED] STATISTICS
The statistics in the following table are based on the assumptions that the [REDACTED] is
completed, [REDACTED] shares are issued in the [REDACTED] and the [REDACTED] and the options
granted under the [REDACTED] Share Option Scheme are not exercised.
[REDACTED] [REDACTED]
[REDACTED] (1) . . . . . . . . . . . . . . . . . . . . . . . . [REDACTED] [REDACTED]
[REDACTED] (2) . . . . . . . . . . . . . . . . . . . . . . . . [REDACTED] [REDACTED]
(1) [REDACTED]
(2) [REDACTED]
[REDACTED]
Our [REDACTED] mainly include [REDACTED] fees and commissions and professional fees
paid to legal, accounting and other advisors for their services rendered in connection to the
[REDACTED] and the [REDACTED]. Our aggregate [REDACTED] incurred and to be incurred amount
to RMB[REDACTED] million (including [REDACTED] commission) assuming the [REDACTED] is not
exercised and the [REDACTED] of HK$[REDACTED] per share, being the [REDACTED] of the
indicative [REDACTED] range. RMB[REDACTED] million of the [REDACTED] are [REDACTED]-related
expenses and RMB[REDACTED] million of the [REDACTED] are non-[REDACTED]-related expenses,
which includes (i) RMB[REDACTED] million of fees and expenses paid to legal advisors and
accountants, and (ii) RMB[REDACTED] million of other fees and expenses. For the year ended 31
December 2021, we incurred [REDACTED] of RMB[REDACTED] million. After 31 December 2021 and
up to [REDACTED], approximately RMB[REDACTED] million (equivalent to HK$[REDACTED] million)
of [REDACTED] is accounted for as a deduction from equity upon the [REDACTED] and
approximately RMB[REDACTED] million (equivalent to HK$[REDACTED] million) is expected to be
charged to our consolidated statements of profit and loss. The [REDACTED] above are the latest
practicable estimate for reference only, and the actual amount may differ from this estimate.
Although [REDACTED] have materially impacted our results of operations for the year ended 31
December 2021, our Directors do not expect such [REDACTED] to have a material and adverse
impact on our results of operations for the year ending 31 December 2022.
USE OF [REDACTED]
We estimate that we will receive [REDACTED] of approximately HK$[REDACTED] million from
the [REDACTED] after deducting the [REDACTED] commissions and other estimated [REDACTED]
expenses payable by us and assuming the [REDACTED] of HK$[REDACTED] per Share, being the
– 19 –THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE
READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT.
SUMMARY AND HIGHLIGHTS
[REDACTED] of the indicative [REDACTED] range set forth on the cover page of this Document. We
intend to use the [REDACTED] from the [REDACTED] for the purposes and in the amounts set forth
below:
. Approximately [REDACTED], or HK$[REDACTED] million of the [REDACTED], will be used
to finance the construction of our Laowang Gourmet Lab 2, expected to be completed
by the third quarter of 2023.
. Approximately [REDACTED], or HK$[REDACTED] million of the [REDACTED], will be used
to open new restaurants nationwide and globally, and details of which are summarized
in ‘‘Business — Our Restaurants — Our Flagship — Want Hotpot (撈王鍋物料理) —
Expansion plan of Want Hotpot’’ and ‘‘Business — Our Restaurants — Other
Restaurants’’ in this Document.
. Approximately [REDACTED], or HK$[REDACTED] million of the [REDACTED], will be used
for our working capital and general corporate purposes.
See ‘‘Future Plans and Use of [REDACTED]’’ in this Document for more details.
RECENT DEVELOPMENTS
Subsequent to the Track Record Period and up to the Latest Practicable Date, we continued
to focus on our multi-brand strategy. Based on our preliminary review of the Group’s operating
data during the period, we made the following observations:
Revenue — Our unaudited revenue for the month ended 31 January 2022 was higher than
the month ended 31 January 2021, primarily due to an increase in the number of our restaurants.
We have also continued to expand our restaurant network, for movements of our restaurants up
to the Latest Practicable Date, see ‘‘Business — Our Restaurant Operations — Restaurant
Network’’ in this Document for more details.
Gross profit margin — Our cost of raw materials and consumables used as a percentage of
our revenue remained relatively stable, and hence our gross profit margin remained relatively
stable.
Retail business — We started offering other ready-to-serve products, the XO sauce and the
stewed boneless chicken with assorted pickles and rattan pepper in September 2021 as well as
the mutton stew with Chinese herbs and the QQ Meatballs in November 2021. As of the Latest
Practicable Date, our ready-to-serve products were sold in more than 100 stores.
Impact of COVID-19 — Several provinces across China has suffered from a regional resurgence
of COVID-19 outbreaks from 1 January 2022 up to the Latest Practicable Date. As a result, several
provinces have implemented stringent COVID-19 containment measures or travel restrictions, which
may continuously impact our business operations and financial performance.
NO MATERIAL ADVERSE CHANGE
After due and careful consideration, our Directors confirm that, up to the date of the
Document, there has been no material adverse change in the financial or trading position or
prospects of us since 31 December 2021, being the latest date of our audited consolidated
financial statements as set out in ‘‘Appendix I — Accountants’ Report’’ to this Document.
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