Huayu Expressway Group Limited 華昱高速集團有限公司 ( 於開曼群島註冊成立的有限公司) 股份代號: 1823 2019 年 報 目錄 目錄 公司資料 2 財務概要 3 主席報告 4 管理層討論與分析 5 企業管治報告 12 董事及高級管理層 23 董事會報告書 25 獨立核數師報告 37 綜合損益表 45 綜合損益及其他全面收益表 46 綜合財務狀況表 47 綜合權益變動表 49 綜合現金流量表 50 財務報表附註 51 1 華昱高速集團有限公司 公司資料 公司資料 1823 | --- | --- | |--------------------------------------------|------------------------------------------------------------| | | | | 董事會 | 香港主要營業地點 | | 執行董事 | 香港 | | 陳陽南 （主席） 麥慶泉 （行政總裁） 符捷頻 | 金鐘道 89 號 力寶中心 一座 12 樓 | | 獨立非執行董事 | 1205 室 | | 孫小年 朱健宏 胡列格 | 開曼群島股 ...

Revenue and Profitability - For the six months ended June 30, 2019, Huayu Expressway Group Limited reported revenue of approximately HKD 202.1 million, an increase of about 92.8% compared to HKD 104.8 million in the same period last year, primarily due to rapid growth in the liquor trading business [17]. - Revenue for the six months ended June 30, 2019, was HKD 202,080,000, a 93% increase from HKD 104,775,000 in the same period of 2018 [72]. - Gross profit for the period was approximately HKD 95.8 million, an increase of 41.5% from HKD 67.7 million in the previous year, with a gross profit margin of about 47.4% [19]. - Gross profit for the same period was HKD 95,754,000, up 41.3% from HKD 67,730,000 year-on-year [72]. - The group recorded a profit of approximately HKD 30.9 million for the period, a significant increase of 40.5% compared to HKD 22 million in the same period last year, mainly due to the new liquor trading business [26]. - Operating profit increased to HKD 70,459,000, representing a 27.2% rise from HKD 55,371,000 in the previous year [72]. - Profit before tax was HKD 42,481,000, a 61.4% increase compared to HKD 26,312,000 in 2018 [72]. - Net profit for the period was HKD 30,884,000, up 40.5% from HKD 21,992,000 in the same period last year [72]. - The company reported an adjusted EBITDA of HKD 92,372,000 for the six months ended June 30, 2019, up from HKD 84,725,000 in 2018, reflecting an increase of about 9.7% [149]. Toll Revenue and Traffic - Toll revenue from the Suiyue Expressway (Hunan section) was approximately HKD 95 million, a decrease of 9.4% from HKD 104.8 million in the same period last year, influenced by enhanced control over overweight trucks and maintenance work completed in December 2018 [17]. - The average toll fee per vehicle decreased by 26.5% to approximately HKD 16.6, while the average monthly traffic volume increased by 23.5% to approximately 956,000 vehicles [17]. - The average monthly traffic on the Yue Highway (Hunan section) increased significantly from approximately 774,000 vehicles to approximately 956,000 vehicles during the reporting period [35]. - The toll revenue decreased by approximately 9.4% to about HKD 95,000,000, with the average toll per vehicle dropping by 26.5% to approximately HKD 16.6 [35]. Financial Position and Cash Flow - Total bank loans drawn as of June 30, 2019, amounted to approximately HKD 972 million, down from HKD 1,015.8 million as of December 31, 2018 [27]. - Cash and cash equivalents totaled approximately HKD 232.1 million, significantly up from HKD 43.3 million as of December 31, 2018 [27]. - The group recorded cash flow of approximately HKD 394,000,000 after monetizing the 30% interest in the highway, significantly enhancing liquidity [41]. - Operating cash generated from activities was HKD 58,351,000, a decrease of 39.4% compared to HKD 96,299,000 in the previous year [103]. - Net cash generated from operating activities was HKD 56,659,000, down from HKD 96,299,000, reflecting a significant decline [103]. - The net increase in cash and cash equivalents was HKD 192,048,000, compared to HKD 13,633,000 in the prior period, showing strong cash flow performance [103]. - The group completed the sale of a 30% stake in a subsidiary, generating net proceeds of HKD 394,012,000, aimed at improving cash flow and reducing debt [108]. Expenses and Costs - Administrative expenses rose by 57.5% to approximately HKD 20 million, primarily due to increased employee costs related to the expressway operations and new liquor trading business [23]. - Interest expenses for the six months ended June 30, 2019, were HKD 31,245,000, compared to HKD 29,059,000 in 2018, showing an increase of approximately 7.5% [145]. - The group recognized a total tax expense of HKD 11,597,000 for the six months ended June 30, 2019, compared to HKD 4,320,000 for the same period in 2018, indicating a significant increase of 168.5% [156]. Employee and Compensation - As of June 30, 2019, the total employee compensation expenditure was approximately HKD 21,100,000, an increase from approximately HKD 11,100,000 in 2018 [30]. - As of June 30, 2019, the group employed a total of 291 employees, an increase from 285 employees as of December 31, 2018 [30]. Capital Management and Debt - The group maintained a prudent capital management policy and actively managed its liquidity position to meet operational and future development funding needs [27]. - The controlling shareholder has committed to not demanding repayment of advances until at least December 31, 2020, ensuring continued financial support for operations [111]. - The company has no violations of financial covenants as of June 30, 2019, maintaining compliance with all credit facility agreements [179]. - The group's primary task in capital management is to ensure its ongoing viability while balancing higher shareholder returns with reasonable borrowing levels, maintaining a net debt-to-equity ratio of 296% as of January 1, 2019, unchanged from December 31, 2018 [197]. Accounting and Reporting Standards - The company adopted the revised retrospective method for the first application of HKFRS 16 on January 1, 2019, which may impact future financial reporting [89]. - The company assessed that the adoption of HKFRS 16 did not have a significant impact on its financial performance compared to HKAS 17 [128]. - The company has not restated comparative figures due to the adoption of the new accounting standard, which may affect the comparability of financial results [89]. - The group adopted a revised retrospective approach to apply Hong Kong Financial Reporting Standard 16, recognizing most operating lease assets and corresponding lease liabilities from January 1, 2019 [197]. Shareholder Information - The company did not declare an interim dividend for the six months ended June 30, 2019, consistent with the previous year [194]. - The total number of issued and fully paid ordinary shares remained at 412,608,000, with a par value of HKD 0.01 per share [182]. - The company has a share-based compensation reserve amounting to HKD 5,684,000 as of June 30, 2019, reflecting the fair value of restricted shares granted [190].

Financial Performance - The company reported a profit of approximately HKD 86.7 million for the year ended December 31, 2018, a significant increase compared to previous years[31]. - Revenue for the year ended December 31, 2018, was approximately HKD 204,500,000, an increase of 22.5% from approximately HKD 166,900,000 for the year ended December 31, 2017[36]. - The company's profit attributable to shareholders for the year ended December 31, 2018, was HKD 76,580,000, a significant increase from HKD 15,845,000 in 2017[151]. - Gross profit increased by approximately 23.0% to HKD 129,000,000 for the year ended December 31, 2018, from HKD 104,900,000 for the previous year[38]. - Toll revenue rose to approximately HKD 202.1 million, despite a 9.9% decrease in average toll fee per vehicle to HKD 21.8[31]. - Toll revenue for the highway increased by 21.1% to HKD 202.1 million for the year ending December 31, 2018, despite a decrease in average toll per vehicle from HKD 24.2 to HKD 21.8[57]. Traffic and Operations - Average monthly traffic on the expressway reached about 774,000 vehicles, a 34.4% increase from approximately 576,000 vehicles in the previous year[31]. - The highway in Hunan experienced a significant increase in traffic volume, reaching approximately 774,000 vehicles per month by the end of 2018, marking a historical high[57]. - Future traffic flow on the expressway is expected to increase significantly as it connects with the entire highway network in Hunan Province[31]. - The company’s operations are highly sensitive to traffic volume, which is influenced by various factors including connections to local and national highway networks[132]. Strategic Initiatives - The company plans to expand into the alcohol and spirits trade, aiming to establish a nationwide sales and distribution network[32]. - The company is focused on building its brand in the alcohol sector, which is anticipated to become a significant division in the near future[32]. - The company aims to explore opportunities in other infrastructure projects in China, leveraging its successful experience and established relationships[65]. - The company has established a single distribution agreement for the sale of Huamao liquor in China, leveraging its relationship with Guizhou Moutai Group[61]. Corporate Governance - The board of directors has established and reviewed corporate governance policies, including training and continuous professional development for directors and senior management[74]. - The company has a diversity policy for board members, ensuring a range of skills and experiences are represented, including gender, age, cultural background, and industry experience[84]. - The audit committee consists of three independent non-executive directors, with Mr. Zhu Jianhong serving as the chairman[92]. - All independent non-executive directors have confirmed their independence according to the listing rules, ensuring compliance with governance standards[73]. - The board has defined the roles of the chairman and the CEO, with the chairman leading the board in strategy formulation and the CEO managing daily operations[76][77]. Financial Management - The total amount of bank loans drawn as of December 31, 2018, was approximately HKD 1,015,800,000, down from HKD 1,143,600,000 in the previous year[47]. - The company relies on financial support from banks and its controlling shareholder to meet operational costs and financial obligations, indicating significant uncertainty regarding its ability to continue as a going concern[134]. - The company has adopted a dividend policy, with the board having full discretion to declare and recommend dividends based on financial performance and future business plans[113]. - The board regularly reviews and evaluates the dividend policy based on financial performance, business operations, and capital requirements[113]. Employee and Compensation - The total employee count increased to 285 by the end of 2018, with total employee compensation expenses rising to approximately HKD 24.4 million[62]. - Total contributions to the retirement plan for the year ended December 31, 2018, amounted to HKD 3,662,000, an increase from HKD 2,929,000 in 2017[175]. Risk Management - The company is assessing the potential impairment of intangible assets related to service concession arrangements, particularly focusing on traffic control policies and competition from alternative routes, which may adversely affect toll revenue growth[190]. - The board's risk management and internal control systems were deemed effective and adequately implemented during the year[107]. - The internal audit department is composed of professionals with relevant expertise, such as certified accountants, and operates independently from the group's daily operations[108]. Compliance and Reporting - The independent auditor's report confirms that the consolidated financial statements reflect the group's financial position as of December 31, 2018, in accordance with Hong Kong Financial Reporting Standards[185]. - The audit committee reviewed the consolidated financial statements for the year ended December 31, 2018, ensuring the adoption of appropriate accounting principles and practices[93]. - The company has complied with applicable environmental protection standards and legal regulations during its operations[141].