Financial Performance - The company reported a revenue decrease of 24.9% from approximately SGD 8,501,000 in 2019 to about SGD 6,383,000 in 2020[11]. - The annual gross profit was approximately SGD 672,000, down from SGD 1,987,000 in 2019, resulting in a gross margin of about 10.5% compared to 23.4% in the previous year[16]. - The company incurred a net loss of approximately SGD 3,427,000 in 2020, compared to a loss of SGD 1,587,000 in 2019[11]. - Total revenue for the year 2020 was SGD 6,383,204, a decrease of 25.0% from SGD 8,500,700 in 2019[159]. - Gross profit for 2020 was SGD 672,370, down 66.1% from SGD 1,987,398 in 2019[159]. - The company reported a net loss of SGD 3,427,279 for 2020, compared to a net loss of SGD 1,586,829 in 2019, representing an increase in loss of 116.5%[159]. - Total assets decreased to SGD 15,695,621 in 2020 from SGD 18,386,619 in 2019, a decline of 14.6%[161]. - Current assets decreased to SGD 11,104,318 in 2020 from SGD 13,313,904 in 2019, a reduction of 16.5%[161]. - The company's total liabilities increased to SGD 5,432,000 in 2020 from SGD 5,267,067 in 2019, an increase of 3.1%[161]. - The net asset value decreased to SGD 10,263,621 in 2020 from SGD 13,119,552 in 2019, a decline of 21.7%[161]. - The company recognized other income of SGD 760,301 in 2020, significantly higher than SGD 188,633 in 2019, an increase of 302.4%[159]. - The financing costs rose to SGD 56,521 in 2020 from SGD 24,436 in 2019, an increase of 131.9%[159]. - The company reported a basic and diluted loss per share of SGD 2.678 for 2020, compared to SGD 1.240 in 2019, an increase of 115.0%[159]. - Total equity decreased from SGD 13,119,552 in 2019 to SGD 10,263,621 in 2020, representing a decline of approximately 21.6%[41]. - Operating cash flow used in 2020 was SGD (2,424,472), a significant increase from SGD (833,583) in 2019, reflecting a worsening cash flow situation[44]. - The company’s cash and cash equivalents decreased from SGD 7,629,334 at the beginning of 2020 to SGD 3,260,267 by year-end, a reduction of approximately 57.2%[45]. - The company incurred a pre-tax loss of SGD (3,540,990) in 2020, compared to SGD (1,627,175) in 2019, marking an increase in pre-tax losses of approximately 117.5%[43]. Expenses and Cost Management - Selling and administrative expenses increased to approximately SGD 4,122,000 in 2020 from SGD 3,161,000 in 2019, primarily due to higher advertising and share-based payment expenses[17]. - The total employee cost, including directors' remuneration, was approximately SGD 3,344,000 for the year ended December 31, 2020, compared to SGD 3,142,000 in 2019[29]. - The company will continue to manage its expenses and review its business strategies to seek new opportunities in the current market environment[12]. Market Outlook and Business Strategy - The company anticipates a decline in revenue and gross profit in the local construction market due to ongoing COVID-19 impacts and increased competition[12]. - The company has initiated subcontracting services for commercial and residential property development and renovation projects in Hong Kong, expected to generate revenue in 2021[12]. - The company plans to diversify its existing business portfolio to expand revenue sources amid challenging market conditions[12]. Governance and Compliance - The company held 5 board meetings and 2 shareholder meetings during the year ended December 31, 2020, with all directors confirming their compliance with trading rules[45]. - The audit committee, established on June 23, 2015, consists of three independent non-executive directors, with the chairman possessing appropriate professional qualifications[51]. - The board believes that good corporate governance is essential for managing the group's business and affairs, and has complied with the corporate governance code for the year ended December 31, 2020[42]. - The company has appointed three independent non-executive directors, representing over one-third of the board, ensuring compliance with GEM listing rules[49]. - All directors participated in continuous professional development to enhance their knowledge and skills relevant to their roles as directors of a listed company[50]. - The company’s management regularly reviews its corporate governance practices to align with the GEM listing rules and corporate governance code[42]. - The board is responsible for overseeing the company and has authorized executive directors and management to handle daily operations[44]. - The company has established a code of conduct for directors' securities trading, ensuring compliance with GEM listing rules[43]. - The chairman and CEO roles are clearly separated, with the chairman responsible for overall management and strategic planning[47]. - The company’s independent non-executive directors provide strategic advice to ensure compliance with financial and regulatory requirements[49]. Risk Management - The company has established a risk management and internal control system to safeguard shareholder investments and group assets[66]. - The company’s board is responsible for evaluating and determining the nature and extent of risks acceptable in achieving strategic objectives[66]. - The group has engaged an independent consultant to perform internal audit functions and assess the risk management and internal control systems, reporting directly to the audit committee[68]. - As of December 31, 2020, the group’s risk management and internal control systems were deemed sufficient and effective by the audit committee and board[68]. - The board acknowledges that the established risk management and internal control systems provide reasonable, but not absolute, assurance against foreseeable adverse events[69]. Shareholder Information - As of December 31, 2020, the company’s executive director Chen Tianji holds 39,337,600 shares, representing approximately 30.73% of the issued share capital[116]. - Major shareholder Absolute Truth Investments Limited, controlled by Chen Tianji and Chen Guanghui, also holds 39,337,600 shares, equating to 30.73% of the issued share capital[120]. - Wang Yafei and Han Dongshen are significant shareholders, holding 9,600,000 shares (7.50%) and 7,040,000 shares (5.50%) respectively[120]. - The company confirmed that at least 25% of its issued share capital is held by the public as of the last practicable date before the report publication[125]. Financial Resources and Investments - The group has not early adopted any new or revised International Financial Reporting Standards (IFRS) that are not yet effective, indicating a stable accounting policy environment[174]. - The group expects that the application of all other new IFRS and amendments will not have a significant impact on the consolidated financial statements in the foreseeable future[177]. - The company has sufficient financial resources for ongoing operations based on its current financial condition and available financing[90]. - The company has no significant violations of applicable laws and regulations that would materially impact its business and operations during the year ended December 31, 2020[104]. Share Options and Equity - The company granted a total of 12,800,000 share options at an exercise price of HKD 0.45, valid from April 9, 2020, to April 8, 2022[127]. - As of December 31, 2020, no share options were exercised, expired, or canceled, leaving 12,800,000 options unexercised[127]. - The company has adopted a share option scheme aimed at incentivizing eligible participants for their contributions to the company[129]. Trade Receivables and Credit Management - As of December 31, 2020, the total trade receivables amounted to approximately SGD 2,012,480, a decrease from SGD 2,533,433 in 2019[144]. - The expected credit loss provision net amount was approximately SGD 565,231, compared to SGD 554,005 in 2019[144]. - The credit period granted to customers generally ranges from 30 to 60 days[144]. - The management regularly assesses the recoverability of trade receivables based on various factors including customer credit status and historical settlement records[144]. - The expected credit loss assessment involves significant management judgment and estimates[145].
吉辉控股(08027) - 2020 - 年度财报