安保工程控股(01627) - 2025 - 年度财报

Corporate Information This section provides an overview of the company's board composition, committees, key personnel, share information, and contact details. Board Composition and Changes During the reporting period, there were changes in the company's board members, with Mr. Li Hang Ying appointed as Executive Director and Chief Executive Officer, while Mr. Lau Chi Fai and Mr. Ngai Chun Hung resigned. - Mr. Li Hang Ying was appointed as Executive Director and Chief Executive Officer on April 1, 2024[6] - Mr. Lau Chi Fai resigned as Executive Director on April 1, 2025[6] - Mr. Ngai Chun Hung resigned as Non-executive Director on April 1, 2024[6] Board Committees The company has established Audit, Remuneration, and Nomination Committees, primarily composed of independent non-executive directors, to ensure independent and effective corporate governance. - The Audit, Remuneration, and Nomination Committees are each composed of multiple independent non-executive directors, with Mr. Mong Chan as Chairman of the Audit Committee, Dr. Li Man Piu as Chairman of the Remuneration Committee, and Mr. Yau Kwok Fai as Chairman of the Nomination Committee[5][6][7] Company Secretary and Auditor Ms. Lam Chun Chu was appointed as Company Secretary on July 1, 2024, replacing Mr. Chong Yuk Fai, and Ernst & Young is the company's independent auditor. - Ms. Lam Chun Chu was appointed as Company Secretary on July 1, 2024[7] - Ernst & Young is the company's independent auditor[8] Share Information and Contact The company's ordinary shares are listed on the Main Board of The Stock Exchange of Hong Kong with stock code 01627, and the board lot size is 4,000 shares, with registration and contact information provided. - The company's ordinary shares are listed on the Main Board of The Stock Exchange of Hong Kong, with stock code 01627[9] - The board lot size is 4,000 shares[10] Five-Year Financial Summary This section presents a five-year overview of the group's financial performance, including results, statements of financial position, and key financial indicators. Results Overview The Group's performance has shown continuous growth over the past five years, with significant increases in revenue and gross profit in FY2025, and a sustained upward trend in profit for the year. Five-Year Results Overview (HK$ thousand) | Indicator | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 7,968,813 | 5,511,537 | 5,079,222 | 5,577,514 | 3,705,241 | | Cost of sales | (7,386,316) | (5,187,993) | (4,764,334) | (5,324,291) | (3,558,208) | | Gross profit | 582,497 | 323,544 | 314,888 | 253,223 | 147,033 | | Profit for the year | 228,562 | 204,889 | 174,068 | 122,880 | 94,700 | - FY2025 revenue increased by 44.6% year-on-year, reaching HK$7,968,813 thousand[12] - FY2025 gross profit increased by 80.0% year-on-year, reaching HK$582,497 thousand[12] Statements of Financial Position Overview The Group's net assets and total equity have consistently grown over the past five years, while non-current liabilities significantly decreased in FY2025. Five-Year Statements of Financial Position Overview (HK$ thousand) | Indicator | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Non-current assets | 1,896,724 | 1,728,193 | 1,658,772 | 1,305,917 | 1,278,964 | | Current assets | 3,381,869 | 3,177,454 | 2,967,709 | 2,620,491 | 1,785,361 | | Non-current liabilities | 18,496 | 1,872 | 490,940 | 494,199 | 486,071 | | Current liabilities | 3,525,032 | 3,286,209 | 2,615,267 | 2,009,786 | 1,228,711 | | Net assets | 1,735,065 | 1,617,566 | 1,520,274 | 1,422,423 | 1,349,543 | | Total equity | 1,735,065 | 1,617,566 | 1,520,274 | 1,422,423 | 1,349,543 | - Non-current liabilities significantly decreased to HK$18,496 thousand in FY2025, compared to HK$1,872 thousand in FY2024 and HK$490,940 thousand in FY2023[15] Financial Performance Indicators The Group's basic earnings per share and dividend per share have shown continuous growth, while the current ratio has decreased, and net assets per share have steadily increased. Five-Year Financial Performance Indicators | Indicator | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Basic earnings per share (HK cents) | 11.43 | 10.24 | 8.70 | 6.14 | 4.74 | | Dividend per share (HK cents) | 6.0 | 5.0 | 5.0 | 3.5 | 2.5 | | Current ratio | 0.96 | 0.97 | 1.1 | 1.3 | 1.5 | | Net assets per share (HK$) | 0.87 | 0.81 | 0.76 | 0.71 | 0.68 | - FY2025 basic earnings per share increased to 11.43 HK cents, and dividend per share increased to 6.0 HK cents[17] - The current ratio decreased from 1.5 in FY2021 to 0.96 in FY2025[17] Chairman's Statement This section provides the Chairman's review of the Group's financial results, dividend policy, and future outlook, highlighting key achievements and strategic directions. Results The Group's FY2025 revenue increased by 44.6% to HK$7,968,813,000, and profit for the year grew by 11.6% to HK$228,562,000; adjusted profit, excluding a HK$199,043,000 impairment loss on leasehold land, increased by 108.7% year-on-year. FY2025 Results Overview (HK$) | Indicator | FY2025 | FY2024 | Year-on-year Growth | | :--- | :--- | :--- | :--- | | Revenue | 7,968,813,000 | 5,511,537,000 | 44.6% | | Profit for the year | 228,562,000 | 204,889,000 | 11.6% | | Impairment loss on leasehold land | 199,043,000 | – | – | | Profit excluding impairment loss | 427,605,000 | 204,889,000 | 108.7% | | Basic earnings per share | 11.43 HK cents | 10.24 HK cents | 11.6% | - As of March 31, 2025, net assets attributable to owners of the parent were HK$1,735,065,000 (approximately HK$0.87 per share), representing a 7.3% year-on-year increase[32][34] Dividend The Board recommends a final dividend of 6.0 HK cents per ordinary share for the year ended March 31, 2025, an increase from 5.0 HK cents last year. Final Dividend (HK cents) | Year | Dividend per Share | | :--- | :--- | | 2025 | 6.0 | | 2024 | 5.0 | - Based on 2,000,000,000 issued ordinary shares, the total final dividend amounts to HK$120,000,000[36][39] Outlook The Hong Kong SAR Government's proactive policies on public housing supply and the Northern Metropolis development present a very optimistic medium-to-long-term outlook for the construction industry, with the Group expecting more public works and housing project opportunities. - The HKSAR Government's public housing supply target for the next decade is 308,000 units, with a total supply of 190,000 units in the next five years, an increase of approximately 80% compared to the previous administration's first five-year period[37][40] - The Northern Metropolis development projects (including Kwu Tung North/Fanling North, Hung Shui Kiu/Ha Tsuen, Yuen Long South, San Tin Technopole, etc.) have entered the construction phase, which will drive growth in the construction industry[38][40] - The Group expects to benefit from government policies, securing more public works and housing project opportunities[43][46] Summary of Substantial Contracts on Hand This section provides an overview of the Group's substantial contracts on hand, categorized by those awarded to subsidiaries and joint operations, detailing their total and outstanding values. Contracts Awarded to Subsidiaries As of March 31, 2025, the Group's subsidiaries held substantial contracts totaling approximately HK$19.627 billion, with outstanding contract value of approximately HK$15.890 billion, primarily for public housing development and data center construction. - Substantial contracts awarded to subsidiaries totaled approximately HK$19,627 million, with an outstanding contract value of approximately HK$15,890 million[49] - Key projects include the Public Housing Development at Area 42, Tung Chung, Phase 1 and Phase 2 (HK$5,400 million) and the Public Housing Development at Area 15 East, Fanling North, Phase 2 (HK$2,546 million)[50] Contracts Awarded to Joint Operations As of March 31, 2025, the Group's joint operations held substantial contracts totaling approximately HK$16.656 billion, with outstanding contract value of approximately HK$12.001 billion, covering projects such as government joint-user office buildings, cultural centers, and transitional housing. - Substantial contracts awarded to joint operations totaled approximately HK$16,656 million, with an outstanding contract value of approximately HK$12,001 million[49] - Key projects include the Design and Construction of Government Joint-User Office Building at Area 67, Tseung Kwan O (HK$3,587 million, Group's interest 51%) and the Construction of New Territories East Cultural Centre at Area 11, Fanling (HK$3,727 million, Group's interest 30%)[52] Licences and Qualifications This section outlines the major licenses and qualifications held by the Group's member companies, demonstrating their compliance and capability within the Hong Kong construction industry. Major Licences and Qualifications As of March 31, 2025, the Group's member companies hold various major licenses and qualifications from authorities such as the Development Bureau, Housing Authority, and Buildings Department, covering building construction, plumbing, site formation, and piling works, ensuring their business qualifications in the Hong Kong construction industry. - Onpo Engineering Company Limited holds Building (Confirmed) and Plumbing Installation II (Provisional) licenses from the Development Bureau, Public Works Branch, and Building (New Works) NW2 (Confirmed) license from the Housing Authority[54] - Federal Piling & Civil Engineering Company Limited holds Road and Drainage Works Group A (Provisional), Site Formation Works Group C (Provisional), and Land Piling Works Group II licenses from the Development Bureau, Public Works Branch[56] Management Discussion and Analysis This section provides a detailed analysis of the Group's financial performance, business review, financial position, and human resources, offering insights into key operational and strategic aspects. Performance The Group's FY2025 revenue increased by 44.6% to HK$7,968,813,000, and profit for the year grew by 11.6% to HK$228,562,000; adjusted profit, excluding a HK$199,043,000 impairment loss on leasehold land, increased by 108.7% year-on-year. FY2025 Performance Overview (HK$) | Indicator | FY2025 | FY2024 | Year-on-year Growth | | :--- | :--- | :--- | :--- | | Revenue | 7,968,813,000 | 5,511,537,000 | 44.6% | | Profit for the year | 228,562,000 | 204,889,000 | 11.6% | | Profit excluding impairment loss | 427,605,000 | 204,889,000 | 108.7% | | Basic earnings per share | 11.43 HK cents | 10.24 HK cents | 11.6% | - As of March 31, 2025, net assets attributable to owners of the parent were HK$1,735,065,000 (approximately HK$0.87 per share), representing a 7.3% year-on-year increase[60][63] Dividend The Board recommends a final dividend of 6.0 HK cents per ordinary share for the year ended March 31, 2025, an increase from 5.0 HK cents last year, subject to shareholders' approval. Final Dividend (HK cents) | Year | Dividend per Share | | :--- | :--- | | 2025 | 6.0 | | 2024 | 5.0 | Business Review The Group benefited from the Hong Kong government's public housing and infrastructure projects, achieving significant revenue growth and improved gross profit margin, with detailed analysis of income and expense items, including impairment losses and finance cost changes. - The HKSAR Government's commitment to increasing public housing unit supply, constructing transitional housing, and initiating large-scale infrastructure projects like the "Northern Metropolis" will ensure stable tender opportunities for public works construction contracts in the coming years[66][70] - The Group's overall gross profit margin increased from 5.9% in FY2024 to 7.3% in FY2025, primarily due to better-than-expected economic benefits from certain completed projects, leading to a reversal of contract work provisions[68][71] - An impairment loss on leasehold land of HK$199,043,000 was recognized in FY2025, mainly due to a downturn in the Hong Kong property market[78][84] - Finance costs decreased by 16.4% to HK$29,049,000, primarily benefiting from the repayment of a term loan during the year[79][85] - Income tax expense increased by 95.4% to HK$89,375,000, mainly due to the recognition of non-deductible impairment losses of approximately HK$199,043,000[82][88] Market Review The Hong Kong SAR Government's investments in public housing and infrastructure projects provide continuous and stable development opportunities for the construction industry. - Government commitments to increase public housing supply, construct transitional housing, and initiate large-scale infrastructure projects like the "Northern Metropolis" will ensure stable tender opportunities for public works construction contracts in the coming years[66][70] The Group's Performance The Group's revenue increased by 44.6% year-on-year, and its gross profit margin improved to 7.3%, primarily due to projects progressing as planned and the reversal of contract work provisions. FY2025 Revenue and Gross Profit Margin | Indicator | FY2025 | FY2024 | Year-on-year Growth | | :--- | :--- | :--- | :--- | | Revenue | HK$7,968,813,000 | HK$5,511,537,000 | 44.6% | | Gross profit margin | 7.3% | 5.9% | 1.4 percentage points | Building Construction Works During the year, the Group secured several significant contracts, including public housing development projects in Fanling North, Tung Chung, and Sheung Shui, and completed projects such as Kai Tak and Queen Mary Hospital redevelopment. - New contracts secured include the Public Housing Development at Area 15 East, Fanling North, Phase 2, and the Public Housing Development at Area 42, Tung Chung, Phase 1 and Phase 2[74][75] - Completed contracts include the Public Housing Development at Site 2B2, Kai Tak, and the Phase 1 Redevelopment of Queen Mary Hospital at Pok Fu Lam Road[74][75] Other Income and Gains Other income and gains primarily consist of bank interest income, remaining largely stable compared to the previous year. Other Income and Gains (HK$ thousand) | Indicator | FY2025 | FY2024 | | :--- | :--- | :--- | | Other income and gains | 49,275 | 49,357 | Administrative Expenses Administrative expenses slightly increased, mainly due to higher directors' bonuses. Administrative Expenses (HK$ thousand) | Indicator | FY2025 | FY2024 | | :--- | :--- | :--- | | Administrative expenses | 88,121 | 87,707 | - The increase in administrative expenses was primarily due to higher directors' bonuses[77][83] Impairment on Property, Plant and Equipment Due to a downturn in the Hong Kong property market, the Group recognized an impairment loss on leasehold land of HK$199,043,000. Impairment on Property, Plant and Equipment (HK$ thousand) | Year | Impairment Loss | | :--- | :--- | | 2025 | 199,043 | | 2024 | – | Finance Costs Finance costs decreased by 16.4%, primarily due to the repayment of a term loan during the year. Finance Costs (HK$ thousand) | Year | Finance Costs | | :--- | :--- | | 2025 | 29,049 | | 2024 | 34,761 | - The 16.4% decrease in finance costs was primarily due to the repayment of a term loan during the year[79][85] Share of Profits and Losses of Joint Ventures Share of profits from joint ventures increased, mainly attributable to Gold Victory Resources Inc. and its subsidiaries. Share of Profits and Losses of Joint Ventures (HK$ thousand) | Year | Profit | | :--- | :--- | | 2025 | 785 | | 2024 | 184 | Share of Profits and Losses of Associates Profit from associates was recognized for the first time this year, primarily from Synergy Materials Limited and its subsidiaries. Share of Profits and Losses of Associates (HK$ thousand) | Year | Profit | | :--- | :--- | | 2025 | 1,593 | | 2024 | – | Income Tax Expense Income tax expense significantly increased by 95.4%, mainly due to the recognition of non-deductible impairment losses. Income Tax Expense (HK$ thousand) | Year | Income Tax Expense | | :--- | :--- | | 2025 | 89,375 | | 2024 | 45,728 | - Income tax expense increased by 95.4%, while profit before tax increased by 26.9%, with the difference primarily due to the recognition of non-deductible impairment losses of approximately HK$199,043,000[82][88] Profit Attributable to Owners of the Parent Profit attributable to owners of the parent increased by 11.6% year-on-year, reflecting an improvement in the Group's overall profitability. Profit Attributable to Owners of the Parent (HK$ thousand) | Year | Profit | | :--- | :--- | | 2025 | 228,562 | | 2024 | 204,889 | - Profit attributable to owners of the parent increased by 11.6% year-on-year[89][94] Financial Review The Group maintains a robust capital structure with zero net gearing ratio, though cash and cash equivalents decreased; this section details changes in assets and liabilities, and discloses charges on assets, contingent liabilities, and capital commitments. - As of March 31, 2025, the Group's total equity was HK$1,735,065,000, with a net gearing ratio of zero[90][91][95] - Cash and cash equivalents decreased by 16.2% to HK$1,741,032,000, primarily due to the repayment of a term loan[92][95] - The current ratio remained at a healthy level of 0.96[92][95] - Property, plant and equipment increased to HK$1,788,769,000, mainly due to construction costs incurred for the redevelopment of 7 Lai Yip Street site[101][104] - Other payables and accruals decreased, primarily due to a reduction in contract work provisions by HK$423,024,000[109][113] Capital Structure, Liquidity and Financial Resources The Group maintains a robust capital structure with zero net gearing ratio, but cash and cash equivalents decreased due to loan repayments, while the current ratio remained stable. Capital Structure and Liquidity (HK$ thousand) | Indicator | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Total equity | 1,735,065 | 1,617,566 | | Net gearing ratio | Zero | Zero | | Cash and cash equivalents | 1,741,032 | 2,077,918 | | Current ratio | 0.96 | 0.97 | - Bank credit facilities amounted to HK$2,124,200,000, of which HK$1,554,825,000 remained unutilized[93][96] Interest and Foreign Exchange Exposure The Group's bank borrowings are denominated in HKD and bear floating interest rates, operating primarily in Hong Kong and mainland China, thus facing foreign currency exchange risk, but no hedging activities were undertaken. - Bank borrowings are denominated in HKD and bear floating interest rates[98][103] - No interest rate or currency hedging or speculative activities were undertaken during the current or previous year[100][103] Property, Plant and Equipment The total amount of property, plant and equipment increased, mainly due to construction costs incurred for the redevelopment of 7 Lai Yip Street site. Property, Plant and Equipment (HK$ thousand) | Year | Amount | | :--- | :--- | | 2025 | 1,788,769 | | 2024 | 1,612,720 | - The increase was primarily due to construction costs incurred for the redevelopment of the site at 7 Lai Yip Street, Kwun Tong, Kowloon, Hong Kong[101][104] Financial Assets at Fair Value through Profit or Loss This balance represents the cash surrender value of life insurance policies purchased for an executive director and a senior management member. - The balance represents the cash surrender value of life insurance policies purchased for an executive director and a senior management member[105] Accounts Receivable Accounts receivable primarily consist of trade receivables from contract works, with 100% collected shortly after the reporting period. - 100% of accounts receivable as of March 31, 2025, were collected by May 13, 2025[106][110] Contract Assets Contract assets, primarily comprising retention receivables and unbilled revenue, have increased in amount. Contract Assets (HK$ thousand) | Indicator | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Retention receivables | 586,886 | 445,540 | | Unbilled revenue | 661,135 | 368,620 | Prepayments, Other Receivables and Other Assets Prepayments, other receivables, and other assets decreased, mainly due to the repayment of a loan by a joint operation partner. - The decrease was primarily due to the repayment of a loan by a joint operation partner during the year[108][112] Other Payables and Accruals Other payables and accruals decreased, mainly due to a reduction in contract work provisions by HK$423,024,000. - The decrease was primarily due to a reduction in contract work provisions by HK$423,024,000, as certain completed projects may generate economic benefits[109][113] Charges on Assets Some of the Group's bank loans are secured by financial interests in contract works and deposit accounts, and while some property, plant and equipment were previously pledged, the related bank loans have been fully repaid. - Bank loans are secured by unbilled revenue and retention receivables from contract works[115][121] - Some bank loans are secured by deposit accounts opened with the relevant banks[116][121] - For the year ended March 31, 2025, the related bank loans have been fully repaid, but the relevant pledges have not yet been released[117][121] Contingent Liabilities Details of contingent liabilities are provided in Note 34 to the financial statements. - Details of contingent liabilities are provided in Note 34 to the financial statements[118][122] Capital Commitments Details of capital commitments are provided in Note 35 to the financial statements. - Details of capital commitments are provided in Note 35 to the financial statements[119][123] Significant Investment Held and Future Plans for Material Investments on Capital Assets As of March 31, 2025, the Group held no significant investment plans but is actively researching and evaluating various investment opportunities. - As of March 31, 2025, the Group held no significant investment plans[120][124] - The Group is currently researching and evaluating various investment opportunities[120][124] Framework Agreements with Lanon Development The Group entered into framework agreements with Lanon Development Limited (an associate) to provide contracting services, aiming to expand and diversify the Group's contracting capabilities and client base. - The framework agreements were entered into on February 18, 2022, and are valid until March 31, 2025[125][129] - These agreements constitute continuing connected transactions and were approved by independent shareholders on June 9, 2022[126][130] - The Board believes the agreements help expand and diversify the Group's capabilities as a contractor or subcontractor and broaden its potential client base[128][131] Framework Agreements with WHSE The Group entered into framework agreements with WHSE Enterprise Limited (an associate) to expand its Modular Integrated Construction (MiC) business, enhance plant utilization, and benefit from government promotion of MiC. - The framework agreements were entered into on August 29, 2024, and are valid until March 31, 2027[133][136] - These agreements constitute continuing connected transactions and were approved by independent shareholders on November 29, 2024[134][137] - The Group believes collaboration with WHSE is a good opportunity to expand its MiC business, enhance plant utilization, and benefit from government promotion of MiC[135][137] Employees and Remuneration Policy As of March 31, 2025, the Group employed approximately 630 full-time employees, with a remuneration policy based on performance and experience, offering various benefits and a share option scheme. Number of Full-time Employees | Year | Number of Employees | | :--- | :--- | | 2025 | 630 | | 2024 | 468 | - The remuneration policy is based on employee performance, work experience, and market conditions, offering discretionary bonuses, share options, pension schemes, medical insurance, and other benefits[138][140] - The share option scheme aims to incentivize directors and full-time employees, but no share options have been granted since its adoption up to March 31, 2025[139][140] Biographical Details of Directors and Senior Management This section provides biographical details of the Group's executive directors, independent non-executive directors, and senior management, highlighting their professional backgrounds and responsibilities. Executive Directors This section introduces Mr. Yau Kwok Fai (Chairman) and Mr. Li Hang Ying (Chief Executive Officer), detailing their backgrounds, experience, and responsibilities, both possessing extensive experience in the construction industry. - Mr. Yau Kwok Fai (Chairman) has over 30 years of experience in the construction industry, responsible for board management, policy formulation, and the Group's overall development[141][142][144] - Mr. Li Hang Ying (Chief Executive Officer) was appointed on April 1, 2024, with over 30 years of experience in construction, project management, property development, etc., responsible for the Group's business operations[147][148][150] Independent Non-executive Directors This section introduces five independent non-executive directors—Professor Ko Chan Ming, Dr. Li Man Piu, Dr. Lee Yuk Cheung, Ms. Mak Shuk Hing, and Mr. Mong Chan—detailing their professional backgrounds and experience, and their role in providing independent advice to the Board. - The five independent non-executive directors possess extensive professional experience in fields such as structural engineering (Professor Ko Chan Ming), dentistry (Dr. Li Man Piu), civil engineering and education (Dr. Lee Yuk Cheung), education and management (Ms. Mak Shuk Hing), and finance and accounting (Mr. Mong Chan)[155][157][161][163][165][166][169][171][172][174][177] Senior Management This section introduces senior management members, including Mr. Ngai Chun Hung, Mr. Yam Kui Hung, Mr. Cheung Ho Yuen, and Mr. Lau Chi Fai, detailing their backgrounds and responsibilities, all possessing years of experience in the construction industry. - Mr. Ngai Chun Hung is a controlling shareholder of the company, previously served as Chairman and Executive Director, and is now responsible for operational support for contract works[184][190] - Mr. Yam Kui Hung is responsible for the Group's quality assessment, project risk management, and internal control systems[186][192] - Mr. Cheung Ho Yuen is responsible for the Group's strategy implementation, project estimation, subcontracting, and procurement management[193][197] - Mr. Lau Chi Fai is responsible for the Group's project management and contract administration, and resigned as Executive Director on April 1, 2025[195][196][197] Corporate Governance Report This section details the company's corporate governance practices, including compliance with the CG Code, board structure, committee functions, and policies on director development, dividends, and risk management. Compliance with the CG Code The company has complied with all code provisions of the Corporate Governance Code throughout the year ended March 31, 2025. - The company has complied with all code provisions contained in the Corporate Governance Code throughout the entire year ended March 31, 2025[199][201] The Board The Board is responsible for the company's overall management and strategic direction, ensuring effective corporate governance, with detailed information on its composition, meetings, independence assessment of INEDs, and director appointment and re-election procedures. - The Board is responsible for formulating key policies, strategic plans, overseeing management performance, and establishing risk management and internal control systems[203][205] - As of March 31, 2025, the Board comprised 3 executive directors, 1 non-executive director, and 5 independent non-executive directors[206][207][210] - The Board consistently complies with the Listing Rules regarding the number and professional qualifications of independent non-executive directors[211][216] - All independent non-executive directors are appointed for a term of two years and have submitted annual confirmations of independence[213][217] The INEDs The company's independent non-executive directors possess high qualifications and professional experience, providing independent and constructive advice to the Board, and meeting the independence requirements of the Listing Rules. - The Board consistently complies with the Listing Rules requirement for at least three independent non-executive directors, with at least one possessing appropriate accounting or related financial management expertise[211][216] - The five independent non-executive directors possess professional qualifications and experience in engineering, education, dentistry, and accounting and finance[212][216] - All independent non-executive directors are appointed for a term of two years and have submitted annual confirmations of independence[213][217] Meetings The Board holds at least four regular meetings annually and ensures directors receive meeting materials in a timely manner, with all directors actively participating. - The Board holds at least four regular meetings annually and convenes ad-hoc meetings as needed[224][228] - Meeting notices are issued at least 14 days in advance, and meeting papers are sent to directors at least 7 days prior to the meeting[226][228] Board and Committee Meeting Attendance (FY2025) | Director | Board | Audit Committee | Remuneration Committee | Nomination Committee | Chairman and INEDs | Independent Directors Committee | AGM | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Yau Kwok Fai | 4/4 | N/A | 3/3 | 3/3 | 1/1 | N/A | 1/1 | | Mr. Li Hang Ying | 4/4 | N/A | N/A | N/A | N/A | N/A | 1/1 | | Mr. Lau Chi Fai | 4/4 | N/A | N/A | N/A | N/A | N/A | 1/1 | | Professor Ko Chan Ming | 4/4 | 4/4 | 3/3 | 3/3 | 1/1 | 2/2 | 1/1 | | Dr. Li Man Piu | 4/4 | 4/4 | 3/3 | 3/3 | 1/1 | 2/2 | 1/1 | | Dr. Lee Yuk Cheung | 4/4 | 4/4 | 3/3 | 3/3 | 1/1 | 2/2 | 1/1 | | Ms. Mak Shuk Hing | 4/4 | 4/4 | 3/3 | 3/3 | 1/1 | 2/2 | 1/1 | | Mr. Mong Chan | 4/4 | 4/4 | 3/3 | 3/3 | 1/1 | 2/2 | 1/1 | Appointment, Re-election, Removal and Retirement of Directors The Board, through the Nomination Committee, regularly reviews its structure and diversity, adhering to director nomination and board diversity policies to ensure fair and effective appointment and re-election processes. - The Board, through the Nomination Committee, reviews its structure, size, composition, and diversity to ensure it possesses appropriate expertise, skills, and experience[233][236] - The "Board Diversity Policy" and "Director Nomination Policy" have been adopted to guide the nomination and selection of directors[234][236] - Directors serve for a term not exceeding three years and are subject to retirement by rotation at least once every three years, eligible for re-election[235][237] Chairman and Chief Executive Officer The company clearly delineates the responsibilities of the Chairman and Chief Executive Officer, with the Chairman overseeing board management and the CEO managing daily business operations, ensuring communication between independent non-executive directors and the Chairman. - The Chairman is responsible for leading the Board, while the Chief Executive Officer is responsible for leading management and daily operations[245][247][249][250] - The Chairman met with independent non-executive directors once without the presence of management to gather independent opinions[248][250] Board Committees The Board has three committees: Audit, Remuneration, and Nomination, each with clear terms of reference to oversee specific company matters, ensuring effective and transparent corporate governance. - The Audit Committee, composed of five independent non-executive directors with Mr. Mong Chan as Chairman, is responsible for reviewing financial statements and overseeing risk management and internal controls[253][254][256] - The Remuneration Committee, composed of five independent non-executive directors and one executive director with Dr. Li Man Piu as Chairman, is responsible for formulating remuneration policies for directors and senior management[263][264][265] - The Nomination Committee, composed of five independent non-executive directors and one executive director with Mr. Yau Kwok Fai as Chairman, is responsible for reviewing the Board's structure and identifying qualified director candidates[273][274][276] The Audit Committee The Audit Committee, comprising five independent non-executive directors with Mr. Mong Chan as Chairman, is responsible for reviewing financial statements, overseeing risk management and internal controls, and communicating with external auditors. - The Audit Committee is composed of five independent non-executive directors, with Mr. Mong Chan as Chairman, possessing appropriate accounting qualifications and financial experience[253][256] - Key responsibilities include reviewing consolidated financial statements, auditor's reports, overseeing risk management and internal control systems, and meeting with external auditors at least twice a year[254][255][256] The Remuneration Committee The Remuneration Committee, comprising five independent non-executive directors and one executive director with Dr. Li Man Piu as Chairman, is responsible for formulating remuneration policies for directors and senior management and evaluating their performance. - The Remuneration Committee is composed of five independent non-executive directors and one executive director, with Dr. Li Man Piu as Chairman[263][265] - Key responsibilities include advising the Board on remuneration policies and structures for directors and senior management, and evaluating the performance of executive directors[264][266] Senior Management Remuneration Bands (FY2025) | Remuneration Band (HK$) | Number of Individuals | | :--- | :--- | | 3,000,001 to 3,500,000 | 1 | | 3,500,001 to 4,000,000 | 1 | | 8,500,001 to 9,000,000 | 1 | The Nomination Committee The Nomination Committee, comprising five independent non-executive directors and one executive director with Mr. Yau Kwok Fai as Chairman, is responsible for reviewing the Board's structure, identifying qualified director candidates, and ensuring board diversity. - The Nomination Committee is composed of five independent non-executive directors and one executive director, with Mr. Yau Kwok Fai as Chairman[273][274] - Key responsibilities include annually reviewing the Board's structure, size, and diversity, identifying qualified director candidates, and assessing the independence of independent non-executive directors[276][278] - The Board Diversity Policy considers factors such as gender, age, culture, skills, background, experience, knowledge, and expertise[284][287] - Currently, one female director is among the seven Board members, accounting for approximately 14%[288] Directors' Continuous Professional Development The company encourages all directors to participate in continuous professional development to update their knowledge and skills, ensuring their contributions to the Board are well-informed and relevant. - The company provides monthly updates on the Group's latest developments to all Board members and offers comprehensive induction training for newly appointed directors[293][294][295] - All directors participated in seminars or read relevant journals on finance, accounting, taxation, construction, and environmental, social, and governance matters[298][299][300][301] Dividend Policy The company has adopted a written dividend policy to balance immediate shareholder returns with reserves needed for future Group growth, considering various financial and operational factors for dividend distribution. - The dividend policy was adopted on March 18, 2019, aiming to enhance transparency in dividend recommendations and declarations[303][306] - When determining dividends, the Board considers the Group's actual and expected financial performance, liquidity position, capital and debt levels, retained profits and distributable reserves, as well as working capital and future development plans[305][307] Securities Transactions of Directors and Employees The company has adopted the "Model Code for Securities Transactions by Directors of Listed Issuers" as the standard for directors' securities dealings and established an internal code for relevant employees no less exacting than the Model Code, to prevent insider trading. - All directors have confirmed compliance with the Model Code for the year ended March 31, 2025[309][312] - The company has issued "blackout period" notices to directors and employees, requiring all personnel not to deal in company securities when in possession of inside information[311][312] Auditor's Remuneration Ernst & Young has been re-appointed as the company's external auditor, and the Audit Committee oversees its provision of non-audit services to ensure independence and objectivity. - Ernst & Young has been re-appointed as the company's external auditor, with their term extending until the conclusion of the 2025 Annual General Meeting[313][316] Auditor's Remuneration (HK$ thousand) | Service Type | FY2025 | | :--- | :--- | | Audit services | 2,788 | | Tax services | 194 | - The Audit Committee has reviewed and determined that non-audit services do not impair the independence or objectivity of the external auditor[315][317] Company Secretary The Company Secretary supports the Board, ensures smooth information flow, policy compliance, and advises on governance matters; Ms. Lam Chun Chu was appointed Company Secretary on July 1, 2024. - The Company Secretary reports to the Chairman of the Board and the Chief Executive Officer[321][324] - Ms. Lam Chun Chu was appointed Company Secretary on July 1, 2024, and has confirmed compliance with all qualifications and training requirements of the Listing Rules[321][325] Risk Management and Internal Control The Board is responsible for maintaining effective risk management and internal control systems, employing a "four lines of defense model" for risk management, and implementing a whistleblowing policy and internal audit mechanism to ensure system effectiveness and adequacy. - The Board is collectively responsible for maintaining appropriate and effective risk management and internal control systems to safeguard shareholders' investments and the Group's assets[322][326] - The Group adopts a "four lines of defense model" for risk management, including culture, operations, oversight, and audit/whistleblowing[329][330] - A whistleblowing policy is in place to encourage employees to report improper conduct such as fraud and malpractice[332][336] - Both the Audit Committee and the Board consider the risk management and internal control systems to be effective and adequate for the reporting period[335][337] Communications with Shareholders and Investors The company is committed to maintaining high transparency in communications with shareholders and investors through various channels, including interim/annual reports, the company website, and general meetings. - The company has adopted a "Shareholder Communication Policy" to communicate with shareholders through channels such as interim/annual reports, the company website, and general meetings[339][342] - All directors and external auditors attended the 2024 Annual General Meeting to answer shareholder questions, and all resolutions were voted on by poll[341][343] Shareholders' Rights Shareholders have the right to requisition an extraordinary general meeting in accordance with the company's articles of association and may submit inquiries to the Board. - Shareholders holding not less than one-tenth of the company's paid-up share capital have the right to requisition the Board to convene an extraordinary general meeting[344][347] - Shareholders have the right to ask questions at general meetings or send inquiries to the company's principal place of business[351][356] Responsibility Statement in Respect of Financial Statements The directors confirm their responsibility for preparing the financial statements, ensuring they present a true and fair view of the company's affairs, and are based on a going concern basis. - The directors acknowledge and understand their responsibility for preparing the financial statements for the year ended March 31, 2025, ensuring they present a true and fair view of the company's and Group's affairs on a going concern basis[352][357] - The directors are not aware of any material uncertainties or conditions that may cast significant doubt upon the company's and Group's ability to continue as a going concern[357] Report of the Directors This section provides the directors' report, covering the Group's principal activities, business review, financial results, dividend proposals, risk management, and corporate governance. Principal Activities The company's principal activities are investment holding and providing corporate management services, while the Group primarily engages in building construction, maintenance, alteration, addition works, piling works, and sales of precast building components in Hong Kong. - The company's principal activities are investment holding and providing corporate management services[362][366] - The Group primarily engages in building construction, maintenance, alteration, addition works, piling works, and sales of precast building components in Hong Kong[362][366] Business Review The Group's business review, financial performance analysis, future business development, and key risks and uncertainties are detailed in the "Five-Year Financial Summary" and "Management Discussion and Analysis" sections; the Group is committed to environmental protection and compliance with applicable laws and regulations. - The Group is committed to being an environmentally friendly enterprise and has adopted environmental management systems compliant with international standards[364][367] - For the year ended March 31, 2025, the Group had no material non-compliance with laws and regulations that significantly affected its business and operations[368][374] Results and Dividend The Group's FY2025 profit and financial position are presented in the audited consolidated financial statements; the Board recommends a final dividend of 6.0 HK cents per share, totaling HK$120 million, subject to shareholder approval. Final Dividend (HK cents) | Year | Dividend per Share | | :--- | :--- | | 2025 | 6.0 | | 2024 | 5.0 | - Based on 2,000,000,000 issued ordinary shares, the total final dividend amounts to HK$120,000,000[371][376] Annual General Meeting and Closure of Register of Shareholders The company's 2025 Annual General Meeting will be held on August 28, 2025, and the share register will be closed from August 25 to August 28, 2025, to determine eligibility for attendance and voting. - The 2025 Annual General Meeting will be held on Thursday, August 28, 2025, in Hong Kong[373][378] - To determine eligibility for attendance and voting, the share register will be closed from Monday, August 25, 2025, to Thursday, August 28, 2025[379][382] Dividend Payment and Closure of Register of Shareholders If the final dividend is approved, the share register will be closed from September 3 to September 5, 2025, to determine dividend entitlements, with payment expected on or before September 26, 2025. - To determine entitlement to the final dividend, the share register will be closed from Wednesday, September 3, 2025, to Friday, September 5, 2025[380][383] - The final dividend is expected to be paid on or before Friday, September 26, 2025, to shareholders entitled to receive it[380][383] Risk Management The Group faces business and market risks, construction risks, compliance risks, reliance on key management personnel risks, business partner risks, and cyber and information security risks, which are managed and mitigated through various measures. - Business and market risks: cyclical demand, high reliance on public sector projects, potential impact from government spending cuts or contract delays[385][386][389] - Construction risks: involve price fluctuations, project timelines, quality, environmental, and safety requirements, managed through risk transfer, improved communication, and implementation of management systems[387][390] - Compliance risks: involve regulations related to construction, labor, occupational health and safety, and environmental protection; non-compliance may lead to legal sanctions and financial losses[388][391] - Reliance on key management personnel risks: managed by offering competitive remuneration packages and purchasing life insurance[392][395] - Business partner risks: reliance on third-party subcontractors and joint ventures, managed by collaborating with reputable partners and closely monitoring their performance[393][396] - Cyber and information security risks: managed by implementing firewalls, anti-spam, anti-virus protection, and raising employee awareness[394][397] Financial Information and Capital Structure This report discloses changes in property, plant and equipment, bank borrowings, share capital, and share options, as well as distributable reserves and charitable donations; the Group maintains good relationships with major customers and suppliers. - Details of changes in property, plant and equipment are provided in Note 14 to the financial statements[398][404] - As of March 31, 2025, there were no changes in the company's authorized share capital, issued share capital, and share options[400][406] Distributable Reserves (HK$ thousand) | Year | Amount | | :--- | :--- | | 2025 | 677,980 | | 2024 | 676,288 | Charitable Donations (HK$ thousand) | Year | Amount | | :--- | :--- | | 2025 | 132 | | 2024 | – | - In FY2025, revenue from the top five customers accounted for approximately 100% of total revenue, with the largest customer accounting for approximately 55%[414][419] - In FY2025, the total subcontracting fees and material costs from the top five suppliers/subcontractors accounted for 37% of the total[415][419] Directors and Senior Management This report lists the Board members and confirms the independence of independent non-executive directors, disclosing their biographies, service contracts, remuneration, interests in transactions, competitive business interests, and securities interests. - Mr. Li Hang Ying, Professor Ko Chan Ming, and Dr. Li Man Piu will retire by rotation at the 2025 Annual General Meeting and are eligible for re-election[422][424] - Independent non-executive directors have confirmed their independence, and the Board considers all of them to be independent[423][425] - Mr. Ngai Chun Hung has confirmed compliance with the non-competition undertaking[426][433] Directors' Remuneration (HK$ thousand) | Indicator | FY2025 | FY2024 | | :--- | :--- | :--- | | Fees | 1,200 | 1,200 | | Other emoluments | 27,079 | 46,137 | | Total | 28,279 | 47,337 | - As of March 31, 2025, Mr. Ngai Chun Hung held 1,500,000,000 shares, representing 75.000% of the issued share capital, through controlled corporations[449][451] - No share options have been granted under the share option scheme since its adoption up to the end of the reporting period[458][461] Substantial Shareholders' Interests in Securities This report discloses the interests of substantial shareholders in the company's securities, including shareholdings of Golden Lux Holdings Limited, Golden More Limited, and Ms. Cheng Wai Chun, as well as continuing connected transactions with Lanon Development and WHSE Enterprise. Substantial Shareholders' Interests in Shares (March 31, 2025) | Shareholder Name/Designation | Capacity and Nature of Interest | Number of Shares Interested | Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Golden Lux | Beneficial owner | 1,500,000,000 | 75.00 | | Golden More | Interest in controlled corporation | 1,500,000,000 | 75.00 | | Ms. Cheng Wai Chun | Interest in controlled corporation and spouse's interest | 1,500,000,000 | 75.00 | - The framework subcontracting agreement and framework contracting agreement with Lanon Development constitute continuing connected transactions; in FY2025, the total subcontracting fees paid by the Group to Lanon Development were HK$602 million, not exceeding the annual cap of HK$690 million[471][477][478] - The framework subcontracting agreement and framework contracting agreement with WHSE Enterprise constitute continuing connected transactions; in FY2025, the total subcontracting fees paid by the Group to WHSE Enterprise were HK$59 million, not exceeding the annual cap of HK$498 million[479][486][487] - Independent non-executive directors have reviewed the continuing connected transactions and confirmed they were conducted in the ordinary course of business on normal commercial terms and did not exceed the specified annual caps[486][489] Retirement Benefit Scheme The Group provides a Mandatory Provident Fund Scheme for its Hong Kong employees and a central pension scheme for employees of its mainland China subsidiaries, making contributions as required. - Hong Kong employees participate in the Mandatory Provident Fund Scheme, while employees of mainland China subsidiaries participate in central pension schemes operated by local municipal governments[495][496][501] - The Group makes contributions to the pension schemes as required, which are expensed in profit or loss[495][496][501] Sufficiency of Public Float As of the date of approval of this annual report, 25% of the company's total issued shares are held by the public, meeting the public float requirement. - As of the date of approval of this annual report, 25% of the company's total issued shares are held by the public[497][502] Events After the Reporting Period As of the date of approval of this annual report, the directors have not identified any significant post-reporting period events related to the Group's business or financial performance. - As of the date of approval of this annual report, the directors have not identified any significant events related to the Group's business or financial performance[499][504] Future Development of the Group's Business The outlook for the Group's future business development is elaborated in the "Outlook" sub-section of the "Chairman's Statement" section. - The outlook for the Group's future business development is elaborated in the "Outlook" sub-section under the "Chairman's Statement" section[500][505] Corporate Governance The company is committed to maintaining high standards of corporate governance through continuous improvement of its corporate governance practices, with relevant information detailed in the "Corporate Governance Report." - The company is committed to maintaining high standards of corporate governance through continuous efforts to improve its corporate governance practices[506][507] Review of Financial Statements The Audit Committee has reviewed the Group's consolidated financial statements for the year ended March 31, 2025, and recommended them for Board approval. - The Audit Committee has reviewed the Group's consolidated financial statements for the year ended March 31, 2025, including accounting principles and practices, and recommended them for Board approval[508][510] Auditor Ernst & Young has audited the consolidated financial statements and will be proposed for re-appointment at the upcoming Annual General Meeting. - Ernst & Young has audited the consolidated financial statements and will be proposed for re-appointment at the upcoming Annual General Meeting[509][511] - There has been no change in the company's auditor over