Revenue and Financial Performance - For the fiscal year ending December 31, 2023, the group's revenue decreased by HKD 1,608,000 or 4.0% to HKD 38,267,000, primarily due to a decline in property management and related services revenue, partially offset by an increase in rental income from investment properties[30]. - Revenue from property management and related services recorded HKD 25,365,000, down from HKD 27,768,000 in the previous year[27]. - The group’s gardening services and plant sales revenue increased by HKD 161,000 or 2.5% to HKD 6,504,000[32]. - Rental income from investment properties in Hong Kong rose by HKD 634,000 or 11% to HKD 6,398,000, attributed to an increase in average rental income per apartment[33]. - The group recorded a profit of HKD 2,182,000 for the year, compared to a loss of HKD 47,007,000 for the year ended December 31, 2022, primarily due to a fair value gain of HKD 2,000,000 on investment properties, while the previous year had a fair value loss of HKD 46,000,000[38]. - As of December 31, 2023, the fair value of pledged investment properties was HKD 348,000,000, slightly up from HKD 346,000,000 in 2022[39]. - The group has pledged investment properties and bank deposits valued at HKD 363,332,000 as of December 31, 2023, to secure bank borrowings[190]. Costs and Expenses - Employee costs increased by HKD 2,419,000 or 13.1% to HKD 20,922,000, mainly due to salary increases and growth in employee numbers[36]. - Other property management-related expenses decreased by HKD 2,260,000 or 24.2% to HKD 7,095,000, mainly due to the absence of one-time repair and maintenance costs in Shenzhen[43]. - Other operating and administrative expenses increased by HKD 512,000 or 7.0% to HKD 7,809,000, primarily due to higher legal and professional fees incurred during the year[44]. - The total employee cost for the year ended December 31, 2023, was approximately HKD 20,922,000, an increase from HKD 18,503,000 in 2022[189]. Financing and Debt - Financing costs rose by HKD 3,435,000 or 70.8% to HKD 8,289,000, due to an increase in bank borrowing rates[37]. - Bank loans remained unchanged at HKD 160,000,000 as of December 31, 2023, secured by investment properties valued at HKD 348,000,000 and other collateral[41]. - The company has a bank loan principal of HKD 160,000,000 outstanding as of December 31, 2023, unchanged from the previous year[102]. - The company will repay the bank loan principal of HKD 16,000,000 by March 2024[94]. - The group has outstanding bank borrowings amounting to HKD 160,000,000, unchanged from the previous year[187]. - The group received written confirmation from its controlling shareholder to continue providing financial support for debt repayment for at least the next twelve months[189]. Corporate Governance - The company has established a Nomination Committee, which is responsible for reviewing the board's structure, composition, and diversity, ensuring fair and transparent nominations[78]. - The board has achieved a measurable target of having at least one female director, with the current gender ratio being 2:1 in favor of male directors[82]. - The company is committed to maintaining gender diversity and equality among its employees, with a current gender ratio of 5:2 among staff, including senior management[82]. - The company has established a Compensation Committee to review the overall compensation policy for all directors and senior management, making recommendations to the board[90]. - The company has complied with all corporate governance code provisions except for the separation of the roles of Chairman and CEO, which are held by the same individual[109]. - The company has established mechanisms to ensure independent opinions and suggestions are available to the board[115]. - The company has a structured approach to review its corporate governance policies regularly[109]. - The company has adopted a shareholder communication policy to ensure effective and timely information dissemination[150]. Shareholder Information - As of December 31, 2023, the major shareholder, Central Asia Holdings Group Limited, holds 2,112,395,735 ordinary shares, representing 74.93% of the company's equity[85]. - The company has not disclosed any interests held by directors or their close associates in competing businesses as of December 31, 2023[75]. - The company has not identified any other individuals with interests in its shares, aside from the disclosed major shareholders[76]. - The company has not purchased, sold, or redeemed any of its listed securities during the year ended December 31, 2023[119]. Audit and Compliance - The Audit Committee held two meetings and one meeting with external auditors, reviewing the financial statements for the year ending December 31, 2022, and the interim report for the six months ending June 30, 2023[87]. - The Audit Committee is responsible for monitoring the company's financial reporting procedures and internal control systems, ensuring compliance with listing rules and legal requirements[89]. - The audit committee, composed of three independent non-executive directors, reviewed the financial statements for the year ending December 31, 2023, with no objections raised[199]. - The external auditor's fee for the year was HKD 550,000, with no non-audit services provided[146]. - The company has appointed a new auditor to replace the previous one as of December 6, 2023[106]. Future Outlook and Strategy - The group aims to strengthen its property management and related services to stimulate future revenue and profit growth[4]. - The completion of leasing and subscription agreements is expected to provide stable rental income and ensure cash flow from leased properties[25]. - The group will enhance its competitive advantages and synergies across regions while adhering to a prudent development strategy[25]. - The group continues to engage in property investment and related services, focusing on the Greater Bay Area[24]. - The group expects stable rental income from the Silicon Valley Industrial Park lease agreement, which will enhance cash flow and property management solutions[47]. - A lease agreement was signed for a total area of 350,855 square meters with a total rent of approximately RMB 1,413.4 million (about HKD 1,526.5 million) for a term of 10 years[67]. - The group issued convertible bonds totaling HKD 353,360,000 with a 3.6% interest rate, to fund the deposit under the lease agreement[68]. - The net proceeds from the bond issuance amount to approximately HKD 352,360,000, which will be used to provide funding for a deposit of RMB 282.6 million under a leasing agreement[120]. - The total number of shares to be issued upon full conversion of the bonds is 3,533,600,000, with a total par value of HKD 176,680,000[120]. - The closing price of the company's shares on the Stock Exchange on June 6, 2023, was HKD 0.150[120]. - The company maintained the required public float level as per the listing rules as of the annual report date[121]. - The group has no significant investment or capital asset plans for the year, aside from leasing agreements[191]. - There were no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the year[195].
中亚烯谷集团(00063) - 2023 - 年度财报