Financial Performance - The Group recorded total revenue of HK$350.8 million for the year ended 31 March 2021, representing an increase of approximately 43% compared to HK$245.5 million for the year ended 31 March 2020[27]. - The gross profit for the year was approximately HK$21.4 million, which is lower than the gross profit of approximately HK$60.9 million for the year ended 31 March 2020[27]. - The gross profit for the year amounted to approximately HK$21.4 million, representing a decrease of approximately 65% compared to approximately HK$60.9 million for the year ended 31 March 2020[39]. - The gross profit margin for the year was approximately 6.1%, down from approximately 24.8% for the year ended 31 March 2020[39]. - Other income and gain for the year amounted to approximately HK$5.2 million, representing an increase of approximately 311% compared to approximately HK$1.3 million for the year ended 31 March 2020[43]. - Profit attributable to owners of the Company decreased by approximately HK$21.7 million or approximately 78%, from approximately HK$27.7 million to approximately HK$6.0 million for the year[48]. Project and Revenue Insights - The increase in revenue was primarily driven by ongoing projects in the execution-peak stage during the year[38]. - The Group has a total of nine ongoing projects, each with an awarded contract sum of over HK$5 million as of 31 March 2021[35]. - The aggregate contract sums of ongoing projects amounted to approximately HK$716.2 million, with recognized revenue of approximately HK$461.4 million as of 31 March 2021[35]. - The Group's revenue from the largest customer accounted for 59.2% for the year ended 31 March 2021, up from 57.8% in the previous year[80]. - The aggregate revenue from the five largest customers represented 94.0% for the year ended 31 March 2020[80]. Cost and Expense Management - The decrease in gross profit was mainly due to additional costs paid to suppliers to increase production capacity and increased subcontracting costs due to unstable project schedules during the COVID-19 pandemic[27]. - The increase in overall construction costs was attributed to additional costs incurred for subcontracting works due to unstable project schedules during COVID-19[39]. - Administrative expenses for the year amounted to approximately HK$15.7 million, representing an increase of approximately 35.3% compared to approximately HK$11.6 million for the year ended 31 March 2020[45]. - The Group's administrative expenses for the year were approximately HK$15.7 million, an increase of about 35.3% compared to approximately HK$11.6 million for the year ended March 31, 2020[46]. - Finance costs decreased by approximately 8% to HK$107,000 from approximately HK$116,000 for the year ended March 31, 2020, mainly due to the repayment of bank borrowings[47]. Cash and Financial Position - As of March 31, 2021, the Group had total cash and bank balances of approximately HK$84.8 million, down from approximately HK$182.1 million in 2020[50]. - The Group's gearing ratio as of March 31, 2021, was approximately 1.3%, compared to approximately 0.3% in 2020[50]. - As of March 31, 2021, the Group had approximately HK$29.2 million of time deposits pledged for banking facilities, an increase from approximately HK$4.4 million in 2020[50]. - The net proceeds from the Listing amounted to approximately HK$78.9 million, slightly lower than the estimated HK$82.5 million[60]. - The total utilisation of proceeds from the Listing included HK$24.7 million for satisfying surety bond requirements, HK$28.6 million for upfront costs of awarded projects, and HK$6.9 million for expanding the project management team[62]. Market and Industry Outlook - The Group anticipates that the construction industry in Hong Kong will gradually recover under a more stabilized COVID-19 situation[27]. - The prices of certain raw materials have increased rapidly after the year, which will affect project costs and gross profit margins[28]. - The Group will continue to monitor raw material prices closely and take appropriate measures to mitigate risks and impacts on project costs[28]. - Despite near-term challenges, the Group remains focused on long-term goals and will explore suitable development opportunities to broaden its revenue base[29]. Corporate Governance and Management - The Company has adopted the corporate governance code as per Appendix 14 of the Listing Rules and has complied with it throughout the year, except for a deviation from code provision A.2.1[171]. - The Company prioritizes effective corporate governance practices to enhance shareholder value[167]. - The Board consists of five members, including two executive directors and three independent non-executive directors[170]. - The Company encourages Directors to attend relevant programs for professional development and has provided training materials regarding their duties and responsibilities[191]. - The Company established the Audit Committee on December 12, 2019, in compliance with the Listing Rules and the CG Code[199]. Shareholder and Dividend Information - The Board has resolved not to recommend the declaration of a final dividend to shareholders for the year[73]. - The Group's dividend policy allows shareholders to participate in profits while retaining reserves for future growth[73]. - As of March 31, 2021, the company had distributable reserves amounting to approximately HK$66.1 million[24]. Risks and Compliance - Risks include reliance on subcontractors, potential cash outflows affecting project acquisition, and changes in building material costs impacting profitability[66]. - There was no material non-compliance with relevant laws and regulations that significantly impacted the Group's operations during the year[70]. - The Group's financial performance and sustainability depend on securing new projects through competitive tendering processes[66].
华和控股(09938) - 2021 - 年度财报