交大慧谷(08205) - 2020 - 中期财报

Company Overview and Important Notes GEM Listing Features and Directors' Responsibility Statement The report emphasizes GEM's role for SMEs with higher investment risks, stating HKEX disclaims responsibility while directors are fully accountable for content accuracy - GEM market targets SMEs, entailing higher investment risks, potential significant market volatility, and no guaranteed high liquidity[2] - HKEX and the Stock Exchange disclaim responsibility for this report's content, while directors are fully accountable for its accuracy, completeness, and non-misleading nature[2] Summary For H1 2020, the Group's turnover decreased by 27.83% to RMB 11.68 million, while loss attributable to owners increased by 7.35% to RMB 12.44 million, with no interim dividend declared Key Financial Highlights for H1 2020 | Metric | H1 2020 (RMB '000) | H1 2019 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 11,683 | 16,188 | -27.83% | | Loss attributable to owners of the parent | (12,436) | (11,584) | +7.35% | | Interim Dividend | Nil | Nil | - | Financial Statements Condensed Consolidated Statement of Profit or Loss For H1 2020, turnover decreased by 27.83%, gross profit by 16.94%, while loss before tax and loss for the period expanded, resulting in a basic loss per share of RMB 0.0259 Key Data from Condensed Consolidated Statement of Profit or Loss (For the six months ended June 30) | Metric | 2020 (RMB '000) | 2019 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 11,683 | 16,188 | -27.83% | | Cost of sales | (7,748) | (11,450) | -32.33% | | Gross profit | 3,935 | 4,738 | -16.94% | | Other income | 588 | 387 | +51.94% | | Distribution expenses | (6,531) | (8,255) | -20.99% | | Research and development expenses | (2,454) | (2,200) | +11.55% | | Administrative expenses | (5,679) | (7,217) | -21.31% | | Loss before tax | (10,240) | (11,461) | -10.65% | | Share of loss of an associate | (2,196) | (123) | +1685.37% | | Loss for the period | (12,436) | (11,584) | +7.35% | | Loss attributable to owners of the parent | (12,436) | (11,557) | +7.61% | | Basic loss per share (RMB) | (0.0259) | (0.0241) | +7.47% | Condensed Consolidated Statement of Financial Position As of June 30, 2020, total assets less current liabilities reached RMB 63.25 million, with slight increases in non-current assets and significant rises in trade receivables and trade payables Key Data from Condensed Consolidated Statement of Financial Position | Metric | June 30, 2020 (RMB '000) | December 31, 2019 (RMB '000) | Change (RMB '000) | | :--- | :--- | :--- | :--- | | Non-current assets | 19,609 | 17,220 | +2,389 | | Current assets | 64,487 | 57,777 | +6,710 | | Of which: Trade receivables | 18,480 | 12,151 | +6,329 | | Of which: Bank balances and cash | 38,389 | 38,050 | +339 | | Current liabilities | 20,847 | 16,018 | +4,829 | | Of which: Trade payables | 12,150 | 9,375 | +2,775 | | Net current assets | 43,640 | 41,759 | +1,881 | | Net assets | 63,249 | 58,979 | +4,270 | | Total equity | 63,249 | 58,979 | +4,270 | Condensed Consolidated Statement of Changes in Equity Equity attributable to owners of the parent decreased from RMB 75.72 million to RMB 63.28 million for H1 2020, mainly due to a net loss of RMB 12.44 million Changes in Equity Attributable to Owners of the Parent (RMB '000) | Metric | January 1, 2020 | Net loss for the period | June 30, 2020 | | :--- | :--- | :--- | :--- | | Equity attributable to owners of the parent | 75,715 | (12,436) | 63,279 | Condensed Consolidated Statement of Cash Flows For H1 2020, net cash used in operating activities was RMB 12.71 million, investing activities RMB 0.41 million, and financing activities zero, leading to a net decrease of RMB 12.30 million in cash and equivalents Key Data from Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Activity Type | 2020 (RMB '000) | 2019 (RMB '000) | | :--- | :--- | :--- | | Net cash used in operating activities | (12,707) | (13,599) | | Net cash used in investing activities | (411) | (219) | | Net cash used in financing activities | 0 | 0 | | Net decrease in cash and cash equivalents | (12,296) | (13,380) | | Cash and cash equivalents at end of period | 38,389 | 38,050 | Notes to the Financial Statements Basis of Presentation These financial statements are prepared on a going concern basis, adhering to PRC Enterprise Accounting Standards, CSRC, and HKEX Listing Rules - Financial statements are prepared on a going concern basis, adhering to China Enterprise Accounting Standards, CSRC disclosure rules, HKEX Listing Rules, and Hong Kong Companies Ordinance[9] Turnover Analysis Group turnover stems from commercial application solutions, network and data security services, and electronic product sales; H1 2020 saw declines in the first and third categories, but growth in the second - Turnover is primarily generated from developing and providing commercial application solutions and software, installing and maintaining network and data security products, and selling electronic products and accessories[10] Turnover by Business Type (For the six months ended June 30) | Business Type | 2020 (RMB '000) | 2019 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Commercial application solutions and application software | 7,512 | 10,196 | -26.32% | | Installation and maintenance of network and data security products | 2,815 | 2,177 | +29.31% | | Sales of electronic products and accessories | 1,356 | 3,815 | -64.46% | | Total | 11,683 | 16,188 | -27.83% | Segment Information The Group's primary segments are commercial application solutions and sales of goods, all located in China; H1 2020 saw declines in both revenue and segment profit for solutions, and a significant drop in goods sales - The Group's main business segments are commercial application solutions (development and provision of solutions, application software, network, and data security products) and sales of goods (computers, electronic products, and accessories)[13][16] - All Group operations and assets are located in China, hence no geographical segment information is presented[14] Segment Revenue and Profit (For the six months ended June 30) | Segment | 2020 Revenue (RMB '000) | 2019 Revenue (RMB '000) | 2020 Segment Profit (RMB '000) | 2019 Segment Profit (RMB '000) | | :--- | :--- | :--- | :--- | :--- | | Commercial application solutions | 10,327 | 12,373 | 1,856 | 2,538 | | Sales of goods | 1,356 | 3,815 | 213 | 387 | | Total | 11,683 | 16,188 | 2,069 | 2,925 | Components of Loss Before Tax For H1 2020, staff costs (including directors' emoluments) and cost of inventories recognized as an expense decreased, while auditor's remuneration remained constant Deductions for Loss Before Tax (For the six months ended June 30) | Item | 2020 (RMB '000) | 2019 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Staff costs (including directors' emoluments) | 11,255 | 13,857 | -18.78% | | Of which: Salaries, wages and other benefits | 10,339 | 11,574 | -10.72% | | Of which: Contributions to retirement benefit schemes | 916 | 2,283 | -59.88% | | Auditor's remuneration | 180 | 180 | 0% | | Cost of inventories recognized as an expense | 7,748 | 14,037 | -44.81% | Taxation Expense The Group incurred no current taxation expense in H1 2020 or H1 2019, as taxable profits were fully offset by tax losses brought forward, with no Hong Kong profits tax provision - For H1 2020, the Group had no current taxation expense, as taxable profits were fully offset by tax losses brought forward[19][20] - Group income is not generated from or derived in Hong Kong, hence no provision for Hong Kong profits tax[21] - For H1 2020, there were no significant unprovided deferred taxes[21] Dividends The Board declared no interim dividend for H1 2020, consistent with the prior year's corresponding period - The Board declared no interim dividend for H1 2020, consistent with no dividend in H1 2019[24] Loss Per Share Basic loss per share for H1 2020 increased to RMB 0.0259 from RMB 0.0241 in H1 2019, mainly due to a higher net loss for the period Basic Loss Per Share (RMB) | Period | For the six months ended June 30, 2020 | For the six months ended June 30, 2019 | | :--- | :--- | :--- | | Basic loss per share | (0.0259) | (0.0241) | | Net loss | (12,436,000) | (11,584,000) | | Weighted average number of shares | 480,000,000 | 480,000,000 | - Diluted loss per share is not presented due to no potential dilutive ordinary shares outstanding during the reporting period[25] Trade Receivables As of June 30, 2020, total trade receivables increased to RMB 18.48 million from RMB 15.43 million at 2019 year-end, driven by rises in the 0-3 and 7-12 month age categories - The Group's general credit term is 30 to 90 days[26] Ageing Analysis of Trade Receivables (RMB '000) | Ageing | June 30, 2020 | December 31, 2019 | Change | | :--- | :--- | :--- | :--- | | Within 3 months | 5,908 | 4,783 | +1,125 | | 3 to 6 months | 4,567 | 4,236 | +331 | | 7 to 12 months | 5,405 | 3,273 | +2,132 | | Over 1 year | 2,600 | 3,142 | -542 | | Total | 18,480 | 15,434 | +3,046 | Trade Payables As of June 30, 2020, total trade and bills payables increased to RMB 12.05 million from RMB 9.96 million at 2019 year-end, primarily driven by payables within one year Ageing Analysis of Trade and Bills Payables (RMB '000) | Ageing | June 30, 2020 | December 31, 2019 | Change | | :--- | :--- | :--- | :--- | | Within 1 year | 8,070 | 6,970 | +1,100 | | Over 1 year | 3,976 | 2,992 | +984 | | Total | 12,046 | 9,962 | +2,084 | Share Capital As of June 30, 2020, the company's authorized, issued, and fully paid share capital remained at 480 million shares (RMB 48 million total), with no share options granted during the period Share Capital Structure | Metric | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | Number of authorized, issued and fully paid shares | 480,000,000 shares | 480,000,000 shares | | Par value per share | RMB 0.1 | RMB 0.1 | | Total share capital | RMB 48,000,000 | RMB 48,000,000 | - The company has adopted a share option scheme, but no share options were granted during this period[29][30] Comparative Figures Certain comparative figures have been reclassified to align with the current accounting period's presentation - Certain comparative figures have been reclassified to conform with the current accounting period's presentation[31] Management Discussion and Analysis Financial Review For H1 2020, turnover decreased by 27.83% to RMB 11.68 million, gross profit by 10.12% to RMB 3.94 million, and loss for the period increased by RMB 0.85 million to RMB 12.44 million Key Financial Review Data (For the six months ended June 30) | Metric | 2020 (RMB '000) | 2019 (RMB '000) | YoY Change (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Turnover | 11,683 | 16,188 | (4,505) | -27.83% | | Gross profit | 3,935 | 4,378 | (443) | -10.12% | | Loss | 12,436 | 11,584 | 852 | +7.35% | Performance Review and Future Outlook Sales of electronic products and commercial application solutions declined significantly due to COVID-19, while network and data security services grew; the Group will focus on cost control and new market expansion - Sales of electronic products and accessories decreased by 64.46% to RMB 1.36 million, primarily due to the COVID-19 pandemic[34] - Sales of commercial application solutions and software decreased by 26.32% to RMB 7.51 million, primarily due to the COVID-19 pandemic[34] - Sales of network and data security product installation and maintenance increased by 29.31% to RMB 2.82 million[34] - The company will focus on cost control and seek to expand into new market areas through existing client referrals and management's marketing efforts[35] Financial Resources and Liquidity As of June 30, 2020, shareholders' funds were RMB 63.28 million, current assets RMB 64.49 million, and cash RMB 38.39 million, with a current ratio of 309.33% and gearing ratio of 24.79%, deemed healthy by the Board Key Financial Resources and Liquidity Data | Metric | June 30, 2020 (RMB '000) | December 31, 2019 (RMB '000) | Change (RMB '000) | | :--- | :--- | :--- | :--- | | Shareholders' funds | 63,279 | 75,715 | (12,436) | | Current assets | 64,487 | 70,177 | (5,690) | | Bank balances and cash | 38,389 | 35,575 | +2,814 | | Current liabilities | 20,847 | 17,736 | +3,111 | | Net asset value per share (RMB) | 0.13 | 0.16 | (0.03) | | Current ratio | 309.33% | N/A | N/A | | Gearing ratio | 24.79% | 18.98% | +5.81% | - The Directors believe the Group's financial position is very healthy[37] Capital Structure The company's capital structure remained unchanged for the six months ended June 30, 2020 - The company's capital structure experienced no changes during the reporting period[38] Foreign Exchange Risk The Group's monetary assets and transactions are primarily in RMB, HKD, and USD; management notes RMB appreciation but sees no significant adverse impact, monitoring foreign exchange risk without a current hedging policy - Group monetary assets and transactions are primarily settled in RMB, HKD, and USD, with limited exchange rate fluctuations[39] - Management noted RMB appreciation against HKD and USD, but believes there is no significant adverse impact on the financial position currently[39] - The Group currently has no foreign currency hedging policy, but will monitor foreign exchange risk and consider hedging when necessary[39] Employee Information and Remuneration Policy As of June 30, 2020, the Group employed 95 permanent staff (down from 114), with total remuneration (including directors' emoluments) at RMB 10.34 million, based on qualifications, experience, and performance Employee Information and Remuneration | Metric | June 30, 2020 | 2019 | | :--- | :--- | :--- | | Number of permanent staff | 95 persons | 114 persons | | Staff remuneration (including directors' emoluments) | RMB 10,339,000 | RMB 11,574,000 | - Group remuneration and bonus policies are primarily determined by individual employee qualifications, experience, and performance[40] Significant Investments and M&A For H1 2020, the Group had no significant investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures - During the reporting period, the Group had no significant investments[42] - During the reporting period, the Group had no significant acquisitions or disposals of subsidiaries, associates, and joint ventures[43] Treasury Policy The Group's treasury policy aims to control operations, reduce borrowing costs, and maintain sufficient liquidity for short-term financing, with regular Board review and evaluation - The Group's treasury policy aims to effectively control treasury operations and reduce borrowing costs[44] - The Group is committed to maintaining sufficient cash and cash equivalents to meet short-term financing needs[44] - The Board regularly reviews and evaluates the treasury policy to ensure its adequacy and effectiveness[44] Pledge of Assets and Contingent Liabilities As of June 30, 2020, the Group had no pledged assets, significant contingent liabilities, or future plans for major investments or capital assets - As of June 30, 2020, the Group had no pledge of assets[45] - As of June 30, 2020, the Group had no significant contingent liabilities[47] - As of June 30, 2020, the Group had no future plans for significant investments or capital assets[46] Directors', Supervisors' and Chief Executive's Interests As of June 30, 2020, directors, supervisors, and the chief executive held no disclosable interests or short positions in the company's shares or related entities, nor were they granted H-share options - As of June 30, 2020, directors, supervisors, and the chief executive held no disclosable interests or short positions in the company's shares, underlying shares, or debentures of the company or its associated corporations[48] - As of June 30, 2020, directors, supervisors, and the chief executive were not granted any options to subscribe for the company's H shares, nor did they possess any rights to acquire them[50] Major Shareholders' and Other Persons' Interests As of June 30, 2020, several entities including Shanghai Jiao Tong University were major shareholders with 10% or more equity, while Chen Jianbo held 5.06% of domestic shares Major Shareholders' Shareholding (As of June 30, 2020) | Shareholder Name | Capacity and Nature | Number and Class of Shares | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | | Shanghai Jiao Tong University | Interest in controlled corporation | 114,000,000 Domestic Shares (L) | 23.75% | | Shanghai Jiao Tong University Industry Investment Management (Group) Co., Ltd. | Interest in controlled corporation | 114,000,000 Domestic Shares (L) | 23.75% | | Shanghai Jiao Tong University Science Park Co., Ltd. | Beneficial owner | 114,000,000 Domestic Shares (L) | 23.75% | | Shanghai Xuhui (Group) Co., Ltd. | Beneficial owner | 60,000,000 Domestic Shares (L) | 12.50% | | Xuhui District Industrial Federation | Interest in controlled corporation | 60,000,000 Domestic Shares (L) | 12.50% | | Shanghai Feixin Technology Investment and Management Co., Ltd. | Beneficial owner | 57,000,000 Domestic Shares (L) | 11.88% | | Shanghai Science and Technology Venture Capital Co., Ltd. | Beneficial owner | 57,000,000 Domestic Shares (L) | 11.88% | Other Persons' Shareholding (As of June 30, 2020) | Shareholder Name | Capacity and Nature | Number and Class of Shares | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | | Chen Jianbo | Beneficial owner | 24,300,000 Domestic Shares (L) | 5.06% | Competing Interests Directors and management shareholders hold no competing interests in businesses that rival or could rival the Group's operations - Directors and management shareholders hold no interests in businesses that compete or may compete with the Group's operations[56] Corporate Governance During the period, the company complied with GEM Listing Rules on Board practices, directors' securities trading, and corporate governance, with the audit committee reviewing unaudited results - The company consistently complied with Board practices and procedures under GEM Listing Rule 5.34 during the reporting period[57] - The company adopted a code of conduct for directors' and supervisors' securities transactions, with no violations during the reporting period[58] - The audit committee has reviewed the company's unaudited results for the six months ended June 30, 2020[59] - The company consistently complied with the Corporate Governance Code provisions in GEM Listing Rules Appendix 15 during the reporting period[61] - During the reporting period, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities of the company[60] Post-Reporting Period Events and Board Information Significant Events After Reporting Period No significant events affecting the Group occurred after June 30, 2020 - No significant events affecting the Group occurred after June 30, 2020[63] Board of Directors As of the report date, the Board of Directors includes six executive directors and three independent non-executive directors - As of the report date, the Board of Directors comprises six executive directors (Zou Yimin, Shuai Ge, Shang Ling, Hu Lunjie, Xia Weiwei, Shen Zhimin) and three independent non-executive directors (Yuan Shumin, Ni Jing, Zhou Guolai)[64]