[Part I - Corporate and Financial Information](index=6&type=section&id=Part%20I%20-%20Corporate%20and%20Financial%20Information) [Item 3. Key Information](index=6&type=section&id=Item%203.%20Key%20Information) Details the company's corporate structure, cash flow, reduced reporting status, and risks from PRC oversight and the HFCA Act - The company operates through a Cayman Islands holding company, Reitar Logtech Holdings Limited, with Hong Kong subsidiaries, explicitly avoiding a **Variable Interest Entity (VIE) structure**[20](index=20&type=chunk)[22](index=22&type=chunk) - Cash transfers between the Cayman holding company and Hong Kong subsidiaries occur via capital contributions, loans, or dividends, with **no current material impact from PRC laws**[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) - Qualifies as an **"emerging growth company"** under the JOBS Act, enabling reduced reporting requirements and an extended transition for new accounting standards[30](index=30&type=chunk)[31](index=31&type=chunk) - Despite Hong Kong operations, the company acknowledges risks from potential **PRC government oversight** that could materially impact operations and share value[33](index=33&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) - Auditor is subject to PCAOB inspection, but shares face **delisting risk from Nasdaq** under the HFCA Act if PCAOB cannot inspect auditors in mainland China or Hong Kong for two consecutive years[38](index=38&type=chunk)[40](index=40&type=chunk)[209](index=209&type=chunk) [Risk Factors](index=10&type=section&id=D.%20Risk%20Factors) - Business risks include dependency on Hong Kong and global economic conditions, reliance on **third-party suppliers**, long sales cycles, and significant upfront capital expenditure for its 'rent-to-rent' model[44](index=44&type=chunk)[45](index=45&type=chunk)[47](index=47&type=chunk)[49](index=49&type=chunk) - High customer concentration, with the **top five customers accounting for 97.1% of total revenue in fiscal year 2025**, poses a significant risk of losing major clients[72](index=72&type=chunk)[92](index=92&type=chunk) - Identified internal control weaknesses include **inadequate segregation of duties** and a **lack of U.S. GAAP-trained personnel**, potentially impacting accurate financial reporting[114](index=114&type=chunk)[115](index=115&type=chunk) - Jurisdictional risks arise from Hong Kong's legal system and potential **PRC government oversight**, which could materially alter operations or hinder securities offerings[159](index=159&type=chunk)[162](index=162&type=chunk)[169](index=169&type=chunk) - Shareholder risks include a **dual-class share structure** granting directors and principal shareholders **91.98% of total voting power**, limiting Class A shareholder influence, and potential delisting under the HFCA Act[203](index=203&type=chunk)[204](index=204&type=chunk)[209](index=209&type=chunk) [Item 4. Information on the Company](index=45&type=section&id=Item%204.%20Information%20on%20the%20Company) Reitar Logtech offers comprehensive logistics solutions in Hong Kong via asset management and construction services, leveraging a PLT model, while facing high customer concentration and extensive local regulations - The business model provides end-to-end logistics solutions, connecting capital partners, operators, and technology, operating through **Asset Management & Consultancy** and **Construction Management & Engineering** segments[241](index=241&type=chunk)[247](index=247&type=chunk) Financial Performance Snapshot (HK$) | Fiscal Year Ended March 31, | Revenue (HK$) | Net Income (HK$) | | :--- | :--- | :--- | | 2023 | 84.5 million | 63.6 million | | 2024 | 252.0 million | 19.6 million | | 2025 | 378.2 million | 2.4 million | - High customer concentration persists, with the **top five customers accounting for 88.3%, 94.6%, and 97.1% of total revenue** for fiscal years 2023, 2024, and 2025, respectively[283](index=283&type=chunk)[72](index=72&type=chunk) - Operations are subject to extensive Hong Kong regulations, including the **Buildings Ordinance**, **Public Health and Municipal Services Ordinance**, and various **environmental and safety laws**[309](index=309&type=chunk)[312](index=312&type=chunk)[324](index=324&type=chunk) [Item 5. Operating and Financial Review and Prospects](index=61&type=section&id=Item%205.%20Operating%20and%20Financial%20Review%20and%20Prospects) Revenue grew 50.1% to HK$378.2 million in FY2025, but gross profit margin declined to 15.9% and net income fell to HK$2.4 million, with negative operating cash flow and strategic Bitcoin purchase plans Revenue by Service Segment (HK$) | Service Segment | FY 2023 (HK$) | FY 2024 (HK$) | FY 2025 (HK$) | | :--- | :--- | :--- | :--- | | Construction management and engineering design services | 79.0M | 238.0M | 362.9M | | Asset management and professional consultancy services | 5.5M | 14.0M | 15.2M | | **Total Revenue** | **84.5M** | **252.0M** | **378.2M** | Key Financial Metrics Comparison | Metric | FY 2024 (HK$) | FY 2025 (HK$) | Change | | :--- | :--- | :--- | :--- | | Revenue | 252.0M | 378.2M | +50.1% | | Gross Profit | 64.1M | 60.1M | -6.2% | | Gross Profit Margin | 25.4% | 15.9% | -9.5 p.p. | | Net Income | 19.6M | 2.4M | -87.8% | | Net Cash from Operations | (18.7M) | (62.4M) | Worsened | - The **significant decrease in gross profit margin in FY2025** was primarily due to higher subcontracting costs for a major automated cold chain warehouse project and increased material costs[414](index=414&type=chunk)[416](index=416&type=chunk) - In June 2025, the company agreed to potentially purchase up to **15,000 BTC (valued at up to US$1.5 billion)** by issuing ordinary shares, aiming for a digital asset reserve and supporting decentralized finance[357](index=357&type=chunk) - A discontinued subleasing business generated a **one-time gain of HK$56.2 million in FY2023** from agreement termination and cold storage equipment transfer[360](index=360&type=chunk)[422](index=422&type=chunk) [Item 6. Directors, Senior Management and Employees](index=89&type=section&id=Item%206.%20Directors%2C%20Senior%20Management%20and%20Employees) Introduces the board and senior management, details their HK$7.3 million compensation, outlines key committees, and highlights the dual-class share structure concentrating 92% voting power with founders - The board comprises **seven directors**, including Chairman & CEO Kin Chung CHAN, President Hau Lim CHUNG, Chun Yip YIU, and **four independent directors**[522](index=522&type=chunk)[532](index=532&type=chunk) - Aggregate cash compensation for all directors and executive officers totaled **HK$7.3 million** for the fiscal year ended March 31, 2025[536](index=536&type=chunk) - The company's **dual-class share structure** grants directors and executive officers **91.98% of total voting power**, despite owning 71.60% of total share capital[559](index=559&type=chunk)[204](index=204&type=chunk) - The board established **Audit, Compensation, and Nomination and Corporate Governance Committees**, each composed of independent directors[542](index=542&type=chunk)[543](index=543&type=chunk)[546](index=546&type=chunk)[547](index=547&type=chunk) [Item 7. Major Shareholders and Related Party Transactions](index=96&type=section&id=Item%207.%20Major%20Shareholders%20and%20Related%20Party%20Transactions) Details related party transactions, including HK$12.6 million due from and HK$2.2 million due to related parties as of March 31, 2025, highlighting operational and financial interconnections Related Party Balances as of March 31, 2025 (HK$) | Balance Type | Amount (HK$) | Nature | | :--- | :--- | :--- | | Amount due from related parties | 12,602,227 | Unsecured, interest-free, non-trade | | Amount due to related parties | 2,167,267 | Unsecured, interest-free, non-trade | - In FY2025, significant related party transactions included **HK$16.6 million in subcontracting costs** to Smartmore LogTech International Group Limited and **HK$1.0 million in revenue** from Star Capital Investment Limited[570](index=570&type=chunk) - In FY2023, a **HK$3.6 million management fee** was paid to Kamui Group Development Limited, which ceased to be a related party after January 16, 2023, following its disposal by directors[570](index=570&type=chunk)[571](index=571&type=chunk) [Item 8. Financial Information](index=98&type=section&id=Item%208.%20Financial%20Information) Confirms inclusion of consolidated financial statements, absence of material legal proceedings, and the company's policy of retaining earnings for business expansion instead of paying dividends - The company has **not declared or paid cash dividends** and plans to retain earnings for business operations and expansion in the foreseeable future[575](index=575&type=chunk) - The company is **not currently a party to any legal or administrative proceedings** expected to have a material adverse effect on its business or financial condition[574](index=574&type=chunk) [Item 10. Additional Information](index=99&type=section&id=Item%2010.%20Additional%20Information) Outlines tax implications for investors, including no Cayman Islands taxes, Hong Kong profits tax rates, and the significant risk of **Passive Foreign Investment Company (PFIC)** classification for U.S. holders - The company, incorporated in the Cayman Islands, is **not subject to profits, income, gains, or appreciation taxes**, with no withholding tax on dividends paid to shareholders[589](index=589&type=chunk)[590](index=590&type=chunk) - Hong Kong operating subsidiaries are subject to a **16.5% profits tax rate**, with a two-tiered system applying **8.25% on the first HK$2 million** of assessable profits[592](index=592&type=chunk) - There is a risk of classification as a **Passive Foreign Investment Company (PFIC)** for U.S. federal income tax purposes, which would result in significant adverse tax consequences for U.S. Holders[224](index=224&type=chunk)[610](index=610&type=chunk)[611](index=611&type=chunk) [Item 11. Quantitative and Qualitative Disclosures About Market Risk](index=105&type=section&id=Item%2011.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Highlights significant customer and credit concentration risks, interest rate exposure from bank loans, minimal foreign currency risk due to HKD-USD peg, and geographical concentration in Hong Kong - Significant customer concentration risk exists, with **two customers accounting for 61.5% and 23.5% of total revenue** in fiscal year 2025[634](index=634&type=chunk) - As of March 31, 2025, **two customers accounted for 64.5% and 12.3% of contracts receivable**, and **two customers accounted for 51.6% and 44.9% of contract assets**, highlighting credit concentration[635](index=635&type=chunk)[636](index=636&type=chunk) - The company is exposed to **interest rate risk on its bank loans and balances**, lacking an interest rate hedging policy[476](index=476&type=chunk)[640](index=640&type=chunk) - Foreign currency risk is minimal due to primary exposure to the U.S. dollar and the **Hong Kong dollar's peg to the USD**[477](index=477&type=chunk)[641](index=641&type=chunk) [Part II - Compliance and Controls](index=108&type=section&id=Part%20II) Covers internal controls, governance, and compliance, including acknowledged material weaknesses, audit committee expertise, a change in certifying accountant, and cybersecurity risk management - Identified **inadequacies in internal control over financial reporting** as of March 31, 2025, including poor segregation of duties and a lack of U.S. GAAP-trained personnel[652](index=652&type=chunk)[653](index=653&type=chunk) - Mr. Ho Tung Armen HO is identified as the **'audit committee financial expert'** on the board of directors[657](index=657&type=chunk) - Effective June 23, 2025, **WWC, P.C. was dismissed** as the independent registered public accounting firm, and **Enrome LLP was appointed** as the successor auditor[665](index=665&type=chunk) - Implemented a **cybersecurity policy and risk management process**, overseen by the associate director of business strategy and innovation technology, to identify, assess, and manage threats[673](index=673&type=chunk)[675](index=675&type=chunk)[676](index=676&type=chunk) [Part III - Financial Statements and Exhibits](index=112&type=section&id=Part%20III) [Item 18. Financial Statements](index=112&type=section&id=Item%2018.%20Financial%20Statements) Presents audited consolidated financial statements for FY2023-2025, prepared under U.S. GAAP, including balance sheets, income statements, cash flows, and notes on accounting policies and risk exposures Consolidated Balance Sheet Summary (As of March 31, 2025) | Account | Amount (HK$) | Amount (US$) | | :--- | :--- | :--- | | **Total Assets** | **333,819,187** | **42,907,901** | | Total Current Assets | 278,865,899 | 35,844,405 | | **Total Liabilities** | **176,434,734** | **22,678,277** | | Total Current Liabilities | 176,434,734 | 22,678,277 | | **Total Shareholders' Equity** | **157,384,453** | **20,229,624** | Consolidated Statement of Income Summary (For the Year Ended March 31, 2025) | Account | Amount (HK$) | Amount (US$) | | :--- | :--- | :--- | | Total Revenue | 378,169,751 | 48,608,562 | | Gross Profit | 60,058,961 | 7,719,760 | | Income from Continuing Operation | 9,769,564 | 1,255,744 | | **Net Income** | **2,440,540** | **313,698** | | **EPS (Basic and Diluted)** | **0.13** | **0.02** | Consolidated Statement of Cash Flows Summary (For the Year Ended March 31, 2025) | Account | Amount (HK$) | Amount (US$) | | :--- | :--- | :--- | | Net cash used in operating activities | (62,354,617) | (8,014,834) | | Net cash used in investing activities | (8,749,679) | (1,124,652) | | Net cash provided by financing activities | 91,876,929 | 11,809,525 | | **Net increase in cash** | **20,772,633** | **2,670,039** | - Revenue recognition for primary services (construction management, engineering design, asset management, and consultancy) is based on the **percentage-of-completion method**, using contract costs incurred relative to total estimated costs[391](index=391&type=chunk)[402](index=402&type=chunk)[744](index=744&type=chunk)

Core Insights - Reitar Logtech has established Pine Forest Holdings to create a vertically integrated food supply chain, enhancing its smart agriculture ecosystem [1][2][3] Group 1: Subsidiary and Supply Chain Integration - Pine Forest Holdings will integrate approximately 1,333 hectares (20,000 mu) across eight agricultural bases in mainland China, supplying a variety of products directly to Hong Kong markets [2] - The subsidiary aims to build an efficient and transparent smart agriculture ecosystem through strategic partnerships with local markets [2] Group 2: Cold Chain and Food Safety - Reitar Logtech's automated cold chain warehouse in Kwai Chung, exceeding 200,000 square feet, will centralize cold storage and distribution, ensuring food safety and freshness [3] - The company is expanding its prepared food and processing operations to diversify local food supply [3] Group 3: Technological Innovations - Reitar Logtech has launched a digital asset reserve strategy totaling up to USD 1.5 billion, introducing RBTC and RHKD as key payment tools within the supply chain [4] - The integration of blockchain technology will enhance transparency and food safety through comprehensive data recording from origin to sales [7] Group 4: Industrial Synergy and Market Position - Pine Forest Holdings will pursue industrial synergy by acquiring high-quality food sources and logistics companies, improving food circulation efficiency and market responsiveness [5] - This strategy aims to consolidate Reitar Logtech's industry-leading position in the food supply chain [5] Group 5: Future Expansion Plans - Pine Forest Holdings plans to replicate its successful model in Southeast Asia, promoting digitalization and modernization of food circulation in the Greater Bay Area [6] - The initiative aims to provide consumers with safer and more efficient food choices [6] Group 6: Overall Vision - Reitar Logtech and Pine Forest Holdings are committed to driving upgrades in smart agriculture and food supply chains through technological innovation and collaboration [8]

Core Viewpoint - Reitar Logtech Holdings Limited and Rich Harvest Agricultural Produce Limited have signed a strategic MOU to develop a "Blockchain + Stablecoin + Smart Cold Chain" ecosystem for agricultural supply chains, aiming to enhance efficiency and traceability in cross-border agriculture [1][3]. Group 1: Collaboration Overview - The collaboration will integrate a blockchain-based traceability system with automated cold chain infrastructure, leveraging Rich Harvest's existing farming operations and Reitar's technological expertise [2][4]. - Rich Harvest operates eight farming bases across China, covering over 1,333 hectares (20,000 mu), and has established a "farm-to-table" traceability system using barcode and RFID tracking [2][5]. Group 2: Strategic Framework - The MOU outlines three key collaboration areas: blockchain traceability system development, digital payment integration, and smart cold chain integration [3][4]. - The collaboration will be executed in phases, with a focus on innovation in smart logistics and enhancing agricultural supply chain solutions for the Greater Bay Area and global markets [3][6]. Group 3: Implementation Plan - Phase 1, targeted for Q4 2025, involves launching a pilot project to export approximately 30 tons of fresh food daily from Rich Harvest's Guizhou farm to Hong Kong, utilizing IoT sensors and Reitar's cold storage facilities [4]. - Phase 2, targeted for Q1 2026, aims to onboard Hong Kong supermarkets to the digital payment system and retrofit cold chain fleets with blockchain temperature control [4]. Group 4: Company Background - Rich Harvest, founded in 2006, is a vertically integrated agriculture enterprise supplying fresh produce to Hong Kong, Macau, and mainland China, operating under a "Company + Farmers" model [5]. - Reitar Logtech, listed on NASDAQ in 2024, focuses on "Property + Logistics Technology" and aims to enhance logistics asset management and technology application for improved operational efficiency [6].

Core Viewpoint - Reitar Logtech Holdings Limited is initiating a spin-off of its logistics automation segment to enhance growth potential and shareholder value, following its acquisition of Jingxing Storage Equipment Engineering [1][2] Group 1: Spin-off Strategy - The spin-off aims to create an independent entity focused on smart warehousing and integrated logistics automation solutions, allowing for greater operational flexibility and innovation [2][3] - This strategic move is expected to attract partnerships and investments, reinforcing Reitar's leadership in the smart logistics industry [3] Group 2: MIS Strategy - Reitar is committed to its "MIS" strategy, which includes Mergers & Acquisitions, Integration, and Spin-offs, to strengthen core operations and maximize capital efficiency [4] - The company plans to continue pursuing acquisitions to integrate resources and develop comprehensive end-to-end solutions within the smart logistics ecosystem [3][4] Group 3: Company Overview - Reitar Logtech, listed on Nasdaq in 2024, specializes in integrated Property-Logistics Technology solutions, focusing on the full lifecycle management of logistics assets [5] - The company utilizes technology to enhance operational efficiency and economic returns, integrating smart warehouse systems and data analytics platforms [5]

Group 1 - The company, Domain Tower Logistics Technology, is actively researching relevant regulatory details [1] - The company plans to apply for a stablecoin issuance license after the stablecoin regulations in Hong Kong come into effect [1]