Financial Performance - The company's profit attributable to equity holders was HKD 227.8 million, a decrease from HKD 419 million in 2021[13]. - Total revenue for the year was approximately HKD 204.5 million, down from HKD 1,779.7 million in 2021, primarily due to a significant drop in property sales[14]. - Gross profit decreased by approximately 81.3% to HKD 134.2 million, with a gross profit margin of 66%[15]. - The company reported a net loss of approximately HKD 675.9 million in other income and losses, primarily due to unrealized losses on bond investments[15]. - The tax expense for the year was approximately HKD 138.5 million, significantly higher than a tax credit of HKD 14.4 million in 2021[17]. - The company experienced a 35.1% decrease in rental and management fee income to approximately HKD 25.9 million, due to the sale of a UK investment property[14]. Cash and Investments - The company recorded a net cash position increase of approximately HKD 1.4 billion following the sale of a property project in Guangzhou[7]. - The total cash reserves, including bond investments, amounted to HKD 1.9531 billion, while bank borrowings stood at HKD 1.255 billion[8]. - The group's cash and bank balances amounted to HKD 1,524,900,000, an increase from HKD 679,000,000 in 2021, while total bond investments were HKD 428,200,000[96]. - The group recorded a pre-tax loss of HKD 620,500,000 from bond investments, including interest income of HKD 64,800,000 and a net realized loss of HKD 14,800,000 from bond sales[93]. - The total face value of overdue bonds during the year was approximately HKD 90,800,000, with a market value of about HKD 12,300,000 as of March 31, 2022[88]. Property Development and Sales - Total sales revenue from the residential units in Tuen Mun amounted to approximately HKD 1,718,500,000, with 371 residential units sold[47]. - The remaining 6 residential units and 4 parking spaces in Tuen Mun generated sales revenue of approximately HKD 69,700,000, completed during the review year[47]. - The property development project in Ap Lei Chau has a total site area of approximately 4,320 square feet, with construction work currently ongoing[49]. - The company plans to continue exploring suitable opportunities to expand its investment property portfolio to increase recurring and stable income[41]. - The remaining deferred payment from the sale of properties is approximately RMB 99,900,000, equivalent to about HKD 122,900,000, to be received after 12 months from the completion date[53]. Rental Income and Valuation - Total rental income for the year amounted to approximately RMB 400,000 (equivalent to about HKD 500,000) due to slow commercial activities and leasing progress impacted by the COVID-19 pandemic[27]. - The annual rental income from the hotel and resort villas in Xiamen is approximately RMB 18,800,000 (equivalent to about HKD 23,100,000)[36]. - The valuation of the property as of March 31, 2022, was approximately RMB 666,600,000 (equivalent to about HKD 820,500,000), with the commercial podium valued at RMB 261,300,000 and the twin towers at RMB 405,300,000[27]. - The valuation of the commercial property in Dongguan was RMB 36,400,000 (equivalent to about HKD 44,800,000) as of March 31, 2022, with annual rental income of approximately RMB 800,000 (equivalent to about HKD 1,000,000)[39]. - The occupancy rate of the Kuala Lumpur property dropped to approximately 54% due to the impact of COVID-19, with rental income of about RM 5,500,000 (equivalent to about HKD 10,200,000)[41]. Corporate Governance - The company has a new board diversity policy aimed at enhancing board effectiveness and maintaining high corporate governance standards[137]. - The nomination committee will report annually on the composition of the board in terms of diversity and monitor the implementation of the board diversity policy[137]. - The company emphasizes the importance of integrity, industry experience, and commitment when evaluating candidates for board positions[140]. - The company has a commitment to maintaining a balanced board in terms of skills, experience, and diverse perspectives to support business strategy execution[137]. - The board consists of 10 members, including the Chairman, Vice Chairman, and Managing Director[147]. Risk Management and Internal Controls - The board is responsible for maintaining an effective risk management and internal control system to safeguard the group's assets and shareholders' interests[171]. - The group has established a robust risk management process that includes risk identification, assessment, prioritization, treatment, monitoring, and reporting[174]. - The internal audit department reports directly to the audit committee and has conducted audits to address deficiencies in internal controls, with follow-up actions implemented[181]. - The board has reviewed the effectiveness and adequacy of the risk management and internal control systems through the audit committee, covering all significant controls[183]. Future Outlook and Strategy - The company plans to continue promoting remaining retail and parking spaces in its Tuen Mun property to generate rental income[22]. - The group aims to increase stable and recurring rental income by expanding its investment property portfolio[99]. - The group will explore opportunities in the Guangdong-Hong Kong-Macao Greater Bay Area and cities along the Belt and Road Initiative[99]. - The company has provided guidance for the next fiscal year, projecting revenue growth of A% and an expected EBITDA margin of B%[116]. - Future outlook remains positive, with management expressing confidence in achieving K% growth in the next quarter[116].
庄士中国(00298) - 2022 - 年度财报