现恒建筑(01500) - 2025 - 年度财报

Corporate Information The company's corporate details cover its board, key personnel, auditor, Cayman Islands registration, and HKEX listing Board of Directors The company's Board of Directors comprises executive directors Liu Bowen, Zheng Rongchang, Guan Jiexin, and independent non-executive directors Liang Zijian, Lin Zhixiong, Mo Jinchang, with established Audit, Remuneration, Nomination, and Sustainability Committees - Executive directors include Liu Bowen, Zheng Rongchang, and Guan Jiexin[6] - Independent non-executive directors include Liang Zijian, Lin Zhixiong, and Mo Jinchang[6] - The company has established an Audit Committee, Remuneration Committee, Nomination Committee, and Sustainability Committee[6] Other Corporate Details The company's authorized representatives are Guan Jiexin and Wang Qianyi, with Wang Qianyi also serving as company secretary, and KPMG as auditor; it is registered in the Cayman Islands with its principal place of business in Causeway Bay, Hong Kong, and stock code 1500 - Authorized representatives are Guan Jiexin and Wang Qianyi, with Wang Qianyi also serving as company secretary[7] - The auditor is KPMG[7] - The company's registered office is in the Cayman Islands, and its principal place of business in Hong Kong is located at 26/F, Parkview Centre, 5 Moreton Terrace, Causeway Bay[9][10] - The company's stock code on the Hong Kong Stock Exchange is 1500[10] Chairman's Statement The Chairman's Statement highlights that the company's FY2024/25 financial results were negatively impacted by provisions for liquidated and ascertained damages due to project delays, with no new contracts awarded this fiscal year compared to three new contracts totaling HK$700.5 million in the previous year, while the company continues to focus on "design and build" projects for profitability and has established a Sustainability Committee to monitor ESG and climate-related matters - The FY2024/25 financial results were negatively impacted by provisions for liquidated and ascertained damages due to project delays[15][18] - No new contracts were awarded in the current financial year, whereas three new contracts totaling HK$700.5 million were awarded in the previous financial year[16][18] - The company continues to use "B100 biodiesel" generators and has established a Sustainability Committee to monitor ESG and climate-related matters[14][17] - Looking ahead, the company will continue to focus on a "design and build" project strategy to maintain profitability and safeguard shareholders' interests[20][22] Highlights The company's FY2024/25 revenue was HK$273.6 million, a decrease of HK$109.5 million from the previous fiscal year, with gross profit falling to HK$0.2 million, gross profit margin decreasing from 1.8% to 0.1%, and net loss expanding to HK$18.9 million, resulting in a loss per share of -2.3 HK cents 2024/25 Financial Year Key Financial Highlights | Metric | FY2024/25 (HK$ million) | FY2023/24 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Revenue | 273.6 | 383.1 | -109.5 | | Gross Profit | 0.2 | 7.0 | -6.8 | | Net Loss | -18.9 | -12.9 | -6.0 | | Loss per Share (HK cents) | -2.3 | -1.5 | -0.8 | | Gross Profit Margin | 0.1% | 1.8% | -1.7% | Management Discussion and Analysis BUSINESS AND FINANCIAL REVIEW The Group primarily operates as a contractor in Hong Kong's foundation industry, undertaking foundation and related works; in FY2024/25, no new projects were awarded, but six projects are under construction with an outstanding contract sum of HK$416.4 million, while financial performance was impacted by project delays and changes in variable estimates, leading to decreased revenue and gross profit, and an expanded net loss, with the company facing risks from high regulation, construction uncertainties, failure to secure new contracts, and external economic factors Business Review The Group primarily undertakes foundation and related works for private construction projects in Hong Kong, focusing on "design and build" projects as a main contractor, with no new projects awarded in FY2024/25, and six projects under construction as of March 31, 2025, with an outstanding contract sum of HK$416.4 million - The Group primarily operates as a contractor in the foundation industry in Hong Kong, undertaking foundation and related works[33][37] - The company focuses on "design and build" projects, acting as a main contractor, and has successfully implemented alternative designs to enhance cost-effectiveness in construction projects[34][35][38] - In FY2024/25, no new projects were awarded, and as of March 31, 2025, six projects are under construction with an outstanding contract sum of HK$416.4 million[36][38] Financial Review In FY2024/25, the company's revenue was HK$273.6 million, gross profit was HK$0.2 million, and gross profit margin decreased to 0.1%, with net loss expanding to HK$18.9 million, primarily due to provisions for liquidated and ascertained damages from project delays and changes in variable estimates for previously completed projects 2024/25 Financial Year Financial Performance Comparison | Metric | FY2024/25 (HK$ million) | FY2023/24 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Revenue | 273.6 | 383.1 | -109.5 | | Gross Profit | 0.2 | 7.0 | -6.8 | | Gross Profit Margin | 0.1% | 1.8% | -1.7% | | Net Loss | 18.9 | 12.9 | +6.0 | - The decrease in revenue and gross profit is primarily attributable to provisions for liquidated and ascertained damages due to unexpected delays in certain foundation engineering projects, as well as changes in variable estimates for projects completed in prior years[44][46] - Administrative and other operating expenses slightly increased by HK$0.1 million to HK$20.7 million[45][47] Principal Risks and Uncertainties The company faces multiple principal risks, including high regulation in the foundation industry, uncertainties in construction progress (such as foundation damage and delay claims), business impairment from failing to secure new contracts, and the impact of uncertain external factors like government policy changes, economic downturns, social unrest, and natural disasters on the construction industry - The foundation industry is highly regulated, requiring the company to comply with financial and management standards set by relevant government departments, and failure to maintain registration could significantly and adversely impact business[49][50][53][54] - Uncertainties in the construction process may lead to additional costs, project delays, client claims, and third-party disputes, affecting the company's reputation and financial performance[51][52][55] - Business relies on successfully securing new contracts, and failure to obtain new tenders or contracts of similar aggregate value could adversely affect financial performance[57][58][61] - External factors such as changes in government policies, economic downturns, social unrest, and natural disasters may adversely affect the construction industry, particularly impacting the number of new private market construction projects[59][60][62][63] Relationships with Customers, Working Partners and Employees The company maintains long-term close relationships with customers and working partners, including subcontractors, suppliers, and consultants, with some collaborations exceeding 10 years; it boasts a stable and experienced management team, with no employee turnover in the project management team in 2025 (compared to 10% in 2024), and many skilled employees having served for years, ensuring high-quality services and customer satisfaction - The company maintains long-term relationships with customers and working partners, including subcontractors, suppliers, and consultants, with some collaborations exceeding 10 years[64][66] - The company has a stable and experienced management team, with no employee turnover in the project management team in 2025 (compared to a 10% turnover rate in 2024)[65][66] - An experienced management team and stable skilled labor force are key drivers for delivering quality engineering and achieving high customer satisfaction[65][66] Environmental Policies The company prioritizes environmental protection in its projects, holding ISO 14001:2015 (Environmental Management System Certification) valid until September 3, 2026, and considers client environmental requirements and relevant laws in tender documents, with a Safety and Environmental Officer ensuring compliance and reporting environmental issues - The company holds ISO 14001:2015 (Environmental Management System Certification), valid until September 3, 2026[68][70] - When preparing tender documents, the company considers potential clients' environmental requirements and relevant laws and regulations[68][70] - The Safety and Environmental Officer is responsible for ensuring the company's compliance with applicable laws and regulations, and for identifying and reporting environmental issues[68][70] Compliance with Relevant Laws and Regulation The company primarily undertakes foundation works for construction projects in the private market in Hong Kong and complies with regulations from the Buildings Department; the directors confirm that as of the report date, the company has obtained all necessary registrations and certificates for its business and operations and has complied in all material respects with applicable laws and regulations in Hong Kong - The company primarily undertakes foundation works for construction projects in the private market in Hong Kong and must comply with the rules and regulations of the Buildings Department governing private contractors[69][71] - The directors confirm that for the financial year ended March 31, 2025, and up to the date of this report, the company has obtained all necessary registrations and certificates for its business and operations and has complied in all material respects with applicable laws and regulations in Hong Kong[69][71] LIQUIDITY, FINANCIAL RESOURCES AND CAPITAL STRUCTURE As of March 31, 2025, the company's current ratio was 2.9 and gearing ratio was 5.0%, a slight increase from the previous year primarily due to a decrease in equity from losses; cash and bank balances totaled HK$73.0 million, of which HK$41.6 million were restricted bank balances, with a sound capital structure comprising HK$242.7 million in equity and HK$13.0 million in debt, and HK$150.1 million in undrawn and unrestricted bank facilities Liquidity and Capital Structure Metrics | Metric | As of March 31, 2025 | As of March 31, 2024 | | :--- | :--- | :--- | | Current Ratio | 2.9 | 3.0 | | Gearing Ratio | 5.0% | 5.4% | - The gearing ratio increased by 0.4 percentage points, primarily due to a decrease in total equity resulting from the loss incurred for the year ended March 31, 2025[74] - As of March 31, 2025, the company's cash and bank balances totaled HK$73.0 million (2024: HK$78.6 million), of which HK$41.6 million (2024: HK$43.9 million) were restricted bank balances[74] - The company's capital structure includes HK$242.7 million in equity and HK$13.0 million in debt[74] - The company has HK$190.0 million in bank facilities, of which approximately HK$150.1 million are undrawn and unrestricted[74] EMPLOYEES As of March 31, 2025, the company had 47 full-time employees (2024: 48), offering competitive remuneration packages including salaries, performance bonuses, training, and MPF contributions, determined based on market levels, employee, and company performance - As of March 31, 2025, the company had 47 full-time employees (2024: 48 employees)[75][80] - The company offers competitive remuneration packages, including salaries, performance bonuses, training, and Mandatory Provident Fund contributions[75][80] CAPITAL COMMITMENTS As of March 31, 2025, the company had no capital commitments (2024: nil) - As of March 31, 2025, the company had no capital commitments (2024: nil)[76][81] CONTINGENT LIABILITIES Except as disclosed in Note 21 to the financial statements, the company had no other contingent liabilities as of March 31, 2025 - Except as disclosed in Note 21 to the financial statements, the company had no other contingent liabilities as of March 31, 2025[77][82] CHARGE OVER ASSETS Except as disclosed in Notes 13 and 14(a) to the financial statements, the company had no other significant charges over assets as of March 31, 2025 (2024: nil) - Except as disclosed in Notes 13 and 14(a) to the financial statements, the company had no other significant charges over assets as of March 31, 2025 (2024: nil)[78][83] SIGNIFICANT INVESTMENTS HELD, MATERIAL ACQUISITIONS OR DISPOSALS OF SUBSIDIARIES AND AFFILIATED COMPANIES, AND PLANS FOR MATERIAL INVESTMENTS OR CAPITAL ASSETS During FY2024/25, the company held no significant investments, nor did it undertake any material acquisitions or disposals of subsidiaries and affiliated companies, and as of March 31, 2025, there were no other plans for material investments or capital assets - During FY2024/25, the company held no significant investments, nor did it undertake any material acquisitions or disposals of subsidiaries and affiliated companies[79][84] - As of March 31, 2025, there were no other plans for material investments or capital assets[79][84] FUTURE PROSPECTS The company anticipates a mid-term recovery in the foundation industry driven by the Hong Kong government's commitment to increasing land supply and infrastructure investment; despite intense competition, the Board is confident in the company's ability to achieve growth in net profit and operational scale, leveraging its long-standing reputation, listing platform, and sound financial position, while continuing to expand capacity, enhance foundation design and project management skills, and provide high-quality, flexible solutions to maintain its competitive edge - The company anticipates a mid-term recovery in the foundation industry, driven by the Hong Kong government's commitment to increasing land supply and infrastructure investment[86][87] - The Board is confident in the company's ability to achieve growth in net profit and operational scale, leveraging its long-standing reputation, listing platform, and sound financial position[86][87] - The company will continue to expand capacity, enhance foundation design and project management skills, and provide high-quality, flexible solutions to maintain its competitive edge[86][87] Biographies of Directors and Senior Management This section details the biographies of the company's executive directors, independent non-executive directors, and senior management, including executive directors Liu Bowen (Chairman and CEO), Zheng Rongchang (Construction Director), and Guan Jiexin (Operations Director), all of whom are founders or seasoned managers with extensive industry experience, independent non-executive directors Liang Zijian, Lin Zhixiong, and Mo Jinchang, who possess deep professional backgrounds in accounting, engineering, and law, and senior management including Chief Financial Officer and Company Secretary Wang Qianyi - Mr Liu Bowen (70) is the Chairman, Chief Executive Officer, Executive Director, and General Manager, responsible for overall strategic development, project management, and client management, with nearly 33 years of experience in the construction industry[88][90] - Mr Zheng Rongchang (70) is an Executive Director and Construction Director, responsible for overseeing tender procedures, foundation design, project budgeting, and quality control, with over 20 years of experience in the construction industry[89][91] - Ms Guan Jiexin (53) is an Executive Director and Operations Director, responsible for project management, coordination, and daily operations, with over 20 years of experience in the construction industry[94][96] - Mr Liang Zijian (71), an Independent Non-Executive Director, is a practicing accountant with over 40 years of experience in auditing, accounting, taxation, and financial management[95][97] - Mr Lin Zhixiong (77), an Independent Non-Executive Director, has over 45 years of experience in the engineering industry and is the managing director and founder of several construction technology companies[98][100] - Ms Mo Jinchang (65), an Independent Non-Executive Director, is a partner at a law firm with over 28 years of legal experience, specializing in corporate finance, IPOs, and M&A[102][104] - Ms Wang Qianyi (59) is the Chief Financial Officer and Company Secretary, responsible for accounting, financial functions, internal controls, and company secretarial matters, with over 20 years of experience in auditing, accounting, and financial management[103][105] Directors' Report PRINCIPAL ACTIVITIES The company is an investment holding company, and its subsidiaries are primarily engaged in foundation and related works, including demolition, site formation, ground investigation, and general building works - The company is an investment holding company, and its subsidiaries are primarily engaged in foundation and related works[108][113] - Related works include demolition, site formation, ground investigation, and general building works[108][113] RESULTS The Group's results for the financial year ended March 31, 2025, are presented in the consolidated statement of profit or loss and other comprehensive income - The Group's results for the financial year ended March 31, 2025, are presented in the consolidated statement of profit or loss and other comprehensive income on page 60 of this report[109][114] DIVIDENDS The Board of Directors resolved not to declare a final dividend for the FY2024/25 - The Board of Directors resolved not to declare a final dividend for the FY2024/25[110][115] CLOSURE OF REGISTER OF MEMBERS AND RECORD DATE To determine eligibility for attending the 2024/2025 Annual General Meeting, the company's register of members will be closed from September 9 to September 12, 2025 (both dates inclusive), requiring shareholders to submit share transfer forms by 4:30 p.m. on September 8, 2025, with the record date for the AGM set as September 12, 2025 - To ensure eligibility for attending and voting at the 2024/2025 Annual General Meeting, the company's register of members will be closed from Tuesday, September 9, 2025, to Friday, September 12, 2025 (both dates inclusive)[111][116] - Shareholders are requested to ensure that all duly completed share transfer forms, accompanied by the relevant share certificates, are lodged with the Hong Kong share registrar by 4:30 p.m. on Monday, September 8, 2025, at the latest[111][116] - The record date for determining eligibility to attend and vote at the Annual General Meeting is Friday, September 12, 2025[111][116] PURCHASE, SALE OR REDEMPTION OF THE COMPANY'S LISTED SECURITIES During the year, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities - During the year, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities[118][126] EVENTS AFTER THE REPORTING PERIOD The Board is not aware of any significant events occurring after March 31, 2025, up to the date of this report that require disclosure - The Board is not aware of any significant events occurring after March 31, 2025, up to the date of this report that require disclosure[119][127] FINANCIAL SUMMARY A summary of the Group's results and assets and liabilities for the past five financial years is presented on page 132, which does not form part of the audited consolidated financial statements of this report - A summary of the Group's results and assets and liabilities for the past five financial years is presented on page 132[120][128] - This summary does not form part of the audited consolidated financial statements of this report[120][128] SHARE CAPITAL Details of changes in share capital for FY2024/25 are provided in Note 19(c) to the financial statements - Details of changes in share capital for FY2024/25 are provided in Note 19(c) to the financial statements[121][129] MANAGEMENT CONTRACTS During FY2024/25, no contracts concerning the management and administration of the whole or any substantial part of the company's business were entered into or subsisted - During FY2024/25, no contracts concerning the management and administration of the whole or any substantial part of the company's business were entered into or subsisted[122][130] DISTRIBUTABLE RESERVES As of March 31, 2025, the company's total distributable reserves to equity shareholders amounted to approximately HK$133,668,000 - As of March 31, 2025, the company's total distributable reserves to equity shareholders amounted to approximately HK$133,668,000[123][131] PLANT AND EQUIPMENT Details of changes in the Group's plant and equipment for the year ended March 31, 2025, are provided in Note 11 to the financial statements - Details of changes in the Group's plant and equipment for the year ended March 31, 2025, are provided in Note 11 to the financial statements[124][132] PRE-EMPTIVE RIGHTS There are no provisions for pre-emptive rights in the company's articles of association or under Cayman Islands law - There are no provisions for pre-emptive rights in the company's articles of association or under Cayman Islands law[125][133] DIRECTORS For the year ended March 31, 2025, and up to the date of this report, the company's Board of Directors included executive directors Liu Bowen, Zheng Rongchang, and Guan Jiexin, as well as independent non-executive directors Liang Zijian, Lin Zhixiong, and Mo Jinchang; Mr Zheng Rongchang and Ms Guan Jiexin will retire by rotation at the 2024/2025 Annual General Meeting and are eligible for re-election, and the company has received independence confirmations from all independent non-executive directors and considers them all to be independent - For the year ended March 31, 2025, and up to the date of this report, the executive directors were Liu Bowen, Zheng Rongchang, and Guan Jiexin[134][137] - The independent non-executive directors were Liang Zijian, Lin Zhixiong, and Mo Jinchang (appointed on April 16, 2024), with Mr Qiu Zimin resigning on the same date[134][137][138] - Mr Zheng Rongchang and Ms Guan Jiexin will retire by rotation at the 2024/2025 Annual General Meeting and are eligible for re-election[134][137] - The company has received annual confirmations of independence from each independent non-executive director in accordance with Listing Rule 3.13 and considers all independent non-executive directors to be independent[135][137] - Mr Liu Bowen, Mr Zheng Rongchang, and Ms Guan Jiexin are also directors of certain subsidiaries of the company[139][144] DIRECTORS' SERVICE CONTRACTS Each executive director has entered into a service agreement with the company, and each independent non-executive director has signed a letter of appointment, both for a term of three years and renewable; no director proposed for re-election at the upcoming Annual General Meeting has a service contract with the company that is not terminable within one year without compensation (other than statutory compensation) - Each executive director has entered into a service agreement with the company, and each independent non-executive director has signed a letter of appointment, both for a term of three years and renewable thereafter[140][145] - No director proposed for re-election at the upcoming Annual General Meeting has a service contract with the company that is not terminable within one year without compensation (other than statutory compensation)[141][145] PERMITTED INDEMNITY PROVISION The company's articles of association stipulate that every director is entitled to be indemnified by the company out of its assets and profits against liabilities incurred in the course of duty, provided it does not extend to matters of fraud or dishonesty, and the company has purchased liability insurance for its directors - The articles of association stipulate that every director is entitled to be indemnified by the company out of its assets and profits against liabilities that may arise in connection with the performance of their duties as directors or other related matters[142][146] - This indemnity does not extend to any matter related to fraud or dishonesty on the part of the director[142][146] - The company has purchased liability insurance for potential legal actions and associated costs that may be brought against its directors[142][146] DIRECTORS' MATERIAL INTERESTS IN TRANSACTIONS, ARRANGEMENTS AND CONTRACTS THAT ARE SIGNIFICANT IN RELATION TO THE GROUP'S BUSINESS As of the end of the financial year ended March 31, 2025, or at any time during the year, neither the company nor any of its subsidiaries or its parent company entered into any significant transactions, arrangements, or contracts involving the Group's business in which a director had a direct or indirect material interest - As of the end of the financial year ended March 31, 2025, or at any time during the year, neither the company nor any of its subsidiaries or its parent company entered into any significant transactions, arrangements, or contracts involving the Group's business in which a director had a direct or indirect material interest[143][147] DIRECTORS' INTERESTS IN COMPETING BUSINESS Except for Mr Zheng Rongchang's interest in Longo Piling Company, during FY2024/25, no director, controlling shareholder, or their respective associates held any interest in a business that competes or may compete with the Group's business; the controlling shareholders have complied with their undertakings under the non-competition deed, and the independent non-executive directors have not identified any breaches - Except for Mr Zheng Rongchang's interest in Longo Piling Company, during FY2024/25, no director, controlling shareholder, or their respective associates held any interest in a business that competes or may compete with the Group's business[148][153] - Controlling shareholders Mr Liu Bowen, Ms Guan Jiexin, In Play Limited, and Kinetic Kingdom Limited have complied with their undertakings under the non-competition deed[149][153] - The independent non-executive directors are authorized to review compliance with the non-competition deed annually and have not identified any breaches[150][153] BIOGRAPHICAL DETAILS OF DIRECTORS AND SENIOR MANAGEMENT Brief biographical details of the directors and senior management are provided in the "Biographies of Directors and Senior Management" section of this report - Brief biographical details of the directors and senior management are provided in the "Biographies of Directors and Senior Management" section of this report[151][154] DIRECTORS' REMUNERATION Details of directors' remuneration are provided in Note 8 to the financial statements - Details of directors' remuneration are provided in Note 8 to the financial statements[152][155] DIRECTORS' AND CHIEF EXECUTIVES' INTERESTS IN SECURITIES As of March 31, 2025, directors and chief executives held long positions in the company's shares; Mr Liu Bowen directly held 0.91% of shares and, through controlled companies and spouse's interests, held a total of 40.67%; Mr Zheng Rongchang directly held 0.71% of shares and, through controlled companies, held a total of 33.24%; Ms Guan Jiexin, through controlled companies and spouse's interests, held a total of 40.67%; and Ms Mo Jinchang, through spouse's interests, held 0.72% Directors' and Chief Executives' Long Positions in Shares (As of March 31, 2025) | Director Name | Capacity/Nature of Interest | Number of Shares | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr Liu Bowen | Beneficial Owner | 7,520,000 | 0.91% | | | Interest in controlled corporation (In Play Limited) | 270,000,000 | 32.53% | | | Spouse's Interest (Ms Guan Jiexin) | 60,000,000 | 7.23% | | | Total | 337,520,000 | 40.67% | | Mr Zheng Rongchang | Beneficial Owner | 5,900,000 | 0.71% | | | Interest in controlled corporation (Wealth Celebration Limited) | 270,000,000 | 32.53% | | | Total | 275,900,000 | 33.24% | | Ms Guan Jiexin | Interest in controlled corporation (Kinetic Kingdom Limited) | 60,000,000 | 7.23% | | | Spouse's Interest (Mr Liu Bowen) | 277,520,000 | 33.44% | | | Total | 337,520,000 | 40.67% | | Ms Mo Jinchang | Spouse's Interest (Mr Qiu Zimin) | 6,000,000 | 0.72% | | | Total | 6,000,000 | 0.72% | SUBSTANTIAL SHAREHOLDERS' INTERESTS IN SECURITIES As of March 31, 2025, in addition to the directors and chief executives, substantial shareholders In Play Limited, Wealth Celebration Limited, and Kinetic Kingdom Limited held long positions in the company's shares, representing 32.53%, 32.53%, and 7.23% of the issued share capital, respectively Substantial Shareholders' Long Positions in Shares (As of March 31, 2025) | Substantial Shareholder Name | Capacity | Number of Shares | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | In Play Limited | Beneficial Owner | 270,000,000 | 32.53% | | Wealth Celebration Limited | Beneficial Owner | 270,000,000 | 32.53% | | Kinetic Kingdom Limited | Beneficial Owner | 60,000,000 | 7.23% | MAJOR SUPPLIERS AND CUSTOMERS For the financial year ended March 31, 2025, the company's largest supplier accounted for 35.5% of purchases, and the top five suppliers collectively accounted for 66.2%; the largest customer accounted for 44.7% of sales, and the top five customers collectively accounted for 98.1%, with no directors, their associates, or shareholders holding more than 5% of the company's issued shares having interests in these major suppliers or customers Major Suppliers and Customers Proportion (As of March 31, 2025) | Type | Proportion | | :--- | :--- | | Largest Supplier | 35.5% | | Top Five Suppliers (total) | 66.2% | | Largest Customer | 44.7% | | Top Five Customers (total) | 98.1% | - No directors, their associates, or any shareholder (to the best knowledge of the directors, holding more than 5% of the company's issued shares) had any interest in the major suppliers or customers mentioned above[166] DIRECTORS' RIGHT TO ACQUIRE SHARES OR DEBENTURES Save as disclosed in the section "Directors' and Chief Executives' Interests in Securities" above, during the year, neither the company, its holding company, subsidiaries, nor fellow subsidiaries were a party to any arrangement that would enable the directors or chief executives or their associates to acquire benefits by means of acquiring shares or debentures of the company or any other body corporate - Save as disclosed in the section "Directors' and Chief Executives' Interests in Securities" above, during the year, neither the company, its holding company, subsidiaries, nor fellow subsidiaries were a party to any arrangement that would enable the directors or chief executives or their associates to acquire benefits by means of acquiring shares or debentures of the company or any other body corporate[169][174] CONNECTED TRANSACTIONS For the year ended March 31, 2025, the company had no connected transactions or continuing connected transactions subject to the reporting, announcement, or independent shareholders' approval requirements under Chapter 14A of the Listing Rules; details of significant related party transactions are provided in Note 23 to the financial statements, which are either exempt from Chapter 14A of the Listing Rules or do not fall within its definition of connected transactions - For the year ended March 31, 2025, the company had no connected transactions or continuing connected transactions subject to the reporting, announcement, or independent shareholders' approval requirements under Chapter 14A of the Listing Rules[170][175] - Details of significant related party transactions conducted in the ordinary course of the Group's business are provided in Note 23 to the financial statements[170][175] - These transactions are either exempt from the reporting, announcement, and independent shareholders' approval requirements under Chapter 14A of the Listing Rules, or do not fall within the definition of connected transactions or continuing connected transactions as defined by Chapter 14A of the Listing Rules[170][175] SUFFICIENCY OF PUBLIC FLOAT Based on publicly available information and to the best knowledge and belief of the directors, the company has maintained the public float as required by the Listing Rules throughout the entire year ended March 31, 2025, and up to the date of this report - Based on publicly available information and to the best knowledge and belief of the directors, the company has maintained the public float as required by the Listing Rules throughout the entire year ended March 31, 2025, and up to the date of this report[171][176] BUSINESS REVIEW The Group's business review for FY2024/2025 is contained in the Management Discussion and Analysis section on pages 7 to 16 of this report and forms part of the Directors' Report - The Group's business review for FY2024/2025 is contained in the Management Discussion and Analysis section on pages 7 to 16 of this report and forms part of the Directors' Report[172][177] RETIREMENT SCHEMES The company participates in the Mandatory Provident Fund Scheme as required by the Mandatory Provident Fund Schemes Ordinance (Cap. 485 of the Laws of Hong Kong), and other than this, the company did not participate in any other retirement schemes during FY2024/25 - The Group participates in the Mandatory Provident Fund Scheme ("MPF Scheme") as required by the Mandatory Provident Fund Schemes Ordinance (Cap. 485 of the Laws of Hong Kong)[173][178] - Other than as stated above, the Group did not participate in any other retirement schemes during FY2024/25[173][178] SPECIFIC PERFORMANCE OF CONTROLLING SHAREHOLDERS UNDER RULE 13.18 OF THE LISTING RULES As of March 31, 2025, the company, as guarantor, and its subsidiary, as borrower, entered into a general banking and term loan facility agreement of HK$80 million with a licensed bank in Hong Kong; under the agreement, controlling shareholders Liu Bowen, Zheng Rongchang, and Guan Jiexin must maintain a beneficial ownership of not less than 50% of the total issued share capital, and any one of them must remain as the company's chairman, with a breach of these undertakings constituting an event of default - As of March 31, 2025, the company, as guarantor, and its subsidiary, as borrower, entered into a general banking and term loan facility agreement of HK$80 million with a licensed bank in Hong Kong[179][182] - Under the facility agreement, Mr Liu Bowen, Mr Zheng Rongchang, and Ms Guan Jiexin must maintain a beneficial ownership of not less than 50% of the company's total issued share capital[180][182] - The facility agreement also requires that any one of Mr Liu Bowen, Mr Zheng Rongchang, and Ms Guan Jiexin shall remain as the company's chairman[180][182] - A breach of the aforementioned undertakings will constitute an event of default, allowing the lender to cancel or suspend the facility and demand repayment of outstanding amounts[181][183] AUDITOR A resolution will be proposed at the upcoming Annual General Meeting to re-appoint KPMG as the company's auditor - A resolution will be proposed at the upcoming Annual General Meeting to re-appoint KPMG as the company's auditor[182][184] Corporate Governance Report CORPORATE GOVERNANCE PRACTICES The company is committed to high standards of corporate governance and complies with the Corporate Governance Code in Appendix C1 of the Listing Rules, with the exception of a deviation from Code Provision C.2.1 where the roles of Chairman and Chief Executive Officer are combined; the Board believes that Mr Liu Bowen's dual role ensures consistency in strategy, and the diverse backgrounds of the independent non-executive directors and the Board's composition provide sufficient independence - The company is committed to achieving high standards of corporate governance and complies with the Corporate Governance Code in Appendix C1 of the Listing Rules[186][187][189] - The company deviates from Code Provision C.2.1, where the roles of Chairman and Chief Executive Officer are combined and held by Mr Liu Bowen[187][188][189] - The Board believes that Mr Liu Bowen's dual role as Chairman and Chief Executive Officer ensures consistent and continuous planning and execution of the company's strategy, and that the diverse backgrounds of the independent non-executive directors and the Board's composition provide sufficient independence[188][189] GROUP'S VALUE AND CULTURE The company's business strategy includes maintaining its position in the construction industry, expanding its customer base, and developing niche markets for complex sites; it promotes a "RISE" corporate culture emphasizing Responsibility, Integrity, Safety, and Excellence, aiming to provide safe foundations for buildings and create sustainable value by reducing greenhouse gas emissions, noise, and air pollution - The company's business strategy includes maintaining its position as a major participant in the construction industry, expanding its customer base, and continuing to develop niche markets for sites with considerable difficulty and complexity[190] - The company promotes a "RISE" corporate culture, aiming to provide colleagues with Responsible, Integrity, Safety, and Excellence qualities[191][194][197] - The company's goal is to provide safe foundations for buildings and create sustainable value by reducing greenhouse gas emissions, noise, and air pollution generated by project activities[192][195][198] (A) THE BOARD The Board of Directors consists of six directors, three of whom are independent non-executive directors, meeting Listing Rules requirements; the Board is responsible for overseeing all significant company matters and has purchased liability insurance for directors and senior management, with management authorized to execute strategies and daily operations; all directors comply with the Model Code for Securities Transactions and receive regular training, and the Board has established Audit, Remuneration, Nomination, and Sustainability Committees, and adopted a Board Diversity Policy and Dividend Policy to ensure independence and effective operation Board Composition The Board of Directors comprises six directors, including three executive directors and three independent non-executive directors; independent non-executive directors constitute half of the Board's membership, exceeding the one-third requirement of the Listing Rules, ensuring sufficient independence; there are no other material relationships among Board members except for Mr Liu Bowen and Ms Guan Jiexin being spouses - The Board of Directors comprises six directors, including three executive directors and three independent non-executive directors[201][205] - Independent non-executive directors constitute half of the Board's membership, a proportion higher than the minimum one-third required by Listing Rule 3.10A[204][206] - Except for Mr Liu Bowen and Ms Guan Jiexin being spouses, there are no other financial, business, family, or other material relationships among Board members[202][206] Directors' Responsibilities The Board is responsible for overseeing all major company matters, including policy formulation, strategy, internal control, and risk management systems, and monitoring the performance of senior executives; directors must make objective decisions in the company's best interest, and the company has purchased liability insurance for directors and senior management - The Board's responsibilities include overseeing all major company matters, such as formulating and approving all policy matters, overall strategy, internal control and risk management systems, and monitoring the performance of senior executives[208][212] - Directors must make objective decisions in the best interest of the company[208][212] - The company has purchased liability insurance for directors and senior management to provide coverage for any legal liabilities arising from their performance of duties[209][212] Delegation by the Board The Board delegates authority to management, comprising executive directors and other senior executives, to implement strategies and policies adopted by the Board and handle the Group's daily operations; management meets regularly to review business performance, coordinate resources, and make financial and operational decisions, with the Board also regularly reviewing delegation arrangements - The Board delegates authority to management, comprising executive directors and other senior executives, to implement strategies and policies adopted by the Board from time to time and handle the Group's daily operations[210][213] - Executive directors and senior executives meet regularly to review the Group's overall business performance, coordinate overall resources, and make financial and operational decisions[210][213] - The Board also regularly reviews delegation arrangements to ensure they consistently meet the Group's needs[210][213] Compliance with the Model Code for Securities Transactions by Directors The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules; upon specific enquiry, all directors confirmed their compliance with the required standards of the Model Code during FY2024/25 - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules as the standard for directors' dealings in the company's securities[211][214] - Upon specific enquiry to all directors, each director confirmed their compliance with the required standards of the Model Code during FY2024/25[211][214] Independent Non-Executive Directors Independent non-executive directors play a crucial role on the Board by exercising independent judgment, providing impartial advice on the company's strategy, performance, and control; they possess extensive academic, professional, and industry expertise, along with management experience; all independent non-executive directors are appointed for a three-year term and are eligible for re-election, and have confirmed their independence, with the company considering them all to be independent - Independent non-executive directors play a crucial role on the Board by exercising independent judgment, and their opinions are vital for Board decisions, providing impartial advice on the company's strategy, performance, and control[216][217][219] - All independent non-executive directors possess extensive academic, professional, and industry expertise, as well as management experience[217][219] - All independent non-executive directors are appointed for a term of three years and are eligible for renewal for subsequent three-year terms; they have confirmed their independence to the company in accordance with Listing Rule 3.13, and the company considers them all to be independent[218][219] Appointment, Re-election and Removal of Directors Executive and independent non-executive directors are appointed for three-year terms and must retire by rotation and be eligible for re-election at annual general meetings, at least once every three years; directors appointed to fill casual vacancies serve until the first annual general meeting, and shareholders may remove a director at any time by ordinary resolution; the company also considers the independence of independent non-executive directors who have served for more than nine years - Each executive director and independent non-executive director has entered into a service contract or signed a letter of appointment with the company for a specified term and will retire by rotation and be eligible for re-election at future annual general meetings of the company[221][224] - Each director must retire by rotation at least once every three years and is eligible and willing to stand for re-election[222][224] - Shareholders of the company may remove a director whose term has not expired at any general meeting by ordinary resolution at any time[223][224] - When re-electing an independent non-executive director who has served for more than nine years, the company also considers their independence[226][227] Board Meetings The Board holds regular meetings to discuss and formulate overall strategies, operations, and financial performance; four regular meetings were held during the year, with all directors attending; the Board encourages directors to participate in continuous professional development, and the company secretary provides updated regulatory information to ensure directors are fully aware of their responsibilities - The Board meets regularly to discuss and formulate the Group's overall strategy, as well as its operational and financial performance[228][233] - The Board held four regular meetings during the year, and all directors attended all meetings and the Annual General Meeting[229] - All directors receive training in the form of seminars and are provided with training materials to ensure they fully understand their duties and responsibilities as directors under applicable rules and regulations[231][233] - The company secretary provides directors with updated information on the latest developments and changes in the Listing Rules, as well as applicable laws and regulatory requirements concerning essential matters for fulfilling directors' duties[232][234] Corporate Governance Functions The Board is responsible for performing corporate governance duties, including developing and reviewing corporate governance policies, overseeing director and senior management training, reviewing legal and regulatory compliance policies, establishing and monitoring codes of conduct for employees and directors, and reviewing the company's compliance with the Code - The Board is responsible for developing and reviewing the company's corporate governance policies and practices[239] - The Board is responsible for reviewing and overseeing the training and continuous professional development of directors and senior management[239] - The Board is responsible for reviewing and overseeing the company's policies and practices for compliance with legal and regulatory requirements[239] - The Board is responsible for developing, reviewing, and overseeing codes of conduct and compliance manuals applicable to employees and directors[239] - The Board is responsible for reviewing the company's compliance with the Code[239] Board Committees The Board has established an Audit Committee, Remuneration Committee, Nomination Committee, and Sustainability Committee, delegating specific responsibilities to each; each committee performs its duties according to its terms of reference, is adequately resourced, and may seek independent professional advice - The Board has established an Audit Committee, Remuneration Committee, Nomination Committee, and Sustainability Committee[236][237] - All Board committees perform their specific duties in accordance with their respective terms of reference[237] - Board committees have adequate resources to perform their duties and, upon reasonable request, may seek independent professional advice at the company's expense where appropriate[237] Audit Committee The Audit Committee, established on March 26, 2015, comprises three independent non-executive directors, with Mr Liang Zijian as Chairman; its primary responsibilities include advising the Board on the appointment and removal of external auditors, and reviewing and monitoring the financial reporting process and the effectiveness of internal controls and risk management; three meetings were held during the year - The Audit Committee was established on March 26, 2015, comprising three independent non-executive directors, with Mr Liang Zijian as Chairman[241][242] - Its primary responsibilities are to advise the Board on the appointment and removal of external auditors, and to review and monitor the financial reporting process and the effectiveness of the Group's internal controls and risk management[240][241] - The Audit Committee held three meetings during the year, with all members attending[243][244] Remuneration Committee The Remuneration Committee, established on March 26, 2015, comprises Ms Mo Jinchang (Chairperson), Ms Guan Jiexin, and Mr Liang Zijian; its primary responsibilities include advising on the overall remuneration policy and structure for all directors and senior management, reviewing performance-based remuneration, and ensuring directors do not determine their own remuneration; one meeting was held during the year - The Remuneration Committee was established on March 26, 2015, comprising Ms Mo Jinchang (Chairperson), Ms Guan Jiexin, and Mr Liang Zijian[247][248][249] - Its primary responsibilities are to advise on the overall remuneration policy and structure for all directors and senior management of the Group, review performance-based remuneration, and ensure directors do not determine their own remuneration[247][248] - The Remuneration Committee held one meeting during the year, with all members attending[250][251] Senior Management Annual Remuneration Range (As of March 31, 2025) | Remuneration Range | Number of Senior Management | | :--- | :--- | | HK$1,000,000 or below | 1 | Nomination Committee The Nomination Committee, established on March 26, 2015, comprises Mr Lin Zhixiong (Chairman), Mr Zheng Rongchang, and Ms Mo Jinchang; its primary responsibilities include advising the Board on director appointments and managing Board succession matters; one meeting was held during the year - The Nomination Committee was established on March 26, 2015, comprising Mr Lin Zhixiong (Chairman), Mr Zheng Rongchang, and Ms Mo Jinchang[254][255][256] - Its primary responsibilities are to advise the Board on director appointments and manage Board succession matters[254][255] - The Nomination Committee held one meeting during the year, with all members attending[257][258] Sustainability Committee The Sustainability Committee, established on March 18, 2025, comprises Ms Guan Jiexin (Chairperson), Mr Liang Zijian, Mr Lin Zhixiong, and Ms Mo Jinchang; its primary responsibilities include continuous oversight of ESG and climate change matters, including implementation progress, risk assessment, performance indicators, and report preparation; the committee will meet with management twice annually - The Sustainability Committee was established on March 18, 2025, comprising Ms Guan Jiexin (Chairperson), Mr Liang Zijian, Mr Lin Zhixiong, and Ms Mo Jinchang[261][262][264] - Its primary responsibilities are to continuously oversee ESG and climate change matters, including monitoring implementation progress, assessing risks and opportunities, reviewing and approving performance indicators and targets, and overseeing ESG report preparation[261][263] - The Sustainability Committee will meet with management twice annually to discuss and evaluate ESG and climate change initiatives, risks, and opportunities[262][264] Board Diversity Policy The company has adopted a Board Diversity Policy aimed at enhancing Board effectiveness by considering factors such as talent, skills, regional and industry experience, background, and gender; the Board will consider implementing measurable objectives and review them annually, and during the review year, the Board deemed the policy effective - The company has adopted a Board Diversity Policy aimed at achieving and maintaining Board diversity to enhance Board effectiveness by considering factors such as talent, skills, regional and industry experience, background, gender, and other qualifications[265][266][268] - The Board will consider implementing measurable objectives to implement this policy and review these objectives annually[266][268] - During the review year, the Board reviewed the implementation and effectiveness of the Board Diversity Policy and deemed it effective[267][269] Dividend Policy When considering whether to declare dividends and determining their amount, the Board considers various factors, including the company's overall operational and financial condition, capital and debt levels, future cash needs, business strategy, creditor restrictions, and general market conditions; the dividend policy is regularly reviewed by the Board and is subject to restrictions under the Cayman Islands Companies Act and the company's articles of association - When considering whether to propose dividends and determining their amount, the Board considers factors such as the company's overall operational and financial condition, capital and debt levels, future cash needs, business strategy and development requirements, creditor restrictions, and general market conditions[270] - The company's ability to pay dividends is subject to any restrictions imposed by the Cayman Islands Companies Act and the company's articles of association[271][273] - The dividend policy is regularly reviewed by the Board[271][273] Board Review on Other Policies During the review year, in addition to the Board Diversity Policy, the Board also reviewed the Whistleblowing Policy, Anti-Corruption Policy and Code of Conduct, and Shareholder Communication Policy, and found these policies to be effectively implemented - During the review year, the Board reviewed the