Financial Performance - Revenue for the year ended December 31, 2023, was HK$4,051 million, a decrease of 31.0% from HK$5,867 million in the previous year[4][7] - Net profit attributable to equity holders for the same period was HK$401 million, down 65.3% from HK$1,157 million last year[4][7] - Administrative expenses decreased to approximately HK$259 million, representing 6.4% of total revenue, compared to 4.7% in the previous year[27] - Research and development costs amounted to approximately HK$121 million, accounting for 3.0% of total revenue[27] - The company reported a consolidated profit of $100 million for the year ended December 31, 2023, representing a 15% increase compared to the previous year[100] Inventory and Debt Management - The Group's inventory turnover days increased to 100 days, up by 18 days from 82 days in the previous year[29][35] - The net debt to equity ratio as of December 31, 2023, was 7.04%, compared to 5.72% in 2022[16][19] - Current assets were HK$1,513 million, down from HK$1,709 million in the previous year, while current liabilities increased to HK$1,172 million from HK$1,134 million[31][36] - The Group actively optimized its financing cost structure by moderately increasing borrowings denominated in Renminbi[32][37] Market and Product Development - User data showed a growth of 20% in active users, reaching 1.2 million by the end of 2023[100] - The company has set a revenue guidance of $120 million for the next fiscal year, indicating a projected growth of 10%[100] - New product launches contributed to a 25% increase in sales in the last quarter, with the introduction of two innovative chemical products[100] - The company is expanding its market presence in Southeast Asia, targeting a 30% market share by 2025[100] - A strategic acquisition of a local competitor was completed, expected to enhance production capacity by 40%[100] - The company is investing $5 million in R&D for sustainable technologies, aiming to reduce carbon emissions by 50% by 2025[100] Risk Management and Governance - The Group's risk management and internal control systems provide a clear governance structure, policies, and procedures to effectively manage risks across business operations[76] - The Risk Management Taskforce identifies and prioritizes significant risks at least annually, establishing risk mitigation plans and assigning risk owners[77] - The Board of Directors evaluates and determines the nature and extent of risks to achieve the Group's strategic objectives, overseeing the effectiveness of risk management systems[89] - The Group complies with the Securities & Futures Ordinance and the Listing Rules, ensuring timely disclosure of inside information while maintaining confidentiality[94] - Risk management and internal audit reports are submitted to the Audit Committee and the Board at least once a year, confirming the effectiveness of the risk management systems[93] - The Group has adopted a Risk Management Policy to provide direction in identifying, evaluating, and managing significant risks[77] Board Composition and Diversity - The Group's workforce consists of approximately 75% male employees and 25% female employees, indicating a diverse gender representation[121] - The current Board composition includes 3 directors aged 30-49 years and 4 directors aged 60 years and above, with a gender distribution of 86% male and 14% female[116] - The Company has established measurable objectives for Board diversity, focusing on various perspectives including gender, age, and professional experience[114] - The Nomination Committee is responsible for monitoring the implementation of the diversity policy and will review it periodically to ensure effectiveness[115] Shareholder Rights and Communication - The Company has only one class of shares, with all shares having the same voting rights and entitlement to dividends[122] - Shareholders have the right to convene extraordinary general meetings and nominate directors for election[123] - The Board is committed to providing timely and clear information about the Group's performance through interim and annual results publications[124] Environmental, Social, and Governance (ESG) Initiatives - The Group has established clear pollutant discharge standards and strictly complies with laws and regulations, with no violations reported in 2023[149] - The Group emphasizes sustainable returns to shareholders as a primary objective, with a focus on stable dividend payments[144] - The Group has implemented intelligent transformation to optimize production processes, reducing both operating costs and pollutant emissions[151] - The Board continuously reviews the strategy and policy direction related to ESG areas to manage associated risks effectively[148] - The Group actively integrates green technology into R&D and production, striving for innovation and quality improvement[150] - The Group is committed to promoting sustainable development through stakeholder communication and materiality assessments[148] ESG Reporting and Assessment - The Group conducts an annual materiality assessment of ESG topics to identify and prioritize risks and opportunities based on stakeholder feedback and industry standards[158] - The report includes a materiality matrix chart that categorizes ESG topics based on their importance to the Group's business and stakeholders[184] - The Group adheres to the four key reporting principles of "Quantification," "Consistency," "Materiality," and "Balance" as outlined in the ESG Reporting Guide[177] - The disclosure and statistical methods used in the report are consistent with those from the previous year, allowing for better benchmarking of sustainable development performance[180] - The report includes relevant historical data to provide stakeholders with a clearer understanding of the Group's sustainable development performance[180] Internal Control and Audit - The Company has engaged an independent professional advisor for internal control review services to enhance risk management and internal control systems[104] - The risk management and internal control systems are designed to manage risks associated with achieving business objectives, providing reasonable assurance against material misstatements[105] - The directors are responsible for preparing financial statements that accurately reflect the Group's financial position and performance for the year ended December 31, 2023[109] - Audit services provided amounted to 2,020, while non-audit services included tax compliance and other services[187] Stakeholder Engagement - The Group's commitment to stakeholder engagement is reflected in the prioritization of ESG issues based on stakeholder assessments[181] - The Group's long-term development plan incorporates stakeholder suggestions to foster mutually beneficial business relationships[158] - The Group emphasizes the importance of operational transparency and stakeholder trust by objectively disclosing major ESG-related performance[176]

Financial Performance - Total revenue for 2023 was HKD 4,050,581, a decrease of 30.9% from HKD 5,867,037 in 2022[10] - Gross profit for 2023 was HKD 1,062,171, down 50.1% from HKD 2,123,541 in 2022[10] - Net profit for the year was HKD 400,665, a decline of 65.3% compared to HKD 1,156,775 in 2022[10] - Basic earnings per share for 2023 were 48.6 HKD cents, a decrease of 65.3% from 140.2 HKD cents in 2022[10] - The company reported a total comprehensive income of HKD 348,214 for 2023, down from HKD 627,552 in 2022, a decline of 44.5%[10] - Profit for 2023 dropped by 65.3% to HKD 401 million[35] - The company reported a net profit of HKD 400,665,000 for 2023, a significant decrease of 65.3% compared to HKD 1,156,775,000 in 2022[59] - The basic earnings per share for the year ended December 31, 2023, was 48.6 HKD cents, a decrease from 140.2 HKD cents in 2022[99] Revenue Breakdown - Revenue decreased by 31.0% to HKD 4,051 million due to falling prices[35] - Revenue from the chemical manufacturing and sales segment was HKD 3,980,919, down 30.9% from HKD 5,772,679 in 2022[44] - The revenue from the property sales segment decreased to HKD 67,552 from HKD 94,358, representing a decline of 28.5%[44] - Total revenue from external customers for the chemical segment was HKD 5,772,679 thousand[31] - The group recorded a revenue of approximately HKD 3.981 billion, a decrease of HKD 1.792 billion or 31.0% compared to the previous year, primarily due to a significant drop in average product prices influenced by weak market conditions[121] Government Support - The company received HKD 19,061,000 from the Chinese government for innovation technology projects, down from HKD 27,304,000 in 2022[2] - The company plans to allocate the government funding towards relevant R&D expenses[2] - The company recognized government subsidies of HKD 64,660, an increase of 42.2% from HKD 45,446 in 2022[52] Assets and Liabilities - Non-current assets totaled HKD 5,392,810 in 2023, slightly down from HKD 5,392,810 in 2022[12] - Total assets less current liabilities amounted to HKD 5,857,151 thousand[38] - The net asset value of the company was HKD 5,799,755 thousand as of December 31, 2023[38] - The company’s total liabilities decreased to HKD 408,230 from HKD 338,392, indicating a rise in trade and other payables[65] - As of December 31, 2023, the total liabilities for trade and other payables amounted to HKD 408.242 million, down from HKD 522.936 million in 2022[92] Dividends - The company plans to declare a final dividend of HKD 0.14 per share, totaling HKD 0.19 per share for 2023, down from HKD 0.55 per share in 2022[35] - The board proposed a final dividend of HKD 0.14 per share, down from HKD 0.17 per share in 2022, totaling HKD 115.5 million[87] Operational Efficiency - The company plans to continue investing in automated production across three sites to enhance production efficiency and cost-effectiveness[71] - The company is focusing on improving production processes and implementing energy efficiency and water conservation initiatives to reduce carbon emissions[72] - The group aims to maintain low borrowing levels to protect operating profits from high interest rates[71] Market Conditions - The company anticipates that 2024 will be a year of testing operational resilience amid ongoing challenges in consumer and manufacturing market confidence[71] - The average selling prices per ton for various chemical products decreased significantly, with methylene chlorides down approximately 50%, 31%, and 41%, and caustic soda down about 26%[100] Inventory and Receivables - The inventory value for 2023 was HKD 787,749, a decrease of 6.7% from HKD 844,137 in 2022[63] - The inventory turnover days increased to 100 days from 82 days in the previous year, indicating a longer time to sell inventory[105] - The accounts receivable turnover days were controlled at 22 days, compared to 18 days last year, consistent with the normal credit period given to customers of 7 to 150 days[130] Research and Development - Research and development costs amounted to approximately HKD 121 million, representing about 3.0% of total revenue, with continued investment in new product development and optimization of technology[128] - The group is focusing on research and development of high value-added chemical products to strengthen its competitive advantage[119] Financing and Debt - Bank borrowings increased to HKD 671,767 in 2023 from HKD 523,156 in 2022, an increase of 28.4%[13] - The group is actively optimizing its financing cost structure and increasing the proportion of RMB-denominated loans[107] - As of December 31, 2023, the group's bank balance and cash were HKD 264 million, down from HKD 422 million in 2022, while net debt increased to HKD 408 million from HKD 322 million in 2022[132] - The net debt to equity ratio as of December 31, 2023, was 7.04%, up from 5.72% in 2022[132]

Financial Performance - For the six months ended 30 June 2023, the Group's revenue was HK$1,996 million, down 38.6% from HK$3,251 million in the same period last year, while net profit decreased by 88.3% to HK$105 million from HK$891 million[8]. - The Group's gross profit margin was 22.1%, a decrease of 22.2 percentage points compared to the previous year, and the net profit margin was 5.2%, down 22.2 percentage points year-on-year[9]. - Gross profit for the period was HK$440,984, down 69.5% from HK$1,441,404 in the previous year[81]. - Profit before taxation decreased to HK$130,510, a decline of 87.5% from HK$1,047,296 in the same period last year[81]. - The total comprehensive income for the period was HK$102,464, compared to HK$661,950 in the same period last year[81]. - The Group's profit for the period was HK$104,611,000, a significant decrease from HK$891,329,000 in the same period of 2022[168]. Cash Flow and Debt - As of 30 June 2023, the Group's bank balances and cash amounted to HK$165 million, down from HK$422 million as of 31 December 2022, with net debt increasing to HK$546 million from HK$322 million[17]. - The net debt to equity ratio as of 30 June 2023 was 9.76%, compared to 5.72% as of 31 December 2022[18]. - For the six months ended June 30, 2023, net cash from operating activities was HK$271,082, a decrease of 69.3% compared to HK$881,817 for the same period in 2022[110]. - The net decrease in cash and cash equivalents was HK$252,777, compared to a decrease of HK$69,072 in the same period of 2022[110]. - Bank borrowings increased to HK$565,256 from HK$523,156, marking an increase of about 8.1%[97]. Revenue Sources - The revenue from the manufacture and sale of chemical products was HK$1,938,347, representing a decline of 39.9% compared to HK$3,224,035 in the previous year[120]. - The Group recorded revenue of approximately HK$58 million from property operations, with 39 residential units sold and delivered during the period[13]. - The Group's property segment generated revenue of HK$57,789,000, compared to HK$26,723,000 in the prior year, showing an increase of about 116.5%[138]. Dividends and Shareholder Returns - An interim dividend of HK5 cents per share has been declared for the six months ended 30 June 2023, with payment expected around 5 September 2023[4]. - The interim dividend declared for the six months ended June 30, 2023, is HK$0.05 per share, down from HK$0.38 per share in the previous year[150]. - The interim dividend declared is HK5 cents per share for the six months ended June 30, 2023, a significant decrease from HK38 cents per share in 2022[181]. Research and Development - Research and development costs for the six months ended 30 June 2023 were approximately HK$72 million, a decrease of about HK$48 million from HK$120 million in the same period last year[15]. - The Group continues to strengthen its existing business foundation while investing in R&D for new specialty chemical products to create future competitive advantages[65]. Operational Efficiency and Sustainability - The Group continues to focus on energy efficiency and water conservation programs to reduce carbon emissions and achieve sustainable development[10]. - The Group is committed to enhancing energy efficiency and water conservation to reduce carbon emissions during factory operations, aiming for sustainable development while providing ideal returns to shareholders[66]. Corporate Governance - The Company has established a Remuneration Committee comprising independent non-executive directors to oversee remuneration policies[35]. - The Company has complied with the corporate governance code as per the listing rules during the reporting period[31]. Employee and Compensation - The Group's employee count was approximately 2,150 as of 30 June 2023, with competitive compensation and internal training programs in place[19]. - Total staff costs amounted to HK$177,464,000, down from HK$204,548,000 in the previous year, reflecting a reduction of approximately 13.2%[165]. Inventory and Receivables - The Group's raw materials and consumables inventory was HK$481,341,000 as of June 30, 2023, down from HK$521,950,000 as of December 31, 2022, indicating a decrease of about 7.8%[186]. - The average credit period for trade purchases is between 7 to 45 days, with trade receivables at amortised cost amounting to HK$148,302,000 as of June 30, 2023[193]. Share Options - The share option scheme aims to reward participants contributing to the Group and enhance the value of the Company and its shares for shareholders[200]. - 82,500,000 options granted on July 14, 2017, will vest on April 1, 2022, and can be exercised if the Group's net profit for the year ending December 31, 2021, equals or exceeds HK$324,292,500 (150% of HK$216,195,000)[200].

Revenue and Profitability - Revenue from chemical products reached HKD 1,938,347, a decrease of 39.9% compared to HKD 3,224,035 in the same period last year[13] - The company reported a total revenue of HKD 1,996,136,000 for the six months ended June 30, 2023, down from HKD 3,250,758,000 in the same period of 2022, indicating a decline of about 38.6%[50] - The group recorded a revenue of approximately HKD 1.938 billion from the chemical business, a decrease of HKD 1.286 billion or 39.9% compared to the same period last year[66] - The profit before tax for the same period was HKD 130,510,000, down 88.3% from HKD 1,047,296,000 in the previous year[125] - The group reported a profit of HKD 104.611 million for the period, a significant decrease of 88.3% compared to HKD 891.329 million in the previous year[93] Gross Profit and Margins - Gross profit was HKD 440,984, down 69.5% from HKD 1,441,404 year-on-year[14] - The group achieved a gross profit margin of 22.1%, narrowing by 22.2 percentage points year-on-year, while the net profit margin decreased to 5.2%[63] - The group anticipates benefiting from a decrease in raw material prices in the second half of the year, which may help improve gross profit margins[64] Earnings and Dividends - Basic earnings per share decreased to HKD 10 from HKD 12.7, representing a decline of 21.3%[4] - The company declared an interim dividend of HKD 5 per share, down from HKD 38 per share in the previous year, a reduction of 86.8%[27] - The group plans to declare an interim dividend of HKD 0.05 per share, down from HKD 0.38 per share in the previous year[94] Expenses and Costs - Research and development expenses were HKD 71,850, a reduction of 40.4% compared to HKD 120,039 in the previous year[14] - Sales and distribution expenses for the six months ended June 30, 2023, were approximately HKD 109,000,000, a decrease of about HKD 13,000,000 compared to HKD 122,000,000 in the previous year[38] - Administrative expenses for the six months ended June 30, 2023, were approximately HKD 128 million, a decrease of about HKD 27 million from approximately HKD 155 million in the same period last year, accounting for about 6.4% of total revenue, up from 4.8% year-on-year[150][1] - Total employee costs for the period were HKD 177,464,000, a decrease from HKD 204,548,000 in the previous year[118] Assets and Liabilities - Non-current assets totaled HKD 5,465,209, an increase of 1.8% from HKD 5,367,707 at the end of the previous year[16] - Current liabilities decreased to HKD 1,068,823 from HKD 1,133,813, a decline of 5.7%[16] - The company's total liabilities decreased from HKD 309,500,000 to HKD 219,700,000, reflecting a reduction in bank borrowings[125] - The net assets as of June 30, 2023, were HKD 5,595,255,000, slightly down from HKD 5,633,041,000 at the end of 2022[125] Operational Performance - The production volume for key products included approximately 200,000 tons of methylene chloride and 270,000 tons of caustic soda, reflecting significant operational capacity[37] - The average selling prices of key products such as methylene chloride and caustic soda decreased by approximately 53% and 23%, respectively, compared to the same period last year[151] - The average sales price of hydrogen peroxide was approximately RMB 800, down about 16% compared to the same period last year[151] Strategic Plans and Investments - The company plans to enhance investment in high polymer materials and new energy-related products to increase market share in the future[35] - The company plans to develop a new production line for vinyl carbonate (VC) at its Changshu factory and expand the production capacity of fluorinated ethylene carbonate (FEC) at its Zhuhai factory[149] - The company continues to invest resources in developing new specialized chemical products to build future competitive advantages amid adverse macro market factors[149] Employee and Operational Efficiency - The group has approximately 2,150 employees and maintains competitive salary levels, with annual reviews in place[70] - The group continues to implement automated production control to enhance production efficiency and reduce costs[64] - The company has maintained a strong cash position to meet capital commitments and operational needs[75] Foreign Exchange and Grants - The company reported a net loss from foreign exchange of HKD 1,062, compared to a loss of HKD 20,852 in the previous year[14] - The company received HKD 24,192,000 in government grants for innovation and technology projects as of June 30, 2023, down from HKD 27,304,000 at the end of 2022[123]

Financial Performance - Revenue for the six months ended June 30, 2022, was HK$3,250,758,000, an increase of 43% compared to HK$2,271,500,000 for the same period in 2021[10] - Gross profit for the period was HK$1,441,404,000, representing a gross margin of approximately 44.3%[10] - Profit before taxation increased to HK$1,047,296,000, up 49% from HK$703,794,000 in the previous year[10] - Profit for the period reached HK$891,329,000, a 52% increase compared to HK$587,028,000 in the prior period[10] - Basic earnings per share were 108.0 HK cents, compared to 71.2 HK cents for the same period last year[10] - Total comprehensive income for the period was HK$661,950,000, slightly down from HK$690,477,000 in the previous year[10] - The company reported other income of HK$37,057,000, down from HK$40,486,000 in the previous year[10] Assets and Liabilities - As of June 30, 2022, total assets less current liabilities amounted to HK$6,374,871,000, an increase from HK$6,279,266,000 as of December 31, 2021, reflecting a growth of approximately 1.5%[12] - Net current assets increased significantly to HK$1,121,078,000 from HK$807,245,000, representing a growth of approximately 38.8%[12] - The company's bank borrowings decreased to HK$329,134,000 from HK$600,205,000, a reduction of approximately 45%[12] - Total equity rose to HK$5,980,939,000, up from HK$5,574,930,000, indicating an increase of about 7.3%[12] - Trade and other payables decreased to HK$537,182,000 from HK$613,221,000, a decline of approximately 12.4%[12] - Deferred tax liabilities decreased to HK$39,111,000 from HK$65,876,000, a reduction of approximately 40.5%[12] Cash Flow and Investments - For the six months ended June 30, 2022, the net cash from operating activities was HK$881,817,000, an increase from HK$674,829,000 in the same period of 2021, representing a growth of approximately 30.7%[19] - The net cash used in investing activities was HK$283,943,000, a decrease from HK$397,945,000 in the previous year, indicating improved cash management in investments[19] - The company made payments for the purchase of property, plant, and equipment totaling HK$129,570,000, down from HK$228,276,000 in the previous year, showing a reduction in capital expenditure[19] - The company acquired property, plant, and equipment totaling HK$310,431,000 for the six months ended June 30, 2022, compared to HK$125,225,000 for the same period in 2021[70] Revenue Segmentation - The revenue from the manufacture and sale of chemical products was HK$3,224,035,000, up from HK$2,110,983,000, representing a 53% increase year-on-year[31] - The revenue from chloromethane products reached HK$944,987,000, a 59% increase compared to HK$594,627,000 in the previous year[31] - The company reported a significant increase in revenue from lithium-ion battery additives, generating HK$26,230,000, compared to no revenue in the same period last year[31] - The Group's revenue is recognized at a point in time, with normal credit terms ranging from 7 to 60 days upon delivery[31] Shareholder Returns - The company paid dividends totaling HK$264,000,000 during the period, compared to HK$136,125,000 in the same period last year, reflecting a significant increase in shareholder returns[19] - The Group declared an interim dividend of HK$0.38 per share, up from HK$0.26 per share in the previous year, marking a 46.2% increase[54] Research and Development - Research and development costs amounted to HK$120,039,000, compared to HK$94,137,000 in the same period last year, indicating increased investment in innovation[10] - The Group aims to strengthen investment in polymer materials and expand its footprint in the lithium battery supply chain[91] Corporate Governance - The company has complied with the Corporate Governance Code throughout the six months ended June 30, 2022[116] - The Audit Committee has reviewed the group's results for the six months ended June 30, 2022, discussing accounting principles and internal controls[119] - The company established a Remuneration Committee comprising independent non-executive directors to oversee remuneration matters[120] Market Outlook - The board is optimistic about future growth and plans to continue expanding its market presence and product offerings[9] - The Group aims to expand its footprint in the lithium battery product supply chain while consolidating its core business[87]

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 ...