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Public company info - Rentian Technology Holdings Ltd. , 00885.HK
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Rentian Technology Holdings Ltd., 00885.HK - Company Profile
Chairman -
Share Issued (share) 11,023,000,000
Par Currency Hong Kong Dollar
Par Value 0.001
Industry Software
Corporate Profile Business Summary: The group is principally engaged in the businesses of (i) the provision of integrated smart IoT solutions to enterprise customers; (ii) human-machine interactive devices; (iii) intelligent documentation service; (iv) securities investment; and (v) money lending. Performance for the year: The Group’s revenue for the Year decreased from approximately HK$1,134.9 million for the year ended 31 December 2018 to approximately HK$175.5 million, representing a year-on-year decrease of 84.5%. Business Review The Group has the following major business activities during the Year: IoT Business The major business activities of the Group covers cloud computing and data processing and analysis (“cloud”), telecommunication infrastructure and technologies (“pipeline”) and terminal computing (“endpoint”) for corporate Integrated Smart Internet-of Things (“IoT”) systems. The Group’s IoT business can be further divided into 3 segments, namely (i) IoT solution; (ii) Human-machine Interactive Devices (“HMID”); and (iii) Intelligent Documentation Service (“IDS”). During the Year, the Group’s segment loss from the IoT solution business amounted to approximately HK$382.7 million for the Year, representing a decrease of approximately 66.2% from segment loss amounted to approximately HK$1,131.5 million in the year of 2018. Segment profit from the IDS business decreased to approximately HK$22.2 million for the Year, representing a decrease of approximately 18.4% from approximately HK$27.2 million in the year of 2018. Segment profit from the HMID business of HK$13.6 million in the year 2018 decreased to segment loss of approximately HK$93.0 million, representing a decrease of approximately 783.8% for the Year. Impairment of goodwill in IoT solution segment The US-China trade war spreading from goods to services has brought unfavorable market conditions to the IoT solution segment in the PRC and weakened the ultimate customers’ confidence. Also, the increasing restrictions and regulations imposed to the new entrants and existing market players further increased the difficulties in the development of existing and potential customers. Along with the reduction on number of customers followed by keen competition in the market and the slowdown in growth of the PRC economy, the IoT solution segment faced a challenging year in 2019. These circumstances indicated that impairment on goodwill and intangible assets arising from the acquisition of subsidiaries under IoT solution segment in previous years is necessary. The Group has made a downward adjustment on the profit of these acquired subsidiaries in the financial forecast based on the current circumstances as discussed above. Impairment loss on goodwill and intangible assets amounted to approximately HK$120.1 million and approximately HK$14.1 million respectively was recognised for the Year. Securities Investment Business The Group invested in various financial instruments as both short-term and long-term investments. During the Year, the Group recorded a net realised loss on disposal of financial assets at fair value through profit or loss of approximately HK$766.8 million and a loss on changes in fair value of financial assets at fair value through profit or loss of approximately HK$146.6 million. The Group’s significant investments (i.e. investment with carrying amount exceeding 5% of the total assets of the Group) held as at 31 December 2019 are as follows: The Group’s equity interests in Co-Lead Holdings Limited (“Co-Lead”), a company incorporated in the British Virgin Islands (“BVI”) with limited liability. As at 31 December 2019, the Group held 8.58% (2018: 8.58%) equity interests in Co-Lead with fair value of HK$218,966,000 (2018: HK$233,261,000) which was classified as financial assets designated at fair value through other comprehensive income as set out in note 17 to the consolidated financial statements. During the year ended 31 December 2019, a decrease in fair value of HK$14,295,000 (2018: HK$34,239,000) in Co-Lead was recognised in fair value reserve (non-recycling). The principal activity of Co-Lead is investment holding. The investment in Co-Lead with carrying amount is 14.8% of the total assets of the Group held as at 31 December 2019 (2018: 5.4%). In August 2018, the Group entered into a subscription agreement with Satinu Resources Group Limited (“Satinu”), a company incorporated in the BVI with limited liability, pursuant to which the Group shall acquire 2.11% equity interests in Satinu at a consideration of HK$175,000,000 by issuing promissory notes. Due to the allotment of new shares to other investors during 2019, the Group’s equity interests in Satinu were diluted from 2.11% to 1.76%. As at 31 December 2019, the Group’s 1.76% equity interest in Satinu with fair value of HK$121,790,000 (2018: HK$136,212,000) was classified as financial assets at fair value through profit or loss as set out in note 19 to the consolidated financial statements. The principal activities of Satinu are provision of integrated financial services, securities brokerage services, money lending, securities and other direct investments. During the year ended 31 December 2019, the fair value loss of HK$14,422,000 (2018:HK$35,028,000) in respect of the investments in Satinu was recognised in profit or loss. The investment in Satinu with carrying amount is 8.2% of the total assets of the Group held as at 31 December 2019 (2018: 3.1%). Money Lending Business The Group provides short-term loans to various borrowers. Those short-term loans carried interest rates ranging from 5% to 18% per annum. During the Year, the money lending business contributed a loan interest income of approximately HK$1.6 million to the Group. Prospects: IoT Business The trade war between China and the United States was not resolved until the two sides reached an agreement in early 2020. Affected by the growing concerns over the COVID-19, economic situation of China and Hong Kong are expected to be uncertain. Additionally, the severe competition in the information technology industry in China is expected to adversely affect the financial performance of the Group’s internet-of-things solutions business and related businesses. In coming years, the operation of the IoT business is expected to remain challenging. The Group will endeavour to expand customer base in coming years to improve the financial performance of this segment. The Group’s management will continue to pay close attention to the prospect of profitable business segments and to maximize the interests of Shareholders. Looking forward, Rentian Technology will adopt a proactive attitude in the Chinese IoT sector and focus the capital and management resources on the core and major business activities by integrating the existing resources, promoting “IoT +” and optimising the business portfolio. Integrated Smart IoT Solutions business The Group continued to pursue IoT telecommunication development. In addition to EoC telecommunication equipment and fibre-optic telecommunication equipment for the existing telecommunication operators, the Group will continue to enlarge its share in the telecommunication operator market with the development and sale of auxiliary telecommunication products. New products such as home plug has been successfully commercialised and applied by telecommunication operators. The Group offers smart logistic bin products to renowned domestic and overseas logistic, e-commerce, retailing and catering brands. The Group expects that further enhancement will be seen in the coming year. HMID Business The Group focuses on commercial HMID and develops terminal hardware, software and service applications for treasury, taxation, finance, education and other key industries. It offers smart and mobile-internet corporate solutions including but not limited to industry-specific integrated or self-service systems, smart payment devices, printing devices and all-in-one cloud-based systems. Apart from the traditional banking sectors, the Group will continue to explore the national treasury and taxation and other sectors, in respect of the research and development of new products. IDS Business The Group provides specialised services to accelerate document driven business processes to over 40 companies in the property insurance and life insurance industry in the PRC. The entire service process is supported by high level of confidentiality, data accuracy and processing velocity. The Group is also engaged in development and sale of software products and technology and provision of IT services and operations in combination with various industry applications, leveraging its technological expertise in the insurance sector. The Group will continue to focus on developing its existing business as well as expanding into new innovative solutions with high growth potential. Securities Investment Business Triggered by the epidemic outbreak of coronavirus disease (COVID-19) in early 2020 and growing concerns and uncertainty over the Sino-United States trade, economic situation of China and Hong Kong are expected to be uncertain. The global stock market, including PRC and Hong Kong, suffered a severe blow due to the uncertainty of global business market. Given the unstable financial and investment environment, the Group will adopt a more prudent approach in securities investment that the Group will scale down its investment segment and put more resources and concentration in other operating segments.

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