(於百慕達註冊成立之有限公司) (incorporated in Bermuda with limited liability) (Stock Code 股份代號：00500) 2024 ANNUAL REPORT 年報 先豐服務集團有限公司 Frontier Services Group Limited Annual Report 2024 年 報 CONTENTS 目錄 | | | Page(s) | | --- | --- | --- | | | | 頁 | | Corporate information | 公司資料 | 2-4 | | Chairman's statement | 主席報告 | 5-7 | | Management discussion and analysis | 管理層討論及分析 | 8-19 | | Corporate governance report | 企業管治報告 | 20-35 | | Environmental, social and governance report | 環境、社會及管治報告 | 36-60 | | Biographical details of ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容 而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 FRONTIER SERVICES GROUP LIMITED 先豐服務集團有限公司 * （ 於 百 慕 達 註 冊 成 立 之 有 限 公 司 ） 網址：www.fsgroup.com www.irasia.com/listco/hk/frontier （股份代號：00500） 末期業績公告 截至二零二四年十二月三十一日止年度 | | | 二零二四年 | 二零二三年 | | --- | --- | --- | --- | | | 附註 | 千港元 | 千港元 | | 來自客戶合約之收入 | 3 | 753,555 | 812,918 | | 直接材料費用及工作開支 | | (257,150) | (214,119) | | 數據成本 | | (2,177) | (4,651) | | 僱員福利開支 | | (312,368) | (336,024) | | 分包費用 | | (74,296) | (1 ...

| --- | --- | --- | |------------------------------|-------|-------| | | | | | 2024 Interim Report 中期報告 | | | CONTENTS 目錄 Page(s) 頁 | --- | --- | |--------------------------------------------------------------|--------------------------| | | | | Corporate Information | 公司資料 | | Management Discussion and Analysis | 管理層討論與分析 | | Condensed Consolidated Interim Financial Statements | 簡明綜合中期財務報表 | | Condensed Consolidated Income Statement | 簡明綜合收益表 | | Condensed Consolidated Statement of Comprehensive Income | 簡 ...

Stock Options and Rewards - No stock options or rewards were granted under the stock plan during the year ended December 31, 2023 [2] - Participants must pay HKD 1 within 28 days after the grant date to accept stock options [2] Profit Guarantee and Board Opinion - The Board did not express an opinion on the profit guarantee due to the failure to achieve the profit guarantee obligations under the acquisition agreement of De Wei Group [3]

Financial Performance - Revenue from customer contracts for the six months ended June 30, 2024, was HKD 384,121,000, a decrease of 10.5% compared to HKD 429,140,000 for the same period in 2023[2] - Operating profit for the period was HKD 24,689,000, down 66.1% from HKD 72,677,000 in the previous year[2] - Net profit for the period was HKD 5,313,000, a significant decline of 90.3% compared to HKD 54,869,000 in the same period last year[3] - The group reported a net profit of HKD 54,869,000 for the six months ended June 30, 2024, compared to HKD 62,814,000 in the previous year, indicating a decrease of approximately 12.5%[12] - The group’s profit for the six-month period ended June 30, 2024, was HKD 34,000, compared to HKD 50,743,000 for the same period in 2023, reflecting a significant decrease[18] Assets and Liabilities - Total assets as of June 30, 2024, amounted to HKD 1,024,336,000, down from HKD 1,056,457,000 at the end of 2023[4] - Current liabilities decreased to HKD 490,752,000 from HKD 519,906,000 at the end of 2023, indicating improved liquidity management[5] - Total assets as of June 30, 2024, amounted to HKD 1,024,336,000, with total liabilities of HKD 526,419,000, resulting in a net asset position[10] - The fair value of convertible bonds as of June 30, 2024, was HKD 219,070,000, an increase from HKD 209,049,000 as of December 31, 2023[25] - The capital debt ratio (total loans to total assets) was approximately 21.4% as of June 30, 2024, up from 19.8% as of December 31, 2023[42] Cash Flow and Expenses - Cash and cash equivalents increased slightly to HKD 201,847,000 from HKD 198,111,000 at the end of 2023, reflecting stable cash flow[4] - Employee benefits expenses decreased to HKD 166,547,000 from HKD 203,808,000, showing cost-cutting measures[2] - The group’s depreciation expense for the six months ended June 30, 2024, was HKD 12,213,000, compared to HKD 11,773,000 in the same period of 2023, reflecting an increase of approximately 3.7%[12] - Interest expenses for the six months ended June 30, 2024, totaled HKD 10,264,000, slightly higher than HKD 10,120,000 in the previous year, indicating a year-over-year increase of about 1.4%[13] Business Segments - Operating profit for the security, insurance, and infrastructure business was HKD 49,344,000, while the aviation and logistics business reported an operating profit of HKD 2,950,000, contributing to a total operating profit of HKD 24,689,000 for the group[10] - The security, insurance, and infrastructure business generated total revenue of HKD 250,200,000 for the period, accounting for about 65% of the group’s total revenue[31] - The aviation segment's revenue increased by HKD 56,524,000 to HKD 103,863,000, with net profit rising from HKD 3,744,000 to HKD 15,115,000, attributed to improved aircraft utilization[34] - The logistics segment's revenue from Shanghai Logistics increased approximately 19% to HKD 60,528,000, while maintaining a loss of HKD 1,401,000[36] - The healthcare segment generated total revenue of HKD 6,144,000, down from HKD 10,022,000, resulting in a net loss of HKD 118,000, as cross-border operations and online medical applications underperformed[37] Acquisitions and Investments - The acquisition of DeWe Group involved a cash payment of HKD 200,000,000 and potential share issuance based on profit targets, with 58,567,221 shares issued during the first relevant period[23] - The first target profit for DeWe Group was HKD 50,000,000, but the reported profit was HKD 38,069,000, leading to no shares issued for the second relevant period due to unmet minimum profit targets[23] - The fair value of the contingent consideration for the acquisition was estimated at HKD 135,055,000, based on expected profit scenarios[23] - The group has been actively seeking new investment opportunities to expand its revenue base and improve profitability[47] Legal Matters - The group is involved in a legal dispute with Aircraft Engine Leasing Finance Inc., with claims totaling approximately $5,800,000 (around HKD 45,500,000) related to a purchase agreement and repayment agreement[48] - The group has filed a claim exceeding €10,000,000 (approximately HKD 83,300,000) against the claimant for breach of contract and other legal responsibilities[49] - Shanghai Logistics, a wholly-owned subsidiary, is facing a claim of RMB 28,700,000 (approximately HKD 31,800,000) while counterclaiming RMB 11,400,000 (approximately HKD 12,700,000) against the same customer[49] - The potential liability for Shanghai Logistics is estimated at RMB 1,440,000 (approximately HKD 1,600,000), significantly lower than the claim amount[50] Employee Information - As of June 30, 2024, the group employed a total of 2,386 employees, an increase from 1,998 employees as of June 30, 2023[57] - Employee benefit expenses for the six months ended June 30, 2024, amounted to HKD 166,547,000, compared to HKD 203,808,000 for the same period in 2023[57] Dividend and Shareholder Information - The company does not recommend any interim dividend for the six-month period ended June 30, 2024, consistent with the previous year[19] - The average number of ordinary shares issued during the six-month period ended June 30, 2024, was 2,403,385,881, an increase from 2,369,918,898 in the previous year[18] - The net asset value per share (excluding non-controlling interests) was approximately HKD 0.16 as of June 30, 2024, consistent with the value as of December 31, 2023[42] Financial Reporting and Compliance - The group expects that the recent amendments to the Hong Kong Financial Reporting Standards will not have a significant impact on its financial statements[8] - The group anticipates that the new accounting standards effective from January 1, 2024, will not materially affect its operations or financial reporting[7] - The audit committee, consisting of three independent non-executive directors, has reviewed the interim financial statements for the six months ended June 30, 2024[58] - The interim report will be published on the Hong Kong Stock Exchange and the company's website, containing all information required by the listing rules[60]

Financial Performance - Total assets as of 31 December 2023 were HK$1,056,457,000, a decrease from HK$1,091,440,000 in 2022[2] - Net asset value per share (excluding non-controlling interests) increased to HK$0.16 in 2023 from HK$0.15 in 2022[2] - Available cash and bank balances were HK$198,111,000 in 2023, up from HK$186,790,000 in 2022[2] - Total borrowings increased to HK$209,049,000 in 2023 from HK$190,084,000 in 2022[2] - Gearing ratio rose to 19.8% in 2023 from 17.5% in 2022[2] - Consolidated revenue for 2023 decreased by 16% to HK$812,918,000 compared to HK$964,246,000 in 2022, primarily due to a significant decline in the logistics segment[46] - Operating profit improved significantly to HK$76,318,000 in 2023 from HK$4,210,000 in 2022, reflecting better operational performance[41] - Security, infrastructure, and insurance business grew to HK$572,533,000 in 2023, up from HK$527,518,000 in 2022, becoming the core revenue driver[46][49] - Aviation and logistics business revenue dropped sharply to HK$200,299,000 in 2023 from HK$371,316,000 in 2022, impacting overall revenue[46] - Cash and cash balances increased by HK$11,321,000 to HK$198,111,000 in 2023, driven by net cash generated from operating activities of HK$51,218,000[70] - Total assets decreased slightly to HK$1,056,457,000 in 2023 from HK$1,091,440,000 in 2022, while shareholders' funds increased to HK$382,922,000[43] - The Group achieved a net profit of HK$53,488,000 in 2023, a significant turnaround from a net loss of HK$26,250,000 in 2022[41] - Basic earnings per share improved to 2.14 cents in 2023 compared to a loss of 1.24 cents per share in 2022[43] - The company turned a loss of HK$26,250,000 in 2022 into a profit of HK$53,488,000 in 2023, primarily due to improved performance in the security, infrastructure, and aviation sectors[74][99] - The security segment's revenue increased by 21% from HK$423,657,000 in 2022 to HK$515,503,000 in 2023, contributing approximately 63% of the company's total revenue[76][102] - The infrastructure segment recognized a total revenue of HK$55,840,000 in 2023, down from HK$103,761,000 in 2022, with a profit of HK$8,467,000[80] - The aviation and logistics segment reported a decrease in revenue by approximately HK$171,017,000, but still managed to achieve an operating profit of HK$47,297,000[84][106] - The company's consolidated revenue for 2023 was HK$812,918,000, a 16% decrease from HK$964,246,000 in 2022, primarily due to a significant reduction in logistics business revenue[98] - Kenyan aviation arm's profit decreased from HK$12,788,000 in 2022 to HK$9,653,000 in 2023, a decline of 24.5%, due to reduced demand for air ambulance services and termination of a major customer contract[107] - The insurance segment recorded a profit of HK$4,209,000 in 2023, up 39.7% from HK$3,012,000 in 2022[108] - Infrastructure segment revenue in Laos decreased from HK$103,761,000 in 2022 to HK$55,840,000 in 2023, a 46.2% decline, with profit dropping from HK$14,476,000 to HK$8,467,000[108] - The security sector segment reported revenue of HK$200,299,000 and operating profit of HK$47,297,000 in 2023, compared to HK$371,316,000 revenue and HK$51,858,000 operating loss in 2022[128] - The healthcare segment generated total revenue of HK$18,628,000 in 2023, a significant decrease from HK$42,831,000 in 2022, and recorded an operating loss of HK$28,304,000 compared to an operating profit of HK$7,511,000 in 2022[131] Business Segments and Operations - The logistics sector, represented by Shanghai Logistics Company, achieved notable business improvement in 2023 through regional cooperation and targeted logistics services, enhancing customer retention[21][26] - The Group's infrastructure sector had a highlight moment in 2023, with key projects successfully completed and handed over, contributing to stable revenue[30][33] - The Group strengthened the linkage among various business entities, forming a resource and information platform at the Group level to share business needs and promote project expansion[30][33] - Frontier's aviation, insurance, and medical services all contributed stable revenue to the Group in 2023[30][33] - The Group's logistics sector engaged in regional cooperation with various countries, explored customer needs, and developed targeted logistics services, stabilizing and increasing revenue[21][26] - Frontier's brand has continuously enhanced its comprehensive influence locally, earning the trust and recognition of clients and establishing deep mutual trust in business cooperation[25][28] - The logistics segment's revenue decreased due to repositioning towards specific customers, but the segment operated near breakeven[86][88] - The logistics subsidiary in South Africa was liquidated, resulting in a one-time non-cash gain of HK$52,860,000 from deconsolidation[112] - The security segment has become the Group's core business and primary revenue driver, with significant returns expected from global security initiatives in the foreseeable future[132] - The Group acquired two security arms in Hong Kong, strengthening its presence in the security sector and targeting more prominent and lucrative security projects[132] - Globalmedicare Limited (GMC) adjusted its strategies in Q4 2023 to introduce potential new income streams, with management optimistic about a performance rebound in 2024[132] - The aviation division plans to enhance its fleet capabilities and expand services to include a wider range of air charter and air ambulance services in 2024[133][135] - The Group's logistics base in South Africa was placed into liquidation on January 23, 2023, resulting in a one-time non-cash gain of HK$52,860,000 due to the deconsolidation of the subsidiary[129] - Flying hours increased from 1,936 hours in 2022 to 2,090 hours in 2023, a 7.9% increase, driven by higher demand for chartered flights[107] Corporate Governance and Risk Management - The Group continues to optimize corporate governance and employee care, aiming to build a service-oriented enterprise and provide a larger stage for employees to realize their value[36][38] - Frontier has continuously strengthened group control, solidified management responsibilities, and streamlined processes, forming an efficient management system[31][33] - The Group's business planning and risk control are equally prioritized, with a well-rounded system and comprehensive assessments paving the way for subsequent business implementations[31][33] - Frontier actively supports and cooperates with foreign institutions and business chambers, providing compliant, safe, and professional security services for international investors, including Chinese enterprises[25][28] - The Group plans to transform from traditional business to comprehensive risk management services in 2024, leveraging multi-sector synergies[61] - Cost reduction and efficiency enhancement measures contributed to improved business resilience and operational performance[55] - The Group did not use any financial instruments for hedging due to prohibitive costs, but is closely monitoring currency exchange risks for KES, NN, and RMB[141] - The Group operates in Africa, South East Asia, and Mainland China, with transactions primarily denominated in USD, KES, NN, and RMB[141] - No significant investments or material acquisitions were made during the year, except for the deconsolidation of a subsidiary[141] - The Group maintains at least 25% public float as required under the Listing Rules[149] - The consolidated financial statements were audited by PricewaterhouseCoopers, who are eligible for re-appointment[149] - The Group was added to the US Department of Commerce's Entity List on 12 June 2023, but the Board denied any involvement in the alleged activities[158] - The Group hired a professional legal advisor to address the Entity List issue by 31 December 2023[160] - The Board's key responsibilities include formulating the Group's overall strategies, setting management targets, and regulating internal controls[164] - The Nomination Committee reviews the Board's diversity policy, considering factors such as gender, age, cultural background, and professional experience[173] - The Remuneration Committee determines the remuneration packages of Directors and senior management, and reviews the Group's remuneration policy[174][189] - The Risk Committee oversees the Group's risk appetite, risk principles, and risk-related issues, including corporate actions and sanction risks management[176] - The Group's performance analysis by operating segments is detailed in Note 5 of the consolidated financial statements[179] - The Group's annual performance for the year ended 31 December 2023 is presented in the consolidated income statement on page 98[180] - The Nomination Committee identifies potential directors based on qualifications, skills, and experience that contribute positively to the Board's performance[185] - The Remuneration Committee assists in attracting, retaining, and motivating high-caliber individuals to execute strategies across the Group's operations[187] - The Risk Committee comprises 3 independent non-executive directors, responsible for overseeing the Group's risk exposures and future risk strategy[190] - Shareholders can propose candidates for Director election by submitting a written notice with the candidate's information and consent for data publication[193] - The company adheres to the Model Code for Securities Transactions by Directors of Listed Issuers to oversee directors' securities transactions, with all directors confirming compliance for the year ended 31 December 2023[197] - The company will regularly review and reassess its policy to ensure smooth implementation, considering regulatory requirements, corporate governance practices, and shareholder expectations[196] - The Nomination Committee prioritizes candidates with significant business experience, public board experience, diversity, high ethical standing, and sufficient time commitment for board duties[195] - For independent non-executive directors, candidates must meet all independence requirements under Rule 3.13 of the Listing Rules and avoid conflicts of interest[195] Impairments and Non-Cash Items - Total impairment provisions for goodwill and other intangibles, interests in associates, financial and contract assets amounted to HK$65,489,000 in 2023, up from HK$38,750,000 in 2022[74][99] - The company recorded two non-cash gains in 2023: HK$52,860,000 from deconsolidation of a subsidiary and HK$40,745,000 from a decrease in fair value of contingent consideration payable[74][99] - Impairment provisions for the healthcare segment's goodwill amounted to HK$21,054,000 in 2023, with additional impairment provisions for financial and contract assets totaling HK$23,288,000[131] - Impairment provisions for non-current assets and financial assets of the South African subsidiary totaled HK$15,477,000 (HK$1,238,000 + HK$14,239,000)[114] Employee and Shareholder Information - The Group's total number of employees decreased to 1,939 in 2023 from 2,102 in 2022[4] - Total employees decreased from 2,102 in 2022 to 1,939 in 2023, a reduction of 7.8%[124] - The company did not grant any share options in 2023, compared to 23,400,000 share options granted in 2022[119] - A new share scheme was adopted on 28 June 2023, replacing the previous Share Option Scheme and Share Award Scheme[121] - No share options or share awards were granted under the new Share Scheme as of December 31, 2023, and up to the approval date of the consolidated financial statements[139] Currency and Exchange Rate Risks - The exchange rates of KES and NN against HK$ decreased by 21% and 50%, respectively, during the year ended 31 December 2023[141]

承董事會命 Frontier Services Group Limited 先豐服務集團有限公司* 公司秘書 陳錦坤 香港，二零二四年三月二十八日 於本公告日期，本公司董事會包括非執行董事為常振明先生（主席）、費怡平先生、陳啓 剛先生、Dorian Barak先生及張玉寬先生；執行董事為高振順先生（副主席）、羅寧先生 （副主席）及李曉鵬先生（行政總裁）；而獨立非執行董事為葉發旋先生、許興利先生、崔 利國先生及陳詠梅博士。 *僅供識別 香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容 而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 FRONTIER SERVICES GROUP LIMITED * 00500 二零二三年末期業績公告 補充資料 本公告乃由先豐服務集團有限公司作出，為於二零二四年三月二十七日刊發的截至二零 二三年十二月三十一日止年度之末期業績公告（「該公告」）提供補充資料。除另有定義 外，本公告所用詞彙與該公告所界定者具有相同涵義。 董事會不建議派付截至二零二三年十二月三十一日止年度之任 ...

(i) 本集團與Aircraft Engine Leasing Finance Inc.（「申索人」）於二零二零年十二月 十五日訂立購股協議（「購買協議」），據此，申索人收購由本公司全資附屬公 司Frontier Services Limited持有在Maleth Aero Limited及其附屬公司（「Maleth」） （本集團前附屬公司）的全部股權。同日，本集團與申索人訂立償還協議（「償 還協議」），對本集團在簽訂購買協議前若干年間向Maleth墊付的若干款項的償 還進行規定。截至本公告日期，Maleth並沒有根據償還協議償還若干欠款。 本集團認為索償要求並不屬實、毫無根據且╱或無法成立；無需向申索人支付 任何款項；提出索償要求是為了避免支付償還協議項下結欠本集團的款項。申 索人拒絕承擔註銷屬於本集團擁有的飛機的責任，以使本集團沒法取回有關飛 機的管有權。 馬耳他仲裁中心於二零二三年一月三十一日舉行了第一場聆訊，會上雙方當事 人及馬耳他仲裁中心曾討論行政管理及日程安排事宜。於二零二三年十二月 三十一日，尚未得出任何結論。 (ii) 於本年度，據了解先豐物流（上海）有限公司（「上海物流」），一間本公司間接 ...

54 Frontier Services Group Limited 先豐服務集團有限公司 average Options granted during before dates of the period 於二零二三年 尚未行使 之購股權 SHARE OPTIONS AND SHARE AWARD (continued) ERVICES GROU | --- | --- | --- | --- | |-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不負責， 對其準確性或完整性亦無發表聲明，並表明不會就因本公告全部或任何部份內容而 產生或因倚賴該等內容而引致之任何損失承擔任何責任。 FRONTIER SERVICES GROUP LIMITED 先豐服務集團有限公司 * （於百慕達註冊成立之有限公司） 網址： www.fsgroup.com www.irasia.com/listco/hk/frontier （股份代號：00500） 中期業績 截至二零二三年六月三十日止六個月期間 Frontier Services Group Limited先豐服務集團有限公司*（「本公司」）董事會（「董事 會」）提呈本公司及其附屬公司（統稱「本集團」）截至二零二三年六月三十日止六個 月期間（「本期間」）之未經審核綜合財務業績及財務狀況，連同二零二二年同期比較 金額。該等未經審核簡明中期財務報表已經本公司審核委員會成員審閱。 ...