Financial Performance - The company's revenue increased by approximately 14.5% to about HKD 135.6 million for the year ended December 31, 2021, compared to HKD 118.5 million in 2020, primarily driven by the growth in the edible sugar segment [21]. - Gross profit decreased by approximately HKD 6.3 million to about HKD 21.9 million, with a gross margin reduction of about 7.6% to approximately 16.2% from 23.8% in 2020, attributed to production cost increases outpacing average selling price increases [21]. - The pre-tax loss decreased by approximately HKD 63.9 million to about HKD 57.3 million, down from HKD 121.2 million in 2020, mainly due to a reduction in fair value losses on biological assets and changes in operating income and expenses [22]. - Basic loss per share for the year was approximately HKD 1.51, compared to HKD 4.38 in 2020 [23]. - The company did not recommend a dividend for the year ended December 31, 2021, consistent with the previous year [24]. Revenue and Sales - The sugar production and processing business in Jamaica reported a revenue increase of approximately JMD 400 million to about JMD 2.6 billion (approximately HKD 135.6 million) from JMD 2.2 billion (approximately HKD 118.5 million) in 2020 [25]. - Sugar and molasses sales volumes increased by approximately 4.8% and 22.2%, respectively, due to a rise in sugarcane input of about 66,800 tons [28]. - Average selling prices for raw sugar and molasses increased by approximately 7.2% and 13.8%, respectively, driven by reduced local and international sugar supply [30]. - The revenue breakdown by region showed Jamaica contributing JMD 2,396.3 million (approximately HKD 123.6 million) or 91.2% of total revenue, while the USA contributed JMD 232.0 million (approximately HKD 12.0 million) or 8.8% [32]. - Local sales in Jamaica increased from approximately 88.1% to about 91.2%, while overseas sales decreased from approximately 11.9% to about 8.8% [34]. Production and Costs - The company processed approximately 259,200 tons of sugarcane to produce about 15,700 tons of raw sugar and about 14,600 tons of molasses in 2021, compared to 192,400 tons of sugarcane yielding about 11,200 tons of raw sugar and molasses in 2020 [29]. - The gross profit decreased by approximately 95,400,000 Jamaican dollars (about 6,300,000 HKD) to around 425,300,000 Jamaican dollars (about 21,900,000 HKD), with a gross margin reduction to about 16.2% from 23.8% [34]. - The average selling prices of raw sugar and molasses increased by approximately 7.2% and 13.8%, respectively, while production costs rose by approximately 24.0% and 27.3% [34]. - The cost of raw sugar production per ton was approximately 123,000 Jamaican dollars (about 6,300 HKD), and for molasses, it was approximately 16,900 Jamaican dollars (about 870 HKD) [34]. - The agricultural cost per hectare increased from approximately 248,000 Jamaican dollars (about 13,000 HKD) to about 317,000 Jamaican dollars (about 16,000 HKD), a rise of approximately 27.7% [34]. Losses and Fair Value - The net loss for the sugar segment was approximately 80,800,000 HKD, a decrease of about 2,600,000 HKD compared to the previous year [37]. - The fair value loss of biological assets decreased by approximately 15,800,000 HKD due to a 31.0% increase in sugarcane market prices [37]. Cash Flow and Borrowings - The company aims to maintain cash flow balance and achieve positive cash flow in 2022 by controlling customer risks and offering early payment discounts [47]. - The total borrowings of the group as of December 31, 2021, amounted to approximately HKD 1,094,200,000, an increase from HKD 1,072,100,000 in 2020 [53]. - The equity attributable to owners of the company showed a capital deficit of approximately HKD 815,500,000 as of December 31, 2021, compared to HKD 812,500,000 in 2020 [52]. - The bank deposits and cash balance increased to approximately HKD 81,200,000 as of December 31, 2021, up from HKD 63,500,000 in 2020 [56]. Corporate Governance - The board of directors emphasizes the importance of maintaining high standards of corporate governance to enhance shareholder value [146]. - The company has complied with the corporate governance code, with some deviations noted in specific clauses [147]. - The board consists of three executive directors, two non-executive directors, and three independent non-executive directors, bringing diverse expertise [158]. - The independent non-executive directors have confirmed their independence as per the listing rules [141]. - The company will seek to obtain insurance for directors and senior management in 2022 after not securing any offers in 2021 [147]. Employee Costs and Employment - The total employee cost for the group in the review year was approximately HKD 39,600,000, an increase from HKD 35,900,000 in the previous year, reflecting a rise of about 7.7% [70]. - Employee costs in the sugar business segment increased by approximately HKD 4,400,000 due to additional hiring to manage extended sugarcane crushing periods and increased maintenance work [70]. - The group employed 141 full-time employees and 527 temporary employees as of December 31, 2021, compared to 116 full-time and 422 temporary employees in the previous year [71]. Environmental and Compliance - The group has established multiple environmental protection policies aimed at reducing emissions and conserving energy [93]. - The group has no significant violations of applicable laws and regulations that would materially affect its business operations [94]. - The group invested in compliance procedures to ensure adherence to laws and regulations that significantly impact its operations [94]. Board Committees and Diversity - The nomination committee reviewed the board's structure, size, and diversity, confirming that the board possesses diverse skills and expertise [175]. - The nomination committee recommended the appointment of Liu Xueyi, Han Hong, and Shi Zhu as candidates for the company's annual general meeting [176]. - The board's diversity policy was adopted on March 27, 2014, and has been revised to include gender, age, skills, and experience as factors in candidate selection [190]. - The nomination committee has established measurable diversity goals for the board, including at least one qualified accountant and one director with relevant experience in the sugar industry [192].
华联国际(00969) - 2021 - 年度财报