龙升集团控股(06829) - 2025 - 中期业绩

Financial Highlights The group's financial performance for the six months ended September 30, 2024, shows increased revenue and profit, with a slight decrease in basic EPS and no interim dividend declared | Metric | Six Months Ended September 30, 2024 (HK$ million) | Six Months Ended September 30, 2023 (HK$ million) | | :--- | :--- | :--- | | Revenue | 471.8 | 331.3 | | Profit attributable to owners of the Company | 5.9 | 5.4 | | Basic and diluted earnings per share (HK cents) | 0.41 | 0.45 | | Interim dividend | Not declared | Nil | Condensed Consolidated Financial Statements This section presents the condensed consolidated financial statements, including the income statement and statement of financial position, for the reporting period Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income The Group's revenue significantly increased by 42.4% to HK$471.8 million, with profit attributable to owners of the Company also rising, though basic and diluted EPS slightly decreased due to increased share count | Metric | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 471,830 | 331,316 | | Direct costs | (447,968) | (308,086) | | Gross profit | 23,862 | 23,230 | | Profit for the period | 5,634 | 5,387 | | Profit for the period attributable to owners of the Company | 5,916 | 5,388 | | Basic and diluted earnings per share (HK cents) | 0.41 | 0.45 | - Total comprehensive income for the period increased from HK$5,387 thousand in 2023 to HK$6,255 thousand in 2024, primarily due to HK$621 thousand in exchange differences from translating foreign operations[9] Condensed Consolidated Statement of Financial Position As of September 30, 2024, the Group's total assets less current liabilities increased, driven by growth in net current assets and a significant decrease in current liabilities, leading to higher net assets and total equity | Metric | As at September 30, 2024 (HK$ thousand) | As at March 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Non-current assets | 24,658 | 26,622 | | Current assets | 359,975 | 392,558 | | Current liabilities | (91,466) | (147,033) | | Net current assets | 268,509 | 245,525 | | Total assets less current liabilities | 293,167 | 272,147 | | Net assets | 289,141 | 267,835 | | Total equity | 289,141 | 267,835 | - Equity attributable to owners of the Company increased from HK$267,497 thousand as of March 31, 2024, to HK$288,708 thousand as of September 30, 2024[24] Notes to the Condensed Consolidated Interim Financial Statements This section provides detailed notes and disclosures supporting the condensed consolidated interim financial statements, covering accounting policies, estimates, and specific financial items General Information The Group primarily operates as a foundation works subcontractor and trades building materials in Hong Kong, with its ultimate controlling shareholder being Mr. Yip Yuk Kit through Fame Circle Limited - The Company was incorporated in the Cayman Islands on February 22, 2017, and listed on the Stock Exchange of Hong Kong on February 8, 2018[28] - The Group is principally engaged in foundation works as a subcontractor and trading of building materials in Hong Kong[28] - The Company's immediate and ultimate holding company is Fame Circle Limited, wholly owned by Mr. Yip Yuk Kit[29] Basis of Preparation The condensed consolidated interim financial statements are prepared in accordance with HKAS 34 and Listing Rules, presented in HK$ thousand, and are unaudited - The condensed consolidated interim financial statements have been prepared in accordance with the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the Hong Kong Institute of Certified Public Accountants[30] - The condensed consolidated interim financial information is unaudited and presented in HK$ thousand[31] Adoption of New or Revised Hong Kong Financial Reporting Standards The Group adopted revised HKFRSs effective April 1, 2024, with no material impact on current or prior period results and financial position - The Group has adopted revised Hong Kong Financial Reporting Standards (HKFRSs) effective April 1, 2024, including HKFRS 16 (Amendments) and HKAS 1 (Amendments)[32] - The adoption of these revised HKFRSs had no material impact on the Group's results and financial position for the current and prior periods[32] Critical Accounting Judgements and Key Sources of Estimation Uncertainty The preparation of interim financial statements requires management's accounting judgments, estimates, and assumptions, consistent with those used for the annual financial statements as of March 31, 2024 - The preparation of the condensed consolidated interim financial statements requires management to make accounting judgments, estimates, and assumptions[35] - The significant judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the Group's annual consolidated financial statements for the year ended March 31, 2024[35] Revenue The Group's revenue increased from HK$331,316 thousand in 2023 to HK$471,830 thousand in 2024, driven by services transferred over time and new building material sales | Source of revenue | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Services transferred over time (contract revenue) | 418,071 | 331,316 | | Goods transferred at a point in time (sales of building materials) | 53,759 | – | | Total revenue | 471,830 | 331,316 | - Revenue from construction contracts is recognized over time, while revenue from sales of building materials is recognized at the point in time when control of the asset is transferred to the customer[38][39] Segment Information The Group operates as a single foundation works segment, with revenue and non-current assets primarily from Hong Kong, thus no segment analysis is presented, but major customer revenues exceeding 10% are disclosed - The Group's foundation works services business is considered a single operating segment, with revenue and non-current assets primarily derived from Hong Kong, thus no segment analysis is presented[41][42] | Customer | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Customer B | 128,507 | 171,877 | | Customer C | 156,207 | 43,594 | | Customer D | 94,396 | N/A | Other Income / (Losses), Net Other income / (losses) for the period shifted from a HK$1,286 thousand loss in 2023 to a HK$1,155 thousand gain, primarily due to new consulting fee income and a favorable exchange difference | Item | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Net loss on fair value change of investment properties | (420) | (440) | | Consulting fee income | 625 | – | | Rental income | 84 | 78 | | Interest income | 563 | 438 | | Net exchange differences | 303 | (1,141) | | Others | – | (221) | | Total | 1,155 | (1,286) | Finance Costs Finance costs for the period significantly increased to HK$2,111 thousand, a 2,000% rise from HK$140 thousand last year, mainly due to higher bank loan interest | Item | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Interest on bank loans | 2,018 | 98 | | Finance costs on lease liabilities | 93 | 42 | | Total | 2,111 | 140 | Profit Before Income Tax Profit before income tax was impacted by significant increases in staff costs, subcontracting expenses, and building material sales costs, while depreciation decreased | Item | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Staff costs (including directors' emoluments) | 90,668 | 63,264 | | Depreciation | 6,427 | 10,424 | | Subcontracting expenses | 60,998 | 49,290 | | Cost of sales of building materials | 50,609 | – | | Expected credit losses (reversal) / provision, net | (1,909) | 676 | - Of the staff costs (including directors' emoluments), HK$80,611 thousand were direct costs and HK$10,057 thousand were administrative expenses[55] Income Tax Expense Income tax expense decreased from HK$1,885 thousand in 2023 to HK$1,573 thousand in 2024, primarily due to a deferred tax credit, despite increases in Hong Kong profits tax and overseas tax | Item | Six Months Ended September 30, 2024 (HK$ thousand) | Six Months Ended September 30, 2023 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong profits tax | 1,577 | 205 | | Overseas tax | 585 | – | | Deferred tax | (589) | 1,680 | | Total income tax expense | 1,573 | 1,885 | - Hong Kong profits tax is calculated under the two-tiered profits tax regime, with the first HK$2 million of assessable profits taxed at 8.25% and the remainder at 16.5%[55] Dividends The Company neither paid nor declared any interim dividends for the six months ended September 30, 2024, consistent with the prior period - For the six months ended September 30, 2024, the Company neither paid nor declared any interim dividends (six months ended September 30, 2023: Nil)[58] Earnings Per Share Basic EPS attributable to owners of the Company decreased to 0.41 HK cents from 0.45 HK cents last year, despite increased profit, due to a higher weighted average number of ordinary shares outstanding | Metric | Six Months Ended September 30, 2024 | Six Months Ended September 30, 2023 | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company (HK$ thousand) | 5,916 | 5,388 | | Weighted average number of ordinary shares (thousand shares) | 1,440,000 | 1,200,000 | | Basic and diluted earnings per share (HK cents) | 0.41 | 0.45 | - There were no potential dilutive ordinary shares outstanding for the six months ended September 30, 2024, and 2023, thus diluted earnings per share equal basic earnings per share[60] Trade and Other Receivables As of September 30, 2024, total trade and other receivables significantly increased to HK$80,135 thousand, driven by higher trade receivables and prepayments, with a corresponding increase in expected credit loss provisions | Item | As at September 30, 2024 (HK$ thousand) | As at March 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade receivables - from third parties (net of provision) | 74,097 | 28,726 | | Deposits, prepayments and other receivables | 6,038 | 1,651 | | Total | 80,135 | 30,377 | - Prepayments for purchases of materials increased from HK$408 thousand as of March 31, 2024, to HK$3,735 thousand as of September 30, 2024[63] | Ageing of trade receivables (net of provision) | As at September 30, 2024 (HK$ thousand) | As at March 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 55,925 | 22,868 | | 31 to 60 days | 11,509 | 4,894 | | 61 to 90 days | 6,663 | 964 | | Total | 74,097 | 28,726 | Contract Assets As of September 30, 2024, total contract assets slightly decreased to HK$216,474 thousand, with a reduction in unbilled revenue offset by a significant increase in retention receivables, and a decrease in expected credit loss provisions | Item | As at September 30, 2024 (HK$ thousand) | As at March 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Unbilled revenue | 70,301 | 161,438 | | Retention receivables | 149,060 | 72,282 | | Less: Provision for expected credit losses, net | (2,887) | (5,501) | | Total | 216,474 | 228,219 | - Contract assets expected to be recovered/settled in more than one year amounted to HK$72,194 thousand (March 31, 2024: HK$29,751 thousand)[70] Trade and Other Payables As of September 30, 2024, total trade and other payables significantly decreased to HK$34,586 thousand, primarily due to a substantial reduction in trade payables, despite an increase in accrued expenses and other payables | Item | As at September 30, 2024 (HK$ thousand) | As at March 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade payables | 26,568 | 80,159 | | Accrued expenses and other payables | 8,018 | 5,514 | | Total | 34,586 | 85,673 | | Ageing of trade payables | As at September 30, 2024 (HK$ thousand) | As at March 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 24,959 | 72,258 | | 31 to 60 days | 1,230 | 6,667 | | 61 to 90 days | 379 | 1,234 | | Total | 26,568 | 80,159 | - Accrued expenses and other payables primarily include HK$3,753 thousand for accrued professional fees, HK$1,665 thousand for accrued employee benefits, and HK$1,808 thousand payable to a director[72] Share Capital The Company completed a placement of 240,000,000 shares in August 2024, increasing issued share capital to HK$14,400 thousand and total ordinary shares to 1,440,000,000 | Item | Number of shares | HK$ thousand | | :--- | :--- | :--- | | As at March 31, 2024 (audited) | 1,200,000,000 | 12,000 | | Shares placed | 240,000,000 | 2,400 | | As at September 30, 2024 (unaudited) | 1,440,000,000 | 14,400 | - The placement of shares was completed on August 9, 2024, at a placing price of HK$0.064 per share[74] Management Discussion and Analysis This section provides an overview of the Group's business, financial performance, liquidity, and capital structure, along with an industry review and future outlook Industry Review Hong Kong's economy showed recovery in H1 2024, with 3.3% GDP growth in Q2, and construction output increased, though the foundation industry saw a decline in total value despite sufficient project numbers - The Hong Kong economy showed signs of recovery in the first half of 2024, with real Gross Domestic Product (GDP) increasing by 3.3% year-on-year in the second quarter[76] - The nominal gross value of construction works reached HK$68.3 billion, an increase of 2.3% compared to the same period in 2023, primarily driven by increased public sector initiatives[76] - The total value of piling and related foundation works in the foundation industry decreased by 14.3% to HK$469.2 million in Q1 2024 and further by 20.5% to HK$442.8 million in Q2 2024[77] Business Review and Outlook The Group, an experienced foundation works subcontractor in Hong Kong, is exploring new opportunities in renewable energy, modular integrated construction, and building material trading, achieving 42.4% revenue growth and 3.7% net profit growth in the period, while facing skilled labor shortages despite positive economic forecasts - The Group is an experienced foundation works subcontractor in Hong Kong, primarily engaged in foundation construction for commercial and residential buildings[78] - The Group has begun exploring new opportunities, including projects in the new energy sector, adopting modular integrated construction techniques, and trading building materials[80] | Metric | Six Months Ended September 30, 2024 (HK$ million) | Six Months Ended September 30, 2023 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 471.8 | 331.3 | +42.4% | | Gross profit | 23.9 | 23.2 | +3.0% | | Net profit | 5.6 | 5.4 | +3.7% | - The Hong Kong government forecasts real GDP growth between 2.5-3.5% for 2024, with average annual infrastructure spending of approximately HK$90 billion, an increase of about 17% from the past five-year average of HK$76 billion[80][81] - The construction industry faces a structural challenge of skilled labor shortages, with a projected labor supply-demand gap of up to 55,000 people by 2027, which is expected to drive up labor costs[81] Financial Review The Group's financial performance showed significant revenue growth but a lower gross profit margin due to less profitable projects; other income turned positive, administrative and finance costs rose, while income tax expense decreased, resulting in a slight net profit increase Revenue The Group's revenue increased by 42.4% to HK$471.8 million, primarily driven by an increase in the number of large-scale projects - During the reporting period, the Group's revenue increased by approximately HK$140.5 million, or approximately 42.4%, from approximately HK$331.3 million in the same period of 2023 to approximately HK$471.8 million[83] - This increase was primarily due to an increase in the number of large-scale projects[83] Gross Profit and Gross Profit Margin Gross profit increased by 3.0% to HK$23.9 million, but the gross profit margin decreased to 5.1% due to lower profitability of certain projects - The Group's gross profit increased by approximately HK$0.7 million, or approximately 3.0%, from approximately HK$23.2 million in the same period of 2023 to approximately HK$23.9 million[84] - The Group's gross profit margin for the reporting period was approximately 5.1%, compared to approximately 7.0% in the same period of 2023, primarily due to lower profit margins on certain projects[84] Other Income / Losses Other income shifted from a HK$1.3 million loss in 2023 to a HK$1.2 million gain, driven by new consulting fees and favorable exchange differences - During the reporting period, other income increased by approximately HK$2.5 million, or approximately 192.3%, from a loss of approximately HK$1.3 million in the same period of 2023 to a gain of approximately HK$1.2 million[85] - The increase in income was primarily due to (1) new consulting fee income of approximately HK$0.6 million; and (2) an increase in exchange difference gains from a loss of approximately HK$1.1 million in the same period of 2023 to a gain of approximately HK$0.3 million, an increase of approximately HK$1.4 million[85] Administrative Expenses Administrative expenses increased by 26.6% to HK$17.6 million, primarily due to higher staff costs - During the reporting period, administrative expenses increased by approximately HK$3.7 million, or approximately 26.6%, from approximately HK$13.9 million in the same period of 2023 to approximately HK$17.6 million[86] - This increase was primarily due to higher staff costs[86] Finance Costs Finance costs surged by 2,000% to HK$2.1 million, mainly attributable to increased average borrowings during the period - During the reporting period, finance costs increased by approximately HK$2.0 million, or approximately 2,000.0%, from approximately HK$140 thousand in the same period of 2023 to approximately HK$2.1 million[88] - The increase in finance costs was primarily due to an increase in average borrowings during the reporting period[88] Income Tax Expense Income tax expense decreased by 15.8% to HK$1.6 million, primarily due to an increase in deferred tax credits - During the reporting period, income tax expense decreased by approximately HK$0.3 million, or approximately 15.8%, from approximately HK$1.9 million in the same period of 2023 to approximately HK$1.6 million[89] - This decrease was due to an increase in deferred tax credits during the reporting period[89] Net Profit Net profit increased by 3.7% to HK$5.6 million, primarily driven by the increase in gross profit - During the reporting period, net profit increased by approximately HK$0.2 million, or approximately 3.7%, from approximately HK$5.4 million in the same period of 2023 to approximately HK$5.6 million[90] - This increase was primarily due to the effect of increased gross profit[90] Liquidity, Financial Position and Capital Structure The Group's total cash and bank balances decreased due to higher trade receivables, while short-term bank borrowings and corporate bonds declined, improving the gearing ratio from 23.1% to 19.2% - As at September 30, 2024, the Company's issued share capital was HK$14.4 million, with 1,440,000,000 ordinary shares in issue[91] - As at September 30, 2024, the Group had total cash, bank balances, and pledged bank deposits of approximately HK$63.4 million (March 31, 2024: approximately HK$134.0 million), with this decrease primarily due to an increase in trade receivables[91] - As at September 30, 2024, the Group's short-term bank borrowings and corporate bonds amounted to approximately HK$50.7 million (March 31, 2024: approximately HK$58.5 million)[93] - The Group's gearing ratio (calculated as total borrowings, including lease liabilities, divided by total equity) was approximately 19.2% (March 31, 2024: approximately 23.1%)[93] Treasury Policy The Group adopts a prudent financial approach to its treasury policy, with the Board closely monitoring liquidity to ensure continuous fulfillment of funding requirements - The Group adopts a prudent financial approach to its treasury policy[94] - The Board closely monitors the Group's liquidity position to ensure that the liquidity structure of the Group's assets, liabilities, and other commitments can continuously meet its funding needs[94] Pledge of Group Assets As of September 30, 2024, the Group pledged investment properties in Hong Kong worth HK$3.5 million, along with bank deposits of HK$19.8 million and RMB13.0 million, to secure bank facilities - As at September 30, 2024, the Group pledged (i) investment properties in Hong Kong of approximately HK$3.5 million; and (ii) bank deposits of approximately HK$19.8 million and RMB13.0 million to secure bank facilities for Kit Kee Engineering[95] Exposure to Exchange Rate Risk Despite holding RMB bank deposits, the Board considers the Group's exchange rate risk to be insignificant as most operations and transactions are settled in HKD, thus no derivative contracts were entered into for hedging - The Group primarily operates in Hong Kong, with most revenue and transactions generated from operations settled in Hong Kong Dollars, thus the Directors consider the Group's exchange rate risk to be insignificant[96] - The Group did not enter into any derivative contracts to hedge exchange rate risk during the reporting period[96] Capital Expenditure During the reporting period, the Group invested approximately HK$0.3 million in property, plant, and equipment, with all capital expenditure funded by internal resources - During the reporting period, the Group incurred approximately HK$0.3 million for the purchase of property, plant, and equipment[97] - All such capital expenditure was funded by internal resources[97] Capital Commitments and Contingent Liabilities As of September 30, 2024, the Group had no significant capital commitments and, despite various claims related to work injuries and non-compliance, the Directors do not expect a material impact on the consolidated financial statements - As at September 30, 2024, the Group had no significant capital commitments (March 31, 2024: Nil)[99] - The Group is involved in various claims, litigations, and potential claims related to work injuries and non-compliance incidents, but the Directors believe these claims are not expected to have a material impact on the consolidated financial statements[99] Segment Information The Board considers the Group's business as a single operating segment, with revenue and non-current assets primarily from Hong Kong, thus no segment analysis is reported - The Board views the Group's business as a single operating segment and reviews the Group's overall results to make decisions on resource allocation[100] - As the Group's revenue and non-current assets are primarily derived from a single geographical location (Hong Kong), no separate analysis of segment information by geographical segment is presented[100] Material Investments, Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures During the reporting period, the Group held no material investments and undertook no material acquisitions or disposals of subsidiaries, associates, or joint ventures - During the reporting period, the Group held no material investments and there were no material acquisitions or disposals of subsidiaries, associates, or joint ventures[101] Future Plans for Material Investments or Capital Assets During the reporting period, the Group had no plans for any material investments or capital assets - During the reporting period, the Group had no plans for any material investments or capital assets[102] Interim Dividend The Board resolved not to declare any interim dividend for the reporting period, consistent with the prior year - The Board resolved not to declare any interim dividend for the reporting period (six months ended September 30, 2023: Nil)[103] Placement of New Shares under General Mandate in August 2024 In August 2024, the Company placed 240,000,000 shares under general mandate, raising net proceeds of approximately HK$14.9 million, fully utilized for the Group's general working capital - In August 2024, the Company placed 240,000,000 shares to not less than six placees at a placing price of HK$0.064 per share under a general mandate[105] - The placement raised net proceeds of approximately HK$14.9 million, which have been fully utilized for the Group's general working capital[105][106] Employees and Remuneration Policy As of September 30, 2024, the Group employed 425 full-time employees, an increase from 338 as of March 31, 2024, with total staff costs of approximately HK$90.7 million for the period, and remuneration based on qualifications, position, and experience with annual reviews - As at September 30, 2024, the Group employed a total of 425 full-time employees (March 31, 2024: 338 employees)[107] - During the reporting period, the Group incurred total staff costs of approximately HK$90.7 million, compared to approximately HK$63.3 million in the same period of 2023[107] - Remuneration packages, including salaries, discretionary bonuses, and other cash allowances, are determined based on employees' qualifications, position, and experience, with an annual review system in place[107] Events After the Reporting Period On September 13, 2024, the Company announced a proposed share consolidation of ten shares into one, and a rights issue of up to 144,000,000 new shares to raise up to HK$28.8 million, with the transactions not yet completed - On September 13, 2024, the Company announced a proposed share consolidation of every ten (10) issued shares of HK$0.01 par value into one (1) consolidated share of HK$0.10 par value[108] - The Company further announced a rights issue of up to 144,000,000 new shares at a subscription price of HK$0.20 per share, aiming to raise gross proceeds of up to approximately HK$28.8 million[108] - The rights issue is on the basis of one (1) rights share for every one (1) consolidated share held on the record date of November 25, 2024, and as of the date of this announcement, the transactions have not yet been completed[108] Corporate Governance / Other Information This section details the Company's corporate governance practices, including directors' and major shareholders' interests, share option schemes, and compliance with governance codes Directors' and Chief Executive's Interests in Shares, Underlying Shares and Debentures of the Company and its Associated Corporations As of September 30, 2024, Mr. Yip Yuk Kit held a 61.8% equity interest in the Company through his wholly-owned Fame Circle Limited, where he also holds a 100% beneficial interest | Name of Director | Capacity / Nature of interest | Number of ordinary shares held / interested | Percentage of shareholding | | :--- | :--- | :--- | :--- | | Mr. Yip Yuk Kit | Interest in controlled corporation | 890,000,000 | 61.8% | - The Company is 61.8% owned by Fame Circle Limited, which is legally and beneficially 100% owned by Mr. Yip[111] | Name of Director | Name of associated corporation | Capacity / Nature of interest | Number of ordinary shares held / interested | Percentage of shareholding | | :--- | :--- | :--- | :--- | | Mr. Yip Yuk Kit | Fame Circle Limited | Beneficial interest | 50,000 | 100% | Substantial Shareholders' and Other Shareholders' Interests in Shares and Underlying Shares As of September 30, 2024, Fame Circle Limited was the Company's substantial shareholder with a 61.8% equity interest, and Ms. Yip Lai Ping, spouse of Mr. Yip Yuk Kit, was deemed to have an interest in the same number of shares | Name | Capacity / Nature of interest | Number of shares held / interested | Percentage of interest | | :--- | :--- | :--- | :--- | | Fame Circle Limited | Beneficial interest | 890,000,000 | 61.8% | | Ms. Yip Lai Ping | Interest of spouse | 890,000,000 | 61.8% | - Fame Circle Limited is 100% owned by Mr. Yip, and Ms. Yip Lai Ping, Mr. Yip's spouse, is deemed under the Securities and Futures Ordinance to have an interest in the same number of shares as Mr. Yip[115][116] Share Option Scheme The Company adopted a share option scheme on January 18, 2018, to attract and retain talent; no options have been granted, exercised, cancelled, or lapsed since adoption, and no outstanding options existed as of September 30, 2024 - The Company adopted a share option scheme on January 18, 2018, to attract and retain the best talent within the Group and provide additional incentives[118] - Since its adoption, no share options have been granted, exercised, cancelled, or lapsed under the share option scheme, and there were no outstanding share options as at September 30, 2024[118] Purchase, Sale or Redemption of the Company's Securities During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's securities - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's securities[119] Directors' Interests in Material Contracts During the reporting period, no Director had a direct or indirect material interest in any contract significant to the Group's business to which the Company or any of its subsidiaries was a party - During the reporting period, no Director had a direct or indirect material interest in any contract significant to the Group's business to which the Company or any of its subsidiaries was a party[120] Sufficiency of Public Float The Directors confirm that the Company maintained a sufficient public float for its shares as required by the Listing Rules throughout the reporting period and up to the date of this announcement - The Directors confirm that the Company maintained a sufficient public float for its shares as required by the Listing Rules throughout the reporting period and up to the date of this announcement[121] Competing Interests The Directors confirm that no Director, controlling shareholder, substantial shareholder, or their respective close associates held any interest in businesses directly or indirectly competing with the Group during the reporting period - The Directors confirm that no Director, controlling shareholder, substantial shareholder, or their respective close associates held any interest in any business that directly or indirectly competes or may compete with the Group's business during the reporting period[122] Corporate Governance Practices The Group is committed to good corporate governance, adopting the Corporate Governance Code, with the Board deeming the combined Chairman and CEO role to be in the Group's best interest, and all Directors confirming compliance with the Model Code for securities transactions Compliance with the Corporate Governance Code The Company adopted the Corporate Governance Code, with a deviation for the combined Chairman and CEO role, which the Board believes is in the Group's best interest - The Company has adopted the Corporate Governance Code as set out in Appendix C1 Part 2 of the Listing Rules[124] - During the reporting period, Mr. Yip served as both Chairman and Chief Executive Officer, which constitutes a deviation from Code Provision C.2.1, but the Board believes this is in the best interests of the Group[124] - Save for the aforementioned deviation, the Board considers that the Company has complied with all code provisions set out in the Corporate Governance Code during the reporting period[125] Compliance with the Model Code for Securities Transactions by Directors The Company adopted the Model Code for Directors' securities transactions, and all Directors confirmed compliance throughout the reporting period - The Company has adopted the Model Code as set out in Appendix C3 of the Listing Rules as its code of conduct for Directors' securities transactions[126] - Following specific enquiries with all Directors, all Directors confirmed their compliance with the Model Code and the code of conduct for Directors' securities transactions at all applicable times during the reporting period[126] Audit Committee The Company's Audit Committee, established in 2018 and chaired by Mr. Li Kwok Lun, comprises three independent non-executive Directors, responsible for recommending external auditors, overseeing financial statement integrity, and reviewing financial controls, internal controls, and risk management systems - The Company established an Audit Committee on January 18, 2018, comprising three independent non-executive Directors: Mr. Chan Wah Sing, Mr. Chan Ka Yu, and Mr. Li Kwok Lun[127][129] - Mr. Li Kwok Lun is the Chairman of the Audit Committee[129] - The Audit Committee's primary responsibilities include recommending the appointment, re-appointment, and removal of external auditors, overseeing the integrity of financial statements and annual reports, and reviewing financial controls, internal control, and risk management systems[127] Review of Interim Results The Group's unaudited interim financial results for the review period were reviewed and approved by the Audit Committee, which deemed them prepared in compliance with applicable accounting standards, regulations, and Listing Rules, with adequate disclosure - The Group's interim financial results for the review period are unaudited but have been reviewed and approved by the Audit Committee[130] - The Audit Committee believes that the preparation of these results complied with applicable accounting standards, regulations, and the Listing Rules, and that adequate disclosures have been made[130] Acknowledgement The Board extends its sincere gratitude to the management team, staff, shareholders, investors, and business partners for their tireless efforts, contributions, trust, and support - The Board takes this opportunity to express its sincere gratitude to the management team and staff for their tireless efforts and contributions, and to the shareholders, investors, and business partners for their trust and support[131] Publication of Unaudited Interim Results Announcement and Interim Report The Company's interim results announcement is published on the Stock Exchange and Company websites, and the interim report, containing all Listing Rules-required information, will be dispatched to shareholders and posted online in due course - The Company's interim results announcement is published on the Stock Exchange website (www.hkexnews.hk) and the Company's website (www.kitkee.com.hk)[132](index=132&type=chunk) - The Company's interim report for the reporting period, containing all relevant information required by the Listing Rules, will be dispatched to the Company's shareholders and posted on the Stock Exchange website and the Company's website in due course[132]