目錄 | 公司資料 | 2 | | --- | --- | | 主席報告書 | 3 | | 管理層討論及分析 | 4 | | 董事及高級管理人員履歷詳情 | 10 | | 董事會報告書 | 13 | | 環境、社會及管治報告 | 22 | | 企業管治報告書 | 49 | | 獨立核數師報告 | 62 | | 綜合損益表 | 67 | | 綜合損益及其他全面收益表 | 68 | | 綜合財務狀況報表 | 69 | | 綜合權益變動表 | 71 | | 綜合現金流量報表 | 72 | | 綜合財務報表附註 | 74 | | 財務概要 | 153 | | 物業資料 | 154 | 目錄 1 中國城市基礎設施集團有限公司 二零二三年年報 目錄 公司資料 董事會 執行董事 李朝波先生 （主席兼行政總裁） 季加銘先生 非執行董事 張貴卿先生 獨立非執行董事 吳志豪先生 郭堅華先生 鄺美雲女士 審核委員會 吳志豪先生 （委員會主席） 郭堅華先生 鄺美雲女士 薪酬委員會 郭堅華先生 （委員會主席） 吳志豪先生 鄺美雲女士 提名委員會 郭堅華先生 （委員會主席） 吳志豪先生 鄺美雲女士 公司秘書 陳愷賢先生 公司授權代表 李 ...

Financial Performance - The revenue from continuing operations for the year ended December 31, 2023, was approximately HKD 51,780,000, a decrease of about 21.1% compared to HKD 65,593,000 in 2022[3] - The net loss for the year was approximately HKD 111,332,000, a reduction of about 2.5% from the net loss of HKD 114,216,000 in 2022[3] - The gross profit for the year was HKD 32,508,000, slightly down from HKD 33,225,000 in 2022[5] - Basic and diluted loss per share from continuing operations was HKD 3.56, compared to HKD 3.43 in 2022[6] - The company reported a total loss of HKD 111,332,000 for the year ended December 31, 2023[22] - The group's consolidated revenue decreased by 21.1% to approximately HKD 51,800,000 for the year ended December 31, 2023, down from approximately HKD 65,600,000 in the previous year[43] - Overall gross profit decreased by 2.2% to approximately HKD 32,500,000, with a gross profit margin increase from 50.7% to 62.8%[43] - The loss from continuing operations for the year 2023 was HKD 111,332,000, a slight improvement from the loss of HKD 114,216,000 in 2022, representing a decrease of approximately 2.5%[31] Assets and Liabilities - Total assets as of December 31, 2023, were approximately HKD 1,229,839,000, down about 12.3% from HKD 1,402,305,000 in 2022[3] - The total liabilities decreased to HKD 573,440,000 in 2023 from HKD 609,841,000 in 2022[11] - The company's equity attributable to owners decreased to HKD 656,399,000 from HKD 792,464,000 in 2022[10] - The debt-to-equity ratio increased to approximately 50.5% as of December 31, 2023, compared to 44.2% in 2022[3] - The debt-to-asset ratio increased to approximately 50.5% as of December 31, 2023, compared to 44.2% in 2022, primarily due to the net loss incurred during the year[72] - Total borrowings, including bank loans and other loans, were approximately HKD 344.3 million as of December 31, 2023, down from HKD 367.7 million in 2022[70] Income and Expenses - Financial expenses decreased to HKD 45,200,000 in 2023 from HKD 75,436,000 in 2022, primarily due to reduced interest expenses on bank loans[23] - The income tax expense for the year was HKD 2,523,000, compared to HKD 16,889,000 in the previous year[23] - Other comprehensive expenses for the year totaled HKD 24,733,000, down from HKD 108,434,000 in 2022[8] - Total employee costs decreased to HKD 17,153,000 in 2023 from HKD 24,088,000 in 2022, reflecting a reduction of about 28.9%[26] - Administrative expenses decreased by approximately 18.1% to HKD 29,800,000, mainly due to reductions in legal, professional fees, and employee costs[64] - Other operating income decreased to approximately HKD 2,200,000 from HKD 4,600,000 in the previous year, primarily due to a reduction in government subsidies[59] Investment Properties - The fair value loss on investment properties was HKD 33,111,000, significantly higher than the loss of HKD 3,936,000 in 2022[5] - The group recorded a net fair value loss of investment properties amounting to approximately HKD 33,100,000 for the year ended December 31, 2023, compared to HKD 3,900,000 in the previous year[43] - The total fair value of the group's investment properties was approximately HKD 1,051,600,000 as of December 31, 2023, down from HKD 1,121,400,000 in the previous year[46] - The rental income generated from investment properties was approximately HKD 36,400,000, a slight decrease from HKD 36,800,000 in the previous year[46] - The total revenue from investment properties rental income was HKD (36,405,000) in 2023, slightly down from HKD (36,754,000) in 2022, indicating a decrease of about 0.9%[26] Discontinued Operations - The group’s discontinued operations included a hotel business segment, which was terminated during the year ended December 31, 2022[19] - The loss from discontinued operations for the year 2022 was HKD 6,963,000, which was fully attributed to the hotel business that was deemed unprofitable[28] Future Outlook and Strategy - The company is actively seeking potential projects compatible with its main business to support further development[42] - The management is actively seeking potential projects aligned with the company's main business, particularly in infrastructure-related sectors, amid a complex operating environment[76] Other Information - The group has not adopted the newly issued but not yet effective Hong Kong Financial Reporting Standards, which are expected to have no significant impact on future financial statements[15] - The total number of employees as of December 31, 2023, was approximately 119, with total employee costs for the year amounting to about HKD 17.2 million[75] - The current ratio was 1.04 as of December 31, 2023, down from 1.77 in 2022[72] - The company did not recommend any dividends for the years ended 2023 and 2022[29] - The company will not declare a dividend for the year ended December 31, 2023, consistent with the previous year[77] - The consolidated financial statements for the year ending December 31, 2023, have been verified by Tianjian International Certified Public Accountants, confirming the accuracy of the reported figures[88] - The annual report containing all financial and related information will be published on the Hong Kong Stock Exchange website and the company's website at an appropriate time[89]

Financial Performance - Revenue for the six months ended June 30, 2023, was HKD 30,166,000, a decrease of 20.0% compared to HKD 38,060,000 in the same period of 2022[6] - Gross profit for the same period was HKD 17,081,000, down 14.7% from HKD 20,023,000 year-on-year[6] - The company reported a loss before tax of HKD 30,010,000, improving from a loss of HKD 60,420,000 in the previous year, representing a 50.3% reduction[6] - The company recorded a total comprehensive loss of HKD 70,784,000 for the period, compared to HKD 117,270,000 in the previous year, showing an improvement of 39.5%[8] - For the six months ended June 30, 2023, the company reported a total comprehensive loss of HKD 70,784,000, compared to a total comprehensive loss of HKD 117,270,000 for the same period in 2022, representing a decrease of approximately 39.6%[15] - The company reported a loss attributable to owners of approximately HKD 30,400,000, a decrease from HKD 58,500,000 for the same period in 2022, reflecting improved financial performance[82] Assets and Liabilities - Total assets as of June 30, 2023, were HKD 1,322,587,000, down from HKD 1,402,305,000 at the end of 2022, indicating a decrease of 5.7%[10] - The company's equity attributable to owners decreased to HKD 721,680,000 from HKD 792,464,000, reflecting a decline of 8.9%[10] - Cash and cash equivalents decreased to HKD 14,047,000 from HKD 17,084,000, a decline of 17.9%[10] - The company’s total equity as of June 30, 2023, was HKD 721,680,000, a decrease from HKD 897,844,000 as of June 30, 2022, representing a decline of approximately 19.6%[15] - Total debt as of June 30, 2023, was approximately HKD 371,600,000, an increase from HKD 341,900,000 as of December 31, 2022[85] - The debt-to-asset ratio increased to 49.6% from 44.2% as of December 31, 2022, indicating a higher leverage position[86] Cash Flow - The net cash used in operating activities for the six months ended June 30, 2023, was HKD 14,356,000, compared to HKD 5,638,000 for the same period in 2022, indicating a worsening cash flow situation[18] - The company recorded a net cash inflow from financing activities of HKD 16,945,000 for the six months ended June 30, 2023, down from HKD 55,979,000 in the same period of 2022, reflecting a decrease of approximately 69.7%[18] - The company’s investment activities generated a net cash inflow of HKD 14,000 for the six months ended June 30, 2023, compared to HKD 101,307,000 in the same period of 2022, indicating a significant decrease in investment cash flow[18] Operational Changes - The company has terminated its hotel business segment, which was not profitable, to better allocate resources to other segments[26] - The hotel business was classified as discontinued operations due to ongoing losses, allowing the group to better allocate resources to other segments[43] - The group did not declare an interim dividend for the six months ended June 30, 2023, consistent with the previous year[45] - The company did not report any new product launches or technological advancements during the period[20] Revenue Breakdown - Total revenue for the property investment segment was HKD 19,219,000, while the property management segment generated HKD 10,947,000, leading to a total revenue of HKD 30,166,000 for the group[30] - Rental income from investment properties for the period was approximately HKD 19,200,000, down from HKD 21,800,000 for the same period in 2022, representing a decrease of about 11.9%[71] - Revenue from property management decreased to approximately HKD 10,900,000 from HKD 16,300,000, a decline of about 33.3% year-on-year[71] Cost Management - Administrative expenses increased to HKD 25,270,000 from HKD 23,236,000, marking an increase of 8.8%[6] - Employee costs decreased to HKD 11,221,000 from HKD 13,685,000 year-on-year, indicating cost management efforts[41] - The group's total sales cost for continuing operations decreased to approximately HKD 13,100,000 from HKD 18,200,000, a reduction of about 28.5%[72] - The overall gross profit margin for continuing operations increased to 56.6% from 52.6% in the same period last year, indicating improved profitability[73] Shareholder Information - Major shareholder LIHL holds 728,912,000 shares, representing 23.30% of the company's issued share capital as of June 30, 2023[98] - China Financial International Investment Limited (CFIIL) holds 698,079,429 shares, accounting for 22.32% of the company's issued share capital[98] - The company’s major shareholders include Good Outlook Investments Limited, holding 215,683,681 shares (6.89%)[98] Governance and Compliance - The company has adopted a new share option plan to replace the expired 2013 plan, which will be proposed at the next annual general meeting[94] - The company has maintained compliance with the corporate governance code, with the chairman also serving as the CEO, which the board believes enhances operational efficiency[103] - The company’s governance structure includes a board composed of two executive directors, one non-executive director, and three independent non-executive directors, ensuring adequate checks and balances[103] Future Outlook - The company aims to seek business opportunities to maintain market competitiveness and create value for shareholders in 2023, focusing on infrastructure-related projects[87] - The company has not disclosed specific future outlook or guidance in the provided documents[6] - As of the report date, the group has not signed any agreements for significant investments or capital assets, nor does it have any future plans regarding major investments or capital assets[111]

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佈的內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示，概不就因本公佈全部或任何 部份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。 （於開曼群島註冊成立之有限公司） 2349 （股份代號： ） 截至二零二三年六月三十日止六個月未經審核中期業績公佈 摘要 30,166,000 38,060,000 － 於本期間，營業額約為 港元，而二零二二年同期錄得約 港元。該減少主要由於本期間來自物業管理業務的營業額減少所致。 14.7% 17,081,000 － 毛利於本期間減少約 至 港元及毛利率與二零二二年同期相比 4 56.6% 增加約 個百分點至約 。 1,395,000 － 本集團之投資物業錄得公平值收益約 港元。 30,358,000 － 本集團期間虧損淨額約 港元，於二零二二年同期錄得虧損淨額約 58,455,000 港元。 ...

Financial Performance - The group's consolidated revenue decreased by 12.6% from approximately HKD 75,100,000 in 2021 to approximately HKD 65,600,000 in 2022[10]. - The overall gross profit fell by 19.0% from about HKD 41,000,000 in 2021 to approximately HKD 33,200,000 in 2022, with a gross profit margin decline from 54.6% to 50.7%[10]. - The loss attributable to the company's owners was approximately HKD 114,200,000 in 2022, compared to HKD 167,100,000 in 2021, with a basic loss per share of HKD 0.0365[10]. - For the year ended December 31, 2022, the group's revenue from continuing operations increased to approximately HKD 65,600,000, a 2.0% increase from approximately HKD 64,300,000 in the previous year[27]. - Rental income from investment properties for the year was approximately HKD 36,800,000, down from approximately HKD 39,700,000 in the previous year[27]. - Revenue from property management decreased to approximately HKD 18,200,000, compared to approximately HKD 24,700,000 in the previous year, representing a decline of about 26.5%[19][27]. - The group recorded a loss of approximately HKD 3,900,000 from fair value changes in its investment property portfolio for the year[34]. - The group recorded an income tax expense of approximately HKD 16.9 million for the year, compared to an income tax credit of about HKD 19.1 million in the previous year, mainly due to a decrease in deferred tax credits from fair value losses on investment properties[39]. - Loss attributable to the owners of the company decreased from approximately HKD 167.1 million to about HKD 114.2 million[40]. Real Estate and Development - Revenue from real estate development was approximately HKD 10,600,000, generated from the sale of 32 parking spaces in Wuhan[13]. - The occupancy rate of the Future City shopping center was 89.4% as of December 31, 2022, down from 95.0% in the previous year[14]. - The group plans to actively seek development opportunities in real estate, infrastructure, and renewable energy sectors in 2023[6]. - The total construction area of completed projects as of December 31, 2022, was 322,595 square meters, with Future City, Future Mansion, and Zhongshui Longyang Plaza contributing significantly[26]. - The group decided to terminate its hotel operations due to unprofitability, allowing better resource allocation to other segments[20]. Capital Structure and Financial Management - The company completed the acquisition of Precious Palace Enterprises Limited for approximately HKD 795,000,000 and subsequently sold it for HKD 840,000,000 in 2022[15]. - The group aims to optimize its capital structure and business portfolio to maximize shareholder value[6]. - As of December 31, 2022, the group's total cash and bank balances were approximately HKD 17.1 million, a decrease of about HKD 0.3 million from the previous year[41]. - Total borrowings, including bank loans and other loans, decreased from approximately HKD 613.5 million to about HKD 367.7 million, with no convertible bonds or promissory notes outstanding[42]. - The debt-to-equity ratio improved to approximately 44.2% from 95.1% in the previous year, primarily due to a reduction in borrowings and convertible bonds[45]. - Financial expenses for continuing operations decreased from approximately HKD 95.9 million to about HKD 75.4 million, primarily due to a reduction in actual interest expenses on convertible bonds by approximately HKD 13.4 million[38]. Employee and Governance - The total employee cost for the year was approximately HKD 24.1 million, with a total headcount of about 141 employees as of December 31, 2022[49]. - The company aims for steady recovery and stable business performance in 2023, actively seeking opportunities to maintain market competitiveness and create shareholder value[50]. - The company has established various internal control measures and training to ensure compliance with applicable laws and regulations[76]. - The company maintained directors' and senior officers' liability insurance during the year[120]. - The company continues to provide statutory benefits to all eligible employees, including mandatory provident fund and social insurance[178]. - The company is committed to investing in employee training and development to enhance skills and capabilities[196]. Environmental, Social, and Governance (ESG) - The group continues to focus on environmental, social, and governance (ESG) goals, aiming to create long-term value for stakeholders[132]. - The board of directors is responsible for setting ESG goals and monitoring their implementation, with the management team tasked with executing approved strategies[134]. - The group adheres to the Hong Kong Stock Exchange's ESG reporting guidelines and aims for sustainable business practices[132]. - The total indirect carbon dioxide emissions for 2022 were 2,329.85 tons, a decrease of 26.62% compared to 3,175.08 tons in 2021[151]. - The company has implemented policies to reduce carbon emissions and has supported reforestation initiatives[172]. - The company has taken measures to educate and guide tenants on rational water usage, despite not being able to directly control their water consumption[174]. - The company has not received any fines or warnings related to emissions from government authorities in 2022, consistent with 2021[150]. - The company has implemented energy-saving measures in its hotels, such as card-activated energy switches in guest rooms[74]. Shareholder Information - Li Chaobo holds 728,912,000 shares, representing 23.30% of the company[97]. - Ji Jiaming holds 100,000,000 shares, representing 3.20% of the company[97]. - Major shareholders include LIHL with 728,912,000 shares (23.30%) and CFIIL with 698,079,429 shares (22.32%) as of December 31, 2022[106]. - The company has a total of 312,827,854 share options available for issuance, accounting for approximately 10% of the issued share capital as of June 30, 2022[101]. - The company has not issued any new share options during the year[100]. Compliance and Legal - The company has complied with public float requirements as per listing rules[116]. - The company maintained compliance with all employment laws and regulations in China and Hong Kong, with no disputes regarding wages or benefits during the reporting period[179]. - There were no significant violations of applicable environmental laws or regulations during the review year[75].

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佈之內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示，概不就因本公佈全部或任何 部份內容而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 （於開曼群島註冊成立之有限公司） 2349 （股份代號： ） 截至二零二二年十二月三十一日止年度 全年業績公佈 摘要 65,593,000 － 本年度來自持續經營業務的營業額約 港元，而於二零二一年錄得 64,331,000 2.0% 約 港元，增幅約 。 114,216,000 － 本集團於本年度之虧損淨額約 港元，較二零二一年錄得約 167,111,000 31.7% 港元減少約 。 1,402,305,000 － 於二零二二年十二月三十一日，本集團總資產錄得約 港元，較二 2,678,160,000 47.6% 零二一年十二月三十一日約 港元減少約 。 44.2% － 於二零二二年十二月三十一日，資產負債比率約 ，而二零二一年錄得約 ...

Financial Performance - Revenue for the six months ended June 30, 2022, was HKD 38,060,000, a decrease of 7.1% from HKD 41,009,000 in the same period of 2021[9] - Gross profit for the same period was HKD 19,889,000, down 10.4% from HKD 22,258,000 year-on-year[9] - The company reported a loss before tax of HKD 61,467,000, an improvement from a loss of HKD 81,526,000 in the previous year, indicating a reduction in losses by 24.6%[9] - Total comprehensive loss for the period was HKD 117,270,000, compared to HKD 52,911,000 in the prior year, reflecting an increase in losses[12] - The company reported a total loss for the period of HKD 58,455 million[65] - The company reported a loss attributable to shareholders of approximately HKD 58,455,000 for the six months ended June 30, 2022, compared to a loss of HKD 73,089,000 for the same period in 2021[77] - The gross profit decreased from approximately HKD 22,300,000 to about HKD 19,900,000, with a gross profit margin of 52.3% compared to 54.3% in the previous year[122] Assets and Liabilities - Non-current assets decreased to HKD 1,310,590,000 as of June 30, 2022, from HKD 2,311,807,000 at the end of 2021, a decline of 43.3%[16] - Current assets totaled HKD 1,174,413,000, significantly up from HKD 366,353,000 at the end of 2021, indicating a substantial increase in liquidity[16] - The company's equity attributable to owners decreased to HKD 897,844,000 from HKD 1,015,114,000, a decline of 11.6%[16] - Total liabilities decreased to 1,587,159 thousand HKD from 1,663,046 thousand HKD, representing a reduction of approximately 4.6%[19] - Current liabilities decreased to 1,147,928 thousand HKD from 1,663,046 thousand HKD, indicating a significant reduction in short-term obligations[19] - The company reported a total equity and liabilities of 2,485,003 thousand HKD, down from 2,678,160 thousand HKD, reflecting a decrease of approximately 7.2%[19] - The company’s total assets less current liabilities amounted to 1,337,075 thousand HKD, down from 1,861,563 thousand HKD, indicating a significant decline[19] - The company’s deferred tax liabilities were reported at 121,420 thousand HKD, down from 364,810 thousand HKD, showing a decrease of approximately 66.7%[19] - The company’s borrowings due within one year decreased to 31,765 thousand HKD from 142,622 thousand HKD, indicating improved short-term debt management[19] Cash Flow and Financing - The net cash generated from operating activities was negative at (5,638) thousand HKD, compared to a positive 20,277 thousand HKD in the previous year[48] - Cash and cash equivalents at the end of the period were 17,407 thousand HKD, down from 24,572 thousand HKD year-over-year[48] - The company incurred a financing cash outflow of (83,511) thousand HKD, compared to (18,436) thousand HKD in the previous year, highlighting increased financing costs[48] - New borrowings amounted to approximately HKD 55,979,000 for the six months ended June 30, 2022, compared to HKD 83,249,000 for the same period in 2021, reflecting a decrease of approximately 32.7%[89] - The company repaid approximately HKD 117,230,000 in borrowings during the first half of 2022, which is an increase from HKD 64,699,000 in the same period of 2021[89] - The total debt of the group as of June 30, 2022, was approximately HKD 341.9 million, a decrease from HKD 613.5 million as of December 31, 2021[135] - The debt-to-equity ratio as of June 30, 2022, was 89.9%, down from 95.1% as of December 31, 2021, while the current ratio improved to 102% from 45%[136] Operational Highlights - The property investment segment generated revenue of HKD 21,792 million, while the hotel segment reported a loss of HKD 1,948 million[65] - The property development segment did not generate any revenue during the reporting period[65] - The group’s total external sales for the property management segment were HKD 16,268 million[65] - Total employee costs decreased to HKD 13,685,000 in the first half of 2022 from HKD 16,092,000 in the same period of 2021, reflecting a reduction of approximately 15.5%[75] - The total number of employees as of June 30, 2022, was approximately 178, a decrease from 183 in the previous year[168] Corporate Governance and Management - The company has maintained compliance with corporate governance codes, with some deviations noted[161] - The audit committee consists of three independent non-executive directors, with Mr. Wu Zhihao serving as the chairman[177] - The audit committee has reviewed the unaudited consolidated financial performance for the period[178] - The company appointed Mr. Li Chaobo as the new CEO on July 25, 2022, following the resignation of Mr. Ye Tianfang[176] Future Outlook and Strategy - The company plans to closely monitor industry developments and continue implementing strategic development plans to optimize its investment portfolio and reduce operating costs[137] - The ongoing COVID-19 pandemic and geopolitical tensions continue to create significant uncertainty for global economic recovery, prompting the company to adopt necessary health measures[137] - The company aims to enhance its market competitiveness and value by seizing investment opportunities arising from future economic recovery[137] Shareholder Information - The company’s major shareholders include Mr. Li Chaobo, who holds approximately 23.3% of the shares, and Mr. Ji Jiaming, who holds approximately 3.2%[141] - Major shareholders include LIHL with approximately 23.30% and CFIIL with approximately 22.32% of ordinary shares[31] - The company has a new share option plan that allows for the granting of options to subscribe for up to 312,827,854 shares, representing about 10% of the issued share capital as of June 30, 2022[146] Investment and Assets - The company has a total of approximately HKD 1.26 billion in properties and related assets pledged as collateral for bank financing as of June 30, 2022[135] - The total fair value of the Future City shopping center as of June 30, 2022, was approximately HKD 1,133,000,000, generating rental income of about HKD 15,000,000 during the period[111] - The total fair value of the Longgang property was approximately HKD 912,000,000 as of June 30, 2022, with rental income of about HKD 6,800,000 during the period[114] - The company has not sold any investment properties during the first half of 2022, consistent with the previous year[81] - As of June 30, 2022, the company did not hold any significant investments[172] - The company has no current agreements or future plans for significant investments or capital assets[171]

Financial Performance - The group's consolidated revenue increased by 1.9% from approximately HKD 73.7 million in 2020 to approximately HKD 75.1 million in 2021[12] - The overall gross profit rose by 40.9% from approximately HKD 29.1 million in 2020 to approximately HKD 41.0 million in 2021, with a gross profit margin increasing from 39.5% to 54.6%[12] - The group reported a loss attributable to owners of approximately HKD 167.1 million for the year ended December 31, 2021, compared to a loss of HKD 85.3 million in 2020[12] - The group did not recommend any final dividend for the year ended December 31, 2021[12] - The cost of sales decreased to approximately HKD 34.1 million from HKD 44.6 million in the previous year, primarily due to reduced costs in property development[28] - Other operating income decreased from approximately HKD 43,000,000 to approximately HKD 8,800,000, primarily due to a reduction in interest income and COVID-19 related rent concessions[30] - Other operating expenses decreased significantly from approximately HKD 91,200,000 to approximately HKD 2,000,000, mainly due to impairment losses in goodwill and property inventory[31] - The fair value change of investment properties resulted in a loss of approximately HKD 76,500,000 for the current year, compared to a loss of HKD 235,400,000 in the previous year[32] - Selling and distribution expenses decreased by 29.4% from approximately HKD 3,400,000 to approximately HKD 2,400,000, attributed to reduced advertising and promotion costs[33] - Administrative expenses decreased by 17.0% from approximately HKD 68,300,000 to approximately HKD 56,700,000, mainly due to reduced employee costs[35] - Financial expenses decreased from approximately HKD 149,100,000 to approximately HKD 96,200,000, primarily due to lower interest expenses on bank acceptances and borrowing costs[36] - The company recorded a tax credit of approximately HKD 19,100,000 for the current year, down from HKD 58,100,000 in the previous year[37] - The debt-to-asset ratio increased to 95.1% from 76.2% in the previous year, primarily due to increases in convertible bonds and borrowings[42] Real Estate and Property Management - The average selling price for real estate was HKD 12,326 per square meter, with a total sold area of 1,363 square meters in 2020[14] - The occupancy rate of the Future City shopping center reached 95% as of December 31, 2021, up from 92% a year earlier[15] - The group completed the acquisition of Precious Palace Enterprises Limited for approximately HKD 795 million on July 19, 2019[16] - As of December 31, 2021, the total fair value of the Future City and Longgang properties was approximately HKD 2,131.7 million, a slight decrease from HKD 2,146.4 million in 2020[17] - Rental income from investment properties for the year ended December 31, 2021, was approximately HKD 39.7 million, up from HKD 30.5 million in 2020, with an average occupancy rate of 93.9%[17] - Revenue from the Future City Hotel for the year ended December 31, 2021, was approximately HKD 10.8 million, compared to HKD 7.9 million in 2020, with an average occupancy rate of 33%[19] - Revenue from property management services increased to approximately HKD 24.7 million for the year ended December 31, 2021, from HKD 18.5 million in 2020[20] - The Longgang property has a total land area of 14,971 square meters and a total construction area of 36,876 square meters, with a current occupancy rate of 95%[24] - The Future City project covers a total area of 19,191 square meters with a total construction area of 145,273 square meters, located in a prime commercial area of Wuhan[20] Corporate Governance and Compliance - The company emphasizes the importance of maintaining good relationships with suppliers and customers to achieve its short-term and long-term goals[68] - The company is committed to enhancing governance, promoting employee welfare, and protecting the environment to fulfill its social responsibilities and achieve sustainable growth[70] - The company has implemented various internal control measures and training to ensure compliance with applicable laws and regulations[72] - The company has not violated any laws or regulations that significantly impact its operations during the review year[72] - The company has a strong commitment to corporate governance and compliance with relevant laws and regulations[70] - The audit committee reviewed the financial performance for the year ending December 31, 2021, and confirmed compliance with applicable accounting standards[110] - The company maintained compliance with public float requirements as per listing rules as of the report date[114] Environmental, Social, and Governance (ESG) Initiatives - The company has integrated its environmental, social, and governance (ESG) management system to enhance board-level oversight[128] - The company has maintained a team responsible for coordinating all ESG-related matters and regularly engages with stakeholders to assess their opinions on ESG strategies[128] - The company emphasizes sustainable development efforts and has included all subsidiaries in its ESG report for the fiscal year ending December 31, 2021[126] - The company has established communication channels with stakeholders, including shareholders, employees, customers, and suppliers, to address their concerns and ensure transparency[131] - The company has committed to aligning its operations with ESG reporting guidelines and relevant legal requirements in China[131] - The company has recognized the importance of continuous improvement in ESG measures based on annual business challenges[128] - Indirect CO2 emissions increased by approximately 34.57% from 2,359.41 tons in 2020 to 3,175.08 tons in 2021 due to increased operational activities[138] - CO2 emissions from the Hong Kong office rose by 3.95% to 12.35 tons, while emissions from Wuhan surged by 34.73% to 3,162.73 tons[138] - The company aims to reduce indirect CO2 emissions by 1% to 2% in the coming year through various environmental measures[141] - The company reported no violations of environmental laws or regulations in 2021, consistent with 2020 performance[141] - The company has committed to improving its environmental performance by reducing CO2 emissions and other pollutants while conserving natural resources[149] Employee Relations and Workforce - The total number of employees remained stable at 178 in 2021, the same as in 2020, with no significant changes in employment structure[171] - The employee turnover rate for the company was 5.62% in 2021, showing a slight increase from previous years[186] - The company maintained compliance with all employment laws in China and Hong Kong, with no disputes regarding salaries, benefits, or working conditions reported[170] - The company provided statutory benefits to all eligible employees, including mandatory provident funds and social insurance[170] - The gender distribution of employees in 2021 was 101 males and 77 females, compared to 109 males and 102 females in 2020[175] - The company has implemented policies to ensure equal opportunities in hiring, promotions, and compensation, free from discrimination[168] - The training participation rate for employees in 2021 was 30.90%, a decrease from 43.60% in 2020[195] - The average training hours per employee in 2021 were 3.66 hours, down from 4.14 hours in 2020[197] - Male employees received an average of 461.62 training hours in 2021, while female employees received 189.38 hours[197] - The company has not faced any labor lawsuits or allegations during the reporting period of 2021, consistent with the performance in 2020[198]

中國城市基礎設施集團有限公司 China City Infrastructure Group Limited (於開曼群島註冊成立之有限公司) 胎份代號：2349 : = 2021 中期報告 目錄 中國城市基礎設施集團有限公司 二零二一年中期報告 中國城市基礎設施集團有限公司 二零二一年中期報告 目錄 1 目錄 | --- | --- | |------------------------------|-------| | | | | | | | 公司資料 | | | 簡明綜合損益表 | | | 簡明綜合損益及其他全面收益表 | | | 簡明綜合財務狀況報表 | | | 簡明綜合權益變動表 | | | 簡明綜合現金流量報表 | | | 簡明綜合財務報表附註 | | | 管理層討論及分析 | | | 權益披露 | | | 企業管治 | | | 其他資料 | | 2 3 4 5 7 8 9 23 28 32 33 公司資料 中國城市基礎設施集團有限公司 二零二一年中期報告 公司資料 董事會 執行董事 李朝波先生（主席） 季加銘先生 葉天放先生（行政總裁） 非執行董事 張貴卿先生 獨立非執行董事 吳志豪先生 郭堅華 ...

[Company Information](index=3&type=section&id=Company%20Information) The company, China City Infrastructure Group Limited, is incorporated in the Cayman Islands with stock code 2349 [Company Basic Information](index=3&type=section&id=Company%20Basic%20Information) China City Infrastructure Group Limited is incorporated in the Cayman Islands with stock code 2349, providing details on its board, registered office, and auditors - The company is incorporated in the Cayman Islands, stock code 2349[1](index=1&type=chunk) - The Board of Directors includes Mr. Li Chaobo (Chairman), Mr. Ye Tianfang (Chief Executive Officer) as executive directors, a non-executive director, and independent non-executive directors[8](index=8&type=chunk) - The company has established an Audit Committee, Remuneration Committee, and Nomination Committee to enhance corporate governance[8](index=8&type=chunk) [Chairman's Statement](index=4&type=section&id=Chairman's%20Statement) The Chairman's Statement reviews the 2020 performance, highlighting challenges from the COVID-19 pandemic and strategic adjustments, while expressing optimism for 2021 recovery [2020 Annual Performance Overview and Outlook](index=4&type=section&id=2020%20Annual%20Performance%20Overview%20and%20Outlook) The 2020 performance was severely impacted by the COVID-19 pandemic, leading to strategic asset disposals and an optimistic outlook for 2021 recovery - In 2020, the global COVID-19 pandemic severely challenged the Group's property and hotel businesses[10](index=10&type=chunk) - The Group completed the disposal of a property-holding company in Yuhang District, Hangzhou, to optimize its capital structure and improve financial position[11](index=11&type=chunk) - Looking ahead to 2021, the pandemic's impact is expected to recede, and the Group will actively seek business opportunities for a steady recovery[57](index=57&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the Group's business, strategic direction, and a detailed review of its financial and operational performance for the year [Business Overview and Strategic Direction](index=5&type=section&id=Business%20Overview%20and%20Strategic%20Direction) The Group primarily engages in property-related and infrastructure businesses, with a strategy to optimize resource allocation through timely property disposals and seeking new compatible projects - The Group primarily engages in property-related businesses and infrastructure businesses[16](index=16&type=chunk) - The Group will timely dispose of certain property portfolios based on market changes to optimize resource allocation[16](index=16&type=chunk) - Management actively seeks potential projects compatible with its core businesses to support further development[16](index=16&type=chunk) [Performance Summary](index=5&type=section&id=Performance%20Summary) In 2020, the Group's consolidated revenue decreased by 27.1% to HKD 73.7 million, with gross profit down 47.5% to HKD 29.1 million, resulting in a narrowed loss attributable to owners of HKD 85.3 million 2020 Key Financial Indicators | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Consolidated Revenue | 73,700 | 101,100 | -27.1% | | Gross Profit | 29,100 | 55,400 | -47.5% | | Gross Margin | 39.5% | 54.8% | -15.3 percentage points | | Net Fair Value Loss on Investment Properties | 235,400 | (2,100) | Significant increase | | Goodwill Impairment Loss | 40,000 | - | New | | Impairment Loss on Properties Held for Sale | 41,700 | - | New | | Loss Attributable to Owners of the Company | (85,300) | (175,900) | 51.5% (narrowed) | | Basic Loss Per Share (HK cents) | (2.73) | (5.66) | 51.7% (narrowed) | - The Board does not recommend the payment of any final dividend for the year ended December 31, 2020[17](index=17&type=chunk) [Business Review](index=6&type=section&id=Business%20Review) The Group's property development revenue grew by 40% to HKD 16.8 million, but average selling price declined, while property investment, hotel, and property management revenues all decreased due to the pandemic [China Property Development Business](index=6&type=section&id=China%20Property%20Development%20Business) In 2020, the Group's property development revenue increased by 40% to HKD 16.8 million, with total GFA sold up 73.4% to 1,363 square meters, despite a 19.3% decrease in average selling price Property Development Business Key Data | Indicator | 2020 | 2019 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue (HKD thousands) | 16,800 | 12,000 | +40.0% | | Total GFA Sold (square meters) | 1,363 | 786 | +73.4% | | Average Selling Price (HKD/square meter) | 12,326 | 15,267 | -19.3% | [China Property Investment Business](index=6&type=section&id=China%20Property%20Investment%20Business) The Group's property investment business, including Wuhan Future City Shopping Mall and Shenzhen Longgang Property, maintained high occupancy rates above 92%, but rental income decreased by 15.2% to HKD 30.5 million in 2020 - Wuhan Future City Shopping Mall maintained an occupancy rate over **92%**, and Shenzhen Longgang Property over **95%**[19](index=19&type=chunk)[21](index=21&type=chunk) Property Investment Business Key Data | Indicator | 2020 | 2019 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Rental Income (HKD thousands) | 30,500 | 36,000 | -15.2% | | Average Occupancy Rate | 82.9% | 84.4% | -1.5 percentage points | - The Group completed the disposal of a 70% equity interest in Northern Sea Development Limited, which indirectly holds Meilai International Center, in 2020[20](index=20&type=chunk) [China Hotel Business](index=7&type=section&id=China%20Hotel%20Business) Future City Grand Hotel's revenue significantly decreased by 66.1% to HKD 7.9 million in 2020, with average occupancy falling to 36.6%, primarily due to the pandemic Hotel Business Key Data | Indicator | 2020 | 2019 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue (HKD thousands) | 7,900 | 23,300 | -66.1% | | Average Occupancy Rate | 36.6% | 79.1% | -42.5 percentage points | [China Property Management Business](index=7&type=section&id=China%20Property%20Management%20Business) In 2020, property management business revenue decreased by 37.9% to HKD 18.5 million, reflecting the impact of the pandemic on service demand Property Management Business Key Data | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue (HKD thousands) | 18,500 | 29,800 | -37.9% | [Group Projects](index=7&type=section&id=Group%20Projects) The Group's property portfolio includes completed integrated development projects in Wuhan, such as Future City and Zhongshui Longyang Plaza, and Shenzhen Longgang Property, totaling 359,471 square meters - The Group owns completed projects in Wuhan, including Future City, Future Mansion, and Zhongshui Longyang Plaza, with a total GFA of **322,595 square meters**[27](index=27&type=chunk)[28](index=28&type=chunk)[35](index=35&type=chunk) - Shenzhen Longgang Property has a total GFA of **36,876 square meters** and potential for redevelopment[30](index=30&type=chunk)[35](index=35&type=chunk) - A 70% equity interest in Hangzhou Meilai International Center was disposed of in 2020[29](index=29&type=chunk) 2020 Revenue and Key Indicators by Business Segment | Business Segment | 2020 Revenue (HKD thousands) | 2019 Revenue (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Property Development | 16,800 | 12,000 | +40.0% | | Property Leasing | 30,500 | 36,000 | -15.2% | | Hotel Business | 7,900 | 23,300 | -66.1% | | Property Management | 18,500 | 29,800 | -37.9% | | **Other Indicators** | | | | | Property Development GFA Sold (square meters) | 1,363 | 786 | +73.4% | | Property Development Average Selling Price (HKD/square meter) | 12,326 | 15,267 | -19.3% | | Future City Occupancy Rate | >92% | 94% | Slight decrease | | Longgang Property Occupancy Rate | >95% | 95% | Stable | | Investment Property Average Occupancy Rate | 82.9% | 84.4% | Slight decrease | | Future City Grand Hotel Average Occupancy Rate | 36.6% | 79.1% | Significant decrease | - The Group completed the disposal of a 70% equity interest in Northern Sea Development Limited, which indirectly holds Meilai International Center, in 2020[20](index=20&type=chunk)[29](index=29&type=chunk) [Financial Review](index=9&type=section&id=Financial%20Review) In 2020, the Group's turnover decreased by 27.1% to HKD 73.7 million, gross profit by 47.5% to HKD 29.1 million, and gross margin to 39.5%, while other operating income increased and other operating expenses significantly rose due to impairment losses, leading to a narrowed loss attributable to owners of HKD 85.3 million [Revenue](index=9&type=section&id=Revenue) In 2020, total revenue decreased by 27.1% to HKD 73.7 million, with property development revenue increasing by 40% to HKD 16.8 million, while property leasing, hotel, and property management revenues declined Revenue Composition | Business Type | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 73,700 | 101,100 | -27.1% | | Property Development Revenue | 16,800 | 12,000 | +40.0% | | Property Leasing Revenue | 30,500 | 36,000 | -15.2% | | Hotel Business Revenue | 7,900 | 23,300 | -66.1% | | Property Management Business Revenue | 18,500 | 29,800 | -37.9% | [Cost of Sales](index=9&type=section&id=Cost%20of%20Sales) In 2020, cost of sales decreased by 2.4% to HKD 44.6 million, primarily due to reduced hotel business costs, partially offset by increased costs in property development and property management businesses Cost of Sales Composition | Business Type | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (HKD thousands) | | :--- | :--- | :--- | :--- | | Total Cost of Sales | 44,600 | 45,700 | -1,100 | | Property Investment Business | 3,400 | 5,700 | -2,300 | | Hotel Business | 15,900 | 19,100 | -3,200 | | Property Development Business | 10,400 | 6,000 | +4,400 | | Property Management Business | 14,800 | 14,700 | +100 | [Gross Profit and Gross Margin](index=10&type=section&id=Gross%20Profit%20and%20Gross%20Margin) In 2020, gross profit decreased by 47.5% to HKD 29.1 million, with gross margin falling from 54.8% in 2019 to 39.5%, mainly due to a reduction in property management business gross profit Gross Profit and Gross Margin | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 29,100 | 55,400 | -47.5% | | Gross Margin | 39.5% | 54.8% | -15.3 percentage points | | Property Management Business Gross Profit | 3,700 | 15,100 | -75.5% | [Other Operating Income](index=10&type=section&id=Other%20Operating%20Income) In 2020, other operating income increased by 36.9% to HKD 43.0 million, primarily influenced by higher interest income, gain on disposal of investment properties, COVID-19 related rental concessions, and exchange differences Other Operating Income Composition | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (HKD thousands) | | :--- | :--- | :--- | :--- | | Total Other Operating Income | 43,000 | 31,400 | +11,600 | | Increase in Interest Income | 16,100 | - | New | | Gain on Disposal of Investment Properties | 1,500 | - | New | | COVID-19 Related Rental Concessions Received | 9,100 | - | New | | Decrease in Exchange Differences | (15,900) | - | Decrease | [Other Operating Expenses](index=10&type=section&id=Other%20Operating%20Expenses) In 2020, other operating expenses significantly increased by 462.7% to HKD 95.1 million, mainly due to substantial impairment losses on goodwill, properties held for sale, and right-of-use assets Other Operating Expenses Composition | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (HKD thousands) | | :--- | :--- | :--- | :--- | | Total Other Operating Expenses | 95,100 | 16,900 | +78,200 | | Increase in Goodwill Impairment Loss | 27,000 | - | New | | Increase in Impairment Loss on Properties Held for Sale | 41,700 | - | New | | Increase in Impairment Loss on Right-of-Use Assets | 2,900 | - | New | [Fair Value Changes of Investment Properties](index=10&type=section&id=Fair%20Value%20Changes%20of%20Investment%20Properties) In 2020, fair value changes of investment properties resulted in a net loss of HKD 235.4 million, a significant shift from a gain of HKD 2.1 million in 2019 Fair Value Changes of Investment Properties | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | | :--- | :--- | :--- | | Fair Value Changes | (235,400) (Loss) | 2,100 (Gain) | [Selling and Distribution Expenses](index=10&type=section&id=Selling%20and%20Distribution%20Expenses) In 2020, selling and distribution expenses decreased by 37.0% to HKD 3.4 million, primarily due to reduced advertising, promotion, and commission expenses for property sales and investment property businesses Selling and Distribution Expenses | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Selling and Distribution Expenses | 3,400 | 5,400 | -37.0% | [Administrative Expenses](index=10&type=section&id=Administrative%20Expenses) In 2020, administrative expenses increased by 4.1% to HKD 68.3 million Administrative Expenses | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 68,300 | 65,600 | +4.1% | [Finance Costs](index=10&type=section&id=Finance%20Costs) In 2020, finance costs increased by 5.1% to HKD 149.1 million, mainly due to higher interest on convertible bonds and promissory notes, partially offset by reduced borrowing costs Finance Costs | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Finance Costs | 149,100 | 141,900 | +5.1% | | Increase in Interest on Convertible Bonds and Promissory Notes | 23,000 | - | New | | Decrease in Borrowing Costs | (15,200) | - | Decrease | [Income Tax Credit (Expense)](index=10&type=section&id=Income%20Tax%20Credit%20(Expense)) In 2020, the Group recorded an income tax credit of HKD 58.1 million, a reversal from an income tax expense of HKD 38.1 million in 2019, primarily due to increased deferred tax credit from fair value losses on investment properties Income Tax Credit (Expense) | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | | :--- | :--- | :--- | | Income Tax Credit (Expense) | 58,100 (Credit) | (38,100) (Expense) | - The increase in income tax credit is mainly due to increased fair value losses on investment properties, leading to higher deferred tax credits[45](index=45&type=chunk) [Loss Attributable to Owners of the Company](index=11&type=section&id=Loss%20Attributable%20to%20Owners%20of%20the%20Company) In 2020, the loss attributable to owners of the Company narrowed to HKD 85.3 million from HKD 175.9 million in 2019 Loss Attributable to Owners of the Company | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Loss Attributable to Owners of the Company | (85,300) | (175,900) | 51.5% (narrowed) | 2020 Key Financial Performance | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 73,700 | 101,100 | -27.1% | | Cost of Sales | 44,600 | 45,700 | -2.4% | | Gross Profit | 29,100 | 55,400 | -47.5% | | Gross Margin | 39.5% | 54.8% | -15.3 percentage points | | Other Operating Income | 43,000 | 31,400 | +36.9% | | Other Operating Expenses | 95,100 | 16,900 | +462.7% | | Fair Value Changes of Investment Properties | (235,400) (Loss) | 2,100 (Gain) | From gain to loss | | Selling and Distribution Expenses | 3,400 | 5,400 | -37.0% | | Administrative Expenses | 68,300 | 65,600 | +4.1% | | Finance Costs | 149,100 | 141,900 | +5.1% | | Income Tax Credit (Expense) | 58,100 (Credit) | (38,100) (Expense) | From expense to credit | | Loss Attributable to Owners of the Company | (85,300) | (175,900) | 51.5% (narrowed) | - The increase in other operating income is primarily due to higher interest income, gain on disposal of investment properties, COVID-19 related rental concessions, and exchange differences[39](index=39&type=chunk) - The significant increase in other operating expenses is mainly due to impairment losses on goodwill, properties held for sale, and right-of-use assets[40](index=40&type=chunk) [Liquidity, Financial and Capital Resources](index=11&type=section&id=Liquidity,%20Financial%20and%20Capital%20Resources) In 2020, the Group's bank balances and cash significantly increased to HKD 122.4 million, total borrowings decreased, and the gearing ratio improved from 137.5% to 76.2%, with the current ratio rising to 1.37, indicating an improved financial position and no significant contingent liabilities [Cash Position](index=11&type=section&id=Cash%20Position) As of December 31, 2020, the Group's total bank balances and cash amounted to approximately HKD 122.4 million, an increase of HKD 101.2 million from 2019 Cash Position | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (HKD thousands) | | :--- | :--- | :--- | :--- | | Total Bank Balances and Cash | 122,400 | 21,200 | +101,200 | [Borrowings and Pledges of Group Assets](index=11&type=section&id=Borrowings%20and%20Pledges%20of%20Group%20Assets) As of December 31, 2020, the Group's total borrowings were HKD 547.0 million, with convertible bond liability portion at HKD 393.8 million and promissory notes at HKD 52.9 million, while approximately HKD 1,367.1 million of properties held for sale, investment properties, trade receivables, and bank deposits were pledged as collateral for bank financing Borrowings Composition | Borrowing Type | 2020 (HKD thousands) | 2019 (HKD thousands) | | :--- | :--- | :--- | | Bank and Other Loans | 547,000 | 886,500 | | Convertible Bonds Liability Portion | 393,800 | 373,100 | | Promissory Notes | 52,900 | 357,400 | | **Repayment Term** | | | | Repayable within one year | 89,600 | 274,400 | | Repayable after one year | 457,400 | 612,100 | - Total assets of approximately **HKD 1,367.1 million**, including properties held for sale, investment properties, trade receivables, and bank deposits, were pledged as collateral for bank financing[49](index=49&type=chunk) [Gearing Ratio](index=11&type=section&id=Gearing%20Ratio) As of December 31, 2020, the gearing ratio significantly decreased to 76.2% from 137.5% in 2019, and the current ratio improved to 1.37, indicating an improved financial position Gearing Ratio and Current Ratio | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Gearing Ratio | 76.2% | 137.5% | | Current Ratio | 1.37 | 1.17 | - The decrease in gearing ratio is primarily due to a reduction in promissory notes and borrowings by approximately **HKD 304.5 million** and **HKD 339.5 million**, respectively[50](index=50&type=chunk) [Contingent Liabilities and Commitments](index=12&type=section&id=Contingent%20Liabilities%20and%20Commitments) As of December 31, 2020, the Group had no significant contingent liabilities, as the subsidiary involved in guarantee-related legal risks in 2019 was disposed of during the year - As of December 31, 2020, the Group had no significant contingent liabilities[53](index=53&type=chunk) - Legal risks related to subsidiary guarantees existing in 2019 were released due to the disposal of that subsidiary[52](index=52&type=chunk)[53](index=53&type=chunk) Liquidity and Financial Indicators | Indicator | 2020 (HKD thousands) | 2019 (HKD thousands) | YoY Change (HKD thousands) | | :--- | :--- | :--- | :--- | | Total Bank Balances and Cash | 122,400 | 21,200 | +101,200 | | Total Borrowings | 547,000 | 886,500 | -339,500 | | Convertible Bonds Liability Portion | 393,800 | 373,100 | +20,700 | | Promissory Notes | 52,900 | 357,400 | -304,500 | | Gearing Ratio | 76.2% | 137.5% | -61.3 percentage points | | Current Ratio | 1.37 | 1.17 | +0.20 | - The gearing ratio decreased primarily due to a reduction in promissory notes and borrowings[50](index=50&type=chunk) - There were no significant contingent liabilities during the year, as the relevant subsidiary was disposed of[53](index=53&type=chunk) [Disposals](index=12&type=section&id=Disposals) In December 2020, the Group disposed of a 70% equity interest in Northern Sea Development Limited and its subsidiaries for approximately HKD 1 million, with no other significant acquisitions or disposals during the year - The Group entered into a sale and purchase agreement with Fit Energy Holdings Limited on December 15, 2020, to dispose of a 70% equity interest in Northern Sea Development Limited and its subsidiaries for a total consideration of approximately **HKD 1 million**[54](index=54&type=chunk) - The disposal was completed on December 31, 2020[54](index=54&type=chunk) - There were no other significant acquisitions or disposals during the year[55](index=55&type=chunk) [Employees and Remuneration Policy](index=12&type=section&id=Employees%20and%20Remuneration%20Policy) As of December 31, 2020, the Group had approximately 183 employees with a total staff cost of HKD 36.4 million, offering comprehensive remuneration and welfare plans Employee and Remuneration Data | Indicator | 2020 | | :--- | :--- | | Total Number of Employees | 183 persons | | Total Staff Costs | 36,400 HKD thousands | - The Group provides comprehensive remuneration and employee welfare plans for its staff[56](index=56&type=chunk) [Prospects and Future Plans](index=12&type=section&id=Prospects%20and%20Future%20Plans) Looking ahead to 2021, the Group anticipates a gradual fading of the COVID-19 pandemic's impact and a steady global economic recovery, actively seeking business opportunities to maintain market competitiveness and create shareholder value - Looking ahead to 2021, the impact of the COVID-19 pandemic is expected to gradually recede, with the global economy in recovery[57](index=57&type=chunk) - The company will actively seek business opportunities to maintain market competitiveness and create value for shareholders[57](index=57&type=chunk) - Management will continue to monitor the development of the novel coronavirus pandemic and its impact on the Group's operations and performance[57](index=57&type=chunk) [Biographical Details of Directors and Senior Management](index=13&type=section&id=Biographical%20Details%20of%20Directors%20and%20Senior%20Management) This section provides detailed biographical information for the Group's directors and senior management, highlighting their extensive experience in various fields [Directors' Biographies](index=13&type=section&id=Directors'%20Biographies) This chapter details the biographies of the Group's Board members, including executive directors Mr. Li Chaobo (Chairman), Mr. Ji Jiaming, Mr. Ye Tianfang (Chief Executive Officer), non-executive director Mr. Zhang Guiqing, and independent non-executive directors Mr. Wu Zhihao, Mr. Guo Jianhua, and Ms. Kwong Mei Wan, showcasing their extensive experience in real estate, finance, and corporate management - Mr. Li Chaobo serves as Chairman and Executive Director, with extensive experience in brand management, property development, and financial investment[62](index=62&type=chunk) - Mr. Ye Tianfang serves as Executive Director and Chief Executive Officer, possessing rich management experience in the real estate and finance sectors[64](index=64&type=chunk) - Independent Non-executive Directors Mr. Wu Zhihao, Mr. Guo Jianhua, and Ms. Kwong Mei Wan bring extensive experience in their respective professional fields (accounting, real estate, business investment), providing independent judgment to the Board[66](index=66&type=chunk)[67](index=67&type=chunk)[70](index=70&type=chunk) [Directors' Report](index=16&type=section&id=Directors'%20Report) The Directors' Report covers the Group's business and financial performance, share capital, reserves, borrowings, board and shareholder interests, and corporate governance compliance [Business and Financial Performance](index=16&type=section&id=Business%20and%20Financial%20Performance) The Company is an investment holding company with subsidiaries primarily engaged in property investment, development, hotel, and property management, with 2020 performance detailed in the consolidated statement of profit or loss, no dividends recommended, and a commitment to stakeholder relations and environmental compliance - The Company is an investment holding company, with its principal subsidiaries engaged in property investment, development, hotel, and property management businesses[75](index=75&type=chunk) - The Directors do not recommend the payment of a dividend for the year ended December 31, 2020[78](index=78&type=chunk) - The Group is committed to enhancing governance, promoting employee welfare, protecting the environment, and giving back to society, while complying with all applicable environmental laws, rules, and regulations[81](index=81&type=chunk)[83](index=83&type=chunk) [Share Capital, Reserves and Borrowings](index=17&type=section&id=Share%20Capital,%20Reserves%20and%20Borrowings) The report details changes in property, plant and equipment, investment properties, share capital, convertible bonds, and reserves during the year, with distributable reserves of HKD 581 million as of December 31, 2020, and no ordinary shares purchased, sold, or redeemed by the Company or its subsidiaries - Details of changes in property, plant and equipment, investment properties, share capital, convertible bonds, and reserves are provided in the notes to the consolidated financial statements[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk)[89](index=89&type=chunk) Distributable Reserves | Indicator | 2020 (HKD thousands) | | :--- | :--- | | Distributable Reserves | 581,000 | - During the year, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's ordinary shares[93](index=93&type=chunk) [Board of Directors and Shareholders' Interests](index=18&type=section&id=Board%20of%20Directors%20and%20Shareholders'%20Interests) The report lists Board members for the year, notes that some directors are subject to retirement by rotation and eligible for re-election, discloses directors' service contracts, confirms the independence of independent non-executive directors, and details interests and short positions of directors, chief executives, and substantial shareholders in the Company's shares and related shares, with the Audit Committee having reviewed the Group's annual results and risk management and internal control systems - Board members for the year included executive directors, a non-executive director, and independent non-executive directors[94](index=94&type=chunk) - Independent non-executive directors have provided annual confirmations of independence for the year ended December 31, 2020, and the Company considers them independent[100](index=100&type=chunk) Directors' and Major Shareholders' Shareholdings (December 31, 2020) | Name/Entity | Capacity | Number of Relevant Shares | Approximate Percentage | | :--- | :--- | :--- | :--- | | Mr. Li Chaobo | Beneficial owner | 738,992,000 | 23.62% | | Mr. Ji Jiaming | Beneficial owner | 100,000,000 | 3.20% | | Link Holdings Investment Holdings Limited | Beneficial owner and controlled corporation interest | 728,912,000 | 23.30% | | China Financial International Investments Limited | Beneficial owner | 698,079,429 | 22.32% | | Sky Climber Development Limited | Beneficial owner and controlled corporation interest | 863,000,000 (Convertible Bonds) | 27.59% | - The Audit Committee has reviewed the Group's audited consolidated results for the year ended December 31, 2020, as well as its risk management and internal control systems[123](index=123&type=chunk) [Corporate Governance and Compliance](index=24&type=section&id=Corporate%20Governance%20and%20Compliance) The report confirms the Group's compliance with the Listing Rules' public float requirements, no management contracts during the year, no directors' interests in competing businesses, and the purchase of directors' and officers' liability insurance, with a resolution to be proposed for re-appointment of auditors - The Company has complied with the public float requirements of the Listing Rules[126](index=126&type=chunk) - No contracts concerning the management and administration of the whole or any substantial part of the Company's business were entered into or existed during the year[127](index=127&type=chunk) - No director of the Company has any interest in any business that directly or indirectly competes or may compete with the Group's business[128](index=128&type=chunk) - The Company has purchased and maintained directors' and officers' liability insurance during the year[130](index=130&type=chunk) [Environmental, Social and Governance Report](index=25&type=section&id=Environmental,%20Social%20and%20Governance%20Report) This report details the Group's commitment to environmental protection, social responsibility, and corporate governance, covering emissions, resource use, employment, health and safety, training, labor standards, supply chain management, product responsibility, anti-corruption, and community investment [Environment](index=25&type=section&id=Environment) The Group is committed to environmental protection, with a 27.91% reduction in indirect CO2 emissions from electricity consumption in 2020, implementing various mitigation measures to reduce environmental impact and conserve resources [Emissions and Waste](index=25&type=section&id=Emissions%20and%20Waste) In 2020, the Group's operations indirectly generated 3,094 tonnes of CO2 emissions, a 27.91% year-on-year decrease, primarily due to a lower grid emission factor, with no harmful gas, noise, light, or water pollution, and a target to reduce property investment business emissions by 3% to 5% next year Carbon Dioxide Emissions | Indicator | 2020 (tonnes) | 2019 (tonnes) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Carbon Dioxide Emissions | 3,094 | 4,292 | -27.91% | - The Group's operations did not directly generate harmful gas emissions, noise, light pollution, or water pollution[137](index=137&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk)[141](index=141&type=chunk) - The Group aims to reduce CO2 emissions from its property investment business (especially in Wuhan, Hubei) by **3% to 5%** in the coming year[138](index=138&type=chunk) [Use of Resources](index=27&type=section&id=Use%20of%20Resources) In 2020, the Group's electricity consumption increased by 3.60% to 4,446,370.76 kWh due to additional operations, while freshwater consumption decreased by 26.34% to 114,611 cubic meters due to COVID-19 lockdowns, with no unreasonable resource use identified Resource Consumption | Indicator | 2020 | 2019 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Electricity Consumption (kWh) | 4,446,370.76 | 4,291,789.98 | +3.60% | | Freshwater Consumption (cubic meters) | 114,611 | 155,600 | -26.34% | - The increase in electricity consumption is mainly due to additional operations, while the decrease in freshwater consumption is due to COVID-19 lockdowns[149](index=149&type=chunk)[150](index=150&type=chunk) - The Group aims to reduce electricity consumption by **3%** under normal operating conditions and strives to maintain the downward trend in freshwater consumption[149](index=149&type=chunk)[150](index=150&type=chunk) [Environment and Natural Resources](index=29&type=section&id=Environment%20and%20Natural%20Resources) The Group's activities have not significantly impacted the environment, and it continues to comply with environmental laws and regulations, committed to resource conservation, and aims for zero complaints and zero pollution - The Group's activities have not caused significant environmental impact, and it continuously complies with environmental laws, regulations, and industry standards[157](index=157&type=chunk) - The Group is committed to resource conservation, supports reduction, reuse, and recycling measures, and collaborates with local government agencies[157](index=157&type=chunk) - The goal for the coming year is to continue achieving a record of zero complaints and zero pollution, and to explore new ways and methods to conserve natural resources and protect the environment[157](index=157&type=chunk) [Climate Change](index=30&type=section&id=Climate%20Change) The Group identifies global warming, freshwater conservation, and paper reduction as key climate issues, addressing them through efficient electricity use, afforestation support, paperless offices, and educating customers on water and paper conservation - The Group identifies global warming, freshwater conservation, and reduction of paper and paper packaging materials as climate issues that may have the greatest impact on the Group and the natural environment[158](index=158&type=chunk) - The Group reduces indirect CO2 emissions through efficient electricity use, supporting afforestation, and promoting paperless offices[158](index=158&type=chunk) - The Group has taken measures to educate, guide, and require customers to cooperate in rational water use, and has implemented measures to reduce the use of paper bags and printing paper[158](index=158&type=chunk)[159](index=159&type=chunk) Environmental Emissions and Resource Use | Indicator | 2020 | 2019 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Carbon Dioxide Emissions (tonnes) | 3,094 | 4,292 | -27.91% | | Electricity Consumption (kWh) | 4,446,370.76 | 4,291,789.98 | +3.60% | | Freshwater Consumption (cubic meters) | 114,611 | 155,600 | -26.34% | - The Group's operations do not directly generate harmful gas emissions, noise, or light pollution, and domestic and sanitary water is supplied by the urban water network[137](index=137&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk)[141](index=141&type=chunk) - The Group implements measures to conserve energy, water, and reduce paper and packaging material consumption, and is committed to reducing CO2 emissions to address climate change[147](index=147&type=chunk)[155](index=155&type=chunk)[158](index=158&type=chunk)[159](index=159&type=chunk) [Social Aspects and Scope](index=31&type=section&id=Social%20Aspects%20and%20Scope) The Group values its employees, providing fair employment, a safe work environment, and training, with 211 employees and a 17.47% turnover rate in 2020, while adhering to labor laws, managing supply chains, ensuring product responsibility, protecting data privacy, maintaining a zero-tolerance stance on corruption, and contributing to the community through employment and volunteering [Employment](index=31&type=section&id=Employment) The Group implements human-centered and fair human resource policies, providing equal opportunities and statutory benefits to all eligible employees, with a total of 211 employees in 2020 and an overall employee turnover rate of 17.47% - The Group adopts human-centered and fair human resource policies, providing equal opportunities in recruitment, promotion, remuneration, benefits, training, and dismissal[163](index=163&type=chunk) - The Group provides and maintains statutory benefits for all eligible employees, including Mandatory Provident Fund, social insurance, and medical insurance[163](index=163&type=chunk) Employee Numbers and Turnover Rate (2020) | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Total Number of Employees | 211 | 224 | | Male Employees | 109 | 107 | | Female Employees | 102 | 117 | | Employee Turnover Rate | 17.47% | - | [Health and Safety](index=34&type=section&id=Health%20and%20Safety) The Group's fundamental policy is to provide a safe, clean, and comfortable working environment, continuously improving its occupational safety and health management system, ensuring safety equipment is in place and operational, with no serious work injuries or fatalities reported during the period - The Group provides a safe, clean, and comfortable working environment and continuously improves its occupational safety and health management system[184](index=184&type=chunk) - All safety, medical, and hygiene equipment is fully in place and operating efficiently, and employees are required to strictly adhere to health and safety policies[184](index=184&type=chunk) - No serious work injuries or fatalities were reported during the reporting period[185](index=185&type=chunk) [Development and Training](index=35&type=section&id=Development%20and%20Training) The Group recognizes employee value by offering internal and on-the-job training programs covering occupational safety, work skills, and service quality, with a total of 873 training hours in 2020 - The Group provides internal and on-the-job training programs, including occupational safety, work-related skills, and service quality[190](index=190&type=chunk) Training Participation Rate and Total Hours (2020) | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Male Training Participation Rate | 52.17% | 41.25% | | Female Training Participation Rate | 47.83% | 58.75% | | Total Training Hours (hours) | 873 | 227 | [Labour Standards](index=36&type=section&id=Labour%20Standards) The Group strictly adheres to labor laws and employment ordinances in China and Hong Kong, including those on equal employment opportunities and prevention of child or forced labor, with no labor disputes or allegations reported during the period, and regular meetings with employee representatives to foster mutual understanding - The Group strictly complies with labor laws and employment ordinances in China and Hong Kong, as well as laws regarding equal employment opportunities and the prevention of child or forced labor[192](index=192&type=chunk) - During the reporting period, the Group did not violate any regulations and faced no labor disputes or allegations[192](index=192&type=chunk) - The Group regularly invites employee representatives to meetings to discuss working conditions, health, and safety issues, fostering mutual understanding[193](index=193&type=chunk) [Supply Chain Management](index=37&type=section&id=Supply%20Chain%20Management) The Group has established clear procurement management rules and guidelines, selecting suppliers based on quality, price, reliability, and compliance, including environmental performance, with all raw materials and components sourced from local Chinese suppliers and no supplier disputes or litigation reported during the period - The Group has approved and implemented policies and regulations to achieve efficient and stable supply of high-quality products and services, and manages suppliers to align with the Group's core values[198](index=198&type=chunk) - Supplier selection criteria include compliance with specifications, product and service quality, pricing, delivery time, historical record, and adherence to laws and regulations[199](index=199&type=chunk) - During the reporting period, the Group sourced all raw materials and components from local Chinese suppliers and had no disputes or litigation with suppliers[200](index=200&type=chunk) [Product Responsibility](index=37&type=section&id=Product%20Responsibility) The Group is committed to providing safe, accurate, and satisfactory services, with established customer service and complaint handling mechanisms, compliance with intellectual property laws, and an encryption system to protect sensitive data, reporting no major complaints or data breaches during the period - The Group takes all reasonable steps to ensure safe, accurate, and satisfactory services for customers, complying with all agreed or statutory requirements and industry standards[202](index=202&type=chunk) - Customer service and complaint handling mechanisms are in place, requiring on-site staff or management to immediately address issues and report serious problems to the general manager[203](index=203&type=chunk) - The Group has established an encryption system to protect sensitive and confidential data, and authorizes IT security experts to continuously monitor, maintain, and update the security system, with no data breaches reported during the period[210](index=210&type=chunk) [Anti-corruption](index=39&type=section&id=Anti-corruption) The Group maintains a zero-tolerance policy towards bribery, extortion, fraud, and money laundering, requiring all employees and suppliers to adhere to strict ethical standards, with no reported cases of bribery or corruption against the Group or its employees during the reporting period - The Group adopts a zero-tolerance policy towards bribery, extortion, fraud, and money laundering crimes[211](index=211&type=chunk) - The employee handbook and employment contracts include anti-corruption, anti-bribery, and misconduct clauses, strictly prohibiting any form of bribery and corruption[211](index=211&type=chunk) - No cases of bribery or corruption against the Group or its employees were reported during the reporting period[211](index=211&type=chunk) [Community Investment](index=39&type=section&id=Community%20Investment) The Group's property, shopping mall, and hotel management services provide nearly 200 job opportunities for low-skilled urban and rural workers, and it encourages and supports employees to participate in volunteer services to give back to the community - The Group's property, shopping mall, and hotel management services businesses provide nearly **200 job opportunities** for low-skilled urban and rural workers[212](index=212&type=chunk) - The Group continues to encourage and support employees to apply for paid leave to provide volunteer services to the community[212](index=212&type=chunk) - The Group considers employees its most valuable asset, committed to fostering a work environment that values and motivates them[162](index=162&type=chunk) Employee Data (2020) | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Total Number of Employees | 211 | 224 | | Male Employees | 109 | 107 | | Female Employees | 102 | 117 | | Employee Turnover Rate | 17.47% | 16.67% (Male) / 18.26% (Female) | - The Group strictly complies with all employment laws, regulations, and rules in China and Hong Kong, and provides a safe, clean, and comfortable working environment[165](index=165&type=chunk)[184](index=184&type=chunk) - The Group maintains a zero-tolerance policy towards bribery, extortion, fraud, and money laundering, and provides employment opportunities for low-skilled urban and rural workers[211](index=211&type=chunk)[212](index=212&type=chunk) [Corporate Governance Report](index=40&type=section&id=Corporate%20Governance%20Report) This report outlines the Group's corporate governance framework, including the Board's structure and responsibilities, the functions of its committees, diversity policy, meeting attendance, compliance with the Corporate Governance Code, director induction and training, dividend policy, company secretary's role, risk management, internal controls, securities trading standards, accountability, and communication with shareholders and investors [Board of Directors](index=40&type=section&id=Board%20of%20Directors) The Board comprises seven directors, including three executive, one non-executive, and three independent non-executive directors, with independent directors constituting 43%, meeting Listing Rules requirements; the Board is responsible for strategy and management oversight, retaining approval rights for significant transactions, conflicts of interest, and internal controls, with clear separation of Chairman and CEO duties to ensure good corporate governance [Appointment, Re-election and Removal of Directors](index=41&type=section&id=Appointment,%20Re-election%20and%20Removal%20of%20Directors) The Company's articles of association require one-third of directors to retire by rotation at each annual general meeting and be eligible for re-election, with the Nomination Committee responsible for evaluating new director candidates' experience, expertise, integrity, and independence, and new appointees receiving an induction manual and appropriate insurance - One-third of the directors are required to retire by rotation at each annual general meeting of the Company[222](index=222&type=chunk) - The Nomination Committee participates in the appointment of new directors, considering candidates' experience, expertise, integrity, and independence[222](index=222&type=chunk) - Newly appointed directors will receive an induction manual to understand Group information and director responsibilities, and appropriate insurance will be arranged[222](index=222&type=chunk) [Chairman and Chief Executive Officer](index=42&type=section&id=Chairman%20and%20Chief%20Executive%20Officer) Mr. Li Chaobo serves as the Company's Chairman and Mr. Ye Tianfang as the Chief Executive Officer, with their respective responsibilities clearly defined: the Chairman leads the Board and ensures effective operation, while the Chief Executive Officer focuses on executing Board-approved strategies and managing business operations - Mr. Li Chaobo is the Company's Chairman, and Mr. Ye Tianfang is the Chief Executive Officer, with their respective responsibilities clearly defined and documented[223](index=223&type=chunk) - The Chairman is responsible for leading the Board and ensuring its effective operation in accordance with good corporate governance practices[223](index=223&type=chunk) - The Chief Executive Officer focuses on executing the objectives, policies, and strategies approved by the Board, and is responsible for the management and operations of the Company's business[223](index=223&type=chunk) - The Board of Directors consists of seven directors, with independent non-executive directors comprising **43%** of the Board, meeting Listing Rules requirements[215](index=215&type=chunk) - The Board is responsible for formulating the Group's strategic direction and policies, overseeing management, and retaining approval authority for significant transactions, conflicts of interest, and internal controls[215](index=215&type=chunk) - The roles of Chairman and Chief Executive Officer are separated, with clearly defined responsibilities: the Chairman leads the Board, and the Chief Executive Officer manages business operations[223](index=223&type=chunk) [Board Committees](index=42&type=section&id=Board%20Committees) The Board has established an Audit Committee, Remuneration Committee, and Nomination Committee, all composed of independent non-executive directors, each with clear terms of reference to oversee financial reporting, internal controls, director remuneration policies, and director nominations, ensuring transparent and efficient corporate operations [Audit Committee](index=42&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors, is responsible for reviewing and overseeing the Group's financial reporting process, the appointment and remuneration of external auditors, internal control effectiveness, and risk management, having held two meetings in 2020 to review annual and interim results - The Audit Committee comprises three independent non-executive directors, with Mr. Wu Zhihao serving as Chairman[224](index=224&type=chunk) - Its primary responsibilities include reviewing and overseeing the Group's financial reporting process, external auditor matters, internal control effectiveness, and risk management[230](index=230&type=chunk) - Two meetings were held in 2020 with 100% attendance, reviewing the Group's annual and interim results[232](index=232&type=chunk) [Remuneration Committee](index=44&type=section&id=Remuneration%20Committee) The Remuneration Committee, composed of three independent non-executive directors, is responsible for advising the Board on the overall remuneration policy and structure for directors and senior management, and for reviewing and approving performance-based remuneration, having held two meetings in 2020 to review executive directors' remuneration and directors' fees - The Remuneration Committee comprises three independent non-executive directors, with Mr. Guo Jianhua serving as Chairman[233](index=233&type=chunk) - Its primary responsibilities include advising the Board on the overall remuneration policy and structure for directors and senior management, and reviewing and approving performance-based remuneration[234](index=234&type=chunk) - Two meetings were held in 2020 with 100% attendance, reviewing the remuneration of all executive directors and the level of directors' fees[239](index=239&type=chunk) [Nomination Committee](index=45&type=section&id=Nomination%20Committee) The Nomination Committee, comprising three independent non-executive directors, is responsible for implementing the Board's nomination policy, regularly reviewing the Board's structure, size, and composition, and advising on director appointments and succession planning, having held two meetings in 2020 to review the re-election of retiring directors - The Nomination Committee comprises three independent non-executive directors, with Mr. Guo Jianhua serving as Chairman[240](index=240&type=chunk) - Its primary responsibilities include implementing the Board's nomination policy, regularly reviewing the Board's structure, size, and composition, and advising on director appointments and succession planning[241](index=241&type=chunk) - Two meetings were held in 2020 with 100% attendance, reviewing the re-election of retiring directors[242](index=242&type=chunk) - The Board has established an Audit Committee, Remuneration Committee, and Nomination Committee to enhance Board effectiveness[221](index=221&type=chunk) - Each committee is composed of independent non-executive directors and has clear terms of reference, ensuring independent operation[224](index=224&type=chunk)[233](index=233&type=chunk)[240](index=240&type=chunk) - Committee responsibilities cover key corporate governance functions such as financial reporting review, internal controls, recommendations on director remuneration policy, and director nominations[230](index=230&type=chunk)[234](index=234&type=chunk)[241](index=241&type=chunk) [Board Diversity Policy](index=47&type=section&id=Board%20Diversity%20Policy) The Company has adopted a Board Diversity Policy, considering factors such as gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge, and length of service in the selection process to ensure a diverse range of perspectives and expertise on the Board - The Company has adopted a Board Diversity Policy, considering factors such as gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge, and length of service in the selection process[250](index=250&type=chunk) - All Board appointments are made on a merit basis, with due regard for the benefits of Board diversity[250](index=250&type=chunk) - During the reporting period, the Board comprised directors with diverse perspectives, educational backgrounds, and professional expertise, including finance, corporate management experience, and accounting qualifications[250](index=250&type=chunk) [Attendance at Meetings](index=47&type=section&id=Attendance%20at%20Meetings) During the reporting period, all directors maintained 100% attendance at Board meetings, Audit Committee, Remuneration Committee, Nomination Committee, and Annual General Meetings, demonstrating active participation in corporate governance Directors' Meeting Attendance Rate (2020) | Director Name | Board Meetings | Audit Committee Meetings | Remuneration Committee Meetings | Nomination Committee Meetings | Annual General Meeting | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Li Chaobo | 4/4 | Not applicable | Not applicable | Not applicable | 1/1 | | Mr. Ji Jiaming | 4/4 | Not applicable | Not applicable | Not applicable | 1/1 | | Mr. Ye Tianfang | 4/4 | Not applicable | Not applicable | Not applicable | 1/1 | | Mr. Zhang Guiqing | 4/4 | Not applicable | Not applicable | Not applicable | 1/1 | | Mr. Wu Zhihao | 4/4 | 2/2 | 2/2 | 2/2 | 1/1 | | Mr. Guo Jianhua | 4/4 | 2/2 | 2/2 | 2/2 | 1/1 | | Ms. Kwong Mei Wan | 4/4 | 2/2 | 2/2 | 2/2 | 1/1 | [Compliance with Corporate Governance Code](index=48&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company complied with the Corporate Governance Code set out in Appendix 14 of the Listing Rules in 2020, with two deviations: the notice period for regular Board meetings did not fully comply with the 14-day requirement, and the Chairman is not subject to retirement by rotation - The Company has applied and continuously complied with the Corporate Governance Code set out in Appendix 14 of the Listing Rules[253](index=253&type=chunk) - Deviation from Code Provision A.1.3: The notice period for regular Board meetings did not fully comply with the requirement of at least 14 days' notice[253](index=253&type=chunk) - Deviation from Code Provision A.4.2: The Chairman is not subject to retirement by rotation, as the Board believes the Chairman's role provides strong and consistent leadership for more effective long-term strategic planning and execution[254](index=254&type=chunk) [Induction and Training for Directors](index=49&type=section&id=Induction%20and%20Training%20for%20Directors) New Board members receive comprehensive and formal induction to understand the Group's business, responsibilities, and corporate governance code, and all directors confirm participation in continuous professional development to update their knowledge and skills - Each newly appointed director receives a comprehensive and formal induction to ensure proper understanding of the Group's business, director responsibilities, and the Corporate Governance Code[257](index=257&type=chunk) - During the year, all directors confirmed their participation in continuous professional development to develop and update their knowledge and skills[257](index=257&type=chunk) [Dividend Policy](index=49&type=section&id=Dividend%20Policy) The Company's dividend policy stipulates that dividends may be declared and paid to shareholders from time to time, provided the Group is profitable and its normal operations are not affected, with the dividend amount at the Board's sole discretion, considering factors such as the Group's financial position, liquidity, and capital requirements - The Company may from time to time declare and pay dividends to shareholders, provided that the Group is profitable and its normal operations are not affected[258](index=258&type=chunk) - The declaration and amount of dividends are at the Board's sole discretion, considering factors such as the Group's financial position, liquidity, and capital requirements[258](index=258&type=chunk) [Company Secretary](index=49&type=section&id=Company%20Secretary) Mr. Chan Hoi Yin, the Company Secretary, is responsible for ensuring compliance with Board procedures, efficient Board activities, and assisting the Board in fulfilling its obligations to shareholders; Mr. Chan has complied with the Listing Rules, having attended no less than 15 hours of relevant professional training during the year - Mr. Chan Hoi Yin, the Company Secretary, is responsible to the Board for ensuring compliance with Board procedures and the efficient and effective conduct of Board activities[259](index=259&type=chunk) - He is also responsible for ensuring the Board fully assesses relevant legal, regulatory, and corporate governance developments, and facilitates director induction and professional development[259](index=259&type=chunk) - Mr. Chan Hoi Yin has complied with the Listing Rules, having attended no less than **15 hours** of relevant professional training during each financial year[259](index=259&type%3Dchunk) [Risk Management and Internal Control](index=50&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board is responsible for ensuring sound and effective internal control and risk management systems to safeguard shareholders' interests and company assets; the Group has adopted a risk management system covering risk identification, assessment, and management, with external internal control audit functions reporting directly to the Audit Committee to ensure timely resolution of issues - The Board is responsible for ensuring sound and effective internal control and risk management systems to safeguard shareholders' interests and the Company's assets[261](index=261&type=chunk) - The Group has adopted a risk management system, including risk identification, assessment, and management[262](index=262&type=chunk)[263](index=263&type=chunk)[264](index=264&type=chunk) - The internal control audit function is outsourced and reports directly to the Audit Committee, ensuring management addresses any issues arising from the audit in an effective and timely manner[266](index=266&type=chunk) [Standard Code for Securities Transactions by Directors](index=50&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Board has adopted the Model Code for Securities Transactions by Directors of Listed Issuers, as set out in Appendix 10 of the Listing Rules, as its own code of conduct for directors' securities transactions, and all directors confirmed compliance throughout 2020 - The Board has adopted the Model Code for Securities Transactions by Directors of Listed Issuers, as set out in Appendix 10 of the Listing Rules, as its own code of conduct for directors' securities transactions[267](index=267&type=chunk) - All directors confirmed their continuous compliance with the standards stipulated in the Model Code throughout the year ended December 31, 2020[267](index=267&type=chunk) [Accountability and Audit](index=51&type=section&id=Accountability%20and%20Audit) The Board confirms its responsibility for preparing the Group's accounts to ensure they fairly reflect the financial position, with management providing financial information for evaluation, and the Company paid HKD 1 million in total remuneration to auditor Hengjian Certified Public Accountants Limited for audit services in 2020 - The Board confirms its responsibility for preparing the Group's accounts to ensure they present a true and fair view of the Group's affairs[269](index=269&type=chunk) - Management provides explanations and information to the Board to enable informed assessments[270](index=270&type=chunk) Auditor's Remuneration | Indicator | 2020 (HKD thousands) | | :--- | :--- | | Total Remuneration for Audit Services | 1,000 | [Communication with Shareholders](index=51&type=section&id=Communication%20with%20Shareholders) The Company is committed to regularly providing clear, comprehensive, and timely relevant information to shareholders, communicating through its website, annual reports, interim reports, and general meetings, where all voting is conducted by poll to ensure transparency - The Company is committed to regularly communicating clear, comprehensive, and timely relevant information to shareholders, and considers their opinions and suggestions[272](index=272&type=chunk) - The Company communicates with shareholders by publishing annual reports, interim reports, circulars, results announcements, and newspaper advertisements, with all shareholder communications also available on the Company's website[273](index=273&type=chunk) - Annual General Meetings provide a useful platform for shareholders to exchange views with the Board, and all voting must be conducted by poll[274](index=274&type=chunk)[276](index=276&type=chunk) [Communication with Investors](index=52&type=section&id=Communication%20with%20Investors) The Board believes effective communication with investors is crucial for building confidence and attracting new investors; the Group regularly publishes results announcements and company information on its website and the HKEX website, and welcomes public feedback and inquiries - The Board believes that effective communication with investors is key to building investor confidence and attracting new investors[278](index=278&type=chunk) - The Group prepares annual and interim reports within the periods prescribed by the Listing Rules and dispatches them to all shareholders, with all results announcements and reports available on the Company's website and the HKEX website[279](index=279&type=chunk) - The Group regularly publishes company information on its website and welcomes public feedback and inquiries through the website[280](index=280&type=chunk) [Independent Auditor's Report](index=53&type=section&id=Independent%20Auditor's%20Report) This section presents the independent auditor's report, including their opinion on the consolidated financial statements, key audit matters, and the auditor's responsibilities [Opinion and Basis for Opinion](index=53&type=section&id=Opinion%20and%20Basis%20for%20Opinion) Hengjian Certified Public Accountants Limited issued an unmodified opinion on China City Infrastructure Group Limited's 2020 consolidated financial statements, affirming their true and fair presentation of the Group's financial position, performance, and cash flows in accordance with Hong Kong Financial Reporting Standards and proper preparation under the Hong Kong Companies Ordinance - The auditor issued an unmodified opinion on the consolidated financial statements[284](index=284&type=chunk) - The consolidated financial statements present a true and fair view of the Group's consolidated financial position as of December 31, 2020, and its consolidated financial performance and cash flows for the year then ended, in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants[284](index=284&type=chunk) - The auditor conducted the review in accordance with Hong Kong Standards on Auditing and maintained independence in compliance with the Code of Ethics for Professional Accountants[285](index=285&type=chunk) [Key Audit Matters](index=54&type=section&id=Key%20Audit%20Matters) The auditor identified three key audit matters: goodwill impairment assessment, gain on disposal of a subsidiary, and valuation of investment properties, all involving significant management judgment and estimates, which were confirmed as reasonable and appropriate through procedures such as evaluating management assumptions, valuers' qualifications, and sensitivity analysis [Goodwill Impairment Assessment](index=54&type=section&id=Goodwill%20Impairment%20Assessment) Goodwill impairment assessment was a key audit matter due to significant management judgment involved in cash flow forecasts, discount rates, and projected growth; the auditor assessed the reasonableness of management's estimates, the objectivity of the valuer, and performed sensitivity analysis, concluding that key assumptions were reasonable and appropriate - Goodwill impairment was considered a key audit matter because significant management judgment and estimates are required in assessing the input data for the valuation model supporting management's impairment assessment[288](index=288&type=chunk) - The auditor assessed the reasonableness of management's estimates for revenue growth rates and operating profit margins, evaluated the objectivity, independence, and qualifications of the valuer, and performed sensitivity analysis[290](index=290&type=chunk) - The auditor concluded that the key assumptions used by management were comparable between past performance and expected future outlook, and were reasonable and appropriate in the specific circumstances[291](index=291&type=chunk) [Gain on Disposal of a Subsidiary](index=55&type=section&id=Gain%20on%20Disposal%20of%20a%20Subsidiary) The Group's gain of approximately HKD 323.8 million from the disposal of a subsidiary was a key audit matter due to its significance to the consolidated financial statements; the auditor reviewed the sale and purchase agreement and performed a completion audit of the net assets of the disposed subsidiary, concluding that the recorded gain amount and timing were supported by reasonable evidence Gain on Disposal of a Subsidiary | Indicator | 2020 (HKD thousands) | | :--- | :--- | | Gain on Disposal of a Subsidiary | 323,847 | - The auditor reviewed the details contained in the sale and purchase agreement fo