Annual Report 2019 Corporate Information
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Contents Corporate Information 2–3 Chairman’s Statement 4 Management Discussion and Analysis 5–12 Corporate Governance Report 13–27 Environmental, Social and Governance Report 28–36 Biographical Details of Directors and Senior Management 37–41 Report of Directors 42–60 Independent Auditor’s Report 61–65 Consolidated Statement of Profit or Loss and Other Comprehensive Income 66 Consolidated Statement of Financial Position 67–68 Consolidated Statement of Changes in Equity 69 Consolidated Statement of Cash Flows 70–71 Notes to the Consolidated Financial Statements 72–147 Financial Summary 148 CORPORATE INFORMATION BOARD OF DIRECTORS AUDIT COMMITTEE Executive Directors: Mr. Lau Kwok Fai Patrick (Chairman) Mr. Wang Jing (Chairman) Mr. Chan Yuk Sang (appointed on 20 February 2020) Mr. Wan Chi Wai Anthony Mr. Gao Yunhong (re-designated to non-executive Director on 20 February 2020) REMUNERATION COMMITTEE Mr. Lu Xin (resigned on 29 November 2019) Mr. Wan Chi Wai Anthony (Chairman) Ms. Feng Xuelian (appointed on 24 January 2019) Mr. Gao Yunhong Mr. Ng Kin Siu (Chief executive officer) Mr. Chan Yuk Sang Mr. Qi Gang (resigned on 24 January 2019) NOMINATION COMMITTEE Non-executive Director Mr. Wang Jing (Chairman) Mr. Gao Yunhong (re-designated from (appointed on 20 February 2020) executive Director on 20 February 2020) Mr. Gao Yunhong (resigned on 20 February 2020) Ms. Feng Xuelian (appointed on 24 January 2019) Independent non-executive Directors: Mr. Chan Yuk Sang Mr. Chan Yuk Sang Mr. Wan Chi Wai Anthony Mr. Wan Chi Wai Anthony Mr. Lau Kwok Fai Patrick Mr. Lau Kwok Fai Patrick Mr. Qi Gang (resigned on 24 January 2019) COMPANY SECRETARY Mr. Yu Tsz Ngo CORPORATE DEVELOPMENT ADVISER Mr. Zhang Huaqiao HONG KONG LEGAL ADVISER Stevenson, Wong & Co. in association with AllBright Law Offices AUTHORISED REPRESENTATIVES Mr. Ng Kin Siu Mr. Yu Tsz Ngo 02 STEERING HOLDINGS LIMITED • ANNUAL REPORT 2019 CORPORATE INFORMATION AUDITORS Deloitte Touche Tohmatsu Registered Public Interest Entity Auditors REGISTERED OFFICE Cricket Square, Hutchins Drive P. O. Box 2681 Grand Cayman, KY1-1111 Cayman Islands HEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS IN HONG KONG Room 3601, China Resources Building 26 Harbour Road Wanchai Hong Kong PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE Conyers Trust Company (Cayman) Limited Cricket Square, Hutchins Drive P. O. Box 2681 Grand Cayman, KY1-1111 Cayman Islands HONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICE Tricor Investor Services Limited Level 54, Hopewell Centre 183 Queen’s Road East Hong Kong PRINCIPAL BANKERS China Merchants Bank Bank of Communications The Hongkong and Shanghai Banking Corporation Limited WEBSITE ADDRESS www.steering.com.hk STOCK CODE 1826 STEERING HOLDINGS LIMITED • ANNUAL REPORT 2019 03 CHAIRMAN’S STATEMENT Dear Shareholders, On behalf of the board (the “Board”) of Directors (the “Directors”) of Steering Holdings Limited (the “Company”), it is my pleasure to present the audited financial statements of the Company and its subsidiaries (collectively referred to as the “Group”) for the year ended 31 December 2019. RESULTS The total revenue of the Group increased by approximately HK$644.8 million or 99.4% from approximately HK$648.5 million for the year ended 31 December 2018 to approximately HK$1,293.3 million for the year ended 31 December 2019. The Group’s profits attributable to owners of the Company decreased by approximately HK$11.5 million or 35.8% from approximately HK$32.1 million for the year ended 31 December 2018 to approximately HK$20.6 million for the year ended 31 December 2019. BUSINESS REVIEW AND PROSPECT In 2019, the Directors had been actively exploring different business opportunities in order to diversify the existing construction business in Hong Kong and to explore new markets with significant growth potential in the People’s Republic of China (the “PRC”). The Directors believe that the diversification of business and income stream will take advantage of new business opportunities that may give rise to more sustainable growth in shareholders’ value and empower us to capture greater opportunities. Construction segment During the year ended 31 December 2019, the overall market condition of the construction industry had been facing the challenges of no material expansion in the relevant market demand, high construction costs and labour shortage. The Group remains cautiously optimistic about the overall business prospects. Considering our proven track record and comprehensive services, we believe that we could strengthen our position in the Hong Kong market by attracting larger corporate customers and tenders for more capital-intensive projects for such customers. We also believe that the trend of the overall construction market is stable in view of the growth in private housing activities. Financial information and technology services segment The Group commenced the financial information and technology services business in the PRC since the last quarter of 2018. For the year ended 31 December 2019, the Group continued to expand the operation scale of the financial information and technology services business. In future, we will continue to expand and diversify our principal businesses and operations. In this regard, we may look into business and investment opportunities in different business areas and geographical locations and consider whether any asset disposals, asset acquisitions, business rationalisation, business divestment, fund raising, and/or restructuring of the business will be appropriate in order to enhance the long-term growth potential of the Group. A NOTE OF APPRECIATION On behalf of the Board, I wish to take this opportunity to express our gratitude to our shareholders, clients, business partners and suppliers who trust and remain faithful to the Group. I would also like to express our sincere thanks to the management and staff for their commitment and contribution to the continued success of business throughout the years. Wang Jing Chairman Hong Kong, 11 May 2020 04 STEERING HOLDINGS LIMITED • ANNUAL REPORT 2019 MANAGEMENT DISCUSSION AND ANALYSIS INTRODUCTION Construction segment The services involved in the construction segment include: contracting services for alteration and addition works, maintenance, specialist works and new development; and consulting services for alteration and addition works, new development, licensing, building services, and architectural design for buildings in Hong Kong. The Group provides one- stop integrated solution for both contracting and consulting services from project planning, resources allocation, subcontractor management and material procurement to monitoring and quality assurance, and to offering value- adding services such as providing advice on designs to the Group’s customers. Financial information and technology services segment This segment involved the provision of financial information and technology services to the individuals in the People’s Republic of China (the “PRC”). The Group has developed a range of high integrity and user friendly platforms for the users in the PRC, and acting as a nationwide enterprise with diverse products in the financial related service industry. BUSINESS REVIEW AND OUTLOOK The Group continued to develop the contracting and consulting services in the construction segment in Hong Kong and the financial information and technology services business in the PRC. The Directors believe that the continuous diversification of business and income streams will take advantage of new business opportunities that may give rise to more sustainable growth in shareholders’ value and empower us to capture greater opportunities. For the year ended 31 December 2019, there were 82 contracting projects and 380 consulting projects (2018: 93 contracting projects and 397 consulting projects) with revenue contribution. The demands for the Group’s contracting and consulting services slightly dropped as compared with the previous year. The Group possesses the expertise and experience to deliver solutions that may add value to its projects. As at 31 December 2019, the Group’s in-house team of professional staff for both contracting and consulting services comprised of a total of 19 (2018: 15) staff with professional qualifications which maintained a similar level as compared with the previous year. The qualified and experienced personnel, including authorized persons, authorized signatories, surveyors and engineers, can cope with the Group’s business development for both contracting and consulting services by undertaking projects of larger scale and of higher complexity. The Group commenced the financial information and technology services business in the PRC since the last quarter of 2018. For the year ended 31 December 2019, the Group continued to expand the operation scale of the financial information and technology services business. The Directors believe that the financial information and technology services segment will continue to support the continuous growth of the Group and enhance the long-term growth potential of the Company and its shareholders’ value. The business operation of the Group has been moderately affected by the COVID-19 coronavirus outbreak (the “Epidemic”). Some of the customers’ repayments are in unexpected arrears. In addition, strict anti-epidemic measures implemented in the PRC has resulted in difficulties for some of the Group’s employees in the PRC to report duty, which has adversely affected the operational efficiency of the Group. The Company expects that the situation