Financial Performance - The company reported a net profit after tax of approximately HK$271.4 million for the year ended December 31, 2020, compared to a net loss of approximately HK$159.7 million in the previous year, marking a significant turnaround [29]. - Interest income from margin financing services increased by 463% to approximately HK$37.5 million, contributing to the overall profit growth [29]. - The newly developed asset management business generated management fee income of approximately HK$5.4 million for the group [29]. - Interest income from the money lending business rose by 159% to approximately HK$14.6 million, further enhancing the company's financial performance [29]. - The company realized net gains from sales of listed equity and debt investments classified as held-for-trading investments amounting to approximately HK$102.3 million, primarily from the disposal of listed securities in October 2020 [29]. - The fair value of financial assets classified as held-for-trading turned from unrealized losses of approximately HK$28.4 million in 2019 to unrealized gains of approximately HK$101 million for the year under review [29]. - The net profit attributable to shareholders for the Year under Review was approximately HK$265.9 million, a turnaround from a net loss of approximately HK$159.5 million in the previous year [75]. - Interest income on margin clients increased from approximately HK$6.7 million to approximately HK$37.5 million [75]. - Interest income on loans receivable rose from approximately HK$5.7 million to approximately HK$14.6 million [75]. - Net realised gains from sales of listed equity investments/debt investments classified as held-for-trading investments amounted to approximately HK$102.3 million, compared to net realised losses of approximately HK$80.3 million last year [75]. Business Development and Strategy - The company continued to focus on developing its core integrated financial services business during the year [29]. - The Company expects the principal core business of integrated financial services to continue expanding and improving in the coming year despite a challenging business environment [41][43]. - The Management plans to further recruit personnel for Imagi Brokerage and enter the mass market as part of its expansion strategy [46][48]. - The Company anticipates that the money lending business will provide consistent and significant returns in the future [47][49]. - The Group has invested approximately HK$20.4 million in a total of six films, with HK$12.1 million already invested in three films, one of which received great reviews after its screening in October 2019 [33][34]. - The Group disposed of part of its listed equity investments for net proceeds of approximately HK$150.7 million, which was reinvested into the development of integrated financial services [40][41]. Market Conditions and Risks - The overall business environment remains difficult, with uncertainties expected to persist in the coming year due to international trade conflicts and the COVID-19 pandemic [46]. - The Hong Kong and global economy were negatively impacted by international factors, including ongoing trade disputes between China and the United States, and the effects of COVID-19, which are expected to persist in the coming year [52][53]. - The Company plans to allocate more resources to its principal business and may further reduce its commitment to securities investments and proprietary trading in the coming year [52][53]. - The Company will continuously review its strategy in the securities investments and proprietary trading segment due to uncertainties in the market [68]. - The Company will continue to monitor exchange rate fluctuations and take necessary measures to minimize adverse impacts [90]. Corporate Governance - The company has complied with the Corporate Governance Code and the code provisions set out in Appendix 14 to the Listing Rules during the Year under Review [129]. - The Board comprises three executive Directors and four independent non-executive Directors, reflecting a balance of skills and experience appropriate for business requirements [132]. - The independent non-executive Directors are identified in all corporate communications whenever the names of Directors are disclosed [135]. - The company recognizes the importance of good corporate governance for enhancing accountability and transparency to stakeholders [128]. - There are no relationships among members of the Board, ensuring independence in decision-making [136]. - The company has adopted the Model Code for Securities Transactions by Directors, with all Directors confirming compliance throughout the Year under Review [130]. - The senior management team has extensive experience in corporate finance and business development, contributing to strategic planning [124]. - The company has a diverse Board with high-caliber executives from various industries, enhancing its governance structure [133]. - The company has maintained a strong focus on operational aspects and strategic planning in its business development efforts [125]. - The company’s governance practices are regularly updated and made available on its website and the Stock Exchange [135]. Financial Position and Ratios - As of December 31, 2020, the Group had bank balances of approximately HK$41 million, down from HK$734 million in 2019 [78]. - The current ratio as of December 31, 2020, was approximately 5.7 times, compared to approximately 112 times in 2019 [78]. - The gearing ratio was zero as of December 31, 2020, down from 196.6% in 2019 [80]. - The total number of issued shares was 829,921,572, with a market value of approximately HK$664 million as of December 31, 2020 [85]. - The net asset value per share as of December 31, 2020, was approximately HK$1.098, compared to HK$0.733 in 2019 [87]. - The total staff cost for the year amounted to approximately HK$14 million, a decrease from approximately HK$19 million in 2019 [92]. - The Group employed 22 employees as of December 31, 2020, down from 37 employees in 2019 [92]. Shareholder and Director Information - The Company did not recommend the payment of a final dividend for the year under review, consistent with 2019 [91]. - In May 2020, the Company repurchased HK$1 billion of guaranteed notes at an average price of approximately HK$1.0226, with no notes outstanding after cancellation [99]. - The Company completed deemed disposals of shares in Imagi Brokerage for a total cash consideration of HK$74.34 million, strengthening its capital base [101]. - The external auditor attended the annual general meeting to address shareholder questions, emphasizing the importance of shareholder feedback [144]. - Directors are encouraged to participate in continuous professional development to keep their knowledge and skills relevant [154]. - Each non-executive Director has a two-year appointment term, with all existing executive Directors having an initial two-year term renewed for three years since 2018 [155]. - Directors appointed to fill casual vacancies must be subject to election by shareholders at the first general meeting after their appointment [156]. Board Committees and Meetings - The Company has established three Board committees: Audit Committee, Nomination Committee, and Remuneration Committee to oversee specific aspects of its affairs [173]. - The Audit Committee held four meetings during the Year under Review and reviewed the Group's financial statements for the year ended 31 December 2019 and interim results for the six months ended 30 June 2020 [181]. - The Audit Committee recommended the re-appointment of external auditors based on their performance, fees, and terms of engagement [181]. - The Nomination Committee is responsible for reviewing the structure, size, and composition of the Board, and monitoring the implementation of the Board Diversity Policy [183]. - The Company has adopted a Board Diversity Policy to ensure a diverse range of skills, experience, and perspectives on the Board since 26 August 2013 [162]. - The Audit Committee is tasked with reviewing the risk management and internal control system of the Group [181]. - The Company has liability insurance for Directors and officers to protect against legal actions, complying with Code Provision A.1.8 of the CG Code [169]. - The roles of chairman and chief executive are separated to ensure effective leadership and management of the Group [170]. - The Nomination Committee assesses candidates for directorships based on qualifications, experience, and commitment to the Company [167]. - The Company Secretary maintains minutes of all meetings and resolutions of the Board committees, which are circulated to members [173]. - The Board is responsible for establishing and maintaining effective risk management and internal control systems, supported by the Audit Committee and independent internal control advisors [199]. - The review of the Company's risk management and internal control systems included financial, operational, and compliance controls, as well as the adequacy of resources in accounting and internal audit functions [200].
元汇集团(00585) - 2020 - 年度财报