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EURO TECH HOLDINGS CO LTD

EURO TECH HOLDINGS CO LTDCLWT财报

Nasdaq · 工业 · 专业及商业设备与用品批发

VA Tech Wabag Ltd. is an Indian multinational company focussed on desalination and water treatment for municipal and industrial users. Founded in Breslau in 1924, the company is headquartered in Chennai.

What changed in EURO TECH HOLDINGS CO LTD's 20-F — 2023 vs 2024

Top changes in EURO TECH HOLDINGS CO LTD's 2024 20-F

270 paragraphs added · 257 removed · 213 edited across 4 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

70 edited+21 added−18 removed246 unchanged
It is also possible that if future outbreak occurs, the government will take similar actions which would adversely impact our business. In addition, the broader macro-economic implications the pandemic, including reduced levels of economic growth and possibly a global recession, likely still exist and will likely impact our future results of operations.
It is also possible that if future outbreak occurs, the government will take similar actions which would adversely impact our business. In addition, the broader macro-economic implications of the pandemic, including reduced levels of economic growth and possibly a global recession, likely still exist and will likely impact our future results of operations.
J&S is headquartered in Malaysia and subject to the inspections by the PCAOB, therefore we believe the appointment of J&S would substantially reduce the risk of us being continued to be identified as “Commission-Identified Issuer” under the HFCAA, and the risk of our securities being prohibited from being traded on a national securities exchange or in the over the counter trading market in the United States due to rules under the HFCAA.
J&S is headquartered in Malaysia and subject to inspections by the PCAOB, therefore we believe the appointment of J&S would substantially reduce the risk of us being continued to be identified as “Commission-Identified Issuer” under the HFCAA, and the risk of our securities being prohibited from being traded on a national securities exchange or in the over the counter trading market in the United States due to rules under the HFCAA.
A non-U.S. corporation will be considered a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes, for any taxable year if either (i) at least 75% of its gross income is passive income or (ii) at least 50% of the value of its assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income.
A non-U.S. corporation will be considered a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes, for any taxable year if either (i) at least 75% of its gross income for such taxable year is passive income or (ii) at least 50% of the value of its assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income.
SAFE Circular No. 37 further requires amendment to the registration in the event of any changes with respect to the basic information of the special purpose vehicle, such as changes in a PRC resident individual shareholder, name or operation period; or any significant changes with respect to the special purpose vehicle, such as increase or decrease of capital contributed by PRC individuals, share transfer or exchange, merger, division or other material event. 18 Table of Contents If the shareholders of the offshore holding company who are PRC residents do not complete their registration with the local SAFE branches, the PRC subsidiaries may be prohibited from distributing their profits and proceeds from any reduction in capital, share transfer or liquidation to the offshore company, and the offshore company may be restricted in its ability to contribute additional capital to its PRC subsidiaries.
SAFE Circular No. 37 further requires amendment to the registration in the event of any changes with respect to the basic information of the special purpose vehicle, such as changes in a PRC resident individual shareholder, name or operation period; or any significant changes with respect to the special purpose vehicle, such as increase or decrease of capital contributed by PRC individuals, share transfer or exchange, merger, division or other material event. 17 Table of Contents If the shareholders of the offshore holding company who are PRC residents do not complete their registration with the local SAFE branches, the PRC subsidiaries may be prohibited from distributing their profits and proceeds from any reduction in capital, share transfer or liquidation to the offshore company, and the offshore company may be restricted in its ability to contribute additional capital to its PRC subsidiaries.
The Personal Information Protection Law, which was promulgated by the Standing Committee of the National People’s Congress on August 20, 2021 and took effect on November 1, 2021, integrates the various rules with respect to personal information rights and privacy protection and applies to the processing of personal information within mainland China as well as certain personal information processing activities outside mainland China, including those for the provision of products and services to natural persons within China or for the analysis and assessment of acts of natural persons within China. 15 Table of Contents We may have access to confidential or personal information in certain of our businesses.
The Personal Information Protection Law, which was promulgated by the Standing Committee of the National People’s Congress on August 20, 2021 and took effect on November 1, 2021, integrates the various rules with respect to personal information rights and privacy protection and applies to the processing of personal information within mainland China as well as certain personal information processing activities outside mainland China, including those for the provision of products and services to natural persons within China or for the analysis and assessment of acts of natural persons within China. 14 Table of Contents We may have access to confidential or personal information in certain of our businesses.
In addition, our product brands, corporate reputation and product sales could be harmed if, for example: · our advertisements, or the advertisements of the owners of the third-party brands that we market or those of our distributors, are deemed to be misleading or inaccurate; · our products fail to meet customer expectations; · we provide poor or ineffective customer service; · our products contain defects or otherwise fail; or · consumers confuse our products with inferior or counterfeit products. 24 Table of Contents We Have Made And May Make Further Acquisitions Without Your Approval.
In addition, our product brands, corporate reputation and product sales could be harmed if, for example: · our advertisements, or the advertisements of the owners of the third-party brands that we market or those of our distributors, are deemed to be misleading or inaccurate; · our products fail to meet customer expectations; · we provide poor or ineffective customer service; · our products contain defects or otherwise fail; or · consumers confuse our products with inferior or counterfeit products. 23 Table of Contents We Have Made And May Make Further Acquisitions Without Your Approval.
Pursuant to Section 404 of SOX, the SEC adopted rules requiring public companies to include a report of management on the Company’s internal controls over financial reporting in their annual reports, including Form 20-F. 32 Table of Contents We expend significant resources in developing and maintaining the necessary documentation and testing procedures required by SOX, there is a risk that we will not maintain compliance with all of these requirements.
Pursuant to Section 404 of SOX, the SEC adopted rules requiring public companies to include a report of management on the Company’s internal controls over financial reporting in their annual reports, including Form 20-F. 31 Table of Contents We expend significant resources in developing and maintaining the necessary documentation and testing procedures required by SOX, there is a risk that we will not maintain compliance with all of these requirements.
Subsequently, these customers will likely take longer to make decisions regarding whether to purchase our products, negotiate for more favorable commercial and financial terms in their dealings with us, and even postpone or cancel their new projects and purchase orders in China. 22 Table of Contents We face risks related to natural disasters, health epidemics and other outbreaks, which could significantly disrupt our operations.
Subsequently, these customers will likely take longer to make decisions regarding whether to purchase our products, negotiate for more favorable commercial and financial terms in their dealings with us, and even postpone or cancel their new projects and purchase orders in China. 21 Table of Contents We face risks related to natural disasters, health epidemics and other outbreaks, which could significantly disrupt our operations.
In January 2012, the Company effected a combination or reverse stock split of its issued ordinary shares, and thereafter, in February 2012, the Company received a letter from NASDAQ advising that it had regained compliance with NASDAQ’s maintenance listing requirements. 31 Table of Contents No assurance can be given that we will continue to meet applicable NASDAQ continued listing standards.
In January 2012, the Company effected a combination or reverse stock split of its issued ordinary shares, and thereafter, in February 2012, the Company received a letter from NASDAQ advising that it had regained compliance with NASDAQ’s maintenance listing requirements. 30 Table of Contents No assurance can be given that we will continue to meet applicable NASDAQ continued listing standards.
The potential conflicts in legal obligations could have adverse impact on our operations in and outside of China. 16 Table of Contents Economic Reforms May Not Continue or Impact Positively On the Company; Changing Business Environment. Over the past several years, the PRC’s government has pursued economic reform policies including encouraging private economic activities and decentralization of economic deregulation.
The potential conflicts in legal obligations could have adverse impact on our operations in and outside of China. 15 Table of Contents Economic Reforms May Not Continue or Impact Positively On the Company; Changing Business Environment. Over the past several years, the PRC’s government has pursued economic reform policies including encouraging private economic activities and decentralization of economic deregulation.
We conduct substantially all of our operations in China and substantially all of our assets are located in China. In addition, our principal offices are located in Hong Kong and all of our directors and executive officers reside within Hong Kong and China.
We conduct substantially all of our operations in China and substantially all of our assets are located in China. In addition, our principal offices are located in Hong Kong and all of our directors and executive officers reside within Hong Kong and mainland China.
These laws and regulations can be complex and the interpretation and application of these laws and regulations are often uncertain, in flux and complicated. 14 Table of Contents The PRC Cybersecurity Law, which took effect in June 2017, generally governs the construction, operation, maintenance and use of networks in China, subjects network operators to various security protection-related obligations.
These laws and regulations can be complex and the interpretation and application of these laws and regulations are often uncertain, in flux and complicated. 13 Table of Contents The PRC Cybersecurity Law, which took effect in June 2017, generally governs the construction, operation, maintenance and use of networks in China, subjects network operators to various security protection-related obligations.
In addition, the affected entity may not be able to recover corporate assets that are sold or transferred out of our control in the event of such a misappropriation if a transferee relies on the apparent authority of the representative and acts in good faith. 19 Table of Contents The PRC Government Imposes Currency Controls.
In addition, the affected entity may not be able to recover corporate assets that are sold or transferred out of our control in the event of such a misappropriation if a transferee relies on the apparent authority of the representative and acts in good faith. 18 Table of Contents The PRC Government Imposes Currency Controls.
The development of the ballast water port solution prototype has now been successfully completed. 23 Table of Contents The Company received its first order for the ballast water port solution system from Shanghai Yanshan port in 2020, and has since completed four other commercial port BWTS projects for Ningbo Zhoushan port, Taicang port, LianYunGang port and Zhangjiang chemical port in China respectively.
The development of the ballast water port solution prototype has now been successfully completed. 22 Table of Contents The Company received its first order for the ballast water port solution system from Shanghai Yanshan port in 2020, and has since completed four other commercial port BWTS projects for Ningbo Zhoushan port, Taicang port, LianYunGang port and Zhangjiang chemical port in China respectively.
Moreover, government actions and civil claims may be filed against us for misleading or inaccurate advertising, fraud, defamation, subversion, negligence, copyright or trademark infringement or other violations due to the nature and content of our advertising produced by us or our distributors. 27 Table of Contents Risks Related To the Company Itself.
Moreover, government actions and civil claims may be filed against us for misleading or inaccurate advertising, fraud, defamation, subversion, negligence, copyright or trademark infringement or other violations due to the nature and content of our advertising produced by us or our distributors. 26 Table of Contents Risks Related To the Company Itself.
Although the determination of PFIC status is subject to factual uncertainties because it depends upon the valuation of our ordinary shares, as well as our goodwill and other assets and income, and because there are uncertainties in the application of the relevant rules, we are uncertain if we would be considered to be a PFIC for 2023.
Although the determination of PFIC status is subject to factual uncertainties because it depends upon the valuation of our ordinary shares, as well as our goodwill and other assets and income, and because there are uncertainties in the application of the relevant rules, we are uncertain if we would be considered to be a PFIC for 2024.
As a result, our business, financial condition and results of operations could be adversely affected and the trading prices of our ordinary shares could decline. 13 Table of Contents The PRC government has also enhanced its regulatory oversight of Chinese companies listing overseas, including enhanced oversight of overseas equity financing and listing by Chinese companies.
As a result, our business, financial condition and results of operations could be adversely affected and the trading prices of our ordinary shares could decline. 12 Table of Contents The PRC government has also enhanced its regulatory oversight of Chinese companies listing overseas, including enhanced oversight of overseas equity financing and listing by Chinese companies.
Any of these events could distract our management’s attention and result in our not obtaining the anticipated benefits of our joint ventures, acquisitions or investments and, in turn, negatively affect the performance of such joint ventures, acquisitions and investments and their respective contributions to our results of operations. 25 Table of Contents Dependence upon Management.
Any of these events could distract our management’s attention and result in our not obtaining the anticipated benefits of our joint ventures, acquisitions or investments and, in turn, negatively affect the performance of such joint ventures, acquisitions and investments and their respective contributions to our results of operations. 24 Table of Contents Dependence upon Management.
CAPITALIZATION AND INDEBTEDNESS This item does not apply to annual reports on Form 20-F. C. REASONS FOR THE OFFER AND USE OF PROCEEDS This item does not apply to annual reports on Form 20-F. 12 Table of Contents D. RISK FACTORS An investment in our shares involves a high degree of risk.
CAPITALIZATION AND INDEBTEDNESS This item does not apply to annual reports on Form 20-F. C. REASONS FOR THE OFFER AND USE OF PROCEEDS This item does not apply to annual reports on Form 20-F. 11 Table of Contents D. RISK FACTORS An investment in our shares involves a high degree of risk.
The value of the IP portfolio is dependent on the successful promotion and market acceptance of standards developed or co-developed by Company. 29 Table of Contents Failure to deal effectively with fraudulent or illegal activities by our employees, business partners or service providers would harm our business.
The value of the IP portfolio is dependent on the successful promotion and market acceptance of standards developed or co-developed by Company. 27 Table of Contents Failure to deal effectively with fraudulent or illegal activities by our employees, business partners or service providers would harm our business.
In addition, as the determination of PFIC status is made on an annual basis and depends on variables over which we have limited control, there can be no assurance that we will not be a PFIC for 2024 or any future years.
In addition, as the determination of PFIC status is made on an annual basis and depends on variables over which we have limited control, there can be no assurance that we will not be a PFIC for 2025 or any future years.
Dollar in the future. 20 Table of Contents Significant revaluation of the Renminbi may have a material and adverse effect on your investment. For example, to the extent that we need to convert U.S. Dollar into Renminbi for our operations, appreciation of the Renminbi against the U.S.
Dollar in the future. 19 Table of Contents Significant revaluation of the Renminbi may have a material and adverse effect on your investment. For example, to the extent that we need to convert U.S. Dollar into Renminbi for our operations, appreciation of the Renminbi against the U.S.
If we are a PFIC in any year, a U.S. holder will be subject to certain adverse United States federal income tax consequences, and is urged to consult with his, her or its tax advisor. See— Item 10.
If we are a PFIC in any year, a U.S. holder may be subject to certain adverse United States federal income tax consequences, and is urged to consult with his, her or its tax advisor. See— Item 10.
A loss of a substantial vendor or substantial number of our other vendors and/or our competing with them would have a material adverse effect on our revenues from trading activities. 26 Table of Contents The loss of any of our key customers could reduce our revenues and our profitability.
A loss of a substantial vendor or substantial number of our other vendors and/or our competing with them would have a material adverse effect on our revenues from trading activities. 25 Table of Contents The loss of any of our key customers could reduce our revenues and our profitability.
On September 14, 2022, the CAC published the Decision of Amending PRC Cybersecurity Law (Draft for Comments), or the Draft Amendment to PRC Cybersecurity Law, which, among other things, aggravated legal liabilities for violations of cybersecurity obligations and critical information infrastructure operators’ obligations.
On September 12, 2022, the CAC published the Decision of Amending PRC Cybersecurity Law (Draft for Comments), or the Draft Amendment to PRC Cybersecurity Law, which, among other things, aggravated legal liabilities for violations of cybersecurity obligations and critical information infrastructure operators’ obligations.
The Board of Directors has the right to fix the rights, terms and preferences at the time of issue of “blank check preferred stock” without further action by our shareholders. 30 Table of Contents Uncertainty of Enforcing United States Judgments.
The Board of Directors has the right to fix the rights, terms and preferences at the time of issue of “blank check preferred stock” without further action by our shareholders. 29 Table of Contents Uncertainty of Enforcing United States Judgments.
The principal reason for the operating losses before income taxes, equity in income of affiliates and non-controlling interests for Fiscal 2023 was primarily an decrease in the gross profit margin of our engineering-related operations.
The principal reason for the operating losses before income taxes, equity in income of affiliates and non-controlling interests for Fiscal 2023 was primarily a decrease in the gross profit margin of our engineering-related operations.
These concerns could have a negative impact on the Company’s results of operations. Far East receives rental income from a property whose title has not yet been obtained by Far East from the PRC authority, which may result in legal proceedings and associated costs, expenses and liabilities.
These concerns could have a negative impact on the Company’s results of operations. Far East receive d rental income from a property whose title has not yet been obtained by Far East from the PRC authority, which may result in legal proceedings and associated costs, expenses and liabilities.
A sustained or increased inflation in the PRC may have an adverse impact on the PRC’s economy and may materially and adversely affect our business and financial results. 17 Table of Contents The PRC legal system embodies uncertainties which could limit the available legal protections and expand the government’s power.
Sustained or increased inflation in the PRC may have an adverse impact on the PRC’s economy and may materially and adversely affect our business and financial results. 16 Table of Contents The PRC legal system embodies uncertainties which could limit the available legal protections and expand the government’s power.
In the event our securities are no longer listed on NASDAQ or are not otherwise exempt from the provisions of the SEC’s “penny stock” rules, such rules may also affect the ability of broker-dealers and investors to sell our securities. 33 Table of Contents We may be considered to be a passive foreign investment company for the 2023 calendar year and may be a passive foreign investment company for future years, which would result in adverse U.S. federal income tax consequences to U.S. holders of our ordinary shares.
In the event our securities are no longer listed on NASDAQ or are not otherwise exempt from the provisions of the SEC’s “penny stock” rules, such rules may also affect the ability of broker-dealers and investors to sell our securities. 32 Table of Contents We may be considered to be a passive foreign investment company for the 202 4 calendar year and may be a passive foreign investment company for future years, which would result in adverse U.S. federal income tax consequences to U.S. holders of our ordinary shares.
The Company faces its principal competition from foreign manufacturers and other distributors of their products situated in Hong Kong and mainland China. Competition may cause purchaser demands for price reductions and reduced profit margin. Dependence on Vendors; Lack of Long Term Arrangements; Loss of Vendors . The Company distributes supplies manufactured by a number of vendors.
The Company faces its principal competition from foreign manufacturers and other distributors of their products situated in Hong Kong and mainland China. Competition may cause purchaser demands for price reductions and reduced profit margin. Dependence on Vendors; Lack of Long Term Arrangements; Loss of Vendors . The Company distributes supplies manufactured by a number of vendors. Stanford Research Systems, Inc.
For the year ended December 31, 2021, sales to our three largest customers amounted in the aggregate to approximately 41% of our total revenue. There can be no assurance that we will maintain or improve the relationships with these customers, or that we will be able to continue to supply these customers at current levels or at all.
For the year ended December 31, 2022, sales to our three largest customers amounted in the aggregate to approximately 33% of our total revenue. There can be no assurance that we will maintain or improve the relationships with these customers, or that we will be able to continue to supply these customers at current levels or at all.
If the PRC rate of inflation continues to increases, the Chinese government may introduce further measures intended to reduce the inflation rate in the PRC. Any such measures adopted by the Chinese government may not be successful in reducing or slowing the increase in the PRC’s inflation rate.
If the inflation rate in China increases, the Chinese government may introduce further measures intended to reduce the inflation rate in the PRC. Any such measures adopted by the Chinese government may not be successful in reducing or slowing the increase in the PRC’s inflation rate.
According to the National Bureau of Statistics of China, China’s real GDP growth rate was 6.1%, 2.3%, 8.1%, 2.9% and 5.2 % in 2019, 2020, 2021, 2022 and 2023, respectively. Any continuing or worsening slowdown could significantly reduce domestic commerce in China.
According to the National Bureau of Statistics of China, China’s real GDP growth rate was 2.3%, 8.1%, 2.9%, 5.2 % and 5.0% in 2020, 2021, 2022, 2023 and 2024, respectively. Any continuing or worsening slowdown could significantly reduce domestic commerce in China.
A substantial number of the Company’s suppliers have been selling their products into China directly and through other distributors. During Fiscal 2021, our sales revenue from trading activities increased by approximately 2%. During Fiscal 2022, our sales revenue from trading activities decreased by approximately 3%. During Fiscal 2023, our sales revenue from trading activities increased by approximately 30%.
A substantial number of the Company’s suppliers have been selling their products into China directly and through other distributors. During Fiscal 2022, our sales revenue from trading activities decreased by approximately 3%. During Fiscal 2023, our sales revenue from trading activities increased by approximately 30%. During Fiscal 2024, our sales revenue from trading activities decreased by approximately 21%.
The property’s book value as of December 31, 2023 was approximately US$80,000. Far East has made an effort to request the developer of the property to assist with obtaining the title, but those efforts have failed.
The property’s book value as of December 31, 2024 was approximately US$76,000. Far East has made an effort to request the developer of the property to assist with obtaining the title, but those efforts have failed.
An economic downturn, whether actual or perceived, a further decrease in economic growth rates or an otherwise uncertain economic outlook in China or any other market in which we may operate could have a material adverse effect on our business, financial condition and results of operations. We May be Impacted by Inflation in PRC .
An economic downturn, whether actual or perceived, a further decrease in economic growth rates or an otherwise uncertain economic outlook in China or any other market in which we may operate could have a material adverse effect on our business, financial condition and results of operations.
We are subject to a variety of litigation and similar proceedings in the course of our business that could adversely affect our financial statements.
We may be subject to a variety of litigation and similar proceedings in the course of our business that could adversely affect our financial statements.
Since January 2023, the Chinese government has gradually lifted restrictions and quarantines that were imposed in response to the pandemic and has now completed lifted such restrictions and quarantines.
The Chinese government has gradually lifted restrictions and quarantines that were imposed in response to the pandemic since 2023, and has now completely lifted such restrictions and quarantines.
For the year ended December 31, 2023, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue. For the year ended December 31, 2022, sales to our three largest customers amounted in the aggregate to approximately 33% of our total revenue.
For the year ended December 31, 2024, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue. For the year ended December 31, 2023, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue.
A substantial part of our operations is in China through our subsidiaries. Our ability to operate in China may be impaired by changes in Chinese laws and regulations, including those relating to taxation, environmental regulation, restrictions on foreign investment, and other matters.
A substantial portion of our operations are located in China through our subsidiaries. Our ability to operate in China may be impaired by changes in Chinese laws and regulations, including those relating to taxation, environmental regulation, restrictions on foreign investment, and other matters.
However we cannot assure you that Chinese regulatory authorities would never disallow our holding company structure, or otherwise prohibit or restrict the Company from holding the equity of Far East, Yixing or Blue Sky.
However we cannot assure you that Chinese regulatory authorities would never disallow our holding company structure, or otherwise prohibit or restrict the Company from holding the equity of Euro Tech Global, Far East, Pact Singapore, Yixing, Pact or Blue Sky.
After giving effect to the net income attributable to non-controlling interest, other comprehensive income/(loss) and comprehensive loss attributable to non-controlling interest, we had comprehensive income attributable to the Company of US$925,000 for Fiscal 2021.
After giving effect to the net loss attributable to non-controlling interest, other comprehensive income / (loss) and comprehensive loss attributable to non-controlling interest, we had comprehensive income attributable to the Company of US$715,000 for Fiscal 2024.
Thermo Fisher Scientific Group (“Thermo”), Stanford Research Systems, Inc. (“Stanford”), Hach Company (“Hach”), and Hioki E.E. Corp. (“Hioki”) are among the Company’s largest suppliers in 2023, pursuant to short term arrangements.
(“Stanford”), Thermo Fisher Scientific Group (“Thermo”), Hach Company (“Hach”), and Hioki E.E. Corp. (“Hioki”) are among the Company’s largest suppliers in 2024, pursuant to short term arrangements.
The trading price for our ordinary shares has been volatile and is likely to continue to fluctuate widely in response to a variety of factors, many of which are beyond our control.
The trading price for our ordinary shares may be volatile and could fluctuate widely in response to a variety of factors, many of which are beyond our control.
Moreover, rising inflation could result in higher costs of services and supplies and a decrease in consumer spending, which could negatively affect our business operations and financial results.
Moreover, although currently China economy is not experiencing significant inflation, future rising inflation could result in higher costs of services and supplies and a decrease in consumer spending, which could negatively affect our business operations and financial results.
Health and Safety: Increased concerns regarding the safe use of chemicals and plastics in commerce and their potential impact on the environment as well as perceived impacts of plant biotechnology on health and the environment have resulted in more restrictive regulations and could lead to new regulations.
Accordingly, environmental, health or safety regulatory matters could result in significant unanticipated costs or liabilities. 28 Table of Contents Health and Safety: Increased concerns regarding the safe use of chemicals and plastics in commerce and their potential impact on the environment as well as perceived impacts of plant biotechnology on health and the environment have resulted in more restrictive regulations and could lead to new regulations.
In the years ended December 31, 2021, 2022 and 2023, we had 2, 1 and 2 customers that accounted for 10% or more of our revenues, respectively.
In the years ended December 31, 2022, 2023 and 2024, we had 1, 2 and 1 customers that accounted for 10% or more of our revenues, respectively. Customer Name Year Ended December 31,202 4 Year Ended December 31,202 3 Year Ended December 31,202 2 Customer A 15 % 10 % N.A .
Our operating results historically have been difficult to predict and have at times significantly fluctuated from year to year due to a variety of factors, many of which are outside of our control.
We Cannot be Certain that we will Achieve or Maintain Profitability in the Future. Our operating results historically have been difficult to predict and have at times significantly fluctuated from year to year due to a variety of factors, many of which are outside of our control.
Customer Name Year Ended December 31,2023 Year Ended December 31,2022 Year Ended December 31,2021 Customer A 14 % 18 % 15 % Customer B 10 % N.A. 17 % Our continued failure to maintain long-term relationships with any of these major customers would lead to continued loss of our sales to them, which would have an adverse effect on our business, financial condition and results of operations.
Customer B 9 % 14 % 18 % Our failure to maintain long-term relationships with any of these major customers would lead to the loss of our sales to such major customer, which would have an adverse effect on our business, financial condition and results of operations.
As of the date of this annual report, such administration regulations have not been adopted. In January 2022, the CAC and several other administrations also jointly promulgated the amended Cybersecurity Review Measures, or the Cybersecurity Review Measures, which became effective on February 15, 2022, and supersede and replace the current cybersecurity review measures that became effective since June 2020.
Additionally, in November 2021, the CAC and several other administrations also jointly promulgated the amended Cybersecurity Review Measures, or the Cybersecurity Review Measures, which became effective on February 15, 2022, and supersede and replace the current cybersecurity review measures that became effective since June 2020.
It owns 100% of the shares of Far East, which owns 100% of the equity of ETTS and SET in China, and 58% of the equity of Yixing in China and 58% of the equity of Pact in the British Virgin Islands. Far East also holds 19.4% of the equity of Blue Sky in China.
It owns 100% of the shares of Euro Tech Global, which owns 100% of the shares of Far East. Far East owns 100% of the equity of ETTS in China, and 58% of the equity of Pact Singapore in Singapore, Yixing in China and Pact in the British Virgin Islands, respectively.
Pursuant to the HFCAA, if the SEC determines that we have filed audit reports issued by a registered public accounting firm that the PCAOB is unable to inspect or investigate completely for three consecutive years beginning in 2021, the SEC may prohibit our shares from being traded on a national securities exchange or in the over-the-counter market in the United States.
Pursuant to the Holding Foreign Companies Accountable Act, or the HFCAA, if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspections by the Public Company Accounting Oversight Board, or the PCAOB, for two consecutive years, the SEC will prohibit our shares from being traded on a national securities exchange or in the over-the-counter trading market in the United States.
ETTS and SET are no longer in active business operations. Far East, Yixing, Pact and Blue Sky are engaged in active business operations. As of the date of this annual report, Chinese law does not prohibit or restrict the Company from holding the equity of Far East, Yixing or Blue Sky.
As of the date of this annual report, Chinese law does not prohibit or restrict the Company from holding the equity of Euro Tech Global, Far East, Pact Singapore, Yixing, Pact or Blue Sky.
The value of the Renminbi against the U.S. Dollar and other currencies is affected by changes in China’s political and economic conditions and by China’s foreign exchange policies, among other things. In 2019, the Renminbi further depreciated by approximately 1.3% against the U.S. dollar. In 2020, the value of the Renminbi appreciated by approximately 6.3% against the U.S. dollar.
The value of the Renminbi against the U.S. Dollar and other currencies is affected by changes in China’s political and economic conditions and by China’s foreign exchange policies, among other things. The RMB/USD exchange rate experienced significant volatility in 2020. It started the year around 6.9 RMB per USD and depreciated to around 7.1 by March.
During Fiscal 2021, the Company had revenues of US$21,388,000, operating income of US$771,000, and income before income taxes, equity in income of affiliates and non-controlling interests of US$921,000. In addition, we had income tax credit of US$90,000, equity in income of affiliates of US$355,000.
During Fiscal 2024, the Company had revenues of US$15,383,000, operating income of US$386,000, and income before income taxes, equity in income of affiliates and non-controlling interests of US$519,000. In addition, we had income tax expense of US$72,000, and equity in income of affiliates of US$398,000.
However, there can be no assurance that changes in political or economic conditions in Hong Kong and the PRC will not affect the Company adversely. The Company’s results of operations and financial condition may be influenced by the political situation in Hong Kong and by the general state of the Hong Kong economy.
However, there can be no assurance that changes in political or economic conditions in Hong Kong and mainland China will not affect the Company adversely.
Alternatively, relevant governmental authorities in the PRC may initiate cybersecurity review if they determine an operator’s network products or services or data processing activities affect or may affect national security.
Alternatively, relevant governmental authorities in the PRC may initiate cybersecurity review if they determine an operator’s network products or services or data processing activities affect or may affect national security. On September 24, 2024, the State Council of China issued the Cyber Data Security Administration Regulations, which came into effect on January 1, 2025.
In January 2023, we appointed J&S Associate PLT, or J&S, as our independent registered public accounting firm for the fiscal year ending December 31, 2022 and J&S remains our independent registered public accounting firm for the fiscal year ending December 31, 2023.
In January 2023, we appointed J&S Associate PLT (“J&S”), as our independent registered public accounting firm.
As a result, we had a net income of US$1,366,000 for Fiscal 2021 before giving effect to the effect on our results attributable to our non-controlling interests. The principal reason for the operating income before income taxes, equity in income of affiliates and non-controlling interests for Fiscal 2021 was the increase in revenues and decrease in selling and administrative expenses.
As a result, we had a net income of US$845,000 for Fiscal 2024 before giving effect to the effect on our results attributable to our non-controlling interests.
Far East has been earning annual rental income on a property in Beijing, China, which was expected to amount to US$38,000 annually as per the latest agreement. Far East has made payment for such property, but has not successfully obtained Certificate of Real Estate Ownership, and thus title, of such property from the PRC authority.
Far East received rental income on a property located in Beijing, China pursuant to relevant lease agreements. The latest lease agreement relating to such property has expired in November, 2024. Far East has made payment for the purchase of such property, but has not successfully obtained Certificate of Real Estate Ownership or title of such property from the PRC authority.
Specifically, the Company has reduced the number of its employees, consolidated its offices, and ceased the active business operations of its two wholly-owned subsidiaries in mainland China, namely, ETTS and SET, due to their decline in profitability.
Specifically, the Company has reduced the number of its employees, consolidated its offices, and ceased the active business operations of certain subsidiaries in mainland China due to their decline in profitability. The Company has also made an effort to obtain appropriate certifications and approvals from various governmental authorities in order to increase the credibility of its products.
The foregoing is raising concerns that civil liberties in Hong Kong may be eroded in the years to come. At this point in time it is not possible to predict if this trend will continue and what effect it will have on the Company, if any.
However, there has been some frictions between Hong Kong residents pressing for greater democracy and the PRC government. At this point in time it is not possible to predict if this trend will continue and what effect it will have on the Company, if any.
In recent years, the average inflation rate has increased by 2.9%, 2.5%, 0.9%, 2% and 0.2 % in 2019, 2020, 2021, 2022 and 2023, respectively. Efforts by the PRC to curb inflation may also curb economic growth, increase our overhead costs and adversely affect our revenues. Inflationary increases cause a corresponding increase in our general overhead.
Efforts by the PRC to curb inflation may also curb economic growth, increase our overhead costs and adversely affect our revenues.
The turbulent relations between the PRC and United States may adversely affect our business or the price of our capital stock Recently, the United States and China have imposed new or higher tariffs on goods imported from the other’s country, and have threatened the imposition of additional tariffs in retaliation.
The United States have imposed additional or higher tariffs on certain products imported from China, and China has also imposed or threatened to impose additional or higher tariffs in retaliation. Part of our business consists of distributing products originated from the United States to China.
Chinese regulatory authorities could disallow our holding company structure The Company is a holding company and not an operating company.
Countries impose, modify, and remove tariffs and other trade restrictions in response to a diverse array of factors, including global and national economic and political conditions. Chinese regulatory authorities could disallow our holding company structure The Company is a holding company and not an operating company.
The Company has also made an effort to obtain appropriate certifications and approvals from various governmental authorities in order to increase the credibility of its products. For example, the Company has obtained certification from China’s Classification Society (“CCS”); has obtained certification from the U.S.
For example, the Company has obtained certification from China’s Classification Society (“CCS”); has obtained certification from the U.S.
As a result, fluctuations in exchange rates may have a material adverse effect on your investment.
As a result, fluctuations in exchange rates may have a material adverse effect on your investment. The turbulent relations between the PRC and United States may adversely affect our business or the price of our capital stock In recent years, we have observed increasing tensions in the relations between the United States and China.
On December 2, 2021, the SEC adopted final amendments implementing the disclosure and submission requirements under the HFCAA, pursuant to which the SEC would identify a “Commission-Identified Issuer” if an issuer has filed an annual report containing an audit report issued by a registered public accounting firm that the PCAOB has determined it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction, and will then impose a trading prohibition on an issuer after it is identified as a “Commission-Identified Issuer” for three consecutive years. 28 Table of Contents On December 16, 2021, the PCAOB issued its determination that the PCAOB is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, because of positions taken by PRC authorities in those jurisdictions, and the PCAOB included in the report of its determination a list of the accounting firms that are headquartered in mainland China or Hong Kong.
On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China or Hong Kong. The PCAOB included in such report a list of the accounting firms that are headquartered in mainland China or Hong Kong.
Differences between the United States and PRC governments on some political issues continue occasionally to color their relationship. These occasional controversies could materially and adversely affect our business and operations. Political or trade friction between the two countries could also materially and adversely affect the market price of our capital stock, whether or not they adversely affect our business.
As China imposes additional or higher tariffs on such imports, our Chinese customers may decrease or may have already decreased their purchase of such products. Subsequently, our sales and results of operations would be adversely impacted. Political or trade friction between the two countries could also materially and adversely affect the market price of our capital stock.
Removed
Additionally, in November 2021, the CAC issued the Cyber Data Security Administration Regulations (Draft for Comments), which, among other things, stipulates that a data processor that process “important data” or listed overseas must conduct an annual data security review by itself or by engaging a data security service provider and submit the annual data security review report for a given year to the relevant municipal counterpart of the CAC before January 31 of the following year.
Added
The regulations specify that China will enhance the protection of important data. Data processors are required to conduct a risk assessment before providing, entrusting, or jointly processing important data, except in cases where such actions are necessary to fulfill statutory duties or obligations.
Removed
In 2021, the value of the Renminbi further appreciated by approximately 2.3% against the U.S. dollar. In 2022, the Renminbi depreciated by approximately 4.1% against the U.S. dollar. In 2023, the Renminbi depreciated by approximately 4.55% against the U.S. dollar.
Added
Furthermore, if cyber data processors operating within China need to transfer important data collected or generated domestically to overseas, they must undergo a data export security assessment organized by CAC.
Removed
The adoption and expansion of trade restrictions and tariffs, quotas and embargoes, the occurrence of a trade war, or other governmental action related to tariffs or trade agreements or policies, has the potential to adversely impact costs and the world economy in general, which in turn could have a material adverse effect on our business, results of operations and financial condition.
Added
We can provide no assurance that we will not be affected by higher rates of inflation in the future . The inflation rate in China was 2.42%, 0.99%, 1.96%, 0.24% and 0.24% in 2020, 2021, 2022, 2023 and 2024, respectively.
Removed
In addition, changes in trade relations between the United States and China may trigger negative customer sentiment or retaliation towards companies in China with ties to the United States, potentially resulting in a negative impact on our results of operations and financial condition.
Added
The Company cannot determine the precise effect of inflation on its operations; however, it does not believe inflation has had a material effect on revenues or results of operations during the past several years. We can provide no assurance that we will not be affected by higher rates of inflation in the future.
Removed
There is friction between Hong Kong residents pressing for greater democracy and the PRC government. There appears to be a suspicion that Hong Kong’s democracy advocates are being manipulated by the United States to cause difficulties at China’s doorstep as regional tensions rise.
Added
However, it strengthened throughout the second half of the year 2020, ending around 6.5 RMB per USD by December, 2020. In 2021, the RMB generally maintained a strengthening trend against the USD. 2022 saw increased volatility in the RMB/USD exchange rate. The RMB started the year around 6.37 and experienced significant depreciation throughout the year, reaching around 7.2 by October.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

72 edited+19 added−13 removed170 unchanged
See – “Glossary.” Pact-Yixing, in which Far East holds 58% equity interests, provides customers with solutions to engineering problems as well as ballast water treatment technology. Pact-Yixing conducts industrial water and waste-water treatment projects, mostly for large multinational manufacturing facilities located in the PRC that are run by companies based in the U.S., Europe and Japan.
See – “Glossary.” Yixing, in which Far East holds 58% equity interests, provides customers with solutions to engineering problems as well as ballast water treatment technology. Yixing conducts industrial water and waste-water treatment projects, mostly for large multinational manufacturing facilities located in the PRC that are run by companies based in the U.S., Europe and Japan.
As for waste-water treatment, Pact-Yixing design and build biological treatment systems, oil coalescers, dissolved air flotation, lamella clarifiers, chemical reactor tanks, ultrafiltration, microfiltration, dewatering systems and package type mobile sewage treatment plants. Biological treatment plants cover both aerobic and anaerobic processes. State-of-the-art aerobic processes of SBR (sequential batch reactors) and MBR (membrane biological reactors) are technologies also covered by Pact-Yixing.
As for waste-water treatment, Yixing design and build biological treatment systems, oil coalescers, dissolved air flotation, lamella clarifiers, chemical reactor tanks, ultrafiltration, microfiltration, dewatering systems and package type mobile sewage treatment plants. Biological treatment plants cover both aerobic and anaerobic processes. State-of-the-art aerobic processes of SBR (sequential batch reactors) and MBR (membrane biological reactors) are technologies also covered by Yixing.
In August 2020, the PRC’s Ministry of Transport (“MT”) issued the “Measures for the Prevention and Control of Water Pollution from Inland River Vessels under 400 GT”, which requires that ships generating domestic sewage should set up treatment devices or storage facilities and equipment to prevent domestic sewage from polluting the water, and port management departments and maritime management agencies should also urge port and shipping enterprises to speed up the construction and renovation of facilities. 42 Table of Contents Subsequently, in March 2021, MT, together with MEE and other departments, issued the “Opinions on Establishing a Long-term Mechanism for the Prevention and Control of Pollution from Ships and Ports in the Yangtze River Economic Zone,” which states that China will complete such renovation involving ships to prevent domestic sewage from polluting the water by the end of May 2022, thereby implementing the relevant requirements of the Water Pollution Prevention and Control Law of PRC and the Yangtze River Protection Law of PRC.
In August 2020, the PRC’s Ministry of Transport (“MT”) issued the “Measures for the Prevention and Control of Water Pollution from Inland River Vessels under 400 GT”, which requires that ships generating domestic sewage should set up treatment devices or storage facilities and equipment to prevent domestic sewage from polluting the water, and port management departments and maritime management agencies should also urge port and shipping enterprises to speed up the construction and renovation of facilities. 40 Table of Contents Subsequently, in March 2021, MT, together with MEE and other departments, issued the “Opinions on Establishing a Long-term Mechanism for the Prevention and Control of Pollution from Ships and Ports in the Yangtze River Economic Zone,” which states that China will complete such renovation involving ships to prevent domestic sewage from polluting the water by the end of May 2022, thereby implementing the relevant requirements of the Water Pollution Prevention and Control Law of PRC and the Yangtze River Protection Law of PRC.
Pact-Yixing also conducts process design projects for its clients. With respect to the process design projects, the procedures involving mechanical and electrical engineering are completed in-house and the procedures involving manufacturing are contracted to approved fabricators of components. Fabrication drawings are also done in-house for submittal to said fabricators under the supervision of Pact-Yixing’s quality control engineers.
Yixing also conducts process design projects for its clients. With respect to the process design projects, the procedures involving mechanical and electrical engineering are completed in-house and the procedures involving manufacturing are contracted to approved fabricators of components. Fabrication drawings are also done in-house for submittal to said fabricators under the supervision of Yixing’s quality control engineers.
We dissolved Shanghai Environmental in 2021. During Fiscal 2022, there was slight decrease in revenues from trading and manufacturing activities. Revenue from Pact-Yixing in Fiscal 2022 was US$5,617,000. Pact-Yixing had an operating income of US$590,000 from engineering activities in Fiscal 2022. We ceased the operation of Shanghai Euro Tech Limited in 2022.
We dissolved Shanghai Environmental in 2021. During Fiscal 2022, there was slight decrease in revenues from trading and manufacturing activities. Revenue from Pact-Yixing in Fiscal 2022 was US$5,617,000. Pact-Yixing had an operating income of US$590,000 from engineering activities in Fiscal 2022. We ceased the operation of Shanghai Euro Tech Limited and ETTS in 2022.
See – Item 3D. “Key Information — Risk Factors.” Our Growth Strategy We are focusing our trading activities in Hong Kong, Macau and Guangdong, China. These cities are located close to our Hong Kong headquarters, which makes it easier to provide customer support to customers located in these cities.
See – Item 3D. “Key Information — Risk Factors.” Our Growth Strategy First, we are focusing our trading activities in Hong Kong, Macau and Guangdong, China. These cities are located close to our Hong Kong headquarters, which makes it easier to provide customer support to customers located in these cities.
Pursuant to foreign exchange laws and regulations, the above-mentioned foreign exchange registration with the banks will typically take less than four weeks upon the acceptance of the registration application. 49 Table of Contents Based on the foregoing, if we intend to provide funding to our wholly foreign owned subsidiaries through capital injection at or after their establishment, we shall register the establishment of and any follow-on capital increase in our wholly foreign owned subsidiaries with the SAMR or its local counterparts, file such via the foreign investment comprehensive management information system and register such with the local banks for the foreign exchange related matters.
Pursuant to foreign exchange laws and regulations, the above-mentioned foreign exchange registration with the banks will typically take less than four weeks upon the acceptance of the registration application. 46 Table of Contents Based on the foregoing, if we intend to provide funding to our wholly foreign owned subsidiaries through capital injection at or after their establishment, we shall register the establishment of and any follow-on capital increase in our wholly foreign owned subsidiaries with the SAMR or its local counterparts, file such via the foreign investment comprehensive management information system and register such with the local banks for the foreign exchange related matters.
SAFE Circular 59 also simplified foreign exchange-related registration required for the foreign investors to acquire the equity interests of Chinese companies and further improve the administration on foreign exchange settlement for foreign-invested enterprises. 48 Table of Contents Pursuant to the Circular on Further Simplifying and Improving the Foreign Currency Management Policy on Direct Investment, or SAFE Circular 13, which was promulgated by SAFE on February 13, 2015 and took effect on June 1, 2015, and was later amended on December 30, 2019, which cancels the administrative approvals of foreign exchange registration of direct domestic investment and direct overseas investment and simplifies the procedure of foreign exchange-related registration, the investors shall register with banks for direct domestic investment and direct overseas investment.
SAFE Circular 59 also simplified foreign exchange-related registration required for the foreign investors to acquire the equity interests of Chinese companies and further improve the administration on foreign exchange settlement for foreign-invested enterprises. 45 Table of Contents Pursuant to the Circular on Further Simplifying and Improving the Foreign Currency Management Policy on Direct Investment, or SAFE Circular 13, which was promulgated by SAFE on February 13, 2015 and took effect on June 1, 2015, and was later amended on December 30, 2019, which cancels the administrative approvals of foreign exchange registration of direct domestic investment and direct overseas investment and simplifies the procedure of foreign exchange-related registration, the investors shall register with banks for direct domestic investment and direct overseas investment.
The circular may be determined by the tax authorities to be applicable to our offshore transactions or sale of our shares or those of our offshore subsidiaries where non-resident enterprises, being the transferors, were involved. 51 Table of Contents Regulations on Employment and Social Welfare Labor Contract Law The PRC Labor Contract Law which took effect on January 1, 2008 and was amended on December 28, 2012, is primarily aimed at regulating rights and obligations of employer and employee relationships, including the establishment, performance and termination of labor contracts.
The circular may be determined by the tax authorities to be applicable to our offshore transactions or sale of our shares or those of our offshore subsidiaries where non-resident enterprises, being the transferors, were involved. 48 Table of Contents Regulations on Employment and Social Welfare Labor Contract Law The PRC Labor Contract Law which took effect on January 1, 2008 and was amended on December 28, 2012, is primarily aimed at regulating rights and obligations of employer and employee relationships, including the establishment, performance and termination of labor contracts.
With respect to the water treatment side of Pact-Yixing’s business, they design and build filtration equipment, ion-exchange softeners and demineralizers, reverse osmosis, electro-deionization, chemical treatment systems and package type mobile water treatment plants.
With respect to the water treatment side of Yixing’s business, they design and build filtration equipment, ion-exchange softeners and demineralizers, reverse osmosis, electro-deionization, chemical treatment systems and package type mobile water treatment plants.
According to the Announcement on Relevant Policies for Deepening Value-Added Tax Reform, with effect from April 1, 2019, the VAT tax rate of 16% and 10% are changed into 13% and 9%, respectively. 50 Table of Contents As of the date of this annual report, our mainland China subsidiaries are generally subject to 3%, 6%, 9% or 13% VAT rate and related surcharges.
According to the Announcement on Relevant Policies for Deepening Value-Added Tax Reform, with effect from April 1, 2019, the VAT tax rate of 16% and 10% are changed into 13% and 9%, respectively. 47 Table of Contents As of the date of this annual report, our mainland China subsidiaries are generally subject to 3%, 6%, 9% or 13% VAT rate and related surcharges.
Furthermore, the law provides that personal information processors who use personal information to make automated decisions should ensure the transparency of decision-making and the fairness and impartiality of the results, and must not impose unreasonable differential treatment on individuals in terms of transaction prices and other transaction conditions. 47 Table of Contents In addition, the law provides rules for cross-border provision of personal information.
Furthermore, the law provides that personal information processors who use personal information to make automated decisions should ensure the transparency of decision-making and the fairness and impartiality of the results, and must not impose unreasonable differential treatment on individuals in terms of transaction prices and other transaction conditions. 44 Table of Contents In addition, the law provides rules for cross-border provision of personal information.
These individuals are paid a salary plus a sales-based commission. Our sales staff assists customers in selecting the equipment, auxiliary parts and products to suit customer specifications. Major Customers Maintaining major customers is important to us. For the year ended December 31, 2023, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue.
These individuals are paid a salary plus a sales-based commission. Our sales staff assists customers in selecting the equipment, auxiliary parts and products to suit customer specifications. Major Customers Maintaining major customers is important to us. For the year ended December 31, 2024, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue.
The Company’s technical support staff provides customers with maintenance, installation assistance, and calibration services, and assists sales personnel in giving technical advice to and performing product demonstrations for customers. The Company derived approximately 1.6%, 2.4% and 1.9% of its revenues from technical support operations during Fiscal 2023, 2022 and 2021 respectively. Customers.
The Company’s technical support staff provides customers with maintenance, installation assistance, and calibration services, and assists sales personnel in giving technical advice to and performing product demonstrations for customers. The Company derived approximately 1.9%, 1.6%, and 2.4% of its revenues from technical support operations during Fiscal 2024, 2023, and 2022 respectively. Customers.
The opinions and any related implementing rules to be enacted may subject us to compliance requirement in the future. 52 Table of Contents Furthermore, on February 17, 2023, the CSRC published the Interim Administrative Measures on Overseas Securities Offering and Listing by the Domestic Enterprises, or the Overseas Listing Measures, which took effect on March 31, 2023.
The opinions and any related implementing rules to be enacted may subject us to compliance requirement in the future. 49 Table of Contents Furthermore, on February 17, 2023, the CSRC published the Interim Administrative Measures on Overseas Securities Offering and Listing by the Domestic Enterprises, or the Overseas Listing Measures, which took effect on March 31, 2023.
See – “Glossary.” 40 Table of Contents Customers for the analytical instruments include government agencies, academic and research institutions, major laboratories and beverage producers, including analytical system to the Hong Kong Government Laboratory for analysis of persistent organic pollutants (POPs) and pesticides in the environment. Customers for water quality monitoring instruments also include government agencies.
See – “Glossary.” 38 Table of Contents Customers for the analytical instruments include government agencies, academic and research institutions, major laboratories and beverage producers, including analytical system to the Hong Kong Government Laboratory for analysis of persistent organic pollutants (POPs) and pesticides in the environment. Customers for water quality monitoring instruments also include government agencies.
Construction of our treatment systems is typically slower during winter seasons due to inclement weather and around Chinese holidays due to the closure of government agencies and other facilities. 43 Table of Contents Litigation From time to time, we are subject to legal proceedings, investigations and claims incidental to the conduct of our business.
Construction of our treatment systems is typically slower during winter seasons due to inclement weather and around Chinese holidays due to the closure of government agencies and other facilities. 41 Table of Contents Litigation From time to time, we are subject to legal proceedings, investigations and claims incidental to the conduct of our business.
Pact-Yixing’s clients come from a varied spectrum of industries covering semiconductor, pharmaceutical, petrochemicals, auto and auto parts, steel, food and beverage and beauty products. 37 Table of Contents The water and waste-water treatment processes applied at Pact-Yixing cover chemical, physical, biological and membrane separation. Combinations of those processes are normally used to treat a specific industrial process feed or effluent.
Yixing’s clients come from a varied spectrum of industries covering semiconductor, pharmaceutical, petrochemicals, auto and auto parts, steel, food and beverage and beauty products. 35 Table of Contents The water and waste-water treatment processes applied at Yixing cover chemical, physical, biological and membrane separation. Combinations of those processes are normally used to treat a specific industrial process feed or effluent.
Sales and Marketing The Company distributes products through its principal office located in Hong Kong. Our main marketing channels are through the work of our marketing and sales force. For Fiscal 2023, 2022 and 2021, the Company had a marketing and sales force consisting of 7, 7 and 11 individuals respectively.
Sales and Marketing The Company distributes products through its principal office located in Hong Kong. Our main marketing channels are through the work of our marketing and sales force. For Fiscal 2024, 2023 and 2022, the Company had a marketing and sales force consisting of 11, 7 and 7 individuals respectively.
Blue Sky’s net income decreased in Fiscal 2021 as compared to Fiscal 2020, increased in Fiscal 2022 as compared to Fiscal 2021, and increased in Fiscal 2023 as compared to Fiscal 2022. Blue Sky listed its shares on the New Third Board in the PRC since November 17, 2015.
Blue Sky’s net income increased in Fiscal 2022 as compared to Fiscal 2021, increased in Fiscal 2023 as compared to Fiscal 2022, and decreased in Fiscal 2024 as compared to Fiscal 2023. Blue Sky listed its shares on the New Third Board in the PRC since November 17, 2015.
On January 1, 2024, the Chinese legislature promulged the Amendment to the Marine Environmental Protection Law, pursuant to which China is strengthening the supervision and management of marine environment pollution from ships in the port area.
On January 1, 2024, the Chinese legislature implemented the Amendment to the Marine Environmental Protection Law, pursuant to which China is strengthening the supervision and management of marine environment pollution from ships in the port area.
Regulations Regulations on Corporate Governance On December 29, 2023, the Standing Committee of the National People’s Congress promulgated the amended PRC Company Law, or the Amended PRC Company Law, which will come into effect on July 1, 2024, to supersede the existing PRC Company Law which was previously amended in October 2018.
Regulations Regulations on Corporate Governance On December 29, 2023, the Standing Committee of the National People’s Congress promulgated the amended PRC Company Law, or the Amended PRC Company Law, which came into effect on July 1, 2024, to supersede the existing PRC Company Law which was previously amended in October 2018.
BUSINESS OVERVIEW 36 Table of Contents Principal Activities The Company has primarily been a distributor of a wide range of advanced water treatment equipment, laboratory instruments, analyzers, test kits and related supplies and power generation equipment (including recorders and power quality analyzers).
BUSINESS OVERVIEW Principal Activities The Company has primarily been a distributor of a wide range of advanced water treatment equipment, laboratory instruments, analyzers, test kits and related supplies and power generation equipment (including recorders and power quality analyzers).
The source of such income contribution in Fiscal 2023 consisted primarily of non-recurrent income from the disposal of 2 desulfurization treatment plants for a “Build-operate-transfer” project located in Shanxi, China. In Fiscal 2022, Blue Sky made an income contribution of US$413,000 to the Company. The source of such income contribution in Fiscal 2022 was operating income.
In Fiscal 2023, Blue Sky made an income contribution of US$1,927,000 to the Company. The source of such income contribution in Fiscal 2023 consisted primarily of non-recurrent income from the disposal of 2 desulfurization treatment plants for a “Build-operate-transfer” project located in Shanxi, China. In Fiscal 2022, Blue Sky made an income contribution of US$413,000 to the Company.
Revenue in Hong Kong, expressed as a percentage of our revenue, increased by 11% in Fiscal 2022 as compared with Fiscal 2021 because of a decrease in revenue in mainland China. Revenue in Hong Kong, expressed as a percentage of our revenue, increased by 7% in Fiscal 2023 as compared with Fiscal 2022. See – Item 3D.
Revenue in Hong Kong, expressed as a percentage of our revenue, increased by 11% in Fiscal 2022 as compared with Fiscal 2021 because of a decrease in revenue in mainland China, increased by 7% in Fiscal 2023 as compared with Fiscal 2022, and decreased by 11% in Fiscal 2024 as compared with Fiscal 2023. See – Item 3D.
Revenue in mainland China, expressed as a percentage of total revenue, decreased by 23% in Fiscal 2022 as compared with Fiscal 2021 because of a decrease in revenue from completion of engineering projects in mainland China. Revenue in mainland China, expressed as a percentage of total revenue, increased by 1% in Fiscal 2023 as compared with Fiscal 2022.
Revenue in mainland China, expressed as a percentage of total revenue, decreased by 23% in Fiscal 2022 as compared with Fiscal 2021 because of a decrease in revenue from completion of engineering projects in mainland China, increased by 1% in Fiscal 2023 as compared with Fiscal 2022, and increased by 2% in Fiscal 2024 as compared with Fiscal 2023.
In addition, the PRC Data Security Law provides a national security review procedure for those data activities which affect or may affect national security and imposes export restrictions on certain data and information. The PRC government promulgated the Measures for Cybersecurity Review in April 2020, which took effect in June 2020.
In addition, the PRC Data Security Law provides a national security review procedure for those data activities which affect or may affect national security and imposes export restrictions on certain data and information. 43 Table of Contents The PRC government promulgated the Measures for Cybersecurity Review in April 2020, which took effect in June 2020.
For the year ended December 31, 2022, sales to our three largest customers amounted in the aggregate to approximately 33% of our total revenue. For the year ended December 31, 2021, sales to our three largest customers amounted in the aggregate to approximately 41% of our total revenue. Seasonality Our business is affected by seasonality.
For the year ended December 31, 2023, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue. For the year ended December 31, 2022, sales to our three largest customers amounted in the aggregate to approximately 33% of our total revenue. Seasonality Our business is affected by seasonality.
If the internet-based information service provider is an entity, the domain name registrant must be the entity (or any of the entity’s shareholders), or the entity’s principal or senior manager. As of December 31, 2023, we had registered 4 domain names in mainland China.
If the internet-based information service provider is an entity, the domain name registrant must be the entity (or any of the entity’s shareholders), or the entity’s principal or senior manager. As of December 31, 2024, we had registered 6 domain names in mainland China.
We have also been cooperating with established technology companies and engage in systems and special projects in Programmable Logic Control, Telemetry unit, SCADA systems, Human Machine Interface Software and Sequential Event Recording. The Company derived approximately 37.6%, 45% and 32.2% of revenues from the sale of power solutions and process during Fiscal 2023, 2022 and 2021 respectively. Technical Support.
We have also been cooperating with established technology companies and engage in systems and special projects in Programmable Logic Control, Telemetry unit, SCADA systems, Human Machine Interface Software and Sequential Event Recording. The Company derived approximately 46.5%, 37.6%, and 45% of revenues from the sale of power solutions and process during Fiscal 2024, 2023, and 2022 respectively. Technical Support.
For the year ended December 31, 2021, sales to our three largest customers amounted in the aggregate to approximately 41% of our total revenue, with one of such customers accounting for 17% of our total revenue. 41 Table of Contents Manufacturing and Product Assembly Operations The Company has developed a handheld ballast water checker which is the first handheld rapid indicative compliance instrument made in China, based on well accepted PAM fluorescence Technology.
For the year ended December 31, 2022, sales to our three largest customers amounted in the aggregate to approximately 33% of our total revenue, with one of such customers accounting for 18% of our total revenue. 39 Table of Contents Manufacturing and Product Assembly Operations The Company has developed a handheld ballast water checker which is the first handheld rapid indicative compliance instrument made in China, based on well accepted PAM fluorescence Technology.
Ltd. 19.4% PRC Design, general contract, equipment manufacturing, installation, testing and operation management of the treatment of waste gases emitted 53 Table of Contents D. PROPERTY, PLANTS AND EQUIPMENT Since 1990, our principal executive offices have been located at Unit C and D, 18/F., Gee Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong.
Ltd. 19.4% PRC Design, manufacturing, installation, testing of waste-gas treatment equipment and operation management of the treatment of waste gases 50 Table of Contents D. PROPERTY, PLANTS AND EQUIPMENT Since 1990, our principal executive offices have been located at Unit C and D, 18/F., Gee Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong.
Any new issuance of Blue Sky’s shares on the New Third Board will dilute our ownership in Blue Sky. On the other hand, the New Third Board provides us with an exit channel to sell our position in Blue Sky if the price is attractive. In Fiscal 2023, Blue Sky made an income contribution of US$1,927,000 to the Company.
Any new issuance of Blue Sky’s shares on the New Third Board will dilute our ownership in Blue Sky. On the other hand, the New Third Board provides us with an exit channel to sell our position in Blue Sky if the price is attractive. In Fiscal 2024, Blue Sky made an income contribution of US$398,000 to the Company.
On December 6, 2007, the State Council enacted the Regulations for the Implementation of the Law on Enterprise Income Tax, which took effect on January 1, 2008 and was amended on April 23, 2019. Under the Enterprise Income Tax Law and its implementing regulations, both resident enterprises and non-resident enterprises are subject to tax in mainland China.
On December 6, 2007, the State Council enacted the Regulations for the Implementation of the Law on Enterprise Income Tax, which took effect on January 1, 2008 and was last amended on December 6, 2024. Under the Enterprise Income Tax Law and its implementing regulations, both resident enterprises and non-resident enterprises are subject to tax in mainland China.
Blue Sky’s revenue increased in Fiscal 2021 as compared to Fiscal 2020, increased in Fiscal 2022 as compared to Fiscal 2021, and decreased in Fiscal 2023 as compared to Fiscal 2022.
Blue Sky’s revenue increased in Fiscal 2022 as compared to Fiscal 2021, decreased in Fiscal 2023 as compared to Fiscal 2022, and increased in Fiscal 2024 as compared to Fiscal 2023.
During Fiscal 2023, 2022 and 2021, the Company’s gross profit margins were approximately 22%, 31% and 27%, respectively. The Company believes that it competes with the Chinese manufacturers on the basis of quality and technology.
During Fiscal 2024, 2023 and 2022, the Company’s gross profit margins were approximately 29%, 22% and 31%, respectively. The Company believes that it competes with the Chinese manufacturers on the basis of quality and technology.
As of December 31, 2023, we have registered 8 trademarks and have 6 trademarks in application in mainland China with the State Intellectual Property Office. Domain Names Domain names are protected under the Administrative Measures on Internet Domain Names promulgated by the MIIT on August 24, 2017 and effective since November 1, 2017.
As of December 31, 2024, we have registered 3 trademarks in mainland China with the State Intellectual Property Office. Domain Names Domain names are protected under the Administrative Measures on Internet Domain Names promulgated by the MIIT on August 24, 2017 and effective since November 1, 2017.
A patent is valid for twenty years in the case of an invention and ten years in the case of utility models and designs. As of December 31, 2023, we had registered 6 patents and have 6 patents in application in mainland China.
A patent is valid for twenty years in the case of an invention and ten years in the case of utility models and designs. As of December 31, 2024, we had registered 7 patents and have 1 patent application in mainland China.
The Company derived approximately 60.8%, 52.6%, and 65.9% of its revenues from the sale of scientific instruments during Fiscal 2023, 2022 and 2021 respectively. Power Solutions and Process Automation Products.
The Company derived approximately 51.6%, 60.8% and 52.6% of its revenues from the sale of scientific instruments during Fiscal 2024, 2023 and 2022 respectively. Power Solutions and Process Automation Products.
Set forth below are the approximate percentage of the Company’s revenue from customers in mainland China and Hong Kong for the fiscal years indicated: Fiscal Year Mainland China Hong Kong 2021 62 % 37 % 2022 39 % 48 % 2023 40 % 55 % Sales to customers situated in Macau and elsewhere through Fiscal 2021, Fiscal 2022 and Fiscal 2023 were 1%, 13% and 5% respectively.
Set forth below are the approximate percentage of the Company’s revenue from customers in mainland China and Hong Kong for the fiscal years indicated: Fiscal Year Mainland China Hong Kong 2022 39 % 48 % 2023 40 % 55 % 2024 42 % 44 % Sales to customers situated in Macau and elsewhere through Fiscal 2022, Fiscal 2023 and Fiscal 2024 were 13%, 5% and 14% respectively.
See – “Glossary.” Revenues from our trading activities have fallen-off as a substantial number of our suppliers have been selling their products into China directly and through other distributors. Many of these other distributors are local Chinese companies and can operate with a lower overhead.
See – “Glossary.” Revenues from our trading activities have decreased in the past few years as a substantial number of our suppliers have been selling their products into China directly and through other distributors. Many of these other distributors are local Chinese companies and can operate with a lower overhead.
For the year ended December 31, 2022, sales to our three largest customers amounted in the aggregate to approximately 33% of our total revenue, with one of such customers accounting for 18% of our total revenue.
For the year ended December 31, 2024, sales to our three largest customers amounted in the aggregate to approximately 31% of our total revenue, with one of such customers accounting for 15% of our total revenue.
Euro Tech Trading (Shanghai) Limited occupies approximately 55 square meters of office space in Shanghai pursuant to a short term lease, at a monthly rent of approximately US$322. Yixing occupies a facility in Shanghai, pursuant to a three-year lease which will expire in December 2024, at a monthly rent of approximately US$7,674.
Euro Tech Trading (Shanghai) Limited occupies approximately 55 square meters of office space in Shanghai pursuant to a short term lease, at a monthly rent of approximately US$315. Yixing occupies a facility in Shanghai pursuant to a three-year lease which will expire in December 2025, at a monthly rent of approximately US$4,302.
For example, we have already found a strategic OEM partner in Greece to exclusively distribute our products for 20 countries in Europe in 2024. Additionally, we will expand our reach to more potential growth markets worldwide, including the Middle East and Southeast Asia regions, to diversify our business risks. Product Distribution and Other Services Scientific Instruments .
So far we have one strategic OEM partner in Greece which distribute our products to 20 countries in Europe. Additionally, we will expand our reach to more potential growth markets worldwide, including the Middle East and Southeast Asia regions, to diversify our business risks. Product Distribution and Other Services Scientific Instruments .
The Company has an authorization certification from Thermo granting the Company rights to sell Thermo’s Mass Spec Products to the Government and hospitals in Hong Kong which will expire on March 31, 2025. The Company has an Authorization Letter from Stanford appointing the Company as Stanford’s sales representative in the PRC and Hong Kong.
The Company has an authorization certification (currently valid until March 31, 2026) from Thermo granting the Company rights to sell Thermo’s Mass Spec Products to the Government and hospitals in Hong Kong. The Company has an Authorization Letter from Stanford appointing the Company as Stanford’s sales representative in the PRC and Hong Kong.
In Fiscal 2021, Blue Sky made an income contribution of US$355,000 to the Company. The source of such income contribution in Fiscal 2021 was operating income. China’s 13th Five Year Plan promotes a cleaner and greener economy, with strong commitments to environmental management and protection, clean energy and emissions controls, ecological protection and security, and the development of green industries.
The source of such income contribution in Fiscal 2022 was operating income. China’s 14th Five Year Plan promotes a cleaner and greener economy, with strong commitments to environmental management and protection, clean energy and emissions controls, ecological protection and security, and the development of green industries.
If a shareholder transfers the equity interest held by it, it shall notify the company in writing to request the company (i) to change the register of shareholders and (ii) to register the change with the competent enterprise registration authority. If the company refuses or fails to respond, the transferee and transferor may file a lawsuit with the competent court.
If a shareholder transfers the equity interest held by it, it shall notify the company in writing to request the company (i) to change the register of shareholders and (ii) to register the change with the competent enterprise registration authority.
In addition, the PRC Cyber Security Law requires that critical information infrastructures operators generally shall store, within the territory of mainland China, the personal information and important data collected and produced during their operations in mainland China and their purchase of network products and services that affect or may affect national securities shall be subject to national cybersecurity review. 45 Table of Contents On June 10, 2021, the Standing Committee of the National People’s Congress promulgated the PRC Data Security Law, which became effective in September 2021.
In addition, the PRC Cyber Security Law requires that critical information infrastructures operators generally shall store, within the territory of mainland China, the personal information and important data collected and produced during their operations in mainland China and their purchase of network products and services that affect or may affect national securities shall be subject to national cybersecurity review.
In accordance with the terms of the relevant agreement, all approvals and registrations with the relevant governmental authorities were obtained, the closing of the transaction has been completed, and the Purchaser paid the purchase price to us in full in May 2018.
Jin Lijuan (the “Purchaser”), the wife of the holder of the remaining 80% equity stake of Jia Huan. In accordance with the terms of the relevant agreement, all approvals and registrations with the relevant governmental authorities were obtained, the closing of the transaction has been completed, and the Purchaser paid the purchase price to us in full in May 2018.
In addition, after the effective date of the Amended PRC Company Law, limited liability companies, joint stock limited companies with small scale or a small number of shareholders and wholly state-owned companies may set up an audit committee to replace the functions and powers of the board of supervisors, and such companies may not set the board of supervisors or any supervisor. 44 Table of Contents With respect to the transfer of equity interest of a limited liability company, the Amended PRC Company law stipulates that the shareholders of a limited liability company may transfer the equity interest without the consent of other shareholders, provided that such shareholder shall notify other shareholders in writing with respect to transfer of such equity interest.
In addition, after the effective date of the Amended PRC Company Law, limited liability companies, joint stock limited companies with small scale or a small number of shareholders and wholly state-owned companies may set up an audit committee to replace the functions and powers of the board of supervisors, and such companies may not set the board of supervisors or any supervisor.
ORGANIZATIONAL STRUCTURE Euro Tech Holdings Company Limited was incorporated in the British Virgin Islands on September 30, 1996. Far East is the principal operating subsidiary of the Company.
ORGANIZATIONAL STRUCTURE Euro Tech Holdings Company Limited was incorporated in the British Virgin Islands on September 30, 1996. Euro Tech Global, a wholly-owned subsidiary of Euro Tech Holdings Company Limited, was incorporated in Singapore in 2025, as an investment holding company. Far East is the principal operating subsidiary of the Company.
The PRC government authorities also further enhanced the supervision and regulation of cross-border data transmission. On July 7, 2022, the CAC promulgated the Measures for the Security Assessment of Cross-border Data Transfer, which took effect on September 1, 2022.
On July 7, 2022, the CAC promulgated the Measures for the Security Assessment of Cross-border Data Transfer, which took effect on September 1, 2022.
During Fiscal 2023, there was increase in revenues from trading and manufacturing activities. Revenue from Pact-Yixing in 2023 was US$5,797,000.
During Fiscal 2023, there was increase in revenues from trading and manufacturing activities. Revenue from Pact-Yixing in 2023 was US$5,797,000. In Fiscal 2023, Pact-Yixing had an operating loss of US$438,000 from engineering activities. During Fiscal 2024, there was decrease in revenues from trading and manufacturing activities. Revenue from Pact-Yixing in 2024 was US$5,834,000.
Regulations on Intellectual Property Rights Patent Patents in mainland China are principally protected under the PRC Patent Law, which was initially promulgated by the Standing Committee of the National People’s Congress in 1984 and was most recently amended in 2020.
If the company refuses or fails to respond, the transferee and transferor may file a lawsuit with the competent court. 42 Table of Contents Regulations on Intellectual Property Rights Patent Patents in mainland China are principally protected under the PRC Patent Law, which was initially promulgated by the Standing Committee of the National People’s Congress in 1984 and was most recently amended in 2020.
On February 6, 2024, the SAMR issued a draft of the Provisions of the State Council on Implementing the Registered Capital Registration and Management System under the PRC Company Law for public comments until March 5, 2024, which further specify the detailed requirements and measures of the registration and management of registered capital under the Amended PRC Company Law.
On July 1, 2024, China’s State Council issued and implemented the Provisions of the State Council on Implementing the Registered Capital Registration and Management System under the PRC Company Law, which further specify the detailed requirements and measures of the registration and management of registered capital under the Amended PRC Company Law.
The port solution system is a system installed in port to offer ballast water treatment services for ocean going ships without their own ballast water treatment system (“BWTS”) and for those with damaged BWTS.
Second, we have been developing port solution systems and have made sales of such systems to China, Southeast Asia, Middle East, etc. The port solution system is a system installed in port to offer ballast water treatment services for ocean going ships without their own ballast water treatment system (“BWTS”) and for those with damaged BWTS.
During Fiscal 2021, the Company distributed products to approximately 1,000 customers, located in Hong Kong, mainland China and Macau, such as the Hong Kong Food and Environmental Hygiene Department, Hong Kong Water Supplies Department, Government Laboratory, Drainage Services Department, and various Environmental Monitoring Centers in the PRC.
During Fiscal 2024, the Company distributed products to approximately 300 customers, located in Hong Kong, mainland China and Macau, such as Hong Kong Water Supplies Department, Government Laboratory, Drainage Services Department, universities, and public utilities agencies.
The Company has exclusivity agreements for specified geographic areas with many of its suppliers for certain products. Those agreements do not encompass all products distributed by the Company or all of the market areas serviced by the Company.
Those agreements do not encompass all products distributed by the Company or all of the market areas serviced by the Company.
Shanghai Environmental had made an operating (loss) / income of (US$110,000) in Fiscal 2020 and US$106,000 in Fiscal 2021. We also ceased the active business operations of ETTS and SET in 2021 and 2022 respectively. Before it ceases its active business operations, SET engaged in the manufacturing of analytical and testing instruments.
We also ceased the active business operations of ETTS and SET in 2021 and 2022 respectively and eventually deregistered SET in 2024. Before it ceased its active business operations, SET engaged in the manufacturing of analytical and testing instruments.
Based on the facts that, (i) the Revised Cybersecurity Review Measures were newly adopted and the discussion draft of Regulations on the Administration of Cyber Data Security have not been formally adopted, and the implementation and interpretation of both are subject to uncertainties, and (ii) we have not been involved in any investigations on cyber security review made by the CAC on such basis, nor have we received any inquiries, notices, warnings, or sanctions from any competent PRC regulatory authorities related to cybersecurity, data security and personal data protection, we believe, as of the date of this annual report, we are in compliance with the existing PRC laws and regulations on cybersecurity, data security and personal data protection issued by the CAC.
We have not been involved in any investigations on cyber security review made by the CAC on such basis, nor have we received any inquiries, notices, warnings, or sanctions from any competent PRC regulatory authorities related to cybersecurity, data security and personal data protection.
However SET incurred losses from its business during the few years prior to the cessation of its operations, therefore we made the decision to cease its active business operations. 35 Table of Contents Our principal place of business is located at Unit D, 18/F., Gee Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong, China and the telephone number is 852-28140311.
Far East holds 58% of the shares of Pact Singapore. 34 Table of Contents Our principal place of business is located at Unit D, 18/F., Gee Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong, China and the telephone number is 852-28140311.
Far East has primarily been engaged in the distribution of advanced water treatment equipment. 34 Table of Contents Yixing Pact Environmental Technology Company Limited, a Chinese company (“Yixing”) and Pact Asia Pacific Limited, a BVI company (“Pact,” collectively with “Yixing”, “Pact-Yixing”), which have engaged in the water and waste-water treatment solution business, became our majority-owned subsidiaries in 2005.
In March 1997, the Company acquired all the issued and outstanding capital stock of Far East and Far East became a wholly-owned subsidiary of the Company. 33 Table of Contents Yixing Pact Environmental Technology Company Limited, a Chinese company (“Yixing”) and Pact Asia Pacific Limited, a BVI company (“Pact,” collectively with “Yixing”, “Pact-Yixing”) became Far East’s majority-owned subsidiaries in 2005.
Sources of Supply The Company distributes products manufactured by a substantial number of major American, European and Japanese corporations, including Thermo, Stanford, Hach and Hioki, which are the Company’s largest suppliers, with purchases from them accounting for approximately 42%, 13%, 6% and 6% during Fiscal 2021; 33%, 21%, 6% and 5% during Fiscal 2022; and 42%, 23%, 7% and 5% during Fiscal 2023 respectively.
Stanford, Thermo, Hach and Hioki are the Company’s largest suppliers, with purchases from them accounting for approximately 21%, 33%, 6% and 5% during Fiscal 2022; 23%, 42%, 7% and 5% during Fiscal 2023; and 36%, 26%, 8% and 5% during Fiscal 2024, respectively. The Company has exclusivity agreements for specified geographic areas with many of its suppliers for certain products.
We previously had a 20% equity interest in Zhejiang Jia Huan Electronic Co. Ltd., a company incorporated in the PRC (“Jia Huan”), with total cost of investment US$2,486,000. Jia Huan has been engaged in the environmental protection business since 1969.
We previously had a 20% equity interest in Zhejiang Jia Huan Electronic Co. Ltd., a company incorporated in the PRC (“Jia Huan”), with total cost of investment US$2,486,000. On March 5, 2018, we entered into an Equity Transfer Agreement to sell this 20% equity stake of Jia Huan for a purchase price of RMB31,312,500 to Ms.
The PRC’s primary environmental protection agency is the Ministry of Ecology and Environment (“MEE”) which replaced the Ministry of Environmental Protection (“MEP”) after the 13th National People’s Congress was held in March 2018.The new streamlined ministry is a sign of China’s upgraded dedication to the task of improving its environment.
Environmental protection laws and strict regulations have been enacted and are buttressed by increased budget allocations for environmental regulation, monitoring and enforcement. The PRC’s primary environmental protection agency is the Ministry of Ecology and Environment (“MEE”) which replaced the Ministry of Environmental Protection (“MEP”) after the 13th National People’s Congress was held in March 2018.
In 2023, we sold a total of 35 sets of BWTS, among which 34 sets are BWTS for ship vessels that were sold in China and overseas to destinations such as Dubai, Turkey, Thailand and Singapore, and 1 set is a mobile containerized port BWTS reception facility unit for a subsidiary located in Zhangjiang, China of a renowned German chemical company. 39 Table of Contents The Company is now embarking on promotional activities for port solution systems in China and Southeast Asia to explore the growing demand, although no assurance can be given that we will be able to do so.
In Fiscal 2023, we sold 34 sets of BWTS for ship vessels to destinations including China, Dubai, Turkey, Thailand and Singapore, and sold a mobile containerized port BWTS reception facility unit to the subsidiary of a renowned German chemical company that is located in Zhangjiang, China.
In Fiscal 2023, Pact-Yixing had an operating loss of US$438,000 from engineering activities. 38 Table of Contents Principal Markets: Mainland China and Hong Kong The Company’s operations are located almost entirely within, and revenues are almost entirely generated from mainland China and Hong Kong.
We deregistered Shanghai Euro Tech Limited in 2024 and Pact ceased its active business operations in 2024. 36 Table of Contents Principal Markets: Mainland China and Hong Kong The Company’s operations are located almost entirely within, and revenues are almost entirely generated from mainland China and Hong Kong.
We continue to promote our BWTS products that currently treated ballast water at rates of 200, 300, 500, 750, 1,200 and 1,250 cubic meters per hour and port solution system. We obtained the utility model patents and are applying for the invention patents for this port solution system in China.
Moving forward, we will continue to promote our BWTS products that can treat ballast water at rates of 200, 300, 500, 750, 1,200 and 1,250 cubic meters per hour and port solution system. We also plan to enhance our after sales services for BWTS and maximize our core value in turnkey water related treatment solutions for maritime industry.
In Fiscal 2021, we sold 4 sets and 8 sets of BWTS for ports and ship vessels respectively. In Fiscal 2022, we sold 27 sets of BWTS for ship vessels, with a majority of them exported to countries other than China.
In Fiscal 2022, we did not sell any BWTS for ports, but sold 27 sets of BWTS for ship vessels, a majority of which were exported outside China.
We have participated in a number of trade shows and exhibitions to promote this product to ship owners, shipping service and equipment providers, ship builders, BWTS manufacturers, and local MSA. So far we have not received any order for this product yet, but we will continue to promote it.
We have participated in a number of trade shows and exhibitions to promote this product, but have not received any order yet. Sources of Supply The Company distributes products manufactured by some major American, European and Japanese corporations.
However, no assurance can be given that these efforts will be successful. We also plan to participate more overseas maritime /water tradeshows in 2023 to capture more potential sales distributors located overseas. In addition, we intend to continue to assemble and/or manufacture additional products, and seek opportunities with our suppliers to assemble their products.
We also plan to continue to assemble and/or manufacture additional products, and seek opportunities with our suppliers to assemble their products.
Details of the Company’s current principal subsidiaries are summarized as follows: Name of entity Ownership interest held by the Group Place of incorporation and principal place of operation Principal activities Subsidiaries: Euro Tech (Far East) Limited 100% Hong Kong Marketing and trading of water and waste water related process control, analytical and testing instruments, disinfection equipment, supplies and related automation systems Euro Tech Trading (Shanghai) Limited 100% PRC Inactive Shanghai Euro Tech Limited 100% PRC Inactive Yixing Pact Environmental Technology Co., Ltd 58% PRC Design, manufacturing and operation of water and wastewater treatment and water desalination machinery and equipment Pact Asia Pacific Limited 58% British Virgin Islands Selling of environmental protection equipment, undertaking environment protection projects and providing relevant technology advice, training and services Affiliate: Zhejiang Tianlan Environmental Protection Technology Co.
LTD 58% Singapore Marketing and provision of after sales services of ballast water treatment systems and customized industrial wastewater solutions, equipment fabrication Yixing Pact Environmental Technology Co., Ltd 58% PRC Design, manufacturing and operation of water and wastewater treatment and water desalination machinery and equipment Pact Asia Pacific Limited 58% British Virgin Islands Inactive Affiliate: Zhejiang Tianlan Environmental Protection Technology Co.
Removed
In March 1997, the Company acquired all the issued and outstanding capital stock of Far East. Since then, Far East has been a wholly-owned subsidiary and the primary operational entity of the Company.
Added
However SET incurred losses from its business during the few years prior to the cessation of its operations, therefore we made the decision to cease its active business operations. We incorporated Euro Tech Global as a wholly-owned subsidiary in 2025. Euro Tech Global holds 100% of the shares of Far East. We also incorporated Pact Singapore in 2024.
Removed
On March 5, 2018, we entered into an Equity Transfer Agreement to sell this 20% equity stake of Jia Huan for a purchase price of RMB31,312,500 to Ms. Jin Lijuan (the “Purchaser”), the wife of the holder of the remaining 80% equity stake of Jia Huan.
Added
In Fiscal 2024, Pact-Yixing had an operating income of US$273,000 from engineering activities.
Removed
Revenue in Hong Kong, expressed as a percentage of our revenue, decreased by 23% in Fiscal 2021 as compared with Fiscal 2020 as a result of significant increase in revenue in mainland China.
Added
We have obtained 5 utility model patents and are applying for 1 invention patent for this port solution system in China. We continue to invest a portion of our resources to developing our BWTS for the global market. We have also embarked on promotional activities for port solution systems globally to explore the growing demand.
Removed
Revenue in mainland China, expressed as a percentage of total revenue, increased by 24% in Fiscal 2021 as compared with Fiscal 2020. The increase was primarily due to the significant increase in revenue for completion of engineering projects in mainland China.
Added
For example, in 2024, we participated in four maritime tradeshows held in Singapore, Indonesia, Germany, and Turkey respectively, to promote our BWTS. In Fiscal 2020, we sold one set of BWTS for ports and one set of BWTS for ship vessels. In Fiscal 2021, we sold 4 sets BWTS for ports and 8 sets of BWTS for ship vessels.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

40 edited+10 added−7 removed71 unchanged
Net cash (used in) financing activities Net cash used in financing activities for the year ended December 31, 2023 was US$82,000, as a result of proceeds from bank borrowings related to trade finance purchases of US$666,000, and purchase of treasury stock of US$14,000 and repayments of US$734,000 to bank borrowings.
Net cash used in financing activities for the year ended December 31, 2023 was US$82,000, as a result of proceeds from bank borrowings related to trade finance purchases of US$666,000, and purchase of treasury stock of US$14,000 and repayments of US$734,000 to bank borrowings.
Furthermore, certain companies, such as companies in the LNG (i.e., liquefied natural gas) industry, would make use of pure or demineralized water as produced water for their internal production process. 59 Table of Contents As more environmental regulations are being promulgated and enforced, and as ESG goals take more prominence, we anticipate customers would have increasing awareness of the importance of legal compliance and taking care of our environment as being a responsible steward.
Furthermore, certain companies, such as companies in the LNG (i.e., liquefied natural gas) industry, would make use of pure or demineralized water as produced water for their internal production process. 56 Table of Contents As more environmental regulations are being promulgated and enforced, and as ESG goals take more prominence, we anticipate customers would have increasing awareness of the importance of legal compliance and taking care of our environment as being a responsible steward.
Other than as disclosed in the foregoing disclosures and elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the fiscal year 2023 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
Other than as disclosed in the foregoing disclosures and elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the fiscal year 2024 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
Contract assets and contract liabilities arising from the same individual contract are presented net as either a single net contract asset or single net contract liability for presentation purposes. 61 Table of Contents Investments in Affiliates We account for our interest in an investment using the equity method of accounting per Accounting Standards Codification (“ASC”) No. 323, “Investments - Equity Method and Joint Ventures” if we are not the primary beneficiary of a VIE or do not have a controlling interest.
Contract assets and contract liabilities arising from the same individual contract are presented net as either a single net contract asset or single net contract liability for presentation purposes. 58 Table of Contents Investments in Affiliates We account for our interest in an investment using the equity method of accounting per Accounting Standards Codification (“ASC”) No. 323, “Investments - Equity Method and Joint Ventures” if we are not the primary beneficiary of a VIE or do not have a controlling interest.
The Company evaluates the progress towards completion of the performance obligation at each phase of the contract and bills the customer in accordance with the price agreed upon on the contract. 60 Table of Contents Remaining performance obligations (“RPOs”) RPOs represent the amount of revenues we expect to recognize in the future from our contract commitments on projects and are hereafter referred to as “Backlog”.
The Company evaluates the progress towards completion of the performance obligation at each phase of the contract and bills the customer in accordance with the price agreed upon on the contract. 57 Table of Contents Remaining performance obligations (“RPOs”) RPOs represent the amount of revenues we expect to recognize in the future from our contract commitments on projects and are hereafter referred to as “Backlog”.
On January 1, 2024, the Chinese legislature promulgated Amendment to the Marine Environmental Protection Law, pursuant to which China is strengthening the supervision and management of marine environment pollution from ships in the port area. See “Item 4. Information on the Company — B. Business Overview – Regulatory Environment”.
On January 1, 2024, the Chinese legislature implemented the Amendment to the Marine Environmental Protection Law, pursuant to which China is strengthening the supervision and management of marine environment pollution from ships in the port area. See “Item 4. Information on the Company — B. Business Overview – Regulatory Environment”.
The Company had various banking facilities available for overdraft, import and export credits and foreign exchange contracts from which the Company could have accessed up to US$897,000 as of December 31, 2023.
The Company had various banking facilities available for overdraft, import and export credits and foreign exchange contracts from which the Company could have accessed up to US$897,000 as of December 31, 2024.
The Group also evaluates whether the recorded deferred tax assets and valuation allowances can be realized and, when necessary, reduces the amounts to what is expected to be realized. 62 Table of Contents
The Group also evaluates whether the recorded deferred tax assets and valuation allowances can be realized and, when necessary, reduces the amounts to what is expected to be realized. 59 Table of Contents
Capital expenditure The Company’s capital expenditures were US$5,000, US$7,000 and US$4,000 in Fiscal 2023, 2022 and Fiscal 2021, respectively. Capital expenditures during Fiscal 2023, Fiscal 2022 and Fiscal 2021 were incurred primarily in connection with the purchase of office equipment, and furniture and fixtures. The Company continues to develop new products.
Capital expenditure The Company’s capital expenditures were US$5,000, US$5,000, and US$7,000 in Fiscal 2024, Fiscal 2023, and Fiscal 2022, respectively. Capital expenditures during Fiscal 2024, Fiscal 2023, and Fiscal 2022 were incurred primarily in connection with the purchase of office equipment, and furniture and fixtures. The Company continues to develop new products.
Goodwill Annual impairment assessment - For our 2023 annual impairment test we performed a qualitative assessment, using information as of December 31, 2023.
Goodwill Annual impairment assessment - For our 2024 annual impairment test we performed a qualitative assessment, using information as of December 31, 2024.
During the year ended December 31, 2022, the Company paid US$7,000 to acquire property, plant and equipment and received dividend of US$239,000 from affiliates.
During the year ended December 31, 2023, the Company paid US$5,000 to acquire property, plant and equipment and received dividend of US$322,000 from affiliates. During the year ended December 31, 2022, the Company paid US$7,000 to acquire property, plant and equipment and received dividend of US$239,000 from affiliates.
Tax expense of US$45,000 in Fiscal 2023 as compared to US$24,000 in Fiscal 2022. The change in tax expense was principally due to increase in assessable profits. Net Income. Profit from continuing operations was profit of US$1,828,000 in Fiscal 2023 as compared to US$369,000 in Fiscal 2022. This change was primarily due to increase in equity in income of affiliates.
Tax expense of US$45,000 in Fiscal 2023 as compared to US$24,000 in Fiscal 2022. The change in tax expense was principally due to increase in assessable profits. Net Income. Profit from continuing operations was profit of US$1,828,000 in Fiscal 2023 as compared to US$369,000 in Fiscal 2022.
In contract, our BWTS business has thrived both in China and internationally during fiscal year 2023. We believe this growth is mainly driven by the increasing demand in the maritime industry, spurred by IMO policy and local environmental regulations related to Environmental Impact Assessment.
In contrast, our BWTS business has thrived both in China and internationally in fiscal 2023 and 2024. We believe this growth is mainly driven by the increasing demand in the maritime industry, spurred by IMO policy and local environmental regulations related to Environmental Impact Assessment.
The amount of accounts receivable, net subject to collection is expected to be received under normal commercial trading terms. The Company’s inventories increased from US$547,000 at the end of Fiscal 2021 to US$603,000 at the end of Fiscal 2022, and increased to US$723,000 at the end of Fiscal 2023.
The amount of accounts receivable, net subject to collection is expected to be received under normal commercial trading terms. The Company’s inventories increased from US$603,000 at the end of Fiscal 2022 to US$723,000 at the end of Fiscal 2023, and decreased to US$500,000 at the end of Fiscal 2024.
In Fiscal 2022, our revenue decreased significantly due to the decrease in sales orders from China, our major market, as the Chinese government has imposed lock down policies in response to the outbreak of COVID-19.
Our revenue decreased significantly in Fiscal 2022 due to the decrease in sales orders from China, our major market, due to lock down policies implemented by the Chinese government in response to the outbreak of COVID-19.
Net cash provided by investing activities for the year ended December 31, 2022 was US$232,000. Net cash provided by investing activities for the year ended December 31, 2021 was US$358,000. During the year ended December 31, 2023, the Company paid US$5,000 to acquire property, plant and equipment and received dividend of US$322,000 from affiliates.
Net cash provided by investing activities for the year ended December 31, 2022 was US$232,000. During the year ended December 31, 2024, the Company paid US$5,000 to acquire property, plant and equipment and received dividend of US$307,000 from affiliates.
Under output method, revenue recognition is based on the stage of completion of the contracts, provided that the stage of contract completion and the gross billing value of contracting work can be measured reliably. The stage of completion of a contract is established by reference to the stages of works certified by customers.
Under output method, revenue recognition is based on the stage of completion of the contracts, provided that the stage of contract completion and the gross billing value of contracting work can be measured reliably. The stage of completion of a contract is established by reference to the contract based on billing milestone or stage of work certified by customer.
Working capital at the end of Fiscal 2023, Fiscal 2022 and Fiscal 2021 were US$4,949,000, US$4,980,000 and US$5,099,000, respectively. As of December 31, 2023, we had US$5,453,000 in cash and cash equivalents, compared to US$5,628,000 in cash and cash equivalents as of December 31, 2022 and US$5,269,000 in cash and cash equivalents as of December 31, 2021.
Working capital at the end of Fiscal 2024, Fiscal 2023, and Fiscal 2022 were US$5,224,000, US$4,949,000, and US$4,980,000, respectively. As of December 31, 2024, we had US$5,805,000 in cash and cash equivalents, compared to US$5,453,000 in cash and cash equivalents as of December 31, 2023 and US$5,628,000 in cash and cash equivalents as of December 31, 2022.
If the carrying value of goodwill exceeds its implied fair value, an impairment charge would be recorded in the statement of operations and comprehensive income / (loss). Accounts receivable and allowance for doubtful accounts The Group does not charge interest to its customers and carries its customer receivables at their face amounts, less an allowance for doubtful accounts.
If the carrying value of goodwill exceeds its implied fair value, an impairment charge would be recorded in the statement of operations and comprehensive income / (loss). Accounts receivable, net The Group does not charge interest to its customers and carries its customer receivables at their face amounts, net of expected credit losses.
The following table presents selected statement of operations data expressed in thousands of US$ and as a percentage of revenue for the Company’s fiscal years indicated below: 2023 2022 2021 2020 2019 Revenue $ 17,940 100 % $ 14,949 100 % $ 21,388 100 % $ 13,357 100 % $ 17,399 100 % Cost of revenue $ 14,079 78.5 % $ 10,331 69.1 $ 15,693 73.4 % $ 9,672 72.4 % $ 12,982 74.6 % Gross profit $ 3,861 21.5 % $ 4,618 30.9 % $ 5,695 26.6 % $ 3,685 27.6 % $ 4,417 25.4 % Selling and administrative expenses $ 4,103 22.9 % $ 4,490 30.0 % $ 4,911 23.0 % $ 5,374 40.2 % $ 4,853 27.9 % (Loss) gain on disposal of property, plant and equipment $ - - $ (7 ) - $ (10 ) - % $ 1,429 10.7 $ (5 ) - (Loss) / income before income taxes, equity in income / (loss) of affiliates and non-controlling interests $ (232 ) -1.3 % $ 150 1.0 % $ 921 4.3 % $ 63 0.5 % $ (310 ) -1.8 % Income tax (expense) credit $ (45 ) -0.3 % $ (24 ) -0.2 % $ 90 0.4 % $ (96 ) -0.7 % $ (37 -0.2 % Equity in income / (loss) of affiliates $ 1,927 10.7 % $ 413 2.8 % $ 355 1.7 % $ 435 3.3 % $ 137 0.8 % Net income / (loss) $ 1,650 9.2 % $ 539 3.6 % $ 1,366 6.4 % $ 402 3.0 % $ (210 ) -1.2 % Net loss / (income) attributable to non-controlling interests $ 178 1.0 % $ (170 ) -1.1 % $ (377 ) -1.8 % $ 367 2.7 % $ 64 0.4 % Net income / (loss) attributable to Euro Tech Holding Company Limited’s shareholders $ 1,828 10.2 % $ 369 2.5 % $ 989 4.6 % $ 769 5.7 % $ (146 ) -0.8 % 55 Table of Contents Fiscal Year Ended December 31, 2023 Compared to Fiscal Year Ended December 31, 2022 Revenue; Gross Profit and Cost of Revenue.
The following table presents selected statement of operations data expressed in thousands of US$ and as a percentage of revenue for the Company’s fiscal years indicated below: 2024 2023 2022 2021 2020 Revenue $ 15,383 100 % $ 17,940 100 % $ 14,949 100 % $ 21,388 100 % $ 13,357 100 % Cost of revenue $ 10,929 71.0 % $ 14,079 78.5 % $ 10,331 69.1 $ 15,693 73.4 % $ 9,672 72.4 % Gross profit $ 4,454 29.0 % $ 3,861 21.5 % $ 4,618 30.9 % $ 5,695 26.6 % $ 3,685 27.6 % Selling and administrative expenses $ 4,067 26.4 % $ 4,103 22.9 % $ 4,490 30.0 % $ 4,911 23.0 % $ 5,374 40.2 % (Loss) gain on disposal of property, plant and equipment $ - - % $ - - $ (7 ) - $ (10 ) - % $ 1,429 10.7 Income / (loss) before income taxes, equity in income / (loss) of affiliates and non-controlling interests $ 519 3.4 % $ (232 ) -1.3 % $ 150 1.0 % $ 921 4.3 % $ 63 0.5 % Income tax (expense) credit $ (72 ) -0.5 % $ (45 ) -0.3 % $ (24 ) -0.2 % $ 90 0.4 % $ (96 ) -0.7 % Equity in income / (loss) of affiliates $ 398 2.6 % $ 1,927 10.7 % $ 413 2.8 % $ 355 1.7 % $ 435 3.3 % Net income $ 845 5.5 % $ 1,650 9.2 % $ 539 3.6 % $ 1,366 6.4 % $ 402 3.0 % Net (income) / (loss) attributable to non-controlling interests $ (111 ) 0.7 % $ 178 1.0 % $ (170 ) -1.1 % $ (377 ) -1.8 % $ 367 2.7 % Net income attributable to Euro Tech Holding Company Limited’s shareholders $ 734 4.8 % $ 1,828 10.2 % $ 369 2.5 % $ 989 4.6 % $ 769 5.7 % 52 Table of Contents Fiscal Year Ended December 31, 202 4 Compared to Fiscal Year Ended December 31, 202 3 Revenue; Gross Profit and Cost of Revenue.
We conduct our operations in Hong Kong and China mainly through our subsidiaries and operating companies. Under our current corporate structure, our BVI holding company may rely on dividend payments from Far East, which is a wholly owned enterprise incorporated in Hong Kong, to fund any cash and financing requirements we may have.
Under our current corporate structure, our BVI holding company may rely on dividend payments from Far East, which is a wholly owned enterprise incorporated in Hong Kong, to fund any cash and financing requirements we may have.
For the engineering segment, the Company, through its majority owned subsidiary, Pact-Yixing and its minority owned affiliate, Blue Sky, also engages in water and waste-water treatment engineering and air pollution control business. Our total revenue decreased by 30.1% to US$14,949,000 in fiscal year 2022 and increased by 20.0% to US$17,940,000 in fiscal year 2023.
For the engineering segment, the Company, through its majority owned subsidiary, Yixing, and its minority owned affiliate, Blue Sky, engages in water and waste-water treatment engineering and air pollution control business. Our total revenue increased by 20.0% to US$17,940,000 in fiscal year 2023 and decreased by 14.3% to US$15,383,000 in fiscal year 2024.
Net cash (used in )/ provided by operating activities Net cash used in operating activities was US$80,000 for the year ended December 31, 2023. Net cash provided by operating activities was US$461,000 for the year ended December 31, 2022. Net cash provided by operating activities US$2,201,000 for the year ended December 31, 2021.
Net cash provided by / (used in ) operating activities Net cash provided in operating activities was US$781,000 for the year ended December 31, 2024. Net cash used in operating activities was US$80,000 for the year ended December 31, 2023. Net cash provided by operating activities was US$461,000 for the year ended December 31, 2022.
For the fiscal years of 2021, 2022 and 2023, no dividends were distributed from our PRC subsidiaries to Far East. 58 Table of Contents Unless otherwise specified in this annual report, within the organization, cash to fund our operations is transferred from Far East, our BVI holding company, down through Far East to our operating subsidiaries in China.
For the fiscal years of 2022, 2023 and 2024, no dividends were distributed from our PRC subsidiaries to Far East. 55 Table of Contents Unless otherwise specified in this annual report, within the organization, cash to fund our operations is transferred from our BVI holding company to Far East Euro Tech Global, and then our operating subsidiaries in China.
Cash decreased to US$5,453,000 at the end of Fiscal 2023, and the principal reason for the decrease in cash was an increase in cash collaterals for bank guarantees obtained in the ordinary course of our business for the benefit of our customers to guarantee the Company’s payment obligations or the performance of other obligations to such customers. 57 Table of Contents The Company’s accounts receivable, net decreased from US$3,631,000 at the end of Fiscal 2021 to US$1,586,000 at the end of Fiscal 2022, and increased to US$2,864,000 at the end of Fiscal 2023.
Cash decreased from US$5,628,000 at the end of Fiscal 2022 to US$5,453,000 at the end of Fiscal 2023, and the principal reason for the decrease in cash was an increase in cash collaterals for bank guarantees obtained in the ordinary course of our business for the benefit of our customers to guarantee the Company’s payment obligations or the performance of other obligations to such customers.
Contractual Obligations The future undiscounted minimum lease payments, as reconciled to the discounted minimum lease obligation indicated on the Group’s consolidated balance sheets, under current portion of operating lease obligations and operating lease obligations, net of current maturities, as of December 31, 2023 were as follows: Payment due by December 31, (in US$ thousands) Total 2024 2025 2026 2027 and after Operating lease commitments 214 170 44 - - Total 214 170 44 - - C.
Contractual Obligations The future undiscounted minimum lease payments, as reconciled to the discounted minimum lease obligation indicated on the Group’s consolidated balance sheets, under current portion of operating lease obligations and operating lease obligations, net of current maturities, as of December 31, 2024 were as follows: Payment due by December 31, (in US$ thousands) Total 202 5 202 6 202 7 202 8 and after Operating lease commitments 92 83 9 - - Total 92 83 9 - - C.
This change was primarily due to decrease in sales orders and revenue as affected by COVID-19. 56 Table of Contents B. LIQUIDITY AND CAPITAL RESOURCES The Company has primarily used its own funds to finance accounts receivable, net, contract assets, inventories, and capital expenditures including purchases of property, office furniture and equipment, computers and calibration equipment.
This change was primarily due to increase in equity in income of affiliates. 53 Table of Contents B. LIQUIDITY AND CAPITAL RESOURCES The Company has primarily used its own funds to finance accounts receivable, net, contract assets, inventories, and capital expenditures including purchases of property, office furniture and equipment, computers and calibration equipment.
Our net income decreased by 62.6% to US$369,000 in fiscal year 2022 and increased by 395.3% to US$1,828,000 in fiscal year 2023. 54 Table of Contents The impact of COVID-19 pandemic.
Our net income increased by 395.36% to US$1,828,000 in fiscal year 2023 and decreased by 59.8% to US$734,000 in fiscal year 2024. 51 Table of Contents The impact of COVID-19 pandemic.
The Company expects, but can make no assurances that its present cash reserves, cash from operations and existing available bank credit facilities would be sufficient to fund its future cash requirements. Inflation The Company believes generally that past declining rates of inflation in the PRC have had a positive effect on its results from operations.
The Company expects, but can make no assurances that its present cash reserves, cash from operations and existing available bank credit facilities would be sufficient to fund its future cash requirements.
Tax expense of US$24,000 in Fiscal 2022 as compared to tax credit of US$90,000 in Fiscal 2021. The change in tax expense was principally due to the increase in assessable profit. Net Income. Profit from continuing operations was profit of US$369,000 in Fiscal 2022 as compared to US$989,000 in Fiscal 2021.
Tax expense of US$72,000 in Fiscal 2024 as compared to US$45,000 in Fiscal 2023. The change in tax expense was principally due to increase in assessable profits. Net Income. Profit from continuing operations was profit of US$734,000 in Fiscal 2024 as compared to US$1,828,000 in Fiscal 2023.
Many of the customers and potential customers of our wastewater treatment systems are the Chinese subsidiaries of foreign companies, and some of them have delayed or suspended their business operations due to the impact of COVID-19, some have even relocated their operations outside China, consequently our wastewater treatment business has experienced a contraction during fiscal year 2023.
In Fiscal 2023 and 2024, while our business may not have been directly affected by COVID-19, our wastewater treatment operations may have been materially and adversely affected by COVID-19 indirectly, because many customers and potential customers of our wastewater treatment systems are the Chinese subsidiaries of foreign companies, and some of them have delayed or suspended their business operations or even relocated their operations outside China in connection with the outbreak of COVID-19.
RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC. During Fiscal 2023, 2022 and 2021, the Company incurred cost of nil, nil and US$61,000 respectively, on the research and development of its products, particularly BWTS. D.
RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC. The Company did not incur any cost of research and development on its products in Fiscal 2022, 2023 and 2024. D.
Management continually evaluates all of its estimates and judgments based on available information and experience; however, actual results could differ from these estimates. Revenue Recognition Our revenue is derived from both short and long-term contracts for customers in our engineering segment, as well as short-term contracts for customers in our trading and manufacturing segment.
Management continually evaluates all of its estimates and judgments based on available information and experience; however, actual results could differ from these estimates. Revenue Recognition The Company follows the revenue standard Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers.
Interest income in Fiscal 2022 was US$23,000 as compared to US$23,000 in Fiscal 2021. Other income / (losses). Other income decreased by US$114,000 to US$13,000 in Fiscal 2022 from US$127,000 in Fiscal 2021. The decrease in other income was principally due to exchange loss incurred. Income Taxes.
Interest income in Fiscal 2024 was US$96,000 as compared to US$37,000 in Fiscal 2023. Other income / (losses). Other income was US$37,000 in Fiscal 2024 as compared to other losses of US$20,000 in Fiscal 2023. The change was principally because of exchange loss in Fiscal 2023. Income Taxes.
During Fiscal 2022, the Company’s cost of revenues was US$10,331,000 or 69.1% of revenues, in comparison to US$15,693,000 or 73.4% for Fiscal 2021. Cost of revenue expressed as a percentage of revenue decreased by 4.3% in Fiscal 2022 as compared with Fiscal 2021. Cost of revenues from trading and manufacturing activities increased by US$407,000 and engineering activities decreased by US$5,769,000.
Cost of revenue expressed as a percentage of revenue decreased by 7.5% in Fiscal 2024 as compared with Fiscal 2023. Cost of revenues from trading and manufacturing activities decreased by US$2,451,000 and engineering activities decreased by US$699,000.
Cash increased from US$5,269,000 at the end of Fiscal 2021 to US$5,628,000 at the end of Fiscal 2022, and the principal reason for the increase in cash was net cash provided by operating activities.
Cash decreased to US$5,805,000 at the end of Fiscal 2024, and the principal reason for the decrease in cash was dividend paid. 54 Table of Contents The Company’s accounts receivable, net increased from US$1,586,000 at the end of Fiscal 2022 to US$2,864,000 at the end of Fiscal 2023, and decreased to US$1,386,000 at the end of Fiscal 2024.
The overall change was principally due to decrease in revenue. Pact-Yixing contributed US$2,631,000 to our gross profit in Fiscal 2022, a decrease of US$272,000 from Fiscal 2021. Selling and Administrative Expenses . Selling and administrative expenses were US$4,490,000 in Fiscal 2022, a decrease of US$421,000 or 8.6% from US$4,911,000 in Fiscal 2021.
The overall change was principally due to decrease in sales of high value analytical instruments of lower gross profit % and increase in revenue of BWTS of higher gross profit margin. Pact-Yixing contributed US$2,205,000 to our gross profit in Fiscal 2024, an increase of US$736,000 from Fiscal 2023.
Net cash used in operating activities for the year ended December 31, 2023 was primarily the result of the net income of US$1,828,000, an increase in accounts receivable of US$1,278,000,increase in inventories of US$120,000, and decrease in other payables and accrued expenses of US$107,000.
Net cash provided by operating activities for the year ended December 31, 2024 was primarily the result of the net income of US$734,000, a decrease in accounts receivable of US$1,478,000, decrease in inventories of US$223,000, non-controlling interests in income of subsidiaries of US$111,000, equity in profit of affiliates of US$398,000 and decrease in amortization on right-of-use assets of US$132,000.
The decrease was principally due to decrease in expenses related to sales and control over overheads. Equity in Income of Affiliates. Equity in income of affiliates was income of US$413,000 in Fiscal 2022, an increase of US$58,000 from income of affiliates of US$355,000 in Fiscal 2021. Interest Income.
The increase was principally due to increase in revenue from BWTS with higher gross profit margin. Selling and Administrative Expenses . Selling and administrative expenses were US$4,067,000 in Fiscal 2024, a slight decrease of US$36,000 or 0.9% from US$4,103,000 in Fiscal 2023. Equity in Income of Affiliates.
Non-cash adjustments consisting of depreciation of property, plant and equipment of US$15,000, stock-based compensation expense of US$47,000, Non-controlling interests in (loss) of subsidiaries of US$178,000, equity in profit of affiliates of US$1,927,000 and deferred tax expense of US$5,000. Net cash provided by investing activities Net cash provided by investing activities for the year ended December 31, 2023 was US$317,000.
These amounts were partially offset by the decrease in accounts payables of US$1,177,000. Net cash provided by investing activities Net cash provided by investing activities for the year ended December 31, 2024 was US$302,000. Net cash provided by investing activities for the year ended December 31, 2023 was US$317,000.
Removed
Our business has been adversely impacted by the outbreak of COVID-19, especially during the first quarter of year 2020, and during the period starting from February to December of 2022.
Added
Revenue decreased by US$2,557,000 or 14.3% to US$15,383,000 in Fiscal 2024 from US$17,940,000 in Fiscal 2023. Revenue from trading and manufacturing activities and engineering activities decreased by US$2,994,000 and increased by US$37,000, respectively. Decrease in revenue from trading activities was mainly a result of substantial drop in sales of high value analytical instruments to Hong Kong Government.
Removed
Since January 2023, we have seen a gradual recovery of our overall business resulting from the lifting by the Chinese government of various measures in response to the pandemic. Although we believe our business may not have been directly affected by COVID-19 in 2023, our wastewater treatment operations may have been materially adversely affected by COVID-19.
Added
Gross profit increased by US$593,000 or 15.4% to US$4,454,000 for Fiscal 2024 as compared to US$3,861,000 for Fiscal 2023. During Fiscal 2024, the Company’s cost of revenues was US$10,929,000 or 71.0% of revenues, in comparison to US$14,079,000 or 78.5% for Fiscal 2023.
Removed
Fiscal Year Ended December 31, 2022 Compared to Fiscal Year Ended December 31, 2021 Revenue; Gross Profit and Cost of Revenue. Revenue decreased by US$6,439,000 or 30.1% to US$14,949,000 in Fiscal 2022 from US$21,388,000 in Fiscal 2021. Revenue from trading and manufacturing activities and engineering activities decreased by US$287,000 and US$6,152,000, respectively.
Added
Equity in income of affiliates was US$398,000 in Fiscal 2024, an decrease of US$1,529,000 from equity in income of affiliates of US$1,927,000 in Fiscal 2023. The decrease was primarily because there was non-recurrent income from the disposal of 2 desulfurization treatment plants for a “Build-operate-transfer” project located in Shanxi, China. Interest Income.
Removed
Pact-Yixing’s revenues of US$5,617,000 and US$12,161,000 were included in our revenues in Fiscal 2022 and Fiscal 2021, respectively and the decrease was principally due to adverse impacts of the COVID-19 pandemic and Shanghai’s lockdown in 2022. Gross profit decreased by US$1,077,000 or 18.9% to US$4,618,000 for Fiscal 2022 as compared to US$5,695,000 for Fiscal 2021.
Added
This change was primarily due to there was an exceptional increase in equity in income of affiliates in Fiscal 2023 arising from non-recurrent income of disposal of 2 desulfurization treatment plants. Fiscal Year Ended December 31, 2023 Compared to Fiscal Year Ended December 31, 2022 Revenue; Gross Profit and Cost of Revenue.
Removed
These amounts were partially offset by the decrease in prepayments, and other assets of US$240,000, decrease in contract assets of US$151,000, increase in accounts payables of US$1,177,000, increase in contract liabilities of US$25,000, increase in income tax payable of US$42,000 and increase in right-of-use assets and operating lease liabilities of US$57,000.
Added
Net cash (used in) financing activities Net cash used in financing activities for the year ended December 31, 2024 was US$778,000, as a result of and dividend payment of US$617,000, and purchase of treasury stock of US$7,000 and repayments of US$154,000 to bank borrowings.
Removed
As a result of the recent rise in the rate of inflation in the PRC, we anticipate increases in the overhead costs of our PRC affiliates and offices.
Added
Inflation The Company cannot determine the precise effect of inflation on its operations; however, it does not believe inflation has had a material effect on revenues or results of operations during the past several years. We can provide no assurance that we will not be affected by higher rates of inflation in the future.
Removed
The Company believes, although no assurance can be given, that as credit restrictions are gradually lifted, it will be able to increase prices in the market for its products and thus realize increased profit margins. Holding Company Structure Euro Tech Holdings Company Limited is a holding company with no operations of its own.
Added
Holding Company Structure Euro Tech Holdings Company Limited is a holding company with no operations of its own. We conduct our operations in Hong Kong and China mainly through our subsidiaries and operating companies.
Added
The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services.
Added
The following five steps are applied to achieve that core principle: Step 1: Identify the contract with the customer; Step 2: Identify the performance obligations in the contract; Step 3: Determine the transaction price; Step 4: Allocate the transaction price to the performance obligations in the contract; Step 5: Recognize revenue when the company satisfies a performance obligation.
Added
Our revenue is derived from both short and long-term contracts for customers in our engineering segment, as well as short-term contracts for customers in our trading and manufacturing segment.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

31 edited+7 added−6 removed41 unchanged
Leung’s responsibility as the General Manager of Yixing includes management of engineering, sales, marketing, projects, and procurement. Before joining Yixing, Mr. Leung was the Business Development Manager of Euro Tech (Far East) Limited, the parent company of Yixing Pact in Hong Kong, and has been working for the parent company for more than 10 years. Mr.
Mr. Leung’s responsibility as the General Manager of Yixing includes management of engineering, sales, marketing, projects, and procurement. Before joining Yixing, Mr. Leung was the Business Development Manager of Euro Tech (Far East) Limited, the parent company of Yixing Pact in Hong Kong, and has been working for the parent company for more than 10 years. Mr.
The Company indemnifies the members of any Committee and its delegates and the Chief Executive Officer against (a) the reasonable expenses (as such expenses are incurred), including attorneys’ fees actually and necessarily incurred in connection with the defense of any action, suit or proceeding (or in connection with any appeal therein), to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan, or any option granted under the Plan; and (b) all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such Committee member or delegatee, as applicable, is liable for gross negligence or gross misconduct in the performance of his or her duties; provided that within 60 days after institution of any such action, suit or proceeding a Committee member or delegatee shall in writing offer the Company the opportunity, at its own expense, to handle and defend the same. 66 Table of Contents The Board may terminate, suspend, or amend the Plan at any time without the authorization of shareholders to the extent allowed by law or the rules of any market on which the Company’s shares are then listed or quoted.
The Company indemnifies the members of any Committee and its delegates and the Chief Executive Officer against (a) the reasonable expenses (as such expenses are incurred), including attorneys’ fees actually and necessarily incurred in connection with the defense of any action, suit or proceeding (or in connection with any appeal therein), to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan, or any option granted under the Plan; and (b) all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such Committee member or delegatee, as applicable, is liable for gross negligence or gross misconduct in the performance of his or her duties; provided that within 60 days after institution of any such action, suit or proceeding a Committee member or delegatee shall in writing offer the Company the opportunity, at its own expense, to handle and defend the same. 63 Table of Contents The Board may terminate, suspend, or amend the Plan at any time without the authorization of shareholders to the extent allowed by law or the rules of any market on which the Company’s shares are then listed or quoted.
Appropriate adjustment in the maximum number of ordinary shares issuable pursuant to this Plan, the maximum number of ordinary shares with respect to which options may be granted within any 12-month period to any participant during the duration of this Plan, the number of shares subject to options granted under this Plan, and the exercise price with respect to options, shall be made to give effect to any increase or decrease in the number of issued ordinary shares resulting from a subdivision or consolidation of shares whether through reorganization, recapitalization, division of shares, reverse share split, spin-off, split-off, spin-out, or other distribution of assets to shareholders, issue of bonus shares or combination of shares, assumption and conversion of outstanding options due to an acquisition by the Company of the shares, stock or assets of any other company or corporation, other increase or decrease in the number of such shares outstanding effected, without receipt of consideration by the Company, or any other occurrence for which the Committee determines an adjustment is appropriate. 65 Table of Contents The purchase price per share of the ordinary shares to be paid upon the exercise of the option must be at least 100% of the fair market value of an ordinary shares on the date on which the option was granted.
Appropriate adjustment in the maximum number of ordinary shares issuable pursuant to this Plan, the maximum number of ordinary shares with respect to which options may be granted within any 12-month period to any participant during the duration of this Plan, the number of shares subject to options granted under this Plan, and the exercise price with respect to options, shall be made to give effect to any increase or decrease in the number of issued ordinary shares resulting from a subdivision or consolidation of shares whether through reorganization, recapitalization, division of shares, reverse share split, spin-off, split-off, spin-out, or other distribution of assets to shareholders, issue of bonus shares or combination of shares, assumption and conversion of outstanding options due to an acquisition by the Company of the shares, stock or assets of any other company or corporation, other increase or decrease in the number of such shares outstanding effected, without receipt of consideration by the Company, or any other occurrence for which the Committee determines an adjustment is appropriate. 62 Table of Contents The purchase price per share of the ordinary shares to be paid upon the exercise of the option must be at least 100% of the fair market value of an ordinary shares on the date on which the option was granted.
Mr. Chen has a background in accounting and tax. He served as the Finance and Tax Manager of Shanghai Huaxiang Woolen Dressing Co., Ltd. from 1995 to 2013. Prior to that, from 1978 to 1994, he served as the Chief Accountant at Gulu Chemical Factory, where he was a member of the senior management.
Chen has a background in accounting and tax. He served as the Finance and Tax Manager of Shanghai Huaxiang Woolen Dressing Co., Ltd. from 1995 to 2013. Prior to that, from 1978 to 1994, he served as the Chief Accountant at Gulu Chemical Factory, where he was a member of the senior management.
We issued bonus shares on January 21, 2022 to shareholders of record as of January 7, 2022; such shareholders received one (1) ordinary share for every two (2) ordinary shares held. All issuances resulting in a fractional share will be rounded down to the next whole share.
We issued bonus shares on January 21, 2022 to shareholders of record as of January 7, 2022; such shareholders received one (1) ordinary share for every two (2) ordinary shares held. All issuances resulting in a fractional share will be rounded down to the next whole share. C.
Among its duties, the Audit Committee: · reviews the Company’s auditing, accounting and financial reporting process; · reviews the adequacy of the Company’s internal controls; · reviews the independence, fee arrangements, audit scope, and performance of the Company’s independent auditors, and recommends the appointment or replacement of independent auditors to the Board of Directors; · reviews and approves all non-audit work, if any, to be performed by the auditors; · reviews the adequacy of the organizational structure; 68 Table of Contents · reviews, before release, the audited consolidated financial statements and operating and financial review and prospects contained in the Company’s Annual Report on Form 20-F, and recommends that the Board of Directors submit these items to the shareholders’ meeting for approval; · provides an open avenue of communication among the Company’s independent auditors, financial and senior management, and the Board of Directors; · reviews and updates the Company’s Code of Business Conduct and Ethics and ensure that there is a system to enforce the same and that this Code complies with all applicable rules and regulations; · ensures that the Company’s management and auditors assess current financial reporting issues and practices; and · reviews and pre-approves both audit and non-audit services to be provided by the Company’s auditors.
Among its duties, the Audit Committee: · reviews the Company’s auditing, accounting and financial reporting process; · reviews the adequacy of the Company’s internal controls; · reviews the independence, fee arrangements, audit scope, and performance of the Company’s independent auditors, and recommends the appointment or replacement of independent auditors to the Board of Directors; · reviews and approves all non-audit work, if any, to be performed by the auditors; · reviews the adequacy of the organizational structure; · reviews, before release, the audited consolidated financial statements and operating and financial review and prospects contained in the Company’s Annual Report on Form 20-F, and recommends that the Board of Directors submit these items to the shareholders’ meeting for approval; · provides an open avenue of communication among the Company’s independent auditors, financial and senior management, and the Board of Directors; · reviews and updates the Company’s Code of Business Conduct and Ethics and ensure that there is a system to enforce the same and that this Code complies with all applicable rules and regulations; · ensures that the Company’s management and auditors assess current financial reporting issues and practices; and · reviews and pre-approves both audit and non-audit services to be provided by the Company’s auditors. 65 Table of Contents D.
SHARE OWNERSHIP The following table sets forth information concerning the beneficial ownership of the Company’s ordinary shares as of April 15, 2024 by (i) each person known to the Company to own 5% or more of the outstanding ordinary shares, (ii) each director and executive officer of the Company, and (iii) all officers and directors of the Company as a group.
SHARE OWNERSHIP The following table sets forth information concerning the beneficial ownership of the Company’s ordinary shares as of April 15, 2025 by (i) each person known to the Company to own 5% or more of the outstanding ordinary shares, (ii) each director and executive officer of the Company, and (iii) all officers and directors of the Company as a group.
During the year ended December 31, 2023, the Company did not grant any options to its officers, directors and employees.
During the year ended December 31, 2023 and 2024, the Company did not grant any options to its officers, directors and employees.
BOARD PRACTICES Terms of Directors and Executive Officers Our board consisted of seven directors for fiscal year 2023. The term of each of the Company’s directors expires at the election and qualification of their successors at the next annual meeting of the Company’s shareholders, anticipated to be held in November of this year.
BOARD PRACTICES Terms of Directors and Executive Officers Our board consisted of seven directors for fiscal year 2024. The term of each of the Company’s directors expires at the election and qualification of their successors at the next annual meeting of the Company’s shareholders, anticipated to be held in November of this year.
Directors of the Company do not receive compensation for their services as directors; however, Board of Directors authorize the payment of compensation to the Directors for their attendance at regular and annual meetings of the Board and for attendance at committee meetings of the Board as is customary for similar companies.
Directors of the Company do not receive compensation for their services as directors; however, our Board of Directors authorizes the payment of compensation to the Directors for their attendance at regular and annual meetings of the Board and for attendance at committee meetings of the Board as is customary for similar companies.
The state-sponsored retirement plans are responsible for the entire pension obligations payable to retired employees. During the year ended December 31, 2023 the aggregate contributions of the Group to the aforementioned pension plans and retirement benefit schemes was US$310,000.
The state-sponsored retirement plans are responsible for the entire pension obligations payable to retired employees. During the year ended December 31, 2024, the aggregate contributions of the Group to the aforementioned pension plans and retirement benefit schemes was US$191,000.
The Company had 3 meetings of its Board of Directors during Fiscal 2023. Board Committee The Board has a standing Audit Committee to assist the Board in carrying out its duties. The Audit Committee has a written charter approved by the Board. The chair of the Audit Committee determines the meeting agenda of the Audit Committee.
The Company had 5 meetings of its Board of Directors during Fiscal 2024. Board Committee The Board has a standing Audit Committee to assist the Board in carrying out its duties. The Audit Committee has a written charter approved by the Board. The chair of the Audit Committee determines the meeting agenda of the Audit Committee.
The compensation expense for Fiscal 2023 is US$47,000. The Group applies the provisions of ASC 718-10, which requires to recognize expense related to the fair value of stock-based compensation awards, including employee stock options. 67 Table of Contents Issuance of Bonus Shares We did not issue any bonus shares during fiscal year 2023.
The compensation expense for Fiscal 2024 is US$12,000. The Group applies the provisions of ASC 718-10, which requires to recognize expense related to the fair value of stock-based compensation awards, including employee stock options. 64 Table of Contents Issuance of Bonus Shares We did not issue any bonus shares during fiscal year 2024 and 2023.
His international experience helped Pact in securing most of the contracts with European and American multinational industries in the PRC. B. COMPENSATION. For the fiscal year ended December 31, 2023, we paid an aggregate of US$840,000 in cash to our executive officers and directors. 64 Table of Contents Compensation of Directors .
His international experience helped Pact in securing most of the contracts with European and American multinational industries in the PRC. B. COMPENSATION. For the fiscal year ended December 31, 2024, we paid an aggregate of approximately US$750,000 in cash to our executive officers and directors. 61 Table of Contents Compensation of Directors .
Changes in outstanding stock options under plans mentioned above were as follows: Year ended December 31, 2023 2022 2021 Number of Options Weighted average exercise price Number of Options Weighted average exercise price Number of Options Weighted average exercise price Outstanding, beginning of year 206,250 1.52 85,000 1.56 51,000 2.60 Granted - - 80,000 2.80 - - Cancelled - - (41,250 ) (1.04 ) Bonus shares adjustment - - 82,500 0.72 34,000 (1.04 ) Outstanding, end of year 206,250 1.52 206,250 1.52 85,000 1.56 Exercisable, end of year 86,250 1.04 86,250 1.04 - - As of December 31, 2023, there was no unrecognized stock-based compensation expense related to unvested stock options.
Changes in outstanding stock options under plans mentioned above were as follows: Year ended December 31, 202 4 202 3 202 2 Number of Options Weighted average exercise price Number of Options Weighted average exercise price Number of Options Weighted average exercise price Outstanding, beginning of year 206,650 1.52 206,250 1.52 85,000 1.56 Granted - - - - 80,000 2.80 Cancelled - - - - (41,250 ) (1.04 ) Bonus shares adjustment - - - - 82,500 0.72 Outstanding, end of year 206,250 1.52 206,250 1.52 206,250 1.52 Exercisable, end of year 206,250 1.52 86,250 1.04 86,250 1.04 As of December 31, 2024, there was no unrecognized stock-based compensation expense related to unvested stock options.
David YL Leung has served as the Chief Executive Officer of both the Company and Far East since February 1, 2022, has served as a Director of the Company since March, 2019, and has served as the General Manager of Yixing since 2011. Mr.
David YL Leung has served as the Chief Executive Officer of both the Company and Far East since February 1, 2022, has served as a Director of the Company since March, 2019, and has served as the General Manager of Yixing since 2011. Mr. Leung has also served as a director of Euro Tech Global since its incorporation in 2025.
The Audit Committee members receive materials in advance of Committee meetings allowing them to prepare for the meeting. During Fiscal 2023, our Audit Committee had 4 meetings. The Audit Committee currently consists of Y.K. Liang, Janet Cheang and Fu Ming Chen. The Audit Committee’s “financial expert” is Y.K. Liang.
The Audit Committee members receive materials in advance of Committee meetings allowing them to prepare for the meeting. During Fiscal 2024, our Audit Committee had 3 meetings. The Audit Committee currently consists of Yi Sun, Janet Cheang and Fu Ming Chen. The Audit Committee’s “financial expert” is Yi Sun.
These Shares, however, are not included in the computation of the percentage ownership of any other person. The calculations of percentage ownership in the table below are based on 7,716,299 ordinary shares outstanding as of April 15, 2024. 70 Table of Contents None of our existing shareholders have different voting rights from other shareholders.
These Shares, however, are not included in the computation of the percentage ownership of any other person. The calculations of percentage ownership in the table below are based on 7,616,844 ordinary shares outstanding as of April 15, 2025. 66 Table of Contents None of our existing shareholders has different voting rights from other shareholders.
The Company’s directors were re-elected at the Company’s last annual meeting of shareholders in November 2023. In addition, the service agreement between us and the directors do not provide benefits upon termination of their services. Our officers are elected by and serve at the discretion of the board of directors.
In addition, the service agreement between us and the directors do not provide benefits upon termination of their services. Our officers are elected by and serve at the discretion of the board of directors.
Sham was employed by the Environmental Protection Department of the Hong Kong Government from 1986 until 1988. Mr. Sham received a Master’s Degree in Business Administration from the University of Adelaide in 2003. 63 Table of Contents Y.K. Liang has been a Director of the Company since February 1998. Mr.
Sham was employed by the Environmental Protection Department of the Hong Kong Government from 1986 until 1988. Mr. Sham received a Master’s Degree in Business Administration from the University of Adelaide in 2003. 60 Table of Contents Yi Sun has been a Director of the Company since December 9, 2024. Mr.
He also holds a Certificate of Accounting Professional – Intermediate Level Accountant as well as a Higher Professional Education Certificate issued by Shanghai Television University. Janet Cheang has been a Director of the Company since July 11, 2017. She is currently director of Metta Fine Arts Ltd., an online art gallery specializing in the promotion and trading of contemporary arts.
He also holds a Certificate of Accounting Professional – Intermediate Level Accountant as well as a Higher Professional Education Certificate issued by Shanghai Television University. Janet Cheang has been a Director of the Company since July 11, 2017. She is currently an independent art consultant and art dealer.
We have never experienced any employment related work stoppages, and we consider our relations with our employees to be good. The Company’s management consists of its officers and directors. E.
None of our employees is represented by a labor union or covered by a collective bargaining agreement. We have never experienced any employment related work stoppages, and we consider our relations with our employees to be good. The Company’s management consists of its officers and directors. E.
Leung also served as managing director of Eurotherm (Far East) Ltd. (“Eurotherm”) between 1971 and 1992. From 1988 until his retirement in February 2005, Mr. Leung also served as managing director of Eurotherm Hong Kong. Mr.
Leung was an engineer for English Electric in England, from 1965 to 1968, and Lockheed Aircraft in Hong Kong, from 1968 to 1970. Mr. Leung also served as managing director of Eurotherm (Far East) Ltd. (“Eurotherm”) between 1971 and 1992. From 1988 until his retirement in February 2005, Mr. Leung also served as managing director of Eurotherm Hong Kong. Mr.
On December 31, 2023, 2022, and 2021, staffing levels at the Company (exclusive of Yixing-Pact) were as follows respectively: 2023 2022 2021 Marketing and sales 7 7 11 Administrative 13 13 16 Technical 3 4 11 Total full-time employees 23 24 38 On March 31, 2024, Pact-Yixing had 24 full-time employees.
EMPLOYEES As of December 31, 2024, 2023, and 2022, staffing levels at the Company (excluding Yixing) were as follows respectively: 202 4 202 3 202 2 Marketing and sales 7 7 7 Administrative 13 13 13 Technical 3 3 4 Total full-time employees 23 23 24 On December 31, 2024, 2023, and 2022, staffing levels at Yixing were as follows respectively: 202 4 202 3 202 2 Administrative 6 6 6 Technical 18 18 19 Total full time employees 24 24 25 Our employees are located in Hong Kong and mainland China.
From 2007 to 2017, she founded and operated Pinpoint Consultancy Limited, a business consultancy firm specializing in business development and executive coaching for companies operating in Hong Kong and mainland China. From 2003 to 2007, she was founding partner and managing director of Culture Tainment Services Ltd., responsible for business and brand development consultancy and training projects.
From 2003 to 2007, she was founding partner and managing director of Culture Tainment Services Ltd., responsible for business and brand development consultancy and training projects. From 1997 to 2002, she had worked for Estee Lauder (Hong Kong) Ltd. as the Brand General Manager for Estee Lauder brand in Hong Kong and mainland China.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. DIRECTORS AND SENIOR MANAGEMENT Information concerning the Directors and Executive Officers of the Company are as follows: Name Age Position T.C. Leung 80 Chairman of the Board of Directors David YL Leung 50 Director and Chief Executive Officer Jerry Wong 65 Director and Chief Financial Officer Alex Sham 60 Director Y.K.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. DIRECTORS AND SENIOR MANAGEMENT Information concerning the Directors and Executive Officers of the Company are as follows: Name Age Position T.C.
Leung also served as the Chief Executive Officer of both the Company and Far East from their respective inception until February 1, 2022. Before establishing Far East, Mr. Leung was an engineer for English Electric in England, from 1965 to 1968, and Lockheed Aircraft in Hong Kong, from 1968 to 1970. Mr.
Leung has served as the Chairman of the Board of Directors of both the Company and Far East since their respective inception. Mr. Leung also served as the Chief Executive Officer of both the Company and Far East from their respective inception until February 1, 2022. Before establishing Far East, Mr.
This share option is granted under our 2019 Stock Option and Incentive Plan. F. D ISCLOSURE OF A REGISTRANT’S ACTION TO RECOVER ERRONEOUSLY AWARDED COMPENSATION Not applicable.
(4) This includes the share option which is exercisable from April 1, 2024 to April 18, 2029 to purchase 75,000 ordinary shares at the purchase price of $1.8674 per share. This share option is granted under our 2019 Stock Option and Incentive Plan. F. DISCLOSURE OF A REGISTRANT’S ACTION TO RECOVER ERRONEOUSLY AWARDED COMPENSATION Not applicable.
Liang 94 Director Fu Ming Chen 75 Director Janet Cheang 68 Director Set forth below is a brief background of the executive officers and directors based upon the information supplied by them to the Company: T.C. Leung has served as the Chairman of the Board of Directors of both the Company and Far East since their respective inception. Mr.
Leung 81 Chairman of the Board of Directors David YL Leung 51 Director and Chief Executive Officer Jerry Wong 66 Director and Chief Financial Officer Alex Sham 61 Director Yi Sun 48 Director Fu Ming Chen 76 Director Janet Cheang 69 Director Set forth below is a brief background of the executive officers and directors based upon the information supplied by them to the Company: T.C.
(1) The address for the Company’s officers and directors is c/o Euro Tech (Far East) Ltd., Unit D, 18/F., Gee Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong. (2) This includes the share option which is exercisable from January 1, 2022 to April 18, 2029 to purchase 18,750 ordinary shares at the purchase price of $1.04 per share.
(2) This includes the share option which is exercisable from January 1, 2022 to April 18, 2029 to purchase 18,750 ordinary shares at the purchase price of $1.04 per share. This share option is granted under our 2019 Stock Option and Incentive Plan.
Amount And Nature of Beneficial Ownership Approximate Percentage Of Ordinary Shares Owned T.C. Leung (1) 3,994,647 51.8 % Alex Sham(1) 201,452 2.6 % Jerry Wong(1) 130,742 1.7 % Y.K.
Amount And Nature of Beneficial Ownership Approximate Percentage Of Ordinary Shares Owned T.C.
Removed
Liang was a director of Wong Liang Consultants Ltd., a general business consulting firm, and a member of the certified public accounting firm of Y.K. Liang & Co.. Mr. Liang has been a director of Sammy Lau CPA Limited for more than the past ten years. Fu Ming Chen has been a Director of the Company since August 24, 2015.
Added
Sun serves as the Head of Accounting, Taxation and Personnel Department at Kanematsu (China) Co., Ltd (Trading) and Kanekoh Electronics (Shanghai) Co., Ltd. (Manufacturing), both of which are wholly owned subsidiaries of a Japanese company listed on Tokyo Stock Exchange. From 1997 to 2000, Mr.
Removed
From 1997 to 2002, she had worked for Estee Lauder (Hong Kong) Ltd. as the Brand General Manager for Estee Lauder brand in Hong Kong and mainland China.
Added
Sun served as the Head of Accounting and Labor Division at Devanlay Garment (Shanghai) Co., Ltd.. Mr. Sun holds a diploma in accounting profession from Shanghai LiXin University of Accounting and Finance. Mr.
Removed
We issued bonus shares on March 2, 2021 to shareholders of record as of February 23, 2021; such shareholders received two (2) ordinary shares for every three (3) ordinary shares held. All issuances resulting in a fractional share were rounded down to the next whole share. C.
Added
Sun is a Senior International Financial Manager as awarded by China Association of Chief Financial Officers and the International Financial Management Association and a Certified Senior Accountant as awarded by Shanghai Municipal Finance Bureau, Human Resources and Social Security Bureau. Fu Ming Chen has been a Director of the Company since August 24, 2015. Mr.
Removed
Board Diversity Matrix Board Diversity Matrix Country of Principal Executive Offices China Foreign Private Issuer Yes Disclosure Prohibited Under Home Country Law No 69 Table of Contents D. EMPLOYEES On March 31, 2024, the Company (exclusive of Yixing-Pact) had 23 full-time employees. The Company’s employees are located at Hong Kong and mainland China.
Added
She was founder and director of Metta Fine Arts Ltd., an online art gallery specializing in the promotion and trading of contemporary arts, from 2008 to 2025. From 2007 to 2017, she founded and operated Pinpoint Consultancy Limited, a business consultancy firm specializing in business development and executive coaching for companies operating in Hong Kong and mainland China.
Removed
On December 31, 2023, 2022 and 2021, staffing levels at Pact-Yixing were as follows respectively: 2023 2022 2021 Administrative 6 6 7 Technical 18 19 22 Total full time employees 24 25 29 None of our employees are represented by a labor union or covered by a collective bargaining agreement.
Added
The Company’s directors were re-elected at the Company’s last annual meeting of shareholders in November 2024, except Mr. Y.K. Liang passed away shortly before such annual meeting of shareholders and our board of directors elected Mr. Yi Sun as a director in December, 2024.
Removed
Liang(1) — — Fu Ming Chen(1) — — Janet Cheang(1) — — David YL Leung(1) 18,750 (2) * All Executive Officers and Directors of the Company as a group (7 persons) 4,345,591 56.3 % * This person beneficially owns less than 1% of our outstanding ordinary shares.
Added
Leung (1) 3,998,447 52.5 % Alex Sham(1) 201,452 2.6 % Jerry Wong(1) 153,242 (3) 2.0 % Yi Sun(1) — — Fu Ming Chen(1) — — Janet Cheang(1) — — David YL Leung(1) 94,250 (2)(4) 1.2 % All Executive Officers and Directors of the Company as a group (7 persons) 4,447,391 57.51 % (1) The address for the Company’s officers and directors is c/o Euro Tech (Far East) Ltd., Unit D, 18/F., Gee Chang Hong Centre, 65 Wong Chuk Hang Road, Hong Kong.
Added
(3) This includes the share option which is exercisable from April 1, 2024 to April 18, 2029 to purchase 22,500 ordinary shares at the purchase price of $1.8674 per share. This share option is granted under our 2019 Stock Option and Incentive Plan.

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