Financial Performance - The Group's revenue decreased by approximately 31.1% from approximately RMB184.3 million for the six months ended June 30, 2021, to approximately RMB127.1 million for the Interim Period[8]. - The Group recorded a net loss of approximately RMB2.9 million for the Interim Period, compared to a net profit of approximately RMB7.4 million for the same period in 2021[8]. - Revenue for the six months ended June 30, 2022, was approximately RMB127.1 million, a decrease of 31.1% from RMB184.3 million in the same period of 2021[17]. - The Group incurred an operating loss of RMB 2,467,000 for the six months ended June 30, 2022, compared to an operating profit of RMB 9,748,000 in 2021[82]. - The net loss for the period was RMB 2,873,000, a significant decline from a profit of RMB 7,405,000 in the previous year[82]. - Basic and diluted loss per share attributable to equity holders of the Company was RMB (1.55) cents, compared to earnings of RMB 2.64 cents per share in 2021[82]. - Total comprehensive loss for the period amounted to RMB 1,246,000, down from a comprehensive income of RMB 8,159,000 in the previous year[86]. - The loss attributable to equity holders of the Company for the six months ended June 30, 2022, was RMB (3,885,000), compared to a profit of RMB 6,602,000 in 2021, indicating a significant decline in performance[200]. Revenue Breakdown - Revenue from PCBAs for telecommunication devices decreased by approximately 26.7% to RMB69.0 million, primarily due to weak demand in the smartphone market[19]. - Revenue from PCBAs for IoT products decreased by approximately 47.2% to RMB41.9 million, mainly due to reduced orders from a major customer affected by COVID-19 lockdowns in Shanghai[20]. - Revenue from PCBAs for automotive related devices increased by approximately 270.5% to RMB12.2 million, driven by increased orders as production technology matured[21]. - Other revenue decreased from approximately RMB7.6 million in 2021 to approximately RMB4.0 million in the Interim Period, attributed to reduced orders from industrial use device customers[22]. - The Group's revenue from the People's Republic of China (PRC) for the six months ended June 30, 2022, was RMB 127,070,000, a decrease of 30.8% from RMB 183,970,000 in the same period of 2021[182]. - The Group's revenue from the United States was minimal at RMB 13,000 for the six months ended June 30, 2022, compared to RMB 372,000 in 2021, indicating a significant decline[182]. Cost and Profitability - Gross profit for the Interim Period was approximately RMB14.0 million, representing a decrease of approximately 51.0% from RMB28.6 million in the corresponding period of 2021[25]. - Overall gross profit margin decreased from 15.5% in 2021 to 11.0% in the Interim Period[25]. - Gross profit for PCBAs for telecommunication devices decreased by approximately 47.5% to RMB9.6 million, with a gross profit margin of 13.9%[27]. - Gross profit for PCBAs for IoT products decreased by approximately 81.1% to RMB1.6 million, with a gross profit margin of 3.8%[28]. - The gross profit for PCBAs for automotive related devices increased by approximately 310.5% to approximately RMB2.3 million for the Interim Period, with a gross profit margin of approximately 18.6%[31]. Expenses and Financial Management - Selling and distribution expenses decreased by approximately 31.0% to approximately RMB1.3 million for the Interim Period, maintaining a low expense ratio of approximately 1.1% against revenue[37]. - Administrative expenses decreased to approximately RMB17.6 million for the Interim Period, down from approximately RMB19.6 million due to reduced bonuses[38]. - The net finance income for the Group was approximately RMB0.8 million for the Interim Period, an increase from net finance costs of approximately RMB0.1 million in the previous year[39]. - Income tax expense decreased by approximately RMB1.0 million to approximately RMB1.2 million for the Interim Period, primarily due to decreased assessable profit[41]. Strategic Initiatives - The Group is taking proactive measures to diversify and expand its customer and product base to broaden revenue sources and mitigate business risks[10]. - The economic environment in China and globally remains uncertain and challenging, influenced by macroeconomic headwinds and local epidemics[10]. - The Group plans to maintain cautious spending and expansion strategies to reduce financial risk[10]. - Continued investment in the development of in-house capabilities and keeping abreast of technological advancements is a priority for the Group[10]. - The Group aims to balance the interests of shareholders, employees, and customers while pursuing long-term sustainable development[10]. - The company is focusing on expanding its automotive related device segment, which has shown significant growth in revenue[21]. - The company is focusing on expanding its market presence and enhancing its product offerings as part of its strategic initiatives[126]. Cash Flow and Liquidity - Cash and cash equivalents increased to RMB 90,476,000 as of June 30, 2022, compared to RMB 48,926,000 at the end of 2021, reflecting improved liquidity[89]. - Cash generated from operations for the six months ended June 30, 2022, was RMB 45,308,000, a significant increase from RMB 8,456,000 in the same period of 2021, representing a growth of 434%[131]. - Net cash generated from operating activities reached RMB 47,293,000, compared to RMB 3,827,000 in the prior year, indicating a substantial increase of 1,136%[131]. - Net cash used in investing activities was RMB (1,104,000), a decrease from RMB (39,907,000) in the previous year, showing an improvement of 97%[134]. - Cash and cash equivalents at the end of the period were RMB 90,476,000, up from RMB 78,947,000 in the previous year, marking an increase of 15%[134]. Employee and Remuneration - As of June 30, 2022, the Group had 791 employees with total remuneration of approximately RMB 38.0 million, a decrease from approximately RMB 52.7 million for the same period in 2021[48][52]. - The Group's employee remuneration policy is based on individual performance, work experience, qualifications, and current industry practices[52]. Capital Expenditure and Investments - Capital expenditure for the Interim Period was approximately RMB2.4 million, significantly lower than approximately RMB52.3 million for the same period in 2021[45]. - The Group's capital expenditure primarily focused on the acquisition of facilities and equipment for its factories[50]. - As of June 30, 2022, the Group's capital commitment amounted to approximately RMB 3.2 million, unchanged from December 31, 2021, primarily for acquiring machinery and equipment to enhance production efficiency[65]. Accounting and Compliance - The Group adopted several amended standards and accounting guidelines for the reporting period beginning January 1, 2022, including HKFRS 16 and HKAS 16, which did not have a material impact on the Group's accounting policies[144]. - New and amended standards not yet adopted by the Group include HKFRS 17 for Insurance Contracts, effective January 1, 2023, and amendments to HKAS 1 regarding the classification of liabilities[147]. - The Group is currently assessing the impact of adopting new or amended standards on its future reporting periods and transactions[151]. Financial Risk Management - The Group's financial risk management focuses on minimizing potential adverse effects on financial performance due to market risks, credit risks, and liquidity risks[157].

Financial Performance - The Group's revenue increased by approximately RMB 107.4 million, from RMB 246.5 million in 2020 to RMB 353.9 million in 2021, attributed to the recovery of the Chinese economy post-COVID-19 and the expansion of a new factory in Chongqing City[15]. - The Group's profit for the year decreased by approximately 12.7% to approximately RMB 10.1 million, compared to RMB 11.5 million in 2020[16]. - The impact of COVID-19 in 2020 led to a significant drop in revenue and profit, but the situation improved in 2021 as restrictions eased[14]. - The Group's performance reflects the broader recovery trends in the Chinese economy following the control of the COVID-19 outbreak[15]. - The Group's revenue for the year ended 31 December 2021 was approximately RMB353.9 million, an increase of 43.6% from RMB246.5 million in 2020[28]. - Gross profit for the Group was approximately RMB54.0 million, representing an increase of approximately 7.1% compared to RMB50.4 million in 2020[36]. - The overall gross profit margin decreased from approximately 20.4% in 2020 to approximately 15.3% for the Reporting Period[36]. - Profit for the year decreased by approximately 12.7% from approximately RMB11.5 million in 2020 to approximately RMB10.1 million for the Reporting Period[56]. Revenue Sources - Revenue from PCBAs for telecommunication devices increased by approximately 38.5% to approximately RMB183.5 million for the Reporting Period, driven by new orders from a new factory in Chongqing[30]. - Revenue from PCBAs for IoT products rose by approximately 47.4% to approximately RMB142.3 million, attributed to increased orders from a main customer in line with the rapid development of the IoT industry[32]. - The Group is actively diversifying its customer and product base to broaden revenue sources and mitigate business risks amid the ongoing impact of COVID-19[20]. Operational Challenges - The operating environment remained challenging due to logistics and supply chain bottlenecks, energy crises, and raw material shortages affecting the manufacturing sector[14]. - The Group continues to face challenges related to the delivery of goods in a cost-effective and timely manner due to ongoing supply chain issues[14]. - The Group's operational strategies include enhancing logistics and supply chain management to mitigate ongoing challenges[14]. Cost and Expenses - Selling and distribution expenses amounted to approximately RMB 3.4 million, an increase of approximately 35.9% compared to RMB 2.5 million in 2020[46]. - Administrative expenses increased by approximately 16.8% to approximately RMB42.3 million for the Reporting Period, compared to RMB36.2 million in 2020[51]. - The increase in gross profit for telecommunication devices was primarily due to lower sales prices offered to major customers and increased costs from labor shortages[41]. Assets and Liabilities - Net current assets as of 31 December 2021 were approximately RMB138.2 million, down from approximately RMB153.9 million in 2020[59]. - The current ratio decreased from approximately 3.1 as of 31 December 2020 to 3.0 as of 31 December 2021[59]. - Bank and other borrowings amounted to approximately RMB12.6 million as of 31 December 2021, down from approximately RMB13.9 million in 2020[60]. - The gearing ratio increased to approximately 8.5% as of 31 December 2021, compared to 7.0% as of 31 December 2020[62]. Governance and Management - The company emphasizes high corporate governance standards to enhance performance, transparency, and accountability[141]. - The Company has adopted and complied with the Corporate Governance Code, except for the deviation where the roles of chairman and chief executive officer are not separated, with Mr. Li holding both positions[142]. - The Board comprises five executive Directors, one non-executive Director, and three independent non-executive Directors, with independent Directors representing one third of the Board[156]. - The Company assesses the independence of each independent non-executive Director annually, confirming their independence according to Rule 3.13 of the Listing Rules[154]. - The Company ensures that all Board appointments are based on meritocracy and the contributions candidates can bring[171]. Strategic Initiatives - The Group plans to continue investing in in-house capabilities and keeping abreast of technological advancements to secure more business opportunities[20]. - The company emphasizes the importance of strategic planning and operational management in its growth strategy[121]. - The leadership team includes members with advanced degrees in engineering, science, and business administration[120]. Human Resources - Total employee remuneration for the reporting period was approximately RMB88.8 million, up from RMB62.8 million in 2020, with 891 employees as of December 31, 2021[65]. - The company has a strong emphasis on human resources management to support its growth and operational needs[108]. Committees and Meetings - The Company has established three committees: Audit, Remuneration, and Nomination, to oversee various aspects of its affairs[184]. - The Audit Committee confirmed that the annual report is complete and accurate, complying with the Listing Rules, with no disagreements regarding the selection and appointment of external auditors[194]. - The Remuneration Committee held one meeting during the Reporting Period to review and recommend remuneration policies for Directors and senior management for the years ended December 31, 2020, and December 31, 2021[196].