绿色经济(01315) - 2025 - 中期财报

Company Information This section provides fundamental company information, including board members, committee structures, registered office, and principal business locations Company Overview This section provides fundamental company information for Green Economic Development Limited, including board members, committee structures, registered office, principal place of business, auditors, principal bankers, share registrar, and company website - The Board of Directors includes Chairman and CEO Zhou Zhe, Executive Directors Wei Mingde, Zhu Feng, Feng Jialun, Tang Hongyang, Zhu Xiaodong, and Independent Non-Executive Directors Wang Weijun, Zhang Shengman, Li Xiaoting[11][17][294] - The Audit Committee comprises three independent non-executive directors: Mr Wang Weijun (Chairman), Mr Zhang Shengman, and Ms Li Xiaoting[9][305] - The company's registered office is in the Cayman Islands, with its principal place of business in Hong Kong located at Room 1001, 10/F, China Huarong Building, 60 Gloucester Road, Wan Chai[17][27] Management Discussion and Analysis This section provides a comprehensive review of the group's interim financial performance, business operations, future strategies, and financial position for the period Interim Results The group recorded revenue of approximately HKD 1,439 million for the half-year ended September 30, 2024, a decrease of approximately 5% year-on-year, but gross profit significantly increased due to higher profit margins in supply chain management and property maintenance, resulting in earnings per share of 0.41 HK cents, reversing the loss per share from the prior year Interim Results Overview | Metric | Half-year ended September 30, 2024 (HKD) | Half-year ended September 30, 2023 (HKD) | | :--- | :--- | :--- | | Revenue | 1,439 million | 1,519 million | | Revenue Change | Decreased by approx. 5% | - | | Gross Profit | 29.1 million | 17.9 million | | Gross Profit Change | Increased by approx. 11.2 million | - | | Earnings/(Loss) Per Share | 0.41 HK cents (profit) | (3.25) HK cents (loss) | | Profit/(Loss) Attributable to Owners of the Company | 2.2 million (profit) | (12.1) million (loss) | Business Review The group's business segments showed mixed performance, with supply chain management experiencing growth in both revenue and profit, property maintenance seeing reduced revenue but significantly increased profit, while building construction and alteration and addition works segments both declined, with the latter turning from profit to loss Segment Performance Overview (Half-year ended September 30, 2024) | Segment | 2024 Revenue (HKD) | 2023 Revenue (HKD) | 2024 Profit/(Loss) (HKD) | 2023 Profit/(Loss) (HKD) | | :--- | :--- | :--- | :--- | :--- | | Supply Chain Management | 1,224,709,000 | 1,133,072,000 | 9,527,000 (profit) | 3,975,000 (profit) | | Building Construction | 225,000 | 2,408,000 | 195,000 (profit) | 2,388,000 (profit) | | Alteration and Addition Works | 19,243,000 | 60,520,000 | (6,682,000) (loss) | 3,905,000 (profit) | | Property Maintenance and Repair | 195,309,000 | 322,615,000 | 25,781,000 (profit) | 5,695,000 (profit) | - The increase in profit for the supply chain management segment is attributed to an increase in segment profit margin[22] - The alteration and addition works segment turned from profit to loss, mainly due to increased operating costs and additional costs recognized for completed projects[59] - The increase in profit for the property maintenance and repair segment is primarily due to a significant increase in operating and subcontracting costs in the prior interim period[36] Future Plans and Prospects The group plans to diversify its business in 2024, particularly in supply chain management, by leveraging national policy support and market demand to establish a port blended ore integration platform and become a core supply chain enterprise for large domestic steel companies, while for the construction industry, the group will focus on controlling operating costs, maintaining liquidity, and selectively exploring other opportunities to mitigate business risks - The supply chain management business is expected to benefit from national policy support under the "14th Five-Year Plan for Iron Ore Industry Development," leading to an anticipated increase in industry penetration[39] - The iron ore market size has reached RMB 500 billion, with strong demand in the steel industry expected to continue as national infrastructure projects and downstream market demand recover[64] - The company aims to establish a port blended ore integration platform based on modern supply chain management to provide stable raw material supply for steel enterprises and develop proprietary supply chain management software systems[64] - Hong Kong's construction industry growth is expected to slow, facing risks such as skilled labor shortages, soaring costs, and intensified price competition[42][65] - The group maintains a cautiously optimistic outlook for the short-term prospects of the construction industry, focusing on controlling operating costs, maintaining liquidity and market competitiveness, and exploring other opportunities to mitigate business risks[66] Significant Acquisitions and Disposals of Subsidiaries and Associates The group completed the acquisition of the entire issued share capital of Runpeng Holdings Limited for a consideration of HKD 87,000 during the period, aiming to expand its supply chain management business, particularly in iron ore pre-processing and blended ore processing services - The company's wholly-owned subsidiary, Start Shinning Pte. Ltd., completed the acquisition of the entire issued share capital of Runpeng Holdings Limited (which holds an 85% equity interest in Rizhao Zhongkuang New Energy Technology Co., Ltd.) on September 13, 2024[45][67] - The acquisition consideration was HKD 87,000, with the target company primarily engaged in investment holding and trading, and the target subsidiary involved in iron ore pre-processing and blended ore processing services[45][67] Significant Corporate Events The group completed a rights issue on April 16, 2024, successfully raising gross proceeds of approximately HKD 27.67 million and net proceeds of approximately HKD 25.97 million Rights Issue Results | Metric | Amount (HKD) | | :--- | :--- | | Rights Issue Completion Date | April 16, 2024 | | Total Number of Rights Shares Applied | 171,876,373 shares | | Gross Proceeds from Rights Issue | Approx. 27.67 million | | Net Proceeds from Rights Issue | Approx. 25.97 million | Liquidity and Financial Resources The group maintains a sound financial position, with total cash and bank balances of approximately HKD 183.5 million as of September 30, 2024, a current ratio of 1.82, and a gearing ratio of approximately 27.4%, indicating ample liquidity and financial resources to meet business needs Financial Resources Overview | Metric | September 30, 2024 (HKD) | March 31, 2024 (HKD) | | :--- | :--- | :--- | | Total Cash and Bank Balances | Approx. 183.5 million | Approx. 150.0 million | | Current Assets | Approx. 748.4 million | Approx. 671.8 million | | Current Liabilities | Approx. 411.7 million | Approx. 469.7 million | | Current Ratio | 1.82 | 1.43 | | Total Interest-Bearing Loans | Approx. 207.3 million | Approx. 207.3 million | | Net Cash Balance | Approx. 183.3 million | Approx. 47.7 million | | Gearing Ratio | Approx. 27.4% | Approx. 30.5% | - The group has secured credit facilities of up to approximately HKD 69.5 million and trade finance facilities of up to approximately USD 50 million from various banks, with approximately HKD 12.2 million of the credit facilities utilized[50] Foreign Exchange and Interest Rate Risks The group adheres to prudent financial management principles, continuously monitors foreign exchange and interest rate risks, and considers hedging when necessary, currently without an interest rate hedging policy - The group currently has no interest rate hedging policy but continuously monitors interest rate risks and considers hedging when necessary[52] - The group primarily conducts business in HKD, USD, and RMB, and periodically reviews foreign exchange positions and market conditions to determine if hedging is required[75] Pledged Assets The group has pledged certain assets as collateral for bank financing and performance guarantees, with detailed information provided in Note 17 to the condensed consolidated financial statements - Details of the group's assets pledged as collateral for bank financing and performance guarantees are set out in Note 17 to the condensed consolidated financial statements[76] Contingent Liabilities Details of the group's significant contingent liabilities are set out in Note 18 to the condensed consolidated financial statements - The group's significant contingent liabilities as at September 30, 2024, are set out in Note 18 to the condensed consolidated financial statements[101] Events After Reporting Period There are no other significant matters after the reporting period that require disclosure to shareholders - There are no other matters after the reporting period that require disclosure to the company's shareholders[53] Progress of Uncompleted Contracts for the Six Months Ended September 30, 2024 This section details the progress of contracts awarded and completed by the group in the building construction, property maintenance and repair, and alteration and addition works segments for the six months ended September 30, 2024 Alteration, Renovation, Improvement and Interior Decoration Works Segment - Contracts Awarded (Six Months Ended September 30, 2024) | Contract | Commencement Date | Contract Value (thousand HKD) | | :--- | :--- | :--- | | Renovation Works for West Kowloon Campus — Phase 3 Project of The Hong Kong Polytechnic University | September 2024 | 12,579 | | Total | | 12,579 | Alteration, Renovation, Improvement and Interior Decoration Works Segment - Contracts Completed (Six Months Ended September 30, 2024) | Contract | Commencement Date | Completion Date | Contract Value (thousand HKD) | | :--- | :--- | :--- | :--- | | High School Improvement Works at Hong Kong International School | March 2023 | April 2024 | 26,997 | | Space Reorganization Works at City University of Hong Kong | June 2023 | June 2024 | 18,293 | | Optimization Works for the Skill Assessment Centre of Electrical and Mechanical Services Department, Hong Kong | June 2023 | April 2024 | 654 | | Renovation Works for the New Jockey Club "Energy and Materials Physics" Innovation and Technology Laboratory at Yeung Kin Man Academic Building, City University of Hong Kong | March 2024 | August 2024 | 1,994 | | Total | | | 47,938 | - The building construction segment and property maintenance and repair segment had no contracts awarded or completed for the six months ended September 30, 2024[54][82][107] Employees and Remuneration Policy As of September 30, 2024, the group employed 95 staff with total remuneration of approximately HKD 25.1 million, implementing a performance-linked incentive system to attract, retain, and motivate talent, with remuneration packages including basic salary, allowances, benefits, discretionary bonuses, and external training courses Employee and Remuneration Overview | Metric | September 30, 2024 | September 30, 2023 | | :--- | :--- | :--- | | Total Number of Employees | 95 | 202 | | Total Employee Remuneration | Approx. 25.1 million HKD | Approx. 40.3 million HKD | - The remuneration policy is formulated with reference to prevailing market conditions, establishing a performance-linked incentive system to attract, retain, and motivate talent[110] - Remuneration packages include basic salary, allowances, benefits in kind, fringe benefits (such as medical insurance and MPF contributions), and discretionary bonuses, with external training courses also provided[110] Use of Proceeds from Rights Issue The group's net proceeds from the rights issue amounted to approximately HKD 25.97 million, with approximately 35% (HKD 9.09 million) intended for investment in other business opportunities and the remaining approximately 65% (HKD 16.88 million) for general administrative expenses and working capital; as of September 30, 2024, HKD 5.59 million has been utilized, leaving HKD 20.38 million unutilized Use of Net Proceeds from Rights Issue (As at September 30, 2024) | Intended Use of Net Proceeds | Intended Amount to be Used (million HKD) | Amount Used for the Six Months Ended September 30, 2024 (million HKD) | Unused as at September 30, 2024 (million HKD) | | :--- | :--- | :--- | :--- | | Investment in Other Business Opportunities | 9.09 | 0.09 | 9.00 | | General Administrative Expenses and Other General Working Capital | 16.88 | 5.50 | 11.38 | | Total | 25.97 | 5.59 | 20.38 | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income This section presents the condensed consolidated statement of profit or loss and other comprehensive income, detailing revenue, profit, and total comprehensive income for the period Profit or Loss and Comprehensive Income Overview The group's condensed consolidated statement of profit or loss and other comprehensive income for the six months ended September 30, 2024, shows a decrease in revenue compared to the prior year but a significant increase in gross profit, successfully reversing a loss to achieve a profit for the period of HKD 2.168 million and total comprehensive income of HKD 5.666 million Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Six Months Ended September 30) | Metric | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Revenue | 1,439,486 | 1,518,615 | | Cost of Sales and Services | (1,410,369) | (1,500,733) | | Gross Profit | 29,117 | 17,882 | | Operating Profit | 18,495 | 178 | | Profit/(Loss) Before Tax | 4,619 | (12,045) | | Income Tax Expense | (2,451) | (71) | | Profit/(Loss) for the Period | 2,168 | (12,116) | | Total Comprehensive Income for the Period | 5,666 | (20,006) | | Profit/(Loss) Attributable to Owners of the Company | 2,182 | (12,115) | | Basic Earnings/(Loss) Per Share (HK cents) | 0.41 | (3.25) | Condensed Consolidated Statement of Financial Position This section presents the condensed consolidated statement of financial position, outlining the group's assets, liabilities, and equity at the end of the reporting period Financial Position Overview As of September 30, 2024, the group's condensed consolidated statement of financial position shows total assets less current liabilities of HKD 343.662 million and net assets of HKD 135.912 million, with a significant increase in net current assets reflecting improved liquidity Condensed Consolidated Statement of Financial Position (As at September 30, 2024) | Metric | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Non-current Assets | 6,989 | 8,047 | | Current Assets | 748,395 | 671,813 | | Current Liabilities | 411,722 | 469,726 | | Net Current Assets | 336,673 | 202,087 | | Total Assets Less Current Liabilities | 343,662 | 210,134 | | Non-current Liabilities | 207,750 | 105,898 | | Net Assets | 135,912 | 104,236 | | Total Equity | 135,912 | 104,236 | | Share Capital | 6,129 | 4,500 | | Reserves | 133,818 | 103,795 | Condensed Consolidated Statement of Changes in Equity This section details changes in the group's equity, including contributions from share issuance and total comprehensive income for the period Equity Changes Overview The group's condensed consolidated statement of changes in equity for the six months ended September 30, 2024, shows total equity increasing from HKD 104.236 million as at April 1, 2024, to HKD 135.912 million, primarily driven by share issuance through rights issue and total comprehensive income for the period Condensed Consolidated Statement of Changes in Equity (Six Months Ended September 30, 2024) | Item | Share Capital (thousand HKD) | Share Premium Account (thousand HKD) | Exchange Fluctuation Reserve (thousand HKD) | Accumulated Losses/Retained Earnings (thousand HKD) | Total Attributable to Owners of the Company (thousand HKD) | Non-controlling Interests (thousand HKD) | Total Equity (thousand HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | As at April 1, 2024 (Audited) | 4,500 | - | (3,433) | 78,264 | 108,295 | (4,059) | 104,236 | | Acquisition of a Subsidiary | - | - | - | 38 | 38 | - | 38 | | Issue of Shares through Rights Issue | 1,719 | 24,253 | - | - | 25,972 | - | 25,972 | | Total Comprehensive Income for the Period | - | - | 3,498 | 2,182 | 5,680 | (14) | 5,666 | | As at September 30, 2024 (Unaudited) | 6,219 | 24,253 | 65 | 80,446 | 139,947 | (4,035) | 135,912 | - The share premium account is distributable to shareholders, provided that immediately following the proposed dividend distribution, the company will be able to repay its debts as they fall due in the ordinary course of business[96] Condensed Consolidated Statement of Cash Flows This section presents the condensed consolidated statement of cash flows, summarizing cash generated from operating, investing, and financing activities Cash Flow Overview The group's condensed consolidated statement of cash flows for the six months ended September 30, 2024, shows net cash from operating activities of HKD 21.054 million, net cash from investing activities of HKD 5.039 million, and net cash from financing activities of HKD 7.539 million, with cash and cash equivalents at the end of the period significantly increasing to HKD 118.852 million Condensed Consolidated Statement of Cash Flows (Six Months Ended September 30) | Metric | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Net Cash from Operating Activities | 21,054 | 21,196 | | Net Cash from Investing Activities | 5,039 | 1,829 | | Net Cash from/(Used in) Financing Activities | 7,539 | (7,527) | | Net Increase in Cash and Cash Equivalents | 33,632 | 15,498 | | Cash and Cash Equivalents at End of Period | 118,852 | 81,242 | | Bank and Cash Balances | 20,385 | 12,647 | | Unpledged Time Deposits with Original Maturity of Less Than Three Months at Acquisition | 98,467 | 68,595 | Notes to the Condensed Consolidated Financial Statements This section provides detailed notes to the condensed consolidated financial statements, covering accounting policies, segment information, and financial disclosures 1. General Information This note provides basic information about Green Economic Development Limited, including its place of incorporation, principal place of business, listing status, and primary business activities in supply chain management, building construction, property maintenance, and alteration works services - The company is an exempted company incorporated in the Cayman Islands, with its shares listed on the Main Board of The Stock Exchange of Hong Kong Limited[124] - The group is principally engaged in supply chain management, provision of building construction services, property maintenance and repair services, and alteration, renovation, improvement and interior decoration works services[147] 2. Basis of Preparation These condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the Listing Rules of the Stock Exchange, and should be read in conjunction with the 2024 annual consolidated financial statements, with accounting policies and methods of computation consistent with the annual statements - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[148] - The accounting policies and methods of computation used in the preparation of these condensed consolidated financial statements are consistent with those adopted in the group's annual consolidated financial statements for the year ended March 31, 2024[150] 3. Adoption of New and Revised Hong Kong Financial Reporting Standards The group adopted HKAS 12 (Amendments) "Deferred Tax related to Assets and Liabilities arising from a Single Transaction" and other new and revised Hong Kong Financial Reporting Standards from April 1, 2024, but these adoptions had no significant impact on the condensed consolidated interim financial statements - The group has adopted HKAS 12 (Amendments) "Deferred Tax related to Assets and Liabilities arising from a Single Transaction" from April 1, 2024[151] - The amendments had no significant impact on the condensed consolidated statements of financial position as at April 1, 2023, March 31, 2024, and September 30, 2024[151] - All other new and revised Hong Kong Financial Reporting Standards adopted by the group during the period did not have a significant impact on the condensed consolidated interim financial statements[128] 4. Revenue and Segment Information The group's operating segments include supply chain management, building construction, alteration and addition works, and property maintenance, with the supply chain management segment now consolidating material trading and transportation services; this section details each segment's revenue and performance, as well as revenue disaggregated by geographical market and timing of revenue recognition - The group has four operating segments: supply chain management, building construction and other construction-related businesses, alteration, renovation, improvement and interior decoration works, and property maintenance and repair[131][154] - The material trading and transportation services business has been merged into a new "Supply Chain Management" segment to more accurately reflect business strategy[154] Segment Revenue and Profit/(Loss) (Six Months Ended September 30, 2024) | Segment | Revenue from External Customers (thousand HKD) | Segment Profit/(Loss) (thousand HKD) | | :--- | :--- | :--- | | Supply Chain Management | 1,224,709 | 9,527 | | Building Construction and Other Construction-Related Businesses | 225 | 195 | | Alteration, Renovation, Improvement and Interior Decoration Works | 19,243 | (6,682) | | Property Maintenance and Repair | 195,309 | 25,781 | | Total | 1,439,486 | 28,821 | Revenue from External Customers by Geographical Market and Timing of Revenue Recognition (Six Months Ended September 30, 2024) | Geographical Market/Timing of Recognition | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Major Geographical Markets | | | | Hong Kong | 454,874 | 421,985 | | China (excluding Hong Kong) | 984,612 | 1,096,630 | | Timing of Revenue Recognition | | | | Goods and Services Transferred at a Point in Time | 1,198,620 | 1,119,018 | | Services Transferred Over Time | 240,866 | 399,597 | | Total | 1,439,486 | 1,518,615 | - Contract assets primarily relate to work completed but not yet invoiced, while contract liabilities mainly relate to short-term prepayments for construction services and prepayments for iron ore procurement[136] 5. Other Income and Other Gains and Losses This section details the composition of the group's other income and other gains and losses for the six months ended September 30, 2024, including interest income, bargain purchase gain, and net exchange loss Other Income and Other Gains and Losses (Six Months Ended September 30) | Item | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Other Income | | | | Interest Income from Subcontractors | 1,438 | 1,874 | | Bank Interest Income | 2,996 | 1,859 | | Others | 464 | 80 | | Total Other Income | 4,898 | 3,813 | | Other Gains and Losses | | | | Bargain Purchase Gain | 600 | — | | Gain on Lease Termination | 31 | — | | Loss from Fair Value Changes of Financial Assets Measured at Fair Value Through Profit or Loss | (35) | — | | Net Exchange Loss | (183) | (32) | | Total Other Gains and Losses | 413 | (32) | 6. Finance Costs The group's finance costs for the six months ended September 30, 2024, primarily comprised interest on bank and other borrowings, interest on lease liabilities, and interest expense on a loan from a related party, totaling HKD 13.876 million Finance Costs (Six Months Ended September 30) | Item | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 317 | 114 | | Interest on Lease Liabilities | 59 | 207 | | Interest on Loan from a Related Party | 13,500 | 11,902 | | Total Finance Costs | 13,876 | 12,223 | 7. Income Tax Expense The group's income tax expense primarily arises from current tax in Hong Kong and the People's Republic of China, totaling HKD 2.451 million; no income tax is payable in the Cayman Islands, the Republic of Seychelles, and the British Virgin Islands, with Hong Kong profits tax rates at 8.25% (first HKD 2 million) and 16.5%, and China subsidiary corporate income tax rates at 25%, or effective rates of 2.5% or 5% for qualified small and micro enterprises Income Tax Expense (Six Months Ended September 30) | Item | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Current Tax — Hong Kong | 2,387 | — | | Current Tax — People's Republic of China | 64 | 71 | | Total Income Tax Expense | 2,451 | 71 | - Hong Kong profits tax rates are 8.25% for the first HKD 2 million of assessable profits and 16.5% for profits exceeding that amount[192] - China subsidiary corporate income tax rate is 25%, with an effective rate of 2.5% for assessable profits below RMB 1 million or 5% for assessable profits between RMB 1 million and RMB 3 million for qualified small and micro enterprises[168] 8. Profit/(Loss) for the Period This section lists items deducted from or credited to the calculation of profit for the six months ended September 30, 2024, primarily including depreciation, bank interest income, and net exchange loss Profit/(Loss) for the Period Calculation Items (Six Months Ended September 30) | Item | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Depreciation of Property, Plant and Equipment | 232 | 269 | | Depreciation of Right-of-Use Assets | 1,446 | 1,665 | | Bank Interest Income | (3,034) | (1,859) | | Interest Income from Subcontractors | (1,438) | (1,874) | | Net Exchange Loss | 183 | 32 | 9. Dividends The Board of Directors does not recommend the payment of any dividends for the six months ended September 30, 2024 - The directors do not recommend the payment of any dividends for the six months ended April 1, 2024, to September 30, 2024[170] 10. Earnings/(Loss) Per Share This section provides the calculation of basic and diluted earnings per share for the six months ended September 30, 2024, showing the company's transition from a loss per share in the prior year to a profit Earnings/(Loss) Per Share Calculation (Six Months Ended September 30) | Metric | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Profit/(Loss) for Basic and Diluted Earnings/(Loss) Per Share Calculation | 2,182 | (12,115) | | Weighted Average Number of Ordinary Shares for Basic and Diluted Earnings/(Loss) Per Share Calculation | 529,585,246 | 372,736,316 | | Basic and Diluted Earnings/(Loss) Per Share (HK cents) | 0.41 | (3.25) | - The effect of unexercised share options was not included in the weighted average number of ordinary shares for diluted loss per share calculation as they had an anti-dilutive effect[172] 11. Right-of-Use Assets The group entered into new lease agreements for office and staff quarters during the six months ended September 30, 2023, recognizing lease liabilities and related right-of-use assets of HKD 2.71 million - For the six months ended September 30, 2023, the group entered into new lease agreements for an office and staff quarters for a term of two years, recognizing lease liabilities and related right-of-use assets of HKD 2,710,000[173] 12. Trade and Other Receivables As of September 30, 2024, the group's total trade and other receivables amounted to HKD 330.981 million, with trade receivables at HKD 56.546 million; this section provides an ageing analysis of trade receivables and notes that the group holds no collateral or other credit enhancements for trade receivable balances Trade and Other Receivables (As at September 30, 2024) | Item | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Trade Receivables (net of impairment losses) | 56,546 | 81,724 | | Prepayments | 153,035 | 89,873 | | Deposits and Other Receivables | 121,400 | 65,711 | | Total | 330,981 | 237,308 | Ageing Analysis of Trade Receivables (As at September 30, 2024) | Ageing | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | 0 to 90 days | 55,431 | 70,453 | | 91 to 180 days | 199 | 448 | | 181 to 365 days | 354 | 10,193 | | Over 365 days | 562 | 630 | | Total | 56,546 | 81,724 | - As at September 30, 2024, approximately HKD 92,000 in deposits was pledged to certain insurance companies to obtain performance guarantees[176] 13. Pledged Bank Deposits and Bank and Cash Balances As of September 30, 2024, the group's bank and cash balances totaled HKD 118.852 million, including pledged bank deposits of HKD 64.677 million; RMB-denominated cash and cash equivalents of approximately HKD 251,000 are convertible through authorized banks Pledged Bank Deposits and Bank and Cash Balances (As at September 30, 2024) | Item | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Cash and Bank Balances | 20,385 | 7,840 | | Bank Time Deposits with Original Maturity of Less Than Three Months | 98,467 | 78,848 | | Total | 118,852 | 86,688 | | Pledged Bank Deposits | 64,677 | 63,349 | - The group's RMB-denominated cash and cash equivalents amounted to approximately HKD 251,000; RMB is not freely convertible into other currencies but is convertible through banks authorized to conduct foreign exchange business[178] 14. Trade and Other Payables As of September 30, 2024, the group's total trade and other payables amounted to HKD 313.889 million, with trade payables at HKD 103.807 million; trade payables are interest-free and generally settled within 30 to 60 days Trade and Other Payables (As at September 30, 2024) | Item | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Trade Payables | 103,807 | 78,744 | | Retention Payables | 18,648 | 19,244 | | Accruals and Other Payables (less: non-current portion) | 191,434 | 202,546 | | Total | 313,889 | 300,534 | Ageing Analysis of Trade Payables (As at September 30, 2024) | Ageing | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | 0 to 90 days | 40,646 | 48,224 | | 91 to 180 days | 33,304 | — | | 181 to 365 days | 48 | 15,026 | | Over 365 days | 29,809 | 15,494 | | Total | 103,807 | 78,744 | - Trade payables are interest-free and generally settled within a period of 30 to 60 days[227] 15. Share Capital The group's authorized share capital is HKD 20,000 thousand, and its issued and fully paid share capital as at September 30, 2024, is HKD 6,219 thousand; following the completion of the rights issue, the number of issued shares increased by 171,876,373 shares, with contributions of HKD 1,719 thousand to share capital and HKD 24,253 thousand to share premium Share Capital Overview (As at September 30, 2024) | Item | Number of Shares (thousand shares) | Share Par Value (thousand HKD) | | :--- | :--- | :--- | | Authorised: | | | | Ordinary Shares of HKD 0.01 each | 200,000 | 20,000 | | Issued and Fully Paid: | | | | As at April 1, 2024 | 450,000 | 4,500 | | Shares Issued under Rights Issue | 171,876 | 1,719 | | As at September 30, 2024 | 621,876 | 6,219 | - Following the completion of the rights issue, the number of issued shares of the company increased by 171,876,373 shares, with contributions of HKD 1,719,000 to share capital and HKD 24,253,000 to share premium[206] 16. Share Option Scheme The group has a 2011 scheme and a 2021 scheme in place to attract and retain talent; as of September 30, 2024, a total of 6,664,556 share options granted under the 2011 scheme remained unexercised, representing approximately 1.07% of the issued share capital, with a weighted average exercise price of HKD 0.675 - The company adopted the 2011 Share Option Scheme (terminated) and the 2021 Share Option Scheme, aiming to attract and retain the best personnel, provide additional incentives, and promote business development[184][207][229] - As at September 30, 2024, a total of 6,664,556 share options granted under the 2011 scheme remained unexercised, representing approximately 1.07% of the company's issued share capital[209][236] - The exercise price of share options is determined by the directors, not less than the higher of the closing price on the grant date, the average closing price for the five business days immediately preceding the grant date, and the nominal value of the shares[231] - The weighted average remaining contractual life of unexercised share options at the end of the period was 1.87 years[213] 17. Pledged Assets As of September 30, 2024, the group has pledged other receivables of HKD 92 thousand and bank deposits of HKD 64,677 thousand to banks and insurance companies as collateral for bank financing and performance guarantees Pledged Assets (As at September 30, 2024) | Item | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Other Receivables | 92 | 92 | | Bank Deposits | 64,677 | 63,349 | | Total | 64,769 | 63,441 | 18. Contingent Liabilities The group's contingent liabilities primarily include performance guarantees of HKD 12.341 million and potential compensation to banks or insurance companies due to client dissatisfaction; the Board of Directors considers the likelihood of any outflow from legal claims to be extremely low - Performance guarantees amounting to HKD 12,341,000 (March 31, 2024: HKD 12,979,000) were issued by banks or insurance companies as security for the group's due performance of its obligations under construction contracts[237] - Certain subsidiaries of the company are defendants in various claims, lawsuits, arbitrations, and potential claims related to subcontracting fees, personal injury compensation, and breaches of construction contracts, but the directors consider the likelihood of any outflow from settling legal claims to be extremely remote[215] 19. Acquisition of a Subsidiary The group acquired 100% equity interest in Runpeng Holdings Limited for a cash consideration of HKD 87 thousand, aiming to expand its supply chain management business; this acquisition resulted in a bargain purchase gain of approximately HKD 600 thousand and had a pro forma impact on the group's revenue and profit - The group acquired 100% equity interest in Runpeng Holdings Limited for a cash consideration of HKD 87,000 on September 13, 2024, aiming to expand its supply chain management business[239] - This acquisition resulted in a bargain purchase gain of approximately HKD 600,000, recognized in other gains and losses[216] Fair Value of Net Assets Acquired from Runpeng Holdings Limited (at acquisition date) | Item | thousand HKD | | :--- | :--- | | Property, Plant and Equipment | 103 | | Trade Receivables | 15,352 | | Prepayments, Deposits and Other Receivables | 2,208 | | Financial Assets Measured at Fair Value Through Profit or Loss | 513 | | Amount Due from a Director | 199 | | Bank and Cash Balances | 2,772 | | Inventories | 35 | | Trade and Other Payables | (18,217) | | Contract Liabilities | (2,240) | | Non-controlling Interests' Share | (38) | | Bargain Purchase Gain | (600) | | Cash Consideration | 87 | - If the acquisition had been completed on April 1, 2024, the group's total revenue for the period would have been HKD 289.733 million, and profit for the period would have been HKD 12.576 million[240] 20. Related Party Transactions This section discloses significant transactions and outstanding balances between the group and its related parties, including loans from related parties, amounts due from related parties, amounts due to related parties, and amounts due to a director, along with key management personnel remuneration Interest Expense Paid to a Director of Certain Subsidiaries of the Company (Six Months Ended September 30) | Item | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Interest Expense Paid to Mr. Wong Lo Fai | 13,500 | 11,902 | - Loans from a related party refer to loans provided by Mr. Wong to Magic Choice Holdings Limited and Grand Build Construction Limited, with an annual interest rate of 9.8%, and maturity dates extended to October 31, 2025, and September 30, 2026, respectively[244][269] - Amounts due from a related party refer to compensation amounts paid by the group on behalf of Mr. Wong related to performance guarantees issued by insurance companies for Grand Build Construction (Singapore) Pte. Ltd.'s construction projects[270] Amounts Due to Related Parties (As at September 30, 2024) | Related Party | September 30, 2024 (thousand HKD) | March 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Mega Start Limited | 2,600 | 2,600 | | Mr. Wong | 8,899 | 8,973 | | Total | 11,499 | 11,573 | Key Management Personnel Remuneration (Six Months Ended September 30) | Item | 2024 (thousand HKD) | 2023 (thousand HKD) | | :--- | :--- | :--- | | Short-term Benefits | 8,488 | 7,023 | 21. Approval of Condensed Consolidated Financial Statements These condensed consolidated financial statements were approved and authorized for issue by the Board of Directors on November 29, 2024 - The condensed consolidated financial statements were approved and authorized for issue by the Board of Directors on November 29, 2024[275] Other Information This section provides additional corporate information, including interim dividends, directors' securities dealings, share option schemes, and corporate governance practices Interim Dividend The company's directors do not recommend the payment of any dividend for the six months ended September 30, 2024 - The company's directors do not recommend the payment of any dividend for the six months ended September 30, 2024[276] Standard Code for Securities Transactions by Directors The company has adopted the "Model Code for Securities Transactions by Directors of Listed Issuers" as set out in Appendix 10 to the Listing Rules of the Stock Exchange, and all directors have confirmed compliance with the code for the six months ended September 30, 2024, following specific inquiries - The company has adopted the "Model Code for Securities Transactions by Directors of Listed Issuers" as set out in Appendix 10 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[277] - Following specific inquiries made to all directors, all directors have confirmed that they have complied with the Model Code for the six months ended September 30, 2024[277] Share Option Schemes The company has a 2011 scheme (terminated) and a 2021 scheme, designed to incentivize eligible individuals to achieve excellent results for the company by distributing its equity; unexercised share options under the 2011 scheme remain valid, while no share options under the 2021 scheme were unexercised, granted, exercised, cancelled, or lapsed since its adoption and during the period - The company adopted the 2011 Share Option Scheme on December 19, 2011, and terminated it on September 30, 2021, concurrently adopting the 2021 Scheme[277] - The total number of share options granted but unexercised under the 2011 scheme is 6,664,556 shares, representing approximately 1.07% of the issued shares as at the date of this interim report[278] - The exercise price for share options under the 2011 scheme is HKD 0.6752 per share, with an exercise period from August 13, 2021, to August 12, 2026[257][280] - Since its adoption and during the period, no share options under the 2021 scheme were unexercised, granted, exercised, cancelled, or lapsed[281] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures This section discloses the interests and short positions of directors and the chief executive in the company's shares, underlying shares, and debentures as of September 30, 2024, with Mr. Zhu Feng holding 28.11% and Mr. Zhou Zhe holding 7.54% of the shares Directors' and Chief Executive's Interests in Shares (As at September 30, 2024) | Name of Director | Capacity | Number of Shares/Underlying Shares of the Company | Percentage of the Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Zhu Feng | Beneficial Owner and Interest in Controlled Corporation | 174,797,650 (L) | 28.11% | | Mr. Zhou Zhe | Interest in Controlled Corporation | 46,912,500 (L) | 7.54% | | Mr. Feng Jialun | Beneficial Owner | 3,332,278 (L) | 0.54% | | Mr. Wang Weijun | Beneficial Owner | 468,750 (L) | 0.08% | - Mr. Zhu Feng has a direct interest in 78,520,950 shares and is the ultimate beneficial owner of Ensure Prestige Limited, thus deemed to have an interest in the 96,276,700 shares held by Ensure Prestige Limited, totaling 174,797,650 shares[295] - Mr. Zhou Zhe is the ultimate beneficial owner of Mega Start Limited and is deemed to have an interest in the 46,912,500 shares held by Mega Start Limited[282] Substantial Shareholders' Interests and Short Positions in Shares, Underlying Shares and Debentures This section discloses details of substantial shareholders (other than directors or chief executives of the company) holding 5% or more interest in the company's issued share capital as of September 30, 2024, with Ensure Prestige Limited holding 15.48% and Mega Start Limited holding 7.54% of the shares Substantial Shareholders' Interests in Shares (As at September 30, 2024) | Name of Shareholder | Capacity | Number of Shares Held | Percentage of the Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Ensure Prestige Limited | Beneficial Owner | 96,276,700 (L) | 15.48% | | Mega Start Limited | Beneficial Owner | 46,912,500 (L) | 7.54% | - Mr. Zhu Feng owns the entire issued share capital of Ensure Prestige Limited and is deemed to have an interest in the 96,276,700 shares held by it[298] - Mr. Zhou Zhe owns the entire issued share capital of Mega Start Limited and is deemed to have an interest in the 46,912,500 shares held by it[285] Purchase, Sale or Redemption of the Company's Listed Securities During the period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities - During the period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[299] Corporate Governance Practices The company is committed to establishing good corporate governance practices and complied with all code provisions of the Corporate Governance Code in Appendix 14 to the Listing Rules for the six months ended September 30, 2024, with deviations noted for the unsegregated roles of Chairman and CEO and the absence of two independent non-executive directors at the annual general meeting; the Audit Committee has reviewed the interim results - The company has complied with all code provisions of the Corporate Governance Code and Corporate Governance Report in Appendix 14 to the Listing Rules throughout the six months ended September 30, 2024[287] - The roles of Chairman and Chief Executive Officer were not segregated and were held by the same individual, Mr. Zhou Zhe, during the period from April 1, 2024, to September 30, 2024, which is a deviation from code provision C.2.1[289][300] - Two of the independent non-executive directors were unable to attend the company's annual general meeting held on September 27, 2024, which is a deviation from code provision C.1.6[288] - The Audit Committee comprises three independent non-executive directors, with primary responsibilities including reviewing the group's financial information and risk management, and overseeing the financial reporting system and internal control procedures[9][290][302] Chairman's Appreciation Chairman Mr. Zhou Zhe, on behalf of the Board of Directors, extends heartfelt gratitude to all staff for their dedication and hard work during a challenging period, and also thanks all shareholders for their continuous support and trust - Chairman Mr. Zhou Zhe, on behalf of the Board of Directors, extends heartfelt gratitude to all staff for their dedication and hard work during this challenging period[293] - The Chairman also thanks all shareholders for their continuous support and trust in the company[293]