Financial Performance - The Group recorded a turnover of approximately RMB7,902 million for the year ended 31 March 2022, representing an increase of 9.9% compared to RMB7,189 million in 2021[7]. - Profit after tax for the Group was approximately RMB96 million, up from approximately RMB52 million in the previous year[7]. - Revenue from LNG sales was approximately RMB1,631 million, an increase of 39.1% compared to the previous year, contributing approximately 20.6% of the total turnover[20]. - Gross profit from LNG sales increased to approximately RMB204 million, although the gross profit margin slightly decreased from 13.9% to 12.5%[20]. - Revenue from piped gas sales increased to approximately RMB662 million, a rise of 34.3% from RMB493 million, contributing about 8.4% to total turnover[25]. - Oil and gas sales contracts gross amounts rose to approximately RMB5,528 million, an increase of 2% from RMB5,418 million, accounting for approximately 70% of total turnover[26]. - Gross profit margin for oil and gas sales improved slightly from 1.2% to 1.3%, with gross profit increasing to approximately RMB74 million from RMB68 million[26]. - Total turnover for the year ended 31 March 2022 was approximately RMB7,902 million, up from RMB7,189 million, primarily driven by LNG production and sales which generated approximately RMB1,631 million[35]. - Gross profit for the year was approximately RMB302 million, a slight decrease from RMB303 million, with gross profit margin declining from 4.2% to 3.8%[36]. Business Strategy and Market Outlook - The Group aims to optimize cost and business structures while exploring LNG distribution channels through collaborations with industry players and state-owned enterprises[9]. - The management is cautious about the ongoing uncertainties in the oil and gas market and plans to implement strategies to mitigate adverse impacts on the business[13]. - The Group is focused on developing its natural gas business and exploring new business opportunities to create value for shareholders[13]. - The increasing demand for natural gas is driven by China's "Dual Carbon" goals, which aim for carbon emission peak by 2030 and carbon neutrality by 2060[8]. - The Group anticipates steady growth in natural gas demand due to government policies promoting clean production and pollution control[29]. - The Group's performance is primarily attributed to the production and sales of LNG, which is expected to remain a dominant energy source in the market[19]. Financial Position and Capital Management - As of March 31, 2022, the Group maintained bank balances and cash of approximately RMB 123 million, an increase from approximately RMB 46 million in 2021[49]. - The net current assets of the Group were approximately RMB 796 million as of March 31, 2022, compared to approximately RMB 799 million in 2021, with a current ratio of approximately 1.43[49]. - The Group's borrowings amounted to approximately RMB 885 million due within one year and approximately RMB 57 million repayable after one year, resulting in a gearing ratio of approximately 0.74, down from 0.85 in 2021[49]. - Capital expenditure for property, plant, and equipment increased to approximately RMB33 million from RMB16 million[48]. - Finance costs decreased by approximately 19.6% to RMB78 million from RMB97 million, attributed to reduced bank borrowings[46]. - Other income decreased by approximately 74.2% to RMB3 million from RMB12 million, mainly due to a reduction in average pledged bank deposits[37]. Corporate Governance and Board Structure - The Board held six meetings during the year, with attendance rates of 5/6 for Mr. Wang Jianqing, 5/5 for Mr. Bao Jun, and 2/2 for Mr. Zhou Jian before his resignation[76]. - All independent non-executive directors confirmed their independence annually as per Rule 3.13 of the Listing Rules, and the Company considers them to be independent[80]. - The Company has a policy of re-election for all directors, including independent non-executive directors, at least once every three years[81]. - The roles of chairman and CEO are held by Mr. Wang Jianqing, who has been in these positions since January 2011 and September 2011 respectively[94]. - The Company has established sound internal control and risk management systems overseen by the Board[79]. - The Board is responsible for the strategic decisions and financial performance of the Group, delegating day-to-day management to the management team[79]. - The Company maintains detailed minutes of Board meetings, which are circulated for comments before approval[77]. - The independence of directors is assessed regularly, ensuring compliance with the independence guidelines set out in the Listing Rules[84]. - The Company has decided to maintain existing Bye-laws regarding director appointments despite inconsistencies with the Listing Rules[90]. - The Board believes Mr. Wang has essential leadership skills and extensive knowledge of the Group's business, making the current structure suitable for effective strategy formulation and implementation[101]. Remuneration and Director Development - The Remuneration Committee (RC) consists of three independent non-executive directors, ensuring proper governance and oversight of remuneration policies[100]. - The RC held one meeting during the year ended March 31, 2022, to discuss and approve the remuneration for directors and management[110]. - The RC is responsible for formulating remuneration policies considering factors such as salaries from comparable companies and individual performance[106]. - The RC has the authority to engage external professional advisors for assistance on remuneration issues if necessary[107]. - The RC aims to ensure that no director is involved in deciding their own remuneration, maintaining fairness and transparency[107]. - The RC is reviewing the remuneration policy for directors and senior management to ensure it aligns with corporate goals[108]. - Directors are required to participate in continuous professional development to stay informed about their responsibilities and the Group's business activities[102]. Risk Management and Internal Controls - The Audit Committee comprises three independent non-executive directors, ensuring oversight of external auditor appointments and remuneration[111]. - The Committee is responsible for reviewing the adequacy of internal controls, risk management systems, and financial reporting integrity[113]. - Significant financial reporting judgments and compliance with accounting standards are monitored by the Committee[113]. - The Company aims to ensure effective risk management and internal control systems, including adequate resources and staff qualifications[114]. - The external auditor's independence and effectiveness are evaluated annually, including their access to necessary records and data[116]. - The Committee reviews the Group's financial and accounting policies and practices to ensure compliance and effectiveness[114]. - Arrangements are in place for employees to confidentially raise concerns about financial reporting and internal control issues[116]. - The Company is committed to timely responses to issues raised in the external auditor's management letter[114]. - The Committee discusses any significant recommendations from the external auditors to enhance financial reporting processes[116]. - The Company emphasizes the importance of maintaining independence in the audit process, including rotation of audit partners and staff[116]. - The Audit Committee (AC) held two meetings during the year ended March 31, 2022, with full attendance from all members[123]. - The AC reviewed the Company's annual report for the year ended March 31, 2022, and the interim report for the six months ended September 30, 2021[127]. - The AC assessed the external auditor's remuneration and terms of engagement, including the audit plan[125]. Board Diversity and Composition - The Nomination Committee (NC) is composed of the chairman and two independent non-executive directors[126]. - The NC is responsible for reviewing the structure, size, and composition of the Board at least annually[129]. - The Company has established a Board Diversity Policy to enhance performance quality through diverse Board composition[136]. - The NC monitors the implementation of the Board Diversity Policy and recommends revisions as necessary[137]. - The Company considers diversity in Board composition from various aspects, including gender and professional experience[136]. - The Nomination Committee held one meeting during the year ended March 31, 2022, to discuss the structure, size, and composition of the Board[138]. Shareholder Communication and Engagement - The Group maintains ongoing communication with shareholders and investors through financial reports and general meetings[159]. - The Company maintains a website for communication with shareholders and investors, providing contact details for inquiries[166]. - Independent non-executive directors are encouraged to attend general meetings to understand shareholders' views better[165]. - The Company ensures that disclosed information is accurate and not misleading, maintaining confidentiality until public disclosure is feasible[161]. - The Company has established procedures for shareholders to propose resolutions and circulate statements at general meetings[173]. - Shareholders holding at least one-tenth of the paid-up capital can requisition a special general meeting within two months[172]. Leadership and Experience - Mr. Wang Jianqing has extensive experience in the energy and trading industry, previously serving as chairman and executive director of Fresh Express Delivery Holdings Group Co., Ltd. until September 2014[181]. - Mr. Bao Jun has over 20 years of experience in project investment, construction, and operation management, contributing to various biological and chemical engineering projects[182]. - Dr. Leung Hoi Ming has extensive knowledge in risk management of financial instruments and served as Senior Vice President in the Treasury and Markets Division at DBS Bank[184]. - Mr. Wong Chi Keung holds a Master's degree in Business Administration and has over 40 years of experience in finance, accounting, and management[194][200]. - The company has a strong board of directors with diverse backgrounds in finance, engineering, and management, enhancing its strategic decision-making capabilities[190]. - The independent non-executive directors bring significant industry experience, which is crucial for corporate governance and oversight[193]. - The company is focused on expanding its market presence and enhancing operational efficiency through strategic leadership[190]. - The board's composition reflects a commitment to maintaining high standards of corporate governance and risk management practices[191]. - The directors' extensive networks and experience in their respective fields are expected to drive future growth and innovation for the company[182][184]. - The company is well-positioned to leverage its leadership team's expertise in navigating market challenges and pursuing new opportunities[190].
元亨燃气(00332) - 2022 - 年度财报