瀛海集团(08668) - 2020 Q3 - 季度财报

Characteristics of GEM and Directors' Responsibility Statement This section outlines the characteristics of the GEM market and the directors' collective and individual responsibility for the accuracy and completeness of the report Characteristics of GEM The GEM market provides a listing platform for small and medium-sized companies, entailing higher investment risks and potential for significant market volatility - GEM market is positioned for small and medium-sized companies, with higher investment risks[2] - GEM securities may be subject to significant market volatility and cannot guarantee high liquidity[2] Directors' Responsibility Statement The Board of Directors collectively and individually assumes full responsibility for the accuracy, completeness, and non-misleading nature of the information in this report - The Board of Directors assumes full responsibility for the accuracy, completeness, and non-misleading nature of the information in this report[3] Financial Highlights For the nine months ended September 30, 2020, the Group's revenue significantly decreased by 88.3% to HK$16.1 million, resulting in a loss attributable to owners of HK$17.4 million Financial Highlights for the Nine Months Ended September 30, 2020 | Metric | Nine Months Ended Sep 30, 2020 (HK$'000) | Nine Months Ended Sep 30, 2019 (HK$'000) | Change (HK$'000) | Change Percentage | | :--- | :--- | :--- | :--- | :--- | | Revenue | 16,100 | 137,000 | (120,900) | -88.3% | | Loss for the period attributable to owners of the Company | (17,400) | (700) | (16,700) | 2385.7% | | Basic and diluted loss per share | (1.45) HK cents | (0.08) HK cents | (1.37) HK cents | 1712.5% | - The Board of Directors resolved not to recommend the payment of an interim dividend for the nine months ended September 30, 2020[6] Unaudited Condensed Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements, including the statement of profit or loss, statement of changes in equity, and detailed notes on accounting policies and segment information Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income The Group recorded a significant decline in revenue for the nine months ended September 30, 2020, leading to a substantial reduction in gross profit and a loss of HK$17.4 million for the period Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Nine Months Ended September 30) | Metric | 2020 (HK$'000) | 2019 (HK$'000) | Change (HK$'000) | Change Percentage | | :--- | :--- | :--- | :--- | :--- | | Revenue | 16,087 | 136,997 | (120,910) | -88.3% | | Cost of sales | (13,740) | (109,040) | 95,300 | -87.4% | | Gross profit | 2,347 | 27,957 | (25,610) | -91.6% | | Other income and gains | 1,154 | 451 | 703 | 155.9% | | Administrative expenses | (20,791) | (11,705) | (9,086) | 77.6% | | Listing expenses | — | (16,868) | 16,868 | -100.0% | | Finance costs | (158) | (163) | 5 | -3.1% | | Loss before tax | (17,448) | (328) | (17,120) | 5219.5% | | Income tax credit/(expense) | — | (419) | 419 | -100.0% | | Loss for the period | (17,448) | (747) | (16,701) | 2235.7% | | Basic and diluted loss per share | (1.45) HK cents | (0.08) HK cents | (1.37) HK cents | 1712.5% | Unaudited Condensed Consolidated Statement of Changes in Equity For the nine months ended September 30, 2020, total equity decreased from HK$98.5 million to HK$80.8 million, primarily due to a loss of HK$17.4 million for the period Condensed Consolidated Statement of Changes in Equity (For the Nine Months Ended September 30) | Metric | Sep 30, 2020 (HK$'000) | Sep 30, 2019 (HK$'000) | | :--- | :--- | :--- | | Share capital | 12,000 | 12,000 | | Share premium | 50,302 | 50,302 | | Merger reserve | 3,011 | 3,011 | | Statutory reserve | 801 | 801 | | Revaluation reserve | (6) | — | | Exchange fluctuation reserve | (92) | (135) | | Retained earnings | 14,773 | 32,540 | | Total | 80,789 | 98,519 | - The loss for the period of HK$17.4 million had a significant negative impact on equity[10] Notes to the Unaudited Condensed Consolidated Financial Statements This section provides detailed notes to the financial statements, covering company information, accounting policies, segment revenue, other income, expenses, and loss per share calculations General Information The Company was incorporated in the Cayman Islands and listed on GEM of the Stock Exchange on September 26, 2019, primarily engaging in ticket sales, hotel room distribution, and vehicle rental services in Macau - The Company was listed on GEM of the Stock Exchange on September 26, 2019[19] - Principal activities include sales and distribution of hotel rooms, air tickets, travel-related products and services, concert sponsorship, and vehicle rental services in Macau[19] Reorganisation The Company completed a reorganisation on March 8, 2019, becoming the group's holding company, with no changes in business management or ultimate owners before and after the reorganisation - The Company completed a reorganisation on March 8, 2019, becoming the group's holding company[21] - The reorganisation was an intra-group reorganisation, with no changes in business management or ultimate owners[21] Basis of Preparation and Principal Accounting Policies The unaudited condensed consolidated financial statements are prepared in accordance with HKAS 34 and are consistent with the accounting policies adopted in the audited consolidated financial statements for the year ended December 31, 2019 - Financial statements are prepared in accordance with HKAS 34 and are consistent with the accounting policies of the annual consolidated financial statements[23] - The application of new and revised HKFRSs did not have a significant impact on the amounts or disclosures in the statements[24] Revenue and Segment Information The Group operates two reportable segments, travel and automobile businesses, both experiencing significant declines in revenue and results for the nine months ended September 30, 2020 Segment Revenue (For the Nine Months Ended September 30) | Segment | 2020 (HK$'000) | 2019 (HK$'000) | Change (HK$'000) | Change Percentage | | :--- | :--- | :--- | :--- | :--- | | Travel business | 14,275 | 127,719 | (113,444) | -88.8% | | Automobile business | 1,812 | 9,278 | (7,466) | -80.5% | | Total | 16,087 | 136,997 | (120,910) | -88.3% | Segment Results (For the Nine Months Ended September 30, 2020) | Segment | Result (HK$'000) | | :--- | :--- | | Travel business | (7,146) | | Automobile business | (5,915) | | Total reportable segment results | (13,061) | - Travel business includes sales and distribution of hotel rooms, air tickets, travel packages, and concert sponsorship[31] - Automobile business refers to vehicle rental and limousine services in Macau[32] Other Income and Gains For the nine months ended September 30, 2020, other income and gains increased to HK$1.2 million, primarily due to government subsidies of HK$694 thousand Other Income and Gains (For the Nine Months Ended September 30) | Item | 2020 (HK$'000) | 2019 (HK$'000) | | :--- | :--- | :--- | | Interest income | 87 | 36 | | Exchange gains | 51 | 18 | | Government grants | 694 | — | | Miscellaneous income | 322 | 25 | | Total | 1,154 | 451 | - Government grants were the primary reason for the increase in other income and gains in 2020[37] Finance Costs For the nine months ended September 30, 2020, finance costs remained stable at approximately HK$158 thousand, mainly from bank overdraft interest and lease liabilities interest Finance Costs (For the Nine Months Ended September 30) | Item | 2020 (HK$'000) | 2019 (HK$'000) | | :--- | :--- | :--- | | Interest on bank overdrafts | 79 | — | | Interest on lease liabilities | 79 | 70 | | Interest on secured bank borrowings | — | 93 | | Total | 158 | 163 | Loss Before Tax For the nine months ended September 30, 2020, the loss before tax was HK$17.4 million, primarily driven by depreciation of property, plant and equipment, right-of-use assets, and impairment losses Components of Loss Before Tax (For the Nine Months Ended September 30) | Item | 2020 (HK$'000) | 2019 (HK$'000) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 4,554 | 3,502 | | Depreciation of right-of-use assets | 1,310 | 1,712 | | Amortisation of intangible assets | 392 | — | | Impairment loss recognised on trade receivables | 616 | — | | Impairment loss recognised on right-of-use assets | 1,832 | — | | Listing expenses | — | 16,868 | | Employee benefit expenses | 8,129 | 7,759 | Income Tax Credit/(Expense) For the nine months ended September 30, 2020, the Group incurred no income tax expense due to the absence of taxable profits, contrasting with an expense of HK$419 thousand in the prior period - For the nine-month period in 2020, the Group had no income tax expense due to no taxable profits[43] Income Tax Credit/(Expense) (For the Nine Months Ended September 30) | Item | 2020 (HK$'000) | 2019 (HK$'000) | | :--- | :--- | :--- | | Current tax | — | 374 | | Deferred tax | — | 45 | | Total | — | 419 | Loss Per Share For the nine months ended September 30, 2020, basic and diluted loss per share attributable to owners was 1.45 HK cents, a significant increase from 0.08 HK cents in the prior period Loss Per Share (For the Nine Months Ended September 30) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Loss for the period attributable to owners of the Company (HK$'000) | (17,448) | (747) | | Weighted average number of ordinary shares (thousands) | 1,200,000 | 905,495 | | Basic and diluted loss per share (HK cents) | (1.45) | (0.08) | - Diluted loss per share is the same as basic loss per share due to the absence of potential dilutive ordinary shares[46] Dividends The Board resolved not to declare or propose an interim dividend for the nine months ended September 30, 2020, unlike the prior period's pre-listing interim dividend of approximately HK$8.9 million - For the nine months ended September 30, 2020, the Company did not declare or propose an interim dividend[47] Management Discussion and Analysis This section details the Group's business performance, financial position, use of IPO proceeds, strategic progress, key risks, employee policies, and future outlook, highlighting the significant adverse impact of the COVID-19 pandemic Business Review The Group is a licensed wholesale travel agent and car rental service provider in Macau, offering hotel room sales, car rentals, air tickets, travel packages, and concert sponsorship, having listed on GEM on September 26, 2019 - The Group's principal activities are travel services and automobile rental services within Macau[48] - Business scope includes hotel room sales, car rentals, air tickets and travel packages, and concert sponsorship[48] - The Company successfully listed on GEM of the Stock Exchange on September 26, 2019[49] Financial Review The Group's financial performance for the nine months ended September 30, 2020, was severely impacted by the COVID-19 pandemic, leading to substantial revenue decline, reduced gross profit, and significant losses Revenue Group revenue significantly decreased by 88.3% to HK$16.1 million for the nine months ended September 30, 2020, primarily due to reduced demand for hotel rooms and car rental services in Macau caused by the pandemic Revenue Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | | Revenue | 16.1 | 137.0 | -88.3% | - The significant decrease in revenue was primarily attributable to the outbreak of COVID-19, travel restrictions, and a decline in tourist arrivals in Macau[50] Cost of Sales Cost of sales decreased by 87.4% to HK$13.7 million for the nine months ended September 30, 2020, primarily due to reduced sales of hotel rooms and car rental services Cost of Sales Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | | Cost of sales | 13.7 | 109.0 | -87.4% | - The decrease in cost of sales was mainly due to reduced sales of hotel rooms and car rental services[51] Gross Profit Gross profit significantly declined by 91.8% to HK$2.3 million for the nine months ended September 30, 2020, primarily impacted by the substantial decrease in revenue Gross Profit Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | | Gross profit | 2.3 | 28.0 | -91.8% | - The significant decline in gross profit was primarily due to reduced revenue from hotel room sales and car rental services[52] Other Income and Gains Other income and gains increased to HK$1.2 million for the nine months ended September 30, 2020, primarily benefiting from a one-off government grant Other Income and Gains Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | | Other income and gains | 1.2 | 0.451 | 155.0% | - The increase in other income and gains was mainly due to a one-off government grant received in 2020[53] Administrative Expenses Administrative expenses increased by 77.8% to HK$20.8 million for the nine months ended September 30, 2020, primarily due to impairment losses on right-of-use assets and increased employee benefits, depreciation, and professional fees post-listing Administrative Expenses Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | | Administrative expenses | 20.8 | 11.7 | 77.8% | - The increase in administrative expenses was mainly due to impairment losses on right-of-use assets, increased employee benefits, depreciation, and professional fees[54] Income Tax Expense For the nine months ended September 30, 2020, the Group incurred no income tax expense as no taxable profits were generated during the period - For the nine-month period in 2020, the Group had no income tax expense due to no taxable profits[55] Finance Costs The Group's finance costs remained stable at approximately HK$158 thousand and HK$163 thousand for the nine-month periods in 2020 and 2019, respectively Finance Costs Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$'000) | 2019 (HK$'000) | Change Percentage | | :--- | :--- | :--- | :--- | | Finance costs | 158 | 163 | -3.1% | Loss for the Period For the nine months ended September 30, 2020, the Group recorded a loss of approximately HK$17.4 million, a significant increase from HK$0.7 million in the prior period, primarily due to reduced revenue and increased administrative expenses caused by the pandemic Loss for the Period Change (For the Nine Months Ended September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | | Loss for the period | 17.4 | 0.7 | 2385.7% | - The increase in loss was mainly due to a significant decrease in revenue and an increase in administrative expenses caused by the pandemic[57] Use of Net Proceeds from Listing Of the approximately HK$39.3 million net proceeds from listing, HK$8.5 million was utilised by September 30, 2020, with the remaining HK$30.8 million unutilised due to delays in fleet expansion and hotel cooperation plans caused by the pandemic Use of Net Proceeds from Listing (As at September 30, 2020) | Intended Use | Planned Amount (HK$'000) | Actual Use (HK$'000) | Unutilised Amount (HK$'000) | Expected Timeline | | :--- | :--- | :--- | :--- | :--- | | Expand our fleet | 20,568 | 3,965 | 16,603 | December 2022 | | Collaborate with more hotel operators | 6,480 | — | 6,480 | December 2021 | | Increase marketing and expand sales channels | 6,917 | 2,319 | 4,598 | December 2022 | | Improve our operational efficiency | 1,659 | 1,485 | 174 | December 2020 | | Expand our workforce | 2,592 | 388 | 2,204 | December 2022 | | General working capital | 1,080 | 330 | 750 | December 2022 | | Total | 39,296 | 8,487 | 30,809 | | - The delay in utilising proceeds was mainly due to the outbreak of the pandemic and market conditions, postponing fleet expansion and hotel operator collaboration plans[61] - The unutilised portion of approximately HK$30.8 million is placed in bank time deposits[61] Comparison of Business Strategies with Actual Business Progress The Group has made progress on business objectives, including new car purchases and office activation, but fleet expansion and hotel collaboration plans have been adjusted due to market demand and pandemic impacts, while actively seeking partners and expanding sales channels - Eight new cars have been purchased to expand the fleet, with progress to be adjusted based on Macau market demand[63] - Actively seeking popular and high-quality hotels for collaboration[63] - Increasing marketing and sales channels through new service points, developing online sales platforms, and social media advertising[63] - New office renovation and activation are complete, and experienced staff are being recruited to expand the workforce[63] Key Risks and Uncertainties in Achieving Business Strategies The Group faces multiple risks in executing its business strategies, including the ongoing impact of the pandemic on Macau's tourism, challenges in securing hotel partnerships, difficulties in market timing, and evolving consumer behavior amid intense competition - The pandemic severely impacts Macau's tourism, leading to travel restrictions and low consumer sentiment, which may continue to affect business[64] - Failure to find hotel operators offering attractive terms to achieve expansion plans[64] - Difficulty in grasping business trends to determine the optimal timing for market entry or new sales channel expansion[64] - Facing changing consumer behavior and intense competition in a volatile business environment[64] Key Risks and Uncertainties The Group faces various risks that could significantly impact its business, financial condition, or operating results, including reliance on Macau's tourism, policy changes, border closures, customer payment delays, and concentration risks with key suppliers and customers - The pandemic, travel restrictions, and low consumer sentiment may lead to a sustained decrease in tourist arrivals to Macau[66] - Revenue primarily derived from Macau is susceptible to changes in Macau and China's policies and economic environment[67] - Risk of border closures or re-imposition of travel restrictions[68] - Customers may delay or default on payments, while the Group still incurs costs[69] - Key suppliers may deal directly with customers, or travel agent customers may obtain hotel rooms from each other, bypassing the Group[69] - Revenue primarily from Hotel Royal Macau, with adverse effects if agreements terminate or renewal terms are unfavorable[69] - Failure to sell hotel rooms above pre-determined prices or reduced supply from hotel operators may lead to reduced profits or losses[69] - Concentration risk of revenue from a single customer (Customer A), where a reduction or loss of business would significantly and adversely impact operations and financial condition[69][70] - Failure to obtain and maintain sufficient parking spaces at a reasonable cost may affect growth opportunities[71] Employees and Remuneration Policy As of September 30, 2020, the Group employed 113 staff, with employee benefit expenses, including directors' emoluments, amounting to approximately HK$8.1 million, and remuneration determined by market terms, performance, qualifications, and experience Employee and Remuneration Data (For the Nine Months Ended September 30) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Number of employees | 113 | 109 | | Employee benefit expenses (HK$ Million) | 8.1 | 7.8 | Significant Acquisitions and Disposals of Subsidiaries On July 9, 2020, the Company acquired a 49% interest in Meet Culture Limited for approximately HK$2.2 million, a souvenir design and sales business expected to complement travel operations and provide synergies, with no other significant acquisitions or disposals during the period - Acquired a 49% interest in Meet Culture Limited on July 9, 2020, for approximately HK$2.2 million[73] - Meet Culture Limited primarily engages in souvenir design and sales, expected to complement travel business and provide synergies[73] - The acquisition of a 22% interest from an associated company constituted a fully exempt connected transaction[73] Significant Investments Held As of September 30, 2020, the Group held no other significant investments apart from equity instruments at fair value through other comprehensive income and interests in an associate - The Group holds no other significant investments, only equity instruments at fair value through other comprehensive income and interests in an associate[75] Liquidity and Financial Resources The Group's liquidity and financial resources indicate a stable capital structure and improved cash position, but increased borrowings and gearing ratio reflect changes in working capital needs and financing activities Capital Structure There have been no significant changes in the Company's share capital structure from the listing date up to September 30, 2020 - There have been no significant changes in the Company's share capital structure from the listing date up to September 30, 2020[76] Cash Position As of September 30, 2020, bank balances and cash were approximately HK$62.5 million, an increase from the prior period, mainly due to cash generated from bank overdrafts and transfers to long-term bank deposits for guarantees Bank Balances and Cash (As at September 30) | Metric | 2020 (HK$ Million) | 2019 (HK$ Million) | Change (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | :--- | | Bank balances and cash | 62.5 | 50.5 | 12.0 | 23.8% | - The increase in cash was mainly due to cash generated from bank overdrafts and a portion of cash transferred to bank deposits with original maturity over three months for guarantees[77] Borrowings and Lease Liabilities As of September 30, 2020, total borrowings and lease liabilities were approximately HK$14.4 million, an increase from the prior period, primarily due to increased bank borrowings, while lease liabilities decreased due to fewer leased properties Borrowings and Lease Liabilities (As at September 30) | Item | 2020 (HK$ Million) | 2019 (HK$ Million) | Change (HK$ Million) | Change Percentage | | :--- | :--- | :--- | :--- | :--- | | Total borrowings and lease liabilities | 14.4 | 7.4 | 7.0 | 94.6% | | Bank borrowings | 12.2 | 3.8 | 8.4 | 221.1% | | Lease liabilities | 2.2 | 3.6 | (1.4) | -38.9% | - The decrease in lease liabilities was mainly attributable to a reduction in the number of leased properties[78] Pledge of Assets As of September 30, 2020, the Group pledged bank deposits with a carrying value of approximately HK$59.7 million as security for general banking facilities and a car park with a carrying value of approximately HK$3.0 million for bank borrowings Pledge of Assets (As at September 30) | Pledged Assets | 2020 (HK$ Million) | 2019 (HK$ Million) | | :--- | :--- | :--- | | Bank deposits | 59.7 | 6.1 | | Car park | 3.0 | — | | Motor vehicles | — | 9.8 | Gearing Ratio As of September 30, 2020, the Group's gearing ratio was approximately 17.8%, an increase from 7.5% in the prior period, primarily due to increased bank overdrafts and bank borrowings Gearing Ratio (As at September 30) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Gearing ratio | 17.8% | 7.5% | - The increase in gearing ratio was mainly due to increased bank overdrafts and bank borrowings[80] Dividends For the nine months ended September 30, 2020, the Company did not declare or propose any interim dividend - For the nine months ended September 30, 2020, the Company did not declare or propose any interim dividend[81] Commitments As of September 30, 2020, the Group had capital commitments of approximately HK$1.1 million for contracted but unprovided acquisition of property, plant, and equipment Capital Commitments (As at September 30) | Item | 2020 (HK$ Million) | 2019 (HK$ Million) | | :--- | :--- | :--- | | Capital commitments for acquisition of property, plant and equipment | 1.1 | 0 | Contingent Liabilities As of September 30, 2020, the Group had no significant contingent liabilities - As of September 30, 2020, the Group had no significant contingent liabilities[83] Foreign Exchange Risk Operating in Macau, the Group's primary transactions are settled in MOP and HKD, and given the MOP's peg to HKD, the Group perceives no significant foreign exchange risk and undertook no hedging activities during the period - The Group perceives no significant foreign exchange risk due to the MOP's peg to HKD[85] - No hedging activities were undertaken during the period using foreign exchange contracts, interest rate or currency swaps, or other financial derivative instruments[85] Outlook The Group aims to consolidate its market position in Macau's tourism industry, achieve sustainable growth by expanding its fleet, collaborating with more hotels, and enhancing sales channels, anticipating gradual business improvement as border restrictions ease - Strategic objectives are to consolidate market position in Macau's tourism industry, generate desirable profits and investment returns, and drive sustainable growth[86] - Plans include expanding the fleet, collaborating with more hotel operators for mid-to-high-end hotel rooms, and leveraging concert sponsorship to broaden the revenue base[86] - Intends to open more service points, develop online platform applications, and invest in social media platforms and search engine advertising for digital marketing[87] - Despite ongoing pandemic impacts, directors anticipate gradual business improvement as borders between China and Macau progressively reopen[87] - Will continue to review the business environment, implement business strategies, and enforce cost control measures[88] Corporate Governance Practices The Company is committed to maintaining high corporate governance standards, adopting the GEM Listing Rules' Corporate Governance Code, though the combined roles of Chairman and CEO deviate from Code Provision A.2.1 - The Company has adopted the Corporate Governance Code set out in Appendix 15 to the GEM Listing Rules[90] - The roles of Chairman and Chief Executive Officer are combined and held by Mr. Choi Wai Chun, deviating from Code Provision A.2.1[90] - The Board believes that Mr. Choi's dual role is in the best interests of the Group[90] Competing Business For the nine months ended September 30, 2020, the Directors were unaware of any business or interest of any Director, controlling shareholder, or their close associates that competes with or conflicts with the Group's business - Directors are unaware of any competing business or conflicts of interest involving any Director or controlling shareholder[91] Interests of Compliance Adviser As of September 30, 2020, the compliance adviser or its directors, employees, or close associates held no notifiable interests in the Group's share capital, other than fees for compliance advisory services - The compliance adviser or its associates hold no notifiable interests in the Group's share capital, only fees for compliance advisory services[92] Purchase, Sale or Redemption of Listed Securities During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of its listed securities - During the review period, neither the Company nor its subsidiaries purchased, sold, or redeemed any shares[93] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company and its Associated Corporations As of September 30, 2020, Executive Director Mr. Choi Wai Chun held 75.0% of the Company's ordinary shares through Silver Esteem Limited, in which he has a 100% beneficial interest Directors' Long Positions in Shares (As at September 30, 2020) | Name of Director | Capacity | Number of ordinary shares interested | Percentage of shareholding | | :--- | :--- | :--- | :--- | | Mr. Choi Wai Chun | Interest of controlled corporation | 900,000,000 | 75.0% | Directors' Long Positions in Shares of Associated Corporations (As at September 30, 2020) | Name of Director | Name of Associated Corporation | Capacity | Number of ordinary shares interested | Percentage of shareholding | | :--- | :--- | :--- | :--- | | Mr. Choi Wai Chun | Silver Esteem Limited | Beneficial owner | 1 | 100% | - Mr. Choi Wai Chun is deemed to be interested in all shares held by Silver Esteem Limited[95] Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company As of September 30, 2020, substantial shareholder Silver Esteem Limited held 75.0% of the Company's shares, and Ms. Wong Pui King, Mr. Choi Wai Chun's spouse, was deemed to have an interest in the same shares Substantial Shareholders' Long Positions in Shares (As at September 30, 2020) | Name of Shareholder | Capacity | Number of ordinary shares interested | Percentage of shareholding | | :--- | :--- | :--- | :--- | | Silver Esteem Limited | Beneficial owner | 900,000,000 | 75.0% | | Ms. Wong Pui King | Interest of spouse | 900,000,000 | 75.0% | - Silver Esteem Limited is wholly owned by Mr. Choi Wai Chun, and his spouse, Ms. Wong Pui King, is deemed to be interested in all shares held by it[98][99] Share Option Scheme The Company adopted a share option scheme on September 3, 2019, but no options were granted, agreed to be granted, exercised, cancelled, or lapsed under the scheme during the nine months ended September 30, 2020 - The Company adopted a share option scheme on September 3, 2019[100] - No share options were granted, exercised, cancelled, or lapsed under the scheme during the nine months ended September 30, 2020, and up to the date of this report[100] Standard of Dealings by Directors in Securities The Group has adopted the required standard of dealings as set out in the GEM Listing Rules for directors' securities transactions, with all directors confirming compliance during the nine months ended September 30, 2020 - The Group has adopted the required standard of dealings as set out in Rules 5.48 to 5.67 of the GEM Listing Rules[101] - All Directors confirmed compliance with the standard of dealings during the review period[101] Events After Reporting Period No significant disclosable events occurred after the reporting period up to the date of this report - No significant disclosable events occurred after the reporting period up to the date of this report[102] Audit Committee The Company's Audit Committee reviewed the unaudited condensed consolidated financial statements for the nine months ended September 30, 2020, deeming them compliant with applicable accounting standards and GEM Listing Rules - The Audit Committee comprises three independent non-executive Directors, with Mr. Wu Chung Ming as Chairman[103] - The Audit Committee reviewed the unaudited condensed consolidated financial statements, deeming them compliant with applicable accounting standards, GEM Listing Rules, and adequately disclosed[103]