Hopefluent Group Holdings Limited
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(Inc0rp0rated in the Cayman Islands with limited liability) Stock C0de: 733
20
AN N UAL RE
Contents
2 Corporate Information
3 Financial Highlights
4 Year in Review
6 Chairman's Statement
9 Biographical Details of Directors & Senior Management
12 Management Discussion and Analysis
18 Corporate Governance Report
29 Directors' Report
39 Environmental, Social and Governance Report
52 Independent Auditor's Report
57 Consolidated Statement of Profit or Loss and Other Comprehensive Income
58 Consolidated Statement of Financial Position
60 Consolidated Statement of Changes in Equity
61 Consolidated Statement of Cash Flows
63 Notes to the Consolidated Financial Statements
124 Financial Summary
Corporate Information
BOARD OF DIRECTORS
Executive Directors
Mr. FU Wai Chung (Chairman)
Mr. LO Yat Fung
Non-Executive Directors
Mr. FU Ear Ly
Mr. LI Bo
Mr. LI Fuqiang
Independent Non-Executive Directors
Mr. LAM King Pui Mr. CAO Qimeng Ms. XU Jing
MEMBERS OF AUDIT COMMITTEE
Mr. LAM King Pui (Chairman)
Mr. CAO Qimeng
Ms. XU Jing
MEMBERS OF REMUNERATION COMMITTEE
Mr. LAM King Pui (Chairman)
Mr. CAO Qimeng
Ms. XU Jing
MEMBERS OF NOMINATION COMMITTEE
Mr. FU Wai Chung (Chairman)
Mr. FU Ear Ly Mr. LAM King Pui Mr. CAO Qimeng Ms. XU Jing
COMPANY SECRETARY
Mr. LO Hang Fong, solicitor, Hong Kong
AUTHORISED REPRESENTATIVES
Mr. FU Wai Chung
Mr. LO Yat Fung
REGISTERED OFFICE
Cricket Square
Hutchins Drive
P.O. Box 2681
Grand Cayman KY1-1111
Cayman Islands
HEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS
9-10/F, One Bravo 1 Jinsui Road Zhujiang New Town
Tianhe District, Guangzhou
People's Republic of China (the "PRC")
PLACE OF BUSINESS IN HONG KONG
Room 1302, 13th Floor Shun Tak Centre West Tower 200 Connaught Road Central Hong Kong
AUDITOR
BDO Limited
Certified Public Accountants and Registered Public Interest Entity Auditor
25th Floor, Wing On Centre 111 Connaught Road Central Hong Kong
LEGAL ADVISERS
Guantao & Chow Solicitors and Notaries Suites 1801-3, 18/F, One Taikoo Place 979 King's Road, Quarry Bay
Hong Kong
PRINCIPAL BANKERS
Industrial and Commercial Bank of China 1/F, Citic Plaza
233 Tian He Bei Road Guangzhou, PRC
PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE
Suntera (Cayman) Limited
3rd Floor, Royal Bank House 24 Shedden Road, George Town Grand Cayman KY1-1110 Cayman Islands
HONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICE
Tricor Investor Services Limited 17/F
2 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Far East Finance Centre 16 Harcourt Road Hong Kong
STOCK CODE
733
WEBSITE
https://www.hopefluent.com
Shareholders' Funds
(HK$'000)
3,479,216
946,673
96
068
0
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000 4,000,000
2024
1,279,
2023
1,603,889
2022
2,227,8
2021
2,
2020
Financial Highlights
Turnover by Business
For the year ended 31st December
2%
3%
2024
2023
98%
97%
Property real estate agency
Financial services
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 3
Year in ReviewThe Group serves more than 40 cities. Currently, the Group has become the close partner of renowned developers such as Vanke, Yuexiu, Poly, China Resources Land, China Railway Group, China Railway Construction, China Green Town, Jinmao, Citic, Kingold, China Merchants Property Development, KWG Property, Logan, Country Garden, Huafa and Gemdale. The Group is continuing its efforts to expand its customer base and services and secure more agency projects in different regions, reinforcing its leading position in China's property service market.
4 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Year in Review
In 2024, the property agency services will continue to be the core business of the Group. Given the prevalence of internet technology, the Group has integrated mobile network and online services with its traditional service so as to improve the operational mode of the industry and create room for sustainable development, thus ultimately providing more comprehensive services to
customers.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 5
Chairman StatementFU WAI CHUNG
Chairman
In 2024, the real estate market in Mainland China continued to be in an adjustment phase, and real estate development across the country remained under pressure. According to data from the National Bureau of Statistics, the sales area and sales value of commercial properties fell by 12.9% and 17.1%, respectively, in 2024, indicating a low level of trading activity in the market. To stabilize the market, the government introduced a series of policies, including optimizing purchase and loan restrictions, reducing the down payment ratio, and supporting the rigid and improvement-oriented housing demand. These measures, together with the promotion of the trade-in policy and the continuous reduction of mortgage interest rates, injected some vitality into the market. In addition, the implementation of special loan policies to ensure the delivery of pre-sold housing projects was strengthened in many places, which boosted the confidence of home buyers and promoted trading activity in the second-hand housing market.
These policies demonstrate the government's determination to revitalize the industry and the overall economy. They have also created new business opportunities for enterprises and set higher standards for their service capabilities and professionalism. Faced with challenges during the market adjustment period, the Group actively adapted its strategy and strived to seize the opportunities in a bearish market.
6 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
In 2024, the Group's overall turnover was HK$947 million, a decline of HK$27% from the same period in 2023, mainly due to the overall downturn in the real estate market and intense competition in the property real estate agency industry during the year, which resulted in operating losses. The loss attributable to shareholders was HK$280 million.
Chairman StatementFocusing on the core business of property real estate agency, digital transformation to guide growth, and diversified business to advance in tandem
Over the past year, the Group has made steady progress in various business areas and proactively responded to market challenges. In terms of property real estate agency services, the Group made targeted adjustments to boost business performance through comprehensive business assessments, in-depth analysis of market data and customer feedback. At the same time, the Group actively
promoted digital transformation and utilized new media and Internet marketing to expand its brand influence and achieve business
growth. For example, the Group upgraded its online property search service platform "AI Hopefluent" to the "Bang Housing" APP and mini program, integrating online and offline resources and providing a full-process shopping guide service. The platform cooperates with a leading Internet company to promote technological innovation in real estate services. As of 2024, "Bang Housing" has covered more than 70 cities across the country, with the number of users exceeding eight million, thus further consolidating its leading position in the industry.
In addition, leveraging years of operational experience and close cooperation with a number of outstanding companies, the Group has gained in-depth and extensive knowledge of industry information and market trends, which has continuously improved the performance of the valuation research business. During the year, the Group provided customers with a variety of services such as strategic consulting, data research, and value and risk assessment, and was committed to exploring the application of new technologies to enhance its sales performance.
As the domestic economy slowed and the real estate industry remained sluggish amid weak market demand, the Group was inevitably affected by the dual impact of the macroeconomic environment and industry trends. During the year, the property real estate agency business recorded a turnover of approximately HK$924 million (2023: approximately HK$1,251 million).
The Group's financial services business was also affected by severe volatility in the external environment and the tightening market atmosphere. The turnover of this business was approximately HK$23 million (2023: approximately HK$44 million).
CONCLUSION
Over the years, although the market was complex and volatile, "challenges" and "opportunities" have always coexisted. With the support and promotion of various national policies, the real estate market is expected to gradually regain its vitality and stability, and the industry will become healthier and more sustainable.
In 2025, Hopefluent will meet the challenges and opportunities of the new era with a more open attitude and more professional services. The Group will respond to market volatility with flexible strategies, continue to improve operational efficiency, ensure steady progress and strive for breakthroughs in the face of industry changes to create a better future together with all parties.
On behalf of the Group and the Board of Directors, I would like to express my gratitude to all Hopefluent employees for their contributions. I would also like to sincerely thank our shareholders, customers, business partners and investors for their continued support and trust in the Group. Hopefluent will continue to work diligently and strive to achieve a turnaround as soon as possible, create greater value for customers, and bring more satisfactory returns to shareholders.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 7
Comprehensive Networks in PRCLli
Urumqi
Beijing
Tianjin
Yantai
Jining Binzhou
Tongling Chizhou
Fuyang
Hefei
Nanjing
Suzhou
Hangzhou
Suqian
Shaoxing
Sichuan
Qingyuan
Nanning
Guangzhou
Foshan
Huizhou Dongguan
Shenzhen
Jiangmen
Zhongshan
Headquarters
South China Sea
8 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Biographical Details of Directors & Senior Management
DIRECTORS
Executive Directors
Mr. Fu Wai Chung ("Mr. Fu"), aged 75, the co-founder and chairman of the Group, is responsible for the strategic planning and overall management of the Group. Mr. Fu is a graduate of 華南工學院 (Wahnan Industrial College, the PRC) and holds a certificate in mechanical engineering. Mr. Fu has over 30 years of experience in real estate agency business management and administration in the PRC.
Mr. Lo Yat Fung, aged 60, is a certified public accountant in Hong Kong and has over 30 years of experience in accounting and financial management. Mr. Lo holds a Master of Science degree in Sustainable Urban Development from the University of Oxford. He is a fellow member of the Institute of Chartered Accountants in England and Wales and the Hong Kong Institute of Certified Public Accountants.
Non-Executive Directors
Mr. Fu Ear Ly, aged 40, is responsible for overseeing the Group's overall development strategic and business planning. Mr. Fu Ear Ly graduated from Bentley University in the United States with a Bachelor's degree in Finance and has over 10 years of experience in real estate investment business. Mr. Fu Ear Ly is the son of Mr. Fu.
Mr. Li Bo, aged 41, is the deputy general manager of the financial management center of Country Garden Life Services Group Co., Ltd. (碧桂園生活服務集團股份有限公司) ("CGLS"), a company established in the People's Republic of China since August 2023. He joined Country Garden Holdings Company Limited (a company listed on the main board of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") with stock code: 2007) since July 2007. Mr. Li Bo graduated from Xi'an Jiaotong University in July 2007 with a bachelor's degree in accounting.
Mr. Li Fuqiang, aged 48, is currently the general manager of the legal and internal control department of CGLS. Mr. Li Fuqiang has been practicing law since 1999 and possesses extensive experience as a lawyer. Mr. Li Fuqiang has worked for large real estate companies for over twenty years, accumulating extensive experience in corporate legal affairs and investment risk control. Mr. Li Fuqiang holds a bachelor's degree in economic law from Jiangxi University of Science and Technology and is qualified as a lawyer in the People's Republic of China in 2000.
Independent Non-Executive Directors
Mr. Lam King Pui, aged 59, is a chief accountant of a Hong Kong company and company secretary of several Hong Kong companies. He holds a Bachelor of Arts degree in accountancy from the Hong Kong Polytechnic University and has over 30 years of experience in accounting. Mr. Lam is a fellow member of the Association of Chartered Certified Accountants, a Certified Public Accountant, an associate member of the Hong Kong Institute of Certified Public Accountants and an associate member of the Hong Kong Chartered Governance Institute.
Mr. Cao Qimeng, aged 42, holds an Executive Master of Business Administration degree from Fudan University and has over 15 years of experience in the financial industry. Mr. Cao is currently the general manager of Top Set China (上海致上投資咨詢有限公司). Mr. Cao had experience of working in international investment bank. Mr. Cao has working experience in Mainland China, Hong Kong, Singapore and New York.
Ms. Xu Jing, aged 39, holds a bachelor degree in business administration (finance) from Carnegie Mellon University in the United States and has about 10 years of experience in real estate and investment industry. Ms. Xu is currently the vice chairman of a property developer in China, leading project research and investment decisions.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 9
Biographical Details of Directors & Senior ManagementAUDIT COMMITTEE
The Company established an audit committee on 24th June, 2004. The primary duties of the audit committee are to review and supervise the financial reporting process and risk management and internal control systems of the Group. The audit committee has reviewed the audited financial statements for the year ended 31st December, 2024.
As at the date of the annual report, the audit committee of the Group consists of three independent non-executive directors, namely
Mr. Lam King Pui, Mr. Cao Qimeng and Ms. Xu Jing. Mr. Lam King Pui was appointed as the chairman of the audit committee.
SENIOR MANAGEMENT
Mr. Liang Guo Hong, aged 59, is the financial controller and is responsible for the financial management of the Group. Mr. Liang holds a diploma in business administration from the Guangzhou Finance and Trading Management College, the PRC (廣州市財貿管理幹部學院) and a bachelor's degree in construction engineering from the Military Engineering College, the PRC (中國工程兵工程學院).
Ms. Yang Xiaojia, aged 38, is the manager of the administration department and is responsible for the administration and human resources of the Group. Ms. Yang holds a bachelor's degree in economics from Beijing Technology and Business University, the PRC (中國北京工商大學), and a master's degree in law from the University of East Anglia in United Kingdom.
Mr. Zheng Songjie, aged 47, is the deputy general manager of the Group and is responsible for formulation of development strategies and overall business management for primary property agency business of the Group. Mr. Zheng holds a bachelor's degree in business administration from the Guangdong Commercial College, the PRC (廣東商學院).
Mr. Xie Yu Han, aged 60, is the deputy general manager and is responsible for market research and analysis, property projects development planning and management of related information services. Mr. Xie holds a professional diploma in corporate management from the Jinan University, the PRC (中國暨南大學).
Mr. Li Wei, aged 53, is the deputy general manager, and is responsible for the formulation of development strategies and overall business management for the secondary property agency business as well as primary property agency business in the Western China Region of the Group. Mr. Li holds a bachelor's degree in material science and engineering from the Guangdong Industrial University, the PRC (廣東工業大學).
Mr. Sun Ke, aged 49, is the general manager of Southern China region and is responsible for promotion strategies and management of sales agency business for primary properties in Southern China region. Mr. Sun holds a bachelor's degree in architecture from Guangdong Industrial University, the PRC (廣東工業大學).
Mr. Ouyang Da Hui, aged 57, is the general manager of business in Northern China region and is responsible for promotion strategies and management of sales agency business for primary properties in Northern China region. Mr. Ouyang holds a bachelor's degree in engineering from the Shenzhen University, the PRC (中國深圳大學).
10 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Mr. Guo Rui, aged 44, is the general manager of regional businesses at the Guangzhou Headquarters, and is responsible for the promotion strategies and management of sales agency business for primary properties in Guangzhou region. Mr. Guo holds a bachelor's degree in Engineering Management from the Guangzhou University.
Biographical Details of Directors & Senior Management
SENIOR MANAGEMENT (Continued)
Ms. Hu Yun, aged 52, is the manager of the architectural design advisory department and is responsible for construction, planning and research for real estates and management of related consultancy business. Ms. Hu holds a bachelor's degree in architecture from the South China University of Technology, the PRC (中國華南理工大學).
Mr. Su Qi Gang, aged 51, is the general manager of the information technology department and is responsible for research and development of products of Internet application systems and management of related department. He has over 20 years of experience in information technology and Internet. Mr. Su holds a bachelor's degree in computational science from the Sun Yat-sen University (中山大學).
Mr. Zhen Zhong Xing, aged 41, is the general manager of financial services and is responsible for financial service business. Mr. Zhen holds a bachelor's degree from the Guangdong University of Finance & Economics (廣東財經大學).
COMPANY SECRETARY
Mr. Lo Hang Fong, aged 61, is a solicitor practising in Hong Kong and the company secretary of the Company. Mr. Lo holds a bachelor's degree in laws from the University of Bristol in England and a diploma in Chinese laws from the China Law Society. He has acquired over 15 years of experience in corporate advisory on mergers and acquisitions, initial public offerings and loan syndication.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 11
Management Discussion and Analysis
BUSINESS REVIEW
Market Review for 2024
In 2024, China's economy underwent cross-cyclical adjustments, while the real estate sector strived to regain its internal growth momentum. Due to ongoing adverse effects brought about by changes in the external environment, deep-seated structural contradictions that have accumulated over time in the country have emerged. Accompanied by issues such as weak domestic demand and low expectations, the real estate market did not show any prominent signs of improvement. Nationwide, investment in real estate development decreased by 10.6% year-on-year, and the floor space of buildings under construction of real estate development enterprises and the funds for investment of real estate development enterprises fell by 12.7% and 17.0% year-on-year, respectively. Thanks to increasing policy support, the market witnessed a slow recovery in the second half of the year. In response to this market situation, the Group has continued to optimize its cost structure by adjusting its operating strategy during the year, with a focus on the core cities. By elevating the efficiency of its main business and diversifying business fields, the Group strived for a stable development, maintaining its market competitiveness.
Business Review of the Group
For the year ended 31 December 2024, the Group's turnover amounted to approximately HK$947 million, a decrease of approximately 27% from the same period last year (2023: approximately HK$1,295 million), and loss attributable to shareholders amounted to approximately HK$280 million (2023: HK$531 million). Basic loss per share was HK41.5 cents (2023: HK78.8 cents). The Board of Directors did not recommend the payment of a final dividend for the year ended 31 December 2024.
Turnover of the Group's property real estate agency business in 2024 was approximately HK$924 million (2023: approximately HK$1,251 million), accounting for 98% of the Group's turnover, while the turnover of the financial services business was approximately HK$23 million (2023: approximately HK$44 million), accounting for 2% of the Group's turnover.
For the full 2024 year, the Group's total value of properties transacted was approximately HK$86 billion, while the total gross
floor area sold was approximately 3.7 million square meters.
Property Real Estate Agency Business
Turnover of the Group's property real estate agency business was approximately HK$924 million (2023: approximately HK$1,251 million). In the face of a challenging market environment, the Group sought to build a more resilient operating system to enhance business performance under its core strategy of "dare to innovate, strive for profit, and achieve scale". During the year, the Group regularly conducted comprehensive assessments of various businesses in different regions. Through in-depth analysis of market data, customer feedback and internal operations, a number of targeted adjustments were made. The Group also continued to promote its digital integration strategy, utilizing the new media business and internet marketing to expand its brand influence, attract more potential customers, and drive continuous business growth.
During the year, the Group's agency business covers approximately 40 large and medium size cities across the country, with approximately 600 agency projects and around 70 secondary branches.
Financial Services Business
12 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
During the year, the turnover of the financial services business was approximately HK$23 million (2023: approximately HK$44 million). The Group's financial services business focused on serving existing high-quality customers and took a prudent and pragmatic approach to implementing strict risk controls and conducting business operations in response to market changes, with an aim to maintain business stability.
Management Discussion and Analysis3. Other Value-Added Services
The valuation research business continued to attract customers to the Group. During the year, the Group was committed to optimizing information dissemination projects and improving their accuracy, practicability, extensiveness and timeliness. The Group also explored the application of new models and technologies to support its sales capabilities and strive to provide excellent services to customers.
In addition, the Group upgraded its online property search service platform "AI Hopefluent" to the "Bang Housing" APP and WeChat mini-program, further integrating online and offline service resources and providing a full-process, comprehensive shopping guide service. "Bang Housing" has also signed a cooperation agreement with a leading Internet company in Mainland China to jointly promote technological innovation and industrial upgrading in the real estate sector. As of 2024, the "Bang Housing" business covers more than 70 cities across the country, and the number of omni-media channel users has exceeded 8 million.
At the same time, the Group actively advanced the innovative online channel marketing business, combined big data and launched online and offline joint promotions to obtain customer information, provide professional services throughout the process, and improve transaction efficiency.
Prospects for 2025
With the government launching a series of easing and stimulus measures, the overall real estate market is stabilizing from its downturn and the transaction volume of both new and second-hand homes has rebounded significantly since the fourth quarter. The market is expecting a slight improvement, and housing prices in higher-tier cities have reversed their month-on-month decline. Looking ahead to 2025, the Group is set to benefit from the structural adjustments of the Chinese economy and the government's recent advocacy of the "vigorously promote urban renewal and reform" initiative. Under the guidance of the country's "14th Five-Year Plan" and the "dual circulation" economic strategy, it is believed that the real estate market will enter a new phase of development and create ample room for the Group's business expansion. The Group will continue to focus on the real estate service business, cultivate core city clusters, and strive to realize healthy growth.
The rapid development of artificial intelligence (AI) has brought unprecedented changes and opportunities to the real estate industry. The Group will actively explore the in-depth application of AI technology in the fields of market research, strategic consulting, property valuation and risk control, aiming to accurately capture market dynamics and customer needs, and provide investors and partners with more forward-looking decision-making support. At the same time, the Group will deepen the use of new media and launch other innovative businesses to improve business quality and operational efficiency, thereby creating higher value for the Group and its customers.
The Group will continue to review its cost structure and achieve cost reduction and efficiency enhancement through measures such as optimizing management processes, improving operational efficiency, and implementing refined management. The Group will also strengthen internal management and improve employee quality and business capabilities to provide customers with a better service experience.
Looking ahead, Hopefluent will remain committed to delivering superior products and services to customers, adhering to its sustainable development strategy, and fulfilling its corporate social responsibility to create long-term value for all investors.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 13
Management Discussion and Analysis
AUDIT COMMITTEE
The Audit Committee of the Company, comprising the three existing independent non- executive directors, has reviewed the audited financial statements for the year ended 31 December 2024.
LIQUIDITY AND FINANCIAL RESOURCES
As at 31 December 2024, the Group maintained a sound financial position where the cash and bank deposits and current ratio, as a ratio of current assets to current liabilities, were approximately HK$211 million (2023: HK$299 million) and 3.32 (2023: 4.26) respectively. Total borrowings amounted to approximately HK$123 million which are secured and unsecured bank loan and other borrowings (2023: approximately HK$167 million). The Group's gearing ratio, which was computed by dividing the total borrowings by total assets, was approximately 7.1% (2023: 7.8%). The Group's borrowings are denominated in Renminbi. The Group had no material contingent liabilities as at 31 December 2024.
PLEDGE OF ASSETS
As at 31 December 2024, the Group pledged its investment properties and property, plant and equipment with an aggregate amount of approximately HK$66 million (2023: HK$27 million) to banks to secure bank borrowings of the Group.
FOREIGN EXCHANGE EXPOSURE
Most of the Group's business transactions were denominated in either Hong Kong dollars or Renminbi. As such, the Group had no significant exposure to foreign exchange fluctuations.
EMPLOYEES
As at 31 December 2024, the Group had approximately 4,000 full time employees. Employees are regarded as the greatest and valuable assets of the Group. Competitive remuneration packages are structured to commensurate with individual job duties, qualification, performance and years of experience.
ENVIRONMENTAL POLICY
The Group is committed to building an environmental friendly working environment that conserves natural resources. The Group strives to minimize the environmental impact by saving electricity and water and encouraging recycle of office supplies.
CAPITAL STRUCTURE
14 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
As at 31 December 2024, the total number of shares (the "Shares") of HK$0.01 each in the capital of the Company in issue was 674,149,989.
Management Discussion and AnalysisBUSINESS MODEL OF THE GROUP'S MONEY LENDING BUSINESS
One of the Group's business segments is financial services, which involves, among others, providing loans to individuals or companies
in the PRC. The Group finances this moneylending business mainly with internal resources.
Potential customer(s) approach(es) the Group on their own or are referred through the Group's business network and connections. The Group focuses on the following category of customers:
for personal loans, the Group targets high net worth and reputable customers, the occupations of which ranged from executives, businessmen to professionals.
for corporate loans, the Group targets companies with well-established business operations in PRC including listed property
developers, asset management companies and other private companies.
The Group has maintained credit risk assessment policies and internal control measures in respect of, among others, credit approval, ongoing monitoring of loan recoverability and loan collection, as set out in the section headed ''Credit Risk Assessment System and Internal Control Procedures'' below to safeguard the Group's assets and interests.
CREDIT RISK ASSESSMENT SYSTEM AND INTERNAL CONTROL PROCEDURES
The Group has developed a credit risk management system in order to effectively identify, manage and minimize credit risks in connection with each loan the Group grants. In general, the Group's credit risk management process begins with an initial review and mainly consists of due diligence reviews on customers, risk assessment reviews, multilevel assessments and approvals, post-loan grant reviews and collections.
Below summarizes the key procedures of the Group's credit risk management system and internal control procedures:
Pre-loan stage
The Group will conduct an initial review of the loan application, including the completeness, legality, authenticity and validity of the materials provided by the customer, and will consider whether to accept a customer's application pursuant to its application acceptance procedure.
After initial pre-screening review, a loan application will be submitted for the formal loan assessment and review process. This involves extensive document reviews and due diligence procedures, as well as risk assessments.
As part of its due diligence procedures for grants and renewals of loans, the Group's personnel will conduct independent investigations before the results undergo multiple levels of review and approval. The independent investigations steps taken include, among others:
review the original bank statements, property ownership certificates, identification documents, legal operating licenses,
and transaction records of individuals and legal entities.
accompany the customers to the credit bureau to obtain a credit report, which allows a review of the client's current assets and liabilities.
conduct thorough due diligence by investigating the collateral offered and business premises of the customer by the
relationship manager and risk control manager.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 15
Management Discussion and Analysis
Once a loan application passes the abovementioned review, such loan application will be subject to credit review, which focuses on evaluating the customer's ability and willingness to pay its financial obligations when they fall due. As part of this process, the completed reports are reviewed and approved by more senior staff. Specifically, once the report is completed, the customer manager reviews and signs it before submitting it to the risk control assistant for checking. The risk control assistant conducts a thorough review of the customer's business operations, asset status, and document authenticity through various methods such as official litigation websites, online valuation platforms, and anti-fraud systems. The risk control assistant submits the report for approval by the risk control manager. In the event of loans above a certain threshold, final approval is also sought from the credit committee which includes directors of the finance subsidiary.
Once a loan application is approved, the Group will prepare the loan contract and other relevant documentation based on its
standard agreements and conduct its process for determining the relevant interest rate.
The Group's process for determining, adjusting and approving the interest rate charge for loans is as follows. First, the Group adopts an internal benchmark interest rate with reference to the loan prime rate set by the People's Bank of China with adjustments based on the Group's expected return on funds, funding costs (if applicable), allocation of operating expenses, market price of similar loans and other relevant data. Second, the Group further adjusts the interest rates based on different individual loans taking into account various factors including the collateral conditions (credit or mortgage), repayment type (monthly interest payment, bullet repayment, equal instalment repayment, etc.), specific provisions for different loans' reserve plans, operating costs, and market quotations from peer loans in the industry. Third, the different loans and their corresponding interest rates are approved by different departments in the Group. Lastly, the Group regularly monitors the interest rates in the market and the latest regulations from regulatory authorities so further adjustments can be made based on objective needs.
Post-loan and recovery stages
After granting the loans, the Group will continue to monitor the customer's ability to repay the loans. It will also conduct periodic reviews of the loans and conduct on-site visits or telephone interviews with the customers to monitor the risks associated with loans.
Based on the circumstances and results of the negotiation with customers, the Group has then taken appropriate recovery actions including sending legal demand letters, arranging legal proceedings, enforcing guarantees or rights over collateral provided and entering into settlement or loan restructuring arrangements.
Based on the progress and outcomes of the legal proceedings, the collection methods are reviewed by relevant personnel and where appropriate, raised to the attention of senior management to determine if any adjustments are required, to formulate other strategies for recovery and to consider if further legal action needs to be taken.
16 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Regular reports are submitted to the senior management, providing an overview of overdue principal and interest, collateral status, project location, collection progress, and optimization plans. Where issues arise, the matter is also raised to senior management to allow for sufficient oversight.
Types of loans
Number of customers
Personal loans 898
Corporate loans 18
916
Secured or unsecured Types of collateral
Number of customers
Unsecured Personal or corporate guarantee only 895
Secured Property 14
Secured Projects pledge 7
916
LOAN IMPAIRMENT POLICIES
The Group performs impairment assessments under the expected credit loss (''ECL'') model on financial assets (including loan receivables) which are subject to impairment under Hong Kong Financial Reporting Standard 9 - Financial Instruments issued by the Hong Kong Institute of Certified Public Accountants. The amount of ECL is updated at each reporting date to reflect changes in credit risk since initial recognition. For detailed impairment policies, please refer to the sub-paragraph headed ''Impairment of financial assets'' in the ''Material accounting policies'' on pages 68 to 70. Details of the movements in the allowance on loan receivables of the Group during the year are set out in note 21 to the consolidated financial statements.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 17
Management Discussion and AnalysisBREAKDOWN OF LOANS
The Group offers both secured and unsecured loans. Secured loans are mainly secured by properties in the PRC or project pledges. All of the loans are guaranteed by personal or corporate guarantees. During the year ended 31st December 2024, the Group had granted loans to 916 customers. Set out below is the table showing breakdown types of loans and types of collateral during the year
ended 31st December 2024.
Corporate Governance Report
CORPORATE GOVERNANCE PRACTICES
The board of directors of the Company (the "Board") and the management of the Company and its subsidiaries (the "Group") are committed to establishing good corporate governance practices and procedures. The maintenance of high standard of business ethics and corporate governance practices have always been one of the Group's goals. The Company believes that good corporate governance provides a framework that is essential for effective management, successful business growth and a healthy corporate
culture, thereby leading to the enhancement of shareholders' value.
The Board leads to establish, promote and continually reinforce the desired corporate culture of the Company which is underpinned by our corporate values of committing high standard of business ethics and integrity. Our sound corporate culture reaches all levels of the Group, and aligns with the Company's corporate values and strategies.
The Board has adopted the Corporate Governance Code (the "CG Code") as set out in Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules"). Continuous efforts are made to review and enhance the Group's risk management and internal controls and procedures in light of changes in regulations and developments in best practices. To us, maintaining high standards of corporate governance practices is not just complying with the provisions but also the intent of the regulations to enhance corporate performance and accountability.
The Board is pleased to report compliance with the code provisions of the CG Code for the year ended 31st December, 2024, except where otherwise stated.
DIRECTORS' SECURITIES TRANSACTIONS
The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 to the Listing Rules (the "Model Code") as its own code of conduct regarding securities transactions by directors. Having made specific enquiry with all directors, the directors confirmed that they all had complied with the required standard set out in the Model Code throughout the year.
BOARD OF DIRECTORS
The Board comprises:
Executive Directors : Mr. FU Wai Chung (Chairman)
Mr. LO Yat Fung
Mr. GAO Bin (President) (resigned on 21st March, 2025)
Non-executive Directors : Mr. FU Ear Ly
Mr. LI Bo (appointed on 21st March, 2025) Mr. LI Fuqiang (appointed on 21st March, 2025)
Mr. HUANG Peng (resigned on 21st March, 2025)
Independent Non-executive Directors : Mr. LAM King Pui
Mr. CAO Qimeng Ms. XU Jing
Each independent non-executive director has given an annual confirmation of his/her independence to the Company, and the Company considers them to be independent under Rule 3.13 of the Listing Rules.
Mr. Fu Ear Ly is the son of Mr. Fu Wai Chung. Save as disclosed above, there is no financial, business, family or other material/ relevant relationship between any members of the Board.
Mr. Huang Peng, a non-executive director, appointed during the year, confirm that he has obtained the legal advice referred to under Rule 3.09D of the Listing Rules on 27th May, 2024 and understand his legal obligations as a director of a listed issuer under the Listing Rules.
Mr. Li Bo and Mr. Li Fuqiang, non-executive directors appointed on 21st March, 2025, confirm that they have obtained the legal advice referred to under Rule 3.09D of the Listing Rules on 21st March, 2025 and understand their legal obligations as directors of a listed issuer under the Listing Rules.
18 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Number of meetings attended in the year ended 31st December, 2024 | |||
Name of director | Board meetings | 2024 AGM | EGMs |
Mr. FU Wai Chung | 4/4 | 1/1 | 2/2 |
Mr. GAO Bin | 4/4 | 1/1 | 2/2 |
Mr. LO Yat Fung | 4/4 | 1/1 | 2/2 |
Mr. FU Ear Ly | 4/4 | 1/1 | 2/2 |
Mr. HUANG Peng (Appointed on 31st May, 2024) | 2/2 | 0/1 | 1/1 |
Mr. LAM King Pui | 4/4 | 1/1 | 2/2 |
Mr. CAO Qimeng | 4/4 | 1/1 | 2/2 |
Ms. XU Jing | 4/4 | 1/1 | 1/2 |
Mr. ZHU Rongbin (Resigned on 31st May, 2024) | 1/1 | N/A | 1/1 |
Corporate Governance Report
BOARD OF DIRECTORS (Continued)
During the financial year ended 31st December, 2024, 4 board meetings, one annual general meeting ("2024 AGM") and two
extraordinary general meetings ("EGMs") were held and the attendance of each director is set out as follows:
RESPONSIBILITIES OF THE BOARD
The Board is responsible for leadership and control of the Group and be collectively responsible for promoting the success of the Group by directing and supervising the Group's affairs. The Board focuses on formulating the Group's long-term objectives and overall strategies; authorising the development plan and budget; determining and approving financing options; monitoring financial and operating performance; reviewing the effectiveness of the risk management and internal control systems; supervising and managing management's performance of the Group; and setting the Group's values and standards. The Board delegates the day-to-day management, administration and operation of the Group to management. The delegated functions are reviewed by the Board periodically to ensure that they accommodate the needs of the Group.
CORPORATE GOVERNANCE FUNCTIONS
No corporate governance committee has been established and the Board is responsible for performing the corporate governance functions such as developing and reviewing the Company's policies, practices on corporate governance, training and continuous professional development of directors and senior management, ensuring the Company's policies and practices are in compliance with legal and regulatory requirements, etc. The Board reviewed the Company's policies and practices on corporate governance as well as the Company's compliance with the CG Code.
The Board held meetings from time to time whenever necessary. At least 14 days notice of regular Board meetings is given to all directors and they can include matters for discussion in the agenda as they think fit. The agenda accompanying board papers are sent to all directors at least 3 days before the date of every board meeting in order to allow sufficient time for the directors to review the documents.
Minutes of every board meeting are circulated to all directors for their perusal and comments. Minutes are open for inspection at any reasonable time on reasonable notice by any director. The Board also ensures that it is supplied in a timely manner with the agenda and all necessary information in a form and of a quality appropriate to enable it to discharge its duties.
Every board member has full access to the advice and services of the company secretary with a view to ensuring that board procedures, and all applicable rules and regulations are followed and they are also entitled to have full access to board papers and related materials so that they are able to make an informed decision and to discharge their duties and responsibilities.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 19
Corporate Governance Report
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
According to code provision C.2.1 of the CG Code, the roles of chairman and chief executive officer should be separated and should not be performed by the same individual. Since 21st March 2025, the Company has no such title as the chief executive officer and Mr. Fu Wai Chung ("Mr. Fu") remains as the chairman of the Company. Mr. Fu has extensive experience in the industry which is beneficial and of great value to the overall development of the Company. The daily operation and management of the Company
is monitored by the executive directors as well as the senior management. The Board is of the view that the balance of power and
authority is ensured by the operation of the Board, which comprises experienced individuals and meet from time to time to discuss issues affecting operation of the Company. The Board has been nevertheless reviewing the structure and composition of the Board from time to time in light of prevailing circumstances, in order to maintain a high standard of corporate governance practices of the Company.
APPOINTMENT AND RE-ELECTION OF DIRECTORS
Each executive director is appointed for an initial term which is renewable automatically each year. All independent non-executive directors are currently appointed for a specific term up to year 2025 which may be extended as each director and the Company may agree in writing. The term of appointment of the non-executive directors is to year 2026 and year 2028 respectively thereafter is renewable automatically each year. However, their appointment are subject to retirement by rotation and re-election at the annual general meetings of the Company in accordance with the provision of the Articles of Association of the Company (the "Articles of Association").
The Articles of Association of the Company provides that at each annual general meeting, one-third of the directors for the time
being shall retire from office by rotation and that every director shall be subject to retirement by rotation at least once every 3 years.
PROFESSIONAL DEVELOPMENT
During the review year, directors attended relevant seminars to develop and refresh their knowledge and skills. All directors also participate in continuous professional development programmes such as external seminars or webinars organised by qualified professionals, to develop and refresh their knowledge and skills in relation to their contribution to the Board. A record of the training received by the respective directors are kept and updated by the Company.
The individual training record of each director received for the year ended 31st December, 2024 is summarised below:
Attending seminar(s)/
webinars/ forum(s)/programme(s)/ conference(s) relevant
to the business or directors' duties
Mr. FU Wai Chung ✓
Mr. LO Yat Fung Mr. FU Ear Ly Mr. HUANG Peng Mr. LAM King Pui Mr. CAO Qimeng
Ms. XU Jing
20 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Mr. GAO Bin ✓
✓
✓
✓
✓
✓
✓
Corporate Governance Report
PROFESSIONAL DEVELOPMENT (Continued)
Mr. Fu Wai Chung, Mr. Gao Bin and Mr. Lo Yat Fung, being executive directors, Mr. Fu Ear Ly and Mr. Huang Peng, being non-executive directors, have attended various seminars or webinars and meetings to develop and refresh their knowledge so as to ensure that their contribution to the Board remains informed and relevant. Mr. Lam King Pui, Mr. Cao Qimeng and Ms. Xu Jing, being independent non-executive directors, have participated in continuous professional development programs provided by, among
others, the Hong Kong Institute of Certified Public Accountants. All the directors also understand the importance of continuous
professional development and are committed to participating any suitable training to develop and refresh their knowledge and skills.
AUDIT COMMITTEE
The audit committee of the Company (the "Audit Committee") comprises the three existing independent non-executive directors, who have reviewed the financial statements for the year ended 31st December, 2024. Mr. Lam King Pui, the chairman of the Audit Committee, has professional qualifications and in-depth experience in accounting and related financial management expertise. No member of the Audit Committee is a member of the former or existing auditor of the Company. The terms of reference of the Audit Committee are available at the Company's website and on the website of The Stock Exchange of Hong Kong Limited.
According to the existing terms of reference of the Audit Committee, its major roles and functions are, amongst others, to consider the appointment of the external auditors, the audit fee, and any questions of resignation or dismissal of the external auditors; to review the half-year and annual financial statements before submission to the Board; to monitor the quality of risk management and internal control and to consider major findings of internal investigations and management's response.
Four meetings were held for the year ended 31st December, 2024. The attendance of each member is set out as follows:
Name of members of Audit Committee
Number of meetings attended in the financial year ended 31st December, 2024
Mr. LAM King Pui 4/4
Mr. CAO Qimeng 4/4
Ms. XU Jing 4/4
At the meetings held during the year, in performing its duties in accordance with its terms of reference, the work performed by the Audit Committee included:
review and supervise the financial reporting process and risk management and internal control systems of the Company and
its subsidiaries;
make recommendation to the Board, for the approval by shareholders, of the re-appointment of the auditor and approval of
their remuneration;
review the financial statements for the relevant periods; and
discuss the accounting policies and practices and business development of the Group.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 21
Corporate Governance Report
REMUNERATION COMMITTEE
The remuneration committee of the Company (the "Remuneration Committee") comprises the three existing independent non-executive directors and Mr. Lam King Pui is the chairman of the Remuneration Committee. The terms of reference of the Remuneration Committee are available at the Company's website and on the website of The Stock Exchange of Hong Kong Limited.
The roles and functions of the Remuneration Committee include consulting the chairman of the Board about their remuneration proposals for other executive directors, making recommendation to the Board on the Company's remuneration policy and structure for all directors' and senior management and to review and/or approve matters relating to share schemes. The Remuneration Committee has adopted the approach under the E.1.2(c)(ii) of the code provisions to make recommendations to the Board on the remuneration packages of individual executive directors and senior management.
The Group's human resources department assists the Remuneration Committee by providing relevant remuneration data and market conditions for the Committee's consideration. The remuneration of executive directors and senior management is determined with reference to the Company's performance and profitability, as well as remuneration benchmarks in the industry and the prevailing market conditions.
One meeting was held during the year ended 31st December, 2024. During the meeting, the remuneration of a new director was
considered. No director or any of his associates was involved in deciding his own remuneration.
The attendance of each member is set out as follows:
Name of members of Remuneration Committee
Number of meetings attended in the financial year ended 31st December, 2024
Mr. LAM King Pui 1/1
Mr. CAO Qimeng 1/1
Ms. XU Jing 1/1
A share option scheme has been adopted in an extraordinary general meeting held on 23rd May, 2023. Details of this share option scheme are set out in a circular dated 3rd May, 2023.
A refreshment of share option scheme mandate limit has been approved in an extraordinary general meeting held on 20th December, 2024. Details of this refreshment of share option scheme mandate limit are set out in a circular dated 28th November, 2024.
The emolument payable to directors depends on their respective contractual terms under the service contracts and the appointment letters, and as recommended by the Remuneration Committee. Details of the directors' emolument are set out in note 12 to the
HK$
Number of members of
senior management
consolidated financial statements.
The remuneration of the members of the senior management (other than directors) by band for the year ended 31st December, 2024 is set out below:
500,000 to 1,500,000
1,500,000 to 2,500,000
6
5
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Corporate Governance Report
NOMINATION COMMITTEE
The nomination committee of the Company (the "Nomination Committee") was established on 22nd March, 2012 comprising Mr. Fu Wai Chung, Mr. Fu Ear Ly and the existing three independent non-executive directors. Mr. Fu Wai Chung is currently the chairman of the Nomination Committee. The terms of reference of the Nomination Committee are available at the Company's website and on
the website of The Stock Exchange of Hong Kong Limited.
According to the terms of reference of the Nomination Committee, its major roles and functions are as follows:
to review the structure, size and composition (including the skills, knowledge and experience) of the Board at least annually and to make recommendations on any proposed changes to the Board to complement the Company's corporate strategy;
to identify individuals suitably qualified to become Board members and select or make recommendations to the Board on the
selection of individuals nominated for directorships of the Company;
to assess the independence of independent non-executive directors of the Company; and
to make recommendations to the Board on the appointment or re-appointment of directors of the Company and succession
planning for directors, in particular the chairman and the chief executive of the Company.
NOMINATION POLICY
In considering the nomination of new directors, the Board and nomination committee will take into account the qualification, ability, working experience, leadership and professional ethics of the candidates, especially their experience in the property real estate agency and consultancy services and/or other professional areas and the diversity criteria set out in the board diversity policy of the Company.
The procedures for the election and appointment of director(s) are that the committee may search for candidates for directors on an extensive scale in the Company, its subsidiaries and the job market, gather information of the preliminary candidates and then shall submit to the board of directors its recommendations on candidates for directors and relevant materials prior to the election of new directors.
Two meetings were held during the year ended 31st December, 2024. During the meetings, the appointment of new director has been considered and approved and the Committee had also confirmed the independence of independent non-executive director who would be retired and offered himself for re-election at 2024 AGM and the diversity of the Board.
The attendance of each member is set out as follows:
Name of members of Nomination Committee
Number of meetings attended in the financial year ended 31st December, 2024
Mr. FU Wai Chung (Appointed on 31st May, 2024) N/A
Mr. FU Ear Ly 2/2
Mr. LAM King Pui 2/2
Mr. CAO Qimeng 2/2
Ms. XU Jing 2/2
Mr. ZHU Rongbin (Resigned on 31st May, 2024) 1/1
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 23
Corporate Governance Report
BOARD AND WORKFORCE DIVERSITY
The Board has a board diversity policy which sets out the approach to achieve a sustainable and balanced development of the
Company and also to enhance the quality of performance of the Company.
The Company seeks to achieve board diversity through the consideration of a number of factors, including but not limited to gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge and length of service. All board
appointments will be based on meritocracy, and candidates will be considered against objective criteria, having due regard for the benefits of diversity on the Board.
Selection of candidates will be based on a range of diversity perspectives as stated in the above. The ultimate decision will be based
on merit and contribution that the selected candidates will bring to the Board.
As at the date of this report, the Board comprises 8 directors. One of them is women. Three of the directors are independent non-executive directors and independent of management, thereby promoting critical review and control of the management process. The Board is also characterised by significant diversity, whether considered in terms of gender, professional background and skills. Biographical details with the professional experience, skills and knowledge of the Directors are available in the section of "Biographical Details of Directors and Senior Management" of this annual report.
The Board comprises eight directors and one of them is female. The Company targets to avoid a single gender Board and will timely review the gender diversity of the Board in accordance with the business development of the Group. The Company believes the balance of gender in the Board would bring more inspiration to the Board and enhance the business development of the Group, thus gender diversity is one of the essential factor for the Company to select suitable candidate as a Director.
As at the date of this report, approximately 90% of the Company's senior workforce (including the directors and senior management) is male and approximately 10% is female. Same as the gender diversity of the Board, the Company targets to avoid a single gender senior workforce and will timely review the gender diversity of the senior workforce in accordance with the business development of the Group. Details of the Group's gender diversity at workforce level are set out in the Environmental, Social and Governance report of this annual report.
Category
2
Executive Directors
The following tables further illustrate the diversity of the Board members as of the date of this annual report:
3
Independent
Non-Executive Directors
3
Non-Executive Directors
7 Male | 1 Female | ||
5 | 2 | 1 | |
30-49 | 50-69 | Over 70 |
Gender
Age Group
The Company has not set any measurable objectives for implementation of the diversity policy in relation to the Board members and the workforce of the Group (including gender diversity) because property real estate agency service is neither a male nor female dominated industry. However, the Company will consider and review from time to time such diversity policy (including gender diversity) and setting of any measurable objectives (if applicable).
24 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Corporate Governance Report
DIVIDEND POLICY
The Board has approved and adopted a policy for the Company's dividend distribution (the "Dividend Policy") in 2019.
The Dividend Policy of the Company aims at enhancing transparency of the Company and facilitating the shareholders and investors to make informed investment decisions relating to the Company.
Under the Dividend Policy, the Company does not have any pre-determined dividend payout ratio. The declaration, payment and amount of dividends are subject to the Board's discretion having regard to the following factors:
the Group's actual and expected financial performance;
the Group's expected working capital requirements, capital expenditure requirements and future expansion plans;
retained earnings and distributable reserves of the Company and each of the members of the Group;
the Group's liquidity position;
the general economic conditions and other internal or external factors that may have an impact on the business or financial
performance and position of the Group;
the contractual restrictions on the payment of dividends by the Company to its shareholders (if any);
the statutory and regulatory restrictions on the payment of dividends by the Company; and
any other factors that the Board deems relevant.
The Company's dividend distribution record in the past may not be used as a reference or basis to determine the level of dividends
that may be declared or paid by the Company in the future.
Such declaration and payment of dividend by the Company is also subject to any restrictions under the Companies Laws of the Cayman Islands, any applicable laws, rule 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 Board's determination that the same would be in the 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 assurance that dividends will be paid in any particular amount for any given period.
ACCOUNTABILITY AND AUDIT
Financial Reporting
The management provides such explanation and information to the Board and reports regularly to the Board on financial position and prospects of the business of the Company so as to enable the Board to make an informed assessment of the financial and other information put before the Board for approval.
The directors acknowledge their responsibilities (as set out in the Independent Auditor's Report) for preparing the financial statements of the Group that give a true and fair view of the state of affairs of the Group. The Board was not aware of any material uncertainties relating to events or conditions that might cast significant doubt upon the Group's ability to continue as a going concern and the Board has prepared the financial statements on a going concern basis. The responsibility of the external auditor is to form an independent opinion, based on their audit, on those consolidated financial statements prepared by the Board and to report their opinion solely to the shareholders of the Company, as a body, and for no other purpose. A statement by auditor about their reporting responsibility is set out in the Independent Auditor's Report.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 25
Corporate Governance Report
ACCOUNTABILITY AND AUDIT (Continued)
Risk Management and Internal Control Systems
The Board is responsible for the risk management and internal control systems of the Company and reviewing their effectiveness. The Board oversees the overall risk management of the Group and endeavours to identify, control impact of the identified risks and facilitate implementation of coordinated mitigating measures. The risks have been disclosed in the report of the directors of this annual report. The risk management and internal control systems of the Company are designed to manage rather than eliminate the risk of failures to achieve business objectives, and can only provide reasonable and not absolute assurance against material misstatement or loss.
Each department of the Company would choose certain material risk events in its field every year and assess and grade the possibility of occurrence and influence of risk events to determine the scope of material risk of the year together with the management of the Company. Each functional department prepares counteractions to deal with material risks in its field and report the execution situation regularly.
The Company has maintained an internal control department ("ICD") established in 2006 which performs an internal audit function and reported directly to the Board. The function of the ICD audit team is to ensure the branches operation and practices are complied with the Group's policies and procedures. The team has reviewed and checked the sales performance reports and cash flow of each branch rotationally. The management of the Company has established a set of structure, standards and procedures in areas of operational, financial and risk controls for safeguarding assets against unauthorised use or disposition; for maintaining proper accounting records; and for ensuring the reliability of financial information to achieve a satisfactory level of assurance against the likelihood of the occurrence of fraud and errors.
The Board reviews the risk management and internal controls annually. The Board has conducted a review of, and is satisfied with the effectiveness and adequacy of the risk management and internal control systems and the internal audit function for the year ended 31st December, 2024.
With respect to the monitoring and disclosure of inside information, the Company has formulated its guidelines, with an aim to
ensure that the insiders abide by the confidentiality requirement and fulfil the disclosure obligation of the inside information.
Auditors' Remuneration
Services rendered
Fees paid/payable
HK$'000
During the financial year ended 31st December, 2024, the fees paid to the Company's auditors is set out as follows: The non-audit services provided by the auditors are relating to review of the Company's interim report.
Audit and audit related services 2,800
Non-audit services 300
3,100
COMPANY SECRETARY
The Company has engaged Mr. Lo Hang Fong, a solicitor practising in Hong Kong, as its company secretary and Mr. Lo Yat Fung, an executive director of the Company, is the person whom the company secretary can contact. The Board is confident that having Mr. Lo Hang Fong as the company secretary is beneficial to the Group's compliance of the applicable laws, rules and regulations. The biographical details of Mr. Lo Hang Fong are set out under the section headed "Biographical Details of Directors & Senior Management".
According to Rule 3.29 of the Listing Rules, Mr. Lo Hang Fong has taken no less than 15 hours of relevant professional training during the financial year ended 31st December, 2024.
26 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Corporate Governance Report
SHAREHOLDERS' RIGHTS
The general meetings of the Company provide an opportunity for communication between the shareholders and the Board. An annual general meeting of the Company shall be held in each year and at the place as may be determined by the Board. Each general meeting, other than an annual general meeting, shall be called an extraordinary general meeting ("EGM").
- Right to convene EGM
Any one or more members holding at the date of the 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 written requisition sent to the Company's business office as set out in the manner below, to require an EGM to be called by the Board for the transaction of any business specified in such requisition; and such meeting shall be held within two (2) months after the deposit of such requisition.
The written requisition must state the purposes of the meeting, signed by the requisitionist(s) and deposit it to the Board or the company secretary of the Company at the Company's place of business in Hong Kong at Room 1302, 13th Floor, Shun Tak Centre West Tower, 200 Connaught Road Central, Hong Kong and such may consist of several documents in like form, each signed by one or more requisitionists.
The request will be verified with the Company's branch share registrars in Hong Kong and upon their confirmation that the request is proper and in order, the company secretary of the Company will ask the Board to convene an EGM by serving sufficient notice in accordance with the statutory requirements to all the registered members. On the contrary, if the request has been verified as not in order, the shareholders will be advised of this outcome and accordingly, an EGM will not be convened as requested. If within twenty-one days from the date of the deposit of the requisition the Board fails to proceed to convene such meeting, the requisitionist(s), may convene a meeting in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of the Board shall be reimbursed by the Company to the requisitionist(s).
The notice period to be given to all the registered members for consideration of the proposal raised by the requisitionist(s) concerned at the EGM varies according to the nature of the proposal, as follows:
At least 14 clear days' notice in writing if the proposal constitutes an ordinary resolution of the Company;
At least 21 clear days' notice in writing if calling for an annual general meeting or the proposal constitutes a special
resolution of the Company in EGM.
Right to put enquiries to the Board
Shareholders have the right to put enquiries to the Board. All enquiries shall be in writing and sent by post to the place of business of the Company in Hong Kong or by e-mail to info@hopefluent.com.hk for the attention of the Board or company secretary.
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Corporate Governance Report
SHAREHOLDERS' RIGHTS (Continued)
Right to put forward proposals at general meetings
There are no provisions allowing shareholders to propose new resolutions at the general meetings under the Cayman Islands Companies Law (2011 Revision). However, shareholders are requested to follow Article 58 of the Company's Articles of Association for including a resolution at an EGM. The requirements and procedures are set out above. Pursuant to Article 88 of the Company's Articles of Association, no person, other than a director retiring at a meeting, shall, unless recommended by the directors for election, be eligible for appointment as a director at any general meeting unless a Notice signed by a member (other than the person to be proposed) duly qualified to attend and vote at the meeting for which such notice is given of his intention to propose such person for election and also a notice signed by the person to be proposed of his willingness to be elected shall have been lodged at the head office or at the registration office provided that the minimum length of the period, during which such notice(s) are given, shall be at least seven (7) days and that (if the notices are submitted after the despatch of the notice of the general meeting appointed for such election) the period for lodgment of such Notice(s) shall commence on the day after the despatch of the notice of the general meeting appointed for such election and end no later than seven (7) days prior to the date of such general meeting.
The written notice must state that person's biographical details as required by Rule 13.51(2) of the Listing Rules. The
procedures for shareholders of the Company to propose a person for election as director is posted on the Company's website.
INVESTOR RELATIONS
Communication with Shareholders
The Company has established a shareholders' communication policy and the Board shall review it on a regular basis to ensure its effectiveness. The Company communicates with the shareholders and/or potential investors mainly by: (i) holding of annual general meeting ("AGM") and extraordinary general meetings which shall be convened for specific purposes (if any) which provide opportunities for the shareholders to communicate with the Board; (ii) the publication of announcements, annual reports, interim reports and/or circulars as required under the Listing Rules; and (iii) the availability of information of the Group on the Company's website at https://www.hopefluent.com.
Shareholders and investors are welcome to visit the Company's website to raise enquiries where responsible staff contact details are available on the Company's website.
The chairman of the 2024 AGM and the chairman/members of the Board Committees and the external auditor were available at the 2024 AGM to answer questions from the shareholders. The procedures for conducting a poll have been explained during the meeting.
Shareholder communication is effective during the year because shareholders can raise questions to the management of the Company at the 2024 AGM and EGMs and has made enquiries about the Company through contacting the relevant staff. The Board reviewed the implementation and effectiveness of the Shareholders' communication policy and the results were satisfactory.
During the year ended 31st December, 2024, there had been no change in the Company's constitutional documents. The memorandum and articles of association is available on the websites of the Company and of the Stock Exchange.
28 HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024
Directors' Report
The directors present their annual report and the audited consolidated financial statements for the year ended 31st December, 2024.
PRINCIPAL ACTIVITIES
The Company acts as an investment holding company. The activities of its principal subsidiaries are set out in note 42 to the
consolidated financial statements.
RESULTS AND APPROPRIATIONS
The results of the Group for the year ended 31st December, 2024 are set out in the consolidated statement of profit or loss and other comprehensive income on page 57.
On 28th March, 2025, the Board did not recommend the payment of a final dividend for the year ended 31st December, 2024 (2023: nil).
There was no interim dividend declared for the six months ended 30th June, 2024 (six months ended 30th June, 2023: nil). The dividend policy of the Group is set out in the Corporate Governance Report of this report.
BUSINESS REVIEW
The business review of the Group for the year ended 31st December, 2024 is set out in the section headed "Management Discussion and Analysis" on page 12 respectively of this Annual Report.
RELATIONSHIP WITH STAKEHOLDERS
The Group recognises that employees, customers and business partners are keys to its sustainable development. The Group is committed to establishing a close and caring relationship with its employees, providing quality services to its customers and enhancing cooperation with its business partners.
The Company provides a fair and safe workplace, competitive remuneration and benefits and career development opportunities based on their merits and performance. The Group also puts ongoing efforts to provide trainings and development resources to the employees so that they can keep abreast of the latest development of the market and the industry and, at the same time, improve their performance and self-fulfillment in their positions.
The Group understands that it is important to maintain good relationship with customers and provide property information that satisfy needs and requirements of the customers. The Group enhances the relationship by continuous interaction with customers to gain insight on the changing market demand for the property so that the Group can respond proactively.
The Group is also dedicated to develop good relationship with developers as long-term business partners to ensure stability of the
Group's business.
HOPEFLUENT GROUP HOLDINGS LIMITED • ANNUAL REPORT 2024 29