港深智能管理(08181) - 2019 - 年度财报

Corporate Information The report details key management personnel, including board members, committee chairs, company secretary, compliance officer, and authorized representatives - The report details key management personnel, including board members, committee chairs (audit, remuneration, nomination), company secretary, compliance officer, and authorized representatives[13] - The company changed its name twice in FY2018/19, from "Kong Shum Union Property Management (Holding) Limited" to "Heng Sheng Holdings Limited", then to "Shi Shi Services Limited"[132][136] - The company's main banks are China Construction Bank (Asia) and DBS Bank (Hong Kong), with ZHONGHUI ANDA CPA Limited serving as the auditor[15] Group Structure Shi Shi Services Limited, an investment holding company registered in the Cayman Islands, serves as the group's parent company, operating through multi-tiered subsidiaries - Shi Shi Services Limited (formerly Heng Sheng Holdings Limited), a Cayman Islands-registered investment holding company, is the ultimate parent company of the Group[22] - The Group operates through multi-tiered wholly-owned subsidiaries across core business segments: - Hong Kong Property Management and Services: Provided through Kong Shum Union Property Management (Group) Limited and its subsidiaries (e.g., Kong Shum Union Property Management Limited, Kiu Wai Security Company Limited) offering property management, security, and cleaning services - Mainland China Business: Provided through Yuelife Network Technology Co., Ltd. and its subsidiaries (e.g., Zibo Yuelife, Shandong Yuelife, Shi Shi Network Technology) offering property management and consulting services in Mainland China - Financial and Other Businesses: Engages in money lending through Lucky Stone Finance Limited and property investment through other subsidiaries[22][24] Chairman's Statement The Group, primarily engaged in property management, property investment, and money lending, achieved a 3.2% revenue increase and 54.1% EPS growth in FY2018/19, driven by strong Mainland China property management growth FY2018/19 Performance Highlights | Indicator | FY2019 (HK$ million) | FY2018 (HK$ million) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 425.7 | 412.3 | +3.2% | | Gross Profit | 103.6 | 94.4 | +9.8% | | Net Profit Margin | 13.5% | 7.5% | +6.0pp | | EPS (HK$) | 0.057 | 0.037 | +54.1% | - The Group primarily engages in property management services, property investment, and money lending business, securing 20 new residential and commercial project management contracts in Hong Kong during the year[28] - Mainland China property management services recorded significant growth, with revenue increasing from HK$9.5 million to HK$27.1 million, becoming a key future growth engine for the Group[32][36] - The Group plans to expand property management businesses in Hong Kong and Mainland China, leveraging internet, IoT, and AI technologies to offer value-added services like community healthcare, elderly care, and education to enhance profitability and shareholder value[31][33][36] Management Discussion and Analysis This section provides an in-depth review of the Group's business operations, financial performance, liquidity, and significant events during the reporting period Business Overview The Group's core businesses include property management (primarily residential), property investment, and money lending, with property management being the main revenue driver - Core businesses include property management, property investment, and money lending, with property management services as the primary revenue source[45] - Money lending business had outstanding loans of approximately HK$18 million as of March 31, 2019, generating interest income of approximately HK$0.2 million for the year, a significant decrease from HK$1.6 million last year[47] - Property investment business performed steadily, generating rental income of approximately HK$1.4 million, a 27.3% year-on-year increase[49] Financial Review In FY2019, total revenue grew 3.2% to HK$425.7 million, driven by strong Mainland China property management growth, with profit attributable to owners increasing 82.0% to HK$52.2 million due to an investment indemnity income FY2019 vs FY2018 Financial Performance Summary | Indicator | 2019 (HK$ thousand) | 2018 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 425,661 | 412,271 | +3.2% | | Gross Profit | 103,648 | 94,399 | +9.8% | | Gross Profit Margin | 24.3% | 22.9% | +1.4pp | | Other Income | 30,129 | 8,384 | +259.4% | | Profit Before Tax | 65,233 | 38,326 | +70.2% | | Profit Attributable to Owners of the Company | 52,229 | 28,695 | +82.0% | | Net Profit Margin | 12.3% | 7.0% | +5.3pp | Revenue Analysis Total revenue increased by 3.2%, primarily driven by significant growth in Mainland China property management services, while Hong Kong property management remained stable and other services declined Revenue Breakdown by Business Segment | Business Segment | 2019 (HK$ million) | % of Total | 2018 (HK$ million) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Hong Kong Property Management Services | 367.1 | 86.2% | 366.9 | 89.0% | | Property Security Services | 29.9 | 7.0% | 33.2 | 8.1% | | Mainland China Property Management Services | 27.1 | 6.4% | 9.5 | 2.2% | | Leasing Services | 1.4 | 0.3% | 1.1 | 0.3% | | Money Lending Services | 0.2 | 0.1% | 1.6 | 0.4% | | Total | 425.7 | 100% | 412.3 | 100% | - Revenue growth was primarily driven by a significant 185.2% increase in Mainland China property management services revenue, from HK$9.5 million to HK$27.1 million[58][60] Gross Profit Analysis Gross profit increased by 9.8% to HK$103.6 million, with the gross profit margin improving to 24.3%, primarily due to effective cost control and service fee adjustments - Gross profit increased by 9.8% year-on-year, with the gross profit margin improving from 22.9% to 24.3%[66][69] - Cost of services saw a modest 1.3% year-on-year increase, mainly due to higher frontline staff salaries, indicating effective cost control that contributed to the improved gross profit margin[65][68] Profit Attributable to Owners of the Company Analysis Profit attributable to owners of the company surged by 82.0% to HK$52.2 million, with the net profit margin rising to 12.3%, mainly due to a HK$26 million indemnity income from an investment - Profit attributable to owners of the company increased significantly by 82.0% year-on-year, with the net profit margin improving by 5.3 percentage points to 12.3%[74][78] - The primary driver for the profit increase was an indemnity income of approximately HK$26 million received from the investment in All Profit Alliance Limited (2018: nil)[75][78] Liquidity, Financial Resources and Capital Structure As of March 31, 2019, the Group maintained a healthy financial position with strong liquidity, evidenced by a significant increase in net current assets and cash, and a low gearing ratio Financial Position and Key Ratios | Indicator | March 31, 2019 | March 31, 2018 | | :--- | :--- | :--- | | Net Current Assets (HK$ thousand) | 185,640 | 98,558 | | Bank Balances and Cash (HK$ thousand) | 142,200 | 54,165 | | Total Equity (HK$ thousand) | 289,127 | 196,076 | | Return on Equity (ROE) | 23.7% | 19.8% | | Return on Assets (ROA) | 17.6% | 13.0% | | Current Ratio | 3.08 times | 2.30 times | | Gearing Ratio | 4.4% | 9.1% | | Net Debt to Equity Ratio | 0% | 0% | | Trade Receivables Turnover Days | 53.3 days | 43.3 days | | Trade Payables Turnover Days | 41.5 days | 26.0 days | - The improvement in the current ratio was primarily due to an increase in cash and cash equivalents, partially offset by the repayment of approximately HK$7.7 million in acceptance bills[89][96] - Trade receivables turnover days increased from 43.3 days to 53.3 days, indicating a longer collection period for trade receivables[92][99] Operation Review During the fiscal year, the Group expanded its workforce to 2,021 employees, secured 437 Hong Kong service contracts, completed two company name changes, and undertook significant transactions including a share placement, an acquisition, and the resolution of a trademark lawsuit - As of March 31, 2019, the Group's total number of employees increased to 2,021 (2018: 1,965), with staff costs amounting to approximately HK$349.3 million[105] - A new share placement was completed in November 2018, raising net proceeds of approximately HK$40.4 million from the placement of 171 million shares at HK$0.24 per share, intended for Mainland China business expansion and working capital[113][140] - The company received an indemnity settlement of HK$26 million in January 2019 due to All Profit's failure to meet profit guarantees[127] - The company reached a settlement with Hang Seng Bank regarding a "Hang Seng" trademark infringement lawsuit, which had no material adverse impact on the Group's financial position or operations[129] - On March 29, 2019, the company acquired Shi Shi Property (Cayman) Limited and its subsidiaries for HK$8 million in cash to expand its property management services business in Shandong Province, Mainland China[134] Biographies of Directors and Senior Management The Board comprises three executive directors, one non-executive director, and three independent non-executive directors, with members possessing extensive professional experience in various relevant fields - The Board of Directors consists of 3 executive directors, 1 non-executive director, and 3 independent non-executive directors; Mr. Wong Lai Ming serves as the non-executive director and Chairman of the Board, also being the controlling shareholder of the company[146][150][152] - Board members and senior management possess extensive professional experience and backgrounds in property management, real estate investment, finance, accounting, and legal fields[146][148][153] Corporate Governance Report This report outlines the Group's corporate governance practices, including compliance with the Corporate Governance Code, the structure and functions of the Board, and its various committees Compliance with the Corporate Governance Code The company largely complied with the Corporate Governance Code, with two deviations: no CEO position and an independent non-executive director's absence from the 2018 AGM - The company has not formally established a Chief Executive Officer (CEO) position, with daily operations jointly overseen by executive directors and senior management; the Board believes the current structure ensures effective management[176] - Independent Non-executive Director Mr. Lo Chi Ho was unable to attend the Annual General Meeting held on July 31, 2018, due to other commitments[179] Board and Committees The Board, composed of seven diverse directors, held 19 meetings, supported by audit, remuneration, nomination, and compliance committees, each fulfilling its duties with relevant expertise Board and Committee Meeting Attendance Record (FY2019) | Director | Board | Audit Committee | Remuneration Committee | Nomination Committee | | :--- | :--- | :--- | :--- | :--- | | Dar Zhenbiao | 16/19 | N/A | N/A | N/A | | Ho Ying Choi | 19/19 | N/A | 3/4 | 1/1 | | Li Chin Ching | 19/19 | N/A | N/A | N/A | | Wong Lai Ming | 19/19 | N/A | N/A | N/A | | Cho Siu Lun | 9/19 | 4/4 | 4/4 | 1/1 | | Lam Kai Yeung | 19/19 | 4/4 | 4/4 | 1/1 | | Lo Chi Ho | 14/19 | 4/4 | 2/4 | 1/1 | - The Audit Committee comprises three independent non-executive directors, chaired by Mr. Lam Kai Yeung, and held 4 meetings during the year to review annual and quarterly financial results[218] - The Remuneration Committee consists of one executive director and three independent non-executive directors, chaired by Mr. Lam Kai Yeung, and held 4 meetings during the year to review directors' and senior management's remuneration[224][225] Directors' Report This report covers the Board's recommendations on dividends, details of the controlling shareholder, major customers and suppliers, and confirms no share repurchases during the period - The Board does not recommend the payment of any dividend for the year ended March 31, 2019[264] - As of March 31, 2019, the controlling shareholder, Heng Sheng Capital Limited (wholly owned by Chairman Mr. Wong Lai Ming), held 626,071,950 shares, representing 61.00% of the company's issued share capital[136][316] - During the year, the top five customers collectively accounted for approximately 13.00% of total sales, with the largest customer contributing 3.6%; the top five suppliers collectively accounted for approximately 94.5% of total purchases, with the largest supplier contributing 43.6%[330][333] - Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the reporting period[280] Environmental, Social and Governance Report This report outlines the Group's commitment to environmental protection, employee welfare, and ethical governance, detailing performance in resource usage, emissions, workforce management, and anti-corruption efforts Environment The Group is committed to environmental protection through a "smart use" culture, reporting total greenhouse gas emissions of 381 tonnes of CO2e and total energy consumption of 2,164 gigajoules 2018-2019 Environmental Key Performance Indicators (KPIs) | Category | Indicator | Unit | 2018–2019 | | :--- | :--- | :--- | :--- | | Energy Consumption | Total Energy Consumption | Gigajoules | 2,164 | | | Electricity Consumption | kWh | 486,157 | | GHG Emissions | Total Emissions (Scope 1+2+3) | tonnes of CO2 equivalent | 381 | | | Scope 1 - Direct Emissions | tonnes of CO2 equivalent | 35 | | | Scope 2 - Energy Indirect Emissions | tonnes of CO2 equivalent | 306 | | Waste Management | Total Non-Hazardous Waste | tonnes | 6.6 | | Resource Use | Water Consumption | cubic meters | 647 | Social The Group prioritizes employee well-being, employing 2,021 staff, offering competitive compensation, and focusing on occupational health, equal opportunities, and anti-corruption, with significant training hours provided - As of March 31, 2019, the Group employed a total of 2,021 staff, comprising 266 management and general staff and 1,755 security personnel; the annual turnover rate for management and general staff was 57%, and for security personnel was 117%[407] Employee Training Hours Statistics | Employee Category | Number of Employees Trained | Total Training Hours | | :--- | :--- | :--- | | Management and General Staff | 266 | 1,050 | | Security Personnel | 1,755 | 10,530 | - During the reporting period, the Group recorded 32 work-related injury cases resulting in lost workdays, but no major safety incidents or violations[428] - The Group strictly adheres to anti-corruption regulations and has issued "Anti-Corruption Measures for Accounting, Security, Engineering, and Property Management" guidelines to employees; no non-compliance related to corruption or bribery was found during the reporting period[441] Independent Auditor's Report ZHONGHUI ANDA CPA Limited issued an unqualified opinion on the Group's FY2019 consolidated financial statements, affirming their fair presentation and compliance with HKFRS and Hong Kong Companies Ordinance - The auditor, ZHONGHUI ANDA CPA Limited, issued an unqualified opinion on the company's FY2019 consolidated financial statements, affirming that they present a true and fair view of the Group's financial position, performance, and cash flows, and are properly prepared in accordance with Hong Kong Financial Reporting Standards and the disclosure requirements of the Hong Kong Companies Ordinance[453][455] - The report identified three key audit matters: - Investment Properties: Involving significant judgments and estimates in fair value measurement - Trade Receivables: Involving significant judgments and estimates in impairment testing - Investment in an Associate: Involving significant judgments and estimates in impairment testing[458][460][463] Audited Financial Statements This section presents the Group's audited financial statements, including the consolidated statement of profit or loss, financial position, and cash flows, providing a detailed view of its financial performance and health Consolidated Statement of Profit or Loss and Other Comprehensive Income For the year ended March 31, 2019, the Group reported revenue of HK$425.7 million, an 85.3% increase in profit for the year to HK$57.38 million, and an 82.0% increase in profit attributable to owners to HK$52.23 million Consolidated Statement of Profit or Loss Key Data | Item (HK$) | 2019 | 2018 | | :--- | :--- | :--- | | Revenue | 425,660,545 | 412,270,727 | | Gross Profit | 103,647,975 | 94,398,857 | | Profit Before Tax | 65,233,485 | 38,326,490 | | Profit for the Year | 57,380,097 | 30,962,956 | | Profit Attributable to Owners of the Company | 52,228,674 | 28,694,621 | | Total Comprehensive Income for the Year | 58,027,213 | 31,136,216 | | Basic Earnings Per Share (HK$) | 0.057 | 0.037 | Consolidated Statement of Financial Position As of March 31, 2019, total assets reached HK$378.7 million, with net assets increasing 47.5% to HK$289.1 million, driven by a significant rise in cash and cash equivalents Consolidated Statement of Financial Position Key Data | Item (HK$) | March 31, 2019 | March 31, 2018 | | :--- | :--- | :--- | | Non-current Assets | 103,955,565 | 97,821,582 | | Current Assets | 274,760,280 | 174,636,442 | | Of which: Cash and Cash Equivalents | 142,200,011 | 54,164,638 | | Total Assets | 378,715,845 | 272,458,024 | | Current Liabilities | 89,119,624 | 76,077,766 | | Non-current Liabilities | 468,731 | 304,165 | | Total Liabilities | 89,588,355 | 76,381,931 | | Net Assets | 289,127,490 | 196,076,093 | | Total Equity | 289,127,490 | 196,076,093 | Consolidated Statement of Cash Flows For the year ended March 31, 2019, net cash from operating activities was HK$14.38 million, with significant cash inflows from investing activities (HK$42.72 million) and financing activities (HK$27.92 million), leading to a substantial increase in year-end cash balance Consolidated Statement of Cash Flows Key Data | Item (HK$) | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 14,384,147 | 8,582,580 | | Net Cash Flow from Investing Activities | 42,722,662 | (22,568,207) | | Net Cash Flow from Financing Activities | 27,917,186 | 27,047,568 | | Net Increase in Cash and Cash Equivalents | 85,023,995 | 13,061,941 | | Cash and Cash Equivalents at Beginning of Year | 54,164,638 | 41,035,127 | | Cash and Cash Equivalents at End of Year | 139,558,777 | 54,164,638 | Five Year Financial Summary This section provides a five-year overview of the Group's financial performance, including key income statement and balance sheet figures, illustrating trends in revenue, profit, assets, and liabilities Five-Year Performance Summary (HK$ thousand) | Item | 2019 | 2018 | 2017 | 2016 | 2015 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 425,661 | 412,271 | 395,514 | 374,024 | 339,722 | | Gross Profit | 103,648 | 94,399 | 83,308 | 78,268 | 70,442 | | Profit Before Tax | 65,233 | 38,326 | 13,508 | 5,956 | 7,294 | | Net Profit for the Year | 57,380 | 30,963 | 10,188 | 2,815 | 4,974 | Five-Year Assets and Liabilities Summary (HK$ thousand) | Item | 2019 | 2018 | 2017 | 2016 | 2015 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 378,716 | 272,458 | 203,395 | 144,871 | 100,563 | | Total Liabilities | (89,589) | (76,381) | (87,125) | (56,529) | (61,276) | | Net Assets | 289,127 | 196,077 | 116,270 | 88,342 | 39,287 |