COVID-19 Impact and Recovery - The company faced significant impacts on its performance due to the COVID-19 pandemic, particularly in the construction sector, which was one of the hardest hit industries in Singapore [7]. - Despite the challenges, the company is optimistic about a rebound in 2021, supported by over SGD 300 million in project contracts [9]. - The company plans to expand its local market share while also attempting to restart overseas business initiatives that were postponed due to the pandemic [9]. - The management has taken proactive measures to mitigate risks and is preparing for potential uncertainties in the future [9]. - The company anticipates that productivity and demand in the construction industry will improve as the pandemic is brought under control [8]. - The company is committed to achieving a V-shaped recovery in its operational performance in 2021 [9]. - The government of Singapore has announced a vaccination timeline, which is expected to facilitate a return to normalcy in the construction sector [8]. - The company aims to strengthen its position in 2021 to reverse the poor performance of 2020, provided that COVID-19 does not resurge [47]. Financial Performance - The group’s revenue for the fiscal year decreased by 31.56%, from approximately SGD 215.5 million to approximately SGD 147.5 million due to the pandemic and circuit breaker measures [29]. - Gross profit fell by approximately 98.0%, from about SGD 25.96 million to SGD 0.402 million, with a gross margin decline of 11.78 percentage points to 0.27% [29]. - Other income increased by over SGD 6 million, primarily due to government subsidies to help businesses cover pandemic-related costs [30]. - Administrative expenses rose from approximately SGD 8.4 million to SGD 12.9 million, an increase of about SGD 4.5 million, mainly due to additional costs incurred during the shutdown [31]. - The company recorded a net loss after tax of approximately SGD 4.6 million, a decrease of SGD 19.4 million or about 131% compared to the previous period [33]. - The current ratio improved from 2.3 to 2.6, indicating a stable liquidity position [36]. - The debt-to-equity ratio increased from 11.8% to 20.2%, primarily due to temporary transitional loans provided by the Singapore government [37]. Project and Contract Updates - The company completed S$147 million in contract works during the fiscal year, down from S$215 million in the previous period [26]. - The company secured three new projects with a total contract value of S$179 million, compared to S$186 million in the previous period [26]. - The order book remains at a high level of S$356 million, supported by two large projects (REC and HDB C6) despite a decrease in new projects [26]. - The company is actively participating in tenders for new projects, with several large industrial projects expected to be awarded in Q1 2021 [26]. - The company successfully obtained a temporary occupancy permit for the North London Collegiate School, allowing operations to commence in January 2021 [26]. - The project completion date has been delayed to September 2021 due to COVID-19, with an expected increase in final construction costs [154]. Workforce and Employee Management - The company faced a 15% reduction in workforce due to COVID-19, significantly impacting project progress [25]. - Total employee costs for the fiscal year were approximately SGD 26 million, down from SGD 29 million in the previous year [45]. - The group employed 1,081 employees as of October 31, 2020, including foreign workers [44]. Corporate Governance - The board held four meetings during the fiscal year, including the approval of the annual performance announcement and the interim performance report for the six months ending April 30, 2020 [58]. - All directors attended 100% of the board meetings, with attendance recorded as 4/4 for each of the five active directors [60]. - The company adopted a board diversity policy, emphasizing the importance of diverse skills, experiences, and perspectives among board members [61]. - The audit committee, established on April 19, 2018, consists of three independent non-executive directors and is responsible for reviewing the integrity of financial statements and overseeing risk management [66][67]. - The company has committed to providing ongoing professional development for directors, ensuring they are well-informed about their responsibilities and the company's operations [60]. - The chairman and CEO roles are held by the same individual, Mr. Wang Yingde, which is noted as a deviation from corporate governance guidelines [63]. - The company has established four board committees to monitor various aspects of governance, including an audit committee and a remuneration committee [65]. Environmental and Social Responsibility - The company emphasizes ethical responsibility in its operations and has implemented measures to reduce environmental pollution [122]. - The company has a compliance program in place to adhere to applicable laws and regulations in Singapore, Cayman Islands, and Hong Kong [123]. - The company is committed to sustainable building practices, adhering to local environmental regulations and implementing green policies [193]. - The company has established an Environment, Health, and Safety (EHS) committee at all project sites to ensure compliance with environmental policies [190]. - The company actively monitors energy consumption data to prevent waste in construction projects [200]. - The company has set up annual environmental awareness activities involving all stakeholders to promote eco-friendly practices [190]. Shareholder and Capital Management - The company did not recommend any final dividend for the fiscal year [112]. - As of October 31, 2020, the company's distributable reserves were SGD 69.777 million in share premium and a cumulative loss of SGD (5.351) million [119]. - The company has maintained its capital development and operational balance in its dividend policy [101]. - The company will review its dividend policy periodically and may update it as deemed appropriate [103]. Risk Management - The board is responsible for assessing and determining the nature and extent of risks the company is willing to take to achieve strategic objectives [88]. - The company has engaged Virtus Assure Pte Ltd to review the effectiveness of its internal controls, with no significant concerns identified that could impact financial, operational, compliance, or risk management [91]. - The company has implemented monitoring procedures to ensure strict prohibition against unauthorized access and use of insider information [94].

Financial Performance - For the six months ended April 30, 2020, the company's revenue decreased by 19.55% to approximately SGD 91.46 million from about SGD 113.7 million in the previous period[10]. - Gross profit for the same period fell by approximately 49.0%, from about SGD 14.42 million to SGD 7.36 million, with a gross margin decline of 3.93 percentage points to 8.75%[10]. - The company recorded a net profit after tax of approximately SGD 4.15 million, a decrease of about 55.6% compared to the previous period[15]. - Revenue for the six months ended April 30, 2020, was SGD 91,462 thousand, a decrease of 19.5% compared to SGD 113,690 thousand in 2019[58]. - Gross profit for the six months ended April 30, 2020, was SGD 7,360 thousand, down 48.9% from SGD 14,423 thousand in 2019[58]. - Profit before tax decreased to SGD 4,259 thousand, a decline of 62.7% from SGD 11,408 thousand in the previous year[58]. - Net profit for the period was SGD 4,150 thousand, representing a 55.7% decrease from SGD 9,351 thousand in 2019[58]. - Basic and diluted earnings per share were both SGD 0.3, down from SGD 0.6 in the same period last year[58]. Order Book and Future Outlook - The order book value as of April 30, 2020, stood at SGD 373.9 million, bolstered by two significant contracts worth a total of SGD 254.14 million secured at the end of 2019[6]. - The company holds a robust order book valued at SGD 373.9 million, indicating a cautious optimism for future operations despite current challenges[34]. - The Singapore construction market is projected to improve by 0.5% to 2.5% year-on-year in 2020, although the impact of the pandemic has led to significant disruptions[30]. - The construction industry in Singapore is expected to face a contraction of 10.3% in 2020 due to the pandemic's effects[30]. Expenses and Costs - Administrative expenses increased to SGD 4.86 million, up from approximately SGD 3.74 million, primarily due to additional costs incurred during the shutdown period[13]. - Total materials, subcontractors, and other construction costs were SGD 72,528,000, a reduction of 17.0% from SGD 87,334,000 in 2019[95]. - The total employee cost for the six months ended April 30, 2020, was approximately SGD 14 million, consistent with the previous year[28]. Government Support and Financial Management - Other income rose by approximately SGD 873,000, mainly due to government grants provided to assist businesses with costs arising from the pandemic[11]. - The company has actively utilized government financial support programs during the circuit breaker measures to manage labor costs[31]. - Government grants received increased significantly to SGD 1,125,000 from SGD 162,000 in the previous year, reflecting support for employment and mechanization[93]. Liquidity and Financial Ratios - The current ratio as of April 30, 2020, was 2.4, compared to 2.6 as of October 31, 2019, indicating a stable liquidity position[18]. - As of April 30, 2020, the company's debt-to-equity ratio was 13.0%, a slight decrease from 13.9% on October 31, 2019, primarily due to term loans[19]. - Cash and cash equivalents rose significantly to SGD 48,296 thousand, compared to SGD 31,186 thousand in 2019, marking a 54.8% increase[59]. - Operating cash flow for the six months was SGD 18,287 thousand, a substantial increase from SGD 4,042 thousand in the previous year[63]. Corporate Governance and Management - The company did not declare any interim dividends for the period ended April 30, 2020[16]. - The company has adopted and complied with all applicable provisions of the corporate governance code, except for the separation of roles between the chairman and the CEO[40]. - The board of directors currently consists of two executive directors and three independent non-executive directors following the resignation of an independent director on April 11, 2020[51]. Assets and Liabilities - Total assets increased to SGD 175,356 thousand from SGD 160,378 thousand, reflecting a growth of 9.8%[60]. - The company’s liabilities decreased slightly to SGD 55,074,000 as of April 30, 2020, from SGD 56,460,000 a year earlier[75][78]. - Total reported segment assets as of April 30, 2020, were SGD 93,638,000, a decrease of 10.6% from SGD 104,825,000 as of October 31, 2019[84]. - Total reported segment liabilities increased to SGD 55,074,000 as of April 30, 2020, up 23.2% from SGD 44,699,000 as of October 31, 2019[88]. Trade Receivables and Payables - Trade receivables increased to SGD 64,785 thousand from SGD 59,408 thousand, an increase of 9.4%[59]. - The aging analysis of trade receivables showed that amounts overdue but not impaired totaled SGD 17,193,000 for over one year as of April 30, 2020[117]. - Trade payables decreased from SGD 14,477,000 as of October 31, 2019, to SGD 11,214,000 as of April 30, 2020, representing a reduction of approximately 22.5%[135]. Capital Expenditures and Investments - The company incurred capital expenditures of SGD 767,000, significantly lower than SGD 15,104,000 in the same period of 2019[64]. - The company did not sell any properties, plant, or equipment during the six months ended April 30, 2020, compared to SGD 39,000 in the previous year[64]. - The net book value of property, plant, and equipment as of April 30, 2020, was SGD 17,330,000, an increase from SGD 16,905,000 as of October 31, 2019[104]. Strategic Initiatives - The company is focusing on digital transformation initiatives to mitigate the impact of COVID-19 and enhance operational efficiency[7]. - The company is expanding into public housing and large design projects, aiming to establish itself as a leading contractor in Singapore[6]. - The company is considering digital transformation in response to the pandemic, which includes worker management initiatives[45].

Company Performance - The company achieved outstanding performance despite a challenging year, with a focus on developing new project types to respond to market fluctuations [8]. - The company is optimistic about steady growth in 2020, supported by a solid track record and experienced management team [9]. - The company successfully launched its first real estate development project during the fiscal year, marking a significant step towards diversified operations [8]. - The company plans to expand its local market share while making significant progress in overseas business attempts in the coming year [9]. Financial Overview - The group's overall profit margin increased slightly from 10.8% for the fiscal year ending October 31, 2018, to 12.0% for the current fiscal year [25]. - The construction division's profit margin decreased from 9.9% to 9.6%, while the civil engineering division's profit margin rose significantly from 23.7% to 38.4% [24]. - The group's revenue decreased by 5.7% compared to the fiscal year ending October 31, 2018, but gross profit increased by 1.2% [27]. - The general construction division contributed 91.4% of the group's revenue and 72.8% of gross profit, while the civil engineering division contributed 8.6% of revenue and 27.2% of gross profit [27]. - The group recorded a profit attributable to owners of SGD 1.1 million growth compared to the fiscal year ending October 31, 2018 [26]. - The company's profit attributable to owners increased by approximately SGD 1.1 million, representing a growth of about 8% compared to the fiscal year ending October 31, 2018 [31]. Market Conditions - The construction industry in Singapore remains sluggish, with intense competition in project bidding impacting overall market conditions [8]. - The construction market in Singapore remains competitive, with continuous downward pressure on bid prices [24]. - The economic growth forecast for Singapore in 2020 is between 0.5% to 2.5%, which is expected to positively impact construction demand [42]. Shareholder and Management Relations - The company expressed gratitude to shareholders, directors, executives, and employees for their contributions to the group's development [9]. - The management team is committed to creating value for employees and delivering greater returns to shareholders in the new year [9]. - The company does not recommend any dividend for the fiscal year to maintain competitiveness and ensure sufficient operating cash flow [32]. - The company maintains a dividend policy balancing sufficient capital development and rewarding shareholders, considering factors such as financial performance and operational funding needs [94]. Governance and Board Structure - The board of directors consists of six members, with independent non-executive directors making up 66.7% of the board [50]. - The board held a total of five meetings during the reporting period, including discussions on significant financial matters and project approvals [54]. - All independent non-executive directors confirmed their independence according to the guidelines set out in the listing rules [51]. - The company has adopted a board diversity policy, emphasizing the importance of diverse skills, experiences, and perspectives among board members [57]. - The company has established a nomination committee to review and recommend candidates for board appointments [58]. Risk Management and Compliance - The board is responsible for risk management and internal control systems, which are designed to manage risks rather than eliminate them [82]. - The company has established a risk management policy that includes identification, assessment, and management procedures for key business risks [83]. - The company has established compliance procedures to ensure adherence to applicable laws and regulations in Singapore, the Cayman Islands, and Hong Kong [115]. Environmental and Social Responsibility - The company has implemented comprehensive safety policies to protect employee health and safety, aiming for zero occupational health and safety incidents [152]. - The company is committed to sustainable building practices, focusing on user safety and minimizing environmental impact during construction and operation [171]. - The company has established an Environment, Health, and Safety (EHS) committee and environmental control officers at all project sites to oversee and enforce environmental policies [174]. - The company has adopted energy-efficient practices, ensuring that all office equipment is energy-saving and automatically shuts down when not in use [178]. Project and Operational Highlights - The company secured six additional projects with a total contract value of approximately SGD 208.5 million, contributing to a robust order book of SGD 442.4 million [43]. - The company has made significant progress in undertaking institutional projects, including constructing international schools and high-end corporate offices [24]. - The company has become a leading contractor in building food industry facilities after completing four food industrial plant construction projects [24].

HPC HOLDINGS LIMITED 執行董事 王應德先生 （主席兼行政總裁） 施建華先生 （首席運營官） （於開曼群島註冊成立之有限公司） 股份代號: 1742 中期報告 2019 目錄 | 公司資料 | 2 | | --- | --- | | 管理層討論及分析 | 4 | | 企業管治及其他資料 | 14 | | 中期財務資料審閱報告 | 17 | | 中期簡明綜合全面收益表 | 19 | | 中期簡明綜合財務狀況表 | 20 | | 中期簡明綜合權益變動表 | 22 | | 中期簡明綜合現金流量表 | 23 | | 簡明綜合中期財務資料附註 | 25 | HPC HOLDINGS LIMITED | 2019中期報告 公司資料 董事會及其他委員會 獨立非執行董事 朱東先生 梁偉業先生 吳敬慧女士 翁敦廉先生 審核委員會 梁偉業先生 （主席） 朱東先生 吳敬慧女士 薪酬委員會 朱東先生 （主席） 王應德先生 吳敬慧女士 提名委員會 王應德先生 （主席） 朱東先生 吳敬慧女士 工作場所安全與健康委員會 翁敦廉先生 （主席） 施建華先生 林文秀先生 （於二零一九年六月十四日辭任） 何 含女士 （於二零一九 ...

Financial Performance - The group experienced revenue growth compared to the previous year, but faced reduced gross margins due to intense bidding competition and high construction costs in the local market[9]. - The company's revenue increased by 13.7% from approximately SGD 201.1 million to about SGD 228.6 million for the fiscal year[28]. - Gross profit decreased by 38.0%, dropping from approximately SGD 39.8 million to around SGD 24.7 million due to a 26.5% rise in sales costs[28]. - The profit margin fell from 19.8% in the previous fiscal year to 10.8% in the current fiscal year[26]. - The net profit attributable to the company's owners decreased by 49.8%, from approximately SGD 27.3 million to about SGD 13.7 million[32]. - Operating profit for the year was SGD 16.61 million, down from SGD 33.51 million in the previous year, indicating a decrease of approximately 50.5%[183]. - Net profit attributable to owners of the company was SGD 13.72 million, compared to SGD 27.32 million in 2017, a decline of around 49.7%[183]. - Basic and diluted earnings per share decreased to SGD 1.0 from SGD 2.3, reflecting a drop of approximately 56.5%[183]. - The company reported a total comprehensive income of SGD 27,324 thousand for the year ended October 31, 2018, compared to SGD 13,715 thousand in 2017, marking an increase of approximately 99.0%[190]. Market Outlook - For 2019, the Singapore construction market is expected to gradually recover, and the company is optimistic about achieving steady growth based on its past performance and current project contracts[10]. - The company anticipates a significant reduction in the number of projects awarded due to the ongoing challenges in the construction market[25]. - The company anticipates continued volatility in the Singapore construction market, influenced by global economic conditions and trade tensions[49]. Strategic Initiatives - The company plans to expand its local market share while also exploring overseas business opportunities and diversifying into real estate development projects to strengthen its market risk resilience[10]. - The company successfully secured four new projects post-fiscal year-end, with a total contract value of approximately SGD 166.4 million[49]. - The company acquired a 51% stake in Regal Haus Pte. Ltd. for SGD 510,000, aimed at redeveloping a property into a commercial building[43]. Governance and Compliance - The board consists of six members, with independent non-executive directors making up 66.7% of the board[56]. - All independent non-executive directors have confirmed their independence according to the listing rules, ensuring compliance since the company's listing date[56]. - The company has established a corporate governance policy adopted on April 19, 2018, which is disclosed in the prospectus dated April 27, 2018[79]. - The company has established a comprehensive onboarding process for new directors to ensure understanding of their responsibilities and the company's operations[58]. - The company has a robust governance framework in place, with the board overseeing business strategies and financial matters[55]. Financial Position - As of October 31, 2018, the current ratio was 2.2, compared to 1.8 on October 31, 2017, indicating strong liquidity management[34]. - The debt-to-equity ratio was 0.1% as of October 31, 2018, down from 0.2% in the previous year, suggesting low leverage[35]. - Total assets increased to SGD 139.00 million in 2018 from SGD 123.77 million in 2017, representing a growth of about 12.2%[185]. - Total equity attributable to owners of the company rose to SGD 79.11 million in 2018 from SGD 62.46 million in 2017, an increase of approximately 26.6%[185]. - Cash and cash equivalents decreased to SGD 23.71 million in 2018 from SGD 27.79 million in 2017, a decline of about 14.5%[185]. Employee and Operational Insights - The total employee costs for the fiscal year amounted to approximately SGD 27.5 million, an increase from SGD 23.2 million in the previous year[46]. - As of October 31, 2018, the company had 929 employees, including foreign workers, reflecting its operational scale[45]. - The company has maintained a focus on internal controls to ensure the accuracy of financial reporting and compliance with relevant regulations[174]. Shareholder Information - The company did not recommend the declaration of a final dividend for the fiscal year[33]. - The company maintains a balance between sufficient capital development and rewarding shareholders in its dividend policy[100]. - The remuneration policy for employees is determined by the remuneration committee based on performance and market data, with the share option plan serving as an incentive[153]. Risks and Challenges - The construction industry in Singapore contracted by 2.2% year-on-year in Q4 2018, continuing a decline of 2.5% in Q3 2018[24]. - The company has no significant foreign exchange risk as most revenues and expenses are denominated in Singapore dollars[36]. - Each department is tasked with identifying and assessing major risks quarterly and developing mitigation plans to manage identified risks[88].