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之內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容 而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 Standard Development Group Limited 標準發展集團有限公司 （於 開 曼 群 島 註 冊 成 立 之 有 限 公 司 ） （股份代號：1867） 獨立非執行董事退任及建議委任 董事會宣佈，於2025年9月5日，(i)梁榮進先生已通知本公司，彼擬於應屆股東週年大會 上退任獨立非執行董事，且不會重選連任；及(ii)嚴兵博士已通知本公司，彼擬於應屆 股東週年大會上退任獨立非執行董事，且不會重選連任。 董事會進一步宣佈，董事會建議於2025年9月5日於股東週年大會上委任趙昌盛先生及徐 兆鴻先生為獨立非執行董事。 獨立非執行董事退任 標準發展集團有限公司（「本公司」，連同其附屬公司統稱「本集團」）董事（「董事」）會（「董 事會」）宣佈，於2025年9月5日，(i)梁榮進先生已通知本公司，經考慮其服務任期已重續、 聯交所的獨立性規定及其決定將更多時間投入個人事務，彼擬於本公司應屆股東 ...

股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年8月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 標準發展集團有限公司 呈交日期: 2025年9月4日 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | | 於香港聯交所上市 (註1) | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01867 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 2,000,000,000 | HKD | | 0.01 | HKD | | 20,000,000 | | 增加 / 減少 (-) | | | | | | | HKD | | | | 本月底結存 | | | 2,000,000,000 | HKD | | 0.01 | HKD | | 20,000,000 | 本月底法定/註冊股本 ...

股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年7月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 標準發展集團有限公司 呈交日期: 2025年8月1日 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | | 於香港聯交所上市 (註1) | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01867 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 2,000,000,000 | HKD | | 0.01 | HKD | | 20,000,000 | | 增加 / 減少 (-) | | | | | | | HKD | | | | 本月底結存 | | | 2,000,000,000 | HKD | | 0.01 | HKD | | 20,000,000 | 本月底法定/註冊股本 ...

Company Information The report details core company information including board members, committee structures, company secretary, auditors, legal advisors, and principal bankers - The report details core company information including board members, committee structures, company secretary, auditors, legal advisors, and principal bankers[6](index=6&type=chunk)[7](index=7&type=chunk) [Chairman's Statement](index=4&type=section&id=Chairman%27s%20Statement) The Chairman's Statement reviews a challenging 2024, highlighting a **38.5% revenue decline** and **153% loss increase** due to strategic shifts towards bioenergy projects, which the Board views as a long-term sustainable growth driver Key Performance Indicators for FY2025 | Indicator | FY2025 | FY2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | Approx. HKD 301.0 million | Approx. HKD 489.8 million | -38.5% | | Loss Attributable to Shareholders | Approx. HKD 50.9 million | Approx. HKD 20.1 million | +153% | - The primary reasons for the performance decline include significant internal capital deployment for organic waste utilization projects, reducing funds for the oil business and causing a substantial revenue drop, alongside decreased revenue from the construction and engineering business due to industry downturns[9](index=9&type=chunk) - Strategic transformation involves the Group investing resources in organic waste comprehensive development and utilization projects (bioenergy) to reduce reliance on construction and engineering businesses, expecting long-term stable returns[9](index=9&type=chunk) - Future outlook indicates the Group will cautiously approach investments in construction and engineering, focusing resources on core prospective businesses, and potentially transitioning to more competitive business models[11](index=11&type=chunk) [Management Discussion and Analysis](index=6&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Outlook](index=6&type=section&id=Business%20Review%20and%20Outlook) The Group recorded a **HKD 50.9 million net loss** this year, primarily from reduced traditional business revenue and increased expenses, while strategically focusing on the bioenergy project, a key Shandong initiative that began contributing profit in Q4, with plans for long-term stable returns - Net loss of approximately **HKD 50.9 million** primarily attributed to (i) decreased revenue from oil and construction businesses; (ii) increased administrative and finance expenses; and (iii) minimal revenue contribution from two bioenergy projects which commenced operations only in the fourth quarter[14](index=14&type=chunk) - Strategic focus shifted: To reduce over-reliance on the construction business, the Group has invested in organic waste comprehensive development and utilization projects (bioenergy business)[14](index=14&type=chunk) - Bioenergy project progress: Designated as a key project in Shandong Province, construction is complete, and it began contributing profits in the fourth quarter of this year, with the company confident in its long-term outcomes[15](index=15&type=chunk) [Key Risks and Uncertainties](index=7&type=section&id=Key%20Risks%20and%20Uncertainties) The Group faces diverse risks, including business challenges like non-recurring contracts and cost control, industry exposures to macroeconomic and energy price volatility, strategic risks from new bioenergy development, and adverse impacts from economic, political, and environmental regulatory changes - Business risks include the non-recurring nature of contracts, reliance on continuous successful bidding, exposure to dispute litigation, significant cost control pressure, and unstable labor supply[20](index=20&type=chunk) - Industry and market risks involve the oil business being affected by geopolitical and macroeconomic factors, and the agricultural business by extreme weather, pests, diseases, and cyclical price fluctuations[20](index=20&type=chunk) - Strategic and policy risks include potential additional capital and operating expenditures from bioenergy business development, and adverse impacts from changes in China's environmental and safety regulations[20](index=20&type=chunk) [Relationships with Customers, Suppliers, Subcontractors, and Employees](index=8&type=section&id=Relationships%20with%20Customers%2C%20Suppliers%2C%20Subcontractors%2C%20and%20Employees) The Group maintains good relationships with key stakeholders, including major contractor and trading company clients, diversified suppliers and subcontractors without significant issues, and employees, providing competitive compensation and benefits while ensuring positive labor relations with no strikes or disputes - Customers primarily consist of main contractors and trading companies[22](index=22&type=chunk) - The Group maintains an approved list of multiple suppliers and subcontractors to avoid over-reliance, encountering no significant difficulties or disputes during the year[23](index=23&type=chunk) - The Group maintains good employee relations, with no strikes or labor disputes affecting operations during the year[26](index=26&type=chunk) [Financial Review](index=9&type=section&id=Financial%20Review) This fiscal year saw a significant decline in financial performance, with total revenue decreasing by **38.5% to HKD 301.0 million**, gross profit plummeting **80% to HKD 0.8 million**, administrative expenses rising **39% to HKD 31.3 million**, and finance costs surging nearly fourfold to **HKD 6.4 million**, collectively expanding the annual loss from **HKD 20.1 million to HKD 50.9 million** Key Income Statement Item Changes for FY2025 | Item | FY2025 (HKD million) | FY2024 (HKD million) | Change Rate | Primary Reason | | :--- | :--- | :--- | :--- | :--- | | Revenue | 301.0 | 489.8 | -38.5% | Decrease in oil trading and construction business | | Direct Costs | 300.3 | 486.0 | -38.2% | In line with revenue decline | | Gross Profit | 0.8 | 3.8 | -80.0% | Decrease in revenue | | Administrative and Other Operating Expenses | 31.3 | 22.5 | +39.1% | Depreciation of bioenergy plant and increased salaries | | Finance Costs | 6.4 | 1.3 | +392.3% | Increased borrowings | | Loss for the Year | 50.9 | 20.1 | +153.2% | Decreased revenue and increased expenses | - Impairment losses under the expected credit loss model amounted to **HKD 4.1 million**, primarily from provisions for retention receivables and trade receivables[30](index=30&type=chunk) [Liquidity, Financial Resources, and Capital Structure](index=10&type=section&id=Liquidity%2C%20Financial%20Resources%2C%20and%20Capital%20Structure) As of March 31, 2025, the Group's financial position tightened, with total assets increasing to **HKD 380.6 million** but total liabilities surging to **HKD 277.3 million**, reducing shareholders' equity to **HKD 94.6 million**; interest-bearing borrowings doubled to **HKD 187.6 million**, the current ratio dropped from **1.2x to 1.0x**, and the gearing ratio sharply rose from **48.8% to 181.7%** due to increased borrowings, while the Group maintains a prudent treasury policy, pledging assets for financing Financial Position and Ratio Changes (as of March 31) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Total Assets | 380.6 HKD million | 291.7 HKD million | | Total Liabilities | 277.3 HKD million | 137.3 HKD million | | Shareholders' Equity | 94.6 HKD million | 144.8 HKD million | | Interest-bearing Borrowings and Lease Liabilities | 187.6 HKD million | 75.3 HKD million | | Current Ratio | 1.0x | 1.2x | | Gearing Ratio | 181.7% | 48.8% | - The gearing ratio (total borrowings and lease liabilities/total equity) significantly increased, primarily due to the rise in total borrowings during the year[38](index=38&type=chunk)[39](index=39&type=chunk) - As of March 31, 2025, the Group pledged approximately **HKD 6.0 million** in bank deposits, approximately **HKD 3.5 million** in life insurance policies, and two leased land plots with a carrying value of approximately **HKD 23.5 million** to secure bank financing[42](index=42&type=chunk)[43](index=43&type=chunk) [Significant Transactions and Events](index=12&type=section&id=Significant%20Transactions%20and%20Events) During the year, the Group experienced several significant transactions and events, including the lapse of a convertible bond placement, disclosure of three litigation cases with one settled for **HKD 1.15 million**, and three discloseable transactions involving land acquisition and construction agreements, with the company addressing past non-compliance with listing rule announcement requirements and no other major investment plans - A convertible bond placement plan with a maximum principal amount of **HKD 37,000,000** failed due to unfavorable market conditions, and the placement agreement has lapsed[50](index=50&type=chunk)[51](index=51&type=chunk) - The Group disclosed three discloseable transactions involving land acquisition and anaerobic facility construction, acknowledging non-compliance with listing rule announcement requirements due to misunderstanding[53](index=53&type=chunk)[54](index=54&type=chunk)[55](index=55&type=chunk) - The Group disclosed three lawsuits: one case with Bangwei Development was settled for **HKD 1.15 million**; a claim from Wu Bingjian for approximately **HKD 6.28 million** is ongoing, with directors expecting the company is unlikely to be liable; and a claim against the workshop for approximately **HKD 1.55 million** resulted in a default judgment, pending assessment of damages[52](index=52&type=chunk) [Employees and Remuneration](index=14&type=section&id=Employees%20and%20Remuneration) As of March 31, 2025, the Group employed **102 staff** (up from 77), with annual staff costs (including directors' emoluments) approximately **HKD 24.8 million** (up **14.8%**), offering competitive remuneration and benefits, while the Board does not recommend a final dividend for the year Employee Data | Indicator | FY2025 | FY2024 | | :--- | :--- | :--- | | Total Employees | 102 persons | 77 persons | | Staff Costs | 24.8 HKD million | 21.6 HKD million | - The Board does not recommend the payment of a final dividend for the year ended March 31, 2025[62](index=62&type=chunk) [Biographies of Directors and Senior Management](index=15&type=section&id=Biographies%20of%20Directors%20and%20Senior%20Management) The report provides detailed biographies of executive directors, independent non-executive directors, and the company secretary, covering their age, academic qualifications, professional credentials, and extensive experience across finance, accounting, management, and engineering - The report provides detailed biographies of executive directors, independent non-executive directors, and the company secretary, including their age, academic qualifications, professional credentials, and extensive experience in finance, accounting, management, and engineering[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk)[70](index=70&type=chunk)[71](index=71&type=chunk)[74](index=74&type=chunk) [Directors' Report](index=18&type=section&id=Directors%27%20Report) [Principal Activities and Results](index=18&type=section&id=Principal%20Activities%20and%20Results) The Company, an investment holding entity, primarily operates in construction, oil, agriculture, and bioenergy, with no significant business changes this year; the Board does not recommend a final dividend, as distribution decisions consider the Group's financial performance, capital needs, and future expansion plans - The Group primarily engages in four businesses: construction and engineering-related, oil, agriculture, and bioenergy[76](index=76&type=chunk) - The Directors do not recommend the payment of a final dividend for the year ended March 31, 2025[84](index=84&type=chunk) - The Company has adopted a dividend policy, but dividend decisions require comprehensive consideration of the Group's financial performance, retained earnings, working capital needs, future expansion plans, and other factors[79](index=79&type=chunk)[80](index=80&type=chunk) [Share Capital and Share Option Scheme](index=20&type=section&id=Share%20Capital%20and%20Share%20Option%20Scheme) As of March 31, 2025, the Company's issued share capital was **HKD 14.94 million** (1,494,000,000 shares); a share option scheme adopted in 2016 to incentivize talent, with a 10% authorized limit and 1.48 years remaining validity, saw no grants or outstanding options during the fiscal year - The Company adopted a share option scheme on December 23, 2016, with a ten-year validity, aimed at incentivizing employees, directors, and partners[91](index=91&type=chunk)[92](index=92&type=chunk) - For the year ended March 31, 2025, the Company did not grant any share options, and there were no outstanding share options at the beginning or end of the reporting period[102](index=102&type=chunk) [Major Customers and Suppliers](index=22&type=section&id=Major%20Customers%20and%20Suppliers) This fiscal year, the Group experienced high customer and supplier concentration, with the largest customer accounting for **18.1%** of total turnover and the top five customers collectively **50.8%**; similarly, the largest supplier represented **18.9%** of total direct costs and the top five suppliers collectively **47.7%**, with no beneficial interest held by directors or major shareholders in these key relationships Customer and Supplier Concentration | Item | Percentage | Amount (HKD million) | | :--- | :--- | :--- | | Largest customer as % of total turnover | 18.1% | 54.4 | | Top five customers as % of total turnover | 50.8% | 153.1 | | Largest supplier as % of total direct costs | 18.9% | 56.7 | | Top five suppliers as % of total direct costs | 47.7% | 143.2 | [Directors' and Major Shareholders' Interests](index=25&type=section&id=Directors%27%20and%20Major%20Shareholders%27%20Interests) As of March 31, 2025, Chairman Mr. Liu Zhan Cheng, through Fujincheng Investment Holding Co., Ltd., indirectly held **74.86%** of the issued share capital, making him the controlling shareholder, with his spouse Ms. Qin Hui deemed to hold the same interest; Executive Director Mr. Xu Jing beneficially owned **10,000 shares**, and no other directors or chief executives held discloseable share interests Directors' and Major Shareholders' Shareholdings (as of March 31, 2025) | Name/Entity | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Liu Zhan Cheng | Interest in controlled corporation | 1,118,460,000 | 74.86% | | Fujincheng | Beneficial owner | 1,118,460,000 | 74.86% | | Ms. Qin Hui | Spouse's interest | 1,118,460,000 | 74.86% | | Mr. Xu Jing | Beneficial owner | 10,000 | <0.01% | - Based on public information, the Company maintained sufficient public float as required by the Listing Rules during the reporting period[136](index=136&type=chunk) [Corporate Governance Report](index=28&type=section&id=Corporate%20Governance%20Report) [Corporate Governance Practices](index=28&type=section&id=Corporate%20Governance%20Practices) The Company adheres to high corporate governance standards, complying with most Code provisions but noting three deviations: combined Chairman and CEO roles, Chairman's absence from the AGM, and lack of directors' legal liability insurance; a code of conduct for securities transactions by directors and employees has been adopted - The Company complied with most provisions of the Corporate Governance Code, but with three deviations: - **Code Provision C.2.1**: The roles of Chairman and Chief Executive Officer are combined and held by Mr. Liu Zhan Cheng - **Code Provision F.2.2**: The Chairman was unable to attend the 2024 Annual General Meeting - **Code Provision C.1.8**: No appropriate legal liability insurance was arranged for directors[140](index=140&type=chunk)[144](index=144&type=chunk) [Board of Directors](index=29&type=section&id=Board%20of%20Directors) The Board oversees strategy, financial performance, and risk management, comprising two executive and three independent non-executive directors meeting Listing Rules; while adopting nomination and diversity policies, no gender diversity targets are set; the combined Chairman and CEO roles are deemed beneficial for strategic consistency, with independent directors providing checks, and all directors participated in continuous professional development - Board composition: As of the reporting date, the Board comprised **2 executive directors** and **3 independent non-executive directors**, meeting Listing Rules requirements for the number and professional qualifications of independent non-executive directors[146](index=146&type=chunk)[147](index=147&type=chunk) - The roles of Chairman and Chief Executive Officer are combined and held by Mr. Liu Zhan Cheng, constituting a deviation from Corporate Governance Code Provision C.2.1; the Board believes this arrangement facilitates consistency in strategic planning and execution, with sufficient independent non-executive directors providing checks and balances[166](index=166&type=chunk) - The Company has adopted a board diversity policy but currently deems it unnecessary to set numerical targets and timelines for gender diversity on the Board, continuing to gradually increase the proportion of female members as suitable candidates are identified[158](index=158&type=chunk) - All directors participated in continuous professional development training during the year, including attending seminars and reviewing relevant materials[167](index=167&type=chunk)[168](index=168&type=chunk) [Board Committees](index=35&type=section&id=Board%20Committees) The Board has three committees—Remuneration, Nomination, and Audit—each with defined terms of reference; these committees, comprising independent and executive directors, held meetings to review policies, appointments, financial results, and internal controls, with detailed attendance records provided, noting lower attendance by the Chairman - The Board has established three committees: Remuneration Committee, Nomination Committee, and Audit Committee, all with clearly defined written terms of reference[170](index=170&type=chunk) - The Audit Committee comprises **three independent non-executive directors**, with Chairman Dr. Su Li Xin possessing appropriate professional qualifications, meeting Listing Rules requirements; the Committee reviewed financial statements and internal control systems during the year[176](index=176&type=chunk) Directors' Meeting Attendance Record (Partial) | Director Name | Board Meetings | Audit Committee | Remuneration Committee | Nomination Committee | Annual General Meeting | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Liu Zhan Cheng | 1/5 | N/A | 1/2 | 1/2 | 0/1 | | Mr. Xu Jing | 5/5 | N/A | N/A | N/A | 1/1 | | Dr. Su Li Xin | 4/5 | 2/2 | 2/2 | 2/2 | 1/1 | [Risk Management and Internal Control](index=39&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board oversees the Group's risk management and internal control systems, reviewing them annually, and has established risk identification, assessment, and mitigation procedures; an independent consultant's review deemed the system effective, and while no internal audit function exists, its necessity is reviewed annually; the Group has also implemented insider information, whistleblowing, and anti-corruption policies - The Board is responsible for overseeing the risk management and internal control systems, reviewing their effectiveness at least annually[185](index=185&type=chunk) - The Company engaged an independent consulting firm to review its internal control system, which the Audit Committee deemed effective and adequate[186](index=186&type=chunk)[188](index=188&type=chunk) - The Company currently does not have an internal audit function but reviews the need for its establishment annually[188](index=188&type=chunk) - The Group has formulated and implemented policies for insider information disclosure, whistleblowing, and anti-corruption[189](index=189&type=chunk)[192](index=192&type=chunk)[195](index=195&type=chunk) [Independent Auditor's Report](index=42&type=section&id=Independent%20Auditor%27s%20Report) The independent auditor issued an unmodified opinion on the financial statements, while highlighting a **material uncertainty related to going concern** due to a **HKD 50.0 million net loss** and **HKD 2.9 million net current liabilities**, which casts significant doubt on the Group's ability to continue operations; key audit matters include revenue recognition for construction contracts and valuation of trade receivables and contract assets - The auditor issued an unmodified opinion, deeming the financial statements true and fair[201](index=201&type=chunk) - **Material Uncertainty Related to Going Concern**: The auditor draws attention to the Group's net loss of approximately **HKD 50.0 million** for the year and current liabilities exceeding current assets by approximately **HKD 2.9 million** at the end of the reporting period; these conditions indicate a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern, though this matter does not constitute a modified opinion[202](index=202&type=chunk) - Key audit matters include: 1. **Recognition of revenue from construction contracts**: Involves judgment and estimation of performance progress 2. **Valuation of trade receivables and contract assets**: Involves estimation of expected credit losses (ECL)[204](index=204&type=chunk)[205](index=205&type=chunk)[207](index=207&type=chunk) [Consolidated Financial Statements](index=47&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=47&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the year ended March 31, 2025, the Group's revenue significantly decreased to **HKD 301.0 million** from **HKD 489.8 million**, gross profit plummeted from **HKD 3.8 million to HKD 0.8 million**, and due to increased expenses, loss before tax expanded from **HKD 20.4 million to HKD 45.6 million**, resulting in a **HKD 50.9 million loss** for the year and a basic loss per share of **HKD 3.35 cents** Consolidated Income Statement Summary | Item (HKD thousand) | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 301,030 | 489,794 | | Gross Profit | 763 | 3,816 | | Loss before tax | (45,556) | (20,353) | | Loss for the year | (50,943) | (20,133) | | Loss attributable to owners of the Company | (50,034) | (19,940) | | Basic loss per share (HK cents) | (3.35) | (1.33) | [Consolidated Statement of Financial Position](index=48&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, the Group's total assets increased to **HKD 380.6 million**, driven by non-current asset growth, but total liabilities surged to **HKD 277.3 million** due to increased borrowings, reducing net assets to **HKD 103.2 million** and resulting in a **HKD 2.9 million net current liability**, indicating increased short-term solvency pressure Consolidated Statement of Financial Position Summary (as of March 31) | Item (HKD thousand) | 2025 | 2024 | | :--- | :--- | :--- | | **Assets** | | | | Non-current assets | 246,019 | 145,973 | | Current assets | 134,536 | 145,737 | | **Total assets** | **380,555** | **291,710** | | **Liabilities and Equity** | | | | Current liabilities | 137,392 | 124,278 | | Non-current liabilities | 139,918 | 13,042 | | **Total liabilities** | **277,310** | **137,320** | | **Net assets** | **103,245** | **154,390** | | Equity attributable to owners of the Company | 94,630 | 144,815 | - The Group recorded a net current liability of approximately **HKD 2.9 million** as of March 31, 2025, compared to a net current asset of **HKD 21.5 million** in the prior year, indicating a deterioration in short-term liquidity[222](index=222&type=chunk) [Consolidated Statement of Cash Flows](index=50&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) For the year ended March 31, 2025, the Group generated a **HKD 17.8 million net cash inflow** from operations, a significant improvement, but incurred a **HKD 108.2 million net cash outflow** from investing activities, primarily for property, plant, and equipment; financing activities provided a **HKD 105.5 million net cash inflow** from new borrowings, leading to year-end cash and cash equivalents increasing to **HKD 39.0 million** Consolidated Statement of Cash Flows Summary (HKD thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net cash from operating activities | 17,845 | (56,690) | | Net cash used in investing activities | (108,238) | (90,478) | | Net cash from financing activities | 105,484 | 24,616 | | Net increase (decrease) in cash and cash equivalents | 15,091 | (122,552) | | Cash and cash equivalents at end of year | 39,016 | 23,921 | - Significant cash outflow from investing activities, primarily for the purchase of property, plant, and equipment, amounting to **HKD 108.3 million**, reflecting the Group's substantial capital expenditure on new projects such as bioenergy[229](index=229&type=chunk) - Net cash inflow from financing activities primarily stemmed from **HKD 143.7 million** in new borrowings, utilized to support investing activities and daily operations[229](index=229&type=chunk) [Notes to the Consolidated Financial Statements](index=51&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [Key Accounting Policies and Judgments](index=55&type=section&id=Key%20Accounting%20Policies%20and%20Judgments) The financial statements are prepared on a going concern basis despite material uncertainties from the annual net loss and net current liabilities, for which management has mitigating actions; key accounting judgments include recognizing oil and grain trading as principal transactions, while major estimation uncertainties involve revenue recognition, expected credit loss provisions, deferred tax asset realizability, and property, plant, and equipment impairment - Material uncertainty regarding going concern: As of March 31, 2025, the Group recorded a net loss of approximately **HKD 50.0 million** and current liabilities exceeded current assets by approximately **HKD 2.9 million**; the Directors have taken measures to improve the financial position and consider the preparation of financial statements on a going concern basis appropriate[249](index=249&type=chunk) - Key accounting judgment: The Group treats its oil and grain trading businesses as principal, thus recognizing revenue on a gross basis[372](index=372&type=chunk) - Major sources of estimation uncertainty include: revenue recognition for construction contracts, expected credit loss provisions for trade receivables and contract assets, realizability of deferred tax assets, impairment and depreciation of property, plant, and equipment, and fair value measurement of biological assets[374](index=374&type=chunk)[376](index=376&type=chunk)[377](index=377&type=chunk)[379](index=379&type=chunk)[380](index=380&type=chunk) [Revenue and Segment Information](index=89&type=section&id=Revenue%20and%20Segment%20Information) For FY2025, the Group's total revenue decreased **38.5% to HKD 301.0 million**, with significant declines in construction and oil businesses, slight growth in agriculture, and **HKD 9.0 million** from new bioenergy; both Hong Kong and Mainland China revenues decreased, and the top five customers accounted for **50.8%** of total revenue, indicating high concentration Revenue by Business Segment (HKD thousand) | Business Segment | 2025 | 2024 | | :--- | :--- | :--- | | Construction and engineering related | 126,701 | 202,411 | | Oil business | 98,660 | 222,971 | | Agricultural business | 62,564 | 59,015 | | Bioenergy business | 8,979 | – | | **Revenue from contracts with customers** | **296,904** | **484,397** | | Farmland leasing | 4,126 | 5,397 | | **Total Revenue** | **301,030** | **489,794** | Revenue by Geographical Market (HKD thousand) | Geographical Market | 2025 | 2024 | | :--- | :--- | :--- | | Hong Kong | 126,701 | 201,526 | | Mainland China | 174,329 | 288,268 | | **Total** | **301,030** | **489,794** | - Revenue from the largest customer accounted for **18.1%** (**HKD 54.4 million**) of total revenue, and revenue from the top five customers accounted for **50.8%** (**HKD 153.1 million**) of total revenue[110](index=110&type=chunk) [Assets and Liabilities Analysis](index=103&type=section&id=Assets%20and%20Liabilities%20Analysis) As of March 31, 2025, the Group's asset structure changed significantly, with property, plant, and equipment increasing to **HKD 201.0 million** due to bioenergy facility completion; trade receivables and contract assets totaled **HKD 65.4 million** with increased provisions; total borrowings surged to **HKD 176.8 million**, largely from related parties and bank loans for new investments, significantly increasing financial leverage - The carrying value of property, plant, and equipment significantly increased from **HKD 81.5 million** to **HKD 201.0 million**, primarily due to the completion and transfer of **HKD 191 million** worth of construction in progress (mainly bioenergy treatment facilities) to buildings and machinery categories[419](index=419&type=chunk) Receivables and Contract Assets (HKD thousand) | Item | Gross carrying amount | Impairment allowance | Net carrying amount | | :--- | :--- | :--- | :--- | | Trade receivables | 34,956 | (16,069) | 18,887 | | Contract assets | 65,745 | (19,271) | 46,474 | Borrowings Composition (HKD thousand) | Borrowing Type | 2025 | 2024 | | :--- | :--- | :--- | | Bank loans (secured) | 68,674 | – | | Other borrowings (unsecured) | 108,175 | 61,078 | | **Total** | **176,849** | **61,078** | - Among other borrowings, approximately **HKD 66.5 million** was from related party Shandong Fujincheng, and approximately **HKD 7.7 million** was from Director Mr. Liu Zhan Cheng[463](index=463&type=chunk)[486](index=486&type=chunk) [Related Party Transactions](index=124&type=section&id=Related%20Party%20Transactions) This year, the Group engaged in several significant related party transactions, including **HKD 6.85 million** in key management personnel remuneration; substantial loans were received from Director Mr. Liu Zhan Cheng and his controlled company, Shandong Fujincheng, with total other borrowings payable reaching **HKD 74.2 million** at year-end, incurring approximately **HKD 3.5 million** in interest, providing crucial financial support Significant Related Party Transactions (FY2025) | Related Party | Nature of Transaction | Amount (HKD thousand) | | :--- | :--- | :--- | | Shandong Fujincheng | Loan interest for the year | 3,316 | | | Other borrowings balance at year-end | 66,483 | | Mr. Liu Zhan Cheng | Loan interest for the year | 207 | | | Other borrowings balance at year-end | 7,700 | - Total remuneration for key management personnel was **HKD 6,849,000**, a slight decrease from **HKD 7,044,000** last year[484](index=484&type=chunk) [Financial Summary](index=147&type=section&id=Financial%20Summary) The financial summary presents the Group's five-year performance and financial position, showing revenue declining to **HKD 301.0 million** in 2025 after peaking in 2023; profitability indicates recurring and expanding losses, with **HKD 50.0 million loss** attributable to shareholders in 2025; total assets grew, but total liabilities sharply increased in 2025, causing total equity to retreat from its 2023 high Five-Year Performance Summary (HKD thousand) | Item | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 301,030 | 489,794 | 661,230 | 306,558 | 221,894 | | Gross Profit | 763 | 3,816 | 22,116 | 10,181 | 13,902 | | (Loss) Profit attributable to owners of the Company | (50,034) | (19,940) | (8,829) | (21,010) | 1,006 | Five-Year Assets and Liabilities Summary (HKD thousand) | Item | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total assets | 380,555 | 291,710 | 273,975 | 253,754 | 149,411 | | Total liabilities | 277,310 | 137,320 | 104,657 | 108,430 | 31,706 | | Total equity | 103,245 | 154,390 | 169,318 | 145,324 | 117,705 |

[Annual Performance Overview](index=1&type=section&id=Annual%20Performance%20Announcement) [Financial Performance](index=2&type=section&id=Financial%20Performance) The Group's financial performance significantly deteriorated, marked by a 38.5% revenue decline, a net loss exceeding HKD 50.9 million, and a shift to net current liabilities [Consolidated Statement of Profit or Loss](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) Revenue decreased 38.5% to HKD 301.0 million, gross profit plunged 80%, and increased expenses led to a loss attributable to owners of HKD 50.0 million, with basic loss per share at HKD 3.35 cents | Metric | 2025 (HKD Thousands) | 2024 (HKD Thousands) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | **Revenue** | 301,030 | 489,794 | -38.5% | | **Gross Profit** | 763 | 3,816 | -80.0% | | **Loss Before Tax** | (45,556) | (20,353) | +123.8% | | **Loss for the Year** | (50,943) | (20,133) | +153.0% | | **Loss Attributable to Owners of the Company** | (50,034) | (19,940) | +150.9% | | **Basic Loss Per Share (HK Cents)** | (3.35) | (1.33) | +151.9% | [Consolidated Statement of Financial Position](index=3&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, total assets increased to HKD 380.6 million, but total liabilities surged to HKD 277.3 million, reducing net assets by 33% to HKD 103.2 million, with net current liabilities of HKD 2.9 million indicating severe short-term repayment pressure | Metric | March 31, 2025 (HKD Thousands) | March 31, 2024 (HKD Thousands) | Change | | :--- | :--- | :--- | :--- | | **Non-current Assets** | 246,019 | 145,973 | +68.5% | | **Current Assets** | 134,536 | 145,737 | -7.7% | | **Current Liabilities** | 137,392 | 124,278 | +10.5% | | **Net Current (Liabilities) Assets** | (2,856) | 21,459 | Turned Negative | | **Non-current Liabilities** | 139,918 | 13,042 | +972.8% | | **Net Assets** | 103,245 | 154,390 | -33.1% | - The Group's current liabilities exceeded its current assets by approximately **HKD 2,856,000**, a key factor contributing to significant uncertainty regarding its going concern ability[21](index=21&type=chunk)[34](index=34&type=chunk) [Independent Auditor's Report and Going Concern](index=17&type=section&id=Independent%20Auditor%27s%20Report%20and%20Going%20Concern) The independent auditor issued an unmodified opinion but highlighted "material uncertainty related to going concern" due to substantial losses, net operating cash outflow, and net current liabilities, with management outlining measures to address these issues - The auditor's report explicitly states that as of March 31, 2025, the Group recorded a net loss attributable to owners of approximately **HKD 50,034,000** and current liabilities exceeding current assets by approximately **HKD 2,856,000**, indicating material uncertainties that may cast significant doubt on the Group's ability to continue as a going concern[34](index=34&type=chunk) - To address going concern risks, management has implemented or plans to implement various measures, including reviewing operational efficiency, negotiating repayment with creditors, considering termination of loss-making businesses, seeking new financing, and utilizing existing standby loans[21](index=21&type=chunk) [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) Management attributes the annual loss to declining traditional business revenue and increased expenses for new bio-energy projects, leading to a strategic transformation focusing resources on the promising bio-energy sector for long-term returns [Business Review and Outlook](index=17&type=section&id=Business%20Review%20and%20Outlook) The net loss is primarily due to reduced oil and construction revenue, increased expenses, and limited bio-energy project contributions, prompting the Group to cautiously manage construction and pivot resources towards sustainable bio-energy initiatives - The net loss is primarily attributable to: (i) decreased revenue from oil and construction engineering businesses; (ii) increased administrative and finance expenses; and (iii) limited revenue contribution from two bio-energy projects that commenced operations only in the fourth quarter of the year[36](index=36&type=chunk) - Given the challenging construction market and bleak real estate outlook, the Group will cautiously approach further investments in construction and engineering businesses, concentrating resources on developing bio-energy projects to enhance corporate resilience and achieve long-term returns[37](index=37&type=chunk)[39](index=39&type=chunk) [Financial Review](index=21&type=section&id=Financial%20Review) All financial indicators deteriorated this year, with revenue down 38.5% and gross profit plunging 80%, while administrative expenses and finance costs surged due to new bio-energy plant depreciation and increased loans, expanding the annual loss | Business Segment | 2025 Revenue (HKD Thousands) | 2024 Revenue (HKD Thousands) | Change | | :--- | :--- | :--- | :--- | | Construction and Engineering Related Business | 126,701 | 202,411 | -37.4% | | Oil Business | 98,660 | 222,971 | -55.8% | | Agricultural Business | 62,564 | 59,015 | +6.0% | | Bio-energy Business | 8,979 | – | N/A | | **Total Revenue from Contracts with Customers** | **296,904** | **484,397** | **-38.7%** | - Administrative and other operating expenses increased from **HKD 22.5 million** to **HKD 31.3 million**, primarily due to increased depreciation from the completion of bio-energy plants, salaries, and other operating expenses[52](index=52&type=chunk) - Finance costs surged from **HKD 1.3 million** to **HKD 6.4 million**, mainly due to increased borrowings during the year[53](index=53&type=chunk) [Liquidity and Financial Resources](index=23&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's financial leverage sharply increased, and liquidity tightened, with the gearing ratio surging from 48.8% to 181.7% due to increased borrowings, while bank balances and cash were HKD 39.0 million and the current ratio decreased to 1.0 times | Metric | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Bank Balances and Cash | Approx. HKD 39.0 Million | Approx. HKD 23.9 Million | | Total Interest-bearing Borrowings and Lease Liabilities | Approx. HKD 187.6 Million | Approx. HKD 75.3 Million | | Gearing Ratio | Approx. 181.7% | Approx. 48.8% | | Current Ratio | Approx. 1.0 Times | Approx. 1.2 Times | [Key Risks and Uncertainties](index=19&type=section&id=Key%20Risks%20and%20Uncertainties) The Group faces diversified risks including non-recurring construction contracts, cost volatility, macroeconomic and energy price sensitivity, agricultural natural disaster risks, and potential additional capital and operational expenses from new bio-energy ventures - The Group's business performance relies on the continuous success of project bidding, with contracts being non-recurring[40](index=40&type=chunk) - The oil business is closely linked to macroeconomic conditions and energy prices, where price fluctuations due to geopolitical conflicts may adversely affect the Group's performance[40](index=40&type=chunk) - New strategies such as developing bio-energy businesses may incur additional capital expenditures, depreciation, and other operating expenses[40](index=40&type=chunk) [Other Significant Matters](index=14&type=section&id=Other%20Significant%20Matters) During the year, the Group did not declare dividends, disclosed three bio-energy related discloseable transactions with admitted non-compliance, and is involved in several ongoing legal litigations with uncertain outcomes [Dividend Policy](index=14&type=section&id=Dividend%20Policy) Considering this year's loss and future capital requirements, the Board decided not to recommend a final dividend for the year ended March 31, 2025 - The Board does not recommend the payment of a final dividend for the year ended March 31, 2025 (2024: nil)[28](index=28&type=chunk)[78](index=78&type=chunk) [Discloseable Transactions and Compliance Issues](index=26&type=section&id=Discloseable%20Transactions%20and%20Compliance%20Issues) The Group disclosed three Shandong bio-energy project transactions, including land acquisition and construction, admitting non-compliance with listing rule announcement requirements due to operational team misunderstanding, and has implemented remedial measures - The company failed to comply with Chapter 14 of the Listing Rules regarding announcement requirements for three discloseable transactions: land acquisition, anaerobic facility construction, and civil engineering works[69](index=69&type=chunk)[70](index=70&type=chunk)[71](index=71&type=chunk) - The reason for non-compliance was the Group's operational team's misunderstanding that these transactions were part of the Group's ordinary and usual course of business[71](index=71&type=chunk) [Litigation](index=25&type=section&id=Litigation) The Group is involved in several legal litigations, including an ongoing case with Ng Ping Kin Development Management Limited claiming HKD 6.283 million, against which the Group counterclaimed HKD 6.0 million, with no provision made as directors deem the claim unlikely - The Group's client, Ng Ping Kin, claimed approximately **HKD 6,283,000** for six post-dated cheques, against which the Group has filed a defense and a counterclaim for **HKD 6,000,000**, with the litigation ongoing[65](index=65&type=chunk) [Corporate Governance](index=29&type=section&id=Corporate%20Governance) The company has several corporate governance deviations, including the dual role of Chairman and CEO, the Chairman's absence from the 2024 AGM, and the lack of legal liability insurance for directors, with explanations provided - The company deviated from Corporate Governance Code Provision C.2.1, where the roles of Chairman and Chief Executive Officer are concurrently held by Mr. Lau Chin Ching; the Board believes this ensures consistency in strategic planning and execution[81](index=81&type=chunk) - The company deviated from Corporate Governance Code Provision C.1.8 by not arranging any legal liability insurance for directors during the year, as the company assessed the related risk as very low[82](index=82&type=chunk)

Financial Performance - Revenue for the six months ended September 30, 2024, was HKD 144,004,000, a slight increase from HKD 143,854,000 in the same period of 2023[15]. - The gross profit for the period was HKD 150,000, compared to HKD 3,950,000 in the previous year, indicating a significant decline[15]. - The total comprehensive expenses for the period amounted to HKD 19,239,000, up from HKD 11,576,000 in the same period last year, representing a 66.5% increase[14]. - The net loss for the period was HKD 20,047,000, compared to a loss of HKD 7,097,000 in the prior year, reflecting a 182.5% increase in losses[15]. - Basic loss per share for the period was HKD (1.32), compared to HKD (0.48) in the same period of 2023[17]. - The group incurred a pre-tax loss of HKD 19,291,000 for the six months ended September 30, 2024, compared to a loss of HKD 15,077,000 in the previous year[44]. - The total loss attributable to the company's owners for the six months ended September 30, 2024, was approximately HKD 20.0 million, compared to HKD 7.1 million for the same period in 2023[85]. - Revenue decreased from approximately HKD 304.6 million for the six months ended September 30, 2023, to approximately HKD 144.0 million for the same period in 2024, representing a decline of about HKD 160.6 million or 52.7%[76]. Assets and Liabilities - Non-current assets increased to HKD 240,843,000 as of September 30, 2024, from HKD 145,973,000 as of March 31, 2024, showing a growth of 64.8%[19]. - Current liabilities rose to HKD 164,153,000 from HKD 124,278,000, marking a 32.1% increase[20]. - The company's total equity decreased to HKD 135,151,000 from HKD 154,390,000, a decline of 12.4%[20]. - The group’s total assets as of September 30, 2024, amounted to HKD 376,397,000, with liabilities totaling HKD 231,029,000[47]. - The group’s debt-to-asset ratio increased to approximately 118.8% as of September 30, 2024, from 48.8% as of March 31, 2024, mainly due to increased bank borrowings[88]. Cash Flow - The company reported a net cash inflow from operating activities of HKD 16,039,000 for the six months ended September 30, 2024, compared to a net outflow of HKD 83,246,000 for the same period in 2023[25]. - The net cash outflow from investing activities was HKD 86,814,000, significantly higher than HKD 12,911,000 in the previous year[25]. - The net cash inflow from financing activities increased to HKD 73,013,000 from HKD 7,241,000 year-on-year[25]. - The cash and cash equivalents at the end of the period were HKD 26,981,000, down from HKD 59,949,000 at the end of the previous year[25]. - The group maintained a cash balance of approximately HKD 27.0 million as of September 30, 2024, compared to HKD 23.9 million as of March 31, 2024[86]. Revenue Breakdown - The total revenue from customer contracts for the six months ended September 30, 2024, was HKD 141,027,000, a decrease of 53.2% from HKD 301,735,000 in the same period of 2023[40]. - Revenue from construction and engineering-related services was HKD 58,554,000, down 47% from HKD 110,542,000 in the previous year[36]. - Agricultural business revenue increased to HKD 45,291,000 from HKD 4,567,000 year-on-year, indicating a significant growth in this segment[40]. - The group reported segment revenue of HKD 144,004,000 for the six months ended September 30, 2024, compared to HKD 111,722,000 in construction and engineering, HKD 185,446,000 in oil, and HKD 7,438,000 in agriculture for the same period in 2023[44]. - The group’s revenue from oil trading was HKD 185,446,000, contributing significantly to the overall segment revenue[46]. Operational Expenses - The group’s total employee benefit expenses, including directors' remuneration, amounted to HKD 10,918,000 for the six months ended September 30, 2024, compared to HKD 9,256,000 in the prior year[53]. - Sales expenses increased from approximately HKD 0.9 million for the six months ended September 30, 2023, to approximately HKD 1.7 million for the same period in 2024, driven by higher costs in the bioenergy business[81]. - Administrative and other operating expenses rose by approximately 15.0% from about HKD 10.7 million for the six months ended September 30, 2023, to about HKD 12.3 million for the same period in 2024, mainly due to increased expenses in the bioenergy sector[82]. - Financing costs increased from approximately HKD 0.4 million for the six months ended September 30, 2023, to about HKD 1.9 million for the same period in 2024, primarily due to an increase in bank borrowings[84]. Strategic Initiatives - The company plans to implement cost-saving measures and review existing investments to improve cash flow and financial stability[31]. - The company is considering new business developments and financial instruments to support ongoing operations and liquidity[31]. - The company is actively exploring technologies and market development related to agricultural biomass to capitalize on opportunities arising from rural revitalization initiatives[75]. - The company anticipates that its biomass energy project, which is a key project in Shandong Province, will generate revenue and profit in the second half of the fiscal year[75]. - The company plans to allocate more resources to biomass clean energy projects to create long-term stable returns for shareholders[75]. Employee and Governance - The total employee count increased to 92 as of September 30, 2024, compared to 54 employees for the same period in 2023, with employee costs amounting to approximately HKD 10.9 million, up from HKD 9.3 million[104]. - The group provides competitive compensation and benefits to attract and retain high-quality employees, including performance-based bonuses and stock options[106]. - The audit committee consists of independent non-executive directors, ensuring compliance with listing rules regarding membership and qualifications[139]. - The audit committee has reviewed the group's financial statements for the six months ending September 30, 2024, and believes that the performance complies with applicable accounting standards and listing rules[141]. Shareholder Information - The board did not recommend an interim dividend for the six months ended September 30, 2024, consistent with the previous period[107]. - As of September 30, 2024, Mr. Liu Zhan Cheng holds 74.86% of the issued share capital through Fujincheng Investment Holdings Co., Ltd.[116]. - As of September 30, 2024, there were no major shareholders or other individuals holding interests in the company's shares that required disclosure under the Securities and Futures Ordinance[121].

Financial Performance - Revenue for the six months ended September 30, 2024, was HKD 144,004,000, a decrease of 52.7% compared to HKD 304,606,000 for the same period in 2023[4] - Gross profit for the same period was HKD 150,000, down 96.2% from HKD 3,950,000 in the previous year[4] - The company reported a loss before tax of HKD 19,291,000, compared to a loss of HKD 7,076,000 in the prior period, representing an increase in loss of 172.5%[4] - Total comprehensive loss for the period was HKD 19,239,000, compared to HKD 11,576,000 in the previous year, indicating a 66.5% increase in losses[5] - Basic loss per share for the six months ended September 30, 2024, was HKD 1.32, compared to HKD 0.48 in the same period last year, reflecting a 175% increase in loss per share[5] - The group reported a loss of approximately HKD 20,047,000 for the period ending September 30, 2024, with current liabilities exceeding current assets by about HKD 24,246,000[15] - The total pre-tax loss for the six months ending September 30, 2024, was HKD 19,291,000, compared to a pre-tax loss of HKD 7,076,000 for the same period in 2023[25][26] - The company recorded a net loss of approximately HKD 20.0 million for the six months ended September 30, 2024, compared to a net loss of approximately HKD 7.1 million for the same period in 2023, indicating a significant increase in losses[56][67] Revenue Breakdown - Revenue from customer contracts totaled HKD 141,027,000 for the six months ending September 30, 2024, a decrease of 53.3% compared to HKD 301,735,000 for the same period in 2023[19] - The construction and engineering segment generated revenue of HKD 58,996,000, down 47.3% from HKD 111,722,000 year-over-year[21] - The oil business revenue decreased by 80.2% to HKD 36,740,000 from HKD 185,446,000 in the previous year[21] - Agricultural business revenue increased significantly to HKD 45,291,000 from HKD 4,567,000, reflecting a substantial growth in sales of agricultural products and oil[21] Assets and Liabilities - Non-current assets increased to HKD 240,843,000 as of September 30, 2024, from HKD 145,973,000 as of March 31, 2024, marking a 64.8% increase[7] - Current liabilities rose to HKD 164,153,000 as of September 30, 2024, compared to HKD 124,278,000 as of March 31, 2024, representing a 32.1% increase[7] - The company’s total equity decreased to HKD 135,151,000 as of September 30, 2024, down from HKD 154,390,000 as of March 31, 2024, indicating a decline of 12.4%[8] - Total reportable segment assets as of September 30, 2024, amounted to HKD 380,750,000, with the largest contribution from the bioenergy segment at HKD 228,906,000[28] - The reportable segment liabilities totaled HKD 245,599,000, with the bioenergy segment accounting for HKD 191,264,000[28] - The total assets of the group were approximately HKD 380.8 million, an increase from HKD 291.7 million as of March 31, 2024[68] - The total liabilities and shareholders' equity were approximately HKD 245.6 million and HKD 135.2 million, respectively, as of September 30, 2024[68] Cash Flow and Financing - The company continues to assess its ability to operate as a going concern, expecting to have sufficient resources for the foreseeable future[13] - The company has taken on additional borrowings of approximately HKD 106.3 million, with an interest rate of 4.5%-6% and a repayment period of 1 to 7 years[14] - The group is considering other financial instruments, such as obtaining new loans or issuing debt, to provide ongoing financial support[15] - The group maintained a current ratio of approximately 0.9 times as of September 30, 2024, down from 1.2 times as of March 31, 2024[68] - The debt-to-asset ratio increased to approximately 118.8% as of September 30, 2024, compared to 48.8% as of March 31, 2024, primarily due to increased bank borrowings[69] - The total interest-bearing borrowings amounted to approximately HKD 149.3 million as of September 30, 2024, compared to HKD 61.1 million as of March 31, 2024[68] Operational Measures - The group is implementing cost-saving measures to control operating, administrative, and corporate costs to reduce working capital needs[15] - The group is actively reviewing existing investments and business opportunities to enhance cash flow and considering the liquidation of loss-making investments[15] - Administrative and other operating expenses increased by approximately 15.0%, from about HKD 10.7 million to approximately HKD 12.3 million, mainly due to increased expenses in the bioenergy business[64] - Financing costs rose from approximately HKD 0.4 million to approximately HKD 1.9 million, attributed to increased bank borrowings[66] Corporate Governance and Compliance - The company has adopted the corporate governance code as per the listing rules and has complied with all applicable provisions, except for deviations regarding the roles of the Chairman and CEO, which have been held by the same individual since June 8, 2021[108] - The company has not arranged any legal liability insurance for its directors, estimating that the risk of any foreseeable events requiring such insurance is minimal[109] - The Audit Committee, established on December 23, 2016, is chaired by an independent non-executive director and includes members with appropriate professional qualifications in financial management[110] - The interim financial statements for the six months ended September 30, 2024, have been reviewed by the Audit Committee and are deemed to comply with applicable accounting standards and legal requirements[113] Future Outlook - The company plans to invest more resources in biomass clean energy projects to create long-term stable returns for shareholders[57] - The bioenergy project has been designated as a key project in Shandong Province and is expected to generate revenue and profit in the second half of the fiscal year[57] Other Information - The company did not declare any dividends for the six months ended September 30, 2024, consistent with the previous year[36] - The group did not recommend any interim dividend for the six months ended September 30, 2024[89] - The company entered into a land use rights transfer agreement for a total consideration of RMB 10,630,000[90] - An anaerobic facility construction agreement was signed with a total contract value of RMB 25,105,850[91] - A construction agreement was established with a total contract amount of RMB 31,795,467.53[92] - The company failed to comply with the listing rules regarding disclosures due to a misunderstanding of the nature of the transactions[94] - The board has implemented remedial actions to prevent future violations of listing rules[95] - No significant events affecting the group have occurred since September 30, 2024[97] - The company did not purchase, sell, or redeem any of its listed securities during the six months ending September 30, 2024[98] - There were no changes to the director's information as required by listing rules[99] - The company has adopted a standard code of conduct for directors regarding securities trading, with full compliance reported[101] - No stock options were granted, exercised, or expired under the stock option plan during the six months ending September 30, 2024[107]

[Company Information](index=2&type=section&id=Company%20Information) This section provides essential company information, including contact details for the board, committees, company secretary, auditor, legal advisors, share registrar, registered office, principal place of business, and principal bankers - This section provides essential company information, including contact details for the board, committees, company secretary, auditor, legal advisors, share registrar, registered office, principal place of business, and principal bankers[6](index=6&type=chunk)[7](index=7&type=chunk) [Chairman's Statement](index=4&type=section&id=Chairman's%20Statement) The Chairman's Statement reviews the Group's annual performance amidst macroeconomic challenges, noting a decline in total revenue and expanded losses primarily due to reduced oil business income and the nascent stage of new bio-energy projects. It highlights the strategic transformation towards organic waste utilization, aligning with national policies and expected to contribute revenue by Q4 2024, while emphasizing future resource optimization and diversified business development for long-term sustainable returns - Facing a challenging business environment with unsatisfactory post-pandemic recovery and international tensions, the Group flexibly adjusted its strategy, investing in organic waste comprehensive utilization projects to align with China's national development strategy[8](index=8&type=chunk)[9](index=9&type=chunk) Key Financial Performance | Metric | FY2024 | FY2023 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | Approx. **HKD 489.8 million** | Approx. **HKD 661.2 million** | -25.9% | | **Loss Attributable to Shareholders** | Approx. **HKD 24.1 million** | Approx. **HKD 10.1 million** | +138.6% | - The decline in performance is primarily attributed to significant internal capital deployment for organic waste project construction, leading to reduced investment in the oil business and a substantial drop in revenue, while the new project is still under construction and not yet generating income[10](index=10&type=chunk) - Looking ahead, despite challenging operating conditions, the Board will continue to optimize resource allocation, stabilize existing businesses, and actively expand into new ventures, particularly those aligned with China's strategic development, to achieve business diversification and broaden revenue streams[13](index=13&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) This section provides a comprehensive review of the Group's business operations, financial performance, liquidity, and future outlook, alongside an analysis of key risks and significant events [Business Review and Outlook](index=6&type=section&id=Business%20Review%20and%20Outlook) This year, the Group's total revenue decreased to **HKD 489.8 million**, primarily due to reduced revenue from the mainland China oil trading business, partially offset by growth in construction and agriculture. The Group actively invested in a Shandong bio-energy project, aligning with national rural revitalization policies, which processes organic waste into green natural gas and has entered trial production, with future plans to prudently evaluate opportunities and expand revenue streams amidst economic slowdown and rising costs - The Group primarily engages in construction and engineering, oil, agriculture, and bio-energy businesses, with annual revenue decreasing from **HKD 661.2 million** to **HKD 489.8 million**, mainly due to a decline in oil trading revenue[15](index=15&type=chunk) - In February 2023, the Group approved investment in a rural biomass comprehensive development and utilization project in Shandong, aligning with China's '14th Five-Year Plan' and now in the land acquisition and facility construction phases[16](index=16&type=chunk) [Key Risks and Uncertainties](index=6&type=section&id=Key%20Risks%20and%20Uncertainties) The Group faces key risks including the non-recurring nature of business contracts, potential legal disputes, challenges in project cost control, reliance on stable labor supply, and macroeconomic, energy price volatility, and agriculture-related natural disaster and price cyclical risks - The Group's risks include the non-recurring nature of contracts, legal dispute risks, sub-contracting and material cost fluctuation risks, and labor supply stability risks[17](index=17&type=chunk)[18](index=18&type=chunk) - Industry-specific risks include the oil business being affected by macroeconomic conditions and energy prices, such as oil price volatility due to geopolitical influences, and the agriculture business facing extreme weather, natural disasters, pests, and fluctuations in product selling and procurement prices[22](index=22&type=chunk) [Financial Review](index=8&type=section&id=Financial%20Review) This fiscal year, the Group's total revenue decreased by **25.9%** year-on-year to **HKD 489.8 million**, with gross profit significantly declining by **82.7%** to **HKD 3.8 million**, primarily dragged by the oil trading business. Despite recording a **HKD 5.1 million** impairment credit reversal, increased selling expenses and finance costs ultimately led to an expanded annual loss of **HKD 20.1 million** Key Financial Indicators | Financial Metric | FY2024 (HKD million) | FY2023 (HKD million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Revenue** | 489.8 | 661.2 | -25.9% | | **Direct Costs** | 486.0 | 639.1 | -24.0% | | **Gross Profit** | 3.8 | 22.1 | -82.7% | | **Impairment Loss (Net of Reversal)** | (5.1) | 6.2 | N/A | | **Selling Expenses** | 2.9 | 1.0 | +190% | | **Finance Costs** | 1.3 | 0.6 | +116.7% | | **Loss for the Year** | 20.1 | 8.8 | +128.4% | [Liquidity and Financial Resources](index=9&type=section&id=Liquidity%20and%20Financial%20Resources) As of March 31, 2024, the Group's financial position indicates tightening liquidity, with total assets slightly increasing to **HKD 291.7 million**, but cash and bank balances sharply declining from **HKD 153.3 million** to **HKD 23.9 million**. Total interest-bearing borrowings significantly increased to **HKD 75.3 million**, causing the gearing ratio to surge from **9.8%** to **48.8%**, and the current ratio to drop from **2.5 times** to **1.2 times** Key Liquidity and Financial Resources Indicators | Metric | March 31, 2024 | March 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **HKD 291.7 million** | **HKD 274.0 million** | | **Total Liabilities** | **HKD 137.3 million** | **HKD 104.7 million** | | **Shareholders' Equity** | **HKD 154.4 million** | **HKD 169.3 million** | | **Interest-bearing Borrowings and Lease Liabilities** | **HKD 75.3 million** | **HKD 16.6 million** | | **Bank Balances and Cash** | **HKD 23.9 million** | **HKD 153.3 million** | | **Current Ratio** | **1.2 times** | **2.5 times** | | **Gearing Ratio** | **48.8%** | **9.8%** | - The increase in gearing ratio is primarily due to the rise in total borrowings during the year[40](index=40&type=chunk) [Significant Investments and Litigation](index=11&type=section&id=Significant%20Investments%20and%20Litigation) During the year, the Group increased its stake in Biaofa Eco (Juye) from **60%** to **90%** through a **RMB 30 million** capital injection, while its equity in Biaofa Eco (Juancheng) increased to **66.7%** due to other shareholders' withdrawal. Additionally, the Group is involved in four ongoing civil lawsuits, with provisions made for two, one expected to be won, and another for which no liability is anticipated - The Group increased its equity interest in Biaofa Eco (Juye), an indirect wholly-owned subsidiary, from **60%** to **90%** through a capital injection of **RMB 30 million**[53](index=53&type=chunk) - The Group is involved in four civil lawsuits, with provisions made for two, amounting to **HKD 0.267 million** and **HKD 0.409 million** respectively[50](index=50&type=chunk) [Events After Reporting Period](index=13&type=section&id=Events%20After%20Reporting%20Period) Subsequent to the reporting period, on May 21, 2024, the Group's subsidiary, Biaofa Eco (Juancheng) Co., Ltd., entered into a **RMB 50 million** loan agreement with Industrial Bank, guaranteed by the Company and a director - On May 21, 2024, subsidiary Biaofa Eco (Juancheng) entered into a loan agreement with a principal amount of **RMB 50 million**[60](index=60&type=chunk) [Biographies of Directors and Senior Management](index=13&type=section&id=Biographies%20of%20Directors%20and%20Senior%20Management) This section details the personal biographies of the Company's executive directors, independent non-executive directors, and company secretary, including their age, academic background, professional qualifications, industry experience, and their roles and committee memberships within the Company - Executive Directors include Mr. Liu Zhan Cheng, Chairman and Chief Executive Officer, Ms. Qin Mingyue, and Mr. Xu Jing, Chief Financial Officer, all possessing extensive experience in management, investment, finance, and corporate finance[63](index=63&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk) - Independent Non-executive Directors include Dr. Su Lixin, Mr. Leung Wing Chun, and Dr. Yan Bing, who possess profound professional backgrounds in accounting academia, engineering consulting, and international economic research, respectively[68](index=68&type=chunk)[69](index=69&type=chunk)[72](index=72&type=chunk) [Directors' Report](index=16&type=section&id=Directors'%20Report) The Directors' Report outlines the Group's principal activities, financial performance, dividend policy, share capital structure, and significant transactions. During the reporting period, the Group primarily engaged in construction, oil, agriculture, and bio-energy businesses, experiencing decreased total revenue and expanded losses, with no final dividend recommended. The report discloses connected transactions and capital injections into bio-energy subsidiaries, details directors' and major shareholders' equity interests, and confirms compliance with public float requirements [Results and Dividends](index=18&type=section&id=Results%20and%20Dividends) The Group recorded a loss for the current fiscal year, and the Board does not recommend the payment of a final dividend for the year ended March 31, 2024 - The Directors do not recommend the payment of a final dividend for the year ended March 31, 2024[85](index=85&type=chunk) [Discloseable and Connected Transactions](index=21&type=section&id=Discloseable%20and%20Connected%20Transactions) During the reporting period, the Group undertook two significant discloseable transactions: a joint capital injection with connected persons into Biaofa Eco (Juancheng), approved by independent shareholders, and a **RMB 30 million** capital injection into another subsidiary, Biaofa Eco (Juye), to support its biomass clean energy business development - The Group, together with connected persons including Shandong Caijin Energy, made a capital injection into Biaofa Eco (Juancheng) Co., Ltd., constituting a discloseable and connected transaction, which was approved by shareholders at an EGM on February 13, 2023[110](index=110&type=chunk)[111](index=111&type=chunk) - On December 6, 2023, the Group injected **RMB 30 million** into Biaofa Eco (Juye) Co., Ltd., a discloseable transaction aimed at developing the biomass clean energy market[115](index=115&type=chunk) [Major Customers and Suppliers](index=22&type=section&id=Major%20Customers%20and%20Suppliers) This fiscal year, the Group experienced high customer and supplier concentration, with the largest customer contributing **21.3%** of total turnover and the top five customers accounting for **62.5%**. On the supply side, the largest supplier represented **11.7%** of total direct costs, and the top five suppliers collectively accounted for **30.9%** Customer and Supplier Concentration | Concentration Metric | Percentage | | :--- | :--- | | **Largest Customer as % of Total Turnover** | **21.3%** | | **Top Five Customers as % of Total Turnover** | **62.5%** | | **Largest Supplier as % of Total Direct Costs** | **11.7%** | | **Top Five Suppliers as % of Total Direct Costs** | **30.9%** | [Directors' and Chief Executives' Interests and Short Positions in Shares, Underlying Shares and Debentures](index=25&type=section&id=Directors'%20and%20Chief%20Executives'%20Interests%20and%20Short%20Positions%20in%20Shares,%20Underlying%20Shares%20and%20Debentures) As of March 31, 2024, Chairman Mr. Liu Zhan Cheng beneficially owned **74.86%** of the Company's shares through his controlled corporation, making him the controlling shareholder. Executive Director Mr. Xu beneficially owned **10,000** shares. No other directors or chief executives held interests in the Company's shares Directors' and Chief Executives' Interests in Shares | Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | **Mr. Liu Zhan Cheng** | Interest in controlled corporation | **1,118,460,000** | **74.86%** | | **Mr. Xu** | Beneficial owner | **10,000** | **<0.01%** | [Corporate Governance Report](index=27&type=section&id=Corporate%20Governance%20Report) This report outlines the Company's corporate governance structure and practices, noting adherence to the Corporate Governance Code with three deviations during the reporting period: non-separation of Chairman and CEO roles, Chairman's absence from the AGM, and insufficient board meeting frequency. It details the Board's responsibilities, the functions of its Audit, Remuneration, and Nomination Committees, and the Company's policies on risk management, internal control, information disclosure, and shareholder communication [Corporate Governance Practices](index=28&type=section&id=Corporate%20Governance%20Practices) The Company has applied the principles and provisions of the Corporate Governance Code, but during the reporting period, there were three deviations: the Chairman and Chief Executive roles are held by the same person (deviation from Code Provision C.2.1), the Chairman did not attend the AGM (deviation from Code Provision F.2.2), and the Board held insufficient regular meetings (deviation from Code Provision C.5.1). Additionally, the Company has not arranged legal liability insurance for directors (deviation from Code Provision C.1.8) - The Company has complied with the Corporate Governance Code, but with three main deviations: - **Overlap of Chairman and CEO roles**: Mr. Liu Zhan Cheng holds both Chairman and CEO positions, deviating from Code Provision C.2.1 - **Chairman's absence from AGM**: Chairman Mr. Liu Zhan Cheng was unable to attend the 2023 Annual General Meeting, deviating from Code Provision F.2.2 - **Insufficient Board meeting frequency**: Only two regular Board meetings were held during the year, instead of the required minimum of four, deviating from Code Provision C.5.1[152](index=152&type=chunk)[193](index=193&type=chunk)[194](index=194&type=chunk) - The Company has not arranged appropriate legal liability insurance for its directors, deviating from Code Provision C.1.8, as the Company assessed the related risk to be minimal[154](index=154&type=chunk) [Board Committees](index=35&type=section&id=Board%20Committees) The Board has three committees: Remuneration, Nomination, and Audit. The Remuneration Committee reviews directors' and senior management's remuneration. The Nomination Committee reviews Board composition and nominates new directors. The Audit Committee, comprising three independent non-executive directors, oversees financial reporting, internal control, and risk management. All committees held meetings during the year to fulfill their duties - **Remuneration Committee**: Chaired by Mr. Leung Wing Chun, with members Dr. Su Lixin and Mr. Liu Zhan Cheng. One meeting was held during the year to review directors' and senior management's remuneration[185](index=185&type=chunk) - **Nomination Committee**: Chaired by Mr. Liu Zhan Cheng, with members Dr. Su Lixin and Mr. Leung Wing Chun. One meeting was held during the year to review and recommend matters related to the re-election of directors[187](index=187&type=chunk)[188](index=188&type=chunk) - **Audit Committee**: Chaired by Dr. Su Lixin, with members Mr. Leung Wing Chun and Dr. Yan Bing. Two meetings were held during the year to review annual and interim results, internal control, and risk management systems[189](index=189&type=chunk) [Risk Management and Internal Control](index=39&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board bears overall responsibility for the Group's risk management and internal control systems, reviewing them at least annually. The Group has established risk identification, assessment, and mitigation procedures. An independent consultant reviewed the internal control system, which the Audit Committee deemed effective and adequate. Although the Corporate Governance Code suggests an internal audit function, the Company currently does not have one and will review its necessity annually - The Board is responsible for overseeing the internal control and risk management systems, reviewing their effectiveness at least annually[202](index=202&type=chunk) - The Group engaged an independent consultant to review the internal control system, which the Audit Committee and the Board deemed effective and adequate[203](index=203&type=chunk) - The Company has not established an internal audit function but will review the necessity of doing so annually[204](index=204&type=chunk) [Independent Auditor's Report](index=41&type=section&id=Independent%20Auditor's%20Report) Huarong (Hong Kong) CPA Limited, the independent auditor, issued an unqualified opinion on the Group's consolidated financial statements as of March 31, 2024, affirming that they present a true and fair view of the Group's financial position, performance, and cash flows. The report highlighted two key audit matters: revenue recognition for construction contracts and the valuation of trade receivables and contract assets, both involving significant management judgment and estimation - The auditor issued an unqualified opinion on the consolidated financial statements, deeming them to present a true and fair view of the Group's financial position and operating results[218](index=218&type=chunk) - Key Audit Matter One: **Revenue recognition for construction contracts**. This is considered a key audit matter due to its material amount and the significant judgment and estimation involved in assessing project progress[223](index=223&type=chunk) - Key Audit Matter Two: **Valuation of trade receivables and contract assets**. This is considered a key audit matter because their balances are material to the financial statements as a whole, and the estimation of expected credit losses involves significant management judgment[225](index=225&type=chunk) [Consolidated Financial Statements](index=46&type=section&id=Consolidated%20Financial%20Statements) This section presents the Group's consolidated financial statements, including the statement of profit or loss and other comprehensive income, statement of financial position, statement of changes in equity, and statement of cash flows, providing a comprehensive overview of the Group's financial performance and position [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=47&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the year ended March 31, 2024, the Group's revenue significantly decreased to **HKD 489.8 million** from **HKD 661.2 million** last year, with gross profit falling from **HKD 22.1 million** to **HKD 3.8 million**. Due to reduced revenue and various expenses, the annual loss expanded from **HKD 8.8 million** to **HKD 20.1 million**, resulting in a total comprehensive expense of **HKD 24.4 million** after accounting for exchange differences Consolidated Statement of Profit or Loss and Other Comprehensive Income | Item (HKD thousand) | 2024 | 2023 | | :--- | :--- | :--- | | **Revenue** | 489,794 | 661,230 | | **Gross Profit** | 3,816 | 22,116 | | **Loss Before Tax** | (20,353) | (7,351) | | **Loss for the Year** | (20,133) | (8,829) | | **Loss Attributable to Owners of the Company** | (19,940) | (8,829) | | **Total Comprehensive Expense for the Year** | (24,368) | (10,101) | | **Basic Loss Per Share (HK cents)** | (1.33) | (0.63) | [Consolidated Statement of Financial Position](index=48&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2024, the Group's total assets were **HKD 291.7 million**, slightly up from **HKD 274.0 million** last year, primarily driven by an increase in non-current assets from **HKD 15 million** to **HKD 146 million**. Total liabilities rose from **HKD 104.7 million** to **HKD 137.3 million**, while total shareholders' equity decreased from **HKD 169.3 million** to **HKD 154.4 million**, with a significant reduction in cash and cash equivalents Consolidated Statement of Financial Position | Item (HKD thousand) | March 31, 2024 | March 31, 2023 | | :--- | :--- | :--- | | **Non-current Assets** | 145,973 | 14,992 | | **Current Assets** | 145,737 | 258,983 | | **Total Assets** | 291,710 | 273,975 | | **Current Liabilities** | 124,278 | 103,930 | | **Non-current Liabilities** | 13,042 | 727 | | **Total Liabilities** | 137,320 | 104,657 | | **Net Assets** | 154,390 | 169,318 | | **Equity Attributable to Owners of the Company** | 144,815 | 169,318 | | **Non-controlling Interests** | 9,575 | – | [Consolidated Statement of Changes in Equity](index=49&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) As of March 31, 2024, equity attributable to owners of the Company decreased from **HKD 169.3 million** at the beginning of the year to **HKD 144.8 million**, primarily due to a **HKD 19.9 million** loss for the year and a **HKD 4.1 million** decrease in translation reserve. Additionally, **HKD 9.6 million** in non-controlling interests was recognized due to subsidiary acquisitions and changes in non-controlling interests - Equity attributable to owners of the Company decreased from **HKD 169.3 million** to **HKD 144.8 million**, primarily due to a total comprehensive expense of **HKD 24.1 million** for the year[244](index=244&type=chunk) - Non-controlling interests were first recognized during the year due to the acquisition of subsidiaries and equity changes, with an ending balance of **HKD 9.575 million**[244](index=244&type=chunk) [Consolidated Statement of Cash Flows](index=50&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) This year, the Group's net cash and cash equivalents decreased by **HKD 122.6 million**. Net cash outflow from operating activities was **HKD 56.7 million**, primarily impacted by working capital changes. Net cash outflow from investing activities amounted to **HKD 90.5 million**, mainly for purchasing property, plant, and equipment and acquiring associates. Net cash inflow from financing activities was **HKD 24.6 million**, derived from new borrowings Consolidated Statement of Cash Flows | Item (HKD thousand) | 2024 | 2023 | | :--- | :--- | :--- | | **Net Cash Used in Operating Activities** | (56,690) | (17,535) | | **Net Cash Used in Investing Activities** | (90,478) | (907) | | **Net Cash Generated from Financing Activities** | 24,616 | 33,615 | | **Net (Decrease) Increase in Cash and Cash Equivalents** | (122,552) | 15,173 | | **Cash and Cash Equivalents at Beginning of Year** | 153,344 | 139,538 | | **Cash and Cash Equivalents at End of Year** | 23,921 | 153,344 | [Notes to the Consolidated Financial Statements](index=50&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) This section provides detailed explanations and supplementary information for the financial statements, covering accounting policies, detailed segment results, composition of significant assets and liabilities, related party transactions, contingent liabilities, capital commitments, and post-reporting period events. Key highlights include a significant decline in oil business revenue as the primary driver of overall revenue decrease, substantial capital expenditure and losses in the bio-energy business during its large-scale investment and construction phase, the Group's phased acquisition of associate 'Biaofa Eco (Juancheng)' into a controlled subsidiary, and increased borrowings from related parties to support new business development - **Segment Information (Note 6)**: The Group is divided into four segments: construction and engineering, oil, agriculture, and bio-energy. The oil business segment's performance shifted from profit to loss, while the newly invested bio-energy business segment recorded a **HKD 4.55 million** loss[426](index=426&type=chunk)[428](index=428&type=chunk) - **Trade Receivables (Note 22)**: Net trade receivables decreased from **HKD 44.7 million** to **HKD 13.9 million**. Receivables aged over 180 days constitute a higher proportion of the total, amounting to **HKD 23.23 million**[483](index=483&type=chunk)[486](index=486&type=chunk) - **Borrowings (Note 28)**: Total borrowings significantly increased from **HKD 14.87 million** to **HKD 61.08 million**, with new borrowings primarily from company directors and related parties to support business development[507](index=507&type=chunk)[509](index=509&type=chunk)[510](index=510&type=chunk) - **Step Acquisition (Note 43)**: During the year, the Group's investment in 'Biaofa Eco (Juancheng)' transitioned from an associate to a controlled subsidiary, with the transaction treated as an acquisition of a group of assets and liabilities rather than a business combination[602](index=602&type=chunk)[603](index=603&type=chunk) - **Capital Commitments (Note 42)**: As of the reporting period end, the Group had capital commitments of approximately **HKD 186 million**, primarily for unpaid registered capital of subsidiaries (**HKD 108 million**) and construction costs for property, plant, and equipment (**HKD 77.75 million**)[599](index=599&type=chunk) - **Events After Reporting Period (Note 44)**: In May 2024, subsidiary Biaofa Eco (Juancheng) entered into a loan agreement with a principal amount of **RMB 50 million** to support its development[604](index=604&type=chunk) [Financial Summary](index=147&type=section&id=Financial%20Summary) This section provides a summary of the Group's performance, assets, and liabilities over the past five fiscal years. Data indicates significant fluctuations in the Group's revenue over the past five years, peaking in FY2023 before declining in FY2024. In terms of profitability, the Group has recorded losses for the past three consecutive years. Asset size has continuously grown over the past five years, while total liabilities have significantly increased in the last two years Five-Year Financial Performance Summary | Year Ended March 31 (HKD thousand) | 2024 | 2023 | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenue** | 489,794 | 661,230 | 306,558 | 221,894 | 295,885 | | **Profit (Loss) for the Year** | (20,133) | (8,829) | (21,010) | 1,006 | 1,043 | Five-Year Financial Position Summary | As of March 31 (HKD thousand) | 2024 | 2023 | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Assets** | 291,710 | 273,975 | 253,754 | 149,411 | 159,164 | | **Total Liabilities** | (137,320) | (104,657) | (108,430) | (31,706) | (42,465) | | **Total Equity** | 154,390 | 169,318 | 145,324 | 117,705 | 116,699 |

[Financial Performance](index=2&type=section&id=Annual%20Results%20Announcement) The Group's FY2024 financial performance reflects declining revenue, expanded losses, and shifts in its financial position [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) Revenue declined 25.9% to HKD 490 million, gross profit fell 82.7%, and loss expanded to HKD 20.13 million Consolidated Statement of Profit or Loss and Other Comprehensive Income (Thousand HKD) | Indicator | 2024 (Thousand HKD) | 2023 (Thousand HKD) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 489,794 | 661,230 | -25.9% | | Gross Profit | 3,816 | 22,116 | -82.7% | | Loss Before Tax | (20,353) | (7,351) | +176.9% | | Loss for the Year | (20,133) | (8,829) | +128.0% | | Loss Attributable to Owners of the Company | (19,940) | (8,829) | +125.8% | | Basic Loss Per Share (HK cents) | (1.33) | (0.63) | +111.1% | [Consolidated Statement of Financial Position](index=3&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) Total assets slightly increased to HKD 292 million, but net current assets and net assets decreased, with total liabilities rising Consolidated Statement of Financial Position (Thousand HKD) | Indicator | March 31, 2024 (Thousand HKD) | March 31, 2023 (Thousand HKD) | Change | | :--- | :--- | :--- | :--- | | Non-current Assets | 145,973 | 14,992 | +873.7% | | Current Assets | 145,737 | 258,983 | -43.7% | | **Total Assets** | **291,710** | **273,975** | **+6.5%** | | Current Liabilities | 124,278 | 103,930 | +19.6% | | Non-current Liabilities | 13,042 | 727 | +1694.0% | | **Total Liabilities** | **137,320** | **104,657** | **+31.2%** | | **Net Assets** | **154,390** | **169,318** | **-8.8%** | | Cash and Cash Equivalents | 23,921 | 153,344 | -84.4% | [Notes to the Financial Statements](index=4&type=section&id=Notes) Detailed notes on accounting policy changes, revenue breakdown, and key financial items provide context to the financial statements [2. Application of New and Revised Hong Kong Financial Reporting Standards](index=4&type=section&id=2.%20Application%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group adopted new and revised HKFRS, including changes related to accounting estimates and deferred tax, with no significant financial impact - The Group first applied several new and revised Hong Kong Financial Reporting Standards this year, including HKAS 8, 12, and 1, but these amendments had no significant impact on the Group's financial statements[9](index=9&type=chunk)[12](index=12&type=chunk)[14](index=14&type=chunk) - In response to the abolition of the MPF offsetting mechanism against long service payments in Hong Kong, the Group changed its accounting policy, recognizing an adjustment of **HKD 73,000** in the current period due to its minor financial impact, without retrospective adjustment[19](index=19&type=chunk)[20](index=20&type=chunk)[23](index=23&type=chunk) [3. Revenue](index=9&type=section&id=3.%20Revenue) Total revenue decreased to HKD 490 million, primarily due to a decline in petroleum business, partially offset by growth in construction and agriculture Revenue by Business Segment (Thousand HKD) | Business Segment | 2024 (Thousand HKD) | 2023 (Thousand HKD) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Construction and Engineering Related | 202,411 | 153,871 | +31.5% | | Petroleum Business | 222,971 | 503,207 | -55.7% | | Agricultural Business | 59,015 | 1,101 | +5259.2% | | **Total Revenue from Contracts with Customers** | **484,397** | **658,179** | **-26.4%** | Revenue by Geographical Market (Thousand HKD) | Geographical Market | 2024 (Thousand HKD) | 2023 (Thousand HKD) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Hong Kong | 201,526 | 127,486 | +58.1% | | Mainland China | 282,871 | 530,693 | -46.7% | | **Total** | **484,397** | **658,179** | **-26.4%** | [Notes on Key Financial Items](index=10&type=section&id=Notes%20on%20Key%20Financial%20Items) The Group recorded a net reversal of expected credit loss allowance, increased finance costs, an income tax credit, and no dividend distribution - A net reversal of impairment loss allowance under the expected credit loss model of **HKD 5.143 million** was recorded, compared to an impairment loss of **HKD 6.161 million** in the prior year, primarily due to reversal of impairment on trade receivables[32](index=32&type=chunk) - Finance costs increased to approximately **HKD 1.34 million** from approximately **HKD 0.7 million** in the prior year, mainly due to increased interest on other borrowings[34](index=34&type=chunk) - No dividends were paid or proposed for the current year[38](index=38&type=chunk) [Management Discussion and Analysis](index=15&type=section&id=Management%20Discussion%20and%20Analysis) Management's review of business operations, financial performance, liquidity, key risks, future outlook, and strategic initiatives [Business Review and Outlook](index=15&type=section&id=Business%20Review%20and%20Outlook) Revenue declined due to reduced petroleum trading, offset by agriculture and construction growth, as the Group develops bio-energy and seeks new income streams amid economic challenges - Annual revenue decreased to **HKD 489.8 million**, primarily due to reduced petroleum trading business in mainland China, partially offset by growth in agricultural and construction businesses[43](index=43&type=chunk) - The Group is actively expanding its bio-energy business, investing in a rural biomass comprehensive utilization project in Shandong Province, which aims to convert organic waste into green natural gas, aligning with national rural revitalization and green development strategies[43](index=43&type=chunk)[44](index=44&type=chunk) - Looking ahead, macroeconomic slowdown and rising interest rates will pressure business, prompting the Group to adopt a cautious strategy and actively seek new opportunities to expand revenue sources[46](index=46&type=chunk) [Financial Review](index=18&type=section&id=Financial%20Review) Revenue declined 25.9% to HKD 490 million, gross profit fell 82.7% to HKD 3.8 million, and loss expanded to HKD 20.1 million Financial Review (Million HKD) | Item | FY2024 (Million HKD) | FY2023 (Million HKD) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 489.8 | 661.2 | -25.9% | | Direct Costs | 486.0 | 639.1 | -24.0% | | Gross Profit | 3.8 | 22.1 | -82.7% | | Loss for the Year | 20.1 | 8.8 | +128.4% | - A reversal of expected credit loss of approximately **HKD 5.1 million** was recorded, compared to a loss of **HKD 6.2 million** last year, mainly due to the settlement of credit-impaired trade receivables during the year[57](index=57&type=chunk) - Finance costs increased due to higher borrowings during the year[60](index=60&type=chunk) [Liquidity and Financial Resources](index=20&type=section&id=Liquidity%20and%20Financial%20Resources) Cash and bank balances significantly decreased, total borrowings increased, leading to a sharp rise in gearing ratio and a decline in current ratio Liquidity and Financial Resources | Indicator | March 31, 2024 | March 31, 2023 | | :--- | :--- | :--- | | Bank Balances and Cash | Approx. **HKD 23.9 million** | Approx. **HKD 153.3 million** | | Total Interest-bearing Borrowings and Lease Liabilities | Approx. **HKD 75.3 million** | Approx. **HKD 16.6 million** | | Current Ratio | Approx. **1.2 times** | Approx. **2.5 times** | | Gearing Ratio | Approx. **48.8%** | Approx. **9.8%** | - The gearing ratio (total borrowings and lease liabilities divided by total equity) significantly increased, primarily due to the increase in total borrowings during the year[66](index=66&type=chunk)[67](index=67&type=chunk) - As of March 31, 2024, approximately **HKD 6 million** in bank deposits, approximately **HKD 3.4 million** in life insurance policies, and approximately **HKD 9.2 million** in cash collateral were pledged for bank financing or guarantees[69](index=69&type=chunk)[71](index=71&type=chunk) [Principal Risks and Uncertainties](index=16&type=section&id=Principal%20Risks%20and%20Uncertainties) The Group faces operational, financial, and market risks, including contract dependency, litigation, cost volatility, labor supply, macroeconomic shifts, and agricultural specific challenges - Business risks include the non-recurring nature of contracts, potential legal disputes, cost fluctuations, and reliance on labor supply[48](index=48&type=chunk) - Macroeconomic risks include global energy price volatility due to geopolitical pressures, such as the Russia-Ukraine conflict, impacting petroleum business performance[48](index=48&type=chunk) - Agricultural business faces natural risks (e.g., extreme weather, pests and diseases) and market risks (e.g., cyclical fluctuations in agricultural product and raw material prices)[48](index=48&type=chunk) [Significant Investments, Acquisitions, and Litigations](index=21&type=section&id=Significant%20Investments%2C%20Acquisitions%2C%20and%20Litigations) The Group increased equity in bio-energy subsidiaries through capital injection and is involved in multiple civil litigations with provisions made for some cases - The Group injected **RMB 30 million** into Biaofa Ecological (Juye) Co Ltd, increasing its equity interest to **90%** to advance its bio-energy business[79](index=79&type=chunk) - Yingxin Construction, an indirect wholly-owned subsidiary of the Group, is involved in multiple civil litigations ranging from hundreds of thousands to millions of HKD, with provisions made for some cases expected to be unsuccessful[75](index=75&type=chunk)[78](index=78&type=chunk) [Corporate Governance and Other Information](index=24&type=section&id=Corporate%20Governance%20and%20Other%20Information) Overview of the Group's corporate governance practices, including deviations from the code, and the Audit Committee's review of financial results [Corporate Governance Practices](index=24&type=section&id=Corporate%20Governance%20Practices) The company applied the Corporate Governance Code with deviations, including the Chairman and CEO being the same person, insufficient board meetings, and no director liability insurance - The company deviated from the Corporate Governance Code, with the Chairman and Chief Executive Officer positions held by the same person, Mr. Liu Zhan Cheng, which the Board believes ensures consistency in strategic planning and execution[88](index=88&type=chunk) - Other deviations include the Chairman's absence from the Annual General Meeting, fewer than four regular Board meetings during the year, and no liability insurance purchased for directors[88](index=88&type=chunk)[89](index=89&type=chunk) [Audit Committee and Results Review](index=26&type=section&id=Audit%20Committee) The Audit Committee, composed of independent non-executive directors, reviewed the financial statements, confirming compliance with accounting standards and Listing Rules - The Audit Committee, comprising three independent non-executive directors, reviewed the annual results and deemed the financial statements compliant with applicable accounting standards and Listing Rules[93](index=93&type=chunk) - The company's auditor has reconciled the financial data in this results announcement with the annual audited consolidated financial statements[94](index=94&type=chunk)

Financial Performance - The company reported a revenue of HKD 304,606 thousand for the six months ended September 30, 2023, compared to HKD 319,348 thousand for the same period in 2022, representing a decrease of approximately 4.6%[21] - The gross profit for the period was HKD 3,950 thousand, with a gross margin of approximately 1.3%[21] - The net loss for the period was HKD 7,097 thousand, compared to a net loss of HKD 8,922 thousand in the same period last year, indicating an improvement of approximately 20.4%[21] - The total comprehensive expenses for the period amounted to HKD 11,576 thousand, down from HKD 13,306 thousand in the previous year, reflecting a decrease of approximately 13.0%[21] - The company reported a basic loss per share of HKD 0.48 for the period, compared to HKD 0.66 in the same period last year[21] - Total revenue for the six months ended September 30, 2023, was HKD 301,735,000, a decrease of 5.5% from HKD 319,348,000 in the same period of 2022[34] - The company reported a loss of HKD 7,097,000 for the six months ended September 30, 2023, compared to a loss of HKD 8,922,000 in the same period of 2022, representing a 20.4% improvement[58] - Direct costs decreased from approximately HKD 317.0 million for the six months ended September 30, 2022, to approximately HKD 300.7 million for the same period in 2023, a reduction of about HKD 16.4 million or 5.2%[96] - Administrative and other operating expenses increased by approximately 3.6% from about HKD 10.3 million for the six months ended September 30, 2022, to about HKD 10.7 million for the same period in 2023[97] Revenue Breakdown - Revenue from the Hong Kong market increased to HKD 110,818,000, up 64.3% from HKD 67,466,000 year-on-year[34] - Revenue from mainland China decreased to HKD 190,917,000, down 24.2% from HKD 251,882,000 year-on-year[34] - The construction and engineering segment generated revenue of HKD 111,722,000, while the oil business contributed HKD 185,446,000, and the agriculture segment generated HKD 7,438,000[49] - The group reported total revenue from construction and engineering-related services of HKD 111,722 for the six months ended September 30, 2023, up from HKD 68,972 for the same period in 2022, representing an increase of approximately 62%[63] - The oil business generated sales of HKD 185,446 for the six months ended September 30, 2023, down from HKD 250,376 for the same period in 2022, a decrease of approximately 26%[63] Assets and Liabilities - The total assets as of September 30, 2023, were HKD 188,018 thousand, down from HKD 258,983 thousand as of March 31, 2023[10] - The company's equity decreased to HKD 157,742 thousand from HKD 169,318 thousand as of March 31, 2023, representing a decline of approximately 6.8%[24] - The total assets of the reportable segments as of September 30, 2023, amounted to HKD 195,855,000, with total liabilities of HKD 57,129,000[50] - The company's total assets as of September 30, 2023, were approximately HKD 214.9 million, down from approximately HKD 274.0 million as of March 31, 2023[100] - The debt-to-asset ratio increased to approximately 15.4% as of September 30, 2023, compared to about 9.8% as of March 31, 2023, primarily due to increased bank borrowings[101] Cash Flow and Financing - The company experienced a net cash outflow from operating activities of HKD 83,246 thousand, compared to HKD 82,591 thousand in the previous year[29] - The company's cash and cash equivalents at the end of the period were HKD 59,949 thousand, an increase from HKD 51,565 thousand at the end of the same period last year[29] - As of September 30, 2023, the company had cash and bank balances of approximately HKD 59.9 million, down from approximately HKD 153.3 million as of March 31, 2023[116] - The group had additional borrowings of approximately HKD 29,852,000 during the six months ended September 30, 2023, compared to HKD 13,885,000 for the same period in 2022[78] Employee and Operational Expenses - Employee benefit expenses, including directors' remuneration, totaled HKD 9,256,000, an increase from HKD 8,945,000 in the previous year[56] - The group employed a total of 54 employees as of September 30, 2023, compared to 39 employees for the same period in 2022, with employee costs amounting to approximately HKD 9.3 million, up from HKD 8.9 million[133] Business Development and Strategy - The company has not disclosed any new product developments or market expansion strategies during this reporting period[21] - The company has initiated agricultural operations, including land leasing and agricultural consumables trading, marking a new business segment[36] - The company plans to invest more resources and efforts into biomass clean energy projects to create long-term stable returns for the company and its shareholders[110] - The company is actively exploring technologies and market development related to agricultural biomass comprehensive development and utilization, in response to significant market opportunities from rural revitalization policies[108] - The group aims to contribute to local rural revitalization and environmental protection through its projects, supported by national and local government initiatives[84] Litigation and Claims - The group has ongoing litigation with a client involving claims of approximately HKD 1.87 million, with a counterclaim of about HKD 409,000[122] - The group has not received any judgments regarding ongoing litigation with a subcontractor involving claims of approximately HKD 1.55 million as of September 30, 2023[123] - The group has not made any provisions for a claim of approximately HKD 6.28 million from a client, as it is deemed unlikely that the group will be held liable[130] Shareholder Information - As of September 30, 2023, Mr. Liu Zhan Cheng holds 1,118,460,000 shares, representing 74.86% of the issued share capital[168] - Fujincheng holds 1,118,460,000 ordinary shares, representing 74.86% ownership[169] - Qin Hui, as the spouse of Liu, is considered to have ownership of the same number of shares, also 74.86%[169] - As of September 30, 2023, no directors or key executives hold any reportable interests in the company's shares or related securities[171] - There are no disclosures of interests or short positions by directors or key executives as of September 30, 2023[171] - The company has no additional disclosures regarding interests or short positions from other individuals or entities as of September 30, 2023[171] Stock Options and Dividends - The company did not purchase, sell, or redeem any listed securities during the six months ended September 30, 2023[158] - The board does not recommend the payment of an interim dividend for the six months ended September 30, 2023[160] - As of September 30, 2023, no stock options were granted, exercised, expired, or lapsed under the plan for the six months ended[145] - The plan authorized the grant of 112,000,000 stock options as of April 1, 2023, and September 30, 2023[147] - The total number of shares that may be issued upon the exercise of stock options granted under the plan shall not exceed 10% of the total issued shares of the company on the date of listing[153] - No stock options were granted to any major or significant shareholders or other individuals as of September 30, 2023[157] Capital Structure and Commitments - The company has capital commitments of approximately HKD 129.1 million as of September 30, 2023, compared to HKD 128.9 million as of March 31, 2023[106] - The group’s capital structure remains unchanged, consisting solely of ordinary shares as of September 30, 2023[120]