Financial Performance - The Group's revenue for the year ended December 31, 2022, was approximately HK$2,715,000, a decrease of 14% compared to approximately HK$3,157,000 for the year ended December 31, 2021[15]. - The loss attributable to owners of the Company for the year ended December 31, 2022, was approximately HK$227,735,000, significantly reduced from a loss of approximately HK$581,677,000 for the year ended December 31, 2021[15]. - The loss from changes in fair value of investment properties was approximately HK$3,393,000 in 2022, down from approximately HK$24,944,000 in 2021[15]. - The impairment loss recognized for financial assets under the expected credit losses model was approximately HK$177,609,000 in 2022, compared to HK$192,300,000 in 2021[15]. - The Group's share of losses from associates was approximately HK$766,000 in 2022, a significant decrease from HK$169,558,000 in 2021[15]. - The economic environment remains sluggish due to the lingering effects of the COVID-19 pandemic, impacting overall business activities[14]. Strategic Direction - The Group adopted a more conservative strategy in property development and investment due to the uncertain real estate market in the PRC[20]. - The Group plans to continue identifying and exploring business opportunities in the natural gas sector both in the PRC and globally[20]. - The Group's management is focused on navigating the challenges posed by the pandemic while seeking growth opportunities in its core sectors[20]. - The Group's strategic adjustments reflect a response to the ongoing market disruptions caused by the COVID-19 outbreak[20]. Capital Structure and Financial Position - The Group's capital structure includes debt, cash and bank balances, and equity attributable to owners, which comprises issued share capital and reserves[35]. - A capital reorganization was approved, involving share consolidation, capital reduction, and share subdivision to enhance the capital structure[36][40]. - The share consolidation involved consolidating every ten issued shares of par value HK$0.05 into one consolidated share of par value HK$0.5[36]. - As of December 31, 2022, the underlying current ratio was approximately 0.12, a decrease from 0.55 in 2021[46]. - The equity attributable to owners of the Company was a deficit of approximately HK$(315,683,000), an increase of approximately 290% from the deficit of HK$(80,917,000) at the end of 2021[47]. - The net current liabilities as of December 31, 2022, were approximately HK$402,555,000, compared to HK$173,265,000 in 2021[47]. - Cash and bank balances at December 31, 2022, were approximately HK$2,347,000, up from HK$1,862,000 in 2021[47]. - The underlying gearing ratio was approximately (30%) as of December 31, 2022, compared to (81%) in 2021[46]. - The current liabilities to total assets ratio was approximately 573% as of December 31, 2022, compared to 159% in 2021[46]. Governance and Board Structure - The Board held a total of 2 board meetings during the financial year, with a 100% attendance rate from all directors[85]. - As of December 31, 2022, independent non-executive directors represented at least one-third of the Board, complying with Rule 3.10A of the Listing Rules[90]. - The Company has appointed at least three independent non-executive directors, with one possessing appropriate professional qualifications in accounting or related financial management expertise[90]. - The Board is committed to ensuring independent views and input are available, with independent professional advice obtained at the Company's expense[79]. - The Company has established mechanisms to ensure that all directors have access to timely information, including monthly updates on business operations[88]. - The Board will review the implementation and effectiveness of governance mechanisms on an annual basis[79]. - The Company has not established an internal audit function, as the Board believes it is unnecessary given the current scale and complexity of the business[73]. - The Board aims to comply with the Code provision C.5.1, which stipulates that board meetings should be held at least four times a year[87]. Risk Management and Internal Controls - The Board conducts an annual review of significant risks, including ESG risks, and assesses the Company's ability to respond to changes in the business environment[178]. - The management is responsible for the ongoing monitoring of the risk management and internal control systems, which are reviewed annually for effectiveness[180]. - The risk management procedures are designed to identify, evaluate, and manage significant risks associated with the Group's business[184]. - The Group's risk management strategies include risk retention, avoidance, sharing, and transfer to mitigate potential losses[188]. - The internal control systems aim to reduce risks and provide reasonable assurance against material misstatement or loss[186]. - The Board considers the risk management and internal control systems to be reasonably effective and adequate for the year ended December 31, 2022[189]. Compliance and Policies - The Group has implemented a Whistleblowing Policy to allow confidential reporting of concerns related to possible improprieties[191]. - An Anti-Bribery and Anti-Corruption Policy has been adopted to outline guidelines and responsibilities for employees to resist fraud[192]. - The Group maintains awareness of confidentiality regarding inside information and complies with relevant regulations for its dissemination[190]. - The company has adopted an Anti-Bribery and Anti-Corruption Policy to prevent and address any form of bribery and corruption among employees and third parties[194]. - The Board and the Audit Committee will periodically review the effectiveness of the Anti-Bribery and Anti-Corruption Policy to ensure compliance and commitment to prevention and investigation[196]. Human Resources and Diversity - The Group had approximately 14 staff as of December 31, 2022, with remuneration based on performance and industry practices to retain talent[30]. - The Group employed 14 individuals during the financial year, with 50% being female, indicating achievement of gender diversity[100]. - The Board currently has one female director, and the Company aims to increase the proportion of female members over time[98]. - All directors participated in continuous professional development programs during the year, ensuring their contributions remain informed and relevant[105].

Financial Performance - The Group's revenue for the year ended December 31, 2022, was approximately HK$2,715,000, a decrease from approximately HK$3,157,000 for the year ended December 31, 2021, representing a decline of about 14%[22] - The loss attributable to owners of the Company for the year ended December 31, 2022, was approximately HK$227,735,000, compared to a loss of approximately HK$581,677,000 for the year ended December 31, 2021, indicating a reduction in loss by approximately 61%[22] - The loss arising on change in fair value of investment properties was approximately HK$3,393,000 in 2022, down from approximately HK$24,944,000 in 2021, reflecting a decrease of about 86%[22] - The impairment loss recognized in respect of property, plant, and equipment was HK$Nil in 2022, significantly improved from HK$113,999,000 in 2021[22] - The impairment loss recognized in respect of financial assets under expected credit losses model amounted to approximately HK$177,609,000 in 2022, compared to HK$192,300,000 in 2021, showing a decrease of about 8%[22] - The share of losses of associates was approximately HK$766,000 in 2022, a significant reduction from HK$169,558,000 in 2021[22] Impact of COVID-19 - The COVID-19 pandemic has had a negative impact on the Group's business operations during the financial year ended December 31, 2022, contributing to deteriorating macroeconomic conditions[21] - The Group's financial performance was affected by various precaution measures implemented by government authorities, including travel restrictions and business limitations due to the COVID-19 pandemic[21] - The Company continues to face challenges in the current economic environment, which may impact future performance and strategic decisions[21] Corporate Governance - The Company is committed to enhancing corporate governance practices to maximize shareholder value[70] - The Company complied with all code provisions of the Corporate Governance Code for the year ended December 31, 2022, with some deviations noted[71] - The roles of chairman and chief executive officer are held by the same individual, which the Board believes ensures consistent leadership[72] - The company complied with all provisions of the Corporate Governance Code, except for the insurance arrangement for directors, which was deemed unnecessary due to minimal risk of significant legal claims[74] - The Board held a total of two meetings during the financial year, with all directors achieving a 100% attendance rate[92] - The company does not currently have an internal audit function, as the Board believes there is no immediate need based on the size and complexity of the business[80] - The Board consists of three executive directors and three independent non-executive directors, with one having the required professional qualifications in accounting[84] - All directors confirmed compliance with the Model Code regarding securities transactions from the listing date until December 31, 2022[78] - The company’s articles of association require all directors to retire by rotation at least once every three years, ensuring regular re-evaluation of board members[85] - The Board has mechanisms in place to ensure independent views are available, including encouraging participation from independent non-executive directors[86] - The company’s governance structure aims to protect the interests of all shareholders through sound internal control and risk management systems[87] - The Board will review the effectiveness of its governance mechanisms annually to ensure continued compliance and effectiveness[86] - The company believes that the current arrangement of having the same individual serve as both Chairman and CEO enhances leadership consistency and strategic planning[74] - The Board did not hold the required four meetings during the year due to delays in financial results publication and trading suspension[94] - Independent non-executive directors (INEDs) represented at least one-third of the Board as of December 31, 2022, in compliance with listing rules[97] - The Company has a commitment to gender diversity, currently having one female director, with plans to increase this proportion over time[105] - The Group employed 14 individuals, with 50% being female, indicating achievement of gender diversity in its workforce[107] - All Directors participated in continuous professional development programs during the year, ensuring their contributions remain informed and relevant[112] - The Board Diversity Policy aims to achieve a balance of skills, experience, and perspectives to enhance decision-making effectiveness[101] - The Nomination Committee will review the Board Diversity Policy and measurable objectives at least annually to ensure effectiveness[106] - The Company has received annual confirmations of independence from each INED as required under listing rules[98] - The Board has a balanced mix of knowledge and skills, including business management, finance, and civil engineering[105] - The Company will strive to comply with the Code provision C.5.1 regarding regular board meetings going forward[94] - The roles of chairman and chief executive officer are held by the same individual, Mr. XU Xiao Jun, which the Board believes ensures consistent leadership and effective strategic planning[121] - The Board reserves decision-making on major matters, including overall strategies, budgets, and financial information, ensuring corporate governance principles are upheld[122] - The Remuneration Committee, chaired by an independent non-executive Director, reviewed remuneration packages based on individual performance and Group profitability during the financial year[130] - The Nomination Committee is responsible for recommending Director appointments and evaluating board composition, considering factors such as gender, age, and professional experience[136] - The Nomination Policy has been adopted to outline the selection criteria and procedures for identifying and recommending candidates for Directors[140] - The Board comprises experienced individuals, including a sufficient number of independent non-executive Directors, to maintain a balance of power and authority[121] - No meetings were held for the Remuneration Committee or Nomination Committee during the financial year, indicating a potential area for improvement in governance practices[131][137] - The daily management and operations of the Group are delegated to senior management, with significant transactions requiring Board approval[123] - The Board has established internal committees, including remuneration, nomination, audit, and corporate governance committees, to ensure compliance with governance standards[124] - The Remuneration Committee ensures that no Director is involved in deciding their own remuneration, providing protection to shareholders[129] - As of December 31, 2022, all members of the Audit Committee were Independent Non-Executive Directors (INEDs), with one member possessing appropriate professional qualifications and financial management expertise[146] - The Audit Committee held one meeting during the financial year, with a 100% attendance rate from all members[150][153] - The Corporate Governance Committee consisted of four members as of December 31, 2022, including three INEDs and one executive director[154] - The Corporate Governance Committee is responsible for developing and reviewing the Company's corporate governance policies and practices[155] Financial Position and Strategies - The Group's capital structure includes debt, cash and bank balances, and equity attributable to owners of the Company[42] - As of December 31, 2022, the underlying current ratio was approximately 0.12, a decrease from 0.55 in 2021[53] - The underlying gearing ratio was approximately (30%) as of December 31, 2022, compared to (81%) in 2021[53] - The equity attributable to owners of the Company was a deficit of approximately HK$(315,683,000), an increase of approximately 290% from the previous year's deficit of HK$(80,917,000)[54] - Net current liabilities as of December 31, 2022, were approximately HK$402,555,000, up from HK$173,265,000 in 2021[54] - Cash and bank balances at December 31, 2022, were approximately HK$2,347,000, compared to HK$1,862,000 in 2021[54] - The Group had no material contingent liabilities other than a loan obligation of approximately HK$90,248,000 secured by properties of a subsidiary[57] - The Board resolved not to propose any final dividend for the year ended December 31, 2022[62] - The Company is actively negotiating to repay outstanding liabilities and is collecting account receivables to improve its financial position[174] - The Company plans to enforce cost-saving measures to minimize expenses, including administrative and operating costs[175] - The Group is exploring potential fundraising activities such as rights issues and the issuance of new shares or convertible bonds[177] - The Directors believe that if the above measures are successfully implemented, the Group will have sufficient cash resources for future working capital needs[178] - The Audit Committee has reviewed and agreed with the management's position regarding the going concern and liquidity issues[179] - The Company aims to expand its existing business internationally to improve operating results and cash flow[170] - The Group is actively seeking fundraising opportunities, including rights issues, placements of new shares, and/or convertible bonds, depending on current market conditions and business development[183] - The Board believes that successful implementation of fundraising measures will improve the Group's financial position, ensuring sufficient cash resources for future operational and financial needs[183] - As of December 31, 2022, the consolidated financial statements were prepared on a going concern basis, supported by the Board's detailed plans regarding liquidity and operational continuity[183] Risk Management and Internal Controls - The Audit Committee continuously reviews significant risk management and internal controls, ensuring adequacy of resources and qualifications of staff in accounting and financial reporting functions[186] - The Group's risk management procedures are designed to identify, evaluate, and manage significant risks, including ESG risks, with annual reviews conducted by the Board[191] - The internal control systems aim to reduce business-related risks and minimize adverse impacts, providing reasonable assurance against material misstatements or losses[193] - The Group has established a Whistleblowing Policy to allow employees and third parties to report concerns confidentially regarding possible improprieties[198] - The Board adopted an Anti-Bribery and Anti-Corruption Policy, outlining guidelines and responsibilities for employees to resist fraud and report suspected cases[199] - The risk management and internal control systems were deemed reasonably effective and adequate for the year ended December 31, 2022, covering all material controls[196] - The Group's risk management strategies include risk retention, avoidance, sharing, and transfer to mitigate potential losses[195] - The group has enhanced awareness of insider information confidentiality and regularly notifies relevant directors and employees about trading restrictions[200] - A whistleblowing policy has been adopted by the board to provide guidance and reporting channels for employees and third parties to report concerns about misconduct confidentially[200] - All reported matters will undergo independent investigation, ensuring confidentiality for whistleblowers[200] - The board and audit committee will regularly review the whistleblowing policy and mechanisms to improve effectiveness[200]

Financial Performance - The loss attributable to owners of the Company for the period from January 1, 2022, to June 30, 2022, was approximately HK$21,703,000, compared to a loss of approximately HK$1,336,000 for the first six months of 2021[16]. - Revenue for the six months ended June 30, 2022, was HK$1,572,000, a decrease of 90.66% compared to HK$16,859,000 for the same period in 2021[87]. - Loss before tax for the six months ended June 30, 2022, was HK$21,794,000, compared to a loss of HK$1,297,000 in the previous year, indicating a significant increase in losses[87]. - Total comprehensive expenses for the period amounted to HK$24,322,000, a stark contrast to a total comprehensive income of HK$7,999,000 in the prior year[89]. - The company's total equity attributable to owners decreased to HK$105,527,000 from HK$80,917,000 at the end of 2021, highlighting a decline in shareholder equity[92]. Financial Position - As of June 30, 2022, the underlying current ratio was approximately 0.53, a slight decrease from 0.55 on December 31, 2021[30]. - The underlying gearing ratio was approximately (69%) as of June 30, 2022, improving from (81%) on December 31, 2021[30]. - Net current liabilities were approximately HK$195,524,000 as of June 30, 2022, up from HK$173,265,000 on December 31, 2021[31]. - The company’s accumulated losses increased to HK$1,043,074,000 as of June 30, 2022, compared to HK$1,021,371,000 at the beginning of the year[93]. - The Group had net liabilities of approximately HK$166,662,000, with interest-bearing borrowings amounting to approximately HK$115,000,000[106]. Business Operations - The Group's property rental business includes a property in Tianjin with a land use area of 11,331.30 square meters, providing a steady rental income stream[17]. - The Group is engaged in property development with a land area of approximately 29,012.72 square meters in Tianjin, where two 4-storey buildings with a total gross floor area of 18,333 square meters are under construction[23]. - The Group's business operations were affected by COVID-19 lockdown measures and a downturn in the property market in 2022[106]. - The Group aims to explore business opportunities in the natural gas sector not only in the PRC but also globally to further develop this business[24]. - The Group aims to identify and explore growth opportunities in the natural gas business both in China and globally[27]. Governance and Compliance - The Company has complied with all provisions of the Corporate Governance Code for the six months ended June 30, 2022, except for certain deviations regarding insurance cover for directors[74]. - The Audit Committee has reviewed the unaudited condensed consolidated financial statements for the six months ended June 30, 2022, with no disagreements noted[82]. - The Company did not have an internal audit function as of the report date, citing the current effectiveness of its internal control system[76]. - The roles of Chairman and Chief Executive Officer are held by the same individual, which the Board believes ensures consistent leadership[75]. Share Capital and Structure - A capital reorganisation was approved on January 24, 2022, involving share consolidation, capital reduction, and share sub-division[62]. - The share consolidation involved consolidating every ten issued shares of par value HK$0.05 into one consolidated share of par value HK$0.50[62]. - The capital reduction will reduce the par value of each issued consolidated share from HK$0.50 to HK$0.01 by cancelling HK$0.49 of paid-up capital[67]. - The share sub-division will subdivide each authorised but unissued consolidated share into fifty ordinary shares with par value HK$0.01 each[68]. - As of the report date, the capital reduction and share sub-division have not yet become effective[69]. Cash Flow and Liquidity - Cash and bank balances increased to approximately HK$3,575,000 as of June 30, 2022, compared to HK$1,862,000 at the end of 2021[31]. - The company is actively negotiating to repay outstanding liabilities and is working to collect accounts receivable to improve its financial position[111][116]. - Cost-saving measures are being implemented to minimize expenses, including administrative and operating costs[112][117]. - Potential fundraising activities are being sought, including rights issues and the issuance of new shares or convertible bonds, depending on market conditions[114][119]. - The directors believe that if the above measures are successfully implemented, the group will have sufficient cash resources to meet future working capital and financial needs[115]. Segment Performance - For the six months ended June 30, 2022, total revenue amounted to HK$1,572,000, with property management services contributing HK$647,000 and leases contributing HK$925,000[140]. - The Group's revenue from property management services in the PRC for the six months ended June 30, 2022, was HK$647,000, recognized over time[138]. - The total revenue from the property investment segment for the six months ended June 30, 2022, was HK$1,572,000, with all revenue recognized over time[140]. - The segment profit for the same period in 2022 was HK$1,395,000, compared to HK$933,000 in 2021, indicating a year-over-year increase of 49.5%[148]. - Other income, gains, and losses totaled HK$18,019,000 in 2022, slightly up from HK$18,003,000 in 2021, reflecting a marginal increase of 0.09%[150].

Financial Performance - The loss attributable to owners of the Company for the period from January 1, 2022, to June 30, 2022, was approximately HK$21,703,000, compared to a loss of approximately HK$1,336,000 for the first six months of 2021[21]. - Revenue for the six months ended June 30, 2022, was HK$1,572,000, a significant decrease of 90.66% compared to HK$16,859,000 in 2021[92]. - Loss before tax for the period was HK$21,794,000, compared to a loss of HK$1,297,000 in the previous year, indicating a substantial increase in losses[92]. - Total comprehensive expenses for the period amounted to HK$24,322,000, a stark contrast to a comprehensive income of HK$7,999,000 in the prior year[94]. - The Company incurred finance costs of HK$35,392,000, a significant rise from HK$5,774,000 in the previous year, indicating increased borrowing costs[92]. Financial Position - The Group's consolidated financial statements for the six months ended June 30, 2022, are unaudited and condensed, with detailed financial information provided on pages 15 to 40 of the report[20]. - The Group's financial position as of June 30, 2022, is detailed in the consolidated statement of financial position included in the report[20]. - As of June 30, 2022, the Group's current ratio was approximately 0.53, a slight decrease from 0.55 on December 31, 2021[35]. - The Group's deficit attributable to owners increased by approximately 30% to HK$105,527,000 from HK$80,917,000 at the end of the previous year[36]. - Current liabilities increased to HK$415,808,000 from HK$382,524,000, resulting in net current liabilities of HK$195,524,000[97]. Operational Insights - The interim report was presented by the Board of Directors, highlighting the financial results and operational insights for the first half of 2022[23]. - The Company continues to focus on its core business operations while navigating the challenges posed by the market environment[24]. - The financial performance reflects the ongoing impact of external factors affecting the infrastructure investment sector[24]. - The business operations were affected by COVID-19 lockdown measures and a downturn in the property market in the PRC[111]. - The Group's existing business is operating as usual, with efforts to improve operating results and cash flows[112]. Strategic Initiatives - The Company is committed to enhancing its operational efficiency and exploring new opportunities for growth in the infrastructure sector[24]. - The Group is adopting a more conservative strategy in property development and investment due to the uncertain real estate market in China[29]. - The Group plans to explore business opportunities in the natural gas sector both in China and globally[29]. - The Directors are taking measures to manage liquidity needs and improve financial position, including focusing on existing businesses and international expansion[112]. - The company is actively negotiating to repay outstanding liabilities and collect accounts receivables to improve its financial position[116][121]. Share Capital and Governance - The capital reorganisation approved on January 24, 2022, involved a share consolidation where every ten issued shares of par value HK$0.05 were consolidated into one share of par value HK$0.50[67]. - The capital reduction will reduce the par value of each issued consolidated share from HK$0.50 to HK$0.01 by cancelling HK$0.49 of paid-up capital on each issued consolidated share[72]. - The company has complied with all provisions of the Corporate Governance Code for the six months ended June 30, 2022, except for certain deviations regarding insurance cover for directors and the separation of roles between the chairman and CEO[79][80]. - The Audit Committee, consisting of three independent non-executive Directors, has reviewed the financial reporting process and internal control system, with no disagreements noted on the unaudited condensed consolidated financial statements for the six months ended June 30, 2022[86][87]. - The company has adopted the Model Code for Securities Transactions by Directors and confirmed compliance for the six months ended June 30, 2022[85][88]. Assets and Liabilities - The Group had net liabilities of approximately HK$166,662,000, with interest-bearing borrowings amounting to approximately HK$115,000,000[111]. - Trade receivables as of June 30, 2022, amounted to HK$138,208,000, with a net amount of HK$51,494,000 after an allowance for credit losses of HK$86,714,000[171]. - The Group's interest-bearing borrowing was secured by pledged shares held by a substantial shareholder, Mr. Ye De Chao, and was personally guaranteed by him[191]. - The Group's contingent liabilities included a financial guarantee contract for a loan of approximately HK$93,712,000 as of June 30, 2022, down from HK$97,960,000 in 2021[196]. - The Group had no other material contingent liabilities as of June 30, 2022, compared to none in 2021[200].

Financial Performance - The Group's revenue for the year ended December 31, 2021, was approximately HK$3,157,000, a significant decrease from approximately HK$127,414,000 for the year ended December 31, 2020, representing a decline of about 97.5%[14]. - The loss attributable to owners of the Company for the year ended December 31, 2021, was approximately HK$581,677,000, compared to a loss of approximately HK$278,857,000 for the previous year, indicating an increase in loss of about 108.7%[14]. - The increase in loss was primarily due to a fair value loss on investment properties amounting to approximately HK$24,944,000 and an impairment loss on property, plant, and equipment of approximately HK$113,999,000[35]. - The loss from changes in fair value of investment properties was approximately HK$24,944,000 in 2021, down from approximately HK$77,966,000 in 2020[14]. - Impairment losses recognized in respect of property, plant, and equipment amounted to approximately HK$113,999,000 in 2021, compared to HK$87,937,000 in 2020, reflecting an increase of about 29.7%[14]. - Impairment losses recognized for financial assets under the expected credit losses model were approximately HK$192,300,000 in 2021, significantly higher than HK$40,723,000 in 2020, marking an increase of about 371.5%[14]. - The share of losses of associates was approximately HK$169,558,000 in 2021, compared to HK$144,569,000 in 2020, representing an increase of about 17.3%[14]. Strategic Direction - The Group adopted a more conservative view and strategy in property development and investment due to the uncertain real estate market in the PRC caused by the COVID-19 pandemic[19]. - The Group plans to continue identifying and exploring business opportunities in the natural gas sector both in the PRC and globally to further develop this business[19]. Liquidity and Financial Position - The underlying current ratio as of December 31, 2021, was approximately 0.55, a decline from 1.72 in 2020, indicating liquidity challenges[39]. - The underlying gearing ratio was approximately (81%) as of December 31, 2021, compared to 24% in 2020, reflecting a significant increase in debt relative to equity[39]. - The equity attributable to owners of the Company was a deficit of approximately HK$80,917,000 as of December 31, 2021, a decrease of approximately 117% from HK$483,087,000 at the end of the previous year[40]. - The net current liabilities as of December 31, 2021, were approximately HK$173,265,000, compared to net current assets of HK$153,450,000 in 2020[40]. - As of December 31, 2021, the Group's current liabilities exceeded its current assets by approximately HK$173,265,000, resulting in net liabilities of approximately HK$142,340,000[162]. - Cash and cash equivalents were only approximately HK$1,862,000 as of the reporting date[162]. Corporate Governance - The company has complied with all provisions of the Corporate Governance Code for the year ended December 31, 2021, except for certain deviations regarding insurance for directors and the separation of roles between the chairman and CEO[66][67]. - The Board of Directors consists of three executive directors and three independent non-executive directors, with two independent directors having served for over nine years and eligible for re-election[76]. - The company does not currently have an internal audit function, as the Board believes there is no immediate need based on the size and complexity of the business[71][74]. - The company is committed to maximizing shareholder value and enhancing transparency, accountability, and independence[65][68]. - The Board meets regularly to monitor performance and ensure compliance with statutory and regulatory requirements[79]. - Independent non-executive directors are encouraged to participate actively in Board meetings and have access to independent professional advice[78]. - The company will review its corporate governance practices periodically to improve effectiveness[65][68]. - The Board Diversity Policy aims to achieve a balanced mix of skills, experience, and perspectives among board members to enhance decision-making effectiveness[93]. - The Company has established mechanisms to ensure independent opinions and information are provided to the Board, particularly from independent non-executive directors[82]. - The Board is satisfied that the other commitments of the INEDs do not conflict with their duties as directors[90]. - The nomination committee will review the Board Diversity Policy and measurable objectives at least annually to ensure its effectiveness[99]. - The Company provides newly appointed directors with an induction package to ensure they understand the business and their responsibilities under the Listing Rules[101]. Risk Management - The Board reviewed significant risks, including ESG risks, and the Company's ability to respond to changes in the business environment[184]. - The management is responsible for the ongoing design and implementation of the risk management and internal control systems, which are reviewed annually for effectiveness[186]. - The Group has established procedures to identify and manage significant risks, with annual reviews conducted by the Board[187]. - The risk management strategies include risk retention, avoidance, sharing, and transfer to mitigate potential losses[195]. - The internal control systems aim to reduce business-related risks and provide reasonable assurance against material misstatements[191]. - Significant internal control deficiencies are reported to the Board promptly to ensure timely remediation[192]. - The Board considers the risk management and internal control systems to be reasonably effective and adequate for the year ended December 31, 2021[193]. - The Group has adopted a Whistleblowing Policy to allow confidential reporting of concerns related to possible improprieties[197]. - The Anti-Bribery and Anti-Corruption Policy outlines guidelines and responsibilities to prevent and report fraud and corruption[198]. Employee and Gender Diversity - The Group had approximately 14 staff members as of December 31, 2021, with remuneration based on performance and industry practices[34]. - The Company has a commitment to gender diversity, currently having one female director, with plans to increase this proportion over time[98]. - The Group employed 14 individuals during the financial year, with approximately 50% being female, indicating a commitment to gender diversity in recruitment[100]. - The company maintains a commitment to diversity in its hiring practices, reflecting its broader corporate governance principles[103]. Audit and Financial Oversight - The Audit Committee consists entirely of Independent Non-executive Directors (INEDs) as of December 31, 2021[138]. - The chairman of the Audit Committee, Mr. HE Jin Geng, is a qualified accountant with relevant financial experience[138]. - The Audit Committee reviews the Company's financial reports and internal controls[137]. - The Audit Committee continuously monitors the adequacy of resources and qualifications of the Group's accounting and internal audit functions[185]. - All members of the Audit Committee are independent non-executive directors, ensuring unbiased oversight[140]. - The audit fees for the year ended December 31, 2021, were HK$820,000 for HLB Hodgson Impey Cheng Limited and HK$950,000 for Asian Alliance (HK) CPA Limited, compared to HK$1,000,000 for the previous year[155]. - The Company’s audit fees for non-audit services were nil for both 2021 and 2020[155]. Future Plans and Measures - The Company is exploring various business opportunities to increase cash inflow and improve its financial position[167]. - The Group is actively negotiating to repay outstanding liabilities and collect account receivables[168]. - Cost-saving measures are being enforced to minimize expenses, including administrative and operating costs[169]. - The Company is in negotiations for potential loan capitalisation to reduce debt and increase the shareholder base[175]. - The Group is seeking fundraising opportunities such as rights issues and placements of new shares, depending on market conditions[176]. - The consolidated financial statements for the year ended December 31, 2021, have been prepared on a going concern basis, assuming successful implementation of the above measures[177].

Financial Performance - The Group's revenue for the year ended December 31, 2021, was approximately HK$3,157,000, a significant decrease from approximately HK$127,414,000 for the year ended December 31, 2020, representing a decline of about 97.5%[21]. - The loss attributable to owners of the Company for the year ended December 31, 2021, was approximately HK$581,677,000, compared to a loss of approximately HK$278,857,000 for the previous year, indicating an increase in loss of about 108.7%[21]. - The loss arising on change in fair value of investment properties amounted to approximately HK$24,944,000, down from approximately HK$77,966,000 in 2020[21]. - The impairment loss recognized in respect of property, plant, and equipment was approximately HK$113,999,000, an increase from HK$87,937,000 in 2020[21]. - The impairment loss recognized in respect of financial assets under expected credit losses model was approximately HK$192,300,000, compared to HK$40,723,000 in 2020, reflecting a significant increase[21]. - The share of losses of associates amounted to approximately HK$169,558,000, up from HK$144,569,000 in 2020[21]. - The underlying current ratio as of December 31, 2021, was approximately 0.55, a decrease from 1.72 in 2020, reflecting a decline in liquidity[46]. - The Group's equity attributable to owners of the Company was a deficit of approximately HK$80,917,000, a decrease of approximately 117% from HK$483,087,000 at the end of the previous year[47]. - The net current liabilities as of December 31, 2021, were approximately HK$173,265,000, compared to net current assets of HK$153,450,000 in 2020[47]. - Cash and cash equivalents were only approximately HK$1,862,000 as of December 31, 2021[169]. Impact of COVID-19 - The COVID-19 pandemic has negatively impacted the Group's business activities and contributed to deteriorating macroeconomic conditions during the financial year[20]. - The Company has continued to face challenges due to government-imposed restrictions and lockdowns affecting business operations[20]. - The Group's overall performance has been negatively impacted by the COVID-19 pandemic, leading to a conservative approach in its business strategies[26]. - The Group adopted a more conservative view and strategy in property development and investment due to the uncertain atmosphere in the PRC real estate market caused by the ongoing COVID-19 pandemic[26]. - The Group will adopt a more conservative view and strategy regarding property development and investment due to the ongoing economic challenges posed by COVID-19[42]. Corporate Governance - The Company has complied with all provisions of the Corporate Governance Code for the year ended December 31, 2021, except for certain deviations regarding insurance cover for directors and the separation of roles between the chairman and CEO[73]. - The Board comprises three executive directors and three independent non-executive directors, with two independent directors having served for more than nine years and subject to re-election[80]. - The Company does not currently have an internal audit function, as the Board believes there is no immediate need based on the size and complexity of the business[78]. - The Company is committed to maximizing shareholder value and enhancing transparency, accountability, and independence[72]. - The Board has a range of necessary skills and experiences to discharge their duties effectively[84]. - The Company will review its corporate governance practices regularly to improve effectiveness[72]. - The Board held a total of four board meetings during the financial year, with a 100% attendance rate for all directors[92]. - Independent non-executive directors (INEDs) represented at least one-third of the Board as of December 31, 2021, in compliance with Listing Rules[96]. - The Company has mechanisms in place to ensure independent views are available to the Board, including obtaining independent professional advice[89]. - The Board conducts regular and ad hoc meetings to monitor senior management performance and ensure compliance with statutory requirements[90]. Risk Management - The Board reviewed significant risks, including ESG risks, and the Company's ability to respond to changes in the business environment[191]. - The management is responsible for the ongoing design and monitoring of the risk management and internal control systems, which are reviewed annually for effectiveness[193]. - The Group has established procedures to identify and manage significant risks, with annual reviews conducted by the Board[194]. - The management identifies risks by considering internal and external factors, assessing and prioritizing them based on impact and occurrence[197]. - The internal control systems aim to reduce risks and minimize adverse impacts, providing reasonable assurance against material misstatement[198]. - Significant internal control deficiencies are reported to the Board for prompt remediation actions[199]. - For the year ended December 31, 2021, the risk management and internal control systems were deemed reasonably effective and adequate[200]. Business Strategy - The Group plans to continue identifying and exploring thriving business opportunities in the natural gas sector both in the PRC and globally to further develop this business area[26]. - The Company is exploring various business opportunities to increase cash inflow and improve its financial position[174]. - The Group is actively negotiating to repay outstanding liabilities and collect account receivables[175]. - Cost-saving measures are being enforced to minimize expenses, including administrative and operating costs[176]. - The Company is in negotiations regarding potential debt capitalisation to reduce debt and increase the shareholder base[182]. - The Group is seeking fundraising opportunities such as rights issues and placements of new shares, depending on market conditions[183]. - The consolidated financial statements for the year ended December 31, 2021, have been prepared on a going concern basis, assuming successful implementation of the above measures[184]. Remuneration and Board Diversity - The Remuneration Committee reviewed the remuneration packages of Directors and senior management, including discretionary bonuses based on individual performance and the Group's profitability[126]. - The Remuneration Committee met once during the financial year to determine specific remuneration packages for executive Directors and senior management[127]. - The Company has a commitment to gender diversity, currently having one female director, with plans to increase this proportion over time[105]. - The Group employed 14 individuals during the financial year, with approximately 50% being female, indicating a commitment to gender diversity in recruitment[107]. - The Board Diversity Policy aims to achieve a balanced mix of skills, experience, and perspectives to enhance decision-making effectiveness[100]. - The Nomination Committee reviewed the Board Diversity Policy and measurable objectives at least annually to ensure effectiveness[106]. - The company’s diversity policy aims for gender equality on the Board, with a commitment to increasing the proportion of female members when selecting candidates[110].

Financial Performance - For the year ended December 31, 2021, the company reported a revenue of HKD 18,182,000, a decrease of 1.0% from HKD 127,414,000 in 2020[2] - The gross profit for 2021 was HKD 2,102,000, down from HKD 2,831,000 in 2020, indicating a decline of 25.8%[2] - The operating loss for 2021 was HKD (94,522,000), compared to HKD (343,677,000) in 2020, showing an improvement of 72.5%[2] - The net loss for the year was HKD (106,064,000), a reduction from HKD (348,497,000) in the previous year, representing a 69.6% decrease[3] - The basic and diluted loss per share for 2021 was HKD (19.52), compared to HKD (65.31) in 2020, reflecting a significant improvement[2] - The group reported a pre-tax loss of approximately HKD 83,344,000 for the year ended December 31, 2021, compared to a loss of HKD 278,857,000 in 2020, indicating an improvement of 70%[34] - The total segment loss before tax for the year was HKD 106,064,000, with significant contributions from financial costs and other operational losses[39] - The loss attributable to the company's owners for the year ended December 31, 2021, was approximately HKD 83,344,000, compared to a loss of HKD 278,857,000 for the previous year[55] Assets and Liabilities - Total assets as of December 31, 2021, were HKD 359,538,000, slightly down from HKD 365,585,000 in 2020[5] - The company's cash and bank balances decreased to HKD 1,862,000 from HKD 18,491,000 in the previous year, a decline of 89.9%[5] - The company's equity attributable to owners decreased to HKD 419,429,000 from HKD 483,087,000, a drop of 13.2%[5] - The total liabilities for the group amounted to HKD 221,028,000, with property investment liabilities at HKD 28,462,000 and natural gas liabilities at HKD 9,643,000[39] - The accounts receivable total for the year 2021 was HKD 157,851,000, with a provision for credit losses of HKD 51,885,000, resulting in a net accounts receivable of HKD 105,966,000[43] Revenue Sources - Total revenue from external customers for the year ended December 31, 2021, was HKD 18,182,000, with property investment contributing HKD 2,368,000 and natural gas contributing HKD 15,814,000[39] - Property management fee income increased to HKD 1,057,000 in 2021 from HKD 1,022,000 in 2020, reflecting a growth of 3.4%[18] - Sales of construction materials significantly dropped to HKD 15,814,000 in 2021 from HKD 125,097,000 in 2020, a decline of 87.3%[18] - The group recognized interest income from bank deposits of HKD 5,000 in 2021, down from HKD 307,000 in 2020, a decrease of 98.4%[18] Investment and Future Outlook - The group aims to seek investment opportunities in China to expand its portfolio of investment development projects, focusing on areas with development potential and ideal returns[52] - The group expects stable rental income from its property investments, particularly in the Tianjin area, due to the low interest rate environment and appreciation potential[50] Compliance and Governance - The company has adopted the standard code of conduct for securities trading by directors as outlined in Appendix 10 of the Listing Rules, confirming compliance for the year ended December 31, 2021[69] - The audit committee, composed of three independent non-executive directors, has reviewed the accounting principles and practices adopted by the group, discussing audit, internal control, and financial reporting procedures[70] COVID-19 Impact - The group did not recognize any government subsidies related to COVID-19 for the year ended December 31, 2021, compared to HKD 108,000 in 2020[18] - Due to COVID-19 travel restrictions and quarantine measures in certain regions of China, the annual performance audit for the year ended December 31, 2021, could not be completed[72] Shareholder Information - The group did not recommend any dividend for the year ended December 31, 2021, consistent with the previous year[31] - The board has decided not to recommend any final dividend for the year ended December 31, 2021, consistent with the previous year[67] Financial Ratios - The group has a current liquidity ratio of approximately 1.63 as of December 31, 2021, down from 1.72 in the previous year[57] - The capital debt ratio as of December 31, 2021, was approximately 29%, an increase from 24% in the previous year[57]

Financial Performance - The loss attributable to owners of the Company for the period from January 1, 2021, to June 30, 2021, was approximately HK$1,336,000, compared to a loss of approximately HK$2,495,000 for the same period in 2020[7]. - Revenue for the six months ended June 30, 2021, was HK$16,859,000, an increase of 34.5% compared to HK$12,506,000 for the same period in 2020[63]. - Gross profit for the same period was HK$1,027,000, representing a 6.3% increase from HK$966,000 in 2020[63]. - Profit from operations increased to HK$4,477,000, up 16% from HK$3,860,000 in the previous year[63]. - Loss before taxation improved to HK$1,297,000, a reduction of 46.6% compared to HK$2,429,000 in 2020[63]. - Total comprehensive income for the period was HK$7,999,000, compared to a loss of HK$19,993,000 in the prior year, indicating a significant recovery[65]. - The net translation differences on foreign operations contributed HK$7,744,000 to other comprehensive income, a notable improvement from a loss of HK$11,878,000 in 2020[65]. - The company reported a loss of HK$1,297,000, an improvement from a loss of HK$2,429,000 in the same period of 2020[65]. - The total comprehensive loss for the period was HK$18,789,000, compared to a loss of HK$19,993,000 in the previous year[74]. Property Sales and Development - As of June 30, 2021, 39,241.48 square meters of the gross floor area of the commercial building have been sold, and approximately 20,100 square meters of the gross floor area of the service apartment have been sold[9]. - The total gross floor area of the Jiangning Project is approximately 74,642.00 square meters, including a basement of approximately 14,518.00 square meters and land use rights of approximately 20,050.90 square meters[7]. - The Company is focused on property development and investment, particularly in the Jiangning Development Zone, Nanjing, Jiangsu Province, PRC[7]. - The Group anticipates greater development potential for its properties in Tianjin due to the rapid growth of the logistics and commercial sectors[14]. - The acquisition of the property by Tianjin Jun Hua Logistics is believed to have appreciation potential in value, enhancing the Group's investment portfolio[11]. Financial Position - The Group's equity attributable to owners was approximately HK$490,713,000, reflecting an increase of about 1.6% from HK$483,087,000 at the end of the previous year[16]. - The underlying current ratio was approximately 1.71 as of June 30, 2021, compared to 1.72 on December 31, 2020[16]. - The underlying gearing ratio was approximately 23% as of June 30, 2021, down from 24% at the end of the previous year[16]. - The net current assets were approximately HK$159,497,000 as of June 30, 2021, compared to HK$153,450,000 on December 31, 2020[16]. - The Group's total assets less current liabilities increased to HK$493,736,000 as of June 30, 2021, up from HK$485,912,000 at the end of 2020[67]. - Current assets amounted to HK$385,211,000, reflecting an increase from HK$365,585,000 at the end of 2020[67]. - The Group's total equity as of June 30, 2021, was HK$780,118,000, a slight decrease from HK$800,111,000 at the beginning of the year[74]. Cash Flow and Liquidity - The Group's cash and bank balances decreased to approximately HK$2,982,000 as of June 30, 2021, from HK$18,491,000 at the end of the previous year[16]. - For the six months ended June 30, 2021, the net cash used in operating activities was HK$15,847,000, a significant decrease compared to HK$168,414,000 generated in the same period of 2020[75]. - Cash and cash equivalents at June 30, 2021, were HK$2,982,000, a decrease from HK$159,848,000 at the same date in 2020[75]. - The Group reported a net cash generated from investing activities of HK$3,000 for the six months ended June 30, 2021, compared to HK$98,000 in 2020[75]. Shareholder Information - As of June 30, 2021, Mr. Ye De Chao holds 1,189,290,512 shares, representing 27.85% of the company's issued share capital[29]. - Central Huijin Investment Ltd. and China Construction Bank Corporation both have interests in 1,189,290,512 shares, also accounting for 27.85% of the issued share capital[37][39]. - Expert Ever Limited, owned by Zhang Xiaojun, holds 383,956,000 shares, which is 8.99% of the company's issued share capital[43]. - The total number of issued and fully paid ordinary shares remained unchanged at 4,269,910, with a nominal value of HK$213,496,000 as of June 30, 2021[119]. Operational Highlights - The Group is actively seeking investment opportunities in the PRC to expand its development portfolio and diversify income streams[14]. - The company has not disclosed any new product or technology developments in the interim report[34]. - There are no reported mergers or acquisitions in the interim report[34]. - The company continues to monitor market conditions for potential expansion opportunities[34]. - The report does not provide specific future performance guidance or outlook[34]. Expenses and Costs - General and administrative expenses increased to HK$13,453,000 from HK$8,851,000, reflecting a rise of 52.5%[63]. - Total borrowing costs decreased to HK$5,774,000 from HK$6,289,000, reflecting an 8.2% reduction[84]. - Cost of inventories sold rose to HK$15,653,000 from HK$11,370,000, indicating a 37.5% increase[87]. - The depreciation of right-of-use assets was HK$202,000, slightly up from HK$198,000 in the previous year[87]. Risks and Compliance - The Group had no material foreign exchange exposure risks during the period[19]. - The Group's PRC subsidiaries are subject to a corporate income tax rate of 25%[89]. - The Group did not provide for Hong Kong Profits Tax as there were no estimated assessable profits arising in Hong Kong during the period[89].

[Corporate Information](index=3&type=section&id=Corporate%20Information) This chapter details the company's core management, board committees, auditors, and key corporate information, noting Mr. Xu Xiaojun serves as Chairman and CEO - The company's Board of Directors comprises three executive directors and three independent non-executive directors. Mr. Xu Xiaojun serves as Chairman and Chief Executive Officer[5](index=5&type=chunk) - The company has established an Audit Committee, Remuneration Committee, Nomination Committee, and Corporate Governance Committee, with their respective chairmen and members listed[5](index=5&type=chunk) - The company's auditor is HLB Hodgson Impey Cheng Limited[7](index=7&type=chunk) [Chairman's Statement](index=5&type=section&id=Chairman's%20Statement) Despite significant revenue growth to **HKD 127 million** in 2020, the company's loss attributable to owners expanded to **HKD 279 million**, primarily due to asset impairments and associate losses, with future focus on seeking new investment opportunities in China 2020 Annual Performance Summary | Metric | 2020 (HKD) | 2019 (HKD) | | :--- | :--- | :--- | | **Revenue** | 127,414,000 | 56,935,000 | | **Loss Attributable to Owners of the Company** | 278,857,000 | 28,909,000 | - The loss in 2020 significantly increased, primarily due to: - Fair value loss on investment properties of approximately **HKD 77.89 million** - Impairment loss recognized on property, plant and equipment of approximately **HKD 87.94 million** - Impairment loss recognized on financial assets of approximately **HKD 40.72 million** - Share of loss from associates of approximately **HKD 145 million**[10](index=10&type=chunk) - The Group's principal assets include the comprehensive development project in Jiangning, Nanjing (Jiangning Project), warehouse properties of Tianjin Junhua Logistics, and industrial land and buildings under construction of Tianjin Huiliyuan, all expected to provide stable income or possess development potential[12](index=12&type=chunk)[17](index=17&type=chunk) - Future Outlook: Management will continue to seek investment projects with development potential and ideal returns in the Chinese market to expand the Group's investment portfolio[19](index=19&type=chunk)[20](index=20&type=chunk) [Management Discussion and Analysis](index=8&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Outlook](index=8&type=section&id=Business%20Review%20and%20Outlook) This section reviews the Group's property development and investment projects in China, highlighting the Jiangning project's **12%** annual return commitment and Tianjin properties' rental income potential, with a continued focus on seeking new opportunities - The Nanjing Jiangning project investment secured an annual return commitment of not less than **12%** of the consideration. On May 15, 2020, the guarantor paid the profit guarantee shortfall of **HKD 36 million** for 2019[22](index=22&type=chunk) - The Group's investments in Tianjin include Tianjin Junhua Logistics (engaged in property leasing and warehousing) and Tianjin Huiliyuan (engaged in property leasing and development), which directors believe are located in prime areas with development potential and stable rental income prospects[26](index=26&type=chunk)[27](index=27&type=chunk) - The Group will continue to seek projects with development potential and ideal returns in the Chinese market to expand its investment portfolio[33](index=33&type=chunk)[34](index=34&type=chunk) [Financial Review](index=10&type=section&id=Financial%20Review) This fiscal year saw revenue grow to **HKD 127 million**, but loss attributable to owners expanded to **HKD 279 million**, with the current ratio decreasing and gearing ratio increasing, alongside a **HKD 95.35 million** contingent liability 2020 Annual Financial Performance | Metric | 2020 (HKD) | 2019 (HKD) | | :--- | :--- | :--- | | **Revenue** | 127,414,000 | 56,935,000 | | **Loss Attributable to Owners of the Company** | 278,857,000 | 28,909,000 | Liquidity and Financial Resources (As at December 31, 2020) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | **Current Ratio** | 1.72 | 1.87 | | **Gearing Ratio** | 24% | 16% | | **Equity Attributable to Owners of the Company** | 483,087,000 HKD | 732,376,000 HKD | | **Net Current Assets** | 153,450,000 HKD | 192,475,000 HKD | | **Cash and Bank Balances** | 18,491,000 HKD | 2,024,000 HKD | - The Group has a contingent liability: certain properties of a subsidiary are pledged as collateral for a loan of approximately **HKD 95.35 million** from a China trust company to an independent third party. As at the end of 2020, the carrying value of the pledged properties was approximately **HKD 111 million**[38](index=38&type=chunk) - The Board resolved not to recommend the payment of any final dividend for the year ended December 31, 2020[44](index=44&type=chunk) [Human Resources](index=10&type=section&id=Human%20Resources) As of December 31, 2020, the Group employed approximately **29** staff in Hong Kong and China, with remuneration policies designed to retain talent based on performance and industry standards - As at December 31, 2020, the Group had approximately **29** employees[35](index=35&type=chunk) [Corporate Governance Report](index=13&type=section&id=Corporate%20Governance%20Report) [Corporate Governance Practices](index=13&type=section&id=Corporate%20Governance%20Practices) The company largely complied with the Corporate Governance Code, with deviations noted for the combined Chairman and CEO role and non-executive directors' lack of specific terms, though subject to triennial rotation - The company deviated from Corporate Governance Code provision A.2.1, where the roles of Chairman and Chief Executive Officer are held by the same person, Mr. Xu Xiaojun. The Board believes this helps ensure leadership consistency and strategic planning efficiency[49](index=49&type=chunk)[63](index=63&type=chunk) - The company deviated from Corporate Governance Code provision A.4.1, where non-executive directors do not have specific terms of office, but all directors are subject to retirement by rotation at least once every three years at the annual general meeting[49](index=49&type=chunk) [Board of Directors](index=14&type=section&id=Board%20of%20Directors) The Board, comprising three executive and three independent non-executive directors, possesses essential skills and experience, held **6** meetings with full attendance, and provided continuous professional development training 2020 Board Meeting Attendance Record | Director Name | Position | Meetings Attended/Total Meetings | Attendance Rate | | :--- | :--- | :--- | :--- | | Xu Xiaojun | Chairman and Chief Executive Officer | 6/6 | 100% | | Ye Dechao | Executive Director | 6/6 | 100% | | Ji Xudong | Executive Director | 6/6 | 100% | | He Jingeng | Independent Non-executive Director | 6/6 | 100% | | Yu Honggao | Independent Non-executive Director | 6/6 | 100% | | Chen Yang | Independent Non-executive Director | 6/6 | 100% | - All directors participated in continuous professional development courses during 2020, including attending seminars or reading relevant professional materials[60](index=60&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) [Board Committees](index=18&type=section&id=Board%20Committees) The Board has established Remuneration, Nomination, Audit, and Corporate Governance Committees, predominantly composed of independent non-executive directors, with all committees holding meetings and achieving full attendance during the year - The Remuneration Committee comprises three independent non-executive directors and one executive director, chaired by independent non-executive director Mr. Yu Honggao. The committee held one meeting during the year to review the remuneration of directors and senior management[67](index=67&type=chunk)[70](index=70&type=chunk)[73](index=73&type=chunk) - The Nomination Committee comprises three independent non-executive directors and one executive director, chaired by executive director Mr. Xu Xiaojun. The committee held one meeting during the year, completing reviews of Board structure, recommendations for re-election of directors, and assessment of independent non-executive directors' independence[74](index=74&type=chunk)[75](index=75&type=chunk)[82](index=82&type=chunk) - The Audit Committee comprises three independent non-executive directors, chaired by Mr. He Jingeng. The committee held six meetings during the year, reviewing the Group's financial reports, accounting principles, and internal control matters[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk) - The Corporate Governance Committee comprises three independent non-executive directors and one executive director, chaired by executive director Mr. Xu Xiaojun. The committee held one meeting during the year to review the company's corporate governance policies and compliance[91](index=91&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk) [Risk Management and Internal Control](index=24&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board is fully responsible for the Group's risk management and internal control systems, which management designs and implements, and external audits in 2020 found no material defects, deeming them reasonably effective - The Board is fully responsible for evaluating and determining risks, and ensuring the establishment and maintenance of effective risk management and internal control systems[100](index=100&type=chunk) - The Group has established risk management procedures, with management strategies including risk retention, avoidance, sharing, and transfer[103](index=103&type=chunk) - In fiscal year 2020, the Group engaged external consultants to perform internal audit functions, finding no material system defects. The Board considers the current system to be reasonably effective[107](index=107&type=chunk) [Shareholders' Rights & Investor Relations](index=26&type=section&id=Shareholders'%20Rights%20%26%20Investor%20Relations) The report outlines procedures for shareholders to convene extraordinary general meetings and contact the Board, emphasizing the company's commitment to transparent communication via financial reports, website, and general meetings, with all directors attending the annual general meeting - Shareholders holding not less than **10%** of the paid-up share capital may request in writing to convene an extraordinary general meeting[107](index=107&type=chunk) - The company communicates with shareholders and investors through interim and annual reports, the company website, and general meetings[110](index=110&type=chunk) [Environmental, Social and Governance Report](index=29&type=section&id=Environmental%2C%20Social%20and%20Governance%20Report) [Environmental](index=30&type=section&id=Environmental) The Group is committed to reducing its environmental impact, disclosing greenhouse gas emissions primarily from electricity and travel, implementing waste management, and promoting energy and water conservation, with limited significant environmental impact due to business nature 2020 Greenhouse Gas Emissions | Scope | Emissions (kg) | | :--- | :--- | | **Scope 2 (Indirect Emissions)** | 51,198 | | **Scope 3 (Other Indirect Emissions)** | 1,747 | 2020 Resource Consumption | Resource | Consumption | Intensity (per HKD million revenue) | | :--- | :--- | :--- | | **Electricity** | 63,322 kWh | 497 | | **Water** | 1,366 tonnes | 11 | - The Group has formulated a waste management plan, including recycling paper, printer cartridges, and batteries, and encouraging employees to reduce paper consumption[128](index=128&type=chunk) [Social](index=33&type=section&id=Social) The Group prioritizes social responsibility through competitive employee benefits and training, adhering to labor laws, prohibiting child and forced labor, ensuring a safe work environment, and reporting zero work-related injuries or fatalities in 2020 and 2019 - The Group complies with labor laws in China and Hong Kong, covering aspects such as remuneration, recruitment, working hours, and anti-discrimination, and is committed to enhancing employee diversity[138](index=138&type=chunk) Occupational Health and Safety Statistics | Metric | 2020 | 2019 | | :--- | :--- | :--- | | **Lost Days Due to Work Injury** | Zero | Zero | | **Work-Related Fatalities** | Zero | Zero | | **Number of Work Injuries** | Zero | Zero | - The Group strictly prohibits the employment of child and forced labor and has stringent recruitment procedures. No labor disputes occurred during the year[154](index=154&type=chunk) - The Group adheres to high standards of business integrity, with anti-corruption and anti-money laundering policies in place, complying with relevant laws and regulations. No related violations occurred during the year[158](index=158&type=chunk) [Directors and Senior Management](index=37&type=section&id=Directors%20and%20Senior%20Management) This chapter provides detailed biographies of executive and independent non-executive directors, outlining their experience and tenure, noting executive directors' performance-linked remuneration and independent non-executive directors' fixed fees - Executive directors include Chairman and Chief Executive Officer Mr. Xu Xiaojun, Mr. Ye Dechao, and Mr. Ji Xudong, who possess extensive experience in real estate development, corporate management, and international trade[161](index=161&type=chunk)[162](index=162&type=chunk)[166](index=166&type=chunk) - Independent non-executive directors include Mr. He Jingeng, Mr. Yu Honggao, and Ms. Chen Yang, who have professional backgrounds in financial accounting, asset management, and the securities industry, respectively[173](index=173&type=chunk)[175](index=175&type=chunk) - Executive directors are not entitled to director's fees but may receive discretionary bonuses based on contributions and company performance. In 2020, each of the three independent non-executive directors received **HKD 120,000** in director's fees[168](index=168&type=chunk)[177](index=177&type=chunk) [Directors' Report](index=41&type=section&id=Directors'%20Report) The Directors' Report outlines the company's property investment and natural gas businesses, highlighting key risks, customer concentration (largest customer **35%**, top five **98%** of revenue), director and major shareholder holdings, and a significant connected transaction related to Taihe Investment's return commitment - The company's principal business is investment holding, with an investment portfolio including (i) property investment; and (ii) natural gas business[183](index=183&type=chunk) - During the year, the largest customer accounted for approximately **35%** of total revenue, and the top five customers accounted for approximately **98%**. The largest supplier accounted for approximately **31%** of total cost of sales, and the top five suppliers accounted for **100%**[185](index=185&type=chunk) Directors' Shareholdings (As at December 31, 2020) | Director Name | Number of Shares Held | Percentage of Issued Share Capital (%) | | :--- | :--- | :--- | | Mr. Ye Dechao | 1,189,290,512 (Corporate Interest) | 27.85 | | Mr. Ji Xudong | 6,000 (Personal Interest) | 0.00014 | - Connected Transaction: Executive Director Mr. Ye Dechao, as one of the guarantors, committed to providing the Group with an annual return of not less than **HKD 36 million** for the Taihe Investment project. The compensation for 2019 was paid in May 2020. The **HKD 36 million** compensation for 2020 is due on or before May 15, 2021[210](index=210&type=chunk)[216](index=216&type=chunk) [Independent Auditors' Report](index=52&type=section&id=Independent%20Auditors'%20Report) Independent auditor HLB Hodgson Impey Cheng Limited issued an unmodified opinion on the 2020 consolidated financial statements but highlighted a material uncertainty regarding going concern due to significant losses and overdue borrowings, with key audit matters including asset valuations and recoverability of interests - Audit Opinion: The auditor believes the consolidated financial statements present fairly the Group's financial position and have been properly prepared[223](index=223&type=chunk)[225](index=225&type=chunk) - Material Uncertainty Related to Going Concern: The report draws attention to the Group's net loss of approximately **HKD 348 million** and overdue interest-bearing borrowings of approximately **HKD 115 million**, while cash balances are only approximately **HKD 18.49 million**, indicating a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern[229](index=229&type=chunk)[231](index=231&type=chunk) - Key audit matters include: - Valuation of investment properties - Impairment assessment of construction in progress under property, plant and equipment - Recoverability of the carrying amount of interests in associates[234](index=234&type=chunk)[237](index=237&type=chunk)[239](index=239&type=chunk) [Consolidated Financial Statements](index=61&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Profit or Loss](index=61&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) In 2020, Group revenue significantly increased to **HKD 127 million**, but the annual loss expanded to **HKD 348 million** (with **HKD 279 million** attributable to owners) due to fair value losses, asset impairments, and associate losses Consolidated Statement of Profit or Loss Summary (For the year ended December 31) | Item (HKD thousands) | 2020 | 2019 | | :--- | :--- | :--- | | Revenue | 127,414 | 56,935 | | Gross Profit | 2,831 | 1,905 | | Operating Loss | (343,677) | (7,226) | | Loss Before Tax | (355,914) | (30,640) | | **Loss for the Year** | **(348,497)** | **(30,074)** | | Loss Attributable to Owners of the Company | (278,857) | (28,909) | | Loss Attributable to Non-controlling Interests | (69,640) | (1,165) | | **Basic Loss Per Share** | **(6.53) cents** | **(0.68) cents** | [Consolidated Statement of Financial Position](index=63&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of December 31, 2020, total assets significantly decreased to **HKD 698 million** from **HKD 1.029 billion**, with net assets falling to **HKD 486 million** from **HKD 800 million**, primarily due to reduced non-current assets Consolidated Statement of Financial Position Summary (As at December 31) | Item (HKD thousands) | 2020 | 2019 | | :--- | :--- | :--- | | **Non-current Assets** | 332,462 | 615,628 | | **Current Assets** | 365,585 | 413,789 | | **Total Assets** | **698,047** | **1,029,417** | | **Current Liabilities** | (212,135) | (221,314) | | **Non-current Liabilities** | (296) | (7,992) | | **Total Liabilities** | **(212,431)** | **(229,306)** | | **Net Assets** | **485,616** | **800,111** | | Equity Attributable to Owners of the Company | 483,087 | 732,376 | | Non-controlling Interests | 2,529 | 67,735 | [Consolidated Statement of Cash Flows](index=67&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) In 2020, the Group generated **HKD 27.79 million** net cash from operations, a significant improvement from the prior year's outflow, with net cash and cash equivalents increasing by **HKD 11.77 million** to an ending balance of **HKD 18.49 million** Consolidated Statement of Cash Flows Summary (For the year ended December 31) | Item (HKD thousands) | 2020 | 2019 | | :--- | :--- | :--- | | **Net Cash Generated From/(Used In) Operating Activities** | 27,788 | (303,932) | | **Net Cash Generated From/(Used In) Investing Activities** | 307 | (133,846) | | **Net Cash Used In Financing Activities** | (16,322) | (107,391) | | **Net Increase/(Decrease) in Cash and Cash Equivalents** | 11,773 | (545,169) | | **Cash and Cash Equivalents at Beginning of Year** | 2,024 | 553,114 | | **Cash and Cash Equivalents at End of Year** | 18,491 | 2,024 | [Notes to the Consolidated Financial Statements](index=69&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes provide detailed explanations and supplementary information, covering material uncertainty regarding going concern, segment performance, asset impairment details, interests in associates, financial instrument risk management, and related party transactions - Material Uncertainty Related to Going Concern: Note 2(c) indicates that due to the Group's significant losses and overdue borrowings, there is a material uncertainty regarding its ability to continue as a going concern. Management has taken measures such as cost control, seeking shareholder support, and negotiating with lenders to address this[306](index=306&type=chunk)[309](index=309&type=chunk) 2020 Segment Results (HKD thousands) | Segment | Revenue | Operating Loss | | :--- | :--- | :--- | | **Property Investment** | 2,317 | (165,795) | | **Natural Gas** | 125,097 | (58,871) | | **Investment Holding** | — | (116,625) | | **Unallocated** | — | (14,623) | | **Total** | **127,414** | **(355,914)** (Before Tax) | - As at December 31, 2020, the Group recognized an impairment loss of approximately **HKD 87.94 million** on property, plant and equipment, primarily related to construction in progress[763](index=763&type=chunk) - As at December 31, 2020, the Group's interest-bearing borrowings amounted to **HKD 115 million**, all of which were secured and overdue. The Group has negotiated with lenders, who have agreed not to demand immediate repayment for the time being[878](index=878&type=chunk) [Five Years Financial Summary](index=167&type=section&id=Five%20Years%20Financial%20Summary) This summary presents the Group's key financial data over five years, showing continuous turnover growth since 2016 but consecutive losses, with **2020** having the largest loss, and declining total and net assets Five-Year Financial Summary (HKD thousands) | Year | 2020 | 2019 | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Turnover** | 127,414 | 56,935 | 56,182 | 26,144 | 15,691 | | **Loss Attributable to Owners** | (278,857) | (28,909) | (20,088) | (44,700) | (5,507) | | **Total Assets** | 698,047 | 1,029,417 | 1,143,536 | 1,243,833 | 1,407,610 | | **Total Liabilities** | (212,431) | (229,306) | (291,898) | (320,014) | (601,888) | | **Net Assets** | 485,616 | 800,111 | 851,638 | 923,819 | 805,722 | [Group Properties](index=168&type=section&id=Group%20Properties) This chapter lists the Group's principal property portfolio as of December 31, 2020, including investment properties and properties under development in Tianjin, and properties held for sale in Nanjing, with varying Group interests Group Property Portfolio (As at December 31, 2020) | Category | Location | Intended Use | Gross Floor Area (approx. sq. meters) | Group Interest (%) | | :--- | :--- | :--- | :--- | :--- | | **Investment Properties** | Tianjin Economic-Technological Development Area | Industrial properties for leasing | 11,512.07 | 51 | | **Properties Under Development** | Tianjin Economic-Technological Development Area | Industrial properties for leasing | 29,012.72 | 60 | | **Properties Held for Sale** | Jiangning District, Nanjing | Residential/Commercial properties | 116.67 | 40 | | **Properties Held for Sale** | Jiangning District, Nanjing | Residential/Commercial properties | 1,710.89 | 40 |

Financial Performance - For the six months ended June 30, 2020, the company reported a loss attributable to owners of approximately HKD 2,495,000, compared to a loss of approximately HKD 1,695,000 for the same period in 2019[10]. - Revenue for the six months ended June 30, 2020, was HKD 12,506 thousand, a decrease of 50.7% compared to HKD 25,372 thousand in 2019[44]. - Gross profit for the same period was HKD 966 thousand, slightly up from HKD 930 thousand in 2019, indicating a gross margin improvement[44]. - Operating profit decreased to HKD 3,860 thousand from HKD 10,160 thousand, reflecting a decline of 62.0% year-over-year[44]. - The company reported a loss before tax of HKD 2,429 thousand, compared to a loss of HKD 1,540 thousand in the previous year, representing a 57.8% increase in losses[44]. - Total comprehensive loss for the period was HKD 19,993 thousand, significantly higher than HKD 4,100 thousand in 2019, marking an increase of 387.5%[46]. - Basic and diluted loss per share for the period was HKD 0.06, compared to HKD 0.04 in the same period last year[44]. - The company reported a cumulative loss of HKD 163,332,000 as of June 30, 2020, compared to HKD 133,623,000 as of June 30, 2019, indicating an increase in cumulative losses[53]. Assets and Liabilities - The net asset value was approximately HKD 190,415,000, a decrease of about 1.1% from HKD 192,475,000 at the end of 2019[5]. - Cash and bank balances amounted to approximately HKD 159,848,000, significantly up from HKD 2,024,000 at the end of 2019[5]. - The total liabilities secured by properties, plants, and equipment were approximately HKD 117,675,000 as of June 30, 2020, down from HKD 119,962,000 at the end of 2019[24]. - The company's net assets as of June 30, 2020, were HKD 780,118 thousand, down from HKD 800,111 thousand at the end of 2019[50]. - The company's total assets decreased from HKD 851,638,000 as of June 30, 2019, to HKD 800,111,000 as of June 30, 2020, reflecting a decline of approximately 6.0%[53]. - The foreign exchange reserve as of June 30, 2020, was a negative HKD 92,767,000, compared to a negative HKD 58,725,000 as of June 30, 2019, indicating increased foreign exchange losses[57]. Cash Flow - The net cash generated from operating activities for the six months ended June 30, 2020, was HKD 168,414,000, compared to a net cash outflow of HKD 17,229,000 for the same period in 2019[57]. - The cash and cash equivalents as of June 30, 2020, were HKD 159,848,000, down from HKD 523,234,000 as of June 30, 2019, representing a decrease of approximately 69.5%[57]. - The net cash used in financing activities for the six months ended June 30, 2020, was HKD 184,000, compared to HKD 11,700,000 for the same period in 2019, showing a reduction in cash outflow[57]. - The company’s investment activities generated a net cash inflow of HKD 98,000 for the six months ended June 30, 2020, a decrease from HKD 833,000 in the same period of 2019[57]. Shareholder Information - Major shareholders included Central Huijin Investment Ltd. and China Construction Bank Corporation, each holding 27.85% of the issued share capital[33]. - The total issued and paid-up ordinary shares remained at 4,269,910, with a par value of HKD 0.05 as of both June 30, 2020, and December 31, 2019[94]. - The company did not recommend any interim dividend for the six months ended June 30, 2020[83]. Employee and Management - The group has approximately 26 employees in Hong Kong and China as of June 30, 2020, with compensation determined based on employee performance and industry standards[17]. - The total compensation for key management personnel during the period was HKD 448,000, consistent with the same period in 2019[96]. - The company incurred total employee costs of HKD 1,790,000, an increase from HKD 1,442,000 in the previous year[71]. Corporate Governance - The company maintained compliance with the corporate governance code, with the roles of Chairman and CEO held by the same individual to ensure consistent leadership[37]. - The audit committee, composed of three independent non-executive directors, reviewed the financial reporting process and internal controls[41]. - The company has adopted the standard code for securities transactions by directors and confirmed compliance during the reporting period[38]. Business Operations - The company aims to seek investment opportunities in China to expand its future project portfolio and diversify income streams, despite challenges posed by COVID-19[16]. - The total construction area of the Jiangning project is approximately 74,642.00 square meters, which includes about 14,518.00 square meters of basement and approximately 20,050.90 square meters of land use rights[11]. - As of June 30, 2020, approximately 1,600 square meters of commercial building area had been sold and approximately 19,600 square meters had been leased, while about 20,100 square meters of serviced apartment area had been sold[11]. - Segment revenue from property investment was HKD 1,054,000, while revenue from the natural gas segment was HKD 11,452,000[79]. - Revenue from sales of construction materials was HKD 11,452,000, down 53.2% from HKD 24,446,000 year-on-year[68]. - Property management fee income increased to HKD 437,000, up 20.4% from HKD 363,000 in the previous year[68]. - Other income, including interest from bank deposits and compensation income, totaled HKD 18,098,000, a decrease of 4.0% from HKD 18,833,000 in 2019[69]. Risk Management - The company had no significant foreign exchange risk during the period[25]. - The company’s cash and bank balances include approximately HKD 156,063,000 in RMB, highlighting the company's exposure to non-convertible currency risks[89]. - The aging analysis of trade payables indicated that as of June 30, 2020, there were HKD 25,235,000 overdue by more than 90 days, compared to HKD 29,877,000 as of December 31, 2019, showing a reduction of approximately 15%[91]. Other Information - The company reported no significant events after June 30, 2020, indicating stability in operations[97]. - The company has not adopted any new share option schemes since the expiration of the previous scheme on July 11, 2018[30].