香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負 責，對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部 或任何部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Ruihe Data Technology Holdings Limited 瑞和數智科技控股有限公司 （於開曼群島註冊成立之有限公司） （股份代號：3680） (1)董事辭職； (2)董事調任； (3)董事委任； (4)董事委員會組成變動；及 (5)未遵守上市規則 董事會謹此宣佈以下董事會變動，自二零二五年三月四日起生效： – 1 – 1. 陳楨平先生已辭任非執行董事； 2. 楊海峰先生已辭任獨立非執行董事、審核委員會及薪酬委員會各自之主 席及提名委員會成員； 3. 金涌博士已辭任獨立非執行董事及審核委員會及提名委員會各自之成員； 4. 費翔先生已由執行董事調任為非執行董事； 5. 孫得鑫先生已獲委任為執行董事； (1) 董事辭任 瑞 和 數 智 科 技 控 股 有 限 公 司（「本公司」，連 同 其 附 屬 公 司 統 稱「本集團」）董 事（「董 事」）會（「董事會」）謹 此 宣 佈，於 二 零 二 ...

香港交 易 及結算所有限公司及香港聯合交 易 所有限公司對本公告的內容概不負 責，對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部 或任何部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Ruihe Data Technology Holdings Limited 瑞和數智科技控股有限公司 更改香港主要營業地點的地址 瑞 和 數 智 科 技 控 股 有 限 公 司（「本公司」）董 事 會（「董事會」）謹 此 宣 佈，由 二 零 二 五 年 一 月 十 日 起，本 公 司 於 香 港 的 主 要 營 業 地 點 的 地 址 將 更 改 為 香 港 銅 鑼 灣 希 慎 道33號利園一期19樓1928室。 承董事會命 瑞和數智科技控股有限公司 董事會主席 （於開曼群島註冊成立之有限公司） （股份代號：3680） 香港，二零二五年一月九日 於本公告日期，董事會包括三名執行董事：薛守光先生、趙藝晴女士及費翔先生； 三名非執行董事：吳輔世博士、吳曉華先生及陳楨平先生；及三名獨立非執行董 事：楊海峰先生、金涌博士及田宇博士。 薛守光 ...

Corporate Information [Corporate Profile](index=2&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) The company provides essential corporate details, including its board, committees, and key advisors - The company's name was changed from "Sumpo Food Holdings Limited" to "Ruihe Data & Intelligence Technology Holdings Limited"[1](index=1&type=chunk) - The roles of Chairman and CEO are held by the same individual, Mr. Xue Shouguang[3](index=3&type=chunk)[4](index=4&type=chunk) Financial Highlights [Financial Performance Summary](index=5&type=section&id=%E8%B2%A1%E5%8B%99%E6%A6%82%E8%A6%81) Revenue grew significantly while net loss narrowed due to new business lines and effective cost controls Key Financial Metrics for H1 2024 | Metric | H1 2024 (RMB) | H1 2023 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | **Operating Revenue** | 181 million | 121 million | +49.4% | | **Gross Profit** | 14.58 million | 25.30 million | -42.4% | | **Net Loss** | 38.64 million | 63.18 million | -38.8% (Loss Narrowed) | | **Basic Loss Per Share** | 5.48 cents | 12.40 cents | -55.8% (Loss Narrowed) | - Revenue growth was primarily driven by a **115.7% increase** in sales of software, hardware, and related integrated services and the new commodity trading business, which contributed approximately **RMB 61.72 million** in revenue[10](index=10&type=chunk) - The narrowed net loss was mainly due to reduced impairment provisions for financial and contract assets, lower selling and R&D expenses, and no impairment loss on intangible assets[10](index=10&type=chunk)[11](index=11&type=chunk) Management Discussion and Analysis [Business Review](index=6&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group is transitioning into a digital intelligence service provider by expanding into new data-related sectors [Industry Background Analysis](index=6&type=section&id=%E8%A1%8C%E6%A5%AD%E8%83%8C%E6%99%AF%E5%88%86%E6%9E%90) National policies supporting the digital economy and AI are creating significant market opportunities for the Group - National policies, such as the "Data Elements ×" Three-Year Action Plan, provide strong support for industry development, heralding the era of data element industrialization[13](index=13&type=chunk)[14](index=14&type=chunk) Relevant Market Size Forecasts | Market | Forecasting Body | Forecast Size | | :--- | :--- | :--- | | **China's Digital Economy Market** | China Research and Intelligence Co., Ltd. | Expected to reach RMB 70.8 trillion by 2025 | | **China's Data Element Market** | China Center for Information Industry Development | Expected to approach RMB 200 billion by 2025 | | **China's Banking IT Solutions Market** | IDC & CCID Consulting | Will reach RMB 139.011 billion by 2026 | [H1 2024 Performance Review](index=7&type=section&id=%E4%BA%8C%E9%9B%B6%E4%BA%8C%E5%9B%9B%E5%B9%B4%E4%B8%8A%E5%8D%8A%E5%B9%B4%E6%A5%AD%E7%B8%BE%E5%9B%9E%E9%A0%AD) The Group solidified its core business while expanding into new data asset applications through key partnerships - To consolidate existing business, the Group continued its deep cooperation with a large state-owned bank's head office and successfully renewed contracts and won bids with other city and rural commercial banks[20](index=20&type=chunk) - To expand into new sectors, the Group co-invested **RMB 100 million** to establish a partnership for data asset innovation and signed a strategic cooperation with the Quanzhou Licheng District government[20](index=20&type=chunk) - As of June 30, 2024, the Group had applied for **244 national intellectual property certificates**, including 47 invention patents and 140 software copyrights[21](index=21&type=chunk) - The Group actively built an ecosystem by releasing joint solutions with tech companies like Alibaba Cloud and Huawei and co-authoring a white paper on regional bank data capabilities[22](index=22&type=chunk) [Future Outlook](index=10&type=section&id=%E6%9C%AA%E4%BE%86%E5%B1%95%E6%9C%9B) The Group will focus on AI, data asset accounting, and domestic IT substitution to become a leading service provider - Product Innovation: Focusing on R&D for AI big data, AI, and large model products to continuously upgrade core offerings[28](index=28&type=chunk) - Sector Expansion: Seizing market opportunities in data element innovation, data asset accounting, and domestic IT substitution to provide integrated hardware and software solutions[28](index=28&type=chunk) - Customer Service: Establishing cross-departmental resource coordination mechanisms and strengthening cooperation with government, enterprises, and universities[29](index=29&type=chunk) - Ecosystem Cooperation: Deepening strategic partnerships with internet giants like Huawei Cloud, Alibaba Cloud, and Baidu Cloud, and enhancing collaboration with industry partners[29](index=29&type=chunk) [Financial Review](index=12&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) Revenue grew while gross margin declined due to business mix changes, but net loss narrowed from cost controls [Revenue Analysis](index=12&type=section&id=%E6%94%B6%E7%9B%8A) Total revenue growth was driven by new business segments, offsetting declines in traditional data solutions Revenue Breakdown (RMB '000) | Business Segment | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Data Solutions | 68,491 | 88,885 | -22.9% | | Sales of Software, Hardware & Related Integrated Services | 46,968 | 21,771 | +115.7% | | IT Maintenance & Support Services | 3,832 | 10,470 | -63.4% | | Commodity Trading | 61,720 | 0 | N/A | | **Total** | **181,011** | **121,126** | **+49.4%** | [Gross Profit and Gross Margin Analysis](index=13&type=section&id=%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) Gross profit and margin declined significantly due to a revenue mix shift toward lower-margin businesses - Gross profit was approximately **RMB 14.58 million**, a decrease of RMB 10.73 million (**-42.4%**) year-over-year[33](index=33&type=chunk) - Gross profit margin was approximately **8.1%**, compared to 20.9% in the same period last year[33](index=33&type=chunk) [Expense Analysis](index=13&type=section&id=%E9%96%8B%E6%94%AF%E5%88%86%E6%9E%90) The Group effectively controlled operating expenses, with significant reductions in selling and R&D costs Key Expense Changes (RMB '000) | Item | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Selling Expenses | 5,528 | 11,333 | -51.2% | | R&D Expenses | 19,449 | 22,934 | -15.2% | | Administrative Expenses | 24,053 | 23,678 | +1.6% | [Loss for the Period Analysis](index=14&type=section&id=%E6%9C%9F%E5%85%A7%E8%99%A7%E6%90%8D) Net loss narrowed significantly due to lower impairment provisions and reduced operating expenses - Impairment provisions for financial and contract assets decreased by approximately **RMB 8.52 million** year-over-year[38](index=38&type=chunk) - Selling expenses decreased by approximately **RMB 5.81 million** year-over-year[38](index=38&type=chunk) - R&D expenses decreased by approximately **RMB 3.49 million** year-over-year[38](index=38&type=chunk) - No impairment loss on intangible assets was recorded in the period, compared to an impairment loss of approximately **RMB 12 million** in the prior-year period[38](index=38&type=chunk) [Liquidity and Cash Flow Analysis](index=15&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E6%94%BF%E4%BE%86%E6%BA%90) Operating cash outflow narrowed, while financing cash flow turned negative due to the absence of share issuance proceeds Cash Flow Statement Summary (RMB '000) | Activity | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Net Cash from Operating Activities | (32,104) | (51,588) | | Net Cash from Investing Activities | (5,308) | (698) | | Net Cash from Financing Activities | (7,228) | 106,448 | [Capital Structure and Gearing](index=15&type=section&id=%E8%B3%87%E6%9C%AC%E7%B5%90%E6%A7%8B) The gearing ratio rose to 216.4% as total borrowings remained high while total equity decreased - As of June 30, 2024, borrowings included **RMB 66.74 million** in short-term bank loans, **RMB 95 million** in other borrowings, and **RMB 10 million** in long-term bank loans[47](index=47&type=chunk) - The gearing ratio increased to **216.4%** (end-2023: 150.2%), primarily due to a decrease in total equity of approximately **RMB 36.83 million** during the period[53](index=53&type=chunk) - Bank borrowings are secured by pledged bank deposits, certain trade receivables, assets owned by a director, and personal guarantees[54](index=54&type=chunk) Corporate Governance and Other Information [Directors', Chief Executive's and Substantial Shareholders' Interests](index=18&type=section&id=%E8%91%A3%E4%BA%8B%E3%80%81%E6%9C%80%E9%AB%98%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%8C%81%E8%82%A1) This section details the shareholdings of directors and substantial shareholders as of June 30, 2024 Interests of Directors and Chief Executive (Long Positions) | Name | Capacity/Nature of Interest | Number of Shares | Approx. Shareholding (%) | | :--- | :--- | :--- | :--- | | Mr. Xue Shouguang | Interest in a controlled corporation | 104,000,000 | 15.74 | | Mr. Chen Zhenping | Beneficial interest | 60,980,000 | 9.23 | | Mr. Wu Xiaohua | Interest in a controlled corporation | 29,490,000 | 4.46 | | Ms. Zhao Yiqing | Beneficial interest | 23,740,000 | 3.59 | | Dr. Wu Fushi | Beneficial interest | 11,450,000 | 1.73 | - Substantial shareholders (non-directors) include Treasure Tree Asia Holdings Co. LTD (15.74%), Mr. Wang Donglin (through a controlled corporation, 10.59%), and Beijing Financial Street Capital Operation Group Co., Ltd. (as a security interest holder, 10.00%)[64](index=64&type=chunk) [Remuneration Policy and Equity Incentive Plans](index=20&type=section&id=%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96%E5%8F%8A%E8%82%A1%E6%AC%8A%E6%BF%80%E5%8B%B5%E8%A8%88%E5%8A%83) The Group maintains competitive remuneration policies and equity incentive plans to retain its 398 employees - As of June 30, 2024, the Group had a total of **398 employees** in Mainland China and Hong Kong[70](index=70&type=chunk) - The Company adopted a Share Option Scheme and a Share Award Scheme on June 8, 2020[71](index=71&type=chunk) - During the period, **432,464** restricted shares vested and **110,747** shares lapsed under the Share Award Scheme[80](index=80&type=chunk) [Use of Net Proceeds from Share Offer](index=25&type=section&id=%E8%82%A1%E4%BB%BD%E7%99%BC%E5%94%AE%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E6%B7%A8%E9%A1%8D%E4%B9%8B%E7%94%A8%E9%80%94) The net proceeds of approximately HK$104 million from the 2019 listing have been fully utilized Allocation and Use of Net Proceeds (HKD Million) | Purpose | Allocated Amount | Utilized Amount | Unutilized Amount | | :--- | :--- | :--- | :--- | | Enhance data solution portfolio | 20.8 | 20.8 | 0 | | Enhance sales and marketing | 20.8 | 20.8 | 0 | | Develop financial AI lab and other facilities | 36.4 | 36.4 | 0 | | Potential strategic acquisitions | 6.6 | 6.6 | 0 | | Working capital and other | 19.4 | 19.4 | 0 | | **Total** | **104.0** | **104.0** | **0** | [Other Information](index=26&type=section&id=%E5%85%B6%E4%BB%96%E4%BF%A1%E6%81%AF) The company complied with governance codes, with no interim dividend declared and sufficient public float maintained - The Board does not recommend the payment of an interim dividend for 2024[87](index=87&type=chunk) - The roles of Chairman and CEO are both held by Mr. Xue Shouguang, a deviation from the Corporate Governance Code which the Board believes ensures consistent leadership[84](index=84&type=chunk) - During the period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[82](index=82&type=chunk) - The Audit Committee has reviewed the Group's unaudited interim condensed consolidated financial information[91](index=91&type=chunk) Interim Financial Statements [Interim Condensed Consolidated Statement of Comprehensive Income](index=28&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The company reported a significantly narrowed net loss of RMB 38.64 million on revenue of RMB 181 million Summary of Consolidated Statement of Comprehensive Income (RMB '000) | Item | H1 2024 (Unaudited) | H1 2023 (Unaudited) | | :--- | :--- | :--- | | Revenue | 181,011 | 121,126 | | Gross Profit | 14,577 | 25,302 | | Operating Loss | (32,320) | (64,628) | | Loss before Income Tax | (39,108) | (64,628) | | **Loss for the Period** | **(38,635)** | **(63,176)** | | Loss attributable to Owners of the Company | (36,040) | (62,141) | [Interim Condensed Consolidated Statement of Financial Position](index=29&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) The company reported total assets of RMB 383 million and net current liabilities of RMB 36.40 million Summary of Consolidated Statement of Financial Position (RMB '000) | Item | Jun 30, 2024 (Unaudited) | Dec 31, 2023 (Audited) | | :--- | :--- | :--- | | **Total Assets** | **382,941** | **444,148** | | Non-current Assets | 130,665 | 141,519 | | Current Assets | 252,276 | 302,629 | | **Total Liabilities** | **302,460** | **326,841** | | Non-current Liabilities | 13,781 | 16,829 | | Current Liabilities | 288,679 | 310,012 | | **Total Equity** | **80,481** | **117,307** | | Net Current Liabilities | (36,403) | (7,383) | [Interim Condensed Consolidated Statement of Changes in Equity](index=31&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) Total equity decreased to RMB 80.48 million, primarily due to a total comprehensive loss of RMB 37.01 million - Total equity at the beginning of the period was **RMB 117.3 million**[101](index=101&type=chunk) - Total comprehensive loss for the period was **RMB 37.01 million**, comprising a loss for the period of RMB 38.64 million and an exchange difference gain of RMB 1.62 million[101](index=101&type=chunk) - Total equity at the end of the period was **RMB 80.48 million**[101](index=101&type=chunk) [Interim Condensed Consolidated Statement of Cash Flows](index=32&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) Cash and cash equivalents decreased by RMB 44.64 million, resulting in a closing balance of RMB 70.23 million Summary of Consolidated Statement of Cash Flows (RMB '000) | Item | H1 2024 (Unaudited) | H1 2023 (Unaudited) | | :--- | :--- | :--- | | Net cash used in operating activities | (32,104) | (51,588) | | Net cash used in investing activities | (5,308) | (698) | | Net cash from/(used in) financing activities | (7,228) | 106,448 | | **Net (decrease)/increase in cash and cash equivalents** | **(44,640)** | **54,162** | | Cash and cash equivalents at beginning of period | 113,257 | 57,480 | | **Cash and cash equivalents at end of period** | **70,232** | **110,468** | Notes to the Interim Condensed Consolidated Financial Statements [Note 6: Revenue and Segment Information](index=37&type=section&id=6%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group operates two segments, with Integrated Data Technology Services contributing most of the revenue Segment Performance (H1 2024, RMB '000) | Segment | Revenue | (Loss)/Profit | | :--- | :--- | :--- | | Integrated Data Technology Services | 119,291 | (37,025) | | Commodity Trading | 61,720 | (64) | | **Total** | **181,011** | **(37,089)** | - By revenue recognition timing, **RMB 109 million** was recognized at a point in time, and **RMB 72.32 million** was recognized over time[123](index=123&type=chunk) [Note 13: Trade and Bills Receivables](index=44&type=section&id=13%20%E8%B2%A1%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%87%89%E6%94%B6%E7%A5%A8%E6%93%9A) Net trade and bills receivables stood at RMB 91.14 million, with a significant portion aged over one year Aging Analysis of Trade and Bills Receivables (RMB '000) | Aging | Jun 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Up to 3 months | 65,198 | 95,467 | | 3 to 6 months | 1,464 | 2,082 | | 6 months to 1 year | 26,183 | 9,073 | | Over 1 year | 62,500 | 59,974 | | **Total** | **155,345** | **166,596** | - The Group uses a lifetime expected loss provision model for trade and bills receivables, assessed based on customer credit risk and forward-looking information[147](index=147&type=chunk) [Note 19: Bank and Other Borrowings](index=51&type=section&id=19%20%E9%8A%80%E8%A1%8C%E5%8F%8A%E5%85%B6%E4%BB%96%E5%80%9F%E8%B2%B8) Total borrowings amounted to RMB 172 million, primarily secured by various corporate and personal assets Composition of Bank and Other Borrowings (RMB '000) | Item | Jun 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | **Non-current** | | | | Bank borrowings | 10,000 | 10,000 | | **Current** | | | | Bank borrowings | 66,744 | 64,728 | | Other borrowings | 95,000 | 101,464 | | **Total** | **171,744** | **176,192** | - The weighted average annual interest rate for bank borrowings was **4.3%**[159](index=159&type=chunk) - At the end of 2023, a convertible loan with a principal of **RMB 20 million** was reclassified to other borrowings after the investor decided not to exercise the conversion option and demanded repayment[162](index=162&type=chunk)

Financial Performance - The company's revenue for the six months ended June 30, 2024, was approximately RMB 181,011,000, representing an increase of about 49.4% or approximately RMB 59,885,000 compared to the same period in 2023[1]. - The gross profit for the reporting period was approximately RMB 14,577,000, a decrease of about 42.4% compared to RMB 25,302,000 in the first half of 2023[1][3]. - The net loss for the reporting period was approximately RMB 38,635,000, a reduction of 38.8% or about RMB 24,541,000 compared to RMB 63,176,000 in the same period last year[2][4]. - Basic and diluted loss per share decreased by 55.8% to RMB 5.48 from RMB 12.40 in the first half of 2023[2][4]. - Total revenue for the six months ended June 30, 2024, was RMB 181,011,000, an increase from RMB 121,126,000 in the same period of 2023, representing a growth of 49.4%[10]. - Revenue from integrated data technology services was RMB 119,291,000, slightly down from RMB 121,126,000 year-on-year, indicating a decrease of 1.5%[10]. - Revenue from commodity trading reached RMB 61,720,000, with no revenue reported in the previous year, marking a significant new revenue stream[10]. - The company reported a net loss of RMB 38,635,000 for the six months ended June 30, 2024, compared to a net loss of RMB 63,176,000 for the same period in 2023[12]. - The loss attributable to the company's owners for the reporting period was approximately RMB 36,040,000, down from RMB 62,141,000 in the first half of 2023[58]. - Basic and diluted loss per share for the six months ended June 30, 2024, was RMB 5.48, down from RMB 12.40 in the same period of 2023, indicating a 56% reduction in loss per share[18]. Expenses and Cost Management - The company reduced its sales expenses by approximately RMB 5,805,000 to RMB 5,528,000 during the reporting period[2]. - Research and development expenses decreased by approximately RMB 3,485,000 to RMB 19,449,000 as the company shifted focus to product promotion and application[2]. - Employee benefit expenses, including director remuneration, were RMB 56,944,000, down from RMB 100,663,000, a decrease of 43.4%[14]. - Sales expenses were approximately RMB 5,528,000, a decrease of about 51.2% or RMB 5,805,000 compared to the first half of 2023, representing about 3.1% of the company's revenue[53]. - Administrative expenses increased by approximately 1.6% or RMB 375,000 to RMB 24,053,000 compared to the first half of 2023[55]. Assets and Liabilities - The total assets as of June 30, 2024, were RMB 382,941,000, down from RMB 444,148,000 as of December 31, 2023[5]. - The total equity decreased to RMB 80,481,000 from RMB 117,307,000 as of December 31, 2023[5]. - The company reported a total liability of RMB 302,460,000 as of June 30, 2024, down from RMB 326,841,000 at the end of 2023, reflecting a reduction of 7.4%[6]. - Current liabilities decreased to RMB 288,679,000 from RMB 310,012,000, a decline of 6.9%[6]. - The net current liabilities position worsened to (RMB 36,403,000) compared to (RMB 7,383,000) in the previous period, indicating increased financial pressure[6]. - The company's asset-liability ratio increased to approximately 216.4% as of June 30, 2024, up from 150.2% on December 31, 2023[68]. Strategic Initiatives and Business Development - The company is focused on expanding its integrated data technology services and commodity trading as part of its growth strategy[10]. - The company has established strategic partnerships with major internet companies to enhance its digital finance and industry technology ecosystem[50]. - The company is actively exploring new business models and scenarios in the data intelligence field, aiming to transform into a comprehensive service provider[40]. - The company has successfully deepened cooperation with a major state-owned bank, expanding into multiple new business areas, showcasing its market influence in data governance and analytics[41]. - The company has signed strategic cooperation agreements with various partners, including a RMB 100 million investment to explore innovative applications of data assets[43]. Market and Economic Context - China's GDP grew by 5.0% year-on-year in the first half of 2024, with high-tech industry investment increasing by 10.6%[38]. - The government continues to promote policies for modern industrial system construction and the development of new production capacities, focusing on digital economy innovations[38]. - In 2024, China's digital economy market is projected to reach RMB 63.8 trillion, with expectations to grow to RMB 70.8 trillion by 2025, indicating significant growth potential[39]. - The compound annual growth rate (CAGR) of China's data factor market is expected to exceed 25% during the 14th Five-Year Plan period, with a total value projected to reach RMB 159.2 billion in 2024 and nearly RMB 200 billion by 2025[39]. Governance and Compliance - The company has adopted corporate governance principles and has complied with the relevant rules during the reporting period[79]. - The audit committee reviewed the unaudited interim consolidated financial information and confirmed it was prepared in accordance with applicable accounting standards[84]. - The board of directors includes three executive directors and three non-executive directors, along with three independent non-executive directors[86]. - The company emphasizes its focus on shareholder communication and engagement[86]. - The announcement reflects the company's adherence to regulatory requirements for financial disclosures[86].

Stock Options and Share Awards - The company has not granted any new stock options during the reporting period[5]. - The stock option exercise price is determined based on the highest of three values, with the share price on the grant date being HKD 6.33[8]. - The maximum number of restricted shares that can be awarded under the share award plan is capped at 5% of the total issued shares as of June 8, 2020, which amounts to 20,000,000 shares[11]. - The remaining duration of the share award plan as of December 31, 2023, is approximately six years and five months[14]. - The stock options granted to employees are subject to performance conditions, including financial performance targets and individual key performance indicators[6]. - The company aims to retain existing employees and recruit additional staff through the stock option and share award plans[3]. Employee Recruitment and Retention - The company has not experienced any significant issues with employee recruitment or retention during the reporting period[2]. - The company has not encountered any labor disputes that would disrupt operations during the reporting period[2]. Revenue and Customer Concentration - The company generated revenue from its top five customers, accounting for 43.8% of total revenue, with the largest customer contributing 12.1%[28]. Shareholder and Ownership Structure - The company holds 104,000,000 shares, representing approximately 15.74% of total shares, owned by Treasure Tree Asia Holdings Co. LTD[24]. - The company’s major shareholders include individuals and entities with significant stakes, such as 10.59% held by Wang Donglin and related entities[24]. Financial Performance and Proceeds - The net proceeds from the share issuance in December 2019 amounted to approximately HKD 104.0 million after deducting listing expenses[29]. - The company plans to extend the timeline for utilizing the remaining net proceeds of approximately HKD 3.5 million for the development of a financial AI laboratory and office facilities until March 31, 2024[30]. Corporate Governance - The company’s board of directors has been restructured to comply with listing rules, ensuring at least three independent non-executive directors are present[37]. - The company has adopted corporate governance standards to maintain shareholder interests and enhance corporate value[65]. - The board believes that good corporate governance standards are crucial for maintaining transparency and accountability[65]. - The company has adopted the standard code of conduct for securities trading as per the listing rules[38]. - The board consists of 11% female members and 89% male members as of the report date, with a target of 22% female representation by December 31, 2023[121]. Audit and Compliance - The company’s audit committee has reviewed the annual performance and financial statements, confirming compliance with applicable accounting standards[32]. - The audit committee currently consists of three independent non-executive directors, with Mr. Yang Haifeng serving as the chairman[53]. - The audit committee held three meetings during the reporting period to review financial performance and compliance matters[80]. - The company incurred audit service fees of HKD 1,880,000 and non-audit service fees of HKD 250,000, totaling HKD 2,130,000[128]. - The company has a robust internal audit function that evaluates the effectiveness of risk management and internal control systems at least annually[124]. - The board reviewed the effectiveness of the internal control and risk management systems, confirming their adequacy throughout the reporting period[125]. ESG Strategies and Reporting - The board is responsible for the overall governance of the company's ESG strategies and risk management, regularly reviewing performance and objectives[141]. - The ESG report details the company's efforts and achievements in sustainable development and social responsibility, highlighting its commitment to environmental and social policies[168]. - The company reported direct emissions of 19.3 tons from vehicle fuel consumption for the year ending December 31, 2023[191]. - Indirect emissions included 0.9 tons from paper usage and 55.8 tons from business travel by air[192]. - The company aims to integrate ESG factors into decision-making processes and daily operations[169]. - The ESG working group meets regularly to discuss and review ESG-related issues, including policies and performance[170]. Communication and Stakeholder Engagement - The company has established a shareholder communication policy to ensure effective engagement with stakeholders and to address their concerns appropriately[139]. - The company emphasizes the importance of effective communication with shareholders to enhance investor relations and understanding of business performance and strategies[165]. Board Diversity and Composition - The company has adopted a board diversity policy aimed at achieving a balance in skills, experience, and perspectives among board members[91]. - The nomination committee reviews the board diversity policy to ensure its effectiveness[95]. - The company has established measurable goals to implement its board diversity policy and will review these goals periodically[120]. - The company has a total workforce of 140 females and 368 males, resulting in a gender distribution of 28% female and 72% male[121]. Significant Events and Changes - The board of directors has undergone significant changes, with new appointments including Mr. Xue Shouguang as Chairman and CEO, and Ms. Zhao Yiqing as a director, both appointed on July 18, 2023[133]. - The company held two shareholder meetings during the reporting period, including the annual general meeting on May 25, 2023, and a special meeting on October 24, 2023[159]. - There were no significant events affecting the group after December 31, 2023, and up to the date of this report[60].

Financial Performance - The company's revenue for the year ended December 31, 2023, was approximately RMB 367,945,000, a decrease of about 2.4% or RMB 9,181,000 compared to 2022[3]. - The gross profit for the reporting period was approximately RMB 47,127,000, a decrease of about 47.2% compared to 2022, with a gross margin of approximately 12.8%, down 10.9% from 23.7% in 2022[4]. - The net loss for the reporting period was approximately RMB 109,009,000, a reduction of about 12.1% compared to a net loss of RMB 124,022,000 in 2022[4]. - Basic and diluted loss per share for the reporting period was approximately RMB 0.188, compared to RMB 0.309 in 2022, representing a 39% reduction in loss per share[11]. - The company reported a total revenue of RMB 367,945,000 for the year ended December 31, 2023, a decrease of approximately 2.4% or RMB 9,181,000 compared to 2022[151]. - The net loss for the year was RMB 109,009 million, compared to a loss of RMB 124,022 million in 2022[66]. Revenue Breakdown - The integrated service revenue from hardware and software sales increased by approximately 85.7% or RMB 66,739,000 during the reporting period[3]. - Data solutions revenue decreased by approximately 37.6% or RMB 100,574,000, while IT maintenance and support service revenue fell by approximately 46.2% or RMB 14,598,000[4]. - Revenue from integrated software and hardware sales and related services increased by approximately 85.7% or RMB 66,739,000 during the reporting period[153]. - Revenue from data solutions decreased by approximately 37.6% or RMB 100,574,000 due to tightening IT and marketing budgets among large financial institutions[153]. Operational Efficiency and Cost Management - The company has implemented a management restructuring and adopted an Amiba business management model, resulting in significant operational cost reductions[11]. - Human resources costs averaged approximately RMB 16.88 million per month from January to September 2023, decreasing to approximately RMB 12 million per month from October to December, a reduction of 29% year-on-year[11]. - The company aims to enhance operational efficiency through continuous cost reduction and efficiency improvement strategies[14]. - Administrative expenses were approximately RMB 55,597,000, a decrease of about RMB 44,009,000, primarily due to reduced share-based payment expenses and optimized management team costs[158]. Strategic Initiatives and Future Outlook - The company plans to leverage its advantages in big data and AI technology to explore new business models and enhance data asset applications in various industries[6]. - The company aims to strengthen its core competitive advantages through deep collaboration with ecosystem partners and enhance its data technology capabilities[6]. - The company plans to expand into overseas markets, particularly in Southeast Asia, to seek new growth opportunities[59]. - The outlook for 2024 indicates strong demand for digital transformation and innovation in the context of national policies supporting technology and data asset management[52]. Market Position and Recognition - The group has been recognized as a "Little Giant" enterprise with national-level specialized qualifications and ranked first in the banking industry's smart marketing solutions market by IDC[13]. - The company holds the number one market share in the "Intelligent Marketing Solutions Market" according to IDC's report on the Chinese banking IT solutions market[27]. - The company has achieved CMMI Level 5 certification, indicating its software development processes meet the highest global standards[34]. Research and Development - The company continues to enhance its core products, including intelligent marketing and big data applications, to meet customer needs and improve user experience[34]. - The company will continue to invest in R&D for data analysis and intelligent marketing solutions to enhance its competitive edge[60]. Financial Position and Assets - The total equity increased to RMB 117.307 million in 2023 from RMB 103.513 million in 2022[73]. - The company's total assets increased to RMB 444,148,000 in 2023 from RMB 410,883,000 in 2022, representing a growth of approximately 8.1%[74]. - Current assets rose significantly to RMB 302,629,000 in 2023, compared to RMB 236,420,000 in 2022, marking an increase of about 27.9%[74]. - The total liabilities increased to RMB 326,841,000 in 2023 from RMB 307,370,000 in 2022, reflecting a rise of approximately 6.4%[80]. Credit and Receivables Management - The company has identified a credit risk provision of RMB 32,095,000 for contract assets, compared to RMB 18,932,000 in 2022, reflecting an increase of approximately 69.5%[89]. - The expected credit loss provision for trade receivables and notes receivable increased to RMB 62,311 thousand as of December 31, 2023, compared to RMB 47,660 thousand in 2022, reflecting a rise of 30.7%[99]. - The total trade receivables and notes receivable as of December 31, 2023, amounted to RMB 166,596 thousand, an increase from RMB 129,982 thousand in 2022, representing a growth of approximately 28.1%[98]. Corporate Governance and Compliance - The company has adopted the corporate governance code as a basis for its governance practices and has complied with the relevant rules during the reporting period[191]. - The audit committee, consisting of independent non-executive directors, has reviewed the group's annual performance and audited consolidated financial statements[200]. - The audit committee confirmed that the consolidated financial statements fairly present the group's financial position and performance during the reporting period[200].

Financial Performance - The company's revenue for the six months ended June 30, 2023, was approximately RMB 121.13 million, a decrease of about 29.7% or RMB 51.11 million compared to the same period in 2022[75]. - Gross profit for the same period was approximately RMB 25.30 million, down about 41.7% due to reduced market orders and intensified competition[75]. - The net loss for the period was approximately RMB 63.18 million, an increase of about 68.5% compared to the previous year, primarily due to tightened IT budgets and increased competition[75]. - Basic and diluted loss per share for the period was approximately RMB 12.40, compared to RMB 9.12 and RMB 9.14 for the same period in 2022[76]. - Total revenue for the period was approximately RMB 121,126,000, a decrease of about 29.7% or RMB 51,112,000 compared to the first half of 2022[153]. - Revenue from data solution services was approximately RMB 88,885,000, accounting for about 73.3% of total revenue, down approximately 32.2% or RMB 42,251,000 from the previous year[153]. - The company's gross profit margin declined due to reduced market orders and increased competition, leading to a gross profit decrease of approximately RMB 18,130,000 compared to the first half of 2022[154][158]. Cash Flow and Financing - Cash outflow from operating activities was approximately RMB 51,588,000, a decrease of about RMB 27,144,000 compared to the first half of 2022[159]. - Cash inflow from financing activities was approximately RMB 106,448,000, slightly down from RMB 110,410,000 in the previous year[160]. - The company has entered into a loan agreement with an independent third party for a principal amount of RMB 20,000,000 at an annual interest rate of 6%, to be repaid by the end of September 2023[30]. - The company is exploring multiple financing channels to optimize its shareholder structure and ensure a smooth cash flow[134]. - As of June 30, 2023, the company's debt-to-equity ratio was approximately 82.7%, down from 143.6% as of December 31, 2022, primarily due to a reduction in bank and other borrowings by approximately RMB 13,342,000 and an increase in total equity by approximately RMB 60,147,000[183]. Share Capital and Equity - The company issued 193,800,000 new shares on January 15, 2023, raising approximately RMB 30,384,000, and an additional 143,000,000 shares on June 29, 2023, raising approximately RMB 100,779,000[12]. - The company’s issued and fully paid ordinary shares increased to 660,868,036 as of June 30, 2023, from 467,068,036 as of January 1, 2023, marking an increase of approximately 41.4%[11]. - The company authorized a total of 38,143,167 share options under its share option and incentive plans as of June 30, 2023[179]. - The potential number of shares to be issued under the share option plan for the six months ended June 30, 2023, was 0.1% of the weighted average number of shares issued during that period[180]. - The company aims to retain existing employees and attract new talent through its share option and incentive plans, which were adopted at the annual general meeting on June 8, 2020[178]. Assets and Liabilities - As of June 30, 2023, trade receivables amounted to RMB 50,135,000, an increase from RMB 36,323,000 as of December 31, 2022, representing a growth of approximately 38.1%[3]. - Trade payables decreased to RMB 38,722,000 as of June 30, 2023, from RMB 74,320,000 as of December 31, 2022, reflecting a reduction of approximately 47.9%[14]. - The company’s total liabilities related to accrued expenses and other payables decreased to RMB 39,480,000 as of June 30, 2023, from RMB 70,360,000 as of December 31, 2022, a decline of approximately 43.9%[15]. - The company’s other receivables rose to RMB 4,518,000 as of June 30, 2023, compared to RMB 1,728,000 as of December 31, 2022, representing an increase of approximately 161.5%[9]. - The company had short-term bank borrowings of approximately RMB 59,214,000 and other short-term borrowings of RMB 25,297,000 as of June 30, 2023[144]. Research and Development - Research and development expenses increased by approximately 4.4% to RMB 22,934,000, representing about 18.9% of total revenue, compared to 12.8% in the previous year[156]. - The company aims to leverage AI big data technology to expand its product offerings and solutions, aiming to capture opportunities in domestic substitution and digital transformation[118]. - The company is focused on expanding its market presence and enhancing collaboration with clients, leading to steady business growth in the first half of 2023[42]. - The company aims to strengthen its core competitiveness in AI big data product development, increasing investment in R&D and enhancing the application of AI large model technology[45]. Market Position and Strategy - The company is positioned as the "first financial AI stock in the Hong Kong market," focusing on providing domestic alternatives in big data, AI, and digital marketing solutions[84]. - The company has established a deep collaboration with Huawei to launch an intelligent marketing label platform solution, enhancing its capabilities in the financial technology sector[49]. - The company has become one of the first ecosystem partners of Baidu's "Wenxin Yiyan," integrating advanced AI dialogue technology into its financial technology applications[49]. - The company anticipates significant market opportunities in the "Xin Chuang" (information technology application innovation) sector, with projections indicating the market could exceed RMB 2 trillion by 2025[84]. - The company is adapting its business strategy in response to global economic trends and competitive pressures, including asset impairments totaling approximately RMB 17.80 million[75]. Employee and Talent Management - The company had a total of 688 employees in mainland China and Hong Kong as of June 30, 2023, providing competitive compensation and training programs[176]. - The company aims to optimize its talent structure by attracting high-end professionals and enhancing the training of technical personnel[134]. - The company has a strong talent pool and solid customer base, which has fostered continuous trust and business cooperation from clients[89]. - The company has not experienced any significant labor disputes or operational disruptions during the reporting period, indicating stable employee relations[195]. Innovation and Technology - The company has accumulated 35 national invention patents and 145 software copyright certificates as of June 30, 2023, indicating strong innovation capabilities[103]. - The company has established a comprehensive technology and service system from data platform to data operation, enhancing its solution service capabilities[92]. - The company focuses on AI big data and digital transformation, leveraging its technical advantages in customer analysis and smart marketing[91]. - The company has launched high-quality products and solutions to support the development of the digital economy and the Xinchuang industry[89]. - The company has partnered with major cloud service providers like Huawei Cloud and Alibaba Cloud to provide digital transformation solutions across various industries[100].

Performance Summary [Performance Summary](index=1&type=section&id=%E6%A5%AD%E7%B8%BE%E6%A6%82%E8%A6%81) In the first half of 2023, the company faced performance challenges, with total revenue decreasing by 29.7% year-on-year and net loss widening by 68.5%, primarily due to tightened IT budgets from financial institutions, increased market competition, and significant asset impairment provisions Key Performance Indicators for H1 2023 | Indicator | H1 2023 | H1 2022 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue (RMB million) | Approx. 121.0 | Approx. 172.0 | -29.7% | | Gross Profit (RMB million) | Approx. 25.3 | Approx. 43.43 | -41.7% | | Net Loss (RMB million) | Approx. 63.18 | Approx. 37.48 | +68.5% | | Basic Loss Per Share (RMB cents) | 12.40 | 9.12 | - | | Diluted Loss Per Share (RMB cents) | 12.40 | 9.14 | - | - The performance decline was primarily due to: (1) tightened IT and marketing budgets from financial institutions and increased market competition leading to lower gross profit; (2) asset impairment of approximately **RMB 17.8 million** on property, equipment, intangible assets, and right-of-use assets due to business strategy adjustments; and (3) impairment provisions of approximately **RMB 9.92 million** for financial and contract assets[13](index=13&type=chunk) Financial Statements [Interim Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) During the reporting period, the company recorded total revenue of **RMB 121.13 million**, a 29.7% year-on-year decrease, with operating loss expanding to **RMB 60.74 million** and net loss for the period significantly increasing to **RMB 63.18 million** Consolidated Statement of Comprehensive Income for H1 2023 (RMB in thousands) | Item | H1 2023 (Unaudited) | H1 2022 (Unaudited) | | :--- | :--- | :--- | | Revenue | 121,126 | 172,238 | | Gross Profit | 25,302 | 43,432 | | Operating Loss | (60,742) | (32,223) | | Loss Before Income Tax | (64,628) | (37,555) | | Loss for the Period | (63,176) | (37,484) | | Loss Attributable to Owners of the Company | (62,141) | (36,765) | [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2023, total assets decreased to **RMB 387.15 million**, total liabilities reduced to **RMB 223.49 million**, and total equity increased to **RMB 163.66 million**, with net current assets improving from negative to positive Key Items from Statement of Financial Position (RMB in thousands) | Item | June 30, 2023 (Unaudited) | December 31, 2022 (Audited) | | :--- | :--- | :--- | | **Assets** | | | | Non-current Assets | 140,315 | 174,463 | | Current Assets | 246,831 | 236,420 | | **Total Assets** | **387,146** | **410,883** | | **Liabilities and Equity** | | | | Non-current Liabilities | 14,214 | 7,706 | | Current Liabilities | 209,272 | 299,664 | | **Total Liabilities** | **223,486** | **307,370** | | **Total Equity** | **163,660** | **103,513** | | Net Current Assets | 37,559 | (63,244) | [Notes to the Financial Statements](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) The notes detail accounting policies, account breakdowns, and changes, including revenue by business line, significant asset impairment, increased expected credit loss provisions for trade and contract assets, and the composition and collateral of bank borrowings [Note 4: Revenue and Segment Information](index=7&type=section&id=4%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The company operates as a single segment, with total revenue of **RMB 121.13 million** in H1 2023, entirely from mainland China, where data solutions, the primary revenue source, decreased by 32.2% Revenue by Business Segment (RMB in thousands) | Business Segment | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Data Solutions | 88,885 | 131,136 | | Sales of Software, Hardware and Related Services | 21,771 | 24,589 | | IT Maintenance and Support Services | 10,470 | 16,513 | | **Total** | **121,126** | **172,238** | [Note 9: Property, Equipment, Intangible Assets and Right-of-Use Assets](index=11&type=section&id=9%20%E7%89%A9%E6%A5%AD%E5%8F%8A%E8%A8%AD%E5%82%99%E3%80%81%E7%84%A1%E5%BD%A2%E8%B3%87%E7%94%A2%E5%8F%8A%E4%BD%BF%E7%94%A8%E6%AC%8A%E8%B3%87%E7%94%A2) Due to deteriorating performance of certain cash-generating units, the company recognized a total impairment loss of **RMB 17.8 million** in H1 2023, including **RMB 12 million** for intangible assets, **RMB 3.1 million** for property and equipment, and **RMB 2.7 million** for right-of-use assets Asset Impairment Losses for H1 2023 (RMB in thousands) | Asset Category | Impairment Loss | | :--- | :--- | | Property and Equipment | 3,100 | | Intangible Assets | 12,000 | | Right-of-Use Assets | 2,700 | | **Total** | **17,800** | [Note 10: Trade Receivables](index=12&type=section&id=10%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of June 30, 2023, net trade receivables decreased to **RMB 67.54 million** from **RMB 82.32 million** at the beginning of the period, while the allowance for expected credit losses increased to **RMB 51.43 million**, indicating higher collection risk Trade Receivables and Provisions (RMB in thousands) | Item | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Gross Trade Receivables | 118,970 | 129,982 | | Less: Provisions | (51,429) | (47,660) | | **Net Carrying Amount** | **67,541** | **82,322** | [Note 13: Bank and Other Borrowings](index=14&type=section&id=13%20%E9%8A%80%E8%A1%8C%E5%8F%8A%E5%85%B6%E4%BB%96%E5%80%9F%E8%B2%B8) As of June 30, 2023, total bank and other borrowings increased to **RMB 94.51 million**, with **RMB 84.51 million** being current, primarily secured by company properties, trade receivables, pledged deposits, and director guarantees Composition of Bank and Other Borrowings (RMB in thousands) | Category | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Non-current | 10,000 | 2,461 | | Current | 84,511 | 79,130 | | **Total** | **94,511** | **81,591** | - Bank financing is supported by various asset pledges and personal guarantees, including properties (approx. **RMB 9.76 million**), trade receivables from specific customers (approx. **RMB 50.14 million**), pledged bank deposits (approx. **RMB 1.01 million**), and personal guarantees from directors and related parties[68](index=68&type=chunk)[91](index=91&type=chunk) Management Discussion and Analysis [Industry Background Analysis](index=18&type=section&id=%E4%B8%80%E3%80%81%20%E8%A1%8C%E6%A5%AD%E8%83%8C%E6%99%AF%E5%88%86%E6%9E%90) In H1 2023, supportive government policies for data, AI, and Xinchuang (IT Application Innovation) development, particularly in finance and government sectors, created a favorable macro environment and significant opportunities for the company - The Chinese government issued the 'Overall Layout Plan for Building a Digital China,' promoting deep integration of digital technology with the real economy and establishing the National Data Bureau to coordinate data resource development and utilization, providing top-level design support for industry growth[130](index=130&type=chunk) - The Xinchuang (Information Technology Application Innovation) industry received favorable policies, with the State-owned Assets Supervision and Administration Commission requiring **100%** Xinchuang replacement by state-owned enterprises by **2027**, significantly boosting market potential[131](index=131&type=chunk) - Cities like Beijing, Shanghai, and Shenzhen introduced policies to accelerate AI scenario development and 'AI+Industries' applications, creating market opportunities for the company's AI solutions in sectors such as finance[75](index=75&type=chunk) [H1 2023 Performance Review](index=20&type=section&id=%E4%BA%8C%E3%80%81%20%E4%BA%8C%E9%9B%B6%E4%BA%8C%E4%B8%89%E5%B9%B4%E4%B8%8A%E5%8D%8A%E5%B9%B4%E6%A5%AD%E7%B8%BE%E5%9B%9E%E9%A1%A7) Despite a challenging market, the company expanded its client base, maintained **100%** client retention, enhanced R&D with **35** patents and **145** software copyrights, and strengthened its Xinchuang competitiveness through strategic partnerships with industry leaders - Market Expansion: Added a new state-owned large bank client, secured a traffic operation model project with a national joint-stock bank, and maintained a **100%** renewal rate with key clients[134](index=134&type=chunk)[135](index=135&type=chunk) - Independent Innovation: Accumulated **35** national invention patents and **145** computer software copyrights, with a subsidiary recognized as a national 'Little Giant' enterprise specializing in niche sectors[104](index=104&type=chunk)[105](index=105&type=chunk) - Ecosystem Collaboration: Jointly launched intelligent marketing solutions with Huawei, became one of the first ecosystem partners for Baidu's 'Wenxin Yiyan,' and collaborated with Kylinsoft and GBase to develop financial Xinchuang solutions[138](index=138&type=chunk)[139](index=139&type=chunk)[108](index=108&type=chunk) [Future Outlook](index=24&type=section&id=%E4%B8%89%E3%80%81%20%E6%9C%AA%E4%BE%86%E5%B1%95%E6%9C%9B) The company plans to capitalize on increased bank IT spending and Xinchuang localization by focusing on AI big data product R&D, expanding solution offerings, securing multi-channel financing, and deepening ecosystem partnerships with tech giants like Huawei and Alibaba - Product R&D: Focus on AI big data products, increase R&D investment, apply AI large model technology, and build technological barriers[112](index=112&type=chunk) - Market Expansion: Seize opportunities from Xinchuang localization and digital transformation, provide integrated software, hardware, and service solutions, and achieve scale expansion[144](index=144&type=chunk) - Financing Development: Plan to optimize shareholder structure and secure funding through multi-channel financing, including external funding and strategic investors[115](index=115&type=chunk) - Ecosystem Collaboration: Continuously strengthen cooperation with tech giants like Huawei and Alibaba to jointly build a diversified ecosystem[116](index=116&type=chunk) [Financial Review](index=26&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section analyzes H1 2023 financial performance, detailing revenue and gross profit declines, changes in operating expenses, the impact of asset impairments on net loss, cash flow stability through financing, and a significant reduction in the gearing ratio [Revenue Analysis](index=26&type=section&id=1.%20%E6%94%B6%E5%85%A5) Revenue for the period was **RMB 121.13 million**, a 29.7% year-on-year decrease, with all business segments declining, notably the core data solutions business by 32.2% due to tightened IT and marketing budgets from financial institutions Revenue by Business Segment and Change (RMB in thousands) | Business Segment | H1 2023 | H1 2022 | YoY Change | | :--- | :--- | :--- | :--- | | Data Solutions | 88,885 | 131,136 | -32.2% | | Sales of Software, Hardware and Related Services | 21,771 | 24,589 | -11.5% | | IT Maintenance and Support Services | 10,470 | 16,513 | -36.6% | | **Total** | **121,126** | **172,238** | **-29.7%** | [Gross Profit and Gross Margin Analysis](index=27&type=section&id=2.%20%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) Gross profit decreased by 41.7% to **RMB 25.3 million**, with gross margin falling from **25.2%** to **20.9%**, primarily due to fewer market orders and lower margins on newly acquired projects amidst increased competition - Gross profit was approximately **RMB 25.3 million**, a **41.7%** year-on-year decrease[149](index=149&type=chunk) - Gross margin was **20.9%**, compared to **25.2%** in the same period last year[149](index=149&type=chunk) [Loss for the Period Analysis](index=28&type=section&id=7.%20%E6%9C%9F%E5%85%A7%E8%99%A7%E6%90%8D) Net loss for the period increased by 68.5% to approximately **RMB 63.18 million**, mainly driven by a **RMB 18.13 million** decline in gross profit, **RMB 17.8 million** in asset impairment, and **RMB 9.92 million** in financial and contract asset provisions - The increase in loss was primarily due to: (1) a decrease in gross profit of approximately **RMB 18.13 million**; (2) impairment of property, equipment, intangible assets, and right-of-use assets totaling approximately **RMB 17.8 million**; and (3) impairment provisions for financial and contract assets of approximately **RMB 9.92 million**[153](index=153&type=chunk) [Liquidity and Financial Resources](index=29&type=section&id=10.%20%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E6%94%BF%E4%BE%86%E6%BA%90) Net cash outflow from operating activities decreased to **RMB 51.59 million**, while net cash outflow from investing activities significantly reduced, and net cash inflow from financing activities of **RMB 106.45 million**, mainly from share issuance, effectively bolstered the company's liquidity Cash Flow Statement Summary (RMB in thousands) | Item | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Net Cash from Operating Activities | (51,588) | (78,732) | | Net Cash from Investing Activities | (698) | (24,155) | | Net Cash from Financing Activities | 106,448 | 110,410 | [Gearing Ratio](index=30&type=section&id=E.%20%E8%B3%87%E7%94%A2%E8%B2%A0%E5%80%B5%E7%8E%87) The gearing ratio (total borrowings/total equity) significantly decreased from **143.6%** at the end of 2022 to **82.7%** as of June 30, 2023, primarily due to an increase in total equity and a reduction in certain liabilities during the period - As of June 30, 2023, the gearing ratio was approximately **82.7%**, a significant decrease from **143.6%** as of December 31, 2022[186](index=186&type=chunk) Other Information [Remuneration Policy and Employee Benefits](index=33&type=section&id=%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96%E5%8F%8A%E5%83%B1%E5%93%A1%E7%A6%8F%E5%88%A9) As of June 30, 2023, the Group had **688** employees and offered competitive remuneration and discretionary bonuses based on performance, maintaining stable labor relations during the reporting period - As of June 30, 2023, the Group had **688** employees in mainland China and Hong Kong[4](index=4&type=chunk) [Use of Net Proceeds from Share Offer](index=34&type=section&id=%E8%82%A1%E4%BB%BD%E7%99%BC%E5%94%AE%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%8D%E4%B9%8B%E7%94%A8%E9%80%94) The company's 2019 IPO generated approximately **HKD 104 million** in net proceeds, mostly utilized as planned, with **HKD 3.5 million** remaining for AI lab and office facilities, extended for use until June 30, 2024 Use of Net Proceeds (HKD in millions) | Purpose | Allocated Amount | Amount Utilized | Unutilized Amount | | :--- | :--- | :--- | :--- | | Enhance Data Solutions Portfolio | 20.8 | 20.8 | – | | Enhance Sales and Marketing | 20.8 | 20.8 | – | | Develop Financial AI Lab, etc. | 36.4 | 32.9 | 3.5 | | Potential Strategic Acquisitions | 6.6 | 6.6 | – | | Working Capital and Others | 19.4 | 19.4 | – | | **Total** | **104.0** | **100.5** | **3.5** | [Interim Dividend](index=35&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board of Directors does not recommend an interim dividend for the six months ended June 30, 2023, consistent with the prior year - The Board does not recommend an interim dividend for the reporting period (H1 2022: nil)[5](index=5&type=chunk)

Financial Performance - The company's revenue for the reporting period was approximately RMB 377,126,000, a decrease of about 5.1% or approximately RMB 20,246,000 compared to 2021[7]. - The gross profit for the reporting period was approximately RMB 89,339,000, a decrease of about 30.9% compared to the previous year[8]. - The company reported a net loss attributable to owners of approximately RMB 128,192,000 for the reporting period, compared to a loss of approximately RMB 76,238,000 in 2021[13]. - The gross profit margin for the reporting period was approximately 23.7%, down about 8.8% from 32.5% in the previous year[117]. - The company's basic and diluted loss per share for the reporting period was RMB 0.309, compared to RMB 0.190 in the previous year[125]. - The company's financial and contract asset impairment provisions amounted to approximately RMB 24,397,000[119]. - The company incurred share-based payment expenses of approximately RMB 20,536,000 for stock options and reward shares, compared to RMB 5,772,000 in the previous year[118]. Revenue Breakdown - The decline in revenue was primarily due to a strategic optimization of the business structure, leading to a 16.0% decrease in integrated service revenue and a 32.5% decrease in IT maintenance and support service revenue[7]. - The data solution business experienced a growth of approximately 3.8% or about RMB 9,848,000 compared to 2021, despite the ongoing impact of the COVID-19 pandemic[7]. - Revenue from the core data business grew from RMB 166 million in 2019 to RMB 268 million in 2022, representing a compound annual growth rate of 35.9%[133]. - In 2022, the company's total revenue was approximately RMB 377 million, with the core data solutions business contributing about RMB 268 million, a year-on-year increase of 3.8%[139]. - The proportion of revenue from the core data solutions business increased from 64.9% to 71.0% of total revenue[139]. Strategic Initiatives - The company plans to enhance its leadership position in the data intelligence and marketing technology sectors in China through various proactive measures[6]. - The company will focus on developing a smart operations division to explore new customer collaboration models and drive business growth[4]. - The company aims to leverage ecosystem partnerships to expand its influence and customer coverage in the industry[2]. - The company is committed to creating more benchmark cases in the industry and applying successful experiences across various fields and institutions[2]. - The company plans to enhance its research in natural language processing and deep learning through a newly established post-doctoral innovation practice base[127]. - The company is focusing on enhancing its product innovation capabilities and optimizing its product portfolio to support clients' digital transformation[162]. - The company is entering the regulatory technology field with the launch of the "Lingju Panoramic Regulatory Compliance Platform," which has already been implemented in several banks[163]. Challenges and Risks - The company anticipates continued challenges due to the COVID-19 pandemic, which has extended project completion cycles and increased operational costs by approximately RMB 19,611,000[12]. - The company’s financial condition and operating performance may be affected by risks and uncertainties related to its business[30]. - Failure to secure new contracts from existing or new customers could adversely impact the company's operating and financial performance[31]. - The company faced potential quality issues with its solutions and products, which could significantly impact its reputation and customer relationships, negatively affecting revenue and profitability[50]. Capital and Financing - The company issued a total of 30,931,598 shares to 37 general authorized subscribers at a net subscription price of approximately HKD 1.039 per share[35]. - The company believes the subscription will align the interests of subscribers with shareholders and enhance long-term business development[35]. - The company aims to expand its capital base and shareholder base through the subscription[35]. - The company secured a RMB 100 million convertible loan from Financial Street Capital for technology development and market expansion[143]. - The company received an investment of RMB 100 million from Beijing Financial Street Capital Operation Group, aimed at technology R&D, market expansion, and acquiring quality financial big data technology companies[198]. - The company is actively seeking diversified financing channels to strengthen support for future development[198]. Market Position and Recognition - The company was recognized as the top provider in the smart marketing solutions market for the banking sector, with a market share of 32.28%[122]. - The company was recognized as one of the "Top 50 Digital Transformation Pioneers in China's Financial Industry" by CCID Consulting in November 2022[145]. - The company ranked first in the "Intelligent Marketing Solutions" market in China's banking industry, with a market share exceeding that of the next three competitors combined[157]. - The company has established partnerships with over 80% of leading banks and accumulated hundreds of case studies in the financial sector[150]. Operational Efficiency - The company reduced sales expenses by 31.2%, approximately RMB 11.27 million, through optimization of the sales and pre-sales teams[141]. - The company has implemented effective management policies to monitor foreign exchange risks due to its business transactions being primarily denominated in the functional currencies of its entities[84]. - The management closely monitors the liquidity position to ensure that the liquidity structure of its assets, liabilities, and other commitments meets its funding needs[95]. - The company has established a joint data modeling and operation cooperation model with a joint-stock bank to enhance customer operations and promote inclusive financial services[159]. Human Resources - The company emphasizes the importance of talent, implementing a stock incentive plan to attract and retain key personnel, even during challenging times[192]. - As of the reporting period, the proportion of technical personnel in the company reached 88.1%, with data-related personnel accounting for 72.7%[192].

Financial Performance - The company reported a loss of approximately RMB 124,022,000 for the year ended December 31, 2022, compared to a loss of RMB 79,472,000 for the previous year[8]. - The company's revenue for the reporting period was approximately RMB 377,126,000, a decrease of about 5.1% compared to 2021, primarily due to a 16.0% decline in integrated service sales and a 32.5% decrease in IT maintenance and support services[28]. - Gross profit for the reporting period was approximately RMB 89,339,000, a decrease of about 30.9% year-on-year, attributed to increased operational costs and a decline in revenue[28]. - The total comprehensive loss for the year was RMB 122,998,000, compared to a loss of RMB 76,316,000 in the previous year[138]. - The net loss for the reporting period was approximately RMB 124,022,000, compared to a net loss of RMB 75,987,000 in the previous year, representing an increase in loss of 63.1%[163]. Assets and Liabilities - As of December 31, 2022, the company recorded a net current liability of approximately RMB 63,244,000, indicating significant uncertainty regarding its ability to continue as a going concern[8]. - Total liabilities amounted to RMB 307,370,000, with total equity and liabilities at RMB 410,883,000[32]. - The debt-to-asset ratio was approximately 143.6%, an increase from 67.8% in 2021, attributed to an increase in bank and other borrowings by approximately RMB 31,283,000 and financial borrowings by approximately RMB 41,981,000[131]. - The total assets decreased to RMB 410,883,000 from RMB 473,692,000, a reduction of 13.3%[166]. Revenue Breakdown - Revenue from data solutions was RMB 267,589,000, an increase from RMB 257,741,000 in the previous year, while revenue from integrated services decreased to RMB 77,914,000 from RMB 92,783,000[38]. - The proportion of revenue from the core data solution business increased from 64.9% to 71.0% of total revenue[58]. - Revenue from mainland China for the year was RMB 377,126,000, a decrease from RMB 392,412,000 in 2021[149]. Operational Costs - The company reported an increase in operational costs by approximately RMB 19,611,000 due to project completion delays caused by COVID-19 restrictions[77]. - Employee benefits expenses, including director remuneration, increased to RMB 267,880,000 from RMB 243,376,000 in the previous year[41]. - The main reasons for the loss included increased operational costs of approximately RMB 19,611,000 due to COVID-19 restrictions, and share-based payment expenses of approximately RMB 20,536,000, up from RMB 5,772,000 in the previous year[163]. Credit and Receivables - Trade receivables increased from RMB 35,344,000 at the beginning of the year to RMB 47,660,000 at year-end, with expected credit loss provisions rising from RMB 19,332,000 to RMB 12,316,000[22]. - The expected credit loss provision for trade receivables increased to RMB 22.54 million by the end of 2022, compared to RMB 10.46 million at the end of 2021[51]. - The weighted average expected loss rates for trade receivables decreased from 7% to 2% for current receivables from 2021 to 2022, indicating improved credit quality[80]. Investments and Financing - The company expects to raise up to approximately HKD 133,380,000 through the issuance of new shares at a subscription price of HKD 0.76 per share, pending shareholder approval[36]. - The net cash generated from financing activities was approximately RMB 65,273,000, mainly due to share issuance, convertible loans, and financing from banks and other financial institutions[127]. - The company received an investment of RMB 100 million from Beijing Financial Street Capital Operation Group to support technology R&D, market expansion, and acquisitions of quality financial big data technology companies[96]. Strategic Initiatives - The company has established a joint data modeling and operation cooperation model with a joint-stock bank to enhance customer operations and promote inclusive financial services[62]. - The company aims to strengthen its talent structure by attracting high-level professionals and optimizing its composite talent structure to drive development[72]. - The company plans to continue focusing on data intelligence and marketing technology, leveraging its end-to-end data capabilities and rich experience serving top banks[69]. Research and Development - Research and development expenses were approximately RMB 39,580,000, a decrease of about 35.6% or approximately RMB 21,882,000 compared to 2021, accounting for about 10.5% of the revenue[120]. - The company is committed to enhancing its R&D capabilities to deliver high-quality products and solutions[195]. Market Position - The company ranked first in the "Smart Marketing Solutions" market in the Chinese banking sector with a market share exceeding the combined total of the next three competitors[90]. - The company has engaged in business with 15 out of the 18 major banks in China, which invested approximately RMB 170.45 billion in fintech in 2021[63]. - The company is actively engaged in smart marketing projects with multiple banks, enhancing its market position in the banking sector[198].