Financial Performance - The company's revenue for the fiscal year ending December 31, 2024, was HKD 6,450.1 million, representing an increase of 5.2% from HKD 6,132.9 million in 2023[3]. - Gross profit for the same period was HKD 1,002.3 million, up 20.3% from HKD 833.3 million in 2023[3]. - Profit attributable to owners of the company decreased to HKD 135.3 million, down 46.3% from HKD 251.5 million in 2023[3]. - Basic earnings per share for 2024 was HKD 0.10, compared to HKD 0.18 in 2023, reflecting a decline of 44.4%[3]. - Total comprehensive income for the year was HKD 110.2 million, down 54.9% from HKD 244.3 million in 2023[5]. - The company's total assets as of December 31, 2024, were HKD 3,699.4 million, slightly down from HKD 3,721.4 million in 2023[7]. - The company's equity attributable to owners increased to HKD 2,193.7 million from HKD 2,126.4 million in 2023, reflecting a growth of 3.2%[8]. - The group reported a total segment profit of HKD 221,830,000 for the year ended December 31, 2024[27]. - The net profit for the year ended December 31, 2024, was HKD 133,888,000, compared to the previous year's profit[27]. - The company reported a net profit of HKD 251,406,000 for the year, compared to HKD 262,619,000 in the previous year, reflecting a decrease of 4.2%[33]. Revenue Breakdown - Revenue from contracting works was HKD 5,080,980,000 in 2024, up from HKD 4,926,890,000 in 2023, representing a growth of 3.1%[22]. - Maintenance works revenue increased to HKD 1,230,123,000 in 2024 from HKD 1,069,811,000 in 2023, reflecting a growth of 15.0%[22]. - Revenue from Hong Kong increased to HKD 5,492,957,000, up 7.2% from HKD 5,123,788,000 in 2023[33]. - Revenue from mainland China decreased to HKD 214,936,000, down 43% from HKD 376,476,000 in 2023[33]. - Revenue from maintenance engineering for fiscal year 2024 was HKD 1.2301 billion, accounting for 19.0% of total revenue, reflecting a 1.5% increase from fiscal year 2023[83]. Dividends - The company declared a second interim dividend of HKD 0.02 per share, totaling approximately HKD 28 million, bringing the total dividend for the year to HKD 0.0438 per share[3]. - The company declared an interim dividend of HKD 0.02 per share for the year 2024, totaling approximately HKD 27,977,000, compared to HKD 0.01 per share totaling HKD 13,863,000 for the year 2023[40]. - The company plans to pay a second interim dividend of HKD 0.02 per share for the year ending December 31, 2024, expected to be distributed around April 29, 2025[112]. Assets and Liabilities - Current liabilities decreased to HKD 2,632.6 million from HKD 2,730.1 million in 2023, indicating improved liquidity[7]. - The total current assets for 2024 were HKD 3,699.4 million, slightly down from HKD 3,721.4 million in 2023[101]. - The total current liabilities decreased to HKD 2,632.6 million in 2024 from HKD 2,730.1 million in 2023[101]. - The total value of pledged assets increased to HKD 968,108,000 in 2024 from HKD 853,999,000 in 2023, with significant increases in investment properties[55]. - The total amount of mortgaged assets as of December 31, 2024, was HKD 968.1 million, compared to HKD 854.0 million as of December 31, 2023[98]. Financial Standards and Compliance - The company has applied the revised Hong Kong Financial Reporting Standards (HKFRS) for the first time this year, which became mandatory on January 1, 2024, without significant impact on the financial position and performance[10]. - The company has not early adopted any new or revised HKFRS that have been issued but are not yet effective, including HKFRS 9 and HKFRS 7 revisions[15]. - The application of the revised HKFRS 9 is expected to clarify the recognition and derecognition of financial assets and liabilities, with no significant impact anticipated on the group's financial condition[18]. - The revised standards aim to improve the clarity and consistency of financial reporting, ensuring better alignment with international standards[14]. - The company has adopted the principles and code provisions of the Corporate Governance Code as its corporate governance standard, ensuring compliance as of December 31, 2024[115]. Operational Developments - The company is actively developing new technologies, including AI, IoT, and energy optimization digital solutions, to position itself as a leader in emerging industries[63]. - The newly established headquarters features a design and R&D center aimed at advancing new construction technologies, including MiMEP and BIM, enhancing productivity and sustainability[62]. - The company is actively expanding its services globally, targeting projects in the Philippines and Dubai[68]. - The company has established a dedicated business unit to expand its environmental engineering and other services into new markets, including the Philippines, Dubai, and Europe[110]. - The company is expanding its elevator and escalator business in the UK and the US, with its US subsidiary turning a profit and expanding its market coverage beyond New York[109]. Employee and Training - The company employed 3,149 staff as of December 31, 2024, an increase from 3,010 staff in 2023[102]. - The company provided a total of 569 internal training sessions in 2024, totaling over 38,500 hours of training[103]. Market Position and Future Outlook - The company has achieved significant growth in order volume and bidding activities, indicating a solid foundation for future business development[108]. - The company plans to prudently seek suitable new business and investment opportunities, aiming to fully utilize the net proceeds from the global offering by December 31, 2025[93]. - The company expects that the application of the new standards will not have a significant impact on its financial statements in the foreseeable future[16].

[Company Profile](index=1&type=section&id=%E5%85%B3%E4%BA%8E%E5%AE%89%E4%B9%90%E5%B7%A5%E7%A8%8B%E9%9B%86%E5%9B%A2%E6%9C%89%E9%99%90%E5%85%AC%E5%8F%B8) ATAL Engineering Group, established in 1977, is a leading MEP engineering and technology services provider with diverse operations across Hong Kong, Macau, mainland China, the US, and the UK - The company, established in 1977, is a leading MEP engineering and technology services provider[1](index=1&type=chunk) - Business covers Building Services, Environmental, ICBT, and Lifts & Escalators segments[1](index=1&type=chunk) - Operations span Hong Kong, Macau, mainland China, the US, and the UK[1](index=1&type=chunk) [Financial Highlights](index=3&type=section&id=%E8%B4%A2%E5%8A%A1%E6%A6%82%E8%A6%81) Group revenue increased by 14.9% to HKD 3.2654 billion, but profit attributable to owners significantly decreased to HKD 82.4 million due to one-off gains in the prior period Financial Highlights for the Six Months Ended June 30 | Metric | 2024 (HKD Million) | 2023 (HKD Million) | | :------------------- | :----------------- | :----------------- | | Revenue | 3,265.4 | 2,841.1 | | Gross Profit | 477.7 | 453.8 | | Profit Attributable to Owners | 82.4 | 237.5 | | Basic Earnings Per Share | HKD 0.06 | HKD 0.17 | - Board resolved to pay an interim dividend of **HKD 2.38 cents per share**, totaling approximately **HKD 33 million** for the six months ended June 30, 2024[3](index=3&type=chunk) [Chairman's Statement](index=5&type=section&id=%E4%B8%BB%E5%B8%AD%E6%8A%A5%E5%91%8A) The Chairman's Statement highlights the Group's leadership in MEP engineering, innovation in AI-driven digital twin technology, green business, and new market expansion - Group achieved significant market share in Building Services and Environmental Engineering, with advantages in data centers and infrastructure[4](index=4&type=chunk) - Continuous R&D investment focuses on AI-driven digital twin technology for energy efficiency, building operations, ESG performance, water treatment automation, and critical facility O&M[5](index=5&type=chunk) - New headquarters, ATAL Engineering Tower, commenced operations in July 2024, enhancing service capabilities and employee productivity[7](index=7&type=chunk) - Will continue to identify projects supporting new market development and expand overseas business[5](index=5&type=chunk) [Management Discussion and Analysis](index=6&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%82%E8%AE%A8%E8%AE%BA%E5%8F%8A%E5%88%86%E6%9E%90) This section details the Group's H1 2024 business performance, financial position, segment progress, strategic priorities, and future outlook, showing robust revenue growth despite profit fluctuations from one-off factors [Interim Business Review](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E4%B8%9A%E5%8A%A1%E5%9B%9E%E9%A1%BE) H1 2024 revenue grew 14.9% to HKD 3.2654 billion, driven by data center and infrastructure projects, with adjusted profit attributable to owners at HKD 67.2 million and total contracts on hand of HKD 11.7043 billion Key Financial Indicators for H1 2024 | Metric | Amount (HKD) | | :------------------- | :---------- | | Revenue | 3.2654 billion | | Profit Attributable to Owners | 82.4 million | | Gross Profit Margin | 14.6% | | Total Contract Value on Hand | 11.7043 billion | - Revenue increased by **14.9% year-on-year**, driven by data center, medical, building, and infrastructure projects, and contributions from a UK lifts company acquisition[7](index=7&type=chunk) - Adjusted profit attributable to owners was **HKD 67.2 million**, comparable to HKD 74.7 million in the prior period, mainly due to project phasing differences[7](index=7&type=chunk) - Group focuses R&D investment and business development on innovative construction technologies (MiMEP, DfMA, BIM), smart solutions (AI-driven digital twin, energy management, renewable energy, ESG management, robotics), and new environmental technologies[9](index=9&type=chunk) [Segment Performance](index=8&type=section&id=%E4%B8%9A%E5%8A%A1%E6%9D%BF%E5%9D%97%E8%A1%A8%E7%8E%B0) All business segments showed significant progress in H1 2024, with strong revenue growth in Building Services, new projects in Environmental, key roles for ICBT in smart city transformation, and overseas expansion benefiting Lifts and Escalators [Building Services Engineering](index=8&type=section&id=%E5%B1%8B%E5%AE%87%E8%A3%9D%E5%82%99%E5%B7%A5%E7%A8%8B) Building Services Engineering revenue grew 20.8% to HKD 2.111 billion, with a contract value on hand of HKD 5.585 billion, driven by new projects and continued investment in MiMEP and BIM technologies Building Services Engineering Performance | Metric | H1 2024 (HKD Million) | H1 2023 (HKD Million) | Change Rate | | :--------------- | :------------------ | :------------------ | :---------- | | Revenue | 2,111 | 1,748 | +20.8% | | Contract Value on Hand | 5,585 | 6,150 | -9.19% | | New Contracts Awarded | 1,881 | 2,461 | -23.5% | | Recurring M&E Revenue | 205 | 184 | +11.3% | - Recently secured new MEP engineering service projects, including a Grade A office building in Causeway Bay utilizing MiMEP and a large-scale project in Macau[12](index=12&type=chunk) - Continued investment in BIM and MiMEP technologies, with a new MiMEP facility in mainland China to enhance productivity, safety, and quality[12](index=12&type=chunk) [Environmental Engineering](index=9&type=section&id=%E7%8E%AF%E5%A2%83%E5%B7%A5%E7%A8%8B) Environmental Engineering revenue remained stable at HKD 621 million, with HKD 4.514 billion in contracts on hand, securing new projects in flood prevention and wastewater treatment while expanding into overseas markets Environmental Engineering Performance | Metric | H1 2024 (HKD Million) | H1 2023 (HKD Million) | | :----------------- | :------------------ | :------------------ | | Revenue | 621 | 623 | | Contract Value on Hand | 4,514 | 4,599 | - Awarded significant engineering contracts for Yuen Long flood barriers and a new leachate wastewater treatment plant at Tuen Mun Nim Wan Landfill[13](index=13&type=chunk) - Implementing climate solutions, clean water, waste, and wastewater treatment technologies, including AI-driven digital twin technology to extend facility lifecycles[13](index=13&type=chunk) - Participating in engineering tender activities in overseas regions such as the Philippines and Dubai[13](index=13&type=chunk) [Information, Communications and Building Technology (ICBT)](index=10&type=section&id=%E8%B3%87%E8%A8%8A%E3%80%81%E9%80%9A%E8%A訊%E5%8F%8A%E5%B1%8B%E5%AE%87%E7%A7%91%E6%8A%80(ICBT)) ICBT revenue was HKD 295 million, with HKD 938 million in contracts on hand, playing a key role in smart city transformation by providing AI-driven green and smart building solutions ICBT Segment Performance | Metric | H1 2024 (HKD Million) | H1 2023 (HKD Million) | | :----------------- | :------------------ | :------------------ | | Revenue | 295 | 311 | | Contract Value on Hand | 938 | 941 | - Provides AI-driven digital twin technology, energy management, renewable energy, robotics solutions, and smart lampposts for green and smart building solutions[14](index=14&type=chunk) - Secured contracts for an AI video analytics CCTV system for a shopping mall in Southern Hong Kong Island and ELV equipment and building management systems for a residential project in Tseung Kwan O[14](index=14&type=chunk) [Lifts and Escalators](index=10&type=section&id=%E5%8D%87%E9%99%8D%E6%A9%9F%E5%8F%8A%E8%87%AA%E5%8B%95%E6%A2%AF) Lifts and Escalators revenue surged 49.4% to HKD 239 million, driven by overseas projects and acquisitions, with US associate business turning profitable despite brand impairment losses Lifts and Escalators Segment Performance | Metric | H1 2024 (HKD Million) | H1 2023 (HKD Million) | Change Rate | | :----------------- | :------------------ | :------------------ | :---------- | | Revenue | 239 | 160 | +49.4% | | Contracts on Hand | 667 | 586 | +13.8% | - US associate business turned profitable due to higher gross margins and a one-off net insurance claim income, partially offset by post-tax brand impairment losses[16](index=16&type=chunk)[28](index=28&type=chunk) - Anlev brand received "Star of Safety" for 46 consecutive quarters and five "Stars of Quality" from the Hong Kong Electrical and Mechanical Services Department[16](index=16&type=chunk) [Innovation, Resource Management and Other Operating Projects](index=11&type=section&id=%E5%89%B5%E6%96%B0%E3%80%81%E8%B3%87%E6%BA%90%E7%AE%A1%E7%90%86%E5%8F%8A%E5%85%B6%E4%BB%96%E7%B6%93%E7%87%9F%E9%A0%85%E7%9B%AE) The Group fosters an innovation culture, developing AI and robotics solutions, and successfully applying BIM, DfMA, and MiMEP in over 50% of Building Services projects - Established Smart Data Automation (SDA) business development unit to service O&M for critical facilities like water treatment plants, sewage treatment plants, and data centers[17](index=17&type=chunk) - Over **50% of Building Services Engineering projects** successfully applied BIM, DfMA, and MiMEP technologies, enhancing efficiency, quality, and safety[17](index=17&type=chunk) - Developed wastewater treatment system "AMSFS III" won the "Hong Kong Green Innovation Award," demonstrating commitment to green innovation[17](index=17&type=chunk) [Impact of COVID-19 Pandemic](index=11&type=section&id=%E6%96%B0%E5%86%A0%E7%96%AB%E6%83%85%E5%BD%B1%E9%9F%BF) The Group capitalizes on economic recovery and border reopening between Hong Kong and mainland China, leveraging talent from the Greater Bay Area to support business expansion - Global economic recovery and full border reopening between Hong Kong and mainland China present development opportunities for the Group[18](index=18&type=chunk)[19](index=19&type=chunk) - Leveraging Greater Bay Area talent to address Hong Kong's human resource market challenges and support core business expansion[19](index=19&type=chunk) [Financial Review](index=12&type=section&id=%E8%B4%A2%E5%8A%A1%E5%9B%9E%E9%A1%BE) H1 2024 revenue grew 14.9% to HKD 3.2654 billion, but profit attributable to owners decreased significantly to HKD 82.4 million due to one-off gains in the prior period, while administrative expenses increased and cash levels remained strong H1 2024 Financial Performance | Metric | H1 2024 (HKD Million) | H1 2023 (HKD Million) | Change Rate | | :------------------- | :------------------ | :------------------ | :---------- | | Revenue | 3,265.4 | 2,841.1 | +14.9% | | Gross Profit | 477.7 | 453.8 | +5.3% | | Gross Profit Margin | 14.6% | 16.0% | -1.4% | | Profit Attributable to Owners | 82.4 | 237.5 | -65.3% | | Adjusted Profit Attributable to Owners | 67.2 | 74.7 | -10.0% | | Administrative Expenses | 360.9 | 318.3 | +13.4% | | Cash and Bank Balances | 1,147.3 | 906.4 (End of 2023) | +26.6% | - Profit attributable to owners was impacted by a one-off net insurance claim income of **HKD 15.2 million** from a US associate and one-off dilution gain of **HKD 124.1 million** and gain on disposal of an associate's interest of **HKD 38.7 million** in the prior period[20](index=20&type=chunk)[26](index=26&type=chunk)[28](index=28&type=chunk) - Share of results of associates increased by **HKD 7.8 million**, mainly due to the US associate turning profitable, partially offset by brand impairment losses[28](index=28&type=chunk) [Liquidity and Financial Resources](index=14&type=section&id=%E6%B5%81%E5%8A%A8%E8%B5%84%E9%87%91%E5%8F%8A%E8%B4%A2%E5%8A%A1%E8%B5%84%E6%BA%90) The Group maintains a robust liquidity position with HKD 1.1473 billion in cash and bank balances, and total bank borrowings of HKD 519.5 million, supported by ample committed bank facilities Liquidity Position | Metric | June 30, 2024 (HKD Million) | Dec 31, 2023 (HKD Million) | Change Rate | | :----------------- | :------------------------ | :----------------------- | :---------- | | Cash and Bank Balances | 1,147.3 | 906.4 | +26.6% | | Total Bank Borrowings | 519.5 | 320.0 | +62.3% | | Committed Bank Facilities | 2,704.7 | 2,673.4 | +1.2% | | Utilized Bank Facilities | 1,251.4 | 949.8 | +31.7% | - Bank borrowings are primarily denominated in HKD and RMB, bear floating interest rates, and are mostly due within five years[29](index=29&type=chunk) [Exchange Rate Risk](index=14&type=section&id=%E6%B1%87%E5%85%91%E9%A3%8E%E9%99%A9) The Group's exchange rate risk is not significant, as it primarily operates in Hong Kong, Macau, mainland China, and the UK, with currency risk closely monitored and hedged - Group's primary business regions are Hong Kong, Macau, mainland China, and the UK, resulting in non-significant exchange rate risk[30](index=30&type=chunk) - Currency risk is closely monitored through exchange rate fluctuation reviews, and foreign currency transactions are hedged with forward exchange contracts[30](index=30&type=chunk) [Use of Proceeds from Share Listing](index=14&type=section&id=%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%82%A1%E4%BB%BD%E4%B8%8A%E5%B8%82%E6%89%80%E5%BE%97%E6%AC%BE%E9%A1%B9%E7%94%A8%E9%80%94) Of the HKD 335.7 million net proceeds from the 2019 global offering, HKD 59.8 million remains unutilized for acquisitions or investments, with full utilization expected by December 31, 2025 Use of Proceeds from Share Listing and Balance | Category of Use | Original Net Proceeds Allocated (HKD Million) | Unutilized Net Proceeds as of Dec 31, 2023 (HKD Million) | Unutilized Net Proceeds as of June 30, 2024 (HKD Million) | | :----------------------- | :---------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Support Building Services Engineering | 67.1 | – | – | | Enhance Environmental Engineering | 100.7 | – | – | | Enhance ICBT Business | 67.1 | – | – | | Expand Lifts and Escalators Business | 67.1 | – | – | | Acquisitions or Investments | – | 59.8 | 59.8 | | General Working Capital | 33.7 | – | – | | **Total** | **335.7** | **59.8** | **59.8** | - Unutilized net proceeds are delayed due to macroeconomic and geopolitical uncertainties, leading management to prudently seek business acquisition and investment opportunities[31](index=31&type=chunk) - Full utilization of net proceeds is expected by December 31, 2025, with no change in the proposed use[31](index=31&type=chunk) [Future Plans for Material Investments or Capital Assets](index=15&type=section&id=%E6%9C%89%E5%85%B3%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B5%84%E6%88%96%E8%B5%84%E6%9C%AC%E8%B3%87%E7%94%A2%E7%9A%84%E6%9C%AA%E6%9D%A5%E8%AE%A1%E5%88%92) As of the report date, the Group has no specific future plans for material investments or capital assets but will continue to actively seek suitable business and investment opportunities - No specific future plans for material investments or capital assets as of the report date[33](index=33&type=chunk) - Group will continue to seek suitable new business and investment opportunities[33](index=33&type=chunk) [Material Acquisitions or Disposals of Subsidiaries, Associates and Joint Ventures](index=16&type=section&id=%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E6%88%96%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E3%80%81%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%90%88%E7%87%9F%E4%BC%81%E6%A5%AD) No material acquisitions or disposals of subsidiaries, associates, or joint ventures occurred during the reporting period - No material acquisition or disposal activities during the reporting period[34](index=34&type=chunk) [Gearing Ratio and Debt](index=16&type=section&id=%E8%B3%87%E7%94%A2%E8%B2%A0%E5%80%B5%E6%AF%94%E7%8E%87%E5%8F%8A%E5%80%B5%E5%8B%99) The Group's gearing ratio increased to 23.9% as of June 30, 2024, from 15.1% at year-end 2023, primarily due to the drawdown of revitalization and short-term green loans Gearing Ratio | Metric | June 30, 2024 | Dec 31, 2023 | | :----------- | :------------ | :----------- | | Gearing Ratio | 23.9% | 15.1% | - Gearing ratio increased mainly due to the drawdown of revitalization loans and short-term green loans[35](index=35&type=chunk) [Pledge of the Group's Assets](index=16&type=section&id=%E6%9C%AC%E9%9B%86%E5%9B%A2%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2024, the Group pledged assets totaling HKD 938.9 million as security for bank financing, mortgage loans, and revitalization loans for ATAL Engineering Tower Total Pledged Assets | Metric | June 30, 2024 (HKD Million) | Dec 31, 2023 (HKD Million) | | :--------------- | :------------------------ | :----------------------- | | Total Pledged Assets | 938.9 | 854.0 | - Pledged assets primarily secure general short-term bank financing, mortgage loans, and revitalization loans for ATAL Engineering Tower[36](index=36&type=chunk) [Capital Commitments](index=16&type=section&id=%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) As of June 30, 2024, the Group's contracted but unprovided capital commitments totaled HKD 26.9 million, mainly for the revitalization of ATAL Engineering Tower and expansion of Nanjing production facilities Capital Commitments | Purpose | June 30, 2024 (HKD Million) | | :------------------------------------ | :------------------------ | | Revitalization of ATAL Engineering Tower and related plant and equipment | 24.6 | | Expansion of Nanjing Production Facilities | 2.3 | | **Total** | **26.9** | [Contingent Liabilities](index=16&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%80%B5) As of June 30, 2024, the Group had outstanding performance guarantees of approximately HKD 596.6 million and has made adequate provisions for potential losses from ongoing litigation Contingent Liabilities | Metric | June 30, 2024 (HKD Million) | Dec 31, 2023 (HKD Million) | | :--------------------- | :------------------------ | :----------------------- | | Outstanding Performance Guarantees | 596.6 | 586.6 | - Group has made adequate provisions for potential losses from pending litigation[38](index=38&type=chunk) [Events After Reporting Period](index=16&type=section&id=%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%90%8E%E4%BA%8B%E9%A1%B9) No material events occurred after the reporting period up to the date of this report - No material events occurred after the reporting period[39](index=39&type=chunk) [Human Resources](index=17&type=section&id=%E4%BA%BA%E5%8A%9B%E8%B5%84%E6%BA%90) As of June 30, 2024, the Group employed 2,725 staff, providing extensive training and fostering talent development, while also enhancing workplace safety through smart systems Human Resources Overview | Metric | June 30, 2024 | June 30, 2023 | | :----------------- | :------------ | :------------ | | Number of Employees | 2,725 | 2,701 | | Internal Training Courses | 252 | - | | Total Training Hours | 21,000+ hours | - | - Cultivated over **1,100 young engineers and technicians** and successfully applied to establish new professional training categories in control, automation, instrumentation, and electronics[40](index=40&type=chunk) - Developed "Smart Site Safety System Working Group" applying AI and IoT technologies to enhance site safety and efficiency, including smart safety harness systems and welding robots[40](index=40&type=chunk) - Received multiple accolades at the "HR Excellence Awards 2023/24," including "Management Trainee Programme Award – Silver," "Learning & Development Award – Bronze," and "Talent Acquisition Award – Bronze"[41](index=41&type=chunk) [Outlook](index=18&type=section&id=%E5%B1%95%E6%9C%9B) The Group is optimistic about its business prospects, driven by a substantial contract backlog, leadership in growth sectors, and strategic investments in advanced technologies and market expansion - Hong Kong's overall construction volume is projected to reach approximately **HKD 300 billion annually by 2031-2032**, with government capital expenditure of about **HKD 90.2 billion in 2024-2025**, presenting significant opportunities[42](index=42&type=chunk) - Investments in advanced technologies like BIM, MiC, MiMEP, robotics solutions, AI, IoT, and big data analytics will enhance productivity, efficiency, safety, and project quality[42](index=42&type=chunk) - Will continue to explore suitable and synergistic business opportunities, including expanding into East Asia, Southeast Asia, the Middle East, and other regions when appropriate[43](index=43&type=chunk) - Strong liquidity, low gearing, and robust recurring cash flow ensure financial flexibility for new projects and long-term strategic planning[43](index=43&type=chunk) [Review Report on Condensed Consolidated Financial Statements](index=19&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8%E5%AE%A1%E9%98%85%E6%8A%A5%E5%91%8A) Deloitte Touche Tohmatsu reviewed the Group's condensed consolidated financial statements for H1 2024, concluding no material non-compliance with HKAS 34 - External auditor Deloitte Touche Tohmatsu reviewed the condensed consolidated financial statements[44](index=44&type=chunk) - Auditor concluded no matters suggesting the condensed consolidated financial statements were not prepared in all material respects in accordance with HKAS 34[45](index=45&type=chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=18&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%8D%9F%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) This statement presents the Group's H1 2024 financial performance, with profit for the period significantly decreasing to HKD 82.28 million from HKD 237.5 million in the prior year Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :------------------- | :--------------------- | :--------------------- | | Revenue | 3,265,383 | 2,841,055 | | Cost of Sales and Services | (2,787,685) | (2,387,255) | | Gross Profit | 477,698 | 453,800 | | Other Income | 12,260 | 11,929 | | Other Gains and Losses | (16,385) | 144,546 | | Administrative Expenses | (360,896) | (318,304) | | Share of Results of Associates | 53 | (7,797) | | Finance Costs | (8,366) | (5,318) | | Profit Before Tax | 105,468 | 267,462 | | Income Tax Expense | (23,188) | (29,942) | | Profit for the Period | 82,280 | 237,520 | - Profit for the period significantly decreased, mainly due to other gains and losses turning from a net gain of **HKD 144.5 million** in the prior period to a net loss of **HKD 16.4 million** in the current period[45](index=45&type=chunk)[67](index=67&type=chunk) [Condensed Consolidated Statement of Financial Position](index=19&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E7%8A%B6%E5%86%B5%E8%A1%A8) This statement outlines the Group's financial position as of June 30, 2024, with total assets less current liabilities at HKD 2.5655 billion and total equity at HKD 2.1804 billion, reflecting increases in property, plant, and equipment Summary of Condensed Consolidated Statement of Financial Position | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :---------------------- | | Non-current Assets | 1,462,913 | 1,417,963 | | Current Assets | 3,882,484 | 3,721,387 | | Current Liabilities | 2,779,927 | 2,730,119 | | Net Current Assets | 1,102,557 | 991,268 | | Total Assets Less Current Liabilities | 2,565,470 | 2,409,231 | | Total Equity | 2,180,400 | 2,129,162 | | Non-current Liabilities | 385,070 | 280,069 | - Property, plant and equipment increased from **HKD 851.1 million to HKD 925.5 million**, mainly related to the revitalization of ATAL Engineering Tower[46](index=46&type=chunk)[85](index=85&type=chunk) - Bank borrowings (non-current liabilities) increased from **HKD 248.8 million to HKD 347.9 million**, reflecting the drawdown of revitalization loans[47](index=47&type=chunk)[21](index=21&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=21&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%9D%83%E7%9B%8A%E5%8F%98%E5%8A%A8%E8%A1%A8) This statement details changes in equity components for H1 2024, with total comprehensive income for the period at HKD 62.581 million and profit attributable to owners at HKD 82.409 million Summary of Condensed Consolidated Statement of Changes in Equity | Metric | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :--------------------- | | Profit for the Period | 82,280 | 237,520 | | Other Comprehensive Expense for the Period (net of tax) | (19,699) | (22,857) | | Total Comprehensive Income for the Period | 62,581 | 214,663 | | Profit Attributable to Owners of the Company for the Period | 82,409 | 237,520 | | Total Comprehensive Income Attributable to Owners of the Company | 62,734 | 214,663 | - Total comprehensive income for the period was **HKD 62.581 million**, a significant decrease from **HKD 214.7 million** in the prior period[48](index=48&type=chunk) - Other comprehensive expenses primarily included a property revaluation loss of **HKD 2.217 million** and exchange differences on translation of overseas operations of **HKD 17.749 million**[45](index=45&type=chunk)[48](index=48&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=22&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) This statement presents the Group's H1 2024 cash flows, with net cash from operating activities significantly improving to HKD 206.1 million, while investment activities resulted in a net outflow of HKD 112.2 million Summary of Condensed Consolidated Statement of Cash Flows | Metric | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :--------------------- | | Net Cash From/(Used In) Operating Activities | 206,130 | (76,308) | | Net Cash (Used In)/From Investing Activities | (112,200) | 38,398 | | Net Cash From/(Used In) Financing Activities | 155,900 | (97,044) | | Net Increase/(Decrease) in Cash and Cash Equivalents | 249,830 | (134,954) | | Cash and Cash Equivalents at End of Period | 1,147,345 | 835,139 | - Operating cash flow improved from a net outflow to a net inflow, reflecting enhanced operational efficiency[50](index=50&type=chunk) - Net cash outflow from investing activities increased, primarily due to additions to property, plant and equipment of **HKD 105.1 million**, largely related to ATAL Engineering Tower revitalization[50](index=50&type=chunk)[85](index=85&type=chunk) - Net cash inflow from financing activities was **HKD 155.9 million**, mainly from new bank borrowings of **HKD 238.7 million**[51](index=51&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=24&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8%E9%99%84%E6%B3%A8) This section provides detailed notes to the condensed consolidated financial statements, offering in-depth information on accounting policies, revenue, expenses, balance sheet items, equity, financial instruments, and related party transactions [Basis of Preparation](index=26&type=section&id=%E7%BC%96%E8%A3%BD%E5%9F%BA%E5%87%86) The condensed consolidated financial statements are prepared in accordance with HKAS 34 and the Listing Rules, measured on a historical cost basis with certain exceptions - Financial statements are prepared in accordance with HKAS 34 and the Listing Rules[55](index=55&type=chunk) - Historical cost basis is applied, with certain properties and financial instruments measured at revalued amounts or fair value[55](index=55&type=chunk) [Principal Accounting Policies](index=26&type=section&id=%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96) Accounting policies and calculation methods for this interim period are consistent with the annual consolidated financial statements for the year ended December 31, 2023 - Accounting policies applied in this interim period are consistent with the 2023 annual consolidated financial statements[55](index=55&type=chunk) - Initial application of revised HKFRSs had no material impact on the financial position and performance for the current and prior periods[55](index=55&type=chunk) [Revenue and Segment Information](index=27&type=section&id=%E6%94%B6%E7%9B%8A%E5%8F%8A%E6%9D%BF%E5%9D%97%E8%B5%84%E6%96%99) Group revenue primarily derives from contract works, maintenance, and goods sales, totaling HKD 3.2654 billion in H1 2024, with Hong Kong as the main source and Building Services Engineering as the largest segment Revenue Sources and Geographical Distribution | Revenue Category | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :--------------- | :--------------------- | :--------------------- | | Contract Works | 2,585,340 | 2,219,660 | | Maintenance Works | 614,741 | 565,122 | | Sales of Goods | 65,302 | 56,273 | | **Total Revenue** | **3,265,383** | **2,841,055** | | **Geographical Distribution** | | | | Hong Kong | 2,795,938 | 2,459,875 | | Macau | 291,946 | 221,971 | | Mainland China | 110,284 | 152,024 | | United Kingdom | 63,657 | 5,303 | | United States | 37 | 18 | | Others | 3,521 | 1,864 | Revenue by Business Segment | Business Segment | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :--------------------- | | Building Services Engineering | 2,111,348 | 1,747,968 | | Environmental Engineering | 620,588 | 622,524 | | ICBT | 294,570 | 310,918 | | Lifts and Escalators | 238,877 | 159,645 | - Total transaction price allocated to remaining performance obligations amounted to **HKD 11.7043 billion** as of June 30, 2024[60](index=60&type=chunk) [Other Income and Gains/(Losses)](index=32&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E5%8F%8A%E4%BA%8F%E6%8D%9F) In H1 2024, the Group recorded a net loss of HKD 16.4 million from other income and gains/(losses), a significant shift from a net gain of HKD 144.5 million in the prior period due to one-off gains in 2023 Composition of Other Income and Gains/(Losses) | Item | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :--------------------------------- | :--------------------- | :--------------------- | | Gain on disposal of interest in an associate | – | 38,725 | | Impairment loss on interest in an associate | (12,645) | (19,000) | | Deemed gain on dilution of interest in an associate | – | 124,125 | | Net exchange losses | (3,457) | (2,177) | | Fair value change loss on investment properties | (220) | – | | **Total** | **(16,385)** | **144,546** | - No one-off gains from private placement by an associate and disposal of interest in the prior period were recognized in the current period[26](index=26&type=chunk)[67](index=67&type=chunk) [Finance Costs](index=32&type=section&id=%E8%B4%A2%E5%8A%A1%E6%88%90%E6%9C%AC) Finance costs increased by 57.3% to HKD 8.366 million in H1 2024, primarily driven by higher interest expenses on bank borrowings Composition of Finance Costs | Item | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :--------------- | :--------------------- | :--------------------- | | Interest expense on bank borrowings | 5,998 | 2,251 | | Interest on lease liabilities | 1,063 | 1,712 | | Ancillary costs for bank financing | 1,305 | 1,355 | | **Total** | **8,366** | **5,318** | - Interest expense on bank borrowings increased from **HKD 2.251 million to HKD 5.998 million**, being the primary driver of finance cost growth[69](index=69&type=chunk) [Income Tax Expense](index=33&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income tax expense decreased to HKD 23.188 million in H1 2024, with Hong Kong profits tax calculated under a two-tiered system and varying rates for Macau and mainland China Composition of Income Tax Expense | Item | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :--------------- | :--------------------- | :--------------------- | | Current tax | 23,601 | 32,023 | | Underprovision in prior years | (100) | 46 | | Deferred tax | (313) | (2,127) | | **Total** | **23,188** | **29,942** | - Hong Kong profits tax applies a two-tiered system, with the first **HKD 2 million** of assessable profits taxed at **8.25%** and the remainder at **16.5%**[70](index=70&type=chunk) - Mainland China subsidiaries are subject to a **25% corporate income tax rate**, with high-tech enterprises enjoying a **15% preferential tax rate until 2024**[71](index=71&type=chunk) [Profit for the Period](index=34&type=section&id=%E6%9C%9F%E5%85%A7%E6%BA%A2%E5%88%A9) Profit for the period is derived after deducting various expenses, with staff costs totaling HKD 738.3 million in H1 2024, representing a 12.4% increase year-on-year Deductions from Profit for the Period | Item | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :--------------------- | | Staff costs | 738,321 | 656,723 | | Cost of inventories recognized as expense | 140,083 | 129,517 | | Amortization of intangible assets | 301 | – | | Depreciation of property, plant and equipment | 10,760 | 12,042 | | Depreciation of right-of-use assets | 22,776 | 19,611 | | Write-down of inventories, net | 3,378 | 3,774 | | Fair value change loss on derivative financial instruments | 2,547 | (1,155) | | Auditor's remuneration | 3,043 | 2,755 | - Staff costs (including directors' emoluments) increased by **12.4%** from **HKD 656.7 million to HKD 738.3 million**[76](index=76&type=chunk) [Dividends](index=35&type=section&id=%E8%82%A1%E6%81%AF) The Board declared an interim dividend of HKD 2.38 cents per share, totaling approximately HKD 32.993 million, payable around September 27, 2024 - Board declared an interim dividend of **HKD 2.38 cents per share**, totaling approximately **HKD 32.993 million**[80](index=80&type=chunk) - Interim dividend will be paid on or about September 27, 2024, with shares trading ex-dividend from September 11, 2024[80](index=80&type=chunk)[121](index=121&type=chunk) [Earnings Per Share](index=35&type=section&id=%E6%AF%8F%E8%82%A1%E7%9B%88%E5%88%A9) Basic and diluted earnings per share for H1 2024 were both HKD 6 cents, lower than HKD 17 cents in the prior period, with weighted average ordinary shares adjusted for the share award scheme Earnings Per Share | Metric | H1 2024 (HK Cents) | H1 2023 (HK Cents) | | :----------- | :----------------- | :----------------- | | Basic EPS | 6 | 17 | | Diluted EPS | 6 | 17 | Weighted Average Number of Ordinary Shares | Metric | H1 2024 | H1 2023 | | :----------------------- | :------------ | :------------ | | Weighted average number of ordinary shares for basic EPS | 1,386,528,000 | 1,395,438,000 | | Weighted average number of ordinary shares for diluted EPS | 1,399,148,220 | 1,395,438,000 | - For diluted EPS calculation, the effect of certain company award shares was assumed, with no other dilutive potential ordinary shares[81](index=81&type=chunk) [Investment Properties](index=36&type=section&id=%E6%8A%95%E8%B5%84%E7%89%A9%E4%B8%9A) As of June 30, 2024, investment properties had a fair value of HKD 4.26 million, a decrease from HKD 4.48 million due to fair value change losses, and are pledged as security for bank financing Fair Value of Investment Properties | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :--------------- | :--------------------- | :---------------------- | | Fair Value | 4,260 | 4,480 | | Fair Value Change | (220) | (240) | - Fair value of investment properties was assessed by independent professional valuer JLL Limited using the direct comparison method[82](index=82&type=chunk) - Investment properties are pledged as security for general bank financing of certain subsidiaries of the Company[83](index=83&type=chunk) [Property, Plant and Equipment and Right-of-Use Assets](index=37&type=section&id=%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99%E4%BB%A5%E5%8F%8A%E4%BD%BF%E7%94%A8%E6%AC%8A%E8%B3%87%E7%94%A2) In H1 2024, the Group invested HKD 87.997 million in property, plant, and equipment, primarily for the revitalization of ATAL Engineering Tower, and recognized HKD 13.826 million in new right-of-use assets - Additions to property, plant and equipment amounted to **HKD 87.997 million**, with **HKD 78.849 million** related to the revitalization of ATAL Engineering Tower[85](index=85&type=chunk) - Bank interest expenses of **HKD 1.431 million** for ATAL Engineering Tower were capitalized as construction in progress[85](index=85&type=chunk) - New lease agreements resulted in the recognition of right-of-use assets of approximately **HKD 13.826 million**[85](index=85&type=chunk) [Interests in Associates / Amounts Due from an Associate](index=37&type=section&id=%E6%96%BC%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E7%9A%84%E6%AC%8A%E7%9B%8A%E2%81%84%E6%87%89%E6%94%B6%E4%B8%80%E9%96%93%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E6%AC%BE%E9%A0%85) As of June 30, 2024, interests in associates totaled HKD 457.9 million, with impairment losses recognized for TEI due to unfavorable US market conditions, and HKD 118.4 million due from OBJV Interests in Associates | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :------------------- | :--------------------- | :---------------------- | | Cost of Investment | 332,657 | 332,657 | | Impairment Losses Recognized | (137,245) | (124,600) | | Share of Post-Acquisition Profit and Other Comprehensive Income | 262,473 | 275,999 | | **Interests in Associates** | **457,885** | **484,056** | - Impairment assessment of TEI's interest resulted in a goodwill impairment loss of **HKD 12.645 million** and a post-tax brand impairment loss of **HKD 18.921 million**, primarily due to lower-than-expected financial performance from unfavorable US market conditions[88](index=88&type=chunk) - Amount due from OBJV was **HKD 118.4 million**, which is interest-free, non-trade in nature, unsecured, and repayable on demand[88](index=88&type=chunk) [Contract Assets](index=39&type=section&id=%E5%90%88%E7%BA%A6%E8%B3%87%E7%94%A2) As of June 30, 2024, net contract assets were HKD 1.2944 billion, a decrease from HKD 1.3467 billion, including HKD 511.7 million in retention receivables, with expected credit loss provisions made Contract Assets | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :----------------- | :--------------------- | :---------------------- | | Contract Assets | 1,316,657 | 1,368,359 | | Less: Provision for Credit Losses | (22,221) | (21,646) | | **Net** | **1,294,436** | **1,346,713** | - Contract assets include approximately **HKD 511.7 million** in retention receivables, typically settled after the warranty period expires[91](index=91&type=chunk) - Provisions for expected credit losses have been made in accordance with HKFRS 9[91](index=91&type=chunk) [Trade Receivables](index=39&type=section&id=%E8%B4%B8%E6%98%93%E5%BA%94%E6%94%B6%E6%AC%BE%E9%A1%B9) As of June 30, 2024, net trade receivables were HKD 1.1753 billion, stable compared to year-end 2023, including HKD 161.9 million in unbilled revenue, with credit periods of 14 to 90 days Trade Receivables | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :------------------- | :--------------------- | :---------------------- | | Trade Receivables | 1,074,481 | 1,068,590 | | Less: Provision for Credit Losses | (62,405) | (65,504) | | Unbilled Revenue | 161,930 | 173,732 | | Bills Receivable | 1,264 | 1,400 | | **Total** | **1,175,270** | **1,178,218** | Ageing Analysis of Trade Receivables (Net of Credit Loss Provision) | Ageing | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :------------- | :--------------------- | :---------------------- | | 0 to 30 days | 610,367 | 533,985 | | 31 to 90 days | 236,227 | 355,195 | | 91 to 360 days | 163,909 | 113,249 | | Over 1 year | 1,573 | 657 | | **Total** | **1,012,076** | **1,003,086** | - Provisions for expected credit losses have been made in accordance with HKFRS 9, with impairment provisions of **HKD 17.273 million** recognized and **HKD 12.16 million** reversed in the current period[95](index=95&type=chunk) [Trade Payables and Retention Payables](index=41&type=section&id=%E8%B4%B8%E6%98%93%E5%BA%94%E4%BB%98%E6%AC%BE%E9%A1%B9%E5%8F%8A%E5%BA%94%E4%BB%98%E4%BF%9D%E8%AF%81%E9%87%91) As of June 30, 2024, total trade payables and retention payables decreased to HKD 644.2 million from HKD 775.6 million at year-end 2023, with trade payables having credit periods of 0 to 90 days Trade Payables and Retention Payables | Item | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :--------------- | :--------------------- | :---------------------- | | Trade Payables | 415,923 | 537,801 | | Trade Payables (Unbilled) | 41,124 | 52,099 | | Retention Payables | 187,190 | 185,741 | | **Total** | **644,237** | **775,641** | Ageing Analysis of Trade Payables | Ageing | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :------------- | :--------------------- | :---------------------- | | 0 to 30 days | 206,480 | 273,155 | | 31 to 90 days | 142,290 | 202,301 | | 91 to 360 days | 41,137 | 39,037 | | Over 1 year | 26,016 | 23,308 | | **Total** | **415,923** | **537,801** | [Other Payables and Accruals](index=41&type=section&id=%E5%85%B6%E4%BB%96%E5%BA%94%E4%BB%98%E6%AC%BE%E9%A1%B9%E5%8F%8A%E5%BA%94%E8%AE%A1%E5%BC%80%E6%94%AF) As of June 30, 2024, other payables and accruals increased to HKD 1.826 billion, primarily comprising accrued contract costs of HKD 1.4693 billion and accrued staff costs of HKD 143 million, with litigation provision maintained Other Payables and Accruals | Item | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :--------------- | :--------------------- | :---------------------- | | Accrued Contract Costs | 1,469,251 | 1,379,053 | | Accrued Staff Costs | 143,029 | 129,708 | | Provision for Litigation Liabilities | 150,000 | 150,000 | | Liabilities for Additional Interest in an Associate | 3,204 | – | | Others | 60,514 | 84,813 | | **Total** | **1,825,998** | **1,743,574** | - Provision for litigation liabilities remained at **HKD 150 million**, related to a cooperation agreement with the Hong Kong Competition Commission in November 2022[98](index=98&type=chunk) [Bank Borrowings](index=42&type=section&id=%E9%93%B6%E8%A1%8C%E5%80%9F%E6%AC%BE) As of June 30, 2024, total bank borrowings significantly increased to HKD 519.5 million, with HKD 171.6 million due within one year and HKD 347.9 million due after one year, secured by various assets Composition of Bank Borrowings | Item | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :--------------- | :--------------------- | :---------------------- | | Secured floating-rate bank loans | 266,638 | 274,271 | | Secured fixed-rate bank loans | 100,000 | – | | Unsecured floating-rate bank loans | 152,761 | 45,535 | | Unsecured fixed-rate bank loans | 105 | 240 | | **Total** | **519,504** | **320,046** | | Due within one year | (171,638) | (71,280) | | Due after one year | 347,866 | 248,766 | - Bank borrowings bear effective interest rates ranging from **2.50% to 6.58%**[101](index=101&type=chunk) - Secured bank borrowings are pledged against ATAL Engineering Tower, Nanjing properties, rental income, and assets of certain wholly-owned subsidiaries and trade receivables[101](index=101&type=chunk) [Share Capital](index=43&type=section&id=%E8%82%A1%E6%9C%AC) As of June 30, 2024, the Company's authorized share capital was 100 billion ordinary shares of HKD 0.01 each, with 1.4 billion issued and fully paid shares, totaling HKD 14 million Share Capital Overview | Metric | Number of Shares | Par Value | Share Capital (HKD Thousand) | | :------------- | :-------------------- | :-------- | :--------------------------- | | Authorized Share Capital | 100,000,000,000 | HKD 0.01 | 1,000,000 | | Issued and Fully Paid Share Capital | 1,400,000,000 | HKD 0.01 | 14,000 | - In April 2024, the Company repurchased **430,000 of its own ordinary shares** for a total consideration of **HKD 451,000**[102](index=102&type=chunk) - As of June 30, 2024, the trustee held **13.72 million of the Company's own ordinary shares**[104](index=104&type=chunk) [Share-based Payments](index=43&type=section&id=%E4%BB%A5%E8%82%A1%E4%BB%BD%E4%B8%BA%E5%9F%BA%E7%A1%80%E7%9A%84%E4%BB%98%E6%AC%BE) The Group's share award scheme aims to reward participants, with 12.56 million unvested award shares whose vesting date has been postponed to December 23, 2024, and no options granted under the share option scheme Unvested Award Shares under Share Award Scheme | Grantee/Category | Unvested Awards as of Jan 1, 2024 | Forfeited/Lapsed during the Period | Unvested Awards as of June 30, 2024 | | :--------------- | :-------------------------------- | :--------------------------------- | :---------------------------------- | | Directors | 5,920,000 | – | 5,920,000 | | Employees | 7,240,000 | (600,000) | 6,640,000 | | **Total** | **13,160,000** | **(600,000)** | **12,560,000** | - **12.56 million award shares** remain unvested, with their vesting date postponed from June 30, 2024, to December 23, 2024[107](index=107&type=chunk)[137](index=137&type=chunk) - No share options have been granted under the share option scheme since its effective date of July 12, 2019, with no outstanding options at period-end[109](index=109&type=chunk)[137](index=137&type=chunk) [Pledge of Assets](index=45&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of the reporting period end, the Group had pledged assets totaling HKD 943.558 million as security for bank borrowings and general bank financing, including properties, investment properties, and bank deposits Pledged Assets | Item | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :--------------- | :--------------------- | :---------------------- | | Properties | 872,414 | 791,345 | | Investment Properties | 4,260 | 4,480 | | Bank Deposits | 26,260 | 22,698 | | Others | 40,624 | 35,476 | | **Total** | **943,558** | **853,999** | - Other pledged assets include certain trade receivables and fixed and floating charges over all assets of certain wholly-owned subsidiaries[110](index=110&type=chunk) [Fair Value Measurement of Financial Instruments](index=46&type=section&id=%E9%87%91%E8%9E%8D%E5%B7%A5%E5%85%B7%E7%9A%84%E5%85%AC%E5%85%81%E4%BB%B7%E5%80%BC%E8%AE%A1%E9%87%8F) The Group's derivative financial instruments are measured at fair value on a recurring basis, classified as Level 2, with fair values estimated using discounted cash flow models Fair Value of Derivative Financial Instruments | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :---------------------- | | Derivative Financial (Liabilities)/Assets | (1,079) | 1,468 | - Fair value measurement of derivative financial instruments uses discounted cash flow valuation techniques and is classified as Level 2[111](index=111&type=chunk) - Carrying amounts of other financial assets and liabilities recorded at amortized cost approximate their fair values[113](index=113&type=chunk) [Performance Guarantees](index=46&type=section&id=%E5%B1%A5%E7%BA%A6%E4%BF%9D%E8%AF%81) As of June 30, 2024, the Group had outstanding performance guarantees of approximately HKD 596.6 million, issued by banks to customers as security for contract obligations Outstanding Performance Guarantees | Metric | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :----------------------- | :--------------------- | :-------------------- | | Outstanding Performance Guarantees | 596,639 | 586,620 | - Performance guarantees are issued by banks to customers as security for the Group's due performance of contractual obligations[114](index=114&type=chunk) [Related Party Transactions](index=47&type=section&id=%E5%85%B3%E8%BF%9E%E6%96%B9%E4%BA%A4%E6%98%93) The Group engaged in various related party transactions, including sales with associates OBJV and TEI, and lease liability repayments and expense recharges with Perfect Motive Summary of Related Party Transactions | Related Company Name | Relationship | Nature of Transaction | H1 2024 (HKD Thousand) | H1 2023 (HKD Thousand) | | :------------------- | :----------- | :-------------------- | :--------------------- | :--------------------- | | OBJV | Associate | Sales | 3,409 | 1,604 | | Perfect Motive | Related Party | Repayment of Lease Liabilities | 7,956 | 7,956 | | Perfect Motive | Related Party | Recharge of Direct Expenses | 273 | 280 | | TEI | Associate | Sales | 37 | 40 | - Lease liabilities related to Perfect Motive amounted to **HKD 5.222 million** as of June 30, 2024[117](index=117&type=chunk) - Emoluments of key management personnel (directors) are disclosed in Note 7 (Profit for the Period)[118](index=118&type=chunk) [Capital Commitments](index=47&type=section&id=%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) As of the reporting period end, the Group's contracted but unprovided capital commitments totaled HKD 26.896 million, primarily for the revitalization of ATAL Engineering Tower and expansion of Nanjing production facilities Composition of Capital Commitments | Purpose | June 30, 2024 (HKD Thousand) | Dec 31, 2023 (HKD Thousand) | | :------------------------------------ | :--------------------- | :---------------------- | | Expansion of Existing Production Facilities | 2,334 | 4,470 | | Revitalization of ATAL Engineering Tower | 17,807 | 92,044 | | Plant and Equipment for ATAL Engineering Tower | 6,755 | – | | **Total** | **26,896** | **96,514** | [Interim Dividend](index=48&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board declared an interim dividend of HKD 2.38 cents per share, totaling approximately HKD 32.993 million, with shares trading ex-dividend from September 11, 2024 - Board declared an interim dividend of **HKD 2.38 cents per share**, totaling approximately **HKD 32.993 million**[120](index=120&type=chunk) - Share register will be closed from September 13 to September 16, 2024, to determine dividend entitlement, with shares trading ex-dividend from September 11, 2024[121](index=121&type=chunk) [Other Information](index=49&type=section&id=%E5%85%B6%E4%BB%96%E8%B5%84%E6%96%99) This section covers the Group's international sanctions compliance, interim results review, corporate governance, directors' securities transactions, director updates, and share interests [International Sanctions](index=49&type=section&id=%E5%9B%BD%E9%99%85%E5%88%B6%E8%A3%81) The Group conducted no transactions with sanctioned individuals or entities during the reporting period and maintains measures to ensure compliance and monitor sanction risks - No transactions with individuals or entities subject to international sanctions during the reporting period[123](index=123&type=chunk) - Risk Management Committee (Sanctions Risk) meets at least twice annually to monitor sanction risks and establish written procedures[123](index=123&type=chunk) [Review of Interim Results](index=49&type=section&id=%E5%AE%A1%E9%98%85%E4%B8%AD%E6%9C%9F%E4%B8%9A%E7%BB%A9) The Company's Audit Committee reviewed the unaudited condensed consolidated interim financial statements for H1 2024 with management and external auditor Deloitte Touche Tohmatsu - Audit Committee reviewed the interim financial statements and discussed financial matters with management and external auditor[124](index=124&type=chunk) - External auditor Deloitte Touche Tohmatsu reviewed the financial statements in accordance with Hong Kong Standard on Review Engagements 2410[124](index=124&type=chunk) [Compliance with Corporate Governance Code](index=50&type=section&id=%E9%81%B5%E5%AE%88%E4%BC%81%E4%B8%9A%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%88%99) The Company is committed to high corporate governance standards and complied with all code provisions of the Corporate Governance Code during the reporting period - Company adopted the principles and code provisions of the Corporate Governance Code set out in Appendix C1 to the Listing Rules[125](index=125&type=chunk) - Company complied with all code provisions of the Corporate Governance Code during the reporting period[125](index=125&type=chunk) [Directors' Securities Transactions](index=50&type=section&id=%E8%91%A3%E4%BA%8B%E8%BF%9B%E8%A1%8C%E8%AF%81%E5%88%B8%E4%BA%A4%E6%98%93) All directors confirmed compliance with the Securities Dealing Code, except for Dr. Poon Lok To, who inadvertently sold 2,332,000 shares without prior dealing confirmation - Company's Securities Dealing Code is no less exacting than the Model Code[126](index=126&type=chunk) - Dr. Poon Lok To, Founder and Executive Director, inadvertently sold **2,332,000 shares** without prior dealing confirmation, constituting a breach of the Securities Dealing Code[126](index=126&type=chunk) - Dr. Poon has provided a written undertaking to comply with all requirements in the future[126](index=126&type=chunk) [Update on Directors' Information](index=50&type=section&id=%E8%91%A3%E4%BA%8B%E8%B5%84%E6%96%99%E6%9B%B4%E6%96%B0) Mr. Lam Kin Fung was appointed as an independent non-executive director of Goldin Financial Holdings Limited, and the monthly salaries of Mr. Chan Hoi Ming, Mr. Cheng Wai Lun, and Mr. Cheng Wai Keung increased from April 1, 2024 - Mr. Lam Kin Fung was appointed as an independent non-executive director of Goldin Financial Holdings Limited[127](index=127&type=chunk) Directors' Remuneration Adjustment | Director Name | New Monthly Remuneration (HKD) | Effective Date | | :----------------- | :----------------------------- | :---------------- | | Mr. Chan Hoi Ming | 215,250 | April 1, 2024 | | Mr. Cheng Wai Lun | 174,900 | April 1, 2024 | | Mr. Cheng Wai Keung | 195,000 | April 1, 2024 | [Directors' Interests in Securities](index=51&type=section&id=%E8%91%A3%E4%BA%8B%E4%BA%8E%E8%AF%81%E5%88%B8%E7%9A%84%E6%9D%83%E7%9B%8A) As of June 30, 2024, Dr. Poon Lok To held approximately 65.77% of the Company's shares through a discretionary trust and beneficial ownership, with other directors also holding shares and related interests Directors' Interests in the Company's Shares | Director Name | Capacity/Nature of Interest | Number of Shares Held | Number of Related Shares Held | Approximate Percentage of Shareholding | | :----------------- | :------------------------ | :-------------------- | :---------------------------- | :------------------------------------- | | Dr. Poon | Founder of Discretionary Trust | 888,650,000 | – | 63.48% | | Dr. Poon | Beneficial Owner | 32,198,000 | – | 2.29% | | Mr. Chan Hoi Ming | Beneficial Owner | 4,200,000 | 5,600,000 | 0.30% / 0.40% | | Mr. Cheng Wai Lun | Beneficial Owner | 244,500 | 320,000 | 0.02% / 0.02% | - Dr. Poon holds **63.48%** of the Company's shares through Arling Investment Limited and **2.29%** as a beneficial owner[130](index=130&type=chunk) - Related shares held by Mr. Chan Hoi Ming and Mr. Cheng Wai Lun are unvested award shares granted under the Share Award Scheme[130](index=130&type=chunk) [Substantial Shareholders / Other Persons' Interests in Securities](index=53&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E4%B8%9C%E2%81%84%E5%85%B6%E4%BB%96%E4%BA%BA%E5%A3%AB%E4%BA%8E%E8%AF%81%E5%88%B8%E7%9A%84%E6%9D%83%E7%9B%8A) As of June 30, 2024, substantial shareholders include HSBC International Trustee Limited, Ardik Investment Limited, and Arling Investment Limited, each holding approximately 63.48% of the Company's shares, with Ms. Teresa Cheng and Mr. David Michael Webb also holding significant interests Substantial Shareholders' Interests in Shares | Name/Company | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Shareholding | | :------------------------- | :------------------------ | :-------------------- | :------------------------------------- | | HSBC International Trustee Limited | Founder of Discretionary Trust | 888,650,000 | 63.48% | | Ardik Investment Limited | Interest of Controlled Corporation | 888,650,000 | 63.48% | | Arling Investment Limited | Beneficial Owner | 888,650,000 | 63.48% | | Ms. Teresa Cheng | Spouse's Interest | 920,848,000 | 65.77% | Other Persons' Interests in Shares | Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Shareholding | | :----------------------- | :------------------------ | :-------------------- | :------------------------------------- | | Mr. Webb David Michael | Interest of Controlled Corporation | 112,084,000 | 8.00% | - Ms. Teresa Cheng is deemed to be interested in the Company's shares under the SFO due to her spouse, Dr. Poon's, interests[135](index=135&type=chunk) [Share Option Scheme and Share Award Scheme](index=54&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83%E5%8F%8A%E8%82%A1%E4%BB%BD%E7%8D%8E%E5%8B%B5%E8%A8%88%E5%8A%83) The share option scheme has not granted any options since its inception, while the share award scheme saw 600,000 awards lapse and the vesting date for 12.56 million awards postponed to December

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的內容概不負責，對其準確性 或完整性亦不發表任何聲明，並明確表示，概不會對因本公告全部或任何部分內容而產生或因 倚賴該等內容而引致的任何損失承擔任何責任。 Analogue Holdings Limited 安樂工程集團有限公司 截至2024年6月30日止六個月 中期業績 | --- | --- | --- | |------------------------------------------------------|-------------------------------|------------------| | 財務概要 | 截至 6 月 30 | 日止六個月 | | | 2024 年 百萬港元 | 2023 年 百萬港元 | | | | | | 收益 | 3,265.4 | 2,841.1 | | 毛利 | 477.7 | 453.8 | | 本公司擁有人應佔溢利 | 82.4 | 237.5 | | 每股基本盈利 | 0.06 港元 | 0.17 港元 | | 董事會已決議派付截至 2024 年 6 月 30 | 日止六個月的中期股息 ...

Financial Performance - For the fiscal year ending December 31, 2023, the company achieved a profit attributable to shareholders of HKD 251.5 million, representing a year-on-year increase of 119.5% from HKD 114.6 million in the fiscal year 2022[2]. - The total revenue for the fiscal year 2023 was HKD 6.133 billion, a slight decrease from HKD 6.475 billion in the fiscal year 2022[13]. - Gross profit for 2023 was HKD 833.3 million, down 17.7% from HKD 1,011.5 million in the previous year[86]. - Basic earnings per share rose to HKD 0.18, up from HKD 0.08 in 2022, marking a 125% increase[86]. - The adjusted profit attributable to the company's owners for the fiscal year 2023 is HKD 249.4 million, excluding one-time impacts from healthcare contract provisions[135]. - The group reported a net profit of HKD 128.4 million for the fiscal year 2023, compared to a net loss of HKD 33.3 million in the fiscal year 2022[187]. Revenue and Contracts - The company secured new contracts worth HKD 4.113 billion in the fiscal year 2023, compared to HKD 4.803 billion in the fiscal year 2022[4]. - The company has a backlog of contracts valued at HKD 6.1 billion, indicating strong future revenue potential[100]. - The company secured new maintenance contracts valued at HKD 600 million in 2023, compared to HKD 415 million in the fiscal year 2022, enhancing recurring revenue sources[137]. - Revenue from the building services engineering segment for the fiscal year 2023 was HKD 3.736 billion, a decrease from HKD 4.257 billion in 2022[150]. - The environmental engineering segment generated revenue of HKD 1.356 billion in 2023, up from HKD 1.234 billion in 2022, reflecting a growth of approximately 9.9%[153]. Strategic Initiatives and Acquisitions - The company completed the acquisition of two UK-based elevator companies, marking a strategic milestone in its global market expansion strategy[3]. - The group has successfully acquired two companies in the UK, with JCW becoming a majority-controlled subsidiary and Precision a wholly-owned subsidiary[194]. - The company launched an innovative water and wastewater treatment solution called "AlgoWater," utilizing digital twin technology[110]. - The company is focused on expanding its market presence and enhancing its engineering capabilities through strategic appointments and leadership transitions[56]. Innovation and Technology - The company is focused on developing innovative solutions, including AI-driven technologies and energy optimization, to maintain its market leadership[10]. - The company has developed multiple technological applications in environmental engineering and information technology, reinforcing its market leadership[134]. - The company has successfully implemented advanced technologies in over 50% of its building services engineering projects, enhancing efficiency, quality, and safety[160]. Corporate Governance and Leadership - The company has adopted the principles and code provisions of the Corporate Governance Code as a benchmark for its corporate governance practices[66]. - The company has complied with all applicable code provisions of the Corporate Governance Code during the reporting year[67]. - The company appointed Mrs. Yvonne Law as an independent non-executive director effective immediately after the annual general meeting on June 27, 2023[60]. - Leadership changes include Dr. Mak being appointed as Executive Director and Chairman of the Board effective March 1, 2024[80]. Sustainability and Social Responsibility - The company is focusing on sustainable development and aims to operate in an environmentally and socially responsible manner[85]. - The company received multiple awards for its contributions to green building and sustainable practices, including the Platinum Award for outstanding ESG achievements[34]. - The company aims to enhance its global business footprint by introducing professional services to more markets, focusing on sustainable development[134]. Financial Position and Ratios - The company's asset-to-equity ratio increased to 15.1% as of December 31, 2023, compared to 13.5% as of December 31, 2022[21]. - The current ratio decreased to 1.4 times in 2023 from 1.5 times in 2022, indicating a slight decline in liquidity[36]. - The asset-liability ratio increased to 15.1% in 2023 from 13.5% in 2022, indicating a rise in financial leverage[36]. - The group maintained a strong cash level with bank balances and cash amounting to HKD 906.4 million as of December 31, 2023[184]. Employee Engagement and Culture - The company is actively enhancing employee engagement through initiatives like the ARWA Club, promoting a healthy work environment[24]. - The group aims to promote a diverse workplace culture by signing the "Racial Diversity and Inclusion Employer Charter"[108].

Financial Performance - The company reported an adjusted profit attributable to shareholders of HKD 249,400,000 for the fiscal year 2023, excluding certain provisions and impacts[17]. - The group reported a net profit attributable to shareholders of HKD 2.514 billion for the fiscal year 2023, adjusted for certain provisions, resulting in an adjusted profit of HKD 249.4 million[42]. - The total revenue for 2023 was HKD 6,132,944, a decrease of 5.3% from HKD 6,474,650 in 2022[68]. - The gross profit for the fiscal year was HKD 833.3 million, down from HKD 1,011.5 million in the previous year, reflecting a decline of 17.6%[94]. - Profit attributable to owners for the year was HKD 251.5 million, an increase of 119.8% compared to HKD 114.6 million in 2022[94]. - Basic earnings per share for 2023 was HKD 0.18, compared to HKD 0.08 in 2022, representing a 125% increase[94]. - The group reported revenue of HKD 6,132,944 thousand for the year 2023, a decrease of 5.3% from HKD 6,474,650 thousand in 2022[129]. Revenue Breakdown - The ICBT business generated revenue of HKD 663,000,000 in the fiscal year 2023, an increase from HKD 631,000,000 in 2022, with new contract awards totaling HKD 618,000,000[12]. - Environmental engineering business revenue reached HKD 1,356,000,000 in fiscal year 2023, up from HKD 1,234,000,000 in 2022[21]. - The group's revenue from the elevator and escalator business reached HKD 378 million in the fiscal year 2023, an increase from HKD 353 million in fiscal year 2022[24]. - Revenue from long-term contracts in construction and maintenance was HKD 4,926,890 thousand in 2023, down from HKD 5,394,415 thousand in 2022, representing a decline of 8.7%[129]. - Revenue from Hong Kong decreased to HKD 5,123,788, down 13.2% from HKD 5,906,458 in 2022[68]. - Revenue from Mainland China increased to HKD 376,476, up 29.2% from HKD 291,595 in 2022[68]. Assets and Liabilities - The company's contract assets recognized an impairment provision of approximately HKD 5,788,000 for the year ended December 31, 2023, compared to HKD 4,234,000 in 2022[2]. - The company’s total liabilities related to secured assets increased significantly, with properties pledged rising to HKD 791,345,000 in 2023 from HKD 68,300,000 in 2022[3]. - As of December 31, 2023, the group's total liabilities decreased from HKD 2,398.8 million in 2022 to HKD 2,409.2 million in 2023, reflecting a slight increase of 0.4%[112]. - The group's bank borrowings as of December 31, 2023, amounted to HKD 320 million, up from HKD 277.9 million on December 31, 2022, mainly related to the mortgage loan for the acquisition of ATAL Tower[29]. - The group’s total liabilities as of December 31, 2023, were not reclassified under the 2020 and 2022 amendments to accounting standards[139]. Cash Flow and Financing - As of December 31, 2023, the group's cash and bank balances totaled HKD 906.4 million, a decrease from HKD 976 million on December 31, 2022[29]. - The group has established foreign exchange forward contracts for planned foreign currency transactions, with no foreign currency borrowings or other hedging tools in place[35]. - The group maintains a strong cash level and sufficient committed bank credit to support its growth and development[29]. - The group had bank financing and trade financing of approximately HKD 2.6734 billion, with HKD 949.8 million utilized[57]. Dividends - The company declared a second interim dividend of HKD 0.01 per share, totaling approximately HKD 13.9 million, alongside a first interim dividend of HKD 0.0852 per share, resulting in a total dividend distribution of HKD 0.0952 per share for the fiscal year ending December 31, 2023, amounting to approximately HKD 132.4 million, based on a profit attributable to owners of HKD 251.5 million[85]. - The company declared an interim dividend of 8.52 HKD cents per share for 2023, totaling 118,562 thousand HKD, up from 4.27 HKD cents per share and 59,586 thousand HKD in 2022[162]. Market Position and Future Outlook - The company has maintained a strong market position in infrastructure operations, data centers, and housing projects, contributing positively to revenue[19]. - The company expects annual construction volume in Hong Kong to reach approximately HKD 300 billion over the next decade, driven by public sector projects[65]. - The government plans to increase annual capital expenditure to over HKD 100 billion, particularly in housing and infrastructure, presenting significant opportunities for the company[65]. - The group anticipates positive impacts on Hong Kong's economic recovery as border restrictions with mainland China are fully lifted, which is expected to gradually reflect in business performance[41]. Employee and Operational Metrics - The group employed 3,010 staff as of December 31, 2023, an increase from 2,701 in 2022[54]. - Employee costs for 2023 amounted to 1,241,659 thousand HKD, compared to 1,137,692 thousand HKD in 2022, reflecting an increase of about 9.1%[162]. Taxation - The company incurred a tax expense of HKD 11.2 million for the year, a significant decrease from HKD 61.9 million in 2022[88]. - The effective tax rate for the qualifying group entities is calculated at 8.25% for the first HKD 2 million of estimated taxable profits and 16.5% for profits exceeding HKD 2 million[157]. - The group recognized a tax expense of 35,842 thousand HKD for the year, a decrease from 66,605 thousand HKD in the previous year, indicating a reduction of approximately 46.1%[165]. Acquisitions and Investments - The company acquired Precision Lift Services Limited for a total consideration of GBP 364,591 (approximately HKD 3,466,000), with a recognized gain of approximately HKD 8,581,000 due to the fair value exceeding the purchase price[7]. - The group successfully acquired two companies in the UK, JCW and Precision, which became majority-controlled and wholly-owned subsidiaries, respectively[59]. Credit and Receivables - The total trade receivables, net of credit loss provisions, reached HKD 1,003,086,000 for the year ended December 31, 2023, compared to HKD 808,169,000 in 2022[192]. - The group has confirmed a credit loss provision of approximately HKD 21,544,000 for trade receivables without credit impairment, up from HKD 15,787,000 in 2022[185]. - The group’s expected credit loss for trade receivables with credit impairment was approximately HKD 19,403,000 for the year ended December 31, 2023, compared to HKD 13,057,000 in 2022[185].

Financial Performance - Revenue for the six months ended June 30, 2023, was HKD 2,841.1 million, a decrease of 6.0% from HKD 3,021.7 million in 2022[6]. - Gross profit for the same period was HKD 453.8 million, slightly down from HKD 457.6 million, indicating a stable gross margin[6]. - Profit attributable to owners of the company surged to HKD 237.5 million, compared to HKD 59.2 million in the previous year, reflecting a significant increase of 301%[6]. - The group recorded a total comprehensive profit of HKD 237.5 million for the six months ended June 30, 2023, representing a significant year-on-year increase of 301.4%[19]. - The group's revenue for the six months ended June 30, 2023, was HKD 2.841 billion, a slight decrease from HKD 3.022 billion for the same period in 2022[19]. - The group’s profit for the six months ended June 30, 2023, was HKD 237,520,000, a significant increase from HKD 59,175,000 in the same period of 2022, representing a growth of approximately 301%[166]. Dividends and Shareholder Returns - The company declared an interim dividend of HKD 0.0852 per share, with a payout ratio of 50% based on the unaudited net profit of HKD 237.5 million[6]. - The company declared an interim dividend of HKD 0.0852 per share, totaling HKD 118,891,000, for shareholders on record as of September 14, 2023[167]. Contract and Project Updates - The total value of contracts on hand reached HKD 12.276 billion, with a new maintenance contract value in building services engineering rising by 313% year-on-year to HKD 548.6 million[13]. - New contracts awarded in the building services engineering segment totaled HKD 2.4605 billion for the first half of 2023, down from HKD 3.5341 billion in the same period of 2022[24]. - Contract revenue from construction projects was HKD 2,219,660,000, down 11.3% from HKD 2,503,010,000 year-on-year[75]. Business Development and Strategy - The company established a new business development department focused on Smart Data Automation (SDA) to explore digital business development opportunities[13]. - The company is focusing on environmental engineering as a key development direction, capitalizing on the growing global emphasis on environmental issues[15]. - The group aims to strengthen its industry position through innovation and collaboration, ensuring readiness for future market opportunities[14]. - The group plans to activate a building in Kwai Chung as its headquarters, expected to commence operations in Q2 2024, enhancing operational efficiency and collaboration[23]. - The group plans to leverage human resources and innovative technologies to support its operational strategies in "new technology," "new markets," and "new business models"[45]. Market Outlook and Growth Opportunities - The construction industry in Hong Kong is projected to have a total engineering volume of HKD 240 billion to HKD 375 billion annually over the next decade, providing growth opportunities for the company[15]. - The overall engineering volume in Hong Kong's construction industry is expected to reach approximately HKD 300 billion annually over the next decade[110]. - The Hong Kong government plans to increase annual capital expenditure to over HKD 100 billion, focusing on housing and infrastructure investments[111]. - The group anticipates an optimistic business outlook due to strong bidding activities and growth opportunities across various business segments[110]. Financial Position and Cash Flow - The cash balance as of June 30, 2023, was HKD 835.1 million, down from HKD 976.0 million as of December 31, 2022[49]. - Cash and cash equivalents decreased to HKD 835,139,000 at the end of June 2023, down from HKD 1,073,704,000 at the end of June 2022, representing a decline of 22.15%[88]. - Net cash used in operating activities for the six months ended June 30, 2023, was HKD (76,308,000), a significant decline from HKD 399,055,000 in the same period of 2022, highlighting cash flow challenges[85]. - The group has pledged assets amounting to HKD 716.5 million as collateral for short-term bank financing and mortgage loans, compared to HKD 699.8 million as of December 31, 2022[104]. Employee and Operational Metrics - The group has employed 2,701 staff as of June 30, 2023, an increase from 2,516 staff as of June 30, 2022[108]. - The total employee costs, including directors' remuneration, amounted to HKD 656,723,000 for the six months ended June 30, 2023, down from HKD 682,067,000 in the same period of 2022, indicating a reduction of approximately 4%[156]. Technology and Innovation - The group has invested in new technologies such as digital twins, IoT, AI, and big data analytics to enhance operational efficiency and reduce costs[113]. - The group continues to adopt Building Information Modeling (BIM) and Mechanical, Electrical, and Plumbing (MiMEP) technologies to improve productivity and project quality[25]. Environmental and Sustainability Initiatives - The company is focusing on expanding its engineering capabilities and investing in advanced environmental processing technologies[81]. - The group recognizes significant business opportunities in advanced food waste processing technologies[110]. Risks and Challenges - The group does not face significant foreign exchange risks, as it primarily operates in Hong Kong, Macau, and mainland China, and has established forward contracts to manage currency risks[59]. - The company’s experience during the COVID-19 pandemic is expected to lead to improved business performance as commercial property rental rates recover[46].

Financial Performance - Revenue from the elevator and escalator business for the first half of 2023 was HKD 159.6 million, down from HKD 183.2 million in the same period of 2022, representing a decrease of 17.7%[2] - The group reported a total revenue of HKD 2.8411 billion for the first half of 2023, a decrease of HKD 180.7 million or 6.0% compared to the previous year[12] - The consolidated profit attributable to the company's owners for the six months ended June 30, 2023, was HKD 237.5 million, significantly up from HKD 59.2 million in the same period of 2022[13] - Other income for the six months ended June 30, 2023, was HKD 11.9 million, down from HKD 13.7 million in the same period of 2022, primarily due to the expiration of a lease contract[19] - The group recorded a net gain of HKD 144.5 million for the six months ended June 30, 2023, compared to a gain of HKD 25 million in the same period of 2022, mainly due to a diluted gain from a private placement in a joint venture[20] - The profit attributable to owners of the company for the six months ended June 30, 2023, was HKD 237.5 million, significantly up from HKD 59.2 million in the previous year[44] - The group recorded a consolidated net profit of HKD 237.5 million for the six months ended June 30, 2023, representing a significant increase of 301.4% year-on-year[172] Revenue Breakdown - Revenue from contracting services was HKD 2,219,660, down from HKD 2,503,010, representing a decline of 11.3%[90] - Revenue from maintenance services increased to HKD 565,122, up 23.0% from HKD 460,008 in the previous year[90] - The segment revenue breakdown shows that the building services segment generated HKD 1,747,968, while the environmental engineering segment contributed HKD 622,524[81] - The environmental engineering business generated revenue of HKD 622.5 million in the first half of 2023, up from HKD 499.5 million in the same period of 2022[178] - The ICBT business revenue for the first half of 2023 increased by 2.5% to HKD 310.9 million compared to HKD 303.4 million in the same period of 2022[180] Cash Flow and Assets - The cash balance as of June 30, 2023, was HKD 835.1 million, down from HKD 976 million as of December 31, 2022[14] - The group’s total assets as of June 30, 2023, were HKD 3,411.1 million, compared to HKD 3,519.8 million as of December 31, 2022[51] - The total accounts receivable as of June 30, 2023, was HKD 781,866,000, a decrease from HKD 808,169,000 as of December 31, 2022[155] - The group reported total liabilities of HKD 1,469,301,000 as of June 30, 2023, compared to HKD 1,494,963,000 as of December 31, 2022[156] - The group has pledged assets amounting to HKD 716.5 million as collateral for general short-term bank financing and mortgage loans, an increase from HKD 699.8 million as of December 31, 2022[185] Strategic Initiatives - Anlev has secured strategic orders from various regions including Canada, Mexico, Singapore, and mainland China during the reporting period[4] - The company aims for 60% of its engineering and frontline staff to obtain external BIM certification by mid-2024, with 36% already certified as of June 30, 2023[7] - The group has established a new business unit focused on Smart Data Automation (SDA) to enhance innovation and resource management[6] - The company plans to expand its global presence by seeking new distributors in the US, Europe, the Middle East, and Southeast Asia[5] - The group plans to operationalize the revitalized headquarters, ATAL Tower, in the second quarter of 2024 to enhance operational efficiency and collaboration[174] Employee Development - The group conducted a total of 238 internal training sessions, totaling over 23,000 hours, to enhance employee skills and knowledge in the first half of 2023[25] - The group is committed to employee development and diversity, recognizing that attracting and retaining talent is key to long-term success[189] Market Conditions and Challenges - The group plans to continue focusing on business fundamentals to overcome challenges and drive growth, including restructuring business units and enhancing corporate governance[30] - The group’s cash flow forecasts have been reassessed due to ongoing unfavorable market conditions in the U.S.[134] - The group is addressing labor shortages in the industry through government initiatives aimed at ensuring adequate workforce availability[192] Dividends and Shareholder Returns - The board declared an interim dividend of HKD 0.0852 per share, with a payout ratio of 50% based on the unaudited net profit of HKD 237.5 million[44] - The company declared an interim dividend of 8.52 HKD cents per share, totaling 118,891,000 HKD, reflecting a commitment to returning value to shareholders[113] Investment and Future Opportunities - The company aims to explore potential investment opportunities for synergy and engage in equity cooperation, including public-private partnerships for projects along the Belt and Road Initiative[160] - The group is actively seeking suitable business partnerships to expand its operations in the US and Europe, particularly focusing on the UK market[194] Financial Reporting and Compliance - The company has applied new and revised Hong Kong Financial Reporting Standards, which did not have a significant impact on the financial position and performance for the period ended June 30, 2023[57] - The financial statements for the six months ended June 30, 2023, were prepared on a historical cost basis, except for certain properties and financial instruments measured at fair value[68]

Corporate Governance - The board of directors has established an audit committee consisting of two independent non-executive directors and one non-executive director, focusing on financial monitoring and risk management[1]. - The audit committee reviewed the effectiveness of the risk management and internal control systems covering financial, operational, and compliance monitoring[20]. - The board will conduct annual reviews of the risk management and internal control systems to ensure their effectiveness[20]. - The company has a policy to promote anti-corruption laws and regulations, integrated into its code of conduct[19]. - The company has established a risk management committee to monitor and assess economic sanction risks[126]. - The company has complied with the applicable regulations regarding related party transactions as per the Listing Rules[124]. - The company has maintained the public float required by the Listing Rules[127]. - The independent auditor's report highlighted the accounting treatment of construction contracts as a key audit matter due to its significant impact on the financial statements[131]. - The company has established an effective internal control framework to identify and monitor significant risks related to sanctions laws[149]. Financial Performance - The company recognized revenue of approximately HKD 5,394,415,000 from contracting services for the year ended December 31, 2022[131]. - The company's revenue for 2022 was HKD 6,474,650,000, an increase from HKD 5,350,720,000 in 2021, representing a growth of approximately 20.9%[188]. - The operating profit before tax decreased to HKD 176,461,000 in 2022 from HKD 378,866,000 in 2021, a decline of about 53.4%[188]. - The total comprehensive income for the year was HKD 58,335,000 in 2022, a significant drop from HKD 336,557,000 in 2021, indicating a decline of about 82.7%[188]. - The company experienced a loss in the fair value of investment properties amounting to HKD 210,000 in 2022, compared to a gain of HKD 400,000 in 2021[188]. - The financial costs increased to HKD 12,095,000 in 2022 from HKD 4,910,000 in 2021, representing an increase of approximately 146.5%[188]. - The company recorded a provision for litigation liabilities amounting to HKD 150,000,000 in 2022, which was not present in 2021[188]. - The basic and diluted earnings per share for 2022 were both HKD 0.08, down from HKD 0.22 in 2021, reflecting a decrease of approximately 63.6%[188]. - The company noted a significant decrease in expected credit loss provisions, with a net amount of HKD (9,247,000) in 2022 compared to HKD 14,710,000 in 2021, indicating a reversal of losses[188]. Shareholder Matters - The company declared a special dividend of HKD 0.045 per share to shareholders as a celebration of its 45th anniversary, expected to be paid around April 28, 2023[33]. - The board does not recommend a second interim dividend for the year, pending future financial assessments[34]. - The company’s dividend policy allows all shareholders to receive dividends based on the company's articles of association[50]. - The company will suspend the transfer of shares from April 17 to April 18, 2023, to determine eligible shareholders for special dividends[35]. - The company has adopted a shareholder communication policy to facilitate effective communication between the company and its shareholders[46]. - The company emphasizes the importance of regular communication with shareholders to ensure they are well-informed about the company's strategies and performance[48]. Employee Compensation - The remuneration committee approved salary increases for full-time employees and recommended share awards as part of the company's 45th anniversary celebration[6]. - The company aims to ensure competitive compensation to attract and retain quality employees, reflecting its commitment to business development[8]. Financial Position - Total non-current assets decreased from HKD 1,380,723,000 in 2021 to HKD 1,292,414,000 in 2022, a decline of approximately 6.4%[140]. - Current assets increased from HKD 3,068,435,000 in 2021 to HKD 3,519,800,000 in 2022, an increase of approximately 14.7%[140]. - Total current liabilities rose from HKD 1,972,077,000 in 2021 to HKD 2,413,458,000 in 2022, an increase of approximately 22.3%[140]. - The total assets less current liabilities decreased from HKD 2,477,081,000 in 2021 to HKD 2,398,756,000 in 2022, a decline of approximately 3.2%[140]. - Total equity as of December 31, 2022, is HKD 2,062,906,000, a decrease from HKD 2,129,699,000 in 2021, representing a decline of approximately 3.1%[183]. - The company's reserves as of December 31, 2022, stand at HKD 2,048,906,000, a decrease of approximately 3.1% from HKD 2,115,699,000 in 2021[183]. - The deferred tax liabilities decreased to HKD 17,944,000 in 2022 from HKD 21,092,000 in 2021, reflecting a decline of about 15.9%[183]. - The total liabilities, including non-current liabilities, are HKD 2,398,756,000, down from HKD 2,477,081,000 in 2021, showing a decrease of approximately 3.2%[183]. Investments and Acquisitions - The company’s main business is investment holding, with significant subsidiaries detailed in the consolidated financial statements[31]. - The group has the option to apply a concentration test for each transaction, allowing for simplified assessment of acquired businesses and assets[67]. - When acquiring a group of assets that do not constitute a business, the group identifies and recognizes individual identifiable assets and liabilities based on their fair value[68]. - Business combinations are accounted for using the acquisition method, with the consideration transferred measured at fair value[69]. - At the acquisition date, identifiable assets and liabilities are recognized at their fair value, excluding deferred tax assets or liabilities and employee benefit-related assets or liabilities[72]. Cash Flow and Financing - Net cash generated from operating activities increased significantly to HKD 441,748,000 in 2022, compared to HKD 226,752,000 in 2021, marking an increase of approximately 94.7%[188]. - Cash and cash equivalents increased by HKD 195,247 million in 2022, compared to a decrease of HKD (319,296) million in 2021[195]. - Total cash and cash equivalents at the end of 2022 stood at HKD 976,028 million, up from HKD 801,738 million at the end of 2021, an increase of 21.7%[195]. - The company repaid bank loans amounting to HKD 234,625 million in 2022, compared to HKD 25,000 million in 2021, indicating a significant increase in debt repayment[195]. - New bank loans raised in 2022 amounted to HKD 220,000 million, down from HKD 317,500 million in 2021, a decrease of 30.8%[195]. - The cash flow from financing activities showed a net outflow of HKD 245,483 million in 2022, contrasting with a net inflow of HKD 81,464 million in 2021[195]. - The company received government grants related to property, plant, and equipment totaling HKD 842 million in 2022[195]. Shareholder Ownership - As of December 31, 2022, Dr. Pan Le Tao holds 888,650,000 shares, representing approximately 63.48% of the company's issued share capital[90][91]. - Mr. Webb David Michael has a beneficial interest in 98,242,000 shares, which accounts for 7.01% of the total[97]. - The company’s major shareholder, Arling Investment Limited, directly holds 888,650,000 shares, constituting 63.48% of the total issued share capital[93]. - The percentage of equity held by major shareholders is based on a total of 1,400,000,000 issued shares[96]. - HSBC International Trustee Limited holds 888,650,000 shares, equivalent to 63.48% of the company's shares, as a trustee[118]. Miscellaneous - The group reported a total revenue from its top five customers accounting for 51.6% of total revenue, with the largest customer contributing 18.6%[59]. - The group's charitable and other donations for the year amounted to approximately HKD 705,000, a decrease from HKD 746,000 in 2021[37]. - The total audit and non-audit service fees for the year were HKD 7,874,000, an increase from HKD 7,145,000 in 2021[41]. - The company has not granted, exercised, canceled, or forfeited any stock options under the stock option plan during the year[99]. - The company has no equity-linked agreements in place during the year, nor any that remain in effect at year-end[100]. - The company has not entered into any significant contracts with its controlling shareholders or their subsidiaries during the year[108]. - There were no interests held by directors in any competing businesses during the year[109]. - The company has adopted a stock incentive plan and a stock option plan, with details available in the financial statements[99]. - The company purchased a total of 10,800,000 shares under its share award scheme in 2022, compared to 14,000,000 shares in 2021, representing a reduction of about 22.9%[167]. - The company has established a statutory surplus reserve fund, requiring at least 10% of the after-tax profits to be allocated annually until the reserve reaches 50% of the registered capital[166]. - The company operates in various sectors, including mechanical and electrical engineering, environmental engineering, and infrastructure communication systems, indicating a diversified business model[171]. - The company has complied with the Hong Kong Financial Reporting Standards, ensuring that the financial statements reflect a true and fair view of the group's financial position as of December 31, 2022[180]. - The company has not identified any significant errors or misstatements in the financial statements due to fraud or error, ensuring a high level of assurance in the audit process[160].

Financial Performance - The company reported a revenue of HKD 6,474.7 million for the fiscal year 2022, an increase of 21% from HKD 5,350.7 million in 2021[2] - Gross profit for 2022 was HKD 1,011.5 million, up from HKD 878.4 million in 2021, reflecting a growth of approximately 15%[2] - The profit attributable to owners of the company decreased to HKD 114.6 million in 2022, down 63% from HKD 314.3 million in 2021[2] - Basic earnings per share for 2022 were HKD 0.08, compared to HKD 0.22 in 2021, indicating a decline of 64%[2] - The total comprehensive income for the year was HKD 58.3 million, a significant decrease from HKD 336.6 million in the previous year[3] - The total equity of the company as of December 31, 2022, was HKD 2,062.9 million, down from HKD 2,129.7 million in 2021[13] - The consolidated net profit for the fiscal year 2022 was HKD 114.6 million, a decrease of 63.6% year-on-year due to several special items[99] - The company's net profit for the year was HKD 1,267,595,000, an increase from HKD 1,219,863,000 in the previous year, representing a growth of approximately 3.9%[57] Revenue Breakdown - Revenue from contracting services was 5,394,415 thousand HKD in 2022, up from 4,249,701 thousand HKD in 2021, indicating a growth of about 26.9%[21] - Maintenance services generated revenue of 947,335 thousand HKD in 2022, slightly increasing from 944,743 thousand HKD in 2021[21] - Sales of goods decreased to 132,900 thousand HKD in 2022 from 156,276 thousand HKD in 2021, reflecting a decline of approximately 15.0%[21] - Revenue from Hong Kong reached HKD 5,906,458, a significant increase from HKD 4,735,067 in 2021, showcasing strong local market performance[49] - The environmental engineering business generated revenue of HKD 1.234 billion in the fiscal year 2022, up from HKD 1.117 billion in 2021, reflecting a year-on-year increase of 10.5%[135] - The ICBT business revenue increased by 27.6% year-on-year to HKD 631 million in the fiscal year 2022, compared to HKD 495 million in 2021[137] Assets and Liabilities - Non-current assets, including investment properties and property, plant, and equipment, totaled HKD 589.7 million, a slight decrease from HKD 589.9 million in 2021[5] - Current assets amounted to HKD 3,519.8 million, an increase from HKD 3,068.4 million in 2021[5] - Non-current assets totaled 1,279,260 thousand HKD as of December 31, 2022, down from 1,370,265 thousand HKD in 2021, a decrease of about 6.6%[30] - The trade receivables, net of credit loss provisions, were HKD 808,169,000, a slight decrease from HKD 846,562,000 in the previous year[64] - The company's contract assets, net of credit loss provisions, increased to HKD 1,244,364,000 from HKD 975,211,000, showing a growth of approximately 27.5%[62] Dividends and Shareholder Returns - The company declared a special dividend of HKD 0.025 per share to celebrate its 45th anniversary, with payment expected around April 28, 2023[2] - The total dividend declared for the year was HKD 160,035,000, compared to HKD 154,280,000 in the previous year, reflecting an increase of approximately 3.6%[57] Contracts and Backlog - The value of uncompleted contracts as of December 31, 2022, was HKD 11,656.3 million, slightly up from HKD 11,309.0 million in 2021[2] - The group’s backlog of contracts increased by 3.1% to HKD 11.656 billion, providing a solid foundation for future core business[128] - New contracts awarded in the fiscal year 2022 totaled HKD 4.803 billion, compared to HKD 2.924 billion in the fiscal year 2021[131] Strategic Initiatives and Future Outlook - The company is focused on expanding its service offerings in building services, environmental engineering, and ICT solutions[24] - The company plans to continue expanding its market presence, particularly in the Equipment Engineering and Environmental Engineering sectors, to drive future growth[45] - The company plans to expand its global presence by seeking new distributors in the US, Europe, the Middle East, and Southeast Asia[142] - The company anticipates that the demand for data center space in Hong Kong will double over the next five years, with a projected double-digit compound annual growth rate starting from 2022[152] Impairments and Provisions - The company reported a loss from property revaluation of (1,935) thousand HKD in 2022, compared to a gain of 6,854 thousand HKD in 2021[31] - The group recognized a credit impairment provision of approximately HKD 15.787 million for trade receivables in 2022, down from HKD 20.376 million in 2021[91] - The group confirmed an impairment loss of HKD 75.6 million related to its equity interest in Transel Elevator & Electric Inc. (TEI)[100] - The group recognized a litigation provision of HKD 150 million related to resolving several legal disputes during the fiscal year 2022[127] Operational Efficiency and Technology - The group has implemented advanced construction technologies in over 50% of its building services projects, improving installation and project management efficiency[160] - The company aims to enhance its capabilities in Building Information Modeling (BIM) by providing training and creating a suitable BIM environment for employees[176] - The company is committed to investing in smart building technology and digital transformation to meet the growing demand for professional solutions in the market[159]

Financial Performance - Total revenue for the six months ended June 30, 2022, increased by 29.5% to HKD 3,021.7 million compared to HKD 2,333.6 million in the same period of 2021[8]. - The gross profit for the same period rose to HKD 457.6 million, up from HKD 323.0 million, reflecting a significant improvement in profitability[8]. - The company reported a total comprehensive profit of HKD 119.2 million, a 5.9% increase year-on-year, although net profit attributable to shareholders decreased by 47.4% to HKD 59.2 million due to a special provision of HKD 60 million[19]. - The company reported a net profit of HKD 59,175, down 47.4% from HKD 112,526 in the prior year[85]. - Total comprehensive income for the period was HKD 33,076, significantly lower than HKD 117,497 in the same period last year[85]. - The company's diluted earnings per share decreased to HKD 4 from HKD 8 in the same period last year[85]. - The company reported a profit before tax of HKD 80,993,000 for the period, with a net profit of HKD 59,175,000 after tax expenses[121]. Revenue Breakdown - Revenue for the six months ended June 30, 2022, was HKD 3,021,720, an increase of 29.5% from HKD 2,333,618 in the same period of 2021[85]. - Revenue from contracting works was HKD 2,503,010,000, up 39.9% from HKD 1,789,242,000 year-on-year[111]. - Revenue from maintenance works decreased slightly to HKD 460,008,000, down 2.8% from HKD 472,341,000 in the previous year[111]. - Revenue from sales of goods was HKD 58,702,000, a decrease of 18.5% compared to HKD 72,035,000 in the same period last year[111]. - The segment revenue for building services was HKD 2,035,632,000, representing a significant increase from HKD 1,416,714,000 in the prior year[121]. Contracts and Awards - The total value of contracts awarded increased by 96.6% year-on-year, reaching HKD 4,631 million, indicating strong demand for the company's services[19]. - The total value of contracts on hand reached a record high of HKD 12,919 million, an 8.8% increase compared to the same period in 2021, providing a solid foundation for future growth[19]. - The company actively participated in bidding activities, submitting a total of 675 tenders or quotations valued over HKD 1 million each during the reporting period[19]. Investments and Expansion - The company continues to invest in new technologies such as Building Information Modeling (BIM) and robotic solutions to enhance operational efficiency and support the development of smart cities[11]. - The establishment of Anlev (UK) Limited marks the company's first foothold in Europe, reflecting its ambition to expand its global business footprint[14]. - The company aims to continue expanding its business in the US and European markets while seeking synergistic investment opportunities[24]. - The company is renovating the Toppy Tower industrial building to consolidate operations and improve productivity, with plans to commence operations in Q1 2024[24]. - The company plans to enhance its digital transformation in smart building technology and introduce innovative solutions to meet client demands[31]. Financial Position and Liquidity - Anlev's cash balance as of June 30, 2022, was HKD 1.0737 billion, an increase of 33.9% compared to HKD 0.802 billion on December 31, 2021[42]. - The company has maintained strong cash levels and sufficient committed bank credit to support growth and development[42]. - The company’s cash and cash equivalents increased to HKD 1,073,704 from HKD 801,738, reflecting improved liquidity[88]. - The company has pledged assets amounting to HKD 718.8 million as collateral for short-term bank financing and mortgage loans, an increase from HKD 681.3 million on December 31, 2021[65]. Employee and Operational Developments - Employee costs totaled HKD 682,067,000 for the six months ended June 30, 2022, up 18.5% from HKD 575,896,000 in the previous year[140]. - The company provided over 1,000 hours of internal training on BIM theory, software, and management for more than 500 employees in the first half of 2022[37]. - The company has launched an employee share reward plan, granting 4,500 shares to each eligible employee to enhance engagement and align interests with shareholders[69]. Strategic Initiatives and Future Outlook - The company is optimistic about future growth opportunities driven by major infrastructure projects in Hong Kong and overseas markets[15]. - The Hong Kong government plans to increase public infrastructure spending to at least HKD 100 billion annually over the next few years, with total construction output expected to reach approximately HKD 300 billion per year[73]. - The company is poised to leverage growth opportunities in the data center industry, driven by innovations in AI, robotics, IoT, big data, and data analytics[74]. - The company is committed to expanding its operations and maintenance (O&M) services by establishing new standards and enhancing its capabilities in various sectors, including hospital facilities and automated systems[76].