Business Overview - The Group's principal business remains in Integrated Financial Services, investment holdings, CGI business, and entertainment business, with new activities in film distribution license rights and artiste management services introduced during the Year under Review [27]. - The Group's integrated financial services remain the core business, focusing on securities brokerage, margin financing, and asset management [112]. - The Group's entertainment business will seek additional opportunities in film investment and distribution, particularly in local films [82]. - The Group is developing film distribution license rights in Hong Kong/Macau and North America, and is investing in film production and variety shows [169][170]. Financial Performance - For the year ended December 31, 2023, the Group recorded a revenue of approximately HK$49 million, representing a decrease of 17% compared to the financial year of 2022 [74]. - The net loss attributable to the shareholders for the year under review was approximately HK$13 million [74]. - Revenue from interest income on loans receivable decreased from approximately HK$16 million to approximately HK$10 million, while total revenue from the securities brokerage and asset management segment dropped from approximately HK$49 million to approximately HK$42 million [196]. - The Group recorded a net realised loss of approximately HK$3.7 million from sales of listed equity investments and unrealised losses of approximately HK$20.9 million from changes in fair value of listed equity investments classified as held-for-trading for the Year under Review [133]. Dividend Policy - The Directors do not recommend the payment of a dividend for the Year under Review, consistent with the previous year where no dividend was declared [29]. - The Company is committed to balancing sufficient capital maintenance for business operations while rewarding shareholders, as outlined in its Dividend Policy [10]. - The Board will consider liquidity position, return on equity, and relevant financial covenants when determining dividend payments [13]. Risk Management and Internal Controls - The Company confirmed that its risk management and internal control systems are adequate and effective, as acknowledged by the Board following an annual review [4]. - The Company has engaged in ongoing reviews of key financial, operational, and compliance controls, with findings presented to the Audit Committee for endorsement [3]. - The Group has established internal control policies to monitor credit risk in its money lending business [122]. Market Conditions and Future Outlook - The Company anticipates that the overall business environment in Hong Kong and China will gradually improve in 2024 [65]. - The Company expects that the high interest rate regime has peaked and will begin to reverse in the second half of 2024 [65]. - The challenging economic environment was influenced by a plummeting property market in China and high inflation rates globally [74]. - The Group anticipates that the performance of its securities brokerage and related services will continue to improve in 2024, contributing significantly to operations and profits [79]. - The Company expects gradual improvement in the business environment in Hong Kong and China in 2024, driven by easing regulatory measures and stabilizing property markets [103]. Loan and Lending Business - The Group generated total new loan principal of HK$170.2 million and interest income of approximately HK$10 million during the Year under Review [107]. - Outstanding margin loans receivable from the securities brokerage business amounted to approximately HK$297 million as of December 31, 2023, with approximately HK$10 million impairment allowances provided [143]. - The management remains confident that the lending business will continue to provide stable and substantial returns in the future [67]. - The management is confident that the money lending business will continue to provide steady and attractive returns in the future [107]. - The total loan principal drawdown during the Year under Review was HK$170.2 million, with new loan facilities ranging from HK$0.1 million to HK$13 million [160][161]. Impairment and Provisions - Impairment allowances on margin loans receivable and loans receivable increased due to the deteriorating market environment [74]. - The increase in impairment provisions for margin loans and receivables in 2023 was attributed to a weak market environment and expectations [101]. - Impairment allowances of approximately HK$4.6 million were provided on the outstanding loans receivable as of December 31, 2023 [160][161]. Corporate Governance - The Company is committed to enhancing corporate governance and promoting an ethical corporate culture [64]. - The management will take appropriate actions on overdue loans on a case-by-case basis, ensuring effective loan monitoring and repayment collection [128]. Employee Costs - Employee costs for the year amounted to approximately HK$17 million, an increase from approximately HK$15 million in 2022 [187].
元汇集团(00585) - 2023 - 年度财报