Financial Performance - The group's total revenue for the reporting period was approximately HKD 613.0 million, representing a significant increase of about 10.0% compared to HKD 557.2 million in the previous year[7]. - The profit attributable to the company's owners for the year was approximately HKD 34.1 million, a substantial decrease of about 40.1% from HKD 56.9 million in the previous year[7]. - The company recorded a revenue of approximately HKD 613.0 million for the reporting period, a significant increase of about 10.0% compared to HKD 557.2 million in the same period last year[20]. - The automotive beauty and maintenance products segment generated revenue of approximately HKD 484.8 million, up about 8.8% from HKD 445.5 million in the previous year, primarily due to effective e-commerce sales strategies on multiple online platforms[21]. - The personal care products segment reported revenue of approximately HKD 128.2 million, a substantial increase of about 14.7% from HKD 111.7 million in the previous year, driven by increased demand from a major overseas customer[22]. - The company's gross profit was approximately HKD 227.2 million, representing a significant increase of about 29.2% compared to HKD 175.9 million in the previous year, attributed to effective e-commerce strategies and lower raw material prices[24]. - Other income and gains amounted to approximately HKD 13.6 million, a substantial increase of about 56.9% from HKD 8.6 million in the previous year, mainly due to increased sales of waste and recyclable materials[25]. - Selling and distribution expenses rose significantly to approximately HKD 90.0 million, an increase of about 161.8% from HKD 34.4 million in the previous year, primarily due to higher advertising and promotional expenses[26]. - Administrative expenses increased to approximately HKD 58.0 million, a rise of about 12.2% from HKD 51.7 million in the previous year, mainly due to higher employee salaries and benefits[27]. - The company reported a net profit of approximately HKD 34.1 million, a significant decrease of about 39.9% from HKD 56.7 million in the previous year, primarily due to increased selling and distribution expenses and asset impairment provisions[29]. Dividend and Shareholder Information - The board has proposed a final dividend of HKD 0.0219 per share, down from HKD 0.0364 per share in the previous year[8]. - The company has adopted a dividend policy prioritizing cash distributions to shareholders, with decisions based on financial performance and capital needs[97]. - The company maintains a shareholder communication policy to ensure timely and equal access to relevant information for shareholders and potential investors[98]. - The company will hold an annual general meeting to provide a communication platform between shareholders and the board[91]. - The company has reviewed its shareholder communication policy and confirmed its effective implementation as of December 31, 2024[103]. - The company encourages shareholders to access corporate communications via its website to reduce environmental impact[101]. Market and Business Development - The group continues to allocate more resources to develop its Original Brand Manufacturing (OBM) business, with significant growth in online sales reflecting the ongoing implementation of e-commerce strategies in China[16]. - The group plans to enhance brand awareness through sponsorship of exhibitions, public relations activities, and multimedia platforms to promote its corporate image and brand[16]. - The group aims to strengthen its self-owned brand promotion and expand new markets to consolidate and enhance its business development[10]. - The group is optimistic about its domestic market and OBM business, focusing on improving existing OBM product lines with environmentally friendly formulas and strict cost control[11]. - The group will continue to participate in various exhibitions in China and globally to meet market demand and adjust its strategies accordingly[10]. - The group believes in the growth potential of the new Baobao Long series of automotive beauty and maintenance products, although other products under the Baoci Li brand will remain the main source of revenue in the short term[16]. Economic and Industry Context - The group recorded a GDP growth of 5.0% in China, driven by strong domestic consumption and strategic economic policies, although recovery remains fragile due to global economic uncertainties[11]. Corporate Governance - The board consists of four executive directors and three independent non-executive directors, ensuring high independence and effective decision-making[54]. - The company has adopted a competitive yet reasonable remuneration policy for directors to attract and retain qualified individuals[40]. - The board consists of 5 male directors and 2 female directors, with a goal to increase the proportion of female directors to over 25% in the coming years[61]. - The company has adopted a nomination policy to enhance board diversity and governance standards, considering factors such as gender, age, cultural background, and professional experience[65]. - All directors have participated in ongoing professional development to enhance their knowledge and skills, ensuring informed contributions to the board[59]. - The company has mechanisms in place to ensure independent opinions are obtained, including annual reviews of the board's composition and the independence of non-executive directors[63]. - The board has established a diversity policy, recognizing the benefits of a diverse board in improving performance and achieving strategic goals[61]. - The company has a formal process for the appointment and re-election of directors, ensuring transparency and adherence to governance standards[57]. - Independent non-executive directors have confirmed their independence in accordance with listing rules, and the company believes all such directors are independent[63]. - The board's succession planning is included in the nomination policy to address potential vacancies due to resignations or other circumstances[65]. - The board of directors held 4 meetings during the reporting period, with all members attending 100% of the meetings[68]. - The Audit Committee was established on May 27, 2019, and held 2 meetings to discuss audit and financial reporting issues[70][71]. - The Remuneration Committee, also established on May 27, 2019, held 1 meeting to review the group's remuneration policies and director compensation[75]. - The Nomination Committee, established on May 27, 2019, held 1 meeting to review the current board structure and ensure adequate composition[80]. - The company engaged Ernst & Young as the external auditor for financial reporting during the reporting period[83]. - The board is committed to maintaining high standards of corporate governance and regularly reviews its governance policies[82]. - Independent professional advice is sought by board members when necessary to fulfill their duties[67]. - The company ensures that independent non-executive directors constitute a majority in the Remuneration Committee[75]. - The Audit Committee's scope includes reviewing financial statements and monitoring risk management and internal control systems[70]. - The company has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee, to oversee specific areas[68]. Risk Management - The company emphasizes the importance of maintaining a robust risk management and internal control system to achieve business objectives and sustainable growth[107]. - The board has overall responsibility for assessing and determining the nature and extent of risks the company is willing to take to achieve strategic goals[109]. - Financial risks include potential misuse of funds, inadequate budget management, and compliance issues with accounting regulations[110]. - The company has implemented a comprehensive annual budget and a budget execution responsibility system to mitigate financial risks[110]. - Operational risks involve ensuring product safety and environmental standards, as well as managing human resources and supply chains effectively[112]. - The company actively monitors dust, high temperatures, and chemical hazards, and has established energy-saving and emission reduction plans[112]. - Legal risks include potential contract violations and intellectual property protection issues, which the company addresses through contract review and regular legal support[113]. - The board has established an internal audit department to continuously monitor the effectiveness of the risk management and internal control systems[114]. Environmental, Social, and Governance (ESG) - The company has committed to evaluating its business impact on significant environmental, social, and governance issues and will report the findings[119]. - The report adheres to the Hong Kong Stock Exchange's guidelines for environmental, social, and governance reporting, ensuring compliance with mandatory disclosure requirements[120]. - The company has established an environmental, social, and governance (ESG) framework to promote and implement its sustainability strategy[126]. - The board of directors is responsible for guiding the company's sustainable development direction and overseeing ESG work[126]. - The company has identified key stakeholders and regularly interacts with them through various communication channels[130]. - Stakeholders, including government, shareholders, employees, and customers, have specific concerns such as legal compliance, investment returns, employee rights, and product quality[131]. - The company is committed to minimizing its environmental impact and maintaining green operations in compliance with relevant environmental laws and regulations in China and Thailand[135]. - The company has implemented key measures and procedures for controlling air pollutants, greenhouse gas emissions, and waste management[135]. - The company emphasizes the importance of employee rights, workplace safety, and career development opportunities[136]. - The company has not been aware of any serious violations regarding emissions and waste management laws during the reporting period[135]. - The ESG working group is responsible for implementing ESG strategies and reporting progress to the board[126]. - The company aims to enhance its ESG risk management and improve its overall ESG performance[126]. - The company has implemented the latest 2020 National VI emission standard models for its fleet to improve exhaust emissions[139]. - In 2024, the company's energy consumption increased by approximately 8% compared to 2023, primarily from production machinery and vehicles[147]. - The company aims to maintain zero serious violations related to exhaust, greenhouse gas, and waste emissions over the next five years[144]. - The main source of greenhouse gas emissions in 2024 comes from Scope 2, accounting for 85% of total emissions[140]. - The company is actively researching and developing environmentally friendly formulations, such as water-based and low-VOC products[145]. - The company has established an environmental management system for aerosol and non-aerosol product production, certified under ISO 14001[145]. - The company has implemented energy-saving measures and aims to improve resource usage efficiency, particularly in water and energy consumption[147]. - The company has engaged qualified third-party pollution monitoring companies to review and supervise its pollutant emissions annually[141]. - The company is committed to reducing harmful waste and has developed detailed environmental protection rules and guidelines for employees[141]. - The company promotes green production practices and encourages employees to reduce waste, such as reusing paper and using electronic approval systems[145]. - The company has implemented various emergency response mechanisms to address climate-related risks, including purchasing adequate natural disaster insurance[154]. - The company identifies and assesses climate-related risks through its Environmental, Social, and Governance (ESG) working group, which updates the board on climate regulations and industry benchmarks[154]. Employee and Training Initiatives - The company emphasizes the importance of attracting and retaining talented employees, recognizing that a professional team is its most valuable asset[155]. - The company conducts annual reviews of employee performance to determine bonus levels, salary adjustments, and promotions[157]. - The company has established a safety management department to ensure compliance with national and local safety production laws and regulations[159]. - The company provides safety training courses and organizes emergency drills to enhance employees' emergency awareness and capabilities[159]. - The company has implemented measures to reduce noise pollution in the workplace, including using low-noise equipment and providing ear protection for employees[160]. - A total of 455 employees participated in various training sessions, accumulating 12,720 hours of training during the reporting period[168]. - Training topics included fire safety training, emergency response for occupational injuries, and practical skills for handling fire-related incidents[168]. - The percentage of trained employees rose to 97.2% in 2024, up from 94.9% in 2023, indicating improved training initiatives[196]. - The average training hours per employee increased to 27.2 hours in 2024 from 24.2 hours in 2023, reflecting a commitment to employee development[196]. Supply Chain and Quality Assurance - The company has established a quality assurance team to oversee supplier and raw material quality control, ensuring compliance with industry standards[174]. - The company has received multiple certifications for its quality management systems, including ISO 9001:2015 and ISO 14001:2015, demonstrating its commitment to high standards[175]. - Quality control measures are implemented at various stages of production to ensure compliance with applicable industry standards[176]. - The company conducts pre-storage inspections and pre-delivery testing to ensure products meet specifications before reaching customers[178][179]. - The company maintains stable relationships with suppliers to avoid over-reliance on any single source, ensuring a consistent supply of quality materials[171]. - 202 suppliers passed the company's quality assurance audits during the reporting period, indicating effective supply chain management[171]. Social Responsibility and Community Engagement - The company donated over RMB 450,000 to support disaster relief efforts following the Guangdong floods in 2024, demonstrating its commitment to social responsibility[189]. - The company is committed to community investment and has contributed to disaster relief projects, reinforcing its social responsibility values[187]. - The company has established a whistleblowing policy to prevent corruption, encouraging employees to report suspicious activities through various channels[186]. - During the reporting period, the company arranged for 60 employees, including directors, to receive two hours of anti-corruption training[186]. Compliance and Legal Matters - The company has not been involved in any disputes regarding product quality with customers during the reporting period[182]. - The company emphasizes the importance of intellectual property and has implemented multiple management systems to protect it[183]. - The company has a three-year product shelf life, and any product recalls or replacements require prior approval from the responsible regional sales team[182]. - The company has not been aware of any serious violations related to health and safety, advertising, labeling, or privacy laws during the reporting period[184]. - The company respects the privacy of partners, employees, and consumers, ensuring that sensitive information is handled by authorized personnel only[184]. Environmental Impact and Waste Management - Total greenhouse gas emissions for 2024 were 2,629.76 tons CO2 equivalent, an increase of 3.95% from 2,529.08 tons in 2023[192]. - The total amount of hazardous waste increased significantly to 93.34 tons in 2024, up from 33.54 tons in 2023, representing a 178.5% increase[192]. - Total energy consumption reached 5,465,134.32 kWh in 2024, a rise of 8.17% compared to 5,051,869.44 kWh in 2023[192]. - The total number of employees decreased slightly to 468 in 2024 from 472 in 2023, with a notable increase in female employees from 236 to 241[194]. - Employee turnover rate for males increased to 25.6% in 2024 from 19.9% in 2023, while the turnover rate for females decreased to 18.7% from 21.2%[194]. - The total amount of non-hazardous waste increased to 310.82 tons in 2024 from 298.43 tons in 2023, showing a 4.7% rise[192]. - The company has set targets for emissions reduction and outlined steps taken to achieve these goals[200]. - Total harmful waste generated amounted to X tons, with a density of Y[200]. - Total non-harmful waste generated amounted to A tons, with a density of B[200]. - Direct (Scope 1) and energy indirect (Scope 2) greenhouse gas emissions were reported in tons, with a density of C[200]. - Total energy consumption was reported as D kilowatt-hours, with a corresponding density[200]. - Total water consumption was reported as E, with a density of F[200]. - The company has implemented policies to effectively use resources, including energy and water[200]. - Significant climate-related issues affecting the company have been identified, with management actions taken[200]. - The company has described methods for handling both harmful and non-harmful waste, along with reduction targets[200]. - The total amount of packaging materials used for products was reported as G tons, with a per unit production metric of H[200].
保宝龙科技(01861) - 2024 - 年度财报