Financial Proceeds Utilization - The net proceeds from the rights issue amount to approximately HKD 330.0 million, with about HKD 39.6 million remaining unutilized as of December 31, 2023[1]. - The company plans to utilize approximately HKD 39.6 million of the unutilized proceeds for acquiring equity in pharmaceutical companies engaged in the pharmaceutical business overseas and/or domestically in China, as well as for general working capital[2]. - The company has allocated approximately HKD 17.3 million of the unutilized proceeds for the acquisition of 16% of the issued share capital of China Nüwa Pharmaceutical Group Co., Ltd., which primarily operates in the domestic pharmaceutical business in China[10]. - The remaining unutilized proceeds of approximately HKD 22.3 million are planned to be used as general working capital for the group[10]. - The company intends to expand the proposed use of unutilized proceeds to cover general operations and domestic pharmaceutical business in China, excluding overseas pharmaceutical operations[9]. Business Strategy and Market Focus - The company aims to enhance its product portfolio and distribution channels to better capture opportunities in the domestic Chinese market[9]. - The company has adopted a cautious approach in seeking suitable business or investment opportunities due to economic instability and the impact of the COVID-19 pandemic[9]. Corporate Governance - The board of directors includes key members such as Chairwoman Wang Qiuxin and other executive directors[7]. - The company emphasizes that the supplementary information provided does not affect the contents of the annual report, which remains unchanged[6]. - The announcement clarifies that the Hong Kong Stock Exchange and the Hong Kong Exchanges and Clearing Limited bear no responsibility for the accuracy or completeness of the announcement[8].

Financial Performance - For the fiscal year ending December 31, 2023, the group recorded revenue of approximately HKD 50.2 million, a decrease of about 44.1% compared to HKD 89.8 million in 2022[8] - The gross profit for the fiscal year was approximately HKD 12.9 million, a slight decrease of about 2.3% from HKD 13.2 million in 2022[8] - The net loss attributable to the company's owners was approximately HKD 22.2 million, significantly reduced by about 71.5% from a loss of HKD 77.9 million in 2022[8] - The total revenue for the year was approximately HKD 50.2 million, a decrease of about 44.1% compared to approximately HKD 89.8 million for the year ended December 31, 2022[36] - The cost of sales for the year was approximately HKD 37.2 million, a decrease of about 51.4% from approximately HKD 76.5 million for the year ended December 31, 2022[37] - Gross profit decreased by approximately HKD 0.3 million or about 2.3% to approximately HKD 12.9 million, with a gross margin of approximately 25.8%, an increase of 11.0 percentage points compared to the previous year[38] - Other net losses for the year were approximately HKD 1.3 million, a significant reduction from a loss of approximately HKD 6.7 million in the previous year[39] - Selling and distribution expenses were approximately HKD 14.1 million, a decrease of about 26.6% from approximately HKD 19.2 million for the year ended December 31, 2022[40] - Administrative expenses were approximately HKD 14.6 million, a decrease of about 28.4% from approximately HKD 20.4 million for the year ended December 31, 2022[41] - Trade and other receivables impairment losses were approximately HKD 4.1 million, compared to HKD 4.6 million in the previous year[43] Market Challenges - The group faced challenges due to the implementation of stricter management policies for antibacterial drugs in various regions of mainland China, impacting the demand for its main product, the second-generation cephalosporin[10] - The average price reduction for the first batch of national volume-based procurement was about 52%, with the maximum reduction reaching approximately 96%[21] - The ninth batch of national volume-based procurement, completed in November 2023, involved 41 drug varieties with an average price reduction of about 58%[22] Strategic Initiatives - The group actively strengthened cooperation with suppliers and end customers, such as hospitals, to enhance sales and marketing capabilities[10] - The company plans to seek new product distribution rights to enhance its product portfolio and improve long-term sustainable development in 2024[23] - The company aims to enhance its local distribution network and sales and marketing capabilities to strengthen its competitive advantage in China[24] - The company intends to focus on its core business in pharmaceutical product distribution and marketing services while seeking potential acquisition opportunities for higher shareholder returns[25] - The company continues to diversify its product portfolio and expand its distribution network to mitigate risks associated with reliance on suppliers and government policies in the Chinese pharmaceutical industry[35] Environmental and Social Governance - The company acknowledges the importance of environmental policies and has implemented measures to ensure efficient resource utilization[27] - The group has established an Environmental, Social, and Governance (ESG) team responsible for collecting relevant data and reporting to the board on ESG-related matters[193] - The board reviews the group's ESG performance annually and identifies related risks[193] - Key stakeholders, including employees, suppliers, distributors, and customers, participated in discussions to assess significant ESG issues for the year[195] - The group emphasizes the importance of energy management, water usage, gas emissions, and waste management in its ESG strategy[198] Corporate Governance - The company has a governance structure with independent non-executive directors overseeing key committees, ensuring compliance and strategic oversight[86][87] - The board of directors consists of seven members, including four executive directors and three independent non-executive directors[147] - The company has complied with the corporate governance code, except for the deviation regarding the roles of the Chairman and CEO being held by the same individual[142] - The company has established a written terms of reference for both the Audit Committee and the Corporate Governance Committee, which are published on the company's website[173][175] Legal Matters - The company is involved in a legal proceeding initiated by the Securities and Futures Commission, which claims damages against former directors totaling HKD 26 million[78] - The company is involved in legal proceedings regarding the acquisition of a 50% stake in SciTech International, with details disclosed in announcements dated February 14, March 20, June 26, and July 16, 2015[79] - As of December 31, 2023, there are no significant ongoing lawsuits, arbitrations, or claims involving the company, aside from those disclosed[80] Shareholder Information - The company has not made any changes to its share capital during the year, maintaining stability in its equity structure[98] - As of December 31, 2023, the total number of issued shares was 1,671,846,657, with significant shareholdings reported by directors, including 26.51% held by Chu Xueping[106] - The top five customers accounted for approximately 77.4% of the total revenue, with the largest customer contributing about 32.2%[113] Future Outlook - The company aims for long-term, stable, and sustainable growth while considering environmental, social, and governance issues[145] - Future strategies include potential market expansion and the development of new products and technologies to meet evolving customer needs[79]

Financial Performance - For the fiscal year ending December 31, 2023, the group recorded revenue of approximately HKD 50.2 million, a decrease of about 44.1% compared to HKD 89.8 million in 2022[3] - The gross profit for the same period was approximately HKD 12.9 million, down 2.3% from HKD 13.2 million in 2022[3] - The net loss attributable to the owners of the company was approximately HKD 22.2 million, a significant reduction of about 71.5% from a loss of HKD 77.9 million in 2022[3] - Basic and diluted loss per share was HKD 1.33 for the year ending December 31, 2023, compared to HKD 4.66 in 2022[4] - The company reported a loss attributable to shareholders of HKD 22,170,000 for the year 2023, compared to a loss of HKD 77,947,000 in 2022, indicating a significant improvement[33] - The group recorded a net loss of approximately HKD 22.2 million for the year, a decrease of about 71.5% compared to approximately HKD 77.9 million for the year ended December 31, 2022[67] Revenue Breakdown - Revenue from pharmaceutical product distribution and trade was HKD 42,852,000, down from HKD 83,754,000, indicating a decrease of about 49%[13] - Revenue from marketing and promotional services increased to HKD 7,302,000 from HKD 6,017,000, reflecting a growth of approximately 21%[13] - For the year ended December 31, 2023, total revenue from external sales and segment revenue was HKD 50,154,000, with HKD 42,852,000 from pharmaceutical products distribution and trade, and HKD 7,302,000 from marketing and promotion services[18] - The revenue from the pharmaceutical product distribution and trading segment decreased by approximately 48.8% to HKD 42.9 million from HKD 83.8 million in 2022[53] - The marketing and promotion services segment generated revenue of approximately HKD 7.3 million, an increase of about 21.7% compared to HKD 6.0 million in 2022[54] Assets and Liabilities - As of December 31, 2023, the group's asset-to-liability ratio was zero, unchanged from 2022[3] - Non-current assets decreased to HKD 113.4 million in 2023 from HKD 136.0 million in 2022[5] - Current assets decreased to HKD 378.2 million in 2023 from HKD 403.9 million in 2022[5] - Current liabilities decreased to HKD 5.6 million in 2023 from HKD 7.8 million in 2022[5] - The total equity attributable to the owners of the company was HKD 480.3 million in 2023, down from HKD 525.7 million in 2022[5] - The company’s total liabilities decreased to HKD 5,267,000 in 2023 from HKD 6,862,000 in 2022, indicating a reduction in financial obligations[37] Expenses - The company incurred total administrative expenses of HKD 14,629,000 and sales and distribution expenses of HKD 14,067,000 for the year ended December 31, 2023[18] - Selling and distribution expenses were approximately HKD 14.1 million, a decrease of about 26.6% from approximately HKD 19.2 million for the year ended December 31, 2022[60] - Administrative expenses were approximately HKD 14.6 million, down about 28.4% from approximately HKD 20.4 million for the year ended December 31, 2022[62] - Total employee costs decreased to HKD 8,063,000 in 2023 from HKD 18,360,000 in 2022, reflecting a reduction in overall expenses[30] Market Conditions and Future Outlook - The company anticipates ongoing pricing pressure on pharmaceuticals and potential market share losses, which may further reduce sales volume and average profit margins[40] - The group expects continued challenges in the market due to government reforms in the healthcare system, which may impact future performance[40] - The group plans to enhance its product portfolio and distribution channels to achieve sustainable development in 2024[47] - The group aims to focus on long-term growth by reallocating resources to core pharmaceutical distribution and marketing services in China[49] - The group will continue to seek potential acquisition opportunities to provide higher returns to shareholders[49] Corporate Governance and Management - The board of directors did not recommend the payment of a final dividend for the year ending December 31, 2023[3] - The board of directors is committed to maintaining good corporate governance standards, which are believed to provide a framework for business strategy and policy formulation[105] - The annual performance of the company has been reviewed by the Board of Directors' Audit Committee[112] - The executive directors include Ms. Wang Qiuqin, Mr. Huo Zhihong, Mr. Chu Xueping, and Ms. Zhou Wan[114] - The independent non-executive directors consist of Mr. Liang Zhijian, Ms. Li Qianming, and Mr. Shi Lixian[114] Investments and Acquisitions - The group aims to participate in the investment and construction of a medical industry park project in Shengzhou, Zhejiang Province, China[89] - The group will act as a passive investor in the target company and will not participate in its management or operational functions[90] - As of December 31, 2023, the group holds approximately 39% equity in the target company, with a fair value of approximately HKD 36.6 million, representing about 7.4% of the group's total assets[90] - The total amount of shareholder loans provided by the partners to the target company is now RMB 23.7 million, with contributions of approximately RMB 9.5 million (approximately HKD 11.0 million), RMB 9.2 million (approximately HKD 10.7 million), and RMB 5.0 million (approximately HKD 5.8 million) from Partner A, China New Sharp, and Partner B respectively[88] Miscellaneous - The company received government subsidies totaling approximately HKD 51,000 to support its development, which were recognized in the profit and loss statement[26] - The company reported bank interest income of HKD 2,968,000 for the year ended December 31, 2023, compared to HKD 2,655,000 in the previous year[26] - The deferred tax expense for the year ended December 31, 2023, was HKD 172,000, compared to HKD 2,339,000 in the previous year[27] - The group continues to monitor foreign exchange risks due to its operations in China, with no significant impact from currency fluctuations reported this year[80] - There have been no significant events affecting the group after December 31, 2023, up to the date of this announcement[110]

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之內容概不 負責，對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全 部或任何部分內容而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 New Ray Medicine International Holding Limited 新銳醫藥國際控股有限公司 （於百慕達註冊成立之有限公司） （股份代號：6108） 截 至 二 零 二 三 年 六 月 三 十 日 止 六 個 月 之 中 期 業 績 公 告 財務概要 截至二零二三年六月三十日止六個月： • 截至二零二三年六月三十日止六個月，本集團錄得收益約73,039,000港 元，較二零二二年同期的收益約59,293,000港元增加約23.2%。 • 截至二零二三年六月三十日止六個月，本公司擁有人應佔虧損淨額約 為13,357,000港元，較二零二二年同期的本公司擁有人應佔虧損淨額約 ...

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之內容概不 負責，對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全 部或任何部分內容而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 New Ray Medicine International Holding Limited 新銳醫藥國際控股有限公司 （於百慕達註冊成立之有限公司） （股份代號：6108） 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度 全 年 業 績 公 告 二零二二年財務摘要 • 截至二零二二年十二月三十一日止年度，本集團錄得收益約89.8百萬港元 （二零二一年：約335.4百萬港元），較二零二一年減少約73.2%。 • 截至二零二二年十二月三十一日止年度，本集團毛利約為7.6百萬港元（二 零二一年：約28.5百萬港元），較二零二一年減少約73.3%。 • 截至二零二二年十二月三十一日止年度，本公司擁有人應佔淨虧損約為 ...

Financial Performance - For the six months ended June 30, 2022, the group recorded revenue of approximately HKD 59,293,000, a decrease of about 72.4% compared to approximately HKD 214,491,000 for the same period in 2021[7] - The group reported a net loss attributable to owners of the company of approximately HKD 21,378,000 for the six months ended June 30, 2022, compared to a net profit of approximately HKD 1,133,000 for the same period in 2021[7] - The group recorded a total comprehensive loss of approximately HKD 34,916,000 for the six months ended June 30, 2022, compared to a total comprehensive income of approximately HKD 23,830,000 for the same period in 2021[8] - Basic and diluted loss per share was HKD 1.28 for the six months ended June 30, 2022, compared to earnings per share of HKD 0.07 for the same period in 2021[8] - The company reported a loss before tax of HKD 21,378,000 for the six months ended June 30, 2022, compared to a profit before tax of HKD 1,133,000 in the same period of 2021[35] - The gross profit margin for the pharmaceutical products segment was negative, with a segment loss of HKD 19,000 for the six months ended June 30, 2022, compared to a profit of HKD 15,690,000 in 2021[35] - The company reported a net loss of approximately HKD 21,378,000 for the period, compared to a profit of approximately HKD 1,133,000 in the same period last year[84] Assets and Liabilities - As of June 30, 2022, the group's total assets less current liabilities amounted to HKD 617,133,000, a decrease from HKD 642,553,000 as of December 31, 2021[10] - The group's asset-liability ratio was zero as of June 30, 2022, compared to approximately 1.8% as of December 31, 2021[6] - Non-current assets increased to HKD 183,410,000 as of June 30, 2022, from HKD 178,012,000 as of December 31, 2021[10] - The company reported a total equity of HKD 608,049,000 as of June 30, 2022, a slight increase from HKD 605,924,000 a year earlier[11] - The company’s retained earnings decreased by HKD 5,815,000 during the reporting period[11] Cash Flow - For the six months ended June 30, 2022, the company reported a net cash inflow from operating activities of HKD 17,373,000, compared to a net cash outflow of HKD 48,588,000 in the same period of 2021[15] - The company generated a net cash inflow from investing activities of HKD 3,954,000, a decrease from HKD 53,464,000 in the previous year[15] - The company’s cash and cash equivalents stood at HKD 151,891,000 as of June 30, 2022, slightly up from HKD 150,153,000 as of December 31, 2021[10] Dividends - The board of directors did not recommend the payment of any interim dividend for the six months ended June 30, 2022, consistent with the previous year[7] - The company did not declare any interim dividends for the period, consistent with the previous year[41] Investments and Acquisitions - The company acquired 50% equity in Saike International for RMB 95 million and 15% equity in Weijian International for RMB 47.25 million, completed in 2015 and 2017 respectively[25] - The company has no equity interest in Weijian International as of June 30, 2022, following the sale of its shares[26] - The company completed the sale of a 25% stake in Sai Ke International for RMB 44.0 million (approximately HKD 54.1 million) on August 15, 2022[88] - A cooperation agreement was signed to establish a target company in China with an initial registered capital of RMB 50 million (approximately HKD 58.8 million), with the company contributing RMB 19.5 million (approximately HKD 22.9 million)[89] Operational Focus - The company operates primarily in China, focusing on the distribution and trade of pharmaceutical products and providing marketing and promotional services[32] - The report indicates that the company’s segments include pharmaceutical product distribution and trade, and marketing and promotional services[33] - The company plans to enhance its product portfolio by seeking distribution rights for new products and improving its marketing and promotion strategies in the second half of 2022[72] - The company aims to expand its local distribution network and enhance sales and marketing capabilities to strengthen its competitive advantage in China[73] - The company intends to focus on its core business of pharmaceutical product distribution and trade, reallocating resources for future development and seeking potential acquisition opportunities[74] Market Conditions - The ongoing national volume-based procurement is expected to continue, putting downward pressure on drug prices and potentially affecting the profitability of pharmaceutical distribution companies, including the company[71] Employee and Administrative Costs - Employee costs, including director remuneration, amounted to approximately HKD 14,303,000 for the period, compared to approximately HKD 3,858,000 for the six months ended June 30, 2021[107] - The group had 26 employees as of June 30, 2022, down from 27 employees as of December 31, 2021[107] - Administrative expenses increased by approximately 14.8% to about HKD 11,707,000, mainly due to share-based payment expenses of approximately HKD 7.3 million[81] Legal and Compliance - The company is involved in a legal case initiated by the Securities and Futures Commission, which claims that two former directors are responsible for misconduct that harmed the company, with a potential liability of HKD 26 million[138] - An independent committee was established to investigate the acquisitions and ensure compliance with internal control systems, with ongoing investigations as of the report date[110] - The company has committed to implementing all improvement recommendations from the internal control review conducted by an external advisor[114] Share Capital and Options - The company granted options for a total of 143,200,000 shares at an exercise price of HKD 0.287 per share[129] - The estimated fair value of the options granted on June 14, 2022, is approximately HKD 10,393,000[129] - The company's issued and fully paid ordinary shares remained at 1,671,847,000 shares with a total value of HKD 83,592,000 as of June 30, 2022[50] Financial Reporting and Standards - The company has adopted new and revised Hong Kong Financial Reporting Standards effective from January 1, 2022, with no significant impact on its financial position or performance[31] - The audit committee is responsible for reviewing the company's financial statements and providing recommendations to the board, consisting of three independent non-executive directors[141] - The audit committee has reviewed the unaudited condensed consolidated financial statements for the period[142]

Financial Performance - For the year ended December 31, 2021, the group recorded revenue of approximately HKD 335.4 million, an increase of about 151.8% compared to HKD 133.2 million in 2020[6] - The gross profit for the same period was approximately HKD 28.5 million, representing a 161.5% increase from HKD 10.9 million in 2020[6] - The net loss attributable to the owners of the company was approximately HKD 2.8 million, a significant reduction of about 96.0% from a loss of HKD 69.7 million in 2020[6] - The group's revenue from pharmaceutical product distribution and trade increased by approximately 156.1% to HKD 329.6 million in 2021, compared to HKD 128.7 million in 2020[17] - The marketing and promotion services segment generated revenue of approximately HKD 5.8 million in 2021, up 28.9% from HKD 4.5 million in 2020[18] - The cost of sales for the year was approximately HKD 306.9 million, an increase of about 150.9% from approximately HKD 122.3 million for the year ended December 31, 2020[34] - Gross profit increased by approximately HKD 17.6 million or about 161.5% to approximately HKD 28.5 million, with a gross margin of approximately 8.5%, a slight increase of 0.3 percentage points from the previous year[35] - Other income for the year was approximately HKD 2.6 million, a decrease from approximately HKD 10.9 million in the previous year, primarily due to a reduction in foreign exchange gains[36] Revenue Drivers - The increase in revenue was primarily driven by higher sales volume of the second-generation cephalosporin product (1.0g) and increased demand for pharmaceutical products due to relaxed population movement restrictions in various cities in China[10] - The company participated in various academic promotional activities in China, contributing to the gradual increase in sales of its main product since resuming production and sales in September 2019[10] Loss Reduction Factors - The company reported a decrease in impairment losses on trade and other receivables during the year, contributing to the reduced net loss[10] - The company recorded no impairment losses on its equity interest in Saike International Medical Group during the year, contrasting with an impairment loss of approximately HKD 37.3 million in the previous year[10] - The reduction in net loss was primarily due to increased sales of the product (1.0g), leading to higher gross profit, a decrease in impairment losses on trade and other receivables, and no impairment losses recognized for the investment in Saike International during the year[42] Dividends and Shareholder Equity - The company did not recommend the payment of a final dividend for the year ended December 31, 2021, consistent with the previous year[6] - As of December 31, 2021, the group's shareholders' equity was approximately HKD 632.6 million, an increase from HKD 605.9 million in 2020[68] Market and Regulatory Environment - The average price reduction for drugs in the fourth batch of national volume-based procurement was about 52%, with the largest price drop reaching 96%[20] - The fifth batch of procurement involved 62 drug varieties, with an average price reduction of approximately 56%, and the largest drop being 98%[20] - The sixth batch of procurement included 42 insulin products, with an average price reduction of about 49%, and the largest drop being 74%[20] - The new procurement plan initiated by the Chinese government has led to price pressures on certain medical products, creating uncertainty for profitability in the medical device industry[51] Strategic Initiatives - The company plans to enhance its product portfolio by seeking distribution rights for new products to ensure sustainable growth[21] - The company aims to improve its local distribution network and sales capabilities to strengthen its competitive advantage in China[22] - The company will focus on reallocating resources to core business areas in pharmaceutical distribution and marketing services in China for long-term growth[23] - The company plans to diversify its product portfolio and expand its distribution network to mitigate risks associated with supplier and regulatory dependencies[33] Corporate Governance and Management - The company has a strong management team with over 16 years of experience in the pharmaceutical distribution industry, led by CEO Wang Qiukin[88] - The company has expanded its executive team, with new appointments including Chu Xueping, who has over 10 years of experience in the pharmaceutical industry[90] - The company has a commitment to corporate governance, with a dedicated committee chaired by the CEO[88] - The board consists of six members, including three executive directors and three independent non-executive directors, ensuring a balanced governance structure[166] Legal and Compliance Matters - The company is involved in a legal case where the Securities and Futures Commission claims that two former directors are responsible for misconduct, potentially leading to a payment of HKD 26 million plus interest[86] - The company has not been involved in any significant litigation, arbitration, or claims as of December 31, 2021, apart from the aforementioned case[87] - The company is currently facing an audit qualification due to insufficient evidence regarding related party transactions related to acquisitions, impacting the integrity of the consolidated financial statements for the year ended December 31, 2021[155][158] Risk Management - The company has a structured approach to risk management, with discussions on major risks and uncertainties included in the management discussion and analysis section[109] - The board is responsible for the internal control and risk management systems, which are designed to manage risks rather than eliminate them[197] - The internal control system includes identifying significant risks, assessing their likelihood, and determining risk management strategies[197] Shareholder Information - The company has a significant shareholder, Eagle Amber Holdings Limited, which owns approximately 25.52% of the company's issued shares[90] - As of December 31, 2021, major shareholders include Eagle Amber Holdings Limited with 426,672,000 shares, representing 25.52% of total issued shares[120] Training and Development - The company provides training materials to all directors regarding their duties and responsibilities under the latest legal developments[170] - The company has committed to gender equality and has provided fair recruitment, training, and promotion opportunities for all employees this year[185]

Financial Performance - For the six months ended June 30, 2021, the group recorded revenue of approximately HKD 214,491,000, an increase of approximately 208.8% compared to approximately HKD 69,470,000 for the same period in 2020[8] - The group turned a net loss attributable to owners of the company of approximately HKD 36,434,000 for the six months ended June 30, 2020, into a net profit of approximately HKD 1,133,000 for the six months ended June 30, 2021[8] - The group’s total comprehensive income for the six months ended June 30, 2021, was HKD 23,830,000, compared to a total comprehensive loss of HKD 61,064,000 for the same period in 2020[9] - The group’s basic and diluted earnings per share for the six months ended June 30, 2021, was HKD 0.07, compared to a loss of HKD 2.18 for the same period in 2020[9] - The company reported a pre-tax profit of HKD 1,133,000 for the first half of 2021, a turnaround from a pre-tax loss of HKD 36,633,000 in the same period of 2020[33] - Profit for the period was approximately HKD 1,133,000, a significant improvement from a loss of approximately HKD 36,434,000 in the same period last year[88] Assets and Liabilities - The group’s total assets less current liabilities amounted to HKD 640,656,000 as of June 30, 2021, compared to HKD 617,066,000 as of December 31, 2020[10] - The group’s current assets increased to HKD 397,695,000 as of June 30, 2021, from HKD 349,355,000 as of December 31, 2020[10] - The group’s non-current assets decreased to HKD 263,010,000 as of June 30, 2021, from HKD 300,765,000 as of December 31, 2020[10] - The group’s cash and cash equivalents increased to HKD 68,671,000 as of June 30, 2021, from HKD 65,755,000 as of December 31, 2020[10] - Trade receivables amounted to HKD 103,391,000 as of June 30, 2021, up from HKD 38,150,000 as of December 31, 2020, with a provision for credit losses of HKD 32,100,000[50] - The total value of prepaid and guarantee deposits to suppliers was approximately HKD 144,179,000 as of June 30, 2021, down from HKD 171,057,000 as of December 31, 2020[51] Dividends and Share Capital - The group did not recommend the payment of any interim dividend for the six months ended June 30, 2021, consistent with the previous year[8] - The issued and paid-up share capital remained at 1,671,847,000 shares with a value of HKD 83,592,000 as of June 30, 2021[54] - Major shareholders include Eagle Amber Holdings Limited, Zhang Jiang, and Dai Xiaosong, each holding 426,672,000 shares, representing 25.52% of total issued shares[134] Investments and Acquisitions - The company acquired 50% equity in Saike International for RMB 95 million and 15% equity in Weijian International for RMB 47.25 million, completed in 2015 and 2017 respectively[23] - The company completed the sale of 25% of its equity interest in Saiko International for a maximum consideration of RMB 44,000,000 (approximately HKD 51.8 million)[93] - The company agreed to sell approximately 7.87% of its equity interest in Weijian International for RMB 68,000,000 (approximately HKD 80.9 million)[97] Operational Highlights - The company is primarily engaged in the distribution and trading of pharmaceutical products in China, with a focus on marketing and promotional services[16] - The company plans to enhance its product portfolio and distribution channels, focusing on acquiring distribution rights for new products in the second half of 2021[75] - The ongoing national volume-based procurement is expected to continue, potentially leading to further price reductions for pharmaceuticals, which may impact the profitability of companies in the pharmaceutical distribution sector, including the company[74] Challenges and Risks - The company faces challenges due to national volume-based procurement policies, which are expected to continue and expand, leading to downward pressure on drug prices[112] - The company is currently unable to establish a clear timeline for resuming trading of its shares due to legal restrictions[122] - The company is actively monitoring foreign currency risks, with most transactions conducted in RMB, and does not currently require a foreign currency hedging policy[119] Corporate Governance - Liu Yang resigned as executive director and chairman on May 15, 2021, to focus on personal business[139] - Wang Qiukin was appointed as chairman and CEO following Liu Yang's resignation, which deviates from the corporate governance code regarding separation of roles[142] - The company has adopted its own corporate governance practices in accordance with the corporate governance code[141] Legal and Regulatory Matters - The Securities and Futures Commission (SFC) has filed a petition against the company and two former directors, alleging misconduct related to business operations from 2015 to 2018[147] - As of June 30, 2021, there are no significant ongoing litigations, arbitrations, or claims involving the company[149]

Financial Performance - For the year ended December 31, 2020, the group recorded revenue of approximately HKD 133.2 million, an increase of about 12.3% compared to HKD 118.6 million in 2019[7]. - The gross profit for the same period was approximately HKD 10.9 million, a decrease of about 26.8% from HKD 14.9 million in 2019[7]. - The net loss attributable to owners of the company was approximately HKD 69.7 million, an increase of about 58.0% from a loss of HKD 44.1 million in 2019[7]. - The overall revenue for the group reached HKD 133.2 million in 2020, compared to HKD 118.6 million in 2019, maintaining a gross margin of 5.2%[18]. - Sales cost for the year was approximately HKD 122.3 million, an increase of about 17.8% from approximately HKD 103.8 million for the year ended December 31, 2019[36]. - Gross profit decreased to approximately HKD 10.9 million, a decline of about 26.8% from approximately HKD 14.9 million for the year ended December 31, 2019, with a gross margin of about 8.2%, down 4.3 percentage points[37]. - Other income for the year was approximately HKD 10.9 million, a turnaround from a net loss of approximately HKD 1.4 million in 2019, mainly due to a net foreign exchange gain of approximately HKD 8.9 million[38]. - Selling and distribution expenses decreased to approximately HKD 10.5 million, a reduction of about 37.1% from approximately HKD 16.7 million for the year ended December 31, 2019[39]. - Administrative expenses were approximately HKD 17.4 million, down about 12.6% from approximately HKD 19.9 million for the year ended December 31, 2019[40]. - The company incurred a loss of approximately HKD 69.7 million for the year, an increase of about 58.0% compared to a loss of approximately HKD 44.1 million for the year ended December 31, 2019[44]. Dividend and Equity - The board did not recommend the payment of a final dividend for the year ended December 31, 2020[7]. - As of December 31, 2020, the group's total equity was approximately HKD 605.9 million, down from HKD 654.5 million in 2019[67]. - As of December 31, 2020, the company's distributable reserves amounted to approximately HKD 431,219,000, a decrease from HKD 439,348,000 in 2019[107]. - The company has established a dividend policy that considers cash levels, retained earnings, financial performance, expected capital expenditures, and financing arrangements[147]. Market and Operational Challenges - The COVID-19 pandemic significantly impacted the group's business operations, particularly in the first half of 2020, but performance improved in the second half due to effective government measures[11]. - The average new bidding price for selected drugs decreased by approximately 50% due to the implementation of centralized procurement policies in China[10]. - The group anticipates continued pricing pressure and potential loss of market share due to ongoing centralized procurement initiatives, which may further decrease sales volume and average profit margins[12]. - The group anticipates continued pricing pressure on pharmaceuticals due to national health insurance budget tightening and volume-based procurement policies[22]. Strategic Initiatives - The group is actively enhancing collaboration with suppliers and end customers to improve sales and marketing capabilities and expand its distribution network in China[12]. - The company plans to enhance its local distribution network and sales capabilities to strengthen its competitive advantage in China[24]. - The group aims to focus on its core business of pharmaceutical product distribution and marketing services, potentially divesting non-core assets in the future[25]. - The company has obtained distribution rights for new products, including a recombinant cytokine gene-derived protein injection and sildenafil orally disintegrating tablets, expected to launch in 2021[23]. Environmental and Social Responsibility - The group recognizes the importance of environmental policies and has implemented measures to reduce energy consumption and promote recycling[26]. - The company has implemented an internal environmental policy to manage its environmental impact and promote awareness among employees[195]. - The company has complied with the HKEX Environmental, Social and Governance Reporting Guidelines for the reporting year[189]. - The company aims to expand its market share and local distribution network in China by obtaining new exclusive distribution rights[192]. Corporate Governance and Compliance - The company has adopted corporate governance practices in line with the corporate governance code and has complied with applicable principles[151]. - The board consists of six members, including three executive directors and three independent non-executive directors, with no significant relationships among them[153]. - The company has established service contracts for its executive directors, with terms starting from June 27, 2020, for a duration of two years[110]. - The company has engaged an independent professional firm to review the effectiveness of its internal control system, which includes all significant operational processes[180]. Investments and Financial Position - As of December 31, 2020, the investment amount in Kang Jian International Medical Group Limited was approximately HKD 144.4 million, with a fair value of about HKD 36.3 million, representing 5.6% of the group's total assets[46]. - The fair value of the group's investment in HCMPS Healthcare Holdings Limited was approximately HKD 26.6 million as of December 31, 2020, down from HKD 42.0 million in 2019, accounting for 4.1% of total assets[51]. - The group recorded a fair value loss of approximately HKD 15.4 million on its investment in HCMPS for the year, compared to a loss of HKD 19.0 million in 2019[51]. - The group confirmed a fair value loss of approximately HKD 2.2 million on its investment in Weijian International for the year, compared to a loss of HKD 2.8 million in 2019[54]. Legal and Regulatory Issues - The company is at risk of delisting if shares remain suspended for 18 months, with the deadline set for January 31, 2020[81]. - The Securities and Futures Commission has filed a petition against two former directors for alleged misconduct related to acquisitions, including a claim for HKD 26 million[85]. - The independent investigation into the internal control systems is ongoing, with a report being prepared by an independent consultant[78]. - The company has been actively seeking legal advice to resolve the issues raised by the Securities and Futures Commission[79].

Financial Performance - For the six months ended June 30, 2020, the group recorded revenue of approximately HKD 69,470,000, an increase of about 25.1% compared to approximately HKD 55,511,000 for the same period in 2019[8]. - The net loss attributable to owners of the company for the six months ended June 30, 2020, was approximately HKD 36,434,000, an increase of about 367.2% compared to approximately HKD 7,798,000 for the same period in 2019[8]. - Revenue for the six months ended June 30, 2020, was HKD 69,470,000, representing an increase of 25% compared to HKD 55,511,000 for the same period in 2019[21]. - The company reported a loss before tax of HKD 36,633,000, compared to a loss of HKD 7,294,000 in the previous year, indicating a significant increase in losses[21]. - Total comprehensive expenses for the period amounted to HKD 61,064,000, compared to HKD 19,454,000 in the same period of 2019[21]. - Basic and diluted loss per share was HKD 2.18, compared to HKD 0.47 for the same period in 2019[21]. - The company recognized an impairment loss of HKD 22,235,000 on interests in associates during the period[21]. - The loss for the period was approximately HKD 36,434,000, an increase of about 367.2% compared to approximately HKD 7,798,000 for the same period in 2019[100]. Assets and Liabilities - Non-current assets decreased from HKD 378,374,000 as of December 31, 2019, to HKD 330,637,000 as of June 30, 2020[22]. - Current assets decreased from HKD 300,533,000 to HKD 283,252,000 during the same period[22]. - Total equity attributable to owners decreased from HKD 654,483,000 at the beginning of the year to HKD 593,419,000 by June 30, 2020[22]. - The total liabilities reported as of June 30, 2020, were 9,156 thousand HKD, down from 12,992 thousand HKD at the end of 2019[67]. - The group has pledged assets with a total carrying value of approximately 8,850,000 HKD as of June 30, 2020, compared to 9,347,000 HKD at the end of 2019[72]. - The group maintained a strong liquidity position with cash and cash equivalents of approximately HKD 101,334,000 as of June 30, 2020, compared to approximately HKD 88,668,000 as of December 31, 2019[102]. - The group had no significant contingent liabilities as of June 30, 2020[103]. Cash Flow - The net cash inflow from operating activities for 2020 was HKD 13,492,000, a significant improvement from a net outflow of HKD 57,737,000 in 2019[26]. - The net cash inflow from investing activities decreased to HKD 696,000 in 2020 from HKD 1,582,000 in 2019[26]. - The net cash outflow from financing activities increased to HKD 750,000 in 2020 compared to HKD 614,000 in 2019[26]. - The total cash and cash equivalents at the end of the period increased to HKD 101,334,000 from HKD 89,081,000 in 2019[26]. - The cash flow from operating activities showed a turnaround, indicating improved operational efficiency and financial health[26]. Investigations and Legal Matters - The company is currently undergoing an independent investigation related to acquisitions made in previous years, which has not yet reached a conclusive result[14]. - The investigation pertains to the acquisition of 50% interest in Saike International and 15% interest in WinHealth International, with acquisition costs of RMB 95,000,000 and RMB 47,250,000 respectively[14]. - The company has established an independent committee to investigate issues related to the acquisitions and handle matters concerning the trading suspension[13]. - The trading of the company's shares has been suspended since October 6, 2017, due to concerns raised by the Securities and Futures Commission regarding the accuracy of information related to the acquisitions[13]. - The company plans to seek legal advice to expedite the resumption of trading of its shares, which has been suspended since 2017[30]. - The company has not yet established a clear timetable for resuming trading, pending the outcome of ongoing investigations[30]. - The company is actively seeking legal advice to address the concerns raised by the Securities and Futures Commission and to restore trading of its shares[121]. Operational Performance - The company experienced operational impacts due to COVID-19, affecting marketing and promotional services during the reporting period[80]. - The company expects continued pricing pressure and potential market share loss due to the implementation of centralized drug procurement policies in China[88]. - The company plans to enhance its product portfolio by acquiring distribution rights for new products, with a new product launch planned for the end of 2020[89]. - The company aims to focus on its core business of pharmaceutical product distribution and marketing services, potentially considering the sale of non-core business assets in the near future[91]. - The company will continue to expand its local distribution network and enhance sales and marketing capabilities to strengthen its competitive advantage in China[90]. Shareholder Information - The company raised approximately HKD 343.6 million through a rights issue, issuing 1,249,344,000 shares at a subscription price of HKD 0.275 per share[125]. - As of June 30, 2020, the actual use of the net proceeds from the rights issue included approximately HKD 143.2 million for potential acquisitions in healthcare-related businesses[128]. - The company has a total of 1,671,846,657 shares issued as of June 30, 2020[135]. - Major shareholders include Yu Wenyong and Eagle Amber Holdings Limited, each holding 426,672,000 shares, representing 25.52% of total shares[135]. - Other significant shareholders include Qian Shenglei with 193,704,000 shares (11.59%) and Zhou Ling with 161,400,000 shares (9.65%)[135]. Corporate Governance - The audit committee reviewed the group's unaudited condensed consolidated financial statements for the period[146]. - The company complied with the corporate governance code as per the listing rules during the reporting period[142]. - The audit committee consists of three independent non-executive directors, with Li Qianming serving as the chairperson[145]. - No shares were purchased, sold, or redeemed by the company or its subsidiaries during the period[144].