泰锦控股(08321) - 2021 Q3 - 季度财报

Company Information The company's board includes executive and independent non-executive directors, with a company secretary and auditor, and registered in the Cayman Islands with a Hong Kong principal place of business - The Board of Directors includes executive directors Ms. Xu Zihua (Chairperson and Chief Executive Officer) and Ms. Liu Tanying, and independent non-executive directors Ms. Li Yixuan and Mr. Liu Hongli (Mr. Yan Jianping has resigned)[4] - The Company Secretary is Mr. Xu Zhigang, and the auditor is Kaiyuan Xinde Certified Public Accountants Limited[4] - The company's registered office is in the Cayman Islands, with its principal place of business in Hong Kong located at Kai Tak Commercial Building, Des Voeux Road Central[4] Financial Highlights This section provides a summary of the company's key financial performance indicators for the nine months ended January 31, 2021 As at January 31, 2021 Financial Highlights | Indicator | For the nine months ended January 31, 2021 (HK$ million) | For the nine months ended January 31, 2020 (HK$ million) | Change (%) | | :--- | :----------------------------------------------- | :----------------------------------------------- | :------- | | Revenue | 82.9 | 158.9 | -47.8% | | Loss attributable to equity holders | 1.5 | 2.9 | -48.3% | | Basic and diluted loss per share | 0.85 HK cents | 1.79 HK cents | -52.5% | - The Board does not recommend the payment of an interim dividend for the nine months ended January 31, 2021 (2020: nil)[7] Management Discussion and Analysis This section reviews the company's business operations, financial performance, and future outlook, addressing challenges and strategies Business Review and Outlook The group focuses on Hong Kong construction, facing cost and competition challenges, and is exploring new markets and business diversification - The Group primarily engages in construction business in Hong Kong, including site formation works (such as landslide prevention and repair works) and fitting-out works[9] - Facing increasing operating costs (including direct labor costs and subcontracting fees), intense market competition, and potential delays in construction projects due to demonstrations and the coronavirus outbreak[9] - The Board is actively taking measures to develop business in other markets in the Asia-Pacific region (including but not limited to Japan, Thailand, and Singapore), and is committed to diversifying its business scope, such as property design and construction, and investing in potential properties to benefit from capital appreciation and generate stable rental income[9] Financial Review The group experienced a significant decline in revenue and gross profit, partially offset by reduced administrative expenses and increased other income Revenue The group's revenue decreased by 47.8% to HK$82.9 million, primarily due to reduced fitting-out works in Hong Kong - Revenue refers to amounts received for providing construction services in site formation and fitting-out works in Hong Kong[11] Revenue Change | Period | Revenue (HK$ million) | Year-on-year Change (HK$ million) | Year-on-year Change (%) | | :--- | :-------------------- | :-------------------------------- | :---------------------- | | For the nine months ended January 31, 2021 | 82.9 | -76.0 | -47.8% | | For the nine months ended January 31, 2020 | 158.9 | | | - The decrease in revenue was primarily due to a reduction in fitting-out works undertaken in Hong Kong for the nine months ended January 31, 2021[11] Gross Profit and Gross Margin Gross profit significantly decreased by 78.5% to HK$1.7 million, with gross margin falling from 5.0% to 2.0% Gross Profit and Gross Margin Change | Indicator | For the nine months ended January 31, 2021 | For the nine months ended January 31, 2020 | Change (%) | | :--- | :--------------------------------------- | :--------------------------------------- | :------- | | Gross Profit (HK$ million) | 1.7 | 7.9 | -78.5% | | Gross Margin (%) | 2.0% | 5.0% | -60.0% | - The decrease in gross margin was mainly due to the decrease in revenue for the nine months ended January 31, 2021[14] - Direct costs decreased by 46.2% to approximately HK$81.3 million, primarily due to reduced subcontracting fees and labor costs from projects heavily utilizing subcontractors and labor[14] Other Income Other income was approximately HK$5.3 million, mainly from government subsidies and fair value changes of financial assets - For the nine months ended January 31, 2021, the Group's other income was approximately HK$5.3 million[15] - Mainly comprising income from government subsidies of approximately HK$1.4 million and fair value changes of financial assets at fair value through profit or loss of approximately HK$3.7 million[15] Administrative Expenses Administrative expenses decreased by 21.9% to HK$8.2 million, primarily due to reduced staff costs and professional fees Administrative Expenses Change | Period | Administrative Expenses (HK$ million) | Year-on-year Change (HK$ million) | Year-on-year Change (%) | | :--- | :---------------------------------- | :-------------------------------- | :---------------------- | | For the nine months ended January 31, 2021 | 8.2 | -2.3 | -21.9% | | For the nine months ended January 31, 2020 | 10.5 | | | - The decrease in administrative expenses was primarily due to reduced administrative staff costs and professional fees for the nine months ended January 31, 2021[16] Finance Costs Finance costs were approximately HK$213,000, mainly from interest on advances from a company Finance Costs Change | Period | Finance Costs (HK$) | | :--- | :------------------ | | For the nine months ended January 31, 2021 | 213,000 | | For the nine months ended January 31, 2020 | 197,000 | - Finance costs primarily refer to interest expenses arising from advances paid to a company for the nine months ended January 31, 2021[18] Net Loss The company's net loss narrowed to HK$1.5 million, primarily due to lower administrative expenses and higher other income Net Loss Change | Period | Net Loss (HK$ million) | | :--- | :--------------------- | | For the nine months ended January 31, 2021 | 1.5 | | For the nine months ended January 31, 2020 | 2.9 | - The decrease in net loss was primarily due to reduced revenue and gross profit, partially offset by lower administrative expenses and increased other income for the nine months ended January 31, 2021[19] Other Information This section details directors' and major shareholders' interests, competing interests, securities transactions, dividends, and other corporate information Interests and Short Positions of Directors and Chief Executive in Shares, Underlying Shares, and Debentures of the Company or Associated Corporations As of January 31, 2021, the company's directors and chief executive primarily held long positions in shares and underlying shares through unlisted share options Directors' and Chief Executive's Long Positions in Shares and Underlying Shares of the Company (As at January 31, 2021) | Director | Number of Ordinary Shares/Underlying Shares (Unlisted Share Options) | Total | Percentage of the Company's Issued Share Capital | | :--- | :----------------------------------------------- | :--- | :--------------------------------------- | | Ms. Xu Zihua | 3,200,000 | 3,200,000 | 1.67% | | Ms. Liu Tanying | 3,200,000 | 3,200,000 | 1.67% | | Mr. Liu Hongli | 1,600,000 | 1,600,000 | 0.83% | - Save as disclosed above, none of the Company's directors or chief executive had any disclosable interests or short positions in the shares, underlying shares, or debentures of the Company or any of its associated corporations[22] Interests and Short Positions of Substantial Shareholders and Other Persons in Shares and Underlying Shares of the Company As of January 31, 2021, no substantial shareholders or other persons had notified the company of any disclosable interests or short positions in its shares or underlying shares - As of January 31, 2021, no person had informed the Company of any interests or short positions in the shares or underlying shares of the Company that were required to be recorded in the register kept by the Company under Section 336 of the Securities and Futures Ordinance, or to be disclosed under Divisions 2 and 3 of Part XV of the Securities and Futures Ordinance[23] Competing Interests Directors and their close associates confirmed no interests in businesses competing with the group, other than the group's own business - The directors and their respective close associates confirmed that, save for the Group's business, none of them had any interests in businesses that compete or are likely to compete, either directly or indirectly, with the Group's business[24] Purchase, Sale or Redemption of the Company's Listed Securities Neither the company nor its subsidiaries purchased, sold, or redeemed any of its listed securities during the nine months ended January 31, 2021 - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the nine months ended January 31, 2021, and up to the date of this report[25] Code of Conduct Regarding Securities Transactions by Directors The group adopted a code of conduct for directors' securities transactions, no less exacting than GEM Listing Rules, with all directors confirming compliance - The Group has adopted a code of conduct for directors' securities transactions with terms no less exacting than the required standards of dealings set out in Rules 5.48 to 5.67 of the GEM Listing Rules[26] - Following specific enquiries made to the directors, all directors have confirmed that they have complied with the required standards set out in the code of conduct for the nine months ended January 31, 2021, and up to the date of this report[26] Dividends The Board does not recommend the payment of an interim dividend for the nine months ended January 31, 2021 - The Board does not recommend the payment of an interim dividend for the nine months ended January 31, 2021 (2020: nil)[27] Material Investments As of January 31, 2021, the group held no material investments exceeding 5% of its total assets - As the Group did not hold any investments with a value exceeding 5% of the Group's total assets, the Group held no material investments as of January 31, 2021[30] Events After Reporting Period As of the report date, the group had no material events after the reporting period other than those disclosed - Save as disclosed, there were no material events after the reporting period for the Group up to the date of this report[31] Share Option Scheme The company adopted a share option scheme in 2016, granting significant options to directors and other grantees at an exercise price of HK$0.12 per share - The Company conditionally adopted a share option scheme on September 26, 2016, with terms in compliance with the GEM Listing Rules[32] Details of Outstanding Share Options as at January 31, 2021 | Grantee | As at May 1, 2020 | Granted during the period | Exercised during the period | Lapsed during the period | As at January 31, 2021 | Date of grant during the period | Exercise price per share | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Ms. Xu Zihua | 1,600,000 | 1,600,000 | – | – | 3,200,000 | September 30, 2020 | HK$0.12 | | Ms. Liu Tanying | 1,600,000 | 1,600,000 | – | – | 3,200,000 | September 30, 2020 | HK$0.12 | | Mr. Liu Hongli | – | 1,600,000 | – | – | 1,600,000 | September 30, 2020 | HK$0.12 | | Ms. Li Yixuan | – | 1,600,000 | – | – | 1,600,000 | September 30, 2020 | HK$0.12 | | Other Grantees | 3,200,000 | 9,600,000 | – | – | 12,800,000 | September 30, 2020 | HK$0.12 | | Total | 6,400,000 | 16,000,000 | – | – | 22,400,000 | | | - The closing price of the Company's shares immediately before the date of grant of share options on September 30, 2020, was HK$0.12[36] Audit Committee The Audit Committee reviewed the unaudited financial statements for the nine months ended January 31, 2021, confirming compliance with accounting standards and GEM Listing Rules - The Audit Committee was established on September 26, 2016, with written terms of reference in compliance with the GEM Listing Rules[38] - The Audit Committee currently comprises two independent non-executive directors, namely Mr. Liu Hongli (Chairman) and Ms. Li Yixuan[38] - The Audit Committee has reviewed the Group's unaudited financial statements for the nine months ended January 31, 2021, with management and is of the opinion that the results comply with applicable accounting standards, the requirements of the GEM Listing Rules, and other applicable legal requirements, and that adequate disclosures have been made[38] Condensed Consolidated Statement of Comprehensive Income (Unaudited) This statement presents the group's unaudited financial performance, including revenue, costs, and net loss, for the nine months ended January 31, 2021 Condensed Consolidated Statement of Comprehensive Income Summary (For the nine months ended January 31) | Indicator | 2021 (HK$ thousand) | 2020 (HK$ thousand) | | :--- | :------------------ | :------------------ | | Revenue | 82,929 | 158,934 | | Direct costs | (81,266) | (151,012) | | Gross profit | 1,663 | 7,922 | | Other income | 5,315 | – | | Administrative expenses | (8,237) | (10,507) | | Finance costs | (213) | (197) | | Loss/(Profit) before income tax | (1,472) | (2,782) | | Income tax expense | (15) | (85) | | Total comprehensive income/(expense) for the period attributable to equity holders of the Company | (1,487) | (2,867) | | Basic and diluted loss/(earnings) per share (HK cents) | (0.85) | (1.79) | - For the nine months ended January 31, 2021, revenue decreased by 47.8% year-on-year, and gross profit decreased by 78.9% year-on-year[39] - Total comprehensive expense for the period attributable to equity holders of the Company narrowed from HK$2,867 thousand in 2020 to HK$1,487 thousand in 2021, indicating an improvement in loss[39] Condensed Consolidated Statement of Changes in Equity (Unaudited) This statement outlines the changes in the group's equity components, including share capital, share premium, and retained earnings, for the nine months ended January 31, 2021 Condensed Consolidated Statement of Changes in Equity Summary (For the nine months ended January 31, 2021) | Item | Share Capital (HK$ thousand) | Share Premium (HK$ thousand) | Share Option Reserve (HK$ thousand) | Capital Reserve (HK$ thousand) | Retained Earnings (HK$ thousand) | Total (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Balance as at May 1, 2020 | 8,000 | 54,718 | 753 | 10,101 | 37,105 | 110,677 | | Placement of shares during the period | 1,600 | 1,709 | – | – | – | 3,309 | | Share options granted during the period | – | – | 1,241 | – | – | 1,241 | | Total comprehensive income/(expense) for the period | – | – | – | – | (1,487) | (1,487) | | Balance as at January 31, 2021 | 9,600 | 56,427 | 1,994 | 10,101 | 35,618 | 113,740 | - As of January 31, 2021, total equity increased to HK$113,740 thousand, primarily influenced by the placement of shares and share options granted during the period[41] - Placement of shares during the period resulted in an increase of HK$3,309 thousand in share capital and share premium, and share option reserve increased by HK$1,241 thousand[41] Notes to the Unaudited Condensed Consolidated Financial Statements These notes provide detailed explanations and disclosures for the unaudited condensed consolidated financial statements, covering general information, accounting policies, and financial items General Information Tai Kam Holdings Limited, an investment holding company listed on GEM, primarily engages in site formation and fitting-out works in Hong Kong - Tai Kam Holdings Limited was incorporated in the Cayman Islands as an exempted company on April 1, 2016[43] - The Company is an investment holding company, and together with its subsidiaries, is principally engaged in site formation works and fitting-out works in Hong Kong, and investment holding[43] - The Company's shares were listed on GEM of the Stock Exchange on October 28, 2016[44] Basis of Preparation and Reorganisation The unaudited condensed consolidated financial statements are presented in HKD, prepared under HKFRS and GEM Listing Rules, with consistent accounting policies and no significant impact from new standards - These unaudited condensed consolidated financial statements have been prepared in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the GEM Listing Rules[45] - These unaudited condensed consolidated financial statements are presented in HK$ and prepared on a historical cost basis[45][46] - The adoption of new and revised standards, amendments, and interpretations has had no significant impact on the Group's operating results or financial position[46] Revenue and Segment Information The group's revenue is from Hong Kong site formation and fitting-out works, treated as a single operating segment, with significant reliance on a few key customers - Revenue refers to amounts received for construction services in site formation and fitting-out works in Hong Kong[47] - The chief operating decision maker regards the Group's construction business in Hong Kong as a single operating segment, and no segment analysis information or separate analysis of segment information by geographical segment is presented[48][49] Major Customer Revenue (For the nine months ended January 31) | Customer | 2021 (HK$ thousand) | 2020 (HK$ thousand) | | :--- | :------------------ | :------------------ | | Customer A | 97 | 14,126 | | Customer B | 63,204 | 58,652 | | Customer C | 196 | 7,257 | | Customer D | – | 58,453 | | Customer E | 7,872 | 20,447 | | Customer F | 11,560 | – | Other Income Other income totaled HK$5,315 thousand, primarily from government grants and fair value changes of financial assets at fair value through profit or loss Other Income Details (For the nine months ended January 31) | Item | 2021 (HK$ thousand) | 2020 (HK$ thousand) | | :--- | :------------------ | :------------------ | | Gain on disposal of plant and equipment | 133 | – | | Government grants | 1,426 | – | | Fair value change of financial assets at fair value through profit or loss | 3,741 | – | | Others | 15 | – | | Total | 5,315 | – | Finance Costs Finance costs were HK$213 thousand, mainly comprising interest expenses on other borrowings Finance Costs Details (For the nine months ended January 31) | Item | 2021 (HK$ thousand) | 2020 (HK$ thousand) | | :--- | :------------------ | :------------------ | | Interest on bank overdrafts | 3 | – | | Interest on lease liabilities | 13 | – | | Interest expense on other borrowings | 197 | 197 | | Total | 213 | 197 | Profit/(Loss) Before Income Tax Profit/(Loss) before income tax is presented after deducting staff costs of HK$9,222 thousand and subcontracting expenses of HK$73,028 thousand Staff Costs (For the nine months ended January 31) | Item | 2021 (HK$ thousand) | 2020 (HK$ thousand) | | :--- | :------------------ | :------------------ | | Salaries, wages and other benefits | 9,009 | 14,609 | | Contributions to defined contribution retirement plans | 213 | 385 | | Total | 9,222 | 14,994 | - Other deductions include depreciation of plant and equipment of HK$974 thousand, depreciation of right-of-use assets of HK$533 thousand, and subcontracting expenses of HK$73,028 thousand recognized in direct costs[55] - Fair value change of financial assets at fair value through profit or loss was negative HK$3,741 thousand (gain)[55] Income Tax Expense Income tax expense was HK$15 thousand, representing Hong Kong profits tax, with no deferred tax provision due to no significant temporary differences Income Tax Expense (For the nine months ended January 31) | Item | 2021 (HK$ thousand) | 2020 (HK$ thousand) | | :--- | :------------------ | :------------------ | | Current tax – Hong Kong Profits Tax | 15 | 85 | - The Hong Kong Profits Tax two-tiered rates regime stipulates that qualifying corporations are taxed at 8.25% on the first HK$2 million of profits and 16.5% on profits above HK$2 million[58] - No deferred tax provision has been made in the unaudited condensed consolidated financial statements as there were no significant temporary differences during the reporting period[59] Dividends The directors do not recommend the payment of an interim dividend for the nine months ended January 31, 2021 - The directors do not recommend the payment of an interim dividend for the nine months ended January 31, 2021 (2020: nil)[60] Loss/(Earnings) Per Share Basic and diluted loss per share was HK$0.85 cents, adjusted for the share consolidation completed in July 2020 Loss/(Earnings) Per Share (For the nine months ended January 31) | Indicator | 2021 (HK cents) | 2020 (HK cents) | | :--- | :-------------- | :-------------- | | Basic and diluted loss/(earnings) per share | (0.85) | (1.79) | - The weighted average number of ordinary shares was 174,261 thousand (2020: 160,000 thousand), adjusted for the share consolidation (five shares consolidated into one) completed on July 15, 2020[61] - As there were no dilutive potential ordinary shares for the periods ended January 31, 2021, and 2020, the diluted loss per share was equal to the basic loss per share[62]