P B : ANNUAL REPORT 2021

(incorporated in Cayman Islands with limited liability)

(Stock code: 8331)

ANNUAL REPORT

CHARACTERISTICS OF GEM OF THE STOCK EXCHANGE OF HONG KONG LIMITED THE "STOCK EXCHANGE"

GEM has been positioned as a market designed to accommodate small and mid-sized companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration.

Given that the companies listed on GEM are generally small and mid-sized, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this report, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this report.

This report, for which the directors (the "Directors") of P.B. Group Limited (the "Company", together with its subsidiaries, the "Group") collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the GEM of the Stock Exchange (the "GEM Listing Rules") for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this report is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this report misleading.

Contents

Corporate Information 3

Chairmen's Statement 4

Management Discussion and Analysis 5

Profiles of Directors and Senior Management 25

Report of the Directors 27

Corporate Governance Report 36

Environmental, Social and Governance Report 50

Independent Auditor's Report 95

Consolidated Statement of Profit or Loss and Other Comprehensive Income 99

Consolidated Statement of Financial Position 100

Consolidated Statement of Changes in Equity 102

Consolidated Statement of Cash Flows 103

Notes to the Consolidated Financial Statements 105

Financial Summary 160

Corporate Information

BOARD OF DIRECTORS

REGISTERED OFFICE

Executive Directors

Dr. CHAN Man Fung (Co-chairman) Mr. PUI Wai Lun (Co-chairman)

Mr. SU Chun Xiang

Mr. PANG Ho Yin (Chief Executive Officer)

Independent Non-executive Directors

Mr. YIP Chong Ho Eric (appointed on 23 April 2021) Mr. CHOW Chi Hang Tony

Mr. ZHANG Kun

AUTHORISED REPRESENTATIVES

Dr. CHAN Man Fung

Ms. CHIK Wai Chun

71 Fort Street

P.O. Box 500, George Town Grand Cayman KY1-1106 Cayman Islands

HONG KONG OFFICE AND PRINCIPAL PLACE OF BUSINESS

Room 402A, 4/F

Park Commercial Centre 180 Tung Lo Wan Road Causeway Bay, Hong Kong

COMPANY'S WEBSITE

COMPANY SECRETARY

www.thepbg.com

Ms. CHIK Wai Chun

COMPLIANCE OFFICER

COMPANY'S STOCK CODE

8331.HK

Mr. SU Chun Xiang

AUDIT COMMITTEE

Mr. YIP Chong Ho Eric (Chairman)

(appointed on 23 April 2021) Mr. CHOW Chi Hang Tony

Mr. ZHANG Kun

NOMINATION COMMITTEE

Mr. CHOW Chi Hang Tony (Chairman)

Mr. YIP Chong Ho Eric (appointed on 23 April 2021) Mr. ZHANG Kun

REMUNERATION COMMITTEE

Mr. YIP Chong Ho Eric (Chairman)

(appointed on 23 April 2021) Mr. CHOW Chi Hang Tony

Mr. ZHANG Kun

AUDITORS

BDO Limited

25th Floor, Wing On Centre 111 Connaught Road Central Hong Kong

PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE

Appleby Global Services (Cayman) Limited 71 Fort Street

P.O. Box 500, George Town Grand Cayman KY1-1106 Cayman Islands

HONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICE

Tricor Investor Services Limited Level 54, Hopewell Centre

183 Queen's Road East Hong Kong

LEGAL ADVISERS

(As to Cayman Islands Law)

Appleby Global Services (Cayman) Limited

PRINCIPAL BANKERS

Bank of China Limited (Wuhu branch) Industrial and Commercial Bank of China

(Fanchang branch)

Chairmen's Statement

Dear Shareholders,

On behalf of the board of directors (the "Board") of P.B. Group Limited and its subsidiaries (collectively, the "Group"), we hereby present the audited consolidated results of the Group for the year ended 31 December 2021 (the "Year").

During the Year, the Group's revenue was approximately CNY70.9 million (2020: CNY55.7 million), of which the Bentonite Mining business in the People's Republic of China (the "PRC") recorded a segment revenue of approximately CNY60.7 million (2020: CNY52.2 million), accounting for approximately 86% of the Group's revenue. The increase in revenue was mainly contributed by recovery of macroeconomics in the PRC and the lockdown of Hubei province were released compared to the corresponding period in 2020.

Although the PRC has generally kept COVID-19 under control, and economic activities and confidence have rapidly recovered, it is expected that the uncertainties due to COVID-19, international trade conflicts, Russo-Ukrainian War and the new series of real estate market regulation and control policies will continue causing price fluctuation on iron and steel and causing pressure on the traditional energy industries in the long term, which will negatively impact the Group's business by imposing pressures on demand for pelletising clay and drilling mud. The Group expect that the Bentonite Mining business remain challenging in the coming year. The Group will continue adhere to prudent financial management and cost control for this segment.

For Financial Services business segment, as the subsidiaries, P.B. Nikyo Wealth Management Limited (formerly known as Nikyo Insurance Brokers Limited) (''P.B. Nikyo'') and P.B. Credit Limited (formerly known as P.B. Investment Limited) ("P.B. Credit"), were newly acquired by the Company in November 2020. As disclosed in the interim report of the Company for the six months ended 30 June 2021 and third quarterly report for the nine months ended 30 September 2021, it has been a challenging year for the Financial Services segment including wealth management and money lending business, as the COVID-19 has unfortunately persisted, which brought lingering impacts to the operation of the Financial Services segment during the year 2021. The revenue of Financial Services segment amounted to approximately CNY10.2 million for the Year, accounting for approximately 14% of the Group's revenue (November-December 2020: CNY3.5 million). As Hong Kong's exit strategy needs to balance virus risks and reopening of border , the Group expects that the business environment in financial services, including wealth management and money lending business, would remain challenging in the year 2022. Nevertheless, with the expectation of increasing awareness in wealth management in recent years, as well as the probable easing of travel restrictions between Hong Kong and Mainland China, the Group remains cautiously optimistic in the medium and long-term development of wealth management business of the Group.

From the last twelve months, we believe the key lesson is that the economic environment could be fast changing and unpredictable, the only way to ease market pressure is to cautiously monitor market change and impose robust control measures to improve cost efficiency and risk management in order to provide a solid foundation for sustainable growth in the future.

On behalf of the Board, we would like to express our sincerest gratitude to our shareholders, customers and suppliers for their continuous support. We would also like to send our warmest thanks to all our management and staff members for their hard work and dedication throughout the years.

CHAN Man Fung Co-chairman

PUI Wai Lun Co-chairman

Hong Kong, 25 March 2022