（於中華人民共和國成立的股份有限公司） 股份代號：6189 年報 2021 僅供識別 For identification purpose only (A joint stock company incorporated in the People's Republic of China with limited liability) Stock code: 6189 Annual Report2021 GUANGDONG ADWAY CONSTRUCTION (GROUP) HOLDINGS COMPANY LIMITED Annual Report 2021 年報 目錄 | 公司資料 | 2 | | --- | --- | | 財務摘要 | 3 | | 主席報告 | 4 | | 董事、監事及高級管理層之履歷詳情 | 6 | | 管理層討論與分析 | 10 | | 董事會報告 | 15 | | 監事會報告 | 28 | | 企業管治報告 | 29 | | 環境、社會及管治報告 | 42 | | 獨立核數師報告 | 62 | | 合併資產負債表 | 64 | | 母公司資產負債表 | 67 | | 合併利潤表 ...

Financial Performance - The company's revenue increased by 59.2% from approximately RMB 159.9 million for the six months ended June 30, 2020, to approximately RMB 254.6 million for the six months ended June 30, 2021[16]. - The main business revenue rose by 59.1% from approximately RMB 159.8 million to approximately RMB 254.2 million during the same period, indicating a recovery from the adverse impacts of COVID-19[16]. - The net profit for the six months ended June 30, 2021, was approximately RMB 4.1 million, a turnaround from a net loss of RMB 21.5 million for the same period in 2020, representing 1.6% of recorded revenue[17]. - Total operating revenue for the first half of 2021 reached RMB 254,635,619.10, a significant increase of 59.2% compared to RMB 159,916,692.35 in the same period of 2020[67]. - The company reported a net profit of RMB 4,066,300.06, recovering from a net loss of RMB 21,467,148.13 in the first half of 2020[68]. - Operating profit for the first half of 2021 was RMB 5,975,689.19, compared to an operating loss of RMB 38,214,010.74 in the same period last year[67]. Cost and Expenses - The gross profit increased by 40.2% from approximately RMB 31.1 million to approximately RMB 43.6 million, although the gross profit margin decreased from 19.5% to 17.1% due to intensified competition[16]. - Total operating costs amounted to RMB 249,865,845.47, up 46.5% from RMB 170,453,153.53 year-on-year[67]. - Research and development expenses increased to RMB 9,539,901.34, a rise of 85.5% from RMB 5,147,061.14 in the previous year[67]. - The company experienced a significant reduction in tax expenses, reporting RMB 1,126,577.08 compared to a tax benefit of RMB 11,541,420.99 in the previous year[67]. - The company recorded a decrease in financial expenses to RMB 10.85 million from RMB 14.76 million, indicating improved cost management[70]. Assets and Liabilities - As of June 30, 2021, the company's total assets amounted to RMB 1,959,665,743.46, a decrease from RMB 2,152,753,222.28 at the end of the previous year, representing a decline of approximately 8.97%[56]. - The company's current assets totaled RMB 1,796,016,665.74, down from RMB 1,984,711,060.50, indicating a decrease of about 9.47% year-over-year[56]. - The company's current liabilities were RMB 1,019,789,096.64, a reduction from RMB 1,199,590,684.72, reflecting a decrease of approximately 15.03%[58]. - Total liabilities as of June 30, 2021, were RMB 1,031,246,276.23, down from RMB 1,211,777,299.99, indicating a reduction of about 14.89%[65]. - The debt-to-asset ratio remained stable at 21% as of June 30, 2021, consistent with December 31, 2020[24]. Cash Flow - Cash and cash equivalents decreased from RMB 159.5 million as of December 31, 2020, to RMB 66.1 million as of June 30, 2021, primarily due to fewer bank loans obtained during the period[20]. - Cash flow from operating activities generated a net amount of RMB 21.14 million, a recovery from a negative cash flow of RMB 74.87 million in the same period last year[72]. - Total cash inflow from financing activities was RMB 58,399,875.00, down 77.5% from RMB 259,250,000.00 in the previous year[76]. - Cash outflow for purchasing goods and services was RMB 503,561,047.23, a decrease of 10.5% compared to RMB 562,403,316.66 last year[76]. Shareholder Information - The ownership structure shows that Ye Yujing holds 37.99% of the company's shares, while Ye Xiujin holds 8.70%[39]. - Major shareholders hold approximately 7.06% and 5.22% of the total share capital, with Ningbo Meishan Free Trade Port Zone Yixiang Investment Center (Limited Partnership) owning 12,580,645 shares[41]. - The total number of issued shares is 240,930,645, which is used to calculate the ownership percentages[40]. - The company has a significant concentration of ownership, with several entities holding over 9% of the shares[41]. Corporate Governance - The company maintained good corporate governance practices throughout the reporting period, adhering to all relevant codes except for the separation of the roles of Chairman and CEO[53]. - The audit committee, consisting of three independent non-executive directors, reviewed the unaudited interim results for the six months ended June 30, 2021, with no objections raised regarding the accounting policies adopted[54]. - The financial report has been approved by the company's board of directors, ensuring its credibility and compliance with regulatory requirements[93]. Strategic Initiatives - The company aims to focus on niche markets, particularly in the healthcare and hotel sectors, and plans to establish a business unit for the Greater Bay Area[11]. - The company is committed to optimizing project management processes and enhancing management quality and efficiency through innovation and centralized procurement[13]. - The company plans to strengthen its talent reserve and enhance team cohesion and communication capabilities[14]. Changes in Management - The company has undergone changes in its board of directors, with Mr. Ye Niangting resigning as an executive director effective June 11, 2021[44]. - Mr. Zuli resigned as a supervisor due to personal career development reasons, effective at the conclusion of the annual general meeting[46]. - The company has appointed Mr. Li Rui as a supervisor, effective upon the conclusion of the annual general meeting[47]. Accounting Policies - The company changed its accounting standards from Hong Kong Financial Reporting Standards to Chinese Accounting Standards, effective January 4, 2021[35]. - The accounting policies and estimates comply with the accounting standards issued by the Ministry of Finance, ensuring a true and complete reflection of the company's financial status[98]. - The financial statements are prepared in accordance with significant accounting policies, including adjustments to capital reserves and retained earnings when acquiring minority stakes in subsidiaries[111].

Financial Performance - The company's revenue for 2020 was RMB 910.6 million, a decrease of 41% compared to RMB 1,543.0 million in 2019[7] - The gross profit for 2020 was RMB 151.9 million, with a gross margin of 16.7%, an increase from 16.0% in 2019[7] - The net loss for 2020 was RMB 331.7 million, resulting in a net profit margin of -36.4%[7] - The company's revenue decreased by 41.0% from approximately RMB 1,543.0 million in 2019 to approximately RMB 910.6 million in 2020[49] - The gross profit fell by 38.4% from approximately RMB 246.4 million in 2019 to approximately RMB 151.9 million in 2020, while the gross profit margin increased from 16.0% to 16.7%[49] - The net loss for 2020 was approximately RMB 331.7 million, a significant decline of 816.5% compared to a net profit of approximately RMB 46.3 million in 2019, representing -36.4% of recorded revenue[51] Assets and Liabilities - Non-current assets increased to RMB 168.0 million in 2020 from RMB 111.1 million in 2019[8] - Current assets decreased to RMB 1,984.7 million in 2020 from RMB 2,673.5 million in 2019[8] - Total equity decreased to RMB 950.1 million in 2020 from RMB 1,278.3 million in 2019[8] - As of December 31, 2020, the company had cash and cash equivalents of approximately RMB 159.5 million, down from RMB 266.9 million in 2019[52] - Accounts receivable decreased significantly from RMB 1,234.5 million as of December 31, 2019, to RMB 607.8 million as of December 31, 2020, primarily due to a substantial increase in impairment provisions[53] - Contract assets declined from RMB 1,001.2 million as of December 31, 2019, to RMB 962.5 million as of December 31, 2020, influenced by the timing of customer progress report sign-offs and increased impairment provisions[54] - Accounts payable decreased from RMB 688.4 million as of December 31, 2019, to RMB 512.3 million as of December 31, 2020, due to a decline in operating revenue and procurement costs[56] - Bank borrowings amounted to RMB 364.3 million as of December 31, 2020, down from RMB 401.9 million as of December 31, 2019, with no inter-company loans reported[57] - The debt-to-asset ratio increased to 21% as of December 31, 2020, from 11% as of December 31, 2019, primarily due to a decrease in cash and cash equivalents[58] - Capital expenditures decreased from RMB 0.4 million for the year ended December 31, 2019, to RMB 0.3 million for the year ended December 31, 2020, as the company focused on controlling capital spending[59] Strategic Focus and Future Plans - The company plans to focus on innovation and enhance engineering management in 2021[17] - The company aims to expand its market presence in the Greater Bay Area and new regions[20] - The company will continue to develop its strengths in green medical and smart home technology[20] - The strategic focus will remain on integrating industry, finance, technology, and branding to enhance competitive advantages[20] - The company plans to focus on the healthcare and hotel sectors, establishing a business unit for the Greater Bay Area to enhance competitive positioning[45] - The company aims to optimize project management processes to improve efficiency and leverage centralized procurement for better quality assurance[46] - The company aims to enhance competitiveness by focusing on niche markets, particularly in the healthcare and hotel sectors, and expanding in the Guangdong-Hong Kong-Macao Greater Bay Area[68] - The company plans to optimize project management processes and improve management quality and efficiency through innovation and centralized procurement[69] Corporate Governance and Leadership - The company has a significant leadership team, including the founder and CEO, who has been in the role since April 10, 2012[21] - The company has a diverse board of directors with expertise in finance, construction, and project management[26][27] - The company has a strong emphasis on corporate governance and strategic planning, with key executives providing insights into business strategies[22] - The company has been recognized for its contributions to the construction industry, with awards for outstanding entrepreneurs and project managers[21] - The company has a significant shareholding structure, with key executives holding substantial stakes in the business[24] - The company has established partnerships and collaborations to enhance its investment and operational capabilities in the market[26] - The board consists of five executive directors, one non-executive director, and three independent non-executive directors, ensuring a diverse leadership structure[146] - The board has established four committees: audit, remuneration, nomination, and strategic committees, each with defined responsibilities[152] - The company has fully complied with the corporate governance code, with the exception of the separation of the roles of Chairman and CEO, which are currently held by the same individual[145] Risk Management - Financial risks include interest rate risk, credit risk, and liquidity risk, with management regularly meeting to analyze and formulate measures to manage these risks[83] - The company has implemented risk assessment procedures to ensure the effectiveness of internal controls related to project management and revenue recognition[101] - The supervisory board has confirmed that the company's operations comply with relevant laws and regulations, and the internal control system is comprehensive[142] - The board has confirmed the effectiveness of the internal control and risk management systems, identifying areas for improvement but no significant issues found[177] Employee and Social Responsibility - The group contributed a total of RMB 210,000 to various organizations for COVID-19 relief efforts during the year ending December 31, 2020, compared to RMB 21,000 in 2019[194] - The group has established a safety management system certified by OHSAS 18001, ensuring a safe working environment for employees[193] - The group employs a structured recruitment process through a dedicated recruitment website and partnerships with professional institutions[190] - The group has a union in place to protect employee rights and facilitate management decision-making[190] - The group emphasizes regular training for employees to enhance their skills and technical expertise[190] - As of December 31, 2020, the total number of employees in the group was 335, with 116 in project management and 24 in R&D[190] Shareholder Information - The company has a competitive compensation system for its management team, regularly reviewing and updating it to ensure market competitiveness[99] - The total remuneration for directors, supervisors, and the CEO for the year ended December 31, 2020, amounted to RMB 2,439,000[88] - The total number of issued shares is 240,930,645 as of December 31, 2020[123] - Major shareholders include Ningbo Meishan Free Trade Port Area Yixiang Investment Center holding 12,580,645 shares (7.06% of total shares) and Shenzhen Qianhai Xingwang Investment Management Co., Ltd. holding 22,580,645 shares (12.67% of total shares)[119] - The ownership structure indicates that Shenzhen Qianhai Xingwang Investment Management controls the shares held by Ningbo Yixiang, with significant stakes held by various partners[121] - The company has a diverse shareholder base, with multiple entities holding significant percentages of shares, including 9.54% held by Shenzhen Tongchuang Weiye Asset Management Co., Ltd.[119] Compliance and Audit - The new auditor, Lixin, was appointed on January 4, 2021, following the resignation of PwC, with the change approved by shareholders on March 5, 2021[94] - The auditor, Lixin CPA, has been appointed to audit the consolidated financial statements for the year ending December 31, 2020[139] - The audit committee reviewed the consolidated financial statements for the year ended December 31, 2020, and assessed the effectiveness of internal audit functions[156] - The company has adopted measures to ensure compliance with the non-competition agreement with controlling shareholders, which prohibits them from engaging in direct or indirect competition with the company's main business[136] Environmental Management - The company has implemented an environmental management system and obtained ISO 14001 certification to mitigate adverse environmental impacts[189] - The company is committed to complying with applicable environmental laws and regulations, with no significant compliance costs expected in the future[189] - The report covers the group's performance in fulfilling environmental and social responsibilities from January 1 to December 31, 2020[196] - The group adheres to the ESG reporting guidelines set forth by the Hong Kong Stock Exchange, ensuring transparency and accountability in its operations[197]

Financial Performance - The company's revenue decreased by 78.55% from approximately RMB 744.88 million for the six months ended June 30, 2019, to approximately RMB 159.75 million for the six months ended June 30, 2020[16]. - Gross profit for the six months ended June 30, 2020, was approximately RMB 24.72 million, with a gross margin of 15.48%, an increase of 3.11 percentage points compared to the same period in 2019[16]. - The company reported a net loss of approximately RMB 22.79 million, a decrease of 143.08% compared to a net profit of RMB 52.90 million for the same period in 2019, representing -14.27% of recorded revenue[17]. - The company reported a loss before tax of RMB 34,327 thousand for the six months ended June 30, 2020, compared to a profit of RMB 52,974 thousand for the same period in 2019[81]. - Basic and diluted loss per share was RMB 9.46, compared to earnings of RMB 23.93 per share in the prior year[46]. - For the six months ended June 30, 2020, the company reported a loss attributable to owners of RMB 22,786,000 compared to a profit of RMB 52,896,000 for the same period in 2019, representing a decrease of 143%[83]. Operational Highlights - The company signed 61 new contracts valued over RMB 1 million and 6 contracts valued over RMB 10 million during the first half of 2020, with a total contract value of approximately RMB 2.6 billion[10]. - The company operates 21 branches and offices across 15 provinces, autonomous regions, and municipalities in China as of June 30, 2020[9]. - The company aims to focus on the healthcare and hotel sectors, establishing a business unit for the Greater Bay Area to enhance its competitive position[11]. - The company plans to optimize project management processes to improve efficiency and leverage centralized procurement to enhance scale benefits[12]. Cash Flow and Liquidity - The company's cash and cash equivalents decreased from approximately RMB 254.6 million as of December 31, 2019, to RMB 71.5 million as of June 30, 2020[18]. - Operating cash flow for the six months ended June 30, 2020, was a net outflow of RMB 72,776,000, compared to RMB 59,993,000 for the same period in 2019, representing an increase of 21.5% in cash used[51]. - Cash and cash equivalents decreased by RMB 183,098,000 during the six months ended June 30, 2020, compared to a decrease of RMB 68,397,000 in the same period of 2019, indicating a significant decline in liquidity[51]. - The company has maintained a liquidity policy to monitor current and expected liquidity requirements, ensuring sufficient cash reserves and committed funding from banks[70]. Shareholder Information - As of June 30, 2020, major shareholders and other individuals hold a total of 240,930,645 shares after the issuance of 19,880,645 new domestic shares[31]. - The ownership structure includes various partnerships and investment management companies, reflecting a complex investment landscape[32]. - Major shareholders include Huang Li and Ding Baoyu, each holding 17,000,000 shares, representing 9.54% of the total shares[34]. - The company has a diverse shareholder base, with multiple entities holding substantial stakes[32]. Corporate Governance - The company maintained good corporate governance practices and processes throughout the reporting period[41]. - The board believes that the current arrangement of having the same person serve as both chairman and CEO is beneficial for internal leadership consistency[42]. - The company confirmed that all directors and supervisors complied with the standard code of conduct regarding securities trading during the reporting period[40]. Challenges and Risks - The company faced significant adverse impacts on its construction decoration business due to the COVID-19 outbreak, leading to delays in project completion and payment processes[62]. - The company currently has no foreign exchange risk hedging policies in place, and expects that fluctuations in the RMB exchange rate will not have a significant impact on its operations or financial performance[29]. - The company continues to monitor credit risks associated with cash and cash equivalents, trade receivables, and contract assets, ensuring robust credit policies are in place[65]. Awards and Recognition - The company received the "Hainan Construction Engineering Decoration Award" and the "泉城杯" award in Jinan for its outstanding performance in brand building and business development during the first half of 2020[8].

Financial Performance - In 2019, the company's revenue was RMB 1,542.8 million, a decrease of 15.7% compared to RMB 1,830.8 million in 2018[5] - The gross profit for 2019 was RMB 207.9 million, with a gross margin of 13.5%, slightly down from 13.8% in 2018[5] - Net profit for the year was RMB 70.3 million, resulting in a net profit margin of 4.6%, down from 7.1% in the previous year[5] - The company's revenue decreased by 15.7% from approximately RMB 1,830.8 million in 2018 to approximately RMB 1,542.8 million in 2019[43] - Gross profit fell by 17.9% from approximately RMB 253.1 million in 2018 to approximately RMB 207.9 million in 2019, with a gross margin decline from 13.8% to 13.5%[43] - Net profit decreased by 46.2% from approximately RMB 130.7 million in 2018 to approximately RMB 70.3 million in 2019, resulting in a net profit margin of 4.6% compared to 7.1% in 2018[44] Project and Contract Management - The company signed 327 new contracts valued over RMB 1 million, 39 contracts over RMB 10 million, and 8 contracts over RMB 50 million in 2019[41] - The total contract value for projects undertaken in 2019 was approximately RMB 4.8 billion, including 97 projects valued over RMB 10 million and 13 projects over RMB 50 million[41] - The company optimized its project types, with smart medical decoration becoming a new growth driver, leading to numerous hospital project acquisitions[11] - The company continued to pursue high-quality engineering projects, with several major projects recognized for national quality engineering awards[12] Assets and Liabilities - The total assets as of December 31, 2019, were RMB 2,784.5 million, with total equity amounting to RMB 1,278.3 million[6] - Trade receivables increased significantly from approximately RMB 589.1 million in 2018 to approximately RMB 1,255.0 million in 2019[46] - Cash and cash equivalents rose from approximately RMB 180.1 million in 2018 to approximately RMB 254.6 million in 2019, primarily due to significant operating cash inflows[45] - Trade and other payables increased from approximately RMB 904.0 million in 2018 to approximately RMB 956.4 million in 2019[47] - As of December 31, 2019, the company's interest-bearing bank borrowings amounted to approximately RMB 417.2 million, a decrease from RMB 496.0 million as of December 31, 2018[49] - The capital-to-debt ratio decreased to 11% as of December 31, 2019, compared to 23% as of December 31, 2018, primarily due to an increase in cash and cash equivalents and a reduction in bank borrowings[50] Strategic Focus and Development - The company plans to focus on innovation and engineering management as key themes for development in 2020[16] - The company aims to leverage opportunities from the Guangdong-Hong Kong-Macao Greater Bay Area and the pilot demonstration zone for integrated infrastructure construction[17] - The company aims to fully advance its performance expansion and engineering management improvement, consolidating its market in the Greater Bay Area and exploring new regional markets[19] - The company is focused on developing its brand-advantaged businesses in the medical, electromechanical, and curtain wall segments[19] - The company plans to optimize engineering management processes and enhance service levels to ensure project quality and strengthen cost management[19] - The company will continue to explore new developments in green medical, green materials research and development, and smart home technology, leveraging its mature technical and brand resources[19] Corporate Governance - The company is focused on enhancing its corporate governance through the appointment of experienced independent directors and supervisors[30][31] - The board's composition reflects a commitment to independent oversight and strategic decision-making, crucial for long-term growth[30][33] - The company has a diverse board with members holding qualifications such as CPA and CFA, enhancing its financial oversight capabilities[29][30] - The management team includes several vice presidents with extensive backgrounds in finance and operations, ensuring strategic leadership[34][35][36] - The company has established a non-competition agreement with its controlling shareholder, ensuring no direct or indirect competition in its main business areas, including design, measurement, consulting, and civil protection product manufacturing[127] Shareholder Structure - As of December 31, 2019, the company's total issued share capital was 240,930,645 shares, with domestic shares accounting for 73.9% and H-shares for 26.1%[90] - Major shareholders hold approximately 7.06% and 5.61% of the company's total equity through Ningbo Meishan Free Trade Port Area Yanxiang Investment Center and Ningbo Meishan Free Trade Port Area Xingwang Yinghua Equity Investment Center, respectively[109] - Shenzhen Qianhai Xingwang Investment Management holds 12.67% of the company's equity, indicating significant control over the company's shares[109] - The total number of shares issued after the new issuance is 240,930,645, with 19,880,645 new domestic shares added[108] - The company has a diverse shareholder structure, with multiple entities holding significant stakes, including 22,580,645 shares held by Shenzhen Qianhai Xingwang Investment Center[109] Compliance and Risk Management - The supervisory board has confirmed that the company's operations comply with Chinese company law and relevant regulations, and the internal control system is comprehensive[134] - The company has established an environmental management system and obtained ISO 14001 certification to mitigate adverse environmental impacts[182] - The company has a strict internal policy prohibiting unauthorized use of insider information, communicated to all employees[171] - The company has identified areas for improvement in its internal control and risk management systems[171] Social Responsibility and Employee Engagement - The group emphasizes sustainable development and has committed to environmental and social responsibilities, aligning with national strategic directions[192] - The group actively participates in social welfare activities, including providing free construction design for public projects[187] - The group has established a union to protect employee rights and encourage participation in management decisions[185] - The group conducted an annual materiality assessment to understand stakeholder expectations regarding sustainable development performance[200]

Financial Performance - For the six months ended June 30, 2019, the company recorded revenue of RMB 744.88 million, a slight increase from RMB 735.30 million for the same period in 2018[15]. - The net profit attributable to equity holders for the same period was RMB 52.90 million, compared to RMB 51.39 million in 2018, representing a growth of 2.94%[15]. - The gross profit for the six months was RMB 92.15 million, with a gross margin of approximately 12.37%, down from 13.84% in 2018, indicating a decrease of 1.47 percentage points[15]. - The operating profit for the six months was RMB 67.62 million, representing 9.08% of recorded revenue, a decrease of 8.31% compared to the previous year[15]. - The earnings per share for the six months was RMB 0.2393, a decrease of 1.72% from RMB 0.2435 in 2018[16]. - Total revenue for the six months ended June 30, 2019, was RMB 744,876,000, a slight increase from RMB 735,304,000 in 2018, representing a growth of approximately 1.6%[55]. - Gross profit for the same period was RMB 92,148,000, down from RMB 101,791,000 in 2018, indicating a decrease of about 9.4%[55]. - Operating profit decreased to RMB 67,621,000 from RMB 73,751,000, reflecting a decline of approximately 8.3%[55]. - Net profit for the period was RMB 52,896,000, compared to RMB 51,387,000 in 2018, showing a growth of about 2.9%[55]. - Basic and diluted earnings per share were RMB 0.2393, slightly down from RMB 0.2435 in the previous year, a decrease of approximately 0.9%[55]. Contracts and Projects - The company signed 92 new contracts valued over RMB 1 million, 17 contracts over RMB 10 million, and 5 contracts over RMB 50 million during the first half of 2019[9]. - As of June 30, 2019, the total contract value of ongoing projects was approximately RMB 3.5 billion, including 80 projects valued over RMB 10 million and 11 projects over RMB 50 million[9]. - Revenue from construction contracts for the six months ended June 30, 2019, was RMB 719,462 thousand, an increase from RMB 689,052 thousand in the same period of 2018, representing a growth of approximately 4.1%[91]. Financial Position - As of June 30, 2019, the company's cash and cash equivalents decreased from approximately RMB 180.06 million to RMB 111.65 million, primarily due to an increase in prepaid supplier payments and trade receivables[17]. - Trade and other payables increased by 11.23% from approximately RMB 903.98 million as of December 31, 2018, to approximately RMB 1,005.48 million as of June 30, 2019[18]. - As of June 30, 2019, the company's interest-bearing bank loans and other borrowings amounted to approximately RMB 440.60 million, down from approximately RMB 496.02 million as of December 31, 2018[20]. - The company's debt-to-asset ratio remained stable at 22.43% as of June 30, 2019, compared to 22.56% as of December 31, 2018[21]. - Total assets as of June 30, 2019, were RMB 2,703,144,000, an increase from RMB 2,611,443,000 at the end of 2018, representing a growth of about 3.5%[57]. - Total liabilities increased to RMB 1,565,518,000 from RMB 1,526,713,000, indicating a rise of approximately 2.5%[57]. - Cash and cash equivalents decreased to RMB 111,652,000 from RMB 180,059,000, a decline of about 38.1%[57]. - Total borrowings decreased to RMB 440,601,000 as of June 30, 2019, from RMB 496,021,000 as of December 31, 2018[106]. - Trade receivables increased significantly to RMB 913,585,000 as of June 30, 2019, compared to RMB 624,025,000 as of December 31, 2018[101]. - The net value of trade receivables after impairment provisions was RMB 851,544,000 as of June 30, 2019[101]. Corporate Governance - The board consists of five executive directors, one non-executive director, and three independent non-executive directors, maintaining high corporate governance standards[41]. - The audit committee, comprising three independent non-executive directors, reviewed the unaudited interim financial information for the six months ended June 30, 2019[46]. - The company has fully complied with the corporate governance code since its listing, with a review of the separation of the roles of chairman and CEO ongoing[41]. - There were changes in the board of directors, including the resignation of Mr. Ye Xian as a supervisor and the appointment of Ms. Li Yuanfei as a non-executive director[42][43]. - The company has not established any arrangements for directors or supervisors to profit from purchasing shares or debt securities[45]. - The unaudited consolidated interim results for the reporting period have been reviewed by external auditors[47]. Shareholder Information - As of June 30, 2019, the total number of shares issued by the company is 221,050,000[34]. - Mr. Ye Yujing holds 67,694,000 shares, representing 42.77% of the company's relevant shares and 30.62% of the total share capital[33]. - Major shareholders include Nanhai Growth Selected (Tianjin) Equity Investment Fund Partnership, holding 17,000,000 shares, which is 10.74% of the relevant shares[35]. - International South China Investment Fund Limited holds 16,009,000 H shares, representing 25.51% of the relevant shares[35]. - Ms. Li Yuanfei holds 10,000,000 shares, which is 6.32% of the relevant shares[35]. - Mr. Ye Guofeng holds 6,075,000 shares, representing 3.84% of the company's relevant shares[33]. - The company has a total of 10,336,000 shares held by Mr. Ye Bingquan, which is 6.53% of the relevant shares[35]. Research and Development - The company allocated approximately RMB 68.78 million for establishing an internal online supply chain management platform and RMB 20.46 million to enhance R&D capabilities[27]. - The company has reported a significant increase in R&D expenses eligible for tax deductions, with 75% of R&D expenditures being deductible for the six months ended June 30, 2019[95]. Risk Management - The company maintains a liquidity risk management policy to ensure sufficient cash reserves and committed funding from banks to meet short-term and long-term liquidity requirements[86]. - The company has implemented credit policies and continuously monitors credit risks associated with cash and cash equivalents, trade receivables, and other receivables[82]. - The company has not changed its risk management policies since the end of the previous year[81]. Future Outlook - The company aims to focus on the healthcare and hotel sectors, establishing a business unit for the Greater Bay Area to enhance its competitive position[10]. - The company is considering further strategies for market expansion and product development in the future[50].

Financial Performance - In 2018, the company achieved revenue of RMB 1,830.8 million, representing a 9.4% increase compared to RMB 1,672.8 million in 2017[9]. - The gross profit for 2018 was RMB 253.1 million, with a gross margin of 13.8%, up from 13.4% in 2017[5]. - The net profit for the year was RMB 130.7 million, resulting in a net profit margin of 7.1%, compared to 6.9% in the previous year[5]. - The group's revenue increased by 9.4% from approximately RMB 1,672.8 million in 2017 to approximately RMB 1,830.8 million in 2018, driven by a rise in high-value contracts[42]. - The gross profit rose by 12.9% from approximately RMB 224.2 million in 2017 to approximately RMB 253.1 million in 2018, with the gross profit margin increasing from 13.4% to 13.8%[42]. - Net profit increased by 12.9% from approximately RMB 115.8 million in 2017 to approximately RMB 130.7 million in 2018, with stable net profit margins of 7.1% and 6.9% respectively[48]. Assets and Liabilities - The total assets as of December 31, 2018, amounted to RMB 2,611.5 million, with total equity of RMB 1,084.7 million[6]. - Trade receivables grew from approximately RMB 357.2 million in 2017 to approximately RMB 589.1 million in 2018, due to the final settlement of several large projects[51]. - Contract assets increased from approximately RMB 1,255.3 million in 2017 to approximately RMB 1,581.8 million in 2018, reflecting the commencement of several high-value projects[51]. - Trade and other payables rose from approximately RMB 438.5 million in 2017 to approximately RMB 904.0 million in 2018, driven by an increase in trade payables as management sought longer settlement periods with suppliers[52]. - As of December 31, 2018, the debt-to-equity ratio decreased to 23% from 33% in 2017, primarily due to a reduction in bank borrowings[54]. Market Strategy and Development - The company plans to strengthen its market presence in first-tier cities and actively participate in the development of the Guangdong-Hong Kong-Macao Greater Bay Area[16]. - The company aims to enhance its management systems and establish mechanisms for goals, incentives, and competition to promote healthy business growth[11]. - The company is focused on expanding its brand influence by delivering high-quality projects and leveraging technology to improve decoration quality[12]. - The company is actively expanding its market presence and exploring new business strategies to drive growth[36]. - The company plans to focus on the healthcare and hotel sectors, enhancing its competitive edge in these niche markets[65]. Governance and Management - The company has a strong focus on strategic development and corporate governance, with significant contributions from its founding members, including Ye Yujing and Ye Xiujin[21]. - The executive team includes key members with extensive backgrounds in finance and management, such as Liu Yilun, who has a master's degree in economics and has held various managerial positions since joining in 2015[20]. - The company has a diverse board with members holding advanced degrees in economics and business management, supporting informed decision-making[29]. - The board of directors consists of five executive directors, one non-executive director, and three independent non-executive directors, ensuring a diverse leadership structure[132]. - The company has adopted corporate governance practices in line with the corporate governance code, ensuring transparency and protection of shareholder rights[125]. Risk Management - The company acknowledges that demand for its services is cyclical and closely tied to real estate development and construction activities in China[75]. - The company faced significant risks related to national or local policies affecting the Chinese real estate and construction industries, including regulations aimed at cooling the real estate market and controlling housing prices[76]. - The company regularly assesses key operational risks to implement appropriate risk response measures[78]. - The company has committed to risk management and operational oversight, as highlighted by Liu Yilun's role in supervising these areas[20]. Corporate Social Responsibility - The company is committed to sustainable development, balancing economic growth with environmental and social benefits[182]. - The company has established an environmental management system and obtained ISO 14001 certification to mitigate adverse environmental impacts[172]. - The company actively participates in social responsibility initiatives, including charitable activities and promoting social progress[188]. - The company donated approximately RMB 10,000 to a poverty alleviation project and RMB 30,000 to the Shenzhen Education Equipment Association during the fiscal year ending December 31, 2018[176]. Employee and Talent Development - The company is committed to talent development, aiming to build a team of industry elites to drive its strategic goals[13]. - The company is focused on improving employee welfare and rights protection, including health and safety measures[197]. - The company has established a union to protect employee rights and encourage participation in management decisions[174]. - The management team has a combined experience of over 20 years in finance and accounting, contributing to robust financial management practices[36]. Shareholder Information - The company has a notable shareholding structure, with Ye Niangting holding 8.3951% of shares as of December 31, 2018[24]. - Revenue from the largest customer accounted for approximately 7.7% of total revenue, down from 17.2% in the previous year, while revenue from the top five customers accounted for 18.0%, down from 30.6%[99]. - The company has established a dividend policy that considers financial status, future market prospects, and funding needs before declaring dividends[89]. - The company did not recommend the distribution of a final dividend for the year ended December 31, 2018[88].