Annual Report 2020

REPORT OF THE DIRECTORS 20 The United Laboratories International Holdings Limited Annual Report 2020 SHARE PREMIUM AND RESERVES In accordance with the Companies Law, Chapter 22 (as revised) of the Cayman Islands, and the Company’s articles of association, the Company may distribute its share premium to shareholders in the forms of dividend or fully paid bonus shares, provided that immediately following the distribution or payment of dividend, the Company will be in a position to pay off its debts as and when they fall due in the ordinary course of business. As at the reporting date, the directors were of the opinion that the distributable share premium and reserves of the Company was approximately RMB4,650.9 million. Details of movements in the share premium and reserves of the Group during the year are set out in consolidated statement of changes in equity on pages 42 and 43 of this annual report. PRE-EMPTIVE RIGHTS There are no provisions for pre-emptive rights under the Company’s articles of association or the laws of the Cayman Islands which would oblige the Company to offer new shares on a pro-rata basis to existing shareholders. MAJOR CUSTOMERS AND SUPPLIERS In 2020, the aggregate sales attributable to the Group’s five largest customers accounted for less than 30% of the Group’s total sales for the year. In 2020, the aggregate purchases attributable to the Group’s largest and five largest suppliers accounted for 18.8% and 39.4% respectively of the Group’s total purchases for the year. None of the directors or chief executive or any of their associates or any shareholder (which, to the knowledge of the directors, owns more than 5% of the Company’s issued share capital) had any beneficial interest in any of the Group’s five largest customers and suppliers.