Total revenue of the Group was approximately HK$45.8 million for the year ended 31 December 2022 (2021: HK$55.8 million). Gross profit increased by approximately 35.5% year-on-year to approximately HK$22.5 million in 2022. Overall gross profit margin of the Group increased by approximately 19.5 percentage points, from approximately 29.7% in 2021, to approximately 49.2% in 2022, which was primarily attributable to the increase in the gross profit margin of the air ticket distribution segment.
Loss decreased by approximately 81.8% to approximately HK$13.8 million for the year ended 31 December 2022 (Loss for the year in 2021: HK$75.8 million), primarily due to the increase in gross profit of the Group; the turnaround in expected credit losses ("ECLs") allowance on financial assets of HK$43.3 million from the approximately HK$39.3 million provision of ECLs allowance made in 2021, hence reversing ECLs allowance by approximately HK$4.0 million in 2022; and a one-off net provision of Departure and Deemed Disposition Taxes of approximately HK31.4 million in 2021 as income tax expenses.
Ms. Mariana Kou, Chairperson and Executive Director of Cinese International, said, "The Group's performance in 2022 continued to be impacted by the prevailing COVID-19 pandemic, but to a lesser extent as compared to 2021. We saw continuous recovery in the travel industries with vaccination rates climbing and travel restrictions relaxing worldwide. At that, the Group recorded an increase in transaction volume and revenue of its air ticket distribution services and travel business process management services in 2022 against 2021. We have continued to explore new business opportunities to widen our income streams for sustainable development."
During the year, the Group drew on its knowledge and experience from being a travel services provider to explore new business opportunities. It signed a non-legally binding memorandum of understanding in early 2022 with a travel services provider in the Greater Bay Area in relation to potential travel business cooperation. The Group commenced its cooperation with the said travel services provider in September 2022 to avail travel-related services in the Greater Bay Area and further developed its business operations in the Greater Bay Area since 2023 following the ease of the CoVID-19 pandemic. Accordingly, the Group expects to generate revenue for the travel products and services segment in 2023.
The air ticket distribution business segment experienced a remarkable recovery in 2022, despite the continued impact of the COVID-19 pandemic. Segmental revenue increased by approximately 54.1% year-on-year to approximately HK$11.4 million in 2022. Such increase was mainly attributable to the increase in transaction volume of air tickets sales and gross sales proceeds generated from air tickets sales, thanks to the continuous recovery of the travel industries with vaccination rates rising and travel restrictions relaxing worldwide. As at 31 December 2022, the Group had ticketing authority for more than 150 airlines and private fare deals with around 70 airlines, including top airlines based in Canada, the United States and China.
The travel business process management segment covers air ticket transaction processing, customer contact, BSP/ARC settlement and reconciliation, software development, and travel licensing and compliance, plus other administrative matters for customers. Segmental revenue generated from travel business process management rose by approximately 23.1% year-on-year to approximately HK$32.0 million in 2022. Such increase was mainly attributable to increase in transaction volume as travel industries continuously recovered amid the COVID-19 pandemic coming under better control. The Group will continue to expand its customer base by initiating sales efforts targeting travel agents that share similar profile and market positioning as its existing customers.
Prospects
Air travel demand is off to a very healthy start in 2023, which bodes well for the continued and steady industry recovery from the COVID-19 pandemic. It is expected that the airline, travel and tourism industries worldwide would be gradually recovered with steady demand for travel and increasing flight number. In addition to more countries relaxing or even cancelling their quarantine restrictions, airlines of different countries are increasing their number of destinations and passenger demand and bookings are also on the rise. In particular, the Group has resumed providing package tours in the first quarter of 2023. The Group therefore believes that the travel industries as a whole, are improving, which will in turn create business opportunities for the Group.
Ms. Kou concluded, "We will continue to establish the Group's presence in the travel industries of the Greater Bay Area with our newly entered travel business corporate arrangement mentioned above. We will continue to deploy business strategies with a view to sustain the Group's travel related businesses and endeavor to explore suitable business opportunities from time to time in the travel consultancy, healthcare, hospitality and other potential service industry by leveraging our knowledge and experience, so as to create business synergy, enhance earning capability and potential, and bring value to shareholders."
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