Financial Performance - The Group recorded a turnover of approximately HK$337.9 million with a gross profit of approximately HK$91.4 million for the year ended 31 March 2021, compared to HK$238.5 million and HK$79.9 million for the previous year, resulting in a loss of approximately HK$23.4 million[12]. - The gross profit from the financial services business increased by approximately HK$11.5 million to HK$49.8 million for the year ended 31 March 2021, up from HK$36.5 million in the previous year[12]. - Administrative expenses rose by approximately HK$28.6 million due to the full-year impact of the financial services business acquisition completed on 31 December 2019[12]. - The trading business recorded a turnover of approximately HK$250.6 million with a loss of approximately HK$6.1 million for the year ended 31 March 2021, compared to HK$161.3 million and HK$2.9 million for the previous year[15]. - The Group recognized a provision for impairment loss on trade receivables of approximately HK$8.2 million, contributing to the loss in the trading business[15]. - Interest income recognized by the Group for the year ended March 31, 2021, was approximately HK$19.1 million, compared to HK$14.1 million for the previous year, while profit decreased to approximately HK$2.5 million from HK$9.7 million[19]. - The finance leasing business maintained a portfolio with an outstanding amount of approximately HK$120.3 million as of March 31, 2021, generating a turnover of approximately HK$17.1 million and a profit of approximately HK$3.5 million[20]. - The finance leasing portfolio's turnover decreased from approximately HK$25.7 million and profit from HK$18.2 million in the previous year[20]. - The Group provided an impairment loss on loan and factoring receivables of approximately HK$13.4 million during the year ended March 31, 2021, impacting profit from this segment[19]. Operational Challenges - The financial year faced significant challenges due to the COVID-19 pandemic, impacting the operation and financial strength of certain customers, leading to defaults in repayment[9]. - The Group adopted various measures to mitigate operational risks, but it was necessary to provide for impairment losses on receivables, affecting financial performance for the year ended March 31, 2021[9]. - The management is cautious about the changing trading environment due to intensified Sino-US trade frictions and the COVID-19 pandemic, implementing strict procurement and cost control measures[18]. - The Group will closely monitor the development of COVID-19 to adapt its policies accordingly[20]. Strategic Initiatives - The Group will reassess and re-engineer its strategies in response to the changing environment, as the state of pandemic control remains uncertain[9]. - Looking ahead, the Group aims to identify and explore investment and business opportunities to strengthen and broaden its asset and revenue base[9]. - The Group will cautiously seize opportunities to enhance and improve business operations and profitability[9]. - The Group plans to adopt a more prudent credit risk assessment and avoid customers in industries highly impacted by the COVID-19 pandemic[21]. - The Group will actively identify and explore other investment and business opportunities to broaden its assets and revenue base[23]. Corporate Governance - The Board has been in compliance with all code provisions set out in the Corporate Governance Code for the year ended 31 March 2021[40]. - The Board is responsible for corporate governance and has established an internal control group for specific operations[40]. - The Company arranged appropriate insurance cover for Directors' liabilities during the year ended March 31, 2021, with no claims made against the Directors throughout the year[42]. - The Company has appointed three independent non-executive Directors, with Mr. Chi Chi Hung having appropriate professional qualifications and related experiences in financial matters[48]. - The procedures for the appointment, re-election, and removal of Directors are outlined in the Company's bye-laws, ensuring a structured governance process[51]. - The Company Secretary ensures compliance with Listing Rules and prepares annual and interim reports within the required time limits[65]. - The Company has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee, with a majority of independent non-executive directors[73]. Risk Management - Financial risk factors include credit risk, market risk, and liquidity risk, with details provided in the consolidated financial statements[36]. - The Group's risk management process includes risk identification, assessment, evaluation, and treatment, ensuring a systematic approach to managing risks[90]. - The Board, through the Audit Committee, has reviewed the effectiveness of the risk management and internal control systems, finding them to be effective and adequate[89]. - The internal audit function is implemented to address major control weaknesses identified during audits, aiming to resolve significant internal control defects[90]. Employee and Community Engagement - The Group employs approximately 66 employees, an increase from 57 in 2020[37]. - The Group's operations in the PRC significantly contribute to its revenue, and unfavorable events in the country could disrupt overall business and lower revenues[36]. - The Group emphasizes ongoing communication with shareholders through interim and annual reports, ensuring transparency[102]. - The Group's annual general meeting serves as a platform for shareholders to exchange views with the Board, with relevant information sent at least 21 days prior[102]. - The Group donated HK$1.5 million to support communities severely affected by the COVID-19 pandemic[158]. Environmental and Social Responsibility - The Group is committed to maintaining high environmental standards and complied with relevant laws and regulations during the year ended 31 March 2021[37]. - The Group is committed to environmental protection and adheres to applicable environmental laws and regulations, with no material non-compliance reported during the Reporting Period[151]. - The Group aims to minimize emissions and enhance energy efficiency by optimizing electricity consumption and turning off idle electrical appliances[151]. - The Group has implemented a red packet and mooncake box recycling program to promote environmental protection and reduce waste at the source[158]. - The Group has established an Anti-Money Laundering and Counter Terrorist Financing (AML/CTF) Policy to prevent money laundering and terrorist financing activities, including risk assessment and ongoing monitoring of customers[148].
香港潮商集团(02322) - 2021 - 年度财报