Financial Performance - The total revenue of the Group increased by approximately HK$62.2 million or 54.3% from approximately HK$114.6 million for the year ended December 31, 2023, to approximately HK$176.8 million for the Relevant Period[20]. - Gross profit of the Group increased by approximately HK$15.8 million from approximately HK$3.1 million for the year ended December 31, 2023, to approximately HK$18.9 million for the Relevant Period[20]. - The Group recorded a profit of approximately HK$1.1 million for the Relevant Period, a turnaround from a loss of approximately HK$35.9 million in the corresponding period in 2023[31]. - Revenue increased by approximately HK$62.2 million, from approximately HK$114.6 million for the year ended 31 December 2023 to approximately HK$176.8 million for the Relevant Period, representing an increase of approximately 54.3%[35]. - The cost of sales increased from approximately HK$111.5 million for the year ended 31 December 2023 to approximately HK$157.9 million for the Relevant Period, representing an increase of approximately 41.6%[36]. - Gross profit increased by approximately HK$15.8 million from approximately HK$3.1 million for the year ended 31 December 2023 to approximately HK$18.9 million for the Relevant Period, with the gross profit margin increasing from approximately 2.7% to approximately 10.7%[41]. - The contribution of existing projects in Kai Tak to total revenue increased from approximately 17.1% to about 78.4%[45]. Market Conditions - The Group faced intensified competition in the construction industry due to a lack of large construction projects, heightened financial costs, and a chronic shortage of skilled labor[18]. - The overall market sentiment remained weak during the Relevant Period despite modest growth in local and global economies[18]. - The Group's strategic challenges were exacerbated by rising inflation and prolonged geopolitical uncertainties[18]. - The overall market sentiment remained weak, with intensified competition in the construction industry due to a lack of large construction projects and rising financial costs[30]. Projects and Opportunities - A new project was awarded to the Group with an initial contract sum exceeding HK$383 million in March 2024, marking the largest contract the Group has ever been awarded in Hong Kong[19]. - The Group will continue to monitor ongoing projects and identify suitable tender opportunities to maximize profits and returns to shareholders[19]. - The Group will continue to explore cooperation with new customers and derive new revenue streams while optimizing resource utilization and efficiencies[34]. - The Group will regularly monitor the progress of ongoing projects and identify suitable tender opportunities to maximize profits and returns to shareholders[31]. Administrative and Financial Management - The Group's administrative expenses remained relatively stable at approximately HK$18.3 million during the Relevant Period[42]. - The Group recorded an income tax expense of approximately HK$2.1 million for the Relevant Period, compared to an income tax credit of approximately HK$4.4 million for the year ended 31 December 2023[43]. - Total assets as of December 31, 2024, were approximately HK$126.1 million, down from approximately HK$130.8 million in 2023[49]. - Total interest-bearing borrowings decreased from approximately HK$27.3 million as of December 31, 2023, to approximately HK$25.2 million as of December 31, 2024[50]. - Current ratio improved from 1.8 times to approximately 2.0 times during the same period[50]. - Gearing ratio decreased from approximately 43.2% to about 38.0% due to reduced borrowings and increased retained earnings[52]. - Administrative expenses remained stable at approximately HK$18.3 million compared to HK$18.4 million in 2023[46]. - Income tax expense for the relevant period was approximately HK$2.1 million, while a tax credit of about HK$4.4 million was recorded for the year ended December 31, 2023[47]. Corporate Governance - The Group's corporate governance practices comply with the Corporate Governance Code, ensuring proper regulation of business activities[92]. - The Board believes that separating the roles of chairman and CEO is important for effective management, but Mr. Chung currently holds both positions for the Group's best interest[93]. - The Group emphasizes the importance of corporate governance for long-term success and has adopted the principles outlined in the GEM Listing Rules[94]. - The Board is responsible for overall management and strategic direction, with management delegated authority for day-to-day operations[103]. - The Company has appointed three independent non-executive Directors, representing at least one-third of the Board, ensuring compliance with GEM Listing Rules[108]. - The Board believes that the diverse backgrounds of independent non-executive Directors enhance accountability and independent decision-making[109]. - The Group is committed to high standards of business ethics and corporate governance, with explicit standards set for all employees[96]. - The Company aims to maintain at least the current level of female representation on the Board[122]. - The Board Diversity Policy was amended in March 2024, focusing on achieving diversity in skills, experience, and perspectives[123]. - The Audit Committee is composed entirely of INEDs, exceeding the independence requirements under the Listing Rules[114]. - The Company has established effective mechanisms to support an independent Board and ensure independent views are available[113]. - The Board's composition reflects diversity in education, professional background, gender, age, culture, and industry experience[119]. - The Company will continue to maintain gender diversity in its workforce and has initiatives in place to improve this aspect[126]. Risk Management - The Group has established risk management policies to identify major risks associated with its business and industry[184]. - An external independent consultant reviewed the Group's internal control systems, and no material deficiencies were identified[185]. - The Audit Committee conducted a review of the effectiveness of the risk management and internal control system during the Relevant Period[186]. - The Group implemented necessary internal control measures based on recommendations from the external consultant, confirming their satisfactory implementation[187]. - The Group considers its risk management and internal control systems effective and adequate[188]. - The Board and senior management are responsible for preparing and measuring risk mitigation plans and reporting on risk management status[184]. - The Group's internal control guidance covers operations related to subcontracting, purchasing, expenditure, and human resources[185]. - The Group adopted an Anti-Corruption Policy in August 2022 to mitigate bribery and corruption risks[192]. - No incidents of fraud or misconduct with a material effect on the Group's financial statements were reported during the Relevant Period[195]. Shareholder Returns - The Company has a Dividend Policy aimed at providing stable and sustainable returns to shareholders[198]. - The Board considers various factors, including earnings performance and cash flows, when proposing dividends, with no assurance of specific amounts being declared[199]. Board Meetings and Committees - The Board has held four meetings during the Relevant Period to approve interim and annual financial results and review business strategies[129]. - The Company has established three board committees: Audit Committee, Remuneration Committee, and Nomination Committee, to oversee specific aspects of the Group's affairs[146]. - The Audit Committee held two meetings during the Relevant Period to review annual and interim financial results, internal control, and risk management[151]. - The Remuneration Committee reviewed the remuneration structure of Directors during one meeting in the Relevant Period[158]. - The Nomination Committee is responsible for reviewing the Board's structure and composition annually and assessing the independence of independent non-executive Directors[168]. - The Company Secretary undertook more than 15 hours of professional training to update skills and knowledge as required by the GEM Listing Rules[176]. - The Directors acknowledge their responsibility for preparing financial statements that provide a true and fair view of the Group's state of affairs[177].
荣丰集团亚洲(08526) - 2024 - 年度财报