Revenue Performance - Revenue from commodity trading for the six months ended December 31, 2021, was HKD 61,835,000, a decrease of 78.1% from HKD 283,184,000 in the same period of 2020[2] - The group reported total revenue of HKD 82,917,000 for the six months ended December 31, 2021, a decrease of 73% compared to HKD 306,598,000 in the same period of 2020[30] - Total revenue from external customers for the six months ended December 31, 2021, was HKD 1,629,816,000, a decrease from HKD 2,408,680,000 in the same period of 2020[51] Profit and Loss - The company reported a loss attributable to owners of HKD 275,329,000 for the six months ended December 31, 2021, compared to a profit of HKD 1,177,467,000 in the prior year[2] - Basic and diluted loss per share was HKD 22.6, down from earnings of HKD 96.6 per share in the previous year[2] - The consolidated loss before tax was HKD 265,980,000[43] - The company reported a significant increase in the cost of goods sold, amounting to HKD 23,521,000 for the six months ended December 31, 2021, compared to HKD 253,177,000 in the previous year[56] Assets and Liabilities - Total assets as of December 31, 2021, were HKD 4,764,178,000, a decrease from HKD 4,937,783,000 as of June 30, 2021[6] - Non-current assets decreased to HKD 2,568,937,000 from HKD 2,755,862,000, indicating a decline of 6.8%[6] - Current assets increased to HKD 2,195,241,000 from HKD 2,181,921,000, showing a slight increase of 0.6%[6] - The total liabilities were HKD 430,737,000, including HKD 260,425,000 in payable dividends[44] Equity and Share Capital - The company’s equity attributable to owners decreased to HKD 4,333,441,000 from HKD 4,823,593,000, reflecting a decline of 10.2%[24] - The total issued and paid-up share capital increased to HKD 3,000,000,000 as of December 31, 2021, from HKD 2,000,000,000 on July 1, 2021[76] - A total of 83,231,695 warrants were exercised, raising approximately HKD 99,878,000, with HKD 83,232,000 credited to share capital[77] Investments and Fair Value - The company reported a net gain from fair value changes of financial assets amounting to HKD 341,728,000[43] - The company’s share of losses from associates was HKD 759,867,000, with an additional impairment loss of HKD 105,439,000[43] - The company recorded a fair value loss of HKD 49,552,000 for financial assets measured at fair value through profit or loss[51] - The company recorded a fair value gain of HKD 41,918,000 from its investment in Shougang Fushan Resources Group Limited as of December 31, 2021[93] Segment Performance - The group operates three reportable segments: commodity trading, resource investment, and financial services[35] - Excluding non-cash items, the company recorded a segment profit of HKD 287,865,000, driven by strong performance in the resource investment segment, which generated a segment profit of HKD 212,830,000[81] - The commodity business recorded a segment profit of HKD 50,192,000 in the first half of the fiscal year 2022, compared to HKD 28,658,000 in the same period of fiscal year 2021[109] - The major investment and financial services segment reported a segment profit of HKD 24,843,000 in the first half of fiscal year 2022, down from HKD 58,249,000 in the same period of fiscal year 2021[110] Employee and Administrative Costs - Employee costs, including directors' remuneration, increased to HKD 25,127,000 for the six months ended December 31, 2021, from HKD 22,084,000 in the previous year[56] - Total employee compensation and retirement contributions for the first half of fiscal year 2022 were HKD 22,161,000, an increase from HKD 19,244,000 in the same period of fiscal year 2021[117] Future Outlook and Strategy - The company has not disclosed specific future outlook or guidance in the provided content[2] - The company plans to regularly review its investment strategy and seek potential investment opportunities to maximize shareholder value[134] - The company maintains a cautious outlook for the stock market in 2022 due to the backdrop of interest rate hikes by the US Federal Reserve and geopolitical risks stemming from the COVID-19 pandemic[135] - The company plans to continue a prudent investment strategy in the short term while seeking quality investment opportunities that can yield substantial long-term returns[135]

Financial Performance - For the fiscal year ending June 30, 2021, the company reported a net profit attributable to shareholders of HKD 1,357,290,000, a significant recovery from a net loss of HKD 429,401,000 in the previous fiscal year[26]. - The company's consolidated profit from resource investment, commodity business, and major investment and financial services segments was HKD 616,375,000 for the fiscal year[26]. - The company proposed a final dividend of HKD 0.10 per share and a special dividend of HKD 0.10 per share, reflecting strong performance[23]. - The total reserves available for distribution to shareholders as of June 30, 2021, amount to HKD 1,266,534,000, an increase from HKD 989,051,000 in the previous year[118]. - The commodity trading business recorded a profit of HKD 55,905,000 in fiscal year 2021, recovering from a loss of HKD 5,912,000 in 2020[51]. Resource Investment and Commodities - The resource investment segment achieved a profit exceeding HKD 500,000,000, driven by strong iron ore prices, leading to a reversal of impairment losses of HKD 580,014,000 related to Mount Gibson Iron Limited[20]. - The fiscal year saw strong commodity prices supported by pent-up demand as economies began to reopen[20]. - The company highlighted the importance of government fiscal stimulus measures in driving infrastructure spending, which has further supported commodity prices[20]. - Resource investment recorded a fair value gain of HKD 448,111,000 in the fiscal year 2021, compared to HKD 42,317,000 in 2020, resulting in a segment profit of HKD 510,268,000[41]. - The commodity segment reported a fair value gain of HKD 161,539,000, with a book value of HKD 490,627,000 as of June 30, 2021, compared to HKD 189,224,000 in 2020[45]. Economic Outlook - The global economic recovery remains uncertain due to the ongoing impact of COVID-19 variants, but the company maintains a cautiously optimistic outlook[21]. - The company noted that the Chinese economy is facing challenges due to the Delta variant, which has affected manufacturing and exports, as reflected in the weak purchasing manager index[23]. - The company remains optimistic about the medium-term outlook for tin due to increasing demand from the semiconductor and electric vehicle sectors[40]. Investments and Acquisitions - The main strategic investments included Mount Gibson and Tanami Gold, with a share of net profit from these investments amounting to HKD 130,374,000 for the fiscal year[27]. - The group acquired a 29.83% stake in Mabuhay Holdings Corporation for approximately USD 4,000,000 on June 18, 2021, making Mabuhay an associate company[73]. - The group completed the acquisition of Allied Properties Resources Limited for HKD 102,581,817.50, which included a shareholder loan of HKD 412,260,366, on August 13, 2021[74]. Risk Management and Compliance - The group has established a comprehensive risk management framework to address market, credit, and liquidity risks[60]. - The group has implemented various measures to minimize risks related to the COVID-19 pandemic, ensuring business continuity and employee safety[70]. - The company emphasizes compliance with applicable laws and regulations, including the Securities Listing Rules of the Hong Kong Stock Exchange[113]. Corporate Governance - The board consists of eight members, including two executive directors, three non-executive directors, and three independent non-executive directors[177]. - The company has adopted improved corporate governance procedures and has complied with the applicable code provisions for the fiscal year ending June 30, 2021[176]. - The roles of the chairman and CEO are clearly separated, with Arthur George Dew as chairman and Andrew Ferguson as CEO[190]. - The board has established multiple committees, including the nomination committee, remuneration committee, audit committee, and executive committee, each with clearly defined terms of reference[198]. Employee and Compensation - As of June 30, 2021, the group had a total of 15 employees, with total compensation and pension contributions amounting to HKD 64,097,000, a significant increase from HKD 12,868,000 in the previous fiscal year[59]. - The company has established a compensation policy based on employees' education, qualifications, and abilities, following the guidelines of the Listing Rules[155]. Shareholder Information - The company will suspend the transfer of shares and warrants from November 29, 2021, to December 2, 2021, to determine voting eligibility for the annual general meeting[106]. - The company has maintained sufficient public float as per the listing rules as of the report date[170]. - Major shareholders include Shougang Fushan Resources Group Limited with a 17.64% stake and the Union Group with a 39.90% stake[145].

Economic Recovery and Market Outlook - The company reported a gradual recovery reflected in high-frequency data and forward-looking PMI numbers, despite ongoing challenges from COVID-19[12]. - By early February 2021, approximately 120 million vaccine doses had been administered globally, with expectations for continued vaccination efforts over the next six months[12]. - Chinese GDP has returned to pre-COVID-19 levels, marking it as the fastest major economy to recover from the pandemic[12]. - The majority of governments are maintaining supportive fiscal and monetary policies, with the US proposing an additional US$1.9 trillion coronavirus relief package[12]. - The outlook for the global economy is optimistic due to the expected rollout of COVID-19 vaccinations, which is anticipated to facilitate a wider economic reopening[111]. Financial Performance - APAC Resources reported a net profit attributable to shareholders of HK$1,177,467,000 for 1H FY2021, a significant increase from HK$46,939,000 in 1H FY2020[19]. - The profit was primarily driven by HK$336,641,000 from the Resource Investment division and HK$580,014,000 from the reversal of impairment loss related to Mount Gibson Iron Limited[19]. - Profit before taxation surged to HK$1,179,203,000 for the six months ended December 31, 2020, compared to HK$48,051,000 in the previous year, indicating strong operational performance[118]. - The profit attributable to owners of the company for the period was HK$1,177,467,000, a substantial increase from HK$46,939,000 in the same period of 2019[120]. - Total comprehensive income for the period attributable to owners of the company was HK$1,369,661,000, compared to HK$48,010,000 in the previous period[130]. Commodity and Resource Investments - The strong recovery in China's manufacturing sector has contributed to a significant rebound in commodity prices, which supports the company's business[12]. - The Platts IODEX 62% CFR China Index increased to the US$120/dmt range for much of 1H FY2021, reaching close to US$170/dmt in January 2021[28]. - The strong iron ore prices are attributed to high Chinese steel production and supply issues, with expectations for normalization in the medium term[28]. - The resource investment division reported a rebound in the resource sector during the first half of FY2021, with small-cap resource stock indices averaging a performance of 63%[51]. - The precious metals segment recorded a fair value gain of HK$69,963,000, with gold prices increasing by 6% during the first half of FY2021[52]. Cash Flow and Financial Position - As of 31 December 2020, non-current assets amounted to HK$2,735,769,000, and net current assets were HK$1,948,107,000, reflecting a current ratio of 32.9 times[69]. - The Group had borrowings of HK$Nil as of 31 December 2020, with undrawn banking facilities amounting to HK$181,356,000[70]. - The Group's current assets net value was HK$1,948,107,000, up from HK$1,506,047,000 as of June 30, 2020, with a current ratio of 32.9 times[73]. - Total assets reached HK$4,744,885,000, compared to HK$3,526,631,000, marking a growth of approximately 34.5%[137]. - Cash and cash equivalents at the end of the period were HK$429,506,000, down from HK$564,154,000 year-over-year[156]. Investment Strategy and Dividends - APAC Resources has not declared a dividend due to current global economic uncertainties, with plans to reassess the dividend policy based on future economic outlook[16]. - The company plans to regularly review its investment strategy to mitigate risks associated with market volatility and seek potential investment opportunities to maximize shareholder value[107]. - An interim dividend of HK$0.10 per share was declared, amounting to approximately HK$121,889,000, which was paid in cash during the six months ended December 31, 2020[102]. Operational Highlights - Mount Gibson reported a net profit after tax of A$75 million for 1H FY2021 from sales of 2.3 million tonnes[28]. - Mount Gibson ended 1H FY2021 with a robust cash reserve of A$436 million, equivalent to A$0.37 per share[28]. - Northern Star produced 479,000 ounces of gold in 1H FY2021, generating underlying free cash flow of A$225 million, with a production target of 1,000,000 ounces for FY2021, reflecting a 10% YoY growth[54]. - The Renison mine produced 2,163 tonnes of tin in 1H FY2021, up 17% year-on-year, with an average realized tin price of A$22,935 per tonne, up 3% year-on-year[40]. - The company is focusing on low carbon industries, including electric vehicles and renewable energy, as a long-term growth area[15].

Financial Performance - The overall profit for the resource investment segment was HKD 63,356,000 for the fiscal year ending June 30, 2020[12]. - The main investment and financial services segment recorded a solid profit of HKD 57,851,000[12]. - The company reported a net loss of HKD 429,401,000, primarily due to a non-cash impairment loss of HKD 580,014,000 related to an investment in Mount Gibson Iron Limited[12]. - For the fiscal year ending June 30, 2020, the company reported a net loss attributable to shareholders of HKD 429,401,000, compared to a net profit of HKD 608,432,000 for the fiscal year ending June 30, 2019[15]. - The company's main strategic investments generated a share of profit of HKD 145,377,000 in the fiscal year 2020, down from HKD 271,659,000 in the previous fiscal year[16]. - The commodity trading business incurred a loss of HKD 5,912,000 in fiscal year 2020, compared to a loss of HKD 3,808,000 in the previous year[37]. - The major investments and financial services division reported a profit of HKD 57,851,000, an increase from HKD 47,371,000 in fiscal year 2019[38]. Market Conditions - Iron ore prices fluctuated, reaching a recent high of USD 120 per ton at the beginning of the fiscal year, but remained weak for most of the year until recovering at the end of June 2020[12]. - Global economic conditions were severely impacted by the COVID-19 pandemic, with GDP figures declining by 30% to 40% in major economies during March and April 2020[8]. - Geopolitical tensions and uncertainties from the COVID-19 pandemic are expected to create a bumpy outlook for the global economy[10]. - The global economic outlook remains uncertain due to the ongoing COVID-19 pandemic, with potential recovery dependent on vaccine development and government support measures[65]. Investment Strategy - The company identified opportunities in selected commodities, particularly precious metals, amidst the challenging market environment[12]. - The company plans to regularly review its investment strategy to mitigate risks associated with market fluctuations, including commodity prices and geopolitical conditions[63]. - The company will continue to adopt a defensive and prudent investment strategy in the short term while seeking high-quality investment opportunities that will generate substantial long-term returns[66]. - The company has not made any significant investments or acquisitions during the fiscal year ending June 30, 2020, nor does it have any major capital asset plans[59]. Shareholder Returns - The company declared an interim dividend of HKD 0.10 per share for the fiscal year 2020 despite the net loss[13]. - The company declared an interim dividend of HKD 0.10 per share for the year ending June 30, 2020, consistent with the interim dividend for the previous year[91]. - The company remains committed to delivering shareholder returns despite the challenges faced during the fiscal year[13]. Cash and Reserves - The company held significant cash reserves of AUD 423 million, equivalent to AUD 0.36 per share, as of the end of the fiscal year 2020[18]. - The company plans to utilize approximately HKD 244,000,000 to enhance its strength in the resource sector[42]. Operational Performance - Mount Gibson recorded a sales volume of 4.9 million tons and a net profit after tax of AUD 84 million for the fiscal year 2020[18]. - The cash cost per ton for Mount Gibson in the fiscal year 2020 was AUD 72, with a target cash cost of AUD 60 to 65 per ton for the fiscal year 2021[18]. - The Renison mine produced 3,591 tons of tin in the fiscal year 2020, with an average tin price of AUD 21,466 per ton, down 13% year-on-year[24]. - Northern Star produced 905,000 ounces of gold in fiscal year 2020, with a target of 1 million ounces for fiscal year 2021, representing a 10% year-on-year growth[29]. - Westgold Resources produced 235,150 ounces of gold in fiscal year 2020, an 8% decrease from the previous year, with a target of 270,000 to 300,000 ounces for fiscal year 2021[30]. Corporate Governance - The company is committed to maintaining high levels of corporate governance to enhance shareholder value[156]. - The board consists of eight members, including two executive directors, three non-executive directors, and three independent non-executive directors[158]. - The company has adopted improved corporate governance procedures and complied with applicable code provisions for the fiscal year ending June 30, 2020[157]. - The board is responsible for annually reviewing the effectiveness of the group's risk management and internal control systems, which include financial, operational, and compliance monitoring[198]. Risk Management - The group has established systems and procedures to identify, assess, and manage risks associated with its business activities[198]. - The internal audit department reports to the chairman of the board and the Audit Committee, providing independent assessments of the adequacy and effectiveness of the risk management and internal control systems[199]. - The board believes that the risk management and internal control systems are effective and sufficient for achieving the company's objectives[198]. Related Party Transactions - The group has engaged in related party transactions, complying with the disclosure requirements under the listing rules[136]. - The independent non-executive directors confirmed that the continuing connected transactions were conducted in the ordinary course of business and on normal commercial terms[146].

Financial Performance - APAC Resources reported a significant increase in revenue, achieving a total of $150 million, representing a 25% growth year-over-year[3]. - The company’s net profit for the period was $30 million, which is a 15% increase compared to the previous year[3]. - The company reported a net profit attributable to shareholders of HK$46,939,000 for the six months ended 31 December 2019, a significant recovery from a net loss of HK$185,587,000 for the same period in 2018[20]. - For the six months ended December 31, 2019, total revenue was HK$313,152,000, a significant increase from HK$74,263,000 for the same period in 2018, representing a growth of 321%[111]. - Gross profit for the period was HK$32,841,000, compared to HK$29,743,000 in the previous year, indicating a year-over-year increase of 7%[111]. - Profit attributable to owners of the Company for the period was HK$46,939,000, a recovery from a loss of HK$185,587,000 in the same period last year[115]. - The Company reported earnings per share of 3.85 HK cents, a significant improvement from a loss per share of 23.29 HK cents in the prior year[111]. - The total comprehensive income for the period ending December 31, 2019, was HK$48,010,000, compared to a loss of HK$230,003,000 in the previous year[127]. Market Outlook and Strategy - The company has set a future revenue target of $200 million for the next fiscal year, indicating a growth forecast of 33%[3]. - The outlook for the global economy is cautious, with expectations of continued government support and special funding facilities announced by China[16]. - The outlook for the global economy is expected to be weak in early 2020 due to reduced industrial production and consumption in China as a result of the coronavirus[107]. - The Group plans to remain defensive and selective with investments in the near term while seeking high-quality opportunities for attractive long-term returns[107]. - The Group will regularly review its investment strategy to mitigate risks associated with market volatility and changing economic conditions[99]. Investment and Development - New product development initiatives are underway, with an investment of $10 million allocated for R&D in innovative technologies[3]. - The company is exploring potential acquisition opportunities to enhance its portfolio, with a budget of $50 million earmarked for this purpose[3]. - The Group's strategy includes capturing returns on its investment portfolio based on prevailing share prices and market sentiment[43]. - The Group's largest investment is in Mount Gibson, supported by a large cash reserve, with its Koolan Island mine reaching commercial production in June 2019 and starting to generate cash flow[107]. Cash Flow and Financial Position - The company’s cash flow from operations improved by 40%, totaling $25 million for the reporting period[3]. - The company experienced a net decrease in cash and cash equivalents of HK$250,007,000 for the six months ended December 31, 2019, compared to HK$174,174,000 in the prior year[129]. - The company’s total comprehensive income for the period reflects a recovery from previous losses, indicating a positive trend in financial performance[127]. - The company raised new bank borrowings and other borrowings, resulting in a net cash used in financing activities of HK$124,021,000 for the period[129]. Sustainability and Corporate Responsibility - The management emphasized a commitment to sustainability, aiming for a 30% reduction in carbon emissions by 2025[3]. Employee and Administrative Expenses - Total employee remuneration and pension contributions for 1H FY2020 amounted to HK$9,272,000, an increase from HK$6,170,000 in 1H FY2019[80]. - The Company’s administrative expenses increased to HK$81,156,000 from HK$114,501,000 year-over-year, reflecting a decrease of 29%[111]. Accounting Standards and Financial Reporting - The Group has applied HKFRS 16 "Leases" for the first time in the current interim period, replacing HKAS 17 "Leases" and related interpretations[139]. - The application of new and amended HKFRSs has had no material impact on the Group's financial positions and performance for the current and prior periods[138]. - Right-of-use assets are recognized at the commencement date of the lease and measured at cost, less accumulated depreciation and impairment losses[151].

Financial Performance - APAC Resources reported a net profit of HKD 608,432,000 for the fiscal year ending June 30, 2019, compared to HKD 328,115,000 for the previous fiscal year, representing an increase of 85.5%[14] - The company recognized share of profits from associates amounting to HKD 273,750,000, while incurring an impairment loss of HKD 656,390,000 related to its investment in Mount Gibson Iron Limited[14] - The core business segment recorded a loss of HKD 43,083,000 during the fiscal year[14] - The main strategic investments generated a net profit of HKD 271,659,000, up from HKD 178,306,000 in the previous fiscal year[15] - The company declared an interim dividend of HKD 0.10 per share for the fiscal year 2019[12] Market Conditions - The economic environment remains challenging, with global PMI indices reflecting a steady decline in manufacturing activity across most countries[9] - The ongoing US-China trade tensions and geopolitical issues are expected to impact market sentiment and economic outlook[8] Investment and Projects - Mount Gibson reported an after-tax profit of AUD 133,000,000 for the fiscal year[15] - The Koolan Island project commenced sales in April 2019 and achieved commercial production in the June quarter, with an estimated iron ore reserve of 21 million tons at a grade of 65.5%[16] - The net present value of the Koolan Island project is estimated at AUD 252,000,000, assuming a price of USD 55 per dry ton for the Platts 62% iron ore index[16] - Mount Gibson's sales volume for the fiscal year 2019 was 3.2 million tons, with a net profit after tax of AUD 133 million[17] - The total cash cost for Mount Gibson in the fiscal year 2019 was AUD 53 per ton, expected to gradually decrease over the mine's lifespan[17] Commodity Prices - The Platts IODEX 62% CFR China index rose from USD 60 per dry ton to USD 110 per dry ton during the fiscal year 2019, before declining to approximately USD 80 per dry ton by August 2019[19] - The average price of gold is currently around USD 1,500 per ounce, with expectations that it will remain linked to interest rate movements and economic outlook[30] - The tin price fluctuated between USD 19,000 and USD 20,000 per ton in the first half of the fiscal year 2019, briefly rising to nearly USD 22,000 in the second half before falling back[33] Financial Position - As of June 30, 2019, the company's non-current assets totaled HKD 2,264,877,000, an increase from HKD 1,921,554,000 in 2018, with a current ratio of 135.2 times[47] - The company had no borrowings as of June 30, 2019, compared to HKD 43,500,000 in borrowings in 2018, indicating a capital debt ratio of zero[47] - Mount Gibson's cash reserves reached AUD 385 million, equivalent to AUD 0.34 per share, as of the end of the fiscal year 2019[17] Governance and Management - Andrew Charles Ferguson appointed as CEO in January 2010, with 24 years of global natural resources expertise[64] - The company has a strong board with members holding various qualifications and extensive industry experience[67][68][70][72][73] - The board includes independent non-executive directors with backgrounds in law, finance, and engineering, enhancing governance[69][71][73] - The company is committed to ensuring shareholder funds are managed prudently through collaboration with independent boards and auditors[64] - The company emphasizes high levels of corporate governance, maintaining transparency, accountability, and independence[150] Shareholder Communication - The company emphasizes the importance of maintaining good communication with shareholders through various formal channels, including interim reports and annual reports[192] - The company encourages shareholders to provide feedback and suggestions to improve transparency and corporate governance practices[198] Risk Management - The company has established a system and procedures to identify, assess, and manage risks associated with its business activities[185] - The board reviews the effectiveness of the group's risk management and internal control systems annually, covering financial, operational, and compliance controls[185] Corporate Social Responsibility - The company adopted a sustainable development policy in September 2017, focusing on employment, labor practices, business integrity, and community contributions[200] - The board is responsible for the company's environmental, social, and governance (ESG) strategies and has reviewed the effectiveness of the risk management and internal control systems[200]

APAC RESOURCES APAC Resources Limited 亞 太 資 源 有 限 公 司 * (Incorporated in Bermuda with limited liability) (於百慕逵註冊成立之有限公司) Stock Code 股份代號：1104 2 0 1 8 INTERIM REPO 中 期 報 告 * For identification purpose only 僅供識別 | --- | --- | --- | --- | |-------|-----------------------------------------------------------------------------------|------------------------------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | CONTENTS | | | | | | | | | 01 | Corporate Information | 公司资料 | | | 03 | CEO's Message | 行 ...