Financial Performance - The company's revenue for the fiscal year ended June 30, 2023, was approximately HKD 46,993,000, a decrease of 9% compared to HKD 51,776,000 in the previous year[3]. - The gross loss for the fiscal year was approximately HKD 1,268,000, compared to a gross profit of approximately HKD 4,455,000 in the previous year, resulting in a gross margin of -2.7%[11]. - The annual loss attributable to the company's owners was HKD 103,123,000, representing a 41% increase from HKD 73,009,000 in the previous year[3]. - The company reported a significant decline of approximately 78% in revenue from computer software and hardware development services, which was a major contributor to the overall revenue decrease[10]. - Revenue from the computer hardware and software development segment was approximately HKD 11,320,000, a decrease of about 78% compared to approximately HKD 51,776,000 in the previous year[15]. - The loss in the computer hardware and software development services segment increased to approximately HKD 98,266,000, up about 68% from a loss of HKD 58,516,000 in the previous year[36]. - The company reported a loss attributable to owners of approximately HKD 103,123,000 for the year, compared to a loss of HKD 73,009,000 in the previous year, representing an increase in loss of about 41.3%[23]. - The company reported a basic and diluted loss per share of HKD 0.078 for continuing operations, compared to HKD 0.055 in 2022[174]. - The company experienced a loss before tax from continuing operations of (HKD 117,785,000) in 2023, compared to a loss of (HKD 76,260,000) in 2022, reflecting a worsening financial performance[178]. Cash Flow and Assets - Cash and cash equivalents decreased by 12% to HKD 98,109,000 from HKD 111,639,000 in the previous year[3]. - The total assets of the company decreased by 54% to HKD 107,606,000 from HKD 233,916,000 in the previous year[3]. - As of June 30, 2023, the company's net current assets were approximately HKD 84,581,000, down from HKD 114,041,000 in the previous year, a decrease of about 25.8%[24]. - The company reported a cash flow from operating activities of (HKD 5,516,000) for the year ended June 30, 2023, compared to HKD 83,806,000 in the previous year, indicating a significant decline in operational cash flow[178]. - The company recorded a net cash outflow from financing activities of (HKD 7,261,000) in 2023, compared to (HKD 6,082,000) in 2022, indicating increased financial strain[179]. - The company’s cash and cash equivalents decreased by HKD 12,729,000 in 2023, resulting in a year-end balance of HKD 98,109,000, down from HKD 111,639,000 in 2022[179]. Impairment and Losses - The company recognized goodwill impairment loss of approximately HKD 18,289,000 and intangible asset impairment loss of approximately HKD 58,007,000, primarily related to a subsidiary in China[14]. - The company incurred an impairment loss of HKD 58,007,000 on intangible assets during the year[52]. - The company reported a significant impairment loss on goodwill of HKD 18,289,000 in 2023, down from HKD 43,991,000 in 2022, suggesting some improvement in asset valuation[178]. Operational Challenges - The company faced challenges due to the ongoing geopolitical tensions, inflationary pressures, and a slower-than-expected economic recovery in China[6]. - The strict lockdown measures and pandemic policies in China adversely affected business activities, leading to operational challenges for the subsidiary[16]. - The company anticipates facing various challenges in the upcoming fiscal year but remains cautiously optimistic about future economic growth in core markets[8]. - The group anticipates continued uncertainty and external adverse factors affecting its business due to geopolitical conflicts, global interest rates, and the unpredictable recovery of the Chinese economy post-COVID-19[37]. Corporate Governance - The company is committed to maintaining high levels of corporate governance, which is crucial for gaining and maintaining the trust of shareholders and stakeholders[51]. - The board of directors includes executive director Zhang Sanhua (Chairman and CEO) and independent non-executive directors Su Hanzhang, Zhou Chunsheng, and Tian Hong[53]. - The company has fully complied with the corporate governance code, except for the separation of roles between the Chairman and CEO, which is currently held by Zhang Sanhua[51]. - The attendance record for board meetings shows that all directors attended 100% of the meetings held during the year[55]. - The company has established clear written terms of reference for its board committees, including the audit, nomination, and remuneration committees[64]. - The company has established mechanisms to ensure the independence of non-executive directors, who have confirmed their independence[69]. - The company has a balanced mechanism in place to ensure that shareholders' interests are fairly reflected[51]. Shareholder Relations - The company emphasizes the importance of effective communication with shareholders to strengthen investor relations[101]. - The company’s investor relations policy aims to provide shareholders and potential investors with timely and understandable information[101]. - Shareholders have the right to submit written requests for special meetings if they hold at least 10% of the voting rights[96]. - The board of directors does not recommend the distribution of dividends for the current fiscal year, consistent with the previous year where no dividends were declared[113]. - The company has no predetermined dividend payout ratio, and past dividend distribution records do not serve as a reference for future dividends[112]. Employee and Director Compensation - Employee costs, including director remuneration, amounted to approximately HKD 22,230,000 for the year, down from approximately HKD 30,621,000 in the previous year[40]. - The remuneration policy for employees is based on performance, qualifications, and work capability, as determined by the board[135]. - The remuneration committee has reviewed the compensation policy for all directors and senior management based on operational performance and market statistics[135]. Risk Management - The company has established a comprehensive risk management and internal control system to identify and monitor business-related risks[83]. - The board is committed to managing and monitoring risks associated with its business activities, including environmental, social, and governance risks[83]. - The company has implemented a whistleblowing policy for employees and business partners to report any suspected misconduct[85]. - The risk management system includes regular updates and reviews of policies and procedures related to operational, financial, compliance, and risk monitoring[83]. Changes in Capital Structure - The company has changed its presentation currency from USD to HKD to better reflect its financial performance for shareholders and potential investors[132]. - The company has adopted a share option scheme to reward directors and eligible employees[136]. - The updated plan authorization allows the company to grant options for up to 132,670,173 shares, equivalent to about 10% of the issued shares as of the annual general meeting date[145]. - The total number of share options available for issuance under the updated plan is 132,670,173 shares, representing approximately 10% of the company's issued share capital as of the report date[148]. Audit and Compliance - The independent auditor's report confirmed that the consolidated financial statements fairly reflect the group's financial position as of June 30, 2023, in accordance with Hong Kong Financial Reporting Standards[162]. - The audit committee reviewed the accounting principles and practices adopted by the group, ensuring compliance with internal controls and financial reporting matters[157]. - The independent auditor, Crowe Horwath, will be proposed for reappointment at the upcoming annual general meeting[158].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不 負責，對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告 全部或任何部分內容而產生或因倚賴該等內容而引致之任何損失承擔任何責 任。 PINE TECHNOLOGY HOLDINGS LIMITED 松景科技控股有限公司* （於百慕達註冊成立之有限公司） （股份代號：1079） 截 至 二 零 二 三 年 六 月 三 十 日 止 年 度 全 年 業 績 公 告 松景科技控股有限公司（「本公司」，連同其附屬公司（統稱「本集團」））董事（「董 事」）會（「董事會」）謹此呈報本集團截至二零二三年六月三十日止年度（「本年度」） 的經審核綜合損益及其他全面收益表以及本集團於二零二三年六月三十日的 經審核綜合財務狀況表，連同截至二零二二年六月三十日止年度的比較數字 如下： 綜合損益及其他全面收益表 截至二零二三年六月三十日止年度 二零二三年 二零二二年 附註 千港元 千港元 （經重列） （附註1(c)及5） ...

Financial Performance - The group's revenue from continuing operations for the period was approximately $1,384,000, a decrease of about 69% compared to approximately $4,469,000 in the same period last year[6]. - The gross profit decreased by approximately 85% to about $227,000 from approximately $1,508,000 in the same period last year[7]. - The group recorded a loss attributable to owners of the company of approximately $2,276,000, an increase of about 367% compared to approximately $487,000 in the previous year[14]. - The total comprehensive loss for the period was $2,560,000, compared to a loss of $97,000 in the same period last year[70]. - The company reported a net cash inflow from operating activities of $648,000, a decrease from $3,760,000 in the previous year[71]. - The loss before tax from continuing operations for the six months ended December 31, 2022, was $2,461,000, compared to a loss of $949,000 for the same period in 2021, reflecting a worsening financial performance[86]. - The company reported a loss attributable to owners of the company of $2,276,000 for the six months ended December 31, 2022, compared to a loss of $487,000 for the same period in 2021[93]. Cost and Expenses - The cost of sales for the group was approximately $1,157,000, down about 61% from approximately $2,961,000 in the previous year[7]. - The division incurred a loss of approximately $949,000, an increase of about 524% compared to a profit of approximately $224,000 in the same period last year[29]. - The total employee cost was approximately $1,397,000, down from approximately $1,897,000 in the same period last year[34]. - The company’s total unallocated corporate expenses for the six months ended December 31, 2022, were $1,498,000, compared to $1,122,000 in the same period of 2021[83][85]. - The company incurred an intangible asset amortization expense of $741,000 for the six months ended December 31, 2022[86]. - The depreciation expense for property, plant, and equipment was $89,000 for the six months ended December 31, 2022, down from $122,000 in the same period of 2021[86]. Assets and Liabilities - As of December 31, 2022, the group's current assets net value was approximately $13,086,000, down from approximately $14,621,000 as of June 30, 2022[15]. - Current liabilities decreased to $2,450,000 from $3,815,000, showing improved short-term financial health[68]. - Total equity as of December 31, 2022, was $22,470,000, down from $24,838,000, reflecting the impact of losses on shareholder equity[68]. - Non-current assets decreased to $10,883,000 from $11,553,000, indicating a reduction in long-term investments[67]. - Trade receivables net amount increased to $830,000 as of December 31, 2022, from $200,000 as of June 30, 2022[96]. - The company reported total trade payables of $1,134,000 as of December 31, 2022, down from $1,871,000 as of June 30, 2022[101]. Financing and Capital Structure - The group’s bank borrowings as of December 31, 2022, were approximately $215,000, a significant decrease of about 71% from approximately $753,000 as of June 30, 2022[15]. - The capital debt ratio as of December 31, 2022, was approximately 15%, down from about 17% as of June 30, 2022[20]. - The company has not entered into any new loan agreements since September 2021, leading to the decision to not renew its lending license[99]. - The company maintained a healthy financial condition with a low capital debt ratio despite the adverse effects of the COVID-19 pandemic[23]. Business Operations - The trade business did not generate any revenue during the period, compared to a loss of approximately $4,000 in the same period last year[28]. - The company has ceased its lending business as of September 29, 2022, and has reclassified the performance of this segment as discontinued operations, impacting the comparability of financial data[79]. - The board decided not to extend the lending license that expired on September 29, 2022, and to terminate the lending services business segment[24]. - There were no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the period[31]. Shareholder Information - Major shareholder Mingzhi Global holds 714,163,680 shares, representing 53.83% of the issued share capital[42]. - The company has granted 80,140,000 share options at an exercise price of HKD 0.46 per share[45]. - As of December 31, 2022, there are 16,860,000 unexercised share options remaining under the share option plan[50]. - The total number of share options outstanding at the end of the period is 72,640,000[54]. - The company did not recommend the payment of an interim dividend for the period[36]. - The company did not declare or recommend any dividends for the current period, consistent with the previous period[89]. Governance and Compliance - The company has complied with all provisions of the Corporate Governance Code, except for C.2.1 and B.2.2, regarding the separation of roles between the Chairman and CEO[57]. - The Audit Committee, consisting of three independent non-executive directors, has reviewed the interim financial statements and found them to be prepared in accordance with applicable accounting standards[61]. - The company has confirmed that all directors have complied with the required standards of the Corporate Governance Code throughout the period[60]. - The company believes that the current structure of having the same person serve as both Chairman and CEO is beneficial for effective strategy implementation[57]. Market Outlook - The company remains cautiously optimistic about business recovery in the coming years as COVID-19 restrictions are gradually lifted[30]. - Future outlook and performance guidance details are not included in the content[104].

Financial Performance - The company's revenue for the fiscal year ended June 30, 2022, was approximately $7,817,000, a decrease of about 36% compared to $12,219,000 in the previous year[4]. - The gross profit margin fell to 22% from 36% year-on-year, with gross profit decreasing to approximately $1,750,000 from $4,392,000, a decline of about 60%[7]. - The annual loss for the company was approximately $8,443,000, compared to a loss of $2,091,000 in the previous year, representing an increase of 304%[4]. - The company reported an operating loss of $8,542,000, compared to an operating loss of $1,963,000 in the previous year, indicating a significant increase in losses[160]. - The annual loss attributable to the company’s owners was $8,220,000, compared to a loss of $2,524,000 in the previous year, reflecting a 225.5% increase in losses[163]. - Total assets decreased to $26,174,000 from $35,657,000, a decline of 26.5% year-on-year[161]. - The company's net equity dropped to $24,838,000 from $33,393,000, representing a decrease of 25.7%[162]. - The basic and diluted loss per share for the year was $0.62, compared to $0.19 in the previous year, indicating a worsening financial position[160]. - Other comprehensive loss for the year totaled $112,000, contrasting with a comprehensive income of $249,000 in the previous year[160]. Cash Flow and Liquidity - Cash and cash equivalents increased significantly to $14,313,000, up 199% from $4,784,000 in the previous year[4]. - For the year ended June 30, 2022, the net cash generated from operating activities was $10,744 thousand, a significant increase from $649 thousand in the previous year, representing a growth of approximately 1,553%[164]. - The net cash inflow from financing activities was negative at $780 thousand, worsening from a negative $234 thousand in the previous year[165]. - The total cash and cash equivalents at the end of the reporting period increased to $14,313 thousand, up from $4,784 thousand, marking a growth of approximately 199%[165]. Goodwill and Impairment - The company recorded goodwill impairment losses of approximately $5,640,000, primarily related to a Chinese subsidiary's goodwill[17]. - A goodwill impairment loss of USD 5,640,000 was recorded in the profit and loss statement for the year ended June 30, 2022, significantly impacting the consolidated financial statements[152]. - The company experienced a significant impairment loss of goodwill amounting to $5,640 thousand during the year, which was not present in the previous year[164]. Cost Management - General and administrative expenses decreased by about 42%, from approximately $7,287,000 to $4,259,000, due to strict cost control measures[19]. - Employee costs, including director remuneration, amounted to approximately $3,926,000 this year, down from about $5,981,000 last year[43]. - The company plans to introduce new products and services to expand its customer base and implement cost control policies to maintain competitiveness[8]. Corporate Governance - The company has adopted the new corporate governance code effective from January 1, 2022, ensuring compliance with the latest developments in corporate governance practices[57]. - The board of directors has confirmed adherence to the standard code of conduct for securities trading, with all directors affirming compliance throughout the year[58]. - The company has maintained high standards of corporate governance to protect shareholder interests and enhance corporate value[57]. - The board consists of executive and independent non-executive directors, with a total of at least three independent non-executive directors, representing at least one-third of the board[62][63]. - The company is committed to ongoing compliance with the listing rules and corporate governance standards set by the exchange[58]. Market and Economic Conditions - The company will continue to assess the impact of COVID-19 on its financial condition and operating performance, adjusting its business strategies accordingly[8]. - The board anticipates a challenging economic environment due to ongoing COVID-19 impacts, rising global interest rates, and geopolitical uncertainties, particularly from the Russia-Ukraine conflict[40]. - The company faces potential trade restrictions and tariffs between the US and China, which could increase product costs and impact consumer confidence[98]. Shareholder Relations - The company emphasizes high transparency in communication with shareholders, maintaining ongoing dialogue through annual general meetings and financial reports[92]. - The company is committed to ensuring that shareholders can easily access fair and understandable information about its performance and strategies[92]. - The company has a responsibility to notify shareholders of any formal motions proposed for the upcoming annual general meeting if requested by a certain percentage of shareholders[91]. Audit and Compliance - The Audit Committee held two meetings this year to review the annual financial performance and reports, as well as the interim results for the six months ending December 31, 2021[72]. - The independent auditor's report confirmed that the consolidated financial statements fairly reflect the group's financial position as of June 30, 2022[149]. - The company has implemented internal controls deemed necessary for the preparation of consolidated financial statements[156]. Stock Options and Employee Benefits - The company has a stock option plan that allows for the issuance of options to purchase up to 132,670,173 shares, representing approximately 10% of the issued shares as of the date of the shareholders' annual meeting[127]. - The exercise price for options granted under the plan is set at HKD 0.46 and HKD 0.83, with a total of 80,140,000 options granted at the exercise price of HKD 0.46[126]. - The remuneration policy for employees is based on performance, qualifications, and work capability, with the board determining the compensation for directors and senior management[140].

[Company Information](index=3&type=section&id=Company%20Information) The board comprises executive and independent non-executive directors, with Mr. Zhang Sanhuo serving as Chairman and CEO - The Board of Directors consists of executive directors Mr. Zhang Sanhuo (Chairman and Chief Executive Officer) and Mr. Chen Zhuohao, and independent non-executive directors Mr. Su Hanzhang, Mr. Zhou Chunsheng, and Mr. Tian Hong[3](index=3&type=chunk) - The Company has an Audit Committee, a Remuneration Committee, and a Nomination Committee, each with a clearly defined chairman and members[3](index=3&type=chunk) - The Company's stock code is 1079, with its registered office in Bermuda and its principal place of business in Central, Hong Kong[3](index=3&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) This section reviews the Group's business performance, financial position, and future outlook [Business Review](index=4&type=section&id=Business%20Review) The global economy, impacted by COVID-19, led to a general slowdown in Group business activities and a cautious market approach - The global economic environment continued to be affected by the COVID-19 pandemic, with major economies implementing social distancing, lockdown, and quarantine measures[6](index=6&type=chunk) - The Group adopted a cautious approach to its business to cope with global market changes, resulting in a general slowdown in business activities[6](index=6&type=chunk) [Prospects](index=4&type=section&id=Prospects) Management anticipates unknown challenges, but the Group will advance business plans and seek tech investments for long-term value - Management expects the Group's business to face more unknown challenges from the COVID-19 pandemic[7](index=7&type=chunk) - The Group will steadily advance its business plans and actively seek technology-related investment opportunities to expand its business and create long-term value[7](index=7&type=chunk) [Financial Review](index=5&type=section&id=Financial%20Review) Group revenue decreased by **39%** to **5.258 million USD**, but gross margin improved to **44%**, reducing losses and improving basic loss per share [Performance Review](index=5&type=section&id=Performance%20Review) This section details the Group's financial performance, including revenue, gross margin, operating expenses, and net loss | Indicator | Current Period (thousand USD) | Prior Period (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 5,258 | 8,652 | -39% | | Gross Margin | 44% | 29% | +15 ppts | | Operating Expenses | 2,422 | 4,694 | -48% | | Loss Before Income Tax | 188 | 1,173 | -84% | | Loss Attributable to Owners of the Company | 487 | 1,340 | -64% | | Basic Loss Per Share (US cents) | 0.04 | 0.1 | -60% | [Segment Information](index=6&type=section&id=Segment%20Information) This section breaks down revenue and profit/loss by business segment, highlighting performance across operational areas | Segment | Current Period Revenue (thousand USD) | Prior Period Revenue (thousand USD) | Change (%) | Current Period Profit/Loss (thousand USD) | Prior Period Profit/Loss (thousand USD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Group Branded Products | 0 | 2 | -100% | 0 | (1,527) | | Other Branded Products | 0 | 4,294 | -100% | 0 | (403) | | Money Lending Services | 789 | 574 | +37% | 761 | 1,404 | | Trading Business | 0 | 0 | 0% | (4) | (6) | | Computer Software, Hardware and System Development Services | 4,469 | 3,782 | +18% | 224 | 621 | [Liquidity, Financial Resources and Group Assets Pledged](index=7&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Group%20Assets%20Pledged) The Group maintained robust liquidity, with cash and bank balances up **81.8%** to **8.7 million USD**, and no pledged trade receivables | Indicator | December 31, 2021 (thousand USD) | June 30, 2021 (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 8,700 | 4,784 | +81.8% | | Bank Borrowings | 1,833 | 1,497 | +22.4% | | Total Current Assets | 21,428 | 20,484 | +4.6% | | Total Current Liabilities | 4,805 | 3,959 | +21.4% | | Current Ratio | 4.5 | 5.2 | -13.5% | | Gearing Ratio | 15.8% | 15.7% | +0.1 ppts | - As of December 31, 2021, no trade and other receivables were pledged as collateral for general banking facilities granted to the Group (June 30, 2021: approximately **185,000 USD**)[19](index=19&type=chunk) - The Company did not conduct any fundraising activities through the issuance of new shares during the first six months of this financial year[20](index=20&type=chunk) [Financial Policy](index=7&type=section&id=Financial%20Policy) The Group funds operations via internal cash flows and bank financing, maintaining prudent financial management - The Group finances its operations through internally generated cash flows and bank financing provided by banks[21](index=21&type=chunk) - The Group continues to maintain prudent measures in managing its financial requirements[21](index=21&type=chunk) [Share Capital and Capital Structure of the Company](index=7&type=section&id=Share%20Capital%20and%20Capital%20Structure%20of%20the%20Company) As of December 31, 2021, the Company had **1,326,701,739** issued ordinary shares at **HKD 0.1** par value, unchanged from June 30, 2021 - As of December 31, 2021, the Company had **1,326,701,739** issued ordinary shares with a par value of **HKD 0.1** each[22](index=22&type=chunk) - The number of issued shares remained consistent with that as of June 30, 2021[22](index=22&type=chunk) [Foreign Exchange Risk](index=8&type=section&id=Foreign%20Exchange%20Risk) The Group primarily transacts in USD, HKD, CAD, and RMB, maintaining currency balance without hedging, and directors deem foreign exchange risk acceptable - The Group primarily conducts buying and selling transactions in United States Dollars, Hong Kong Dollars, Canadian Dollars, and Renminbi[23](index=23&type=chunk) - The Group's policy is to maintain a balance in its buying and selling activities in the same currencies and has not entered into any foreign exchange hedging arrangements[23](index=23&type=chunk) - The Directors believe that the Group's transaction risk in currencies other than its functional currency remains at an acceptable level[23](index=23&type=chunk) [Major Investments and Material Acquisitions and/or Disposals](index=8&type=section&id=Major%20Investments%20and%20Material%20Acquisitions%20and%2For%20Disposals) During the period, the Group held no major investments and undertook no material acquisitions or disposals - During the period, the Group held no major investments[24](index=24&type=chunk) - During the period, the Group also had no material acquisitions and/or disposals of subsidiaries, associates, and joint ventures[24](index=24&type=chunk) [Future Plans for Material Investments or Capital Assets](index=8&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of December 31, 2021, the Group had no future plans for material investments or capital assets - As of December 31, 2021, the Group had no plans for any material investments or capital assets[25](index=25&type=chunk) [Employees and Remuneration Policy](index=8&type=section&id=Employees%20and%20Remuneration%20Policy) The Group's employee count increased by **9%** to **117**, with remuneration based on market and performance, and staff costs decreased by **52.1%** | Indicator | December 31, 2021 | June 30, 2021 | Change (%) | | :--- | :--- | :--- | :--- | | Number of Employees | 117 | 107 | +9% | | Staff Costs (Current Period) | 1,897 thousand USD | 3,968 thousand USD (Prior Period) | -52.1% | - The Group ensures that its employees' remuneration is determined based on prevailing human resources market conditions, individual performance, qualifications, and experience, and regularly reviews its remuneration policy[26](index=26&type=chunk) - Employee benefits include medical coverage, insurance plans, retirement benefit schemes, discretionary bonuses, and an employee share option scheme[26](index=26&type=chunk) [Contingent Liabilities](index=8&type=section&id=Contingent%20Liabilities) As of December 31, 2021, the Group had no material contingent liabilities - As of December 31, 2021, the Group had no material contingent liabilities[27](index=27&type=chunk) [Interim Dividend](index=8&type=section&id=Interim%20Dividend) The Board does not recommend the payment of an interim dividend for the current period - The Directors do not recommend the payment of an interim dividend for the current period[28](index=28&type=chunk) [Other Information](index=9&type=section&id=Other%20Information) This section covers directors' and major shareholders' interests, the share option scheme, profit guarantee, corporate governance, and other disclosures [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures](index=9&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) Directors and the chief executive hold long positions in shares and underlying shares, including Mr. Zhang Sanhuo (**53.83%** and **1.27%**) and Mr. Chen Zhuohao (**1.45%**) | Director Name | Nature of Interest | Number of Shares Held (shares) | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Zhang Sanhuo | Controlled Corporation (Smart Global) | 714,163,680 | 53.83% | | Mr. Zhang Sanhuo | Share Options (Beneficial Owner) | 16,860,000 | 1.27% | | Mr. Chen Zhuohao | Share Options (Beneficial Owner) | 19,260,000 | 1.45% | - All issued shares held by Smart Global are pledged as collateral for financing granted to Smart Global[30](index=30&type=chunk) [Major Shareholders' Interests in Securities](index=11&type=section&id=Major%20Shareholders%27%20Interests%20in%20Securities) Major shareholder Smart Global (wholly owned by Mr. Zhang Sanhuo) holds **53.83%** of pledged shares, with other entities and Simply Perfect Group Limited (**15%** in a subsidiary) holding interests | Major Shareholder Name | Capacity | Number of Shares Held (shares) | Position | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | :--- | | Smart Global | Beneficial Owner | 714,163,680 | Long/Short Position | 53.83% | | Nan Zhen | Controlled Corporation | 714,163,680 | Long/Short Position | 53.83% | | Hammer Capital Private Investments Limited | Person with a security interest in shares | 714,163,680 | Long Position | 53.83% | | Zhang Shaohui | Controlled Corporation | 714,163,680 | Long Position | 53.83% | | Zeng Lingqi | Controlled Corporation | 714,163,680 | Long Position | 53.83% | | Simply Perfect Group Limited (PINE Technology (BVI) Limited) | Beneficial Owner | 1,725 (PINE Technology (BVI) Limited) | Long Position | 15% (PINE Technology (BVI) Limited) | - All shares held by Smart Global are pledged as collateral for financing granted to Smart Global[37](index=37&type=chunk) - **74%** of the share capital of Simply Perfect Group Limited is beneficially owned by Mr. Zhao Hengtai, a former executive director of the Company[37](index=37&type=chunk) [Share Option Scheme](index=13&type=section&id=Share%20Option%20Scheme) The Company's share option scheme, adopted in 2013 and revised in 2018, incentivizes directors and employees, is valid until 2023, has a **10%** limit, and saw no activity this period - The share option scheme was adopted in 2013 and revised in 2018, aiming to provide incentives or rewards to directors, eligible employees, or individuals who have contributed to the Group[38](index=38&type=chunk) - The share option scheme will continue until November 21, 2023[38](index=38&type=chunk) - After updating the scheme's authorized limit, the Company may grant share options for up to **132,670,173** shares, representing approximately **10%** of the issued shares[42](index=42&type=chunk)[47](index=47&type=chunk) | Grantee | Position | Grant Date | Exercise Price (HKD) | Unexercised Options as of July 1, 2021 (units) | Unexercised Options as of December 31, 2021 (units) | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Zhang Sanhuo | Chairman and CEO | September 22, 2017 | 0.83 | 6,000,000 | 6,000,000 | | Mr. Zhang Sanhuo | Chairman and CEO | December 12, 2018 | 0.46 | 10,860,000 | 10,860,000 | | Mr. Chen Zhuohao | Executive Director | September 22, 2017 | 0.83 | 6,000,000 | 6,000,000 | | Mr. Chen Zhuohao | Executive Director | December 12, 2018 | 0.46 | 13,260,000 | 13,260,000 | | Other Grantees | Consultant | December 12, 2018 | 0.46 | 36,520,000 | 36,520,000 | | **Total** | | | | **72,640,000** | **72,640,000** | - For the six months ended December 31, 2021, no share options under the scheme were granted, exercised, cancelled, or lapsed, and no share-based payment expenses were recognized[47](index=47&type=chunk) [Profit Guarantee](index=17&type=section&id=Profit%20Guarantee) Changyu Group's third-period profit guarantee was achieved, with audited consolidated post-tax profit not less than **HKD 16,500,000** - The audited consolidated post-tax profit for Changyu Group's third-period profit guarantee was not less than **HKD 16,500,000**[48](index=48&type=chunk) - The third-period profit guarantee has been achieved[48](index=48&type=chunk) [Corporate Governance Code](index=18&type=section&id=Corporate%20Governance%20Code) The Company complied with the old Corporate Governance Code, except for combined Chairman/CEO roles and directors' rotation, believing the structure provides strong leadership - The Company has complied with all code provisions set out in the old Corporate Governance Code throughout the current period, except for code provisions A.2.1 and A.4.2[50](index=50&type=chunk) - The roles of Chairman and Chief Executive Officer are held by Mr. Zhang Sanhuo, constituting a deviation from code provision A.2.1 (new code C.2.1), but the Company believes this structure benefits consolidated and consistent leadership[50](index=50&type=chunk)[51](index=51&type=chunk) - The provisions for directors' rotation deviate from code provision A.4.2 (new code B.2.2), and the Company intends to comply by having one-third of all directors retire by rotation every three years[52](index=52&type=chunk) [Changes in Directors' Information](index=19&type=section&id=Changes%20in%20Directors%27%20Information) Executive Director Mr. Chen Zhuohao was appointed as an independent non-executive director of EPS Creative Technology Group Limited effective July 9, 2021 - Executive Director Mr. Chen Zhuohao was appointed as an independent non-executive director of EPS Creative Technology Group Limited (stock code: 3860), effective July 9, 2021[55](index=55&type=chunk) [Directors' Securities Transactions](index=19&type=section&id=Directors%27%20Securities%20Transactions) All directors confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers throughout the period - All Directors have confirmed that they have complied with the required standards set out in the Model Code throughout the current period[56](index=56&type=chunk) [Audit Committee](index=19&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors, reviewed accounting principles, audit, risk management, internal controls, and financial reporting - The Audit Committee comprises three independent non-executive directors: Mr. Su Hanzhang (Chairman), Mr. Zhou Chunsheng, and Mr. Tian Hong[57](index=57&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and discussed audit, risk management, internal control, and financial reporting matters (including reviewing the Group's unaudited condensed consolidated interim financial statements for the current period)[57](index=57&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=20&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period - During the period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[59](index=59&type=chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=21&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) This statement presents the Group's financial performance, showing a **39.2%** revenue decrease, improved gross margin, and reduced loss for the period and attributable to owners | Indicator | Six Months Ended December 31, 2021 (thousand USD) | Six Months Ended December 31, 2020 (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 5,258 | 8,652 | -39.2% | | Cost of Sales | (2,961) | (6,179) | -52.1% | | Gross Profit | 2,297 | 2,473 | -7.1% | | Gross Margin | 43.7% | 28.6% | +15.1 ppts | | Selling and Distribution Expenses | (162) | (170) | -4.7% | | General and Administrative Expenses | (2,260) | (4,524) | -50.0% | | Loss Before Income Tax | (188) | (1,173) | -84.0% | | Loss for the Period | (192) | (1,212) | -84.2% | | Loss Attributable to Owners of the Company | (487) | (1,340) | -63.7% | | Basic and Diluted Loss Per Share (US cents) | (0.04) | (0.10) | -60.0% | - Total comprehensive loss for the period was **97 thousand USD**, a significant reduction from **727 thousand USD** in the prior period[62](index=62&type=chunk) - Exchange differences arising from the translation of overseas operations resulted in **95 thousand USD** in other comprehensive income[62](index=62&type=chunk) [Condensed Consolidated Statement of Financial Position](index=23&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) This statement provides a snapshot of the Group's assets, liabilities, and equity, showing a **4.6%** increase in current assets, an **81.8%** increase in cash, and a slight decrease in total equity | Indicator | December 31, 2021 (thousand USD) | June 30, 2021 (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | 18,120 | 19,132 | -5.3% | | Current Assets | 21,428 | 20,484 | +4.6% | | Trade and Other Receivables | 2,216 | 4,729 | -53.1% | | Loans Receivable | 9,534 | 10,539 | -9.5% | | Bank Balances and Cash | 8,700 | 4,784 | +81.8% | | Current Liabilities | 4,805 | 3,959 | +21.4% | | Bank Borrowings (Current) | 1,833 | 881 | +108.1% | | Non-current Liabilities | 1,447 | 2,264 | -36.1% | | Net Assets (Total Equity) | 33,296 | 33,393 | -0.3% | - Goodwill remained unchanged at **7,985 thousand USD**, while intangible assets slightly decreased[66](index=66&type=chunk) - Net current assets increased from **16,525 thousand USD** to **16,623 thousand USD**[66](index=66&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=25&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) This statement details changes in the Group's equity components, including loss attributable to owners and non-controlling interests, and exchange reserve movements | Indicator | December 31, 2021 (thousand USD) | July 1, 2021 (thousand USD) | Change (thousand USD) | | :--- | :--- | :--- | :--- | | Equity Attributable to Owners of the Company | 26,138 | 26,534 | (396) | | Non-controlling Interests | 7,158 | 6,859 | 299 | | Total Equity | 33,296 | 33,393 | (97) | - Accumulated losses attributable to owners of the Company increased from **54,406 thousand USD** to **54,893 thousand USD**[69](index=69&type=chunk) - Exchange reserve increased from **199 thousand USD** to **290 thousand USD**[69](index=69&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=26&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This statement summarizes cash flows from operating, investing, and financing activities, showing improved operating cash flow and increased cash and cash equivalents | Indicator | Six Months Ended December 31, 2021 (thousand USD) | Six Months Ended December 31, 2020 (thousand USD) | Change (thousand USD) | | :--- | :--- | :--- | :--- | | Net Cash From/(Used In) Operating Activities | 3,760 | (2,547) | +6,307 | | Net Cash Used In Investing Activities | (9) | 0 | (9) | | Net Cash From Financing Activities | 123 | 4,502 | -4,379 | | Net Increase in Cash and Cash Equivalents | 3,874 | 1,955 | +1,919 | | Cash and Cash Equivalents at End of Period | 8,700 | 6,412 | +2,288 | - Net cash flow from operating activities shifted from a net outflow in the prior period to a net inflow in the current period, indicating improved operating performance[71](index=71&type=chunk) - Net cash from financing activities significantly decreased, primarily due to higher financing activities in the prior period[71](index=71&type=chunk) [Notes to the Condensed Consolidated Interim Financial Statements](index=27&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Statements) This section provides detailed explanations and disclosures for the interim financial statements, covering general information, accounting policies, and specific financial items [General Information](index=27&type=section&id=General%20Information) The Company is incorporated in Bermuda and listed in Hong Kong, with primary businesses including computer components, consumer electronics, money lending, trading, and software/system development - The Company was incorporated in Bermuda under the Companies Act, and its shares are listed and traded on the Main Board of The Stock Exchange of Hong Kong Limited[73](index=73&type=chunk) - The Group's principal businesses are the manufacturing and sale of quality computer components, consumer electronic products and others, provision of money lending services, trading business, and computer software, hardware and system development services[73](index=73&type=chunk) - The condensed consolidated interim financial statements are presented in United States Dollars, the functional currency of the Company[73](index=73&type=chunk) [Basis of Preparation and Principal Accounting Policies](index=27&type=section&id=Basis%20of%20Preparation%20and%20Principal%20Accounting%20Policies) The unaudited condensed consolidated interim financial statements are prepared under HKFRS 34 and HKEX Listing Rules, using consistent accounting policies with no significant impact from new HKFRS - The unaudited condensed consolidated interim financial statements have been prepared in accordance with the applicable disclosure requirements of the Rules Governing the Listing of Securities on the Stock Exchange and Hong Kong Accounting Standard 34 Interim Financial Reporting issued by the Hong Kong Institute of Certified Public Accountants[74](index=74&type=chunk) - The accounting policies and methods of computation used in the condensed consolidated interim financial statements for the current period are the same as those applied in the preparation of the Group's annual financial statements for the year ended June 30, 2021[74](index=74&type=chunk) - The adoption of new and revised Hong Kong Financial Reporting Standards will not result in any significant changes to the Group's accounting policies, the presentation of the consolidated financial statements, or the reported accounts[76](index=76&type=chunk) [Revenue and Segment Information](index=28&type=section&id=Revenue%20and%20Segment%20Information) The Group's operating segments include branded products, money lending, trading, and computer software/system development, with money lending and software/system development as primary 2021 revenue sources - The Group's operating segments include Group branded products, other branded products, money lending services, trading business, and computer software, hardware and system development services[77](index=77&type=chunk) | Segment | 2021 Revenue (thousand USD) | 2020 Revenue (thousand USD) | | :--- | :--- | :--- | | Group Branded Products | – | 2 | | Other Branded Products | – | 4,294 | | Money Lending Services | 789 | 574 | | Trading Business | – | – | | Computer Software, Hardware and System Development Services | 4,469 | 3,782 | - In 2021, neither the Group branded products nor other branded products segments generated any revenue[81](index=81&type=chunk) [Loss Before Income Tax](index=31&type=section&id=Loss%20Before%20Income%20Tax) Loss before income tax is calculated after deducting **741 thousand USD** for intangible asset amortization and **188 thousand USD** for depreciation, with no trade receivables impairment reversal this period | Indicator | Six Months Ended December 31, 2021 (thousand USD) | Six Months Ended December 31, 2020 (thousand USD) | | :--- | :--- | :--- | | Amortization of Intangible Assets | 741 | 741 | | Depreciation and Amortization | 188 | 203 | | Reversal of Impairment Loss on Trade Receivables | – | (206) | [Income Tax Expense](index=31&type=section&id=Income%20Tax%20Expense) Income tax expense for the period was **4 thousand USD**, primarily PRC enterprise income tax and deferred tax credits, with Hong Kong profits tax using a two-tiered rate and PRC subsidiaries at **25%** | Indicator | Six Months Ended December 31, 2021 (thousand USD) | Six Months Ended December 31, 2020 (thousand USD) | | :--- | :--- | :--- | | Hong Kong Profits Tax | – | 1 | | PRC Enterprise Income Tax | 114 | 161 | | Deferred Tax | (110) | (133) | | Total Income Tax Expense | 4 | 39 | - Hong Kong profits tax is calculated under a two-tiered profits tax rate regime, with the first **HKD 2,000,000** taxed at **8.25%** and the remainder at **16.5%**[88](index=88&type=chunk) - The tax rate for PRC subsidiaries is **25%**[88](index=88&type=chunk) [Dividends](index=32&type=section&id=Dividends) No dividends were paid or proposed during the current period - No dividends were paid or proposed during the current period[90](index=90&type=chunk) [Loss Per Share](index=32&type=section&id=Loss%20Per%20Share) Basic loss per share for the period was **0.04 US cents**, an improvement from the prior period, with all potential ordinary shares having an anti-dilutive effect - Basic loss per share attributable to owners of the Company was approximately **0.04 US cents**[91](index=91&type=chunk) - Basic loss per share is calculated based on the loss attributable to owners of the Company of approximately **487,000 USD** for the current period and the weighted average of **1,326,702,000** ordinary shares outstanding during the period[91](index=91&type=chunk) - During the current period, the effect of all potential ordinary shares was anti-dilutive[92](index=92&type=chunk) [Trade and Other Receivables](index=33&type=section&id=Trade%20and%20Other%20Receivables) Net trade receivables significantly decreased by **72.9%** to **820 thousand USD**, with credit terms of **1 to 180 days** and no pledged trade receivables | Indicator | December 31, 2021 (thousand USD) | June 30, 2021 (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Net Trade Receivables | 820 | 3,027 | -72.9% | | Deposits, Prepayments and Other Receivables | 1,396 | 1,702 | -17.9% | | Total Trade and Other Receivables | 2,216 | 4,729 | -53.1% | - The Group offers credit terms of **1 to 180 days** to its trade customers[94](index=94&type=chunk) - No trade and other receivables were pledged[94](index=94&type=chunk) [Loans Receivable](index=34&type=section&id=Loans%20Receivable) Fixed-rate loans receivable decreased by **9.5%** to **9.534 million USD**, are unsecured, bear **8% to 12%** annual interest, mature in **180 to 365 days**, and had no overdue amounts or impairment | Indicator | December 31, 2021 (thousand USD) | June 30, 2021 (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Fixed-rate Loans Receivable | 9,534 | 10,539 | -9.5% | - Unsecured loans receivable bear fixed annual interest rates ranging from **8% to 12%** and have maturity dates between **180 and 365 days**[96](index=96&type=chunk) - No loans receivable were overdue at the end of the reporting period, and the Directors believe no provision or impairment is necessary[96](index=96&type=chunk) [Trade and Other Payables](index=35&type=section&id=Trade%20and%20Other%20Payables) Trade payables increased by **39.5%** to **968 thousand USD**, while other payables decreased, resulting in a slight overall decrease, with a **30 to 60-day** average credit period | Indicator | December 31, 2021 (thousand USD) | June 30, 2021 (thousand USD) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Payables | 968 | 694 | +39.5% | | Accrued Expenses and Other Payables | 828 | 1,158 | -28.5% | | Total Trade and Other Payables | 1,796 | 1,852 | -3.0% | - The average credit period for goods purchased is **30 to 60 days**[98](index=98&type=chunk)

Financial Performance - The company's revenue for the fiscal year ended June 30, 2021, was approximately $12,219,000, a decrease of about 89% compared to $109,386,000 in the previous year[21]. - The gross profit turned from a loss of approximately $1,264,000 last year to a profit of approximately $4,392,000 this year[22]. - The net loss attributable to the company's owners was approximately $2,524,000, significantly reduced from $17,318,000 in the previous year[22]. - Operating expenses decreased by approximately 48% to about $7,734,000 from approximately $14,949,000 last year due to strict cost control measures[22]. - The company generated a cash net inflow from operating activities of $649,000, a decrease of $3,053,000 compared to $3,702,000 in the previous year[21]. - The company recorded other income of approximately $967,000 this year, compared to other losses of approximately $3,228,000 last year[22]. - Revenue from brand products decreased by approximately 100% to about $2,000 compared to approximately $55,369,000 in the previous year[32]. - Revenue from other brand products declined by approximately 89% to about $4,294,000 from approximately $39,740,000 in the previous year[33]. - Revenue from lending services increased by approximately 6% to about $1,163,000 from approximately $1,101,000 in the previous year, with profit rising by approximately 35% to about $993,000[34]. - Revenue from computer software and system development services decreased by approximately 2% to about $6,760,000 from approximately $6,868,000 in the previous year, with profit turning around to approximately $1,153,000[36]. Financial Position - The current ratio improved from 4 to 5.17, indicating better short-term financial health[24]. - The total current assets as of June 30, 2021, were approximately $20,484,000, down from $22,053,000 the previous year[24]. - Cash and bank balance increased from approximately $4,252,000 on June 30, 2020, to approximately $4,784,000 on June 30, 2021[25]. - Total liabilities decreased by approximately $1,231,000 or about 17% from June 30, 2020, totaling approximately $6,223,000 on June 30, 2021[25]. - The capital-to-debt ratio was approximately 16% as of June 30, 2021, compared to about 17% in the previous year[27]. Governance and Compliance - The company has a strong governance structure with independent non-executive directors overseeing audit and remuneration committees[52]. - The independent directors bring a wealth of experience from various sectors, enhancing the company's strategic decision-making capabilities[54]. - The company is committed to maintaining compliance with regulatory standards and improving its corporate governance practices[60]. - The company has complied with listing rules regarding the appointment of independent non-executive directors, ensuring that all independent directors meet the independence criteria as per rules 3.10(1), 3.10(2), and 3.10A[80]. - The audit committee held two meetings this year to review the annual financial performance and compliance procedures, as well as internal controls and risk management systems[89]. - The remuneration committee conducted one meeting to review the company's remuneration policies and the compensation of executive directors and senior management[91]. - The nomination committee held one meeting to assess the composition and independence of the board, as well as the qualifications of retiring directors for re-election[95]. - The company has established a board diversity policy to ensure a mix of skills, professional experience, and backgrounds among board members[85]. - The audit committee is responsible for reviewing the company's corporate governance policies and practices, ensuring compliance with legal regulations and standards[96]. Risks and Challenges - The company will continue to monitor the impact of the COVID-19 pandemic on its financial condition and operating performance[17]. - The board anticipates ongoing uncertainty and challenges in the global economy and retail environment[17]. - The future outlook remains uncertain due to the ongoing COVID-19 pandemic and geopolitical risks, impacting global economic recovery[37]. - The group faces risks related to the ongoing COVID-19 pandemic, which could impact supply chains and consumer demand[123]. Shareholder Information - The company has a total of 714,163,680 shares issued, with Zhang Sanhuo holding 53.83% through a controlled company[152]. - As of June 30, 2021, Zhang Sanhuo holds 16,860,000 shares, representing approximately 1.27% of the company's issued share capital[154]. - Chen Zhuohao holds 19,260,000 shares, which is about 1.45% of the company's issued share capital[154]. - The company has a stock option plan that allows for the issuance of up to 132,670,173 shares, equivalent to about 10% of the issued shares as of the annual general meeting date[160]. - The exercise price for stock options granted under the plan is set at HKD 0.46 per share[157]. - The stock option plan was adopted on November 22, 2013, and is set to expire on November 21, 2023[156]. - The company plans to have one-third of its directors retire at each annual general meeting to enhance corporate governance[151]. - The company has not entered into any service contracts with directors that would prevent termination within one year, excluding statutory compensation[148]. - The company’s stock options can be exercised at any time within a period not exceeding 10 years from the grant date[156]. - The company aims to provide rewards or incentives to directors and qualified employees through the stock option plan[156]. Audit and Financial Reporting - The independent auditor's report confirms that the consolidated financial statements fairly reflect the group's financial position as of June 30, 2021[186]. - The company is responsible for preparing true and fair consolidated financial statements according to Hong Kong Financial Reporting Standards and the Companies Ordinance[197]. - The board must assess the company's ability to continue as a going concern and disclose relevant matters unless liquidation or cessation of operations is intended[197]. - The auditor's goal is to obtain reasonable assurance that the consolidated financial statements are free from material misstatement due to fraud or error[198]. - Reasonable assurance is a high level of assurance but does not guarantee that all material misstatements will be detected[198]. - Material misstatements can arise from fraud or error and may influence economic decisions made by users of the financial statements[198].

Revenue Performance - The company's revenue for the period decreased by approximately 89% to about $8,652,000, down from approximately $77,389,000 in the same period last year[6]. - Revenue from the brand products segment dropped to about $2,000, a decrease of approximately 100% from about $42,408,000 in the previous year[16]. - Revenue from other brand products was approximately $4,294,000, down about 84% from approximately $26,313,000 in the same period last year[17]. - Revenue from computer software and system development increased by approximately 114% to about $3,782,000, compared to about $1,770,000 in the previous year[20]. - The lending services segment's revenue increased by about 4% to approximately $574,000, with a profit of about $1,404,000, up from approximately $386,000 in the previous year[18]. - Revenue for the six months ended December 31, 2020, was $8,652,000, a decrease of 88.8% compared to $77,389,000 for the same period in 2019[52]. - The group’s lending services segment generated revenue of $574,000, showing a slight increase compared to $553,000 in the previous period, indicating potential growth in this area[70]. Profitability and Loss - The gross profit for the period was approximately $2,473,000, a significant improvement from a gross loss of about $5,275,000 in the same period last year[12]. - The loss attributable to the company's owners was approximately $1,340,000, a reduction of about 89% from approximately $12,221,000 in the same period last year[13]. - The basic loss per share was approximately $0.1, compared to about $0.92 in the previous year[14]. - The net loss for the period was $1,212,000, a substantial reduction from the net loss of $14,408,000 in the previous year, reflecting a 91.6% improvement[54]. - The group incurred a loss before tax of $1,173,000 for the six months ended December 31, 2020, compared to a loss of $14,215,000 for the same period in 2019, indicating a reduction in losses[73]. Expenses and Cost Management - Operating expenses decreased by approximately 40% to about $4,786,000, down from about $7,947,000 in the previous year[12]. - Employee costs, including directors' remuneration, were approximately $3,968,000 for the period, down from approximately $4,452,000 in the same period last year[29]. - The total unallocated corporate expenses for the current period were $1,186,000, down from $1,773,000 in the previous period, reflecting improved cost management[70]. - The group’s tax expenses for the current period were $172,000, a decrease from $314,000 in the previous period, indicating a reduction in tax liabilities[74]. Financial Position - Cash and bank balances increased from approximately $4,252,000 on June 30, 2020, to approximately $6,412,000 on December 31, 2020[22]. - Total current assets rose to approximately $25,489,000 as of December 31, 2020, compared to approximately $22,053,000 on June 30, 2020[22]. - Current liabilities increased from approximately $5,510,000 on June 30, 2020, to approximately $8,506,000 on December 31, 2020[22]. - The current ratio decreased from 4 on June 30, 2020, to 3 on December 31, 2020[22]. - The debt-to-equity ratio based on total liabilities to total assets was approximately 24% as of December 31, 2020, up from 17% on June 30, 2020[23]. - The company’s total equity was $34,508,000 as of December 31, 2020, down from $35,235,000 as of June 30, 2020[57]. - The company’s inventory was reported as zero as of December 31, 2020, compared to $335,000 as of June 30, 2020, indicating a complete depletion of inventory[56]. Shareholder Information - Major shareholder Mingzhi Global holds 714,163,680 shares, representing 53.83% of the issued share capital[36]. - The company has a stock option plan allowing for the issuance of options for up to 132,670,173 shares, approximately 10% of the issued shares as of the annual general meeting date[39]. - The company’s major shareholders include Hammer Capital Private Investments Limited, which holds 714,163,680 shares[36]. - Simply Perfect Group holds a 15% stake in PINE Technology (BVI) Limited, a subsidiary of the company[38]. Corporate Governance - The company has complied with all provisions of the corporate governance code, except for specific clauses regarding the separation of roles between the chairman and the CEO[45]. - The company’s chairman and CEO roles are held by the same individual, which deviates from corporate governance guidelines[46]. - The company has appointed new independent non-executive directors in November and August 2020[47]. - The company’s audit committee consists of three independent non-executive directors, overseeing financial reporting and risk management[50]. Stock Options - As of December 31, 2020, there were 6,000,000 stock options granted to the Chairman and CEO, with an exercise price of HKD 0.83[40]. - The stock options granted in 2018 have an exercise price of HKD 0.46, with 10,860,000 options available[40]. - The company has a total of 72,640,000 stock options granted, with no options exercised, canceled, or lapsed in the six months ending December 31, 2020[41]. - The stock option plan is set to expire on November 21, 2023, unless cancelled or amended[38]. - There were no new stock options granted or exercised during the six months ending December 31, 2020[41]. Other Financial Metrics - The company recognized a foreign exchange gain of $485,000 during the period, contrasting with a loss of $139,000 in the previous year[54]. - The group reported a financing cash inflow of $4,502,000 for the six months ended December 31, 2020, compared to $2,278,000 in the same period of 2019, indicating increased financing activities[60]. - The company reported interest income of $1,000 for the current period, a slight decrease from $2,000 in the previous period[70]. - Trade receivables net amount was $1,931,000 as of December 31, 2020, down from $5,696,000 as of June 30, 2020[81]. - Fixed-rate loans receivable amounted to $10,489,000 as of December 31, 2020, compared to $9,888,000 as of June 30, 2020[83]. - Trade payables totaled $951,000 as of December 31, 2020, compared to $748,000 as of June 30, 2020[84].

Financial Performance - The company's revenue for the fiscal year ended June 30, 2020, was approximately $109.39 million, a decrease of about 35% from $167.07 million in the previous year[21]. - The gross loss for the year was approximately $1.26 million, a reduction of about 92% compared to the previous year's gross loss of $16.44 million[21]. - The annual loss attributable to the company's owners was approximately $17.32 million, down from $38.73 million in the previous year, representing a decrease of about 55%[23]. - Basic loss per share was $1.31, an improvement from $2.95 in the previous year, reflecting a reduction of about 56%[20]. - Operating expenses decreased by approximately $3.47 million or about 19% to approximately $14.95 million, primarily due to stricter cost control measures[21]. - The group reported revenue of $109,386,000 for the year ended June 30, 2020, a decrease of 34.5% compared to $167,070,000 in 2019[177]. - The cost of sales was $110,650,000, resulting in a gross loss of $1,264,000, compared to a gross loss of $16,444,000 in the previous year[177]. - Operating loss for the year was $18,793,000, significantly improved from an operating loss of $43,269,000 in 2019[177]. - The net loss for the year was $19,253,000, compared to a net loss of $43,499,000 in 2019, indicating a reduction in losses[177]. - The company reported a total comprehensive loss of $38,994 thousand for the year ended June 30, 2020, compared to a loss of $17,608 thousand in the previous year, indicating a significant increase in losses[185]. Assets and Liabilities - The company's current assets totaled approximately $22.05 million, down from $69.79 million in the previous year[24]. - Total assets decreased to $59,232,000 from $69,787,000 in the previous year, reflecting a decline of approximately 15.2%[179]. - The group's cash and cash equivalents were $4,252,000, down from $6,845,000 in 2019, representing a decrease of 37.8%[179]. - Non-current assets totaled $20,636,000, down from $23,118,000, a decline of 10.8%[179]. - The group’s equity attributable to owners decreased to $28,832,000 from $46,000,000, a drop of 37.2%[183]. - The company's distributable reserves as of June 30, 2020, included contributed surplus of $9,036,000 and retained earnings of $(51,588,000), totaling $(42,552,000)[123]. - The company's total liabilities increased, with bank borrowings repaid amounting to $6,134 thousand in 2020, compared to $7,036 thousand in 2019, indicating ongoing debt management efforts[190]. Cash Flow and Financing - The cash flow from operating activities for the year ended June 30, 2020, was $3,702 thousand, down from $6,030 thousand in the previous year, reflecting a decline in operational efficiency[188]. - The company experienced a net cash outflow from financing activities of $6,789 thousand in 2020, compared to $7,545 thousand in 2019, showing a slight improvement in cash management[190]. - The group's cash and bank balance decreased from approximately $6,845,000 on June 30, 2019, to about $4,252,000 on June 30, 2020[25]. Corporate Governance - The company has maintained high standards of corporate governance throughout the year, adhering to the principles outlined in the corporate governance code[62]. - All directors confirmed compliance with the standard code of conduct for securities trading throughout the year[63]. - The board consists of executive directors and independent non-executive directors, ensuring a diverse range of expertise and experience[66]. - The company has maintained compliance with listing rules by appointing at least three independent non-executive directors, representing at least one-third of the board[68]. - The company believes that the current structure of having the same individual serve as both Chairman and CEO is beneficial for effective strategy implementation[67]. - The board is responsible for significant matters including policy, strategy, budget, internal controls, and risk management[75]. - The company has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee, with a majority of independent non-executive directors[78]. - The Audit Committee's primary responsibilities include reviewing financial information, internal control procedures, and risk management systems[79]. - The company provides formal and comprehensive onboarding for new directors to ensure they understand their responsibilities under listing rules and regulations[76]. - Continuous professional development is facilitated for directors, including participation in external seminars and training courses[77]. Market Challenges and Strategies - The company continues to face multiple challenges, including trade tensions and the impact of COVID-19 on global markets[16]. - The company aims to expand its market network to counter competitive pressures and actively seek new business opportunities[16]. - The company reported a significant impact on its operations due to the ongoing COVID-19 pandemic, which has affected supply chains and consumer demand[111]. - The company is subject to risks from trade restrictions and tariffs between the US and China, which could increase product costs and affect consumer confidence[111]. Share Options and Equity - The company has a total of 132,670,173 share options available for issuance under the updated plan, representing approximately 10% of the issued share capital as of the report date[140]. - As of June 30, 2020, the company recognized approximately $440,000 in share-based payment expenses, a decrease from $1,905,000 as of June 30, 2019[145]. - The exercise price for certain share options is set at HKD 0.46 per share, with a total of 10,860,000 options granted to the chairman and CEO, Mr. Zhang, and 13,260,000 options granted to executive director, Mr. Chen[142]. - The share options plan was adopted on November 22, 2013, and was amended on November 15, 2018, to comply with listing rules[138]. - The company has not granted, exercised, canceled, or allowed any share options to lapse during the year, aside from those disclosed[145]. Auditor and Compliance - The independent auditor, Zhonghui Anda CPA Limited, was appointed on June 21, 2019, and will be proposed for reappointment at the upcoming annual general meeting[158]. - The audit committee reviewed the accounting principles and practices adopted by the group and discussed audit, internal control, and financial reporting matters[157]. - The company has established an insider information policy to ensure timely and equal disclosure of insider information to the public[92]. - The company ensures that all resolutions presented at the shareholders' meeting are voted on according to listing rules, with results published on the company's and the stock exchange's websites[94]. - The company secretary has complied with the professional training requirements as per the listing rules this year[88].

Financial Performance - Revenue for the six months ended December 31, 2019, was $77,389,000, representing a 23.2% increase from $62,790,000 in the same period of 2018[7]. - Gross loss for the period was $5,275,000, compared to a gross loss of $4,694,000 in the previous year, indicating a decline in gross margin[7]. - The company reported a loss before tax of $14,215,000, slightly improved from a loss of $15,721,000 in the prior year[7]. - Total comprehensive loss for the period was $14,547,000, compared to $16,007,000 in the same period of 2018, showing a reduction in overall losses[9]. - Basic and diluted loss per share was $0.92, an improvement from $1.06 in the previous year[9]. - The company reported segment losses of $12,231,000 for the six months ended December 31, 2019, compared to segment losses of $13,535,000 in the same period of 2018[23][25]. - The net loss for the period was approximately $14.41 million, with gross loss around $5.28 million, compared to a gross loss of approximately $4.69 million in the previous year[38]. Assets and Liabilities - Non-current assets decreased to $22,939,000 from $23,118,000 as of June 30, 2019[11]. - Current assets decreased to $65,153,000 from $69,787,000, primarily due to a reduction in inventory[11]. - Current liabilities increased to $47,993,000 from $38,602,000, indicating a rise in trade payables[11]. - Total equity decreased to $38,026,000 from $52,133,000, reflecting a significant decline in reserves[12]. - Trade receivables at the end of the reporting period amounted to $31.03 million, significantly up from $18.48 million at the end of the previous period[32]. - The group's current assets net value as of December 31, 2019, was approximately $17,160,000, down from $31,185,000 on June 30, 2019[49]. - The group reported a current ratio of approximately 1.4 as of December 31, 2019, compared to 1.8 on June 30, 2019[49]. Cash Flow - The company reported a net cash outflow from operating activities of $3,576,000 for the six months ended December 31, 2019, compared to a net outflow of $893,000 for the same period in 2018[16]. - The company’s cash and cash equivalents decreased by $1,375,000 during the six months ended December 31, 2019, compared to a decrease of $3,074,000 in the same period of 2018[16]. - The company’s total cash and cash equivalents as of December 31, 2019, were $5,423,000, down from $5,584,000 as of December 31, 2018[16]. - The company’s financing activities generated a net cash inflow of $2,278,000 for the six months ended December 31, 2019, compared to a net cash outflow of $2,151,000 in the same period of 2018[16]. Revenue by Division - The brand products division generated revenue of approximately $42,408,000, an increase of about 58% from $26,867,000 in the same period last year[55]. - The lending services division's revenue increased by approximately 15% to $553,000 from $482,000 in the previous year[59]. - The computer hardware and software development division's revenue decreased by approximately 16% to $1,770,000 from $2,103,000 in the same period last year[63]. - The trade business division's revenue increased by approximately 50% to $6,345,000 from $4,235,000 in the previous year[62]. Shareholder Information - As of December 31, 2019, the major shareholder, Mingzhi Global Holdings Limited, holds 714,163,680 shares, representing approximately 53.83% of the issued share capital[70]. - The company’s executive director, Zhang Sanhuo, has a beneficial ownership of 16,860,000 shares, accounting for about 1.27% of the issued share capital[74]. - The company’s executive director, Chen Zhuohau, holds 19,260,000 shares, which is approximately 1.45% of the issued share capital[74]. - PINE Technology (BVI) Limited, under the beneficial ownership of Simply Perfect Group Limited, holds 1,650 shares, representing 15% of the issued share capital[71]. - All shares held by Mingzhi Global Holdings Limited were pledged as collateral for financing as of December 31, 2019[78]. Stock Options and Corporate Governance - The company has stock options allowing Zhang Sanhuo to purchase 6,000,000 shares at HKD 0.83 and 10,860,000 shares at HKD 0.46[76]. - Chen Zhuohau has stock options to purchase 6,000,000 shares at HKD 0.83 and 13,260,000 shares at HKD 0.46[76]. - The company has granted a total of 80,140,000 stock options at an exercise price of HKD 0.46 per share under the 2018 stock option plan[80]. - The stock option plan is set to expire on November 21, 2023, unless canceled or amended[79]. - The company has complied with all provisions of the corporate governance code, except for specific clauses regarding the separation of roles between the chairman and the CEO[87]. - The board believes that the current structure of having the same individual serve as both chairman and CEO is beneficial for effective strategy implementation[87]. Operational Focus and Future Plans - The company is focusing on new product development and market expansion strategies to improve future performance[6]. - The company plans to focus on reducing operational costs and inventory levels while maintaining flexibility in response to the ongoing COVID-19 pandemic[44]. - The performance of the trading business in joint ventures in China has declined due to increased operating costs and market competition, but the overall impact on the company's financial position is considered minimal[41]. - The company will continue to review the composition of its loan portfolio and the interest rates charged to maximize revenue and mitigate credit risk[40]. - The lending business is expected to remain a stable source of income, with management adopting a cautious approach to maintain healthy cash flow[46].

Financial Performance - The company's revenue for the fiscal year ended June 30, 2019, was $167,070,000, a decrease of approximately 41% compared to the previous year[16]. - The gross loss for the year was approximately $16,444,000, a decline of about 280% from a gross profit of $9,111,000 in the previous year[27]. - The net loss attributable to shareholders was approximately $43,499,000, compared to a loss of $9,289,000 in the prior year, representing an increase in loss of $34,210,000[27]. - Basic loss per share was $2.95, compared to $0.78 in the previous year, indicating a significant increase in loss per share[27]. - The group's brand product segment revenue was approximately $44,509,000, a decrease of about 79% from $211,869,000 in the previous year, with a segment loss of approximately $34,392,000[35]. - Other brand products generated revenue of approximately $54,592,000, down about 22% from $70,179,000, with a segment loss of approximately $221,000[37]. - The lending services segment reported revenue of approximately $1,008,000, an increase of about 439% from $187,000 in the previous year, with a profit of approximately $666,000, up about 340% from $19,000[38]. - The trading business segment, which started in the second half of 2018, generated revenue of approximately $62,631,000 with a loss of approximately $86,000[42]. Financial Position - The company reduced its inventory from $100,500,000 to $31,800,000 during the year, and bank loans decreased from $13,300,000 to $6,900,000[17]. - The net current assets decreased to $31,185,000 from $61,390,000, indicating a decline in financial health[27]. - The current ratio slightly decreased from 1.9 to 1.8, reflecting a minor reduction in liquidity[27]. - As of June 30, 2019, the group's current assets net value and equity attributable to owners were approximately $31,185,000 and $46,000,000, respectively, compared to $61,390,000 and $61,575,000 in 2018[28]. - The group's total bank loans as of June 30, 2019, were approximately $6,892,000, a decrease from $13,334,000 in 2018[29]. - The capital debt ratio as of June 30, 2019, was approximately 44%, down from 53% in 2018[33]. - The group maintained a cash balance of approximately $6,845,000 as of June 30, 2019, compared to $8,681,000 in 2018[29]. - As of June 30, 2019, around HKD 5,770,000 was utilized for shareholder loans to Guangzhou Taifu Xintong Technology Co., Ltd. for software and system development[54]. Corporate Governance - The management team includes experienced professionals with over 20 years in corporate management across various industries[57][58]. - The board comprises independent non-executive directors with extensive backgrounds in finance and management, enhancing corporate governance[61][63]. - The company has adhered to the corporate governance code as per the listing rules, ensuring high standards of corporate governance throughout the fiscal year ending June 30, 2019[70]. - The board consists of three executive directors and three independent non-executive directors, maintaining compliance with the requirement that independent directors constitute at least one-third of the board[78]. - The company has implemented a specific guideline for employees regarding securities trading, ensuring compliance with the standard code[71]. - The chairman and CEO roles are held by the same individual since January 3, 2018, which deviates from the corporate governance code but is believed to enhance leadership effectiveness[77]. - The company has confirmed that all independent non-executive directors have submitted annual independence confirmation letters, ensuring compliance with independence guidelines[78]. - The company has established a nomination committee to consider the appointment of new directors based on professional knowledge, experience, and integrity[80]. - The board believes that the independent non-executive director, who has served for over nine years, continues to exercise independent judgment and is not affected by his tenure[78]. - The company plans to rotate one-third of the board members at the annual general meeting, ensuring regular re-election and compliance with company bylaws[80]. - The company has maintained compliance with the listing rules regarding the appointment of sufficient independent non-executive directors with appropriate professional qualifications[78]. - The board of directors is responsible for leading and controlling the company, overseeing business strategies and performance[84]. - The audit committee held two meetings during the year to review the annual financial performance and compliance procedures[89]. - The remuneration committee reviewed the compensation policies and structures for executive directors and senior management, holding two meetings in the year[90][91]. - The nomination committee conducted one meeting to assess the board's composition and the independence of non-executive directors[92]. - The company secretary provided governance advice to the board and complied with professional training requirements as per listing rules[102]. - The board adopted a diversity policy to ensure a range of skills, experiences, and backgrounds among its members[84]. - The audit committee facilitated confidential reporting mechanisms for employees regarding financial reporting and internal controls[89]. - The board held regular meetings with a minimum notice of 14 days for scheduled meetings, ensuring adequate time for review[96]. - All board members received comprehensive onboarding to understand the company's operations and regulatory responsibilities[85]. - The company maintains a commitment to ongoing professional development for directors through training and updates on regulatory changes[86]. Risk Management - The board is responsible for the effectiveness of the group's risk management and internal control systems, which are deemed effective and adequate[104]. - The company has established a comprehensive risk management process that includes risk identification, assessment, valuation, and handling[104]. - The major risks affecting the group's performance include uncertainties in the global economic environment, particularly due to the ongoing US-China trade war and unstable supply chains[122]. - The company is committed to ensuring that insider information is disclosed to the public in a timely and equal manner[104]. Shareholder Information - The company will present independent resolutions at the shareholders' meeting to safeguard shareholder rights[107]. - The board has approved a dividend policy effective from July 5, 2019, which will be reviewed periodically and may be amended as necessary[123]. - No final dividend is recommended for the current fiscal year, consistent with the previous year where no dividend was declared[125]. - The board retains the right to propose dividends based on various factors, including economic conditions and business cycles[124]. - The company has not repurchased any of its listed shares during the fiscal year[138]. - Zhang Sanhuo holds 714,163,680 shares, representing approximately 53.83% of the issued share capital of Songjing Technology Holdings Limited[144]. - Zhao Hengtai owns 1,650 shares in Pine Technology (BVI) Limited, accounting for 15% of the issued share capital[146]. - Zhang Sanhuo has beneficial ownership of 16,860,000 shares, which is about 1.27% of the issued share capital[149]. - Chen Zhuohao has beneficial ownership of 19,260,000 shares, representing approximately 1.45% of the issued share capital[149]. Stock Options and Shareholdings - The company has a stock option plan that allows directors and eligible employees to purchase shares at an exercise price of HKD 0.46 per share[152]. - A total of 80,140,000 stock options were granted at an exercise price of HKD 0.46 per share, as disclosed on December 12, 2018[153]. - The stock option plan is set to expire on November 21, 2023, unless cancelled or amended[152]. - The company’s stock options can be exercised within 10 years from the grant date, with an acceptance fee of HKD 1 per option[152]. - The shares held by Mingzhi Global Holdings Limited are used as collateral for financing[147]. - The company has no other significant shareholdings or interests disclosed by directors or key executives as of June 30, 2019[150]. - The total number of shares available for issuance under the share option plan is 72,658,478, representing approximately 5.48% of the company's issued share capital as of the report date[157]. - The company recognized share-based payment expenses of approximately $1,905,000 for the year, compared to $532,000 for the previous year[157]. - The company did not grant, exercise, cancel, or lapse any share options under the plan during the year, aside from what has been disclosed[157]. - There were no significant transactions, arrangements, or contracts involving directors or related entities during the year[159]. - The company has no other unexercised convertible securities, share options, warrants, or similar rights as of June 30, 2019[167]. - The company has not participated in any arrangements allowing directors to benefit from the acquisition of shares or bonds during the year[158]. - The company confirmed that there are no competitive interests held by directors or their associates that require disclosure under the listing rules[160]. Inventory and Receivables - The group reported a total inventory balance of $31,752,000 as of June 30, 2019, with an impairment loss of approximately $6,220,000 for the fiscal year[184]. - Trade receivables and other receivables amounted to approximately $19,824,000 as of June 30, 2019, which is a significant item in the consolidated financial statements[186]. - Goodwill and intangible assets were valued at approximately $7,985,000 and $13,328,000 respectively as of June 30, 2019, with a goodwill impairment loss of about $3,845,000 for the fiscal year[191]. Audit and Compliance - The board is responsible for preparing true and fair consolidated financial statements according to Hong Kong Financial Reporting Standards and the Companies Ordinance[195]. - The auditors aim to obtain reasonable assurance that the consolidated financial statements are free from material misstatement due to fraud or error[196]. - The auditors report their opinion solely to the shareholders, with no responsibility to any other parties[196].