创升控股(02680) - 2024 - 年度财报

Company Information Chairman's Statement Market Review and Company Performance Despite global economic challenges, the Group's total revenue decreased, but it successfully returned to profitability in FY2023/24, driven by strategic capital investments Key Financial Performance in FY2023/24 | Metric | FY2024 | FY2023 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Total Revenue | Approx. 32.7 million HKD | Approx. 45.5 million HKD | -28.1% | | Equity Investment Income | Approx. 22.4 million HKD | N/A | N/A | | Profit/(Loss) and Total Comprehensive Income/(Expense) | Approx. 1.8 million HKD | Approx. (6.6) million HKD | Returned to Profit | - Hong Kong's financial market performed poorly, with the Hang Seng Index falling by approximately 19.9%, average daily stock market turnover decreasing by approximately 20.3%, and total fundraising by new main board listed companies declining by approximately 55.1%[10] - Most of the Group's business revenues declined: corporate finance advisory, securities trading and brokerage, securities financing, and asset management revenues decreased by 32.7%, 4.2%, 62.7%, and 6.2% respectively[13] - Businesses with counter-cyclical growth included placing and underwriting, with revenue increasing by 14.5%, and money lending, with revenue significantly growing by 590.8%[13] Company Overview and Future Outlook The Group, a comprehensive financial and securities service provider, will maintain a cautious approach, strengthen risk management, and explore new business opportunities, particularly in the Greater Bay Area, amidst challenging operating conditions - The Group holds Type 1, 2, 4, 6, and 9 regulated activity licenses issued by the Hong Kong SFC and engages in money lending business[12] - Future strategic priorities include strengthening risk management, strict cost control, expanding product services, exploring new business areas, and seizing opportunities from Greater Bay Area development[14][16] Management Discussion and Analysis Business Overview Despite a 28.1% revenue decline to 32.7 million HKD due to a sluggish market, the Group returned to profitability with a 1.8 million HKD profit, boosted by 22.4 million HKD in equity investment income Revenue Performance by Business Segment (million HKD) | Business Segment | FY2024 Revenue | FY2023 Revenue | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Corporate Finance Advisory | 11.7 | 17.4 | -32.7% | | Securities Trading and Brokerage | 3.0 | 3.1 | -4.2% | | Securities Financing | 5.5 | 14.8 | -62.7% | | Asset Management | 0.4 | 0.5 | -6.2% | | Placing and Underwriting | 10.9 | 9.5 | +14.5% | | Money Lending Services | 1.1 | 0.2 | +590.8% | Corporate Finance Advisory Services Corporate finance advisory revenue decreased by 32.7% to 11.7 million HKD, with a significant reduction in projects handled, including IPO sponsorships, financial advisory, and compliance advisory engagements Corporate Finance Advisory Business Projects and Revenue Details | Project Type | 2024 Projects | 2023 Projects | 2024 Revenue (million HKD) | 2023 Revenue (million HKD) | | :--- | :--- | :--- | :--- | :--- | | IPO Sponsorship | 7 | 12 | 8.2 | 11.1 | | Financial and Independent Financial Advisory | 14 | 21 | 2.0 | 4.4 | | Compliance Advisory | 7 | 11 | 1.5 | 1.9 | | Total | 28 | 44 | 11.7 | 17.4 | Other Financial Services Placing and underwriting revenue increased significantly, while securities trading and brokerage remained stable; securities financing revenue decreased due to a cautious strategy, and money lending saw substantial growth - Placing and underwriting business completed projects increased from 5 to 12, with revenue reaching 10.9 million HKD[28] - Due to a cautious strategy amid market deterioration, outstanding margin loan balances in securities financing significantly decreased from 64.7 million HKD to 18.6 million HKD[31] Money Lending Business Details | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Number of Personal Loans | 9 | 6 | | Outstanding Principal Amount | 19.478 million HKD | 15.511 million HKD | | Annual Interest Rate Range | 3%–15% | 3%–15% | Financial Review Total revenue for the fiscal year was 32.7 million HKD, a 28.1% decrease year-on-year, but the Group returned to profitability with a 1.8 million HKD profit, primarily due to 22.4 million HKD in equity investment income Financial Performance Summary (million HKD) | Item | FY2024 | FY2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | 32.7 | 45.5 | -28.1% | | Equity Investment Income | 22.4 | N/A | N/A | | Other Operating Expenses | 15.1 | 12.6 | +19.0% | | Staff Costs | 41.4 | 41.4 | 0% | | Profit/(Loss) | 1.8 | (6.6) | Returned to Profit | Liquidity, Financial Resources and Capital Structure The Group maintains a robust financial position with sufficient liquidity, evidenced by net current assets of 209.0 million HKD, a current ratio of 3.86 times, and zero debt-to-equity ratio as of February 29, 2024 Liquidity and Capital Structure Indicators | Metric | As of Feb 29, 2024 | As of Feb 28, 2023 | | :--- | :--- | :--- | | Net Current Assets | 209.0 million HKD | 200.7 million HKD | | Current Ratio | 3.86 times | 3.04 times | | Cash and Bank Balances | 112.0 million HKD | 87.4 million HKD | | Debt-to-Equity Ratio | Zero | Zero | Significant Investments Held by the Group As of February 29, 2024, the Group held a 5.85% equity stake in Taizhou Water Group Co., Ltd., valued at approximately 31.4 million HKD, despite its recent shift from profit to loss Significant Investment Details: Taizhou Water Group Co., Ltd. (1542.HK) | Metric | Value | | :--- | :--- | | Percentage of Shareholding | 5.85% | | Percentage of Total Assets | 11.1% | | Fair Value (thousand HKD) | 31,356 | | Investment Cost (thousand HKD) | 48,159 | | Unrealized Loss (thousand HKD) | 5,031 | - Taizhou Water's FY2023 revenue grew by 11.7% to approximately RMB 606 million, but it recorded a loss attributable to owners of approximately RMB 84.0 million (compared to a profit of approximately RMB 55.9 million in 2022)[62] Use of Proceeds As of February 29, 2024, the Group has fully utilized the net proceeds of approximately 158 million HKD from its IPO, primarily for expanding securities financing and placing and underwriting businesses - The Group has 100% utilized the net IPO proceeds of 158 million HKD[72] Revised Allocation and Use of Net Proceeds (million HKD) | Purpose | Revised Allocated Amount | Amount Utilized | | :--- | :--- | :--- | | Expansion of Placing and Underwriting Business | 40.00 | 40.00 | | Expansion of Securities Financing Business | 92.03 | 92.03 | | Strengthening of Corporate Finance Advisory Business | 0.90 | 0.90 | | Expansion of Asset Management Business | 10.07 | 10.07 | | Working Capital and General Corporate Purposes | 15.00 | 15.00 | | Total | 158.00 | 158.00 | Prospects and Outlook The Group anticipates gradual market improvement with controlled inflation and potential interest rate cuts, but will remain cautious, focusing on risk management, diversification, and Greater Bay Area opportunities amidst geopolitical uncertainties - The macroeconomic environment is expected to improve, but financial markets will remain volatile due to geopolitical factors and uncertainties in China's economic recovery[77] - The Group will continue to strengthen its existing financial services platform while exploring diversification opportunities in new business areas[77] - The Group is optimistic about the Greater Bay Area's development prospects and will focus on cross-border business, leveraging its overseas resources[78] Biographies of Directors and Senior Management Report of the Directors Principal Business and Stakeholder Relationships The Group, a comprehensive financial and securities service provider, maintains strong relationships with key stakeholders and adheres to relevant laws and regulations, with no significant disputes reported during the year - The Group's principal businesses include IPO sponsorship, financial advisory, compliance advisory, placing and underwriting, securities and futures trading, securities financing, asset management, and money lending services[104] - During the year, sales to the Group's top five customers and largest customer accounted for approximately 52.4% and 36.6% of total sales respectively[124] - As of February 29, 2024, the Group had 35 employees, with staff costs of approximately 41.4 million HKD, consistent with the previous year[126][130] Dividends and Reserves The Board resolved not to declare any dividends for the current year, with details of reserve movements presented in the consolidated statement of changes in equity - The Directors do not recommend the payment of any dividend for the current year (2023: nil)[120] Directors and Shareholding Structure The Board members remained stable, with controlling shareholder Mr. Zhong Zhiwen holding 75% of the company's shares through his wholly-owned subsidiary, and no listed securities were purchased, sold, or redeemed during the period Major Shareholders' Shareholding (as of February 29, 2024) | Shareholder Name/Entity | Capacity/Nature of Interest | Number of Securities | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Zhong Zhiwen | Interest in controlled corporation | 300,000,000 shares | 75% | | Baiyang | Beneficial owner | 300,000,000 shares | 75% | | Ms. Li Yanxia | Spouse's interest | 300,000,000 shares | 75% | - The controlling shareholder confirmed continuous compliance with the undertakings under the non-competition deed throughout the year[145] Share Option Scheme The company adopted a new share option scheme on August 18, 2023, replacing the terminated 2018 scheme, with 40 million options granted under the old scheme remaining unexercised as of February 29, 2024 - The 2018 Share Option Scheme was terminated on August 18, 2023, and a new share option scheme was adopted[160][161] Unexercised Share Options (as of February 29, 2024) | Category of Grantees | Number of Unexercised Share Options | Exercise Price (HKD) | Exercise Period | | :--- | :--- | :--- | :--- | | Directors and Chief Executives | 2,400,000 | 0.324 | Sep 9, 2022 to Mar 8, 2032 | | Other Employees and Former Directors | 37,600,000 | 0.324 | Sep 9, 2022 to Mar 8, 2032 | | Total | 40,000,000 | 0.324 | | Corporate Governance Report Board and Committees The company maintains high corporate governance standards with a clearly structured Board comprising executive and independent non-executive directors, supported by audit, remuneration, and nomination committees that met regularly to fulfill their responsibilities - The company confirmed continuous compliance with the code provisions of the Corporate Governance Code throughout the year[182] - The Board comprises 5 directors, including 3 independent non-executive directors, meeting Listing Rules requirements[183][190] Meeting Attendance During the Year | Meeting Type | Number of Meetings Held | Attendance Rate | | :--- | :--- | :--- | | Board Meetings | 6 | Most directors attended all meetings | | General Meetings | 1 | Most directors attended all meetings | | Audit Committee Meetings | 2 | Members generally attended all meetings | | Remuneration Committee Meetings | 1 | All members attended | | Nomination Committee Meetings | 1 | All members attended | Risk Management and Internal Control The Board is ultimately responsible for the Group's risk management and internal control systems, which are annually reviewed and confirmed as effective and adequate, with management overseeing daily operations and reporting to the Board - The Board annually reviews the effectiveness of the risk management and internal control systems[221] - The Group has implemented policies for handling and disclosing inside information to ensure confidentiality and timely disclosure[227] Shareholder Rights and Communication The company prioritizes transparent and timely communication with shareholders through various channels, outlining their rights to convene general meetings, propose resolutions, and make inquiries, while also adopting a dividend policy where payouts are discretionary - Shareholders holding not less than one-tenth of the company's paid-up capital have the right to request an extraordinary general meeting[235] - The company has adopted a dividend policy, but dividend payment is not guaranteed and is subject to the Board's discretion[238] Environmental, Social and Governance Report ESG Strategy and Governance The Group is committed to sustainable development, focusing on operational sustainability, community, diversity, and climate, with the Board overseeing ESG strategy and risk management, identifying key issues through stakeholder engagement - The report is prepared in accordance with the HKEX ESG Reporting Guide, covering the period from March 1, 2023, to February 29, 2024[243][245] - The Board bears overall responsibility for ESG strategy and performance, overseeing related risk management[257] Environmental Protection The Group reduced total energy consumption by 21.0% and greenhouse gas emissions by 24.4% year-on-year through energy-saving measures, and plans further carbon offsetting initiatives Energy Consumption and Greenhouse Gas Emissions | Environmental KPI | 2023/24 Fiscal Year | 2022/23 Fiscal Year | Unit | | :--- | :--- | :--- | :--- | | Total Energy Consumption | 7.02 | 8.89 | MWh | | Total Greenhouse Gas Emissions | 4.77 | 6.31 | metric tons of CO2e | Non-Hazardous Waste Generation | Environmental KPI | 2023/24 Fiscal Year | 2022/23 Fiscal Year | Unit | | :--- | :--- | :--- | :--- | | Total Non-Hazardous Waste Generated | 0.36 | 0.58 | metric tons | - The Group plans to achieve carbon neutrality and local afforestation by purchasing carbon credits to support Amazon forest projects and planting trees in Hong Kong or mainland China[275][277] Employee Care and Development The Group values employees as core assets, providing a fair and safe work environment, competitive compensation, and training, with all employees receiving 12 hours of anti-money laundering and risk management training this year - As of February 29, 2024, the corporate finance advisory business had 12 full-time employees, comprising 8 females and 4 males[282][283] Employee Training Overview | Category | Percentage of Employees Trained | Average Training Hours per Employee | | :--- | :--- | :--- | | By Gender (Male/Female) | 100% | 12.0 | | By Employee Category (Senior/Middle/Junior) | 100% | 12.0 | - No work-related injuries or fatalities occurred within the Group during the reporting period or the past two fiscal years[292] Operating Practices and Community Investment The Group upholds high ethical standards in operations, implementing policies for supply chain, product responsibility, and anti-corruption, while actively engaging in community investment through employee volunteering and green initiatives - The Group has formulated and implemented operating policies covering supply chain management, product responsibility, and anti-corruption[297] - The Group has a whistleblowing policy and provides internal anti-corruption and anti-money laundering training to all employees[303] - The Group plans to create employment opportunities and generate positive social impact in local communities by supporting Amazon forest greening projects[310] Independent Auditor's Report Audit Opinion and Key Audit Matters The independent auditor issued an unmodified opinion on the Group's consolidated financial statements, identifying the impairment assessment of accounts and loans receivable from securities financing services as a key audit matter due to significant management judgment - The auditor believes the consolidated financial statements fairly and truthfully reflect the Group's financial position and performance in accordance with Hong Kong Financial Reporting Standards[312] - A key audit matter is the "Impairment assessment of accounts receivable and loans receivable arising from securities financing services," primarily due to significant judgment and estimation involved in determining expected credit losses[314][316] Consolidated Financial Statements Consolidated Statement of Profit or Loss and Other Comprehensive Income For the year ended February 29, 2024, the Group's total revenue decreased to 32.7 million HKD, but it successfully returned to profitability with a 1.8 million HKD profit, primarily due to 22.4 million HKD in other income Consolidated Statement of Profit or Loss Summary (thousand HKD) | Item | FY2024 | FY2023 | | :--- | :--- | :--- | | Total Revenue | 32,727 | 45,535 | | Other Income | 22,424 | 625 | | Staff Costs | (41,368) | (41,390) | | Profit/(Loss) Before Tax | 1,775 | (6,577) | | Profit/(Loss) for the Year | 1,775 | (6,577) | | Basic Earnings/(Loss) Per Share | 0.44 HK cents | (1.64) HK cents | Consolidated Statement of Financial Position As of February 29, 2024, the Group's total assets were 283.6 million HKD, with net assets of 210.5 million HKD, primarily comprising cash and bank balances and financial assets at fair value through profit or loss Consolidated Statement of Financial Position Summary (thousand HKD) | Item | As of Feb 29, 2024 | As of Feb 28, 2023 | | :--- | :--- | :--- | | Assets | | | | Non-current Assets | 1,509 | 8,303 | | Current Assets | 282,091 | 299,312 | | Total Assets | 283,600 | 307,615 | | Liabilities and Equity | | | | Current Liabilities | 73,111 | 98,571 | | Non-current Liabilities | — | 330 | | Total Liabilities | 73,111 | 98,901 | | Total Equity | 210,489 | 208,714 | Consolidated Statement of Changes in Equity As of February 29, 2024, the Group's total equity increased by 1.8 million HKD to 210.5 million HKD, primarily driven by the profit recorded for the year Summary of Changes in Equity (thousand HKD) | Item | Share Capital | Share Premium | Share Option Reserve | Retained Profits | Total Equity | | :--- | :--- | :--- | :--- | :--- | :--- | | As of Feb 28, 2023 | 4,000 | 169,663 | 6,707 | 28,344 | 208,714 | | Profit for the Year | — | — | — | 1,775 | 1,775 | | As of Feb 29, 2024 | 4,000 | 169,663 | 6,707 | 30,119 | 210,489 | Consolidated Statement of Cash Flows The Group generated 22.7 million HKD from operating activities and 3.4 million HKD from investing activities, resulting in a net increase of 24.6 million HKD in cash and bank balances, reaching 112.0 million HKD at year-end Cash Flow Summary (thousand HKD) | Item | FY2024 | FY2023 | | :--- | :--- | :--- | | Net Cash from Operating Activities | 22,726 | 30,048 | | Net Cash from Investing Activities | 3,442 | 426 | | Net Cash Used in Financing Activities | (1,538) | (1,910) | | Net Increase in Cash and Bank Balances | 24,630 | 28,564 | | Cash and Bank Balances at Beginning of Year | 87,390 | 58,826 | | Cash and Bank Balances at End of Year | 112,020 | 87,390 | Financial Summary Five-Year Financial Summary Over the past five years, the Group's revenue fluctuated, declining to 32.7 million HKD in 2024, while profitability returned to positive in 2024 after a significant loss in 2022, and net assets remained relatively stable Five-Year Financial Data Summary (thousand HKD) | Fiscal Year | 2020 | 2021 | 2022 | 2023 | 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 96,676 | 83,682 | 34,955 | 45,535 | 32,727 | | (Loss)/Profit for the Year | 1,607 | 2,380 | (22,517) | (6,577) | 1,775 | | Net Assets | 228,690 | 231,070 | 208,553 | 208,714 | 210,489 |