Financial Performance - The Group reported a revenue of HK$80.9 million for FY2020, a decrease of 13.3% compared to HK$93.3 million in FY2019[15]. - The net loss for FY2020 was HK$16.2 million, representing a 66.5% reduction from a net loss of HK$48.3 million in FY2019[16]. - Basic loss per share for FY2020 was HK1.51 cents, compared to HK4.39 cents for FY2019[16]. - Revenue decreased by approximately HK$12.4 million or 13.3% from approximately HK$93.3 million in FY2019 to approximately HK$80.9 million for the Reporting Period[55]. - Gross profit decreased by approximately HK$3.8 million or 14.0% from approximately HK$27.1 million in FY2019 to approximately HK$23.3 million for the Reporting Period[61]. - Gross profit margin decreased from 29.0% in FY2019 to 28.9% for the Reporting Period, primarily due to a decrease of 2.6 percentage points in gross profit margin from Construction Services[61]. - Administrative and other operating expenses decreased by approximately HK$8.9 million from approximately HK$47.8 million in FY2019 to approximately HK$38.9 million for the Reporting Period[62]. - The Group's loss attributable to owners decreased to approximately HK$15.3 million for the Reporting Period, a reduction of approximately HK$29.1 million compared to a loss of HK$44.4 million in FY2019[63]. - Revenue from Prefabricated Construction decreased by approximately HK$6.5 million, while revenue from Construction Services decreased by approximately HK$3.3 million[55]. Impact of Covid-19 - The construction industry faced significant challenges due to Covid-19, including site shutdowns, labor shortages, and supply chain disruptions[17]. - The Hong Kong Government's measures to contain Covid-19 have created uncertainties affecting business operations across various sectors[17]. - The overall economic impact of Covid-19 has adversely affected the construction business in Hong Kong[17]. - The Group is navigating business disruptions caused by the ongoing pandemic[17]. - The construction industry in Hong Kong faces challenges such as labor shortages and project delays due to the pandemic, impacting overall business operations[20]. - The Group's prefabricated construction business showed improvement in the second half of 2020, regaining positive momentum after a significant revenue drop in the first half due to Covid-19 disruptions[22]. - The Group plans to expand into overseas markets, particularly in countries along the Belt and Road, but many projects have been deferred or terminated due to ongoing Covid-19 challenges[23]. - The construction activities in China are gradually reviving and stabilizing as the country manages to contain the Covid-19 pandemic[22]. - The Group remains vigilant against uncertainties in the Chinese economy, including potential Covid-19 rebounds and US-China tensions[22]. Market and Competition - Competition for public sector construction projects has intensified, with construction expenditure in Hong Kong contracting due to stalled budget approvals[17]. - The Group's revenue from private sector projects decreased to HK$49,442,000 in 2020 from HK$51,139,000 in 2019, representing a decline of approximately 3.3%[38]. - Revenue from public sector projects also fell to HK$8,505,000 in 2020 from HK$10,150,000 in 2019, a decrease of about 16.2%[38]. - The Group's performance reflects the broader challenges faced by small and mid-sized companies listed on the GEM[3]. Corporate Governance - The Board of Directors is responsible for formulating the Group's overall strategies, setting management targets, and supervising management performance[114]. - The Company complied with the GEM Listing Rules throughout the year ended December 31, 2020, including the independence of all non-executive Directors[117][118]. - The Group encourages Directors to attend at least one training course on updates of the GEM Listing Rules concerning good corporate governance practices[129]. - The Company has established three functional committees: the Audit Committee, the Nomination Committee, and the Remuneration Committee, to assist the Board in discharging its duties[130]. - The Board's composition includes both Executive and Independent Non-executive Directors, ensuring compliance with GEM Listing Rules[120]. - The Audit Committee held 4 meetings during the Reporting Period, with all members attending all meetings[142]. - The Audit Committee reviewed the Group's audited results for the year ended 31 December 2019 and the unaudited quarterly results for the three months ended 31 March 2020, six months ended 30 June 2020, and nine months ended 30 September 2020[142]. - The Company has provided sufficient resources and support to all committees to fulfill their responsibilities[132]. - The Remuneration Committee held 1 meeting during the Reporting Period, with all members attending[149]. - The Nomination Committee also held 1 meeting during the Reporting Period, with full attendance by its members[158]. Risk Management - The Board is responsible for establishing and maintaining effective internal control and risk management systems to safeguard shareholder interests[189]. - The risk management and internal control systems are designed to manage risks rather than eliminate them, providing reasonable assurance against material misstatement or loss[190]. - The Group has established a risk management policy to identify, evaluate, and manage principal risks affecting the business[191]. - The Group's risk management and internal control system aims to manage risks rather than eliminate them, providing reasonable assurance against material misstatement or loss[200]. - An external consultant conducted a review of the internal control system, identifying no significant areas of concern affecting financial and operational controls[199]. Financial Position - As of December 31, 2020, the group had cash and bank deposits of approximately HK$37.3 million, an increase from approximately HK$30.5 million in 2019[72][76]. - The total borrowings of the group amounted to approximately HK$64.3 million as of December 31, 2020, compared to approximately HK$45.8 million in 2019, with annual interest rates ranging from 6.75% to 12%[81][88]. - The gearing ratio of the group as of December 31, 2020, was approximately 1.61, up from approximately 0.84 in 2019[72][76]. - The group has maintained a healthy liquidity position and closely monitors its liquidity structure to meet funding requirements[73]. - The company does not recommend the payment of a final dividend for the reporting period, consistent with 2019[87]. - The company has reallocated unutilized proceeds from the listing to meet general working capital needs due to the non-pressing demand for enhancing machinery and equipment[70][69]. Strategic Initiatives - The Group is exploring opportunities in the agriculture-related business due to increasing demand for green food, and is negotiating with agribusinesses for potential cooperation[43]. - The Group has suspended its clean coal trading business due to operating losses and has no concrete plans to restart it[49]. - The negotiation and due diligence for the Proposed Investment in Hubei Bio-great Agricultural Technology Co., Ltd is ongoing, with no concrete timeline established[48]. - The Group's market diversification plan may take additional time to implement due to the ongoing impact of the pandemic on international projects[23].
朝威控股(08059) - 2020 - 年度财报