Financial Performance - Total revenue for the year ended December 31, 2020, was HKD 70,944,000, a decrease of 49.8% compared to HKD 141,190,000 in 2019[199]. - Gross profit for 2020 was HKD 21,531,000, down 46.5% from HKD 40,231,000 in the previous year[199]. - The company reported a net loss of HKD 5,517,000 for 2020, compared to a loss of HKD 1,324,000 in 2019, representing a significant increase in losses[199]. - Basic and diluted loss per share for 2020 was HKD 0.90, compared to HKD 0.22 in 2019[199]. - Total assets as of December 31, 2020, were HKD 167,606,000, a decrease from HKD 173,118,000 in 2019[200]. - Current liabilities decreased to HKD 91,894,000 in 2020 from HKD 94,354,000 in 2019[200]. - The company's cash and cash equivalents were HKD 21,062,000 at the end of 2020, down from HKD 25,109,000 in 2019[200]. - Non-current assets totaled HKD 37,511,000 in 2020, a slight decrease from HKD 39,625,000 in 2019[200]. - The company reported a foreign exchange gain of HKD 4,173,000 in 2020, compared to a loss of HKD 832,000 in 2019[199]. - The company’s total equity as of December 31, 2020, was HKD 107,750,000, down from HKD 112,632,000 in 2019[200]. Market Conditions - In 2020, revenue from China and Singapore decreased by 54.7% and 38.8% respectively compared to 2019[7]. - Revenue from other countries dropped by 88.5% compared to 2019 due to the impact of the COVID-19 pandemic[7]. - The economic activity in Singapore remains low, with customer demand still subdued, indicating a need for more time for market recovery[12]. - The overall business environment in Hong Kong remains challenging due to the ongoing effects of the COVID-19 pandemic[6]. - The Hong Kong market is expected to regain growth momentum as local pandemic conditions improve and infrastructure project approvals resume[10]. - The business operations in China began to gradually resume from March 2020, but project delays were noted due to economic uncertainties caused by the pandemic[11]. Corporate Governance - The company has adopted the Corporate Governance Code as per the GEM Listing Rules and has complied with it for the year ended December 31, 2020, with some deviations noted[60]. - The board consists of six members, including three executive directors and three independent non-executive directors, responsible for overall strategy and policy formulation[64]. - The company has established various committees, including audit, remuneration, and nomination committees, to ensure effective governance and compliance[50]. - The company has established a corporate governance committee responsible for reviewing and monitoring compliance with legal regulations and corporate governance policies[74]. - The company emphasizes corporate governance, with Mr. Wu Li Bao serving as the compliance officer, ensuring adherence to regulatory standards[48]. - The Audit Committee reviewed the company's financial statements, annual reports, and quarterly reports, ensuring the integrity of financial reporting and risk management[71]. Environmental Impact - The group has established a set of environmental protection management policies and measures to ensure sustainable development and operations[133]. - There were no known violations of environmental laws and regulations in Hong Kong, China, Singapore, and Australia during the reporting period[134]. - The group is committed to enhancing energy and resource efficiency while complying with relevant environmental regulations[133]. - Nitrogen oxide emissions in Hong Kong decreased by 59% from 78,077 grams in 2019 to 31,663 grams in 2020[139]. - Total nitrogen oxide emissions across all regions decreased by 65%, from 98,633 grams in 2019 to 34,980 grams in 2020[139]. - Total greenhouse gas emissions decreased by 2%, from 50,524 kg in 2019 to 49,540 kg in 2020[142]. - Carbon emissions from electricity usage decreased by 2%, from 41 tons in 2019 to 40 tons in 2020[146]. - Water usage decreased by 55%, from 711 cubic meters in 2019 to 323 cubic meters in 2020[152]. - A4 paper consumption decreased by 18%, from 101,389 sheets in 2019 to 83,315 sheets in 2020[154]. - The total particulate matter emissions decreased by 37%, from 5,015 grams in 2019 to 3,156 grams in 2020[141]. Strategic Initiatives - The company is focused on providing specialized cutting tools and components for tunnel construction, with a significant emphasis on tunnel boring machines[9]. - The company is adapting to the "new normal" business environment created by the pandemic, maintaining a cautious yet optimistic outlook[7]. - The company plans to allocate HKD 9.0 million for the purchase of two reverse circulation drilling rigs, expected to be assembled by December 31, 2021, and December 31, 2022, respectively[40]. - An amount of HKD 7.3 million is designated for acquiring three hydraulic vibratory hammers, with completion expected by December 31, 2021, 2022, and 2023[40]. - The company is committed to enhancing its operational efficiency and financial performance through strategic initiatives and regional management[56]. Employee Relations - The company maintains a good relationship with employees, with no significant labor disputes reported[42]. - The total employee cost for the year ended December 31, 2020, was approximately HKD 16.8 million, down from HKD 18.7 million in 2019[42]. - The company has established health and safety policies to minimize potential risks and ensure a safe working environment[162]. - The company provided training opportunities to employees to maintain high competency levels and enhance competitive advantage[164]. - The company has adhered to all relevant labor standards and has not faced any labor disputes during the reporting period[165]. Risk Management - The company faces risks related to competition, reliance on a limited number of suppliers, and potential credit risks from customers[46]. - The board believes that the group's risk management and internal control systems are effective and adequate, although they are designed to manage rather than eliminate risks[77]. - The company has engaged external independent consultants to review its risk management and internal control systems, with major risks recorded in a risk register[76]. - The company has adopted a set of policies and procedures to provide guidance on internal control and risk management compliance across various operational and management functions[76]. Shareholder Information - The company did not recommend the payment of a final dividend for the year ended December 31, 2020[89]. - The group recognized a trade receivables impairment provision of HKD 5,078,000 as of December 31, 2020, against a pre-impairment trade receivables balance of HKD 104,086,000[186]. - The group’s top five customers accounted for approximately 71.9% of total revenue for the year ended December 31, 2020, compared to 68.9% in 2019[118]. - The largest single customer represented 18.9% of total revenue for the year ended December 31, 2020, down from 25.0% in 2019[118]. - The group’s top five suppliers accounted for 95.5% of total procurement for the year ended December 31, 2020, slightly up from 95.3% in 2019[118].
明梁控股(08152) - 2020 - 年度财报