Event Operations and Market Expansion - In 2021, the total number of marathon events significantly decreased, with fewer than 15 large-scale events successfully held due to the pandemic[9]. - The company faced losses from costs incurred for five major marathon events that were postponed or canceled during the year[9]. - The company actively expanded online events to meet participant demand and strengthen brand influence during the pandemic[10]. - The company collaborated with local governments to explore other sports events beyond marathons, including basketball and hiking, to capture new business opportunities[10]. - The company initiated online marathon events in October to December 2021, including Nanchang, Tumushuke, and Shenzhen marathons, while retaining rights for offline events[15]. - The company signed service agreements with Nanchang and Tumushuke cities to ensure its event rights and business interests were protected[15]. - The company has established a comprehensive cooperation with local governments in the southern Xinjiang region for sports cultural activities, including youth training and sports venue operations[16]. - The company aims to enhance industry integration by collaborating with other event operators and media units to reduce operational costs and expand revenue channels[16]. - The company believes that the normalization of the pandemic and successful hosting of the Winter Olympics will lead to a recovery and rapid development of the sports industry[13]. - The company is focused on improving its operational capabilities and professional standards to provide better products and services to sports consumers[13]. - The company has successfully operated over 200 large-scale city marathon events, becoming the largest industry operator in China and globally[144]. Financial Performance - The group's revenue increased by approximately 37.1% from RMB 8.9 million for the year ended December 31, 2020, to RMB 12.2 million for the year ended December 31, 2021[21]. - The revenue from the event operation and marketing segment rose by 120.0% to RMB 9.1 million, while the sports services segment revenue decreased by approximately 62.2% to RMB 3.1 million due to the sale of a subsidiary[21]. - The group's service costs increased by approximately 33.3% from RMB 9.3 million to RMB 12.4 million, with the event operation and marketing segment's costs rising to RMB 12.2 million[24]. - The gross loss decreased by approximately 50.0% to RMB 0.2 million, with a gross loss margin of about 1.6% for the year ended December 31, 2021[25]. - Other income increased by approximately 9.0% to RMB 19.4 million, primarily due to interest income from financial assets triggering redemption clauses[28]. - The group's net loss attributable to owners increased by 1.8% to RMB 47.8 million for the year ended December 31, 2021[33]. - Cash and cash equivalents were approximately RMB 127.4 million as of December 31, 2021, down from RMB 137.7 million a year earlier[34]. - The group's current assets decreased by approximately 8.2% to RMB 293.5 million, while maintaining sufficient working capital for daily operations[35]. - Capital expenditures for property, plant, and equipment totaled RMB 1.2 million, significantly down from RMB 58.5 million in the previous year[36]. Risk Management and Compliance - The company aims to identify, assess, and manage all existing and future significant risks to maintain them within acceptable levels[110]. - The company has implemented a risk management framework that includes risk identification, assessment, management measures, and monitoring[111]. - The operational risk related to the COVID-19 pandemic has significantly impacted the company's main business of event operations and marketing[114]. - The company is cautious in expanding new business areas, avoiding large upfront investments without thorough market research[114]. - The company has established a risk monitoring mechanism to ensure compliance with external regulations and internal policies[110]. - The company reported a stable trend in operational risks, while new business expansion risks are increasing[114]. - The internal audit function is responsible for coordinating risk identification and assessment procedures[108]. - The company aims to enhance financial performance by diversifying its revenue sources through low-risk financial and investment strategies[114]. - The board is responsible for evaluating and determining the major risks annually and monitoring the effectiveness of risk management systems[108]. - The company has implemented a risk management and internal control system that is deemed effective and sufficient as of December 31, 2021, with no significant issues affecting financial monitoring or compliance identified[119]. Corporate Governance - The board of directors held four meetings during the year ended December 31, 2021[68]. - The company has adopted the standard code for securities transactions as per Listing Rule Appendix 10, confirming compliance by all directors for the year ended December 31, 2021[65]. - The remuneration range for directors and senior management members was between 0 to HKD 1,000,000 for the year ended December 31, 2021[84]. - The company has received annual written confirmations regarding the independence of independent non-executive directors as per Listing Rule 3.13[70]. - All independent non-executive directors have confirmed their independence and have no significant connections with other directors[70]. - The company has implemented a continuous professional development program for all directors, ensuring they stay updated on their responsibilities and the company's operations[79]. - The board believes that high standards of corporate governance are essential for the company's business strategy and transparency[63]. - The company has complied with the corporate governance code throughout the year ended December 31, 2021[64]. - The board is collectively responsible for the company's business strategies and performance, ensuring objective decisions are made in the company's best interest[75]. - The Audit Committee held two meetings in the year ended December 31, 2021, to review the annual financial performance and reports for the year ended December 31, 2020, and the interim financial performance for the six months ended June 30, 2021[87]. - The Remuneration Committee conducted three meetings in the year ended December 31, 2021, to review the company's remuneration policies and structures, as well as the remuneration of executive directors and senior management[91]. - The Nomination Committee held two meetings in the year ended December 31, 2021, to review the board's structure, composition, and the independence of independent non-executive directors[93]. - The company has adopted a board diversity policy aimed at maintaining a balanced and diverse board composition to achieve strategic goals and sustainable development[98]. - The Audit Committee's main responsibilities include independent review of the financial reporting process, internal controls, and risk management systems[86]. - The company has established a director nomination policy to ensure that board members possess the necessary skills, experience, and diverse perspectives[96]. - The Remuneration Committee is responsible for evaluating the performance of executive directors and approving the terms of their service contracts[91]. - The company aims to recruit a diverse range of talents and maintain a board with diverse perspectives[98]. - The Nomination Committee will review the board diversity policy periodically to ensure its effectiveness[102]. - The Audit Committee also met with external auditors twice during the year ended December 31, 2021[89]. - The board members attended all scheduled meetings, with attendance rates of 100% for the board and various committees[104]. Environmental, Social, and Governance (ESG) Initiatives - The board of directors is responsible for overseeing the company's environmental, social, and governance (ESG) issues and processes[155]. - The company has established clear short-term and long-term sustainable development visions and goals to achieve continuous emission reduction[155]. - The ESG report is based on four reporting principles: materiality, quantification, balance, and consistency[149]. - The company has adopted a dividend policy to maintain sufficient cash reserves for funding needs and future growth[138]. - The board will consider financial performance, cash flow, and other factors when declaring dividends[138]. - The company has no predetermined dividend payout ratio at present[140]. - The company encourages stakeholders to provide feedback on its ESG policies and performance[152]. - The company aims to reduce air emissions by 1% by 2025, 2% by 2027, and 3% by 2030 compared to the 2019 baseline[169]. - Energy consumption is targeted to decrease by 1% by 2025, 2% by 2027, and 3% by 2030, measured in million watt-hours[169]. - Water usage is expected to be reduced by 1% by 2025, 3% by 2027, and 5% by 2030, measured in approximate tons[169]. - Waste management is set to decrease by 1% by 2025, 3% by 2027, and 5% by 2030[169]. - The company emphasizes stakeholder engagement and regularly consults with internal and external stakeholders regarding operational and performance aspects[159]. - Key ESG issues identified include customer satisfaction, service safety, and business ethics[167]. - The company is committed to monitoring ESG performance and maintaining close communication with stakeholders for effective risk management[167]. - The company plans to establish an ESG working group or committee as necessary to prepare for future business challenges[168]. - The company strictly adheres to environmental laws in China, ensuring operations do not pose significant environmental threats[172]. - The company will track water and packaging material usage during marathon events and comply with environmental impact assessments conducted by the government[172]. - The group did not consume any gas fuel during the reporting period, resulting in no direct emissions of nitrogen oxides (NOx), sulfur oxides (SOx), or particulate matter (PM)[175]. - The total greenhouse gas (GHG) emissions for 2021 amounted to 55.83 tons of CO2 equivalent, a 103% increase from 27.43 tons in 2020, but a 34% decrease compared to 190.95 tons in 2019[176][184]. - Business travel was identified as the main source of GHG emissions, with a 274% increase in direct GHG emissions due to increased vehicle usage for marathon event preparations compared to 2020[184]. - The group disposed of a total of 0.09 tons of waste paper in 2021, a decrease from 0.15 tons in 2020 and 0.736 tons in 2019, attributed to reduced business activities during the pandemic[186][187]. - The group has implemented measures to reduce emissions, including encouraging employees to use public transportation instead of private cars and promoting the use of teleconferencing for meetings[189]. - The group plans to continue monitoring vehicle usage and optimizing data collection systems to manage emissions effectively[175]. - The group has adopted an office automation system to promote paperless operations and encourages double-sided printing and recycling of paper[192]. - The group aims to utilize new technologies and eco-friendly materials in future marathon events to minimize environmental impact[192]. - The group reported no significant incidents of non-compliance with applicable laws regarding air pollutants and greenhouse gas emissions during the reporting period[175]. - The group will continue to assess the necessity of business travel to control GHG emissions[184]. - Total energy consumption in 2021 was 93,478 kWh, a significant decrease from 143,493 kWh in 2019, reflecting a reduction of approximately 34.8%[194]. - Gasoline consumption in 2021 was 85,256 kWh, compared to 101,617 kWh in 2019, indicating a decline of about 16.1%[194]. - Office electricity intensity in 2021 was 8.7 kWh per square meter, an increase from 6.8 kWh per square meter in 2020[197]. - The total office area in 2021 was 944.42 square meters, down from 1,339.09 square meters in 2020[197]. - There were no marathon events held in 2021, compared to 12 events in 2019, impacting energy metrics related to events[196].
中国前沿科技集团(01661) - 2021 - 年度财报