Company Information [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) The company's board, comprising executive and independent non-executive directors, ensures robust governance via audit, remuneration, and nomination committees - The Board of Directors includes executive directors Mr. Ng Khing Yeu (Chairman), Ms. Li Xiaolan, Mr. Wang Er, and independent non-executive directors Mr. Dong Jie, Dr. Wang Ling, and Mr. Liang Yaozu[5](index=5&type=chunk) - The company has an Audit Committee (Chairman: Mr. Liang Yaozu), a Remuneration Committee (Chairman: Dr. Wang Ling), and a Nomination Committee (Chairman: Ms. Li Xiaolan), with independent non-executive directors participating in each[5](index=5&type=chunk) [Registration and Business Locations](index=3&type=section&id=Registration%20and%20Business%20Locations) The company is registered in the Cayman Islands with primary business operations in Malaysia and Hong Kong, trading under stock code 02112 - The company's registered office is in the Cayman Islands, with its headquarters and principal place of business in Kuantan, Pahang, Malaysia, and its principal place of business in Hong Kong located in Lai Chi Kok, Kowloon[5](index=5&type=chunk) - The company's stock code is **02112**, and its corporate website is https://www.gracelife.hk[6](index=6&type=chunk) Summary [Summary](index=4&type=section&id=Summary) For H1 2025, the Group saw significant revenue growth, turned profitable, but the Board did not recommend an interim dividend 2025 H1 Key Financial Summary (Million USD) | Metric | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Revenue | 8.42 | 5.97 | | Gross Profit | 1.13 | 0.98 | | Profit/(Loss) | 0.2 (Profit) | (9.0) (Loss) | | Interim Dividend | None | None | Management Discussion and Analysis [Business Development Overview](index=5&type=section&id=Business%20Development%20Overview) As an investment holding company, the Group's core businesses include R&D and application of plant stem cell technology, iron ore exploration, mining, and sales, with mining assets concentrated in Malaysia's Ibam mine - The company's main businesses include R&D and application of plant stem cell technology, iron ore exploration, mining and sales, and investment holding[10](index=10&type=chunk) - For the six months ended June 30, 2025, the Group's primary mining assets were concentrated in the iron ore reserves of the Ibam mine in Pahang, Malaysia[10](index=10&type=chunk) [Continued Rapid Growth and Strategic Upgrades in Plant Stem Cell Business](index=5&type=section&id=Continued%20Rapid%20Growth%20and%20Strategic%20Upgrades%20in%20Plant%20Stem%20Cell%20Business) The plant stem cell business achieved strong growth in H1 2025, becoming a core performance driver through expanded sales channels and market penetration, further solidified by strategic cooperation with a Chinese medical group and future global R&D center plans - In H1 2025, the plant stem cell business maintained **strong growth**, with a significant increase in revenue, becoming the core engine of the company's performance growth[11](index=11&type=chunk) - The company established a strategic partnership with a leading Chinese medical group, leveraging its national healthcare service network to comprehensively promote the sales and marketing of plant stem cell products in the Chinese market[11](index=11&type=chunk) - Future plans include establishing a global R&D center, collaborating with renowned scientific research institutions, deploying **10,000 vending machines** in China, setting up high-end shopping mall counters, and opening **over 50 health management chain centers**[12](index=12&type=chunk) - In May 2025, a non-legally binding Memorandum of Understanding was signed with a Korean plant stem cell essence production facility to explore potential strategic investment[12](index=12&type=chunk) [Adjustments in Mining Business and Exploration of New Ventures](index=6&type=section&id=Adjustments%20in%20Mining%20Business%20and%20Exploration%20of%20New%20Ventures) Due to low international iron ore prices, the company suspended iron ore production and sales in H1 2025, while actively exploring the feasibility of tin concentrate mining to diversify its mining segment - Due to persistently low international iron ore prices, far below mining and processing costs, the company maintained its decision to **suspend iron ore production and sales** in H1 2025[14](index=14&type=chunk) - In February 2025, the company began exploring the feasibility of tin concentrate mining, has contacted potential partners, and is preparing a tin concentrate production line, which is expected to bring new revenue streams[14](index=14&type=chunk) [Continued Advancement of Diversification Strategy](index=6&type=section&id=Continued%20Advancement%20of%20Diversification%20Strategy) The company will continue its diversification strategy, consolidating the plant stem cell business as a core growth engine and prudently advancing the tin concentrate business to navigate market volatility and create long-term sustainable value - The company will fully leverage its plant stem cell advantages, accelerate business expansion in traditional Chinese medicine and the broader health industry chain, and consolidate its core growth engine[15](index=15&type=chunk) - The company will prudently advance the tin concentrate business, flexibly responding to global economic and commodity market fluctuations, ensuring overall business resilience and growth potential[15](index=15&type=chunk) [Market Review and Outlook](index=6&type=section&id=Market%20Review%20and%20Outlook) This report analyzes the current status and trends of the big health industry, health supplement market, iron ore market, and tin concentrate market, highlighting significant growth potential in health and supplements, low iron ore prices, and rising tin concentrate prices due to supply tightening [Big Health Industry](index=6&type=section&id=Big%20Health%20Industry) The "Big Health" industry maintains strong growth driven by policy support and consumption upgrades, with China's output value projected to reach **RMB 16 trillion by 2030** and significant increases in resident healthcare expenditure - The "Healthy China 2030" planning outline prioritizes health as a strategic development, with China's health industry output value expected to reach **RMB 16 trillion by 2030**[18](index=18&type=chunk) - In 2024, national per capita expenditure on medical care and health reached **RMB 2,547**, a **16.0% year-on-year increase**, reflecting stronger public health demand[18](index=18&type=chunk) [Health Supplement Market](index=7&type=section&id=Health%20Supplement%20Market) The global health supplement market continues to expand, with China as a key growth engine, projected to reach **RMB 320.71 billion by 2029**, still showing immense potential for per capita consumption growth Global and China Health Supplement Market Size (Billion CNY) | Market | 2024 Size | 2029 Projected Size | | :--- | :--- | :--- | | Global | 1,376.58 | 1,821.34 | | China | 260.22 | 320.71 | - China's health supplement market compound annual growth rate (2018-2023) was **6.9%**, higher than developed countries, but per capita consumption in 2023 was only **USD 405**, indicating huge future growth potential[19](index=19&type=chunk) [Iron Ore Market](index=8&type=section&id=Iron%20Ore%20Market) In H1 2025, the iron ore market saw an initial rise followed by a decline, influenced by supply tightness, concerns over China's production cuts, and US tariff policies, with average prices falling by approximately **USD 18/ton** compared to the same period last year - In H1 2025, the iron ore market showed an initial rise followed by a decline, with prices high at the beginning of the year due to supply tightness, then falling from March due to concerns over China's production cuts and high port inventories[20](index=20&type=chunk) - The average iron ore price in the first five months of this year was approximately **USD 18/ton lower** than the same period last year, leading some small and medium-sized mines with higher costs to reduce shipments[20](index=20&type=chunk) [Tin Concentrate Market](index=8&type=section&id=Tin%20Concentrate%20Market) China, the world's largest tin ore importer, has increased its reliance on imports due to tightening domestic supply, with significant import declines in 2024 and early 2025 driving up tin concentrate prices - China's reliance on tin ore imports continues to increase; imports fell sharply by **36.2% in 2024** due to a mining ban in Myanmar's Wa State, and further decreased by **over 50% year-on-year in the first two months of 2025**[21](index=21&type=chunk) - Driven by tightening supply, tin concentrate prices rose from **RMB 240,000/ton to a high of RMB 299,000/ton in March**[21](index=21&type=chunk) [Business and Operations Review](index=8&type=section&id=Business%20and%20Operations%20Review) In H1 2025, the Group suspended Ibam mine production due to low iron ore prices, but achieved significant revenue growth in its health supplement business, resulting in a profit for the period, while facing liquidity pressure and multiple legal disputes [Ibam Project Operations Update](index=8&type=section&id=Ibam%20Project%20Operations%20Update) The Ibam mine possesses abundant iron ore resources, but due to international iron ore prices falling significantly below mining costs in H1 2025, the company suspended all iron ore-related production and sales activities - The Ibam mine has mineral resources of approximately **151 million tons**, with an average total iron grade of **46.5%**, and an estimated mining period of **over 26 years**[22](index=22&type=chunk) - In H1 2025, due to international iron ore prices falling to approximately **USD 100 per dry ton**, far below mining and beneficiation costs, the company suspended all iron ore-related production and sales activities, with **zero thousand tons** produced[22](index=22&type=chunk) [Operating Results](index=8&type=section&id=Operating%20Results) The Group's revenue increased to **USD 8.42 million** in H1 2025, primarily due to expanded sales channels and increased customer numbers for health supplements and other products, successfully achieving a profit for the period Operating Results Overview (Thousand USD) | Metric | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Revenue | 8,417 | 5,969 | | Cost of Sales | (7,285) | (4,986) | | Gross Profit | 1,132 | 983 | | Administrative and Other Expenses | (1,080) | (1,239) | | Finance Costs | (9,496) | (8,393) | | Profit (Loss) for the Period | 151 | (8,996) | - Sales revenue from health supplements and other products increased, mainly due to the expansion of plant stem cell sales channels and an increase in customer numbers[24](index=24&type=chunk) - A profit of approximately **USD 0.2 million** was recorded for the period, compared to a loss of approximately **USD 9.0 million** in the previous period, primarily due to the recognition of an interest waiver of approximately **USD 9.9 million** following an interest waiver agreement in April 2025[31](index=31&type=chunk) [Liquidity, Financial Resources, and Capital Structure](index=9&type=section&id=Liquidity%2C%20Financial%20Resources%2C%20and%20Capital%20Structure) As of June 30, 2025, the Group faced a capital deficit of approximately **USD 166.7 million**, a current ratio of **0.3**, and significant overdue borrowings, indicating substantial liquidity pressure Liquidity Position (Thousand USD) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Capital Deficit | (166,662) | (167,490) | | Current Assets | 61,686 | 61,339 | | Current Liabilities | 244,234 | 243,874 | | Current Ratio | 0.3 | 0.3 | | Cash and Cash Equivalents | 91 | 248 | - As of June 30, 2025, approximately **USD 54.869 million** in principal borrowings and approximately **USD 21.022 million** in interest payable were overdue, and the company was in breach of borrowing terms and conditions[83](index=83&type=chunk) [Legal Proceedings](index=10&type=section&id=Legal%20Proceedings) The company and its controlling shareholder face multiple legal actions, including a **USD 60 million** claim from Industrial Bank against the company for the controlling shareholder's outstanding debt, and a statutory demand for **RMB 250.97 million** - Industrial Bank is claiming **USD 60,000,000** in principal and other incidental damages from the company due to the controlling shareholder Yutian's outstanding loans, as Yutian had assigned its shareholder loan rights to Industrial Bank[36](index=36&type=chunk)[85](index=85&type=chunk) - The company received a statutory demand for payment of an alleged debt of **RMB 250,974,633.21**, which the company denies and is seeking legal advice on[86](index=86&type=chunk)[87](index=87&type=chunk) [Employees and Remuneration Policy](index=10&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group employed **50 staff**, with slightly reduced staff costs, and remuneration policies aligned with market practices and individual performance - As of June 30, 2025, the Group employed **50 staff**, an increase from **47 staff** as of December 31, 2024[38](index=38&type=chunk) - Total staff costs (including directors' emoluments) for the period were approximately **USD 0.6 million**, a slight decrease, with remuneration policies aligned with market practices and determined based on individual performance and experience[38](index=38&type=chunk) Other Information [Ibam Mine Resources and Reserves Information under JORC Code as of June 30, 2025](index=11&type=section&id=Ibam%20Mine%20Resources%20and%20Reserves%20Information%20under%20JORC%20Code%20as%20of%20June%2030%2C%202025) As of June 30, 2025, the Ibam mine, under JORC Code, holds a total mineral resource of **144 million tons** (average iron grade **46.6%**) and a probable ore reserve of **102 million tons** (average iron grade **44.6%**) Ibam Mine Mineral Resources (Iron Grade >= 35%) | Category | Reserves (Million Tons) | Iron Grade (%) | | :--- | :--- | :--- | | Measured | 102 | 46.7 | | Inferred | 42 | 46.6 | | Total | 144 | 46.6 | Ibam Mine Ore Reserves (Iron Grade >= 35%) | Category | Reserves (Million Tons) | Iron Grade (%) | | :--- | :--- | :--- | | Probable | 102 | 44.6 | [Mining Production Activities and Capital Expenditures](index=11&type=section&id=Mining%20Production%20Activities%20and%20Capital%20Expenditures) Mining production activities were zero during the period, with no significant capital expenditures for the purchase or upgrade of property, plant, and equipment - Mining volume and production volume were both **zero tons** for the period, consistent with the previous period[43](index=43&type=chunk) - The company made no significant capital expenditures for the purchase or upgrade of property, plant, and equipment or prepayments during the period[44](index=44&type=chunk) [Corporate Governance and Board Committees](index=12&type=section&id=Corporate%20Governance%20and%20Board%20Committees) The company is committed to good corporate governance, complying with listing rules, and has established audit, remuneration, and nomination committees to ensure transparent board operations and independence - The company has complied with the code provisions set out in Appendix C1 "Corporate Governance Code" and "Corporate Governance Report" of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[48](index=48&type=chunk) - All directors confirmed compliance with the required standards set out in the "Model Code for Securities Transactions by Directors of Listed Issuers"[49](index=49&type=chunk) [Audit Committee](index=12&type=section&id=Audit%20Committee) The Audit Committee is responsible for reviewing and overseeing the Group's financial reporting process, internal controls, and risk management systems, and has reviewed the unaudited interim results for the period - The primary responsibilities of the Audit Committee are to review and oversee the Group's financial reporting process, internal control and risk management systems, and to provide recommendations to the Board on the appointment of independent auditors[50](index=50&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and discussed internal controls and financial reporting matters with management, including reviewing the unaudited interim results for the period[50](index=50&type=chunk) [Remuneration Committee](index=13&type=section&id=Remuneration%20Committee) The Remuneration Committee is responsible for recommending remuneration policies and structures, and approving the remuneration packages for all directors and senior management, ensuring transparency and alignment with company and individual performance - The Remuneration Committee comprises two independent non-executive directors and one executive director, with responsibilities including recommending remuneration policies and structures and approving remuneration packages for directors and senior management[52](index=52&type=chunk) - The Remuneration Committee held one meeting during the period to review and discuss the remuneration packages of management and directors to enhance the Group's management quality[53](index=53&type=chunk) [Nomination Committee](index=13&type=section&id=Nomination%20Committee) The Nomination Committee is responsible for identifying and recommending suitable candidates for directorships, evaluating the board structure, and formulating nomination policies to ensure the independence of board members - The Nomination Committee comprises one executive director and two independent non-executive directors, with primary responsibilities including identifying and recommending suitable candidates for directorships to the Board, and evaluating the structure and composition of the Board[54](index=54&type=chunk) - The Nomination Committee held one meeting during the period, and all independent non-executive directors confirmed their independence[54](index=54&type=chunk)[55](index=55&type=chunk) [Directors' and Major Shareholders' Interests](index=14&type=section&id=Directors%27%20and%20Major%20Shareholders%27%20Interests) As of June 30, 2025, Director Mr. Ng Khing Yeu held **7.52%** of the company's shares through a controlled corporation, while major shareholder Yutian and its associates held **50.18%**, involving multiple share pledges Directors' Long Positions in the Company's Shares (June 30, 2025) | Director Name | Nature of Interest | Number of Ordinary Shares | Approximate % of Issued Share Capital | | :--- | :--- | :--- | :--- | | Ng Khing Yeu | Interest in controlled corporation | 112,827,000 (L) | 7.52% | Major Shareholders' Long Positions in the Company's Shares (June 30, 2025) | Major Shareholder | Capacity/Nature of Interest | Number of Shares | Approximate % of Shareholding | | :--- | :--- | :--- | :--- | | Yutian | Beneficial owner | 752,750,000 (L) | 50.18% | | Li Yang | Interest in controlled corporation | 752,750,000 (L) | 50.18% | | Ample Professional Limited | Interest in share charge | 752,000,000 (L) | 50.13% | | Hua Heng | Beneficial owner | 100,575,000 (L) | 6.71% | | Grace Era | Beneficial owner | 112,827,000 (L) | 7.52% | | Sichuan Chuanjiu Group International Trade Co., Ltd. | Beneficial owner | 91,000,000 (L) | 6.07% | - Yutian has pledged **752,000,000 shares** (approximately **50.13%** of the company's issued share capital) to an independent third-party institution[63](index=63&type=chunk) [Interim Dividend and Financial Information Review](index=17&type=section&id=Interim%20Dividend%20and%20Financial%20Information%20Review) The Board resolved not to declare any interim dividend for the period, and the condensed consolidated financial statements in this interim report have not been audited or reviewed by the company's auditors - The Board resolved not to declare any interim dividend for the period (H1 2024: None)[66](index=66&type=chunk) - The financial information in the condensed consolidated financial statements of the interim report has not been audited or reviewed by the company's auditors[67](index=67&type=chunk) Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=18&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group's revenue increased to **USD 8.417 million**, gross profit was **USD 1.132 million**, and a profit of **USD 151 thousand** was achieved for the period, a significant improvement from the loss in the prior year Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Thousand USD) | Metric | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Revenue | 8,417 | 5,969 | | Cost of Sales | (7,285) | (4,986) | | Gross Profit | 1,132 | 983 | | Other Income and Gains | 9,882 | 49 | | Administrative and Other Expenses | (1,080) | (1,239) | | Finance Costs | (9,496) | (8,393) | | Profit (Loss) for the Period | 151 | (8,996) | | Basic and Diluted Earnings (Loss) Per Share (US Cents) | 0.01 | (0.60) | - Other income and gains for the period significantly increased to **USD 9,882 thousand**, primarily due to an interest waiver gain of **USD 9,881 thousand**[69](index=69&type=chunk)[104](index=104&type=chunk) Interim Condensed Consolidated Statement of Financial Position [Interim Condensed Consolidated Statement of Financial Position](index=19&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were **USD 81.134 million**, total liabilities were **USD 247.796 million**, resulting in a capital deficit of **USD 166.662 million** and net current liabilities of **USD 182.548 million** Interim Condensed Consolidated Statement of Financial Position (Thousand USD) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Non-current Assets | 19,448 | 18,464 | | Total Current Assets | 61,686 | 61,339 | | Total Current Liabilities | 244,234 | 243,874 | | Net Current Liabilities | (182,548) | (182,535) | | Total Non-current Liabilities | 3,562 | 3,419 | | Capital Deficit | (166,662) | (167,490) | - Current assets primarily include **trade receivables of USD 59,260 thousand**, while current liabilities mainly comprise **notes of USD 85,090 thousand**, **bank and other borrowings of USD 55,019 thousand**, and **amounts due to ultimate holding company of USD 60,000 thousand**[71](index=71&type=chunk) Interim Condensed Consolidated Statement of Changes in Equity [Interim Condensed Consolidated Statement of Changes in Equity](index=20&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, the Group's capital deficit slightly narrowed, primarily due to the positive impact of profit for the period and exchange fluctuation reserve, despite a decrease in non-controlling interests Interim Condensed Consolidated Statement of Changes in Equity (Thousand USD) | Item | Jan 1, 2025 (Audited) | Profit (Loss) for the Period | Exchange Differences | Transfer to Statutory Reserve | June 30, 2025 (Unaudited) | | :--- | :--- | :--- | :--- | :--- | :--- | | Equity attributable to owners of the Company | (167,396) | 211 | 677 | – | (166,508) | | Non-controlling interests | (94) | (60) | – | – | (154) | | Capital Deficit | (167,490) | 151 | 677 | – | (166,662) | - Total comprehensive income for the period was **USD 828 thousand**, primarily contributed by **USD 888 thousand** attributable to owners of the parent company, which includes exchange differences of **USD 677 thousand** arising from the translation of financial statements from functional currency to presentation currency[72](index=72&type=chunk) Interim Condensed Consolidated Statement of Cash Flows [Interim Condensed Consolidated Statement of Cash Flows](index=22&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, the Group's net cash used in operating activities was **USD 76 thousand**, and net cash used in financing activities was **USD 82 thousand**, leading to a decrease in cash and cash equivalents to **USD 91 thousand** at period-end Interim Condensed Consolidated Statement of Cash Flows (Thousand USD) | Activity | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (76) | (199) | | Net Cash Used in Investing Activities | – | (2) | | Net Cash (Used in) Generated from Financing Activities | (82) | 313 | | Net (Decrease) / Increase in Cash and Cash Equivalents | (158) | 112 | | Cash and Cash Equivalents at End of Period | 91 | 242 | - Cash and cash equivalents at the end of the period decreased from **USD 248 thousand** at the beginning of the period to **USD 91 thousand**, reflecting pressure from cash outflows during the period[80](index=80&type=chunk) Notes to the Interim Condensed Consolidated Financial Statements [General Information and Basis of Preparation](index=23&type=section&id=General%20Information%20and%20Basis%20of%20Preparation) The Group's financial statements are prepared in accordance with IAS 34, but face significant going concern uncertainties, including substantial overdue borrowings, legal proceedings, and a capital deficit, with management implementing measures to mitigate liquidity pressure - The company is an investment holding company primarily engaged in iron ore product mining, ore beneficiation, sales of iron ore, other commodities, and health products[81](index=81&type=chunk) - As of June 30, 2025, the Group's amounts due to ultimate holding company, bank and other borrowings, and guaranteed notes totaled approximately **USD 200,109,000**, while cash and cash equivalents were only approximately **USD 91,000**[83](index=83&type=chunk) - The Group faces multiple legal proceedings and cross-default risks, including a **USD 60,000,000** claim from Industrial Bank and a statutory demand for **RMB 250,974,633.21**[85](index=85&type=chunk)[86](index=86&type=chunk) - Management has taken measures, including the ultimate holding company agreeing not to demand repayment of **USD 60,000,000**, actively negotiating borrowing renewals and extensions, seeking debt restructuring and strategic investors, and controlling costs while expanding revenue sources[88](index=88&type=chunk) [Revenue and Segment Information](index=26&type=section&id=Revenue%20and%20Segment%20Information) In H1 2025, the Group's revenue primarily derived from health products and other product sales, all recognized at a point in time in the Chinese market. Segment results show health product trading contributed the main revenue and profit, while iron ore mining and commercial trading segments recorded losses Revenue from Contracts with Customers by Category (Thousand USD) | Product Category | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Sales of health products | 8,288 | 5,969 | | Sales of other products | 129 | – | | Total | 8,417 | 5,969 | - All revenue is recognized at a point in time and entirely from the People's Republic of China market[93](index=93&type=chunk) Segment Revenue and Results (H1 2025, Thousand USD) | Segment | Segment Revenue | Segment (Loss) Profit | | :--- | :--- | :--- | | Iron ore mining and beneficiation business | – | (9) | | Commercial trading | – | (1,734) | | Health product trading | 8,288 | 235 | | Others | 129 | 11 | | Total | 8,417 | (1,497) | Segment Assets and Liabilities (June 30, 2025, Thousand USD) | Segment | Total Segment Assets | Total Segment Liabilities | | :--- | :--- | :--- | | Iron ore mining and beneficiation business | 12,895 | 739 | | Commercial trading | 51,294 | 186,570 | | Health product trading | 10,260 | 8,482 | | Others | 104 | 11 | | Total | 74,553 | 195,802 | [Finance Costs and Income Tax Expense](index=31&type=section&id=Finance%20Costs%20and%20Income%20Tax%20Expense) In H1 2025, finance costs increased to **USD 9.496 million**, primarily from notes interest, while income tax expense remained stable, mainly comprising China corporate income tax Finance Costs (Thousand USD) | Item | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Interest on bank borrowings | 1,733 | 1,743 | | Interest on other borrowings | 259 | 460 | | Interest on notes | 7,504 | 6,190 | | Total | 9,496 | 8,393 | - Income tax expense primarily consists of China corporate income tax, amounting to **USD 17 thousand** in H1 2025, largely consistent with H1 2024[103](index=103&type=chunk) [Profit (Loss) for the Period and Earnings (Loss) Per Share](index=33&type=section&id=Profit%20(Loss)%20for%20the%20Period%20and%20Earnings%20(Loss)%20Per%20Share) The Group achieved a profit of **USD 151 thousand** in H1 2025, mainly due to an interest waiver gain of **USD 9.881 million**, with basic and diluted earnings per share of **0.01 US cents** - Profit (loss) for the period was achieved after deducting (including) an interest waiver gain of **USD 9,881 thousand**[104](index=104&type=chunk) Earnings (Loss) Per Share | Metric | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Profit (Loss) for calculating basic and diluted earnings (loss) per share (Thousand USD) | 211 | (8,966) | | Weighted average number of ordinary shares (Thousand Shares) | 1,500,000 | 1,500,000 | | Basic and diluted earnings (loss) per share (US Cents) | 0.01 | (0.60) | [Trade Receivables and Payables](index=34&type=section&id=Trade%20Receivables%20and%20Payables) As of June 30, 2025, total trade receivables were **USD 59.260 million**, with the majority overdue by more than **365 days**; total trade payables were **USD 6.895 million**, with a significant increase in those overdue by more than **365 days** Ageing Analysis of Trade Receivables (Thousand USD) | Ageing | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Within 30 days | 233 | 1,858 | | Over 365 days | 56,946 | 56,514 | | Total | 59,260 | 59,239 | Ageing Analysis of Trade Payables (Thousand USD) | Ageing | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Within 90 days | 468 | 1,685 | | Over 365 days | 4,945 | – | | Total | 6,895 | 6,634 | [Bank and Other Borrowings](index=36&type=section&id=Bank%20and%20Other%20Borrowings) As of June 30, 2025, the Group's total bank and other borrowings amounted to **USD 55.019 million**, with most repayable within one year or on demand, and some overdue. During the period, the company reached an interest waiver agreement with lenders, waiving approximately **USD 9.881 million** in accrued interest Bank and Other Borrowings (Thousand USD) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Bank borrowings | 36,683 | 36,752 | | Other borrowings | 18,336 | 18,336 | | Total | 55,019 | 55,088 | | Repayable within one year or on demand | 55,019 | 55,031 | - Bank loans carry floating interest rates ranging from **7.31% to 8.66% per annum**, partly secured by trade receivables and guaranteed by the company and directors[113](index=113&type=chunk) - On April 8, 2025, the company entered into an interest waiver agreement with relevant lenders, waiving approximately **USD 9,881,000** in accrued interest, with no further interest accruing from that date[115](index=115&type=chunk) [Notes](index=38&type=section&id=Notes) As of June 30, 2025, the Group's total notes amounted to **USD 85.090 million**, all classified as current liabilities, including Note 1 and Note 2, both involving multiple renegotiations of terms and guarantee arrangements Notes Overview (Thousand USD) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Note 1 | 67,090 | 60,172 | | Note 2 | 18,000 | 18,000 | | Total | 85,090 | 78,172 | | Current Liabilities | 85,090 | 78,172 | [Note 1](index=38&type=section&id=Note%201) Note 1 has a principal amount of approximately **USD 21.27 million**, originally with an annual interest rate of **12%**, and has undergone multiple redemption date extensions and term renegotiations, including interest accruing at the original annual rate plus **10%**, and a waiver of the debt-to-equity ratio condition - Note 1 has a principal amount of approximately **USD 21,270,000**, with an original annual interest rate of **12%**, payable quarterly[116](index=116&type=chunk) - The final redemption date of Note 1 was extended multiple times, from March 19, 2018, to June 30, 2019, with interest accruing at the original annual rate plus **10%**[119](index=119&type=chunk)[121](index=121&type=chunk) - The holder of Note 1 agreed to waive the condition regarding the company's debt-to-equity ratio exceeding a specified proportion and agreed to the sale of **9.12%** of Pacific Mining's issued shares[122](index=122&type=chunk)[123](index=123&type=chunk) [Note 2](index=41&type=section&id=Note%202) Note 2 has a principal amount of **USD 20.0 million** with a fixed interest rate of **7%**, guaranteed by Yutian and Mr. Li, and secured by **172,352,000** of the company's shares - Note 2 has a principal amount of **USD 20,000,000**, with a fixed interest rate of **7%**, maturing two years from the issue date[123](index=123&type=chunk) - Note 2 is guaranteed by Yutian and Mr. Li and secured by a total of **172,352,000** of the company's shares[125](index=125&type=chunk) - As of June 30, 2025, accrued interest on Note 2, recognized as interest payable, was approximately **USD 7,899,000**[125](index=125&type=chunk) [Share Capital and Related Party Transactions](index=42&type=section&id=Share%20Capital%20and%20Related%20Party%20Transactions) The company's authorized share capital is **3,000,000 thousand shares**, with **1,500,000 thousand shares** issued and fully paid. Several bank financings and notes are guaranteed by Director Mr. Li and the ultimate holding company Yutian, constituting significant related party transactions Share Capital Structure (Thousand Shares/Thousand USD) | Item | Number of Shares (Thousand Shares) | Share Capital (Thousand USD) | | :--- | :--- | :--- | | Authorized share capital | 3,000,000 | 3,867 | | Issued and fully paid share capital | 1,500,000 | 1,934 | - Director Mr. Li provides guarantees for the Group's bank financings and, together with the ultimate holding company Yutian, guarantees the Group's issued **12%** senior secured notes and **7%** fixed-rate coupon secured notes[127](index=127&type=chunk) - Remuneration for key management personnel in H1 2025 was **USD 44 thousand**, a decrease from **USD 120 thousand** in H1 2024[128](index=128&type=chunk)

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，並明確表示概不對因本公告全部或任何 部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 恩典生命科技控股有限公司 Grace Life-tech Holdings Limited 於本公告日期，執行董事為Ng Khing Yeu先生、李曉蘭女士及王爾先生；以及獨立 非執行董事為董捷先生、汪靈博士及梁耀祖先生。 恩典生命科技控股有限公司 主席 Ng Khing Yeu 香港，二零二五年八月十九日 （於開曼群島註冊成立的有限公司） （已委任聯席臨時清盤人） （僅適用於公司重組） （股份代號：02112） 董事會會議日期 恩典生命科技控股有限公司（「本公司」）董事（「董事」）會（「董事會」）謹此宣佈， 董事會會議將於二零二五年八月二十九日舉行，藉以處理以下（其中包括）事項： 考慮及批准本公司及其附屬公司截至二零二五年六月三十日止六個月的中期業績 及其刊發，並考慮派付中期股息（如有）。 承董事會命 ...

本公司一直就債務重組方案進行內部籌備工作，涉及的未償還銀行貸款及票據本 金總額約為1.95億美元，並正安排於二零二五年第三季度與一家於中國境內註冊 並在中國證券投資基金業協會(AMAC)登記的私募股權投資基金舉行面議。 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，並明確表示概不對因本公告全部或任何 部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 恩典生命科技控股有限公司 Grace Life-tech Holdings Limited （於開曼群島註冊成立的有限公司） （已委任聯席臨時清盤人） （僅適用於公司重組） （股份代號：02112） 補充公告 恩典生命科技控股有限公司（「本公司」）董事（各自為「董事」）會（「董事會」）謹 此就本公司日期為二零二五年六月三十日之公告（「該公告」）提供補充資料。除 另有界定外，本公告所用詞彙與該公告所界定者具有相同涵義。 截至二零二五年六月三十日止六個月，本集團繼續拓展植物幹細胞業務的營運， 期間新增五名客戶。 本公司目前正與一家於中國註冊成立的有限責任公司（該公司專注於投資、房地 產開發及租 ...

FF301 第 1 頁 共 10 頁 v 1.1.1 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 截至月份: 2025年7月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 恩典生命科技控股有限公司(於開曼群島註冊成立的有限公司)(已委任聯席臨時清盤人)(僅作重組用途) 呈交日期: 2025年8月4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) | 02112 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 3,000,000,000 | HKD | | 0.01 | HKD | | 30,000,000 | | 增加 / 減少 (-) | | | | 0 | | | HKD | | 0 | | 本月底結存 ...

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，並明確表示概不對因本公告全部或任何 部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 恩典生命科技控股有限公司 Grace Life-tech Holdings Limited （於開曼群島註冊成立的有限公司） （已委任聯席臨時清盤人） （僅適用於公司重組） （股份代號：02112） 補充公告 恩典生命科技控股有限公司（「本公司」）董事（各自為「董事」）會（「董事會」）擬 提供有關其截至二零二四年十二月三十一日止年度的年報（「年報」）之額外資料。 除另有所指外，本公告所用詞彙與年報所界定者具有相同涵義。 礦業業務 於二零二五年四月二十三日，本集團與一間馬來西亞礦業管理公司（「合夥人A」） 訂立合作協議，本集團於二零二五年二月與合夥人A相遇及自此開始探索開採錫 精礦的可能性。本集團將向合夥人A提供採礦許可證、現有採礦機器及設備以及生 產人員，以於Ibam礦山進行勘探及開採。 合夥人A已與一間主要於中國從事礦產材料進出口的公司訂立合作協議，以帶來 流程技術、設備安裝及選礦生產管理之專業知識及技 ...

Grace Life Technology Holdings Limited 2024 Annual Report Supplement Announcement [Measures and Current Status Addressing the 'Disclaimer of Opinion'](index=1&type=section&id=Disclaimer%20of%20Opinion) This section outlines the company's multi-faceted strategies, encompassing business development, debt restructuring, receivables recovery, cost control, and legal petition management, to address the auditor's disclaimer of opinion and enhance financial sustainability [Business Development](index=1&type=section&id=Business%20Development) The company has pivoted to the plant stem cell business, suspending iron ore operations, and is expanding its B2B market through outsourced production, distributor networks, new product launches, and strategic partnerships, generating new revenue and securing minor bank loans - Due to declining iron ore prices, the company has suspended its iron ore business while evaluating other revenue possibilities, such as tin concentrate as a byproduct[4](index=4&type=chunk) - The company is actively developing its plant stem cell business using a B2B model, outsourcing production to external factories, and has launched new products like ginseng stem cell liquor and high-fiber probiotic beverages to expand its market[5](index=5&type=chunk)[6](index=6&type=chunk) - A strategic cooperation framework agreement was signed with Tianjin Bingcaogangmu in June 2024, leveraging its sales network to promote products and generating approximately **$3.3 million** in new revenue from this partnership during the year[6](index=6&type=chunk)[15](index=15&type=chunk) - To support working capital, the company borrowed **RMB 2.1 million** in unsecured bank loans during the year, with annual interest rates ranging from **14.3% to 18.0%**[6](index=6&type=chunk) [Debt and Financing Status](index=3&type=section&id=Debt%20and%20Financing%20Status) The company faces severe debt pressure, engaging in restructuring negotiations with multiple creditors, including a **$60 million** loan from controlling shareholder Yutian, approximately **$27.7 million** from a third-party merchant, about **$36.8 million** in bank loans (primarily OCBC), and approximately **$78.2 million** in overdue notes, while also facing fundraising challenges due to unfavorable market conditions Debt Overview | Debt Type | Related Party | Amount (Approx.) | Status | | :--- | :--- | :--- | :--- | | Shareholder Loan | Controlling Shareholder Yutian | $60 million | Verbally agreed not to demand repayment, but no formal agreement | | Shareholder Loan 2 | Yutian/Industrial Bank | $40 million | Loan rights assigned to Industrial Bank due to Yutian's default to Industrial Bank | | Other Borrowings | Hong Kong Merchant (Third Party) | $27.7 million (Principal & Interest) | Verbally agreed not to demand repayment, formal agreement under negotiation | | Bank Loans | OCBC Bank, etc. | $36.75 million | Defaulted, debt restructuring being handled by asset management company | | Outstanding Notes | Noteholders 1 & 2 | $78.2 million (Total) | Defaulted, restructuring negotiation being handled by asset management company | - Due to uncertain future economic growth and a high-interest rate environment, investor sentiment is cautious, posing fundraising challenges for the company, with only preliminary discussions held with potential investors[11](index=11&type=chunk)[14](index=14&type=chunk) [Recovery of Outstanding Trade Debts](index=5&type=section&id=Recovery%20of%20Outstanding%20Trade%20Debts) As of year-end 2024, the company's total trade receivables were approximately **$224 million**, with formal repayment agreements reached with two major debtors accounting for over **80%** of the outstanding amount, though repayment progress is slow, prompting further negotiation for accelerated recovery Trade Receivables Summary | Item | 2024 (USD Thousands) | 2023 (USD Thousands) | | :--- | :--- | :--- | | **Total Trade Receivables** | **224,326** | **225,065** | | Of which: Debtor A | 111,356 | 111,468 | | Of which: Debtor B | 73,178 | 73,681 | - Formal repayment agreements have been reached with major debtors A and B, with each repaying **HKD 200,000** monthly since mid-2024; the company acknowledges the current repayment plan is not optimal and will continue negotiations to accelerate recovery[16](index=16&type=chunk)[18](index=18&type=chunk) [Cost Control](index=6&type=section&id=Cost%20Control) To control administrative costs, the company has implemented various measures, including optimizing staffing (reducing employees from **45 to 40**), adjusting to a performance-based compensation structure, and strictly controlling non-essential expenditures - Multiple cost control measures have been implemented, including optimizing staff allocation, with total employees reduced from **45** at year-end 2023 to **40** at year-end 2024[19](index=19&type=chunk) - Compensation structure has been adjusted from fixed salaries to performance-based incentives, while unnecessary business travel is restricted and online meetings are encouraged[19](index=19&type=chunk) [Petitions and Legal Status](index=6&type=section&id=Petitions%20and%20Legal%20Status) In 2021, the company proactively filed a 'light-touch' winding-up petition with the Cayman Court to facilitate debt restructuring while retaining business management; additionally, a statutory demand for approximately **RMB 251 million** was received, but its validity is disputed, and no winding-up proceedings have been initiated by the claimant - In June 2021, the company proactively filed a 'light-touch' winding-up petition with the Cayman Court to appoint joint provisional liquidators to assist with debt restructuring[20](index=20&type=chunk) - The company received a statutory demand for repayment of approximately **RMB 251 million**, but internal review raised doubts about its validity due to no prior business dealings with the claimant[22](index=22&type=chunk) - As of December 31, 2024, the company had not received any winding-up petitions or legal proceedings notices related to the aforementioned statutory demand[22](index=22&type=chunk) [Future Plans to Address the 'Disclaimer of Opinion' (FY2025)](index=8&type=section&id=Company%27s%20Resolution%20Plan%20for%20Disclaimer%20of%20Opinion) For FY2025, the company has formulated a comprehensive resolution plan to address issues leading to the 'disclaimer of opinion,' focusing on achieving at least **20%** sales growth in plant stem cell business, formalizing key debt agreements, introducing new partners for overall debt restructuring, pursuing financing opportunities, and targeting approximately **10%** administrative cost savings - **Business Growth**: Plans to achieve no less than **20%** sales growth in the plant stem cell business in FY2025 by launching new products like beauty and personal care items and adding **3-5** new distributors[24](index=24&type=chunk) - **Debt Management**: Plans to sign formal written agreements with shareholder Yutian and third-party lenders in 2025, and engage with a Beijing-based private equity fund to explore debt consolidation plans[24](index=24&type=chunk) - **Receivables Recovery**: Meetings will be held with major debtors A and B in Q4 FY2025 to negotiate methods for accelerating repayment progress[27](index=27&type=chunk) - **Cost Savings**: Aims to save approximately **10%** in administrative costs in FY2025 through measures including improving labor efficiency, salary reviews, and controlling capital expenditures[27](index=27&type=chunk)

Financial Performance - Revenue for the year 2024 was $13.764 million, a decrease of 49% compared to $27.255 million in 2023[4] - Loss attributable to the company's owners was $(48.128) million, representing a 22% increase from $(39.566) million in the previous year[4] - Total assets decreased by 27% to $79.803 million from $108.949 million in 2023[4] - The current ratio decreased to 0.25 from 0.4 in the previous year, indicating a decline in liquidity[4] - Basic loss per share increased to 3.21 cents from 2.63 cents in 2023[4] - The gross profit for 2024 was approximately $2.2 million, down from about $2.8 million in 2023[12] - The annual loss for 2024 was $48 million, an increase of 22% from the $40 million loss in 2023[12] - The company's sales revenue for the year ending December 31, 2024, was approximately $13.76 million, a decrease of 49.5% compared to $27.26 million in 2023[32] - The sales of health products amounted to $13.25 million in 2024, showing a slight increase of 1.79% from $13.02 million in 2023[32] - The cost of sales for the company decreased by approximately 52.5% to about $11.6 million in 2024, down from approximately $24.4 million in 2023[35] - The iron ore sales generated no revenue in 2024, compared to $8.6 million in 2023, primarily due to market uncertainties[34] - The group recorded a loss of approximately $48.2 million for the year ended December 31, 2024, compared to a loss of approximately $39.6 million in 2023, with the increase mainly attributed to higher impairment losses on financial assets[40] - As of December 31, 2024, the group had a capital deficiency of approximately $167.5 million, compared to $119.9 million as of December 31, 2023[41] - The net current liabilities increased from approximately $134.4 million as of December 31, 2023, to approximately $182.5 million as of December 31, 2024, primarily due to a decrease in trade receivables[47] - The company has a total of approximately $193.26 million in debts owed to the ultimate holding company, banks, and other borrowings[126] Operational Strategy - The company continued to invest in R&D and market expansion in the plant stem cell business, enhancing product efficacy and competitiveness[11] - The company aims to diversify applications of plant stem cell products in health, beauty, and pharmaceuticals to expand market coverage[11] - The company plans to establish a global R&D center and collaborate with renowned research institutions to focus on key technological breakthroughs in plant stem cell technology[22] - The company aims to install 10,000 vending machines nationwide to enhance market reach for its functional health products[16] - The company plans to open over 50 plant stem cell health management centers across the country in 2025 to provide personalized health solutions[22] - The company is actively seeking strategic investors to optimize production processes and enhance cash flow for future recovery[21] - The company plans to establish a production base and sales channels for functional health products based on plant stem cell research, expected to generate significant operating cash flow by 2025[123] Environmental Commitment - The company is committed to sustainable development, implementing environmental measures to ensure efficient resource use and reduce carbon emissions[11] - The group complies with all relevant environmental protection laws and regulations, with no confirmed non-compliance incidents or complaints reported for the fiscal year 2024[142] - The total air emissions are minimal due to the limited scale of mining and production activities, with no recorded data for the fiscal year 2024[143] - The group is committed to integrating sustainable development concepts into daily operations and continuously seeks opportunities to improve performance and reduce environmental impact[141] - The company has adhered to all relevant laws and regulations regarding waste management, with no significant non-compliance incidents reported in fiscal years 2024 and 2023[154] - The company has committed to a paperless operation system by promoting the use of technology in communications and encouraging double-sided printing[155] Employee and Governance - As of December 31, 2024, the company employed 40 employees, down from 45 in 2023, with total employee costs, including director remuneration, approximately 1.3 million dollars[62] - The company has a comprehensive support policy for pregnant employees, ensuring they can return to their original positions after maternity leave[166] - There were no reported injury cases in fiscal years 2024 and 2023, indicating a safe working environment[168] - The company emphasizes a competitive compensation policy to retain talent, adjusting salaries annually to meet market standards[165] - The company has established an audit committee, nomination committee, and remuneration committee to oversee specific matters, with most members being independent non-executive directors[86] - The board of directors consists of three executive directors and three independent non-executive directors as of December 31, 2024[78] - The company has implemented measures to address the "unable to express opinion" issue raised by auditors, focusing on improving its financial situation and operational cash flow[125] Risk Management - The company has established a robust risk management framework since 2016, following the COSO framework for effective risk management[101] - The main risk identified for 2024 is the potential decrease in business due to economic recession or political instability, particularly affecting iron ore sales[103] - The audit committee has reviewed the internal control and risk assessment reports, confirming the effectiveness of the internal control system[107] - The risk register is maintained to track identified risks and actions taken to mitigate them, with annual evaluations of risks based on their likelihood and potential impact[105] Market Trends - The health industry in China is projected to reach a market value of 16 trillion yuan by 2030, driven by rising health awareness and consumption upgrades[24] - The health supplement market in China reached a scale of 387.9 billion yuan in 2023, with a year-on-year growth of 29.78%, and is expected to grow to 506.7 billion yuan by 2028, reflecting a 19.59% increase[27] - The per capita disposable income of urban residents in China increased from 19,000 yuan in 2010 to 52,000 yuan in 2023, supporting the growth of the health supplement market[27] - The aging population in China, with those aged 60 and above increasing from 185 million (13.7%) in 2011 to 297 million (21.1%) in 2023, is expected to drive future demand in the health industry[28] Corporate Governance - The company has a policy regarding the health and safety of its products and services, ensuring compliance with relevant laws and regulations[189] - The company has implemented policies to prevent child labor and forced labor, with measures in place to review recruitment practices[189] - The group has fully complied with the Personal Data (Privacy) Ordinance and other relevant laws to protect the rights of employees, customers, and business partners[178] - The group maintains a clear policy against corruption and has established a confidential reporting channel for employees and external stakeholders to report unethical behavior[179]

Financial Performance - Revenue for the year ended December 31, 2024, was $13.764 million, a decrease of 49% compared to $27.255 million in 2023[6] - Loss attributable to owners of the company was $(48.128) million, representing a 22% increase from $(39.566) million in the previous year[6] - Total assets decreased by 27% to $79.803 million from $108.949 million in 2023[6] - Trade receivables fell by 34% to $59.239 million compared to $89.523 million in 2023[6] - The gross profit for 2024 was approximately $2.2 million, down from about $2.8 million in 2023[14] - The annual loss for 2024 was $48 million, an increase of 22% from the $40 million loss in 2023[14] - The company's sales revenue for the year ended December 31, 2024, was $13.76 million, a decrease of 49.5% compared to $27.26 million in 2023[34] - The sales cost for the year ended December 31, 2024, was approximately $11.6 million, a decrease of 52.5% from about $24.4 million in 2023[37] - Gross profit for the year ended December 31, 2024, was approximately $2.2 million, a decrease from approximately $2.8 million for the year ended December 31, 2023, primarily due to insufficient sales of iron ore and electronic products[38] - The group recorded a loss of approximately $48.2 million for the year ended December 31, 2024, compared to a loss of approximately $39.6 million in 2023, with the increase mainly attributed to higher impairment losses on financial assets[42] Business Operations and Strategy - The company continued to invest in research and development, focusing on plant stem cell products to enhance market competitiveness[13] - The company aims to expand the application of plant stem cell products in health, beauty, and pharmaceutical sectors[13] - The company plans to launch innovative plant stem cell traditional Chinese medicine products to meet the growing market demand for high-quality health products[17] - The company aims to install 10,000 vending machines in high-traffic areas to reach a broader consumer base for its functional health products[18] - The plant stem cell business has become one of the company's most important revenue sources, with significant growth momentum expected to continue in the second half of the year[17] - Future strategies include enhancing technology research, market expansion, and sustainable operations to maintain competitive advantages globally[13] - In 2025, the company plans to open over 50 plant stem cell health management centers nationwide to provide personalized health solutions[24] Market Trends and Industry Insights - The health industry in China is projected to reach a market value of 16 trillion yuan by 2030, driven by rising health awareness and consumption upgrades[26] - The Chinese health supplement market reached 387.9 billion yuan in 2023, growing by 29.78% year-on-year, and is expected to reach 506.7 billion yuan by 2028, with a CAGR of 19.59%[29] - The per capita disposable income of urban residents increased from 19,000 yuan in 2010 to 52,000 yuan in 2023, supporting the growth of the health supplement market[29] - The aging population in China, with those aged 65 and above reaching 14.27% in 2023, is expected to drive future demand for health products[30] Financial Position and Liabilities - Current liabilities increased from approximately $134.4 million as of December 31, 2023, to approximately $182.5 million as of December 31, 2024, primarily due to a decrease in trade receivables and an increase in notes payable[49] - The company has approximately $193.26 million in outstanding payments to the ultimate holding company, banks, and other borrowings, while cash and cash equivalents totaled only about $248,000[128] - The ultimate holding company has agreed not to demand repayment of approximately $60 million due by December 31, 2024, until the company's financial situation allows[125] - Independent third-party lenders have agreed not to demand repayment of approximately $18.34 million in principal and $9.74 million in interest due by December 31, 2024, until the company's financial situation allows[125] Governance and Compliance - The board of directors consists of three executive directors and three independent non-executive directors, ensuring accountability and transparency in governance[80] - The company has established an audit committee, nomination committee, and remuneration committee to oversee specific matters, with most members being independent non-executive directors[88] - The audit committee reviewed the audited financial statements for the year ending December 31, 2024, confirming compliance with applicable accounting standards and regulations[89] - The company has a diversity policy in place for evaluating potential board candidates, considering factors such as gender, age, and professional experience[97] - The company has established a robust risk management framework since 2016, following the COSO framework for effective risk management[103] Environmental and Social Responsibility - The company emphasizes sustainable development and environmental measures in its production processes[13] - The group complies with all relevant environmental protection laws and regulations, with no confirmed non-compliance incidents or complaints reported for the fiscal year 2024[144] - The group is committed to integrating sustainable development concepts into daily operations and continuously seeks opportunities to improve performance and reduce environmental impact[143] - The total greenhouse gas emissions for fiscal year 2024 amounted to 68,098.82 kg, a substantial increase of 194.5% compared to 23,126.59 kg in fiscal year 2023[159] - The company has implemented measures to reduce energy consumption, including using energy-saving facilities and turning off unused lighting and appliances[154] Employee and Workplace Practices - The company employed 40 employees as of December 31, 2024, a decrease of 11.1% from 45 employees in 2023[164] - The number of male employees decreased from 32 in 2023 to 22 in 2024, while female employees increased from 13 to 18 during the same period[164] - Employee turnover rates for fiscal year 2024 are as follows: under 30 years old at 15.00%, 31 to 50 years old at 65.00%, and over 51 years old at 20.00%[167] - The company has implemented policies to ensure a safe and healthy work environment, including regular safety inspections and fire drills[172] - The company has not reported any workplace injuries in fiscal years 2024 and 2023[170] Community Engagement and Ethical Practices - The group encourages employee participation in community service to contribute to a more sustainable and harmonious society[183] - The group has established a confidential reporting channel for employees and external stakeholders to report unethical behavior[181] - The group actively participates in industry initiatives to combat corruption and financial crimes, maintaining clear policies against such practices[181]

Financial Performance - For the six months ended June 30, 2024, the group's revenue was approximately $6.0 million, a decrease from $15.1 million for the same period in 2023, representing a decline of about 60.4%[4] - The gross profit for the period was approximately $1.0 million, down from $2.0 million in the previous period, indicating a decrease of 50%[4] - The group recorded a loss of approximately $9.0 million for the period, an improvement from a loss of $10.5 million in the previous period, reflecting a reduction in loss of about 14.3%[4] - The company recorded a revenue of 5.97 million USD in the first half of 2023, a decrease from 15.1 million USD in the same period last year[15] - The company reported a loss before tax of $8,980,000, an improvement from a loss of $10,213,000 in the previous year[54] - The net loss for the period was $8,996,000, compared to a net loss of $10,461,000 in 2023, indicating a 14.0% reduction in losses[54] - The company reported a net loss of approximately $9,223,000 for the six months ended June 30, 2024[68] - The company reported a loss of $8,966,000 for the six months ended June 30, 2024, compared to a loss of $10,461,000 for the same period in 2023, a reduction of 14.3%[92] Revenue Sources - The plant stem cell business has become one of the company's most important revenue sources, with expectations for continued growth in the second half of the year[7] - The company plans to expand its plant stem cell business into traditional Chinese medicine production, aiming to meet the growing market demand for high-quality health products[7] - Revenue from iron ore sales was $4,737 thousand, while health product sales generated $6,682 thousand, and other product sales contributed $3,632 thousand[76] - The health products segment reported a profit of $691 thousand, while the commercial trading segment incurred a loss of $1,743 thousand[79] Market Trends - The Chinese health supplement market is experiencing rapid growth, with a market size reaching approximately 415.12 billion yuan in 2023, indicating significant potential for future expansion[10] - The Chinese traditional medicine market accounted for approximately 23.7% of the overall pharmaceutical market in 2023, with a market size exceeding 400 billion CNY[11] - The market size of Chinese medicinal materials is projected to reach 223.29 billion CNY in 2023, representing a year-on-year growth of 7.1%[12] Cost and Expenses - The sales cost for the period was approximately 5.0 million USD, down from about 13.0 million USD in the previous period[17] - Administrative expenses decreased by 21.1% to approximately 1.2 million USD, down from about 1.6 million USD in the previous period[19] - Financing costs increased by approximately 15.6% to about 8.4 million USD due to increased interest expenses from issued notes[20] - The company reported a decrease in total expenses, with comprehensive expenses totaling $(9,195) thousand for the six months ended June 30, 2024, compared to $(9,165) thousand in the same period of 2023[67] Shareholder and Governance - The board did not recommend the payment of an interim dividend for the period, consistent with the previous period[4] - The company aims to create long-term value for shareholders and customers through continuous strategic innovation and operational optimization[9] - The company established a Remuneration Committee consisting of two independent non-executive directors and one executive director to oversee compensation policies and structures[43] - The company received independence confirmations from all independent non-executive directors as per listing rules[43] - The Nomination Committee, consisting of one executive director and two independent non-executive directors, is responsible for recommending suitable candidates for the board[43] Debt and Liabilities - As of June 30, 2024, the company's borrowings included approximately 36.5 million USD from a commercial bank and 71.9 million USD in notes and bonds[23] - As of June 30, 2024, the company recorded a capital deficit of approximately $129.0 million, compared to $119.9 million as of December 31, 2023[24] - Current liabilities increased to $232,946,000 from $225,358,000, reflecting a rise of 3.5%[55] - The company has overdue borrowings totaling approximately $54,683,000 in principal and $26,710,000 in interest as of June 30, 2024[68] - The company is actively negotiating with lenders regarding the extension and rescheduling of defaulted loans[71] Operational Measures - The company is exploring various financing options with different financial institutions to secure operational funding for the foreseeable future[71] - The company has taken measures to expedite the collection of outstanding trade receivables[71] - The company is implementing cost control measures, including optimizing human resources and adjusting management salaries[71] Compliance and Corporate Governance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange listing rules during the reporting period[38] - There were no significant events after the reporting period[29] - The company has not disclosed any new product developments or market expansion strategies in the current report[52] - The company has not disclosed any new product launches or technological advancements during this reporting period[64] Employee and Management - The company employed 47 staff members as of June 30, 2024, with total employee costs, including director remuneration, amounting to approximately $0.6 million, a slight decrease from $0.7 million in the previous period[28] - Total compensation for key management personnel for the six months ended June 30, 2024, was $120,000, compared to $155,000 for the same period in 2023[110]

Financial Performance - For the six months ended June 30, 2024, the company's revenue was approximately $6.0 million, a decrease from approximately $15.1 million for the same period in 2023, representing a decline of about 60.4%[5] - The gross profit for the period was approximately $1.0 million, down from approximately $2.0 million in the previous period, indicating a decrease of 50%[5] - The company recorded a loss of approximately $9.0 million for the period, an improvement from a loss of approximately $10.5 million in the previous period, reflecting a reduction in loss of about 14.3%[5] - Revenue for the six months ended June 30, 2024, was $5,969,000, a decrease of 60.3% compared to $15,051,000 for the same period in 2023[55] - Gross profit for the same period was $983,000, down 51.6% from $2,033,000 in 2023[55] - The company reported a loss before tax of $8,980,000, an improvement from a loss of $10,213,000 in the previous year[55] - The net loss for the period was $8,996,000, compared to a net loss of $10,461,000 in 2023, indicating a 14.0% reduction in losses[55] - The company reported a total loss of $(178,227,000) for the six months ended June 30, 2024, compared to a loss of $(91,221,000) for the same period in 2023[65] - The company reported a comprehensive loss of $(216,366,000) for the six months ended June 30, 2024[68] Business Operations - The plant stem cell business has become one of the company's most important revenue sources, with significant progress in both breadth and depth, and is expected to continue its growth momentum in the second half of the year[8] - The company plans to further expand its plant stem cell business into the traditional Chinese medicine production sector, aiming to launch innovative products to meet market demand for high-quality health products[8] - The company will continue to pursue a diversified development strategy, focusing on exploring new growth opportunities, particularly in the traditional Chinese medicine production area[10] - The company continues to focus on expanding its operations in the health products and electronic products sectors[79] Market Conditions - Due to a decline in international iron ore prices, the company suspended all iron ore production and sales activities during the period, as the average price fell to approximately $100 per dry ton, below the company's extraction and processing costs[9] - The Chinese health supplement market reached a production volume of 730,300 tons and a demand of 720,700 tons in 2023, with a market size of 415.12 billion yuan[11] - The penetration rate of health supplements in the 35-44 age group in China is 11%, compared to 51% in the US, indicating significant growth potential[11] - The Chinese traditional medicine market accounted for 23.7% of the overall pharmaceutical market in 2023, with a market size exceeding 400 billion yuan[12] - The transaction value of Chinese medicinal materials is projected to reach 223.29 billion yuan in 2023, reflecting a year-on-year growth of 7.1%[13] Financial Position - As of June 30, 2024, the group's borrowings include approximately $36.5 million from a commercial bank, $18.2 million in loans, and $71.9 million in notes and bonds[24] - The group's capital deficit was approximately $129.0 million as of June 30, 2024, compared to $119.9 million on December 31, 2023[25] - Current assets totaled approximately $90.0 million, primarily consisting of trade receivables of $88.8 million, cash and cash equivalents of $0.2 million, and other receivables of $0.2 million[25] - Current liabilities amounted to approximately $232.9 million, with significant components including trade payables of $5.4 million and bank borrowings of $54.7 million[25] - Total assets as of June 30, 2024, were $107,564,000, a slight decrease from $108,949,000 in 2023[56] - The company’s total liabilities amounted to $129,094,000, an increase from $119,899,000 in 2023, representing a 7.3% rise[56] Shareholder Information - As of June 30, 2024, Ng Khing Yeu holds 112,827,000 shares, representing 7.52% of the company's issued share capital[45] - Major shareholder Yutian holds 752,750,000 shares, accounting for 50.18% of the company's equity[49] - Ample Professional Limited has a pledged interest in 752,000,000 shares, which is approximately 50.13% of the equity[49] Debt and Financing - The company has overdue borrowings totaling approximately $54,683,000 in principal and $26,710,000 in interest as of June 30, 2024[69] - The company is actively negotiating with lenders regarding the extension and rescheduling of defaulted loans[72] - The ultimate holding company has agreed not to demand repayment of approximately $60,000,000 due on June 30, 2024, until the company is financially capable of repayment[72] - The company is exploring various financing options with different financial institutions to secure operational funding for the foreseeable future[72] Cost Management - Administrative expenses decreased by 21.1% to approximately $1.2 million, primarily due to reduced labor costs[20] - The company is implementing cost control measures, including optimizing human resources and adjusting management salaries[72] - Employee costs decreased from $696,000 in 2023 to $617,000 in 2024, a reduction of 11.3%[91] - The company recorded a significant decrease in inventory costs from $13,018,000 in 2023 to $4,986,000 in 2024, a decline of 61.7%[91] Corporate Governance - The company established a Remuneration Committee consisting of two independent non-executive directors and one executive director to oversee the remuneration policies and structures for all directors and senior management[44] - The Nomination Committee, consisting of one executive director and two independent non-executive directors, is responsible for identifying suitable candidates for the board[44] - The company believes that all independent non-executive directors are independent[44] - The company is committed to establishing transparent procedures for remuneration policies to ensure fairness and market competitiveness[44]