WANG ON GROUP(01222) - 2024 - 中期业绩

Interim Financial Highlights This section provides a concise overview of the Group's key financial performance and position for the six months ended September 30, 2023 Interim Financial Highlights for the Six Months Ended September 30, 2023 | Metric | 2023 (Unaudited) HK$ Million | 2022 (Unaudited) HK$ Million | Change | | :--- | :--- | :--- | :--- | | Revenue | 1,136 | 2,050 | -44.6% | | Gross Profit | 435 | 532 | -18.2% | | Profit/(Loss) Attributable to Owners of the Parent | 111 | (24) | +562.5% | | Earnings/(Loss) Per Share—Basic and Diluted (HK Cents) | 0.81 | (0.17) | +576.5% | | Net Assets (as at September 30) | 9,250 | 9,379 | -1.4% | | Net Assets Per Share (HK$) (as at September 30) | 0.60 | 0.61 | -1.6% | | Gearing Ratio (as at September 30) | 57.9% | 49.4% | +8.5 Percentage Points | Condensed Consolidated Financial Statements This section presents the Group's condensed consolidated financial statements, including the statement of profit or loss and other comprehensive income, and the statement of financial position Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended September 30, 2023, the Group's revenue significantly decreased to HK$1,136.1 million from HK$2,050.5 million in the prior period, yet profit for the period substantially increased to HK$189.7 million from HK$2.6 million, primarily driven by a significant rise in share of profits from joint ventures Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Six Months Ended September 30) | Metric | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 1,136,119 | 2,050,479 | | Cost of Sales | (701,427) | (1,518,319) | | Gross Profit | 434,692 | 532,160 | | Other Income and Gains, Net | 94,152 | 74,569 | | Selling and Distribution Expenses | (197,343) | (203,589) | | Administrative Expenses | (253,419) | (270,459) | | Net Impairment Loss on Financial Assets | (12,266) | (11,628) | | Other Expenses, Net | (54,250) | (36,208) | | Finance Costs | (173,426) | (130,910) | | Write-down of Properties Under Development | — | (5,620) | | Write-down of Properties Held for Sale | — | (16,261) | | Net Fair Value Loss on Financial Assets and Liabilities at Fair Value Through Profit or Loss | (10,606) | (23,573) | | Net Fair Value Gain on Investment Properties Owned | 1,921 | 18,599 | | Share of Profits: Joint Ventures | 377,692 | 108,362 | | Share of Profits: Associates | 1,263 | 722 | | Profit Before Tax | 208,410 | 36,164 | | Income Tax Expense | (18,696) | (33,541) | | Profit for the Period | 189,714 | 2,623 | | Profit/(Loss) Attributable to Owners of the Parent | 110,968 | (23,613) | | Profit Attributable to Non-controlling Interests | 78,746 | 26,236 | | Total Comprehensive Loss for the Period | (71,528) | (460,314) | Condensed Consolidated Statement of Financial Position As of September 30, 2023, the Group's total assets slightly increased to HK$18,464.0 million from HK$18,387.1 million, while net assets marginally decreased to HK$9,250.5 million from HK$9,379.4 million, with total current liabilities at HK$5,073.0 million and non-current liabilities at HK$4,140.5 million Condensed Consolidated Statement of Financial Position (As at September 30) | Metric | September 30, 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Non-current Assets | | | | Property, Plant and Equipment | 1,121,267 | 1,195,656 | | Investment Properties | 3,560,996 | 3,764,015 | | Properties Under Development | 2,135,674 | 1,992,527 | | Interests in Joint Ventures | 4,084,869 | 3,638,403 | | Financial Assets at Fair Value Through Other Comprehensive Income | 195,451 | 323,376 | | Financial Assets at Fair Value Through Profit or Loss | 208,802 | 201,934 | | Total Non-current Assets | 11,649,401 | 11,414,567 | | Current Assets | | | | Properties Under Development | 3,021,297 | 2,436,349 | | Properties Held for Sale | 1,190,980 | 1,484,068 | | Inventories | 307,947 | 209,607 | | Trade Receivables | 96,230 | 93,022 | | Loans and Interest Receivables | 308,861 | 290,862 | | Cash and Bank Balances | 1,121,245 | 1,570,628 | | Total Current Assets | 6,814,595 | 6,972,503 | | Total Assets | 18,463,996 | 18,387,070 | | Current Liabilities | | | | Trade Payables | 188,614 | 155,151 | | Other Payables and Accruals | 1,003,686 | 1,024,273 | | Contract Liabilities | 171,887 | 219,225 | | Interest-bearing Bank and Other Borrowings | 3,518,723 | 3,176,660 | | Total Current Liabilities | 5,073,023 | 4,686,727 | | Non-current Liabilities | | | | Interest-bearing Bank and Other Borrowings | 2,938,699 | 2,944,719 | | Deferred Tax Liabilities | 563,932 | 611,887 | | Total Non-current Liabilities | 4,140,515 | 4,320,977 | | Net Assets | 9,250,458 | 9,379,366 | | Total Equity | 9,250,458 | 9,379,366 | Notes to the Condensed Consolidated Interim Financial Information This section provides detailed notes explaining the basis of preparation, changes in accounting policies, segment information, and specific financial line items Basis of Preparation This condensed consolidated interim financial information is prepared in accordance with HKAS 34 and Appendix 16 of the Listing Rules, using the historical cost convention, except for investment properties and certain financial assets measured at fair value, with all figures presented in HK dollars and rounded to the nearest thousand - This condensed consolidated interim financial information is prepared in accordance with Hong Kong Accounting Standard 34 and the disclosure requirements of Appendix 16 of the Listing Rules[50] - The financial information is prepared on the historical cost basis, except for investment properties, financial assets at fair value through other comprehensive income, and financial assets and liabilities at fair value through profit or loss, which are measured at fair value[51] - All figures are presented in Hong Kong dollars and, unless otherwise stated, are rounded to the nearest thousand[51] Changes in Accounting Policies and Disclosures The Group adopted several new and revised HKFRSs, including amendments to HKAS 1, 8, and 12, primarily affecting accounting policy disclosures, the definition of accounting estimates, and deferred tax recognition, with no material impact on the Group's financial position or performance as existing policies align or fall outside the scope of these revisions HKAS 1 (Amendments) HKAS 1 (Amendments) requires entities to disclose material accounting policy information instead of significant accounting policies, applied by the Group from April 1, 2023, impacting annual consolidated financial statements' disclosures but not the interim condensed consolidated financial information - HKAS 1 (Amendments) requires entities to disclose material accounting policy information instead of significant accounting policies[52] - The Group has applied these amendments from April 1, 2023, which are expected to affect the accounting policy disclosures in the Group's annual consolidated financial statements but have no impact on the unaudited condensed consolidated interim financial information[52] HKAS 8 (Amendments) HKAS 8 (Amendments) clarifies the distinction between changes in accounting estimates and policies, defining estimates as monetary amounts in financial statements subject to measurement uncertainty, applied by the Group from April 1, 2023, with no impact due to consistent accounting estimate policies - HKAS 8 (Amendments) clarifies the distinction between changes in accounting estimates and changes in accounting policies, defining an accounting estimate as a monetary amount in financial statements that is subject to measurement uncertainty[39] - The Group has applied the amendments to accounting policy changes and accounting estimate changes occurring on or after April 1, 2023, but these amendments have had no impact on the Group's financial position or performance as the Group's policies for determining accounting estimates are consistent with these amendments[39] HKAS 12 (Amendments) Single Transaction HKAS 12 (Amendments) narrows the scope of initial recognition exemption, requiring entities to recognize deferred tax assets and liabilities for equal taxable and deductible temporary differences arising from transactions like leases and decommissioning liabilities, with no significant impact on the Group's net deferred tax position or financial performance - HKAS 12 (Amendments) narrows the scope of the initial recognition exemption, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences (e.g., leases and decommissioning liabilities)[53] - These amendments have had no significant impact on the net deferred tax asset and deferred tax liability position or the Group's financial position or performance[53] HKAS 12 (Amendments) International Tax Reform HKAS 12 (Amendments) introduces a mandatory temporary exception and disclosure requirements for deferred taxes arising from OECD Pillar Two model rules, applied retrospectively by the Group, with no impact as the Group falls outside the scope of these rules - HKAS 12 (Amendments) introduces a mandatory temporary exception to the recognition and disclosure of deferred taxes arising from the implementation of the Pillar Two model rules issued by the Organisation for Economic Co-operation and Development[40] - The Group has applied these amendments retrospectively, and as the Group is not within the scope of the Pillar Two model rules, these amendments have had no impact on the Group[40] Operating Segment Information The Group's operating segments include property development, property investment, wet markets, pharmaceutical products, and treasury management, with performance assessed by adjusted profit before tax, excluding bank interest income, finance costs, fair value losses on financial assets, and head office expenses, and inter-segment sales transacted at market prices Definition of Operating Segments The Group's five reportable operating segments are property development, property investment (investing in industrial and commercial properties and residential units for rental income or sales profit), wet markets (management and sub-leasing of wet markets and slaughtering businesses, including agricultural product trading markets in Mainland China), pharmaceutical products (production and sale of pharmaceutical and health food products), and treasury management (financing, investment, and asset management of debt and other securities for interest income) - The Group's five reportable operating segments are: Property Development, Property Investment, Wet Markets, Pharmaceutical Products, and Treasury Management[54][83] - The Property Development segment refers to the development of properties[54] - The Property Investment segment refers to the investment in industrial and commercial properties and residential units for rental income or sales profit[83] - The Wet Markets segment refers to the management and sub-leasing of wet markets and slaughtering businesses, which also includes the management of agricultural product trading markets in Mainland China[41] - The Pharmaceutical Products segment refers to the production and sale of pharmaceutical and health food products[54] - The Treasury Management segment refers to financing, investment in debt and other securities for interest income, and asset management through investment vehicles on behalf of the Group's capital partners[83] Reportable Segment Information For the six months ended September 30, 2023, external customer sales revenue for the property development segment significantly decreased to HK$375.1 million from HK$1,358.2 million, while pharmaceutical products' external sales increased to HK$365.4 million from HK$298.7 million, and treasury management's segment result shifted from a loss of HK$14.3 million to a profit of HK$29.7 million Segment Revenue and Results for the Six Months Ended September 30 | Segment | 2023 External Sales (HK$ Thousand) | 2022 External Sales (HK$ Thousand) | 2023 Segment Results (HK$ Thousand) | 2022 Segment Results (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | Property Development | 375,110 | 1,358,229 | 10,105 | 129,995 | | Property Investment | 2,955 | 5,406 | 365,476 | 80,521 | | Pharmaceutical Products | 365,388 | 298,653 | 57,721 | 100,257 | | Wet Markets | 332,707 | 331,272 | 29,692 | (14,269) | | Treasury Management | 59,959 | 56,919 | (18,242) | (32,315) | | Total | 1,136,119 | 2,050,479 | 444,752 | 264,189 | Revenue, Other Income and Gains, Net Total revenue for the period was HK$1,136.1 million, primarily from sales of goods (HK$426.3 million) and property sales (HK$375.1 million), a significant decrease from HK$2,050.5 million in the prior period, while other income and gains, net, increased to HK$94.2 million, mainly due to higher bank interest income and government grants Revenue Analysis For the six months ended September 30, 2023, the Group's total revenue was HK$1,136.1 million, primarily from sales of goods (HK$426.3 million) and property sales (HK$375.1 million), with a significant decrease in property sales revenue and an increase in goods sales revenue compared to the prior period Revenue Sources (For the Six Months Ended September 30) | Revenue Source | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Sales of Properties | 375,110 | 1,358,229 | | Sales of Goods | 426,250 | 349,762 | | Commission Income from Operating Agricultural Product Trading Markets | 45,136 | 51,505 | | Ancillary Services for Agricultural Product Trading Markets | 44,752 | 47,390 | | Provision of Asset Management Services | 26,185 | 9,107 | | Interest Income from Treasury Business | 32,171 | 42,693 | | Sub-leasing Income | 93,537 | 85,961 | | Gross Rental Income from Operating Leases of Investment Properties | 91,375 | 100,713 | | Dividend Income from Financial Assets | 2,250 | 6,107 | | Loss on Disposal of Financial Assets at Fair Value Through Profit or Loss | (647) | (988) | | Total Revenue | 1,136,119 | 2,050,479 | - For the six months ended September 30, 2023, total revenue from contracts with customers was HK$917,433 thousand, with HK$375,110 thousand from sales of properties and HK$365,388 thousand from sales of goods[87] - For the six months ended September 30, 2022, total revenue from contracts with customers was HK$1,815,993 thousand, with HK$1,358,229 thousand from sales of properties and HK$298,653 thousand from sales of goods[61] Other Income and Gains, Net Analysis Other income and gains, net, for the period increased to HK$94.2 million from HK$74.6 million in the prior period, primarily driven by higher bank interest income (HK$9.2 million vs HK$3.2 million) and gains from disposal of property, plant and equipment (HK$13.3 million), while government grants decreased from HK$4.7 million to HK$1.2 million Other Income and Gains, Net Analysis (For the Six Months Ended September 30) | Item | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Bank Interest Income | 9,217 | 3,162 | | Management Fee Income | 6,158 | 6,419 | | Forfeiture of Customers' Deposits | 4,992 | 4,655 | | Government Subsidies | 1,180 | 4,739 | | Others | 49,950 | 39,906 | | Gain on Disposal of a Subsidiary | — | 14,551 | | Gain on Early Redemption of Unsecured Notes | 7,903 | 774 | | Gain on Modification/Termination of Lease Contracts | 1,410 | — | | Gain on Disposal of Investment Properties | — | 363 | | Gain on Disposal of Property, Plant and Equipment Items | 13,330 | — | | Net Gain on Disposal/Redemption of Financial Assets at Fair Value Through Other Comprehensive Income | 12 | — | | Total Other Income and Gains, Net | 94,152 | 74,569 | Finance Costs For the six months ended September 30, 2023, the Group's finance costs increased to HK$173.4 million from HK$130.9 million in the prior period, primarily due to higher interest on bank and other borrowings (HK$204.2 million vs HK$123.3 million), partially offset by increased capitalized interest Finance Costs Analysis (For the Six Months Ended September 30) | Item | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 204,245 | 123,260 | | Interest on Lease Liabilities | 25,153 | 21,983 | | Interest on Unsecured Notes | 5,552 | 12,153 | | Total Finance Costs | 234,950 | 157,396 | | Less: Interest Capitalized | (61,524) | (26,486) | | Net Finance Costs | 173,426 | 130,910 | Profit Before Tax The Group's profit before tax includes various expenses and gains such as cost of services, property sales cost, inventory cost, depreciation, net impairment losses, and net exchange differences, with a significant increase in net impairment loss on property, plant and equipment to HK$48.8 million from HK$8.5 million in the prior period Items Deducted From/(Credited To) Profit Before Tax (For the Six Months Ended September 30) | Item | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Cost of Services Provided | 100,067 | 101,823 | | Cost of Properties Sold | 302,892 | 1,158,784 | | Cost of Inventories Recognized as Expense | 218,026 | 197,641 | | Depreciation of Owned Assets | 28,859 | 30,779 | | Depreciation of Right-of-use Assets | 40,343 | 40,234 | | Net Loss/(Gain) on Disposal of Property, Plant and Equipment | (13,330) | 320 | | Loss/(Gain) on Disposal of a Subsidiary | 2,665 | (14,551) | | Fair Value Loss on Sub-leased Investment Properties | 80,214 | 59,979 | | Net Impairment Loss on Property, Plant and Equipment Items | 48,809 | 8,474 | | Net Loss/(Gain) on Disposal/Redemption of Financial Assets at Fair Value Through Other Comprehensive Income | (12) | 23,027 | | Net Impairment Loss on Financial Assets | 12,266 | 11,628 | | Net Exchange Differences | 2,776 | 4,387 | | Direct Operating Expenses Arising from Investment Properties That Generated Rental Income | 228 | 92 | - For the six months ended September 30, 2022, wage subsidies of HK$17,556,000 granted under the Employment Support Scheme of the Anti-epidemic Fund were received and recognized in "Administrative expenses" to offset employee benefit expenses[68] Income Tax The Group's income tax expense, comprising Hong Kong profits tax, corporate income tax in other jurisdictions, and PRC Land Appreciation Tax, decreased to HK$18.7 million for the six months ended September 30, 2023, from HK$33.5 million in the prior period, mainly due to increased deferred tax credits and reduced PRC tax expenses Income Tax Expense (For the Six Months Ended September 30) | Item | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Current — Hong Kong | 7,912 | 9,820 | | Current — Expense for the Period in Other Jurisdictions | 9,551 | 19,403 | | Land Appreciation Tax | 9,436 | 4,846 | | Deferred | (8,203) | (528) | | Total Tax Expense for the Period | 18,696 | 33,541 | - Hong Kong profits tax is provided at a rate of 16.5% on the estimated assessable profit for the period[22] - PRC Land Appreciation Tax is provided at a progressive tax rate range on the appreciation value[22] Earnings/(Loss) Per Share Attributable to Owners of the Parent For the six months ended September 30, 2023, profit attributable to owners of the parent was HK$111.0 million, with basic and diluted earnings per share of HK$0.81 cents, a significant improvement from a loss of HK$23.6 million and HK$0.17 cents per share in the prior period, with no dilutive effect from China Agri-Products' share options Calculation of Basic and Diluted Earnings/(Loss) Per Share (For the Six Months Ended September 30) | Item | 2023 (HK$ Thousand/Thousand Shares) | 2022 (HK$ Thousand/Thousand Shares) | | :--- | :--- | :--- | | Profit/(Loss) Attributable to Owners of the Parent | 110,968 | (23,613) | | Weighted Average Number of Ordinary Shares in Issue | 15,355,711 | 15,977,520 | | Less: Weighted Average Number of Treasury Shares | (1,716,749) | (1,716,749) | | Weighted Average Number of Ordinary Shares for Basic and Diluted Earnings/(Loss) Per Share Calculation | 13,638,962 | 14,260,771 | | Basic and Diluted Earnings/(Loss) Per Share (HK Cents) | 0.81 | (0.17) | - The share options issued by China Agri-Products had no dilutive effect on the basic earnings/(loss) per share amounts presented[96] Loans and Interest Receivables As of September 30, 2023, the Group's total loans and interest receivables amounted to HK$337.9 million, with a current portion of HK$308.9 million; secured loans are accounted for at effective annual interest rates of 5% to 27%, and unsecured loans at 1% to 33%, with some overdue loans classified as Stage 2 or 3 reflecting expected credit losses Loans and Interest Receivables (As at September 30) | Item | 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Loans and Interest Receivables, Secured | 325,260 | 309,108 | | Loans and Interest Receivables, Unsecured | 85,747 | 79,074 | | Total | 411,007 | 388,182 | | Less: Impairment Allowance | (73,153) | (75,723) | | Net | 337,854 | 312,459 | | Less: Loans and Interest Receivables Classified as Non-current Assets | (28,993) | (21,597) | | Current Portion | 308,861 | 290,862 | - Secured loans and interest receivables are accounted for at amortized cost with effective annual interest rates ranging from 5% to 27%, and credit periods ranging from 1 month to 10 years[127] - Unsecured loans and interest receivables are accounted for at amortized cost with effective annual interest rates ranging from 1% to 33%, and credit periods ranging from 1 month to 72 months[99] - As of September 30, 2023, HK$52,319 thousand and HK$138,090 thousand of loans and interest receivables were overdue and classified as Stage 2 and Stage 3 respectively, for the assessment of expected credit losses[128] Trade Receivables As of September 30, 2023, the Group's net trade receivables slightly increased to HK$96.2 million from HK$93.0 million, with strict credit risk control and regular review of overdue balances, and trade receivables are interest-free with no significant concentration of credit risk Trade Receivables (As at September 30) | Item | 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Trade Receivables | 120,072 | 117,166 | | Less: Accumulated Impairment | (23,842) | (24,144) | | Net | 96,230 | 93,022 | Ageing Analysis of Trade Receivables (As at September 30) | Ageing | 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Within 1 Month | 57,285 | 48,599 | | 1 to 3 Months | 17,295 | 24,898 | | Over 3 Months but Within 6 Months | 17,216 | 12,864 | | Over 6 Months | 4,434 | 6,661 | | Total | 96,230 | 93,022 | - The Group's credit period generally ranges from 7 to 120 days, and credit limits are reviewed regularly to maintain strict control and minimize credit risk[129] Trade Payables As of September 30, 2023, the Group's trade payables increased to HK$188.6 million from HK$155.2 million, with interest-free terms and average credit periods ranging from 30 to 360 days, and the Group has established financial risk management policies to ensure timely payment of all payables within credit terms Ageing Analysis of Trade Payables (As at September 30) | Ageing | 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Within 1 Month | 126,014 | 104,921 | | 1 to 3 Months | 17,374 | 11,236 | | Over 3 Months but Within 6 Months | 2,976 | 1,117 | | Over 6 Months | 42,250 | 37,877 | | Total | 188,614 | 155,151 | - Trade payables are interest-free and have an average credit period ranging from 30 to 360 days[103] - The Group has established financial risk management policies to ensure that all payables are paid within the credit period[103] Comparative Amounts The Group has reclassified certain comparative amounts to conform with the current period's presentation and disclosure - Certain comparative amounts have been reclassified to conform with the current period's presentation and disclosure[131] Management Discussion and Analysis This section provides an in-depth analysis of the Group's financial performance, business operations, liquidity, and future outlook Financial Results For the six months ended September 30, 2023, the Group's revenue decreased by 44.6% to HK$1,136.1 million, primarily due to fewer property development project deliveries; despite this, profit attributable to owners of the parent turned from a loss of HK$23.6 million to a profit of HK$111.0 million, mainly driven by increased share of joint venture results and pharmaceutical sales growth, partially offset by higher finance costs Revenue The Group's revenue for the period decreased by approximately 44.6% to about HK$1,136.1 million, primarily due to reduced sales from property development projects where the Group holds controlling interests - The Group's revenue for the period decreased by approximately 44.6% to approximately HK$1,136.1 million (six months ended September 30, 2022: approximately HK$2,050.5 million)[21] - The decrease in revenue was primarily due to reduced sales from property development projects where the Group holds controlling interests during the period[21] Gross Profit and Gross Profit Margin The Group recorded a gross profit of approximately HK$434.7 million with a gross profit margin of 38.3% for the period, a change from HK$532.2 million and 26.0% in the prior period, with the decrease in gross profit mainly attributable to fewer property project deliveries Gross Profit and Gross Profit Margin (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Gross Profit | 434.7 | 532.2 | | Gross Profit Margin | 38.3% | 26.0% | - The decrease in gross profit was mainly due to fewer property project deliveries during the period[135] Profit/(Loss) Attributable to Owners of the Parent Profit attributable to owners of the parent for the period was approximately HK$111.0 million, a significant improvement from a loss of HK$23.6 million in the prior period, primarily driven by increased share of joint venture results and higher sales and gross profit from pharmaceutical and health food products, partially offset by reduced gross profit from fewer property project deliveries and increased finance costs Profit/(Loss) Attributable to Owners of the Parent (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Profit/(Loss) Attributable to Owners of the Parent | 111.0 | (23.6) | - The increase in profit was mainly due to (i) an increase in the share of results of joint ventures, and (ii) an increase in sales and gross profit generated from the production and sale of pharmaceutical and health food products[106] - This was partially offset by (a) a decrease in gross profit due to fewer property project deliveries and (b) an increase in finance costs compared to the same period in 2022 due to rising interest rates[106] Other Income and Gains, Net Other income and gains, net, for the period increased to approximately HK$94.2 million from HK$74.6 million in the prior period, primarily due to gains from the disposal of property, plant and equipment items Other Income and Gains, Net (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Other Income and Gains, Net | 94.2 | 74.6 | - The increase was mainly due to gains from the disposal of property, plant and equipment items[107] Expenses Administrative expenses of approximately HK$253.4 million, selling and distribution expenses of HK$197.3 million, and net impairment loss on financial assets of HK$12.3 million remained stable and controlled compared to the prior period, while other expenses of HK$54.3 million increased primarily due to higher impairment losses on property, plant and equipment Key Expenses (For the Six Months Ended September 30) | Expense Category | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Administrative Expenses | 253.4 | 270.5 | | Selling and Distribution Expenses | 197.3 | 203.6 | | Net Impairment Loss on Financial Assets | 12.3 | 11.6 | | Other Expenses | 54.3 | 36.2 | - The increase in other expenses was mainly due to increased impairment losses on property, plant and equipment[25] Net Fair Value Loss on Financial Assets and Liabilities Net fair value loss on financial assets and liabilities at fair value through profit or loss for the period decreased to approximately HK$10.6 million from HK$23.6 million in the prior period, primarily due to reduced fair value losses on fund investments Net Fair Value Loss on Financial Assets and Liabilities (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Net Fair Value Loss | 10.6 | 23.6 | - The decrease was mainly due to reduced fair value losses on financial assets at fair value through profit or loss, primarily fund investments[109] Property Write-downs There were no write-downs of properties under development or properties held for sale during the period, compared to write-downs of approximately HK$5.6 million for properties under development and HK$16.3 million for properties held for sale in the prior period Property Write-downs (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Write-down of Properties Under Development | — | 5.6 | | Write-down of Properties Held for Sale | — | 16.3 | - The write-down of properties under development in the same period of 2022 related to a property under development in Hong Kong[110] - The write-down of properties held for sale in the same period of 2022 related to a commercial property held for sale in Hong Kong and two agricultural product trading markets in Mainland China[139] Net Fair Value Gain on Investment Properties Net fair value gain on investment properties owned for the period was approximately HK$1.9 million, a decrease from HK$18.6 million in the prior period, primarily due to reduced net fair value gains on several investment properties in Mainland China Net Fair Value Gain on Investment Properties (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Net Fair Value Gain | 1.9 | 18.6 | - The decrease was mainly due to reduced net fair value gains on several investment properties in Mainland China[138] Share of Profits of Joint Ventures Share of profits of joint ventures for the period significantly increased to approximately HK$377.7 million from HK$108.4 million in the prior period, primarily due to increased profit contributions from the commercial portfolio Share of Profits of Joint Ventures (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Share of Profits of Joint Ventures | 377.7 | 108.4 | - The increase was mainly due to increased profit contributions from the commercial portfolio[111] Finance Costs Finance costs for the period increased to approximately HK$173.4 million from HK$130.9 million in the prior period, primarily due to higher interest expenses Finance Costs (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Finance Costs | 173.4 | 130.9 | - The increase was mainly due to higher interest expenses[137] Income Tax Expense Income tax expense for the period decreased to approximately HK$18.7 million from HK$33.5 million in the prior period, primarily due to increased deferred tax credits and reduced PRC tax expenses Income Tax Expense (For the Six Months Ended September 30) | Metric | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Income Tax Expense | 18.7 | 33.5 | - The decrease was mainly due to increased deferred tax credits and reduced PRC tax expenses during the period compared to the same period in 2022[112] Business Review The Group's business review covers five segments: property development, wet markets and agricultural product trading markets, property investment, pharmaceutical and health food products, and treasury management, with property development revenue declining due to fewer Hong Kong project deliveries but slight growth in China, stable wet market revenue and expansion in China's agricultural product trading markets, diversified property investment including joint ventures, a 22.3% increase in total pharmaceutical business revenue with significant progress in both Chinese and Western medicine products, and a decrease in treasury management's lending business revenue offset by an increase in asset management services revenue due to new managed assets Property Development Property development segment revenue primarily derives from Wang On Properties Group's residential and commercial property sales in Hong Kong and China Agri-Products Group's property sales in China, with Hong Kong property development revenue significantly decreasing due to fewer deliveries, while China property development revenue slightly increased due to more deliveries Hong Kong Property Development Wang On Properties Group's property development segment contributed approximately HK$258.4 million in revenue for the period, primarily from sales of 'The Met. Azure' and 'LADDER Dundas', a significant decrease from HK$1,250.0 million in the prior period Wang On Properties Group Property Development Segment Contribution to Revenue (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Wang On Properties Group Property Development Segment Contribution to Revenue | 258.4 | 1,250.0 | - Revenue was mainly due to the recognition of sales from "The Met. Azure" and "LADDER Dundas"[114] China Property Development The Group's property development business in China (through China Agri-Products Group) recorded revenue of approximately HK$116.7 million for the period, a slight increase from HK$108.2 million in the prior period, primarily due to increased deliveries of properties for sale China Property Development Business Revenue (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | China Property Development Business Revenue | 116.7 | 108.2 | - The slight increase in revenue was mainly due to increased deliveries of properties for sale during the period compared to the same period in 2022[144] Development Land Portfolio Wang On Properties Group's development land portfolio comprises various residential and commercial projects in Hong Kong with expected completion years ranging from 2023 to 2028, and the Group actively seeks to increase land bank through public tenders and acquisition of old buildings Wang On Properties Group Development Land Portfolio (As at the Date of this Announcement) | Location | Approximate Site Area (sq. ft.) | Approximate Gross Floor Area (sq. ft.) | Intended Use | Expected Completion Year | | :--- | :--- | :--- | :--- | :--- | | Pok Fu Lam Project | 28,500 | 28,500 | Residential | 2023 | | Tai Kok Tsui Project | 6,800 | 61,500 | Residential and Commercial | 2024 | | Ap Lei Chau Project I | 7,200 | 74,200 | Residential and Commercial | 2025 | | Ap Lei Chau Project II | 4,100 | 38,500 | Residential and Commercial | 2025 | | Wong Tai Sin Project I | 9,600 | 81,300 | Residential and Commercial | 2025 | | Wong Tai Sin Project II | 10,400 | 93,700 | Residential and Commercial | 2025 | | Ngau Tau Kok Project | 5,200 | 46,300 | Residential and Commercial | 2025 | | Fortress Hill Project | 12,400 | 131,600 | Residential and Commercial | 2026 | | Quarry Bay Project | 4,200 | 39,100 | Residential and Commercial | 2026 | | Ap Lei Chau Project III | 6,600 | 68,800 | Residential and Commercial | 2027 | | Yau Tong Project | 41,700 | 269,000 | Residential and Commercial | 2028 | - Wang On Properties Group is actively seeking various channels to increase its land bank, including participating in public tenders and acquiring old buildings[146] Wet Markets and Agricultural Product Trading Markets The Group, with over two decades of experience in wet markets and agricultural product trading markets, saw segment revenue slightly increase by 0.4% to approximately HK$332.7 million for the period, primarily contributed by China Agri-Products Group (HK$193.8 million) and Hong Kong wet market operations (HK$138.9 million), with stable slaughtering business revenue and a renewed lease for the Chung On Shopping Centre wet market Hong Kong Wet Market Operations The Group manages approximately 600 stalls under the 'Man Yau' and 'Daily Fresh' brands in Hong Kong, totaling over 150,000 sq. ft. of floor area, enhancing the shopping environment and strengthening relationships with tenants and local communities through thoughtful layout design, improvement works, and quality management services - The Group manages approximately 600 stalls under the "Man Yau" and "Daily Fresh" brands in Hong Kong, with a total floor area of over 150,000 sq. ft.[117] - The Group aims to provide a more comfortable and spacious shopping environment and strengthen relationships with tenants and local communities through thoughtful layout design, improvement works, and quality management services[117] - The Group received notification from Link Properties Limited agreeing to renew the lease for Chung On Shopping Centre wet market for a term of six years, until January 31, 2029[174] Slaughtering Business The slaughtering business generated stable revenue of approximately HK$35.1 million for the period, consistent with HK$35.0 million in the prior period, with 18 operational meat stalls as of September 30, 2023, and the Group considers this business to have low development risk Slaughtering Business Revenue (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Slaughtering Business Revenue | 35.1 | 35.0 | - As of September 30, 2023, there were 18 operational meat stalls[118] China Agricultural Product Trading Markets The Group, through China Agri-Products Group, operates 11 agricultural product trading markets across five provinces in China, significantly expanding its business scope and establishing a solid position in the industry, providing a foundation for future sustained development and expansion - The Group currently operates 11 agricultural product trading markets across five provinces in China through China Agri-Products Group[175] - The acquisition of these agricultural product trading markets has significantly expanded the Group's business in the wet markets and agricultural product trading markets segment in China, providing a solid foundation for future sustained development and expansion[175] Property Investment The Group's property investment portfolio includes owned investment properties and several joint venture projects, with owned investment properties totaling approximately HK$3,561.0 million in book value as of September 30, 2023, and joint venture properties like Tuen Mun Tin Sang Building, Ma On Shan 'Lake Silver' and Tseung Kwan O 'The Parkside' commercial properties, and Aberdeen Jumbo Court car park platform generally exhibiting high occupancy rates Owned Investment Properties As of September 30, 2023, the Group's owned investment properties in Hong Kong and China, comprising commercial, industrial, and residential units, had a total book value of approximately HK$3,561.0 million, a decrease from HK$3,764.0 million as of March 31 Total Book Value of Owned Investment Properties (As at September 30) | Item | 2023 (HK$ Million) | March 31, 2023 (HK$ Million) | | :--- | :--- | :--- | | Total Book Value of Owned Investment Properties | 3,561.0 | 3,764.0 | Joint Venture Property Investments Wang On Properties Group participates in several joint venture property investments, including a 64% interest in the Tuen Mun Tin Sang Building joint venture, which is fully leased with some shop units sold; commercial properties 'Lake Silver' and 'The Parkside' in partnership with KKR have been renovated, improving tenant mix and achieving 100% and over 97% occupancy rates respectively; and the Jumbo joint venture acquired the Aberdeen Jumbo Court car park platform, fully leased and expected to meet future parking demand - Wang On Properties Group holds a 64% interest in the Tin Sang Building joint venture, which is fully leased, and 3 out of 15 shop units have been sold[149] - Wang On Properties Group, in partnership with KKR, holds a 50% equity interest in two commercial properties, "Lake Silver" in Ma On Shan and "The Parkside" in Tseung Kwan O, which have been renovated to improve tenant mix and increase rental yields, with Lake Silver fully leased and The Parkside achieving an occupancy rate of over 97%[150] - The Jumbo joint venture acquired an 8-story car park platform at Jumbo Court in Aberdeen, providing 509 parking spaces, which is expected to meet significant parking demand and is currently fully leased[177] Second-hand Residential Properties and Property Disposals As of September 30, 2023, the Group still holds 8 second-hand residential properties valued at approximately HK$42.8 million and will continue to seek suitable disposal opportunities, while Watsons Group completed two property disposals during the period for a total consideration of HK$137.8 million - As of September 30, 2023, the Group still held 8 second-hand residential properties with an estimated value of approximately HK$42.8 million, and will continue to seek suitable opportunities for disposal[151] - Watsons Group completed the disposal of a company holding a property at 11/F, Po Shing Industrial Building, 13 Ko Fai Road, Kowloon, Hong Kong for HK$71.0 million, and the sale of a property at Shop B and part of the open area on the ground floor of 66, 68, 70 and 72 Tai Wai Road, Sha Tin, New Territories, Hong Kong for HK$66.8 million[178] Pharmaceutical and Health Food Products Business Total revenue for the pharmaceutical and health food products segment grew by approximately 22.3% to HK$365.4 million for the period, with Chinese medicine and health food products revenue significantly increasing by 23.8% alongside the establishment of a central decoction center and R&D collaboration with Hong Kong Polytechnic University; Western medicine and health food products revenue rose by 10.3%, with flagship brand 'Madame Pearl's' retaining its top cough syrup sales position and 'Pett's' mosquito repellent products performing well, while e-commerce and China market channels are actively being developed Chinese Medicine and Health Food Products Revenue from Chinese medicine and health food products segment significantly increased by approximately 23.8% to HK$329.0 million, with Watsons Group establishing a central decoction center, expanding retail stores, entering e-commerce platforms, and collaborating with Hong Kong Polytechnic University on new product development like Cordyceps Cs4 Nano Selenium, earning Watsons the 'Most Frequently Used Chinese Health Product Brand in the Past 12 Months' award Chinese Medicine and Health Food Products Revenue (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Chinese Medicine and Health Food Products Revenue | 329.0 | 265.7 | | Year-on-year Growth | +23.8% | | - Watsons Group established a central decoction center in August 2023, offering 24-hour Chinese medicine delivery services[153] - Watsons Group collaborated with The Hong Kong Polytechnic University, discovering that Cordyceps Cs4 Nano Selenium helps promote osteocyte and bone matrix formation[181] - Watsons Group was awarded the title of "Most Frequently Used Chinese Health Product Brand in the Past 12 Months"[124] Western Medicine and Health Food Products Western medicine and health food products revenue increased by approximately 10.3% to HK$36.4 million, with flagship brand 'Madame Pearl's' maintaining its 13-year reign as Hong Kong's top-selling cough syrup and 'Pett's' mosquito repellent products achieving favorable revenue, while Watsons Group actively develops e-commerce channels and collaborates with local distributors to accelerate 'Madame Pearl's' and 'Pett's' brand penetration in China Western Medicine and Health Food Products Revenue (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Western Medicine and Health Food Products Revenue | 36.4 | 33.0 | | Year-on-year Growth | +10.3% | | - "Madame Pearl's" has been the top-selling cough syrup in Hong Kong for 13 consecutive years[184] - Watsons Group has actively invested resources in establishing e-commerce channels, including its own online platforms and selected third-party e-commerce platforms[158] - Watsons Group has collaborated with several local distributors to accelerate the channel penetration of "Madame Pearl's" and "Pett's" brands in China[185] Treasury Management Treasury management encompasses lending and asset management services; lending business revenue decreased by 30.6% to HK$16.3 million due to uncertain economic outlook and a more cautious lending approach, while asset management services revenue increased to HK$26.2 million due to new managed assets, with Wang On Properties Group establishing joint ventures with strategic partners to provide these services Lending Business Lending business contributed approximately HK$16.3 million in revenue for the period, a decrease of about 30.6%, primarily due to reduced market demand amid an uncertain economic outlook and the Group's more cautious lending approach; as of September 30, 2023, the total loan portfolio was approximately HK$290.0 million, with 82.8% secured and 17.2% unsecured, carrying weighted average annual interest rates of approximately 13.2% and 13.9% respectively Lending Business Revenue (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Lending Business Revenue | 16.3 | 23.5 | | Year-on-year Change | -30.6% | | - The decrease in revenue from the loan portfolio was due to a general decline in market demand caused by an uncertain economic outlook, and the Group's more cautious approach when accepting potential loan applications in a risky environment[162] - As of September 30, 2023, the Group had 42 active loan accounts with a total loan balance of approximately HK$290.0 million, of which 82.8% were secured loans and 17.2% were unsecured loans[190] - The weighted average annual interest rate for secured loans was approximately 13.2%, and for unsecured loans, it was approximately 13.9%[162] Asset Management Wang On Properties Group recorded asset management fee income of approximately HK$26.2 million for the period, a significant increase from HK$9.1 million in the prior period, primarily due to the addition of new managed assets; Wang On Properties Group has established joint ventures with several strategic partners to provide asset management services, including hotel renovation projects and residential property development Asset Management Fee Income (For the Six Months Ended September 30) | Item | 2023 (HK$ Million) | 2022 (HK$ Million) | | :--- | :--- | :--- | | Fee Income | 26.2 | 9.1 | | Year-on-year Growth | +187.9% | | - The increase was mainly due to the addition of new managed assets[193] - Wang On Properties Group formed a joint venture with Angelo, Gordon & Co. L.P. to acquire and renovate a hotel building at 19 Luk Hop Street, Kowloon, Hong Kong, expected to reopen in the first quarter of 2024[165] - Wang On Properties Group partnered with APG Strategic Real Estate Pool to acquire residential properties in Hong Kong for development and redevelopment for sale[166] Liquidity and Financial Resources As of September 30, 2023, the Group's total assets were approximately HK$18,464.0 million, with cash resources of HK$1,333.0 million; total equity decreased to HK$9,250.5 million, and total borrowings increased to HK$6,536.3 million, resulting in a net gearing ratio of 57.9%, as the Group continues to strengthen financial risk control and maintain a prudent financial management approach Assets and Cash Resources As of September 30, 2023, the Group's total assets were approximately HK$18,464.0 million, with cash resources of HK$1,333.0 million, comprising cash and bank balances of HK$1,184.9 million and short-term investments of HK$148.1 million; total liquid investments, cash and bank balances amounted to HK$1,737.3 million, a 23.6% decrease from March 31 Assets and Cash Resources (As at September 30) | Item | 2023 (HK$ Million) | March 31, 2023 (HK$ Million) | | :--- | :--- | :--- | | Total Assets | 18,464.0 | 18,387.1 | | Total Cash Resources | 1,333.0 | 1,749.0 | | Of which: Cash and Bank Balances | 1,184.9 | 1,616.3 | | Of which: Short-term Investments | 148.1 | 132.7 | | Total Liquid Investments, Cash and Bank Balances | 1,737.3 | 2,274.3 | | Year-on-year Change | -23.6% | | Equity As of September 30, 2023, equity attributable to owners of the parent decreased by approximately 0.3% to HK$5,900.9 million, and the Group's total equity (including non-controlling interests) decreased to HK$9,250.5 million Equity (As at September 30) | Item | 2023 (HK$ Million) | March 31, 2023 (HK$ Million) | | :--- | :--- | :--- | | Equity Attributable to Owners of the Parent | 5,900.9 | 5,916.3 | | Total Equity (Including Non-controlling Interests) | 9,250.5 | 9,379.4 | | Change in Equity Attributable to Owners of the Parent | -0.3% | | Debt and Net Gearing Ratio As of September 30, 2023, the Group's total debt increased to approximately HK$6,536.3 million from HK$6,246.6 million, with the net gearing ratio rising by 8.5 percentage points to 57.9% from 49.4% as of March 31 Debt and Net Gearing Ratio (As at September 30) | Item | 2023 (HK$ Million) | March 31, 2023 (HK$ Million) | | :--- | :--- | :--- | | Total Debt | 6,536.3 | 6,246.6 | | Net Gearing Ratio | 57.9% | 49.4% | | Change in Net Gearing Ratio | +8.5 Percentage Points | | - The net gearing ratio is calculated as net debt divided by total equity; net debt is calculated as the total of interest-bearing bank and other borrowings, unsecured notes, and convertible notes, less cash and cash equivalents, restricted bank balances, and pledged deposits[198] Pledged Assets As of September 30, 2023, approximately HK$506.8 million in property, plant and equipment, HK$1,968.7 million in investment properties, HK$4,945.9 million in properties under development, HK$352.9 million in properties held for sale, and HK$58.3 million in pledged deposits were pledged as collateral for the Group's general banking facilities Book Value of Pledged Assets (As at September 30) | Asset Category | 2023 (HK$ Million) | March 31, 2023 (HK$ Million) | | :--- | :--- | :--- | | Property, Plant and Equipment | 506.8 | 539.8 | | Investment Properties | 1,968.7 | 2,218.0 | | Properties Under Development | 4,945.9 | 4,187.6 | | Properties Held for Sale | 352.9 | 601.4 | | Financial Assets at Fair Value Through Other Comprehensive Income | 0 | 126.9 | | Financial Assets at Fair Value Through Profit or Loss | 0 | 12.1 | | Pledged Deposits | 58.3 | 33.5 | - The aforementioned assets were pledged as collateral for the Group's general banking facilities[170] Contingent Liabilities As of September 30, 2023, the Group's capital commitments were approximately HK$1,407.6 million, primarily for property development, with capital commitments attributable to joint ventures of HK$186.5 million; the Group also provided bank guarantees up to HK$700.8 million for a joint venture's financing, of which HK$426.5 million was utilized, and guarantees of approximately HK$27.2 million for certain bank loans to customers of properties sold Contingent Liabilities (As at September 30) | Item | 2023 (HK$ Million) | March 31, 2023 (HK$ Million) | | :--- | :--- | :--- | | Capital Commitments of the Group | 1,407.6 | 1,409.3 | | Capital Commitments Attributable to Joint Ventures | 186.5 | 110.9 | | Bank Guarantees for Joint Venture Financing (Maximum) | 700.8 | 450.8 | | Bank Guarantees for Joint Venture Financing (Utilized) | 426.5 | 250.3 | | Loan Guarantees Provided to Customers of Properties Sold | 27.2 | 36.1 | | Contingent Liabilities Related to Guarantees | 0.176 | 0.328 | Analysis of Interest-bearing Debt Portfolio As of September 30, 2023, the Group's total interest-bearing debt was approximately HK$6,536.3 million, with HK$749.8 million at fixed rates and HK$5,786.5 million at floating rates, and debt repayment periods distributed across within one year or on demand, second year, third to fifth year, and over five years Repayment Schedule of Interest-bearing Bank and Other Borrowings (As at September 30) | Repayment Period | 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Within 1 Year or On Demand | 2,991,238 | 2,964,731 | | In the 2nd Year | 1,576,253 | 2,251,228 | | In the 3rd to 5th Year (Inclusive) | 1,298,246 | 672,976 | | Over 5 Years | 64,200 | 20,515 | | Total | 5,929,937 | 5,909,450 | Repayment Schedule of Other Loans (As at September 30) | Repayment Period | 2023 (HK$ Thousand) | March 31, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Within 1 Year or On Demand | 78,923 | — | | In the 2nd Year | — | 125,189 | | Total | 78,923 | 125,189 | - As of September 30, 2023, the Group's total interest-bearing debt was approximately HK$6,536.3 million, of which approximately HK$749.8 million bore interest at fixed rates, while the remaining debt of approximately HK$5,786.5 million bore interest at floating rates[202] Financial Risk Management The Group continuously strengthens and improves financial risk control, adhering to a prudent financial management approach, ensuring efficient and effective operations while maintaining flexibility to address opportunities and changes through close monitoring of financial resources, and management believes the current financial structure is healthy with sufficient resources for foreseeable operational needs - The Group continuously strengthens and improves financial risk control and adheres to a prudent financial management approach[224] - Operating a centralized cash management system helps optimize cash flow and minimize idle cash, while prudent investment in liquid investments generates reasonable returns and maintains liquidity[224] - The Group's management believes that the Group's current financial structure is healthy, and its resources are sufficient to meet its operational needs for the foreseeable future[224] Significant Investments Held, Material Acquisitions and Disposals of Subsidiaries, and Future Plans for Material Investments or Capital Assets As of September 30, 2023, the Group held approximately HK$262.6 million in financial assets at fair value through other comprehensive income and HK$289.8 million in financial assets at fair value through profit or loss; during the reporting period, the Company completed the acquisition of approximately 20.17% equity in China Agri-Products, increasing its stake to about 73.54%, and Watsons Group signed a provisional agreement for property disposal post-reporting period, with no other future plans for material investments or capital assets beyond these disclosures Financial Asset Investments As of September 30, 2023, the Group held approximately HK$262.6 million in financial assets at fair value through other comprehensive income (including equity investments and bonds) and HK$289.8 million in financial assets at fair value through profit or loss (including equity investments, fu