Revenue and Profitability - Revenue for the six months ended December 31, 2023, was HKD 70,311,000, a decrease of 6.6% from HKD 74,788,000 in the same period of 2022[3] - Gross profit for the period was HKD 51,490,000, down from HKD 56,126,000, reflecting a decline of 8.8%[3] - The company reported a loss before tax of HKD 68,680,000, significantly improved from a loss of HKD 509,147,000 in the prior year, indicating a reduction of 86.5%[4] - The net loss for the period was HKD 38,290,000, compared to a net loss of HKD 391,151,000 in the same period last year, representing a decrease of 90.2%[4] - The property operations segment reported a loss of HKD 38,290,000 for the six months ended December 31, 2023, compared to a loss of HKD 391,151,000 for the same period in 2022, indicating a significant improvement in performance[20][30] - The group incurred a loss of approximately HKD 38,290,000 during the period, significantly reduced from HKD 391,151,000 in 2022, with a loss rate of about 54.5% compared to 523.0% in the previous year[48] Assets and Liabilities - Total assets less current liabilities amounted to HKD 1,002,215,000 as of December 31, 2023, down from HKD 1,052,451,000 as of June 30, 2023[6] - As of December 31, 2023, the group's net current liabilities were approximately HKD 93,257,000, down from HKD 117,001,000 as of June 30, 2023[63] - The total assets minus current liabilities amounted to approximately HKD 1,002,215,000, a decrease from HKD 1,052,451,000 as of June 30, 2023[63] - Total equity as of December 31, 2023, was approximately HKD 221,751,000, down from HKD 268,442,000 as of June 30, 2023[63] Cash Flow and Financial Stability - The company’s cash and cash equivalents increased to HKD 54,747,000 from HKD 33,152,000, reflecting a growth of 64.5%[6] - The group has maintained reasonable operating capital despite the ongoing COVID-19 pandemic, ensuring financial stability[64] - The board believes that existing financial resources will be sufficient to support future expansion plans[66] Revenue Sources and Performance - Property rental income for the period was HKD 30,089,000, slightly down from HKD 30,657,000, a decrease of 1.8%[14] - Property management fee income decreased to HKD 39,395,000 from HKD 43,441,000, a decline of 9.5%[14] - Revenue for the property operations segment for the six months ended December 31, 2023, was HKD 70,311,000, a decrease from HKD 74,788,000 for the same period in 2022, representing a decline of approximately 6.6%[20][21] - The total revenue from a single tenant accounted for 10% or more of the group's revenue, amounting to HKD 13,495,000 for the six months ended December 31, 2023, up from HKD 10,830,000 in the same period of 2022, reflecting a growth of approximately 24.5%[17] Expenses and Cost Management - Interest expenses for the six months ended December 31, 2023, were HKD 18,964,000, down from HKD 22,275,000 in the same period of 2022, representing a reduction of approximately 14%[22] - Administrative expenses were approximately HKD 11,380,000, accounting for 16.2% of revenue, a decrease from 17.5% in 2022, maintained at similar levels due to strict cost control policies[50] - Financial expenses were approximately HKD 18,964,000, accounting for 27.0% of revenue, down from 29.8% in 2022, mainly due to reduced interest expenses from lease liabilities[53] Future Outlook and Expansion Plans - The company expects to fulfill its financial obligations in the foreseeable future based on cash flow forecasts and available internal resources[9] - The group plans to expand property management operations to additional subsidiaries in China to develop potential new properties[35] - The group aims to maximize shareholder returns and market value through business diversification and expansion opportunities[62] - The reopening of China is expected to positively impact economic recovery, with anticipated increases in demand for goods and services, leading to gradual recovery in sales and foot traffic at shopping malls[60] Tenant Support and Market Conditions - The group provided support to over 235 tenants affected by the pandemic, resulting in a total reduction of approximately HKD 32,634,000 in rent and service fees[44] - The group aims to reduce costs as a key strategy to address business uncertainties arising from the pandemic[44] Impairment and Receivables - The impairment loss on trade receivables for the six months ended December 31, 2023, was HKD 393,000, compared to HKD 28,866,000 for the same period in 2022, indicating a significant decrease in impairment losses[20][21] - The total receivables as of December 31, 2023, amounted to HKD 48,572,000, an increase from HKD 30,538,000 as of June 30, 2023, indicating a growth of approximately 58.9%[33] - As of December 31, 2023, accounts receivable amounted to HKD 16,707,000, an increase from HKD 15,290,000 as of June 30, 2023, with overdue accounts over 90 days rising to HKD 12,950,000 from HKD 7,138,000[34] - The internal credit assessment indicates that there are no overdue or impaired accounts receivable, with a credit quality acceptance rate of 19% as of June 30, 2023, down from 32%[34] Investment Properties and Fair Value - The fair value of investment properties, including Jiachao Shopping Center and Shopping Center C, was approximately HKD 881,318,000, reflecting a fair value loss of HKD 134,783,000, significantly reduced from HKD 483,146,000 in 2022[52] - The group aims to enhance its property management team and may consider acquiring light-asset property operations in China to strengthen its operational capabilities[57]

Financial Performance - The company reported revenue of HKD 143,233,000 for the year, a decrease of 22.5% from HKD 184,601,000 in 2022[10] - The net loss for the year was HKD 683,448,000, compared to a loss of HKD 88,159,000 in the previous year, indicating a significant increase in losses[10] - For the fiscal year ending June 30, 2023, the gross profit margin was approximately 73.8%, down from 79.8% in 2022, primarily due to rental and service fee reductions for over 275 tenants affected by the pandemic, totaling approximately HKD 23,025,000[29] - Other income and losses amounted to approximately HKD 28,476,000 for the fiscal year ending June 30, 2023, a decrease from HKD 33,156,000 in 2022, mainly due to the expiration of receivable loans[32] - The impairment loss on rental deposits was approximately HKD 19,247,000 for the fiscal year ending June 30, 2023, attributed to certain banks seizing parts of stores, increasing credit risk[33] - The group reported a loss of approximately HKD 683,448,000 for the year ended June 30, 2023, with a loss rate of 477.2%, significantly higher than the previous year's loss of HKD 77,683,000 and a loss rate of 42.1%[53] - The fair value of investment properties, including Jiachao Shopping Center, decreased by approximately HKD 720,225,000 during the year, compared to a decrease of HKD 162,651,000 in the previous year[53] - The group recorded an impairment loss on receivables of approximately HKD 184,361,000, significantly up from HKD 51,551,000 in 2022, due to increased credit risk from overdue loans[86] - The fair value of investment properties decreased to approximately HKD 995,699,000 from HKD 1,843,529,000 in 2022, reflecting a loss of approximately HKD 720,225,000 due to slowing rental growth[88] - The net loss from fair value changes of investment properties, after deferred tax liabilities, was approximately HKD 540,169,000, compared to HKD 121,988,000 in 2022[88] - The total equity of the group as of June 30, 2023, was approximately HKD 268,442,000, a significant decrease from HKD 1,012,424,000 in the previous year[69] Property Operations - Approximately 99.0% of the leasable area at the Jiachao Shopping Center has been rented out, with around 134 tenants operating retail stores, restaurants, and entertainment facilities[11] - The C Zone Shopping Center has approximately 95.0% of its leasable area rented out to 106 tenants, providing various services and products[24] - The company plans to enhance property operations by leasing to more well-known brands and diversifying tenant types to meet customer needs[16] - The company aims to explore potential investment opportunities in property operations, driven by China's large population and strong consumer power[16] - The company plans to focus on property operations to enhance shareholder returns and explore future market opportunities[38] - The group aims to expand its tenant base and enhance the shopping experience through marketing and promotional activities to generate stable revenue and cash flow[64] - The group plans to continue focusing on property operations and management services, leveraging its existing team to minimize additional operational costs while maximizing rental income[51] - The group plans to invest approximately HKD 203,000 in property, plant, and equipment, a substantial decrease from HKD 3,981,000 in 2022, suggesting a shift in capital expenditure strategy[101] - The group aims to leverage growth opportunities in the property operation market, particularly in Zhengzhou, a regional economic center in China[95] Cost Management and Financial Stability - The company continues to implement prudent cost management policies to improve operational efficiency and maintain a stable financial position[17] - The management believes that the company will achieve more robust performance in the future through strict cost control and financial planning[14] - The company aims to maintain sustainable financial performance in property operations and is closely monitoring the effectiveness of its strategic initiatives[45] - The group continues to implement strict cost control measures to manage operational costs and capital expenditures effectively[94] - Administrative expenses were approximately HKD 21,766,000, accounting for 15.2% of total revenue for the year, compared to 12.8% in the previous year, reflecting strict cost control measures[55] - Financial expenses were approximately HKD 43,761,000, representing 30.6% of total revenue, consistent with the previous year's 25.8%[59] Governance and Compliance - The company has established an audit committee, a remuneration committee, and a nomination committee to oversee its operations[164] - The company has committed to best corporate governance practices, adhering to the principles outlined in the Corporate Governance Code[153] - The company has established strict written guidelines for employees regarding trading in securities to prevent violations of insider trading regulations[154] - The board believes that the governance mechanisms in place are effective[186] - The independent non-executive directors confirmed their independence, with each serving a term of one year[155] - The company is committed to maintaining effective communication with shareholders through various channels, including web announcements and annual general meetings[1] Employee and Shareholder Information - The group employs a total of 144 employees across China and Hong Kong, providing competitive compensation and benefits packages[126] - The company has a total of 597,280,000 shares held by Chairman Chen Jin Yan, representing 22.21% of the issued share capital[138] - The company has a total of 369,100,000 shares held by Ms. Lin Lin, representing 13.73% of the issued share capital[167] - Mr. Chen Jinqing holds 188,315,000 shares, accounting for 7.00% of the issued share capital[167] - Dresdner VPV N.V. holds 139,755,200 shares, which is 5.20% of the issued share capital[167] - The group reported that the sales from the top five customers accounted for 29% of total sales, down from 30% in the previous year, with the largest customer contributing approximately 17% of total sales[146] - The group’s procurement from the top five suppliers represented 37% of total procurement, slightly up from 36% in the previous year, with the largest supplier accounting for about 14% of total procurement[146] Future Outlook - The company expects stable business development in the future, with a cautious approach to developing existing projects and exploring new opportunities[46] - The board anticipates that the reopening of the economy will positively impact sales and foot traffic in shopping malls, leading to increased tenant confidence and eliminating the need for rent reductions[68] - The board believes existing financial resources will be sufficient for future expansion plans, with the potential to secure additional financing on favorable terms if necessary[98] - The company has not purchased, sold, or redeemed any of its listed securities during the fiscal year ending June 30, 2023[147] - The company has reached an agreement with borrowers on a revised repayment schedule for extended loans, with the final repayment date set for January 31, 2024[176] Audit and Financial Reporting - The company’s financial statements for the fiscal year ending June 30, 2023, were audited by Kaiyuan Xinde CPA[177] - The financial statements for the fiscal year ending June 30, 2023, were prepared in accordance with statutory requirements and applicable accounting standards, ensuring a true and fair view of the company's financial position and performance[1] - The Audit Committee held a total of seven meetings during the fiscal year ending June 30, 2023, with attendance recorded for all members[195] - The Board of Directors reviewed the effectiveness of the internal control system and found it to be effective and adequate, with no significant issues affecting shareholders identified[197] - The Audit Committee assessed the risk environment and internal control procedures, concluding that the current internal control and risk management systems are effective and sufficient[196] - The company has no significant uncertainties that would cast doubt on its ability to continue as a going concern[1]

[Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=1&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) [Continuing Operations](index=1&type=section&id=Continuing%20Operations) For the year ended June 30, 2023, the company's continuing operations recorded a loss of HK$683,448 thousand, a significant increase from HK$77,683 thousand in the prior year, with total comprehensive expense for the year being HK$743,982 thousand, primarily due to exchange differences Summary of Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Loss Before Tax | (857,397) | (105,084) | | Income Tax Credit | 173,949 | 27,401 | | Loss for the Year from Continuing Operations | (683,448) | (77,683) | | Loss for the Year from Discontinued Operations | – | (10,476) | | Loss for the Year | (683,448) | (88,159) | | Total Comprehensive Expense for the Year | (743,982) | (117,127) | Loss Per Share (HK cents) | Metric | 2023 (HK cents) | 2022 (HK cents) | | :--- | :--- | :--- | | Basic and Diluted Loss from Continuing Operations | (25.42) | (3.21) | | Basic and Diluted Loss from Discontinued Operations | – | (0.38) | | Basic and Diluted Loss from Continuing and Discontinued Operations | (25.42) | (3.60) | [Consolidated Statement of Financial Position](index=4&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) [Asset and Liability Structure](index=4&type=section&id=Asset%20and%20Liability%20Structure) As of June 30, 2023, the company's total equity significantly decreased to HK$268,442 thousand, with net current liabilities of HK$117,001 thousand, compared to net current assets in the prior year, and a notable reduction in investment property carrying value reflecting a subdued market Summary of Consolidated Statement of Financial Position | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Investment Properties | 995,699 | 1,843,529 | | **Current Assets** | | | | Trade and Other Receivables | 30,538 | 22,949 | | Loans Receivable | – | 213,709 | | Bank Balances and Cash | 33,152 | 21,526 | | **Current Liabilities** | | | | Lease Liabilities | 120,545 | 88,808 | | Amounts Due to a Major Shareholder | 192 | 47,496 | | **Total Equity** | 268,442 | 1,012,424 | | Net Current (Liabilities) / Assets | (117,001) | 50,381 | | Total Assets Less Current Liabilities | 1,052,451 | 2,089,655 | - The company generated **net current liabilities of HK$117,001 thousand** as of June 30, 2023, but the Board believes there will be sufficient operating cash inflows to cover operating outflows in the next 12 months, thus the consolidated financial statements are prepared on a going concern basis[65](index=65&type=chunk)[86](index=86&type=chunk) [Notes to the Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [1. General Information](index=6&type=section&id=1.%20General%20Information) The company is a public limited company incorporated in the Cayman Islands, primarily engaged in property operation businesses, with its direct and ultimate holding company being Shengduo Limited and the ultimate controlling party being Mr. Chen Jinyan - The Company is an investment holding company, and its subsidiaries are engaged in property operation businesses[82](index=82&type=chunk) - The Company's direct and ultimate holding company is Shengduo Limited, and the ultimate controlling party is Mr. Chen Jinyan[81](index=81&type=chunk) [2. Application of New and Revised Hong Kong Financial Reporting Standards](index=6&type=section&id=2.%20Application%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group has applied amendments to Hong Kong Financial Reporting Standards effective for the annual period beginning July 1, 2022, but these amendments are not expected to have a significant impact on financial position and performance - The Group has first applied the amendments to Hong Kong Financial Reporting Standards that are mandatorily effective for the annual period beginning on July 1, 2022[83](index=83&type=chunk) - The Directors anticipate that the application of all new and revised Hong Kong Financial Reporting Standards will not have a significant impact on the Group's financial position, performance, and disclosures in the foreseeable future[84](index=84&type=chunk) [3. Basis of Preparation of Consolidated Financial Statements and Principal Accounting Policies](index=7&type=section&id=3.%20Basis%20of%20Preparation%20of%20Consolidated%20Financial%20Statements%20and%20Principal%20Accounting%20Policies) The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards and measured at historical cost, except for investment properties measured at fair value, with the Board having reviewed cash flow forecasts and prepared the statements on a going concern basis - The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants[64](index=64&type=chunk) - The consolidated financial statements are prepared on a historical cost basis, except for certain investment properties which are measured at fair value at the end of each reporting period[66](index=66&type=chunk) - The Directors believe that the Group will be able to meet its financial obligations as they fall due in the foreseeable future, and therefore, the consolidated financial statements have been prepared on a going concern basis[86](index=86&type=chunk) [4. Revenue and Segment Information](index=9&type=section&id=4.%20Revenue%20and%20Segment%20Information) The Group's revenue primarily derives from property leasing and property management services, with total revenue of HK$143,233 thousand in 2023, a decrease from 2022, and property operation being the sole reportable segment whose performance is assessed by the chief operating decision maker Revenue Breakdown from Continuing Operations | Revenue Source | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Rental income from property leasing | 60,174 | 74,516 | | Property management fee income | 81,312 | 107,556 | | Property management – other related services | 1,747 | 2,529 | | **Total Revenue** | **143,233** | **184,601** | - The Group has only one single reportable segment in the People's Republic of China, which is the property operation segment[121](index=121&type=chunk) - A single tenant accounted for **10% or more of the Group's revenue** for the year ended June 30, 2023, with total revenue of **HK$24,781 thousand** (2022: HK$33,531 thousand)[71](index=71&type=chunk) [5. Other Income and Other Gains and Losses](index=13&type=section&id=5.%20Other%20Income%20and%20Other%20Gains%20and%20Losses) For the year ended June 30, 2023, other income and other gains and losses amounted to approximately HK$28,476 thousand, a decrease from the prior year, primarily due to reduced loan interest income as loans receivable matured Breakdown of Other Income and Other Gains and Losses | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Bank interest income | 57 | 572 | | Car park income | 7,159 | 6,653 | | Service income | 2,895 | 4,709 | | Exchange (loss) / gain | (1,724) | 1,187 | | Government grants | 99 | 176 | | Loan interest income | 13,964 | 20,923 | | Imputed interest income on lease deposits | 5,570 | 5,580 | | Others | 456 | 168 | | Loss on modification of loans receivable | – | (6,812) | | **Total** | **28,476** | **33,156** | - The decrease in other income and other gains and losses was primarily due to the maturity of loans receivable on April 27, 2023, whereas loan interest income was generated for the full year ended June 30, 2022[12](index=12&type=chunk) [6. Finance Costs](index=14&type=section&id=6.%20Finance%20Costs) For the year ended June 30, 2023, finance costs were approximately HK$43,761 thousand, a slight decrease from HK$47,711 thousand in the prior year, primarily comprising interest on lease liabilities Breakdown of Finance Costs | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Interest on secured bank borrowings | 19 | – | | Interest on bonds | 1,706 | 2,080 | | Interest on lease liabilities | 42,036 | 45,631 | | **Total** | **43,761** | **47,711** | [7. Income Tax Credit](index=14&type=section&id=7.%20Income%20Tax%20Credit) For the year ended June 30, 2023, the income tax credit was HK$173,949 thousand, primarily from deferred tax, with China corporate income tax levied at 25% and some subsidiaries enjoying a preferential tax rate of 5% Breakdown of Income Tax Credit | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Current income tax | 4,792 | 16,478 | | Underprovision / (overprovision) in prior years | 1,640 | (3,216) | | Deferred tax | (180,381) | (40,663) | | **Total** | **(173,949)** | **(27,401)** | - China corporate income tax is levied at **25% of profits**, and Zhengzhou Xufu Commercial Operation Management Co., Ltd., a subsidiary of the Company, is a small-profit enterprise eligible for a **preferential corporate income tax rate of 5%**[105](index=105&type=chunk) [8. Loss for the Year](index=15&type=section&id=8.%20Loss%20for%20the%20Year) The loss for the year was primarily impacted by losses from changes in fair value of investment properties, impairment losses on loans receivable, and impairment losses on lease deposits, with staff costs, depreciation, and auditor's remuneration also listed as expenses Key Factors Affecting Loss for the Year | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Loss from changes in fair value of investment properties | 720,225 | 162,651 | | Impairment loss on loans receivable | 184,361 | 51,551 | | Impairment loss on lease deposits | 19,247 | – | | Impairment loss on trade receivables | 2,225 | – | Breakdown of Key Expenses | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Staff costs | 20,635 | 22,579 | | Depreciation of property, plant and equipment | 196 | 115 | | Depreciation of right-of-use assets | 1,183 | 1,140 | | Auditor's remuneration | 1,200 | 1,300 | [9. Dividends](index=15&type=section&id=9.%20Dividends) The Board does not recommend the payment of any final dividend for the year ended June 30, 2023, consistent with the prior year - The Board does not recommend the payment of any final dividend for the year ended June 30, 2023 (2022: nil)[1](index=1&type=chunk) - For the year ended June 30, 2022, the Board declared and paid a special dividend of **HK$0.08 per share** to the Company's shareholders[153](index=153&type=chunk) [10. Loss Per Share](index=16&type=section&id=10.%20Loss%20Per%20Share) For the year ended June 30, 2023, basic and diluted loss per share was HK$25.42 cents, a significant increase from HK$3.60 cents in the prior year, primarily due to the increased loss attributable to owners of the Company Basic and Diluted Loss Per Share | Metric | 2023 (HK cents) | 2022 (HK cents) | | :--- | :--- | :--- | | From continuing operations | (25.42) | (3.21) | | From discontinued operations | – | (0.38) | | From continuing and discontinued operations | (25.42) | (3.60) | - The calculation of diluted loss per share did not assume the exercise of the Company's outstanding share options because their assumed exercise would result in a reduction in loss per share for both years[114](index=114&type=chunk) [11. Trade and Other Receivables](index=17&type=section&id=11.%20Trade%20and%20Other%20Receivables) As of June 30, 2023, total trade receivables amounted to HK$15,290 thousand, with an impairment loss provision of HK$2,129 thousand, and trade receivables over 90 days significantly increased Breakdown of Trade and Other Receivables | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Trade receivables | 15,290 | 11,036 | | Less: Provision for impairment loss | (2,129) | – | | Prepayments | 1,064 | 1,185 | | Other receivables | 16,313 | 10,728 | | **Total** | **30,538** | **22,949** | Ageing Analysis of Trade Receivables (Before Impairment) | Ageing | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 60 days | 4,938 | 7,196 | | 61 to 90 days | 3,214 | 1,449 | | Over 90 days | 7,138 | 2,391 | | **Total trade receivables** | **15,290** | **11,036** | [Operations and Financial Review](index=18&type=section&id=Operations%20and%20Financial%20Review) [Business Overview](index=18&type=section&id=Business%20Overview) The Group primarily engages in property operation businesses in China, managing and developing shopping centers through Zhongyuan Jinyi, Zhengzhou Jinfu, and Zhengzhou Xufu, with Zhongyuan Jinyi operating Jiaochao Shopping Center and Shopping Center Zone C, achieving occupancy rates of 99.0% and 95.0% respectively - The Group is principally engaged in property operation businesses in China through its wholly-owned interests in Zhongyuan Jinyi, Zhengzhou Jinfu, and Zhengzhou Xufu[118](index=118&type=chunk) - As of June 30, 2023, approximately **99.0% of the leasable area** of Jiaochao Shopping Center was leased to approximately **134 tenants**[173](index=173&type=chunk) - As of June 30, 2023, approximately **95.0% of the leasable area** of Shopping Center Zone C was leased to approximately **106 tenants**[7](index=7&type=chunk) [Impact of COVID-19 and Rent Concessions](index=20&type=section&id=Impact%20of%20COVID-19%20and%20Rent%20Concessions) The COVID-19 pandemic significantly impacted the Group's business, leading to shopping mall closures and pandemic controls; to support tenants, the Group provided rent, management, and operating service fee concessions totaling approximately HK$23,025 thousand to over 275 tenants in FY2023 - The Group's business was significantly impacted by shopping mall closures and pandemic control measures during the year[175](index=175&type=chunk) - The Group provided support to **over 275 tenants** by reducing their rent, management, and operating service fees on different bases, totaling approximately **HK$23,025 thousand** for the year ended June 30, 2023 (2022: HK$8,087 thousand)[175](index=175&type=chunk) [Financial Performance Analysis](index=21&type=section&id=Financial%20Performance%20Analysis) Financial performance significantly deteriorated this year, with revenue declining due to rent concessions and a corresponding decrease in gross profit margin; losses substantially increased, primarily driven by changes in fair value of investment properties and impairment losses on loans receivable, while discontinued operations no longer generated revenue or losses [Revenue](index=21&type=section&id=Revenue) For the year ended June 30, 2023, the Group's revenue was approximately HK$143,233 thousand, a decrease of about 22.4% from 2022, primarily attributed to rent, management, and operating service fee concessions provided to tenants affected by the pandemic Revenue Changes | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 143,233 | 184,601 | -22.4% | - The decrease in revenue for the year was attributed to rent, management, and operating service fee concessions provided to **over 275 tenants**, totaling approximately **HK$23,025 thousand** (2022: HK$8,087 thousand)[146](index=146&type=chunk) [Gross Profit](index=21&type=section&id=Gross%20Profit) The gross profit margin for the year was approximately 73.8%, a decrease from 79.8% in the prior year, primarily due to reduced revenue caused by rent concessions Gross Profit Margin Changes | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Gross Profit Margin | 73.8% | 79.8% | - The decrease in gross profit margin was due to reduced revenue resulting from rent, management, and operating service fee concessions provided to **over 275 tenants** of Jiaochao Shopping Center and Shopping Center Zone C, who were affected by the pandemic for the year ended June 30, 2023[177](index=177&type=chunk) [Loss for the Year](index=21&type=section&id=Loss%20for%20the%20Year) The Group incurred a loss of approximately HK$683,448 thousand for the year ended June 30, 2023, with a loss ratio of 477.2%, primarily attributable to a significant decrease in the fair value of investment properties and impairment losses on loans receivable Changes in Loss for the Year and Loss Ratio | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Loss | (683,448) | (77,683) | | Loss Ratio | 477.2% | 42.1% | - The significant increase in loss was primarily attributable to: (1) a substantial decrease in the fair value of investment properties of approximately **HK$720,225 thousand** (2022: HK$162,651 thousand); and (2) an impairment loss on loans receivable of approximately **HK$184,361 thousand** (2022: HK$51,551 thousand) due to default on the renewed loan[11](index=11&type=chunk) [Other Income and Other Gains and Losses](index=22&type=section&id=Other%20Income%20and%20Other%20Gains%20and%20Losses) For the year ended June 30, 2023, other income and other gains and losses amounted to approximately HK$28,476 thousand, a decrease from the prior year, primarily due to reduced loan interest income as loans receivable matured Changes in Other Income and Other Gains and Losses | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Other income and other gains and losses | 28,476 | 33,156 | - The decrease was primarily due to the maturity of loans receivable on April 27, 2023, whereas loan interest income was generated for the full year ended June 30, 2022[12](index=12&type=chunk) [Expenses](index=22&type=section&id=Expenses) Administrative expenses remained stable, but impairment losses on loans receivable significantly increased to HK$184,361 thousand, and lease deposits also incurred HK$19,247 thousand in impairment losses, mainly due to increased credit risk and the seizure of some shops Changes in Key Expenses | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Administrative expenses | 21,766 | 23,617 | | Impairment loss on loans receivable | 184,361 | 51,551 | | Impairment loss on lease deposits | 19,247 | – | - The significant increase in impairment loss on loans receivable was due to the renewed loan not being settled by its maturity date, leading to a substantial increase in credit risk[13](index=13&type=chunk) - The impairment loss on lease deposits was primarily due to certain banks and financial institutions seizing some shops, increasing credit risk[180](index=180&type=chunk) [Finance Costs](index=24&type=section&id=Finance%20Costs) For the year ended June 30, 2023, finance costs were approximately HK$43,761 thousand, representing about 30.6% of revenue, remaining largely stable compared to the prior year Changes in Finance Costs | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Finance costs | 43,761 | 47,711 | | Percentage of revenue | 30.6% | 25.8% | [Dividends](index=24&type=section&id=Dividends) The Board does not recommend the payment of a final dividend for the year ended June 30, 2023, consistent with the prior year - The Board does not recommend the payment of any final dividend for the year ended June 30, 2023 (2022: nil)[183](index=183&type=chunk) [Discontinued Operations](index=24&type=section&id=Discontinued%20Operations) Due to the disposal of the biotechnology segment in FY2022, discontinued operations generated no revenue or losses in FY2023, as the segment ceased operations after failing to obtain a production license - Due to the disposal of the biotechnology segment in the year ended June 30, 2022, discontinued operations generated no revenue or losses for the year ended June 30, 2023[154](index=154&type=chunk) - The segment had not commenced commercial production since its establishment in 2019 due to the failure to obtain a cannabidiol production license from Chinese regulatory authorities, leading the Board to decide to cease its operations[154](index=154&type=chunk)[174](index=174&type=chunk) [Future Plans and Prospects](index=24&type=section&id=Future%20Plans%20and%20Prospects) [Business Strategies and Development](index=24&type=section&id=Business%20Strategies%20and%20Development) The Group will continue to focus on and actively expand its property operation business by diversifying tenant types, upgrading shopping centers, launching marketing campaigns, and potentially acquiring asset-light property operation businesses to enhance flexibility, efficiency, and profitability - The Group aims to provide leasing, management, and operating services to more tenants in various shopping centers located in different regions[19](index=19&type=chunk) - The Group will expand its tenant types by providing leasing services to more renowned brands and continuously upgrade the tenants of its two shopping centers[19](index=19&type=chunk) - The Group will continue to allocate resources to its property operation business, including recruiting high-quality talent, developing shopping centers of similar scale, and potentially acquiring asset-light property operation businesses in China[186](index=186&type=chunk) - The Group continues to implement conservative and stringent cost control policies by managing operating costs and capital expenditures and strengthening accounts receivable management[20](index=20&type=chunk) [Market Outlook and Recovery](index=26&type=section&id=Market%20Outlook%20and%20Recovery) With the Chinese government easing pandemic controls and implementing economic stimulus policies, the economy is expected to gradually recover, leading to a rebound in household consumption, shopping mall sales, and foot traffic, and the Group anticipates no further need for rent concessions to tenants - The Chinese government began lifting lockdowns and easing control restrictions in early 2023, implementing a series of economic stimulus policies across various industries[157](index=157&type=chunk) - The Board believes that the reopening will bring positive impacts to the economic recovery in the coming year, with demand for goods and services recovering and prices accelerating, especially in household consumption[157](index=157&type=chunk) - Shopping mall sales and foot traffic are expected to gradually recover in the future, and this anticipated robust growth will also boost tenant confidence; consequently, the Group will no longer need to provide rent concessions to tenants in the future[157](index=157&type=chunk) [Liquidity and Financial Resources](index=26&type=section&id=Liquidity%20and%20Financial%20Resources) [Financial Position](index=26&type=section&id=Financial%20Position) As of June 30, 2023, the Group recorded net current liabilities of HK$117,001 thousand, with total equity significantly decreasing to HK$268,442 thousand, and the current ratio falling to 35.2%, though internal resources and major shareholder support are expected to cover commitments Summary of Liquidity and Financial Resources | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Net current liabilities | (117,001) | 50,381 (Net current assets) | | Total Equity | 268,442 | 1,012,424 | | Cash and bank deposits | 33,152 | 21,526 | | Current Ratio | 35.2% | 124.2% | - The Group anticipates that its business operations and financial support from a major shareholder of the Company will generate sufficient resources to meet short-term and long-term commitments[159](index=159&type=chunk) [Financing and Capital Structure](index=27&type=section&id=Financing%20and%20Capital%20Structure) As of June 30, 2023, the Group had no loan financing, with total bonds amounting to approximately HK$10,003 thousand and a total debt-to-equity ratio of approximately 3.7%, and the company's share capital is entirely composed of ordinary shares - As of June 30, 2023, the Group had no loan financing (2022: nil)[190](index=190&type=chunk) Bonds and Debt Ratio | Metric | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Total bonds | 10,003 | 25,344 | | Total debt ratio (bonds to shareholders' funds) | 3.7% | 2.5% | - As of June 30, 2023, the Company's share capital was entirely composed of ordinary shares[191](index=191&type=chunk) [Risk Management](index=27&type=section&id=Risk%20Management) The Group's primary transactions are denominated in RMB, thus it is not exposed to significant foreign exchange risk and does not use financial instruments for hedging; the Board monitors interest rate risk and considers hedging policies when necessary - For the year ended June 30, 2023, the Group was not exposed to any significant foreign exchange risk as most of its transactions were denominated in RMB[25](index=25&type=chunk) - The Board monitors interest rate risk and may consider hedging policies when necessary[192](index=192&type=chunk) [Pledged Assets and Capital Commitments](index=27&type=section&id=Pledged%20Assets%20and%20Capital%20Commitments) As of June 30, 2023, the Group had not pledged any assets to banks or financial institutions, nor did it have any capital commitments related to property, plant, and equipment - As of June 30, 2023, the Group had not pledged any assets to any banks or financial institutions (2022: nil)[162](index=162&type=chunk) - As of June 30, 2023, the Group had no capital commitments in respect of property, plant and equipment (2022: nil)[33](index=33&type=chunk) [Capital Expenditure](index=28&type=section&id=Capital%20Expenditure) For the year ended June 30, 2023, the Group invested approximately HK$203 thousand in property, plant, and equipment, primarily for furniture, fixtures, office equipment, and motor vehicles, a significant decrease from the prior year Changes in Capital Expenditure | Item | 2023 (HK$ thousand) | 2022 (HK$ thousand) | | :--- | :--- | :--- | | Investment in property, plant and equipment | 203 | 3,981 | - Investments were made for the purchase of furniture, fixtures, office equipment, and motor vehicles[193](index=193&type=chunk) [Corporate Governance and Other Information](index=28&type=section&id=Corporate%20Governance%20and%20Other%20Information) [Staff Policy](index=28&type=section&id=Staff%20Policy) As of June 30, 2023, the Group employed 144 staff in China and Hong Kong, offering competitive remuneration, retirement schemes, and benefits, and contributing to social security and provident funds in accordance with local regulations - As of June 30, 2023, the Group employed a total of **144 staff** in China and Hong Kong[199](index=199&type=chunk) - The Group's employees enjoy a comprehensive and competitive remuneration, retirement scheme, and benefits package, with discretionary bonuses awarded based on their performance[199](index=199&type=chunk) - The Group is required to contribute to social security schemes in China and has established a provident fund scheme for its Hong Kong employees[199](index=199&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=28&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) For the year ended June 30, 2023, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the year ended June 30, 2023, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[28](index=28&type=chunk) [Contingent Liabilities](index=28&type=section&id=Contingent%20Liabilities) As of the end of the reporting period, neither the Group nor the Company had any significant contingent liabilities - As of the end of the reporting period, neither the Group nor the Company had any significant contingent liabilities[164](index=164&type=chunk) [Audit Committee](index=29&type=section&id=Audit%20Committee) The Company's Audit Committee, comprising three independent non-executive directors, is responsible for reviewing financial reporting processes, risk management, internal controls, and financial performance, and has reviewed the consolidated financial statements for the year - The Company's Audit Committee is composed of **three independent non-executive Directors** of the Company[165](index=165&type=chunk) - The primary responsibilities of the Audit Committee include reviewing the Group's financial reporting processes, risk management, internal controls, and financial performance[165](index=165&type=chunk) - The Audit Committee, together with management and external auditors, has reviewed the accounting principles and practices adopted by the Group and discussed audit and financial reporting matters, including the review of the consolidated financial statements and annual results for the year ended June 30, 2023[165](index=165&type=chunk) [Code on Corporate Governance Practices](index=29&type=section&id=Code%20on%20Corporate%20Governance%20Practices) The Board believes that the Company has complied with the Code on Corporate Governance Practices set out in Appendix 14 to the Listing Rules throughout the year ended June 30, 2023 - The Board considers that the Company has complied with the Code on Corporate Governance Practices set out in Appendix 14 to the Listing Rules throughout the year ended June 30, 2023[36](index=36&type=chunk) [Standard Code for Securities Transactions by Directors](index=29&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Group has adopted the Standard Code set out in Appendix 10 to the Listing Rules as the code of conduct for directors' securities transactions, and all directors have confirmed compliance throughout the year - The Group has adopted the Standard Code set out in Appendix 10 to the Listing Rules as the code of conduct regarding directors' securities transactions[202](index=202&type=chunk) - All Directors of the Company have confirmed that they have complied with the required standards set out in the Standard Code throughout the year ended June 30, 2023[202](index=202&type=chunk) [Events After the Reporting Period](index=29&type=section&id=Events%20After%20the%20Reporting%20Period) The Group has agreed with the borrower on a revised repayment schedule for the renewed loan, with the final repayment date set for January 31, 2024, and all interest will be waived - The Group has engaged in discussions with the borrower and agreed on a revised repayment schedule for the renewed loan, with the final repayment date set for **January 31, 2024**[29](index=29&type=chunk) - If the borrower repays the principal of the renewed loan according to the revised repayment schedule, the lender will waive all interest (including any penalty interest) arising from the renewed loan[29](index=29&type=chunk) [Publication of Results Announcement and Annual Report](index=30&type=section&id=Publication%20of%20Results%20Announcement%20and%20Annual%20Report) This announcement has been published on the HKEXnews website and the Company's website, and the annual report for the year ended June 30, 2023, will be dispatched to shareholders and published on the aforementioned websites in due course - This announcement is published on the HKEXnews website (https://www.hkexnews.hk) and the Company's website (https://artgroup.etnet.com.hk)[37](index=37&type=chunk) - The annual report for the year ended June 30, 2023, will be dispatched to the Company's shareholders and published on the aforementioned websites in due course[37](index=37&type=chunk) [Board Composition](index=30&type=section&id=Board%20Composition) As of the date of this announcement, the Company's executive directors are Mr. Chen Jinyan and Mr. Chen Jindong, and the independent non-executive directors are Mr. Kwan Chi Fai, Ms. Cheung Sze Pui, and Ms. Wong Yuk Chun - As of the date of this announcement, the executive directors of the Company are Mr. Chen Jinyan and Mr. Chen Jindong; and the independent non-executive directors of the Company are Mr. Kwan Chi Fai, Ms. Cheung Sze Pui, and Ms. Wong Yuk Chun[203](index=203&type=chunk)

Financial Performance - The company reported a total comprehensive loss attributable to owners of the company of HKD (432,133) thousand for the six months ended December 31, 2022, compared to a profit of HKD 45,161 thousand in the same period of 2021, representing a significant decline [9]. - Basic and diluted loss per share from continuing and discontinued operations was HKD (14.55) for the six months ended December 31, 2022, compared to earnings of HKD 0.95 in the prior year [9]. - The company reported a loss attributable to owners of the company of HKD 391,151,000 for the six months ended December 31, 2022, compared to a profit of HKD 25,471,000 for the same period in 2021 [63]. - The company recognized a loss of HKD 483,146,000 from changes in the fair value of investment properties during the reporting period [45]. - The group reported a loss of approximately HKD 391,151,000 for the period, with a loss margin of 523.0%, compared to a profit margin of 47.1% in the previous year [172]. - Other income for the period was approximately HKD 17,599,000, a decrease from HKD 20,815,000 in the previous year, primarily due to the forced closure of shopping centers [172]. Equity and Liabilities - Total equity decreased to HKD 580,291 thousand as of December 31, 2022, down from HKD 1,012,424 thousand as of June 30, 2022, indicating a decline of approximately 42.6% [11]. - Non-current liabilities amounted to HKD 899,520 thousand as of December 31, 2022, compared to HKD 1,077,231 thousand as of June 30, 2022, reflecting a decrease of about 16.6% [11]. - The group reported a total of HKD 930,012,000 in lease liabilities as of December 31, 2022, down from HKD 976,100,000 as of June 30, 2022, representing a decrease of 4.7% [100]. - The group has no borrowings as of December 31, 2022, and has arranged four bonds totaling approximately HKD 26,351,000 [183]. Revenue and Income - Revenue from property operations for the six months ended December 31, 2021, was HKD 94,447 thousand, with a segment profit of HKD 55,041 thousand [31]. - Rental income, management fees, and operational service income for the period amounted to HKD 74,788,000, compared to HKD 94,447,000 for the six months ended December 31, 2021, indicating a decline of about 21% [71]. - The group recorded revenue of approximately HKD 74,788,000 for the six months ended December 31, 2022, a decrease of about 20.8% compared to HKD 94,447,000 in 2021 [130]. - The decrease in revenue was primarily due to rental reductions for over 235 tenants affected by the pandemic, amounting to approximately HKD 32,634,000 [130]. Operational Strategy - The company plans to focus on property management and related services, with a strategy to enhance operational efficiency and customer satisfaction [18]. - Future outlook includes potential market expansion and the introduction of new services to enhance revenue streams [18]. - The group plans to continue investing in property operations, including recruiting experienced personnel and exploring suitable shopping centers for expansion [156]. - The group aims to expand its tenant base by providing leasing, management, and operational services to more shopping centers, enhancing marketing efforts to create stable revenue streams [179]. Asset Management - As of December 31, 2022, the fair value of investment properties was HKD 1,292,045,000, down from HKD 1,843,529,000 as of June 30, 2022, representing a decrease of approximately 30% [68]. - The fair value of investment properties decreased by approximately HKD 483,146,000 due to COVID-19 restrictions, with the carrying value of these properties at HKD 1,292,045,000 as of December 31, 2022 [176]. - The company has recognized contract liabilities related to property management fees, which are collected in advance and recognized as revenue over the service period [18]. - The fair value of investment properties is determined by independent qualified valuers, ensuring compliance with valuation standards [70]. Compliance and Governance - The company is committed to maintaining compliance with Hong Kong Financial Reporting Standards and has adopted relevant accounting policies consistently [13]. - The company did not declare or recommend any dividends during the reporting period, consistent with the previous period [55]. - The group has not proposed an interim dividend for the period, consistent with the previous year [154]. - As of December 31, 2022, there were no significant contracts involving the company's directors with substantial interests [194]. Challenges and Risks - The impairment loss for rental deposits was approximately HKD 35.79 million, a significant increase compared to the previous year, attributed to increased credit risk from certain banks and financial institutions [152]. - The group remains committed to maintaining reasonable working capital despite challenges posed by the COVID-19 pandemic [162]. - The anticipated reopening of the Chinese economy is expected to positively impact sales and foot traffic in shopping malls, leading to a gradual recovery in tenant confidence [159].

Financial Performance - The company reported revenue of HKD 184,601,000 for the year, a decrease of 1.1% from HKD 188,634,000 in the previous year, and a net loss of HKD 88,159,000 compared to a loss of HKD 227,892,000 in the prior year[9]. - The company recorded revenue of approximately HKD 184,601,000 for the fiscal year ending June 30, 2022, a decrease of about 2.1% compared to HKD 188,634,000 in 2021[30]. - The group incurred a loss of approximately HKD 77,683,000 for the fiscal year ending June 30, 2022, a substantial decrease from HKD 196,375,000 in 2021, resulting in a loss rate of 42.1%[33]. - Other income and gains amounted to approximately HKD 33,156,000 for the fiscal year ending June 30, 2022, compared to HKD 30,150,000 in 2021, primarily due to interest income from loans[34]. - The gross profit margin increased significantly to approximately 79.8% for the fiscal year ending June 30, 2022, up from 56.4% in 2021[32]. - Administrative expenses decreased by approximately 25.2% to HKD 23,617,000, representing 12.8% of revenue, down from 16.7% in 2021[35]. - Financial expenses amounted to HKD 47,711,000, representing 25.8% of revenue for the year ended June 30, 2022, a decrease from 34.9% in the previous year[40]. - The expected credit loss for receivable loans was approximately HKD 51,551,000, accounting for 27.9% of revenue, significantly up from HKD 460,000 in 2021[35]. - The fair value of investment properties was approximately HKD 1,843,529,000 as of June 30, 2022, down from HKD 2,050,602,000 in 2021, reflecting a loss of approximately HKD 162,651,000 due to rental growth slowdown[39]. Property Operations - The company acquired a 25% stake in Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co., which has become a wholly-owned subsidiary, shifting focus towards property operations[9]. - The group acquired a 25% stake in Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co., making it an indirect wholly-owned subsidiary[23]. - The group plans to enhance property operations by offering leases to more well-known brands and diversifying tenant types to meet various customer needs[18]. - The group aims to explore investment opportunities in property operations due to the significant market potential in China driven by its large population and strong consumer power[18]. - The group aims to expand its tenant base by providing leasing and management services to more shopping centers, enhancing revenue stability[45]. - The company leased two shopping malls in Zhengzhou, with the first mall having a total area of approximately 125,188 square meters and an occupancy rate of about 94.9% as of June 30, 2022[10]. - The second shopping mall has an area of approximately 80,118 square meters and an occupancy rate of about 92.7% as of June 30, 2022[11]. - As of June 30, 2022, approximately 94.9% of the leasable area of Jiachao Shopping Center was leased to about 134 tenants[23]. - The leasable area of Shopping Center C was approximately 80,118 square meters, with about 92.7% leased to around 112 tenants as of June 30, 2022[24]. Cost Management and Profitability - The company aims to penetrate the property operation market and implement strict cost control policies to increase profit margins[15]. - The group continues to implement prudent cost management policies to improve operational efficiency and maintain a reasonable financial position[18]. - The group plans to continue investing in property operations and may consider acquisitions to strengthen its management team[45]. - The group will focus on developing existing projects and exploring new opportunities, including partnerships, to broaden revenue sources and enhance profitability[18]. Dividends and Shareholder Value - The board declared a special dividend of HKD 0.08 per share for the year ended June 30, 2022, compared to no dividend in the previous year[41]. - A special dividend of HKD 0.08 per share was paid in June 2022, with no final dividend recommended for the year ending June 30, 2022[71]. - The company has established a dividend policy aimed at maximizing shareholder value, with the board having full discretion over dividend declarations[148]. - Factors considered for dividend declaration include operating and financial performance, cash flow, and future earnings[149]. - The board will review the dividend policy periodically and may update it as deemed necessary[150]. Governance and Compliance - The company ensures compliance with applicable laws, rules, and regulations through its governance policies and practices[125]. - The company has established various committees, including the audit committee, remuneration committee, and nomination committee, to enhance corporate governance[120]. - The audit committee consists of four independent non-executive directors, ensuring effective oversight of financial reporting and compliance[122]. - The audit committee reviewed the effectiveness of the internal control system, which was deemed effective and sufficient[115]. - The company has obtained appropriate directors' and officers' liability insurance for its directors and senior management[98]. - The company has arranged appropriate liability insurance for directors to cover responsibilities arising from corporate activities[116]. - The board is responsible for monitoring the company's business and making decisions in the best interest of the company and its shareholders[115]. Environmental and Social Responsibility - The company is committed to sustainable development in its operational locations, focusing on resource efficiency and emissions reduction[160]. - The board is responsible for environmental, social, and governance (ESG) performance and regularly assesses ESG risks and strategies[160]. - The total carbon emissions from the group amounted to approximately 1.2 tons, a decrease from 1.61 tons in the previous year[168]. - The group monitored exhaust emissions from underground parking facilities, which operated approximately 2,900 hours annually[168]. - The wastewater discharge during the reporting period was approximately 130 kilograms, slightly down from 136 kilograms in the previous year[171]. - The group has constructed a total of 7 discharge outlets for wastewater from shopping centers, ensuring compliance with national standards[171]. - The group is committed to reducing waste and promoting sustainable development through specific policies and indicators[162]. - The group engages with stakeholders through various channels, including annual meetings and reports, to understand their expectations[164]. - The group identified COVID-19 and flooding as highly significant issues during its annual materiality assessment[167]. - The group adheres to environmental protection laws and standards during construction and operation phases[168]. Employee Management and Training - The group has a total of 141 employees, with a gender distribution of 87 males and 54 females, and an average age of 37 years[194]. - The employee turnover rate for the year was 14%, with 14 male and 6 female employees leaving, and 30% of those departing were over 45 years old[194]. - The group conducted 9 training sessions during the year, with a total of 550 participants, including 330 males and 220 females, resulting in a male-to-female training participation ratio of 1.5:1[198]. - The average training time for employees was 1.5 hours, with male employees receiving an average of 1.1 hours and female employees receiving 1.8 hours[198]. - The company fully complies with the Labor Law of the People's Republic of China and the Employment Ordinance of Hong Kong during recruitment processes[199]. - The company prohibits the employment of child labor and forced labor, ensuring no such incidents occurred during the reporting period[199]. Supplier Management - The company categorizes suppliers based on service characteristics, including procurement suppliers, builders, and external security and cleaning suppliers[199]. - A unified bidding process is implemented for selecting suppliers and builders, with clear standards and specifications outlined[199]. - Multiple departments are involved in the evaluation process to ensure consistent assessment methods for bids[199]. - A supply chain information system has been established to facilitate collaboration and achieve win-win outcomes[199]. - All suppliers and builders will undergo a quality service review at the end of the year[199]. - An evaluation system linked to salaries has been developed for external security and cleaning suppliers to enhance service quality[199].

Financial Performance - For the six months ended December 31, 2021, the company reported revenue of HKD 94,447,000, an increase of 2.66% compared to HKD 92,000,000 for the same period in 2020[13]. - The cost of sales decreased significantly to HKD 18,321,000 from HKD 40,079,000, resulting in a gross profit of HKD 76,126,000, up from HKD 51,921,000[13]. - The company recorded a profit before tax of HKD 58,220,000, compared to a loss of HKD 379,949,000 in the previous year[13]. - Net profit from continuing operations for the period was HKD 44,460,000, a substantial recovery from a loss of HKD 282,585,000 in the same period last year[13]. - The total comprehensive income for the period was HKD 55,830,000, compared to a loss of HKD 156,483,000 in the previous year[15]. - The earnings per share for the period was HKD 25,471, compared to a loss per share of HKD 217,902 in the same period last year[15]. - The total comprehensive income attributable to the company's owners for the six months ended December 31, 2021, was HKD 45,161, compared to a loss of HKD 111,658 for the same period in 2020[19]. - Basic and diluted earnings per share from continuing and discontinued operations were HKD 0.95, recovering from a loss of HKD 8.10 in the previous year[19]. - The gross profit margin for the period was approximately 80.6%, a significant increase from 56.4% in 2020[125]. - The group generated a profit of approximately HKD 44,460,000, compared to a loss of HKD 282,585,000 in 2020, resulting in a profit margin of about 47.1%[129]. Cash Flow and Liquidity - Cash and cash equivalents increased to HKD 188,692 from HKD 16,693 in the previous period, indicating improved liquidity[20]. - Net cash generated from operating activities was HKD 336,216, a significant increase from HKD 33,797 in the prior year[27]. - The total cash flow from operating activities for the six months ended December 31, 2021, was HKD 31,002,000, compared to HKD 1,032,000 in the same period of 2020[77]. - The group reported a net cash outflow from investing activities of HKD 259,036, primarily due to acquisitions and loan advances[27]. - The group reported a net cash outflow of HKD 46,000 from the sale of the subsidiary, reflecting minimal cash generation from the transaction[74]. Assets and Liabilities - The company's non-current assets totaled HKD 2,273,344 as of December 31, 2021, slightly increasing from HKD 2,236,451 as of June 30, 2021[20]. - The company’s current liabilities increased to HKD 44,936 from HKD 35,126, reflecting a rise in operational obligations[20]. - Total equity attributable to the company's owners was HKD 1,400,485, up from HKD 1,354,551 as of June 30, 2021[22]. - The company’s total assets less current liabilities stood at HKD 2,593,294, a decrease from HKD 2,698,285 in the previous period[22]. - The group aims to maintain a current ratio of approximately 291.1% as of December 31, 2021, down from 396.3% on June 30, 2021[140]. - Total equity as of December 31, 2021, was approximately HKD 1,400,485,000, a decrease from HKD 1,514,758,000 on June 30, 2021[140]. Business Operations and Strategy - The company has plans for market expansion and new product development, although specific details were not disclosed in the report[13]. - The company aims to enhance operational efficiency and explore strategic partnerships to drive future growth[13]. - The group has future minimum lease payments of HKD 420,595,000, down from HKD 486,103,000[92]. - The company’s management team operates both the Jiachao Shopping Center and Shopping Center C, which is expected to generate significant income with minimal additional costs[121]. - Future plans include expanding leasing, management, and operational services to more shopping centers, with a focus on marketing and promotion activities[134]. Discontinued Operations - The group has ceased its biotechnology business, and the results from this segment have been classified as discontinued operations in the financial statements[40]. - The net loss from the discontinued biotechnology business for the six months ended December 31, 2021, was HKD 10,476,000, compared to a loss of HKD 5,934,000 in the same period of 2020[62]. - The group reported a loss of approximately HKD 10,476,000 from discontinued operations, an increase of 76.5% compared to HKD 5,934,000 in 2020[132]. - The group completed the sale of its entire equity interest in City Charm International Limited for a nominal price of USD 1.00 on November 22, 2021, marking the termination of its biotechnology operations[59]. Tenant and Rental Information - Property rental income for the six months ended December 31, 2021, was HKD 37,407,000, slightly up from HKD 37,309,000 in the previous year[36]. - Property management fee income increased to HKD 55,293,000 for the six months ended December 31, 2021, from HKD 53,513,000 in the same period of 2020, reflecting a growth of approximately 3.33%[36]. - The single largest tenant contributed 10% or more to the group's revenue, with total revenue from this tenant amounting to HKD 17,272,000 for the six months ended December 31, 2021, compared to HKD 16,087,000 in the previous year[33]. - As of December 31, 2021, approximately 99.0% of the leasable area of the Jiachao Shopping Center was rented out, with a remaining lease term of 1 to 13 years[117]. Corporate Governance and Compliance - The company adhered to the corporate governance code as per Appendix 14 of the listing rules, enhancing accountability and transparency[171]. - The audit committee, composed of four independent non-executive directors, reviewed the financial reporting procedures and risk management[173]. Employee and Training - The group employed a total of 144 employees in China and Hong Kong, providing competitive compensation and benefits[148]. - The group regularly provides internal training for employees[149].

Financial Performance - The company reported revenue of HKD 188,634,000 for the year, an increase of 18.2% from HKD 159,547,000 in 2020, but incurred a loss of HKD 227,892,000 compared to a loss of HKD 35,713,000 in the previous year[9]. - The gross profit margin for the fiscal year ending June 30, 2021, was approximately 56.4%, down from 60.1% in 2020, attributed to increased variable sales costs as shopping centers resumed normal operations[35]. - The group incurred a loss of approximately HKD 227,892,000 for the fiscal year ending June 30, 2021, with a loss rate of 120.8%, significantly higher than 22.4% in 2020, primarily due to a substantial decrease in the fair value of investment properties[35]. - Other income for the fiscal year ending June 30, 2021, was approximately HKD 30,280,000, an increase from HKD 14,764,000 in 2020, driven by increased customer spending and government subsidies[36]. - Administrative expenses were approximately HKD 37,696,000, accounting for about 20.0% of revenue, up from 18.8% in 2020, reflecting costs related to biotechnology trials and the sale of a subsidiary[39]. - Financial expenses amounted to approximately HKD 66,243,000, representing 35.1% of revenue, an increase due to higher interest rates on bank loans[40]. - The group recorded revenue of approximately HKD 188,634,000 for the fiscal year ending June 30, 2021, an increase of about 18.2% compared to HKD 159,547,000 in 2020[34]. Business Strategy and Operations - The company has shifted its business focus towards light asset and service-based property operations after selling a 75% stake in Zhengzhou Jiachao Property Services Co., Ltd[9]. - The group plans to enhance property operations by leasing to more well-known brands and diversifying tenant types to meet various customer needs[18]. - The group plans to expand its property operations by focusing on leasing, management, and operational services to various tenants in shopping centers[40]. - The group aims to diversify tenant types and upgrade shopping centers to meet the needs of different customer demographics through marketing and promotional activities[42]. - The group is committed to exploring investment opportunities in property operations under the Belt and Road Initiative and the dual circulation economic strategy[18]. - The group anticipates stable business development in the future while exploring suitable property operations and biotechnology projects to broaden revenue sources[19]. Biotechnology Sector - The company is exploring the biotechnology sector in Yunnan Province, China, with subsidiaries established for the production of cannabidiol (CBD) and has received necessary licenses for industrial hemp cultivation and trial production[16]. - The group has entered the biotechnology sector, holding a 60% stake in Honghe Qianlin Biotechnology Co., Ltd., which is involved in the production of industrial-grade cannabidiol for overseas markets[30]. - The group aims to diversify its business by developing biotechnology in Yunnan Province, China, with commercial production expected to start upon receiving the industrial hemp production license[43]. - The group anticipates optimistic future prospects for cannabidiol due to its widespread use in various sectors, supported by government initiatives like the Belt and Road Initiative[48]. Tenant and Customer Relations - The company provided rental and operational support to tenants during the COVID-19 pandemic, amounting to approximately HKD 697,000, a significant decrease from HKD 17,705,000 in 2020[15]. - The group has allowed certain tenants to defer rent payments and has reduced costs as a key strategic focus to address uncertainties caused by the COVID-19 pandemic[34]. - The company’s top five customers accounted for 30% of total sales, with the largest customer contributing approximately 18%[96]. - The company’s top five suppliers accounted for 58% of total purchases, with the largest supplier contributing approximately 49%[96]. Financial Position and Assets - As of June 30, 2021, the group's net current assets were approximately HKD 461,834,000, an increase from HKD 290,629,000 in 2020, and total assets were HKD 2,698,285,000, down from HKD 2,978,960,000 in 2020[49]. - The group's cash and bank deposits as of June 30, 2021, were approximately HKD 16,693,000, significantly decreased from HKD 419,095,000 in 2020[49]. - The current ratio as of June 30, 2021, was approximately 396.3%, up from 274.1% in 2020, indicating improved liquidity[49]. - The group has established a loan agreement to provide RMB 250 million at an interest rate of 7.5% to an independent third party, indicating a surplus cash position[31]. Corporate Governance - The board of directors held eight meetings during the fiscal year, with all members attending every meeting[113]. - The board is responsible for monitoring the company's business and financial performance, including expanding property operations and enhancing tenant satisfaction[116]. - The company has received annual confirmations of independence from all independent non-executive directors[96]. - The audit committee reviewed the effectiveness of the internal control system, which was deemed effective and adequate[116]. - The company has implemented corporate governance practices to enhance credibility and transparency[108]. Environmental and Social Responsibility - The company is committed to sustainable development in its operational locations, focusing on effective resource utilization, energy conservation, and emission reduction[158]. - The company has established a cannabis cannabidiol production line, which has undergone environmental assessments and complies with national and regional industrial policies[163]. - The company has committed to maintaining compliance with relevant laws and regulations regarding emissions and waste management throughout the reporting period[171]. - The company emphasizes the importance of stakeholder communication to meet expectations and enhance sustainability in its operations[162]. Employee and Community Engagement - The employee turnover rate for the reporting period was 22%, with 50% of departing employees from Zhengzhou[186]. - The group employed 148 full-time staff, with 90% based in Zhengzhou, and an average age of 38 years[186]. - The shopping center has created over 7,000 job opportunities, contributing positively to the community, especially in areas such as children's entertainment, education, and culture[198]. - A total of 432 training sessions were conducted during the reporting period, with 260 male and 172 female participants, resulting in a male-to-female training participation ratio of 1.5:1[190].

Financial Performance - The group reported revenue of HKD 92,000,000 for the six months ended December 31, 2020, compared to HKD 88,939,000 for the same period in 2019, representing a growth of 2.4%[9] - Gross profit for the period was HKD 51,921,000, down from HKD 54,985,000 in the previous year, indicating a decrease of 5.6%[9] - Other income increased significantly to HKD 15,981,000 from HKD 8,209,000, reflecting a growth of 94.1%[9] - The group incurred a loss before tax of HKD 385,883,000, compared to a profit of HKD 16,185,000 in the same period last year[9] - The net loss for the period was HKD 288,519,000, a significant decline from a profit of HKD 14,893,000 in the prior year[9] - Total comprehensive loss for the period amounted to HKD 156,483,000, compared to a loss of HKD 7,081,000 in the previous year[9] - Basic and diluted loss per share was HKD 8.10, compared to earnings of HKD 0.35 per share in the same period last year[14] - The group incurred a loss of HKD 288,519,000 for the six months ended December 31, 2020, compared to a profit of HKD 14,893,000 for the same period in 2019[33] - The total financial expenses for the six months ended December 31, 2020, were HKD 30,896,000, an increase from HKD 27,012,000 in the previous year, representing a rise of about 10.6%[36] Assets and Liabilities - Non-current assets increased to HKD 2,493,055 thousand as of December 31, 2020, compared to HKD 2,688,331 thousand as of June 30, 2020, reflecting a decrease of approximately 7.3%[15] - Current assets decreased to HKD 402,241 thousand from HKD 457,544 thousand, a decline of about 12.1%[15] - Total equity decreased to HKD 1,586,381 thousand from HKD 1,748,402 thousand, representing a reduction of approximately 9.2%[17] - Cash and cash equivalents decreased to HKD 352,311 thousand from HKD 419,095 thousand, a decrease of around 15.9%[21] - Total liabilities decreased to HKD 1,131,959 thousand from HKD 1,230,558 thousand, a decrease of about 8%[17] - The company’s total assets less current liabilities amounted to HKD 2,718,340 thousand, down from HKD 2,978,960 thousand, a decline of about 8.7%[17] - The total debt ratio as of December 31, 2020, was approximately 56.6%, an increase from 52.6% as of June 30, 2020, indicating a rise in leverage[105] Cash Flow - Net cash generated from operating activities was HKD 33,797 thousand, significantly lower than HKD 278,137 thousand in the same period last year, indicating a decline of approximately 87.8%[21] - The company’s cash flow from financing activities showed a net outflow of HKD 125,402 thousand, contrasting with a net inflow of HKD 112,453 thousand in the previous year[21] - The group’s cash and bank deposits as of December 31, 2020, were approximately HKD 352,311,000, down from HKD 419,095,000 as of June 30, 2020, reflecting a decrease of about 15.9%[104] - The group has a total borrowing amount of approximately HKD 864,050,000 as of December 31, 2020, slightly down from HKD 874,523,000 as of June 30, 2020, indicating a reduction of about 1.7%[106] Revenue Sources - Rental income from property leasing was HKD 37,309,000 for the six months ended December 31, 2020, up from HKD 35,555,000 in the previous year, indicating an increase of about 4.9%[29] - Property management fee income was HKD 53,513,000, compared to HKD 51,847,000 in the prior period, reflecting a growth of approximately 3.2%[29] - The group did not generate any revenue from its biotechnology segment during the reporting period[31] - The group had a single tenant contributing over 10% of total revenue, with total revenue from this tenant amounting to HKD 16,087,000, compared to HKD 14,058,000 in the previous year[28] Investment Properties - The company’s investment properties were valued at HKD 2,432,795 thousand as of December 31, 2020, down from HKD 2,637,363 thousand, reflecting a decrease of approximately 7.7%[15] - The fair value of investment properties decreased to HKD 2,432,795,000 as of December 31, 2020, down from HKD 2,806,818,000 as of June 30, 2020, reflecting a loss of HKD 403,000,000 due to fair value changes[48] - The fair value loss of investment properties was approximately HKD 403,000,000, reflecting the impact of the COVID-19 pandemic on rental growth[93] Corporate Governance - The company adheres to the corporate governance code as per the Hong Kong Stock Exchange's listing rules, ensuring accountability and transparency[128] - The audit committee consists of four independent non-executive directors, responsible for reviewing financial reporting and risk management[130] Future Plans and Developments - The group plans to separate property holding and property operation businesses to streamline operations, establishing a new company with a 75% indirect ownership[97] - The anticipated annual production capacity of the newly established biotechnology subsidiary is approximately 2,000 kilograms of CBD for industrial use[83] - The group plans to continue investing additional resources to drive growth in property operations and the biotechnology market, particularly in Zhengzhou, which is seen as a strategic location due to its economic and demographic factors[102] - The group has received industrial hemp cultivation and trial production permits from Chinese regulatory authorities and is awaiting the industrial hemp production license to commence commercial production[98] - The group aims to enhance profitability by exploring new opportunities in property operations and biotechnology, while maintaining strict cost control measures[101] Shareholder Information - As of December 31, 2020, Mr. Chen Jin Dong holds 369,100,000 shares, representing 13.73% of the company's issued share capital[115] - Mr. Chen Jin Yan holds 597,280,000 shares, accounting for 22.21% of the company's issued share capital[116] - The company has a stock option plan effective from November 22, 2013, with 2,080,000 options held by each of Mr. Lin Ye and Mr. Yang Ze Qiang[125] - No shares or securities were purchased, sold, or redeemed by the company or its subsidiaries during the period[127] Other Information - No dividends were declared or proposed during the interim period[43] - There were no significant events to report after the reporting period[77] - The company reported a total remuneration of HKD 2,004,000 for directors and key management personnel, consistent with the previous year[75] - Capital expenditures related to property, plant, and equipment were HKD 429,000 for the six months ending December 31, 2020, down from HKD 1,494,000 for the previous period[72] - The depreciation of property, plant, and equipment amounted to HKD 789,000 for the six months ended December 31, 2020, down from HKD 1,368,000 in the prior period[42] - The group provided rental and operational support totaling approximately HKD 681,000 to certain tenants during the pandemic[84] - Administrative expenses were approximately HKD 17,503,000, accounting for about 19.0% of revenue, a decrease from 22.5% in 2019[90]

Financial Performance - The company reported revenue of HKD 159,547,000 for 2020, a decrease of 24.6% from HKD 211,818,000 in 2019, and incurred a loss of HKD 35,713,000 compared to a profit of HKD 76,439,000 in the previous year[9]. - The group recorded revenue of approximately HKD 159,547,000 for the fiscal year ending June 30, 2020, a decrease of about 24.7% compared to HKD 211,818,000 in 2019[33]. - The gross profit margin for the fiscal year ending June 30, 2020, was approximately 60.1%, down from 69.9% in 2019[34]. - The group incurred a loss of approximately HKD 35,713,000 for the fiscal year ending June 30, 2020, compared to a profit of HKD 76,439,000 in 2019, resulting in a loss margin of 22.4%[35]. - Other income for the fiscal year ending June 30, 2020, was approximately HKD 14,764,000, a decrease from HKD 16,066,000 in 2019, primarily due to reduced parking usage[36]. - Administrative expenses increased by approximately 12.1% to HKD 29,946,000, accounting for about 18.8% of revenue for the fiscal year ending June 30, 2020[37]. - Financial expenses rose significantly to approximately HKD 61,942,000, representing about 38.8% of revenue, due to higher interest rates on new bank loans[37]. - The fair value of investment properties decreased by approximately HKD 77,778,000, reflecting a slowdown in rental growth[38]. - The board did not recommend a final dividend for the fiscal year ending June 30, 2020[39]. - The total equity of the group as of June 30, 2020, was approximately HKD 1,748,402,000, down from HKD 1,856,626,000 in 2019, with a total debt ratio of approximately 52.6%, up from 28.5% in 2019[49]. - The group plans to invest approximately HKD 6,463,000 in property, plant, and equipment for the year ending June 30, 2020, compared to HKD 1,241,000 in 2019[56]. Tenant and Property Management - The company has a shopping mall in Zhengzhou, China, with a total registered construction area of approximately 125,188 square meters, fully leased to over 140 tenants[10]. - A new shopping center (Zone C) with a total construction area of approximately 80,118 square meters has been leased, with around 120 tenants providing various services and products[11]. - The company provided rental and management fee reductions totaling approximately HKD 17,705,000 to over 280 tenants during the first half of 2020 due to COVID-19[15]. - The company provided rent relief totaling approximately HKD 17,705,000 to over 280 tenants during the first half of 2020 due to the impact of COVID-19[26]. - The company holds a 75% stake in Jiachao Property Services Co., which operates the Jiachao Shopping Center in Zhengzhou, China[24]. - The group plans to enhance tenant quality at the Jiachao Shopping Center and diversify tenant types to meet various customer needs[40]. - The company plans to enhance tenant diversity and upgrade tenant categories to meet the needs of various customer demographics[18]. - The company is focused on expanding its property operations market and enhancing tenant satisfaction[117]. Biotechnology Sector - The company is exploring the biotechnology sector, having established subsidiaries in Yunnan Province for the production of cannabidiol (CBD) and has secured an industrial hemp planting license[16]. - The company has entered the biotechnology sector, holding a 60% stake in Qianlin Biotechnology, which is expected to produce approximately 2,000 kg of CBD annually[27]. - A factory of approximately 2,904 square meters has been leased for production, with a total land area of about 1,028,133 square meters for raw material cultivation[16]. - The company plans to start trial operations in early 2021 once it receives the necessary production permits and completes equipment installation[16]. - The group aims to diversify its business and expand into the biotechnology market, leveraging the optimistic future prospects of cannabidiol due to regulatory approvals in Australia, Europe, and North America[47]. - The group has installed machinery for distillation and extraction processes in its newly leased factory in Yunnan, China[27]. Financial Position and Assets - As of June 30, 2020, the group's net current assets were approximately HKD 290,629,000, compared to HKD 124,948,000 in 2019, and total assets minus current liabilities were approximately HKD 2,978,960,000, up from HKD 2,721,116,000 in 2019[48]. - The group's cash and bank deposits as of June 30, 2020, were approximately HKD 419,095,000, significantly increased from HKD 32,377,000 in 2019, resulting in a current ratio of approximately 274.1% compared to 71.3% in 2019[48]. - The group has a total borrowing of approximately HKD 874,523,000 as of June 30, 2020, compared to HKD 494,318,000 in 2019, with all financing fully utilized[50]. Corporate Governance - The company has adopted corporate governance practices in line with the Hong Kong Stock Exchange's guidelines, ensuring transparency and accountability[109]. - The company’s board of directors includes four independent non-executive directors, ensuring diverse oversight[75]. - The board consists of at least one-third independent non-executive directors, ensuring independence in decision-making[111]. - The board held eight meetings during the fiscal year ending June 30, 2020, with all directors attending most meetings[114]. - The company encourages directors to participate in training courses to enhance their knowledge and performance[115]. - The company has arranged appropriate liability insurance for directors to cover responsibilities arising from corporate activities[117]. - The audit committee is composed of four independent non-executive directors, ensuring oversight of financial reporting[125]. - The Audit Committee reviewed the independence of external auditors and their provision of non-audit services[132]. Environmental and Social Responsibility - The group reported an electricity consumption of approximately 32,243,000 kWh during the reporting period, with an energy consumption density of 157.05 kWh/sqm[169]. - The group achieved a reduction in electricity costs of over 18.9% due to a power sales agreement and government initiatives, primarily impacted by the pandemic-related closure of shopping centers[169]. - The group generated a total of 1.095 million cubic meters of non-hazardous waste during the reporting period, with a density of 5.33 cubic meters/sqm[166]. - The group monitored emissions from its underground parking facilities, with total carbon monoxide emissions reaching 1.61 tons[162]. - The group installed oil fume purification facilities in its dining tenants to comply with the "Air Pollution Prevention Law" and related standards[164]. - The group constructed seven sewage outlets for wastewater discharge, ensuring compliance with the "Comprehensive Wastewater Discharge Standards" and "Urban Sewage Discharge Standards"[165]. - The group has implemented waste classification systems in its managed shopping centers to ensure proper waste disposal and recycling[166]. - The group’s pollution prevention measures strictly adhere to relevant Chinese government regulations and standards during construction and operation[162]. - The group has a green area of 2,550 square meters to improve the ecological environment[176]. - The group has implemented a training card system for employees, requiring at least 12 points of training within a year to meet assessment standards[181]. - The group adheres to labor laws and regulations, ensuring no violations related to employment practices[179]. - The opening of Jiachao Shopping Center has created over 7,000 job opportunities, significantly contributing to the local community, especially in areas such as children's entertainment, education, and culture[187]. - The company has complied with health and safety regulations regarding the products and services offered, with no complaints received from tenants during the reporting period[185]. - The company has implemented measures to prevent bribery among employees, suppliers, and tenants, with no corruption lawsuits reported during the reporting period[186].

Financial Performance - For the six months ended December 31, 2019, the company reported revenue of HKD 88,939,000, a decrease of 2.4% from HKD 91,381,000 in the same period of 2018[14] - The gross profit for the same period was HKD 54,985,000, down from HKD 61,241,000, reflecting a decline of approximately 10.3%[14] - The company recorded a profit before tax of HKD 16,185,000, significantly lower than HKD 41,181,000 in the previous year, representing a decrease of 60.7%[14] - The net profit for the period was HKD 14,893,000, down 54.8% from HKD 32,946,000 in the prior year[14] - The basic and diluted earnings per share were both HKD 0.35, compared to HKD 0.87 in the same period last year, indicating a decline of 59.8%[15] - The company experienced a total comprehensive loss of HKD 7,081,000, a significant improvement from a loss of HKD 50,404,000 in the previous year[15] - The total comprehensive loss attributable to owners of the company was HKD 8,469,000, compared to a loss of HKD 43,000,000 in the same period of 2018[15] - The operating profit for the property operation segment was HKD 23,825,000, compared to HKD 47,662,000 in the same period of 2018, reflecting a significant decline[68] - The company reported a net profit of HKD 14,893,000 for the six months ended December 31, 2019, down from HKD 32,946,000 in the same period of 2018[68] - The group generated a profit of HKD 14,893,000 during the period, a significant decrease from HKD 32,946,000 in 2018, with a profit margin of approximately 16.7% compared to 36.1% in 2018[124] Revenue and Expenses - The company reported an increase in administrative expenses to HKD 19,898,000 from HKD 12,973,000, reflecting a rise of 53.5%[14] - The total interest expenses for the period were HKD 27,012,000, an increase from HKD 15,083,000 in the previous year[73] - Financial expenses rose to HKD 27,012,000 from HKD 15,083,000 in 2018, representing about 30.4% of revenue, attributed to higher interest rates on new bank borrowings[128] - Other income for the period was HKD 8,209,000, slightly up from HKD 7,996,000 in 2018, primarily from parking fees and other services provided to tenants[125] Assets and Liabilities - As of December 31, 2019, total assets amounted to HKD 3,123,384,000, an increase from HKD 2,721,116,000 as of June 30, 2019, representing a growth of approximately 14.8%[19] - Total equity as of December 31, 2019, was HKD 1,838,169,000, a slight decrease from HKD 1,856,626,000 as of June 30, 2019, showing a decline of approximately 1.0%[19] - The company reported a decrease in trade and other receivables to HKD 36,851,000 from HKD 278,114,000, a reduction of about 86.8%[19] - Non-current liabilities increased significantly to HKD 1,285,215,000 as of December 31, 2019, compared to HKD 864,490,000 as of June 30, 2019, marking an increase of approximately 48.6%[19] - The group has a total of HKD 54,502,000 in trade payables and other payables as of December 31, 2019, compared to HKD 65,309,000 as of June 30, 2019[96] - As of December 31, 2019, the group had a total bond liability of HKD 44,301,000, reflecting an increase in interest expenses during the period[101] Cash Flow - The net cash generated from operating activities for the six months ended December 31, 2019, was HKD 278,137,000, compared to HKD 83,814,000 for the same period in 2018, indicating a significant increase of 231.5%[27] - The company's cash and cash equivalents increased to HKD 423,418,000 as of December 31, 2019, up from HKD 32,377,000 at the beginning of the period, reflecting a growth of 1,210.5%[27] - The net cash used in investing activities was HKD (47,000) for the six months ended December 31, 2019, compared to HKD (1,209,000) in the same period of 2018, indicating a reduction in cash outflow[27] - The company’s bank borrowings increased to HKD 888,889,000 during the financing activities, reflecting a significant inflow of funds[27] Corporate Governance and Compliance - The company adheres to high standards of corporate governance and complies with the corporate governance code as per the listing rules[162] - The company has adopted the standard code of conduct for directors' securities trading as per the listing rules appendix, confirming compliance during the period[163] - The audit committee consists of four independent non-executive directors, responsible for reviewing financial reporting processes, risk management, and internal controls[165] - The audit committee has discussed the review of the group's accounting principles and practices along with management and external auditors[165] Future Outlook and Strategy - The company has not disclosed specific future outlook or guidance in the provided content[13] - The company plans to develop a biotechnology segment through a 60% stake in Honghe Qianlin Biotechnology Co., with a factory set to begin construction in 2020, targeting an annual production of approximately 2,000 kg of CBD[120] - The group anticipates positive results from its diversified business strategy and aims to maximize shareholder returns through ongoing market opportunities[133] - The group plans to expand its property operations and has invested significant resources in this area, aiming to enhance shareholder returns through diversified tenant types and marketing activities[130] Employee and Shareholder Information - The group employed a total of 154 employees in China and Hong Kong as of December 31, 2019, providing competitive compensation and benefits[144] - Major shareholders as of December 31, 2019, included Lin Lin with 369,100,000 shares (13.73%) and Chen Jinqing with 166,000,000 shares (6.17%)[156] - The company’s management compensation for the period totaled HKD 2,004,000, determined based on individual performance and market trends[111] Investment Properties - The fair value of investment properties at the end of the reporting period was HKD 2,775,281,000, down from HKD 3,208,333,000 at the beginning of the year[85] - As of December 31, 2019, the fair value of the group's investment properties was HKD 2,775,281,000, compared to HKD 2,806,818,000 as of June 30, 2019[86] - Rental income, management fees, and operational service income for the period amounted to HKD 88,939,000, a decrease from HKD 91,381,000 for the same period in 2018[88] - Future minimum lease payments contracted with tenants as of December 31, 2019, totaled HKD 789,214,000, down from HKD 999,674,000 as of June 30, 2019[90] Financial Reporting Standards - The company applies the Hong Kong Financial Reporting Standard 16 for leases, assessing contracts for lease components at the initial or modification date[36] - The company applies the Hong Kong Financial Reporting Standard 15 to allocate contract consideration to lease and non-lease components starting from July 1, 2019[51] - Refundable lease deposits are recognized at fair value and adjustments at initial recognition are treated as additional lease payments from the lessee[52] - The company treats lease modifications as new leases and considers any prepaid or accrued lease payments as part of the new lease payments[54]