Financial Performance - For the fiscal year ending December 31, 2020, Wenye Group Holdings Limited reported a revenue of RMB 1,247.6 million, a decrease of 19.9% compared to the previous year[13]. - The decline in revenue was primarily due to the COVID-19 pandemic, which led to project delays and shortages of labor and materials in the first half of 2020[13]. - The company recorded a net profit attributable to shareholders of approximately RMB 21.1 million for the year ended December 31, 2020[30]. - The gross profit decreased from approximately RMB 186.9 million in 2019 to approximately RMB 148.6 million in 2020, a decline of about 20.5%[35]. - The company's revenue decreased from approximately RMB 1,557.9 million in 2019 to approximately RMB 1,247.6 million in 2020, a decline of about 19.9% due to COVID-19 related disruptions[30]. - Profit before tax for 2020 was RMB 32,525 thousand, down 45% from RMB 59,340 thousand in 2019[62]. - The group's profit attributable to owners decreased by 47.0% from approximately RMB 39.8 million for the year ended December 31, 2019, to approximately RMB 21.1 million for the year ended December 31, 2020; adjusted profit was approximately RMB 33.3 million, down about 36.9% from approximately RMB 52.8 million for the previous year[43]. Project and Contract Information - The group undertook 432 new projects with a total contract value of RMB 1,649.3 million in the fiscal year[14]. - As of December 31, 2020, the group had 272 ongoing projects with an uncompleted contract value of RMB 1,077.2 million[14]. - The total contract value of projects signed in 2020 was approximately RMB 1,649.3 million, with 432 projects signed[30]. Market Outlook - The construction decoration market in China is expected to rebound strongly after the pandemic, despite temporary setbacks[17]. - The group plans to innovate its business model in response to post-pandemic industry changes and actively seize emerging market opportunities[16]. - The group aims to maintain its traditional market base while expanding into new channels following the stabilization of the pandemic[16]. Financial Management and Strategy - The financial management strategy is overseen by the CFO, Mr. Wan, who has over 13 years of experience in financial management[67]. - The company is exploring new strategies for market expansion and product development to enhance its competitive position[63]. - The group has allocated approximately HKD 131.1 million for capital needs and cash flow, with 61.2% already utilized[93]. Corporate Governance - The board of directors consists of eight members, including three executive directors, two non-executive directors, and three independent non-executive directors[172]. - The board is responsible for strategic planning, major investment decisions, and overseeing the company's operational and financial performance[170]. - The audit committee, composed of three independent non-executive directors, reviewed the financial reporting procedures and internal controls[160]. - The company has adopted a standard code of conduct for securities trading, ensuring all directors complied with the required standards during the reporting period[167]. Employee and Operational Information - The group had a total of 366 employees as of December 31, 2020, down from 429 employees in the previous year, resulting in a reduction of approximately 14.7%[147]. - Employee costs for the year, including director remuneration, amounted to approximately RMB 40.5 million, a decrease of about 22.8% from RMB 52.4 million in 2019[147]. - Sales and marketing expenses increased from approximately RMB 8.4 million for the year ended December 31, 2019, to approximately RMB 9.9 million for the year ended December 31, 2020, representing a growth of 17.9% due to an increase in employee numbers and salary levels following business expansion[40]. Risk Management - The group faced major risks and uncertainties during the year, which are discussed in the annual report[84]. - The company has implemented a robust internal control and risk management system to safeguard its operations[170]. Shareholder Information - Mr. Fan Shaozhou holds 173,905,150 shares, representing 29.28% of the issued share capital[125]. - The major shareholder, China Merchants Yonglong Trust Co., Ltd., holds 193,255,150 shares, accounting for 32.53% of the issued share capital[131]. - The company has no significant transactions or contracts involving directors or major shareholders as of the end of the fiscal year[122]. Dividend Policy - The board did not recommend the distribution of a final dividend for the year ended December 31, 2020[57]. - The group has a dividend policy that considers financial status, future market outlook, and funding needs before declaring dividends, but there is no guarantee of dividend payments[87].

Revenue and Profitability - The company's revenue decreased from approximately RMB 668.7 million in the first half of 2019 to approximately RMB 301.7 million in the first half of 2020, a decline of about 54.9% due to the COVID-19 pandemic[7]. - Revenue for the six months ended June 30, 2020, was RMB 301,733 thousand, a decrease of 55% compared to RMB 668,736 thousand for the same period in 2019[67]. - Gross profit for the same period was RMB 37,168 thousand, down 52% from RMB 77,555 thousand in 2019[67]. - The company's gross profit decreased from approximately RMB 77.6 million in the first half of 2019 to approximately RMB 37.2 million in the first half of 2020, a decline of about 52.1%[13]. - The group had a profit for the first half of 2020 was a loss of approximately RMB 22.4 million, a decrease of 252.4% compared to a profit of RMB 14.7 million in the first half of 2019[23]. - The company reported a net loss attributable to owners of RMB 22,408,000 for the six months ended June 30, 2020, compared to a profit of RMB 14,980,000 in 2019[109]. - The company reported a basic and diluted loss per share of RMB 0.04 for the six months ended June 30, 2020, compared to earnings of RMB 0.03 per share in 2019[69]. Costs and Expenses - The cost of sales decreased from approximately RMB 591.2 million in the first half of 2019 to approximately RMB 264.6 million in the first half of 2020, a decline of about 55.2%[12]. - Sales and marketing expenses increased by 33.3% from approximately RMB 3.6 million in the first half of 2019 to approximately RMB 4.8 million in the first half of 2020, driven by business expansion and increased employee costs[18]. - General and administrative expenses decreased by approximately 2.8% from RMB 32.4 million in the first half of 2019 to RMB 31.5 million in the first half of 2020[19]. - Financial and contract asset impairment losses increased by 37.3% from RMB 16.1 million in the first half of 2019 to RMB 22.1 million in the first half of 2020, mainly due to provisions for trade receivables[20]. Cash Flow and Financing - The net cash used in operating activities was RMB (181,814) thousand, compared to RMB (32,491) thousand for the same period in 2019, indicating a significant increase in cash outflow[79]. - The cash flow from financing activities resulted in a net cash inflow of RMB 162,889 thousand for the six months ended June 30, 2020, compared to a net cash outflow of RMB (4,631) thousand for the same period in 2019[79]. - The company raised RMB 142,783 thousand from the issuance of shares during the financing activities in the first half of 2020[79]. - The company’s operating cash flow for the first half of 2020 was significantly impacted by increased operational costs, with cash used in operations rising to RMB (179,163) thousand from RMB (17,960) thousand in the previous year[79]. Assets and Liabilities - Total assets as of June 30, 2020, were RMB 1,710,586 thousand, down from RMB 1,823,038 thousand at the end of 2019[71]. - Total liabilities decreased to RMB 1,127,774 thousand as of June 30, 2020, from RMB 1,348,285 thousand at the end of 2019[73]. - Trade and other receivables decreased by 19.6% from approximately RMB 1,106.2 million as of December 31, 2019, to approximately RMB 889.7 million as of June 30, 2020[24]. - Trade payables decreased from RMB 874,196 thousand as of December 31, 2019, to RMB 615,232 thousand as of June 30, 2020, representing a reduction of approximately 29.5%[123]. Strategic Plans and Market Position - The company plans to continue expanding its strategic customer base and optimize resources in green, technology, and smart building decoration sectors[10]. - The company aims to enhance its core competitiveness in large public construction projects, including airports and high-speed rail[10]. - The company has adopted a partner system to leverage brand and technical advantages for future growth[10]. - The company will closely monitor the development of the COVID-19 pandemic and its impact on operations, ready to implement necessary measures[8]. Corporate Governance and Compliance - The company has complied with all provisions of the corporate governance code, except for the separation of the roles of Chairman and CEO[53][56]. - The company will continue to review and enhance its corporate governance practices to ensure compliance with the corporate governance code[56]. - There were no reported instances of non-compliance with the standard code of conduct for securities trading by directors and relevant employees during the six months ending June 30, 2020[58]. Employee and Management Information - Employee benefit expenses, including director remuneration, were approximately RMB 20.3 million in the first half of 2020, down from RMB 26.8 million in the same period of 2019[48]. - The company employed a total of 375 employees as of June 30, 2020, compared to 469 employees on June 30, 2019[48]. - The total remuneration for key management personnel slightly increased from RMB 1,265 thousand in 2019 to RMB 1,268 thousand in 2020, reflecting a marginal growth of 0.2%[130]. Legal and Contingent Liabilities - The company faced a potential liability of approximately RMB 9,622,000 from a lawsuit involving construction workers, with a court ruling in 2019 ordering payment of RMB 9,347,000, which is currently under appeal[133]. - The company believes it has no obligation to pay the claims made by construction workers, amounting to approximately RMB 9.3 million, due to the absence of a contractual agreement[41]. - The company has appealed a court ruling requiring it to pay approximately RMB 950,000 to a supplier, asserting that it has settled all related payments[41].

Financial Performance - The group's revenue for the year ended December 31, 2019, was RMB 1,557.9 million, an increase of 8.1% compared to 2018, primarily driven by growth in public construction project revenues[12] - The company's revenue for the year ended December 31, 2019, was approximately RMB 1,557.9 million, an increase of 8.1% compared to RMB 1,440.8 million in 2018[31] - The group's revenue increased from approximately RMB 1,440.8 million for the year ended December 31, 2018, to approximately RMB 1,557.9 million for the year ended December 31, 2019, representing a growth of about 8.1%[55] - Gross profit rose from approximately RMB 163.7 million for the year ended December 31, 2018, to approximately RMB 186.9 million for the year ended December 31, 2019, an increase of approximately 14.2%[33] - The net profit for the year decreased by 33.8% from approximately RMB 60.1 million for the year ended December 31, 2018, to approximately RMB 39.8 million for the year ended December 31, 2019[40] - The group recorded other income of approximately RMB 11.8 million for the year ended December 31, 2019, primarily from rental income, government grants, and litigation compensation[34] Project and Contract Management - A total of 384 new projects were undertaken during the year, with a total contract value of RMB 1,559.0 million, and as of December 31, 2019, there were 281 ongoing projects with an uncompleted contract value of RMB 956.0 million[13] - The company signed 384 projects in 2019, with a total contract value (including tax) of RMB 1,559.0 million[28] - As of December 31, 2019, there were 281 ongoing projects, with unrecognized revenue valued at approximately RMB 956.0 million[28] Business Expansion and Strategy - The company plans to actively expand into overseas markets and collaborate strategically with large real estate companies, focusing on residential decoration business[15] - The company plans to optimize its sales network and expand office space to enhance existing branch capabilities[27] - The company aims to recruit more project managers, designers, and R&D personnel to improve service capacity and competitiveness[30] - The company is actively pursuing market expansion and new product development to enhance its competitive edge in the industry[70] - The strategic direction of the company emphasizes innovation and adaptation to market trends, positioning it for future growth[70] Research and Development - The company obtained five utility model patents, one design patent, and one software copyright in 2019, continuing its momentum in research and development[20] Financial Management and Governance - The company has been focusing on financial management strategies, with the CFO overseeing financial operations since 2006, ensuring robust financial health[62] - The board of directors comprises individuals with extensive experience in the decoration and engineering sectors, providing strategic guidance for business development[67] - The company is committed to maintaining high standards of corporate governance and has implemented measures to ensure compliance with applicable laws and regulations[145] - The audit committee reviewed the consolidated financial statements and confirmed they were prepared in accordance with applicable accounting standards and regulations[140] Risk Management - The company emphasizes the importance of internal controls and risk management systems, which were reviewed during the 2019 period[168] - The company is committed to establishing a high-level risk management and internal control system to protect shareholder investments[188] - The risk management system aims to minimize and prevent a range of strategic, operational, financial, and legal risks[188] Shareholder Relations - The company emphasizes the importance of effective communication with shareholders to enhance investor relations and understanding of business performance and strategy[197] - The company encourages shareholders to attend annual general meetings to express opinions and ask questions[197] - Shareholders have the right to propose independent resolutions at the general meeting, which will be voted on according to the Listing Rules[192] Employee Management - The group had a total of 429 employees as of December 31, 2019, down from 533 employees as of December 31, 2018[132] - Employee costs, including director remuneration, amounted to approximately RMB 53.3 million for the year, compared to RMB 52.4 million in 2018[132] Dividend Policy - The company did not recommend any final dividend for the year ended December 31, 2019[85] - The company adopted a general dividend policy on December 21, 2019, to distribute dividends based on the group's profit attributable to shareholders[178] - The board will consider various factors when proposing any dividend payout ratio, including the group's actual and expected financial performance and debt-to-equity ratio[179] - The company has a policy to review its dividend distribution regularly and reserves the right to update or modify this policy at any time[183]