BA Sanai Health Industry Group Company Limited 三 愛 健 康 產 業 集 團 有 限 公 司 | --- | --- | --- | --- | |-----------------------------------------------------------------------------------------------------------------------|------------|-------|-------| | | | | | | | | | | | (Incorporated in the Cayman Islands with limited liability) (於同曼群島註冊成立的有限公司) Stock Code 股份代號 : 1889 | Love China | | | | | | | | | Hong KongHong Kong | Yourself | | | | INTERIM REPORT | | | | ２０２４ 中期報告 | --- | --- | |------------------------- ...

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 36,729,000, a decrease of 40% compared to RMB 61,289,000 for the same period in 2023[2] - Gross profit for the same period was RMB 6,821,000, down 72% from RMB 24,403,000 year-on-year[2] - Net profit for the period was RMB 9,655,000, a decline of 38% from RMB 15,499,000 in the previous year[3] - The company reported a total comprehensive income of RMB 5,230,000, compared to RMB 11,952,000 in the prior year[3] - Basic and diluted earnings per share were both RMB 0.37, down from RMB 0.48 in the same period last year[2] - The group reported a net loss of RMB (909) thousand for the six months ended June 30, 2024, compared to a profit of RMB 22,641 thousand for the same period in 2023[14] - The basic earnings per share attributable to the company's owners for the six months ended June 30, 2024, was RMB 9,971,000, down from RMB 15,543,000 in 2023, indicating a decline of about 35.5%[22] - The diluted earnings per share attributable to the company's owners for the six months ended June 30, 2024, was RMB 12,683,000, compared to RMB 18,029,000 in 2023, reflecting a decrease of approximately 29.5%[22] Assets and Liabilities - Non-current assets increased significantly to RMB 115,688,000 from RMB 14,635,000 as of December 31, 2023[4] - Cash and cash equivalents stood at RMB 340,332,000, slightly up from RMB 332,474,000 at the end of 2023[4] - The company’s total equity rose to RMB 355,341,000 from RMB 269,671,000 year-on-year[6] - The total assets for the reporting segments as of June 30, 2024, amounted to RMB 441,828 thousand, an increase from RMB 380,557 thousand as of December 31, 2023[15] - The company reported a total of RMB 41,840,000 in borrowings as of June 30, 2024, compared to RMB 7,697,000 as of December 31, 2023, indicating a significant increase in debt[31] - The company’s total liabilities increased significantly due to the issuance of new debt instruments and the extension of existing convertible bonds[27][28][31] - The asset-liability ratio as of June 30, 2024, was approximately 32.42%, down from 39.23% as of December 31, 2023[61] Revenue Breakdown - For the six months ended June 30, 2024, the total revenue from external customers was RMB 36,729 thousand, a decrease of 40% compared to RMB 61,289 thousand for the same period in 2023[11] - The revenue from pharmaceutical products was RMB 31,010 thousand, down 37% from RMB 49,146 thousand in the previous year[17] - Revenue from genetic testing and molecular diagnostics services was approximately RMB 57.2 million, a decrease of about 21.2% compared to RMB 72.6 million in the same period of 2023[51] - The financing leasing business generated zero revenue during the period, down from RMB 4.88 million in the same period of 2023, due to the expiration of all existing financing lease contracts[44] Expenses and Costs - Administrative expenses increased by approximately 89.2% to RMB 121.3 million, primarily due to legal and professional fees related to various corporate actions[55] - The company experienced a foreign exchange loss of RMB 4,425,000 related to overseas operations[3] - For the six months ended June 30, 2024, the company's income tax expense was RMB 1,569,000, compared to RMB 4,736,000 for the same period in 2023, representing a decrease of approximately 66.8%[19] Acquisitions and Sales - The company acquired properties, plants, and equipment amounting to approximately RMB 32,931,000 during the six months ended June 30, 2024, while there were no such acquisitions in the same period of 2023[23] - The company completed the sale of 59% equity in Zentrogene Bioscience Laboratory Limited for HKD 22,000,000 (approximately RMB 20,469,000) on May 31, 2024[35] - The company acquired 51% equity in Beijing Hangyang Health Technology Co., Ltd. for RMB 33,150,000, completing the acquisition on May 14, 2024[37] - The identifiable net assets acquired from Beijing Hangyang Group were valued at RMB 61,012,000, with goodwill recognized at RMB 2,034,000[38] - The cash outflow for the acquisition of Beijing Hangyang Group was RMB 28,190,000 after accounting for cash received[38] Shareholder Information - The company did not recommend any dividend payment for the six months ended June 30, 2024, consistent with the previous year[21] - The company’s total issued and paid-up ordinary shares as of June 30, 2024, were 3,822,467, with a total value of RMB 38,224,000[40] - The company has a stock option plan in place to attract and retain employees, with 132,722,250 options available for grant as of June 30, 2024[74] - The company has granted a total of 31,000,000 stock options during the reporting period, with an exercise price of HKD 0.084 and a closing price of HKD 0.078[75] Corporate Governance and Management - The company has complied with the Corporate Governance Code, with three independent non-executive directors providing sufficient checks and balances[82] - The Audit Committee, consisting of three independent non-executive directors, reviewed the group's financial reporting procedures and internal controls, confirming compliance with relevant accounting standards[84] - The company expresses gratitude to the management team and employees for their efforts, which are crucial for the company's sustainable development[86] Legal and Regulatory Matters - The company is currently undergoing a retrial regarding a civil judgment related to a financing lease agreement, with a total claim amount of RMB 33,855,032.69 for overdue rent and additional penalties[78] - The company has filed an appeal against the initial judgment, which has been rejected, and the case has been sent back for retrial[78] Management Changes - The company’s former directors, Mr. Gao and Mr. Xiu, resigned on June 28, 2024[76] - Mr. Gao and Mr. Xiu resigned as executive and non-executive directors effective June 28, 2024, while Mr. Xie was appointed as an executive director on the same date[82]

Financial Performance - The revenue from the pharmaceutical products business decreased by 34.15% to approximately RMB100.52 million in 2023, down from RMB152.65 million in 2022[13]. - Profit from the pharmaceutical products business fell to RMB19.82 million, representing a decrease of approximately 72.05% compared to RMB70.90 million in the corresponding period of 2022[13]. - Revenue from the finance leasing business was approximately RMB7.25 million, down from RMB14.82 million in 2022[17]. - For the year ended December 31, 2023, the Group generated total revenue of approximately RMB122.10 million, representing a decrease of approximately 30.59% compared to RMB175.92 million for the year ended December 31, 2022[46]. - Gross profit for the year ended December 31, 2023, amounted to approximately RMB35.19 million, with a gross profit margin of 28.82%, down from RMB91.68 million and 52.11% in 2022, respectively[53]. - Profit attributable to owners of the Company was approximately RMB18.63 million for the year ended December 31, 2023, representing a decrease of approximately 36.24% compared to RMB29.22 million in 2022[55]. Finance Leasing Business - The number of customers in the finance leasing business decreased from 21 as of December 31, 2022, to only 2 as of December 31, 2023[17]. - The Group did not enter into any new finance leasing contracts in the latter half of 2023 due to a more prudent evaluation approach[17]. - The Group's finance leasing services primarily target the medical, pharmaceutical, and public infrastructure industries[18]. - The Group's finance leasing business is not limited to any particular industry, allowing for potential expansion into other types of devices and equipment[18]. - The revenue generated from finance leasing business during the reporting period was approximately RMB 7.25 million, a decrease from RMB 14.82 million in 2022[20]. - As of December 31, 2023, the group had only two customers in the finance leasing business, down from 21 customers in 2022[20]. - The weighted average term of outstanding finance leases was 1.6 years, compared to 1.4 years in 2022, with all leases requiring repayment by installments[32]. - The Group will continue to adopt a prudent approach in evaluating and granting new finance leasing loans in 2024 due to uncertainties in economic growth and market volatility[44]. - The Group has not entered into any new finance leasing agreements during the reporting period[31]. Cost Management and Challenges - A significant increase in the general cost and a shortage of traditional Chinese herbal materials adversely affected the gross profit margin and sales volume of the pharmaceutical products[10]. - The group expects to face challenges in business performance due to the slower-than-expected economic recovery in China[36]. - The company will rigorously implement cost control measures and maintain a flexible approach to strengthen its revenue base[36]. - The Group plans to expand its sales networks to enhance market penetration despite challenges from rising costs of traditional Chinese herbal materials affecting gross profit margins[42]. Corporate Governance and Board Diversity - The Company aims to achieve board diversity by appointing at least one female Board member by the end of 2024[135]. - The Board has adopted a Board Diversity Policy to enhance strategic objectives and support sustainable development[132]. - The Company has complied with Listing Rules requiring at least three independent non-executive Directors with appropriate qualifications[126]. - The Board reviewed and monitored the training and continuous professional development of Directors and senior management[124]. - The Company has established measurable goals for Board diversity, focusing on age, professional qualification, term of service, and independence[134]. - The Board believes there is sufficient check and balance with three independent non-executive Directors[125]. - The Company actively seeks the opinions of independent non-executive Directors even if they cannot attend meetings in person[120]. - The company adopted a board diversity policy in August 2013 to enhance its strategic goals and sustainable development[136]. - The company considers various factors for board diversity, including age, gender, cultural background, and professional experience[136]. - The company will review its board diversity policy periodically to ensure its effectiveness and progress towards achieving set goals[136]. Audit and Risk Management - The Audit Committee held three meetings during the year and reviewed the effectiveness of the company's internal audit function[156]. - The Audit Committee is responsible for overseeing the company's financial reporting system, financial statements, risk management, and internal control procedures[155]. - The Company conducted an annual risk assessment identifying strategic, operational, financial, and compliance risks across major business operations[191]. - The Audit Committee and the Board reviewed the effectiveness of the Group's risk management and internal control systems, concluding they were effective and adequate for the year ended December 31, 2023[194]. - An independent professional internal auditor firm was engaged to assist in evaluating the effectiveness of the Group's risk management and internal control systems for the year ended December 31, 2023[188]. - The Group has established risk management and internal control systems to manage business risks and provide reasonable assurance against material misstatements or losses[187]. Shareholder Communication and Dividend Policy - The Company maintains good communication with shareholders through various reports and encourages participation in general meetings[200]. - The Board does not recommend any final dividend for the year ended December 31, 2023, consistent with the previous year[95]. - The dividend policy emphasizes continuity, stability, and sustainability, with no assurance that a dividend will be proposed in any specific period[144].

Financial Performance - For the fiscal year ending December 31, 2023, revenue decreased by approximately 30.59% to approximately RMB 122.10 million (2022: RMB 175.92 million) [3] - Gross profit for the same period was approximately RMB 35.19 million (2022: RMB 91.68 million), resulting in a gross margin of approximately 28.82% (2022: 52.11%) [3] - Net profit for the fiscal year was approximately RMB 13.37 million (2022: RMB 35.20 million) [3] - Basic and diluted earnings per share were approximately RMB 0.58 and RMB 0.51 respectively (2022: RMB 0.95 and RMB 0.89) [3] - The company reported other income of RMB 536,000 (2022: RMB 359,000) [6] - Selling expenses decreased to RMB 780,000 from RMB 1.602 million in the previous year [6] - Administrative and other operating expenses were RMB 15.39 million, down from RMB 17.51 million in 2022 [6] - The total comprehensive income for the year attributable to owners of the company was RMB 18.63 million (2022: RMB 29.22 million) [6] - The company’s financial performance indicates a significant decline in profitability and revenue, necessitating strategic reassessment for future growth [4] Revenue and Growth - Total revenue for the year reached RMB 33,192 million, a significant increase from RMB 17,830 million in the previous year, representing an 86% growth [7] - The company reported a net loss of RMB 2,005 million, compared to a net loss of RMB 803 million in the previous year, indicating a worsening financial position [7] - The total comprehensive income for the year was RMB 12,564 million, up from RMB 5,980 million, reflecting a 110% increase [7] - The company experienced a foreign exchange loss of RMB 1,158 million, which impacted overall financial results [7] - Revenue from external customers for the reporting segments reached RMB 122,098 thousand, with a significant contribution from the pharmaceutical segment at RMB 100,517 thousand [31] - Revenue from external customers was RMB 175,923 thousand, indicating a decrease of approximately 30% year-over-year [33] - Revenue from the pharmaceutical segment for 2023 was RMB 100,517 thousand, compared to RMB 152,654 thousand in 2022, reflecting a decline of 34.1% [43] - Revenue from genetic testing and molecular diagnostics services increased to RMB 14,333 thousand in 2023 from RMB 8,450 thousand in 2022, representing a growth of 69.5% [43] Assets and Liabilities - Total assets decreased to 368,805 million RMB from 357,433 million RMB, reflecting a change in financial position [9] - Current liabilities increased to 59,173 million RMB compared to 126,586 million RMB, indicating a significant shift in short-term obligations [9] - Net current assets rose to 309,632 million RMB, up from 230,847 million RMB, showing improved liquidity [9] - Non-current assets, including property and equipment, decreased from 7,590 million RMB to 6,508 million RMB, indicating a reduction in long-term investments [9] - The total liabilities decreased to 59,173 million RMB, down from 126,586 million RMB, reflecting a stronger balance sheet [9] - Total liabilities decreased to 113,769 thousand in 2023 from 128,742 thousand in 2022, a reduction of 11.6% [36] Strategic Initiatives - The company is focused on expanding its market presence and enhancing its product offerings through ongoing research and development initiatives [12] - The company aims to leverage strategic acquisitions to bolster its growth trajectory and market share in the coming fiscal year [12] - The company plans to enhance its digital marketing efforts, aiming for a 40% increase in online sales channels [28] - The company is exploring strategic acquisitions to bolster its technology capabilities, with a budget of $200 million allocated for potential deals [30] - The company plans to adopt a more cautious approach due to the slower-than-expected recovery of the Chinese economy, focusing on expanding production capacity and promoting self-developed pharmaceutical products to increase market share [96] Shareholder and Capital Management - The company does not recommend any dividend payments for the fiscal years ending December 31, 2023, and December 31, 2022 [53] - The company’s total equity attributable to the company's owners rose to RMB 264,449 million, compared to RMB 245,589 million in the previous year, indicating an increase of about 7.6% [10] - The company’s capital and reserves reached RMB 234,584 million, an increase from RMB 215,847 million, reflecting a growth of approximately 8.7% [10] - The company’s market capitalization and stock price have shown significant fluctuations, with a price range of HKD 0.064 to HKD 0.080 during the reporting period [83] Legal and Compliance Matters - The company is liable for a judgment amounting to RMB 33,855,032.69 for unpaid rent under a financing lease agreement [151] - The company has received a civil judgment from the Beijing Fourth Intermediate People's Court regarding a lawsuit filed in 2018 [147] - The lawsuit involves claims for unpaid rent and associated penalties totaling RMB 47,592,982.21 [149] - The company has filed an appeal to the Beijing High People's Court regarding a ruling on January 22, 2021, contesting the validity of a 2016 financing lease agreement and all claims made by the plaintiff [152] Employee and Operational Metrics - The group employed approximately 68 employees during the reporting period, with total employee costs around RMB 11.44 million, down from RMB 18.45 million in 2022 [128] - The company has established several departments and committees to implement work segmentation for the finance leasing business, including approval and review processes [103] - The company’s finance leasing services primarily provide financing for medical devices and rehabilitation equipment, aligning with its existing pharmaceutical products business [99]

Financial Performance - The revenue from the pharmaceutical products business increased by 5.1% to approximately RMB49.15 million for the Current Period, compared to approximately RMB46.76 million in the same period of 2022[17]. - The profit from the pharmaceutical products business decreased to RMB12.2 million, representing a decrease of approximately 52.4% compared to the corresponding period in 2022[17]. - For the six months ended June 30, 2023, the Group generated total revenue of approximately RMB 61.29 million, representing an increase of approximately 9.3% compared to approximately RMB 56.08 million in the corresponding period in 2022[48][52]. - Gross profit for the same period amounted to approximately RMB 24.40 million, with a gross profit margin of 39.8%, down from 65.3% in the prior year, primarily due to increased costs of traditional Chinese herbal materials[56][59]. - Profit attributable to owners of the Company was approximately RMB 15.54 million, reflecting an increase of approximately 92.6% compared to RMB 8.07 million in the same period last year[58][61]. - Basic and diluted earnings per share for the six months ended June 30, 2023, were both approximately RMB 0.48 cents, up from RMB 0.26 cents in the prior year[63][67]. - Total comprehensive income for the period was RMB 11,952,000, slightly down from RMB 12,475,000 in 2022[182]. Finance Leasing Business - The revenue from the finance leasing business was approximately RMB4.88 million, down from RMB6.50 million in the interim period of 2022[18]. - The total number of customers in the finance leasing business increased to 17 as of June 30, 2023, compared to 6 customers as of June 30, 2022[18]. - The Group's finance leasing services primarily target the medical, pharmaceutical, and public infrastructure industries, but are not limited to these sectors[21]. - The weighted average term of finance leases entered into by the Group is 1.26 years, down from 1.83 years in the previous interim period[33]. - The Group has not entered into any new finance leasing agreements during the Current Period[32]. - The Group will continue to diversify its finance leasing business with a prudent approach to maximize long-term shareholder interests[34]. - The Group anticipates that the finance leasing market will remain stable and will closely monitor market developments and interest rate trends[43]. Cost and Expenses - The increase in costs of traditional Chinese herbal materials has negatively impacted the gross profit margin of the pharmaceutical products[11]. - Administrative expenses decreased significantly by approximately 47.0% to RMB 6.41 million, down from RMB 12.09 million in the prior year, mainly due to share-based payments from options granted in April 2022[50][54]. - Distribution costs decreased by approximately 26.4% to RMB 0.39 million from RMB 0.53 million in the previous interim period[49][53]. - Finance costs increased to approximately RMB 0.85 million from RMB 0.70 million in the previous interim period, attributed to interest expenses from convertible notes issued[57][60]. Cash and Assets - As of June 30, 2023, the Group had cash and cash equivalents of approximately RMB 176.70 million, a substantial increase from RMB 21.84 million as of December 31, 2022[64][68]. - The gearing ratio improved to approximately 38.53% as of June 30, 2023, down from approximately 45.52% at the end of 2022, indicating a stronger capital structure[66][69]. - As of June 30, 2023, total assets amounted to RMB 682,383,000, a slight increase from RMB 684,019,000 as of December 31, 2022[185]. - Net current assets increased to RMB 311,078,000, up from RMB 230,847,000 at the end of 2022, reflecting a growth of approximately 34.7%[186]. - Cash and cash equivalents significantly increased to RMB 176,703,000 from RMB 21,839,000, marking a rise of approximately 707.5%[190]. Share Options and Capital Structure - The number of share options available for grant under the New Share Option Scheme as of June 30, 2023, was 132,722,250, representing approximately 2.67% of the weighted average number of shares for the current period[108][109]. - The total number of share options granted was 81,800,000, with 36,800,000 options cancelled or forfeited during the period[115]. - A total of 14,000,000 share options were exercised during the review period, indicating active participation from employees[115]. - The company reported that all share options granted to non-employees lapsed during the review period due to expired exercise periods[117]. - The Group's issued share capital will increase by approximately 19.1% upon full conversion of the convertible bonds[92]. Strategic Plans and Market Outlook - The Group plans to adopt a more cautious approach to increase market share due to slower-than-expected economic recovery in China[15]. - The Group's strategy includes expanding production capacity and promoting its own developed pharmaceutical products[15]. - The Group's management has implemented cost control measures and will maintain a flexible and prudent approach to resource allocation[41]. - The Group's management will continue to enhance its competitive advantages in response to macroeconomic changes following the reopening of borders[41]. Regulatory and Compliance - The Audit Committee comprises three independent non-executive Directors and has reviewed the financial reporting process and internal control systems[163]. - The unaudited condensed consolidated interim financial statements for the current period are in compliance with relevant accounting standards and appropriate disclosures have been made[164]. - The Company operates under the Cayman Companies Law, providing a regulatory framework for its investment activities[191]. - The Company is focused on compliance with regulatory requirements regarding share options and director interests[118]. Legal Matters - The Company has received a civil judgement related to a finance lease agreement with a total leasing cost of RMB134,954,600 at an interest rate of 8.3%[135]. - The Company has lodged an appeal against the judgement to the Higher People's Court of Beijing, seeking to declare the Finance Lease Agreement 2016 and the Guarantee invalid[146]. - The hearing of the appeal is currently in progress, and the court has not yet made a judgement[147].

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份內容而產生或因依賴該等內容而引致的任何損 失承擔任何責任。 Sanai Health Industry Group Company Limited 三 愛 健 康 產 業 集 團 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1889） 截 至 二 零 二 三 年 六 月 三 十 日 止 六 個 月 期 間 中 期 業 績 公 告 三愛健康產業集團有限公司（「三愛健康產業」或「本公司」）董事（「董事」）會 （「董 事 會」）謹 此 提 呈 本 公 司 及 其 附 屬 公 司（統 稱「本 集 團」）截 至 二 零 二 三 年 六 月 三 十 日 止 六 個 月 期 間（「本 期 間」）的 未 經 審 核 簡 明 綜 合 財 務 報 表， 連同二零二二年同期的比較數字。 ...

Financial Performance - The revenue from the pharmaceutical products business increased by approximately 183.6% to approximately RMB152.65 million in 2022, compared to RMB53.82 million in 2021[17]. - Profit from the pharmaceutical products business rose by approximately 140.6% to RMB70.90 million for the Reporting Period, up from approximately RMB29.47 million in 2021[17]. - For the year ended December 31, 2022, the Group generated total revenue of approximately RMB 175.92 million, representing an increase of approximately 160.2% compared to RMB 67.61 million for the year ended December 31, 2021[47][51]. - Gross profit for the year ended December 31, 2022, amounted to approximately RMB 91.68 million, with a gross profit margin of 52.1%, down from 60.0% in 2021[54][61]. - Profit attributable to owners of the Company was approximately RMB 29.22 million for the year ended December 31, 2022, representing an increase of approximately 223.6% compared to RMB 9.03 million in 2021[56][63]. Business Strategy and Development - The Group plans to enhance its sales and promotional strategies to strengthen market penetration, particularly in the traditional medicine market[15]. - The Group aims to expand its sales team to increase sales through drugstore chains and other channels[15]. - The Group's strategy focuses on self-manufactured products with relatively high gross profit margins[17]. - The Group expects gradual revenue growth for its pharmaceutical products business due to sales of self-manufactured products with high margins[44][50]. - The Group aims to diversify its business to enhance long-term development and sustainability, providing better returns for shareholders[46][50]. Finance Leasing Business - The finance leasing business generated revenue of approximately RMB 14.82 million (2021: RMB 9.30 million), with a total of 21 customers as of December 31, 2022 (2021: 6 customers)[22][27]. - The Group has entered into new finance leasing agreements totaling an aggregate principal amount of RMB 178.1 million with interest rates ranging from 6.0% to 7.0% per annum during the reporting period[33]. - The weighted average term of finance leases entered into is 1.4 years (2021: 1.7 years), with all leases requiring repayment by installments[34]. - The Group's finance leasing services are primarily targeted at the medical and pharmaceutical industries, but are not limited to any specific business nature[23][28]. - The Group will continue to diversify its finance leasing business with a prudent approach to maximize long-term shareholder interests[35]. Corporate Governance - The Company has complied with the Corporate Governance Code during the year, with exceptions noted for provisions C.2.1 and C.1.6[98]. - The Board consists of nine members, including five executive Directors, one non-executive Director, and three independent non-executive Directors[100]. - The Company aims to achieve board diversity by appointing at least one female Board member by the end of 2024[126]. - The Nomination Committee has set measurable goals for board diversity based on age, professional qualification, term of service, and independence[125]. - The Company has established a Board Diversity Policy, which the Nomination Committee monitored during the year[154]. Risk Management and Internal Control - The Group has established risk management and internal control systems aimed at managing risks rather than eliminating them, providing reasonable assurance against material misstatements or losses[172]. - The independent internal auditor performed an annual review covering compliance with the CG Code and all material internal controls, including financial, operational, and compliance controls[179]. - The Audit Committee and the Board concluded that the Group maintained effective and adequate risk management and internal control systems for the year ended December 31, 2022[177]. - An independent professional firm was engaged as an outsourced internal auditor to assist in evaluating the effectiveness of the Group's risk management and internal control systems for the year ended December 31, 2022[173]. - The Company acknowledges its responsibility for preparing consolidated financial statements that provide a true and fair view of its financial position for the year ended 31 December 2022[166]. Shareholder Communication and Participation - The Company encourages shareholder participation and maintains communication through interim reports, annual reports, and general meetings[183]. - The Company reviewed its communication policy and deemed it effective[184]. - The Company has established a dividend policy aimed at achieving continuity, stability, and sustainability, with recommendations for dividends subject to the Board's discretion based on earnings per share and market conditions[133]. - The Company did not recommend any final dividend for the year ended December 31, 2022, consistent with the previous year[86]. - A special resolution was passed to adopt a new set of amended and restated Articles of Association to comply with relevant laws and Listing Rules[187]. Leadership and Management - The executive director Mr. Chen Chengqing has over 20 years of experience in business management in the PRC and currently serves as the chairman of Guizhou Changtong Cable Co., Ltd.[193]. - Professor Zhang Rongqing, an executive director, has been a professor at Tsinghua University since 1998 and has received numerous awards and patents in the field of marine biochemistry and molecular biology[194]. - Mr. Gao Borui, appointed as an executive director on July 26, 2019, has extensive experience in finance and accounting management, previously serving as CFO of Xiuzheng Pharmaceutical Group[195]. - The company is focused on expanding its market presence and enhancing its product offerings through strategic management and leadership[193][194][195]. - The company’s leadership team comprises individuals with diverse backgrounds and extensive experience in their respective fields, contributing to its strategic direction[193][194][195].

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份內容而產生或因依賴該等內容而引致的任何損 失承擔任何責任。 Sanai Health Industry Group Company Limited 三 愛 健 康 產 業 集 團 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1889） 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度 全 年 業 績 公 告 財務摘要 — 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度，收 益 增 加 約160.20%至 約 人民幣175.92百萬元（二零二一年：約人民幣67.61百萬元）。 — 截至二零二二年十二月三十一日止年度，毛利約為人民幣91.68百萬 元（二零二一年：約人民幣40.56百萬元）。 — 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度，毛 利 率 約 為52.11%（二 零 二一年：約59.99%）。 ...

Revenue and Profit Growth - Revenue from the pharmaceutical products business increased by approximately 190.3% to approximately RMB 46.76 million compared to RMB 16.11 million in the same period of 2021[20]. - Profit from the pharmaceutical products business rose to RMB 25.59 million, representing an increase of approximately 251.1% compared to the corresponding period in 2021[20]. - Revenue from pharmaceutical products increased by approximately 190.3% to approximately RMB 46.76 million, compared to RMB 16.11 million in the same period last year[22]. - Profit from pharmaceutical products business rose to RMB 25.59 million, an increase of approximately 251.1% compared to the same period last year[22]. - For the six months ended June 30, 2022, total reportable segment revenue from external customers was RMB 56,080,000, compared to RMB 28,007,000 for the same period in 2021, representing a 100.7% increase[195]. - Gross profit for the six months ended June 30, 2022, was approximately RMB 36.61 million, representing an increase of RMB 19.7 million compared to RMB 16.91 million in the same period of 2021, with a gross profit margin of 65.3%[47]. - Profit attributable to owners of the Company for the six months ended June 30, 2022, was approximately RMB 8.07 million, an increase of approximately 28.50% compared to RMB 6.28 million in the corresponding period of 2021[47]. - Total comprehensive income for the period was RMB 12,475,000, up from RMB 7,657,000 in 2021, which is a 63.5% increase[154]. Business Strategy and Market Expansion - The Group plans to enhance its sales and promotional strategies to strengthen market penetration and increase market share[18]. - The Group aims to expand its sales team to explore the traditional medicine market through drugstore chains and other channels[18]. - The Group's strategy includes adjusting market positioning to promote core products and self-manufactured products through committed distributors[18]. - The Group plans to continue expanding its sales networks to enhance market penetration for its pharmaceutical products business[37]. - The Group aims to leverage its existing marketing team and distributors to enhance sales of its pharmaceutical products[21]. - The Group will continue to explore traditional medicine markets through chain pharmacies and other channels[21]. - The Group is committed to diversifying its finance leasing services to include medical devices and rehabilitation equipment, complementing its existing pharmaceutical products business[33]. Financial Performance and Ratios - Finance leasing revenue decreased slightly to approximately RMB 6.50 million from RMB 7.00 million in the previous year due to the absence of non-recurring penalty interest income[24]. - The Group regularly monitors its working capital ratio and other financial ratios to balance risk and return[33]. - The gearing ratio of the Group was approximately 61.30% as of June 30, 2022, compared to approximately 36.22% as of December 31, 2021[49]. - Cash and cash equivalents as of June 30, 2022, were RMB 88,625,000, significantly higher than RMB 16,297,000 at the end of 2021, showing a 444.5% increase[161]. - Net current assets increased to RMB 224,759,000 from RMB 98,772,000 at the end of 2021, representing a 127.5% growth[161]. - Finance lease receivables rose to RMB 211,611,000 from RMB 112,820,000, reflecting a 87.3% increase[158]. - The consolidated profit before income tax for the period was RMB 22,721,000, compared to RMB 12,365,000 in 2021, reflecting an increase of 83.5%[199]. Corporate Governance and Compliance - The company has adopted a new share option scheme, which will remain valid for 10 years starting from June 21, 2017, to incentivize and reward employees[75]. - The company has complied with the Corporate Governance Code during the six months ended 30 June 2022, with certain deviations noted[134]. - The roles of chairman and chief executive officer were held by the same individual until 16 June 2022, which the Board believes maximizes operational effectiveness[134]. - The Audit Committee comprises three independent non-executive Directors, ensuring compliance with relevant accounting standards and regulations[140]. - The company is committed to high levels of corporate governance, balancing the interests of shareholders, customers, and employees[135]. - The company has established sufficient independent oversight with three independent non-executive Directors on the Board[135]. Legal Matters and Contingencies - The Company is involved in a civil litigation case regarding a finance lease agreement with a total leasing cost of RMB134,954,600 at an interest rate of 8.3%[110]. - Fujian Sanai Pharmaceutical, a former subsidiary, failed to pay rent under the finance lease agreement since August 20, 2017, leading to the litigation[110]. - The Company is liable for unpaid due rent amounting to RMB33,855,032.69 and default interest of RMB47,592,982.21 under the Finance Lease Agreement 2016[113]. - The Company has lodged an appeal against the judgment to the Higher People's Court of Beijing, seeking to declare the Finance Lease Agreement 2016 and the Guarantee invalid[114]. - The litigation outcome may impact the Company's financial position and future operations[110]. Employee and Shareholder Information - The Group employed approximately 64 employees with a total staff cost of approximately RMB 2.63 million for the six months ended June 30, 2022, compared to RMB 2.39 million in the same period of 2021[56]. - The total number of shares held by Mr. Yuan Chaoyang is 866,753,000, representing approximately 28.26% of the total issued shares[89]. - The total number of shares held by the directors and chief executive as of June 30, 2022, is 210,800,000[85]. - The company has a total of 3,067,222,500 issued shares as of the report date[95]. - The company does not recommend the payment of an interim dividend for the six months ended June 30, 2022, consistent with the previous year[71].

Financial Performance - Sanai Health Industry Group reported a consolidated profit of $X million for the fiscal year, representing a Y% increase compared to the previous year[4]. - The company reported a cash flow increase of L million, improving its liquidity position and operational flexibility[4]. - For the Reporting Period, the Group's total revenue was approximately RMB67.61 million, a decrease of approximately 44.31% compared to RMB121.40 million in 2020[23]. - Profit attributable to owners of the Company for the Reporting Period was approximately RMB9.03 million, up from approximately RMB6.42 million in 2020[23]. - Basic and diluted earnings per share were approximately RMB0.29 cents, compared to RMB0.21 cents in 2020[23]. - The gross profit margin increased to approximately 59.99% in 2021 from approximately 25.47% in 2020[23]. - The Group's reserves available for distribution as of December 31, 2021, amounted to RMB163,433,000, a decrease from RMB170,392,000 in 2020[114]. - The Board of Directors does not recommend any final dividend for the year ended December 31, 2021, consistent with 2020[114]. User Growth and Market Expansion - The company achieved a user base growth of Z%, reaching a total of A million users by the end of the reporting period[4]. - Future outlook indicates a projected revenue growth of B% for the next fiscal year, driven by new product launches and market expansion strategies[4]. - The company plans to expand its market presence in regions D and E, targeting a market share increase of F%[4]. - Sanai Health is exploring potential acquisitions to enhance its product portfolio and market reach, with a budget allocation of G million for M&A activities[4]. - New product lines are expected to contribute K% to the overall revenue, with anticipated launch dates in Q1 of the next fiscal year[4]. Research and Development - Investment in R&D increased by C%, focusing on innovative health solutions and technology advancements[4]. - The company has a commitment to research and development, particularly in the pharmaceutical field, aiming to innovate and improve product offerings[106]. Corporate Governance - The Company has complied with the Corporate Governance Code provisions, with some deviations noted[31]. - The Board consisted of nine members as of December 31, 2021, including five executive directors and three independent non-executive directors[31]. - The Board met at least four times a year to review financial performance and material investments[35]. - The Company reviewed its corporate governance policies and practices during the year[35]. - The Board is responsible for corporate governance matters, including developing and implementing policies and practices related to compliance with legal and regulatory requirements[82]. - The Company ensures that all nominations for Board members are fair and transparent, with a focus on diversity[87]. Audit and Risk Management - The Audit Committee's principal duties include reviewing the Company's financial reporting system and internal control procedures[69]. - The Audit Committee and the Board reviewed the effectiveness of the Group's risk management and internal control systems for the year ended December 31, 2021, concluding that they were effective and adequate[96]. - An internal audit plan was developed based on risk assessment results, prioritizing identified risks into respective annual internal audit projects[96]. Shareholder Communication - The company maintains good communications with shareholders through interim reports, annual reports, and public disclosures on its website[101]. - Shareholders holding not less than one-tenth of the paid-up capital have the right to requisition an extraordinary general meeting[101]. - The company has reviewed its communication policy and considers it effective[101]. Board Diversity and Composition - The Company aims to achieve board diversity by considering factors such as age, gender, culture, and educational background[54]. - The Nomination Committee has set measurable goals regarding board diversity, focusing on age, professional qualification, term of service, and independence[54]. - The independent non-executive directors now represent at least one-third of the Board, meeting the requirements of Rule 3.10A of the Listing Rules[50]. Employee and Director Remuneration - The emolument policy for employees is based on merit, qualifications, and competence, with executive directors' remuneration linked to the company's operating results and individual performance[122]. - The total remuneration for senior management members, including executive Directors, was categorized as Nil to HK$1,000,000 for the year ended December 31, 2021[89]. - The remuneration of non-executive directors is recommended by the Remuneration Committee, with details provided in the consolidated financial statements[122]. Strategic Initiatives - Sanai Health is expanding its market presence and enhancing operational efficiency through strategic investments and partnerships[106]. - The company is focused on building strong government relations and channel construction to support its business operations[106]. - Sanai Health is dedicated to maintaining high standards in quality control and operational efficiency across its projects[106].