ARTGROUPHOLD：INTERIMREPORT2022.pdf

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1、中期報告 2022INTERIM REPORT 2022(Incorporated in the Cayman Islands with limited liability)(Stock Code:565)ART GROUP HOLDINGS LIMITED1ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Corporate InformationBOARD OF DIRECTORSMr.Chen Jinyan(Chairman)Mr.Chen Jindong(Chief Executive Officer)Mr.Kwan Chi Fai*Mr.Lin

2、 Ye*(retired on 15 October 2022)Ms.Chong Sze Pui Joanne*Ms.Wang Yuqin*Independent Non-executive DirectorCOMPANY SECRETARYMs.Yeow Mee MooiAUDITORElite Partners CPA LimitedHEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS IN HONG KONGUnit 1407,14th Floor,China Merchants TowerShun Tak Centre168-200 Connaught

3、 Road Central,Hong KongWebsite:http:/.hkREGISTERED OFFICE3rd Floor,Century YardCricket SquareP.O.Box 902Grand Cayman KY1-1103Cayman IslandsPRINCIPAL SHARE REGISTRAR ANDTRANSFER OFFICETricor Services(Cayman Islands)Limited3rd Floor,Century YardCricket SquareP.O.Box 902Grand Cayman KY1-1103Cayman Isla

4、ndsHONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICETricor Investor Services Limited17th Floor,Far East Finance Centre16 Harcourt RoadHong KongPRINCIPAL BANKERSIndustrial and Commercial Bank of ChinaChina Construction BankBank of ZhengzhouBank of ChinaHang Seng BankSHARE LISTINGThe Stock Exchange

5、 of Hong Kong Limited(Stock code:565)2ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Report on Review of Condensed Consolidated Financial StatementsTO THE BOARD OF DIRECTORS OF ART GROUP HOLDINGS LIMITED錦藝集團控股有限公司(incorporated in the Cayman Islands with limited liability)IntroductionWe have reviewed t

6、he condensed consolidated financial statements of Art Group Holdings Limited(the“Company”)and its subsidiaries(collectively referred to as the“Group”)set out on pages 4 to 35,which comprise the condensed consolidated statement of financial position as of 31 December 2022 and the related condensed co

7、nsolidated statement of profit or loss and other comprehensive income,condensed consolidated statement of changes in equity and condensed consolidated statement of cash flows for the six-month period then ended,and certain explanatory notes.The Rules Governing the Listing of Securities on The Stock

8、Exchange of Hong Kong Limited require the preparation of a report on interim financial information to be in compliance with the relevant provisions thereof and Hong Kong Accounting Standard 34“Interim Financial Reporting”(“HKAS 34”)issued by the Hong Kong Institute of Certified Public Accountants(th

9、e“HKICPA”).The directors of the Company are responsible for the preparation and presentation of these condensed consolidated financial statements in accordance with HKAS 34.Our responsibility is to express a conclusion on these condensed consolidated financial statements based on our review,and to r

10、eport our conclusion solely to you,as a body,in accordance with our agreed terms of engagement,and for no other purpose.We do not assume responsibility towards or accept liability to any other person for the contents of this report.Scope of reviewWe conducted our review in accordance with Hong Kong

11、Standard on Review Engagements 2410“Review of Interim Financial Information Performed by the Independent Auditor of the Entity”issued by the HKICPA.A review of these condensed consolidated financial statements consists of making inquiries,primarily of persons responsible for financial and accounting

12、 matters,and applying analytical and other review procedures.A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be

13、identified in an audit.Accordingly,we do not express an audit opinion.3ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022ConclusionBased on our review,nothing has come to our attention that causes us to believe that the condensed consolidated financial statements are not prepared,in all material respects

14、,in accordance with HKAS 34.Elite Partners CPA LimitedCertified Public AccountantsMs.Chow Ka LiPractising Certificate number:P0780910th Floor 8 Observatory RoadTsim Sha Tsui,Kowloon,Hong Kong 28 February 20234ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022The board of directors(the“Board”)of Art Group

15、 Holdings Limited(the“Company”)is pleased to announce the unaudited condensed consolidated financial statements of the Company and its subsidiaries(together,the“Group”)for the six months ended 31 December 2022(the“Period”),which were reviewed by the auditor and the audit committee of the Company,tog

16、ether with the comparative figures for the corresponding period in 2021 are as follows:Condensed Consolidated Statement of Profit or Loss and Other Comprehensive IncomeFor the six months ended 31 December 2022Six months ended31 December20222021(unaudited)(unaudited)NOTESHK$000HK$000Continuing operat

17、ionsRevenue374,78894,447Cost of sales(18,662)(18,321)Gross profit56,12676,126Other income17,59920,815Administrative expenses(13,067)(11,446)Impairment loss on rental deposits(35,788)Impairment loss on loan receivable(28,866)Loss on fair value changes on investment properties(483,146)(3,614)Finance c

18、osts4(22,275)(23,661)(Loss)/profit before taxation(509,417)58,220Income tax credit/(expense)5118,266(13,760)(Loss)/profit for the period from continuing operations6(391,151)44,460Discontinued operationLoss for the period from discontinued operation8(10,476)(Loss)/profit for the period(391,151)33,984

19、5ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Other comprehensive(expense)/income:Items that will not be reclassified to profit or lossExchange differences on translation from functional currency to presentation currency(40,982)21,846Other comprehensive(expense)/income for the period,net of income t

20、ax(40,982)21,846Total comprehensive(expense)/income for the period(432,133)55,830(Loss)/profit for the period attributable to owners of the Company:From continuing operations(391,151)35,734 From discontinued operation(10,263)(Loss)/profit for the period attributable to owners of the Company(391,151)

21、25,471Profit for the period attributable to non-controlling interests:From continuing operations8,726 From discontinued operation(213)Profit for the period attributable to non-controlling interests8,513(391,151)33,984Condensed Consolidated Statement of Profit or Loss and Other Comprehensive IncomeFo

22、r the six months ended 31 December 2022Six months ended31 December20222021(unaudited)(unaudited)HK$000HK$0006ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Total comprehensive(expense)/income for the period attributable to:Owners of the Company(432,133)45,161 Non-controlling interests10,669(432,133)55

23、,830Total comprehensive(expense)/income for the period attributable to owners of the Company:From continuing operations(432,133)55,803 From discontinued operation(10,642)(432,133)45,161(LOSS)/EARNINGS PER SHARE9From continuing and discontinued operationsBasic(HK cents)(14.55)0.95Diluted(HK cents)(14

24、.55)0.95From continuing operationsBasic(HK cents)(14.55)1.33Diluted(HK cents)(14.55)1.33From discontinued operationBasic(HK cents)(0.38)Diluted(HK cents)(0.38)Condensed Consolidated Statement of Profit or Loss and Other Comprehensive IncomeFor the six months ended 31 December 2022Six months ended31

25、December20222021(unaudited)(unaudited)NOTESHK$000HK$0007ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Condensed Consolidated Statement of Financial PositionAs at 31 December 202231 December30 June20222022NOTESHK$000HK$000(unaudited)(audited)NON-CURRENT ASSETSProperty,plant and equipment3,5623,786Righ

26、t-of-use assets4,6045,336Investment properties101,292,0451,843,529Rental deposits146,862186,6231,447,0732,039,274CURRENT ASSETSTrade and other receivables1139,85522,949Loan receivable12163,572213,709Bank balances and cash9,29821,526212,725258,184CURRENT LIABILITIESOther payables1362,40043,656Contrac

27、t liabilities5,5599,881Lease liabilities1492,86288,808Amount due to a substantial shareholder1,61747,496Bonds1515,34115,341Tax liabilities2,2082,621179,987207,803NET CURRENT ASSETS32,73850,381TOTAL ASSETS LESS CURRENT LIABILITIES1,479,8112,089,6558ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022CAPITAL

28、 AND RESERVESShare capital1626,88826,888Reserves553,403985,536TOTAL EQUITY580,2911,012,424NON-CURRENT LIABILITIESLease liabilities14837,150887,292Deferred tax liabilities51,360179,936Bonds1511,01010,003899,5201,077,2311,479,8112,089,655Condensed Consolidated Statement of Financial PositionAs at 31 D

29、ecember 202231 December30 June20222022NOTESHK$000HK$000(unaudited)(audited)9ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Condensed Consolidated Statement of Changes In EquityFor the six months ended 31 December 2022Attributable to owners of the CompanySharecapitalSharepremiumMergerreserveExchange re

30、serveShare option reserveStatutory reserveRetained profitsSub-totalNon-controlling interestsTotalHK$000HK$000HK$000HK$000HK$000HK$000HK$000HK$000HK$000HK$000As at 1 July 2021(audited)26,888263,850136(597)21,9188781,041,4781,354,551160,2071,514,758Profit for the period25,47125,4718,51333,984Other com

31、prehensive income for the period Exchange difference on translation from functional currency to presentation currency19,69019,6902,15621,846Total comprehensive income for the period19,69025,47145,16110,66955,830Appropriations367(367)Acquisition of non-controlling interests without a change in contro

32、l773773(183,213)(182,440)Disposal of subsidiaries1,649(1,649)12,33712,337Forfeiture of share options under employee share option scheme(5,557)5,557As at 31 December 2021(unaudited)26,888263,85013620,74216,3611,2451,071,2631,400,4851,400,485As at 1 July 2022(audited)26,88848,746136(30,072)5,5571,2329

33、59,9371,012,4241,012,424Loss for the period(391,151)(391,151)(391,151)Other comprehensive expense for the period Exchange difference on translation from functional currency to presentation currency(40,982)(40,982)(40,982)Total comprehensive expense for the period(40,982)(391,151)(432,133)(432,133)Fo

34、rfeiture of share options under employee share option scheme(155)155As at 31 December 2022(unaudited)26,88848,746136(71,054)5,4021,232568,941580,291580,29110ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Condensed Consolidated Statement of Cash FlowsFor the six months ended 31 December 2022Six months

35、ended December 3120222021HK$000HK$000(unaudited)(unaudited)Net cash generated from operating activities21,294336,216Cash flows from investing activitiesPurchases of property,plant and equipment(4,632)Purchase of right-of-use assets(4,308)Advance to loan receivable(259,036)Repayment from loan receiva

36、ble22,472307,229Interest received173,372Net cash outflow from disposal of subsidiaries(46)Net cash generated from investing activities22,48942,579Cash flows from financing activitiesAcquisition of non-controlling interests without a change in control(182,440)Advance from a substantial shareholder3,4

37、82Repayment to a substantial shareholder(48,569)(21,460)Repayments of lease liabilities(489)(546)Repayments of bond(9,000)Interest paid(9,863)(88)Net cash used in financing activities(55,439)(213,534)Net(decrease)/increase in cash and cash equivalents(11,656)165,261Effect of foreign exchange rate ch

38、anges(572)6,738Cash and cash equivalents at the beginning of the period21,52616,693Cash and cash equivalents at the end of the period,represented by bank balances and cash9,298188,69211ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Notes to the Condensed Consolidated Financial StatementsFor the six mo

39、nths ended 31 December 20221.BASIS OF PREPARATIONThe condensed consolidated financial statements have been prepared in accordance with the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and with Hong Kong

40、Accounting Standard(“HKAS”)34“Interim Financial Reporting”issued by the Hong Kong Institute of Certificated Public Accountants(the“HKICPA”).2.PRINCIPAL ACCOUNTING POLICIESThe condensed consolidated financial statements have been prepared on the historical cost basis except for certain investment pro

41、perties that are measured at fair values.Other than additional accounting policies resulting from application of amendments to Hong Kong Financial Reporting Standards(“HKFRSs”),the accounting policies and methods of computation used in the condensed consolidated financial statements for the six mont

42、hs ended 31 December 2022 are the same as those presented in the Groups annual consolidated financial statements for the year ended 30 June 2022.Application of amendments to HKFRSsIn the current interim period,the Group has applied,for the first time,the following new and amendments to HKFRSs issued

43、 by the HKICPA which are mandatorily effective for the annual period beginning on or after 1 July 2022 for the preparation of the Groups condensed consolidated financial statements:Amendments to HKFRS 3Reference to the Conceptual FrameworkAmendments to HKAS 16Property,Plant and Equipment Proceeds be

44、fore Intended UseAmendments to HKAS 37Onerous Contracts Cost of Fulfilling a ContractAmendments to HKFRSsAnnual Improvements to HKFRSs 2018-2020The application of the above amendments to HKFRSs in the current interim period has had no material effect on the Groups condensed consolidated financial st

45、atements and/or disclosures set out in these condensed consolidated financial statements.12ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20223.REVENUE AND SEGMENT INFORMATIONRevenue represents(i)the lease payments received and receivable in the normal course of business,net of related taxes for the year;

46、and(ii)property management and related services fee received and receivable.Six months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)Continuing operationsRevenue from major business services:Revenue within the scope of HKFRS 16Rental income from leasing of properties30,65737,407Revenue

47、from contracts with customers within the scope of HKFRS 15Property management fee income43,44155,293Property management other related services6901,74744,13157,04074,78894,447Disaggregated by timing of revenue recognition:Over time:Property management fee income43,44155,293Property management other r

48、elated services6901,74744,13157,040 13ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20223.REVENUE AND SEGMENT INFORMATION(Continued)Performance obligations for revenue from contracts with customers(i)Property management feeProperty management fee is recognised over the service period.The Group receives m

49、onthly property management fee payments from customers one to three months in advance under the contracts.Advance consideration allocated to the properties management services is recognised as a contract liability and is released over the period of services.Segment informationInformation reported to

50、 the board of directors,being the chief operating decision maker(the“CODM”),for the purpose of resources allocation and assessment of segment performance focuses on types of goods or services delivered or provided.Prior to the period ended 30 June 2022,the management of the Company has determined th

51、at the Group has two operating segments as the Group is engaged in the property operating and biotechnology businesses,which is the basis used by the CODM.From a product perspective,the management assesses the performance from property operating and biotechnology segments.During the period ended 31

52、December 2021,the biotechnology segment was discontinued due to the disposal of relevant subsidiaries.Subsequent to the discontinuation of the biotechnology segment,there is only one single reportable segment for the Group,which is the property operating segment operated in the Peoples Republic of C

53、hina(the“PRC”).The segment information reported does not include any amounts for this discontinued operation,which is described in details in note 8.Segment results represent profit or loss from the segment without allocation of income tax credit/(expense),loan interest income,impairment loss on loa

54、n receivable and unallocated administrative expenses.14ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20223.REVENUE AND SEGMENT INFORMATION(Continued)Segment information(Continued)One single tenant from property operating segment contributed to 10 per cent or more of the Groups revenue for the six months

55、ended 31 December 2022(six months ended 31 December 2021:One).The total amount of revenue from this tenant was HK$10,830,000(six months ended 31 December 2021:HK$17,272,000).The CODM assesses the performance of the property operating segment based on sales and net profit.The CODM makes decisions acc

56、ording to operating results of each segment.No analysis of segment asset and segment liability is presented as the CODM does not regularly review such information for the purpose of resources allocation and performance assessment.Therefore,only segment revenue and segment results are presented.Six m

57、onths ended 31 December 2022Property operatingContinuing operationsHK$000Revenue74,788Segment result(483,471)Income tax credit118,266Loan interest income8,967Impairment loss on loan receivable(28,866)Unallocated administration expenses(6,047)Loss for the period from continuing operations(391,151)15A

58、RT GROUP HOLDINGS LIMITEDINTERIM REPORT 20223.REVENUE AND SEGMENT INFORMATION(Continued)Segment information(Continued)Six months ended 31 December 2022Property operatingUnallocatedTotalContinuing operationsHK$000HK$000HK$000Amounts included in the measure of segment profit or lossInterest income1611

59、7Interest expenses(21,226)(1,049)(22,275)Loss on fair value changes of investment properties(483,146)(483,146)Amounts regularly provided to the CODM but not included in the measure of segment profit or lossDepreciation of property,plant and equipment(91)(2)(93)Depreciation of right-of-use assets(99)

60、(493)(592)16ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20223.REVENUE AND SEGMENT INFORMATION(Continued)Segment information(Continued)Six months ended 31 December 2021Property operatingContinuing operationsHK$000Revenue94,447Segment result55,041Income tax expense(13,760)Loan interest income11,288Unallo

61、cated administration expenses(8,109)Profit for the period from continuing operations44,46017ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20223.REVENUE AND SEGMENT INFORMATION(Continued)Segment information(Continued)Six months ended 31 December 2021Property operatingUnallocatedTotalContinuing operationsH

62、K$000HK$000HK$000Amounts included in the measure of segment profit or lossInterest income2,8613073,168Interest expenses(22,563)(1,098)(23,661)Loss on fair value changes of investment properties(3,614)(3,614)Amounts regularly provided to the CODM but not included in the measure of segment profit or l

63、ossDepreciation of property,plant and equipment(37)(37)Depreciation of right-of-use assets(583)(583)Additions to non-current assets8,9401,97110,911No geographical market analysis is provided as the Groups revenue and contribution to segment results were substantially derived from the tenants in the

64、PRC and the assets are substantially located in the PRC.18ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20224.FINANCE COSTSSix months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)Continuing operationsInterest on Bonds1,0061,072 Lease liabilities21,26922,58922,27523,6615.INCOME TAX CREDIT/(E

65、XPENSE)Six months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)Continuing operationsIncome tax recognised in profit and lossPRC Enterprise Income Tax(“EIT”)Current income tax2,52114,664Deferred tax(120,787)(904)(118,266)13,76019ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20225.INCOME TAX

66、CREDIT/(EXPENSE)(Continued)Hong Kong Profits Tax was calculated at 16.5%(six months ended 31 December 2021:16.5%)of the estimated assessable profit for the Period.No provision for Hong Kong Profits Tax has been made in the condensed consolidated financial statements as the Group did not generate any

67、 assessable profits arising in Hong Kong for both periods.Under the Law of the PRC on EIT(the“EIT Law”)and Implementation Regulation of the EIT Law,the tax rate of the PRC subsidiaries was 25%for both periods.During the six months ended 31 December 2022,no deferred tax liabilities(30 June 2022:Nil)w

68、ere recognised in respect of the undistributed retained earnings of the PRC subsidiaries attributable to the Group under the EIT Law that are subject to withholding tax upon the distribution of such profits to the shareholders outside the PRC.6.(LOSS)/PROFIT FOR THE PERIOD FROM CONTINUING OPERATIONS

69、Six months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)Continuing operationsProfit for the period has been arrived at after charging:Depreciation of property,plant and equipment9337Depreciation of right-of-use assets598583Expenses related to short-term leases in respect of rented prem

70、ises51Exchange losses,net2,7244587.DIVIDENDSNo dividends were paid,declared or proposed during the interim period nor has any dividend been proposed since the end of the interim period(six months ended 31 December 2021:Nil).20ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20228.DISCONTINUED OPERATIONDurin

71、g the period ended 31 December 2021,the Group entered into a sale and purchase agreement to dispose of its 100%equity interests in City Charm International Limited and its subsidiaries(the“Disposal Group”)that carried out all of the Groups biotechnology operation.The disposal was completed on 22 Nov

72、ember 2021,on which date the Group lost control of the Disposal Group.The Groups biotechnology operation is treated as discontinued operation.The loss for the period ended 31 December 2021 from the discontinued biotechnology operation in the PRC is set out below.The comparative figures in the conden

73、sed consolidated statement of profit or loss and other comprehensive income have been restated to re-present the biotechnology operation in the PRC as a discontinued operation.Six months ended 31 December2021HK$000(unaudited)Loss of biotechnology operation in the PRC for the period1,305Loss on dispo

74、sal of biotechnology operation in the PRC9,17110,47621ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20228.DISCONTINUED OPERATION(Continued)The results of the biotechnology operation in the PRC for the preceding interim period were as follows:Period ended 22 November 2021HK$000(unaudited)RevenueCost of sa

75、lesGross profitOther income243Administrative expenses(1,394)Finance costs(154)Loss before taxation(1,305)Income tax expenseLoss for the period(1,305)22ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20228.DISCONTINUED OPERATION(Continued)The net assets of the Disposal Group as at the date of disposal were

76、as follows:HK$000(unaudited)Loss on disposal of a subsidiary:Total consideration*Less:Net assets disposed of3,166Add:Non-controlling interest(12,337)Loss on disposal(9,171)Total consideration satisfied by:Cash consideration received*Net cash outflow arising on disposal:Cash consideration received*Ba

77、nk balances and cash disposed of(46)Net cash outflow(46)Cash flows from the Disposal Group:Period ended 22 November 2021HK$000(unaudited)Net cash flows from operating activities31,002Net cash flows from investing activitiesNet cash flows from financing activities(31,030)Net cash flows(28)*less than

78、HK$1,00023ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20229.(LOSS)/EARNINGS PER SHAREFrom continuing operations and discontinued operationThe calculation of the basic and diluted(loss)/earnings per share from continuing operations and discontinued operation attributable to the owners of the Company is

79、based on the following data:Six months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)(Loss)/earnings(Loss)/profit for the period attributable to the owners of the Company for the purposes of basic and diluted(loss)/earnings per share(391,151)25,471Six months ended 31 December20222021000

80、000(unaudited)(unaudited)Number of sharesWeighted average number of ordinary shares for the purpose of basic earnings per share2,688,8052,688,805Effect of dilutive potential ordinary shares in respect of share options issued by the Company3941,930Weighted average number of ordinary shares for the pu

81、rpose of diluted earnings per share2,689,1992,690,73524ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20229.(LOSS)/EARNINGS PER SHARE(Continued)From continuing operationsThe calculation of the basic and diluted(loss)/earnings per share from continuing operations attributable to the owners of the Company i

82、s based on the following data:Six months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)(Loss)/earnings(Loss)/profit for the period of calculating basic and diluted(loss)/earnings per share from continuing operations(391,151)35,734Six months ended 31 December20222021000000(unaudited)(una

83、udited)Number of sharesWeighted average number of ordinary shares for the purpose of basic earnings per share2,688,8052,688,805Effect of dilutive potential ordinary shares in respect of share options issued by the Company3941,930Weighted average number of ordinary shares for the purpose of diluted e

84、arnings per share2,689,1992,690,73525ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20229.(LOSS)/EARNINGS PER SHARE(Continued)From discontinued operationBasic loss per share for the discontinued operation for the six months ended 31 December 2021 was HK0.38 cents per share and diluted loss per share for t

85、he discontinued operation was HK0.38 cents per share,based on the loss for the period from the discontinued operation of approximately HK$10,263,000 and the denominators detailed above for both basic and diluted loss per share.10.INVESTMENT PROPERTIESThe Group leases the shopping mall from landlord

86、and sub-leases out retail store to other third parties under operating leases with rentals payable monthly/quarterly.Such shopping malls are initially recognized as right-of-use assets included in the financial line item“Investment properties”at cost in accordance with HKFRS 16.Subsequently,they are

87、 measured at fair value in accordance with HKAS 40.The leases typically run for an initial period of 30 days to 20 years.Majority of the lease contracts contain market review clauses in the event the lessee exercises the option to extend.The Group is not exposed to foreign currency risk as a result

88、of the lease arrangements,as all leases are denominated in the respective functional currency of group entities.The lease contracts do not contain residual value guarantee and/or lessees option to purchase the property at the end of lease term.31 December30 June20222022HK000HK000(unaudited)(audited)

89、Fair valueBalance at the beginning of the period/year1,843,5292,050,602Loss on fair value changes on investment properties(483,146)(162,651)Exchange realignment(68,338)(44,422)Balance at the end of the period/year1,292,0451,843,52926ART GROUP HOLDINGS LIMITEDINTERIM REPORT 202210.INVESTMENT PROPERTI

90、ES(Continued)The fair value of the Groups investment properties as at 31 December 2022 and 30 June 2022 has been arrived at on the basis of a valuation carried out at the end of the year by International Valuation Limited(the“Valuer”),an independent qualified professional valuer not connected with t

91、he Group.The Valuer has appropriate qualifications and recent experiences in the valuation of similar properties in the relevant locations.The Groups investment properties were valued individually,on market value basis,which conforms to Hong Kong Institute of Surveyors Valuation Standards.The fair v

92、alue was arrived at by reference to comparable sales transactions available in the relevant market together with income approach by capitalising the net rental income derived from the existing tenancies under various terms.The Group as lessorProperty rental income,management fee income and operating

93、 service income earned during the period were HK$74,788,000(six months ended 31 December 2021:HK$94,447,000).All properties have committed tenants of which the remaining lease period ranged from the next 30 days to 12 years and include an extension option.At the end of the reporting period,the Group

94、 had contracted with tenants for the following future minimum lease payments:31 December30 June20222022HK000HK000(unaudited)(audited)Within one year63,21066,050In the second to fifth years inclusive159,977170,753Over five years188,111200,788411,298437,59127ART GROUP HOLDINGS LIMITEDINTERIM REPORT 20

95、2211.TRADE AND OTHER RECEIVABLES31 December30 June20222022HK000HK000(unaudited)(audited)Trade receivables19,33911,036Prepayment1,6361,185Other receivables18,88010,72839,85522,949As at 31 December 2022 and 30 June 2022,all trade receivables of the Group were in the functional currency of the relevant

96、 group entities.The following is an aged analysis of trade receivables presented based on the date of rendering of services:31 December30 June20222022HK000HK000(unaudited)(audited)0-60 days9,4247,19661-90 days1,5331,449Over 90 days8,3822,39119,33911,03628ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022

97、11.TRADE AND OTHER RECEIVABLES(Continued)The Group measures loss allowances for trade receivables at an amount equal to lifetime expected credit losses(“ECL”),which is assessed individually.Given the Group has not experienced any significant credit losses in the past and holds rental deposits from t

98、enants to cover potential exposure to credit risk,the allowance for ECL is insignificant.Before accepting any new tenants,the Group assesses the potential tenants credit quality.49%(30 June 2022:65%)of trade receivables that are neither past due nor impaired have good credit rating under internal cr

99、edit assessment adopted by the Group.12.LOAN RECEIVABLE31 December30 June20222022HK000HK000(unaudited)(audited)Gross carrying amount of loan and interest receivable,net of exchange difference241,831264,507Less:Provision for impairment loss(78,259)(50,798)163,572213,709On 28 April 2021,the Group ente

100、red into an agreement with an independent third party A(the“Borrower A”)to borrow RMB250,000,000(equivalent to HK$294,118,000).The amount was interest-bearing at 7.500%per annum and due on 27 April 2022.The amount was secured by 25%equity interests of Zhengzhou Jiachao Property Services Co.,Ltd.*(“Z

101、hengzhou Jiachao”)and 25%equity interests of Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co.,Ltd.*(“Zhongyuan Jinyi”)both held by a former non-controlling shareholder of a subsidiary over loan receivable.Loan receivable is fully guaranteed by a former non-controlling shareholder of a s

102、ubsidiary of the Group.*For identification only29ART GROUP HOLDINGS LIMITEDINTERIM REPORT 202212.LOAN RECEIVABLE(Continued)On 19 November 2021,the Group entered into the first supplemental agreement with the Borrower A,the existing guarantor and a new guarantor.Pursuant to which,the principal amount

103、 of loan receivable was revised from RMB250,000,000(equivalent to HK$294,118,000)to RMB210,000,000(equivalent to HK$253,012,000)and the share charged over the 25%equity interests of Zhongyuan Jinyi held by a former non-controlling shareholder of a subsidiary was released.In addition,the Group receiv

104、ed RMB40,000,000(equivalent to HK$48,193,000)of principal and the interest receivables remained outstanding.On 29 June 2022,the Group and the Borrower A entered into the second supplemental agreement to(i)extend the maturity date of loan receivable and agree to repay the outstanding into three insta

105、lments.The last instalment will be due on 27 April 2023;and(ii)revise the interest rate of loan receivable to 4.785%per annum effective from 28 April 2022 and up to and including 27 April 2023.As at 31 December 2022,loan receivable with gross principal amount of HK$209,484,000(30 June 2022:HK$240,40

106、7,000)in aggregate and related gross interest receivables of HK$32,347,000(30 June 2022:HK$24,100,000)were due from the Borrower A.This loan is interest-bearing at a rate of 4.785%(30 June 2022:4.785%)per annum and was repayable within twelve months from the end of the reporting period and therefore

107、 was classified as current assets as at 31 December 2022.The effective interest rate is 7.50%(31 December 2021:7.50%)per annum.As at 31 December 2022,the Group held collateral of 25%equity interests of Zhengzhou Jiachao,a former subsidiary of the Company(30 June 2022:25%equity interests of Zhengzhou

108、 Jiachao held by a former non-controlling shareholder of a subsidiary)over loan receivable with gross principal amount of HK$209,484,000(30 June 2022:HK$240,407,000)and interest receivable of HK$32,347,000(30 June 2022:HK$24,100,000).Loan receivable is fully guaranteed by a former non-controlling sh

109、areholder of a subsidiary and an independent third party of the Group.Impairment loss of HK$28,866,000(30 June 2022:HK$51,551,000)has been recognised in the condensed consolidated statement of profit or loss and other comprehensive income for the six months ended 31 December 2022.30ART GROUP HOLDING

110、S LIMITEDINTERIM REPORT 202212.LOAN RECEIVABLE(Continued)The principal amount of RMB90,000,000(equivalent to HK$102,273,000)has matured subsequent to the reporting period but not yet settled up to the date of this report.Loan receivable is denominated in RMB,the functional currency of the relevant g

111、roup entities.The movements in the ECL for loan receivable are as follows:Stage 112m ECLStage 2Lifetime ECL(not credit-impaired)TotalHK$000HK$000HK$000As at 1 July 2021471471ECL recognised for the year51,55151,551Transfer to lifetime ECL(not credit-impaired)(471)471Exchange realignment(1,224)(1,224)

112、As at 30 June 202250,79850,798ECL recognised for the period28,86628,866Exchange realignment(1,405)(1,405)As at 31 December 202278,25978,25931ART GROUP HOLDINGS LIMITEDINTERIM REPORT 202212.LOAN RECEIVABLE(Continued)Reconciliation of gross carrying amount for loan receivable and interest receivable f

113、or the six months ended 31 December 2022 and the year ended 30 June 2022 are as follow:31 December30 June20222022HK000HK000As at 1 July 2021/30 June 2022(audited)264,507305,165New loan originated259,036Repayment(22,472)(307,229)Interest receivable8,96720,924Interest received(204)Modification loss(6,

114、812)Exchange realignment(9,171)(6,373)As at 31 December 2022(unaudited)241,831264,50713.OTHER PAYABLES31 December30 June20222022HK000HK000(unaudited)(audited)Receipts in advance30,64811,339Deposits received from tenants27,08327,488Accrued charges and other payables4,6664,814Dividend payable31562,400

115、43,65632ART GROUP HOLDINGS LIMITEDINTERIM REPORT 202214.LEASE LIABILITIESThe exposure of the Groups lease liabilities are as follows:31 December30 June20222022HK000HK000(unaudited)(audited)Current92,86288,808Non-current837,150887,292930,012976,100 within one year92,86288,808 more than one year but n

116、ot more than two years76,24379,197 more than two years but not more than five years217,855221,894 more than five years543,052586,201930,012976,100Amounts due for settlement within one year(shown under current liabilities)(92,862)(88,808)Amounts due for settlement after one year(shown under non-curre

117、nt liabilities)837,150887,292The weighted average incremental borrowing rates applied to lease liabilities from 4.71%to 8.45%(30 June 2022:4.71%to 8.45%).33ART GROUP HOLDINGS LIMITEDINTERIM REPORT 202215.BONDSOn 13 August 2014,the Company issued two unlisted and non-transferable bonds at face value

118、of HK$5,340,000 and HK$10,000,000 to two independent third parties.The bonds are interest bearing at 8.00%per annum,unsecured and repayable on the seventh and half anniversary of the respective date of issue.The bonds were initially recognised at HK$15,309,000 and subsequently measured at amortised

119、cost using the effective interest method.The effective interest rate is 8.05%(six months ended 31 December 2021:8.05%)per annum.The bonds were extended for one year pursuant to the supplemental deed dated 28 December 2021.The bonds were further extended for one year pursuant to the supplemental deed

120、 dated 6 February 2023.Subsequent to the current reporting period,the bond of HK$5,340,000 was fully settled up to the date of this report.On 8 August 2018 and 29 August 2018,the Company issued two unlisted and non-transferable bonds at face value of HK$7,000,000 and HK$3,000,000 to an independent t

121、hird party.The bonds are interest bearing at 8.00%per annum,unsecured and repayable on the seventh and half anniversary of the respective date of issue.The bonds were initially recognised at HK$10,000,000 and subsequently measured at amortised cost using the effective interest method.The effective i

122、nterest rate is 8.00%(six months ended December 2021:8.00%)per annum.On 1 August 2019,the Company issued unlisted and non-transferable bond at face value of HK$9,000,000 to an independent third party.The bond is interest bearing at 8.00%(six months ended December 2021:8.00%)per annum,unsecured and r

123、epayable on the second anniversary of the respective date of issue.The bond was initially recognised at HK$9,000,000 and subsequently measured at amortised cost using the effective interest method.The bond was fully settled during the year ended 30 June 2022.34ART GROUP HOLDINGS LIMITEDINTERIM REPOR

124、T 202215.BONDS(Continued)The movements of the liability component of the Groups bonds during the six months ended 31 December 2022 are as follows:HK$000As at 30 June 2021(audited)34,352Repayment of bond(9,000)Effective interest charged for the year2,080Coupon interest paid/payable(2,088)As at 30 Jun

125、e 2022 and 1 July 2022(audited)25,344Effective interest charged for the period1,007As at 31 December 2022(unaudited)26,35116.SHARE CAPITAL31 December30 June20222022HK000HK000(unaudited)(audited)Authorised:5,000,000,000 ordinary shares with HK$0.01 each50,00050,000Issued and fully paid:2,688,805,163

126、ordinary shares with HK$0.01 each26,88826,88835ART GROUP HOLDINGS LIMITEDINTERIM REPORT 202217.SHARE-BASED PAYMENTSThe Company adopts a share option scheme for eligible participants,including directors and employees of the Group and other participants.Details of the share options granted to the dire

127、ctors and employees of the Group outstanding during the period are as follows:Number of share options20222021000000Outstanding as at 1 July(audited)28,930111,560Granted during the periodExercised during the periodForfeited during the period(2,080)(28,930)Outstanding as at 31 December(unaudited)26,85

128、082,63018.RELATED PARTY TRANSACTIONSThe remuneration of directors and other members of key management during the period was as follows:Six months ended 31 December20222021HK$000HK$000(unaudited)(unaudited)Salaries and other benefits1,7901,969Retirement benefit scheme contributions24181,8141,987The r

129、emuneration of directors is determined by the remuneration committee of the Company having regard to the performance of individuals and market trends.19.EVENT AFTER THE REPORTING PERIODSaved as disclosed in elsewhere of this condensed consolidated financial statements,there are no other significant

130、events after the reporting period that are required to be reported.36ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Management Discussion and AnalysisOPERATIONAL 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

131、(Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co.,Ltd.)(“Zhongyuan Jinyi”)in the PRC.The principal activity of Zhongyuan Jinyi is property operating business.During the six months ended 31 December 2021,the Company acquired 25%equity interests of Zhongyuan Jinyi.After completion,Zhongyu

132、an Jinyi became an indirect wholly-owned subsidiary of the Company.Please refer to the announcement dated 15 November 2021 for details.Zhongyuan Jinyi leased the Jiachaos Shopping Mall with a rental period to expire in the mid of 2036,comprises the whole of a 4-storey shopping mall built over one le

133、vel of basement commercial space with a gross floor area of approximately 125,188 square meters,situated in Zhengzhou City,Henan Province,the PRC.The Group generates revenue from the monthly incomes of rental,management and operating service receivables from tenants under the respective tenancy agre

134、ements with a remaining term ranging from one year to 12 years.The Jiachaos Shopping Mall is a one-stop shopping paradise that offers a wide range of services and goods including shopping,dining and entertainment,such as a renowned department store,a cinema,a supermarket,KTV(a karaoke box),jewelries

135、,beauty shops,electrical appliances shops,international labels for fashion,fitness,lifestyle,casual wear/sport,kids paradise,kids learning and restaurants.Approximately 98.9%of the lettable area in the Jiachaos Shopping Mall was rented out to approximately 134 tenants as at 31 December 2022.Certain

136、area of the Jiachaos Shopping Mall is rented to tenants on short-term leases for use including kiosks and booths of trendy and stylish items.In addition,Zhongyuan Jinyi leased the Zone C Shopping Mall,a 5-storey integrated commercial mall built over one level of basement commercial space with a gros

137、s floor area of approximately 80,118 square meters,situated in Zhengzhou City,from a real estate developer with a rental period to expire in the mid of 2036.The Zone C Shopping Mall is a shopping mall located adjacent to the Jiachaos Shopping Mall.Zhongyuan Jinyi promoted and further rented out the

138、Zone C Shopping Mall to various independent tenants under the respective tenancy agreements with a remaining term ranging from one year to eight years.As at 31 December 2022,approximately 91.1%of the lettable area of the Zone C Shopping Mall had been leased out as retail shops,restaurants and/or for

139、 entertainment and leisure use which offers a wide range of services and goods with approximately 105 tenants including a cinema,an aquarium,jewelries,beauty shops,car sales,international labels for fashion,fitness,lifestyle,casual wear/sport,kids paradise,kids learning and restaurants.Certain area

140、of the Zone C Shopping Mall is rented to tenants on short-term leases for use including kiosks and booths of trendy and stylish items.37ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022Zhongyuan Jinyi has an advantage of having an existing team of caliber and experienced management and staff to run the

141、two shopping malls together.As such,the extra costs for running the shopping malls are minimal to Zhongyuan Jinyi while it is earning considerable amount of incomes from renting out shopping malls to tenants.The Board believes that the larger the area for shopping,the more the number of similar type

142、s of shops opened,which may in turn attract more customers by offering them a large diversity of and well-known brand choices.The management of both the Jiachaos Shopping Mall and the Zone C Shopping Mall by Zhongyuan Jinyi will bring positive benefits and synergy effects on the customer flow and th

143、e tenant grade to the Group,which eventually contributes to revenue and profit margin of the property operating business of the Group.During the six months ended 31 December 2021,the Group disposed of the biotechnology segment in Honghezhou,Yunnan Province,the PRC;of which the Company held 60%equity

144、 interests in this segment.As no production approval license of cannabidiol(“CBD”)was granted from the PRC regulatory body,the commercial production had not yet been commenced since its set-up in 2019,the Board determined to discontinue the operation of this segment in order to stop incurring furthe

145、r costs.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 Co.,Ltd.),an independent third party,(the“Borrower”)pursuant to which,it was agreed to lend to the Borrower a loan in the principal

146、 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 revised to RMB210 million,as well as the interest of 4.785%per annum.The Group will focus its resources on property operating business

147、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 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 a

148、nd repayment ability of the Borrower and its guarantors.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 Bor

149、rower and 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 guar

150、antors;and(iv)conducted updated background and corporate searches of the Borrower and the guarantors.As at 28 February 2023,the Group had not received the second payment of the Renewed Loan of RMB90 million,which became due on 31 January 2023.Please also refer to the announcements of the Company dat

151、ed 28 April 2021,13 May 2021,19 November 2021,27 May 2022,29 June 2022 and 23 February 2023,as well as the circular of the Company dated 12 August 2022 for details.38ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022The COVID-19 epidemic spreads across the globe starting from the beginning of 2020,since

152、then,the situation around the world continues to change rapidly.The Board agrees that the Groups business has been impacted by the closure of the shopping malls and controls of the epidemic to a significant extent during the Period.The Group had supported more than 235 tenants(2021:15 tenants)of the

153、 Jiachaos Shopping Mall and the Zone C Shopping Mall(including kiosks 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 throughout the Period with an aggregated amount of approximately HK$32,6

154、34,000(2021:HK$1,031,000).The Group sees cost reduction as a key strategic focus to help navigate business uncertainty resulting from the COVID-19 epidemic.The Group also focuses on protecting and advancing the interests of tenants and customers in these difficult times,whilst prioritising the safet

155、y and well-being of its employees and business partners.Continuing OperationsRevenueFor the Period,the Group recorded a revenue of approximately HK$74,788,000(2021:HK$94,447,000),approximately 20.8%less than that in 2021.Revenue of the Group included the monthly income of rental,management and opera

156、ting services received and receivable from the tenants of the Jiachaos Shopping Mall and the Zone C Shopping Mall.Decrease in revenue during the Period was due to a reduction of rental,management and operating service charges granted to more than 235 tenants of the Jiachaos Shopping Mall and the Zon

157、e C Shopping Mall(including kiosks and booths of trendy and stylish items)who were affected by the epidemic(2021:15 tenants)on different bases with an aggregated amount of approximately HK$32,634,000(2021:HK$1,031,000).Gross ProfitThe gross profit margin was approximately 75.0%for the Period(2021:80

158、.6%).Property operating segment has simple costs of sales due to its business nature,such 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

159、.Decrease in gross profit margin was due to decrease in revenue as a result of a reduction of rental,management and operating service charges granted to more than 235 tenants of the Jiachaos Shopping Mall and the Zone C Shopping Mall who were affected by the epidemic during the Period.39ART GROUP HO

160、LDINGS LIMITEDINTERIM REPORT 2022Loss for the PeriodThe Groups loss incurred for the Period was approximately HK$391,151,000(profit in 2021:HK$44,460,000).The loss margin was 523.0%for the Period(profit margin in 2021:47.1%).Both decreased significantly for the six months ended 31 December 2022 main

161、ly because of a substantial decrease in fair value of the Groups investment properties,the Jiachaos Shopping Mall and the Zone C Shopping Mall,of approximately HK$483,146,000(2021:HK$3,614,000)as a consequence of mandatory closure of the two shopping malls due to the COVID-19 epidemic regulatory pol

162、icies for the period from October to November 2022.Other IncomeOther income for the six months ended 31 December 2022 was approximately HK$17,599,000(2021:HK$20,815,000),which comprised other kinds of incomes generated from property operating segment,such as car parking fees and other services provi

163、ded to tenants.Decrease in other income was due to mandatory closure of the Jiachaos Shopping Mall and the Zone C Shopping Mall as a result of the COVID-19 epidemic regulatory policies for the period from October to November 2022.ExpensesAdministrative expenses amounted to approximately HK$13,067,00

164、0(2021:HK$11,446,000),representing approximately 17.5%(2021:12.1%)of revenue for the six months ended 31 December 2022.Administrative expenses increased by approximately 14.2%mainly because there was a depreciation of RMB,the functional currency of the Company,during the Period.Impairment loss on lo

165、an receivable amounted to approximately HK$28,866,000(2021:Nil)for the Period.The material increase was because the loan had been extended one more year after its initial maturity date on 27 April 2022,which in turn increased its credit risk to a certain extent.The impairment loss was estimated base

166、d on the expected credit loss(“ECL”)assessment prepared by an independent valuer engaged by the Group.The ECL of loan receivable was estimated with three parameters,namely Exposure at Default(“EAD”),Probability of Default(“PD”),and Loss Given Default(“LGD”).40ART GROUP HOLDINGS LIMITEDINTERIM REPORT

167、 2022EAD is based on the discounted loan receivable at amortised cost of the Group.PD is estimated with reference to the credit rating analysis of the Borrower and the latest financial performance of the Borrower,and further adjusted with the forward-looking factor.The valuer concluded that the cred

168、it rating of the Borrower for the six months ended 31 December 2022 was worse than that for the six months ended 31 December 2021,based on the credit rating analysis of the Borrower with consistent method across the period.LGD is calculated by one minus recovery rate,where the recovery rate is based

169、 on the value of collateral-to-loan ratio.The fair value of the collateral provided by the guarantor based on the loan agreement was adopted to estimate the recovery rate in case the Borrower defaults.Impairment loss on rental deposits amounted to approximately HK$35,788,000(2021:Nil)for the Period.

170、The impairment loss was estimated based on the ECL assessment prepared by an independent valuer engaged by the Group.The material increase was mainly due to the seizure of some shops by certain banks and financial institutions to whom the Jiachaos Shopping Mall and the Zone C Shopping Mall were pled

171、ged by their respective owner,which in turn increased the credit risk to a certain extent.Nevertheless,the two shopping malls,including the subject shops,operated normally as at the date of reporting.The carrying value of the Groups investment properties,the Jiachaos Shopping Mall and the Zone C Sho

172、pping Mall,as at 31 December 2022 of approximately HK$1,292,045,000(30 June 2022:HK$1,843,529,000)was stated at fair value based on an independent valuation as at that date,which produced a loss on fair value changes of investment properties of approximately HK$483,146,000(2021:HK$3,614,000).This lo

173、ss on fair value changes of investment properties mainly reflected a less flourishing rental growth of the investment properties.The attributable net loss on fair value changes on investment properties of approximately HK$362,360,000(2021:HK$2,711,000),after deducting related deferred tax liabilitie

174、s,was debited to the condensed consolidated income statement.Decrease in the carrying value was due to the COVID-19 epidemic spreading across the globe since the beginning of 2020,causing the carrying value of the investment properties continue to drop.In 2022,COVID-19 pandemic was across China,it r

175、educed the consumption growth.As a result,the commercial rental performance decreased.Since the end of December 2022,the consumer market has shown signs of recovery,and the passenger flow of physical businesses has rebounded.The directors believe the carrying value should improve in 2023.Finance cos

176、ts amounted to approximately HK$22,275,000(2021:HK$23,661,000),representing approximately 29.8%(2021:25.1%)of revenue for the six months ended 31 December 2022.Finance costs were maintained at the similar level for the six months ended 31 December 2021 and 31 December 2022.41ART GROUP HOLDINGS LIMIT

177、EDINTERIM REPORT 2022DividendThe Board does not recommend the payment of an interim dividend for the Period(2021:Nil).Discontinued OperationLoss for the PeriodThe discontinued operation had no revenue and loss for the Period because the biotechnology segment was disposed of during the six months end

178、ed 31 December 2021.Loss for the six months ended 31 December 2021 from discontinued operation was approximately HK$10,476,000 and no revenue was generated because no CBD production approval license was granted from the PRC regulatory body.Thus the commercial production had not yet been commenced.FU

179、TURE PLANS AND PROSPECTSIn view of achieving the best interests of the Company and its shareholders as a whole,the Group has been putting effort in enlarging its operations of property operating business.Substantial resources have been placed into property operating business to explore future prospe

180、cts and develop relevant markets.Thus,the Group acquired 25%equity interests in Zhongyuan Jinyi during the six months ended 31 December 2021 so as to increase the flexibility and efficiency in the management,decision-making and long-term strategy formulation by wholly owned the principal operating s

181、ubsidiary,with a view to enhance the Groups development and to maximise the shareholders return by focusing on property operating aspect.The Group targets to engage in the provision of rental,management and operating services to more tenants of different kinds of shopping malls in various locations.

182、Therefore,Zhongyuan Jinyi had entered into the tenancy agreements with each of the landlords of the Jiachaos Shopping Mall and the Zone C Shopping Mall.The Group will persist to upgrade the tenants of the two shopping malls by offering tenancies to more popular brands and diversify the types of tena

183、nts to meet the needs and interests of customers from different ages and backgrounds.To achieve these aims,the Group conducts large scale marketing and promotion activities,so that a stable and constant stream of income and fairly consistent cash flow can be continuously generated to the Group.The G

184、roup will continue to deploy its resources on the property operating business including but not limited to(i)recruit more candidates with high-caliber and experience in property operating business;(ii)explore suitable shopping malls/properties of similar size and scale to the Jiachaos Shopping Mall

185、and the Zone C Shopping Mall to expand the Groups property management and operating portfolio;and(iii)possible merger and acquisition of asset-light property operating business in the PRC so as to strengthen the Groups property operating team and further expand the Groups property management and ope

186、rating portfolio.42ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022The world keeps changing during the time of the epidemic.This poses a tremendous challenge to the Group.Nevertheless,the Group has been striving to use all of its resources on hand flexibly to cope with the difficulties.Extra prudence i

187、s needed in these unprecedented times and the post-pandemic period.The Group can help support their tenants both now and over the long-term by increasing promotion activities to raise the popularity of the shopping malls,paying close attention to their business operations,providing policies of assis

188、tance for key merchants and following closely with market trends and government-related policies in real time in order to make appropriate management decisions in a timely manner.By leveraging on the Groups current strategic plan and established strengths,experience and foresight,the Group continues

189、 to seize opportunities to penetrate into different areas of the property operating market,explore other new market potential and increase profit margin.Moreover,the Group intends to manage and operate the property operating segment by the current caliber management and competent employees of its su

190、bsidiaries.Simultaneously,the Group continues to implement conservative and stringent cost control policies in order 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 st

191、rengthening accounts receivable management.In addition,adapting to a new normal,corporate resilience is essential to harness new opportunities while recovering quickly from unprecedented shocks during the post-pandemic period.The PRC Government started to lift lockdowns and relax control restriction

192、s at the beginning of 2023.The Board believes that the reopen will bring positive effects in the economic resurgence in the coming year.The demand for goods and services will recover and a surge in prices will accelerate;especially household consumption.The sales and customer flow of the shopping ma

193、lls will gradually restore in the future.The confidence of tenants increases with this anticipated steady growth;hence the Group will no longer need to provide rental reduction to the tenants.Looking forward,the Group continues to place additional resources to realise growth momentum from the develo

194、pment of property operating market.The Jiachaos Shopping Mall and the Zone C Shopping Mall are situated in Zhengzhou City,the centre and one of the Regional Central Cities of the PRC,and with good economic and demographic fundamentals,which enables the Group to diversify its business operations into

195、 the property operating market in depth.The business growth of the Group is expected to accelerate and accordingly,the positive outcome will be gradually reflected in the future along with continuing development of the Belt and Road Initiative and the Internal/External Circular Economy that advocate

196、d by the PRC government,as well as the effectiveness of the Regional Comprehensive Economic Partnership from January 2022.By continually capturing opportunities for expansion and diversifying the Groups business,the market value of the Company and the return to its shareholders will be maximised in

197、long-term.43ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022LIQUIDITY AND FINANCIAL RESOURCESAs at 31 December 2022,the Group had net current assets and total assets less current liabilities of approximately HK$32,738,000(30 June 2022:HK$50,381,000)and HK$1,479,811,000(30 June 2022:HK$2,089,655,000),re

198、spectively.The Group had maintained its financial position by financing its operations with the proceeds from the disposal of a PRC subsidiary,internally generated resources and bonds.As at 31 December 2022,the Group had cash and bank deposits of approximately HK$9,298,000(30 June 2022:HK$21,526,000

199、).The current ratio of the Group was approximately 118.2%(30 June 2022:124.2%).Total equity of the Group as at 31 December 2022 was approximately HK$580,291,000(30 June 2022:HK$1,012,424,000).As at 31 December 2022,four bonds(30 June 2022:four bonds)measured at amortised cost was approximately HK$26

200、,351,000(30 June 2022:HK$25,344,000)in aggregate,the gross debt gearing ratio(i.e.bonds/shareholders fund)was approximately 4.5%(30 June 2022:2.5%).Though the return of funds has slowed down since 2020 as a result of the COVID-19 epidemic,the Group still has maintained and will continue to maintain

201、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 a substantial shareholder of the Company in meeting its short-term and long-term obligations.FINANC

202、INGAs at 31 December 2022,the Group had no borrowing facilities(30 June 2022:Nil).In addition,four bonds(30 June 2022:four bonds)amounted to approximately HK$26,351,000(30 June 2022:HK$25,344,000)in aggregate,measured at amortised cost,were arranged with three(30 June 2022:three)independent third pa

203、rties.The Board believes that the existing financial resources will be sufficient to meet future expansion plans and,if necessary,the Group will be able to obtain additional financing with favourable term.CAPITAL STRUCTUREAs at 31 December 2022,the share capital of the Company comprised ordinary sha

204、res only.FOREIGN EXCHANGE RISK AND INTEREST RATE RISKDuring the six months ended 31 December 2022,the Group was not subject to any significant exposure to foreign exchange rates risk as the majority of its transactions were denominated in RMB.Hence,no financial instrument for hedging was employed.44

205、ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022The Board monitors interest rate change exposure and may consider a hedging policy should the need arise.CHARGE ON GROUPS ASSETSAs at 31 December 2022,the Group did not pledge any assets to any banks or financial institutions(30 June 2022:Nil).STAFF POLIC

206、YThe Group had 141 employees altogether in the PRC and Hong Kong as at 31 December 2022.The Group offers a comprehensive and competitive remuneration,retirement scheme and benefit package to its employees.Discretionary bonus is offered to the Groups staff depending on their performance.The Group is

207、required to make contribution to a social insurance scheme in the PRC.Moreover,the Group and its employees in the PRC are required to make respective contribution to fund the endowment insurance,unemployment insurance,medical insurance,employees compensation insurance and birth insurance(for employe

208、rs only)at the rates specified in the relevant PRC laws and regulations.The Group has adopted a provident fund scheme as required under the Mandatory Provident Fund Schemes Ordinance(Chapter 485 of the Laws of Hong Kong)for its employees in Hong Kong.The Group also provides periodic internal trainin

209、g to its employees.Three independent non-executive directors are appointed by the Company for a term of one year commencing from 11 April,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

210、 contingent liabilities.45ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022DIRECTORS INTERESTS IN SHARES AND UNDERLYING SHARESAs at 31 December 2022,the interests of the directors and their associates in the shares and underlying shares of the Company and its associated corporations,as recorded in the r

211、egister 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 Limited(the“Stock Exchange”)pursuant to the Model Code for Securities Transaction

212、s by Directors of Listed Issuers,were as follows:Long positionsOrdinary shares of HK$0.01 each of the CompanyName of directorCapacityNumberof issuedordinaryshares heldPercentage ofthe issuedshare capitalof the CompanyMr.Chen JindongHeld by his spouse(Note 1)369,100,00013.73%Mr.Chen JinyanBeneficial

213、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 entire issued share capital of which is beneficially owned by the spouse of Mr.Chen

214、 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 Limited,a company incorporated in the BVI,the entire issued share capital of whi

215、ch 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 their associates had any interest or short positions in any shares or underlying

216、 shares of the Company or any of its associated corporations as at 31 December 2022.46ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022ARRANGEMENT TO PURCHASE SHARES OR DEBENTURESSave as disclosed under the section headed“Share options”below,at no time during the Period was the Company,its holding compa

217、ny,or any of its subsidiaries,a party to any arrangements to enable the directors of the Company to acquire benefits by means of acquisition of shares in,or debentures of,the Company or any other body corporate.DIRECTORS INTERESTS IN CONTRACTS OF SIGNIFICANCENo contract of significance,to which the

218、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 Period or at any time during the Period.SUBSTANTIAL SHAREHOLDERSAs at 31 December 2022,the register of substant

219、ial shareholders maintained by the Company pursuant to Section 336 of the SFO shows that other than the interests disclosed in the section headed“Directors interests in shares and underlying shares”above,the following shareholders had notified the Company of relevant interests in the issued share ca

220、pital of the Company.Long positions Ordinary shares of HK$0.01 each of the CompanyName of shareholderCapacityNumber ofissued ordinaryshares heldPercentage ofthe issuedshare capitalof the CompanyMs.Lin LinBeneficial owner and interest in a controlled corporation369,100,00013.73%Mr.Chen JinqingBenefic

221、ial owner and interest in a controlled corporation(Note)188,315,0007.00%Dresdner VPV N.V.Investment manager139,755,2005.20%Note:Among the 188,315,000 shares,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

222、 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.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

223、 Company as at 31 December 2022.47ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022SHARE OPTIONSThe Companys share option scheme(the“Share Option Scheme”)became effective on 22 November 2013.Particulars of the Share Option Scheme are set out in note 31 to the consolidated financial statements of the Com

224、panys 2022 annual report.The following table disclosed movements in the Companys share options during the Period:GranteeDate of grantExercise periodExercisePriceOutstandingat1.7.2022Grantedduringthe PeriodExercisedduringthe PeriodForfeitedduringthe PeriodLapsedduringthe PeriodOutstandingat31.12.2022

225、HK$DirectorsMr.Lin Ye22.5.201422.5.2014 to 21.5.20240.1662,080,000(2,080,000)Employees15.1.201815.1.2018 to 14.1.20280.43026,850,00026,850,000Granted Total28,930,000(2,080,000)26,850,000PURCHASE,SALE OR REDEMPTION OF THE COMPANYS LISTED SECURITIESDuring the Period,neither the Company nor any of its

226、subsidiaries purchased,sold or redeemed any of the Companys listed securities.CODE ON CORPORATE GOVERNANCEThe Company is committed to achieving the best corporate governance practices as a listed company.The Board believes that high standards and rigorous corporate governance practices can improve t

227、he accountability and transparency of the Company.Consequently,during the Period,the Company complied with the Corporate Governance Code contained in Appendix 14 of the Rules Governing the Listing of Securities on the Stock Exchange(the“Listing Rules”).MODEL CODE FOR SECURITIES TRANSACTIONS BY DIREC

228、TORS OF LISTED ISSUERSThe Group has adopted the Model Code set out in Appendix 10 of the Listing Rules as the code of conduct regarding directors securities transactions.All directors of the Company have confirmed that they have complied with the required standard set out in the Model Code throughou

229、t the Period.48ART GROUP HOLDINGS LIMITEDINTERIM REPORT 2022AUDIT COMMITTEEThe audit committee of the Company comprises three independent non-executive directors of the Company.The principal duties of the audit committee include the review of the Groups financial reporting procedures,risk management

230、 and internal control and financial results.The audit committee has reviewed with the management and the external auditor the accounting principles and practices adopted by the Group and discussed auditing and financial reporting matters including the review of the unaudited condensed consolidated interim financial statements of the Group for the Period.By order of the BoardChen JinyanChairmanHong Kong28 February 2023