POWERLONG COMMERCIAL MANAGEMENT HOLDINGS LIMITED Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
Powerlong Commercial Management Holdings Limited ᘒᎲਠุ၍ଣછٰϞࠢʮ̡
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 9909)
2020 ANNUAL RESULTS ANNOUNCEMENT
SUMMARY OF RESULTS
• Revenue of the Group for the year ended 31 December 2020 amounted to approximately RMB1,921.2 million, representing an increase of approximately 18.6% as compared with approximately RMB1,620.5 million for the year ended 31 December 2019.
• Gross profit of the Group for the year ended 31 December 2020 amounted to approximately RMB594.5 million, representing an increase of approximately 38.8% as compared with approximately RMB428.4 million for the year ended 31 December 2019.
• Profit of the Group for the year ended 31 December 2020 amounted to approximately RMB307.4 million, representing an increase of 72.1% as compared with approximately RMB178.6 million for the year ended 31 December 2019. At the same time, profit attributable to the owners of the Company for the year ended 31 December 2020 amounted to approximately RMB305.1 million, representing an increase of 70.8% as compared with approximately RMB178.6 million for the year ended 31 December 2019. (Disregarding the deduction of management fee of approximately RMB18.4 million incurred by share incentives, the actual profit attributable to the owners of the Company would amount to approximately RMB323.5 million.)
• As at 31 December 2020, the gross floor area ("GFA")Note in operation of the Group's commercial operational services amounted to 8.6 million square meters, representing an increase of approximately 1.6 million square meters as compared with 7.0 million square meters as at 31 December 2019; and the GFA delivered of residential property management services amounted to 14.4 million square meters, representing an increase of approximately 2.9 million square meters as compared with 11.5 million square meters as at 31 December 2019.
• The Board recommends the payment of a final dividend of HK$0.18 per ordinary share for the year ended 31 December 2020. Together with the interim dividend of HK$0.1 per ordinary share for the six months ended 30 June 2020, the total dividend for the year ended 31 December 2020 amounted to HK$0.28 per ordinary share.
Note: Unless otherwise stated, all "GFA" of commercial properties referred to in this announcement include car parks.
ANNUAL RESULTS
The board of directors (the "Board") of Powerlong Commercial Management Holdings Limited (the "Company" or "Powerlong CM") is pleased to announce the annual consolidated results of the Company and its subsidiaries (collectively, the "Group") for the year ended 31 December 2020, together with comparative figures for the year ended 31 December 2019, as follows.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year ended 31 December 2020 2019
NoteRMB'000 RMB'000
Revenue | 4 | 1,921,238 | 1,620,457 |
Cost of services | (1,326,692) | (1,192,050) | |
Gross profit | 594,546 | 428,407 | |
Selling and marketing expenses | (36,334) | (41,856) | |
Administrative expenses | (134,407) | (117,231) | |
Other income and gains | 5 | 32,613 | 17,295 |
Net impairment losses on financial assets | (22,846) | (7,244) | |
Operating profit | 433,572 | 279,371 | |
Finance costs | (33,811) | (40,262) | |
Finance income | 23,164 | 8,160 | |
Finance costs - net | (10,647) | (32,102) | |
Share of net losses of joint ventures accounted | |||
for using the equity method | (3,009) | - | |
Profit before income tax | 419,916 | 247,269 | |
Income tax expenses | 6 | (112,550) | (68,655) |
Profit and total comprehensive income for the year | 307,366 | 178,614 | |
Profit and total comprehensive income | |||
attributable to: | |||
- Shareholders of the Company | 305,064 | 178,614 | |
- Non-controlling interests | 2,302 | - | |
307,366 | 178,614 | ||
Earnings per share for profit attributable to | |||
shareholders of the Company for the year | |||
(expressed in RMB cents per share) | |||
- Basic earnings per share | 7 | 49.12 | 44.01 |
- Diluted earnings per share | 7 | 49.11 | 44.01 |
CONSOLIDATED BALANCE SHEET
2019 | |||
Note | RMB'000 | RMB'000 | |
Assets | |||
Non-current assets | |||
Property and equipment | 9,819 | 6,928 | |
Financial assets at fair value through profit or loss | 313 | - | |
Investment properties | 688,205 | 207,207 | |
Intangible assets | 5,420 | - | |
Goodwill | 20,640 | - | |
Deferred income tax assets | 74,457 | 48,421 | |
Investments accounted for using the equity method | 2,511 | 4,700 | |
801,365 | 267,256 | ||
Current assets | |||
Operating lease and trade receivables | 9 | 161,954 | 113,881 |
Prepayments and other receivables | 104,759 | 91,114 | |
Current income tax recoverables | 2,726 | 2,705 | |
Restricted cash | 518 | 19 | |
Cash and cash equivalents | 3,449,101 | 2,616,113 | |
3,719,058 | 2,823,832 | ||
Total assets | 4,520,423 | 3,091,088 |
As at 31 December 2020
CONSOLIDATED BALANCE SHEET (continued)
2019 | |||
Note | RMB'000 | RMB'000 | |
Equity | |||
Share capital and premium | 10 | 1,479,288 | 1,236,907 |
Other reserves | 42,033 | 22,430 | |
Shares held for shares award scheme | (95) | - | |
Retained earnings | 631,712 | 327,835 | |
Capital and reserves attributable to shareholders | |||
of the Company | 2,152,938 | 1,587,172 | |
Non-controlling interests | 12,965 | - | |
Total equity | 2,165,903 | 1,587,172 | |
Liabilities | |||
Non-current liabilities | |||
Deferred income tax liabilities | 2,891 | - | |
Long-term payables | 3,271 | - | |
Lease liabilities | 659,816 | 190,487 | |
665,978 | 190,487 | ||
Current liabilities | |||
Trade and other payables | 11 | 1,060,984 | 763,111 |
Advances from lessees | 14,889 | 27,488 | |
Current income tax liabilities | 101,410 | 33,562 | |
Lease liabilities | 202,072 | 226,066 | |
Contract liabilities | 309,187 | 263,202 | |
1,688,542 | 1,313,429 | ||
Total liabilities | 2,354,520 | 1,503,916 | |
Total equity and liabilities | 4,520,423 | 3,091,088 |
As at 31 December 2020
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 GENERAL INFORMATION
Powerlong Commercial Management Holdings Limited (the "Company") was established in the Cayman Islands on 25 March 2019 as an exempted company with limited liability under the Companies Law, Cap. 22 (Law 3 of 1961, as consolidated and revised) of the Cayman Islands. The address of the Company's registered office is Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands.
The Company and its subsidiaries (the "Group") are primarily engaged in the provision of commercial operational services and residential property management services (the "Spin-off Business") in the People's Republic of China (the "PRC").
The Company was listed on The Stock Exchange of Hong Kong Limited (the "Stock Exchange") on 30
December 2019.
The Company's parent company is Powerlong Real Estate (BVI) Holdings Limited ("Powerlong BVI Holdings"). The Company's intermediate holding company is Powerlong Real Estate Holdings Limited ("Powerlong Holdings") whose shares have been listed on the Main Board of the Stock Exchange since 14 October 2009. As at 31 December 2020, Mr. Hoi Kin Hong ("Mr. Hoi") held approximate 44.33% of interests in the issued share capital of Powerlong Holdings.
The initial listing of the Company's Shares on the Main Board of the Stock Exchange ("Listing") constitutes a spin-off from Powerlong Holdings ("Spin-off"). Powerlong Holdings and its subsidiaries exclusive of the Group are collectively referred to as the Remaining Powerlong Group in these consolidated financial statements.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied in all the years presented, unless otherwise stated.
2.1 Basis of preparation
(i) Compliance with HKFRS and HKCO
The consolidated financial statements have been prepared in accordance with Hong Kong Financial Reporting Standards ("HKFRS") and disclosure requirements of the Hong Kong Companies Ordinance Cap. 622.
(ii) Historical cost convention
The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets at fair value through profit or loss.
(iii) New standards, amendments and interpretations adopted by the Group
The Group has applied the following standards and amendments for the first time for their annual reporting period commencing 1 January 2020:
• Definition of Material - amendments to HKAS 1 and HKAS 8
• Definition of a Business - amendments to HKFRS 3
• Interest Rate Benchmark Reform - amendments to HKFRS 7, HKFRS 9 and HKAS 39
• Revised Conceptual Framework for Financial Reporting
• Covid-19-Related Rent Concessions - amendments to HKFRS 16
(iv) New standards, amendments, interpretations and accounting guideline not yet adopted
The following new standards and amendments, interpretation and accounting guideline to standards have been published that are not mandatory for the year ended 31 December 2020 and have not been early adopted by the Group:
Effective for annual periods beginning on or after
HKFRS 17 | Insurance contract | 1 January, 2023 |
Amendments to HKAS 1 | Classification of liabilities as | 1 January, 2023 |
current or non-current | ||
Hong Kong Interpretation 5 (2020) | Presentation of Financial | 1 January, 2023 |
Statements - Classfication by | ||
the Borrower of a Term Loan | ||
Amendments to HKFRS 3 | Update reference to the conceptual | 1 January, 2022 |
framework | ||
Amendments to HKAS 16 | Proceeds before intended use | 1 January, 2022 |
Amendments to HKAS 37 | Onerous contracts - costs of | 1 January, 2022 |
fulfilling a contract | ||
Annual Improvements | Annual Improvements to HKFRS | 1 January, 2022 |
Standards 2018-2020 Cycle | ||
Revised Accounting Guideline 5 | Merger Accounting for Common | 1 January, 2022 |
Control Combination | ||
Amendments to HKFRS 9, HKAS 39, | Interest Rate Benchmark Reform - | 1 January, 2021 |
HKFRS 4 and HKFRS 16 | Phase two | |
Amendments to HKFRS 10 and | ||
HKAS 28 |
Sale or contribution of assets between an investor and its associate or joint ventures
To be determinedThe Group has already commenced an assessment of the impact of these new or revised standards and amendments. According to the preliminary assessment made by the Group, these standards are not expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions.
3 SEGMENT INFORMATION
Management has determined the operating segments based on the reports reviewed by CODM. The CODM, who is responsible for allocating resources and assessing performance of the operating segment, has been identified as the executive directors of the Company.
The Group has two business segments:
- Commercial operational services
The Group is engaged in (a) the provision of market research and positioning, business tenant sourcing and opening preparation services; (b) commercial operational services during the operation stage, including business tenant management, rent collection services and other value-added services (mainly including car parks, common areas and advertising space management services); and (c) commercial property management services including security, gardening, cleaning, repair and maintenance services.
Besides, to maximise its commercial operational efficiency, the Group leased certain retail commercial properties nearby the shopping malls under management by the Group, and sub-leased them for long-term rental yield.
- Residential property management services
The Group provides residential property management services of residential properties, serviced apartments and office building, including pre-sale management services and other value-added services to property developers, property owners and residents.
As the CODM considers most of the Group's consolidated revenue and results are attributable to the market in the PRC and the Group's consolidated non-current assets are substantially located in the PRC, no geographical information is presented.
(a) Segment results represent the profit earned by each segment without other income and gains, unallocated operating costs, finance costs-net, shares of net losses of joint ventures accounted for using the equity method and income tax expenses. Revenue recognised at a point in time from contracts with customers represents revenue from market research and positioning services. Other revenue from contracts with customers is recognised over time. The following is the analysis of the Group's revenue and results by operating and reportable segments:
For the year ended 31 December 2020
Residential
Commercial operational services RMB'000
property management services RMB'000
Group RMB'000
Gross segment revenueRevenue from contracts with customers - at a point in time - over time
- 358,313
85,803 1,653,946
1,562,925 1,381,436 85,803 1,295,633
358,313 1,921,238
358,313 1,739,749
Revenue from other sources - rental income
Segment results
181,489 417,751
- 181,489
55,325 473,076
Other income and gains 32,613
Unallocated operating costs (72,117)
Interest expense (33,811)Interest income
23,164
Share of net losses of joint ventures accounted for using the equity method
(3,009)
Profit before income tax Income tax expenses
419,916 (112,550)
Profit for the year 307,366
Depreciation and amortisation
96,749
1,575 98,324
For the year ended 31 December 2019
Commercial operational services RMB'000
Residential property management services RMB'000
Group RMB'000
Gross segment revenueRevenue from contracts with customers - at a point in time - over time
Revenue from other sources - rental income
Segment results
1,335,109 1,129,750 46,225 1,083,525
285,348 1,620,457
285,348 1,415,098
- 285,348
46,225 1,368,873
205,359 303,511
- 205,359
31,988 335,499
Other income and gains 17,295
Unallocated operating costs (73,423)
Interest expense (40,262)Interest income
Foreign exchange gains on financing activities-net
Profit before income tax Income tax expenses
7,718
442 247,269 (68,655)
Profit for the year 178,614
Depreciation and amortisation
98,974
4,862 103,836
(b)The following is the analysis of the Group's segment assets and liabilities and capital expenditure for the year then ended:
As at 31 December 2020
Residential
Commercial operational services RMB'000
property management services RMB'000
Elimination
RMB'000
Group RMB'000
Segment assets
1,123,065
100,751
(4,512) 1,219,304
Other assets 3,301,119
Total assets 4,520,423
Segment liabilities Other liabilities
2,005,859
215,673
(4,512) 2,217,020 137,500
Total liabilities
2,354,520
Capital expenditure
As at 31 December 2019
586,382
Commercial operational services RMB'000
1,631
Residential property management services RMB'000
-
588,013
Elimination
RMB'000
Group RMB'000
Segment assets
417,372
117,109
(11,637) 522,844
Other assets 2,568,244
Total assets 3,091,088
Segment liabilities Other liabilities
1,184,514
189,617
(11,637) 1,362,494 141,422
Total liabilities
1,503,916
Capital expenditure
153,259
1,806
-
155,065
Segment assets are reconciled to total assets as follows:
As at 31 December 2020 2019
RMB'000 RMB'000
Segment assets Other assets
1,219,304 522,844
Current income tax recoverables Deferred income tax assets
2,726 2,705
74,457 48,421
Unallocated cash and cash equivalents and restricted cash Unallocated property and equipment
Other corporate assets
Financial assets at fair value through profit and loss
3,212,997 220 10,406 313
2,515,618 35 1,465 -
Total assets
4,520,423
3,091,088
Segment liabilities are reconciled to total liabilities as follows:
As at 31 December 2020 2019
RMB'000 RMB'000
Segment liabilities
Other liabilities
Current income tax liabilities Deferred income tax liabilities Other payables due to related parties Other corporate liabilities
Total liabilities
2,217,020 | 1,362,494 |
101,410 | 33,562 |
2,891 | - |
3,410 | 88,759 |
29,789 | 19,101 |
2,354,520 | 1,503,916 |
The amounts provided to the CODM with respect to total assets and liabilities are measured in a manner consistent with that of the consolidated financial statements. These assets and liabilities are allocated based on the operations of the segment.
Segment assets consist primarily of property and equipment, investment properties, intangible assets, receivables from commercial and residential property management services and cash and cash equivalents.
Segment liabilities consist primarily of trade and other payables (excluding other payables due to related parties with non-trade nature), lease liabilities, contract liabilities, advances from lessees and long-term payables.
Capital expenditure comprises additions to property and equipment and investment properties.
4 REVENUE
(a) Revenue of the Group for the year ended 31 December 2020 is as follows:
Year ended 31 December 2020 2019
RMB'000 RMB'000
Type of services
Rental income:
- Commercial property lease income | 181,489 | 205,359 |
Revenue from customer: | ||
- Market research and positioning, business tenant | ||
sourcing, opening preparation services | 214,708 | 143,231 |
- Commercial operation and management services | 1,166,728 | 986,519 |
- Commercial operation service during the | ||
operation stage | 370,032 | 318,905 |
- Commercial property management service | 796,696 | 667,614 |
- Commercial operational services | 1,381,436 | 1,129,750 |
- Pre-sale management services | 14,730 | 13,128 |
- Residential property management services | 271,362 | 222,217 |
- Other value-added services | 72,221 | 50,003 |
- Residential property management services | 358,313 | 285,348 |
1,921,238 | 1,620,457 | |
Type of customers | ||
Rental income | ||
External customers (iii) | 181,489 | 205,359 |
External customers (iii) | 1,114,694 | 927,357 |
Fellow subsidiaries (i) | 189,428 | 180,964 |
Other related parties (ii) | 77,314 | 21,429 |
Commercial operational services | 1,381,436 | 1,129,750 |
External customers (iii) | 296,131 | 237,278 |
Fellow subsidiaries (i) | 57,351 | 46,725 |
Other related parties (ii) | 4,831 | 1,345 |
Residential property management services | 358,313 | 285,348 |
1,921,238 | 1,620,457 |
(i) For the year ended 31 December 2020, revenue arising from the Remaining Powerlong Group and other entities controlled by Mr. Hoi (the "Fellow Subsidiaries") contributed 12.8% of the Group's revenue (2019: 14.1%). Other than the Fellow Subsidiaries, the Group has a large number of customers, none of whom contributed 10% or more of the Group's revenue during the year (2019: none).
(ii) Other related parties represented associates or jointly controlled entities of the Remaining Powerlong Group.
(iii) External customers represented independent third parties.
(b) Liabilities related to contracts with customers
As at 31 December 2020 2019
RMB'000 RMB'000
Contract liabilities
309,187
263,202
Contract liabilities of the Group mainly arose from the advance payments made by the customers while the underlying services are yet to be provided. Such liabilities increased as a result of the growth of the Group's business.
(i) Revenue recognised in relation to contract liabilities.
The following table shows how much of the revenue recognised in the current reporting period relates to carried-forward contract liabilities.
Year ended 31 December 2020 2019
RMB'000 RMB'000
Revenue recognised that was included in the contract liability balance at the beginning of the year - Commercial operational services - Residential property management services
210,562 106,882
52,640 26,897
263,202 133,779
(ii) Unsatisfied performance obligations
For commercial operational services and residential property management services, the Group recognises revenue in the amount that equals to the rights to invoices which corresponds directly with the value to the customers of the Group's performance to date, on a monthly or quarterly basis. The Group has elected the practical expedient for not to disclose the remaining performance obligations for those types of contracts. The majority of the property management services contracts and property developer-related services do not have a fixed term. The term of the contracts for other value-added services is generally set to expire when the counterparties notify several months in advance the Group that the services are no longer required.
5 OTHER INCOME AND GAINS
6 INCOME TAX EXPENSES
Penalty income | 14,152 | 10,297 |
Government grants (Note (a)) | 13,223 | 2,288 |
Others | 1,577 | 2,655 |
28,952 | 15,240 | |
Other gains | ||
Gain on lease termination | - | 2,055 |
Foreign exchange gains | 1,661 | - |
Gain on disposal of an associate | 2,000 | - |
3,661 | 2,055 | |
32,613 | 17,295 | |
Year ended 31 December 2020 2019
Other income
(a)The government grants represented mainly tax refunds, rewards and rental refunds for COVID-19 from local government without attached conditions.
Current income tax - PRC corporate income tax
RMB'000 RMB'000
Year ended 31 December 2020 2019
RMB'000 RMB'000
136,941 63,829
Deferred income tax - PRC corporate income tax
(24,391) 4,826
112,550 68,655
The tax on the Group's profit before income tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to profits of the group entities as follows:
Year ended 31 December 2020 2019
RMB'000 RMB'000
Profit before income tax | 419,916 | 247,269 |
Tax charge at statutory tax rate of 25% to profits | ||
in the respective group entities | 104,979 | 61,817 |
Tax effects of: | ||
- Expenses not deductible for tax purposes | 8,810 | 8,978 |
- Effect of income not subject to income tax | (415) | (896) |
- Tax losses for which no deferred income tax asset | ||
was recognised | 471 | - |
- Utilisation of tax losses previously not recognised | ||
for deferred tax asset | (1,295) | (1,244) |
PRC corporate income tax | 112,550 | 68,655 |
The effective income tax rate was 26.80% and 27.77% for the years ended 31 December 2020 and 2019.
PRC corporate income tax
Income tax provision of the Group in respect of operations in the PRC has been calculated at the statutory tax rate of 25% on the estimated assessable profits for the year, based on the existing legislation, interpretations and practices in respect thereof.
The general corporate income tax rate in the PRC is 25%.
Overseas income tax
The Company was incorporated in the Cayman Islands as an exempted company with limited liability under the Companies Law, Cap 22 of Cayman Islands and pursuant to the rules and regulations of Cayman Islands, the Company is not subject to any income tax. The Company's subsidiaries in the British Virgin Islands were incorporated under the International Business Companies Act (as amended) of the British Virgin Islands and, accordingly are exempted from British Virgin Islands income tax.
Hong Kong profits tax
No provision for Hong Kong profits tax has been made in these consolidated financial statements as the Company and the Group did not have assessable profit in Hong Kong during the year ended 31 December 2020 (2019: nil). The profit of the group entities in Hong Kong is mainly derived from dividend income, which is not subject to Hong Kong profits tax.
7 EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of ordinary shares in issue during the year ended 31 December 2020.
In determining the weighted average number of ordinary shares in issue during the year ended 31 December 2019, the ordinary shares issued upon the incorporation of the Company, the ordinary shares issued in the reorganization undertaken for the initial listing on 19 July 2019, and the capitalisation issue on 10 December 2019, were deemed to be issued on 1 January 2019 as if the Company has been incorporated by then.
Year ended 31 December 2020
2019
Earnings (RMB'000)
Earning for the purposes of basic and diluted earnings per share
(profit for the year attributable to owners of the Company)
305,064 178,614
Number of shares ('000)
Weighted average number of ordinary shares for the purpose of basic earnings per share
621,117 405,822
Effect of dilutive potential ordinary shares: Awarded shares
26
-
Weighted average number of ordinary shares for the purpose of diluted earnings per share
621,143
405,822
8 DIVIDEND
(a) An interim dividend of HK$10.0 cents (equivalent to RMB9.1 cents based on the exchange rate of 30 June 2020) per ordinary share, total amount of interim dividend of HK$62,150,000 (equivalent to approximately RMB56,770,000) was paid.
(b) On 2 March 2021, the Board recommended the payment of a final dividend of HK$18.0 cents (equivalent to RMB15.1 cents based on the exchange rate of 31 December 2020) per ordinary share. Total amount of final dividend would be HK$113,895,000 (equivalent to approximately RMB95,859,000) which is calculated according to the ordinary shares in issue as at 31 December 2020 excluding shares held for shares award scheme. The recommended final dividend in respect of 2020 is subject to the approval of shareholders in the forthcoming annual general meeting. These consolidated financial statements do not reflect this dividend payable.
9 OPERATING LEASE AND TRADE RECEIVABLES
As at 31 December 2020 2019
RMB'000 RMB'000
Operating lease receivables (Note (a))
- Third parties | 17,170 | 4,660 |
Trade receivables (Note (a)) | ||
- Related parties | 32,718 | 47,707 |
- Third parties | 154,943 | 82,688 |
187,661 | 130,395 | |
Less: allowance for impairment (Note (b)) | (42,877) | (21,174) |
161,954 | 113,881 |
(a) The Group's revenue is derived from provision of commercial operational services, residential property management services and lease of properties. Proceeds in respect of service rendering and rental income are to be received in accordance with the terms of relevant property service agreements and tenant contracts.
As at the respective balance sheet date, the ageing analysis of the operating lease and trade receivables due from related parties and third parties based on the demand note dates is as follows:
As at 31 December 2020 2019
RMB'000 RMB'000
0-30 days
49,187
23,070
31-180 days
51,472
46,391
181-365 days
46,128
14,472
1-2 years
20,386
29,036
2-3 years
20,319
14,338
Over 3 years
17,339
7,748
204,831
135,055
(b) The Group applies the simplified approach to provide for expected credit losses prescribed by HKFRS 9. As at 31 December 2020, a provision of RMB42,877,000 (2019: RMB21,174,000) was made against the gross amounts of operating lease and trade receivables.
(c) As at 31 December 2020 and 31 December 2019, the operating lease and trade receivables were denominated in RMB, and the fair values approximated their carrying amounts.
10 SHARE CAPITAL AND PREMIUM
Number of | ||||||
ordinary | Share | |||||
shares | premium | Total | ||||
HK$'000 | RMB'000 | RMB'000 | RMB'000 | |||
2,000,000,000 | 20,000 | 17,905 | - | 17,905 | ||
600,000,000 | 6,000 | 5,376 | 1,231,531 | 1,236,907 | ||
- | - | - | (165,123) | (165,123) | ||
the over-allotment option | (a) | 22,500,000 | 225 | 199 | 184,448 | 184,647 |
Repurchased | (b) | (1,000,000) | (10) | (9) | (8,543) | (8,552) |
Issue of shares | (c) | 11,250,000 | 113 | 95 | 231,219 | 231,314 |
Awarded shares | (d) | 11,250,000 | 112 | 95 | - | 95 |
As at 31 December 2020 | 644,000,000 | 6,440 | 5,756 | 1,473,532 | 1,479,288 |
Share capital
Authorised
As at 1 January 2020 and
31 Dec 2020
Issued
As at 1 January 2020 Dividends
Issued upon the exercise of
(a) On 22 January 2020, 22,500,000 shares were issued upon the exercise of the over-allotment option in connection with the Listing at a price of HK$9.50 per share. Net proceeds of the additional offering, after net of transactions cost attributable to the exercise of the over-allotment option of approximately HK$5,788,000 (equivalent to approximately RMB5,170,000), amounted to approximately HK$207,962,000 (equivalent to approximately RMB184,647,000).
(b) On 30 January 2020 and 31 January 2020, the Company repurchased a total of 1,000,000 ordinary shares with cash considerations including transaction cost of approximately HK$9,518,000 (equivalent to approximately RMB8,552,000) and such ordinary shares were cancelled on 24 March 2020.
(c) On 10 September 2020, the Company entered into a subscription agreement with Mr. Chen Deli ("Mr. Chen"), an executive director and the chief executive officer of the Company, pursuant to which, the Company has conditionally agreed to allot and issue, and Mr. Chen has conditionally agreed to subscribe for the 11,250,000 new shares, at the subscription price of HK$24.30 per share upon the terms and subject to the conditions set out in the subscription agreement. The Company had sought and obtained shareholders' approval at the extraordinary general meeting held on 24 November 2020. The subscription shares have been issued and allotted on 4 December 2020, amounted to approximately HK$273,375,000 (equivalent to approximately RMB231,314,000).
(d) On 24 November 2020, the Company's shareholders approved and adopted a shares award scheme ("Shares Award Scheme") and the Company has appointed Tricor Trust (Hong Kong) Limited as the trustee (the "Trustee") to assist with the administration of the awarded shares and Elitelong Holdings Limited, a wholly-owned subsidiary of the Trustee, as nominee. On 4 December 2020, the Board of the Company approved a new issuance of 11,250,000 ordinary shares to the Elitelong Holdings Limited.
Elitelong Holdings Limited was set up as a special vehicle for the purpose of holding the ordinary shares allotted and issued by the Company. As the Company has the power to direct the relevant activities of Elitelong Holdings Limited and can derive benefits from the contributions of the grantees, therefore, Elitelong Holdings Limited is consolidated by the Company and the 11,250,000 shares it held are presented as a deduction in equity as shares held for the Shares Award Scheme.
11 TRADE AND OTHER PAYABLES
As at 31 December 2020 2019
RMB'000 RMB'000
Trade payables
- Related parties | 2,156 | 1,126 |
- Third parties | 118,343 | 88,668 |
120,499 | 89,794 | |
Other payables | ||
- Related parties | 161,826 | 88,759 |
- Receipts on behalf of tenants or residents (Note (a)) | 194,420 | 144,158 |
- Payables for promotion fees on behalf of owners of | ||
the commercial properties (Note (b)) | 31,119 | - |
- Deposits received (Note (c)) | 364,415 | 301,187 |
- Listing expenses payable | - | 14,461 |
- Payable for business combination | 10,239 | - |
- Others | 17,645 | 13,342 |
779,664 | 561,907 | |
Accrued payroll | 140,903 | 103,950 |
Other taxes payables | 19,918 | 7,460 |
1,060,984 | 763,111 |
(a) Amounts represented the receipts on behalf of tenants or residents to settle the bills of utilities charges.
(b) Usually, fees relating to promotion activities for commercial properties would be borne by the owners of the commercial properties. An budget would be reviewed by the property owners and prepaid to the Group in advance for subsequent usage. Amounts represented the payables to third parties suppliers in relation to promotion activities occurred on behalf of owners of commercial properties.
(c) Amounts represented mainly deposits received from tenants as performance securities in relation to tenant agreements or property management service agreements.
(d) As at 31 December 2020 and 2019, the carrying amounts of trade and other payables approximated their fair values.
(f) Trade and other payables (excluding accrued payroll and other tax payables) were denominated in the following currencies:
(e) As at the respective balance sheet date, the ageing analysis of the trade payables (including amounts due to related parties) based on invoice dates is as follows:
Within 1 year
116,029
86,024
1 to 2 years
3,598
1,585
2 to 3 years
872
2,185
120,499
89,794
As at 31 December 2020 2019
RMB'000 RMB'000
As at 31 December 2020 2019
RMB'000 RMB'000
RMB
900,155
630,500
HK$
8
526
US$
-
20,675
900,163
651,701
MANAGEMENT DISCUSSION AND ANALYSIS
OVERVIEW
The Group is a leading commercial operational service provider in China. As at 31 December 2020, the Group had 68 retail commercial properties in operation, with an aggregate GFA in operation of approximately 8.6 million sq.m.; and was contracted to provide commercial operational services for a total of 105 retail commercial properties with an aggregate contracted GFA of 11.3 million sq.m. Save as aforementioned contracted projects, the Company has reached preliminary cooperation intention (contacts to be signed) with owners of 16 retail commercial properties, with an aggregate GFA of approximately 1.3 million sq.m. The Company enjoys considerable brand recognition in the markets where it operates. The Company was awarded various types of honors in 2020, such as 2020 China Top 10 Commercial Real Estate (2020ʕਠุήପɤ੶) awarded by China Index Academy (ʕܸ ᅰӺ৫), 2020 China Top 10 Commercial Real Estate Brand (2020ϋʕਠุήପۜɤ ੶) awarded by Leju Financial Research Institute (ᆀ֢ৌӺ৫), Listed Companies with the Most Growth Potential in 2020 (2020ϋܓ௰Ոᆑɢɪ̹ʮ̡) awarded by Sina Finance (อ ईৌ) and other awards.
The Group also provides property management services for residential properties, office buildings and serviced apartments. As at 31 December 2020, the Group had 61 delivered projects of its residential property management service with an aggregate GFA delivered of approximately 14.4 million sq.m., and was contracted to manage 101 projects with an aggregate contracted GFA of 23.2 million sq.m.
With the mission of creating "space full of love", the Company endeavours to link up living space with the well-being of everything, to promote love and care among people and within cities. It also seeks to deliver living space and services that represent the best experience to property owners, tenants and consumers.
BUSINESS REVIEW
For the year ended 31 December 2020, the Group mainly conducted its business activities in the following business segments namely (i) commercial operational services; and (ii) residential property management services. The Group's revenue derived mainly from its commercial operational services.
Commercial operational services: The Company provided full-chain services covering positioning, tenant sourcing, opening, operation and management to shopping malls and shopping streets.
It primarily included:
(i) Market research and positioning, tenant sourcing and opening preparation services to property developers or property owners during the preparation stage before the opening of a retail commercial property;
(ii) Commercial operation and management services to property owners or tenants during the operation stage of a retail commercial property; and
(iii) Property leasing services with respect to units located within the shopping streets and shopping malls.
The management models of the retail commercial properties undertaken by the Group includes the following three models:
1. Entrusted operation and management
The owner entrusts the operation and management of the retail commercial properties to the Group, and the operating costs of the projects are borne by the Group. The owners receive rents for shops and some income from diversified operations and parking lot operations.
The Group charges the owner:
(i) income for advisory consultation before the projects are in operation; (ii) rent management fee during the operation stage of the projects i.e. a certain percentage of the rent; and (iii) brand usage fee (only for projects not developed by Powerlong Real Estate).
The Group charges the tenants and consumers:
(i) operation and management service fees during project operation; (ii) income from diversified operations; and (iii) parking fees.
2. Advisory consultationThe owner engages the Group as a management advisory consultant for retail commercial properties, and all income and costs of project operation are borne by the owner.
The Group charges the owner: (i) income for advisory consultations before the projects are in operation; and (ii) a certain percentage of consulting service fees during the project operation period.
3. Sub-lease services
The owner leases the retail commercial properties as a whole to the Group at a certain price, and all income and costs of project operation are borne by the Group.
The Group charges tenants and consumers: (i) rental income of projects; (ii) operation and management service fees during project operation; (iii) income from diversified operations; and (iv) parking fees.
Residential property management services: The Group provided property management services for residential properties, office buildings and service apartments.
It primarily included:
(i) Pre-sale management services to property developers during their pre-sale activities, such as cleaning, security and maintenance of pre-sale display units and sales offices;
(ii) Property management services to property owners or property owners' associations at the post-delivery stages, such as security, cleaning, gardening and repair and maintenance services; and
(iii) Other value-added services to property owners, tenants or residents of properties under management, such as pre-delivery preparation and trash handling service, common area, advertising space and car park management services.
The table below sets forth the Company's gross profit and gross profit margin by business segment for the years indicated:
Year ended 31 December 2020 2019
Gross
Gross profit RMBprofit margin %Gross profit RMBGross profit margin %
(in thousands, except for percentages)
Commercial operational services Residential property management services
511,921 82,625
32.8
391,563 29.3
23.1
36,844 12.9
Total
594,546
30.9
428,407 26.4
COMMERCIAL OPERATIONAL MANAGEMENT SERVICES
The Group primarily provided professional commercial operational management services to property owners, tenants and consumers under four brands, namely, "Powerlong One Mall" (ᘒ Ꮂɓ۬), "Powerlong City" (ᘒᎲ۬), "Powerlong Plaza" (ᘒᎲᄿఙ) and "Powerlong Land"
(ᘒᎲ˂ή).
For the year ended 31 December 2020, the aggregate revenue of the Group's commercial operational management services amounted to approximately RMB1,562.9 million, representing an increase of 17.1% from approximately RMB1,335.1 million for the year ended 31 December 2019; and the Group had GFA in operation of 8.6 million sq.m., representing an increase of 1.6 million sq.m. from 7.0 million sq.m. for the corresponding period of 2019; 68 projects in operation, representing an increase of 17 projects from 51 projects for the corresponding period of 2019; contracted GFA of 11.3 million sq.m., representing an increase of 2.4 million sq.m. from 8.9 million sq.m. for the corresponding period of 2019.
The table below sets forth a breakdown of the aggregate GFA in operation as at the dates indicated and the revenue from commercial operational service segment for the years indicated by geographic region:
As of/For the year ended 31 December
2020
Contracted
GFA sq.m.
GFA in operation sq.m.
Yangtze River Delta(1)
Pearl River Delta (2)
Others(3)
7,269 316 3,763
5,033 - 3,540
Total
11,348
8,573 1,562,925 8,867
1,059,868 6,604
2019 | ||
Contracted | GFA in | |
Revenue GFA | operation | Revenue |
RMB sq.m. | sq.m. | RMB |
(in thousands) | ||
3,647 | 900,027 | |
- | - | |
3,335 | 435,082 | |
6,982 | 1,335,109 |
5,232 -
496,453 3,635
Notes:
(1) Comprises Shanghai Municipality, Zhejiang Province, Jiangsu Province and Anhui Province.
(2) Comprises Guangdong Province.
(3) Comprises cities except those mentioned in (1) and (2) above.
First Acquisition under the Strategy of Focused Development in the Yangtze River Delta
On 6 July 2020, the Company announced that the Group had entered into an investment agreement (the "Investment Agreement") with a shareholder of Zhejiang Xinghui Commercial Management Company Limited (एϪිਠุ၍ଣϞࠢʮ̡) ("Zhejiang Xinghui"), an independent third party, on 3 July 2020. Pursuant to which the Group acquired 60% equity interest in Zhejiang Xinghui with an investment cost of RMB40.6 million. Zhejiang Xinghui is principally engaged in retail commercial property operation and management. As of the date of this announcement, Zhejiang Xinghui had 15 retail commercial property projects under management, with a total GFA of approximately 0.86 million square meters, including 8 opened retail commercial property projects and 7 pipeline retail commercial property projects.
Further, Zhejiang Xinghui undertake to the Group that the annual net profit excluding extraordinary profit or loss attributable to the parent company in the following years will be not less than RMB6.0 million for 2020, RMB7.7 million for 2021, RMB9.8 million for 2022, RMB12.6 million for 2023 and RMB16.1 million for 2024. The financial results of Zhejiang Xinghui has been consolidated into the Group's financial statement since 1 September 2020.
In line with the Group's plan to reinforce its leading position in the retail commercial property operation and management field by, among others, further expansion of its commercial operational service segment through strategic acquisitions and investments, the Company has selectively evaluated opportunities with a focus on cities located in economically developed region where there exist significant growth potential. The Zhejiang Xinghui is deemed an ideal acquisition target to achieve the Company's aforementioned goals for the following reasons: Firstly, the management of the Zhejiang Xinghui has extensive experience in operation and management of retail commercial properties and outstanding past performance. Secondly, the Zhejiang Xinghui is located in Zhejiang province, which is consistent with the Group's general strategy to further develop, expand and strengthen its business in the Yangtze River Delta region. Thirdly, the urban locations of the Zhejiang Xinghui's projects under management and the projects itself has rooms for enhancement, which the Group believes to raise profit levels thereafter by leveraging its resources. Fourthly, after the completion of the Acquisition, the Zhejiang Xinghui would be able to accelerate its expansions in the Zhejiang region and gain additional management projects by virtue of the Group's brand influence. Fifthly, the consideration of the Acquisition is reasonable. Upon the completion of the Acquisition, the Group would continue to expand its business by leveraging the existing team of the Zhejiang Xinghui and would also consolidate the financial results of the Zhejiang Xinghui to the Group's financial statements, resulting in a win-win to both the Group and the Zhejiang Xinghui.
For further details on the Investment Agreement, please refer to the announcement of the Company dated 6 July 2020.
Projects in Operation
New retail commercial property projects added to the Group's portfolio upon opening for the year ended 31 December 2020 are shown in the following table:
No.
Name of Project
Powerlong Plaza
1 Hangzhou Qingshan Lake
Powerlong Plaza (Phase 1)
( ψڡʆಳᘒᎲᄿఙ€ɓಂ)
2 Yongkang Powerlong Plaza
( ͑ੰᘒᎲᄿఙ)
3 Hangzhou Dajiangdong
Powerlong Plaza
( ψɽϪ؇ᘒᎲᄿఙ)
4 Shaoxing Keqiao Powerlong Plaza
( ୗጳݚᘒᎲᄿఙ)
5 Suzhou Xingyun Powerlong Plaza
( ᘽψᗲᘒᎲᄿఙ)
6 Yancheng Chengdong
Powerlong Plaza
( ۬۬؇ᘒᎲᄿఙ)
7 Quanzhou Taishang Powerlong Plaza
( ݰψ̨ਠᘒᎲᄿఙ)
8 Zhangzhou Longwen Powerlong Plaza
( ငψᎲ˖ᘒᎲᄿఙ)
9 Hangzhou Qingshan Lake
Powerlong Plaza (Phase 2)
( ψڡʆಳᘒᎲᄿఙ€ɚಂ)
Opening date month-yearCityGeographic regionOwnerManagement Model
Total GFA (sq.m)
Shopping
Mall (sq.m)
Commercial
Street (sq.m)
Car Park (sq.m)
October 2020
HangzhouYangtze River
DeltaPowerlong
Real EstateEntrusted management
189,524
98,000 - 91,524
November 2020
JinhuaYangtze RiverNovember 2020
PowerlongHangzhouEntrusted management Entrusted management
89,900
62,900 - 27,000
Delta Yangtze River
Real Estate Powerlong
95,373
62,373 - 33,000
Delta
Real EstateNovember 2020
ShaoxingYangtze RiverDecember 2020
Third PartySublease
99,787
54,787 - 45,000
Suzhou
Delta Yangtze RiverThird PartySublease
40,774
40,774
-
-
December 2020
Yancheng
Delta Yangtze RiverPowerlong
DeltaEntrusted management
135,932
76,927 - 59,004
Real EstateDecember 2020
QuanzhouOthers
PowerlongDecember 2020
Entrusted management Entrusted management Sublease
148,950
106,060 - 42,890
Zhangzhou Others
Real Estate Powerlong
66,186
46,604
2,347 17,234
December 2020
HangzhouYangtze River
Delta
Real Estate Third Party
110,000
53,000
- 57,000
Total
976,426
601,426
2,347 372,653
The Group's retail commercial property projects in operation for the year ended 31 December 2020 are shown in the following table:
No.
Geographic regionManagement ModelShoppingName of Project
Powerlong One Mall
1
Xiamen Powerlong One Mall
(ขژᘒᎲɓ۬)
Opening date month-yearCity
September 2018 Xiamen
CommercialOwner
Total GFA
Mall (sq.m)
Street (sq.m)
Car Park
(sq.m)
(sq.m)
Others
Powerlong
Real EstateEntrusted management
170,585
121,670
5,365 43,550
Sub-total
Powerlong City
1 Shanghai Qibao Powerlong Plaza
(ɪऎɖᘒᘒᎲ۬)
2 Hangzhou Binjiang Powerlong City
(ψᏵϪᘒᎲ۬)
170,585
121,670
5,365 43,550
October 2016
December 2016
ShanghaiHangzhouYangtze River
Delta Yangtze River
DeltaPowerlong
Real Estate Powerlong
Real EstateEntrusted management Entrusted management
150,567
70,719
12,759 67,089
295,562
140,877
37,512 117,173
Sub-total
446,129
211,596
50,271 184,262
Powerlong Plaza
1 Fuzhou Powerlong Plaza
(၅ψᘒᎲᄿఙ)
2 Qingdao Chengyang Powerlong Plaza
(ڡࢥ۬ජᘒᎲᄿఙ)
3 Zhengzhou Powerlong Plaza
(ቍψᘒᎲᄿఙ)
4 Bengbu Powerlong Plaza
(ᘒᎲᄿఙ)
5 Wuxi Powerlong Plaza
(ೌ፼ᘒᎲᄿఙ)
6 Anxi Powerlong Plaza
(τᘒᎲᄿఙ)
7 Suqian Powerlong Plaza
(ቋᘒᎲᄿఙ)
8 Yancheng Powerlong Plaza
(۬ᘒᎲᄿఙ)
9 Qingdao Licang Powerlong Plaza
(ڡࢥҽᘒᎲᄿఙ)
10 Qingdao Jimo Powerlong Plaza
(ڡࢥуኈᘒᎲᄿఙ)
11 Luoyang Powerlong Plaza
(ݾජᘒᎲᄿఙ)
12 Tai'an Powerlong Plaza
(इτᘒᎲᄿఙ)
13 Xinxiang Powerlong Plaza
(อඊᘒᎲᄿఙ)
14 Shanghai Caolu Powerlong Plaza
(ɪऎ༩ᘒᎲᄿఙ)
15 Jinjiang Powerlong Plaza
(ࣜϪᘒᎲᄿఙ)
16 Hangzhou Xiasha Powerlong Plaza
(ψɨӍᘒᎲᄿఙ)
17 Chongqing Hechuan Powerlong Plaza
(ࠠᅅΥʇᘒᎲᄿఙ)
18 Tianjin Yujiapu Powerlong Plaza
(˂ݵɲఝᘒᎲᄿఙ)(1)
19 Jiaozhou Powerlong Plaza
(ᇭψᘒᎲᄿఙ)
20 Zhenjiang Powerlong Plaza
(ᕄϪᘒᎲᄿఙ)
21 Shanghai Fengxian Powerlong Plaza
(ɪऎւሬᘒᎲᄿఙ)
22 Shanghai Lingang Powerlong Plaza
(ɪऎᑗಥᘒᎲᄿఙ)
23 Hangzhou Xiaoshan Powerlong Plaza
(ψጽʆᘒᎲᄿఙ)
24 Shanghai Luodian Powerlong Plaza
(ɪऎᖯֳᘒᎲᄿఙ)
25 Hangzhou Fuyang Powerlong Plaza
(ψబජᘒᎲᄿఙ)
26 Changzhou Powerlong Plaza
(੬ψᘒᎲᄿఙ)
27 Shanghai Jiading Powerlong Plaza
(ɪऎྗ֛ᘒᎲᄿఙ)
28 Penglai Powerlong Plaza
(ᇻഺᘒᎲᄿఙ)
April 2007
FuzhouOctober 2009
QingdaoDecember 2009
Zhengzhou OthersDecember 2009
BengbuOctober 2010
WuxiDecember 2010
QuanzhouSeptember 2011 SuqianSeptember 2011 YanchengDecember 2011
QingdaoDecember 2011
QingdaoDecember 2011
LuoyangSeptember 2012 Tai'anSeptember 2012 XinxiangDecember 2013
ShanghaiDecember 2013
JinjiangNovember 2014
HangzhouDecember 2014
Chongqing OthersDecember 2014
TianjinFebruary 2015
QingdaoSeptember 2015 ZhenjiangNovember 2015
December 2015
December 2015
December 2015
December 2015
June 2016
OthersOthersYangtze River
Delta Yangtze River
Delta OthersYangtze River
Delta Yangtze River
Delta OthersOthersOthersOthersOthersYangtze River
Delta OthersYangtze River
DeltaOthersOthersYangtze RiverShanghai
Delta Yangtze RiverShanghai
Delta Yangtze RiverHangzhou
Delta Yangtze RiverShanghai
Delta Yangtze RiverHangzhou
Delta Yangtze River
DeltaChangzhou Yangtze River
DeltaOctober 2016
November 2016
YantaiShanghaiYangtze River
Delta OthersPowerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real EstateEntrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management
(1) Tianjin Yujiapu Powerlong Plaza has reopened in December 2020.
186,178
161,008 - 25,170
443,262
335,506 - 107,756
235,606
198,108
6,565 30,933
346,880
222,966
48,503 75,411
192,865
142,753
- 50,112
85,374
55,489
28,034 1,851
150,660
120,645
- 30,015
199,409
135,112
29,720 34,577
174,167
110,949 - 63,218
175,513
130,462 - 45,051
138,350
69,735
37,225 31,390
118,255
102,677
- 15,578
205,171
90,321
65,729 49,122
81,720
57,200
- 24,520
283,378
128,570
11,126 143,682
98,660
15,575
10,323 72,762
147,403
103,793 - 43,610
162,836
87,613 - 75,223
164,772
75,224
27,002 62,546
153,818
70,170
32,797 50,851
117,715
49,816
14,847 53,053
70,720
40,069
9,931 20,719
143,836
68,687
12,217 62,932
35,854
28,481
- 7,373
77,186
21,728
10,741 44,718
170,134
105,598
15,814 48,722
144,072
64,054
24,902 55,115
148,213
43,431
59,871 44,911
29 Yantai Powerlong Plaza
(ၽᘒᎲᄿఙ)
30 Yangzhou Powerlong Plaza
(౮ψᘒᎲᄿఙ)
31 Shanghai Wujing Powerlong Plaza
(ɪऎюऋᘒᎲᄿఙ)
32 Yiwu Fotang Powerlong Plaza
(່ढНੀᘒᎲᄿఙ)
33 Fuyang Powerlong Plaza
(ڙජᘒᎲᄿఙ)
34 Chongqing Fuling Powerlong Plaza
(ࠠᅅᘒᎲᄿఙ)
35 Shanghai Qingpu Powerlong Plaza
(ɪऎڡऌᘒᎲᄿఙ)
36 Jiangyou Powerlong Plaza
(ϪذᘒᎲᄿఙ)
37 Shaoxing Paojiang Powerlong Plaza
(ୗጳசϪᘒᎲᄿఙ)
38 Hangzhou Lin'an Powerlong Plaza
(ψᑗτᘒᎲᄿఙ)
39 Tianjin Binhai Powerlong Plaza
(˂ݵᏵऎᘒᎲᄿఙ)
40 Shanghai Baoyang Powerlong Plaza
(ɪऎᘒเᘒᎲᄿఙ)
41 Nanjing Gaochun Powerlong Plaza
(یԯ৷૮ᘒᎲᄿఙ)
42 Ningbo Yinzhou Powerlong Plaza
(ྐྵتψᘒᎲᄿఙ)
43 Hangzhou Qingshan Lake
Powerlong Plaza (Phase 1)
(ψڡʆಳᘒᎲᄿఙ€ɓಂ)
44 Yongkang Powerlong Plaza
(͑ੰᘒᎲᄿఙ)
45 Hangzhou Dajiangdong Powerlong Plaza
(ψɽϪ؇ᘒᎲᄿఙ)
46 Shaoxing Keqiao Powerlong Plaza
(ୗጳݚᘒᎲᄿఙ)
47 Suzhou Xingyun Powerlong Plaza
(ᘽψᗲᘒᎲᄿఙ)
48 Yancheng Chengdong Powerlong Plaza
(۬۬؇ᘒᎲᄿఙ)
49 Quanzhou Taishang Powerlong Plaza
(ݰψ̨ਠᘒᎲᄿఙ)
50 Zhangzhou Longwen Powerlong Plaza
(ငψᎲ˖ᘒᎲᄿఙ)
51 Hangzhou Qingshan Lake
Powerlong Plaza (Phase 2)
(ψڡʆಳᘒᎲᄿఙ€ɚಂ)
December 2016
YantaiJanuary 2017
YangzhouJuly 2017
ShanghaiNovember 2017
YiwuDecember 2017
FuyangDecember 2017
Chongqing OthersSeptember 2018 ShanghaiNovember 2018
JiangyouSeptember 2019 ShaoxingDecember 2019
December 2019
December 2019
December 2019
October 2020
November 2019
TianjinShanghaiNanjingNingboHangzhouHangzhouOthers
Delta OthersYangtze River
Delta Yangtze River
Delta Yangtze River
Delta Yangtze RiverYangtze River
Delta Yangtze River
Delta Yangtze River
Delta Yangtze RiverYangtze River
Delta
Delta OthersYangtze River
Delta Yangtze River
Delta
Real Estate Powerlong
Real Estate PowerlongPowerlongPowerlong
Real Estate Third Party
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate PowerlongPowerlong
Real Estate Third PartyPowerlong
Real Estate Third Party
Real Estate Powerlong
Real EstateEntrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management Entrusted management
100,027
37,869
20,629 41,530
143,559
58,407
30,252 54,900
45,017
26,794
6,436 11,787
90,992
50,000
15,992 25,000
140,441
103,890 - 36,551
113,854
96,204 - 17,650
171,673
54,281
38,461 78,930
91,342
72,590 - 18,752
41,083
30,000 - 11,083
103,700
55,700 - 48,000
61,883
36,400
6,100 19,383
148,407
77,873
15,155 55,379
87,542
56,200
17,000 14,342
93,924
63,596 - 30,328
189,524
98,000 - 91,524
November 2020
November 2020
November 2020
JinhuaHangzhouShaoxing
Delta Yangtze River
Delta Yangtze RiverYangtze RiverPowerlong
Real Estate Powerlong
Real Estate Third PartyEntrusted management Entrusted management Sublease
89,900
62,900 - 27,000
95,373
62,373 - 33,000
Delta Yangtze River
99,787
54,787 - 45,000
December 2020
Suzhou
Third PartySublease
Delta Yangtze River
40,774
40,774
-
-
December 2020
December 2020
December 2020
December 2020
Zhangzhou OthersHangzhouYanchengQuanzhouYangtze River
Delta Others
Real Estate Third Party
Real Estate PowerlongPowerlong
Real Estate PowerlongEntrusted management Entrusted management Entrusted management Sublease
135,932
76,927 - 59,004
148,950
106,060 - 42,890
66,186
46,604
2,347 17,234
Delta
110,000
53,000
- 57,000
Sub-total
7,061,877
4,256,970
597,719
2,207,188
Powerlong Land
1 Taicang Powerlong Land
(˄ࡑᘒᎲ˂ή)
2 Hangzhou Xiasha Powerlong Land
(ψɨӍᘒᎲ˂ή)
3 Shanghai Huaxin Powerlong Land
(ɪऎശอᘒᎲ˂ή)
4 Dongying Powerlong Land
(؇ᐄᘒᎲ˂ή)
5 Haiyang Powerlong Land
(ऎජᘒᎲ˂ή)
6 Huai'an Powerlong Land
(ଊτᘒᎲ˂ή)
March 2007
SuzhouNovember 2014
HangzhouDecember 2015
ShanghaiSeptember 2016 Dongying
Delta Yangtze RiverYangtze RiverPowerlong
Real Estate Third PartyEntrusted management Sublease
25,476
-
25,476
-
Delta Yangtze River
39,039
-
28,839 10,200
June 2017
July 2017
YantaiHuai'an
Delta OthersOthersYangtze River
DeltaPowerlong
Real Estate Powerlong
Real Estate Powerlong
Real Estate Powerlong
Real EstateEntrusted management Entrusted management Entrusted management Entrusted management
51,113
-
24,447 26,666
79,514
-
51,649 27,865
39,108
-
37,470 1,638
93,384
-
82,827 10,558
Sub-total
Powerlong Xinghui
1 Jiashan Xingyuecheng
(ྗഛࣀ۬)
2 Ningbo Xingjiefang
(ྐྵتѥ)
3 Xingyue • Xicheng Plaza
(ࣀ•Г۬ᄿఙ)
4 Ningbo Hongtai Plaza
(ྐྵت҃इᄿఙ)
5 Jinsha Pier Aolai Park
(ږӍᇁ᎘ෳഺʮ)
6 Anji • Henglong Dadao
(τΛ•㛬ඤɽ༸)
7 Xingyue • Xiuhuli
(ࣀ•ᔐಳԢ)
8 Ningbo Zhongticheng
(ྐྵتʕ۬)
October 2014
JiaxingDecember 2016
NingboOctober 2017
TaizhouFebruary 2018
NingboApril 2018
NingboSeptember 2018 Huzhou
327,634
-
250,708 76,926
Yangtze RiverThird PartySublease
Delta Yangtze River
35,000
35,000
-
-
Delta Yangtze RiverThird PartyThird PartyAdvisory consultation Sublease
53,292
-
25,789 27,503
Delta Yangtze River
38,100
33,000 - 5,100
June 2019
May 2019
NingboYiwu
Delta Yangtze River
Delta Yangtze River
Delta Yangtze River
Delta Yangtze River
Delta
Third PartyThird PartyThird PartyThird PartyThird PartyAdvisory consultation Advisory consultation Advisory consultation Advisory consultation Advisory consultation
99,835
99,835
-
-
133,970
87,258
13,288 33,424
54,873
-
39,873 15,000
63,000
48,000 - 15,000
88,305
54,137 - 34,168
Sub-total
566,375
357,230
78,950 130,195
Total
8,572,600
4,947,466
983,013 2,642,121
The table below sets forth average occupancy rate and GFA in operation of retail commercial property that commenced operation as at 31 December 2020 by brands.
Average occupancy rate(1)
As of 31 December
GFA in
Product category | 2020(2) | 2019 | operation |
% | % | (000' sq. m.) | |
Powerlong One Mall (ᘒᎲɓ۬) | 96.5 | 95.2 | 171 |
Powerlong City (ᘒᎲ۬) | 91.6 | 91.3 | 446 |
Powerlong Plaza (ᘒᎲᄿఙ) | 89.9 | 89.0 | 7,062 |
Powerlong Land (ᘒᎲ˂ή) | 87.5 | 90.1 | 328 |
Powerlong Xinghui (ᘒᎲි) | 88.1 | N/A(3) | 566 |
Total | 89.9 | 89.4 | 8,573 |
(1) Occupancy rate is calculated as actual leased area divided by available lease area of a retail commercial property as of the end of each relevant period based on internal record. The occupancy rate only applies to retail commercial properties for which the Group has provided tenant sourcing services and may be higher or lower in different periods within one year.
(2) The statistics of occupancy rate in 2020 excludes Haiyang Powerlong Land and Dongying Powerlong Land.
• Haiyang Powerlong Land was at the preparation stage, for which we have not yet provided any business tenancy services;
• The property developer of Dongying Powerlong Land was in the process of assigning the units within the shopping streets to members of village collective economic organization, and the Group only provided limited management services.
(3) The Group entered into an Investment Agreement with Zhejiang Xinghui, an independent third party, on 3 July 2020, to which the statistics of occupancy rate in 2019 did not apply.
Pipeline Projects
Retail commercial property projects planning for opening in 2021 are as follows:
No.
Name of Project
Powerlong Plaza
1 Wenling Powerlong Plaza
(ᏊᘒᎲᄿఙ)
2 Zhuji Powerlong Plaza
(መᘒᎲᄿఙ)
3 Zhoushan Powerlong Plaza
(ЋʆᘒᎲᄿఙ)
4 Ningbo Gaoxin Powerlong Plaza
(ྐྵت৷อᘒᎲᄿఙ)
5 Yancheng Jianhu Powerlong Plaza
(۬ܔಳᘒᎲᄿఙ)
6 Wenzhou Konggang Powerlong Plaza
(ψ٤ಥᘒᎲᄿఙ)
7 Ningbo Fenghua Powerlong Plaza
(ྐྵتւʷᘒᎲᄿఙ)
8 Yuyao Powerlong Plaza
(ЯۼᘒᎲᄿఙ)
9 Yiwu Qingkou Powerlong Plaza
(່ढڡɹᘒᎲᄿఙ)
10 Zhuhai Gaoxin Powerlong Plaza
(मऎ৷อᘒᎲᄿఙ)
11 Lanxi Powerlong Plaza
(ᚆᘒᎲᄿఙ)
12 Huizhou Rongcan Powerlong Plaza
(ψᐆᘒᎲᄿఙ)
13 Hangzhou Jinnan Powerlong Plaza
(ψᎀیᘒᎲᄿఙ)
Opening date(1) month-yearCityGeographic region
September 2021
TaizhouYangtze River DeltaSeptember 2021
ShaoxingYangtze River DeltaSeptember 2021
ZhoushanYangtze River DeltaSeptember 2021
NingboYangtze River DeltaSeptember 2021
YanchengYangtze River DeltaSeptember 2021
WenzhouYangtze River DeltaSeptember 2021
NingboYangtze River DeltaDecember 2021
NingboYangtze River DeltaDecember 2021
JinhuaYangtze River DeltaDecember 2021
ManagementOwnerExpectedModel
GFA (sq.m)
Powerlong Real Estate Powerlong Real Estate Powerlong Real Estate Powerlong Real Estate Third PartyEntrusted 108,065 management
Entrusted 138,600 management
Entrusted 107,720 management
Entrusted 143,588 management
Entrusted 96,182 management
Powerlong Real Estate Powerlong Real Estate Powerlong Real Estate Powerlong Real Estate Powerlong Real Estate Powerlong Real Estate Third Party
Entrusted 47,000 management
Entrusted 71,300 management
Entrusted 65,915 management
Entrusted 74,087 management
ZhuhaiPearl River DeltaDecember 2021
JinhuaYangtze River DeltaDecember 2021
Entrusted 115,513 management
Entrusted 142,900 management
HuizhouPearl River DeltaDecember 2021
HangzhouYangtze River Delta
Entrusted 50,600 management
Powerlong Real Estate
Entrusted 45,772 management
Sub-total
1,207,242
Management ModelExpectedNo.
Name of Project
Powerlong Land
1 Zhoushan Dinghai Powerlong Land
(Ћʆ֛ऎᘒᎲ˂ή)
2 Jinhua Pan'an Powerlong Land
(ږശᇂτᘒᎲ˂ή)
3 Shanghai Jiading Powerlong Land
(ɪऎྗ֛ᘒᎲ˂ή)
Opening date(1) month-yearCityGeographic region
September 2021
ZhoushanYangtze River DeltaSeptember 2021
JinhuaYangtze River DeltaDecember 2021
ShanghaiYangtze River Delta
Owner
GFA (sq.m)
Powerlong Real Estate Powerlong Real Estate Powerlong Real EstateEntrusted 28,100 management
Advisory 43,400 consultation
Entrusted 21,600 management
Sub-total 93,100
Powerlong Xinghui
1 Anji Tsinghua Yuan
(τΛശ)
2 Ningbo Cicheng
(ྐྵتฉ۬)
3 Huasun • Yinghuali
(ശ᳅•ᙶڀԢ)
4 Dongcheng Times Commercial Centre
(؇۬ࣛ˾ਠุʕː)
5 Shangyu Jiayuan Plaza
(ɪԳ๕ᄿఙ)
6 Xingyue • PARK
(ࣀ•PARK)
September 2021
HuzhouYangtze River DeltaSeptember 2021
NingboYangtze River DeltaSeptember 2021
NingboYangtze River DeltaSeptember 2021
HuzhouYangtze River DeltaDecember 2021
ShaoxingYangtze River DeltaDecember 2021
NingboYangtze River DeltaThird PartyAdvisory 14,000 consultation
Third Party
Advisory 29,000 consultation
Third Party
Advisory 42,492 consultation
Third Party
Advisory 42,382 consultation
Third Party
Advisory 105,216 consultation
Third Party
Advisory 4,314 consultation
Sub-total 237,404
Total
1,537,746
(1) Opening dates of all the projects are estimated dates. Actual opening dates are subject to project progress.
Retail commercial property projects planning for opening in and after 2022 are as follows:
No.
Name of Project
1
Ningbo Powerlong One Mall
(ྐྵتᘒᎲɓ۬)
2
Taizhou Jiaojiang Powerlong City
(̨ψಕϪᘒᎲ۬)
3
Linhai Powerlong Plaza
(ᑗऎᘒᎲᄿఙ)
4
Hangzhou Tech City Powerlong Plaza
(ψ߅Ҧ۬ᘒᎲᄿఙ)
5
Hangzhou Gongshu Powerlong Plaza
(ψܹྨᘒᎲᄿఙ)
6
Zhuhai Jinwan Powerlong Plaza
(मऎږᝄᘒᎲᄿఙ)
7
Nanjing Jiangning Powerlong Plaza
(یԯϪྐྵᘒᎲᄿఙ)
8
Jingdezhen Powerlong Plaza
(౻ᅃᕄᘒᎲᄿఙ)
9
Chongqing Wanzhou Powerlong Plaza
(ࠠᅅຬψᘒᎲᄿఙ)
10 Jinhua Jinyi Powerlong Plaza
(ږശږ່ᘒᎲᄿఙ)
11 Zhuhaibei Railway Station Powerlong Plaza
(मऎ̏१ᘒᎲᄿఙ)
12 Taizhou Luqiao Powerlong Land
(̨ψ༩ᘒᎲ˂ή)
13 Fuding Powerlong Land
(၅ཻᘒᎲ˂ή)
14 Jiaozhou Powerlong Land
(ᇭψᘒᎲ˂ή)
15 Wenzhou Leqing Powerlong Plaza
(ψᆀᘒᎲᄿఙ)
CityGeographic regionManagement ModeExpectedOwner
NingboYangtze River DeltaPowerlong Real EstateTaizhouYangtze River DeltaPowerlong Real EstateTaizhouYangtze River DeltaThird PartyHangzhouYangtze River DeltaPowerlong Real EstateHangzhouYangtze River DeltaPowerlong Real EstateZhuhaiPearl River Delta
Powerlong Real EstateNanjingYangtze River DeltaPowerlong Real EstateJingdezhenOthers
Powerlong Real EstateChongqingOthers
Third Party
Jinhua
Yangtze River DeltaPowerlong Real Estate
ZhuhaiPearl River Delta
Powerlong Real Estate
TaizhouYangtze River DeltaPowerlong Real Estate
Fuding
Others
Powerlong Real Estate
Qingdao
Others
Powerlong Real Estate
GFA (sq.m)
Entrusted management 190,100
Entrusted management 149,517
Sublease 50,215
Entrusted management 95,800
Entrusted management 98,264
Entrusted management 70,000
Entrusted management 78,400
Entrusted management 110,000
Entrusted management 80,000
Entrusted management 90,000
Entrusted management 80,000
Advisory consultation 56,321
Advisory consultation 9,411
Entrusted management 23,415
Wenzhou
Yangtze River DeltaThird Party
Advisory consultation 56,000
Total
1,237,443
Progress of "New Commerce Plan"
After the commencement of strategic cooperation between the Company and Tencent in 2019 in the formation of a joint venture, Shanghai Baoshen Digital Technology Co., Ltd. (ɪऎᘒ͡ᅰο߅ҦϞࠢʮ̡), and by catering commercial operating demands centered at the construction of digitalization of "people, products and venue" through technological capabilities of Tencent including cloud computing, Wechat Pay, mini programs, AI, location-based services and IOT, the Company has been developing relevant online products in terms of four aspects, namely consumers, operators, managers and intelligent hardware, and has initially achieved data interoperability.
1. Consumer products
Optimize the membership system of "Powerlong Yoyo" by introducing a new loyalty point system to enrich membership benefits and implement membership caring scheme. The system has been launched gradually in 50 Powerlong Plazas during the year ended 31 December 2020 and gained over 1.5 million new members with a significant increase in active rate and consumption rate of members. During the epidemic, a livestreaming shopping function "Yoxiu" was introduced to help tenants in attracting online shopping. There were in total over 30 livestreaming in 6 pilot plazas with an accumulated sales of about RMB10,000,000. At Bingjiang Project, sales of over RMB0.7 million in one livestreaming was achieved by one single tenant.
2. Operator products
During the year ended 31 December 2020, the Wechat-based mini program, "Mall Plus@Powerlong" tailor-made for tenants was launched in about 50 Powerlong Plazas across the country. The program mainly provides online services function for tenants at the present, including daily affairs such as online repairing request, online payment enquiries, online electronic invoice issuance and tenants' complaints. While providing great convenience to tenants, the management efficiency of commercial companies is also enhanced.
3. Manager products
In 2020, Powerlong Commercial Management System ("PMS") was upgraded. By unifying the back-end developing philosophy, back-end programs of "Powerlong Yoyo" and "Mall Plus@Powerlong" were integrated into the application of the management-end, which achieved initial data interoperability among people, products and venue. Mobile application version and WeCom version were also launched at the same time, which achieved mobile management and enhanced working efficiency greatly.
Moreover, digitalized tenant sourcing platforms for 11 projects were developed and launched based on Tencent Raydata big data visualization interactive system and 3D rendering technology. Projects and data visualization is achieved, which enables mobile tenant sourcing for tenant sourcing personnel.
4. Intelligent hardware products
During the year ended 31 December 2020, the Company tested "Multi-functional precision consumer traffic monitoring system" in 3 Powerlong Plazas to gain an insight into the whereabouts of consumers inside the malls with the assistance of Tencent's face recognition technology which enables precise identification of consumers' portraits. The redefinition of membership labels and precise portraits of members has enabled the Company to start exploring precise marketing.
RESIDENTIAL PROPERTY MANAGEMENT SERVICES
For the year ended 31 December 2020, the total revenue of the Group's residential property management service business segment amounted to approximately RMB358.3 million, representing an increase of 25.6% from RMB285.3 million for the year ended 31 December 2019; and the Group had GFA delivered of 14.4 million sq.m., representing an increase of 2.9 million sq.m. from 11.5 million sq.m. for the corresponding period of 2019; 61 delivered projects, representing an increase of 10 projects from 51 projects for the corresponding period of 2019; contracted GFA of 23.2 million sq.m., representing an increase of 3.7 million sq.m. from 19.5 million sq.m. for the corresponding period of 2019.
The table below sets forth a breakdown of the aggregate GFA delivered as at the dates indicated and our revenue from residential property management service segment for the years indicated by geographic region:
As of/For the year ended 31 December
2020
Contracted
GFA sq.m.
GFA delivered sq.m.
Yangtze River Delta(1)
Pearl River Delta (2)
Others(3)
13,393 338 9,485
6,136 - 8,264
Total
23,216
14,400
2019 | ||
Contracted | GFA | |
Revenue GFA | delivered | Revenue |
RMB sq.m. | sq.m. | RMB |
(in thousands) | ||
5,693 | 156,986 | |
- | - | |
5,813 | 128,362 | |
11,506 | 285,348 |
10,702 -
197,977 21
160,315 8,829
358,313 19,531
Notes:
(1) Comprises Shanghai Municipality, Zhejiang Province, Jiangsu Province and Anhui Province.
(2) Comprises Guangdong Province.
(3) Comprises cities except those mentioned in (1) and (2) above.
2021 WORK PLAN
In retrospect, the outbreak of the Coronavirus Disease 2019 (the "COVID-19") at the beginning of year 2020 has brought enormous impact on the industry. On a global basis, the PRC was the most rapid country to control the spread of the epidemic. Despite the spread of the COVID-19 around the globe, the Group is fully confident of the anti-epidemic measures adopted by the government of China and the country's leadership, and therefore optimistic about the situation in the PRC. Looking ahead to 2021, with the launch of the vaccination against coronavirus, the COVID-19 continued to be under good control in the PRC. We believe the overall industry environment in 2021 will be better than that of 2020. Meanwhile, the Company has formulated the 2021 Work Plan, which will be elaborated in the following two aspects.
1. Commercial Operational Management Services (I) Continuous growth in scale
The Group will continue to invest significant resources in Yangtze River Delta to further consolidate the Group's advantageous position in the region, especially in the five core cities of Shanghai, Hangzhou, Ningbo, Nanjing and Suzhou. In 2021, the Group has 23 projects planned for opening with an aggregate GFA of approximately 1,595,000 sq. m., among which 21 are located in the Yangtze River Delta region. While preparing for the opening of projects, the Group will continue to actively promote the asset-light business model to secure more retail commercial properties; the Group will also continue to actively seek acquisition targets including planning to acquire commercial management company(ies).
(II) Enhancement in management quality
In 2021, the Group will focus on enhancing the operation quality of projects in operation, adjusting the existing tenant mix, and increasing the overall occupancy rates of projects. At the same time, we will focus on a number of projects with potential and establish them as benchmarks of cities, which will further enhance the market image and influence of Powerlong products.
(III) Promotion of intelligent commerce
The Company will continue to concentrate on the core operational logic of the commercial "people, products and venue", with a focus on launching the "3+N" product R&D plan, i.e., the product R&D and application of 1 - member products, 2 - live broadcast products, 3 - new lease systems and N - intelligent hardware equipment. While building "people, products and venue", the Company realizes the unification of business flow, cash flow and data flow.
Consumer products - Having an accurate grasp of the members' information. Making full use of big data resources and technological means to gather data from members and unearth the members' value, thereby providing supreme experience and convenience to consumers.
Operator products - Establishing face-to-face connections for tenants and consumers. Fully optimizing the live broadcast products to transplant the live broadcast platform from "Powerlong Yoyo" end to "Mall Plus@Powerlong" end, which technologically realizes our product's capacity of simultaneous live streaming for nationwide projects and creates the Powerlong Live Broadcast Festival. For tenants, it is not only online servicing, but also online marketing.
Manager products - Increasing the managerial efficiency for enterprises. Full upgrade of the core modules for PMS - the lease system, thereby creating a new leasing platform fully connected with the "Mall Plus@Powerlong" data. This is a complete re-creation for business procedures to realize online leasing and mobile tenant sourcing, which greatly boosts our working efficiency as well as the quality of service delivery to our tenants.
Intelligent hardware products - Connecting the online and offline services. Continue to introduce the shared equipment to make our member products more interesting and strengthen the connection between online and offline products. Efforts are also made to identify application scenarios which are well developed with intelligent equipment, such as sweeping robots, thereby exploring the human-machine interactive management model and realizing costs reduction and efficiency improvement through technological applications.
(IV) Optimization of talent structure
In 2020, the Group adjusted and optimized its internal management structure, laying a solid talent foundation for rapid growth in the future. In 2021, the Group will continue to reserve and cultivate talents, gather elite talents, stimulate employees' potential through more competitive remuneration packages and incentivising policies, and build a first-class business operation team in the industry.
2. Residential Property Management Services
(I) Optimization of management system - Optimizing the operational systems for residential and commercial properties and office buildings to foster the implementation progress for the digitalization of property management;
(II) Improvement of business standards - Improving the "creating space full of love" service standard unique to Powerlong's properties to establish a brand image in the industry;
(III) Uplifting operation quality - Uplifting the operation and service quality for our projects to increase our customers' satisfaction; and
(IV) Enhancement of profitability - Enhancing the profitability of our commercial properties, office buildings and sales offices to explore other more income with our commercial advantages.
FINANCIAL REVIEW
Revenue
For the year ended 31 December 2020, due to the Group's ongoing business expansion, the Group recorded a revenue of approximately RMB1,921.2 million, representing an increase of approximately 18.6% as compared with approximately RMB1,620.5 million for the year ended 31 December 2019.
The Group's revenue indicated by business segment and type of service are as follows:
For the year ended 31 December
2020
2019
RMB'000
%
RMB'000
%
Commercial Operational Services
Market research and positioning, tenant sourcing and opening preparation services Commercial operation and management services Property leasing services
214,708 1,166,728 181,489
11.2% 60.7% 9.4%
143,231 8.8%
986,519 60.9%
205,359 12.7%
1,562,925
81.3% 1,335,109 82.4%Residential Property
Management Services Pre-sale management services Property management services Other value-added services
14,730 271,362 72,221
0.8% 14.1% 3.8%
13,128 0.8%
222,217 13.7%
50,003 3.1%Total
358,313 1,921,238
18.7%
285,348 17.6%
100% 1,620,457 100%
Market research and positioning, tenant sourcing and opening preparation services
The Group's market research and positioning, tenant sourcing and opening preparation services primarily include (i) market research and positioning services; and (ii) tenants sourcing and opening preparation services, provided to property developers or property owners before the opening of a retail commercial property.
For the year ended 31 December 2020, the Group's revenue from market research and positioning, tenant sourcing and opening preparation services amounted to approximately RMB214.7 million, representing a year-on-year increase of 49.9% and accounting for approximately 11.2% of the Group's total revenue.
The increase in the revenue from market research and positioning, tenant sourcing and opening preparation services was primarily due to the fact that the Group provided market research and positioning, tenant sourcing and opening preparation services with respect to 45 retail commercial properties for the year ended 31 December 2020, compared to 22 for the year ended 31 December 2019.
Commercial operation and management services
The Group's commercial operation and management services primarily include (i) retail commercial property management services; (ii) tenant management and rent collection services; and (iii) other value-added services, provided to property owners or tenants.
For the year ended 31 December 2020, the Group's revenue from commercial operation and management services amounted to approximately RMB1,166.7 million, representing a year-on-year increase of 18.3% and accounting for approximately 60.7% of the Group's total revenue.
The increase in the revenue from commercial operation and management services was primarily driven by the increase in the aggregate GFA in operation and increase in per-unit-GFA revenue as the existing retail commercial properties entered a maturity stage of operation. As at 31 December 2020, the Group's commercial properties GFA in operation was 8.6 million sq.m., representing a year-on-year increase of 22.8%.
Property leasing services
The Group provides property leasing services with respect to units located within the shopping streets and shopping malls. For the year ended 31 December 2020, the Group's revenue derived from property leasing services amounted to approximately RMB181.5 million, representing a year-on-year decrease of 11.6% and accounting for approximately 9.4% of total revenue.
The decrease in the revenue from property leasing services was primarily attributable to the normal maturity of a portion of lease contracts and the support of rent reduction provided to tenants in view of effects of the epidemic.
Residential Property Management Service
The Group's residential property management service primarily include (i) pre-sale management services to property developers during their pre-sale activities, such as cleaning, security and maintenance services for pre-sale display units and sales offices; (ii) property management services such as security, cleaning, gardening and repair and maintenance services to property owners or property owners' associations at the post-delivery stages; and (iii) other value-added services such as pre-delivery preparation and trash handling services, common area, advertising space and car park management services to property owners, tenants or residents of the Group's managed properties.
For the year ended 31 December 2020, the Group's revenue from residential property management services amounted to approximately RMB358.3 million, representing a year-on-year increase of 25.6% and accounting for approximately 18.7% of total revenue.
The increase in the revenue from residential property management service was primarily attributable to: (i) the increase in the residential properties GFA delivered to 14.4 million sq.m. for the year ended 31 December 2020, representing a year-on-year increase of 25.2%; (ii) the improvement of service quality and the increase in the number of contracts with residents, especially for other value-added services.
Revenue indicated by type of customers is as follows:
For the year ended 31 December
2020 | 2019 | |||
RMB'000 | % | RMB'000 | % | |
Commercial Operational Services | ||||
Fellow subsidiaries | 189,428 | 9.8% | 180,964 | 11.2% |
Other related parties | 77,314 | 4.0% | 21,429 | 1.3% |
External customers | 1,296,183 | 67.5% | 1,132,716 | 69.9% |
1,562,925 | 81.3% | 1,335,109 | 82.4% | |
Residential Property | ||||
Management Services | ||||
Fellow subsidiaries | 57,351 | 3.0% | 46,725 | 2.9% |
Other related parties | 4,831 | 0.3% | 1,345 | 0.1% |
External customers | 296,131 | 15.4% | 237,278 | 14.6% |
358,313 | 18.7% | 285,348 | 17.6% | |
Total | 1,921,238 | 100% | 1,620,457 | 100% |
Revenue derived from external customers represents the largest source of the Group's revenue. For the year ended 31 December 2020, revenue derived from external customers was approximately RMB1,592.3 million, representing 82.9% of the Group's total revenue.
Revenue indicated by geographic regions is as follows:
For the year ended 31 December
2020 | 2019 | |||
RMB'000 | % | RMB'000 | % | |
Commercial Operational Service | ||||
Yangtze River Delta | 1,059,868 | 55.2% | 900,027 | 55.6% |
Pearl River Delta | 6,604 | 0.3% | - | - |
Others | 496,453 | 25.8% | 435,082 | 26.8% |
1,562,925 | 81.3% | 1,335,109 | 82.4% | |
Residential Property | ||||
Management Service | ||||
Yangtze River Delta | 197,977 | 10.3% | 156,986 | 9.7% |
Pearl River Delta | 21 | 0.1% | - | - |
Others | 160,315 | 8.3% | 128,362 | 7.9% |
358,313 | 18.7% | 285,348 | 17.6% | |
Total | 1,921,238 | 100% | 1,620,457 | 100% |
For the year ended 31 December 2020, the Group's commercial operational properties and residential management properties were primarily located in the Yangtze River Delta.
Cost of services
The cost of services primarily include: (i) employee and other labour costs; (ii) depreciation expenses; (iii) utility expenses; (iv) variable lease payments; (v) short-term lease expenditure; (vi) taxes and other levies; and (vii) other miscellaneous costs.
For the year ended 31 December 2020, the Group's cost of services was approximately RMB1,326.7 million, representing a year-on-year increase of 11.3%. Such increase in cost of services was in line with the Group's business expansion.
Gross profit and gross profit margin
The gross profit of the Group for the year ended 31 December 2020 amounted to approximately RMB594.5 million, representing a year-on-year increase of 38.8%. For the year ended 31 December 2020, the gross profit margin was 30.9%, representing an increase of 4.5 percentage points as compared to 26.4% for the year ended 31 December 2019.
The gross profit of commercial operational services for the year ended 31 December 2020 amounted to approximately RMB511.9 million, representing a year-on-year increase of 30.7%. The gross profit margin of the Group's commercial operational services for the year ended 31 December 2020 was 32.8%, representing an increase of 3.5 percentage points as compared to 29.3% for the year ended 31 December 2019, primarily due to the business growth and excellent cost control of the Group.
The gross profit of residential property management services for the year ended 31 December 2020 amounted to approximately RMB82.6 million, representing a year-on-year increase of 124.3%. The gross profit margin of the Group's residential property management services for the year ended 31 December 2020 was 23.1%, representing an increase of 10.2 percentage points as compared to 12.9% for the year ended 31 December 2019, primarily due to the continued expansion of the residential property area delivered, the increase in the number of contracts with residents and the optimization of revenue structure, especially for the increase in other value-added services.
The Group's gross profit and gross profit margin by segment are as follows:
Year ended 31 December
2020 | 2019 | |||
Gross | Gross | |||
Gross | profit | Gross | profit | |
profit | margin | profit | margin | |
RMB'000 | % | RMB'000 | % | |
Commercial operational services | 511,921 | 32.8% | 391,563 | 29.3% |
Residential property | ||||
management services | 82,625 | 23.1% | 36,844 | 12.9% |
Total | 594,546 | 30.9% | 428,407 | 26.4% |
For the year ended 31 December 2020, the Group further fostered the project-regionalized integrated management. Meanwhile through technological upgrade and empowerment, the Group laid a sound foundation for increasing the gross profit of its business in future years.
Selling and marketing expenses
The Group's selling and marketing expenses mainly include promoting and advertising expenses.
For the year ended 31 December 2020, the selling and marketing expenses of the Group amounted to approximately RMB36.3 million, representing a year-on-year decrease of 13.2%.
This was mainly due to the reduced sales promotions affected by the epidemic.
Administrative expenses
For the year ended 31 December 2020, the Group's total administrative expenses amounted to approximately RMB134.4 million, including management fee of approximately RMB18.4 million incurred by share incentives. In 2019, the Group's total administrative expenses amounted to approximately RMB117.2 million, including listing expenses of approximately RMB29.4 million, representing a year-on-year increase of 32.1% in 2020 as compared to 2019 after deducting the listing expenses and management fee for share incentives. Such increase was mainly attributable to the expansion of business scale which led to an increase in the number of managerial staff and the average staff costs.
Other income and gains
Other income and gains were mainly the various subsidies income from local governments and the forfeited deposits from tenants due to their premature termination of contracts. For the year ended 31 December 2020, the Group's other income and gains amounted to approximately RMB32.6 million, representing a year-on-year increase of 88.6%. This was mainly due to the increase in government grants received during the year.
Net impairment losses on financial assets
The Group's net impairment losses on financial assets mainly include the allowance for impairment made in respect of operating lease and trade receivables and other receivables. For the year ended 31 December 2020, the Group's net impairment losses on financial assets amounted to approximately RMB22.8 million, representing a year-on-year increase of 215%. This was mainly due to the larger business scale and the increased provision made on the principle of prudency in view of the adverse effect of COVID-19 epidemic on some tenants' business operations.
Finance costs - net
The Group's net finance costs mainly include interest expense for bank borrowings, interest expense for lease liabilities and net interest income from bank deposits.
For the year ended 31 December 2020, the Group's net finance costs amounted to approximately RMB10.6 million, representing a year-on-year decrease of 66.8%. This was mainly due to the relatively substantial interest expenses on borrowings during the corresponding period in 2019.
Income tax expense
The Group's income tax expense mainly comprises PRC corporate income tax. For the year ended 31 December 2020, the effective income tax rates were 26.8%, representing a slight decrease by 1 percentage point as compared to 27.8% for the year ended 31 December 2019.
Profit for the year
For the year ended 31 December 2020, the Group's net profit was approximately RMB307.4 million. The net profit of the Group increased by approximately 72.1% as compared with the net profit of approximately RMB178.6 million for the year ended 31 December 2019.
For the year ended 31 December 2020, the Group's profit attributable to the owners of the Company was approximately RMB305.1 million. The profit attributable to the owners of the Company increased by approximately 70.8% as compared with the net profit of approximately RMB178.6 million for the year ended 31 December 2019.
Goodwill
As at 31 December 2020, the Group's goodwill amounted to approximately RMB20.6 million, primarily attributable to the acquisition of Zhejiang Xinghui.
Operating lease and trade receivables
The Group's operating lease and trade receivables primarily arisen from property leasing services for units located within the shopping malls and shopping streets as well as the provision of various services of the Group's commercial operational service segment and residential property management service segment. As at 31 December 2020, the Group's operating lease and trade receivables were approximately RMB162.0 million, representing an increase of 42.2% as compared with that of approximately RMB113.9 million as at 31
December 2019, primarily attributable to the business growth of the Group.
Prepayments and other receivables
The Group's prepayments and other receivables primarily represent utility fees prepaid to the power supply bureaus, payments on behalf of tenants and residents and advances the Group made to its staff from time to time for business purposes. As at 31 December 2020, prepayments and other receivables amounted to approximately RMB104.8 million, representing an increase of 15.0% as compared with approximately RMB91.1 million as at 31
December 2019. Such increase was primarily attributable to the business growth of the Group.
Trade and other payables
The Group's trade and other payables primarily represent amounts due to suppliers/ subcontractors for the purchase of services and goods and amounts due to related parties, cash received on behalf of tenants or residents, deposits received from tenants or residents, accrued listing expenses and others. As at 31 December 2020, the Group's trade and other payables amounted to approximately RMB1,061.0 million, representing an increase as compared with approximately RMB763.1 million as at 31 December 2019. Such increase was primarily attributable to the expansion of the Group's business scale.
Contract Liabilities
Contract liabilities mainly represent advance payments made by the customers of the Group's commercial operational services and residential property management services. As at 31 December 2020, contract liabilities were approximately RMB309.2 million, representing an increase of 17.5% as compared with that at 31 December 2019, which was mainly due to business expansion.
Contingent liabilities
As of 31 December 2020, the Group did not have any contingent liabilities.
Liquidity and capital resources
The Company has maintained stable financial condition and sufficient liquidity. As at 31 December 2020, the Group's cash and cash equivalents amounted to approximately RMB3,449.1 million, representing a significant increase as compared with approximately RMB2,616.1 million as at 31 December 2019. Such increase was primarily attributable to the business growth of the Group.
Cashflow from operating activities
For the year ended 31 December 2020, the Group's net cash generated from operating activities amounted to approximately RMB795.1 million, compared to approximately RMB533.5 million for the corresponding period of 2019. This was primarily attributable to the business growth of the Group.
Gearing ratio
Gearing ratio is calculated based on total liabilities as at the corresponding date divided by total assets as at the same date. As at 31 December 2020, gearing ratio was 0.52 (31 December 2019: 0.49).
Foreign exchange risk
The Group's businesses are principally conducted in RMB and exposure to foreign currency risk is minimal. As such, during the Reporting Period, the Group had not entered into any forward exchange contract to hedge its exposure to foreign exchange risk.
As at 31 December 2020, major non-RMB assets and liabilities of the Group were cash and cash equivalents denominated in Hong Kong dollar. Fluctuation of the exchange rate of RMB against HK$ could affect the Group's results of operations. The Group closely monitors the fluctuations in exchange rate and will consider hedging its exposure to foreign exchange risk as and when appropriate.
Use of proceeds from the initial public offering
The Company raised net proceeds of (i) approximately HK$1,380.5 million from the initial public offering, and (ii) approximately HK$208.0 million from exercising the over-allotment option on 22 January 2020 (collectively, the "Net Proceeds"). As set out in the prospectus of the Company dated 16 December 2019 (the "Prospectus"), the Company intended to use the Net Proceeds for the purposes as follows: (i) approximately 50% of the Net Proceeds will be used to pursue strategic acquisitions of other small to medium-sized commercial operational service providers in order to scale up its commercial operational service business and expand its commercial operational service portfolio; (ii) approximately 25% of the Net Proceeds will be used to upgrade the information technology systems for digitization and smart operation and management, aiming to enhance consumer experience, improve the quality of services provided to the Group's tenants and improve operational efficiency; (iii) approximately 10% of the Net Proceeds will be used to make equity investment in certain tenants with an aim of establishing close strategic cooperation with them; (iv) approximately 5% of the Net Proceeds will be used for the renovation of retail commercial properties developed or owned by independent third parties under the asset-light business model; and (v) approximately 10% of the Net Proceeds will be used for general business purpose and as working capital of the Group.
As at 31 December 2020, the use of the Net Proceeds from the initial public offering and the over allotment is as follows:
The Net Proceeds from the initial public offering and the over allotment HK$ million
Actual utilised (up to 31 December 2020)
HK$ million
Proceeds unutilised HK$ million
Expected timeline
(i) Pursue strategic acquisition of and investment in other commercial operational service providers
794.3
14.8
779.5 1 January 2020 to
31 December
2023
(ii) Upgrade the information technology systems
397.1
11.0
386.1 1 January 2020 to
31 December
2023
(iii) Make equity investment in certain tenants and suppliers
158.8
-
158.8 1 January 2020 to
31 December
2023
(iv) Renovation of retail commercial properties developed or owned by independent third parties
79.5
6.1
73.4 1 January 2020 to
31 December
2023
(v) General business purpose and working capital
158.8
45.9
112.9 1 January 2020 to
31 December
2023
1,588.5
77.8
1,510.7
As part of the Group's business objective, the Group entered into an investment agreement to acquire 60% of equity interest of Zhejiang Xinghui in July 2020. However, under the outbreak of COVID-19 epidemic, the Group was unable to identify suitable investments in additional commercial operational service providers, tenants or suppliers. The Company plans to selectively evaluate opportunities and identify other suitable acquisition or investment targets. In addition, due to a delay in the upgrading of the information technology systems and renovation plan impacted by the outbreak of COVID-19, the Group only utilised HK$11.0 million and HK$6.1 million, respectively, in upgrading the information technology systems and renovation of retail commercial properties developed or owned by independent third parties.
The remaining amount of unused proceeds is planned to be utilised by 31 December 2023 as originally intended. Accordingly, the Board will re-assess and revise the timeline of the said development where necessary.
As at 31 December 2020, the remaining Net Proceeds from the initial public offering and over allotment were not utilised and were deposited into the licensed banks in Hong Kong and mainland China.
HUMAN RESOURCES
The Group believes that the expertise, experience and professional development of the employees contribute to the growth of the Group. The human resources department of the Company manages, trains and hires employees. As at 31 December 2020, the Group had 5,390 (2019: 5,019) employees. The Group believes in the importance of attraction, recruitment and retention of quality employees in achieving the Group's success. Our success depends on our ability to attract, retain and motivate qualified personnel. As part of our retention strategy, we offer employees performance-based cash bonuses and other incentives in addition to base salaries. The Group also participates in various employee social security plans for its employees, including housing provident fund, pension, medical insurance, social insurance and unemployment insurance. During the year ended 31 December 2020, the Group did not experience any significant labour disputes or any difficulty in recruiting employees.
FUTURE PLANS FOR MATERIAL INVESTMENTS AND CAPITAL ASSETS
The Group intends to utilise the net proceeds raised from the Listing to pursue strategic acquisition of and investment in other commercial operational service providers according to the Prospectus. On 3 July 2020, the Group entered into an Investment Agreement with shareholders of Zhejiang Xinghui, independent third parties of the Group. For further details on the Investment Agreement, please refer to the announcement of the Company dated 6 July 2020. Save as disclosed in this announcement, the Company had not authorised any plan for other material investments or acquisition of capital assets as at the date of this announcement.
SIGNIFICANT INVESTMENTS, ACQUISITIONS AND DISPOSALS OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
Save as disclosed in this announcement, the Company has no significant investments or significant acquisitions, and has no disposal of subsidiaries, associates and joint ventures.
ANNUAL GENERAL MEETING
The annual general meeting of the Company for the year ended 31 December 2020 is proposed to be held on Friday, 11 June 2021 (the "Annual General Meeting"). A notice convening the Annual General Meeting will be published and despatched in the manner as required by the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") in due course.
DIVIDEND
At the Board meeting held on 2 March 2021, the Board recommended the payment of a final dividend of HK$0.18 per ordinary share for the year ended 31 December 2020 (the "Final Dividend"), which is subject to approval by the shareholders at the Annual General Meeting. Together with the interim dividend of HK$0.1 per ordinary share for the six months ended 30 June 2020 paid on 4 December 2020, the total dividend for the year amounted to HK$0.28 per ordinary share. The Final Dividend, if approved by the Company's shareholders, will be paid on or around Wednesday, 11 August 2021 to the shareholders whose names appear on the register of members of the Company on Tuesday, 22 June 2021.
CLOSURE OF REGISTER OF MEMBERS
(a) Attending the Annual General Meeting
For the purpose of determining the shareholders' rights to attend and vote at the Annual General Meeting, the register of members of the Company will be closed from Monday, 7 June 2021 to Friday, 11 June 2021, both days inclusive, during which period no transfer of shares of the Company will be registered.
For the purpose of determining the entitlement to attend and vote at the Annual General Meeting, all transfer document accompanied by the relevant share certificates must be lodged with the Company's branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong for registration no later than 4:30 p.m. on Friday, 4 June 2021.
(b) Payment of the proposed final dividend
For the purpose of determining the shareholders' entitlement to the proposed final dividend for the year ended 31 December 2020, the register of members of the Company will be closed from Friday, 18 June 2021 to Tuesday, 22 June 2021, both days inclusive, during which period no transfer of shares of the Company will be registered.
For the purpose of determining the entitlement to the proposed final dividend for the year ended 31 December 2020, all transfer documents accompanied by the relevant share certificates must be lodged with the Company's branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong for registration no later than 4:30 p.m. on Thursday, 17 June 2021.
MODEL CODE FOR SECURITIES TRANSACTIONS
The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (the "Model Code") as set out in Appendix 10 of the Listing Rules as the code for dealing in securities of the Company by the Directors. Having made specific enquiry by the Company to all the Directors, the Directors confirmed that they were in compliance with the required standard as set out in the Model Code throughout the year ended 31 December 2020. No incident of non-compliance was noted by the Company to date. Relevant employees who are likely to be in possession of unpublished inside information of the Group are also subject to compliance with written guidelines on no less exacting terms than the Model Code throughout the year ended 31 December 2020.
PURCHASE, SALE OR REDEMPTION OF THE COMPANY'S LISTED SECURITIES
On 10 September 2020, the Company entered into the subscription agreement with Mr. Chen Deli (the "Subscription Agreement"), pursuant to which, the Company has conditionally agreed to allot and issue, and Mr. Chen Deli has conditionally agreed to subscribe for the Subscription Shares, being 11.25 million new Shares, at the Subscription Price of HK$24.30 per Subscription Share upon the terms and subject to the conditions set out in the Subscription Agreement.
The total number of 11.25 million Subscription Shares to be issued and allotted under the Subscription Agreement represents (i) 1.81% of the total number of Shares in issue as at 10 September 2020; and (ii) approximately 1.78% of the enlarged total number of Shares in issue upon completion of the Subscription (assuming there will be no change to the total number of Shares in issue from 10 September 2020 to the date of completion of the Subscription other than the allotment and issue of the Subscription Shares by the Company).
The Subscription Price, being HK$24.30 per Subscription Share, represents: (i) the closing price of HK$24.30 per Share as quoted on the Stock Exchange on 10 September 2020, being the date of the Subscription Agreement; (ii) a discount of approximately 2.39% to the average closing price per Share of HK$24.88 for the last five (5) consecutive trading days immediately preceding the date of the Subscription Agreement; and (iii) a discount of approximately 2.18% to the average closing price per Share of HK$24.83 for the last ten (10) consecutive trading days immediately preceding the date of the Subscription Agreement.
The net proceeds from the Subscription is to be approximately HK$273.38 million and is expected to be applied by the Company as to 30% for personnel expansion, as to 30% for IT infrastructure enhancement and as to 40% for the development of the property leasing business and to be utilised on or before 30 June 2023.
Further details of the Subscription is set out in the announcement of the Company dated 10
September 2020 and the circular of the Company dated 5 November 2020.
During the year ended 31 December 2020, the Company repurchased a total of 1,000,000 Shares on the Stock Exchange for an aggregate consideration of approximately HK$9.5 million including expenses. The above mentioned repurchased Shares were cancelled on 24 March 2020. The repurchases reflected the confidence of the Board and the management team in the long-term strategy and the prospects of the Company. The Company considered that the repurchases were in the best interest of the Company and its shareholders as a whole.
Details of the Shares repurchased during the year ended 31 December 2020 are as follows:
No. of | Highest | Lowest | ||
ordinary | price paid | price paid | Aggregate | |
Date of repurchases | shares | per share | per share | Consideration |
(HK$) | (HK$) | (HK$) | ||
30 January 2020 | 500,000 | 9.50 | 9.21 | 4,694,460 |
31 January 2020 | 500,000 | 9.90 | 9.49 | 4,782,055 |
1,000,000 | 9,476,515 |
Save as disclosed above, neither the Company nor any of its subsidiaries had purchased, sold or redeemed any of the Company's listed securities during the Reporting Period.
CORPORATE GOVERNANCE
The Company is committed to the establishment of good corporate governance practices and procedures with a view to enhancing investors' confidence in the Company and the Company's accountability. The Company therefore strives to attain and maintain effective corporate governance practices and procedures.
The Directors are of the view that the Company had complied with all applicable code provisions contained in Appendix 14 of the Listing Rules throughout the year ended 31 December 2020 and up to the date of this announcement. Further information about the corporate governance practices of the Company will be set out in the annual report of the Company for the year ended 31 December 2020.
AUDIT COMMITTEE
The Company has established an audit committee (the "Audit Committee"), which comprises three independent non-executive Directors, in accordance with the requirements under Rule 3.21 of the Listing Rules.
The Audit Committee of the Company has reviewed the audited annual results of the Group for the year ended 31 December 2020 with the Company's management and considered that such results have been prepared in accordance with applicable accounting standards and requirements with sufficient disclosure.
AUDITOR
The figures in respect of the Group's consolidated balance sheet, consolidated statement of comprehensive income and the related notes thereto for the year ended 31 December 2020 as set out in this announcement have been agreed by the Company's external auditor, PricewaterhouseCoopers ("PwC"), to the amounts set out in the Group's audited consolidated financial statements for the year ended 31 December 2020. The work performed by PwC in this respect did not constitute an assurance engagement in accordance with Hong Kong Standards on Auditing, Hong Kong Standards on Review Engagements or Hong Kong Standards on Assurance Engagements issued by the Hong Kong Institute of Certified Public Accountants and consequently, no assurance has been expressed by PwC on this announcement.
PwC shall retire at the forthcoming Annual General Meeting, at which a resolution will be proposed for the re-appointment of PwC as the auditor of the Company.
SUFFICIENCY OF PUBLIC FLOAT
Based on the information that is publicly available to the Company and within the knowledge of the Directors, throughout the year ended 31 December 2020 and up to the date of this announcement, the Company had maintained a sufficient public float of more than 25% of the total number of issued shares of the Company as required under the Listing Rules.
PUBLICATION OF THE 2020 ANNUAL RESULTS AND THE 2020 ANNUAL REPORT ON THE WEBSITES OF THE STOCK EXCHANGE AND THE COMPANY
This announcement is published on the website of the Stock Exchange (www.hkexnews.hk) as well as the website of the Company (www.powerlongcm.com).
The annual report of the Company for the year ended 31 December 2020 will be despatched to the shareholders of the Company and made available on the websites of the Stock Exchange and the Company in due course.
APPRECIATION
The steady growth of the Group is attributable to the enormous support from the relevant parties for years. The Board would like to take this opportunity to express its sincere gratitude to the Group's investors, business partners and customers for their continuous trust and support. At the same time, the Board would also like to take this opportunity to thank the Board members for their work of high performance and the Group's staff for their contributions and dedication. The Group will continue to uphold its tradition of "Creditability, Courtesy, Innovation, Enthusiasm" while relying on an elite team with unified values, loyalty and commitment. It will adhere to its belief and rise to challenges in order to create better returns for its customers, shareholders and investors and to create greater values for the society.
By Order of the Board
Powerlong Commercial Management Holdings Limited
Hoi Wa Fong
Chairman
Hong Kong, 2 March 2021
As at the date of this announcement, the Board comprises three executive Directors, namely, Mr. Hoi Wa Fong, Mr. Chen Deli and Mr. Zhang Yunfeng, two non-executive Directors, namely, Ms. Hoi Wa Fan and Ms. Hoi Wa Lam, and three independent non-executive Directors, namely, Ms. Ng Yi Kum, Estella, Mr. Chan Wai Yan, Ronald and Dr. Lu Xiongwen.
This announcement is available for viewing on the Company's website atwww.powerlongcm.comand the website of the Stock Exchange at www.hkexnews.hk.
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Powerlong Commerical Management Holdings Ltd published this content on 02 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 March 2021 14:43:09 UTC.
