Company Information [Company Information](index=4&type=section&id=Company%20Information) The company's board comprises executive and independent non-executive directors, with key contact and listing information provided - Board composition includes executive directors Mr. Kam Kin Pan (Chairman) and Ms. Wong Mei Chun (appointed July 28, 2021), with Mr. Hung Cheung Fai retiring December 30, 2021. Independent non-executive directors include Ms. Chan Sin Wah (appointed July 28, 2021), Mr. Yu Tat Chi (appointed September 20, 2021), and Ms. Yip Tan (appointed August 30, 2022), alongside former members Mr. Leung Chi Hung, Ms. Wong Lai Na, and Mr. Yim Kwun Wing[8](index=8&type=chunk) - Key contact information includes Mr. Li Wai Chi as Company Secretary, Evergreen (HK) Certified Public Accountants Limited as auditor, stock code **8422**, and company website http://www.hklistco.com.com/8422[9](index=9&type=chunk)[10](index=10&type=chunk) Chairman's Report and Management Discussion and Analysis [Business Review](index=5&type=section&id=Business%20Review) The Group primarily provides specialized and general building engineering services in Hong Kong, achieving revenue and gross profit growth in FY22, but still recorded a net loss due to impairment losses, share-based payments, and expected credit loss provisions - Core business involves providing specialized engineering (foundation, site formation, demolition, ground investigation) and general building engineering (superstructure, slope maintenance, hoarding, alteration and addition, renovation) services in Hong Kong[13](index=13&type=chunk) Key Financial Data for Business Review in FY2022 | Metric | June 30, 2022 (HK$ million) | June 30, 2021 (HK$ million) | | :--- | :--- | :--- | | Revenue | 65.3 | 33.8 | | Gross Profit | 8.2 | 2.1 | | Loss and Total Comprehensive Loss | 8.9 | 7.4 | [Financial Review](index=5&type=section&id=Financial%20Review) During the reporting period, the Group's revenue significantly increased and gross profit margin improved, but administrative expenses rose due to share-based payments, and impairment losses on property, plant and equipment and right-of-use assets were recognized, leading to an expanded net loss Key Financial Data for Financial Review in FY2022 | Metric | June 30, 2022 (HK$ million) | June 30, 2021 (HK$ million) | Change | | :--- | :--- | :--- | :--- | | Revenue | 65.3 | 33.8 | **Increased by 93.2%** | | Gross Profit Margin | 12.6% | 6.3% | **Increased by 6.3 percentage points** | | Administrative Expenses | 12.8 | 8.5 | **Increased by 50.6%** | | Impairment Loss on Property, Plant and Equipment | 1.2 | 0.1 | **Increased by 930.1%** | | Impairment Loss on Right-of-Use Assets | 0.3 | 0.7 | **Decreased by 57.1%** | | Net Loss | 8.9 | 7.4 | **Loss expanded by 20.3%** | - The increase in administrative expenses was primarily due to the recognition of share-based payment expenses of approximately **HK$3.1 million** for the year ended June 30, 2022[16](index=16&type=chunk) [Outlook](index=6&type=section&id=Outlook) Facing uncertainties from the COVID-19 pandemic and intense competition, the Group maintains cautious optimism for the construction and renovation market, focusing on foundation, site formation, superstructure, and renovation projects while adhering to prudent financial management and exploring other investment opportunities to diversify revenue - Market challenges: The operating environment is expected to be challenging, with COVID-19 increasing uncertainties in project execution[20](index=20&type=chunk) - Business strategy: Focus on foundation and site formation works, superstructure construction, and renovation projects to seize business opportunities[20](index=20&type=chunk) - Financial strategy: Adhere to prudent financial management principles to ensure sustainable growth and capital adequacy[20](index=20&type=chunk) - Diversified income: Consider other investment opportunities to expand revenue sources while being mindful of associated risks[21](index=21&type=chunk) [Liquidity and Financial Resources](index=6&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2022, the Group maintained a sound financial position with a decrease in cash and bank balances but a high current ratio, a slight increase in gearing ratio, and raised HK$8.1 million through share placement for construction projects and general working capital Key Data for Liquidity and Financial Resources in FY2022 | Metric | June 30, 2022 (HK$ million) | June 30, 2021 (HK$ million) | Change | | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 30.7 | 49.4 | **Decreased by 37.8%** | | Restricted Cash Balances | 0.7 | 2.1 | **Decreased by 66.7%** | | Current Ratio | 7.2 times | 8.3 times | **Decreased by 13.25%** | | Gearing Ratio | 1.8% | 1.2% | **Increased by 0.6 percentage points** | - Fundraising activities: Net proceeds of approximately **HK$8.1 million** were raised through share placement on November 16, 2021, fully utilized for construction projects (**HK$5.1 million**) and general working capital (**HK$3.0 million**)[24](index=24&type=chunk) - Asset pledge: Approximately **HK$0.7 million** in deposits placed with an insurance company are pledged as collateral for performance guarantees[26](index=26&type=chunk) - Foreign exchange risk: The majority of business transactions are denominated in HKD, posing no significant foreign exchange fluctuation risk, and no foreign currency hedging policy has been adopted[28](index=28&type=chunk) - Capital structure: Share consolidation became effective on April 12, 2022, where every ten shares of HK$0.01 each were consolidated into one share of HK$0.1 each[29](index=29&type=chunk) - Contingent liabilities: Performance guarantees of approximately **HK$2.6 million** were provided for construction contracts, with directors believing the likelihood of claims from customers to be low[33](index=33&type=chunk) [Employees and Remuneration Policy](index=8&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2022, the company employed 26 staff, with staff costs increasing to HK$12.6 million, and provides remuneration based on position, qualifications, and performance, along with training and a share option scheme to incentivize employees Staff Situation in FY2022 | Metric | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Number of Employees | 26 employees | 21 employees | | Staff Costs | 12.6 HK$ million | 8.8 HK$ million | - Remuneration structure: Based on basic salary, bonuses (referencing Group performance and employee performance) and a share option scheme[35](index=35&type=chunk) - Share option scheme: **10,000,000 share options** have been granted to directors and employees[35](index=35&type=chunk) [Dividends and Dividend Policy](index=8&type=section&id=Dividends%20and%20Dividend%20Policy) The company has adopted a dividend policy where the Board will consider financial performance, retained earnings, working capital needs, future business plans, liquidity, and overall economic conditions to determine dividend distribution, and no final dividend is recommended for the year ended June 30, 2022 - Dividend policy: The Board determines dividend distribution based on various factors including financial performance, earnings, working capital, business plans, liquidity, and economic conditions[36](index=36&type=chunk) - FY2022 dividends: No final dividend is recommended for declaration[37](index=37&type=chunk) Biographical Details of Directors [Biographical Details of Directors](index=9&type=section&id=Biographical%20Details%20of%20Directors) This section provides biographical details for the company's directors, including their age, appointment dates, responsibilities, and extensive experience in the construction and engineering industries - Mr. Kam Kin Pan (Executive Director, Chairman): **65 years old**, appointed Executive Director since July 2017, responsible for daily management and tender bidding, with over **39 years of experience** in the Hong Kong construction industry, holding a Diploma in Civil Engineering since 1982[39](index=39&type=chunk)[40](index=40&type=chunk) - Ms. Wong Mei Chun (Executive Director): **62 years old**, appointed July 28, 2021, with over **25 years of experience** in the construction and electrical engineering industries, specializing in project management, production operations, and financial management[40](index=40&type=chunk) - Independent Non-Executive Directors: Ms. Chan Sin Wah (**43 years old**, appointed July 28, 2021, extensive accounting and auditing experience), Ms. Yip Tan (**30 years old**, appointed August 30, 2022, experience in building design and construction), and Mr. Yu Tat Chi (**57 years old**, appointed September 20, 2021, extensive experience in accounting, corporate finance, and asset management, serving as independent non-executive director for several listed companies)[41](index=41&type=chunk)[42](index=42&type=chunk) Corporate Governance Report [Introduction](index=10&type=section&id=Introduction) The company is committed to achieving and maintaining a high standard of corporate governance, which it believes is crucial for gaining trust from shareholders and stakeholders, effective management, accountability, and transparency to create long-term value - Objective: Achieve and maintain a high standard of corporate governance to build trust, effective management, accountability, and transparency[44](index=44&type=chunk) - Compliance: During the reporting period, the company complied with all applicable code provisions, except for the Chairman and Executive Director Mr. Kam Kin Pan simultaneously overseeing Board management and daily business operations, deviating from code provision A.2.1[46](index=46&type=chunk)[47](index=47&type=chunk) [Board of Directors](index=11&type=section&id=Board%20of%20Directors) The Board is responsible for overseeing all significant company matters and fulfilling corporate governance duties, comprising executive and independent non-executive directors who meet GEM Listing Rules requirements, and despite a deviation from the chairman/CEO separation, the company has adopted a board diversity policy and provides continuous training for directors - Board responsibilities: Oversee company strategy, business performance, financial performance, internal controls, risk management, and corporate governance policies[50](index=50&type=chunk)[51](index=51&type=chunk) - Chairman and Chief Executive roles: Mr. Kam Kin Pan concurrently serves as Chairman and manages daily business operations, deviating from Corporate Governance Code Provision A.2.1, but the Board believes this arrangement enhances management efficiency and business development[53](index=53&type=chunk) - Independent Non-Executive Directors: During the reporting period, there were three independent non-executive directors, comprising over one-third of the Board, all possessing appropriate professional qualifications or experience and confirming their independence[52](index=52&type=chunk) - Board Diversity Policy: Adopted a diversity policy considering factors such as gender, age, cultural background, education, professional experience, skills, and knowledge[56](index=56&type=chunk) - Directors' Continuous Training: All directors participate in continuous professional development to update their knowledge and skills, and are provided with the latest information on relevant laws, regulations, and business developments[59](index=59&type=chunk)[60](index=60&type=chunk) - Directors' Securities Transactions: Directors have confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers under GEM Listing Rules 5.48 to 5.67[61](index=61&type=chunk) [Board Committees](index=15&type=section&id=Board%20Committees) The company has an Audit Committee, Nomination Committee, and Remuneration Committee, each with clear terms of reference and responsibilities, chaired by independent non-executive directors, with the report detailing their composition, main functions, meeting attendance, and director participation during the reporting period - Audit Committee: Responsible for recommending auditor appointment, reviewing financial statements, and monitoring internal control and risk management systems, chaired by Mr. Yu Tat Chi, with all members being independent non-executive directors[63](index=63&type=chunk)[64](index=64&type=chunk) - Nomination Committee: Responsible for reviewing Board structure, identifying director candidates, and assessing the independence of independent non-executive directors, chaired by Ms. Chan Sin Wah[66](index=66&type=chunk)[67](index=67&type=chunk) - Remuneration Committee: Responsible for formulating remuneration policy and reviewing remuneration packages for directors and senior management, chaired by Ms. Chan Sin Wah[68](index=68&type=chunk)[69](index=69&type=chunk) Attendance at Board and Committee Meetings During the Reporting Period | Director Name | Board Meetings | Audit Committee Meetings | Nomination Committee Meetings | Remuneration Committee Meetings | Annual General Meetings | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Kam Kin Pan | 12/12 | N/A | 1/1 | 1/1 | 2/2 | | Ms. Wong Mei Chun | 8/8 | N/A | N/A | N/A | 2/2 | | Ms. Chan Sin Wah | 8/8 | 4/4 | 2/2 | 2/2 | 2/2 | | Mr. Yu Tat Chi | 7/7 | 4/4 | 2/2 | 2/2 | 2/2 | [Directors' and Auditor's Responsibilities for the Consolidated Financial Statements](index=18&type=section&id=Directors'%20and%20Auditor's%20Responsibilities%20for%20the%20Consolidated%20Financial%20Statements) The Board confirms its responsibility to ensure that the consolidated financial statements are prepared truly and fairly in accordance with applicable accounting standards and disclosure requirements, and to maintain proper accounting records and internal controls, while the auditor is responsible for expressing an independent audit opinion on the consolidated financial statements - Directors' responsibilities: Ensure consolidated financial statements are true and fair, comply with the Companies Ordinance and accounting standards, and maintain proper accounting records and internal controls[72](index=72&type=chunk) - Auditor's responsibilities: Express an independent audit opinion on the consolidated financial statements and communicate audit scope, timing, and significant findings to the Audit Committee[72](index=72&type=chunk)[173](index=173&type=chunk) - Auditor's remuneration: For the year ended June 30, 2022, audit service fees payable to Evergreen (HK) Certified Public Accountants Limited were approximately **HK$0.45 million**[73](index=73&type=chunk) [Company Secretary and Compliance Officer](index=19&type=section&id=Company%20Secretary%20and%20Compliance%20Officer) Mr. Li Wai Chi serves as the Company Secretary, assisting the Board in complying with policies and procedures and providing corporate governance advice, while Mr. Kam Kin Pan serves as the Compliance Officer - Company Secretary: Mr. Li Wai Chi, responsible for assisting the Board in complying with policies and procedures and providing corporate governance advice[74](index=74&type=chunk) - Compliance Officer: Mr. Kam Kin Pan[75](index=75&type=chunk) [Corporate Governance Functions](index=19&type=section&id=Corporate%20Governance%20Functions) The company has not established a separate corporate governance committee, with its corporate governance functions performed by the Board, including formulating and reviewing corporate governance policies, codes of conduct, training for directors and senior management, compliance with laws and regulations, and disclosure of corporate governance reports - Function performer: The Board performs corporate governance functions, without a separate committee established[76](index=76&type=chunk) - Key functions: Formulate and review corporate governance policies, codes of conduct, training, compliance with laws and regulations, and report disclosure[76](index=76&type=chunk) [Shareholders' Rights and Communication](index=19&type=section&id=Shareholders'%20Rights%20and%20Communication) The company ensures convenient, equal, and timely access to company information for shareholders and potential investors through various channels, including individual resolutions at general meetings, voting by poll, corporate communications, regular announcements, and the company website, also providing a platform for shareholders to express their views - General meetings: Individual resolutions are proposed, and all resolutions are voted on by poll[77](index=77&type=chunk) - Information disclosure: Information is provided through annual reports, quarterly reports, interim reports, circulars, HKEX announcements, and the company website[82](index=82&type=chunk)[83](index=83&type=chunk) - Communication channels: General meetings provide a platform, the Hong Kong share registrar offers services, and investor suggestions are welcomed[82](index=82&type=chunk) [Risk Management and Internal Control](index=21&type=section&id=Risk%20Management%20and%20Internal%20Control) The Group maintains effective internal control and risk management systems, with the Board reviewing their effectiveness at least annually, and has established risk management procedures including identification, assessment, and mitigation of risks, with the Board believing that sufficient and effective internal control and risk management measures have been implemented - System effectiveness: Maintain effective internal control and risk management systems, reviewed by the Board at least annually[84](index=84&type=chunk) - Risk management procedures: Include risk identification, risk assessment (impact and likelihood), and risk mitigation (control activities)[85](index=85&type=chunk) - Internal audit: Given the relatively simple company structure, no internal audit department has been established at present[85](index=85&type=chunk) [Dividend Policy](index=22&type=section&id=Dividend%20Policy) The company has adopted a dividend policy where the Board will decide on dividend distribution and levels after considering multiple factors, including financial performance, earnings, working capital, business plans, liquidity, and economic conditions, but does not guarantee the payment of any specific amount of dividends - Decision factors: Financial performance, retained earnings, working capital, capital expenditure, future business plans, liquidity position, economic conditions, legal restrictions, etc[87](index=87&type=chunk)[91](index=91&type=chunk) - No guaranteed dividends: The dividend policy does not constitute a legally binding commitment to pay any specific amount of dividends[88](index=88&type=chunk) [Inside Information and Constitutional Documents](index=22&type=section&id=Inside%20Information%20and%20Constitutional%20Documents) The Group complies with the Securities and Futures Ordinance and GEM Listing Rules, ensuring timely disclosure of inside information and maintaining confidentiality, with no significant changes to constitutional documents during the reporting period - Inside information disclosure: Comply with the Securities and Futures Ordinance and GEM Listing Rules, ensuring timely, clear, and balanced disclosure of inside information, and maintaining confidentiality[89](index=89&type=chunk) - Constitutional documents: No significant changes during the reporting period[90](index=90&type=chunk) Directors' Report [Principal Activities and Business Review](index=23&type=section&id=Principal%20Activities%20and%20Business%20Review) The company, as an investment holding company, primarily provides specialized and general building engineering services in Hong Kong through its subsidiaries, including foundation, site formation, demolition, superstructure construction, and renovation, with details of the year's business review available in the Chairman's Report - Company nature: Investment holding company[93](index=93&type=chunk) - Core business: Provides specialized engineering (foundation, site formation, demolition, ground investigation) and general building engineering (superstructure, slope maintenance, hoarding, alteration and addition, renovation) services in Hong Kong[93](index=93&type=chunk) - No significant change in business: No significant change in the nature of principal activities during the year[93](index=93&type=chunk) [Environmental Policies and Compliance with Laws and Regulations](index=23&type=section&id=Environmental%20Policies%20and%20Compliance%20with%20Laws%20and%20Regulations) The company is committed to environmental protection and sustainable development, complying with relevant laws and regulations, and has adopted effective environmental practices, with no significant non-compliance events affecting the Group's operations identified for the year ended June 30, 2022 - Environmental commitment: Committed to environmental protection, pursuing environmental and social sustainable development, and complying with environmental laws and regulations[96](index=96&type=chunk) - Legal compliance: No significant non-compliance with laws and regulations for the year ended June 30, 2022[98](index=98&type=chunk) [Key Risks and Uncertainties](index=24&type=section&id=Key%20Risks%20and%20Uncertainties) The Group's business faces several risks and uncertainties, including project bidding uncertainty, inaccurate cost estimation, reliance on subcontractors, customer credit risk, and the impact of the Hong Kong construction industry and overall economic and political conditions - Project bidding uncertainty: Revenue depends on successful bidding or quotation for non-recurring engineering projects[104](index=104&type=chunk) - Cost estimation risk: Project cost estimates are inaccurate or project delays may lead to cost overruns or losses[104](index=104&type=chunk) - Subcontractor reliance: Reliance on subcontractors, whose poor performance or inadequate services may affect operations and profitability[104](index=104&type=chunk) - Customer credit risk: Customers' failure to pay on time or in full may adversely affect liquidity[104](index=104&type=chunk) - Industry and economic risk: Performance is affected by trends in the Hong Kong construction industry, market conditions, and overall economic and political situations[104](index=104&type=chunk) [Results and Financial Summary](index=24&type=section&id=Results%20and%20Financial%20Summary) The Group recorded a loss for the year ended June 30, 2022, and the Board does not recommend a final dividend, with a summary of past five years' results, assets, and liabilities available on page 91 of the report - Annual results: Recorded a **loss** for the year ended June 30, 2022[100](index=100&type=chunk) - Dividends: No final dividend is recommended for declaration[100](index=100&type=chunk) - Financial summary: A summary of the past five years' results, assets, and liabilities can be found on page 91[101](index=101&type=chunk) [Share Capital and Share Option Scheme](index=24&type=section&id=Share%20Capital%20and%20Share%20Option%20Scheme) Details of the company's share capital are in Note 24, and the share option scheme adopted on December 1, 2017, aims to incentivize employees and directors, with 100,000,000 options granted on October 8, 2021, including 40,000,000 to directors, and their fair value estimated using a binomial option pricing model has been recognized as share-based payment expense - Share capital changes: **200,000,000 shares** were placed on November 16, 2021, raising net proceeds of approximately **HK$8.1 million**. Share consolidation occurred on April 12, 2022, where every ten shares of HK$0.01 each were consolidated into one share of HK$0.1 each[24](index=24&type=chunk)[29](index=29&type=chunk)[84](index=84&type=chunk) - Share option scheme purpose: Attract and retain talent, provide additional incentives, and promote business development[106](index=106&type=chunk) - Share option grants: **100,000,000 share options** were granted on October 8, 2021, with **40,000,000** granted to directors, at an exercise price of **HK$0.056** (HK$0.56 after share consolidation)[115](index=115&type=chunk) - Share option fair value: For the year ended June 30, 2022, the fair value of share options was approximately **HK$3.115 million**, recognized as share-based payment expense[118](index=118&type=chunk) - Unexercised share options: As of the date of this annual report, the total number of shares available for issue is **12,000,000**, representing approximately **10%** of the company's issued share capital on that date[119](index=119&type=chunk) [Reserves and Distributable Reserves](index=28&type=section&id=Reserves%20and%20Distributable%20Reserves) Details of changes in the company's and Group's reserves are provided in Note 33 to the consolidated financial statements and the consolidated statement of changes in equity, and as of June 30, 2022, the company had no distributable reserves - Reserve changes: Details are provided in Note 33 to the consolidated financial statements and the consolidated statement of changes in equity[120](index=120&type=chunk) - Distributable reserves: As of June 30, 2022, the company had no distributable reserves[123](index=123&type=chunk) [Major Customers and Suppliers](index=28&type=section&id=Major%20Customers%20and%20Suppliers) For the year ended June 30, 2022, the Group's customer and supplier concentration decreased, but the top five customers and suppliers still accounted for a significant portion of revenue and purchases Major Customer and Supplier Concentration in FY2022 | Metric | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Revenue from Largest Customer | 18.2% | 59.7% | | Revenue from Top Five Customers | 58.7% | 97.1% | | Purchases from Largest Supplier | 19.9% | 40.9% | | Purchases from Top Five Suppliers | 58.7% | 68.6% | - Related party interests: No directors, their close associates, or shareholders holding more than 5% of the shares held beneficial interests in the top five customers or suppliers[124](index=124&type=chunk) [Relationship with Customers, Suppliers, Subcontractors, Employees and Shareholders](index=29&type=section&id=Relationship%20with%20Customers,%20Suppliers,%20Subcontractors,%20Employees%20and%20Shareholders) The Group's success relies on the support of various stakeholders, with the company committed to maintaining good relationships with customers through ISO 9001 quality management, fostering long-term cooperation with suppliers and subcontractors, valuing employees with competitive remuneration and training, and aiming to enhance shareholder returns - Customer relationships: Emphasize timely delivery, maintain ISO 9001 quality management system, regularly communicate, and foster good business relationships[126](index=126&type=chunk) - Supplier and subcontractor relationships: Maintain good business relationships, have an internal approved list, evaluate multiple factors for partner selection, and had no significant disputes during the year[127](index=127&type=chunk)[128](index=128&type=chunk) - Employee relationships: Value employee talent, provide a good working environment, competitive remuneration, and training, maintaining good relationships[129](index=129&type=chunk) - Shareholder relationships: Aim to enhance shareholder returns by developing core businesses for sustainable profitable growth and considering dividend payouts to shareholders[130](index=130&type=chunk) [Directors and Senior Management](index=30&type=section&id=Directors%20and%20Senior%20Management) This report lists the Board members as of the report date and explains the rotation and re-election mechanism for directors, with the Nomination Committee responsible for nominating and selecting director candidates and ensuring board diversity, and the company has arranged liability insurance for directors and senior officers, also disclosing the remuneration range for senior management - Board members: As of the report date, Board members include executive directors Mr. Kam Kin Pan and Ms. Wong Mei Chun, and independent non-executive directors Ms. Chan Sin Wah, Ms. Yip Tan, and Mr. Yu Tat Chi[131](index=131&type=chunk) - Directors' rotation: One-third of directors retire by rotation annually and are eligible for re-election, with each director retiring at least once every three years[131](index=131&type=chunk) - Independence confirmation: Ms. Chan Sin Wah and Ms. Yip Tan meet the independence criteria of the GEM Listing Rules and are considered independent of the Group by the Board[133](index=133&type=chunk) - Indemnity provisions: Directors are entitled to be indemnified by the company for losses or liabilities incurred as directors, and the company has arranged directors' and officers' liability insurance[134](index=134&type=chunk) Senior Management Remuneration Range in FY2022 | Remuneration Range | Number of Individuals | | :--- | :--- | | HK$1,000,000 or below | 4 | | HK$1,000,001 to HK$2,000,000 | 1 | | Above HK$2,000,000 | – | - Remuneration policy: Remuneration includes a fixed component (basic salary) and a variable component (discretionary bonuses and other incentives), considering experience, responsibilities, performance, Group profit, and market conditions[139](index=139&type=chunk) [Disclosure of Directors' Interests and Other Matters](index=32&type=section&id=Disclosure%20of%20Directors'%20Interests%20and%20Other%20Matters) The report discloses the interests of directors and chief executives in the company's shares or related shares, as well as major shareholders' holdings, confirms that the company has maintained sufficient public float, mentions the change of auditors, and confirms that directors are unaware of any conflicts of interest Directors' Long Positions in Shares or Related Shares as of June 30, 2022 | Director Name | Capacity | Number of Unlisted Share Options | Percentage of Total Issued Share Capital of the Company | | :--- | :--- | :--- | :--- | | Mr. Kam Kin Pan | Beneficial Owner | 1,000,000 | 0.83% | | Ms. Wong Mei Chun | Beneficial Owner | 1,000,000 | 0.83% | | Ms. Chan Sin Wah | Beneficial Owner | 1,000,000 | 0.83% | | Mr. Yu Tat Chi | Beneficial Owner | 1,000,000 | 0.83% | Major Shareholders' Long Positions in Shares as of June 30, 2022 | Shareholder Name | Capacity | Number of Shares Held/Interested | Approximate Percentage of Total Issued Share Capital of the Company | | :--- | :--- | :--- | :--- | | Ms. Zhao Xuemei | Beneficial Owner | 8,999,000 | 7.49% | - Public float: For the year ended June 30, 2022, and up to the date of this report, the company maintained the minimum public float required by the GEM Listing Rules[147](index=147&type=chunk) - Auditor change: PricewaterhouseCoopers resigned on July 9, 2020, and Grant Thornton took over; Grant Thornton resigned on July 12, 2022, and Evergreen took over[148](index=148&type=chunk) - Conflicts of interest: Directors are unaware of any business or interest that directly or indirectly competes with the Group's business[149](index=149&type=chunk) Independent Auditor's Report [Independent Auditor's Report](index=35&type=section&id=Independent%20Auditor's%20Report) Independent auditor Evergreen (HK) Certified Public Accountants Limited issued an unmodified opinion on the consolidated financial statements for the year ended June 30, 2022, which were prepared in accordance with Hong Kong Financial Reporting Standards and the Hong Kong Companies Ordinance, highlighting key audit matters related to revenue recognition and expected credit loss provisions - Audit opinion: Independent auditor Evergreen (HK) Certified Public Accountants Limited issued an **unmodified opinion** on the consolidated financial statements for the year ended June 30, 2022[156](index=156&type=chunk) - Basis of preparation: Consolidated financial statements were properly prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants and the disclosure requirements of the Hong Kong Companies Ordinance[156](index=156&type=chunk) - Key audit matters: 1. Revenue recognition for construction contracts (involving significant management estimates and judgments on the value of work completed); 2. Expected credit loss provisions for trade receivables and contract assets (involving significant judgment and complexity)[158](index=158&type=chunk)[161](index=161&type=chunk)[163](index=163&type=chunk) - Directors' responsibilities: Directors are responsible for preparing consolidated financial statements that give a true and fair view in accordance with Hong Kong Financial Reporting Standards and the Companies Ordinance, and for internal controls[169](index=169&type=chunk) - Auditor's responsibilities: The objective is to obtain reasonable assurance that the consolidated financial statements are free from material misstatement and to communicate audit findings to the Audit Committee[171](index=171&type=chunk)[173](index=173&type=chunk) Consolidated Statement of Profit or Loss and Other Comprehensive Income [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=41&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The consolidated statement of profit or loss and other comprehensive income for FY2022 shows a significant increase in revenue and gross profit, but also a substantial rise in administrative expenses, impairment losses, and expected credit loss provisions, leading to an expanded net loss attributable to owners of the company and an increased basic loss per share Key Data from Consolidated Statement of Profit or Loss and Other Comprehensive Income in FY2022 | Metric (HK$ thousand) | 2022 | 2021 (Restated) | Change | | :--- | :--- | :--- | :--- | | Revenue | 65,331 | 33,826 | **Increased by 93.1%** | | Cost of Sales | (57,124) | (31,702) | **Increased by 80.2%** | | Gross Profit | 8,207 | 2,124 | **Increased by 286.4%** | | Other Income | 215 | 737 | **Decreased by 70.8%** | | Administrative Expenses | (12,849) | (8,533) | **Increased by 50.6%** | | Finance Costs | (51) | (41) | **Increased by 24.4%** | | Impairment Loss on Property, Plant and Equipment | (1,164) | (113) | **Increased by 930.1%** | | Impairment Loss on Right-of-Use Assets | (334) | (706) | **Decreased by 52.7%** | | Provision for Expected Credit Losses | (2,972) | 60 | **Turned from reversal to provision** | | Loss Before Tax | (8,948) | (6,472) | **Loss expanded by 38.3%** | | Loss and Total Comprehensive Loss Attributable to Owners of the Company for the Year | (8,948) | (7,396) | **Loss expanded by 20.9%** | | Basic Loss Per Share (HK cents) | (8.0) | (7.4) | **Loss expanded by 8.1%** | Consolidated Statement of Financial Position [Consolidated Statement of Financial Position](index=42&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) The consolidated statement of financial position as of June 30, 2022, shows significant increases in trade receivables and contract assets, a decrease in cash and cash equivalents, and an overall increase in net assets and total equity Key Data from Consolidated Statement of Financial Position in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | Change | | :--- | :--- | :--- | :--- | | **Non-Current Assets** | | | | | Property, Plant and Equipment | 71 | – | **Significantly increased** | | Right-of-Use Assets | 602 | – | **Significantly increased** | | **Current Assets** | | | | | Trade Receivables | 18,747 | 271 | **Increased by 6814%** | | Contract Assets | 17,433 | 12,301 | **Increased by 41.7%** | | Cash and Cash Equivalents | 30,710 | 49,447 | **Decreased by 37.9%** | | **Current Liabilities** | | | | | Trade Payables and Retention Payables | 6,400 | 5,094 | **Increased by 25.6%** | | **Net Assets** | 59,748 | 57,445 | **Increased by 4.0%** | | **Total Equity** | 59,748 | 57,445 | **Increased by 4.0%** | Consolidated Statement of Changes in Equity [Consolidated Statement of Changes in Equity](index=44&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) The consolidated statement of changes in equity for FY2022 reflects an increase in share capital and share premium due to share placement, the recognition of a new share option reserve from share-based payments, and an expansion of accumulated losses, resulting in an overall increase in total equity Key Data from Consolidated Statement of Changes in Equity in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | Change | | :--- | :--- | :--- | :--- | | Share Capital | 12,000 | 10,000 | **Increased by 20%** | | Share Premium | 42,991 | 36,855 | **Increased by 16.6%** | | Share Option Reserve | 3,115 | – | **Newly recognized** | | Retained Earnings/(Accumulated Losses) | (8,458) | 490 | **Turned from earnings to losses** | | **Total Equity** | **59,748** | **57,445** | **Increased by 4.0%** | - Share-based payment expense: **HK$3,115 thousand** in share-based payment expense was recognized[183](index=183&type=chunk) - Share placement: Share placement resulted in an increase in share capital of **HK$2,000 thousand** and share premium of **HK$6,136 thousand**[183](index=183&type=chunk) - Loss for the year: Loss and total comprehensive loss for the year amounted to **HK$8,948 thousand**[183](index=183&type=chunk) Consolidated Statement of Cash Flows [Consolidated Statement of Cash Flows](index=45&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) The consolidated statement of cash flows for FY2022 shows a significant shift from net cash inflow to outflow from operating activities, increased outflow from investing activities, and a shift from outflow to inflow from financing activities, resulting in a net decrease in cash and cash equivalents by year-end Key Data from Consolidated Statement of Cash Flows in FY2022 | Metric (HK$ thousand) | 2022 | 2021 | Change | | :--- | :--- | :--- | :--- | | Net Cash From/(Used in) Operating Activities | (24,489) | 12,080 | **Shifted from inflow to outflow** | | Net Cash (Used in)/From Investing Activities | (1,676) | 62 | **Outflow increased** | | Net Cash From/(Used in) Financing Activities | 7,428 | (691) | **Shifted from outflow to inflow** | | (Decrease)/Increase in Cash and Cash Equivalents | (18,737) | 11,451 | **Shifted from increase to decrease** | | Cash and Cash Equivalents at Year-End | 30,710 | 49,447 | **Decreased by 37.9%** | - Operating activities cash outflow reasons: Primarily affected by loss before tax and increases in trade receivables and contract assets[187](index=187&type=chunk) - Financing activities cash inflow reasons: Primarily from proceeds of share placement amounting to **HK$8,136 thousand**[187](index=187&type=chunk) Notes to the Consolidated Financial Statements [General Information](index=46&type=section&id=General%20Information) WT Group Holdings Limited was incorporated in the Cayman Islands as an exempted company on July 11, 2017, primarily engaged in investment holding and providing specialized and general building engineering services in Hong Kong through its subsidiaries, with its shares listed on GEM of the Stock Exchange on December 28, 2017 - Registration information: Incorporated in the Cayman Islands as an exempted company on **July 11, 2017**[189](index=189&type=chunk) - Principal activities: Investment holding, providing specialized and general building engineering services in Hong Kong through subsidiaries[190](index=190&type=chunk) - Listing information: Listed on GEM of the Stock Exchange on **December 28, 2017**[191](index=191&type=chunk) [Basis of Preparation and Adoption of New and Revised Hong Kong Financial Reporting Standards](index=46&type=section&id=Basis%20of%20Preparation%20and%20Adoption%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The consolidated financial statements are prepared in accordance with all applicable Hong Kong Financial Reporting Standards issued by the HKICPA and comply with GEM Listing Rules and the Hong Kong Companies Ordinance, with new and revised standards adopted this year having no significant impact on financial position or performance - Basis of preparation: Prepared in accordance with Hong Kong Financial Reporting Standards issued by the HKICPA, GEM Listing Rules, and the Hong Kong Companies Ordinance[192](index=192&type=chunk) - Impact of new standards: New and revised Hong Kong Financial Reporting Standards applied this year had **no significant impact** on financial position or performance[194](index=194&type=chunk) - Assessment of future standards: Currently assessing new standards issued but not yet effective, which are not expected to have a significant impact on the consolidated financial statements[197](index=197&type=chunk) [Significant Accounting Policies](index=48&type=section&id=Significant%20Accounting%20Policies) This section details the significant accounting policies adopted by the Group in preparing the consolidated financial statements, including consolidation, foreign currency translation, property, plant and equipment, leases, contract assets and liabilities, revenue recognition for construction contracts, financial instruments, employee benefits, share-based payments, taxation, and impairment of assets, providing a foundation for understanding the financial statements - Consolidation: Subsidiaries are consolidated from the date control is transferred, with intercompany transactions, balances, and unrealized profits eliminated[201](index=201&type=chunk)[202](index=202&type=chunk) - Property, plant and equipment: Recognized at cost less accumulated depreciation and impairment losses, with depreciation calculated using the straight-line method[206](index=206&type=chunk) - Leases (Lessee): Right-of-use assets and lease liabilities are recognized, except for short-term leases and leases of low-value assets. Right-of-use assets are measured at cost less accumulated depreciation and impairment losses[208](index=208&type=chunk)[209](index=209&type=chunk) - Revenue recognition for construction contracts: Revenue is recognized over time using the output method, based on the value of work completed and certified, adjusted for uncertified estimated work value[216](index=216&type=chunk) - Impairment of financial assets and contract assets: Expected credit loss provisions are recognized, with trade receivables and contract assets measured using the simplified approach (lifetime expected credit losses)[248](index=248&type=chunk) - Share-based payments: Equity-settled share-based payments are measured at fair value at the grant date and expensed over the vesting period[237](index=237&type=chunk) [Critical Judgements and Key Estimates](index=62&type=section&id=Critical%20Judgements%20and%20Key%20Estimates) This section discloses management's critical judgments and key estimates made in applying accounting policies, which significantly impact the amounts recognized in the consolidated financial statements, including assessing significant increases in credit risk, estimating revenue and profit recognition for construction contracts, evaluating impairment of property, plant and equipment and right-of-use assets, and valuing impairment of trade receivables, contract assets, and share-based payment transactions - Significant increase in credit risk: When assessing whether the credit risk of financial instruments has significantly increased, reasonable and supportable qualitative and quantitative forward-looking information is considered[265](index=265&type=chunk) - Revenue and profit recognition for construction contracts: Revenue recognition is based on certified work measurements and estimates of uncertified work value[267](index=267&type=chunk) - Asset impairment: When assessing impairment of property, plant and equipment and right-of-use assets, judgments are required regarding indicators of events, recoverable amounts (value in use), and key assumptions (cash flow forecasts, discount rates)[269](index=269&type=chunk) - Impairment of trade receivables and contract assets: Expected credit loss amounts are estimated based on the difference between contractual cash flows and expected cash flows, discounted at the original effective interest rate[270](index=270&type=chunk) - Share-based payment valuation: The fair value of share options is valued using a binomial option pricing model, involving key input data such as dividend yield, expected volatility, risk-free interest rate, and expected option life[271](index=271&type=chunk) [Financial Risk Management](index=64&type=section&id=Financial%20Risk%20Management) The Group's financial risk management program aims to mitigate potential adverse effects of foreign currency risk, credit risk, liquidity risk, and interest rate risk on financial performance, with the report detailing strategies for managing each risk, including customer credit risk assessment, expected credit loss provisions for trade receivables and contract assets, regular monitoring of liquidity needs, and the limited impact of interest rate risk - Foreign currency risk: **Minimal**, as most transactions are denominated in HKD, and no foreign currency hedging policy has been adopted[275](index=275&type=chunk) - Credit risk: Primarily arises from trade receivables and contract assets, managed through customer credit assessment and expected credit loss provisions[276](index=276&type=chunk)[278](index=278&type=chunk) Expected Credit Loss Provisions for Trade Receivables and Contract Assets as of June 30, 2022 | Metric | June 30, 2022 (HK$ thousand) | | :--- | :--- | | Provision for Trade Receivables | 3,084 | | Provision for Contract Assets | 579 | - Liquidity risk: Regularly monitored to ensure sufficient cash reserves are maintained[289](index=289&type=chunk) - Interest rate risk: Lease liabilities bear interest at fixed rates, other interest-bearing assets and liabilities are not significant, and income and operating cash flows are generally unaffected by market interest rate changes[292](index=292&type=chunk) [Segment Information](index=70&type=section&id=Segment%20Information) The Group's primary operating decision-maker assesses all businesses as a single operating segment for evaluation and resource allocation, thus no operating segment information is presented, with all activities and revenue derived from external customers in Hong Kong - Operating segments: All businesses are considered a **single operating segment**, and no separate segment information is presented[297](index=297&type=chunk) - Geographical information: All activities and revenue are derived from Hong Kong[298](index=298&type=chunk) - Customer concentration: For the year ended June 30, 2022, revenue from **2 customers** each accounted for **over 10%** of total revenue[298](index=298&type=chunk) [Revenue and Other Income](index=70&type=section&id=Revenue%20and%20Other%20Income) For the year ended June 30, 2022, the Group's revenue primarily came from construction contracts, with contract revenue recognized over time amounting to HK$65,331 thousand, while other income mainly included government grants and sundry income, with government grants decreasing due to COVID-19 related subsidies Revenue and Other Income in FY2022 | Metric (HK$ thousand) | 2022 | 2021 | | :--- | :--- | :--- | | Contract Revenue | 65,331 | 33,826 | | Government Grants | 192 | 672 | | Sundry Income | 23 | 65 | | **Total Other Income** | **215** | **737** | - Revenue source: Primarily construction contract revenue, recognized over time[299](index=299&type=chunk) - Government grants: Primarily related to COVID-19 employment support schemes[301](index=301&type=chunk) [Finance Costs and Loss Before Tax](index=71&type=section&id=Finance%20Costs%20and%20Loss%20Before%20Tax) For the year ended June 30, 2022, the Group's finance costs primarily consisted of interest expense on lease liabilities, amounting to HK$51 thousand, and the loss before tax was HK$8,948 thousand, mainly influenced by construction costs, administrative expenses (including share-based payment expenses), asset depreciation and impairment losses, and expected credit loss provisions Key Data for Finance Costs and Loss Before Tax in FY2022 | Metric (HK$ thousand) | 2022 | 2021 | | :--- | :--- | :--- | | Interest Expense on Lease Liabilities | 51 | 41 | | Loss Before Tax | (8,948) | (6,472) | | Construction Costs | 57,124 | 31,702 | | Employee Benefit Expenses (including Directors' Emoluments) | 7,572 | 4,092 | | Share-Based Payment Expenses | 3,115 | – | | Impairment Loss on Property, Plant and Equipment | 1,164 | 113 | | Provision for Expected Credit Losses | 2,972 | (60) | [Directors' and Chief Executive's Emoluments](index=73&type=section&id=Directors'%20and%20Chief%20Executive's%20Emoluments) This section details the remuneration components for directors and chief executives for the year ended June 30, 2022, including fees, salaries, discretionary bonuses, allowances and benefits in kind, employer's contributions to pension schemes, and share-based payments, with total emoluments amounting to HK$4,850 thousand, of which HK$1,304 thousand was from share-based payments Directors' and Chief Executive's Emoluments in FY2022 | Emolument Type (HK$ thousand) | 2022 | 2021 | | :--- | :--- | :--- | | Fees | 486 | 540 | | Salaries | 2,424 | 2,539 | | Discretionary Bonuses | 325 | 233 | | Allowances and Benefits in Kind | 284 | 301 | | Employer's Contributions to Pension Schemes | 27 | 41 | | Share-Based Payments | 1,304 | – | | **Total** | **4,850** | **3,654** | - Remuneration determination: Determined by the Remuneration Committee after considering performance and market trends[313](index=313&type=chunk) - No additional emoluments: No directors received rewards for joining the Group or compensation for loss of office during the year[311](index=311&type=chunk) [Income Tax Expense](index=75&type=section&id=Income%20Tax%20Expense) For the year ended June 30, 2022, the Group recognized no income tax expense, compared to HK$924 thousand in 2021, as Hong Kong profits tax is levied under a two-tiered system, but no provision was made due to the absence of assessable profits or sufficient tax losses to offset for the Group's Hong Kong entities Income Tax Expense in FY2022 | Metric (HK$ thousand) | 2022 | 2021 | | :--- | :--- | :--- | | Income Tax Expense | – | 924 | - Hong Kong Profits Tax: Profits up to **HK$2,000,000** are taxed at **8.25%**, and profits exceeding this amount are taxed at **16.5%**[314](index=314&type=chunk) - Reason for no provision: Hong Kong entities had no assessable profits or sufficient tax losses to carry forward[314](index=314&type=chunk) - Tax differences: The difference between the theoretical tax amount on loss before tax and actual income tax expense primarily arises from non-deductible expenses, non-taxable income, unrecognized tax losses, and utilized unrecognized tax losses[317](index=317&type=chunk) [Loss Per Share](index=76&type=section&id=Loss%20Per%20Share) For the year ended June 30, 2022, the basic loss per share attributable to owners of the company was 8.0 HK cents, an increase from 7.4 HK cents in 2021, and diluted loss per share is not presented as share options would not result in a diluted loss per share Loss Per Share in FY2022 | Metric | 2022 | 2021 (Restated) | | :--- | :--- | :--- | | Loss Attributable to Owners of the Company (HK$ thousand) | (8,948) | (7,396) | | Weighted Average Number of Ordinary Shares for Basic and Diluted Loss Per Share (thousand shares) | 111,475 | 100,000 | | **Basic Loss Per Share (HK cents)** | **(8.0)** | **(7.4)** | - Diluted loss: Unexercised share options would not result in a diluted loss per share for the year ended June 30, 2022[320](index=320&type=chunk) - 2021 restatement: The weighted average number of ordinary shares for basic loss per share in 2021 has been adjusted to reflect the impact of the share consolidation[320](index=320&type=chunk) [Property, Plant and Equipment and Right-of-Use Assets](index=77&type=section&id=Property,%20Plant%20and%20Equipment%20and%20Right-of-Use%20Assets) As of June 30, 2022, the net book value of property, plant and equipment was HK$71 thousand, and right-of-use assets was HK$602 thousand, with additions of HK$1,676 thousand and HK$1,209 thousand respectively during the year, and impairment losses of HK$1,164 thousand for property, plant and equipment and HK$334 thousand for right-of-use assets were recognized due to impairment assessment Net Book Value of Property, Plant and Equipment and Right-of-Use Assets in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Net Book Value of Property, Plant and Equipment | 71 | – | | Net Book Value of Right-of-Use Assets | 602 | – | - Additions during the year: Property, plant and equipment additions of **HK$1,676 thousand**, and right-of-use asset additions of **HK$1,209 thousand**[321](index=321&type=chunk)[324](index=324&type=chunk) - Impairment losses: Impairment loss on property, plant and equipment of **HK$1,164 thousand**, and impairment loss on right-of-use assets of **HK$334 thousand**[321](index=321&type=chunk)[322](index=322&type=chunk)[324](index=324&type=chunk) - Impairment assessment: Based on the value in use of the renovation works cash-generating unit, using a **5-year financial budget** and a **pre-tax discount rate of 13%**[321](index=321&type=chunk) [Trade Receivables and Contract Assets](index=79&type=section&id=Trade%20Receivables%20and%20Contract%20Assets) As of June 30, 2022, net trade receivables amounted to HK$18,747 thousand and net contract assets to HK$17,433 thousand, with trade receivables having a credit period of 30 to 60 days, and contract assets primarily comprising uncertified work in progress and retention receivables, for which the Group has made corresponding expected credit loss provisions Trade Receivables and Contract Assets in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Gross Trade Receivables | 21,831 | 651 | | Less: Provision for Expected Credit Losses | (3,084) | (380) | | **Net Trade Receivables** | **18,747** | **271** | | Gross Contract Assets | 18,012 | 12,636 | | Less: Provision for Expected Credit Losses | (579) | (335) | | **Net Contract Assets** | **17,433** | **12,301** | - Trade receivables aging: As of June 30, 2022, trade receivables overdue for **more than 1 year** amounted to **HK$715 thousand**[328](index=328&type=chunk) - Contract assets composition: Uncertified work in progress of **HK$7,214 thousand** and retention receivables of **HK$10,798 thousand**[330](index=330&type=chunk) - Increase in contract assets: The increase in 2022 was primarily due to an increase in uncertified construction services[332](index=332&type=chunk) [Deposits, Prepayments and Other Receivables](index=81&type=section&id=Deposits,%20Prepayments%20and%20Other%20Receivables) As of June 30, 2022, net deposits, prepayments, and other receivables amounted to HK$1,319 thousand, with a non-current portion of HK$45 thousand, and the Group has made an expected credit loss provision of HK$53 thousand for these items Deposits, Prepayments and Other Receivables in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Deposits and Other Receivables | 1,043 | 1,130 | | Prepayments | 329 | 120 | | Less: Provision for Expected Credit Losses | (53) | (29) | | **Net Amount** | **1,319** | **1,221** | | Non-Current Portion | (45) | (68) | [Restricted Cash and Cash and Cash Equivalents](index=82&type=section&id=Restricted%20Cash%20and%20Cash%20and%20Cash%20Equivalents) As of June 30, 2022, restricted cash amounted to HK$748 thousand, primarily pledged as collateral for performance guarantees, and cash and cash equivalents were HK$30,710 thousand, a decrease from the previous year Restricted Cash and Cash and Cash Equivalents in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Restricted Cash | 748 | 2,100 | | Cash and Cash Equivalents | 30,710 | 49,447 | - Restricted cash usage: Pledged as collateral for performance guarantees with an insurance company, non-interest bearing[336](index=336&type=chunk) [Trade Payables and Retention Payables](index=82&type=section&id=Trade%20Payables%20and%20Retention%20Payables) As of June 30, 2022, total trade payables and retention payables amounted to HK$6,400 thousand, with trade payables generally having an average credit period of 30 days Trade Payables and Retention Payables in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Trade Payables | 3,544 | 2,881 | | Retention Payables | 2,856 | 2,213 | | **Total** | **6,400** | **5,094** | - Credit period: Average credit period for trade payables is **30 days**[338](index=338&type=chunk) - Long-term retention payables: Retention payables expected to be settled after **12 months** amounted to approximately **HK$1,775 thousand**[339](index=339&type=chunk) [Accruals and Other Payables](index=83&type=section&id=Accruals%20and%20Other%20Payables) As of June 30, 2022, total accruals and other payables amounted to HK$2,432 thousand, primarily comprising accrued legal and professional fees and other accrued expenses Accruals and Other Payables in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Accrued Legal and Professional Fees | 712 | 1,016 | | Other Accrued Expenses and Other Payables | 1,720 | 1,261 | | **Total** | **2,432** | **2,277** | [Lease Liabilities](index=83&type=section&id=Lease%20Liabilities) As of June 30, 2022, the present value of lease liabilities was HK$1,050 thousand, mainly comprising leased properties, with these liabilities bearing interest at fixed rates ranging from 2.5% to 7.3% per annum Present Value of Lease Liabilities in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Present Value of Lease Liabilities | 1,050 | 679 | | Due within 1 year | (726) | (528) | | Due after 1 year | 324 | 151 | - Composition: Primarily leased properties, with some hire-purchase vehicles[341](index=341&type=chunk) - Interest rate: Incremental borrowing interest rates range from **2.5% to 7.3%** per annum[341](index=341&type=chunk) [Share Capital and Dividends](index=84&type=section&id=Share%20Capital%20and%20Dividends) As of June 30, 2022, the company's issued share capital was HK$12,000 thousand, with shares issued through placement and a share consolidation during the year, and the Group's capital management objective is to safeguard its ability to continue as a going concern and optimize shareholder returns, with no dividends paid or declared for the year ended June 30, 2022 Share Capital in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Authorized Share Capital | 50,000 | 50,000 | | Issued and Fully Paid Share Capital | 12,000 | 10,000 | - Placement: **200,000,000 shares** were placed on November 16, 2021, with net proceeds of approximately **HK$8,100 thousand**[342](index=342&type=chunk) - Share consolidation: Became effective on April 12, 2022, where every ten shares of HK$0.01 each were consolidated into one share of HK$0.1 each[343](index=343&type=chunk) - Capital management objective: Safeguard the ability to continue as a going concern and maximize returns to shareholders through optimizing the debt and equity balance[343](index=343&type=chunk) - Dividends: No dividends were paid or declared for the year ended June 30, 2022[344](index=344&type=chunk) [Deferred Taxation](index=85&type=section&id=Deferred%20Taxation) As of June 30, 2022, the Group's net deferred tax assets/liabilities were zero, and while the Group has unutilized tax losses of approximately HK$13,628 thousand, no deferred tax assets were recognized due to the unpredictability of future profit sources - Net deferred tax: **Zero** as of June 30, 2022[345](index=345&type=chunk) - Unutilized tax losses: Approximately **HK$13,628 thousand** (2021: HK$12,287 thousand), available to offset future profits[346](index=346&type=chunk) - Unrecognized deferred tax assets: No deferred tax assets were recognized for unutilized tax losses due to the unpredictability of future profit sources[346](index=346&type=chunk) [Share Option Scheme](index=86&type=section&id=Share%20Option%20Scheme) The company adopted a share option scheme on December 1, 2017, to incentivize employees, and on October 8, 2021, granted 100,000,000 share options to directors and employees with an exercise price of HK$0.056 (HK$0.56 after share consolidation) and an expiry date of October 7, 2023, with the fair value calculated using a binomial pricing model and recognized as HK$3,115 thousand in share-based payment expense - Scheme purpose: Attract and retain talent, provide additional incentives, and promote business development[347](index=347&type=chunk) - Grant details: **100,000,000 share options** granted on October 8, 2021, with **40,000,000** to directors and **60,000,000** to employees[348](index=348&type=chunk) - Exercise price and term: Exercise price of **HK$0.056** before share consolidation, **HK$0.56** after consolidation, with an exercise period until **October 7, 2023**[348](index=348&type=chunk) - Fair value and expense: Fair value of share options approximately **HK$3,115 thousand**, recognized as share-based payment expense for the year ended June 30, 2022[349](index=349&type=chunk)[350](index=350&type=chunk) - Unexercised share options: As of the end of the reporting period, **10,000,000 share options** remained unexercised[350](index=350&type=chunk) [Related Party Transactions](index=88&type=section&id=Related%20Party%20Transactions) This section discloses key management personnel compensation as related party transactions, with total key management personnel compensation amounting to HK$4,850 thousand for the year ended June 30, 2022, including HK$1,304 thousand in share-based payments Key Management Personnel Compensation in FY2022 | Metric (HK$ thousand) | 2022 | 2021 | | :--- | :--- | :--- | | Salaries, Bonuses, Other Allowances and Benefits in Kind | 3,519 | 3,613 | | Retirement Benefit Costs – Defined Contribution Plans | 27 | 41 | | Equity-Settled Share-Based Payments | 1,304 | – | | **Total** | **4,850** | **3,654** | [Reconciliation of Liabilities Arising from Financing Activities](index=88&type=section&id=Reconciliation%20of%20Liabilities%20Arising%20from%20Financing%20Activities) This section provides a reconciliation of changes in lease liabilities during the reporting period, including the impact of financing cash flows, new leases, terminated leases, and interest expense, with total lease liabilities amounting to HK$1,050 thousand as of June 30, 2022 Reconciliation of Lease Liabilities in FY2022 | Metric (HK$ thousand) | June 30, 2022 | June 30, 2021 | | :--- | :--- | :--- | | Lease Liabilities at Beginning of Year | 679 | 630 | | Financing Cash Flows | (708) | (691) | | New Leases | 1,209 | 783 | | Terminated Leases | (181) | – | | Interest Expense | 51 | 41 | | **Lease Liabilities at End of Year** | **1,050** | **679** | [Principal Subsidiaries](index=89&type=section&id=Principal%20Subsidiaries) The company's principal subsidiaries include Vision Perfect Ventures Limited and Hong Yun Holdings Limited (investment holding), as well as Victor Foundation Engineering Limited (foundation and building engineering) and Million Ocean Development Limited (interior fitting-out and alteration works), all of which are wholly-owned - Directly held: Vision Perfect Ventures Limited (British Virgin Islands, investment holding), Hong Yun Holdings Limited (British Virgin Islands, investment holding)[355](index=355&type=chunk) - Indirectly held: Victor Foundation Engineering Limited (Hong Kong, foundation and building engineering), Million Ocean Development Limited (Hong Kong, interior fitting-out and alteration works)[355](index=355&type=chunk) - Ownership percentage: All principal subsidiaries are **wholly-owned (100%)** by the company[355](index=355&type=chunk) [Non-Cash Transactions and Contingent Liabilities](index=89&type=section&id=Non-Cash%20Transactions%20and%20Contingent%20Liabilities) During the year, the Group entered into new lease agreements, recognizing HK$1,209 thousand each in right-of-use assets and lease liabilities, and as of June 30, 2022, provided performance guarantees of approximately HK$2,552 thousand for construction contracts, with directors believing the likelihood of claims from customers to be low - Non-cash transactions: New lease agreements resu

第三季度業績報告 THIRD QUARTERLY REPORT 香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM乃為較其他於聯交所上市之公司帶有較高投資風險之中小型公司提供一個上市之市場。 有意投資者應了解投資於該等公司之潛在風險，並應經過審慎周詳考慮後方作出投資決定。 鑑於GEM 上市公司普遍為中小型公司，於GEM 買賣之證券可能會較於聯交所主板買賣之證 券承受較大之市場波動風險，及無法保證於GEM買賣之證券會有高流通市場。 香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整性亦不 發表任何聲明，並明確表示概不對因本報告全部或任何部分內容而產生或因倚賴該等內容 而引致之任何損失承擔任何責任。 本報告乃遵照聯交所《GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供有關WT集 團控股有限公司（「本公司」，連同其附屬公司稱為「本集團」）的資料；本公司董事（「董事」） 願就本報告的資料共同及個別地承擔全部責任。各董事在作出一切合理查詢後，確認就其所 知及所信，本報告所載資料在各重要方面均屬準確完備，沒有誤導或欺詐成分，及並無遺漏 任何其他事項，致使本報告或其所載任何陳述產生誤導 ...

[Financial Performance](index=3&type=section&id=%E8%B2%A1%E5%8B%99%E6%A5%AD%E7%B8%BE) This section provides a comprehensive overview of the Group's financial performance, including key financial statements and their respective analyses [Unaudited Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended December 31, 2021, the Group's revenue significantly increased, but the loss for the period expanded due to increased share-based payment expenses Unaudited Condensed Consolidated Statement of Comprehensive Income Summary | Metric | Six Months Ended December 31, 2021 (thousand HKD) | Six Months Ended December 31, 2020 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 28,851 | 12,212 | 136.2% | | Gross Profit/(Loss) | 1,426 | (756) | N/A (Turned from loss to profit) | | Loss Before Income Tax | (6,161) | (3,811) | 61.7% (Loss widened) | | Loss and Total Comprehensive Loss Attributable to Owners of the Company | (6,161) | (3,775) | 63.2% (Loss widened) | | Basic and Diluted Loss Per Share (HK cents) | (0.60) | (0.38) | 57.9% (Loss increased) | [Unaudited Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of December 31, 2021, the Group's net current assets and total equity both increased, indicating an improved financial position Unaudited Condensed Consolidated Statement of Financial Position Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Net Current Assets | 62,522 | 57,528 | 8.7% | | Total Equity | 62,546 | 57,445 | 8.9% | | Trade and Project Retention Receivables, Net | 10,181 | 271 | 3651.3% | | Cash and Cash Equivalents | 36,349 | 49,447 | -26.5% | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=6&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) For the six months ended December 31, 2021, total equity increased to **HKD 62.55 million**, primarily driven by share placement and share-based payment expenses, despite a period loss - Total equity increased to **HKD 62,546 thousand** as of December 31, 2021, an 8.9% increase from **HKD 57,445 thousand** on July 1, 2021[8](index=8&type=chunk) - Loss and total comprehensive loss for the period amounted to **(HKD 6,161) thousand**[8](index=8&type=chunk) - Share-based payment expenses were **HKD 3,115 thousand**[8](index=8&type=chunk) - Issuance of shares from placement resulted in an **HKD 8,147 thousand** increase in total equity[8](index=8&type=chunk) [Unaudited Condensed Consolidated Statement of Cash Flows](index=7&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the six months ended December 31, 2021, net cash outflow from operating activities was **HKD 20.96 million**, leading to a net decrease of **HKD 13.10 million** in cash and cash equivalents, with an ending balance of **HKD 36.35 million** Unaudited Condensed Consolidated Statement of Cash Flows Summary | Metric | Six Months Ended December 31, 2021 (thousand HKD) | Six Months Ended December 31, 2020 (thousand HKD) | Change | | :--- | :--- | :--- | :--- | | Net Cash from Operating Activities | (20,955) | 11,196 | Turned from inflow to outflow | | Net Cash from Financing Activities | 7,846 | (89) | Turned from outflow to inflow | | Net Cash and Cash Equivalents | (13,098) | 11,118 | Turned from increase to decrease | | Cash and Cash Equivalents at End of Period | 36,349 | 49,114 | -26.0% | [Notes to the Unaudited Condensed Consolidated Interim Financial Statements](index=8&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed notes to the unaudited condensed consolidated interim financial statements, covering general information, accounting policies, risk management, and specific financial items [General Information](index=8&type=section&id=1%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) WT Group Holdings Limited, incorporated in the Cayman Islands, primarily engages in specialized and general building works in Hong Kong, with shares listed on GEM since December 2017 - The company was incorporated in the Cayman Islands as an exempted company on July 11, 2017[11](index=11&type=chunk) - Primarily engaged in specialized and general building works in Hong Kong[11](index=11&type=chunk) - Shares were listed on GEM of the Stock Exchange on December 28, 2017[12](index=12&type=chunk) [Basis of Preparation and Accounting Policies](index=8&type=section&id=2%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E5%8F%8A%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) Financial statements are prepared under HKAS 34 and GEM Listing Rules, using historical cost convention, with new standards effective July 1, 2021, having no significant impact - Prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" and Chapter 18 of the GEM Listing Rules[13](index=13&type=chunk) - Accounting policies are consistent with the consolidated financial statements for the year ended June 30, 2021, except for new standards[13](index=13&type=chunk) - Adoption of new standards had no significant impact on the Group's financial position and operating results[15](index=15&type=chunk) [Financial Risk Management and Financial Instruments](index=9&type=section&id=3%20%E8%B2%A1%E5%8B%99%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86%E5%8F%8A%E9%87%91%E8%9E%8D%E5%B7%A5%E5%85%B7) The Group faces credit, cash flow, fair value interest rate, and liquidity risks, with unchanged risk management policies since June 30, 2021, and book values of financial instruments approximating fair values - The business is exposed to credit risk, cash flow and fair value interest rate risk, and liquidity risk[16](index=16&type=chunk) - Risk management policies have not changed since June 30, 2021[17](index=17&type=chunk) - The carrying amounts of current financial assets and liabilities approximate their fair values[18](index=18&type=chunk) [Critical Accounting Estimates and Judgements](index=9&type=section&id=4%20%E9%97%9C%E9%8D%B5%E6%9C%83%E8%A8%88%E4%BC%B0%E8%A8%88%E5%8F%8A%E5%88%A4%E6%96%B7) Financial statement preparation involves management judgments, estimates, and assumptions, with key sources of uncertainty consistent with the most recent annual report - Preparation of financial statements requires management to make judgments, estimates, and assumptions[19](index=19&type=chunk) - Key sources of judgment and estimation uncertainty are consistent with the most recent annual report[19](index=19&type=chunk) [Revenue and Segment Information](index=10&type=section&id=5%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) All Group revenue is derived from contract revenue, primarily from specialized and general building works in Hong Kong, with all operations consolidated into a single operating segment - All revenue is contract revenue[20](index=20&type=chunk) - Primarily engaged in specialized and general building works in Hong Kong[20](index=20&type=chunk) - All operations are aggregated into a single operating segment, thus no operating segment or geographical analysis is presented[20](index=20&type=chunk)[21](index=21&type=chunk) [Other Income](index=10&type=section&id=6%20%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5) For the six months ended December 31, 2021, other income was mainly **HKD 11 thousand** from miscellaneous sources, compared to **HKD 712 thousand** from government grants in the prior year - Other income for the six months in 2021 was **HKD 11 thousand**, primarily from "others"[22](index=22&type=chunk) - Other income for the six months in 2020 was **HKD 712 thousand**, primarily from government grants[22](index=22&type=chunk) [Loss Before Income Tax](index=11&type=section&id=7%20%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%85%E5%89%8D%E虧%E6%90%8D) For the six months ended December 31, 2021, loss before income tax was **HKD 6.16 million**, mainly due to increased employee benefit expenses, including **HKD 3.12 million** in share-based payment expenses, and higher construction costs Loss Before Income Tax Components | Metric | Six Months Ended December 31, 2021 (thousand HKD) | Six Months Ended December 31, 2020 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Employee Benefit Expenses | 7,502 | 4,832 | 55.2% | | Share-based Payment Expenses | 3,115 | 0 | N/A (New) | | Construction Costs | 27,425 | 12,968 | 111.5% | [Finance Costs](index=12&type=section&id=8%20%E8%9E%8D%E8%B3%87%E6%88%90%E6%9C%AC) The Group's finance costs primarily consist of interest on lease liabilities, which increased to **HKD 17 thousand** for the six months ended December 31, 2021, compared to the prior year - Finance costs primarily consist of interest on lease liabilities[25](index=25&type=chunk) - Interest on lease liabilities for the six months in 2021 was **HKD 17 thousand**, an increase from **HKD 11 thousand** in the same period of 2020[25](index=25&type=chunk) [Income Tax Credit](index=12&type=section&id=9%20%E6%89%80%E5%BE%97%E7%A8%85%E6%8A%B5%E5%85%8D) For the six months ended December 31, 2021, the Group had no assessable profits, resulting in no Hong Kong profits tax provision, and entities in BVI or Cayman Islands are tax-exempt, leading to zero income tax credit - The Group had no assessable profits during the period, thus no Hong Kong profits tax provision was made[26](index=26&type=chunk) - Entities registered in the British Virgin Islands or Cayman Islands are exempt from taxation[26](index=26&type=chunk) Income Tax Credit Summary | Metric | Six Months Ended December 31, 2021 (thousand HKD) | Six Months Ended December 31, 2020 (thousand HKD) | Change | | :--- | :--- | :--- | :--- | | Income Tax Credit | 0 | 36 | -100% | [Dividends](index=12&type=section&id=10%20%E8%82%A1%E6%81%AF) For the six months ended December 31, 2021, the Board of Directors did not recommend the payment of any dividends - The Directors do not recommend the payment of any dividends[27](index=27&type=chunk) [Loss Per Share](index=13&type=section&id=11%20%E6%AF%8F%E8%82%A1%E虧%E6%90%8D) For the six months ended December 31, 2021, the Group's basic and diluted loss per share increased to **HK 0.60 cents**, up from **HK 0.38 cents** in the prior year, mainly due to widened loss and increased weighted average ordinary shares Loss Per Share Analysis | Metric | Six Months Ended December 31, 2021 | Six Months Ended December 31, 2020 | Change (%) | | :--- | :--- | :--- | :--- | | Loss Per Share (HK cents) | (0.60) | (0.38) | 57.9% (Loss increased) | | Weighted Average Number of Ordinary Shares (thousand shares) | 1,031,522 | 1,000,000 | 3.2% | - Diluted loss per share is equal to basic loss per share as there are no potential dilutive ordinary shares[30](index=30&type=chunk) [Trade and Project Retention Receivables](index=13&type=section&id=12%20%E6%87%89%E6%94%B6%E8%B2%BF%E6%98%93%E8%B3%AC%E6%AC%BE%E5%8F%8A%E6%87%89%E6%94%B6%E5%B7%A5%E7%A8%8B%E9%A0%85%E7%9B%AE%E4%BF%9D%E7%95%99%E9%87%91) As of December 31, 2021, net trade and project retention receivables significantly increased to **HKD 10.18 million**, primarily due to a substantial rise in trade receivables, with credit terms ranging from 30 to 180 days Trade and Project Retention Receivables Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Trade and Project Retention Receivables, Net | 10,181 | 271 | 3651.3% | | Trade Receivables | 10,500 | 521 | 1915.4% | - The Group grants credit periods ranging from **30 to 180 days** to third-party customers and holds no collateral as security[33](index=33&type=chunk) [Contract Assets](index=15&type=section&id=13%20%E5%90%88%E7%B4%84%E8%B3%87%E7%94%A2) As of December 31, 2021, net contract assets decreased to **HKD 10.52 million** from **HKD 12.30 million** on June 30, 2021, mainly due to a reduction in uncertified work in progress Contract Assets Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Net Contract Assets | 10,524 | 12,301 | -14.4% | | Uncertified Work in Progress | 2,225 | 4,450 | -50.0% | | Project Retention Receivables (Contract Assets) | 8,585 | 8,186 | 4.9% | [Deposits, Prepayments and Other Receivables](index=15&type=section&id=14%20%E6%8C%89%E9%87%91%E3%80%81%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of December 31, 2021, net deposits, prepayments, and other receivables significantly increased to **HKD 6.18 million**, primarily driven by a substantial rise in deposits and other receivables Deposits, Prepayments and Other Receivables Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Deposits, Prepayments and Other Receivables, Net | 6,175 | 1,153 | 435.6% | | Deposits and Other Receivables | 5,920 | 1,130 | 423.9% | [Restricted Cash and Cash and Cash Equivalents](index=16&type=section&id=15%20%E5%8F%97%E9%99%90%E5%88%B6%E7%8F%BE%E9%87%91%E5%8F%8A%E7%8F%BE%E9%87%91%E5%8F%8A%E7%8F%BE%E9%87%91%E7%AD%89%E5%83%B9%E7%89%A9) As of December 31, 2021, restricted cash increased to **HKD 5.53 million**, primarily as collateral for performance bonds, while cash and cash equivalents decreased to **HKD 36.35 million** Restricted Cash and Cash and Cash Equivalents Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Restricted Cash | 5,528 | 2,100 | 163.2% | | Cash and Cash Equivalents | 36,349 | 49,447 | -26.5% | - Restricted cash represents deposits pledged as collateral for performance bonds and does not bear interest[37](index=37&type=chunk) [Trade and Project Retention Payables](index=16&type=section&id=16%20%E6%87%89%E4%BB%98%E8%B2%BF%E6%98%93%E8%B3%AC%E6%AC%BE%E5%8F%8A%E6%87%89%E4%BB%98%E5%B7%A5%E7%A8%8B%E9%A0%85%E7%9B%AE%E4%BF%9D%E7%95%99%E9%87%91) As of December 31, 2021, total trade and project retention payables decreased to **HKD 3.12 million**, mainly due to a significant reduction in trade payables Trade and Project Retention Payables Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Total Trade and Project Retention Payables | 3,116 | 5,094 | -38.8% | | Trade Payables | 742 | 2,881 | -74.2% | - The average credit period for trade payables is generally **30 days**[39](index=39&type=chunk) [Accruals and Other Payables](index=17&type=section&id=17%20%E6%87%89%E8%A8%88%E8%B2%BB%E7%94%A8%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) As of December 31, 2021, accruals and other payables increased to **HKD 2.77 million**, primarily due to higher accrued legal and professional fees Accruals and Other Payables Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Accruals and Other Payables | 2,766 | 2,277 | 21.5% | | Accrued Legal and Professional Fees | 1,421 | 1,016 | 39.9% | [Share Capital](index=18&type=section&id=18%20%E8%82%A1%E6%9C%AC) As of December 31, 2021, the Company's issued share capital increased to **HKD 12.00 million**, mainly due to the issuance of **200,000,000 new shares** at a placement price of **HKD 0.042** per share Share Capital Summary | Metric | December 31, 2021 (thousand HKD) | June 30, 2021 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Issued and Fully Paid Share Capital | 12,000 | 10,000 | 20.0% | - On December 3, 2021, the Company placed **200,000,000 new shares** at a price of **HKD 0.042** per placing share[43](index=43&type=chunk) [Significant Related Party Transactions](index=19&type=section&id=19%20%E9%87%8D%E5%A4%A7%E9%97%9C%E8%81%AF%E6%96%B9%E4%BA%A4%E6%98%93) For the six months ended December 31, 2021, total key management personnel compensation increased to **HKD 3.09 million**, mainly due to the recognition of **HKD 1.30 million** in share-based payment expenses Key Management Personnel Compensation | Metric | Six Months Ended December 31, 2021 (thousand HKD) | Six Months Ended December 31, 2020 (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Key Management Personnel Compensation | 3,090 | 2,381 | 29.8% | | Share-based Payment Expenses | 1,303 | 0 | N/A (New) | [Contingent Liabilities](index=19&type=section&id=20%20%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of December 31, 2021, the Group's contingent liabilities for performance guarantees on construction contracts increased to **HKD 5.53 million** Contingent Liabilities for Performance Guarantees | Metric | December 31, 2021 (HKD) | June 30, 2021 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Performance Guarantees | 5,528,000 | 2,100,000 | 163.2% | - Performance guarantees are expected to be released in accordance with the terms of each construction contract[45](index=45&type=chunk) [Management Discussion and Analysis](index=20&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) This section provides management's discussion and analysis of the Group's business review, financial performance, future prospects, liquidity, and key risks [Business Review](index=20&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group primarily engages in specialized and general building works in Hong Kong, reporting a net loss of approximately **HKD 6.2 million** for the six months ended December 31, 2021, mainly due to **HKD 3.1 million** in share-based payment expenses - The Group primarily provides specialized and general building works as a contractor in Hong Kong through its operating subsidiaries[46](index=46&type=chunk) Net Loss Comparison | Metric | Six Months Ended December 31, 2021 (million HKD) | Six Months Ended December 31, 2020 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Net Loss | 6.2 | 3.8 | 63.2% (Loss widened) | - The increase in net loss was mainly due to the recognition of **HKD 3.1 million** in share-based payment expenses[46](index=46&type=chunk) [Financial Review](index=20&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's financial performance for the six months ended December 31, 2021, showed significant revenue growth and a shift from gross loss to gross profit, but administrative expenses increased due to share-based payments, widening the net loss [Revenue](index=20&type=section&id=%E6%94%B6%E7%9B%8A) For the six months ended December 31, 2021, the Group's revenue increased to **HKD 28.9 million**, primarily driven by an increased number of construction projects undertaken Total Revenue Comparison | Metric | Six Months Ended December 31, 2021 (million HKD) | Six Months Ended December 31, 2020 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 28.9 | 12.2 | 136.9% | - The increase in revenue was mainly due to the higher number of construction projects undertaken by the Group for the six months ended December 31, 2021, compared to the same period in 2020[47](index=47&type=chunk) [Gross Profit/(Loss) and Gross Profit/(Loss) Margin](index=20&type=section&id=%E6%AF%9B%E5%88%A9%E2%88%95%EF%BC%88%E6%90%8D%EF%BC%89%E5%8F%8A%E6%AF%9B%E5%88%A9%E2%88%95%EF%BC%88%E6%90%8D%EF%BC%89%E7%8E%87) For the six months ended December 31, 2021, the Group's gross profit turned from loss to **HKD 1.4 million**, with a gross profit margin of approximately **4.9%**, driven by more projects and improved overall margins Gross Profit/(Loss) and Margin Comparison | Metric | Six Months Ended December 31, 2021 | Six Months Ended December 31, 2020 | Change | | :--- | :--- | :--- | :--- | | Gross Profit/(Loss) | Approximately **HKD 1.4 million** (Gross Profit) | Approximately **HKD 0.8 million** (Gross Loss) | Turned from loss to profit | | Gross Profit/(Loss) Margin | Approximately **4.9%** (Gross Profit Margin) | Approximately **6.2%** (Gross Loss Margin) | Turned from loss to profit | - The shift from gross loss and gross loss margin to gross profit and gross profit margin was mainly due to an increased number of construction projects and improved overall project gross margins[48](index=48&type=chunk) [Administrative Expenses](index=20&type=section&id=%E8%A1%8C%E6%94%BF%E9%96%8B%E6%94%AF) For the six months ended December 31, 2021, administrative expenses increased to **HKD 7.6 million**, primarily due to the recognition of approximately **HKD 3.1 million** in share-based payment expenses Administrative Expenses Comparison | Metric | Six Months Ended December 31, 2021 (million HKD) | Six Months Ended December 31, 2020 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 7.6 | 3.8 | 100.0% | - The increase in administrative expenses was mainly due to the recognition of approximately **HKD 3.1 million** in share-based payment expenses for the period ended December 31, 2021[49](index=49&type=chunk) [Income Tax Credit](index=21&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E6%8A%B5%E5%85%8D) For the six months ended December 31, 2021, the Group had no assessable profits, thus no Hong Kong profits tax provision was made - For the six months ended December 31, 2021 and 2020, the Group had no assessable profits, and therefore no Hong Kong profits tax provision was made[50](index=50&type=chunk) [Loss and Total Comprehensive Loss Attributable to Owners of the Company](index=21&type=section&id=%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%93%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%94%E虧%E6%90%8D%E5%8F%8A%E5%85%A8%E9%9D%A2%E虧%E6%90%8D%E7%B8%BD%E9%A1%8D) For the six months ended December 31, 2021, the loss and total comprehensive loss attributable to owners of the Company increased to **HKD 6.2 million**, mainly due to the recognition of **HKD 3.1 million** in share-based payment expenses Loss and Total Comprehensive Loss Comparison | Metric | Six Months Ended December 31, 2021 (million HKD) | Six Months Ended December 31, 2020 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Loss and Total Comprehensive Loss | 6.2 | 3.8 | 63.2% (Loss increased) | - The increase in net loss after tax was mainly due to the recognition of **HKD 3.1 million** in share-based payment expenses[51](index=51&type=chunk) [Prospects](index=21&type=section&id=%E5%89%8D%E6%99%AF) The Group anticipates a challenging business environment with ongoing COVID-19 risks but is optimistic about opportunities from Hong Kong's Northern Metropolis development, focusing on foundation, renovation, and superstructure works, while exploring other investments - The business environment is expected to remain challenging, with the ongoing spread of COVID-19 increasing the Group's overall operating risks[52](index=52&type=chunk) - Optimistic about construction market opportunities arising from the Hong Kong Government's recently announced plan to develop the Northern Metropolis for housing and technology[52](index=52&type=chunk) - Will focus on foundation and site formation works, renovation works, and superstructure construction projects to capture more business opportunities[52](index=52&type=chunk) - The Directors will also consider other investment opportunities to expand the Group's revenue streams[52](index=52&type=chunk) [Liquidity and Financial Resources](index=22&type=section&id=%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) As of December 31, 2021, the Group maintained a sound financial position with a current ratio of approximately **11.0 times**, despite a decrease in bank balances and cash, offset by an increase in restricted cash Liquidity and Financial Resources Summary | Metric | December 31, 2021 (million HKD) | June 30, 2021 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Bank Balances and Cash | 36.3 | 49.4 | -26.5% | | Restricted Cash Balances | 5.5 | 2.1 | 161.9% | | Current Ratio (times) | 11.0 | 8.3 | 32.5% | - The Directors believe the Group's financial position is sound, enabling it to expand its core business and achieve its business objectives[54](index=54&type=chunk) [Gearing Ratio](index=22&type=section&id=%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E6%AF%94%E7%8E%87) As of December 31, 2021, the Group's gearing ratio was approximately **0.6%**, a **50%** decrease from **1.2%** on June 30, 2021, indicating reduced financial leverage Gearing Ratio Comparison | Metric | December 31, 2021 | June 30, 2021 | Change | | :--- | :--- | :--- | :--- | | Gearing Ratio | Approximately **0.6%** | Approximately **1.2%** | Decreased by **50%** | - Total debt refers to lease liabilities[55](index=55&type=chunk) [Pledge of the Group's Assets](index=22&type=section&id=%E6%9C%AC%E9%9B%86%E5%9C%98%E7%9A%84%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of December 31, 2021, the Group pledged approximately **HKD 5.5 million** in deposits as collateral for performance guarantees Pledged Deposits | Metric | December 31, 2021 (million HKD) | June 30, 2021 (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Pledged Deposits | 5.5 | 2.1 | 161.9% | - Pledged deposits serve as collateral for obtaining performance guarantees[56](index=56&type=chunk) [Foreign Exchange Risk](index=22&type=section&id=%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA) The Group's operations, transactions, and monetary assets/liabilities are primarily denominated in HKD in Hong Kong, thus it faces no significant foreign exchange fluctuation risk and has no hedging policy - Most of the Group's revenue-generating operations are conducted in Hong Kong, with transactions, monetary assets, and liabilities denominated in HKD[58](index=58&type=chunk) - The Group is not exposed to significant foreign exchange fluctuation risk[58](index=58&type=chunk) - The Group currently has no foreign currency hedging policy[58](index=58&type=chunk) [Capital Structure](index=22&type=section&id=%E8%B3%87%E6%9C%AC%E7%B5%90%E6%A7%8B) The Group's capital structure has not significantly changed since June 30, 2021, apart from the placement activities disclosed in the "Fund Raising and Use of Proceeds" section - The Group's capital structure has not undergone significant changes since June 30, 2021, except as disclosed in the "Fund Raising and Use of Proceeds" section[59](index=59&type=chunk) [Fund Raising and Use of Proceeds](index=23&type=section&id=%E7%B1%8C%E9%9B%86%E8%B3%87%E9%87%91%E5%8F%8A%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E7%94%A8%E9%80%94) On December 3, 2021, the Company completed a placement of **200,000,000 new shares**, raising net proceeds of approximately **HKD 8.1 million**, intended for construction projects and general working capital, with **HKD 1.0 million** used for working capital by December 31, 2021 - On December 3, 2021, the Company allotted and issued **200,000,000 new shares** at **HKD 0.042** per placing share[60](index=60&type=chunk) - Net proceeds from the placement were approximately **HKD 8.1 million**[60](index=60&type=chunk) - Net proceeds were intended for approximately **HKD 5.1 million** for the Group's construction projects and approximately **HKD 3.0 million** for general working capital[60](index=60&type=chunk) - As of December 31, 2021, approximately **HKD 1.0 million** of the net proceeds had been used for the Group's general working capital[60](index=60&type=chunk) [Treasury Policy](index=23&type=section&id=%E5%BA%AB%E5%8B%99%E6%94%BF%E7%AD%96) The Board will continue to follow a prudent policy in managing cash balances, maintaining a strong liquidity position to capitalize on future growth opportunities - The Directors will continue to follow a prudent policy in managing the Group's cash balances[61](index=61&type=chunk) - Maintaining a strong and sound liquidity position ensures the Group can fully leverage future growth opportunities[61](index=61&type=chunk) [Principal Risks and Uncertainties](index=23&type=section&id=%E4%B8%BB%E8%A6%81%E9%A2%A8%E9%9A%AA%E5%8F%8A%E4%B8%8D%E7%A2%BA%E5%AE%9A%E5%9B%A0%E7%B4%A0) The Group faces various business risks, including uncertainties in project bidding, inaccurate cost estimations, reliance on subcontractors, customer credit risk, and impacts from the Hong Kong construction industry and overall economic conditions - The Group's revenue depends on successful bidding or tendering for non-recurring specialized and general building works projects[62](index=62&type=chunk) - Inaccurate project cost estimations and/or project delays may lead to cost overruns or even losses[62](index=62&type=chunk) - The Group relies on subcontractors for certain site works, and their unsatisfactory performance could adversely affect operations and profitability[62](index=62&type=chunk) - The Group faces credit risk from customers; if customers fail to pay on time or in full, liquidity may be adversely affected[66](index=66&type=chunk) - The Group's performance is dependent on trends and developments in the Hong Kong construction industry, as well as market conditions and the overall economic and political situation in Hong Kong[66](index=66&type=chunk) [Capital Commitments](index=24&type=section&id=%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) As of December 31, 2021, the Group had no capital commitments - As of December 31, 2021, the Group had no capital commitments[63](index=63&type=chunk) [Material Investments Held, Material Acquisitions and Disposals of Subsidiaries and Affiliated Companies](index=24&type=section&id=%E6%89%80%E6%8C%81%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E3%80%81%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E5%8F%8A%E8%81%AF%E5%B1%AC%E5%85%AC%E5%8F%B8) For the six months ended December 31, 2021, the Company held no material investments, acquisitions, or disposals of subsidiaries and affiliated companies, other than those disclosed in this report - For the six months ended December 31, 2021, the Company held no material investments, material acquisitions, or disposals of subsidiaries and affiliated companies[64](index=64&type=chunk) [Employees and Remuneration Policy](index=24&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of December 31, 2021, the Company had **26 employees** with employee benefit expenses of approximately **HKD 7.5 million**, and its remuneration policy is based on position, qualifications, and performance, supported by a share option scheme Employee Statistics and Benefit Expenses | Metric | December 31, 2021 | June 30, 2021 | Change (%) | | :--- | :--- | :--- | :--- | | Number of Employees | 26 | 21 | 23.8% | | Employee Benefit Expenses (six months, million HKD) | 7.5 | 4.8 | 56.3% | - The Group remunerates staff based on their position, qualifications, and performance, with bonuses paid referencing results and employee performance[65](index=65&type=chunk) - The Company has a share option scheme to incentivize and reward participants for their contributions to the Group[65](index=65&type=chunk) [Other Information](index=25&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) This section covers other important information, including disclosure of interests, competing interests, securities transactions, corporate governance, dividends, post-reporting events, share option scheme details, and the audit committee's review [Disclosure of Interests](index=25&type=section&id=%E6%AC%8A%E7%9B%8A%E6%8A%AB%E9%9C%B2) This section discloses the interests and short positions of directors, chief executives, and substantial shareholders in the Company's shares or underlying shares, including share options held by four directors and significant holdings by China Silver Asset Management Limited [A. Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares or Debentures](index=25&type=section&id=A.%20%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%E6%88%96%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) As of December 31, 2021, four directors (Mr. Kam Kin Pan, Ms. Wong Mei Chun, Ms. Chan Sin Wah, Mr. Yu Tat Chi) each held **10,000,000 unlisted share options**, representing approximately **8.33%** of the Company's total issued share capital Directors' and Chief Executive's Interests in Share Options | Director Name | Capacity | Number of Unlisted Share Options | Approximate Percentage of Total Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Kam Kin Pan | Beneficial Owner | 10,000,000 | 8.33% | | Ms. Wong Mei Chun | Beneficial Owner | 10,000,000 | 8.33% | | Ms. Chan Sin Wah | Beneficial Owner | 10,000,000 | 8.33% | | Mr. Yu Tat Chi | Beneficial Owner | 10,000,000 | 8.33% | [B. Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares or Underlying Shares](index=26&type=section&id=B.%20%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E5%8F%8A%E5%85%B6%E4%BB%96%E4%BA%BA%E5%A3%AB%E6%96%BC%E8%82%A1%E4%BB%BD%E6%88%96%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E4%B8%AD%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) As of December 31, 2021, China Silver Asset Management Limited (as investment manager) and CS Asia Opportunities Master Fund (as beneficial owner) each held **167,580,000 shares**, representing approximately **13.97%** of the Company's total issued share capital Substantial Shareholders' Interests | Shareholder Name | Nature of Interest | Number of Shares Held/Interested | Approximate Percentage of Total Issued Share Capital | | :--- | :--- | :--- | :--- | | China Silver Asset Management Limited | Investment Manager | 167,580,000 | 13.97% | | CS Asia Opportunities Master Fund | Beneficial Owner | 167,580,000 | 13.97% | [Competing Interests](index=26&type=section&id=%E7%AB%B6%E7%88%AD%E6%AC%8A%E7%9B%8A) As of December 31, 2021, and up to the report date, the Directors were unaware of any direct or indirect competing business interests held by any Director, controlling shareholder, or their close associates - The Directors are unaware of any business or interest of any Director, controlling shareholder, or their respective close associates that directly or indirectly competes or may compete with the Group's business[72](index=72&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=27&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%9A%84%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) For the six months ended December 31, 2021, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the six months ended December 31, 2021, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[74](index=74&type=chunk) [Corporate Governance Code](index=27&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) The Company has complied with all applicable provisions of the Corporate Governance Code, with the exception of the Chairman and Executive Director, Mr. Kam Kin Pan, holding both roles, which the Board believes is in the Group's best interest - The Company has complied with all applicable code provisions of the Corporate Governance Code[75](index=75&type=chunk) - A deviation from Code Provision A.2.1 of the Corporate Governance Code exists as Mr. Kam Kin Pan serves as both Chairman and Executive Director, managing both the Board and daily operations[75](index=75&type=chunk) - The Board believes that Mr. Kam's dual role facilitates management efficiency and business development, serving the Group's best interests[75](index=75&type=chunk) [Directors' Securities Transactions](index=28&type=section&id=%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) Following inquiries with all Directors, it is confirmed that the Model Code for Securities Transactions by Directors of Listed Issuers, as stipulated by the GEM Listing Rules, was complied with for the six months ended December 31, 2021 - All Directors confirmed compliance with the required standards of dealing and the Model Code for Securities Transactions by Directors of Listed Issuers for the six months ended December 31, 2021[77](index=77&type=chunk) [Interim Dividend](index=28&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) For the six months ended December 31, 2021, the Board of Directors did not recommend the payment of an interim dividend - For the six months ended December 31, 2021, the Board of Directors did not recommend the payment of an interim dividend[78](index=78&type=chunk) [Events After the Reporting Period](index=28&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E4%BB%B6) As of the report date, the Board of Directors was not aware of any significant disclosable events occurring after the reporting period - As of the date of this report, the Board of Directors was not aware of any significant disclosable events occurring after the reporting period[79](index=79&type=chunk) [Share Option Scheme](index=28&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The Company adopted a share option scheme on December 1, 2017, and granted **100,000,000 share options** to eligible participants on October 8, 2021, with a fair value of approximately **HKD 3.12 million**, recognized as share-based payment expenses - The Company adopted a share option scheme on December 1, 2017, with a **10-year** validity period[80](index=80&type=chunk) - On October 8, 2021, a total of **100,000,000 share options** were granted to eligible participants under the scheme[80](index=80&type=chunk) - The fair value per share option on the grant date was **HKD 0.031**, totaling approximately **HKD 3,115,000**[81](index=81&type=chunk) - **HKD 3,115,000** was deducted as share-based payment expenses in the profit or loss for the six months ended December 31, 2021[81](index=81&type=chunk) [Disposal of Shares by a Controlling Shareholder](index=29&type=section&id=%E4%B8%80%E5%90%8D%E6%8E%A7%E8%82%A1%E8%82%A1%E6%9D%B1%E5%87%BA%E5%94%AE%E8%82%A1%E4%BB%BD) Controlling shareholder Tak Wing Venture Limited sold **576,600,000 shares** of the Company on July 21, 2021, representing approximately **57.66%** of the total issued shares, after which Tak Wing no longer held any Company shares - Tak Wing Venture Limited sold **576,600,000 shares** of the Company on the open market on July 21, 2021[83](index=83&type=chunk) - The shares sold represented approximately **57.66%** of the Company's total issued shares[83](index=83&type=chunk) - Immediately following the disposal, Tak Wing held no shares in the Company[83](index=83&type=chunk) [Audit Committee](index=30&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, comprising three independent non-executive directors and chaired by Mr. Leung Chi Hung, reviewed the Group's unaudited condensed consolidated interim financial statements for the six months ended December 31, 2021, deeming them prepared in compliance with applicable accounting standards and GEM Listing Rules - The Audit Committee currently comprises three independent non-executive Directors, with Mr. Leung Chi Hung as Chairman[84](index=84&type=chunk) - The Audit Committee has reviewed the Group's unaudited condensed consolidated interim financial statements for the six months ended December 31, 2021[84](index=84&type=chunk) - The Audit Committee believes the financial statements were prepared in accordance with applicable accounting standards and the GEM Listing Rules, with adequate disclosures[84](index=84&type=chunk) [By Order of the Board](index=30&type=section&id=%E6%89%BF%E8%91%A3%E4%BA%8B%E6%9C%83%E5%91%BD) This report was issued by Mr. Kam Kin Pan, Chairman and Executive Director of WT Group Holdings Limited, on behalf of the Board on February 11, 2022, detailing the Board members and report dissemination channels - This report was issued by Mr. Kam Kin Pan, Chairman and Executive Director of WT Group Holdings Limited, on February 11, 2022[85](index=85&type=chunk) - The Board of Directors includes Executive Directors Mr. Kam Kin Pan (Chairman) and Ms. Wong Mei Chun; and Independent Non-executive Directors Ms. Chan Sin Wah, Mr. Leung Chi Hung, and Mr. Yu Tat Chi[86](index=86&type=chunk) - This report will be available on the GEM website and the Company's website for at least seven consecutive days from the date of publication[86](index=86&type=chunk)

[Report Overview and Company Information](index=2&type=section&id=I.%20%E5%A0%B1%E5%91%8A%E6%A6%82%E8%A7%88%E4%B8%8E%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) [GEM Market Characteristics and Disclaimer](index=2&type=section&id=1.1%20GEM%E5%B8%82%E5%A0%B4%E7%89%B9%E8%89%B2%E8%88%87%E5%85%8D%E8%B2%AC%E8%81%B2%E6%98%8E) This section outlines GEM market investment risks, clarifies the Stock Exchange's non-responsibility, and affirms directors' full accountability for report accuracy - The GEM market provides a listing platform for SMEs, but investment risks are high, with securities potentially facing significant market volatility and uncertain liquidity[1](index=1&type=chunk) - Hong Kong Exchanges and Clearing Limited and the Stock Exchange bear no responsibility for this report's content, making no statement on its accuracy or completeness[1](index=1&type=chunk) - The company directors jointly and individually assume full responsibility for the information in this report, confirming its accuracy, completeness, and non-misleading nature in all material aspects[1](index=1&type=chunk) [Company Information](index=3&type=section&id=1.2%20%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E8%B3%87%E6%96%99) This section details WT Group Holdings Limited's board and committee members, registered and business locations, and other key company information [Board of Directors](index=3&type=section&id=1.2.1%20%E8%91%A3%E4%BA%8B%E6%9C%83%E6%88%90%E5%93%A1) The Board comprises executive and independent non-executive directors, with Mr. Kam Kin Pan as Chairman, noting personnel changes during the reporting period - Executive Directors include Mr. Kam Kin Pan (Chairman), Mr. Kung Cheung Fai, and Ms. Wong Mei Chun (appointed on July **28**, **2021**)[5](index=5&type=chunk) - Independent Non-executive Directors include Ms. Chan Sin Wah (appointed on July **28**, **2021**), Mr. Leung Chi Hung, and Mr. Yu Tat Chi (appointed on September **20**, **2021**)[5](index=5&type=chunk) - Ms. Wong Lai Na and Ms. Yim Kwan Wing both resigned as Independent Non-executive Directors on July **28**, **2021**[5](index=5&type=chunk) [Committee Members](index=3&type=section&id=1.2.2%20%E5%A7%94%E5%93%A1%E6%9C%83%E6%88%90%E5%93%A1) Membership and chair positions for the Audit, Nomination, and Remuneration Committees are listed, with updates on personnel changes for governance transparency - The Audit Committee is chaired by Mr. Leung Chi Hung, with members Ms. Chan Sin Wah and Mr. Yu Tat Chi, noting relevant appointments and resignations[5](index=5&type=chunk) - The Nomination Committee is chaired by Ms. Chan Sin Wah, with members Mr. Kam Kin Pan, Mr. Leung Chi Hung, and Mr. Yu Tat Chi, noting relevant appointments and resignations[5](index=5&type=chunk) - The Remuneration Committee is chaired by Ms. Chan Sin Wah, with members Mr. Kam Kin Pan, Mr. Leung Chi Hung, and Mr. Yu Tat Chi, noting relevant appointments and resignations[5](index=5&type=chunk) [Registered and Business Locations](index=3&type=section&id=1.2.3%20%E8%A8%BB%E5%86%8A%E8%88%87%E7%87%9F%E6%A5%AD%E5%9C%B0%E9%BB%9E) The company's registered office is in the Cayman Islands, with its Hong Kong headquarters and principal place of business in Tai Kok Tsui, Kowloon - The registered office is located at Cricket Square, Hutchins Drive, P.O. Box **2681**, Grand Cayman KY**1**-**1111**, Cayman Islands[6](index=6&type=chunk) - The Hong Kong headquarters and principal place of business are located at Unit A, **6**/F, Park Sun Building, **33** Fir Street, Tai Kok Tsui, Kowloon, Hong Kong[6](index=6&type=chunk) [Other Company Information](index=4&type=section&id=1.2.4%20%E5%85%B6%E4%BB%96%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) This section provides company information including share registrars, principal bankers, auditor, stock code (**8422**), and official website - The principal share registrar and transfer office in the Cayman Islands is Conyers Trust Company (Cayman) Limited[7](index=7&type=chunk) - The Hong Kong branch share registrar and transfer office is Union Registrars Limited[7](index=7&type=chunk) - Principal bankers include Bank of China (Hong Kong) Limited and DBS Bank (Hong Kong) Limited, with auditor Crowe (HK) CPA Limited[7](index=7&type=chunk) - The company's stock code is **8422**, and its official website is http://www.wtgholdings.com[7](index=7&type=chunk) [Financial Performance](index=5&type=section&id=II.%20%E8%B2%A1%E5%8B%99%E6%A5%AD%E7%B8%BE) [Unaudited Condensed Consolidated Statement of Comprehensive Income](index=5&type=section&id=2.1%20%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the three months ended September **30**, **2021**, the Group's net loss narrowed by **35.95%** to approximately **HKD 0.56 million**, driven by a **116.58% revenue increase** to **HKD 17.88 million**, despite rising service costs Unaudited Condensed Consolidated Statement of Comprehensive Income (For the three months ended September 30) | Metric | 2021 (thousand HKD) | 2020 (thousand HKD) | Change (thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 17,878 | 8,255 | 9,623 | 116.58% | | Cost of Services | (16,521) | (7,118) | (9,403) | 132.09% | | Gross Profit | 1,357 | 1,137 | 220 | 19.35% | | Other Income | – | 309 | (309) | -100.00% | | Administrative Expenses | (1,852) | (2,321) | 469 | -20.21% | | Finance Costs | (9) | (5) | (4) | 80.00% | | Loss Before Income Tax | (504) | (880) | 376 | -42.73% | | Income Tax (Expense) / Credit | (59) | 1 | (60) | -6000.00% | | Loss and Total Comprehensive Loss Attributable to Owners of the Company for the Period | (563) | (879) | 316 | -35.95% | | Loss Per Share (HK cents) | (0.06) | (0.09) | 0.03 | -33.33% | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=6&type=section&id=2.2%20%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) As of September **30**, **2021**, total equity attributable to owners was **HKD 56,882 thousand**, a decrease from **HKD 63,962 thousand** in **2020**, primarily due to a **HKD 563 thousand loss** Unaudited Condensed Consolidated Statement of Changes in Equity (As of September 30) | Metric | September 30, 2021 (thousand HKD) | September 30, 2020 (thousand HKD) | | :--- | :--- | :--- | | Share Capital | 10,000 | 10,000 | | Share Premium | 36,855 | 36,855 | | Other Reserves | 10,100 | 10,100 | | Retained Earnings / (Accumulated Losses) | (73) | 7,007 | | **Total** | **56,882** | **63,962** | - Loss and total comprehensive loss for the period: **HKD (563) thousand** in **2021**, **HKD (879) thousand** in **2020**[10](index=10&type=chunk) [Notes to the Financial Statements](index=7&type=section&id=2.3%20%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed notes to the unaudited condensed consolidated financial statements, covering company information, accounting policies, revenue, tax, EPS, and dividend policy [General Information](index=7&type=section&id=2.3.1%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) The company was incorporated in the Cayman Islands in **2017** as an exempted company, primarily engaged in specialized and general building works in Hong Kong, and listed on GEM in December **2017** - The company was incorporated as an exempted company under Cayman Islands law on July **11**, **2017**[11](index=11&type=chunk) - The Group primarily engages in specialized and general building works in Hong Kong[12](index=12&type=chunk) - The company's shares were listed on GEM of the Stock Exchange on December **28**, **2017**[13](index=13&type=chunk) [Basis of Preparation and Accounting Policies](index=7&type=section&id=2.3.2%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E5%8F%8A%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) The unaudited condensed consolidated financial statements are prepared under HKFRS and GEM Listing Rules, with consistent accounting policies and no material impact from new standards - The unaudited condensed consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards issued by the HKICPA and applicable disclosure requirements of the GEM Listing Rules[15](index=15&type=chunk) - The accounting policies used to prepare these unaudited condensed consolidated financial statements are consistent with those used for the company's consolidated financial statements for the year ended June **30**, **2021**[15](index=15&type=chunk) - The adoption of new and revised standards and interpretations had no material impact on the Group's financial position or operating results[18](index=18&type=chunk) [Revenue Analysis](index=8&type=section&id=2.3.3%20%E6%94%B6%E7%9B%8A%E5%88%86%E6%9E%90) The Group's contract revenue for the three months ended September **30**, **2021**, significantly increased to **HKD 17,878 thousand** from **HKD 8,225 thousand** in **2020** Revenue (For the three months ended September 30) | Metric | 2021 (thousand HKD) | 2020 (thousand HKD) | | :--- | :--- | :--- | | Contract Revenue | 17,878 | 8,225 | [Income Tax](index=9&type=section&id=2.3.4%20%E6%89%80%E5%BE%97%E7%A8%85) Hong Kong profits tax is provisioned at **16.5%** with a two-tiered rate; BVI/Cayman entities are tax-exempt, with **HKD 59 thousand** income tax expense for the period - For the three months ended September **30**, **2021**, Hong Kong profits tax was provided at a rate of **16.5%** on assessable profits (**2020**: nil)[20](index=20&type=chunk) - Under the two-tiered profits tax regime, the first **HKD 2 million** of assessable profits for eligible entities is taxed at **8.25%**, and profits exceeding **HKD 2 million** are taxed at **16.5%**[20](index=20&type=chunk) Income Tax (Expense) / Credit (For the three months ended September 30) | Metric | 2021 (thousand HKD) | 2020 (thousand HKD) | | :--- | :--- | :--- | | Current Income Tax — Hong Kong Profits Tax | (59) | – | | Deferred Income Tax | – | 1 | | Income Tax (Expense) / Credit | (59) | 1 | [Loss Per Share](index=9&type=section&id=2.3.5%20%E6%AF%8F%E8%82%A1%E虧%E6%90%8D) For the three months ended September **30**, **2021**, basic and diluted loss per share was **0.06 HK cents**, an improvement from **0.09 HK cents** last year, with no dilutive potential ordinary shares Loss Per Share (For the three months ended September 30) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Loss Attributable to Owners of the Company (thousand HKD) | (563) | (879) | | Weighted Average Number of Ordinary Shares for Basic and Diluted EPS (thousand shares) | 1,000,000 | 1,000,000 | | Loss Per Share (HK cents) | (0.06) | (0.09) | - Basic loss per share is calculated by dividing the loss attributable to owners of the company by the weighted average number of ordinary shares outstanding during each period[22](index=22&type=chunk) - There were no potential dilutive ordinary shares in any period, thus diluted loss per share equals basic loss per share[24](index=24&type=chunk) [Dividend Policy](index=9&type=section&id=2.3.6%20%E8%82%A1%E6%81%AF%E6%94%BF%E7%AD%96) The Board does not recommend paying any dividend for the three months ended September **30**, **2021**, consistent with the prior year - The Board does not recommend paying a dividend for the three months ended September **30**, **2021** (**2020**: nil)[25](index=25&type=chunk) [Management Discussion and Analysis](index=10&type=section&id=III.%20%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) [Business Review and Outlook](index=10&type=section&id=3.1%20%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%B1%95%E6%9C%9B) The Group, primarily engaged in specialized and general building works in Hong Kong, saw its net loss narrow to approximately **HKD 0.6 million** for the three months ended September **30**, **2021**, driven by increased project volume, revenue, and gross profit - The Group primarily provides specialized and general building works as a contractor in Hong Kong through its operating subsidiaries[27](index=27&type=chunk) - For the three months ended September **30**, **2021**, the Group recorded a net loss of approximately **HKD 0.6 million**, a reduction from **HKD 0.9 million** in the same period of **2020**[27](index=27&type=chunk) - The decrease in net loss was primarily due to increased revenue and gross profit, driven by a higher number of construction projects undertaken[27](index=27&type=chunk) [Financial Review](index=10&type=section&id=3.2%20%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section reviews financial performance, including revenue, gross profit, administrative expenses, and loss attributable to owners, noting increased revenue and gross profit from more projects, stable administrative expenses, and a narrowed net loss [Revenue](index=10&type=section&id=3.2.1%20%E6%94%B6%E7%9B%8A) For the three months ended September **30**, **2021**, total revenue surged **115.66%** to approximately **HKD 17.9 million** from **HKD 8.3 million** in **2020**, primarily due to increased construction projects Revenue (For the three months ended September 30) | Metric | 2021 (million HKD) | 2020 (million HKD) | Change (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 17.9 | 8.3 | 9.6 | 115.66% | - The increase in revenue was primarily due to a higher number of construction projects undertaken by the Group for the three months ended September **30**, **2021**, compared to the same period in **2020**[28](index=28&type=chunk) [Gross Profit and Gross Margin](index=10&type=section&id=3.2.2%20%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) Gross profit increased to approximately **HKD 1.4 million**, but gross margin declined from **13.8%** to **7.6%**, primarily due to increased construction project volume Gross Profit and Gross Margin (For the three months ended September 30) | Metric | 2021 (million HKD) | 2020 (million HKD) | Change (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Gross Profit | 1.4 | 1.1 | 0.3 | 27.27% | | Gross Margin | 7.6% | 13.8% | -6.2% | -44.93% | - The decrease in gross margin was primarily due to a higher number of construction projects undertaken by the Group for the three months ended September **30**, **2021**, compared to the same period in **2020**[29](index=29&type=chunk) [Administrative Expenses](index=10&type=section&id=3.2.3%20%E8%A1%8C%E6%94%BF%E9%96%8B%E6%94%AF) Administrative expenses for the three months ended September **30**, **2021**, were approximately **HKD 1.9 million**, a slight decrease from **HKD 2.3 million** in **2020**, with no significant overall change Administrative Expenses (For the three months ended September 30) | Metric | 2021 (million HKD) | 2020 (million HKD) | Change (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Administrative Expenses | 1.9 | 2.3 | (0.4) | -17.39% | - Administrative expenses primarily include employee benefit expenses (including directors' emoluments), audit fees, and other professional fees[30](index=30&type=chunk) - There were no significant changes in administrative expenses for the three months ended September **30**, **2021**, compared to the same period in **2020**[30](index=30&type=chunk) [Loss and Total Comprehensive Loss Attributable to Owners of the Company](index=11&type=section&id=3.2.4%20%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%93%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%B5%E虧%E6%90%8D%E5%8F%8A%E5%85%A8%E9%9D%A2%E虧%E6%90%8D%E7%B8%BD%E9%A1%8D) For the three months ended September **30**, **2021**, loss and total comprehensive loss attributable to owners decreased **33.33%** to approximately **HKD 0.6 million** from **HKD 0.9 million**, mainly due to increased revenue and gross profit Loss and Total Comprehensive Loss Attributable to Owners of the Company (For the three months ended September 30) | Metric | 2021 (million HKD) | 2020 (million HKD) | Change (million HKD) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Loss and Total Comprehensive Loss Attributable to Owners of the Company | 0.6 | 0.9 | (0.3) | -33.33% | - The decrease in net loss was primarily due to increased revenue and gross profit, driven by a higher number of construction projects undertaken[31](index=31&type=chunk) [Future Prospects](index=11&type=section&id=3.3%20%E6%9C%AA%E4%BE%86%E5%89%8D%E6%99%AF) The Group anticipates a challenging business environment with increased COVID-**19** risks but remains optimistic about Hong Kong's northern development, planning market expansion, prudent financial management, and exploring new investment opportunities - The Group anticipates a continuously challenging and competitive business environment, with the COVID-**19** pandemic increasing overall operating risks[32](index=32&type=chunk) - Given the Hong Kong government's plans for northern housing and technology development, the Group is optimistic about long-term construction market opportunities[32](index=32&type=chunk) - The Group will continue to expand market share, compete for more foundation, site formation, and superstructure projects, and adhere to prudent financial management for sustainable growth and capital adequacy[32](index=32&type=chunk) - The Board will also consider other investment opportunities to diversify the Group's revenue streams, while being mindful of associated risks[32](index=32&type=chunk) [Equity and Corporate Governance](index=11&type=section&id=IV.%20%E8%82%A1%E6%AC%8A%E8%88%87%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86) [Disposal of Shares by Controlling Shareholder](index=11&type=section&id=4.1%20%E6%8E%A7%E8%82%A1%E8%82%A1%E6%9D%B1%E8%82%A1%E4%BB%BD%E5%87%BA%E5%94%AE) Controlling shareholder Tak Wing Venture Limited sold approximately **57.66%** of the company's issued shares on July **21**, **2021**, ceasing to hold any shares thereafter to an independent third party - Tak Wing Venture Limited sold **576,600,000** shares of the company, representing approximately **57.66%** of the total issued shares, on July **21**, **2021**[33](index=33&type=chunk) - Immediately after the disposal, Tak Wing held no shares in the company[33](index=33&type=chunk) - Tak Wing was **34%** owned by Mr. Kung Cheung Fai (Executive Director), **33%** by Mr. Yip Siu Ching (deceased), and **33%** by Mr. Kam Kin Pan (Executive Director)[33](index=33&type=chunk) [Disclosure of Interests](index=12&type=section&id=4.2%20%E6%AC%8A%E7%9B%8A%E6%8A%AB%E9%9C%B2) This section discloses no disclosable share interests for directors and chief executives as of September **30**, **2021**, but identifies China Silver Asset Management Limited and CS Asia Opportunities Master Fund as substantial shareholders, each holding **16.13%** [Directors' and Chief Executive's Interests](index=12&type=section&id=4.2.1%20%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%AC%8A%E7%9B%8A) As of September **30**, **2021**, no directors or chief executives held disclosable interests or short positions in the company's or its associated corporations' shares, underlying shares, or debentures - As of September **30**, **2021**, no directors or chief executives held disclosable interests or short positions in the shares, underlying shares, or debentures of the company or its associated corporations[35](index=35&type=chunk) [Interests of Substantial Shareholders and Other Persons](index=12&type=section&id=4.2.2%20%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E5%8F%8A%E5%85%B6%E4%BB%96%E4%BA%BA%E5%A3%AB%E6%AC%8A%E7%9B%8A) As of September **30**, **2021**, China Silver Asset Management Limited and CS Asia Opportunities Master Fund are listed as substantial shareholders, each holding **16.13%** of the company's issued share capital Interests of Substantial Shareholders and Other Persons in Shares or Underlying Shares (As of September 30, 2021) | Shareholder Name | Nature of Interest | Number of Shares Held / Interested | Percentage of Total Issued Share Capital | | :--- | :--- | :--- | :--- | | China Silver Asset Management Limited | Investment Manager | 161,320,000 | 16.13% | | CS Asia Opportunities Master Fund | Beneficial Owner | 161,320,000 | 16.13% | [Conflicts of Interest](index=13&type=section&id=4.3%20%E5%88%A9%E7%9B%8A%E8%A1%9D%E7%AA%81) The Board confirms no direct or indirect competing business or conflicts of interest between directors, controlling shareholders, or their respective close associates and the Group's business, for the three months ended September **30**, **2021**, and up to the report date - The Directors are unaware of any business or interest of any Director, controlling shareholder, or their respective close associates that directly or indirectly competes or may compete with the Group's business, or any other conflicts of interest, for the three months ended September **30**, **2021**, and up to the report date[37](index=37&type=chunk) [Dealings in Listed Securities](index=13&type=section&id=4.4%20%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) For the three months ended September **30**, **2021**, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of its listed securities - For the three months ended September **30**, **2021**, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[38](index=38&type=chunk) [Corporate Governance Practices](index=13&type=section&id=4.5%20%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The company largely complied with the Corporate Governance Code, with one deviation: no CEO appointed, Mr. Kam Kin Pan manages both board and daily operations, deemed beneficial for efficiency and development - The company has complied with all applicable code provisions of the Corporate Governance Code, except as noted below[39](index=39&type=chunk) - Deviation from Corporate Governance Code provision A.**2.1**: The Group has not appointed a Chief Executive Officer, with Mr. Kam Kin Pan primarily responsible for both board management and daily business operations[39](index=39&type=chunk) - The Board believes that Mr. Kam's dual role enhances management efficiency and business development, serving the Group's best interests[39](index=39&type=chunk) [Directors' Securities Transactions](index=14&type=section&id=4.6%20%E8%91%A3%E4%BA%8B%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) Following specific inquiries, all directors confirmed compliance with required dealing standards and codes of conduct for securities transactions for the three months ended September **30**, **2021** - Following specific inquiries, all Directors confirmed compliance with the required dealing standards and code of conduct for directors' securities transactions for the three months ended September **30**, **2021**[41](index=41&type=chunk) [Share Option Scheme](index=14&type=section&id=4.7%20%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The company adopted a share option scheme in **2017**, but no options were granted, lapsed, exercised, or cancelled, and none remained outstanding for the three months ended September **30**, **2021** - The company adopted a share option scheme pursuant to a resolution passed by its then shareholders on December **1**, **2017**[43](index=43&type=chunk) - For the three months ended September **30**, **2021**, no share options were granted, lapsed, exercised, or cancelled under the share option scheme[43](index=43&type=chunk) - As of September **30**, **2021**, no share options remained outstanding[43](index=43&type=chunk) [Events After Reporting Period](index=14&type=section&id=4.8%20%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E4%BB%B6) As of the report date, the Board is unaware of any disclosable material events occurring after the reporting period - As of the report date, other than as disclosed in this report, the Board is unaware of any disclosable material events occurring after the reporting period[44](index=44&type=chunk) [Audit Committee Report](index=14&type=section&id=4.9%20%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83%E5%A0%B1%E5%91%8A) The Audit Committee, comprising three independent non-executive directors chaired by Mr. Leung Chi Hung, reviewed the unaudited condensed consolidated financial statements and report, deeming them compliant with accounting standards and GEM Listing Rules - The Audit Committee comprises three independent non-executive directors, with Mr. Leung Chi Hung as Chairman[45](index=45&type=chunk) - The Audit Committee has reviewed the Group's unaudited condensed consolidated financial statements and this report for the three months ended September **30**, **2021**[46](index=46&type=chunk) - The Audit Committee believes the Group's unaudited condensed consolidated financial statements for the three months ended September **30**, **2021**, comply with applicable accounting standards, and this quarterly report is prepared in accordance with GEM Listing Rules, with adequate disclosure[46](index=46&type=chunk)

[Company Information](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section provides core company information including basic registration details, board and committee members, principal bankers, auditors, and share registrars [Company Overview and Key Personnel](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E6%A6%82%E8%A6%BD%E8%88%87%E4%B8%BB%E8%A6%81%E4%BA%BA%E5%93%A1) This section provides core company information including basic registration details, board and committee members, principal bankers, auditors, and share registrars, noting significant changes in board and committee members during the reporting period - The company's Board of Directors, Audit Committee, Nomination Committee, and Remuneration Committee experienced multiple member changes, including new appointments and resignations, in July and September 2021[4](index=4&type=chunk) - The company's Chairman is Mr. Kam Kin Bun, who also serves as Compliance Officer; its registered office is in the Cayman Islands, with Hong Kong headquarters in Tai Kok Tsui[4](index=4&type=chunk)[5](index=5&type=chunk) [Chairman's Statement and Management Discussion and Analysis](index=5&type=section&id=%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A%E5%8F%8A%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) This section reviews the Group's performance, strategy, liquidity, and human resources, highlighting a decline in revenue and expanded loss, alongside stable financial resources and a decision not to declare a dividend [Business and Financial Review](index=5&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) This fiscal year, the Group experienced significant declines in revenue and gross profit, with an expanded loss primarily due to fewer large construction projects, while gross profit margin improved due to optimized project mix, and net loss widened mainly from impairment losses on property, plant and equipment and right-of-use assets, and reversal of deferred tax assets Financial Performance Summary | Financial Indicator | FY2021 (Million HKD) | FY2020 (Million HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | **33.8** | **61.2** | -44.8% | | Gross Profit | **2.1** | **2.4** | -12.5% | | Gross Profit Margin | **6.3%** | **3.9%** | +2.4pp | | Loss for the Year | **7.4** | **5.9** | +25.4% | - The decrease in revenue was primarily due to a reduction in the number of large contract construction projects undertaken in the current year compared to the previous year[8](index=8&type=chunk) - The expanded net loss was mainly attributable to (i) the recognition of impairment losses totaling approximately **0.8 million HKD** on property, plant and equipment and right-of-use assets, and (ii) the reversal of deferred tax assets recognized in prior years[7](index=7&type=chunk)[11](index=11&type=chunk)[12](index=12&type=chunk) [Outlook and Strategy](index=6&type=section&id=%E5%89%8D%E6%99%AF) The Group anticipates a continuously challenging and competitive business environment, exacerbated by COVID-19, yet management remains cautiously optimistic about long-term opportunities in the construction market, focusing on foundation, site formation, and superstructure works while seeking other investment opportunities to diversify revenue - Facing challenges, the Group will continue to execute business strategies including (i) expanding market share to secure more foundation and superstructure projects, and (ii) adhering to prudent financial management principles to ensure sustainable growth[13](index=13&type=chunk) - The Board will consider other investment opportunities to expand revenue streams and generate optimal returns for shareholders[14](index=14&type=chunk) [Liquidity and Financial Resources](index=6&type=section&id=%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 financial position this fiscal year, with significantly increased bank balances and cash, a high current ratio, and a slightly increased but still very low gearing ratio at period-end, which management deems sufficient to support business expansion Liquidity and Financial Resources Summary | Financial Indicator | June 30, 2021 | June 30, 2020 | | :--- | :--- | :--- | | Bank Balances and Cash | Approx. **49.4 million HKD** | Approx. **38.0 million HKD** | | Current Ratio | Approx. **8.3 times** | Approx. **8.8 times** | | Gearing Ratio | Approx. **1.2%** | Approx. **1.0%** | - As of June 30, 2021, the Group pledged approximately **2.1 million HKD** in deposits as collateral for performance guarantees[17](index=17&type=chunk) [Employees and Remuneration Policy](index=7&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) At fiscal year-end, the Group's employee count slightly increased, while total staff costs decreased; remuneration policy is based on position, qualifications, and performance, with a share option scheme for incentives, though no options were granted during the reporting period Employee and Staff Cost Summary | Indicator | June 30, 2021 | June 30, 2020 | | :--- | :--- | :--- | | Total Employees | **21 persons** | **18 persons** | | Staff Costs (Annual) | Approx. **8.6 million HKD** | Approx. **10.4 million HKD** | [Dividends and Dividend Policy](index=8&type=section&id=%E8%82%A1%E6%81%AF%E5%8F%8A%E8%82%A1%E6%81%AF%E6%94%BF%E7%AD%96) The company has adopted a dividend policy where payout decisions consider the Group's financial performance, capital needs, and overall economic conditions, with the Board recommending no final dividend for the current year - The Board does not recommend a final dividend for the year ended June 30, 2021, consistent with the previous year[29](index=29&type=chunk) [Biographical Details of Directors](index=9&type=section&id=%E8%91%A3%E4%BA%8B%E5%B1%A5%E6%AD%B7%E8%A9%B3%E6%83%85) This section provides detailed biographical information for the company's executive and independent non-executive directors, highlighting their extensive professional experience and qualifications [Executive Directors](index=9&type=section&id=%E5%9F%B7%E8%A1%8C%E8%91%A3%E4%BA%8B) This section outlines the backgrounds of the executive directors, who possess decades of extensive experience in the construction and engineering industries, overseeing the Group's daily management, project bidding, and technical supervision - Chairman Mr. Kam Kin Bun has over **38 years** of experience in the Hong Kong construction industry, primarily responsible for the Group's daily management and bidding[31](index=31&type=chunk) - Mr. Hung Cheung Fai, a co-founder of the Group and Technical Director, possesses over **45 years** of experience in the construction industry and holds multiple professional engineer qualifications[32](index=32&type=chunk)[33](index=33&type=chunk) - Ms. Wong Mei Chun was appointed Executive Director on July 28, 2021, bringing over **25 years** of experience in the construction and electrical engineering industries[33](index=33&type=chunk) [Independent Non-Executive Directors](index=10&type=section&id=%E7%8D%A8%E7%AB%8B%E9%9D%9E%E5%9F%B7%E8%A1%8C%E8%91%A3%E4%BA%8B) This section presents the biographies of the independent non-executive directors, all possessing extensive professional backgrounds and experience in accounting, auditing, or corporate finance, and holding positions in multiple listed companies - Independent Non-Executive Directors Ms. Chan Sin Wah, Mr. Leung Chi Hung, and Mr. Yu Tat Chi are all accounting professionals holding membership or fellowship with the Hong Kong Institute of Certified Public Accountants[34](index=34&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) - Several independent non-executive directors concurrently serve as independent non-executive directors in other listed companies on the Stock Exchange[36](index=36&type=chunk)[37](index=37&type=chunk) [Corporate Governance Report](index=11&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%A0%B1%E5%91%8A) This report details the company's corporate governance practices, including board responsibilities, committee structures, and risk management, affirming compliance with the Code on Corporate Governance with one noted deviation [Corporate Governance Practices](index=11&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The company is committed to maintaining high corporate governance standards, adhering to all applicable Code on Corporate Governance provisions during the reporting period, with the sole deviation being the combined roles of Chairman and Chief Executive Officer held by Mr. Kam Kin Bun, which the Board believes enhances management efficiency - During the reporting period, the company deviated from Code on Corporate Governance provision A.2.1, where the roles of Chairman and Chief Executive Officer were not separated, both held by Mr. Kam Kin Bun[39](index=39&type=chunk)[45](index=45&type=chunk) - The Board believes that Mr. Kam's dual role, given his management of core subsidiaries since **2004**, enhances management efficiency and business development, aligning with the Group's best interests[39](index=39&type=chunk)[45](index=45&type=chunk) [Board of Directors](index=12&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83) This section details the Board's responsibilities, composition, independence, appointment and re-election mechanisms, and diversity policy, highlighting its oversight of significant matters including strategy, financial control, and risk management, with independent non-executive directors comprising over one-third of the Board during the reporting period, in compliance with regulations - The Board is responsible for fulfilling corporate governance duties, including formulating and reviewing governance policies, monitoring director training, and ensuring legal compliance[41](index=41&type=chunk)[42](index=42&type=chunk) - The company has adopted a Board Diversity Policy considering gender, age, cultural background, and professional experience in its composition, with two female directors on the Board during the reporting period[48](index=48&type=chunk) Board Composition by Age Group and Professional Experience | Director Name | Age Group | Professional Experience | | :--- | :--- | :--- | | Mr. Hung Cheung Fai | 60 and above | Business and Management, Construction | | Mr. Kam Kin Bun | 60 and above | Business and Management, Construction | | Ms. Wong Mei Chun | 60 and above | Business and Management, Construction | | Ms. Chan Sin Wah | 40–59 | Accounting and Finance | | Mr. Leung Chi Hung | 60 and above | Accounting and Finance | | Mr. Yu Tat Chi | 40–59 | Accounting and Finance | [Board Committees](index=16&type=section&id=%E8%91%A3%E4%BA%8B%E5%A7%94%E5%93%A1%E6%9C%83) The company has established three Board committees—Audit, Nomination, and Remuneration—each predominantly or chaired by independent non-executive directors to ensure independence and professionalism, with this section detailing their responsibilities, composition, and work during the reporting period Director Attendance at Meetings | Director/Committee | Board | Audit Committee | Nomination Committee | Remuneration Committee | Annual General Meeting | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Kam Kin Bun | 7/7 | N/A | N/A | N/A | 1/1 | | Mr. Hung Cheung Fai | 7/7 | N/A | N/A | N/A | 1/1 | | Mr. Leung Chi Hung | 7/7 | 5/5 | 1/1 | 1/1 | 1/1 | [Audit Committee](index=16&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, composed of independent non-executive directors and chaired by Mr. Leung Chi Hung who possesses accounting qualifications, is primarily responsible for overseeing financial statement integrity, reviewing external auditor independence and performance, and assessing the company's financial, risk management, and internal control systems - The Audit Committee's primary responsibilities include advising on external auditor appointment, monitoring financial statement integrity, and reviewing financial, risk management, and internal control systems[54](index=54&type=chunk) - During the reporting period, the Audit Committee held meetings to review the independence of the independent auditor, financial reporting, and the effectiveness of risk management and internal control systems[55](index=55&type=chunk) [Nomination Committee](index=17&type=section&id=%E6%8F%90%E5%90%8D%E5%A7%94%E5%93%A1%E6%9C%83) The Nomination Committee reviews the Board's structure, size, and composition, identifies suitable director candidates, assesses the independence of independent non-executive directors, and proposes director appointments and re-appointments to the Board based on the company's nomination and diversity policies - The Nomination Committee's main responsibilities include reviewing the Board structure, identifying suitable director candidates, assessing the independence of independent non-executive directors, and making recommendations on director appointments[56](index=56&type=chunk) [Remuneration Committee](index=17&type=section&id=%E8%96%AA%E9%85%AC%E5%A7%94%E5%93%A1%E6%9C%83) The Remuneration Committee is responsible for formulating the company's remuneration policy and advising the Board on the remuneration of executive directors and senior management, ensuring a formal, transparent, and independent remuneration determination process - The Remuneration Committee is responsible for formulating remuneration policies and reviewing the remuneration of executive directors, senior management, and independent non-executive directors before making recommendations to the Board[58](index=58&type=chunk)[59](index=59&type=chunk) [Risk Management and Internal Control](index=21&type=section&id=%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86%E5%8F%8A%E5%85%A7%E9%83%A8%E7%9B%A3%E6%8E%A7) The Group has established risk management and internal control systems, with the Board overseeing their effectiveness through at least annual reviews; given the relatively simple company structure, no internal audit department is currently in place, but internal control reviews have been conducted for financial, operational, and risk management functions, which the Board deems sufficiently effective - Risk management procedures involve three steps: risk identification, assessment, and mitigation, conducted or updated annually[73](index=73&type=chunk) - Due to the relatively simple company and operational structure, the Group has not established an internal audit department, but annual risk management and internal control reviews have been conducted, which the Board considers sufficiently effective[74](index=74&type=chunk) [Directors' Report](index=23&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%A0%B1%E5%91%8A) This report outlines the company's principal activities, performance, key risks, customer and supplier concentration, and disclosures of interests, along with compliance matters including public float and auditor changes [Principal Activities and Performance](index=23&type=section&id=%E4%B8%BB%E7%87%9F%E6%A5%AD%E5%8B%99) The company is an investment holding company, with the Group's principal activities being the provision of specialized engineering (foundation, demolition, land surveying) and general building works in Hong Kong; this year's performance is detailed on page 38 of the financial report, and the Board does not recommend a final dividend - The Group's principal activities are the provision of specialized engineering (including foundation and site formation, demolition, and on-site land surveying) and general building works in Hong Kong[80](index=80&type=chunk) - The Directors do not recommend the payment of a final dividend for the year ended June 30, 2021[88](index=88&type=chunk) [Key Risks and Uncertainties](index=23&type=section&id=%E4%B8%BB%E8%A6%81%E9%A2%A8%E9%9A%AA%E5%8F%8A%E4%B8%8D%E7%A2%BA%E5%AE%9A%E5%9B%A0%E7%B4%A0) The Group's key risks include business reliance on securing non-recurring projects, potential cost overruns from inaccurate project cost estimations, dependence on subcontractors, client credit risk, and the overall trends and macroeconomic conditions of the Hong Kong construction industry - Revenue is dependent on the successful bidding of non-recurring projects, leading to uncertainty[86](index=86&type=chunk) - Inaccurate project cost estimations or delayed completion may lead to cost overruns[86](index=86&type=chunk) - Business performance relies on subcontractors and is affected by client credit risk and the overall trends in the Hong Kong construction industry[95](index=95&type=chunk) [Major Customers and Suppliers](index=26&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) This fiscal year, the Group experienced very high customer concentration, with the largest client accounting for nearly **60%** of total revenue and the top five clients over **97%**; supplier concentration was also high, with the top five suppliers representing nearly **70%** of total purchases Customer and Supplier Concentration | Concentration Indicator | FY2021 | FY2020 | | :--- | :--- | :--- | | Largest Customer as % of Total Revenue | **59.7%** | **39.8%** | | Top Five Customers as % of Total Revenue | **97.4%** | **76.7%** | | Largest Supplier as % of Total Purchases | **40.9%** | **15.7%** | | Top Five Suppliers as % of Total Purchases | **68.6%** | **52.9%** | [Disclosure of Interests](index=30&type=section&id=%E6%AC%8A%E7%9B%8A%E6%8A%AB%E9%9C%B2) This section discloses the interests of directors, chief executives, and substantial shareholders in the company's shares, noting that Executive Directors Mr. Kam Kin Bun and Mr. Hung Cheung Fai indirectly hold **57.66%** of the company's shares through their controlling entity, Top Talent Ventures Limited, and also details other substantial shareholders' holdings Directors' and Chief Executives' Interests in Shares | Director Name | Capacity | Number of Shares Held | Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Kam Kin Bun | Interest in a controlled corporation | **576,600,000** | **57.66%** | | Mr. Hung Cheung Fai | Interest in a controlled corporation | **576,600,000** | **57.66%** | Substantial Shareholders' Interests in Shares | Name of Substantial Shareholder | Nature of Interest | Number of Shares Held | Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Top Talent | Beneficial owner | **576,600,000** | **57.66%** | | China Silver Asset Management Limited | Investment manager | **140,140,000** | **14.01%** | | CS Asia Opportunities Master Fund | Beneficial owner | **140,140,000** | **14.01%** | [Compliance Matters](index=31&type=section&id=%E5%85%85%E8%B6%B3%E5%85%AC%E7%9C%BE%E6%8C%81%E8%82%A1%E9%87%8F) During the reporting period, the company's public float temporarily fell below the GEM Listing Rules' **25%** requirement but was restored to approximately **25.03%** on March 22, 2021, after the controlling shareholder sold **1.2%** of shares; additionally, the company changed its auditor on July 9, 2020 - The company's public float once fell below the **25%** requirement but was restored to approximately **25.03%** on March 22, 2021, after controlling shareholder Top Talent sold **1.2%** of its shares, meeting the Listing Rules' requirements[132](index=132&type=chunk) - PricewaterhouseCoopers resigned as the company's auditor on July 9, 2020, and Crowe (HK) CPA Limited was appointed as the new auditor on the same day[134](index=134&type=chunk) [Independent Auditor's Report](index=34&type=section&id=%E7%8D%A8%E7%AB%8B%E6%A0%B8%E6%95%B8%E5%B8%AB%E5%A0%B1%E5%91%8A) This report presents the independent auditor's opinion on the consolidated financial statements, affirming their fair presentation and compliance with accounting standards, and highlights key audit matters related to construction contract valuation and expected credit loss provisions [Opinion](index=34&type=section&id=%E6%84%8F%E8%A6%8B) Independent auditor Crowe (HK) CPA Limited believes the Group's consolidated financial statements fairly and accurately reflect its financial position, performance, and cash flows in accordance with Hong Kong Financial Reporting Standards, and are properly prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance, issuing an unmodified opinion - The auditor issued an unmodified opinion (i.e., a standard, unqualified opinion) on the consolidated financial statements[144](index=144&type=chunk) [Key Audit Matters](index=34&type=section&id=%E9%97%9C%E9%8D%B5%E5%AF%A9%E8%A8%88%E4%BA%8B%E9%A0%85) The auditor identified two key audit matters: the measurement of construction contract value, critical for revenue recognition and involving significant estimation; and the provision for expected credit losses on trade and retention receivables and contract assets, due to their material balances and the significant judgment required for assessment - Key Audit Matter One: Measurement of construction contract value; given its criticality to revenue and significant estimation, the auditor focused on this area, concluding that management's judgments and estimates were supported by evidence after evaluating controls, reviewing contracts, and assessing management's estimates[147](index=147&type=chunk) - Key Audit Matter Two: Provision for expected credit losses on receivables and contract assets; due to the material balances and significant judgment involved in assessing provisions, the auditor focused on this area, concluding that management's judgments and estimates were supported by evidence after understanding credit procedures, evaluating modeling methodologies, and forward-looking information[148](index=148&type=chunk) [Consolidated Financial Statements](index=40&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) This section presents the Group's consolidated financial statements, including the statement of profit or loss and other comprehensive income, statement of financial position, statement of changes in equity, and statement of cash flows [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=40&type=section&id=%E7%B6%9C%E5%90%88%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) This statement presents the Group's operating results for the fiscal year, showing revenue of **33.83 million HKD**, a **44.8%** year-on-year decrease, and a loss for the year and total comprehensive loss of **7.40 million HKD**, representing a **25.4%** increase in loss year-on-year Consolidated Statement of Profit or Loss and Other Comprehensive Income | Item (Thousand HKD) | 2021 | 2020 | | :--- | :--- | :--- | | Revenue | **33,826** | **61,215** | | Gross Profit | **2,124** | **2,398** | | Loss Before Income Tax | **(6,472)** | **(6,909)** | | Loss and Total Comprehensive Loss for the Year | **(7,396)** | **(5,874)** | | Basic Loss Per Share (HK cents) | **(0.7)** | **(0.6)** | [Consolidated Statement of Financial Position](index=41&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) This statement reflects the Group's assets, liabilities, and equity at fiscal year-end; as of June 30, 2021, total assets were **65.495 million HKD**, total liabilities were **8.05 million HKD**, and net assets were **57.445 million HKD**, a decrease from the prior year Consolidated Statement of Financial Position | Item (Thousand HKD) | June 30, 2021 | June 30, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Non-current Assets | **68** | **1,945** | | Current Assets | **65,427** | **71,065** | | **Total Assets** | **65,495** | **73,010** | | **Liabilities and Equity** | | | | Current Liabilities | **7,899** | **8,037** | | Non-current Liabilities | **151** | **132** | | **Total Liabilities** | **8,050** | **8,169** | | **Net Assets** | **57,445** | **64,841** | | **Total Equity** | **57,445** | **64,841** | [Consolidated Statement of Changes in Equity](index=43&type=section&id=%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) This statement illustrates changes in each component of shareholders' equity during the fiscal year, with total equity decreasing from **64.841 million HKD** at the beginning of the year to **57.445 million HKD** at year-end, primarily due to the total comprehensive loss of **7.396 million HKD** for the year Consolidated Statement of Changes in Equity | Item (Thousand HKD) | Share Capital | Share Premium | Other Reserves | Retained Earnings | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | As at July 1, 2020 | **10,000** | **36,855** | **10,100** | **7,886** | **64,841** | | Loss and Total Comprehensive Loss for the Year | – | – | – | **(7,396)** | **(7,396)** | | As at June 30, 2021 | **10,000** | **36,855** | **10,100** | **490** | **57,445** | [Consolidated Statement of Cash Flows](index=44&type=section&id=%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) This statement summarizes cash inflows and outflows from operating, investing, and financing activities during the fiscal year, showing net cash inflow from operating activities of **12.08 million HKD**, a net increase in cash and cash equivalents of **11.451 million HKD**, and an ending balance of **49.447 million HKD** Consolidated Statement of Cash Flows | Item (Thousand HKD) | 2021 | 2020 | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | **12,080** | **8,939** | | Net Cash from/(used in) Investing Activities | **62** | **(34)** | | Cash Flows Used in Financing Activities | **(691)** | **(635)** | | Increase in Cash and Cash Equivalents | **11,451** | **8,270** | | Cash and Cash Equivalents at Beginning of Year | **37,996** | **29,726** | | Cash and Cash Equivalents at End of Year | **49,447** | **37,996** | [Notes to the Consolidated Financial Statements](index=45&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed notes on the Group's accounting policies, financial and capital risk management, critical accounting estimates, major asset and liability items, and events occurring after the reporting period [2 Application of Amendments to Hong Kong Financial Reporting Standards](index=45&type=section&id=2%20%E6%87%89%E7%94%A8%E9%A6%99%E6%B8%AF%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%EF%BC%88%E3%80%8C%E9%A6%99%E6%B8%AF%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%E3%80%8D%EF%BC%89%E4%BF%AE%E8%A8%82%E6%9C%AC) This section outlines the basis of preparation and significant accounting policies for the consolidated financial statements, which are prepared under Hong Kong Financial Reporting Standards on a historical cost basis, with key policies including revenue recognition over time using the output method, impairment assessment of financial instruments under the expected credit loss model, and lease accounting under HKFRS 16 - The Group recognizes revenue from construction contracts over time using the output method, measured by the value of services transferred to the customer to date[247](index=247&type=chunk) - The Group applies a simplified approach to trade and retention receivables and contract assets, always recognizing expected credit losses (ECL) for the entire lifetime[211](index=211&type=chunk)[213](index=213&type=chunk) - The Group has applied HKFRS 16, recognizing most leases as right-of-use assets and lease liabilities, while applying exemptions for short-term and low-value leases[191](index=191&type=chunk) [4 Financial and Capital Risk Management](index=66&type=section&id=4%20%E8%B2%A1%E5%8B%99%E9%A2%A8%E9%9A%AA%E5%8F%8A%E8%B3%87%E6%9C%AC%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86) The Group's primary financial risks are credit and liquidity risks, with interest rate risk being relatively insignificant; credit risk is managed through client credit assessments and provisions under the expected credit loss model, while liquidity risk is managed via internal cash resources, and capital structure is monitored using a low debt-to-asset ratio - The Group's primary financial risks are credit risk and liquidity risk; interest rate risk is not significant due to the relatively small scale of fixed-rate liabilities and cash balances[260](index=260&type=chunk)[261](index=261&type=chunk) - To manage credit risk, the Group assesses impairment for trade and contract receivables using the expected credit loss model, grouping them based on internal credit ratings[262](index=262&type=chunk) - The Group monitors capital using the debt-to-asset ratio, which was **1.0%** as of June 30, 2021, indicating a robust capital structure[273](index=273&type=chunk)[274](index=274&type=chunk) [5 Critical Accounting Estimates and Judgements](index=73&type=section&id=5%20%E9%97%9C%E9%8D%B5%E6%9C%83%E8%A8%88%E4%BC%B0%E8%A8%88%E5%8F%8A%E5%88%A4%E6%96%B7) Financial statement preparation involves two critical accounting estimates and judgments: the measurement of construction contract value, directly impacting revenue recognition amount and timing; and the provision for expected credit losses on trade and retention receivables and contract assets, requiring assumptions based on historical data and forward-looking information - Critical Estimate One: Measurement of construction contract value; management must recognize revenue by measuring completed works and estimating the value of uncertified works, involving significant judgment[277](index=277&type=chunk) - Critical Estimate Two: Provision for expected credit losses on receivables and contract assets; management must make judgments based on assumptions regarding default risk and expected loss rates[278](index=278&type=chunk) [16 Trade and Retention Receivables](index=81&type=section&id=16%20%E6%87%89%E6%94%B6%E8%B2%A1%E6%98%93%E8%B3%A6%E6%AC%BE%E5%8F%8A%E6%87%89%E6%94%B6%E5%B7%A5%E7%A8%8B%E9%A0%85%E7%9B%AE%E4%BF%9D%E7%95%99%E9%87%91) This section details the composition of various assets and liabilities; at fiscal year-end, the Group's property, plant and equipment and right-of-use assets had zero net book value due to impairment, while trade and contract receivables, though significantly reduced from last year, remained major components of current assets, and trade and retention payables were primary current liabilities - Due to impairment losses recognized, the net book value of both property, plant and equipment and right-of-use assets was zero as of June 30, 2021[303](index=303&type=chunk)[305](index=305&type=chunk) Key Asset and Liability Balances | Item (Thousand HKD) | June 30, 2021 | June 30, 2020 | | :--- | :--- | :--- | | Trade and Retention Receivables (Net) | **271** | **4,771** | | Contract Assets (Net) | **12,301** | **18,684** | | Trade and Retention Payables | **5,094** | **5,259** | - As of June 30, 2021, the Group had unutilized tax losses of approximately **11.255 million HKD**, but no deferred tax assets were recognized due to the unpredictability of future profit streams[330](index=330&type=chunk) [32 Events After the Reporting Period](index=95&type=section&id=32%20%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E4%BB%B6) Subsequent to the reporting period, the company's controlling shareholder, Top Talent Ventures Limited, sold all its shares in the company, approximately **57.66%** of the total issued shares, on July 21, 2021, after which Top Talent Ventures no longer holds any company shares - On July 21, 2021, controlling shareholder Top Talent Ventures Limited sold all its **576,600,000** company shares (approximately **57.66%**) in the open market[340](index=340&type=chunk) [Financial Summary](index=96&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) This section provides a concise overview of the Group's financial performance, assets, and liabilities over the past five fiscal years [Five-Year Financial Summary](index=96&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) This section provides a summary of the Group's performance, assets, and liabilities over the past five fiscal years, indicating significant fluctuations in revenue and profitability, with FY2021 revenue and net assets being among the lowest in the period Five-Year Performance Summary | Performance (Thousand HKD) | 2021 | 2020 | 2019 | 2018 | 2017 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | **33,826** | **61,215** | **82,775** | **44,995** | **75,370** | | Loss/(Profit) for the Year | **(7,396)** | **(5,874)** | **6,436** | **(9,563)** | **9,467** | Five-Year Assets and Liabilities Summary | Assets and Liabilities (Thousand HKD) | 2021 | 2020 | 2019 | 2018 | 2017 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | **65,495** | **73,010** | **82,630** | **78,895** | **56,232** | | Total Liabilities | **8,050** | **8,169** | **11,915** | **9,693** | **21,322** | | Net Assets | **57,445** | **64,841** | **70,715** | **69,202** | **34,910** |

[Company Information](index=3&type=section&id=Company%20Information) [Company Overview](index=3&type=section&id=Company%20Overview) This section provides fundamental information about WT Group Holdings Limited, including board members, committee structures, registered office, principal place of business, legal advisors, auditors, and stock code - The company's Board of Directors comprises Executive Directors Mr. Kam Kin Pan (Chairman) and Mr. Hung Cheung Fai, along with three independent non-executive directors[2](index=2&type=chunk) - The company's auditor is National Auditing Firm Limited[3](index=3&type=chunk) - The company's shares are listed on the GEM of the Hong Kong Stock Exchange under stock code **8422**[3](index=3&type=chunk) [Financial Performance](index=4&type=section&id=Financial%20Performance) [Consolidated Financial Statements](index=4&type=section&id=Consolidated%20Financial%20Statements) The Group's unaudited consolidated financial statements for the nine months ended March 31, 2021, show a significant decrease in revenue but an increase in gross profit, leading to a narrowed net loss attributable to owners of HKD 2.22 million, an improvement from HKD 4.68 million in the prior period Summary of Results for the Nine Months Ended March 31, 2021 | Indicator | Nine Months Ended March 31, 2021 (HKD Thousands) | Nine Months Ended March 31, 2020 (HKD Thousands) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 21,014 | 50,812 | -58.6% | | Gross Profit | 2,563 | 1,122 | +128.4% | | Loss Before Income Tax | (2,284) | (5,406) | Loss narrowed | | Loss for the Period | (2,220) | (4,680) | Loss narrowed | | Basic Loss Per Share (HK Cents) | (0.22) | (0.47) | Loss narrowed | - As of March 31, 2021, total equity attributable to owners of the company was **HKD 62.621 million**, a decrease from **HKD 64.841 million** as of July 1, 2020, primarily due to the loss incurred during the period[5](index=5&type=chunk) [Notes to the Financial Statements](index=6&type=section&id=Notes%20to%20the%20Financial%20Statements) The notes to the financial statements provide detailed explanations of the results, indicating the Group's primary engagement in specialized and general building engineering in Hong Kong as a single operating segment, with details on revenue recognition, expense composition, taxation, and earnings per share calculation, noting no dividends were distributed during the period - The Group primarily engages in specialized and general building engineering in Hong Kong, with all operations considered a single operating segment, thus no segment information is presented[6](index=6&type=chunk)[13](index=13&type=chunk) - For the nine months ended March 31, 2021, total employee benefit expenses were **HKD 6.842 million**, a decrease from **HKD 7.570 million** in the prior corresponding period[14](index=14&type=chunk)[15](index=15&type=chunk) - The Directors do not recommend the payment of a dividend for the nine months ended March 31, 2021[21](index=21&type=chunk) Loss Per Share Calculation | Item | Nine Months Ended March 31, 2021 | Nine Months Ended March 31, 2020 | | :--- | :--- | :--- | | Loss Attributable to Owners of the Company (HKD Thousands) | (2,220) | (4,680) | | Weighted Average Number of Ordinary Shares | 1,000,000,000 | 1,000,000,000 | | Basic and Diluted Loss Per Share (HK Cents) | (0.22) | (0.47) | [Management Discussion and Analysis](index=11&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Future Prospects](index=11&type=section&id=Business%20Review%20and%20Future%20Prospects) The Group engages in foundation, demolition, and general building engineering in Hong Kong, with net loss narrowing from HKD 4.7 million to HKD 2.2 million due to improved project mix leading to higher gross profit and reduced administrative expenses; management remains cautiously optimistic about long-term development despite industry challenges, focusing on core business and new opportunities - For the nine months ended March 31, 2021, the decrease in net loss was primarily due to increased gross profit from an improved project mix and reduced administrative expenses resulting from lower employee benefit expenses and depreciation[22](index=22&type=chunk) - Management anticipates that the Hong Kong construction industry will face challenges in the coming year, including intense competition and difficulties in securing contracts, which may impact financial performance[23](index=23&type=chunk) - The Group will continue to expand its market share, pursue more foundation and superstructure projects, adhere to prudent financial management principles, and may consider other investment opportunities to broaden its return base[23](index=23&type=chunk)[24](index=24&type=chunk) [Financial Review](index=12&type=section&id=Financial%20Review) This section provides a detailed analysis of the period's financial performance, noting a 58.7% year-on-year revenue decrease due to fewer large contract projects, yet gross profit and margin significantly increased to 12.2% from 2.2% due to a more favorable project mix, while administrative expenses decreased by 16.7%, collectively narrowing the loss attributable to owners by 53.2% Financial Performance Review (Nine Months Ended March 31) | Indicator | 2021 (HKD Million) | 2020 (HKD Million) | Change | Reason | | :--- | :--- | :--- | :--- | :--- | | Revenue | 21.0 | 50.8 | -58.7% | Decrease in the number of large contract construction projects | | Gross Profit | 2.6 | 1.1 | +136.4% | Higher gross profit generated from project mix | | Gross Margin | 12.2% | 2.2% | Increase | Higher gross profit generated from project mix | | Administrative Expenses | 5.5 | 6.6 | -16.7% | Decrease in employee benefit expenses and depreciation | | Loss Attributable to Owners | 2.2 | 4.7 | -53.2% | Increase in gross profit and decrease in administrative expenses | [Other Disclosures and Corporate Governance](index=13&type=section&id=Other%20Disclosures%20and%20Corporate%20Governance) [Disclosure of Interests](index=13&type=section&id=Disclosure%20of%20Interests) This section discloses the shareholdings of directors, chief executives, and substantial shareholders, noting that controlling shareholder Tak Wing Ventures Limited (jointly controlled by Mr. Hung Cheung Fai, Mr. Yip Siu Ching (deceased), and Mr. Kam Kin Pan) holds 62.66% of the company's shares, with China Silver Asset Management Limited also being a substantial shareholder holding 12.31% - Executive Directors Mr. Hung Cheung Fai, Mr. Yip Siu Ching (deceased), and Mr. Kam Kin Pan are deemed to collectively hold **626,600,000 shares**, representing **62.66%** of the total share capital, through their jointly controlled holding company, Tak Wing[30](index=30&type=chunk)[31](index=31&type=chunk) - Substantial shareholder China Silver Asset Management Limited and its associated fund, CS Asia Opportunities Master Fund, hold **123,140,000 shares**, representing **12.31%** of the company's total share capital[33](index=33&type=chunk) [Corporate Governance and Other Information](index=16&type=section&id=Corporate%20Governance%20and%20Other%20Information) This section covers various corporate governance matters and significant events, including the company's restoration of the 25% minimum public float requirement on March 22, 2021, a reported deviation from the Corporate Governance Code regarding the absence of a Chief Executive Officer, and key changes such as the passing of the former Chairman, appointment of a new Chairman, and auditor change, with the Audit Committee having reviewed the quarterly financial statements - On March 22, 2021, the company restored its public float to approximately **25.03%** by the controlling shareholder selling **1.2%** of shares, meeting GEM Listing Rules requirements[36](index=36&type=chunk) - The company reported a deviation from Corporate Governance Code provision A.2.1 due to the absence of a Chief Executive Officer, where the Board's management and daily business management responsibilities are not clearly segregated, which the Board believes contributes to management efficiency[39](index=39&type=chunk) - Several significant changes occurred during the reporting period: former Chairman Mr. Yip passed away on September 24, 2020; Executive Director Mr. Kam Kin Pan was appointed Compliance Officer and Authorized Representative on September 25, 2020, and subsequently Chairman on November 2, 2020[45](index=45&type=chunk)[46](index=46&type=chunk) - The company's auditor changed from PricewaterhouseCoopers to National Auditing Firm Limited, effective July 9, 2020[47](index=47&type=chunk) - The Audit Committee has reviewed the unaudited condensed consolidated financial statements for the quarter and considers them to be prepared in compliance with applicable accounting standards and GEM Listing Rules, with adequate disclosures made[49](index=49&type=chunk)

1 WT集團控股有限公司 香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM乃為較其他於聯交所上市之公司帶有較高投資風險之中小型公司提供一個上市之市場。 有意投資者應了解投資於該等公司之潛在風險，並應經過審慎周詳考慮後方作出投資決定。 鑑於GEM上市公司普遍為中小型公司，於GEM買賣之證券可能會較於聯交所主板買賣之證券 承受較大之市場波動風險，及無法保證於GEM買賣之證券會有高流通市場。 香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整性亦不發 表任何聲明，並明確表示概不對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 致之任何損失承擔任何責任。 本報告乃遵照聯交所《GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供有關WT集團 控股有限公司（「本公司」，連同其附屬公司稱為「本集團」）的資料。本公司董事（「董事」）願就 本報告的資料共同及個別地承擔全部責任。各董事在作出一切合理查詢後，確認就其深知及 確信，本報告所載資料在各重要方面均屬準確完備，沒有誤導或欺詐成分，及並無遺漏任何 其他事項，致使本報告或其所載任何陳述產生誤導。 2020/2021中期報告 2 公司資 ...

FIRST QUARTERLY REPORT 2020/2021 第一季度報告 2020/2021 1 WT集團控股有限公司 香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM乃為較其他於聯交所上市之公司帶有較高投資風險之中小型公司提供一個上市之市場。 有意投資者應了解投資於該等公司之潛在風險，並應經過審慎周詳考慮後方作出投資決定。 鑑於GEM上市公司普遍為中小型公司，於GEM買賣之證券可能會較於聯交所主板買賣之證券 承受較大之市場波動風險，及無法保證於GEM買賣之證券會有高流通市場。 香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整性亦不發 表任何聲明，並明確表示概不對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 致之任何損失承擔任何責任。 本報告乃遵照聯交所《GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供有關WT集團 控股有限公司（「本公司」，連同其附屬公司稱為「本集團」）的資料；本公司董事（「董事」）願就 本報告的資料共同及個別地承擔全部責任。各董事在作出一切合理查詢後，確認就其所知及 所信，本報告所載資料在各重要方面均屬準確完備，沒有誤導或欺詐成分，及 ...

香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM乃為較其他於聯交所上市之公司帶有較高投資風險之中小型公司提供一個上市之市場。有意投資者應了解投資於該 等公司之潛在風險，並應經過審慎周詳考慮後方作出投資決定。 鑑於GEM上市公司普遍為中小型公司，於GEM買賣之證券可能會較於聯交所主板買賣之證券承受較大之市場波動風險， 及無法保證於GEM買賣之證券會有高流通市場。 香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整性亦不發表任何聲明，並明確表示概 不對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之任何損失承擔任何責任。 本報告乃遵照聯交所《GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供有關WT集團控股有限公司（「本公司」，連 同其附屬公司稱為「本集團」）的資料；本公司董事（「董事」）願就本報告的資料共同及個別地承擔全部責任。各董事在作 出一切合理查詢後，確認就其所知、所悉及所信，本報告所載資料在各重要方面均屬準確完備，沒有誤導或欺詐成分， 及並無遺漏任何事項，致使本報告或其所載任何陳述產生誤導。 本報告乃以英文編製，其後翻譯成中文。中英文版本如有歧義，概以英文版 ...

香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整性亦不發 表任何聲明，並明確表示概不對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 致之任何損失承擔任何責任。 本報告乃遵照聯交所《GEM證券上市規則》（「GEM上市規則」）而刊載，旨在提供有關WT集團 控股有限公司（「本公司」，連同其附屬公司稱為「本集團」）的資料；本公司董事（「董事」）願就 本報告的資料共同及個別地承擔全部責任。各董事在作出一切合理查詢後，確認就其所知及 所信，本報告所載資料在各重要方面均屬準確完備，沒有誤導或欺詐成分，及並無遺漏任何 其他事項，致使本報告或其所載任何陳述產生誤導。 2019/2020第三季度業績報告 2 公司資料 董事會 執行董事： 葉韶青先生 （主席） 孔祥輝先生 甘健斌先生 1 WT集團控股有限公司 香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM乃為較其他於聯交所上市之公司帶有較高投資風險之中小型公司提供一個上市之市場。 有意投資者應了解投資於該等公司之潛在風險，並應經過審慎周詳考慮後方作出投資決定。 鑑於GEM上市公司普遍為中小型公司，於GEM買賣之證券可能會較於聯交所主板買賣 ...