[Corporate Information](index=8&type=section&id=Corporate%20Information) This section details the company's core corporate information, including board members, committee structures, key senior management, legal advisors, auditors, share registrars, and principal bankers - The report provides detailed core corporate information, including the company's board members, committee structures, key senior management, legal advisors, auditors, share registrars, and principal bankers[47](index=47&type=chunk)[48](index=48&type=chunk)[51](index=51&type=chunk) [Chairman's Statement](index=11&type=section&id=Chairman%27s%20Statement) The Group's total turnover increased by 5.8% to HK$135.5 million, with net loss attributable to owners narrowing to HK$73.7 million due to reduced fair value losses, while a new hotel was opened in Kaifeng amidst future geopolitical and economic uncertainties Key Financial Indicators for FY2025 | Indicator | 2025 FY (Approx.) | 2024 FY (Approx.) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Total Turnover | HK$135.5 million | HK$128.1 million | +5.8% | | Net Loss Attributable to Owners | HK$73.7 million | HK$75.7 million | -2.6% | | Loss Per Share | 5.03 HK cents | 5.16 HK cents | -2.5% | | Consolidated Net Assets | HK$1,242 million | HK$1,342 million | -7.5% | | Consolidated Net Assets Per Share | HK$0.85 | HK$0.91 | -6.6% | - The reduction in net loss was primarily driven by a decrease in fair value loss on investment properties from **HK$32.36 million to HK$14.09 million**, and a significant reduction in fair value loss on equity investments from **HK$104.9 million to HK$13.68 million** due to prior period disposals, partially offset by reduced dividend income (none this period, HK$74.87 million last period) and lower gains from investment property disposals[63](index=63&type=chunk) - The Group expanded its hotel business by establishing a new hotel in Kaifeng, China, during the reporting period to capitalize on the local rich cultural heritage and tourism potential[57](index=57&type=chunk) - Looking ahead, management anticipates potential economic volatility from geopolitical tensions, US Federal Reserve interest rate policies, and new tariff policies, while economic recovery in mainland China and the Hong Kong property market continue to face challenges[68](index=68&type=chunk) [Management Discussion and Analysis](index=13&type=section&id=Management%20Discussion%20and%20Analysis) Revenue Performance by Business Segment | Business Segment | 2025 FY Revenue (Approx.) | 2024 FY Revenue (Approx.) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Property Development and Investment | HK$76.11 million | HK$86.28 million | -12% | | Trading Business | HK$40.26 million | HK$28.72 million | +40% | | Other Business (Hotel Operations) | HK$19.10 million | HK$13.08 million | +46% | | **Total** | **HK$135.47 million** | **HK$128.07 million** | **+6%** | [Business Review](index=14&type=section&id=BUSINESS%20REVIEW) The Group's total revenue increased by 6% to HK$135.5 million, primarily driven by 40% growth in trading and 46% in hotel operations, while property development and investment revenue declined by 12%, with trading business turning profitable due to a major order and hotel business benefiting from a new opening and higher occupancy [Property Development and Investment Business](index=14&type=section&id=Property%20development%20and%20investment%20business) This segment's revenue decreased by 12% to HK$76.11 million, with property sales down 19% due to a sale-and-leaseback transaction not recognized as revenue, while rental income grew 15% to HK$20.82 million, and operating loss narrowed significantly from HK$53.17 million to HK$27.19 million due to reduced fair value losses on investment properties Property Development and Investment Business Revenue Breakdown | Revenue Source | 2025 FY (Approx.) | 2024 FY (Approx.) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Property Sales | HK$55.29 million | HK$68.11 million | -19% | | Investment Property Rental Income | HK$20.82 million | HK$18.17 million | +15% | - The decline in property sales was primarily due to a sales transaction involving eight properties with a contract value of approximately **HK$39.63 million**, which was accounted for as a 'sale and leaseback transaction' and thus not recognized as sales revenue due to a subsequent leaseback agreement[82](index=82&type=chunk) - Segment operating loss decreased from **HK$53.17 million to HK$27.19 million**, primarily benefiting from a reduction in fair value loss on investment properties from **HK$32.36 million in the prior period to HK$14.09 million** in the current period[86](index=86&type=chunk) [Trading Business](index=16&type=section&id=Trading%20business) Trading business revenue grew 40% to HK$40.26 million, turning profitable with an operating profit of HK$2.35 million (compared to a HK$2.78 million loss last year), primarily driven by a 51% increase in medical equipment sales due to a HK$9.5 million order from the Hong Kong Hospital Authority, while home security and automation product revenue decreased by 30% due to business termination in China and reduced Hong Kong demand Trading Business Revenue Breakdown | Revenue Source | 2025 FY (Approx.) | 2024 FY (Approx.) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Medical Equipment, Health and Epidemic Prevention Products | HK$37.47 million | HK$24.75 million | +51% | | Home Security and Automation Products | HK$2.79 million | HK$3.97 million | -30% | - The significant growth in medical equipment sales is primarily attributed to a large order recognized during the reporting period from the Hong Kong Hospital Authority for the sale and installation of a hydrotherapy pool at United Christian Hospital, with a contract value of approximately **HK$9.5 million**[94](index=94&type=chunk) - This segment turned from a loss of **HK$2.78 million last year to a profit of HK$2.35 million**, primarily due to improved sales performance[97](index=97&type=chunk) [Other Business (Principally Hotel Operations)](index=17&type=section&id=Other%20business%2C%20principally%20operation%20of%20hotels) Hotel business revenue increased by 46% to HK$19.10 million, primarily due to the addition of a new Orange Hotel which achieved an 86% average occupancy rate since October 2024, while Holiday Inn Express also saw occupancy rise from 37% to 44%, leading to a narrowed operating loss from HK$10.12 million to HK$6.26 million Hotel Performance | Hotel Name | Opening Date | 2025 Average Occupancy Rate | 2024 Average Occupancy Rate | 2025 Average Room Rate (RMB) | 2025 Average RevPAR (RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | | Holiday Inn Express | January 2020 | 44% | 37% | 221 | 115 | | Orange Hotel | October 2024 | 86% | Not Applicable | 315 | 270 | - The 46% revenue growth is primarily due to the Group increasing its number of operating hotels from one to two during the reporting period[98](index=98&type=chunk) - The newly opened Orange Hotel recorded a total turnover of approximately **HK$4.74 million** from October 2024 to March 31, 2025, with an average occupancy rate as high as **86%**[110](index=110&type=chunk) [Financial Review](index=21&type=section&id=FINANCIAL%20REVIEW) The Group's revenue grew 6% this year, with gross profit margin improving from 33% to 42% due to higher-margin residential sales and rental income, while other income and gains significantly decreased by 74% to HK$24 million due to prior year's substantial dividend income, and liquidity remained healthy with current ratio increasing to 2.28 and net gearing ratio decreasing to 17%, with capital expenditure primarily for new hotel leases and renovations Key Financial Ratios | Indicator | 2025 FY | 2024 FY | | :--- | :--- | :--- | | Gross Profit Margin | 42% | 33% | | Current Ratio | 2.28 | 1.80 | | Net Gearing Ratio | 17% | 24% | - Gross profit margin increased by **9 percentage points**, primarily due to higher gross margins from residential apartment sales in the current period and an increase in the proportion of high-margin rental income within the property segment's total revenue from **21% to 27%**[122](index=122&type=chunk)[123](index=123&type=chunk) - Other income and gains significantly decreased from **HK$93 million to HK$24 million**, mainly because the prior year included **HK$74.87 million** in dividend income from a disposed equity investment, which was absent in the current period[126](index=126&type=chunk) - Total capital expenditure for the year was approximately **HK$52.78 million**, primarily for the acquisition of right-of-use assets for property leases and leasehold improvements for the newly opened Orange Hotel[135](index=135&type=chunk) [Prospects](index=24&type=section&id=PROSPECTS) Looking ahead, the Group anticipates global economic uncertainties from geopolitics, high interest rates, and trade conflicts, while mainland China's property market recovery remains challenging despite government support, with the Group continuing sales and leasing of Kaifeng projects, expanding medical equipment and AI video analysis through associates, and leveraging Kaifeng's tourism potential in hotel operations while implementing strict cost controls - **Property Development and Investment**: Despite various government policies to stabilize the real estate market in mainland China, market recovery remains challenging. The Group will continue to sell and lease the remaining areas of its 'Century Mansion' and 'Expo Plaza' projects in Kaifeng[149](index=149&type=chunk)[154](index=154&type=chunk)[161](index=161&type=chunk) - **Medical Equipment**: Demand for medical equipment is expected to continue growing with rising living standards and health awareness. The Group, through its associate Hope4Care Limited, is developing a smart rehabilitation training platform and has obtained ISO13485 medical software certification[166](index=166&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk) - **Home Security and Automation Products**: The Group, through its associate Axxonsoft Hong Kong Limited, continues to promote AI video analysis technology for applications such as crowd analysis and security surveillance, having successfully secured major airport projects in mainland China[170](index=170&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk) - **Hotel Operations**: The Group is optimistic about Kaifeng's potential as a tourist city and will continue to enhance hotel service quality. Concurrently, the industry faces challenges such as staff shortages and rising operating costs, prompting the Group to implement strict cost control measures to maintain competitiveness[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk) [Report of the Directors](index=30&type=section&id=Report%20of%20the%20Directors) [Principal Activities](index=31&type=section&id=PRINCIPAL%20ACTIVITIES) The company's principal activity is investment holding, with its subsidiaries primarily engaged in (a) property development and investment; (b) trading of medical equipment and home security and automation products; and (c) hotel operations - The Group's core business segments encompass property, trading, and hotel operations[195](index=195&type=chunk) [Results and Appropriations](index=31&type=section&id=RESULTS%20AND%20APPROPRIATIONS) The Group recorded a loss for the year, and the Board does not recommend the payment of any final dividend, with no interim dividend paid during the year - The Board decided not to declare any final dividend for the current year, consistent with the previous year[196](index=196&type=chunk) [Principal Risks and Uncertainties](index=33&type=section&id=PRINCIPAL%20RISKS%20AND%20UNCERTAINTIES) The Group faces key risks including economic and policy risks related to the mainland China property market, increased financial costs from interest rate fluctuations, impact of fair value changes on investment properties, uncertainties in complex land appreciation tax calculations in mainland China, and high volatility in hotel operations influenced by seasonality, economic conditions, and pandemics - **Property Market Risk**: The Group's property development and investment business is highly concentrated in mainland China, making it susceptible to changes in local economic, political, and real estate regulatory policies[223](index=223&type=chunk) - **Financial Risk**: Rising interest rates will increase the Group's financing costs and customers' mortgage costs, while fair value revaluation of investment properties may cause non-cash fluctuations in the profit or loss statement[224](index=224&type=chunk)[229](index=229&type=chunk) - **Taxation Risk**: The calculation of land appreciation tax in mainland China is complex and varies by region, leading to uncertainty in the final tax amount, which could impact the Group's cash flow and financial position[230](index=230&type=chunk) - **Hotel Operations Risk**: Hotel performance is highly volatile and susceptible to various factors including seasonality, economic conditions, social stability, and pandemics[231](index=231&type=chunk) [Major Customers and Suppliers](index=40&type=section&id=MAJOR%20CUSTOMERS%20AND%20SUPPLIERS) This year, sales to the top five customers accounted for 53% of total sales, with the largest customer representing 27%, while purchases from the top five suppliers constituted 44% of total purchases, with the largest supplier at 18%, indicating an increase in both customer and supplier concentration Customer and Supplier Concentration | Concentration | 2025 FY | 2024 FY | | :--- | :--- | :--- | | Top Five Customers Sales Percentage | 53% | 46% | | Largest Customer Sales Percentage | 27% | 29% | | Top Five Suppliers Purchase Percentage | 44% | 42% | | Largest Supplier Purchase Percentage | 18% | 11% | [Directors' and Chief Executive's Interests in Shares, Underlying Shares and Debentures](index=43&type=section&id=DIRECTORS%27%20AND%20CHIEF%20EXECUTIVE%27S%20INTERESTS) As of March 31, 2025, Mr. Tse Man Shing, Managing Director and Chairman, held approximately 44.58% of the company's shares directly and indirectly, making him the controlling shareholder, with other directors also holding varying amounts of company shares Directors' Shareholdings (As of March 31, 2025) | Director Name | Total Shares Held | Percentage of Issued Share Capital | | :--- | :--- | :--- | | Mr. Tse Man Shing | 653,904,900 | 44.58% | | Mr. Wong King Ning | 39,644,100 | 2.70% | | Mr. Tse Wai Yip | 3,600,000 | 0.25% | | Dr. Ho Chung Tai | 727,500 | 0.05% | | Ir. Siu Man Po | 1,580,000 | 0.11% | [Substantial Shareholders' Interests in Shares and Underlying Shares](index=46&type=section&id=SUBSTANTIAL%20SHAREHOLDERS%27%20INTERESTS) As of March 31, 2025, substantial shareholders, excluding directors, include Sparta Assets Limited (wholly owned by Chairman Mr. Tse Man Shing) and Granda Overseas Holding Co., Ltd (wholly owned by Mr. Chan For Fat), holding 35.79% and 17.76% of the company's shares respectively Substantial Shareholders' Shareholdings (As of March 31, 2025) | Shareholder Name | Number of Shares Held | Percentage of Issued Share Capital | | :--- | :--- | :--- | | Sparta Assets Limited | 524,902,500 | 35.79% | | Granda Overseas Holding Co., Ltd | 260,548,110 | 17.76% | [Biographical Details of Directors and Senior Management](index=51&type=section&id=Biographical%20Details%20of%20Directors%20and%20Senior%20Management) This section provides detailed backgrounds, qualifications, and responsibilities of the company's executive directors, independent non-executive directors, and senior management team, highlighting the leadership of co-founder Mr. Tse Man Shing and the diverse professional expertise of the independent board members - **Executive Directors**: The core figure is Mr. Tse Man Shing, 81, co-founder, Managing Director, and Chairman, with over **40 years** of experience in the construction industry; his son, Mr. Tse Wai Yip, and daughter, Ms. Tse Hoi Ying, also serve as Executive Directors, responsible for AI business/property investment and medical equipment trading respectively[317](index=317&type=chunk)[323](index=323&type=chunk)[324](index=324&type=chunk) - **Independent Non-Executive Directors**: The team includes Dr. Ho Chung Tai (civil engineering expert), Ir. Siu Man Po (extensive experience in construction), Mr. Siu Kam Chau (practicing accountant), and Mr. Song Xiao Zhuang (structural engineering and legal background), providing professional oversight and independent judgment for corporate governance[329](index=329&type=chunk)[337](index=337&type=chunk)[340](index=340&type=chunk) - **Senior Management Team**: Includes Mr. Lam Wing Wai, Company Secretary and Financial Controller, along with project managers and senior product managers with extensive experience in mainland construction projects, intelligent security systems, and business development[348](index=348&type=chunk)[349](index=349&type=chunk)[350](index=350&type=chunk) [Corporate Governance Report](index=58&type=section&id=Corporate%20Governance%20Report) The company maintains high corporate governance standards, largely complying with the Corporate Governance Code, with the only deviation being the combined roles of Chairman and Managing Director held by Mr. Tse Man Shing, which the Board believes aids strategic execution, while the report details board structure, committee operations, risk management, internal controls, and shareholder communication policies [The Board](index=60&type=section&id=THE%20BOARD) The Board comprises eight members, including four executive and four independent non-executive directors, responsible for leading and approving company strategy, holding four meetings during the reporting period with full attendance, and has adopted and regularly reviews a board diversity policy - The Board comprises **eight members**, with independent non-executive directors constituting half, meeting listing rule requirements[366](index=366&type=chunk) Board and General Meeting Attendance | Director Name | Board Meetings | Annual General Meeting | Extraordinary General Meeting | | :--- | :--- | :--- | :--- | | Mr. Tse Man Shing | 4/4 | 1/1 | 1/1 | | Mr. Wong King Ning | 4/4 | 1/1 | 1/1 | | Mr. Tse Wai Yip | 4/4 | 1/1 | 1/1 | | Ms. Tse Hoi Ying | 4/4 | 1/1 | 1/1 | | Dr. Ho Chung Tai | 4/4 | 1/1 | 1/1 | | Ir. Siu Man Po | 4/4 | 1/1 | 1/1 | | Mr. Siu Kam Chau | 4/4 | 1/1 | 1/1 | | Mr. Song Xiao Zhuang | 4/4 | 1/1 | 1/1 | [Board Committees](index=70&type=section&id=BOARD%20COMMITTEES) The Board has three committees—Remuneration, Nomination, and Audit—all chaired by independent non-executive directors, responsible for reviewing remuneration policies, board composition and nominations, and overseeing financial reporting, risk management, and internal control systems, respectively, with each committee holding meetings and fulfilling its duties during the reporting period - **Remuneration Committee**: Composed of three independent non-executive directors and two executive directors, chaired by Mr. Siu Kam Chau, it held one meeting during the year to review remuneration policies and executive compensation packages[420](index=420&type=chunk) - **Nomination Committee**: Composed of three independent non-executive directors and two executive directors, chaired by Mr. Song Xiao Zhuang, it held one meeting during the year to review the Board's structure, size, and composition[422](index=422&type=chunk) - **Audit Committee**: Composed of three independent non-executive directors, chaired by Mr. Siu Kam Chau, it held two meetings during the year to review financial reporting, internal control systems, and the appointment of external auditors[458](index=458&type=chunk)[459](index=459&type=chunk) [Risk Management and Internal Monitoring](index=88&type=section&id=RISK%20MANAGEMENT%20AND%20INTERNAL%20MONITORING) The Group has established effective risk management and internal control systems, with the risk management system covering identification, assessment, and management phases, and internal controls compatible with the COSO 2013 framework, encompassing five key components, which the Board, through internal audit and Audit Committee review, deemed effective and adequate for the year - The Group's risk management system includes three stages: risk identification, assessment, and management, with no significant risks identified based on this year's risk assessment[505](index=505&type=chunk)[506](index=506&type=chunk) - The internal control system complies with the COSO 2013 framework and features an independent internal audit function, conducting reviews semi-annually and reporting to the Audit Committee and the Board[507](index=507&type=chunk)[514](index=514&type=chunk) - The Board conducted an annual review of the effectiveness of the risk management and internal control systems, concluding that the systems are effective and adequate, with sufficient resources and qualified personnel[518](index=518&type=chunk)[519](index=519&type=chunk) [Independent Auditor's Report](index=93&type=section&id=Independent%20Auditor%27s%20Report) Tannick Hong Kong Certified Public Accountants Limited issued an unmodified opinion on the Group's consolidated financial statements as of March 31, 2025, affirming they present a true and fair view of the Group's financial position, performance, and cash flows, while identifying and detailing audit procedures for two key audit matters: valuation of investment properties and assessment of net realizable value of completed properties held for sale - The auditor issued an unmodified opinion, stating that the financial statements present a true and fair view of the Group's financial position[542](index=542&type=chunk) - Key Audit Matter One: **Valuation of Investment Properties**. Given the significant amount of investment properties (**HK$642 million**) and the substantial judgment and assumptions involved in valuation (e.g., rental values, capitalization rates), the auditor assessed the competence of the external valuer and evaluated the reasonableness of the valuation methodologies and key assumptions[549](index=549&type=chunk)[553](index=553&type=chunk) - Key Audit Matter Two: **Assessment of Net Realizable Value of Completed Properties Held for Sale**. As properties held for sale are material (**HK$459 million**) and the assessment of net realizable value is subjective, the auditor evaluated the external valuer's report and examined the input data used in the valuation, such as market selling prices of comparable properties[558](index=558&type=chunk)[564](index=564&type=chunk) [Audited Financial Statements](index=102&type=section&id=Audited%20Financial%20Statements) [Consolidated Statement of Profit or Loss](index=103&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) For the year ended March 31, 2025, the Group's revenue was HK$135.5 million, a 6% increase year-on-year, with gross profit growing 34% to HK$57.52 million; however, due to a significant decrease in other income and increased administrative expenses, the loss for the year was HK$75.89 million, largely consistent with the prior year's HK$76.77 million, with loss attributable to owners at HK$73.72 million Consolidated Statement of Profit or Loss Summary | Item (HK$ thousand) | 2025 FY | 2024 FY | | :--- | :--- | :--- | | Income | 135,468 | 128,074 | | Gross Profit | 57,517 | 42,902 | | Other Income and Gains | 24,200 | 92,864 | | Loss Before Tax | (76,014) | (61,641) | | **Loss for the Year** | **(75,889)** | **(76,774)** | | Loss Attributable to Owners of the Company | (73,724) | (75,691) | | **Basic and Diluted Loss Per Share** | **(5.03 HK cents)** | **(5.16 HK cents)** | [Consolidated Statement of Financial Position](index=104&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, the Group's total assets decreased to HK$1,742 million from HK$1,979 million, primarily due to reduced properties held for sale and certain receivables, while total liabilities decreased from HK$637 million to HK$500 million, resulting in net assets of HK$1,242 million and an improved net current assets position from HK$379 million to HK$397 million, indicating enhanced short-term solvency Consolidated Statement of Financial Position Summary | Item (HK$ thousand) | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | **Non-current Assets** | **1,036,760** | **1,125,138** | | Of which: Investment Properties | 641,576 | 661,908 | | **Current Assets** | **705,328** | **853,646** | | Of which: Properties Held for Sale | 459,313 | 580,992 | | **Total Assets** | **1,742,088** | **1,978,784** | | **Current Liabilities** | **308,766** | **475,128** | | **Non-current Liabilities** | **191,412** | **162,066** | | **Total Liabilities** | **500,178** | **637,194** | | **Net Assets** | **1,241,910** | **1,341,590** | [Consolidated Statement of Cash Flows](index=108&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) This year, net cash flow from operating activities significantly improved to HK$37.32 million from a net outflow of HK$32.44 million in the prior year, while net cash inflow from investing activities was HK$115 million, primarily from prior year's disposal of subsidiaries and investment properties, and net cash outflow from financing activities was HK$154 million, mainly for repayment of bank and other borrowings, with cash and cash equivalents at year-end totaling HK$18.34 million Consolidated Statement of Cash Flows Summary | Item (HK$ thousand) | 2025 FY | 2024 FY | | :--- | :--- | :--- | | Net Cash Flows from/(used in) Operating Activities | 37,321 | (32,442) | | Net Cash Flows from Investing Activities | 115,193 | 148,254 | | Net Cash Flows used in Financing Activities | (154,358) | (102,869) | | **Net (Decrease)/Increase in Cash and Cash Equivalents** | **(1,844)** | **12,943** | | Cash and Cash Equivalents at Beginning of Year | 20,399 | 8,660 | | **Cash and Cash Equivalents at End of Year** | **18,341** | **20,399** | [Notes to the Consolidated Financial Statements](index=111&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes to the financial statements provide detailed explanations and supplementary information for key financial statement items, including significant accounting policies, segment operating information, valuation details for investment properties and properties held for sale, financial instrument risk management, related party transactions, and detailed breakdowns of various assets and liabilities - **Segment Information (Note 4)**: The report provides detailed disclosure of revenue, results, assets, and liabilities for the three segments: property development and investment, trading business, and hotel operations[851](index=851&type=chunk) - **Investment Properties (Note 15)**: As of March 31, 2025, investment properties had a carrying amount of **HK$642 million**, revalued by independent professional valuers, with a net fair value adjustment loss of **HK$14.09 million** recorded for the current year[955](index=955&type=chunk) - **Interest-bearing Bank and Other Borrowings (Note 26)**: As of March 31, 2025, the Group's total interest-bearing borrowings amounted to **HK$194 million**, of which **HK$151 million** were current liabilities, with some borrowings secured by the Group's properties and deposits[1054](index=1054&type=chunk)[1062](index=1062&type=chunk) [Summary of Financial Information](index=251&type=section&id=Summary%20of%20Financial%20Information) This section provides a summary of the Group's key financial data for the past five fiscal years (2021-2025), including results, assets, liabilities, and non-controlling interests, showing relatively stable revenue but continuous annual losses, with total assets and liabilities trending downwards in the last two years Five-Year Financial Performance Summary (HK$ million) | Fiscal Year | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 135.5 | 128.1 | 97.6 | 110.0 | 103.8 | | Loss for the Year | (75.9) | (76.8) | (93.9) | (31.0) | (38.9) | | Loss Attributable to Owners of the Company | (73.7) | (75.7) | (91.0) | (27.3) | (36.7) | Five-Year Assets and Liabilities Summary (HK$ million) | Fiscal Year | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 1,742.1 | 1,978.8 | 2,262.8 | 2,469.8 | 2,391.0 | | Total Liabilities | (500.2) | (637.2) | (795.5) | (797.7) | (804.6) |

Trading Information Summary - On July 8, ST Ruihe experienced a net outflow of 995,800 CNY from main funds, while speculative funds saw a net inflow of 1,414,000 CNY, and retail investors had a net outflow of 418,200 CNY [1][3] Company Announcement Summary - Shenzhen Ruihe Decoration Co., Ltd. (ST Ruihe) reported a total of 12 litigation and arbitration cases over the past twelve months, with a total amount involved of approximately 15.418 million CNY. Among these, three new cases reported on July 8, 2025, amounted to 11.2133 million CNY, exceeding 10% of the company's most recent audited net assets [1][3] - The company confirmed that there are no individual litigation or arbitration cases exceeding 10% of the most recent audited net assets with an absolute amount over 10 million CNY. Additionally, there are no other undisclosed litigation or arbitration matters [1][3] - The ongoing cases are still in the stages of not being heard or lacking final judgments, leading to uncertainty regarding their impact on the company's current or future profits. The company will handle accounting in accordance with relevant standards and will fulfill disclosure obligations as required [1]

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Overall Financial Performance](index=1&type=section&id=Financial%20Performance) For the year ended March 31, 2025, the Group's revenue grew 5.8% to HKD 135 million, with gross profit up 34.1% to HKD 57.52 million, while net loss remained stable at HKD 75.89 million due to reduced other income and fair value losses Consolidated Income Statement Key Metrics (HKD Thousands) | Metric | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 135,468 | 128,074 | +5.8% | | Gross Profit | 57,517 | 42,902 | +34.1% | | Other Income and Gains | 24,200 | 92,864 | -74.0% | | Loss Before Tax | (76,014) | (61,641) | +23.3% | | Loss for the Year | (75,889) | (76,774) | -1.2% | | Loss Attributable to Owners of the Company | (73,724) | (75,691) | -2.6% | - Basic and diluted loss per share narrowed from **5.16 HK cents** to **5.03 HK cents** compared to the prior year[4](index=4&type=chunk) - Total comprehensive loss for the year significantly decreased to **HKD 99.76 million** from **HKD 126 million** in the prior year, primarily due to a narrower loss from exchange differences[5](index=5&type=chunk) [Financial Position](index=4&type=section&id=Financial%20Position) As of March 31, 2025, the Group's total assets decreased by 12.0% to HKD 1.742 billion, total liabilities fell by 21.5% to HKD 500 million, and net assets declined by 7.4% to HKD 1.242 billion, while the current ratio improved to 2.28 Consolidated Statement of Financial Position Key Metrics (HKD Thousands) | Metric | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Non-Current Assets | 1,036,760 | 1,125,138 | -7.9% | | Total Current Assets | 705,328 | 853,646 | -17.4% | | **Total Assets** | **1,742,088** | **1,978,784** | **-12.0%** | | Total Current Liabilities | 308,766 | 475,128 | -35.0% | | Total Non-Current Liabilities | 191,412 | 162,066 | +18.1% | | **Total Liabilities** | **500,178** | **637,194** | **-21.5%** | | **Net Assets** | **1,241,910** | **1,341,590** | **-7.4%** | - The Group's net current assets increased from **HKD 379 million** to **HKD 397 million**, and the current ratio (current assets/current liabilities) improved from **1.80** to **2.28**[6](index=6&type=chunk) [Notes to the Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [Note 3: Operating Segments](index=9&type=section&id=Note%203%3A%20Operating%20Segments) The Group operates in property development and investment, trading, and hotel operations, with property being the largest revenue source but loss-making, while trading revenue significantly grew to profitability, and hotel revenue increased but remained at a loss, with mainland China contributing most revenue and non-current assets 2025 Segment Performance (HKD Thousands) | Business Segment | Revenue from External Customers | Segment Results | Segment Assets | | :--- | :--- | :--- | :--- | | Property Development and Investment | 76,108 | (27,193) | 1,441,365 | | Trading Business | 40,262 | 2,347 | 23,959 | | Other (Hotel Operations) | 19,098 | (6,257) | 166,563 | | **Total** | **135,468** | **(31,103)** | **1,631,887** | - Compared to the prior year, the property development and investment segment loss significantly narrowed from **HKD 53.17 million** to **HKD 27.19 million**, while the trading business turned from a loss of **HKD 2.78 million** to a profit of **HKD 2.35 million**[22](index=22&type=chunk)[24](index=24&type=chunk) Revenue and Non-Current Assets by Geographical Region (HKD Thousands) | Region | Revenue from External Customers (2025) | Non-Current Assets (2025) | | :--- | :--- | :--- | | Hong Kong | 37,745 | 103,642 | | Mainland China | 97,723 | 899,541 | [Note 4: Revenue, Other Income and Gains](index=15&type=section&id=Note%204%3A%20Revenue%2C%20Other%20Income%20and%20Gains) Total revenue for the year was HKD 135 million, with HKD 115 million from customer contracts; property development revenue declined, but trading and hotel operations saw significant growth, while other income and gains sharply decreased by 74% to HKD 24.20 million due to the absence of prior year's substantial dividend income Revenue Source Analysis (HKD Thousands) | Revenue Source | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Property Development and Investment | 55,290 | 68,114 | -18.8% | | Trading Business | 40,262 | 28,715 | +40.2% | | Hotel Operations | 19,098 | 13,075 | +46.1% | | Investment Property Rental | 20,818 | 18,170 | +14.6% | | **Total Revenue** | **135,468** | **128,074** | **+5.8%** | - Other income and gains significantly decreased from **HKD 92.86 million** last year to **HKD 24.20 million** this year, primarily because the prior year included **HKD 74.87 million** in dividend income from equity investments, which was zero this year[38](index=38&type=chunk) [Note 6: Taxation](index=19&type=section&id=Note%206%3A%20Taxation) The Group recorded an income tax credit of HKD 0.125 million this year, a shift from last year's HKD 15.13 million tax expense, primarily due to changes in deferred tax, reversal of prior year over-provisions, and a significant reduction in current tax expenses in mainland China Tax Expense Components (HKD Thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Current Tax - Mainland China | 2,589 | 35,437 | | Land Appreciation Tax | (470) | 1,475 | | Deferred Tax | (2,522) | (18,750) | | **Total Tax (Credit)/Expense** | **(125)** | **15,133** | - The Group did not need to make provision for Hong Kong profits tax for the fiscal years 2025 and 2024 due to no assessable profits or sufficient tax losses carried forward in Hong Kong[39](index=39&type=chunk) [Note 7 & 8: Dividends and Loss Per Share](index=19&type=section&id=Note%207%20%26%208%3A%20Dividends%20and%20Loss%20Per%20Share) The company declared no dividends in fiscal years 2025 and 2024, with basic and diluted loss per share attributable to ordinary shareholders narrowing slightly to 5.03 HK cents in 2025 from 5.16 HK cents in the prior year - The company did not declare any dividends for the years ended March 31, 2025, and 2024[42](index=42&type=chunk) Loss Per Share Calculation | Item | 2025 | 2024 | | :--- | :--- | :--- | | Loss Attributable to Owners (HKD Thousands) | 73,724 | 75,691 | | Weighted Average Number of Ordinary Shares in Issue (Shares) | 1,466,820,600 | 1,466,820,600 | | **Basic Loss Per Share (HK Cents)** | **(5.03)** | **(5.16)** | [Management Discussion & Analysis](index=28&type=section&id=Management%20Discussion%20%26%20Analysis) [Business Review](index=28&type=section&id=Business%20Review) The Group's total revenue grew 6% to HKD 135 million, driven by strong trading and hotel business growth, while property development and investment revenue declined, its segment operating loss narrowed due to reduced fair value losses, and net loss attributable to owners slightly narrowed to HKD 73.72 million - The Group's total revenue was approximately **HKD 135 million**, an increase of approximately **6%** from the prior year[65](index=65&type=chunk) - Net loss attributable to owners decreased, primarily due to (i) reduced fair value losses on investment properties and (ii) reduced fair value losses on equity investments, though these positive factors were partially offset by (i) decreased dividend income and (ii) reduced gains from disposal of subsidiaries and investment properties[81](index=81&type=chunk)[83](index=83&type=chunk) - Excluding non-recurring items, the core business net loss narrowed from **HKD 60.26 million** last year to **HKD 42.05 million** this year[81](index=81&type=chunk) [Property Development and Investment Business](index=28&type=section&id=Property%20Development%20and%20Investment%20Business) Revenue for this segment decreased by 12% to HKD 76.11 million due to a weak mainland China property market and unrecognised sale-and-leaseback revenue, yet segment operating loss significantly narrowed from HKD 53.17 million to HKD 27.19 million due to reduced fair value losses on investment properties and higher sales gross margins - Segment revenue was approximately **HKD 76.11 million**, a year-on-year decrease of approximately **12%**, with property sales revenue falling **19%** to **HKD 55.29 million** and investment property rental income rising **15%** to **HKD 20.82 million**[66](index=66&type=chunk)[68](index=68&type=chunk)[70](index=70&type=chunk) - Segment operating loss narrowed from **HKD 53.17 million** to **HKD 27.19 million**, primarily due to reduced fair value losses on investment properties and higher gross margins on properties sold during the period[71](index=71&type=chunk) [Trading Business](index=30&type=section&id=Trading%20Business) The trading business performed strongly, with revenue significantly increasing by 40% to HKD 40.26 million and achieving a turnaround to an operating profit of HKD 2.35 million, primarily driven by medical equipment, health, and epidemic prevention product sales, notably a large order from the Hong Kong Hospital Authority - Segment revenue was approximately **HKD 40.26 million**, a significant year-on-year increase of approximately **40%**[72](index=72&type=chunk) - Sales revenue from medical equipment, health, and epidemic prevention products significantly increased by **51%** to **HKD 37.47 million**, primarily benefiting from a major contract for the sale and installation of hydrotherapy pools to the Hong Kong Hospital Authority[73](index=73&type=chunk) - This segment achieved a turnaround to profitability, recording an operating profit of approximately **HKD 2.35 million** (compared to a loss of **HKD 2.78 million** in the prior year)[75](index=75&type=chunk) [Other Business (Hotel Operations)](index=31&type=section&id=Other%20Business%20%28Hotel%20Operations%29) Hotel business revenue significantly increased by 46% to HKD 19.10 million, primarily due to the addition of a new Orange Hotel with an 86% occupancy rate, driving overall growth; despite increased revenue, the segment still recorded an operating loss of HKD 6.26 million due to property revaluation losses, though the loss narrowed from the prior year - Segment revenue was approximately **HKD 19.10 million**, a significant year-on-year increase of **46%**, primarily due to the Group operating two hotels during the reporting period (compared to one last year)[76](index=76&type=chunk) Hotel Operations Performance | Hotel Name | Opening Date | Average Occupancy Rate (2025) | Average Room Rate (2025, RMB) | | :--- | :--- | :--- | :--- | | Holiday Inn Express | January 2020 | 44% | 221 | | Orange Hotel | October 2024 | 86% | 315 | - Segment operating loss narrowed from **HKD 10.12 million** to **HKD 6.26 million**[80](index=80&type=chunk) [Financial Review](index=34&type=section&id=Financial%20Review) This year, the Group's revenue grew 6%, and gross margin significantly improved from 33% to 42%, primarily due to higher-margin residential apartment sales and increased rental income proportion, while other income and gains sharply decreased by 74% due to a high base of dividend income in the prior year - The increase in revenue was primarily due to significant sales contracts in the trading segment and the operation of the new Orange Hotel[84](index=84&type=chunk) - Gross margin increased from **33%** to **42%**, mainly due to (i) higher gross margins on residential apartments sold during the period and (ii) the proportion of high-margin rental income increasing from **21%** to **27%** of total revenue[85](index=85&type=chunk) - Other income and gains significantly decreased by **74%**, primarily because the prior year included **HKD 74.87 million** in dividend income, which was absent this period[86](index=86&type=chunk) [Liquidity, Financial Resources and Gearing Ratio](index=35&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Gearing%20Ratio) The Group maintained a healthy liquidity position, with working capital primarily from internal resources and borrowings; at period-end, the current ratio improved from 1.80 to 2.28, and the net gearing ratio decreased from 24% to 17%, indicating reduced financial leverage Liquidity and Gearing Ratios | Metric | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Current Ratio | 2.28 | 1.80 | | Net Gearing Ratio | 17% | 24% | - The Group's total assets of approximately **HKD 1.742 billion** were funded by total liabilities of **HKD 500 million**, shareholders' equity of **HKD 1.255 billion**, and non-controlling interests (loss of **HKD 13.57 million**)[89](index=89&type=chunk) [Outlook](index=36&type=section&id=Outlook) Looking ahead, the Group plans to develop its three business segments: property will benefit from mainland China's supportive policies despite economic uncertainties, continuing sales and leasing of Kaifeng projects; trading will expand medical equipment distribution and promote AI video analytics; and hotel operations will leverage Kaifeng's tourism potential to enhance service quality amidst challenges - **Property Development and Investment**: Despite global economic uncertainties, China's government property support policies and domestic demand are expected to stabilize the market, and the Group will continue to sell and lease remaining properties at Kaifeng Century Mansion and Kaifeng Expo Plaza[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk)[102](index=102&type=chunk) - **Trading Business**: Demand for medical equipment is expected to continue growing, with the Group planning to expand distribution channels and product lines, while also continuously promoting the application of A.I. video analysis technology through its associate companies in smart cities, financial institutions, and large airports[105](index=105&type=chunk)[107](index=107&type=chunk)[109](index=109&type=chunk) - **Hotel Operations**: Despite challenges of labor shortages and rising costs, Kaifeng City's cultural tourism potential offers stable prospects for the hotel business, and the Group will implement strict cost controls and innovative operations to maintain competitive advantages[111](index=111&type=chunk) [Corporate Governance & Other Information](index=41&type=section&id=Corporate%20Governance%20%26%20Other%20Information) [Human Resources](index=41&type=section&id=Human%20Resources) As of March 31, 2025, the Group employed 159 staff, with total employee benefit expenses of approximately HKD 37.40 million, a slight increase primarily due to new hotel operations, and implements discretionary bonuses and share option schemes to incentivize employees Human Resources Overview | Metric | March 31, 2025 | | :--- | :--- | | Total Employees | 159 | | - China | 116 | | - Hong Kong | 43 | | Total Employee Benefit Expenses (Annual) | Approx. HKD 37.40 million | [Corporate Governance](index=44&type=section&id=Corporate%20Governance) The Board believes the company largely complied with the Corporate Governance Code during the reporting period, with the only deviation being Mr. Tse Man Shing holding both Chairman and Managing Director roles, an arrangement the Board deems effective for strategy execution and balanced by the Board's structure - The company deviated from Corporate Governance Code provision C.2.1, which states that the roles of Chairman and Chief Executive should be separate, as Mr. Tse Man Shing concurrently holds both positions[130](index=130&type=chunk) - The Board believes the current arrangement facilitates effective implementation and execution of the Group's business strategies and ensures consistency in leadership[130](index=130&type=chunk) - The company has adopted a standard code for directors' securities transactions, and all directors have confirmed compliance[131](index=131&type=chunk) [Audit Committee](index=45&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors, is responsible for reviewing and monitoring the Group's internal controls, risk management, and financial reporting, and has reviewed this year's results - The Audit Committee comprises three independent non-executive directors: Dr. Ho Chung Tai, Mr. Siu Kam Chau, and Mr. Song Xiao Zhuang, with Mr. Siu Kam Chau serving as Chairman[134](index=134&type=chunk) - The financial figures in this preliminary results announcement have been reconciled with the draft consolidated financial statements by the company's auditor, BDO Limited[133](index=133&type=chunk)

Group 1 - The core point of the article highlights the financial performance and stock market activity of ST Ruihe, indicating a significant decline in revenue and profit for the first quarter of 2025 [1] - As of June 5, 2025, ST Ruihe's stock closed at 3.67 yuan, down 4.18%, with a turnover rate of 10.71% and a trading volume of 337,900 hands, amounting to 126 million yuan [1] - The company's latest quarterly report shows total revenue of 111 million yuan, a year-on-year decrease of 50.14%, and a net profit attributable to shareholders of 20.09 million yuan, down 14.02% year-on-year [1] Group 2 - The company has a current liquidity ratio of 0.815 and a quick ratio of 0.804, indicating potential liquidity challenges [1] - The asset-liability ratio stands at 93.14%, suggesting a high level of debt relative to assets [1] - ST Ruihe has made investments in 19 companies and participated in 2,004 bidding projects, showcasing its active engagement in the construction and decoration industry [2]

Share Issuance Plan - The total number of new shares that may be issued upon the exercise of options under the new plan is 146,682,060 shares, which does not exceed 10% of the total shares of the company as of the adoption date of the new plan [4]. - As of March 31, 2024, the number of options available for grant under the new plan is 146,682,060 options, remaining consistent with the previous figure [4]. - The total number of new shares available for issuance under the new plan as of June 27, 2024, is 146,682,060 shares, representing approximately 10% of the issued share capital [4].

Core Viewpoint - ST Ruihe (002620) reported a closing price of 4.33 yuan on May 14, 2025, with an increase of 3.84% and a turnover rate of 18.44% [1] Trading Information Summary - On May 14, 2025, the net outflow of main funds for ST Ruihe was 431.44 million yuan, accounting for 1.8% of the total transaction amount [2][3] - Retail investors had a net inflow of 80.58 million yuan, representing 0.34% of the total transaction amount [2] Company Announcement Summary - ST Ruihe disclosed a cumulative litigation and arbitration situation, reporting a total of 10 cases involving approximately 12.76 million yuan over the past twelve months [2][3] - The total amount involved in these cases exceeds 10% of the company's most recent audited net assets [2][3] - There are no significant litigation or arbitration matters exceeding 10% of the company's most recent audited net assets or involving amounts over 10 million yuan [2]

Group 1 - ST Ruihe (002620) closed at 3.53 yuan on April 30, 2025, with a 5.06% increase and a turnover rate of 19.84%, totaling a trading volume of 625,600 hands and a transaction amount of 220 million yuan [1] - The net inflow of main funds was 26.71 million yuan, accounting for 12.13% of the transaction amount, with large orders showing a net inflow of 35.90 million yuan, while small orders had a net outflow of 32.27 million yuan [1] - The latest quarterly report shows total operating revenue of 111 million yuan, a year-on-year decrease of 50.14%, and a net profit attributable to shareholders of 20.09 million yuan, down 14.02% year-on-year [1] Group 2 - Shenzhen Ruihe Construction Decoration Co., Ltd. was established in 1992 and is primarily engaged in construction decoration and renovation [2] - The company has made investments in 19 enterprises and participated in 1,991 bidding projects, holding 69 trademark registrations and 335 patents [2] - The company has 34 administrative licenses [2]

Financial Performance - Revenue for the six months ended September 30, 2024, was HKD 91,978,000, compared to HKD 33,887,000 for the same period in 2023, representing a significant increase of 171%[2] - Gross profit for the period was HKD 30,717,000, up from HKD 20,636,000 in the previous year, indicating a growth of 48%[2] - The company reported a loss before tax of HKD 10,168,000, compared to a profit of HKD 9,771,000 in the same period last year[2] - Total comprehensive income for the period was HKD 15,264,000, a recovery from a loss of HKD 70,813,000 in the previous year[5] - The adjusted profit before tax for the group was a loss of HKD 10,168,000, compared to a loss of HKD 7,374,000 in the previous year, indicating a decline in profitability[36] - The group reported a net loss attributable to shareholders of approximately HKD 14,622,000, reduced from HKD 16,807,000 in the previous period, due to increased revenue across all segments[117] Assets and Liabilities - The company’s non-current assets increased to HKD 1,237,588,000 from HKD 1,125,138,000, reflecting a growth of 10%[9] - Current liabilities decreased to HKD 429,492,000 from HKD 475,128,000, showing a reduction of 10%[12] - The net asset value of the company increased to HKD 1,356,893,000 from HKD 1,341,590,000, a rise of 1%[12] - The group’s total liabilities decreased to HKD 1,406,896,000 as of September 30, 2024, from HKD 1,467,251,000 as of March 31, 2024, indicating a reduction of approximately 4.13%[21] - The group maintains a healthy liquidity position, with total liabilities of approximately HKD 631,141,000, equity of approximately HKD 1,368,352,000, and non-controlling interests of approximately HKD 11,459,000[128] Cash Flow - Operating cash flow before tax showed a loss of HKD 10,168,000 for the six months ended September 30, 2024, compared to a profit of HKD 9,771,000 for the same period in 2023[21] - The net cash flow from operating activities was HKD 79,271,000 for the six months ended September 30, 2024, a significant improvement from a net outflow of HKD 1,114,000 in the previous year[21] - Cash and cash equivalents decreased by HKD 5,432,000 during the six months ended September 30, 2024, compared to an increase of HKD 11,697,000 in the same period of 2023[25] Revenue Breakdown - Revenue from property development and investment business was HKD 73,406,000, while trade business generated HKD 23,263,000, and other operations contributed HKD 8,038,000[36] - The company reported a significant increase in sales to external customers in Hong Kong, rising to HKD 21,585,000 from HKD 11,398,000 year-on-year, which is an increase of approximately 89%[39] - Revenue from property development and investment was approximately HKD 60,786,000, up about 387% from HKD 12,481,000 in the previous year, primarily driven by property sales in China[107] - Property sales revenue surged from approximately HKD 4,249,000 to about HKD 49,520,000, marking an increase of approximately 1,065% due to the launch of the Century Garden G District in Kaifeng, China[108] Expenses and Financial Management - The company recorded other income of HKD 12,907,000, down from HKD 39,257,000 in the previous year, a decline of 67%[2] - The company’s financial expenses rose to HKD 12,752,000 from HKD 11,402,000, an increase of 11%[2] - Tax expenses for the period totaled HKD 4,459,000, a decrease from HKD 26,584,000 in the previous year[62] - The total financial expenses for the group were HKD 12,752,000, down from HKD 14,042,000 in the previous year[58] Investments and Capital Expenditures - Capital expenditure for the period was HKD 49,476,000, primarily related to the acquisition of property, plant, and equipment, including the rights to operate a new hotel[36] - The total value of investment properties on the balance sheet was HKD 680,294,000, an increase from HKD 661,908,000 as of March 31, 2024, reflecting a net fair value adjustment loss of HKD 32,364,000[67] - The group has capital commitments of approximately HKD 434,000 as of the reporting period end[131] Shareholder Information - The average number of ordinary shares in issue for calculating basic loss per share remained at 1,466,820,600 shares for both years[66] - The company has issued 1,466,820,600 shares of common stock with a par value of HKD 0.10, representing a total paid-up capital of HKD 146,682,000[83] - The largest shareholder, Mr. Xie, holds a total of 653,904,900 shares, representing 44.58% of the company's issued share capital[170] Future Outlook and Strategy - The group is optimistic about the medium to long-term prospects of the real estate market in mainland China, supported by government policies aimed at stimulating the economy and the property market[137] - The company plans to continue expanding its market presence, particularly in mainland China, where sales reached HKD 70,393,000 for the period[39] - The company’s board aims to enhance risk control and asset management capabilities while seeking new breakthroughs in industry and geographical coverage[157]

Financial Performance - For the six months ended September 30, 2024, the company reported revenue of HKD 91,978,000, a significant increase from HKD 33,887,000 in the same period last year, representing a growth of 171%[2] - The gross profit for the same period was HKD 30,717,000, compared to HKD 20,636,000 in the previous year, indicating a year-over-year increase of 48%[2] - The company recorded a loss before tax of HKD 10,168,000, a decline from a profit of HKD 9,771,000 in the prior year, reflecting a negative swing of 204%[2] - The net loss for the period was HKD 14,627,000, slightly improved from a loss of HKD 16,813,000 in the previous year, showing a reduction of 13%[2] - Total revenue for the six months ended September 30, 2024, was HKD 104,707,000, a significant increase from HKD 39,310,000 in the same period last year, representing a growth of approximately 167%[39] - The group reported a loss before tax for the six months ended September 30, 2024, was HKD 14,622,000, compared to a loss of HKD 16,807,000 for the same period in 2023, indicating a reduction in losses[62] Assets and Liabilities - Total assets as of September 30, 2024, amounted to HKD 1,558,542,000, an increase from HKD 1,503,656,000 as of March 31, 2024[18] - The company's cash and cash equivalents decreased to HKD 33,340,000 from HKD 42,338,000, representing a decline of 21%[18] - The total equity attributable to the company's owners was HKD 1,368,352,000, up from HKD 1,353,075,000, reflecting a growth of 1%[20] - The company's total liabilities decreased to HKD 201,649,000 from HKD 162,066,000, indicating a rise of 24%[21] - As of September 30, 2024, the total equity attributable to the owners of the company was 1,356,893,000 HKD, a decrease from 1,341,590,000 HKD as of April 1, 2024[23] Revenue Segments - Revenue from property development and investment business reached HKD 49,520,000, compared to HKD 4,249,000 in the previous year, indicating a substantial increase of about 1,065%[43] - The total rental income from investment properties was HKD 11,266,000, compared to HKD 8,232,000 in the previous year, marking an increase of about 37%[50] - The total revenue from the trading business was HKD 23,154,000, compared to HKD 14,007,000 in the previous year, representing a growth of approximately 65%[43] - Revenue from the sale of medical equipment and health products rose from approximately HKD 11,108,000 to about HKD 21,411,000, a significant increase of approximately 93% due to a major sales order from the Hong Kong Hospital Authority[109] Expenses and Losses - The company’s administrative expenses increased to HKD 38,300,000 from HKD 36,019,000, marking an increase of 6%[2] - The total tax expense for the period was HKD 4,459,000, significantly lower than HKD 26,584,000 in the previous year, reflecting the absence of taxable profits in Hong Kong and the utilization of tax losses[59] - The company reported a fair value loss of HKD 72,393,000 from equity investments, impacting overall profitability[39] - The total comprehensive loss for the period, including revaluation reserve adjustments, amounted to 70,830,000 HKD[25] Foreign Exchange and Gains - The company reported a significant foreign exchange gain of HKD 29,884,000 from the translation of overseas operations, compared to a loss of HKD 53,392,000 in the previous year[11] - The foreign exchange differences from overseas operations resulted in a gain of 29,892,000 HKD during the period[23] - The company recorded a net foreign exchange gain of HKD 2,004,000 in 2024, compared to a gain of HKD 1,113,000 in 2023, indicating improved currency management[63] Capital Expenditures and Investments - Capital expenditure for the current period was HKD 49,476,000, primarily related to the acquisition of property, plant, and equipment, including the operational rights of a new hotel[39] - The company has completed the sale of two subsidiaries for a total consideration of approximately HKD 427,778,000, with outstanding payments of HKD 316,667,000 to be settled in four installments[69] Corporate Governance and Compliance - The company has complied with most of the corporate governance code provisions, with a noted deviation regarding the roles of the chairman and CEO[166][167] - The audit committee reviewed the interim results for the six months ending September 30, 2024, and confirmed compliance with applicable accounting standards[172] - The interim financial report will be published on the Hong Kong Stock Exchange and the company's website, with all required information included[176] Future Outlook and Market Conditions - The economic outlook for 2024 in mainland China is expected to improve due to supportive government policies aimed at stabilizing growth and boosting the property market[134] - Recent government measures to stimulate the real estate market include lowering down payment ratios and adjusting interest rates for second homes, which are expected to alleviate financial pressure on property companies[136]

The Group has signed an agreement with InterContinental Hotels Group (Shanghai) Ltd.* (a member of IHG Hotels & Resort) to operate the hotel under the name of "Holiday Inn Express Kaifeng City Center". Holiday Inn Express is one of the world-famous selected service hotel brands. Holiday Inn Express Kaifeng was opened in January 2020. Each of the premises is a four-storey house located at Building No. 4, 1 Longting Lake • Xiyuan, Longting Area, Kaifeng City, Henan Province, the PRC. The Group intends to oper ...