Company Information Financial Highlights Financial Highlights This fiscal year saw slight revenue growth, but profit before tax and profit for the year declined, with operating cash flow turning negative, while current assets and net assets remained stable and the gearing ratio remained very low Selected Consolidated Statement of Profit or Loss Items (FY2023/24 vs FY2022/23) | Indicator | FY2024 (HK$'000) | FY2023 (HK$'000) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 401,994 | 392,496 | +2.4% | | Profit Before Tax | 17,065 | 21,425 | -20.3% | | Profit and Total Comprehensive Income for the Year | 13,658 | 17,645 | -22.6% | Selected Consolidated Statement of Financial Position Items (as at March 31) | Indicator | 2024 (HK$'000) | 2023 (HK$'000) | | :--- | :--- | :--- | | Non-current Assets | 13,165 | 10,654 | | Current Assets | 241,577 | 235,357 | | Current Liabilities | 44,260 | 38,809 | | Net Assets / Total Equity | 208,865 | 207,202 | Selected Consolidated Statement of Cash Flows Items | Indicator | FY2024 (HK$'000) | FY2023 (HK$'000) | | :--- | :--- | :--- | | Net Cash (Used in) From Operating Activities | (30,035) | 45,474 | | Net Cash (Used in) From Investing Activities | (17,826) | 2,250 | | Net Cash Used in Financing Activities | (13,688) | (44,611) | | Cash and Cash Equivalents at Year End | 58,631 | 120,180 | Key Financial Ratios | Indicator | FY2024 | FY2023 | | :--- | :--- | :--- | | Adjusted Net Profit Margin (%) | 3.4 | 3.8 | | Gearing Ratio (%) | 1.4 | 0.2 | | Current Ratio (times) | 5.5 | 6.1 | | Average Trade Receivables Turnover Days (days) | 119 | 119 | Chairman's Statement Chairman's Statement The Chairman's Statement highlights a 2.4% revenue growth in FY2024, primarily from security services, despite a 22.6% decline in profit for the year, with a proposed final dividend of 1.20 HK cents per share and future focus on service expansion and strategic acquisitions - In FY2024, the Group's revenue was approximately HK$402.0 million, a 2.4% year-on-year increase, while profit for the year was approximately HK$13.7 million, a 22.6% year-on-year decrease486 - The Board recommended a final dividend of 1.20 HK cents per ordinary share for FY2024, totaling approximately HK$9.6 million453 - The Group will focus on expanding security services, enhancing facility management capabilities, improving operational efficiency, and seeking strategic acquisition and investment opportunities in the future454 Management Discussion and Analysis Business Review and Financial Overview The Group, a Hong Kong facility services provider, achieved 2.4% revenue growth to HK$402.0 million in FY2024, primarily from security services, but profit for the year declined 22.6% to HK$13.7 million due to increased employee benefits and reduced COVID-related cost savings, lowering the adjusted net profit margin Revenue Performance by Business Segment (HK$'000) | Business Segment | FY2024 | FY2023 | Growth Rate | | :--- | :--- | :--- | :--- | | Security Services | 377,000 | 368,300 | +2.4% | | Facility Management Services | 25,000 | 24,200 | +3.2% | | Total | 402,000 | 392,500 | +2.4% | - Employee benefits expenses increased by 10.4% year-on-year to HK$360.7 million, primarily due to increased headcount following the reopening of the Hong Kong-Mainland China border and new service contracts494 - Subcontracting costs significantly decreased by 72.5% year-on-year to HK$8.1 million, mainly because COVID-19 related expenses were no longer incurred498 - Profit for the year decreased by 22.6% to HK$13.7 million, with the net profit margin falling from 4.5% to 3.4%; excluding government subsidies, the adjusted net profit margin decreased from 3.8% to 3.4%501 Liquidity, Financial Resources and Capital Structure The Group primarily funds operations through internal cash generation, with bank balances, cash, and pledged bank deposits totaling approximately HK$73.6 million as of March 31, 2024, a 38.7% decrease, yet maintaining a strong financial position with a 5.5x current ratio and 1.4% gearing ratio, and low foreign exchange risk Key Financial Position Indicators (as at March 31) | Indicator | 2024 | 2023 | | :--- | :--- | :--- | | Bank Balances, Cash and Pledged Bank Deposits (HK$M) | 73.6 | 120.2 | | Net Current Assets (HK$M) | 197.3 | 196.5 | | Gearing Ratio (%) | 1.4 | 0.2 | | Current Ratio (times) | 5.5 | 6.1 | - The Group has bank facilities with a limit of HK$95.0 million, of which HK$56.7 million has been utilized505 - The Group faces credit concentration risk, with over 80% of trade receivables from Hong Kong public sector clients or projects, where directors deem the irrecoverable risk low; the largest client and top five clients account for 60% and over 90% of trade receivables, respectively507601 Future Strategies and Use of Proceeds from Listing The Group expects continued growth in Hong Kong's security and facility management markets, focusing on client expansion and cost control; of the HK$32.0 million net proceeds from the 2019 GEM listing, HK$25.7 million has been utilized, with the remaining HK$6.3 million for equipment and IT upgrades deferred until March 31, 2025 - Management anticipates the Hong Kong security services market to grow at a CAGR of approximately 7.7% between 2021 and 2025, with the facility and venue management services market growing at a CAGR of approximately 5.3% during the same period, presenting growth opportunities for the Group553556 Summary of Use of Proceeds from GEM Listing (as at March 31, 2024) | Purpose | Actual Net Proceeds (HK$'000) | Amount Utilized (HK$'000) | Unutilized Amount (HK$'000) | | :--- | :--- | :--- | :--- | | Expansion of Security Services Business | 14,200 | 14,200 | - | | Enhancement of Facility Management Services Capabilities | 5,100 | 1,000 | 4,100 | | Improvement of Operational Efficiency and Scalability | 5,000 | 2,832 | 2,168 | | Repayment of Bank Loans | 4,500 | 4,500 | - | | General Working Capital | 3,200 | 3,200 | - | | Total | 32,000 | 25,732 | 6,268 | - The Directors decided to defer the utilization of the unutilized HK$6.268 million (primarily for purchasing machinery and equipment and IT upgrades) by 12 months, with full utilization expected by March 31, 2025386 Directors and Senior Management Directors and Senior Management This section details the biographies of the company's executive directors, independent non-executive directors, and senior management, outlining their roles in overall strategy, independent oversight, and daily operational management within the security and property management sectors - The Executive Board comprises Mr. Ma Kiu Sang (Chairman), Mr. Ma Kiu Mo, Mr. Ma Kiu Man, and Mr. Ma Yung King, primarily responsible for the Group's overall corporate and business strategy formulation389394395399 - Independent Non-executive Directors include Dr. Ng Ka Sing, Ms. Cheng Wai Ha, and Mr. Yau Siu Yeung, who possess professional backgrounds in policing, accounting, and law, respectively401348349 - Senior management includes Mr. Choi Ming Fai (Chief Executive Officer) and Mr. Kwong Tat Man (General Manager), among others, who possess over 20 years of extensive experience in the security and property management industries353355 Corporate Governance Report Corporate Governance Practices and the Board The company complies with all Corporate Governance Code provisions; its seven-member Board, with separate Chairman and CEO roles, ensures power balance and oversees strategy, while daily operations are managed by senior executives, and a board diversity policy is in place, aiming to enhance gender representation - For the year ended March 31, 2024, the company has complied with all applicable code provisions of the Corporate Governance Code30 - The Board comprises seven members: four executive directors (Ma Kiu Sang, Ma Kiu Mo, Ma Kiu Man, Ma Yung King) and three independent non-executive directors (Ng Ka Sing, Cheng Wai Ha, Yau Siu Yeung)32 - The roles of Chairman (Mr. Ma Kiu Sang) and Chief Executive Officer (Mr. Choi Ming Fai) are separate, ensuring a balance of power and authority36 - The company has adopted a Board Diversity Policy, aiming to appoint at least 20% female members within three years after its transfer of listing4445 Board Committees The Board has four committees—Audit, Remuneration, Nomination, and Risk Management—all chaired by independent non-executive directors, overseeing financial reporting, internal controls, remuneration policies, board structure, director nominations, and the risk management framework - The Audit Committee comprises three independent non-executive directors, chaired by Ms. Cheng Wai Ha, and held four meetings during the year to review annual, interim, and quarterly results8586 - The Remuneration Committee comprises three independent non-executive directors, chaired by Mr. Yau Siu Yeung, and reviewed the performance and remuneration packages of executive directors during the year8990 - The Nomination Committee comprises one executive director and three independent non-executive directors, chaired by Mr. Yau Siu Yeung, and held one meeting during the year to review the Board's structure and composition9397 - The Risk Management Committee comprises two executive directors and three independent non-executive directors, chaired by Dr. Ng Ka Sing, and held one meeting during the year to continuously monitor the Group's risk management and internal control systems130131 Risk Management and Internal Control The Board is responsible for maintaining effective risk management and internal control systems, concluding their effectiveness based on independent reviews; while lacking an internal audit function, these duties are fulfilled through external consultants and Board oversight, and the company has whistleblowing and anti-corruption policies, with no significant corruption litigation - The Board bears overall responsibility for risk management and internal control, deeming the relevant procedures effective and adequate for the year ended March 31, 2024141143 - The Group has engaged an independent professional firm to review the effectiveness of its internal control measures, with the Audit Committee and Risk Management Committee having reviewed the relevant reports142 - The Group currently does not have an internal audit function, but this function is fulfilled through external consultants and formal Board policies136 - The Group has established an anti-corruption policy, with seven Board members and the company secretary attending 8 hours of internal anti-corruption training during the year, and no related legal proceedings137138 Directors' Report Principal Activities, Results and Dividends The Group's principal activities in Hong Kong, security and facility management services, saw no significant changes during the year; the Board recommends a final dividend of 1.20 HK cents per share for the year ended March 31, 2024, subject to shareholder approval - The Group's principal activities are providing security and facility management services in Hong Kong, with no significant changes during the year198 Proposed Final Dividend | Fiscal Year | Dividend Per Share (HK cents) | Remarks | | :--- | :--- | :--- | | As at March 31, 2024 | 1.20 | Proposed, subject to shareholder approval | | As at March 31, 2023 | 1.50 | Paid | Continuing Connected Transactions The Group has a new master service agreement with Ma family-controlled companies for security and facility management services, constituting continuing connected transactions; for FY2024, these transactions totaled approximately HK$19.7 million, below the HK$31.5 million annual cap, confirmed fair and compliant by independent non-executive directors and auditors - The Group entered into a new master service agreement with Ma family-controlled companies to provide security and facility management services, effective until March 31, 2025215 Continuing Connected Transaction Amounts (HK$'000) | Fiscal Year | Annual Cap | Actual Transaction Amount | | :--- | :--- | :--- | | 2024 | 31,500 | 19,700 | | 2023 | 28,000 | 20,000 | - Both independent non-executive directors and the company's auditor have reviewed these transactions, confirming they are on normal commercial terms, fair and reasonable, and in the overall interests of shareholders252254 Major Customers and Risks The Group faces significant customer concentration risk, with its top five clients accounting for 81.0% of total revenue and the largest client for 44.5%; key risks include reliance on railway and Hong Kong government contracts, regulatory changes, and impacts from Hong Kong's economic and political environment, with no significant post-year-end events identified - For the year ended March 31, 2024, the Group's top five clients accounted for 81.0% of total revenue (2023: 73.0%), with the largest client contributing 44.5% (2023: 32.1%) of total revenue256 - Key business risks include reliance on significant contracts from railway companies and the Hong Kong Government, potential impacts from changes in industry regulations, and shifts in Hong Kong's local economic, social, and political environment262263264 Disclosure of Interests As of March 31, 2024, Executive Directors Mr. Ma Kiu Sang, Mr. Ma Kiu Mo, and Mr. Ma Kiu Man are deemed to collectively hold 560,000,000 shares (70.0% of issued capital) through IWS Group Holdings Limited (BVI) due to their acting-in-concert relationship; interests of substantial shareholders and other persons are also disclosed Directors' Interests in the Company's Shares | Name of Director | Nature of Interest | Number of Ordinary Shares | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Ma Kiu Sang | Interest in Controlled Corporation and Acting in Concert | 560,000,000 | 70.0% | | Mr. Ma Kiu Mo | Interest in Controlled Corporation and Acting in Concert | 560,000,000 | 70.0% | | Mr. Ma Kiu Man | Interest in Controlled Corporation and Acting in Concert | 560,000,000 | 70.0% | - IWS Group Holdings Limited (BVI), as beneficial owner, holds 560,000,000 shares in the company, representing 70.0%324 - The company adopted a share option scheme on September 20, 2019, but no share options have been granted under the scheme as of March 31, 2024361362 Environmental, Social and Governance Report ESG Report Framework and Governance This ESG report, prepared according to the HKEX ESG Reporting Guide, covers the Group's core Hong Kong operations; the Board oversees ESG strategy, risk assessment, and reporting, identifying key issues like operational compliance, customer privacy, and occupational health and safety through materiality assessment - The report is prepared in accordance with the Main Board ESG Reporting Guide of the Stock Exchange and has complied with the "comply or explain" provisions459 - The Board oversees the Group's ESG matters and has identified material issues important to its business and stakeholders through a materiality assessment, including operational compliance, customer privacy protection, and occupational health and safety467479 Environmental Protection The Group is committed to environmental sustainability, complying with regulations; its main emissions are from vehicles and office electricity, managed through maintenance, energy-saving measures, and reduced paper consumption; the Group holds ISO 14001:2015 certification and has measures for climate-related risks like extreme weather - The Group has obtained ISO 14001:2015 Environmental Management System certification, demonstrating its commitment to environmental management517 Key Environmental Performance Indicators (FY2023/24) | Indicator | Value | | :--- | :--- | | Total Greenhouse Gas Emissions (tonnes of CO2e) | 90 | | Total Energy Consumption (MWh) | 184 | | Total Non-hazardous Waste Generated (kg) | 3,754 | - The Group has established work arrangements to address extreme weather conditions such as typhoons and heavy rain, mitigating climate-related risks518 Social Responsibility The Group views employees as core assets, adhering to labor laws, offering equal opportunities, and prohibiting child/forced labor, providing competitive compensation and a safe work environment; it reported 20 work injuries and 184 lost days this year, holds ISO 9001:2008 certification for service quality, and strictly complies with anti-corruption laws and client privacy protection - The Group strictly complies with labor laws such as the Employment Ordinance, implements a non-discrimination policy, and prevents child labor through identity verification520521 Employment and Work Injury Data | Indicator | 2023/24 | 2022/23 | | :--- | :--- | :--- | | Total Employees | 2,631 | 2,964 | | Employee Turnover Rate (Hong Kong) | 48% | 25% | | Number of Work Injuries | 20 | 18 | | Lost Days Due to Work Injuries | 184 | 301 | - The Group has obtained ISO 9001:2008 Quality Management System certification and provides various channels, including a 24-hour hotline, for handling customer feedback and complaints535537 - The Group has established an anti-corruption policy, providing 8 hours of internal anti-corruption training to directors and the company secretary, with no related litigation during the year511588 Independent Auditor's Report Independent Auditor's Report Deloitte Touche Tohmatsu issued an unqualified opinion on IWS Group Holdings Limited's consolidated financial statements, affirming they present a true and fair view of the Group's financial position and performance, prepared in accordance with HKFRS and the Hong Kong Companies Ordinance; "Revenue recognition for security services provided" was identified as a key audit matter - The auditor believes the consolidated financial statements present a true and fair view of the Group's financial position, performance, and cash flows in accordance with Hong Kong Financial Reporting Standards1 - The key audit matter identified is "Revenue recognition for security services provided," given its significant financial impact on the consolidated financial statements, accounting for approximately 94% of total revenue6 - The auditor performed multiple procedures for this key matter, including understanding business processes, testing key controls, sampling revenue documents, and conducting analytical reviews of revenue from major client contracts6 Consolidated Financial Statements Consolidated Statement of Profit or Loss and Other Comprehensive Income For the year ended March 31, 2024, the Group's revenue increased by 2.4% to HK$401,994 thousand, but profit before tax decreased from HK$21,425 thousand to HK$17,065 thousand, and profit and total comprehensive income for the year declined from HK$17,645 thousand to HK$13,658 thousand, with basic earnings per share at 1.71 HK cents Summary of Consolidated Statement of Profit or Loss and Other Comprehensive Income (HK$'000) | Item | 2024 | 2023 | | :--- | :--- | :--- | | Revenue | 401,994 | 392,496 | | Employee Benefits Expenses | (360,680) | (326,559) | | Subcontracting Costs | (8,055) | (29,301) | | Profit Before Tax | 17,065 | 21,425 | | Income Tax Expense | (3,407) | (3,780) | | Profit and Total Comprehensive Income for the Year | 13,658 | 17,645 | | Profit Attributable to Owners of the Company | 13,663 | 17,645 | | Basic Earnings Per Share (HK cents) | 1.71 | 2.21 | Consolidated Statement of Financial Position As of March 31, 2024, the Group's total assets were HK$254,742 thousand, total liabilities HK$45,877 thousand, and net assets HK$208,865 thousand, largely stable; net current assets of HK$197,317 thousand indicate strong short-term solvency, with major assets being trade and other receivables and bank balances and cash Summary of Consolidated Statement of Financial Position (as at March 31, HK$'000) | Item | 2024 | 2023 | | :--- | :--- | :--- | | Assets | | | | Non-current Assets | 13,165 | 10,654 | | Current Assets | 241,577 | 235,357 | | Total Assets | 254,742 | 246,011 | | Liabilities and Equity | | | | Current Liabilities | 44,260 | 38,809 | | Non-current Liabilities | 1,617 | 0 | | Total Liabilities | 45,877 | 38,809 | | Net Assets | 208,865 | 207,202 | | Total Equity | 208,865 | 207,202 | Consolidated Statement of Cash Flows For the year ended March 31, 2024, the Group's operating activities resulted in a net cash outflow of HK$30,035 thousand, a contrast to last year's inflow, primarily due to increased trade and other receivables; investing activities had a net outflow of HK$17,826 thousand, and financing activities a net outflow of HK$13,688 thousand, leading to a net decrease in cash and cash equivalents of HK$61,549 thousand Summary of Consolidated Statement of Cash Flows (HK$'000) | Item | 2024 | 2023 | | :--- | :--- | :--- | | Net Cash From (Used in) Operating Activities | (30,035) | 45,474 | | Net Cash From (Used in) Investing Activities | (17,826) | 2,250 | | Net Cash Used in Financing Activities | (13,688) | (44,611) | | Net (Decrease) Increase in Cash and Cash Equivalents | (61,549) | 3,113 | | Cash and Cash Equivalents at Beginning of Year | 120,180 | 117,067 | | Cash and Cash Equivalents at End of Year | 58,631 | 120,180 | Notes to the Consolidated Financial Statements The notes to the financial statements detail accounting policies, revenue segments, related party transactions, and financial instrument risks; the Group's primary revenue is from security services (94% of total), with high customer concentration where two major clients contribute over 75% of revenue; related party transactions involve services to Ma family-controlled companies, and credit concentration risk is deemed controllable Note 4. Revenue and Segment Information This year's total revenue was HK$401,994 thousand, with security services contributing HK$377,009 thousand (93.8%) and facility management services HK$24,985 thousand; all Group operations are in Hong Kong, with very high customer concentration, as clients A and B (Hong Kong government departments and bureaux) collectively accounted for 78.8% of total revenue Revenue by Service Type (HK$'000) | Service Type | 2024 | 2023 | | :--- | :--- | :--- | | General Manned Guarding Services | 180,240 | 204,424 | | Manpower Support Services | 196,552 | 163,644 | | Property Management Services | 17,804 | 18,210 | | Other Services | 7,398 | 6,218 | | Total | 401,994 | 392,496 | Revenue from Major Customers (HK$'000) | Client | 2024 | 2023 | Percentage of Total Revenue (2024) | | :--- | :--- | :--- | :--- | | Client A¹ | 178,882 | 125,825 | 44.5% | | Client B² | 137,927 | 165,528 | 34.3% | Note 15. Trade and Other Receivables and Deposits As of March 31, 2024, net trade receivables were HK$79,985 thousand and unbilled revenue HK$78,330 thousand, with client credit terms of 30 to 120 days; a significant portion of receivables are over 120 days (HK$25,808 thousand), but management considers default risk low due to public sector clients Aging Analysis of Trade Receivables (Net, HK$'000) | Aging | 2024 | | :--- | :--- | | 0 to 30 Days | 32,487 | | 31 to 60 Days | 9,495 | | 61 to 90 Days | 7,108 | | 91 to 120 Days | 5,087 | | Over 120 Days | 25,808 | | Total | 79,985 | - As of the reporting date, trade receivables totaling HK$45,627 thousand were overdue, with HK$23,579 thousand overdue for over 90 days, but management believes no default is required to be recognized666 Note 24. Related Party Disclosures This year, the Group engaged in multiple transactions with related parties, primarily companies controlled by the Ma family; revenue from security and facility management services, constituting continuing connected transactions, totaled approximately HK$19.7 million, and key management personnel compensation amounted to HK$9,840 thousand - Revenue from providing security and facility management services to Ma family-controlled companies totaled approximately HK$19.7 million (2023: approximately HK$20.0 million), constituting continuing connected transactions707251 Key Management Personnel Compensation (HK$'000) | Item | 2024 | 2023 | | :--- | :--- | :--- | | Short-term Employee Benefits | 9,738 | 10,093 | | Post-employment Benefits | 102 | 123 | | Total | 9,840 | 10,216 | Note 26. Financial Instruments The Group faces primary financial risks including credit, liquidity, and market risks; credit risk is highly concentrated, with the largest client accounting for 60% of total trade receivables and unbilled revenue, and the top five clients for 91%, though management deems credit risk significantly reduced due to public sector clients; liquidity risk is managed by monitoring cash levels, and interest rate risk is not significant - The Group faces concentrated credit risk, with receivables from the largest client accounting for 60% of total trade receivables and unbilled revenue, and the top five clients accounting for 91%601 - The Group manages liquidity risk by monitoring its levels of cash and cash equivalents606 Financial Summary Five-Year Financial Summary This section provides key financial data for the Group's past five fiscal years (2020-2024); FY2024 revenue (HK$401,994 thousand) and profit for the year (HK$13,658 thousand) were below 2022 peaks but higher than some prior years, with total assets and total equity showing steady growth Five-Year Financial Performance Summary (HK$'000) | Fiscal Year | 2024 | 2023 | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 401,994 | 392,496 | 537,371 | 365,833 | 481,571 | | Profit Before Tax | 17,065 | 21,425 | 71,783 | 72,806 | 60,118 | | Profit for the Year | 13,658 | 17,645 | 56,569 | 66,212 | 47,088 | Five-Year Assets, Liabilities and Equity Summary (HK$'000) | Fiscal Year | 2024 | 2023 | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 254,742 | 246,011 | 292,907 | 251,719 | 210,158 | | Total Liabilities | (45,877) | (38,809) | (60,150) | (49,531) | (58,182) | | Total Equity | 208,865 | 207,202 | 232,757 | 202,188 | 151,976 |
国际永胜集团(06663) - 2024 - 年度财报