立基工程控股(01690) - 2019 - 中期财报

Interim Results Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2019, the Group transitioned from profit to loss, primarily due to a significant decrease in revenue and the incurrence of a gross loss, resulting in a loss of HKD 17,186 thousand for the period, compared to a profit of HKD 16,765 thousand in the prior year period Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Indicator | 2019 (HKD thousands) | 2018 (HKD thousands) | | :--- | :--- | :--- | | Revenue | 89,872 | 149,451 | | Cost of Sales | (98,504) | (120,948) | | Gross (Loss) Profit | (8,632) | 28,503 | | Other Income | 836 | 603 | | Administrative Expenses | (9,297) | (8,807) | | Finance Costs | (93) | (180) | | (Loss) Profit Before Tax | (17,186) | 20,119 | | Income Tax Expense | - | (3,354) | | Total (Loss) Profit and Comprehensive (Loss) Income for the Period | (17,186) | 16,765 | | Basic (Loss) Earnings Per Share (HK cents) | (1.33) | 1.31 | - Revenue for the period significantly decreased by 39.9% year-on-year, from HKD 149,451 thousand to HKD 89,872 thousand[3] - The company shifted from a gross profit of HKD 28,503 thousand in the prior year period to a gross loss of HKD 8,632 thousand in the current period[3] Unaudited Condensed Consolidated Statement of Financial Position As of June 30, 2019, the Group's total assets and total liabilities both decreased, with a corresponding reduction in net current assets and net assets, but the current ratio improved Condensed Consolidated Statement of Financial Position (As of June 30, 2019) | Indicator | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | Non-current Assets | 9,286 | 2,363 | | Current Assets | 181,927 | 221,324 | | Current Liabilities | 62,642 | 85,395 | | Net Current Assets | 119,285 | 135,929 | | Total Assets Less Current Liabilities | 128,571 | 138,292 | | Non-current Liabilities | 199 | 199 | | Net Assets | 128,372 | 138,093 | | Share Capital | 13,300 | 12,800 | | Reserves | 115,072 | 125,293 | | Total | 128,372 | 138,093 | - Non-current assets significantly increased, primarily due to the acquisition of investment properties[6][48] - Net current assets decreased from HKD 135,929 thousand as of December 31, 2018, to HKD 119,285 thousand as of June 30, 2019[9] Unaudited Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2019, the Group's total equity changed due to the loss for the period and the issuance of new shares, with share capital increasing by HKD 500 thousand and share premium by HKD 7,250 thousand Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30, 2019) | Indicator | Share Capital (HKD thousands) | Share Premium (HKD thousands) | Merger Reserve (HKD thousands) | Retained Earnings (HKD thousands) | Total (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | | As at January 1, 2019 (Audited) | 12,800 | 30,855 | 610 | 93,828 | 138,093 | | Issue of Shares | 500 | 7,250 | - | - | 7,750 | | Expenses Arising from Issue of New Shares | - | (285) | - | - | (285) | | Loss and Total Comprehensive Loss for the Period | - | - | - | (17,186) | (17,186) | | As at June 30, 2019 (Unaudited) | 13,300 | 37,820 | 610 | 76,642 | 128,372 | - The issuance of shares resulted in an increase in share capital of HKD 500 thousand and share premium of HKD 7,250 thousand, totaling HKD 7,750 thousand[14] - A loss of HKD 17,186 thousand was recorded for the period, leading to a decrease in retained earnings[14] Unaudited Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2019, the Group generated net cash from operating activities, with cash inflows also from investing and financing activities, leading to an increase in cash and cash equivalents at the end of the period Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Indicator | 2019 (HKD thousands) | 2018 (HKD thousands) | | :--- | :--- | :--- | | Net Cash From (Used In) Operating Activities | 9,975 | (979) | | Net Cash Used In Investing Activities | (979) | (1,093) | | Net Cash From Financing Activities | 442 | 10,000 | | Net Increase (Decrease) In Cash and Cash Equivalents | 9,438 | 7,928 | | Cash and Cash Equivalents at Beginning of Period | 28,269 | 32,443 | | Cash and Cash Equivalents at End of Period | 37,707 | 32,371 | - Net cash from operating activities significantly improved, changing from net cash used of HKD 979 thousand in the prior year period to net cash generated of HKD 9,975 thousand in 2019[19] - Cash and cash equivalents at the end of the period increased to HKD 37,707 thousand, up from HKD 28,269 thousand at the beginning of the period[19] Notes to the Unaudited Condensed Consolidated Financial Statements 1. General Information The Company was incorporated in the Cayman Islands in 2015, primarily engaged in investment holding, with the Group's main business being the provision of engineering services for building services systems in Hong Kong, and its shares were transferred from GEM to the Main Board of the Stock Exchange on February 12, 2018 - The Company was incorporated in the Cayman Islands on April 29, 2015, and its principal business is investment holding[21] - The Group's principal business is to provide various engineering services for building services systems in Hong Kong[24] - The Company's shares were transferred from GEM to the Main Board of the Stock Exchange with effect from February 12, 2018[23] 2. Basis of Preparation The interim financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" and the Listing Rules, presented under the historical cost convention and in Hong Kong dollars, with the adoption of HKFRS 16 "Leases" having no significant impact on financial position and performance - The interim financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the Listing Rules[25] - The Group first adopted new and revised Hong Kong Financial Reporting Standards, including HKFRS 16 "Leases", but the adoption of HKFRS 16 did not have a significant impact on the Group's financial position and performance[28][29] 3. Revenue and Segment Information The Group's revenue primarily derives from building services engineering and maintenance, repair, and other services, with building services engineering revenue significantly decreasing for the six months ended June 30, 2019, leading to a reduction in total revenue and a shift from segment profit to segment loss - The Group's operating segments include building services engineering (providing ventilation, air-conditioning, electrical, water supply, drainage, and fire services system engineering) and maintenance, repair, and other services[32] Analysis of Revenue and Results by Business Segment (For the six months ended June 30) | Segment | 2019 Revenue (HKD thousands) | 2018 Revenue (HKD thousands) | 2019 Segment Results (HKD thousands) | 2018 Segment Results (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Building Services Engineering | 80,891 | 143,167 | (9,703) | 27,819 | | Maintenance, Repair and Other Services | 8,981 | 6,284 | 1,071 | 684 | | Total | 89,872 | 149,451 | (8,632) | 28,503 | - Building services engineering revenue decreased by 43.5% year-on-year, from HKD 143,167 thousand to HKD 80,891 thousand, causing this segment to shift from profit to loss[33][36] - Revenue from maintenance, repair, and other services increased by 43% year-on-year, from HKD 6,284 thousand to HKD 8,981 thousand, with improved segment results[33][36] 4. (Loss) Profit Before Tax For the six months ended June 30, 2019, the Group shifted from profit to loss before tax, primarily influenced by factors such as staff costs, auditor's remuneration, and depreciation Components of (Loss) Profit Before Tax (For the six months ended June 30) | Item | 2019 (HKD thousands) | 2018 (HKD thousands) | | :--- | :--- | :--- | | Directors' Remuneration | 1,794 | 1,743 | | Total Staff Costs | 19,489 | 20,168 | | Auditor's Remuneration | 400 | 549 | | Depreciation of Property, Plant and Equipment | 263 | 305 | | Bank Interest Income | (31) | (21) | - Total staff costs slightly decreased, but directors' remuneration slightly increased[37] 5. Income Tax Expense Due to the loss incurred, the Group's income tax expense for the six months ended June 30, 2019, was zero, compared to HKD 3,354 thousand in the prior year period Income Tax Expense (For the six months ended June 30) | Item | 2019 (HKD thousands) | 2018 (HKD thousands) | | :--- | :--- | :--- | | Hong Kong Profits Tax | - | 3,354 | - Income tax expense for the current period was zero, primarily due to no assessable profit[42][113] 6. Dividends The Board of Directors resolved not to declare an interim dividend for the six months ended June 30, 2019, whereas a final dividend of HKD 9,984 thousand was distributed in the prior year period - The Board of Directors resolved not to declare an interim dividend for the six months ended June 30, 2019[43][163] - For the six months ended June 30, 2018, the Company declared a final dividend of HKD 9,984,000 (HKD 0.78 cents per share) for the year ended December 31, 2017[43] 7. (Loss) Earnings Per Share For the six months ended June 30, 2019, the Group's basic loss per share was 1.33 HK cents, compared to basic earnings per share of 1.31 HK cents in the prior year period, primarily due to the loss incurred during the period (Loss) Earnings Per Share (For the six months ended June 30) | Indicator | 2019 (HKD thousands) | 2018 (HKD thousands) | | :--- | :--- | :--- | | (Loss) Profit | (17,186) | 16,765 | | Weighted Average Number of Ordinary Shares (thousands) | 1,291,173 | 1,280,000 | | Basic (Loss) Earnings Per Share (HK cents) | (1.33) | 1.31 | - Due to the loss incurred during the period, basic earnings per share shifted from 1.31 HK cents last year to a basic loss per share of 1.33 HK cents this period[44] - Diluted earnings per share are not presented as there are no potential ordinary shares in issue[44] 8. Movements in Investment Properties During the interim period, the Group acquired an investment property for a cash consideration of approximately HKD 6,223 thousand, valued by the directors using the income approach, with no fair value changes from the acquisition date to the end of the period - During the interim period, the Group acquired an investment property for a cash consideration of approximately HKD 6,223 thousand[48] - The investment property was valued by the directors using the income approach, considering expected rental yields, rental income, and expenses[48] - There were no fair value changes from the date of acquisition to the end of the interim period[48] 9. Trade and Other Receivables As of June 30, 2019, the Group's net trade receivables and total other receivables both decreased, with a significant increase in the proportion of trade receivables aged 0 to 30 days Trade and Other Receivables (As of June 30, 2019) | Item | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | Net Trade Receivables | 36,928 | 41,240 | | Other Receivables, Deposits and Prepayments | 5,522 | 4,943 | | Total | 42,450 | 46,183 | Ageing Analysis of Trade Receivables (As of June 30, 2019) | Ageing | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | 0 to 30 days | 26,112 | 10,310 | | 31 to 60 days | 78 | 24,545 | | 61 to 90 days | 3,683 | 1,300 | | Over 90 days | 7,055 | 5,085 | | Total | 36,928 | 41,240 | - Net trade receivables decreased from HKD 41,240 thousand to HKD 36,928 thousand, with the proportion of 0 to 30 days ageing increasing from approximately 25% to approximately 70%[50] 10. Trade and Other Payables As of June 30, 2019, the Group's total trade and other payables significantly decreased, primarily due to a reduction in trade payables Trade and Other Payables (As of June 30, 2019) | Item | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | Trade Payables | 35,904 | 49,514 | | Accruals | 21,658 | 23,565 | | Total | 57,562 | 73,079 | Ageing Analysis of Trade Payables (As of June 30, 2019) | Ageing | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | 0 to 30 days | 18,857 | 17,149 | | 31 to 60 days | 6,540 | 17,459 | | 61 to 90 days | 2,179 | 3,790 | | Over 90 days | 8,328 | 11,116 | | Total | 35,904 | 49,514 | - Total trade payables decreased from HKD 49,514 thousand to HKD 35,904 thousand, with a significant reduction in trade payables aged 31 to 60 days[54] 11. Bank Borrowings As of June 30, 2019, the Group's total bank borrowings significantly decreased to HKD 3,221 thousand, primarily due to the repayment of advances on discounted bills receivable with recourse and corporate tax loans Bank Borrowings (As of June 30, 2019) | Item | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | Borrowings Repayable Within One Year — Secured and Floating | 3,221 | 10,151 | | Advances on Discounted Bills Receivable with Recourse | - | 3,000 | | Corporate Tax Loan | 3,221 | 7,151 | | Total | 3,221 | 10,151 | - Total bank borrowings significantly decreased from HKD 10,151 thousand to HKD 3,221 thousand[55] - The corporate tax loan is secured by pledged bank deposits and bears interest at 2% below Hong Kong Prime Rate[56] 12. Share Capital As of June 30, 2019, the Company's issued share capital increased to HKD 13,300 thousand, primarily due to the placing of 50,000,000 new shares on May 20, 2019 Movements in Share Capital (As of June 30, 2019) | Item | Number of Ordinary Shares | Total (HKD thousands) | | :--- | :--- | :--- | | As at December 31, 2018 | 1,280,000,000 | 12,800 | | Issue of Shares | 50,000,000 | 500 | | As at June 30, 2019 | 1,330,000,000 | 13,300 | - On May 20, 2019, the Company issued 50,000,000 ordinary shares of HKD 0.01 each through a placing, with proceeds of HKD 500 thousand credited to share capital and HKD 7,250 thousand to the share premium account[90] 13. Operating Lease Arrangements As of June 30, 2019, the Group's future minimum lease payments under non-cancellable operating leases for warehouse and office properties amounted to HKD 669 thousand, a decrease from December 31, 2018, and the Group has elected not to recognize right-of-use assets and lease liabilities for short-term leases Future Minimum Lease Payments Under Operating Leases (As of June 30, 2019) | Period | June 30, 2019 (HKD thousands) | December 31, 2018 (HKD thousands) | | :--- | :--- | :--- | | Within One Year | 643 | 158 | | Second to Fifth Year | 26 | 1,071 | | Total | 669 | 1,229 | - Total future minimum lease payments decreased from HKD 1,229 thousand to HKD 669 thousand, primarily due to a significant reduction in commitments for the second to fifth years[92] - The Group elected not to recognize right-of-use assets and lease liabilities for leases with a lease term ending within 12 months of the date of initial application and applied the short-term lease recognition exemption to leases of warehouse and office properties[93] 14. Related Party Transactions For the six months ended June 30, 2019, the Group engaged in transactions with related parties, including rental payments, with sub-contracting fees for building services engineering contracts with Kin Chun Decoration Engineering Company decreasing to zero Related Party Transactions (For the six months ended June 30) | Related Party | Nature of Transaction | 2019 (HKD thousands) | 2018 (HKD thousands) | | :--- | :--- | :--- | :--- | | Kin Chun Decoration Engineering Company | Sub-contracting fees for building services engineering contracts | - | 110 | | LKW Company Limited | Rent paid/payable | 244 | 244 | | Mr. Wong and Ms. So | Rent paid/payable | 246 | 246 | - Sub-contracting fees for building services engineering contracts with Kin Chun Decoration Engineering Company decreased from HKD 110 thousand in 2018 to zero in 2019[98] - Total remuneration for key management personnel was HKD 1,794 thousand, slightly higher than HKD 1,743 thousand in the prior year period[100] Management Discussion and Analysis Business Review and Outlook The Group primarily provides building services engineering services in Hong Kong, including the supply, installation, and maintenance of mechanical ventilation, air-conditioning, electrical, water supply, drainage, and fire services systems, facing negative impacts on revenue and gross margins due to intense market competition, delayed tender processes, reduced contract prices, and rising construction costs, with future strategies focusing on securing larger projects, expanding service scope, and strengthening the engineering department - The Group's principal business is to provide various engineering services for building services systems in Hong Kong, including the supply, installation, and maintenance of mechanical ventilation and air-conditioning systems, electrical systems, water supply and drainage systems, and fire services systems[103] - Intense competition in the construction market, prolonged delays in public and private sector tendering processes, leading to a decrease in the number of open tenders, lower contract prices, and rising construction costs, negatively impacted revenue and gross margins[103] - The Group will implement key business strategies: (i) undertaking more larger-scale projects; (ii) expanding its service scope; and (iii) strengthening its engineering department[106] Financial Review The financial performance significantly deteriorated during the period, with revenue sharply declining by nearly 40%, leading to a shift from gross profit to gross loss, and ultimately recording a total comprehensive loss, while administrative expenses slightly increased and income tax expense decreased to zero due to the loss Revenue For the six months ended June 30, 2019, revenue decreased by approximately 39.9% year-on-year, primarily due to cost overruns from extended project completion times, fewer projects, and lower average contract values - Revenue decreased by approximately 39.9% from approximately HKD 149.5 million in the prior year period to approximately HKD 89.9 million in the current period[107] - The decrease in revenue was mainly due to unexpected extensions in project completion times leading to cost overruns, a reduction in the number of projects, and lower average contract values compared to the previous year[107] Cost of Sales Cost of sales decreased by approximately 18.6% year-on-year to approximately HKD 98.5 million, primarily due to a reduction in building services engineering projects - Cost of sales decreased by approximately 18.6% to approximately HKD 98.5 million, mainly due to fewer building services engineering projects undertaken by the Group during the relevant period[108] Gross Profit / (Gross Loss) The Group recorded a gross loss of approximately HKD 8.6 million, compared to a gross profit of approximately HKD 28.5 million in the prior year period, with an overall gross loss margin of approximately 9.6%, primarily because the decrease in revenue outpaced the decrease in cost of sales - The Group recorded a gross loss of approximately HKD 8.6 million, compared to a gross profit of approximately HKD 28.5 million in the prior year period[111] - The overall gross loss margin was approximately 9.6%, compared to a gross profit margin of approximately 19.1% in the prior year period, mainly because the decrease in revenue was greater than the decrease in sub-contracting fees and direct labour costs[111] Administrative Expenses Administrative expenses increased by approximately 5.6% year-on-year to approximately HKD 9.3 million, primarily due to higher administrative staff salaries and other administrative expenses - Administrative expenses increased by approximately 5.6% from approximately HKD 8.8 million to approximately HKD 9.3 million[112] - This increase was due to higher administrative staff salaries and other administrative expenses during the relevant period[112] Income Tax Expense Income tax expense decreased by approximately 100% from approximately HKD 3.4 million in the prior year period to zero in the current period, primarily due to the absence of assessable profit - Income tax expense decreased by approximately 100% from approximately HKD 3.4 million to zero[113] - This decrease was due to the absence of assessable profit for the six months ended June 30, 2019[113] Total (Loss) Profit and Comprehensive (Loss) Income The Group recorded a total loss and comprehensive loss of approximately HKD 17.2 million, compared to a total profit and comprehensive profit of approximately HKD 16.8 million in the prior year period, primarily due to the combined impact of a significant decrease in revenue, gross loss, and increased administrative expenses - The Group recorded a total loss and comprehensive loss of approximately HKD 17.2 million, compared to a total profit and comprehensive profit of approximately HKD 16.8 million in the prior year period[114] - This change was mainly due to the combined impact of a significant decrease in revenue, the gross loss incurred, and increased administrative expenses[114] Liquidity and Financial Resources As of June 30, 2019, the Group's total assets and total liabilities both decreased, total interest-bearing loans and borrowings significantly reduced, and the current ratio improved, with the Group adopting a prudent financial management strategy to closely monitor its liquidity position - As of June 30, 2019, the Group's total assets were approximately HKD 191.2 million (December 31, 2018: approximately HKD 223.7 million)[117] - Total interest-bearing loans and borrowings were approximately HKD 3.2 million (December 31, 2018: HKD 10.1 million), and the current ratio was approximately 2.9 times (December 31, 2018: approximately 2.6 times)[117] - The Group adopts a prudent financial management strategy, continuously conducts credit evaluations of customers, and closely monitors its liquidity position[121] Gearing Ratio As of June 30, 2019, the Group's gearing ratio was approximately 2.5%, a significant decrease from 7.4% as of December 31, 2018, primarily due to net proceeds from share placing and repayment of advances on bills receivable - The gearing ratio was approximately 2.5% (December 31, 2018: 7.4%)[119] - The decrease in the ratio was due to the receipt of net proceeds from the share placing and the repayment of advances on bills receivable[119] Treasury Policy The Group adopts a prudent financial management strategy, maintaining a robust liquidity position, and ensures its funding needs are met through credit evaluation and liquidity monitoring - The Group adopts a prudent financial management strategy in executing its treasury policy, maintaining a robust liquidity position[121] - Credit risk is mitigated through credit evaluation and financial assessment of customers[121] - The Board closely monitors the Group's liquidity position to ensure its funding needs are met[121] Pledges of Assets As of June 30, 2019, the Group pledged bank deposits of approximately HKD 7.3 million and an investment property to banks as collateral for bank financing - The Group pledged bank deposits of approximately HKD 7.3 million to banks as collateral for bank financing (December 31, 2018: HKD 13.5 million)[124] - The Group pledged an investment property located at Unit B9, 6/F, Block B, Tonic Industrial Centre, 19 Lam Hing Street, Kowloon Bay, Hong Kong, to banks as collateral for all amounts under bank financing[124] Foreign Exchange Risk All of the Group's business and borrowings are transacted in Hong Kong dollars, thus it did not face significant foreign exchange rate fluctuation risk for the six months ended June 30, 2019, and has not formulated any hedging policy - All of the Group's revenue-generating business and borrowings are transacted in Hong Kong dollars[126] - For the six months ended June 30, 2019, there was no significant foreign exchange rate fluctuation risk[126] - The Group has not formulated any hedging policy against foreign currency risk, and management will consider hedging significant currency risks when necessary[126] Share Capital Structure The Company's shares were transferred to the Main Board of the Stock Exchange on February 12, 2018, and as of June 30, 2019, the issued share capital was HKD 13,300 thousand, with 1,330,000,000 ordinary shares in issue, primarily due to the placing of 50,000,000 new shares on May 20, 2019 - The Company's shares were transferred to the Main Board of the Stock Exchange on February 12, 2018[127] - As of June 30, 2019, the Company's issued share capital was HKD 13,300 thousand (December 31, 2018: HKD 12,800 thousand)[127] - The number of ordinary shares in issue was 1,330,000,000, primarily due to the placing of 50,000,000 new shares on May 20, 2019[127] Commitments As of June 30, 2019, the Group had no significant capital commitments for property, plant, and equipment or investment properties - As of June 30, 2019, the Group had no significant capital commitments for property, plant, and equipment or investment properties[130] Future Plans for Material Investments and Capital Assets As of June 30, 2019, the Group had no other future plans for material investments or capital assets - The Group had no other future plans for material investments or capital assets as of June 30, 2019[131] Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures For the six months ended June 30, 2019, the Group did not have any material acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2019, the Group did not have any material acquisitions or disposals of subsidiaries, associates, or joint ventures[132] Contingent Liabilities As of June 30, 2019, the Group had no significant contingent liabilities - As of June 30, 2019, the Group had no significant contingent liabilities (December 31, 2018: nil)[133] Employees and Remuneration Policy As of June 30, 2019, the Group employed 94 employees, with staff costs of approximately HKD 19.5 million, offering competitive benefits including retirement and medical benefits, training courses, and bonuses and share options based on performance - As of June 30, 2019, the Group employed a total of 94 employees (December 31, 2018: 91 employees)[136] - Staff costs (including directors' remuneration) for the six months ended June 30, 2019, were approximately HKD 19.5 million (prior year period: approximately HKD 20.2 million)[136] - The Group provides competitive benefits, including retirement benefits, medical benefits, and sponsored training courses, and awards bonuses and share options based on the Group's performance and individual performance[136] Material Investments Held The Group completed the acquisition of an investment property in Kowloon Bay, Hong Kong, in May 2019 for approximately HKD 6.2 million, which is currently leased to an independent third party, and holds no other material investments - The Group completed the acquisition of an investment property located at Unit B9, 6/F, Block B, Tonic Industrial Centre, 19 Lam Hing Street, Kowloon Bay, Hong Kong, in May 2019 for a consideration of approximately HKD 6.2 million[137] - The investment property is currently leased to an independent third party at market rent[137] - Save as disclosed above, the Group does not hold any other material investments[137] Placing under General Mandate The Company completed the placing of 50,000,000 new shares on May 20, 2019, at a placing price of HKD 0.155 per share, generating net proceeds of approximately HKD 7.47 million, with 90% earmarked for upfront costs and performance bonds for new projects and 10% for general working capital - The Company completed the placing of 50,000,000 new shares on May 20, 2019, at a placing price of HKD 0.155 per share[141] - The placing price represented a discount of approximately 11.93% to the closing price on the date of the placing agreement (May 6, 2019) and approximately 19.44% to the average closing price for the preceding five trading days[141] - The net proceeds from the placing were approximately HKD 7.47 million, of which approximately 90% will be used for upfront costs and performance bonds for new projects, and the remaining approximately 10% for general working capital[141] Disclosure of Interests As of June 30, 2019, directors and chief executives, as well as substantial shareholders, held interests in the Company's shares and ordinary shares of associated corporations, with Mr. Wong and his spouse Ms. So being key shareholders A. Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares or Debentures As of June 30, 2019, Mr. Wong held interests in the Company's shares directly and through controlled corporations, his spouse Ms. So was deemed to have an interest, and Mr. Tang Shun Man held a small number of shares Directors' Long Positions in Shares (As of June 30, 2019) | Director's Name | Capacity/Nature of Interest | Number of Shares Interested | Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Wong | Interest in controlled corporation | 653,000,000 | 49.10% | | Mr. Wong | Beneficial owner | 51,800,000 | 3.89% | | Ms. So | Spouse's interest | 704,800,000 | 52.99% | | Mr. Tang Shun Man | Beneficial owner | 160,000 | 0.01% | Directors' Long Positions in Ordinary Shares of Associated Corporations (As of June 30, 2019) | Director's Name | Name of Associated Corporation | Capacity/Nature of Interest | Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Wong | Golden Luck | Beneficial owner | 99% | | Ms. So | Golden Luck | Beneficial owner | 1% | B. Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares, Underlying Shares or Debentures As of June 30, 2019, other than the directors, Golden Luck was a substantial shareholder of the Company, holding 49.1% of the shares Substantial Shareholders' Long Positions in Shares (As of June 30, 2019) | Shareholder's Name | Capacity/Nature of Interest | Number of Shares Interested | Long/Short Position | Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Golden Luck | Beneficial owner | 653,000,000 | Long Position | 49.1% | Competing Interests During the relevant period, none of the directors, controlling shareholders, or their close associates held any business or interest that competed or might compete with the Group's business - During the relevant period, none of the directors or controlling shareholders of the Company or their respective close associates held any business or interest that competed or might compete with the Group's business[156] Directors' Material Interests in Contracts Save as disclosed in the prospectus or this report, no director had any material interest in any contract of significance to the Group's business to which the Company or any of its subsidiaries was a party during the relevant period - During the relevant period, no director had any material interest in any contract of significance to the Group's business to which the Company or any of its subsidiaries was a party[157] Purchase, Sale or Redemption of the Company's Listed Securities During the relevant period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the relevant period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[158] Corporate Governance Code The Company has complied with the applicable code provisions of the Corporate Governance Code set out in Appendix 14 to the Listing Rules throughout the relevant period - The Company has complied with the applicable code provisions of the Corporate Governance Code set out in Appendix 14 to the Listing Rules throughout the relevant period[159] Code for Securities Transactions by Directors The Group has adopted a code of conduct for securities transactions by directors that is no less stringent than the Model Code set out in the Listing Rules, and all directors have confirmed their compliance with this code during the relevant period - The Group has adopted a code of conduct for securities transactions by directors, the terms of which are no less stringent than the Model Code set out in Appendix 10 to the Listing Rules[162] - All directors have confirmed their compliance with the required standards set out in the code of conduct during the relevant period[162] Dividends The Board of Directors resolved not to declare any interim dividend for the relevant period - The Board of Directors resolved not to declare any interim dividend for the relevant period[163] Share Option Scheme The Company adopted a share option scheme in 2015, but no share options have been granted since its adoption, and no share options were outstanding as of June 30, 2019 - The Company conditionally adopted a share option scheme on September 10, 2015[164] - No share options have been granted since the adoption of the scheme, and no share options were outstanding as of June 30, 2019[164] Events After Reporting Period No significant events have occurred from the end of the relevant period up to the date of this report - No significant events have occurred from the end of the relevant period up to the date of this report[168] Audit Committee The Company's Audit Committee, comprising three independent non-executive directors, is responsible for reviewing and monitoring financial reporting, internal control, and risk management systems, and has reviewed the unaudited condensed consolidated financial statements for the current period - The Audit Committee was established on September 10, 2015, and comprises three independent non-executive directors, with Mr. Tam Chun Chung as chairman[169] - The primary responsibilities of the Audit Committee are to review and monitor the Group's financial reporting process, internal control and risk management systems, nominate and monitor external auditors, and oversee the Company's continuing connected transactions[169] - The unaudited condensed consolidated financial statements of the Group for the relevant period have been reviewed by the Company's Audit Committee[169]