StarGlory : ANNUAL REPORT 2021-2022

CHARACTERISTICS OF GEM OF THE STOCK EXCHANGE OF HONG KONG LIMITED (THE "STOCK EXCHANGE")

GEM has been positioned as a market designed to accommodate small and mid-sized companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration.

Given that the companies listed on GEM are generally small and mid-sized companies, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board and no assurance is given that there will be a liquid market in the securities traded on GEM.

Hong Kong Exchanges and Clearing Limited and the Stock Exchange take no responsibility for the contents of this report, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this report.

This report, for which the directors (the "Directors") of StarGlory Holdings Company Limited (the "Company") collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on GEM of the Stock Exchange (the "GEM Listing Rules") for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this report is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this report misleading.

StarGlory Holdings Company Limited Annual Report 2021-2022 1

Contents

	PAGE
Corporate Information	3
Chairman's Statement	4
Corporate Governance Report	7
Environmental, Social and Governance Report	21
Management Discussion and Analysis	40
Directors and Senior Management	53
Directors' Report	57
Independent Auditor's Report	66
Consolidated Statement of Profit or Loss	72
Consolidated Statement of Comprehensive Income	73
Consolidated Statement of Financial Position	74
Consolidated Statement of Changes in Equity	76
Consolidated Statement of Cash Flows	77
Notes to the Consolidated Financial Statements	79
Financial Summary	149

2 StarGlory Holdings Company Limited Annual Report 2021-2022

EXECUTIVE DIRECTORS

Mr. Huang Chao (Chairman)

Mr. Wu Xiaowen

INDEPENDENT NON-EXECUTIVE DIRECTORS

Mr. Chan Yee Ping Michael

Mr. Zeng Shiquan

Mr. Yang Haiyu

COMPANY SECRETARY

Ms. Lam Kit Yan FCPA

COMPLIANCE OFFICER

Mr. Huang Chao

AUDIT COMMITTEE

Mr. Chan Yee Ping Michael (Chairman)

Mr. Zeng Shiquan

Mr. Yang Haiyu

REMUNERATION COMMITTEE

Mr. Yang Haiyu (Chairman)

Mr. Huang Chao

Mr. Chan Yee Ping Michael

NOMINATION COMMITTEE

Mr. Huang Chao (Chairman)

Mr. Chan Yee Ping Michael

Mr. Zeng Shiquan

CORPORATE GOVERNANCE COMMITTEE

Mr. Chan Yee Ping Michael (Chairman)

Mr. Huang Chao

Mr. Zeng Shiquan

AUTHORIZED REPRESENTATIVES

Mr. Huang Chao

Ms. Lam Kit Yan FCPA

PRINCIPAL BANKER

The Bank of East Asia Limited

Corporate Information

AUDITOR

PKF Hong Kong Limited

Certified Public Accountants

26th Floor, Citicorp Centre

18 Whitfield Road

Causeway Bay, Hong Kong

PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE

Suntera (Cayman) Limited

Suite 3204, Unit 2A,

Block 3, Building D, P.O. Box 1586,

Gardenia Court, Camana Bay

Grand Cayman, KY1-1100, Cayman Islands

HONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICE

Computershare Hong Kong Investor Services Limited

Shops 1712-1716, 17th Floor, Hopewell Centre

183 Queen's Road East, Wanchai

Hong Kong

REGISTERED OFFICE

PO Box 309

Ugland House

Grand Cayman KY1-1104

Cayman Islands

HEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS IN HONG KONG

6th Floor Southland Building

48 Connaught Road Central Central

Hong Kong

COMPANY'S WEBSITE ADDRESS

www.stargloryhcl.com

GEM STOCK CODE

8213

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Chairman's Statement

Dear shareholders,

On behalf of the board of directors (the "Board") of StarGlory Holdings Company Limited (the "Company"), I am pleased to present the audited annual results of the Company and its subsidiaries (collectively referred to as the "Group" or "StarGlory") for the year ended 31 March 2022 (the "Reporting Period").

The global economy remained affected by the Novel Coronavirus ("COVID-19" or "the pandemic") over the last financial year, despite the fact that increased vaccination rates and government fiscal stimulus boosted economic activities globally. Highly transmissible COVID-19 variants such as Omicron swept the world, especially toward the end of 2021, creating a major barrier to a full economic recovery and a rebound in consumer sentiment. Meanwhile, a "new normal" mode of living has emerged, characterized by working from home, an upsurge in e-commerce activities, and increased use of online food-ordering platforms.

The mass-market food and beverage sector in Hong Kong and mainland China was negatively impacted by a resurgence of the pandemic during the Reporting Period. In Hong Kong, the industry began to regain momentum as the local pandemic situation stabilized following the first quarter of the Reporting Period amid timely stimulus measures delivered by the government. Business sentiment in the food and beverage sector improved and employers' conduciveness to hiring also showed signs of recovery. During the fourth quarter of 2021, when Hong Kong was hit by the fifth wave of the pandemic, the food and beverage industry was upended by more restrictive social distancing measures, shorter operating hours, and temporary restaurant closures. These abrupt shifts in the operating environment left many restaurant operators scrambling to serve customers effectively using online channels.

The Group is committed to offering customers a diverse range of cuisines and dedicated dining experiences, and continued to optimize its multi-brand network in mainland China and Hong Kong, including Italian Tomato and Ginza Bairin ("銀座梅林") during the Reporting Period. To accelerate our business development and enhance our competitive edge, we strategically adjusted our operations in Hong Kong with launches of new promotions and offers, and collaborated with various third-partyfood-ordering platforms and other business partners to drive additional local spending amid the introduction of the government's Consumption Voucher Scheme. In addition to offering our customers comforting, safe and pleasant dining experiences, we also captured growing demand from them for takeaway and online food ordering by expanding our takeaway and food delivery services, with the aim of fostering our online-to-offline business while capturing increased market share and protecting profitability during challenging times.

Italian Tomato, the Group's main restaurant, café and cake shop brand, achieved a satisfactory performance, thanks to the Group's swift response to changes in the market environment. During the Reporting Period, the Group adhered to pragmatic strategies, designing and rolling out seasonal and festive products with special offers, and redoubling its marketing, promotion and events efforts. Thanks to these efforts, we are proud that Italian Tomato has become one of the best recognized cake shop brands in Hong Kong, enabling the Group to build business resilience as the brand remains the key contributor to its revenue. In light of these promising results and significant market potential, the Group will seek fresh opportunities to strategically expand its cake shop business.

4 StarGlory Holdings Company Limited Annual Report 2021-2022