Financial Performance - The company recorded revenue of approximately HKD 176,835,000 for the year, a decrease of about 23.4% compared to the previous year[9]. - The net loss for the year was approximately HKD 102,327,000, which represents a narrowing of the loss by about 58% compared to the previous year[9]. - The total revenue for the year ended December 31, 2021, was approximately HKD 176,835,000, a decrease of about 23.4% compared to HKD 230,862,000 for the year ended December 31, 2020[27][28]. - The gross profit for the year was approximately HKD 31,240,000, resulting in a gross margin of 17.7%, compared to a gross profit of HKD 46,134,000 and a gross margin of 20.0% in the previous year[29]. - The impairment loss on trade receivables and notes was approximately HKD 38,943,000, while the impairment loss on contract assets was approximately HKD 20,796,000 for the year[28]. - The total signed contracts value as of December 31, 2021, was approximately HKD 158,578,000, down from HKD 211,219,000 in the previous year[35]. - The administrative expenses decreased by approximately 20.8% to HKD 70,952,000 from HKD 89,639,000 in the previous year, due to cost control measures[31]. - The company has cash and cash equivalents of approximately HKD 87,069,000 as of December 31, 2021, compared to HKD 63,172,000 in the previous year[41]. - The debt ratio as of December 31, 2021, was approximately 51.2%, down from 57.5% in the previous year[46]. Strategic Focus and Future Plans - The company aims to focus on urban ecological governance and participate in urban heating and cooling construction, emphasizing clean energy support[18]. - The company has set a goal for 2022 to "restart and take off again" based on previous foundations[12]. - Future plans include expanding business in northern rural areas for clean heating solutions, targeting buildings with an area of 50-2,000 square meters[62]. - The company aims to promote clean heating projects in the Beijing-Tianjin-Hebei region and increase market efforts in western regions[62]. - The company is committed to leveraging its unique shallow geothermal heating technology to create higher value for shareholders, employees, and customers[18]. - The company continues to focus on promoting shallow geothermal energy as an alternative energy source and is actively seeking opportunities for market expansion[39]. - The company plans to implement a unified basic salary standard and refine performance assessments to maximize fairness and justice[13]. Management and Governance - The company appointed Mr. Xue Jiangyun as the executive director and CEO since March 14, 2022, with extensive experience in energy efficiency and management[66]. - Mr. Pan Ya has been appointed as the executive director and CFO since March 14, 2022, bringing over 20 years of financial accounting and management experience[67]. - The board of directors includes experienced professionals with backgrounds in finance, engineering, and management, enhancing strategic decision-making capabilities[69]. - The company has established systems and allocated resources to ensure compliance with regulatory requirements, including the Securities and Futures Ordinance and GEM Listing Rules[107]. - The company has adopted a nomination policy to identify suitable candidates for the board, considering various factors including qualifications, skills, and diversity[175]. - The company established a remuneration committee in May 2006 to review and formulate the remuneration policy for directors and senior management, holding three meetings during the reporting period[170]. Risk Management - The company has identified major risks related to market, operations, and funding, and has developed corresponding countermeasures[193]. - Market risks include the impact of macroeconomic conditions on the mainland real estate market, potentially leading to a decrease in new property completions and affecting project promotions[193]. - Intense market competition has resulted in a significant decline in annual revenue due to reduced project availability[194]. - Operational risks include insufficient awareness of costs and budgets within business departments, leading to discrepancies between actual performance and budget[196]. - Funding risks include increasing difficulty in collecting payments for past projects, leading to higher bad debt risks and significant capital occupation[199]. - The ongoing COVID-19 pandemic continues to impact the company's normal operations[197]. Employee and Customer Relations - The company continues to prioritize employee welfare by regularly reviewing and updating compensation and benefits, training, and occupational health policies[108]. - The company has implemented a 24-hour service hotline to address customer inquiries and complaints, demonstrating a commitment to customer service[108]. - The company has not reported any workplace accidents leading to strikes or fatalities during the year, emphasizing a commitment to employee safety[108]. - The top five customers accounted for approximately 39% of total sales during the reporting period, down from 43% in 2020, with the largest customer representing about 16% of sales[109]. - Procurement from the top five suppliers constituted around 30% of total procurement for the year, a decrease from 34% in 2020, with the largest supplier accounting for approximately 16% of procurement, down from 24%[109]. Environmental and Social Responsibility - The company is committed to environmental sustainability by implementing geothermal heating systems in its offices to reduce electricity consumption and environmental impact[105]. - The company plans to continue reviewing its environmental practices and consider implementing more sustainable measures in its operations[106]. - The company will publish its Environmental, Social, and Governance report by May 2022[151]. - The company made charitable donations amounting to RMB 13,000 (approximately HKD 15,677) during the year[101]. Shareholder Information - The company did not recommend the payment of a final dividend for the year ending December 31, 2021[50]. - The company has no available distributable reserves as of December 31, 2021, after deducting accumulated losses, compared to HKD 2,744,000 in 2020[104]. - The company's authorized share capital is USD 160,000,000, divided into 16,000,000,000 shares with a par value of USD 0.01 each, and issued share capital is 4,526,925,163 shares[97]. - Major shareholder China Energy Conservation Group holds 1,190,000,000 shares, representing 26.29% of total issued shares[130]. - The company has not authorized any directors or their associates to acquire shares or bonds during the year[127].

Financial Performance - For the nine months ended September 30, 2021, the revenue was approximately HKD 138,565,000, a decrease of about HKD 59,921,000 compared to HKD 198,486,000 in the same period last year[11]. - The net loss for the nine months ended September 30, 2021, was approximately HKD 45,418,000, significantly widening from a loss of HKD 10,798,000 in the same period last year[13]. - The gross profit margin decreased by 7.34% to 21.16% for the nine months ended September 30, 2021, compared to 28.50% in the same period last year[11]. - The gross profit for the nine months ended September 30, 2021, was HKD 29,316,000, compared to HKD 56,569,000 in the same period of 2020, indicating a decrease of about 48.2%[20]. - The net loss for the nine months ended September 30, 2021, was HKD 45,418,000, compared to a net loss of HKD 10,798,000 in the same period of 2020, reflecting an increase in loss of approximately 320.5%[20]. - Total revenue for the three months ended September 30, 2021, was HKD 50,119,000, a decrease of 38% compared to HKD 80,856,000 in 2020[29]. - Revenue from contracts with customers amounted to HKD 47,342,000 for the three months ended September 30, 2021, down 39% from HKD 77,589,000 in the same period last year[31]. - The total revenue for the nine months ended September 30, 2021, was HKD 138,565,000, representing a decline of 30% from HKD 198,486,000 in 2020[31]. Expenses and Costs - Sales and distribution expenses increased to approximately HKD 15,912,000, up from HKD 13,608,000 in the same period last year, due to market expansion efforts[12]. - The company reported a decrease in sales and distribution expenses to HKD 15,912,000 for the nine months ended September 30, 2021, down from HKD 66,273,000 in the same period of 2020, a reduction of about 76.0%[20]. - Other income decreased from approximately HKD 24,357,000 in the previous year to about HKD 11,710,000 due to the absence of debt waivers this year[11]. - Financing costs decreased to approximately HKD 3,305,000 from HKD 22,534,000 in the previous year, primarily due to loan repayments[13]. - The financing costs for the three months ended September 30, 2021, totaled HKD 1,438,000, a decrease from HKD 12,197,000 in the same period last year[36]. - The cost of goods sold for the three months ended September 30, 2021, was HKD 18,507,000, down from HKD 35,911,000 in 2020[37]. Strategic Initiatives - The company is actively developing projects in regions such as Shanxi and Xinjiang, focusing on coal-to-electricity initiatives[16]. - A significant project in Changsha, Hunan, has been signed with an investment of HKD 8,200,000, which is expected to provide operational guarantees for future heating services[16]. - The company has been actively improving its procurement processes and supplier management to reduce procurement costs, which is part of its cost control strategy[18]. - The company is responding to national policies promoting low-carbon and environmentally friendly industries by implementing sustainable development strategies in geothermal heating[18]. - The group has optimized its human resources structure to further reduce labor costs in line with its development status[18]. - The company aims to enhance its supplier evaluation and maintenance processes through market research and on-site inspections to ensure product quality and service timeliness[18]. Shareholder Information - The largest shareholder, China Energy Conservation and Environmental Protection (Hong Kong) Investment Co., Ltd., held 1,190,000,000 shares, representing 26.29% of the total issued shares[55]. - Xu Shengheng, a director, held 715,646,600 shares, accounting for 15.83% of the total issued shares[55]. - Liu Ening, another director, owned 250,000,000 shares, which is 5.52% of the total issued shares[55]. - The company reported no other significant changes in shareholdings among directors and key executives as of September 30, 2021[56]. - The company continues to monitor its financial performance and shareholder structure closely in light of market conditions[56]. - The weighted average number of ordinary shares in issue for the three months ended September 30, 2021, was 4,447,637,000 shares, slightly down from 4,455,420,000 shares in the same period of 2020[45]. - The weighted average number of ordinary shares for the nine months ended September 30, 2021, was 4,433,055,000 shares, compared to 4,455,420,000 shares for the same period in 2020[45]. - As of September 30, 2021, the company had a total of 4,526,925,163 shares issued[52]. Governance and Compliance - The company has established an audit committee to oversee financial reporting, risk management, and internal control systems, consisting of five independent non-executive directors[62]. - There were no securities transactions by directors that violated the GEM listing rules during the review period[63]. - The company did not repurchase or redeem any of its listed securities during the review period, except for the shares acquired under the share incentive plan[65]. - The company reported no competition or conflict of interest from its directors or major shareholders during the review period[61]. - The board of directors includes both executive and independent non-executive members, ensuring a diverse governance structure[65]. Incentive Plans - The company implemented a share incentive plan on January 15, 2020, to reward qualified participants contributing to its growth and development[58]. - As of September 30, 2021, a total of 46,808,000 shares were purchased under the share incentive plan, representing approximately 1.03% of the company's issued share capital, at a cost of about HKD 3,791,000[65]. - The share incentive plan included rewards for various directors, with a total of 58,000,000 shares allocated, of which 54,000,000 shares remained outstanding as of the reporting date[59]. - The company aims to attract suitable talent for further development through its share incentive plan[58].

中國地熱能產業發展集團有限公司 CHINA GEOTHERMAL INDUSTRY DEVELOPMENT GROUP LIMITED (於阿曼群島註冊成立之有限公司) 股份代號: 8128 科 技 與 資 源 結 合 中期業績報告2021 == ON EN ER ER ER ER ER ER BE 00 00 00 00 00 00 00 000 AND BOOK ON BOX ON BOX BO BOO (0) 000 00 000 00 00 00 000 END BEN BE BER OR BIN BE BEE ON OR OR DR DR OR DR DRE INNE BAN ON BAR OR BOR ON BOOK t ford on bod on bod on box 00 00 00 00 00 00 00 00 ON ON OR OR OR ON OR ORD 中國地熱能產業發展集團有限公司 二零二一年中期報告 GEM的定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他在聯交 所上市的公司帶有較高投資風險。有意投資的人士應了解投資於該等公司的潛在風 險，並應經過審慎周詳的考慮後方作 ...

中國地熱能產業發展集團有限公司 CHINA GEOTHERMAL INDUSTRY DEVELOPMENT GROUP LIMITED (於開曼群島註冊成立之有限公司) 股份代號: 8128 材 技 與 資 源 結 合 第一季度業績報告2021 0 0 BREEBE == BREEBE 000000 and on ford no bod an bod non ANNE ON BOX ON BOX ON BOX AND to on box no box no bod an OHIO DE BE EN BE BE EN BEE 000 00 000 00 00 00 00 000 000 00 000 00 00 00 00 000 BOOK ON ON ON ON ON BOOK OF 000 00 00 00 00 00 000 000 00 000 00 00 00 00 0000 中國地熱能產業發展集團有限公司 二零二一年第一季度業績報告 GEM的定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他在聯交 所上市的公司帶有較高投資風險。有意投資的人士應了解投資於該等公司的潛在風 險，並應經過審慎周詳 ...

China Geothermal Industry Development Group Limited (Incorporated in the Cayman Islands with limited liability) TECHNOLOGY AND RESOURCES LINKS Annual Report 2020 中國地熱能產業發展集團有限公司 Annual Report 2020 年報 Stock Code: 8128 (於開曼群島註冊成立之有限公司) 股份代號: 8128 科 技 與 資 源 結 合 年 報 2020 BHE . DEE END BOX BOX BOX BOX BOX BOOM ������������ 000 000 000 00 00 00 000 ■ ■ BOO BE BE BE BE BE BE BEE BOOK BEE BEE BEE BEE BEE ENR DR DR DIE DIE DIE DIE DOO cour for for for form and for for for BOOK ON BOX BEE BEE BEE BOO ON ON ON ON ON O ...

(於開曼群島註冊成立之有限公司) 股份代號: 8128 中國地熱能產業發展集團有限公司 二零二零年第三季度業績報告 GEM的定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他在聯交 所上市的公司帶有較高投資風險。有意投資的人士應了解投資於該等公司的潛在風 險，並應經過審慎周詳的考慮後方作出投資決定。 由於GEM上市公司普遍為中小型公司，在GEM買賣的證券可能會較於主板買賣之 證券承受較大的市場波動風險，同時無法保證在GEM買賣的證券會有高流通量的市 場。 香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整 性亦不發表任何聲明，並明確表示概不就本報告全部或任何部份內容而產生或因倚 賴該等內容而引致之任何損失承擔任何責任。 1 香港聯合交易所有限公司（「聯交所」）GEM之特色 本報告乃遵照聯交所GEM證券上市規則（「GEM上市規則」）而刊載，旨在提供有關 中國地熱能產業發展集團有限公司（「本公司」）之資料；本公司之董事願就本報告共 同及個別地承擔全部責任。各董事在作出一切合理查詢後，確認就其所知及所信， 本報告所載資料在各重要方面均屬準確完備，沒有誤導或欺詐成分，且並無遺漏其 他事項 ...

Financial Performance - For the six months ended June 30, 2020, the revenue was approximately HKD 117,630,000, an increase of about 14% compared to HKD 103,468,000 for the same period last year[4][8]. - The net profit for the period was approximately HKD 14,860,000, a significant recovery from a loss of HKD 67,409,000 in the same period last year[4][10]. - The gross profit margin improved from approximately 20% in the previous year to about 37% in the current period due to enhanced cost control measures[8]. - The group's revenue for the second quarter of 2020 increased by approximately 14% compared to the same period in 2019, reaching HKD 72,690,000[20]. - The gross profit for the first half of 2020 was HKD 43,140,000, compared to HKD 20,762,000 in the same period of 2019, reflecting a significant increase[24]. - The net profit for the second quarter of 2020 was HKD 33,657,000, a recovery from a loss of HKD 47,860,000 in the same quarter of 2019[26]. - The group reported a total comprehensive income of HKD 14,860,000 for the first half of 2020, compared to a loss of HKD 67,409,000 in the same period of 2019[28]. - The profit attributable to equity holders of the parent company for the six months ended June 30, 2020, was HKD 43,272,000, a significant improvement from a loss of HKD 56,360,000 in 2019[30]. - The group’s adjusted profit before tax for the first half of 2020 was HKD 16,703,000, compared to a loss of HKD 32,374,000 in the same period of 2019[56]. - The company reported a pre-tax profit of HKD 24,898,000 for the six months ended June 30, 2020, compared to HKD 12,847,000 for the same period in 2019[81]. Revenue Segments - The shallow geothermal energy segment generated revenue of HKD 91,776,000 for the six months ended June 30, 2020, compared to HKD 82,742,000 for the same period in 2019, representing an increase of approximately 10.4%[56]. - The air energy/shallow geothermal heat pump segment reported revenue of HKD 25,649,000 for the six months ended June 30, 2020, compared to HKD 19,619,000 in 2019, marking an increase of about 30.5%[56]. - The property investment and development segment's revenue was HKD 14,418,000 for the first half of 2020, compared to HKD 7,428,000 in the same period of 2019, indicating an increase of approximately 93.5%[56]. - Contract revenue from customers for the six months ended June 30, 2020, was HKD 110,202,000, up 13.4% from HKD 97,160,000 in the same period of 2019[64]. - Total rental income for the six months ended June 30, 2020, was HKD 7,428,000, an increase of 17.7% compared to HKD 6,308,000 for the same period in 2019[64]. Financial Position - As of June 30, 2020, the group had a total contract value of approximately HKD 492,000,000[11]. - The fair value of investment properties was assessed at approximately HKD 671,036,000, with a fair value increase of about HKD 6,212,000 during the period[12]. - The group's net current liabilities were approximately HKD 379,936,000, a decrease from HKD 624,790,000 as of December 31, 2019[13]. - The debt ratio increased to 61% as of June 30, 2020, compared to 59% at the end of 2019[15]. - Non-current assets decreased to HKD 1,120,766,000 as of June 30, 2020, down from HKD 1,380,996,000 at the end of 2019[32]. - Current liabilities increased to HKD 1,225,251,000 as of June 30, 2020, compared to HKD 1,199,462,000 at the end of 2019[34]. - The net asset value as of June 30, 2020, was HKD 655,202,000, slightly down from HKD 664,105,000 at the end of 2019[36]. - The total liabilities as of June 30, 2020, were HKD 1,310,879,000, compared to HKD 1,291,563,000 at the end of 2019[34]. - The company’s total assets amounted to HKD 1,966,130,000 as of June 30, 2020, compared to HKD 1,865,737,000 at the end of 2019[34]. Cash Flow and Financing - The company reported a net cash outflow from operating activities of HKD 43,497,000 for the six months ended June 30, 2020, compared to a net outflow of HKD 38,951,000 for the same period in 2019[40]. - The net cash inflow from investing activities was HKD 122,119,000, while financing activities resulted in a net cash outflow of HKD 52,993,000[40]. - The total cash and cash equivalents at the end of the period increased to HKD 78,124,000, up from HKD 40,980,000 at the end of June 2019[40]. - Financing costs decreased significantly to approximately HKD 10,337,000 from HKD 23,727,000 in the same period last year[10]. - The cost of services provided for the six months ended June 30, 2020, was HKD 58,231,000, a decrease of 16.8% from HKD 69,912,000 in the same period of 2019[85]. Strategic Initiatives - The company aims to achieve its business objectives for the third quarter while maintaining employee safety and operational normalcy[22]. - The group plans to continue expanding its market presence in Beijing and surrounding Hebei province, despite challenges posed by the pandemic[20]. - The company aims to expand its market presence in mainland China, focusing on geothermal energy solutions[67]. - The company is actively developing new technologies in the air energy and shallow geothermal energy sectors[69]. - The group expects to generate approximately RMB 250 million from the sale of industrial park assets, which will help ensure operational continuity and debt repayment[20]. Corporate Governance - The company has established an audit committee consisting of five independent non-executive directors to oversee financial reporting and risk management[153]. - The company adopted a share incentive plan on January 15, 2020, aimed at rewarding qualified participants contributing to the group's growth[152]. - The company failed to comply with GEM Listing Rule 5.05A regarding the minimum number of independent non-executive directors until March 28, 2020, when it appointed an additional independent director[150]. - The company has complied with the corporate governance code as per GEM Listing Rules, with exceptions noted for attendance at the annual general meeting[149]. - The company did not adopt a code of conduct for securities trading by directors but confirmed no violations of trading rules during the review period[154].

Financial Performance - For the three months ended March 31, 2020, the revenue was approximately HKD 44,940,000, a decrease of about 35% compared to the same period last year, which recorded approximately HKD 68,889,000[9]. - The net loss for the period was approximately HKD 18,797,000, compared to a net loss of approximately HKD 19,549,000 in the same period last year[11]. - Revenue from shallow geothermal energy utilization systems was HKD 41,272,000, down from HKD 64,806,000 year-on-year, reflecting a decline of approximately 36%[7]. - The gross profit for the same period was HKD 8,260,000, down from HKD 9,801,000 in 2019, indicating a decrease of about 15.7%[20]. - The company reported a significant foreign exchange loss of HKD 34,918,000 for the period, compared to a gain of HKD 16,317,000 in the same period last year[22]. - The company's loss before tax was HKD 18,152,000, compared to a loss of HKD 19,493,000 in the same period last year[44]. - The total cost of sales was HKD 36,680,000, down 37.9% from HKD 59,088,000 in Q1 2019[38]. - The company did not declare any dividends for the period ending March 31, 2020[43]. Income and Expenses - Other income and gains decreased from approximately HKD 11,270,000 to HKD 6,065,000, primarily due to adjustments related to accounts payable from the previous year[9]. - Other income and gains totaled HKD 6,065,000, a decline of 46.2% from HKD 11,270,000 in Q1 2019[35]. - Selling and distribution expenses increased to approximately HKD 7,888,000 from HKD 6,638,000 year-on-year, mainly due to hiring additional personnel during the pandemic[10]. - Financing costs decreased to approximately HKD 5,855,000 from HKD 11,588,000 in the previous year, mainly due to lower guarantee fees[10]. - The financing costs for the period were HKD 5,855,000, significantly reduced from HKD 11,588,000 in the previous year, marking a decrease of about 49.5%[20]. Operational Measures - The company implemented strict anti-epidemic measures to ensure employee safety and operational continuity during the pandemic[14]. - The company established a 24-hour service center to ensure timely maintenance and support for heating services during the pandemic[14]. - The company plans to fully explore the alternative energy heating market while ensuring employee safety and compliance with government regulations[15]. Shareholder Information - As of March 31, 2020, the company’s major shareholders include Mr. Xu Shengheng with 711,646,600 shares, representing approximately 15.72% of the total equity[65]. - The total equity held by Mr. Xu Shengheng, including options, amounts to 750,354,548 shares, which is approximately 16.58% of the total equity[65]. - Ms. Chen Huiji holds 58,290,400 shares, accounting for about 1.29% of the total equity, with total equity including options at 116,182,119 shares, or 2.57%[65]. - The company has a stock option plan that was adopted on July 28, 2010, and became unconditional on August 7, 2010, valid for ten years[69]. - As of March 31, 2020, Mr. Xu Shengheng has unexercised options totaling 37,725,148 shares at an exercise price of HKD 0.267[70]. - Ms. Chen Huiji has unexercised options totaling 43,788,119 shares at an exercise price of HKD 0.267[70]. - The company’s major shareholder, China Energy Conservation and Environmental Protection (Hong Kong) Investment Co., Ltd., is wholly owned by China Energy Conservation Group[76]. - The total equity held by Ms. Lu Haiwen, including her husband's shares, amounts to 750,354,548 shares, representing approximately 16.58% of the total equity[74]. Stock Options and Incentives - The company has 486,182,851 stock options that remain unexercised as of March 31, 2020[78]. - The exercise price for stock options granted in 2010 is HKD 0.379, while the exercise price for options granted in 2016 is HKD 0.267[79]. - The company has a total of 1,871,288 stock options granted to Mr. Wang Manquan, which remain unexercised as of March 31, 2020[79]. - The company has a total of 24,700,990 stock options granted to Mr. Wu Deshen, which remain unexercised as of March 31, 2020[79]. - The company adopted a share incentive plan on January 15, 2020, allowing employees, senior executives, directors, and consultants to participate[81]. - The maximum number of shares that can be granted under the share incentive plan is 135,000,000 shares, representing approximately 2.98% of the total shares issued as of the adoption date[81]. - The maximum number of shares that can be granted to selected participants shall not exceed 1% of the total shares issued as of the adoption date[81]. Compliance and Governance - The company is evaluating the impact of new and revised Hong Kong Financial Reporting Standards on its financial performance and position[26]. - The company has not applied any new Hong Kong Financial Reporting Standards that have been issued but are not yet effective, but is assessing their potential impact[26]. - The audit committee is composed of five independent non-executive directors, with Mr. Jia Wenzeng serving as the chairman[86]. - The audit committee has reviewed the unaudited performance of the group for the review period and provided recommendations and opinions[86]. - The company did not repurchase, redeem, or sell any of its listed securities during the review period[88].

Financial Performance - The company recorded revenue of approximately HKD 345,537,000 for the year, a decrease of about 12.9% compared to the previous year[11]. - The net loss for the year was HKD 445,023,000, an increase of approximately 6.3% compared to the previous year's loss, primarily due to a full provision for goodwill amounting to HKD 263,879,000[11]. - The total revenue for 2019 was approximately HKD 345,537,000, a decrease of 12.9% compared to HKD 396,793,000 in 2018[24]. - The net loss for 2019 was approximately HKD 445,023,000, compared to a net loss of HKD 418,511,000 in 2018[24]. - The gross profit for 2019 was approximately HKD 83,978,000, with a gross margin of 24.3%, an increase from 4.3% in 2018[26]. - The company reported a significant increase in impairment losses, including goodwill impairment of approximately HKD 263,879,000[22]. - The company experienced a revaluation loss of approximately HKD 5.742 million on its properties as of December 31, 2019[88]. - The company’s distributable reserves amounted to HKD 78.023 million, a decrease from HKD 811.952 million in 2018[99]. Cost Management - The company implemented strict cost control measures, resulting in a reduction in various expenses during the year[11]. - Research and development expenses for 2019 were approximately HKD 6,440,000, down from HKD 10,054,000 in 2018[22]. - Administrative expenses decreased by approximately 9.5% to HKD 101,696,000 in 2019 from HKD 112,326,000 in 2018[28]. - The implementation of refined management measures has significantly reduced operating losses in 2019 compared to 2018[56]. Market and Growth Potential - The geothermal energy sector is projected to grow at an annual rate of 10%, indicating significant market potential[12]. - The company estimates a potential market of approximately 3 trillion RMB for shallow geothermal energy in northern heating, with the rural market accounting for over 1 trillion RMB[61]. - The company has expanded its air-source and shallow geothermal heat pump product business, installing over 20,000 units in regions such as Hebei and Shanxi[34]. - The company continues to focus on the development and promotion of shallow geothermal energy as an alternative heating source[55]. Operational Challenges - The company anticipates challenges in the first and second quarters of 2020 due to the impact of the COVID-19 pandemic on overall economic activities[13]. - The company identified increased operational costs due to new projects outside Beijing, including transportation and travel expenses, which have raised overall project operating costs[58]. - The company faces challenges from rising competition in the clean energy heating sector, as potential competitors are intensifying their product development efforts[58]. - High accounts receivable levels are putting financial pressure on the company, affecting liquidity and leading to the abandonment of some intended projects[58]. Funding and Investments - New funding was successfully introduced in June and November, with two investors subscribing to the company's shares, which will enhance operational capital and support long-term development[11]. - The company completed the issuance of 250,000,000 shares at HKD 0.0785 per share on July 9, 2019, and another 250,000,000 shares at HKD 0.08 per share on December 9, 2019[47]. - The company intends to apply for financing of RMB 400,000,000 from a bank, with a guarantee provided by a related party, which will incur an annual guarantee fee of 1% on the principal amount[140]. Governance and Management - The company has a diverse board with members holding significant experience in finance, engineering, and environmental management, enhancing its strategic decision-making capabilities[73]. - The independent non-executive directors, including Mr. Wu and Mr. Guo, contribute extensive expertise in engineering and legal affairs, respectively, which supports the company's governance structure[74][75]. - The company has established systems to ensure compliance with regulatory requirements, including the Securities and Futures Ordinance and GEM Listing Rules[103]. - The board of directors includes a mix of executive and non-executive members, with several appointments made in 2019 to strengthen governance[107][111]. - The company has established a remuneration committee to review and formulate the remuneration policy for directors and senior management, which met once during the reporting period[166]. Shareholder Relations - The company emphasizes effective communication with shareholders to enhance investor relations and transparency regarding business performance and strategies[189]. - Shareholders have the right to request a special general meeting to address specified matters, provided they hold at least 10% of the company's paid-up capital[190]. - The company provides contact information for shareholders to submit inquiries or suggestions, ensuring open lines of communication[191]. Compliance and Audit - The independent auditor's report confirms that the consolidated financial statements fairly reflect the group's financial position as of December 31, 2019[195]. - The audit was conducted in accordance with Hong Kong auditing standards, ensuring the independence of the auditors[196]. - The audit committee, consisting of four independent non-executive directors, has reviewed the audited financial results for the year ended December 31, 2019, and held five meetings during the year[145]. - The company has complied with the GEM Listing Rules and maintained high standards of corporate governance throughout the reporting period[153].

Financial Performance - For the nine months ended September 30, 2019, the company's revenue was approximately HKD 234,445,000, a decrease of about HKD 157,833,000 compared to HKD 392,278,000 in the same period last year[5][9] - The company reported a net loss of approximately HKD 52,170,000 for the nine months ended September 30, 2019, compared to a profit of HKD 2,551,000 in the same period last year[5][11] - The gross profit for the nine months ended September 30, 2019, was HKD 69,343,000, down 39.7% from HKD 115,134,000 in the previous year[15] - The total comprehensive loss for the nine months ended September 30, 2019, was HKD 65,095,000, compared to a loss of HKD 57,221,000 in the same period of 2018[20] - The company reported a basic and diluted earnings per share of HKD 0.376 for the third quarter of 2019, compared to HKD 0.116 in the same quarter of 2018[17] - The basic loss per share attributable to ordinary shareholders of the parent company for the nine months ended September 30, 2019, was (49,682) thousand HKD, compared to a profit of 13,434 thousand HKD for the same period in 2018[42] - The company’s financial performance indicates a challenging market environment, as evidenced by the substantial losses reported in the latest quarter[42] Revenue Sources - Revenue from shallow geothermal energy utilization accounted for approximately 62% of total revenue, while equipment sales contributed about 30%[12] - Revenue from contracts with customers for the three months ended September 30, 2019, was HKD 129,005 thousand, an increase of 17.3% from HKD 109,994 thousand in the same period of 2018[28] - Other income increased from approximately HKD 2,346,000 in the previous year to about HKD 13,671,000, mainly due to adjustments in accounts payable and increased interest income[9] - The company reported a total of HKD 8,280 thousand in rental income for the nine months ended September 30, 2019, down from HKD 16,794 thousand in the same period of 2018[28] - The company’s total other income for the nine months ended September 30, 2019, was HKD 13,671 thousand, a significant increase from HKD 2,057 thousand in the same period of 2018[31] Cost Management - Administrative expenses decreased by approximately HKD 16,271,000 or 18.7% compared to the same period last year, primarily due to cost control efforts[10] - The administrative expenses for the nine months ended September 30, 2019, were HKD 70,763,000, a decrease of 18.6% from HKD 87,034,000 in the previous year[15] - Financing costs for the nine months ended September 30, 2019, were approximately HKD 32,824,000, down from HKD 35,777,000 in the previous year[11] - The company’s financing costs included HKD 6,262 thousand in interest on bank loans for the three months ended September 30, 2019, a decrease from HKD 8,031 thousand in the same period of 2018[33] Market Expansion and Strategy - The company is expanding its market presence by constructing demonstration projects in Hebei, Shanxi, and Shandong provinces to seek new breakthroughs[12][14] - The company anticipates that the shallow geothermal energy application market will gradually expand, although competition is expected to intensify[14] - The company is focusing on strategies to improve its financial position and may explore new product developments and market expansions in the future[50] - The management highlighted the importance of operational efficiency and cost management in navigating the current financial challenges[50] - The company is committed to enhancing shareholder value despite the recent financial setbacks and is exploring potential mergers and acquisitions to strengthen its market position[50] Shareholder Information - As of September 30, 2019, the company had a total of 1,190,000,000 shares outstanding, representing approximately 27.82% of the total equity held by China Energy Conservation and Environmental Protection (Hong Kong) Investment Limited[66] - Xu Shengheng holds 711,646,600 shares and has options to issue an additional 37,725,148 shares through stock options[1] - Chen Huiji owns 58,290,400 shares and has options to issue an additional 43,788,119 shares through stock options[2] - Liu Ening holds 250,000,000 shares, representing approximately 5.85% of the total equity[66] - The total equity held by Xu Shengheng and his spouse, Lu Haiwen, amounts to 750,354,548 shares, which is approximately 17.54% of the total equity[66] Stock Options and Governance - The company has a stock option plan that was adopted on July 28, 2010, and is valid for ten years, allowing the board to grant options to employees[59] - The stock options granted to directors include a total of 13,024,158 shares for Xu Shengheng and 19,087,129 shares for Chen Huiji, among others[59] - As of September 30, 2019, a total of 486,182,851 share options remain unexercised[70] - The exercise price for the share options ranges from 0.267 to 0.379 Hong Kong dollars[70] - The company has established an audit committee consisting of four independent non-executive directors to oversee financial reporting and risk management[76] Compliance and Conflicts of Interest - The company is subject to the Securities and Futures Ordinance, which requires disclosure of interests in shares and related securities[66] - There were no share buybacks, redemptions, or sales of the company's listed securities during the review period[79] - The company reported no competition or conflicts of interest involving its directors or major shareholders[75]