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胜龙国际(01182) - 2025 - 年度财报
SUCCESS DRAGONSUCCESS DRAGON(HK:01182)2025-07-24 08:33

Statement from the Board of Directors Statement from the Board of Directors The Board Chairman reviewed and provided an outlook on the company's performance for the fiscal year ended March 31, 2025, anticipating geopolitical risks and tariff wars to support gold prices, with central bank demand as a key driver, while the company focuses on its core gold processing business and explores other investment opportunities to maximize shareholder value - Looking ahead, geopolitical risks, tariff wars, and persistent inflation are expected to continue driving demand for gold as a safe-haven asset, with prices anticipated to reach new highs, primarily propelled by central bank demand1013 - The Group's core strategy is to consolidate and develop its gold processing business, leveraging existing experience and expertise to capture market opportunities while actively exploring other investment avenues to diversify revenue streams and maximize shareholder value1113 Management Discussion and Analysis FINANCIAL REVIEW In FY2025, the Group's total revenue significantly decreased by 70.4% to HKD 125 million, primarily due to reduced gold ore processing in Henan caused by supplier mine infrastructure construction, yet gross margin improved from 8.8% to 24.5% due to high-grade gold-bearing carbon supply, higher-margin business mix, and rising gold prices, leading to a net profit increase to HKD 8.5 million Key Financial Indicators for FY2025 | Indicator | FY2025 (Million HKD) | FY2024 (Million HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 125.2 | 422.7 | -70.4% | | Cost of Sales | 94.5 | 385.5 | -75.5% | | Gross Profit | 30.7 | 37.2 | -17.5% | | Gross Margin | 24.5% | 8.8% | +15.7pp | | Profit for the Year | 8.5 | 6.2 | +37.1% | - Revenue from gold-bearing carbon processing decreased from HKD 153.8 million to HKD 108.2 million, primarily because the company chose to stockpile gold bars for future sale at higher prices17 - Revenue from gold ore processing plummeted from HKD 268.9 million to HKD 17 million, due to insufficient gold ore supply and reduced output caused by infrastructure construction at two supplier mine sites in Henan18 LIQUIDITY, FINANCIAL RESOURCES AND FOREIGN CURRENCY EXPOSURE As of March 31, 2025, the Group maintained healthy liquidity with a current ratio of 1.9 times, while inventory significantly increased to HKD 92 million due to gold ingot stockpiling in Yunnan and business recovery in Henan, with zero gearing ratio indicating no borrowings, and directors believe sufficient working capital is available for the next 12 months' financial obligations Liquidity Indicators (As of March 31) | Indicator | 2025 (Million HKD) | 2024 (Million HKD) | | :--- | :--- | :--- | | Current Assets | 189.4 | 193.6 | | - Cash and Cash Equivalents | 73.0 | 79.8 | | - Inventories | 92.0 | 12.8 | | Current Liabilities | 99.8 | 85.9 | | Current Ratio | 1.9 times | 2.3 times | | Net Current Assets | 89.5 | 107.7 | - The Group's gearing ratio (total borrowings/total equity) is zero, indicating the company has no bank loans or other forms of debt financing3943 USE OF PROCEEDS FROM THE RIGHTS ISSUE The company reallocated the remaining HKD 64.1 million from rights issue proceeds to invest in and upgrade leased plants, acquire machinery and equipment, and supplement working capital for gold processing and trading business, with HKD 40.734 million utilized and HKD 23.366 million remaining as of March 31, 2025, expected to be fully used by March 31, 2026 Use of Proceeds from Rights Issue (As of March 31, 2025) | Item | Revised Allocation (Thousand HKD) | Actual Use (Thousand HKD) | Remaining Proceeds (Thousand HKD) | Expected Utilization Timeline | | :--- | :--- | :--- | :--- | :--- | | Investment and Upgrade of Leased Plants | 14,100 | 2,168 | 11,932 | March 31, 2026 | | Acquisition of Machinery and Equipment | 35,000 | 23,566 | 11,434 | March 31, 2026 | | Working Capital | 15,000 | 15,000 | – | - | | Total | 64,100 | 40,734 | 23,366 | | MATERIAL ACQUISITIONS, DISPOSALS AND SIGNIFICANT INVESTMENT On February 18, 2025, the company's indirect wholly-owned subsidiary, Shenglong Technology (Pu'er) Co., Ltd., acquired a batch of filter press, leaching, crushing, and grinding machinery and equipment for gold-bearing carbon processing for approximately HKD 23.573 million, with no other material acquisitions, disposals, or investments during the year - On February 18, 2025, the company's subsidiary agreed to acquire a batch of machinery and equipment for gold-bearing carbon processing for RMB 22,030,877.51 (approximately HKD 23,573,000)5056 FUTURE DEVELOPMENTS IN THE BUSINESS OF THE GROUP The Group remains optimistic about its core gold processing business, anticipating global economic uncertainties and central bank demand to continue driving gold prices higher, with Henan operations, previously suspended due to supplier mine infrastructure, having resumed in March 2025 and expected to significantly rebound next year's revenue, while plans for building a self-owned factory are paused in favor of upgrading existing leased plants and expanding capacity as a more cost-effective strategy - The Group anticipates continued strong gold demand, driven by global central banks stockpiling gold to hedge against USD risks and investors viewing gold as a safe-haven asset during economic instability, and will focus on developing its core gold processing business to capitalize on industry upside opportunities545560 - The suspension of gold ore processing operations in Henan, which significantly impacted this year's revenue, has been resolved with mine infrastructure construction completed and production resumed in March 2025, leading the Board to anticipate a significant revenue recovery next year6266 - The Group has suspended plans to build its own gold processing plant due to significant increases in land costs and the cost-effectiveness of leased facilities, reallocating related funds to invest in and upgrade existing leased plants and acquire equipment to support current business expansion636467 EMPLOYEES AND REMUNERATION POLICY As of March 31, 2025, the Group employed 84 staff, an increase of 4 from the previous year, with a remuneration policy based on market conditions and individual performance, offering benefits such as pension schemes, discretionary bonuses, share options, medical, and housing allowances, aiming to foster a fair, transparent, and high-performance corporate culture - As of March 31, 2025, the Group's total number of employees was approximately 84, an increase from 80 in 202470 PRINCIPAL RISKS AND UNCERTAINTIES The Group faces principal risks including strategic enterprise risks (e.g., economic instability leading to growth stagnation), operational risks (e.g., loss of key personnel), financial risks (e.g., liquidity, foreign exchange, and credit risks), and compliance risks, which management addresses through feasibility assessments, standardized operating procedures, cash flow monitoring, and collaboration with external professionals Strategic Enterprise Risks Strategic risks primarily stem from economic, governmental, and political instability, potentially leading to stagnation or decline in existing business growth and delays in implementing new business agreements, which management monitors through feasibility assessments and forecasts, taking timely measures - The Group faces risks of stagnation or negative growth in existing businesses and delays in implementing new business agreements due to economic, governmental, and political instability7983 Operational Risks Principal operational risks include high turnover of key personnel and crisis events that could disrupt business operations, which the Group manages through standardized operating procedures, authority, and reporting frameworks across various functional departments - Key operational risks include high employee turnover, particularly among core operational staff, and crisis events that could lead to business interruptions85 Financial Risks Financial risks encompass liquidity risk, foreign exchange risk, and credit risk, which the Group manages by monitoring cash flows and maintaining adequate cash levels for liquidity, closely monitoring foreign exchange exposure, and minimizing credit risk through dedicated teams setting credit limits and recovering overdue debts - The Group manages liquidity risk by monitoring cash flows and maintaining adequate cash levels, while closely monitoring foreign exchange risk and considering hedging when necessary879192 Compliance Risk Compliance risk refers to the risk of being reprimanded by authorities for non-compliance with regulations, which management addresses by collaborating with external professionals to ensure business processes and documentation fully comply with applicable local laws and regulations - To address compliance risk, management collaborates with external professionals to ensure business procedures and documentation fully comply with applicable local laws and regulations8993 Directors' and Senior Management's Profile EXECUTIVE DIRECTORS This section introduces the backgrounds of three executive directors: Chairman Mr. Liu Shiwei, experienced in banking and investment, whose daughter is a major shareholder; CEO Mr. Wang Baozhi, with over 25 years of financial experience; and COO Mr. Ding Lei, holding a Master's in Finance and extensive management experience in mining, who is related to Chairman Mr. Liu Shiwei and the major shareholder - Chairman Mr. Liu Shiwei, 54 years old, holds a Master of Science degree from the University of South Florida and previously held senior management positions in investment banking departments at Ping An Bank and Industrial and Commercial Bank of China; his daughter, Ms. Liu Shannon Shuting, is a substantial shareholder of the company, holding 71.74% of the shares9596 - CEO Mr. Wang Baozhi, 57 years old, holds a Master of Economics degree from Jiangxi University of Finance and Economics, possesses over 25 years of experience in the financial sector, and previously served as Managing Director at Zhongrong International Trust9899 - COO Mr. Ding Lei, 34 years old, holds a Master of Finance degree from the University of Texas at Dallas, has held senior management positions in several mining companies, and is the nephew of Chairman Mr. Liu Shiwei104106107 INDEPENDENT NON-EXECUTIVE DIRECTORS This section introduces the backgrounds of three independent non-executive directors: Mr. Tang Yougao, holding a Master of Economics degree with diverse management roles across industries; Ms. Wong Chi Yan, a Hong Kong Certified Public Accountant and Chartered Secretary with extensive experience in auditing, accounting, and M&A; and Professor Cheung Ka Yu, a Hong Kong practicing accountant with over 30 years of experience in corporate finance, compliance, and corporate governance - Mr. Tang Yougao, 58 years old, holds a Master of Economics degree and has served as chairman, director, and supervisor in companies across various industries111112 - Ms. Wong Chi Yan, 43 years old, is a member of the Hong Kong Institute of Certified Public Accountants and the Hong Kong Institute of Chartered Secretaries, possessing extensive experience in auditing, accounting, finance, and M&A, and has served as an independent non-executive director for several listed companies117118 - Professor Cheung Ka Yu, 53 years old, is a Hong Kong practicing accountant with a Doctor of Business Administration degree, possessing profound experience in regulation, corporate finance, compliance, and corporate governance, and has served as a director for several listed companies123125 Directors' Report PRINCIPAL ACTIVITIES The Group's principal activity is engaging in gold processing operations within the People's Republic of China (PRC) - The Group's principal business is gold processing in China130135 RESULTS, DIVIDEND AND DIVIDEND POLICY The Board does not recommend paying any dividend for the year ended March 31, 2025, as the company has no preset dividend payout ratio, and dividend decisions will comprehensively consider the Group's financial performance, retained earnings, capital requirements, and overall economic conditions - The Directors do not recommend the payment of any dividend for the year ended March 31, 2025 (2024: nil)131137 PURCHASE, REDEMPTION OR SALE OF LISTED SECURITIES During the year, the company repurchased 7,385,000 shares on the Stock Exchange for a total consideration of HKD 3,227,300 under shareholder authorization, holding these shares as treasury stock, which directors believe enhances net asset value per share and long-term shareholder value Details of Share Repurchases | Repurchase Month | Number of Shares Repurchased | Highest Price Per Share (HKD) | Lowest Price Per Share (HKD) | Total Consideration Paid (HKD) | | :--- | :--- | :--- | :--- | :--- | | December 2024 | 1,600,000 | 0.335 | 0.275 | 521,525 | | January 2025 | 1,495,000 | 0.435 | 0.340 | 593,525 | | February 2025 | 2,975,000 | 0.530 | 0.440 | 1,438,900 | | March 2025 | 1,315,000 | 0.550 | 0.475 | 673,350 | | Total | 7,385,000 | | | 3,227,300 | MAJOR CUSTOMERS AND SUPPLIERS The Group exhibits very high customer and supplier concentration, with the top five customers accounting for 91.3% of total turnover and the largest customer for 43.4%, while the top five suppliers accounted for 93.9% of total purchases and the largest supplier for 46.6% during the year - The top five customers accounted for approximately 91.3% of total turnover, with the largest customer contributing approximately 43.4%159164 - The top five suppliers accounted for approximately 93.9% of total purchases, with the largest supplier contributing approximately 46.6%160164 SUBSTANTIAL SHAREHOLDERS As of March 31, 2025, Ms. Liu Shannon Shuting, through her wholly-owned company Stone Steps Investments Limited, held 250,729,906 shares, representing 71.74% of the issued share capital, making her the company's substantial controlling shareholder Substantial Shareholders' Shareholding (As of March 31, 2025) | Shareholder Name | Capacity | Number of Shares Held (Long Position) | Shareholding Percentage | | :--- | :--- | :--- | :--- | | Ms. Liu Shannon Shuting | Interest in controlled corporation | 250,729,906 | 71.74% | | Stone Steps Investments Limited | Beneficial owner | 250,729,906 | 71.74% | Corporate Governance Report BOARD OF DIRECTORS The Board of Directors comprises six directors, including three executive and three independent non-executive directors, meeting the Listing Rules' requirement for at least one-third independent non-executive directors, responsible for major company decisions, financial statement approval, and internal controls, while delegating daily operations to management, with all directors attending all three Board meetings and the Annual General Meeting during the reporting period - The Board of Directors comprises 3 executive directors and 3 independent non-executive directors, meeting the Listing Rules' requirements for board independence236238 Board Meeting Attendance (FY2025) | Director | Capacity | Attendance at Regular Board Meetings | Attendance at Annual General Meeting | | :--- | :--- | :--- | :--- | | Liu Shiwei | Executive Director and Chairman | 3/3 | 1/1 | | Wang Baozhi | Executive Director and CEO | 3/3 | 1/1 | | Ding Lei | Executive Director and COO | 3/3 | 1/1 | | Tang Yougao | Independent Non-Executive Director | 3/3 | 1/1 | | Wong Chi Yan | Independent Non-Executive Director | 3/3 | 1/1 | | Cheung Ka Yu | Independent Non-Executive Director | 3/3 | 1/1 | BOARD COMMITTEES The company has established a Remuneration Committee, Nomination Committee, and Audit Committee to enhance corporate governance, with the Remuneration and Nomination Committees both comprising a majority of independent non-executive directors responsible for reviewing executive remuneration and director nominations respectively, while the Audit Committee, composed entirely of independent non-executive directors, oversees financial reporting and internal controls, with all committees holding meetings and fulfilling their duties during the year - The Remuneration Committee comprises two independent non-executive directors and one executive director, responsible for reviewing the remuneration policies and packages for directors and senior management282 - The Nomination Committee consists of one executive director (Chairman) and two independent non-executive directors, responsible for reviewing the Board's structure, size, and composition, and making recommendations on director appointments and succession planning291 - The Audit Committee is composed of three independent non-executive directors, responsible for reviewing financial statements, internal control systems, and communication with external auditors321 RISK MANAGEMENT AND INTERNAL CONTROL The Board of Directors bears ultimate responsibility for establishing and maintaining effective risk management and internal control systems, with the Group having engaged an independent consulting firm to perform internal audit functions and report regularly to the Audit Committee, and following an annual review, the Board deems the Group's risk management and internal control systems effective and adequate across financial, operational, and compliance aspects, with no significant control deficiencies identified during the reporting period - The Board of Directors is responsible for establishing, maintaining, and reviewing effective risk management and internal control systems330 - The Group has engaged an independent consulting firm to perform internal audit functions, reporting regularly to the Audit Committee, and annual review results indicate the Group's internal control system is effective with no material deficiencies identified332 SHAREHOLDERS' RIGHTS The company safeguards shareholder rights, including the right to convene a Special General Meeting (SGM) and propose resolutions at general meetings, with shareholders holding at least 10% of the paid-up share capital with voting rights able to request the Board in writing to convene an SGM, and shareholders may submit inquiries and suggestions to the Board through the company secretary - Shareholders holding not less than one-tenth of the company's paid-up share capital carrying voting rights have the right to request the Board to convene a Special General Meeting by written requisition342 Environment, Social and Governance Report SOCIAL SUSTAINABILITY Regarding social sustainability, the Group emphasizes product responsibility, implementing strict quality control from procurement to production with product recall procedures, respects intellectual property, and protects customer data privacy, collaborating with approximately 30 suppliers and integrating social and environmental standards into procurement contracts, prioritizing employee health and safety through strict policies and training, achieving zero work-related fatalities in the past three years, and is committed to equal employment opportunities with a total workforce of 84 employees and a near-balanced gender ratio - The Group implements stringent product quality control, covering the entire process from raw material procurement to production and processing, ensuring the purity and standards of final products, with no product recalls due to safety and health reasons during the reporting period409413 - The Group highly prioritizes employee health and safety, complying with relevant laws and regulations, and has established detailed risk management measures, particularly for chemical handling and high-temperature/high-pressure operations, with no safety incidents and zero work-related fatalities in the past three years during the reporting period430431440 Employee Profile (As of March 31, 2025) | Category | Breakdown | Number of Employees | Percentage | | :--- | :--- | :--- | :--- | | Total Employees | | 84 | 100% | | Gender | Male | 43 | 51% | | | Female | 41 | 49% | | Age | 20-35 years | 23 | 27% | | | 36-50 years | 42 | 50% | | | Over 50 years | 19 | 23% | | Location | Henan | 33 | 39% | | | Yunnan | 34 | 40% | | | Shenzhen | 9 | 11% | | | Hong Kong | 8 | 10% | ENVIRONMENTAL SUSTAINABILITY In terms of environmental sustainability, the Group is committed to reducing its operational environmental impact, primarily through the adoption of cyanide-free hydrometallurgical technology for gold recovery, which is more environmentally friendly than traditional methods, with the main environmental footprint stemming from electricity consumption for heating during production (Scope 2 emissions), and actively practices resource conservation and recycling through heat recovery and reuse, internal solution circulation, and returning activated carbon to suppliers for regeneration - The Group utilizes cyanide-free technology for gold recovery, avoiding the use of highly toxic chemicals, thereby making the production process more environmentally friendly than traditional methods496 Greenhouse Gas Emissions (During Reporting Period) | Scope | Emissions (kg CO2e) | Intensity (kg CO2e/Thousand HKD Revenue) | | :--- | :--- | :--- | | Scope 1 (Direct Emissions) | 15,259 | 0.12 | | Scope 2 (Indirect Emissions) | 851,206 | 6.80 | | Scope 3 (Other Indirect Emissions) | 2,557 | 0.02 | Resource Consumption (During Reporting Period) | Resource | Consumption | Intensity (Per Thousand HKD Revenue) | | :--- | :--- | :--- | | Electricity | 13,112,820 kWh | 104.7 kWh | | Water | 3,625 cubic meters | 0.03 cubic meters | Independent Auditor's Report Independent Auditor's Report Independent auditor Zhongzheng Tianheng Certified Public Accountants Limited issued an unmodified opinion on the Group's consolidated financial statements for the year ended March 31, 2025, affirming that the statements present a true and fair view of the Group's financial position and operating results, with inventory valuation highlighted as a key audit matter due to its significant amount (approximately HKD 91.952 million) and the complex, subjective judgments involved in management's provision estimates - The auditor concluded that the consolidated financial statements present a true and fair view of the Group's financial position and performance in accordance with Hong Kong Financial Reporting Standards, issuing an unmodified opinion538541 - A key audit matter is inventory valuation; as of March 31, 2025, the Group's inventory amounted to approximately HKD 91,952,000, and due to the significant scale of inventory and the substantial management judgment involved in its provision estimates, the auditor paid particular attention to this area540545546 Consolidated Financial Statements Consolidated Statement of Profit or Loss and Other Comprehensive Income For the fiscal year ended March 31, 2025, the Group's revenue was HKD 125 million, a significant decrease from HKD 423 million last year; however, due to a more substantial reduction in cost of sales, gross profit only slightly decreased from HKD 37.2 million to HKD 30.7 million, ultimately leading to an increase in profit for the year (net profit) from HKD 6.18 million to HKD 8.51 million Consolidated Statement of Profit or Loss Summary | Item (Thousand HKD) | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 125,245 | 422,733 | | Gross Profit | 30,725 | 37,237 | | Profit Before Tax | 13,119 | 12,512 | | Profit for the Year | 8,514 | 6,178 | | Basic Earnings Per Share (HK cents) | 2.44 | 1.77 | Consolidated Statement of Financial Position As of March 31, 2025, the Group's total assets were HKD 223 million, total liabilities HKD 101 million, and net assets HKD 122 million, with the most significant asset-side change being a substantial increase in inventories from HKD 12.81 million to HKD 91.95 million, while trade payables on the liability side rose from HKD 29.82 million to HKD 61.52 million Consolidated Statement of Financial Position Summary (As of March 31) | Item (Thousand HKD) | 2025 | 2024 | | :--- | :--- | :--- | | Non-Current Assets | 33,229 | 11,291 | | Current Assets | 189,391 | 193,558 | | Of which: Inventories | 91,952 | 12,813 | | Of which: Bank and Cash Balances | 72,972 | 79,751 | | Total Assets | 222,620 | 204,849 | | Current Liabilities | 99,846 | 85,858 | | Non-Current Liabilities | 700 | 1,034 | | Total Liabilities | 100,546 | 86,892 | | Net Assets | 122,074 | 117,957 | Consolidated Statement of Cash Flows This fiscal year, the Group generated a net cash inflow of HKD 24.36 million from operating activities, a significant improvement from last year's net outflow of HKD 6.76 million, primarily due to a substantial decrease in other receivables, while net cash outflow from investing activities was HKD 25.26 million, mainly for purchasing property, plant, and equipment, and net cash outflow from financing activities was HKD 5.16 million, primarily for share repurchases and lease liability repayments, with cash and cash equivalents decreasing to HKD 72.97 million at year-end Consolidated Statement of Cash Flows Summary | Item (Thousand HKD) | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Generated From/(Used In) Operating Activities | 24,364 | (6,760) | | Net Cash (Used In)/Generated From Investing Activities | (25,262) | 1,206 | | Net Cash Used In Financing Activities | (5,156) | (3,807) | | Net Decrease in Cash and Cash Equivalents | (6,054) | (9,361) | | Cash and Cash Equivalents at Year End | 72,972 | 79,751 | Five-Year Financial Summary Five-Year Financial Summary This section provides a summary of the Group's key financial data for the past five fiscal years (2021-2025), showing that while revenue peaked in 2024 and significantly declined in 2025, the profit for the year in 2025 was the highest in five years, with total assets and net assets demonstrating a steady growth trend over the period Five-Year Performance Summary (Thousand HKD) | Fiscal Year | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 125,245 | 422,733 | 363,764 | 182,032 | 175,196 | | Profit/(Loss) for the Year | 8,514 | 6,178 | 816 | 2,032 | (10,544) | Five-Year Assets and Liabilities Summary (Thousand HKD) | Fiscal Year | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 222,620 | 204,849 | 211,983 | 141,916 | 104,321 | | Total Liabilities | (100,546) | (86,892) | (96,113) | (92,036) | (56,975) | | Net Assets | 122,074 | 117,957 | 115,870 | 49,880 | 47,346 |