Financial Performance - The Group recorded a loss of approximately HK$17.6 million for the period, a significant increase of 482.6% compared to a gain of approximately HK$4.6 million for the same period ended 31 December 2021, primarily due to increased finance and administrative costs [7][18]. - Revenue from advertising services decreased to approximately HK$58.2 million, down about 4.4% from HK$60.9 million in the same period last year, with no revenue generated from the sale of new energy electric vehicles during the review period [8][22]. - The Group's advertising revenue was negatively impacted by conservative marketing approaches from advertisers due to the COVID-19 pandemic and economic conditions [33]. - For the nine months ended 31 December 2022, the Group recorded a revenue decrease to approximately HK$58.2 million, representing a decline of about 4.4% compared to HK$60.9 million for the same period last year, primarily due to the advertising services business [29]. - Gross profit for the nine months ended December 31, 2022, was HK$9,397,000, compared to HK$23,514,000 in the same period of 2021, indicating a significant decline [142]. - The loss before income tax for the nine months ended December 31, 2022, was HK$17,570,000, compared to a profit of HK$4,628,000 in the same period of 2021 [142]. - The total comprehensive expense attributable to owners of the Company for the nine months ended December 31, 2022, was HK$21,689,000, compared to a profit of HK$4,979,000 in the same period of 2021 [142]. Administrative and Finance Costs - Administrative expenses increased substantially by approximately 100.9% to approximately HK$24.5 million, attributed to higher staff costs and expenses related to the acquisitions of Beijing Creative and Weishi New Energy [23]. - The Group's finance costs rose by approximately 76.9% to approximately HK$2.5 million, driven by an increase in borrowings from approximately HK$13.0 million as of 31 March 2022 to approximately HK$23.3 million as of 31 December 2022 [25]. - The increase in staff salaries and emoluments was approximately 13.5%, rising to approximately HK$5.9 million compared to HK$5.2 million for the nine months ended 31 December 2021 [23]. - The administrative expenses for the nine months ended December 31, 2022, were HK$24,504,000, compared to HK$12,195,000 in the same period of 2021, reflecting an increase [142]. Strategic Acquisitions and Business Focus - The strategic acquisition of a 51% stake in Beijing Creative in March 2022 aims to expand the Group's advertising business platform in Hong Kong and China, although market conditions have been challenging [18]. - The Group successfully acquired Hainan Weishi New Energy Technology Company Limited, focusing on the development of super fast-charging batteries, which aligns with the Group's strategy to shift towards renewable energy technology [21]. - The Group's strategic focus has shifted towards renewable energy technology, particularly through the acquisition of Weishi New Energy, which specializes in super-fast charging batteries [36]. - The Group is critically reviewing its new energy electric vehicle business model and is exploring new opportunities for developing auxiliary products and related renewable energy batteries [22]. Fundraising and Financial Management - On 28 December 2022, the Company proposed a rights issue to raise gross proceeds of up to approximately HK$51 million by issuing 509,485,435 rights shares at a subscription price of HK$0.10 per share [45]. - The maximum net proceeds from the Rights Issue are estimated to be approximately HK$48.5 million, with an estimated net subscription price per Rights Share of approximately HK$0.095 [63]. - Approximately 47% (or approximately HK$23 million) of the net proceeds will be used for debt repayment, 41% (or approximately HK$20 million) for the expansion and R&D of new battery technology, and 12% (or approximately HK$5.5 million) for general working capital [63]. - The actual net proceeds raised from the placing of 169,828,478 shares on 21 October 2022 was approximately HK$26 million, with specific allocations for debt repayment and working capital [54]. - As of 31 December 2022, the Group utilized HK$5.8 million for debt repayment and HK$19.8 million for general working capital from the net proceeds raised [54]. Market Conditions and Future Outlook - Following the relaxation of COVID-19 restrictions, the business environment in both the PRC and Hong Kong is expected to improve significantly in the second half of 2023 [70]. - The Group plans to enhance its marketing and advertising solutions to retain clientele in the PRC and Hong Kong as the advertising markets improve [71]. - The Group will cautiously assess market conditions for its new energy vehicle business and review its overall strategy for future contributions [71]. Corporate Governance and Compliance - The Audit Committee reviewed the unaudited third quarterly results for the nine months ended December 31, 2022, and confirmed compliance with applicable accounting standards and GEM Listing Rules [109][112]. - The Company has complied with all code provisions of the Corporate Governance Code, except for the requirement of providing at least 14 days' notice for regular board meetings due to practical reasons [121]. - The Company continued to adopt a code of conduct regarding Directors' securities transactions, which complies with the standards set out in GEM Listing Rules [122][125]. - The Company has no insurance cover for legal actions against Directors, as the Board believes the risk of litigation is relatively low [107]. Share Capital and Equity - The Company issued 169,828,478 new shares at a price of HK$0.16 per share on October 21, 2022 [132]. - The share consolidation was approved, with every 10 shares consolidated into 1 share effective from October 5, 2022 [160]. - As of December 31, 2022, the Group had approximately 35 employees, primarily located in the PRC and Hong Kong [175]. - As at 31 December 2022, a maximum of 71,414,239 shares, representing approximately 7% of the existing issued shares, are available for issuance [177].
嘉鼎国际集团(08153) - 2023 Q3 - 季度财报