Core Viewpoint - The establishment of a joint venture by the company aims to explore investment opportunities in the environmental services and wastewater treatment sectors, enhancing the development of its existing business [1][2] Group 1: Joint Venture Details - The joint venture's registered capital will increase from RMB 50 million to RMB 96.5 million through a capital injection agreement [1] - The capital contributions will be RMB 40.18 million from Tian Tai Construction, RMB 45.355 million from the company, and RMB 0.965 million from Zhejiang Construction Environmental Protection [1] Group 2: Strategic Implications - The joint venture is a strategic move to tap into the wastewater treatment market, which is expected to improve the financial performance and revenue sources of the group [2] - The formation of the joint venture is anticipated to create synergies, resource integration, and better business development for both the company and Zhejiang Construction Environmental Protection [2]

Financial Performance - The Group's revenue for 2024 was approximately HK$6.1 billion, with a profit attributable to owners of the Company of approximately HK$53.7 million[14]. - The Group's total revenue increased by approximately HK$620.4 million or approximately 11.4%, from approximately HK$5,445.6 million for the year ended December 31, 2023, to approximately HK$6,066.0 million for the Reporting Period[63]. - Revenue from building construction works rose by approximately HK$711.5 million or approximately 15.1%, from approximately HK$4,703.0 million to approximately HK$5,414.5 million, driven by new and existing projects[64]. - Revenue from RMAA works decreased by approximately HK$16.7 million or approximately 3.2%, from approximately HK$528.7 million to approximately HK$512.0 million, due to existing projects nearing completion[65]. - Revenue from environmental operations fell by approximately HK$74.4 million or approximately 34.8%, from approximately HK$213.9 million to approximately HK$139.5 million, primarily due to decreased revenue from construction and rehabilitation services[66]. - Net profit decreased by approximately HK$18.2 million or 25.2% to approximately HK$54.0 million, with net profit margin declining from 1.3% to 0.9%[92]. - Finance costs increased by approximately HK$13.2 million to approximately HK$65.8 million due to higher average bank loan balances[90]. - Income tax expense increased by approximately HK$13.9 million or 109.4% to approximately HK$26.6 million, primarily due to the absence of tax loss utilization[91]. Project Development - The Group won tenders for a total of 20 new projects during the Reporting Period, with an aggregate original contract sum of approximately HK$8.8 billion for newly awarded projects[14]. - The Group's subsidiary, ZCIEE, had 2 projects with an aggregate original contract sum of approximately HK$5.4 million and 21 projects related to service concession arrangements and operation services during the Reporting Period[15]. - The Malaysia company undertook its first large-scale project in renewable energy power stations, while the UK company's residential project in Manchester set a new record for the Group's largest single contract value in the UK market[14]. - The Yongkang Agricultural Wastewater Treatment Project marked the Group's successful expansion into a new market in Jinhua City, Zhejiang Province[15]. - As of December 31, 2024, the Group had 52 projects on hand with an aggregate original contract sum of approximately HK$33.1 billion[35]. - During the Reporting Period, the Group was awarded 20 new projects with an aggregate original contract sum of approximately HK$8.8 billion and completed 12 projects totaling approximately HK$3.2 billion[35]. Business Strategy and Expansion - The Group continued to expand its business in the environmental market in the UK, Malaysia, and Mainland China, enhancing its diversified business structure[15]. - The Group's strategic focus remains on optimizing development strategies across both construction and environmental sectors[15]. - The Group plans to consolidate and develop markets in Malaysia and the United Kingdom, leveraging its state-owned enterprise background for expansion[28]. - The Group aims to deepen its diversified development strategy by enhancing R&D and promoting smart building technology[30]. - The establishment of a new subsidiary, NET, marks the Group's entry into the new energy industry, with 7 energy storage projects expected to commence in 2025[43]. Technological Innovation and Safety - The Group is committed to achieving high-quality development and raising profitability through technological research and development[18]. - The Group upgraded its Smart Site Safety System (4S) and obtained ISO27001 certification, enhancing safety and efficiency on construction sites[20]. - The Group developed a Safety Tracking Watch for real-time monitoring of site workers' location and health status, improving safety measures[20]. - The Group has placed significant emphasis on technological innovation, with total research and development expenditure of approximately HK$20.1 million[46]. - The Group signed a memorandum of understanding with the Hong Kong Centre for Construction Robotics to enhance collaboration in smart construction technology and innovation[50]. Awards and Recognition - The Group received the "Top 10 Construction Contractors in Hong Kong" award for the third consecutive year and the "Most Outstanding Construction Engineering Service of the Year" in the HKCT Business Awards 2024[19]. - The Centralised General Research Laboratory Complex project at the Chinese University of Hong Kong won multiple awards, including the Silver Prize in the Considerate Contractors Site Award Scheme[19]. - The Group has been recognized for its contributions to environmental protection and innovation, receiving the "2024 Xihu District Government Quality Award"[44]. Management and Governance - The company has a strong leadership team with extensive experience in the construction industry, enhancing its operational capabilities and strategic direction[135][140][147]. - The company has adopted the Corporate Governance Code and has complied with all applicable code provisions during the Reporting Period[194]. - The Board is responsible for overall leadership and has delegated day-to-day management to senior management[195]. - The company emphasizes the importance of independent oversight in its governance structure[157]. Financial Stability and Commitments - As of December 31, 2024, the group's gearing ratio was approximately 30.2%, a decrease from approximately 42.3% in 2023, indicating improved financial stability[111]. - The group had capital commitments of approximately HK$1.2 million as of December 31, 2024, down from approximately HK$16.2 million in 2023[108]. - Performance bonds amounted to approximately HK$2,100.0 million as of December 31, 2024, compared to approximately HK$1,800.1 million in 2023, indicating an increase in contractual obligations[109]. - The Group's liquidity position is healthy, financed mainly by internal and external resources[116].

Financial Performance - Total revenue for the year ended December 31, 2024, increased to approximately HKD 6,066.0 million, up from HKD 5,445.6 million for the year ended December 31, 2023, representing a growth of about 11.3%[2] - Gross profit for the year ended December 31, 2024, rose to approximately HKD 353.2 million, compared to HKD 306.0 million for the previous year, marking an increase of approximately 15.4%[2] - Profit attributable to equity holders for the year ended December 31, 2024, was approximately HKD 53.7 million, down from HKD 71.9 million in the previous year, reflecting a decrease of about 25.3%[2] - Basic and diluted earnings per share for the year ended December 31, 2024, were HKD 0.1074, compared to HKD 0.1438 for the year ended December 31, 2023, indicating a decline of approximately 25.3%[4] - The total profit before tax for the group was HKD 80,544,000 in 2024, compared to HKD 84,901,000 in 2023, indicating a decrease of approximately 5.3%[18] - The group reported a basic earnings per share of HKD 0.1073, based on a profit attributable to equity holders of HKD 53,715,000 for the year, compared to HKD 71,887,000 in the previous year[40] - Net profit decreased by approximately 25.2% to about HKD 54.0 million from HKD 72.2 million, with net profit margins of approximately 1.3% and 0.9% for the years ending December 31, 2023, and 2024, respectively[78] Revenue Breakdown - Total revenue for the construction segment reached HKD 5,926,563,000 in 2024, up from HKD 5,231,681,000 in 2023, representing an increase of approximately 13.3%[18] - Revenue from the construction business segment reached HKD 5,926,563,000, up 13.3% from HKD 5,231,681,000 in the previous year[28] - Revenue from environmental services decreased to HKD 128,544,000 from HKD 205,236,000, a decline of 37.4%[28] - Revenue from environmental business decreased by approximately HKD 74.4 million or about 34.8% to approximately HKD 139.5 million, primarily due to reduced income from construction and renovation services[63] Assets and Liabilities - Total assets less current liabilities as of December 31, 2024, amounted to HKD 931.8 million, an increase from HKD 728.2 million as of December 31, 2023[7] - Current assets as of December 31, 2024, totaled HKD 4,489.8 million, compared to HKD 3,777.7 million in the previous year, representing an increase of approximately 18.8%[7] - Current liabilities as of December 31, 2024, were HKD 3,924.4 million, up from HKD 3,403.2 million in the previous year, reflecting an increase of about 15.3%[7] - Non-current liabilities increased to HKD 255.9 million as of December 31, 2024, from HKD 93.3 million in the previous year, indicating a significant rise of approximately 174.5%[8] - The total assets of the group increased to HKD 4,856,182,000 in 2024 from HKD 4,131,355,000 in 2023, marking a growth of around 17.5%[20] - The total liabilities rose to HKD 4,180,289,000 in 2024, up from HKD 3,496,506,000 in 2023, which is an increase of approximately 19.6%[20] Dividends - The company proposed a final dividend of HKD 0.018 per share, totaling approximately HKD 9.0 million[2] - The proposed final dividend for the year is HKD 0.018 per share, consistent with the previous year’s dividend[39] - The board proposed a final dividend of HKD 0.018 per share for the reporting period, consistent with the previous year's dividend[93] Research and Development - The company incurred research and development expenses of HKD 20,074,000, an increase from HKD 17,510,000 in the previous year, indicating a focus on innovation[36] - The group is focusing on technological innovation with total R&D expenditure of approximately HKD 20.1 million to enhance core competitiveness in the construction industry[55] Financial Management - The company continues to manage its financial position prudently and frequently reviews its liquidity and financing needs[90] - The company maintains a conservative cash and financial management policy to ensure it meets its funding requirements for business development[90] - The company has adopted corporate governance practices to safeguard shareholder interests and enhance corporate value[96] Taxation - The total tax expense for the year was HKD 26,594,000, significantly up from HKD 12,676,000 in the previous year, reflecting an increase in current tax liabilities[39] - Income tax expense increased by approximately 109.4% to about HKD 26.6 million from HKD 12.7 million, with effective tax rates of approximately 14.9% and 33.0% for the years ending December 31, 2023, and 2024, respectively[76] Project Management - The group secured 20 new projects during the year with a total original contract value of approximately HKD 8.8 billion, while completing 12 projects valued at HKD 3.2 billion[50] - The group has 52 ongoing projects with a total original contract value of approximately HKD 33.1 billion as of December 31, 2024[50] Other Financial Metrics - The company has adopted revised Hong Kong Financial Reporting Standards for the current financial year, impacting the accounting policies applied[14] - The debt-to-equity ratio improved to approximately 30.2% from 42.3%[86] - As of December 31, 2024, the company's interest-bearing bank borrowings amounted to approximately HKD 534.2 million, an increase from HKD 415.6 million in 2023[89] - The company pledged accounts receivable and contract assets with a net book value of HKD 187.2 million as of December 31, 2024, compared to HKD 174.6 million as of December 31, 2023[89]

Corporate Information [Corporate Structure and Key Personnel](index=3&type=section&id=Corporate%20Information) This section details CR Construction Group Holdings Limited's corporate structure, including board and committee compositions, key advisors, and notes the resignation of two non-executive directors during the period - The company's Board of Directors comprises executive, non-executive, and independent non-executive directors, with independent non-executive directors chairing the Audit, Remuneration, and Nomination Committees, aligning with corporate governance standards[3](index=3&type=chunk)[4](index=4&type=chunk) - Non-executive directors Ms. Ding Shaojian and Mr. Fan Jingbo resigned on June 11, 2024[3](index=3&type=chunk) Chairman's Statement [Chairman's Statement](index=6&type=section&id=Chairman%27s%20Statement) The Chairman's Statement outlines the Group's H1 2024 performance, business review, and future outlook, emphasizing resilient results despite market challenges, new project acquisitions, and significant investment in technological innovation H1 2024 Performance Overview | Indicator | Amount/Quantity | | :--- | :--- | | **Total Revenue** | Approx. 2,773.2 Million HKD | | **Profit Attributable to Owners of the Company** | Approx. 35.8 Million HKD | | **New Construction Project Wins** | 9 projects, total contract value approx. 4.1 Billion HKD | | **Environmental Business Projects** | 3 contracts (approx. 6.9 Million HKD), 19 service concession arrangements | - The Group actively implemented measures such as innovation, resource optimization, cost reduction, and efficiency improvement to sustain healthy business growth amidst industry challenges[8](index=8&type=chunk)[11](index=11&type=chunk) - The company prioritizes technological innovation, successfully developing the "4S Smart Site Safety System" with ISO 27001 certification and modular bio-disk equipment for rural wastewater treatment, enhancing engineering efficiency and safety[13](index=13&type=chunk)[14](index=14&type=chunk)[15](index=15&type=chunk) - The Group's future strategy focuses on four key areas: increasing talent development investment, pursuing diversified growth and technological innovation, expanding domestic and international market presence, and aligning with government development policies to explore public and environmental projects[20](index=20&type=chunk) Financial and Operational Data Highlights [Financial and Operational Data Highlights](index=11&type=section&id=Financial%20and%20Operational%20Data%20Highlights) This section summarizes the Group's key financial data for the six months ended June 30, 2024, noting a slight revenue decrease, significant gross profit increase, reduced profit attributable to owners, and the declaration of an interim dividend H1 2024 Financial Summary (Year-on-Year) | Indicator | H1 2024 (Million HKD) | H1 2023 (Million HKD) | Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | 2,773.2 | 2,832.1 | -2.1% | | **Total Gross Profit** | 188.1 | 150.5 | +25.0% | | **Profit Attributable to Owners of the Company** | 35.8 | 45.5 | -21.3% | | **Interim Dividend (Per Share)** | 1.5 HK cents | 1.5 HK cents | Unchanged | Management Discussion and Analysis [Business Review](index=12&type=section&id=Business%20Review) The Group operates in two segments: construction, a leading contractor in Hong Kong, Malaysia, and the UK with 47 ongoing projects totaling HKD 28.5 billion; and environmental, focused on wastewater treatment in mainland China, which secured its first project outside Zhejiang and achieved "Specialized, Refined, and New" SME recognition Construction Business Project Overview (As of June 30, 2024) | Indicator | Quantity/Amount | | :--- | :--- | | **Projects on Hand** | 47 projects | | **Original Contract Value of Projects on Hand** | Approx. 28.5 Billion HKD | | **New Projects Awarded During the Period** | 9 projects | | **Original Contract Value of New Projects Awarded** | Approx. 4.1 Billion HKD | | **Projects Completed During the Period** | 6 projects | | **Original Contract Value of Completed Projects** | Approx. 3.1 Billion HKD | - Zhejiang Construction Environmental Protection, an environmental business subsidiary, secured a rural wastewater treatment project in Kunshan, Jiangsu Province, marking its first expansion outside Zhejiang Province[26](index=26&type=chunk)[27](index=27&type=chunk) - Zhejiang Construction Environmental Protection was recognized as a 2024 Zhejiang Provincial "Specialized, Refined, and New" SME, demonstrating its leading position in technology, market, quality, and efficiency[26](index=26&type=chunk)[27](index=27&type=chunk) [The Prospects](index=14&type=section&id=The%20Prospects) For H2 2024, the Group anticipates stable Hong Kong economic growth and positive impacts from relaxed compulsory sale thresholds, with imported labor potentially easing cost pressures; it will continue R&D investment (HKD 11.6 million in H1) and seek new construction and environmental opportunities globally - Subsequent to the reporting period, the Group was awarded one new construction project with an original contract value of approximately **HKD 2.1 billion**[28](index=28&type=chunk) - The Group's total R&D expenditure during the reporting period was approximately **HKD 11.6 million**, primarily invested in its proprietary "4S Smart Site Safety System" and integrated rural domestic wastewater treatment equipment[28](index=28&type=chunk)[32](index=32&type=chunk) - The government's "Land (Compulsory Sale for Redevelopment) (Amendment) Bill" is expected to lower compulsory sale thresholds, facilitating large-scale redevelopment projects and positively impacting the Group's business[33](index=33&type=chunk)[35](index=35&type=chunk) [Principal Risks and Uncertainties](index=16&type=section&id=Principal%20Risks%20and%20Uncertainties) The Group faces principal business risks from project non-recurrence, intense bidding, license dependency, cost overruns, and safety failures, alongside industry and market risks from high competition and macroeconomic fluctuations in its core markets including Hong Kong, Malaysia, the UK, and mainland China - Business risks include the Group's revenue primarily deriving from non-recurring projects obtained through competitive bidding with no guaranteed success rate, reliance on various licenses for operations, and potential discrepancies between estimated and actual costs in tender pricing[36](index=36&type=chunk)[38](index=38&type=chunk) - Industry and market risks stem from intense competition within the construction sector and the Group's susceptibility to economic conditions in its key markets, including Hong Kong, Malaysia, the UK, and mainland China[37](index=37&type=chunk)[39](index=39&type=chunk) [Financial Review](index=17&type=section&id=Financial%20Review) In H1 2024, the Group's total revenue decreased by 2.1% to HKD 2.773 billion, primarily due to a 40.5% drop in environmental business revenue; however, overall gross profit increased by 25% to HKD 188 million, with margin improving to 6.8%, though net profit declined by 21.3% to HKD 36.2 million due to higher administrative expenses, finance costs, and a HKD 17.7 million expected credit loss provision Revenue Performance by Business Segment (H1 2024 vs H1 2023) | Business Segment | H1 2024 Revenue (Million HKD) | H1 2023 Revenue (Million HKD) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Building Construction Works | 2,414.3 | 2,455.9 | -1.7% | | RMAA Works | 290.6 | 261.4 | +11.2% | | Environmental Business | 68.3 | 114.8 | -40.5% | | **Total** | **2,773.2** | **2,832.1** | **-2.1%** | Gross Profit and Gross Margin Performance by Business Segment (H1 2024 vs H1 2023) | Business Segment | H1 2024 Gross Profit (Million HKD) | H1 2024 Gross Margin | H1 2023 Gross Profit (Million HKD) | H1 2023 Gross Margin | | :--- | :--- | :--- | :--- | :--- | | Building Construction Works | 126.7 | 5.2% | 130.6 | 5.3% | | RMAA Works | 43.2 | 14.9% | -1.4 | -0.5% | | Environmental Business | 18.2 | 26.6% | 21.3 | 18.5% | | **Total** | **188.1** | **6.8%** | **150.5** | **5.3%** | - Net other operating expenses shifted from an income of **HKD 2.1 million** in the prior period to an expense of **HKD 16.9 million** this period, primarily due to a **HKD 17.7 million** provision for expected credit losses on receivables under HKFRS 9[54](index=54&type=chunk)[58](index=58&type=chunk) - Finance costs increased by **HKD 10.6 million** year-on-year to **HKD 29.7 million**, mainly driven by rising HIBOR (Hong Kong Interbank Offered Rate)[59](index=59&type=chunk) - The Group's net profit decreased by **21.3%** year-on-year, from **HKD 46.0 million** to **HKD 36.2 million**[59](index=59&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=22&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Capital%20Structure) The Group maintained robust liquidity during the reporting period, with its gearing ratio significantly decreasing to **29.2%** as of June 30, 2024, cash and cash equivalents substantially increasing to **HKD 428 million**, and net current assets rising to **HKD 411 million**, while its capital structure remained largely unchanged since listing Key Financial Position Indicators (As of June 30, 2024) | Indicator | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Gearing Ratio** | 29.2% | 42.3% | | **Cash and Cash Equivalents** | 427.6 Million HKD | 236.0 Million HKD | | **Net Current Assets** | 411.4 Million HKD | 374.5 Million HKD | | **Interest-bearing Bank Borrowings** | 493.5 Million HKD | 415.6 Million HKD | - The gearing ratio is calculated as net debt divided by (equity attributable to owners of the company + net debt), with its decrease indicating an improvement in the Group's financial leverage[64](index=64&type=chunk) Corporate Governance/Other Information [Corporate Governance and Compliance](index=24&type=section&id=Corporate%20Governance%20and%20Compliance) The Group maintains high corporate governance standards, complying with all applicable Code provisions during the period, with the temporary exception of board gender diversity due to a non-executive director's resignation, which the company plans to rectify by August 31, 2024, and all directors adhered to securities dealing standards - Due to the resignation of Ms. Ding Shaojian as a non-executive director on June 11, 2024, the company's Board of Directors temporarily does not meet the gender diversity requirements under Listing Rule 13.92[67](index=67&type=chunk)[70](index=70&type=chunk) - The company plans to appoint Ms. Tang Yuk Lai as an independent non-executive director by August 31, 2024, to regain compliance with the Listing Rules[67](index=67&type=chunk)[70](index=70&type=chunk) - The company's Audit Committee has reviewed the unaudited interim condensed consolidated financial information for the six months ended June 30, 2024[73](index=73&type=chunk)[75](index=75&type=chunk) [Directors' and Substantial Shareholders' Interests](index=26&type=section&id=Directors%27%20and%20Substantial%20Shareholders%27%20Interests) This section discloses the interests of the company's directors, chief executive, and substantial shareholders in the company's shares as of June 30, 2024, noting Chairman Mr. Guan Manyu holds **0.50%**, and the controlling shareholder, CR Construction Investment Limited, holds **72.23%**, ultimately controlled by Zhejiang Provincial State-owned Capital Operation Co., Ltd Directors' Shareholdings (As of June 30, 2024) | Director Name | Capacity | Number of Shares Held | Approximate Percentage of Shareholding (%) | | :--- | :--- | :--- | :--- | | Mr. Guan Manyu | Beneficial Owner | 2,500,000 | 0.50 | | Mr. Li Ka Yin | Beneficial Owner | 1,000,000 | 0.20 | | Mr. Chan Tak Yiu | Beneficial Owner | 100,000 | 0.02 | | Mr. Yang Haojiang | Beneficial Owner | 500,000 | 0.10 | - Substantial shareholder Zhejiang Provincial State-owned Capital Operation Co., Ltd. indirectly holds **361,150,000** shares, representing **72.23%** of the total share capital, through a series of controlled entities[82](index=82&type=chunk)[84](index=84&type=chunk) [Share Option Scheme](index=30&type=section&id=Share%20Option%20Scheme) The company adopted a Share Option Scheme on September 17, 2019, valid until 2029, with a maximum of **50,000,000** shares available for options, aiming to incentivize contributors, and no options have been granted, exercised, expired, or lapsed since its adoption to date - The Share Option Scheme aims to attract and retain talent, with eligible participants including employees, directors, consultants, and business partners[86](index=86&type=chunk) - No share options have been granted or exercised since the scheme's adoption to the reporting date, and as of June 30, 2024, the company had no outstanding share options[89](index=89&type=chunk)[91](index=91&type=chunk) Independent Review Report [Independent Review Report](index=33&type=section&id=Independent%20Review%20Report) This section presents the independent review report by Ernst & Young, Certified Public Accountants, on the Group's interim financial information for the six months ended June 30, 2024, concluding that nothing came to their attention suggesting the information was not prepared in all material respects in accordance with HKAS 34 - The scope of a review is substantially less than an audit, thus the auditor does not express an audit opinion[94](index=94&type=chunk)[95](index=95&type=chunk) - Based on the review, the auditor found no material matters indicating that the interim financial information was not prepared as required[96](index=96&type=chunk)[97](index=97&type=chunk) Interim Condensed Consolidated Financial Statements [Interim Condensed Consolidated Statement of Profit or Loss](index=35&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2024, the Group reported revenue of **HKD 2.773 billion**, gross profit of **HKD 188 million**, profit for the period of **HKD 36.22 million**, with **HKD 35.85 million** attributable to owners of the company, and basic earnings per share of **7.17 HK cents** H1 2024 Statement of Profit or Loss Summary | Item | Amount (Thousand HKD) | | :--- | :--- | | Revenue | 2,773,188 | | Gross profit | 188,062 | | Profit Before Tax | 49,869 | | Profit for the Period | 36,220 | | Profit Attributable to Owners of the Company | 35,845 | | Basic Earnings Per Share | 7.17 HK cents | [Interim Condensed Consolidated Statement of Financial Position](index=36&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2024, the Group's total assets were **HKD 4.239 billion**, total liabilities **HKD 3.587 billion**, and net assets **HKD 652 million**, with net current assets of **HKD 411 million** indicating robust short-term solvency Financial Position Summary (As of June 30, 2024) | Item | Amount (Thousand HKD) | | :--- | :--- | | **Total Non-current Assets** | 350,952 | | **Total Current Assets** | 3,887,915 | | **Total Assets** | **4,238,867** | | **Total Current Liabilities** | 3,476,514 | | **Total Non-current Liabilities** | 110,702 | | **Total Liabilities** | **3,587,216** | | **Net Assets** | **651,651** | [Interim Condensed Consolidated Statement of Cash Flows](index=41&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) In H1 2024, the Group generated **HKD 224 million** net cash from operating activities, a significant improvement from a **HKD 425 million** net outflow in the prior year, with net cash outflows of **HKD 2.06 million** from investing and **HKD 29.31 million** from financing activities, resulting in a **HKD 193 million** net increase in cash and cash equivalents, ending the period at **HKD 428 million** Cash Flow Statement Summary (H1 2024) | Item | Amount (Thousand HKD) | | :--- | :--- | | Net Cash Flows from Operating Activities | 223,999 | | Net Cash Flows (Used in) Investing Activities | (2,058) | | Net Cash Flows (Used in) Financing Activities | (29,313) | | **Net Increase in Cash and Cash Equivalents** | **192,628** | | **Cash and Cash Equivalents at End of Period** | **427,626** | [Notes to Interim Condensed Consolidated Financial Information](index=46&type=section&id=Notes%20to%20Interim%20Condensed%20Consolidated%20Financial%20Information) The financial statement notes detail accounting policies, segment information, revenue composition, and related party transactions, highlighting the Group's two operating segments—construction and environmental—with construction as the primary revenue source, and providing breakdowns of revenue by type, geography, and recognition timing, alongside disclosures of various transactions and balances with the holding company and fellow subsidiaries - The Group has two reportable operating segments: (i) Construction Business (in Hong Kong, Malaysia, and the UK) and (ii) Environmental Business (in China), with management separately monitoring their performance for decision-making purposes[118](index=118&type=chunk) Segment Revenue and Results (H1 2024) | Segment | Revenue (Thousand HKD) | Segment Results (Thousand HKD) | | :--- | :--- | :--- | | Construction Business | 2,704,868 | 65,794 | | Environmental Business | 68,320 | 8,056 | | **Total** | **2,773,188** | **73,850** | - The Group engages in various related party transactions with its intermediate holding company and fellow subsidiaries, including consulting service fees, interest expenses, material purchases, and subcontracting service fees[172](index=172&type=chunk) - As of June 30, 2024, the Group had loans from its intermediate holding company and fellow subsidiaries totaling approximately **HKD 196 million**, with some being interest-bearing[174](index=174&type=chunk)[175](index=175&type=chunk)

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) For the six months ended June 30, 2024, the Group's total revenue slightly decreased to HKD 2.77 billion, while gross profit significantly increased to HKD 188.1 million, though profit attributable to owners declined to approximately HKD 35.8 million, with the Board resolving to declare an interim dividend of HKD 1.5 cents per share Financial Performance Summary | Metric | Six Months Ended June 30, 2024 (Million HKD) | Six Months Ended June 30, 2023 (Million HKD) | Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | 2,773.2 | 2,832.1 | -2.1% | | **Gross Profit** | 188.1 | 150.5 | +25.0% | | **Profit Attributable to Owners** | 35.8 | 45.5 | -21.3% | - The Board has resolved to declare an interim dividend of **HKD 1.5 cents per share**[1](index=1&type=chunk) [Interim Financial Statements](index=2&type=section&id=Interim%20Financial%20Statements) [Interim Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) During the reporting period, revenue was HKD 2.77 billion, a slight decrease of 2.1% year-on-year, while gross profit increased by 25.0% to HKD 188.06 million due to effective cost control, but profit for the period decreased by 21.2% to HKD 36.22 million, with basic earnings per share at HKD 7.17 cents Interim Condensed Consolidated Statement of Profit or Loss | Item | Six Months Ended June 30, 2024 (Thousand HKD) | Six Months Ended June 30, 2023 (Thousand HKD) | | :--- | :--- | :--- | | **Revenue** | 2,773,188 | 2,832,073 | | **Gross Profit** | 188,062 | 150,480 | | **Administrative Expenses** | (98,612) | (80,890) | | **Profit Before Tax** | 49,869 | 54,818 | | **Profit for the Period** | 36,220 | 45,954 | | **Profit Attributable to Owners of the Company** | 35,845 | 45,457 | | **Basic Earnings Per Share** | 7.17 HK cents | 9.09 HK cents | [Interim Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) During the reporting period, total comprehensive income for the period decreased from HKD 27.49 million in the prior period to HKD 25.80 million, primarily due to an exchange difference loss of HKD 10.42 million arising from the translation of overseas operations - Other comprehensive loss for the period from exchange differences on translation of overseas operations was **HKD 10.42 million** (compared to a loss of HKD 18.47 million in the prior period)[3](index=3&type=chunk) - Total comprehensive income for the period was **HKD 25.80 million**, a decrease from **HKD 27.49 million** in the prior period[3](index=3&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2024, the Group's total assets were HKD 4.24 billion, total liabilities were HKD 3.59 billion, and net assets increased to HKD 652 million, with net current assets improving from HKD 374 million to HKD 411 million, indicating enhanced liquidity Interim Condensed Consolidated Statement of Financial Position | Item | June 30, 2024 (Thousand HKD) | December 31, 2023 (Thousand HKD) | | :--- | :--- | :--- | | **Total Non-current Assets** | 350,952 | 353,693 | | **Total Current Assets** | 3,887,915 | 3,777,662 | | **Total Current Liabilities** | 3,476,514 | 3,403,201 | | **Net Current Assets** | 411,401 | 374,461 | | **Total Non-current Liabilities** | 110,702 | 93,305 | | **Net Assets** | 651,651 | 634,849 | [Notes to the Interim Condensed Consolidated Financial Information](index=6&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) [Operating Segment Information](index=7&type=section&id=3.%20Operating%20Segment%20Information) The Group's operations are divided into two main segments: construction and environmental protection, with construction remaining the core business, contributing 97.5% of revenue and 89.1% of segment results, while environmental protection revenue decreased by 40.5% year-on-year, leading to a reduction in its segment results Segment Performance | Segment | Revenue (Thousand HKD) | Segment Results (Thousand HKD) | | :--- | :--- | :--- | | **Construction Business** | 2,704,868 | 65,794 | | **Environmental Protection Business** | 68,320 | 8,056 | | **Total** | 2,773,188 | 73,850 | - The Construction Business segment primarily engages in building construction and RMAA works in Hong Kong, Malaysia, and the United Kingdom[12](index=12&type=chunk) - The Environmental Protection Business segment is involved in the construction and operation of wastewater treatment and related facilities in Mainland China[12](index=12&type=chunk) [Revenue and Other Income](index=9&type=section&id=4.%20Revenue%20and%20Other%20Income) Total revenue primarily derived from contracts with customers, with building construction works being the largest contributor, and Hong Kong market accounting for over 84% of revenue by geographical segment, while other income significantly increased due to HKD 5.7 million in insurance compensation received Revenue by Type | Revenue Type | Amount (Thousand HKD) | | :--- | :--- | | **Building Construction Works** | 2,414,268 | | **RMAA Works** | 290,600 | | **Environmental Protection Business** | 62,892 | | **Total Revenue from Contracts with Customers** | 2,767,760 | Revenue by Geographical Market | Geographical Market | Amount (Thousand HKD) | | :--- | :--- | | **Hong Kong** | 2,329,939 | | **United Kingdom** | 320,994 | | **Mainland China** | 62,892 | | **Malaysia** | 53,935 | - Other income amounted to **HKD 6.95 million**, primarily comprising **HKD 5.7 million** in insurance compensation[17](index=17&type=chunk) [Finance Costs](index=13&type=section&id=6.%20Finance%20Costs) Finance costs significantly increased by 55.3% year-on-year to HKD 29.68 million, primarily due to higher interest on bank borrowings and interest on discounting amounts due from retention monies Finance Costs Breakdown | Item | Six Months Ended June 30, 2024 (Thousand HKD) | Six Months Ended June 30, 2023 (Thousand HKD) | | :--- | :--- | :--- | | **Interest on bank borrowings** | 17,161 | 10,865 | | **Interest on discounting amounts due from retention monies** | 9,988 | 3,208 | | **Total** | 29,677 | 19,109 | [Dividends](index=14&type=section&id=8.%20Dividends) The Board declared an interim dividend of HKD 1.5 cents per share for the six months ended June 30, 2024, consistent with the prior period, and the final dividend of HKD 1.8 cents per share for 2023 was paid in July 2024 - A proposed interim dividend of **HKD 1.5 cents per share**[64](index=64&type=chunk) - The Board declared an interim dividend of **HKD 1.5 cents per ordinary share**, consistent with the prior period (HKD 1.5 cents), totaling **HKD 7.5 million**[24](index=24&type=chunk) - The final dividend for 2023 of **HKD 9 million** (HKD 1.8 cents per share) was paid on July 26, 2024[24](index=24&type=chunk) [Management Discussion and Analysis](index=19&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Outlook](index=19&type=section&id=Business%20Review%20and%20Outlook) The Group maintains a leading position in its core construction business with 47 ongoing projects totaling HKD 28.5 billion in contracts, emphasizing technological innovation with HKD 11.6 million invested in R&D and its proprietary '4S Smart Site Safety System' achieving ISO 27001 certification, while anticipating positive impacts from Hong Kong's stable economic development, the imported labor scheme, and amendments to the compulsory sale for redevelopment ordinance - As of June 30, 2024, the Group had **47 ongoing projects** with original contract sums totaling approximately **HKD 28.5 billion**[34](index=34&type=chunk) - During the reporting period, the Group was awarded **9 new projects** with original contract sums totaling approximately **HKD 4.1 billion**[34](index=34&type=chunk) - The Group prioritizes technological innovation, with total R&D expenditure of approximately **HKD 11.6 million** during the reporting period, and its self-developed '4S Smart Site Safety System' successfully obtained ISO 27001 certification[37](index=37&type=chunk) - Looking ahead to the second half of the year, the imported labor scheme is expected to alleviate talent shortages, and amendments to the compulsory sale ordinance are anticipated to promote redevelopment projects, bringing positive impacts to the Group's business[38](index=38&type=chunk) [Financial Review](index=22&type=section&id=Financial%20Review) This period's financial performance is characterized by a slight revenue decrease, gross profit growth, and net profit decline, with total revenue down 2.1% to HKD 2.77 billion primarily due to reduced environmental protection business and building construction works revenue, while gross margin improved from 5.3% to 6.8% driven by significant improvement in RMAA works gross profit, but increased administrative expenses and expected credit loss provisions for receivables led to a 21.3% decline in net profit to HKD 36.2 million [Revenue](index=22&type=section&id=Revenue) Total revenue decreased by 2.1% year-on-year, with building construction works revenue slightly down by 1.7%, RMAA works revenue up by 11.2%, and environmental protection business revenue significantly declining by 40.5% Revenue by Business Segment | Business Segment | Six Months Ended June 30, 2024 (Million HKD) | Six Months Ended June 30, 2023 (Million HKD) | Change | | :--- | :--- | :--- | :--- | | **Building Construction Works** | 2,414.3 | 2,455.9 | -1.7% | | **RMAA Works** | 290.6 | 261.4 | +11.2% | | **Environmental Protection Business** | 68.3 | 114.8 | -40.5% | | **Total Revenue** | 2,773.2 | 2,832.1 | -2.1% | [Gross Profit and Gross Margin](index=23&type=section&id=Gross%20Profit%20and%20Gross%20Margin) The Group's overall gross margin significantly improved from 5.3% to 6.8%, primarily driven by the RMAA works segment, which saw its gross margin reverse from -0.5% to 14.9%, while building construction works gross margin slightly decreased and environmental protection business gross margin increased - RMAA works gross profit turned from a loss of **HKD 1.4 million** in the prior period to a profit of **HKD 43.2 million**, with its gross margin increasing from **-0.5% to 14.9%**[46](index=46&type=chunk) - Environmental protection business gross margin increased from **18.5% to 26.6%**, but the gross profit amount decreased due to reduced revenue from high-margin construction and rehabilitation services[47](index=47&type=chunk) [Expenses and Profit](index=24&type=section&id=Expenses%20and%20Profit) Net profit declined primarily due to several expense changes: administrative expenses increased due to higher staff costs and R&D investment; other operating items shifted from net income to net expenses in the prior period, mainly due to a HKD 17.7 million provision for expected credit losses on receivables; finance costs rose due to increased interest rates; and income tax expense increased due to higher non-deductible expenses - Administrative expenses increased from **HKD 80.9 million** to **HKD 98.6 million**, primarily due to higher staff costs, bank charges, and R&D expenses[49](index=49&type=chunk) - Net other operating expenses amounted to **HKD 16.9 million**, compared to income of HKD 2.1 million in the prior period, mainly due to a **HKD 17.7 million** provision for expected credit losses on receivables[50](index=50&type=chunk) - Net profit decreased by **21.3%** from **HKD 46 million** to **HKD 36.2 million**[53](index=53&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=26&type=section&id=Liquidity,%20Financial%20Resources%20and%20Capital%20Structure) The Group maintains a robust financial position with ample liquidity, as cash and cash equivalents significantly increased to HKD 428 million at the end of the reporting period, and the gearing ratio substantially decreased from 42.3% at the end of last year to 29.2%, indicating reduced financial leverage Key Financial Metrics | Metric | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Cash and Cash Equivalents** | 427.6 Million HKD | 236.0 Million HKD | | **Net Current Assets** | 411.4 Million HKD | 374.5 Million HKD | | **Gearing Ratio** | 29.2% | 42.3% | | **Interest-bearing Bank Borrowings** | 493.5 Million HKD | 415.6 Million HKD | - The Group pledged receivables and contract assets with a net book value of **HKD 184 million** under service concession arrangements to banks to finance loans in China[61](index=61&type=chunk) [Corporate Governance and Other Information](index=28&type=section&id=Corporate%20Governance%20and%20Other%20Information) [Dividends and Share Registrar](index=28&type=section&id=Dividends%20and%20Share%20Registrar) The Board recommended an interim dividend of HKD 1.5 cents per share, payable on or about September 30, 2024, with the share register to be closed from September 5 to September 9, 2024, to determine dividend entitlements - A proposed interim dividend of **HKD 1.5 cents per share**[64](index=64&type=chunk) - The share register will be closed from **September 5 to September 9, 2024** (both dates inclusive)[65](index=65&type=chunk) [Compliance and Review](index=28&type=section&id=Compliance%20and%20Review) The Company complied with all applicable code provisions of the Corporate Governance Code during the reporting period, and the interim results were reviewed by the Company's auditor in accordance with Hong Kong Standard on Review Engagements 2410 and by the Company's Audit Committee - The Company has complied with all applicable code provisions set out in the Corporate Governance Code during the reporting period[66](index=66&type=chunk) - The unaudited interim condensed consolidated financial information has been reviewed by the Company's auditor and by the Company's Audit Committee[69](index=69&type=chunk)

Financial Performance - The Group's revenue for the year was approximately HK$5.4 billion, with a profit attributable to owners of the Company of approximately HK$71.9 million[12]. - The Group's total revenue decreased by approximately HK$963.8 million or approximately 15.0%, from approximately HK$6,409.4 million for the year ended December 31, 2022, to approximately HK$5,445.6 million for the Reporting Period[61]. - Revenue from building construction works decreased by approximately HK$292.3 million or approximately 5.9%, from approximately HK$4,995.3 million to approximately HK$4,703.0 million during the Reporting Period[62]. - Revenue from RMAA works decreased by approximately HK$742.6 million or approximately 58.4%, from approximately HK$1,271.3 million to approximately HK$528.7 million for the Reporting Period[63]. - Revenue from environmental operations increased by approximately HK$71.1 million or approximately 49.8%, from approximately HK$142.8 million to approximately HK$213.9 million during the Reporting Period[64]. - The Group's gross profit increased from approximately HK$256.5 million to approximately HK$306.0 million, with gross profit margins rising from approximately 4.0% to approximately 5.6%[72]. - Net profit decreased by approximately HK$0.7 million, or 1.0%, from approximately HK$72.9 million to about HK$72.2 million, with net profit margins of approximately 1.1% and 1.3% for the respective years[91]. Project Development - The Group was awarded 15 new projects in 2023, with an aggregate original contract sum of approximately HK$6.0 billion[12]. - The Group had 44 projects on hand with an aggregate original contract sum of approximately HK$27.5 billion as of December 31, 2023[32]. - The Group completed 19 projects with an aggregate original contract sum of approximately HK$4.3 billion during the reporting period[32]. - The Sha Tin data centre development project set a new record for individual engineering contract value for the Group[12]. - The Group had 17 projects in the environmental operation business with an aggregate original contract sum of approximately HK$0.3 billion[13]. - ZCIEE's first project in soil remediation and restoration was the Qinglan Park project in Yuhuan City, marking a new business growth opportunity[13]. Acquisitions and Business Expansion - The acquisition of Zhejiang Construction Investment Environment Engineering Company Limited (ZCIEE) expanded the Group's business into environmentally friendly construction and related areas[13]. - The acquisition of ZCIEE in May 2023 is expected to diversify the Group's business into environmental improvement and protection related construction services[37]. - The Acquisition was completed on 8 May 2023, with ZCIEE becoming a wholly-owned subsidiary, contributing to the Group's cash flow and profitability[105]. - The Group plans to further expand its presence in overseas markets, particularly in Malaysia and the United Kingdom[23]. Operational Efficiency and Technology - The Group's self-developed "CR Smart Site Safety System" integrates various technologies for real-time site monitoring, enhancing safety supervision[18]. - The Group aims to deepen its diversified development strategy by enhancing local technology R&D and smart site technologies[23]. - The Group's total expenditure for research and development was approximately HK$17.5 million, focusing on technological innovation in construction safety[45]. Awards and Recognition - The Group received multiple industry awards, including the Most Outstanding Award for Construction Engineering Services of the Year at the HKCT Business Awards 2023[17]. - The Group received a total of 53 honours during the reporting period, including the "Most Outstanding Construction Engineering Service of the Year" award[35]. Financial Management and Capital Structure - The gearing ratio as of 31 December 2023 was approximately 42.3%, significantly higher than 6.6% in 2022, indicating increased leverage[118]. - The Group reported net current assets of approximately HK$374.5 million as of 31 December 2023, down from approximately HK$618.7 million in the previous year[120]. - Cash and cash equivalents increased to approximately HK$236.0 million as of 31 December 2023, up by approximately HK$77.8 million from approximately HK$158.2 million in 2022[120]. - Interest-bearing bank borrowings amounted to approximately HK$415.6 million as of December 31, 2023, up from HK$197.2 million in 2022[126]. - The group maintains conservative cash and financial management policies, frequently reviewing liquidity and financing requirements[128]. Talent Management and Workforce - The Group plans to strengthen talent management through diversified training programs and development opportunities for staff[23]. - The total number of employees increased to 906 as of December 31, 2023, with total staff costs rising to approximately HK$464.7 million from about HK$419.0 million in the previous year[93]. - The Group is enhancing the utilization of the Labour Importation Scheme to address talent shortages in the construction industry[48]. Governance and Leadership - The company emphasizes the importance of independent judgment on strategy, performance, resources, and conduct standards from its independent non-executive directors[167]. - The board includes members with diverse backgrounds in law, finance, and construction, enhancing strategic decision-making capabilities[172]. - The management team is committed to maintaining high standards of governance and operational efficiency[177]. - The company has a strong governance structure with independent non-executive directors actively participating in key committees[183].

Financial Performance - Total revenue for the year ended December 31, 2023, decreased to approximately HKD 5,445.6 million, down from HKD 6,409.4 million for the year ended December 31, 2022[2] - Gross profit increased to approximately HKD 306.0 million for the year ended December 31, 2023, compared to HKD 256.5 million for the year ended December 31, 2022[2] - Profit attributable to equity holders of the company for the year ended December 31, 2023, was approximately HKD 71.9 million, slightly down from HKD 72.1 million for the year ended December 31, 2022[2] - Total comprehensive income for the year ended December 31, 2023, was HKD 62.1 million, compared to HKD 37.4 million for the year ended December 31, 2022[5] - The company reported a basic and diluted earnings per share of HKD 0.1438 for the year ended December 31, 2023, compared to HKD 0.1442 for the year ended December 31, 2022[4] - The net profit for the year ending December 31, 2022, was revised to HKD 72,940 thousand, compared to the previously reported HKD 56,532 thousand, representing a growth of approximately 28.98%[14] - The group recorded a net profit of HKD 72,225,000 for the year, slightly down from HKD 72,940,000 in 2022, a decrease of 1%[34] - Net profit decreased by approximately HKD 0.7 million or 1.0% to about HKD 72.2 million, with net profit margin rising from 1.1% to 1.3%[89] Assets and Liabilities - Non-current assets increased to HKD 353.7 million as of December 31, 2023, from HKD 274.7 million as of December 31, 2022[7] - Current assets rose to HKD 3,777.7 million as of December 31, 2023, compared to HKD 3,300.3 million as of December 31, 2022[7] - Total liabilities increased to HKD 3,403.2 million as of December 31, 2023, from HKD 2,681.6 million as of December 31, 2022[7] - Total assets as of December 31, 2023, amounted to HKD 4,131,355,000, an increase from HKD 3,574,979,000 in 2022[36] - Total liabilities increased to HKD 3,496,506,000 from HKD 2,741,224,000, marking a rise of 27.6%[36] - The total equity after the acquisition was revised to HKD 833,755 thousand, up from HKD 569,092 thousand, reflecting a significant increase of approximately 46.5%[19] Dividends - The board proposed a final dividend of HKD 0.018 per share, totaling approximately HKD 9.0 million[2] - The company plans to maintain a final dividend of HKD 1.8 cents per share, unchanged from the previous year[53] - The board proposed a final dividend of HKD 0.018 per share for the reporting period, consistent with the previous year[108] Acquisitions - The acquisition of Zhejiang Construction Environmental Engineering Co., Ltd. was completed on May 8, 2023, for a consideration of approximately HKD 228.4 million[11] - The acquisition of Zhejiang Construction Environmental Group has been accounted for under the merger accounting principles, impacting the consolidated financial statements for the years ending December 31, 2023, and December 31, 2022[12] - The group completed the acquisition of Zhejiang Construction Environmental Protection for a consideration of RMB 201 million (approximately HKD 228.4 million) on May 8, 2023, enhancing its capabilities in wastewater and recycled water treatment services[94] Revenue Segments - The construction segment generated revenue of HKD 5,231,681,000, down from HKD 6,266,589,000, representing a decline of 16.5%[34] - The environmental segment reported revenue of HKD 213,879,000, an increase of 49.8% from HKD 142,840,000 in the previous year[34] - Revenue from building construction projects decreased by approximately HKD 292.3 million or 5.9% to about HKD 4,703.0 million due to reduced income from new and existing projects[75] - Revenue from RMAA projects decreased by approximately HKD 742.6 million or 58.4% to about HKD 528.7 million, primarily due to existing projects nearing completion[76] - Revenue from environmental business increased by approximately HKD 71.1 million or 49.8% to about HKD 213.9 million, driven by new projects and existing services[77] Expenses - Administrative expenses increased from approximately HKD 150.4 million to about HKD 173.0 million, mainly due to higher employee costs and R&D expenses[85] - Financing costs increased from approximately HKD 20.3 million to about HKD 52.6 million, attributed to rising interbank rates and additional borrowings[87] - Income tax expenses increased by approximately HKD 3.8 million or 42.7% to about HKD 12.7 million, mainly due to the utilization of tax losses in the previous year[88] Employee and Talent Management - As of December 31, 2023, the group had a total of 906 employees, an increase from 883 employees as of December 31, 2022, with total employee costs (excluding directors' remuneration) amounting to approximately HKD 464.7 million, up from HKD 419.0 million in 2022[91] - The company plans to strengthen the use of labor import programs to address the shortage of technical talent in the construction industry[72] Financial Reporting and Governance - The financial statements were prepared in accordance with Hong Kong Financial Reporting Standards[23] - The group adopted new and revised Hong Kong Financial Reporting Standards during the year, including HKFRS 17 on insurance contracts[28] - The company has adhered to the corporate governance code since its listing and will continue to review its governance practices[112] - The audit committee, chaired by an independent non-executive director, oversees the appointment and remuneration of external auditors and monitors financial reporting[116] - The company’s auditor confirmed that the preliminary announcement of the consolidated financial statements aligns with the figures in the annual financial report[117] Future Outlook and Projects - The company has 44 ongoing projects with a total original contract value of approximately HKD 27.5 billion as of December 31, 2023[65] - During the reporting period, the company secured 15 new projects with an original contract value of approximately HKD 6 billion and completed 19 projects valued at approximately HKD 4.3 billion[65] - The company has been awarded 4 new projects post-December 31, 2023, including 3 building construction contracts valued at approximately HKD 96.4 million and 1 RMAA contract valued at approximately HKD 599 million[69] Risk Management - The group continues to monitor foreign exchange risks closely, given its operations in multiple currencies including RMB, HKD, MYR, and GBP, although it currently has no foreign currency hedging policy in place[100] - The average credit period for trade payables is between 30 to 180 days, with a financial risk management policy in place to ensure timely repayments[59]

Business Performance - The total revenue for the Group for the six months ended June 30, 2023, decreased to approximately HK$2,832.1 million, compared to approximately HK$2,919.9 million for the same period in 2022, reflecting a decrease of about 3%[33]. - The total gross profit increased to approximately HK$150.5 million for the six months ended June 30, 2023, up from approximately HK$135.8 million for the same period in 2022, representing an increase of about 10%[34]. - Profit attributable to owners of the Company for the six months ended June 30, 2023, amounted to approximately HK$45.5 million, compared to approximately HK$41.5 million for the same period in 2022, marking an increase of about 10%[35]. - Revenue for the six months ended June 30, 2023, was HK$2,832,073,000, a decrease of 3.0% from HK$2,919,864,000 in the same period of 2022[197]. - Gross profit increased to HK$150,480,000, up 10.7% from HK$135,756,000 year-over-year[197]. - Profit for the period attributable to owners of the Company was HK$45,457,000, an increase of 9.6% from HK$41,460,000 in the same period last year[197]. Project Acquisition and Development - The Group was awarded a total of 6 new projects during the Reporting Period, generating revenue of approximately HK$2,832 million and a net profit of approximately HK$45.50 million[14]. - The successful acquisition of Zhejiang Construction Investment Environment Engineering Company Limited (ZCIEE) represents an expansion into new business areas, specifically environmental improvement and protection-related construction services[14]. - The Group plans to continue capitalizing on new development opportunities arising from Hong Kong's integration into the overall development of the country, with local construction tenders expected to grow due to large-scale projects like "Lantau Tomorrow" and "Northern Metropolis"[25]. - The Group's acquisition of ZCIEE is expected to expand its business presence and enhance profitability, contributing to environmental protection and ecological conservation in the PRC[25]. - During the Reporting Period, the Group was awarded 6 new projects with an aggregate original contract sum of approximately HK$0.4 billion and completed 9 projects totaling approximately HK$1.5 billion[42]. Financial Management and Costs - The Group's contract costs decreased by approximately HK$102.5 million or approximately 3.7% to approximately HK$2,681.6 million for the Reporting Period[73][77]. - Administrative expenses increased by approximately HK$8.5 million to approximately HK$80.9 million, mainly due to higher professional service fees incurred during the Reporting Period[83]. - Finance costs increased by approximately HK$11.1 million to approximately HK$19.1 million, attributed to the rise in HIBOR and additional borrowings[90]. - Income tax expenses rose by approximately HK$3.5 million or approximately 63.6% to approximately HK$8.9 million, with effective tax rates of approximately 16.2% for the Reporting Period[91]. Market Conditions and Economic Outlook - The economic recovery in the PRC and Hong Kong has been positive, although cost pressures have increased alongside this recovery[15]. - The construction industry in Hong Kong continues to face various impacts due to the changing economic environment post-pandemic[15]. - The Group anticipates that economic activities in Hong Kong will return to normal levels in the second half of 2023, although cost pressures are expected to increase[52]. Sustainability and Innovation - The Group is actively pursuing a sustainable development strategy and enhancing its diversified development[14]. - The Group's self-developed Digital Works Supervision System ("DWSS"), SmarTick Pro, obtained the ISO27001 Certification for Information Security Management System, making it the first company in Hong Kong to achieve this certification for DWSS[21]. - The Group aims to strengthen talent management by providing diversified training plans and development opportunities to enhance employee promotion mechanisms[26]. - The Group will deepen its diversified development strategy, focusing on innovative technologies such as smart construction sites and expanding its upstream and downstream development through investments and mergers[26]. Shareholder Information - An interim dividend of HK1.5 cents per share has been declared for shareholders, with the payment date set for September 12, 2023[36]. - The Board recommended an interim dividend of HK1.5 cents per ordinary share, down from HK2.5 cents in the previous period[101]. - As of June 30, 2023, the company had a total of 500,000,000 issued shares[162]. - The total number of shares held by substantial shareholders indicates a strong control over the company, with 72.23% held by a single entity[165].

Financial Performance - Revenue for the year was approximately HK$6.3 billion, with a net profit of approximately HK$56.5 million[11]. - The Group's total revenue increased by approximately HK$1,376.5 million or approximately 28.1%, from approximately HK$4,890.1 million in 2021 to approximately HK$6,266.6 million in 2022[43][48]. - Revenue from building construction works rose by approximately HK$880.0 million or approximately 21.4%, from approximately HK$4,115.3 million in 2021 to approximately HK$4,995.3 million in 2022[44][49]. - Revenue from RMAA works surged by approximately HK$496.5 million or approximately 64.1%, from approximately HK$774.8 million in 2021 to approximately HK$1,271.3 million in 2022[45][50]. - Net profit increased by approximately HK$7.9 million, or about 16.3%, to approximately HK$56.5 million, with net profit margins of approximately 1.0% and 0.9% for the years ended December 31, 2021, and 2022, respectively[66]. Project Development - The Group was awarded 24 new projects in 2022, including 2 in Malaysia and 1 in the UK[11]. - The aggregate original contract sum reached approximately HK$9.7 billion, a record high for the Group[11]. - The Kai Tak public housing development project set a new record for the value of individual engineering contracts[11]. - The Group won 2 Modular Integrated Construction (MiC) projects during the reporting period, including 1 public MiC project[12]. - As of December 31, 2022, the Group had 48 projects on hand with an aggregate original contract sum of approximately HK$25.7 billion, up from 37 projects totaling HK$17.4 billion in the previous year[26]. Market Expansion - The Group expanded its operations in the UK market through investments and acquisitions while consolidating its presence in Malaysia[11]. - The Group intends to further expand its overseas market, particularly in Malaysia and the UK[19]. - The outlook for 2023 is expected to be more stable with the resumption of pre-COVID normalcy, although skilled labor shortages may continue to drive up project costs[29]. Operational Challenges - The construction industry in Hong Kong is facing challenges such as structural manpower shortages and rising wages, which are increasing project costs[19]. - The Group's contract costs increased by approximately HK$1,333.7 million or approximately 28.3%, from approximately HK$4,712.3 million in 2021 to approximately HK$6,046.0 million in 2022[52][57]. Sustainability and Governance - The Group actively promoted sustainable development and improved its environmental, social, and governance management[16]. - The Group's strategy focused on brand-building and a people-oriented approach to mitigate the impacts of the COVID-19 pandemic[16]. - The Company is committed to high standards of corporate governance to safeguard shareholder interests and enhance corporate value[190]. Leadership and Management - The company has a strong leadership team with extensive experience in the construction sector, enhancing its operational capabilities[130][136][143]. - The Group's senior management team includes professionals with extensive backgrounds in construction and engineering, ensuring strong operational oversight[169]. - The management team is committed to maintaining high standards of quality management across all projects, which is critical for client satisfaction and project delivery[171]. Financial Management - The company continues to manage its financial position prudently and maintains a conservative cash and financial management policy[107]. - The gearing ratio as of December 31, 2022, was approximately 14.9%, a decrease from approximately 16.4% in 2021[93]. - The group maintained a healthy liquidity position, with cash and cash equivalents increasing to approximately HK$93.3 million from approximately HK$69.1 million in 2021[95]. Future Outlook - The Group anticipates rapid growth in the construction business in the second half of 2023, increasing business opportunities[33]. - The company provided guidance for the next fiscal year, projecting revenue growth of A% and an expected EBITDA margin of B%[147]. - Future outlook remains positive, with management expressing confidence in achieving K% growth in the upcoming quarters[147].

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分內容而產生或因倚賴該等內容而引致的任何損 失承擔任何責任。 CR Construction Group Holdings Limited 華 營 建 築 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：1582） 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度 之 全 年 業 績 公 告 財務摘要 截至二零二二年十二月三十一日止年度本集團的總收益增加至約6,266.6 百萬港元，而截至二零二一年十二月三十一日止年度本集團的總收益 為約4,890.1百萬港元（經重列）。 截至二零二二年十二月三十一日止年度本集團的總毛利增加至約220.6 百萬港元，而截至二零二一年十二月三十一日止年度本集團的總毛利 則為約177.8百萬港元（經重列）。 截至二零二二年十二月三十一日止年度本公司權益持有人應佔溢利約 ...