Financial Performance - For the year ended December 31, 2021, the Group recorded total revenue of HK$5,186 million, an increase of 67.3% year-on-year[7]. - Profit for the year was HK$1,288 million, an increase of 156.2% year-on-year[7]. - The Group's gross profit margin rose by 8.6 percentage points year-on-year to 45.1%, while the net profit margin also climbed by 8.6 percentage points year-on-year to 24.8%[7]. - For the year ended December 31, 2021, the Group's revenue was HK$5,186 million, representing a 67.3% increase from HK$3,100 million in the previous year, while net profit attributable to equity holders was HK$1,288 million, up 156.2% from HK$503 million[19]. - Revenue from chemical operations was approximately HK$4,991 million, an increase of HK$1,892 million or 61.0% compared to the previous year, driven by higher unit selling prices due to strong demand[22]. Revenue Sources - Revenue from the sale of properties was approximately HK$195 million during the year, with 155 residential units delivered from the RIVERDALE project in Changshu, Jiangsu[8]. - The average selling price per ton of caustic soda increased by 30% to approximately RMB820, while methylene chloride and chloroform saw increases of 67% and 90%, reaching RMB4,500 and RMB4,000 respectively[23]. Production and Capacity - The second phase of fluoropolymer production was launched in Q4 2021, significantly increasing production capacity for specialty polymers like polytetrafluoroethylene (PTFE)[10]. - The actual production volume included approximately 360,000 tons for CMS products, 570,000 tons for caustic soda, 12,000 tons for polytetrafluoroethylene, and 390,000 tons for hydrogen peroxide[24]. - The Group's factory in Zhuhai commenced operations in mid-2021, contributing to revenue from lithium battery-related products[25]. Research and Development - Research and development costs amounted to approximately HK$231 million, representing 4.5% of total revenue, focusing on new product development and optimization of technical processes[32]. - The Group aims to enhance investment in high-end fluoropolymers and lithium battery new materials to increase market share and industry recognition[16]. Financial Health - Total shareholders' equity as of December 31, 2021, was HK$5,575 million, an increase from HK$4,444 million in 2020[39]. - Current assets amounted to HK$2,146 million as of December 31, 2021, compared to HK$1,780 million in 2020[39]. - The current ratio improved to 1.60 as of December 31, 2021, from 1.52 at the end of 2020[39]. - The net debt to equity ratio decreased to 12.70% as of December 31, 2021, from 24.97% in 2020[39]. Corporate Governance - The Board of Directors consists of 4 executive directors and 3 independent non-executive directors, with independent directors representing over one-third of the Board[63]. - The Company has adopted high standards of corporate governance, complying with the corporate governance code as per the Listing Rules[61]. - The Audit Committee held 3 meetings during the year, with full attendance from all members[80]. - The Company ensures that no Director is involved in deciding their own remuneration[81]. Risk Management - The Group has established a risk management framework involving the Board of Directors, the Audit Committee, and the Risk Management Taskforce to monitor and manage risks effectively[109]. - The risk management and internal control systems are designed to provide reasonable assurance against material misstatement or loss, rather than absolute assurance[113]. Environmental, Social, and Governance (ESG) - The company has established clear pollutant discharge standards and has not found any violations of environmental protection laws during the year[134]. - The Group has established an ESG governance framework focusing on occupational health and safety, waste gas and wastewater emissions, and production waste management[146]. - The company manufactured and donated disinfectants and other anti-epidemic materials to support communities during the COVID-19 pandemic[136]. Employee Management - The Group has a dynamic system for managing hazardous chemicals, including emergency response plans[165]. - In 2021, the Group arranged for 2,116 employees to receive vocational training, an increase from 1,889 in 2020[175]. - The Group provides comprehensive employee benefits including endowment insurance, medical insurance, and free meals[187].

Financial Performance - Revenue for the six months ended June 30, 2021, was HK$2,271,500,000, an increase from HK$1,381,714,000 in the same period last year, representing a growth of 64.4%[6] - Gross profit for the same period was HK$1,018,084,000, compared to HK$443,400,000 in the previous year, indicating a significant increase of 129.1%[6] - Profit for the period reached HK$587,028,000, up from HK$156,213,000, marking an increase of 274.5%[6] - Basic earnings per share were 71.2 HK cents, compared to 18.9 HK cents in the prior year, reflecting an increase of 276.7%[6] - Total comprehensive income for the period was HK$690,477,000, compared to HK$97,734,000 in the previous year, an increase of 605.5%[6] Revenue Breakdown - Revenue from caustic soda was HK$568,112,000, up from HK$532,594,000, representing a growth of 6.8%[27] - Revenue from chloromethane products increased significantly to HK$594,627,000 from HK$318,856,000, marking an increase of 86.2%[27] - The Group's revenue from the manufacture and sale of chemical products was HK$2,110,983,000, compared to HK$1,381,714,000, reflecting a growth of 52.9%[27] - Revenue from property sales amounted to HK$160,517,000, with no revenue recorded in the same period of the previous year[27] Expenses and Costs - Selling and distribution costs were HK$114,444,000, compared to HK$91,172,000 in the previous year, an increase of 25.5%[6] - Research and development costs amounted to HK$23,000,000, compared to HK$31,863,000 in the previous year, a decrease of 27.6%[6] - Cost of inventories recognized as expenses was HK$1,253,416,000, an increase of 33.5% from HK$938,314,000 in 2020[46] - General and administrative expenses increased to approximately HK$136 million, up by approximately HK$38 million from HK$98 million in the same period last year[92] Assets and Liabilities - As of June 30, 2021, total assets less current liabilities amounted to HK$5,709,739,000, an increase from HK$5,604,635,000 as of December 31, 2020, reflecting a growth of approximately 1.87%[8] - Net current assets decreased to HK$417,638,000 from HK$606,211,000, indicating a decline of about 30.97%[9] - The company's bank borrowings decreased significantly from HK$1,073,493,000 to HK$633,029,000, a reduction of approximately 41.05%[9] - Total equity increased to HK$5,014,124,000 from HK$4,443,564,000, representing a growth of around 12.83%[9] Cash Flow - For the six months ended June 30, 2021, net cash from operating activities was HK$674,829,000, a significant increase from HK$232,767,000 in the same period of 2020, representing a growth of approximately 189%[15] - The net cash used in investing activities was HK$397,945,000, up from HK$230,580,000 in the prior year, reflecting a rise of approximately 72.7%[15] - Cash and cash equivalents at the end of the period were HK$408,840,000, down from HK$422,683,000 at the beginning of the period, reflecting a decrease of about 3.5%[15] Shareholder Information - The company paid dividends totaling HK$136,125,000, compared to HK$123,750,000 in the same period last year, marking an increase of approximately 10%[15] - The interim dividend declared is HK$26.0 cents per share, compared to HK$7.5 cents per share in 2020[51] Corporate Governance - The company has complied with the Corporate Governance Code throughout the six months ended June 30, 2021[118] - The Audit Committee reviewed the Group's results for the period ended June 30, 2021, discussing accounting principles and internal controls[119] - The Remuneration Committee has been established with independent non-executive directors overseeing its authority and duties[120] - The Nomination Committee consists of independent non-executive directors, ensuring governance in board member selection[121] Future Outlook - The board expressed optimism about future growth and market expansion strategies[6] - The Group remains cautiously optimistic about future business prospects as COVID-19 vaccination rates increase globally, leading to a gradual relaxation of pandemic-related restrictions[86] - The Group aims to promote green manufacturing and achieve "Grade-A Safe Production Standardization Enterprise Certification" for sustainable returns to shareholders[89]

Financial Performance - For the year ended December 31, 2020, the Group recorded total revenue of HK$3,100 million, a decrease of 10.8% compared to the previous year[6]. - Net profit for the year was HK$503 million, representing a year-on-year decrease of 28.3%[6]. - The Group's gross profit margin was 36.5%, down by 3.4 percentage points year-on-year, while the net profit margin was 16.2%, down by 4.0 percentage points[6]. - Revenue for the year ended December 31, 2020, was HK$3,100 million, a decrease of 10.8% from HK$3,477 million in the previous year[18]. - Net profit attributable to equity holders for the same period was HK$503 million, down 28.3% from HK$701 million in the previous year[18]. - Basic earnings per share decreased to HK60.9 cents from HK84.9 cents in 2019[19]. - Average selling price per ton of caustic soda was approximately RMB630, a decrease of 26%[21]. - Gross profit margin decreased by 3.4 percentage points to 36.5% from 39.9% in the previous year[23]. - Selling and distribution costs amounted to approximately HK$201 million, a decrease of HK$14 million compared to HK$215 million last year[24]. - Administrative expenses increased to approximately HK$223 million, representing 7.2% of total revenue, up from 6.1% last year[28]. - Research and development costs were approximately HK$154 million, accounting for 5% of total revenue[30]. - Interest expenses decreased to approximately HK$56 million from HK$78 million in the previous year[30]. Operational Developments - The demand for chemical products stabilized in the second half of 2020, but prices remained low, impacting profitability[7]. - The Group remains cautiously optimistic about its operational prospects in 2021, focusing on cost-effectiveness and profitability improvement[8]. - The new factory in Gaolan Port, Zhuhai, producing lithium battery electrolyte additives commenced trial production in early 2021, expected to contribute revenue in 2021[13]. - The Group plans to diversify its lithium battery-related product lines to capture market opportunities and expand revenue sources[13]. Corporate Governance - The Board consists of 4 executive directors and 3 independent non-executive directors, with independent directors representing over one-third of the Board[49]. - The Company held 8 full board meetings during the year, with all directors attending the annual general meeting on April 24, 2020[52]. - All directors participated in continuous professional development, including reading regulatory updates and attending external seminars[56]. - The independent non-executive directors ensure effective corporate governance and meet specific independence criteria as required by the Listing Rules[48]. - The Audit Committee held 3 meetings during the year to review the Group's financial reporting and internal controls[63]. - The Remuneration Committee assessed the performance of executive Directors and senior management during the year[67]. - The Nomination Committee reviewed the structure, size, and composition of the Board to ensure a balance of expertise and experience[70]. Risk Management - The Group has established a risk management framework involving the Board of Directors, the Audit Committee, and the Risk Management Taskforce to monitor and manage risks effectively[85]. - The Risk Management Taskforce identifies and prioritizes significant risks at least annually, establishing risk mitigation plans and assigning risk owners[86]. - An independent professional advisor is engaged for internal audit services to assist in monitoring the risk management and internal control systems, with significant deficiencies reported to the Audit Committee and the Board[87]. - Risk management and internal control reports are submitted to the Audit Committee and the Board at least once a year, confirming the effectiveness of the systems[88]. Environmental, Social, and Governance (ESG) Initiatives - In 2020, the Group established clear and quantifiable sustainable development goals for environmental protection and occupational safety, ensuring compliance with various environmental laws[98]. - The Group manufactured and donated disinfectants and other anti-epidemic materials to surrounding communities during the COVID-19 outbreak, contributing to public health[100]. - The ESG management framework focuses on occupational safety, exhaust gas and sewage emissions, and operational waste, with a dedicated department for compliance and monitoring[104]. - The Group's ESG performance in the fiscal year 2020 was significantly enhanced due to the support and contributions from employees, partners, and stakeholders[108]. - The company emphasizes the importance of compliance with laws and regulations, including environmental protection and occupational health and safety, as key ESG topics[121]. Employee Engagement and Training - The workforce comprised around 2,100 employees, with a focus on competitive compensation and proper training[32]. - The Group provided free training for 655 employees to obtain special operation work permits across 34 areas, including pressure pipeline inspection and maintenance[165]. - A total of 1,889 employees received vocational training and relevant procedural skills training in 2020, an increase from 1,845 in 2019[166]. - The average training hours per person in 2020 was 74 hours, consistent with 2019[167]. - Employee turnover rate decreased from 19.31% in 2019 to 15.33% in 2020, with male turnover at 10.87% and female turnover at 4.45%[179]. Product Quality and Safety - The Group ensures that every batch of products undergoes testing in accordance with corporate and national standards before delivery[135]. - In 2020, the Group did not recall any products for safety and health reasons, indicating strong compliance with safety standards[130]. - Both factories of Lee & Man Chemical achieved ISO9001:2015, ISO14001:2015, and ISO45001:2018 certifications, ensuring high product quality standards[124]. - Jiangsu L&M Chemical won the Suzhou Quality Control Award in 2020 and was rated as a grade AA enterprise in quality and credit ranking[125]. Community Involvement - Employee engagement in sports and community activities, such as the "Good Life, Green Environment Cup" basketball competition, reflects the company's commitment to team spirit and community involvement[181].

Financial Performance - Revenue for the six months ended June 30, 2020, was HK$1,381,714,000, a decrease of 19.6% compared to HK$1,718,656,000 for the same period in 2019[8] - Gross profit for the period was HK$443,400,000, down 35.0% from HK$682,093,000 in the previous year[8] - Profit for the period was HK$156,213,000, representing a decline of 61.0% compared to HK$401,180,000 in the same period last year[8] - Basic earnings per share decreased to 18.9 HK cents, down from 48.6 HK cents in the prior year[8] - Total comprehensive income for the period was HK$97,734,000, significantly lower than HK$392,015,000 in the previous year[8] - The cost of sales for the period was HK$938,314,000, a reduction from HK$1,036,563,000 in the same period last year[8] - The total other income for the period was HK$41,570,000, a significant drop from HK$85,426,000 in 2019, indicating a decline of approximately 51%[36] - Selling and distribution expenses were approximately HK$91 million, a decrease of HK$16 million compared to the previous year, representing about 6.6% of total revenue[95] - General and administrative expenses increased to approximately HK$98 million, up by HK$14 million from the previous year, representing about 7.1% of total revenue[98] Assets and Liabilities - As of June 30, 2020, total assets less current liabilities increased to HK$5,077,187, up from HK$4,850,758 as of December 31, 2019, representing a growth of approximately 4.67%[10] - Net current assets rose significantly to HK$552,346, compared to HK$293,850 at the end of 2019, indicating an increase of about 88%[10] - Bank borrowings due after one year increased to HK$1,158,053 from HK$910,914, reflecting a rise of approximately 27%[10] - Total equity decreased slightly to HK$3,840,806 from HK$3,850,523, a decline of about 0.25%[10] - The company reported a decrease in cash and bank balances to HK$200,220 from HK$246,404, a reduction of approximately 18.75%[10] - Trade and other receivables increased to HK$309,075 from HK$290,527, showing a growth of about 6.5%[10] - The Group's outstanding bank borrowings as of 30 June 2020 were approximately HK$1,576 million, an increase from HK$1,498 million as of 31 December 2019[106] - The net debt-to-equity ratio was 35.81% as of 30 June 2020, compared to 32.52% as of 31 December 2019[106] Cash Flow - For the six months ended June 30, 2020, net cash from operating activities was HK$232,767,000, a decrease from HK$538,230,000 in the same period of 2019[16] - The company reported a net cash used in investing activities of HK$230,580,000, compared to HK$352,052,000 in the previous year[16] - The cash and cash equivalents at the end of the period were HK$200,220,000, down from HK$591,245,000 in the same period of 2019[16] - The company incurred payments for the purchase of property, plant, and equipment totaling HK$95,154,000[16] Market Outlook - The board of directors is optimistic about future market conditions and potential recovery in demand[7] - The Group expects the domestic chemical industry to bottom out soon, but the operating environment remains extremely challenging[84] Shareholder Information - The total equity as of June 30, 2020, was HK$3,850,523,000, with accumulated profits of HK$3,361,844,000[14] - The company paid dividends of HK$123,750,000, consistent with the previous year[16] - An interim dividend of HK$0.075 per share has been declared for the six months ended June 30, 2020[75] - The Register of Members will be closed from August 19, 2020, to August 24, 2020, for the purpose of the interim dividend[76] Governance and Compliance - The company has complied with the Corporate Governance Code throughout the six months ended June 30, 2020[121] - The Audit Committee reviewed the Group's unaudited interim financial statements for the six months ended June 30, 2020[122] - All members of the Board confirmed compliance with the Model Code regarding directors' securities transactions during the six months ended June 30, 2020[120] - The Remuneration Committee consists of independent non-executive directors, ensuring governance in compensation matters[123] - The Nomination Committee is chaired by Ms. Wai Siu Kee and includes three independent non-executive directors[124] Research and Development - The Group continues to invest in research and development for new products and process advancements despite a slight decrease in overall R&D spending[99] - Research and development costs for the year ended 30 June 2020 were approximately HK$59 million, a decrease of approximately HK$12 million compared to HK$71 million for the same period last year[99] Employee Information - The Group had a workforce of around 2,100 people as of 30 June 2020, with competitive salaries and annual reviews based on market conditions[108]

理 文 化 工 有 限 公 司 Lee & Man Chemical Company Limited (Incorporated in the Cayman Islands and its members' liability is limited) （於 開 受 群 島 注 冊 成 立 及 英 成 員 責 任 為 有 限 ） Stock Code 股份代號：746 Together We Grow ANNUAL oroco HCl CHCl3 NaOH REPORT NaClO HCl 年報 ST TO FOR THE FOR NaOH 104.45° 2019 Content 目錄 | --- | --- | --- | |---------------------------------------------------|--------------------------|-------| | | | | | CORPORATE INFORMATION | 公司資料 | 2 | | CHAIRMAN'S STATEMENT | 主席報告 | 4 | | MANAGEMENT DISCUSSION A ...

Financial Performance - Revenue for the six months ended June 30, 2019, was HK$1,718,656,000, a decrease of 11.98% from HK$1,953,247,000 in the same period of 2018[9] - Gross profit for the period was HK$682,093,000, down 28.38% from HK$952,419,000 in the previous year[9] - Profit for the period attributable to owners of the Company was HK$401,180,000, a decrease of 26.39% compared to HK$545,354,000 in 2018[10] - Basic earnings per share for the period was 48.6 HK cents, down from 66.1 HK cents in the same period last year[10] - Total comprehensive income for the period attributable to owners of the Company was HK$392,015,000, compared to HK$534,754,000 in 2018, reflecting a decline of 26.67%[10] - The profit for the period was impacted by a decrease in directors' emoluments to HK$26,027 from HK$27,378, a reduction of 4.9%[43] - The Group's net profit for the same period was approximately HK$401 million, representing a decrease of 26.4% year-on-year[92] Income and Expenses - Other income increased to HK$85,426,000 from HK$44,797,000, representing an increase of 90.67% year-on-year[9] - Finance costs decreased to HK$41,027,000 from HK$45,279,000, indicating a reduction of 9.93%[9] - The Group's current tax expense for the period was HK$61,554, down 37.9% from HK$99,093 in the same period of 2018[42] - Total staff costs increased to HK$153,506 from HK$145,480, reflecting a rise of 5.5%[43] - Selling and distribution expenses were approximately HK$107 million, representing 6.2% of total revenue, an increase from 5.6% in the previous period[95] - General and administrative expenses decreased to approximately HK$84 million, representing 4.9% of total revenue, compared to 5.4% in the same period last year[96] Assets and Liabilities - As of June 30, 2019, total assets less current liabilities amounted to HK$4,652,309,000, an increase from HK$4,513,593,000 as of December 31, 2018, reflecting a growth of approximately 3.1%[12] - Net current assets decreased to HK$138,033,000 from HK$194,857,000, indicating a decline of about 29.2%[12] - The company's net assets increased to HK$3,763,196,000, up from HK$3,478,665,000, representing a growth of approximately 8.2%[12] - Bank borrowings due within one year rose to HK$1,045,963,000 from HK$926,519,000, an increase of about 12.9%[12] - Inventories decreased significantly to HK$414,003,000 from HK$585,919,000, a reduction of approximately 29.3%[12] - Total trade and other payables amounted to HK$393.41 million, a decrease from HK$425.46 million at the end of 2018[59] Cash Flow - Net cash from operating activities for the six months ended June 30, 2019, was HK$538,230,000, an increase of 15.1% compared to HK$467,306,000 for the same period in 2018[14] - Net cash used in investing activities amounted to HK$352,052,000, up from HK$257,981,000 in the previous year, reflecting a significant increase in investment expenditures[14] - Net cash used in financing activities decreased to HK$185,782,000 from HK$317,382,000, indicating improved cash flow management in financing[14] - Cash and cash equivalents at the end of the period were HK$591,245,000, compared to HK$333,479,000 at the end of the same period last year, representing a substantial increase of 77.3%[14] - Dividends paid decreased to HK$123,750,000 from HK$165,000,000, reflecting a more conservative approach to cash distribution[14] Shareholder Information - As of June 30, 2019, Ms. Kwok Ching Yee Lorinda holds 495,000,000 shares, representing 60% of the issued share capital of the Company[115] - Dr. Lee Wan Keung Patrick holds 123,750,000 shares, representing 15% of the issued share capital of the Company[115] - The Company declared an interim dividend of HK$0.18 per share for the six months ended June 30, 2019, down from HK$0.23 per share in 2018, totaling HK$148.5 million compared to HK$189.75 million in the previous year[46] Compliance and Governance - The Company has complied with the Corporate Governance Code throughout the six months ended June 30, 2019[118] - All members of the Board confirmed compliance with the Model Code for Securities Transactions throughout the six months ended June 30, 2019[117] - The Audit Committee reviewed the Group's unaudited interim results for the six months ended June 30, 2019[119] - The Remuneration Committee and Nomination Committee have been established in compliance with the Code, consisting of independent non-executive directors[120][121] Strategic Initiatives - The Company continues to focus on enhancing its product offerings and market expansion strategies to drive future growth[8] - The Group plans to begin sales of commercialized hydrogen in the third quarter of 2019, contributing to the development of hydrogen fuel cells[87] - Trial production of internally-developed lithium battery electrolyte additives is expected to begin in December 2019[87] - The company continues to invest in production automation and intelligent management to counter rising human resource costs[88]

LEE & MAN CHEMICAL COMPANY LIMITED 理文化工有限公司 Stock Code 股份代號：746 Together We Grow ANNUAL crosb HCL CHCl3 NaOH REPORT NaClO HCL 年報 NaOH 104.45° 2018 (Incorporated in the Cayman Islands with Iimited liability) (於開曼群島註冊成立之有限公司) Content 目錄 | --- | --- | --- | |--------------------------------------------------------------------------|--------------------------|-------| | | | | | CORPORATE INFORMATION | 公司資料 | 2 | | CHAIRMAN'S STATEMENT | 主席報告 | 4 | | MANAGEMENT DISCUSSION AND ANALYSIS | 管理層討論及分析 | 6 | | CORPORAT ...