ARTGROUPHOLD：2024ANNUALREPORT.pdf

《ARTGROUPHOLD：2024ANNUALREPORT.pdf》由會員分享，可在線閱讀，更多相關《ARTGROUPHOLD：2024ANNUALREPORT.pdf（137頁珍藏版）》請在三個皮匠報告上搜索。

1、2024ANNUAL REPORT(Incorporated in the Cayman Islands with limited liability)(Stock Code:565)ART GROUP HOLDINGS LIMITED2024年報ANNUAL REPORT 2024ART GROUP HOLDINGS LIMITED 年報 錦藝集團控股有限公司CONTENT 1ART GROUP HOLDINGS LIMITEDAnnual Report 2024Corporate Information2Chairmans Statement3Management Discussion a

2、nd Analysis7Directors15Directors Report17Corporate Governance Report24Environmental,Social and Governance Report38Independent Auditors Report54Consolidated Statement of Profit or Loss and Other Comprehensive Income61Consolidated Statement of Financial Position62Consolidated Statement of Changes in E

3、quity64Consolidated Statement of Cash Flows66Notes to the Consolidated Financial Statements68Financial Summary135Schedule of Leased Investment Properties136CORPORATE INFORMATION 2ART GROUP HOLDINGS LIMITEDAnnual Report 2024BOARD OF DIRECTORSMr.Chen Jinyan(Chairman)Mr.Su Peixin(Chief Executive Office

4、r)(appointed on 21 August 2024)Mr.Chen Jindong(resigned on 21 August 2024)Mr.Yao Linying(appointed on 24 June 2024)Ms.Cai Wenxiao*(appointed on 28 November 2023 and resigned on 23 January 2024)Mr.Chong Hon Wang*(appointed on 25 July 2024)Mr.Kwan Chi Fai*(resigned on 25 July 2024)Ms.Chong Sze Pui Joa

5、nne*Ms.Wang Yuqin*Non-executive Director*Independent Non-executive DirectorCOMPANY SECRETARYMs.Yeow Mee Mooi(resigned on 1 December 2023 and appointed on 23 January 2024)Ms.Shum Ching Yee Jennifer(appointed on 1 December 2023 and resigned on 23 January 2024)AUDITORConfucius International CPA Limited

6、Certified Public AccountantsRegistered Public Interest Entity AuditorsHEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS IN HONG KONGUnit A,1st Floor,Yun Tat Commercial Building70-74 Wuhu Street,Kowloon,Hong KongWebsite:https:/.hkREGISTERED OFFICE3rd Floor,Century YardCricket SquareP.O.Box 902Grand Cayman

7、KY1-1103Cayman IslandsPRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICETricor Services(Cayman Islands)Limited3rd Floor,Century YardCricket SquareP.O.Box 902Grand Cayman KY1-1103Cayman IslandsHONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICETricor Investor Services Limited17th Floor,Far East Finance C

8、entre16 Harcourt RoadHong KongPRINCIPAL BANKERSBank of ZhengzhouBank of ChinaHang Seng BankSHARE LISTINGThe Stock Exchange of Hong Kong Limited(Stock code:565)CHAIRMANS STATEMENT 3ART GROUP HOLDINGS LIMITEDAnnual Report 2024On behalf of the board of directors(the“Board”)of Art Group Holdings Limited

9、（錦藝集團控股有限公司）(the“Company”)and its subsidiaries(together,the“Group”),I would like to report that the Group recorded a revenue of HK$111,160,000(2023:HK$143,233,000)and a loss for the year of HK$270,792,000(2023:HK$683,448,000).BUSINESS REVIEWWith a view to magnifying the Companys development potentia

10、l and the shareholders return,the Group places its business focus and resources in property operating aspect to become an asset-light and service-oriented property operator,explore more prospects and develop relevant markets in-depth.The Group is principally engaged in property operating business th

11、rough holding all equity interests in 鄭州中原錦藝商業運營管理有限公司(Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co.,Ltd.)(“Zhongyuan Jinyi”),鄭州金福商業管理有限公司(Zhengzhou Jinfu Commercial Management Co.,Ltd.)(“Zhengzhou Jinfu”)and 鄭州旭福商業運營管理有限公司(Zhengzhou Xufu Commercial Operation Management Co.,Ltd.)(“Zh

12、engzhou Xufu”)in the Peoples Republic of China(the“PRC”).The principal activity of Zhongyuan Jinyi,Zhengzhou Jinfu and Zhengzhou Xufu is property operating business.The Group leased partial of the Jiachaos Shopping Mall and the whole Zone C Shopping Mall from a number of landlords,both shopping mall

13、s situated in Zhengzhou City,Henan Province,the PRC.The Jiachaos Shopping Mall,with a rental period to expire in the mid of 2036,comprises altogether a 4-storey shopping mall and one level of basement commercial space.As a result of certain areas of the Jiachaos Shopping Mall involved in the litigat

14、ion with a creditor of its landlord,the Group could not generate any income on such areas.The Groups leased area of the Jiachaos Shopping Mall reduced from 125,188.32 square meters to 74,655.84 square meters from 22 June 2024.The Group generates revenue from the monthly incomes of rental,management

15、and operating service receivables from tenants under the respective tenancy agreements with a remaining term ranging from one year to eleven years.Nevertheless,the Group promoted and further rented out the remaining Jiachaos Shopping Mall to approximately 119 tenants and approximately 87.5%of the le

16、ttable area had been leased out as of 30 June 2024 as retail shops,restaurants and/or for entertainment and leisure use.The Jiachaos Shopping Mall is a one-stop shopping paradise that offers a wide range of services and goods to consumers and shoppers including a cinema,a supermarket,KTV(a karaoke b

17、ox),jewelries,beauty shops,electrical appliances shops,car sales,international labels for fashion,fitness,lifestyle,casual wear/sport,kids paradise,kids learning and restaurants.Certain areas of the Jiachaos Shopping Mall are rented to tenants on short-term leases for use,including kiosks and booths

18、 of trendy and stylish items.In addition,the Zone C Shopping Mall,with a rental period to expire in the mid of 2036,is a 5-storey integrated commercial mall built over one level of basement commercial space with a gross floor area of approximately 80,118 square meters.The Zone C Shopping Mall is a s

19、hopping mall located adjacent to the Jiachaos Shopping Mall.The Group promoted and further rented out the Zone C Shopping Mall to various independent tenants under the respective tenancy agreements with a remaining term ranging from one year to twelve years.As of 30 June 2024,approximately 91 tenant

20、s and approximately 85.0%of the lettable area of the Zone C Shopping Mall had been leased out as retail shops and restaurants and/or for entertainment and leisure use.The Zone C Shopping Mall offers a wide range of services and goods including a cinema,an aquarium,a photo shop,beauty shops,car sales

21、,international labels for fashion,lifestyle,casual wear/sport,kids paradise,kids learning and restaurants.Certain areas of the Zone C Shopping Mall are rented to tenants on short-term leases for use including kiosks and booths of trendy and stylish items.CHAIRMANS STATEMENT 4ART GROUP HOLDINGS LIMIT

22、EDAnnual Report 2024The Group has an advantage in having an existing team of high-caliber and experienced management and staff to run the two shopping malls together.As such,the extra costs for running the shopping malls have been minimal to the Group and the Group can generate considerable incomes

23、from the provision of rental,management and operating services to tenants of the two shopping malls.The larger the area of the shopping mall,the more the number of similar types of shops open,and thus more customers will be attracted by offering them a large diversity and well-known brand choices.Po

24、sitive benefits and synergy effects on the customer flow and the tenant grade will be brought to the Group through management of both the Jiachaos Shopping Mall and the Zone C Shopping Mall together,eventually contributing to affirmative revenue and profit margin of property operating business.On 28

25、 April 2021,an indirect wholly-owned PRC subsidiary of the Company entered into a loan agreement with 福建千城綠景觀工程有限公司(Fujian Qiancheng Lujingguan Engineering Co.,Ltd.),an independent third party,(the“Borrower”)pursuant to which,it was agreed to lend to the Borrower a loan in the principal amount of RM

26、B250 million for a term of 12 months from the drawdown date at an interest of 7.5%per annum.During the year ended 30 June 2022,the principal amount was revised to RMB210 million,as well as the interest of 4.785%per annum.The Group keeps focusing its resources on property operating business and has n

27、o intention to commence money lending business.The Borrower approached the Group and looked for a source of financing.The entering into of the aforesaid loan agreement is due to(i)the surplus cash position of the Group;(ii)the interest income to be received by the Group;and(iii)the credit and repaym

28、ent ability of the Borrower and its guarantor.On 29 June 2022,the parties agreed to extend the repayment date of the loan to 27 April 2023(the“Renewed Loan”).Before extending the Renewed Loan,the Company has performed certain works to assess the credit risk and repayment ability of the Borrower and

29、the guarantors and such works included(i)obtained and reviewed the latest management accounts of the Borrower then available;(ii)understood the updated business,operation and forecast of the Borrower;(iii)obtained and reviewed certain current business contracts of the Borrower and the guarantors;and

30、(iv)conducted updated background and corporate searches of the Borrower and the guarantors.During the year ended 30 June 2024,the Borrower settled RMB20 million and HK$15 million after the maturity date on 27 April 2023.As of 30 June 2024,the Group had not received further payments of the remaining

31、principal amount of approximately RMB145.7 million.The Group has been in discussions with the Borrower about a revised repayment schedule of the Renewed Loan throughout the current year.Please also refer to the announcements of the Company dated 28 April 2021,13 May 2021,19 November 2021,27 May 2022

32、,29 June 2022,23 February 2023 and 6 December 2023,as well as the circular of the Company dated 12 August 2022 for details.The COVID-19 epidemic spread across the globe starting from the beginning of 2020,and since then,the situation around the world has changed rapidly.The Groups business has been

33、impacted by the closure of the shopping malls and controls of the epidemic to a significant extent during the past few years.COVID-19 had become the endemic disease,therefore,during the year ended 30 June 2024,the Group did not give preferential charges to the tenants of the Jiachaos Shopping Mall a

34、nd the Zone C Shopping Mall anymore.While during the year ended 30 June 2023,the Group had supported more than 275 tenants of two shopping malls(including kiosks and booths of trendy and stylish items)who were affected by the epidemic by reducing their rental,management and operating service charges

35、 on different bases with an aggregated amount of approximately HK$23,025,000.The Group had seen cost reduction as a key strategic focus to help navigate business uncertainty resulting from the epidemic.CHAIRMANS STATEMENT 5ART GROUP HOLDINGS LIMITEDAnnual Report 2024In light of the above advantages,

36、the Company expands its property operating business through its indirect wholly-owned PRC subsidiary which holds entire equity interests in 鄭州英睿物業服務有限公司(Zhengzhou Yingrui Property Services Co.,Ltd.)(“Zhengzhou Yingrui”)after the reporting period.Zhengzhou Yingrui leased 42 houses with a rental perio

37、d to expire in the first half of 2027 and with a gross floor area of approximately 130,873 square meters in an industrial park,the Jinyi Zhiyun City,located in Xinmi City,Henan Province.The Group promoted and further rented out the Jinyi Zhiyun City to approximately 79 tenants and approximately 73.2

38、%of the lettable area had been leased out after the reporting period as production,processing and sales of mens and womens shoes,processing and sales of shoe accessories and wholesale of groceries.The Group continues to penetrate the property operating market,explores other new market potentials and

39、 increases profit margin by leveraging its established strengths,experience and foresight and by applying strict cost control policy and financial planning.The directors of the Company(the“Directors”)believe that the Group will achieve a steadily better performance in its future results.STRATEGIES A

40、ND OUTLOOKAfter several years of the pandemic and slower-than-expected economic recovery to the PRC economy,the Group adjusts its future operating plans to upgrade its property operating segment by offering tenancies to more popular brands and will continue to diversify the types of tenants to meet

41、the needs and interests of customers from different ages and backgrounds.To achieve these aims,the Group increases large-scale marketing and promotion activities in the eastern and western festivals to raise the popularity of the shopping malls,pays close attention to business operations,helps key m

42、erchants in time and follows closely with market trends to make appropriate management decisions in a timely manner.Hence,the leased properties under the Groups management always generate a stable and constant stream of income and consistent cash flow to the Group,which ultimately benefits the Compa

43、ny and its shareholders as a whole.However,due to the pandemic since the beginning of 2020,the return of funds has slowed down,the overall cash flow has had some impact on the Groups financial position.The Groups management assesses the performance of current leased properties regularly and will det

44、ermine necessary arrangements in the best and long-term interests of the Company and its shareholders.Moreover,any possible investment opportunities of the property operating business will always be explored because of the enormous population and strong consuming power in the PRC under the effects o

45、f the Belt and Road Initiative and the Internal/External Circular Economy;as a result,a robust market potential is foreseeable.In response to ongoing challenges,the Group has been focusing on maintaining sustainable financial results from its property operating business to obtain a more profitable o

46、utcome.The Board gives its input in determining the Groups strategy development and planning process,as well as the generation and preservation of the Groups long-term value.Consequently,the Board closely monitors and regularly reviews the results of the implementation of the strategies,with the goa

47、l of reviving the Groups performance,enhancing its competitiveness and improving its share value.CHAIRMANS STATEMENT 6ART GROUP HOLDINGS LIMITEDAnnual Report 2024The Group continues with its prudent cost management policy to attain greater efficiency in operations and a reasonable financial position

48、 to pursue business development and new opportunities for strengthening its business momentum.The Group holds a moderate financial position,and its property operating business continues to contribute steady and constant cash flows.The Group maintains its long-standing commitment to a prudent and cau

49、tious financial management policy and is confident of increasing share value in the long term.Looking forward,a steady business growth of the Group is expected in the future.We will adopt a vigilant approach in developing the existing projects and exploring new opportunities,including cooperation wi

50、th business partners.We will continue to seek and invest resources in appropriate property operating projects with the objective of expanding our revenue sources,improving our profitability as well as diversifying our types of business to further develop the business of the Group and increase the sh

51、areholders return.ACKNOWLEDGEMENTOn behalf of the Board,I would like to present my heartfelt thanks to the tenants,customers,bankers,business partners and shareholders of the Company for their incessant support and trust and to each staff member of the Group for their diligent work.The achievement o

52、f the Group and its readiness to continue tackling the biggest challenges at an unprecedented pace and scale would not be possible without the contribution of each of the staff members and their dedication.Chen JinyanChairmanHong Kong,17 October 2024MANAGEMENT DISCUSSION AND ANALYSIS 7ART GROUP HOLD

53、INGS LIMITEDAnnual Report 2024OPERATIONAL AND FINANCIAL REVIEWThe Group is principally engaged in property operating business through holding all equity interests in 鄭州中原錦藝商業運營管理有限公司(Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co.,Ltd.)(“Zhongyuan Jinyi”),鄭州金福商業管理有限公司(Zhengzhou Jinfu C

54、ommercial Management Co.,Ltd.)(“Zhengzhou Jinfu”)and 鄭州旭福商業運營管理有限公司(Zhengzhou Xufu Commercial Operation Management Co.,Ltd.)(“Zhengzhou Xufu”)in the Peoples Republic of China(the“PRC”).The principal activity of Zhongyuan Jinyi,Zhengzhou Jinfu and Zhengzhou Xufu is property operating business.The Gro

55、up leased partial of the Jiachaos Shopping Mall and the whole Zone C Shopping Mall from a number of landlords,both shopping malls situated in Zhengzhou City,Henan Province,the PRC.The Jiachaos Shopping Mall,with a rental period to expire in the mid of 2036,comprises altogether a 4-storey shopping ma

56、ll and one level of basement commercial space.As a result of certain areas of the Jiachaos Shopping Mall involved in the litigation with a creditor of its landlord,the Group could not generate any income on such areas.The Groups leased area of the Jiachaos Shopping Mall reduced from 125,188.32 squar

57、e meters to 74,655.84 square meters from 22 June 2024.The Group generates revenue from the monthly incomes of rental,management and operating service receivables from tenants under the respective tenancy agreements with a remaining term ranging from one year to eleven years.Nevertheless,the Group pr

58、omoted and further rented out the remaining Jiachaos Shopping Mall to approximately 119 tenants and approximately 87.5%of the lettable area had been leased out as of 30 June 2024 as retail shops,restaurants and/or for entertainment and leisure use.The Jiachaos Shopping Mall is a one-stop shopping pa

59、radise that offers a wide range of services and goods to consumers and shoppers including a cinema,a supermarket,KTV(a karaoke box),jewelries,beauty shops,electrical appliances shops,car sales,international labels for fashion,fitness,lifestyle,casual wear/sport,kids paradise,kids learning and restau

60、rants.Certain areas of the Jiachaos Shopping Mall are rented to tenants on short-term leases for use,including kiosks and booths of trendy and stylish items.In addition,the Zone C Shopping Mall,with a rental period to expire in the mid of 2036,is a 5-storey integrated commercial mall built over one

61、level of basement commercial space with a gross floor area of approximately 80,118 square meters.The Zone C Shopping Mall is a shopping mall located adjacent to the Jiachaos Shopping Mall.The Group promoted and further rented out the Zone C Shopping Mall to various independent tenants under the resp

62、ective tenancy agreements with a remaining term ranging from one year to twelve years.As of 30 June 2024,approximately 91 tenants and approximately 85.0%of the lettable area of the Zone C Shopping Mall had been leased out as retail shops and restaurants and/or for entertainment and leisure use.The Z

63、one C Shopping Mall offers a wide range of services and goods including a cinema,an aquarium,a photo shop,beauty shops,car sales,international labels for fashion,lifestyle,casual wear/sport,kids paradise,kids learning and restaurants.Certain areas of the Zone C Shopping Mall are rented to tenants on

64、 short-term leases for use,including kiosks and booths of trendy and stylish items.MANAGEMENT DISCUSSION AND ANALYSIS 8ART GROUP HOLDINGS LIMITEDAnnual Report 2024The Group has an advantage in having an existing team of high-caliber and experienced management and staff to run the two shopping malls

65、together.As such,the extra costs for running the shopping malls have been minimal to the Group and the Group can generate considerable incomes from the provision of rental,management and operating services to tenants of the two shopping malls.The larger the area of the shopping mall,the more the num

66、ber of similar types of shops open,and thus more customers will be attracted by offering them a large diversity and well-known brand choices.Positive benefits and synergy effects on the customer flow and the tenant grade will be brought to the Group through management of both the Jiachaos Shopping M

67、all and the Zone C Shopping Mall together,eventually contributing to affirmative revenue and profit margin of property operating business.On 28 April 2021,an indirect wholly-owned PRC subsidiary of the Company entered into a loan agreement with 福建千城綠景觀工程有限公司(Fujian Qiancheng Lujingguan Engineering C

68、o.,Ltd.),an independent third party,(the“Borrower”)pursuant to which,it was agreed to lend to the Borrower a loan in the principal amount of RMB250 million for a term of 12 months from the drawdown date at an interest of 7.5%per annum.During the year ended 30 June 2022,the principal amount was revis

69、ed to RMB210 million,as well as the interest of 4.785%per annum.The Group keeps focusing its resources on property operating business and has no intention to commence money lending business.The Borrower approached the Group and looked for a source of financing.The entering into of the aforesaid loan

70、 agreement is due to(i)the surplus cash position of the Group;(ii)the interest income to be received by the Group;and(iii)the credit and repayment ability of the Borrower and its guarantor.On 29 June 2022,the parties agreed to extend the repayment date of the loan to 27 April 2023(the“Renewed Loan”)

71、.Before extending the Renewed Loan,the Company has performed certain works to assess the credit risk and repayment ability of the Borrower and the guarantors and such works included(i)obtained and reviewed the latest management accounts of the Borrower then available;(ii)understood the updated busin

72、ess,operation and forecast of the Borrower;(iii)obtained and reviewed certain current business contracts of the Borrower and the guarantors;and(iv)conducted updated background and corporate searches of the Borrower and the guarantors.During the year ended 30 June 2024,the Borrower settled RMB20 mill

73、ion and HK$15 million after the maturity date on 27 April 2023.As of 30 June 2024,the Group had not received further payments of the remaining principal amount of approximately RMB145.7 million.The Group has been in discussions with the Borrower about a revised repayment schedule of the Renewed Loan

74、 throughout the current year.Please also refer to the announcements of the Company dated 28 April 2021,13 May 2021,19 November 2021,27 May 2022,29 June 2022,23 February 2023 and 6 December 2023,as well as the circular of the Company dated 12 August 2022 for details.The COVID-19 epidemic spread acros

75、s the globe starting from the beginning of 2020,and since then,the situation around the world has changed rapidly.The Groups business has been impacted by the closure of the shopping malls and controls of the epidemic to a significant extent during the past few years.COVID-19 had become the endemic

76、disease,therefore,during the year ended 30 June 2024,the Group did not give preferential charges to the tenants of the Jiachaos Shopping Mall and the Zone C Shopping Mall anymore.While during the year ended 30 June 2023,the Group had supported more than 275 tenants of two shopping malls(including ki

77、osks and booths of trendy and stylish items)who were affected by the epidemic by reducing their rental,management and operating service charges on different bases with an aggregated amount of approximately HK$23,025,000.The Group had seen cost reduction as a key strategic focus to help navigate busi

78、ness uncertainty resulting from the epidemic.MANAGEMENT DISCUSSION AND ANALYSIS 9ART GROUP HOLDINGS LIMITEDAnnual Report 2024RevenueFor the year ended 30 June 2024,the Group recorded a revenue of approximately HK$111,160,000(2023:HK$143,233,000),approximately 22.4%less than that in 2023.Revenue of t

79、he Group included the monthly income of rental,management and operating services received and receivable from the tenants of the Jiachaos Shopping Mall and the Zone C Shopping Mall.The decrease in revenue during the year ended 30 June 2024 was due to certain areas of the Jiachaos Shopping Mall invol

80、ved in the litigation with the landlords creditor,the Group therefore could not generate any income on such areas.Gross ProfitThe gross profit margin was approximately 64.5%for the year ended 30 June 2024(2023:73.8%).Property operating segment has simple costs of sales due to its business nature,suc

81、h as water,electricity and heat supply charges,rent,salary and wages,marketing and promotion expenses,public security and hygiene expenses,repair and maintenance fees etc.incurred for operating the shopping malls.The decrease in gross profit margin was due to a decrease in revenue because of certain

82、 areas of the Jiachao Shopping Mall involved in the litigation with the landlords creditor,the Group therefore could not generate any income on such areas.Loss for the YearThe Groups loss incurred for the year ended 30 June 2024 was approximately HK$270,792,000(2023:HK$683,448,000).The loss margin w

83、as approximately 243.6%for the year ended 30 June 2024(2023:477.2%).Both decreased significantly for the year ended 30 June 2024 mainly because of a substantial decrease in loss on fair value changes of the Groups investment properties,the Jiachaos Shopping Mall and the Zone C Shopping Mall,of appro

84、ximately HK$260,870,000(2023:HK$720,225,000)due to slow recovery of Chinas macro-economy during the current year,particularly the real estate market.Some real estate companies still have financial pressure.Under the influence of multiple factors,the supply and demand ends of the commercial real esta

85、te market are still weak.Other Income and Other Gain and LossOther income and other gain and loss for the year ended 30 June 2024 was approximately HK$13,253,000(2023:HK$28,476,000),which comprised interest incomes and other kinds of incomes generated from property operating segment,such as car park

86、ing fees and other services provided to tenants.The decrease in other income and other gain and loss was mainly because loan interest income was reduced significantly for the year ended 30 June 2024.ExpensesAdministrative expenses amounted to approximately HK$24,742,000(2023:HK$21,766,000),represent

87、ing approximately 22.3%(2023:15.2%)of revenue for the year ended 30 June 2024.Administrative expenses increased in the current year due to more professional fees incurred for the adoption of a new share option scheme,appointments of new directors and company secretary etc.and more operating expenses

88、 incurred for new property operating market development.Allowance for expected credit loss on rental deposits amounted to approximately HK$89,712,000(2023:HK$19,247,000)for the year ended 30 June 2024 was due to the seizure and title transfer of certain areas of the Jiachaos Shopping Mall by a numbe

89、r of banks and financial institutions as a result of the exercise of their rights under the pledges of the shopping mall created by its owner,which in turn increased the credit risk to a certain extent.MANAGEMENT DISCUSSION AND ANALYSIS 10ART GROUP HOLDINGS LIMITEDAnnual Report 2024Reversal of allow

90、ance for expected credit loss on loan receivables was approximately HK$37,310,000 because of settlements of RMB20 million and HK$15 million made by the Borrower during the year ended 30 June 2024.There was no allowance for expected credit loss on loan receivables for the year ended 30June 2024(2023:

91、HK$184,361,000).The Renewed Loan had not been settled on its maturity date,hence,the Borrower was considered to be in default as of 28 April 2023,and therefore,that loan receivable was transferred to stage 3 or written-off during the year ended 30 June 2023 where lifetime expected credit loss was re

92、cognised.Moreover,there was no allowance for expected credit loss of another loan receivable of HK$18 million arranged during the yaer ended 30 June 2024 because of its pledged securities and subsequent settlement made after the reporting period.Gain on lease modification was approximately HK$41,698

93、,000(2023:Nil).As described in note 34 to the consolidated financial statements,since certain areas of the Jiachaos Shopping Mall was involved in litigation with a creditor of its landlord,the rental area of 50,532.48 square meters of the Jiaochaos Shopping Mall was deducted from the Jiachaos Lease

94、Contract pursuant to the judgment of the Peoples Court of Zhongyuan District,Zhengzhou City,Henan Province.In light of the above,Zhongyuan Jinyi and Zhengzhou Jiachao entered into the Supplemental Agreement to amend the leased area under the Jiachaos Lease Contract starting from 22 June 2024,which c

95、onstituted a lease modification in the year ended 30 June 2024.For the lease modification,the Group remeasured lease liabilities corresponding to the remaining leased area of the Jiachaos Shopping Mall.The remeasured amount that differed from the original lease liabilities was reduced from the Group

96、s lease liabilities,which was calculated to be approximately RMB195 million(equivalent to approximately HK$212,350,000).At the same time,the entering into of the Supplemental Agreement as tenant by Zhongyuan Jinyi required the Group to derecognise the amount from the Groups investment properties,bec

97、ause of the reduction of the leased area under the Jiachaos Lease Contract.The fair values derecognised by the Group under the Supplemental Agreement amounted to approximately RMB157 million(equivalent to approximately HK$170,652,000).By doing so,the Group recognised a gain from lease modification o

98、f approximately HK$41,698,000(2023:Nil)during the year ended 30 June 2024.The carrying value of the Groups investment properties,partial of the Jiachaos Shopping Mall and the Zone C Shopping Mall,as of 30 June 2024 of approximately HK$568,817,000(2023:HK$995,699,000)was stated at fair value based on

99、 an independent valuation as at that date,which produced a loss on fair value changes of investment properties of approximately HK$260,870,000(2023:HK$720,225,000).Decrease in the carrying value and the loss on fair value changes of investment properties was mainly due to slow recovery of Chinas mac

100、ro-economy during the current year,particularly the real estate market.Some real estate companies still have financial pressure.Under the influence of multiple factors,the supply and demand ends of the commercial real estate market are still weak.As a result,the commercial rental performance decreas

101、ed.The PRC government has made expanding domestic demand and increased customer consumption through some measures.In addition,customer consumption demands are constantly upgrading,and they pay more attention to consumption experience.The young customers(generation Z)prefer the integration of concept

102、s such as green,health,humanities and art,which can fit their interests,hobbies and lifestyles.The Group has conducted large-scale marketing and promotional activities to fit and attract different kinds of customers.Finance costs amounted to approximately HK$39,485,000(2023:HK$43,761,000),representi

103、ng approximately 35.5%(2023:30.6%)of revenue for the year ended 30 June 2024.Decrease in finance costs was mainly due to fewer interest expenses of lease liabilities incurred during the year ended 30 June 2024 because lease modification with respect to certain areas of the Jiachaos Shopping Mall inv

104、olved in the litigation with a creditor of its landlord was carried out.MANAGEMENT DISCUSSION AND ANALYSIS 11ART GROUP HOLDINGS LIMITEDAnnual Report 2024DividendThe Board does not recommend the payment of a final dividend for the year ended 30 June 2024(2023:Nil).During the year ended 30 June 2024,t

105、he Board declared and paid a special dividend of HK$0.001 per share to the shareholders of the Company.FUTURE PLANS AND PROSPECTSIn view of achieving the best interests of the Company and its shareholders as a whole,the Group has been putting effort on developing and expanding its operations of prop

106、erty operating business.Substantial resources have been placed to explore prospects and develop relevant markets.The Company therefore expands its property operating business through its indirect wholly-owned PRC subsidiary which holds entire equity interests in 鄭州英睿物業服務有限公司(Zhengzhou Yingrui Proper

107、ty Services Co.,Ltd.)(“Zhengzhou Yingrui”)after the reporting period.Zhengzhou Yingrui leased 42units with a rental period to expire in the first half of 2027 and with a gross floor area of approximately 130,873 square meters in an industrial park,the Jinyi Zhiyun City,located in Xinmi City,Henan Pr

108、ovince,the PRC.The Group promoted and further rented out the Jinyi Zhiyun City to approximately 79 tenants and approximately 73.2%of the lettable area had been leased out after the reporting period as production,processing and sales of mens and womens shoes,processing and sales of shoe accessories a

109、nd wholesale of groceries.The Group will continue to enlarge the properties for its property operating business by exploring other properties including similar industrial parks.The Group targets to engage in the provision of rental,management and operating services to more tenants of different kinds

110、 of properties in various locations.The Group persists in upgrading the tenants of the Jiachaos Shopping Mall and the Zone C Shopping Mall by offering tenancies to more popular brands and diversifying the types of tenants to meet the needs and interests of customers from different ages and backgroun

111、ds.To achieve these aims,the Group conducts large-scale marketing and promotion activities to raise the popularity of the shopping malls,paying close attention to the business operations,helping key merchants in time and following closely with market trends to make appropriate management decisions i

112、n a timely manner so that a stable and constant stream of income and consistent cash flow can be continuously generated to the Group.The world keeps changing during and after the time of the epidemic,in particular geopolitical tensions,regulatory changes and the high-interest-rate environment,of whi

113、ch,global economy in the coming year would still be highly variable and its pace of recovery from economic uncertainties continues to fluctuate.This poses a tremendous challenge to the Group.Nevertheless,the Group has been striving to use all its resources on hand flexibly to cope with the difficult

114、ies.By leveraging on the Groups current strategic plan and established strengths,experience and foresight,the Group continues to seize opportunities to penetrate different areas of the property operating market,explore other new market potential and increase profit margin.MANAGEMENT DISCUSSION AND A

115、NALYSIS 12ART GROUP HOLDINGS LIMITEDAnnual Report 2024The Group will continue to deploy its resources on the property operating business including but not limited to(i)apart from the current caliber management and competent employees of its subsidiaries,recruit more candidates with high-caliber and

116、experience in property operating business;(ii)explore suitable shopping malls/properties to expand the Groups property management and operating portfolio;(iii)possible merger and acquisition of asset-light property operating business in the PRC so as to further expand the Groups property management

117、and operating portfolio;and(iv)keep implementing conservative and stringent cost control policies to maintain sufficient working capital and alleviate the financial pressure on the property operating business by imposing control over operating costs and capital expenditures and strengthening account

118、s receivable management.According to the National Bureau of Statistics,in the first half year of 2024,gross domestic product was approximately RMB61.7 trillion,representing an increase of approximately 5%to the corresponding period in 2023.The PRC government also gradually implemented policies to ex

119、pand domestic demand for goods and services and promote consumption,which is expected to continue effectively to stimulate consumption potential,in particular household,promote the release of consumer demand,and thereby enhance merchant confidence.The shop leasing market in different cities is expec

120、ted to continue to recover.Looking forward,the Group continues to place on its property operating business by enhancing the value and economic returns of the existing two shopping malls,expanding the properties the Group operates and diversify the Groups business when and where opportunities arise.B

121、y continually capturing opportunities for expansion and diversifying the Groups business with extra prudence in flexibility and efficiency in the management,decision-making and long-term strategy formulation,the market value of the Company and the return to its shareholders will be maximised in the

122、long term.LIQUIDITY AND FINANCIAL RESOURCESAs at 30 June 2024,the Group had net current liabilities and total assets less current liabilities of approximately HK$51,194,000(2023:HK$117,001,000)and HK$571,561,000(2023:HK$1,052,451,000),respectively.The Group has maintained its financial position by f

123、inancing its operations with internally generated resources and issue of bonds.As at 30June 2024,the Group had cash and bank deposits of approximately HK$40,239,000(2023:HK$33,152,000).The current ratio of the Group was approximately 63.3%(2023:35.2%).Total deficit of the Group as at 30 June 2024 wa

124、s approximately HK$7,938,000(total equity in 2023:HK$268,442,000).As at 30 June 2024,two bonds(2023:two bonds)measured at amortised cost was approximately HK$10,005,000(2023:HK$10,003,000)in aggregate,the gross debt gearing ratio(i.e.bonds/shareholders fund)was approximately negative 126.0%(2023:3.7

125、%).The substantial shareholders have agreed to provide the Company with sufficient financial support to enable the Company to meet its obligations to third parties as and when they fall due and to continue as a going concern.Though the return of funds has slowed down since 2020 as a result of the on

126、going COVID-19 epidemic,the Group still has maintained and will continue to maintain a reasonable amount of working capital on hand in order to maintain its financial position,and sufficient resources are expected to be generated from its business operations and financial support from the substantia

127、l shareholders of the Company in meeting its short-term and long-term obligations.MANAGEMENT DISCUSSION AND ANALYSIS 13ART GROUP HOLDINGS LIMITEDAnnual Report 2024FINANCINGAs at 30 June 2024,the Group had no borrowing facilities.As at 30 June 2023,the total bank facilities of the Group amounted to a

128、pproximately HK$6,129,000,of which,no facilities was utilised.In addition,two bonds(2023:two bonds)amounted to approximately HK$10,005,000(2023:HK$10,003,000)in aggregate,measured at amortised cost,were arranged with one(2023:one)independent third party.The Board believes that the existing financial

129、 resources will be sufficient to meet future expansion plans and,if necessary,the Group will be able to obtain additional financing with favourable terms.CAPITAL STRUCTUREAs at 30 June 2024,the share capital of the Company comprised ordinary shares only.FOREIGN EXCHANGE RISK AND INTEREST RATE RISKDu

130、ring the year ended 30 June 2024,the Group was not subject to any significant exposure to foreign exchange rates risk as most of its transactions were denominated in RMB.Hence,no financial instrument for hedging was employed.The Board monitors interest rate change exposure and may consider a hedging

131、 policy should the need arise.CHARGE ON GROUPS ASSETSAs at 30 June 2024,the Group did not pledge any assets to any banks or financial institutions.As at 30 June 2023,the building and the leasehold land of the Group with net carrying amount of approximately HK$3,278,000 and HK$3,563,000,respectively,

132、were pledged to a bank to secure bank facilities granted to the Group.CAPITAL EXPENDITUREDuring the year ended 30 June 2024,the Group invested approximately HK$70,000(2023:HK$203,000)in property,plant and equipment,all was used for purchase of leasehold improvements and office equipment.As at 30 Jun

133、e 2024,the Group had no capital commitments in property,plant and equipment(2023:Nil).MANAGEMENT DISCUSSION AND ANALYSIS 14ART GROUP HOLDINGS LIMITEDAnnual Report 2024STAFF POLICYThe Group had 132 employees altogether in the PRC and Hong Kong as at 30 June 2024.The Group offers comprehensive and com

134、petitive remuneration,retirement schemes and a benefit package to its employees.A discretionary bonus is offered to the Groups staff depending on their performance.The Group is required to make contributions to a social insurance scheme in the PRC.Moreover,the Group and its employees in the PRC are

135、required to make respective contributions to fund the endowment insurance,unemployment insurance,medical insurance,employees compensation insurance and birth insurance(for employers only)at the rates specified in the relevant PRC laws and regulations.The Group has adopted a provident fund scheme as

136、required under the Mandatory Provident Fund Schemes Ordinance(Chapter485 of the Laws of Hong Kong)for its employees in Hong Kong.The Group also provides periodic internal training to its employees.Three independent non-executive Directors are appointed by the Company for a term of one year commencin

137、g from 25 July,19 September and 1 December each year respectively.CONTINGENT LIABILITIESAt the end of the reporting period,the Group and the Company did not have any significant contingent liabilities.DIRECTORS 15ART GROUP HOLDINGS LIMITEDAnnual Report 2024EXECUTIVE DIRECTORSMr.Chen Jinyan（陳錦艷）,aged

138、 55,is the founder of the Group,the Executive Director and the Chairman of the Company and is responsible for the Groups operation.Mr.Chen has over 10 years of experience in property operations.Mr.Chen obtained a Diploma in the Design of Textile Products from the Textile Engineering Faculty of Jiang

139、xi Textile Industry Academy*（江西紡織工業學院）and thereafter had over 28 years of experience in the textile industry.He is the executive director and executive vice president of China Federation of Overseas Chinese Entrepreneurs*（中國僑商聯合會）and the president of Henan Province Overseas Chinese Entrepreneurs*（河南

140、省僑商聯合會）.He is the elder brother of Mr.Chen Jindong.Mr.Su Peixin（蘇培欣）,aged 34,is appointed as Executive Director and the Chief Executive Officer of the Company in August 2024 and is responsible for administration and finance of the Group.Mr.Su has over 14 years of experiences in the property developm

141、ent industry.Mr.Su worked for Fujian Quanzhuo Nanan City Xinyi Property Development Co.Ltd.*（福建泉州南安市鑫溢房地產開發有限公司）and served as the project vice-president and supervisor from May 2010 to December 2014,a director and the sales director from December 2014 to December 2018 and a director and the operatio

142、n director from December 2018 to June 2021.Before joining the Company,Mr.Su worked for Hebei Hong Pu Real Estate Co.Ltd.*（河北鴻樸置業有限公司）as the chief executive officer from August 2021.Mr.Yao Linying（姚霖穎）,aged 38,is appointed as an Executive Director of the Company in June 2024 and is responsible for sc

143、reening,reviewing,research and analysis of the Companys external investment projects,and post-investment management and follow-ups.Mr.Yao has over 10 years of experience in investments area.Mr.Yao graduated from Coventry University in the United Kingdom with a masters degree of business administrati

144、on in global financial services in November 2012.Mr.Chen Jindong（陳錦東）(resigned on 21 August 2024),aged 53,was the previous Executive Director and Chief Executive Officer of the Company and was responsible for administration and finance of the Group.Mr.Chen has over 10 years of experience in property

145、 operations.Mr.Chen obtained a Diploma in Industrial and Financial Accounting from Fuzhou Industrial Academy*（福州工業學院）and thereafter had over 25 years of experience in the textile industry.He is the younger brother of Mr.Chen Jinyan.*For identification onlyDIRECTORS 16ART GROUP HOLDINGS LIMITEDAnnual

146、 Report 2024INDEPENDENT NON-EXECUTIVE DIRECTORSMr.Chong Hon Wang（莊瀚宏）,aged 50,is appointed as an Independent Non-executive Director in July 2024.Mr.Chong currently is a Certified ESG Planner certified by the International Chamber of Sustainable Development as well as a Chartered Tax Adviser from the

147、 Taxation Institute of Hong Kong.Mr.Chong also holds the Certified Public Accountant(Practicing)Certificate issued by the Accounting and Financial Reporting Council.Mr.Chong obtained a Bachelor degree of Arts in Accountancy from the Hong Kong Polytechnic University in 1996,followed by his study as a

148、n External Student with a Master degree of Science in Financial Management from the University of London in 1998.Mr.Chong was also granted a Bachelor degree of Laws from Tsinghua University in China in 2005.Mr.Chong has over 27 years of experience in auditing and accounting services.Ms.Chong Sze Pui

149、 Joanne（張詩培）,aged 51,is appointed as an Independent Non-executive Director since December 2016.Ms.Chong is a Certified Public Accountant of the Hong Kong Institute of Certified Public Accountants,a Chartered Accountant of the Institute of Chartered Accountants Ontario,Canada and a Certified Public A

150、ccountant of the American Institute of Certified Public Accountants.Ms.Chong obtained a Bachelor Degree of Commerce from the University of Melbourne in Australia in 1994.Ms.Chong has over 23 years of experience in auditing,taxation and business development.Ms.Wang Yuqin（王玉琴）,aged 69,is appointed as

151、an Independent Non-executive Director since September 2021.Ms.Wang had over 25 years of experience in accounting before her retirement in May 2006.Ms.Wang had obtained a graduation certificate in Accounting from Henan Finance and Economics Academy*（河南財經學院）(Now known as Henan University of Economics

152、and Law*（河南財經政法大學）).Ms.Wang was the finance manager of Henan Songyue Group Zhengzhou Yufeng Textile Co.,Ltd.*（河南嵩嶽集團鄭州豫豐紡織有限公司）(“Yufeng”)from 1982 to 1996 and the financial controller of Yufeng from 1996 to 2006.Mr.Kwan Chi Fai（關志輝）(resigned on 25 July 2024),aged 60,was appointed as an Independent N

153、on-executive Director since April 2016.Mr.Kwan is a Certified Public Accountant(Practising)in Hong Kong.Mr.Kwan is also a member of the Hong Kong Institute of Certified Public Accountants,a fellow of Association of Chartered Certified Accountants and a Certified Tax Advisor.Mr.Kwan has over 28 years

154、 of experience in auditing and accounting services.*For identification onlyDIRECTORS REPORT 17ART GROUP HOLDINGS LIMITEDAnnual Report 2024The Directors present the annual report and the audited consolidated financial statements of the Group for the year ended 30 June 2024.PRINCIPAL ACTIVITIES AND BU

155、SINESS REVIEWThe Company is an investment holding company.The activities of its principal subsidiaries as at 30 June 2024 are set out in note 33 to the consolidated financial statements.Further discussion and analysis of these activities as required by Schedule 5 to the Companies Ordinance(Chapter 6

156、22 of the Laws of Hong Kong),including a description of the principal risks and uncertainties facing by the Group and an indication of likely future development in the Groups business,can be found in the Chairmans Statement and Management Discussion and Analysis set out on pages 3 to 14 of this annu

157、al report.This discussion forms part of this Directors report.RESULTS AND APPROPRIATIONSThe results of the Group for the year ended 30 June 2024 are set out in the consolidated statement of profit or loss and other comprehensive income on page 61.A special dividend of HK$0.001 per share(2023:Nil)was

158、 paid in March 2024.The Directors do not recommend the payment of a final dividend for the year ended 30 June 2024.FIVE YEAR FINANCIAL SUMMARYA summary of the results and the assets and liabilities of the Group for the last five financial years is set out on page 135 of the annual report.INVESTMENT

159、PROPERTIESDetails of movements during the year ended 30 June 2024 in investment properties of the Group are set out in note 17 to the consolidated financial statements.PROPERTY,PLANT AND EQUIPMENTDetails of the movements in the property,plant and equipment of the Group during the year ended 30 June

160、2024 are set out in note 15 to the consolidated financial statements.SHARE CAPITALDetails of the movements during the year in the share capital of the Company are set out in note 28 to the consolidated financial statements.DISTRIBUTABLE RESERVES OF THE COMPANYDetails of movements in reserves and cha

161、nges in equity of the Company during the year ended 30 June 2024 are set out in note 32 to the consolidated financial statements.DIRECTORS REPORT 18ART GROUP HOLDINGS LIMITEDAnnual Report 2024DIRECTORSThe Directors during the year and up to the date of this report were:Executive directors(each an“Ex

162、ecutive Director”):Mr.Chen JinyanMr.Chen Jindong(resigned on 21 August 2024)Mr.Su Peixin(appointed on 21 August 2024)Mr.Yao Linying(appointed on 24 June 2024)Non-executive Director:Ms.Cai Wenxiao(appointed on 28 November 2023 and resigned on 23 January 2024)Independent Non-executive Directors:Mr.Kwa

163、n Chi Fai(resigned on 25 July 2024)Mr.Chong Hon Wang(appointed on 25 July 2024)Ms.Chong Sze Pui JoanneMs.Wang YuqinIn accordance with Articles 86 and 87 of the Articles of Association of the Company,Messrs.Su Peixin,Yao Linying,Chong Hon Wang and Ms.Wang Yuqin will retire by rotation and,being eligi

164、ble,offer themselves for re-election at the forthcoming annual general meeting.DIRECTORS SERVICE CONTRACTSThe service agreement for Mr.Chen Jinyan expired on 31 August 2024 and he was re-appointed by the Board on 1 September 2024 to continue to act as an Executive Director of the Company for a term

165、of two years.Mr.Su Peixin has entered into a service agreement with the Company for a fixed term of one year commencing from 21 August 2024 and expiring on 20 August 2025(both days inclusive),and subject to mutual agreement,his appointment will continue thereafter.Mr.Yao Linying has entered into a s

166、ervice agreement with the Company for a fixed term of one year commencing from 24 June 2024 and expiring on 23 June 2025(both days inclusive),and subject to mutual agreement,his appointment will continue thereafter.Mr.Chen Jinyans service agreements can be terminated by either party by giving three

167、months prior written notice.Mr.Su Peixins service agreement and Mr.Yao Linyings service agreement can be terminated by either party by giving one months prior written notice.Each of the Independent Non-executive Directors entered into service agreements with the Company for a term of one year.Either

168、 the Company or Mr.Chong Hon Wang,the Independent Non-executive Director,may terminate the appointment by giving the other a prior notice of one month in writing before its expiration.Either the Company or Ms.Chong Sze Pui Joanne and Ms.Wang Yuqin,the Independent Non-executive Directors,may terminat

169、e the appointment by giving the other a prior notice of two months in writing before its expiration.Other than as disclosed above,none of the Directors being proposed for re-election at the forthcoming annual general meeting has a service agreement with the Company which is not determinable by the C

170、ompany within one year without payment of compensation,other than statutory compensation.DIRECTORS REPORT 19ART GROUP HOLDINGS LIMITEDAnnual Report 2024DIRECTORS INTERESTS IN SHARES AND UNDERLYING SHARESAs at 30 June 2024,the interests of the Directors and their associates in the shares and underlyi

171、ng shares of the Company and its associated corporations,as recorded in the register maintained by the Company pursuant to Section 352 of the Securities and Futures Ordinance(Chapter 571 of the Laws of Hong Kong)(“SFO”),or as otherwise notified to the Company and The Stock Exchange of Hong Kong Limi

172、ted(the“Stock Exchange”)pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers,were as follows:Long positionsOrdinary shares of HK$0.01 each of the CompanyName of directorCapacityNumber of issuedordinaryshares heldPercentage of the issuedshare capitalof the CompanyMr.C

173、hen JindongHeld by his spouse(Note 1)369,100,00013.73%Mr.Chen JinyanBeneficial owner and held by controlled corporation(Note 2)597,280,00022.21%Notes:(1)Among the 369,100,000 shares,324,340,000 shares are held by Jinjie Limited,a company incorporated in the British Virgin Islands(the“BVI”),the entir

174、e issued share capital of which is beneficially owned by the spouse of Mr.Chen Jindong,Ms.Lin Lin and 44,760,000 shares are held by Ms.Lin Lin.Mr.Chen Jindong is deemed to be interested in 369,100,000 shares of the Company.(2)Among the 597,280,000 shares,593,480,000 shares are held by Fully Chain Li

175、mited,a company incorporated in the BVI,the entire issued share capital of which is beneficially owned by Mr.Chen Jinyan and 3,800,000 shares are held by Mr.Chen Jinyan.Mr.Chen Jindong is the younger brother of Mr.Chen Jinyan.Other than as disclosed above,none of the Directors,chief executives or th

176、eir associates had any interest or short positions in any shares or underlying shares of the Company or any of its associated corporations as at 30 June 2024.DIRECTORS REPORT 20ART GROUP HOLDINGS LIMITEDAnnual Report 2024ARRANGEMENT TO PURCHASE SHARES OR DEBENTURESSave as disclosed under the section

177、 headed“Share options”below,at no time during the year was the Company,its holding company,or any of its subsidiaries,a party to any arrangements to enable the Directors to acquire benefits by means of acquisition of shares in,or debentures of,the Company or any other body corporate.DIRECTORS INTERE

178、STS IN CONTRACTS OF SIGNIFICANCENo contract of significance,to which the Company,its holding company or any of its subsidiaries was a party and in which a director of the Company had a material interest,whether directly or indirectly,subsisted at the end of the year or at any time during the year en

179、ded 30 June 2024.MANAGEMENT CONTRACTSNo contracts,other than a contract of service with any director or any person engaged in the full-time employment of the Company,concerning the management and administration of the whole or any substantial part of the business of the Company were entered into or

180、existed during the year ended 30 June 2024.RELATED PARTY TRANSACTIONSDetails of the related party transactions are set out in note 30 to the consolidated financial statements.DIRECTORS REMUNERATIONThe remuneration committee makes recommendations to the Board on the remuneration and other benefits pa

181、id by the Company to the Directors.The remuneration of all Directors is subject to regular monitoring by the remuneration committee to ensure that the levels of their remuneration and compensation are appropriate.Details of the Directors remuneration are set out in note 12 to the consolidated financ

182、ial statements.DIRECTORS REPORT 21ART GROUP HOLDINGS LIMITEDAnnual Report 2024SUBSTANTIAL SHAREHOLDERSAs at 30 June 2024,the register of substantial shareholders maintained by the Company pursuant to Section 336 of the SFO shows that other than the interests disclosed in the section headed“Directors

183、 interests in shares and underlying shares”above,the following shareholders had notified the Company of relevant interests in the issued share capital of the Company.Long positions Ordinary shares of HK$0.01 each of the CompanyName of shareholderCapacityNumber ofissuedordinaryshares heldPercentage o

184、fthe issuedshare capitalof the CompanyMs.Lin LinBeneficial owner and interest in a controlled corporation369,100,00013.73%Mr.Chen JinqingBeneficial owner and interest in a controlled corporation(Note)188,315,000 7.00%Dresdner VPV N.V.Investment manager 139,755,200 5.20%Note:Among the 188,315,000 sha

185、res,166,000,000 shares are held by Ultimate Name Limited,a company incorporated in the BVI,the entire issued share capital of which is beneficially owned by Mr.Chen Jinqing and 22,315,000 shares are held by Mr.Chen Jinqing.Mr.Chen Jinqing is the youngest brother of Mr.Chen Jinyan and Mr.Chen Jindong

186、.Other than disclosed above,the Company has not been notified of any other relevant interests or short positions in the issued share capital of the Company as at 30 June 2024.SHARE OPTIONSParticulars of the Companys share option scheme are set out in note 29 to the consolidated financial statements.

187、The following table disclosed movements in the Companys share options during the year:GranteeDate of grantExercise periodExercisepriceOutstanding as at 1.7.2023Granted during the yearExercised during the yearForfeited during the yearOutstanding as at 30.6.2024HK$Employees15.1.201815.1.2018 to 14.1.2

188、0280.43026,850,00026,850,000Granted Total26,850,00026,850,000DIRECTORS REPORT 22ART GROUP HOLDINGS LIMITEDAnnual Report 2024APPOINTMENT OF INDEPENDENT NON-EXECUTIVE DIRECTORSThe Company has received,from each of the Independent Non-executive Directors,an annual confirmation of his independence pursu

189、ant to Rule 3.13 of the Rules Governing the Listing of Securities on the Stock Exchange(the“Listing Rules”).The Company considers that all of the Independent Non-executive Directors are independent.MAJOR CUSTOMERS AND SUPPLIERSDuring the year ended 30 June 2024,the aggregate sales attributable to th

190、e Groups five largest customers accounted for 11%(2023:29%)of the Groups total sales and the sales attributable to the Groups largest customer were approximately 5%(2023:17%)of the Groups total sales.The aggregate purchases during the year attributable to the Groups five largest suppliers accounted

191、for 44%(2023:37%)of the Groups total purchases and the purchases attributable to the Groups largest supplier were approximately 15%(2023:14%)of the Groups total purchases.None of the Directors,their associates or any shareholders of the Company which,to the knowledge of the Directors,owned more than

192、 5%of the Companys issued share capital,had any interest in any of the five largest customers or suppliers of the Group.PURCHASE,SALE OR REDEMPTION OF THE COMPANYS LISTED SECURITIESDuring the year ended 30 June 2024,neither the Company nor any of its subsidiaries purchased,sold or redeemed any of th

193、e Companys listed securities.PRE-EMPTIVE RIGHTSThere are no provisions for pre-emptive rights under the Companys Articles of Association,or the laws of the Cayman Islands,which would oblige the Company to offer new shares on a pro-rata basis to its existing shareholders.PERMITTED INDEMNITY PROVISION

194、Pursuant to the Articles of Association of the Company,every Director shall be entitled to be indemnified by the Company out of the assets of the Company against all costs,charges,losses,damages and expenses which he/she may sustain or incur or about the execution and discharge of his/her duties or

195、in relation thereto.The Company has arranged appropriate Directors and Officers liability insurance coverage for the Directors and officers of the Company during the year ended 30 June 2024.EMOLUMENT POLICYThe emolument policy of the employees of the Group is set up by the Remuneration Committee on

196、the basis of their merit,qualifications and competence.The emoluments of the Directors are decided by the Board,who are authorised by the shareholders in the annual general meeting,having regard to the Companys operating results,individual performance and comparable market statistics.The Company has

197、 adopted share option schemes as an incentive to the Directors and eligible employees,details of these schemes are set out in note 29 to the consolidated financial statements for the year ended 30 June 2024.DIRECTORS REPORT 23ART GROUP HOLDINGS LIMITEDAnnual Report 2024SUFFICIENCY OF PUBLIC FLOATBas

198、ed on the information that is publicly available to the Company and within the knowledge of the Directors,there was a sufficient prescribed public float of the issued shares of the Company under the Listing Rules throughout the year ended 30 June 2024.CORPORATE GOVERNANCEPrincipal corporate governan

199、ce practices adopted by the Company are set out in the Corporate Governance Report on pages 24 to 37 of this annual report.SOCIAL RESPONSIBILITIES AND ENVIRONMENTAL POLICIESInformation on the work done and efforts made by the Company on environmental protection and other aspects for the sustainable

200、growth and development of the business of the Group are set out in the Environmental,Social and Governance Report on pages 38 to 53 of this annual report.EVENT AFTER THE REPORTING PERIODThe Company understands that Zhengzhou Jiachao Property Services Co.,Ltd.*（鄭州佳潮物業服務有限公司）(“Zhengzhou Jiachao”),the

201、landlord of the Jiachaos Shopping Mall,has taken out loans and charged its properties,including the Jiachaos Shopping Mall,to the creditors.The Company further understands that certain creditors brought actions against Zhengzhou Jiachao for default in payments.Pursuant to the judgment of the Peoples

202、 Court of Zhongyuan District,Zhengzhou City,Henan Province(2024)Yu 0102 Ming Chu No.4142)（河南省鄭州市中原區人民法院(2024)豫0102民初4142號 民事判決書）,the leased area of 50,532.48 square meters of the Jiaochaos Shopping Mall was deducted from the lease contract dated 26 April 2021 entered into by Zhengzhou Jiachao as the

203、 lessor and Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co.,Ltd.*(“Zhongyuan Jinyi”)（鄭州中原錦藝商業運營管理有限公司）as the lessee in respect of the Jiachaos Shopping Mall with a leased area of 125,188.32 square meters(“Jiachaos Lease Contract”)and rental income from the sub-tenant with respect to th

204、ose leased area shall be paid to the court.In light of the above,the parties entered into a supplemental agreement(“Supplemental Agreement”)to amend the leased area under Jiachaos Lease Contract starting from 22 June 2024.Please also refer to the announcement of the Company dated 9 October 2024 for

205、details.AUDITORFollowing the resignation of Elite Partners CPA Limited and Peng Sheng CPA Limited as the auditor of the Company on 20 August 2024 and 16 September 2024 respectively,Confucius International CPA Limited(“CICPA”)was appointed by the Board as the new auditor of the Company on 16 Septembe

206、r 2024 to fill the casual vacancy.The consolidated financial statements of the Company for the year ended 30 June 2024 were audited by CICPA.On behalf of the BoardChen JinyanCHAIRMANHong Kong17 October 2024*For identification onlyCORPORATE GOVERNANCE REPORT 24ART GROUP HOLDINGS LIMITEDAnnual Report

207、2024The Group adheres to the purpose of“serving the country by industry”,establishes the values of“integrity,dedication,teamwork,and win-win”and always clings to the business development direction of making the industry bigger and stronger.At present,the Group has successfully cultivated its core pr

208、operty operating business through its current resources and strengths,both human and financial.Moreover,the Group is committed to achieving the best corporate governance practices as a listed company.The corporate governance policy aims to improve the accountability and transparency of the Group by

209、regulating the Groups corporate governance practices.During the year ended 30 June 2024,the Group applied the principles and met the code provisions set out in the Corporate Governance Code(the“CG Code”)contained in Appendix C1 of the Listing Rules.MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS

210、(THE“MODEL CODE”)The Group has adopted the Model Code set out in Appendix C3 of the Listing Rules as the code of conduct regarding directors securities transactions.All Directors have confirmed that they have complied with the required standard set out in the Model Code throughout the year ended 30

211、June 2024.The Company has also established written guidelines(the“Employees Written Guidelines”)no less exacting than the Required Standard of Dealings for securities transactions by employees who are likely to be in possession of unpublished price-sensitive information of the Company.No incident of

212、 non-compliance of the Employees Written Guidelines by the employees was noted by the Company.THE BOARDThe Board reviewed the effectiveness of the policy annually in order to ensure the adherence of the Groups culture and satisfied with its implementation and effectiveness.During the year under revi

213、ew,the composition of the Board,with at least one-third of which are independent non-executive Directors,was as follows:Mr.Chen Jinyan(Chairman,Executive Director)Mr.Chen Jindong(Chief Executive Officer,Executive Director)Mr.Yao Linying(Executive Director,appointed on 24 June 2024)Ms.Cai Wenxiao(Non

214、-executive Director,appointed on 28 November 2023 and resigned on 23 January 2024)Mr.Kwan Chi Fai(Independent Non-executive Director)Ms.Chong Sze Pui Joanne(Independent Non-executive Director)Ms.Wang Yuqin(Independent Non-executive Director)Each executive Director(the“Executive Director(s)”)has suff

215、icient experience to hold the position so as to carry out his/her duties effectively and efficiently.Each independent non-executive Director(“INED(s)”)has confirmed his/her independence with the Company and the Company considers that each of the INEDs to be independent under Rule 3.13 of the Listing

216、 Rules.Each INED was appointed for a term of one year.The Board members have no financial,business or other material/relevant relationships with each other except that Mr.Chen Jinyan is the elder brother of Mr.Chen Jindong.Under Code Provision B.2.2,every director,including those appointed for a spe

217、cific term,should be subject to retirement by rotation at least once every three years.CORPORATE GOVERNANCE REPORT 25ART GROUP HOLDINGS LIMITEDAnnual Report 2024THE BOARD(Continued)The Board has effectively overseen and monitored the activities of the Company and the decisions were made in the best

218、interests of the Company and its shareholders taken as a whole.During the year ended 30 June 2024,ten Board meetings were held and the attendance of all Directors at the Board meetings was as follows:Name of DirectorsAttendanceMr.Chen Jinyan10/10Mr.Chen Jindong10/10Mr.Yao Linying0/0Ms.Cai Wenxiao0/1

219、Mr.Kwan Chi Fai10/10Ms.Chong Sze Pui Joanne10/10Ms.Wang Yuqin10/10Note:1 Board meeting from 28 November 2023 to 23 January 2024 and no Board meeting from 24 June 2024 to 30 June 2024 was held during the year ended 30 June 2024.The Board convened the Board meetings in performance of its duties,to con

220、sider,approve and review,inter alia,the interim review fee for the period ended 31 December 2023 and the annual audit fee for the year ended 30 June 2024;the adequacy of resources,qualifications and experience of staff for the Companys accounting and financial reporting function,and their training p

221、rogrammes and budget;publication of interim and annual results announcements;declaration,recommendation and payment of interim,final and special dividends;and the internal control review report of the Company.Directors training is an ongoing process and its purpose is to improve Directors knowledge

222、of,and performance in,business operations and compliance matters.During the year ended 30 June 2024,the Directors received regular updates and presentations on changes and developments to the Groups business and to the legislative and regulatory environments in which the Group operates.All Directors

223、 should attend relevant training courses and can be claimed at the Companys expense.Moreover,all Directors are required to provide the Company with their respective training records.The record of continuing professional development relating to directors duties and regulatory and business development

224、 that has been received by the Directors for the year ended 30 June 2024 is summarised as follows:(i)attending training sessions such as briefings,seminars,conferences and workshops;and(ii)reading/studying relevant material such as newspapers,journals,magazines and others publications.The Group has

225、mechanisms to ensure independent views and input are available to the Board and such mechanisms will be reviewed annually by the Board,encouraging all directors including INEDs to express their views in an open manner during the Board/board committees meetings;while all INEDs are also members of the

226、 board committees to enable various and independent view in the Companys matters.CORPORATE GOVERNANCE REPORT 26ART GROUP HOLDINGS LIMITEDAnnual Report 2024THE BOARD(Continued)In addition,all Directors,including INEDs,are entitled to seek further information and documentation from the management on t

227、he matters to be discussed at the Board meetings.They can also seek assistance from the company secretary(the“Company Secretary”)and,where necessary,independent advice from external professional advisers at the Companys expense.The Board considered the said mechanisms has been operating effectively.

228、OPERATION OF THE BOARDThe principal roles of the Board are to oversee the Companys operation,administration and finance,to design and set corporate policies and development strategies and to implement and monitor the Companys business plans,such as property operating market expansion and tenant grow

229、th with delighting shoppers,while the senior management is responsible for the execution of the Boards decisions in order to achieve the Companys goals and objectives.The Board has separate and independent access to the senior management for collecting information on operation.The Board is also resp

230、onsible for reviewing the effectiveness of the Groups internal control system annually.An external professional party conducted review of the effectiveness of the Groups system of internal control.The audit committee of the Board reviewed the findings and opinion of the external professional party o

231、n the effectiveness of the Groups system of internal control.In respect of the year ended 30 June 2024,the Board considered the internal control system effective and adequate.No significant areas of concern which might affect shareholders were identified.The Company has arranged appropriate liabilit

232、y insurance to indemnify the Directors for their liabilities arising out of corporate activities.The insurance coverage will be reviewed regularly to ensure its effectiveness and sufficiency.Whistleblowing PolicyThe Company has adopted Whistleblowing Policy to allow and encourage all employees to ra

233、ise concerns about improprieties in matters of financial reporting,criminal action,environmental protection,compliance and other malpractices at the earliest.Employees can raise concerns in confidential about any improprieties such as misconduct and malpractice in any matter related to the Group.All

234、 the concerns received will be handled confidential in prompt and fair manner.The policy aims at protecting the whistle-blowers from unfair dismissal,victimisation and unwarranted disciplinary actions.Anti-Corruption PolicyAnti-Corruption Policy is set up as a part of the employees guideline.The emp

235、loyees should follow the anti-corruption policy as their daily working guideline.The Group is maintained a high standard of integrity,openness and discipline in the business operations.Combined with Whistleblowing Policy,the Groups expectations and requirement of business ethics is adopted with all

236、employees.In addition,the Board reviewed the adequacy of the resources,qualifications and experience of staff for the Groups accounting and financial reporting function,and their training programmes and budget.The audit committee also reviewed and was satisfied with the adequacy of the staffing of t

237、he financial reporting functions.CORPORATE GOVERNANCE REPORT 27ART GROUP HOLDINGS LIMITEDAnnual Report 2024OPERATION OF THE BOARD(Continued)Anti-Corruption Policy(Continued)The Board comprises a majority of INEDs who are independent of and not related to each other and any members of the senior mana

238、gement.INEDs are members of all related committees.Separation of the role of the Chairman and the Chief Executive Officer ensures that there is a balance of power and authority.The Nomination Policy sets a maximum tenure of nine consecutive years for INEDs to be eligible for nomination by the Board

239、to stand for re-election by shareholders.INEDs receive fixed fee(s)for their role as members of the Board.In assessing suitability of the candidates,the nomination committee will review their profiles,including their qualification and time commitment,having regard to the Boards composition,the Direc

240、tors skill matrix,the list of selection criteria approved by the Board,the Nomination Policy and the Board Diversity Policy.DIRECTORS RESPONSIBILITIES FOR FINANCIAL REPORTING IN RESPECT OF FINANCIAL STATEMENTSThe Directors acknowledge their responsibilities for the preparation of the financial state

241、ments for each financial year,which give a true and fair view of the financial position of the Company and the Group and of the financial performance and cash flows of the Group for that year ended 30 June 2024.The Directors ensure that the financial statements for the year ended 30 June 2024 were p

242、repared in accordance with statutory requirements and applicable accounting standards.The financial statements were prepared on a going concern basis.There are no material uncertainties relating to events or conditions that may cast significant doubt on the Companys ability to continue as a going co

243、ncern.It is the responsibility of the auditor to form an independent opinion on these statements and to report their opinion to the Group.DISTINCTIVE ROLES OF CHAIRMAN AND CHIEF EXECUTIVE OFFICERThe roles of chairman and chief executive officer are segregated in order to ensure a balance of power an

244、d authority in the management of the Board and the day-to-day management of the business.Mr.Chen Jinyan is the Chairman of the Company and Mr.Chen Jindong,who is the younger brother of Mr.Chen Jinyan,is the Chief Executive Officer of the Company.The duties of the Chairman include:(a)to ensure all Di

245、rectors are properly briefed on issues arising at Board meetings;(b)to ensure all Directors receive adequate information,which must be complete and reliable,in a timely manner;(c)to provide leadership to the Board;(d)to hold a meeting with the INEDs without the presence of other director annually;(e

246、)to ensure appropriate steps have been taken to provide effective communication with shareholders,such as release of website announcements,circulars,interim and annual reports and holding of annual general meeting etc.;(f)to ensure that good corporate governance practices and procedures are establis

247、hed;and(g)to conform to any requirement,direction and regulation that may from time to time be prescribed by the Board or contained in the constitution of the Company or imposed by the Listing Rules or other applicable laws,rules and regulations.CORPORATE GOVERNANCE REPORT 28ART GROUP HOLDINGS LIMIT

248、EDAnnual Report 2024DISTINCTIVE ROLES OF CHAIRMAN AND CHIEF EXECUTIVE OFFICER(Continued)The duties of the Chief Executive Officer include:(a)to be responsible for the day-to-day management of the Groups business;(b)to develop strategies and policies for the Boards approval;(c)to be responsible for t

249、he performance of the Group and the implementation of the Boards strategies and policies;(d)to maintain effective systems of internal control and risk management;(e)to ensure that proper financial records and accounts are kept;and(f)to ensure all applicable laws,rules and regulations and other relev

250、ant statements of best practice are complied with.COMMITTEES OF THE COMPANYThe Board had established the audit committee,remuneration committee and nomination committee and their authorities and duties that stated in specific written terms of reference had been discussed and approved in the Board me

251、eting.AUDIT COMMITTEEWith specific written terms of reference,the audit committee of the Company(the“AC”)comprises three members,all being INEDs;namely,Mr.Kwan Chi Fai,Ms.Chong Sze Pui Joanne and Ms.Wang Yuqin.Mr.Kwan Chi Fai,who is a member of the Hong Kong Institute of Certified Public Accountants

252、,a fellow of Association of Chartered Certified Accountants and a Certified Tax Advisor,is the chairman of the AC.The ACs terms of reference are posted on the websites of the Company and the Stock Exchange.The principal role and function of the AC are:(a)in relation to the Companys external auditor,

253、to recommend the Board on its appointment,re-appointment and removal,remuneration and terms of engagement of the external auditor,its independence,effectiveness of audit process,as well as nature and scope of audit and reporting obligations before the audit commences;(b)to monitor the integrity of f

254、inancial statements of the Group and the annual reports and interim reports focusing particularly on any changes in accounting policies and practices,major judgmental areas,significant adjustments resulting from the audit,going concern assumptions and qualifications,compliance with accounting standa

255、rds and the Listing Rules;CORPORATE GOVERNANCE REPORT 29ART GROUP HOLDINGS LIMITEDAnnual Report 2024AUDIT COMMITTEE(Continued)(c)to review and make recommendations of the Groups financial control,internal control and risk management systems;(d)to consider major investigation findings on risk managem

256、ent and internal control matters as delegated by the Board or on its own initiative and managements response to these findings;(e)where an internal audit function exists,to review the internal audit programme,ensure coordination between the internal and external auditors,and ensure that the internal

257、 audit function is adequately resourced and has appropriate standing within the Company,and to review and monitor its effectiveness;(f)to discuss with the management the system of internal control and ensure that the management has discharged its duty to have an effective internal control system;(g)

258、to review the external auditors management letter,any material queries raised by the auditor to management about accounting records,financial accounts or systems of control and managements response;(h)to ensure that the Board will provide a timely response to the issues raised in the external audito

259、rs management letter;and(i)to review the Groups financial and accounting policies and practices.In addition,the AC has been delegated by the Board to be responsible for performing the corporate governance duties that are listed as follows:(a)to develop and review the Companys policies and practice o

260、n corporate governance and make recommendations to the Board;(b)to perform the Companys corporate governance functions;(c)to review and monitor the training and continuous professional development of directors and senior management of the Company;(d)to review and monitor the Companys policies and pr

261、actices on compliance with legal and regulatory requirements;(e)to develop,review and monitor the code of conduct and compliance manual applicable to employees and directors of the Company;and(f)to review the Companys compliance with the CG Code and disclosure in this Corporate Governance Report.COR

262、PORATE GOVERNANCE REPORT 30ART GROUP HOLDINGS LIMITEDAnnual Report 2024AUDIT COMMITTEE(Continued)During the year ended 30 June 2024,seven AC meetings were held and the attendance of its members was as follows:Name of membersAttendanceMr.Kwan Chi Fai 7/7Ms.Chong Sze Pui Joanne7/7Ms.Wang Yuqin7/7The f

263、ollowing is a summary of the work performed by the AC during the year ended 30 June 2024 in discharging its responsibilities and its duties set out in the CG Code:reviewed the annual report and interim report,focusing particularly on any changes in accounting policies and practices,major judgmental

264、areas,significant adjustments resulting from audit,the going concern assumptions,compliance with accounting standard and compliance with the Listing Rules and the Hong Kong Companies Ordinance;assessed the risk environment and risk management system,reviewed internal control procedure manual of the

265、Group and auditors findings and opinion on the Groups system of internal control and considered that the internal control system and the risk management system are effective and adequate and there is no immediate need to set up internal audit function within the Group.The AC will review and consider

266、 establish such department when it thinks necessary;reviewed the adequacy of the resources,qualifications and experience of staff for the Groups accounting and financial reporting function,and their training programmes and budget and was satisfied with the adequacy;reviewed external auditors signifi

267、cant audit matters;considered and approved the annual audit fee and interim review fee;and reviewed and monitored the external auditors independence and engagement to perform non-audit services and the interim review for the period ended 31 December 2023 before the Board meeting.The chairman of the

268、AC reports the findings and recommendations of the AC to the Board after each meeting.The AC had discussed with the auditor regarding the annual audit for the year ended 30 June 2023.The Groups audited consolidated financial statements for the year ended 30 June 2024 have been reviewed by the AC,whi

269、ch was of the opinion that the preparation of such financial statements complied with the applicable accounting standards,the Listing Rules and legal requirements,and that adequate disclosures have been made.The AC considered that the existing proposed terms in relation to the appointment of the Gro

270、ups external auditors are fair and reasonable.CORPORATE GOVERNANCE REPORT 31ART GROUP HOLDINGS LIMITEDAnnual Report 2024REMUNERATION COMMITTEEWith specific written terms of reference,all members of the remuneration committee of the Company(the“RC”)are INEDs;namely,Mr.Kwan Chi Fai,Ms.Chong Sze Pui Jo

271、anne and Ms.Wang Yuqin.Mr.Kwan Chi Fai is the chairman of the RC.The RCs terms of reference are posted on the websites of the Company and the Stock Exchange.The role and function of the RC include making recommendations to the Board on the Companys policy and structure for all remuneration of key ex

272、ecutives of the Company,proposing their specific remuneration packages by considering factors such as salaries paid by comparable companies,time commitment and responsibilities of the Directors and the Companys performance and ensuring that no Director or any of his/her associate(s)is involved in de

273、ciding his/her own remuneration.The RC performs an advisory role to the Board,with the Board retaining the final authority to approve key executives remuneration.The RC should also review and/or approve matters relating to share schemes under Chapter 17 of the Listing Rules.The chairman of the RC re

274、ports the findings and recommendations of the RC to the Board after each meeting.During the year ended 30 June 2024,there were three RC meetings and the attendance of its members was as follows:Name of membersAttendanceMr.Kwan Chi Fai 3/3Ms.Chong Sze Pui Joanne3/3Ms.Wang Yuqin3/3The work performed b

275、y the RC during the year ended 30 June 2024 included the review of the remuneration policy for this financial year and the remuneration of the Executive Directors and the INEDs.CORPORATE GOVERNANCE REPORT 32ART GROUP HOLDINGS LIMITEDAnnual Report 2024NOMINATION COMMITTEEWith specific written terms o

276、f reference,all members of the nomination committee of the Company(the“NC”)are INEDs;namely,Mr.Kwan Chi Fai,Ms.Chong Sze Pui Joanne and Ms.Wang Yuqin.Mr.Kwan Chi Fai is the chairman of the NC.The NCs terms of reference are posted on the websites of the Company and the Stock Exchange.The role and fun

277、ction of the NC include:(a)to review the structure,size and composition(including the skills,knowledge,diversity and experience)of the Board at least annually and make recommendations to the Board regarding any proposed changes so as to complement the Companys corporate strategy;(b)to identify indiv

278、iduals suitably qualified to become Board members and select or make recommendations to the Board on the selection of individuals nominated for directorships with due regard for the benefits of diversity on the Board with reference to the Board diversity policy;(c)to make recommendations to the Boar

279、d on the appointment or re-appointment of Directors and succession planning for Directors in particular the chairman and the chief executive officer of the Company,taking into account the Companys corporate strategy and the mix of skills,knowledge,experience and diversity needed in the future,togeth

280、er with the Board,as appropriate;(d)to assess the independence of INEDs in accordance with the provisions of the Listing Rules and other relevant laws,rules and regulations;(e)to review the Diversity Policy,to develop and review measurable objectives for implementing the Diversity Policy and to moni

281、tor the progress on achieving these objectives;and(f)where the Board proposes a resolution to elect an individual as an INED at the general meeting,the NC should set out in the circular to shareholders and/or explanatory statement accompanying the notice of the relevant general meeting why they beli

282、eve he/she should be elected and the reasons why they consider him/her to be independent.The chairman of the NC reports the findings and recommendations of the NC to the Board after each meeting.During the year ended 30 June 2024,there were three NC meetings and the attendance of its members was as

283、follows:Name of membersAttendanceMr.Kwan Chi Fai3/3Ms.Chong Sze Pui Joanne3/3Ms.Wang Yuqin3/3CORPORATE GOVERNANCE REPORT 33ART GROUP HOLDINGS LIMITEDAnnual Report 2024NOMINATION COMMITTEE(Continued)The NC recommended that one Executive Director,Mr.Chen Jinyan and one INED,Ms.Chong Sze Pui Joanne,ret

284、iring by rotation at the annual general meeting(the“AGM”)held in November 2023,be re-elected.The NC made this recommendation for re-appointment based on their contributions to the Board and their firm commitment to their roles.The Board accepted the NCs recommendation and accordingly,the Executive D

285、irector and the INED above offered themselves for re-election at the AGM held in November 2023.The NC also considered the contribution of each Director to the effectiveness of the Board,reviewed the attendance and participation of the Directors at the Board and Board meetings.During the year ended 3

286、0 June 2024,the NC reviewed the structure,size,and diversity of the Board and the Board Diversity Policy so as to ensure that the Boards composition complies with the Listing Rules and reflects an appropriate mix of skills,experience,and diversity that are relevant to the Companys strategy,governanc

287、e,and business and contribute to the Boards effectiveness and efficiency.As at 30 June 2024,there were two female Directors in the Board which brought the female representation equal to one-third of the Board.The Board targets to maintain at least the current level of female representation,with the

288、ultimate goal of achieving gender parity.In considering the Boards succession,the NC would help identify potential candidates for INEDs,as and when appropriate.The Board will continue to take opportunities to increase the proportion of female members over time as and when suitable candidates are ide

289、ntified.Nomination PolicyThe NC recommends candidates for nomination to the Board,which approves the final choice of candidates.The NC is responsible to maintain the nomination policy of the Company(the“Nomination Policy”)and review the same regularly.The objective of the Nomination Policy is to ass

290、ist the Company in fulfilling its duties and responsibilities as provided in its terms of reference.This Nomination Policy sets out,inter alia,the selection criteria and the evaluation procedures in nominating candidates to be appointed or re-appointed as Directors of the Company.The NC shall consid

291、er any and all candidates recommended as nominees for Directors to the committee by any Directors or shareholders of the Company in accordance with its Articles of Association.The NC may also undertake its own search process for candidates and may retain the services of professional search firms or

292、other third parties to assist in identifying and evaluating potential nominees.The NC shall endeavour to find individuals of high integrity who possess the qualifications,qualities,skills,experience and independence(in case of INEDs)to effectively represent the best interests of all shareholders.Can

293、didates will be selected for their ability to exercise good judgment,and to provide practical insights and diverse perspectives.The NC may use any process it deems appropriate for the purpose of evaluating candidates including personal interviews,background checks,written submission by the candidate

294、s and third party references.As far as practicable,nominees for each election or appointment of Directors shall be evaluated using a substantially similar process.The NC shall review the Nomination Policy from time to time.CORPORATE GOVERNANCE REPORT 34ART GROUP HOLDINGS LIMITEDAnnual Report 2024AUD

295、ITORS SERVICES(a)Audit serviceThe fee for annual audit quoted by Elite Partners CPA Limited(“Elite Partners”)had been reviewed by the Board and the AC.For the year ended 30 June 2024,the auditors remuneration was HK$1,200,000.Elite Partners resigned as the auditor and Peng Sheng CPA Limited(“Peng Sh

296、eng”)was appointed as the auditor on 20 August 2024.Please refer to the announcement dated 20 August 2024 for more information in respect of the change of auditor.The fee for annual audit quoted by Peng Sheng had been reviewed by the Board and the AC.For the year ended 30 June 2024,the auditors remu

297、neration was HK$600,000.Peng Sheng resigned as the auditor and Confucius International CPA Limited(“CICPA”)was appointed as the auditor on 16 September 2024.Please refer to the announcement dated 16 September 2024 for more information in respect of the change of auditor.The fee for annual audit quot

298、ed by CICPA had been reviewed by the Board and the AC.For the year ended 30 June 2024,the auditors remuneration was HK$1,200,000.(b)Non-audit serviceThe fee charged by Elite Partners of interim review for the period ended 31 December 2023 was HK$280,000.Elite Partners reviewed the interim financial

299、statements.BOARD DIVERSITY POLICYThe Board and the NC adopted and approved the Diversity Policy for the purpose of supporting the attainment of strategic objectives and sustainable and balanced development of the Company.A summary of the Diversity Policy,together with the measureable objectives set

300、for implementing this policy,and the progress made towards achieving those objectives are disclosed as below.Measurable ObjectivesIn designing the Boards composition,all Board appointments will be based on merits,and candidates of the Board membership will be considered against objective criteria,in

301、cluding but not limited to,gender,age,cultural and educational background,ethnicity,professional experience,skills,knowledge and length of service,with due regard for the benefits of diversity on the Board.The Board believes that such meant-based appointments will be best enabled the Company to serv

302、e its shareholders.As at the date of this report,the Board comprised four male Directors and two female Directors which represent approximately 67%and 33%,respectively,of the total member of the Board,with different age,experience,background and diversity perspectives,which have been disclosed in bi

303、ographical details of Directors of this annual report.Monitoring and ReportingThe NC will report annually the composition of the Board in the Corporate Governance Report.The NC will also review the objectives of the Diversity Policy and closely monitor it in order to ensure the implementation of thi

304、s policy.Furthermore,the NC will discuss any revisions that may be required and recommend any such revisions to the Board for consideration and approval.CORPORATE GOVERNANCE REPORT 35ART GROUP HOLDINGS LIMITEDAnnual Report 2024BOARD DIVERSITY POLICY(Continued)Monitoring and Reporting(Continued)As at

305、 the date of this report,the Board comprised six Directors,three of them were INEDs,thereby promoting critical review and control of the management process.The Board is also characterised by significant diversity,whether considered in terms of gender,age,experience,cultural and educational backgroun

306、d,ethnicity,professional experience,skills,knowledge and length of service.DIVIDEND POLICYThe Company has in place of a dividend policy.Any declaration and payment of dividend shall be determined at the sole discretion of the Board with the long term objective of maximising shareholder value of the

307、Company.According to the dividend policy,in deciding whether to propose a dividend and in determining the dividend amount,the Board shall take into account,inter alia,the following factors:(a)operating and financial results;(b)cash flow situation;(c)business conditions and strategies;(d)future opera

308、tions and earnings;(e)taxation considerations;(f)capital requirements and expenditure plans;(g)interests of shareholders;(h)any restrictions on payment of dividends;and(l)any other factors that the Board may consider relevant.Such declaration and payment of the dividend by the Company is also subjec

309、t to any restrictions under the Companies Act of the Cayman Islands,any applicable laws,rules and regulations and the Articles of Association of the Company.Any declaration and payment of future dividends under the dividend policy are subject to the Boards determination that the same would be in the

310、 best interests of the Group and the shareholders of the Company as a whole.The Board will review the dividend policy from time to time and may exercise at its sole and absolute discretion to update,amend and/or modify the dividend policy at any time as it deems fit and necessary.There is no assuran

311、ce that dividends will be paid in any particular amount for any given period.CORPORATE GOVERNANCE REPORT 36ART GROUP HOLDINGS LIMITEDAnnual Report 2024COMMUNICATION WITH SHAREHOLDERSThe Board uses the AGM to communicate with shareholders and encourages their participation.At the AGM held in November

312、 2023,the Chairman proposed a separate resolution in respect of each substantially separate issue.The Chairman also arranged a member of the AC and the auditor to answer questions at the meeting.Moreover,the Company provides extensive information to its shareholders in its annual reports,interim rep

313、orts,announcements and circulars that are published on the websites of the Company and the Stock Exchange.Shareholders may at any time send their enquiries and concerns to the Board addressing to the Company Secretary of the Company by fax or by post to the Companys head office and principal place o

314、f business in Hong Kong as follows:Art Group Holdings LimitedUnit A,1st FloorYun Tat Commercial Building70-74 Wuhu StreetKowloon,Hong KongFax:+852 3106 6987COMPANY SECRETARYThe Company Secretary is Ms.Yeow Mee Mooi.The Company Secretary is an employee of the Company and has day to day knowledge of t

315、he Groups affairs.She reports to Chairman and Chief Executive Officer.The Board has access to the advice and service of the Company Secretary to ensure that the board procedures and all applicable laws,rules and regulations,are followed.She had taken not less than 15 hours of relevant professional t

316、raining during the year ended 30 June 2024 as required under Rule 3.29 of the Listing Rules.During the year ended 30 June 2024,Ms.Shum Ching Yee Jennifer was the Company Secretary for the period from 1 December 2023 to 23 January 2024.RIGHTS OF SHAREHOLDERS TO CONVENE AN EXTRAORDINARY GENERAL MEETIN

317、GPursuant to Article 58 of the Articles of Association of the Company,shareholder(s)holding at the date of deposit of the requisition not less than one-tenth of the paid up capital of the Company carrying the right of voting at general meetings of the Company shall at all times have the right,by wri

318、tten requisition to the Board or the Secretary of the Company deposited at the Companys head office and principal place of business in Hong Kong,to require an extraordinary general meeting to be called by the Board for the transaction of any business specified in such requisition;and such meeting sh

319、all be held within two months after the deposit of such requisition.If within twenty-one(21)days of such deposit the Board fails to proceed to convene such meeting the requisitionist(s)himself(themselves)may do so in the same manner,and all reasonable expenses incurred by the requisitionist(s)as a r

320、esult of the failure of the Board shall be reimbursed to the requisitionist(s)by the Company.CORPORATE GOVERNANCE REPORT 37ART GROUP HOLDINGS LIMITEDAnnual Report 2024VOTING BY POLLThe Articles of Association of the Company set out the procedures,requirements and circumstances where voting by poll i

321、s required.Pursuant to Rule 13.39 of the Listing Rules,any vote of shareholders at a general meeting must be taken by poll.The poll results will be published on the websites of the Stock Exchange and of the Company as soon as possible after conclusion of the general meeting,but in any event not late

322、r than the time that is 30 minutes before the earlier of the commencement of the morning trading session or any pre-opening session on the business day following the general meeting.CHANGES TO CONSTITUTIONAL DOCUMENTSThe Company has not made any amendments to its constitutional documents during the

323、year ended 30 June 2024.ENVIRONMENTAL,SOCIAL AND GOVERNANCE REPORT 38ART GROUP HOLDINGS LIMITEDAnnual Report 2024The Group is committed to the long term sustainability of the environment and communities in which it engages.Acting in an environmentally responsible manner,the Group endeavours to ident

324、ify and adopt effective measures to achieve efficient use of resources,energy saving and waste reduction.This report is prepared by the Group in compliance with the Environmental,Social and Governance(“ESG”)Reporting Guide(the“ESG Reporting Guide”)set out in Appendix C2 to the Listing Rules.This rep

325、ort complies with the“comply or explain”provisions set out in the ESG Reporting Guide for the year ended 30 June 2024 by making general disclosures on environmental and social information.The corporate governance is the key to effective ESG management.The Board assumes the overall ESG responsibility

326、 and is committed to strong ESG performance.The Board holds meetings to assess the ESG risks;formulate the ESG strategies and policies and ensure the establishment and maintenance of effective internal control procedures on the ESG aspects of its business and operations.The Board also regularly disc

327、usses with the management to check the execution of strategies and policies and collect feedback from the stakeholders.Independent assessment organisation was also engaged to further evaluate the environmental aspect of the Groups business and operations.With such governance structure,the Board can

328、effectively oversee ESG issues with both internal and external perspectives taken into consideration.The Group has adhered to the following reporting principles in its preparation of the report.Materiality:The Group has identified material ESG topics relevant to its development and operation through

329、 internal review and communication with stakeholders to understand their concerns and expectations.Quantitative:The Group accounts for and discloses key performance indicators(“KPIs”)in quantitative terms for proper evaluation of the effectiveness of ESG policies and actions.Balance:The report aims

330、to disclose data in an objective way,which aims to provide stakeholders with a balanced overview of the Groups overall ESG performances.Consistency:The Group adopts consistent measurement methodology to achieve meaningful comparison of ESG performances over time whenever practicable.Any updates in t

331、he methods or KPIs used will be disclosed.The Group further strengthened ESG reporting by expanding and prioritising group-wide efforts and activities on ESG.The Group is now reviewing,updating and refining its ESG-related issues in order to ensure the consistency of its policies,systems,processes a

332、nd standards with global best practice and trends.As the ESG rating and disclosure guidelines evolve,the Groups disclosures will be followed accordingly.THE BOARD STATEMENTThe board of directors(the“Board”)believes that good environmental conditions,social impact and governance structure are importa

333、nt to the Groups development.The Group should have a long-term strategic management mission and firmly believes that the positive realization of ESG is the cornerstone of sustainable development.In order to achieve the Groups commitment to long-term operation and sustainable development,the Group adopts different guidance and monitoring system to ensure the operation is efficient and minimise the