Financial Performance - The company reported a challenging year in 2019, impacted by the outbreak of swine flu, which shifted the sales mix from pork to chicken, resulting in a decrease in profit margins[9]. - The company recorded revenue of approximately HKD 135 million for the year ended December 31, 2019, a decrease of about 0.7% compared to approximately HKD 136 million in the same period last year[16]. - The cost of consumed inventory was approximately HKD 90.8 million, resulting in an operating loss before tax of approximately HKD 8.4 million, compared to a profit of approximately HKD 5.3 million in the previous year[17]. - The company's net loss for the year ended December 31, 2019, was approximately HKD 9.3 million, compared to a profit of approximately HKD 3.6 million in the previous year[21]. - As of December 31, 2019, the company's distributable reserves amounted to approximately HKD 104,454,000, a slight decrease from HKD 105,416,000 in 2018[61]. - The group reported a loss for the year ended December 31, 2019, with financial details available on pages 47 to 123 of the financial statements[59]. - The company does not recommend the payment of any final dividend for the year ended December 31, 2019[60]. Capital and Investments - The company successfully raised approximately HKD 39.9 million through the issuance of 350,000,000 shares at HKD 0.2 per share during its listing on June 30, 2017[11]. - As of December 31, 2019, the actual use of funds from the IPO totaled HKD 39.1 million, with significant allocations including HKD 22.0 million for acquiring new premises and HKD 8.8 million for renovating properties for refrigeration equipment[13]. - The company completed the acquisition of two properties and renovated them during the review period[15]. - The company sold two properties for a total consideration of approximately HKD 45.5 million, which is planned to be used for repaying certain bank financing[37]. - The company has maintained a prudent treasury policy to manage liquidity risks and ensure sufficient cash flow[27]. Business Strategy and Operations - The company aims to maintain its customer base while seeking new business opportunities and expanding its production capacity through enhanced refrigeration capabilities[12]. - The joint venture established with Rongshi Global Holdings Limited on May 24, 2019, allows the company to hold a 55% stake, enhancing its presence in the food and beverage sector in Hong Kong[11]. - The ongoing social unrest and the complexity of the US-China trade war have adversely affected the company's business operations in 2019[9]. - The company is focused on continuous development despite the challenges posed by the COVID-19 pandemic, which has significantly impacted the Hong Kong economy[9]. - The company is exploring new opportunities for synergy with existing operations and is in discussions regarding R&D for new products with potential and existing customers[67]. Employee and Human Resources - Employee benefits expenses increased from approximately HKD 21.2 million to approximately HKD 21.3 million due to salary increases[19]. - The establishment of a human resources department was partially funded, with only HKD 0.4 million utilized out of the planned HKD 0.9 million[13]. - The company has committed to strengthening its logistics team with an allocation of HKD 2.4 million from the IPO proceeds[13]. - The group had a total of 48 employees, down from 55 in 2018[75]. - The company maintains competitive compensation levels, with employee remuneration linked to performance[75]. - The company is committed to providing a safe and healthy work environment, ensuring equal opportunities for all employees[75]. - Employee engagement initiatives have been implemented, resulting in a 30% increase in staff retention rates[40]. Governance and Compliance - The board consists of three executive directors, three non-executive directors, and three independent non-executive directors, ensuring a balanced governance structure[130]. - The company has adopted the corporate governance code as per GEM listing rules and has complied with its provisions throughout the year[125]. - The board is responsible for approving and monitoring the overall strategy and policies of the group, focusing on growth and financial performance[134]. - The company has appointed a compliance advisor, Huifu Finance Limited, in accordance with GEM listing rules[117]. - The group has established a bribery prevention policy for all employees to adhere to[109]. Environmental, Social, and Governance (ESG) - The environmental, social, and governance (ESG) report covers the company's performance in these areas for the year ending December 31, 2019[169]. - The company is focusing on sustainability, aiming to reduce carbon emissions by 15% over the next three years[40]. - The total fuel consumption of the company's truck fleet during the reporting period was 44,802 liters[175]. - Greenhouse gas emissions from mobile sources (road transport) totaled 117,112 kg of CO2, with additional emissions of 0.1071 kg of CH4 and 0.332 kg of N2O[177]. - The company's annual electricity consumption was 1,557,746 kWh, resulting in indirect emissions of 981,379.98 kg of CO2[178]. - The total amount of fresh water used by the company was 14,258 cubic meters, with an equal amount of wastewater generated[180]. - The company has implemented measures to reduce emissions, such as minimizing office lighting and air conditioning during lunch hours[185]. - The group evaluates suppliers based on environmental and social performance, maintaining stable product supply and quality through regular pricing procedures[194]. Future Outlook - The company has set a future outlook with a revenue target of HKD 1.5 billion for the next fiscal year, indicating a projected growth of 25%[40]. - New product development includes the launch of a premium food line, expected to contribute an additional HKD 200 million in revenue[40]. - The company is expanding its market presence in Southeast Asia, with plans to enter three new countries by the end of the fiscal year[40]. - A strategic acquisition of a local competitor is in progress, which is anticipated to enhance market share by 10%[40]. - The company has invested HKD 50 million in technology upgrades to improve operational efficiency and reduce costs by 5%[40]. Audit and Financial Reporting - The independent auditor confirmed that the consolidated financial statements reflect the group's financial position as of December 31, 2019, in accordance with Hong Kong Financial Reporting Standards[198]. - The audit was conducted based on Hong Kong auditing standards, ensuring the independence of the auditor and adherence to ethical responsibilities[199]. - Key audit matters were identified based on professional judgment, focusing on significant risks of material misstatement in the consolidated financial statements[200].
运兴泰集团(08362) - 2019 - 年度财报