CONTENTS 目錄 Overview 概覽 | 02 | Corporate Information | 127 | Directors' Report | | --- | --- | --- | --- | | | 公司資料 | | 董事局報告書 | | 04 | Group Profile | 136 | Independent Auditor's Report | | | 集團簡介 | | 獨立核數師報告書 | | 05 | Group Structure | 142 | Consolidated Statement of | | | 集團架構 | | Profit or Loss | | | | | 綜合損益表 | | 08 | Financial and Statistical | | | | | Highlights | 143 | Consolidated Statement of | | | 財務及統計摘要 | | Profit or Loss and Other | | | | | Comprehensive Income | | 14 | Ten-year Financial Summ ...

Contents 目錄 | Corporate Information | 公司資料 | 2 | | --- | --- | --- | | Chairman's Message | 主席訊息 | 4 | | Management Discussion and Analysis | 管理層討論及分析 | 6 | | Corporate Governance Report | 企業管治報告 | 21 | | Environmental, Social and Governance Report | 環境、社會及管治報告 | 40 | | Biographical Details of Directors and Senior Management | 董事及高級管理層履歷詳情 | 62 | | Directors' Report | 董事局報告 | 68 | | Independent Auditor's Report | 獨立核數師報告 | 80 | | Consolidated Statement of Profit or Loss and | 綜合損益及其他全面收益表 | | | Other Compre ...

(Incorporated in the Cayman Islands with limited liability) （於開曼群島註冊成立的有限公司） (Stock code 股份代號 : 3638) ANNUAL REPORT 年報 2025 HUNLICAR GROUP LIMITED 亨利加集團有限公司 ANNUAL REPORT 2025 年報 Hunlicar Group Limited 亨利加集團有限公司 Annual Report 年報 2025 CONTENTS 目 錄 | CORPORATE INFORMATION | 2 | | --- | --- | | 公司資料 | | | FINANCIAL SUMMARY | 6 | | 財務概要 | | | CHAIRMAN'S STATEMENT | 7 | | 主席報告 | | | BIOGRAPHICAL DETAILS OF DIRECTORS AND | | | SENIOR MANAGEMENT | 10 | | 董事及高級管理層的履歷詳情 | | | MANAGEMENT DISCUSSION AND ANALYSIS | 14 ...

[Corporate Information](index=2&type=section&id=Corporate%20Information) This section provides core corporate information including registration details, board and committee members, main offices, legal advisors, auditors, and principal bankers - This section provides core corporate information including the company's basic registration details, list of board and committee members, main offices, legal advisors, auditors, and principal bankers[4](index=4&type=chunk)[7](index=7&type=chunk)[8](index=8&type=chunk) - During and after the reporting period, there were multiple changes in the board and committee members, including resignations, appointments of several directors, and the passing of a non-executive director[6](index=6&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) This section reviews the company's business and financial performance, liquidity, going concern issues, risk management, and future outlook [Business Review](index=5&type=section&id=Business%20Review) The company faced a challenging business environment with low demand in the downstream steel industry and insufficient raw material price reductions, severely squeezing coking industry profit margins - The macro environment was severe: deep adjustments in the real estate sector and declining steel demand led to persistently low demand for coke as a raw material, severely squeezing profit margins in the coking industry[10](index=10&type=chunk)[11](index=11&type=chunk) - The core asset's production was delayed as partner Energy Technology failed to complete supporting facility construction due to market weakness and financing difficulties, preventing the company's advanced coke oven from formal operation; the first financing is now expected in mid-July, with supporting facilities completed by February next year[16](index=16&type=chunk)[18](index=18&type=chunk) - Debt restructuring progress: The company and major creditor China Cinda (Hong Kong) have reached textual consensus on a loan settlement agreement, but the signing date depends on Cinda Hong Kong's adjustment progress at the company's controlling shareholder level[19](index=19&type=chunk)[22](index=22&type=chunk) [Financial Review](index=7&type=section&id=Financial%20Review) Group total revenue significantly increased to approximately HK$34.23 million, primarily from new coke processing trade, while annual loss narrowed to HK$29.49 million due to reduced administrative expenses Consolidated Operating Performance Summary | Indicator | FY2024/25 (HKD) | FY2023/24 (HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | 34,230,000 | 2,403,000 | +1324.5% | | Gross Profit | 45,000 | 3,000 | +1400.0% | | Gross Profit Margin | 0.1% | 0.1% | Flat | | Loss After Tax | (29,487,000) | (35,739,000) | Loss narrowed by 17.5% | | Loss Attributable to Company Owners | (29,484,000) | (35,732,000) | Loss narrowed by 17.5% | | Basic Loss Per Share | (0.10) | (0.12) | Loss narrowed by 16.7% | - Business segment performance diverged: the coke trading segment generated all revenue of approximately **HK$34.23 million**, while coal-related ancillary and coke production segments had no revenue or performance for two consecutive reporting periods due to business interruption and coke oven shutdown[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) - Expenses and costs: Administrative expenses decreased by **34.3%** year-on-year to **HK$17.94 million**, primarily due to reduced exchange losses and professional fees, which was the main reason for the narrowed pre-tax loss; finance costs remained largely flat at approximately **HK$31.14 million**[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) - Capital structure: As of March 31, 2025, the gearing ratio was **47%**, a slight increase from **45%** in the previous year; equity attributable to company owners was approximately **HK$875 million**, with net asset value per share at **HK$3.59**[47](index=47&type=chunk)[48](index=48&type=chunk) [Liquidity and Financial Resources](index=9&type=section&id=Liquidity%20and%20Financial%20Resources) As of March 31, 2025, the Group's liquidity remained tight, with net current liabilities expanding to approximately HK$444.5 million and the current ratio decreasing to 0.24, indicating increased short-term repayment pressure Liquidity Indicators | Indicator | March 31, 2025 (HKD) | March 31, 2024 (HKD) | | :--- | :--- | :--- | | Net Current Liabilities | 444,496,000 | 337,091,000 | | Current Ratio | 0.24 | 0.29 | | Cash and Bank Balances | 1,675,000 | 2,448,000 | | Other Borrowings | 218,188,000 | 218,188,000 | [Going Concern, Auditor's Opinion, and Action Plans](index=10&type=section&id=Going%20Concern%2C%20Auditor%27s%20Opinion%2C%20and%20Action%20Plans) The company faces significant going concern uncertainties, leading to a disclaimer of opinion from the auditor, while management believes financial statements are appropriately prepared on a going concern basis given new asset operations and debt settlement progress - Significant going concern uncertainty exists: Note 2 to the financial statements indicates substantial doubt about the Group's ability to continue as a going concern due to continuous losses, high net current liabilities, and facing a winding-up petition; the validity of the financial statements depends on (i) successful settlement with creditors, (ii) the new operating assets' ability to generate cash flow, (iii) coal prices meeting expectations, and (iv) successful recovery of accounts receivable[53](index=53&type=chunk)[54](index=54&type=chunk) - Auditor issued a disclaimer of opinion: Considering the significant going concern uncertainty and the unclear outcome of management's measures to resolve liquidity issues, the auditor was unable to express an opinion on the financial statements; additionally, the auditor had a scope limitation regarding the recoverability of accounts receivable from Energy Technology[55](index=55&type=chunk)[58](index=58&type=chunk) - Management and Audit Committee's response: Management has formulated an action plan including: (i) advancing settlement negotiations with lenders to withdraw the winding-up petition, (ii) promoting full operation of new operating assets, (iii) continuing to pursue outstanding accounts receivable, and (iv) actively seeking other financing channels; the Audit Committee reviewed and agreed with management's position and action plan[60](index=60&type=chunk)[62](index=62&type=chunk)[76](index=76&type=chunk) [Risk Management and Other Disclosures](index=13&type=section&id=Risk%20Management%20and%20Other%20Disclosures) The company employs a three-tier risk management approach focusing on interest rate and foreign currency risks, with no significant contingent liabilities, operating leases, or capital commitments during the reporting period - Risk management framework: The Group adopts a three-tier risk management approach, with the Board responsible for ensuring the soundness and effectiveness of the system, primarily managing interest rate risk and foreign currency risk[78](index=78&type=chunk)[79](index=79&type=chunk) - Employees and remuneration: During the reporting period, the Group's staff costs were approximately **HK$9.71 million**, a decrease from **HK$10.225 million** in the previous period; as of March 31, 2025, the Group had **15** employees[90](index=90&type=chunk) - No significant commitments or securities transactions: As of the end of the reporting period, the Group had no operating lease commitments or significant contingent liabilities, and did not purchase, sell, or redeem any of the company's listed securities during the period[77](index=77&type=chunk)[88](index=88&type=chunk)[92](index=92&type=chunk) [Prospects](index=15&type=section&id=Prospects) The company will focus on three key areas: promoting coke oven production, investing in deep processing of coking by-products, and exploring new energy investment opportunities in response to national "dual carbon" strategies - Core business production: The primary task is to promote early production of the coke oven to achieve cash flow and profitability[98](index=98&type=chunk) - Industrial chain extension: Plans to invest in fine deep processing of coking by-product tail gas to enhance product added value and profitability[98](index=98&type=chunk) - New sector expansion: Will actively seek investment opportunities in new and green energy sectors in response to the national "dual carbon" strategy[98](index=98&type=chunk) [Biographical Details of Directors and Senior Management](index=15&type=section&id=Biographical%20Details%20of%20Directors%20and%20Senior%20Management) This section provides detailed biographical information for the company's executive, non-executive, and independent non-executive directors, as well as the company secretary [Executive Directors](index=16&type=section&id=Executive%20Directors) The executive director team comprises Chairman and CEO Mr. Zhao Xuguang and Mr. Wang Yijun, both possessing extensive experience in business management, energy, industrial construction, and investment - Mr. Zhao Xuguang, 62, serves as Chairman and Chief Executive Officer, with over **20 years** of experience in business decision-making and management, holding a Bachelor's degree in Economics[99](index=99&type=chunk) - Mr. Wang Yijun, 62, holds qualifications in industrial and civil architecture from Taiyuan University, and has served as general manager in investment and trade sectors[100](index=100&type=chunk) [Non-Executive Directors](index=16&type=section&id=Non-Executive%20Directors) Non-executive directors include Mr. Huang Shaoxiong and Ms. Fang Min, bringing extensive experience in banking, finance, commodity trading, and corporate finance transactions - Mr. Huang Shaoxiong, 69, has over **40 years** of experience in banking, finance, commodity trading, and project development, serving as a director in multiple listed companies[101](index=101&type=chunk)[104](index=104&type=chunk) - Ms. Fang Min, 54, appointed on December 31, 2024, possesses over **28 years** of experience in corporate finance transactions, including M&A and IPOs[105](index=105&type=chunk) [Independent Non-Executive Directors](index=18&type=section&id=Independent%20Non-Executive%20Directors) The independent non-executive director team, appointed on June 16, 2025, comprises Mr. Qiu Boyu, Dr. Zhang Xinbin, and Mr. Cai Weikang, all with deep professional backgrounds in accounting, auditing, corporate governance, taxation, and finance - Mr. Qiu Boyu, 56, is a practicing accountant in Hong Kong with over **30 years** of experience in M&A transaction support and financial due diligence[108](index=108&type=chunk) - Dr. Zhang Xinbin, 60, has over **38 years** of experience in auditing, financial reporting, taxation, and internal control, holding multiple professional qualifications[112](index=112&type=chunk) - Mr. Cai Weikang, 67, is a member of the Hong Kong Institute of Certified Public Accountants, previously worked at PwC, and has served as general manager and director in various enterprises[116](index=116&type=chunk)[117](index=117&type=chunk) [Company Secretary](index=22&type=section&id=Company%20Secretary) The Company Secretary is Ms. Au Wing Sze, appointed since August 1, 2020, holding a Bachelor of Business Administration and a Master of Corporate Governance, with extensive experience in listed companies - Ms. Au Wing Sze holds a Master of Corporate Governance degree and is a member of the Hong Kong Chartered Governance Institute and the Chartered Governance Institute in the UK, possessing extensive professional experience[120](index=120&type=chunk) [Report of the Directors](index=22&type=section&id=Report%20of%20the%20Directors) This report provides an overview of the company's business, financial performance, key risks, future development, and corporate governance matters, including director information and shareholder interests [Business and Financial Overview](index=23&type=section&id=Business%20and%20Financial%20Overview) This section outlines the company's main businesses, key risks, and future development directions, emphasizing the push for new coke oven assets and expansion into clean energy - Principal businesses: The company is an investment holding company primarily engaged in coke trading, coal-related ancillary businesses, and coke production[123](index=123&type=chunk) - Key risks: The company faces three major risks: (1) fluctuations in coke and coal prices; (2) changes in Chinese government policies and regulations, particularly environmental protection and capacity reduction policies; and (3) safety production management risks[125](index=125&type=chunk)[132](index=132&type=chunk)[134](index=134&type=chunk) - Future development: The company plans to promote the full operation of new coke oven assets with an annual capacity of no less than **1.2 million tonnes** of coke, and intends to develop clean energy projects such as liquefied natural gas and hydrogen using coke oven gas[139](index=139&type=chunk)[140](index=140&type=chunk) [Reserves and Dividends](index=28&type=section&id=Reserves%20and%20Dividends) As of March 31, 2025, the company had no distributable reserves, and the Board therefore did not recommend a final dividend for the year - As of March 31, 2025, the company's distributable reserves were a negative **HK$714 million**, thus no reserves were available for distribution[160](index=160&type=chunk) - The Board did not recommend a final dividend for the year ended March 31, 2025, consistent with the previous year[161](index=161&type=chunk) [Directors and Corporate Matters](index=29&type=section&id=Directors%20and%20Corporate%20Matters) This section discloses the list of directors, their re-election at the upcoming AGM, confirmation of independent directors' independence, purchase of liability insurance for directors, and absence of significant connected transactions - Director changes and re-election: Significant changes occurred in the Board after the reporting period, with several directors resigning and new appointments including Ms. Fang Min, Mr. Qiu Boyu, Dr. Zhang Xinbin, and Mr. Cai Weikang; Mr. Wang Yijun and the newly appointed directors will stand for re-election at the 2025 Annual General Meeting[168](index=168&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) - Independence confirmation: The company has received annual independence confirmations from each independent non-executive director and considers them to have remained independent throughout the reporting period and up to the report date[176](index=176&type=chunk) - No significant connected transactions: During the reporting period, neither the company, its subsidiaries, directors, nor controlling shareholders engaged in any significant connected transactions, arrangements, or contracts[189](index=189&type=chunk) [Share Interests](index=32&type=section&id=Share%20Interests) As of March 31, 2025, Chairman Mr. Zhao Xuguang held 50.57% of the company's shares through his controlled corporations, with other significant shareholders also disclosed Shareholdings of Directors and Major Shareholders (as of March 31, 2025) | Shareholder Name/Name | Nature of Interest | Number of Shares Held | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Zhao Xuguang | Interest in controlled corporation | 146,841,904 | 50.57% | | Ms. Fang Min | Beneficial owner | 3,301,886 | 1.137% | | Rongtai Resources Limited (controlled by Mr. Li Hongwei) | Beneficial owner/controlled corporation | 14,718,922 | 5.07% | [Customers, Suppliers and Other Disclosures](index=35&type=section&id=Customers%2C%20Suppliers%20and%20Other%20Disclosures) The company experienced high customer and supplier concentration, with the top five accounting for 100% of total turnover and purchases respectively, and provided updates on the winding-up petition - High customer and supplier concentration: The top five customers accounted for **100%** of total turnover, with the largest customer accounting for **43.7%**; the top five suppliers accounted for **100%** of total purchases, with the largest supplier accounting for **56.9%**[216](index=216&type=chunk) - Post-reporting period events: The hearing for the winding-up petition against the company has been adjourned to August 25, 2025; the company has reached consensus with the petitioner, China Cinda (Hong Kong), on the terms of a settlement agreement, but formal signing awaits the petitioner's completion of preferred share terms adjustment at the company's controlling shareholder level[225](index=225&type=chunk)[226](index=226&type=chunk) [Corporate Governance Report](index=37&type=section&id=Corporate%20Governance%20Report) This report details the company's corporate governance practices, board structure, committee functions, risk management, internal controls, and shareholder communication, highlighting compliance and deviations from the CG Code [Corporate Governance Practices](index=38&type=section&id=Corporate%20Governance%20Practices) The company strives to maintain high corporate governance standards, largely complying with the Listing Rules' Corporate Governance Code, with two noted deviations and an auditor's disclaimer on going concern - The company has complied with most provisions of the Corporate Governance Code, with two deviations noted[241](index=241&type=chunk) - Deviation from Code Provision C.2.1: The roles of Chairman and Chief Executive Officer are combined and held by Mr. Zhao Xuguang; the Board believes this ensures leadership consistency and efficient strategic planning[258](index=258&type=chunk)[263](index=263&type=chunk) - Deviation from Code Provision C.1.6: Non-executive director Mr. Jiang Jiansheng was absent from the Extraordinary General Meeting on September 30, 2024, due to personal reasons[309](index=309&type=chunk)[310](index=310&type=chunk)[312](index=312&type=chunk) - The auditor issued a disclaimer of opinion regarding the company's ability to continue as a going concern, and the company has disclosed its response plan in the Management Discussion and Analysis section[242](index=242&type=chunk) [Board of Directors](index=39&type=section&id=Board%20of%20Directors) The Board of Directors, comprising nine members including a majority of independent non-executive directors, is responsible for leading the company, overseeing operations, and ensuring compliance, with regular meetings and continuous professional development for directors - Board composition: The Board comprises **nine** members, with independent non-executive directors constituting one-third, complying with Listing Rules requirements[249](index=249&type=chunk)[265](index=265&type=chunk) - Board meetings: A total of **6** Board meetings were held during the reporting period, with most directors attending all or most meetings[301](index=301&type=chunk)[308](index=308&type=chunk) - Continuous professional development: All directors participated in continuous professional development training covering legal, accounting, corporate governance, and director responsibilities to ensure their contributions remain current[314](index=314&type=chunk)[315](index=315&type=chunk) [Board Committees](index=48&type=section&id=Board%20Committees) The company has established an Audit Committee, Remuneration Committee, and Nomination Committee to assist the Board in overseeing financial reporting, risk management, internal controls, remuneration policies, and board composition - Audit Committee: Composed of three independent non-executive directors and one non-executive director, responsible for reviewing financial statements, evaluating external auditor performance, and reviewing risk management and internal control systems[323](index=323&type=chunk)[324](index=324&type=chunk)[333](index=333&type=chunk) - Remuneration Committee: Composed of three independent non-executive directors and one non-executive director, responsible for reviewing directors' fees and remuneration policies, ensuring no director participates in determining their own remuneration[329](index=329&type=chunk)[330](index=330&type=chunk)[337](index=337&type=chunk) - Nomination Committee: Composed of one executive director (Chairman) and three independent non-executive directors, responsible for reviewing board composition, assessing director independence, and nominating directors for re-election[338](index=338&type=chunk)[339](index=339&type=chunk)[342](index=342&type=chunk) [Risk Management, Internal Control and Auditor](index=52&type=section&id=Risk%20Management%2C%20Internal%20Control%20and%20Auditor) The Board is ultimately responsible for the Group's risk management and internal control systems, which are based on the COSO framework and annually evaluated, with the Audit Committee overseeing auditor independence - Risk management and internal control: The Group's risk management and internal control framework is based on the COSO framework and annually evaluated by independent external professionals; the Board considers the system effective and adequate[344](index=344&type=chunk)[347](index=347&type=chunk)[351](index=351&type=chunk) - Auditor's remuneration: For the year ended March 31, 2025, audit service fees paid to the auditor, Zhonghui Anda CPA Limited, amounted to **HK$950,000**, with no non-audit service fees[358](index=358&type=chunk)[360](index=360&type=chunk) - Directors' responsibility for financial statements: Directors confirm their responsibility for preparing true and fair consolidated financial statements and consider the adoption of the 'going concern' basis appropriate[360](index=360&type=chunk) [Shareholders' Rights and Communication](index=57&type=section&id=Shareholders%27%20Rights%20and%20Communication) The company outlines shareholders' rights under Bermuda company law and its bye-laws, including procedures for convening extraordinary general meetings and proposing resolutions, emphasizing transparent communication through various channels - Convening Extraordinary General Meetings: Shareholders holding not less than **10%** of the paid-up share capital have the right to request the Board to convene an Extraordinary General Meeting[374](index=374&type=chunk) - Proposing resolutions at General Meetings: Shareholders holding not less than **5%** of the paid-up share capital or not less than **100** shareholders may request the company to circulate notice of a resolution intended to be moved at the meeting[380](index=380&type=chunk) - Communication channels: The company maintains communication with shareholders through annual reports, announcements, its company website (www.huscoke.com), and general meetings, and provides a dedicated investor relations email (ir@huscoke.com)[384](index=384&type=chunk)[386](index=386&type=chunk)[390](index=390&type=chunk) [Environmental, Social and Governance Report](index=60&type=section&id=Environmental%2C%20Social%20and%20Governance%20Report) This report covers the Group's ESG governance, strategy, environmental performance, and social responsibility initiatives, including targets for reducing energy, water, and greenhouse gas emission densities [ESG Governance and Strategy](index=61&type=section&id=ESG%20Governance%20and%20Strategy) The ESG report covers the Group's Hong Kong office and Shanxi plant, following HKEX ESG Reporting Guide, with a Board-led governance structure and targets to reduce electricity, water, and GHG emission densities by 5% by 2030 - ESG governance structure: The Group has established a governance structure with the Board ultimately responsible and the ESG Working Group managing and implementing all ESG-related matters[404](index=404&type=chunk)[407](index=407&type=chunk)[414](index=414&type=chunk) - Materiality issues: Through materiality matrix assessment, the Group identified 'emission control,' 'occupational health and safety,' and 'product and service quality' as areas with the greatest impact on business and stakeholders[425](index=425&type=chunk)[427](index=427&type=chunk) 2030 Environmental Targets (2025 as Baseline Year) | Area | Target | | :--- | :--- | | Electricity Consumption | Reduce electricity consumption intensity by 5% by 2030 | | Water Consumption | Reduce water consumption intensity by 5% by 2030 | | Greenhouse Gas Emissions | Reduce greenhouse gas emission intensity by 5% by 2030 | [Environmental Performance](index=69&type=section&id=Environmental%20Performance) The Group adheres to environmental regulations, with total GHG emissions of 9.15 tonnes of CO2e primarily from purchased electricity, and has identified and is mitigating physical and transitional climate risks Greenhouse Gas Emissions (tonnes of CO2e) | Scope | FY2025 | FY2024 | | :--- | :--- | :--- | | Scope 1 (Direct Emissions) | – | – | | Scope 2 (Indirect Emissions) | 7.50 | 7.58* | | Scope 3 (Other Indirect Emissions) | 1.65 | 1.18 | | **Total** | **9.15** | **8.76*** | Resource Consumption | Resource Type | Unit | FY2025 | FY2024 | | :--- | :--- | :--- | :--- | | Total Energy Consumption | MWh | 19.72 | 19.94 | | Total Water Consumption | Cubic Meters | 139.38 | 140.22 | - Climate risk identification: The Group has identified climate-related physical risks (e.g., coastal inundation, extreme heat) and transitional risks (e.g., changes in market demand, increased operating costs) and is developing corresponding mitigation strategies[471](index=471&type=chunk)[476](index=476&type=chunk)[477](index=477&type=chunk) [Social Performance](index=78&type=section&id=Social%20Performance) The Group maintains a safe and healthy work environment, with 15 full-time employees and zero work-related injuries for three consecutive years, emphasizing employee training, supply chain management, product quality, and anti-corruption measures Employee Profile (as of March 31, 2025) | Indicator | FY2025 | FY2024 | | :--- | :--- | :--- | | Total Employees | 15 | 15 | | Employee Turnover Rate | 20% | 20% | - Health and safety: The Group has achieved zero work-related injuries and fatalities for three consecutive years, with no lost workdays due to work-related injuries during the reporting period[507](index=507&type=chunk)[509](index=509&type=chunk) Employee Training Overview | Indicator | FY2025 | FY2024 | | :--- | :--- | :--- | | Percentage of Employees Trained | 120.00% | 93.33% | | Average Training Hours Per Trained Employee | 13.13 hours | 11.80 hours | - Anti-corruption and whistleblowing: The Group adopts a zero-tolerance policy towards corruption and has established anonymous whistleblowing channels; no concluded corruption litigation cases were reported during the period[557](index=557&type=chunk)[559](index=559&type=chunk)[561](index=561&type=chunk) [Independent Auditor's Report](index=104&type=section&id=Independent%20Auditor%27s%20Report) The independent auditor, Zhonghui Anda CPA Limited, issued a disclaimer of opinion on the consolidated financial statements due to significant uncertainties related to going concern and scope limitations [Disclaimer of Opinion](index=105&type=section&id=Disclaimer%20of%20Opinion) The auditor issued a disclaimer of opinion on the Group's consolidated financial statements due to significant going concern uncertainties, including continuous losses, substantial net current liabilities, and a winding-up petition - The auditor explicitly stated a disclaimer of opinion on the Group's consolidated financial statements due to the inability to obtain sufficient audit evidence as a basis for the opinion[584](index=584&type=chunk) - The basis for the disclaimer of opinion is 'material uncertainty related to going concern,' specifically: as of March 31, 2025, the Group recorded a loss attributable to owners of **HK$29.484 million**, net current liabilities of approximately **HK$444 million**, and received a winding-up petition from a major creditor[585](index=585&type=chunk) - The validity of the financial statements on a going concern basis depends on multiple uncertain factors, including whether new operating assets can commence operation on schedule, successful debt recovery, ability to defer repayments, and successful withdrawal of the winding-up petition; the auditor could not assess the likelihood of success of these measures[588](index=588&type=chunk)[589](index=589&type=chunk) [Other Matters (Scope Limitation)](index=107&type=section&id=Other%20Matters%20%28Scope%20Limitation%29) The auditor noted a scope limitation regarding the recoverability of approximately HK$138 million in prepayments, deposits, and other receivables, which would have led to a qualified opinion even without the going concern issue - Audit scope limitation: The auditor was unable to obtain sufficient appropriate audit evidence regarding the recoverability of approximately **HK$138 million** (2025) and **HK$120 million** (2024) in prepayments, deposits, and other receivables[594](index=594&type=chunk) - Legal process uncertainty: Although management has initiated legal action against the debtors and applied for enforcement, the legal proceedings are ongoing as of the report date, with an unknown outcome, thus preventing determination of the recoverability extent[595](index=595&type=chunk) - Impact on revenue recognition: The uncertainty regarding the recoverability of accounts receivable also prevented the auditor from obtaining sufficient evidence to determine whether the economic benefits from approximately **HK$19.55 million** (2025) in compensation income recognized based on this would correspondingly increase[596](index=596&type=chunk) [Consolidated Financial Statements](index=109&type=section&id=Consolidated%20Financial%20Statements) This section presents the Group's consolidated financial statements, including the statement of profit or loss, financial position, cash flows, and detailed notes explaining key figures and accounting policies [Consolidated Statement of Profit or Loss and Comprehensive Income](index=110&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Comprehensive%20Income) For the year ended March 31, 2025, Group revenue significantly increased to HK$34.23 million, but high finance costs and administrative expenses resulted in an annual loss of HK$29.49 million, albeit narrowed from the previous year Consolidated Statement of Profit or Loss Summary (HK$ Thousand) | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | Revenue | 34,230 | 2,403 | | Gross Profit | 45 | 3 | | Compensation Income | 19,554 | 22,416 | | Administrative Expenses | (17,943) | (27,327) | | Finance Costs | (31,144) | (31,105) | | **Loss Before Tax** | **(29,487)** | **(35,739)** | | **Loss for the Year** | **(29,487)** | **(35,739)** | | **Total Comprehensive Expense for the Year** | **(43,873)** | **(104,619)** | [Consolidated Statement of Financial Position](index=112&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of March 31, 2025, total assets were approximately HK$1.81 billion, largely non-current, with total liabilities at HK$770 million, and net current liabilities expanding to HK$444.5 million, indicating increased short-term liquidity pressure Consolidated Statement of Financial Position Summary (HK$ Thousand) | Item | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | **Non-current Assets** | **1,668,142** | **1,688,844** | | Property, Plant and Equipment | 1,666,634 | 1,687,336 | | **Current Assets** | **142,757** | **138,341** | | **Total Assets** | **1,810,899** | **1,827,185** | | **Current Liabilities** | **587,253** | **475,432** | | **Non-current Liabilities** | **182,456** | **266,690** | | **Total Liabilities** | **769,709** | **742,122** | | **Net Assets** | **1,041,190** | **1,085,063** | | **Net Current Liabilities** | **(444,496)** | **(337,091)** | [Consolidated Statement of Cash Flows](index=115&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) During the reporting period, the Group generated HK$0.751 million in net cash inflow from operating activities, a significant decrease from the previous year, resulting in a net decrease of HK$0.771 million in cash and cash equivalents Consolidated Statement of Cash Flows Summary (HK$ Thousand) | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | Net Cash Inflow from Operating Activities | 751 | 4,255 | | Net Cash (Outflow)/Inflow from Investing Activities | (4) | 271 | | Net Cash Used in Financing Activities | (1,518) | (2,999) | | **Net (Decrease)/Increase in Cash and Cash Equivalents** | **(771)** | **1,527** | | Cash and Cash Equivalents at Beginning of Year | 2,448 | 601 | | **Cash and Cash Equivalents at End of Year** | **1,675** | **2,448** | [Notes to the Consolidated Financial Statements](index=117&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the financial statements, including significant going concern uncertainties, segment information, details of other borrowings, and post-reporting period events regarding the winding-up petition - Note 2 - Going Concern Basis: Details the significant uncertainties faced by the Group, including continuous losses, net current liabilities of **HK$444 million**, receipt of a winding-up petition from a major creditor, and new operating assets not yet generating revenue[636](index=636&type=chunk) - Note 6 - Segment Information: Shows that the **HK$34.23 million** revenue for FY2025 was entirely from the coke trading segment, while coal-related ancillary and coke production segments had no revenue[809](index=809&type=chunk) - Note 23 - Other Borrowings: Discloses total other borrowings of approximately **HK$218 million**, including an unsecured loan of **HK$200 million** that has been demanded for immediate repayment by the lender, leading to a winding-up petition[886](index=886&type=chunk)[888](index=888&type=chunk) [Five-year Financial Summary](index=181&type=section&id=Five-year%20Financial%20Summary) This section provides a five-year overview of the company's key financial data, highlighting significant revenue decline since 2021 and the impact of non-operating gains on net assets Five-year Financial Data Summary (HK$ Thousand) | Item | FY2025 | FY2024 | FY2022/23 | FY2021 | FY2020 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 34,230 | 2,403 | 34,726 | 866,602 | 1,176,982 | | (Loss)/Profit Before Tax | (29,487) | (35,739) | 1,638,678 | (21,513) | (527,533) | | (Loss)/Profit for the Year | (29,487) | (35,739) | 1,248,861 | (31,182) | (532,532) | | Total Assets | 1,810,899 | 1,827,185 | 1,910,086 | 2,221,404 | 2,064,344 | | Total Liabilities | (769,709) | (742,122) | (721,104) | (2,379,496) | 2,189,245 | | Net Assets/(Liabilities) | 1,041,190 | 1,085,063 | 1,188,982 | (158,092) | (124,901) | - Five-year data shows a sharp decline in company revenue since 2021, remaining at extremely low levels in the last two years; the substantial profit in FY2022/23 primarily stemmed from gains on disposal of a subsidiary, not operating profit; net assets turned positive in FY2022/23 due to subsidiary disposal but have slightly declined in the last two years[987](index=987&type=chunk) [Definitions](index=183&type=section&id=Definitions) This section provides clear definitions for specific terms used throughout the report, such as "Board," "Group," and "Listing Rules" - This section provides clear definitions for specific terms used in the report, such as 'Board,' 'the Group,' and 'Listing Rules'[990](index=990&type=chunk)[991](index=991&type=chunk)

Company Information [Board Members and Committees](index=3&type=section&id=Board%20Members%20and%20Committees) The company's board comprises executive and independent non-executive directors, with audit, remuneration, and nomination committees; several directors and committee members changed during the reporting period. - Executive Director changes: Mr. Zhong Guowei, Mr. Liang Jiawei, and Mr. Ma Jian resigned, while Mr. Yang Lun was appointed[4](index=4&type=chunk) - Independent Non-Executive Director changes: Mr. Zeng Haoxian, Ms. Zhang Lingling, Mr. Zhao Chuan, and Mr. Zhou Runzhang resigned, while Ms. Chen Jie and Ms. Gao Yuanyuan were appointed[4](index=4&type=chunk) - Ms. Chen Jie chairs the Audit Committee, Ms. Gao Yuanyuan chairs the Remuneration Committee, and Ms. Wang Meihui chairs the Nomination Committee[4](index=4&type=chunk)[5](index=5&type=chunk) [Company Contact Information](index=3&type=section&id=Company%20Contact%20Information) The company's registered office is in the Cayman Islands, with its headquarters and principal place of business in Hong Kong; its website is http://www.sterlingapparel.com.hk, and its auditor is BDO Limited. - Registered Office: 3rd Floor, Century Yard, Cricket Square, P.O. Box 902, Grand Cayman KY1-1103, Cayman Islands[6](index=6&type=chunk) - Headquarters and Principal Place of Business in Hong Kong: 18-19/F, Vanta Industrial Centre, 9 Tai Yau Street, San Po Kong, Kowloon, Hong Kong[6](index=6&type=chunk) - Company Website: http://www.sterlingapparel.com.hk[7](index=7&type=chunk) - Auditor: BDO Limited[7](index=7&type=chunk) Financial Highlights [Overview of Operating Results](index=5&type=section&id=Overview%20of%20Operating%20Results) For the year ended March 31, 2025, revenue decreased by 16.4% to HKD 477,728 thousand, with improved gross profit margin, resulting in an operating loss and a narrowed net loss. Operating Results (HKD '000) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 477,728 | 571,391 | | Gross Profit | 87,531 | 91,377 | | Gross Profit Margin | 18.3% | 16.1% | | Selling and Distribution Costs | (20,668) | (24,315) | | General and Administrative Expenses | (53,294) | (52,657) | | Operating (Loss)/Profit | (1,309) | 7,442 | | Net Expected Credit Loss on Trade and Other Receivables | (4,834) | (25,802) | | Net Loss for the Year | (6,143) | (18,360) | | EBITDA excluding Expected Credit Loss | 22,330 | 5,034 | | EBITDA before Expected Credit Loss | 27,164 | 30,826 | - Revenue decreased by **16.4%** year-on-year, from **HKD 571,391 thousand** in 2024 to **HKD 477,728 thousand** in 2025[8](index=8&type=chunk) - Gross profit margin increased from **16.1%** in 2024 to **18.3%** in 2025[8](index=8&type=chunk) - Operating results shifted from a **profit of HKD 7,442 thousand** in 2024 to a **loss of HKD 1,309 thousand** in 2025[8](index=8&type=chunk) - Net loss for the year narrowed from **HKD 18,360 thousand** in 2024 to **HKD 6,143 thousand** in 2025[8](index=8&type=chunk) [Financial Position and Key Ratios](index=5&type=section&id=Financial%20Position%20and%20Key%20Ratios) As of March 31, 2025, cash and bank balances significantly decreased, total assets declined, but the debt-to-asset and debt-to-equity ratios improved, while current and quick ratios fell, indicating short-term solvency challenges. Financial Position (HKD '000) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Cash and Bank Balances | 14,710 | 26,965 | | Total Assets | 250,253 | 321,480 | | Net Assets Attributable to Owners | 30,505 | 27,329 | Key Ratios | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Loss Margin | (1.3%) | (3.2%) | | Loss Per Share (HK cents) | (2.17) | (7.65) | | Return on Total Assets | (2.5%) | (5.7%) | | Return on Average Total Equity | (21.2%) | (49.4%) | | Interest Coverage Ratio | -0.7 times | 0.6 times | | Current Ratio | 0.46 | 0.78 | | Quick Ratio | 0.36 | 0.69 | | Debt-to-Asset Ratio | 345.2% | 689.9% | | Debt-to-Equity Ratio | 297.0% | 591.3% | - Cash and bank balances decreased from **HKD 26,965 thousand** in 2024 to **HKD 14,710 thousand** in 2025[8](index=8&type=chunk) - Debt-to-asset ratio significantly decreased from **689.9%** in 2024 to **345.2%** in 2025, and the debt-to-equity ratio also fell from **591.3%** to **297.0%**[8](index=8&type=chunk) Chairman's Statement [Annual Results and Challenges](index=6&type=section&id=Annual%20Results%20and%20Challenges) For the year ended March 31, 2025, sales revenue decreased by 16.4% due to tighter credit policies for smaller clients and reduced sales to the largest client, leading to an operating loss despite improved gross margin, while net loss narrowed significantly due to reduced expected credit loss provisions. - Sales revenue was approximately **HKD 477,728,000**, a **16.4% decrease** from the previous year[10](index=10&type=chunk) - Sales decreased by approximately **HKD 93,663,000**, with **72.0%** attributed to smaller clients due to tighter credit policies and changes in purchasing strategies, and the remaining decrease from the largest client, representing **88%** of its revenue[10](index=10&type=chunk) - An operating loss of approximately **HKD 1,309,000** was recorded, compared to an operating profit of approximately **HKD 7,442,000** in the prior year, primarily due to reduced sales revenue, partially offset by an increase in gross profit margin from **16.1%** to **18.3%**[12](index=12&type=chunk) - Net loss of approximately **HKD 6,143,000** narrowed from approximately **HKD 18,360,000** in the prior year, mainly due to a significant reduction in expected credit loss provisions following the early repayment of **HKD 27,300,000** in advances from San Tai[12](index=12&type=chunk) [Market Environment and Future Outlook](index=6&type=section&id=Market%20Environment%20and%20Future%20Outlook) The new US government's tariff policies and the trend of manufacturing reshoring severely impact the company's exports to the US, increasing market uncertainty and suppressing consumer confidence, leading to anticipated significant sales decline next year. - The new US government's tariff policies and the trend of manufacturing reshoring severely impact exports to the US, affecting inflation, GDP growth, employment, personal income, and discretionary purchasing preferences[11](index=11&type=chunk) - The company anticipates a **significant decline in sales** next year and will monitor sales recovery after tariff issues are resolved[11](index=11&type=chunk) - Despite current cost-cutting measures, the company will continue to seek other cost reduction opportunities in the coming year[12](index=12&type=chunk) Management Discussion and Analysis [Company Background](index=7&type=section&id=Company%20Background) Sterling Apparel Group Holdings Limited is a Hong Kong-based apparel manufacturer offering one-stop solutions, primarily serving US international brands with production facilities in China and Sri Lanka, and listed on the HKEX since October 2018. - Sterling Apparel Group Holdings Limited is a Hong Kong-based apparel manufacturer providing one-stop apparel manufacturing solutions[14](index=14&type=chunk) - Key clients are US-based international apparel brands, with a long-standing relationship with the largest client since the 1990s[14](index=14&type=chunk) - The company operates three production facilities (one in China, two in Sri Lanka) and outsources some production to the Philippines[14](index=14&type=chunk) - The company's shares have been listed on the Main Board of the Hong Kong Stock Exchange since **October 19, 2018**[14](index=14&type=chunk) [Business Review](index=7&type=section&id=Business%20Review) For the year ended March 31, 2025, group revenue decreased by 16.4% due to lower sales to the largest client and deteriorating credit conditions for new clients; gross margin improved, but gross profit still declined, while selling and distribution expenses decreased, and finance costs significantly increased. - Revenue was approximately **HKD 477,728,000**, a **16.4% decrease** compared to the same period last year[15](index=15&type=chunk) - The decrease in sales revenue was primarily due to a **HKD 26,191,000 (5.9%) reduction** in sales to the largest client and a **HKD 67,471,000 reduction** in sales to new clients, mainly related to deteriorating credit conditions and lost sales[15](index=15&type=chunk) - Gross profit margin improved from **16.1%** to **18.3%**, but gross profit still decreased by approximately **HKD 4,450,000**[15](index=15&type=chunk) - Selling and distribution expenses decreased by **15.0%** to approximately **HKD 20,668,000**, primarily achieved through human resource cost savings[15](index=15&type=chunk)[24](index=24&type=chunk) - Finance costs significantly increased by **31.4%** to approximately **HKD 21,323,000**, mainly due to rising interest rates and guarantee fees for bank borrowing arrangements[16](index=16&type=chunk)[26](index=26&type=chunk) - Expected credit loss provisions decreased to approximately **HKD 4,834,000** (compared to HKD 25,802,000 in the prior year), primarily due to early repayment of approximately **HKD 27,300,000** from San Tai[16](index=16&type=chunk) - A loss of approximately **HKD 6,143,000** was recorded, narrowing from a loss of approximately **HKD 18,360,000** in the prior year[17](index=17&type=chunk) [Revenue Analysis](index=8&type=section&id=Revenue%20Analysis) Group revenue primarily derives from outerwear, bottoms, tops, and other apparel products, with outerwear and bottoms being key contributors; most product categories experienced sales declines due to reduced orders from major US clients, with the US market remaining dominant at 99.6% of total revenue. - Apparel products are categorized into outerwear, bottoms, tops, and others, primarily made from wool, cotton, and polyester[18](index=18&type=chunk) Revenue Contribution by Product Category (HKD '000) | Product Category | 2025 Revenue | 2025 Quantity (Thousand Pieces) | 2025 Unit Price (HKD) | 2024 Revenue | 2024 Quantity (Thousand Pieces) | 2024 Unit Price (HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Outerwear | 219,198 | 616 | 355.8 | 243,226 | 708 | 343.5 | | Bottoms | 208,488 | 1,384 | 150.6 | 208,864 | 1,411 | 148.0 | | Tops | 17,050 | 165 | 103.3 | 29,153 | 193 | 151.1 | | Others | 32,337 | 133 | 243.1 | 89,493 | 474 | 188.8 | | **Total** | **477,073** | **2,298** | | **570,736** | **2,786** | | - Revenue decreased across most product categories, primarily due to reduced sales orders from major US clients[19](index=19&type=chunk) Revenue Contribution by Geography (HKD '000) | Location | 2025 Revenue | 2025 Share | 2024 Revenue | 2024 Share | | :--- | :--- | :--- | :--- | :--- | | United States | 475,971 | 99.6% | 567,791 | 99.4% | | Hong Kong | 302 | 0.1% | 519 | 0.1% | | Others | 1,455 | 0.3% | 3,081 | 0.5% | | **Total** | **477,728** | **100.0%** | **571,391** | **100.0%** | [Gross Profit and Other Income/Expenses](index=9&type=section&id=Gross%20Profit%20and%20Other%20Income%2FExpenses) Gross profit margin improved to 18.3% due to manufacturing efficiency and optimized supplier procurement, while other income decreased due to lower sample and claims revenue, partially offset by new loan interest income, and net other gains and losses significantly declined due to exchange losses. - Gross profit margin was approximately **18.3%** (2024: **16.1%**), an increase primarily due to improved manufacturing efficiency and diversified product sourcing from various suppliers[21](index=21&type=chunk) Other Income (HKD '000) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Sample Income | 2,474 | 4,219 | | Claims Income | 96 | 1,340 | | Interest Income from Loans and Other Receivables | 2,707 | – | | **Total** | **6,479** | **7,757** | - Net other gains were approximately **HKD 50,000** (2024: **HKD 1,608,000**), with the decrease primarily attributable to net exchange losses[23](index=23&type=chunk) [Financial Position and Dividend Policy](index=10&type=section&id=Financial%20Position%20and%20Dividend%20Policy) As of March 31, 2025, the group's cash and bank balances decreased mainly due to bank loan repayments, inventory declined by 27.5%, and no final dividend is recommended; the group faces going concern uncertainty due to current liabilities exceeding current assets and financial covenant breaches, but management is addressing liquidity issues. - Cash and bank balances were approximately **HKD 14,710,000** (2024: **HKD 36,949,000**), a decrease primarily due to bank loan repayments, with bank borrowings reducing from **HKD 188,550,000** to **HKD 105,305,000**[28](index=28&type=chunk) - Inventory decreased by **27.5%** to approximately **HKD 20,502,000**[28](index=28&type=chunk) - No final dividend is recommended for the year ended March 31, 2025[29](index=29&type=chunk) - As of March 31, 2025, the group's current liabilities exceeded current assets by **HKD 112,143,000**, and it breached financial covenants on bank borrowings of **HKD 67,517,000**, indicating significant uncertainty regarding its ability to continue as a going concern[192](index=192&type=chunk)[222](index=222&type=chunk) - The company is negotiating with banks for waivers of financial covenants and believes such waivers are likely to be granted[222](index=222&type=chunk) [Prospects and New Business Development](index=11&type=section&id=Prospects%20and%20New%20Business%20Development) The group maintains a cautious outlook for the coming year due to new US tariff policies and economic uncertainty, expecting reduced client purchasing volumes, and has initiated digital marketing services through its Chinese subsidiary to diversify revenue streams. - The new US government's "reciprocal tariffs" policy and economic uncertainty have suppressed consumer confidence, potentially leading US retailers to reduce inventory purchases[30](index=30&type=chunk) - As of early June 2025, client orders on hand decreased by approximately **30%** compared to last year, reflecting reduced purchasing volumes or delayed client purchases[31](index=31&type=chunk) - The group has commenced digital marketing services through its Chinese subsidiary, including performance advertising, display advertising, and short video exposure services, to diversify revenue streams[31](index=31&type=chunk) - The group will continue to adjust expenses and explore new business opportunities[31](index=31&type=chunk) [Liquidity, Capital Resources, and Capital Structure](index=12&type=section&id=Liquidity%2C%20Capital%20Resources%2C%20and%20Capital%20Structure) As of March 31, 2025, the group had HKD 14,710 thousand in cash and bank balances, HKD 96,198 thousand in current assets, and HKD 208,341 thousand in current liabilities; bank borrowings decreased to HKD 105,305 thousand, and the debt-to-asset ratio significantly improved to 345.2%, with funds raised from new share placements used for general working capital. - Cash and bank balances were approximately **HKD 14,710,000** (2024: **HKD 26,965,000**)[32](index=32&type=chunk) - Current assets were approximately **HKD 96,198,000**, and current liabilities were approximately **HKD 208,341,000**[32](index=32&type=chunk) - Bank borrowings were approximately **HKD 105,305,000** (2024: **HKD 188,550,000**), primarily bearing interest at annual rates ranging from **5.48% to 5.74%**[32](index=32&type=chunk) - The debt-to-asset ratio was approximately **345.2%** (2024: **689.9%**), with the decrease directly resulting from reduced bank borrowings[33](index=33&type=chunk) - Two placements of new shares raised net proceeds of approximately **HKD 5.12 million** and **HKD 3.95 million**, respectively, for general working capital[34](index=34&type=chunk)[36](index=36&type=chunk) [Employees and Remuneration Policy](index=13&type=section&id=Employees%20and%20Remuneration%20Policy) As of March 31, 2025, the group employed 1,281 full-time staff globally, with remuneration based on market conditions, qualifications, experience, position, and seniority, reviewed for performance-based increments, bonuses, and promotions, and no significant labor disputes occurred during the reporting period. - As of March 31, 2025, the group employed approximately **1,281 full-time employees** in Hong Kong, mainland China, and Sri Lanka (2024: **1,290 employees**)[37](index=37&type=chunk) - Remuneration is determined based on market conditions, employee qualifications, experience, position, and seniority, with salary increments, bonuses, and promotions reviewed based on performance[37](index=37&type=chunk) - No serious strikes, significant labor disputes, or difficulties in recruiting skilled employees occurred during the reporting period[37](index=37&type=chunk) [Financial Policies and Foreign Currency Risk](index=13&type=section&id=Financial%20Policies%20and%20Foreign%20Currency%20Risk) The group's operations in Hong Kong, mainland China, the Philippines, and Sri Lanka expose it to foreign currency risks from USD, EUR, RMB, and LKR; currently, there is no foreign currency hedging policy, but a conservative approach is maintained, with continuous monitoring of exchange rate trends for future hedging needs. - The group's business activities and operations are primarily conducted in Hong Kong, mainland China, the Philippines, and Sri Lanka[38](index=38&type=chunk) - The group is exposed to foreign currency risks from **USD, EUR, RMB, and LKR**[38](index=38&type=chunk) - There is currently no foreign currency hedging policy, but a conservative approach is adopted, with exchange rate trends monitored periodically[38](index=38&type=chunk) [Capital Commitments and Contingent Liabilities](index=14&type=section&id=Capital%20Commitments%20and%20Contingent%20Liabilities) As of March 31, 2025, the group had no significant capital commitments and provided corporate guarantees as partial collateral for general banking facilities granted to certain wholly-owned subsidiaries. - As of March 31, 2025, the group had no significant capital commitments[39](index=39&type=chunk) - The group executed corporate guarantees as partial collateral for general banking facilities granted to certain wholly-owned subsidiaries[40](index=40&type=chunk) [Significant Acquisitions and Disposals and Future Plans for Major Investments](index=14&type=section&id=Significant%20Acquisitions%20and%20Disposals%20and%20Future%20Plans%20for%20Major%20Investments) During the reporting period, the group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures, nor did it have any major investment or acquisition plans for capital assets or other businesses as of the reporting date. - No significant acquisitions or disposals of subsidiaries, associates, or joint ventures occurred during the reporting period[41](index=41&type=chunk) - As of the reporting date, there were no specific plans for major investments or acquisitions of capital assets or other businesses[41](index=41&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=14&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) For the year ended March 31, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities. - For the year ended March 31, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities[42](index=42&type=chunk) [Pledge of Assets](index=14&type=section&id=Pledge%20of%20Assets) As of March 31, 2025, the group had no bank deposits pledged for banking facilities, compared to approximately HKD 10.0 million in the prior year. - As of March 31, 2025, the group had no bank deposits pledged for banking facilities (2024: approximately **HKD 10.0 million**)[43](index=43&type=chunk) Directors and Senior Management [Executive Directors](index=15&type=section&id=Executive%20Directors) Executive directors include Ms. Wang Meihui, Chairman and CEO, with over thirty years of apparel industry experience, Mr. Xiao Yiming, responsible for manufacturing facilities and brand development, and Mr. Yang Lun, appointed in May 2025, with extensive sales management experience. - Ms. Wang Meihui (aged **69**) has served as the company's Chairman since **March 23, 2022**, responsible for corporate strategy, business development, product development, key client relationships, and overall corporate performance[44](index=44&type=chunk) - Mr. Xiao Yiming (aged **39**) is responsible for managing manufacturing facilities in Sri Lanka and China, and led the development of the JP by J. Peterman brand in **June 2021**[45](index=45&type=chunk) - Mr. Yang Lun (aged **42**) was appointed as an Executive Director on **May 27, 2025**, bringing extensive experience in sales management[47](index=47&type=chunk) [Independent Non-Executive Directors](index=16&type=section&id=Independent%20Non-Executive%20Directors) Ms. Chen Jie and Ms. Gao Yuanyuan were appointed as independent non-executive directors on May 27, 2025; Ms. Chen is a Fellow of the Association of Chartered Certified Accountants, and Ms. Gao holds a PRC lawyer's certificate with legal experience. - Ms. Chen Jie (aged **40**) was appointed on **May 27, 2025**, is a Fellow of the Association of Chartered Certified Accountants, and has experience in accounting[48](index=48&type=chunk) - Ms. Gao Yuanyuan (aged **34**) was appointed on **May 27, 2025**, holds a People's Republic of China lawyer's certificate, and has experience in legal matters[49](index=49&type=chunk) [Senior Management and Company Secretary](index=16&type=section&id=Senior%20Management%20and%20Company%20Secretary) Mr. Liu Guanghui serves as Senior Purchasing Director with over 27 years of experience, and Mr. Zhou Runzhang is the Company Secretary, possessing over 20 years of experience in accounting, corporate finance, and compliance. - Mr. Liu Guanghui (aged **50**) was promoted to Senior Purchasing Director on **February 1, 2020**, with over **27 years** of experience in purchasing and merchandising[50](index=50&type=chunk) - Mr. Zhou Runzhang is a member of the Hong Kong Institute of Certified Public Accountants, with over **20 years** of experience in accounting, corporate finance, and compliance-related fields[51](index=51&type=chunk) Corporate Governance Report [Corporate Governance Overview](index=17&type=section&id=Corporate%20Governance%20Overview) The Board is committed to developing robust corporate governance and internal control systems to enhance value, accountability, transparency, and shareholder interests, adhering to the HKEX Listing Rules' Corporate Governance Code, except for the combined roles of Chairman and CEO. - The Board is committed to developing and maintaining sound corporate governance and effective internal control systems to enhance corporate value and accountability, formulate business strategies, manage sustainable operations, improve transparency, and protect shareholders' interests[52](index=52&type=chunk) - The company has adopted and complied with all code provisions of the Corporate Governance Code set out in Appendix C1 of the HKEX Listing Rules effective during the period, except for code provision C.2.1 (separation of Chairman and Chief Executive Officer roles), which is deemed reasonable[54](index=54&type=chunk) - The company has adopted the Model Code set out in Appendix C3 of the Listing Rules to regulate directors' dealings in the company's listed securities, and all directors have confirmed compliance[56](index=56&type=chunk) [Board Composition and Operation](index=18&type=section&id=Board%20Composition%20and%20Operation) The Board is responsible for strategy, business development, governance, and risk management, holding at least four regular meetings annually; board composition saw multiple changes, leading to temporary non-compliance with independent non-executive director requirements, which were subsequently rectified, and the combined roles of Chairman and CEO are deemed beneficial for business. - The Board holds at least **four** regular meetings annually, with **nine** Board meetings held during the financial year ended March 31, 2025[58](index=58&type=chunk) - The Board is primarily responsible for strategic direction, business development, corporate governance, risk management, compliance, internal control systems, dividend policy, board diversity policy, shareholder relations, accounting policies, and financial statement matters[61](index=61&type=chunk) - Following Mr. Zeng Haoxian's resignation, the number of independent non-executive directors temporarily fell below the minimum required by Listing Rules 3.10(1) and 3.10A, affecting the composition of the Audit and Remuneration Committees[62](index=62&type=chunk) - After Mr. Zhao Chuan's appointment, the company regained compliance with relevant Listing Rules, but a shortfall in independent non-executive directors reoccurred after Mr. Zhou Runzhang's resignation[63](index=63&type=chunk)[64](index=64&type=chunk) - Ms. Wang Meihui holds both Chairman and Chief Executive Officer roles, which the Board believes benefits the group's business prospects and management[68](index=68&type=chunk) [Board Committees](index=20&type=section&id=Board%20Committees) The Board has established Audit, Remuneration, and Nomination Committees; the Audit Committee oversees financial reporting and risk, the Remuneration Committee sets executive compensation, and the Nomination Committee reviews board structure and identifies candidates, having adopted a diversity policy resulting in 50% gender diversity at both board and employee levels as of March 31, 2025. - The Audit Committee comprises two independent non-executive directors, with Ms. Chen Jie as Chairman, responsible for advising on and overseeing external auditors, financial information, risk management, and internal controls[70](index=70&type=chunk)[71](index=71&type=chunk) - The Remuneration Committee consists of one executive director and two independent non-executive directors, with Ms. Gao Yuanyuan as Chairman, responsible for recommending remuneration policies and structures for directors and senior management, and determining specific remuneration packages[74](index=74&type=chunk)[78](index=78&type=chunk) - The Nomination Committee comprises one executive director and two independent non-executive directors, with Ms. Wang Meihui as Chairman, responsible for reviewing board structure, identifying suitable candidates, assessing independence, and recommending director succession plans[79](index=79&type=chunk)[80](index=80&type=chunk) - The Board has adopted a board diversity policy considering skills, experience, background, gender, age, and other factors; as of March 31,

佳寧娜集團控股有限公司 | 2025年報 Contents 目錄 | Financial Highlights | 財務概要 | 2 | | --- | --- | --- | | Corporate Information | 公司資料 | 3 | | Chairman's Statement | 主席報告 | 5 | | Director and Senior Management's Biographies | 董事及高級管理人員簡歷 | 9 | | Corporate Governance Report | 企業管治報告 | 15 | | Business Review | 業務回顧 | 30 | | Financial Review | 財務回顧 | 46 | | Report of the Directors | 董事會報告書 | 52 | | Independent Auditor's Report | 獨立核數師報告 | 71 | | Consolidated Statement of Profit or Loss | 綜合損益表 | 80 | | Consolidated Statement ...

股份代號 : 129 泛海國際集團有限公司 2025 年報 2 0 2 5 年 報 泛海國際集團有限公司 www.asiastandard.com 目錄 2 公司資料 3 財務摘要 4 主席報告書 5 業務模式及策略 6 管理層討論及分析 12 主要物業 15 五年財務摘要 16 環境、社會及管治報告 29 企業管治報告 39 董事及高級管理層 44 董事會報告書 61 獨立核數師報告 72 綜合損益賬 73 綜合全面收益表 74 綜合資產負債表 76 綜合現金流量表 77 綜合權益變動報表 78 財務報表附註 公司資料 董事 執行董事 馮兆滔先生 （主席） 潘政先生 （董事總經理兼行政總裁） 潘海先生 潘洋先生 倫培根先生 關堡林先生 非執行董事 潘澄女士（於二零二四年 十二月三十一日獲委任） 獨立非執行董事 葉志威先生 梁偉強先生， 太平紳士 馬豪輝先生， 金紫荊星章 ， 太平紳士 （於二零二五年七月二日獲委任） 黃之強先生 審核委員會 黃之強先生 （主席） 葉志威先生 梁偉強先生， 太平紳士 薪酬委員會 黃之強先生 （主席） 馮兆滔先生 潘海先生 葉志威先生 梁偉強先生， 太平紳士 提名委員會 馮兆滔先 ...

香港聯合交易所有限公司（「聯交所」）GEM的特色 GEM的定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他在聯交所上市的公司帶有較高投資風險。有意投 資的人士應了解投資於該等公司的潛在風險，並應經過審慎周詳考慮後方作出投資決定。 由於GEM上市公司普遍為中小型公司，在GEM買賣的證券可能會較於主板買賣之證券承受較大的市場波動風險，同時無法 保證在GEM買賣的證券會有高流通量的市場。 本報告的資料乃遵照聯交所GEM證券上市規則（「GEM上市規則」）而刊載，旨在提供有關Flydoo Technology Holding Limited飛道 旅遊科技有限公司（「本公司」，連同其附屬公司統稱「本集團」）之資料；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。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，且並無遺漏任何事項，足以令致本報告或其所載任何陳述產生誤導。 本報告將自其刊登之日起計最少一連七日登載於聯交所網站www.hkexnews.hk內「最新上市公司公告」一頁及本公司網站 www.flydoo.com.hk內。 本報告 ...

CONTENTS目錄 | CORPORATE INFORMATION | 公司資料 | 2 | | --- | --- | --- | | BUSINESS HIGHLIGHTS | 業務亮點 | 4 | | CORPORATE PROFILE | 公司概況 | 8 | | FINANCIAL SUMMARY | 財務概要 | 10 | | OPERATING SUMMARY | 營運概要 | 13 | | CHAIRMAN'S STATEMENT | 主席報告 | 16 | | MANAGEMENT DISCUSSION AND ANALYSIS | 管理層討論及分析 | 18 | | DIRECTORS' AND SENIOR MANAGEMENT'S | 董事及高級管理人員簡介 | 57 | | BIOGRAPHIES | | | | REPORT OF THE DIRECTORS | 董事會報告 | 66 | | CORPORATE GOVERNANCE REPORT | 企業管治報告 | 90 | | ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT | 環境、 ...

Corporate Information [Company Core Information and Management Changes](index=3&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) The report details the company's corporate information, key advisors, and significant changes in its board of directors and senior management - **Significant changes occurred in senior management** during and after the reporting period[6](index=6&type=chunk)[7](index=7&type=chunk) - Mr Zhou Zhe resigned as Chairman and CEO on February 20, 2025 - Mr Zhu Feng was appointed as Chairman on June 19, 2025 - Mr Tang Hongyang was appointed as CEO on February 20, 2025 - Mr Ngai Ming Tak resigned as President on March 25, 2025 - The board saw the addition of Mr Zhou Dingchen, Mr So Chun Kit and Ms Li Xiaoting, while Dr Huang Liping resigned Chairman's Statement [Financial Performance Summary](index=5&type=section&id=%E8%B2%A1%E5%8B%99%E6%A5%AD%E7%B8%BE%E6%91%98%E8%A6%81) The Group's revenue slightly decreased while operating profit marginally increased, but basic earnings per share fell sharply in fiscal year 2025 Key Financial Indicators for FY2025 | Indicator | FY2025 | FY2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Turnover | Approx HK$2,833 million | Approx HK$2,935 million | -3.5% | | Gross Profit | Approx HK$58.6 million | Approx HK$84.9 million | -31.0% | | Operating Profit | Approx HK$49.6 million | Approx HK$48.2 million | +2.9% | | Basic Earnings Per Share | Approx 2.51 HK cents | Approx 4.89 HK cents | -48.7% | [Business Review and Prospects](index=5&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%89%8D%E6%99%AF) The Group's core operations include supply chain management and construction, with a significant strategic move to dispose of the entire construction business segment - The supply chain management business, focusing on iron ore products, is the Group's core, maintaining inventories at multiple major ports in Mainland China to ensure timely delivery, with iron ore inventory valued at **approximately HK$83.2 million** as of March 31, 2025[13](index=13&type=chunk)[14](index=14&type=chunk) - The construction-related business faces challenges such as market slowdowns, high interest rates, and labor shortages, prompting a focus on cost control and risk mitigation[16](index=16&type=chunk) - On June 19, 2025, the company entered into an agreement to dispose of its construction-related business segment (Prosper Ace Investments Limited and its subsidiaries) for a consideration of **HK$1**, after which the Group will no longer hold any interest in this segment[17](index=17&type=chunk)[21](index=21&type=chunk) Management Discussion and Analysis [Operating Results](index=8&type=section&id=%E7%B6%93%E7%87%9F%E6%A5%AD%E7%B8%BE) The supply chain segment's revenue grew but profit declined, while all construction-related segments experienced significant decreases in both revenue and profit Performance by Business Segment (HK$ million) | Business Segment | FY2025 Revenue | FY2024 Revenue | FY2025 Profit | FY2024 Profit | | :--- | :--- | :--- | :--- | :--- | | Supply Chain Management | 2,453 | 2,201 | 25.1 | 37.6 | | Building Construction | 1.4 | 2 | 0.4 | 1.7 | | Alteration and Addition Works | 44.5 | 116 | 2.9 | 13.5 | | Property Maintenance | 335.1 | 615.8 | 32.7 | 34.0 | - Although the supply chain management segment's revenue increased, its profit **decreased from HK$37.6 million to HK$25.1 million** due to a reduction in profit margin[28](index=28&type=chunk) - The decline in the property maintenance segment's revenue and profit was mainly due to the expiration of two large-scale long-term maintenance contracts in March and December 2024[33](index=33&type=chunk) [Liquidity and Financial Resources](index=9&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 solid financial position with an improved liquidity ratio and increased cash reserves, supported by adequate banking facilities Financial Position Indicators | Indicator | 31 March 2025 | 31 March 2024 | | :--- | :--- | :--- | | Current Assets | HK$662.1 million | HK$671.8 million | | Current Liabilities | HK$418.0 million | HK$469.7 million | | Current Ratio | 1.58 times | 1.43 times | | Cash and Bank Balances | HK$209.9 million | HK$150.0 million | | Gearing Ratio | 31.1% | 30.5% | [Significant Corporate Events and Use of Funds](index=10&type=section&id=%E9%87%8D%E5%A4%A7%E5%85%AC%E5%8F%B8%E4%BA%8B%E4%BB%B6%E5%8F%8A%E8%B3%87%E9%87%91%E7%94%A8%E9%80%94) The company raised funds through a rights issue for investments and working capital and completed an acquisition to expand its iron ore processing services - The company completed a rights issue on April 16, 2024, raising net proceeds of **approximately HK$25.97 million**, of which HK$9.82 million had been used for general administrative expenses and working capital as of March 31, 2025[37](index=37&type=chunk)[38](index=38&type=chunk)[41](index=41&type=chunk) - In September 2024, the company completed the acquisition of Runpeng Holdings Limited to expand its iron ore pre-processing and blending services, strengthening its supply chain management business[43](index=43&type=chunk) [Principal Risks and Uncertainties](index=11&type=section&id=%E4%B8%BB%E8%A6%81%E9%A2%A8%E9%9A%AA%E5%8F%8A%E4%B8%8D%E7%A2%BA%E5%AE%9A%E5%9B%A0%E7%B4%A0) The Group faces distinct risks in its supply chain business, including margin and price volatility, and in its construction business, related to labor and project estimation - The supply chain management business faces risks such as **low gross profit margins**, impairment of receivables, and fluctuations in shipping and market prices[45](index=45&type=chunk) - The construction business is exposed to risks including **rising labor costs**, inaccuracies in project time and cost estimation, and the non-recurrent nature of project revenue[50](index=50&type=chunk) [Contract Progress](index=13&type=section&id=%E5%90%88%E7%B4%84%E9%80%B2%E5%BA%A6) The total value of uncompleted contracts decreased significantly, mainly due to the completion of a major property maintenance contract during the year Change in Value of Uncompleted Contracts (HK$'000) | Business Segment | 31 March 2024 | 31 March 2025 | | :--- | :--- | :--- | | Property Maintenance | 1,229,787 | 273,987 | | Alteration, Renovation, etc | 139,038 | 89,693 | | **Total** | **1,368,825** | **363,680** | - The alteration, renovation, improvement, and interior fitting-out works segment secured **6 new contracts** in FY2025 with a total value of approximately HK$46.55 million[57](index=57&type=chunk) - The property maintenance segment completed a term contract with the Hong Kong Hospital Authority in December 2024, with a contract value of **HK$955.8 million**[59](index=59&type=chunk) [Significant Events After the Reporting Period](index=17&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A0%85) Post-period events include a planned investment, the disposal of the construction business, and the extension of a related loan's maturity date - On June 18, 2025, the company announced its plan to subscribe for investor shares in Peijia Medical Group for up to **HK$11.6 million**[70](index=70&type=chunk) - On June 19, 2025, the company conditionally agreed to sell its target group engaged in building construction, alteration, and property maintenance for **HK$1**[70](index=70&type=chunk) - On June 20, 2025, the maturity date for loans owed by the target group (Magic Choice and Wang Zong) was extended to September 30, 2027, with an annual interest rate of 13%[72](index=72&type=chunk) Biographical Details of Directors and Senior Management [Profiles of Directors and Senior Management](index=19&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E9%AB%98%E7%B4%9A%E7%AE%A1%E7%90%86%E5%B1%A4%E5%B1%A5%E6%AD%B7%E8%A9%B3%E6%83%85) This section details the extensive experience of the board and senior management in finance, steel trading, and the construction industry - The executive director team possesses a strong background in steel trading, banking, risk management, and corporate finance, including Chairman Mr Zhu Feng's long-term executive experience in a steel group and CEO Mr Tang Hongyang's over 20 years in banking[74](index=74&type=chunk)[75](index=75&type=chunk)[78](index=78&type=chunk) - The independent non-executive directors provide expertise in accounting, finance, and public administration, such as Mr Wong Wai Kwan's experience as a veteran accountant and Mr Zhang Shengman's senior roles at the World Bank and Citigroup[80](index=80&type=chunk)[83](index=83&type=chunk) Report of the Directors [Principal Activities and Financial Overview](index=23&type=section&id=%E4%B8%BB%E8%A6%81%E6%A5%AD%E5%8B%99%E5%8F%8A%E8%B2%A1%E5%8B%99%E6%A6%82%E8%A6%BD) The Group's main businesses are supply chain management and construction, with no dividend declared for the year and a high concentration of customers and suppliers - The Board **does not recommend the payment of any dividend** for the year ended March 31, 2025[92](index=92&type=chunk) - The Group has a high concentration of customers and suppliers[100](index=100&type=chunk) - The **top five customers** accounted for approximately **61.9%** of total sales - The **top five suppliers** accounted for approximately **40.6%** of total purchases [Share Option Scheme](index=26&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The company operates a 2021 share option scheme to incentivize talent, while options granted under the terminated 2011 scheme remain partially outstanding Outstanding Share Options under the 2011 Scheme | Grantee Name | Outstanding at Beginning of Year | Changes During Year | Outstanding at End of Year | Lapsed After Reporting Date | Exercise Price | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr Ngai Ming Tak | 3,332,278 | 0 | 3,332,278 | (3,332,278) | HK$0.6752 | | Mr Fung Kar Lun | 3,332,278 | 0 | 3,332,278 | 0 | HK$0.6752 | | **Total** | **6,664,556** | **0** | **6,664,556** | **(3,332,278)** | | - As of March 31, 2025, a total of **37,499,999 shares** were available for issue under the 2021 Scheme, representing approximately 6.03% of the total issued shares, with no options granted since its adoption[111](index=111&type=chunk) [Directors' and Chief Executives' Interests in Shares](index=28&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%8C%81%E8%82%A1) Executive Director Mr Zhu Feng is the company's substantial shareholder, holding a combined interest of 28.11% as of the reporting date Directors' and Substantial Shareholders' Interests (31 March 2025) | Shareholder Name | Capacity | Number of Shares | Shareholding % | | :--- | :--- | :--- | :--- | | Mr Zhu Feng | Beneficial owner & interest of controlled corporation | 174,797,650 | 28.11% | | Ensure Prestige Limited | Beneficial owner | 96,276,700 | 15.48% | | Mega Start Limited | Beneficial owner | 46,912,500 | 7.54% | [Extract of Independent Auditor's Opinion and Board's Response](index=32&type=section&id=%E6%A0%B8%E6%95%B8%E5%B8%AB%E6%84%8F%E8%A6%8B%E6%91%98%E9%8C%84%E5%8F%8A%E8%91%A3%E4%BA%8B%E6%9C%83%E5%9B%9E%E6%87%89) The auditor highlighted a material uncertainty related to going concern due to a significant related party loan, which the board believes is manageable - The auditor noted that as of March 31, 2025, the Group had related party loans of approximately **HK$207 million**, with original maturity dates in October 2025 and September 2026, constituting a material uncertainty regarding the Group's ability to continue as a going concern[139](index=139&type=chunk) - The Board responded that if the disposal of the construction business subsidiaries is completed, the Group will be discharged from this debt; otherwise, the loan's maturity has been extended to September 30, 2027, ensuring sufficient working capital[141](index=141&type=chunk) Corporate Governance Report [Corporate Governance Practices and Deviations](index=34&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F%E5%8F%8A%E5%81%8F%E9%9B%A2%E6%83%85%E6%B3%81) The company complied with most corporate governance code provisions but reported two deviations regarding director attendance and role separation - Deviations from the Corporate Governance Code were noted[145](index=145&type=chunk)[146](index=146&type=chunk) - **Code Provision C.1.6**: Two independent non-executive directors were unable to attend the Annual General Meeting on September 27, 2024 - **Code Provision C.2.1**: Prior to February 20, 2025, the roles of Chairman and CEO were not separate and were both performed by Mr Zhou Zhe [Board and Committee Operations](index=35&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%8F%8A%E5%A7%94%E5%93%A1%E6%9C%83%E9%81%8B%E4%BD%9C) This section outlines the functions of the board and its committees, which held multiple meetings to review financial statements, remuneration, and nominations - The Audit Committee, comprising three independent non-executive directors, held three meetings during the year to review the interim and annual financial statements[163](index=163&type=chunk)[164](index=164&type=chunk) - The Remuneration Committee held four meetings to review director and senior management compensation, with senior management remuneration (excluding directors) ranging from **HK$1 million to HK$2.5 million**[165](index=165&type=chunk)[168](index=168&type=chunk) - The Nomination Committee held four meetings to review the board's structure, assess director independence, and recommend appointments[170](index=170&type=chunk) [Accountability, Risk Management, and Investor Relations](index=41&type=section&id=%E5%95%8F%E8%B2%AC%E3%80%81%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86%E5%8F%8A%E6%8A%95%E8%B3%87%E8%80%85%E9%97%9C%E4%BF%82) The company emphasizes its financial reporting responsibilities, maintains a comprehensive risk management system, and actively communicates with shareholders Auditor's Remuneration (FY2025) | Service Type | Amount (HK$) | | :--- | :--- | | Audit Services Fee | 1,655,000 | | Non-audit Services Fee | 220,000 | | **Total** | **1,875,000** | - The Board is fully responsible for maintaining a sound and effective risk management and internal control system and has engaged an external consultant to conduct an internal control review of specific risk management processes[178](index=178&type=chunk)[179](index=179&type=chunk) Independent Auditor's Report [Auditor's Opinion and Material Uncertainty Related to Going Concern](index=44&type=section&id=%E6%A0%B8%E6%95%B8%E5%B8%AB%E6%84%8F%E8%A6%8B%E8%88%87%E6%8C%81%E7%BA%8C%E7%B6%93%E7%87%9F%E4%B8%8D%E7%A2%BA%E5%AE%9A%E6%80%A7) The auditor issued an unmodified opinion but highlighted a material uncertainty related to the Group's going concern status due to a significant related party loan - The auditor issued an **unmodified opinion**, concluding that the consolidated financial statements give a true and fair view of the Group's financial position[191](index=191&type=chunk) - The report emphasizes a **"Material Uncertainty Related to Going Concern"** arising from related party loans of approximately **HK$207 million** as of March 31, 2025, whose original maturity dates could cast significant doubt on the Group's ability to continue as a going concern[193](index=193&type=chunk)[195](index=195&type=chunk) [Key Audit Matters](index=45&type=section&id=%E9%97%9C%E9%8D%B5%E5%AF%A9%E6%A0%B8%E4%BA%8B%E9%A0%85) The audit focused on revenue recognition for construction contracts and the provision for expected credit losses, both involving significant management judgment - **Key Audit Matter 1: Revenue recognition from construction contracts** was a focus due to the significant management judgment and estimation required to determine the progress of completion and budget costs[197](index=197&type=chunk)[199](index=199&type=chunk) - **Key Audit Matter 2: Provision for expected credit losses (ECL) on trade receivables and contract assets** was identified as critical because management's assessment involves significant judgment, considering historical default rates and forward-looking economic factors[198](index=198&type=chunk)[202](index=202&type=chunk) Consolidated Financial Statements [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=50&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) The Group's profit for the year decreased by 16.2% to HK$15.3 million, impacted by lower gross profit and higher finance costs despite controlled expenses Consolidated Statement of Profit or Loss Summary (HK$'000) | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | Revenue | 2,833,486 | 2,934,565 | | Gross Profit | 58,640 | 84,934 | | Operating Profit | 49,553 | 48,173 | | Profit before Tax | 22,112 | 22,284 | | Profit for the Year | 15,254 | 18,206 | | Profit for the Year Attributable to Owners of the Company | 15,427 | 18,221 | [Consolidated Statement of Financial Position](index=52&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) The Group's net assets grew by 38% to HK$143.8 million, driven by an increase in net current assets and improved liquidity Consolidated Statement of Financial Position Summary (HK$'000) | Item | 31 March 2025 | 31 March 2024 | | :--- | :--- | :--- | | **Assets** | | | | Non-current Assets | 5,506 | 8,047 | | Current Assets | 662,102 | 671,813 | | **Total Assets** | **667,608** | **679,860** | | **Liabilities and Equity** | | | | Current Liabilities | 417,972 | 469,726 | | Non-current Liabilities | 105,824 | 105,898 | | **Total Liabilities** | **523,796** | **575,624** | | **Total Equity** | **143,812** | **104,236** | [Consolidated Statement of Changes in Equity](index=54&type=section&id=%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) Total equity attributable to owners increased to HK$148.0 million, primarily due to the profit for the year and the issuance of shares from a rights issue - Key drivers for the increase in total equity during the year include[221](index=221&type=chunk) - Total comprehensive income for the year: **+HK$13.6 million** - Issuance of shares by way of rights issue: **+HK$26.0 million** [Consolidated Statement of Cash Flows](index=55&type=section&id=%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) The Group generated a net cash inflow from operations of HK$57.9 million, leading to a significant increase in year-end cash and cash equivalents Consolidated Statement of Cash Flows Summary (HK$'000) | Item | FY2025 | FY2024 | | :--- | :--- | :--- | | Cash generated from operations | 57,929 | 51,819 | | Net cash from (used in) investing activities | 6,220 | (2,342) | | Net cash used in financing activities | (5,474) | (28,829) | | **Increase in cash and cash equivalents** | **58,675** | **20,648** | | Cash and cash equivalents at beginning of year | 86,688 | 66,278 | | **Cash and cash equivalents at end of year** | **144,101** | **86,688** | Notes to the Consolidated Financial Statements [Note 2: Basis of Preparation and Going Concern](index=57&type=section&id=%E9%99%84%E8%A8%BB2%EF%BC%9A%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E8%88%87%E6%8C%81%E7%BA%8C%E7%B6%93%E7%87%9F) This note reiterates the material uncertainty related to going concern from the HK$207 million related party loan, which the directors believe is manageable - The note highlights that a material uncertainty exists regarding the Group's ability to continue as a going concern, which depends on[228](index=228&type=chunk)[230](index=230&type=chunk) 1. The successful disposal of the construction business subsidiaries which hold the significant loan 2. The continued extension of the loan's maturity (now extended to September 2027) if the disposal fails 3. The successful drawdown of available banking facilities when needed [Note 8: Revenue](index=85&type=section&id=%E9%99%84%E8%A8%BB8%EF%BC%9A%E6%94%B6%E7%9B%8A) The Group's revenue is dominated by the supply chain management business, with Mainland China being the primary geographical market Revenue by Business Segment (HK$'000) | Business Segment | FY2025 | FY2024 | | :--- | :--- | :--- | | Supply Chain Management | 2,452,473 | 2,200,632 | | Building Construction and Others | 1,360 | 1,963 | | Alteration, Renovation, etc | 44,541 | 116,177 | | Property Maintenance | 335,112 | 615,793 | | **Total** | **2,833,486** | **2,934,565** | Revenue by Geographical Market (HK$'000) | Geographical Market | FY2025 | FY2024 | | :--- | :--- | :--- | | Hong Kong | 646,425 | 892,516 | | China (excluding Hong Kong) | 2,187,061 | 2,042,049 | | **Total** | **2,833,486** | **2,934,565** | [Note 11: Segment Information](index=88&type=section&id=%E9%99%84%E8%A8%BB11%EF%BC%9A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The supply chain segment is the largest contributor to revenue and assets, though its profit declined, and the Group has a high concentration of major customers Revenue from Major Customers (HK$'000) | Customer | Segment | FY2025 Revenue | | :--- | :--- | :--- | | Customer A | Supply Chain Management | 559,296 | | Customer B | Construction and Maintenance | 348,884 | | Customer C | Supply Chain Management | 357,694 | [Notes 32 & 33: Borrowings](index=109&type=section&id=%E9%99%84%E8%A8%BB32%20%26%2033%EF%BC%9A%E5%80%9F%E6%AC%BE) The Group's primary borrowing is a HK$207 million loan from a related party, the maturity of which has been extended to September 2027 - The Group has a loan of approximately **HK$207 million** from a related party, Mr Huang, which is borne by subsidiaries Magic Choice and Wang Zong; the loan's maturity date was extended to September 30, 2027, with an annual interest rate of 13%[385](index=385&type=chunk)[386](index=386&type=chunk) [Note 35: Share Capital](index=110&type=section&id=%E9%99%84%E8%A8%BB35%EF%BC%9A%E8%82%A1%E6%9C%AC) The company's share capital increased following the completion of a rights issue, which also contributed to an improved debt-to-capital ratio - On April 16, 2024, the company completed a rights issue, issuing **171,876,373 new shares** and raising net proceeds of approximately HK$25.97 million[389](index=389&type=chunk) - The Group's debt-to-adjusted capital ratio **decreased from 78% to 66%**, mainly due to a reduction in debt and an increase in equity[391](index=391&type=chunk) [Note 43: Events After the Reporting Period](index=120&type=section&id=%E9%99%84%E8%A8%BB43%EF%BC%9A%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) This note details three major post-period events, including a planned investment, the disposal of the construction business, and a related loan extension - On June 19, 2025, the company signed an agreement to dispose of its target group engaged in construction and maintenance for a consideration of **HK$1**, aiming to divest the business segment and resolve its associated large related party debt[417](index=417&type=chunk)[420](index=420&type=chunk) Five-Year Financial Summary [Five-Year Financial Summary](index=121&type=section&id=%E4%BA%94%E5%B9%B4%E8%B2%A1%E5%8B%99%E6%A6%82%E8%A6%81) This section presents key financial data over the past five years, showing a trend of declining revenue but a recovery in profitability and equity since FY2023 Five-Year Financial Data Summary (HK$'000) | Item | 2021 | 2022 | 2023 | 2024 | 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Results** | | | | | | | Revenue | 5,236,876 | 3,991,555 | 2,462,942 | 2,934,565 | 2,833,486 | | Profit/(Loss) attributable to owners of the parent | 7,216 | (13,566) | (85,348) | 18,221 | 15,427 | | **Assets and Liabilities** | | | | | | | Total Assets | 858,846 | 880,680 | 664,257 | 679,860 | 667,608 | | Total Liabilities | (706,791) | (707,162) | (571,350) | (575,624) | (523,796) | | Total Equity | 152,055 | 173,518 | 92,907 | 104,236 | 143,812 |