东方大学城控股(08067) - 2021 Q3 - 季度财报

Company Information This section provides fundamental details about the company's structure and operational context Financial Highlights For the nine months ended March 31, 2021, the company's revenue decreased by 14.1% to RMB 50.2 million, while profit attributable to owners increased by 10.4% to RMB 22.4 million, with basic earnings per share at RMB 0.12, up 9.1% Financial Highlights for the Nine Months Ended March 31, 2021 | Metric | Amount (RMB million) | Year-on-Year Change | | :--- | :--- | :--- | | Revenue | 50.2 | -14.1% | | Profit Attributable to Owners | 22.4 | +10.4% | | Basic Earnings Per Share | 0.12 | +9.1% | Financial Statements Presents the company's condensed consolidated financial statements, including profit or loss, and changes in equity Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the nine months ended March 31, 2021, the company's revenue decreased by 14.1% to RMB 50.19 million due to lower education facility leasing, yet profit attributable to owners rose 10.4% to RMB 22.39 million, boosted by fair value gains on investment properties and increased share of associate results Summary of Profit or Loss Statement for the Nine Months Ended March 31, 2021 | Item (RMB '000) | Nine Months Ended March 31, 2021 | Nine Months Ended March 31, 2020 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 50,185 | 58,448 | -14.1% | | Operating Profit | 47,395 | 27,184 | +74.3% | | Profit Before Income Tax | 38,992 | 24,192 | +61.2% | | Profit for the Period | 22,985 | 20,548 | +11.9% | | Profit Attributable to Owners of the Company | 22,394 | 20,285 | +10.4% | | Basic Earnings Per Share (RMB) | 0.12 | 0.11 | +9.1% | - The period saw a fair value gain on investment properties of RMB 43.43 million and a fair value loss on convertible notes of RMB 24.93 million, significantly impacting operating profit[9] Condensed Consolidated Statement of Changes in Equity As of March 31, 2021, total equity attributable to owners increased to RMB 1.225 billion from RMB 1.204 billion on June 30, 2020, primarily due to profit recorded during the period Summary of Changes in Equity | Item (RMB '000) | As at June 30, 2020 | Total Comprehensive Income for the Period | As at March 31, 2021 | | :--- | :--- | :--- | :--- | | Equity Attributable to Owners of the Company | 1,203,561 | 21,768 | 1,225,329 | | Total Equity | 1,213,942 | 22,359 | 1,236,301 | Notes to the Condensed Consolidated Third Quarter Results Provides detailed explanatory notes to the condensed consolidated third quarter financial results, covering various accounting and operational aspects General Information The company is an investment holding company primarily engaged in education facility leasing in China, Malaysia, and Indonesia, with its ultimate parent being Singapore-listed Raffles Education Corporation - The company's principal business involves providing education facility leasing services in China, Malaysia, and Indonesia[12] Basis of Preparation and Principal Accounting Policies This unaudited quarterly report is prepared under Hong Kong Financial Reporting Standards, consistent with the audited annual financial statements as of June 30, 2020, with no significant impact from new standard amendments - The quarterly results have been reviewed by the Audit Committee but remain unaudited[14] Revenue and Segment Information The company's revenue primarily stems from education facility leasing, accounting for over 93% of total revenue, with no business or geographical segment information presented due to the minor contribution from commercial leasing and predominant operations in China Revenue Breakdown for the Nine Months Ended March 31, 2021 | Revenue Category | Amount (RMB '000) | Proportion | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Education Facility Leasing | 46,775 | 93.2% | -11.5% | | Ancillary Commercial Leasing | 3,410 | 6.8% | -39.2% | | Total | 50,185 | 100% | -14.1% | Interest (Expense) / Income Interest expense surged 144.0% to RMB 8.44 million due to new loan financing, while interest income plummeted 91.9% as a third-party loan from the prior period was fully collected - Interest expense significantly increased due to new term loan financing obtained in China and Indonesia[46] - Interest income substantially decreased as interest from an independent third-party loan in the prior period was fully collected in March 2020[45] Income Tax Total income tax expense for the period was RMB 16.01 million, a 339.3% year-on-year increase, primarily driven by a RMB 14.13 million deferred tax expense from fair value changes in investment properties - Deferred tax liabilities accrued for the period amounted to RMB 14.13 million, primarily due to fair value changes in the Group's investment properties[25][21] Earnings / (Loss) Per Share For the nine months ended March 31, 2021, basic and diluted earnings per share were RMB 0.12, representing a 9.1% increase from RMB 0.11 in the prior year Earnings Per Share Calculation | Item | Nine Months Ended March 31, 2021 | Nine Months Ended March 31, 2020 | | :--- | :--- | :--- | | Profit Attributable to Owners of the Company (RMB '000) | 22,394 | 20,285 | | Weighted Average Number of Ordinary Shares in Issue ('000 shares) | 180,000 | 180,000 | | Basic Earnings Per Share (RMB) | 0.12 | 0.11 | Dividends The Board of Directors resolved not to declare any dividends for the reporting period - The Board has resolved not to declare any dividends for the period[28] Management Discussion and Analysis Provides an overview of the company's financial performance, business operations, and future outlook, along with key strategic initiatives Financial Review Revenue declined 14.1% due to COVID-19's impact on leasing, yet operating profit before fair value changes grew 6.3% through cost control and associate performance, while fair value losses from convertible note redemption were offset by investment property revaluation gains - Revenue decreased by 14.1% to RMB 50.19 million, primarily due to reduced leased space and terms by education institution clients impacted by the COVID-19 pandemic[30] - Effective cost control led to year-on-year decreases in property management fees by 28.9%, repair and maintenance expenses by 84.9%, and legal and professional fees by 39.3%[33][34][36] - Share of results from associate Axiom Properties Limited significantly increased from RMB 0.5 million to RMB 5.82 million, positively contributing to profit[39] - The period recorded a fair value gain on investment properties of RMB 43.5 million and a fair value loss on redemption of convertible notes of RMB 24.93 million[41][44] Business Review and Outlook The Group's core business is education facility leasing in China, Malaysia, and Indonesia; despite H1 pandemic impact, Q3 revenue normalized, with Q4 expected to be higher due to new clients and dormitory operations, and the company is preparing for a proposed Main Board listing transfer - Third-quarter revenue has returned to normal levels, comparable to the previous fiscal year, due to new clients signing contracts for education facility leases[50] - Fourth-quarter revenue is expected to be higher due to more new clients and the anticipated operation of new dormitories with approximately 10,000 square meters of gross floor area, generating an additional RMB 2.7 million to RMB 3.8 million in revenue[51] - The company has fully redeemed convertible notes to eliminate potential dilution and is preparing for the proposed transfer of its shares to the Main Board of the Stock Exchange[53] Use of Proceeds from Initial Public Offering Due to COVID-19 and uncertain economic outlook, the company reallocated unutilized IPO net proceeds to general working capital, with HKD 12.66 million remaining unutilized at period-end Summary of Use of Proceeds from Initial Public Offering (HKD million) | Purpose | Revised Allocation (HKD million) | Total Utilized as at March 31, 2021 (HKD million) | Net Unutilized Proceeds (HKD million) | | :--- | :--- | :--- | :--- | | Construction of Dormitories at Campuses | 31.80 | 31.80 | – | | General Working Capital | 43.50 | 30.84 | 12.66 | Significant Investments and Capital Commitments The Group's sole significant investment and capital commitment is the acquisition of the Misheel property in Ulaanbaatar, Mongolia, with construction expected to complete in 2022 - The Group is acquiring the Misheel property in Mongolia for a consideration of RMB 32.71 million, with RMB 14.74 million already paid and the balance to be paid in stages, with completion expected in 2022[58] Significant Acquisitions or Disposals During the reporting period, the Group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures - As at March 31, 2021, the Group had no significant acquisitions or disposals of subsidiaries, associates, and joint ventures[59] Continuing Connected Transactions The Group has ongoing property lease agreements with subsidiaries of its controlling shareholder, Raffles, in Malaysia and Indonesia, all executed on fair terms - The company's subsidiaries in Malaysia and Indonesia have entered into three-year property lease agreements with subsidiaries of Raffles Education Corporation, generating annual revenue of approximately RMB 3.02 million and RMB 3.21 million, respectively[60][61] Contingent Liabilities As of the end of the reporting period, the Group had no significant contingent liabilities - As at March 31, 2021, the Group had no significant contingent liabilities[63] Corporate Governance and Other Information Details the company's adherence to corporate governance principles and provides other relevant information regarding its operations and compliance Competing Interests The company's controlling shareholder, Raffles, has executed a non-competition undertaking, and no directors, controlling shareholders, or substantial shareholders hold interests competing with the Group's business Corporate Governance During the reporting period, the company complied with the Corporate Governance Code provisions outlined in Appendix 15 of the GEM Listing Rules Purchase, Sale or Redemption of the Company's Listed Securities Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the reporting period Directors' Securities Transactions The company adopted a standard code for directors' securities transactions, and all directors confirmed compliance during the reporting period Directors' and Chief Executive's Interests in Shares Discloses that Mr. Chew Hua Seng, Chairman and Executive Director, indirectly holds 135,000,000 shares, representing 75% of the issued share capital, through his controlling entity, Raffles Education Corporation - Mr. Chew Hua Seng, the company's Chairman, is deemed to have an interest in 135,000,000 shares, representing 75% of the total share capital, held through his controlling entity, Raffles Education Corporation[71][72] Major Shareholders' Interests Raffles Education Corporation, the company's direct controlling entity, beneficially owns 135,000,000 shares, representing 75% of the company's issued share capital - Raffles Education Corporation holds a 75% equity interest in the company, serving as its direct controlling shareholder[75] Directors' Interests in Transactions During the reporting period, no director held a material interest in any transaction, arrangement, or contract significant to the Group's business Review by Audit Committee The Audit Committee, comprising three independent non-executive directors, reviewed this quarterly report, deeming its preparation compliant with applicable accounting standards and GEM Listing Rules, with adequate disclosures - The Audit Committee has reviewed this third-quarter results report[78]