（於開曼群島註冊成立的有限公司） （股份代號：2135） 盈利警告 本公告乃由瑞麗醫美國際控股有限公司（「本公司」，連同其附屬公司統稱「本集團」） 根據香港聯合交易所有限公司證券上市規則（「上市規則」）第13.09條及香港法例 第571章證券及期貨條例第XIVA部項下之內幕消息條文（定義見上市規則）而作出。 本公司董事（「董事」）會（「董事會」）謹此通知本公司股東及有意投資者，根據對 本集團截至2025年6月30日止六個月未經審核綜合管理賬目（「未經審核管理賬目」） 的初步評估及董事會目前可獲得之資料，董事會預期本集團將錄得： 董事會認為，虧損乃主要由於以下原因： 香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示，概不就因本公告全部或任 何部分內容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。 Raily Aesthetic Medicine International Holdings Limited 瑞麗醫美國際控股有限公司 (c) 為了加快本集團的醫療器械產品研發及生產，本集團加大對本公司間接非全 資附屬公司蘇州瑞泉生物醫藥科 ...

FF301 致：香港交易及結算所有限公司 公司名稱: 瑞麗醫美國際控股有限公司(於開曼群島註冊成立的有限公司) 呈交日期: 2025年8月5日 I. 法定/註冊股本變動 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 | 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) | 02135 | 說明 | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | 法定/註冊股本 | | | 上月底結存 | | | 1,000,000,000 | USD | | 0.05 USD | | 50,000,000 | | 增加 / 減少 (-) | | | 0 | | | USD | | 0 | | 本月底結存 | | | 1,000,000,000 | USD | | 0.05 USD | | 50,000,000 | ...

Group 1 - The core viewpoint of the news highlights the recent performance of Rui Li Medical Beauty, which saw a stock price increase of 9.32% despite a cumulative decline of 6.35% over the past month, while the Hang Seng Index dropped by 1.6% [1][2] - Financial data indicates that Rui Li Medical Beauty achieved total revenue of 199 million yuan, a year-on-year increase of 5.26%, but reported a net loss of 59.21 million yuan, a significant decrease of 82.43% compared to the previous year [2] - The company's gross profit margin stands at 35.82%, with a debt-to-asset ratio of 61.78% [2] Group 2 - Currently, there are no institutional investment ratings for Rui Li Medical Beauty, and its price-to-earnings ratio is -1.03, ranking 101st in the healthcare equipment and services industry, which has an average TTM P/E ratio of -1.13 [3] - The company operates as a leading medical beauty service provider in Zhejiang, China, offering a wide range of services including cosmetic surgery, minimally invasive beauty services, and skin beauty services, along with consulting services for third-party medical beauty institutions [4] - Rui Li Medical Beauty has expanded its service network over 14 years, operating four private profit-making medical beauty service institutions in China, with over 30 practicing physicians averaging more than ten years of industry experience [4]

Company Overview - Rui Li Medical Beauty International Holdings Limited is a leading provider of medical beauty services in Zhejiang Province, China, focusing on meeting diverse customer needs in beauty and anti-aging [4] - The company offers a wide range of medical beauty services, including surgical beauty services, minimally invasive beauty services, and skin beauty services, as well as management consulting services for third-party medical beauty institutions [4] - Rui Li Medical has expanded into the sales network of medical beauty equipment, focusing on surgical implants and skincare products [4] Financial Performance - As of December 31, 2024, Rui Li Medical achieved total revenue of 199 million yuan, representing a year-on-year growth of 5.26% [2] - The company reported a net profit attributable to shareholders of -59.21 million yuan, a significant decrease of 82.43% year-on-year [2] - The gross profit margin stood at 35.82%, while the debt-to-asset ratio was 61.78% [2] Market Position and Valuation - Over the past month, Rui Li Medical has experienced a cumulative decline of 10.24%, while year-to-date, it has seen a cumulative increase of 6.54%, underperforming the Hang Seng Index's increase of 25.27% [2] - Currently, there are no institutional investment ratings for Rui Li Medical, and its price-to-earnings ratio is -0.99, ranking 101st in the industry [3] - The average price-to-earnings ratio for the healthcare equipment and services industry is -1.96, with a median of 1.36 [3]

Business Development and Partnerships - The company has established a 15-year supply agreement with Suneva Medical, Inc. for the Belotero product line, granting exclusive distribution rights in Greater China[7] - A 15-year supply agreement was reached with Suneva Medical, Inc. for the sale of Belifil collagen products in January 2024[18] - The company has entered into a supply agreement for the acquisition of distribution rights for the Belifill product and Suneva equity[82] - The company has entered into a conditional agreement to acquire up to 9.0% equity in Hangzhou Tianxin Medical Beauty Hospital for a maximum consideration of RMB 25.0 million[81] Financial Performance - The company achieved total revenue of approximately RMB 199.3 million for the year ended December 31, 2024, representing a year-on-year increase of 5.3% compared to RMB 189.4 million in 2023[21] - The gross profit margin for 2024 was approximately 35.8%, down from 37.8% in 2023, with the gross profit margin for medical beauty device sales at 65.9%, down from 75.6% in 2023[21] - The company reported a net loss of approximately RMB 63.3 million for the year, compared to a net loss of RMB 37.8 million in 2023, with a loss attributable to shareholders of approximately RMB 59.2 million, up from RMB 32.5 million in 2023[21] - The company's total revenue for 2024 is approximately RMB 199.3 million, representing a 5.3% increase from RMB 189.4 million in 2023[32] - Revenue from medical beauty services was approximately RMB 142.1 million in 2024, a decrease of 18.8% from RMB 174.9 million in 2023[53] - Revenue from medical beauty equipment products reached RMB 57.2 million in 2024, a significant increase from RMB 14.5 million in 2023[32] Market Trends and Growth Potential - Revenue from minimally invasive medical beauty services is showing significant growth, reflecting higher market demand[7] - The market for non-surgical medical beauty procedures is expected to grow steadily, with increasing penetration rates in China[20] - The domestic market for skin fillers, particularly collagen fillers, shows significant growth potential due to the increasing demand for anti-aging solutions[28] - The company recognizes the growing consumer interest in light medical beauty and anti-aging treatments, which are becoming increasingly popular due to their affordability and minimally invasive nature[101] Research and Development - The company is actively developing new skin injection filler products in collaboration with renowned domestic universities, aiming to enhance its product offerings[7] - The company is increasing investment in research and development for new medical beauty devices, aiming to cover the entire industry chain from downstream to upstream[22] - The company is accelerating the research and development of its collagen injection products, with an investment of approximately RMB 4.5 million in 2024[34] - The company plans to focus on developing non-surgical medical beauty services, increasing investment in technology and research, and enhancing sales and R&D of three categories of medical beauty equipment[101] Operational Efficiency and Strategy - The company aims to optimize its sales network by increasing the number of direct sales teams and agents, with a focus on improving operational efficiency[27] - The company plans to enhance its non-surgical service offerings, focusing on minimally invasive procedures that are gaining popularity among consumers[35] - The company is considering strategic acquisitions of medical beauty institutions or medical device companies to strengthen its market position[41] - The company plans to expand its medical beauty institution network, allocating 71.0% of the net proceeds amounting to HKD 58.0 million, with HKD 49.4 million already utilized and HKD 8.6 million expected to be used by 2025[89] Governance and Compliance - The company has adopted the corporate governance code as per the listing rules, ensuring compliance with all applicable provisions during the year[123][124] - The board consists of three executive directors and three independent non-executive directors, promoting a balanced composition for effective oversight[130] - The company emphasizes a strong corporate culture and values, focusing on ethical business practices and sustainable development to attract and retain talent[125] - The company will conduct annual reviews of its internal controls and compliance systems to prevent future regulatory breaches[98] Employee and Stakeholder Engagement - The company has committed to competitive compensation and professional development for its medical staff, with annual performance reviews influencing salary and bonus determinations[87] - The company emphasizes two-way communication with shareholders and has established various channels for transparent information dissemination[185] - The performance bonus structure is based on both company and individual performance metrics[186] - The company has appointed a dedicated investor relations team to facilitate communication with shareholders and investors, emphasizing the importance of feedback for strategic development[103] Environmental, Social, and Governance (ESG) Initiatives - The ESG report covers the company's performance in sustainability, environmental protection, employee care, and corporate responsibility for the year 2024[196] - The company has established policies related to environmental, social, and corporate governance responsibilities to enhance its ESG governance[200] - The company is committed to understanding stakeholder expectations and concerns regarding ESG issues to optimize its governance and performance[200] - The company has implemented appropriate ESG risk management measures and internal control systems to address potential ESG risks effectively[200]

Financial Performance - Revenue for the year ended December 31, 2024, was RMB 199,342,000, representing an increase of 5.2% from RMB 189,384,000 in 2023[4] - Gross profit for the same period was RMB 71,407,000, slightly down from RMB 71,493,000 in 2023, indicating a marginal decrease of 0.12%[4] - The company reported a net loss of RMB 63,263,000 for the year, compared to a net loss of RMB 37,779,000 in 2023, reflecting an increase in losses of 67.5%[4] - The basic and diluted loss per share for the year was RMB 0.1111, compared to RMB 0.0675 in 2023, indicating a worsening of 64.4%[4] - The adjusted loss before tax was RMB (15,330) thousand, a 33.9% improvement from RMB (23,200) thousand in 2023[53] - The adjusted net loss for the year was RMB (18,762) thousand, a 27.8% improvement from RMB (25,969) thousand in 2023[53] - The group reported a pre-tax loss of RMB 65,257,000 for 2024, compared to a pre-tax loss of RMB 35,010,000 in 2023, indicating a significant increase in losses[33] Assets and Liabilities - Total current assets increased to RMB 90,434,000 from RMB 79,616,000, marking an increase of 13.4%[5] - Total non-current assets decreased to RMB 159,489,000 from RMB 193,983,000, a decline of 17.8%[5] - The company's total liabilities increased to RMB 154,405,000 from RMB 141,009,000, an increase of 9.5%[6] - The equity attributable to the owners of the parent company decreased to RMB 104,134,000 from RMB 138,115,000, a decline of 24.6%[6] - As of December 31, 2024, cash and bank balances were approximately RMB 289 million, down from RMB 398 million in 2023, primarily due to costs incurred for acquiring distribution rights for collagen injection products[79] - The total debt as of December 31, 2024, was approximately RMB 1,544 million, with a debt-to-equity ratio of approximately 161.7%, up from 106.3% in 2023[87] Revenue Segmentation - Medical beauty services generated RMB 142,097 thousand in revenue for 2024, down from RMB 174,910 thousand in 2023, indicating a decline of about 18.8%[25] - Medical beauty device products saw a significant increase in revenue, rising to RMB 57,216 thousand in 2024 from RMB 14,474 thousand in 2023, marking a growth of approximately 295.5%[25] - The consulting services segment contributed RMB 29 thousand in revenue for 2024, compared to no revenue reported in 2023[25] - Revenue from surgical services fell to approximately RMB 4.1 million in 2024, a decline of 41.3% from RMB 6.9 million in 2023, attributed to changing consumer preferences[63] - Revenue from medical beauty device sales surged by 295.3% to approximately RMB 57.2 million in 2024, compared to RMB 14.5 million in 2023[61] Expenses and Costs - Research and development expenses decreased to RMB 717,000 from RMB 1,602,000, a reduction of 55.2%[4] - Capital expenditures for the year 2024 totaled RMB 43,650 thousand, which included investments in property, plant, equipment, and intangible assets[23] - The company reported a total employee cost of approximately RMB 66.7 million for the year, a decrease of RMB 2.1 million compared to RMB 68.8 million in 2023, representing 33.5% of total revenue for 2024[96] - Administrative expenses in 2024 were approximately RMB 418 million, an increase of RMB 17 million from RMB 401 million in 2023, mainly due to increased share-based payment expenses[75] - Sales and distribution expenses in 2024 were approximately RMB 477 million, a decrease of about 8.8% from RMB 523 million in 2023, attributed to restructuring the marketing system[74] Strategic Plans and Developments - The company plans to apply the new and revised International Financial Reporting Standards (IFRS) upon their effective date, which includes IFRS 18, IFRS 19, and amendments to IFRS 9 and IFRS 7[12][13][14][17]. - The company plans to enhance non-surgical service capacity by introducing the latest medical beauty technologies and increasing investment in minimally invasive and skin beauty services[44] - The company plans to establish a medical beauty training center in Hainan, enhancing the professional level of doctors and improving service quality[47] - The company aims to expand its sales channels through digital marketing and partnerships with suppliers and distributors to enhance operational efficiency[48] - The company is considering strategic acquisitions of suitable medical beauty institutions or medical device companies to strengthen its market position[50] Compliance and Governance - The audit committee has reviewed and approved the annual performance of the group, ensuring compliance with applicable accounting standards and regulations[119] - The company has acknowledged a compliance oversight regarding the announcement of supply agreements and service agreements, committing to enhance training and internal controls to prevent future occurrences[109] - The company has established a competitive compensation structure for its medical staff, with annual performance reviews influencing salary and bonus determinations[98] Market Trends - The medical beauty industry is shifting from niche to mass consumption, driven by rising consumer awareness and the popularity of non-surgical procedures[112] - The company plans to focus on developing non-surgical medical beauty services and increase investment in technology and research[112]

[Company Information](index=2&type=section&id=Company%20Information) The company is incorporated in the Cayman Islands, headquartered in Hangzhou, China, with a stock code of 2135 - Ruili Medical Aesthetics International Healthcare Holdings Limited is a company incorporated in the Cayman Islands with stock code **2135**, headquartered in Hangzhou, China, and a principal place of business in Hong Kong[9](index=9&type=chunk)[10](index=10&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the company's operational performance, financial results, and strategic initiatives during the reporting period [Business Review](index=4&type=section&id=Business%20Review) As a leading medical aesthetic service provider in the Yangtze River Delta, the Group achieved a 20.4% increase in total revenue in H1 2024, driven by strong sales of medical aesthetic device products, while narrowing net loss Key Performance Indicators for H1 2024 | Indicator | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Total Revenue | Approx. **RMB 117,500 thousand** | Approx. **RMB 97,600 thousand** | +20.4% | | Loss for the Period | Approx. **RMB 3,000 thousand** | Approx. **RMB 4,100 thousand** | -26.8% | | Loss Attributable to Owners of the Parent | Approx. **RMB 1,600 thousand** | Approx. **RMB 2,300 thousand** | -30.4% | | Active Customers | Approx. **31,700 persons** | Approx. **31,100 persons** | +1.9% | | New Customers | Approx. **12,100 persons** | Approx. **12,600 persons** | -4.1% | | Repeat Customers | Approx. **19,600 persons** | Approx. **18,500 persons** | +5.9% | | Average Spending per Customer | Approx. **RMB 2,621** | Approx. **RMB 2,978** | -13.6% | - The company's strategic focus shifted to non-surgical procedures, transitioning medical aesthetic device product sales from surgical implants to higher-demand dermal injectable products like collagen, with collagen injectable product sales reaching approximately **RMB 25.2 million** in May and June 2024[14](index=14&type=chunk) - To optimize resources and save expenses, the company merged the business of Hangzhou Beilifeier Medical Aesthetic Clinic into the Hangzhou Ruili Medical Aesthetic Hospital flagship store[11](index=11&type=chunk) [Financial Review](index=7&type=section&id=Financial%20Review) In H1 2024, total revenue grew 20.4% to RMB 117.5 million, driven by a 176.7% surge in medical aesthetic device product sales, while core medical aesthetic services revenue declined 2.5% due to intense competition and lower average spending [Revenue Analysis](index=7&type=section&id=Revenue%20Analysis) Total revenue increased by 20.4%, primarily driven by a 176.7% surge in medical aesthetic device product sales to RMB 34.4 million, while medical aesthetic services revenue, accounting for 70.7% of total, decreased by 2.5% Revenue by Service Segment (Six Months Ended June 30) | Service Segment | 2024 Revenue (RMB thousands) | Proportion (%) | 2023 Revenue (RMB thousands) | Proportion (%) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Medical Aesthetic Services** | **83,026** | **70.7** | **85,139** | **87.3** | **(2.5)** | | - Surgical Aesthetic Services | 2,586 | 2.2 | 3,791 | 3.9 | (31.8) | | - Minimally Invasive Aesthetic Services | 40,134 | 34.2 | 43,504 | 44.6 | (7.7) | | - Dermatology Aesthetic Services | 39,772 | 33.9 | 36,296 | 37.2 | 9.6 | | **Medical Aesthetic Device Product Sales** | **34,420** | **29.3** | **12,441** | **12.7** | **176.7** | | **Total** | **117,475** | **100.0** | **97,580** | **100.0** | **20.4** | [Cost of Sales Analysis](index=8&type=section&id=Cost%20of%20Sales%20Analysis) Cost of sales increased by 17.9% to RMB 69 million, mainly due to a 303.7% surge in cost of inventories sold, driven by the significant growth in medical aesthetic device product sales Cost of Sales by Nature (Six Months Ended June 30) | Cost Nature | 2024 (RMB thousands) | Proportion (%) | 2023 (RMB thousands) | Proportion (%) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Cost of Consumables Used | 36,639 | 53.1 | 33,629 | 57.4 | 9.0 | | Cost of Inventories Sold | 10,311 | 14.9 | 2,554 | 4.4 | 303.7 | | Staff Costs | 14,638 | 21.2 | 14,241 | 24.3 | 2.8 | | Others | 7,420 | 10.8 | 8,127 | 13.9 | (8.7) | | **Total** | **69,008** | **100.0** | **58,551** | **100.0** | **17.9** | [Gross Profit Analysis](index=9&type=section&id=Gross%20Profit%20Analysis) Total gross profit increased by 24.2% to RMB 48.5 million, with the overall gross profit margin slightly rising to 41.3%, primarily driven by a 143.8% increase in gross profit from medical aesthetic device product sales Gross Profit and Gross Margin by Service (Six Months Ended June 30) | Service Segment | 2024 Gross Profit (RMB thousands) | 2024 Gross Margin (%) | 2023 Gross Profit (RMB thousands) | 2023 Gross Margin (%) | Gross Profit Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Medical Aesthetic Services | 24,329 | 29.3 | 29,142 | 34.2 | (16.5) | | Medical Aesthetic Device Product Sales | 24,109 | 70.0 | 9,887 | 79.5 | 143.8 | | **Total** | **48,467** | **41.3** | **39,029** | **40.0** | **24.2** | [Expenses, Profitability, and Liquidity](index=10&type=section&id=Expenses%2C%20Profitability%2C%20and%20Liquidity) Other income and gains significantly increased to RMB 10 million, mainly from fair value gains on contingent consideration, while the company's net current liabilities expanded to RMB 38.9 million at period-end - Other expenses significantly increased, primarily due to the recognition of an **RMB 13.3 million** impairment loss on intangible assets during the reporting period[25](index=25&type=chunk) Key Financial Position (June 30, 2024) | Indicator | Amount (RMB) | | :--- | :--- | | Cash and Bank Balances | **RMB 34.8 million** | | Net Current Liabilities | **RMB 38.9 million** | | Unutilized Bank Facilities | **RMB 15 million** | | Interest-bearing Bank Borrowings | **RMB 15 million** | | Gearing Ratio | **115.8%** | [Employees and Remuneration Policy](index=12&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2024, the company had 321 employees in China, a decrease from 335 at the end of 2023, with total staff costs of approximately RMB 34.7 million, representing 29.6% of total revenue Employee Headcount Structure | Function | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Management | 5 | 6 | | Doctors and Medical Staff | 131 | 124 | | Sales, Marketing, Customer Service, and Other Business Personnel | 139 | 167 | | Finance and Administrative Personnel | 46 | 38 | | **Total** | **321** | **335** | - Total staff costs during the reporting period were approximately **RMB 34.7 million** (including **RMB 3.7 million** in share option expenses), accounting for **29.6%** of total revenue, lower than **33.6%** in the same period last year[31](index=31&type=chunk) [Use of Proceeds](index=13&type=section&id=Use%20of%20Proceeds) The company disclosed the use of proceeds from its 2020 IPO and 2024 rights issue, with HKD 9.5 million from the IPO for organic development and HKD 7.6 million from the rights issue for medical device registration still unutilized Use of Net Proceeds from IPO (As of June 30, 2024) | Purpose | Planned Use (HKD millions) | Actual Use (HKD millions) | Unutilized (HKD millions) | | :--- | :--- | :--- | :--- | | Expansion of Medical Aesthetic Institution Network | 58.0 | 48.5 | 9.5 | | Purchase of New Equipment and Consumables | 9.0 | 9.0 | – | | Brand Promotion | 6.5 | 6.5 | – | | General Working Capital | 8.2 | 8.2 | – | | **Total** | **81.7** | **72.2** | **9.5** | Use of Net Proceeds from 2024 Rights Issue (As of June 30, 2024) | Purpose | Planned Use (HKD millions) | Actual Use (HKD millions) | Unutilized (HKD millions) | | :--- | :--- | :--- | :--- | | Purchase of Equipment and Raw Materials | 9.5 | 9.5 | – | | Medical Device Product Registration and Filing | 7.6 | – | 7.6 | | General Working Capital | 1.9 | 1.9 | – | | **Total** | **19.0** | **11.4** | **7.6** | [Outlook](index=14&type=section&id=Outlook) The company anticipates continued expansion in the medical aesthetics market, particularly in non-surgical procedures, and plans to focus on developing personalized, customized services and products to meet diverse consumer demands - The company believes non-surgical medical aesthetic procedures will continue to rapidly gain market share due to their minimal invasiveness, quick recovery, and low risk, with skin management and anti-aging being the largest sub-segments in demand[38](index=38&type=chunk) - The future trend will be personalized and customized medical aesthetic services, with the company planning to introduce more distinctive services and products through refined management to meet diverse consumer needs[39](index=39&type=chunk) [Corporate Governance and Other Information](index=15&type=section&id=Corporate%20Governance%20and%20Other%20Information) This section details the company's corporate governance practices, including director and major shareholder interests, share option schemes, and significant events during the reporting period [Directors' and Major Shareholders' Interests](index=15&type=section&id=Directors%27%20and%20Major%20Shareholders%27%20Interests) As of June 30, 2024, Mr. Fu Haishu, Chairman, held 53.10% of the total issued shares through his wholly-owned company, Ruide Consulting Management Limited, making him the controlling shareholder Major Shareholders' Shareholding | Name/Entity | Capacity/Nature of Interest | Number of Shares Held | Proportion | | :--- | :--- | :--- | :--- | | Mr. Fu Haishu | Interest in controlled corporation | 295,808,923 | 53.10% | | Ruide Consulting Management Limited | Beneficial owner | 295,808,923 | 53.10% | [Share Option Scheme](index=18&type=section&id=Share%20Option%20Scheme) During the reporting period, the company granted 96,060,928 new share options and 47,430,466 options lapsed, with 158,223,563 options remaining unexercised at period-end Summary of Share Option Scheme Movements | Item | Number of Share Options | | :--- | :--- | | Unexercised at Beginning of Period | 156,869,538 | | Granted During the Period | 96,060,928 | | Lapsed During the Period | 47,430,466 | | Exercised During the Period | – | | Cancelled During the Period | – | | **Unexercised at End of Period** | **158,223,563** | [Significant Events During the Reporting Period](index=19&type=section&id=Significant%20Events%20During%20the%20Reporting%20Period) In H1 2024, the company completed a 5-for-1 share consolidation in March and a 1-for-3 rights issue in April, raising approximately HKD 19 million in net proceeds for equipment purchases and medical device registration - The company completed a share consolidation on March 19, 2024, consolidating every five existing shares into one[49](index=49&type=chunk) - The company completed a rights issue on April 25, 2024, issuing approximately **139 million** new shares and raising net proceeds of approximately **HKD 19 million**, allocated for purchasing production equipment and raw materials (**50%**), medical device product registration (**40%**), and general working capital (**10%**)[52](index=52&type=chunk) [Independent Review Report](index=22&type=section&id=Independent%20Review%20Report) This section presents the auditor's conclusion on the interim financial information, confirming its compliance with relevant accounting standards [Conclusion of Review](index=22&type=section&id=Conclusion%20of%20Review) Ernst & Young, the auditor, conducted a review of the Group's interim financial information and found no matters indicating non-compliance with International Accounting Standard 34 - Ernst & Young, the auditor, issued a standard unqualified review conclusion, stating that the interim financial information complies in all material respects with relevant accounting standards[57](index=57&type=chunk) [Interim Condensed Consolidated Financial Statements](index=22&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) This section provides the condensed consolidated financial statements, including the statement of profit or loss, financial position, and cash flows, offering a summary of the company's financial performance and health [Statement of Profit or Loss and Other Comprehensive Income](index=22&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2024, the company reported revenue of RMB 117.5 million, a 20.4% increase, and a narrowed loss for the period of RMB 3 million, with basic loss per share of RMB 0.32 cents Summary of Consolidated Statement of Profit or Loss for H1 2024 | Item (RMB thousands) | 2024 (Unaudited) | 2023 (Unaudited) | | :--- | :--- | :--- | | Revenue | 117,475 | 97,580 | | Gross Profit | 48,467 | 39,029 | | Loss Before Tax | (2,257) | (2,796) | | Loss for the Period | (2,997) | (4,096) | | Loss Attributable to Owners of the Parent | (1,617) | (2,255) | | Basic Loss Per Share (RMB cents) | (0.32) | (0.47) | [Statement of Financial Position](index=23&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2024, total assets were RMB 324.9 million, with non-current assets significantly increasing, but current liabilities exceeded current assets by RMB 38.9 million, indicating short-term liquidity pressure Summary of Consolidated Statement of Financial Position | Item (RMB thousands) | June 30, 2024 (Unaudited) | December 31, 2023 (Audited) | | :--- | :--- | :--- | | Total Non-Current Assets | 226,006 | 193,983 | | Total Current Assets | 98,884 | 79,616 | | **Total Assets** | **324,890** | **273,599** | | Total Current Liabilities | 137,761 | 92,159 | | Total Non-Current Liabilities | 36,581 | 48,850 | | **Total Liabilities** | **174,342** | **141,009** | | **Net Assets** | **150,548** | **132,590** | | Net Current (Liabilities)/Assets | (38,877) | (12,543) | [Statement of Cash Flows](index=26&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) In H1 2024, net cash generated from operating activities was RMB 2.04 million, significantly lower than the prior period, while financing activities provided RMB 19.68 million, resulting in a period-end cash balance of RMB 34.48 million Summary of Consolidated Statement of Cash Flows (Six Months Ended June 30) | Item (RMB thousands) | 2024 (Unaudited) | 2023 (Unaudited) | | :--- | :--- | :--- | | Net Cash Flows from Operating Activities | 2,043 | 6,986 | | Net Cash Flows Used in Investing Activities | (3,307) | (30,022) | | Net Cash Flows from Financing Activities | 19,684 | 1,384 | | **Net Increase/(Decrease) in Cash and Cash Equivalents** | **18,420** | **(21,652)** | | Cash and Cash Equivalents at Beginning of Period | 15,930 | 43,937 | | **Cash and Cash Equivalents at End of Period** | **34,476** | **22,906** | [Notes to the Financial Statements](index=29&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section provides detailed explanatory notes to the interim condensed consolidated financial statements, covering operating segments, intangible assets, and events after the reporting period [Operating Segment Information](index=30&type=section&id=Operating%20Segment%20Information) The company operates in medical aesthetic services, consulting services, and medical aesthetic device products, with the latter showing significant revenue growth and segment profit, while medical aesthetic services shifted from profit to loss Summary of Segment Results (Six Months Ended June 30, 2024) | Segment (RMB thousands) | Segment Revenue | Segment Results | | :--- | :--- | :--- | | Medical Aesthetic Services | 83,026 | (2,983) | | Consulting Services | 29 | (364) | | Medical Aesthetic Device Products | 36,625 | 14,439 | [Intangible Assets](index=39&type=section&id=Intangible%20Assets) During the reporting period, the company acquired a 15-year distribution right for RMB 44.79 million, significantly increasing intangible assets, but also recognized an RMB 13.28 million impairment loss on an exclusive distributor agreement due to a subsidiary's declining performance - The Group acquired a 15-year distribution right at a cost of **RMB 44.792 million** by signing a purchase and sales agreement with a Class III medical device supplier[83](index=83&type=chunk) - An impairment loss of **RMB 13.279 million** was recognized on the intangible asset related to the exclusive distributor agreement due to the declining performance of Jiumei Xinhe[83](index=83&type=chunk) [Events After the Reporting Period](index=45&type=section&id=Events%20After%20the%20Reporting%20Period) On August 13, 2024, the company terminated a proposed capital injection plan with Hangzhou Tianxin Medical Aesthetic Hospital Co., Ltd., and is set to recover an earnest money deposit of RMB 20 million - The company terminated its capital injection plan for Hangzhou Tianxin Medical Aesthetic Hospital Co., Ltd. on August 13, 2024, and will recover an earnest money deposit of **RMB 20 million**[97](index=97&type=chunk)

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 117,475,000, representing a 20.3% increase from RMB 97,580,000 in the same period of 2023[2] - Gross profit for the same period was RMB 48,467,000, up 24.1% from RMB 39,029,000 year-on-year[2] - The company reported a net loss of RMB 2,997,000 for the six months ended June 30, 2024, an improvement from a net loss of RMB 4,096,000 in the prior year[2] - Basic and diluted loss per share decreased to RMB 0.32 from RMB 0.47 year-on-year[2] - The group reported a loss before tax of RMB 2,257 thousand for the six months ended June 30, 2024, compared to a loss of RMB 2,796 thousand for the same period in 2023, showing an improvement in financial performance[10] - The total loss for the reporting period was approximately RMB 3.0 million, compared to a loss of RMB 4.1 million for the six months ended June 30, 2023. The loss attributable to the parent company was about RMB 1.6 million, down from RMB 2.3 million in the previous period[52] Revenue Breakdown - Revenue from medical beauty services was RMB 83,026 thousand for the six months ended June 30, 2024, compared to RMB 85,139 thousand in the same period of 2023, indicating a slight decline of about 2.5%[13] - Revenue from medical beauty equipment products increased significantly to RMB 34,420 thousand for the six months ended June 30, 2024, up from RMB 12,441 thousand in the same period of 2023, reflecting a growth of approximately 176.5%[13] - Revenue from service offerings was RMB 83,055,000, while revenue from medical device products was RMB 34,420,000 for the six months ended June 30, 2024[14] - Revenue from medical beauty services was approximately RMB 83.0 million, a decrease of about 2.5% from RMB 85.1 million for the six months ended June 30, 2023, due to a decline in average transaction value amid intense industry competition[41] - Revenue from the sale of medical beauty equipment was approximately RMB 34.4 million, a significant increase of about 176.7% compared to RMB 12.4 million for the six months ended June 30, 2023, attributed to the introduction of high-priced collagen injection products[41] Assets and Liabilities - Total non-current assets as of June 30, 2024, amounted to RMB 226,006,000, an increase from RMB 193,983,000 as of December 31, 2023[3] - Current assets totaled RMB 98,884,000 as of June 30, 2024, compared to RMB 79,616,000 at the end of 2023, reflecting a 24.1% increase[3] - Current liabilities increased to RMB 137,761,000 from RMB 92,159,000, resulting in a net current liability of RMB 38,877,000[3] - The total assets of the group as of June 30, 2024, were RMB 324,890 thousand, an increase from RMB 273,599 thousand as of December 31, 2023, representing a growth of about 18.8%[12] - The total liabilities of the group as of June 30, 2024, were RMB 174,342 thousand, compared to RMB 141,009 thousand as of December 31, 2023, indicating an increase of approximately 23.6%[12] - The total debt was approximately RMB 174.3 million as of June 30, 2024, resulting in a debt-to-equity ratio of approximately 115.8%, up from 106.3% as of December 31, 2023[59] Operational Expenses - The company incurred research and development expenses of RMB 446,000 during the reporting period[2] - The company experienced a significant increase in employee benefits expenses, totaling RMB 26,487,000 for wages and salaries, compared to RMB 25,814,000 in the previous year[17] - Selling and distribution expenses were approximately RMB 23.7 million, an increase of about RMB 0.9 million compared to RMB 22.8 million for the six months ended June 30, 2023[47] - Administrative expenses were approximately RMB 20.2 million, up from approximately RMB 18.5 million for the six months ended June 30, 2023, primarily due to increased employee costs related to managing medical beauty equipment products[48] - The group’s total unallocated expenses were RMB 11,878 thousand for the six months ended June 30, 2024, compared to RMB 10,636 thousand for the same period in 2023, reflecting an increase in operational costs[10] Strategic Developments - The company acquired distribution rights for RMB 44.79 million through a 15-year agreement with a Class III medical device supplier[24] - The company has established a medical technology exchange platform and a medical technology experience learning center in collaboration with the Hainan Boao Lecheng International Medical Tourism Pilot Zone Management Bureau[34] - The company is actively developing a research and manufacturing platform for advanced medical beauty device products, with a factory area of approximately 4,660 square meters dedicated to skin injection products[38] - The company aims to enhance the training center's role by providing a platform for medical device manufacturers to showcase their products and developing high-quality courses for domestic medical beauty practitioners[35] - The company has shifted its focus from surgical implants to skin injection products in response to market changes, indicating a strategic diversification in its medical beauty device offerings[36] - The company plans to continue collaborating with renowned domestic universities to strengthen its position as a leading supplier of non-surgical medical beauty service products[38] Market Trends - The medical beauty market is expected to grow, driven by increasing consumer demand and the rise of non-surgical procedures, particularly in skin management and anti-aging[69] - The company emphasizes personalized medical beauty services as a future trend, focusing on quality management and tailored solutions for consumers[69] Corporate Governance - The company has adhered to corporate governance principles, ensuring transparency and accountability throughout the reporting period[72] - The company has not declared any interim dividends during the reporting period[70] Shareholder Actions - The company granted stock options to qualified individuals for a total of 48,630,462 shares, representing approximately 2.33% of the issued share capital as of January 26, 2024[75] - A second grant of stock options for 47,430,466 shares was made on February 23, 2024, accounting for about 2.27% of the issued share capital[75] - The board proposed a share consolidation of one share for every five existing shares, which was approved at the special general meeting on March 15, 2024[76] - The company plans to raise up to approximately HKD 20.8 million through a rights issue, with net proceeds expected to be around HKD 19.0 million after expenses[76] - Of the net proceeds, approximately HKD 9.5 million (50.0%) will be used for purchasing equipment and raw materials, HKD 7.6 million (40.0%) for regulatory registration of medical beauty devices, and HKD 1.9 million (10.0%) for general working capital[76]

Business Operations - The flagship store, Hangzhou Ruile Medical Beauty Hospital, was re-evaluated as a "5A" level medical beauty institution in December 2023, indicating its leading position in management, patient safety, clinical technology, and service quality[4]. - The company operates five private profit-making medical beauty institutions, with three located in Zhejiang Province, one in Anhui Province, and one in Hainan Province[4]. - The factory for skin injection products, located in Suzhou, covers an area of approximately 4,660 square meters and is currently in the trial production phase for injection samples[5]. - The company has established partnerships with well-known domestic universities to jointly develop new skin injection products, aiming to strengthen its position as a leading supplier of non-surgical medical beauty services[5]. - Medical beauty services include surgical, minimally invasive, and skin beauty services, with a focus on enhancing aesthetic appeal and reducing recovery time[6][8][9]. - The company provides dental beauty services, including orthodontics, dental implants, and teeth whitening, enhancing customer experience and retention through cross-selling[10]. - The company offers medical beauty management consulting services, leveraging its experience in managing medical beauty institutions and expertise in sales and marketing[11]. Financial Performance - The company achieved a total revenue of approximately RMB 189.4 million for the year ended December 31, 2023, representing a year-on-year increase of 15.1% compared to RMB 164.5 million in 2022[24]. - The gross profit margin for 2023 was approximately 37.8%, down from 40.6% in 2022, with the dermatology segment's gross profit margin at 43.3% compared to 43.8% in the previous year[24]. - The company reported a net loss of approximately RMB 37.8 million for 2023, compared to a net loss of RMB 20.2 million in 2022, with a loss attributable to shareholders of RMB 32.5 million versus RMB 15.9 million in 2022[24]. - The company recorded a total comprehensive loss of approximately RMB 378 million in 2023, compared to a loss of RMB 202 million in 2022, with adjusted net loss of approximately RMB 189 million in 2023, up from RMB 99 million in 2022[75]. - The company reported a revenue of RMB 189.384 million for 2023, an increase of 15.1% compared to RMB 164.522 million in 2022[48]. - The gross profit for 2023 was RMB 71.493 million, reflecting a growth of 7.1% from RMB 66.783 million in the previous year[48]. - The pre-tax loss increased by 58.4% to RMB 35.010 million in 2023, compared to RMB 22.101 million in 2022[48]. Market Trends - The medical beauty market in China is projected to grow at a compound annual growth rate (CAGR) of 16.1% from 2021 to 2026, significantly outpacing the global market growth[23]. - The non-surgical medical beauty market accounted for 52% of the overall medical beauty market share in China in 2022, indicating a growing consumer preference[27]. - The domestic dermal filler market, including hyaluronic acid and polylactic acid, presents significant growth opportunities, particularly in collagen fillers[29]. - The online promotion trend in the medical beauty industry is expected to become a significant method for consumer engagement and service acquisition[32]. Customer Engagement - The number of active customers in the medical beauty segment rose by approximately 12.0% from about 49,900 in 2022 to around 55,900 in 2023[38]. - The average spending per customer increased by approximately 3.3%, from RMB 3,000 in 2022 to RMB 3,100 in 2023[38]. - The number of active customers for skin beauty services increased to 39,500 in 2023 from 32,600 in 2022, a growth of 21.5%[52]. Research and Development - The company plans to increase investment in R&D activities for new medical device products at its Suzhou facility[24]. - The research and development expenses for Suzhou Yonglan in 2023 amounted to approximately RMB 7.7 million, an increase from RMB 5.8 million in 2022[37]. - The company plans to focus on non-surgical medical beauty services and increase investment in technology and research to develop personalized anti-aging services and products[116]. Strategic Initiatives - The company is focusing on the sales of skin injection products such as collagen and hyaluronic acid fillers, with plans to conduct market research and establish a new sales network[13]. - The company aims to establish a nationwide sales network for medical beauty equipment through a distributor model[30]. - The company has established a strategic partnership with the Hainan Boao Lecheng International Medical Tourism Pilot Zone Management Bureau to build a medical beauty training center[20]. - A new medical technology exchange platform is being established in collaboration with the Hainan Boao Lecheng International Medical Tourism Pilot Zone Management Bureau[43]. Corporate Governance - The board consists of three executive directors and three independent non-executive directors, which is considered a balanced composition to enhance independent review and oversight[150]. - The company has adopted strict corporate governance principles to enhance transparency and accountability, aligning with the stock exchange's guidelines[143]. - The board has established a remuneration committee to review the compensation packages of senior management and directors for the year 2023[171]. - The company has established an internal audit department that reviewed the risk management and internal control systems at least once during the year[186]. Employee Management - As of December 31, 2023, the group has 335 employees in China, an increase from 322 employees as of December 31, 2022[101]. - Total employee cost for 2023 was approximately RMB 68.8 million, an increase of RMB 5.0 million from RMB 63.8 million in 2022, accounting for 36.3% of total revenue in 2023 (2022: 38.8%)[102]. - The company’s employee headcount increased from 322 in 2022 to 335 in 2023, with a notable rise in sales, marketing, and customer service personnel[102]. Future Outlook - The company provided a positive outlook for the next fiscal year, projecting a revenue growth of 10% to 12%[132]. - New product launches are expected to contribute an additional 5 million in revenue, with a focus on innovative medical beauty solutions[132]. - The company is expanding its market presence, targeting an increase in service locations by 25% over the next two years[132]. - A strategic acquisition is planned to enhance service offerings, with an estimated investment of 10 million[132]. Investor Relations - The company emphasizes maintaining high standards in investor relations to enhance shareholder value[119]. - The company has a dedicated investor relations team to facilitate communication with shareholders and potential investors[119]. - The company encourages feedback from investors to better formulate its development strategy[119].

Financial Performance - Total revenue for the year ended December 31, 2023, was RMB 189,384,000, an increase of 15.1% from RMB 164,522,000 in 2022[5] - Gross profit for the same period was RMB 71,493,000, representing a gross margin of 37.7%, compared to RMB 66,783,000 in 2022[5] - The company reported a net loss of RMB 37,779,000 for the year, which is a 86.3% increase from the net loss of RMB 20,247,000 in 2022[5] - The company reported a loss before tax of RMB 35,010 thousand for the year, compared to a loss of RMB 22,101 thousand in 2022[24] - The company recorded a total annual loss attributable to equity holders of approximately RMB 32.5 million in 2023, compared to RMB 15.9 million in 2022[45] - The company reported a basic loss per share of RMB 7.77 for 2023, compared to RMB 3.81 for 2022, indicating a significant increase in losses per share[39] - The group reported a pre-tax loss of RMB 35,010,000 for 2023, compared to a loss of RMB 22,101,000 in 2022, representing a year-over-year increase of 58.5% in losses[33] Revenue Breakdown - Revenue from medical beauty services reached RMB 174,910 thousand, up 15.3% from RMB 151,661 thousand in the previous year[25] - Revenue from medical beauty equipment products increased to RMB 14,474 thousand, a rise of 12.8% compared to RMB 12,834 thousand in 2022[25] - Revenue from minimally invasive beauty services and skin beauty services was approximately RMB 830 million and RMB 833 million, representing increases of 12.3% and 30.8% compared to 2022[72] - The revenue from cosmetic surgery services in 2023 was approximately RMB 69 million, a decrease of 33.3% from RMB 104 million in 2022, primarily due to technological advancements and changing consumer preferences[72] Expenses and Costs - Research and development expenses decreased to RMB 1,602,000 from RMB 2,000,000, indicating a focus on cost management[5] - The company recognized impairment losses of RMB 11,970 thousand, compared to RMB 6,378 thousand in the previous year[24] - The total sales cost for 2023 was approximately RMB 1,179 million, an increase of about 20.6% from RMB 977 million in 2022[73] - Selling and distribution expenses for 2023 were approximately RMB 523 million, up about 6.1% from RMB 493 million in 2022, mainly due to increased live-streaming promotion costs[83] - Administrative expenses for 2023 were approximately RMB 401 million, an increase of about RMB 42 million from RMB 359 million in 2022[84] Assets and Liabilities - Total assets as of December 31, 2023, amounted to RMB 273,599 thousand, down from RMB 302,651 thousand in 2022[24] - Total liabilities increased to RMB 141,009 thousand, compared to RMB 136,774 thousand in the previous year[24] - Total current liabilities increased to RMB 92,159,000 from RMB 76,413,000, indicating a rise in short-term financial obligations[6] - The company's equity attributable to owners of the parent decreased to RMB 138,115,000 from RMB 166,080,000, reflecting a decline in shareholder value[7] - The total debt of the group as of December 31, 2023, was approximately RMB 141.0 million, compared to RMB 136.8 million as of December 31, 2022, resulting in a debt-to-equity ratio of approximately 106.3%, up from 82.5% in the previous year[96] Cash Flow and Liquidity - Cash and bank balances decreased significantly to RMB 39,790,000 from RMB 78,779,000, reflecting liquidity challenges[6] - The group has established a cautious treasury policy, continuously assessing the financial status of clients to mitigate credit risk and closely monitoring liquidity to meet funding needs[99] Strategic Plans and Market Position - The company plans to focus on expanding its medical beauty services and product offerings in the coming year[24] - The company aims to increase market share for its medical beauty equipment products by enhancing sales networks and investing in new product development[57] - The company plans to allocate approximately 40% of the net proceeds from the share offering for the registration of medical beauty devices with the National Medical Products Administration[59] - The company plans to raise up to approximately HKD 20.8 million through a rights issue, with an estimated net proceeds of about HKD 19.4 million[126] Corporate Governance and Compliance - The audit committee has reviewed and approved the consolidated financial statements for the year ending December 31, 2023, ensuring compliance with applicable accounting standards and regulations[144] - The company has adopted the corporate governance code as per the listing rules, emphasizing transparency, accountability, and independence[133][134] - The company has confirmed compliance with the standards set forth in the code of conduct for securities trading by all directors during the year[132] Employee and Operational Metrics - The total employee cost was approximately RMB 68.8 million, an increase of RMB 5.0 million from RMB 63.8 million in 2022, accounting for 36.3% of total revenue in 2023 (2022: 38.8%)[115] - The company had a total of 335 employees in China as of December 31, 2023, up from 322 employees in 2022[114] Market Trends and Industry Outlook - The medical beauty industry is expected to experience strong growth, supported by government policies emphasizing the development of anti-aging technologies and services[128] - The company will focus on developing non-surgical medical beauty services and increase investment in technology and research for personalized anti-aging services and products[128]