[Company Profile and Performance Announcement](index=1&type=section&id=Company%20Profile%20and%20Performance%20Announcement) [Company General Information](index=4&type=section&id=1.1%20Company%20General%20Information) Hopefluent Group Holdings Limited is an investment holding company listed on the Hong Kong Stock Exchange, with its functional currency in RMB and financial statements in HKD - The company is an investment holding company incorporated in the Cayman Islands, with its shares listed on the Hong Kong Stock Exchange[102](index=102&type=chunk)[20](index=20&type=chunk) - The company's functional currency is RMB, but consolidated financial statements are presented in HKD[102](index=102&type=chunk) [Annual Performance Announcement](index=1&type=section&id=1.2%20Annual%20Performance%20Announcement) The company announces its audited consolidated results for the year ended December 31, 2022, including comparative figures - The company is pleased to announce its audited consolidated results for the year ended December 31, 2022[92](index=92&type=chunk) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=1&type=section&id=1.3%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the year ended December 31, 2022, the Group reported a loss of HK$748,367 thousand and total comprehensive expenses of HK$944,829 thousand Summary of Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue from continuing operations | 1,516,862 | 2,669,143 | | Loss for the year | (748,367) | (752,727) | | Total comprehensive expenses for the year | (944,829) | (656,738) | | Loss for the year attributable to owners of the company | (580,377) | (544,799) | | Loss for the year attributable to non-controlling interests | (167,990) | (207,928) | | Total comprehensive expenses for the year attributable to owners of the company | (718,777) | (493,293) | | Total comprehensive expenses for the year attributable to non-controlling interests | (226,052) | (163,445) | - Loss for the year from continuing operations was **HK$(351,001) thousand**, and loss for the period from discontinued operations was **HK$(397,366) thousand**[107](index=107&type=chunk) - Exchange differences on translation of overseas operations amounted to **HK$(144,602) thousand**, and exchange differences reclassified to profit or loss upon derecognition of discontinued operations were **HK$(51,562) thousand**[108](index=108&type=chunk) [Consolidated Statement of Financial Position](index=3&type=section&id=1.4%20Consolidated%20Statement%20of%20Financial%20Position) As of December 31, 2022, the Group's total assets less current liabilities were HK$2,559,154 thousand, net current assets were HK$1,338,037 thousand, and equity attributable to owners of the company was HK$2,227,896 thousand Summary of Consolidated Statement of Financial Position | Metric | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Non-current assets | 1,221,117 | 1,252,599 | | Current assets | 1,829,903 | 5,741,502 | | Current liabilities | 491,866 | 2,472,082 | | Net current assets | 1,338,037 | 3,269,420 | | Total assets less current liabilities | 2,559,154 | 4,522,019 | | Non-current liabilities | 325,120 | 409,542 | | Equity attributable to owners of the company | 2,227,896 | 2,946,673 | | Non-controlling interests | 6,138 | 1,165,804 | | Total equity | 2,234,034 | 4,112,477 | [Notes to the Consolidated Financial Statements](index=4&type=section&id=1.5%20Notes%20to%20the%20Consolidated%20Financial%20Statements) This section provides detailed notes to the consolidated financial statements, including general company information and the adoption of new or revised Hong Kong Financial Reporting Standards - The notes to the consolidated financial statements provide detailed financial information for the year ended December 31, 2022[114](index=114&type=chunk) [General Information](index=4&type=section&id=1.5.1%20General%20Information) The company is incorporated in the Cayman Islands, with its principal place of business located in Guangzhou, China - The company's registered office is in the Cayman Islands, and its principal place of business is in Guangzhou, China[102](index=102&type=chunk) [Adoption of Hong Kong Financial Reporting Standards](index=4&type=section&id=1.5.2%20Adoption%20of%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group adopted certain new or revised Hong Kong Financial Reporting Standards during the current accounting period, but these changes had no significant impact on the Group's results and financial position - The Hong Kong Institute of Certified Public Accountants has issued certain new or revised Hong Kong Financial Reporting Standards that are effective for the first time in the current accounting period[103](index=103&type=chunk) - These new or revised Hong Kong Financial Reporting Standards had no significant impact on the Group's results and financial position for the current or prior periods[117](index=117&type=chunk) - The directors do not anticipate that the application of these amendments and revisions in the future will have a significant impact on the consolidated financial statements[127](index=127&type=chunk) [Details of Notes to Financial Statements](index=5&type=section&id=Details%20of%20Notes%20to%20Financial%20Statements) [Revenue](index=5&type=section&id=2.1%20Revenue) The Group's total revenue for 2022 was HK$4,309,528 thousand, a significant decrease from 2021, primarily derived from agency commissions, financial services income, and interest income from loans receivable, with discontinued operations contributing a larger proportion Revenue Classification | Revenue Source | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Agency commissions from continuing operations | 1,425,835 | 2,489,400 | | Agency commissions from discontinued operations | 2,792,666 | 4,496,736 | | Financial services income | 6,223 | 56,231 | | Interest income from loans receivable | 84,804 | 123,512 | | **Total Revenue** | **4,309,528** | **7,165,879** | - Revenue primarily comprises agency commissions from property agency services, financial services income, and interest income from loans receivable[118](index=118&type=chunk) [Segment Information](index=6&type=section&id=2.2%20Segment%20Information) The Group's operating segments include property agency and financial services, with Poly Consultants Group's property agency business classified as a discontinued operation in 2022 - The Group's operating segments include property agency (providing primary and secondary property services) and financial services (providing mortgage referral and loan financing services)[120](index=120&type=chunk)[131](index=131&type=chunk) - Poly Consultants Group's property agency business was classified as a discontinued operation on March 31, 2022[131](index=131&type=chunk) [Revenue Analysis by Geographical Market](index=7&type=section&id=2.2.1%20Revenue%20Analysis%20by%20Geographical%20Market) In 2022, the majority of the Group's revenue came from China, with contributions from both continuing and discontinued operations, while Australia accounted for a smaller portion Revenue Analysis by Geographical Market | Region | Business Segment | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | :--- | | China | Continuing operations (Property agency) | 1,419,017 | 2,459,935 | | China | Continuing operations (Financial services) | 91,027 | 179,743 | | China | Discontinued operations (Property agency) | 2,792,666 | 4,496,736 | | Australia | Continuing operations (Property agency) | 6,818 | 29,465 | | **Total** | | **4,309,528** | **7,165,879** | - Comparative revenue and related segment notes have been restated as if the discontinued operations for the current year had been discontinued at the beginning of the comparative period[122](index=122&type=chunk) [Results Analysis by Operating and Reportable Segment](index=8&type=section&id=2.2.2%20Results%20Analysis%20by%20Operating%20and%20Reportable%20Segment) In 2022, the continuing property agency segment recorded a loss of HK$312,589 thousand, while the financial services segment recorded a profit of HK$22,470 thousand, and discontinued operations generated a loss of HK$153,870 thousand Results Analysis by Operating and Reportable Segment (2022) | Metric | Property Agency (Continuing Operations) (HK$ Thousand) | Financial Services (Continuing Operations) (HK$ Thousand) | Discontinued Operations (HK$ Thousand) | | :--- | :--- | :--- | :--- | | Segment revenue | 1,425,835 | 91,027 | 2,792,666 | | Segment (loss) / profit | (312,589) | 22,470 | (153,870) | | Other income | | | 8,182 | | Central administrative costs | | | | | Finance costs | | | (5,145) | | Loss before tax | | | (148,039) | Results Analysis by Operating and Reportable Segment (2021) | Metric | Property Agency (Continuing Operations) (HK$ Thousand) | Financial Services (Continuing Operations) (HK$ Thousand) | Discontinued Operations (HK$ Thousand) | | :--- | :--- | :--- | :--- | | Segment revenue | 2,489,400 | 179,743 | 4,496,736 | | Segment (loss) / profit | (227,309) | 34,236 | (125,789) | | Other income | | | 19,385 | | Central administrative costs | | | | | Finance costs | | | (5,509) | | Loss before tax | | | (86,891) | [Finance Costs and Income Tax](index=9&type=section&id=2.3%20Finance%20Costs%20and%20Income%20Tax) Finance costs for continuing operations decreased from HK$62,461 thousand in 2021 to HK$48,657 thousand in 2022, and the Group recorded an income tax expense of HK$22,169 thousand in 2022, compared to a credit of HK$112,135 thousand in 2021 Finance Costs for Continuing Operations | Source of Finance Costs | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Interest on bank borrowings | 6,053 | 885 | | Interest on other borrowings | 24,507 | 40,401 | | Interest on lease liabilities | 18,097 | 21,175 | | **Total** | **48,657** | **62,461** | Income Tax Expense / (Credit) | Tax Type | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | China corporate income tax | 8,270 | 14,602 | | Deferred tax assets | 14,933 | (131,694) | | Deferred tax liabilities | (1,034) | 4,957 | | **Total** | **22,169** | **(112,135)** | - The tax rate for Chinese subsidiaries is **25%**, for Australian entities is **30%**, and no provision for Hong Kong profits tax was made due to no assessable profits[30](index=30&type=chunk)[38](index=38&type=chunk)[39](index=39&type=chunk) [Details of Loss for the Year](index=10&type=section&id=2.4%20Details%20of%20Loss%20for%20the%20Year) Details of the loss for the year show that staff costs and depreciation expenses are major components, with a reversal of financial asset impairment in 2022 compared to recognition in 2021 Details of Loss for the Year Calculation | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Total staff costs | 1,339,405 | 2,105,550 | | Auditor's remuneration | 4,200 | 4,500 | | Depreciation expense (Property, plant and equipment) | 25,941 | 40,284 | | Depreciation expense (Right-of-use assets) | 56,163 | 70,795 | | Reversal / (recognition) of impairment for financial assets | (59,731) | 468,992 | | (Gain) / loss on disposal and write-off of property, plant and equipment | (1,016) | 238 | | Loss / (gain) on fair value changes of financial assets at fair value through profit or loss | 1,921 | (228) | | Loss / (gain) on disposal of financial assets at fair value through profit or loss | 3,107 | (2,017) | | Other losses / (gains) total net | 4,012 | (2,007) | [Dividends and Loss Per Share](index=11&type=section&id=2.5%20Dividends%20and%20Loss%20Per%20Share) The Board does not recommend any final dividend for 2022, and no interim dividend was declared; basic and diluted loss per share for continuing and discontinued operations in 2022 was 86.1 HK cents, an increase from 2021 [Dividends](index=11&type=section&id=2.5.1%20Dividends) No interim or final dividends were approved or paid in 2022 Approved and Paid Dividends | Dividend Type | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | 2022 Interim dividend (HK$0.00 per share) | – | 3,371 | | 2021 Final dividend (HK$0.00 per share) | – | 16,854 | | **Total** | **–** | **20,225** | - The Board does not recommend the payment of a final dividend for the year ended December 31, 2022[40](index=40&type=chunk)[76](index=76&type=chunk) [Loss Per Share](index=11&type=section&id=2.5.2%20Loss%20Per%20Share) Basic and diluted loss per share for continuing and discontinued operations was 86.1 HK cents in 2022 (2021: 80.8 HK cents), while loss per share from continuing operations was 36.5 HK cents (2021: 68.0 HK cents) Loss Per Share | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Basic and diluted loss per share from continuing and discontinued operations | (86.1) HK cents | (80.8) HK cents | | Basic and diluted loss per share from continuing operations | (36.5) HK cents | (68.0) HK cents | | Basic and diluted loss per share from discontinued operations | (49.6) HK cents | (12.8) HK cents | Loss and Number of Shares for Basic Loss Per Share Calculation | Item | 2022 (HK$ Thousand / Thousand Shares) | 2021 (HK$ Thousand / Thousand Shares) | | :--- | :--- | :--- | | Loss for the year attributable to owners of the company | (580,377) | (544,799) | | Less: Loss for the period from discontinued operations | 334,357 | 86,241 | | Loss from continuing operations | (246,020) | (458,558) | | Weighted average number of ordinary shares in issue | 674,150 | 674,150 | [Trade Receivables, Deposits and Payables](index=12&type=section&id=2.6%20Trade%20Receivables,%20Deposits%20and%20Payables) This section details the Group's trade receivables, deposits paid to property developers, and various payables, accrued expenses, and contract liabilities [Trade Receivables](index=12&type=section&id=2.6.1%20Trade%20Receivables) Trade receivables significantly decreased from HK$1,204,202 thousand in 2021 to HK$656,951 thousand in 2022, with notable reductions across all aging categories Aging Analysis of Trade Receivables | Aging | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | 0 to 30 days | 265,143 | 472,948 | | 31 to 60 days | 16,254 | 95,016 | | 61 to 90 days | 13,932 | 74,765 | | 91 to 120 days | 14,622 | 35,942 | | 121 to 180 days | 21,695 | 71,500 | | Over 180 days | 325,305 | 454,031 | | **Total** | **656,951** | **1,204,202** | - The average credit period granted to customers by the Group ranges from **30 to 180 days**[3](index=3&type=chunk) [Deposits](index=13&type=section&id=2.6.2%20Deposits) Deposits paid to property developers (primarily for primary market property agency services) due from non-controlling interests and their related parties decreased from HK$1,402,039 thousand in 2021 to zero in 2022, with management expecting all deposits to be settled within one year - Deposits primarily refer to amounts paid by the Group to property developers to commence property agency services[5](index=5&type=chunk) - As of December 31, 2022, deposits due from non-controlling interests and their related parties were **HK$0** (2021: HK$1,402,039,000)[5](index=5&type=chunk) - These deposits are interest-free, refundable, and unsecured, and management expects all such deposits to be settled within one year after the reporting date[5](index=5&type=chunk) [Trade Payables and Accrued Expenses](index=13&type=section&id=2.6.3%20Trade%20Payables%20and%20Accrued%20Expenses) Trade payables and accrued expenses primarily consist of accrued other taxes, operating expenses, staff costs, and other sundry creditors - Trade payables and accrued expenses primarily include accrued other taxes, operating expenses, staff costs, and other sundry creditors[6](index=6&type=chunk) [Contract Liabilities](index=13&type=section&id=2.6.4%20Contract%20Liabilities) Contract liabilities, mainly from customer prepayments for services not yet rendered, significantly decreased from HK$837,505 thousand in 2021 to HK$25,642 thousand in 2022 Third-Party Contract Liabilities | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Third-party contract liabilities | 25,642 | 837,505 | - Contract liabilities primarily arise from customer prepayments for services not yet rendered and are recognized as revenue upon satisfaction of performance obligations[7](index=7&type=chunk) [Discontinued Operations](index=14&type=section&id=2.7%20Discontinued%20Operations) The Group's Poly Consultants Group, primarily providing property agency services in China, was classified as a discontinued operation due to a reorganization agreement with Poly, and this section details the financial impact of this change - Discontinued operations refer to the business of Poly Consultants Group, primarily providing property agency services in China[131](index=131&type=chunk) [Business Reorganization](index=14&type=section&id=2.7.1%20Business%20Reorganization) The company entered into an agreement with Poly to sell the entire equity of Poly Consultants Group in exchange for Poly's 43.9% equity interest in Hopefluent China, making Hopefluent China a wholly-owned subsidiary and Poly Consultants Group ceasing to be a subsidiary on August 31, 2022 - The company entered into an agreement with Poly to conditionally agree to dispose of the entire issued share capital of Poly Consultants Group in consideration for a **43.9% equity interest** in Hopefluent China[11](index=11&type=chunk) - Upon completion of the reorganization, Hopefluent China will become an indirect wholly-owned subsidiary of the company, and Poly Consultants Group will cease to be a subsidiary of the company[11](index=11&type=chunk) - Poly Consultants Group was derecognized as a subsidiary of the company on **August 31, 2022** (the derecognition date)[12](index=12&type=chunk) [Financial Performance](index=14&type=section&id=2.7.2%20Financial%20Performance) For the period ended August 31, 2022, discontinued operations recorded a loss of HK$397,366 thousand and revenue of HK$2,792,666 thousand Calculation of Loss for the Period / Year from Discontinued Operations | Item | January 1 to August 31, 2022 (HK$ Thousand) | January 1 to December 31, 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 2,792,666 | 4,496,736 | | Other income | 8,182 | 19,385 | | Selling expenses | (2,777,578) | (4,342,857) | | Administrative expenses | (168,958) | (279,668) | | Loss before tax | (148,039) | (86,891) | | Loss for the period / year from discontinued operations | (186,595) | (100,061) | | Loss on derecognition of discontinued operations | (210,771) | – | | **Total Loss** | **(397,366)** | **(100,061)** | - Staff costs for discontinued operations were **HK$1,254,342 thousand** (2021: HK$1,981,548 thousand)[10](index=10&type=chunk) [Cash Flows](index=15&type=section&id=2.7.3%20Cash%20Flows) For the period ended August 31, 2022, discontinued operations generated net cash inflow from operating activities of HK$520,793 thousand, but overall net cash outflow was HK$210,578 thousand Cash Flows from Discontinued Operations | Cash Flow Category | January 1 to August 31, 2022 (HK$ Thousand) | January 1 to December 31, 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Net cash generated from / (used in) operating activities | 520,793 | (1,082,142) | | Net cash used in investing activities | (33,750) | (35,149) | | Net cash used in financing activities | (648,351) | (26,702) | | Net decrease in cash and cash equivalents | (161,308) | (1,143,993) | | Effect of foreign exchange rate changes | (49,270) | 39,852 | | **Net Cash Outflow** | **(210,578)** | **(1,104,141)** | [Net Assets Derecognized](index=16&type=section&id=2.7.4%20Net%20Assets%20Derecognized) As of the derecognition date, Poly Consultants Group's net assets were HK$299,580 thousand, and the derecognition resulted in a net cash outflow of HK$675,206 thousand Net Assets of Poly Consultants Group at Derecognition Date | Asset Category | Amount (HK$ Thousand) | | :--- | :--- | | Investment properties | 23,516 | | Property, plant and equipment | 73,228 | | Right-of-use assets | 111,040 | | Interests in associates | 37,816 | | Trade and other receivables | 1,504,694 | | Bank balances and cash | 675,206 | | Trade and other payables | (2,125,920) | | **Net Assets** | **299,580** | - The net cash outflow arising from derecognition was **HK$675,206 thousand**[19](index=19&type=chunk) [Restatement of Comparative Figures](index=16&type=section&id=2.7.5%20Restatement%20of%20Comparative%20Figures) To conform to the current year's presentation, the comparative consolidated statement of profit or loss and other comprehensive income and related notes have been restated as if the discontinued operations had ceased at the beginning of the comparative period, with no impact on financial position, performance, or cash flows - To conform to the current year's presentation, the comparative consolidated statement of profit or loss and other comprehensive income and related notes have been restated as if the discontinued operations for the year had ceased at the beginning of the comparative period[35](index=35&type=chunk) - The restatement had no impact on the Group's reported financial position, performance, or cash flows[35](index=35&type=chunk) [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) [2022 Full Year Market Review](index=17&type=section&id=3.1%202022%20Full%20Year%20Market%20Review) In 2022, China's real estate sector faced multiple challenges from global economic volatility, industry adjustments, and the COVID-19 pandemic, leading to significant declines in sales and investment, with market recovery still requiring time despite government support policies at year-end - In 2022, China's mainland real estate industry faced numerous challenges, affected by global economic volatility, industry restructuring, and the COVID-19 pandemic[53](index=53&type=chunk) - National commercial housing sales decreased by approximately **30%** year-on-year, and national real estate development investment also significantly declined[53](index=53&type=chunk) - Despite government policies introduced at year-end to support the real estate industry, recovery will take time[53](index=53&type=chunk) [Overall Business Review of the Group](index=17&type=section&id=3.2%20Overall%20Business%20Review%20of%20the%20Group) The Group's turnover for 2022 was HK$1,517,000 thousand, a decrease of approximately 43% year-on-year, with loss attributable to shareholders reaching HK$580,000 thousand and basic loss per share at 86.1 HK cents, and the Board not recommending a final dividend Group Overall Business Performance | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Turnover | HK$1,517,000,000 | HK$2,669,000,000 | | Year-on-year change in turnover | Decreased by approximately 43% | | | Loss attributable to shareholders | HK$580,000,000 | HK$545,000,000 | | Basic loss per share | 86.1 HK cents | 80.8 HK cents | - The Board does not recommend the payment of a final dividend for the year ended December 31, 2022[54](index=54&type=chunk) [Property Agency Business](index=18&type=section&id=3.3%20Property%20Agency%20Business) Property agency business turnover decreased by 43% to HK$1,426,000 thousand, primarily due to the challenging mainland real estate environment; the Group reorganized its cooperation with Poly, received increased shareholding from Country Garden Services, and is exploring "AI Home Viewing" digital operating models Property Agency Business Performance | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Turnover | HK$1,426,000,000 | HK$2,489,000,000 | | Decrease in turnover | 43% | | - The decrease in turnover was mainly due to the challenging environment in the mainland real estate industry, constrained by economic and pandemic uncertainties and developers' debt risks[55](index=55&type=chunk) - The Group reorganized its cooperation with Poly, acquiring Poly's **43.9% equity interest** in Hopefluent China and selling its equity interest in Poly Consultants Group to Poly[56](index=56&type=chunk) - The Group received an increased shareholding from Country Garden Services, which is expected to strengthen real estate brokerage and property value-added services[56](index=56&type=chunk) - The Group is committed to exploring digital operations and sustainable service models through its "AI Home Viewing" platform[56](index=56&type=chunk) - Currently, the Group's property agency business covers over **80 cities** of various sizes nationwide, with over **1,100 agency projects** and approximately **160 secondary market branches**[67](index=67&type=chunk) [Financial Services Business](index=19&type=section&id=3.4%20Financial%20Services%20Business) In 2022, the financial services business recorded a total transaction volume of approximately HK$512,000 thousand and turnover of approximately HK$91,000 thousand, a decrease from 2021, with the Group focusing on serving existing high-quality clients and prioritizing risk control through stringent vetting procedures Financial Services Business Performance | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Total transaction volume | HK$512,000,000 | | | Turnover | HK$91,000,000 | HK$180,000,000 | - The financial services business faced an overall market contraction, with the Group focusing on serving existing high-quality clients[68](index=68&type=chunk) - The Group employs more stringent vetting procedures to select real estate enterprises and high-net-worth individuals with high investment and financing needs, prioritizing risk control as a key operating principle[68](index=68&type=chunk) [Outlook for 2023](index=19&type=section&id=3.5%20Outlook%20for%202023) The Group anticipates market recovery in 2023, driven by government policies to stabilize the economy and support the real estate sector, expecting to reverse its disadvantage and continue to deepen its presence in key cities while expanding digital business opportunities - It is expected that in 2023, the mainland government will prioritize stable economic development, with real estate remaining a pillar industry of the national economy[69](index=69&type=chunk) - The government will fully support the market from both supply and demand sides by releasing more financial tools, improving financial and home purchase restrictions, and stimulating consumption through loan incentives[69](index=69&type=chunk) - With the fading of the pandemic's shadow, China's mainland economy has emerged from its trough, and with a recovery in real estate market sales, the Group's performance is expected to reverse its disadvantage[70](index=70&type=chunk) - The Group will continue to deepen its presence in key cities, consolidate its business foundation, maintain existing customer resources, and expand more business opportunities through new digital business initiatives[51](index=51&type=chunk) [Other Information](index=20&type=section&id=Other%20Information) [Audit Committee](index=20&type=section&id=4.1%20Audit%20Committee) The company's Audit Committee, comprising three independent non-executive directors, has reviewed the audited financial statements for the year ended December 31, 2022 - The company's Audit Committee, consisting of three incumbent independent non-executive directors, has reviewed the audited financial statements for the year ended December 31, 2022[60](index=60&type=chunk) [Liquidity and Financial Resources](index=20&type=section&id=4.2%20Liquidity%20and%20Financial%20Resources) As of December 31, 2022, the Group maintained a sound financial position with cash and bank deposits of approximately HK$394,000 thousand and a current ratio of 3.72; total borrowings were approximately HK$232,000 thousand, with a gearing ratio of approximately 7.6%, no significant contingent liabilities, and low foreign exchange risk Overview of Liquidity and Financial Resources | Metric | December 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | Cash and bank deposits | HK$394,000,000 | HK$1,721,000,000 | | Current ratio | 3.72 | 2.32 | | Total borrowings | HK$232,000,000 | HK$516,000,000 | | Gearing ratio | 7.6% | 7.4% | - The Group's borrowings are denominated in RMB[71](index=71&type=chunk) - The Group had no significant contingent liabilities as of December 31, 2022[71](index=71&type=chunk) - The Group pledged investment properties and property, plant and equipment totaling approximately **HK$35,000,000** to banks to secure bank borrowings[72](index=72&type=chunk) - The majority of the Group's business transactions are denominated in HKD or RMB, thus not exposing it to significant foreign exchange fluctuation risks[73](index=73&type=chunk) [Employees and Environmental Policy](index=20&type=section&id=4.3%20Employees%20and%20Environmental%20Policy) As of December 31, 2022, the Group had approximately 7,300 full-time employees, viewing them as valuable assets, and is committed to fostering an environmentally friendly work environment by conserving water and electricity and encouraging recycling to minimize environmental impact - As of December 31, 2022, the Group had approximately **7,300 full-time employees**[62](index=62&type=chunk) - The Group regards its employees as its greatest and most valuable asset, with compensation packages determined by responsibilities, qualifications, performance, and seniority[62](index=62&type=chunk) - The Group is committed to creating an environmentally friendly work environment, conserving natural resources, and minimizing environmental impact by saving water and electricity and encouraging recycling of office supplies[74](index=74&type=chunk) [Capital Structure](index=21&type=section&id=4.4%20Capital%20Structure) As of December 31, 2022, the total number of shares in the company's issued share capital with a par value of HK$0.01 per share was 674,149,989 shares - As of December 31, 2022, the total number of shares in the company's issued share capital with a par value of **HK$0.01 per share** was **674,149,989 shares**[63](index=63&type=chunk) [Dividend Policy](index=21&type=section&id=4.5%20Dividend%20Policy) The Board does not recommend a final dividend for the year ended December 31, 2022, and no interim dividend was declared for the six months ended June 30, 2022 - On March 28, 2023, the Board did not recommend the payment of a final dividend for the year ended December 31, 2022[76](index=76&type=chunk) - No interim dividend was declared for the six months ended June 30, 2022[76](index=76&type=chunk) [Closure of Register of Members](index=21&type=section&id=4.6%20Closure%20of%20Register%20of%20Members) The company will suspend its share transfer registration from June 12, 2023, to June 15, 2023, to determine shareholders' eligibility to attend and vote at the 2023 Annual General Meeting - The company will suspend its share transfer registration from **June 12, 2023, to June 15, 2023**[64](index=64&type=chunk) - The suspension of share transfer registration aims to determine shareholders' eligibility to attend and vote at the 2023 Annual General Meeting[64](index=64&type=chunk) [Purchase, Redemption or Sale of the Company's Listed Securities](index=21&type=section&id=4.7%20Purchase,%20Redemption%20or%20Sale%20of%20the%20Company's%20Listed%20Securities) Since its listing date, the company has not redeemed any of its shares, nor has the company or any of its subsidiaries purchased or sold any of the company's shares - Since its listing date, the company has not redeemed any of its shares, nor has the company or any of its subsidiaries purchased or sold any of the company's shares[78](index=78&type=chunk) [Corporate Governance](index=21&type=section&id=4.8%20Corporate%20Governance) For the year ended December 31, 2022, the company generally complied with the Corporate Governance Code, with minor deviations regarding the separation of Chairman and CEO roles and Board meeting frequency, and directors confirm full compliance with the Model Code - For the year ended December 31, 2022, the company generally complied with the code provisions set out in Part 2 of Appendix 14 to the Listing Rules, the Corporate Governance Code, with certain deviations[85](index=85&type=chunk) - The directors confirm full compliance with the required standards set out in the Model Code[80](index=80&type=chunk) [Chairman and Chief Executive Officer](index=21&type=section&id=4.9%20Chairman%20and%20Chief%20Executive%20Officer) Mr. Fu Wai Chung serves as the company's Chairman and co-founder, possessing extensive industry experience; the company has no CEO position, with daily operations overseen by executive directors and senior management to ensure balanced power distribution - Mr. Fu Wai Chung is the company's Chairman and co-founder, possessing extensive industry experience[86](index=86&type=chunk) - The company has not established a Chief Executive Officer position, with daily operations and management overseen by executive directors and senior management[79](index=79&type=chunk) - The Board believes that despite the absence of a Chief Executive Officer position, the Board, composed of experienced individuals, holds regular meetings to discuss matters affecting the company's operations, ensuring a balanced distribution of power[79](index=79&type=chunk) [Company Secretary](index=22&type=section&id=4.10%20Company%20Secretary) Mr. Lo Hang Hong, a Hong Kong practicing solicitor, has been appointed as the company secretary, with Mr. Lo Yat Fung, an executive director, serving as his contact person - The company has appointed Mr. Lo Hang Hong, a Hong Kong practicing solicitor, as its company secretary, and the contact person for the company secretary is Mr. Lo Yat Fung, an executive director of the company[87](index=87&type=chunk) [2023 Annual General Meeting](index=22&type=section&id=4.11%202023%20Annual%20General%20Meeting) The company will hold its 2023 Annual General Meeting on Thursday, June 15, 2023, with the notice to be published on the Stock Exchange and company websites and dispatched to shareholders - The company will hold its 2023 Annual General Meeting on **Thursday, June 15, 2023**[89](index=89&type=chunk) - The notice convening the 2023 Annual General Meeting will be published on the Stock Exchange website and the company's website, and dispatched to the company's shareholders[89](index=89&type=chunk) [Acknowledgement](index=23&type=section&id=4.12%20Acknowledgement) The Board sincerely thanks the Group's clients, shareholders, and all employees for their support and contributions during the year; as of the date of this announcement, the Board comprises executive directors, non-executive directors, and independent non-executive directors - The Board sincerely thanks the Group's clients and shareholders for their support, and also thanks all Group employees for their tireless and dedicated contributions during the year[90](index=90&type=chunk) - As of the date of this announcement, the Board comprises executive directors Mr. Fu Wai Chung, Ms. Fu Man, Mr. Lo Yat Fung, and Mr. Fu Yee Lap; non-executive director Ms. Wu Yun; and independent non-executive directors Mr. Lam King Pei, Mr. Ng Keung, and Ms. Wong Lo Kwai Wah[83](index=83&type=chunk)

Financial Performance - Revenue for the six months ended June 30, 2022, was HKD 2,973,645, a decrease of 24.4% compared to HKD 3,931,313 for the same period in 2021[2] - The company reported a loss before tax of HKD 641,650 for the six months ended June 30, 2022, compared to a profit in the same period of 2021[2] - The net loss attributable to owners of the company for the period was HKD 663,875, compared to a profit of HKD 41,938 in the prior year[5] - Total comprehensive loss for the period was HKD 814,090, a significant increase from a total comprehensive income of HKD 63,603 in the previous year[5] - Basic and diluted loss per share was HKD 72.26, compared to earnings of HKD 4.87 per share in the same period last year[5] - The revenue from property agency services was HKD 2,937,664 thousand, down 23.1% from HKD 3,821,157 thousand in the previous year[24] - Financing income, including interest income from receivables, was HKD 33,259 thousand, a decline of 58.1% compared to HKD 79,396 thousand in 2021[24] - The company reported a net cash used in financing activities of HKD (166,414) thousand for the period[14] - The company reported a loss of HKD 663,875 for the six months ended June 30, 2022, compared to a profit of HKD 41,938 in the same period of 2021[32][33] - The segment loss for property agency was HKD 384,600, while the financial services segment reported a profit of HKD 19,355[32] Cash Flow and Liquidity - The net cash used in operating activities for 2022 was HKD (125,746) thousand, compared to HKD 277,091 thousand in 2021[14] - The cash and cash equivalents at the end of the period were HKD 486,403 thousand, significantly down from HKD 2,973,056 thousand at the end of 2021[14] - The total cash and cash equivalents decreased by HKD 2,490,616 thousand from the beginning of the period[14] - As of June 30, 2022, the group maintained a cash and bank deposit balance of approximately HKD 487 million, down from HKD 1.721 billion as of December 31, 2021[77] - The current ratio as of June 30, 2022, was 2.16, compared to 2.32 as of December 31, 2021[77] - The total borrowings amounted to approximately HKD 381 million, down from HKD 516 million as of December 31, 2021, with a capital debt ratio of approximately 6.3%[77] Operational Changes and Strategy - The company is focusing on restructuring and improving operational efficiency to address the current financial challenges[2] - The company operates two reportable segments: property agency services and financial services, which require different business strategies[22] - The company has classified the assets and liabilities of the Poly Consulting Group as held for sale, with total assets amounting to HKD 2,784,011,000 and liabilities of HKD 1,834,244,000[53] - The company is in the process of a conditional agreement to sell its 43.9% stake in a subsidiary, which will result in the subsidiary becoming a wholly-owned subsidiary post-restructuring[49] - The group adjusted its cooperation model with Poly Development, taking over 43.9% of the equity in HeFu China and selling Poly Consulting Group, resulting in an impairment of goodwill of approximately HKD 206 million[73] Employee and Cost Management - Total employee costs for the six months ended June 30, 2022, were HKD 1,724,999, down from HKD 2,108,791 in the previous year, indicating a reduction of approximately 18.2%[37] - The group views employees as valuable assets, with approximately 18,600 full-time staff as of June 30, 2022[80] Market Conditions - The real estate market in mainland China faced significant challenges, with the top 100 property companies experiencing a sales decline of over 50% year-on-year in the first half of 2022[66] - The financial services business had a total transaction amount of approximately HKD 600 million, down from HKD 1.6 billion in the previous year, with revenue of approximately HKD 36 million compared to HKD 110 million in the prior year[74] Corporate Governance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange rules during the six months ending June 30, 2022[100] - The company secretary is a practicing lawyer, ensuring compliance with applicable laws and regulations[101] - The company has adopted the standard code of conduct for securities transactions by directors as per the listing rules and confirmed compliance[102] Shareholder Information - As of June 30, 2022, major shareholders held the following stakes: Mr. Fu Wei Cong with 340,369,807 shares (50.49%), Fu's Family Limited with 174,184,799 shares (25.84%), and China-net Holding Ltd. with 130,762,340 shares (19.40%)[93] - No stock options were granted, canceled, exercised, or lapsed during the reporting period[90] - The company has not repurchased any shares since its listing and has not purchased or sold any shares of the company or its subsidiaries[99]

Financial Performance - The total revenue for the year 2021 was HKD 7,166,000,000, representing a 16% increase compared to the same period in 2020[21]. - The property agency business revenue increased from HKD 5,994,000,000 in 2020 to HKD 6,986,000,000 in 2021, marking a growth of 17%[23]. - The company reported a loss attributable to shareholders of HKD 545,000,000, primarily due to additional provisions for expected credit losses amounting to HKD 458,000,000[21]. - The company's revenue for the year ended December 31, 2021, was HKD 7,166,000,000, an increase of approximately 16% compared to HKD 6,193,000,000 in 2020[47]. - The company reported a loss attributable to shareholders of HKD 545,000,000 for 2021, compared to a profit of HKD 184,000,000 in 2020[47]. - The property agency business segment generated revenue of HKD 6,986,000,000, accounting for 97% of total revenue, while the financial services segment contributed approximately HKD 180,000,000, or 3% of total revenue[47]. - The financial services segment experienced a decline compared to the previous year due to tightening financing conditions in the real estate market[24]. - The total sales amount for new homes in 2021 was approximately HKD 608 billion, with a total of 377,000 transactions and a total sales area of about 33 million square meters[47]. Business Strategy and Market Position - The company has established partnerships with over 100 cities and aims to deepen customer expansion and service offerings in the domestic real estate service market[8]. - The integration of internet technology with traditional property agency services has been emphasized, with the development of the "AI Hopefluent" platform showing promising results[23]. - The company continues to focus on risk control and diversifying its product offerings in response to changing market demands[24]. - The company has maintained strong relationships with major developers, enhancing its position in the real estate service market[8]. - The company aims to solidify its business development and create greater value for local communities and shareholders[25]. - The company plans to integrate an "online + offline" business model to capture more market share in advantageous cities[25]. - The Greater Bay Area is currently experiencing a major development window, driven by policy incentives that boost urban development and real estate demand[25]. - The company aims to expand its business in key regions such as the Guangdong-Hong Kong-Macao Greater Bay Area and the Yangtze River Delta[53]. Financial Position and Liquidity - The group maintains a strong financial position with cash and bank deposits of approximately HKD 1,721,000,000 as of December 31, 2021, down from HKD 2,877,000,000 in the previous year[57]. - The current ratio is 2.32, a decrease from 2.65 as of December 31, 2020, indicating a slight decline in liquidity[57]. - The total borrowings amount to approximately HKD 516,000,000, which includes both secured and unsecured bank loans, compared to HKD 505,000,000 in the previous year[57]. - The capital debt ratio is approximately 7.4%, up from 6.8% as of December 31, 2020, reflecting an increase in leverage[57]. - The overall performance of the company was significantly impacted by the tightening of market conditions and the debt crisis affecting many real estate companies[46]. Governance and Management - The company does not have a CEO position; daily operations are overseen by executive directors and senior management[76]. - The board of directors has held 12 meetings and one annual general meeting during the fiscal year ending December 31, 2021, with full attendance from all directors[70]. - The audit committee, composed of three independent non-executive directors, reviewed the financial statements for the year ending December 31, 2021[88]. - The company’s governance policies and practices are regularly reviewed by the board to ensure compliance with legal and regulatory requirements[75]. - The company has established an internal control department since 2006 to ensure compliance with policies and procedures across its branches[108]. - The board is responsible for overseeing the company's risk management and internal control systems, which are reviewed annually[108]. - The company has adopted a diversity policy for its board members, effective from September 1, 2014, focusing on sustainable development and performance enhancement[100]. - The company has confirmed the independence of all its non-executive directors according to the stock exchange listing rules[176]. Employee and Stakeholder Relations - The group has approximately 19,300 full-time employees, emphasizing the importance of human resources as a valuable asset[60]. - The company emphasizes the importance of maintaining good relationships with employees, customers, and business partners for sustainable development[131]. - The company has established communication channels with shareholders, including annual and interim reports, announcements, and its website[125]. Environmental, Social, and Governance (ESG) - The environmental, social, and governance (ESG) report outlines the company's commitment to sustainable development and its performance in these areas[190]. - The group aims to reduce its environmental impact through measures such as water and electricity conservation and encouraging recycling[183]. - The group has set a greenhouse gas emission reduction target of approximately 5% for 2022, maintaining levels from 2021[194]. - The board of directors is responsible for overseeing the company's corporate governance and ESG management methods[193]. - The company has adopted various environmental and social policies to support sustainable development[191]. - The group has established a working group to identify and assess ESG risks and the effectiveness of internal controls[194]. Shareholder and Dividend Policy - The company did not recommend a final dividend for the year ended December 31, 2021[47]. - The company has a dividend policy approved in 2019, which does not set a predetermined payout ratio, allowing the board to decide based on various financial factors[103]. - The board will consider actual and expected financial performance, operational funding needs, and overall economic conditions when declaring dividends[106]. - The company emphasizes the importance of transparency in its dividend policy to facilitate informed investment decisions by shareholders[102]. - As of December 31, 2021, the company had distributable reserves of approximately HKD 388,000,000 available for dividend payments to shareholders[143].

Financial Performance - Revenue for the six months ended June 30, 2021, was HKD 3,931,313, an increase of 50.7% compared to HKD 2,608,328 for the same period in 2020[3]. - The net profit for the period was HKD 15,173, a significant decrease of 90.6% from HKD 160,555 in the previous year[4]. - Total comprehensive income for the period was HKD 63,603, compared to HKD 80,631 in the same period last year, reflecting a decline of 21.1%[4]. - Basic and diluted earnings per share were HKD 0.0487, down from HKD 0.1073 in the prior year, representing a decrease of 54.7%[4]. - The company declared a dividend of HKD 3,371, a decrease of 80% from HKD 16,854 in the previous year[4]. - The group reported a profit of 32,799 thousand HKD for the six months ended June 30, 2021, a decrease of 54.7% compared to 72,351 thousand HKD for the same period in 2020[48]. - Shareholders' profit for the same period was HKD 32,800,000, a decrease of about 55% from HKD 72,400,000 year-on-year[68]. Revenue Breakdown - The revenue from property agency services was HKD 3,821,157 thousand, up from HKD 2,520,806 thousand in the previous year, indicating a growth of about 51.6%[26][31]. - Financial services revenue increased to HKD 30,760 thousand from HKD 23,418 thousand, reflecting a growth of approximately 31.5%[26][27]. - The property agency business generated revenue of HKD 3,821,200,000, accounting for 97% of total revenue, with a year-on-year increase of approximately 52%[71]. - Financial services revenue was approximately HKD 110,100,000, up about 26% from HKD 87,500,000 in the previous year[72]. Assets and Liabilities - Non-current assets as of June 30, 2021, totaled HKD 1,074,255, a decrease from HKD 1,169,007 as of December 31, 2020[9]. - Current assets increased to HKD 6,604,502 from HKD 6,302,571 at the end of 2020, indicating a growth of 4.8%[9]. - Total equity attributable to owners of the company was HKD 3,524,906, up from HKD 3,479,216 at the end of 2020, reflecting an increase of 1.3%[9]. - Total borrowings were approximately HKD 386,000,000, a decrease from HKD 505,000,000 as of December 31, 2020, reflecting improved financial health[75]. - The capital-to-asset ratio was approximately 5.0%, down from 6.8% as of December 31, 2020, suggesting a reduction in leverage[75]. Cash Flow - The net cash generated from operating activities was HKD 277,091 thousand, while cash used in investing activities was HKD 632,651 thousand[17]. - The company reported a significant increase in cash and cash equivalents, reaching HKD 2,973,056 compared to HKD 2,877,029 at the end of 2020, an increase of 3.3%[9]. - The cash and cash equivalents at the end of the period were HKD 2,973,056 thousand, compared to HKD 2,513,622 thousand at the end of the previous period[17]. - The company reported a net cash increase of HKD 396,645 thousand in cash and cash equivalents during the period[17]. - As of June 30, 2021, the group's cash and bank deposits amounted to approximately HKD 2,973,100,000, an increase from HKD 2,877,000,000 as of December 31, 2020[75]. Employee and Operational Costs - Employee costs increased to 2,108,791 thousand HKD in the first half of 2021, up from 1,442,711 thousand HKD in the same period of 2020, reflecting a rise of 46.2%[45]. - The group has approximately 22,500 full-time employees, with a competitive compensation structure based on individual roles and performance[78]. Strategic Initiatives - The company aims to expand its market presence and invest in new technologies to drive future growth[2]. - The group plans to enhance digital marketing efforts and integrate technology into traditional real estate operations to improve efficiency and expand business scale[71]. - The financial services business aims to explore more business models and develop personalized products to enhance core competitiveness and investment returns[72]. - The group will maintain a prudent financial control system to improve overall operational efficiency in response to industry competition and external environment[74]. - The company plans to enhance its financial and asset management services to drive business growth and maintain its leading position in the market[75]. Corporate Governance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange rules, except for deviations noted in sections A.2.1 and F.1.1[100]. - The board of directors is composed of experienced individuals, ensuring balanced power distribution despite the absence of a CEO position[100]. - The company secretary is a practicing lawyer, which aids in compliance with applicable laws and regulations[101]. - The establishment of an audit committee consisting of three independent non-executive directors has been completed to oversee financial reporting and internal controls[75]. Market Position and Expansion - The group has expanded its property agency business to over 200 cities, with more than 1,800 projects and approximately 330 second-hand branches[71]. - The group aims to adapt its strategies in response to market changes, particularly in key cities with strong business potential[75]. Shareholder Information - The major shareholders of the company include Fu's Family Limited with 50.49% ownership, China-net Holding Ltd. with 19.40%, and Fu Erli with 11.62%[94]. - Fu's Family Limited holds 174,184,799 shares, while China-net Holding Ltd. has 130,762,340 shares registered under its name[95]. - The company has not repurchased any of its shares since its listing, nor have any subsidiaries bought or sold shares of the company[99]. - The company will suspend share transfer registration from September 23 to September 24, 2021, for mid-term dividend eligibility[98]. - All disclosed shareholdings are classified as long positions[96].

Financial Performance - Revenue for the six months ended June 30, 2020, was HKD 2,608,328, a decrease of 11.7% compared to HKD 2,955,281 for the same period in 2019[2] - Profit for the period from continuing operations was HKD 160,555, down 16.8% from HKD 190,877 in the prior year[3] - Total comprehensive income for the period was HKD 80,631, a decline of 47.9% from HKD 154,433 in the previous year[3] - Basic and diluted earnings per share from continuing operations were HKD 10.73, compared to HKD 13.56 in the same period last year, representing a decrease of 20.9%[3] - The company reported a segment profit of HKD 268,499 for continuing operations, compared to HKD 328,933 in the previous year, reflecting a decrease of 18.4%[27] - The profit for the six months ended June 30, 2020, was HKD 72,351,000, a decrease of 31.7% compared to HKD 105,938,000 for the same period in 2019[35] - The profit attributable to shareholders was HKD 72,400,000, down about 20% from HKD 105,900,000 in the previous year[59] - Basic earnings per share were HKD 0.1073, compared to HKD 0.1586 for the previous year[59] Revenue Breakdown - The company's total revenue for the six months ended June 30, 2020, was HKD 3,293,946,000, compared to HKD 3,021,567,000 for the same period in 2019, reflecting an increase of 9%[12] - Revenue from continuing operations for the six months ended June 30, 2020, was HKD 2,608,328, a decrease of 11.7% compared to HKD 2,955,281 for the same period in 2019[21] - Commission income from property agency services was HKD 2,520,806, down from HKD 2,841,228, representing a decline of 11.3% year-on-year[23] - Financial services income increased to HKD 23,418, up from HKD 10,253, marking a significant growth of 128.5%[23] - The property agency business generated revenue of HKD 2,520,800,000, accounting for 97% of the total revenue[59] - Financial services recorded revenue of HKD 87,500,000, representing 3% of the total revenue[59] Cash Flow and Assets - For the six months ended June 30, 2020, the net cash generated from operating activities was HKD 632,651,000, compared to HKD 185,421,000 for the same period in 2019, representing an increase of 241%[14] - The total cash and cash equivalents at the end of the period were HKD 2,513,622,000, up from HKD 1,889,317,000 at the end of June 2019, indicating a growth of 33%[14] - Cash and cash equivalents increased to HKD 2,513,622 from HKD 2,163,397 at the end of 2019, reflecting a growth of 16.2%[9] - The company reported a total asset value of HKD 5,441,573 as of June 30, 2020, an increase from HKD 5,264,742 at the end of 2019[9] Dividends - The company declared a dividend of HKD 16,854, down from HKD 30,337 in the previous year, indicating a reduction of 44.5%[3] - The interim dividend declared was HKD 0.025 per share, down from HKD 0.045 per share in the previous year[59] - The company declared an interim dividend of HKD 0.025 per share for the six months ended June 30, 2020, to be paid on October 15, 2020[72] Liabilities and Equity - The company’s total equity increased to HKD 4,453,209 from HKD 4,372,578, reflecting a growth of 1.8%[9] - The group's total borrowings were approximately HKD 350,000,000, down from about HKD 516,000,000 as of December 31, 2019[68] - The group's capital debt ratio was approximately 5.5% as of June 30, 2020, compared to 8.1% as of December 31, 2019[68] Operational Segments - The company has two main operating segments: property agency services and financial services, down from three segments in 2019[19] - The group plans to continue focusing on expanding its financial services segment to drive future growth[21] - The group has strengthened its financial and asset management business segments in preparation for future development[59] Market and Future Plans - The company plans to continue focusing on market expansion and new product development to drive future growth[19] - The group will continue to seek business opportunities while adhering to government policies to drive growth[65] - The group plans to strengthen its financial and asset management business to create new growth points in response to market conditions[63] Shareholder Information - As of June 30, 2020, Mr. Fu holds 340,369,807 shares, representing 50.49% of the company's equity[81] - Fu's Family Limited owns 174,184,799 shares, accounting for 25.84% of the total equity[81] - The company received valid acceptances for 23,784,002 shares under a mandatory unconditional cash offer, equivalent to approximately 3.53% of the total issued share capital[87] Corporate Governance - The company has complied with the corporate governance code, except for deviations noted in specific clauses[88] - The company has appointed a new executive director effective August 27, 2020[93] - The board of directors consists of executive directors Mr. Fu Wai Chung, Ms. Fu Man, Mr. Lu Yi Feng, and Mr. Fu Er Li; non-executive directors Ms. Ng Yun and Mr. Mo Tin Chuen; and independent non-executive directors Mr. Lam King Pui, Mr. Ng Keung, and Ms. Wang Luo Gui Hua[95]

Financial Performance - The group's total revenue for 2019 reached HKD 6,076,000,000, an increase of approximately 25% compared to HKD 4,878,000,000 in 2018[25] - Shareholders' profit attributable to the company was HKD 484,000,000, with a profit from continuing operations of HKD 252,000,000 and from discontinued operations of HKD 232,000,000[25] - The property agency business generated revenue of HKD 5,861,000,000, reflecting a growth rate of about 25%[26] - Financial services contributed revenue of HKD 215 million, representing a year-on-year increase of approximately 24%[29] - The profit attributable to shareholders reached HKD 484,000,000, with a profit from continuing operations of HKD 252,000,000 and from discontinued operations of HKD 232,000,000[52] - The basic earnings per share for continuing and discontinued operations were HKD 0.723, up from HKD 0.490 in 2018[52] - The total new property sales amount for the year was HKD 535.1 billion, facilitating approximately 378,900 transactions with a total sales area of about 35.1 million square meters[53] - The financial services business reported revenue of approximately HKD 215,000,000, representing 4% of total revenue[53] Market Position and Strategy - The group serves over 100 cities, strengthening its position in the domestic real estate service market[15] - The company aims to expand its market presence by actively seeking new agency projects in various regions[15] - The group has a competitive advantage in the South China and Yangtze River Delta regions, allowing for effective responses to market challenges[25] - The group anticipates steady growth in the property agency sector, supported by various government policies aimed at revitalizing the real estate market[30] - The group aims to leverage its strong foundation in property agency services and close relationships with major developers to drive financial business growth[30] - Collaboration with Poly Development has significantly expanded the group's business footprint, particularly in the Greater Bay Area[30] Technology and Innovation - The integration of internet technology with traditional service models has improved service quality and operational efficiency[19] - The group has developed internet applications to enhance property sales and customer engagement, ensuring a competitive edge in the market[30] - The company continues to implement an internet integration strategy, increasing online investments and promoting resource interaction with new media platforms[54] - The group has developed various internet applications to adapt to diverse property sales formats, enhancing its market position, especially in the Guangdong-Hong Kong-Macao Greater Bay Area[59] Corporate Governance - The company is committed to maintaining high standards of corporate governance and has adopted the corporate governance code as per the Hong Kong Stock Exchange[75] - The board is responsible for leading and controlling the group, focusing on long-term goals, overall strategy, and financial performance monitoring[83] - The company does not have a CEO position; daily operations are overseen by executive directors and senior management[88] - The company has not established a corporate governance committee; the board is responsible for corporate governance functions, including policy formulation and compliance with legal regulations[84] - The board ensures that all directors have access to necessary information and resources to fulfill their duties effectively[84] - The company’s governance policies and practices are reviewed regularly to ensure compliance with applicable rules and regulations[84] Risk Management - The company has implemented a risk management framework to identify and monitor significant risks, with departments assessing major risk events annually[126] - The audit committee ensures that operations comply with the group's standards, safeguarding assets from unauthorized use and ensuring accurate financial reporting[126] - The company aims to manage risks rather than eliminate them, providing reasonable assurance against significant misstatements or losses[126] - The board is committed to identifying and mitigating risks that could impact business objectives, promoting coordinated risk management measures[126] Employee Relations - The company emphasizes the importance of maintaining good relationships with employees, customers, and business partners for sustainable development[148] - The company is committed to providing competitive compensation and career development opportunities to its employees[148] - The compensation policy for employees is based on performance, experience, and current market rates, including benefits such as insurance and medical coverage[199] Shareholder Information - The board proposed a final dividend of HKD 0.08 per share and an interim dividend of HKD 0.045 per share, totaling HKD 0.125 per share for the year, compared to HKD 0.11 in 2018[52] - The company reported a final dividend of HKD 0.08 per share for the year ended December 31, 2019, compared to HKD 0.065 per share in 2018, resulting in a total dividend of HKD 0.125 per share for 2019, up from HKD 0.11 per share in 2018[145] - The company has adopted a dividend policy aimed at enhancing transparency and facilitating informed investment decisions[116] - The declaration and payment of dividends are at the discretion of the board, considering various factors including financial performance and operational needs[118] Financial Position - As of December 31, 2019, the group maintained a strong financial position with cash and bank deposits of approximately HKD 2.16 billion, up from HKD 1.72 billion in 2018, and a current ratio of 2.94[64] - The total borrowings amounted to approximately HKD 516 million, a decrease from HKD 691 million in 2018, with a capital debt ratio of about 8.1%[64] - As of December 31, 2019, the company had distributable reserves of approximately HKD 484,000,000, which includes share premium and retained earnings[162] Challenges and Outlook - The ongoing COVID-19 pandemic has posed challenges, but the long-term positive trend of the Chinese economy remains intact[30] - The group anticipates significant impacts on business in the first half of 2020 due to the COVID-19 pandemic, but remains confident in the long-term positive trend of the Chinese economy and real estate market[60] Transactions and Acquisitions - The group received HKD 250,000,000 from the sale of Sino Estate Holdings Limited, with approximately HKD 110,000,000 allocated for financial services development, HKD 30,000,000 for future dividend distribution, and HKD 30,000,000 for working capital[178] - The acquisition of Poly Real Estate Consulting Group involved issuing 43.9% of shares to Poly Real Estate, enhancing the company's competitive edge in property agency services[180]

Financial Performance - Revenue for the six months ended June 30, 2019, was HKD 3,250,881, representing a 34.2% increase from HKD 2,421,201 in the same period of 2018[2]. - Net profit for the period was HKD 190,877, up 36.4% from HKD 140,022 in the prior year[2]. - Basic earnings per share for the period was HKD 15.86, compared to HKD 20.59 in the same period of 2018[2]. - Total comprehensive income for the period was HKD 154,433, an increase of 52.1% from HKD 101,476 in the previous year[4]. - The group reported a total segment profit of HKD 328,933 for the six months ended June 30, 2019, compared to HKD 244,683 for the same period in 2018, representing an increase of approximately 34.4%[36]. - The group's profit for the six months ended June 30, 2019, was HKD 105,938,000, a decrease of 23% compared to HKD 137,512,000 for the same period in 2018[46]. - Shareholders' profit decreased by approximately 23% to HKD 105,900,000 from HKD 137,500,000 year-on-year[68]. Revenue Breakdown - The property agency segment generated revenue of HKD 2,841,228 for the six months ended June 30, 2019, compared to HKD 2,082,368 in the same period of 2018, reflecting a growth of about 36.5%[36]. - The financial services segment reported revenue of HKD 114,053 for the six months ended June 30, 2019, up from HKD 72,146 in the prior year, indicating a growth of approximately 58.2%[35]. - The property management services segment achieved revenue of HKD 295,600 for the six months ended June 30, 2019, compared to HKD 266,687 in the same period of 2018, marking a growth of around 10.8%[35]. - The property agency business segment generated revenue of HKD 2,841,200,000, accounting for 87% of the total revenue[68]. - The financial services segment recorded revenue of HKD 114,100,000, representing a year-on-year increase of approximately 58% from HKD 72,100,000[71]. Expenses and Costs - Operating expenses increased to HKD 2,476,862, a rise of 38.3% from HKD 1,792,098 in 2018[2]. - The company reported financing costs of HKD 31,618, which increased from HKD 18,983 in the previous year[2]. - Financing costs for the six months ended June 30, 2019, totaled HKD 31,618, compared to HKD 18,983 for the same period in 2018, reflecting an increase of about 66.5%[38]. - The group recognized depreciation expenses of approximately HKD 31,528,000 and additional interest costs of about HKD 7,186,000 related to leases under the new accounting standard[44]. Cash Flow and Liquidity - For the six months ending June 30, 2019, the net cash generated from operating activities was HKD 185,421,000, compared to a net cash used of HKD (164,652,000) in the previous period[11]. - The cash and cash equivalents at the end of the period increased to HKD 1,889,317,000 from HKD 1,014,178,000 in the previous period, reflecting a significant increase[11]. - The company’s cash and cash equivalents were HKD 1,889,317, up from HKD 1,723,391 at the end of 2018[6]. - The group maintains a strong financial position with cash and bank deposits of approximately HKD 1,889.3 million as of June 30, 2019, up from HKD 1,723.4 million at the end of 2018[83]. - The current ratio stands at 2.71, indicating a solid liquidity position compared to 2.57 at the end of 2018[83]. Assets and Liabilities - The total assets less current liabilities amounted to HKD 4,409,139, compared to HKD 4,041,104 as of December 31, 2018[6]. - The total assets increased by HKD 243,265,000 due to the adoption of HKFRS 16, which also resulted in a corresponding increase in total liabilities by the same amount[21]. - The group’s right-of-use assets increased to HKD 276,198 as of June 30, 2019, from HKD 243,265 at the beginning of the year, indicating a growth of approximately 13.5%[27]. - The lease liabilities increased to HKD 281,804 as of June 30, 2019, from HKD 243,265 at the beginning of the year, reflecting a growth of about 15.9%[27]. - The total amount of accounts receivable as of June 30, 2019, was HKD 1,770,378,000, slightly down from HKD 1,789,776,000 as of December 31, 2018[51]. Strategic Initiatives - The company aims to expand its market presence and enhance its product offerings in the upcoming periods[2]. - The group plans to reform its human resources structure to improve efficiency and reduce labor costs[69]. - The group aims to strengthen its strategic layout in key cities across the country through collaboration with Poly Developments and Holdings Group[68]. - The group has identified opportunities in the Greater Bay Area, leveraging government support for infrastructure and market development[80]. - The group is strategically adjusting its operations to focus more on the primary and secondary property agency business and financial services[80]. Dividends and Shareholder Information - The company declared a dividend of HKD 30,337, slightly up from HKD 30,060 in the same period last year[2]. - The interim dividend declared for the six months ended June 30, 2019, was HKD 0.045 per share, totaling HKD 30,337,000, compared to HKD 30,060,000 in 2018[45]. - The board declared an interim dividend of HKD 0.045 per share for the six months ending June 30, 2019, expected to be paid on October 18, 2019[87]. Corporate Governance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange regulations[106]. - The company has appointed a practicing lawyer as the company secretary to ensure compliance with applicable laws and regulations[108]. - The board of directors consists of experienced individuals, ensuring balanced power and authority distribution[107].

Financial Performance - The company's revenue for 2018 was HKD 5,450,000,000, an increase of 17% compared to HKD 4,672,000,000 in 2017[21] - The profit for the year was HKD 454,000,000, representing a year-on-year growth of approximately 33% from HKD 342,000,000 in 2017[21] - Shareholders' profit attributable to the company was HKD 327,000,000, slightly down from HKD 337,000,000 in 2017[21] - The group's total revenue for the year ended December 31, 2018, was HKD 5,450,000,000, representing an increase of approximately 17% compared to HKD 4,672,000,000 in 2017[49] - The group's profit for the year was HKD 454,000,000, a year-on-year increase of about 33% from HKD 342,000,000 in 2017[49] - The earnings attributable to shareholders were HKD 327,000,000, slightly down from HKD 337,000,000 in 2017[49] - The basic earnings per share were HKD 0.49, compared to HKD 0.504 in 2017[49] Revenue Breakdown - The property agency business generated revenue of HKD 4,723,000,000, an increase of about 18%[22] - The first-hand property business revenue was HKD 3,703,000,000, while the second-hand property business revenue was HKD 1,020,000,000[22] - The property agency business segment generated revenue of HKD 4,723,000,000, accounting for 87% of the group's total revenue[50] - The group's total revenue from property agency business for the year ended December 31, 2018, was HKD 4,723,000,000, representing an increase of approximately 18% compared to the previous year[55] - The new housing sales amount for the year was HKD 398 billion, facilitating approximately 306,000 transactions with a total sales area of about 30 million square meters[50] - The group facilitated approximately 50,400 second-hand property transactions in 2018, down from 69,000 transactions in 2017[55] Business Strategy and Market Position - The company has established partnerships with major developers, enhancing its position in the domestic real estate service market[13] - The integration of internet technology with traditional services has improved operational efficiency and service quality[17] - The company continues to expand its market presence and service offerings in over 50 cities[13] - The strategic collaboration with Poly Developments has significantly expanded the company's business footprint[22] - The company remains focused on a "professional + system" integrated real estate service model to adapt to market changes[22] - The group expanded its first-hand property agency business market share, covering over 150 cities and over 1,700 projects[54] - The group has successfully integrated its operations with Poly Development Holdings Group, enhancing its competitive edge in the market[49] Financial Services and Growth Opportunities - The financial services segment recorded a total transaction volume of HKD 4.4 billion and revenue of HKD 183,000,000, up from HKD 146,000,000 in 2017[56] - The group plans to strategically adjust its financial services focus towards micro-lending and asset management to capture growth opportunities in the domestic market[56] - The group has reserved ample resources to seize growth opportunities in the Guangdong-Hong Kong-Macao Greater Bay Area, which is expected to enhance interconnectivity among cities[60] Risk Management and Governance - The company has established a risk management and internal control system aimed at managing risks rather than eliminating them, ensuring reasonable assurance against significant misstatements or losses[115] - The board of directors reviewed and was satisfied with the effectiveness of the risk management and internal control system for the year ending December 31, 2018[117] - The audit committee's responsibilities include reviewing financial statements and monitoring risk management and internal controls[92] - The company has a dedicated internal control department established in 2006, responsible for internal audit functions and reporting directly to the board[115] Employee and Board Governance - The group employed approximately 27,000 full-time employees as of December 31, 2018[65] - The board includes both executive and independent non-executive members, ensuring governance and oversight[155] - The company is committed to providing competitive compensation and career development opportunities to its employees[140] - The board believes the current structure allows for strong and consistent leadership, enabling quick and effective decision-making[83] Dividend Policy - The company has approved a dividend policy aimed at enhancing transparency and facilitating informed investment decisions by shareholders[109] - The declaration and payment of dividends are at the discretion of the board, considering factors such as actual and expected financial performance and operational needs[110] - For the fiscal year ending December 31, 2018, the company paid an interim dividend of HKD 0.045 per share, totaling HKD 30,060,000, consistent with the previous year[136] - The proposed final dividend for the fiscal year ending December 31, 2018, is HKD 0.065 per share, down from HKD 0.095 per share in 2017, resulting in a total dividend of HKD 0.11 per share for 2018 compared to HKD 0.14 per share in 2017[136] Shareholder Information - The total equity held by Mr. Fu Wei Chong is 252,927,133 shares, representing approximately 37.86% of the issued share capital[160] - Ms. Wu Yun holds 7,398,334 shares, accounting for 1.11% of the total issued share capital[160] - Mr. Mo Tian Quan has 108,771,037 shares, which is 16.28% of the total issued share capital[160] - The major shareholder Fu holds a total of 260,325,467 shares, representing approximately 38.97% of the company's issued share capital[186] - Fu's Family Limited owns 174,184,799 shares, accounting for 26.08% of the issued share capital[186] - The company maintains sufficient public float, with over 25% of ordinary shares held by the public as of March 28, 2019[195] Compliance and Environmental Policies - The company has not reported any significant violations of applicable laws and regulations during the fiscal year[194] - The company is committed to environmental policies aimed at reducing resource consumption and promoting recycling[193]