菊福堂生物(08217) - 2023 - 中期财报

Company Information Company Information Overview This chapter provides basic company information for Luen Wong Group Holdings Limited, including board members, committee compositions, registered office, principal place of business, share registrar, auditor, and principal bankers, confirming the company's stock code is 8217 - Board members include Executive Directors Ms. Lau Wing Yu, Ms. Yu Hiu, and Independent Non-executive Directors Mr. Liu Hung Ho, Ms. Lau Yin Kam, Mr. Wong Chi Kam[6] - Audit Committee, Remuneration Committee, and Nomination Committee have been established, with Independent Non-executive Directors serving as chairmen[6] - The company's stock code is 8217, listed on GEM of The Stock Exchange of Hong Kong Limited[7] Management Discussion and Analysis Business Review and Prospects The Group has over 22 years of civil engineering experience in Hong Kong, but revenue decreased for the six months ended September 30, 2022, due to project completion and COVID-19; management remains confident, planning to enhance competitiveness, control costs, and explore business opportunities in Japan and Thailand - The Group primarily provides civil engineering services in Hong Kong, including road and drainage, structural, and site formation works[9] - Revenue for the six months ended September 30, 2022, decreased compared to the same period last year, mainly due to certain large construction projects nearing completion and COVID-19 outbreak impacting project progress[9] - Looking ahead, the Group will continue to strengthen its competitive advantages, prudently evaluate projects, control overall costs, and assess the feasibility of obtaining necessary licenses for civil engineering and related operations in other countries like Japan and Thailand[10] Principal Investments As of September 30, 2022, the Group's principal investments in financial assets at fair value through profit or loss totaled HKD 49,601 thousand, representing 40% of total assets, with an investment in Wellong Holdings Limited accounting for 28%; the Group will maintain a diversified portfolio and closely monitor market trends Principal Investments Overview (As of September 30, 2022) | Principal Investments in Financial Assets at FVTPL | Fair Value as of September 30, 2022 (HKD thousands) | Approximate Percentage of Total Assets | | :--------------------------------- | :----------------------------------- | :------------------- | | Wellong Holdings Limited | 34,731 | 28% | | Other Listed Equity Securities | 14,870 | 12% | | Total | 49,601 | 40% | - Wellong Holdings Limited is primarily engaged in construction and building engineering, money lending, securities investment, and asset management businesses[12] - The Group will continue to maintain a diversified investment portfolio and closely monitor its investment performance and market trends to adjust its investment strategy[13] Financial Review The Group's financial performance for the six months ended September 30, 2022, showed decreased revenue and a shift from gross profit to gross loss, but a significant improvement in loss for the period due to a substantial increase in other income and reduced administrative expenses Revenue The Group's revenue, entirely from civil engineering services, decreased by 23.5% from HKD 49,403 thousand to HKD 37,787 thousand for the six months ended September 30, 2022, primarily due to large projects nearing completion and COVID-19 impacts Revenue Comparison (HKD thousands) | Metric | For the six months ended September 30, 2022 | For the six months ended September 30, 2021 | Change Amount | Change (%) | | :--- | :------------------------- | :------------------------- | :------- | :----- | | Revenue | 37,787 | 49,403 | (11,616) | (23.5%)| - Revenue decrease was mainly due to certain large construction projects nearing completion and COVID-19 outbreak affecting project progress[14] Gross Profit and Gross Margin The Group's performance shifted from a gross profit of HKD 1,610 thousand in the prior period to a gross loss of HKD 4,143 thousand for the six months ended September 30, 2022, indicating a significant deterioration in profitability Gross Profit/(Loss) Comparison (HKD thousands) | Metric | For the six months ended September 30, 2022 | For the six months ended September 30, 2021 | Change Amount | | :--- | :------------------------- | :------------------------- | :------- | | Gross Profit/(Loss) | (4,143) | 1,610 | (5,753) | - Gross profit margins vary significantly across projects, primarily attributable to the cost-plus pricing model[16] Other Income/(Loss) The Group's other income significantly increased by 137.5% from HKD 6,373 thousand to HKD 15,137 thousand, primarily driven by increased unrealized gains from listed securities investments, higher severance payment refunds, and increased government subsidies Other Income/(Loss) Comparison (HKD thousands) | Metric | For the six months ended September 30, 2022 | For the six months ended September 30, 2021 | Change Amount | Change (%) | | :--- | :------------------------- | :------------------------- | :------- | :----- | | Other Income/(Loss) | 15,137 | 6,373 | 8,764 | 137.5% | - The increase was mainly due to increased unrealized gains from investments in listed securities, increased refunds of severance payments, and increased subsidies received under the Employment Support Scheme launched by the HKSAR Government[17] Administrative Expenses Administrative expenses decreased by 14.7% to HKD 10,642 thousand, primarily due to reduced professional fees and no share-based payments recognized during the period, partially offset by an increase in expected credit losses Administrative Expenses Comparison (HKD thousands) | Metric | For the six months ended September 30, 2022 | For the six months ended September 30, 2021 | Change Amount | Change (%) | | :--- | :------------------------- | :------------------------- | :------- | :----- | | Administrative Expenses | 10,642 | 12,477 | (1,835) | (14.7%)| - The decrease was a net effect of a decrease in professional fees of approximately HKD 1,555 thousand, a decrease in share-based payments recognized to zero (2021: HKD 1,782 thousand), and an increase in recognized expected credit losses of approximately HKD 7,485 thousand (2021: HKD 4,869 thousand)[18] Finance Costs Finance costs remained stable, decreasing slightly by HKD 7 thousand to HKD 721 thousand Finance Costs Comparison (HKD thousands) | Metric | For the six months ended September 30, 2022 | For the six months ended September 30, 2021 | Change Amount | | :--- | :------------------------- | :------------------------- | :------- | | Finance Costs | 721 | 728 | (7) | Income Tax Expense The Group's income tax expense was zero in both reporting periods as no taxable profits were generated during the period - Income tax expense remained at zero for the six months ended September 30, 2021, and 2022, due to no taxable profits generated during the period[20] Loss for the Period Loss for the period significantly improved by 92.9% from HKD 5,222 thousand to HKD 369 thousand, primarily due to the net effect of increased gross loss, increased other income, and decreased administrative expenses Loss for the Period Comparison (HKD thousands) | Metric | For the six months ended September 30, 2022 | For the six months ended September 30, 2021 | Change Amount | Change (%) | | :--- | :------------------------- | :------------------------- | :------- | :----- | | Loss for the Period | (369) | (5,222) | 4,853 | 92.9% (Improvement)| - The improvement in loss mainly resulted from the net effect of increased gross loss, increased other income, and decreased administrative expenses[22] Liquidity and Financial Resources As of September 30, 2022, the Group's current ratio remained stable at approximately 1.92 times, total interest-bearing debts slightly decreased, and the gearing ratio remained at approximately 20%, indicating sufficient liquidity - The current ratio increased from approximately 1.71 times as of March 31, 2022, to approximately 1.92 times as of September 30, 2022, remaining stable[23] - Total interest-bearing debts (including bank overdrafts and finance lease liabilities) decreased from approximately HKD 12,155 thousand as of March 31, 2022, to approximately HKD 12,000 thousand as of September 30, 2022[23] - The gearing ratio was approximately 20%, consistent with March 31, 2022, indicating the Group has sufficient liquidity[23] Capital Structure As of September 30, 2022, the company's issued and fully paid share capital was approximately HKD 48,298 thousand, and total equity attributable to owners of the company was approximately HKD 60,144 thousand Capital Structure (As of September 30, 2022) | Metric | Amount (HKD thousands) | | :--- | :---------- | | Issued and Fully Paid Share Capital | 48,298 | | Total Equity Attributable to Owners of the Company | 60,144 | Commitments As of September 30, 2022, the Group had no capital commitments - As of September 30, 2022, the Group had no capital commitments[25] Future Plans for Material Investments and Capital Assets Other than those disclosed in this report, the Group has no other future plans for material investments and capital assets - Other than those disclosed in this report, the Group has no other plans for material investments and capital assets[26] Contingent Liabilities As of September 30, 2022, the Group had no significant contingent liabilities - As of September 30, 2022, the Group had no significant contingent liabilities[28] Material Investments, Acquisitions and Disposals Other than those disclosed in the "Principal Investments" section, the Group had no material investments, acquisitions, or disposals of subsidiaries and associated companies during the six months ended September 30, 2022 - Other than those disclosed in the "Principal Investments" section of this report, the Group had no material investments, acquisitions, or disposals of subsidiaries and associated companies during the six months ended September 30, 2022[29] Exchange Rate Fluctuation Risk As the Group's operations are primarily in Hong Kong and the Hong Kong Dollar is pegged to the US Dollar, the Directors believe the Group faces minimal foreign exchange risk and currently has no foreign currency hedging policy - The Group's business operations are conducted in Hong Kong, with transactions, monetary assets, and liabilities denominated in HKD and USD[30] - As the US Dollar is pegged to the Hong Kong Dollar at an exchange rate of USD 1 to HKD 7.80, the Directors believe the Group faces minimal foreign exchange risk[30] - The Group currently has no foreign currency hedging policy for foreign currency transactions, assets, and liabilities[30] Pledge of the Group's Assets As of September 30, 2022, the Group's total interest-bearing debts (including finance lease liabilities) were zero, indicating no assets were pledged - As of September 30, 2022, the Group's total interest-bearing debts (including finance lease liabilities) were zero[31] Employees and Remuneration Policy As of September 30, 2022, the Group employed 38 staff with total staff costs of approximately HKD 8,115 thousand; remuneration is determined by qualifications, position, and seniority, with discretionary bonuses, retirement benefits, and training subsidies provided to attract and retain talent Employee Headcount and Cost Comparison | Metric | As of September 30, 2022 | As of March 31, 2022 | | :--- | :---------------- | :---------------- | | Employee Headcount | 38 | 43 | | Metric | For the six months ended September 30, 2022 (HKD thousands) | For the six months ended September 30, 2021 (HKD thousands) | | :--- | :-------------------------------- | :-------------------------------- | | Total Staff Costs | 8,115 | 13,007 | - Remuneration is determined based on each employee's qualifications, position, and seniority, with year-end discretionary bonuses based on Group and individual performance[32] - The Group provides retirement benefits, various training, and subsidies for training courses, and adopts an annual review mechanism to assess employee performance[32] Interim Dividend The Board recommended no interim dividend for the six months ended September 30, 2022, and 2021 - The Board recommended no interim dividend for the six months ended September 30, 2022, and 2021[33] Key Risks and Uncertainties The Group faces multiple risks, including high customer concentration, liquidity risk, inaccurate tender price estimates, cash flow mismatch, reliance on key personnel, and adverse weather impacts on outdoor operations - High customer concentration: For the six months ended September 30, 2022, the top five customers contributed approximately 100% of total revenue, with the largest customer accounting for approximately 74.3% of total revenue[35] - Liquidity risk: Failure to assign receivables or generate sufficient cash could significantly and adversely affect liquidity and financial position[35] - Profitability risk: Errors or inaccuracies in estimating project duration and costs when determining tender prices, or rising construction costs, could adversely affect profitability or lead to significant losses[35] - Talent reliance risk: The Group relies heavily on the contributions of senior management and internal professionals; failure to timely recruit and retain suitable talent could have an adverse impact[35] - Operational risk: Business operations are conducted outdoors and are affected by weather conditions; adverse weather could lead to operational disruptions, reduced revenue, and profitability[35] Disclosure of Interests This section discloses the long positions of Directors and Chief Executives in the company's shares and related shares, with Executive Director Ms. Yu Hiu holding 0.55% interest, and confirms no other major shareholders hold disclosable interests or short positions apart from the Directors Directors' and Chief Executives' Interests and Short Positions in Shares, Underlying Shares, and Debentures of the Company As of September 30, 2022, Executive Director Ms. Yu Hiu held 0.55% of the company's issued share capital, including ordinary shares and unlisted share options; Independent Non-executive Directors Mr. Liu Hung Ho and Ms. Lau Yin Kam each held 0.26% of ordinary shares Directors' and Chief Executives' Long Positions in Shares and Underlying Shares of the Company (As of September 30, 2022) | Director Name | Number of Ordinary Shares/Underlying Shares (Personal Interest) | Total | Percentage of Company's Issued Share Capital | | :--- | :------------------------- | :--- | :------------------- | | Yu Hiu (Ordinary Shares) | 780,000 | 1,671,540 | 0.55% | | Yu Hiu (Unlisted Share Options) | 891,540 | | | | Liu Hung Ho (Ordinary Shares) | 780,000 | 780,000 | 0.26% | | Lau Yin Kam (Ordinary Shares) | 780,000 | 780,000 | 0.26% | Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares As of September 30, 2022, no other persons, apart from the Directors and Chief Executives of the Company, had notified the Company of any interests or short positions in the shares or underlying shares required to be entered in the register - Apart from the Directors and Chief Executives of the Company, no other persons had notified the Company of any interests or short positions in the shares or underlying shares of the Company required to be entered in the register[38] Competing Interests The Directors confirm that as of September 30, 2022, and up to the date of this report, no controlling shareholder or Director and their close associates had any interest in any business that competes with the Group's business - The Directors confirm that no controlling shareholder or Director and their respective close associates had any interest in any business that directly or indirectly competes or may compete with the Group's business[39] Purchase, Sale or Redemption of the Company's Listed Securities Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended September 30, 2022 - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended September 30, 2022[40] Corporate Governance Code The Company confirms that it has complied with all applicable code provisions of the Corporate Governance Code set out in Appendix 15 to the GEM Listing Rules for the six months ended September 30, 2022, and up to the date of this report - The Company has complied with all applicable code provisions of the Corporate Governance Code and Corporate Governance Report set out in Appendix 15 to the GEM Listing Rules[41] Code of Conduct for Securities Transactions by Directors The Company has adopted a code of conduct as required by the GEM Listing Rules, and all Directors confirm full compliance with this code during the reporting period - The Company has adopted the required standards set out in Rules 5.48 to 5.67 of the GEM Listing Rules as the code of conduct for Directors' securities transactions in the Company's shares[42] - All Directors have confirmed their full compliance with the required standards for dealing set out in the code of conduct for the six months ended September 30, 2022, and up to the date of this report[42] Disclosure Required under Rule 17.50(2) of the GEM Listing Rules As of the date of this report, the Directors confirm that there are no other matters concerning the appointment of Directors that require disclosure under Rule 17.50(2) of the GEM Listing Rules - As of the date of this report, there are no other matters concerning the appointment of Directors that need to be brought to the attention of shareholders, nor any information concerning the Directors that requires disclosure under Rule 17.50(2) of the GEM Listing Rules[43] Share Option Scheme The Company adopted a share option scheme in 2016, and as of September 30, 2022, 26,974,800 unlisted share options were granted with an exercise price of HKD 0.16 each; these options were granted to Directors, employees, and consultants to retain and incentivize them to enhance company value - The Company's share option scheme was adopted on March 24, 2016, with terms determined in accordance with Chapter 23 of the GEM Listing Rules[45] Share Option Overview (As of September 30, 2022) | Category | Balance as of April 1, 2022 (units) | Lapsed During the Period (units) | Balance as of September 30, 2022 (units) | | :--- | :----------------------- | :-------------- | :----------------------- | | Directors | 891,540 | (891,540) | 891,540 | | Other Employees | 23,408,640 | – | 23,408,640 | | Consultants | 2,674,620 | – | 2,674,620 | | Total | 27,866,340 | (891,540) | 26,974,800 | - Share options have been granted to Directors, employees, and consultants as incentives to encourage their continued service to the Group and maintain long-term relationships with them[47] Events After Reporting Period The Board is not aware of any significant events requiring disclosure that occurred after September 30, 2022, up to the date of this report - The Board is not aware of any significant events requiring disclosure that occurred after September 30, 2022, up to the date of this report[49] Audit Committee The Company's Audit Committee comprises three independent non-executive Directors, with Mr. Wong Chi Kam as Chairman; the Committee has reviewed the Group's unaudited consolidated financial statements for the six months ended September 30, 2022, and found them to be in compliance with applicable accounting standards and Listing Rules - The Audit Committee comprises three independent non-executive Directors, Mr. Liu Hung Ho, Mr. Wong Chi Kam, and Ms. Lau Yin Kam, with Mr. Wong Chi Kam serving as Chairman[50] - The Audit Committee has reviewed the Group's unaudited consolidated financial statements for the six months ended September 30, 2022, and believes the results comply with applicable accounting standards, the requirements of the GEM Listing Rules, and other applicable legal requirements[50] Condensed Consolidated Statement of Comprehensive Income (Unaudited) Condensed Consolidated Statement of Comprehensive Income (Unaudited) For the six months ended September 30, 2022, the Group's loss for the period significantly improved by 92.9% to HKD 369 thousand; despite a 23.5% decrease in revenue and a shift to gross loss, this was primarily due to a substantial increase in other income and reduced administrative expenses; basic and diluted loss per share also improved from 5.39 HK cents to 0.12 HK cents Key Data from Condensed Consolidated Statement of Comprehensive Income (For the six months ended September 30, HKD thousands) | Metric | 2022 | 2021 | Change Amount | Change (%) | | :--- | :----- | :----- | :------- | :----- | | Revenue | 37,787 | 49,403 | (11,616) | (23.5%)| | Gross Profit/(Loss) | (4,143) | 1,610 | (5,753) | (357.3%)| | Other Income/(Loss) | 15,137 | 6,373 | 8,764 | 137.5% | | Administrative and Other Operating Expenses | (10,642) | (12,477) | 1,835 | (14.7%)| | Operating Profit/(Loss) | 352 | (4,494) | 4,846 | 107.8% (Improvement)| | Profit/(Loss) for the Period | (369) | (5,222) | 4,853 | 92.9% (Improvement)| | Basic and Diluted Earnings/(Loss) Per Share (HK cents) | (0.12) | (5.39) | 5.27 | 97.8% (Improvement)| - The significant improvement in loss for the period was mainly attributable to a substantial increase in other income, particularly realized and unrealized gains from financial assets at fair value through profit or loss[52] Condensed Consolidated Statement of Financial Position (Unaudited) Condensed Consolidated Statement of Financial Position (Unaudited) As of September 30, 2022, the Group's total assets slightly decreased, mainly due to reductions in trade and other receivables and cash and cash equivalents, partially offset by an increase in financial assets at fair value through profit or loss; current liabilities significantly decreased, especially amounts payable to a former shareholder, resulting in relatively stable net current assets and total equity attributable to owners of the company Key Data from Condensed Consolidated Statement of Financial Position (HKD thousands) | Metric | As of September 30, 2022 | As of March 31, 2022 | Change Amount | Change (%) | | :--- | :------------- | :------------- | :------- | :----- | | Non-current Assets | 1,211 | 1,350 | (139) | (10.3%)| | Current Assets | 122,815 | 142,997 | (20,182) | (14.1%)| | Total Assets | 124,026 | 144,347 | (20,321) | (14.1%)| | Current Liabilities | 63,882 | 83,834 | (19,952) | (23.8%)| | Net Current Assets | 58,933 | 59,163 | (230) | (0.4%) | | Total Equity Attributable to Owners of the Company | 60,144 | 60,513 | (369) | (0.6%)| - Within current assets, trade and other receivables significantly decreased from HKD 55,241 thousand to HKD 25,461 thousand, and cash and cash equivalents decreased from HKD 8,201 thousand to HKD 4,596 thousand, while financial assets at fair value through profit or loss increased from HKD 36,499 thousand to HKD 49,601 thousand[54] - The decrease in current liabilities was mainly due to a reduction in amounts payable to a former shareholder from HKD 42,964 thousand to HKD 20,042 thousand[54] Condensed Consolidated Statement of Changes in Equity (Unaudited) Condensed Consolidated Statement of Changes in Equity (Unaudited) For the six months ended September 30, 2022, total equity attributable to owners of the company slightly decreased by HKD 369 thousand to HKD 60,144 thousand; this was primarily due to the loss for the period, partially offset by a reduction in share-based payment reserve due to lapsed share options Key Data from Condensed Consolidated Statement of Changes in Equity (As of September 30, HKD thousands) | Metric | Balance as of April 1, 2022 | Share Options Lapsed During the Period | Loss and Total Comprehensive Loss for the Period | Balance as of September 30, 2022 | | :--- | :------------------- | :------------- | :--------------------- | :------------------- | | Share Capital | 48,298 | – | – | 48,298 | | Share Premium | 60,696 | – | – | 60,696 | | Share-based Payment Reserve | 6,462 | (433) | – | 6,029 | | Accumulated Losses | (69,163) | 433 | (369) | (69,099) | | Total Equity Attributable to Owners of the Company | 60,513 | – | (369) | 60,144 | - The decrease in total equity was mainly due to the loss for the period of HKD 369 thousand, partially offset by a reduction of HKD 433 thousand in share-based payment reserve due to lapsed share options[55] Condensed Consolidated Statement of Cash Flows (Unaudited) Condensed Consolidated Statement of Cash Flows (Unaudited) For the six months ended September 30, 2022, net cash used in operating activities significantly improved, decreasing from an outflow of HKD 9,724 thousand in the prior period to an outflow of HKD 3,605 thousand; there was no net cash from investing or financing activities during the period, resulting in a net decrease in cash and cash equivalents of HKD 3,605 thousand, with an ending cash balance of HKD 4,596 thousand Key Data from Condensed Consolidated Statement of Cash Flows (For the six months ended September 30, HKD thousands) | Metric | 2022 | 2021 | Change Amount | | :--- | :----- | :----- | :------- | | Net Cash Used in Operating Activities | (3,605) | (9,724) | 6,119 (Improvement)| | Net Cash Generated from Investing Activities | – | – | 0 | | Net Cash Generated from Financing Activities | – | 2,527 | (2,527) | | Net Decrease in Cash and Cash Equivalents | (3,605) | (7,197) | 3,592 (Improvement)| | Cash and Cash Equivalents at End of Period | 4,596 | 8,375 | (3,779) | - Net cash used in operating activities significantly improved, indicating enhanced efficiency in managing operating cash flow[57] - There was no net cash from investing or financing activities during the period, contrasting with the prior period's net cash from financing activities of HKD 2,527 thousand[57] Notes to the Unaudited Interim Financial Report 1. General Information This note states that Luen Wong Group Holdings Limited was incorporated in the Cayman Islands in 2015 and listed on GEM of the Stock Exchange in 2016, primarily engaged in investment holding and civil engineering services in Hong Kong - The Company was incorporated in the Cayman Islands on October 16, 2015, and listed on GEM of the Stock Exchange on April 12, 2016[59][61] - The Group is principally engaged in the provision of civil engineering services and investment holding[60] 2. Basis of Preparation This unaudited interim financial report is prepared in accordance with HKAS 34 and applicable GEM Listing Rules, with consistent accounting policies as the annual consolidated financial statements, reviewed by the Audit Committee but not audited by the auditor - This report is prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the GEM Listing Rules[62] - The accounting policies used are consistent with those adopted in the Group's annual consolidated financial statements for the year ended March 31, 2022[62] - The unaudited interim financial report has not been audited by the Company's auditor but has been reviewed by the Company's Audit Committee[64] 3. Revenue The Group's revenue represents the consideration received and receivable for providing civil engineering services - Revenue represents the consideration received and receivable for the provision of civil engineering services[65] 4. Segment Information The Group's operating activities constitute a single reportable and operating segment, primarily focused on providing civil engineering services; all revenue and non-current assets are from Hong Kong; customer concentration is high, with Customer 3 being the largest revenue contributor for the six months ended September 30, 2022 (a) Geographical Information The Group's operations, all revenue, and non-current assets are located in Hong Kong - The Group's operations are located in Hong Kong, and all the Group's revenue is derived from customers in Hong Kong. The Group's non-current assets are located in Hong Kong[68] (b) Major Customers For the six months ended September 30, 2022, Customer 3's revenue contribution significantly increased to HKD 28,084 thousand, becoming the largest customer, while Customer 1's contribution substantially decreased Major Customer Revenue Contribution (For the six months ended September 30, HKD thousands) | Customer | 2022 | 2021 | | :--- | :----- | :----- | | Customer 1 | 8,493 | 28,780 | | Customer 2 | – | 7,897 | | Customer 3 | 28,084 | 7,501 | - For the six months ended September 30, 2022, Customer 3's revenue contribution significantly increased, while Customer 1's contribution substantially decreased[69] 5. Other Income/(Loss) For the six months ended September 30, 2022, other income was HKD 15,137 thousand, primarily contributed by realized and unrealized gains from financial assets at fair value through profit or loss of HKD 13,102 thousand, in addition to government subsidies and refunded severance payments Other Income/(Loss) Details (For the six months ended September 30, HKD thousands) | Item | 2022 | 2021 | | :--- | :----- | :----- | | Excess Provision for Severance Payments | 1,080 | 159 | | Realized and Unrealized Gains/(Losses) from Fair Value Changes of Financial Assets at FVTPL | 13,102 | 6,209 | | Subsidies Granted by HKSAR Government | 512 | – | | Refund of Employee Compensation Claims | 413 | – | | Miscellaneous Income | 30 | 5 | | Total | 15,137 | 6,373 | - Realized and unrealized gains from fair value changes of financial assets at fair value through profit or loss were the main component of other income, increasing from HKD 6,209 thousand in 2021 to HKD 13,102 thousand in 2022[70] 6. Finance Costs For the six months ended September 30, 2022, finance costs were HKD 721 thousand, primarily consisting of interest on bonds payable Finance Costs Details (For the six months ended September 30, HKD thousands) | Item | 2022 | 2021 | | :--- | :----- | :----- | | Interest on Bonds Payable | 720 | 720 | | Finance Charges on Lease Liabilities | 1 | 8 | | Total | 721 | 728 | 7. Profit/(Loss) Before Income Tax This note lists expenses deducted in calculating profit/(loss) before income tax, including depreciation, impairment losses recognized under the expected credit loss model (HKD 7,485 thousand in 2022, significantly higher than 2021), site equipment rental costs, and zero share-based payment expenses in 2022 Items Deducted in Calculating Profit/(Loss) Before Income Tax (For the six months ended September 30, HKD thousands) | Item | 2022 | 2021 | | :--- | :----- | :----- | | Depreciation | 140 | 209 | | Impairment Losses Recognized under ECL Model (Net of Reversals) | 7,485 | 4,869 | | Site Equipment Rental Costs (Included in Cost of Sales) | 1,374 | 4,196 | | Share-based Payment Expenses | – | 1,782 | - Impairment losses recognized under the expected credit loss model increased from HKD 4,869 thousand in 2021 to HKD 7,485 thousand in 2022[73] - Share-based payment expenses were zero in 2022, compared to HKD 1,782 thousand in 2021[73] 8. Income Tax Expense The Group's income tax expense was zero for the six months ended September 30, 2022, and 2021, as no taxable profits were generated during the period - The Group's income tax expense remained at zero for the six months ended September 30, 2021, and 2022, due to no taxable profits generated during the period[74][75] 9. Employee Benefit Expenses (Including Directors' Emoluments) For the six months ended September 30, 2022, total employee benefit expenses (including Directors' emoluments) were HKD 5,115 thousand, a significant decrease from HKD 13,007 thousand in the prior period, mainly due to reduced salaries, wages, and other benefits Employee Benefit Expenses Details (For the six months ended September 30, HKD thousands) | Item | 2022 | 2021 | Change Amount | Change (%) | | :--- | :----- | :----- | :------- | :----- | | Salaries, Wages and Other Benefits | 4,965 | 12,619 | (7,654) | (60.7%)| | Contributions to Defined Contribution Retirement Schemes | 150 | 388 | (238) | (61.3%)| | Total | 5,115 | 13,007 | (7,892) | (60.7%)| 10. Dividends The Board recommended no interim dividend for the six months ended September 30, 2022, and 2021 - The Board recommended no interim dividend for the six months ended September 30, 2022, and 2021[78] 11. Earnings/(Loss) Per Share For the six months ended September 30, 2022, basic and diluted loss per share attributable to owners of the company significantly improved to 0.12 HK cents (2021: 5.39 HK cents), reflecting the reduced loss for the period; diluted loss per share equals basic loss per share as there were no potentially dilutive ordinary shares Earnings/(Loss) Per Share Calculation (For the six months ended September 30) | Metric | 2022 | 2021 | | :--- | :----- | :----- | | Profit/(Loss) for the Period Attributable to Owners of the Company (HKD thousands) | (369) | (5,222) | | Weighted Average Number of Ordinary Shares (thousands of shares) | 301,860 | 96,900 | | Basic and Diluted Earnings/(Loss) Per Share (HK cents) | (0.12) | (5.39) | - As there were no potentially dilutive ordinary shares for the periods ended September 30, 2022, and 2021, the diluted loss per share is equal to the basic loss per share[79] 12. Property, Plant and Equipment For the six months ended September 30, 2022, the Group did not acquire or dispose of any property, plant, and equipment - For the six months ended September 30, 2022, the Group did not acquire or dispose of any property, plant, and equipment[80] 13. Contract Assets As of September 30, 2022, contract assets slightly increased to HKD 40,231 thousand, primarily representing retention receivables from construction contracts; of this, HKD 29,765 thousand is expected to be recovered after one year Contract Assets Details (HKD thousands) | Item | As of September 30, 2022 | As of March 31, 2022 | | :--- | :------------- | :------------- | | Retention Receivables from Construction Contracts | 40,309 | 39,689 | | Less: Allowance for Credit Losses | (78) | (33) | | Contract Assets | 40,231 | 39,656 | - The amount of contract assets expected to be recovered after one year is HKD 29,765 thousand, all related to retention money[83] 14. Trade and Other Receivables As of September 30, 2022, trade and other receivables significantly decreased by 53.9% to HKD 25,461 thousand, mainly due to a 63.3% reduction in trade receivables (net of allowance); the allowance for credit losses increased, and trade receivables over 365 days significantly decreased Trade and Other Receivables Details (HKD thousands) | Item | As of September 30, 2022 | As of March 31, 2022 | Change Amount | Change (%) | | :--- | :------------- | :------------- | :------- | :----- | | Trade Receivables (Net of Allowance) | 18,385 | 50,095 | (31,710) | (63.3%)| | Amount Due from a Securities Broker | 203 | 203 | 0 | 0% | | Performance Bond Deposits | 2,981 | 3,154 | (173) | (5.5%) | | Other Receivables, Deposits and Prepayments | 4,559 | 2,456 | 2,103 | 85.6% | | Less: Prepayments Classified as Non-current Portion | (667) | (667) | 0 | 0% | | Total | 25,461 | 55,241 | (29,780) | (53.9%)| Ageing Analysis of Trade Receivables (HKD thousands) | Ageing | As of September 30, 2022 | As of March 31, 2022 | | :--- | :------------- | :------------- | | 0 to 30 days | 1,510 | 6,444 | | 31 to 60 days | 851 | 1,443 | | 61 to 90 days | 598 | – | | 91 to 180 days | 4,025 | – | | 181 to 365 days | 439 | 1,772 | | Over 365 days | 10,962 | 40,436 | | Total | 18,385 | 50,095 | - The Group generally grants credit terms of 30 to 45 days to its customers[86] 15. Trade and Other Payables As of September 30, 2022, trade and other payables increased by 14.6% to HKD 28,291 thousand, primarily due to a substantial increase in accrued expenses and other payables, while trade payables decreased Trade and Other Payables Details (HKD thousands) | Item | As of September 30, 2022 | As of March 31, 2022 | Change Amount | Change (%) | | :--- | :------------- | :------------- | :------- | :----- | | Trade Payables | 6,829 | 8,613 | (1,784) | (20.7%)| | Retention Payables | 11,786 | 11,171 | 615 | 5.5% | | Long Service Payment Provision | 966 | 965 | 1 | 0.1% | | Amounts Due to Directors of Certain Subsidiaries | 1,169 | 1,145 | 24 | 2.1% | | Accruals and Other Payables | 7,541 | 2,794 | 4,747 | 170.0% | | Total | 28,291 | 24,688 | 3,603 | 14.6%| Ageing Analysis of Trade Payables (HKD thousands) | Ageing | As of September 30, 2022 | As of March 31, 2022 | | :--- | :------------- | :------------- | | 0 to 30 days | 2,299 | 5,724 | | 31 to 60 days | 847 | 585 | | 61 to 90 days | 1,053 | 292 | | Over 90 days | 2,630 | 2,012 | | Total | 6,829 | 8,613 | - The Group is granted credit terms of 0 to 30 days by its suppliers[88] 16. Share Capital As of September 30, 2022, the Company's authorized and issued and fully paid share capital remained unchanged at HKD 80,000 thousand and HKD 48,298 thousand, respectively Share Capital Details (HKD thousands) | Item | Number of Shares (thousands of shares) | Share Par Value (HKD thousands) | | :--- | :------------- | :------------- | | Authorized Share Capital (Par Value HKD 0.16 per share) | 500,000 | 80,000 | | Issued and Fully Paid Share Capital (Par Value HKD 0.16 per share) | 301,860 | 48,298 | - There were no changes in authorized share capital and issued and fully paid share capital between April 1, 2022, and September 30, 2022[89]