Financial Performance - The gross profit margin for FY2022 decreased significantly to approximately 1.1% due to high building material costs and the impacts of COVID-19[10]. - The Group's revenue increased by approximately HK$3.2 million or 1.5% from approximately HK$220.8 million in FY2021 to approximately HK$224.0 million in FY2022, primarily due to three high-value façade projects starting during the year[20]. - Gross profit decreased from approximately HK$50.4 million in FY2021 to approximately HK$2.5 million in FY2022, with the gross profit margin dropping from approximately 22.8% to 1.1%[26]. - The decline in gross profit margin was attributed to increased project overhead and subcontracting costs, a surge in building material prices, and additional costs incurred for expediting project completion due to COVID-19 impacts[26]. - The net loss for FY2022 amounted to approximately HK$22.7 million, compared to a net profit of approximately HK$21.7 million in the previous year[46]. - Total gross profit for FY2022 was approximately HK$2.5 million, significantly lower than approximately HK$50.4 million in FY2021, reflecting the overall decline in project profitability[31]. Project Backlog and Opportunities - The outstanding value of projects on hand decreased to approximately HK$355.4 million from approximately HK$569.2 million as of March 31, 2021[11]. - Despite the decline, the backlog remains relatively high compared to prior years, indicating potential for new projects with reasonable profit margins in the coming year[12]. - The company will periodically review its backlog and proactively seek opportunities for business expansion[12]. - The company maintains a prudent approach to bidding on new projects amid ongoing challenges in the global market[11]. Market Conditions and Challenges - The ongoing impact of COVID-19 continues to challenge the industry, with property developers enforcing strict cost controls and fierce competition persisting in the façade and metal finishing markets[17]. - The Group expects to face higher building material and overhead costs for a certain period, despite a decrease in COVID-19 infection cases[17]. - The industry is anticipated to gradually recover as residential and commercial development projects in Hong Kong resume momentum[10]. Cost Control Measures - The company has implemented control measures to mitigate the impacts of high material costs and expects improvement in gross profit margin as material prices stabilize[10]. - The Group has implemented control measures to mitigate the impact of high building material costs and overheads, while maintaining sufficient financial resources to adapt to market changes[17]. - The company has implemented tight cost control measures, adjusting project staff based on workload and project completion dates[66]. Employee and Management Information - As of March 31, 2022, the Group had 54 full-time employees, a decrease from 64 employees as of March 31, 2021, primarily due to a reduction in project staff[66]. - Total staff costs for FY2022 were approximately HK$34.7 million, compared to approximately HK$32.3 million in FY2021, reflecting a year-over-year increase[66]. - The Group's employee remuneration package includes salary, discretionary bonuses, and cash subsidies to attract and retain skilled labor[118]. - The Group's senior management includes individuals with extensive experience in their respective fields, such as over 35 years in purchasing and logistics management[78]. Corporate Governance - The company has a strong governance structure with independent non-executive directors serving on key committees such as the Audit Committee and Remuneration Committee[72]. - The management team is well-qualified, with members holding advanced degrees in business administration and accounting from reputable institutions[74]. - The company emphasizes the importance of experienced leadership in driving strategic initiatives and ensuring compliance with financial regulations[70]. - The Board consists of five Directors, including two executive Directors and three independent non-executive Directors, ensuring a balance of skills and experience[138]. Financial Position and Assets - As of March 31, 2022, the Group had net current assets of approximately HK$118.0 million, a decrease from approximately HK$163.9 million as of March 31, 2021, resulting in a current ratio of approximately 4.0 times compared to 6.8 times in the previous year[51]. - The Group's bank balances and cash decreased to approximately HK$46.1 million as of March 31, 2022, down from approximately HK$72.9 million as of March 31, 2021[51]. - The gearing ratio increased to approximately 16.1% as of March 31, 2022, compared to approximately 2.8% as of March 31, 2021, primarily due to increased bank borrowings and a decrease in total equity from net loss[51]. Dividend Policy - The company does not recommend the payment of a final dividend for the Year, compared to a final dividend of HK$20.0 million (equivalent to HK$0.01 per share) in 2021[85]. - The Company has established a Dividend Policy aimed at balancing sufficient capital maintenance for business development and rewarding shareholders[169]. - The Board will consider operational results, cash flows, financial condition, and future business prospects when proposing dividends[170]. Audit and Compliance - The Company's audited consolidated financial statements for the Year were reviewed by the Audit Committee on June 28, 2022, and were found to comply with applicable accounting standards[134]. - Deloitte Touche Tohmatsu acted as the auditor for the Group for the Year and will offer itself for re-appointment at the forthcoming AGM[134]. - The Audit Committee has been established to oversee financial reporting, internal control, and risk management systems[179]. - The board acknowledges the importance of ongoing training and professional development for directors and senior management[198].
智中国际(06063) - 2022 - 年度财报