[Performance Announcement Summary](index=1&type=section&id=Performance%20Announcement%20Summary) Kingboard Laminates Holdings Limited's FY2022 results show significant declines in revenue, profit, and EPS, reflecting a challenging market, with basic profit attributable to owners down 70% and full-year dividend per share reduced by 77% [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Kingboard Laminates Holdings Limited's FY2022 results show significant declines in revenue, profit, and EPS, reflecting a challenging market, with basic profit attributable to owners down 70% and full-year dividend per share reduced by 77% Financial Highlights | Metric | FY2022 (HK$ Million) | FY2021 (HK$ Million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 22,363.7 | 28,799.8 | -22% | | EBITDA | 4,378.6 | 9,200.3 | -52% | | Profit Before Tax | 3,451.3 | 8,386.9 | -59% | | Basic Profit Attributable to Owners | 2,002.7 | 6,781.7 | -70% | | Book Profit Attributable to Owners | 1,909.1 | 6,781.7 | -72% | | Basic EPS (HK Cents) | 64.2 | 217.4 | -70% | | Book EPS (HK Cents) | 61.2 | 217.4 | -72% | | Full-Year Dividend Per Share (HK Cents) | 35.0 | 150.0 | -77% | | Net Asset Value Per Share (HK$) | 4.82 | 6.10 | -21% | | Net Debt-to-Equity Ratio | 7% | Net Cash 150.0 | - | [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) The 2022 consolidated financial statements reveal substantial declines in revenue and profit, a sharp drop in total comprehensive income due to exchange differences, and a decrease in net assets driven by increased non-current bank borrowings [Consolidated Statement of Profit or Loss](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) In 2022, the company experienced significant declines in revenue and profit for the year, with gross profit nearly halved and finance costs substantially increased, reflecting a deteriorating operating environment and rising cost pressures Consolidated Statement of Profit or Loss | Metric | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 22,363,680 | 28,799,810 | | Cost of Sales | (17,274,238) | (19,004,119) | | Gross Profit | 5,089,442 | 9,795,691 | | Other Income, Gains and Losses | 112,931 | 84,917 | | Finance Costs | (130,392) | (80,665) | | Profit Before Tax | 3,357,766 | 8,386,915 | | Profit for the Year | 1,909,384 | 6,783,479 | | Profit Attributable to Owners of the Company | 1,909,169 | 6,781,656 | [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) In 2022, the company's profit for the year significantly decreased, and substantial exchange differences arising from translation reserves led to a sharp drop in total comprehensive income for the year from HK$7.198 billion in 2021 to HK$172 million Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Profit for the Year | 1,909,384 | 6,783,479 | | Exchange Differences Arising from Translation to Presentation Currency | (1,884,486) | 561,621 | | Loss on Debt Instruments at Fair Value Through Other Comprehensive Income | (38,979) | (121,610) | | Other Comprehensive (Expense) Income for the Year | (1,736,964) | 414,989 | | Total Comprehensive Income for the Year | 172,420 | 7,198,468 | [Consolidated Statement of Financial Position](index=4&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of year-end 2022, total assets slightly decreased, net current assets declined, and a significant increase in non-current bank borrowings led to a substantial reduction in net assets and a corresponding decrease in total capital Consolidated Statement of Financial Position | Metric | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Total Non-Current Assets | 10,578,519 | 10,518,503 | | Total Current Assets | 13,721,293 | 19,303,282 | | Total Current Liabilities | 4,707,566 | 9,778,095 | | Net Current Assets | 9,013,727 | 9,525,187 | | Total Non-Current Liabilities | 4,520,255 | 978,566 | | Net Assets | 15,071,991 | 19,065,124 | | Total Capital | 15,071,991 | 19,065,124 | [Notes to the Financial Statements](index=6&type=section&id=Notes%20to%20the%20Financial%20Statements) The notes detail the basis of financial statement preparation, revenue analysis showing a 22% decline, segment performance with CCL segment downturn and property segment growth, increased finance costs, and significant changes in receivables and payables [Basis of Preparation and Application of Accounting Standards](index=6&type=section&id=Basis%20of%20Preparation%20and%20Application%20of%20Accounting%20Standards) The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards, complying with Listing Rules and the Hong Kong Companies Ordinance, with the first-time application of revised standards having no material impact on financial position or performance - The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the HKICPA and comply with the disclosure requirements of the Hong Kong Stock Exchange Listing Rules and the Hong Kong Companies Ordinance[9](index=9&type=chunk) - Three revised Hong Kong Financial Reporting Standards were first applied this year, including References to the Conceptual Framework, COVID-19-Related Rent Concessions, and Property, Plant and Equipment—Proceeds before Intended Use[10](index=10&type=chunk)[11](index=11&type=chunk) - The application of the revised Hong Kong Financial Reporting Standards had no material impact on the Group's financial position and performance for the current and prior years[11](index=11&type=chunk) [Revenue Analysis](index=6&type=section&id=Revenue%20Analysis) In 2022, the Group's total revenue was HK$22.364 billion, a 22% decrease from 2021, with significant declines in sales of epoxy glass fiber and paper copper clad laminates, but a substantial increase in property sales revenue Revenue Sources | Source of Revenue | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Sales of Epoxy Glass Fiber Copper Clad Laminates | 12,443,665 | 20,795,401 | | Sales of Paper Copper Clad Laminates | 1,544,064 | 2,240,799 | | Sales of Upstream Materials | 4,035,387 | 3,857,153 | | Sales of Properties | 3,064,620 | 592,273 | | Others (Mainly Sales of Specialty Resins) | 1,111,212 | 1,100,421 | | Revenue Recognized Over Time (Hotel Accommodation) | 44,255 | 59,813 | | Total Revenue from Contracts with Customers | 22,243,203 | 28,645,860 | | Rental Income | 61,535 | 70,838 | | Interest Income from Debt Instruments | 8,433 | 37,918 | | Dividend Income | 50,509 | 45,194 | | **Total Revenue** | **22,363,680** | **28,799,810** | - Upstream material sales include copper foil, epoxy resin, glass fiber cloth, and bleached wood pulp paper, with payment terms ranging from **0 to 120 days**[13](index=13&type=chunk) - Other income primarily includes sales of specialty resins totaling **HK$892 million** (2021: HK$776 million)[13](index=13&type=chunk) [Segment Information](index=7&type=section&id=Segment%20Information) The Group's operating segments include manufacturing and sales of copper clad laminates, properties, and investments; in 2022, the CCL segment saw significant declines in revenue and results, while the property segment experienced substantial growth, with China remaining the primary revenue source despite a decrease in revenue from the region - The Group's operating segments are primarily divided into three: (i) manufacturing and sales of copper clad laminates, (ii) properties, and (iii) investments[14](index=14&type=chunk) [Segment Revenue and Results](index=7&type=section&id=Segment%20Revenue%20and%20Results) In 2022, the copper clad laminate segment experienced significant declines in both revenue and results, while the property segment achieved substantial growth in revenue and results, and the investment segment recorded a loss Segment Revenue and Results | Segment | 2022 Revenue (HK$ Thousand) | 2022 Results (HK$ Thousand) | 2021 Revenue (HK$ Thousand) | 2021 Results (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | Copper Clad Laminates | 19,134,328 | 2,266,378 | 27,993,774 | 8,116,680 | | Properties | 3,170,410 | 1,560,948 | 722,924 | 320,693 | | Investments | 58,942 | (201,122) | 83,112 | 118,022 | | **Consolidated Total** | **22,363,680** | **3,626,204** | **28,799,810** | **8,555,395** | [Geographical Revenue Analysis](index=8&type=section&id=Geographical%20Revenue%20Analysis) China (where the Group is located) remains the primary source of external customer revenue, but 2022 saw a year-on-year decrease in revenue from China, with other Asian countries, Europe, and the Americas also experiencing fluctuating revenues Geographical Revenue | Region | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | China (Country of Domicile) | 20,804,359 | 26,666,134 | | Other Asian Countries | 1,266,750 | 1,871,965 | | Europe | 135,644 | 144,357 | | Americas | 156,927 | 117,354 | | **Total** | **22,363,680** | **28,799,810** | - Revenue from a subsidiary of Kingboard Holdings Limited, a customer of the copper clad laminate segment, was **HK$4.096 billion** (2021: HK$4.857 billion), accounting for over **10%** of total revenue for the year[19](index=19&type=chunk) [Other Income, Gains and Losses](index=8&type=section&id=Other%20Income%2C%20Gains%20and%20Losses) In 2022, total other income, gains, and losses increased to HK$113 million, primarily driven by higher interest income from bank balances and deposits, alongside a significant reduction in losses from disposal and write-off of property, plant, and equipment Other Income, Gains and Losses | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Government Grants | 56,612 | 56,491 | | Interest Income from Bank Balances and Deposits | 31,204 | 22,388 | | Loss on Disposal and Write-off of Property, Plant and Equipment | (1,821) | (20,749) | | Others | 26,936 | 26,787 | | **Total** | **112,931** | **84,917** | [Finance Costs](index=9&type=section&id=Finance%20Costs) In 2022, finance costs significantly increased to HK$130 million, primarily due to higher interest on bank borrowings and a reduction in capitalized amounts Finance Costs | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Interest on Bank Borrowings | 146,117 | 94,619 | | Estimated Interest on Contract Liabilities | – | 1,810 | | Interest on Lease Liabilities | 81 | 95 | | Less: Amount Capitalized for Construction in Progress | (15,806) | (14,049) | | Amount Capitalized for Properties Under Development | – | (1,810) | | **Total** | **130,392** | **80,665** | - Capitalized bank and other borrowing costs in 2021 included estimated interest on contract liabilities of **HK$1.81 million** and bank borrowing costs from a general borrowing pool, with a weighted average capitalization rate of **1.87%** per annum (2022: nil)[21](index=21&type=chunk) [Depreciation](index=9&type=section&id=Depreciation) Depreciation of property, plant, and equipment for 2022 was approximately HK$782 million, an increase from 2021 - Depreciation of property, plant and equipment for 2022 was approximately **HK$781.5 million**, an increase from **HK$717.9 million** in 2021[22](index=22&type=chunk) [Income Tax Expense](index=9&type=section&id=Income%20Tax%20Expense) Total income tax expense in 2022 decreased to HK$1.448 billion from 2021; China's corporate income tax rate is 25%, with a 15% preferential rate for high-tech enterprises, land appreciation tax is levied at progressive rates, and Hong Kong profits tax is calculated under a two-tiered system Income Tax Expense | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | PRC Corporate Income Tax | 427,922 | 1,295,764 | | PRC Land Appreciation Tax | 528,034 | 97,850 | | **Total** | **1,448,382** | **1,603,436** | - PRC subsidiaries are subject to a corporate income tax rate of **25%**, with high-tech enterprises enjoying a preferential rate of **15%** valid until 2024 or earlier[22](index=22&type=chunk)[23](index=23&type=chunk) - Land Appreciation Tax is levied at progressive rates ranging from **30% to 60%** on the appreciation of land value (property sales proceeds less specified direct costs)[25](index=25&type=chunk) - Hong Kong profits tax operates under a two-tiered system, with the first **HK$2 million** of assessable profits taxed at **8.25%** and the remainder at **16.5%**[25](index=25&type=chunk) [Dividends](index=10&type=section&id=Dividends) The Board proposed a final dividend of HK$0.20 per ordinary share for 2022, an 83% decrease from HK$1.20 in 2021, with the 2022 interim dividend also down 50% year-on-year Dividends Declared and/or Paid | Dividend Type | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | 2022 Interim Dividend (HK$0.15 per share) | 468,000 | 936,000 | | 2021 Final Dividend (HK$1.20 per share) | 3,744,000 | 1,092,000 | | 2020 Special Final Dividend (HK$0.15 per share) | – | 468,000 | | **Total Dividends Declared and/or Paid** | **4,212,000** | **2,496,000** | - The Board proposed a 2022 final dividend of **HK$0.20** per ordinary share (2021: HK$1.20), totaling **HK$624 million** (2021: HK$3.744 billion), subject to approval at the Annual General Meeting[24](index=24&type=chunk)[26](index=26&type=chunk) [Earnings Per Share](index=11&type=section&id=Earnings%20Per%20Share) In 2022, both basic and diluted earnings per share were HK$0.612, a significant decrease from HK$2.174 in 2021, primarily due to reduced profit attributable to owners of the company Earnings Per Share | Metric | 2022 (HK$ Thousand/Thousand Shares) | 2021 (HK$ Thousand/Thousand Shares) | | :--- | :--- | :--- | | Profit for Calculation of Basic and Diluted EPS | 1,909,169 | 6,781,656 | | Weighted Average Number of Ordinary Shares for Basic EPS | 3,120,000 | 3,120,000 | | Weighted Average Number of Ordinary Shares for Diluted EPS | 3,120,000 | Not Applicable | | **Basic EPS** | **HK$0.612** | **HK$2.174** | | **Diluted EPS** | **HK$0.612** | **Not Applicable** | - The calculation of diluted EPS for 2022 did not assume the exercise of share options, as their exercise price was higher than the average market price of the company's shares during the year[27](index=27&type=chunk) [Trade and Other Receivables, Prepayments and Bills Receivable](index=11&type=section&id=Trade%20and%20Other%20Receivables%2C%20Prepayments%20and%20Bills%20Receivable) As of year-end 2022, total trade and other receivables and prepayments amounted to HK$3.834 billion, and bills receivable were HK$2.510 billion, with the combined total significantly lower than 2021, primarily due to decreases in net trade receivables and bills receivable Trade and Other Receivables, Prepayments and Bills Receivable | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Net Trade Receivables | 3,140,288 | 5,582,073 | | Prepayments to Suppliers | 183,371 | 517,652 | | Prepaid Expenses and Deposits | 84,999 | 204,704 | | Recoverable VAT | 244,531 | 190,197 | | Other Receivables | 180,552 | 144,541 | | **Total Trade and Other Receivables and Prepayments** | **3,833,741** | **6,639,167** | | Bills Receivable | 2,509,628 | 4,243,905 | | **Total** | **6,343,369** | **10,883,072** | - Trade customers are granted credit periods of up to **120 days**. As of the reporting period end, the aging of trade receivables was primarily concentrated within **0 to 90 days (HK$2.672 billion)**, with **HK$441 million** for **91 to 180 days**, and **HK$27.34 million** for **over 180 days**[29](index=29&type=chunk)[30](index=30&type=chunk) - All bills receivable have an aging of **0 to 90 days** from the invoice date and are due within one year[30](index=30&type=chunk) [Trade and Other Payables and Bills Payable](index=12&type=section&id=Trade%20and%20Other%20Payables%20and%20Bills%20Payable) As of year-end 2022, total trade and other payables amounted to HK$2.544 billion, and bills payable were HK$474 million, with the combined total decreasing from 2021, and an average credit period of 90 days Trade and Other Payables and Bills Payable | Item | 2022 (HK$ Thousand) | 2021 (HK$ Thousand) | | :--- | :--- | :--- | | Trade Payables | 964,300 | 1,050,633 | | Accrued Expenses | 496,766 | 523,032 | | Payables for Purchase of Property, Plant and Equipment | 134,314 | 124,495 | | Other Taxes Payable | 661,868 | 726,214 | | VAT Payable | 136,536 | 222,553 | | Land Appreciation Tax Payable | 61,096 | 10,672 | | Other Payables | 89,485 | 75,038 | | **Total Trade and Other Payables** | **2,544,365** | **2,732,637** | | Bills Payable | 474,379 | 602,496 | | **Total** | **3,018,744** | **3,335,133** | - The aging of trade payables is primarily concentrated within **0 to 90 days (HK$859 million)**, with an average credit period of **90 days** for goods purchased[32](index=32&type=chunk) - Bills payable include amounts due for the purchase of property, plant and equipment totaling **HK$10.15 million** (2021: HK$30.63 million), all due within **90 days** after the end of the reporting period[31](index=31&type=chunk)[32](index=32&type=chunk) [Business Review and Outlook](index=13&type=section&id=Business%20Review%20and%20Outlook) The business review highlights a challenging 2022 with declining CCL demand and revenue, but strong property segment growth, while the outlook anticipates industry recovery, strategic capacity expansion, and enhanced operational efficiency [Business Review](index=13&type=section&id=Business%20Review) In 2022, geopolitical conflicts, recurring domestic epidemics, and global high inflation led to a decline in electronics industry demand, causing CCL sales volume and unit prices to fall; the Group made impairment provisions for inventory but achieved over HK$2 billion in basic profit attributable to owners through vertical integration and cost control, while the property segment saw significant revenue growth due to increased residential property deliveries, and the Group made a HK$186.5 million credit impairment provision for bond investments - The market for copper clad laminates and upstream materials saw a significant increase in supply, but demand in the electronics industry declined due to geopolitical conflicts, domestic epidemics, and global high inflation, leading to a fall in CCL sales volume and unit prices[34](index=34&type=chunk) - The Group made impairment provisions for inventories of copper clad laminates and upstream materials but still recorded over **HK$2 billion** in basic profit attributable to owners of the company, leveraging its vertically integrated industrial chain and cost control[34](index=34&type=chunk) - The property segment's revenue significantly increased due to a rise in residential property deliveries during the year; the Group made a credit impairment provision of **HK$186.5 million** for its bond investments[34](index=34&type=chunk) Key Financial Performance in 2022 | Metric | 2022 (HK$ Million) | 2021 (HK$ Million) | Change (%) | | :--- | :--- | :--- | :--- | | Full-Year Revenue | 22,363.7 | 28,799.8 | -22% | | Basic Profit Attributable to Owners of the Company | 2,002.7 | 6,781.7 | -70% | [Financial Highlights](index=14&type=section&id=Financial%20Highlights_Business%20Review) This section reiterates key financial data for FY2022, showing significant declines in revenue, profit, and EPS, a substantial reduction in full-year dividend per share, and a shift in net debt-to-equity ratio from net cash to 7% Financial Highlights | Metric | FY2022 (HK$ Million) | FY2021 (HK$ Million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 22,363.7 | 28,799.8 | -22% | | EBITDA | 4,378.6 | 9,200.3 | -52% | | Profit Before Tax | 3,451.3 | 8,386.9 | -59% | | Basic Profit Attributable to Owners | 2,002.7 | 6,781.7 | -70% | | Basic EPS (HK Cents) | 64.2 | 217.4 | -70% | | Full-Year Dividend Per Share (HK Cents) | 35.0 | 150.0 | -77% | | Net Asset Value Per Share (HK$) | 4.82 | 6.10 | -21% | | Net Debt-to-Equity Ratio | 7% | Net Cash 150.0 | - | [Business Performance](index=14&type=section&id=Business%20Performance) The copper clad laminate segment's revenue decreased by 32%, but product portfolio optimization and cost control mitigated the impact of declining market demand and rising costs, while the property segment's revenue surged 3.4 times due to increased residential property deliveries [Copper Clad Laminates Segment](index=14&type=section&id=Copper%20Clad%20Laminates%20Segment) The copper clad laminate segment's revenue decreased by 32% to HK$19.134 billion; despite declining electronics industry demand, the segment effectively controlled costs by expanding new markets, optimizing product mix (e.g., thin, lead-free, halogen-free, flame-retardant, high-frequency, high-speed CCLs), and improving production technology and automation, but slow inventory turnover and falling unit prices led to impairment provisions for inventory, resulting in a 65% decrease in EBITDA - The copper clad laminate segment's revenue decreased by **32%** to **HK$19.134 billion**[36](index=36&type=chunk) - The segment actively expanded into new markets and optimized its product portfolio, with a significant increase in sales proportion of high-end, high-value-added products such as thin, lead-free, halogen-free, flame-retardant, high-frequency, and high-speed copper clad laminates[36](index=36&type=chunk) - Improvements in production technology, enhanced production efficiency, reduced energy consumption, and increased automation of production equipment effectively mitigated pressures from high commodity, energy, and transportation costs[36](index=36&type=chunk) - Due to slower inventory turnover and falling product unit prices in the first two months of 2023, impairment provisions were made for inventory, leading to a **65%** decrease in EBITDA to **HK$3.0477 billion**[36](index=36&type=chunk) [Property Segment](index=15&type=section&id=Property%20Segment) The property segment continued to focus on its CCL business development strategy, primarily selling remaining inventory during the year; due to increased residential property deliveries, segment revenue rose **3.4 times** to HK$3.170 billion, and EBITDA increased **3.7 times** to HK$1.576 billion - The property segment primarily focused on selling remaining inventory during the year, with revenue increasing **3.4 times** to **HK$3.170 billion**[37](index=37&type=chunk) - EBITDA increased **3.7 times** to **HK$1.576 billion**[37](index=37&type=chunk) [Liquidity and Financial Position](index=15&type=section&id=Liquidity%20and%20Financial%20Position) The Group maintained a sound liquidity and financial position with net current assets of approximately HK$9.013 billion and a current ratio of 2.91; net working capital turnover period shortened to 86 days, and the net debt-to-equity ratio shifted from net cash to 7% primarily due to investments in new production facilities, while the successful signing of a HK$7 billion five-year sustainability-linked loan agreement reflects banking sector confidence in its ESG efforts - As of December 31, 2022, net current assets were approximately **HK$9.0137 billion** (2021: HK$9.5252 billion), and the current ratio was **2.91** (2021: 1.97)[38](index=38&type=chunk) - Net working capital turnover period decreased from **102 days** in 2021 to **86 days** in 2022[38](index=38&type=chunk) Working Capital Turnover Period | Metric | 2022 (Days) | 2021 (Days) | | :--- | :--- | :--- | | Inventory Turnover Period | 51 | 51 | | Trade Receivables Turnover Period | 66 | 83 | | Trade Payables and Bills Payable Turnover Period | 31 | 32 | - As of December 31, 2022, the net debt-to-equity ratio was approximately **7%** (2021: net cash of HK$150 million), primarily due to investments of approximately **HK$2.4 billion** in new production facilities during the year[39](index=39&type=chunk) - The ratio of short-term to long-term borrowings was **5%:95%** (2021: 67%:33%)[39](index=39&type=chunk) - The Group successfully signed a **HK$7 billion** five-year sustainability-linked loan agreement with **14 banks**, reflecting the banking sector's confidence in the Group's ESG efforts[39](index=39&type=chunk) [Human Resources](index=15&type=section&id=Human%20Resources) As of year-end 2022, the Group's total headcount was approximately 10,300, an increase from 2021; the Group offers competitive remuneration and grants share options and special bonuses based on the company's financial performance and individual employee performance - As of December 31, 2022, the Group employed approximately **10,300 staff** (2021: 9,900 staff)[40](index=40&type=chunk) - The Group offers competitive remuneration packages and grants share options and special bonuses based on the company's financial performance and individual employee performance[40](index=40&type=chunk) [Outlook](index=16&type=section&id=Outlook) Despite weak CCL market demand in early 2023, the industry is expected to enter a new growth cycle; the Group plans to enhance competitiveness through new plant construction, expanded upstream material capacity, overseas market expansion, big data management, MES system adoption, and distributed solar PV power stations, anticipating continuous market share growth - The copper clad laminate industry is expected to enter a new growth cycle with the easing of pandemic measures and recovery of the consumer market[41](index=41&type=chunk) - The Group's newly built copper clad laminate plant in Shaoguan, Guangdong, has commenced full operation, accelerating the upgrade of products such as thin, flame-retardant, high-frequency, high-speed, and lead-free, halogen-free copper clad laminates[41](index=41&type=chunk) - The Group is actively expanding upstream material capacity, including increasing glass yarn capacity by **4,200 tons** per month and copper foil capacity by **1,050 tons** per month in Lianzhou, Guangdong, increasing glass fabric capacity by **13 million meters** per month in Shaoguan, and planning to further increase copper foil capacity by **750 tons** per month in Lianzhou in the first half of 2023[41](index=41&type=chunk) - The Group will increase copper clad laminate and upstream material capacity in Thailand to strengthen its expansion into overseas markets[41](index=41&type=chunk) - To enhance management efficiency, the Group is developing big data management and will adopt a modern Manufacturing Execution System (MES) to improve production efficiency[42](index=42&type=chunk) - In response to carbon neutrality goals, the Group is progressively constructing distributed solar photovoltaic power station projects at various factories, expected to recover costs within **five years** and generate long-term benefits[42](index=42&type=chunk) [Other Important Matters](index=16&type=section&id=Other%20Important%20Matters) This section covers the proposed final dividend, share transfer registration closure, adherence to corporate governance codes, confirmation of no listed securities transactions, and the Audit Committee's review of financial reporting [Final Dividend](index=17&type=section&id=Final%20Dividend) The Board proposed a final dividend of HK$0.20 per share, payable on July 6, 2023, to shareholders registered on June 20, 2023, subject to approval at the Annual General Meeting - A final dividend of **HK$0.20** per share is proposed, subject to approval at the Annual General Meeting on **May 29, 2023**[44](index=44&type=chunk) - The dividend will be paid on **July 6, 2023**, to shareholders registered on the company's share register on **June 20, 2023**[44](index=44&type=chunk) [Closure of Register of Members](index=17&type=section&id=Closure%20of%20Register%20of%20Members) To determine shareholders' eligibility to attend the Annual General Meeting and receive the final dividend, the company will suspend share transfer registration in two separate periods - To determine shareholders' eligibility to attend and vote at the 2023 Annual General Meeting, the share transfer registration will be suspended from **May 23 to May 29, 2023**[45](index=45&type=chunk) - To determine shareholders' entitlement to the proposed final dividend, the share transfer registration will be suspended from **June 16 to June 20, 2023**[45](index=45&type=chunk) [Corporate Governance and Compliance](index=17&type=section&id=Corporate%20Governance%20and%20Compliance) The company's directors confirm that as of year-end 2022, the company has adopted and consistently complied with the Corporate Governance Code under Appendix 14 and the Model Code for Securities Transactions by Directors of Listed Issuers under Appendix 10 of the Listing Rules - The company has adopted and consistently complied with the Corporate Governance Code set out in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited during the year 2022[46](index=46&type=chunk) - Each director confirms compliance with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rules throughout the year 2022[47](index=47&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=18&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities on the Hong Kong Stock Exchange during the year 2022 - Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities on The Stock Exchange of Hong Kong Limited during the year 2022[48](index=48&type=chunk) [Audit Committee](index=18&type=section&id=Audit%20Committee) The Audit Committee, in conjunction with management, reviewed the Group's accounting policies and practices, discussed audit, internal control, and financial reporting matters, including the audited financial reporting information for the year ended 2022 - The Audit Committee, in conjunction with management, reviewed the accounting policies and practices adopted by the Group and discussed matters relating to audit, internal control, and financial reporting[49](index=49&type=chunk) - The Audit Committee has reviewed the audited financial reporting information of the Group for the year ended December 31, 2022[49](index=49&type=chunk) [Scope of Work of the Auditor](index=18&type=section&id=Scope%20of%20Work%20of%20the%20Auditor) The company has agreed with auditor Deloitte Touche Tohmatsu that the preliminary announced financial data are consistent with the amounts presented in the audited consolidated financial statements approved by the Board; Deloitte's work does not constitute an assurance engagement, thus no opinion or assurance conclusion is expressed - The company has agreed with its auditor, Deloitte Touche Tohmatsu, that the financial figures in the preliminary announcement are consistent with the amounts presented in the audited consolidated financial statements approved by the Board[50](index=50&type=chunk) - Deloitte's work does not constitute an assurance engagement, and accordingly, no opinion or assurance conclusion is expressed on the preliminary announcement[50](index=50&type=chunk) [Acknowledgements](index=16&type=section&id=Acknowledgements) The Board extends its sincere gratitude to shareholders, customers, banks, management, and staff for their unwavering support to the Group over the past year - The Board extends its sincere gratitude to shareholders, customers, banks, management, and staff for their unwavering support to the Group over the past year[43](index=43&type=chunk)

Financial Performance - Revenue for the six months ended June 30, 2022, was HKD 13,175,953, a decrease of 5.3% compared to HKD 13,919,956 in the same period of 2021[3] - Gross profit for the same period was HKD 4,003,117, down 15.2% from HKD 4,723,013 in 2021[3] - Profit for the period attributable to equity holders was HKD 1,825,883, a decline of 45.5% compared to HKD 3,356,539 in 2021[3] - Basic earnings per share decreased to HKD 0.585 from HKD 1.076, representing a drop of 45.6%[3] - Total comprehensive income for the period was HKD 1,076,406, down 70.0% from HKD 3,588,939 in the previous year[4] - The group reported a profit before tax of HKD 2,819,638, compared to HKD 4,111,352 in the previous year, reflecting a decrease of 31.4%[21][23] - The group’s revenue from upstream materials sales was HKD 1,879,190, an increase of 7.9% from HKD 1,740,739 in the previous year[17] - The group recorded a credit impairment provision of HKD 181.7 million for its bond investments during the review period[46] Cash Flow and Assets - The company reported a net cash inflow from operating activities of HKD 2,477,352, an increase from HKD 2,271,026 in the previous year[12] - The net cash used in investing activities was HKD (500,369), compared to a cash inflow of HKD 160,975 in the prior year[12] - The net cash used in financing activities was HKD (375,185), a significant decrease from HKD (4,309,286) in the previous year[12] - The total cash and cash equivalents at the end of the period increased to HKD 4,466,687 from HKD 3,032,680 year-over-year[12] - The company reported a significant increase in total assets to HKD 16,291,001 as of June 30, 2022, compared to HKD 14,388,000 in the previous year[10] - The group’s total liabilities increased to HKD 3,119.34 million from HKD 3,335.13 million year-on-year, indicating a slight decrease[36] - The group’s total assets as of June 30, 2022, were reported at HKD 8,214.55 million, down from HKD 10,883.07 million year-on-year, a decline of 24.5%[33] Market and Product Development - The company plans to focus on new product development and market expansion strategies to improve future performance[2] - The company plans to expand its market presence and invest in new technologies to enhance operational efficiency[11] - The group has strategically expanded its copper-clad laminate production facilities in Shaoguan, Guangdong, which are now fully operational[62] - The group aims to enhance production efficiency through the adoption of modern manufacturing execution systems (MES) and big data management[62] Shareholder and Governance Information - The company reported a total of 2,301,434,000 shares outstanding, representing 73.76% of the issued share capital as of June 30, 2022[71] - Major shareholder Hallgain Management Limited holds 2,301,434,000 shares, accounting for 73.76% of the total issued shares[71] - The company has adopted and complied with the corporate governance code as per the Hong Kong Stock Exchange Listing Rules during the reporting period[73] - The company’s audit committee has reviewed the accounting policies and practices adopted by the group for the six months ending June 30, 2022[73] Dividends and Share Options - The interim dividend declared for the six months ended June 30, 2022, is HKD 0.15 per share, down from HKD 0.30 per share in the previous year[29] - The estimated fair value of the options granted is HKD 48,000,000, with HKD 37,724,000 attributed to directors and HKD 10,276,000 to employees[40] - The options have a validity period of 10 years from the grant date[41] Financial Position and Debt - The group has significant financial guarantees amounting to HKD 107.2 million as of June 30, 2022, down from HKD 215.1 million at the end of the previous year[43] - The total net debt-to-capital ratio of Guangzhou R&F Properties increased from 130% as of December 31, 2021, to 146% as of June 30, 2022[52] - The actual interest rates for bank borrowings ranged from 1.95% to 3.75% as of June 30, 2022, compared to 1.18% to 3.35% as of December 31, 2021[58] Employee and Operational Metrics - The group employed approximately 10,700 staff as of June 30, 2022, up from 9,900 staff as of December 31, 2021[61] - The group has increased its glass fiber production capacity by 4,200 tons per month and copper foil production capacity by 300 tons per month in Guangdong Province[62]

Financial Performance - Revenue for FY2021 reached HK$28,799.8 million, a 66% increase from FY2020's HK$17,301.2 million[12] - Profit before tax for FY2021 was HK$8,386.9 million, representing a 131% increase compared to the previous year[12] - Underlying net profit for FY2021 was HK$6,781.7 million, up 144% from HK$2,776.0 million in FY2020[12] - Earnings per share based on underlying net profit increased to HK217.4 cents, a 142% rise from HK89.8 cents in FY2020[12] - Proposed final dividend per share for FY2021 is HK120.0 cents, a 243% increase from HK35.0 cents in FY2020[12] - Net asset value per share increased by 33% to HK$6.10 from HK$4.59 in FY2020[12] - The company reported a full-year EBITDA of HK$9,200.3 million, a 114% increase from the previous year[12] - Interim dividend per share increased to HK30.0 cents, a 200% rise from HK10.0 cents in FY2020[12] Market and Operational Insights - The Group capitalized on strong market demand, expanding its market share in high-end and high-value-added products, including thin laminates and halogen-free laminates[20] - The explosive growth in demand for consumer electronics and new energy vehicles significantly contributed to the increase in laminates sales[19] - Monthly revenue and earnings reached consecutive record high levels during the review period[19] - Upstream materials such as copper foil and epoxy resins experienced shortages, leading to multiple price increases for both materials and laminates[20] - Cost control measures enabled the Group to significantly raise its profit margin despite rising material costs[20] Dividends and Shareholder Returns - The Group proposed a final dividend of HK120 cents, subject to shareholders' approval[19] - An interim dividend of HK$0.30 per share was declared, and a final dividend of HK$1.20 per share is recommended for payment to shareholders[80][83] Financial Position and Assets - As of December 31, 2021, the Group's net current assets were HK$9,525.2 million, up from HK$6,278.5 million as of December 31, 2020, representing a 51.5% increase[26] - The current ratio improved to 1.97 as of December 31, 2021, compared to 1.54 as of December 31, 2020[26] - The net working capital cycle decreased to 102 days as of December 31, 2021, down from 107 days as of December 31, 2020[26] - Trade receivables turnover days improved to 83 days as of December 31, 2021, from 97 days as of December 31, 2020[26] - The Group held net cash of HK$150.0 million as of December 31, 2021, a significant decrease from HK$3,756.1 million as of December 31, 2020[26] Investments and Capacity Expansion - In 2021, the Group invested approximately HK$1,200 million in new capacity and about HK$200 million in its property business[26] - The Group plans to expand its capacity in Shaoguan, Guangdong Province, adding a monthly capacity of 1.2 million sheets of laminates, which will be fully commissioned by the end of 2022[37] - The Group will increase upstream capacity in Qingyuan, including monthly capacities of 1,500 tonnes of copper foil and 4,200 tonnes of glass yarn[37] - The Group aims to add a monthly capacity of 13 million metres of glass fabric in Shaoguan to strengthen its vertical value chain[37] Management and Governance - The company has over 33 years of experience in marketing various industrial products, with key executives having extensive backgrounds in the laminate industry[46] - The management team includes individuals with significant experience in sales and distribution of laminates, contributing to the company's market presence[51] - The company is committed to maintaining high standards of corporate governance, with independent non-executive directors providing oversight[49] - The Board is responsible for the leadership and control of the Group, supervising management and approving strategic plans, budgets, and major investments[180] Risks and Challenges - Recent global market fluctuations and economic conditions, particularly a slowdown in the PRC economy and the impact of COVID-19, could lead to a reduction in demand for the Group's products[75] - The Group faces intense competition in its industry, which may adversely affect its financial condition and business prospects if it fails to compete effectively[75] - The management may encounter challenges related to upgrading or expanding existing facilities and training personnel, which could hinder the Group's expansion plans[75] Corporate Governance - The Company has adopted and complied with the Corporate Governance Code throughout the year ended 31 December 2021, with a deviation regarding the term of non-executive directors[177] - The independent non-executive Directors confirmed that the continuing connected transactions were entered into in the ordinary course of business and on normal commercial terms[148] - The Board currently comprises 11 members, including 4 independent non-executive Directors[196] - The Company has taken measures to ensure its corporate governance practices meet or exceed the standards set in the Code[196]

Financial Performance - For the six months ended June 30, 2021, the revenue was HKD 13,919,956 thousand, a significant increase from HKD 6,807,615 thousand in the same period of 2020, representing a growth of approximately 104.1%[4] - Gross profit for the same period was HKD 4,723,013 thousand, compared to HKD 1,631,106 thousand in 2020, indicating a gross margin improvement[4] - The profit for the period attributable to the owners of the company was HKD 3,356,539 thousand, up from HKD 732,814 thousand in 2020, reflecting a year-on-year increase of approximately 358.5%[4] - Basic and diluted earnings per share increased to HKD 1.076 from HKD 0.238, marking a substantial rise of 351.7%[4] - Total comprehensive income for the period was HKD 3,588,939 thousand, compared to HKD 511,055 thousand in the previous year, showing a significant increase[6] - The company reported a net cash inflow from operating activities of HKD 2,271,026,000 for the six months ended June 30, 2021, compared to HKD 1,166,772,000 for the same period in 2020, representing an increase of approximately 94.8%[13] - The company reported a net cash outflow from financing activities of HKD (4,309,286,000) for the first half of 2021, compared to HKD (3,375,513,000) in the same period of 2020[13] - The company’s cash and cash equivalents decreased by HKD 1,877,285,000 during the period, compared to an increase of HKD 399,821,000 in the previous year[13] Asset and Liability Management - Non-current assets as of June 30, 2021, totaled HKD 8,861,790 thousand, up from HKD 8,420,170 thousand at the end of 2020, indicating growth in asset base[7] - Current assets increased to HKD 18,467,132 thousand from HKD 17,955,745 thousand, reflecting a healthy liquidity position[7] - The company reported a net current asset value of HKD 8,273,935 thousand, compared to HKD 6,278,476 thousand in the previous year, showing improved financial stability[8] - The total liabilities decreased to HKD 10,193,197 thousand from HKD 11,677,269 thousand, indicating a reduction in financial obligations[8] - As of June 30, 2021, the group's total liabilities were HKD 2,995,528, a slight decrease from HKD 3,125,327 at the end of the previous year[37] - The group’s total trade and other payables amounted to HKD 2,831,457, a marginal increase from HKD 2,777,696 as of December 31, 2020[37] Revenue Breakdown - Revenue from the sale of epoxy glass fiber copper-clad laminates reached HKD 10,045,360,000, a significant increase from HKD 4,312,253,000 in the previous year, marking an increase of approximately 132.5%[21] - For the six months ended June 30, 2021, the revenue from the copper-clad laminate segment was HKD 13,820,159,000, representing a significant increase from HKD 6,602,298,000 for the same period in 2020[24] - The copper-clad laminate segment's revenue rose by 109% to HKD 13,820.2 million, with EBITDA increasing by 223% to HKD 4,360.3 million[46] - The real estate segment's revenue decreased by 51% to HKD 65 million, with EBITDA declining by 49% to HKD 32.3 million due to fewer units delivered[46] Profitability and Earnings - The group reported a pre-tax profit of HKD 4,111,352,000 for the six months ended June 30, 2021, compared to HKD 1,041,749,000 in the previous year, reflecting a strong performance[24][25] - The income tax expense for the six months ended June 30, 2021, was HKD 753,961,000, significantly higher than HKD 307,649,000 in 2020, primarily due to increased profitability[29] - The company declared an interim dividend of HKD 0.30 per share for the six months ended June 30, 2021, compared to HKD 0.10 per share in 2020[31] - Basic earnings per share attributable to the company's shareholders for the period was HKD 3,356,539,000, a substantial increase from HKD 732,814,000 in the previous year[32] Operational Efficiency - The turnover period for inventory decreased to 41 days from 50 days as of December 31, 2020[51] - The turnover period for trade receivables was 84 days, down from 97 days as of December 31, 2020[51] - The turnover period for trade payables was 24 days, reduced from 40 days as of December 31, 2020[51] Market and Growth Strategy - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[10] - The electronic industry remains highly prosperous, with stable demand for copper-clad laminates driven by strong sales of electronic consumer goods and emerging sectors like new energy vehicles and mini LED[57] - The company aims to enhance its vertical integration model and expand its external customer market by optimizing its product mix in response to market demand[57] - The overall market outlook is positive, with multiple factors expected to drive continued price increases for copper-clad laminate products[57] Governance and Compliance - The audit committee reviewed the accounting policies and practices adopted by the group for the six months ending June 30, 2021[68] - The company has complied with the Corporate Governance Code during the six-month period ending June 30, 2021, with certain deviations noted[68] - All directors confirmed compliance with the Standard Code of Conduct for securities trading during the six-month period ending June 30, 2021[68] - The board of directors includes both executive and independent non-executive members, ensuring diverse governance[70]

Financial Performance - Revenue for FY2020 was HK$17,301.2 million, a decrease of 6% from HK$18,384.0 million in FY2019[9] - Profit before tax for FY2020 was HK$3,635.8 million, an increase of 7% compared to HK$3,408.2 million in FY2019[9] - Underlying net profit for FY2020 was HK$2,776.0 million, up 11% from HK$2,493.3 million in FY2019[9] - Reported net profit for FY2020 was HK$2,802.9 million, a 17% increase from HK$2,402.2 million in FY2019[9] - Earnings per share based on underlying net profit for FY2020 was HK$0.898, an increase of 11% from HK$0.809 in FY2019[9] - Full-year dividend per share for FY2020 was HK$2.50, a significant increase of 213% from HK$0.80 in FY2019[9] Business Segments Performance - The Group's full-year turnover decreased by 6% to HK$17,301.2 million compared to 2019, primarily due to lower sales in the Property Division[17] - The underlying net profit increased by 11% to HK$2,776.0 million, driven by strong performance in the Laminates Division[17] - The Laminates Division's revenue rose by 1% to HK$16,367.8 million, with EBITDA increasing by 43% to HK$3,869.6 million[18] - The Property Division's revenue declined by 53% to HK$796.2 million, with EBITDA down 60% to HK$371.8 million[19] Market Outlook - The electronics industry showed resilience during the pandemic, with increased demand for computers and home electronic appliances[15] - The electronics industry is expected to continue prospering in 2021, with pent-up demand in overseas markets being released[31] - The Group anticipates a new growth cycle in the laminates industry driven by the introduction of 5G and upgrades in smart appliances[32] - The management expects strong business growth momentum to persist throughout 2021[31] Liquidity and Financial Position - The company reported a net cash position of HK$3,756.1 million, indicating a strong liquidity position[9] - The Group's net current assets as of December 31, 2020, were approximately HK$6,278.5 million, down from HK$9,386.0 million in 2019[22] - The net working capital cycle increased to 107 days as of December 31, 2020, from 88 days in 2019[22] - The Group's net cash position was HK$3,756.1 million as of December 31, 2020, with a net gearing ratio of 0%[22] Investments and Expansion Plans - The Group invested HK$1,126 million in new production facilities and HK$132 million in its property business during 2020[22] - The Group plans to add 800,000 sheets of monthly laminates capacity in Shaoguan City, Guangdong Province, and establish new facilities to add 350 tonnes of copper foil monthly[32] Corporate Governance - The Company adopted good corporate governance principles and complied with the Corporate Governance Code throughout the year ended December 31, 2020[120] - The Board consists of 11 members, including 4 independent non-executive Directors, ensuring a balance of skills and experience for effective decision-making[177] - The Company has received annual confirmations of independence from each independent non-executive Director as required under Rule 3.13 of the Listing Rules[178] - The Company emphasizes compliance with legal and regulatory requirements as part of its governance practices[173] Risk Management - The Group has identified key risks and uncertainties that may materially affect its business operations and financial condition[60] - The Group has established a comprehensive risk management and internal control system, reviewed at least annually, to ensure effective oversight of operations[199] - The risk management framework includes a defined organizational structure with clear responsibilities and authority for each department, ensuring accountability in daily operations[199] Employee Relations - The Company maintains strong relationships with employees, customers, and suppliers to foster long-term business benefits[68] - The Group regularly reviews its policies on employee remuneration and benefits to ensure alignment with market standards[68] - The workforce decreased to approximately 9,500 employees as of December 31, 2020, from 10,200 in 2019[25] Connected Transactions - The agreements with Hallgain are classified as continuing connected transactions under Chapter 14A of the Listing Rules due to Hallgain being a substantial shareholder[126] - The Group entered into a materials purchase framework agreement with KHL for the purchase of chemicals, with proposed annual caps of HK$800 million, HK$880 million, and HK$968 million for the years ending December 31, 2020, 2021, and 2022 respectively[130] - The transactions with KHL are classified as continuing connected transactions under Chapter 14A of the Listing Rules, ensuring compliance with regulatory standards[130][134] Internal Controls and Auditing - The Group has established an internal audit department to review financial, operational, risk management, compliance control, and internal control, ensuring the safeguarding of shareholders' investments and the Company's assets[197] - The Audit Committee is responsible for reviewing the external auditor's evaluation of the internal accounting controls and the scope and results of internal audit procedures[198] - The internal audit function reports directly to the Audit Committee to ensure proper execution of internal control procedures[197]

Financial Performance - Revenue for the six months ended June 30, 2020, was HKD 6,807,615 thousand, a decrease of 10.8% from HKD 7,631,220 thousand in the same period of 2019[4] - Gross profit for the period was HKD 1,631,106 thousand, down from HKD 1,848,817 thousand, reflecting a gross margin decline[4] - Profit before tax decreased to HKD 1,041,749 thousand, compared to HKD 1,334,677 thousand in 2019, representing a decline of 21.9%[4] - Net profit for the period was HKD 734,100 thousand, down 32.4% from HKD 1,086,475 thousand in the previous year[6] - Basic and diluted earnings per share decreased to HKD 0.238 from HKD 0.351, a decline of 32.2%[4] - The company reported a total comprehensive income of HKD 511,055 thousand for the period, down from HKD 1,593,888 thousand in 2019[6] - The group reported a total profit before tax of HKD 1,041,749,000 for the six months ended June 30, 2020, down from HKD 1,334,677,000 in the same period of 2019, representing a decline of about 21.9%[25] - Profit attributable to the company's shareholders decreased by 32% to HKD 732.8 million from HKD 1,082.1 million in the prior year[52] Revenue Breakdown - Sales of epoxy glass fiber copper-clad laminates amounted to HKD 4,312,253,000, slightly down from HKD 4,317,259,000 in 2019[21] - Sales of paper-covered copper laminates decreased to HKD 888,337,000 from HKD 981,863,000, representing a decline of 9.5%[21] - The company reported a decrease in customer contract revenue to HKD 6,703,341,000 from HKD 7,293,317,000, reflecting a decline of 8.1%[21] - For the six months ended June 30, 2020, the total revenue from the manufacturing and sales of copper-clad laminates was HKD 6,602,298,000, a decrease of approximately 5.4% compared to HKD 6,980,563,000 for the same period in 2019[25] - The revenue from property and investment segments was HKD 133,658,000 and HKD 71,659,000 respectively for the six months ended June 30, 2020, compared to HKD 405,935,000 and HKD 244,722,000 in 2019, indicating significant declines of 67.0% and 70.8%[25] Cash Flow and Investments - The net cash generated from operating activities was HKD 1,166,772,000, compared to HKD 1,152,213,000 in the previous year, showing a slight increase[13] - The net cash used in investing activities was HKD 2,608,562,000, a significant increase from a cash outflow of HKD 490,016,000 in 2019[13] - The net cash used in financing activities was HKD 3,375,513,000, compared to HKD 1,778,335,000 in the previous year, indicating increased financing needs[13] - The cash and cash equivalents at the end of the period increased to HKD 3,307,938,000 from HKD 2,686,987,000 in 2019[13] - The company recognized an additional HKD 34,094,000 in goodwill reserve due to the acquisition of non-controlling interests[11] Assets and Liabilities - Total assets as of June 30, 2020, were HKD 14,750,373 thousand, slightly up from HKD 14,704,287 thousand at the end of 2019[7] - Inventory increased to HKD 2,056,897 thousand from HKD 1,818,691 thousand, indicating a rise of 13.1%[7] - Cash and cash equivalents rose to HKD 3,307,938 thousand, compared to HKD 2,908,117 thousand, an increase of 13.7%[7] - The total trade receivables, net of credit loss provisions, were HKD 2,999,371,000 as of June 30, 2020, down 17.1% from HKD 3,619,001,000 at the end of 2019[37] - Trade payables amounted to HKD 928,068,000 as of June 30, 2020, a decrease of 24.7% from HKD 1,231,111,000 at the end of 2019[40] Dividends and Shareholder Information - The company declared an interim dividend of HKD 0.10 per share and a special interim dividend of HKD 1.90 per share for the six months ended June 30, 2020[33] - Hallgain Management Limited holds 2,204,546,500 shares, representing 71.55% of the company's issued share capital[80] - 建滔集團 holds 2,120,860,500 shares, accounting for approximately 68.84% of the issued share capital, with an additional 83,686,000 shares representing 2.71%[80] - Jamplan (BVI) Limited owns 1,785,000,000 shares, which is 57.94% of the issued share capital[80] Corporate Governance - The company complied with the Corporate Governance Code during the reporting period, with all directors subject to re-election at the annual general meeting[84] - The company has adopted a standard code of conduct for securities trading by directors, confirming compliance during the reporting period[84] - The audit committee reviewed the accounting policies and practices adopted by the group for the six months ending June 30, 2020[83] Strategic Focus and Future Plans - The company plans to focus on market expansion and new product development to drive future growth[3] - The group aims to refinance offshore debts through the issuance of bonds with fixed interest rates ranging from 5.875% to 9.85%[56] - The group plans to increase copper foil production capacity by 900 tons per month in the second half of 2020, following an increase of 300 tons per month in June and July[66] - The group has no plans to acquire new land reserves and will focus on completing existing real estate projects[66]

Financial Performance - The Group reported a revenue of HK$18,384.0 million for FY2019, representing an 11% decrease from HK$20,645.8 million in FY2018[13]. - Underlying net profit decreased by 22% to HK$2,493.3 million, while reported net profit fell by 26% to HK$2,402.2 million[13][22]. - The group's total revenue for 2019 decreased by 11% to HK$18.384 billion, with basic net profit (excluding exceptional items) down 22% to HK$2.493 billion[24]. - The property segment's revenue declined by 53% to HK$1,711.3 million, with EBITDA down by 40% to HK$927.1 million[23]. - EBITDA for the laminates segment decreased by 20% to HK$2,713.8 million[23]. - The average output volume of laminates was 10.6 million square meters, a 10% increase from 2018, although revenue from the laminates segment decreased by 3% to HK$16,236.9 million[23]. Dividends and Shareholder Returns - The Board proposed a final dividend of HK30.0 cents per share and a special final dividend of HK40.0 cents per share, subject to shareholders' approval[22]. - The board proposed a final dividend of HK$0.30 per share and a special final dividend of HK$0.40 per share to reward long-term shareholders[30]. - An interim dividend of HK10.0 cents per share was paid, with a recommendation for a final dividend of HK30.0 cents and a special final dividend of HK40.0 cents per share[80]. Financial Position and Ratios - The Group's net asset value per share increased by 7% to HK$6.07 from HK$5.68 in the previous year[13]. - The Group maintained a net gearing ratio of 0%, compared to 11% in the previous year[13]. - As of December 31, 2019, net current assets were approximately HK$9.386 billion, with a current ratio of 2.76, up from 2.59 in 2018[28]. - The net working capital cycle increased to 88 days from 63 days in 2018, with stock turnover days at 48 days and trade receivables turnover days at 80 days[28]. - The group registered a net gearing of 0% as of December 31, 2019, down from 11% in 2018, indicating a strong financial position[28]. Investments and Capital Expenditures - The group invested approximately HK$690 million in new production facilities and HK$270 million in its property business during 2019[28]. - The Group incurred expenditures of HK$693,317,000 during the year primarily to expand production capacity[115]. - The Group's investment properties were revalued, resulting in a fair value increase of HK$5,600,000, compared to HK$91,056,000 in 2018[93]. - The Company held approximately HK$4,739.3 million in investments, representing about 18% of the total assets as of December 31, 2019[94]. Market and Operational Outlook - The management maintains a prudently optimistic outlook for 2020, driven by global upgrades in telecommunications technologies and the emergence of 5G[41]. - The Group's laminates segment showed a strong rebound in the second half of 2019, supported by an immaculate vertical supply chain and operational efficiency[18][19]. - The Group's laminates orders continued strong momentum from the latter part of 2019, with all factories resuming full production capacity as the coronavirus epidemic comes under control in mainland China[40]. Corporate Governance and Management - The company has a dedicated audit committee and remuneration committee to ensure financial integrity and proper governance[52]. - The management team includes individuals with significant experience in sales, distribution, and manufacturing of copper-clad laminates[49]. - The Group has maintained good corporate governance principles and complied with applicable code provisions throughout the year[153]. - The independent non-executive Directors confirmed that the continuing connected transactions were conducted in the ordinary course of business and on normal commercial terms[177]. Risks and Challenges - The Group has identified key risks and uncertainties that may materially affect its business operations, financial condition, and results of operations[68]. - Intense competition in the industry may adversely affect the Group's financial condition and business prospects[73]. - Recent global market fluctuations and economic conditions have negatively impacted demand for the Group's products[73]. Connected Transactions - The Group's connected transactions with Hallgain are classified as continuing connected transactions under Chapter 14A of the Listing Rules[156]. - The Group agreed to purchase materials for laminate production from Hallgain Group for a term of three years from January 1, 2020, to December 31, 2022[165]. - The transactions under the KLHL/Hallgain PFA and KLHL/KHL MPA are considered continuing connected transactions under Chapter 14A of the Listing Rules[167]. - The actual transaction amount for the year ended December 31, 2019, under the KLHL/KHL SSFA was HK$2,223,204,000, which was below the annual cap of HK$2,299,000,000[184]. Employee and Workforce Information - The workforce as of December 31, 2019, was approximately 9,600, down from 10,200 in 2018[32]. - The remuneration paid to senior management (excluding Directors) during the year ended December 31, 2019, included 1 individual earning between HK$0 to HK$1,000,000 and 1 individual earning above HK$2,000,001[189].

Financial Performance - Revenue for the six months ended June 30, 2019, was HKD 7,631,220, a decrease of 21.2% compared to HKD 9,684,280 in 2018[5] - Gross profit for the same period was HKD 1,848,817, down 31.8% from HKD 2,712,725 in 2018[5] - Profit before tax was HKD 1,334,677, a decline of 38.9% from HKD 2,183,369 in the previous year[5] - Net profit for the period was HKD 1,086,475, representing a decrease of 39.0% compared to HKD 1,783,190 in 2018[6] - Basic and diluted earnings per share were HKD 0.351, down from HKD 0.577 in the same period last year[5] - Total comprehensive income for the period was HKD 1,593,888, compared to HKD 1,345,942 in 2018, reflecting an increase of 18.4%[6] - Basic earnings attributable to shareholders for the six months ended June 30, 2019, were HKD 1,082,085,000, down from HKD 1,778,610,000 in the same period of 2018[29] - The company experienced a 39% decline in pre-tax profit, which fell to HKD 1,334.7 million from HKD 2,183.4 million in the previous year[49] Cash Flow and Investments - The company reported a net cash inflow from operating activities of HKD 1,152,213,000 for the six months ended June 30, 2019, compared to HKD 349,491,000 in the same period of 2018, representing a significant increase[11] - The company incurred a net cash outflow from investing activities of HKD (490,016,000) for the six months ended June 30, 2019, an improvement from HKD (832,356,000) in the same period of 2018[11] - Financing activities resulted in a net cash outflow of HKD (1,778,335,000) for the current period, contrasting with a net cash inflow of HKD 1,162,395,000 in the previous year[11] - The company recognized interest income from debt instruments of HKD 235,159,000 and dividend income of HKD 9,563,000 during the reporting period[18] Assets and Liabilities - Non-current assets amounted to HKD 13,862,608 as of June 30, 2019, an increase from HKD 13,150,020 at the end of 2018[7] - Current assets totaled HKD 14,178,318, down from HKD 15,571,721 at the end of 2018[7] - Current liabilities were HKD 5,744,762, a decrease from HKD 6,016,310 in 2018[8] - Total equity attributable to shareholders was HKD 18,044,091, up from HKD 17,499,572 at the end of 2018[8] - The company’s total liabilities decreased to HKD 2,892,017 thousand from HKD 3,444,128 thousand, reflecting a decrease of approximately 15.9% year-over-year[34] Revenue Breakdown - Sales of epoxy glass fiber copper-clad laminates amounted to HKD 4,317,259,000, while sales of paper copper-clad laminates were not specified for the current period but were HKD 1,171,466,000 in the previous year[18] - The group reported segment revenue of HKD 6,980,563,000 for copper-clad laminates, HKD 405,935,000 for properties, and HKD 244,722,000 for investments, totaling HKD 7,631,220,000 for the six months ended June 30, 2019[21] - The real estate segment's revenue decreased by 36% to HKD 405.9 million due to a decline in the number of completed units delivered during the period[50] Dividends and Shareholder Information - The group declared an interim dividend of HKD 0.10 per share for the six months ended June 30, 2019, compared to HKD 0.175 per share for the same period in 2018[28] - The net asset value per share increased by 4% to HKD 5.86, compared to HKD 5.62 in the previous year[49] - As of June 30, 2019, Hallgain Management Limited holds 2,110,485,000 shares, representing approximately 68.50% of the issued share capital[79] - The company’s major shareholders include 建滔集團 with a direct and indirect interest of approximately 39.02%[80] Operational Metrics - The average monthly shipment of copper-clad laminates remained stable at 9.47 million square meters, but revenue from this segment decreased by 22% to HKD 6,906 million due to a decline in average selling prices[49] - The aging analysis of trade receivables shows that HKD 2,167,302 thousand (69.2%) are within 0 to 90 days, compared to HKD 2,228,048 thousand (67.7%) in the previous year[33] - The aging analysis of trade payables indicates that HKD 994,905 thousand (89.1%) are within 0 to 90 days, down from HKD 1,178,684 thousand (91.8%) in the previous year[35] Corporate Governance - The board of directors confirmed compliance with the corporate governance code during the six-month period ending June 30, 2019[83] - The company has adopted the standard code of conduct for securities transactions by directors, with all directors confirming compliance during the reporting period[85] - The audit committee reviewed the accounting policies and practices adopted by the group for the six-month period ending June 30, 2019[83]

Financial Performance - The Group reported a 13% increase in revenue to HK$20,645.8 million for FY2018, compared to HK$18,338.0 million in FY2017[9]. - Underlying net profit decreased by 15% to HK$3,190.1 million, down from HK$3,735.0 million in the previous year[9]. - The average selling price (ASP) increased during 2018, although the overall demand for laminates weakened[22]. - Laminates sales showed a modest decline with an average monthly shipment volume of 9.64 million square meters[22]. - The laminates division's segment revenue rose 2% to HK$16,747.3 million, while EBITDA declined 30% to HK$3,378.9 million[22]. - The property division's segment revenue increased significantly by 104% to HK$3,644.0 million, with EBITDA growth of 221% to HK$1,535.1 million[23]. - The Group's overall profitability has continuously outperformed its peers despite market challenges[15]. - The Company capitalized on its vertical laminates supply chain and effective cost control to sustain revenue growth[15]. Liquidity and Financial Position - Net gearing stood at 11%, with net cash of HK$1,062.1 million[9]. - As of December 31, 2018, the Group's net current assets were approximately HK$9,555.4 million, with a current ratio of 2.59, indicating a robust liquidity position[25]. - The Group's cash and cash equivalents amounted to approximately HK$3,803 million, with HK$8,192 million in available bank facilities, of which 71% had been utilized[25]. - The total bank borrowings amounted to approximately HK$5,843 million, with a short-term to long-term borrowing ratio of 18%:82%[25]. - The net working capital cycle decreased to 63 days from 74 days year-over-year, with inventory turnover days at 41 days and trade receivables turnover days at 59 days[25]. Investment and Expansion Plans - The Group plans to invest HK$860 million in new production capacity and HK$540 million in its property business during 2018[26]. - The introduction of consumption stimulus policies in China and investments in the 5G mobile network industrial chain are expected to drive a rebound in laminates demand in 2019[28]. - The Group has initiated expansion programs in Guangdong Province and Thailand to meet the growing demand for high-end laminates in the 5G era[29]. - The demand for copper-clad laminate products is expected to rebound due to the activation of the 5G network industry chain and domestic consumption stimulus policies[32]. - The group plans to increase production capacity in Guangdong Province, specifically in Lianzhou and Qingyuan, to enhance vertical integration[32]. - New production capacity for copper-clad laminates will be phased in this year in Jiangmen and Shaoguan, Guangdong, and Thailand, aiming to meet the demand for high-end products in the 5G era[32]. Corporate Governance and Board Composition - The Company has complied with the Corporate Governance Code throughout the year, except for the deviation regarding the appointment terms of non-executive Directors[141]. - The Group's governance practices are detailed in the Corporate Governance Report within the annual report[141]. - The Board currently consists of 12 members, including four independent non-executive Directors, ensuring compliance with Listing Rules[193]. - The Company has received annual confirmations of independence from each independent non-executive Director as required under Rule 3.13 of the Listing Rules[194]. - The Board is responsible for overseeing corporate governance policies and practices, including compliance with legal and regulatory requirements[188]. Shareholder Returns and Dividends - The Board proposed a final dividend of HK35.0 cents per share, subject to Shareholders' approval[20]. - An interim dividend of HK17.5 cents per share was paid, and a final dividend of HK35.0 cents per share is recommended for shareholders[82]. - The Company has a dividend policy aimed at allowing shareholders to participate in profits while retaining reserves for future growth[83]. - The Board will review the dividend policy as appropriate, considering financial results, distributable reserves, and future development plans[83]. Risks and Challenges - The Group has identified key risks that may materially affect its business operations, financial condition, and results, including the inability to expand production capacity[67]. - The Group's ability to obtain financing for its expansion plan will depend on its financial condition and external factors, with no assurance of obtaining adequate funds on acceptable terms[73]. - Recent global market fluctuations and economic conditions, particularly a slowdown in the PRC economy, could lead to reduced demand for the Group's products[73]. Employee Relations and Policies - The Company maintains strong relationships with employees, customers, and suppliers, recognizing employees as valuable assets and regularly reviewing remuneration policies[76]. - The Group's emolument policy for employees is based on merit, qualifications, and competence, as set by the Remuneration Committee[160]. - The share option scheme has been adopted as an incentive for Directors and eligible employees[160].