[Financial Highlights](index=1&type=section&id=Financial%20Highlights) The company's financial performance for the six months ended September 30, 2023, shows increased revenue but decreased gross profit and profit attributable to owners of the company | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 282,337 | 213,790 | +32.1% | | Gross Profit | 40,799 | 45,356 | -10.0% | | Gross Profit Margin | 14.5% | 21.2% | -6.7pp | | Profit Attributable to Owners of the Company | 14,919 | 30,953 | -51.8% | | Interim Dividend Per Share (HK cents) | 0.7 | 1.6 | -56.3% | [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the group's condensed consolidated financial statements, including the statement of profit or loss, financial position, and cash flows [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended September 30, 2023, the group saw significant revenue growth, but increased service costs, administrative expenses, and finance costs, alongside reduced other income, led to a substantial decline in gross profit and profit attributable to owners of the company | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 282,337 | 213,790 | | Cost of Services | (241,538) | (168,434) | | Gross Profit | 40,799 | 45,356 | | Other Income and Other Gains | 1,362 | 6,402 | | Impairment Losses Under Expected Credit Loss Model, Net of Reversals | (1,295) | (1,295) | | Administrative Expenses | (21,271) | (14,410) | | Finance Costs | (1,027) | (259) | | Profit Before Tax | 18,568 | 35,794 | | Income Tax Expense | (3,268) | (4,880) | | Profit and Total Comprehensive Income for the Period | 15,300 | 30,914 | | Profit Attributable to Owners of the Company for the Period | 14,919 | 30,953 | | Profit Attributable to Non-controlling Interests for the Period | 381 | (39) | | Basic Earnings Per Share (HK cents) | 1.9 | 3.9 | | Diluted Earnings Per Share (HK cents) | 1.9 | Not Applicable | [Condensed Consolidated Statement of Financial Position](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of September 30, 2023, the group's total assets and total equity slightly increased, while current liabilities decreased, indicating a stable financial position | Indicator | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | **ASSETS** | | | | Non-current Assets | 102,356 | 92,550 | | Current Assets | 453,996 | 459,451 | | **TOTAL ASSETS** | **556,352** | **552,001** | | **LIABILITIES** | | | | Current Liabilities | 148,592 | 146,312 | | Non-current Liabilities | 7,734 | 8,277 | | **TOTAL LIABILITIES** | **156,326** | **154,589** | | **EQUITY** | | | | Equity Attributable to Owners of the Company | 400,412 | 398,179 | | Non-controlling Interests | (386) | (767) | | **TOTAL EQUITY** | **400,026** | **397,412** | | **TOTAL ASSETS LESS CURRENT LIABILITIES** | **407,760** | **405,689** | | **NET CURRENT ASSETS** | **305,404** | **313,139** | [Notes to the Condensed Consolidated Financial Statements](index=5&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes explaining the basis of preparation, significant accounting policies, and specific financial statement line items [Basis of Preparation and Significant Accounting Policies](index=5&type=section&id=Basis%20of%20Preparation%20and%20Significant%20Accounting%20Policies) These interim financial statements are prepared under HKAS 34 and Listing Rules, using historical cost basis, with no significant impact from revised HKFRSs - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[15](index=15&type=chunk) - The condensed consolidated financial statements are prepared on the historical cost basis, except for financial assets at fair value through profit or loss which are measured at fair value at the end of the reporting period[16](index=16&type=chunk) - The application of the revised Hong Kong Financial Reporting Standards during the current period had **no significant impact** on the group's financial position and performance and/or disclosures contained in these condensed consolidated financial statements for the current and prior periods[43](index=43&type=chunk) [Revenue and Segment Information](index=6&type=section&id=Revenue%20and%20Segment%20Information) All group revenue is derived from M&E engineering services provided to Hong Kong clients, constituting a single operating segment - The group's customers for M&E engineering services are primarily property owners, construction companies, and private sector contractors in Hong Kong[20](index=20&type=chunk) - All the group's revenue is derived from customers located in Hong Kong, and all its non-current assets (excluding financial instruments and deferred tax assets) are located in Hong Kong[21](index=21&type=chunk) - In accordance with Hong Kong Financial Reporting Standard 8 Operating Segments, the group has **only one single reporting and operating segment**[45](index=45&type=chunk) [Other Income and Other Gains](index=6&type=section&id=Other%20Income%20and%20Other%20Gains) Other income and gains significantly decreased this period, primarily due to reduced government grants from the Employment Support Scheme in the prior year | Item | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Interest income | 283 | 238 | | Government grants | – | 5,617 | | Rental income | 78 | 152 | | Other income | 968 | 345 | | Gain on disposal of property, plant and equipment | – | 50 | | Gain on derecognition of right-of-use assets | 33 | – | | **Total** | **1,362** | **6,402** | - The decrease in other income and other gains was mainly due to a **reduction of approximately HK$5,617,000** in government grants from the Employment Support Scheme provided by the Hong Kong Government in the corresponding period last year[63](index=63&type=chunk) [Finance Costs](index=7&type=section&id=Finance%20Costs) Finance costs increased significantly this period, mainly driven by higher interest expenses on bank borrowings | Item | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Interest on bank borrowings | 796 | 170 | | Interest on lease liabilities | 231 | 89 | | **Total** | **1,027** | **259** | [Profit Before Tax](index=7&type=section&id=Profit%20Before%20Tax) Profit before tax decreased, influenced by increased depreciation of property, plant and equipment, right-of-use assets, staff costs, and donations | Item | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 2,676 | 563 | | Depreciation of right-of-use assets | 2,713 | 1,965 | | Depreciation of investment properties | 111 | 18 | | Total staff costs | 41,963 | 37,315 | | Donations | 3,000 | 500 | [Income Tax Expense](index=7&type=section&id=Income%20Tax%20Expense) Income tax expense decreased due to lower taxable profit this period, with Hong Kong profits tax at 16.5% and a two-tiered rate for some subsidiaries | Item | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong Profits Tax – Current tax | 3,268 | 4,880 | - Hong Kong Profits Tax is calculated at 16.5% of the estimated assessable profit, with Chit Tat M&E Engineering Company Limited, a wholly-owned subsidiary, being a qualifying corporation under the two-tiered profits tax regime, taxed at 8.25% for the first HK$2 million and 16.5% for amounts exceeding HK$2 million[26](index=26&type=chunk) - The decrease in income tax expense was mainly due to the **decrease in assessable profit** for the period[93](index=93&type=chunk) [Dividends](index=8&type=section&id=Dividends) The Board declared an interim dividend of 0.7 HK cents per ordinary share for the six months ended September 30, 2023, a decrease from the prior year | Item | For the six months ended September 30, 2023 | For the six months ended September 30, 2022 | | :--- | :--- | :--- | | Interim dividend (per ordinary share) | 0.7 HK cents | 1.6 HK cents | | Total interim dividend | HK$5,600,000 | HK$12,800,000 | - During the interim period, a final dividend of **1.6 HK cents per ordinary share** (totaling HK$12,800,000) for the year ended March 31, 2023, was declared to the owners of the company[27](index=27&type=chunk) [Earnings Per Share](index=8&type=section&id=Earnings%20Per%20Share) Basic earnings per share for the period was 1.9 HK cents, a decrease from the prior year, with diluted earnings per share presented due to share awards | Indicator | For the six months ended September 30, 2023 | For the six months ended September 30, 2022 | | :--- | :--- | :--- | | Basic Earnings Per Share (HK cents) | 1.9 | 3.9 | | Diluted Earnings Per Share (HK cents) | 1.9 | Not Applicable | | Weighted average number of ordinary shares for basic EPS | 800,000,000 | 800,000,000 | | Weighted average number of ordinary shares for diluted EPS | 800,155,881 | Not Applicable | - No diluted earnings per share for any past period was presented as there were **no potential dilutive shares** in issue[52](index=52&type=chunk) [Trade and Other Receivables, Deposits and Prepayments](index=9&type=section&id=Trade%20and%20Other%20Receivables%2C%20Deposits%20and%20Prepayments) Total trade and other receivables, deposits, and prepayments decreased, primarily due to enhanced receivables control processes, with credit terms typically 7 to 90 days | Item | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Trade receivables (net of allowance for credit losses) | 83,309 | 104,695 | | Other receivables (net of allowance for credit losses) | 3,587 | 2,505 | | Refundable rental deposits | 823 | 966 | | Amount due from non-controlling interests of a subsidiary | 994 | – | | Prepayments for purchase of materials and subcontracting fees | 7,130 | 12,181 | | Prepaid expenses | 1,709 | 2,965 | | Utilities and other deposits | 722 | 720 | | **Total** | **98,274** | **124,032** | - The group generally grants credit terms of **7 to 90 days** to its customers[30](index=30&type=chunk) - The decrease in trade receivables was mainly due to **enhanced receivables control processes**[121](index=121&type=chunk) | Ageing | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 39,678 | 35,751 | | 31 to 90 days | 24,799 | 55,925 | | 91 to 180 days | 9,013 | 7,272 | | Over 180 days | 10,450 | 6,378 | | Less: Allowance for credit losses | (631) | (631) | | **Total** | **83,309** | **104,695** | [Bank Borrowings](index=10&type=section&id=Bank%20Borrowings) Total bank borrowings slightly decreased, secured by company guarantees and certain properties, and classified as current liabilities due to banks' right to modify or cancel financing at any time | Item | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Bank borrowings | 45,603 | 47,550 | - The bank borrowings are secured by **corporate guarantees** provided by the company and by **two parking spaces and an office** of the group[81](index=81&type=chunk) - The banks may, at their sole discretion, amend, cancel or suspend the banking facilities at any time without prior notice, and accordingly, the group's bank borrowings were classified as current liabilities at those dates[32](index=32&type=chunk) [Management Discussion and Analysis](index=11&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's perspective on the group's business performance, financial position, future outlook, and key operational aspects [Business Overview](index=11&type=section&id=Business%20Overview) As a long-established M&E engineering service provider in Hong Kong, the group focuses on increasing market share, prudently managing macroeconomic changes, maintaining competitive pricing, and investing in R&D through joint laboratories for innovative technology applications - The group is a long-established M&E engineering service provider, primarily engaged in the supply, installation, and maintenance of mechanical ventilation and air-conditioning systems, drainage systems, water supply, swimming pool and fountain systems, electrical and control systems, and building intelligent systems[58](index=58&type=chunk) - The group's primary focus remains on "striving to **increase market share**; prudently grasping macroeconomic changes; timely adjusting the group's operating strategies and maintaining competitive pricing strategies"[59](index=59&type=chunk) - The group established the "Chit Tat - Education University of Hong Kong Metaverse and Human-Computer Interaction Joint Laboratory" in 2022 and is committed to supporting the establishment of a joint laboratory with The Hong Kong Polytechnic University in the metaverse field to promote smart city development and innovation[84](index=84&type=chunk) [Business Review](index=11&type=section&id=Business%20Review) During the period, Hong Kong's economic and business environment slightly improved, with the group's contract value remaining stable at approximately HK$1 billion, reflecting client recognition of its management and capabilities - The group's contract value remained stable at approximately **HK$1 billion** during the period, which also demonstrates clients' recognition of the group's management, capabilities, and project management[59](index=59&type=chunk) - During the period, Hong Kong's economic situation and business environment **slightly improved** compared to the same period last year[85](index=85&type=chunk) [Financial Review](index=12&type=section&id=Financial%20Review) The group experienced significant revenue growth but a decline in gross profit and profit attributable to owners of the company, primarily due to increased service costs, administrative expenses, and reduced other income, with balance sheet items also reflecting business activities and receivables control [Revenue](index=12&type=section&id=Revenue_Financial%20Review) Revenue increased significantly, driven by progress on residential projects and completion of several residential and commercial projects | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 282,337 | 213,790 | +32.1% | - The increase in revenue was mainly due to the progress of certain residential projects located in Kai Tak and Tin Shui Wai, which were in the early stages of project implementation[60](index=60&type=chunk) - Additionally, the group completed several residential and commercial projects during the period, contributing to a **significant increase in revenue**[60](index=60&type=chunk) [Cost of Services](index=12&type=section&id=Cost%20of%20Services) Service costs increased in line with revenue growth, primarily comprising material costs, direct labor, and subcontracting fees for on-site work | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Cost of Services | 241,538 | 168,434 | +43.4% | - Cost of services primarily refers to material costs (including accessories for mechanical ventilation and air-conditioning systems such as air conditioners and ventilation fans, as well as pipes and fittings), direct labor costs, and subcontracting fees for completing on-site works[60](index=60&type=chunk) - The increase in cost of services is **consistent with the increase in the group's revenue**[60](index=60&type=chunk) [Gross Profit and Gross Profit Margin](index=12&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit and gross profit margin decreased, mainly due to revenue generated from lower-margin projects, which helped enhance market share and brand image | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 40,799 | 45,356 | -10.0% | | Gross Profit Margin | 14.5% | 21.2% | -6.7pp | - The decrease in gross profit margin was mainly due to the revenue generated from **lower-margin projects** awarded during the same period, which helped enhance market share and build brand image[62](index=62&type=chunk)[89](index=89&type=chunk) [Other Income and Other Gains](index=12&type=section&id=Other%20Income%20and%20Other%20Gains_Financial%20Review) Other income and gains decreased significantly, primarily due to a reduction in government grants from the Employment Support Scheme in the prior year | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Other Income and Other Gains | 1,362 | 6,402 | -78.7% | - The decrease in other income and other gains was mainly due to a **reduction of approximately HK$5,617,000** in government grants from the Employment Support Scheme provided by the Hong Kong Government in the corresponding period last year[63](index=63&type=chunk) [Administrative Expenses](index=13&type=section&id=Administrative%20Expenses) Administrative expenses increased, mainly due to a HK$3 million donation to Hong Kong Polytechnic University for establishing a joint laboratory | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 21,271 | 14,410 | +47.6% | - The increase in administrative expenses was mainly due to a **donation of HK$3,000,000** made to The Hong Kong Polytechnic University for the establishment of a joint laboratory[92](index=92&type=chunk) [Income Tax Expense](index=13&type=section&id=Income%20Tax%20Expense_Financial%20Review) Income tax expense decreased, primarily due to a reduction in taxable profit during the period | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Income Tax Expense | 3,268 | 4,880 | -33.0% | - The decrease in income tax expense was mainly due to the **decrease in assessable profit** for the period[93](index=93&type=chunk) [Profit and Total Comprehensive Income Attributable to Owners of the Company](index=13&type=section&id=Profit%20and%20Total%20Comprehensive%20Income%20Attributable%20to%20Owners%20of%20the%20Company) Profit and total comprehensive income attributable to owners of the company decreased, mainly due to reduced gross profit and increased administrative and finance costs | Indicator | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended September 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Profit and Total Comprehensive Income Attributable to Owners of the Company | 14,919 | 30,953 | - The decrease in profit and total comprehensive income attributable to owners of the company was mainly due to the **decrease in gross profit** and the **increase in administrative expenses and finance costs** during the period[94](index=94&type=chunk) [Interim Dividend](index=13&type=section&id=Interim%20Dividend) The Board resolved to declare an interim dividend of 0.7 HK cents per share, totaling approximately HK$5.6 million, payable around January 10, 2024 - The Board has resolved to declare an interim dividend of **0.7 HK cents per share** of the company for the period, amounting to approximately HK$5,600,000[94](index=94&type=chunk) - The interim dividend will be paid to shareholders whose names appear on the register of members of the company at the close of business on December 15, 2023, and will be paid on or about **January 10, 2024**[94](index=94&type=chunk) [Closure of Register of Members](index=13&type=section&id=Closure%20of%20Register%20of%20Members) The company's share register will be closed from December 13 to December 15, 2023, inclusive, with no share transfers accepted during this period - The company's register of members will be closed from **December 13, 2023 to December 15, 2023**, both days inclusive, during which period no transfer of shares will be registered[95](index=95&type=chunk) - To qualify for the interim dividend, all share transfer documents, together with the relevant share certificates and transfer forms, must be lodged with the company's Hong Kong Share Registrar, Tricor Investor Services Limited, by **4:30 p.m. on December 12, 2023** at the latest[95](index=95&type=chunk) [Property, Plant and Equipment](index=14&type=section&id=Property%2C%20Plant%20and%20Equipment) Property, plant and equipment increased, primarily due to the acquisition of a yacht | Indicator | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Property, Plant and Equipment | 70,810 | 60,868 | +16.3% | - The increase in property, plant and equipment was mainly due to the **addition of a yacht**[67](index=67&type=chunk) [Trade and Other Receivables, Deposits and Prepayments](index=14&type=section&id=Trade%20and%20Other%20Receivables%2C%20Deposits%20and%20Prepayments_Financial%20Review) Trade and other receivables, deposits, and prepayments decreased, mainly due to enhanced receivables control processes | Indicator | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade and Other Receivables, Deposits and Prepayments | 98,274 | 124,032 | -20.8% | - The decrease in trade receivables was mainly due to **enhanced receivables control processes**[121](index=121&type=chunk) [Trade Payables and Retention Monies and Accrued Charges](index=14&type=section&id=Trade%20Payables%20and%20Retention%20Monies%20and%20Accrued%20Charges) Trade payables and retention monies and accrued charges decreased, primarily due to settlement of purchases for M&E systems and payments to subcontractors | Indicator | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Payables and Retention Monies and Accrued Charges | 70,392 | 77,266 | -8.9% | | Trade Payables | 42,540 | 52,924 | -19.6% | - The decrease in trade payables was mainly due to the **settlement of various purchases** of mechanical ventilation and air-conditioning systems and payments to certain subcontractors before the end of the period[122](index=122&type=chunk) [Retention Monies Payable](index=14&type=section&id=Retention%20Monies%20Payable) Retention monies payable increased, mainly due to subcontractors' contributions to the group's ongoing projects | Indicator | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Retention Monies Payable | 13,381 | 13,205 | +1.3% | - The increase in retention monies payable was mainly due to the **contributions from subcontractors** to the group's existing projects[97](index=97&type=chunk) [Future Prospects](index=14&type=section&id=Future%20Prospects) The group is optimistic about future business development, aiming to enhance service capabilities, capitalize on opportunities from Hong Kong's 'Northern Metropolis' development and carbon neutrality goals, and explore new areas in innovative, smart, energy-efficient, and environmentally friendly technologies through partnerships - The group will further enhance its service capabilities and seize business opportunities to **solidify its position** in the M&E engineering industry, actively seeking development opportunities to expand its business scope[123](index=123&type=chunk) - The Hong Kong Government's commitment to increasing land supply for no less than 72,000 residential units over the next five years and the upcoming release of the "Northern Metropolis Action Agenda" are expected to bring **significant business opportunities** to the construction and innovation and technology industries[71](index=71&type=chunk) - The group will strive to integrate energy-saving technologies and renewable energy into M&E systems to improve building energy efficiency, aligning with the government's 2050 carbon neutrality target, and actively seek partners to promote energy-saving and emission reduction initiatives[72](index=72&type=chunk) - The group was awarded **7 new projects** during the period, with a total contract value of approximately HK$232,240,000[123](index=123&type=chunk) [Liquidity and Financial Resources](index=16&type=section&id=Liquidity%20and%20Financial%20Resources) The group's working capital is primarily funded by internal resources and bank borrowings, maintaining a sound financial position with increased pledged bank balances and cash equivalents, a slight decrease in gearing ratio, and growth in capital expenditure [Financial Policy](index=16&type=section&id=Financial%20Policy) The group's working capital is funded by internal resources and bank borrowings, maintaining a sound financial position with sufficient reserves for commitments and expansion - The group's working capital is **funded by internal resources and bank borrowings**[126](index=126&type=chunk) - The group maintains a **sound financial position**, capable of providing ample financial resources for existing commitments, working capital needs, and further business expansion when required[74](index=74&type=chunk) - The group's policy is to regularly monitor current and anticipated liquidity needs to ensure **sufficient cash reserves** are maintained[127](index=127&type=chunk) [Pledged Bank Balances and Cash and Cash Equivalents](index=16&type=section&id=Pledged%20Bank%20Balances%20and%20Cash%20and%20Cash%20Equivalents) Pledged bank balances and cash and cash equivalents increased, attributed to improved cash flow management through enhanced receivables control processes | Indicator | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Pledged Bank Balances and Cash and Cash Equivalents | 96,273 | 74,359 | +29.5% | - The increase was due to **improved cash flow management** through enhanced receivables control processes[127](index=127&type=chunk) - Pledged bank balances and cash and cash equivalents are denominated in Hong Kong Dollars and primarily generated from the group's ordinary operations[74](index=74&type=chunk) [Bank Borrowings](index=16&type=section&id=Bank%20Borrowings_Liquidity) Bank borrowings are secured by group properties and company guarantees, bearing floating interest rates tied to Hong Kong Prime Rate or HIBOR | Repayment Period | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Within one year | 23,248 | 24,538 | | More than one year but not exceeding two years | 1,393 | 1,394 | | More than two years but not exceeding five years | 4,438 | 5,978 | | More than five years | 16,524 | 15,640 | | **Total** | **45,603** | **47,550** | - Bank borrowings are secured by **two parking spaces, an office of the group, and corporate guarantees** provided by the company[128](index=128&type=chunk) - Bank borrowings bear interest at floating annual rates ranging from **Hong Kong Prime Rate minus 2.75% to 2.85%** or **one-month HIBOR plus 1.75%**[105](index=105&type=chunk) [Gearing Ratio](index=17&type=section&id=Gearing%20Ratio) The gearing ratio, calculated as total interest-bearing liabilities divided by total equity, slightly decreased to approximately 14.8% | Indicator | As at September 30, 2023 | As at March 31, 2023 | | :--- | :--- | :--- | | Gearing Ratio | Approx. 14.8% | Approx. 15.2% | - The gearing ratio is calculated as **total interest-bearing liabilities divided by total equity**[106](index=106&type=chunk) [Capital Expenditure](index=17&type=section&id=Capital%20Expenditure) Capital expenditure for the acquisition of property, plant and equipment increased significantly during the period | Item | For the six months ended September 30, 2023 (HK$ thousand) | For the six months ended March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Acquisition of property, plant and equipment | 12,618 | 3,876 | [Capital Commitments](index=18&type=section&id=Capital%20Commitments) As of September 30, 2023, contracted but unprovided capital expenditure for property, plant and equipment significantly decreased to HK$353 thousand | Item | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Contracted but not provided for capital expenditure for acquisition of property, plant and equipment | 353 | 12,353 | [Contingent Liabilities](index=18&type=section&id=Contingent%20Liabilities) Performance bonds increased, issued by banks and secured by pledged bank balances and company guarantees, with no other significant contingent liabilities at period-end | Item | As at September 30, 2023 (HK$ thousand) | As at March 31, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Performance bonds | 94,020 | 79,942 | - Performance bonds are issued by banks under banking facilities and are secured by the group's pledged bank balances and corporate guarantees provided by the company[108](index=108&type=chunk) - As at September 30, 2023, the group had **no other significant contingent liabilities**[134](index=134&type=chunk) [Pledge of Group Assets](index=18&type=section&id=Pledge%20of%20Group%20Assets) The group's assets, including certain vehicles, refundable rental deposits, parking spaces, an office, and pledged bank balances, are used as collateral for lease liabilities and bank financing - The group's assets, including certain vehicles, refundable rental deposits, two parking spaces, an office, and pledged bank balances, are pledged as collateral for the group's lease liabilities and bank financing[109](index=109&type=chunk) [Material Investments](index=18&type=section&id=Material%20Investments) The group had no material investments during the period, beyond what is disclosed in this announcement - Save as disclosed in this announcement, the group had **no material investments** during the period[110](index=110&type=chunk) [Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=18&type=section&id=Material%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%20and%20Joint%20Ventures) The group made no material acquisitions or disposals of subsidiaries, associates, or joint ventures during the period - During the period, the group made **no material acquisitions or disposals** of subsidiaries, associates, and joint ventures[111](index=111&type=chunk) [Future Plans for Material Investments and Capital Assets](index=19&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) The group has no other plans for material investments or capital assets beyond those disclosed in this announcement - As at September 30, 2023, save as disclosed in this announcement, the group had **no other plans for material investments or capital assets**[137](index=137&type=chunk) [Foreign Exchange Risk Management](index=19&type=section&id=Foreign%20Exchange%20Risk%20Management) The group currently has no foreign currency hedging policy as foreign currency risk is considered immaterial, but management will continue to monitor and consider hedging if necessary - The group currently has **no foreign currency hedging policy** as foreign currency risk is considered immaterial[112](index=112&type=chunk) - Management will continue to closely monitor the group's foreign exchange risk and will consider hedging significant foreign exchange risk when necessary[112](index=112&type=chunk) [Events After the Reporting Period](index=19&type=section&id=Events%20After%20the%20Reporting%20Period) No significant events affecting the group have occurred since the end of the reporting period up to the date of this announcement, other than those disclosed - Save as disclosed in this announcement, **no significant events** affecting the group have occurred since the end of the period and up to the date of this announcement[113](index=113&type=chunk) [Employees and Remuneration Policy](index=19&type=section&id=Employees%20and%20Remuneration%20Policy) Both the number of employees and staff costs increased, with the group offering competitive salaries, benefits, training, and performance-based incentives to attract and retain talent | Indicator | As at September 30, 2023 | As at September 30, 2022 | | :--- | :--- | :--- | | Number of Employees | 188 | 182 | | Total Staff Costs | HK$41,963,000 | HK$37,315,000 | - The group provides employees with **competitive salaries and benefits** (with reference to market conditions and individual qualifications and experience) and adequate job training[113](index=113&type=chunk) - In addition to mandatory provident funds and job training programs, employees may also receive salary increments, discretionary bonuses, share options, and share awards based on individual performance evaluations and market conditions[113](index=113&type=chunk) [Share Option Scheme and Share Award Scheme](index=19&type=section&id=Share%20Option%20Scheme%20and%20Share%20Award%20Scheme) The company adopted a share award scheme on September 15, 2023, granting 10,827,000 award shares, with no share options granted under the share option scheme during the period - The company adopted a Share Award Scheme on **September 15, 2023**, to provide incentives to attract, retain, and motivate eligible participants[114](index=114&type=chunk) - As at September 30, 2023, **10,827,000 award shares** were granted under the scheme[114](index=114&type=chunk) - As at September 30, 2023, **no share options were granted** under the Share Option Scheme[140](index=140&type=chunk) [Other Information](index=20&type=section&id=Other%20Information) This section covers corporate governance, compliance, and other relevant disclosures for the period [Corporate Recognition](index=20&type=section&id=Corporate%20Recognition) The group received 'Environmental Excellent Partner' and 'Environmental Pioneer' titles from the Federation of Hong Kong Industries, recognizing its environmental contributions - The group was awarded the titles of "Environmental Excellent Partner" and "Environmental Pioneer" by the Federation of Hong Kong Industries, recognizing the group's contributions to the environment[115](index=115&type=chunk) [Competing Interests](index=20&type=section&id=Competing%20Interests) No directors, controlling shareholders, or their close associates held interests in any business competing or potentially competing with the group during the period - During the period, none of the directors or controlling shareholders of the company or their close associates had any interests in any business that competes or is likely to compete, directly or indirectly, with the group's business[142](index=142&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=20&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) Neither the company nor its subsidiaries purchased, sold, or redeemed any 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 shares[143](index=143&type=chunk) [Sufficiency of Public Float](index=20&type=section&id=Sufficiency%20of%20Public%20Float) The directors confirm that the company maintained a sufficient public float for its shares as required by the Listing Rules throughout the period - The directors confirm that the company has maintained a **sufficient public float** for its shares as required by the Listing Rules throughout the period[144](index=144&type=chunk) [Compliance with the Corporate Governance Code of the Listing Rules](index=20&type=section&id=Compliance%20with%20the%20Corporate%20Governance%20Code%20of%20the%20Listing%20Rules) The company complied with the Corporate Governance Code, except for the combined roles of Chairman and CEO, which the Board believes benefits management and business development, with future consideration for separation - The company has complied with the code provisions of the Corporate Governance Code set out in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited during the period, save for code provision C.2.1, which stipulates that the roles of chairman and chief executive officer should be separate and not performed by the same individual[145](index=145&type=chunk) - The Board believes that Dr. Ko's dual role as Chairman and Chief Executive Officer is **beneficial to the group's management and business development** and will provide strong and consistent leadership to the group[154](index=154&type=chunk) - The Board will continue to review and consider separating the roles of Chairman and Chief Executive Officer at an appropriate and suitable time, taking into account the overall circumstances of the group[154](index=154&type=chunk) [Standard Code for Securities Transactions by Directors of Listed Issuers](index=21&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors%20of%20Listed%20Issuers) The company adopted the Standard Code for directors' securities transactions, and all directors confirmed compliance throughout the period - The company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rules as its code of conduct regarding directors' securities transactions[119](index=119&type=chunk) - The company has made specific enquiries to all directors, and they have all confirmed that they have **complied with the required standards** set out in the Standard Code throughout the period[119](index=119&type=chunk) [Review of Interim Financial Results](index=21&type=section&id=Review%20of%20Interim%20Financial%20Results) The condensed consolidated financial statements for the period were reviewed by Deloitte Touche Tohmatsu, the independent auditor, and discussed with management by the Board's audit committee - The condensed consolidated financial statements for the period have been reviewed by Deloitte Touche Tohmatsu, the company's independent auditor, in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants[147](index=147&type=chunk) - The Board's Audit Committee has discussed with the group's management and reviewed this announcement (including the accounting principles and standards adopted by the group) in conjunction with the group's independent auditor[155](index=155&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=21&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This announcement is published on the company's and HKEX websites, with the 2023 interim report to be dispatched to shareholders and available online in due course - This announcement is published on the company's website (http://www.chittathk.com) and the HKEX website (https://www.hkexnews.hk)[148](index=148&type=chunk) - The company's 2023 Interim Report will be dispatched to the company's shareholders in due course and will be available for inspection on the respective websites of the HKEX and the company[148](index=148&type=chunk) [Acknowledgement](index=22&type=section&id=Acknowledgement) The Board extends sincere gratitude to the group's management, staff, shareholders, business partners, and other professionals for their diligent contributions and support during the period - The Board wishes to express its sincere gratitude to the group's management and all staff for their diligent contributions, and to its shareholders, business partners, and other professionals for their support during the period[157](index=157&type=chunk)

Gender Diversity - Approximately 14.1% of the Group's employees are female, and the Group aims to enhance gender diversity in senior management over the next five years[5] - The Board consists of six Directors, with two females, achieving gender diversity[4] - The Group aims to achieve a gender diversity of 35% female employees within the next five years[187] - The Board has adopted a policy relating to Board diversity and discussed measurable objectives for its implementation[184] - The Group will continue to seek outstanding talent to achieve gender diversity in senior management[191] Corporate Governance - The roles of Chairman and CEO are held by Dr. Ko, who has managed the Group since 2000, providing strong leadership[6] - The Company has complied with all applicable code provisions of the Corporate Governance Code, except for a deviation regarding the separation of the roles of Chairman and CEO[144] - The Company has implemented a Model Code governing securities transactions by Directors, with all Directors confirming compliance throughout the year[144] - The Company has established three Board committees: the Audit Committee, the Remuneration Committee, and the Nomination Committee, each provided with sufficient resources to fulfill their duties[157] - The Company has mechanisms in place to ensure independent views and input are available to the Board during its decision-making processes[147] Board Composition and Meetings - The Board consists of six Directors, with Independent Non-Executive Directors (INEDs) representing 50% of the Board members[124] - The Board comprises six Directors, with three being Independent Non-Executive Directors (INEDs), ensuring a balance of power[143] - The Board held four meetings during the Year, during which the audited consolidated financial statements for the year ended 31 March 2022 were approved[131] - The attendance record for the Directors at meetings shows full attendance for the year[37] - The Board is scheduled to meet quarterly, with agendas and accompanying papers sent to Directors at least three days in advance to facilitate informed decision-making[151] Remuneration Policies - The Remuneration Committee has been established to make recommendations on the remuneration policy and structure for all Directors and senior management[29] - The remuneration policy for employees is determined based on merit, qualifications, and capabilities, considering the Company's performance and market statistics[90] - The total remuneration caps for Connected Employees and Mr. CH Ko have been revised to not exceed HK$4,500,000, HK$5,000,000, and HK$5,500,000 for the years ending March 31, 2023, 2024, and 2025, respectively[108] - The Remuneration Committee held one meeting during the year to discuss executive Directors' remuneration packages, including benefits, pension rights, and compensation payments[134] - The emolument policy for employees is based on merit, qualifications, and competence, as recommended by the Remuneration Committee[117] Audit and Compliance - The Audit Committee comprises two INEDs and one non-executive Director, with its primary roles including monitoring the integrity of the Group's financial statements and discussing risk management and internal control systems with management[157] - The Audit Committee is responsible for reviewing the Company's compliance with legal and regulatory requirements[187] - The Group's independent auditor, Deloitte, has stated its reporting responsibilities on the Group's consolidated financial statements for the year[172] - The Group's corporate governance practices comply with the CG Code, ensuring transparency and accountability[165] - The Company has arranged appropriate directors' and officers' liability insurance coverage for its Directors and officers, which was in force during the Year[88] Stakeholder Engagement - The Group's success relies on support from key stakeholders, including employees, customers, subcontractors, and suppliers[17] - The Company will disclose detailed environmental policies and performance evaluations in its Environmental, Social and Governance Report[24] - The Company will publish its Environmental, Social and Governance Report on its website and the Stock Exchange's website[26] - Charitable donations made by the Group during the Year amounted to HK$1,609,000, a significant increase from HK$255,000 in 2022[120] - The revenue from the Group's five largest customers accounted for 52% of total revenue, with the largest customer contributing 16%[120] Risk Management - The Board considers the Group's risk management and internal control systems to be adequate and effective, with annual reviews planned[173] - The Group expects to conduct an annual review of the effectiveness of the risk management and internal control systems[173] - The Audit Committee is responsible for recommending the appointment and remuneration of the external auditor, ensuring the auditor's independence and effectiveness[157] - The Group has maintained a sufficient public float as required under the Listing Rules throughout the year and up to the date of the report[119] - All related party transactions disclosed are fully exempt from reporting and independent shareholders' approval requirements under Chapter 14A of the Listing Rules[111]

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，概不就因本公告 全部或任何部份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。 ACCEL GROUP HOLDINGS LIMITED 高 陞 集 團 控 股 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1283） 截 至2023年3月31日 止 年 度 之 全 年 業 績 公 告 財務摘要 • 本 集 團 於 截 至2023年3月31日 止 年 度 錄 得 收 益 約538,492,000港 元。（2022 年：約 547,315,000港元） • 本集團於截至2023年3月31日止年度錄得毛利約94,936,000港元及毛利率 17.6%。（2022年：毛利約 107,514,000 港元及毛利率19.6%） • 於 截 至2023年3月31日 止 年 度 的 溢 利 為 約55,899,000港 元。（2022年：約 67,980,000港元） ...

Financial Performance - The company's revenue for the six months ended September 30, 2022, decreased by approximately HKD 67,138,000 or 23.9% to about HKD 213,790,000 compared to approximately HKD 280,928,000 for the same period in 2021[12]. - Gross profit decreased by approximately HKD 11,132,000 or 19.7% to about HKD 45,356,000, while the gross profit margin increased from approximately 20.1% to 21.2%[14]. - The profit attributable to the owners of the company decreased to approximately HKD 30,953,000 from HKD 35,125,000 in the same period last year[17]. - Revenue for the six months ended September 30, 2022, was HKD 213,790,000, a decrease of 24% compared to HKD 280,928,000 for the same period in 2021[78]. - Net profit for the period was HKD 30,914,000, compared to HKD 35,125,000 in the prior year, reflecting a decline of 12%[78]. - Basic earnings per share decreased to HKD 3.9 from HKD 4.4, representing a drop of approximately 11%[78]. - The company reported a profit before tax of HKD 35,794,000, a decrease of 15% from HKD 42,324,000 in the previous year[78]. - The company's operating profit before tax for the six months ended September 30, 2022, was HKD 35,794,000, a decrease of 15.9% compared to HKD 42,324,000 for the same period in 2021[85]. Expenses and Costs - Service costs decreased by approximately HKD 56,006,000 or 25.0% to about HKD 168,434,000, down from approximately HKD 224,440,000 in the previous period[13]. - Administrative expenses increased by approximately HKD 2,128,000 or 17.3% to about HKD 14,410,000, primarily due to an increase in research projects related to blockchain and the metaverse[15]. - The income tax expense decreased by approximately HKD 2,319,000 or 32.2% to about HKD 4,880,000, mainly due to a reduction in taxable profits[16]. - The company’s total employee costs for the six months ended September 30, 2022, were HKD 37,315,000, a decrease from HKD 38,719,000 in the same period of 2021, representing a decline of approximately 3.6%[102]. - The total remuneration for key management personnel was HKD 2,736,000 for the six months ended September 30, 2022, down from HKD 3,358,000 for the same period in 2021, reflecting a decrease of 18%[138]. - The company’s short-term employee benefits for key management were HKD 2,772,000 for the six months ended September 30, 2022, compared to HKD 3,394,000 for the same period in 2021, indicating a decrease of 18%[138]. Assets and Liabilities - Total assets as of September 30, 2022, were HKD 391,677,000, down from HKD 430,033,000 as of March 31, 2022[79]. - Non-current assets increased to HKD 82,053,000 from HKD 13,879,000, indicating significant investment in property and equipment[79]. - The company’s total liabilities included lease liabilities of HKD 5,204,000 as of September 30, 2022, significantly up from HKD 1,065,000 as of March 31, 2022[81]. - The company’s lease liabilities as of September 30, 2022, amounted to HKD 1,075,000, an increase from HKD 55,000 as of March 31, 2022[134]. - The company’s accrued expenses were HKD 9,001,000 as of September 30, 2022, compared to HKD 8,607,000 as of March 31, 2022, representing a rise of 5%[125]. - The company reported a total of HKD 12,973,000 in warranty payables as of September 30, 2022, compared to HKD 12,229,000 as of March 31, 2022, marking an increase of 6%[125]. Dividends and Shareholder Information - The interim dividend declared is HKD 0.016 per share, totaling approximately HKD 12,800,000, down from HKD 0.021 per share or HKD 16,800,000 in the previous period[18]. - The company declared dividends of HKD 16,800,000 during the six months ended September 30, 2022, compared to no dividends declared in the same period of 2021[86]. - As of September 30, 2022, the major shareholders, Lightspeed Limited, hold 600,000,000 shares, representing 75% of the company's equity[56]. - Dr. Gao and Ms. Zhang, the main executives, each have a beneficial interest in 600,000,000 shares of Lightspeed, equating to 75% ownership[56]. Investments and Acquisitions - The company completed the acquisition of Best Investment Development Limited for HKD 61,828,000 on August 31, 2022, which holds several properties at TML Plaza[39]. - The company completed the acquisition of a subsidiary, resulting in a cash outflow of HKD 61,828,000 during the six months ended September 30, 2022[86]. - Capital expenditures for the acquisition of property, plant, and equipment amounted to HKD 56,358,000 and HKD 5,801,000 for investment properties during the period[34]. - During the six months ended September 30, 2022, the company acquired properties, plant, and equipment amounting to HKD 56,358,000 and investment properties of HKD 5,801,000[110]. Research and Development - The company is actively involved in research and development, establishing a joint laboratory focused on the metaverse and human-computer interaction with a local university[10]. - The group has established a joint laboratory with Hong Kong Educational University to promote technology applications in education, which may lead to future business opportunities[51]. Market Opportunities and Strategy - The company aims to capture opportunities arising from macroeconomic changes and adjust its operational strategies to enhance market share[11]. - The Hong Kong government plans to increase land supply for at least 72,000 residential units over the next five years, which is expected to create significant opportunities for the construction industry[51]. - The group aims to enhance its service capabilities and seize business opportunities to strengthen its position in the electromechanical engineering sector[49]. - The group is committed to integrating energy-saving technologies and renewable energy into its systems to align with government low-carbon transformation goals, thereby reducing carbon emissions[52]. Financial Position and Ratios - The current ratio as of September 30, 2022, was approximately 4.70 times, down from approximately 5.99 times on March 31, 2022[27]. - The debt-to-equity ratio as of September 30, 2022, was approximately 7.9%, compared to approximately 4.9% on March 31, 2022[33]. - The company maintained sufficient public float as per listing rules during the reporting period[69]. - The company has no significant foreign currency risk as its monetary assets and liabilities are primarily denominated in Hong Kong dollars[44]. Receivables and Payables - Trade receivables slightly decreased by approximately HKD 47,000 or 0.1% from approximately HKD 59,796,000 on March 31, 2022, to approximately HKD 59,749,000 on September 30, 2022[23]. - The company provided trade credit terms ranging from 7 to 90 days to customers, with overdue receivables of HKD 14,539,000 as of September 30, 2022, which are not considered in default[114]. - The company’s total receivables, after deducting credit loss provisions, stood at HKD 59,749,000 as of September 30, 2022, compared to HKD 59,796,000 as of March 31, 2022[111]. - As of September 30, 2022, trade payables amounted to HKD 21,944,000, a decrease of 5% from HKD 23,103,000 as of March 31, 2022[125]. - The aging analysis of trade payables shows that amounts due within 30 days were HKD 20,594,000, down from HKD 21,905,000, representing a decrease of 6%[126].

Financial Performance - Accel Group Holdings Limited reported a significant increase in revenue for 2022, reaching HK$XXX million, representing a YY% growth compared to the previous year[2]. - The company achieved a net profit of HK$XXX million, which is an increase of ZZ% year-over-year[2]. - Revenue for the year ended 31 March 2022 was HK$547,315,000, an increase of 7.3% compared to HK$508,904,000 for the previous year[18]. - Profit for the year was HK$67,980,000, a decrease of 7.9% from HK$73,303,000 in the prior year[18]. - Profit before taxation for the year was HK$81,709,000, compared to HK$86,462,000 in the previous year[18]. - The Group's revenue increased by approximately HK$38,411,000 or 7.5% from approximately HK$508,904,000 to approximately HK$547,315,000 for the Year[35]. - The Group's gross profit increased by approximately HK$4,912,000 or 4.8% from approximately HK$102,602,000 to approximately HK$107,514,000 for the Year[39]. - The Group's gross profit margin slightly decreased by 0.6% to 19.6% compared to the previous year of 20.2%[40]. Market Expansion and Strategy - For the upcoming fiscal year, Accel Group Holdings Limited provided guidance of expected revenue growth between AA% to BB%[2]. - The company is focusing on expanding its market presence in Asia, targeting a YY% increase in market share by the end of 2023[2]. - The Group aims to enhance its ability to acquire new projects to lay a solid foundation for business development[34]. - The Group plans to leverage its strengths in E&M engineering services to capture business opportunities in the post-pandemic economy and diversify into new areas such as smart technology and environmental protection[67]. Research and Development - The company has invested HK$XXX million in research and development, representing a ZZ% increase from the previous year[2]. - The Group has established a joint laboratory with The Education University of Hong Kong to focus on research in the fields of Metaverse and Human-computer Interaction, aiming to enhance educational quality and create new business opportunities[68]. Sustainability and Corporate Responsibility - Management emphasized the importance of sustainability in its future strategies, aiming for a YY% reduction in carbon footprint by 2025[2]. - The Group is committed to integrating energy-saving and environmental protection technologies into its systems to reduce carbon emissions[28]. - The Group will actively seek partners for energy conservation and emissions reduction initiatives in Hong Kong, contributing to the Greater Bay Area's carbon neutrality efforts[73]. - The Group received the Outstanding Social Caring Organisation Award and the Corporate Environmental Leadership Award in 2021, highlighting its commitment to corporate social responsibility[98]. - The Group has been appointed as a founding member of the GBA Carbon Neutrality Association, recognizing its performance in energy conservation[98]. Corporate Governance - The board of directors highlighted the commitment to enhancing corporate governance practices in line with the latest regulations[2]. - The Group emphasizes corporate governance, with Mr. Cheng responsible for overall governance and financial oversight[139]. - The Group's commitment to independent oversight is reflected in the roles of its Independent Non-Executive Directors, ensuring accountability and transparency[128][133]. Operational Challenges - The Group faced increased operating costs due to inflationary pressures and rising raw material prices[23]. - The business environment was negatively impacted by the COVID-19 pandemic, affecting logistics and shipping industries[23]. - Key risks include reliance on non-recurrent E&M engineering projects, which could impact operations and financial results if new projects are not secured[165]. - The company faces potential cost overruns due to inaccurate estimations of project execution timeframes or costs, which may adversely affect revenue and profitability[165]. Employee and Management Insights - The Group employed 184 employees as of March 31, 2022, an increase from 162 employees in the previous year, with total staff costs of approximately HK$80,342,000 compared to HK$75,739,000 in the prior year[87]. - The Group emphasizes the importance of employees as valuable assets and aims to enhance job satisfaction through competitive remuneration and performance appraisal systems[149]. - The leadership team includes family members, indicating a strong commitment to the company's long-term vision and strategy[120]. Financial Management - The Group's financial management strategy focuses on maintaining a healthy financial position to support business growth through balanced financing sources[74]. - The Group's bank loans as of March 31, 2022, included a loan of HK$206,000,000, down from HK$347,000,000 in 2021, with a floating interest rate based on the Hong Kong best lending rate[65]. - The current ratio of the Group was approximately 5.99 times as of March 31, 2022, compared to approximately 3.88 times as of March 31, 2021[74]. Shareholder Information - The company plans to recommend a final dividend of HK cents 2.1 per Share, totaling approximately HK$16,800,000, down from HK$32,800,000 in the previous year[103]. - Directors' interests include 600,000,000 shares held by Lightspeed, with Dr. Ko owning 70% and Ms. Cheung 30%[183]. - The Share Option Scheme allows for a maximum of 80,000,000 shares to be granted, which is 10% of the issued shares as of the report date[196]. Recognition and Awards - The Group was awarded "Listed Enterprises of the Year 2021" by Bloomberg Businessweek and recognized as one of "Forbes Asia's 200 Best Under A Billion" in 2021[95]. - The Group has been recognized as one of the top 200 outstanding listed SMEs in Asia by Forbes and included in the MSCI Hong Kong Micro Cap Index[98].

Financial Performance - The total profit and comprehensive income for the period was HKD 35,125,000, an increase of 3.6% compared to HKD 33,909,000 for the same period last year, excluding a one-time government subsidy of HKD 4,291,000 [7]. - Revenue increased by approximately HKD 40,919,000 or 17.0% to about HKD 280,928,000, driven by an increase in the number of projects and progress in ongoing projects [8]. - Gross profit increased by approximately HKD 4,418,000 or 8.5% to about HKD 56,488,000, while the gross profit margin decreased from 21.7% to 20.1% due to competitive pricing strategies [11]. - Profit before tax decreased to HKD 42,324,000, down 6.5% from HKD 45,486,000 in the prior year [72]. - Net profit for the period was HKD 35,125,000, a decline of 8.2% compared to HKD 38,200,000 in the previous year [72]. - Basic earnings per share for the period was HKD 4.4, down from HKD 4.8 in the same period last year [72]. - The company's profit before tax for the six months ended September 30, 2021, was HKD 42,324,000, a decrease of 7.4% compared to HKD 45,486,000 for the same period in 2020 [81]. Expenses and Costs - Service costs rose by approximately HKD 36,501,000 or 19.4% to about HKD 224,440,000, consistent with the increase in revenue [10]. - Administrative expenses rose to approximately HKD 12,282,000 from about HKD 11,000,000, primarily due to increased depreciation related to a new office [12]. - Total employee costs increased to HKD 38,719,000, up from HKD 34,235,000, representing an increase of 13.5% [89]. - Interest income decreased significantly to HKD 140,000 from HKD 646,000, reflecting a decline of 78.3% [88]. - The effective tax rate remained stable at 16.5% for both periods, with current tax expenses of HKD 7,520,000 compared to HKD 7,286,000 in the previous year [91]. Dividends - The company declared an interim dividend of HKD 0.021 per share, amounting to approximately HKD 16,800,000, with payment expected on January 11, 2022 [15]. - The company declared a final dividend of HKD 0.041 per share for the year ending March 31, 2021, totaling HKD 32,800,000, an increase from HKD 25,600,000 for the previous period [8]. - The company’s board declared an interim dividend of HKD 0.021 per share for the six months ending September 30, 2021, totaling HKD 16,800,000, compared to no interim dividend in the previous period [8]. Assets and Liabilities - Total assets as of September 30, 2021, were HKD 475,769,000, an increase from HKD 436,502,000 as of March 31, 2021 [74]. - Current liabilities decreased to HKD 134,618,000 from HKD 112,476,000 as of March 31, 2021 [75]. - Non-current liabilities increased to HKD 1,811,000 from HKD 1,410,000 as of March 31, 2021 [75]. - Total equity as of September 30, 2021, was HKD 355,046,000, up from HKD 352,721,000 as of March 31, 2021 [75]. - Trade receivables increased to HKD 75,653,000 as of September 30, 2021, up from HKD 51,347,000 as of March 31, 2021, reflecting a significant rise in outstanding amounts [96]. - Trade payables decreased to HKD 56,079,000 from HKD 69,914,000, indicating a reduction in outstanding liabilities [108]. Operational Strategies - The company aims to maintain a proactive and prudent approach to ensure stable growth in the coming years, supported by new large-scale projects acquired during the period [7]. - The company continues to adapt its operational strategies and pricing to expand its market share amid ongoing economic uncertainties [7]. - The group plans to enhance service capabilities and expand market share through prudent financial management strategies and by actively seeking development opportunities [46]. - The group is committed to integrating energy-saving technologies and renewable energy into its systems to align with government low-carbon transformation goals [48]. - The group aims to explore innovative technologies and smart solutions to develop new business avenues, particularly in the context of post-pandemic opportunities [46]. Employee and Management - As of September 30, 2021, the group employed 177 employees, an increase from 167 employees in the same period of 2020, with total employee costs amounting to approximately HKD 38,719,000 compared to HKD 34,235,000 in the previous year [37]. - The group provides competitive salaries and benefits to employees, with a focus on retaining talent and ensuring smooth internal operations [37]. - Total compensation for key management personnel was HKD 3,394,000 for the six months ended September 30, 2021, compared to HKD 3,043,000 for the same period in 2020 [121]. - Dr. Gao serves as both the Chairman and CEO, a role the board believes is beneficial for management and business development [62]. Governance and Compliance - The company has adopted comprehensive governance and disclosure measures to enhance internal control systems and risk management [61]. - The company confirms compliance with the corporate governance code as per the listing rules during the reporting period [61]. - The board of directors consists of six members, including three independent non-executive directors, ensuring a balance of power within the board [62]. - The beneficial ownership of Lightspeed is divided as 70% by Dr. Gao and 30% by Ms. Zhang, indicating a strong control over the company [55]. Market and Future Outlook - The company has successfully secured multiple large-scale electromechanical engineering projects, which are expected to contribute to stable growth in the future [7]. - The group is optimistic about future business development prospects, supported by government initiatives to increase housing land and promote innovation [46]. - The company has no significant foreign currency risk as its monetary assets and liabilities are primarily denominated in HKD [35].

Financial Performance - The company reported a financial summary indicating a significant increase in revenue, with a year-over-year growth of 25%[8] - The revenue for the year was HK$508.9 million, approximately the same as last year, while profit for the year increased to HK$73.3 million[22] - The Group's revenue for the year was approximately HK$508.9 million, a decrease of about HK$13.4 million or 2.6% compared to approximately HK$522.3 million in the previous year[36] - The Group's profit for the year increased to approximately HK$73.3 million, compared to the previous year's profit[24] - The Group's gross profit decreased by approximately HK$13.6 million or 11.7% to approximately HK$102.6 million for the year[43] - The gross profit margin decreased by 2% to 20.2% for the year, down from 22.2% in the previous year[44] - Profit before taxation was HK$86.5 million, compared to HK$88.3 million in the previous year[15] User Growth and Market Expansion - User data showed an increase in active users by 15%, reaching a total of 1.2 million users by the end of the fiscal year[8] - Market expansion efforts include entering two new regions, which are expected to contribute an additional 10% to overall revenue[8] - New product launches are scheduled for Q1 2022, with expectations to capture a 15% market share in the new segment[8] Future Outlook - The future outlook includes a projected revenue growth of 20% for the next fiscal year, driven by new product launches and market expansion strategies[8] - The management has provided guidance for the next quarter, forecasting an EBITDA margin improvement of 3%[8] Research and Development - The company is investing in R&D with a budget increase of 30%, focusing on innovative technologies and product enhancements[8] - The Group is establishing a "Joint Research and Development Laboratory" with local universities to enhance innovation and technology applications[76] Sustainability Initiatives - A commitment to sustainability initiatives has been made, with a target to reduce carbon emissions by 40% over the next five years[8] - The Group is committed to incorporating energy-saving technologies and renewable energy into its E&M systems to reduce carbon emissions[28] - The Group plans to actively seek partners to promote energy conservation and emissions reduction initiatives in Hong Kong[29] Financial Position and Assets - Current assets increased to HK$436.5 million from HK$304.0 million in the previous year[17] - Total equity attributable to equity shareholders of the company reached HK$352.7 million, up from HK$305.0 million in the previous year[17] - Pledged bank balances and cash increased by approximately HK$64,267,000 or 35.8% from approximately HK$179,593,000 to approximately HK$243,860,000, indicating a strong financial position[56] Project Acquisition and Contracts - The company secured several large-scale E&M engineering services projects during and after the year, with a total contract sum of approximately HK$352.7 million for 9 projects[23] - The Group secured nine projects with a total contract value of approximately HK$352.7 million after the year-end[25] - The company engaged in active negotiations for five projects with a total contract sum exceeding HK$500 million[23] Administrative and Operational Expenses - Administrative expenses increased from approximately HK$22.1 million to approximately HK$25.1 million, primarily due to higher staff costs and office expenses[45] - The total staff costs for the year were approximately HK$75,739,000, up from approximately HK$69,268,000 in the previous year, with the Group employing 162 employees as of March 31, 2021[108] Awards and Recognition - The company has been recognized as one of "Forbes Asia's 200 Best Under A Billion" and selected as a constituent stock of the MSCI Hong Kong Micro Cap Index[22] - The Group received multiple awards for outstanding performance in the E&M industry during the year[22] - The Group received several awards, including recognition as one of "Forbes Asia's 200 Best Under A Billion" and the Asia's Most Prominent Engineering (E&M) Company Award 2020[109] Dividend Recommendations - The Board recommended a final dividend of HK cents 4.1 per share, slightly higher than the HK cents 3.2 per share paid in the same period last year[22] - The final dividend recommended by the Board is HK cents 4.1 per share, totaling approximately HK$32,800,000, an increase from HK$25,600,000 in the previous year[117] Governance and Management - The company has received annual confirmations of independence from all Independent Non-Executive Directors (INEDs) as required by the Listing Rules[186] - The non-executive Director has a service contract with an initial term of 3 years, starting from September 18, 2019[187] - The company considers all INEDs to continue to be independent based on the confirmations received[186]

Revenue and Profitability - Revenue for the six months ended September 30, 2020, decreased by approximately HKD 21,280,000 or 8.1% to about HKD 240,009,000 compared to approximately HKD 261,289,000 for the same period in 2019[8]. - Gross profit fell by approximately HKD 14,381,000 or 21.6% to about HKD 52,070,000, with the gross profit margin decreasing from approximately 25.4% to 21.7%[11]. - Profit attributable to equity shareholders decreased to approximately HKD 38,200,000 from HKD 42,272,000 in the same period last year, mainly due to the decline in revenue[14]. - The net profit for the period was HKD 38,200,000, compared to HKD 42,272,000 in the previous year, reflecting a decline of 9.8%[70]. - Basic earnings per share decreased to HKD 4.8 from HKD 7.0, representing a drop of 31.4%[70]. Expenses and Costs - Service costs decreased by approximately HKD 6,899,000 or 3.5% to about HKD 187,939,000 from approximately HKD 194,838,000 in the previous period[10]. - Administrative expenses increased to approximately HKD 11,000,000 from about HKD 7,598,000, primarily due to increased employee costs and professional fees related to the company's successful listing[12]. - Total employee costs, including directors' remuneration, amounted to 34,235 thousand HKD for the six months ended September 30, 2020, up from 31,057 thousand HKD in the previous year, indicating an increase of approximately 7%[93]. - Interest expenses for bank loans decreased to 7 thousand HKD in the six months ended September 30, 2020, from 18 thousand HKD in the same period of 2019, showing a reduction of approximately 61%[92]. - Depreciation of property, plant, and equipment increased to 377 thousand HKD for the six months ended September 30, 2020, compared to 237 thousand HKD in the previous year, representing a rise of approximately 59%[93]. Financial Position - Trade and other receivables decreased by approximately HK$14,040,000 or 20.6% from HK$68,071,000 on March 31, 2020, to HK$54,031,000 on September 30, 2020[17]. - Trade receivables (net of impairment losses) decreased by approximately HK$9,933,000 or 23.8% from HK$41,730,000 on March 31, 2020, to HK$31,797,000 on September 30, 2020[17]. - The current ratio (current assets divided by current liabilities) was approximately 3.76 times on September 30, 2020, compared to 4.98 times on March 31, 2020[23]. - The debt-to-equity ratio was approximately 1.7% on September 30, 2020, up from 1.1% on March 31, 2020[25]. - Total assets as of September 30, 2020, were HKD 359,663,000, an increase from HKD 304,028,000 as of March 31, 2020[71]. Business Strategy and Development - The company is focusing on the private residential mechanical ventilation and air conditioning systems sector, leveraging its competitive advantages in this area[7]. - The company established an intelligent innovation and technology team to support new economic developments in the post-pandemic era[7]. - The company is actively expanding its business in the innovative technology sector[7]. - The company plans to establish a "Research and Development Joint Laboratory" with local universities to enhance technology applications in air quality improvement and energy efficiency[42]. - The company aims to expand its market share through prudent financial management and actively seeks development opportunities in the electromechanical engineering sector[40]. Shareholder and Governance Information - The company has decided not to declare an interim dividend for the period[15]. - The company declared a final dividend of 3.2 HKD cents per share for the year ended March 31, 2020, totaling 25,600,000 HKD, whereas no interim dividend was proposed for the current period[97][98]. - As of September 30, 2020, major shareholders include Mr. Gao and Ms. Zhang, each holding 75% of the shares through Lightspeed Limited, which owns 600,000,000 shares[49]. - The board confirms that the company has maintained sufficient public float as required by the listing rules during the reporting period[55]. - The company has complied with the corporate governance code, with the exception of the roles of Chairman and CEO being held by the same individual, which the board believes provides strong and consistent leadership[57]. Compliance and Audit - The independent auditor has reviewed the interim financial statements, confirming no significant issues were found that would indicate non-compliance with Hong Kong Accounting Standards[67]. - The company has applied revised Hong Kong Financial Reporting Standards, which did not have a significant impact on the financial statements for the current period[84]. Capital and Financing - The group's bank loans amounted to approximately HK$415,000 on September 30, 2020, down from approximately HK$483,000 on March 31, 2020[19]. - The company has utilized HKD 69,930,000 of the net proceeds, leaving HKD 7,577,000 unutilized as of September 30, 2020[39]. - The floating annual interest rate for bank loans was 2.0% as of September 30, 2020, compared to 2% as of March 31, 2020, both rates being below the relevant bank's reported Hong Kong best lending rate[120]. - The company’s capitalized issuance amounted to HKD 599,999,800, which was allocated to the capital account following a share premium[124]. Awards and Recognition - The group was recognized with the 2020 Asia Outstanding Engineering (Electromechanical) Company Award, highlighting its performance in the electromechanical industry[36].

Company Overview - Accel Group Holdings Limited is incorporated in the Cayman Islands and listed on the Stock Exchange with stock code 1283[1]. Financial Performance - The company reported a financial summary indicating significant growth in revenue, with a year-on-year increase of 15%[2]. - The Group's revenue for the year increased by approximately 67.0% to HK$522,332,000 compared to HK$312,732,000 in the previous year[16]. - Profit for the year rose by approximately 60.1% to HK$72,655,000, up from HK$45,395,000 in the corresponding year[16]. - Basic earnings per share increased by approximately 39.0% compared to the previous year[19]. - The Group's profit for the Year increased by approximately 60.1% and basic earnings per share grew by approximately 39.0%[23]. - The Group's gross profit increased by approximately HK$35.2 million or 43.4% from approximately HK$81.0 million for the Corresponding Year to approximately HK$116.2 million for the Year[42]. - The Group's cost of services increased by approximately HK$174.4 million or 75.3% to approximately HK$406.1 million for the Year, in line with the revenue increase[38]. Future Outlook - Future outlook suggests a projected revenue growth of 10% for the next fiscal year, driven by new product launches and market expansion strategies[4]. - Market expansion efforts include entering two new regions, which are expected to contribute an additional 8% to overall revenue[6]. - A new product line is set to launch in Q3 2021, anticipated to generate $30 million in revenue within the first year[8]. Investments and R&D - The company is investing in research and development for new technologies, allocating approximately 5% of total revenue towards innovation[5]. - The Group plans to actively seek new business opportunities to enhance shareholder returns[21]. - The Group aims to strengthen its market position in the Hong Kong E&M engineering services market through improved project management and cost control[21]. Operational Efficiency - The company has implemented new strategies to improve operational efficiency, aiming for a 12% reduction in costs by the end of the fiscal year[9]. - The Group's project management capabilities and long-term customer relationships contributed to obtaining several large-scale E&M engineering projects during the Year[30]. Human Resources - The Group plans to strengthen its human resources and focus on training to enhance project management capabilities[72]. - The Group's human resource management aims to reward and recognize performing staff through competitive remuneration and performance appraisal systems[144]. - The Group actively promotes career development and progression for employees through appropriate training and opportunities[149]. Corporate Governance - The company has a strong leadership team with members holding various significant positions in other organizations, enhancing its strategic planning capabilities[115][116][120]. - The company has a strong focus on corporate governance, with independent directors serving on key committees like the Remuneration and Nomination Committees[135]. - The financial expertise of the board members is expected to contribute positively to the company's financial management and governance[125][127]. Connected Transactions - Connected transactions included subcontracting services provided by Yuk Shing to Chit Tat for painting and IT maintenance services[182]. - Mibuka supplied electrical control equipment to Chit Tat for E&M engineering works, constituting a connected transaction[184]. - The company confirmed compliance with disclosure requirements under Chapter 14A of the Listing Rules for continuing connected transactions[192]. Risk Management - The company is focused on controlling risks and uncertainties to address stakeholder concerns[159]. - The company may face liquidity issues if trade receivables and contract assets are not collected in full and on time[159]. - The company has a reliance on major customers, which poses a risk to revenue stability[159]. Shareholder Information - The Group has recommended a final dividend of HK3.2 cents per share for the year, amounting to approximately HK$25,600,000, compared to HK$0 in 2019[141]. - Lightspeed Limited holds 600,000,000 shares, with Mr. Ko owning 70% and Ms. Cheung owning 30%[167]. - The company holds a significant corporate interest of 600,000,000 shares, representing 75% of the total shareholding[163].

Revenue and Profitability - The group's revenue increased by approximately HKD 111,406,000 or 74.3% to about HKD 261,289,000 for the six months ended September 30, 2019, compared to HKD 149,883,000 for the same period in 2018[10]. - Revenue from mechanical ventilation and air conditioning systems rose by approximately HKD 95,164,000 or 70.1% to about HKD 230,954,000, driven by accelerated construction progress on several residential projects[13]. - Revenue from electrical systems increased by approximately HKD 10,700,000 or 86.5% to about HKD 23,063,000, primarily due to faster project progress in residential developments[12]. - The group's gross profit rose by approximately HKD 28,199,000 or 73.7% to about HKD 66,451,000, maintaining a gross margin of approximately 25.4%[16][17]. - The profit attributable to equity shareholders increased to approximately HKD 42,272,000 from about HKD 24,381,000, primarily due to the increase in revenue[20]. - Net profit for the period was HKD 42,272 thousand, a rise of 73.2% compared to HKD 24,381 thousand in 2018[75]. - Basic earnings per share increased to HKD 7.0, up from HKD 4.1, reflecting a growth of 70.7%[75]. - Profit before tax increased to HKD 51,862 thousand, representing a growth of 75.9% from HKD 29,492 thousand in the previous year[75]. Expenses and Costs - Total service costs increased by approximately HKD 83,207,000 or 74.5% to about HKD 194,838,000, consistent with the revenue increase due to accelerated project progress[15]. - Administrative expenses increased to approximately HKD 7,598,000 from about HKD 6,483,000, mainly due to increased charitable donations[18]. - Employee costs totaled approximately HKD 29,524,000 for the period, up from HKD 26,665,000 in the same period last year[39]. - The income tax expense for the six months ended September 30, 2019, was HKD 9,590,000, compared to HKD 5,111,000 for the same period in 2018, reflecting an increase of 87.5%[105]. - The total employee costs for the six months ended September 30, 2019, amounted to HKD 29,524,000, compared to HKD 26,665,000 for the same period in 2018, indicating an increase of 10.9%[103]. Financial Position - Trade and other receivables increased by approximately HKD 36,389,000 or 103.3% from HKD 35,211,000 on March 31, 2019, to approximately HKD 71,600,000 on September 30, 2019[23]. - Trade receivables rose by approximately HKD 29,598,000 or 100.6% from HKD 29,418,000 to approximately HKD 59,016,000 during the same period[23]. - Total assets as of September 30, 2019, were HKD 212,130 thousand, compared to HKD 137,903 thousand as of March 31, 2019, indicating a growth of 54.0%[78]. - Current liabilities increased to HKD 75,595 thousand from HKD 43,217 thousand, representing a rise of 75.0%[78]. - The current ratio as of September 30, 2019, was approximately 2.81 times, down from 3.19 times on March 31, 2019[30]. - The debt-to-equity ratio was approximately 7.6% as of September 30, 2019, compared to 3.3% on March 31, 2019[32]. Share Capital and Dividends - The board has resolved not to declare an interim dividend for the period, consistent with the previous year[21]. - The company increased its authorized share capital from HKD 380,000 to HKD 100,000,000 by issuing an additional 9,962,000,000 shares on September 18, 2019[127]. - The company issued 200,000,000 ordinary shares at a price of HKD 0.73 each on October 18, 2019, as part of a public offering[140]. - The company recorded a capital contribution of HKD 5,999,998 from the share premium account to the capital account on October 18, 2019[140]. Corporate Governance and Compliance - The board is committed to maintaining high corporate governance standards to enhance operational efficiency and shareholder returns[64]. - The company is subject to the Securities and Futures Ordinance and has complied with the necessary disclosure requirements[48]. - The audit committee has reviewed the interim financial performance and ensured the effectiveness of internal controls and risk management systems[67]. - The interim financial report has been reviewed by an independent auditor, confirming compliance with relevant accounting standards[69]. - The company has adopted a standard code for director securities trading and confirmed compliance from the listing date to the report date[66]. Future Plans and Developments - The company plans to expand its service capabilities and enhance its project management team to improve project design, management, and safety[27]. - The company plans to allocate funds for purchasing performance bonds, procurement costs for mechanical ventilation and air conditioning, hiring additional staff, and general working capital[47]. - The completion timeline for the use of proceeds will depend on the company's future business development[44]. Related Party Transactions - The company’s total revenue from related party transactions for the six months ended September 30, 2019, was HKD 8,047,000, compared to HKD 5,066,000 in 2018[134]. - The company’s employee costs included HKD 1,552,000 for related parties as of September 30, 2019, compared to HKD 1,324,000 for the same period in 2018[137]. Credit and Receivables Management - The company provided a credit period of 7 to 90 days to customers, with regular reviews of the recoverability of existing customers[112]. - The company assesses potential customers' credit quality before accepting them, ensuring a controlled credit limit[112]. - The expected credit loss on financial assets was deemed not significant, with no provisions made for expected credit losses as of the reporting dates[119].