Financial Performance - For the year ended March 31, 2022, the Group's revenue was approximately HK$141.7 million, an increase of 32.8% from approximately HK$106.7 million in 2021[9] - The Group recorded a net loss of approximately HK$1.5 million for the year, significantly improved from a net loss of approximately HK$6.5 million in the previous year[10] - Gross profit for the year was approximately HK$39.6 million, an increase of approximately HK$0.6 million, or 1.5%, from approximately HK$39.0 million for the previous year[34] - The gross profit margin decreased to approximately 27.9% for the year, down from approximately 36.6% for the year ended 31 March 2021[34] - The Group recorded a net other gain of approximately HK$2.4 million for the Year, compared to a net other loss of approximately HK$3.7 million for the year ended 31 March 2021[38] - Selling and distribution expenses increased by approximately HK$1.1 million, or 17.5%, to approximately HK$7.4 million for the Year, primarily due to increased freight, transportation, and storage costs[44] - Administrative expenses decreased by approximately HK$0.8 million, or 2.2%, to approximately HK$35.8 million for the Year, mainly due to reduced staff costs and maintenance expenses[45] - The Group's revenue increased by approximately HK$35.0 million, or 32.8%, to approximately HK$141.7 million for the year, compared to approximately HK$106.7 million for the year ended 31 March 2021[25] Revenue Breakdown - Revenue from Hong Kong contributed approximately HK$128.9 million, accounting for about 91.0% of total revenue, compared to 93.1% in 2021[18] - Revenue from Macau increased to approximately HK$8.7 million, representing 6.1% of total revenue, up from 4.3% in 2021[19] - Revenue from the manufacturing and trading of DTH rockdrilling tools contributed approximately 82.1% of total revenue, down from approximately 89.0% in the previous year[23] - Revenue from trading of piling and drilling machineries accounted for approximately 7.1% of total revenue, up from approximately 2.6% in the previous year[24] - Revenue from trading of rockdrilling equipment accounted for approximately 10.8% of total revenue, up from approximately 8.3% in the previous year[24] Market Conditions - The improvement in the business environment in Hong Kong was attributed to a higher level of construction works and projects available during the year[9] - Increased competition in the Hong Kong market has exerted price pressure on products, leading to a decrease in gross profit margin[17] - The international market showed slight improvement, contributing positively to the Group's revenue as local and international customers increased their purchases[17] - The improvement in revenue was primarily due to a better business environment in Hong Kong, leading to increased construction activities[33] - The Group is cautiously optimistic about the future of the construction market in Hong Kong and internationally, aiming to capture business opportunities in Hong Kong, Macau, and overseas markets[53] Financial Position - As of 31 March 2022, the Group's total cash and cash equivalents amounted to approximately HK$64.6 million, a decrease from approximately HK$87.4 million as of 31 March 2021[56] - The gearing ratio as of 31 March 2022 was approximately 17.7%, down from approximately 18.7% as of 31 March 2021, primarily due to a decrease in lease liabilities[58] - The Group had no bank borrowings as of March 31, 2022, with other borrowings remaining at approximately HK$20.0 million[57] - The Group is comfortable with its current financial and liquidity position, maintaining a reasonable liquidity buffer[69] Corporate Governance - The Company focuses on maintaining high standards of corporate governance to enhance shareholder value and protect their interests[96] - The Board comprises two Executive Directors and three Independent Non-executive Directors, ensuring compliance with Listing Rules regarding board composition[104][105] - The Company has adopted the Model Code for Securities Transactions by Directors and confirmed compliance by all Directors throughout the year[103] - The Board is responsible for determining the operational plan and investment proposals of the Company, including the annual financial budget proposal[111] - The Company must notify the Stock Exchange at least seven working days before meetings where dividends or profit resolutions are discussed[117] Board and Committees - The Board held a total of 11 meetings during the year, with attendance rates for individual directors ranging from 64% to 100%[121] - The Audit and Compliance Committee held 4 meetings during the year, with a 100% attendance rate for all members[138] - The Remuneration Committee conducted 2 meetings during the year, with Ms. Lam Hoi Yu Nicki and Mr. Yiu To Wa achieving a 100% attendance rate[148] - The Nomination Committee consists of three members, all of whom are Independent Non-executive Directors, with Mr. Lau Leong Yuen serving as the chairman[154] - The Company has established three board committees: Audit and Compliance Committee, Remuneration Committee, and Nomination Committee, to delegate responsibilities effectively[132] Risk Management - The Group's risk management framework follows the COSO Enterprise Risk Management — Integrated Framework, allowing effective risk management[175] - The Group has identified principal risks classified into compliance risks, financial risks, operational risks, and strategic risks, with no significant risks identified in compliance and financial categories[180] - The Group adopts a "three lines of defence model" for corporate governance, with risk management monitoring conducted by the finance team and independent internal audit functions outsourced[189] - The risk management framework is evaluated at least annually, ensuring proactive management of identified risks[190] - The Group will continue to engage external independent professionals annually to review and enhance its internal control and risk management systems[191] Use of Proceeds - The net proceeds from the public offer were approximately HK$88.3 million, intended for various corporate purposes[77] - As of May 31, 2022, the Group had approximately HK$8.0 million of unutilized net proceeds, with allocations for overseas exhibitions and promotions, manpower increase, and office rental[78] - The unutilized net proceeds for overseas exhibitions and promotions were not utilized due to cancellations caused by the COVID-19 pandemic[85] - The Board resolved to reallocate approximately HK$8.0 million of unutilised net proceeds originally assigned for overseas exhibitions and promotions to fund working capital and other general corporate purposes[89] Employee and Remuneration - The Group had approximately 80 employees, a decrease from approximately 88 employees as of March 31, 2021[92] - The Group's remuneration policy is periodically reviewed, with employee benefits including discretionary bonuses and retirement plans for employees in Hong Kong and the PRC[92] - The performance evaluation standards for Directors and senior management are established by the Remuneration Committee to ensure accountability[144]
煜荣集团(01536) - 2022 - 年度财报