Financial Performance - The company reported a revenue of HKD 24,423,000 for the year ended December 31, 2020, a decrease of 41.4% from HKD 41,732,000 in 2019[8]. - The net loss attributable to ordinary shareholders for the year was HKD 6,576,000, compared to a loss of HKD 18,505,000 in 2019, indicating an improvement in performance[8]. - The adjusted EBITDA for the year was a profit of HKD 1,575,000, down from HKD 7,514,000 in 2019[10]. - The net cash flow from operating activities was HKD 18,776,000, an increase from HKD 12,538,000 in 2019[11]. - The total liabilities, including borrowings, amounted to HKD 79,316,000, compared to HKD 72,927,000 in 2019[12]. - The total employee cost for the year was HKD 7,574,000, a decrease of 14.14% from HKD 8,825,000 in the previous year[45]. - The company has not declared any dividends for the year ended December 31, 2020[106]. Cash and Assets - As of December 31, 2020, the company's cash and bank balances were HKD 86,407,000, up from HKD 77,268,000 in 2019[12]. - The capital to asset ratio remained stable at 0.02, indicating a low level of financial leverage[13]. - The company holds two investment properties in China, with a total book value of HKD 4,415,971,000 as of December 31, 2020[16]. - The fair value of the group's investment properties was HKD 4,415,971,000, representing 96.8% of the total assets[193]. Business Strategy and Future Plans - The company plans to focus on revenue growth in 2021 following the closure of its wholesale center in Guangzhou in 2019[8]. - The company is conducting preliminary feasibility studies on new policies encouraging the conversion of commercial areas to residential use, which could significantly enhance investment returns[32]. - The group plans to leverage its strong asset base and low debt levels to finance reconstruction projects in Guangzhou and explore new business opportunities in 2021 and 2022[43]. - The group is actively exploring other income sources and new business projects in Guangzhou to compensate for the revenue loss due to the closure of the wholesale market in 2019[44]. Development Projects - The Guangzhou development project is planned to be a 22-story multifunctional commercial complex with a total construction area of approximately 234,000 square meters[31]. - The estimated construction cost for the Guangzhou project is approximately RMB 1.7 billion (HKD 2.02 billion), with the company and the seller bearing 25% and 75% of the total cost, respectively[33]. - The first phase of the Guangzhou project is expected to be completed by the end of 2023, and the second phase by the end of 2025, with the new commercial complex anticipated to open in 2024[32]. - The group anticipates that the new commercial complex in Guangzhou will generate rental income and capital appreciation once completed[36]. Share Issuance and Financing - The company issued a subscription agreement for 108,000,000 new shares at HKD 0.15 each, representing approximately 17.8% of the issued share capital at the time of the agreement[18]. - The company completed the issuance of 108,000,000 new shares at a price of HKD 0.15 per share, raising a total of HKD 16,200,000, with a net amount of approximately HKD 16,100,000 after costs[20]. - Of the net proceeds, HKD 12,000,000 is allocated for the reconstruction costs of the Guangzhou development project, while approximately HKD 4,100,000 is intended for general working capital[21]. Legal and Compliance Issues - The company has faced challenges regarding a so-called "liquidation application," which lacks proper legal documentation[57]. - The so-called liquidation petition does not comply with Chinese legal regulations and judicial procedures[63]. - The company has not received any formal judgment or notice from the Guangzhou Intermediate Court regarding the appeal since October 15, 2009[91]. - The company has not taken further action regarding the liquidation petition until receiving formal legal notifications from Chinese courts[78]. Corporate Governance - The board of directors consists of both executive and independent non-executive members, with all non-executive directors eligible for re-election at the annual general meeting[114]. - The company has adhered to the corporate governance code throughout the year, with minor deviations noted[141]. - The remuneration committee is responsible for determining the remuneration policies for directors and senior management, reviewing compensation based on performance[159]. - The internal control system is reviewed at least once a year by the audit committee to ensure its effectiveness in managing operational risks[162]. Employee Relations and Community Engagement - The company maintains a close relationship with employees, providing a fair and safe working environment along with training and development resources[136]. - The management has implemented strict health control rules and work-from-home policies during the COVID-19 pandemic, ensuring employee safety[172]. - The company has been involved in community service through donations, sponsorships, and volunteer activities, particularly during national celebrations[179]. - Employees in Hong Kong actively participate in volunteer services, supported by management through matching donations[179]. Environmental and Social Responsibility - The group has replaced most fluorescent and incandescent bulbs with LED lights and energy-efficient fixtures in its investment properties[169]. - The management is interested in using new energy-saving or environmentally friendly building materials, provided the costs are reasonable[169]. - The company has complied with all relevant environmental laws and regulations impacting its operations during the review year[134]. Audit and Financial Reporting - The independent auditor's report confirms that the financial statements reflect the company's financial position accurately as of December 31, 2020[186]. - The financial statements were prepared in accordance with Hong Kong Financial Reporting Standards, ensuring compliance with local regulations[186]. - The board of directors is responsible for preparing true and fair financial statements in accordance with the Hong Kong Financial Reporting Standards[198].
中华国际(01064) - 2020 - 年度财报