Financial Performance - The group's brokerage income and margin financing interest income decreased by approximately 37.9% from HKD 6,600,000 in the previous year to HKD 4,100,000 in the current year[6]. - The revenue from brokerage and margin financing services for the year ended December 31, 2022, was approximately HKD 4,100,000, a decrease of about HKD 2,500,000 or 37.9% compared to the previous year[22]. - The brokerage commission income from futures and options trading in the Hong Kong market was HKD 1,945,000, down 34.9% from HKD 2,989,000 in the previous year[24]. - The brokerage commission income from overseas markets decreased by 65.6%, from HKD 3,028,000 to HKD 1,043,000[24]. - The total income from brokerage services and margin financing was HKD 4,102,000, representing 100% of total revenue for the year[24]. - The company recorded a loss of approximately HKD 12,700,000 for the year, a decrease from a loss of HKD 20,200,000 in the previous year, primarily due to cost reduction measures[36]. - The company's total revenue for the year ended December 31, 2022, was approximately HKD 7,000,000, a slight increase of about 6.4% compared to HKD 6,600,000 in the previous year[36]. - The company reported a pre-tax loss of HKD 14,384,000 for 2022, an improvement from a loss of HKD 23,069,000 in 2021, reflecting a reduction of 37.0%[197]. - Net loss attributable to owners for the year was HKD 12,740,000, down from HKD 20,167,000 in 2021, indicating a 37.9% improvement[197]. - Basic loss per share improved to HKD 1.59 in 2022 from HKD 2.52 in 2021[197]. Revenue Sources - Interest income from the newly established lending business amounted to approximately HKD 2,900,000, accounting for over 40% of total revenue[6]. - Interest income from margin financing increased by 147.6%, from HKD 187,000 to HKD 463,000[24]. - The company’s interest income from receivables was approximately HKD 2,900,000 for the year[31]. - The company’s other income netted approximately HKD 800,000 for the year, an increase from HKD 300,000 in the previous year, mainly due to increased government subsidies[37]. - The company aims to diversify its product offerings and services for existing clients, with expectations of increased commission income from placements in 2023[48]. Customer Activity - The number of active customers and transaction volume declined compared to the previous year due to intense competition from other internet brokerage firms[6]. - Active customers decreased by approximately 16.1%, from 286 to 240, due to some Chinese customers terminating futures and options contracts[30]. Business Strategy - The business performance is expected to improve in 2023 as Hong Kong and mainland China resume cross-border travel, potentially increasing brokerage income from Chinese clients[7]. - The company plans to explore more opportunities beyond brokerage services, such as placements and other corporate financing activities, to achieve further revenue growth[7]. - The company has initiated several measures to promote brokerage services and develop new distribution channels, expecting these initiatives to yield results in the coming year[22]. - The company is focused on expanding its brokerage business and enhancing its service offerings to improve financial performance[22]. - The management team is optimistic about the future outlook and believes that the implemented strategies will lead to recovery in the upcoming fiscal year[22]. Credit Risk Management - The management will adopt a cautious approach regarding the renewal of loans for borrowers primarily operating in the property market in China to minimize credit risk[7]. - The expected credit loss ratio for corporate structured loans is 5.6%, while the ratio for mortgage loans is 0%[33]. - The credit loss provision of HKD 1,441,000 has been recognized in the consolidated profit and loss and other comprehensive income statement for the year ended December 31, 2022[185]. - The company’s management regularly reviews overdue receivables and assesses the expected credit loss provision[187]. - The credit loss provision is based on the expected credit loss model as per Hong Kong Financial Reporting Standards No. 9[185]. Corporate Governance - The board consists of six members, including three executive directors and three independent non-executive directors[61]. - The company has adopted the GEM Listing Rules regarding securities trading standards, confirming compliance by all directors for the year ended December 31, 2022[59]. - The company has established a board independence assessment mechanism, with satisfactory results reported for the year ended December 31, 2022[67]. - All independent non-executive directors have submitted annual confirmations of their independence, and the company believes they are all independent individuals[66]. - The chairman and CEO roles are held by the same person, Mr. Pan Guohua, which the board believes is in the best interest of the company[65]. - The company has established four committees: Audit Committee, Remuneration Committee, Nomination Committee, and Risk Management Committee to oversee specific aspects of its affairs[78]. - The Audit Committee held five meetings during the year ended December 31, 2022, to review financial performance and internal controls[79]. - The Remuneration Committee conducted one meeting to review and recommend salary adjustments for directors and senior management for 2022[82]. - The Nomination Committee held one meeting to review the board's diversity policy and the independence of non-executive directors[84]. - The company provides tailored training for new directors to ensure understanding of business operations and regulatory responsibilities[78]. Financial Position - The total liabilities of the group as of December 31, 2022, amounted to approximately HKD 1,256,000[180]. - The total borrowings of the group were approximately HKD 49,400,000, with cash and cash equivalents of only about HKD 5,861,000[180]. - The company’s total equity decreased to HKD (1,256,000) in 2022 from HKD 11,484,000 in 2021, indicating a significant decline[199]. - The company has a cash and cash equivalents balance of HKD 5,861,000 as of December 31, 2022, compared to HKD 5,637,000 in 2021, showing a slight increase of 4.0%[199]. Shareholder Information - The company has adopted a dividend policy without a preset payout ratio, allowing the board to declare dividends based on various factors including financial performance and cash flow[123]. - No final dividend was recommended for the fiscal year, consistent with the previous year where no dividend was declared[130]. - As of December 31, 2022, the total distributable reserves available to shareholders were zero HKD, compared to approximately 3,239,000 HKD in the previous year[137]. - The company's major clients accounted for approximately 7.2% and 31.1% of total revenue for the fiscal year[139].
立桥证券控股(08350) - 2022 - 年度财报