MMG Limited (1208) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Welcome to the 2020 Annual General Meeting of MMG Limited. With the outbreak and spreading of the COVID-19 pandemic, the government had introduced the Prevention and Control of Disease, prohibition on group gathering regulations, Chapter 599G of the laws of Hong Kong with effect from March 29, 2020, to implement social distancing. The regulation has been amended by the Prevention and Control of Disease, prohibition on group gathering amendment #2, Regulation 2020 on May 5, 2020, to safeguard the health and safety of shareholders of the company who may be attending the AGM in person and to promote and maintain social distancing in light of COVID-19 pandemic. The company has adopted certain appropriate measures to manage the number of physical attendees, including the use of live webcast of the AGM proceedings to reduce the headcount at AGM venue. In addition, in lieu of the traveling restrictions imposed by various jurisdictions, including Hong Kong, to prevent the spread of the COVID-19, a total of 3 directors are attending this meeting overseas by video conference. Let me introduce Mr. Leung Cheuk Yan, Chairman, presiding over the meeting. Mr. Leung is an independent nonexecutive director, a member of the audit and risk management committee and a member of the governance, remuneration and nomination committee of the company.

Thank you, Lucia. Good morning, ladies and gentlemen. I would like to take this opportunity to introduce our other directors and the Company Secretary who are joining this meeting by video conference and also on the stage. First, Mr. Gao Xiaoyu, executive director and Chief Executive Officer who is attending this meeting from Melbourne, Australia; Dr. Peter Cassidy, independent nonexecutive director, Chairman of the governance, remuneration and nomination committee and a member of the audit and risk management committee who is attending this meeting from Sydney, Australia; Mr. Chan Ka Keung, Peter, independent nonexecutive director, Chairman of the audit and risk management committee and a member of the governance, remuneration and nomination committee who is attending this meeting from Perth, Australia; and Ms. Lucia Leung, our Company Secretary, who is on the stage with me today. According to Article 53 of the Articles of Association of the company, 2 shareholders present in person or by proxy will constitute a quorum. As the time appointed for this meeting has passed and the quorum is sufficient, I would declare the start of this meeting and call the meeting to order. All shareholders have already received the 2019 annual report of the company and the circular of the company dated April 20, 2020. The notice of this meeting is set out on Pages AGM 1 to AGM 5 of the circular. A total of 7 ordinary resolutions are set out in the notice. If there's no objection from the shareholders present, I propose that we take the notice as read. Is there any objection?

No.

Thank you. Since there's no objection, I declare that the notice of this meeting is taken as read and this meeting shall proceed. The aim of convening this meeting is to pass the 7 resolutions set out in the notice of the meeting. The resolutions will be passed as ordinary resolutions with the number of votes in favor cast by the shareholders present in person, that is individual shareholders or duly authorized representatives of corporate shareholders or present by proxies, representing more than half of the total number of votes cast by such shareholders at this meeting. According to Article 58 of the Articles of Association of the company, a resolution put to the vote at any general meeting of the company shall be decided on a poll. Now before taking the vote by way of poll, let me explain the voting procedures. First, our staff has already distributed the voting form to the shareholders and proxies of shareholders during registration for this meeting; two, voting on all resolutions will begin after motion has been made and seconded for each resolution; three, the representative of the share registrar of the company, Computershare Hong Kong Investor Services Limited, will act as scrutineer of the poll; four, Chairman of the meeting will explain how to complete the voting form; five, shareholders shall return duly completed voting form to the scrutineer; six, the scrutineer will collect all the duly completed voting forms; seven and last, the voting results will not be announced immediately. Such results will be published on the website of the Hong Kong Exchanges and Clearing Limited and of the company as soon as possible within today. In order to expedite the proceedings, all resolutions put to the vote at this meeting shall be decided on a poll after a motion has been made and seconded for each resolution. We now turn to resolution #1 for today's meeting. The first resolution set out in the notice is to receive and consider the audited financial statements and the reports of the directors and of the auditor of the company for the year ended December 31, 2019. The 2019 annual report has been sent to the shareholders. The report of the directors and the independent auditors' report are set out on Pages 51 to 68 and Pages 91 to 96 of the annual report, respectively. If there are no objections from the shareholders present, I propose that the reports of the directors and of the auditor be taken as read. Is there any objection?

No.

Thank you. Since there's no objection, I declare that the reports of the directors and of the auditor are taken as read. Ladies and gentlemen, do you have any questions regarding the audited financial statements, the report of the directors or the report of the auditor of the company for the year ended December 31, 2019? If there's any question, please raise your hand? Since there's no question, I propose a motion that the audited financial statements and the reports of the directors and of the auditor of the company for the year ended December 31, 2019, be received, approved and adopted. Will a shareholder, please, second the motion?

Chairman, I, [ Ching-He Huang ], second the motion.

Thank you. The second resolution set out in the notice of this meeting is to reelect the 4 retiring directors, and each item will be dealt with as a separate resolution. In accordance with Article 98 of the Articles of Association of the company and code provision A.4.2 in Appendix 14 of the rules governing the listing of securities on the Stock Exchange of Hong Kong Limited, Mr. Guo Wenqing, Mr. Gao Xiaoyu and Mr. Jiao Jian will retire by rotation at this meeting, and being eligible, they offer themselves for a reelection. In accordance with Article 77 of the Articles of Association of the company, Mr. Chan Ka Keung, Peter, who was appointed to fill a casual vacancy, will retire at this meeting, and being eligible, offers himself for reelection. Accordingly, a separate resolution will be proposed for each of the retiring directors for reelection as director at this meeting. Details of the personal particulars of the above 4 directors are set out in Appendix 1 to the circular. If there's any question regarding this matter, please, would you raise your hand? Since there's no question, this meeting shall proceed. I would like to propose a motion to reelect Mr. Guo Wenqing as a director of the company. Will a shareholder, please, second the motion?

Chairman, I, [ Cheung Wing Chi ], second the motion.

Thank you. I would like to further propose the motion that Mr. Gao Xiaoyu be reelected as a director of the company. Will a shareholder, please, second the motion?

Chairman, I'm, [ Ching-He Huang ], second motion.

Thank you. I would like to further propose the motion that Mr. Jiao Jian be reelected as a director of the company. Will a shareholder, please, second the motion?

Chairman, I, [ Cheung Wing Chi ], second the motion.

Thank you. I would like to further propose a motion that Mr. Chan Ka Keung, Peter be reelected as the director of the company. Will a shareholder, please, second the motion?

Chairman, I, [ Ching-He Huang ], second the motion.

Thank you. The third resolution set out in the notice of this meeting is to authorize the Board of Directors of the company to fix the remuneration of all the directors of the company. Please note that any directors who are also shareholders of the company are required to abstain from voting on this resolution. If there's any question regarding this matter, please, would you raise your hand? Since there's no question, the meeting shall proceed. I now call upon a shareholder to propose a motion to authorize the Board of Directors of the company to fix the remuneration of all the directors of the company for the year ending December 31, 2020.

Chairman, I [ Cheung Wing Chi ], propose a motion that the Board of Directors of the company will be authorized to fix the remuneration of all the directors of the company for the year ending December 31, 2020.

Thank you. Will a shareholder, please, second the motion?

Chairman, I, [ Ching-He Huang ], second the motion.

Thank you. The fourth resolution set out in the notice of this meeting is to reappoint Deloitte Touche Tohmatsu as the auditor of the company and to authorize the Board of Directors of the company to fix the remuneration of the auditor. Deloitte Touche Tohmatsu will retire at the conclusion of this meeting, and being eligible, offer themselves for reappointment as the auditor of the company. If there's any question regarding this matter, please, would you raise your hand? As there's no question, I now propose a motion that Deloitte Touche Tohmatsu be reappointed as auditor of the company to hold office until the conclusion of the next Annual General Meeting and the Board of Directors be authorized to fix the remuneration of the auditor of the company. Will a shareholder, please, second the motion?

Chairman, I, [ Cheung Wing Chi ], second the motion.

Thank you. The fifth resolution set out in the notice of this meeting is to grant a general and unconditional mandate to the Board of Directors of the company to allot additional shares, not exceeding 20% of the total number of issued shares of the company as at the date of passing this resolution. This mandate will expire at the conclusion of the next Annual General Meeting in accordance with the company's ordinance or at an earlier time. The full text of the resolution is set out in the fifth item of the notice of this meeting. If there's any question regarding this matter, please, would you raise your hand? Since there's no question, I would like to propose a motion to pass resolution #5 as set out in the notice of this meeting as an ordinary resolution. Will a shareholder, please, second the motion?

Chairman, I, [ Ching-He Huang ], second the motion.

Thank you. The sixth resolution set out in the notice of this meeting is to grant a general and unconditional mandate to the Board of Directors of the company to repurchase shares of the company, not exceeding 10% of the total number of issued shares of the company as at the date of passing this resolution. This mandate will expire at the conclusion of the next Annual General Meeting in accordance with the company's ordinance or an earlier time. The explanatory statement of the repurchase mandate is set out in Appendix 2 to the circular, and the full text of the resolution is set out in the sixth item of the notice of this meeting. If there's any question regarding this matter, please raise your hand. As there's no question, I would like to propose a motion to pass resolution #6 as set out in the notice of this meeting as an ordinary resolution. Will shareholder, please, second the motion?

Chairman, I, [ Cheung Wing Chi ], second the motion.

Thank you. The seventh resolution set out in the notice of this meeting is to extend the general mandate of the Board of Directors of the company to issue additional shares by adding the number of shares to be purchased by the company pursuant to the general mandate referred to in resolution #6 to a number of additional shares to be issued by the company pursuant to the general mandate referred to in resolution #5, which have both just been considered at this meeting. The full text of the resolution is set out in the seventh item of the notice of this meeting. If there's any question regarding this matter, please, would you raise your hand? Since there's no question, I would like to propose a motion to pass resolution #7 as set out in the notice of this meeting as an ordinary resolution. Will a shareholder, please, second the motion?

Chairman, I, [ Ching-He Huang ], second the motion.

Thank you. As all the resolutions of this meeting are moved and seconded, I now put all the resolutions to vote. Mr. [ Kingston Wong ] of Computershare Hong Kong Investor Services Limited will act as scrutineer of the poll. Each shareholder of proxy should receive a voting form. If you have not received a form, please raise your hand, so that our staff can distribute the form to you. If your shares are held in different accounts, please complete separate forms. When voting by poll, each shareholder present in person or in the case of a shareholder being a corporation by its duly authorized representative or by proxy shall have 1 vote for each fully paid-up share in the company, of which he or she is the holder. The poll is now taken. Will each shareholder or proxy or representative of a corporate shareholder, please check if the name printed in the upper right-hand corner of the voting form is correct. If it's not, please raise your hand and our staff will assist you. If your name is correct, please tick the relevant box for each resolution. If you wish to cast all your votes in relation to a resolution, please tick the for or against box next to the proposed resolution. If you wish to abstain from voting of all your shares in relating -- in relation to a resolution, please tick the abstain box next to the proposed resolution. If you wish to vote partially in favor of and/or partially against and/or partially abstain from voting a resolution, please insert the relevant number of shares in the For, Against and Abstain box next to the proposed resolution and sign the voting form and hand it to the scrutineer who will come to collect it from you. If any shareholder is not sure about his number of shareholding, please raise your hand, and the scrutineer will assist you. If you do not put a tick or specify the numbers of share in For or Against or Abstain box next to the proposed resolution, your vote will be rendered void. As for proxies, if there's any difference between the vote cast by you now and the authorization given in the proxy form we received from the shareholders, the original authorization shall prevail. If any proxy is not sure about the original authorization, please contact the scrutineer who will assist you. Please note that we'll begin to collect the voting forms now. [Voting]

So the scrutineer has confirmed to me that he has collected all the voting forms. The poll results will be published on the website of the Hong Kong Exchanges and Clearing Limited and of the company as soon as possible within today. Now the items on the agenda of this meeting have been dealt with. Is there any other business to be discussed? Or is there any question? As there's no question from you, I declare this meeting closed. I would like to thank you for your attendance today and for your continued support of the company. Thank you.