Revenue Performance - The Group's revenue decreased by 11.9% to RMB252.1 million compared to RMB286.3 million in the same period last year[9]. - Revenue from the manufacturing and sales of wooden products was RMB249.1 million, accounting for 98.8% of total revenue, down from RMB282.9 million[14]. - The retail sales of outdoor wooden products generated no revenue during the period, compared to RMB219 thousand in the previous year[12]. - Revenue from the manufacturing and sales of renewable energy products contributed RMB3.0 million, down from RMB3.4 million[14]. - Revenue from the wooden products segment decreased by 11.9% to approximately RMB249.1 million, accounting for 98.8% of total revenue during the period[17]. - Revenue from the North America market reduced to approximately RMB54.4 million, which accounted for 22% of total revenue, down from 41% in the same period last year[29]. - Revenue from the PRC market significantly decreased to approximately RMB5.9 million, representing only 2% of total revenue, compared to 16% in the previous year[30]. - The Australasia market became the largest income source, with revenue of approximately RMB171.0 million, accounting for 68% of total revenue, up from 36% in the previous year[27]. - Revenue from timber houses and their related parts decreased by 6.6% to RMB214.9 million, representing 85.2% of total sales for the period[33]. - Overall revenue from leisure household products decreased by 11.4% to RMB34.2 million, mainly due to a decrease in sales of recreational products[35]. - Revenue from trading of timber became nil, down from RMB14.2 million in the previous year due to trade friction between China and the United States[35]. Profitability and Margins - The gross profit margin improved to 14.6%, resulting in a profit of approximately RMB4.2 million, a turnaround from a loss of RMB28.0 million in the previous year[9]. - The reportable segment profit from manufacturing and sales of wooden products was approximately RMB10.3 million, compared to a loss of RMB31.7 million in the previous year[16]. - The renewable energy business revenue decreased by 12.4% to RMB3.0 million, with a profit of approximately RMB0.4 million, consistent with the previous year[22]. - The Group recorded a profit of approximately RMB4.2 million for the period, compared to a loss of RMB28.0 million in the previous year[48]. - Gross profit for the same period was RMB36,874,000, compared to a gross loss of RMB3,637,000 in 2020, indicating a significant recovery[128]. - Profit for the period was RMB4,249,000, a turnaround from a loss of RMB27,992,000 in the previous year[130]. Market and Strategic Adjustments - The trade friction with the United States has severely impacted the Group's wooden products segment, leading to a negative gross profit margin prior to the shift in marketing focus[16]. - The Group's marketing strategy has successfully shifted to Australasia, resulting in a gross profit margin of 5.9% from this region[16]. - The Group anticipates further increases in selling costs to the United States due to new anti-dumping duties and countervailing duties[16]. - The Department of Commerce of the United States has imposed a cash deposit requirement of 54.43% on imports of relevant products from China[16]. - The Group has shifted its marketing focus to Australia due to escalating trade tensions and tariffs affecting its U.S. operations[18]. - The Group's strategy includes adjusting its business direction in the retail segment to expand its presence in the PRC household product market[21]. - The Group anticipates continued growth in the Australasian market due to strong private investment and public demand, with an estimated GDP growth of 9.5% in Australia[27]. Financial Position and Assets - As of June 30, 2021, the Group had current assets of RMB500.4 million, an increase from RMB423.3 million at the end of 2020[49]. - Total assets less current liabilities increased to RMB831,588,000 as of June 30, 2021, compared to RMB819,115,000 at December 31, 2020, reflecting a growth of 1.8%[134]. - Net assets rose to RMB824,137,000 at June 30, 2021, up from RMB812,602,000 at December 31, 2020, indicating an increase of 1.9%[134]. - Trade and other receivables rose significantly to RMB212,560,000 from RMB134,800,000, reflecting improved collection efforts[133]. - Cash and cash equivalents increased to RMB165,441,000 from RMB137,969,000, indicating better liquidity[133]. - Non-current assets decreased slightly to RMB442,647,000 from RMB455,592,000, primarily due to depreciation[133]. Shareholder Information and Corporate Governance - The Group's emolument policies are based on individual performance and are reviewed periodically, with discretionary bonuses awarded based on performance assessments[74]. - The maximum number of shares that can be granted under the Share Option Scheme is capped at 10% of the total number of shares in issue, equating to 100,000,000 shares[91]. - The Share Option Scheme was adopted to recognize contributions from eligible participants, including directors and employees[93]. - The Company has adopted a Share Award Scheme allowing for the issuance of up to 20% of the total issued shares, which amounts to 741,200,400 shares[101][102]. - The Board has resolved not to declare any interim dividend for the Period[111][114]. - The Company has complied with the Corporate Governance Code, except for code provision C.1.2 regarding monthly updates to all Board members[116][118]. Cash Flow and Financing Activities - For the six months ended June 30, 2021, the net cash used in operating activities was RMB (35,458) thousand, a significant decrease compared to RMB 66,577 thousand generated in the same period of 2020[141]. - The net cash from investing activities was RMB 4,000 thousand, recovering from a net cash used of RMB (3,905) thousand in the previous year[143]. - The net cash from financing activities increased to RMB 58,978 thousand, compared to a net cash used of RMB (22,782) thousand in the same period of 2020[143]. - The company received proceeds from new bank loans totaling RMB 57,070 thousand, a substantial increase from RMB 7,801 thousand in the prior year[143]. - The total cash and cash equivalents at June 30, 2021, amounted to RMB 165,441 thousand, up from RMB 116,274 thousand at the end of the previous year[143]. Taxation and Compliance - Current tax for the six months ended June 30, 2021, was RMB 120,000, compared to RMB 129,000 in 2020, showing a minor decrease of about 7%[197]. - Deferred tax expense for the six months ended June 30, 2021, was RMB 1,052,000, compared to a credit of RMB 728,000 in 2020, indicating a significant change in tax position[197]. - The Group's other PRC subsidiaries are subject to a corporate income tax rate of 25%[198]. - Zhangping Kimura is entitled to a preferential income tax rate of 15% for the period from 2019 to 2021 due to its qualification as a High and New Technology Entity[199].

Financial Performance - The Group's revenue for the year ended December 31, 2020, was approximately RMB 492.6 million, representing a decline of 29.0% compared to RMB 694.1 million in 2019[10][15] - The Group recorded a loss of RMB 93.1 million for the year, an increase of approximately 44.4% from the loss of RMB 64.5 million in 2019[10][15] - The Group's gross profit for 2020 was RMB 4.4 million, a significant decline from RMB 8.6 million in 2019[10] - The loss per share for the year was RMB 0.128, compared to RMB 0.104 in 2019[10] - Total revenue decreased by 29.0% to RMB492.6 million in 2020, down from RMB694.1 million in 2019[30] - Revenue from the manufacturing and sales of wooden products, the largest business segment, decreased by 29.3% due to reduced demand from North American clients[31] - Revenue from timber houses and their related parts and structures decreased by 34.1% to RMB374.0 million, primarily due to anti-dumping investigations affecting sales to North America[39] - Revenue from leisure household products increased by 25.5% to RMB90.6 million, driven by higher sales of landscape garden products[40] - Gross profit decreased to approximately RMB4.4 million, with a gross margin of 0.9%, down from 1.2% in 2019, mainly due to increased sales discounts[43] - Other revenue decreased to RMB17.6 million, primarily due to a reduction in government subsidies to RMB10.0 million from RMB18.2 million in 2019[51] Assets and Liabilities - Total assets as of December 31, 2020, amounted to RMB 878.9 million, a decrease from RMB 981.4 million in 2019[12] - Total liabilities decreased to RMB 66.3 million in 2020 from RMB 95.8 million in 2019[12] - Total equity as of December 31, 2020, was RMB 812.6 million, down from RMB 885.6 million in 2019[12] - As of December 31, 2020, the Group had current assets of RMB 423.3 million, down from RMB 455.0 million in 2019, with bank deposits and cash totaling RMB 142.6 million, an increase from RMB 83.6 million in 2019[58] - The Group's total available banking facilities amounted to RMB 97.7 million as of December 31, 2020, down from RMB 151.7 million in 2019, with utilized banking facilities of RMB 27.5 million[59] - The current ratio and quick ratio as of December 31, 2020, were 7.1:1 and 5.2:1, respectively, compared to 6.0:1 and 3.0:1 in 2019[60] Expenses - Selling and distribution expenses decreased to RMB 21.7 million in 2020 from RMB 25.6 million in 2019[10] - Administrative expenses increased to RMB 57.7 million in 2020 compared to RMB 48.3 million in 2019[10] - Finance costs decreased to approximately RMB 0.2 million from RMB 1.8 million, attributed to a reduction in bank borrowings[48] - The Group recorded an other net loss of RMB 36.2 million for the period, an increase from RMB 4.7 million in 2019, primarily due to impairment of construction in progress amounting to RMB 24.6 million[52] - Sales and distribution expenses for the period were RMB 21.7 million, down from RMB 25.6 million in 2019, mainly due to a decline in revenue and shipment volume[53] - Administrative expenses increased to RMB 57.7 million from RMB 48.3 million in 2019, primarily due to share-based payment expenses of RMB 5.8 million recognized during the year[54] Market and Regulatory Environment - The U.S. Department of Commerce found that exporters received countervailable subsidies at rates from 13.61% to 245.34% for wood products from China[19] - The Group's wholly-owned subsidiary, Zhangping Kimura Forestry Products Co., Ltd., was determined to have a dumping margin of 79.4% for certain wood products exported to the U.S.[20] - The Group has ceased exports of affected products to U.S. customers starting August 2020 due to preliminary determinations[20] - The Group plans to focus on markets outside the United States and will continue to monitor developments in overseas markets[21] - The Group expects that U.S. trade measures against China will not significantly change under the new government[21] Employment and Governance - As of December 31, 2020, the company employed a total of 340 full-time employees, a decrease from 464 in 2019[85] - The company has adopted a Share Award Scheme, awarding a total of 42,550,000 Award Shares to 12 selected participants to incentivize and retain talent[87] - The company has complied with all applicable code provisions in the Corporate Governance Code throughout the year, except for certain disclosed deviations[95] - The Board consists of two executive Directors and three non-executive Directors, ensuring a balanced governance structure[111] - The Board held only two regular meetings during the year, which is below the required minimum of four meetings[106] Committees and Compliance - The Audit Committee comprises all independent non-executive Directors and is tasked with overseeing financial reporting, risk management, and internal control systems[142] - The Board has established four committees, including the audit committee, remuneration committee, nomination committee, and risk management committee, to oversee specific aspects of the Company's affairs[141] - The Audit Committee is responsible for monitoring the external auditor's independence and effectiveness of the audit process, ensuring compliance with applicable standards[149] - The Audit Committee reviewed the financial statements for the year ended December 31, 2019, and the interim results for the six months ended June 30, 2020, recommending approval to the Board[150] - The Remuneration Committee reviewed the remuneration policy and structure for executive Directors and senior management, providing recommendations to the Board[157] Risk Management - The Risk Management Committee comprises all independent non-executive Directors, focusing on evaluating the Group's risk management framework and policies[180] - The Risk Management Committee has reviewed material risk exposures, including market, credit, and operational risks, to monitor and control such exposures[182] - The Company acknowledges its responsibility for preparing financial statements in accordance with International Financial Reporting Standards[184] - There are no material uncertainties that may cast significant doubt on the Company's ability to continue as a going concern[185]

Financial Performance - The Group's revenue decreased by 25.4% to RMB 286.3 million compared to RMB 384.0 million in the same period last year[10]. - The Group recorded a net loss of RMB 28.0 million, worsening from a loss of RMB 14.7 million in the previous year[10]. - Gross profit margin fell to -1.3% from 3.5% year-on-year[8]. - The overall revenue for the Group decreased by 25.4% to RMB 286.3 million compared to RMB 384.0 million in the same period last year[27]. - The loss in the manufacturing and sales of wooden products segment expanded to approximately RMB 31.7 million, compared to RMB 20.4 million in the previous year[20]. - The company reported a loss for the period of RMB 27,992,000 for the six months ended June 30, 2020, compared to a loss of RMB 14,673,000 in the same period of 2019, representing an increase in loss of approximately 90.5%[134]. - Total comprehensive income for the period was RMB (27,118,000), compared to RMB (16,318,000) in the prior year, indicating a decline of approximately 66.1%[134]. - Loss from operations increased to RMB 26,922,000, up from RMB 13,831,000 in the same period last year[132]. - Loss before taxation was RMB 28,591,000, compared to RMB 16,101,000 in the prior year[132]. Revenue Breakdown - Revenue from the manufacturing and sales of wooden products decreased by 25.6% to approximately RMB 282.9 million, contributing 98.8% of total revenue[15]. - Revenue from timber houses and related parts decreased significantly, with revenue dropping to RMB 230.1 million from RMB 317.4 million[8]. - Revenue from renewable energy products remained stable at approximately RMB 3.4 million, with a profit of approximately RMB 0.4 million[22]. - The North American market revenue dropped by 44.3% to RMB 118.4 million, representing 41% of total revenue, down from 55% in the previous year[27]. - Revenue from the PRC market fell by 19.7% to RMB 45.8 million, representing 16% of total revenue, compared to 15% in 2019[30]. - Australasia market became the second largest income stream, accounting for 36% of total revenue, with a 15.6% increase in revenue to RMB 102.9 million[31]. - Revenue from outdoor wooden products decreased to RMB 282,900,000 in the first half of 2020, down 25.7% from RMB 380,354,000 in the same period of 2019[166]. - Revenue from renewable energy products was RMB 3,398,000 in the first half of 2020, slightly down from RMB 3,436,000 in the same period of 2019[166]. Cost Management - Administrative expenses decreased to RMB 20.2 million, reflecting tightened cost control measures[47]. - Administrative expenses decreased to RMB 20.2 million, down from RMB 22.5 million in the first half of 2019, due to enhanced cost control measures[53]. - Financing costs reduced to approximately RMB 0.7 million, compared to RMB 2.0 million in the first half of 2019, primarily due to a decrease in bank borrowings[54]. Market Conditions - The Group's operating results were impacted by intensified trade conflicts[10]. - The U.S. Department of Commerce announced countervailable subsidies for wood products imported from China ranging from 13.61% to 245.34%[17]. - The Group plans to enhance product competitiveness and monitor market trends closely due to adverse impacts from Sino-U.S. trade disputes[27]. - The Group anticipates that 2020 will be filled with difficulties and challenges due to the COVID-19 pandemic and geopolitical tensions, prompting a review of business strategies[76]. Assets and Liabilities - Current ratio improved to 5.5:1 from 5.1:1 in the previous year[8]. - Quick ratio increased to 3.8:1 from 2.6:1 year-on-year[8]. - Current assets as of June 30, 2020, amounted to RMB 445.0 million, slightly down from RMB 455.0 million as of December 31, 2019[58]. - Total available banking facilities increased to RMB 324.3 million as of June 30, 2020, up from RMB 237.2 million as of December 31, 2019[59]. - Non-current assets decreased from RMB 526,472,000 as of December 31, 2019, to RMB 514,180,000 as of June 30, 2020, a reduction of about 2.5%[137]. - The company's equity decreased from RMB 885,633,000 at the end of 2019 to RMB 871,689,000 as of June 30, 2020, a reduction of about 1.6%[138]. Employee and Corporate Governance - As of June 30, 2020, the total number of employees decreased to 284 from 535 in June 2019, indicating a reduction in workforce[86]. - The company emphasizes automation in production processes and staff training to enhance competitiveness[86]. - The company has a competitive salary package and contributes to social insurance for its employees[87]. - The Company has complied with the principles set out in the Corporate Governance Code, except for code provision C.1.2[120]. Shareholder Information - As of June 30, 2020, Mr. Wu Zheyan holds a long position of 89,929,482 shares, representing approximately 12.13% of the company's shares[95]. - The entire issued share capital of Green Seas Capital Limited is owned by Mr. Wu Zheyan, linking him to the shares held[106]. - Hong Kong Run De Holdings Limited and its controlled corporation hold 86,000,000 shares, accounting for 11.60% of the total shareholding[100]. - Hong Kong Guoyuan Group Capital Holdings Limited has a significant interest with 140,350,000 shares, which is 18.59% of the total[101]. Cash Flow and Investments - Cash generated from operations for the six months ended June 30, 2020, was RMB 66,577,000, a decrease of 9% from RMB 73,153,000 in 2019[145]. - The net cash used in investing activities was RMB 3,905,000 for the six months ended June 30, 2020, compared to RMB 10,192,000 in 2019, indicating a reduction in cash outflow[145]. - The company recorded a net increase in cash and cash equivalents of RMB 39,890,000 for the six months ended June 30, 2020, compared to an increase of RMB 13,606,000 in 2019[146]. - As of June 30, 2020, cash and cash equivalents totaled RMB 116,274,000, up from RMB 51,623,000 at the end of the same period in 2019[146].

Financial Performance - Revenue for the year ended December 31, 2019, was RMB 694,052,000, an increase of 9.4% from RMB 634,686,000 in 2018[8] - Gross profit decreased significantly to RMB 8,624,000, resulting in a gross profit margin of 1.2%, down from 10.8% in the previous year[8] - The net loss for 2019 was RMB 64,471,000, improving from a net loss of RMB 184,931,000 in 2018, with a net profit margin of -9.29%[8] - The Group recorded a loss of RMB 64.5 million for the year, a significant decrease from the loss of approximately RMB 184.9 million in 2018, primarily due to no significant additional impairment of assets required in 2019[18] - The impairment of assets recognized in 2018 amounted to approximately RMB 139.3 million, which was not repeated in 2019[18] - The Group anticipates challenges in profitability due to external factors such as the global economic slowdown and the COVID-19 outbreak[23] - The Group's overall profitability is expected to be under pressure due to various unfavorable external and domestic factors affecting asset and inventory returns[25] Assets and Liabilities - Current assets decreased to RMB 454,973,000 from RMB 618,361,000 in 2018, while current liabilities reduced to RMB 89,234,000 from RMB 197,862,000[8] - Total assets as of 31 December 2019 were RMB 981.4 million, down from RMB 1,167.9 million in 2018[15] - Total liabilities decreased to RMB 95.8 million in 2019 from RMB 217.3 million in 2018[15] - Non-current assets decreased to RMB 526,472,000 from RMB 549,520,000 in 2018, reflecting a reduction in long-term investments[8] - The equity attributable to equity shareholders decreased to RMB 885,633,000 from RMB 950,548,000 in 2018, indicating a decline in shareholder equity[8] Revenue Breakdown - The manufacturing and sales of wooden products generated revenue of approximately RMB 687.1 million, an increase of 11.0% from RMB 618.9 million in 2018, accounting for 99.0% of total revenue[29][30][33] - Revenue from the renewable energy products segment decreased by 52.7% to approximately RMB 6.9 million, down from RMB 14.6 million in 2018, with profit dropping to RMB 0.9 million from RMB 2.5 million[29][36] - Revenue from North America grew by 28.6% to RMB334.4 million, accounting for 48% of total revenue, up from 41% in 2018[40][41] - Revenue from the PRC market fell by 23.6% to RMB111.6 million, representing 16% of total revenue, down from 23% in 2018[43][45] - Overall revenue from leisure household products surged by 36.9% to RMB72.1 million, with outdoor and indoor furniture increasing by 90.7%[49][53] Market Challenges - The increase in trade tariffs imposed by the United States from 10% to 25% effective May 2019 further declined the profit margin of wooden products exported to the U.S.[19] - The North American market remains the largest income stream for the Group, but trade tensions have adversely impacted performance[19] - The Group anticipates that external factors, including the COVID-19 outbreak and economic slowdowns, will negatively impact profitability in the first half of 2020[25] Corporate Governance - The company has complied with all applicable corporate governance code provisions throughout the year, except for certain disclosed deviations[109] - The Board of Directors is responsible for major decisions, including overall strategies and annual budgets, and is expected to meet at least four times a year[111][122] - The Board consists of two executive directors and four non-executive directors, with three of the non-executive directors being independent[125] - The company is committed to maintaining high standards of corporate governance to enhance transparency and accountability to shareholders[108] Employee and Remuneration - Total employee remuneration expenses for the year were RMB35.3 million, representing 5.1% of the Group's revenue[95] - The Group employed 464 full-time employees as of December 31, 2019, an increase from 426 in 2018[95] - The remuneration for executive Directors and senior management is determined based on performance, professional experience, and prevailing market practices[147] Risk Management - The Risk Management Committee, comprising all independent non-executive Directors, is responsible for reviewing the Group's risk management framework and material risk exposures[196][198] - The Directors acknowledge their responsibility for preparing financial statements that present a true and fair view in accordance with International Financial Reporting Standards[200] COVID-19 Impact - The outbreak of COVID-19 in January 2020 may impact the Group's financial results, although the extent cannot be estimated at this time[104] - The Group will take proactive measures to minimize the impact of COVID-19 on its financial position and operating results[104] - The ongoing COVID-19 pandemic may further affect the company's financial performance, although the extent of this impact is currently unquantifiable[106]

Financial Performance - The Group achieved a revenue growth of 13.3% to RMB 384.0 million compared to RMB 314.0 million in the same period last year[12]. - The gross profit decreased significantly to RMB 13.3 million, resulting in a gross profit margin of 3.5%, down from 17.4% in the previous year[12]. - The Group recorded a net loss of RMB 14.7 million, compared to a profit of RMB 10.5 million in the same period last year, leading to a net profit margin of -4.0%[12]. - The overall revenue from all business segments amounted to approximately RMB 384.0 million, a 22.3% increase from RMB 313.9 million in the previous year[29]. - The Group recorded a loss of approximately RMB 14.7 million for the period, compared to a profit of RMB 10.5 million in H1 2018[52]. - Loss for the period was RMB 14,673,000, a significant decline from a profit of RMB 10,518,000 in the same period of 2018[131]. - Total comprehensive loss for the period was RMB 16,318,000, compared to a total comprehensive income of RMB 10,311,000 in the previous year[131]. Revenue Breakdown - Revenue from the manufacturing and sales of wooden products increased by 25.2% to RMB 380.4 million, contributing 99.0% of the total revenue[21]. - Revenue from timber houses and related parts was RMB 317.4 million, a significant increase from RMB 230.7 million in the previous year[12]. - Revenue from the renewable energy segment decreased by 63.7% to approximately RMB 3.4 million, with profit down to RMB 0.45 million[24]. - The retail business segment generated revenue of RMB 0.22 million, a decrease of 73.4% compared to RMB 0.82 million in the previous year[18]. - Revenue from the PRC market fell by 28.8% to RMB 57.1 million, accounting for 15% of total revenue[29]. - North America accounted for 55% of the total revenue, with revenue growing by 60.6% to RMB 212.6 million[29]. - Revenue from the China market decreased by 63.9% to RMB 29.0 million, representing 15% of total revenue, down from 26% in H1 2018[31]. - Australasia market maintained its position as the second largest income stream, contributing 23% of total revenue, with a 21.0% growth to RMB 89.0 million[33]. Asset Management - Non-current assets stood at RMB 546.9 million, while current assets decreased to RMB 513.3 million[12]. - The current ratio improved to 4.9:1 from 3.1:1, indicating better short-term financial health[12]. - Inventory turnover days decreased to 165 days from 218 days, reflecting improved inventory management[12]. - Trade receivables turnover days improved to 54 days from 65 days, indicating faster collection of receivables[12]. - Current assets decreased to RMB 513,272,000 from RMB 618,361,000 at the end of 2018, reflecting a decline of 18.0%[133]. - Total equity as of June 30, 2019, was RMB 934,230,000, down from RMB 950,548,000 at the end of 2018[134]. Operational Challenges - The Group's operating results were impacted by intensified trade conflicts, affecting overall profitability[15]. - The US-China trade dispute has negatively impacted the gross profit margin of the Group's products exported to the United States[22]. - The trade dispute between the US and China has created significant uncertainty and adverse impacts on the Group's business prospects, particularly affecting profit margins on products exported to the US[72]. - The Group plans to enhance product competitiveness and monitor market trends closely due to expected adverse effects on profitability[29]. Cost Management - Administrative expenses decreased to RMB 22.5 million, down from RMB 25.3 million in H1 2018, due to tightened cost control[49]. - The Group's financing costs decreased to approximately RMB 2.0 million during the period, down from RMB 3.8 million in the first half of 2018[56]. Capital Expenditure and Financing - Capital expenditure for property, plant, and equipment during the period was RMB 10.8 million, an increase from RMB 4.3 million in the first half of 2018[61]. - The total bank financing available to the Group was RMB 226.4 million as of June 30, 2019, compared to RMB 237.2 million at the end of 2018[59]. - The Group had no significant capital commitments or contingent liabilities as of June 30, 2019[62]. Shareholding and Corporate Governance - As of June 30, 2019, Mr. Wu Zheyan holds 449,647,412 shares, representing a 14.56% interest in the company[94]. - The Company has complied with the principles set out in the Corporate Governance Code, except for code provision C.1.2[115]. - The Board has resolved not to declare any interim dividend for the Period[114]. Accounting Policies and Standards - The company has maintained its accounting policies consistent with those adopted in the 2018 annual financial statements, with expected changes to be reflected in the 2019 annual financial statements[142]. - The group adopted IFRS 16, which requires all leases to be capitalized, excluding short-term leases and low-value asset leases[162]. - The initial application of IFRS 16 was effective from January 1, 2019, with the cumulative effect recognized as an adjustment to the opening balance of equity[155]. - The auditor's report on the financial statements was unqualified, indicating no significant issues were raised[148].

Financial Performance - Revenue for 2018 reached RMB 634,686,000, a 37.2% increase from RMB 462,191,000 in 2017[10] - Gross profit for 2018 was RMB 68,525,000, with a gross profit margin of 10.8%, up from 7.0% in 2017[10] - The net loss for 2018 was RMB 184,931,000, resulting in a net profit margin of -29.1%, compared to -8.8% in 2017[10] - The loss attributable to shareholders increased to RMB 185 million in 2018, up from RMB 40.6 million in 2017, primarily due to weakened profitability from exports and asset impairment[18] - The Group recorded a net loss of RMB 184.9 million for the year, compared to a loss of RMB 40.6 million in 2017, reflecting a significant increase in losses[66] Asset Management - Non-current assets decreased to RMB 549,520,000 in 2018 from RMB 772,335,000 in 2017[10] - Current assets also declined to RMB 618,361,000 in 2018 from RMB 721,148,000 in 2017[10] - Total assets decreased to RMB 1,167,881 thousand in 2018 from RMB 1,493,483 thousand in 2017, while total liabilities decreased to RMB 217,333 thousand from RMB 362,893 thousand[16] - The Group recognizes the need for asset impairment of production facilities and lease prepayments due to ongoing trade tensions affecting profitability[36] Financial Ratios - The current ratio improved to 3.1:1 in 2018 from 2.2:1 in 2017, indicating better short-term financial health[10] - Total borrowings to total assets ratio decreased to 9.3% in 2018 from 16.7% in 2017, indicating reduced leverage[10] - The ratio of total borrowings to total assets was 9.3%, down from 16.7% in 2017, while the current ratio improved to 3.1:1 from 2.2:1[75] Revenue Breakdown - The manufacturing and sales of wooden products generated revenue of approximately RMB618.9 million, an increase of 41.7% from RMB436.8 million in 2017, accounting for 97.5% of total revenue[31] - Revenue from renewable energy products decreased by 27.5% to approximately RMB14.6 million, with profit declining by 29.1% to approximately RMB2.5 million, primarily due to intense domestic competition[38] - Revenue from the North American market grew by 10.1% to RMB260.1 million, accounting for 41% of total revenue (2017: 51%)[44] - Revenue from the PRC market increased by 36.1% to RMB146.1 million, representing 23% of total revenue, driven by growth in timber trading[43] - Australasia market revenue surged by 125.5% to RMB187.9 million, now accounting for 29% of total revenue (2017: 18%)[46] Market Challenges - The US-China trade dispute led to a 10% tariff on 5,745 types of imported goods, significantly impacting the Group's export business to the US[19] - The Group anticipates continued challenges in 2019 due to uncertainties from the US-China trade war and economic conditions in overseas markets[24] - The group anticipates continued challenges in the operating environment for 2019, influenced by the US-China trade dispute and other global economic uncertainties[27] Operational Strategies - The company plans to focus on expanding its renewable energy product line and enhancing its market presence[10] - New product development initiatives are underway to improve the range of leisure household products and timber-related offerings[10] - The retail business aims to improve operations through better cost controls and potential realignment of business direction[40] Employee Management - The Group employed a total of 426 full-time employees as of December 31, 2018, down from 510 in 2017[99] - Total employee compensation expenses for the year amounted to RMB 35.5 million, up from RMB 32.6 million in 2017, representing 5.6% of the group's revenue compared to 7.1% in 2017[102] - The company has maintained a competitive compensation package for employees, including discretionary bonuses and social insurance contributions[102] Corporate Governance - The board of directors consists of two executive directors and four non-executive directors, with three non-executive directors being independent[122] - The company has complied with all applicable code provisions in the Corporate Governance Code throughout the year, except for certain disclosed deviations[106] - The Audit Committee is responsible for overseeing financial reporting, risk management, and internal control systems, and is composed of independent non-executive Directors[154][158] Risk Management - The Risk Management Committee is composed entirely of independent non-executive directors, focusing on risk management and oversight of the company's risk policies and standards[192] - The committee reviews the group's major risk exposures, including market, credit, operational, and liquidity risks, ensuring compliance with risk measurement methodologies[194] - The company acknowledges its responsibility for preparing financial statements that present a true and fair view in accordance with International Financial Reporting Standards[196]