Financial Performance - The company's revenue increased from approximately HKD 878.8 million for the year ended March 31, 2019, to approximately HKD 932.8 million for the year ended March 31, 2020, primarily due to increased revenue from RMAA services[7]. - The profit attributable to shareholders decreased from approximately HKD 38.3 million for the year ended March 31, 2019, to approximately HKD 24.5 million for the year ended March 31, 2020, mainly due to non-recurring listing expenses of approximately HKD 18.5 million related to the transfer of listing[7]. - The gross profit increased from approximately HKD 62.3 million to approximately HKD 75.2 million, with the gross profit margin rising from approximately 7.1% to approximately 8.1%[16]. - Administrative expenses rose from approximately HKD 16.0 million to approximately HKD 22.5 million, primarily due to increased employee costs[18]. - The financing costs slightly decreased by approximately HKD 0.1 million due to reduced bank loan interest[21]. - The effective tax rate for the year was approximately 17.0%, which is close to the actual tax rate of 16.5% after excluding non-deductible listing expenses[22]. - The company did not recommend the payment of a final dividend for the year ended March 31, 2020[24]. - As of March 31, 2020, the group maintained a healthy financial position with cash and bank balances of approximately HKD 73.4 million, down from HKD 91.9 million in 2019[25]. - The total interest-bearing borrowings amounted to approximately HKD 8.9 million as of March 31, 2020, compared to HKD 7.2 million in 2019, resulting in a debt-to-equity ratio of approximately 4.8%[26]. - The group had a current ratio of approximately 2.7 as of March 31, 2020, an increase from 2.3 in 2019[25]. - The total employee cost for the year ended March 31, 2020, was approximately HKD 84.6 million, up from HKD 60.1 million in 2019, with a total of 304 employees compared to 250 in 2019[38]. Corporate Governance - The company has adopted and complied with the corporate governance code as per the listing rules, ensuring transparency and accountability[74]. - The board consists of executive directors including the chairman and CEO, which enhances the efficiency of strategy formulation and implementation[76]. - The company has appointed three independent non-executive directors, with one possessing appropriate qualifications in accounting and financial management[79]. - The company is committed to maintaining good corporate governance practices since its listing, which is essential for effective management and business development[74]. - The management team has extensive experience in the construction industry, with key members having over 22 years and 25 years of experience respectively[65][66]. - The financial director oversees the company's financial activities, budgeting, and forecasting, ensuring sound financial management[69]. - The company has a structured approach to project management, with senior project managers responsible for overseeing construction projects[66]. - The company emphasizes continuous improvement in corporate governance standards to meet regulatory expectations[74]. - The board of directors is responsible for leading and monitoring the company's overall business, ensuring high levels of corporate governance[80]. - The audit committee, consisting of three independent non-executive directors, reviews and supervises the financial reporting process and risk management systems[82]. - The remuneration committee held one meeting during the year to review the compensation of executive directors and senior management[86]. - The nomination committee is responsible for reviewing the board's structure and recommending suitable candidates for board membership[89]. - The audit committee met three times during the year to review the consolidated financial statements and internal control systems[85]. - The company has confirmed the independence of its independent non-executive directors in accordance with listing rules[80]. - The remuneration committee's recommendations ensure that no director determines their own remuneration[86]. - The nomination policy aims to ensure a balanced board with the necessary skills and diverse perspectives for the company's business needs[93]. - The company has established specific written terms of reference for each committee to assist in fulfilling their responsibilities[81]. - The board regularly reviews the allocation of duties and responsibilities among executive directors and senior management[80]. - The nomination committee will evaluate candidates for board positions based on various criteria, including internal promotions and external recommendations[98]. - The board plans to hold approximately four meetings annually, with all directors attending all meetings during the reporting period[111]. - The company has adopted a code of conduct for directors regarding securities trading, ensuring compliance with listing rules[104]. - The board diversity policy aims to enhance performance quality by considering measurable criteria such as gender, age, and professional experience[106]. - The nomination committee will regularly review the board's structure and diversity policy to ensure alignment with the company's business needs[103]. - Independent non-executive directors are appointed for an initial term of three years and are subject to re-election[117]. - The company ensures that all directors have access to necessary information and resources to fulfill their responsibilities[116]. - The board has established a mechanism for the re-election of directors, ensuring compliance with governance codes[118]. - The nomination committee will propose recommendations for the re-election of retiring directors at the annual general meeting[99]. - The company has not identified any breaches of the standard code of conduct by directors since its listing date[104]. - The board of directors emphasizes the importance of continuous professional development and encourages participation in relevant seminars to enhance knowledge and skills[119]. - As of March 31, 2020, all executive directors participated in training related to corporate governance and regulatory updates[122]. Risk Management and Internal Control - The external auditor, Deloitte, provided an independent opinion on the consolidated financial statements, confirming no significant uncertainties affecting the group's ability to continue as a going concern[123]. - The board conducted a regular review of the effectiveness of the internal control system, which was deemed effective and sufficient[129]. - The total fees paid or payable to the external auditor for audit and non-audit services amounted to HKD 3,023,000, with audit fees at HKD 1,050,000 and non-audit fees at HKD 1,973,000[132]. - The group has adopted a three-tier risk management approach to identify, analyze, assess, mitigate, and respond to risks[130]. - The board is responsible for establishing and maintaining the internal control system to safeguard shareholder investments and group assets[124]. - The company has no internal audit function; external independent consultants conduct the annual review of internal controls[129]. - The board is committed to ensuring that risk management is integrated into daily operations[130]. Environmental, Social, and Governance (ESG) - The company has committed to reducing its environmental impact and maintaining green operations, with a focus on providing RMAA services[157]. - During the reporting period, the company did not generate or consume significant hazardous waste or harmful materials[159]. - The company has implemented measures to comply with local environmental laws, including air and noise pollution control[158]. - The board is responsible for assessing and determining the company's environmental, social, and governance (ESG) risks and ensuring effective management systems are in place[150]. - The company will continue to evaluate its business impact on key ESG aspects and incorporate this into its reporting[152]. - The environmental, social, and governance report is prepared in accordance with the guidelines set out in the listing rules[153]. - The company has established multiple communication channels with shareholders and investors, including annual meetings and reports[143]. - The company has received no significant violations of environmental protection laws during the reporting period[158]. - In 2020, nitrogen oxides emissions were 539.30 kg, a decrease from 588.11 kg in 2019, representing a reduction of approximately 8.3%[163]. - Total greenhouse gas emissions in 2020 were 286,806.00 kg CO2 equivalent, up from 276,855.25 kg in 2019, indicating an increase of about 3.7%[163]. - The energy consumption in 2020 totaled 931,338.89 kWh, compared to 907,724.69 kWh in 2019, reflecting an increase of approximately 2.6%[169]. - The company consumed 1,700 kg of paper in the reporting period, an increase from 1,365 kg in 2019, which is a rise of about 24.5%[173]. - Direct emissions (Scope 1) in 2020 were 256,058.61 kg CO2 equivalent, slightly up from 251,211.43 kg in 2019, marking an increase of around 1.5%[163]. - Indirect emissions (Scope 2) rose to 30,747.39 kg CO2 equivalent in 2020 from 25,643.82 kg in 2019, which is an increase of approximately 19.5%[163]. - The energy density in 2020 was 1.00 kWh per thousand HKD revenue, down from 1.03 kWh in 2019[169]. - The company implemented measures to reduce paper usage, promoting double-sided printing and electronic communication[172]. - The company emphasizes effective resource utilization, focusing on reducing waste and implementing recycling programs[164]. Employment Practices - The company has not reported any significant non-compliance incidents related to employment during the reporting period[180]. - No work-related injury cases were reported during the reporting period[185]. - The company strictly adheres to the Hong Kong Employment Ordinance and other relevant labor laws, prohibiting child labor and forced labor[190]. - The company has established a list of approved suppliers and subcontractors based on performance evaluations and compliance with safety standards[192]. - There were no disputes regarding the quality of work performed by the company or its subcontractors during the reporting period[197]. - The company has implemented a whistleblowing policy to promote business ethics and integrity, with no legal cases related to corruption or money laundering reported during the period[200].
德益控股(09900) - 2020 - 年度财报