[Corporate Information](index=3&type=section&id=Corporate%20Information) [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) This section lists the company's executive and independent non-executive directors, along with the composition of its key committees - The Board's executive directors include Chairman Mr Chen Qiyuan and CEO Mr Qi Mingzhi, with independent non-executive directors including Mr Yeung Hok Chi, Ms Yim Ka Man, and Professor Cheung Man Chun (appointed on May 20, 2025)[5](index=5&type=chunk) - The Audit Committee is chaired by Ms Yim Ka Man[5](index=5&type=chunk) [Legal Advisors, Auditor and Registered Office](index=3&type=section&id=Legal%20Advisors%2C%20Auditor%20and%20Registered%20Office) This section provides details on the company's legal advisors, auditor, and various office locations - The company's auditor is PricewaterhouseCoopers[6](index=6&type=chunk) - The company's registered office is in the Cayman Islands, with its headquarters and principal place of business in Shenzhen, China[6](index=6&type=chunk) [Share and Banking Information](index=4&type=section&id=Share%20and%20Banking%20Information) This section outlines the company's share registrars, principal bankers, website, stock code, and listing date - The company's stock code is 1769, and its listing date was June 21, 2019[7](index=7&type=chunk) - Principal bankers include China Merchants Bank Co, Ltd, Industrial Bank Co, Ltd, and Agricultural Bank of China Limited[7](index=7&type=chunk) [Company Profile](index=5&type=section&id=Company%20Profile) [Business and Development Strategy](index=5&type=section&id=Business%20and%20Development%20Strategy) The company is a leading private education provider in Southern China, focusing on diversified growth through new ventures and AI technology - As a leading private education service provider in Southern China, the company offers small-class general education courses and after-school care services[9](index=9&type=chunk) - The group has launched educational tourism and international courses to broaden its revenue base for long-term growth[9](index=9&type=chunk) - The company plans to leverage AI technology to enhance service quality and operational efficiency, driving diversified development[9](index=9&type=chunk) [Financial Highlights](index=6&type=section&id=Financial%20Highlights) [Key Financial Data for Interim 2025](index=6&type=section&id=Key%20Financial%20Data%20for%20Interim%202025) The company's revenue grew, but gross profit and net profit attributable to owners declined in the first half of 2025 Key Financial Metrics | Indicator | H1 2025 (RMB'000) | H1 2024 (RMB'000) | Change (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 439,393 | 399,113 | 40,280 | 10.1% | | Gross Profit | 150,558 | 177,138 | (26,580) | (15.0)% | | Profit for the period attributable to owners of the Company | 62,933 | 82,652 | (19,719) | (23.9)% | | Adjusted profit for the period attributable to owners of the Company | 81,312 | 93,542 | (12,230) | (13.1)% | | Basic earnings per share (RMB cents) | 11.42 | 15.21 | (3.79) | (24.9)% | | Diluted earnings per share (RMB cents) | 11.18 | 14.76 | (3.58) | (24.2)% | | Adjusted basic earnings per share (RMB cents) | 14.75 | 17.21 | (2.46) | (14.3)% | | Adjusted diluted earnings per share (RMB cents) | 14.45 | 16.71 | (2.26) | (13.5)% | - Adjusted profit attributable to owners of the Company is defined as profit adjusted for items not reflecting operational performance, such as share-based compensation expenses[11](index=11&type=chunk)[12](index=12&type=chunk) [Chairman's Statement](index=7&type=section&id=Chairman's%20Statement) [Performance Overview](index=7&type=section&id=Performance%20Overview) The group achieved revenue growth, but profitability was negatively impacted by costs associated with new learning centers - For the six months ended June 30, 2025, the group recorded an **operating profit of RMB77.4 million**[14](index=14&type=chunk) - Revenue **grew by 10.1%** to RMB439.4 million, and tutoring class hours increased from 4,564,252 to 4,944,498[14](index=14&type=chunk) - New learning centers in Guangzhou offered low-priced trial courses, leading to relatively low revenue while costs increased significantly, negatively impacting gross and net profit[15](index=15&type=chunk) - Excluding share-based compensation, **adjusted net profit attributable to owners of the Company was RMB81.3 million**, a decrease of 13.1% year-on-year[16](index=16&type=chunk) [Future Prospects and Development Strategy](index=7&type=section&id=Future%20Prospects%20and%20Development%20Strategy) The group will continue to pursue diversified development, strengthen its "Lexue" brand, and leverage AI to enhance operational efficiency - The group launched educational tourism and international courses in July 2023 to broaden its revenue base[17](index=17&type=chunk) - The company will further strengthen the development of quality education under the "Lexue" brand, covering arts, sports, and various cultural and scientific literacy programs[17](index=17&type=chunk) - Future strategies include promoting comprehensive diversification, actively seeking new business opportunities, and utilizing AI to improve service quality and operational efficiency[18](index=18&type=chunk) [Appreciation](index=8&type=section&id=Appreciation) The Chairman extends gratitude to all stakeholders and reaffirms the commitment to enhancing business development and shareholder returns - The Chairman expresses gratitude to students, parents, management, employees, shareholders, and partners[19](index=19&type=chunk) - The company is committed to strengthening its business development to deliver greater returns to shareholders[19](index=19&type=chunk) [Management Discussion and Analysis](index=9&type=section&id=Management%20Discussion%20and%20Analysis) [Financial Review](index=9&type=section&id=Financial%20Review) This section details the group's financial performance in H1 2025, highlighting revenue growth alongside declining profitability - **Revenue increased by 10.1%** to RMB439.4 million, driven by growth in student enrollments, class hours, and tuition fees[22](index=22&type=chunk) - **Cost of sales rose by 30.1%** to RMB288.8 million, primarily due to increased teacher compensation and amortization of right-of-use assets[23](index=23&type=chunk) - **Gross profit decreased by 15.0%** to RMB150.6 million, with the gross profit margin falling from 44.4% to 34.3%, mainly due to costs from new learning centers[24](index=24&type=chunk) - **Profit for the period attributable to owners of the Company decreased by 23.9%** to RMB62.9 million[33](index=33&type=chunk) [Revenue](index=9&type=section&id=Revenue) Revenue grew by 10.1% in H1 2025, driven by increases in both non-academic and tutorial course segments Revenue by Category | Revenue Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Non-academic quality courses and others | 387,660 | 366,525 | 5.8% | | Tutorial courses | 51,733 | 32,588 | 58.7% | | **Total** | **439,393** | **399,113** | **10.1%** | Key Operating Metrics | Indicator | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Student enrollments | 200,788 | 184,405 | 8.9% | | Tutoring class hours | 4,944,498 | 4,564,252 | 8.3% | - The increase in revenue was primarily due to higher total student enrollments, tutoring class hours, and tuition fees per class hour[22](index=22&type=chunk) [Cost of Sales](index=9&type=section&id=Cost%20of%20Sales) Cost of sales increased significantly by 30.1%, mainly driven by higher teacher compensation and asset amortization from network expansion - **Cost of sales increased by 30.1%** from RMB222.0 million to RMB288.8 million[23](index=23&type=chunk) - The increase was mainly due to higher teacher compensation and amortization of right-of-use assets resulting from an expanded network of learning centers[23](index=23&type=chunk) [Gross Profit and Gross Profit Margin](index=10&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit and margin declined due to the high initial costs and limited revenue from newly opened learning centers - **Gross profit decreased by 15.0%** from RMB177.1 million to RMB150.6 million[24](index=24&type=chunk) - The **gross profit margin fell from 44.4% to 34.3%**[24](index=24&type=chunk) - The decrease was primarily due to limited revenue and significant costs, such as rent and salaries, associated with newly opened learning centers[24](index=24&type=chunk) [Selling Expenses](index=10&type=section&id=Selling%20Expenses) Selling expenses remained stable at RMB6.5 million, primarily related to student activities - Selling expenses increased slightly by 0.2% to RMB6.5 million, mainly related to student activities[25](index=25&type=chunk) [Administrative Expenses](index=10&type=section&id=Administrative%20Expenses) Administrative expenses rose by 14.6% to support the group's business growth - **Administrative expenses increased by 14.6%** from RMB56.2 million to RMB64.4 million[26](index=26&type=chunk) - The increase was mainly due to higher expenses for administrative staff, in line with the group's business growth[26](index=26&type=chunk) [Research and Development Expenses](index=10&type=section&id=Research%20and%20Development%20Expenses) R&D expenses saw a slight decrease, with spending focused on personnel, materials, and course development - **R&D expenses decreased slightly by 2.6%** from RMB10.6 million to RMB10.5 million[27](index=27&type=chunk) - These expenses were primarily for R&D personnel, development of teaching materials and course products, and market research for quality-oriented courses[27](index=27&type=chunk) [Other Income](index=10&type=section&id=Other%20Income) Other income decreased by 13.9% due to lower finance income, partially offset by increased government grants - **Other income decreased by 13.9%** from RMB6.5 million to RMB5.6 million[28](index=28&type=chunk) - The decrease was mainly due to a **RMB2.5 million reduction in finance income**, partially offset by a RMB1.3 million increase in government grants[28](index=28&type=chunk) [Other Gains — Net](index=10&type=section&id=Other%20Gains%20%E2%80%94%20Net) Net other gains decreased by 21.8%, primarily due to losses on asset disposals and reduced lease modifications - **Net other gains decreased by 21.8%** from RMB3.5 million to RMB2.7 million[29](index=29&type=chunk) - The decrease was mainly due to a **net loss on disposal of property, plant and equipment of RMB0.9 million** and a RMB0.7 million reduction in lease modifications[29](index=29&type=chunk) [Finance Costs](index=10&type=section&id=Finance%20Costs) Finance costs decreased by 11.6% as a result of lower interest expenses on lease liabilities - **Finance costs decreased by 11.6%** from RMB4.8 million to RMB4.3 million[30](index=30&type=chunk) - The decrease was primarily due to lower interest expenses on lease liabilities[30](index=30&type=chunk) [Profit Before Income Tax](index=10&type=section&id=Profit%20Before%20Income%20Tax) The group's profit before income tax declined by 33.8% due to the combined effects of rising costs and lower other income - **Profit before income tax decreased by 33.8%** from RMB109.0 million to RMB72.2 million[31](index=31&type=chunk) [Income Tax Expense](index=11&type=section&id=Income%20Tax%20Expense) Income tax expense fell sharply by 65.1% due to a reduction in taxable profit - **Income tax expense decreased by 65.1%** from RMB26.8 million to RMB9.3 million[32](index=32&type=chunk) - The decrease was primarily due to lower taxable profit[32](index=32&type=chunk) [Profit for the period attributable to owners of the Company](index=11&type=section&id=Profit%20for%20the%20period%20attributable%20to%20owners%20of%20the%20Company) Net profit attributable to company owners decreased by 23.9% in H1 2025 - **Profit for the period attributable to owners of the Company decreased by 23.9%** from RMB82.7 million to RMB62.9 million[33](index=33&type=chunk) [Non-IFRS Measures](index=11&type=section&id=Non-IFRS%20Measures) This section presents adjusted profit metrics to provide additional insight into the group's financial performance by excluding non-operational items - The company uses adjusted profit and adjusted earnings per share as additional financial measures to evaluate group performance[34](index=34&type=chunk) - These measures exclude the impact of items management believes do not reflect the group's underlying performance, such as share-based compensation expenses[34](index=34&type=chunk) [Adjusted profit for the period attributable to owners of the Company](index=11&type=section&id=Adjusted%20profit%20for%20the%20period%20attributable%20to%20owners%20of%20the%20Company) Adjusted profit attributable to owners decreased by 13.1% in H1 2025, primarily due to increased share-based compensation expenses Reconciliation of Adjusted Profit | Indicator | H1 2025 (RMB'000) | H1 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company | 62,933 | 82,652 | (23.9)% | | Add: Share-based compensation expenses | 18,379 | 10,890 | 68.8% | | **Adjusted profit for the period attributable to owners of the Company** | **81,312** | **93,542** | **(13.1)%** | - Share-based compensation expenses are non-cash expenditures and are not directly related to the group's operating performance[34](index=34&type=chunk) [Adjusted Earnings Per Share](index=12&type=section&id=Adjusted%20Earnings%20Per%20Share) Adjusted basic and diluted earnings per share both declined compared to the same period last year Adjusted EPS | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Adjusted basic earnings per share (in RMB cents per share) | 14.75 | 17.21 | | Adjusted diluted earnings per share (in RMB cents per share) | 14.45 | 16.71 | - Adjusted basic earnings per share is calculated by dividing the adjusted profit attributable to owners of the Company by the weighted average number of ordinary shares in issue[35](index=35&type=chunk) - Adjusted diluted earnings per share considers the dilutive effect of potential ordinary shares from share options[37](index=37&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=13&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Capital%20Structure) The group's equity increased, but cash reserves decreased while the gearing ratio improved significantly - As of June 30, 2025, the group's **total equity was RMB717.2 million** (December 31, 2024: RMB634.8 million)[40](index=40&type=chunk) - **Cash and cash equivalents decreased by 30.9%** to RMB269.9 million from RMB390.7 million on December 31, 2024, mainly due to property purchases and bank loan repayments[40](index=40&type=chunk) - **Net current assets stood at RMB187.5 million** (December 31, 2024: RMB75.8 million)[40](index=40&type=chunk) - The **gearing ratio improved to 1.7%** as of June 30, 2025, down from 6.3% on December 31, 2024[40](index=40&type=chunk) [Treasury Management Policy](index=14&type=section&id=Treasury%20Management%20Policy) The group invests surplus cash in low-risk, short-term financial products to generate income under a structured management framework - The treasury management policy aims to generate income by investing surplus cash reserves in low-risk financial products[41](index=41&type=chunk) - Investments include low-risk products from trust companies and commercial banks, money market instruments, and debt instruments[41](index=41&type=chunk) - Investment decisions are authorized by the Chairman of the Board, with the treasury department handling execution, monitoring, and monthly cash flow reviews[41](index=41&type=chunk) [Foreign Exchange Risk](index=14&type=section&id=Foreign%20Exchange%20Risk) The group's foreign exchange risk is minimal as most transactions are denominated in RMB, and no hedging policy is currently in place - Most of the group's revenue and expenses are denominated in RMB, and cash balances are held in RMB and HKD[42](index=42&type=chunk) - The group currently does not have a foreign currency hedging policy but will continue to monitor foreign exchange risk[42](index=42&type=chunk) [Material Acquisitions and Disposals and Significant Investments](index=14&type=section&id=Material%20Acquisitions%20and%20Disposals%20and%20Significant%20Investments) No material acquisitions, disposals, or investments were made during the period, but the group remains focused on future growth opportunities - For the six months ended June 30, 2025, the company made no significant investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures[43](index=43&type=chunk) - The group will actively seek investment opportunities to broaden its revenue base and enhance future financial performance[43](index=43&type=chunk) - The Board is confident in the company's future growth prospects[43](index=43&type=chunk) [Dividend](index=15&type=section&id=Dividend) The Board has not recommended the payment of an interim dividend for the period - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[46](index=46&type=chunk) [Contingent Liabilities](index=15&type=section&id=Contingent%20Liabilities) The group had no significant contingent liabilities as of the reporting date - As of June 30, 2025, the group had no material contingent liabilities, guarantees, or pending material litigation or claims[47](index=47&type=chunk) [Pledge of Assets](index=15&type=section&id=Pledge%20of%20Assets) The group had no significant assets pledged as of the reporting date - As of June 30, 2025, and December 31, 2024, the group had no significant pledge of assets[48](index=48&type=chunk) [Employees and Remuneration Policy](index=15&type=section&id=Employees%20and%20Remuneration%20Policy) The group's employee count increased, and its remuneration policy remains market-competitive and performance-based - As of June 30, 2025, the group employed **3,085 employees** (December 31, 2024: 2,973 employees)[49](index=49&type=chunk) - The remuneration policy is aligned with market practices and is determined based on individual performance and experience to ensure competitiveness[49](index=49&type=chunk) [Interim Condensed Consolidated Financial Statements](index=16&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) [Interim Condensed Consolidated Statement of Comprehensive Income](index=16&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) The group's profit for the period was RMB62,823 thousand, with basic earnings per share at 11.42 RMB cents Statement of Comprehensive Income | Indicator | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Revenue | 439,393 | 399,113 | | Cost of sales | (288,835) | (221,975) | | Gross profit | 150,558 | 177,138 | | Operating profit | 77,434 | 113,819 | | Profit before income tax | 72,160 | 109,003 | | Profit for the period | 62,823 | 82,255 | | Profit attributable to owners of the Company | 62,933 | 82,652 | | Basic earnings per share (RMB cents) | 11.42 | 15.21 | | Diluted earnings per share (RMB cents) | 11.18 | 14.76 | [Interim Condensed Consolidated Balance Sheet](index=17&type=section&id=Interim%20Condensed%20Consolidated%20Balance%20Sheet) The group's total assets stood at RMB1,300,355 thousand, with total equity at RMB717,194 thousand as of June 30, 2025 Balance Sheet Summary | Indicator | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | **Assets** | | | | Total non-current assets | 738,019 | 771,384 | | Total current assets | 562,336 | 556,041 | | **Total assets** | **1,300,355** | **1,327,425** | | **Equity** | | | | Capital and reserves attributable to owners of the Company | 717,571 | 635,110 | | Non-controlling interests | (377) | (267) | | **Total equity** | **717,194** | **634,843** | | **Liabilities** | | | | Total non-current liabilities | 208,282 | 212,315 | | Total current liabilities | 374,879 | 480,267 | | **Total liabilities** | **583,161** | **692,582** | | **Total equity and liabilities** | **1,300,355** | **1,327,425** | [Interim Condensed Consolidated Statement of Changes in Equity](index=19&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) Total equity attributable to owners increased, driven by profit for the period and share-based payments Statement of Changes in Equity | Indicator | Balance at Jan 1, 2025 (RMB'000) | Profit for the period (RMB'000) | Purchase of shares for employee share scheme (RMB'000) | Share-based payments (RMB'000) | Balance at June 30, 2025 (RMB'000) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total attributable to owners of the Company | 635,110 | 62,933 | (2,630) | 22,158 | 717,571 | | Non-controlling interests | (267) | (110) | — | — | (377) | | **Total equity** | **634,843** | **62,823** | **(2,630)** | **22,158** | **717,194** | - Profit for the period was **RMB62,933 thousand**, and share-based payments amounted to **RMB22,158 thousand**[57](index=57&type=chunk) - The purchase of shares for the employee share scheme resulted in a decrease of **RMB2,630 thousand**[57](index=57&type=chunk) [Interim Condensed Consolidated Statement of Cash Flows](index=21&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) The group experienced a net decrease in cash due to significant outflows from investing and financing activities Statement of Cash Flows | Cash Flow Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Net cash generated from operating activities | 33,557 | 41,699 | | Net cash used in investing activities | (75,834) | (1,830) | | Net cash used in financing activities | (78,442) | (19,681) | | Net (decrease)/increase in cash and cash equivalents | (120,719) | 20,188 | | Cash and cash equivalents at end of period | 269,938 | 276,163 | - Net cash used in investing activities increased significantly to **RMB(75,834) thousand**, mainly due to payments for property, plant and equipment, land use rights, and intangible assets[60](index=60&type=chunk) - Net cash used in financing activities increased to **RMB(78,442) thousand**, primarily due to repayment of borrowings and lease payments[60](index=60&type=chunk) [Notes to the Interim Financial Information](index=22&type=section&id=Notes%20to%20the%20Interim%20Financial%20Information) [General Information](index=22&type=section&id=General%20Information) The company is an investment holding company incorporated in the Cayman Islands, primarily engaged in private education services in China - Sike Education Group is an investment holding company incorporated in the Cayman Islands, primarily engaged in providing private education services in China[63](index=63&type=chunk) - Mr Chen Qiyuan is the ultimate controlling shareholder of the Company[64](index=64&type=chunk) - The Company's ordinary shares were listed on The Stock Exchange of Hong Kong Limited on June 21, 2019[65](index=65&type=chunk) [Basis of Preparation](index=22&type=section&id=Basis%20of%20Preparation) The interim financial information is prepared in accordance with IAS 34 and should be read with the 2024 annual financial statements - This interim condensed consolidated financial information has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting"[67](index=67&type=chunk) - This information should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024, prepared in accordance with IFRS[67](index=67&type=chunk) - The directors believe the group has sufficient funding for its obligations over the next twelve months, thus adopting the going concern basis[68](index=68&type=chunk) [Accounting Policies](index=23&type=section&id=Accounting%20Policies) The accounting policies applied are consistent with the 2024 annual financial statements, with no material impact from new standards adopted - The accounting policies applied are consistent with those of the annual financial statements for the year 2024, except for the adoption of new and amended standards[69](index=69&type=chunk) - The adoption of new and amended standards and interpretations did not have a significant impact on the interim financial information[71](index=71&type=chunk) - Certain new accounting standards and interpretations have been issued but are not yet effective and are not expected to have a material impact on the group[73](index=73&type=chunk) [Estimates](index=24&type=section&id=Estimates) The preparation of interim financial information requires management to make judgments and estimates, with actual results potentially differing - The preparation of interim financial information requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and reported amounts[74](index=74&type=chunk) - Actual results may differ from these estimates[74](index=74&type=chunk) - The significant judgments made by management in applying the group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the 2024 financial statements[74](index=74&type=chunk) [Financial Risk Management](index=24&type=section&id=Financial%20Risk%20Management) The group manages various financial risks, including market, credit, and liquidity risks, through a comprehensive risk management program - The group's activities are exposed to various financial risks: market risk, credit risk, and liquidity risk[75](index=75&type=chunk) - The group manages liquidity risk by maintaining sufficient cash and bank balances and investing in low-to-medium risk, short-term financial products[77](index=77&type=chunk)[41](index=41&type=chunk) - Fair value estimation is analyzed using a hierarchy of Level 1 (quoted prices), Level 2 (observable inputs), and Level 3 (unobservable inputs)[81](index=81&type=chunk) [Financial risk factors](index=24&type=section&id=Financial%20risk%20factors) The group's activities expose it to market, credit, and liquidity risks, with risk management policies remaining unchanged since year-end 2024 - The group's activities are exposed to market risk (including foreign exchange and interest rate risk), credit risk, and liquidity risk[75](index=75&type=chunk) - The group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects[75](index=75&type=chunk) - There have been no significant changes in the risk management function or any risk management policies since December 31, 2024[76](index=76&type=chunk) [Liquidity risk](index=24&type=section&id=Liquidity%20risk) The group manages liquidity risk by maintaining sufficient cash reserves and banking facilities, with no significant exposure identified - The group manages liquidity risk by holding sufficient cash and bank balances and mitigates it further by maintaining cash reserves and utilizing banking facilities[77](index=77&type=chunk) - The directors believe that the group does not have any significant liquidity risk[77](index=77&type=chunk) Contractual Maturities of Financial Liabilities | Liability Category | Total at June 30, 2025 (RMB'000) | Total at Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Trade payables | 1,632 | 3,723 | | Other payables | 10,668 | 23,117 | | Borrowings | 12,055 | 40,415 | | Lease liabilities | 353,153 | 349,038 | | **Total** | **377,508** | **416,293** | [Fair value estimation](index=26&type=section&id=Fair%20value%20estimation) The group's financial instruments are measured at fair value using a three-level hierarchy, with no changes in valuation techniques during the period - Fair value estimates are categorized into three levels: Level 1 (quoted prices), Level 2 (observable inputs), and Level 3 (unobservable inputs)[81](index=81&type=chunk) Financial Assets at Fair Value | Asset Category | Total at June 30, 2025 (RMB'000) | Total at Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Wealth management products | 113,762 | 96,299 | | Listed equity investments in Mainland China | 4,123 | 5,220 | | Unlisted equity investments in Mainland China | 53,811 | 54,168 | | **Total** | **171,696** | **155,687** | - The valuation of Level 3 instruments, primarily financial assets at FVTPL, is estimated using various valuation methods by referencing quotes from financial institutions and market approaches[84](index=84&type=chunk) [Revenue and Segment Information](index=28&type=section&id=Revenue%20and%20Segment%20Information) The group's revenue is primarily derived from non-academic courses in Guangdong, China, operating as a single private education segment Revenue by Category | Revenue Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Non-academic quality courses and others | 387,660 | 366,525 | | Tutorial courses | 51,733 | 32,588 | | **Total** | **439,393** | **399,113** | - The group's primary market is in Guangdong Province, China, where the majority of its revenue and operating profit are generated[87](index=87&type=chunk) - The group operates and manages its business as a single operating segment of private education services[87](index=87&type=chunk) [Other Income](index=29&type=section&id=Other%20Income) Other income decreased due to lower finance income, which was partially offset by an increase in government grants Other Income Breakdown | Income Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Sub-letting – net | 78 | 166 | | Rental income from operating leases | 1,543 | 1,226 | | Finance income | 2,186 | 4,645 | | Government grants | 1,752 | 419 | | **Total** | **5,559** | **6,456** | - The decrease in other income was mainly due to a **RMB2.5 million reduction in finance income**, partially offset by a RMB1.3 million increase in government grants[28](index=28&type=chunk) [Other Gains — Net](index=29&type=section&id=Other%20Gains%20%E2%80%94%20Net) Net other gains declined, primarily driven by a net loss on the disposal of assets and reduced gains from lease modifications Other Gains Breakdown | Gain Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Fair value gains on financial assets at FVTPL | 3,161 | 3,491 | | Lease modifications | 858 | 1,601 | | (Loss)/gain on disposal of property, plant and equipment, net | (933) | 41 | | Loss on deposits | (832) | (361) | | Fair value loss on investment properties | — | (620) | | **Total** | **2,733** | **3,493** | - The decrease was mainly due to a **net loss on disposal of property, plant and equipment of RMB0.9 million** and a RMB0.7 million reduction in lease modifications[29](index=29&type=chunk) [Expenses by Nature](index=30&type=section&id=Expenses%20by%20Nature) Total expenses increased significantly, with employee benefit expenses and depreciation and amortization being the primary drivers Expenses by Nature | Expense Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Employee benefit expenses | 273,288 | 219,650 | | Depreciation and amortization | 56,639 | 36,153 | | Property management expenses | 8,064 | 6,372 | | Teaching materials | 5,672 | 5,346 | | Advertising and exhibition expenses | 4,719 | 4,247 | | **Total** | **370,251** | **295,243** | - The year-on-year increase in employee benefit expenses reflects the group's business growth and staff expansion[26](index=26&type=chunk)[49](index=49&type=chunk) - Depreciation and amortization expenses increased significantly, mainly due to higher amortization of right-of-use assets from the expansion of the learning center network[23](index=23&type=chunk)[105](index=105&type=chunk) [Finance Costs](index=30&type=section&id=Finance%20Costs) Finance costs decreased due to lower interest expenses on lease liabilities Finance Costs Breakdown | Finance Cost Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Interest expense on borrowings | 400 | 350 | | Interest expense on lease liabilities | 3,855 | 4,466 | | **Total** | **4,255** | **4,816** | - The decrease in finance costs was primarily due to lower interest expenses on lease liabilities[30](index=30&type=chunk) [Income Tax Expense](index=31&type=section&id=Income%20Tax%20Expense) Income tax expense decreased substantially due to lower taxable profit and preferential tax policies Income Tax Breakdown | Income Tax Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Current tax | 16,390 | 28,961 | | Deferred income tax | (7,053) | (2,213) | | **Income tax expense** | **9,337** | **26,748** | - The decrease in income tax expense was mainly due to lower taxable profit[32](index=32&type=chunk) - Shenzhen Fengye qualified as a "High and New Technology Enterprise," enjoying a preferential 15% corporate income tax rate from 2023 to 2025[96](index=96&type=chunk) - Enterprises conducting R&D activities are eligible for a super deduction of 200% on qualified R&D expenses[97](index=97&type=chunk) [Earnings Per Share](index=32&type=section&id=Earnings%20Per%20Share) Both basic and diluted earnings per share decreased compared to the prior year period Earnings Per Share Calculation | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit attributable to owners of the Company (in RMB'000) | 62,933 | 82,652 | | Weighted average number of ordinary shares in issue ('000 shares) | 551,171 | 543,391 | | Basic earnings per share (in RMB cents per share) | 11.42 | 15.21 | | Diluted earnings per share (in RMB cents per share) | 11.18 | 14.76 | - Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of ordinary shares in issue[99](index=99&type=chunk) - Diluted earnings per share is adjusted for the dilutive effect of potential ordinary shares from share options[101](index=101&type=chunk) [Property, Plant and Equipment](index=34&type=section&id=Property%2C%20Plant%20and%20Equipment) The carrying amount of property, plant and equipment decreased slightly due to depreciation and transfers to right-of-use assets PP&E Movement | Indicator | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | At beginning of period | 110,746 | 55,781 | | Additions | 23,581 | 31,745 | | Transfer to right-of-use assets | (12,456) | — | | Depreciation charge | (14,856) | (8,080) | | **At end of period** | **105,992** | **83,471** | [Right-of-use Assets and Leases](index=34&type=section&id=Right-of-use%20Assets%20and%20Leases) The group's right-of-use assets and lease liabilities are primarily related to properties and land use rights Right-of-use Assets and Lease Liabilities | Indicator | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Right-of-use assets | 370,203 | 351,831 | | Lease liabilities | 289,991 | 286,992 | Lease-related Expenses | Expense Category | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | Depreciation charge of right-of-use assets | 41,610 | 27,874 | | Finance cost on leases | 3,855 | 4,466 | - For the six months ended June 30, 2025, the cash outflow for lease financing activities was **RMB47,383 thousand**[106](index=106&type=chunk) [Investment Properties](index=35&type=section&id=Investment%20Properties) The fair value of investment properties remained stable, with valuations based on recent market transactions Investment Property Movement | Indicator | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | At beginning of period | 100,885 | 81,335 | | Additions | — | 29,163 | | Transfer to property, plant and equipment | — | (4,083) | | Transfer to land use rights | — | (11,427) | | Revaluation loss recognised in other gains – net | — | (620) | | **At end of period** | **100,885** | **94,368** | - Investment properties are stated at fair value and measured using significant unobservable inputs (Level 3)[108](index=108&type=chunk) - Investment properties are leased to tenants under operating leases with rentals payable monthly[109](index=109&type=chunk) [Intangible Assets](index=36&type=section&id=Intangible%20Assets) The group's intangible assets primarily consist of goodwill and computer software Intangible Assets Breakdown | Asset Category | Goodwill (RMB'000) | Computer software (RMB'000) | Total (RMB'000) | | :--- | :--- | :--- | :--- | | Net book value at June 30, 2025 | 9,032 | 1,586 | 10,618 | | Net book value at June 30, 2024 | 9,032 | 2,370 | 11,402 | - For the six months ended June 30, 2025, amortization and impairment charges amounted to **RMB174 thousand**[110](index=110&type=chunk) [Prepayments and Other Receivables](index=37&type=section&id=Prepayments%20and%20Other%20Receivables) Prepayments and other receivables include both non-current and current portions, mainly related to property purchases and employee advances Prepayments and Other Receivables Breakdown | Category | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | **Included in non-current assets** | | | | Prepayments for purchase of properties | 37,510 | — | | Rental deposits | 19,652 | 19,328 | | Loans to employees | 1,141 | 3,218 | | **Subtotal** | **62,179** | **28,826** | | **Included in current assets** | | | | Receivables from employees – exercise of share options | 28,835 | 29,752 | | Cash advances to employees | 21,088 | 1,511 | | Other receivables | 4,941 | 5,033 | | **Subtotal** | **69,468** | **51,822** | - Loans to employees are unsecured, interest-free, and mainly for personal property purchases[111](index=111&type=chunk) - Cash advances to employees are primarily made in the normal course of business[111](index=111&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=38&type=section&id=Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) The group's FVTPL financial assets increased, comprising unlisted and listed equity investments and wealth management products FVTPL Financial Assets | Asset Category | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | **Non-current assets** | | | | Unlisted equity investments in Mainland China | 53,811 | 54,168 | | **Current assets** | | | | Listed equity investments in Mainland China | 4,123 | 5,220 | | Wealth management products | 113,762 | 96,299 | | **Total** | **171,696** | **155,687** | Movement of FVTPL Financial Assets | Movement | H1 2025 (RMB'000) | H1 2024 (RMB'000) | | :--- | :--- | :--- | | At beginning of period | 155,687 | 149,420 | | Additions | 19,600 | 634,897 | | Fair value gains | 3,161 | 3,491 | | Disposals | (6,752) | (663,052) | | **At end of period** | **171,696** | **124,756** | - The group holds investments in several funds managed by general partners, participating as a limited partner, which are classified as financial assets at FVTPL[112](index=112&type=chunk) [Bank Balances and Cash](index=39&type=section&id=Bank%20Balances%20and%20Cash) Cash and cash equivalents decreased, with the majority held in RMB and including a small amount of restricted cash Bank Balances and Cash | Indicator | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Cash and bank deposits | 272,240 | 392,379 | | Less: Restricted cash | (2,302) | (1,702) | | **Total** | **269,938** | **390,677** | - The group's cash and bank balances are mainly denominated in RMB and HKD[113](index=113&type=chunk) - As of June 30, 2025, restricted deposits held in banks amounted to **RMB2,302 thousand**[114](index=114&type=chunk) [Share Capital](index=40&type=section&id=Share%20Capital) The company's issued share capital consists of 564,869,050 ordinary shares Share Capital Details | Indicator | Number of authorised ordinary shares | Par value of authorised ordinary shares (USD) | Number of issued ordinary shares | Par value of issued ordinary shares (USD) | | :--- | :--- | :--- | :--- | :--- | | At June 30, 2025 | 1,000,000,000 | 1,000,000 | 564,869,050 | 564,869 | | At Jan 1, 2024 | 1,000,000,000 | 1,000,000 | 555,700,000 | 555,700 | - The par value of issued ordinary shares is equivalent to **RMB3,840,311 thousand**[115](index=115&type=chunk) [Shares Held for Employee Share Scheme](index=40&type=section&id=Shares%20Held%20for%20Employee%20Share%20Scheme) The group holds shares for its employee share scheme, with additional shares acquired during the period Shares Held for Employee Share Scheme | Indicator | At June 30, 2025 (Shares) | At Dec 31, 2024 (Shares) | At June 30, 2025 (RMB'000) | At Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | :--- | :--- | | Shares held for employee share scheme | 12,652,000 | 11,952,000 | 30,938 | 28,308 | - During the six months ended June 30, 2025, the group acquired a total of **700,000 shares** for a total consideration of **RMB2,630 thousand** through its trustee, Kastle Limited[116](index=116&type=chunk) - These shares are held by the trustee for granting share awards under the company's employee share award scheme[116](index=116&type=chunk) [Repurchased Shares](index=41&type=section&id=Repurchased%20Shares) The company holds repurchased shares that have not yet been cancelled, which is expected to enhance earnings per share Repurchased Shares | Indicator | At June 30, 2025 (Shares) | At Dec 31, 2024 (Shares) | At June 30, 2025 (RMB'000) | At Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | :--- | :--- | | Repurchased shares | 1,088,000 | 1,088,000 | 2,366 | 2,366 | - As of June 30, 2025, a total of **1,088,000 shares** repurchased by the company had not yet been cancelled[140](index=140&type=chunk) - The directors believe the repurchase will enhance earnings per share and net assets per share attributable to shareholders[140](index=140&type=chunk) [Share-based Payments](index=41&type=section&id=Share-based%20Payments) This section details the company's share option and share award schemes, including movements and recognized expenses - The Share Option Scheme was terminated on February 27, 2024, but options granted prior to termination remain valid[118](index=118&type=chunk)[147](index=147&type=chunk) - The Share Scheme was adopted on February 27, 2024, to provide long-term incentives to employees[121](index=121&type=chunk) - For the six months ended June 30, 2025, the total share option expense recognized in the consolidated statement of comprehensive income was approximately **RMB22,158 thousand**[125](index=125&type=chunk) [Share Option Scheme](index=41&type=section&id=Share%20Option%20Scheme) The Share Option Scheme was terminated in 2024, but previously granted options remain outstanding and exercisable Share Option Movement | Indicator | At June 30, 2025 (No. of options) | At June 30, 2024 (No. of options) | | :--- | :--- | :--- | | At 1 January | 18,615,950 | 27,785,000 | | At 30 June | 18,615,950 | 27,785,000 | | Vested and exercisable at 30 June | 9,169,050 | 9,169,050 | - The Share Option Scheme was terminated on February 27, 2024, and no further options will be granted under it[147](index=147&type=chunk) - Vested options are exercisable for two years from the vesting date, and all outstanding options will lapse after April 15, 2028[120](index=120&type=chunk) [Share Scheme](index=42&type=section&id=Share%20Scheme) The Share Scheme, adopted in 2024, provides long-term incentives with options valued using a binomial model Share Scheme Movement | Indicator | At June 30, 2025 (No. of options) | | :--- | :--- | | At 1 January | 33,324,000 | | At 30 June | 33,324,000 | | Vested and exercisable at 30 June | 8,335,500 | - The value of options is calculated using the binomial valuation model, with key inputs including share price, exercise price, volatility, expected life, and risk-free rate[123](index=123&type=chunk)[152](index=152&type=chunk)[153](index=153&type=chunk) - As of June 30, 2025, a total of **22,228,000 shares** were available for future grants under the scheme mandate limit[154](index=154&type=chunk) [Share Award Scheme](index=44&type=section&id=Share%20Award%20Scheme) The Share Award Scheme, adopted in 2020, is funded by existing shares, with total recognized expenses of RMB22,158 thousand for the period - The Share Award Scheme was adopted on December 28, 2020, and awarded shares are not funded by new shares[125](index=125&type=chunk) - For the six months ended June 30, 2025, the total share option expense recognized in the consolidated statement of comprehensive income was approximately **RMB22,158 thousand**[125](index=125&type=chunk) [Share Premium and Other Reserves](index=44&type=section&id=Share%20Premium%20and%20Other%20Reserves) Other reserves increased during the period, primarily due to share-based payments Share Premium and Other Reserves | Reserve Note | At June 30, 2025 (RMB'000) | At Jan 1, 2024 (RMB'000) | | :--- | :--- | :--- | | Share premium | 107,941 | 82,698 | | Merger reserve | (46,347) | (46,347) | | Capital reserve | 76,709 | 78,056 | | Share-based compensation reserve | 61,197 | 10,448 | | Revaluation surplus | 378 | 378 | | **Total other reserves** | **91,937** | **42,535** | - Share-based payments led to an increase of **RMB22,158 thousand** in other reserves[126](index=126&type=chunk) [Dividend](index=45&type=section&id=Dividend) The Board has not recommended the payment of an interim dividend for the period - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025[127](index=127&type=chunk) [Contract Liabilities](index=45&type=section&id=Contract%20Liabilities) Contract liabilities, representing deferred revenue from education services, decreased during the period Contract Liabilities | Indicator | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Deferred revenue – education services | 181,941 | 241,092 | - Contract liabilities represent advance consideration received from students for education services, with revenue recognized as services are rendered[128](index=128&type=chunk) [Trade and Other Payables](index=45&type=section&id=Trade%20and%20Other%20Payables) Current trade and other payables decreased, with trade payables primarily related to educational materials Trade and Other Payables | Category | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Trade payables | 1,632 | 3,723 | | Employee benefits payables | 23,685 | 33,773 | | Other tax payables | 12,649 | 13,944 | | Other payables | 10,668 | 23,088 | | **Total** | **48,634** | **74,557** | - Trade payables are mainly related to the purchase of educational books and other teaching aids, with a typical credit period of three months[130](index=130&type=chunk) Ageing Analysis of Trade Payables | Ageing Analysis | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Within 3 months | 895 | 1,077 | | 3 to 6 months | 730 | 2,330 | | 6 months to 1 year | 7 | 316 | | **Total** | **1,632** | **3,723** | [Borrowings](index=46&type=section&id=Borrowings) Bank borrowings decreased significantly and are secured by the group's patents Bank Borrowings | Indicator | June 30, 2025 (RMB'000) | Dec 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Bank borrowings | 12,000 | 40,000 | - The effective interest rates on bank borrowings were **3.35% and 3.4%** for the six months ended June 30, 2025 and 2024, respectively[132](index=132&type=chunk) - As of June 30, 2025, bank borrowings of **RMB12,000,000** were secured by the group's patents[133](index=133&type=chunk) [Corporate Governance and Other Information](index=47&type=section&id=Corporate%20Governance%20and%20Other%20Information) [Compliance with the Corporate Governance Code](index=47&type=section&id=Compliance%20with%20the%20Corporate%20Governance%20Code) The company has complied with all applicable provisions of the Corporate Governance Code during the period - For the six months ended June 30, 2025, the company has complied with all applicable code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules[136](index=136&type=chunk) - The company will continue to review and monitor its corporate governance practices to ensure compliance and maintain high standards[137](index=137&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors](index=47&type=section&id=Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors) All directors and relevant employees have complied with the required standards for securities transactions - The company has adopted the Model Code as set out in Appendix C3 to the Listing Rules to regulate all securities transactions by its directors and relevant employees[138](index=138&type=chunk) - Following specific enquiry, all directors and relevant employees confirmed their compliance with the Model Code during the six months ended June 30, 2025[138](index=138&type=chunk) [Audit Committee](index=47&type=section&id=Audit%20Committee) The Audit Committee, composed of independent directors, has reviewed the group's financial reporting and internal controls - The Audit Committee's primary duties are to review and supervise the group's financial reporting, risk management, and internal control systems, and to review the fairness of connected transactions[139](index=139&type=chunk) - The Audit Committee comprises three independent non-executive directors: Ms Yim Ka Man (Chairlady), Mr Yeung Hok Chi, and Professor Cheung Man Chun[139](index=139&type=chunk) - The Audit Committee has reviewed the group's unaudited interim condensed consolidated financial statements and this interim report[139](index=139&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=47&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) The trustee of the share award scheme purchased company shares, and previously repurchased shares remain uncancelled - Between January 7 and January 17, 2025, the trustee of the group's share award scheme purchased **700,000 shares** for a total consideration of **HK$2,847,000** (equivalent to RMB2,630,000)[140](index=140&type=chunk) - As of June 30, 2025, a total of **1,088,000 shares** repurchased by the company had not yet been cancelled[140](index=140&type=chunk) - The directors believe the repurchase will enhance earnings per share and net assets per share attributable to shareholders[140](index=140&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures](index=48&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) Key executives hold significant interests in the company's shares, with Mr Chen Qiyuan holding a 38.89% stake through a controlled corporation Directors' Interests in Shares | Name | Capacity/Nature of interest | Number of shares | Approximate percentage of shareholding | | :--- | :--- | :--- | :--- | | Mr Chen Qiyuan | Interest of a controlled corporation | 219,658,000 | 38.89% | | Mr Qi Mingzhi | Beneficial owner | 12,818,000 | 2.27% | - Mr Chen Qiyuan is the sole shareholder of Yuxi International and is therefore deemed to be interested in the shares held by Tiansheng through Yuxi International[141](index=141&type=chunk) - Mr Chen Qiyuan beneficially owns 39% of the registered capital of Shenzhen Sike Culture and Education Technology Development Co, Ltd[142](index=142&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares](index=49&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares) Tiansheng and Yuxi International are the substantial shareholders, each holding an approximate 38.89% interest in the company Substantial Shareholders' Interests | Name | Capacity/Nature of interest | Number of shares | Approximate percentage of shareholding | | :--- | :--- | :--- | :--- | | Tiansheng | Beneficial owner | 219,658,000 | 38.89% | | Yuxi International | Interest of a controlled corporation | 219,658,000 | 38.89% | - Tiansheng is owned by Yuxi International, which is wholly owned by Mr Chen Qiyuan, an executive director and controlling shareholder of the Company[143](index=143&type=chunk) [Share Option Scheme](index=49&type=section&id=Share%20Option%20Scheme) The Share Option Scheme was terminated in 2024, but previously granted options remain outstanding and exercisable - The Share Option Scheme was approved and adopted on June 3, 2019, to provide long-term incentives to employees[144](index=144&type=chunk) - The scheme was terminated on February 27, 2024, but any options granted prior to termination remain valid and outstanding[147](index=147&type=chunk) Outstanding Share Options | Category of grantee | Date of grant | Exercise price per share | Outstanding at Jan 1, 2025 (No. of options) | Outstanding at June 30, 2025 (No. of options) | | :--- | :--- | :--- | :--- | :--- | | Employees of the Group | Feb 6, 2023 | HK$1.62 | 18,615,950 | 18,615,950 | - As of June 30, 2025, **9,169,050 share options** were vested and exercisable at an exercise price of HK$1.62 per share[150](index=150&type=chunk) [Share Scheme](index=51&type=section&id=Share%20Scheme) The Share Scheme, adopted in 2024, provides long-term incentives with options valued using a binomial model - The Share Scheme was adopted on February 27, 2024, to provide long-term incentives to employees for long-term shareholder returns[121](index=121&type=chunk)[149](index=149&type=chunk) Outstanding Share Options | Category of grantee | Date of grant | Exercise price per share | Outstanding at Jan 1, 2025 (No. of options) | Outstanding at June 30, 2025 (No. of options) | | :--- | :--- | :--- | :--- | :--- | | Employees of the Group | Feb 28, 2024 | HK$4.48 | 16,671,000 | 16,671,000 | | Employees of the Group | Nov 29, 2024 | HK$5.16 | 16,671,000 | 16,671,000 | - As of June 30, 2025, **8,335,500 options** granted on February 28, 2024, were vested and exercisable[151](index=151&type=chunk) - The value of options is calculated using the binomial valuation model, with key inputs including share price, exercise price, volatility, expected life, and risk-free rate[152](index=152&type=chunk)[153](index=153&type=chunk) [Share Award Scheme](index=53&type=section&id=Share%20Award%20Scheme) The Share Award Scheme is funded by existing shares purchased from the market, with no new awards granted or vested during the period - The Share Award Scheme was approved and adopted by the Board on December 28, 2020, and is funded by existing shares, not new ones[155](index=155&type=chunk) - The trustee has purchased shares in the market and holds **12,652,000 shares** as of the date of this interim report[156](index=156&type=chunk) - No share awards were granted or vested under the Share Award Scheme during the six months ended June 30, 2025[156](index=156&type=chunk) [Structured Contracts](index=53&type=section&id=Structured%20Contracts) The group utilizes structured contracts to control its PRC operating entities due to foreign ownership restrictions in China's education sector - Due to restrictions on the equity structure of the group's business under PRC law, the company uses structured contracts to control its PRC operating entities and derive economic benefits[157](index=157&type=chunk) - Shenzhen Fengye has committed to exercising its equity interest subscription right to acquire the entire equity interest in the PRC operating entities if regulatory restrictions are lifted[158](index=158&type=chunk) - The Foreign Investment Law does not explicitly define contractual arrangements as foreign investment, but future regulations could create uncertainty[160](index=160&type=chunk)[162](index=162&type=chunk) [Background of the Structured Contracts](index=53&type=section&id=Background%20of%20the%20Structured%20Contracts) Structured contracts are used to control PRC operating entities and derive economic benefits due to legal restrictions on foreign ownership - Due to restrictions on the equity structure of the group's business under PRC law, the group cannot convert any PRC operating entity into a Sino-foreign joint venture[157](index=157&type=chunk) - The company uses structured contracts to control the PRC operating entities and derive economic benefits from them[157](index=157&type=chunk) - The structured contracts are designed to achieve the group's business objectives while minimizing potential conflicts with relevant PRC laws and regulations[157](index=157&type=chunk) [Unwinding of the Structured Contracts](index=54&type=section&id=Unwinding%20of%20the%20Structured%20Contracts) The group plans to unwind the structured contracts by acquiring full equity interest if and when PRC regulations permit - Shenzhen Fengye has committed to exercising its equity interest subscription right to acquire the entire equity interest in the PRC operating entities if regulatory restrictions are lifted, thereby unwinding the structured contracts[158](index=158&type=chunk) - As of the date of this interim report, none of the structured contracts had been unwound[158](index=158&type=chunk) [Plan to Comply with the Qualification Requirements](index=54&type=section&id=Plan%20to%20Comply%20with%20the%20Qualification%20Requirements) The group has taken steps to meet qualification requirements, including establishing a presence in Hong Kong, despite current regulatory hurdles in the PRC - It is not yet possible for the relevant education authorities to accept the group's application to convert any PRC operating entity into a Sino-foreign joint venture[159](index=159&type=chunk) - The group is preparing to launch a tutorial center in Hong Kong and has obtained a Certificate of Registration of a School from the Hong Kong Education Bureau[159](index=159&type=chunk) - The company believes the measures taken to comply with the qualification requirements are reasonable and appropriate[159](index=159&type=chunk) [Foreign Investment Law](index=54&type=section&id=Foreign%20Investment%20Law) The Foreign Investment Law does not currently classify contractual arrangements as foreign investment, but future regulations could introduce uncertainty - The Foreign Investment Law, effective January 1, 2020, replaced previous laws but does not explicitly define contractual arrangements as foreign investment[160](index=160&type=chunk) - It is uncertain whether future regulations by the State Council might classify contractual arrangements as a form of foreign investment, which could affect their validity[162](index=162&type=chunk) - There is no guarantee that the structured contracts and the business of the PRC operating entities will not be materially and adversely affected in the future[162](index=162&type=chunk) [Overall Performance and Compliance of the Structured Contracts](index=55&type=section&id=Overall%20Performance%20and%20Compliance%20of%20the%20Structured%20Contracts) The group has ensured effective operation through compliance with the structured contracts, which remain legally enforceable under current PRC law - The group has taken measures to ensure its effective operation through the implementation of and compliance with the structured contracts[163](index=163&type=chunk) - As of the date of this interim report, the company is not aware of any non-performance of the structured contracts or non-compliance with the above measures[163](index=163&type=chunk) - The group's PRC legal counsel has advised that the structured contracts are legally enforceable and do not violate current PRC laws and regulations[163](index=163&type=chunk) [Definitions](index=55&type=section&id=Definitions) [Definitions of Key Terms](index=55&type=section&id=Definitions%20of%20Key%20Terms) This section provides definitions for key terms and abbreviations used throughout the report to ensure consistent understanding - "Board" means the board of Directors[166](index=166&type=chunk) - "Company" refers to Sike Education Group, an exempted company incorporated in the Cayman Islands on February 7, 2018[166](index=166&type=chunk) - "Group" refers to the Company, its subsidiaries, and consolidated affiliated entities[166](index=166&type=chunk) - "Share Option Scheme" refers to the post-IPO share option scheme approved and adopted by the Company on June 3, 2019, and terminated on February 27, 2024[166](index=166&type=chunk) - "Share Scheme" refers to the share scheme adopted by the Company on February 27, 2024[166](index=166&type=chunk)

Summary of Conference Call Records Industry Overview - The service consumption in China is significantly lower than in developed countries, currently at approximately 30% compared to 70% in the US, indicating substantial growth potential [1][2] - The new policies aim to enhance service consumption, particularly in the cultural and tourism sectors, with local governments actively improving service quality [1][2] Key Policy Insights - Five major increments in the new policy include: 1. Optimizing student holiday arrangements to explore spring and autumn breaks, benefiting tourism [1][4] 2. Encouraging IP collaborations to promote cross-industry partnerships [1][4] 3. Linking sports events with cultural tourism to boost consumer engagement [1][4] 4. Promoting AI applications in various sectors such as e-commerce and education [1][4] 5. Regulating non-academic training institutions to encourage market-oriented vocational training [1][4] Impact on Specific Sectors - **Tourism and Hospitality**: - The expansion of the visa-free entry policy is expected to significantly boost inbound tourism, particularly benefiting major cities like Beijing and Shanghai, as well as OTA platforms and hotels [3][9][12] - **Cultural and Sports Events**: - The policy encourages the introduction of international sports events and supports local sports activities, which will benefit event organizers and related industries, enhancing investor expectations [1][6] - **Education and Training**: - The new regulations for non-academic training institutions will favor companies like New Oriental and others in the vocational training sector [7][8] Financial and Economic Support - The government plans to utilize central budget investments and local special bonds to support cultural tourism and elderly care facilities, which will attract social capital investment [13] - Financial tools will be employed to increase credit availability, directly benefiting companies involved in consumer lending, such as Chongqing Department Store [13] Additional Considerations - The adjustment of student holiday schedules is anticipated to increase tourism frequency while alleviating congestion during peak seasons [11][12] - The integration of AI in service sectors is expected to enhance operational efficiency and reduce costs, indicating a significant trend in future consumption development [10]

Core Viewpoint - The company, Thinker Education (01769), has announced the granting of a total of 33.342 million stock options (old stock options) to grantees, which have not yet been exercised, including 8.3355 million vested old stock options and 25.0065 million unvested old stock options [1] Summary by Relevant Sections - The company has decided to cancel the 25.0065 million unvested old stock options and replace them with 22.228 million new stock options (new stock options) to incentivize and retain grantees for the company's development, effective September 11, 2025, subject to the agreement and acceptance of the grantees [1]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不 發表任何聲明，並明確表示概不就因本公告全部或任何部分內容所產生或因依賴該等內容而引致的任何損失 承擔任何責任。 SCHOLAR EDUCATION GROUP 思 考 樂 教 育 集 團 股權（「新購股權」（）「替換」），以替換上述已註銷的舊購股權，惟須獲承授人各自同意及接 納。替換的詳情載列如下： 替換之詳情 （ 在開曼群島註冊成立的有限公司） （股份代號：1769） 替換購股權 本公告乃由思考樂教育集團（「本公司」）根據香港聯合交易所有限公司（「聯交所」）證券上市 規則（「上市規則」）第17.06A條刊發。 茲提述本公司日期為於二零二四年二月二十八日、二零二四年三月五日及二零二四年十一 月二十九日的公告，內容有關於二零二四年二月二十八日及二零二四年十一月二十九日根 據其於二零二四年二月十七日採納的股份計劃（「股份計劃」）向本公司部分員工（「承授人」） 授出購股權（「購股權」）。於本公告日期，合共33,342,000份購股權（「舊購股權」）已授予承授 人，該等購股權均尚未行使，包括8,335,500份已歸屬舊購股 ...

Group 1 - FIL Limited increased its stake in Think Education (01769.HK) by purchasing 950,000 shares at an average price of HKD 2.2589 per share, totaling approximately HKD 2.146 million [1] - Following this transaction, FIL Limited's total shareholding rose to 57.402 million shares, increasing its ownership percentage from 9.99% to 10.16% [1][2]

股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 | | | 致：香港交易及結算所有限公司 公司名稱: 思考樂教育集團 呈交日期: 2025年9月2日 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01769 | 說明 | | | | | | | | | 已發行股份（不包括庫存股份）數目 | | 庫存股份數目 | | 已發行股份總數 | | | 上月底結存 | | | 564,869,050 | | 0 | | 564,869,050 | | 增加 / 減少 (-) | | | 0 | | 0 | | | | 本月底結存 | | | 564,869,050 | | 0 | | 564,869,050 | 第 2 頁 共 10 頁 v 1.1.1 III.已發行股份及/或庫存股份變動詳情 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所 ...

Core Viewpoint - Thinker Education (01769) has seen its stock price drop over 6%, reaching a low of 2.22 HKD, which is a 57.6% decline from its yearly high of 5.23 HKD [1] Financial Performance - For the six months ending June 30, 2025, the company reported revenue of 439 million RMB, representing a year-on-year growth of 10.1% [1] - The profit attributable to the company's owners was 62.93 million RMB, a decrease of 23.9% year-on-year [1] - After excluding share-based compensation expenses, the adjusted net profit attributable to owners was 81 million RMB, down 13.1% year-on-year [1] Margin Analysis - The gross margin for the first half of the year was 34.3%, which is a decline of 10.1 percentage points year-on-year [1] - The decline in gross margin is attributed to the new learning center in Guangzhou being in a ramp-up phase, leading to higher initial costs for rent and salaries, while initial revenues from experiential courses were relatively low [1] Market Dynamics - Revenue growth has slowed compared to 2024, primarily due to challenges in the Shenzhen market [1] - Increased competition in the Shenzhen market, along with personnel changes and management adjustments, have contributed to the slowdown in revenue growth [1]

Core Viewpoint - Thinker Education (01769) has seen its stock price drop over 6%, reaching a low of 2.22 HKD, which is a 57.6% decline from its year-to-date high of 5.23 HKD [1] Financial Performance - For the six months ending June 30, 2025, the company reported revenue of 439 million RMB, representing a year-on-year growth of 10.1% [1] - The profit attributable to the company's owners was 62.93 million RMB, a decrease of 23.9% year-on-year [1] - After excluding share-based compensation expenses, the adjusted net profit attributable to owners was 81 million RMB, down 13.1% year-on-year [1] Margin Analysis - The gross margin for the first half of the year was 34.3%, which is a decline of 10.1 percentage points year-on-year [1] - The decline in gross margin is attributed to the new learning center in Guangzhou being in a ramp-up phase, leading to higher initial costs for rent and salaries, while initial revenues from experiential courses were relatively low [1] Market Dynamics - Revenue growth has slowed compared to 2024, primarily due to challenges in the Shenzhen market [1] - Increased competition in the Shenzhen market, along with personnel changes and management adjustments, have contributed to the slowdown in revenue growth [1]

Group 1 - The company, Thinker Education (01769), announced the purchase of a total of 80,000 shares on the market as part of a trust arrangement for the benefit of selected participants [1]

Group 1 - The company, Thinking Academy Education (01769), announced the purchase of a total of 80,000 shares on the market as part of its share award plan [1] - The shares are held in trust for the benefit of selected participants according to the plan rules and trust deed [1]