Financial Performance - For the six months ended June 30, 2023, the company reported a revenue of HK$0, compared to HK$0 in the same period of 2022[9] - The loss from operations for the period was HK$9,578,000, a decrease of 35% from HK$14,784,000 in the previous year[9] - The total comprehensive loss for the period was HK$8,104,000, down from HK$22,385,000 in the same period of 2022, representing a 64% improvement[9] - For the six months ended June 30, 2023, the Group incurred a total comprehensive loss of approximately HK$9,610,000[20] - The consolidated loss for the period was HK$9,610,000, compared to HK$14,871,000 for the same period in 2022, reflecting a reduction of about 35%[33] - For the six months ended June 30, 2023, the total loss of reportable segments was HK$2,120,000, a decrease from HK$3,267,000 in the same period of 2022, indicating an improvement of approximately 35%[30] - The Group reported a loss of approximately HK$9.6 million for the period, a decrease from HK$14.8 million in the same period last year[74] Assets and Liabilities - The company had current assets of HK$19,757,000 as of June 30, 2023, down from HK$28,991,000 at the end of 2022[11] - Current liabilities were reported at HK$207,535,000, slightly decreased from HK$208,089,000 at the end of 2022[11] - The net current liabilities increased to HK$187,778,000 from HK$179,098,000 at the end of 2022[11] - The company’s total equity was reported as negative HK$187,622,000, compared to negative HK$179,518,000 at the end of 2022[11] - Cash and cash equivalents at the end of the period were HK$4,220,000, down from HK$15,701,000 at the end of the previous year[15] - The Group's total equity attributable to owners decreased to HK$442,618,000 as of June 30, 2023, from HK$465,003,000 at the beginning of the year[13] - The Group's accumulated losses increased to approximately HK$4,477,588,000 as of June 30, 2023, compared to HK$4,468,008,000 at the beginning of the year[13] - As of June 30, 2023, the Group had net current liabilities of approximately HK$187,778,000, indicating significant financial uncertainty[20] Cash Flow and Financing - The net cash used in operating activities for the same period was HK$2,635,000, an improvement from HK$7,256,000 in the previous year[15] - The Group's cash flows from financing activities resulted in a net cash outflow of HK$872,000 for the six months ended June 30, 2023[15] - The Group is exploring various financing alternatives, including equity financing and bank borrowings, to support business development[88] - The company has entered into a subscription agreement for a 2-year, 5% convertible bond in the principal amount of HK$100 million, which may be converted into 1 billion new ordinary shares at an initial conversion price of HK$0.10 per share[100] - The net proceeds from the subscription are expected to amount to approximately HK$99.5 million, with 50% allocated for settling promissory notes related to the acquisition[100] Shareholding and Options - As of June 30, 2023, Sun East LLC holds 2,673,071,189 shares, representing 13.13% of the company's issued share capital[111] - As of June 30, 2023, the total number of shares issued by the company is 20,352,872,747[120] - Dr. Yeung Yung holds an interest in 2,673,071,189 shares through Sun East LLC, representing approximately 13.47% of the total shareholding[117] - The company has granted share options totaling 70,000,000 shares, which represents approximately 0.34% of the total shareholding[121] - The exercise price for share options ranges from HK$0.108 to HK$0.201[121] - The total number of options exercised during the period was zero, indicating no share options were exercised[128] Operational Highlights - The Group's principal activities include the development of high-tech electric motor vehicles and advanced battery materials[17] - The Group has been engaged in electric vehicle development for over a decade, with positive feedback received from prototypes launched since 2017[79] - The Group plans to transition into the production stage, with potential mass production expected by the end of 2024 if development plans are realized by the end of 2023[81] - The Group is actively identifying potential collaboration or acquisition opportunities to enhance electric vehicle manufacturing capabilities[84] - A proposed acquisition of Best Knob International Limited aims to expand manufacturing capabilities and sales channels for electric vehicle components[85] Challenges and Market Conditions - The Group's management highlighted challenges in the electric vehicle development due to a sluggish economic recovery and uncertain macroeconomic environment[67] - The macroeconomic environment and cautious market sentiment have negatively impacted the Group's business development and sales activities[73] Accounting and Compliance - The Group has adopted all new and revised Hong Kong Financial Reporting Standards effective from January 1, 2023, with no significant changes to accounting policies or financial statement presentation[26] - The interim results for the period are unaudited but have been reviewed by the auditor, with no disagreements noted during the audit committee's review[150]

Business Development and Strategy - The Company is optimistic about gradually catching up as the global economy recovers, aiming for new milestones in the automotive industry [15]. - The Management is committed to seeking collaborations and investment opportunities to enhance liquidity and operational performance [17]. - The Group plans to identify and secure quality manufacturers and suppliers with high-level engineering capabilities for automotive innovations [17]. - The Group aims to double its efforts in 2023 to compensate for the challenges faced in 2022 [21]. - The Group's strategic direction includes potential mergers and acquisitions to enhance its market position and operational capabilities [35]. - The Group is exploring acquisition opportunities to enhance manufacturing capabilities for electric vehicle components [81]. - The Group believes demand for high-tech, clean, and sustainable transportation will continue to grow due to urbanization and environmental regulations [65]. - The company is focused on the development of its electric vehicle business, with plans to accelerate growth through acquisitions [165][167]. Financial Performance - The Group recorded nil revenue and gross profit for the Year, compared to HK$2.6 million and HK$1.0 million for the year ended 31 December 2021 [62]. - Loss attributable to shareholders for the Year amounted to approximately HK$620.3 million, significantly higher than the loss of HK$55.3 million in 2021 [70]. - The prolonged COVID-19 pandemic has severely hindered business development, leading to stagnant revenue and financial performance [72]. - The Group incurred a loss of HK$620.3 million and an operating cash outflow of HK$17.0 million for the year, indicating material uncertainty regarding its ability to continue as a going concern [149]. - The Group recorded a loss of approximately HK$143.6 million from the sale of its joint ventures as of December 31, 2022 [182]. Governance and Management - The Company has a diverse board with members holding advanced degrees in economics, law, and finance, enhancing its governance and strategic direction [31][42]. - The Group's management team has extensive experience in finance, corporate management, and investment, with over 30 years of combined experience in the industry [30][35]. - The Company emphasizes the importance of corporate governance and compliance, as evidenced by the qualifications of its board members [39][40]. - The Audit Committee believes the company will have sufficient working capital for at least twelve months from the end of the reporting period, ensuring ongoing operations and development [165][167]. Investment and Financing - The Group is actively seeking various financing options, including equity financing, debt financing, and bank borrowings, to support its business development [88]. - A subscription agreement was entered into in September 2022, with potential subscriptions of new shares totaling HK$300 million [89]. - The major shareholder has demonstrated continued support, entering into a shareholder's loan agreement, which contributes to the company's financial stability [166][167]. - The company is exploring various financial alternatives, including equity financing and debt financing, to enhance its financial flexibility [158]. Challenges and Risks - The COVID-19 pandemic has significantly challenged the Group's research and development progress, impacting negotiations with potential partners [59]. - The Group has faced unprecedented adversities in the first half of 2022 due to stringent social distancing measures and a cautious market environment [59]. - The Group's capital debt ratio was approximately 116.4% as of December 31, 2022, compared to 45.1% a year earlier [133]. - The Group has recognized full impairment on the carrying amounts of the Meilai Investment and Compensation Payable for the year ended December 31, 2022, due to the Guarantors' inability to settle [195]. Operational Updates - The Group's flexible battery pack design allows for unique vehicle models in its product portfolio [67]. - The Group is committed to the development of electric vehicles and has been engaged in this sector for over a decade, optimizing prototypes to enhance competitiveness [75]. - The Group plans to transition into the production stage, with potential mass production expected by the end of 2024 if financing opportunities materialize [80]. - The company signed a purchase agreement on August 28, 2022, to acquire Best Knob International Limited, which specializes in automotive parts manufacturing, including transmissions and systems [84].

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佈的內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公佈全部或任何部 分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 HYBRID KINETIC GROUP LIMITED 正 道 集 團 有 限 公司 （於百慕達註冊成立之有限公司） 1188 （股份代號： ） 二零二二年全年業績公佈 正道集團有限公司（「本公司」）董事會（「董事會」或「董事」）謹此宣佈，本公司及其附 屬公司（「本集團」）截至二零二二年十二月三十一日止年度（「本年度」）之經審核綜合 財務業績如下： ...

Financial Performance - For the six months ended June 30, 2022, the company reported a revenue of HK$0, compared to HK$1,070,000 in the same period of 2021, indicating a significant decline[9]. - The gross profit for the period was HK$94,000, down from HK$323,000 in the previous year, reflecting a decrease of approximately 71.0%[9]. - The loss from operations was HK$14,784,000, an improvement from a loss of HK$20,941,000 in the prior year, showing a reduction of about 29.0%[9]. - The loss before tax was HK$14,871,000, compared to HK$21,136,000 in the same period last year, indicating a decrease of approximately 29.9%[9]. - The total comprehensive loss for the period was HK$7,514,000, compared to HK$4,551,000 in the previous year, representing an increase of about 65.0%[9]. - The loss attributable to owners of the company was HK$22,385,000, a slight improvement from HK$25,687,000 in the same period of 2021, reflecting a decrease of approximately 12.0%[9]. - Basic and diluted loss per share was HK$0.07, compared to HK$0.10 in the previous year, indicating a reduction of 30.0%[9]. - The company reported a total comprehensive loss of HK$22,330,000 for the six months ended June 30, 2022, compared to a loss of HK$25,685,000 for the same period in 2021, reflecting an improvement of about 13.8%[13]. - The Group reported a loss for the period of approximately HK$14,854,000, compared to a loss of approximately HK$21,120,000 in the same period of 2021, representing a decrease in loss of about 29%[50]. Cash Flow and Assets - The company reported a net cash used in operating activities of HK$7,256,000 for the six months ended June 30, 2022, compared to HK$10,156,000 for the same period in 2021, showing an improvement of approximately 28.5%[16]. - Cash and cash equivalents at the end of the period were HK$15,701,000, a decrease from HK$17,059,000 at the end of June 30, 2021, reflecting a decline of about 8.0%[16]. - As of June 30, 2022, the company's net assets decreased to HK$442,618,000 from HK$465,003,000 as of December 31, 2021, representing a decline of approximately 4.8%[11]. - The total equity attributable to owners of the company was HK$440,977,000 at June 30, 2022, down from HK$463,307,000 at December 31, 2021, indicating a decrease of about 4.8%[11]. - The Group's total liabilities were HK$217,395,000 as of June 30, 2022, compared to HK$209,751,000 at the end of 2021[35]. - The Group had an outstanding shareholder's loan of HK$122.2 million as of June 30, 2022, compared to HK$114.5 million as of December 31, 2021[109]. - The Group had no borrowings as of June 30, 2022[109]. - The Group's gearing ratio as of June 30, 2022, was approximately 49.12%, an increase from 45.11% as of December 31, 2021[109]. Strategic Initiatives - The company is focusing on enhancing its operational efficiency and exploring new market opportunities to drive future growth[7]. - The management is committed to ongoing research and development of new products and technologies to strengthen its market position[7]. - The company is evaluating potential strategic partnerships and acquisitions to expand its market presence and capabilities[7]. - The Group aims to improve battery quality and technology to capture the electric vehicle market[73]. - The Group is exploring strategic alliances and partnerships to enhance technology in high-performance electrical systems and battery technologies[73]. - The Group remains confident in the automotive market, particularly in the PRC, which is the world's largest automotive market[79]. - The Group's expertise in advanced battery technology may drive business growth and generate new revenue streams[79]. - The Board believes that collaboration opportunities in advanced battery technology will be beneficial for the Group's business development[79]. Employee and Operational Metrics - Staff costs, including directors' emoluments, decreased to HK$7,913,000 in 2022 from HK$9,848,000 in 2021, reflecting a reduction of approximately 20%[47]. - The Group had a total of approximately 50 employees as of June 30, 2022, down from 60 employees as of December 31, 2021[113]. - Total staff costs, including Director's remuneration, were approximately HK$7.9 million during the Period, down from approximately HK$9.8 million in the same period of 2021[113]. - The Group's lease interests decreased from HK$195,000 in 2021 to HK$87,000 in 2022, reflecting a decline of approximately 55%[39]. Shareholding and Corporate Governance - Sun East LLC holds 2,673,071,189 shares, representing 13.13% of the issued share capital as of June 30, 2022[87]. - The company has outstanding share options, with Feng Rui holding options for 10,000,000 shares at an exercise price of HK$0.108, expiring on September 5, 2023[95]. - The share option scheme currently in force was adopted on June 13, 2013, and allows for options to be granted to directors and employees[101]. - The percentage of shareholding is calculated based on the total shares issued and does not account for any shares that may be allotted upon the exercise of options[92]. - The company continues to monitor its share options and director holdings as part of its corporate governance strategy[95]. - The Company has confirmed compliance with the Model Code for Securities Transactions by Directors during the period[118]. Regulatory and Compliance Issues - The Company has been suspended from trading since April 1, 2021, and will remain suspended until further notice[133]. - The Company is required to remedy the issues causing its trading suspension and comply with the Listing Rules to the satisfaction of the Stock Exchange[129]. - The Stock Exchange has set a deadline of September 30, 2022, for the Company to address the issues or face potential delisting[126]. - The Company is consulting professional advisers to address the Stock Exchange's concerns and fulfill the requirements under the Resumption Guidance[131]. - The interim results for the Group for the period are unaudited and have been reviewed by the auditor[123].

Impact of COVID-19 - The prolonged COVID-19 pandemic has significantly impacted the automotive industry, affecting research and development progress due to remote working conditions[11]. - The Group faced unprecedented difficulties in raising capital during the pandemic, with delays in securing investments from Europe and the Middle East[13]. - The ongoing COVID-19 pandemic has significantly hindered business development, leading to stagnant revenue and gross profit for the year[60]. - The uncertain macro-economic environment has posed challenges to the Group's research and development progress[49]. - The ongoing COVID-19 pandemic may lead to further negative results, liquidity constraints, and asset impairments, although the exact impact remains uncertain[76]. - The arbitration process with XALT has faced delays due to changes in shareholding and management, as well as the impact of the COVID-19 pandemic[75]. - The Group's financial strength and resources have been prioritized in response to the challenges posed by the COVID-19 pandemic during the years ended 31 December 2020 and 2021[149]. Leadership and Management - Dr. Yeung Yung has been the executive director and chairman of the Group since November 1998, with over 20 years of experience in the automotive industry[22]. - Mr. Feng Rui, appointed as CEO on January 1, 2020, has approximately 30 years of experience in finance and corporate management[23]. - Dr. Wang Chuantao, with over 30 years in manufacturing engineering, was the Chief Die Engineer at General Motors before joining the Group[26]. - Mr. Liu Stephen Quan has over 15 years of experience in investment management and was a founder of several industrial companies in China and the US[26]. - Mr. Ting Kwok Kit, the Chief Financial Officer, has more than 15 years of experience in accounting, finance, and corporate management[29]. - Mr. Li Zhengshan has been responsible for corporate coordination and business development in China since 2003[28]. - The Group is focused on expanding its market presence and enhancing its corporate governance through experienced leadership[27]. - The company aims to leverage its management team's extensive experience to drive future growth and innovation in the automotive sector[27]. - The leadership team is committed to maintaining strong financial performance and operational efficiency[27]. Financial Performance - The Group's revenue for the year amounted to approximately HK$2.6 million, a decrease of 88.1% from HK$21.8 million in 2020[57]. - Gross profit for the year was approximately HK$1.0 million, compared to HK$0.18 million in 2020, indicating a significant increase in gross profit margin[57]. - The loss attributable to shareholders for the year was approximately HK$55.3 million, down from HK$100.8 million in 2020, reflecting a 45% reduction in losses[57]. - Administrative expenses decreased to approximately HK$46.1 million from HK$89.0 million in 2020, a reduction of 48.2%[57]. - As of December 31, 2021, the total equity of the Group amounted to approximately HK$465.0 million, down from HK$507.8 million as of December 31, 2020[87]. - The Group's gearing ratio as of December 31, 2021, was approximately 45.1%, an increase from 39.94% as of December 31, 2020[87]. - The net current assets of the Group were approximately HK$283.2 million as of December 31, 2021, compared to HK$316.9 million as of December 31, 2020[87]. - Cash and cash equivalents amounted to HK$16.4 million as of December 31, 2021, down from HK$35.4 million as of December 31, 2020[87]. - The Group incurred a loss of HK$55.3 million and an operating cash outflow of HK$22.7 million for the year, indicating material uncertainty regarding its ability to continue as a going concern[93]. Strategic Initiatives - The Group is committed to sourcing high-quality manufacturers and suppliers globally for its automotive innovations and products[13]. - There is a new wave of investment in clean energy, particularly in the US, which the Group aims to leverage for capital raising[17]. - The Group plans to double its efforts in 2022 to expand development opportunities and recover lost time during the pandemic[17]. - The Group's strategic direction includes exploring new technologies and products to remain competitive in the market[27]. - The Group is focusing on the development of new energy vehicles and advanced battery technology as a major trend for improving air quality and economic sustainability[63]. - The Group will continue to seek strategic investments and collaborations to strengthen supply chains and enhance production capacity[68]. Governance and Compliance - The company aims to enhance its governance structure through the contributions of its independent non-executive directors[34][36][37][38]. - The company is required to address the disclaimer of opinion from its auditor regarding its consolidated financial statements for the year ended December 31, 2020[80]. - The Stock Exchange has set a deadline of September 30, 2022, for the company to remedy issues causing its trading suspension, or face potential delisting[81]. - The company must comply with the Listing Rules to the satisfaction of the Stock Exchange before trading can resume[80]. - The company is committed to keeping shareholders informed of any material developments as they arise[76]. Investments and Joint Ventures - The Group's primary business includes the development and sale of battery management systems, high-tech electric motor vehicles, and advanced battery materials[46]. - The Group's automotive battery business has been operational since 2011, leveraging a team of experts with extensive experience in the automobile industry[46]. - The Company has contributed RMB360 million for its 18% equity interest in the Ningbo Joint Venture, which focuses on the R&D and production of batteries for new energy vehicles[103]. - The Group is contemplating the potential disposal of its interest in Ningbo Joint Venture for RMB360 million, which represents the total capital contribution made by the Group[107]. - The Group's investment in the Meilai Group represents a 5% equity interest, made at a consideration of RMB60 million[109]. Legal and Dispute Resolution - The company prioritizes preserving financial strength and resources, considering litigation as a last resort[77]. - The Group is actively seeking to re-engage with new management at XALT to resolve disputes amicably and expeditiously[78]. - The Company has engaged legal counsel to consider arbitration proceedings against XALT, although progress has been disrupted by changes in management[149]. - The Group has applied for an execution order against the Guarantors to enforce the Arbitration Award due to non-compliance[116]. - The Group's ability to recover the Compensation Payable is contingent upon the fulfillment of the Arbitration Award by the Guarantors[118].

Financial Performance - Revenue for the six months ended June 30, 2021, was HK$1,070,000, compared to HK$1,764,000 for the same period in 2020, representing a decrease of 39.2%[11] - Gross profit for the period was HK$323,000, down from HK$144,000 in 2020, indicating an increase in gross profit margin despite lower revenue[11] - Loss from operations was HK$20,941,000, an improvement from a loss of HK$24,323,000 in the previous year, reflecting a reduction in operating expenses[11] - Loss before tax for the period was HK$21,136,000, compared to HK$24,814,000 in 2020, showing a decrease of 14.8%[11] - Total comprehensive loss for the period was HK$25,687,000, down from HK$31,434,000 in the same period last year, indicating a positive trend in overall financial performance[11] - Loss per share for the period was HK$0.10, an improvement from HK$0.12 in 2020, suggesting better performance on a per-share basis[11] - The company reported a total comprehensive loss attributable to owners of the Company of HK$25,685,000, down from HK$30,827,000 in the previous year[11] - The company experienced a total comprehensive loss of HK$30,827,000 for the six months ended June 30, 2021, compared to a loss of HK$31,434,000 in the same period in 2020, indicating a slight improvement[15] - The group reported a loss for the period of approximately HK$21,120,000, compared to a loss of approximately HK$24,736,000 in 2020, indicating an improvement in financial performance[64] Cash Flow and Assets - The net cash used in operating activities for the six months ended June 30, 2021, was HK$10,156,000, a significant improvement compared to HK$124,199,000 used in the same period in 2020[18] - Cash and cash equivalents at the end of the period were HK$17,059,000, down from HK$36,539,000 at the end of June 2020, reflecting a decrease of approximately 53%[18] - The company reported a net cash generated from investing activities of HK$783,000 for the six months ended June 30, 2021, compared to no cash generated in the same period in 2020[18] - As of June 30, 2021, the company's net assets decreased to HK$482,111,000 from HK$507,798,000 as of December 31, 2020, representing a decline of approximately 5%[14] - The total assets of the Group as of June 30, 2021, were HK$673,647,000, a decrease from HK$710,635,000 at the end of 2020, indicating a decline of approximately 5.2%[49] - The total equity attributable to owners of the company was HK$480,448,000, down from HK$506,133,000, indicating a decrease of about 5.1%[15] - The Group had an outstanding shareholder's loan of HK$98.8 million as of June 30, 2021, which was unsecured and interest-free[155] Operational Efficiency - The company continues to focus on reducing costs and improving operational efficiency as part of its strategic initiatives[11] - Distribution costs and general operating expenses decreased to approximately HK$17.8 million from HK$21.8 million in 2020, a reduction of about 18.3%[88] - Lease interest expenses decreased to HK$195,000 in 2021 from HK$491,000 in 2020, indicating cost management efforts[55] - The lease liabilities decreased significantly from HK$10,620,000 to HK$4,033,000, a reduction of approximately 62%[14] Future Outlook and Strategy - Future outlook includes potential market expansion and new product development to enhance revenue streams[11] - The Group is committed to developing advanced battery technology and exploring collaboration opportunities to enhance its business and generate new revenue streams[94] - The Group aims to strengthen its supply chains and enhance production capacity through strategic investments and collaborations[95] - The Group is actively seeking strategic investments and collaborations to enhance its supply chain, increase capacity, and improve operational flexibility[97] Shareholder Information - As of June 30, 2021, Sun East LLC holds 2,673,071,189 shares, representing 13.13% of the issued share capital of the Company[112] - Dr. Yeung Yung, through controlled corporations, has a total interest in 2,741,211,189 shares, accounting for 13.47% of the issued share capital[112] - The total number of shares in issue was 20,352,872,747[122] - The company has share options outstanding amounting to 20,000,000 shares, equating to 0.10% of the total shareholding[129] Legal and Compliance Issues - The Company has been suspended from trading since April 1, 2021, and will remain suspended until further notice[174] - The Company is required to remedy the issues causing its trading suspension and fully comply with the Listing Rules to the satisfaction of the Stock Exchange before trading can resume[171] - The Stock Exchange expressed concerns that the Company did not maintain a sufficient level of operation and assets to comply with Rule 13.24 of the Listing Rules[168] - The Company received Resumption Guidance from the Stock Exchange to address the Audit Issues and provide sufficient information for investors[168] - The ongoing legal dispute with XALT, initiated in 2017, has seen limited progress due to changes in management and the impact of the COVID-19 pandemic[102] - The Group will keep shareholders informed of any material developments regarding the ongoing legal proceedings[105] - The Group is exploring mediation options with XALT to resolve the ongoing legal dispute amicably[102] COVID-19 Impact - The Group is prioritizing the preservation and enhancement of financial strength and resources amid the challenges posed by the COVID-19 pandemic[107] - The exact impact of the COVID-19 pandemic on the Group's business in the second half of 2021 remains uncertain, with potential for continued negative results and liquidity constraints[107]

Financial Performance - The Group's revenue for 2020 amounted to HK$21,825,000, an increase of 33.3% from HK$16,342,000 in 2019[11] - Gross profit from continuous operations was HK$176,000, up from HK$12,443,000 in 2019, indicating a significant increase in profitability[11] - The company reported a significant increase in revenue, achieving a total of $1.2 billion for the fiscal year, representing a 15% year-over-year growth[39] - The company provided guidance for the next fiscal year, projecting revenue growth of 10% to $1.32 billion[39] - The Group's revenue for the year amounted to approximately HK$21.8 million, an increase from HK$16.3 million in 2019, while gross profit was approximately HK$0.18 million, down from HK$12.4 million in 2019[54] - The loss attributable to shareholders for the year was approximately HK$100.8 million, significantly reduced from HK$643.8 million in 2019, primarily due to decreased administrative expenses[54] Research and Development - The pandemic has severely impacted R&D efficiency, causing delays in product development due to remote working conditions[11] - Research and development expenses increased by 30%, totaling $100 million, to support new technology initiatives[39] - The pandemic significantly hindered the Group's research and development progress, particularly in Europe and North America, affecting negotiations with potential partners[46] - The Company is focused on technological advancements in the automotive industry and aims to achieve significant milestones as the global economy recovers in 2021[47] Capital Raising and Investment - The Group faced unprecedented difficulties in raising capital during the pandemic, with potential investors becoming more cautious[11] - Despite the challenges, there is a new wave of investment in clean energy, particularly in the US, creating a favorable capital environment for the industry[13] - The successful IPOs of several mainland clean energy automobile companies have positively influenced the capital landscape[13] - The Board has engaged in constant discussions with private equity firms and investment banks to explore new capital-raising strategies[13] - The Group aims to achieve a breakthrough in securing strong capital support for its clean energy vehicle projects in the upcoming year[13] - The Group is actively exploring new fundraising avenues and has developed new fundraising plans to support its clean energy vehicle projects[16] - The Company is actively exploring various fundraising opportunities, including equity financing, debt financing, and collaborations with potential business partners[102] Market Trends and Strategy - The Group believes that demand for high-tech, clean, and sustainable transportation will continue to grow due to global urbanization and environmental regulations[51] - The Group is focused on the development of new energy vehicles and advanced battery technology as a major trend for improving air quality and economic sustainability[59] - The Group aims to leverage the strong recovery of the US economy to capitalize on the clean energy investment boom, particularly through the use of financial instruments like SPACs[16] - The Group plans to continue seeking strategic investments and collaborations to strengthen supply chains and enhance production capacity[61] Management and Leadership - Dr. Huang Chunhua has extensive experience in the automotive and transport infrastructure sectors, having been a pioneering financier for China's first wave of private companies going public in Hong Kong during 1999 and 2001[23] - Mr. Liu Stephen Quan has over 15 years of experience in investment management and has been involved in founding several industrial and investment companies in China and the US[25] - Dr. Zhu Shengliang possesses extensive experience in finance and corporate management, having held senior managerial roles in several companies, including Shanghai Shenhua Holdings Co., Ltd.[27] - Mr. Ting Kwok Kit has more than 15 years of experience in accounting, finance, and corporate management, and is currently the Chief Financial Officer of the Company[29] - The Company has a diverse board of directors with expertise in various fields, including finance, engineering, and law, enhancing its strategic decision-making capabilities[31] - The management team has a strong educational background, with degrees from prestigious institutions such as Peking University and The Ohio State University, contributing to the Company's leadership strength[32] Legal and Compliance Issues - The Company is actively seeking to resolve a legal dispute with XALT, which has been ongoing since 2017, while prioritizing financial stability due to the COVID-19 pandemic[70] - The Group incurred a loss of HK$100.8 million and an operating cash outflow of HK$94.4 million for the Year, indicating material uncertainty regarding the Group's ability to continue as a going concern[100] - The Audit Committee and the Board believe that the Group will have sufficient working capital for at least twelve months from the end of the reporting period, thus supporting the preparation of financial statements on a going concern basis[104] - The Group's financial statements reflect significant uncertainties related to going concern, primarily due to the losses and cash outflows reported[100] - The ongoing arbitration has prevented the Company from obtaining the latest consolidated management accounts for the year ended 31 December 2020[116] Shareholding and Options - As of December 31, 2020, the total number of shares issued by the company was 20,352,872,747[162] - The company has outstanding options totaling 10,000,000 shares at an exercise price of HK$0.108, expiring on September 5, 2023[165] - The total share options exercised as of December 31, 2020, amounted to 356,500,000[185] - The total number of employees with share options was 81,500,000, with a net of 71,500,000 exercised[185] - The total eligible persons for share options amounted to 266,000,000[185]

Financial Performance - Revenue for the six months ended June 30, 2020, was HK$1,764,000, compared to HK$16,816,000 for the same period in 2019, representing a decrease of approximately 89.5%[16] - Gross profit for the period was HK$144,000, down from HK$13,130,000 in 2019, indicating a significant decline in profitability[16] - Loss for the period attributable to owners of the Company was HK$24,736,000, compared to HK$73,130,000 in the previous year, showing an improvement of approximately 66.1%[16] - Total comprehensive loss for the period was HK$31,434,000, a decrease from HK$79,062,000 in 2019, reflecting a reduction of about 60.2%[16] - Basic and diluted loss per share was HK$0.12, compared to HK$0.36 for the same period in 2019, indicating a decrease in loss per share[16] - The company reported a loss before tax of HK$24,814,000, compared to HK$73,170,000 in the same period last year, indicating a reduction of about 66.0%[16] - The consolidated loss for the period was HK$24,814,000, compared to a loss of HK$73,170,000 in the previous year[37] - The Group reported a loss for the period of approximately HK$24,736,000, a decrease from a loss of approximately HK$73,130,000 in 2019, representing a reduction of about 66.1%[50] Operational Efficiency - The company is focusing on improving operational efficiency and reducing costs to enhance future performance[16] - Total staff costs, including directors' emoluments, decreased to HK$8,480,000 in 2020 from HK$54,911,000 in 2019, reflecting a decline of approximately 84.6%[48] - Distribution costs and general operating expenses decreased to approximately HK$21.8 million from HK$83.6 million in 2019, a reduction of about 73.9%[72] Assets and Liabilities - As of June 30, 2020, total current assets amounted to HK$568,060,000, an increase of 15.2% from HK$493,009,000 as of December 31, 2019[18] - The net current assets decreased to HK$337,504,000 from HK$358,912,000, reflecting a decline of 5.4%[18] - Total liabilities as of June 30, 2020, were HK$234,061,000, a decrease from HK$144,266,000 as of December 31, 2019[39] - The total equity attributable to owners of the Company decreased to HK$507,381,000 from HK$538,208,000, a decline of 5.7%[18] - The Group's total assets increased to HK$770,103,000 as of June 30, 2020, compared to HK$711,742,000 at the end of 2019[39] Cash Flow - The company reported a net cash used in operating activities of HK$(124,199,000) for the six months ended June 30, 2020, compared to HK$(54,824,000) in the same period of 2019[24] - Cash and cash equivalents at the end of the period increased to HK$36,539,000 from HK$15,559,000, representing a significant increase of 134.5%[24] - Operating cash outflow for the same period was HK$124,199,000, indicating significant financial strain[26] Shareholder Support - The Group's ability to continue as a going concern is dependent on financial support from the major shareholder[26] - The major shareholder has agreed to provide adequate funds to meet the Group's liabilities as they fall due[26] Fair Value Measurements - The Group's fair value measurements as of June 30, 2020, for unlisted equity securities amounted to HK$13,743,000, down from HK$14,031,000 as of December 31, 2019[28] - The total recurring fair value measurements for the Group as of June 30, 2020, were HK$13,743,000[28] - As of June 30, 2020, the Group reported a decrease in the fair value of equity investments at fair value through other comprehensive income due to an exchange difference of HK$288,000[32] Legal and Regulatory Matters - The Group is actively seeking to resolve a legal dispute with XALT, which began in 2017, and is exploring mediation options while preparing for arbitration proceedings[91] - The Group is committed to keeping shareholders informed of any material developments regarding the legal dispute[91] - The legal dispute with XALT involves a supply agreement for battery cells dated March 25, 2015[91] COVID-19 Impact - The COVID-19 pandemic has negatively impacted the global business environment, with potential adverse effects on the Group's operating and financial results, although the extent is currently unquantifiable[91] - The Group will continue to monitor the impact of the COVID-19 pandemic and adjust its strategies accordingly[91] Share Options and Director Interests - The total number of shares in issue as of June 30, 2020, is 20,352,872,747[97] - The exercise price for share options granted to directors ranges from HK$0.108 to HK$0.201, with underlying shares totaling 10,000,000 to 50,000,000 for various directors[105] - The interests of directors and chief executives in the shares of the Company are recorded in compliance with the Securities and Futures Ordinance[102] Corporate Governance - The Company has adopted the Model Code for Securities Transactions by Directors, ensuring compliance with required standards during the period[137][136] - The Company complied with the Corporate Governance Code throughout the period, reflecting adherence to governance standards[126][131] - The audit committee reviewed the Group's financial statements, ensuring oversight of financial reporting[138]

Financial Performance - The company reported a consolidated profit of $XX million for the year 2019, representing a YY% increase compared to the previous year[2]. - The Group's revenue from continuous operations in 2019 was approximately HK$16.3 million, a decrease of 73% from HK$61.3 million in 2018[11]. - Gross profit for 2019 was HK$12.4 million, up from HK$8.3 million in 2018, indicating a significant improvement in profit margin despite lower revenue[11]. - The loss attributable to shareholders for the year amounted to approximately HK$644.0 million, up from HK$288.6 million in 2018, primarily due to an increase in share of loss of associates by approximately HK$231.1 million[54]. - Administrative expenses rose to approximately HK$439.2 million, an increase of 20% from HK$365.4 million in 2018, driven by a significant rise in research and development expenses from HK$21.9 million to HK$208.8 million[54]. - The Group's revenue for the year was approximately HK$16.3 million, a decrease of 73% from HK$61.3 million in 2018, while gross profit increased to HK$12.4 million from HK$8.3 million[54]. Market and Growth Strategy - User data showed a growth of ZZ% in active users, reaching a total of AA million by the end of 2019[3]. - The company provided a revenue guidance of $BB million for the upcoming fiscal year, indicating a projected growth of CC%[4]. - New product launches contributed to a revenue increase of $DD million, accounting for EE% of total sales[5]. - Market expansion efforts have led to a YY% increase in market share in key regions, with a focus on Asia-Pacific[7]. - The company plans to enter the European market in 2020, targeting a revenue contribution of $II million within the first year[10]. - The Group aims to expand its high-tech electric vehicle business in response to increasing demand driven by global urbanization and environmental regulations[51]. Research and Development - The company is investing $FF million in R&D for new technologies aimed at enhancing product offerings[6]. - Continuous research and development efforts are focused on single and few-layer graphene, which is considered an ideal material for super batteries and power electronic systems in electric vehicles[46]. - The Group is developing a high voltage battery pack strategy that utilizes a common battery cell and module for all cars, allowing for flexible configurations to optimize space without compromising vehicle design[42]. - The Group is committed to developing advanced battery materials, including single-layer and multi-layer graphene for electric vehicle applications[50]. Corporate Governance - The company has a strong governance structure with independent non-executive directors serving on various committees, including audit, nomination, and remuneration[36]. - The board includes members with diverse academic backgrounds and professional experiences, enhancing the company's strategic decision-making capabilities[36]. - The company is committed to maintaining high standards of corporate governance and compliance with regulatory requirements[36]. - The board emphasizes maintaining strong relationships with stakeholders, which is beneficial for the long-term development of the company[180]. - The company has complied with the Corporate Governance Code throughout the year ended December 31, 2019[182]. Legal and Compliance Issues - The legal dispute with XALT has not progressed to arbitration in Hong Kong as of the latest update, and the Company is prepared to defend against any claims[59]. - The Company has engaged legal advisers in Hong Kong to handle the arbitration process and will follow their advice on the appropriate strategies[60]. - The COVID-19 pandemic has impacted the global business environment, and the Group will adjust to market conditions as necessary[62]. - The Audit Committee and the Board acknowledged the Auditor's disclaimer of opinion was due to material uncertainty about the Group's ability to continue as a going concern, particularly concerning the cash flow projections of the cash-generating units[76]. Human Resources - The Group had approximately 100 employees as of December 31, 2019, a significant decrease from 228 employees as of December 31, 2018[87]. - The Company Secretary undertook at least 15 hours of relevant professional training annually to update skills and knowledge[188]. - All Directors are entitled to access Board papers and related materials at least 3 days before meetings[192]. Environmental Commitment - The board of directors emphasized a commitment to sustainable practices, allocating $JJ million towards green initiatives[11]. - The Group is committed to environmentally friendly strategies, including energy-efficient practices and sustainable development measures[173]. - The company is committed to environmental sustainability through strategies such as energy-efficient lighting and recycling initiatives[177]. Shareholder Information - As of December 31, 2019, the total equity of the Group was approximately HK$567.5 million, a decrease from HK$1,239 million as of December 31, 2018[83]. - The total number of shares issued as of December 31, 2019, is 20,352,872,747[105]. - The Company does not recommend the payment of any final dividend for the year ended December 31, 2019, similar to 2018[165].

Financial Performance - Revenue for the six months ended June 30, 2019, was HK$16,816,000, a decrease of 52.6% compared to HK$35,451,000 in the same period of 2018[11] - Gross profit for the period was HK$13,130,000, compared to HK$6,557,000 in the previous year, indicating a significant increase in gross profit margin[11] - Loss before tax for the period was HK$73,170,000, a reduction from a loss of HK$182,606,000 in the same period of 2018, showing an improvement in financial performance[11] - Total comprehensive loss for the period was HK$79,062,000, compared to HK$193,754,000 in the previous year, reflecting a decrease of 59.1%[11] - Loss per share for the period was 0.36 cents, an improvement from 0.89 cents in the same period of 2018[11] - Other comprehensive loss for the period amounted to HK$5,892,000, down from HK$11,133,000 in the previous year, indicating better management of foreign exchange differences[11] - The company reported a gross profit margin of 78.1% for the period, compared to 18.5% in the previous year, highlighting improved cost management[11] - Total comprehensive loss for the period was HK$191,722, reflecting ongoing challenges in the market[16] - The company's equity attributable to owners decreased to HK$1,130,941, down from HK$1,209,437 at the end of 2018[16] - The company reported a corporate and unallocated loss of HK$57,586,000 for the period, compared to a loss of HK$91,970,000 in the previous year[46] - The financial results reflect ongoing challenges in the market, but improvements in loss figures suggest a potential for recovery[46] Cash Flow and Liquidity - The company had cash and cash equivalents of HK$XX,XXX,XXX as of June 30, 2019, providing a solid liquidity position for future operations[13] - Cash and cash equivalents at the end of the period were HK$15,559, significantly down from HK$98,409 in the same period of 2018[20] - Net cash used in operating activities was HK$54,824, compared to HK$182,777 in the previous year, indicating improved cash flow management[20] - The company generated HK$23,200 from investing activities, a recovery from a net cash used of HK$35,036 in the prior year[20] - As of June 30, 2019, net current assets decreased to HK$493,807, down 10.5% from HK$551,964 at the end of 2018[14] - The Group's gearing ratio as of June 30, 2019, was approximately 7.03%, an increase from 4.94% as of December 31, 2018[168] Assets and Liabilities - As of June 30, 2019, total assets less current liabilities amounted to HK$1,176,005, a decrease of 5.1% from HK$1,239,048 as of December 31, 2018[14] - Total assets as of June 30, 2019, were HK$1,241,519,000, a decrease from HK$1,300,218,000 as of December 31, 2018[51] - Total liabilities as of June 30, 2019, were HK$81,533,000, an increase from HK$61,170,000 as of December 31, 2018[51] - The Group reported a total equity of HK$1,159,986, a decline of 6.4% from HK$1,239,048 at the end of 2018[14] Research and Development - The company plans to enhance its research and development efforts to innovate new technologies and products in the upcoming quarters[9] - Research and development costs decreased to HK$1,249,000 from HK$17,809,000 in 2018, a reduction of approximately 93%[65] - The Group has developed a prototype high voltage battery pack using a 28Ah lithium-ion battery cell with graphene coating, aimed at improving conductivity and charging speed[92] - The Group is optimizing its core R&D organization to enhance the development of multiple cross-platform vehicles and has initiated prototype development for its first luxury model[99] - The Group is actively developing advanced battery materials, applying graphene technologies to improve the conductivity of high voltage battery packs for faster charging[100] Market and Business Strategy - The company is focusing on market expansion and new product development to drive future growth, although specific figures were not disclosed during the call[9] - The market for high-tech electric motor vehicles and advanced battery materials remains a focus, although specific revenue figures for these segments were not disclosed[52] - The Group is actively seeking collaboration opportunities with potential business partners and investors to further develop and expand its business[97] - The planned implementation of multiple sedan and SUV models is expected to enhance the Group's development in the foreseeable future[96] - The Group is negotiating with potential business partners to expand its operations in other provinces of China, aiming to establish new manufacturing bases[109] Share Capital and Options - The total number of shares in issue as of June 30, 2019, is 20,352,872,747[132] - The company has granted share options totaling 110,000,000 underlying shares, representing approximately 0.54% of the issued share capital[143] - The total number of share options granted as of June 30, 2019, was 2,017,000,000[157] - The total number of share options exercised during the period was 278,000,000[157] - The total number of share options lapsed or cancelled during the period was 566,500,000[157] Legal and Regulatory Matters - The Group is considering initiating arbitration in Hong Kong to expedite the resolution of the ongoing lawsuit with XALT, which may take considerable time to conclude[118] - The U.S. District Court has ordered that the lawsuit against the Group be stayed and administratively closed pending the conclusion of arbitration in Hong Kong[115] - The Group's legal advisors have been engaged to handle the arbitration process, should it be initiated[118] Employee and Operational Metrics - The Group had a total of approximately 157 employees as of June 30, 2019, down from 228 employees as of December 31, 2018[178] - The Group did not undertake any fundraising activities during the period[181] - The interim results for the period were unaudited but reviewed by the auditors of the Company[182]