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FUTURE PLANS
See the section headed “Business – Our Growth Strategies” for a detailed description of our
future plans.
[REDACTED]
The table below sets forth the estimated [REDACTED]ofthe[REDACTED] which we will
receive after deduction of [REDACTED] fees and [REDACTED] and estimated expenses
payable by us in connection with the [REDACTED] (assuming the [REDACTED]isnot
exercised):
Assuming an [REDACTED] of HK$[REDACTED]
per [REDACTED] (being the mid-point of the
[REDACTED] range stated in this document)
HK$[REDACTED] million
Assuming an [REDACTED] of HK$[REDACTED]
per [REDACTED] (being the high end of the
[REDACTED] range stated in this document)
HK$[REDACTED] million
Assuming an [REDACTED] of HK$[REDACTED]
per [REDACTED] (being the low end of the
[REDACTED] range stated in this document)
HK$[REDACTED] million
We intend to use the [REDACTED] we will receive from this [REDACTED] for the following
purposes:
• Approximately [REDACTED]%, or HK$[REDACTED] million will be used for
opening new bars and realizing our expansion plan over the next three years. The bar
industry in China is a large and fast-growing market, with a total of 35,000 bars
nationwide in 2020 and an estimated 47,900 bars nationwide by 2023, according to
Frost & Sullivan. Benefiting from the increase in disposable income of Chinese
residents and in the number of bars in China, total revenue of the bar industry in
China increased from approximately RMB84.4 billion in 2015 to approximately
RMB117.9 billion in 2019, representing a CAGR of 8.7%. It is expected that such
growth trend will remain robust in the near future. Revenue of the bar industry in
China is expected to reach RMB183.9 billion in 2025, representing a CAGR of
18.8% as compared to approximately RMB77.6 billion in 2020. In view of the huge
market potential, we believed that continuously expanding the business scale to
boost the long-term growth through our established brand awareness would be in our
best interests. We expect to open 400, 630 and 900 bars in 2021, 2022 and 2023,
respectively, and increase the total number of bars to approximately 2,200 by the end
of 2023 assuming the capital expenditure incurred by opening each Helen’s bar
amounted to RMB0.9 million. Our Directors’ are of the view, and the industry
consultant, Frost & Sullivan concurs, that there is significant potential for us to
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further expand our business and market share, and we are able to become a
long-lasting popular bar brand under the brand name of “Helen’s” with our measures
to maintain and enhance its brand awareness. For details of the expansion plan for
our bars, see “Business — Our Growth Strategies — Continue to expand our bar
network.”
The following table sets forth the implementation status of our expansion plan as of
the dates indicated on a cumulative basis, respectively.
Location
Number of newly opened
self-operated bars as of
April 30,
2021
May 31,
2021
June 30,
2021
First-tier cities 41112
Second-tier cities 34 53 74
Third-tier or lower-tier cities 20 34 49
Total 58 98 135
To ensure the newly opened bars are appropriately distant from the existing ones, we
monitor the key performance indicators of the existing Helen’s bars before
launching new ones. We carefully examine the key operating data relating to the
existing bars, including but not limited to customer traffic and potential market
demand, to determine whether new bars can be launched around existing bars
without the competition between new bars and existing ones. For details, see also
“Business – Helen’s Bars – Bar Location and Planning.” For these newly opened
bars, we typically enter into lease contracts for a term from five to eight years. We
pay to the lessor and bear the necessary expenses such as property charges and
utilities within the lease term.
In 2018, 2019 and 2020, the average investment expenditure cost relating to the
opening of new Helen’s bars amounted to RMB0.6 million, RMB0.7 million and
RMB0.9 million, respectively, the growth of which is primarily driven by the
increase in the floor areas of the newly open bars. Going forward, we estimate the
investment expenditure cost relating to the opening of new Helen’s bars to be
approximately RMB0.9 million, which in consistent with the historical level.
We expect to open approximately 10% of our new Helen’s bars in first tier cities,
which is consistent with the geographical presence of our bars during the Track
Record Period. The following table sets forth our expansion plan in terms of
geographical locations and timeline for each of the periods indicated on a
non-cumulative basis, respectively.
FUTURE PLANS AND [REDACTED]
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Geographical Location For the year ended December 31,
2021 2022 2023
Jiangsu Province 26 56 81
Zhejiang Province 15 37 61
Shanghai 11 14 19
Hubei Province 40 36 50
Hunan Province 35 20 26
Jiangxi Province 5 7 11
He’nan Province 18 23 34
An’hui Province 12 24 36
Fujian Province 35 17 23
Guangdong Province 45 86 120
Hainan Province 4 7 5
Guangxi Province 9 23 32
Beijing 3 12 17
Tianjin 11 12 18
Shandong Province 10 44 71
Hebei Province 11 22 31
Liaoning Province 29 31 45
Jilin Province 14 14 21
Heilongjiang Province 10 27 23
Sichuan Province 11 32 48
Chongqing 10 13 19
Yunnan Province 8 13 18
Guizhou Province 10 8 12
Shanxi Province 6 13 23
Inner Mongolia 0 8 8
Gansu Province 0 13 18
Shaanxi Province 12 18 30
Total 400 630 900
Timeline For the year ended December 31,
2021 2022 2023
First Quarter 38 130 180
Second Quarter 110 160 240
Third Quarter 126 170 240
Fourth Quarter 126 170 240
Total 400 630 900
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In connection with the expansion plan of our bar network:
(i) approximately [REDACTED]%, or HK$[REDACTED] will be used for
opening more bars in the regions under our deployment over the next three
years. Our existing bars are mainly concentrated in the regions of China’s first-
and second-tier cities where there are higher concentrations of young
customers. Furthermore, in the future, we plan to open more bars in the regions
under our deployment to fully explore the development potential of those
regions.
(ii) approximately [REDACTED]%, or HK$[REDACTED] million will be used
for expanding the bar network to the new regions over the next three years. We
plan to further develop the lower-tier markets and continue to open more bars
in China’s third-tier and below cities. We will fully seize the broad market
prospects in these regions and continue to meet the increasing demand in the
lower-tier markets.
• approximately [REDACTED]%, or HK$[REDACTED] million will be used for
further enhancing the construction of the talent echelon of our bars to optimize the
human resource management system. Specifically, to support the expansion of our
bar chain network we will attract and retain more employees who agree with our
values as well as recruiting talents with expertise and experience in the fields of
supply chain management, brand communication, and technology research and
development. In the next three years, we plan to recruit 151 experts with expertise
in the fields of supply chain management, brand communication, and technology
research and development. For details of the construction of talent echelon, see
“Business – Our Development Strategies – Our Growth Strategies – Continuous
investments in our underpinning capacities.”
The following table sets forth the detailed plan of our talent recruitment in the next
three years to support our expansion plan.
For the year ended December 31,
2021 2022 2023
Field of
Expertise
Expected
number
of new
hires
Expected
average
compensation
per person
Expected
number
of new
hires
Expected
average
compensation
per person
Expected
number
of new
hires
Expected
average
compensation
per person
(RMB’000) (RMB’000) (RMB’000)
Supply chain
management 13 130 20 150 14 170
Brand
communication 8 130 40 150 15 170
Technology
research and
development 12 160 19 180 10 200
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The following table sets forth the number of employees in the above fields of expertise
and their average compensation per person in 2018, 2019 and 2020.
For the year ended December 31,
2018 2019 2020
Field of Expertise
Number of
Employees
Average
compensation
per person
Number of
Employees
Average
compensation
per person
Number of
Employees
Average
compensation
per person
(RMB’000) (RMB’000) (RMB’000)
Supply chain
management 3 100 8 91 13 116
Technology research
and development 7 86 11 103 14 140
Brand
Communication 9 123 16 98 22 114
For details of our recruiting policies and historical recruiting records, see the section
headed “Business – Our Employee” to this document.
• approximately [REDACTED]%, or HK$[REDACTED] will be used for further
enhancing the construction of infrastructural capacity of our bars. We plan to
continue to invest in research and development of technology. During the Track
Record Period, we utilized a proprietary business intelligence management system
(Future BI), a proprietary smart music management system and customized
automatic fryers, going forward, we plan to deploy an intelligent ambience
management system that can automatically optimize the music tracks and streaming
conditions according to the number of customers and on-site ambience, an
intelligent expansion model that can effectively delineate the bar location planning
and predict the performance trend of new bars at the outset of their operation, a
smart cleaning system capable of doing automatic detection and cleaning and an
automatic inventory control system. We believe these planned research and
development projects can better serve our goal to provide a relaxing offline social
space for young customers, promote their consumption and social interaction
experience. For details of enhancing the construction of our infrastructural capacity,
see “Business – Our Development Strategies – Continuous Investments in the
Construction of Infrastructural Capacity.”
• approximately [REDACTED]%, or HK$[REDACTED] will be used for further
strengthening the brand awareness of the Helen’s. We will further enhance the
awareness of the Helen’s brand in the minds of customers and continue to increase
the awareness among target customer groups and consumer stickiness. Specifically,
we plan to use i) approximately [REDACTED]%, or HK$[REDACTED]to
broaden our marketing channels and increase our outreach to customers, which
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include Weixin and Douyin advertising and other social media promotions, in
details, and ii) approximately [REDACTED]%, or HK$[REDACTED] to expand
and optimize our branded product portfolio through the big data analysis and
continuous communications with customers, which include advertising in office
buildings, public transportation and cooperation with third-party platforms, in
details. For details of plans to strengthen our brand awareness, see “Business – Our
Development Strategies – Strengthening Brand Image and Consumer Awareness.”
• the remaining approximately [REDACTED]%, or HK$[REDACTED] will be used
for working capital and general corporate purposes.
The above allocation of the [REDACTED] will be adjusted on a pro rata basis in the event that
the [REDACTED] is fixed at a higher or lower level compared to the mid-point of the
estimated [REDACTED] range.
If the [REDACTED] is exercised in full, and [REDACTED] that we will receive will be
approximately HK$[REDACTED] million, assuming an [REDACTED]of
HK$[REDACTED] per Share (being the mid-point of the indicative [REDACTED] range). In
the event that the [REDACTED] is exercised in full, we intend to apply the additional
[REDACTED] to the above purpose in the proportions stated above.
To the extent that the [REDACTED] are not immediately applied to the above purposes and
to the extent permitted by the relevant law and regulations, we intend to deposit the
[REDACTED] into short-term demand deposits with licensed banks or authorized financial
institutions in Hong Kong or the PRC. We will make an appropriate announcement if there is
any change to the above proposed [REDACTED] or if any amount of the [REDACTED] will
be used for general corporate purposes.
FUTURE PLANS AND [REDACTED]
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