Financial Performance - The rental income for the year ended December 31, 2022, was approximately HKD 24,600,000, a decrease of about 7% from HKD 26,500,000 in 2021[8] - The group's profit for the year decreased by approximately HKD 6,600,000 or 35% to about HKD 12,200,000, down from HKD 18,800,000 in 2021[9] - The group's revenue for the year ended December 31, 2022, was HKD 24,612,000, a decrease of 7.2% compared to HKD 26,532,000 in 2021[39] - Gross profit for the same period was HKD 19,960,000, down from HKD 21,510,000, reflecting a gross margin of 81.1%[39] - The net profit attributable to shareholders for the year was HKD 12,184,000, a decrease of 35.5% from HKD 18,807,000 in 2021[39] - Total comprehensive income for the year ended December 31, 2022, was HKD 12,621,000, up from HKD 18,666,000 in 2021, showing a decline of about 32.3%[157] - Basic and diluted earnings per share for 2022 were HKD 3.14, down from HKD 4.84 in 2021, representing a decrease of 35.1%[146] Financing and Borrowings - Financing costs increased over six times to approximately HKD 3,400,000 from HKD 400,000 in the previous year[9] - The total borrowings of the group as of December 31, 2022, were approximately HKD 307,900,000, compared to HKD 307,400,000 in 2021[16] - The debt-to-equity ratio was approximately 20.25% as of December 31, 2022, unchanged from the previous year[17] - The company’s interest expenses rose significantly to HKD 3,199,000 in 2022 from HKD 439,000 in 2021, marking an increase of over 627%[160] Assets and Liabilities - Total assets as of December 31, 2022, amounted to HKD 1,875,848,000, a slight increase from HKD 1,872,079,000 in 2021[40] - Total liabilities increased to HKD 355,621,000 from HKD 353,604,000 in the previous year[40] - Current liabilities totaled HKD 329,375,000, a marginal increase from HKD 328,056,000 in the previous year[151] - The company reported a net asset value of HKD 1,520,227,000, compared to HKD 1,518,475,000 in 2021, indicating a slight growth[151] Dividends - The company proposed a final dividend of HKD 0.012 per share, down from HKD 0.02 per share in 2021[37] - The company paid dividends totaling HKD 10,368,000 in 2022, compared to HKD 11,646,000 in 2021, which is a decrease of approximately 11%[160] Management and Strategy - The management anticipates a cautious approach to the financial performance for 2023 due to rising financing costs and weak demand in the local office and factory unit market[23] - The management is committed to ensuring the sustainability and competitiveness of its core business while seizing investment opportunities to create value for shareholders[23] - The company continues to focus on investment holding as its primary business strategy[36] Employee and Operational Expenses - The group employed approximately 6 staff members as of December 31, 2022, with employee expenses totaling about HKD 2,400,000, down from HKD 3,200,000 in 2021[21] - Operating and administrative expenses for the year were HKD 5,143,000, a decrease from HKD 6,111,000 in 2021[39] Environmental and Regulatory Compliance - The company has implemented various policies and measures to reduce its environmental impact, supporting sustainability efforts[42] - The company has not reported any major violations of applicable laws and regulations that significantly affect its business operations during the review year[43] Corporate Governance - The company’s board of directors includes a mix of executive and independent non-executive members, ensuring governance and oversight[55] - The company has maintained compliance with the corporate governance code as per the Hong Kong Stock Exchange regulations[81] - The board consists of two executive directors and three independent non-executive directors, ensuring a balanced composition[83] - The independent non-executive director, Mr. Xu, has served for over 12 years but his independence has not been compromised according to the board's assessment[87] Audit and Financial Reporting - The audit committee reviewed the consolidated financial statements for the year ended December 31, 2022, and recommended their approval to the board[101] - The company’s external auditor, KPMG, was recommended for reappointment at the upcoming annual general meeting[101] - The independent auditor's report confirmed that the consolidated financial statements reflect a true and fair view of the group's financial position as of December 31, 2022, in accordance with Hong Kong Financial Reporting Standards[129] Shareholder Communication - The company has established multiple communication channels with shareholders, including interim and annual reports, annual general meetings, and timely responses to shareholder inquiries[127] - Shareholders holding at least 10% of the paid-up capital can request a special general meeting, which must be convened by the board within 21 days of the request[121] - Shareholders can submit inquiries to the board through the company secretary at any time, facilitating communication between shareholders and the board[122] Investment Properties - The group reported an investment property carrying value of approximately HKD 1,698,420,000 as of December 31, 2022, with a net gain of approximately HKD 1,500,000 recognized in the consolidated income statement for the year[134] - The fair value change of investment properties for 2022 was HKD 1,500,000, significantly lower than HKD 5,100,000 in 2021[146] Accounting Policies - The financial statements are prepared in accordance with Hong Kong Financial Reporting Standards, with historical cost method applied except for investment properties and equity investments measured at fair value[167] - The company has adopted revised Hong Kong Financial Reporting Standards for the first time this year, which did not have a significant impact on the financial position and performance[174] - The group calculates the fair value of investment properties and listed equity investments at the end of each reporting period, based on market participant assumptions to maximize economic benefits[178]
东方兴业控股(00430) - 2022 - 年度财报