Financial Performance - The Group recorded an operating profit before valuation changes in investment properties of HK$191.4 million for the year ended 31 March 2023, compared to HK$182.8 million in 2022, representing an increase of 3.5%[1] - The loss attributable to equity shareholders was HK$759.3 million, up from HK$554.0 million in 2022, indicating a year-over-year increase of 37.1%[1] - Net valuation losses on investment properties amounted to HK$1,707.7 million, compared to HK$1,264.7 million in 2022, reflecting a significant increase of 35.0%[1] - The total dividend for the year is HK$0.13 per share, down from HK$0.16 per share in 2022, marking a decrease of 18.8%[1] Governance and Management - The company has appointed a new Chairman and Chief Executive Officer during the reporting year to ensure compliance with governance codes[29] - The company does not currently have an internal audit function, and the Board reviewed the need for one in March 2023, concluding there was no immediate necessity[31] - The Board believes that the reporting line for the company secretary was appropriate given the circumstances at the time[31] - The Board is responsible for the overall strategies and business plans, as well as overseeing financial and management performance, corporate governance, and risk management[37] - The Company confirmed compliance with the Model Code for Securities Transactions by Directors during the financial year ended March 31, 2023[50] - The Board has established three committees: remuneration, nomination, and audit, to focus on specific areas and ensure effective governance[53] - The Company has mechanisms in place to ensure independent views and input are available to the Board, which were reviewed and considered effectively implemented during the year[43] - The management is responsible for the day-to-day operations and must report to the Board, ensuring close collaboration between the two[42] Risk Management - The Company has established a control environment to enhance risk management and internal control systems across the Group[31] - The Company has taken initiatives to promote the adequacy and effectiveness of risk management and internal control systems[31] - The Company assessed the effectiveness of its risk management and internal control systems, monitoring risk changes throughout the year[132] - The Group conducts a half-yearly risk assessment exercise to identify operational risks and develop mitigating strategies, with a composite risk report submitted to the Board every six months[139] - All department heads are required to maintain a risk register that includes specific risk factors, their impact, and likelihood, which is updated regularly[139] - The Company has implemented key controls and mitigations to manage risks related to economic and political outlook[173] - The management will continue to monitor emerging risks that may significantly affect the Group on a regular basis[175] Board Composition and Diversity - The nomination committee ensures a balanced board composition by considering diversity in attributes, competencies, and professional experience[97] - The Company has adopted a Board diversity policy, aiming to have at least one female Director by December 31, 2024, which has already been accomplished[152] - The Company emphasizes that appointments to the Board are based on merit and contributions rather than focusing solely on gender diversity[152] - The Company does not plan to set any gender diversity quotas or short-term objectives due to the nature of its business and geographical location[152] Audit and Compliance - The audit committee reviewed the half-year and annual financial statements of the Group, ensuring integrity and significant financial reporting judgments before submission to the Board for approval[132] - The audit committee is responsible for reviewing and monitoring the external auditor's independence and effectiveness of the audit process[157] - The Company reviewed its audit policy, risk management policy, and whistleblowing policy, making recommendations to the Board[132] - The Company ensured compliance with legal and regulatory requirements as part of its corporate governance practices[136] Market Conditions - The recovery in Hong Kong is indicated by an increase in inbound visitors and a progressive decrease in unemployment rates[172] - Despite the recovery signs, the pace of retail market recovery remains unclear due to rising interest rates and banking crises[172] - iSQUARE faced slight downward pressure on rental levels and occupancy rates, which showed a minor decrease in the reporting year[172] - The Group's financial performance was negatively impacted by slow global economic growth and rising interest rates, affecting consumer sentiment[173] Investment Properties - The Group's investment properties are stated at fair values, and any material change in their valuation can significantly impact the Group's profit/loss for the year[197] - Rental income is a key driver of property valuation, and there is currently downward pressure on rental levels and occupancy rates, particularly at iSQUARE[197] - The Group aims to build a more diversified tenant mix to maintain a sustainable tenant portfolio[197] - Creative and popular promotions are being launched to increase exposure and stimulate consumer spending, thereby adding value to the investment properties[197] - Maintenance and enhancement works are being carried out to preserve the quality of the investment properties[197]
天德地产(00266) - 2023 - 年度财报