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2048317_77.pdf | en | # 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued
# 2.17 Accounting for income taxes (Continued)
The determination of the average tax rates requires an estimation of (1) when the existing temporary differences will reverse and (2) the amount of future taxable profit in those years. The estimate of future taxable profit includes:
– income or loss excluding reversals of temporary differences; and
– reversals of existing temporary differences
Current tax assets and current tax liabilities are presented in net if, and only if,
(a) the Group has the legally enforceable right to set off the recognised amounts; and
(b) intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
The Group presents deferred tax assets and deferred tax liabilities in net if, and only if,
(a) the entity has a legally enforceable right to set off current tax assets against current tax liabilities; and
(b) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on either:
(i) the same taxable entity; or
(ii) different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.
# 2.18 Segment reporting
The Group identifies operating segments and prepares segment information based on the regular internal financial information reported to the chief operating decision maker for their decisions about resources allocation to the Group’s business components and for their review of the performance of those components. |
2048317_78.pdf | en | # 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued
# 2.19 Related parties
For the purposes of the consolidated financial statements, a party is considered to be related to the Group if:
# (a) the party is a person or a close member of that person’s family and if that person:
(i) has control or joint control over the Group;
(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the Group or of a parent of the Group.
# (b) the party is an entity and if any of the following conditions applies:
(i) the entity and the Group are members of the same group;
(ii) one entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a group of which the other entity is a member);
(iii) the entity and the Group are joint ventures of the same third party;
(iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity;
(v) the entity is a post-employment benefit plan for the benefit of employees of either the Group or an entity related to the Group (if the Group is itself such a plan) and the sponsoring employers are also related to the Group;
(vi) the entity is controlled or jointly controlled by a person identified in (a);
(vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity); and
(viii) the entity, or any member of a group of which it is a part, provides key management personnel services to the Group or to the parent of the Group.
Close family members of an individual are those family members who may be expected to influence, or be influenced by, that individual in their dealings with the entity. |
7573998_92.pdf | en | # 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
# Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from the Group’s consolidated statement of financial position) when:
• the rights to receive cash flows from the asset have expired; or
• the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a “pass-through” arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risk and rewards of ownership of the asset. When it has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.
# Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.
# General approach
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, the Group assesses whether the credit risk on a financial instrument has increased significantly since initial recognition. When making the assessment, the Group compares the risk of a default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial instrument as at the date of initial recognition and considers reasonable and supportable information that is available without undue cost or effort, including historical and forward-looking information.
In certain cases, the Group may also consider a financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Group. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. |
7573998_93.pdf | en | # 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
# Impairment of financial assets (continued)
# General approach (continued)
Debt investments at fair value through other comprehensive income and financial assets at amortised cost are subject to impairment under the general approach and they are classified within the following stages for measurement of ECLs except for trade receivables and contract assets which apply the simplified approach as detailed below.
<table><tr><td>Stage 1</td><td>– Financial instruments for which credit risk has not increased significantly since initial recognition and for which
the loss allowance is measured at an amount equal to 12-month ECLs</td></tr><tr><td>Stage 2
Stage 3</td><td>– Financial instruments for which credit risk has increased significantly since initial recognition but that are not
credit-impaired financial assets and for which the loss allowance is measured at an amount equal to lifetime ECLs
– Financial assets that are credit-impaired at the reporting date (but that are not purchased or originated credit-
impaired) and for which the loss allowance is measured at an amount equal to lifetime ECLs</td></tr></table>
# Simplified approach
For trade receivables and contract assets that do not contain a significant financing component or when the Group applies the practical expedient of not adjusting the effect of a significant financing component, the Group applies the simplified approach in calculating ECLs. Under the simplified approach, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Group has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.
# Financial liabilities
# Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.
The Group’s financial liabilities include other payables.
# Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
# Financial liabilities at amortised cost (loans and borrowings)
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost, using the effective interest rate method unless the effect of discounting would be immaterial, in which case they are stated at cost. Gains and losses are recognised in the statement of profit or loss when the liabilities are derecognised as well as through the effective interest rate amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. The effective interest rate amortisation is included in finance costs in profit or loss.
# Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and a recognition of a new liability, and the difference between the respective carrying amounts is recognised in profit or loss. |
11768341_9.pdf | en | Established at the end of 2014, NIO is principally engaged in the research and development, manufacturing, sales and after-sales service of high-end luxury smart electric vehicles. NIO gets hold of the core research and development technologies of the batteries, electric drives and electric control systems of electric vehicles, and has competitiveness in vehicle design and brand promotion and is capable of efficiently integrating vehicle manufacturing supply chain system to promote the entire vehicle manufacturing, which as a whole makes NIO the fastest Internet-based electric vehicle manufacturing enterprise in China in terms of research and development and mass production. ES8, its first high-end luxury 7-seater electric sport utility vehicle (SUV) put into mass production, had been officially launched in December 2017. NIO has gained the supports from various Internet giants and leading investment institutions, among which Tencent is the leading investor of this round of fund-raising of NIO. NIO is an independent third party of the Group.
New energy vehicle industry is in a middle to long term strong growth trend, which has been generally recognised by the society. Recently, the Chinese Government has launched a series of policies and measures to support the rapid development of the new energy vehicle industry in China. The Company has been identifying and exploring quality targets and investment opportunities in new energy vehicle industry. This transaction represents an important exploration of the Company in such area, which is expected to create an outstanding investment return for the Shareholders and further consolidate the overall market advantage of the Company in various modern consumption upgrade sectors, including automobile, logistics, consumption and finance.
# Yimidida
On 30 November 2017, a wholly-owned subsidiary of the Company entered into a capital increment agreement with Yimidida (“Yimidida Capital Increment Agreement”), pursuant to which the Group, as one of the investors, agreed to subscribe for the shares newly issued by Yimidida at a consideration of RMB130.00 million in US\$ equivalent.
Jointly established by several regional leading less-than-truckload logistics enterprises, Yimidida, with the mode of direct operation in core areas and regional franchise, unified the branding, systems, clearing, services and management standards of its partners along the whole ecological chain, and rapidly established the less-than-truckload freight express network across the country. Yimidida improves its franchisees’ ability in soliciting orders and profitability, achieves a strong coalition, and gains its advantages in core network and continuous low cost as a national less-than-truckload express enterprise, by making full use of the long-term operation, high network coverage rate and low operation costs of its regional franchisees and providing national services. Yimidida is an independent third party of the Group.
Logistics industry is a fundamental and strategic industry which supports the national economic development and also a major industry supported by CDB. The Company has been identifying and exploring appropriate investment opportunities in logistics industry and established an investment layout to a certain extent in logistics infrastructure and supply chain service. This transaction represents another achievement of the Company’s continuous efforts in the development of logistics industry and identifying investment opportunities in sub-sectors, which is expected to create an outstanding investment return for the Shareholders and further consolidate the overall market advantage of the Company in various modern service industries, including automobile, logistics, consumption and finance. |
11768341_10.pdf | en | # Wacai
On 8 April 2017, a wholly-owned subsidiary of the Company had entered into a preferred share purchase agreement (the “Wacai Investment Agreement”) with Wacai, pursuant to which the Group, as one of the investors, agreed to subscribe for the newly issued preferred shares of Wacai at a consideration of US\$25.00 million, representing approximately 3.09% of the enlarged issued share capital of Wacai, and the subscription of the preferred shares of Wacai by the Company has been completed.
As one of the earliest established Fin-tech companies in the PRC, Wacai has now become a leading online comprehensive financial planning and wealth management platform in the industry. In June 2009, Wacai launched the first personal finance bookkeeping mobile application named “Wacai Bookkeeper” in the PRC, and since then gradually evolved into a holistic personal finance platform with products including “Wacai Bao Wealth Management”, “Credit Card Manager”, “Money Manager” and “Money Town Community”. With its devotion to providing one-stop online financial management tools, information and advisory services to the mass market, Wacai has developed an ecosystem around personal financial planning, wealth management, credit management, and vertical online discussion forum. Based on the profound understanding of customer needs, user-friendly product design, cutting edge finance technology, and rigorous risk management, Wacai has been providing consistent and high-quality services to over 47.00 million registered users in the past eight years. Wacai is an independent third party of the Group.
# G7
On 29 December 2016, a wholly-owned subsidiary of the Company had entered into a convertible preferred share subscription agreement with G7 pursuant to which the Group, as one of the investors, agreed to subscribe for the newly issued preferred shares of G7 at a cash consideration of US\$25.00 million, representing approximately 5.59% of the enlarged issued share capital of G7.
G7 is a leading logistics data service company in the PRC with its business coverage spanning across the PRC and its neighboring countries in Asia. G7 is connected to over 300,000 cargo vehicles of more than 30,000 customers. By installing smart devices on vehicles in the fleet, G7 utilises the real-time sensing technology to provide data services that span the entire logistic process, to connect the data of every single vehicle, consignor, fleet owner and driver, and thus to improve the efficiency of transport service. Based on the big data of the connected vehicles, G7 cooperates with premium partners from oil distribution, toll roads and bridges, insurance, banking and financial leasing industries to establish a one-stop service platform that integrates primary consumption of fleets. The platform enables safer, more economical, more efficient and more environmentally-friendly logistic services. G7 is an independent third party of the Company.
# Spruce
On 24 November 2016, the Company had entered into an investment agreement with Spruce pursuant to which the Company agreed to subscribe for the newly issued convertible preferred shares of Spruce at a cash consideration of US\$25.70 million, representing approximately 1.24% of the enlarged issued capital of Spruce. |
9319248_316.pdf | en | # IV NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
# 30 DEBT SECURITIES ISSUED (Continued)
# (1) Bonds issued
<table><tr><td rowspan="2"></td><td rowspan="2"></td><td colspan="2">As at 31 December</td></tr><tr><td>2020</td><td>2019</td></tr><tr><td>2.75% USD fixed rate Green Bonds
maturing in October 2020</td><td>(i)</td><td>-</td><td>3,488</td></tr><tr><td>5.30% subordinated fixed rate bonds
maturing in June 2026</td><td>(ii)</td><td>50,000</td><td>50,000</td></tr><tr><td>4.99% subordinated fixed rate bonds
maturing in December 2027</td><td>(iii)</td><td>50,000</td><td>50,000</td></tr><tr><td>4.45% Tier-two capital fixed rate bonds
maturing in October 2027</td><td>(iv)</td><td>40,000</td><td>40,000</td></tr><tr><td>4.45% Tier-two capital fixed rate bonds
maturing in April 2028</td><td>(v)</td><td>40,000</td><td>40,000</td></tr><tr><td>4.28% Tier-two capital fixed rate bonds
maturing in March 2029</td><td>(vi)</td><td>50,000</td><td>50,000</td></tr><tr><td>4.30%Tier-two capital fixed rate bonds
maturing in April 2029</td><td>(vii)</td><td>40,000</td><td>40,000</td></tr><tr><td>3.10% Tier-two capital fixed rate bonds
maturing in April 2030</td><td>(viii)</td><td>40,000</td><td>-</td></tr><tr><td>4.53% Tier-two capital fixed rate bonds
maturing in March 2034</td><td>(ix)</td><td>10,000</td><td>10,000</td></tr><tr><td>4.63% Tier-two capital fixed rate bonds
maturing in April 2034</td><td>(x)</td><td>20,000</td><td>20,000</td></tr><tr><td>Medium term notes issued</td><td>(xi)</td><td>42,643</td><td>31,163</td></tr><tr><td>1.99% fixed rate financial bond
maturing in April 2023</td><td>(xii)</td><td>20,000</td><td>-</td></tr><tr><td>3.68% CNY fixed rate Green Bonds
maturing in June 2022</td><td>(xiii)</td><td>2,720</td><td>3,000</td></tr><tr><td>3.90% fixed rate financial bond
maturing in November 2023</td><td>(xiv)</td><td>1,650</td><td>-</td></tr><tr><td>3.30% fixed rate financial bond
maturing in September 2022</td><td>(xv)</td><td>3,870</td><td>2,890</td></tr><tr><td>2.68% fixed rate financial bond
maturing in March 2023</td><td>(xvi)</td><td>4,000</td><td>-</td></tr><tr><td>4.70% fixed rate capital replenishment
bond maturing in August 2021</td><td>(xvii)</td><td>2,410</td><td>3,000</td></tr><tr><td>3.40% fixed rate financial bond
maturing in September 2024</td><td>(xviii)</td><td>2,000</td><td>1,880</td></tr><tr><td>2.75% fixed rate financial bond
maturing in March 2025</td><td>(xix)</td><td>6,000</td><td>-</td></tr><tr><td>3.80% fixed rate financial bond
maturing in June 2025</td><td>(xx)</td><td>500</td><td>-</td></tr><tr><td>5.55% fixed rate capital replenishment
bond maturing in March 2028</td><td>(xxi)</td><td>3,500</td><td>3,500</td></tr><tr><td>3.60% fixed rate capital replenishment
bond maturing in March 2030</td><td>(xxii)</td><td>1,500</td><td>-</td></tr><tr><td>Total nominal value</td><td></td><td>430,793</td><td>348,921</td></tr><tr><td>Less: Unamortized issuance cost and
discounts</td><td></td><td>(90)</td><td>(235)</td></tr><tr><td>Total</td><td></td><td>430,703</td><td>348,686</td></tr></table> |
9319248_317.pdf | en | # IV NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
# 30 DEBT SECURITIES ISSUED (Continued)
# (1) Bonds issued (Continued):
Pursuant to the approval by relevant regulatory authorities, the bonds issued by the Group are set out as below:
(i) The USD green bonds issued in October 2015 have a tenor of 5 years matured in October 2020.
(ii) The subordinated fixed rate bonds issued in June 2011 have a tenor of 15 years, with a fixed coupon rate of 5.30%, payable annually. The Bank has an option to redeem all of the bonds at face value on 6 June 2021. If the Bank did not exercise this option, the coupon rate of the bonds would remain at 5.30% per annum from 7 June 2021 onwards.
(iii) The subordinated fixed rate bonds issued in December 2012 have a tenor of 15 years, with a fixed coupon rate of 4.99%, payable annually. The Bank has an option to redeem all of the bonds at face value on 19 December 2022. If the Bank did not exercise this option, the coupon rate of the bonds would remain at 4.99% per annum from 20 December 2022 onwards.
(iv) The Tier-two capital bonds issued in October 2017 have a tenor of 10 years, with a fixed coupon rate of 4.45% payable annually. The Bank has an option to redeem part or all of the bonds at face value on 16 October 2022 if specified redemption conditions as stipulated in the offering documents were met, subject to regulatory approval. If the Bank did not exercise this option, the coupon rate of the bonds would remain at 4.45% per annum from 17 October 2022 onwards. These Tier-two capital bonds have the write-down feature of a Tier-two capital instrument and they are qualified as Tier-two Capital Instruments in accordance with the CBIRC requirements.
(v) The Tier-two capital bonds issued in April 2018 have a tenor of 10 years, with a fixed coupon rate of 4.45% payable annually. The Bank has an option to redeem part or all of the bonds at face value on 26 April 2023 if specified redemption conditions as stipulated in the offering documents were met, subject to regulatory approval. If the Bank did not exercise this option, the coupon rate of the bonds would remain at 4.45% per annum from 27 April 2023 onwards. These Tier-two capital bonds have the write-down feature of a Tier-two capital instrument and they are qualified as Tier-two Capital Instruments in accordance with the CBIRC requirements.
(vi) The Tier-two capital bonds issued in March 2019 have a tenor of 10 years, with a fixed coupon rate of 4.28% payable annually. The Bank has an option to redeem part or all of the bonds at face value on 18 March 2024 if specified redemption conditions as stipulated in the offering documents were met, subject to regulatory approval. If the Bank did not exercise this option, the coupon rate of the bonds would remain at 4.28% per annum from 19 March 2024 onwards. These Tier-two capital bonds have the write-down feature of a Tier-two capital instrument and they are qualified as Tier-two Capital Instruments in accordance with the CBIRC requirements.
(vii) The Tier-two capital bonds issued in April 2019 have a tenor of 10 years, with a fixed coupon rate of 4.30% payable annually. The Bank has an option to redeem part or all of the bonds at face value on 10 April 2024 if specified redemption conditions as stipulated in the offering documents were met, subject to regulatory approval. If the Bank did not exercise this option, the coupon rate of the bonds would remain at 4.30% per annum from 11 April 2024 onwards. These Tier-two capital bonds have the write-down feature of a Tier-two capital instrument and they are qualified as Tier-two Capital Instruments in accordance with the CBIRC requirements. |
11695155_160.pdf | en | # 7. FINANCIAL INSTRUMENTS (Continued)
# (b) Financial risk management objectives and policies (Continued)
# Liquidity risk
Ultimate responsibility for liquidity risk management rests with the Board. In the management of the liquidity risk, the Group monitors and maintains a level of cash and cash equivalents deemed adequate by the management to finance the Group’s operations and mitigate the effects of fluctuations in cash flows.
The Group is exposed to liquidity risk as the Group had net current liabilities of approximately HK\$226,539,000 (2015: HK\$461,585,000). The liquidity of the Group primarily depends on the future funding being available and the ability of the Group to meet its financial obligations as they fall due. Details of which are set out in Note 2 to the consolidated financial statements.
The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities. The table has been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay. The maturity dates for other non-derivative financial liabilities are based on the agreed repayment dates.
The table includes both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curve at the end of the reporting period.
In addition, the following table details the Group's liquidity analysis for its derivative financial instruments. The tables have been drawn up based on the undiscounted contractual net cash outflows on derivative instruments that settle on a net basis, and the undiscounted gross outflows on those derivatives that require gross settlement.
7. 金融工具（續）
(b) 財務風險管理目標及政策（續）
流動資金風險
流動資金風險管理由董事會最終負責，於管理流動資金風險時，本集團監控及維持管理層認為足夠之現金及現金等值水平，以向本集團之業務提供資金及減低現金流量波動之影響。
由於本集團錄得淨流動負債約226,539,000 港 元（ 二 零 一 五 年 ；461,585,000港元），故本集團承受流動資金風險。本集團的流動資金主要倚賴可動用未來資金及本集團於財務責任到期時履行財務責任的能力。有關詳情載於綜合財務報表附註2。
下表詳列本集團非衍生金融負債之餘下合約到期情況。下表乃基於金融負債之未折現現金流量而編製，其乃根據本集團可能需付款之最早日期分類。其他非衍生金融負債之到期日是根據協定還款日期而釐定。
下表載列利息及本金現金流量。若利息流量為浮息，則按報告期間結束時之孳息曲線而得出未折現金額。
此外，下表詳列本集團對其衍生金融工具的流動性分析。編製該表時乃基於按淨額基準結算的衍生工具的未貼現合約現金流出淨額，以及須按總額結算的衍生工具的非貼現流出總額計算。 |
11695155_161.pdf | en | # 7. FINANCIAL INSTRUMENTS (Continue)
# (b) Financial risk management objectives and policies (Continued)
# Liquidity risk (Continued)
# Liquidity tables
7. 金融工具（續）
(b) 財務風險管理目標及政策（續）
流動資金風險（續）
流動資金表
<table><tr><td></td><td>Weihgted
average
interest rate
加權
平均利率</td><td>On demand
or less than
1 year
按要求
或一年內</td><td> 1-2 years
一年
至兩年</td><td> 2-5 years
兩年
至五年</td><td>Total
undiscounted
cash flow
未折現現金
流量總額</td><td>Carriyng
amounts
賬面值</td></tr><tr><td></td><td>%
%</td><td>HK$’000
千港元</td><td> HK$’000
千港元</td><td> HK$’000
千港元</td><td> HK$’000
千港元</td><td> HK$’000
千港元</td></tr><tr><td>2016 二零一六年</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Non-derivative financial liabilities 非衍生金融負債</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Trade and other payables 貿易及其他應付款項</td><td>–</td><td>116,605</td><td>–</td><td>–</td><td>116,605</td><td>116,605</td></tr><tr><td>Other borrowings 其他借貸</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– interest free －免息</td><td>–</td><td>25,700</td><td>–</td><td>–</td><td>25,700</td><td>25,700</td></tr><tr><td>– fixed rate －定息</td><td>10.00</td><td>4,948</td><td>–</td><td>–</td><td>4,948</td><td>4,800</td></tr><tr><td>– variable rate －浮息</td><td>3.82</td><td>41,528</td><td>–</td><td>–</td><td>41,528</td><td>40,000</td></tr><tr><td>Obligations under finance leases 融資租賃承擔</td><td>1.45</td><td>601</td><td>601</td><td>289</td><td>1,491</td><td>1,439</td></tr><tr><td>Convertible bonds 可換股債券</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– debt component －債務部分</td><td>15.21</td><td>112,997</td><td>–</td><td>–</td><td>112,997</td><td>97,781</td></tr><tr><td></td><td></td><td>302,379</td><td>601</td><td>289</td><td>303,269</td><td>286,325</td></tr><tr><td>2015 二零一五年</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Non-derivative financial liabilities 非衍生金融負債</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Trade and other payables 貿易及其他應付款項</td><td>–</td><td>96,565</td><td>–</td><td>–</td><td>96,565</td><td>96,565</td></tr><tr><td>Other borrowings 其他借貸</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– interest free －免息</td><td>–</td><td>25,700</td><td>–</td><td>–</td><td>25,700</td><td>25,700</td></tr><tr><td>– fixed rate －定息</td><td>10.00</td><td>3,620</td><td>–</td><td>–</td><td>3,620</td><td>3,500</td></tr><tr><td>– variable rate －浮息</td><td>3.20</td><td>40,839</td><td>–</td><td>–</td><td>40,839</td><td>40,000</td></tr><tr><td>Obligations under finance leases 融資租賃承擔</td><td>2.59</td><td>668</td><td>668</td><td>980</td><td>2,316</td><td>2,196</td></tr><tr><td>Convertible bonds 可換股債券</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– debt component －債務部分</td><td>–</td><td>325,307</td><td>–</td><td>–</td><td>325,307</td><td>325,307</td></tr><tr><td>Promissory notes payable 應付承兌票據</td><td>13.70</td><td>–</td><td>24,000</td><td>–</td><td>24,000</td><td>18,925</td></tr><tr><td></td><td></td><td>492,699</td><td>24,668</td><td>980</td><td>518,347</td><td>512,193</td></tr><tr><td>Derivatives – net settlement 衍生工具－以淨額結算
– Derivative financial liability －衍生金融負債</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>17,785</td></tr></table>
The amounts included above for variable interest rate instruments for non-derivative financial liabilities are subject to change if changes in variable interest rates differ to those estimates of interest rates determined at the end of the reporting period.
上文就非衍生金融負債之浮動利率工具包括之金額，會因浮動利率變動有別於報告期間結算日所釐定估計而有變。 |
11773765_123.pdf | en | # 29. SIGNIFICANT RELATED PARTY TRANSACTIONS (CONTINUED)
The remuneration of Directors and other members of key management of the Group and of the Company are as follows:
<table><tr><td rowspan="3"></td><td colspan="2">Group</td><td colspan="2">Company</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>RM’000</td><td>RM’000</td><td>RM’000</td><td>RM’000</td></tr><tr><td>Short-term employee benefits</td><td>4,944</td><td>5,906</td><td>1,485</td><td>2,242</td></tr><tr><td>Post-employment benefits</td><td>245</td><td>324</td><td>15</td><td>41</td></tr><tr><td></td><td>5,189</td><td>6,230</td><td>1,500</td><td>2,283</td></tr><tr><td>Analysed into:</td><td></td><td></td><td></td><td></td></tr><tr><td>- Directors of the Company</td><td>1,500</td><td>2,283</td><td>1,500</td><td>2,283</td></tr><tr><td>- Directors of the subsidiaries</td><td>1,286</td><td>1,608</td><td>-</td><td>-</td></tr><tr><td>- Other key management personnel</td><td>2,403</td><td>2,339</td><td>-</td><td>-</td></tr><tr><td></td><td>5,189</td><td>6,230</td><td>1,500</td><td>2,283</td></tr></table>
# 30. COMMITMENTS
# 30.1 Capital commitments
As at the end of the reporting period, the Group had the following capital commitments:
<table><tr><td rowspan="3"></td><td colspan="2">Group</td></tr><tr><td>30.9.2019</td><td>30.9.2018</td></tr><tr><td>RM’000</td><td>RM’000</td></tr><tr><td>Contracted but not provided for:</td><td></td><td></td></tr><tr><td>Construction of a factory</td><td>8,536</td><td>80,818</td></tr><tr><td>Renovation, purchase of plant and equipment</td><td>52,811</td><td>43,663</td></tr><tr><td></td><td>61,347</td><td>124,481</td></tr></table>
# 30.2 Operating lease commitments – as lessee
As at the end of the reporting period, there were operating lease commitments for rental payable in subsequent accounting periods as follows:
<table><tr><td rowspan="3"></td><td colspan="2">Group</td></tr><tr><td>30.9.2019</td><td>30.9.2018</td></tr><tr><td>RM’000</td><td>RM’000</td></tr><tr><td>Within one year</td><td>25,462</td><td>23,218</td></tr><tr><td>Two to five years</td><td>16,087</td><td>23,334</td></tr><tr><td>More than five years</td><td>-</td><td>2,989</td></tr><tr><td></td><td>41,549</td><td>49,541</td></tr></table> |
11773765_124.pdf | en | # 30. COMMITMENTS (CONTINUED)
# 30.2 Operating lease commitments – as lessee (Continued)
As at the end of the reporting period, the Group leases office premises and other operating facilities under operating leases. Leases are negotiated and rentals are fixed for a period of 1 to 5 years (30 September 2018: 1 to 10 years) with an option to renew at the prevailing market rates. Apart from the above lease commitment, the Group is required to pay contingent rentals based on percentage of sales derived from the operations for certain rented premises.
# 30.3 Operating lease commitments – as lessor
As at the end of the reporting period, there were non-cancellable operating lease commitments for rental receivable for premises in subsequent accounting periods as follows:
<table><tr><td rowspan="3"></td><td colspan="2">Group</td></tr><tr><td>30.9.2019</td><td>30.9.2018</td></tr><tr><td>RM’000</td><td>RM’000</td></tr><tr><td>Within one year</td><td>1,585</td><td>366</td></tr><tr><td>Two to three years</td><td>366</td><td>-</td></tr><tr><td></td><td>1,951</td><td>366</td></tr></table>
The above lease agreements expire within 1 to 2 year expiring in 2020 (30 September 2018: within 1 year expiring in 2018). The current rent receivables under the leases are subject to revision after expiry with no provisions for contingent rent.
Upon expiry of the lease term, the lessee is granted an option to renew the tenancy for two years subject to compliance and observation of all the terms and conditions in the tenancy agreements. |
11787558_24.pdf | en | \[ \left( v ^ { \alpha _ { n } } ( x ) - v ^ { \alpha _ { n } } ( x _ { 0 } ) \right) \to v ( x ) \]
for all \( x \in \mathcal { X } \), for some \( \lambda \in \mathbb { R } \) and some function \( v : \mathcal { X } \rightarrow \mathbb { R } \). Note that \|λ\|and \|v(·)\| are both bounded by \( C ^ { \prime } \). Finally, we notice that, for any \( x \in \mathcal { X } \),
\[ \alpha _ { n } v ^ { \alpha _ { n } } ( x ) = \alpha _ { n } v ^ { \alpha _ { n } } ( x _ { 0 } ) + \alpha _ { n } \bigl ( v ^ { \alpha _ { n } } ( x ) - v ^ { \alpha _ { n } } ( x _ { 0 } ) \bigr ) \to \lambda , \]
so the convergence of this sequence to \( \lambda \) holds for all x.
We are now in a position to prove existence of solutions to our Ergodic BSDE.
Theorem 4.4. Let v and \( \lambda \) be as constructed in Lemma 4.3. The triple \( ( Y , Z , \lambda ) \), where
\[ Y _ { t } : = v ( X _ { t } ) , \qquad e _ { k } ^ { * } Z _ { t } : = v ( e _ { k } ) . \]
is the unique bounded, stationary (i.e. does not depend on t), Markovian solution, with \( v ( x _ { 0 } ) = 0 \), to the Ergodic BSDE
\[ Y _ { T } = Y _ { t } - \sum _ { t \le u < T } \left( f ( X _ { u } , Z _ { u } ) - \lambda \right) + \sum _ { t \le u < T } Z _ { u } ^ { * } M _ { u + 1 } . \eqno ( 4 . 4 ) \]
Any other bounded solution \( ( Y ^ { \prime } , Z ^ { \prime } , \lambda ^ { \prime } ) \) satisfies \( \lambda \ = \ \lambda ^ { \prime } \), and any other bounded, stationary, Markovian solution \( ( \dot { Y } ^ { \prime } , Z ^ { \prime } , \lambda ^ { \prime } ) \) satisfies \( Y _ { t } \, = \, Y _ { t } ^ { \prime } + c \) for some \( c \in \mathbb { R } \), and \( Z \sim _ { M } Z ^ { \prime } \) 0.
Proof. Let \( \{ \alpha _ { n } \} _ { n > 1 } \) be the sequence constructed in Lemma 4.3. We have that \( Y _ { t } ^ { \alpha _ { n } } = v ^ { \alpha _ { n } } ( X _ { t } ) \) and \( e _ { k } ^ { * } Z _ { t } ^ { \alpha _ { n } } = v ^ { \alpha _ { n } } ( e _ { k } ) \) solve the discounted BSDE
\[ Y _ { T } ^ { \alpha _ { n } } = Y _ { t } ^ { \alpha _ { n } } - \sum _ { t \leq u < T } \left( f ( X _ { u } , Z _ { u } ^ { \alpha _ { n } } ) - \alpha _ { n } Y _ { u } ^ { \alpha _ { n } } \right) + \sum _ { t \leq u < T } \left( Z _ { u } ^ { \alpha _ { n } } \right) ^ { * } M _ { u + 1 } . \]
However, since \( \| \mathbf { 1 } \| _ { M _ { t + 1 } } = 0 \), and f does not distinguish between values of \( Z _ { u } \) up to equivalence \( { \sim } { M } _ { u + 1 } \) , we can equally write \( Z _ { u } ^ { \alpha _ { n } } - v ^ { \alpha _ { n } } ( x _ { 0 } ) \mathbf { 1 } \) in the place of \( Z _ { u } ^ { \alpha _ { n } } \) in the above. Note that \( e _ { k } ^ { * } Z _ { u } ^ { \alpha _ { n } } - v ^ { \alpha _ { n } } ( x _ { 0 } ) \to e _ { k } ^ { * } Z _ { u } \) as \( n \to \infty \) for each \( e _ { k } \in \mathcal { X } \), and that, by the bound established in Lemma 4.3, \|e∗kZuαn −vαn(x0)\|is uniformly bounded. Since f is Lipschitz in z, we deduce that
\[ f ( X _ { u } , Z _ { u } ^ { \alpha _ { n } } - v ^ { \alpha _ { n } } ( x _ { 0 } ) \mathbf { 1 } ) \to f ( X _ { u } , Z _ { u } ) \quad { \mathrm { a s } } \quad n \to \infty \quad { \mathrm { a . s . } } \]
It follows that |
11787558_25.pdf | en | \[ \begin{array} { l } { { \displaystyle Y _ { T } = \operatorname* { l i m } _ { n \to \infty } \left( v ^ { \alpha _ { n } } ( X _ { T } ) - v ^ { \alpha _ { n } } ( x _ { 0 } ) \right) } } \\ { { \displaystyle \quad = \operatorname* { l i m } _ { n \to \infty } \left( v ^ { \alpha _ { n } } ( X _ { t } ) - v ^ { \alpha _ { n } } ( x _ { 0 } ) \right) - \operatorname* { l i m } _ { n \to \infty } \displaystyle \sum _ { t \leq u < T } \left( f ( X _ { u } , Z _ { u } ^ { \alpha _ { n } } ) - \alpha _ { n } v ^ { \alpha _ { n } } ( X _ { u } ) \right) } } \\ { { \displaystyle \qquad + \operatorname* { l i m } _ { n \to \infty } \displaystyle \sum _ { t \leq u < T } \left( Z _ { u } ^ { \alpha _ { n } } \right) ^ { * } M _ { u + 1 } } } \\ { { \displaystyle \qquad = v ( X _ { t } ) - \operatorname* { l i m } _ { n \to \infty } \displaystyle \sum _ { t \leq u < T } \left( f ( X _ { u } , Z _ { u } ^ { \alpha _ { n } } - v ^ { \alpha _ { n } } ( x _ { 0 } ) \mathbf { 1 } ) - \alpha _ { n } v ^ { \alpha _ { n } } ( X _ { u } ) \right) } } \\ { { \displaystyle \qquad + \operatorname* { l i m } _ { n \to \infty } \displaystyle \sum _ { t \leq u < T } \left( Z _ { u } ^ { \alpha _ { n } } - v ^ { \alpha _ { n } } ( x _ { 0 } ) \mathbf { 1 } \right) ^ { * } M _ { u + 1 } } } \\ { { \displaystyle \qquad = Y _ { t } - \displaystyle \sum _ { t \leq u < T } \left( f ( X _ { u } , Z _ { u } ) - \lambda \right) + \displaystyle \sum _ { t \leq u < T } Z _ { u } ^ { * } M _ { u + 1 } , } } \end{array} \]
and we see that \( ( Y , Z , \lambda ) \) is indeed a solution of the EBSDE (4.4).
Suppose that \( ( Y ^ { \prime } , Z ^ { \prime } , \lambda ^ { \prime } ) \) is another bounded solution. Let \( \tilde { Y } \, = \, Y \, - \, Y ^ { \prime } \),\( \tilde { Z } = Z - Z ^ { \prime } \) and \( \tilde { \lambda } = \lambda - \lambda ^ { \prime } \). Then
\[ \tilde { Y } _ { T } = \tilde { Y } _ { 0 } - \sum _ { 0 \leq u < T } \left( f ( X _ { u } , Z _ { u } ) - f ( X _ { u } , Z _ { u } ^ { \prime } ) - \tilde { \lambda } \right) + \sum _ { 0 \leq u < T } \tilde { Z } _ { u } ^ { \ast } M _ { u + 1 } . \qquad ( 4 . 5 ) \]
By Proposition 2.2, there exists a measure Q such that
\[ - \sum _ { 0 \leq u < t } \left( f ( X _ { u } , Z _ { u } ) - f ( X _ { u } , Z _ { u } ^ { \prime } ) \right) + \sum _ { 0 \leq u < t } \tilde { Z } _ { u } ^ { \ast } M _ { u + 1 } \]
is a martingale under Q. Taking an \( \mathbb { E } _ { \mathbb { Q } } \) expectation in (4.5), we obtain
\[ \begin{array} { r } { \tilde { \lambda } = T ^ { - 1 } \mathbb { E } _ { \mathbb { Q } } \big [ \tilde { Y } _ { T } - \tilde { Y } _ { 0 } \big ] . } \end{array} \]
Since \( \tilde { Y } \) is uniformly bounded, taking the limit \( T \to \infty \) gives \( \tilde { \lambda } \) = 0, so that \( \lambda = \lambda ^ { \prime } \). Substituting back into (4.5) and taking an \( \mathbb { E } _ { \mathbb { O } } [ \, \cdot \, | \, \mathcal { F } _ { 0 } ] \)] expectation gives
\[ \mathbb { E } _ { \mathbb { Q } } { \left[ \tilde { Y } _ { T } \mid \mathcal { F } _ { 0 } \right] } = \tilde { Y } _ { 0 } . \eqno ( 4 . 6 ) \]
Suppose further that \( Y ^ { \prime } \) and \( Z ^ { \prime } \) are Markovian and do not depend on t, so that in particular there exists a function \( v ^ { \prime } : \mathcal { X } \rightarrow \mathbb { R } \) such that \( Y _ { t } ^ { \prime } \, = \, v ^ { \prime } ( X _ { t } ) \). Then the measure Q may be taken to be the measure given by Lemma 4.1, so that X is still a uniformly ergodic Markov chain under Q. Writing \( \tilde { \pi } \) for the ergodic measure of X under Q, it follows from (4.6) that, for any \( x \in \mathcal { X } \),
\[ v ( x ) - v ^ { \prime } ( x ) = \operatorname* { l i m } _ { T \to \infty } \mathbb { E } _ { \mathbb { Q } } \big [ \tilde { Y } _ { T } \, \big | \, X _ { 0 } = x \big ] = \int _ { \mathcal { X } } \big ( v ( y ) - v ^ { \prime } ( y ) \big ) d \tilde { \pi } ( y ) . \]
Since the right hand side is independent of x, we see that \( v ( x ) = v ^ { \prime } ( x ) + c \) for all x, and hence that \( Y _ { t } = Y _ { t } ^ { \prime } + c \), for some \( c \in \mathbb { R } \). In particular, if \( v ^ { \prime } ( x _ { 0 } ) = 0 \), then \( c \) = 0, and hence \( Y = Y ^ { \prime } \) up to indistinguishability.
With \( \tilde { \lambda } \) = 0 and \( \tilde { Y } _ { t } = c = \tilde { Y } _ { t + 1 } \), we deduce from the one-step dynamics of \( \tilde { Y } \) that \( \tilde { Z } _ { t } ^ { * } M _ { t + 1 } = 0 , \) and hence that \( Z \sim _ { M } Z ^ { \prime } \). |
9322382_152.pdf | en | Summer Universiade (2011年世界大學生夏季運動會) in Shenzhen, the 12th National Games of the PRC (中華人民共和國第十二屆運動會) in Liaoning province in 2013, the 2014 Youth Olympic Games in Nanjing and the 1st National Youth Games of the PRC(第一届全國青年運動會) in Fujian province in 2015. According to the Frost & Sullivan Report, our live sports broadcasting services were ranked second with a 25.0% market share in China in terms of revenue in 2015. In 2013, 2014 and 2015, the revenue we derived from live sports broadcasting service was approximately RMB20.3 million, RMB9.1 million and RMB14.0 million, respectively, representing approximately 4.0%, 2.2% and 2.3%, respectively, of our total revenue for the same periods.
• Graphics template design. We provide standard templates for TV programs, such as score-displaying graphics for sports game shows, as part of our graphics creation system product and our solutions containing this product. Some customers engage us to design or customize graphics templates for their digital video programs when these standard templates are insufficient to meet their needs.
• Digitization and cataloging of media asset. We use our media asset management products and solutions to help TV broadcasters digitize and catalog their analog media content on project-by-project basis. We have also started serving other types of customers such as publishers and archives to digitize their collections of paper-based documents.
• System maintenance. We provide long-term, on-site system maintenance services on project-by-project basis to customers who have installed our solutions. When providing these services, we are able to uncover opportunities to improve our solutions and products and help customers uncover their potential need for system expansion, upgrades and additional solutions and products.
The following illustrates our selected services described above. |
9322382_153.pdf | en | # Our Products
Our products combine our proprietary software with third-party hardware configured to our specifications to help our customers process digital video content after its capture and ingestion. Our products focus on providing certain key functionalities of digital video post-production, and primarily include:
• Video editing systems that edit digital video of news, advertisements, channel labels, banners and captions. The video editing system is one of our principal products and a key component in many of our solutions. Our Himalaya-series video editing systems are able to address our customers’ technological needs at various levels, ranging from sophisticated, high-end editing to entry-level, basic editing. Our video editing systems support real-time editing, multi-format video editing, integrated subtitle editing, special video and audio effects management, and have a user-friendly editing interface and numerous other features.
• Graphics creation systems that generate graphics and texts and integrate them into news, sports broadcasting, weather forecasts, TV shows and other TV programs and movies. Our Mariana-series graphics creation systems offer high-performance and real-time text and graphic rendering capability, easy-to-use editing and playback features and tools to allow for independent creations of a wide variety of TV shows that are well-suited to meet the demands of professional broadcasters today. According to the Frost & Sullivan Report, Mariana-series is the first domestically developed graphics creation system in China. We have also recently developed a meteorological graphics system under the brand “Tianmu”(“天目”) that we market to local government meteorological bureaus. To meet the demand of professional meteorology broadcasting, Tianmu offers its users the ability to quickly store and integrate real-time weather data from the source and accurately generate a rich array of texts, images and 3D animations to simulate and present various kinds of climate and weather effects for our customers. According to the Frost & Sullivan Report, our graphics creation systems had an industry-leading market share of 25.2% in China in terms of 2015 revenue. In 2013, 2014 and 2015, the revenue we derived from the sale of our graphics creation systems was approximately RMB35.8 million, RMB26.1 million and RMB38.2 million, respectively, representing approximately 7.1%, 6.4% and 6.3%, respectively, of our total revenue for the same periods.
• Visual effects and video compositing systems that edit and compose video content during post- production to create special visual effects such as motion detection and tracking, color correction and 3D-space compository. In 2010, we launched our Dunhuang-series visual effects and video compositing system, which is the first domestically developed system of its kind in China according to the Frost & Sullivan Report. Compared to traditional video editing systems, the Dunhuang-series has a more comprehensive and advanced set of functions targeting more sophisticated, high-end customers. |
3448981_107.pdf | en | # 4. SEGMENT INFORMATION
The Group has three reportable segments. The segments are managed separately as each business offers different products or provides different services and requires different business strategies.
The following summary describes the operations in each of the Group’s reportable segments:
<table><tr><td>QR code business segment</td><td>— Provision of QR code on product packaging and solutions and advertising
display services</td></tr><tr><td>Packaging products segment</td><td>— Manufacture and sale of watch boxes, jewellery boxes, eyewear cases, bags
and pouches and display units</td></tr><tr><td>Treasury investment segment</td><td>— Investments and trading in securities and money lending</td></tr></table>
Management monitors the results of the Group’s operating segments separately for the purpose of making decisions about resources allocation and performance assessment. Segment performance is evaluated based on reportable segment profit or loss, which is a measure of adjusted profit or loss before tax. The adjusted profit or loss before tax is measured consistently with the Group’s profit or loss before tax except that finance costs, share of results of a joint venture and an associate and head office and corporate income and expenses are excluded from such measurement.
There was no inter-segment sale or transfer during the year (2017: Nil). Central revenue and expenses are not allocated to the operating segments as they are not included in the measure of the segments’ results that is used by the chief operating decision makers for assessment of segment performance. |
3448981_108.pdf | en | # 4. SEGMENT INFORMATION (Continued)
<table><tr><td rowspan="3"></td><td colspan="2">QR code business</td><td colspan="2">Packaging products</td><td colspan="2">Treasury investment</td><td colspan="2">Total</td></tr><tr><td>2018</td><td>2017</td><td>2018</td><td>2017</td><td>2018</td><td>2017</td><td>2018</td><td>2017</td></tr><tr><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Gr’oups revenue</td><td>73,405</td><td>78,791</td><td>276,225</td><td>318,656</td><td>447</td><td>500</td><td>350,077</td><td>397,947</td></tr><tr><td>Fair value losses on financial
assets at fair value through
profit or loss held for trading,
net</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(1,307)</td><td>(80,248)</td><td>(1,307)</td><td>(80,248)</td></tr><tr><td>Segment revenue</td><td>73,405</td><td>78,791</td><td>276,225</td><td>318,656</td><td>(860)</td><td>(79,748)</td><td>348,770</td><td>317,699</td></tr><tr><td>Segment results</td><td>(195,734)</td><td>(157,723)</td><td>8,423</td><td>25,947</td><td>(890)</td><td>(79,874)</td><td>(188,201)</td><td>(211,650)</td></tr><tr><td>Corporate and unallocated
income, gains and losses</td><td></td><td></td><td></td><td></td><td></td><td></td><td>5,696</td><td>(5,978)</td></tr><tr><td>Corporate and unallocated
expenses</td><td></td><td></td><td></td><td></td><td></td><td></td><td>(34,957)</td><td>(28,656)</td></tr><tr><td>Share of result of a joint venture</td><td></td><td></td><td></td><td></td><td></td><td></td><td>19</td><td>2,990</td></tr><tr><td>Share of result of an associate</td><td></td><td></td><td></td><td></td><td></td><td></td><td>7,276</td><td>–</td></tr><tr><td>Finance costs</td><td></td><td></td><td></td><td></td><td></td><td></td><td>(41,807)</td><td>(5,693)</td></tr><tr><td>Loss before tax</td><td></td><td></td><td></td><td></td><td></td><td></td><td>(251,974)</td><td>(248,987)</td></tr></table>
<table><tr><td rowspan="3"></td><td colspan="2">QR code business</td><td colspan="2">Packaging products</td><td colspan="2">Treasury investment</td><td colspan="2">Total</td></tr><tr><td>2018</td><td>2017</td><td>2018</td><td>2017</td><td>2018</td><td>2017</td><td>2018</td><td>2017</td></tr><tr><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Other segment information:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Capital expenditure</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– operating segment</td><td>44,935</td><td>51,379</td><td>39</td><td>3,662</td><td>–</td><td>–</td><td>44,974</td><td>55,041</td></tr><tr><td>– unallocated</td><td></td><td></td><td></td><td></td><td></td><td></td><td>13</td><td>25</td></tr><tr><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td>44,987</td><td>55,066</td></tr><tr><td>Interest income</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– operating segment</td><td>849</td><td>160</td><td>28</td><td>46</td><td>–</td><td>–</td><td>877</td><td>206</td></tr><tr><td>– unallocated</td><td></td><td></td><td></td><td></td><td></td><td></td><td>10,610</td><td>2</td></tr><tr><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td>11,487</td><td>208</td></tr><tr><td>Depreciation</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– operating segment</td><td>18,941</td><td>7,422</td><td>1,719</td><td>1,518</td><td>–</td><td>–</td><td>20,660</td><td>8,940</td></tr><tr><td>– unallocated</td><td></td><td></td><td></td><td></td><td></td><td></td><td>9</td><td>10</td></tr><tr><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td>20,669</td><td>8,950</td></tr><tr><td>Amortisation</td><td>7,838</td><td>435</td><td>–</td><td>–</td><td>–</td><td>–</td><td>7,838</td><td>435</td></tr><tr><td>Loss/(gain) on disposal of
property, plant and equipment</td><td>2,385</td><td>1,633</td><td>–</td><td>(190)</td><td>–</td><td>–</td><td>2,385</td><td>1,443</td></tr><tr><td>Impairment of property,
plant and equipment</td><td>40,718</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>40,718</td><td>–</td></tr><tr><td>Impairment loss of
trade receivables, net</td><td>2,016</td><td>17</td><td>–</td><td>49</td><td>–</td><td>–</td><td>2,016</td><td>66</td></tr><tr><td>Impairment loss of goodwill</td><td>37,023</td><td>104,664</td><td>–</td><td>–</td><td>–</td><td>–</td><td>37,023</td><td>104,664</td></tr></table> |
2122297_75.pdf | en | 31.1 Certification by Jeffrey A. Stoops, Chief Executive Officer, pursuant to Section 302 of the SarbanesOxley Act of 2002.\*
31.2 Certification by Brendan T. Cavanagh, Chief Financial Officer, pursuant to Section 302 of the SarbanesOxley Act of 2002.\*
32.1 Certification by Jeffrey A. Stoops, Chief Executive Officer, pursuant to Section 906 of the SarbanesOxley Act of 2002. \*\*
32.2 Certification by Brendan T. Cavanagh, Chief Financial Officer, pursuant to Section 906 of the SarbanesOxley Act of 2002. \*\*
101.INS XBRL Instance Document.\*
101.SCH XBRL Taxonomy Extension Schema Document.\*
101.DEF XBRL Taxonomy Extension Definition Linkbase Document.\*
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.\*
101.LAB XBRL Taxonomy Extension Label Linkbase Document.\*
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.\*
† Management contract or compensatory plan or arrangement.
\* Filed herewith.
\*\* Furnished herewith.
# ITEM 16. FORM 10K SUMMARY
None. |
2122297_76.pdf | en | # SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
SBA COMMUNICATIONS
CORPORATION
By:/s/ Jeffrey A. Stoops
Jeffrey A. Stoops
Chief Executive Of icer and
President
Date: March 1, 2018
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
<table><tr><td>Signature</td><td>Title</td><td>Date</td></tr><tr><td>/s/ Steven E. Bernstein
Steven E. Bernstein</td><td>Chairman of the Board of Directors</td><td>March 1, 2018</td></tr><tr><td>/s/ Jeffrey A. Stoops
Jeffrey A. Stoops</td><td>Chief Executive Officer and President
(Principal Executive Officer)</td><td>March 1, 2018</td></tr><tr><td>/s/ Brendan T. Cavanahg
Brendan T. Cavanahg</td><td>Chief Financial Officer and Executive Vice President
(Principal Financial Officer)</td><td>March 1, 2018</td></tr><tr><td>/s/ Brian D. Lazarus
Brian D. Lazarus</td><td>Chief Accounting Officer and Senior Vice President
(Principal Accounting Officer)</td><td>March 1, 2018</td></tr><tr><td>/s/ Brian C. Carr
Brian C. Carr</td><td>Director</td><td>March 1, 2018</td></tr><tr><td>/s/ Mary S. Chan
Mary S. Chan</td><td>Director</td><td>March 1, 2018</td></tr><tr><td>/s/ Duncan H. Cocroft
Duncan H. Cocroft</td><td>Director</td><td>March 1, 2018</td></tr><tr><td>/s/ George R. Krouse Jr.
George R. Krouse Jr.</td><td>Director</td><td>March 1, 2018</td></tr><tr><td>/s/ Jack Langer
Jack Langer</td><td>Director</td><td>March 1, 2018</td></tr><tr><td>/s/ Kevin L. Beebe
Kevin L. Beebe</td><td>Director</td><td>March 1, 2018</td></tr></table> |
2124358_44.pdf | en | # Genuine Parts Company and Subsidiaries
Consolidated Statements of Income and Comprehensive Income
<table><tr><td rowspan="3"></td><td colspan="3">Year Ended December 31</td></tr><tr><td>2017</td><td>2016</td><td>2015</td></tr><tr><td colspan="3">(In Thousands, Except per Share Amounts)</td></tr><tr><td>Net sales</td><td>$ 16,308,801</td><td>$ 15,339,713</td><td>$ 15,280,044</td></tr><tr><td>Cost of goods sold</td><td>11,402,403</td><td>10,740,106</td><td>10,724,192</td></tr><tr><td>Gross marign</td><td>4,906,398</td><td>4,599,607</td><td>4,555,852</td></tr><tr><td>Operating expenses:</td><td></td><td></td><td></td></tr><tr><td>Selling, administrative, and other expenses</td><td>3,705,136</td><td>3,370,833</td><td>3,277,390</td></tr><tr><td>Depreciation and amortization</td><td>167,691</td><td>147,487</td><td>141,675</td></tr><tr><td>Provision for doubtful accounts</td><td>13,932</td><td>11,515</td><td>12,373</td></tr><tr><td>Total operating expenses</td><td>3,886,759</td><td>3,529,835</td><td>3,431,438</td></tr><tr><td>Nonoperating expenses (income) :</td><td></td><td></td><td></td></tr><tr><td>Interest expense</td><td>41,486</td><td>21,084</td><td>21,662</td></tr><tr><td>Other</td><td>(31,115)</td><td>(25,652)</td><td>(20,929)</td></tr><tr><td>Total nonoperating expenses (income)</td><td>10,371</td><td>(4,568)</td><td>733</td></tr><tr><td>Income before income taxes</td><td>1,009,268</td><td>1,074,340</td><td>1,123,681</td></tr><tr><td>Income taxes</td><td>392,511</td><td>387,100</td><td>418,009</td></tr><tr><td>Net income</td><td>$ 616,757</td><td>$ 687,240</td><td>$ 705,672</td></tr><tr><td>Basic net income per common share</td><td>$ 4.19</td><td>$ 4.61</td><td>$ 4.65</td></tr><tr><td>Diluted net income per common share</td><td>$ 4.18</td><td>$ 4.59</td><td>$ 4.63</td></tr><tr><td>Weihgted average common shares outstanding</td><td>147,140</td><td>149,051</td><td>151,667</td></tr><tr><td>Dilutive effect of stock options and nonvested restricted stock awards</td><td>561</td><td>753</td><td>829</td></tr><tr><td>Weihgted average common shares outstandinilg — assuming dution</td><td>147,701</td><td>149,804</td><td>152,496</td></tr><tr><td>Net income</td><td>$ 616,757</td><td>$ 687,240</td><td>$ 705,672</td></tr><tr><td>Other comprehensive income (loss), net of tax:</td><td></td><td></td><td></td></tr><tr><td>Foreign currency translation adjustment</td><td>137,694</td><td>(8,957)</td><td>(207,986)</td></tr><tr><td>Net investment hedge, net of income taxes of 2017 — $9,711</td><td>(17,388)</td><td>—</td><td>—</td></tr><tr><td>Pension and postretirement benefit adjustments, net of income taxes of 2017
— ($20,539); 2016 — $50,144; 2015 — $5,335</td><td>40,123</td><td>(73,446)</td><td>(2,421)</td></tr><tr><td>Other comprehensive income (loss), net of tax</td><td>160,429</td><td>(82,403)</td><td>(210,407)</td></tr><tr><td>Comprehensive income</td><td>$ 777,186</td><td>$ 604,837</td><td>$ 495,265</td></tr></table>
See accompanying notes. |
2124358_45.pdf | en | # Genuine Parts Company and Subsidiaries
Consolidated Statements of Equity
(In Thousands, Except Share and per Share Amounts)
<table><tr><td></td><td colspan="2">Common Stock</td><td rowspan="2">Additional
PaidIn
Caiptal</td><td rowspan="2">Accumulated
Other
Comprehensive
Loss</td><td rowspan="2">Retained
Earnings</td><td rowspan="2">Total
Parent
Equity</td><td rowspan="2">Non-
controlling
Interests in
Subsidiaries</td><td rowspan="2">Total
Equity</td></tr><tr><td></td><td>Shares</td><td>Amount</td></tr><tr><td>Balance at January 1, 2015</td><td>153,113,042</td><td>$ 153,113</td><td>$ 26,414</td><td>$ (720,211)</td><td>$ 3,841,932</td><td>$ 3,301,248</td><td>$ 11,116</td><td>$ 3,312,364</td></tr><tr><td>Net income</td><td>—</td><td>—</td><td>—</td><td>—</td><td>705,672</td><td>705,672</td><td>—</td><td>705,672</td></tr><tr><td>Other comprehensive loss,
net of tax</td><td>—</td><td>—</td><td>—</td><td>(210,407)</td><td>—</td><td>(210,407)</td><td>—</td><td>(210,407)</td></tr><tr><td>Cash dividends declared,
$2.46 per share</td><td>—</td><td>—</td><td>—</td><td>—</td><td>(372,840)</td><td>(372,840)</td><td>—</td><td>(372,840)</td></tr><tr><td>Sharebased awards
exercised, including tax
benefit of $7,024</td><td>229,958</td><td>230</td><td>(2,778)</td><td>—</td><td>—</td><td>(2,548)</td><td>—</td><td>(2,548)</td></tr><tr><td>Sharebased compensation</td><td>—</td><td>—</td><td>17,717</td><td>—</td><td>—</td><td>17,717</td><td>—</td><td>17,717</td></tr><tr><td>Purchase of stock</td><td>(3,261,526)</td><td>(3,262)</td><td>—</td><td>—</td><td>(289,013)</td><td>(292,275)</td><td>—</td><td>(292,275)</td></tr><tr><td>Noncontrolling interest
activities</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>1,559</td><td>1,559</td></tr><tr><td>Balance at December 31, 2015</td><td>150,081,474</td><td>150,081</td><td>41,353</td><td>(930,618)</td><td>3,885,751</td><td>3,146,567</td><td>12,675</td><td>3,159,242</td></tr><tr><td>Net income</td><td>—</td><td>—</td><td>—</td><td>—</td><td>687,240</td><td>687,240</td><td>—</td><td>687,240</td></tr><tr><td>Other comprehensive loss,
net of tax</td><td>—</td><td>—</td><td>—</td><td>(82,403)</td><td>—</td><td>(82,403)</td><td>—</td><td>(82,403)</td></tr><tr><td>Cash dividends declared,
$2.63 per share</td><td>—</td><td>—</td><td>—</td><td>—</td><td>(391,852)</td><td>(391,852)</td><td>—</td><td>(391,852)</td></tr><tr><td>Sharebased awards
exercised, including tax
benefit of $12,021</td><td>340,703</td><td>341</td><td>(4,467)</td><td>—</td><td>—</td><td>(4,126)</td><td>—</td><td>(4,126)</td></tr><tr><td>Sharebased compensation</td><td>—</td><td>—</td><td>19,719</td><td>—</td><td>—</td><td>19,719</td><td>—</td><td>19,719</td></tr><tr><td>Purchase of stock</td><td>(2,011,755)</td><td>(2,012)</td><td>—</td><td>—</td><td>(179,405)</td><td>(181,417)</td><td>—</td><td>(181,417)</td></tr><tr><td>Noncontrolling interest
activities</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>953</td><td>953</td></tr><tr><td>Balance at December 31, 2016</td><td>148,410,422</td><td>148,410</td><td>56,605</td><td>(1,013,021)</td><td>4,001,734</td><td>3,193,728</td><td>13,628</td><td>3,207,356</td></tr><tr><td>Net income</td><td>—</td><td>—</td><td>—</td><td>—</td><td>616,757</td><td>616,757</td><td>—</td><td>616,757</td></tr><tr><td>Other comprehensive
income, net of tax</td><td>—</td><td>—</td><td>—</td><td>160,429</td><td>—</td><td>160,429</td><td>—</td><td>160,429</td></tr><tr><td>Cash dividends declared,
$2.70 per share</td><td>—</td><td>—</td><td>—</td><td>—</td><td>(396,891)</td><td>(396,891)</td><td>—</td><td>(396,891)</td></tr><tr><td>Sharebased awards
exercised, including tax
benefit of $3,134</td><td>131,232</td><td>132</td><td>(5,371)</td><td>—</td><td>—</td><td>(5,239)</td><td>—</td><td>(5,239)</td></tr><tr><td>Sharebased compensation</td><td>—</td><td>—</td><td>16,892</td><td>—</td><td>—</td><td>16,892</td><td>—</td><td>16,892</td></tr><tr><td>Purchase of stock</td><td>(1,889,039)</td><td>(1,889)</td><td>—</td><td>—</td><td>(171,635)</td><td>(173,524)</td><td>—</td><td>(173,524)</td></tr><tr><td>Noncontrolling interest
activities</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>38,376</td><td>38,376</td></tr><tr><td>Balance at December 31, 2017</td><td>146,652,615</td><td>$ 146,653</td><td>$ 68,126</td><td>$ (852,592)</td><td>$ 4,049,965</td><td>$ 3,412,152</td><td>$ 52,004</td><td>$ 3,464,156</td></tr></table>
See accompanying notes. |
2584206_95.pdf | en | # 18. FILM RIGHTS AND FILMS AND TV PROGRAMMES UNDER PRODUCTION (continued)
<table><tr><td rowspan="2"></td><td>Film and TV
programmes
rights</td><td>Films and TV
programmes
under
production</td><td>Total</td></tr><tr><td>HK$’000</td><td>HK$’000</td><td>HK$’000</td></tr><tr><td>31 December 2015</td><td></td><td></td><td></td></tr><tr><td>Cost:</td><td></td><td></td><td></td></tr><tr><td>At 1 January 2015</td><td>7,958</td><td>—</td><td>7,958</td></tr><tr><td>Additions</td><td>—</td><td>41,117</td><td>41,117</td></tr><tr><td>Disposals</td><td>(10,276)</td><td>—</td><td>(10,276)</td></tr><tr><td>Transfer to films and TV programmes rights</td><td>38,634</td><td>(38,634)</td><td>—</td></tr><tr><td>At 31 December 2015</td><td>36,316</td><td>2,483</td><td>38,799</td></tr><tr><td>Accumulated amortisation:</td><td></td><td></td><td></td></tr><tr><td>At 1 January 2015</td><td>7,366</td><td>—</td><td>7,366</td></tr><tr><td>Disposals</td><td>(7,366)</td><td>—</td><td>(7,366)</td></tr><tr><td>At 31 December 2015</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Carrying amount</td><td>36,316</td><td>2,483</td><td>38,799</td></tr></table>
For the purpose of impairment testing, film rights have been allocated to the cash generating unit of movies, TV programmes and internet contents operation.
In light of the circumstances of film industry, the Group regularly reviewed its library of film rights to assess the marketability of film rights and the corresponding recoverable amounts.
At 31 December 2016 and 2015, the directors of the Company believe that any reasonably possible change in the key assumptions on which the recoverable amounts would not cause the carrying amounts of the films and TV programmes rights exceed the aggregate recoverable amounts.
During the year ended 31 December 2016, there is an impairment loss of approximately HK\$6,004,000 recognised in respect of films and TV programmes under production, based on contractual cash flows less cost to sell which solely related to the Group’s TV programmes under production and distribution activities based in Mainland China. |
2584206_96.pdf | en | # 19. INVESTMENT IN FILM
During the year ended 31 December 2016, the Group has one (2015: Nil) film investment agreement at a total contract amount of HK\$16,750,000 (2015: Nil). The investment is governed by the relevant agreement entered into between the Group and the production house whereby the Group is entitled to a fixed rate of return at 15% per annum on the principal amount. Investment income of HK\$1,982,000 was recognised by the Group.
# 20. AMOUNTS DUE FROM RELATED COMPANIES
On 21 December 2015, Young Film Culture Media Company Limited (“Young Film”), a subsidiary of the Company, entered into a master services agreement (the “Master Services Agreement”) with青島年青時候影視文化傳媒有限公司 (Qingdao Young Times Video Cultural Media Company Limited) (“Qingdao Young Times”) which is controlled by Ms. Shang Na, a member of the key management personnel of the Group, pursuant to which Qingdao Young Times shall provide to Young Film services including the production and promotion of movies, TV dramas and programmes as requested by the Group for a term of three years from the date of the Master Services Agreement. The services under the Master Services Agreement shall be charged on a cost basis (as incurred by Qingdao Young Times). For more details of the Master Services Agreement, please refer to the announcement of the Company dated 21 December 2015.
As at 31 December 2016, included in amounts due from related companies was an amount of approximately HK\$45,440,000 (2015: HK\$24,000,000) advanced by the Group to Qingdao Young Times for the services under the Master Services Agreement.
# 21. PREPAYMENTS, DEPOSITS AND OTHER RECEIVABLES
<table><tr><td rowspan="2"></td><td>2016</td><td>2015</td></tr><tr><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Deposits</td><td>5,718</td><td>2,569</td></tr><tr><td>Prepayments</td><td>20,793</td><td>12,268</td></tr><tr><td>Other receivables</td><td>19,198</td><td>11,373</td></tr><tr><td>Impairment</td><td>(6,374)</td><td>—</td></tr><tr><td></td><td>39,335</td><td>26,210</td></tr></table>
As at 31 December 2016, except for fully impaired other receivables of HK\$6,374,000 (2015: Nil), none of the above assets is either past due or impaired. The financial assets included in the above balances relate to receivables for which there was no recent history of default. |
2531277_45.pdf | en | (4) to consider any significant or unusual items that are, or may need to be, reflected in the reports and accounts, it should give due consideration to any matters that have been raised by the Company’s staff responsible for the accounting and financial reporting function, compliance officer or auditors;
(5) to review the Company’s financial controls, and unless expressly addressed by a separate Board risk committee, or by the Board itself, to review the Company’s risk management and internal control systems;and
(6) to discuss the risk management and internal control systems with management to ensure that management has performed its duty to have effective systems.
The written terms of reference of the Audit Committee are available on the websites of the Stock Exchange and the Company.
From the Listing Date and up to 31 December 2017, two Audit Committee meetings were held. Save as Mr. Yang Zhongkai who only attended one meeting, all the members of the Audit Committee attended all two meetings. At the meetings, the Audit Committee reviewed the annual report for 2016 with external auditors, the interim results for 2017, the activities of the Group’s internal control functions and also reviewed and approved the arrangement of the annual audit work and then proposed the recommendations to the Board.
# Remuneration Committee
The Remuneration Committee comprises three members, including two independent non-executive Directors namely Mr. Yang Zhongkai (chairman), Mr. Shi Weixing and one executive Director namely Mr. Peng TB.
The principal duties of the Remuneration Committee include but not limited to the following:
1. to make recommendations to the Board on the Company’s policy and structure for all remuneration of the Directors and senior management and on the establishment of a formal and transparent procedure for developing policy on such remuneration;
2. to review and approve management’s remuneration proposals with reference to corporate goals and objectives of the Board;
3. to determine the remuneration packages of individual executive Directors and senior management. These include benefits in kind, pension rights and compensation payments, including any compensation payable for loss or termination of their office or appointment;
4. to make recommendations to the Board on the remuneration of non-executive Directors; |
2531277_46.pdf | en | 5. to consider salaries paid by comparable companies, time commitment and responsibilities and employment conditions elsewhere in the Group;
6. to review and approve compensation payable to executive Directors and senior management for any loss or termination of office or appointment to ensure that it is consistent with contractual terms and is otherwise fair and not excessive;
7. to review and approve compensation arrangements relating to dismissal or removal of Directors for misconduct to ensure that they are consistent with contractual terms and are otherwise reasonable and appropriate;
8. to ensure that no Director or any of his/her associates (as defined in the Listing Rules) is involved in deciding his/her own remuneration; and
9. to report back to the Board on their decisions or recommendation, unless there are legal or regulatory restrictions on their ability to do so (such as a restriction on disclosure due to regulatory requirements).
The written terms of reference of the Remuneration Committee are available on the websites of the Stock Exchange and the Company.
From the Listing Date and up to the year ended 31 December 2017, one Remuneration Committee meeting was held. Save as Mr. Yang Zhongkai, all the members of the Remuneration Committee attended the meeting. At the meeting, the Remuneration Committee reviewed remuneration of the Directors and senior management, and thought that the remunerations of whom were reasonable and appropriate.
# Nomination Committee
The Nomination Committee currently comprises three members, including two independent non-executive Directors namely Mr. Shi Weixing (chairman), Mr. Yang Zhongkai and one executive Director namely Mr. Peng YH.
The principal duties of the Nomination Committee include the following:
1. to review the structure, size and composition (including the skills, knowledge and experience) of the Board at least annually and make recommendations on any proposed changes to the Board to complement the Company’s corporate strategy;
2. to identify individuals suitably qualified to become Board members and select or make recommendations to the Board on the selection of individuals nominated for directorships;
3. to assess the independence of independent non-executive Directors;
4. to make recommendations to the Board on the appointment or reappointment of Directors and the succession planning for Directors, in particular the chairman and the chief executive officer; and
5. to review the Board diversity policy.
The Nomination Committee assesses the candidate or incumbent on criteria such as integrity, experience, skill and ability to commit time and effort to carry out the duties and responsibilities. The recommendations of the Nomination Committee will then be put to the Board for decision. The written terms of reference of the Nomination Committee are available on the websites of the Stock Exchange and the Company. |
20780351_314.pdf | en | # EXHIBIT A
# REGISTRATION RIGHTS
1. Applicability of Rights. The Holders (as defined below) shall be entitled to the following rights only with respect to any potential public offering of the Company’s Shares in the United States. The rights provided hereunder shall terminate with respect to any Holder, at the earlier of (a) eight years after the Company’s IPO and (b) if all Registrable Securities held by such Holder may then be sold without registration in any ninety (90) day period pursuant to Rule 144 promulgated under the Securities Act.
2. Definitions. In this Agreement, in addition to those defined in the context, the following expressions shall have the following meanings:
“ADSs” means American Depositary Shares representing the relevant number of the Company’s ordinary shares.
“Form F-3” mean such respective form under the Securities Act as is in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by the SEC which permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC.
“Holder” means any Person owning of record Registrable Securities that have not been sold to the public or pursuant to Rule 144 promulgated under the Securities Act or any permitted assignee of record of such Registrable Securities to whom rights under this Agreement have been duly assigned in accordance with this Agreement.
For purposes of this Section 2, “Holder”, the term “Holder” means any Person owning or having the rights to acquire Registrable Securities or any permitted assignee of record of such Registrable Securities to whom rights under this Section 2 have been duly assigned in accordance with this Agreement.
“register,” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement.
“Registrable Securities” means (1) any Ordinary Shares of the Company issued or to be issued pursuant to the conversion of any Preference Shares;(2) any Ordinary Shares of the Company issued or issuable upon the conversion or exercise of any warrant, right or other security which is issued as a dividend or other distribution with respect to, or in exchange for or in replacement of, any Preference Shares described in clause (1) of this definition; and (3) any other Ordinary Shares of the Company owned or hereafter acquired by holders of Preference Shares. Notwithstanding the foregoing, “Registrable Securities” shall exclude any Registrable Securities sold by a Person in a transaction in which rights under this Agreement are not assigned in accordance with this Agreement or any Registrable Securities sold in a public offering, whether sold pursuant to Rule 144 promulgated under the Securities Act, or in a registered offering, or otherwise. |
20780351_315.pdf | en | “Registrable Securities then outstanding” means the number of Ordinary Shares of the Company that are Registrable Securities and are then issued and outstanding or are issuable upon conversion of Preference Shares then issued and outstanding, or issuable upon conversion or exercise of any warrant, right or other security then outstanding.
“SEC” or “Commission” means the U.S. Securities and Exchange Commission.
# 3. Demand Registration.
(a) Request by Holders. If the Company shall at any time after the earlier of (i) the third (3rd) anniversary of the date of this Agreement and (ii) the expiry of six (6) months after a Qualified IPO receive a written request from the Holders of at least 15% of the Registrable Securities that the Company file a registration statement under the Securities Act covering the registration of Registrable Securities pursuant to this Section 3, then the Company shall, within ten (10) Business Days of the receipt of such written request, give written notice of such request (“Request Notice”) to all Holders, and use all reasonable efforts to effect, as soon as practicable, the registration under the Securities Act of all Registrable Securities that Holders (including other Shareholders who so) request to be registered and included in such registration by written notice given by such Holders to the Company within twenty (20) Business Days after receipt of the Request Notice, subject only to the limitations of this Section 3; provided that the Registrable Securities requested by all Holders to be registered pursuant to such request must have a market value in excess of US\$50,000,000 (or, in the case of an initial public offering, US\$200,000,000); provided, further, that the Company shall not be obligated to effect any such registration if the Company has, within the six (6) month period preceding the date of such request, already effected a registration under the Securities Act pursuant to this Section 3 or Section 5, or in which the Holders had an opportunity to participate pursuant to the provisions of Section 4, other than a registration from which the Registrable Securities of Holders have been excluded (with respect to all or any portion of the Registrable Securities the Holders requested be included in such registration) pursuant to the provisions of Section 4(a). |
8405455_13.pdf | en | # PRC GOVERNMENTAL AUSTERITY MEASURES IN THE PROPERTY MARKET
The PRC government has recently introduced certain new policies which are intended to control the substantial increases in property prices in the PRC. These policies can be classified into four categories: (i) restrictions on speculation activities of real estate developers; (ii) limitations on financing land grant consideration payment; (iii) restrictions on speculation activities of residential property buyers; and (iv) encouragement of the PRC government in the purchase of small-size units and construction of affordable housing. For details of the aforesaid regulations, please refer to the section headed “Regulation — Impact of the PRC Governmental Austerity Measures” in this prospectus.
Our Directors are of the view that these policies did not and would not have any material adverse impact on our business operations on the basis that (i) there was no adverse impact on the average contract prices for the pre-sale of our residential properties at Golden Wheel Star City and our commercial properties at Golden Wheel Time Square during the year ended 31 December 2011 and the six months ended 30 June 2012; (ii) we had not encountered any difficulty in obtaining bank loans during the year ended 31 December 2011 and the six months ended 30 June 2012; and (iii) the residential units within our integrated commercial projects are positioned for mass market home buyers in Jiangsu and Hunan provinces. As of 30 September 2012, approximately 29,347 sq.m., or 81%, of the total GFA available for sale of our residential properties (completed and under development) were categorized as small to medium-sized ordinary commodity houses under the relevant PRC laws and regulations, which will remain as our focus for residential property development. We believe this particular residential market segment has more stable and consistent demand, higher affordability attributable to a lower purchase price in our target markets as compared to luxury residential developments which target higher income households and property investors in these markets.
However, it is difficult to ascertain the full extent of the impact of these measures on the performance of our Group or to accurately estimate the sales volume and turnover of our Group as if such measures had not been introduced. Our Directors confirm that we had not experienced any material cancellation of sales during the Track Record Period and up to the Latest Practicable Date. As advised by our PRC legal advisors, Jun He Law Offices, there has been no material changes in the PRC laws and regulations, regardless at state level or in Nanjing, Yangzhou and Zhuzhou, in the recent months to increase regulation over pre-sale activities of property developers, or to tighten measures to limit bank financing including buying-off plan pre-financing.
# HISTORICAL NON-COMPLIANCE INCIDENTS
We failed to fully comply with certain applicable PRC laws and regulations, which had resulted in certain non-compliance incidents during the Track Record Period, including (i) late completion of Nanjing Jade Garden and Golden Wheel Star Plaza, (ii) delivery of certain property units of Golden Wheel Time Square before passing the construction completion examination, (iii) failure to complete lease registration for certain leased properties of Golden Wheel Time Square, (iv) failure to make housing fund contributions for certain employees, and (v) granting loans to Nanjing Golden Wheel Real Estate, our then related company (which became our wholly-owned subsidiary on 18 June 2012). We had rectified all the other non-compliance incidents as of the Latest Practicable Date, except for the late completion of Nanjing Jade Garden and Golden Wheel Star Plaza. As a result, we may be subject to a maximum fine of approximately RMB22.4 million and the relevant authorities may forfeit part of the land on which the constructions has not been completed by their respective deadlines without any payment to us. For details of the reasons for these non-compliance incidents and the corresponding remedial and preventive measures, please refer to the sections headed “Risk Factors — We may not be able to meet our project development schedules and complete our projects on time, or at all” and “Business — Regulatory Compliance” in this prospectus. |
8405455_14.pdf | en | # SUMMARY FINANCIAL INFORMATION
We maintained a profitable operation during the Track Record Period. In 2011, our net profit was RMB513.2 million, representing an increase of 74.9% from RMB293.4 million in 2010. We also had a prudent net debt to equity ratio of 15.0% as of 30 June 2012 as a result of our strict financial disciplines over all aspects of our operations from land acquisition to construction. We intend to continue maintaining a disciplined financial strategy.
The fair value gains of investment properties accounted for a substantial portion of our net profit during the Track Record Period, which may, however, fluctuate from time to time. For details, please refer to the section headed “Risk Factors — Fair value gains on our investment properties represented a substantial portion of our net profit during the Track Record Period, and the fair value of our investment properties is likely to fluctuate from time to time and may decrease significantly in the future, which may materially and adversely impact our profitability” in this prospectus.
# Selected Consolidated Statements of Comprehensive Income and Statements of Financial Position Line Items
<table><tr><td rowspan="4"></td><td colspan="3">Year ended 31 December</td><td colspan="2"> Six months ended 30 June</td></tr><tr><td>2009</td><td>2010</td><td>2011</td><td>2011</td><td>2012</td></tr><tr><td>RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td></tr><tr><td></td><td></td><td></td><td>(unaudited)</td><td></td></tr><tr><td>Revenue</td><td>493,800</td><td>483,524</td><td>524,495</td><td>167,230</td><td>662,351</td></tr><tr><td>Gross profit</td><td>206,154</td><td>140,992</td><td>241,061</td><td>70,068</td><td>321,781</td></tr><tr><td>Changes in fair value of investment properties</td><td>250,183</td><td>306,900</td><td>539,919</td><td>229,579</td><td>75,000</td></tr><tr><td>Profit and total comprehensive income attributable to:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Owners of the Company</td><td>263,403</td><td>280,744</td><td>498,488</td><td>187,892</td><td>198,767</td></tr><tr><td>Non-controlling interests</td><td>15,033</td><td>12,632</td><td>14,705</td><td>8,134</td><td>7,916</td></tr><tr><td></td><td>278,436</td><td>293,376</td><td>513,193</td><td>196,026</td><td>206,683</td></tr><tr><td>Profit and total comprehensive income (excluding fair value gains
and the relevant deferred taxes) attributable to:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Owners of the Company</td><td>83,274</td><td>58,894</td><td>103,446</td><td>22,554</td><td>145,443</td></tr><tr><td>Non-controlling interests</td><td>7,525</td><td>4,307</td><td>4,808</td><td>1,288</td><td>4,990</td></tr><tr><td></td><td>90,799</td><td>63,201</td><td>108,254</td><td>23,842</td><td>150,433</td></tr></table>
<table><tr><td rowspan="3"></td><td colspan="3">As of 31 December</td><td> As of 30 June</td></tr><tr><td>2009</td><td>2010</td><td>2011</td><td>2012</td></tr><tr><td>RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td></tr><tr><td>Current assets</td><td>1,058,443</td><td>1,421,378</td><td>1,175,695</td><td>1,125,256</td></tr><tr><td>Current liabilities</td><td>975,153</td><td>1,249,910</td><td>1,178,662</td><td>756,582</td></tr><tr><td>Net current assets (liabilities)</td><td>83,290</td><td>171,468</td><td>(2,967)</td><td>368,674</td></tr><tr><td>Net assets</td><td>1,354,631</td><td>1,635,894</td><td>2,077,334</td><td>2,640,968</td></tr><tr><td>Total assets</td><td>3,039,726</td><td>3,800,116</td><td>4,254,543</td><td>4,477,322</td></tr></table>
# Selected Consolidated Statements of Cash Flows Line Items
<table><tr><td rowspan="4"></td><td colspan="3">Year ended 31 December</td><td colspan="2"> Six months ended 30 June</td></tr><tr><td>2009</td><td>2010</td><td>2011</td><td>2011</td><td>2012</td></tr><tr><td>RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td></tr><tr><td></td><td></td><td></td><td>(unaudited)</td><td></td></tr><tr><td>Net cash from (used in) operating activities</td><td>26,684</td><td>261,480</td><td>134,012</td><td>118,520</td><td>(75,434)</td></tr><tr><td>Net cash (used in) from investing activities</td><td>(10,793)</td><td>(158,269)</td><td>(99,997)</td><td>(94,034)</td><td>16,586</td></tr><tr><td>Net cash from (used in) financing activities</td><td>158,503</td><td>75,693</td><td>(225,540)</td><td>(108,518)</td><td>(45,404)</td></tr><tr><td>Net increase (decrease) in cash and cash equivalents</td><td>174,394</td><td>178,904</td><td>(191,525)</td><td>(84,032)</td><td>(104,252)</td></tr><tr><td>Cash and cash equivalents at beginning of year/period</td><td>34,868</td><td>209,262</td><td>388,166</td><td>388,166</td><td>196,641</td></tr><tr><td>Cash and cash equivalents at end of year/period</td><td>209,262</td><td>388,166</td><td>196,641</td><td>304,134</td><td>92,389</td></tr></table> |
11782697_14.pdf | en | # I. DISCUSSION AND ANALYSIS ON THE OPERATIONS
In 2018, the macro economy basically maintained a stable and positive development trend, while the coal production and economy were in a good state of operation, industry concentration was further improved. The supply and demand in the domestic coal market were booming and balanced as well in general. The supply-side reform drove a continual rise of coal price and better profitability of the industry. Based on its existing strategic development goals, the Company was effectively responsive to market changes for the purpose of advancing its continuous high-quality development.
As of the end of the reporting period, the Company recorded a total asset of RMB94.551 billion, a revenue of RMB38.017 billion in 2018 and a net profit attributable to owners of the parent company of RMB4.194 billion.
# (I) Coal sector
During the reporting period, the Company has realized production of commodity coal of 47.69 million tonnes and sales of coal of 85.99 million tonnes.
# 1. Coal production
During the reporting period, the Company completed the optimization and promotion of new processes and new technologies, improved the recovery rate and maximized economic benefits. Meanwhile, the Company focused on deliberating on the coal refining plans for all coal mines and coal washing plants, assisted the reform of production system, diversified the type of commodity coal, and increased lump coal rate, thereby achieving coal refining, cost reduction and efficiency enhancement.
# 2. Coal transportation and sales
In 2018, the Company strengthened marketing for coal. On the basis of enhancing the key contracted users, the Company brought its sale pace under control through sub-division of coal type, combination of futures and spot, direct supply of orders, container distribution and other new trade modes, optimizing its client structure and gradually releasing new driving forces.
# (II) Railway sector
In 2018, as driven by the strategy of transportation-sale integration, the Company seized the new opportunities brought by the reform of railway cargo settlement, strengthened the coordination of transportation with sales and storage & shipment management to improve the turnover rate; and established the Gonggou Shipment Station and increased supply. During the reporting period, Zhundong Railway Company and Huzhun Railway Company dispatched 74.20 million tonnes and 32.15 million tonnes of coal, respectively. The traffic volume through the Company’s self-operated railways first exceeded 100 million tonnes with a profit of RMB667 million achieved. |
11782697_15.pdf | en | # I. DISCUSSION AND ANALYSIS ON THE OPERATIONS (Continued)
# (III)Coal-to-chemicals sector
The layout of coal-to-chemicals industry is an important strategic move for the Company to extend its industrial chain, achieve transformation and upgrading and enhance its core competitiveness. The “13th Five-Year Plan for Energy Development” clearly states that the pace of development should be rationally controlled, technological innovation and market risk assessment should be strengthened, the conditions for environmental protection accession should be strictly implemented, the deep processing of coal should be developed in order, the upgrading of coal-to-fuel, coal-to-olefin production and other demonstrations should be steadily promoted and the competitiveness and risk-resistance of the project should be enhanced according to the orientation of the National Energy Technology Reserve and Capacity Reserve Demonstration Project. A total of three projects of “Xinjiang Yili”, “Xinjiang Ganquanpu” and “Inner Mongolia Yitai” were selected as key coal liquefaction projects in the “13th Five-Year Plan” for deep processing of coal. The Company has been unswervingly speeding up the approval and construction of coal chemical projects.
# 1. Demonstration project of coal-to-oil production of 0.16 Mtpa
During the reporting period, on ensuring the safe and stable production, Coal-to-oil Company optimized its processes and procedures, and enhanced technical innovation so that a total of 0.1943 million tonnes of various types of oil and chemicals were produced during the year. In the meantime, the Company realized the target of inventory-cutting and cost reduction and efficiency improvement via reasonable allocation of inventory materials and enhancement of cost control, and recorded a revenue of RMB894 million and a net profit of RMB31.84 million.
The 0.05 Mtpa stable light hydrocarbons deep processing project of Coal-to-oil Company achieved a successful trial run, further extending the industry chain and increasing the added value of the products for the Company.
# 2. Project construction
The 1.2 Mtpa of fine chemicals project of Yitai Chemical completed the transfer from CIP to PPE at the end of September 2018. The Company is actively advancing the engineering settlement and budgeting of the project. During the year, Yitai Chemical recorded a production volume of 0.26 million tonnes of chemicals, and a revenue of RMB1.292 billion and net profit of RMB57.78 million.
In 2018, as to the second phase of the 2 Mtpa indirect coal-to-liquids conversion pilot project of Coal-to-oil Company, the Company adjusted the product scheme and some process plan for the second phase of the project by focusing on the design optimization and taking into account of the implementation of the project, upper-stream facilities cooperation and construction, investment and financing, product scheme adjustment and other factors.
During the reporting period, Yili Energy actively carried out project site management, supporting resource integration and product scheme optimization, continued to promote the financing works and introduction of strategic partners.
During the reporting period, Yitai Xinjiang continued to enhance project site management for its energy project, and advanced the approval work for the project in a planned and orderly manner. |
20794136_93.pdf | en | # Other Net Realized Investment Gains
Other net realized investment gains in 2017 included \$236 million of net realized investment gains related to equity securities, \$10 million of net realized investment gains from real estate sales,\$4 million of net realized gains related to fixed maturity investments and \$20 million of net realized investment losses related to other investments.
Other net realized investment gains in 2016 included \$59 million of net realized gains related to fixed maturity investments, \$14 million of net realized investment gains related to equity securities,\$7 million of net realized investment gains from real estate sales and \$17 million of net realized investment gains related to other investments.
Other net realized investment gains in 2015 included \$81 million of net realized gains related to fixed maturity investments, \$6 million of net realized investment gains related to equity securities,\$2 million of net realized investment gains from real estate sales and \$34 million of net realized investment losses related to other investments. The net realized investment losses related to other investments included \$26 million of realized foreign exchange translation losses incurred in connection with the Company’s increased ownership of Travelers Participac¸o˜es em Seguros Brasil S.A.
# Other Revenues
Other revenues in all years presented included installment premium charges. Other revenues in 2017 also included revenues from Simply Business, which was acquired in August 2017. Other revenues in 2017 and 2016 also included gains related to the settlement of reinsurance disputes (discussed in more detail in note 16 of notes to the consolidated financial statements). Other revenues in 2016 also included proceeds from the favorable settlement of a claims-related legal matter.
# Claims and Expenses
# Claims and Claim Adjustment Expenses
Claims and claim adjustment expenses in 2017 were \$17.47 billion, \$2.40 billion or 16% higher than in 2016, primarily reflecting the impacts of (i) significantly higher catastrophe losses, (ii) higher volumes of insured exposures, (iii) loss cost trends, (iv) lower net favorable prior year reserve development, (v) higher non-catastrophe fire-related losses in Business Insurance and (vi) higher non-catastrophe weather-related losses in Personal Insurance. Catastrophe losses in 2017 primarily resulted from wildfires in California, Hurricanes Harvey, Irma and Maria, and several winter, wind and hail storms throughout the United States.
Claims and claim adjustment expenses in 2016 were \$15.07 billion, \$1.35 billion or 10% higher than in 2015, primarily reflecting the impacts of (i) higher volumes of insured exposures, (ii) loss cost trends, (iii) higher catastrophe losses, (iv) lower net favorable prior year reserve development and (v) higher loss estimates in the personal automobile product line for bodily injury liability coverages, partially offset by (vi) lower non-catastrophe fire-related losses and other loss activity in Business Insurance. Catastrophe losses in 2016 primarily resulted from Hurricane Matthew, wind and hail storms in several regions of the United States, flooding in the Southeast region of the United States, wildfires in Canada and Tennessee, and winter storms in the eastern United States. Catastrophe losses in 2015 primarily resulted from wildfires in California, and several winter, wind and hail storms throughout the United States.
Factors contributing to net favorable prior year reserve development during the years ended December 31, 2017, 2016 and 2015 are discussed in more detail in note 7 of notes to the consolidated financial statements. |
20794136_94.pdf | en | # Significant Catastrophe Losses
The Company defines a ‘‘catastrophe’’ as an event that:
• is designated a catastrophe by internationally recognized organizations that track and report on insured losses resulting from catastrophic events, such as Property Claim Services (PCS) for events in the United States and Canada; and
• the Company’s estimates of its ultimate losses before reinsurance and taxes exceed a pre-established dollar threshold.
The Company’s threshold for disclosing catastrophes is primarily determined at the reportable segment level. If a threshold for one segment or a combination thereof is exceeded and the other segments have losses from the same event, losses from the event are identified as catastrophe losses in the segment results and for the consolidated results of the Company. Additionally, an aggregate threshold is applied for International business across all reportable segments. The threshold for 2017 ranged from approximately \$17 million to \$30 million of losses before reinsurance and taxes.
The following table presents the amount of losses recorded by the Company for significant catastrophes that occurred in 2017, 2016 and 2015, the amount of net unfavorable (favorable) prior year reserve development recognized in 2017 and 2016 for catastrophes that occurred in 2016 and 2015, and the estimate of ultimate losses for those catastrophes at December 31, 2017, 2016 and 2015. For purposes of the table, a significant catastrophe is an event for which the Company estimates its ultimate losses will be \$100 million or more after reinsurance and before taxes.
<table><tr><td rowspan="2">(in millions, pre-tax and net of reinsurance)</td><td colspan="3">Losses Incurred /
Unfavorable (Favorable)
Prior Year Reserve
Development for the Year
Ended December 31,</td><td colspan="3"> Estimated Ultimate
Losses at December 31,</td></tr><tr><td>2017</td><td>2016</td><td>2015</td><td>2017</td><td>2016</td><td>2015</td></tr><tr><td>2015</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>PCS Serial Number:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>68—Winter storm . . . . . . . . . . . . . . . . . . . . . . . . . .</td><td> $ 3</td><td> $(11)</td><td>$140</td><td> $132</td><td> $129</td><td> $140</td></tr><tr><td>2016</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>PCS Serial Number:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>21—Severe wind and hail storms . . . . . . . . . . . . . . .</td><td>(2)</td><td>150</td><td> n/a</td><td>148</td><td>150</td><td> n/a</td></tr><tr><td>25—Severe wind and hail storms . . . . . . . . . . . . . . .</td><td>10</td><td>168</td><td> n/a</td><td>178</td><td>168</td><td> n/a</td></tr><tr><td>2017</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>PCS Serial Number:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>22—Severe wind and hail storms . . . . . . . . . . . . . . .</td><td>111</td><td> n/a</td><td> n/a</td><td>111</td><td> n/a</td><td> n/a</td></tr><tr><td>32—Severe wind and hail storms . . . . . . . . . . . . . . .</td><td>210</td><td> n/a</td><td> n/a</td><td>210</td><td> n/a</td><td> n/a</td></tr><tr><td>43—Hurricane Harvey . . . . . . . . . . . . . . . . . . . . . . .</td><td>254</td><td> n/a</td><td> n/a</td><td>254</td><td> n/a</td><td> n/a</td></tr><tr><td>44—Hurricane Irma . . . . . . . . . . . . . . . . . . . . . . . .</td><td>187</td><td> n/a</td><td> n/a</td><td>187</td><td> n/a</td><td> n/a</td></tr><tr><td>48—California wildfire—Tubbs fire . . . . . . . . . . . . . .</td><td>507</td><td> n/a</td><td> n/a</td><td>507</td><td> n/a</td><td> n/a</td></tr></table>
n/a: not applicable.
# Amortization of Deferred Acquisition Costs
Amortization of deferred acquisition costs in 2017 was \$4.17 billion, \$181 million or 5% higher than in 2016. Amortization of deferred acquisition costs in 2016 was \$3.99 billion, \$100 million or 3% higher than in 2015. Amortization of deferred acquisition costs is discussed in more detail in the segment discussions that follow. |
9252114_278.pdf | en | (3) Times International is wholly-owned by Honour Family. Honour Family is wholly-owned by UBS Trustees as trustee of the Honour Family Trust. Mr. Huang is the settlor of Honour Family Trust. Times Properties is wholly-owned by Mr. Huang. Mr. Wong is the brother of Mr. Huang and both Mr. Wong and Mr. Huang have agreed to act in concert with each other. Each of Times International, Honour Family, UBS Trustees, Times Properties and Mr. Huang is deemed to be interested in the Shares in which TGI is interested.
(4) Sze Kai Fei is the spouse of Mr. Wong. By virtue of the SFO, Sze Kai Fei is deemed to be interested in the Shares in which Mr. Wong is interested.
(5) Fan Huili is the spouse of Mr. Huang. By virtue of the SFO, Fan Huili is deemed to be interested in the Shares held by Mr. Huang.
If the Over-allotment Option is fully exercised, the beneficial interest of each of TGI, Redco Holdings, Redco Properties, Global Universe, Global Investment, Mr. Wong, Times International, Honour Family, UBS Trustees, Times Properties, Mr. Huang and Ms. Sze Kai Fei will be approximately 72.29%.
Save as disclosed above and in “Appendix IV — Statutory and General Information — C. Further Information about our Directors and Substantial Shareholders”, our Directors are not aware of any person who will, immediately following the completion of the Capitalization Issue and the Global Offering (without taking into account any Shares which may be issued pursuant to the exercise of the Over-allotment Option), have beneficial interests or short positions in any Shares or underlying Shares, which would be required to be disclosed to us under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who is, directly or indirectly interested in 10% or more of the issued voting shares of any member of our Group. Our Directors are not aware of any arrangement which may at a subsequent date result in a change of control of our Company. |
9252114_279.pdf | en | The following is a description of the authorized and issued share capital of our Company in issue and to be issued as fully paid or credited as fully paid immediately before and following the completion of the Global Offering and the Capitalization Issue (without taking into account any Shares which may be issued pursuant to the exercise of the Over-allotment Option):
<table><tr><td rowspan="2" colspan="2"></td><td>Nominal value</td></tr><tr><td>(HK$)</td></tr><tr><td colspan="3">Authorized share cailpta:</td></tr><tr><td>1,000,000,000</td><td> Shares of HK$0.1 each</td><td>100,000,000</td></tr><tr><td colspan="3">Issued and to be issued, fully paid or credited as fully paid:</td></tr><tr><td>4</td><td> Shares in issue as of the date of this document</td><td>0.4</td></tr><tr><td>149,999,996</td><td> Shares to be issued lipursuant to the Caiiptazaton Issue</td><td>14,999,999.6</td></tr><tr><td>50,000,000</td><td> Shares to be issued under the Global Offering</td><td>5,000,000</td></tr><tr><td>200,000,000</td><td> Total</td><td>20,000,000</td></tr></table>
# ASSUMPTIONS
The above table assumes that the Global Offering becomes unconditional and the Shares are issued pursuant to the Global Offering and Capitalization Issue are made. It takes no account of any Shares which may be allotted and issued pursuant to the exercise of the Over-allotment Option or any Shares which may be issued or repurchased by us pursuant to the general mandates granted to our Directors to issue or repurchase Shares as described below.
# RANKINGS
The Offer Shares will be ordinary shares in the share capital of our Company and will carry the same rights in all respects with all Shares in issue or to be issued as mentioned in this document and, in particular, will rank in full for all dividends or other distributions declared, made or paid on the Shares in respect of a record date which falls after the date of this document save for the entitlement under the Capitalization Issue.
# GENERAL MANDATES TO ALLOT AND ISSUE AND TO REPURCHASE SHARES
Subject to the Global Offering becoming unconditional, general mandates have been granted to our Directors to allot and issue Shares and to repurchase Shares. See “Statutory and General Information — A. Further Information about Our Company — 4. Written Resolutions of Our Shareholder passed on March 14, 2022” in Appendix IV to this document for details of such general mandates. |
2913910_242.pdf | en | # IX. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (Continued)
# 1. Objective and policies of risk management (Continued)
# (1) Market risks (Continued)
# 2) Interest rate risk
The risk that changes in interest rate lead to changes in cash flow of the financial instruments of the Company is mainly associated with floating-rate bank borrowings. The Company currently does not have a foreign currency hedging policy to hedge against its exposures. However, the management will closely monitor foreign currency risk and will consider hedging significant foreign currency risk when the risk arises.
# 3) Price risk
The Company other price risk is mainly concentrated on investments held for trading quoted in the stock exchange of the PRC. The management monitors the price risk exposure and will take appropriate measures should the need arise.
# (2) Credit risk
On 31 December 2018, the most significant credit risk exposure that might incur financial losses on the Company was mainly attributable to a contractual counterparty’s failure to perform its obligations resulting losses on financial assets of the Company and financial guarantee undertaken by the Company, specific details are set out as follows:
The carrying amount of financial assets recognised in the consolidated balance sheet: in respect of financial instruments carried at fair value, the carrying amount reflects the risk exposure; however, such amount does not represent the maximum credit exposure which changes in line with future changes in fair value.
In order to mitigate credit risk, the Company established a committee to be responsible for determining credit limits, approving credit applications and carrying out other monitoring procedures to ensure necessary actions are taken to collect overdue debts. Besides, the Company reassesses the collectability of each amount receivable on an individual basis at each balance sheet date, in order to ensure sufficient bad debt provision is allocated for amounts that are not recoverable. As such, the management of the Company believes the credit risk assumed by the Company has been significantly reduced. |
2913910_243.pdf | en | # IX. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (Continued)
# 1. Objective and policies of risk management (Continued)
# (2) Credit risk (Continued)
The Company places its liquid funds at banks with relatively higher credit ratings; therefore, the credit risk with respect to liquid funds is low.
Since the Company’s risk exposures are distributed among various contractual parties and various customers, the Group has no significant concentration risk. Top five account receivables in total: RMB341,388,578.27.
# (3) Liquidity risk
The liquidity risk is the Company’s impossibility to perform its financial obligations after the maturity date. In the management of the liquidity risk, the Company monitors and maintains a level of working capital deemed adequate by the management to perform the Company’s obligations, thus will not cause loss or damage to the reputation of the Company. Moreover, the Company analyses its debt structure and deadline regularly and maintain sufficient fund. The management monitors the utilization of bank borrowings and ensures compliance with loan covenants. In the meanwhile, the management conducts negotiation on financing issues with financial institutions to maintain enough credit limits and mitigate liquidity risk.
The Company’s main capital source is from bank borrowing. As at 31 December 2018, the unused credit facilities of bank borrowing of the Company was RMB3.270 billion (31 December 2017: RMB3.689 billion), including unused short-term bank borrowings facilities of the Company of RMB3.100 billion (31 December 2017: RMB3.257 billion), representing a significant change as compared to last year, mainly due to the issuance of bonds for financing in this period which results in more remaining credit of bank borrowings. |
11713891_19.pdf | en | guidance at its 2Q21 results to not less than 25% yoy, from not less than 42.3% yoy (Fig 12).
OneConnect maintained its FY21F net margin guidance at a double-digit percentage point improvement yoy. 2Q21 net margin improved 6.7%-pts yoy, with 1H21 net margin improving 18.5%-pts yoy
Revenue growth has been slowing, from FY18’s 143% yoy to FY20’s 42% yoy and 1Q21’s 41% yoy. While OneConnect’s revenue relies heavily on Ping An Group and its associate, Lufax, with both of these comprising 65% of total revenues in 1H21, it had been making an effort to expand revenues from other parties.
Unfortunately, the Covid-19 outbreak has made it more difficult to source new customers.
Consequently, OneConnect announced at its 2Q21 results that it has decided to shift its strategy to focus more on existing premium customers, including the ‘premium plus’ segment. OneConnect defines the ‘premium plus’ segment as customers (excluding Ping An Group and its subsidiaries) with annual revenue contribution of at least Rmb1m, which is in contrast with the ‘premium’ segment, which is defined as customers (excluding Ping An Group and its subsidiaries) with annual revenue contribution of at least Rmb100,000.
Figure 22: Revenue by source
<table><tr><td></td><td>FY17</td><td>FY18</td><td> FY19</td><td> FY20</td><td> 1H20</td><td>4Q19</td><td>1Q20</td><td> 2Q20</td><td> 3Q20</td><td> 4Q20</td><td>1Q21</td><td>2Q21</td></tr><tr><td colspan="13">Revenue by customer (Rmb m)</td></tr><tr><td>Ping An Group</td><td>236</td><td>528</td><td>995</td><td>1,727</td><td>1,000</td><td>317</td><td>228</td><td>392</td><td>491</td><td>616</td><td>436</td><td>564</td></tr><tr><td>Lufax</td><td>175</td><td>387</td><td>299</td><td>343</td><td>165</td><td>114</td><td>83</td><td>95</td><td>88</td><td>77</td><td>75</td><td>90</td></tr><tr><td>3rd-party customers</td><td>171</td><td>499</td><td>1,034</td><td>1,242</td><td>623</td><td>341</td><td>270</td><td>287</td><td>302</td><td>383</td><td>309</td><td>314</td></tr><tr><td>Total</td><td>582</td><td>1,413</td><td>2,328</td><td>3,312</td><td>1,788</td><td>773</td><td>581</td><td>774</td><td>881</td><td>1,076</td><td>820</td><td>968</td></tr><tr><td colspan="13">Mix of revenue by customer</td></tr><tr><td>Ping An Group</td><td>41%</td><td>37%</td><td>43%</td><td>52%</td><td>56%</td><td>41%</td><td>39%</td><td>51%</td><td>56%</td><td>57%</td><td>53%</td><td>58%</td></tr><tr><td>Lufax</td><td>30%</td><td>27%</td><td>13%</td><td>10%</td><td>9%</td><td>15%</td><td>14%</td><td>12%</td><td>10%</td><td>7%</td><td>9%</td><td>9%</td></tr><tr><td>3rd-party customers</td><td>29%</td><td>35%</td><td>44%</td><td>38%</td><td>35%</td><td>44%</td><td>46%</td><td>37%</td><td>34%</td><td>36%</td><td>38%</td><td>32%</td></tr><tr><td>Total</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td></tr><tr><td colspan="13">Growth yoy</td></tr><tr><td>Ping An Group</td><td></td><td>124%</td><td>89%</td><td>74%</td><td>61%</td><td>40%</td><td>11%</td><td>68%</td><td>105%</td><td>94%</td><td>92%</td><td>44%</td></tr><tr><td>Lufax</td><td></td><td>121%</td><td>-23%</td><td>15%</td><td>-8%</td><td>3%</td><td>30%</td><td>44%</td><td>61%</td><td>-33%</td><td>-10%</td><td>-6%</td></tr><tr><td>3rd-party customers</td><td></td><td>192%</td><td>107%</td><td>20%</td><td>12%</td><td>98%</td><td>50%</td><td>29%</td><td>4%</td><td>12%</td><td>14%</td><td>9%</td></tr><tr><td>Total</td><td></td><td>143%</td><td>65%</td><td>42%</td><td>32%</td><td>51%</td><td>30%</td><td>48%</td><td>51%</td><td>39%</td><td>41%</td><td>25%</td></tr></table>
SOURCES: CGS-CIMB RESEARCH, COMPANY REPORTS
Figure 23: Revenue by customer type
<table><tr><td>(Rmb m)</td><td>FY17</td><td>FY18</td><td>FY19</td><td>FY20</td></tr><tr><td>Ping An Group</td><td>236</td><td>528</td><td>995</td><td>1,727</td></tr><tr><td>Premium Customers</td><td>345</td><td>865</td><td>1,306</td><td>1,517</td></tr><tr><td>Basic Customers</td><td>1</td><td>21</td><td>27</td><td>68</td></tr><tr><td>Total</td><td>582</td><td>1,414</td><td>2,328</td><td>3,312</td></tr><tr><td>Growth yoy</td><td></td><td></td><td></td><td></td></tr><tr><td>Ping An Group</td><td></td><td>124%</td><td>89%</td><td>74%</td></tr><tr><td>Premium Customers</td><td></td><td>151%</td><td>51%</td><td>16%</td></tr><tr><td>Basic Customers</td><td></td><td>1960%</td><td>33%</td><td>150%</td></tr><tr><td>Total</td><td></td><td>143%</td><td>65%</td><td>42%</td></tr><tr><td>Mix</td><td></td><td></td><td></td><td></td></tr><tr><td>Ping An Group</td><td>41%</td><td>37%</td><td>43%</td><td>52%</td></tr><tr><td>Premium Customers</td><td>59%</td><td>61%</td><td>56%</td><td>46%</td></tr><tr><td>Basic Customers</td><td>0%</td><td>1%</td><td>1%</td><td>2%</td></tr><tr><td>Total</td><td>100%</td><td>100%</td><td>100%</td><td>100%</td></tr></table>
SOURCES: CGS-CIMB RESEARCH, COMPANY REPORTS
OneConnect has two main types of revenue: (i) implementation and (ii) transaction-based and support services.
Implementation revenue primarily consists of revenue from customer-specific software development, or customisation services provided to customers for using OneConnect’s platform either via cloud offerings or on-site.
On the other hand, transaction-based and support services relate to revenue charged to financial institution customers (mainly retail banking) based on the transaction volume generated on OneConnect’s platform. As of FY20, 74% of OneConnect’s revenue was transaction-based, and rose to 79% in 1Q21.
OneConnect has six main sources of transaction-based and support services. Business origination services were previously the most important, comprising 78% of total revenue in FY17. This segment has fallen markedly in importance, contributing only 18% of total revenue in FY20 (and only 12% in 2Q21). Business origination services involved OneConnect assisting financial institutions in acquiring customers for their loans, wealth management products and insurance policies. This is typically via the provision of customer leads, either via their own systems or third-party sources.
The most important revenue segment at the end of FY20 was operation support services, comprising 32% of revenues in FY20. FY20 growth was an impressive 82% yoy. Operation support services primarily include artificial intelligence (AI) customer services and adjuster and roadside assistance management modules. |
11713891_20.pdf | en | COVID-19 has also had a negative impact on project implementation and customer usage of OneConnect’s solutions as it has caused delays in project implementation and client interaction.
# Regulatory risk is hurting revenue growth in the near-term
OneConnect operates in an industry where customers face high regulatory risk, with the regulatory environment still evolving. This is especially the case for revenues relating to co-lending or facilitation of loans, which we think a sizeable number of small banks employ to help boost loan growth.
The revenue segment most at risk from stricter regulations is OneConnect’s business origination segment (13% of revenue in 1H21), in particular those relating to Internet marketing-related services. Some element of operation support (27% of revenues in 1H21), in particular those relating to asset monitoring services, are also impacted. Risk management revenues (11% of revenues in 1H21) are also at risk.
Specifically, OneConnect has flagged four regulations in Fig 25 that impact its business in two main areas - namely the use of personal data and limits to the geographical expansion of regional banks (namely city commercial banks and rural commercial banks).
For the use of personal data, the key regulations are Measures for the Administration of Credit Investigation Services (Draft for Comments)（征信业务管理办法 (征求意见稿)）and Measures for Cybersecurity Review (Revision Draft for Comments)（国家互联网信息办公室关于《网络安全审查办法(修订草案征求意见稿)》.
These state that Internet platforms need authorisation from individuals to collect personal data. This means that Internet platforms collecting personal data are now required to obtain explicit approval from users. As a result, banks have to adjust their way of approaching risk management to ensure compliance with the new regulations.
For geographical limitations on regional banks, the regulations are Notice on Regulating Personal Deposit Business by Commercial Banks through the Internet (关于规范商业银行通过互联网开展个人存款业务有关事项的通知) and Interim Measures for the Administration of Internet Loans of Commercial Banks(商业银行互联网贷款管理暂行办法).
Under these two regulations, regional banks are not allowed to carry out any activities beyond branch presence. Also, commercial banks cannot offer deposit products through third-party Internet platforms. This new rule affects new business development through online channels for these regional banks. OneConnect has stopped offering products that are not compliant with the new rules on its platform.
OneConnect quantified the revenue impact of these four regulations, stating at its 2Q21 results that revenue exposure to these regulations was more than Rmb500m in FY20. In 1H21, the actual negative impact to revenues from these regulations was Rmb170m, and stemmed from hits to Internet marketing-related services and asset monitoring services, in particular in 2Q21. OneConnect stated at its 2Q21 analyst briefing that risk management revenues would also be impacted in 2H21F. |
20749936_312.pdf | en | its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
# 2.9 Financial assets
# (i) Classification
The Group classifies its financial assets in the following measurement categories:
• those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and
• those to be measured at amortized cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in debt instruments, this will depend on the business model in which the investment is held. For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income.
See Note 16 for details about each type of financial asset.
The Group reclassifies debt investments when and only when its business model for managing those assets changes.
# (ii) Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
# Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its debt instruments:
• Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. A gain or loss on a debt investment that is subsequently measured at amortized cost and is not part of a hedging relationship is recognized in profit or loss when the asset is derecognized or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.
• Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit or loss and recognized in other gains/(losses). Interest income from these financial assets is included in finance income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains and losses and impairment expenses in other expenses. |
20749936_313.pdf | en | • Fair value through profit or loss: Assets that do not meet the criteria for amortized cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognized in profit or loss and presented net in profit or loss within other gains/(losses) in the period in which it arises.
# Equity instruments
The Group subsequently measures all equity investments at fair value. Where the Group’s management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be recognized in profit or loss as other income when the Group’s right to receive payments is established.
Changes in the fair value of financial assets at fair value through profit or loss are recognized in other gain/(losses) in profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.
# (iii) Impairment
The Group assesses on a forward looking basis the expected credit losses associated with its debt instruments carried at amortized cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 3.1(b) details how the Group determines whether there has been a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by IFRS 9, that is to measure the loss allowance at the amount equal to lifetime expected credit loss at initial recognition and through its life of the asset. The Group uses practical expedients when estimating life time expected credit losses on trade receivables, which is calculated using a provision matrix where a fixed provision rate applies depending on the number of days that a trade receivable is outstanding.
# 2.10 Trade receivables
Trade receivables are amounts due from third party distribution platforms (“Platforms”) or payment channels for proceeds earned from selling game tokens and other virtual items (Note 21). If collection of trade receivables is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.
Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method, less provision for impairment. See Note 21 for further information about the Group’s accounting for trade receivables and Note 2.9 for a description of the Group’s impairment policies.
# 2.11 Cash and cash equivalents
In the combined statements of cash flows, cash and cash equivalents include cash in hand and deposits at call with banks and other short-term liquid investments with original maturities of three months or less.
# 2.12 Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
# 2.13 Trade payables
Trade payables represent payment received from game players and to be reimbursed to the game developers. The amounts are unsecured and are usually paid within 30 to 90 days of recognition. Trade payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognized initially at their fair values and subsequently measured at amortized cost using the effective interest method.
# 2.14 Current and deferred income tax
The income tax expense or credit for the period is the tax payable or recoverable on the current period’s taxable income based on the applicable income tax rate for eachj urisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. |
8405636_512.pdf | en | # 21 TRADE RECEIVABLES
<table><tr><td rowspan="3"></td><td colspan="3">As at 31 December</td><td>As at
30 June</td></tr><tr><td>2017</td><td>2018</td><td>2019</td><td>2020</td></tr><tr><td>RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td></tr><tr><td>Trade receivables (Note (a))</td><td></td><td></td><td></td><td></td></tr><tr><td>– Related parties (Note 34(b)) </td><td>97,848</td><td>254,914</td><td>349,303</td><td>475,419</td></tr><tr><td>– Third parties</td><td>115,474</td><td>143,819</td><td>248,693</td><td>618,158</td></tr><tr><td></td><td>213,322</td><td>398,733</td><td>597,996</td><td>1,093,577</td></tr><tr><td>Less: allowance for impairment of
trade receivables </td><td>(5,220)</td><td>(6,130)</td><td>(11,740)</td><td>(17,440)</td></tr><tr><td></td><td>208,102</td><td>392,603</td><td>586,256</td><td>1,076,137</td></tr></table>
(a) Trade receivables mainly arise from property management services managed under lump sum basis and value-added services.
Property management services income under lump sum basis are received in accordance with the term of the relevant property service agreements. Service income from property management services is due for payment by the property owners upon rendering of services.
As at 31 December 2017, 2018 and 2019 and 30 June 2020, the ageing analysis of the trade receivables based on date of revenue recognition were as follows:
<table><tr><td rowspan="3"></td><td colspan="3">As at 31 December</td><td>As at
30 June</td></tr><tr><td>2017</td><td>2018</td><td>2019</td><td>2020</td></tr><tr><td>RMB’000</td><td> RMB’000</td><td> RMB’000</td><td> RMB’000</td></tr><tr><td>Within 1 year </td><td>178,549</td><td>352,931</td><td>502,635</td><td>958,654</td></tr><tr><td>1 to 2 years </td><td>22,646</td><td>27,823</td><td>43,024</td><td>91,581</td></tr><tr><td>2 to 3 years </td><td>6,763</td><td>13,079</td><td>31,418</td><td>25,738</td></tr><tr><td>3 to 4 years </td><td>2,970</td><td>2,409</td><td>16,841</td><td>12,506</td></tr><tr><td>4 to 5 years </td><td>1,051</td><td>1,379</td><td>3,040</td><td>3,863</td></tr><tr><td>Over 5 years </td><td>1,343</td><td>1,112</td><td>1,038</td><td>1,235</td></tr><tr><td></td><td>213,322</td><td>398,733</td><td>597,996</td><td>1,093,577</td></tr></table>
As at 31 December 2017, 2018 and 2019 and 30 June 2020, trade receivables were denominated in RMB, and the fair value of trade receivables approximated their carrying amounts due to short credit term. |
8405636_513.pdf | en | The Group applies the simplified approach to provide for expected credit losses prescribed by HKFRS 9, which permits the use of the lifetime expected loss provision for all trade receivables. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due. Movements on the provision for impairment of trade receivables are shown in Note 3.1(b). For the years ended 31 December 2017, 2018 and 2019 and the six months ended 30 June 2020, a provision of RMB1,080,000, RMB910,000 and RMB2,199,000 and RMB5,248,000 was made against the gross amounts of trade receivables. For the year ended 31 December 2019, a provision of RMB3,411,000 was derived from the effect of combination of Chengdu Global Century. For the six months ended 30 June 2020, a provision of RMB452,000 was made against the originally impaired trade receivables from NCPM since the date of acquisition. The provision for impairment increased during the Track Record Period due to the increase of trade receivables.
# 22 PREPAYMENTS AND OTHER RECEIVABLES
<table><tr><td rowspan="4"></td><td colspan="6">As at 31 December</td><td colspan="2">As at 30 June</td></tr><tr><td colspan="2">2017</td><td colspan="2">2018</td><td colspan="2">2019</td><td colspan="2">2020</td></tr><tr><td colspan="2">RMB’000</td><td colspan="2">RMB’000</td><td colspan="2">RMB’000</td><td colspan="2">RMB’000</td></tr><tr><td>Current</td><td>Non-
current</td><td> Current</td><td>Non-
current</td><td> Current</td><td>Non-
current</td><td> Current</td><td>Non-
current</td></tr><tr><td>Prepayments</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– Utilities </td><td>4,573</td><td> –</td><td>7,637</td><td> –</td><td>5,711</td><td> –</td><td>9,300</td><td> –</td></tr><tr><td>– Short-term rental
fees </td><td>758</td><td> –</td><td>2,692</td><td> –</td><td>5,323</td><td> –</td><td>11,466</td><td> –</td></tr><tr><td>– Raw materials for
enigneering and
maintenance
services</td><td>–</td><td> –</td><td>817</td><td> –</td><td>1,992</td><td> –</td><td>5,451</td><td> –</td></tr><tr><td>– Deferred listing
expenses </td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>2,486</td><td> –</td></tr><tr><td>– Others</td><td>1,365</td><td> –</td><td>1,120</td><td>1,082</td><td>5,430</td><td>570</td><td>13,958</td><td>2,380</td></tr><tr><td></td><td>6,696</td><td> –</td><td>12,266</td><td>1,082</td><td>18,456</td><td>570</td><td>42,661</td><td>2,380</td></tr><tr><td>Other receivables</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>– Related parties
(Note 34 (b)) (c) </td><td>3,222</td><td> –</td><td>69,612</td><td> –</td><td>282,262</td><td> –</td><td>81,188</td><td>56,667</td></tr><tr><td>– Loan to a related
party (b)
(Note 34 (b)) </td><td>713,200</td><td>614,600</td><td>614,600</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td></tr><tr><td>– Payments on
behalf of property
owners (a) </td><td>12,547</td><td> –</td><td>18,113</td><td> –</td><td>36,995</td><td> –</td><td>49,606</td><td> –</td></tr><tr><td>– Emlpoyees in
advance</td><td>7,311</td><td> –</td><td>8,982</td><td> –</td><td>11,492</td><td> –</td><td>11,037</td><td> –</td></tr><tr><td>– Deposits </td><td>5,488</td><td> –</td><td>6,781</td><td> –</td><td>10,148</td><td> –</td><td>35,069</td><td>5,863</td></tr><tr><td>– Others</td><td>5,263</td><td> –</td><td>3,766</td><td> –</td><td>2,185</td><td> –</td><td>2,935</td><td> –</td></tr><tr><td></td><td>747,031</td><td>614,600</td><td>721,854</td><td> –</td><td>343,082</td><td> –</td><td>179,835</td><td>62,530</td></tr><tr><td>Less: allowance for
impairment of other
receivables </td><td>(803)</td><td> –</td><td>(1,428)</td><td> –</td><td>(2,095)</td><td> –</td><td>(5,756)</td><td> –</td></tr><tr><td></td><td>746,228</td><td>614,600</td><td>720,426</td><td> –</td><td>340,987</td><td> –</td><td>174,079</td><td>62,530</td></tr><tr><td>Total prepayments and
other receivables </td><td>752,924</td><td>614,600</td><td>732,692</td><td>1,082</td><td>359,443</td><td>570</td><td>216,740</td><td>64,910</td></tr></table> |
2554092_88.pdf | en | The Vascular Solutions acquisition was financed utilizing borrowings under the amended and restated credit agreement, dated January 20, 2017 (the "Credit Agreement"), which is described in Note 8.
The following table presents the purchase price allocation among the assets acquired and liabilities assumed with respect to the Vascular Solutions acquisition:
<table><tr><td></td><td>(Dollars in thousands)</td></tr><tr><td>Assets</td><td></td></tr><tr><td>Current assets</td><td>$ 61,592</td></tr><tr><td>Property, plant and equipment</td><td>45,533</td></tr><tr><td>Intangible assets</td><td>539,250</td></tr><tr><td>Goodwill</td><td>524,872</td></tr><tr><td>Other assets</td><td>728</td></tr><tr><td>Total assets acquired</td><td>1,171,975</td></tr><tr><td>Less:</td><td></td></tr><tr><td>Current liabilities</td><td>15,079</td></tr><tr><td>Deferred tax liabilities</td><td>181,372</td></tr><tr><td>Liabilities assumed</td><td>196,451</td></tr><tr><td>Net assets acquired</td><td>$ 975,524</td></tr></table>
The goodwill resulting from the Vascular Solutions acquisition primarily reflects synergies currently expected to be realized from the integration of the acquired business and is not fully tax deductible.
The following table sets forth the components of identifiable intangible assets acquired and the ranges of the useful lives as of the date of the Vascular Solutions acquisition:
<table><tr><td></td><td>Fair value</td><td>Useful life range</td></tr><tr><td></td><td>(Dollars in thousands)</td><td>(Years)</td></tr><tr><td>Intellectual property</td><td>$ 248,200</td><td>10 20</td></tr><tr><td>Inprocess research and development ("IPR&D")</td><td>15,600</td><td>Indefinite</td></tr><tr><td>Trade names</td><td>16,650</td><td>20</td></tr><tr><td>Customer relationships</td><td>258,800</td><td>25</td></tr></table>
# NeoTract, Inc.
On October 2, 2017, the Company acquired NeoTract, Inc. ("NeoTract"), a medical device company that developed and commercialized the UroLift System, a minimally invasive medical device for treating lower urinary tract symptoms due to benign prostatic hyperplasia, or BPH. The fair value of consideration transferred by the Company was \$975.2 million, which included initial payments of \$725.6 million in cash less a favorable working capital adjustment of \$1.4 million (for which the Company had not yet received payment as of December 31, 2017) and \$251.0 million in estimated fair value of contingent consideration. The contingent consideration liability represents the estimated fair value of the Company's obligations, under the acquisition agreement, to make four milestone payments of up to \$375 million in the aggregate if certain sales goals are met. The milestone payments are based on net sales (as defined in the acquisition agreement) for the periods from January 1, 2018 through April 30, 2018 and the years ended December 31, 2018, 2019 and 2020. The fair value of the contingent consideration was estimated using a Monte Carlo valuation approach. See Note 10 for additional information on the fair value measurement of the contingent consideration. The acquisition was financed using borrowings under the Company's revolving credit facility.
For the year ended December 31, 2017, the Company incurred \$10.1 million in transaction expenses associated with the NeoTract acquisition, which are included in selling, general and administrative expenses in the consolidated statement of income. For the year ended December 31, 2017, the Company recorded post acquisition revenue and operating loss of\$39.0 million and \$13.3 million, respectively, related to NeoTract. Financial information of NeoTract is primarily presented within the newly established Interventional Urology North America operating segment, which is included in the "all other" category in the Company's presentation of segment information. |
2554092_89.pdf | en | The following table presents the purchase price allocation among the assets acquired and liabilities assumed with respect to the NeoTract acquisition:
<table><tr><td></td><td>(Dollars in thousands)</td></tr><tr><td>Assets</td><td></td></tr><tr><td>Current assets</td><td>$ 32,887</td></tr><tr><td>Property, plant and equipment</td><td>6,980</td></tr><tr><td>Intangible assets</td><td>763,314</td></tr><tr><td>Goodwill</td><td>341,171</td></tr><tr><td>Other assets</td><td>184</td></tr><tr><td>Total assets acquired</td><td>1,144,536</td></tr><tr><td>Less:</td><td></td></tr><tr><td>Current liabilities</td><td>13,580</td></tr><tr><td>Deferred tax liabilities</td><td>155,806</td></tr><tr><td>Liabilities assumed</td><td>169,386</td></tr><tr><td>Net assets acquired</td><td>$ 975,150</td></tr></table>
The Company is continuing to evaluate the initial purchase price allocations in connection with its acquisition of NeoTract, and further adjustments may be necessary as a result of the Company's assessment of additional information related to the fair values of the assets acquired and liabilities assumed, primarily deferred tax liabilities, certain intangible assets and goodwill. The goodwill resulting from the NeoTract acquisition primarily reflects the benefit the Company expects to realize from the establishment of new customer relationships and the development of technology resulting from the operation of NeoTract's business. Goodwill arising from the NeoTract acquisition is not tax deductible.
The following table sets forth the components of identifiable intangible assets acquired and the ranges of the useful lives as of the date of the NeoTract acquisition:
<table><tr><td rowspan="2"></td><td>Fair value</td><td>Useful life</td></tr><tr><td>(Dollars in thousands)</td><td>(Years)</td></tr><tr><td>Intellectual property</td><td>$ 492,118</td><td>15</td></tr><tr><td>Trade names</td><td>161,637</td><td>25</td></tr><tr><td>Customer relationships</td><td>109,559</td><td>15</td></tr></table>
# Tianjin Medis Medical Device Co. LTD
On September 15, 2017, the Company acquired certain assets from one of its contract manufacturers, Tianjin Medis Medical Co. LTD ("Tianjin Medis"), consisting of substantially all of the assets used by Tianjin Medis to manufacture a line of the Company's laryngeal masks. The aggregate consideration transferred for the assets was \$21.3 million, which included payments of \$16.0 million and \$5.3 million in estimated fair value of contingent consideration. The assets acquired include goodwill and finitelived intangible assets (consisting of intellectual property, customer relationships and a noncompete agreement) of \$14.7 million and \$6.9 million, respectively. The goodwill resulting from the acquisition primarily reflects synergies currently expected to be realized from the integration of the acquired business and is not tax deductible.
# Pyng Medical Corp
On April 3, 2017, the Company completed the acquisition of Pyng Medical Corp ("Pyng"), a medical device company that developed and marketed sternal intraosseous infusion products, which complement the Company's anesthesia product portfolio. The Company acquired all of the issued and outstanding common shares of Pyng utilizing available cash. The aggregate consideration was \$17.9 million, net of cash acquired. The assets acquired include goodwill and finitelived intangible assets (primarily intellectual property and customer relationships) of \$13.0 million and \$5.5 million, respectively. The goodwill resulting from the acquisition primarily reflects synergies currently expected to be realized from the integration of the acquired business and is not tax deductible. |
9234587_16.pdf | en | # Revenue
The Group’s revenue from continuing operations increased by 46.8% quarter-on-quarter from HK\$7,000 million in the first quarter of 2020 to HK\$10,277 million in the second quarter of 2020. The following table illustrates the revenue in the second and first quarter of 2020 based on different business:
<table><tr><td rowspan="3"></td><td colspan="4">Three months ended</td></tr><tr><td colspan="2">30 June 2020
(unaudited)</td><td colspan="2">31 March 2020
(unaudited)</td></tr><tr><td>HK$’000</td><td>Proportion
in the total
revenue</td><td>HK$’000</td><td>Proportion
in the total
revenue</td></tr><tr><td>TCL brand TV business</td><td></td><td></td><td></td><td></td></tr><tr><td>– Overseas</td><td>6,053,196</td><td>58.9%</td><td>4,269,400</td><td>61.0%</td></tr><tr><td>– the PRC</td><td>2,504,517</td><td>24.4%</td><td>1,889,501</td><td>27.0%</td></tr><tr><td>Internet services</td><td></td><td></td><td></td><td></td></tr><tr><td>– the PRC</td><td>249,689</td><td>2.4%</td><td>146,885</td><td>2.1%</td></tr><tr><td>– Overseas</td><td>116,021</td><td>1.1%</td><td>8,463</td><td>0.1%</td></tr><tr><td>O#thers</td><td>1,353,988</td><td>13.2%</td><td>685,419</td><td>9.8%</td></tr><tr><td>Total revenue</td><td>10,277,411</td><td>100.0%</td><td>6,999,668</td><td>100.0%</td></tr></table>
\# Others mainly comprises revenue from smart home, smart commercial display and smart AV businesses
# TV Business
# Overseas
Revenue of TCL brand TV increased by 41.8% from HK\$4,269 million in the first quarter of 2020 to HK\$6,053 million in the second quarter. The sales volume of TCL brand TV grew by 35.1% from 3.11 million sets in the first quarter of 2020 to 4.20 million sets in the second quarter. The turnaround was attributable to the Group’s active response to the pandemic by swiftly adjusting market strategies and supply capacity which drove up the TV sales.
# The PRC
Revenue of TCL brand TV rose by 32.5% from HK\$1,890 million in the first quarter of 2020 to HK\$2,504 million in the second quarter. The sales volume of TCL brand TV increased by 38.2% from 1.16 million sets in the first quarter of 2020 to 1.61 million sets in the second quarter of 2020. The increase was driven by the Group’s active adjustment of distribution sales and introduction of live-streaming sales, offline channel promotion and other types of sales methods, which contributed to impressive online and offline sales performance. |
9234587_17.pdf | en | The sales volume of TCL brand TV through online distribution channels in the PRC market increased by 70.6% from 510,000 sets in the first quarter of 2020 to 870,000 sets in the second quarter. The offline sales volume increased by 13.9% from 650,000 sets in the first quarter of 2020 to 740,000 sets in the second quarter of 2020. The growth was powered by the Group’s increased investment in marketing resources of online sales and maintenance of advantages of offline sales distribution channels.
# Internet Services
# The PRC
Revenue of the Internet business in the PRC (mainly relevant business of Falcon Network Technology) increased by 70.0% from HK\$147 million in the first quarter of 2020 to HK\$250 million in the second quarter. Among which, revenue from membership business, value-added business and advertising business of Falcon Network Technology rose by 12.0%, 363.8% and 23.4% over the previous quarter, respectively. The progress was mainly attributable to Falcon Network Technology’s constant enrichment of platform content and improvement of user experience, which contributed to continuous enhancement of user loyalty. Meanwhile, under the positive influence of homebound life due to the pandemic, more and more consumers chose large-screen TV as the entertainment terminal.
# Overseas
Revenue from overseas Internet business increased by 1,270.9% from HK\$8 million in the first quarter of 2020 to HK\$116 million in the second quarter, mainly due to the overseas Internet revenue of the first half in 2020 recognised in the second quarter.
# Gross Profit and Gross Profit Margin
Due to the Group’s efforts in catching up business in the second quarter of 2020, the overall gross profit of the Group increased by 53.2% from HK\$1,400 million in the first quarter of 2020 to HK\$2,144 million in the second quarter. Moreover, the gross profit margin in the second quarter of 2020 increased by 0.9 percentage point to 20.9% compared with the first quarter of 2020.
# TV Business
# Overseas
The gross profit margin of the Group’s TCL brand TV in the overseas markets decreased by 0.8 percentage point from 17.8% in the first quarter of 2020 to 17.0% in the second quarter. The change was mainly attributable to adjustment of regional structure. Rapid growth was seen in the European and emerging markets with high gross profit in the first quarter of 2020, while the business in North America with low gross profit (low expenses) grew fast in the second quarter. |
7490661_252.pdf | en | # 28 Derivative financial instruments
<table><tr><td rowspan="2"></td><td rowspan="2">Note</td><td>2020</td><td>2019</td></tr><tr><td>HK$’m</td><td>HK$’m</td></tr><tr><td>Derivative financial assets</td><td></td><td></td><td></td></tr><tr><td>Cross currency swaps</td><td>(a)</td><td>0.2</td><td>34.4</td></tr><tr><td>Interest rate swaps</td><td>(b)</td><td>1,493.0</td><td>–</td></tr><tr><td>Fuel price swaps</td><td></td><td>–</td><td>5.6</td></tr><tr><td>Foreign currency forward contracts</td><td></td><td>0.6</td><td>–</td></tr><tr><td>Put option</td><td>(c)</td><td>478.9</td><td>–</td></tr><tr><td></td><td></td><td>1,972.7</td><td>40.0</td></tr><tr><td>Represented by</td><td></td><td></td><td></td></tr><tr><td>Non-current assets</td><td></td><td>1,972.0</td><td>34.4</td></tr><tr><td>Current assets</td><td></td><td>0.7</td><td>5.6</td></tr><tr><td></td><td></td><td>1,972.7</td><td>40.0</td></tr><tr><td>Derivative financial liabilities</td><td></td><td></td><td></td></tr><tr><td>Cross currency swaps</td><td>(a)</td><td>(92.9)</td><td>–</td></tr><tr><td>Interest rate swaps</td><td></td><td>(3.6)</td><td>(15.3)</td></tr><tr><td>Fuel price swaps</td><td></td><td>(141.5)</td><td>(5.3)</td></tr><tr><td>Foreign currency forward contracts</td><td></td><td>(0.4)</td><td>(11.5)</td></tr><tr><td></td><td></td><td>(238.4)</td><td>(32.1)</td></tr><tr><td>Represented by</td><td></td><td></td><td></td></tr><tr><td>Non-current liabilities</td><td></td><td>(140.7)</td><td>(8.3)</td></tr><tr><td>Current liabilities</td><td></td><td>(97.7)</td><td>(23.8)</td></tr><tr><td></td><td></td><td>(238.4)</td><td>(32.1)</td></tr></table>
# (a) Cross currency swaps
As at 30 June 2020, the Group has certain cross currency swap contracts designated as cash flow hedges against its foreign currency risk in respect of cash flows from certain bond investments and bank loan with total notional amount of US\$122.9 million (2019: Nil) and HK\$1,005.7 million (2019: Nil), respectively, and with maturities ranging from 2020 to 2029. These cross currency swap contracts are entered with several counterparties over the counter. The Group seeks to hedge the foreign currency risk by the exchange of payments denominated in targeted currency, and applies a hedge ratio of 1:1. The existence of an economic relationship between the cross currency swap contracts and the highly probable forecast transactions/actual transaction is determined based on their currency amounts and the timing of their respective cash flows. The terms of the cross currency swap contracts have been negotiated to match the terms of the underlying bond investments and bank loan. The cash flow hedges were assessed to be highly effective and the related cumulative losses in the hedge reserve amounted to HK\$72.9 million (2019: Nil). |
7490661_253.pdf | en | # 28 Derivative financial instruments (continued)
# (b) Interest rate swaps
As at 30 June 2020, the Group’s insurance business has certain forward starting swap contracts designated as cash flow hedges against its interest rate risk in respect of bonds to be purchased in the future. Under the contracts, the Group’s insurance business will be entitled to receive fixed rate of around 4% to 5% per annum, and required to pay floating rate of 3-month LIBOR, in USD published by the British Banker’s Association. The total notional amount was US\$450.0 million (2019: Nil).The cash flow hedge was assessed to be highly effective and the related cumulative gains in the hedge reserve amounted to HK\$477.9 million (2019: Nil).
The Group’s insurance business seeks to hedge the interest rate risk by the exchange of payments benchmarked against the targeted fixed interest rate. The Group’s insurance business applies an approximate hedge ratio of 1:1 and determines the existence of an economic relationship between the forward starting swap contracts and the debt security investments by matching their critical terms, including the reference interest rates and interest payments.
As at 30 June 2020, the Group’s insurance business received HK\$1,582.0 million (2019: Nil) cash and bank balance from counterparties (note 39) as collateral which are repayable on demand. Interest is calculated on overnight federal fund rate and payable to counterparties.
# (c) Put option
As at 30 June 2020, the Group’s insurance business holds a put option to sell or dispose of an equity investment held by the Group, which is classified as financial assets at FVOCI, at a specified price within a specified transaction period. As at 30 June 2020, the fair value of the underlying equity investment amounted to HK\$252.3 million (2019: Nil).
# 29 Other non-current assets
<table><tr><td rowspan="2"></td><td rowspan="2">Note</td><td>2020</td><td>2019</td></tr><tr><td>HK$’m</td><td>HK$’m</td></tr><tr><td>Deposits paid for acquisition of a subsidiary</td><td>50(b)</td><td>–</td><td>3,120.0</td></tr><tr><td>Security deposits</td><td></td><td>400.7</td><td>852.2</td></tr><tr><td>Deferred tax assets</td><td>40</td><td>22.8</td><td>28.0</td></tr><tr><td>Policy loans</td><td></td><td>478.4</td><td>–</td></tr><tr><td>Others</td><td></td><td>296.8</td><td>3.3</td></tr><tr><td></td><td></td><td>1,198.7</td><td>4,003.5</td></tr></table> |
2912197_68.pdf | en | <table><tr><td rowspan="2"></td><td rowspan="2">NOTE
附註</td><td>2018
2018年</td><td>2017
2017年</td></tr><tr><td>HK$
港元</td><td>HK$
港元</td></tr><tr><td>Total comprehensive expense 應佔全面開支總額：
attributable to:</td><td></td><td></td><td></td></tr><tr><td>Owners of the Company 本公司擁有人</td><td></td><td>(37,303,735)</td><td>(15,360,658)</td></tr><tr><td>Non-controlling interests 非控股權益</td><td></td><td>(1,067,371)</td><td>(2,007,541)</td></tr><tr><td></td><td></td><td>(38,371,106)</td><td>(17,368,199)</td></tr><tr><td>From continuing and discontinued 自持續及終止經營業務
operations</td><td></td><td></td><td></td></tr><tr><td>Loss per share 每股虧損</td><td></td><td></td><td></td></tr><tr><td>Basic and diluted (HK Cents) 基本及攤薄（港仙）</td><td>16</td><td>(0.43)</td><td>(0.18)</td></tr><tr><td>From continuing operations 自持續經營業務</td><td></td><td></td><td></td></tr><tr><td>Loss per share 每股虧損</td><td></td><td></td><td></td></tr><tr><td>Basic and diluted (HK Cents) 基本及攤薄（港仙）</td><td>16</td><td>(0.43)</td><td>(0.25)</td></tr></table> |
2912197_69.pdf | en | <table><tr><td rowspan="2"></td><td rowspan="2">NOTES
附註</td><td>2018
2018年</td><td>2017
2017年</td></tr><tr><td>HK$
港元</td><td>HK$
港元</td></tr><tr><td>Non-current assets 非流動資產</td><td></td><td></td><td></td></tr><tr><td>Plant and equipment 器械及設備</td><td>17</td><td>2,675,374</td><td>1,440,279</td></tr><tr><td>Investment property 投資物業</td><td>18</td><td>–</td><td>12,900,000</td></tr><tr><td>Goodwill 商譽</td><td>19</td><td>1,399,146</td><td>–</td></tr><tr><td>Intangible assets 無形資產</td><td>20</td><td>330,000</td><td>–</td></tr><tr><td>Equity instruments at fair value 按公平值計入其他
through other comprehensive income 全面收益的股本工具</td><td>22</td><td>1,423,467</td><td>–</td></tr><tr><td>Deposit paid for acquisition 收購一間聯營公司的已付按金
of an associate</td><td>26</td><td>16,600,000</td><td>–</td></tr><tr><td>Rental deposits 租金按金</td><td>26</td><td>570,604</td><td>–</td></tr><tr><td></td><td></td><td>22,998,591</td><td>14,340,279</td></tr><tr><td>Current assets 流動資產</td><td></td><td></td><td></td></tr><tr><td>Financial assets at fair value 按公平值計入損益
through profit or loss 的金融資產</td><td>23</td><td>1,062,000</td><td>2,907,000</td></tr><tr><td>Amount due from a former 應收前股東款項
shareholder</td><td>24</td><td>–</td><td>2,510</td></tr><tr><td>Loan receivables 應收貸款</td><td>25</td><td>6,975,770</td><td>–</td></tr><tr><td>Trade and other receivables 貿易及其他應收款項</td><td>26</td><td>4,371,950</td><td>5,028,934</td></tr><tr><td>Tax recoverable 可收回稅項</td><td></td><td>–</td><td>657,372</td></tr><tr><td>Bank balances and cash 銀行結餘及現金</td><td>27</td><td>10,686,511</td><td>41,955,423</td></tr><tr><td></td><td></td><td>23,096,231</td><td>50,551,239</td></tr><tr><td>Current liabilities 流動負債</td><td></td><td></td><td></td></tr><tr><td>Trade and other payables 貿易及其他應付款項</td><td>28</td><td>7,575,844</td><td>6,253,027</td></tr><tr><td>Contract liabilities 合約負債</td><td>29</td><td>550,785</td><td>–</td></tr><tr><td>Other borrowing 其他借款</td><td>30</td><td>10,000,000</td><td>–</td></tr><tr><td>Tax payable 應付稅項</td><td></td><td>117,353</td><td>68,898</td></tr><tr><td>Amounts due to a non-controlling 應付一間附屬公司
shareholder of a subsidiary 非控股股東的款項</td><td>31</td><td>113,953</td><td>113,953</td></tr><tr><td>Bank overdrafts 銀行透支</td><td>27</td><td>2,894,173</td><td>–</td></tr><tr><td></td><td></td><td>21,252,108</td><td>6,435,878</td></tr><tr><td>Net current assets 流動資產淨值</td><td></td><td>1,844,123</td><td>44,115,361</td></tr><tr><td>Total assets less current liabilities 總資產減流動負債
and net assets 及資產淨值</td><td></td><td>24,842,714</td><td>58,455,640</td></tr></table> |
11686646_18.pdf | en | 17
# BOARD OF DIRECTORS (continued)
# Meetings of the Board and Directors’ Attendance Records
The regular meeting of the Board is scheduled four times a year at approximately quarterly intervals with notice given to the Directors at least 14 days in advance. For all other Board meetings, notice will be given in a reasonable time in advance. The Directors are allowed to include any matter in the agenda that is required for discussion and resolution at the meeting. To enable the Directors to be properly briefed on issues arising at each of the Board meetings and to make informed decisions, an agenda and the accompanying Board papers will be sent to all Directors at least three days before the intended date of the Board meeting, or such other period as agreed. The company secretary of the Company (the “Company Secretary”) is responsible for keeping all Board meetings’ minutes. Draft and final versions of the minutes will be circulated to the Directors for comments and record respectively within a reasonable time after each meeting and the final version is open for the Directors’ inspection.
The attendance record of each Director in respect of the meetings of the Board, Audit Committee, Remuneration Committee, Nomination Committee as well as the annual general meeting on 31 July 2020 (the “AGM”) is set out below:
<table><tr><td rowspan="2">Name of directors</td><td colspan="5">Attendance/Number of Meetings</td></tr><tr><td>Board</td><td>Audit
Committee</td><td>Remuneration
Committee</td><td>Nomination
Committee</td><td>AGM</td></tr><tr><td>Executive Directors:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Mr. Kwong</td><td>4/4</td><td>N/A</td><td>N/A</td><td>1/1</td><td>1/1</td></tr><tr><td>Ms. Kwong</td><td>4/4</td><td>N/A</td><td>N/A</td><td>N/A</td><td>1/1</td></tr><tr><td>Mr. Lam</td><td>4/4</td><td>N/A</td><td>N/A</td><td>N/A</td><td>1/1</td></tr><tr><td>Independent Non-executive
Directors:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Mr. Lai</td><td>3/4</td><td>4/5</td><td>2/2</td><td>N/A</td><td>1/1</td></tr><tr><td>Dr. Cheng</td><td>4/4</td><td>5/5</td><td>2/2</td><td>1/1</td><td>1/1</td></tr><tr><td>Mr. Kwok</td><td>4/4</td><td>5/5</td><td>2/2</td><td>1/1</td><td>1/1</td></tr></table>
The Board held a meeting on 18 June 2021 and, amongst other matters, considered and approved the audited consolidated financial statements of the Group for the Year.
Apart from the Board meetings above, consents and/or approvals of the Board were also obtained by way of written resolutions on a number of matters. |
11686646_19.pdf | en | # 18
# BOARD OF DIRECTORS (continued)
# Board Diversity Policy
The Board adopted a policy of the Board diversity, including the measurable objectives set for implementing the same on 23 March 2018. The Nomination Committee will review these objectives regularly.
The Company recognises and embraces the benefits of a diversity of Board members. It endeavours to ensure that the Board has a balance of skills, experience and diversity of perspectives appropriate to the requirements of the Company’s business. All Board nominations, appointments and re-appointments will continue to be made on a merit basis with due regard for the benefits of diversity of the Board members and the nomination policy of the Company. Selection of candidates will be based on a range of diversity perspectives, including but not limited to gender, age, cultural and educational background, ethnicity, professional experience, skills and knowledge.
# CHAIRMAN AND CHIEF EXECUTIVE
Code provision A.2.1 of the CG Code stipulates that the roles of chairman and chief executive should be separate and should not be performed by the same individual. During the Year, Mr. Kwong was the Chairman and the chief executive officer (the “CEO”) of our Group. In view of the fact that Mr. Kwong has been operating and managing the Group since 2000, the Board believes that it is in the best interest of the Group to have Mr. Kwong taking up both roles for effective management and business development. Therefore, the Board considers that the deviation from code provision A.2.1 of the CG Code is appropriate in such circumstance.
# BOARD COMMITTEES
The Board has established four Board committees, namely the Audit Committee, the Nomination Committee, the Remuneration Committee and Executive Committee to oversee particular aspects of the Company’s affairs. The Board committees are provided with sufficient resources to discharge their duties.
# Audit Committee
The Audit Committee was established on the Listing Date with written terms of reference in compliance with the CG Code. The written terms of reference of the Audit Committee are published on the respective websites of the Stock Exchange and the Company. The Audit Committee comprises all the INEDs, namely Mr. Lai, Dr. Cheng and Mr. Kwok. Mr. Lai is the chairman of the Audit Committee. |
11763950_584.pdf | en | # 綜合全面虧損表
<table><tr><td rowspan="3"></td><td rowspan="3">附註</td><td colspan="2">截至12月31日止年度</td></tr><tr><td>2019年</td><td>2020年</td></tr><tr><td>人民幣千元</td><td> 人民幣千元</td></tr><tr><td>行政開支............................</td><td>8</td><td>(32,004)</td><td>(76,893)</td></tr><tr><td>研發開支............................</td><td>8</td><td>(210,201)</td><td>(281,752)</td></tr><tr><td>其他收入............................</td><td>6</td><td>13,328</td><td>9,977</td></tr><tr><td>其他收益淨額 ........................</td><td>7</td><td>1,477</td><td>21,623</td></tr><tr><td>經營虧損............................</td><td></td><td>(227,400)</td><td>(327,045)</td></tr><tr><td>財務收入............................</td><td>10</td><td>1,429</td><td>763</td></tr><tr><td>財務成本............................</td><td>10</td><td>(887)</td><td>(13,480)</td></tr><tr><td>財務收入╱（成本）淨額 ................</td><td>10</td><td>542</td><td>(12,717)</td></tr><tr><td>發行予投資者的金融工具的公平值變動 ...</td><td>28</td><td>(38,275)</td><td>(724,287)</td></tr><tr><td>除所得稅前虧損 ......................</td><td></td><td>(265,133)</td><td>(1,064,049)</td></tr><tr><td>所得稅開支..........................</td><td>11</td><td>–</td><td>–</td></tr><tr><td>貴公司權益持有人應佔年內虧損 .........</td><td></td><td>(265,133)</td><td>(1,064,049)</td></tr><tr><td>其他全面收益：</td><td></td><td></td><td></td></tr><tr><td>可能重新分類至損益的項目
附屬公司換算匯兌差額 ................</td><td></td><td>(8,901)</td><td>55,683</td></tr><tr><td>不會重新分類至損益的項目
貴公司換算匯兌差額 ..................</td><td></td><td>(2,342)</td><td>29,024</td></tr><tr><td>因 貴公司自身信貸風險產生的發行予
投資者的金融工具的公平值變動 .......</td><td>28</td><td>(4,485)</td><td>34,104</td></tr><tr><td></td><td></td><td>(6,827)</td><td>63,128</td></tr><tr><td>年內其他全面（虧損）╱ 收益（扣除稅項）...</td><td></td><td>(15,728)</td><td>118,811</td></tr><tr><td>貴公司權益持有人應佔年內全面虧損
總額 .............................</td><td></td><td>(280,861)</td><td>(945,238)</td></tr><tr><td>貴公司權益持有人應佔每股虧損（人民幣元）
（附註）</td><td></td><td></td><td></td></tr><tr><td>每股基本及攤薄虧損 ..................</td><td>12</td><td>（1.34）</td><td>（5.37）</td></tr></table> |
11763950_585.pdf | en | # 綜合財務狀況表
<table><tr><td rowspan="3"></td><td rowspan="3">附註</td><td colspan="2">於12月31日</td></tr><tr><td>2019年</td><td>2020年</td></tr><tr><td>人民幣千元</td><td> 人民幣千元</td></tr><tr><td>資產</td><td></td><td></td><td></td></tr><tr><td>非流動資產</td><td></td><td></td><td></td></tr><tr><td>物業、廠房及設備 ....................</td><td>13</td><td>153,644</td><td>129,630</td></tr><tr><td>使用權資產..........................</td><td>14</td><td>18,023</td><td>27,139</td></tr><tr><td>無形資產............................</td><td>15</td><td>28,371</td><td>23,521</td></tr><tr><td>其他非流動資產及預付款項.............</td><td>16</td><td>10,773</td><td>17,766</td></tr><tr><td></td><td></td><td>210,811</td><td>198,056</td></tr><tr><td>流動資產</td><td></td><td></td><td></td></tr><tr><td>其他應收款項 ........................</td><td>17</td><td>2,782</td><td>2,418</td></tr><tr><td>其他流動資產及預付款項...............</td><td>18</td><td>15,742</td><td>10,408</td></tr><tr><td>現金及現金等價物 ....................</td><td>19</td><td>96,476</td><td>1,042,969</td></tr><tr><td></td><td></td><td>115,000</td><td>1,055,795</td></tr><tr><td>資產總值............................</td><td></td><td>325,811</td><td>1,253,851</td></tr><tr><td>權益及負債</td><td></td><td></td><td></td></tr><tr><td>貴公司權益持有人應佔權益</td><td></td><td></td><td></td></tr><tr><td>股本 ...............................</td><td>21</td><td>–</td><td>–</td></tr><tr><td>儲備 ...............................</td><td>22</td><td>26,150</td><td>146,675</td></tr><tr><td>累計虧損............................</td><td></td><td>(758,754)</td><td>(1,822,803)</td></tr><tr><td>權益虧絀總額 ........................</td><td></td><td>(732,604)</td><td>(1,676,128)</td></tr><tr><td>負債</td><td></td><td></td><td></td></tr><tr><td>非流動負債</td><td></td><td></td><td></td></tr><tr><td>發行予投資者的金融工具...............</td><td>28</td><td>–</td><td>2,745,584</td></tr><tr><td>借款 ...............................</td><td>25</td><td>16,358</td><td>11,981</td></tr><tr><td>租賃負債............................</td><td>26</td><td>4,968</td><td>14,016</td></tr><tr><td>遞延收入............................</td><td>27</td><td>15,719</td><td>13,167</td></tr><tr><td></td><td></td><td>37,045</td><td>2,784,748</td></tr><tr><td>流動負債</td><td></td><td></td><td></td></tr><tr><td>發行予投資者的金融工具...............</td><td>28</td><td>937,412</td><td>–</td></tr><tr><td>借款 ...............................</td><td>25</td><td>24,146</td><td>68,371</td></tr><tr><td>租賃負債............................</td><td>26</td><td>5,857</td><td>5,890</td></tr><tr><td>遞延收入............................</td><td>27</td><td>702</td><td>3,591</td></tr><tr><td>應計費用及其他應付款項...............</td><td>29</td><td>53,253</td><td>67,379</td></tr><tr><td></td><td></td><td>1,021,370</td><td>145,231</td></tr><tr><td>負債總額............................</td><td></td><td>1,058,415</td><td>2,929,979</td></tr><tr><td>權益及負債總額 ......................</td><td></td><td>325,811</td><td>1,253,851</td></tr></table> |
20748374_219.pdf | en | any Guarantor to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, will be reinstated in full force and effect.
(d) Each Guarantor agrees that it will not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby. Each Guarantor further agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (1) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes of its Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed thereby, and (2) in the event of any declaration of acceleration of such obligations as provided in Article 6 hereof, such obligations (whether or not due and payable) will forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee. The Guarantors will have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Note Guarantee.
# Section 10.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of such Guarantor will be limited to the maximum amount that will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under this Article 10, result in the obligations of such Guarantor under its Note Guarantee not constituting a fraudulent transfer or conveyance.
# Section 10.03 Note Guarantee
The Note Guarantee of any Guarantor shall be evidenced solely by its execution and delivery of this Indenture (or, in the case of any Guarantor that is not party to this Indenture on the date of this Indenture, a supplemental indenture hereto) and not by an endorsement on, or attachment to, any Note of any Note Guarantee or notation thereof. To effect any Note Guarantee of any Guarantor not party to this Indenture on the date of this Indenture, such future Guarantor shall execute and deliver a supplemental indenture substantially in the form attached as Exhibit B hereto, which supplemental indenture shall be executed and delivered on behalf of such Guarantor by an Officer of such Guarantor.
# Section 10.04 Evidenced by Indenture; No Notation of Subsidiary Guarantee.
Each Guarantor hereby agrees that its Note Guarantee set forth in Section 10.01 hereof will remain in full force and effect notwithstanding any failure to endorse on any Note a notation of such Note Guarantee.
The delivery of any Note by the Trustee, after the authentication thereof hereunder, will constitute due delivery of the Note Guarantee set forth in this Indenture on behalf of each of the Guarantors.
Section 10.05 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 10.05 hereof, no Guarantor may sell or otherwise dispose of all or substantially all of its assets to, or consolidate with or merge with or into (whether or not such Guarantor is the surviving Person) another Person, other than the Issuers or another Guarantor, unless:
(1) immediately after giving effect to such transaction, no Default or Event of Default exists; and
(2) either:
(a) subject to Section 10.05 hereof, the Person acquiring the property in any such sale or disposition or the Person formed by or surviving any such consolidation or merger is a Guarantor, or unconditionally assumes all the obligations of that Guarantor under this Indenture and its Note Guarantee on the terms set forth herein or therein, pursuant to a supplemental indenture in form and substance reasonably satisfactory to the Trustee; or
(b) the Net Proceeds of such sale or other disposition are applied in accordance with the applicable provisions of this Indenture, including without limitation, Section 4.10 hereof.
In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the Note Guarantee endorsed |
20748374_220.pdf | en | upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by the Guarantor, such successor Person will succeed to and be substituted for the Guarantor with the same effect as if it had been named herein as a Guarantor. Such successor Person thereupon may cause to be signed any or all of the Note Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Issuers and delivered to the Trustee. All the Note Guarantees so issued will in all respects have the same legal rank and benefit under this Indenture as the Note Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Note Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding clauses 2(a) and (b) above, nothing contained in this Indenture or in any of the Notes will prevent any consolidation or merger of a Guarantor with or into the Issuers or another Guarantor, or will prevent any sale or conveyance of the property of a Guarantor as an entirety or substantially as an entirety to the Issuers or another Guarantor.
# Section 10.06 Releases.
The Note Guarantee of a Guarantor will be released:
(1) in connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by way of merger or consolidation) to a Person that is not (either before or after giving effect to such transaction) TLLP or a Restricted Subsidiary of TLLP, if the sale or other disposition does not violate Section 4.10 hereof;
(2) in connection with any sale or other disposition of the Capital Stock of that Guarantor after which the applicable Guarantor is no longer a Restricted Subsidiary of TLLP, if the sale or other disposition does not violate Section 4.10 hereof;
(3) if TLLP designates any Restricted Subsidiary that is a Guarantor to be an Unrestricted Subsidiary in accordance with Section 4.17 hereof;
(4) upon the release or discharge of the guarantee by such Guarantor with respect to the Indebtedness under the Credit Agreements or the guarantee that resulted in the creation of such Guarantee; provided, however, that release or discharge of the guarantee by such Guarantor with respect to Indebtedness under the Existing Notes occurs prior to or contemporaneously therewith; provided, further, however, that if, at any time following such release, that Guarantor later guarantees Indebtedness of any Issuer under the Credit Agreements, then such Guarantor shall provide a Note Guarantee at such time if required in accordance with Section 4.16 hereof;
(5) upon the merger, amalgamation or consolidation of such Guarantor with and into an Issuer or another Guarantor that is the surviving Person in such merger, amalgamation or consolidation, or upon the liquidation or dissolution of such Guarantor;
(6) upon Legal Defeasance or Covenant Defeasance in accordance with Article 8 hereof or upon satisfaction and discharge in accordance with Article 11 hereof; or
# (7) in accordance with Article 9 hereof.
Any Guarantor not released from its obligations under its Note Guarantee as provided in this Section 10.06 will remain liable for the full amount of principal of and interest and premium, if any, on the Notes and for the other obligations of any Guarantor under this Indenture as provided in this Article 10.
# ARTICLE 11
# SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge.
This Indenture will be discharged and will cease to be of further effect as to all Notes issued hereunder, when:
(1) either:
(a) all Notes that have been authenticated, except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust and thereafter repaid to the Issuers, have been delivered to the Trustee for cancellation; or |
20735676_37.pdf | en | # Fire Prevention and Road Traffic Safety
In accordance with the Fire Protection Law of the People’s Republic of China (《中華人民共和國消防法》) and the Regulations on Fire Prevention for Governmental Departments, Entities, Enterprises, and Institutions (《機關、團體、企業、事業單位消防安全管理規定》) issued by the Ministry of Public Security and other relevant laws and regulations, QHD Port has formulated the Supervision and Management Measures for Fire Prevention of Qinhuangdao Port Co., Ltd. (《秦皇島港股份有限公司消防安全監督管理辦法》), the Administrative Measures for Fire Prevention Archive of Qinhuangdao Port Co., Ltd. (《秦皇島港股份有限公司消防檔案管理辦法》) and other relevant systems, improved fire prevention management, prevented fire risks and improved risk response capabilities.
The Company has established a long-term mechanism on weekly fire prevention inspections, which is implemented from the Company as a whole to the grassroots teams as a whole to effectively eliminate potential fire safety hazards. It organized evaluation on fire prevention and rectified potential safety hazards in a timely manner. The Company strictly examines and approves the use of fire and strengthens the construction of emergency response capabilities on fire prevention. It built 50 new miniature fire stations in key areas such as substation and high-rise buildings and held “special emergency exercises for traffic and fire prevention”, effectively improving employees’ capabilities to respond to dangers.
The Company formulated the Supervision and Management Measures for Road Traffic Safety at the Port of Qinhuangdao Port Co., Ltd. (《秦皇島港股份有限公司港口道路交通安全監督管理辦法》) in accordance with the Road Traffic Safety Law of the People’s Republic of China (《中華人民共和國道路交通安全法》), the Regulation on the Implementation of the Road Traffic Safety Law of the People’s Republic of China (《中華人民共和國道路交通安全法實施條例》) and other relevant laws and regulations to strictly standardize the setting of traffic signs and road traffic facilities in the main business areas of the Company. For driving safety, the Company strictly reviews the qualifications of licensed drivers to ensure that they were obtained in accordance with the laws and conducts reviews regularly.
# Case: QHD Port carries out comprehensive emergency rescue exercises on fire prevention and traffic accidents
On 23 July 2021, QHD Port organized the “Comprehensive Emergency Exercise for Production Safety Accidents and Environmental Emergencies in 2021”. Qinhuangdao Emergency Management Bureau, the Municipal Bureau of Marine Development and Fisheries and the Municipal Fire and Rescue Detachment and other departments observed the exercises.
Site of fire prevention exercises |
20735676_38.pdf | en | # VI. KEEPING ALERT IN BUILDING SAFE PORTS
# 6.3 Protecting Occupational Health
In strict compliance with the Law of the People’s Republic of China on the Prevention and Control of Occupational Diseases (《中華人民共和國職業病防治法》), the Administrative Regulations on Employers’ Protective Equipment of Labor (《用人單位勞動防護用品管理規範》), the Provisions on the Supervision and Administration of Occupational Health at Work Sites (《工作場所職業衛生監督管理規定》) and other relevant laws and regulations, QHD Port formulated the Administrative Measures for Occupational Health Protection of Qinhuangdao Port Co., Ltd. (《秦皇島港股份有限公司職業健康監護管理辦法》), the Administrative Measures for Protective Equipment of Labor of Qinhuangdao Port Co., Ltd. (《秦皇島港股份有限公司勞動防護用品管理辦法》), the Administrative Measures for Workplace’s Occupational Health Supervision of Labor of Qinhuangdao Port Co., Ltd. (《秦皇島港股份有限公司工作場所職業衛生監督管理辦法》) and other internal rules and systems to further perfect occupational health management, enhance the Company’s health management mechanism, improve standardized health management, prevent occupational disease risk for employees and effectively protect the health rights and interests of all employees.
The Company implements a regular health examination system for dangerous positions, adopts targeted control measures on hazards and sets up individual archives for monitoring the occupational health of employees. Meanwhile, the Company actively optimizes the working environment of key positions, strengthens the monitoring on harmful factors to employees and promotes standardized operation of the workplace to fundamentally reduce occupational hazards. In 2021, the Company had no recorded employee occupational disease cases.
# Case: QHD Port actively prevents pandemic risks
In 2021, facing the severe COVID-19 pandemic, QHD Port frequently updated pandemic-related information through its WeChat public account platform and promptly notified employees of the latest adjustments to pandemic prevention and control areas. It kept “zero reports” in monitoring the health of employees at ports on a daily basis, completed nucleic acid testing for on-the-job and retired employees and strengthened management at gates and places with crowds at all levels. The Company implemented closed-loop management for personnel involved in high-risk operations as required and strengthened the management of pandemic prevention and control in centralized offices and public places to prevent the risk of cluster infections. QHD Port actively publicized basic knowledge on health management, advocated employees to voluntarily complete full-process vaccination and reminded employees to pay attention to personal protection and personal health management.
Pandemic prevention personnel sterilize vehicles at the collection and distribution port
Qinhuangdao Port Hospital conducts nucleic acid testing for people at the port |
7505463_28.pdf | en | # Aspect A2: Use of Resources
Given that the business of Vodatel involves no production element, as a system integrator for various IT-related turnkey solutions and services, the use of resources by Vodatel, such as energy, water and other raw materials, in its day-to-day operations is minimal. This aspect is not of great relevance to our cost-structure, which mainly involves purchase of equipment from our suppliers and the associated freight and insurance, salaries and benefits to staff and third-party expenses, e.g. inland transportation and engagement of subcontractors, incurred during the installation of equipment and commissioning of surveillance and \( \Pi \) solutions. Despite that the use of natural resources is not largely relevant to Vodatel, we are aware of our consumption of electricity, water and fuel within an office environment, and will, therefore, focus our ESG improvement efforts in those areas.
# Policies applicable at Vodatel
√ Instil a culture of resource-usage consciousness;
√ Introduction of a framework for assessing resource utilisation, ensuring its optimised application on a systematic basis; and
√ Dissemination of any current-term measure/procedures, relating to resource usage to stakeholders.
<table><tr><td>KPI A2.1</td><td>Details of electricity consumption can be referred to KPI A1.2 above.</td></tr><tr><td>KPI A2.2</td><td>The Macao office consumes around 3,000 cubic metres of water each year.</td></tr><tr><td>KPI A2.3</td><td>Staff are reminded to turn off lihgts and computers when leaving the premises
and the level of electricity consumption is considered reasonable.</td></tr><tr><td>KPI A2.4</td><td>There is no issue in sourcing water that is fit for purpose. The level of water
consumption in pantries and toilets is considered reasonable.</td></tr><tr><td>KPI A2.5</td><td>Details of packaidgng materials use can be referred to KPI A1.4 above.</td></tr></table>
# Aspect A3: The Environment and Natural Resources
Vodatel specialises in the design and system integration of IT infrastructure, hence our operations have little impact on the environment or natural resources apart from those mentioned in the previous section. While we do encourage our employees to practise the “3Rs” and to protect the natural environment, as this aspect has no material relevance to our business, we have opted not to report on it, and KPI A3.1 (concerning the significant impacts of activities on the environment and natural resources and the actions taken to manage them) is not applicable. |
7505463_29.pdf | en | # ESG Report
# B) SOCIAL
Our people are our greatest asset and they are essential to continued growth at Vodatel. We staunchly believe that investing in our people and their development is inseparable from the development and ongoing success of our business.
<table><tr><td>Exchange ESG Guide Aspects</td><td>Material Areas</td></tr><tr><td>B1 Emlpoyment</td><td>Attraction and Retention of Talents, Working Hours and
Rest Periods</td></tr><tr><td>B2 Health and Safety</td><td>Occupational Health and Safety</td></tr><tr><td>B3 Development and Training</td><td>Learning and Training</td></tr><tr><td>B4 Labour Standards</td><td>Human Rihgts</td></tr><tr><td>B5 SulChippy an Management</td><td>Assessment of Sulippers</td></tr><tr><td>B6 Product Responsibility</td><td>Reliable Services and Products</td></tr><tr><td>B7 Anti-corruption</td><td>Anti-Corruption and Anti-Bribery</td></tr><tr><td>B8 Community Investment</td><td>Contribution to the Community</td></tr></table>
# Aspect B1: Employment
Vodatel is an equal opportunity employer which believes strongly in the principles of diversification and anti-discrimination. Our human resources policies are in strict compliance with those labour laws issued by the Governments in different jurisdictions in which we operate, namely Macao, Hong Kong and Mainland China taking the highest standards to be applied across all entities, and other applicable laws and regulations regarding compensation and insurance, employment, promotion and termination of employees. To this end, the employee handbook at Vodatel outlines the benefits and rights enjoyed by all employees.
Attraction and Retention of Talents – With people being our key to success, we offer market-competitive employment packages, consisting of both staff benefits and welfare for all our employees, to ensure that we attract and retain the best people for our business operations. Our comprehensive packages offer discretionary incentives, including bonus scheme, sales commission, Options, medical insurance and retirement protection. We encourage our employees to enjoy a well-balanced work and personal life. In addition to annual leaves, we help our employees to effectively manage their work and life commitments through such policies as marriage and compassionate leave allowances. Promotions are decided within a level-playing field environment and are awarded based on performance and the ability to cohere to teamwork.
Working Hours and Rest Periods – As a system integrator that provides around-the-clock, top quality support services to our customers, many of our engineers are required to be on standby duty in case of emergency and to work during non-office hours and on public holidays. In addition, we provide overtime pay, meal allowance and additional compensation for those on roster. Any compensation on working hours and rest periods are in full compliance with the relevant local employment ordinances. |
20790956_32.pdf | en | As at 31 December 2018, the Group’s total liabilities were RMB21.23 trillion, an increase of RMB902,543 million or 4.44% over 2017. In this amount, deposits from customers amounted to RMB17.11 trillion, up by RMB744,924 million or 4.55% over 2017. Taking into consideration the inclusion of accrued interest, the actual increase was RMB567,675 million or 3.47%. Deposits and placements from banks and non-bank financial institutions increased by RMB127,063 million or 7.38% over 2017 to RMB1,847,697 million. Debt securities issued were RMB775,785 million, an increase of RMB179,259 million or 30.05% over 2017, mainly due to issuance of 2 batches of Tier 2 capital bonds totalling RMB83 billion. Borrowings from central banks were RMB554,392 million, an increase of 1.30% over 2017. Accordingly, in the Group’s total liabilities, deposits from customers accounted for 80.58% of total liabilities, an increase of 0.08 percentage points over 2017. Deposits and placements from banks and non-bank financial institutions accounted for 8.70% of total liabilities, an increase of 0.24 percentage points over 2017. Debt securities issued accounted for 3.66% of total liabilities, an increase of 0.73 percentage points over 2017. Borrowings from central banks accounted for 2.61% of total liabilities, a decrease of 0.08 percentage points from 2017.
# Deposits from customers
The following table sets forth the Group’s deposits from customers by product type as at the dates indicated.
<table><tr><td rowspan="2">(In millions of RMB, except percentages)</td><td colspan="2">31 December 2018</td><td colspan="2">31 December 2017</td><td colspan="2">31 December 2016</td></tr><tr><td>Amount</td><td>% of total</td><td>Amount</td><td>% of total</td><td>Amount</td><td>% of total</td></tr><tr><td>Corporate deposits</td><td>8,667,322</td><td>50.66</td><td>8,700,872</td><td>53.17</td><td>8,008,460</td><td>51.99</td></tr><tr><td>Demand deposits</td><td>5,854,542</td><td>34.22</td><td>5,723,939</td><td>34.98</td><td>5,145,626</td><td>33.41</td></tr><tr><td>Time deposits</td><td>2,812,780</td><td>16.44</td><td>2,976,933</td><td>18.19</td><td>2,862,834</td><td>18.58</td></tr><tr><td>Personal deposits</td><td>7,771,165</td><td>45.42</td><td>7,105,813</td><td>43.43</td><td>6,927,182</td><td>44.98</td></tr><tr><td>Demand deposits</td><td>3,271,246</td><td>19.12</td><td>3,169,395</td><td>19.37</td><td>2,986,109</td><td>19.39</td></tr><tr><td>Time deposits</td><td>4,499,919</td><td>26.30</td><td>3,936,418</td><td>24.06</td><td>3,941,073</td><td>25.59</td></tr><tr><td>Overseas operations and subsidiaries</td><td>492,942</td><td>2.88</td><td>557,069</td><td>3.40</td><td>467,273</td><td>3.03</td></tr><tr><td>Accrued interest</td><td>177,249</td><td>1.04</td><td>N/A</td><td>N/A</td><td>N/A</td><td>N/A</td></tr><tr><td>Total deposits from customers</td><td>17,108,678</td><td>100.00</td><td>16,363,754</td><td>100.00</td><td>15,402,915</td><td>100.00</td></tr></table>
As at 31 December 2018, domestic corporate deposits of the Bank were RMB8,667,322 million, a decrease of 0.39% from 2017, mainly due to the decrease in corporate time deposits as a result of centralised deposits of third-party payment platforms’ settlement reserve funds with the PBC. Domestic personal deposits of the Bank were RMB7,771,165 million, an increase of RMB665,352 million or 9.36% over 2017, and accounted for 47.27% of domestic deposits from customers, up by 2.32 percentage points over 2017. Deposits from overseas operations and subsidiaries amounted to RMB492,942 million, a decrease of RMB64,127 million, and accounted for 2.88% of the total deposits from customers. The Bank’s domestic demand deposits were RMB9,125,788 million, up by RMB232,454 million or 2.61% over 2017, and accounted for 55.51% of the domestic deposits from customers. The time deposits were RMB7,312,699 million, up by RMB399,348 million or 5.78% over 2017, and accounted for 44.49% of domestic deposits from customers, up by 0.75 percentage points over 2017.
# Debt securities issued
The Bank issued no corporate debt securities that were required to be disclosed in accordance with Standards for the Contents and Formats of Information Disclosure by Companies Offering Securities to the Public No. 2 – Contents and Formats of Annual Reports (2017 Revision) and Standards for the Contents and Formats of Information Disclosure by Companies Offering Securities to the Public No. 38 – Contents and Formats of Annual Reports on Corporate Debt Securities. Please refer to Note “Debt securities issued” in the financial statements for details. |
20790956_33.pdf | en | # Shareholder’s equity
The following table sets forth the Group’s total equity and its composition as at the dates indicated.
<table><tr><td>(In millions of RMB)</td><td>As at 31 December 2018</td><td>As at 31 December 2017</td></tr><tr><td>Share capital</td><td>250,011</td><td>250,011</td></tr><tr><td>Other equity instruments – preference shares</td><td>79,636</td><td>79,636</td></tr><tr><td>Capital reserve</td><td>134,537</td><td>135,225</td></tr><tr><td>Investment revaluation reserve</td><td>N/A</td><td>(26,004)</td></tr><tr><td>Other comprehensive income</td><td>18,451</td><td>N/A</td></tr><tr><td>Surplus reserve</td><td>223,231</td><td>198,613</td></tr><tr><td>General reserve</td><td>279,725</td><td>259,680</td></tr><tr><td>Retained earnings</td><td>990,872</td><td>886,921</td></tr><tr><td>Exchange reserve</td><td>N/A</td><td>(4,322)</td></tr><tr><td>Total equity attributable to equity shareholders of the Bank</td><td>1,976,463</td><td>1,779,760</td></tr><tr><td>Non-controlling interests</td><td>15,131</td><td>16,067</td></tr><tr><td>Total equity</td><td>1,991,594</td><td>1,795,827</td></tr></table>
As at 31 December 2018, the Group’s equity was RMB1,991,594 million, an increase of RMB195,767 million or 10.90% over 2017, primarily driven by the increase of RMB103,951 million in retained earnings. Taking into consideration the adjustments made at the beginning of the period in accordance with requirements of the new financial instruments standard, the actual increase was RMB215,218 million or 12.12%. As the growth rate of total equity surpassed that of assets, the ratio of total equity to total assets for the Group reached 8.58%, an increase of 0.46 percentage points over 2017.
# Off-balance sheet items
The Group’s off-balance sheet items include derivatives, commitments and contingent liabilities. Derivatives include interest rate contracts, exchange rate contracts, precious metal contracts, etc. Please refer to Note “Derivatives and Hedge Accounting” in the financial statements of this annual report for details on the nominal amounts and fair value of derivatives. Commitments and contingent liabilities include credit commitments, operating lease commitments, capital commitments, underwriting obligations, redemption obligations, and outstanding litigation and disputes. Among these, credit commitments were the largest component, including undrawn loan facilities which are approved and contracted, unused credit card limits, financial guarantees, and letters of credit. As at 31 December 2018, credit commitments balance was RMB2,848,724 million, a decrease of RMB180,448 million or 5.96% from 2017. Please refer to Note “Commitments and Contingent Liabilities” in the financial statements in this annual report for details on commitments and contingent liabilities.
# Analysis on Cash Flow Statements
# Cash from operating activities
Net cash received from operating activities was RMB615,831 million, an increase of RMB536,741 million over 2017, mainly because the net growth of loans and advances to customers saw a decrease from 2017, and the deposits with central banks, banks and non-bank financial institutions decreased more over 2017 as affected by reserve ratio cuts.
# Cash used in investing activities
Net cash used in investing activities was RMB369,779 million, an increase of RMB272,323 million over 2017, mainly because of the decrease in cash inflows from investing activities due to less proceeds from sale and redemption of investments.
# Cash from financing activities
Net cash from financing activities was RMB28,921 million, an increase of RMB20,129 million over 2017, mainly driven by the increase of proceeds from the issuance of bonds. |
20790390_23.pdf | en | # OPERATING PRACTICES (CONTINUED)
# Moral Integrity and Anti-corruption
The Group adopted the code provisions set out in the Corporate Governance Code under Appendix 14 of the Listing Rules. Board of Directors members are responsible for corporate governance. The Board has delegated certain responsibilities to committees, including the Audit Committee, the Remuneration Committee and the Nomination Committee.
We have ethical commitments and advise our employees not to solicit or accept any advantage or bribes from our contractors or suppliers. We also require our employees to declare any conflict of interest and to avoid creating any possible conflict of interest whilst handling matters with our residents, commercial tenants or contractors or any other persons with whom the Company may have dealings. We also have our code of business conduct binding on all employees to avoid any impropriety. All employees must comply with the CAP 201 Prevention of Bribery Ordinance of Hong Kong when conducting all business and affairs of the Group.
For whistle-blowing procedures apply to all parties including internal as well as external informers. Any complaints or possible breach of this Code can be made either verbally or by confidentially writing to the Audit Committee; all issues will be treated promptly and fairly. In cases of suspected corruption or other criminal offences, a report may be made to the appropriate authority.
As at 30 September 2018, the Group was in compliance with all local rules and regulations relating to bribery, extortion, fraud and money laundering including CAP 201 Prevention of Bribery Ordinance. There were no concluded legal cases regarding corrupt practices brought against the Group or its employees.
# COMMUNITY
# Community Participation
As a good corporate citizen, the Group gives support to various community activities to bring positive environmental and social impacts to our tenants. We identify community events organised by different parties to provide support by various means. For example, the Group has joined the green recycling campaigns launched by the government to promote the importance of environmental protection to our tenants. By using various means of communication such as campaign posters, Facebook, email and notice boards, we trust that our community activities promotions can effectively reach our tenants.
# Focus Areas
To develop an awareness of protection and preservation regarding the environment amongst tenants, the Group has joined the “Skip lunch” campaign” supported by the Community Chest and Art jamming event collaboration with an art centre for free for tenants to join. In addition, for health promotion, we have supported the charity event “Let it beat” organised by World Heart Federation by both donation and charity walk. We have contributed in fund raising to support the Hong Kong College of Cardiology. |
20790390_24.pdf | en | The board of directors (the “Board”) of Pokfulam Development Company Limited (the “Company”) is pleased to present this Corporate Governance Report for the year ended 30 September 2018 (the “Year”).
# CORPORATE GOVERNANCE PRACTICES
The Board considers good corporate governance practices to be essential to the promotion of the value of the Company’s shareholders (the “Shareholders”) value and investors’ confidence.
The Board has adopted all the code provisions (the “Code Provisions”) as set out in the Corporate Governance Code (the “Code”) contained in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange” and the “Listing Rules”, respectively) as the corporate governance code of the Company.
During the Year, the Company has complied with all the Code Provisions as set out in the Code, except for Code Provisions A.2.1 and A.4.1, details of which are explained below. The Company has committed to maintaining high corporate governance standards. The Company devotes considerable efforts to identify and formalize the best corporate governance practices suitable for the Company’s needs. In addition, the Company reviews regularly its organizational structure to ensure that operations are corresponding with good corporate governance practices as set out in the Code.
The key corporate governance principles and practices of the Company are summarized as follows:
# THE BOARD
# Responsibilities
The Board is responsible for leadership and control of the Company and oversees the businesses, strategic decisions and performance of the Company and its subsidiaries (the “Group”). The Board has also established Board committees and has delegated to these Board committees various responsibilities as set out in their respective terms of reference.
The Board reserves for its decisions all major matters of the Company, including approval and monitoring of all policy matters, overall strategies and budgets, internal control and risk management systems, material transactions (in particular those that may involve conflict of interests), financial reports, appointment of directors and other significant financial and operational matters. |
9289594_8.pdf | en | # 2. THE ENVIRONMENT (CONTINUED)
# • Environmental Strategy and Management Approach (Continued)
# A1. Emissions and GHG Emission (Continued)
For detailed emission data please see the table below:
2. 環境（續）
• 環境策略及管理方法（續）
A1. 排放物及溫室氣體排放（續）
有關詳細排放物數據請見下表：
<table><tr><td rowspan="2"></td><td colspan="6">GHG Emission (tCOe2)
溫室氣體排放（公噸二氧化碳當量）</td></tr><tr><td colspan="2">Wanchai Office
灣仔辦公室</td><td colspan="2">The ICON
The ICON</td><td colspan="2">Cheung Kee Garden
張記花園</td></tr><tr><td>Scope 1 Emission
範圍一排放</td><td>GHG Total
溫室氣體總計</td><td>0</td><td>GHG Total
溫室氣體總計</td><td>20.39</td><td>GHG Total
溫室氣體總計</td><td>14.96</td></tr><tr><td>Scope 2 Emission
範圍二排放</td><td>GHG Total
溫室氣體總計</td><td>13.74</td><td>GHG Total
溫室氣體總計</td><td>157.05</td><td>GHG Total
溫室氣體總計</td><td>0.60</td></tr><tr><td>Scope 3 Emission
範圍三排放</td><td>GHG Total
溫室氣體總計</td><td>11.20</td><td>GHG Total
溫室氣體總計</td><td>13.12</td><td>GHG Total
溫室氣體總計</td><td>8.71</td></tr><tr><td>Sub Total
小計</td><td colspan="2">24.94</td><td colspan="2">190.56</td><td colspan="2">24.27</td></tr><tr><td>Total
總計</td><td colspan="2"></td><td colspan="2">239.77</td><td colspan="2"></td></tr></table>
\* The above greenhouse gas emissions are defined and calculated according to the GHG Protocol and HKEX Guidance of ESG report Annex II
\* The above calculation EF is sourced from NDRC & HKEX Guidance of ESG report Annex II
The Group has no hazardous waste discharge in 2018. Totally 20.97 tons of non-hazardous domestic waste is sent to the domestic garbage centralized treatment station for treatment, and the harmful waste water discharge is zero.
\* 上述溫室氣體排放乃根據溫室氣體議定書及香港交易所ESG報告附件2界定及計算。
\* 上述計算EF乃取自中華人民共和國國家發展和改革委員會及香港交易所ESG報告附件2。
於二零一八年，本集團無排放有害廢物。總共20.97公噸之無害生活廢物被送往本地垃圾集中處理站進行處理，及無排放有害廢水。 |
9289594_9.pdf | en | # 2. THE ENVIRONMENT (CONTINUED)
# • Environmental Strategy and Management Approach (Continued)
# A2. Resources Consumption
The main consumption resources of the Group during the Reporting Period are electricity, gas, domestic water, gasoline and diesel.
The Group attaches great importance to the water conservation and energy efficiency in all owned and served properties. Regular maintenance and commissioning of the equipment were taken by the Group.
2. 環境（續）
• 環境策略及管理方法（續）
A2. 資源消耗
本集團於報告期間的主要資源消耗為電力、煤氣、生活用水、汽油及柴油。
本集團重視所有自置及在管物業的節約用水及能源效率。本集團定期對設備進行維護及調試。
<table><tr><td>Resources Consumption
資源使用量</td><td>Unit
單位</td><td>Wanchai
Office
灣仔辦公室</td><td>Century
Elegant
進加</td><td>Cheung
Kee Garden
張記花園</td><td>Total
總計</td></tr><tr><td>Electricity
電力</td><td>kWh
千瓦時</td><td>17,398</td><td>197,594</td><td>761</td><td>215,753</td></tr><tr><td>Gas
煤氣</td><td>MJ
兆焦耳</td><td>0</td><td>1,584</td><td>0</td><td>1,584</td></tr><tr><td>Domestic Water
生活用水</td><td>3m
立方米</td><td>0</td><td>212</td><td>0</td><td>212</td></tr><tr><td>Gasoline
氣油</td><td>L
公升</td><td>N/A
不適用</td><td>686.64</td><td>N/A
不適用</td><td>686.64</td></tr><tr><td>Diesel
柴油</td><td>L
公升</td><td>N/A
不適用</td><td>N/A
不適用</td><td>5,049</td><td>5,049</td></tr></table>
# A3. Environment and Natural Resources
In accordance with the Group’s environmental philosophy, all subsidiary companies are committed to providing high quality services while also ensuring that all business activities impact the environment positively, maintaining the balance between operational efficiency and resource consumption.
A3. 環境及天然資源
根據本集團的環保理念，所有附屬公司致力於提供優質服務，同時確保所有業務活動對環境產生正面影響以及維持營運效率與資源消耗之間的平衡。 |
3433622_299.pdf | en | # 31. RECONCILIATION BETWEEN U.S. GAAP AND INTERNATIONAL FINANCIAL REPORTING STANDARDS (Continued)
# Notes: (Continued)
# (iv) PRC withholding tax
Under U.S. GAAP ASC 740, which was prior to the adoption of ASU 2016-16, a PRC withholding tax liability of US\$26,090, incurred on intragroup transfer of the 100% equity interest in BeiGene Shanghai to BeiGene Guangzhou in 2017, was carried in the Group’s consolidated balance sheet as a prepaid asset as of December 31, 2017.
Under IFRSs, such PRC withholding tax was charged to the Group’s consolidated statement of operations for the year ended December 31, 2017.
Upon the Company’s adoption of ASU 2016-16 on January 1, 2018, the above PRC withholding tax of US\$26,090 incurred in 2017 was charged to the opening accumulated deficit as of January 1, 2018 in the Company’s U.S. GAAP consolidated financial statements. Hence the above difference in accounting treatment between U.S. GAAP and IFRSs no longer existed for the Company’s accounting periods commencing from January 1, 2018.
# (v) Government subsidies
Under U.S. GAAP, the government subsidies of US\$9,620 received in 2017 relating to the above PRC withholding tax was carried in the Group’s consolidated balance sheet as of December 31, 2017, as other long-term liabilities of US\$9,990 (re-translated at December 31, 2017 closing exchange rate), as a result of the recognition of the related PRC withholding tax as a prepaid asset in the balance sheet.
Under IFRSs, the above government subsidies were recognized as income in the Group’s consolidated statement of operations for the year ended December 31, 2017 as a result of the recognition of such PRC withholding tax as an expense in 2017. In addition, the income tax expense of US\$2,405 on the government subsidies deferred as a prepaid asset of US\$2,498 (re-translated at December 31, 2017 closing exchange rate) under ASC 740 was charged as an expense in the Group’s consolidated statement of operations for the year ended December 31, 2017 under IFRSs as a result of the recognition of such government subsidies as income in 2017. Finally, IFRSs adjustments were made in the Group’s consolidated statement of operations for the year ended December 31, 2017 to account for the consequential impact on the Group’s noncontrolling interests of US\$361 arising from the above adjustments of government subsidies and related income tax expense which are applicable to a non-wholly-owned PRC subsidiary.
As a result of the charge of the relevant PRC withholding tax to the opening accumulated deficit as of January 1, 2018 as mentioned above, the government subsidies of US\$9,990 and the related income tax expense of US\$2,498 carried in the balance sheet as of December 31, 2017 were also recognized in the opening accumulated deficit as of January 1, 2018 in the Company’s U.S. GAAP consolidated financial statements, and the consequential effect on noncontrolling interest of US\$375 (re-translated at December 31, 2017 closing exchange rate) and foreign currency translation difference of US\$263 were included within the Company’s opening U.S. GAAP consolidated balance sheet as of January 1, 2018 accordingly, with resulting adjustment included within the 2018 opening accumulated deficit. The overall net impact on 2018 opening accumulated deficit was US\$6,854. Thereafter the above differences in accounting treatment between U.S. GAAP and IFRSs no longer exist for the Company’s accounting periods commencing from January 1, 2018. |
3433622_300.pdf | en | # 32. RECONCILIATION OF THE COMPARATIVE FINANCIAL STATEMENTS WITH THE ACCOUNTANTS’ REPORT IN THE PROSPECTUS
The comparative consolidated financial statements of the Company as of December 31, 2017 in these financial statements was prepared based on the previously published consolidated financial statements in the Company’s 2017 Annual Report on Form 10-K filed with SEC on February 27, 2018. In preparing such financial statements for the year ended December 31, 2017, those new U.S. GAAPs early adopted in preparation of the accountants’ report were not early adopted, and hence differences arose between the Company’s comparative consolidated financial statements as of December 31, 2017 disclosed in these financial statements when compared with the Company’s consolidated financial statements as of December 31, 2017 as disclosed in the accountants’ report.
The reconciliations of the comparative consolidated financial statements of the Company as of December 31, 2017 in this report with the consolidated financial statements of the Company as of December 31, 2017 disclosed in the accountants’ report in the Prospectus are as follows:
<table><tr><td rowspan="2">Consolidated balance sheet data</td><td colspan="5">As of December 31, 2017</td></tr><tr><td>As reported
in these
financial
statements</td><td colspan="3">Adjustments adopted in
’preparing accountants report</td><td>As reported
in the
’
accountantsreport</td></tr><tr><td></td><td>US$</td><td>US$</td><td>US$</td><td>US$</td><td>US$</td></tr><tr><td></td><td></td><td>(i)</td><td>(ii)</td><td>(iii)</td><td></td></tr><tr><td>Unbilled receivable</td><td>—</td><td>16,307</td><td>—</td><td>—</td><td>16,307</td></tr><tr><td>Other non-current assets</td><td>42,915</td><td>—</td><td>(26,090)</td><td>(2,498)</td><td>14,327</td></tr><tr><td>Total assets</td><td>1,046,479</td><td>16,307</td><td>(26,090)</td><td>(2,498)</td><td>1,034,198</td></tr><tr><td>Other long-term liabilities</td><td>31,959</td><td>—</td><td>—</td><td>(9,990)</td><td>21,969</td></tr><tr><td>Total liabilities</td><td>362,248</td><td>—</td><td>—</td><td>(9,990)</td><td>352,258</td></tr><tr><td>Accumulated other comprehensive loss</td><td>(480)</td><td>—</td><td>—</td><td>263</td><td>(217)</td></tr><tr><td>Accumulated deficit</td><td>(330,517)</td><td>16,307</td><td>(26,090)</td><td>6,854</td><td>(333,446)</td></tr><tr><td>Noncontrolling interest</td><td>14,422</td><td>—</td><td>—</td><td>375</td><td>14,797</td></tr><tr><td>Total equity</td><td>684,231</td><td>16,307</td><td>(26,090)</td><td>7,492</td><td>681,940</td></tr></table> |
2593071_117.pdf | en | Cash flows from derivative financial instruments accounted for as hedges are classified in the same category as the item being hedged.
Cash paid for interest and income taxes is as follows:
<table><tr><td rowspan="2">(Dollars in millions)</td><td colspan="3">For years ended December 31,</td></tr><tr><td>2017</td><td>2016</td><td>2015</td></tr><tr><td>Interest, net of amounts caiiptalzed</td><td>$ 263</td><td>$ 280</td><td>$ 265</td></tr><tr><td>Income taxes</td><td>97</td><td>120</td><td>124</td></tr><tr><td>Noncash investing and financing activities:</td><td></td><td></td><td></td></tr><tr><td>Outstandinig trade payables related to captal exdipentures</td><td>27</td><td>34</td><td>10</td></tr><tr><td>(Gain) loss from equity investments</td><td>(14)</td><td>(15)</td><td>(15)</td></tr></table>
# 19. SEGMENT INFORMATION
The Company's products and operations are managed and reported in four operating segments: Additives & Functional Products ("AFP"), Advanced Materials ("AM"), Chemical Intermediates ("CI"), and Fibers.
# Additives & Functional Products Segment
In the AFP segment, the Company manufactures chemicals for products in the transportation, consumables, building and construction, animal nutrition, crop protection, energy, personal and home care, and other markets.
The products the Company manufactures in the coatings and inks additives product line can be broadly classified as polymers and additives and solvents and include specialty coalescents, specialty solvents, paint additives, and specialty polymers. The adhesives resins product line consists of hydrocarbon and rosin resins. The tire additives product line includes insoluble sulfur rubber additives, antidegradant rubber additives, and performance resins. The care chemicals business consists of amine derivativebased building blocks for the production of flocculants and intermediates for surfactants. In the specialty fluids product line, the Company produces heat transfer and aviation fluids products. The animal nutrition business consists of formic acidbased solutions product lines. The crop protection business consists of metambased soil fumigants, thiram and zirambased fungicides, and plant growth regulator products.
<table><tr><td rowspan="2">Product Lines</td><td colspan="3">Percentage of Total Segment Sales</td></tr><tr><td>2017</td><td>2016</td><td>2015</td></tr><tr><td>Coatings and Inks Additives</td><td>23%</td><td>24%</td><td>24%</td></tr><tr><td>Adhesives Resins</td><td>18%</td><td>21%</td><td>21%</td></tr><tr><td>Tire Additives</td><td>17%</td><td>17%</td><td>17%</td></tr><tr><td>Care Chemicals</td><td>17%</td><td>15%</td><td>15%</td></tr><tr><td>Specialty Fluids</td><td>13%</td><td>11%</td><td>11%</td></tr><tr><td>Animal Nutrition and Crop Protection</td><td>12%</td><td>12%</td><td>12%</td></tr><tr><td>Total</td><td>100%</td><td>100%</td><td>100%</td></tr></table>
# Advanced Materials Segment
In the AM segment, the Company produces and markets polymers, films, and plastics with differentiated performance properties for valueadded end uses in transportation, consumables, building and construction, durable goods, and health and wellness markets.
The specialty plastics product line consists of two primary products: copolyesters and cellulose esters. The advanced interlayers product line includes polyvinyl butyral sheet and specialty polyvinyl butyral intermediates. The performance films product line primarily consists of window film and protective film products for aftermarket applied films. |
2593071_118.pdf | en | <table><tr><td rowspan="2">Product Lines</td><td colspan="3">Percentage of Total Segment Sales</td></tr><tr><td>2017</td><td>2016</td><td>2015</td></tr><tr><td>Specialty Plastics</td><td>51%</td><td>50%</td><td>51%</td></tr><tr><td>Advanced Interlayers</td><td>33%</td><td>34%</td><td>33%</td></tr><tr><td>Performance Films</td><td>16%</td><td>16%</td><td>16%</td></tr><tr><td>Total</td><td>100%</td><td>100%</td><td>100%</td></tr></table>
# Chemical Intermediates Segment
The CI segment leverages large scale and vertical integration from the cellulose and acetyl, olefins, and alkylamines streams to support the Company's specialty operating segments with advantaged cost positions. The CI segment sells excess intermediates beyond the Company's internal specialty needs into markets such as industrial chemicals and processing, building and construction, health and wellness, and agrochemicals.
In the intermediates product line, the Company produces olefin derivatives, acetyl derivatives, ethylene, and commodity solvents. The plasticizers product line consists of a unique set of primary nonphthalate and phthalate plasticizers and a range of niche nonphthalate plasticizers. The functional amines product lines include methylamines and salts, and higher amines and solvents.
<table><tr><td rowspan="2">Product Lines</td><td colspan="3">Percentage of Total Segment Sales</td></tr><tr><td>2017</td><td>2016</td><td>2015</td></tr><tr><td>Intermediates</td><td>64%</td><td>65%</td><td>65%</td></tr><tr><td>Plasticizers</td><td>19%</td><td>20%</td><td>20%</td></tr><tr><td>Functional Amines</td><td>17%</td><td>15%</td><td>15%</td></tr><tr><td>Total</td><td>100%</td><td>100%</td><td>100%</td></tr></table>
# Fibers Segment
In the Fibers segment, Eastman manufactures and sells cellulose acetate tow for use in filtration media, primarily cigarette filters. The acetyl chemicals product line consists of triacetin, cellulose acetate flake, and acetyl raw materials for other acetate fiber producers. The acetate yarn product line consists of natural (undyed) acetate and polyester yarn and solutiondyed acetate yarn for use in apparel, home furnishings, and industrial fabrics.
<table><tr><td rowspan="2">Product Lines</td><td colspan="3">Percentage of Total Segment Sales</td></tr><tr><td>2017</td><td>2016</td><td>2015</td></tr><tr><td>Acetate Tow</td><td>77%</td><td>80%</td><td>78%</td></tr><tr><td>AcetlChlPdy emica roucts</td><td>15%</td><td>13%</td><td>14%</td></tr><tr><td>Acetate Yarn</td><td>8%</td><td>7%</td><td>8%</td></tr><tr><td>Total</td><td>100%</td><td>100%</td><td>100%</td></tr></table>
# Other
The Company continues to explore and invest in R&D initiatives such as high performance materials and advanced cellulosics that are aligned with disruptive macro trends such as health and wellness, natural resource efficiency, an increasing middle class in emerging economies, and feeding a growing population. An example of such an initiative is the Eastman microfiber technology platform which leverages the Company's core competency in polyesters, spinning capability, and inhouse application expertise for use in a wide range of applications including liquid and air filtration, high strength packaging in nonwovens, and performance apparel in textiles.
Sales revenue and expense for the Eastman microfiber technology platform growth initiative are shown in the tables below as "Other" sales revenue and operating loss. R&D, pension and other postretirement benefits, and other expenses and income not identifiable to an operating segment are shown in the tables below as "Other" operating earnings (loss). |
11702461_101.pdf | en | <table><tr><td rowspan="2"></td><td rowspan="2">Notes
附註</td><td>2020
二零二零年</td><td>2019
二零一九年</td></tr><tr><td>HK$’000
千港元</td><td>HK$’000
千港元</td></tr><tr><td>Non-current liabilities 非流動負債</td><td></td><td></td><td></td></tr><tr><td>Lease liabilities 租賃負債</td><td>35</td><td>1,246</td><td>1,677</td></tr><tr><td>Deferred tax liabilities 遞延稅項負債</td><td>36</td><td>2,745</td><td>2,927</td></tr><tr><td></td><td></td><td>3,991</td><td>4,604</td></tr><tr><td>Net assets 資產淨值</td><td></td><td>206,617</td><td>245,976</td></tr><tr><td>Capital and reserves 股本及儲備</td><td></td><td></td><td></td></tr><tr><td>Share capital 股本</td><td>37</td><td>77,489</td><td>77,489</td></tr><tr><td>Reserves 儲備</td><td></td><td>128,902</td><td>161,059</td></tr><tr><td>Equity attributable to 本公司擁有人應佔權益
owners of the Company</td><td></td><td>206,391</td><td>238,548</td></tr><tr><td>Non-controlling interests 非控股權益</td><td></td><td>226</td><td>7,428</td></tr><tr><td>Total equity 權益總額</td><td></td><td>206,617</td><td>245,976</td></tr></table>
The consolidated financial statements on pages 96 to 235 were approved and authorised for issue by the board of directors on 19 March 2021 and are signed on its behalf by:
第96頁至第235頁的綜合財務報表經董事會於二零二一年三月十九日批准及授權刊發，並由以下人士代表簽署：
<table><tr><td>Wang Jiawei
王嘉偉</td><td>Lai Yuk Mui
黎玉梅</td></tr><tr><td>Director
董事</td><td>Director
董事</td></tr></table>
The accompanying notes form an integral part of these consolidated financial statements.
隨附的附註構成此等綜合財務報表的一部分。 |
11702461_102.pdf | en | <table><tr><td rowspan="5"></td><td colspan="9">Attributable to the owners of the Company
本公司擁有人應佔</td><td rowspan="4">Non-
controling
interests
非控股權益</td><td rowspan="4">Total
equity
權益總額</td></tr><tr><td rowspan="3">Share
capital
股本</td><td rowspan="3">Share
premium
股份溢價</td><td>Fair value
through other
comprehensive
income reserve</td><td>Special
reserve</td><td>Statutory
reserve</td><td rowspan="3">Translation
reserve
匯兌儲備</td><td rowspan="3">Share-based
compensation
reserve
股份補償儲備</td><td rowspan="3">Accumulated
losses
累計虧損</td><td rowspan="3">Total
總額</td></tr><tr><td>(Note 38(i)
（附註38(i)）</td><td>(Note 38(i)
（附註38(i)）</td><td>(Note 38(ii)
（附註38(ii)）</td></tr><tr><td>按公平值計入
其他全面
收入儲備</td><td>特別儲備</td><td>法定儲備</td></tr><tr><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td><td>HK$’000
千港元</td></tr><tr><td>Balance at 31 December 2018 於二零一八年十二月三十一日之結餘</td><td>77,489</td><td>1,673,299</td><td>–</td><td>4,779</td><td>3,912</td><td>(22,296)</td><td>30,554</td><td>(1,403,119)</td><td>364,618</td><td>13,557</td><td>378,175</td></tr><tr><td>Impact on initial application of HKFRS 16 對初次應用香港財務報告準則第16號的影響</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(92)</td><td>(92)</td><td>(2)</td><td>(94)</td></tr><tr><td>Balance at 1 January 2019 於二零一九年一月一日之結餘</td><td>77,489</td><td>1,673,299</td><td>–</td><td>4,779</td><td>3,912</td><td>(22,296)</td><td>30,554</td><td>(1,403,211)</td><td>364,526</td><td>13,555</td><td>378,081</td></tr><tr><td>Loss for the year 年內虧損</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(127,674)</td><td>(127,674)</td><td>(5,948)</td><td>(133,622)</td></tr><tr><td>Other comprehensive income for the year 年內其他全面收入</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>1,696</td><td>–</td><td>–</td><td>1,696</td><td>(179)</td><td>1,517</td></tr><tr><td>Transferred to accumulated losses 購股權失效時轉撥至累計虧損
upon lapse of share options</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(8,930)</td><td>8,930</td><td>–</td><td>–</td><td>–</td></tr><tr><td>Balance at 31 December 2019 and 於二零一九年十二月三十一日及
1 January 2020 二零二零年一月一日之結餘</td><td>77,489</td><td>1,673,299</td><td>–</td><td>4,779</td><td>3,912</td><td>(20,600)</td><td>21,624</td><td>(1,521,955)</td><td>238,548</td><td>7,428</td><td>245,976</td></tr><tr><td>Loss for the year 年內虧損</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(41,399)</td><td>(41,399)</td><td>(161)</td><td>(41,560)</td></tr><tr><td>Other comprehensive income for the year 年內其他全面收入</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>9,378</td><td>–</td><td>–</td><td>9,378</td><td>543</td><td>9,921</td></tr><tr><td>Transferred to accumulated losses upon lapse 購股權失效時轉撥至累計虧損
of share options</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(21,624)</td><td>21,624</td><td>–</td><td>–</td><td>–</td></tr><tr><td>Fair value gains on financial assets at fair value through 按公平值計入其他全面收入之金融資產之
other comprehensive income 公平值收益</td><td>–</td><td>–</td><td>1,106</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>1,106</td><td>58</td><td>1,164</td></tr><tr><td>Transferred to accumulated losses upon 出售按公平值計入其他全面收入之
disposal of financial assets at fair value 金融資產儲備時轉撥至累計虧損
through other comprehensive income reserve</td><td>–</td><td>–</td><td>(1,106)</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(1,106)</td><td>(58)</td><td>(1,164)</td></tr><tr><td>Acquisition of additional interest in subsidiaries 收購附屬公司之額外權益（附註21(1)及(2)）
(notes 21(1) and (2)</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>–</td><td>(136)</td><td>(136)</td><td>(7,584)</td><td>(7,720)</td></tr><tr><td>Balance at 31 December 2020 於二零二零年十二月三十一日之結餘</td><td>77,489</td><td>1,673,299</td><td>–</td><td>4,779</td><td>3,912</td><td>(11,222)</td><td>–</td><td>(1,541,866)</td><td>206,391</td><td>226</td><td>206,617</td></tr></table>
The accompanying notes form an integral part of these consolidated financial statements.
隨附的附註構成此等綜合財務報表的一部分。 |
3426868_52.pdf | en | # 10. Earnings/ (loss) per share - continued
# (b) Diluted earnings/ (loss) per share - continued
Diluted earnings/ (loss) per share attributable to equity holders of the Company are calculated as follows:
<table><tr><td></td><td>2015</td><td>2014</td></tr><tr><td>Net pro t/ (loss) attributable to equity holders of the Company and used to
determine diluted earnings per share (S$’000)</td><td>1,299</td><td>(4,968)</td></tr><tr><td>Weighted average number of ordinary shares outstanding for
basic earnings/ (loss) per share (‘000)</td><td>781,909</td><td>771,595</td></tr><tr><td>Adjustments for (‘000)</td><td></td><td></td></tr><tr><td>- Share options</td><td>12,278</td><td>13,478</td></tr><tr><td>- Warrants</td><td>1,126,926</td><td>254,331</td></tr><tr><td></td><td>1,921,113</td><td>1,039,404</td></tr><tr><td>Diluted earnings/ (loss) per share (cent per share)</td><td>0.07</td><td>(0.64)*</td></tr></table>
\* As loss was recorded, the dilutive potential shares from share options and warrants are anti-dilutive and no change is made to the diluted loss per share.
# 11. Cash and cash equivalents
<table><tr><td rowspan="3"></td><td colspan="2">Group</td><td colspan="2">Company</td></tr><tr><td>2015</td><td>2014</td><td>2015</td><td>2014</td></tr><tr><td>S$’000</td><td>S$’000</td><td>S$’000</td><td>S$’000</td></tr><tr><td>Cash at bank and on hand</td><td>7,365</td><td>4,185</td><td>548</td><td>286</td></tr><tr><td>Short-term bank deposits</td><td>3,520</td><td>2,363</td><td>-</td><td>-</td></tr><tr><td></td><td>10,885</td><td>6,548</td><td>548</td><td>286</td></tr></table>
For the purpose of presenting the consolidated statement of cash flows, cash and cash equivalents comprise the following:
<table><tr><td rowspan="3"></td><td colspan="2">Group</td></tr><tr><td>2015</td><td>2014</td></tr><tr><td> S$’000</td><td>S$’000</td></tr><tr><td>Cash and bank balances (as above)</td><td>10,885</td><td>6,548</td></tr><tr><td>Less: Bank overdraft (Note 18)</td><td>(213)</td><td>(991)</td></tr><tr><td>Cash and cash equivalents per consolidated statement of cash flows</td><td>10,672</td><td>5,557</td></tr></table> |
3426868_53.pdf | en | # 12. Trade and other receivables
<table><tr><td rowspan="3"></td><td colspan="2">Group</td><td colspan="2">Company</td></tr><tr><td>2015</td><td>2014</td><td>2015</td><td>2014</td></tr><tr><td>S$’000</td><td>S$’000</td><td>S$’000</td><td>S$’000</td></tr><tr><td>Trade receivables</td><td></td><td></td><td></td><td></td></tr><tr><td>- Non-related parties</td><td>6,366</td><td>5,972</td><td>-</td><td>-</td></tr><tr><td>Bills receivables</td><td>9,068</td><td>7,379</td><td>-</td><td>-</td></tr><tr><td>Trade and bills receivables</td><td>15,434</td><td>13,351</td><td>-</td><td>-</td></tr><tr><td>Contract work-in-progress</td><td></td><td></td><td></td><td></td></tr><tr><td>- Due from customers (Note 14)</td><td>492</td><td>660</td><td>-</td><td>-</td></tr><tr><td>Advance payment for project costs</td><td>676</td><td>720</td><td>-</td><td>-</td></tr><tr><td>Unbilled contract revenue</td><td>7,492</td><td>4,992</td><td>-</td><td>-</td></tr><tr><td>Other receivables</td><td></td><td></td><td></td><td></td></tr><tr><td>- Subsidiary corporations</td><td>-</td><td>-</td><td>4,205</td><td>5,088</td></tr><tr><td>- Staff advances</td><td>-</td><td>4</td><td>-</td><td>-</td></tr><tr><td>- Non-related parties</td><td>158</td><td>298</td><td>-</td><td>-</td></tr><tr><td>- Value added tax recoverable</td><td>136</td><td>138</td><td>-</td><td>-</td></tr><tr><td>- Withholding tax receivable</td><td>16</td><td>17</td><td>-</td><td>-</td></tr><tr><td>Less: Allowance for impairment of receivables</td><td></td><td></td><td></td><td></td></tr><tr><td> – non-related parties (Note 26(b)(ii))</td><td>-</td><td>(138)</td><td>-</td><td>-</td></tr><tr><td>Other receivables – net</td><td>310</td><td>319</td><td>4,205</td><td>5,088</td></tr><tr><td>Deposits</td><td>429</td><td>290</td><td>-</td><td>-</td></tr><tr><td>Prepayments</td><td>483</td><td>467</td><td>29</td><td>19</td></tr><tr><td></td><td>25,316</td><td>20,799</td><td>4,234</td><td>5,107</td></tr></table>
The amount due from subsidiary corporations are non-trade in nature, unsecured, interest free and repayable on demand
# 13. Inventories
<table><tr><td rowspan="3"></td><td colspan="2">Group</td></tr><tr><td>2015</td><td>2014</td></tr><tr><td> S$’000</td><td>S$’000</td></tr><tr><td>Voice, video and data communication equipment</td><td>395</td><td>432</td></tr></table>
The cost of inventories recognised as an expense and included as part of “Cost of sales – equipment and consumables used” amounts to S\$40,095,000 (2014: S\$32,592,000).
The Group has recognised a write-down of its slow-moving inventories amounting to S\$44,000 (2014: S\$42,000) (Note 5).
# 14. Contract work-in-progress
<table><tr><td rowspan="3"></td><td colspan="2">Group</td></tr><tr><td>2015</td><td>2014</td></tr><tr><td> S$’000</td><td>S$’000</td></tr><tr><td>Contract work-in-progress</td><td></td><td></td></tr><tr><td>Aggregate costs incurred and pro ts recognised (less losses recognised)
to date on uncompleted contracts</td><td>492</td><td>660</td></tr><tr><td>Less: Progress billings</td><td>(45)</td><td>(77)</td></tr><tr><td></td><td>447</td><td>583</td></tr><tr><td>Presented as:</td><td></td><td></td></tr><tr><td>Due from customers on contract work-in-progress (Note 12)</td><td>492</td><td>660</td></tr><tr><td>Due to customers on contract work-in-progress (Note 17)</td><td>(45)</td><td>(77)</td></tr><tr><td></td><td>447</td><td>583</td></tr></table> |
3426917_35.pdf | en | We perform a quarterly evaluation of all of our risk-sharing loans to determine whether a loss is probable. Our process for identifying which risk-sharing loans may be probable of loss consists of an assessment of several qualitative and quantitative factors including payment status, property financial performance, local real estate market conditions, loan-to-value ratio, debt-service-coverage ratio, and property condition. When we believe a loan is probable of foreclosure or in foreclosure, we record an allowance for that loan (a “specific reserve”). The specific reserve is based on the estimate of the property fair value less selling and property preservation costs and considers the loss-sharing requirements detailed below in the “Credit Quality and Allowance for Risk-Sharing Obligations” section. The estimate of property fair value at initial recognition of the allowance for risk-sharing obligations is based on appraisals, broker opinions of value, or net operating income and market capitalization rates, whichever we believe is the best estimate of the net disposition value. The allowance for risk-sharing obligations for such loans is updated as any additional information is received until the loss is settled with Fannie Mae. The settlement with Fannie Mae is based on the actual sales price of the property and selling and property preservation costs and considers the Fannie Mae loss-sharing requirements. Loss settlement with Fannie Mae has historically concluded within 18 to 36 months after foreclosure. Historically, the initial specific reserves have not varied significantly from the final settlement. We are uncertain whether such a trend will continue in the future.
In addition to the specific reserves discussed above, we also record an allowance for risk-sharing obligations related to all risk-sharing loans on our watch list (“general reserves”). Such loans are not probable of foreclosure but are probable of loss as the characteristics of these loans indicate that it is probable that these loans include some losses even though the loss cannot be attributed to a specific loan. For all other risk-sharing loans not on our watch list, we continue to carry a guaranty obligation. We calculate the general reserves based on a migration analysis of the loans on our historical watch lists, adjusted for qualitative factors. When we place a risk-sharing loan on our watch list, we cease to amortize the guaranty obligation and transfer the remaining unamortized balance of the guaranty obligation to the general reserves. If a risk-sharing loan is subsequently removed from our watch list due to improved financial performance, we transfer the unamor-tized balance of the guaranty obligation back to the guaranty obligation classification on the balance sheet and amortize the remaining unamortized balance evenly over the remaining estimated life. For each loan for which we have a risk-sharing obligation, we record one of the following liabilities associated with that loan as discussed above: guaranty obli-gation, general reserve, or specific reserve. Although the liability type may change over the life of the loan, at any particular point in time, only one such liability is associated with a loan for which we have a risk-sharing obligation.
We evaluate all of our loans held for investment for impairment quarterly. Our impairment evaluation focuses pri-marily on payment status and property financial performance. We consider a loan impaired when the current facts and circumstances suggest it is not probable that we will collect all contractually due principal and interest payments. When a loan is not considered impaired, we apply a collective allowance that is based on recent historical loss probability and historical loss rates incurred in our risk-sharing portfolio, adjusted as needed for current market conditions (“loss factors”). We use the loss experience from our risk-sharing portfolio as a proxy for losses incurred in our loans held for investment portfolio since (i) we have not experienced any actual losses related to our loans held for investment to date and (ii) the loans in the loans-held-for-investment portfolio have similar characteristics to loans held in the risk-sharing portfolio. Since the inception of the Interim Program in 2012, we have not had any delinquent or impaired loans or charged off any loans. The historical loss factors are updated quarterly. We have not experienced significant change in the loss factors during the periods presented in the financial statements. These loss factors may change in the future as economic and market conditions change and as the Interim Program matures.
# Overview of Current Business Environment
The fundamentals of the commercial and multifamily real estate market remain strong. Multifamily occupancy rates and effective rents continue to increase based upon strengthening rental market demand while delinquency rates remain at historic lows, all of which aid loan performance due to their importance to the cash flows of the underlying properties. Most other commercial real estate asset classes have experienced similar performance in underlying fundamentals. The positive performance has boosted the value of many commercial and multifamily properties towards the high end of his-torical ranges. |
3426917_36.pdf | en | In addition to the improved property fundamentals, for the last several years, the U.S. commercial and multifamily mortgage market has experienced historically low interest rates, leading many borrowers to seek refinancing prior to the scheduled maturity date of their loans. As borrowers have sought to take advantage of the interest rate environment and improved property fundamentals, the number of lenders and amount of capital available to lend have increased dramati-cally. According to the Mortgage Bankers Association, commercial and multifamily loan maturities are expected to in-crease dramatically through the end of 2017, as the loans originated at the height of the CMBS market begin maturing a decade later. All of these factors have benefited our origination and investment sales volumes over the past several quarters. Competition among commercial real estate services firms, banks, life insurance companies, and the GSEs remains fierce.
During the fourth quarter of 2016, the Federal Reserve raised its targeted Fed Funds Rate by another 25 basis points and suggested that it is likely going to increase its targeted Fed Funds Rate during 2017. We have not experienced a significant decline in origination volume or profitability as a result of the increases as long-term mortgage interest rates generally remained at historically low levels during the majority of 2016. Long-term mortgage interest rates did increase significantly during the last two months of 2016, largely due to the anticipation of a rate increase by the Federal Reserve and the results of the 2016 Presidential Election. However, even the sharp increase in long-term mortgage interest rates did not appear to adversely impact our loan origination volumes. We cannot be certain that trend will continue as the number, timing, and magnitude of any future increases by the Federal Reserve, taken together with previous interest rate increases and combined with other macroeconomic factors, may have a different effect on the commercial real estate market.
Late in the second quarter of 2016, citizens of the United Kingdom (“U.K.”) voted to exit the European Union (“E.U.”), an action commonly referred to as “Brexit.” The referendum itself has not resulted in the U.K.’s immediate exodus from the E.U. since the vote was not legally binding on the British government. Rather, Parliament, having heard the voice of voters, may now enact laws to facilitate the U.K.’s departure and must notify the European Commission of its intention to leave the E.U. Legislation to effect the departure has been passed by the lower house of Parliament. Many observers anticipate that the U.K. will invoke Article 50 of the Lisbon Treaty in the first half of 2017 to leave the E.U. After such notice is provided, the U.K. and European Commission will have a two-year window in which to establish the terms of the U.K.’s departure. Even though the process of separating from the E.U. will take several years, Brexit has created a significant amount of uncertainty in both the global and domestic financial markets as participants have evaluated the impact Brexit may have on the global and domestic economies.
Brexit has had minimal impact on our operations and financial results as we have no direct exposure to the U.K. or E.U. Additionally, we believe the indirect impact of Brexit likely benefitted us during the second half of 2016 as borrowers took advantage of low mortgage interest rates and as a “flight to safety” resulted in an increase of global capital investments in U.S. markets, including commercial real estate, resulting in higher loan origination and investment sales activity. Some of these benefits may be mitigated by higher credit risk spreads demanded by investors in commercial real estate loans going forward. We believe these indirect impacts will largely continue in the near term (although potentially partially or completely mitigated by the aforementioned increase in interest rates due to the actions of the Federal Reserve and the results of the 2016 Presidential Election) but are uncertain about the long-term duration.
We are a market-leading originator with Fannie Mae and Freddie Mac, and the GSEs remain the most significant providers of capital to the multifamily market. The Federal Housing Finance Agency (“FHFA”) 2017 GSE Scorecard (“2017 Scorecard”) established Fannie Mae’s and Freddie Mac’s 2017 loan origination caps at \$36.5 billion each for market-rate apartments (“2017 Caps”), the same as the final 2016 loan origination caps (the 2016 loan origination caps began the year at \$31.0 billion each, but were adjusted by the FHFA twice during 2016 to a final amount of \$36.5 billion each). Affordable housing loans, loans to small multifamily properties, and manufactured housing rental community loans continue to be excluded from the 2017 Caps. Additionally, the definition of the affordable loan exclusion continues to encompass affordable housing in high- and very-high cost markets and to allow for an exclusion from the 2017 Caps for the pro-rata portion of any loan on a multifamily property that includes affordable units. The 2017 Scorecard provides the FHFA the flexibility to review the estimated size of the multifamily loan origination market on a quarterly basis and proactively adjust the 2017 Caps upward should the market be larger than expected in 2017 (as noted above, the FHFA adjusted the caps upward twice in 2016). The 2017 Scorecard also provides exclusions for loans to properties located in |
20780351_362.pdf | en | # Section 6.11 Attorney’s Fees.
In the event any claim, action, suit, proceeding, arbitration, complaint, charge or investigation is brought in respect of this Agreement or any of the documents referred to in this Agreement, the prevailing party will be entitled to recover reasonable attorneys' fees and other costs incurred in such Proceeding, in addition to any relief to which such party may be entitled.
# Section 6.12 No Waiver.
Neither any failure nor any delay by any party in exercising any right, power, or privilege under this Agreement or any of the documents referred to in this Agreement will operate as a waiver of such right, power, or privilege, and no single or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege. To the maximum extent permitted by applicable laws, (a) no claim or right arising out of this Agreement or any of the documents referred to in this Agreement can be waived by a Party, in whole or in part, unless made in a writing signed by such Party; (b) a waiver given by a Party will only be applicable to the specific instance for which it is given; and (c) no notice to or demand on a Party will (i) waive or otherwise affect any obligation of that Party or (ii) affect the right of the Party giving such notice or demand to take further action without notice or demand as provided in this Agreement.
# Section 6.13 Notices.
All notices and other communications required or permitted by this Agreement shall be in writing and will be effective, and any applicable time period shall commence, when (a) delivered to the following address by hand or by a nationally recognized overnight courier service (costs prepaid) addressed to the following address or (b) transmitted electronically to the following facsimile numbers or e-mail addresses, in each case marked to the attention of the Person (by name or title) designated below (or to such other address, facsimile number, e-mail address, or Person as a Party may designate by notice to the other parties):
# Bitauto
New Century Hotel Office Tower 6/F
No. 6 South Capital Stadium Road
Beijing, 100044
The People’s Republic of China
Attention: Cynthia He
Facsimile: (86 10) 6849-2200
# Tencent
c/o Tencent Holdings Limited
29/F., Three Pacific Place, No. 1 Queen’s Road East, Wanchai, Hong Kong
Attention: Compliance and Transactions Department
E-mail: [email protected] |
20780351_363.pdf | en | # JD
JD.com, Inc.
21/F, Building A, No.18 Kechuang 11th Street, Yizhuang Economic and Technological Development Zone, Daxing District, Beijing 101111, PRC
Attention: Legal Department (Mergers and Acquisitions Group)
Email: [email protected]
Section 6.14 Severability.
If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.
Section 6.15 Time of Essence.
With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence.
Section 6.16 Counterparts and Electronic Signatures.
(a) This Agreement and other documents to be delivered pursuant to this Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy and all of which, when taken together, will be deemed to constitute one and the same agreement or document, and will be effective when counterparts have been signed by each of the parties and delivered to the other parties.
(b) A manual signature on this Agreement or other documents to be delivered pursuant to this Agreement, an image of which shall have been transmitted electronically, will constitute an original signature for all purposes. The delivery of copies of this Agreement or other documents to be delivered pursuant to this Agreement, including executed signature pages where required, by electronic transmission will constitute effective delivery of this Agreement or such other document for all purposes.
[Remainder of page intentionally left blank.] |
20753823_86.pdf | en | \[ \begin{array} { l l } { { \overline { { { f } } } ( t _ { n } ) = \left\langle \int f ( x + \Delta x ) P _ { n - 1 } ( x ) d ^ { D } x \right\rangle _ { \mathrm { N s } } } } \\ { { \qquad = \left\langle \int \left( f ( x ) + f _ { \ast } ( x ) \Delta x ^ { i } + ( 1 / 2 ) f _ { \ast j } ( x ) \Delta x ^ { i } \Delta x ^ { j } + . . . \right) P _ { n - 1 } ( x ) d ^ { D } x \right\rangle _ { \mathrm { N s } } } } \\ { { \qquad = \displaystyle \int f ( x ) \left\langle \hat { 1 } - \frac { \partial } { \partial x ^ { i } } \Delta x ^ { i } + ( 1 / 2 ) \frac { \partial ^ { 2 } } { \partial x ^ { i } \partial x ^ { j } } \Delta x ^ { i } \Delta x ^ { j } + . . . \right\rangle _ { \mathrm { N s } } P _ { n - 1 } ( x ) d ^ { D } x . } } & { { \mathrm { ( A 8 ) } } } \end{array} \]
Here, \( f _ { / j } \, \equiv \, \partial f / \partial x ^ { i } \) and similar for \( f _ { { ' } i j } \, = \, \partial ^ { 2 } f / \partial x ^ { i } \partial x ^ { j } \), and the partial integration has been used.
The next step is to Taylor expand \( \Delta x \) up to second order in \( \Delta t \) and substitute this expansion into the above expression. Using Equation (A1), one has
\[ \Delta x ^ { i } = \mathcal { F } _ { n } ^ { i } \Delta t + \alpha ( \mathcal { F } _ { n } ^ { i } ) , \mathcal { F } _ { n } ^ { j } \Delta t ^ { 2 } + \ldots \eqno ( \mathrm { A 9 } ) \]
Substituting this expression into Equation (A8), using Equation (A2), and performing the stochastic averaging over \( \xi _ { n } \) with the help of Equation (7), one arrives at
\[ \overline { { f } } ( t _ { n } ) = \int f ( x ) ( \widehat { 1 } - \Delta t \hat { H } _ { \alpha } ^ { ( D ) } + \ldots ) P _ { n - 1 } ( x ) d ^ { D } x , \eqno ( \mathrm { A 1 0 } ) \]
with the FP operator being
\[ \hat { H } _ { \alpha } ^ { ( D ) } = - \frac { \partial } { \partial x ^ { i } } F _ { \alpha } ^ { i } ( x ) - \Theta \frac { \partial } { \partial x ^ { i } } e _ { a } ^ { i } ( x ) \frac { \partial } { \partial x ^ { j } } e _ { a } ^ { j } ( x ) \eqno ( \mathrm { A 1 1 } ) \]
and with the \( \alpha \)-dependent flow vector field from Equation (91).
In the above derivation of the FP operator, SdE (A9) was used as a formal equation defining \( \Delta x \). One can take an alternative view on stochastic dynamics in which the dynamics is continuous in time and the noise is piece-wise constant, as given in Figure 1. For a fixed noise configuration, one has a continuous trajectory x(t), defined by \( \dot { x } \, = \, \mathcal { F } _ { n } ( x ( t ) ) \) with the initial condition \( x ( t _ { n - 1 } ) = x _ { n _ { 1 } } \). Now, there is no freedom in choosing \( \alpha \) because \( \Delta x \) is uniquely defined by the evolution according to the Picard-Lindelo¨f theorem. In particular, \( \Delta x \) has a unique Taylor expansion in \( \Delta t \):
\[ \Delta x ^ { i } = \left. \frac { \partial x ^ { i } } { \partial t } \right| _ { \Delta t = 0 } \Delta t + \frac { 1 } { 2 } \left. \frac { \partial ^ { 2 } x ^ { i } } { \partial ^ { 2 } t } \right| _ { \Delta t = 0 } \Delta t ^ { 2 } + . . . \eqno ( \mathrm { A 1 2 } ) \]
The first coefficient here is determined from the SDE itself, |
20753823_87.pdf | en | \[ \left. \frac { \partial x ^ { i } } { \partial t } \right| _ { \Lambda t = 0 } = \mathcal { F } _ { n } ^ { i } ( x ) , \eqno { ( \mathrm { A 1 3 } ) } \]
whereas the second coefficient is obtained via one differentiation of the SDE over time
\[ \left. \frac { \partial ^ { 2 } x ^ { i } } { \partial ^ { 2 } t } \right| _ { \Delta t = 0 } = \left. \frac { \partial \mathcal { F } _ { n } ^ { i } ( x ) } { \partial t } \right| _ { \Delta t = 0 } = \mathcal { F } _ { n ^ { \prime } j } ^ { i } ( x ) \left. \frac { \partial x ^ { i } } { \partial t } \right| _ { \Delta t = 0 } = \mathcal { F } _ { n ^ { \prime } j } ^ { i } ( x ) \mathcal { F } _ { n } ^ { j } ( x ) ; \eqno { ( \mathrm { A 1 4 } ) } \]
thus, the quantity in Equation (A12) becomes
\[ \Delta x ^ { i } = \mathcal { F } _ { n } ^ { i } ( x ) \Delta t + \frac { 1 } { 2 } \mathcal { F } _ { n ^ { \prime } j } ^ { i } ( x ) \mathcal { F } _ { n } ^ { j } ( x ) \Delta t ^ { 2 } + \ldots \eqno ( \mathrm { A 1 5 } ) \]
Comparing this equation with Equation (A9), one concludes that the Stratonovich choice of \( \alpha = 1 / \tau \) 2 must always be used for the continuous-time picture of temporal evolution.
Concerning the Ito interpretation of SDEs, it is often said that, unlike all other interpre-tations, the Ito approach respects the Markovian property in the sense that the increment \( \Delta x _ { n } \) or, equivalently, the final point \( x _ { n } \, = \, x _ { n - 1 } + \Delta x _ { n } \) is a function of only \( x _ { n - 1 } \) and not of \( x _ { n } \). This advantage of Ito SDEs, however, is a misinterpretation. Indeed, the very state-ment that \( x _ { n } \) is a function of itself for \( \alpha \) 0 does not make sense from the point of view of functional dependence. This sentence only tells us that \( x _ { n } \) as a function of \( x _ { n - 1 } \) is given only implicitly by Equation (90). For a fixed noise variable \( \xi _ { n } \), the final point \( x _ { n } \) together with the increment \( \Delta x _ { n } \) is always a function of \( x _ { n - 1 } \) only. Its explicit expression is given by Equation (A9) up to second order in \( \Delta t \), the only accuracy relevant in the continuous-time limit.
Furthermore, the Markovian property of stochastic processes is concerned not with the trajectories (the variables \( x _ { n } \) and \( x _ { n - 1 } \)) but rather with the temporal evolution of TPDs. In application to the SdEs (90), the Markovian property means that the TPD at time moment \( t _ { n } \) depends on the TPD at the previous time moment \( t _ { n - 1 } \) only and not on the TPD at earlier time moments. As clearly observed from Equation (A6), which is correct for all \( \alpha \), all the interpretations of SDEs satisfy this requirement of Markovianity. In other words, Ito SDEs are just as Markovian as SDEs in all the other interpretations.
In other words, the only advantage of the Ito interpretation is the relative ease of its numerical implementation because the increment as a function of \( x _ { n - 1 } \) is given explicitly by the Ito SdE. This convenience for numerical implementations, however, does not have any significance from the mathematical point of view. |
20782229_35.pdf | en | # DIRECTORS
The Directors of the Company during the year ended 31 December 2018 and up to the date of this report were:
# Executive Directors:
Mr. Xu Songqing (Chairman)
Mr. Luo Canwen (Chief Executive Officer)
Mr. Chen Chunniu
Mr. Xu Songman
# Non-executive Director:
Mr. Xu Jianhong
# Independent non-executive Directors:
Mr. Goh Choo Hwee
Mr. Tam Yuk Sang Sammy
Mr. Wu Chi Keung
Pursuant to Article 84 of the Articles of Association of the Company, Mr. Luo Canwen, Mr. Chen Chunniu and Mr. Wu Chi Keung shall retire by rotation and, being eligible, will offer themselves for re-election at the forthcoming annual general meeting.
# BIOGRAPHIES OF DIRECTORS AND SENIOR MANAGEMENT
Biographical details of the Directors and senior management of the Group are set out on pages 9 to 11 of this annual report.
# DIRECTORS’ EMOLUMENTS
Details of the Directors’ emoluments are set out in note 11 to the consolidated financial statements.
No Director has waiver or has agreed to waive any emoluments and no emoluments were paid by the Group to the Directors as an inducement to join or upon joining the Group or as compensation for loss of office during the year ended 31 December 2018.
# DIRECTORS’ SERVICE CONTRACTS
Each of the executive Directors has entered into a service contract with the Company for an initial fixed term of three years with effect from the Listing Date renewable automatically unless terminated by not less than three months’ notice in writing served by either the Director or the Company.
The non-executive Director has entered into a letter of appointment with the Company for an initial term of three years renewable automatically which unless otherwise terminated pursuant to the terms of the appointment is subject to automatic renewal. The appointment shall be subject to normal retirement and re-election at the annual general meeting by Shareholders of the Company pursuant to the Articles of Association. |
20782229_36.pdf | en | Each of the independent non-executive Directors has entered into a letter of appointment with the Company with effect from the Listing Date subject to retirement by rotation and re-election at annual general meetings of our Company and until terminated by not less than three months’ notice in writing served by either the Company or the relevant Director.
Apart from the foregoing, no Director proposed for re-election at the forthcoming annual general meeting has a service contract which is not determinable by the Company or any of its subsidiaries within one year without payment of compensation, other than statutory compensation.
# CONFIRMATION FROM THE INDEPENDENT NON-EXECUTIVE DIRECTORS
The Company has received from each of the independent non-executive Directors the confirmation of their independence pursuant to rule 3.13 of the Listing Rules. Based on such confirmations, the Company considers each of the independent non-executive Directors is independent in accordance with rule 3.13 of the Listing Rules.
# EQUITY-LINKED AGREEMENTS
During the year ended 31 December 2018, the Group did not entered into any equity-linked agreement.
# SHARE OPTION SCHEME
Prior to the Listing, the Company conditionally adopted a share option scheme (the “Scheme”) on 23 March 2016 which became effective and unconditional upon the Listing. The purpose of the Scheme is to enable the Company to grant options to the Eligible Persons (as defined below) as incentives or rewards for their contribution or potential contribution to the Group.
Details of the Scheme are as follows:
# a. Purpose
The primary purpose of the Scheme is to grant options as incentives or rewards to Eligible Persons for their contribution or potential contribution to the Group.
# b. Eligible Persons
The Board may, at its discretion, offer to grant an option to subscribe for such number of new Shares as the Board may determine at an exercise price determined in accordance with paragraph (h) below to any full-time or part-time employee of the Company or any member of the Group, including any executive Director, non-executive Director and independent non-executive Director, and any supplier, customer, agent, advisor and consultant of our Group who, in the sole opinion of the Board, will contribute or have contributed to the Group (collectively, the “Eligible Persons”).
# c. Total number of Shares available for issue
The total number of Shares which may be issued upon exercise of all options to be granted under the Scheme and any other share option schemes of the Company must not exceed 60,000,000 Shares, representing 10% of the Company’s issued share capital upon Listing. |
7587988_106.pdf | en | # 31. Notes to the Consolidated Statement of Cash Flows (continued)
# (C) TOTAL CASH OUTFLOW FOR LEASES
The total cash outflow for leases included in the statement of cash flows is as follows:
<table><tr><td rowspan="2"></td><td>2020</td><td>2019</td></tr><tr><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Within operating activities</td><td>17,353</td><td>15,713</td></tr><tr><td>Within financing activities</td><td>243,148</td><td>339,622</td></tr><tr><td></td><td>260,501</td><td>355,335</td></tr></table>
# 32. Contingent Liabilities
At the end of the reporting period, contingent liabilities not provided for in the financial statements were as follows:
<table><tr><td rowspan="2"></td><td>2020</td><td>2019</td></tr><tr><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Bank guarantees given in lieu of utility and property rental deposits</td><td>24,757</td><td>26,921</td></tr></table>
# 33. Commitments
The Group had the following capital commitments at the end of the reporting period:
<table><tr><td rowspan="2"></td><td>2020</td><td>2019</td></tr><tr><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Contracted, but not provided for:</td><td></td><td></td></tr><tr><td>Leasehold improvements, furniture, fixtures and equipment</td><td>17,550</td><td>30,010</td></tr></table> |
7587988_107.pdf | en | # 34. Related Party Transactions
# (A) In addition to the transactions and balances detailed elsewhere in these financial statements, the Group had the following transactions with related parties during the year:
<table><tr><td rowspan="2"></td><td rowspan="2">Notes</td><td>2020</td><td>2019</td></tr><tr><td>HK$’000</td><td>HK$’000</td></tr><tr><td>Rental expense to a related party</td><td> (i)</td><td>–</td><td>36</td></tr><tr><td>Management fee from associates</td><td> (ii)</td><td>–</td><td>660</td></tr><tr><td>Sales of food and other operating items to associates</td><td> (iii)</td><td>–</td><td>4,620</td></tr></table>
Notes:
(i) The rental expense to a related party, Madam Chan Sai Ying, who is the spouse of Mr. Chung Wai Ping, was charged based on mutually agreed terms at a monthly fixed amount of HK\$4,000 during the year ended 31 December 2019.
(ii) The management fee was charged to associates based on 1 to 2% of gross receipt during the year ended 31 December 2019.
(iii) Sales of food and other operating items to associates were charged based on mutually agreed terms and conditions.
# (B) Compensation of key management personnel of the Group
The compensation of key management personnel of the Group for each reporting period represented the directors’ emoluments as disclosed in note 8 to the financial statements.
The related party transaction mentioned in note (a)(i) above constitutes a continuing connected transaction as defined in Chapter 14A of the Listing Rules. |
11705258_313.pdf | en | option (whether legally enforceable or not) to subscribe for or purchase, or to nominate persons to subscribe for or purchase, any Shares or any securities of any member of the Group.
Following the completion of the Global Offering, the Hong Kong Underwriters and their affiliated companies may hold a certain portion of the Shares as a result of fulfilling their respective obligations under the Hong Kong Underwriting Agreement.
# International Offering
# International Underwriting Agreement
In connection with the International Offering, the Company and the Controlling Shareholders expect to enter into the International Underwriting Agreement with the International Underwriters on the Price Determination Date. Under the International Underwriting Agreement and subject to the Over-allotment Option, the International Underwriters would, subject to certain conditions set out therein, agree severally but notj ointly to procure subscribers for, or themselves to subscribe for, their respective applicable proportions of the International Offer Shares initially being offered pursuant to the International Offering. It is expected that the International Underwriting Agreement may be terminated on similar grounds as the Hong Kong Underwriting Agreement. Potential investors should note that in the event that the International Underwriting Agreement is not entered into, the Global Offering will not proceed. Please see “Structure of the Global Offering—The International Offering.”
# Over-allotment Option
The Company is expected to grant to the International Underwriters the Over-allotment Option, exercisable by the Joint Global Coordinators on behalf of the International Underwriters at any time from the Listing Date until 30 days after the last day for lodging applications under the Hong Kong Public Offering, pursuant to which the Company may be required to issue up to an aggregate of 53,000,000 Shares, representing not more than 15% of the number of Offer Shares initially available under the Global Offering, at the Offer Price, to, among other things, cover over-allocations in the International Offering, if any. Please see “Structure of the Global Offering—Over-allotment Option.”
# Indemnity
Each of our Company and the Controlling Shareholders has agreed to indemnify the Hong Kong Underwriters and International Underwriters for certain losses which they may suffer or incur, including losses arising from their performance of their obligations under the Underwriting Agreements and any breach by any of the Company and the Controlling Shareholders of the Hong Kong Underwriting Agreements.
# Total Commissions and Expenses
The Underwriters will receive an underwriting commission of 2.5% of the aggregate Offer Price of all the Offer Shares (including any Offer Shares to be issued pursuant to the exercise of the Over-allotment Option), out of which they will pay any sub-underwriting commissions and other fees.
The Underwriters may receive a discretionary incentive fee of up to 1.0% of the aggregate Offer Price of all the Offer Shares (including any Offer Shares to be issued pursuant to the exercise of the Over-allotment Option). |
11705258_314.pdf | en | For any unsubscribed Hong Kong Offer Shares reallocated to the International Offering, the underwriting commission will not be paid to the Hong Kong Underwriters but will instead be paid, at the rate applicable to the International Offering, to the relevant International Underwriters.
The aggregate underwriting commissions payable to the Underwriters in relation to the Global Offering (assuming an Offer Price of HK\$2.39 per Offer Share (which is the mid-point of the Offer Price range), the full payment of the discretionary incentive fee and the exercise of the Over-allotment Option in full) will be approximately HK\$34.0 million.
The aggregate underwriting commissions and fees together with the Stock Exchange listing fees, the SFC transaction levy and the Stock Exchange trading fee, legal and other professional fees and printing and all other expenses relating to the Global Offering are estimated to be approximately HK\$91.6 million (assuming an Offer Price of HK\$2.39 per Offer Share (which is the mid-point of the Offer Price range), the full payment of the discretionary incentive fee and the exercise of the Over-allotment Option in full) and will be paid by our Company.
# Indemnity
Each of our Company and the Controlling Shareholders has agreed to indemnify the Hong Kong Underwriters and International Underwriters for certain losses which they may suffer or incur, including losses arising from their performance of their obligations under the Underwriting Agreements and any breach by any of the Company and the Controlling Shareholders of the Hong Kong Underwriting Agreements.
# Hong Kong Underwriters’ Interests in our Company
Save as disclosed in this prospectus and save for its obligations under the Hong Kong Underwriting Agreement, the Hong Kong Underwriters do not have any shareholding interests in our Company or the right or option (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in our Company.
Following the completion of the Global Offering, the Underwriters and their affiliated companies may hold a certain portion of the Shares as a result of fulfilling their obligations under the Underwriting Agreements.
# Other Services to our Company
The Joint Global Coordinators and the Underwriters or its respective affiliates have, from time to time, provided and expect to provide in the future investment banking and other services to our Company and our respective affiliates, for which such Joint Global Coordinators and the Underwriters or their respective affiliates have received or will receive customary fees and commissions
# Sponsors’ Independence
The Joint Sponsors satisfy the independence criteria applicable to sponsors set out in Rule 3A.07 of the Listing Rules.
# ACTIVITIES BY SYNDICATE MEMBERS
The underwriters of the Hong Kong Public Offering and the International Offering (together, the “Syndicate Members”) and their affiliates may each individually undertake a variety of activities (as further described below) which do not form part of the underwriting or stabilizing process. |
11767810_8.pdf | en | Using [5, Proposition 6.6], if \( \sigma _ { x } \) can be obtained as a truncated induction (see [9, Chapter 11])from the sign representation of a Weyl subgroup \( W ^ { \prime } \leq W \), i.e. \( \sigma _ { x } = j _ { W ^ { \prime } } ^ { W } ( \mathrm { s g n } ) \), then we can reduce this formula into
\[ R _ { x } : = \sum _ { w ^ { \prime } \in W ^ { \prime } } ( - 1 ) ^ { l ( w ^ { \prime } ) } X \left( \begin{array} { c } { { \lambda _ { \mathcal { O } } } } \\ { { w ^ { \prime } \lambda _ { \mathcal { O } } } } \end{array} \right) . \]
Step (4) Consequently, every unipotent representation corresponding to \( \mathcal { O } \) is parametrized by \( \pi \in \overline { { A } } ( \mathcal { O } ) ^ { \wedge } \), and has the character formula
\[ X _ { \pi } : = \frac { 1 } { | \overline { { A } } ( \mathcal { O } ) | } \sum _ { x \in \overline { { A } } ( \mathcal { O } ) } t r ( \pi ( x ) ) R _ { x } . \]
Example 3.2. We now study the special unipotent representations attached to the orbit \( \mathcal { O } = ( 2 ^ { 2 p } 1 ^ { 2 q } ) \):
– The Lusztig-Spaltenstein dual is given by \( { \cal L } { \cal O } = ( 2 p + 2 q + 1 , 2 p - 1 , 1 ) \). Hence
\[ \lambda \mathcal { O } = \frac { 1 } { 2 } \, ^ { L } h = ( p + q , p + q - 1 , \dots , p , ( p - 1 ) ^ { 2 } , \dots , 2 ^ { 2 } , 1 ^ { 2 } , 0 ) . \]
– In [20], Lusztig defined an injection
\[ \gamma ( \mathcal { O } ) : = \{ \mathcal { O } ^ { \prime } \subseteq \overline { { \mathcal { O } } } | \mathcal { O } ^ { \prime } \not \subseteq \overline { { \mathcal { O } } } _ { s p e c } \mathrm { ~ f o r ~ a n y ~ o t h e r ~ s p e c i a l ~ o r b i t ~ } \mathcal { O } _ { s p e c } \subseteq \mathcal { O } \} \hookrightarrow \overline { { A } } ( \mathcal { O } ) . \]
Consider the following composition of maps:
\[ \mathcal { O } ^ { \prime } \in \gamma ( \mathcal { O } ) \hookrightarrow x ( \mathcal { O } ^ { \prime } ) \in \overline { { A } } ( \mathcal { O } ) \overset { S t e p ( 2 ) } { \longmapsto } \sigma _ { x ( \mathcal { O } ^ { \prime } ) } \in \hat { W } . \]
Then \( \sigma _ { x ( \mathcal { O } ^ { \prime } ) } = s p ( \mathcal { O } ^ { \prime } ) \), the Springer representation of \( \mathcal { O } ^ { \prime } \).
For \( \mathcal { O } = ( 2 ^ { 2 p } 1 ^ { 2 q } ) \), \( \gamma ( O ) = \{ O , { \mathcal { O } } ^ { \prime } \} \), where \( \mathcal { O } ^ { \prime } = ( 2 ^ { 2 p - 1 } 1 ^ { 2 q + 2 } ) \), and \( A ( \mathcal { O } ) = \overline { { A } } ( \mathcal { O } ) = \mathbb { Z } / 2 \mathbb { Z } = \)\( \{ e , s \} \) with e being the identity element. So the injection above is indeed a bijection, and
\[ \mathcal { O } \leftrightarrow e \; ; \; \; \mathcal { O } ^ { \prime } \leftrightarrow s . \]
According to the algorithm of computing Springer representations given in Section 7 of[24],
\[ \sigma _ { e } = ( 1 ^ { p } , 1 ^ { p + q } ) = j _ { D _ { p } \times C _ { p + q } } ^ { C _ { n } } ( \mathrm { s g n } ) , \; \; \sigma _ { s } = ( 1 ^ { p + q + 1 } , 1 ^ { p - 1 } ) = j _ { D _ { p + q + 1 } \times C _ { p - 1 } } ^ { C _ { n } } ( \mathrm { s g n } ) . \]
– The two reduced formula is of the form
\[ ( 3 ) \qquad \quad R _ { e } = \sum _ { w \in W ( D _ { p } \times C _ { p + q } ) } ( - 1 ) ^ { l ( w ) } X \left( \begin{array} { c c c } { { p - 1 , \ldots , 1 , 0 ; } } & { { p + q , \ldots , 2 , 1 } } \\ { { w ( } } & { { p - 1 , \ldots , 1 , 0 ; } } & { { p + q , \ldots , 2 , 1 ) } } \end{array} \right) , \]
\[ ( 4 ) \qquad R _ { s } = \sum _ { w ^ { \prime } \in W ( D _ { p + q + 1 } \times C _ { p - 1 } ) } ( - 1 ) ^ { l ( w ^ { \prime } ) } X \left( \begin{array} { c } { { p + q , \dots , 1 , 0 ; } } \\ { { w ^ { \prime } ( } & { { p + q , \dots , 1 , 0 ; } } \end{array} \begin{array} { c } { { p - 1 , \dots , 2 , 1 } } \\ { { p - 1 , \dots , 2 , 1 } } \end{array} \right) . \]
(Here we have used Remark (a) after Proposition 1.4.) |
11767810_9.pdf | en | – The two special unipotent representations are of the form
\[ X _ { \mathcal { O } } ^ { + } = \frac { 1 } { 2 } ( R _ { e } + R _ { s } ) , ~ X _ { \mathcal { O } } ^ { - } = \frac { 1 } { 2 } ( R _ { e } - R _ { s } ) . \]
We now link the special unipotent representations obtained in the previous example with \( \theta ( \mathrm { t r i v } ) \),\( \theta ( \mathrm { d e t } ) \).
Proposition 3.3. As \( ( { \mathfrak { g } } _ { \mathbb { C } } , K _ { \mathbb { C } } ) \cdot \)-modules,
\[ X _ { \mathcal { O } } ^ { + } \cong \theta ( \mathrm { t r i v } ) , ~ X _ { \mathcal { O } } ^ { - } \cong \theta ( \mathrm { d e t } ) \]
Proof. The proposition can be proved directly by tracing along the lines of Corollary 5.24 in [5] and Theorem 2.1. We present another proof here. Note that the infinitesimal charac-ter of \( X _ { \mathcal { O } } ^ { + } \) and \( X _ { \mathcal { O } } ^ { - } \) are both \( W \times W \)-conjugacy class of) \( ( \lambda _ { \mathcal { O } } , \lambda _ { \mathcal { O } } ) \). By Proposition 1.4, they must be of the form \( L \left( \begin{array} { c } { { \dot { \lambda _ { \mathcal { O } } } } } \\ { { w \lambda _ { \mathcal { O } } } } \end{array} \right) \) for some \( w \in W \). For \( X _ { \mathcal { O } } ^ { + } \),
\[ X _ { \mathcal { O } } ^ { + } \cong \frac { 1 } { 2 } ( R _ { e } + R _ { s } ) = \frac { 1 } { 2 } [ ( X \left( \begin{array} { l } { \lambda _ { \mathcal { O } } } \\ { \lambda _ { \mathcal { O } } } \end{array} \right) + \ldots ) + ( X \left( \begin{array} { l } { \lambda _ { \mathcal { O } } } \\ { \lambda _ { \mathcal { O } } } \end{array} \right) + \ldots ) ] = X \left( \begin{array} { l } { \lambda _ { \mathcal { O } } } \\ { \lambda _ { \mathcal { O } } } \end{array} \right) + \ldots , \]
where the remaining terms are of the form \( X \left( \begin{array} { c } { { \lambda \mathcal { O } } } \\ { { w \lambda \mathcal { O } } } \end{array} \right) \! . \), \( l ( w ) > \) 0. Hence its lowest \( K _ { \mathbb { C } } \)-type is \( \lambda _ { \mathcal { O } } - \lambda _ { \mathcal { O } } = ( 0 ^ { n } ) \). On the other hand, the only \( L \left( \begin{array} { c } { { \lambda \mathcal { O } } } \\ { { w \lambda \mathcal { O } } } \end{array} \right) \) having lowest \( K _ { \mathbb { C } } \)-type \( ( 0 ^ { n } ) \) is \( L \left( \begin{array} { c } { { \lambda _ { \mathcal { O } } } } \\ { { \lambda _ { \mathcal { O } } } } \end{array} \right) . \) By (Remark (b) after) Proposition 1.4 and Theorem 2.1,
\[ \begin{array} { r } { X _ { \mathcal { O } } ^ { + } \cong L \left( \begin{array} { l } { \lambda _ { \mathcal { O } } } \\ { \lambda _ { \mathcal { O } } } \end{array} \right) \cong L \left( \begin{array} { l l l } { p + q , \dots , 2 , 1 ; } & { p - 1 , \dots , 1 , 0 } \\ { p + q , \dots , 2 , 1 ; } & { p - 1 , \dots , 1 , 0 } \end{array} \right) \cong \theta ( \mathrm { t r i v } ) . } \end{array} \]
For \( X _ { \mathcal { O } } ^ { - } \), a direct computation shows that the term
\[ X \left( \begin{array} { c } { { \lambda _ { \mathcal { O } } } } \\ { { w _ { p } \lambda _ { \mathcal { O } } } } \end{array} \right) : = X \left( \begin{array} { c c c c c c } { { p + q , \ldots , p + 1 ; } } & { { p , p - 1 } } & { { p - 1 , p - 2 } } & { { \ldots , } } & { { 2 , 1 , } } & { { 1 , 0 } } \\ { { p + q , \ldots , p + 1 ; } } & { { p - 1 , p } } & { { p - 2 , p - 1 } } & { { \ldots , } } & { { 1 , 2 , } } & { { 0 , 1 } } \end{array} \right) \, . \]
appears in the expression \( \begin{array} { r } { X _ { \mathcal { O } } ^ { - } \cong \frac { 1 } { 2 } ( R _ { e } - R _ { s } ) } \end{array} \) with coefficient 1. Hence \( X _ { \mathcal { O } } ^ { - } \) must have lowest \( K _ { \mathbb { C } } \)-type smaller than or equal to \( ( 1 ^ { 2 p } 0 ^ { q } ) \sim ( \lambda _ { \mathcal { O } } \! - \! w _ { p } \lambda _ { \mathcal { O } } ) \), that is, the lowest \( K _ { \mathbb { C } } \)-type must be of the form \( ( 1 ^ { 2 i } 0 ^ { n - 2 i } ) \) with \( i \leq p \). However, another direct computation shows that all terms of the form
\[ \{ X \left( \begin{array} { c } { { \lambda \mathcal O } } \\ { { w \lambda \mathcal O } } \end{array} \right) | w \in W , \; ( \lambda \mathcal O - w \lambda \mathcal O ) \sim ( 1 ^ { 2 i } 0 ^ { n - 2 i } ) , \; i < p \} \]
do not appear in the expression of \( X _ { \mathcal { O } } ^ { - } \). Therefore, the lowest \( K _ { \mathbb { C } } \)-type of \( X _ { \mathcal { O } } ^ { - } \) must be \( \left( 1 ^ { 2 p } 0 ^ { q } \right) \).
Suppose \( X _ { \mathcal { O } } ^ { - } \cong L \left( \begin{array} { c } { \lambda \mathcal { O } } \\ { w \lambda \mathcal { O } } \end{array} \right) \) for some \( w \in W \), then we have |
11689997_34.pdf | en | Libertatem would suggest: The UK adopts the MIFID II definitions which make Independent” advisers. Fee based, whole of market and Independent of undue influence via ownership or other agreement. This would allow most restricted advisers to re-join the Independent camp
Under MIFID II: Non-Independent advisers can receive commission, use panels of providers etc. As long as this is properly disclosed we feel that this may well provide access to advice for some of those who were disenfranchised by RDR. It may make sense to remove the term “Restricted” and use the term “Regulated”.
Adopting MIFID II definitions would both realign the UK with Europe but also use terms which are more easily understood
That all the stakeholders agree a set of definitions for advice and guidance which are used by all to improve communication and avoid many of the current misunderstandings.
Q3: What comments do you have on consumer demand for professional financial advice?
Thanks to THR2: We know that the historical market for Independent Advice was 16m. We also know that advisers could be split into three specific groups.
THR2 Identified the numbers of clients under each definition
Boutique advisers enjoy a per adviser range between 10 and 120 although the current average is 159. This is likely to drop significantly.
Segregated Adviser will be the way forward for the adviser who wants more than a lifestyle business as it can offer a capital exit in the future. The current per adviser average is 191
Generalist/Transactional advisers currently show 205 active clients per adviser. But they also have another 400+ old clients who may return.
Most of the 3,250 who have exited the sector since 2010 have been Generalist adviser and some had client banks in excess of 1,000 clients
Libertatem suggests: At least 4m consumers seem to have successfully made the RDR transaction to fees. Circa 2,500 – mostly attached to generalist advisers - may be less secure particularly if we continue to see Trail Commission being reneged on by providers.
If we are to see a reconnection between advice and the 10m ex IFA clients, we will need to recreate the new version of the commission based market (See National Advice Service) |
11689997_35.pdf | en | # Q.4: Do you have any comments or evidence on the level of demand for advice from sources other than professional financial advisers?
There is no shortage of PR noise from a number of investment platforms that seek to deal directly with the client. But currently there is little evidence that this noise is converting into profitable business. Such firms will have resolved the matter in the next 3 years. Either they will have reached the tipping point into profit or their investors will have given up.
The missing link of many non-advised options is “the Challenge”.
This is the first step to a client making private provision and the most important aspect of an adviser’s day. The challenge comes twice in any client relationship. Firstly, when a client is challenged to seek advice and secondly when the client is challenged to accept the solutions are suggested.
This challenge can only be done by human interaction. We do not see it being done by computers, Robo Advice or other androids. It is possible via Skype but better achieved face to face. Much of the enthusiasm for new processes presumes that clients will challenge themselves – this is unlikely and unproven.
The price of RDR’s commission free world is the removal of that challenge from the common man and with it any independence from the state when in need.
# Q5: Do you have any comments or evidence on the types of financial needs for which consumers may seek advice?
RDR has sought to push the adviser community towards the Boutique model. It presumed that all clients wanted an intimate relationship with their advisers in which there were regular reviews. In essence that the IFA sector should be restricted to financial planning.
The reality was that the vast majority of clients were transactional and wanted a once off or a once in a while advisory event or the solution of a specific issue. They did not seek regular connection. At the same time RDR sought to make all advisory firms the same and restrict their activities and the accessibility of advice
Post RDR - adviser firms had all the same qualifications and were trading in the same market using the same basic business model. So now advisers have difficulty distinguishing themselves from the competition.
Q6: Is the FCA Consumer Spotlight segmentation model useful for exploring consumers’ advice needs?
No appears to be a complete waste of money unless you are a regulator seeking to increase your empire
# Q7: Do you have any observation on the segments and whether any should be the subject of particular focus in the Review?
No |
20739465_83.pdf | en | # 27. FAIR VALUE OF ASSETS AND LIABILITIES
# (a) Fair value hierarchy
The Group categorises fair value measurements using a fair value hierarchy that is dependent on the valuation inputs used as follows:
<table><tr><td>– Level 1</td><td>– Quoted prices (unadjusted) in active market for identical assets or liabilities that the Group
can access at the measurement date,</td></tr><tr><td>– Level 2</td><td>– Inputs other that quoted prices included within Level 1 that are observable for the asset
or liability, either directly or indirectly, and</td></tr><tr><td>– Level 3</td><td>– Unobservable inputs for the asset or liability.</td></tr></table>
Fair value measurements that use inputs of different hierarchy levels are categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.
# (b) Assets and liabilities not carried at fair value but for which fair value is disclosed
Trade and other receivables, trade and other payables, accrued operating expenses and amounts due from/(to) subsidiaries and associates (current)
The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values due to their short-term nature.
# Pledged fixed deposit
The carrying amount of pledged fixed deposit closely approximates its fair value as the interest rate of this financial asset approximates its market rate on or at the end of the reporting period.
# (c) Assets and liabilities not carried at fair value and whose carrying amounts are not reasonable approximation of fair value.
# Amounts due from subsidiaries and associates (non-current) and Contract Deposit
The non-current amounts due from subsidiaries and associates have no fixed terms of repayment. Accordingly, the fair values cannot be measured reliably as the timing of e future cash flows cannot be determined.
Contract Deposit has no fixed terms of repayment. Accordingly, the fair values cannot be measured reliably as the Contract Deposit is interest-free. |
20739465_84.pdf | en | # 28. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group and the Company is exposed to financial risks arising from its operations and the use of financial instruments. The key risks include credit risk, liquidity risk and foreign currency risk. The Board of Directors reviews and agrees policies and procedures for the management of these risks. The Audit Committee provides independent oversight to the effectiveness of the risk management process. It is, and has been throughout the current and previous financial years, the Group’s policy that no trading in derivatives for speculative purposes shall be undertaken.
The following sections provide details regarding the Group’s and Company’s exposure to the above-mentioned financial risks and the objectives, policies and processes for the management of these risks.
# (a) Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group’s and the Company’s exposure to credit risk arises primarily from trade and other receivables, cash and short-term deposits. For other financial assets (including cash and short-term deposits), the Group and the Company minimise credit risk by dealing exclusively with high credit rating counterparties.
The Group’s objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk exposure. The Group trades only with recognised and creditworthy third parties. In addition, receivable balances are monitored on an ongoing basis.
# Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographic region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Group’s performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Group’s policies and procedures include specific guidelines to focus on maintaining a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly. Selective hedging is used within the Group to manage risk concentrations at both the relationship and industry levels. The Group does not apply hedge accounting.
# Exposure to credit risk
At the end of the reporting period, the Group’s and the Company’s maximum exposure to credit risk is represented by the carrying amount of each class of financial assets recognised in the statements of financial position.
Information regarding credit enhancements for trade and other receivables is disclosed in Note 16. |
9285198_410.pdf | en | • authorise the Company to place HKSCC Nominees name on the Company’s register of members as the holder of the Hong Kong Offer Shares allocated to you and to send Share certificate(s) and/or refund monies under the arrangements separately agreed between us and HKSCC;
• confirm that you have read the terms and conditions and application procedures set out in this prospectus and agree to be bound by them;
• confirm that you have received and read a copy of this prospectus and have relied only on the information and representations in this prospectus in causing the application to be made, save as set out in any supplement to this prospectus;
• agree that none of the Company or the Relevant Persons is or will be liable for any information and representations not contained in this prospectus (and any supplement to it);
• agree to disclose to the Company, the Hong Kong Share Registrar, the receiving bank and the Relevant Persons any personal data which they may require about you;
• agree (without prejudice to any other rights which you may have) that once HKSCC Nominees application has been accepted, it cannot be rescinded for innocent misrepresentation;
• agree that any application made by HKSCC Nominees on your behalf is irrevocable on or before the fifth day after the time of the opening of the application lists (excluding any day which is a Saturday, Sunday or public holiday in Hong Kong), such agreement to take effect as a collateral contract with the Company, and to become binding when you give the instructions and such collateral contract to be in consideration of the Company agreeing that it will not offer any Hong Kong Offer Shares to any person on or before the fifth day after the time of the opening of the application lists (excluding any day which is a Saturday, Sunday or public holiday in Hong Kong), except by means of one of the procedures referred to in this prospectus. However, HKSCC Nominees may revoke the application on or before the fifth day after the time of the opening of the application lists (excluding for this purpose any day which is a Saturday, Sunday or public holiday in Hong Kong) if a person responsible for this prospectus under Section 40 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance gives a public notice under that section which excludes or limits that person’s responsibility for this prospectus;
• agree that once HKSCC Nominees’ application is accepted, neither that application nor your electronic application instructions can be revoked, and that acceptance of that application will be evidenced by the Company’s announcement of the results of the Hong Kong Public Offering; |
9285198_411.pdf | en | • agree to the arrangements, undertakings and warranties under the participant agreement between you and HKSCC, read with the General Rules of CCASS and the CCASS Operational Procedures, for giving electronic application instructions to apply for Hong Kong Offer Shares;
• agree with the Company, for itself and for the benefit of each Shareholder (and so that the Company will be deemed by its acceptance in whole or in part of the application by HKSCC Nominees to have agreed, for itself and on behalf of each of the Shareholders, with each CCASS Participant giving electronic application instructions) to observe and comply with the Companies Ordinance, the Companies (Winding Up and Miscellaneous Provisions) Ordinance and the Articles of Association; and
• agree that your application, any acceptance of it and the resulting contract will be governed by and construed in accordance with the Laws of Hong Kong.
# Effect of Giving Electronic Application Instructions to HKSCC via CCASS
By giving electronic application instructions to HKSCC or instructing your broker or custodian who is a CCASS Clearing Participant or a CCASS Custodian Participant to give such instructions to HKSCC, you (and, if you arej oint applicants, each of youj ointly and severally) are deemed to have done the following things. Neither HKSCC nor HKSCC Nominees shall be liable to the Company or any other person in respect of the things mentioned below:
• instructed and authorised HKSCC to cause HKSCC Nominees (acting as nominee for the relevant CCASS Participants) to apply for the Hong Kong Offer Shares on your behalf;
• instructed and authorised HKSCC to arrange payment of the Maximum Offer Price, brokerage, SFC transaction levy and the Stock Exchange trading fee by debiting your designated bank account and, in the case of a wholly or partially unsuccessful application and/or if the Offer Price is less than the Maximum Offer Price per Offer Share initially paid on application, refund of the application monies (including brokerage, SFC transaction levy and the Stock Exchange trading fee) by crediting your designated bank account; and
• instructed and authorised HKSCC to cause HKSCC Nominees to do on your behalf all the things stated in the WHITE Application Form and in this prospectus.
# Minimum Purchase Am ount and Permitted Numbers
You may give or cause your broker or custodian who is a CCASS Clearing Participant or a CCASS Custodian Participant to give electronic application instructions for a minimum of 200 Hong Kong Offer Shares. Instructions for more than 200 Hong Kong Offer Shares must be in one of the numbers set out in the table in the Application Forms. No application for any other number of Hong Kong Offer Shares will be considered and any such application is liable to be rejected. |
2555509_43.pdf | en | # 2. APPLICATION OF NEW AND REVISED HONG KONG FINANCIAL REPORTING STANDARDS (“HKFRSs”) (continued)
# HKFRS 9 Financial Instruments (continued)
# Impairment
In general, the Directors anticipate that the application of the expected credit loss model of HKFRS 9 will result in earlier provision of credit losses which are not yet incurred in relation to the Group’s financial assets measured at amortised costs and other items that subject to the impairment provisions upon application of HKFRS 9 by the Group.
Based on the assessment by the Directors, if the expected credit loss model were to be applied by the Group, the accumulated amount of impairment loss to be recognised by the Group as at 1st January, 2018 would be increased as compared to the accumulated amount recognised under HKAS 39 mainly attributable to expected credit losses provision on debtors. Such further impairment recognised under expected credit loss model would reduce the opening retained profits at 1st January, 2018.
# HKFRS 15 Revenue from Contracts with Customers
HKFRS 15 was issued which establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. HKFRS 15 will supersede the current revenue recognition guidance including HKAS 18 Revenue, HKAS 11 Construction Contracts and the related interpretations when it becomes effective.
The core principle of HKFRS 15 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the standard introduces a 5-step approach to revenue recognition:
• Step 1: Identify the contract(s) with a customer
• Step 2: Identify the performance obligations in the contract
• Step 3: Determine the transaction price
• Step 4: Allocate the transaction price to the performance obligations in the contract
• Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation
Under HKFRS 15, an entity recognises revenue when (or as) a performance obligation is satisfied, i.e. when ‘control’ of the goods or services underlying the particular performance obligation is transferred to the customer. Far more prescriptive guidance has been added in HKFRS 15 to deal with specific scenarios. Furthermore, extensive disclosures are required by HKFRS 15.
In 2016, the HKICPA issued clarifications to HKFRS 15 in relation to the identification of performance obligations, principal versus agent considerations, as well as licensing application guidance. |
2555509_44.pdf | en | # 2. APPLICATION OF NEW AND REVISED HONG KONG FINANCIAL REPORTING STANDARDS (“HKFRSs”) (continued)
# HKFRS 15 Revenue from Contracts with Customers (continued)
The management of the Group anticipate that the application of HKFRS 15 in the future may result in more disclosures, however, the management of the Group do not anticipate that the application of HKFRS 15 will have a material impact on the timing and amounts of revenue recognised in the respective reporting periods.
# HKFRS 16 Leases
HKFRS 16 introduces a comprehensive model for the identification of lease arrangements and accounting treatments for both lessors and lessees. HKFRS 16 will supersede HKAS 17 Leases and the related interpretations when it becomes effective.
HKFRS 16 distinguishes lease and service contracts on the basis of whether an identified asset is controlled by a customer. Distinctions of operating leases and finance leases are removed for lessee accounting, and is replaced by a model where a right-of-use asset and a corresponding liability have to be recognised for all leases by lessees, except for short-term leases and leases of low value assets.
The right-of-use asset is initially measured at cost and subsequently measured at cost (subject to certain exceptions) less accumulated depreciation and impairment losses, adjusted for any remeasurement of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at that date. Subsequently, the lease liability is adjusted for interest and lease payments, as well as the impact of lease modifications, amongst others. For the classification of cash flows, the Group currently presents upfront prepaid lease payments as investing cash flows in relation to leasehold lands for owned use and those classified as investment properties while other operating lease payments are presented as operating cash flows. Upon application of HKFRS 16, lease payments in relation to lease liability will be allocated into a principal and an interest portion which will be presented as financing cash flows by the Group.
Under HKAS 17, the Group has already recognised an asset for prepaid lease payments for leasehold lands where the Group is a lessee. The application of HKFRS 16 may result in potential changes in classification of these assets depending on whether the Group presents right-of-use assets separately or within the same line item at which the corresponding underlying assets would be presented if they were owned.
In contrast to lessee accounting, HKFRS 16 substantially carries forward the lessor accounting requirements in HKAS 17, and continues to require a lessor to classify a lease either as an operating lease or a finance lease.
Furthermore, extensive disclosures are required by HKFRS 16. |
11777419_390.pdf | en | # (ii) Right-of-use assets
The analysis of the net book value of right-of-use assets by class of underlying asset is as follows:
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">As of
August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Buildings leased for own use, carried at depreciated cost ......</td><td>3,386</td><td>3,350</td><td>2,116</td></tr></table>
Orizen Group has obtained the right to use other properties as its offices and warehouses through tenancy agreements. The leases typically run for an initial period of 1 to 3 years.
The analysis of expense items in relation to leases recognized in the consolidated statement of profit or loss and other comprehensive income is as follows:
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">Period from
April 1, 2019 to
August 6, 2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Depreciation charge of rihgt-of-use assets by class of
underliyng asset:</td><td></td><td></td><td></td></tr><tr><td>Buildings leased for own use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .</td><td>616</td><td>2,431</td><td>1,744</td></tr><tr><td>Interest on lease liabilities (note (3)(i)) . . . . . . . . . . . . . . . . . . . . .</td><td>43</td><td>117</td><td>35</td></tr></table>
# (8) Investment in a subsidiary
Details of Orizen’s subsidiary are as follows:
<table><tr><td rowspan="2">Company name</td><td rowspan="2">Form of
business
structure</td><td rowspan="2">Place of
incorporation
and
business</td><td rowspan="2">Particulars
of issued
and paid-up
caiptal</td><td colspan="3">Proportion of ownership interest</td><td rowspan="2">Principal
activities</td></tr><tr><td>effective
interest</td><td>Held by
Orizen</td><td>Held by a
subsidiary</td></tr><tr><td>PCCH</td><td> Incorporated</td><td> Hong Kong</td><td> 100 ordinary
shares</td><td>100%</td><td>100%</td><td> –</td><td> Trading,
wholesaling
and
retailing
of Chinese
medicine</td></tr></table>
# (9) Inventories
# (i) Inventories in the consolidated statement of financial position comprise:
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">As of
August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Finished goods ..........................................</td><td>16,424</td><td>11,649</td><td>12,084</td></tr></table>
# (10) Trade and other receivables
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">As of
August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Trade receivables ........................................</td><td>7,334</td><td>8,067</td><td>8,896</td></tr><tr><td>Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .</td><td>1</td><td>679</td><td>693</td></tr><tr><td>Deposits and prepayments ................................</td><td>1,530</td><td>881</td><td>1,223</td></tr><tr><td></td><td>8,865</td><td>9,627</td><td>10,812</td></tr></table>
At March 31, 2018 and 2019 and August 6, 2019, the deposits and prepayments expected to be recovered after more than one year amounted to HK\$745,000, HK\$727,000 and HK\$926,000 respectively. The remaining trade and other receivables are expected to be recovered within one year.
Orizen Group normally allows a credit period of within 90 days to its customers. |
11777419_391.pdf | en | # Aging analysis
As of the end of the reporting period, the aging analysis of trade receivables (which are included in trade and other receivables) based on the invoice date and net of loss allowance, is as follows:
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">As of
August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Less than 1 month .......................................</td><td>5,512</td><td>6,494</td><td>6,742</td></tr><tr><td>1to6months............................................
</td><td>1,822</td><td>1,573</td><td>2,154</td></tr><tr><td></td><td>7,334</td><td>8,067</td><td>8,896</td></tr></table>
The aging analysis of trade receivables (net of loss allowance) by due dates is as follows:
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">As of
August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Current .................................................</td><td>5,512</td><td>6,494</td><td>6,150</td></tr><tr><td>Less than 1 month past due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .</td><td>946</td><td>666</td><td>1,667</td></tr><tr><td>1 to 3 months past due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .</td><td>581</td><td>455</td><td>791</td></tr><tr><td>Over 3 months past due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .</td><td>295</td><td>452</td><td>288</td></tr><tr><td></td><td>7,334</td><td>8,067</td><td>8,896</td></tr></table>
# (11) Cash and cash equivalents and other cash flow information
# (i) Cash and cash equivalents comprise:
<table><tr><td rowspan="3"></td><td colspan="2">As of March 31,</td><td rowspan="2">As of
August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Cash at bank and on hand .................................</td><td>9,806</td><td>23,155</td><td>5,260</td></tr></table>
# (ii) Reconciliation of profit before taxation to cash generated from operations:
<table><tr><td rowspan="3"></td><td rowspan="3">Note</td><td colspan="2">Year ended March 31,</td><td rowspan="2">Period from
April 1, 2019
to August 6,
2019</td></tr><tr><td>2018</td><td>2019</td></tr><tr><td>HK$’000</td><td> HK$’000</td><td> HK$’000</td></tr><tr><td>Operating activities</td><td></td><td></td><td></td><td></td></tr><tr><td>Profit before taxation ...................................</td><td></td><td>24,717</td><td>26,166</td><td>10,655</td></tr><tr><td>Adjustments for:</td><td></td><td></td><td></td><td></td></tr><tr><td>Depreciation ..........................................</td><td>(3)(iii)</td><td>786</td><td>2,617</td><td>1,804</td></tr><tr><td>Finance costs ..........................................</td><td>(3)(i)</td><td>43</td><td>117</td><td>35</td></tr><tr><td>Interest income from bank deposits . . . . . . . . . . . . . . . . . . . . . .</td><td>(2)</td><td>(2)</td><td>(6)</td><td>(12)</td></tr><tr><td>Changes in workinig calpta:</td><td></td><td></td><td></td><td></td></tr><tr><td>(Increase)/decrease in inventories ........................</td><td></td><td>(9,484)</td><td>4,775</td><td>(435)</td></tr><tr><td>Decrease/(increase) in trade and other receivables ..........</td><td></td><td>1,313</td><td>(762)</td><td>(1,185)</td></tr><tr><td>Increase/(decrease) in trade and other payables ............</td><td></td><td>5,187</td><td>2,416</td><td>(8,127)</td></tr><tr><td>Cash generated from operations ........................</td><td></td><td>22,560</td><td>35,323</td><td>2,735</td></tr></table> |
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