上海青浦消防(08115) - 2021 - 中期财报

Company Information Company Overview This section outlines Shanghai Qingpu Fire-Fighting Equipment Co., Ltd.'s GEM listing, directors' responsibility for report accuracy, and key corporate details - Shanghai Qingpu Fire-Fighting Equipment Co., Ltd. (Stock Code: 8115) H-shares are listed on GEM of the Hong Kong Stock Exchange[1][28] - Directors confirm the report information is accurate, complete, and free from misleading or fraudulent content in all material aspects[3] Company Basic Information | Metric | Details | | :----------- | :----------------------------------------- | | Stock Code | 8115 | | Registered Office | 1988 Jihe Road, Huaxin Town, Qingpu District, Shanghai, PRC | | Principal Place of Business in Hong Kong | Room 2605, Harbour Centre, 510 King's Road, North Point, Hong Kong | | Auditor | Tianjian Deyang Certified Public Accountants Co., Ltd. | | Principal Bankers | China Construction Bank Huaxin Branch, Shanghai Rural Commercial Bank Co., Ltd. Chonggu Branch | Interim Results Overview Financial Highlights For the six months ended June 30, 2021, the Group's revenue grew 22% to RMB 35.15 million, and profit attributable to owners surged 201% to RMB 3.327 million 2021 First Half Financial Highlights | Metric | 2021 First Half (RMB thousands) | 2020 First Half (RMB thousands) | Year-on-year Growth Rate | | :------------------------ | :------------------------ | :------------------------ | :------------------------- | | Revenue | 35,150 | 28,914 | 22% | | Profit attributable to owners of the Company | 3,327 | 1,106 | 201% | Financial Statements Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2021, the Group's revenue was RMB 35,150 thousand, gross profit RMB 11,267 thousand, profit attributable to owners RMB 3,327 thousand, and basic EPS 1.78 RMB cents Condensed Consolidated Statement of Profit or Loss Summary (For the six months ended June 30) | Metric | 2021 (RMB thousands) | 2020 (RMB thousands) | | :--------------------------------- | :------------------ | :------------------ | | Revenue | 35,150 | 28,914 | | Gross Profit | 11,267 | 8,925 | | Profit before tax | 7,399 | 3,679 | | Profit for the period | 6,179 | 3,460 | | Profit attributable to owners of the Company | 3,327 | 1,106 | | Basic earnings per share | 1.78 RMB cents | 0.65 RMB cents | Condensed Consolidated Statement of Comprehensive Income For the six months ended June 30, 2021, the Group's total comprehensive income was RMB 6,179 thousand, with RMB 3,327 thousand attributable to owners and RMB 2,852 thousand to non-controlling interests Condensed Consolidated Statement of Comprehensive Income Summary (For the six months ended June 30) | Metric | 2021 (RMB thousands) | 2020 (RMB thousands) | | :--------------------------------- | :------------------ | :------------------ | | Profit for the period | 6,179 | 3,460 | | Other comprehensive income for the period | - | - | | Total comprehensive income for the period | 6,179 | 3,460 | | Attributable to owners of the Company | 3,327 | 1,106 | | Attributable to non-controlling interests | 2,852 | 2,354 | Condensed Consolidated Statement of Financial Position As of June 30, 2021, the Group's total assets were RMB 111,701 thousand, with non-current assets of RMB 30,814 thousand and current assets of RMB 80,887 thousand, resulting in net assets of RMB 79,559 thousand, an increase from year-end 2020 Condensed Consolidated Statement of Financial Position Summary (As of June 30, 2021) | Metric | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Total non-current assets | 30,814 | 54,677 | | Total current assets | 80,887 | 54,678 | | Total current liabilities | 24,101 | 21,757 | | Net assets | 79,559 | 73,380 | | Total equity | 79,559 | 73,380 | - Total non-current assets decreased from RMB 54,677 thousand at year-end 2020 to RMB 30,814 thousand as of June 30, 2021, primarily due to investment properties being reclassified as non-current assets held for sale[14] - Total current assets increased from RMB 54,678 thousand at year-end 2020 to RMB 80,887 thousand as of June 30, 2021, mainly influenced by an increase in non-current assets held for sale[14] Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2021, equity attributable to owners of the Company increased from RMB 69,867 thousand to RMB 73,194 thousand, primarily driven by profit for the period Condensed Consolidated Statement of Changes in Equity Summary (As of June 30, 2021) | Metric | June 30, 2021 (RMB thousands) | June 30, 2020 (RMB thousands) | | :--------------------------------- | :------------------------- | :------------------------- | | Equity attributable to owners of the Company | 73,194 | 72,376 | | Non-controlling interests | 6,365 | 2,150 | | Total equity | 79,559 | 74,526 | - In the first half of 2021, profit and total comprehensive income attributable to owners of the Company amounted to RMB 3,327 thousand[18] Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2021, the Group generated RMB 3,952 thousand net cash from operating activities, with a net increase in cash and cash equivalents of RMB 2,612 thousand, bringing period-end cash and cash equivalents to RMB 33,208 thousand Condensed Consolidated Statement of Cash Flows Summary (For the six months ended June 30) | Metric | 2021 (RMB thousands) | 2020 (RMB thousands) | | :--------------------------------- | :------------------ | :------------------ | | Net cash generated from operating activities | 3,952 | (34) | | Net cash used in investing activities | (719) | (7) | | Net cash used in financing activities | (621) | (83) | | Net increase in cash and cash equivalents | 2,612 | (124) | | Cash and cash equivalents at end of period | 33,208 | 26,381 | Notes to the Financial Statements General Information and Basis of Preparation The Group's unaudited condensed consolidated financial statements are prepared under IAS 34, IFRS, and GEM Listing Rules, primarily using historical cost, except for fair-valued investment properties - The Company's immediate holding company is Liancheng Fire-Fighting Group Co., Ltd., and its ultimate holding company is Zhejiang Hengtai Real Estate Co., Ltd[29] - The financial statements are primarily prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' and International Financial Reporting Standards, and comply with the GEM Listing Rules[30] - The revised International Financial Reporting Standards adopted for the first time in the current period had no significant impact on the financial statements[31] Accounting Policies and Standards The Group adopted revised IFRS, including amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4, and IFRS 16, with no material impact on current financial statements, and lists new IFRS issued but not yet effective - The Group has adopted several revised International Financial Reporting Standards, including amendments related to interest rate benchmark reform and COVID-19-related rent concessions, none of which had a significant impact on the current financial statements[31] - The report lists several issued but not yet effective International Financial Reporting Standards, including references to the Conceptual Framework and sales or contributions of assets between an investor and its associate or joint venture[33][35] Operating Segment Information The Group operates in six segments: fire-fighting equipment, aquarium products, marine fire-fighting equipment, testing services, property investment, and trading; for the six months ended June 30, 2021, aquarium products generated the highest revenue, and property investment contributed the highest profit before tax - The Group's six reportable operating segments are: fire-fighting equipment, aquarium products, marine fire-fighting equipment, testing services, property investment, and trading[36] 2021 First Half Revenue and Profit by Operating Segment | Segment | Revenue (RMB thousands) | Segment Profit (RMB thousands) | | :------------------------- | :---------------- | :-------------------- | | Fire-fighting equipment | 8,155 | (2,737) | | Aquarium products | 15,436 | 3,404 | | Marine fire-fighting equipment | 3,846 | (493) | | Testing services | 4,365 | 795 | | Property investment | 3,348 | 5,785 | | Trading | - | - | | Total | 35,150 | 6,754 | - Management monitors resource allocation and assesses performance based on the results of each operating segment, with segment results measured by adjusted profit/(loss) before tax[37] Revenue and Other Income For the six months ended June 30, 2021, the Group's total revenue was RMB 35,150 thousand, with aquarium product sales as the largest contributor; other income and gains significantly increased to RMB 4,176 thousand, primarily from fair value gains on investment properties 2021 First Half Revenue Composition | Revenue Source | 2021 First Half (RMB thousands) | 2020 First Half (RMB thousands) | | :------------------------- | :------------------------ | :------------------------ | | Sales of pressure vessels | 8,155 | 7,946 | | Sales of aquarium products | 15,436 | 9,069 | | Sales of marine fire-fighting equipment | 3,846 | 4,718 | | Testing service fees | 4,365 | 4,037 | | Gross rental income | 3,348 | 2,834 | | Total revenue | 35,150 | 28,914 | 2021 First Half Other Income and Gains | Other Income and Gains Source | 2021 First Half (RMB thousands) | 2020 First Half (RMB thousands) | | :--------------------------------- | :------------------------ | :------------------------ | | Interest income | 75 | 255 | | Income from investment products | 151 | - | | Fair value gains on investment properties | 3,700 | - | | Government grants | 217 | 291 | | Total other income and gains | 4,176 | 1,281 | - Revenue from Customer A was RMB 7,986 thousand and from Customer B was RMB 3,828 thousand in the first half of 2021, both exceeding 10% of total revenue[47] Profit Before Tax and Income Tax For the six months ended June 30, 2021, the Group's profit before tax was RMB 7,399 thousand, primarily influenced by fair value gains on investment properties; income tax expense was RMB 1,220 thousand, mainly comprising PRC current tax and deferred tax 2021 First Half Profit Before Tax Components | Item | 2021 First Half (RMB thousands) | 2020 First Half (RMB thousands) | | :--------------------------------- | :------------------------ | :------------------------ | | Depreciation of property, plant and equipment | 289 | 365 | | Depreciation of right-of-use assets | 178 | 184 | | Amortisation of intangible assets | 45 | 45 | | Impairment of other receivables | 696 | - | | Staff costs | 4,964 | 5,063 | | Fair value gains on investment properties | (3,700) | - | 2021 First Half Income Tax Expense | Tax Type | 2021 First Half (RMB thousands) | 2020 First Half (RMB thousands) | | :------------------------- | :------------------------ | :------------------------ | | Current tax — PRC | 295 | 177 | | Deferred tax | 925 | - | | Total tax expense for the period | 1,220 | 177 | - Certain subsidiaries are designated as small enterprises, applying preferential corporate income tax rates (5% effective tax rate on the first RMB 1,000,000 and 10% effective tax rate on the remaining amount up to RMB 3,000,000)[56] Earnings Per Share and Dividends For the six months ended June 30, 2021, basic earnings per share attributable to ordinary equity holders was 1.78 RMB cents, a significant increase, with no dividends paid or declared during the period Earnings Per Share (As of June 30, 2021) | Metric | 2021 First Half | 2020 First Half | | :------------------------------------------------ | :----------- | :----------- | | Profit attributable to ordinary equity holders of the Company (RMB thousands) | 3,327 | 1,106 | | Number of ordinary shares in issue | 187,430,000 | 187,430,000 | | Basic earnings per share (RMB cents) | 1.78 | 0.65 | | Diluted earnings per share (RMB cents) | 1.78 | 0.65 | - Basic earnings per share is consistent with diluted earnings per share as the Group has no outstanding potential dilutive ordinary shares[60] - No dividends were paid or declared by the Company for the six months ended June 30, 2021[58] Investment Properties and Land Resumption The Group's Chonggu factory was reclassified as non-current assets held for sale at RMB 28 million fair value, generating a RMB 3.7 million gain; a land resumption agreement with the government for RMB 87 million compensation is expected to yield a pre-tax net gain of approximately RMB 54 million Fair Value of Investment Properties | Metric | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------------------------------ | :------------------------- | :-------------------------- | | Investment properties, at fair value | 28,000 | 24,300 | | Less: Reclassified as non-current assets held for sale | (28,000) | - | - The fair value of the Chonggu factory was RMB 28,000,000 as of May 31, 2021, with a fair value adjustment gain of RMB 3,700,000 recognized during the period[63] - The Company has entered into a land resumption agreement with the Qingpu District Chonggu Town House and Land Expropriation Office and the Construction Land Reduction Studio, with total compensation amounting to approximately RMB 87,000,000[69] - The land resumption is expected to result in a pre-tax net gain of approximately RMB 54,000,000, not considering PRC corporate income tax[70] Goodwill and Other Non-Current Assets As of June 30, 2021, the Group's goodwill net book value was RMB 4,211 thousand, consistent with year-end 2020; non-current deposits and other receivables totaled RMB 15,005 thousand, primarily for Tianyi Health Industrial Park property acquisition Goodwill Net Book Value | Metric | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Goodwill net book value | 4,211 | 4,211 | Deposits and Other Receivables Classified as Non-Current Assets | Item | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Deposits paid | 12,817 | 12,817 | | Rental receivables | 2,188 | 2,269 | | Total | 15,005 | 15,086 | - Deposits paid are primarily for the acquisition of six properties in Tianyi Health Industrial Park, Cixi City, Zhejiang Province, China, with a total consideration of approximately RMB 12,817,000, expected to be completed in 2021[75] Trade and Other Receivables and Payables As of June 30, 2021, total trade receivables and bills receivable amounted to RMB 4,830 thousand, with the highest aging concentration within one month; total trade payables were RMB 2,413 thousand, a decrease from year-end 2020 Trade Receivables and Bills Receivable (As of June 30, 2021) | Item | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Trade receivables | 7,308 | 7,308 | | Less: Provision for credit losses | (2,716) | (2,716) | | Bills receivable | 238 | 238 | | Total | 4,830 | 4,830 | Aging Analysis of Trade Receivables (As of June 30, 2021) | Aging | June 30, 2021 (RMB thousands) | | :------------------------- | :-------------------------- | | Within one month | 1,881 | | One to two months | 920 | | Two to three months | 751 | | Three to six months | 801 | | Six to twelve months | 248 | | One to two years | 229 | | Total | 4,830 | Aging Analysis of Trade Payables (As of June 30, 2021) | Aging | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Within one month | 739 | 2,585 | | One to two months | 697 | 496 | | Two to three months | 106 | 261 | | Over three months | 871 | 2,427 | | Total | 2,413 | 5,769 | Assets and Liabilities Held for Sale The Group's Chonggu factory was reclassified as non-current assets held for sale at RMB 28,000 thousand as of June 30, 2021; directly related deferred tax liabilities of RMB 6,575 thousand were also reclassified Assets and Liabilities Held for Sale (As of June 30, 2021) | Item | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :-------------------------------------------------------------------- | :------------------------- | :-------------------------- | | Non-current assets classified as held for sale | 28,000 | - | | Liabilities directly associated with assets classified as held for sale — Deferred tax liabilities | 6,575 | - | - The land resumption agreement for the Chonggu factory is subject to approval by shareholders at the general meeting to be held on August 20, 2021[81] Borrowings and Related Party Transactions As of June 30, 2021, the Group's total secured interest-bearing bank borrowings were RMB 8,298 thousand, primarily for Tianyi property acquisition; related party transactions included directors' emoluments, sales, and testing services, all on normal commercial terms Interest-Bearing Bank Borrowings (As of June 30, 2021) | Item | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Total bank borrowings | 8,298 | 8,747 | | Classified as non-current portion | (7,401) | (7,850) | | Classified as current portion | 897 | 897 | - Bank borrowings are secured by corporate guarantees from the developer and pledges over Tianyi properties, bearing interest at a floating rate of prime rate + 0.25% for a term of 10 years[89] Summary of Related Party Transactions (For the six months ended June 30) | Transaction Type | Related Party | 2021 (RMB thousands) | 2020 (RMB thousands) | | :------------------------- | :------------------- | :------------------ | :------------------ | | Directors' emoluments | Directors | 90 | 90 | | Sales of goods | Zhongliancheng Fire-Fighting Technology | 15 | - | | Testing service income | Shanghai Petrochemical Fire-Fighting Engineering | 18 | 21 | | Key management personnel emoluments | Key management personnel | 261 | 255 | Litigation and Contingent Liabilities The Group faces litigation over leased properties, demanding relocation and land use fee payments; as of June 30, 2021, the Company vacated the property and provisioned RMB 2,000,000 for legal fees, with no other significant contingent liabilities - The Group faces litigation concerning leased properties, where the new owner questioned the validity of the original lease after the former immediate holding company, Huasheng, pledged and had the leased property auctioned[98] - The lawsuit demands the Company vacate the leased property without a property certificate and pay land use fees since 2015; as of June 30, 2021, the Company has vacated the property[99] - The Company has provisioned RMB 2,000,000 for this legal case and related professional fees[99] - As of June 30, 2021, the Group had no significant contingent liabilities[100] Business and Financial Review Financial Performance Analysis For the six months ended June 30, 2021, the Group's revenue grew 22%, driven by aquarium product sales, with gross margin stable at 32%; other income and gains surged 226% from investment property fair value gains; administrative and finance costs increased, yet profit for the period achieved a significant 79% growth 2021 First Half Key Financial Performance Indicators | Metric | 2021 First Half (RMB thousands) | 2020 First Half (RMB thousands) | Year-on-year Change | | :--------------------------------- | :------------------------ | :------------------------ | :------------------ | | Revenue | 35,150 | 28,914 | +22% | | Cost of sales | 23,883 | 19,989 | +20% | | Gross Profit | 11,267 | 8,925 | +26.2% | | Gross Margin | 32% | 31% | +1pp | | Other income and gains | 4,176 | 1,281 | +226% | | Selling and distribution expenses | 1,003 | 690 | +45% | | Administrative expenses | 6,809 | 5,807 | +17% | | Finance costs | 232 | 30 | +673% | | Profit for the period | 6,179 | 3,460 | +79% | - Revenue growth was primarily due to increased sales of aquarium products to overseas distributors resulting from global lockdown measures[103] - The increase in other income and gains was mainly due to fair value gains on investment properties[104] - The increase in administrative expenses was mainly due to impairment of other receivables[105] Assets, Liabilities and Liquidity As of June 30, 2021, the Group's net current assets improved, with a current ratio of 3.4; the gearing ratio decreased to 40%, indicating a more robust financial structure; operations are funded by internal resources, bank borrowings, and equity, supported by a RMB 50 million unsecured, interest-free shareholder loan commitment 2021 First Half Assets, Liabilities and Liquidity Indicators | Metric | June 30, 2021 (RMB thousands) | December 31, 2020 (RMB thousands) | | :------------------------- | :-------------------------- | :-------------------------- | | Current assets | 80,887 | 54,678 | | Current liabilities | 24,101 | 21,757 | | Current Ratio | 3.4 | 2.5 | | Inventory Turnover Days | 167 days | 58 days | | Outstanding bank borrowings | 8,298 | 8,747 | | Gearing Ratio | 40% | 49% | | Net assets | 79,559 | 73,380 | - The increase in current liabilities was mainly due to the reclassification of deferred tax from non-current to current portion[111] - Inventory turnover days increased due to an increase in raw materials and inventory in the second half of the year in preparation for sales[111] - Liancheng, the immediate holding company, committed to provide the Company with an unsecured, interest-free shareholder loan facility of RMB 50,000,000, which remained undrawn at period-end[111] Business Operations Review The Company offers diverse fire-fighting equipment with certifications; the Chonggu factory's land resumption agreement is expected to yield substantial gains, improving cash flow and resource reallocation; subsidiary Shanghai Diye acquired Tianyi Health Industrial Park properties, enhancing aquarium product capacity and sales - The Company's fire-fighting equipment products include carbon dioxide, water-based, and dry powder extinguishers, holding product type approval certificates from the Fire Products Conformity Assessment Center and China Classification Society[113] - The Chonggu factory was included in the Chonggu Town redevelopment plan, and the Company has entered into a land resumption agreement with government authorities for total compensation of approximately RMB 87,000,000[114] - The Directors believe the land resumption will provide additional cash flow, improve working capital, and reallocate idle resources for further development[114] - Subsidiary Shanghai Diye acquired six properties in Tianyi Health Industrial Park, Cixi City, Zhejiang Province, for a total consideration of approximately RMB 12,817,000, enhancing aquarium product capacity and sales[117] Impact of COVID-19 and Future Outlook The COVID-19 pandemic kept the Group's business activities at a minimum, but indirect costs were reduced by leasing out factory premises; the Company anticipates a challenging operating environment and plans to enhance competitive advantage and shareholder value by altering business strategies, exploring new markets, and identifying opportunities from the pandemic - The COVID-19 pandemic kept the Group's business activities at a minimum, but indirect costs were reduced and stable income provided by leasing out the Shanghai High-Pressure Special Gas Cylinder factory[116] - The Company anticipates a challenging post-pandemic economic operating environment and plans to enhance competitive advantage by altering business strategies and exploring new markets for high-margin products/businesses[117] - The Company will carefully identify business opportunities that may arise from the COVID-19 pandemic to enhance shareholder value[117] Shareholders' and Directors' Interests Directors' and Supervisors' Interests in Shares, Underlying Shares and Debentures As of June 30, 2021, Executive Director Mr. Zhou Jinhui held 133,170,000 shares, approximately 71.05% of total issued share capital, through controlled corporations, making him the largest single shareholder Directors' Long Positions in the Company's Shares (As of June 30, 2021) | Name | Capacity | Number of Shares | Approximate Percentage of Total Issued Share Capital | | :----------------- | :------------------- | :---------- | :----------------------------------------- | | Mr. Zhou Jinhui | Held by controlled corporation | 133,170,000 | 71.05% | - Mr. Zhou Jinhui holds an 80% interest in Liancheng through Zhejiang Hengtai, and Liancheng holds 131,870,000 domestic shares and 1,300,000 H shares of the Company[121] - Save as disclosed above, none of the Directors and Supervisors had any other significant interests or short positions in the shares, underlying shares, and debentures of the Company or its associated corporations[122] Major Shareholders' and Other Persons' Interests in Shares, Underlying Shares and Debentures As of June 30, 2021, Liancheng Fire-Fighting Group Co., Ltd., Zhejiang Hengtai Real Estate Co., Ltd., and Mr. Zhou Jinhui were major shareholders, holding approximately 70.36% and 0.69% of shares; Liancheng's 131,870,000 domestic shares are pledged as collateral for a RMB 198,000,000 loan Major Shareholders' Long Positions in the Company's Shares (As of June 30, 2021) | Name | Capacity | Number of Shares | Approximate Percentage of Total Issued Share Capital | | :--------------------------------- | :------------------- | :---------- | :----------------------------------------- | | Liancheng Fire-Fighting Group Co., Ltd. | Beneficial owner | 131,870,000 | 70.36% | | | Held by controlled corporation | 1,300,000 | 0.69% | | Zhejiang Hengtai Real Estate Co., Ltd. | Held by controlled corporation | 131,870,000 | 70.36% | | | Held by controlled corporation | 1,300,000 | 0.69% | | Mr. Zhou Jinhui | Held by controlled corporation | 131,870,000 | 70.36% | | | Held by controlled corporation | 1,300,000 | 0.69% | - The 131,870,000 domestic shares of the Company held by Liancheng Fire-Fighting Group Co., Ltd. have been pledged to an independent third party as collateral for a loan of RMB 198,000,000[128] - The pledged shares represent approximately 70.36% of the Company's issued share capital and 100% of its domestic shares[128] Directors' and Supervisors' Interests in Contracts For the six months ended June 30, 2021, save for related party transactions disclosed in Note 18, no directors or supervisors had any direct or indirect material interest in any significant contract entered into by the Company - Save for related party transactions, no directors or supervisors had any direct or indirect material interest in any significant contract of the Company[131] Other Information Employee Information As of June 30, 2021, the Group had 132 employees, a decrease from 217 in the prior year; remuneration is determined by market levels, performance, qualifications, and experience, with contributions to defined contribution retirement schemes; the Company maintains good employee relations with no significant labor disputes Number of Employees | Date | Number of Employees | | :------------------------- | :------------------ | | June 30, 2021 | 132 | | June 30, 2020 | 217 | - Remuneration is determined by market levels and employee performance, qualifications, and experience, with contributions made to defined contribution retirement schemes[132] - The Company has not experienced any significant labor disputes or strikes and maintains good employee relations[132] Purchase, Sale or Redemption of the Company's Listed Securities For the six months ended June 30, 2021, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the reporting period[133] Dividends The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2021 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2021[134] Corporate Governance The Company complied with all code provisions of the Corporate Governance Code in Appendix 15 of the GEM Listing Rules, committed to responsible decision-making, transparent disclosure, shareholder rights, and improved risk management; the Audit Committee reviewed the Group's unaudited financial statements - The Company has complied with all code provisions of the Corporate Governance Code set out in Appendix 15 to the GEM Listing Rules[136] - The Company has adopted a code of conduct for directors' securities transactions and requires all directors to comply with it[138] - The Audit Committee, comprising three independent non-executive directors, has reviewed the Group's unaudited financial statements for the six months ended June 30, 2021[139]