To Our Shareholders,
On behalf of the Board of Directors of In Construction Holdings Limited (the “Company”), I am pleased to present you with the annual report for the year ended 31 March 2017 (the “Financial Year 2016/17”).
Founded in 1996, our Company is an experienced general and foundation contractor serving the Hong Kong building and construction industries by offering quality and flexible solutions to our customers. Using our ability to solve different and complex issues on construction projects, we continue to build trust and credibility with our existing and new customers. We could not have done it without the support of our business partners who have been working with us job-by job over the years. The implementation of our self-developed, successful formula in project management, together with our strong bond with our customers and partners, has enabled us to withstand the up and down market conditions that we experienced in the last two decades.
In the coming year, we believe the construction market in Hong Kong will remain under pressure due to the political environments. Our business has been primarily focusing in the Hong Kong private sector. However, wanton filibustering in the legislative council has led to prolonged delay on granting funds for new public works in the last 2 years, which has driven more and more public sector contractors to tender work in the private sector in order to avoid idling of their resources. As a result, the private sector market has become highly competitive and under fierce competition.
When faced with cut-throat competition among contractors in tendering for new projects which have been widely commented in the media and among peers, we are mindful not to reduce our profit margin without considering the negative impact to our shareholders’ interests. Nevertheless, we remain confident and are well-positioned in the market as our operation model of contracting works allows us flexibility to remain resilient to adverse impact. In this financial year, facing such steep competition, we are still able to be awarded 3 new contracts with an aggregate contract sum of HK$186.3 million.
We are therefore pleased to report that our financial position remained strong and continued to improve. Current ratio increased to 4.8 times and gearing ratio substantially decreased to 1.9% despite an interim dividend of HK$83.0 million being declared and paid during the financial year. With our results being satisfactory overall, our board shall recommend a final dividend of HK$0.1 per share.
Looking ahead, we remain positive about the prospects of the construction market of Hong Kong, with the Government’s continued commitment to infrastructure investments and housing policy by various short, medium and long term land supply initiatives. We will continue to adhere to our strategy of focusing on ‘design and build’ projects and maintaining strong financial position to meet the requirements of future potential projects ahead. Our management team is convinced that we will continue to build value over the medium to long term for our shareholders.
On the behalf of our board, I would like to express our sincere gratitude to our management and all our staff for their hard work and dedication, as well as our shareholders, business associates and other professional parties for their support throughout the year.
Lau Pak Man Chairman
Hong Kong, 23 June 2017