Financial Performance - The company reported a 14.3% decrease in net profit attributable to shareholders, amounting to approximately HKD 45.1 million for the year ended July 31, 2022, compared to HKD 52.6 million for the previous year[26]. - Earnings per share for the year ended July 31, 2022, were HKD 5.26, reflecting a 14.3% decline from HKD 5.26 in the prior year[26]. - The company reported a profit attributable to shareholders of approximately HKD 45.1 million for the year ended July 31, 2022, a decrease of about 14.3% from HKD 52.6 million for the previous year[35]. - Total revenue for the year ended July 31, 2022, was approximately HKD 395.2 million, a decrease of about HKD 90.6 million or 18.7% compared to HKD 485.8 million for the previous year[41]. - Revenue from the sale of heavy equipment and parts decreased from approximately HKD 257.2 million to about HKD 187.5 million, a decline of approximately HKD 69.7 million or 27.1%[42]. - Revenue from heavy equipment leasing decreased from approximately HKD 217.1 million to about HKD 197.0 million, a decline of approximately HKD 20.1 million or 9.3%[46]. - Revenue from maintenance and support services decreased from approximately HKD 11.5 million for the year ended July 31, 2021, to approximately HKD 10.7 million for the year ended July 31, 2022, a decline of about HKD 0.8 million or 7.0% due to a slowdown in repair services during the year[47]. - Gross profit decreased from approximately HKD 90.6 million for the year ended July 31, 2021, to approximately HKD 87.0 million for the year ended July 31, 2022, a decline of about 4.0%, while the gross profit margin increased to approximately 22.0% from 18.6%[49]. - Other income and net gains decreased from approximately HKD 9.3 million for the year ended July 31, 2021, to approximately HKD 7.2 million for the year ended July 31, 2022, a decline of about 22.6% mainly due to a reduction in government subsidies[54]. - Financing costs decreased by approximately 52.6% from about HKD 1.9 million for the year ended July 31, 2021, to approximately HKD 0.9 million for the year ended July 31, 2022, consistent with a reduction in average bank borrowings[57]. - The total employee cost for the year ended July 31, 2022, was approximately HKD 100.0 million, down from HKD 116.5 million in the previous year[160]. - The group employed 180 full-time employees as of July 31, 2022, a decrease from 215 employees a year earlier[160]. Dividends - The board proposed a final dividend of HKD 0.01 per share, bringing the total cash dividend for the year to HKD 0.02 per share, down from HKD 0.035 per share in the previous year[26]. - The proposed final dividend is HKD 0.01 per ordinary share, with a total cash dividend of HKD 0.02 per ordinary share for the year ended July 31, 2022, compared to HKD 0.035 for the previous year[62]. - The company reported a total cash dividend of HKD 2.0 per share for the year ended July 31, 2022, down from HKD 3.5 per share in the previous year[106]. Business Operations and Strategy - The company continues to provide "one-stop service" for earthmoving equipment users and employs flexible fleet management strategies for its leasing business[26]. - Advanced technologies are being utilized in the company's earthmoving equipment to enhance safety, productivity, and asset management[26]. - The company has become the exclusive distributor for Xwatch brand safety and control systems and an authorized distributor for the Mobile360 system, enhancing its product offerings[30]. - The company remains cautiously optimistic about the heavy equipment sales and leasing market, anticipating strong demand due to government infrastructure investments exceeding HKD 100 billion annually in the coming years[36]. - The company plans to continue expanding its supplier base and product offerings to enhance sustainability, productivity, and competitiveness[31]. - The company is committed to exploring new business opportunities and maintaining growth despite ongoing challenges[31]. Acquisitions - The company acquired 100% equity of Orange Fortune Limited for a cash consideration of HKD 22,000,000 during the fiscal year ending July 31, 2022[72]. - The acquisition of Orange Fortune Limited was recorded as an asset purchase rather than a business acquisition, thus no goodwill or bargain purchase gain was recognized[75]. - The acquisition aims to expand the company's operations by utilizing more space for fleet parking, maintenance, and increasing inventory of equipment and spare parts[164]. - The target company's properties are located near the company's main operational sites, facilitating management and reducing employee commuting time[164]. - The acquisition was approved at a special general meeting on February 8, 2022, and completed on February 28, 2022[166]. Financial Position - As of July 31, 2022, the current ratio was approximately 5.6 times, down from 6.1 times a year earlier, with total bank and cash balances of approximately HKD 87.2 million[63]. - The debt-to-equity ratio as of July 31, 2022, was approximately 7.4%, down from 8.9% a year earlier, indicating a stable financial condition[63]. - The company had no significant contingent liabilities or asset pledges as of July 31, 2022, maintaining a clean balance sheet[68][69]. - As of July 31, 2022, the company's issued share capital was HKD 10,000,000, with a total of 1,000,000,000 ordinary shares issued at a par value of HKD 0.01 each[70]. - As of July 31, 2022, the company has distributable reserves of approximately HKD 95.7 million, compared to HKD 99.3 million as of July 31, 2021[140]. Corporate Governance - The board presented its report and audited consolidated financial statements for the year ended July 31, 2022[103]. - The board consists of a chairman and CEO, three executive directors, and three independent non-executive directors[141]. - Independent non-executive directors have confirmed their independence according to the listing rules[146]. - The board has established a nomination policy to ensure a structured process for selecting and re-electing directors[195]. - The company emphasizes the importance of board diversity, implementing measurable goals to enhance board effectiveness[196]. - Each director has undergone formal training to ensure they are well-informed about the company's operations and regulatory responsibilities[187]. - The company has adopted a standard code of conduct for securities trading, which all directors have confirmed to comply with[185]. - The board's composition and skills are regularly reviewed to ensure alignment with the company's business needs and shareholder structure[195]. - The company encourages ongoing professional development for all directors to enhance their knowledge and skills[187]. - The board held five meetings during the fiscal year ending July 31, 2022, with all directors attending all meetings[199]. - The roles of Chairman and CEO are not separated, with Mr. Zhou serving in both capacities since the company's establishment in 2001, which is believed to benefit the group's operations and management[200]. Market Conditions - The impact of the COVID-19 pandemic on the local economy remains uncertain, but the company is monitoring the situation closely[36]. - The company has experienced over 7 years of sales and service support management experience in the heavy equipment industry[100]. - The company has a strong focus on after-sales service and parts sales, with Li Shun-An overseeing these operations since 2014[101]. Compliance and Regulations - The company maintained compliance with relevant laws and regulations during the year ended July 31, 2022[114]. - The company has established safety, quality, and environmental management systems to meet customer requirements[113]. - The company has maintained compliance with listing rules, ensuring at least three independent non-executive directors, constituting at least one-third of the board[183]. - The board believes that the company has complied with the disclosure requirements under the Listing Rules[166]. - The company has not changed its independent auditor in the past three years[174]. - No significant events affecting the group have occurred after the fiscal year ending July 31, 2022, up to the report date[175].
德利机械(02102) - 2022 - 年度财报