The Sincere Company, Limited provided earning guidance for six months ended 30 June 2023. The board of directors of the Company informed the shareholders of the Company (the "Shareholders") and potential investors that based on the Group's unaudited consolidated management accounts for the six months ended 30 June 2023 (the "Management Accounts"), the Group is expected to record net loss attributable to the Shareholders ranging from HKD 15.0 million to HKD 20.0 million for the six months ended 30 June 2023 ("1H2023") as compared to the net loss attributable to the Shareholders for the six months ended 30 June 2022 ("1H2022") of approximately HKD 38.1 million.
The reduction in loss was mainly attributable to (i) increase in revenue of the department store operations of the Group in 1H2023 by approximately HKD 5.5 million resulting from the gradual recovery of economic activities in Hong Kong and the reopening of border with mainland China in 1H2023; (ii) improvement in gross profit margin from approximately 55% to approximately 59%; and (iii) decrease in depreciation of right-of-use assets of approximately HKD 11.0 million as one of stores closed in late 2022 and due to the rent concession obtained for the department store operation.