People

The People Running This Company

Governance grade: C+. This is a founder-controlled company where one man owns ~68% through a Cayman discretionary trust, holds every executive and strategic chair (Chairman + CEO + Nomination Committee Chair + Remuneration Committee seat), and has used that control to pay himself ~$50M in dividends over FY2023–FY2024 while same-store sales fell 21% and the company pivoted from operating 767 bars to an asset-light franchise model that shed hundreds of self-operated locations. The board is small, formally compliant with HK Listing Rules, and includes genuinely credible INEDs — but it exists around the founder, not above him.

1. The People Running This Company

Xu Bingzhong is the story. He founded Helen's in 2009, took it public on HKEX in 2021, added a Singapore introduction in July 2024, and has weathered a brutal 70% revenue collapse from FY2022 peak to FY2024 without ceding any governance power. His 20+ years in the bar business is real domain expertise — but his control is also why there is no succession plan on record, no president, and no COO at the parent level.

Yu Zhen, the CFO, is 32 years old with four years of CICC investment banking experience before joining. She is appropriately credentialed (Wuhan BA, Peking University MTax, CPA, ACCA) but young for the role and hired directly by the founder on the eve of the IPO. Her total FY2024 pay (RMB 624k ≈ $88k) is modest enough that it signals alignment via RSUs rather than cash.

He Daqing is the unusual addition: a former Communist Party publicity official and Xinhua News Agency editor with no operational bar background, upgraded from non-executive to executive director in September 2023 and made COO of the key operating subsidiary. His skill-set looks more aligned with regulatory/media navigation in China than with restaurant operations.

2. What They Get Paid

Total board cash compensation for FY2024 was RMB 2.01 million — roughly $284k in total for seven directors for a HKD 1.4bn market-cap company. That is extraordinarily modest and, on its face, shareholder-friendly. Xu himself drew only RMB 263k (~$37k) in salary, less than each of the three independent directors, and less than his junior CFO.

The real payoff is structural, not salaried. Through the HHL International → HLSH Holding → Cantrust discretionary trust structure, Xu received roughly $37M in FY2023 dividends and $14M in FY2024 from his 861 million shares — i.e. the dividend policy, not the payroll, is how the founder is compensated. That is legitimate for a founder with 68% of the company, but it means the incentive to pay large dividends during a period of declining revenue (FY2022 RMB 1.56bn → FY2024 RMB 753M) is entirely his to set.

3. Are They Aligned?

Ownership: one man, one trust, one vote bloc

Xu's 68.04% stake translates to absolute control of every Listing Rule threshold that matters: ordinary resolutions (50%), special resolutions (75% — no, but 68% + sympathetic minority easily clears), related-party approvals, and board composition. The minimum public float is only ~20.7% and Xu was granted a waiver from the standard 25% float requirement at IPO. Institutional ownership is negligible (top outside holders total well under 1%), so effectively no outside voice on governance.

Insider activity: no reported trades, but plenty of signaling

No Director sold shares during FY2024 per the Directors' Interests disclosure. HKEX insider disclosures (DI forms) are not structured in the fetched data, but two observable capital-allocation events serve as insider signals:

1. FY2023 dividend of RMB 0.3153/share — a special/elevated payout that extracted RMB 400M total (~$56M) shortly after the business turned loss-making in FY2022 (RMB -1.60bn net loss). Xu's cut: ~$37M.
2. A 10% buyback authorization (Nov 2025) for up to 126.5M shares — announced after the share price had already collapsed from the HKD 25 IPO peak to under HKD 1. That IS shareholder-friendly at these prices, but it comes after the dividend strip, not instead of it.

Capital allocation track record: mixed, with one hard lesson

The FY2024 dividend (RMB 593M) was 3.3x FY2024 net income and was paid out of share premium reserves, not earnings. This is the central capital-allocation question for this stock: the founder used IPO proceeds to build a 767-bar empire, shut down hundreds of self-operated locations at a ~RMB 1.6bn impairment, then recycled the accumulated IPO-era share premium back out to himself (and the 32% float) as dividends while the operating business shrank to roughly one-third of its FY2022 revenue peak. Of the HK$2,980M raised at IPO, HK$486M (~16%) remained unutilized at end of FY2024 with the deployment deadline pushed from 2024 to 2027.

Related-party transactions: small in $, troubling in pattern

Related-party dollar volume is small (RMB 4.8M in FY2024 for "purchase of plant and equipment" from a Xu-controlled entity). But Xu owning 25% stakes in three outside companies that sell fixtures and technology services to the listed company is a textbook self-dealing structure worth monitoring — especially as the company transitions to "HiBeer Partnership" franchising where fixtures/fit-out supply contracts could scale. There is also a RMB 7.5M receivable owed to Helens by Shenzhen Jiangzhu (up from RMB 2.2M year earlier) with no disclosed settlement terms.

Skin-in-the-game score

Xu's equity stake makes alignment structurally strong — he loses more than anyone if the stock falls. What weights against a higher score: (a) he has already extracted ~$50M in dividends over two years, (b) no Directors are buying in the open market, and (c) the Post-IPO RSU pool is shallow and not being used to bind operating managers to long-term performance.

4. Board Quality

Board size (7) meets HK Listing Rules minimums — three INEDs, one-third independence, one INED with accounting qualifications (Li Dong, Audit Chair). Attendance in FY2024 was perfect across all seven directors and all meetings. That is the good news.

The structural weaknesses:

1. The Chair is the CEO is the Nomination Chair. Xu Bingzhong picks the people who will later evaluate him. The board's "independent evaluation mechanism" is self-reported.
2. The Remuneration Committee includes Xu himself — he is a member of the committee that sets executive pay. This directly contradicts the spirit of HK Code provision B.1 (non-executives should determine executive remuneration).
3. INED credentials are real but stretched thin. Li Dong is CFO of TH International (NASDAQ: THCH) and INED at three other HK-listed companies (ZJLD, Logory) — four board mandates plus a full-time CFO role. Wong Heung Ming Henry sits on at least five listed-company boards concurrently, including multiple very small NASDAQ-listed shells (Intelligent Joy, SAI.TECH, Aimei), and has a pattern of directorships at companies that have since delisted (Sinosoft, Sansheng Holdings). Wong resigned effective 11 July 2025 "to devote more time to other business endeavours" — an understated but telling exit.
4. Wang Renrong is the most operationally credible INED — 19 years at Budweiser APAC as Vice President of Legal and Corporate Affairs. He chairs Remuneration and sits on Audit and Nomination. Losing him would leave the board materially weaker.

Auditor and internal controls

PricewaterhouseCoopers has been the auditor since IPO (unchanged), which is appropriate for a company of this size. The FY2024 corporate governance report states the Board considers internal controls "effective and adequate" and the Anti-Fraud / Whistleblower policy is documented. There is no disclosed fraud, regulatory action, or restatement.

5. The Verdict

Governance grade: C+

What's good. The founder has real operating history (16 years in the bar business), the board meets HK Listing Rules minimums in letter, attendance is perfect, PwC has audited continuously, and executive cash compensation is genuinely modest. Xu's 68% stake means his financial interest is overwhelmingly aligned with the share price — he is the last person who wants this stock at HKD 1.

What's concerning. Chair + CEO + Nomination Chair + Remuneration Committee member in one person is a Code violation the company has no intention of fixing. The ~$50M dividend strip across FY2023–FY2024 — funded largely out of IPO-era share premium while operating revenue collapsed 52% — is the kind of extraction that is legal, disclosed, and correctly approved, but raises the question of whether the controlling shareholder is treating the listed vehicle as a going concern or as a cash-out. Related-party counterparties (three 25%-Xu-owned suppliers) are small today but sit exactly where margin leakage would hide in a franchise-heavy model. The INED bench is thin and getting thinner after Wong's July 2025 resignation.

What would upgrade it. (a) Separating the Chair and CEO roles, (b) a credible new INED with HK F&B operating experience, (c) removing Xu from the Remuneration Committee, (d) a dividend policy that scales with operating cash flow rather than share-premium depletion, (e) Xu or any ED buying in the open market.

What would downgrade it. (a) Any expansion of related-party purchases to Xu's 25%-owned vendors as the HiBeer franchise platform scales, (b) further INED turnover without upgrade, (c) a second elevated special dividend funded from reserves rather than earnings, (d) any transfer of the "HiBeer Partnership" IP or platform to a Xu-controlled private entity.