2025赛季江苏省城市足球联赛（简称"苏超"）于11月1日落幕。作为苏超南通与南京两大赛区的官方赞助商，维达 以"韧性"理念深度融入赛事保障，通过政企协同、资源整合，为全民健身事业注入品牌力量，助力江苏构建高质量体育 发展新格局。 苏超赛场(受访者供图) 赛事保障加码，筑牢全民运动服务基石。赛事期间，江苏各地同步开展形式多样的全民健身活动，"观赛+参与"的 互动模式深入人心。维达全程支持本届苏超赛事，为球员、工作人员及广大球迷提供全面保障，助力营造积极健康的赛 场氛围。 维达相关负责人介绍，公司深耕中国市场多年，持续关注国民健康事业发展。维达所属的金鹰集团早在上世纪九十 年代就开始在江苏投资布局，建立了完善的本土化业务布局。这种扎根中国、服务本土的发展理念，为维达服务苏超赛 事、践行社会责任提供有力支撑，为深化区域体育文化建设、服务健康中国战略提供了持续动能。 携手苏超，共绘体育与健康发展新蓝图。苏超联赛的成功举办，是江苏体育高质量发展的缩影。维达的参与，为企 业助力国家战略落地提供了示范。"身处民生关联紧密的卫生用品行业，维达始终将自身成长与'健康中国2030''全民健 身'等战略同频共振。此次携手苏超，也 ...

Core Insights - The signing event in Xiaonan District, Xiaogan City, Hubei Province, resulted in 15 projects with a total investment of 8.65 billion yuan, aimed at accelerating the development of the Wuhan metropolitan area [1] Group 1: Project Overview - The signed projects span various sectors including paper products, food processing, intelligent manufacturing, and new energy, indicating a diverse investment landscape [1] - Notable projects include the Vinda New City Phase III expansion, which will add over 200,000 tons of high-end household paper production capacity, marking the eighth expansion for Vinda in Xiaonan [1] - The investment of 1.2 billion yuan in the Lainisi automotive camera display module project focuses on core components for intelligent connected vehicles, collaborating closely with companies like BYD [1] Group 2: Economic Impact - These projects are expected to enhance the industrial cluster in Xiaonan and elevate the overall industrial capability [1] - The local government plans to improve the business environment under the "Xiao Zhe Ban" initiative, ensuring efficient project execution from signing to production [1]

Core Insights - The release of the "2025 Non-woven Fabric Cleaning Products Safety Standard White Paper" marks the establishment of a systematic, professional, and high-standard safety guideline for the non-woven fabric cleaning products industry in China, setting a new benchmark for safe and healthy development in the sector [1][4]. Industry Overview - The non-woven fabric cleaning products market, represented by items such as facial wipes, wet wipes, and wet toilet paper, has experienced explosive growth driven by increasing consumer health awareness, becoming a key driver of the cleaning paper market [3]. - Despite rapid growth, the industry faces significant safety concerns, including product quality inconsistencies, false advertising, and non-compliant production practices, leading to safety incidents that harm consumer rights and erode industry trust [3]. Safety Standards - The white paper introduces an innovative "5S Safety Standard" system, which breaks down safety into five quantifiable, traceable, and verifiable dimensions: 1. **Raw Material Safety**: Emphasizes source control, requiring raw materials to be pure, traceable, and free from preservatives, harmful residues, and whitening agents [4]. 2. **Ingredient Safety**: Mandates product ingredient testing and transparent ingredient information to ensure formula purity [4]. 3. **Production Environment Safety**: Focuses on strict quality control processes and compliance in manufacturing environments to prevent secondary contamination [4]. 4. **Product Quality Control Safety**: Ensures stability across the entire product lifecycle by enforcing strict controls on physical indicators like sealing and flexibility [4]. 5. **Skin Contact Safety**: Enhances user experience through improved skin testing and evaluations to ensure products are skin-friendly and non-irritating [4]. Industry Collaboration - The white paper has garnered high praise from various stakeholders, including media, data agencies, platforms, and industry representatives, who recognize the 5S safety standard's value in protecting consumer rights and promoting healthy market development [6]. - Key players like Xinhua News, Kantar, JD.com, and Saiderli have expressed their commitment to implementing the 5S standards, highlighting its role in establishing clear safety norms and evaluation systems for raw materials in the industry [6]. Future Outlook - The release of the white paper exemplifies the social responsibility and leadership of Vinda, a leading brand in the industry, which aims to guide the sector towards more standardized and healthier practices [9]. - The industry is encouraged to collectively adopt the 5S safety standards to enhance the quality of raw materials, production, and quality control, ultimately fostering a new phase of high-quality development based on safety, quality, and trust [9].

9月22日，京东超市与维达集团、凯度消费者指数、新华网联合发布《2025无纺布清洁用品安全标准白 皮书》(以下简称：白皮书)。白皮书结合当前无纺布清洁用品低价内卷竞争严重、品质安全问题频现等 乱象，创新性提出5S安全标准体系，即从皮肤接触安全、成分安全、原料安全、产品品控安全和生产 环境安全五个维度，构建洗脸巾、湿巾、湿厕纸品质新基准。 同时，白皮书系统分析了当前无纺布清洁用品市场，正在呈现出消费人群年轻化、使用场景多元化、产 品功能专业化和安全需求升级四大消费新趋势。 无纺布清洁用品消费持续升温 四大消费趋势凸显 细分品类引领行业新增长 白皮书指出，无纺布清洁用品消费持续升温，细分品类引领行业新增长。京东超市销售数据显示，2024 年清洁纸品在库商品数量同比增长达328%，其中，洗脸巾、湿厕纸、湿巾均实现双位数增长，成为拉 动行业增长的核心动力。 与此同时，无纺布清洁用品消费也呈现出消费人群年轻化、使用场景多元化、产品功能专业化和安全需 求升级四大消费新趋势。 在消费人群年轻化方面，随着近年来洗脸巾、湿厕纸等无纺布品类的渗透，消费人群年轻化趋势尤为明 显。白皮书数据显示，31-40岁群体的洗脸巾TGI指数达 ...

Financial Performance - Total revenue for 2023 was HKD 19,999 million, an increase from HKD 19,418 million in 2022, representing a growth of 3%[8] - Gross profit for 2023 was HKD 5,251 million, down from HKD 5,483 million in 2022, resulting in a gross margin of 26.3% compared to 28.2% in the previous year[8] - Operating profit decreased to HKD 424 million in 2023 from HKD 807 million in 2022, leading to an operating margin of 2.1% compared to 4.2%[8] - EBITDA for 2023 was HKD 1,768 million, down from HKD 2,104 million in 2022, with an EBITDA margin of 8.8% compared to 10.8%[8] - Net profit fell by 64.1% to HKD 253 million, with a net profit margin of 1.3%, down 2.3 percentage points[32] Debt and Liquidity - The net debt to EBITDA ratio increased to 1.7 times in 2023 from 1.6 times in 2022, indicating a slight increase in leverage[8] - The current ratio improved to 1.3 in 2023 from 1.1 in 2022, reflecting better short-term liquidity[8] - The company’s net debt ratio decreased by 2.5 percentage points to 26.1%[32] - The group maintained a net debt ratio of 26.1% as of December 31, 2023, down from 28.6% the previous year[46] Inventory and Receivables - The average inventory turnover period increased to 54 days in 2023 from 50 days in 2022, indicating a slower inventory movement[8] - The average accounts receivable turnover period increased to 41 days in 2023 from 40 days in 2022, suggesting a slight delay in collections[9] E-commerce and Market Strategy - The company plans to focus on expanding its e-commerce channels, which accounted for 21% of revenue in 2023, up from 10% in 2022[8] - In 2023, the group's e-commerce channel revenue recorded a natural growth of 12.6%, accounting for 46% of total revenue[22] - The group plans to deepen market penetration in e-commerce channels and continue focusing on high-quality development in 2024[16] - The company is committed to enhancing its product offerings and technology development to maintain competitive advantage in the hygiene products market[8] Product Development and Innovation - The introduction of innovative products, such as the "Comfort V Series - Cloud Feel Pants," has successfully met consumer demand for high-end products[19] - The company launched several new high-end products in the North Asia market, including the 4D Deluxe series in Hong Kong and the 4D series in South Korea[36] - Research and development investments increased by 25%, focusing on innovative product lines in the hygiene sector[55] Sustainability and ESG - The group received an ESG rating of "A" from MSCI for three consecutive years, reflecting its commitment to sustainable development[17] - The group received an "A" rating from MSCI for three consecutive years, reflecting its leadership in ESG practices, particularly in governance and waste management[25] - The company aims to achieve carbon neutrality by 2025, aligning with global sustainability trends[53] - The company has developed a five-year sustainable development roadmap covering energy management, carbon emissions, and green supply chains[137] Corporate Governance - The board of directors has committed to maintaining high corporate governance standards, adhering to all applicable regulations[72] - The company has achieved compliance with all corporate governance codes as outlined in the annual report[72] - The board includes four independent non-executive directors, enhancing critical review and control over management processes[102] Shareholder Communication - The company has established a shareholder communication policy to ensure timely and balanced access to information for shareholders and investors[129] - The board will continue to engage in dialogue with shareholders and regularly review the effectiveness of the shareholder communication policy[130] - The company encourages shareholders to appoint representatives to attend meetings and vote if they cannot attend in person[132] Future Outlook - The company projects a revenue growth of 20% for the upcoming fiscal year, driven by new product launches and market expansion strategies[54] - Future outlook includes an expansion strategy targeting a 20% market share increase in the adult incontinence product segment over the next two years[67] Risk Management - The company has a robust credit risk management policy, ensuring sales are made only to customers with good credit records[147] - The company maintains a prudent liquidity risk management strategy to ensure sufficient cash and cash equivalents are available[147] - The company’s overall risk management plan focuses on minimizing potential adverse impacts on financial performance due to market unpredictability[148] Employee Development - A total of 161,323 training hours were provided to 10,051 employees, with a workforce of 11,465 as of December 31, 2023[41] - The company emphasizes the importance of continuous professional development for all directors[94]

Financial Performance - The group's revenue achieved a natural growth of 6.9% to HKD 19,999 million[5] - Gross profit decreased by 4.2% to HKD 5,251 million, with a gross profit margin of 26.3%, down 1.9 percentage points[5] - Net profit fell by 64.1% to HKD 253 million, with a net profit margin of 1.3%, down 2.3 percentage points[10] - Basic earnings per share were HKD 0.21, down from HKD 0.587 in the previous year[11] - Total revenue for the year ended December 31, 2023, was HKD 19,999,100,319, an increase of 3.0% from HKD 19,417,559,563 in 2022[37] - Operating profit decreased by 47.4% to HKD 424 million, with an operating profit margin of 2.1%[7] - Operating profit fell significantly to HKD 424,011,450, a decline of 47.4% compared to HKD 806,516,544 in 2022[37] - Net profit attributable to equity holders was HKD 253,151,520, down 64.1% from HKD 706,039,502 in the prior year[37] - Basic and diluted earnings per share decreased to HKD 0.210 from HKD 0.587, representing a decline of 64.3%[37] Revenue Breakdown - E-commerce channel revenue grew naturally by 12.6%, accounting for 46% of total revenue[5] - The tissue business generated revenue of HKD 16,655 million, a year-on-year increase of 3.4%, with a natural growth of 7.6% excluding currency effects[13] - Personal care business revenue grew by 0.9% to HKD 3,344 million, with a natural growth rate impact of 3.7%, accounting for 17% of total group revenue[17] - Revenue from the Mainland China segment reached HKD 15,685,228,868, up from HKD 15,154,602,695, reflecting a growth of 3.5%[55] - The personal care products segment generated revenue of HKD 3,344,011,832, compared to HKD 3,314,390,014 in the previous year, indicating a slight increase of 0.9%[61] Cost and Expenses - The total cost of sales, selling, and administrative expenses for the year was HKD 19,676,524,300, an increase from HKD 18,683,339,551 in 2022, representing a rise of 5.3%[67] - Capital expenditures for non-current assets amounted to HKD 1,027,382,250, compared to HKD 1,251,247,213 in the previous year, reflecting a decrease of 17.9%[61] - Interest expenses increased significantly to HKD 149,331,326 in 2023 from HKD 87,836,706 in 2022, reflecting a rise of approximately 69.9%[69] - Net financial costs rose to HKD 136,399,340 in 2023, compared to HKD 59,600,287 in 2022, indicating an increase of about 128.5%[69] Cash Flow and Liquidity - Cash and cash equivalents increased to HKD 1,375,581,365 from HKD 606,947,407, an increase of 126.3%[38] - Operating cash flow for the year ended December 31, 2023, was HKD 2,272,324,627, a decrease of 5.3% from HKD 2,399,371,922 in 2022[41] - Net cash generated from operating activities decreased to HKD 1,944,402,474 from HKD 2,081,190,349, reflecting a decline of 6.6%[41] - Cash flow from financing activities showed a net outflow of HKD 125,507,119, compared to a net outflow of HKD 1,339,494,139 in 2022, indicating a significant reduction in cash outflow[41] Debt and Liabilities - The net debt ratio decreased by 2.5 percentage points to 26.1%[9] - Total liabilities decreased to HKD 10,617,044,930 from HKD 12,288,358,417, a decline of 13.6%[39] - Borrowings decreased to HKD 4,074,955,423 from HKD 4,711,269,760, reflecting a reduction of 13.5%[41] - The total borrowings increased from HKD 3,888,244,226 in 2022 to HKD 4,256,190,597 in 2023, an increase of approximately 9%[90] Operational Efficiency and Strategy - The company implemented flexible pricing strategies and improved operational efficiency to mitigate inflationary pressures[4] - The company continues to focus on innovation and brand building, enhancing e-commerce channels to expand market share[4] - The group maintained a strong financial position with cash and bank balances of HKD 1,375,581,365 as of December 31, 2023, compared to HKD 606,947,407 in 2022[100] Employee and Training - The group provided 161,316 hours of training to 10,030 employees, emphasizing its commitment to employee development[25] - The group aims for zero accidents in production, with 22 loss time incidents reported in 2023, a decrease from 28 in 2022[28] Corporate Governance - The board of directors includes a mix of executive and non-executive members, ensuring diverse oversight and governance[123] - The risk management committee consists of five members, including two executive directors and three non-executive directors, with Jan Christer JOHANSSON serving as the chairman[114] - The executive committee is responsible for formulating the annual budget and major business plans, with a focus on restructuring and significant asset handling[115] Future Outlook - The group maintains confidence in growth potential despite economic uncertainties, focusing on high-end and high-margin product categories[32] - The group will continue to invest in e-commerce and new channels to strengthen its market position in mainland China[35]

Revenue Performance - Total revenue for Q3 2023 increased by 8.4% to HKD 4,741 million, with HKD 3,915 million from the tissue segment and HKD 826 million from personal care[2] - Total revenue for the nine months ended September 30, 2023, grew by 5.4% to HKD 14,810 million, with HKD 12,276 million from the tissue segment and HKD 2,534 million from personal care[3] Profitability Metrics - Gross profit for Q3 2023 rose by 8.7% to HKD 1,294 million, with a gross margin increase of 0.1 percentage points to 27.3%[2] - Gross profit for the nine months decreased by 11.0% to HKD 3,821 million, with a corresponding gross margin decline of 4.7 percentage points to 25.8%[3] - Operating profit surged by 71.6% to HKD 133 million, with an operating margin increase of 1.0 percentage points to 2.8%[2] - Operating profit for the nine months fell by 67.6% to HKD 270 million, with an operating margin contraction of 4.1 percentage points to 1.8%[3] - EBITDA for Q3 2023 improved by 16.4% to HKD 465 million, with an EBITDA margin increase of 0.7 percentage points to 9.8%[2] Exchange Loss - Total exchange loss for Q3 2023 was HKD 10.7 million, significantly improved from a loss of HKD 54.1 million in Q3 2022[2] Strategic Focus - The company continues to focus on innovation and brand building to sustain competitive advantages and drive profitable growth in key markets[2] Shareholding Information - Essity Aktiebolag (publ) holds approximately 51.59% of the company's issued share capital[3]

Financial Performance - Total revenue for the first half of 2023 reached HKD 10,070 million, representing a natural growth of 10.1% and a 4.0% increase in HKD terms [28]. - Basic earnings per share for the first half of 2023 were HKD 0.10, down from HKD 0.53 in the same period last year [10]. - The company reported a net profit of HKD 120,646,352 for the first half of 2023, compared to HKD 637,715,230 for the same period in 2022, indicating a decrease of about 81.1% [131]. - The company reported a net loss attributable to shareholders of HKD 318,484,454 compared to a loss of HKD 19,159,364 in the previous year, indicating a significant increase in losses [99]. - The company incurred a total comprehensive loss of HKD 318,484,454 for the six months ended June 30, 2023, compared to a total comprehensive loss of HKD 19,159,364 for the same period in 2022, highlighting a worsening financial position [102]. Profitability Metrics - Gross profit margin decreased to 25.1% from 32.0% in the same period last year, while net profit margin fell to 1.2% from 6.6% [10]. - Operating profit fell by 81.8% to HKD 137 million, with an operating margin decrease of 6.4 percentage points to 1.4% [33]. - Gross profit decreased by 18.5% to HKD 2,527 million, with a gross margin decline of 6.9 percentage points to 25.1% [32]. - The segment profit for the personal care products division reported a loss of HKD 23,837,267, compared to a profit of HKD 33,015,264 in the previous year, indicating a significant decline [130]. Revenue Breakdown - The tissue segment accounted for 83% of total revenue, while personal care contributed 17% [28]. - Tissue business revenue increased by 5.0% to HKD 8,361 million, with a growth of 11.5% after excluding currency effects, accounting for 83% of total revenue [36]. - Personal care business revenue decreased by 0.5% to HKD 1,708 million, but showed a growth of 3.7% at constant exchange rates, representing 17% of total revenue [38]. - Revenue from Mainland China reached HKD 7,911,383,829, up from HKD 7,526,820,217, indicating a growth of about 5.12% [127]. - Revenue from Hong Kong was HKD 612,881,559, compared to HKD 583,343,849 in the previous year, reflecting an increase of approximately 5.06% [127]. - Revenue from overseas markets decreased slightly to HKD 1,545,345,422 from HKD 1,570,211,394, a decline of about 1.58% [127]. Debt and Financial Leverage - The company’s debt ratio increased to 50.5% from 31.9% year-on-year, indicating a rise in financial leverage [10]. - The interest expense increased by 119.9% to HKD 78 million due to rising interest rates and increased term loans [33]. - Total short-term and long-term loans amounted to HKD 5,551,579,123 as of June 30, 2023, compared to HKD 3,888,244,226 on December 31, 2022 [54]. - The net debt ratio was 43.1% as of June 30, 2023, up from 28.6% on December 31, 2022 [54]. - The average effective interest rate for HKD borrowings was 4.69% as of June 30, 2023, compared to 2.03% as of December 31, 2022, indicating a significant rise in borrowing costs [151]. Cash Flow and Liquidity - Cash flow from operating activities showed a net outflow of HKD 696,745,207 for the six months ended June 30, 2023, compared to a net inflow of HKD 1,959,993,971 in the previous year, reflecting a substantial decline in operational cash generation [105]. - The company’s cash and cash equivalents increased by HKD 261,255,618 during the six months ended June 30, 2023, compared to an increase of HKD 40,167,970 in the prior year, suggesting improved liquidity management despite operational challenges [105]. - As of June 30, 2023, the company had cash and bank balances of HKD 838,118,380, an increase from HKD 606,947,407 on December 31, 2022 [54]. Investment and Innovation - The company plans to continue investing in innovation, brand building, and operational capabilities to drive sustainable profit growth in key markets [27]. - The company aims to use 100% certified wood pulp and is developing biodegradable materials for packaging [49]. - The company plans to continue investing in high-end and high-margin product categories to enhance its product portfolio [51]. - The company launched new high-end products in the incontinence care sector, enhancing market penetration and brand competitiveness [41]. - The Southeast Asia regional headquarters commenced operations, featuring the first overseas innovation and R&D center to better meet local consumer demands [44]. Employee Development - The company provided 95,417.18 hours of training to 11,066 employees during the reporting period, emphasizing its commitment to employee development [45]. Corporate Governance - The company has maintained a strong commitment to corporate governance and compliance with all relevant codes [61]. - The Audit Committee consists of four members, including three independent non-executive directors [81]. - The Remuneration Committee is responsible for determining the remuneration policy and specific compensation for senior management [82]. - The Risk Management Committee assists the board in determining the group's risk levels and reviewing identified major risks [85]. - The Strategy Development Committee is tasked with advising on the group's long-term strategy and overseeing the implementation of strategic plans [87].

[Summary](index=1&type=section&id=Summary) The Group achieved **10.1% organic revenue growth** to **HKD 10,070 million**, driven by price increases, higher sales volume, and an optimized product mix - Group revenue achieved **10.1% organic growth** to **HKD 10,070 million**, primarily driven by price and sales volume increases, and an optimized product mix[2](index=2&type=chunk) - E-commerce channels recorded **23.6% organic growth**, accounting for **46% of total Group revenue**[2](index=2&type=chunk) - Gross profit decreased by **18.5% to HKD 2,527 million** due to cost inflation pressure, while net profit declined by **81.1% to HKD 121 million**[2](index=2&type=chunk) Financial Performance Summary | Metric | H1 2023 (HKD) | H1 2022 (HKD) | Y-o-Y Change (%) | | :--- | :-------------------- | :-------------------- | :----------- | | Revenue | 10,070 million | 9,680 million | 4.0% (10.1% organic growth) | | Gross Profit | 2,527 million | 3,100 million | -18.5% | | Net Profit | 121 million | 638 million | -81.1% | | Basic EPS | 0.10 HKD | 0.53 HKD | -81.1% | | Interim Dividend | 0.10 HKD | 0.10 HKD | 0.0% | [Management Discussion and Analysis](index=2&type=section&id=Management%20Discussion%20and%20Analysis) The Group achieved strong organic sales growth despite post-pandemic uncertainties, mitigating cost inflation through pricing and product mix optimization, while continuing strategic investments for sustainable profitability [Overview](index=2&type=section&id=Overview) Despite post-pandemic uncertainties, the Group achieved strong organic sales growth in H1 2023, mitigating raw material cost increases through pricing and product mix upgrades, maintaining market leadership in tissue and growing personal care, while investing in innovation for future sustainable profitability - The Group achieved **strong organic sales growth** in H1 2023, mitigating raw material price increases through price adjustments and product mix upgrades, especially in premium categories like Tempo brand[4](index=4&type=chunk) - Tissue business maintained **market leadership** in Mainland China and Hong Kong, with continuous market share growth in personal care business[4](index=4&type=chunk) - Gross profit and net profit remained negatively impacted by inflation, with high-cost raw material inventory digestion pressuring margins despite falling raw material prices[4](index=4&type=chunk) - The Group will continue to invest in innovation, brand building, and operational capabilities to drive future sustainable profitable growth[4](index=4&type=chunk) [Financial Highlights](index=2&type=section&id=Financial%20Highlights) In H1 2023, the Group's total revenue reached **HKD 10,070 million** with **10.1% organic growth**, but gross profit and net profit significantly declined due to cost inflation, leading to reduced margins and increased net gearing Key Financial Performance | Metric | H1 2023 (million HKD) | H1 2022 (million HKD) | Y-o-Y Change (%) | | :--- | :-------------------- | :-------------------- | :----------- | | Total Revenue | 10,070 | 9,680 | 4.0% (10.1% organic growth) | | Gross Profit | 2,527 | 3,100 | -18.5% | | EBITDA | 818 | 1,418 | -42.3% | | Operating Profit | 137 | 757 | -81.8% | | Net Profit | 121 | 638 | -81.1% | | Basic EPS (HK cents) | 10.0 | 53.0 | -81.1% | Profitability Ratios | Metric | H1 2023 | H1 2022 | Change (percentage points) | | :--- | :----------- | :----------- | :------------ | | Gross Margin | 25.1% | 32.0% | -6.9 | | EBITDA Margin | 8.1% | 14.6% | -6.5 | | Operating Margin | 1.4% | 7.8% | -6.4 | | Net Profit Margin | 1.2% | 6.6% | -5.4 | Revenue Contribution by Business Segment | Business Segment | Share of Total Revenue (H1 2023) | | :------- | :-------------------------- | | Tissue Segment | 83% | | Personal Care Segment | 17% | Revenue Contribution by Sales Channel | Sales Channel | Share of Total Revenue (H1 2023) | Organic Growth Rate | | :------- | :-------------------------- | :--------- | | E-commerce Channels | 46% | 23.6% | | Traditional Distributors | 24% | N/A | | Modern Channels (Supermarkets/Hypermarkets) | 21% | N/A | | Commercial | 9% | N/A | - Borrowing interest expenses increased by **119.9% to HKD 78 million**, primarily due to rising interest rates and increased term loans[6](index=6&type=chunk) - Net gearing ratio increased to **43.1%** from **28.6%** at the end of 2022[6](index=6&type=chunk)[52](index=52&type=chunk) [Business Review](index=4&type=section&id=Business%20Review) The Group's business review highlights strong performance in tissue and personal care segments, driven by premiumization strategies, e-commerce growth, and market leadership in key regions [Tissue Business](index=4&type=section&id=Tissue%20Business) In H1 2023, tissue business revenue reached **HKD 8,361 million**, growing **5.0%** (or **11.5% at fixed exchange rates**), maintaining market leadership in Mainland China and Hong Kong through premiumization and strong sales of high-end products, despite a **7.8 percentage point** decline in gross margin due to high-cost pulp inventory and promotions Tissue Business Revenue Performance | Metric | H1 2023 (million HKD) | H1 2022 (million HKD) | Y-o-Y Growth (%) | Fixed Exchange Rate Growth (%) | Share of Total Group Revenue | | :--- | :-------------------- | :-------------------- | :----------- | :--------------- | :--------------- | | Tissue Business Revenue | 8,361 | 7,963 | 5.0% | 11.5% | 83% | - Tissue business maintained **market leadership** in Mainland China and Hong Kong, with continuous development in Southeast Asia[7](index=7&type=chunk) - Premiumization strategy drove **double-digit sales growth** for high-end tissue product portfolios in Mainland China, with Vinda Deluxe Cotton Soft and Tempo series products receiving strong acclaim[7](index=7&type=chunk) - Wet wipes business (wet toilet paper, kitchen wet wipes, bathroom wet wipes) developed well, helping the Group increase its market share in wet wipes[7](index=7&type=chunk) Tissue Segment Gross Margin | Metric | H1 2023 | H1 2022 | Change (percentage points) | | :--- | :----------- | :----------- | :------------ | | Tissue Segment Gross Margin | 23.8% | 31.6% | -7.8 | [Personal Care Business](index=5&type=section&id=Personal%20Care%20Business) In H1 2023, personal care business revenue was **HKD 1,708 million**, a **0.5% decrease** (or **3.7% growth at fixed exchange rates**), with a gross margin of **31.2%**, driven by strong performance in feminine and adult incontinence care through marketing and new product launches Personal Care Business Revenue Performance | Metric | H1 2023 (million HKD) | H1 2022 (million HKD) | Y-o-Y Change (%) | Fixed Exchange Rate Growth (%) | Share of Total Group Revenue | | :--- | :-------------------- | :-------------------- | :----------- | :--------------- | :--------------- | | Personal Care Business Revenue | 1,708 | 1,717 | -0.5% | 3.7% | 17% | Personal Care Segment Revenue and Gross Margin by Category | Category | H1 2023 Revenue (million HKD) | H1 2023 Gross Margin | | :--- | :-------------------------- | :----------------- | | Baby Care | 556 | 24.0% | | Feminine Care | 400 | 46.7% | | Adult Care | 752 | 28.2% | | **Personal Care Segment Total** | **1,708** | **31.2%** | - Libresse brand deepened its pioneering feminine care brand image through "No Hidden Period" 4.0 campaign and Douyin Super Brand Day, driving continuous product sales growth[8](index=8&type=chunk) - TENA and Dr. P brands launched new premium products in incontinence care, enhancing market penetration and professional image through consumer salons, hospital stores, and Vinda Health TENA Experience Centers (363 cumulative)[8](index=8&type=chunk) [Baby Care Business](index=6&type=section&id=Baby%20Care%20Business) The baby care business, led by Drypers in Malaysia, demonstrated strong performance in Southeast Asia through innovative marketing campaigns, enhancing brand awareness and sales, and solidifying its market leadership - Drypers, a leading baby diaper brand in Malaysia, performed **outstandingly in Southeast Asia**[9](index=9&type=chunk) - Innovative marketing, including a themed brand film, CoComelon limited edition packaging, and offline parent-child activities, effectively boosted product sales and brand awareness, solidifying market leadership[9](index=9&type=chunk) [Production Capacity](index=6&type=section&id=Production%20Capacity) As of June 30, 2023, the Group's papermaking equipment had a designed annual production capacity of **1,390,000 tonnes**, with the Southeast Asia regional headquarters in Malaysia operational since December 2022, featuring its first overseas innovation and R&D center Papermaking Equipment Designed Annual Production Capacity | Metric | As of June 30, 2023 | | :--- | :--------------- | | Designed Annual Production Capacity of Papermaking Equipment | 1,390,000 tonnes | - The Southeast Asia regional headquarters in Malaysia became operational in **December 2022**, housing the first overseas innovation and R&D center[10](index=10&type=chunk) - Aimed at precisely meeting Southeast Asian consumer demand, strengthening supply chain coverage, and enhancing production and sales efficiency[10](index=10&type=chunk) [Human Resources Management and Internal Control](index=6&type=section&id=Human%20Resources%20Management%20and%20Internal%20Control) Vinda views employees as the cornerstone of sustainable development, providing equal employment opportunities, fair compensation, and continuous professional development training, while upholding high corporate governance standards and regularly reviewing internal control policies Human Resources Metrics | Metric | H1 2023 | | :--- | :----------- | | Total Training Hours | 95,417.18 hours | | Number of Trainees | 11,066 persons | | Total Employees (as of June 30, 2023) | 11,887 employees | - The Group is committed to providing **equal employment opportunities**, **fair compensation management**, and **continuous professional development training**[11](index=11&type=chunk) - **100% of employees** have received Code of Conduct training, with the internal audit department responsible for identifying, addressing, and reporting significant risks and internal control deficiencies[11](index=11&type=chunk) [Sustainable Procurement](index=7&type=section&id=Sustainable%20Procurement) The Group prioritizes environmentally certified raw materials and adheres to low-carbon and green supply chain standards, with all top 20 non-pulp suppliers ISO 14001 certified in 2022, and aims for all wood pulp to be forest management certified while increasing biodegradable packaging - Prioritizes environmentally certified raw materials and adheres to low-carbon and green supply chain standards[12](index=12&type=chunk) - In **2022**, all top 20 raw and auxiliary material suppliers (excluding wood pulp) obtained **ISO 14001 environmental management certification**[12](index=12&type=chunk) - Vinda product packaging uses renewable or recyclable materials, aiming for all wood pulp to be forest management certified and increasing the proportion of biodegradable materials[12](index=12&type=chunk) [Outlook](index=7&type=section&id=Outlook) Despite economic uncertainties, the Group is confident in its growth potential, anticipating easing inflation, and will strategically invest in premium and high-margin categories, personal care, e-commerce, and new channels to drive differentiated, sustainable, and profitable growth - The Group is **confident in the growth potential** of its operating categories and anticipates easing inflationary pressures[13](index=13&type=chunk) - Will continue to invest in **premium and high-margin categories**, personal care business in key markets, e-commerce, and new channels[13](index=13&type=chunk) - Will continue to invest in **brand building and innovation** to achieve differentiation and maintain premium pricing advantages, laying the foundation for long-term sustainable profitable growth[13](index=13&type=chunk) [Condensed Consolidated Interim Financial Information](index=8&type=section&id=Condensed%20Consolidated%20Interim%20Financial%20Information) This section presents the Group's unaudited condensed consolidated interim financial statements, including comprehensive income, financial position, changes in equity, and cash flows for the period [Condensed Consolidated Interim Statement of Comprehensive Income](index=8&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2023, Group revenue increased by **4.0% to HKD 10,069.6 million**, but gross profit, operating profit, and profit attributable to equity holders significantly declined due to a **14.6% increase in cost of sales** Condensed Consolidated Interim Statement of Comprehensive Income | Metric | H1 2023 (HKD) | H1 2022 (HKD) | Y-o-Y Change (%) | | :--- | :-------------------- | :-------------------- | :----------- | | Revenue | 10,069,610,810 | 9,680,375,460 | 4.0% | | Cost of sales | (7,543,054,231) | (6,580,323,074) | 14.6% | | Gross profit | 2,526,556,579 | 3,100,052,386 | -18.5% | | Selling and distribution expenses | (1,940,747,502) | (1,895,316,830) | 2.4% | | Administrative expenses | (477,518,937) | (478,370,521) | -0.2% | | Operating profit | 137,383,940 | 756,918,414 | -81.8% | | Net finance costs | (67,807,683) | (25,204,168) | 169.8% | | Profit before income tax | 69,574,744 | 731,684,124 | -90.5% | | Income tax credit / (expense) | 51,071,608 | (93,968,894) | N/A | | Profit attributable to equity holders of the Company | 120,646,352 | 637,715,230 | -81.1% | | Basic earnings per share (HKD) | 0.100 | 0.530 | -81.1% | | Diluted earnings per share (HKD) | 0.100 | 0.530 | -81.1% | [Condensed Consolidated Interim Statement of Financial Position](index=9&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Financial%20Position) As of June 30, 2023, total assets decreased by **6.1% to HKD 22,805.5 million**, primarily due to a **24.1% reduction in inventories**, while total equity and liabilities also decreased, despite an increase in borrowings Consolidated Financial Position Summary | Metric | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Total Assets | 22,805,462,022 | 24,288,643,860 | -6.1% | | Total Non-current Assets | 14,187,490,652 | 14,703,634,063 | -3.5% | | Total Current Assets | 8,617,971,370 | 9,585,009,797 | -10.1% | | Total Equity | 11,320,918,777 | 12,000,285,443 | -5.7% | | Total Liabilities | 11,484,543,245 | 12,288,358,417 | -6.5% | Current Assets Breakdown | Current Asset Item | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Inventories | 4,561,238,574 | 6,014,823,036 | -24.1% | | Trade and bills receivables | 2,503,218,417 | 2,339,665,339 | 7.0% | | Cash and cash equivalents | 838,118,380 | 606,947,407 | 38.1% | Current and Non-current Liabilities Breakdown | Liability Item | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Trade and other payables and accruals | 4,989,683,277 | 7,548,972,120 | -33.9% | | Borrowings (current) | 1,198,680,882 | 299,246,812 | 300.6% | | Borrowings (non-current) | 3,968,774,941 | 2,800,715,036 | 41.7% | [Condensed Consolidated Interim Statement of Changes in Equity](index=11&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Changes%20in%20Equity) As of June 30, 2023, total equity attributable to equity holders decreased from **HKD 12,000.3 million** to **HKD 11,320.9 million**, primarily due to a **HKD 318.5 million comprehensive loss** and **HKD 361.0 million in dividend payments** Changes in Total Equity | Metric | Balance as of Jan 1, 2023 (HKD) | Balance as of June 30, 2023 (HKD) | Change (HKD) | | :--- | :-------------------- | :-------------------- | :---------- | | Total Equity | 12,000,285,443 | 11,320,918,777 | (679,366,666) | - Total comprehensive loss for the period was **HKD 318.5 million**, including a **HKD 439.1 million loss** from currency translation differences[19](index=19&type=chunk) - Dividend payments related to transactions with owners amounted to **HKD 361.0 million**[19](index=19&type=chunk) [Condensed Consolidated Interim Statement of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Cash%20Flows) In H1 2023, net cash flow from operating activities turned into an **outflow of HKD 696.7 million**, while financing activities generated a **net inflow of HKD 1,430.2 million** due to new borrowings, resulting in a **HKD 261.3 million increase** in cash and cash equivalents Condensed Consolidated Interim Statement of Cash Flows | Cash Flow Activity | H1 2023 (HKD) | H1 2022 (HKD) | Change (HKD) | | :--- | :-------------------- | :-------------------- | :---------- | | Net cash flow (used in) / generated from operating activities | (696,745,207) | 1,959,993,971 | (2,656,739,178) | | Net cash flow used in investing activities | (472,201,825) | (562,092,534) | 89,890,709 | | Net cash flow generated from / (used in) financing activities | 1,430,202,650 | (1,357,733,467) | 2,787,936,117 | | Net increase in cash and cash equivalents | 261,255,618 | 40,167,970 | 221,087,648 | | Cash and cash equivalents at end of period | 838,118,380 | 1,009,290,494 | (171,172,114) | - Operating cash flow shifted from a net inflow to a **net outflow**, reflecting challenges in operations or working capital management[20](index=20&type=chunk) - Financing cash flow shifted from a net outflow to a **net inflow**, primarily driven by new borrowings[20](index=20&type=chunk) [Notes to the Condensed Consolidated Interim Financial Information](index=13&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Information) This section provides detailed notes to the condensed consolidated interim financial information, covering general information, basis of preparation, significant accounting policies, and other financial disclosures [General Information](index=13&type=section&id=General%20Information) Vinda International Holdings Limited, incorporated in the Cayman Islands, primarily manufactures and sells tissue and personal care products, listed on HKEX since July 10, 2007, with Essity Aktiebolag (publ) as its ultimate holding company - Vinda International Holdings Limited's principal activities are the manufacture and sale of tissue paper products and personal care products[21](index=21&type=chunk) - The Company's shares have been listed on The Stock Exchange of Hong Kong Limited since **July 10, 2007**[21](index=21&type=chunk) - Essity Aktiebolag (publ) is the ultimate holding company of the Group[21](index=21&type=chunk) [Basis of Preparation](index=13&type=section&id=Basis%20of%20Preparation) The condensed consolidated interim financial information for the six months ended June 30, 2023, is prepared in accordance with HKAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual financial statements for the year ended December 31, 2022 - The condensed consolidated interim financial information is prepared in accordance with **HKAS 34 "Interim Financial Reporting"**[22](index=22&type=chunk) - Should be read in conjunction with the annual financial statements for the year ended December 31, 2022, considering newly adopted standard amendments[22](index=22&type=chunk) [Significant Accounting Policies](index=14&type=section&id=Significant%20Accounting%20Policies) This section details the significant accounting policies, including newly adopted and not yet effective standards and amendments, particularly regarding deferred income tax recognition for transactions generating equal taxable and deductible temporary differences [New and Amended Standards Adopted by the Group](index=14&type=section&id=New%20and%20Amended%20Standards%20Adopted%20by%20the%20Group) The Group adopted several standard amendments effective January 1, 2023, including HKAS 12 (Amendments) requiring deferred income tax recognition for transactions generating equal taxable and deductible temporary differences, with no material cumulative impact on opening retained earnings as of December 31, 2022 - Adopted several standard amendments effective **January 1, 2023**, including HKAS 12 (Amendments) regarding deferred income tax recognition[24](index=24&type=chunk) - The amendment requires deferred income tax recognition for transactions generating equal taxable and deductible temporary differences upon initial recognition, such as leases and decommissioning obligations[24](index=24&type=chunk) - As of **December 31, 2022**, the cumulative impact of these adjustments was **not material**, with no adjustments made to opening retained earnings or other equity components[25](index=25&type=chunk) [New and Amended Standards Not Yet Effective](index=15&type=section&id=New%20and%20Amended%20Standards%20Not%20Yet%20Effective) The Group has not early adopted new and amended standards effective for fiscal years beginning on or after January 1, 2024, including HKAS 1 (Amendments) on liability classification and HKFRS 16 (Amendments) on lease liabilities in sale and leaseback transactions, and is currently assessing their full impact - Has not early adopted several new and amended standards effective for fiscal years beginning on or after **January 1, 2024**, including HKAS 1 (Amendments) and HKFRS 16 (Amendments)[26](index=26&type=chunk)[27](index=27&type=chunk) - The Group is currently assessing the full impact of these new standards, interpretations, and amendments to standards and interpretations[27](index=27&type=chunk) [Segment Revenue](index=15&type=section&id=Segment%20Revenue) The Group's Executive Committee reviews business performance primarily by business type (tissue and personal care products) rather than geographical distribution, with inter-segment sales conducted on fair terms and Mainland China contributing the largest share of external customer revenue - The Executive Committee reviews business performance primarily by **business type** (tissue paper products and personal care products), rather than geographical distribution[28](index=28&type=chunk) Revenue from External Customers by Geographical Segment | Geographical Segment | H1 2023 Revenue (HKD) | H1 2022 Revenue (HKD) | | :--- | :-------------------- | :-------------------- | | Mainland China | 7,911,383,829 | 7,526,820,217 | | Hong Kong | 612,881,559 | 583,343,849 | | Overseas | 1,545,345,422 | 1,570,211,394 | | **Total Revenue** | **10,069,610,810** | **9,680,375,460** | Revenue from External Customers by Business Segment | Business Segment | H1 2023 Revenue (HKD) | H1 2022 Revenue (HKD) | | :--- | :-------------------- | :-------------------- | | Tissue paper products | 8,361,343,453 | 7,963,350,222 | | Personal care products | 1,708,267,357 | 1,717,025,238 | | **Total** | **10,069,610,810** | **9,680,375,460** | [Net Finance Income and Costs](index=16&type=section&id=Net%20Finance%20Income%20and%20Costs) In H1 2023, net finance costs significantly increased by **169.8% to HKD 67.8 million**, primarily due to a **119.9% surge in borrowing interest expenses** to **HKD 77.5 million**, partially offset by foreign exchange gains and bank interest income Net Finance Income and Costs Breakdown | Metric | H1 2023 (HKD) | H1 2022 (HKD) | Y-o-Y Change (%) | | :--- | :-------------------- | :-------------------- | :----------- | | Interest expense - borrowings | (77,543,057) | (35,260,544) | 119.9% | | Interest expense - lease liabilities | (3,282,031) | (3,763,701) | -12.8% | | Foreign exchange gains - net | 5,129,928 | 3,794,574 | 35.2% | | Interest income - bank deposits | 7,887,477 | 10,025,503 | -21.3% | | **Net finance costs** | **(67,807,683)** | **(25,204,168)** | **169.8%** | [Income Tax (Credit) / Expense](index=17&type=section&id=Income%20Tax%20%28Credit%29%20%2F%20Expense) In H1 2023, the Group recorded an income tax credit of **HKD 51.1 million**, a significant shift from the **HKD 94.0 million expense** in H1 2022, primarily due to a **HKD 131.7 million deferred income tax credit**, with varying corporate income tax rates across regions and a **15% preferential rate** for high-tech enterprises in Mainland China Income Tax (Credit) / Expense Breakdown | Metric | H1 2023 (HKD) | H1 2022 (HKD) | | :--- | :-------------------- | :-------------------- | | Current income tax - Hong Kong and overseas profits tax | 69,821,733 | 46,409,392 | | Current income tax - Mainland China income tax | 10,798,730 | 12,764,499 | | Deferred income tax | (131,692,071) | 34,795,003 | | **Total income tax (credit) / expense** | **(51,071,608)** | **93,968,894** | - Applicable corporate income tax rates for subsidiaries in Hong Kong, Malaysia, and Taiwan are **16.5%**, **24%**, and **20%**, respectively; Mainland China subsidiaries apply a **25% rate**, with high-tech enterprises enjoying a **15% preferential rate**[33](index=33&type=chunk) [Earnings Per Share](index=17&type=section&id=Earnings%20Per%20Share) This section details the calculation of basic and diluted earnings per share, both significantly decreasing in H1 2023 due to lower profit attributable to equity holders [Basic](index=17&type=section&id=Basic) In H1 2023, basic earnings per share significantly decreased to **HKD 0.100** from **HKD 0.530** in H1 2022, calculated from **HKD 120.6 million profit** attributable to equity holders and **1,203.3 million weighted average ordinary shares outstanding** Basic Earnings Per Share Calculation | Metric | H1 2023 | H1 2022 | | :--- | :----------- | :----------- | | Profit attributable to equity holders of the Company (HKD) | 120,646,352 | 637,715,230 | | Weighted average number of ordinary shares in issue | 1,203,280,898 | 1,202,590,748 | | Basic earnings per share (HKD per share) | 0.100 | 0.530 | [Diluted](index=18&type=section&id=Diluted) In H1 2023, diluted earnings per share was **HKD 0.100**, consistent with basic EPS, indicating minimal potential dilutive impact, with only a slight increase in the weighted average number of ordinary shares due to share option adjustments Diluted Earnings Per Share Calculation | Metric | H1 2023 | H1 2022 | | :--- | :----------- | :----------- | | Profit attributable to equity holders of the Company (HKD) | 120,646,352 | 637,715,230 | | Weighted average number of ordinary shares in issue | 1,203,280,898 | 1,202,590,748 | | Adjustment for share options | 2,284 | 202,177 | | Weighted average number of ordinary shares for diluted earnings per share | 1,203,283,182 | 1,202,792,925 | | Diluted earnings per share (HKD per share) | 0.100 | 0.530 | [Dividends](index=18&type=section&id=Dividends) The Company paid a final dividend of **HKD 0.30 per ordinary share** for FY2022, totaling **HKD 360.99 million**, on June 8, 2023, and declared an interim dividend of **HKD 0.10 per share** for H1 2023, consistent with 2022, totaling **HKD 120.33 million** Dividend Declarations and Payments | Dividend Type | Amount Per Share (HKD) | Total Amount (HKD) | Payment Date | | :--- | :-------------- | :------------ | :------- | | 2022 Final Dividend | 0.30 | 360,985,612 | June 8, 2023 | | 2023 Interim Dividend | 0.10 | 120,328,537 | Board resolution declared | | 2022 Interim Dividend | 0.10 | 120,327,537 | N/A | [Property, Plant and Equipment, Intangible Assets and Investment Properties](index=19&type=section&id=Property%2C%20Plant%20and%20Equipment%2C%20Intangible%20Assets%20and%20Investment%20Properties) As of June 30, 2023, the net book value of property, plant and equipment was **HKD 9,903.4 million**, and intangible assets were **HKD 2,362.5 million**, both decreasing from January 1, 2023, with **HKD 423.4 million** in additions to property, plant and equipment and **HKD 4.7 million** in capitalized borrowing costs Net Book Value of Property, Plant and Equipment, Intangible Assets and Investment Properties | Asset Category | Net Book Value as of Jan 1, 2023 (HKD) | Net Book Value as of June 30, 2023 (HKD) | Change (HKD) | | :--- | :-------------------- | :-------------------- | :---------- | | Property, plant and equipment | 10,353,535,314 | 9,903,369,300 | (450,166,014) | | Intangible assets | 2,456,705,131 | 2,362,480,746 | (94,224,385) | | Investment properties | 40,173,068 | 1,944,607 | (38,228,461) | Movements in Property, Plant and Equipment, Intangible Assets and Investment Properties (H1 2023) | Item (H1 2023) | Property, Plant and Equipment (HKD) | Intangible Assets (HKD) | Investment Properties (HKD) | | :--- | :-------------------- | :---------------- | :-------------- | | Additions | 423,361,914 | 21,069,144 | – | | Depreciation and amortisation | (581,279,157) | (52,182,487) | (1,179,568) | | Exchange differences | (328,937,354) | (63,111,042) | 136,050 | - The Group capitalized **HKD 4,657,008** in borrowing costs for qualifying assets during the period[39](index=39&type=chunk) [Leases](index=20&type=section&id=Leases) As of June 30, 2023, total right-of-use assets amounted to **HKD 1,187.5 million**, primarily comprising land use rights and buildings, with total lease liabilities of **HKD 167.7 million** and **HKD 46.4 million** in depreciation expenses for right-of-use assets in H1 2023 Lease Assets and Liabilities | Lease Item | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | | :--- | :-------------------- | :-------------------- | | Total right-of-use assets | 1,187,497,196 | 1,221,438,469 | | Lease liabilities (current) | 56,920,198 | 55,585,120 | | Lease liabilities (non-current) | 110,813,556 | 99,385,024 | | **Total lease liabilities** | **167,733,754** | **154,970,144** | Depreciation of Right-of-Use Assets | Depreciation of Right-of-Use Assets | H1 2023 (HKD) | H1 2022 (HKD) | | :--- | :-------------------- | :-------------------- | | Land use rights | 13,754,117 | 14,708,869 | | Buildings | 31,004,331 | 37,551,906 | | Equipment and others | 1,659,322 | 1,177,424 | | **Total depreciation** | **46,417,770** | **53,438,199** | [Trade and Bills Receivables, Other Receivables and Prepayments](index=21&type=section&id=Trade%20and%20Bills%20Receivables%2C%20Other%20Receivables%20and%20Prepayments) As of June 30, 2023, net trade and bills receivables increased to **HKD 2,503.2 million**, with most (HKD 2,261.3 million) aged within three months, while other receivables and prepayments also increased, and customers are generally granted **60 to 90 days of credit** Trade and Bills Receivables, Other Receivables and Prepayments Summary | Receivable Item | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Trade and bills receivables - net | 2,503,218,417 | 2,339,665,339 | 7.0% | | Other receivables | 569,562,229 | 483,237,455 | 17.9% | | Prepayments | 122,752,314 | 100,093,982 | 22.6% | Ageing of Trade Receivables (by invoice date) | Ageing of Trade Receivables (by invoice date) | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | | :--- | :-------------------- | :-------------------- | | Within 3 months | 2,261,252,142 | 2,192,548,789 | | 4 to 6 months | 109,486,333 | 104,836,574 | | 7 to 12 months | 25,251,087 | 25,336,069 | | Over 1 year | 43,969,679 | 45,051,511 | - Customers are generally granted credit terms of **60 to 90 days**[43](index=43&type=chunk) [Trade and Other Payables and Accruals](index=22&type=section&id=Trade%20and%20Other%20Payables%20and%20Accruals) As of June 30, 2023, total trade and other payables and accruals significantly decreased by **33.9% to HKD 4,989.7 million**, primarily due to a substantial reduction in trade payables from **HKD 4,500.4 million to HKD 2,160.8 million**, with most trade payables and bills (HKD 1,717.6 million) aged within three months Trade and Other Payables and Accruals Summary | Payable Item | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Trade payables | 2,160,801,128 | 4,500,445,917 | -52.0% | | Bills payables | 360,476,368 | 321,486,143 | 12.1% | | Other payables | 811,844,152 | 994,537,691 | -18.4% | | Accruals | 1,617,117,540 | 1,686,454,983 | -4.1% | | **Total** | **4,989,683,277** | **7,548,972,120** | **-33.9%** | Ageing of Trade and Bills Payables (by invoice date) | Ageing of Trade and Bills Payables (by invoice date) | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | | :--- | :-------------------- | :-------------------- | | Within 3 months | 1,717,609,943 | 4,221,075,633 | | 4 to 6 months | 802,901,499 | 588,864,427 | | 7 to 12 months | 679,703 | 10,834,808 | | Over 1 year | 86,351 | 1,157,192 | - Credit terms granted by creditors generally range from **30 to 180 days**[44](index=44&type=chunk) [Borrowings](index=23&type=section&id=Borrowings) As of June 30, 2023, total Group borrowings significantly increased by **42.8% to HKD 5,551.6 million**, driven by substantial increases in both non-current and current bank borrowings, with **HKD 3,387.4 million** in new borrowings during the period Borrowings Breakdown | Borrowing Type | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Non-current bank borrowings | 3,968,774,941 | 2,800,715,036 | 41.7% | | Non-current related party loans | 84,123,300 | 88,282,378 | -4.7% | | Current bank borrowings | 1,198,680,882 | 299,246,812 | 300.6% | | Current related party loans | 300,000,000 | 700,000,000 | -57.1% | | **Total borrowings** | **5,551,579,123** | **3,888,244,226** | **42.8%** | Borrowings Movement (H1 2023) | Borrowings Movement (H1 2023) | Amount (HKD) | | :--- | :---------- | | Balance as of Jan 1, 2023 | 3,888,244,226 | | New borrowings | 3,387,417,462 | | Repayment of borrowings | (1,160,754,777) | | Repayment of related party loans | (400,000,000) | | Exchange differences | (163,327,788) | | **Balance as of June 30, 2023** | **5,551,579,123** | [Long-Term Incentive Schemes](index=24&type=section&id=Long-Term%20Incentive%20Schemes) The Group operates two cash-settled long-term incentive schemes for employees, senior management, and directors, with **12,358,000** and **11,195,000** option equivalent units granted under Scheme One (vesting until October 2023) and Scheme Two (vesting until October 2025) respectively, and a **HKD 2 million expense** in H1 2023 Long-Term Incentive Schemes Details | Incentive Scheme | Approval Date | Number of Units Granted | Vesting Period | Fair Value as of June 30, 2023 (HKD per unit) | | :--- | :--- | :--- | :--- | :--- | | Scheme One | Sep 17, 2020 | 12,358,000 | Oct 30, 2020 - Oct 30, 2023 | 3.60 (Management), 3.59 (Directors and Senior Management) | | Scheme Two | Jul 20, 2022 | 11,195,000 | Nov 1, 2022 - Oct 31, 2025 | 4.64 (Management, Directors and Senior Management) | Long-Term Incentive Scheme Expense | Metric | H1 2023 (million HKD) | H1 2022 (million HKD) | | :--- | :-------------------- | :-------------------- | | Long-term incentive scheme expense | 2 | 10 | [Other Information](index=25&type=section&id=Other%20Information) This section covers additional disclosures including foreign exchange and interest rate risks, liquidity, financial resources, borrowings, corporate governance, and committee structures [Foreign Exchange and Fair Value Interest Rate Risk](index=25&type=section&id=Foreign%20Exchange%20and%20Fair%20Value%20Interest%20Rate%20Risk) The Group's assets and sales are primarily in Mainland China, Hong Kong, Malaysia, Taiwan, and Korea, with transactions in various currencies, but significant exposure to foreign exchange and interest rate risks due to US dollar-denominated raw material imports and multi-currency borrowings - Group assets and sales operations are primarily located in Mainland China, Hong Kong, Malaysia, Taiwan, and Korea, with transactions denominated in multiple currencies[51](index=51&type=chunk) - Major raw materials are imported and paid in **US dollars**, and most long-term and short-term borrowings are denominated in **RMB, HKD, or US dollars**, exposing the Group to foreign exchange and interest rate risks[51](index=51&type=chunk) [Liquidity, Financial Resources and Borrowings](index=25&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Borrowings) As of June 30, 2023, the Group maintained a sound financial position with **HKD 838.1 million in cash and bank balances**, but total borrowings increased to **HKD 5,551.6 million**, leading to a higher net gearing ratio of **43.1%**, with approximately **HKD 6.95 billion** in unused credit facilities Liquidity and Borrowings Summary | Metric | As of June 30, 2023 (HKD) | As of Dec 31, 2022 (HKD) | Change (%) | | :--- | :-------------------- | :-------------------- | :------- | | Bank and cash balances | 838,118,380 | 606,947,407 | 38.1% | | Total short-term and long-term borrowings | 5,551,579,123 | 3,888,244,226 | 42.8% | | Proportion of long-term borrowings | 73.0% | 74.3% | -1.3 percentage points | Net Gearing Ratio | Metric | As of June 30, 2023 | As of Dec 31, 2022 | Change (percentage points) | | :--- | :------------ | :------------- | :------------ | | Net gearing ratio | 43.1% | 28.6% | 14.5 | - As of **June 30, 2023**, unused credit facilities amounted to approximately **HKD 6.95 billion**[52](index=52&type=chunk) [Charge on Group Assets](index=26&type=section&id=Charge%20on%20Group%20Assets) As of June 30, 2023, the Group had no assets pledged - As of **June 30, 2023**, the Group had **no assets pledged**[53](index=53&type=chunk) [Contingent Liabilities](index=26&type=section&id=Contingent%20Liabilities) As of June 30, 2023, the Group had no significant contingent liabilities - As of **June 30, 2023**, the Group had **no significant contingent liabilities**[53](index=53&type=chunk) [Interim Dividend](index=26&type=section&id=Interim%20Dividend) The Board resolved to declare an interim dividend of **HKD 0.10 per share** for the period, totaling approximately **HKD 120.33 million**, payable on or around September 7, 2023, to shareholders registered on August 24, 2023 Interim Dividend Details | Metric | H1 2023 | H1 2022 | | :--- | :----------- | :----------- | | Interim dividend per share (HKD) | 0.10 | 0.10 | | Total interim dividend (HKD) | 120,328,537 | 120,327,537 | | Payment date | On or around Sep 7, 2023 | N/A | | Shareholder registration date | Aug 24, 2023 | N/A | [Closure of Register of Members](index=26&type=section&id=Closure%20of%20Register%20of%20Members) The Company's share transfer registration will be suspended from **August 22 to August 24, 2023**, inclusive, to determine eligibility for the interim dividend, with all transfer documents to be submitted by **4:30 p.m. on August 21, 2023** - Share transfer registration will be suspended from **August 22 to August 24, 2023**, inclusive, to determine eligibility for the interim dividend[55](index=55&type=chunk) - All transfer documents must be submitted by **4:30 p.m. on August 21, 2023**[55](index=55&type=chunk) [Purchase, Sale or Redemption of Securities](index=26&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Securities) Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares during the period - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares during the period[56](index=56&type=chunk) [Corporate Governance](index=26&type=section&id=Corporate%20Governance) The Company is committed to maintaining high standards of corporate governance, having adopted the principles of the Corporate Governance Code in Appendix 14 of the HKEX Listing Rules, and has complied with all code provisions during the period - The Company is committed to maintaining **high standards of corporate governance practices** and has adopted the principles of the Corporate Governance Code in Appendix 14 of the HKEX Listing Rules[56](index=56&type=chunk) - The Company has complied with all code provisions of the Corporate Governance Code during the period[56](index=56&type=chunk) [Directors' Securities Transactions](index=27&type=section&id=Directors%27%20Securities%20Transactions) The Company has adopted a code for directors' securities transactions, with terms no less exacting than the Model Code in Appendix 10 of the Listing Rules, and all directors confirmed compliance with the standards during the period - The Company has adopted a code for directors' securities transactions, with terms no less exacting than the Model Code set out in Appendix 10 of the Listing Rules[57](index=57&type=chunk) - All directors confirmed compliance with the standards for directors' securities transactions as stipulated in the Model Code and the Code of Conduct during the period[57](index=57&type=chunk) [Audit Committee](index=27&type=section&id=Audit%20Committee) The Audit Committee, comprising four members (three independent non-executive directors and one non-executive director) and chaired by Mr. Xu Jinghui, reviews and monitors financial reporting, internal audit, internal controls, and risk assessment, having reviewed the Company's unaudited interim results and report for the period - The Audit Committee comprises **four members**, including three independent non-executive directors and one non-executive director, chaired by **Mr. Xu Jinghui**[58](index=58&type=chunk) - Its primary responsibilities include reviewing and monitoring financial reporting procedures, and assessing the effectiveness of internal audit, internal controls, and risk assessment[58](index=58&type=chunk) - The Company's unaudited interim results and interim report for the period have been reviewed by the Audit Committee[58](index=58&type=chunk) [Remuneration Committee](index=27&type=section&id=Remuneration%20Committee) The Remuneration Committee, consisting of five members (three independent non-executive directors and two non-executive directors) and chaired by Mr. Xu Jinghui, is responsible for formulating the Group's remuneration policy, recommending compensation to the Board, and determining specific remuneration packages for senior management based on various factors - The Remuneration Committee comprises **five members**, including three independent non-executive directors and two non-executive directors, chaired by **Mr. Xu Jinghui**[59](index=59&type=chunk) - Responsible for formulating the Group's remuneration policy, recommending remuneration to the Board, and determining specific remuneration packages for senior management[59](index=59&type=chunk) - Factors considered include remuneration in comparable companies, time and responsibility contributed by directors and senior management, employment conditions for other Group positions, and the appropriateness of performance-linked remuneration[59](index=59&type=chunk) [Nomination Committee](index=28&type=section&id=Nomination%20Committee) The Nomination Committee, composed of five members (three independent non-executive directors, one executive director, and one non-executive director) and chaired by Mr. Li Chao Wang, is responsible for recommending suitable qualified individuals for directorships and regularly reviewing the Board's structure, size, diversity, and composition - The Nomination Committee comprises **five members**, including three independent non-executive directors, one executive director, and one non-executive director, chaired by **Mr. Li Chao Wang**[60](index=60&type=chunk) - Its primary responsibilities are to recommend suitable qualified individuals for directorships to the Board and to regularly review the Board's structure, size, diversity, and composition[60](index=60&type=chunk) [Risk Management Committee](index=28&type=section&id=Risk%20Management%20Committee) The Risk Management Committee, consisting of five members (two executive, two non-executive, and one independent non-executive director) and chaired by Mr. Jan Christer JOHANSSON, assists the Board in determining the Group's risk appetite, advises on significant decisions affecting the risk portfolio, and reviews identified key risks and mitigation measures - The Risk Management Committee comprises **five members**, including two executive directors, two non-executive directors, and one independent non-executive director, chaired by **Mr. Jan Christer JOHANSSON**[61](index=61&type=chunk) - Its primary responsibilities are to assist the Board in determining the Group's risk level and acceptable risk appetite, advise on significant decisions affecting the Group's risk portfolio, and review identified key risks and mitigation measures[61](index=61&type=chunk) [Executive Committee](index=28&type=section&id=Executive%20Committee) The Executive Committee, composed of four executive directors and chaired by Mr. Li Chao Wang, is responsible for formulating and recommending the Company's annual budget, capital expenditure budget, and major business plans to the Board, as well as deliberating and approving reorganizations, significant asset disposal plans, and individual annual salary increments for senior officers - The Executive Committee comprises **four executive directors**, chaired by **Mr. Li Chao Wang**[62](index=62&type=chunk) - Responsibilities include formulating and recommending the annual budget, capital expenditure budget, and major business plans to the Board, as well as deliberating and approving reorganizations, significant asset disposal plans, and annual salary increments for senior officers[62](index=62&type=chunk) [Strategy Development Committee](index=29&type=section&id=Strategy%20Development%20Committee) The Strategy Development Committee, consisting of five members (two executive, two non-executive, and one independent non-executive director) and chaired by Mr. Jan Christer JOHANSSON, advises the Board/Executive Committee on the Group's medium-to-long-term strategic positioning, business plans, brand strategy, investment decisions, and M&A, while overseeing and reviewing strategy implementation - The Strategy Development Committee comprises **five members**, including two executive directors, two non-executive directors, and one independent non-executive director, chaired by **Mr. Jan Christer JOHANSSON**[63](index=63&type=chunk) - Its primary responsibilities are to advise the Board/Executive Committee on the Group's medium-to-long-term strategic positioning, business plans, brand strategy, investment decisions, and mergers and acquisitions[63](index=63&type=chunk) - Oversees and reviews the implementation of strategic plans and provides recommendations[63](index=63&type=chunk) [Publication of Results Announcement and Interim Report](index=29&type=section&id=Publication%20of%20Results%20Announcement%20and%20Interim%20Report) This announcement has been published on the Company's website (www.vinda.com) and the HKEX website (www.hkexnews.hk), with the 2023 Interim Report to be dispatched to shareholders and published on these websites in due course - The results announcement has been published on the Company's website and the HKEX website[64](index=64&type=chunk) - The 2023 Interim Report will be dispatched to shareholders and published on the websites in due course[64](index=64&type=chunk) [Acknowledgement](index=29&type=section&id=Acknowledgement) The Board, on behalf of all directors, extends its gratitude to all employees for their hard work and dedication during the period - The Board extends its gratitude to all employees for their hard work and dedication during the period[64](index=64&type=chunk) [Board of Directors](index=30&type=section&id=Board%20of%20Directors) As of the announcement date, the Board comprises four executive, four non-executive, and four independent non-executive directors, along with two alternate directors, with Mr. Li Chao Wang serving as Chairman - The Board comprises **four executive directors**, **four non-executive directors**, and **four independent non-executive directors**, along with **two alternate directors**[66](index=66&type=chunk) - **Mr. Li Chao Wang** serves as the Chairman of the Board[65](index=65&type=chunk)[66](index=66&type=chunk)

Revenue Performance - Total revenue for the first quarter of 2023 increased by 15.5% at constant exchange rates, amounting to HKD 4,969 million, with HKD 4,071 million from the tissue segment and HKD 898 million from personal care[2] Profitability Metrics - Gross profit decreased by 17.1% to HKD 1,254 million, with a gross profit margin narrowing by 7.9 percentage points to 25.2%[2] - Operating profit fell by 85.4% to HKD 65 million, with the operating profit margin contracting by 8.5 percentage points to 1.3%[2] - EBITDA decreased by 47.2% to HKD 412 million, with an EBITDA margin of 8.3%, down by 8.8 percentage points[2] - Net profit decreased by 88.4% to HKD 40 million, with a net profit margin declining by 6.7 percentage points to 0.8%[2] Foreign Exchange Impact - The total foreign exchange loss amounted to HKD 7.7 million, compared to a gain of HKD 11.8 million in the same period last year[2]