Economic Performance - China's GDP for the first half of 2022 was RMB 56.3 trillion, representing a 2.5% increase year-over-year[14]. - The quarterly GDP growth rate dropped from 4.8% in Q1 to 0.4% in Q2 2022 due to the impact of the Omicron variant[14]. - The national economy began to stabilize and rebound in June 2022 after effective pandemic control measures[14]. - China's GDP for the first half of 2022 was RMB56.3 trillion, an increase of 2.5% year-on-year, despite challenges from the COVID-19 pandemic[36]. Environmental Protection Initiatives - The environmental protection industry in China saw a 10.7% increase in investment for water conservation and public facilities management in the first half of 2022 compared to the same period last year[15]. - The government aims to add 20 million m³/day of wastewater treatment capacity by 2025, with a target of over 95% wastewater treatment rate in counties[18]. - The sewage resource utilization rate for cities facing water shortages is targeted to exceed 25%[18]. - The Group's focus on domestic water pollution treatment aligns with the government's "improvement in quality and efficiency" policy for wastewater treatment facilities[18]. - The Group aims to achieve a sewage treatment rate of over 95% in counties and a sewage resource utilization rate of over 25% in water-scarce cities by 2025[39]. - The overall demand for water pollution treatment in China is expected to grow, driving the development of the environmental protection industry[39]. Business Development and Strategy - The Group is actively developing two overseas projects: a biofuel pellet business in Jambi, Indonesia, and a power supply project in Bangka, Indonesia[19]. - The biofuel pellet business began production in 2021, generating revenue and diversifying the environmental protection business model[19]. - The Group will continue to optimize its business development strategy in response to national policies and market changes[18]. - The Group is actively seeking opportunities to cooperate with other power generation plants and companies to expand its environmental protection business[23]. - The Group will continue to explore potential projects related to the environmental industry chain by restructuring resources through the disposal[30]. - The Group is committed to maintaining a strong foundation in the wastewater treatment business in China while seeking global opportunities in the environmental protection industry[49]. Financial Performance - For the six months ended June 30, 2022, ELL Environmental recorded a revenue of HK$88.1 million, representing a period-on-period increase of 166.9%[29]. - The gross profit for the same period was HK$21.4 million, reflecting a period-on-period increase of 23.8%[29]. - The net loss for the period was HK$1.0 million[29]. - Total revenue increased by HK$55.1 million or 166.9% to HK$88.1 million for the Period from HK$33.0 million for the Last Corresponding Period[53]. - Total cost of sales increased by HK$51.0 million or 323.9% to HK$66.7 million for the Period from HK$15.7 million for the Last Corresponding Period[54]. - Gross profit increased by HK$4.1 million or 23.8% to HK$21.4 million for the Period from HK$17.3 million for the Last Corresponding Period[55]. - Profit before tax increased by HK$3.3 million or 199.4% to HK$5.0 million for the Period from HK$1.7 million for the Last Corresponding Period[65]. - Loss attributable to owners of the Company decreased by HK$1.7 million or 50.7% to HK$1.6 million for the Period from HK$3.3 million for the Last Corresponding Period[67]. Cash Flow and Liquidity - As of June 30, 2022, the carrying amount of the Group's bank balances and cash was HK$21.4 million, representing a decrease of 67.1% compared to HK$65.1 million as of December 31, 2021[75]. - The Group maintained a healthy liquidity position throughout the period, with surplus cash invested appropriately[85][89]. - For the six months ended June 30, 2022, the company reported a net cash used in operating activities of HK$61,706,000, compared to HK$11,115,000 in the same period of 2021, indicating a significant increase in cash outflow[155]. - Cash and cash equivalents at the end of the period decreased to HK$40,083,000 from HK$84,606,000 at the beginning of the period, reflecting a net decrease of HK$22,968,000[158]. Shareholding and Corporate Governance - As of June 30, 2022, Mr. Chan Kwan holds 353,200,000 shares, representing approximately 31.90% of the company's shareholding[116]. - As of June 30, 2022, Mr. Chau On Ta Yuen holds 225,000,000 shares, representing approximately 20.32% of the company's shareholding[116]. - Everbest Environmental Investment Limited holds 337,500,000 shares, accounting for approximately 30.48% of the company's shareholding[125]. - The total shareholding interest of Ms. Wong, including her interests in controlled corporations, amounts to 371,080,000 shares, or approximately 33.51%[125]. - The company has adopted a stock option plan effective from September 26, 2014, with no options granted, exercised, canceled, or lapsed during the period[112]. - The company maintains compliance with the Corporate Governance Code throughout the reporting period[128]. - All directors confirmed compliance with the Model Code governing securities transactions during the reporting period[129]. - The company has a high standard of corporate governance and has complied with all applicable code provisions[128]. Employment and Operational Metrics - The Group had 177 employees as of June 30, 2022, an increase from 122 employees as of December 31, 2021[95][99]. - Employee costs, including Directors' emoluments, were approximately HK$6.9 million for the period, compared to HK$6.8 million for the same period in 2021[95][99].

Economic Performance - In 2021, China's GDP reached RMB 114.4 trillion, marking an 8.1% increase compared to the previous year[18]. - The quarterly GDP growth rate dropped from 18.3% in Q1 to 4.0% in Q4 of 2021, indicating a significant slowdown in economic activity[18]. - The overall economic recovery in the first half of 2021 was marked by a 12.7% increase in GDP compared to the same period in 2020[18]. - Major economic indicators showed weak trends in the latter half of 2021, reflecting the impact of the pandemic on production and economic activities[18]. - The emergence of the Delta variant in the second half of 2021 posed challenges to economic development, further exacerbated by the Omicron variant at the end of the year[18]. Environmental Initiatives - The Chinese government is expected to strengthen policies on energy conservation, emission reduction, and environmental protection during the "14th Five-Year Plan" period[19]. - By 2025, the utilization rate of reclaimed water in water-scarce cities in China is targeted to reach 25%, indicating a growing demand for water pollution treatment[23]. - The Chinese government has emphasized ecological conservation and set higher goals for sewage treatment capabilities in the "14th Five-Year Plan"[45]. - The company aims to leverage the growing domestic environmental protection industry as part of its strategic initiatives[19]. - The company is positioned to benefit from the government's investment in environmental infrastructure and services[19]. Financial Performance - ELL Environmental recorded a revenue of HK$103.1 million, representing a year-on-year increase of 74.8%[34]. - The gross profit for the year was HK$53.6 million, reflecting an 81.1% year-on-year increase[34]. - Net profit reached HK$11.5 million, driven by increased revenue from wastewater treatment and construction projects[34]. - Total revenue increased by HK$44.1 million or 74.8% to HK$103.1 million for the year compared to HK$59.0 million for FY2020, driven by increased water tariffs and construction revenue from the Bangka Project[59][61]. - Profit before tax rose by HK$17.8 million or 349.4% from HK$5.1 million in FY2020 to HK$22.9 million in FY2021[74]. Operational Developments - The Bangka Plant project in Indonesia is expected to commence operation in 2023, enhancing the Group's power generation capabilities[27]. - The biofuel pellet business in Indonesia is expected to officially commence operation in 2022, generating revenue in mid to late 2022[54][56]. - The Group's wastewater treatment business is expected to maintain satisfactory growth due to strong demand in mainland China[35]. - The company plans to expand the scale of its water facilities and enhance daily capacity to improve financial performance[48]. - The Group aims to improve capital efficiency by controlling capital expenditure and optimizing operational processes[29]. Sustainability and ESG Practices - The company is committed to integrating sustainability practices into daily operations and aligning sustainability goals with strategic direction[155]. - The dedicated ESG team oversees the implementation of sustainability strategies and monitors performance against corporate goals[154]. - A materiality assessment is conducted annually with the help of an independent sustainability consultant to identify significant environmental, social, and governance issues for the Group[166]. - The Group has established a dedicated team to manage ESG issues across its business sectors, focusing on the implementation of sustainable development strategies and monitoring performance indicators[157]. - The Group's sustainability performance indicators are disclosed quantitatively where appropriate, allowing for evaluation of the effectiveness of ESG policies[161]. Compliance and Risk Management - The company reported no material non-compliance with relevant laws and regulations during the reporting period, ensuring adherence to environmental performance standards[185]. - The Group has implemented a risk management and internal control mechanism to monitor ESG-related risks and regularly reviews these mechanisms[156]. - The Group engages with key stakeholders, including contractors, shareholders, government authorities, and NGOs, to gather feedback on its operations and sustainable development performance[162]. - The Group's ESG report is prepared based on principles of materiality, balance, consistency, and quantitative measures to ensure meaningful comparisons over time[161]. - The Group identified 27 ESG issues of concern based on stakeholder communication, listing requirements, and industry sustainability trends[168]. Community Engagement and Employee Welfare - ELL Environmental encourages employee participation in voluntary activities, contributing positively to the community[184]. - The company prioritizes occupational health and safety, aiming to build a harmonious and safe working environment for its employees[183]. - Employees are required to turn off electrical appliances when leaving to further reduce energy usage[192]. - The company promotes the concept of "green office" by encouraging electronic communication and double-sided printing to minimize paper usage[194]. - The Group has adopted a share option scheme to provide incentives and rewards to eligible directors and employees[107].

Economic Performance - For the first half of 2021, China's GDP was RMB 53.2 trillion, reflecting a 12.7% increase compared to the same period last year[18]. - As of the end of the first half of 2021, China's GDP reached RMB53.2 trillion, representing a 12.7% increase compared to the same period last year[43]. Water Quality and Environmental Initiatives - The proportion of national surface water assessment sections with excellent water quality (Grade I-III) was 81.8%, an increase of 1.0% year-on-year[18]. - The Ministry of Ecology and Environment reported an increase in excellent water quality sections in major river basins, reaching 83.5%[18]. - The proportion of national surface water assessment sections with excellent water quality (Grade I-III) reached 81.8%, an increase of 1.0% over the same period last year[47]. - The Chinese government has implemented effective measures for air, water, and soil pollution control, yielding positive outcomes[18]. - The Group is committed to contributing to environmental protection through alignment with national water pollution treatment efforts[23]. - The Guidance on Promoting Wastewater Resource Utilisation was published by ten departments, emphasizing systematic development in sewage resource utilization[23]. - The Group aims to achieve a reclaimed water utilization rate of 25% or above in cities facing water shortages by 2025, and 35% in the Beijing-Tianjin-Hebei region[23]. - The Group aims to achieve a centralized collection rate of urban domestic sewage of over 70% and a complete urban domestic sewage collection pipe network by 2035[49]. - The Chinese government has set ambitious goals for wastewater treatment and resource utilization, including a target of over 95% wastewater treatment rate in county-level cities by 2025[41]. Financial Performance - For the six months ended June 30, 2021, ELL Environmental recorded revenue of approximately HK$33.0 million, representing a year-on-year increase of 25.2%[30]. - The gross profit for the same period was HK$17.3 million, reflecting a year-on-year increase of 25.8%[30]. - The net loss for the period was HK$1.9 million[30]. - Total revenue increased by HK$6.6 million or 25.2% to HK$33.0 million for the Period from HK$26.4 million for the Last Corresponding Period[59]. - Revenue excluding imputed interest income increased by HK$6.3 million or 32.8% to HK$25.5 million for the Period from HK$19.2 million for the Last Corresponding Period[61]. - Gross profit increased by HK$3.5 million or 25.8% to HK$17.3 million for the Period from HK$13.7 million for the Last Corresponding Period[65]. - Gross profit margin slightly increased to 52.3% for the Period from 52.1% for the Last Corresponding Period[65]. - Profit before tax increased by HK$1.4 million or 482.5% to HK$1.7 million for the Period from HK$0.3 million for the Last Corresponding Period[76]. - Loss attributable to owners of the Company decreased by HK$1.6 million or 32.3% to HK$3.3 million for the Period from HK$4.8 million for the Last Corresponding Period[78]. - Total cost of sales increased by HK$3.1 million or 24.5% to HK$15.7 million for the Period from HK$12.6 million for the Last Corresponding Period[64]. Operational Developments - The Group's wastewater treatment business has seen a water tariff increase from RMB2.67 per tonne to RMB3.43 per tonne effective from April 2021, expected to enhance revenue and gross profit[29]. - The Group is focusing on two overseas projects: biofuel pellet business in Jambi, Indonesia, and a power supply project in Bangka, Indonesia, with operations expected to commence after the completion of the power supply plant in late 2021[24]. - The Group has purchased a turbine generator and a boiler to improve the efficiency of the power supply plant, enhancing value in its power generation business[24]. - The Group plans to explore cooperation opportunities with other power generation plants to diversify its environmental protection business[28]. - The Group anticipates a satisfactory growth in its mainland China business due to the ongoing strong demand for wastewater treatment[35]. - The management will continue to align with national policies to ensure sustainable growth in the Group's domestic operations[35]. - The Group plans to actively coordinate with national policies and seize development opportunities both domestically and internationally[58]. - The Group is committed to sustainable development and aims to contribute to environmental protection while expanding its wastewater treatment market presence[58]. Corporate Governance and Compliance - The company has complied with all applicable code provisions of the Corporate Governance Code throughout the reporting period[149]. - All directors confirmed compliance with the Model Code governing securities transactions during the reporting period[150]. - The company maintains a high standard of corporate governance as per the principles set out in the Corporate Governance Code[149]. - The company has established an audit committee to enhance financial reporting and internal controls, comprising three independent non-executive directors[159]. Shareholder Information - As of June 30, 2021, Mr. Chau held 225,000,000 shares, representing approximately 20.32% of the company's shareholding[134]. - Mr. Chan held 353,200,000 shares, accounting for approximately 31.90% of the company's shareholding[134]. - Everbest Environmental held 337,500,000 shares, which is about 30.48% of the total shares[145]. - Wealthy Sea Holdings Limited owned 225,000,000 shares, equivalent to 20.32% of the company's shareholding[145]. - Morgan Top Trading Co., Ltd. had a beneficial interest in 143,300,000 shares, representing 12.94% of the company's shareholding[145]. - Ms. Wong held 18,915,000 shares, contributing to a total of 365,080,000 shares or approximately 32.97% when including interests in controlled corporations[145]. - As of June 30, 2021, no other directors or the chief executive had interests or short positions in shares or debentures of the company or its associated corporations[137]. Cash Flow and Liquidity - As of June 30, 2021, the company's bank balances and cash amounted to HK$84.6 million, an increase of 65.7% from HK$51.1 million as of December 31, 2020[84]. - The company maintained a healthy liquidity position throughout the period, with no unutilized banking facilities[98]. - The net cash flows used in operating activities amounted to HK$11,115,000, an increase from HK$7,446,000 in the previous year[182]. - The company generated net cash flows from investing activities of HK$10,955,000, compared to a cash outflow of HK$4,272,000 in the prior year[182]. - The net cash flows from financing activities were HK$28,978,000, a significant increase from a cash outflow of HK$10,934,000 in the same period last year[182]. - Cash and cash equivalents at the end of the period increased to HK$84,606,000, up from HK$39,894,000 at the end of June 2020[185]. Financial Position - As of June 30, 2021, total assets less current liabilities amounted to HK$435,023,000, an increase from HK$431,720,000 as of December 31, 2020[171]. - Current assets increased to HK$135,533,000 from HK$98,682,000, reflecting a growth of approximately 37.3%[171]. - The company reported a net current asset value of HK$59,593,000, up from HK$53,021,000, indicating a rise of about 12.3%[171]. - Total equity as of June 30, 2021, was HK$378,699,000, compared to HK$375,164,000 at the end of 2020, showing a slight increase of 0.7%[173]. - The company’s borrowings decreased significantly from HK$20,240,000 in December 2020 to HK$35,107,000 by June 2021[173]. - Receivables under service concession arrangements rose to HK$28,502,000, up 30.2% from HK$21,883,000 in the previous period[171]. - Inventories increased to HK$1,109,000 from HK$964,000, reflecting a growth of 15.1%[171]. Dividend Information - The Board declared an interim dividend of HK$0.5 cents per ordinary share for the period, compared to no dividend for the six months ended June 30, 2020[120]. - The interim dividend will be payable on or around September 29, 2021, to shareholders registered by September 15, 2021[124]. - The company paid dividends of HK$798,000 during the period, a decrease from HK$7,186,000 in the previous year[182].

Economic Performance - China's GDP for the first three quarters of 2020 was RMB 72.3 trillion, representing a 0.7% growth compared to the previous year[13]. - For the year ended December 31, 2020, ELL Environmental recorded a revenue of HK$59.0 million, representing a year-on-year decrease of 23.8%[25]. - Total revenue decreased by HK$18.5 million or 23.8% to HK$59.0 million for FY2020 compared to HK$77.5 million for FY2019, mainly due to the absence of retrospective water tariff adjustments in FY2020[48]. - The gross profit for the same period was HK$29.6 million, reflecting a year-on-year decrease of 12.7%[25]. - Gross profit decreased by HK$4.3 million or 12.7% from HK$33.9 million for FY2019 to HK$29.6 million for FY2020, while gross profit margin increased from 43.8% to 50.2%[50]. - Profit before tax decreased by HK$11.9 million or 70.1% from HK$17.0 million in FY2019 to HK$5.1 million in FY2020[58]. - Loss attributable to owners of the Company was HK$5.0 million for FY2020 compared to a profit of HK$1.0 million in FY2019[66]. Environmental Performance - The proportion of national surface water assessment sections with excellent water quality reached 81.8%, an increase of 6.4% year-on-year[13]. - The proportion of sections with poor water quality dropped to 0.8%, a decrease of 2.4% compared to the same period last year[13]. - The "improvement in quality and efficiency" of wastewater treatment facilities has achieved excellent results during the year[13]. - The environmental protection industry in China remained stable throughout 2020, despite challenges posed by the COVID-19 pandemic[13]. - The environmental protection industry in China is expected to benefit from national policies and measures, with a focus on increasing capital investment and driving development through innovation and technology[31]. - The "Action Plan for Prevention and Control of Water Pollution" aims for significant improvements in water quality, including achieving over 70% of key river basins meeting quality standards by 2020[33]. - The Group's wastewater treatment capacity is 80,000 tonnes per day, with a total of 13,047,864 tonnes of wastewater treated in 2020[165]. - In 2020, the Group removed 7,709.08 tonnes of Chemical Oxygen Demand (COD) from treated wastewater[165]. - The wastewater treatment facilities utilize Moving Bed Biofilm Reactor (MBBR) and Cyclic Activated Sludge Technology (CAST) for efficient treatment processes[166]. - The Group adheres to local wastewater treatment standards to ensure the quality of treated wastewater[173]. Business Strategy and Development - The Company will focus on actively promoting the resource utilisation of urban domestic sewage, industrial wastewater, and agricultural sewage[17]. - Central treasury funds for wastewater resource utilisation will be increased, indicating strong demand for wastewater treatment in China[17]. - The Company plans to optimize its business development strategy in response to national policy changes and market dynamics[17]. - The Company aims to contribute to environmental protection by aligning with national water pollution treatment efforts[17]. - The Group is launching a biofuel pellets production business in Indonesia and preparing to construct a new power plant in Bangka, Indonesia, to enhance revenue[21]. - The company is developing a biofuel pellets manufacturing plant in Indonesia, expected to commence operations in late 2021, aiming for diversified growth[42]. - A new power plant with a capacity of 10 megawatts is being developed in Bangka, Indonesia, with agreements for equipment purchases totaling approximately US$1.1 million and RMB10.4 million[42]. - The Group is actively discussing water tariff adjustments for Rugao Hengfa and has reached a preliminary consensus with local authorities[19]. - Water tariffs for Haian Hengfa increased from RMB0.91 per tonne to RMB1.14 per tonne in 2020, contributing to revenue and profit growth[38]. - Rugao Hengfa is expected to raise water tariffs from RMB2.67 per tonne to over RMB3 per tonne, enhancing performance prospects[38]. Financial Health - The net loss for the year was HK$1.5 million[25]. - As of December 31, 2020, bank balances and cash decreased by HK$13.0 million or 20.3% to HK$51.1 million from HK$64.1 million as of December 31, 2019[69]. - The book value of net assets decreased by HK$2.5 million or 0.7% to HK$375.2 million as of December 31, 2020, from HK$377.7 million as of December 31, 2019[68]. - The gearing ratio remained stable at 0.07 and 0.06 as of December 31, 2019, and December 31, 2020, respectively[75]. - Other income and net gains decreased by HK$8.1 million or 60.2% from HK$13.4 million in FY2019 to HK$5.3 million in FY2020, primarily due to foreign exchange losses and absence of sludge processing fee recovery[55]. - Administrative expenses decreased slightly by HK$0.3 million or 1.2% from HK$28.2 million in FY2019 to HK$27.9 million in FY2020, representing 36.4% and 47.2% of revenue for FY2019 and FY2020, respectively[56]. - Finance costs remained stable at HK$2.0 million for FY2020 compared to HK$2.1 million for FY2019[57]. - Employee costs for FY2020 were HK$13.2 million, a decrease from HK$18.6 million in FY2019, with a total of 114 employees as of December 31, 2020[94]. - The Group had no significant investments, material acquisitions, or disposals during FY2020[86]. - No final dividend was recommended for FY2020, compared to HK$0.005 per share in FY2019[97]. - The Group has no plans for other material investments or capital asset additions as of the date of the annual report[87]. Sustainability and Governance - The Group has established an Environmental, Social and Governance Policy to guide sustainable practices across all operations[119]. - ELL Environmental engages stakeholders through various communication channels, including general meetings and site visits, to gather feedback on its sustainability performance[125]. - An independent sustainability consultant conducts annual materiality assessments to identify key environmental, social, and governance issues relevant to the Group[128]. - The Group aims to deliver high-quality environmental protection solutions to mitigate pollution and reduce environmental impact[123]. - ELL Environmental encourages employee participation in voluntary activities, contributing positively to the community[124]. - The reporting methods used in the sustainability report are consistent with previous years, ensuring comparability of performance data[121]. - The Group emphasizes a balanced presentation of both positive and negative information regarding its sustainability performance[120]. - The Group identified 27 ESG issues based on stakeholder communication, listing requirements, and sustainability trends in the industry[131]. - The Board oversees ESG risk management, integrating stakeholder concerns to identify material issues for the Group[143]. - The Group has implemented an Anti-corruption Policy and Code of Conduct to maintain business ethics and integrity[147]. - During the Reporting Period, there were no material non-compliance issues related to corruption or fraud[148]. - The Group's materiality analysis combines stakeholder feedback with management assessments to focus on significant ESG topics[134]. - The Group aims to improve sustainability strategies based on the results of the materiality assessment[132]. Operational Compliance - The Group has implemented comprehensive policies to manage environmental performance and compliance with relevant laws and regulations[160]. - Regular assessments of suppliers are conducted to ensure compliance with quality and environmental standards[159]. - The Group is committed to positive environmental impact as a core responsibility in its operations in China and Indonesia[160]. - No material non-compliance with relevant laws and regulations was reported during the reporting period[160]. - The Group's operations are governed by multiple environmental laws in both China and Indonesia, ensuring adherence to environmental protection standards[160]. - The wastewater treatment business is committed to meeting the Integrated Wastewater Discharge Standard and Class 1-A or Class 1-B requirements, having obtained the necessary Pollutant Emission Permits[177]. - Daily water quality checks include parameters such as chemical oxygen demand (COD), biological oxygen demand (BOD), pH value, and ammonia (NH3), with results documented in monthly reports[177]. - The company has implemented measures to reduce noise pollution, including prioritizing low-noise equipment and conducting regular inspections[196]. - A hazardous waste warehouse has been established at the Haian Hengfa facilities to properly store hazardous waste and prevent leakage[198]. - An environmental impact assessment has been conducted for the biofuel pellet production plant in Indonesia to minimize negative environmental impacts during construction[199]. - The environmental assessment report outlines emissions such as waste, air emissions, and wastewater, along with measures to handle and reduce these emissions[200].

Economic Performance - China's GDP for Q1 2020 was RMB 20.7 trillion, representing a 6.8% decline year-over-year due to the COVID-19 pandemic[15]. - China's GDP for Q1 2020 was RMB20,650.4 billion, reflecting a decrease of 6.8% compared to the same period last year due to the COVID-19 pandemic[31]. Environmental Protection Initiatives - The environmental protection industry in China remained stable during 2020, supported by the government's "13th Five-Year Plan" for Nationwide Integrated Treatment of Rural Environment[15]. - The investment scale for water environmental treatment during the "13th Five-Year Plan" reached RMB734.4 billion, indicating strong government focus on environmental protection[32]. - The environmental protection industry is expected to benefit from national policies and continuous market demand, leading to a prudent yet optimistic outlook for future business development[22]. - The Group is promoting "Build-Operate-Transfer" (BOT) investment projects to generate stable cash flows and investment returns[38]. - The Group is actively seeking alternatives for its biomass power project to secure overall business operations[19]. - The Group is developing a biofuel pellet business in Indonesia and exploring investment opportunities in other power generation plants[20]. - The Group's biomass power plant operations in Indonesia have been suspended due to low market consumption and competition, with ongoing exploration of new environmental projects[38]. - The Group is actively expanding its biofuel pellet business in Indonesia and seeking cooperation opportunities with other power plants[39]. - The Group aims to enhance risk management strategies and review the development progress of various environmental protection projects[22]. Financial Performance - Total revenue increased by HK$2.0 million or 8.2% to HK$26.4 million for the Period from HK$24.4 million for the Last Corresponding Period[44]. - Revenue from the wastewater treatment facility increased by RMB6.8 million due to an increase in water tariff from RMB0.91 to RMB1.14 per tonne since July 2019[44]. - Revenue from operations in the PRC segment increased by HK$3.2 million or 14.0% to HK$26.4 million for the Period[46]. - Gross profit increased by HK$11.4 million or 480.1% to HK$13.7 million for the Period, with a gross profit margin of 52.1%[50]. - Profit before tax of HK$0.3 million was recognized for the Period compared to a loss before tax of HK$9.0 million for the Last Corresponding Period[59]. - Loss attributable to owners of the Company decreased by HK$6.1 million or 55.8% to HK$4.8 million for the Period from HK$10.9 million for the Last Corresponding Period[61]. - Revenue for the six months ended June 30, 2020, was HK$26,369,000, an increase of 8.2% compared to HK$24,362,000 for the same period in 2019[141]. - Gross profit for the same period was HK$13,726,000, significantly up from HK$2,366,000, indicating a gross margin improvement[141]. - Loss for the period narrowed to HK$3,211,000 from HK$11,030,000 in the previous year, reflecting a 70.9% reduction in losses[141]. - Total comprehensive expense for the period was HK$8,452,000, compared to HK$10,991,000 in the prior year, indicating a decrease of 14.0%[143]. Cash Flow and Assets - As of June 30, 2020, the Group's bank balances and cash amounted to HK$39.9 million, a decrease of 37.7% from HK$64.1 million as of December 31, 2019[63]. - For the six months ended June 30, 2020, the company reported a net cash flow used in operating activities of HK$7,446,000, compared to HK$3,334,000 in the same period of 2019, indicating a significant increase in cash outflow[155]. - The company reported a net decrease in cash and cash equivalents of HK$22,652,000 for the first half of 2020, compared to a decrease of HK$8,418,000 in the same period of 2019[155]. - Cash and cash equivalents at the end of the period stood at HK$39,894,000, an increase from HK$37,654,000 at the end of June 2019[155]. - Current assets decreased to HK$89,294,000 from HK$115,455,000, reflecting a reduction of about 22.6%[146]. - Total assets less current liabilities amounted to HK$407,912,000, a decrease from HK$430,697,000 as of December 31, 2019, representing a decline of approximately 5.3%[146]. Shareholder Information - As of June 30, 2020, Mr. Chau holds 225,000,000 shares, representing approximately 20.32% of the company's shareholding[114]. - Mr. Chan holds 390,700,000 shares, accounting for about 35.28% of the company's shareholding[114]. - Everbest Environmental Investment Limited has a beneficial interest in 375,000,000 shares, which is approximately 33.87% of the company's total shares[123]. - The total shares held by Ms. Wong, including her interests in controlled corporations, amount to 402,580,000 shares, representing about 36.36% of the company's shareholding[123]. - Wealthy Sea Holdings Limited, owned by Mr. Chau and his wife, holds 225,000,000 shares, equating to 20.32% of the company's shares[123]. - Morgan Top Trading Co., Ltd. has a beneficial interest in 143,300,000 shares, which is approximately 12.94% of the company's total shares[123]. - As of June 30, 2020, no other directors or executives had interests or short positions in the company's shares that were not disclosed[118]. Corporate Governance - The company has complied with all applicable code provisions of the Corporate Governance Code throughout the reporting period[127]. - All directors confirmed compliance with the Model Code governing securities transactions during the reporting period[128]. - The company maintains a high standard of corporate governance and adheres to the principles set out in the Corporate Governance Code[127]. - There were no significant changes in directors' information, maintaining stability in corporate governance[135]. Other Financial Metrics - The effective tax rate for PRC subsidiaries was 27.9% for the Period compared to 82.5% for the Last Corresponding Period[65]. - The total tax charge for the period was HK$3,496,000, up from HK$1,986,000 in 2019, primarily due to an increase in PRC Corporate Income Tax[191]. - The company reported other income and net gains of HK$262,000, down from HK$3,038,000 in the previous year, reflecting a decrease of 91.4%[141]. - Administrative expenses decreased to HK$12,683,000 from HK$13,610,000, a reduction of 6.8%, contributing to improved financial results[141].

Economic Performance - In 2019, China's GDP was RMB 99.1 trillion, representing a growth of 6.1% compared to the previous year[11]. - The Group's financial performance was impacted by the uncertainties of the Sino-US trade war, but China's GDP for FY2019 reached approximately RMB99,100 billion[24]. - Total revenue decreased by HK$1.6 million or 2.0% to HK$77.5 million for FY2019 compared to HK$79.1 million for FY2018[36]. - Construction revenue dropped by HK$5.0 million or 44.7% from HK$11.2 million for FY2018 to HK$6.2 million for FY2019[36]. - Revenue from electricity sales generated from Biomass power plants fell by HK$30.1 million or 96.4% from HK$31.2 million for FY2018 to HK$1.1 million for FY2019[36]. - Revenue from wastewater treatment facility operation services increased by HK$33.9 million or 157.4% from HK$21.5 million for FY2018 to HK$55.4 million for FY2019 due to a tariff adjustment[36]. - The company recorded a profit before tax of HK$17.0 million for FY2019, compared to a loss before tax of HK$141.1 million for FY2018[58]. Tariff Adjustments and Revenue Expectations - The Group's wastewater treatment facilities in Jiangsu Province successfully increased water tariffs from RMB 0.91 per tonne to RMB 1.14 per tonne in 2019[15]. - The Group's revenue and gross profit are expected to increase with gradual tariff adjustments in wastewater treatment services[15]. - The Group successfully increased water tariffs for Haian Hengfa from RMB0.91 per tonne to RMB1.14 per tonne in FY2019[26]. - The Group is actively negotiating with authorities for optimal water tariff adjustments for Rugao Hengfa[26]. - The Group expects revenue and gross profit to increase following gradual adjustments in water tariffs[26]. Environmental Protection Initiatives - The environmental protection industry in China experienced active development due to supportive national policies and increased demand for wastewater treatment[11]. - The Group aims to explore cooperation opportunities with other power generation plants in Indonesia[14]. - The Group is actively developing the biofuel pellet business in Indonesia to diversify its environmental protection business[14]. - The Group aims to diversify and expand its environmental protection business through the biofuel pellet initiative[31]. - The Group's sustainability approach includes protecting employees' rights and ensuring occupational health and safety[105]. - The Group's environmental initiatives include air emissions management, energy consumption reduction, and waste management[124]. - The Group is committed to alleviating pollution problems and building a greener environment for future generations[141]. Financial Position and Cost Management - The Group's financial position is anticipated to improve with the successful implementation of tariff adjustments and new business developments[15]. - Total cost of sales decreased by HK$24.8 million or 36.3% from HK$68.4 million for FY2018 to HK$43.6 million for FY2019[41]. - Gross profit increased by HK$23.2 million or 217.6% from HK$10.7 million for FY2018 to HK$33.9 million for FY2019[42]. - Gross profit margin improved from 13.5% for FY2018 to 43.8% for FY2019[43]. - Administrative expenses decreased by HK$4.5 million or 13.8% from HK$32.7 million in FY2018 to HK$28.2 million in FY2019, representing 41.3% and 36.4% of revenue for FY2018 and FY2019, respectively[51]. Employee and Labor Management - As of December 31, 2019, the Group employed a total of 116 employees, with a distribution across various categories including gender, employment type, and age[193]. - The Group strictly adhered to applicable labor-related laws and regulations, ensuring no violations were reported during the reporting period[192]. - Employee distribution by gender showed a total of 80 male and 36 female employees in 2019[195]. - The total number of employees increased from 114 in 2018 to 116 in 2019, reflecting a slight growth[198]. - The Group maintained a people-oriented approach, emphasizing the importance of employees as valuable assets for sustainable development[192]. Environmental Compliance and Monitoring - The Group ensures compliance with the Integrated Wastewater Discharge Standard and conducts regular monitoring of water quality indicators[151]. - Environmental non-compliance issues at Rugao Hengfa Facility have been rectified, with third-party monitoring conducted[145]. - The company has implemented a sophisticated emission management system to minimize environmental impact, addressing air and greenhouse gas emissions, odour, and wastewater[166]. - Regular monitoring of effluent discharge quality is conducted at Jiangsu facilities to ensure compliance with government regulations[168]. - The company has established a waste management system for handling solid wastes in wastewater treatment facilities[171]. Community Engagement and Stakeholder Communication - The Group emphasizes the importance of stakeholder opinions in decision-making and sustainability practices, conducting annual materiality assessments through online surveys[114]. - The Group has established formal and informal communication channels with stakeholders to understand their opinions and expectations regarding business operations[109]. - The Group actively participates in volunteer activities and charitable donations as part of its community engagement strategy[124]. - The Group encourages employees to participate in voluntary activities and contribute to community investment[110]. Supplier Management and ESG Compliance - The Group has established a Code of Conduct for suppliers, focusing on environmental protection, labor rights, and anti-corruption, ensuring compliance through regular assessments[136]. - The Group's supplier management policies aim to ensure the best quality of products and services while promoting sustainable development across the supply chain[136]. - The Group's Board oversees environmental, social, and governance risk management, regularly reviewing mechanisms to cover relevant ESG issues and risks[127]. - During the Reporting Period, there were no violations of laws and regulations related to corruption, bribery, extortion, money laundering, and fraud[130].

Financial Performance - For the six months ended June 30, 2019, ELL Environmental recorded a revenue of approximately HK$24.4 million, representing a year-on-year decrease of 41.4%[23] - The gross profit for the same period was HK$2.4 million, reflecting a year-on-year decrease of 64.8%[23] - The net loss for the first half of 2019 was HK$11.0 million, which included a HK$2.3 million loss from the biomass power generation project in Indonesia[23] - Total revenue decreased by HK$17.2 million or 41.4% to HK$24.4 million for the period from HK$41.6 million for the last corresponding period[42] - Revenue from operations in the Indonesia segment decreased by HK$10.6 million or 89.7% to HK$1.2 million for the period from HK$11.9 million for the last corresponding period[42] - Gross profit decreased by HK$4.4 million or 64.8% to HK$2.4 million for the period from HK$6.7 million for the last corresponding period[47] - Loss before tax decreased by HK$36.4 million or 80.1% to HK$9.0 million for the period from HK$45.5 million for the last corresponding period[51] - Loss attributable to owners of the Company decreased by HK$35.9 million or 76.7% to HK$10.9 million for the period from HK$46.9 million for the last corresponding period[53] - Basic loss per share for the period was HK$1.00, an improvement from HK$4.22 in the same period last year[138] Market Environment - The Chinese government allocated special funds of RMB19.0 billion for water pollution prevention and control in 2019, which is expected to benefit the water treatment industry[18] - The company anticipates that the environmental protection industry will benefit from rapid urbanization and supportive government policies, providing a favorable macro environment[24] - The overall macro environment for the environmental protection industry in China is favorable due to government support for water treatment initiatives[30][32] - The overall Chinese economy maintained a steady growth with a GDP of RMB21 trillion in Q1 2019, growing by 6.4% year-on-year[17] - The Chinese government implemented "Six Stabilities" policies, contributing to a stable GDP growth of 6.4% in Q1 2019, which is expected to benefit the environmental protection industry[30][32] Operational Challenges - The operation level of the biomass power plant in Indonesia was reduced in the first half of 2019 due to lower-than-expected market consumption of electricity[22] - The biomass power plant in Indonesia has not reached expected utilization rates, leading to a net loss of approximately HK$2.3 million in the first half of 2019 due to low local electricity consumption and increased competition[35] - The company expects the operation of the biomass power plant to return to normal in the third quarter of 2019 with the commencement of biofuel pellet production and sales in Indonesia[22] - The company plans to resume normal operations of the Indonesian power plant with the commencement of biofuel pellets production, which will increase the plant's utilization rate[36] Strategic Initiatives - ELL Environmental is actively exploring opportunities to cooperate with other power plants to create new business opportunities[22] - ELL Environmental is actively seeking partnerships with other power plants to promote the development of its biofuel pellets business, aiming for strategic diversification[36] - The Group plans to solidify its foundation in China's wastewater treatment market and develop environmental protection-related industrial chain projects[41] - The Group is exploring opportunities for collaboration with other power plants to promote its biomass pellet business[38] Financial Management - ELL Environmental aims to strengthen its internal controls and adopt a prudent approach to financial and operational management moving forward[24] - ELL Environmental is committed to prudent financial and operational management to navigate market risks and instability while pursuing business expansion[31] - The Group's administrative expenses decreased by HK$2.6 million or 15.9% to HK$13.6 million for the period from HK$16.2 million for the last corresponding period[49] Shareholder Information - The Board resolved not to declare any interim dividend for the Period, consistent with the previous year[89] - The company repurchased 700,000 shares at a price of HK$0.14 per share, totaling HK$98,000 excluding transaction costs[126] - Mr. Chau holds 225,000,000 shares, representing approximately 20.32% of the company's shareholding[106] - Mr. Chan holds 390,700,000 shares, representing approximately 35.28% of the company's shareholding[106] - Everbest Environmental holds 375,000,000 shares, representing approximately 33.87% of the company's shareholding[115] - Ms. Wong has an interest in controlled corporations totaling 380,790,000 shares, representing approximately 34.39% of the company's shareholding[115] - Wealthy Sea holds 225,000,000 shares, representing approximately 20.32% of the company's shareholding[115] - Morgan Top Trading Co., Ltd. holds 143,300,000 shares, representing approximately 12.94% of the company's shareholding[115] Assets and Liabilities - As of June 30, 2019, the group's bank balances and cash amounted to HK$37.7 million, a decrease of 15.0% from HK$44.3 million as of December 31, 2018[62] - The total amount of utilized bank borrowings was HK$37.0 million, with approximately HK$32.5 million repayable within one year[64] - The gearing ratio remained stable at 0.1 as of June 30, 2019, and December 31, 2018[66] - Total equity decreased to HK$363,291,000 from HK$374,376,000, a reduction of about 3.0%[144] - Current assets decreased to HK$99,855,000 from HK$119,429,000, representing a decline of about 16.4%[142] - Net current assets were HK$56,324,000, down from HK$70,671,000, indicating a decrease of approximately 20.3%[142] - Non-current liabilities remained relatively stable at HK$52,706,000 compared to HK$52,754,000, showing a slight decrease of 0.1%[144] Accounting Policies - The Group has applied HKFRS 16 for the first time, which supersedes HKAS 17 "Leases" and has had no material impact on the Group's financial performance for the current and prior periods[167] - The Group's accounting policies remain consistent with those presented in the consolidated financial statements for the year ended December 31, 2018, except for changes due to the application of new HKFRSs[164] - The Group assesses whether a contract is or contains a lease based on the definition under HKFRS 16 at inception or modification date[170]

Economic Performance - In 2018, China's GDP growth was 6.6%, experiencing a slowdown throughout the year[12] - China's GDP for the year reached RMB90,030.9 billion, exceeding expectations, indicating a stable economic environment for the water treatment industry[27] Environmental Regulations - The revised Water Pollution Prevention and Control Law, effective from January 1, 2018, included 55 major amendments to enhance wastewater treatment demand[12] - The environmental protection industry in China continued to grow steadily in 2018, supported by national policies[12] - The environmental protection industry is expected to benefit from increased government attention and support for wastewater treatment issues[12] Company Performance - ELL Environmental recorded a revenue of approximately HK$79.1 million for the year, representing a year-on-year increase of 0.1%[18] - The gross profit was HK$10.7 million, reflecting a significant year-on-year increase of 120.5%[18] - The net loss for the year was HK$144.7 million, which included impairments of HK$39.9 million to goodwill and HK$79.7 million to property, plant, and equipment related to the biomass power generation project in Indonesia[18] - Total revenue for the year remained stable at HK$79.1 million, compared to HK$79.0 million in the previous year[40] - Revenue from wastewater treatment facility operation services decreased by HK$15.6 million or 42.0% from HK$37.1 million to HK$21.5 million, primarily due to the disposal of Rugao Honghao Facility[40] - Revenue from the sales of electricity generated from biomass power plants in Indonesia increased by HK$4.4 million or 16.6% from HK$26.8 million to HK$31.2 million[40] Business Strategy - The Group has focused on improving the efficiency of power generation facilities to lower costs and enhance returns[16] - The Group adopted a practical and prudent approach towards business expansion in response to market changes[12] - The Group's strategy includes monitoring the performance of power plants and the development of neighboring areas to improve efficiency[16] - The Group aims to expand its business steadily while strengthening its foundation in China's wastewater treatment market and exploring potential environmental protection businesses[39] Impairments and Losses - An impairment loss of HK$39.9 million was recognized on goodwill and HK$79.7 million on property, plant, and equipment in the Indonesian subsidiary RPSL[49] - The net present value of cash flows from RPSL operations decreased by HK$127.6 million or 71.3% from HK$179.1 million to HK$51.5 million[49] - The expected electricity unit price is projected to decrease by 25.3% in the upcoming year compared to the existing contracted price[49] Administrative and Financial Costs - Administrative expenses rose by HK$8.0 million or 32.2% to HK$32.7 million, representing 41.3% of revenue for 2018[62] - Finance costs increased by HK$0.7 million or 50.2% to HK$2.2 million, mainly due to interest on short-term borrowing[63] - Loss before tax escalated by HK$90.2 million or 177.3% to HK$141.1 million for the year[64] - Income tax expense decreased by HK$6.3 million or 63.9% to HK$3.6 million, primarily due to a reduction in current tax expense in Rugao Hengfa[65] Employee and Training Initiatives - As of December 31, 2018, the Group had 227 employees, with employee costs amounting to HK$21.0 million, an increase from HK$20.2 million in 2017[102] - The percentage of employees trained by gender shows 51.9% of males and 19.6% of females received training[162] - Average training hours completed per employee are 30 hours for males and 4 hours for females[166] Corporate Governance and Compliance - The Group aims to operate in a responsible and transparent manner, focusing on sustainability and stakeholder engagement[117] - The Group has established effective communication channels to engage stakeholders and address their concerns[121] - The Group's environmental, social, and governance (ESG) policy mandates suppliers to adhere to ethical standards, including zero tolerance for child and forced labor[186][190] - The Group is committed to maintaining high standards of integrity and compliance with applicable laws, including anti-corruption policies and whistle-blowing mechanisms[194][195] Community Engagement and Social Responsibility - The Group initiated community support programs, including monetary donations and essential goods distribution during significant local events[199] - The Group's biomass generation plant in Jambi, Indonesia, adhered to local regulations promoting corporate social responsibility and community welfare programs[198]