Financial Performance - For the nine months ended September 30, 2020, the group's revenue was approximately HKD 66.1 million, an increase of about 5.3% compared to the same period in 2019[6]. - The gross profit margin for the nine months ended September 30, 2020, was approximately 14.2%, down from 18.0% for the same period in 2019[6]. - The basic loss per share for the nine months ended September 30, 2020, was approximately HKD 0.15, compared to HKD 0.09 for the same period in 2019[6]. - The net loss for the nine months ended September 30, 2020, was HKD 1.2 million, compared to a profit of HKD 0.1 million for the same period in 2019[7]. - The total comprehensive loss for the nine months ended September 30, 2020, was HKD 2.5 million, compared to HKD 2.1 million for the same period in 2019[7]. - The total comprehensive expenses for the nine months ended September 30, 2020, amounted to HKD 4,089,000, compared to HKD 2,100,000 for the same period in 2019, reflecting an increase of 94.7%[12]. - The group recorded a loss of HKD 1.2 million for the nine months ended September 30, 2020, compared to a loss of HKD 0.7 million for the same period in 2019[30]. - Basic loss per share increased from approximately HKD 0.09 to HKD 0.15, reflecting the increase in the period loss[31]. Revenue Breakdown - For the nine months ended September 30, 2020, the revenue from sales of industrial aluminum electrolytic capacitors was HKD 52,790,000, an increase of 20.5% compared to HKD 43,682,000 for the same period in 2019[13]. - The revenue from trading electronic components for the nine months ended September 30, 2020, was HKD 13,263,000, a decrease of 30.5% compared to HKD 19,051,000 for the same period in 2019[13]. - The company's total revenue for the three months ended September 30, 2020, was HKD 28,468,000, compared to HKD 21,411,000 for the same period in 2019, representing an increase of 33.5%[13]. - The group's revenue increased by approximately 5.3% from about HKD 62.7 million for the nine months ended September 30, 2019, to about HKD 66.1 million for the nine months ended September 30, 2020[24]. Expenses and Costs - The group incurred administrative expenses of HKD 8.58 million for the nine months ended September 30, 2020, down from HKD 9.30 million in the previous year[7]. - The financing costs for the nine months ended September 30, 2020, were HKD 0.297 million, a decrease from HKD 0.557 million in the same period in 2019[7]. - Sales costs rose by approximately 10.1% from about HKD 51.5 million to about HKD 56.7 million, consistent with revenue growth[25]. - Administrative expenses decreased by approximately 0.7 million HKD from about HKD 9.3 million to about HKD 8.6 million, mainly due to reduced consultancy and compliance costs[28]. Dividends and Shareholder Information - The board did not recommend any dividend payment for the nine months ended September 30, 2020, consistent with the previous year[6]. - The company did not declare or pay any dividends for the two periods under review, but proposed a final dividend of HKD 0.002 per share for the year ended December 31, 2019, totaling HKD 1,600,000[17]. - The group did not declare any dividends for the nine months ended September 30, 2020[33]. - Vertical Investment holds a direct interest of 600,000,000 shares, representing 75% of the company's equity[45]. Future Outlook and Management Commentary - The board expressed confidence in future growth despite the current challenges faced by the group[6]. - The company's management has indicated a commitment to improving operational efficiency and exploring new market opportunities to enhance revenue growth in the future[21]. - The ongoing economic uncertainty is expected to persist, prompting the group to continuously review its business model to adapt to the challenging operating environment[23]. Compliance and Governance - The board of directors has confirmed compliance with the trading standards as per GEM Listing Rules up to September 30, 2020[49]. - The audit committee, consisting of three independent non-executive directors, has reviewed the unaudited quarterly results for the nine months ending September 30, 2020[57]. - No significant acquisitions or disposals occurred during the nine months ended September 30, 2020[36]. - No purchases, sales, or redemptions of the company's listed securities occurred during the nine months ending September 30, 2020[56]. - The company has not granted any stock options under its stock option plan since its adoption on October 24, 2017[48]. Capital Expenditures - The group has committed capital expenditures of approximately HKD 539,000 as of September 30, 2020, primarily for equipment and machinery to expand capacity[35].

Financial Performance - For the six months ended June 30, 2020, the group's revenue was approximately HKD 37.6 million, a decrease of about 9.0% compared to the same period in 2019[8]. - The gross profit margin for the same period was approximately 14.6%, down from 17.9% in the previous year[8]. - The group reported a loss of approximately HKD 1.5 million for the six months ended June 30, 2020, compared to a loss of HKD 1.1 million for the same period in 2019[8]. - The basic and diluted loss per share for the six months ended June 30, 2020, was HKD 0.18, compared to a loss of HKD 0.13 for the same period in 2019[9]. - The company incurred a total comprehensive expense of HKD (4,031,000) for the six months ended June 30, 2020, compared to HKD (1,695,000) for the same period in 2019, indicating a significant increase in losses[13]. - Revenue and gross profit for the six months ended June 30, 2020, decreased by approximately HKD 3.7 million and HKD 1.9 million, respectively, compared to the same period in 2019[53]. Assets and Liabilities - Total assets as of June 30, 2020, were HKD 71.09 million, down from HKD 76.73 million as of December 31, 2019[10]. - Current liabilities increased to HKD 25.40 million as of June 30, 2020, compared to HKD 28.15 million as of December 31, 2019[10]. - The net cash balance decreased to HKD 27.34 million as of June 30, 2020, from HKD 38.92 million as of December 31, 2019[10]. - As of June 30, 2020, the company's net assets decreased to HKD 89,219,000 from HKD 93,250,000 as of December 31, 2019, representing a decline of approximately 4.4%[11]. - The company's total liabilities included lease liabilities of HKD 403,000 as of June 30, 2020, down from HKD 1,104,000 as of December 31, 2019, showing a decrease of approximately 63.5%[11]. - The total interest-bearing bank borrowings and lease liabilities as of June 30, 2020, were approximately HKD 8.5 million, down from HKD 14.2 million as of December 31, 2019[62]. Cash Flow - The company reported a net cash outflow from operating activities of HKD (1,455,000) for the six months ended June 30, 2020, compared to HKD (2,557,000) for the same period in 2019, indicating an improvement of approximately 43%[14]. - Total cash and cash equivalents decreased by HKD 11,077,000 for the six months ended June 30, 2020, compared to a decrease of HKD 5,923,000 in the same period of 2019, reflecting a worsening cash position[14]. - The company’s investment activities resulted in a net cash outflow of HKD (1,992,000) for the six months ended June 30, 2020, compared to HKD (3,482,000) in the same period of 2019, reflecting a decrease in investment expenditures[14]. Revenue Breakdown - For the six months ended June 30, 2020, external sales of industrial aluminum electrolytic capacitors amounted to HKD 27,090,000, while electronic component trading generated HKD 10,495,000, totaling HKD 37,585,000[23]. - Revenue from China increased to HKD 30,946,000 in 2020 from HKD 29,703,000 in 2019, while revenue from Hong Kong decreased to HKD 2,607,000 from HKD 4,594,000[27]. Expenses - The group’s administrative expenses decreased to HKD 6.23 million for the six months ended June 30, 2020, from HKD 6.45 million in the previous year[9]. - Sales and distribution expenses decreased by 28.1% from approximately HKD 1.7 million to approximately HKD 1.2 million, primarily due to reduced salaries and sales commissions[50]. - The total depreciation expense for property, plant, and equipment was HKD 3,166,000 for the six months ended June 30, 2020, compared to HKD 2,948,000 in 2019[32]. Strategic Initiatives - The company plans to continue investing in technology development to enhance its competitive edge despite ongoing economic uncertainties[46]. - The company has fully utilized HKD 2.7 million for the rent and renovation expenses of the second production facility in Dongguan, Guangdong Province, with the remaining funds expected to be fully utilized by December 31, 2021[71]. - The company has completed the hiring and retention of additional employees for its R&D department, fully utilizing the allocated funds for this purpose[71]. Governance and Compliance - The company has adopted the corporate governance code as per GEM Listing Rules Appendix 15, with a noted deviation regarding the separation of roles between the Chairman and CEO[82]. - The Audit Committee, consisting of three independent non-executive directors, has been established to assist the board in reviewing internal audit functions and financial reporting procedures[86].

Financial Performance - For the three months ended March 31, 2020, the group's revenue was approximately HKD 16.1 million, a decrease of about 14.9% compared to HKD 18.9 million for the same period in 2019[6]. - The gross profit margin for the three months ended March 31, 2020, was approximately 16.0%, down from 18.1% for the same period in 2019[6]. - The group reported a loss of approximately HKD 1.5 million for the three months ended March 31, 2020, compared to a loss of HKD 0.5 million for the same period in 2019[6]. - Basic loss per share for the three months ended March 31, 2020, was approximately HKD 0.19, compared to HKD 0.06 for the same period in 2019[6]. - The total comprehensive loss for the three months ended March 31, 2020, was HKD 2.2 million, compared to a comprehensive income of HKD 0.9 million for the same period in 2019[7]. - The group's gross profit fell by approximately 24.7% from about HKD 3.4 million for the three months ended March 31, 2019, to about HKD 2.6 million for the same period in 2020[26]. - The cost of sales decreased by approximately 12.8% from about HKD 15.5 million for the three months ended March 31, 2019, to about HKD 13.5 million for the same period in 2020[25]. Expenses - The group's selling and distribution expenses for the three months ended March 31, 2020, were HKD 703,000, down from HKD 869,000 for the same period in 2019[7]. - The group's administrative expenses for the three months ended March 31, 2020, were HKD 3.6 million, compared to HKD 3.0 million for the same period in 2019[7]. - Sales and distribution expenses decreased from approximately HKD 0.9 million for the three months ended March 31, 2019, to approximately HKD 0.7 million for the three months ended March 31, 2020, a decline of about 19.1%[28]. - Administrative expenses increased from approximately HKD 3.0 million for the three months ended March 31, 2019, to approximately HKD 3.6 million for the three months ended March 31, 2020, primarily due to adjustments in management and employee salaries[28]. Income and Tax - Other income for the three months ended March 31, 2020, was HKD 365,000, compared to HKD 207,000 for the same period in 2019[7]. - The income tax expense for the three months ended March 31, 2020, was HKD 106 thousand, a decrease from HKD 247 thousand in 2019[14]. - Income tax expenses rose from approximately HKD 37,000 to approximately HKD 0.1 million for the same periods, an increase of about HKD 69,000[29]. Dividends - The board of directors did not recommend the payment of any dividend for the three months ended March 31, 2020, consistent with no dividends declared for the same period in 2019[6]. - The company did not declare or pay any dividends during the two periods[18]. - No dividends were declared or paid to ordinary shareholders for the three months ended March 31, 2020, consistent with the same period in 2019[33]. Shareholder Information - The major shareholder, Vertical Investment, holds 600,000,000 shares, representing 75% of the company's equity[40]. Corporate Governance - The company has adopted the corporate governance code as per GEM listing rules and has complied with its provisions, except for the separation of roles between the Chairman and CEO[46]. - The audit committee has been established with three independent non-executive directors to oversee internal audit functions and financial reporting processes[50]. Operational Impact - The ongoing COVID-19 pandemic has caused delays in factory operations post-Chinese New Year, impacting revenue[23]. - The company plans to continue investing in technology development to enhance its competitive advantage despite economic uncertainties[23]. Other Information - The company had no significant capital commitments as of March 31, 2020, compared to approximately HKD 0.9 million as of March 31, 2019[34]. - There were no significant acquisitions or disposals during the three months ended March 31, 2020[35]. - The company had no significant contingent liabilities as of March 31, 2020[36]. - No purchase, sale, or redemption of the company's listed securities occurred during the three-month period ending March 31, 2020[48].

Financial Performance - The company reported revenue of HKD 82.2 million for the year 2019, despite a challenging operating environment due to trade disputes and economic slowdown[6]. - The company's revenue decreased from approximately HKD 100.4 million for the year ended December 31, 2018, to approximately HKD 82.2 million for the year ended December 31, 2019, representing a decline of about 18.1%[14]. - The gross profit fell from approximately HKD 22.6 million for the year ended December 31, 2018, to approximately HKD 17.7 million for the year ended December 31, 2019, a decrease of about 21.6%[14]. - Sales revenue from industrial aluminum electrolytic capacitors decreased from approximately HKD 78.8 million to approximately HKD 59.6 million, a decline of about 24.3%[10]. - The company's annual profit decreased from approximately HKD 5.1 million for the year ended December 31, 2018, to approximately HKD 1.5 million for the year ended December 31, 2019, a decline of about 70.6%[21]. - The basic earnings per share fell to HKD 0.45, primarily due to the decrease in annual profit[22]. Dividends and Shareholder Returns - The board has proposed a final dividend of HKD 0.02 per share for the year, compared to no dividend in 2018[8]. - The company proposed a final dividend of HK$0.02 per share for the year ended December 31, 2019, totaling HK$1.6 million, compared to HK$0 for 2018[129]. Strategic Initiatives - The company is developing a new product, a discrete semiconductor packaged multilayer polymer aluminum capacitor, expected to enter commercial production in the second half of 2020[6]. - The company aims to expand its customer base and business scale through horizontal expansion in the passive components market[6]. - The company plans to enhance production capacity and introduce new products to meet diverse customer needs, including a new product for various electronic applications[13]. - The company aims to improve its technological capabilities and competitive advantages through ongoing investment in technology development[11]. - The company plans to focus on environmental, social, and governance (ESG) investments as a key strategy in the coming year[7]. Operational Challenges - The company acknowledges the challenges ahead in 2020 but remains confident about future prospects[8]. - The company will continue to review its operations and actively seek global business opportunities in response to the challenging economic environment[10]. - The company is closely monitoring the impact of the COVID-19 pandemic on its business operations[193]. Governance and Compliance - The company has been actively involved in corporate governance, ensuring transparency and accountability in its operations[51]. - The company has adopted the corporate governance code as per GEM listing rules, ensuring compliance with the principles and practices outlined therein[56]. - The independent non-executive directors have confirmed their independence according to GEM listing rules, ensuring proper governance oversight[68]. - The company emphasizes the importance of risk management and compliance, with dedicated roles for internal auditing and anti-money laundering[46]. - The board consists of various committees, including the audit, remuneration, and nomination committees, to oversee different aspects of the company's affairs[79]. Financial Position - The company's total assets as of December 31, 2019, were approximately HKD 122.5 million, compared to HKD 125.5 million in 2018[23]. - As of December 31, 2019, the group's cash and cash equivalents were approximately HKD 38.9 million, compared to HKD 38.2 million in 2018[24]. - The total interest-bearing bank borrowings as of December 31, 2019, amounted to approximately HKD 10.6 million, up from HKD 9.9 million in 2018[24]. - The group's debt-to-equity ratio as of December 31, 2019, was 0.11 times, unchanged from 2018[24]. - The company's available distributable reserves as of December 31, 2019, amounted to approximately HK$48 million, unchanged from 2018[146]. Human Resources - The total employee compensation for the year ended December 31, 2019, was HKD 14.7 million, a decrease from HKD 20.6 million in 2018[31]. - The company provides tailored training for newly appointed directors to ensure they understand their duties and the company's operations[77]. - Directors are encouraged to participate in ongoing professional development to enhance their skills and knowledge[75]. Market Position - The company operates in a highly competitive aluminum electrolytic capacitor industry, with revenue heavily reliant on the Chinese market[134]. - The company has established a good reputation for producing high-quality and reliable products, which is crucial for maintaining customer relationships[137]. - The largest customer accounted for approximately 15.9% of total revenue for the year ended December 31, 2019, up from 14.3% in 2018, while the top five customers represented about 53.5% of total revenue[139]. - The largest supplier accounted for approximately 9.6% of total purchases for the year ended December 31, 2019, down from 19.9% in 2018, with the top five suppliers making up about 40.0% of total purchases[139]. Research and Development - The company has fully allocated funds for research and development by hiring and retaining additional staff[181]. - The company has fully utilized funds to promote its brand products by hiring more sales personnel and distributing promotional materials[182]. Stock Options and Incentives - The company has implemented a stock option plan approved on October 24, 2017, to incentivize directors[148]. - The total number of shares available for issuance under the plan is 80,000,000 shares, which represents 10% of the total issued shares as of December 31, 2019[3]. - No stock options have been granted under the plan since its adoption on October 24, 2017, up to the date of this annual report[12].

Financial Performance - For the nine months ended September 30, 2019, the group's revenue was approximately HKD 62.7 million, a decrease of about 22.7% compared to the same period in 2018[13] - The gross profit margin for the nine months ended September 30, 2019, was approximately 18.0%, down from 22.9% for the same period in 2018[13] - The basic loss per share for the nine months ended September 30, 2019, was approximately HKD 0.09, compared to a basic earnings per share of HKD 0.71 for the same period in 2018[13] - The total comprehensive loss for the nine months ended September 30, 2019, was HKD 2.1 million, compared to a total comprehensive income of HKD 2.6 million for the same period in 2018[15] - The company reported a loss of HKD 725,000 for the nine months ended September 30, 2019, compared to a profit of HKD 5,669,000 for the same period in 2018[31] - The total comprehensive expense for the nine months ended September 30, 2019, was HKD 2,100,000, compared to a total comprehensive income of HKD 5,669,000 for the same period in 2018[26] - The company recorded a loss of approximately HKD 0.7 million for the nine months ended September 30, 2019, compared to a profit of approximately HKD 5.7 million for the same period in 2018[44] Revenue Breakdown - For the three months ended September 30, 2019, the group's revenue was HKD 21.4 million, compared to HKD 21.7 million for the same period in 2018[15] - Revenue from sales of industrial aluminum electrolytic capacitors for the three months ended September 30, 2019, was HKD 12,091,000, down 32.5% from HKD 17,827,000 in the same period of 2018[25] - Revenue from trading electronic components for the nine months ended September 30, 2019, was HKD 19,051,000, an increase of 23.8% compared to HKD 15,382,000 for the same period in 2018[25] Expenses - The administrative expenses for the nine months ended September 30, 2019, were HKD 9.3 million, an increase from HKD 8.5 million for the same period in 2018[15] - The financing costs for the nine months ended September 30, 2019, were HKD 0.6 million, compared to HKD 0.1 million for the same period in 2018[15] - The company's selling and distribution expenses decreased from approximately HKD 3.1 million to approximately HKD 2.4 million, a decline of about 22.1%[40] - Administrative expenses increased from approximately HKD 8.5 million to approximately HKD 9.3 million, an increase of about HKD 0.8 million[41] Dividends - The board of directors did not recommend the payment of any dividends for the nine months ended September 30, 2019, consistent with no dividends declared for the same period in 2018[13] - The company did not declare or pay any dividends during the reported periods[29] Taxation - The effective tax expense for the nine months ended September 30, 2019, was HKD 844,000, a decrease of 53.7% from HKD 1,820,000 for the same period in 2018[26] Corporate Governance - The company has complied with the corporate governance code, except for a deviation regarding the separation of the roles of chairman and CEO[66] - The audit committee, consisting of three independent non-executive directors, has reviewed the unaudited quarterly results for the nine months ending September 30, 2019[73] - The company is committed to regularly reviewing and improving its corporate governance practices[69] - The chairman and CEO, Mr. Wen, is responsible for major decision-making and overall strategic planning[68] Future Outlook - The company is closely monitoring the future development trends in the Chinese semiconductor and passive components market to seek opportunities for revenue expansion[35] - The company plans to continue investing in technology development to enhance its technical capabilities and competitive advantages[35] Shareholding and Stock Options - As of September 30, 2019, Vertical Investment holds 600,000,000 shares, representing a 75% equity stake in the company[58] - The company has not granted any stock options under its stock option plan since its adoption on October 24, 2017[62] - The company has not identified any other individuals holding 5% or more of the shares as of September 30, 2019[61] Securities Trading - The company has adopted written guidelines for securities trading by employees who may possess inside information[63] - No purchases, sales, or redemptions of the company's listed securities occurred during the nine months ending September 30, 2019[70] - The company has not disclosed any interests in competing businesses by its directors or controlling shareholders[65]

VERTICAL INTERNATIONAL HOLDINGS LIMITED 弘 浩 國 際 控 股 有 限 公 司 ( 於 開 曼 群 島 註 冊 成 立 的 有 限 公 司 ) 股份代號: 8375 中期報告 2019 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。 本報告乃遵照聯交所GEM證券上巿規則（「GEM上市規則」）而刊載，旨在提 供有關弘浩國際控股有限公司（「本公司」）之資料，本公司各董事（「董事」） 願就本報告共同及個別地承擔全部責任，並在作出一切合理查詢 ...

Financial Performance - For the three months ended March 31, 2019, the group's revenue was approximately HKD 18.9 million, a decrease of about 30.6% compared to the same period in 2018[14]. - The gross profit margin for the same period was approximately 18.1%, down from 22.2% in the previous year[14]. - The group recorded a loss of approximately HKD 0.5 million for the three months ended March 31, 2019, compared to a profit of approximately HKD 1.2 million in the same period of 2018[14]. - Basic loss per share for the period was approximately HKD 0.06, compared to a basic earnings per share of approximately HKD 0.15 in the previous year[14]. - Total comprehensive income for the period was HKD 887,000, down from HKD 2.7 million in the same period of 2018[16]. - The group's gross profit decreased by 43.4% compared to the same period last year, reflecting the impact of the trade war and tariff disputes between China and the United States[35]. - The group's gross profit decreased from approximately HKD 6.1 million for the three months ended March 31, 2018, to approximately HKD 3.4 million for the three months ended March 31, 2019, a decline of approximately 43.4%[40]. - The gross profit margin fell from approximately 22.2% for the three months ended March 31, 2018, to approximately 18.1% for the three months ended March 31, 2019, primarily due to a revenue drop of approximately HKD 8.4 million without a corresponding reduction in fixed manufacturing costs[40]. Revenue Breakdown - Sales of industrial aluminum electrolytic capacitors amounted to HKD 13.6 million, down from HKD 19.97 million, while electronic component trading generated HKD 5.31 million, down from HKD 7.29 million[26]. - The group's revenue for the three months ended March 31, 2019, was approximately HKD 18.9 million, a decrease of 30.6% from approximately HKD 27.3 million in the same period of 2018[38]. Expenses and Costs - The group's administrative expenses were HKD 3.0 million, slightly down from HKD 3.1 million in the previous year[16]. - Financing costs increased to HKD 121,000 from HKD 35,000 in the previous year[16]. - Sales and distribution expenses decreased from approximately HKD 1.2 million for the three months ended March 31, 2018, to approximately HKD 0.9 million for the three months ended March 31, 2019, a decline of approximately 26.1%[42]. - The cost of sales decreased from approximately HKD 21.2 million to approximately HKD 15.5 million, a reduction of about 27.0%[39]. Dividends and Shareholder Returns - The board does not recommend the payment of any dividend for the three months ended March 31, 2019, consistent with the previous year[14]. - The company did not declare or recommend any dividends for the three months ended March 31, 2019, consistent with the previous year[30]. - No dividends were declared or paid to ordinary shareholders for the three months ended March 31, 2019, consistent with the same period in 2018[49]. Future Outlook and Strategy - The management anticipates ongoing economic uncertainties will continue to affect the group's revenue and significantly reduce gross profit throughout 2019[35]. - The group is committed to investing in technology development to enhance its technical capabilities and maintain competitive advantages despite the challenges posed by global trade disputes[36]. - The group will continue to review its business methods and actively seek global opportunities in response to the rapidly changing business environment[35]. Other Information - The deferred tax credit for the three months ended March 31, 2019, was HKD 247,000, compared to HKD 210,000 in the same period of 2018[27]. - The group had capital commitments of approximately HKD 0.9 million as of March 31, 2019, related to the purchase of equipment and machinery to expand production capacity, down from HKD 8.9 million as of March 31, 2018[50]. - There were no significant acquisitions or disposals during the three months ended March 31, 2019[51]. - The group did not have any significant contingent liabilities as of March 31, 2019[52]. - The company has not announced any new product or technology developments during this reporting period[16]. - The company has not purchased, sold, or redeemed any of its listed securities during the three months ended March 31, 2019[71]. - The audit committee has reviewed the unaudited quarterly results for the three months ended March 31, 2019[75]. - The company has adopted the corporate governance code as per GEM listing rules and has complied with most provisions, except for the separation of roles between the chairman and CEO[69].

Financial Performance - The company's revenue for the year ended December 31, 2018, decreased by approximately 8.5% compared to the previous year, reflecting the impact of global trade tariff disputes[9] - The group's revenue decreased from approximately HKD 109.7 million for the year ended December 31, 2017, to approximately HKD 100.4 million for the same period in 2018, representing a decline of about 8.5%[11] - Revenue from the sale of industrial aluminum electrolytic capacitors remained stable at approximately HKD 78.8 million for the year ended December 31, 2018, compared to HKD 78.4 million for the previous year[9] - The group's gross profit decreased from approximately HKD 24.2 million in 2017 to approximately HKD 22.6 million in 2018, a decline of about 6.5%[14] - Selling and distribution expenses increased from approximately HKD 2.6 million in 2017 to approximately HKD 4.0 million in 2018, an increase of about HKD 1.4 million[15] - Administrative expenses rose from approximately HKD 7.9 million in 2017 to approximately HKD 12.1 million in 2018, an increase of about HKD 4.1 million[16] - Cash and cash equivalents decreased to approximately HKD 38.2 million as of December 31, 2018, from HKD 45.0 million in 2017[21] - The company’s reserves available for distribution to shareholders as of December 31, 2018, were approximately HKD 48 million, down from HKD 55 million in 2017[120] Strategic Initiatives - The company plans to enhance production efficiency significantly in the coming years through the acquisition of advanced production machinery and equipment[7] - The company aims to optimize product design and technology, standardize raw materials, and enhance production automation as part of its strategic deployment for 2019[8] - The company will continue to invest resources in research and development to provide advanced technical solutions and maintain its position as a leading quality capacitor manufacturer[8] - The company plans to invest in technology development and expand production capacity to meet market demand and enhance competitive advantage[10] - The company plans to continue expanding its market presence and product offerings in the upcoming fiscal year[34] - The management team emphasizes ongoing development of new technologies and products to enhance competitive advantage[34] Corporate Governance - The company has adopted the corporate governance code as per GEM Listing Rules Appendix 15, ensuring compliance with governance standards[49] - The board consists of five members, including two executive directors and three independent non-executive directors[52] - The company will continue to enhance its corporate governance practices to align with business operations and development[50] - The company has established a corporate governance framework and developed policies and procedures to enhance board oversight[49] - The independent non-executive directors provide independent judgment on the company's strategy, performance, resources, and ethical standards[43] - The company has a dedicated company secretary with over 25 years of experience in corporate services[47] - The company has a structured approach to reviewing and improving its corporate governance practices regularly[50] - The company has confirmed that there were no violations of the trading code by relevant employees during the reporting period[51] - The company emphasizes the importance of good corporate governance standards to protect shareholder interests and enhance corporate value[49] - The company has adhered to the GEM listing rules regarding the appointment of at least three independent non-executive directors, constituting at least one-third of the board[57] Risk Management - The board confirmed its responsibility for risk management and internal control systems, which are designed to identify and manage risks affecting operational efficiency[80] - The board regularly reviews risk management and internal control systems, including financial, operational, and compliance controls, and considers them effective and adequate[82] - The company has implemented credit risk management policies to reduce credit risk associated with trade receivables[81] - The company has faced intense competition in the aluminum electrolytic capacitor industry, which poses a significant risk to its operations[108] - The company has no long-term contracts with its customers, which adds to the operational risks[108] Environmental Management - The group has established an environmental management system certified to ISO 14001:2015, aiming to minimize negative environmental impacts during production[174] - The group reported nitrogen oxide emissions of 4.64 kg and sulfur oxide emissions of 0.07 kg for the fiscal year ending December 31, 2018[179] - The group has reduced VOC emissions significantly by improving the thermal hardening process and replacing UV lamps with UV LED tubes[176] - The group has implemented waste reduction measures and has not experienced any major violations of environmental regulations during the reporting period[185] - The company has established solid waste management procedures to classify waste into recyclable and non-recyclable categories[182] Employee Management - As of December 31, 2018, the company had a total of 129 employees, a decrease from 154 employees in 2017[194] - The employee distribution by region shows 5% in Hong Kong and 95% in Mainland China for 2018, consistent with 2017[196] - The gender distribution in 2018 was 61% male and 39% female, compared to 62% male and 38% female in 2017[199] - The age distribution for employees in 2018 indicates 23% are aged 18-25, 42% are aged 26-35, 30% are aged 36-45, and 5% are aged 46-55[194] - The overall employee count reflects a trend of reduction, indicating potential challenges in employee retention or recruitment strategies[194]