荣丰集团亚洲(08526) - 2025 - 中期财报

Report Overview GEM Characteristics and Disclaimer The report highlights GEM as a listing platform for SMEs, noting higher investment risks and advising investors to exercise caution, with HKEX and the Stock Exchange disclaiming responsibility for the report's content - The GEM market is positioned for small and medium-sized companies, entailing higher investment risks, potential for significant market volatility, and no guarantee of high liquidity[2] - Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited are not responsible for the contents of this report, make no representation, and accept no liability for any loss[2] Directors' Responsibility Statement The company's directors jointly and severally accept full responsibility for this report, confirming that the information contained is accurate, complete, not misleading or fraudulent in all material respects, and without omission - The company's directors jointly and severally accept full responsibility for this report, confirming the information is accurate, complete, not misleading or fraudulent, and without omission[3] Interim Results Unaudited Condensed Consolidated Statement of Comprehensive Income For the six months ended June 30, 2025, the Group turned from profit to loss, recording a net loss of HK$2,668 thousand, compared to a net profit of HK$2,315 thousand in the prior period, with revenue decreasing by 14.8% and gross profit significantly declining by 58.5% Key Data from Condensed Consolidated Statement of Comprehensive Income | Metric | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Revenue | 66,692 | 78,296 | (11,604) | -14.8% | | Cost of Sales | (61,294) | (65,298) | 4,004 | -6.1% | | Gross Profit | 5,398 | 12,998 | (7,600) | -58.5% | | Operating (Loss) Profit | (2,009) | 4,358 | (6,367) | -146.1% | | (Loss) Profit for the Period | (2,668) | 2,315 | (4,983) | -215.3% | | Basic and Diluted (Loss) Earnings Per Share (HK cents per share) | (1.64) | 1.43 | (3.07) | -214.7% | Unaudited Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets were HK$110,441 thousand, a 12.4% decrease from December 31, 2024, with both net assets and total equity declining Key Data from Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | Change (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total Assets | 110,441 | 126,118 | (15,677) | -12.4% | | Total Liabilities | 46,369 | 59,380 | (13,011) | -21.9% | | Net Assets/Total Equity | 64,072 | 66,738 | (2,666) | -4.0% | | Current Assets | 101,073 | 116,820 | (15,747) | -13.5% | | Current Liabilities | 46,366 | 59,324 | (12,958) | -21.8% | Unaudited Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash from operating activities shifted from an inflow of HK$676 thousand to an outflow of HK$6,994 thousand, while net cash from investing activities increased and net cash from financing activities turned from outflow to inflow Key Data from Condensed Consolidated Statement of Cash Flows | Metric | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Net Cash (Used in) From Operating Activities | (6,994) | 676 | (7,670) | | Net Cash From Investing Activities | 7,383 | 1,992 | 5,391 | | Net Cash From (Used in) Financing Activities | 708 | (3,869) | 4,577 | | Net Increase in Cash and Cash Equivalents | 1,097 | (1,201) | 2,298 | Unaudited Condensed Consolidated Statement of Changes in Equity As of June 30, 2025, the Group's total equity was HK$64,072 thousand, a decrease of HK$2,666 thousand from the beginning of the year, primarily due to the loss for the period Key Data from Condensed Consolidated Statement of Changes in Equity | Metric | Balance as at January 1, 2025 (HK$ thousand) | Loss for the Period (HK$ thousand) | Other Comprehensive Income (HK$ thousand) | Balance as at June 30, 2025 (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Total | 66,738 | (2,668) | 2 | 64,072 | Notes to the Unaudited Condensed Consolidated Financial Statements General Information The company, incorporated in the Cayman Islands, primarily provides supply, installation, and renovation services for building mechanical ventilation and air-conditioning systems; its shares were listed on GEM on February 27, 2018, and the interim financial statements, though unaudited, have been reviewed by the audit committee - The Group primarily engages in the supply, installation, and renovation services for building mechanical ventilation and air-conditioning systems[8] - The Company's shares were listed on GEM of the Stock Exchange on February 27, 2018[9] - The interim financial statements are unaudited but have been reviewed by the Company's audit committee[10] Basis of Preparation The interim financial statements are prepared in accordance with HKAS 34 and GEM Listing Rules disclosure requirements, using the historical cost convention, with no significant impact on financial performance or position from new and revised HKFRSs applied this period - The interim financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the disclosure requirements of the GEM Listing Rules[11] - The application of new and revised Hong Kong Financial Reporting Standards during the period had no significant impact on the Group's financial performance and position[11] Revenue and Segment Information The Group's revenue is derived from building mechanical ventilation and air-conditioning system services in Hong Kong and Macau, operating as a single segment; for the six months ended June 30, 2025, construction contract revenue was HK$66,692 thousand, a 14.8% year-on-year decrease - The Group's revenue is derived from building mechanical ventilation and air-conditioning system services in Hong Kong and Macau, with only one operating segment[12] Construction Contract Revenue | Metric | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Construction Contract Revenue | 66,692 | 78,296 | -14.8% | Geographical Information Revenue primarily originated from Hong Kong, accounting for 98.4% of total revenue, with Macau contributing a smaller portion; Hong Kong revenue decreased by 14.8% year-on-year, and Macau revenue decreased by 15.1% Revenue by Geographical Location | Region | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Hong Kong | 65,609 | 77,020 | -14.8% | | Macau | 1,083 | 1,276 | -15.1% | | Total | 66,692 | 78,296 | -14.8% | Major Customer Information Customer A and Customer B are the Group's major clients, contributing 74.6% and 16.7% of total revenue respectively, with revenue from both major clients decreasing Major Customer Revenue | Customer | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Customer A | 49,767 | 61,543 | -19.29% | | Customer B | 11,143 | 14,221 | -21.65% | Expenses by Nature Material costs significantly decreased by 36.4%, while subcontractor costs increased by 16.9%; employee benefit expenses slightly rose, and net impairment losses on trade receivables and contract assets shifted from provision to reversal Expenses by Nature | Expense Item | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Material Costs | 16,871 | 26,518 | -36.4% | | Subcontractor Costs | 38,707 | 33,102 | 16.9% | | Employee Benefit Expenses | 9,687 | 8,746 | 10.8% | | Net Impairment Loss (Reversal) Provision for Trade Receivables | (262) | 118 | -322.0% | | Net Impairment Loss (Reversal) Provision for Contract Assets | (219) | 263 | -183.3% | Income Tax Expense Income tax expense significantly decreased by 73.6%, primarily due to a reduction in deferred income tax, while Hong Kong Profits Tax and Macau Complementary Income Tax rates remained unchanged Income Tax Expense | Metric | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Income Tax Expense | 334 | 1,266 | -73.6% | | Deferred Income Tax | 334 | 1,068 | -68.7% | Hong Kong Profits Tax Hong Kong Profits Tax operates under a two-tiered tax rate system, with the first HK$2,000,000 of assessable profits taxed at 8.25% and the remainder at 16.5% - Hong Kong Profits Tax operates under a two-tiered tax rate system: the first HK$2,000,000 of assessable profits is taxed at 8.25%, and the remainder at 16.5%[18] Macau Complementary Income Tax Macau Complementary Income Tax is levied at a fixed rate of 12% on assessable income exceeding MOP600,000 - Macau Complementary Income Tax is levied at a fixed rate of 12% on assessable income exceeding MOP600,000 (approximately HK$582,000)[19] Dividends The Board does not recommend the payment of any dividends for the six months ended June 30, 2025, consistent with the prior period - The Board does not recommend the payment of any dividends for the six months ended June 30, 2025[20] Basic and Diluted (Loss) Earnings Per Share For the six months ended June 30, 2025, basic loss per share was 1.64 HK cents, compared to earnings per share of 1.43 HK cents in the prior period, with no potentially dilutive shares outstanding during the period Basic and Diluted (Loss) Earnings Per Share | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | (Loss) Profit Attributable to Owners of the Company (HK$ thousand) | (2,668) | 2,315 | | Weighted Average Number of Ordinary Shares in Issue | 162,250,000 | 162,250,000 | | Basic (Loss) Earnings Per Share (HK cents per share) | (1.64) | 1.43 | - The Company had no potentially dilutive shares outstanding during the period, thus diluted (loss) earnings per share equals basic (loss) earnings per share[22] Property, Plant and Equipment For the six months ended June 30, 2025, additions to property, plant and equipment amounted to HK$512,000, with no additions in the prior period Additions to Property, Plant and Equipment | Metric | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Additions to Property, Plant and Equipment | 512 | 0 | Trade and Other Receivables, Deposits and Prepayments As of June 30, 2025, total trade and other receivables, deposits, and prepayments amounted to HK$19,222 thousand, a significant decrease of 35.9% from December 31, 2024 Trade and Other Receivables, Deposits and Prepayments | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Trade Receivables (net of impairment) | 13,806 | 27,514 | -49.9% | | Other Receivables and Deposits | 1,068 | 1,017 | 5.0% | | Prepayments | 4,348 | 1,456 | 198.6% | | Total | 19,222 | 29,987 | -35.9% | Trade Receivables Trade receivables have a credit period ranging from 30 to 45 days; as of June 30, 2025, trade receivables (net of impairment) were HK$13,806 thousand, a 49.9% decrease from December 31, 2024 - The credit period for trade receivables ranges from 30 to 45 days[25] Ageing Analysis of Trade Receivables (net of impairment) | Ageing | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 9,540 | 9,235 | | 31 to 60 days | – | 5,072 | | 61 to 90 days | 4,048 | 8,928 | | 91 to 180 days | 136 | 728 | | 181 to 365 days | 82 | – | | Over one year | – | 3,551 | | Total | 13,806 | 27,514 | Pledged Bank Deposits and Cash and Cash Equivalents As of June 30, 2025, pledged bank deposits were zero, compared to HK$7,352 thousand on December 31, 2024, while cash and cash equivalents increased to HK$10,827 thousand Pledged Bank Deposits and Cash and Cash Equivalents | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Pledged bank deposits | – | 7,352 | | Cash and cash equivalents | 10,827 | 16,576 | | Bank overdrafts | – | (6,848) | | Total | 10,827 | 9,728 | - Pledged bank deposits refer to deposits pledged for the Group's bank financing, which were no longer present as of June 30, 2025[28] Trade Payables and Retention Monies As of June 30, 2025, total trade payables and retention monies amounted to HK$24,334 thousand, a 19.1% decrease from December 31, 2024, with credit terms generally ranging from 30 to 60 days Trade Payables and Retention Monies | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Trade Payables | 16,386 | 21,714 | -24.6% | | Retention Monies Payable | 7,948 | 8,361 | -5.0% | | Total | 24,334 | 30,075 | -19.1% | - The credit period granted by subcontractors and suppliers for trade payables generally ranges from 30 to 60 days after the issuance of invoices or application for interim payments[29] Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 9,365 | 10,173 | | 31 to 60 days | 2,978 | 5,163 | | 61 to 90 days | 1,119 | 3,916 | | 91 to 180 days | 363 | 1,628 | | 181 days to one year | 1,774 | 47 | | Over one year | 787 | 787 | | Total | 16,386 | 21,714 | Bank Borrowings As of June 30, 2025, total bank borrowings were HK$19,383 thousand, a 23.0% decrease from December 31, 2024; these borrowings are secured by corporate guarantees, personal guarantees from a director, and properties held by the director, with effective annual interest rates ranging from 3.0% to 6.0% Total Bank Borrowings | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Bank borrowings | 19,383 | 18,317 | 5.8% | | Bank overdrafts | – | 6,848 | -100.0% | | Total | 19,383 | 25,165 | -23.0% | - Bank borrowings are secured by corporate guarantees (HK$47,971 thousand), personal guarantees from Mr. Chung Chi Keung (HK$30,000 thousand and HK$9,000 thousand), a director, and properties held by Mr. Chung[34] - The effective annual interest rate for bank borrowings ranges from 3.0% to 6.0% (December 31, 2024: 3.0% to 6.625%)[33] Maturity Analysis of Bank Borrowings | Maturity Period | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Within one year | 12,245 | 17,565 | | 1 to 2 years | 943 | 929 | | 2 to 5 years | 3,004 | 2,960 | | Over 5 years | 3,191 | 3,711 | | Total | 19,383 | 25,165 | Share Capital As of June 30, 2025, the Company's issued share capital was HK$6,490 thousand, comprising 162,250,000 ordinary shares of HK$0.04 each, consistent with December 31, 2024 Issued and Fully Paid Share Capital | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Par value per share | HK$0.04 | HK$0.04 | | Number of shares | 162,250,000 | 162,250,000 | | Total (HK$ thousand) | 6,490 | 6,490 | Contingent Liabilities As of June 30, 2025, the Group provided corporate guarantees of approximately HK$13,853 thousand to a customer as indemnity for four construction contracts, none of which were enforced during the period - The Group provided corporate guarantees of approximately HK$13,853 thousand to a customer as indemnity for four construction contracts[36] - No corporate guarantees were enforced for the six months ended June 30, 2025, or for the year ended December 31, 2024[36] Related Party Disclosures Total remuneration for key management personnel (Board and senior management) amounted to HK$3,416 thousand, slightly higher than the prior period Key Management Personnel Remuneration | Remuneration Item | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Salaries and other benefits | 3,389 | 3,380 | 0.3% | | Contributions to retirement benefit schemes | 27 | 27 | 0.0% | | Total | 3,416 | 3,407 | 0.3% | Management Discussion and Analysis Business Review and Outlook The Group primarily provides mechanical ventilation and air-conditioning system services in Hong Kong and Macau; despite economic recovery, the Hong Kong construction market remains weak with intensified competition, facing challenges like high financial costs, weak demand, and labor shortages; the period recorded a loss mainly due to project delays reducing revenue and cost overruns; future plans include cautious exploration of new revenue streams, resource optimization, and identifying investment opportunities - The Group primarily provides mechanical ventilation and air-conditioning system supply, installation, and renovation services in Hong Kong and Macau[38] - The Hong Kong construction market faces a weak sentiment, intensified competition, high financial costs, weak demand, labor shortages, inflationary pressure, and project delays[38] - The Group secured a new project in July 2025 with an initial contract sum exceeding HK$175 million[38] - The Group recorded a loss of approximately HK$2.7 million for the period, primarily due to project delays caused by economic downturn, resulting in a revenue decrease of approximately HK$11.6 million, and cost overruns from delayed completion of several projects[39] - The Group will continue to explore cooperation with new clients, develop new revenue streams, optimize resource utilization and efficiency, and identify other investment opportunities[40] Financial Review Revenue, cost of sales, gross profit, and gross margin all decreased this period, leading to a shift from profit to loss; administrative and income tax expenses declined, while the current ratio improved and the gearing ratio decreased - The Group recognized a loss of approximately HK$2.7 million for the relevant period, compared to a profit of approximately HK$2.3 million in the prior period[46] Key Liquidity and Financial Resources Metrics | Metric | June 30, 2025 | December 31, 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Total Assets (HK$ million) | 110.4 | 126.1 | -12.4% | | Total Liabilities (HK$ million) | 46.4 | 59.4 | -21.9% | | Shareholders' Equity (HK$ million) | 64.0 | 66.7 | -4.0% | | Total Interest-bearing Borrowings (HK$ million) | 19.4 | 25.2 | -23.0% | | Current Ratio | 2.2 times | 2.0 times | 10.0% | | Gearing Ratio | 30.4% | 38.0% | -19.9% | Revenue Revenue decreased by 14.8% year-on-year to HK$66.7 million, primarily due to reduced work volume in existing projects (especially Kai Tak and Chek Lap Kok), partially offset by revenue growth from new projects (Wong Chuk Hang) and some existing projects (Tseung Kwan O) Revenue Change | Metric | Six Months Ended June 30, 2025 (HK$ million) | Six Months Ended June 30, 2024 (HK$ million) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 66.7 | 78.3 | -14.8% | - The decrease in revenue was primarily due to a reduction in work volume from existing projects of approximately HK$35.4 million, partially offset by increased revenue from new projects (Wong Chuk Hang) of approximately HK$21.1 million and increased work volume from existing projects (Tseung Kwan O) of approximately HK$3.5 million[41] Cost of Sales Cost of sales decreased by 6.1% year-on-year to HK$61.3 million, primarily due to reduced material costs, partially offset by increased subcontractor costs resulting from delayed completion of certain projects Cost of Sales Change | Metric | Six Months Ended June 30, 2025 (HK$ million) | Six Months Ended June 30, 2024 (HK$ million) | Change Rate | | :--- | :--- | :--- | :--- | | Cost of Sales | 61.3 | 65.3 | -6.1% | - The decrease in cost of sales was primarily due to reduced material costs, partially offset by increased subcontractor costs resulting from delayed completion of certain projects[42] Gross Profit and Gross Margin Gross profit significantly decreased by 58.5% year-on-year to HK$5.4 million, with gross margin falling from 16.6% to 8.1%, primarily due to project cost overruns caused by delayed completion of certain projects Gross Profit and Gross Margin Change | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Gross Profit (HK$ million) | 5.4 | 13.0 | -58.5% | | Gross Margin | 8.1% | 16.6% | -51.2% | - The decrease in gross profit and gross margin was primarily due to project cost overruns resulting from delayed completion of certain Group projects[43] Administrative Expenses Administrative expenses decreased by 4.8% year-on-year to HK$8.0 million, primarily due to a reduction in legal and professional fees Administrative Expenses Change | Metric | Six Months Ended June 30, 2025 (HK$ million) | Six Months Ended June 30, 2024 (HK$ million) | Change Rate | | :--- | :--- | :--- | :--- | | Administrative Expenses | 8.0 | 8.4 | -4.8% | - The decrease in administrative expenses was primarily due to a reduction in legal and professional fees[44] Income Tax Expense Income tax expense decreased by 76.9% year-on-year to HK$0.3 million, primarily due to a reduction in deferred income tax resulting from lower utilization of tax losses carried forward from prior years Income Tax Expense Change | Metric | Six Months Ended June 30, 2025 (HK$ million) | Six Months Ended June 30, 2024 (HK$ million) | Change Rate | | :--- | :--- | :--- | :--- | | Income Tax Expense | 0.3 | 1.3 | -76.9% | - The decrease in income tax expense was primarily due to a reduction in deferred income tax resulting from lower utilization of tax losses carried forward from prior years[45] Loss/Profit for the Period The Group recognized a loss of approximately HK$2.7 million for the period, compared to a profit of approximately HK$2.3 million in the prior period, primarily impacted by the aforementioned revenue decline and cost overruns Loss/Profit for the Period | Metric | Six Months Ended June 30, 2025 (HK$ million) | Six Months Ended June 30, 2024 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | (Loss) Profit for the Period | (2.7) | 2.3 | (5.0) | Liquidity and Financial Resources Total assets and liabilities both decreased; total interest-bearing borrowings fell by 23.0% to HK$19.4 million, and the current ratio improved from 2.0 times to 2.2 times, indicating enhanced liquidity Key Liquidity Metrics | Metric | June 30, 2025 (HK$ million) | December 31, 2024 (HK$ million) | Change Rate | | :--- | :--- | :--- | :--- | | Total Assets | 110.4 | 126.1 | -12.4% | | Total Liabilities | 46.4 | 59.4 | -21.9% | | Total Interest-bearing Borrowings | 19.4 | 25.2 | -23.0% | | Current Ratio | 2.2 times | 2.0 times | 10.0% | - The Group's borrowings and bank balances are primarily denominated in Hong Kong Dollars, with no significant foreign exchange rate fluctuation risk during the period[47] Gearing Ratio The gearing ratio decreased from 38.0% to 30.4%, primarily due to the combined effect of reduced total interest-bearing borrowings and a decrease in total equity resulting from the net loss for the period Gearing Ratio | Metric | June 30, 2025 | December 31, 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Gearing Ratio | 30.4% | 38.0% | -19.9% | - The decrease in the gearing ratio was primarily due to the combined effect of reduced total interest-bearing borrowings and a decrease in total equity resulting from the net loss for the period[48] Capital Structure The Company's shares were listed on GEM on February 27, 2018; following placing and share consolidation, as of June 30, 2025, the issued share capital was HK$6,490 thousand, comprising 162,250,000 ordinary shares of HK$0.04 each - The Company's shares were listed on GEM of the Stock Exchange on February 27, 2018[49] - As of June 30, 2025, the Company's issued share capital was HK$6,490 thousand, comprising 162,250,000 ordinary shares of HK$0.04 each[50] Capital Commitments As of June 30, 2025, and December 31, 2024, the Group had no capital commitments contracted but not yet provided for - The Group had no capital commitments contracted but not yet provided for[51] Future Plans for Material Investments and Capital Assets Except as disclosed in this report, as of June 30, 2025, the Group had no future plans for material investments or capital assets - The Group had no future plans for material investments or capital assets[52] Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures During the relevant period, the Group had no material acquisitions or disposals of subsidiaries and associated companies - The Group had no material acquisitions or disposals of subsidiaries and associated companies during the relevant period[53] Contingent Liabilities Except for corporate guarantees disclosed in Note 14 to the financial statements, the Group had no other material contingent liabilities at the end of the reporting period - Except for corporate guarantees disclosed in Note 14 to the financial statements, the Group had no other material contingent liabilities at the end of the reporting period[54] Foreign Exchange Risk The Group's operations are primarily transacted in Hong Kong Dollars and Macau Pataca, with directors deeming foreign exchange risk to be minimal, and no derivative instruments or financial tools were entered into to hedge foreign exchange risk during the period - The Group's operations are primarily transacted in Hong Kong Dollars and Macau Pataca, with foreign exchange risk deemed minimal[55] - No derivative instruments or financial tools were entered into during the period to hedge foreign exchange risk[55] Pledge of Assets Except for pledged bank deposits disclosed in Note 10 to the financial statements, the Group had no other pledges of assets at the end of the reporting period - Except for pledged bank deposits disclosed in Note 10 to the financial statements, the Group had no other pledges of assets at the end of the reporting period[56] Employees and Remuneration Policy As of June 30, 2025, the Group employed 254 staff, including 207 subcontractor-nominated workers; staff costs (including directors' emoluments) were approximately HK$9.7 million, a 9.0% year-on-year increase; the company offers competitive remuneration, retirement benefits, medical benefits, and training subsidies Employee and Remuneration Information | Metric | June 30, 2025 | June 30, 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Total number of employees | 254 | Not applicable | Not applicable | | Staff costs (HK$ million) | 9.7 | 8.9 | 9.0% | - The Group promotes employees based on individual performance and development potential, offering a competitive remuneration package, retirement benefits, medical benefits, and subsidized training courses[57] Dividends The Board does not recommend the payment of any dividends for the relevant period, consistent with the prior period - The Board does not recommend the payment of any dividends for the relevant period[58] Events After Reporting Period As of the date of this report, no significant events have occurred after June 30, 2025 - As of the date of this report, no significant events have occurred after June 30, 2025[59] Disclosure of Interests Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares or Debentures As of June 30, 2025, Mr. Chung Chi Keung, Chairman and Chief Executive Officer, held 83,062,500 shares through his wholly-owned Wing Fung Capital Limited, representing 51.19% of the issued share capital, making him the Company's controlling shareholder Directors' and Chief Executive's Shareholdings | Director Name | Capacity/Nature of Interest | Number of Shares Interested | Long/Short Position | Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Mr. Chung | Interest in controlled corporation | 83,062,500 | Long position | 51.19% | - Mr. Chung holds shares through his wholly-owned Wing Fung Capital Limited, is deemed to have an interest, and serves as an Executive Director, Chairman and Chief Executive Officer, and controlling shareholder of the Company[60] Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares, Underlying Shares or Debentures As of June 30, 2025, other than directors, Wing Fung Capital Limited, as beneficial owner, held 83,062,500 shares, representing 51.19% of the issued share capital, making it a substantial shareholder Substantial Shareholders' Shareholdings | Shareholder Name | Capacity/Nature of Interest | Number of Shares Interested | Long/Short Position | Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Wing Fung Capital Limited | Beneficial owner | 83,062,500 | Long position | 51.19% | Other Corporate Governance and Risk Information Directors' Right to Acquire Shares During the relevant period, neither the Company nor any of its associated corporations entered into any arrangements enabling directors to acquire benefits by subscribing for shares or debentures of the Company or any other body corporate - During the relevant period, neither the Company nor any of its associated corporations entered into any arrangements enabling directors to acquire benefits by subscribing for shares or debentures of the Company or any other body corporate[65] Purchase, Sale and Redemption of Listed Securities During the relevant period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities, and the Company held no treasury shares - During the relevant period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[66] - As of June 30, 2025, the Company held no treasury shares[66] Code of Conduct for Securities Transactions by Directors The Group has adopted a code of conduct for directors' securities transactions no less stringent than the GEM Listing Rules, and all directors confirmed compliance with the relevant standards - The Group has adopted a code of conduct for directors' securities transactions, the terms of which are no less stringent than those set out in the GEM Listing Rules[67] - All directors confirmed compliance with the required standards of dealing in securities during the relevant period[67] Corporate Governance Code The Company has adopted and complied with the Corporate Governance Code in Appendix C1 of the GEM Listing Rules, though the roles of Chairman and Chief Executive Officer are combined in Mr. Chung, which the Board believes is in the Group's best interest - The Company's corporate governance practices are based on the principles and code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules[69] - The roles of Chairman and Chief Executive Officer are combined in Mr. Chung, which the Board believes is in the best interest of the Group[69] Competing Interests During the relevant period, the directors were unaware of any business or interest of directors, controlling shareholders, or their close associates that competed or might compete with the Group's business, nor any other conflicts of interest - During the relevant period, the directors were unaware of any business or interest of directors or controlling shareholders or their close associates that competed or might compete with the Group's business, nor any other conflicts of interest[71] Audit Committee The Audit Committee comprises three independent non-executive directors, with Mr. Choi Hiu Fai serving as Chairman and possessing the required professional qualifications; the Committee has reviewed the Group's unaudited condensed consolidated results and deemed them compliant with applicable accounting standards and GEM Listing Rules - The Audit Committee comprises three independent non-executive directors, with primary responsibilities including advising on the appointment of external auditors, reviewing financial statements, and monitoring risk management and internal control procedures[72] - Mr. Choi Hiu Fai serves as the Chairman of the Audit Committee and possesses the appropriate professional qualifications as required by the GEM Listing Rules[73] - The Audit Committee has reviewed the Group's unaudited condensed consolidated results and is of the opinion that they have complied with applicable accounting standards and the GEM Listing Rules and made adequate disclosures[73] Key Risks and Uncertainties The Group faces key risks including adverse impacts from epidemic outbreaks on operations and financial performance, reliance on successful bidding, inaccurate project duration and cost estimates, cost overruns and project delays, credit and liquidity risks from dependence on major customers, and reliance on key management - Epidemic outbreaks may lead to work suspensions, delayed material deliveries, increased costs, and other operational disruptions[74] - Business relies on successful bidding, and failure to secure contracts will impact revenue streams[74] - Incorrect or inaccurate estimates of project duration when determining bid prices may adversely affect profitability and financial performance[74] - Cost overruns and delays or defects in project progress by suppliers/subcontractors will adversely affect operations and financial results[74] - Reliance on major customers may expose the Group to credit and liquidity risks[74] - Reliance on key management may lead to significant adverse impacts on business operations and profitability if key team members depart[75] Changes in Directors' Information Mr. Lai Wai Ming resigned as an independent non-executive director and committee member, while Mr. Chan King Lun was appointed as an independent non-executive director and committee chairman/member; Ms. Lai Suk Fan was appointed as a Nomination Committee member, and Mr. Chung Chi Keung ceased to be a Nomination Committee member, all effective June 27, 2025 - Mr. Lai Wai Ming resigned as an independent non-executive director, chairman of the Remuneration Committee, and a member of both the Audit Committee and Nomination Committee, effective June 27, 2025[78] - Mr. Chan King Lun was appointed as an independent non-executive director, chairman of the Remuneration Committee, and a member of both the Audit Committee and Nomination Committee, effective June 27, 2025[78] - Executive Director Ms. Lai Suk Fan was appointed as a member of the Nomination Committee, and Executive Director Mr. Chung Chi Keung ceased to be a member of the Nomination Committee, both effective June 27, 2025[78]