Financial Performance - Revenue for the three months ended March 31, 2023, was approximately HKD 31,667,000, a decrease of about 12.9% compared to HKD 36,356,000 in the same period of 2022[4] - Loss attributable to shareholders for the three months ended March 31, 2023, was approximately HKD 2,698,000, a reduction of about 42.2% from HKD 4,668,000 in the same period of 2022[4] - Gross profit for the three months ended March 31, 2023, was HKD 643,000, compared to HKD 452,000 in the same period of 2022, indicating an improvement in gross margin[5] - Operating loss for the three months ended March 31, 2023, was HKD 2,745,000, improved from HKD 4,716,000 in the same period of 2022[5] - Total comprehensive loss for the period was HKD 2,378,000, compared to HKD 4,691,000 in the same period of 2022, reflecting a reduction in overall losses[5] - The company reported a basic and diluted loss per share of approximately HKD 0.0146 for the three months ended March 31, 2023, compared to a loss of approximately HKD 0.0253 for the same period last year[20] Revenue Breakdown - Revenue from telecommunications services was HKD 1,131,000 for the three months ended March 31, 2023, compared to HKD 487,000 in the same period of 2022, showing significant growth[12] - Revenue from distribution business was HKD 30,536,000 for the three months ended March 31, 2023, down from HKD 35,869,000 in the same period of 2022[12] - Revenue from telecommunications services and distribution business was approximately HKD 1,131,000 and HKD 30,536,000, accounting for about 3.6% and 96.4% of total revenue, respectively[39] - The distribution business in Hong Kong generated revenue of approximately HKD 14,167,000 for the three months ended March 31, 2023, a decrease of about 21.9% from approximately HKD 18,131,000 in the same period last year[28] - The distribution business in China reported revenue of approximately HKD 2,416,000 for the three months ended March 31, 2023, an increase of about 2.9 times from approximately HKD 623,000 in the same period last year[29] - The revenue from mobile and data recharge distribution business decreased by approximately HKD 17,115,000, or 18.5%, to approximately HKD 13,953,000 compared to the same period last year[32] Cost Management and Business Strategy - The company is actively negotiating with service providers to further reduce the unit cost of call time and mobile data, aiming to lower the selling price of prepaid products to enhance competitiveness[28] - The company is expanding its business in Hong Kong to include the distribution of mobile phones and electronic products, which has become a major source of revenue[28] - The company is exploring overseas markets to offer mobile data services at lower prices for outbound travelers[28] - The group has strengthened cost control and extended credit terms for distributors to adapt to various market conditions[28] - The group continues to explore suitable business opportunities and investment prospects in the telecommunications sector while implementing strict cost control measures[38] Corporate Governance and Compliance - The company has maintained compliance with the corporate governance code as per GEM Listing Rules Appendix 15 during the three-month period ending March 31, 2023[58] - The company’s board members have confirmed adherence to the trading standards set forth in the GEM Listing Rules for securities transactions[59] - The company has disclosed no other interests or positions held by directors or major shareholders that require reporting under the Securities and Futures Ordinance as of March 31, 2023[53] - The company is committed to high levels of corporate governance to protect shareholder interests[58] Shareholder Information - As of March 31, 2023, the company has a significant shareholder, New Everich Holdings Limited, holding 104,437,500 shares, representing 56.49% of the total shares[51] - Li Jiancheng, a major shareholder, controls 56.49% of the shares through New Everich, and also holds 5,062,500 shares directly, accounting for 2.74%[51] - The company’s major shareholders include Golden Brand Holdings Limited, which holds 16,500,000 shares, representing 8.92%[54] Risk Management and Internal Control - The company has established a risk management and internal control system, which has been deemed sufficient and effective by the audit committee[66] - The management has confirmed the effectiveness of the financial reporting and risk management systems as of March 31, 2023[66] - The audit committee, consisting of three independent non-executive directors, reviewed the unaudited performance for the three months ending March 31, 2023, and confirmed compliance with applicable accounting standards[68] Business Development - The company continues to focus on its telecommunications services and distribution business as its primary revenue streams[7] - The group is optimistic about medium to long-term business development and is actively expanding market channels in various regions[35] - The group has established a formal cooperation agreement to accelerate its 5G infrastructure business development[35] Other Information - The company did not recommend any dividend for the three months ended March 31, 2023[4] - The company has not granted or cancelled any stock options under its stock option plan as of March 31, 2023, and there are no unexercised options remaining[57] - No shares were purchased, sold, or redeemed by the company or its subsidiaries during the three months ending March 31, 2023[61] - The company has no reported interests in any competing businesses as of March 31, 2023, except for a joint venture with Direct Telecom Limited, which may offer competing services[62] - The company is committed to not engaging in any business that competes with its RF-SIM operations in Hong Kong and Macau, as per a non-competition agreement signed in May 2010[65] - Sunward Telecom Limited's wholly-owned subsidiary, Zhonggang Tong Telecom Co., Ltd., has obtained exclusive licensing rights for RF-SIM intellectual property in Hong Kong and Macau[65] - The company focuses on the development, production, and sales of RF-SIM products, as well as the licensing of RF-SIM rights outside Hong Kong and Macau[63]

Financial Performance - The group recorded revenue of approximately HKD 151,976,000 for the year ended December 31, 2022, representing an increase of about 1.1% compared to the previous year[9]. - The loss attributable to equity shareholders decreased by approximately 13.3% to about HKD 12,317,000, compared to a loss of approximately HKD 14,205,000 in the previous year[9]. - Revenue from telecommunications services significantly decreased by approximately 76.4% to about HKD 2,619,000, down from approximately HKD 11,096,000 in the previous year[10]. - The distribution business generated revenue of approximately HKD 149,357,000, an increase of about 7.3% from approximately HKD 139,175,000 in the previous year[10]. - Revenue from telecommunications services decreased by approximately 19.4% to about HKD 2,564,000 compared to the previous year, with a reduction of approximately HKD 3,182,000[17]. - The distribution business generated revenue of approximately HKD 83,114,000, a decrease of about 11.2% from approximately HKD 93,607,000 in the previous year[20]. - Revenue from mobile and data recharge services in China was zero, down from approximately HKD 7,851,000 in the previous year due to intense competition and market challenges[22]. - Revenue from mobile phone and electronic product distribution in China increased approximately 3.5 times to about HKD 12,140,000, compared to approximately HKD 2,682,000 in the previous year[23]. - Revenue from mobile and data recharge distribution in Singapore increased by approximately 26.2% to about HKD 54,103,000, up from approximately HKD 42,886,000 in the previous year[26]. - The group's revenue for the year ended December 31, 2022, was approximately HKD 151,976,000, an increase of about 1.1% from HKD 150,271,000 in the previous year[33]. - The revenue from telecommunications services and distribution was approximately HKD 2,619,000 and HKD 149,357,000, accounting for 1.7% and 98.3% of total revenue, respectively[33]. - The group's gross profit increased by approximately 36.0% to about HKD 4,171,000, compared to HKD 3,068,000 in the previous year, mainly due to improved gross margins in distribution business in China[37]. - Other income for the year was approximately HKD 309,000, a 55.3% increase from HKD 199,000 in the previous year, primarily due to a one-time wage subsidy from the Hong Kong government[38]. - The group's administrative and other operating expenses decreased by approximately 4.6% to about HKD 17,021,000 from HKD 17,845,000 in the previous year[40]. Business Outlook and Strategy - The company anticipates a gradual recovery in the operating environment as travel demand rebounds following the easing of COVID-19 restrictions[11]. - The group maintains a cautiously optimistic outlook for medium to long-term business development, expecting increased customer usage of roaming products and services[11]. - The company plans to continue focusing on Mobility as a Service (MaaS) and is actively seeking partnerships in the Greater Bay Area and Southeast Asia to provide mobile communication services[14]. - The company is actively seeking distributors to expand overseas markets and enhance competitiveness by lowering the prices of prepaid products[18]. - The company plans to continue investing resources to increase the variety of mobile phones and electronic products offered, aiming to broaden revenue sources and improve business performance[20]. - The company is optimistic about the recovery of the tourism industry and expects to reintroduce roaming products and services to the market as travel demand rebounds[27]. - The company is preparing for a return to normal operations and is closely monitoring market developments to expand its business channels in various regions[27]. - The company aims to enhance its market position and increase revenue through the introduction of multiple prepaid products in a competitive telecommunications market[18]. - The group is actively exploring suitable business opportunities and investment prospects in the telecommunications sector while implementing strict cost control measures to improve business and financial performance[33]. - The group aims to accelerate its business development model by promoting synergy across various business segments, focusing on Mobility as a Service (MaaS) to extend its services into higher-value information services[31]. Financial Position and Assets - As of December 31, 2022, the total equity attributable to equity holders was approximately HKD 40,993,000, a decrease from HKD 55,979,000 as of December 31, 2021[50]. - The group's current assets net value was approximately HKD 36,426,000 as of December 31, 2022, down from HKD 51,355,000 as of December 31, 2021, with cash and cash equivalents of about HKD 15,858,000 compared to HKD 29,524,000 in the previous year[51]. - The current ratio as of December 31, 2022, was 6.3 times, lower than 8.5 times as of December 31, 2021[51]. - The total employee compensation for 2022 was approximately HKD 4,480,000, a decrease from HKD 4,958,000 in 2021[61]. - The group had no significant acquisitions, disposals, or major investments during the review year[56]. - As of December 31, 2022, the group had no outstanding loans or borrowings, resulting in a capital debt ratio that was not applicable[50]. - The group had a performance guarantee deposit of HKD 200,000 as of December 31, 2022, which was the same as the previous year[53]. - The group employed 20 staff members as of December 31, 2022, down from 21 in the previous year[59]. - The group has no derivative instruments for hedging currency risks as of December 31, 2022[52]. Corporate Governance and Compliance - The board does not recommend the payment of a final dividend for the year ended December 31, 2022[88]. - The company confirmed compliance with the disclosure requirements of GEM Listing Rules[99]. - The company has established a remuneration committee to review the remuneration policies and arrangements for all directors and senior management based on the group's performance and market practices[116]. - No remuneration was paid to directors or the five highest-paid employees as an incentive to join the group or as bonuses or severance payments during the year ended December 31, 2022[117]. - The company has arranged suitable liability insurance policies for its directors and senior management[112]. - There were no major contracts entered into by the company or its subsidiaries with controlling shareholders related to the group's business during the review period[113]. - The company has maintained a public float of no less than 25% of the total issued share capital as of December 31, 2022[144]. - The company has adopted a corporate governance report in compliance with the GEM Listing Rules, ensuring high standards of corporate governance to protect shareholders' interests[147]. - The company has established a code of conduct for directors regarding securities trading, confirming compliance with the required standards[148]. - The board consists of two executive directors, three non-executive directors, and three independent non-executive directors, ensuring compliance with GEM listing rules[151]. - The company has implemented a mechanism to ensure independent opinions are provided to the board, which is reviewed annually by the board and the nomination committee[152]. - The roles of the chairman and the CEO are separated, with Li Jiancheng as chairman and Peng Guozhou as CEO, ensuring independence and accountability[162]. - The company has obtained annual independence confirmations from independent non-executive directors, affirming their compliance with GEM listing rules[151]. - The board meets at least four times a year to determine overall strategic direction and approve financial results[154]. - The company has established a non-competition agreement with its shareholders, prohibiting them from engaging in any competing business in Hong Kong and Macau related to the RF-SIM business[163]. - The company has provisions for shareholders to assist in acquiring business opportunities that may compete with the group, ensuring favorable terms for the company[170]. Risk Management and Sustainability - The group faces various financial risks, including credit risk, interest rate risk, foreign exchange risk, and liquidity risk, and regularly reviews its capital structure[80]. - The group is committed to environmental sustainability and has implemented various eco-friendly measures without receiving any complaints regarding environmental issues during the review period[63]. - The group is committed to environmental protection and requires suppliers to comply with relevant environmental regulations[83]. - The company implemented a whistleblowing policy to promote compliance and ethical conduct, with no significant fraud or misconduct reported affecting financial statements for the year ending December 31, 2022[195]. - The company has adopted an anti-corruption policy as part of its corporate governance framework, emphasizing integrity and ethical conduct in business operations[198]. - The anti-corruption policy includes specific behavioral guidelines for employees and business partners to combat corruption, reflecting the company's commitment to ethical business practices and compliance with applicable laws[198]. Shareholder Relations and Communication - The company maintains a shareholder communication policy to ensure timely access to comprehensive and equal information for shareholders and potential investors[200]. - The company believes that maintaining high transparency is key to strengthening investor relations, consistently disclosing company information to shareholders and investors[200].

Performance Summary The company experienced a revenue decline and increased losses in the first nine months of 2022, leading to no interim dividend declaration [Q3 Performance Highlights](index=3&type=section&id=%E6%88%AA%E8%87%B3%E4%BA%8C%E9%9B%B6%E4%BA%8C%E4%BA%8C%E5%B9%B4%E4%B9%9D%E6%9C%88%E4%B8%89%E5%8D%81%E6%97%A5%E6%AD%A2%E4%B9%9D%E5%80%8B%E6%9C%88%E7%9A%84%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%AC%AC%E4%B8%89%E5%AD%A3%E5%BA%A6%E6%A5%AD%E7%B8%BE) For the nine months ended September 30, 2022, total revenue decreased by 5.2% year-on-year, with loss attributable to shareholders expanding by 29.5%, resulting in no interim dividend Key Performance Indicators for the First Nine Months of 2022 | Indicator | First Nine Months 2022 | YoY Change | | :--- | :--- | :--- | | Revenue | Approx. HKD 121.788 million | Decrease approx. 5.2% | | Loss attributable to company shareholders | Approx. HKD 13.356 million | Increase approx. 29.5% | | Proposed dividend | Not declared | - | Financial Statements The Group's financial statements reflect a period of declining revenue, increased losses, and a reduction in total equity [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) Revenue slightly decreased, while operating and net losses expanded year-on-year due to increased administrative expenses, leading to higher loss per share Summary of Profit or Loss Statement (For the Nine Months Ended September 30) | Item (HKD '000) | 2022 (Unaudited) | 2021 (Unaudited) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 121,788 | 128,465 | -5.2% | | Gross Profit | 1,059 | 1,639 | -35.4% | | Operating Loss | (13,504) | (10,454) | +29.2% | | Loss for the period | (13,359) | (10,311) | +29.6% | | Loss attributable to equity holders of the Company | (13,356) | (10,311) | +29.5% | | Loss per share (HK cents) | (7.22) | (5.58) | +29.4% | [Condensed Consolidated Statement of Changes in Equity](index=11&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) Total equity decreased from HKD 56.024 million to HKD 40.087 million due to period losses and negative comprehensive income items Changes in Total Equity (HKD '000) | Item | Amount | | :--- | :--- | | Balance at January 1, 2022 | 56,024 | | Total comprehensive income for the period | (15,937) | | Balance at September 30, 2022 | 40,087 | Notes to Financial Statements Detailed notes reveal a significant decline in telecommunication service revenue, stable distribution business, and a new impairment loss on trade receivables impacting profitability [Revenue Analysis](index=6&type=section&id=4.%20%E6%94%B6%E7%9B%8A) Total revenue is primarily from distribution business, which remained stable, while telecommunication services saw a nearly 90% decline Revenue by Business Segment (For the Nine Months Ended September 30) | Business Segment (HKD '000) | 2022 | 2021 | YoY Change | | :--- | :--- | :--- | :--- | | Telecommunication Services | 1,090 | 9,482 | -88.5% | | Distribution Business | 120,698 | 118,983 | +1.4% | | **Total** | **121,788** | **128,465** | **-5.2%** | [Key Expense Items for Loss Before Tax](index=8&type=section&id=6.%20%E9%99%A4%E7%A8%85%E5%89%8D%E虧%E6%90%8D) Loss before tax was significantly impacted by a new HKD 3.198 million impairment loss on trade receivables, absent in the prior period Key Expense Items (For the Nine Months Ended September 30) | Item (HKD '000) | 2022 | 2021 | | :--- | :--- | :--- | | Impairment loss on trade receivables | 3,198 | – | | Cost of inventories | 119,033 | 117,244 | | Salaries, wages and other benefits | 3,277 | 3,231 | Management Discussion and Analysis The Group's regional business performance varied, with challenges in Hong Kong and China's top-up services, but growth in China's distribution and Singapore's top-up businesses, alongside future strategic initiatives [Business Review and Outlook](index=12&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%89%8D%E6%99%AF) Business performance varied by region, with declines in Hong Kong telecom services, suspension of China top-up services, but strong growth in China distribution and stable Singapore operations, with future focus on 5G and cost control [Hong Kong Operations](index=12&type=section&id=%E6%96%BC%E9%A6%99%E6%B8%AF%E7%9A%84%E6%A5%AD%E5%8B%99) Hong Kong's telecom service revenue significantly decreased due to reduced tourism, and mobile phone distribution revenue also declined by 13.6% - Due to the COVID-19 pandemic, a significant reduction in overseas tourists (especially mainland Chinese tourists) adversely impacted prepaid roaming product sales, leading to a substantial **33.9% year-on-year decrease** in telecommunication service revenue (from HKD 1.583 million to HKD 1.046 million, referring to specific telecom services, differing from the total telecom service revenue in Note 4)[32](index=32&type=chunk) - Revenue from mobile phone and electronic product distribution business was approximately **HKD 60.67 million**, a decrease of approximately **13.6%** compared to the same period last year[34](index=34&type=chunk) [China Operations](index=13&type=section&id=%E6%96%BC%E4%B8%AD%E5%9C%8B%E7%9A%84%E6%A5%AD%E5%8B%99) China's mobile and data top-up services were suspended, but mobile phone and electronic product distribution revenue grew significantly by 2.7 times - Due to intense competition and low-profit margins, mobile and data top-up services have been suspended since Q3 2021, generating no revenue in the current period, compared to approximately **HKD 7.851 million** in the prior period[37](index=37&type=chunk) - Revenue from mobile phone and electronic product distribution business was approximately **HKD 8.107 million**, an increase of approximately **2.7 times** compared to the same period last year[38](index=38&type=chunk) [Singapore Operations](index=15&type=section&id=%E6%96%BC%E6%96%B0%E5%8A%A0%E5%9D%A1%E7%9A%84%E6%A5%AD%E5%8B%99) Singapore's mobile and data top-up distribution business achieved steady growth of 11.5% year-on-year through e-commerce partnerships - Revenue from Singapore's mobile and data top-up distribution business was approximately **HKD 51.921 million**, an increase of approximately **11.5%** compared to the same period last year[40](index=40&type=chunk) [Outlook](index=15&type=section&id=%E5%89%8D%E6%99%AF) The Group is cautiously optimistic, focusing on a 5G joint venture, strict cost control, and business model transformation towards higher-value information services - The company has entered into a framework agreement with Micas (Shenzhen) Telecommunications Co., Ltd. to establish a joint venture in Hong Kong, aiming to explore global 5G infrastructure opportunities by providing integrated chips and solutions for 5G small cell radio frequency units[43](index=43&type=chunk)[44](index=44&type=chunk) - The Group will implement strict cost control measures and accelerate the transformation of its business development model, shifting from traditional telecommunication services to higher-value information services[44](index=44&type=chunk)[45](index=45&type=chunk) [Financial Review](index=17&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) Total revenue decreased by 5.2%, gross profit by 35.4%, and loss attributable to shareholders expanded by 29.5% due to a significant impairment loss on trade receivables - Revenue decreased by **5.2%** to approximately **HKD 122 million**, primarily due to reduced revenue from telecommunication services and distribution business in Hong Kong[47](index=47&type=chunk) - Gross profit decreased by **35.4%** to approximately **HKD 1.059 million**, mainly due to a deteriorating gross margin in Hong Kong's distribution business and telecommunication services[47](index=47&type=chunk) - Administrative and other operating expenses increased by **18.4%**, primarily due to an impairment loss on trade receivables of approximately **HKD 3.198 million** recorded in the current period, with no such expense in the prior period[50](index=50&type=chunk) - Loss attributable to equity holders of the Company increased by **29.5%** to approximately **HKD 13.356 million**, mainly due to a significant increase in impairment loss on trade receivables[51](index=51&type=chunk) Other Information This section covers the full utilization of IPO proceeds, details directors' and major shareholders' interests, and addresses potential competing interests with a non-competition undertaking [Use of Proceeds from Initial Public Offering](index=19&type=section&id=%E6%9C%89%E9%97%9C%E6%96%BC%E4%BA%8C%E9%9B%B6%E4%B8%80%E9%9B%B6%E5%B9%B4%E5%85%AD%E6%9C%88%E4%BA%8C%E6%97%A5%E5%AE%8C%E6%88%90%E7%9A%84%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%82%A1%E4%BB%BD%E9%85%8D%E5%94%AE%EF%BC%88%E3%80%8C%E9%85%8D%E5%94%AE%E3%80%8D%EF%BC%89%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%EF%BC%88%E3%80%8C%E9%A6%96%E6%AC%A1%E5%85%AC%E9%96%8B%E7%99%BC%E5%94%AE%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E3%80%8D%EF%BC%89%E7%94%A8%E9%80%94%E7%9A%84%E6%9B%B4%E6%96%B0) Approximately HKD 69.2 million from the 2010 IPO has been fully utilized, with some reallocations to overseas distribution businesses - Approximately **HKD 69.2 million** from the initial public offering proceeds had been fully utilized as of September 30, 2022[53](index=53&type=chunk) - According to announcements in 2018 and 2021, the use of a portion of the unutilized net proceeds was changed and reallocated to businesses such as overseas distribution of mobile phones and equipment[53](index=53&type=chunk)[54](index=54&type=chunk) [Directors' and Major Shareholders' Interests](index=21&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E6%96%BC%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%82%B5%E6%AC%8A%E8%AD%89%E4%B8%AD%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) Chairman Mr. Li Kin Shing and his spouse hold approximately 59.23% equity, with New Everich Holdings Limited as the major controlling shareholder Major Shareholder Holdings (As of September 30, 2022) | Shareholder Name | Nature of Interest | Number of Ordinary Shares | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Li Kin Shing | Interest in controlled corporation and beneficial owner | 109,500,000 | 59.23% | | New Everich Holdings Limited | Beneficial owner | 104,437,500 | 56.49% | | Ms. Kwok King Wah | Interest in controlled corporation and spouse's interest | 109,500,000 | 59.23% | [Competing Interests](index=26&type=section&id=%E7%AB%B6%E7%88%AD%E6%AC%8A%E7%9B%8A) Potential competition from controlling shareholders' RF-SIM businesses outside Hong Kong and Macau is mitigated by a non-competition undertaking - Direct Telecom Limited and Shing Wah Telecom Limited, controlled by controlling shareholder Mr. Li Kin Shing and his spouse, whose businesses involve RF-SIM franchises in markets outside China (including Hong Kong and Macau), may have competing interests with the Group's business[75](index=75&type=chunk)[76](index=76&type=chunk) - To avoid conflicts of interest, the controlling shareholders have signed a non-competition undertaking deed, pledging not to compete with the Group's RF-SIM business in Hong Kong and Macau, and to offer relevant business opportunities to the company first[78](index=78&type=chunk)

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。 DIRECTEL HOLDINGS LIMITED 直 通 電 訊 控 股 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：8337） 中期報告 二零二二 香港聯合交易所有限公司（「聯交所」）GEM的特色 | | 截至六月三十日止三個月 | | 截至六月三十日止六個月 | | | --- | --- | --- | --- | --- | | | 二零二二年 | 二零二一年 | 二零二二年 | 二零二一年 | | | 千港元 | 千港元 | 千港元 | 千港元 | | | | （未經審核） （未經審核） （未經審核） （未經審核） | | | | 期內虧損 | (2,876) | (3,588) | (7,545) | (7,280) | | 期內其 ...

第一季度業績報告 二零二二 香港聯合交易所有限公司（「聯交所」）GEM的特色 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報告全部或任何部分內容而產生或因 倚賴該等內容而引致的任何損失承擔任何責任。 本報告的資料乃遵照《聯交所GEM證券上市規則》（「GEM上市規則」）而刊載，旨在 提供有關直通電訊控股有限公司（「本公司」）的資料；本公司董事（「董事」）願就本報 告的資料共同及個別承擔全部責任。各董事作出一切合理查詢後確認，就彼等所知及 所信：(1) 本報告所載資料在各重大方面均屬準確完整，並無誤導或欺詐成分；及(2) 並無遺漏任何其他事項，以致本報告或當中所載任何陳述產生誤導。 DIRECTEL ...

年 報 2021 香港聯合交易所有限公司（「聯交所」）GEM的特色 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的任何損失承擔任何責任。 本報告的資料乃遵照《聯交所GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供有關直通電訊控股有限公 司（「本公司」）的資料；本公司董事（「董事」）願就本報告的資料共同及個別承擔全部責任。各董事作出一切合理查 詢後確認，就彼等所知及所信：(1)本報告所載資料在各重大方面均準確完整，並無誤導或欺詐成分；及(2)並無遺 漏任何其他事項，以致本報告或當中所載任何陳述產生誤導。 | 目錄 | | --- | | 公司 ...

DIRECTEL HOLDINGS LIMITED 直 通 電 訊 控 股 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：8337） 第三季度業績報告 二零二一 DIRECTEL HOLDINGS LIMITED 直 通 電 訊 控 股 有 限 公 司 (Incorporated in the Cayman Islands with limited liability) (Stock Code: 8337) THIRD QUARTERLY REPORT 2021 香港聯合交易所有限公司（「聯交所」）GEM的特色 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主板上 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報告全部或任何部分內容而產 ...

[Financial Highlights](index=3&type=section&id=Highlights) [Summary of Interim Results for 2021](index=3&type=section&id=Unaudited%20Interim%20Results%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202021) For the six months ended June 30, 2021, the company's revenue decreased by 21.2% year-on-year, while loss attributable to shareholders significantly narrowed by 56.4%, with the Board deciding not to declare an interim dividend Key Interim Financial Indicators for 2021 | Metric | Amount (HKD) | Year-on-Year Change | | :--- | :--- | :--- | | Revenue | 85,489,000 | -21.2% | | Loss Attributable to Shareholders | 7,280,000 | -56.4% | | Interim Dividend | Not Declared | - | [Condensed Consolidated Financial Statements](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2021, the company experienced a year-on-year decline in both revenue and gross profit, yet significantly narrowed its operating and period losses due to a substantial reduction in administrative and other operating expenses, leading to a decrease in basic loss per share from 9.02 HK Cents to 3.94 HK Cents Core Profit or Loss Data (For the Six Months Ended June 30) | Item | 2021 (HKD Thousands) | 2020 (HKD Thousands) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 85,489 | 108,516 | -21.2% | | Gross Profit | 835 | 1,494 | -44.1% | | Operating Loss | (7,374) | (16,790) | +56.1% | | Loss Attributable to Shareholders for the Period | (7,280) | (16,682) | +56.4% | | Basic Loss Per Share (HK Cents) | (3.94) | (9.02) | +56.3% | [Condensed Consolidated Statement of Financial Position](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2021, the company's total assets and net assets slightly decreased compared to the end of 2020, maintaining a healthy net current assets position of HKD 55.95 million, despite a reduction in cash and cash equivalents Core Financial Position Data | Item | June 30, 2021 (HKD Thousands) | December 31, 2020 (HKD Thousands) | Change | | :--- | :--- | :--- | :--- | | Total Non-Current Assets | 8,375 | 9,163 | -8.6% | | Total Current Assets | 64,236 | 67,181 | -4.4% | | Total Current Liabilities | 8,289 | 4,933 | +68.0% | | Net Assets | 62,836 | 69,860 | -10.1% | | Cash and Cash Equivalents | 28,192 | 37,154 | -24.1% | [Condensed Consolidated Statement of Changes in Equity](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) As of June 30, 2021, the company's total equity decreased from approximately HKD 69.86 million at the beginning of the year to approximately HKD 62.84 million, primarily due to a loss of HKD 7.28 million recorded during the period - The total comprehensive loss for the period was **HKD 7,024,000**, primarily comprising a loss for the period of **HKD 7,280,000** and other comprehensive income of **HKD 256,000**[10](index=10&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) In the first half of 2021, the Group experienced a net cash outflow from operating activities of HKD 8.53 million, resulting in a net decrease in cash and cash equivalents of HKD 9.16 million, with the period-end cash balance at HKD 28.19 million Core Cash Flow Data (For the Six Months Ended June 30) | Item | 2021 (HKD Thousands) | 2020 (HKD Thousands) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (8,531) | (16,209) | | Net Decrease in Cash and Cash Equivalents | (9,156) | (16,483) | | Cash and Cash Equivalents at End of Period | 28,192 | 39,781 | [Notes to the Interim Financial Report](index=9&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Financial%20Report) [Revenue and Segment Information](index=11&type=section&id=5.%20Revenue%20and%206.%20Segment%20Information) The Group's total revenue is primarily derived from two business segments: distribution business and telecommunications services, accounting for 89.9% and 10.1% of total revenue respectively, both experiencing a decline compared to the prior period, with telecommunications services dropping by 61.6%, and Hong Kong remaining the main revenue source at 55.6% of total revenue Revenue by Business Segment (For the Six Months Ended June 30) | Business Segment | 2021 (HKD Thousands) | 2020 (HKD Thousands) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Telecommunications Services | 8,677 | 22,621 | -61.6% | | Distribution Business | 76,812 | 85,895 | -10.6% | | **Total** | **85,489** | **108,516** | **-21.2%** | Revenue by Geographical Region (For the Six Months Ended June 30) | Region | 2021 (HKD Thousands) | 2020 (HKD Thousands) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Hong Kong | 47,535 | 49,426 | -3.8% | | Mainland China | 9,267 | 22,798 | -59.4% | | Singapore | 28,687 | 36,292 | -21.0% | | **Total** | **85,489** | **108,516** | **-21.2%** | [Analysis of Loss Before Tax](index=16&type=section&id=8.%20Loss%20Before%20Tax) A key factor in the narrowed loss for the current period is the absence of impairment losses on trade receivables, which amounted to HKD 7.92 million in the corresponding period last year - For the six months ended June 30, 2021, impairment loss on trade receivables was **HKD 0**, while in the same period of 2020 it was **HKD 7,920,000**, which is a primary reason for the significant decrease in administrative expenses and the overall narrowed loss[34](index=34&type=chunk) [Dividends](index=17&type=section&id=10.%20Dividends) The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2021 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2021[36](index=36&type=chunk) [Share Capital Movements](index=23&type=section&id=18.%20Share%20Capital) On January 20, 2021, the company completed a share consolidation, merging every 20 ordinary shares of HKD 0.01 par value into 1 ordinary share of HKD 0.20 par value, reducing the number of issued ordinary shares from 3,697,500,000 to 184,875,000 - Pursuant to the resolution passed at the Extraordinary General Meeting on January 18, 2021, the company implemented a "Share Consolidation," consolidating every **20 shares into 1 share**, effective January 20, 2021[53](index=53&type=chunk) [Management Discussion and Analysis](index=29&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Outlook](index=29&type=section&id=Business%20Review%20and%20Outlook) The Group's business faces ongoing challenges due to the COVID-19 pandemic, severely impacting Hong Kong's telecommunications services with a 71.5% revenue decline due to reduced tourism, while Mainland China's top-up and distribution businesses also fell by 60.4% and 53.3% respectively, and Singapore's distribution business decreased by 21.0%, prompting the Group to implement cost controls and explore overseas markets with cautious optimism for medium to long-term development - The COVID-19 pandemic led to a significant reduction in overseas tourists, particularly from Mainland China, adversely affecting the Group's sales of prepaid roaming products[68](index=68&type=chunk) - The Hong Kong mobile phone and electronic product distribution business performed stably, with revenue slightly increasing by **0.2%** to approximately **HKD 46.74 million**[70](index=70&type=chunk) - Revenue from mobile and data top-up services in Mainland China decreased by **60.4%** year-on-year due to intense competition and the pandemic's impact[73](index=73&type=chunk) - Revenue from mobile and data top-up distribution business in Singapore decreased by **21.0%** year-on-year to approximately **HKD 28.69 million**[76](index=76&type=chunk) - Looking ahead, the Group will implement strict cost controls, accelerate business model transformation, and explore the extension of information services centered on MaaS (Mobility as a Service), maintaining cautious optimism for medium to long-term development[78](index=78&type=chunk) [Financial Review](index=34&type=section&id=Financial%20Review) In the first half of 2021, the Group's revenue decreased by 21.2% to HKD 85.49 million, and gross profit declined by 44.1%; however, due to a substantial reduction in administrative expenses (primarily from the absence of a large trade receivables impairment loss present in the prior period) and a decrease in net other losses, the loss attributable to shareholders significantly narrowed by 56.4%, from HKD 16.68 million to HKD 7.28 million - Administrative and other operating expenses decreased by **50.8%** year-on-year, mainly due to the absence of impairment loss on trade receivables in the current period, which amounted to **HKD 7.92 million** in the prior period[83](index=83&type=chunk) - Net other losses decreased by **95.0%** year-on-year, primarily due to reduced exchange losses and the absence of a **HKD 1.90 million** fair value change loss on contingent consideration in the prior period[81](index=81&type=chunk) - As a result of these factors, loss attributable to shareholders decreased by **56.4%** year-on-year[83](index=83&type=chunk) [Other Information](index=35&type=section&id=Other%20Information) This section covers IPO fund utilization, capital structure, liquidity, shareholders' equity, and corporate governance, noting that HKD 8 million of IPO funds remain unused for RF-SIM business, the company has no bank borrowings and a stable capital structure despite a decreased current ratio, and it complies with corporate governance codes while disclosing director and major shareholder holdings - As of June 30, 2021, approximately **HKD 8 million** of the approximately **HKD 69.2 million** IPO proceeds remained unutilized, primarily allocated to the RF-SIM business plan, expected to be fully utilized by the end of 2022[86](index=86&type=chunk)[88](index=88&type=chunk) Liquidity Indicators | Metric | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Net Current Assets | Approx. 55,947,000 HKD | Approx. 62,248,000 HKD | | Cash and Cash Equivalents | Approx. 28,192,000 HKD | Approx. 37,154,000 HKD | | Current Ratio | 7.7 times | 13.6 times | - As of June 30, 2021, the Group had no outstanding loans or borrowings[92](index=92&type=chunk) - For the six months ended June 30, 2021, the company complied with the Corporate Governance Code set out in Appendix 15 to the GEM Listing Rules[115](index=115&type=chunk)

DIRECTEL HOLDINGS LIMITED 直通電訊控股有限公司 （於開曼群島註冊成立的有限公司） （股份代號：8337） 第一季度業績報告 二零二一 香港聯合交易所有限公司（「聯交所」）GEM的特色 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主板上市 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報告全部或任何部分內容而產生或因倚賴該等 內容而引致的任何損失承擔任何責任。 本報告的資料乃遵照《聯交所GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供 有關直通電訊控股有限公司（「本公司」）的資料；本公司董事（「董事」）願就本報告的資 料共同及個別承擔全部責任。各董事作出一切合理查詢後確認，就彼等所知及所信：(1) 本報告所載資料在各重大 ...

[Chairman's Statement](index=6&type=section&id=%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A) [Annual Results and Review](index=6&type=section&id=%E5%B9%B4%E5%BA%A6%E6%A5%AD%E7%B8%BE%E8%88%87%E5%9B%9E%E9%A1%A7) In 2020, the Group's total revenue decreased by 12.7% year-on-year, while loss attributable to equity holders significantly narrowed by 98.9%, primarily due to a sharp decline in telecommunications services revenue 2020 Key Performance Indicators | Indicator | 2020 | 2019 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | HKD 213.8 million | HKD 244.8 million | -12.7% | | Loss attributable to equity holders | HKD 0.668 million | HKD 59.076 million | -98.9% | | Basic and diluted loss per share | HKD 0.36 cents | HKD 34.00 cents (restated) | -98.9% | - Telecommunications services revenue significantly decreased by **41.2%** from HKD 61.723 million to **HKD 36.292 million**, a primary factor in the Group's overall weak performance[11](index=11&type=chunk) - Distribution business (mobile phones, electronic products, and top-up vouchers) revenue was approximately **HKD 177.5 million**, a slight decrease of **3.1%** year-on-year, expected to remain the Group's main revenue source in the future[11](index=11&type=chunk) [Outlook](index=6&type=section&id=%E5%89%8D%E6%99%AF) The Group maintains cautious optimism for the future, anticipating a recovery in tourism and demand for roaming products with widespread vaccine adoption - The Group expects its roaming products and services to regain market demand with the recovery of global tourism[12](index=12&type=chunk) - The future strategic core is "Mobile as a Service" (MaaS), aiming to establish partnerships with the tourism, hotel, airline, and insurance industries to provide mobile communication services for travelers in the Greater Bay Area and Southeast Asia[12](index=12&type=chunk) [Management Discussion and Analysis](index=8&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) [Business Review and Outlook](index=8&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%89%8D%E6%99%AF) This year, the Group's operations faced challenges across all markets, leading to significant revenue shifts and strategic adjustments towards "Mobile as a Service" (MaaS) with strict cost control [Hong Kong Operations](index=8&type=section&id=%E6%96%BC%E9%A6%99%E6%B8%AF%E7%9A%84%E6%A5%AD%E5%8B%99) Hong Kong operations were severely impacted by the COVID-19 pandemic, leading to an 80.7% year-on-year reduction in telecommunications services revenue, while mobile phone and electronic product distribution business grew by 7.4% - Due to the sharp decline in tourists caused by COVID-19, the Group's prepaid roaming product sales were severely hit, with telecommunications services revenue significantly decreasing by **80.7%** from HKD 22.668 million in the prior year to **HKD 4.374 million**[18](index=18&type=chunk) - Mobile phone and electronic product distribution business became the main revenue source in Hong Kong, with annual revenue of approximately **HKD 103.8 million**, a year-on-year increase of approximately **7.4%**[19](index=19&type=chunk) [China Operations](index=9&type=section&id=%E6%96%BC%E4%B8%AD%E5%9C%8B%E7%9A%84%E6%A5%AD%E5%8B%99) China operations faced intense competition and pandemic-related impacts, resulting in a 16.8% decline in mobile and data top-up services revenue and a 71.2% drop in mobile phone and electronic product distribution revenue - Mobile and data top-up services revenue was approximately **HKD 31.855 million**, a year-on-year decrease of approximately **16.8%**, primarily due to intense industry competition and operator tariff adjustments[22](index=22&type=chunk) - Mobile phone and electronic product distribution business revenue was approximately **HKD 4.63 million**, a significant year-on-year decrease of approximately **71.2%**, mainly due to customer order cancellations and increased credit risk from some distributors due to the pandemic[23](index=23&type=chunk) [Singapore Operations](index=10&type=section&id=%E6%96%BC%E6%96%B0%E5%8A%A0%E5%9D%A1%E7%9A%84%E6%A5%AD%E5%8B%99) Singapore's mobile and data top-up distribution business remained stable with a slight 1.8% year-on-year decrease, but the goodwill from acquisition was fully impaired due to underperformance - Mobile and data top-up distribution business revenue was approximately **HKD 69.045 million**, a slight year-on-year decrease of **1.8%**[27](index=27&type=chunk) - Goodwill of approximately **HKD 5.942 million** arising from the acquisition of South Data, the Singapore business, was fully impaired during the year due to its actual performance falling short of expectations[28](index=28&type=chunk) [Financial Review](index=11&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) For FY2020, total revenue decreased by 12.7% to HKD 213.8 million, but gross profit increased by 52.9%, and a significant net other income of HKD 36.405 million from the elimination of contingent consideration led to a 98.9% reduction in loss attributable to equity holders 2020 Financial Performance Summary (HKD thousand) | Item | 2020 | 2019 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 213,786 | 244,823 | -12.7% | | Cost of sales | (211,892) | (243,584) | -13.0% | | Gross profit | 1,894 | 1,239 | +52.9% | | Net other income/(loss) | 36,405 | (2,626) | N/A | | Administrative and other operating expenses | (38,799) | (57,784) | -32.9% | | Loss attributable to equity holders | (668) | (59,076) | -98.9% | - Net other income significantly increased, primarily due to a gain of approximately **HKD 35.21 million** from the elimination of contingent consideration payable for the acquisition of Sun Tai Investment[40](index=40&type=chunk) - Administrative expenses decreased mainly because impairment losses on goodwill and intangible assets significantly reduced from approximately **HKD 30.5 million** last year to approximately **HKD 5.94 million**, though partly offset by an increase in impairment losses on trade receivables[41](index=41&type=chunk) [Other Information](index=14&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) As of the end of 2020, approximately HKD 61.2 million of the total HKD 69.2 million IPO proceeds had been utilized, with about HKD 8 million allocated for RF-SIM business in Hong Kong and Macau remaining unutilized due to slower progress Use of IPO Proceeds (As of December 31, 2020) (HKD million) | Use | Original Allocation | Revised Allocation | Actual Use | | :--- | :--- | :--- | :--- | | Expand Asia Pacific business | 22.7 | 22.7 | 22.7 | | Upgrade telecommunications facilities | 20.8 | 12.8 | 12.8 | | Develop RF-SIM business | 18.9 | 12.3 | 4.3 | | Overseas mobile phone distribution | – | 12.1 | 12.1 | | Working capital | 6.8 | 9.3 | 9.3 | | **Total** | **69.2** | **69.2** | **61.2** | - The unutilized balance of approximately **HKD 8 million** allocated for the RF-SIM business plan is currently held as interest-bearing deposits in banks due to slower-than-expected business development progress[48](index=48&type=chunk)[50](index=50&type=chunk) [Capital Structure, Liquidity and Financial Resources](index=15&type=section&id=%E8%B3%87%E6%9C%AC%E6%9E%B6%E6%A7%8B%E3%80%81%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group maintained a robust capital structure with no outstanding loans or borrowings at year-end, holding net current assets of approximately HKD 62.25 million and a current ratio of 13.6 times - As of December 31, 2020, the Group had no outstanding loans or borrowings, and the gearing ratio was not applicable[51](index=51&type=chunk) Liquidity Indicators (At Year-End) | Indicator | 2020 | 2019 | | :--- | :--- | :--- | | Net current assets | HKD 62.248 million | HKD 89.314 million | | Cash and cash equivalents | HKD 37.154 million | HKD 56.625 million | | Current ratio | 13.6 times | 12.1 times | [Employees and Remuneration Policy](index=17&type=section&id=%E5%93%A1%E5%B7%A5%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of the end of 2020, the Group had 23 employees, an increase of one from the previous year, with total employee remuneration decreasing to approximately HKD 4.632 million Employee Distribution and Remuneration | Item | 2020 | 2019 | | :--- | :--- | :--- | | Total number of employees | 23 | 22 | | Total employee remuneration | HKD 4.632 million | HKD 5.125 million | [Directors' Report](index=18&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%A0%B1%E5%91%8A) [Principal Businesses and Risks](index=18&type=section&id=%E4%B8%BB%E8%A6%81%E6%A5%AD%E5%8B%99%E5%8F%8A%E9%A2%A8%E9%9A%AA) The Group, primarily an investment holding company with subsidiaries providing mobile telecommunications and distribution services, faces key risks including intense market competition, reliance on third-party service providers, and cybersecurity threats - Key risks include: - **Intense Competition**: The market is characterized by price pressure, potentially leading to market share loss - **Reliance on Service Providers**: As a mobile virtual network operator, business relies on third-party network infrastructure - **Information Systems/Technology**: Business stability depends on the protection and stable operation of information technology systems - **Development Strategy**: Expanding into overseas markets poses risks related to unfamiliar regulatory environments - **Cybersecurity**: Handling large volumes of customer data makes the Group vulnerable to cyber threats - **Financial Risks**: Exposure to credit, interest rate, foreign exchange, and liquidity risks[70](index=70&type=chunk)[72](index=72&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk)[78](index=78&type=chunk) [Financial Information and Dividends](index=21&type=section&id=%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E5%8F%8A%E8%82%A1%E6%81%AF) The Board does not recommend a final dividend for the year, consistent with the previous year, with approximately HKD 53.5 million in distributable reserves available as of December 31, 2020 - The Board does not recommend the payment of a final dividend for the year ended December 31, 2020[85](index=85&type=chunk) - As of December 31, 2020, the Company had approximately **HKD 53.496 million** in reserves available for distribution to equity holders[90](index=90&type=chunk) [Major Customers and Suppliers](index=22&type=section&id=%E4%B8%BB%E8%A6%81%E5%AE%A2%E6%88%B6%E5%8F%8A%E4%BE%9B%E6%87%89%E5%95%86) The Group exhibits high concentration in both its customer and supplier bases, with the top five customers accounting for 74.3% of total revenue and the top five suppliers for 76.1% of total purchases in 2020 Customer and Supplier Concentration (2020) | Item | Percentage | | :--- | :--- | | Revenue from largest customer | 32.3% | | Revenue from top five customers | 74.3% | | Purchases from largest supplier | 32.6% | | Purchases from top five suppliers | 76.1% | [Events After Reporting Period](index=23&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) In January 2021, the Company completed a share consolidation, merging every twenty HKD 0.01 par value ordinary shares into one HKD 0.20 par value consolidated share, resulting in 184,875,000 issued shares - The Company completed a share consolidation on January 20, 2021, on a "20-for-1" basis[96](index=96&type=chunk) [Share Capital and Interests](index=27&type=section&id=%E8%82%A1%E6%AC%8A%E5%8F%8A%E6%AC%8A%E7%9B%8A) As of the end of 2020, Chairman Mr. Li Kin Shing beneficially owned approximately 59.23% of the Company's shares, and a non-competition undertaking was in place to address potential conflicts of interest related to the RF-SIM business - Chairman Mr. Li Kin Shing is deemed to hold approximately **59.23%** of the Company's shares (**56.49%** through controlled corporations and **2.74%** beneficially owned)[114](index=114&type=chunk) - Controlling shareholder Mr. Li Kin Shing and his associated companies have potential competition with the Group in the RF-SIM business in China (excluding Hong Kong and Macau), but a non-competition undertaking deed has been signed[121](index=121&type=chunk)[125](index=125&type=chunk) [Share Option Scheme](index=30&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The Company adopted a 10-year share option scheme in 2016, with no share options granted or cancelled during 2020, and no outstanding share options at year-end - No share options were granted or cancelled during the year, and as of December 31, 2020, there were no outstanding share options under the share option scheme[130](index=130&type=chunk) [Corporate Governance Report](index=32&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%A0%B1%E5%91%8A) [Board and Committees](index=32&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%8F%8A%E5%A7%94%E5%93%A1%E6%9C%83) The Company adheres strictly to corporate governance codes, with an eight-member Board ensuring power balance and three independent non-executive director-chaired committees assisting in fulfilling responsibilities - The Board comprises **8** directors, including **3** independent non-executive directors, meeting the GEM Listing Rules requirements[140](index=140&type=chunk)[141](index=141&type=chunk) - The roles of Chairman (Mr. Li Kin Shing) and Chief Executive Officer (Mr. Pang Kwok Chau) are separated, ensuring a balance of power[150](index=150&type=chunk) - The Company has established an Audit Committee, a Nomination Committee, and a Remuneration Committee, all chaired by Independent Non-executive Director Ms. Li Man Yee[159](index=159&type=chunk)[164](index=164&type=chunk)[181](index=181&type=chunk) [Shareholders' Rights and Investor Relations](index=46&type=section&id=%E8%82%A1%E6%9D%B1%E6%AC%8A%E5%88%A9%E5%8F%8A%E6%8A%95%E8%B3%87%E8%80%85%E9%97%9C%E4%BF%82) The Company prioritizes shareholder communication through various channels and outlines procedures for shareholders to convene extraordinary general meetings, make inquiries, and propose resolutions, safeguarding their participation rights - Shareholders holding not less than one-tenth of the paid-up share capital carrying the right to vote at general meetings may request to convene an extraordinary general meeting[190](index=190&type=chunk) [Biographies of Directors and Senior Management](index=48&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E9%AB%98%E7%B4%9A%E7%AE%A1%E7%90%86%E5%B1%A4%E5%B1%A5%E6%AD%B7) This section provides detailed background, industry experience, and responsibilities within the Group for the Company's Board members and senior management [Independent Auditor's Report](index=51&type=section&id=%E7%8D%A8%E7%AB%8B%E6%A0%B8%E6%95%B8%E5%B8%AB%E5%A0%B1%E5%91%8A) [Audit Opinion](index=51&type=section&id=%E5%AF%A9%E8%A8%88%E6%84%8F%E8%A6%8B) KPMG issued an unmodified opinion on the Company's consolidated financial statements for the year ended December 31, 2020, affirming their fair presentation in accordance with International Financial Reporting Standards and Hong Kong Companies Ordinance - The auditor believes that the consolidated financial statements fairly and truly reflect the Group's financial position and performance in accordance with International Financial Reporting Standards[207](index=207&type=chunk) [Key Audit Matters](index=51&type=section&id=%E9%97%9C%E9%8D%B5%E5%AF%A9%E8%A8%88%E4%BA%8B%E9%A0%85) The auditor identified goodwill impairment testing and revenue recognition as key audit matters, focusing on significant management estimates for goodwill and accounting treatment for telecommunications and distribution business revenues - **Goodwill Impairment Testing**: Focus on the impairment assessment of goodwill arising from the acquisition of the Singapore business, as it involves significant estimates and judgments regarding future cash flow forecasts[211](index=211&type=chunk) - **Revenue Recognition**: - **Telecommunications Services**: Revenue derived from a large volume of low-value transactions and involves estimates of customers' "unused rights," posing subjectivity and risk of error - **Distribution Business**: Revenue is a key performance indicator, with a risk of revenue being recorded in incorrect periods to meet financial targets[215](index=215&type=chunk)[220](index=220&type=chunk) [Audited Consolidated Financial Statements](index=57&type=section&id=%E7%B6%93%E5%AF%A9%E6%A0%B8%E5%90%88%E4%BD%B5%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=57&type=section&id=%E5%90%88%E4%BD%B5%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The statement shows 2020 revenue at HKD 213.8 million, a 12.7% year-on-year decrease, but the annual loss significantly narrowed to HKD 0.668 million from HKD 59.076 million in 2019 due to a substantial increase in net other income Consolidated Statement of Profit or Loss Summary (HKD thousand) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Revenue | 213,786 | 244,823 | | Gross profit | 1,894 | 1,239 | | Net other income/(loss) | 36,405 | (2,626) | | Profit/(loss) before tax | 220 | (58,816) | | Loss for the year attributable to equity holders | (668) | (59,076) | [Consolidated Statement of Financial Position](index=58&type=section&id=%E5%90%88%E4%BD%B5%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of the end of 2020, total assets decreased significantly to HKD 76.344 million from HKD 115.8 million, primarily due to full goodwill impairment and lower cash balances, while total liabilities decreased to HKD 6.484 million mainly due to the elimination of contingent consideration Consolidated Statement of Financial Position Summary (HKD thousand) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Non-current assets | 9,163 | 18,479 | | Current assets | 67,181 | 97,335 | | **Total assets** | **76,344** | **115,814** | | Current liabilities | 4,933 | 8,021 | | Non-current liabilities | 1,551 | 38,191 | | **Total liabilities** | **6,484** | **46,212** | | **Total equity** | **69,860** | **69,602** | [Consolidated Statement of Cash Flows](index=60&type=section&id=%E5%90%88%E4%BD%B5%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) In 2020, the Group experienced a net cash outflow from operating activities of HKD 19.04 million, compared to a net inflow of HKD 9.623 million in the prior year, primarily due to changes in working capital, resulting in a year-end cash balance of HKD 37.154 million Consolidated Statement of Cash Flows Summary (HKD thousand) | Item | 2020 | 2019 | | :--- | :--- | :--- | | Net cash from operating activities | (19,040) | 9,623 | | Net cash from investing activities | 202 | 249 | | Net cash from financing activities | (1,055) | 31,561 | | Net (decrease)/increase in cash and cash equivalents | (19,893) | 41,433 | | Cash and cash equivalents at beginning of year | 56,625 | 15,711 | | **Cash and cash equivalents at end of year** | **37,154** | **56,625** | [Notes to the Financial Statements](index=61&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed supplementary information to the financial statements, covering key accounting policies, segment information, asset and liability breakdowns, related party transactions, financial risk management, and significant accounting estimates and judgments - Segment information indicates that the distribution business contributed the vast majority of revenue (**HKD 177.5 million**), while telecommunications services revenue was **HKD 36.29 million**[319](index=319&type=chunk) - Goodwill impairment loss of **HKD 5.942 million** due to underperformance of Singapore operations; goodwill of **HKD 28.061 million** was impaired in 2019 due to underperformance of China operations[357](index=357&type=chunk)[364](index=364&type=chunk) - Loss allowance for trade receivables significantly increased from **HKD 3.765 million** to **HKD 18.362 million**, reflecting increased credit risk[407](index=407&type=chunk) [Five-Year Financial Summary](index=124&type=section&id=%E4%BA%94%E5%B9%B4%E6%A6%82%E8%A6%81) This section provides a summary of the Group's key financial data for five consecutive fiscal years from 2016 to 2020, illustrating trends in performance and financial position, showing revenue peaking in 2018 before two consecutive years of decline, and a significant narrowing of loss in 2020 after a substantial loss in 2019 Five-Year Financial Summary (HKD thousand) | Item | 2020 | 2019 | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 213,786 | 244,823 | 256,279 | 59,096 | 6,415 | | (Loss)/Profit attributable to equity holders | (668) | (59,076) | (1,778) | (6,222) | 3,243 | | Total assets | 76,344 | 115,814 | 144,233 | 142,577 | 114,140 | | Total equity | 69,860 | 69,602 | 98,059 | 100,622 | 106,620 |