Company Information [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) This section lists the executive directors, non-executive directors, independent non-executive directors, and the composition of the audit, remuneration, and nomination committees of Xinyuan Property Management Group Co., Ltd. - Executive Directors include **Mr. Shen Yuanqing** (Chairman of the Board), **Mr. Feng Bo**, and **Mr. Wang Yong** (Chief Financial Officer)[3](index=3&type=chunk) - Independent Non-Executive Directors include **Mr. Li Yifan**, **Mr. Ling Chenkai**, **Mr. Lan Ye**, and **Ms. Zhao Xia**[3](index=3&type=chunk) - **Ms. Zhao Xia** was appointed as a member of the Nomination Committee on **June 30, 2025**[3](index=3&type=chunk) [Company Contact and Service Institutions](index=3&type=section&id=Company%20Contact%20and%20Service%20Institutions) This section details the company's registered office, principal place of business, group headquarters, share registrar, legal counsel, principal bankers, auditors, overseas banks, stock code, and company website address. - The Cayman Islands registered office is located at **P.O. Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands**[4](index=4&type=chunk) - The principal place of business in Hong Kong is located at **Unit B, 17th Floor, United Centre, 95 Queensway, Admiralty, Hong Kong**[4](index=4&type=chunk) - The Company's stock code is **1895**, and its website address is **www.xypm.hk**[5](index=5&type=chunk) Management Discussion and Analysis [Overall Performance](index=5&type=section&id=Overall%20Performance) For the six months ended June 30, 2025, the company achieved significant growth in both total revenue and net profit, demonstrating robust operational performance. 2025 H1 Financial Performance | Indicator | 2025 H1 (RMB millions) | 2024 H1 (RMB millions) | YoY Growth (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 450.0 | 405.4 | 11.0 | | Net Profit | 60.9 | 52.7 | 15.6 | [Business Review](index=5&type=section&id=Business%20Review) As a comprehensive property management service provider, the Group achieved steady growth in the first half of 2025 by focusing on three growth drivers: "scaling management services, building an ecosystem for value-added scenarios, and leveraging technology for value." - The Group is committed to becoming a leading provider of quality-of-life services driven by new productivity in the large property management sector[9](index=9&type=chunk) - In the first half of 2025, the Group continued to focus on three growth curves: **"scaling management services, building an ecosystem for value-added scenarios, and leveraging technology for value,"** achieving steady growth[9](index=9&type=chunk) - As of **June 30, 2025**, property management services covered **71 cities** in China, with **7.3 million sq.m.** of new contracted area and **3.07 million sq.m.** of new managed area in the first half of the year[9](index=9&type=chunk) [Overview](index=5&type=section&id=Overview) The Group achieved steady performance growth in the first half of the year, enhancing management scale and quality through a "four-wheel drive" model, focusing on five core scenario services, and achieving digital collaborative development. - Management services deepened the **"local intensive cultivation, strategic cooperation, regional specialized expansion, and market bidding" four-wheel drive model** to ensure the quality of market expansion projects[9](index=9&type=chunk) - Scenario services focused on **five core businesses: leasing, home improvement, retail, purified water, and home services**, promoting collaborative development through digital tools[10](index=10&type=chunk) 2025 H1 Scenario Services Revenue YoY Growth | Business Type | YoY Growth (%) | | :--- | :--- | | Home Improvement Services | 23 | | Leasing Services | 129 | | Purified Water Services | 17 | - Scenario technology, centered on **"IoT platform + intelligent agent platform + data platform,"** pioneered the application of AI technology in property scenarios, launching **"Customer Service Intelligent Agent" and "Butler Intelligent Agent"**[11](index=11&type=chunk) - The Group received multiple honors, including **TOP 8 in Leju Finance's 2025 China Property Service Satisfaction Top 100 Enterprises** and **TOP 15 in China Index Academy's 2025 China Property Service Top 100 Enterprises**[12](index=12&type=chunk) [Property Management Services](index=7&type=section&id=Property%20Management%20Services) The Group adheres to a quality-driven development strategy, signing contracts for 7.3 million square meters in the first half of the year, with an increased proportion of non-residential properties. - In the first half of 2025, the Group signed contracts for a total of **7.3 million sq.m.**, including **3.34 million sq.m. of residential** and **3.96 million sq.m. of non-residential**, with the proportion of non-residential properties further increasing[14](index=14&type=chunk) Contracted and Managed Area and Project Count | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Contracted GFA (thousand sq.m.) | 67,404 | 60,924 | | Number of Contracted Projects (units) | 390 | 342 | | Managed GFA (thousand sq.m.) | 40,179 | 35,718 | | Number of Managed Projects (units) | 271 | 240 | - As of **June 30, 2025**, the Group's property management services covered **71 cities** nationwide, continuously expanding its national footprint[16](index=16&type=chunk) GFA and Property Management Services Revenue by Geographical Region | Region | 2025 GFA (thousand sq.m.) | 2025 Revenue (thousand RMB) | 2025 Revenue Share (%) | 2024 GFA (thousand sq.m.) | 2024 Revenue (thousand RMB) | 2024 Revenue Share (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Central China | 21,164 | 159,947 | 50.7 | 20,759 | 153,441 | 55.1 | | East China | 9,287 | 69,870 | 22.2 | 6,516 | 62,234 | 22.3 | | West China | 5,303 | 39,457 | 12.5 | 7,117 | 40,648 | 14.6 | | North China | 1,603 | 18,462 | 5.9 | 776 | 11,908 | 4.3 | | South China | 2,822 | 27,559 | 8.7 | 550 | 10,379 | 3.7 | | Total | 40,179 | 315,295 | 100.0 | 35,718 | 278,610 | 100.0 | - As of **June 30, 2025**, **59%** of the Group's managed GFA was from third parties, and **68%** of contracted GFA was from third parties[24](index=24&type=chunk) Managed Area and Property Management Services Revenue Share by Property Developer Type | Developer Type | 2025 Revenue (thousand RMB) | 2025 Revenue Share (%) | 2025 Managed GFA (thousand sq.m.) | 2025 Managed GFA Share (%) | 2024 Revenue (thousand RMB) | 2024 Revenue Share (%) | 2024 Managed GFA (thousand sq.m.) | 2024 Managed GFA Share (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Xinyuan Real Estate Group | 188,863 | 59.9 | 16,496 | 41.1 | 188,446 | 67.6 | 16,175 | 45.3 | | Independent Third Parties | 126,432 | 40.1 | 23,683 | 58.9 | 90,164 | 32.4 | 19,543 | 54.7 | | Total | 315,295 | 100.0 | 40,179 | 100.0 | 278,610 | 100.0 | 35,718 | 100.0 | Property Management Services Revenue and Managed Area by Property Type | Property Type | 2025 Revenue (thousand RMB) | 2025 Revenue Share (%) | 2025 Managed GFA (thousand sq.m.) | 2025 Managed GFA Share (%) | 2024 Revenue (thousand RMB) | 2024 Revenue Share (%) | 2024 Managed GFA (thousand sq.m.) | 2024 Managed GFA Share (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Residential Properties | 237,795 | 75.4 | 28,326 | 70.5 | 223,144 | 80.1 | 25,562 | 71.6 | | Non-Residential Properties | 77,500 | 24.6 | 11,853 | 29.5 | 55,466 | 19.9 | 10,156 | 28.4 | | Total | 315,295 | 100.0 | 40,179 | 100.0 | 278,610 | 100.0 | 35,718 | 100.0 | [Value-Added Services](index=12&type=section&id=Value-Added%20Services) In the first half of 2025, the Group's community value-added services revenue reached RMB 102.7 million, a year-on-year increase of 23.6%, with significant growth in leasing, home improvement, and purified water businesses. - For the six months ended **June 30, 2025**, community value-added revenue reached **RMB 102.7 million**, a year-on-year increase of **23.6%**[30](index=30&type=chunk) - **Leasing services revenue** increased by **129%** year-on-year, **home improvement business revenue** increased by **23%** year-on-year, and **purified water business revenue** increased by **17%** year-on-year[30](index=30&type=chunk)[31](index=31&type=chunk) - Retail business innovated the **"procurement + operation + delivery" iron triangle model**, expanding community private domain groups[31](index=31&type=chunk) Community Value-Added Services Revenue Breakdown | Value-Added Business | 2025 (thousand RMB) | 2025 Share (%) | 2024 (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Third-Party Services Revenue | 14,108 | 13.8 | 10,659 | 12.8 | | Space Resource Management | 53,207 | 51.8 | 42,834 | 51.6 | | Home Life Services | 35,345 | 34.4 | 29,558 | 35.6 | | Total | 102,660 | 100.0 | 83,051 | 100.0 | [Pre-delivery and Consulting Services](index=13&type=section&id=Pre-delivery%20and%20Consulting%20Services) The Group's pre-delivery and consulting services revenue continued to decline, primarily due to strengthened risk control over business partners. - Pre-delivery and consulting services revenue continued to decline, mainly due to **strengthened risk control over partners**[35](index=35&type=chunk) Pre-delivery and Consulting Services Revenue Breakdown | Service Source | 2025 (thousand RMB) | 2025 Share (%) | 2024 (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Xinyuan Real Estate Group | 918 | 31.6 | 3,969 | 56.8 | | Third-Party Property Developers | 1,991 | 68.4 | 3,022 | 43.2 | | Total | 2,909 | 100.0 | 6,991 | 100.0 | [Property Engineering Services](index=14&type=section&id=Property%20Engineering%20Services) Property engineering services include fire protection, intelligent construction, landscaping, and smart community planning, with the Group also participating in government-led urban renewal projects. - Property engineering services cover **fire protection, intelligent construction, landscaping and landscape construction, smart community planning and construction**, among others[37](index=37&type=chunk) - The Group participates in **government-led urban renewal projects** and **renovation projects for old communities**[37](index=37&type=chunk) Property Engineering Services Revenue Breakdown | Service Source | 2025 (thousand RMB) | 2025 Share (%) | 2024 (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Xinyuan Real Estate Group | 14,353 | 49.2 | 24,844 | 67.6 | | Third-Party Property Developers | 14,799 | 50.8 | 11,913 | 32.4 | | Total | 29,152 | 100.0 | 36,757 | 100.0 | [Outlook](index=15&type=section&id=Outlook) The Group is committed to becoming a leading provider of quality-of-life services driven by new productivity in the large property management sector, and will continue to focus on this area, leveraging data-driven operations and deep integration of technology and business. - The Group is committed to becoming a **leading provider of quality-of-life services driven by new productivity in the large property management sector**[40](index=40&type=chunk) - Future focus will remain on the **large property management sector**, with **data-driven operations** and **deep integration of technology and business**[40](index=40&type=chunk) - The company will continuously upgrade its three development curves: **management services, scenario value-added services, and technology empowerment**, to achieve sustained growth in operational efficiency and business scale[40](index=40&type=chunk) [I. Management Services](index=15&type=section&id=I.%20Management%20Services) Management services will focus on high-quality development, solidifying service quality and continuously expanding scale from residential properties to non-residential, public buildings, and extending to commercial management and asset services. - Management services will focus on **high-quality development**, continuously extending from residential properties to **non-residential, public buildings**, and expanding into **commercial management and asset services**[41](index=41&type=chunk) - Scale expansion will center on **market-oriented growth**, innovating diverse cooperation models, extending from incremental to existing, and from residential to non-residential, urban, and specialized services[41](index=41&type=chunk) - Basic service capabilities will be enhanced through **data-driven management efficiency improvements**, strengthening refined and differentiated management and service capabilities, and improving operational efficiency and customer living experience[41](index=41&type=chunk) [II. Scenario Services](index=15&type=section&id=II.%20Scenario%20Services) Diversified business operations will deepen the "technology empowerment + scenario extension + model replication" strategy, utilizing intelligent agents to analyze user behavior and AI to generate marketing materials, thereby improving business quality and efficiency. - Diversified business operations will deepen the **"technology empowerment + scenario extension + model replication" strategy** around five core businesses[42](index=42&type=chunk) - Increased integration of technology will use **intelligent agents to analyze user behavior for precise lead generation** and **AI to generate marketing materials** to enhance promotional efficiency[42](index=42&type=chunk) - Promotion of deep integration between **leasing, home improvement, and the Xinyi Family and Xinduo Duo platforms** will build a **"service + commerce" smart community ecosystem**, supporting dual growth in diversified business revenue and profit[42](index=42&type=chunk) [III. Scenario Technology](index=16&type=section&id=III.%20Scenario%20Technology) Technology business will focus on building new productivity for large property management, with a core positioning of "technology empowerment for large property enterprises and diversified business support for small and medium property enterprises," continuously improving and optimizing the intelligent agent platform. - Technology business focuses on building **new productivity for large property management**, with a core positioning of **"technology empowerment for large property enterprises and diversified business support for small and medium property enterprises"**[43](index=43&type=chunk) - Continuous improvement and optimization of the **intelligent agent platform** will create an intelligent agent development base suitable for the property industry, promoting deep integration of technology and business[43](index=43&type=chunk) - Building a **digital intelligence-driven smart operation and management system** will create a smart property technology ecosystem with independent core capabilities, comprehensively enhancing enterprise management, operation, and service capabilities[43](index=43&type=chunk) [Financial Review](index=16&type=section&id=Financial%20Review) The Group demonstrated robust financial performance in the first half of 2025, with total revenue increasing by 11.0% year-on-year to RMB 450.0 million and net profit growing by 15.6% to RMB 60.9 million. 2025 H1 Key Financial Indicators | Indicator | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 450,016 | 405,409 | 11.0 | | Gross Profit | 155,443 | 132,227 | 17.5 | | Gross Profit Margin | 34.5% | 32.6% | +1.9pp | | Net Profit | 60,927 | 52,661 | 15.6 | | Profit Attributable to Equity Holders of the Company | 59,411 | 50,850 | 16.7 | | Basic Earnings Per Share (RMB cents) | 10.29 | 8.96 | 14.8 | | Current Assets | 990,871 | 1,039,832 (Dec 31, 2024) | -4.7 | | Total Equity | 634,843 | 588,680 (Dec 31, 2024) | 7.8 | [Revenue](index=16&type=section&id=Revenue) For the six months ended June 30, 2025, the Group's total revenue was approximately RMB 450.0 million, a year-on-year increase of 11.0%. Property management services remained the primary revenue source, accounting for 70.1% of total revenue. Revenue by Business Line | Business Line | 2025 Revenue (thousand RMB) | 2025 Share (%) | 2024 Revenue (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Property Management Services | 315,295 | 70.1 | 278,610 | 68.7 | | Value-Added Services | 102,660 | 22.8 | 83,051 | 20.5 | | Pre-delivery and Consulting Services | 2,909 | 0.6 | 6,991 | 1.7 | | Property Engineering Services | 29,152 | 6.5 | 36,757 | 9.1 | | Total | 450,016 | 100.0 | 405,409 | 100.0 | [Gross Profit and Gross Profit Margin](index=17&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) The Group's gross profit increased by 17.5% year-on-year to RMB 155.4 million, with the gross profit margin rising from 32.6% in 2024 to 34.5%. Gross Profit and Gross Profit Margin by Business Line | Business Line | 2025 Gross Profit (thousand RMB) | 2025 Gross Profit Margin (%) | 2024 Gross Profit (thousand RMB) | 2024 Gross Profit Margin (%) | | :--- | :--- | :--- | :--- | :--- | | Property Management Services | 102,542 | 32.5 | 84,211 | 30.2 | | Value-Added Services | 49,239 | 48.0 | 39,417 | 47.5 | | Pre-delivery and Consulting Services | 482 | 16.6 | 2,514 | 36.0 | | Property Engineering Services | 3,180 | 10.9 | 6,085 | 16.6 | | Total | 155,443 | 34.5 | 132,227 | 32.6 | - Property management services gross profit margin increased by **2.3 percentage points to 32.5%**, mainly due to **improved economies of scale, better cost-saving measures, and enhanced operational efficiency**[47](index=47&type=chunk) - Pre-delivery and consulting services gross profit margin decreased by **19.4 percentage points to 16.6%**, primarily due to a **reduction in asset co-sales business, such as parking spaces**[47](index=47&type=chunk) [Administrative Expenses](index=18&type=section&id=Administrative%20Expenses) For the six months ended June 30, 2025, administrative expenses were RMB 42.0 million, an increase of 19.7% year-on-year, accounting for 9.3% of revenue. Administrative Expenses | Indicator | 2025 H1 (RMB millions) | 2024 H1 (RMB millions) | YoY Change (%) | Share of Revenue (2025) | Share of Revenue (2024) | | :--- | :--- | :--- | :--- | :--- | :--- | | Administrative Expenses | 42.0 | 35.1 | 19.7 | 9.3% | 8.7% | [Other Income, Gains and Losses, Net](index=18&type=section&id=Other%20Income%2C%20Gains%20and%20Losses%2C%20Net) For the six months ended June 30, 2025, other income was a net negative RMB 1.0 million, a significant decrease of 103.0% from RMB 32.8 million in the prior period. Other Income, Gains and Losses, Net | Indicator | 2025 H1 (RMB millions) | 2024 H1 (RMB millions) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Other Income, Gains and Losses, Net | -1.0 | 32.8 | -103.0 | - The decrease was primarily attributable to **lower interest income in the current period**[49](index=49&type=chunk) [Income Tax Expense](index=18&type=section&id=Income%20Tax%20Expense) For the six months ended June 30, 2025, income tax expense was RMB 14.0 million, a decrease of RMB 7.5 million from RMB 21.5 million in the prior period. Income Tax Expense | Indicator | 2025 H1 (RMB millions) | 2024 H1 (RMB millions) | YoY Change (RMB millions) | | :--- | :--- | :--- | :--- | | Income Tax Expense | 14.0 | 21.5 | -7.5 | - The decrease was primarily attributable to a **reduction in deferred tax liabilities recognized and a decrease in non-deductible expenses** in the current period[50](index=50&type=chunk) [Profit](index=18&type=section&id=Profit) For the six months ended June 30, 2025, the Group's net profit for the period was RMB 60.9 million, a year-on-year increase of 15.6%, mainly due to business growth driven by increased GFA under management. Net Profit and Earnings Per Share | Indicator | 2025 H1 (RMB millions) | 2024 H1 (RMB millions) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Profit for the Period | 60.9 | 52.7 | 15.6 | | Profit Attributable to Equity Holders of the Company | 59.4 | 50.9 | 16.7 | | Basic Earnings Per Share (RMB cents) | 10.29 | 8.96 | 14.8 | - The increase in net profit was primarily due to **business growth driven by the Group's increased GFA under management**[51](index=51&type=chunk) [Current Assets, Reserves and Capital Structure](index=19&type=section&id=Current%20Assets%2C%20Reserves%20and%20Capital%20Structure) As of June 30, 2025, the Group's current assets were RMB 990.9 million, a 4.7% decrease from December 31, 2024. Total equity was RMB 634.8 million, a 7.8% increase from December 31, 2024. Current Assets and Total Equity | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Current Assets | 990.9 | 1,039.8 | -4.7 | | Total Equity | 634.8 | 588.7 | 7.8 | - The increase in total equity was primarily due to **profit for the period offset by dividends paid**[54](index=54&type=chunk) [Property, Plant and Equipment](index=19&type=section&id=Property%2C%20Plant%20and%20Equipment) As of June 30, 2025, the Group's net property, plant and equipment was RMB 13.0 million, a 2.3% decrease from December 31, 2024. Net Property, Plant and Equipment | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Net Property, Plant and Equipment | 13.0 | 13.3 | -2.3 | - The decrease was primarily due to **increased purchases of office equipment and machinery for business development, partially offset by depreciation for the period**[55](index=55&type=chunk) [Intangible Assets](index=19&type=section&id=Intangible%20Assets) As of June 30, 2025, the carrying value of the Group's other intangible assets was RMB 36.3 million, a 6.7% decrease from December 31, 2024. Carrying Value of Intangible Assets | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Carrying Value of Intangible Assets | 36.3 | 38.9 | -6.7 | - Key intangible assets include the **Xinyuan Property unified management platform system, call center system, electronic invoice tax control server invoicing system, FanRuan reporting software, expense management system, and property operating rights**[56](index=56&type=chunk) [Trade Receivables](index=19&type=section&id=Trade%20Receivables) As of June 30, 2025, trade receivables reached RMB 361.8 million, an 11.4% increase from December 31, 2024, primarily due to business growth driven by increased GFA under management. Trade Receivables | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Receivables | 361.8 | 324.8 | 11.4 | - The increase was primarily due to **business growth driven by the Group's increased GFA under management**[57](index=57&type=chunk) [Prepayments and Other Receivables](index=19&type=section&id=Prepayments%20and%20Other%20Receivables) As of June 30, 2025, prepayments and other receivables were approximately RMB 384.9 million, a decrease of approximately RMB 11.4 million from December 31, 2024. Prepayments and Other Receivables | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (RMB millions) | | :--- | :--- | :--- | :--- | | Prepayments and Other Receivables | 384.9 | 396.3 | -11.4 | - The decrease was primarily due to a **reduction in amounts due from and prepaid to related parties**[58](index=58&type=chunk) [Trade Payables](index=20&type=section&id=Trade%20Payables) As of June 30, 2025, trade payables reached RMB 121.6 million, a 16.1% decrease from December 31, 2024. Trade Payables | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Payables | 121.6 | 145.0 | -16.1 | - The decrease was primarily due to a **reduction in goods payments temporarily unpaid during the period**[59](index=59&type=chunk) [Other Payables and Accrued Expenses](index=20&type=section&id=Other%20Payables%20and%20Accrued%20Expenses) As of June 30, 2025, other payables and accrued expenses were approximately RMB 232.9 million, a decrease of approximately 11.8% from December 31, 2024. Other Payables and Accrued Expenses | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Other Payables and Accrued Expenses | 232.9 | 264.2 | -11.8 | - The decrease was primarily due to a **reduction in non-trade amounts payable to related parties and normal refunds of deposits and temporary receipts from property owners**[60](index=60&type=chunk) [Contract Liabilities](index=20&type=section&id=Contract%20Liabilities) As of June 30, 2025, contract liabilities were approximately RMB 131.8 million, an 8.8% decrease from December 31, 2024. Contract Liabilities | Indicator | June 30, 2025 (RMB millions) | Dec 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Contract Liabilities | 131.8 | 144.5 | -8.8 | - The decrease was primarily due to the Group's focus on **enhancing owner service quality, leading to a slowdown in property fee prepayment activities**[61](index=61&type=chunk) [Borrowings and Gearing Ratio](index=20&type=section&id=Borrowings%20and%20Gearing%20Ratio) As of June 30, 2025, the Group had no borrowings or bank loans, resulting in a zero gearing ratio, indicating a robust financial position. - As of **June 30, 2025**, the Group had **no borrowings or bank loans**[62](index=62&type=chunk) - As of **June 30, 2025**, the **gearing ratio was zero**[63](index=63&type=chunk) [Pledge of Assets, Major Acquisitions, Disposals and Investments](index=20&type=section&id=Pledge%20of%20Assets%2C%20Major%20Acquisitions%2C%20Disposals%20and%20Investments) For the six months ended June 30, 2025, the Group had no assets pledged, nor any major acquisitions, disposals, or investments concerning subsidiaries, associates, or joint ventures. - As of **June 30, 2025**, **no assets of the Group were pledged**[64](index=64&type=chunk) - For the six months ended **June 30, 2025**, the Group had **no major acquisitions** concerning subsidiaries, associates, or joint ventures[65](index=65&type=chunk) - For the six months ended **June 30, 2025**, the Group had **no major disposals or investments** concerning subsidiaries, associates, or joint ventures[67](index=67&type=chunk)[68](index=68&type=chunk) [Contingent Liabilities and Foreign Exchange Risk](index=21&type=section&id=Contingent%20Liabilities%20and%20Foreign%20Exchange%20Risk) As of June 30, 2025, the Group had no significant contingent liabilities. As its principal operations are conducted in China and most income and expenses are denominated in RMB, the Group's foreign exchange risk is not significant. - As of **June 30, 2025**, the Group had **no significant contingent liabilities**[69](index=69&type=chunk) - The Group's principal operations are conducted in China, with most income and expenses denominated in RMB, thus **foreign exchange risk is not significant**[70](index=70&type=chunk) - The Group currently has **not entered into any forward contracts to hedge its foreign exchange risk**[70](index=70&type=chunk) [Employment and Remuneration Policies](index=21&type=section&id=Employment%20and%20Remuneration%20Policies) As of June 30, 2025, the Group employed 2,139 staff, a slight increase from the prior period. The company adopts remuneration policies similar to its peers, determining compensation based on responsibilities and market levels. Employee Count | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Employee Count | 2,139 | 2,104 | - Remuneration policies are **similar to industry peers**, determined by reference to **responsibilities and current market levels** in the region[71](index=71&type=chunk) - Discretionary performance bonuses are paid to employees, and the Group participates in various social welfare schemes for employees[71](index=71&type=chunk) [Use of Proceeds from Listing](index=21&type=section&id=Use%20of%20Proceeds%20from%20Listing) The net proceeds from the Company's listing were approximately RMB 197.2 million. As of June 23, 2022, approximately RMB 79.3 million had been utilized, with RMB 117.9 million remaining unutilized. - Net proceeds from the listing were approximately **RMB 197.2 million**[72](index=72&type=chunk) Use of Net Proceeds from Listing and Utilization (as of June 23, 2022) | Purpose | Intended Use (RMB millions) | Actual Use as of Dec 31, 2021 (RMB millions) | Actual Use as of June 23, 2022 (RMB millions) | Unutilized as of June 23, 2022 (RMB millions) | | :--- | :--- | :--- | :--- | :--- | | Expand property management services, seek strategic acquisition and investment opportunities | 118.3 | 22.2 | 0.8 | 95.3 | | Expand types of services offered by value-added services business line | 29.6 | 22.8 | 2.0 | 4.8 | | Upgrade and develop proprietary information technology and smart systems | 29.6 | 6.6 | 5.2 | 17.8 | | Working capital needs and other general corporate purposes | 19.7 | 19.7 | – | – | | Total | 197.2 | 71.3 | 8.0 | 117.9 | [Use of Proceeds from 2020 Placing](index=23&type=section&id=Use%20of%20Proceeds%20from%202020%20Placing) The net proceeds from the 2020 placing were approximately RMB 115.0 million. As of June 23, 2022, approximately RMB 11.5 million had been utilized, with RMB 103.5 million remaining unutilized. - Net proceeds from the 2020 placing were approximately **RMB 115.0 million**[76](index=76&type=chunk) Use of Net Proceeds from 2020 Placing and Utilization (as of June 23, 2022) | Purpose | Intended Use (RMB millions) | Actual Use as of Dec 31, 2021 (RMB millions) | Actual Use as of June 23, 2022 (RMB millions) | Unutilized as of June 23, 2022 (RMB millions) | | :--- | :--- | :--- | :--- | :--- | | Business development (diversified services and smart system upgrades) | 69.0 | – | – | 69.0 | | Strategic investments related to the Group's principal business | 34.5 | – | – | 34.5 | | General working capital | 11.5 | 11.5 | – | – | | Total | 115.0 | 11.5 | – | 103.5 | [Use of Proceeds from Subscription](index=25&type=section&id=Use%20of%20Proceeds%20from%20Subscription) The net proceeds from the subscription were approximately HKD 31.2 million (approximately RMB 28.5 million). As of June 23, 2022, approximately RMB 7.8 million had been utilized, with RMB 23.4 million remaining unutilized. - Net proceeds from the subscription were approximately **HKD 31.2 million**[79](index=79&type=chunk) Use of Net Proceeds from Subscription and Utilization (as of June 23, 2022) | Purpose | Intended Use (RMB millions) | Actual Use as of Dec 31, 2021 (RMB millions) | Actual Use as of June 23, 2022 (RMB millions) | Unutilized as of June 23, 2022 (RMB millions) | | :--- | :--- | :--- | :--- | :--- | | Approx. 75% for strategic investments related to property management services | 23.4 | – | – | 23.4 | | Approx. 25% for the Group's general working capital | 7.8 | 7.8 | – | – | | Total | 31.2 | 7.8 | – | 23.4 | [Change in Use of Proceeds](index=27&type=section&id=Change%20in%20Use%20of%20Proceeds) The Board has resolved to change the use of the unutilized aggregate proceeds from the listing, 2020 placing, and subscription (approximately RMB 244.8 million). As of June 30, 2025, approximately RMB 156.0 million had been utilized. - The Board has resolved to change the use of the **unutilized aggregate proceeds from the listing, 2020 placing, and subscription (approximately RMB 244.8 million)**[80](index=80&type=chunk) - As of **June 30, 2025**, approximately **RMB 156.0 million** of the unutilized aggregate proceeds had been utilized[80](index=80&type=chunk) - The expected utilization time for the unutilized portion of the aggregate proceeds has been **extended from September 30, 2025, to September 30, 2026**[83](index=83&type=chunk) Revised Use of Unutilized Aggregate Proceeds and Utilization (as of June 30, 2025) | Revised Purpose | Allocation Percentage (%) | Allocated as of June 23, 2022 (RMB millions) | Allocated as of Jan 1, 2024 (RMB millions) | Actual Use in 2024 (RMB millions) | Unutilized as of Dec 31, 2024 (RMB millions) | Actual Use in 2025 (RMB millions) | Unutilized as of June 30, 2025 (RMB millions) | Expected Utilization Timeline | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Seize strategic investment opportunities, prioritize M&A, expand business scale | 30 | 73.4 | 73.4 | 3.0 | 70.4 | 1.9 | 68.5 | Sep 30, 2026 | | Further develop value-added services | 20 | 49.0 | 41.5 | 26.7 | 14.8 | 10.9 | 3.9 | Sep 30, 2026 | | Upgrade digital and smart management systems | 30 | 73.4 | 54.6 | 29.4 | 25.2 | 8.8 | 16.4 | Sep 30, 2026 | | Working capital and general corporate purposes | 20 | 49.0 | – | – | – | – | – | – | | Total | 100.0 | 244.8 | 169.5 | 59.1 | 110.4 | 21.6 | 88.8 | | Other Information [Directors' and Chief Executive's Interests](index=30&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests) As of June 30, 2025, Mr. Shen Yuanqing and Mr. Wang Yong, as directors and chief executives, held shares in the Company through controlled corporations and owner's interests. Directors' and Chief Executive's Interests in the Company | Name | Nature of Interest | Number of Shares or Related Shares | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | Mr. Shen Yuanqing | Interest in controlled corporation | 61,488,000 | 10.37% | | Mr. Wang Yong | Interest in controlled corporation | 8,512,500 | 1.52% | | | Owner's interest | 488,000 | | - All interests are **long positions**, and the shareholding percentages are calculated based on **593,037,500 issued shares** as of June 30, 2025[86](index=86&type=chunk) [Directors' Rights to Acquire Shares or Debentures](index=31&type=section&id=Directors%27%20Rights%20to%20Acquire%20Shares%20or%20Debentures) For the six months ended June 30, 2025, no rights were granted to any director or their spouse or children under 18 years of age to acquire benefits by purchasing shares or debentures of the Company, nor were any such rights exercised. - For the six months ended **June 30, 2025**, no rights to acquire shares or debentures were granted to or exercised by any director or their spouse or children under 18 years of age[88](index=88&type=chunk) [Substantial Shareholders' Interests](index=31&type=section&id=Substantial%20Shareholders%20Interests) As of June 30, 2025, Xinyuan Real Estate Co., Ltd. and Xinyuan Real Estate Holdings Co., Ltd. were substantial shareholders of the Company, each holding 43.07% of the shares. Substantial Shareholders' Interests in Shares and Related Shares | Name | Capacity/Nature of Interest | Number of Shares | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Xinyuan Real Estate Co., Ltd. | Beneficial owner | 255,402,000 | 43.07% | | Xinyuan Real Estate Holdings Co., Ltd. | Interest in controlled corporation | 255,402,000 | 43.07% | - Xinyuan Real Estate Co., Ltd. is **wholly owned by Xinyuan Real Estate Holdings Co., Ltd.**[91](index=91&type=chunk) - Xinyuan Real Estate Holdings Co., Ltd.'s shares are **listed on the New York Stock Exchange**[91](index=91&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=32&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) For the period from January 1, 2025, to June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's securities listed on the Stock Exchange, and the Company held no treasury shares. - For the period from **January 1, 2025, to June 30, 2025**, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's securities listed on the Stock Exchange[92](index=92&type=chunk) - As of **June 30, 2025**, the Company held **no treasury shares**[92](index=92&type=chunk) [Interim Dividend](index=32&type=section&id=Interim%20Dividend) The Board recommends paying an interim dividend of 2.77 HK cents per share for the year ended June 30, 2025, to shareholders whose names appear on the register of members on September 15, 2025. - The Board recommends paying an interim dividend of **2.77 HK cents per share** for the year ended June 30, 2025[93](index=93&type=chunk) - The proposed interim dividend will be paid on **September 22, 2025**, to shareholders whose names appear on the Company's register of members on **September 15, 2025**[93](index=93&type=chunk) [Corporate Governance and Directors' Code of Conduct](index=32&type=section&id=Corporate%20Governance%20and%20Directors%27%20Code%20of%20Conduct) The Company is committed to high standards of corporate governance and has adopted the Corporate Governance Code set out in Appendix C1 of the HKEX Listing Rules. - The Company has adopted the **Corporate Governance Code** set out in Appendix C1 of the HKEX Listing Rules[94](index=94&type=chunk) - The roles of Chairman and Chief Executive Officer are combined and held by **Mr. Shen Yuanqing**, which the Board believes facilitates business strategy execution, promotes operational efficiency, and enhances overall strategic planning efficiency[94](index=94&type=chunk) - The Company has adopted a **code of conduct for directors' securities transactions**, and all directors confirm compliance[97](index=97&type=chunk) [Update on Directors' Information and Review of Financial Statements](index=33&type=section&id=Update%20on%20Directors%27%20Information%20and%20Review%20of%20Financial%20Statements) In accordance with Listing Rule 13.51B(1), Ms. Zhao Xia was appointed as a member of the Company's Nomination Committee effective June 30, 2025. The Audit Committee has reviewed the Group's unaudited interim results for the six months ended June 30, 2025, with management. - **Ms. Zhao Xia** was appointed as a member of the Company's Nomination Committee, effective **June 30, 2025**[98](index=98&type=chunk) - The Audit Committee has reviewed the Group's **unaudited interim results** for the six months ended June 30, 2025, together with management[99](index=99&type=chunk) Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income [Profit or Loss and Total Comprehensive Income](index=34&type=section&id=Profit%20or%20Loss%20and%20Total%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group's revenue was RMB 450.0 million, and gross profit was RMB 155.4 million. Profit and total comprehensive income for the period was RMB 60.9 million, with profit attributable to equity holders of the Company at RMB 59.4 million, and basic earnings per share at RMB 10.29 cents. Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary | Indicator | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Revenue | 450,016 | 405,409 | | Cost of Sales | (294,573) | (273,182) | | Gross Profit | 155,443 | 132,227 | | Other Income, Gains and Losses, Net | (1,039) | 32,753 | | Administrative Expenses | (42,005) | (35,133) | | Selling and Marketing Expenses | (14,918) | (11,363) | | Research and Development Expenses | (8,698) | (7,746) | | Impairment Provisions for Financial Assets and Contract Assets (excluding related parties) | (31,555) | (65,373) | | Impairment Reversals for Financial Assets and Contract Assets (related parties) | 19,125 | 30,414 | | Profit Before Income Tax | 74,881 | 74,144 | | Income Tax Expense | (13,954) | (21,483) | | Profit and Total Comprehensive Income for the Period | 60,927 | 52,661 | | Profit Attributable to Equity Holders of the Company | 59,411 | 50,850 | | Non-controlling Interests | 1,516 | 1,811 | | Basic Earnings Per Share (RMB cents) | 10.29 | 8.96 | Interim Condensed Consolidated Statement of Financial Position [Assets and Liabilities](index=35&type=section&id=Assets%20and%20Liabilities) As of June 30, 2025, the Group's total non-current assets were RMB 258.9 million, and total current assets were RMB 990.9 million. Total current liabilities were RMB 588.0 million, and total non-current liabilities were RMB 26.9 million. Interim Condensed Consolidated Statement of Financial Position Summary | Indicator | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | **Non-Current Assets** | | | | Property, Plant and Equipment | 12,954 | 13,335 | | Right-of-Use Assets | 31,225 | 38,692 | | Intangible Assets | 36,270 | 38,929 | | Investment Properties | 70,052 | 49,574 | | Deferred Tax Assets | 53,129 | 45,273 | | **Total Non-Current Assets** | **258,863** | **240,884** | | **Current Assets** | | | | Inventories | 50,579 | 43,710 | | Trade and Bills Receivables | 361,790 | 324,826 | | Cash and Cash Equivalents | 192,338 | 264,018 | | **Total Current Assets** | **990,871** | **1,039,832** | | **Current Liabilities** | | | | Trade Payables | 121,578 | 144,963 | | Other Payables and Accrued Expenses | 232,880 | 264,179 | | Contract Liabilities | 131,766 | 144,489 | | Tax Payable | 88,276 | 84,450 | | **Total Current Liabilities** | **588,019** | **652,350** | | **Non-Current Liabilities** | | | | Lease Liabilities | 21,322 | 32,781 | | Deferred Tax Liabilities | 5,550 | 6,905 | | **Total Non-Current Liabilities** | **26,872** | **39,686** | | **Net Assets** | **634,843** | **588,680** | | **Total Equity** | **634,843** | **588,680** | Interim Condensed Consolidated Statement of Changes in Equity [Changes in Equity](index=37&type=section&id=Changes%20in%20Equity) For the six months ended June 30, 2025, total equity attributable to equity holders of the Company increased from approximately RMB 584.0 million as of January 1, 2025, to approximately RMB 628.6 million, primarily driven by profit and total comprehensive income of RMB 59.4 million for the period. Interim Condensed Consolidated Statement of Changes in Equity Summary | Indicator | As of Jan 1, 2024 (thousand RMB) | As of June 30, 2024 (thousand RMB) | As of Jan 1, 2025 (thousand RMB) | As of June 30, 2025 (thousand RMB) | | :--- | :--- | :--- | :--- | :--- | | Total Equity Attributable to Equity Holders of the Company | 538,632 | 569,511 | 583,987 | 628,634 | | Non-controlling Interests | 3,094 | 4,905 | 4,693 | 6,209 | | Total Equity | 541,726 | 574,416 | 588,680 | 634,843 | | Dividends Distributed | (19,971) | (19,971) | (14,764) | (14,764) | | Profit and Total Comprehensive Income for the Period | 50,850 | 50,850 | 59,411 | 59,411 | Interim Condensed Consolidated Statement of Cash Flows [Cash Flow Analysis](index=38&type=section&id=Cash%20Flow%20Analysis) For the six months ended June 30, 2025, net cash used in operating activities was RMB 56.0 million, net cash used in investing activities was RMB 1.1 million, and net cash used in financing activities was RMB 13.4 million. Interim Condensed Consolidated Statement of Cash Flows Summary | Indicator | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (56,025) | (15,006) | | Net Cash (Used in)/Generated from Investing Activities | (1,054) | 14,646 | | Net Cash Used in Financing Activities | (13,421) | (24,036) | | Net Decrease in Cash and Cash Equivalents | (70,500) | (24,396) | | Cash and Cash Equivalents at Beginning of Period | 264,018 | 258,957 | | Cash and Cash Equivalents at End of Period | 192,338 | 234,383 | Notes to the Interim Condensed Consolidated Financial Information [1. Company and Group Information](index=40&type=section&id=1.%20Company%20and%20Group%20Information) The Company was incorporated in the Cayman Islands on December 13, 2018, and its shares are listed on the Main Board of the Hong Kong Stock Exchange. The Company is an investment holding company, and its subsidiaries are primarily engaged in property management services, value-added services, pre-delivery and consulting services, and property engineering services. - The Company was **incorporated in the Cayman Islands on December 13, 2018**, and its shares are **listed on the Main Board of the Hong Kong Stock Exchange**[110](index=110&type=chunk) - The Company's subsidiaries are primarily engaged in **property management services, value-added services, pre-delivery and consulting services, and property engineering services**[112](index=112&type=chunk) - The Company's ultimate controlling company is **Xinyuan Real Estate Holdings Co., Ltd.**, whose shares are **listed on the New York Stock Exchange**[111](index=111&type=chunk) [2.1 Basis of Preparation](index=41&type=section&id=2.1%20Basis%20of%20Preparation) The interim condensed consolidated financial statements are prepared in accordance with the applicable disclosure requirements of the HKEX Listing Rules and International Accounting Standard 34, with accounting policies consistent with the 2024 annual consolidated financial statements, and the presentation currency is RMB. - The interim condensed consolidated financial statements are prepared in accordance with the **applicable disclosure requirements of the HKEX Listing Rules** and **International Accounting Standard 34 Interim Financial Reporting**[113](index=113&type=chunk) - The accounting policies and methods of computation adopted are **consistent with those applied in the preparation of the Group's annual consolidated financial statements for the year ended December 31, 2024**[115](index=115&type=chunk) - **RMB** is used as the presentation currency for the interim condensed consolidated financial information[114](index=114&type=chunk) [2.2 Changes in Accounting Policies and Disclosures](index=42&type=section&id=2.2%20Changes%20in%20Accounting%20Policies%20and%20Disclosures) During the period, new or amended standards such as IFRS 16 (amended), IAS 7 and IFRS 7 (amended), and IAS 1 (amended) were adopted for the first time, with no significant financial impact on the Group's interim condensed consolidated financial statements. - New or amended standards adopted for the first time during the period include **IFRS 16 (amended) Lease Liability in a Sale and Leaseback, IAS 7 and IFRS 7 (amended) Supplier Finance Arrangements, and IAS 1 (amended) Classification of Liabilities as Current or Non-current and Non-current Liabilities with Covenants**[115](index=115&type=chunk) - The adoption of these new or amended IFRSs had **no significant financial impact** on the Group's interim condensed consolidated financial statements and/or disclosures contained therein[115](index=115&type=chunk) [2.3 International Financial Reporting Standards Issued But Not Yet Effective](index=42&type=section&id=2.3%20International%20Financial%20Reporting%20Standards%20Issued%20But%20Not%20Yet%20Effective) The Group has not adopted any other new or amended International Financial Reporting Standards that have been issued but are not yet effective for this interim period, and directors believe their adoption is unlikely to have a significant financial impact. - The Group has **not adopted any other new or amended International Financial Reporting Standards** that have been issued but are not yet effective for this interim period[116](index=116&type=chunk) - The Company's directors believe that the adoption of these standards is **unlikely to have a significant financial impact** on these interim condensed consolidated financial statements[116](index=116&type=chunk) [3. Operating Segment Information](index=43&type=section&id=3.%20Operating%20Segment%20Information) Management reviews the operating results of the business as a single operating segment to make decisions about resource allocation, thus the Company's chief operating decision-maker considers there to be only one segment for strategic decision-making. - Management reviews the operating results of the business as a **single operating segment** to make decisions on resource allocation[117](index=117&type=chunk) - All of the Group's **revenue and non-current assets are derived from China**[117](index=117&type=chunk) [4. Revenue](index=43&type=section&id=4.%20Revenue) The Group's revenue primarily derives from property management services, value-added services, pre-delivery and consulting services, and property engineering services. For the six months ended June 30, 2025, total revenue was RMB 450.0 million. Revenue by Service Type | Service Type | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Property Management Services | 315,295 | 278,610 | | Value-Added Services | 102,660 | 83,051 | | Pre-delivery and Consulting Services | 2,909 | 6,991 | | Property Engineering Services | 29,152 | 36,757 | | Total | 450,016 | 405,409 | - For the six months ended **June 30, 2025**, revenue from entities controlled by the ultimate controlling company was **RMB 17,258,000**, accounting for **4% of the Group's total revenue**[119](index=119&type=chunk) Recognized Revenue Related to Contract Liabilities Carried Forward | Indicator | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Revenue recognized included in the balance of contract liabilities at the beginning of the reporting period | 144,489 | 106,502 | [5. Other Income, Gains and Losses, Net](index=45&type=section&id=5.%20Other%20Income%2C%20Gains%20and%20Losses%2C%20Net) For the six months ended June 30, 2025, other income, gains and losses, net, was a negative RMB 1.039 million, a significant decrease from RMB 32.753 million in the prior period, primarily due to lower interest income and the absence of recovery of interest income from pledged matters. Other Income, Gains and Losses, Net Breakdown | Item | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Recovery of interest income loss from pledged matters | – | 24,438 | | Net loss from partial settlement of other receivables related to pledged matters | – | (6,489) | | Bank interest income | 525 | 678 | | Government grants | 55 | 210 | | Exchange differences, net | (1,180) | (178) | | Write-off of bad debts from related party payments | (1,362) | – | | Others | 923 | 14,094 | | Total | (1,039) | 32,753 | - The decrease was primarily attributable to **lower interest income in the current period**, and the **recovery of interest income loss from pledged matters in the corresponding period of 2024**[122](index=122&type=chunk) [6. Profit Before Income Tax](index=46&type=section&id=6.%20Profit%20Before%20Income%20Tax) For the six months ended June 30, 2025, profit before income tax was RMB 74.881 million. Key costs included cost of services provided of RMB 294.573 million and employee benefit expenses of RMB 120.496 million. Profit Before Income Tax Components | Item | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Cost of services provided | 294,573 | 273,182 | | Employee benefit expenses | 120,496 | 117,131 | | Total depreciation and amortization | 12,837 | 6,674 | | Of which: Depreciation of right-of-use assets | 7,821 | 2,156 | | Impairment provisions for financial assets and contract assets (excluding related parties) | 31,555 | 65,373 | | Impairment reversals for financial assets and contract assets (related parties), net | (19,125) | (30,414) | [7. Income Tax Expense](index=48&type=section&id=7.%20Income%20Tax%20Expense) For the six months ended June 30, 2025, total tax expense for the period was RMB 13.954 million, a decrease from the prior period. China's corporate income tax rate is 25%, with some Chinese entities enjoying reduced rates as small low-profit enterprises. Income Tax Expense Breakdown | Item | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Current income tax – China | 23,165 | 31,408 | | Deferred income tax – China | (9,211) | (9,925) | | Total tax expense for the period | 13,954 | 21,483 | - The Company is **exempt from Cayman Islands income tax** under the Cayman Islands Companies Act[126](index=126&type=chunk) - The Group's Chinese entities are subject to **Corporate Income Tax at a rate of 25%** on their assessable income, with small low-profit enterprises enjoying reduced tax rates[129](index=129&type=chunk) [8. Dividends](index=49&type=section&id=8.%20Dividends) The Board recommends an interim dividend of 2.77 HK cents per ordinary share for the six months ended June 30, 2025, totaling approximately HKD 16.427 million (approximately RMB 14.990 million). - On **August 28, 2025**, the Board recommended an interim dividend of **2.77 HK cents per ordinary share** for the six months ended June 30, 2025, totaling approximately **HKD 16,427,000 (equivalent to RMB 14,990,000)**[130](index=130&type=chunk) - On **June 8, 2025**, the Board recommended a final dividend of **2.73 HK cents per ordinary share** for the year ended December 31, 2024, totaling approximately **HKD 16,190,000 (equivalent to RMB 14,764,000)**, which was paid in July 2025[130](index=130&type=chunk) [9. Earnings Per Share Attributable to Equity Holders of the Company](index=49&type=section&id=9.%20Earnings%20Per%20Share%20Attributable%20to%20Equity%20Holders%20of%20the%20Company) For the six months ended June 30, 2025, basic earnings per share were RMB 10.29 cents, an increase from RMB 8.96 cents in the prior period. Earnings Per Share | Indicator | 2025 H1 (RMB cents) | 2024 H1 (RMB cents) | | :--- | :--- | :--- | | Basic Earnings Per Share | 10.29 | 8.96 | | Diluted Earnings Per Share | 10.29 | 8.96 | - Basic earnings per share are calculated by dividing the **profit for the period attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period (577,268,400 shares)**[131](index=131&type=chunk) - There was **no difference between basic and diluted earnings per share** as there were no potentially dilutive ordinary shares outstanding during the period[131](index=131&type=chunk) [10. Leases](index=50&type=section&id=10.%20Leases) The Group has lease contracts for its offices in China and Hong Kong, with lease terms ranging from 2 to 15 years. As of June 30, 2025, the carrying value of right-of-use assets was RMB 31.225 million, and lease liabilities were RMB 34.841 million. - The Group has lease contracts for its **offices in China and Hong Kong** used for its operations, with lease terms ranging from **2 to 15 years**[132](index=132&type=chunk) Carrying Value of Right-of-Use Assets | Indicator | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Carrying Value of Right-of-Use Assets | 31,225 | 38,692 | Carrying Value of Lease Liabilities | Indicator | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Carrying Value of Lease Liabilities | 34,841 | 47,050 | | Of which: Current portion | 13,519 | 14,269 | | Of which: Non-current portion | 21,322 | 32,781 | Lease Amounts Recognized in Profit or Loss | Item | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Interest on lease liabilities | 858 | 189 | | Depreciation expense of right-of-use assets | 7,821 | 2,156 | | Expenses relating to short-term leases | 201 | 8,071 | | Total recognized in profit or loss | 8,880 | 10,416 | [11. Intangible Assets](index=53&type=section&id=11.%20Intangible%20Assets) As of June 30, 2025, the net carrying value of intangible assets was RMB 36.270 million, primarily comprising property operating rights and computer software. Net Carrying Value of Intangible Assets | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Operating Rights – Premises | 34,125 | 36,075 | | Computer Software | 2,145 | 2,854 | | Total | 36,270 | 38,929 | - Intangible assets represent **property operating rights** arising from the acquisition of a subsidiary due to a partial settlement of an arbitration award on **April 1, 2024** from the ultimate controlling company[138](index=138&type=chunk) - These property operating rights have a **finite useful life** and are amortized on a **straight-line basis over 10 years**[138](index=138&type=chunk) [12. Investment Properties](index=54&type=section&id=12.%20Investment%20Properties) As of June 30, 2025, the carrying value of investment properties was RMB 70.052 million, an increase from RMB 49.574 million as of December 31, 2024. Carrying Value of Investment Properties | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Leased Parking Spaces – Right-of-Use Assets | 9,581 | 9,827 | | Leased Clubhouses – Right-of-Use Assets | 39,062 | 39,747 | | Duplex Villas, Residential and Commercial Properties | 21,409 | – | | Total | 70,052 | 49,574 | - On **May 19, 2025**, the Group entered into debt offset agreements with subsidiaries and associates of the ultimate controlling company, acquiring **certain duplex villas, residential and commercial properties, parking spaces, and storage rooms**[142](index=142&type=chunk) - The Group owns **547 leased parking spaces (20-year lease term)** and **six leased clubhouses (30-year lease term)**[143](index=143&type=chunk) [13. Trade and Bills Receivables](index=57&type=section&id=13.%20Trade%20and%20Bills%20Receivables) As of June 30, 2025, total trade and bills receivables amounted to RMB 361.790 million, an 11.4% increase from December 31, 2024. Trade and Bills Receivables Breakdown | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Trade receivables – Related parties | 214,149 | 235,973 | | Trade receivables – Third parties | 353,883 | 267,790 | | Less: Impairment provision for trade receivables | (207,417) | (180,497) | | Bills receivables | 1,175 | 1,560 | | Total | 361,790 | 324,826 | - Trade receivables for property management services are collected **monthly or quarterly**, typically due upon issuance of payment notices, with **no credit period**[144](index=144&type=chunk) Aging Analysis of Trade Receivables (net of impairment) | Aging | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Within 1 year | 152,279 | 151,493 | | 1 to 2 years | 78,749 | 90,305 | | 2 to 3 years | 59,726 | 51,196 | | 3 to 4 years | 39,615 | 31,832 | | 4 to 5 years | 31,421 | – | | Total | 361,790 | 324,826 | [14. Prepayments to a Related Party, Payments to Related Parties, Deposits, Prepayments and Other Receivables](index=59&type=section&id=14.%20Prepayments%20to%20a%20Related%20Party%2C%20Payments%20to%20Related%20Parties%2C%20Deposits%2C%20Prepayments%20and%20Other%20Receivables) As of June 30, 2025, non-current prepayments were RMB 47.336 million, and current payments (related parties) were RMB 97.634 million. Other receivables totaled RMB 382.038 million, including RMB 302.714 million related to pledged matters. Prepayments and Other Receivables Breakdown | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Non-current prepayments – Related parties (net of impairment) | 47,336 | 47,336 | | Current payments – Related parties (net of impairment) | 97,634 | 99,297 | | Current prepayments | 5,166 | 26,343 | | Deposits (net of impairment) | 23,054 | 18,037 | | Other receivables – Related parties | 60,179 | 66,137 | | Other receivables – Related parties – Related to pledged matters | 302,714 | 302,714 | | Other receivables – Third parties | 19,145 | 7,320 | | Less: Impairment provision for other receivables | (211,693) | (205,250) | | Total (current portion) | 239,913 | 249,630 | - Non-current prepayments represent prepayments for the purchase of **342 units in Xinyuan Mingcheng, a property development project in Henan Province**, with an impairment provision of **RMB 41,737,000**[148](index=148&type=chunk)[149](index=149&type=chunk) - Current payments primarily represent amounts paid to certain subsidiaries of the ultimate controlling company for **exclusive sales rights of parking spaces**, with a provision of **RMB 93,939,000**[149](index=149&type=chunk)[152](index=152&type=chunk) - Receivables related to pledged matters primarily represent **unauthorized pledged bank deposits previously obtained by the borrower for bank borrowings**, with a provision of approximately **RMB 153,884,000**[155](index=155&type=chunk)[156](index=156&type=chunk) [15. Trade Payables](index=63&type=section&id=15.%20Trade%20Payables) As of June 30, 2025, total trade payables were RMB 121.578 million, a 16.1% decrease from December 31, 2024. Trade payables are interest-free, with a general credit period of 30 to 90 days. Trade Payables Breakdown | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Trade payables – Related parties | 83,394 | 30,066 | | Trade payables – Third parties | 38,184 | 114,897 | | Total | 121,578 | 144,963 | - Trade payables are **interest-free**, and the general credit period is **30 to 90 days**[157](index=157&type=chunk) Aging Analysis of Trade Payables | Aging | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Within 1 year | 55,286 | 73,593 | | 1 to 2 years | 28,342 | 58,553 | | 2 to 3 years | 26,956 | 4,269 | | Over 3 years | 10,994 | 8,548 | | Total | 121,578 | 144,963 | [16. Other Payables and Accrued Expenses and Contract Liabilities](index=64&type=section&id=16.%20Other%20Payables%20and%20Accrued%20Expenses%20and%20Contract%20Liabilities) As of June 30, 2025, total other payables and accrued expenses were RMB 232.880 million, and total contract liabilities were RMB 131.766 million. Other Payables and Accrued Expenses and Contract Liabilities Breakdown | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Other payables and accrued expenses – Related parties | 61,156 | 42,294 | | Other payables and accrued expenses – Deposits and temporary receipts from third parties | 54,489 | 131,984 | | Other payables and accrued expenses – Others | 58,937 | 27,746 | | Dividends payable | 14,804 | 40 | | Accrued staff costs | 29,351 | 48,146 | | Other taxes payable | 14,143 | 13,969 | | Contract liabilities – Related parties | 27 | 54 | | Contract liabilities – Third parties | 131,739 | 144,435 | | Total (Other Payables and Accrued Expenses) | 232,880 | 264,179 | | Total (Contract Liabilities) | 131,766 | 144,489 | [17. Related Party Transactions](index=64&type=section&id=17.%20Related%20Party%20Transactions) The Group engages in various related party transactions with its ultimate controlling company and its subsidiaries, including revenue from property management services, value-added services, pre-delivery and consulting services, property engineering services, and costs for commercial asset entrusted operation services. - As of **June 30, 2025**, the ultimate controlling company held approximately **43.07% of the Company's equity**[160](index=160&type=chunk) Significant Transactions with Related Parties | Transaction Type | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Property management service fee income | 1,076 | 2,952 | | Value-added service fee income | 2,360 | 2,445 | | Value-added service fees (cinema leasing services) | 1,114 | – | | Cost of services (commercial asset entrusted operation services) | 7,946 | – | | Recovery of interest income loss from pledged matters | – | 24,438 | | Pre-delivery and consulting service fee income | 1,152 | 4,819 | | Property engineering service income | 11,556 | 18,667 | - The aforementioned related party transactions also constitute **continuing connected transactions** as defined in Chapter 14A of the Listing Rules[164](index=164&type=chunk) Key Management Personnel Compensation | Item | 2025 H1 (thousand RMB) | 2024 H1 (thousand RMB) | | :--- | :--- | :--- | | Salaries, allowances and benefits | 2,998 | 4,028 | | Pension scheme contributions | 146 | 163 | | Total | 3,144 | 4,191 | Balances with Related Parties (net of impairment) | Item | June 30, 2025 (thousand RMB) | Dec 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Trade receivables from related parties | 124,738 | 133,388 | | Contract assets from related parties | 32,904 | 45,199 | | Other receivables from related parties (incl. payments to related parties and pledged matters related) | 297,062 | 300,977 | | Prepayments to related parties (non-current) | 47,336 | 47,336 | | Prepayments to related parties (current) | 1,992 | 12,617 | | Trade payables to related parties | 83,394 | 30,066 | | Other payables to related parties | 61,156 | 42,294 | | Contract liabilities from related parties | 27 | 54 | [18. Fair Value and Fair Value Hierarchy o

Related Party Transactions - For the fiscal year ending December 31, 2024, the company reported related party transactions amounting to HKD 4,434,000 with intermediary holding companies, an increase of 25% from HKD 3,547,000 in 2023[5] - The company incurred related party transactions of HKD 205,000 with subsidiaries, a decrease of 30% from HKD 295,000 in 2023[5] - Related party transactions with associated companies totaled HKD 7,654,000, up 12% from HKD 6,824,000 in 2023[5] - The company confirmed that all related party transactions comply with the applicable provisions of the listing rules[8] Administrative and Sales-Related Expenses - The company recognized administrative expenses of approximately HKD 4,540,000 paid by intermediary holding companies, a slight decrease from HKD 4,613,000 in 2023[5] - The total sales-related expenses paid by the group to intermediary holding companies and/or subsidiaries amounted to approximately HKD 2,800,000 for the fiscal year, qualifying for full exemption under listing rules[6] - The company sold brewing materials to its subsidiaries for approximately HKD 53,000, which also qualifies for full exemption under listing rules[6]

股份代號: 1398 中國工商銀行股份有限公司 (於中華人民共和國註冊成立的股份有限公司) 中期報告 2025 公司簡介 中國工商銀行成立於1984年1月1日。2005年10月28日， 本行整體改制為股份有限公司。2006年10月27日，本行成功 在上交所和香港聯交所同日掛牌上市。 本行致力於建設中國特色世界一流現代金融機構，擁有 優質的客戶基礎、多元的業務結構、強勁的創新能力和市場競 爭力。本行將服務作為立行之本，堅持以服務創造價值，向全 球超1,400萬對公客戶和超7.7億個人客戶提供豐富的金融產品 和優質的金融服務，以自身高質量發展服務經濟社會高質量發 展。本行自覺將社會責任融入發展戰略和經營管理活動，在服 務製造業、發展普惠金融、支持鄉村振興、發展綠色金融、支 持公益事業等方面受到廣泛讚譽。 本行始終聚焦主業，堅持服務實體經濟的本源，與實體經 濟共榮共存、共擔風雨、共同成長；始終堅持風險為本，牢牢 守住底線，不斷提高控制和化解風險的能力；始終堅持對商業 銀行經營規律的把握與遵循，致力於成為基業長青的銀行；始 終堅持穩中求進、創新求進，持續深化重點發展戰略，積極發 展金融科技，加快數字化轉型；始終堅持專 ...

CONTENTS 目 錄 | Financial Highlights | 財務摘要 | 2 | | --- | --- | --- | | Corporate Information | 公司資料 | 3 | | Business Overview | 業務概覽 | 6 | | Disclosure of Interests | 權益披露 | 20 | | Corporate Governance and Other Information | 企業管治及其他資料 | 24 | | Condensed Consolidated Statement of | 簡明合併損益表 | 28 | | Profit or Loss | | | | Condensed Consolidated Statement of Profit | 簡明合併損益及 | 29 | | or Loss and Other Comprehensive Income | 其他全面收益表 | | | Condensed Consolidated Statement of | 簡明合併財務狀況表 | 30 | | Financial Posit ...

[Corporate Information](index=3&type=section&id=Corporate%20Information) This section details the company's governance structure, key personnel, registered offices, share information, and advisors [Board of Directors](index=3&type=section&id=Board%20of%20Directors) The Board of Directors includes non-executive, executive, and independent non-executive directors, with Mr. Tang Chengyong resigning as President on March 27, 2025 - Mr. Huang Ruoqing serves as non-executive director and chairman[4](index=4&type=chunk) - Mr. Tang Chengyong resigned as President on March 27, 2025, but remains an executive director[4](index=4&type=chunk) [Committees](index=3&type=section&id=Committees) The composition and chairpersons of the Audit, Remuneration, and Nomination Committees are disclosed, with a change in the Nomination Committee chairman on June 20, 2025 - The Audit Committee is chaired by Mr. Zhou Mingsheng[4](index=4&type=chunk) - The Remuneration Committee is chaired by Mr. Liu Yuliang[4](index=4&type=chunk) - The Nomination Committee chairman changed from Mr. Huang Ruoqing to Mr. Shi Ronghuai on June 20, 2025, with Ms. Huang Yanwen appointed as a member on the same day[5](index=5&type=chunk) [Key Personnel and Advisors](index=4&type=section&id=Key%20Personnel%20and%20Advisors) The company secretary and authorized representative is Mr. Chen Yuxuan, with Yongtuo Fuxin Certified Public Accountants Co., Ltd. as auditor and Sidley Austin as legal counsel - Mr. Chen Yuxuan serves as company secretary and authorized representative[7](index=7&type=chunk) - The auditor is Yongtuo Fuxin Certified Public Accountants Co., Ltd[7](index=7&type=chunk) - Legal advisors include Sidley Austin (Hong Kong law) and Conyers Dill & Pearman (Cayman Islands law)[7](index=7&type=chunk) [Registered and Business Offices](index=4&type=section&id=Registered%20and%20Business%20Offices) The company's registered office is in the Cayman Islands, its China headquarters in Shenzhen, and its principal place of business in Hong Kong is in Kowloon Bay - The registered office is located in the Cayman Islands[7](index=7&type=chunk) - The China headquarters and principal place of business are located on the 14th floor, Ligao Building, Block 5, Phase I, Qiaochengfang, No. 4080 Qiaoxiang Road, Nanshan District, Shenzhen[9](index=9&type=chunk) - The principal place of business in Hong Kong is Unit 2001-2, Enterprise Square 3, 39 Wang Chiu Road, Kowloon Bay, Kowloon[9](index=9&type=chunk) [Share Registrars and Banks](index=5&type=section&id=Share%20Registrars%20and%20Banks) The principal share registrar is Conyers Trust Company (Cayman) Limited, with Hong Kong Registrars Limited as the Hong Kong share registrar, and major banks including Bank of China - The principal share registrar is Conyers Trust Company (Cayman) Limited[9](index=9&type=chunk) - The Hong Kong share registrar is Hong Kong Central Securities Registrars Limited[10](index=10&type=chunk) - Major bankers include Bank of China Limited, Bank of China (Hong Kong) Limited, The Bank of East Asia, Limited, Hang Seng Bank Limited, and China Merchants Bank Co., Ltd[12](index=12&type=chunk) [Stock Code and Website](index=6&type=section&id=Stock%20Code%20and%20Website) The company's stock code is 2370, and its official website is www.redcohealthy.com - The stock code is **2370**[12](index=12&type=chunk) - The company website is www.redcohealthy.com[12](index=12&type=chunk) [Financial Highlights](index=7&type=section&id=Financial%20Highlights) For the six months ended June 30, 2025, the Group's revenue decreased by 1.5% to RMB 209 million, turning from profit to a loss of RMB 0.8 million, with basic and diluted loss per share of RMB 2.87 cents Financial Highlights for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 209,005 | 212,119 | (1.5%) | | Gross Profit | 52,244 | 57,179 | (8.6%) | | Gross Profit Margin | 25.0% | 27.0% | (7.4%) | | (Loss)/Profit for the Period | (804) | 7,723 | (174.9%) | | (Loss)/Profit Attributable to Owners of the Company | (5,742) | 1,073 | (635.1%) | | (Loss)/Earnings Per Share (RMB cents) | (2.87) | 0.54 | (631.5%) | | **Balance Sheet (Period End):** | | | | | Total Assets | 598,747 | 591,943 | 1.2% | | Total Liabilities | 302,162 | 287,394 | 5.1% | | Total Equity | 296,585 | 304,099 | (2.5%) | [Management Discussion and Analysis](index=8&type=section&id=Management%20Discussion%20and%20Analysis) This chapter elaborates on the company's operating environment, business performance, financial position, and future outlook for the first half of 2025, highlighting industry transformation, declining revenue and profit, and strategic adjustments towards smart city living services [Market Review](index=8&type=section&id=Market%20Review) In the first half of 2025, the property management industry faced unprecedented market changes, requiring integration into grassroots governance and addressing evolving customer demands for comprehensive living experiences, driven by smart technology - The property management industry is undergoing market transformation, needing to reconcile high government requirements with industry realities and integrate into grassroots governance networks[15](index=15&type=chunk)[18](index=18&type=chunk) - Industry consolidation is accelerating, with leading enterprises expanding through mergers and acquisitions, while small and medium-sized enterprises seek differentiated survival[16](index=16&type=chunk)[18](index=18&type=chunk) - Customer demand is shifting from basic services to high-quality, personalized, and convenient comprehensive living experiences[16](index=16&type=chunk)[18](index=18&type=chunk) - Smart technologies (e.g., AI, smart customer service, intelligent robots, low-carbon new energy technologies) play a crucial role in property management, with data-driven refined management becoming an industry foundation[17](index=17&type=chunk)[19](index=19&type=chunk) [Business Review](index=9&type=section&id=Business%20Review) As a leading property management service provider in Jiangxi Province, the Group's revenue for the first half of 2025 was approximately RMB 209 million, a 1.5% year-on-year decrease, resulting in a net loss of approximately RMB 0.8 million compared to a net profit of RMB 7.7 million in the prior year - The Group's revenue for the first half of 2025 was approximately **RMB 209.0 million**, a year-on-year decrease of **1.5%**[22](index=22&type=chunk)[25](index=25&type=chunk) - A net loss of approximately **RMB 0.8 million** was recorded for the period, compared to a net profit of approximately RMB 7.7 million in the same period of 2024[22](index=22&type=chunk)[25](index=25&type=chunk) Changes in GFA Under Management and Contracted GFA | Indicator | June 30, 2025 (million sq.m.) | Prior Period 2024 (million sq.m.) | Change (%) | | :--- | :--- | :--- | :--- | | Total GFA Under Management | 20.7 | 21.6 | (4.3%) | | Total Contracted GFA | 26.8 | 28.2 | (4.9%) | - The Group's ranking among China's Top 100 Property Management Companies rose from 33rd in 2024 to **31st in 2025**[27](index=27&type=chunk)[31](index=31&type=chunk) [Outlook](index=10&type=section&id=Outlook) The Group will solidify its market positioning as a "City Living Service Provider" with a vision to become "China's leading smart city living service provider," implementing a "One Body, Two Wings" industrial structure and "1+2+N" diversified business layout - The Group's market positioning is "City Living Service Provider," with a vision to become "China's leading smart city living service provider"[28](index=28&type=chunk)[32](index=32&type=chunk) - It will build a "One Body, Two Wings" core industrial structure and a "1+2+N" diversified business layout to consolidate competitive advantages in economically developed regions such as the Greater Bay Area, Central China, East China, North China, and the Bohai Rim[28](index=28&type=chunk)[32](index=32&type=chunk) - In the second half of 2025, the Group will leverage its core competencies, integrate emerging technologies and sustainable development trends, and expand project dimensions through internal growth and resource integration to deepen service innovation[29](index=29&type=chunk)[32](index=32&type=chunk) - More resources will be allocated to promote the construction of community elderly care services and develop technology service products covering community value-added services to enhance customer satisfaction, operational efficiency, and build low-carbon, environmentally friendly communities[30](index=30&type=chunk)[32](index=32&type=chunk) [Financial Review](index=11&type=section&id=Financial%20Review) The Group's total revenue for the first half of 2025 decreased by 1.5% year-on-year to RMB 209 million, primarily due to reduced revenue from property management, non-owner value-added, and community value-added services [Revenue by Business Segments](index=11&type=section&id=Revenue%20by%20Business%20Segments) The Group's total revenue decreased by 1.5% year-on-year, mainly due to reduced revenue from property management, non-owner value-added, and community value-added services, partially offset by commercial property sales Revenue by Business Segments (RMB thousands) | Business Segment | 2025 | 2024 | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Property Management Services | 165,978 | 169,230 | (3,252) | (1.9%) | | Non-owner Value-added Services | 16,278 | 18,302 | (2,024) | (11.1%) | | Community Value-added Services | 22,337 | 24,587 | (2,250) | (9.2%) | | Sales of Commercial Properties | 4,412 | — | 4,412 | — | | **Total** | **209,005** | **212,119** | **(3,114)** | **(1.5%)** | - Revenue from property management services decreased by **1.9%**, primarily due to a reduction in GFA under management caused by the ongoing downturn in China's real estate industry[36](index=36&type=chunk)[37](index=37&type=chunk) - Revenue from non-owner value-added services decreased by **11.1%**, mainly due to a reduction in the number of projects delivered by Redco Properties Group, leading to lower sales office management service revenue[38](index=38&type=chunk)[41](index=41&type=chunk) - Revenue from community value-added services decreased by **9.2%**, primarily due to Redco Property's reduced procurement of elderly care service cards, leading to lower community elderly care service revenue[39](index=39&type=chunk)[42](index=42&type=chunk) - Revenue from sales of commercial properties was **RMB 4.4 million**, a new business in the first half of 2025, resulting from the sale of properties obtained under debt settlement agreements[40](index=40&type=chunk)[43](index=43&type=chunk) [Cost of Sales](index=13&type=section&id=Cost%20of%20Sales) Cost of services increased by 1.2% year-on-year to RMB 156.8 million, mainly due to higher repair and maintenance costs for older property management projects and increased replacement costs for aging facilities and equipment - Cost of services increased by **1.2%** from approximately **RMB 154.9 million** in the same period of 2024 to approximately **RMB 156.8 million** in the first half of 2025[45](index=45&type=chunk)[46](index=46&type=chunk) - This was primarily attributable to increased repair and maintenance costs for older property management projects and higher costs for replacing materials and components of aging or obsolete facilities and equipment[45](index=45&type=chunk)[46](index=46&type=chunk) [Gross Profit Margin](index=13&type=section&id=Gross%20Profit%20Margin) The Group's overall gross profit margin decreased from 27.0% in the same period of 2024 to 25.0% in the first half of 2025, primarily affected by declining gross profit margins in property management, non-owner value-added, and community value-added services Gross Profit Margin by Service Type | Service Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Property Management Services | 23.3% | 24.3% | | Non-owner Value-added Services | 34.0% | 36.6% | | Community Value-added Services | 35.2% | 38.1% | | Sales of Commercial Properties | 2.7% | — | | **Overall Gross Profit Margin** | **25.0%** | **27.0%** | - Property management services gross profit margin decreased by **1.0 percentage point**, mainly due to increased outsourcing costs and higher maintenance costs for older property management projects and replacement costs for facility and equipment components[49](index=49&type=chunk)[53](index=53&type=chunk) - Non-owner value-added services gross profit margin decreased by **2.6 percentage points**, primarily due to reduced contribution from sales office management services, which typically have higher gross profit margins[50](index=50&type=chunk)[54](index=54&type=chunk) - Community value-added services gross profit margin decreased by **2.9 percentage points**, primarily due to lower revenue from community elderly care services, which typically have higher gross profit margins[51](index=51&type=chunk)[55](index=55&type=chunk) [Other Income, Gains and Losses, Net](index=14&type=section&id=Other%20Income,%20Gains%20and%20Losses,%20Net) Other income, gains and losses, net, decreased by 55.6% year-on-year to RMB 0.6 million, primarily due to a reduction in government subsidies received - Other income, gains and losses, net, decreased from approximately **RMB 1.3 million** in the same period of 2024 to approximately **RMB 0.6 million** in the first half of 2025[52](index=52&type=chunk)[56](index=56&type=chunk) - This was primarily attributable to a reduction in government subsidies received in the first half of 2025[52](index=52&type=chunk)[56](index=56&type=chunk) [Selling and Marketing Expenses](index=15&type=section&id=Selling%20and%20Marketing%20Expenses) Selling and marketing expenses increased by 30% year-on-year to RMB 1.3 million, mainly due to increased promotional activities and booths to promote elderly care services to property owners - Selling and marketing expenses increased by approximately **30%** from approximately **RMB 1.0 million** in the same period of 2024 to approximately **RMB 1.3 million** in the first half of 2025[57](index=57&type=chunk)[61](index=61&type=chunk) - This was primarily due to increased promotional activities and booths to promote the sale of elderly care services to property owners[57](index=57&type=chunk)[61](index=61&type=chunk) [General and Administrative Expenses](index=15&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses remained relatively stable at approximately RMB 33 million in the first half of 2025 - General and administrative expenses remained relatively stable at approximately **RMB 33 million** in both the first half of 2025 and the same period of 2024[58](index=58&type=chunk)[62](index=62&type=chunk) [Impairment Losses on Financial Assets, Net of Reversal](index=15&type=section&id=Impairment%20Losses%20on%20Financial%20Assets,%20Net%20of%20Reversal) Net impairment losses on financial assets increased by 15.2% to RMB 15.9 million, primarily due to increased impairment provisions for trade receivables from related parties and third parties amid the deteriorating credit risk in China's real estate sector - Net impairment losses on financial assets increased by approximately **15.2%** from approximately **RMB 13.8 million** in the same period of 2024 to approximately **RMB 15.9 million** in the first half of 2025[59](index=59&type=chunk)[63](index=63&type=chunk) - This was primarily due to increased impairment provisions for trade receivables from related parties and third parties, reflecting the deteriorating credit risk and financial conditions in China's real estate industry[59](index=59&type=chunk)[63](index=63&type=chunk) [Finance Income](index=15&type=section&id=Finance%20Income) Finance income decreased by 28.6% year-on-year to RMB 0.5 million, primarily due to reduced interest income from bank deposits - Finance income decreased by approximately **28.6%** from approximately **RMB 0.7 million** in the same period of 2024 to approximately **RMB 0.5 million** in the first half of 2025[60](index=60&type=chunk)[64](index=64&type=chunk) - This was primarily due to reduced interest income from bank deposits[60](index=60&type=chunk)[64](index=64&type=chunk) [Finance Costs](index=16&type=section&id=Finance%20Costs) Finance costs remained stable at approximately RMB 0.5 million in the first half of 2025 - Finance costs remained stable at approximately **RMB 0.5 million** in both the first half of 2025 and the same period of 2024[66](index=66&type=chunk)[71](index=71&type=chunk) [Income Tax Expenses](index=16&type=section&id=Income%20Tax%20Expenses) Income tax expenses decreased by 7.7% year-on-year to RMB 3.6 million, primarily due to a reduction in taxable profit - Income tax expenses decreased by approximately **7.7%** from approximately **RMB 3.9 million** in the same period of 2024 to approximately **RMB 3.6 million** in the first half of 2025[67](index=67&type=chunk)[72](index=72&type=chunk) - This was primarily due to a reduction in taxable profit in the first half of 2025[67](index=67&type=chunk)[72](index=72&type=chunk) [Loss/Profit for the Period](index=16&type=section&id=Loss%2FProfit%20for%20the%20Period) The Group recorded a loss of RMB 0.8 million for the period in the first half of 2025, compared to a profit of RMB 7.7 million in the same period of 2024, with loss attributable to owners of the Company at RMB 5.7 million - The Group recorded a loss of approximately **RMB 0.8 million** for the period, compared to a profit of approximately RMB 7.7 million in the same period of 2024[68](index=68&type=chunk)[73](index=73&type=chunk) - Loss attributable to owners of the Company was approximately **RMB 5.7 million**, compared to a profit of approximately RMB 1.1 million in the same period of 2024[69](index=69&type=chunk)[73](index=73&type=chunk) [Intangible Assets](index=16&type=section&id=Intangible%20Assets) Net intangible assets decreased from approximately RMB 34.8 million as of December 31, 2024, to approximately RMB 32.2 million as of June 30, 2025, primarily due to amortization of customer relationships and computer software - Net intangible assets decreased by approximately **7.5%** from approximately **RMB 34.8 million** as of December 31, 2024, to approximately **RMB 32.2 million** as of June 30, 2025[70](index=70&type=chunk)[74](index=74&type=chunk) - This was primarily due to the amortization of customer relationships and computer software[70](index=70&type=chunk)[74](index=74&type=chunk) [Property, Plant and Equipment](index=17&type=section&id=Property,%20Plant%20and%20Equipment) Net property, plant and equipment increased from approximately RMB 44.9 million as of December 31, 2024, to approximately RMB 46.1 million as of June 30, 2025, primarily due to additions of furniture, office equipment, and leasehold improvements - Net property, plant and equipment increased by approximately **2.7%** from approximately **RMB 44.9 million** as of December 31, 2024, to approximately **RMB 46.1 million** as of June 30, 2025[75](index=75&type=chunk)[80](index=80&type=chunk) - This was primarily due to additions of furniture and office equipment and leasehold improvements[75](index=75&type=chunk)[80](index=80&type=chunk) [Trade and Other Receivables and Prepayments](index=17&type=section&id=Trade%20and%20Other%20Receivables%20and%20Prepayments) Net trade receivables increased from approximately RMB 264.7 million as of December 31, 2024, to approximately RMB 290.2 million as of June 30, 2025, mainly due to slower collection from property owners and related parties amid the downturn in China's real estate market - Net trade receivables increased by approximately **9.6%** from approximately **RMB 264.7 million** as of December 31, 2024, to approximately **RMB 290.2 million** as of June 30, 2025[77](index=77&type=chunk)[81](index=81&type=chunk) - This was primarily due to slower collection from property owners and related parties amid the overall downturn in China's real estate market[77](index=77&type=chunk)[81](index=81&type=chunk) - Net other receivables and prepayments increased by approximately **17.8%** from approximately **RMB 21.3 million** as of December 31, 2024, to approximately **RMB 25.1 million** as of June 30, 2025[78](index=78&type=chunk)[81](index=81&type=chunk) [Trade Payables](index=17&type=section&id=Trade%20Payables) Trade payables increased from approximately RMB 20.7 million as of December 31, 2024, to approximately RMB 33.7 million as of June 30, 2025, primarily due to longer credit terms from suppliers - Trade payables increased by approximately **62.8%** from approximately **RMB 20.7 million** as of December 31, 2024, to approximately **RMB 33.7 million** as of June 30, 2025[79](index=79&type=chunk)[82](index=82&type=chunk) - This was primarily due to longer credit terms from suppliers for outsourcing costs and landscaping and cleaning fees[79](index=79&type=chunk)[82](index=82&type=chunk) [Accruals and Other Payables](index=18&type=section&id=Accruals%20and%20Other%20Payables) Accruals and other payables increased from approximately RMB 77.6 million as of December 31, 2024, to approximately RMB 85.6 million as of June 30, 2025, mainly due to increased collections and payments made on behalf of property owners - Accruals and other payables increased by approximately **10.3%** from approximately **RMB 77.6 million** as of December 31, 2024, to approximately **RMB 85.6 million** as of June 30, 2025[83](index=83&type=chunk)[86](index=86&type=chunk) - This was primarily due to increased collections and payments made on behalf of property owners, such as public utility fees and other taxes payable[83](index=83&type=chunk)[86](index=86&type=chunk) [Contract Liabilities](index=18&type=section&id=Contract%20Liabilities) Contract liabilities decreased from approximately RMB 114.5 million as of December 31, 2024, to approximately RMB 102.2 million as of June 30, 2025, mainly due to the seasonal impact of property owners settling outstanding property management fees at year-end - Contract liabilities decreased by approximately **10.7%** from approximately **RMB 114.5 million** as of December 31, 2024, to approximately **RMB 102.2 million** as of June 30, 2025[84](index=84&type=chunk)[87](index=87&type=chunk) - This was primarily due to the seasonal impact of property owners settling their outstanding property management fee balances at year-end for payment preference and convenience[84](index=84&type=chunk)[87](index=87&type=chunk) [Bank and Other Borrowings](index=18&type=section&id=Bank%20and%20Other%20Borrowings) Bank and other borrowings increased from approximately RMB 12.3 million as of December 31, 2024, to approximately RMB 13.7 million as of June 30, 2025, with an increase in HKD-denominated borrowings and a decrease in the effective interest rate - Bank and other borrowings increased by approximately **11.4%** from approximately **RMB 12.3 million** as of December 31, 2024, to approximately **RMB 13.7 million** as of June 30, 2025[85](index=85&type=chunk)[88](index=88&type=chunk) - HKD-denominated bank borrowings were approximately **HKD 10.9 million** (December 31, 2024: HKD 9.3 million), and RMB-denominated bank and other borrowings were approximately **RMB 3.7 million** (December 31, 2024: RMB 3.7 million)[85](index=85&type=chunk)[88](index=88&type=chunk) - The effective interest rate for RMB-denominated borrowings decreased from **5.24%** as of December 31, 2024, to **4.35%** as of June 30, 2025[85](index=85&type=chunk)[88](index=88&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=19&type=section&id=Liquidity,%20Financial%20Resources%20and%20Capital%20Structure) As of June 30, 2025, the Group's cash and cash equivalents decreased to approximately RMB 122.3 million, with a slight decline in net current assets and current ratio, and a slight increase in the gearing ratio, while maintaining a sound overall financial position - Cash and cash equivalents decreased by approximately **11.1%** from approximately **RMB 137.5 million** as of December 31, 2024, to approximately **RMB 122.3 million** as of June 30, 2025[89](index=89&type=chunk)[94](index=94&type=chunk) - Net current assets decreased by approximately **5.0%** from approximately **RMB 188.7 million** as of December 31, 2024, to approximately **RMB 179.2 million** as of June 30, 2025[90](index=90&type=chunk)[94](index=94&type=chunk) Liquidity Indicators | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current Ratio | 1.6 times | 1.7 times | | Gearing Ratio | 4.6% | 4.1% | [Capital Commitments](index=19&type=section&id=Capital%20Commitments) As of June 30, 2025, the Group had no significant capital commitments - As of June 30, 2025, the Group had no significant capital commitments (December 31, 2024: nil)[91](index=91&type=chunk)[95](index=95&type=chunk) [Contingent Liabilities](index=19&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities (December 31, 2024: nil)[92](index=92&type=chunk)[96](index=96&type=chunk) [Pledge of Assets](index=19&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, the Group's bank borrowings were secured by certain properties with a carrying amount of approximately RMB 26.0 million and guaranteed by the Company - As of June 30, 2025, the Group's bank borrowings were secured by certain properties with a carrying amount of approximately **RMB 26.0 million** (December 31, 2024: RMB 26.9 million) and guaranteed by the Company[93](index=93&type=chunk)[97](index=97&type=chunk) [Foreign Exchange Risk](index=20&type=section&id=Foreign%20Exchange%20Risk) The Group's operations are primarily conducted in China in RMB, with the main foreign exchange source being HKD-denominated net proceeds from listing, and directors do not anticipate significant adverse effects from RMB exchange rate fluctuations - Almost all of the Group's operating activities are conducted in China, with most transactions denominated in RMB[98](index=98&type=chunk)[103](index=103&type=chunk) - The main source of foreign exchange is the net proceeds from the listing, denominated in HKD[98](index=98&type=chunk)[103](index=103&type=chunk) - The Directors do not expect RMB exchange rate fluctuations to have a significant adverse impact on the Group's operations, and as of June 30, 2025, the Group had not engaged in any hedging activities[98](index=98&type=chunk)[103](index=103&type=chunk) [Interest Rate Risk](index=20&type=section&id=Interest%20Rate%20Risk) Except for bank balances and borrowings bearing floating interest rates, the Group was not directly exposed to significant risks related to market interest rate changes as of June 30, 2025 - Except for bank balances and bank and other borrowings bearing floating interest rates, the Group was not directly exposed to significant risks related to market interest rate changes as of June 30, 2025[99](index=99&type=chunk)[104](index=104&type=chunk) [Significant Investments Held](index=20&type=section&id=Significant%20Investments%20Held) As of June 30, 2025, the Group held no significant investments - As of June 30, 2025, the Group held no significant investments[100](index=100&type=chunk)[105](index=105&type=chunk) [Material Acquisitions and Disposals](index=20&type=section&id=Material%20Acquisitions%20and%20Disposals) For the six months ended June 30, 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures[101](index=101&type=chunk)[106](index=106&type=chunk) [Future Plans for Material Investments or Capital Assets](index=20&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of June 30, 2025, the Group had no other future plans for material investments or capital assets, except for changes in the use of IPO proceeds disclosed in the prospectus and related announcements - As of June 30, 2025, the Group had no other future plans for material investments or capital assets, except for changes in the use of proceeds from the initial public offering as disclosed in the prospectus and related announcements[102](index=102&type=chunk)[107](index=107&type=chunk) [Employees and Remuneration Policy](index=21&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had 1,691 full-time employees, a 15% decrease from the prior year, with total staff costs of approximately RMB 73.5 million, and remuneration policies based on position, performance, company profitability, industry standards, and market conditions - As of June 30, 2025, the Group had **1,691** full-time employees, a **15%** decrease from **1,990** in the same period of 2024[108](index=108&type=chunk)[110](index=110&type=chunk) - Total staff costs for the six months ended June 30, 2025, were approximately **RMB 73.5 million** (same period of 2024: RMB 84.1 million)[108](index=108&type=chunk)[110](index=110&type=chunk) - Employee remuneration packages, including salaries, performance bonuses, and other benefits, are determined based on the Group's remuneration and benefits policy, employee position, performance, company profitability, industry standards, and market conditions[108](index=108&type=chunk)[110](index=110&type=chunk) [Events After the End of the Reporting Period](index=21&type=section&id=Events%20After%20the%20End%20of%20the%20Reporting%20Period) As of the date of this report, no disclosable events have occurred after June 30, 2025, that could significantly impact the Group's operations and financial results - No disclosable events that could significantly impact the Group's operations and financial results have occurred after June 30, 2025, and up to the date of this report[109](index=109&type=chunk)[111](index=111&type=chunk) [Corporate Governance and Other Information](index=22&type=section&id=Corporate%20Governance%20and%20Other%20Information) This chapter outlines the company's corporate governance practices, disclosure of directors' and major shareholders' interests, and changes in the use of net proceeds from the global offering, demonstrating a commitment to high governance standards and adaptive capital allocation [Corporate Governance Practices](index=22&type=section&id=Corporate%20Governance%20Practices) The Group is committed to maintaining high standards of corporate governance, having adopted the Corporate Governance Code in Appendix C1 of the Listing Rules and complied with all applicable code provisions in the first half of 2025 - The Company has adopted the Corporate Governance Code set out in Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited as its own corporate governance code[112](index=112&type=chunk)[116](index=116&type=chunk) - For the six months ended June 30, 2025, the Company has applied the principles of good corporate governance and complied with all applicable code provisions set out in Part 2 of the Corporate Governance Code[113](index=113&type=chunk)[116](index=116&type=chunk) [Model Code for Securities Transactions](index=22&type=section&id=Model%20Code%20for%20Securities%20Transactions) The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers in Appendix C3 of the Listing Rules, and all directors confirmed compliance for the first half of 2025 - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix C3 to the Listing Rules as its own code of conduct for directors' securities transactions[114](index=114&type=chunk)[117](index=117&type=chunk) - Following specific enquiries made to all Directors, the Directors have confirmed that they have complied with the required standards of dealing set out in the Model Code throughout the six months ended June 30, 2025[114](index=114&type=chunk)[117](index=117&type=chunk) [Interim Dividend](index=22&type=section&id=Interim%20Dividend) The Board of Directors has resolved not to declare any interim dividend for the six months ended June 30, 2025 - The Board has resolved not to declare any interim dividend for the six months ended June 30, 2025 (same period of 2024: nil)[115](index=115&type=chunk)[118](index=118&type=chunk) [Audit Committee](index=23&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors, has reviewed the Group's accounting principles and practices and discussed financial reporting matters, including the unaudited condensed interim consolidated financial information - The Audit Committee comprises three independent non-executive directors, namely Mr. Zhou Mingsheng (Chairman), Mr. Shi Ronghuai, and Mr. Liu Yuliang[120](index=120&type=chunk)[123](index=123&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and discussed financial reporting matters with the Company's management, including the unaudited condensed interim consolidated financial information for the six months ended June 30, 2025[120](index=120&type=chunk)[123](index=123&type=chunk) [Changes to Directors' Information](index=23&type=section&id=Changes%20to%20Directors'%20Information) Mr. Zhou Mingsheng resigned as an independent non-executive director of Teamway International Group Holdings Limited on August 31, 2025, with no other disclosable information confirmed by directors - On August 31, 2025, Mr. Zhou Mingsheng resigned as an independent non-executive director of Teamway International Group Holdings Limited[121](index=121&type=chunk)[124](index=124&type=chunk) [Purchase, Sale, or Redemption of Listed Securities of the Company](index=23&type=section&id=Purchase,%20Sale,%20or%20Redemption%20of%20Listed%20Securities%20of%20the%20Company) For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities, and the Company held no treasury shares - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities (including the sale of treasury shares)[122](index=122&type=chunk)[125](index=125&type=chunk) - As of June 30, 2025, the Company held no treasury shares[122](index=122&type=chunk)[125](index=125&type=chunk) [Use of Net Proceeds from the Global Offering](index=24&type=section&id=Use%20of%20Net%20Proceeds%20from%20the%20Global%20Offering) On June 26, 2025, the Company resolved to change the use of unutilized net proceeds from the global offering to seek strategic investments, upgrade IT, enhance concierge services, expand community elderly care services, and allocate funds for general business purposes and working capital to increase financial management flexibility - The Company was listed on March 31, 2022, with net proceeds from the global offering of approximately **HKD 155.6 million**[126](index=126&type=chunk)[127](index=127&type=chunk) - On June 26, 2025, the Board resolved to change the use of the unutilized net proceeds, including: [128](index=128&type=chunk) - Adjusting and allocating **10%** of the net proceeds (approximately **15.3%** of the unutilized net proceeds) to seek selective strategic investment and acquisition opportunities and expand the scope of investment targets[128](index=128&type=chunk)[133](index=133&type=chunk) - Adjusting and allocating **20%** of the net proceeds (approximately **14.2%** of the unutilized net proceeds) to upgrade information technology infrastructure and enhance smart community management[128](index=128&type=chunk)[133](index=133&type=chunk) - Continuing to allocate **10%** of the net proceeds (**2.0%** of the unutilized net proceeds) to enhance the Group's concierge services[128](index=128&type=chunk)[133](index=133&type=chunk) - Adjusting and allocating **40%** of the net proceeds (representing **50.3%** of the unutilized net proceeds) to enhance and expand community elderly care services, focusing on the Yilin Health Center business in core areas[128](index=128&type=chunk)[133](index=133&type=chunk) - Adjusting and allocating **20%** of the net proceeds (representing **18.2%** of the unutilized net proceeds) for general business purposes and working capital to supplement working capital and enhance financial management flexibility[128](index=128&type=chunk)[133](index=133&type=chunk) Analysis of Net Proceeds Usage as of June 30, 2025 (HKD millions) | Proposed Use | Planned Use in Prospectus | Utilized Before Change on June 26, 2025 | Unutilized Before Change on June 26, 2025 | Unutilized After Revised Allocation | Utilized from June 26 to 30, 2025 | Unutilized as of June 30, 2025 | Expected Full Utilization Time | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Strategic Investments and Acquisitions | 85.5 | — | 85.5 | 15.6 | — | 15.6 | December 31, 2026 | | IT Upgrades and Smart Community Management | 23.3 | 16.6 | 6.7 | 14.5 | — | 14.5 | December 31, 2026 | | Enhancement of Concierge Services | 15.6 | 13.6 | 2.0 | 2.0 | — | 2.0 | December 31, 2026 | | Enhancement and Expansion of Community Elderly Care Services | 15.6 | 10.9 | 4.7 | 51.3 | — | 51.3 | December 31, 2026 | | General Business Purposes and Working Capital | 15.6 | 12.5 | 3.1 | 18.6 | — | 18.6 | December 31, 2026 | | **Total** | **155.6** | **53.6** | **102.0** | **102.0** | **—** | **102.0** | | [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures](index=27&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares,%20Underlying%20Shares%20and%20Debentures) As of June 30, 2025, Mr. Huang Ruoqing held a 75% long position in the Company's shares through controlled corporations and a 29.82% interest in Redco Properties, with no other directors or chief executives having disclosable interests or short positions Directors' Interests in Shares and Underlying Shares | Director's Name | Capacity/Nature of Interest | Number of Shares/Underlying Shares | Approximate Percentage of Company's Shareholding | Long/Short Position/Lendable Shares | | :--- | :--- | :--- | :--- | :--- | | Mr. Huang Ruoqing | Interest in controlled corporation | 150,000,000 | 75% | Long Position | - Mr. Huang Ruoqing is deemed to have an interest in the shares held by TGI through his wholly-owned Times Property and as the settlor of the Honour Family Trust[142](index=142&type=chunk)[144](index=144&type=chunk) Directors' Interests in Associated Corporations of the Company | Director's Name | Name of Associated Corporation | Nature of Interest | Number of Shares Held | Approximate Percentage of Associated Corporation's Shareholding | | :--- | :--- | :--- | :--- | :--- | | Mr. Huang Ruoqing | Redco Properties | Interest in controlled corporation | 1,059,086,000 | 29.82% | [Directors' Rights to Acquire Shares or Debentures](index=29&type=section&id=Directors'%20Rights%20to%20Acquire%20Shares%20or%20Debentures) For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries entered into any arrangements enabling directors to acquire benefits by purchasing shares or debentures of the Company or any other body corporate - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries entered into any arrangements enabling directors to acquire benefits by purchasing shares or debentures of the Company or any other body corporate[147](index=147&type=chunk)[149](index=149&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares](index=30&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares) As of June 30, 2025, TGI held a 75% long position in the Company's shares as beneficial owner, with several related parties and Mr. Huang Ruoqing's spouse also deemed to hold the same proportion of interests Substantial Shareholders' Interests in Shares and Underlying Shares | Shareholder Name/Name | Capacity/Nature of Interest | Number of Shares | Approximate Percentage of Company's Shareholding | Long/Short Position/Lendable Shares | | :--- | :--- | :--- | :--- | :--- | | TGI | Beneficial owner | 150,000,000 | 75% | Long Position | | Redco Holdings | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Redco Properties | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Universe International Holdings Limited | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Universe Investment International Limited | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Mr. Huang | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Times International | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Honour Family | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | UBS Trustees | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Times Property | Interest in controlled corporation | 150,000,000 | 75% | Long Position | | Ms. Shi Jiafei | Spouse's interest | 150,000,000 | 75% | Long Position | | Ms. Fan Huili | Spouse's interest | 150,000,000 | 75% | Long Position | - TGI is wholly owned by Redco Holdings, which is wholly owned by Redco Properties. Redco Properties is approximately **39.76%** and **0.33%** owned by Universe and Universe Investment, respectively, both wholly and directly owned by Mr. Huang[155](index=155&type=chunk) - Times International is wholly owned by Honour Family, which is wholly owned by UBS Trustees as trustee of the Honour Family Trust. Mr. Huang Ruoqing is the settlor of the Honour Family Trust. Times Property is wholly owned by Mr. Huang Ruoqing[155](index=155&type=chunk) - Ms. Shi Jiafei is the spouse of Mr. Huang, and Ms. Fan Huili is the spouse of Mr. Huang Ruoqing; they are deemed to have an interest in the shares in which their respective spouses have an interest under the Securities and Futures Ordinance[155](index=155&type=chunk) [Condensed Consolidated Statement of Profit or Loss](index=34&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2025, the Group recorded revenue of RMB 209 million, cost of services of RMB 156.8 million, and gross profit of RMB 52.2 million, resulting in a loss of RMB 0.8 million for the period and a loss attributable to owners of the Company of RMB 5.7 million Condensed Consolidated Statement of Profit or Loss Summary (RMB thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 209,005 | 212,119 | | Cost of Services | (156,761) | (154,940) | | Gross Profit | 52,244 | 57,179 | | Other Net Income, Gains and Losses | 600 | 1,349 | | Selling and Marketing Expenses | (1,336) | (1,036) | | General and Administrative Expenses | (32,620) | (32,863) | | Impairment Losses on Financial Assets, Net of Reversal | (15,858) | (13,807) | | Operating Profit | 3,030 | 10,822 | | Net Finance Income and Costs | 34 | 162 | | Share of Net Results of Investments Accounted for Using the Equity Method | (252) | 637 | | Profit Before Income Tax | 2,812 | 11,621 | | Income Tax Expense | (3,616) | (3,898) | | **(Loss)/Profit for the Period** | **(804)** | **7,723** | | (Loss)/Profit Attributable to Owners of the Company | (5,742) | 1,073 | | (Loss)/Profit Attributable to Non-controlling Interests | 4,938 | 6,650 | | (Loss)/Earnings Per Share (RMB cents) | (2.87) | 0.54 | [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=35&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group recorded a loss for the period of RMB 0.8 million, with other comprehensive expenses of RMB 0.434 million from currency translation differences, resulting in a total comprehensive expense for the period of RMB 1.238 million Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary (RMB thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | (Loss)/Profit for the Period | (804) | 7,723 | | Other Comprehensive (Expense)/Income: | | | | －Currency Translation Differences | (434) | 560 | | **Total Comprehensive (Expense)/Income for the Period** | **(1,238)** | **8,283** | | Total Comprehensive (Expense)/Income Attributable to Owners of the Company | (6,176) | 1,633 | | Total Comprehensive (Expense)/Income Attributable to Non-controlling Interests | 4,938 | 6,650 | [Condensed Consolidated Statement of Financial Position](index=36&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were RMB 598.7 million, total liabilities were RMB 302.2 million, and total equity was RMB 296.6 million, reflecting a slight increase in non-current assets and a decrease in net current assets Condensed Consolidated Statement of Financial Position Summary (RMB thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, Plant and Equipment | 46,105 | 44,863 | | Intangible Assets | 32,230 | 34,775 | | Investments Accounted for Using the Equity Method | 2,731 | 3,564 | | Deferred Income Tax Assets | 45,989 | 42,552 | | **Total Non-current Assets** | **127,055** | **125,754** | | **Current Assets** | | | | Inventories | 8,349 | 13,412 | | Trade and Other Receivables and Prepayments | 315,368 | 286,015 | | Amounts Due from Related Parties | 25,696 | 26,803 | | Financial Assets at Fair Value Through Profit or Loss | — | 2,025 | | Cash and Cash Equivalents | 122,279 | 137,484 | | **Total Current Assets** | **471,692** | **465,739** | | **Current Liabilities** | | | | Trade Payables | 33,719 | 20,698 | | Accruals and Other Payables | 85,647 | 77,603 | | Contract Liabilities | 102,205 | 114,523 | | Amounts Due to Related Parties | 4,356 | 3,687 | | Income Tax Liabilities | 56,417 | 51,799 | | Bank and Other Borrowings | 10,003 | 8,626 | | Lease Liabilities | 156 | 147 | | **Total Current Liabilities** | **292,503** | **277,083** | | **Net Current Assets** | **179,189** | **188,656** | | **Total Assets Less Current Liabilities** | **306,244** | **314,410** | | **Non-current Liabilities** | | | | Bank and Other Borrowings | 3,700 | 3,700 | | Lease Liabilities | 2,656 | 2,950 | | Deferred Income Tax Liabilities | 3,303 | 3,661 | | **Total Non-current Liabilities** | **9,659** | **10,311** | | **Net Assets** | **296,585** | **304,099** | | **Equity Attributable to Owners of the Company** | | | | Share Capital | 16,220 | 16,220 | | Reserves | 240,461 | 246,637 | | Non-controlling Interests | 39,904 | 41,242 | | **Total Equity** | **296,585** | **304,099** | [Condensed Consolidated Statement of Changes in Equity](index=38&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, total equity attributable to owners of the Company decreased from RMB 262.9 million at the beginning of the period to RMB 256.7 million at the end, primarily due to the loss for the period and currency translation differences, with non-controlling interests also decreasing Condensed Consolidated Statement of Changes in Equity Summary (RMB thousands) | Item | Share Capital | Reserves | Total Attributable to Owners of the Company | Non-controlling Interests | Total Equity | | :--- | :--- | :--- | :--- | :--- | :--- | | As of January 1, 2025 | 16,220 | 246,637 | 262,857 | 41,242 | 304,099 | | (Loss)/Profit for the Period | — | (5,742) | (5,742) | 4,938 | (804) | | Currency Translation Differences | — | (434) | (434) | — | (434) | | **Total Comprehensive (Expense)/Income for the Period** | **—** | **(6,176)** | **(6,176)** | **4,938** | **(1,238)** | | Dividends Paid to Non-controlling Interests | — | — | — | (6,276) | (6,276) | | **As of June 30, 2025** | **16,220** | **240,461** | **256,681** | **39,904** | **296,585** | | | | | | | | | As of January 1, 2024 | 16,220 | 274,904 | 291,124 | 39,133 | 330,257 | | Profit for the Period | — | 1,073 | 1,073 | 6,650 | 7,723 | | Currency Translation Differences | — | 560 | 560 | — | 560 | | **Total Comprehensive Income for the Period** | **—** | **1,633** | **1,633** | **6,650** | **8,283** | | Dividends Paid to Non-controlling Interests | — | — | — | (6,227) | (6,227) | | **As of June 30, 2024** | **16,220** | **276,537** | **292,757** | **39,556** | **332,313** | [Condensed Consolidated Statement of Cash Flows](index=40&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, the Group's net cash used in operating activities was RMB 7.634 million, net cash used in investing activities was RMB 1.715 million, and net cash used in financing activities was RMB 5.643 million, resulting in a decrease in cash and cash equivalents to RMB 122.3 million at period-end Condensed Consolidated Statement of Cash Flows Summary (RMB thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (7,634) | (39,125) | | Net Cash (Used in)/From Investing Activities | (1,715) | 2,269 | | Net Cash Used in Financing Activities | (5,643) | (18,380) | | **Net Decrease in Cash and Cash Equivalents** | **(14,992)** | **(55,236)** | | Cash and Cash Equivalents at Beginning of Period | 137,484 | 178,854 | | Effect of Exchange Rate Changes | (213) | 519 | | **Cash and Cash Equivalents at End of Period** | **122,279** | **124,137** | [Notes to Condensed Consolidated Financial Statements](index=42&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This chapter provides detailed notes to the condensed consolidated financial statements, covering the company's general information, accounting policies, critical judgments and estimates, revenue and segment information, asset and liability changes, capital management, financial instrument risks, and related party transactions [General](index=42&type=section&id=General) Redco Healthy Living Company Limited, incorporated in the Cayman Islands and listed on the HKEX since March 31, 2022, primarily provides property management, value-added, IT system, elderly care, and property agency services in China, with Redco Properties Group Limited as its ultimate holding company - The Company was incorporated in the Cayman Islands on February 10, 2021, and has been listed on The Stock Exchange of Hong Kong Limited since March 31, 2022[170](index=170&type=chunk)[175](index=175&type=chunk) - The Group primarily provides property management services, non-owner value-added services, community value-added services, IT system development and maintenance services, elderly care management services, and property agency services in China[171](index=171&type=chunk)[175](index=175&type=chunk) - The ultimate holding company is Redco Properties Group Limited, and the ultimate controlling shareholders are Mr. Huang Ruohong and Mr. Huang Ruoqing[172](index=172&type=chunk)[175](index=175&type=chunk) [Basis of Preparation of Condensed Consolidated Financial Statements](index=43&type=section&id=Basis%20of%20Preparation%20of%20Condensed%20Consolidated%20Financial%20Statements) The condensed consolidated financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting" and apply consistent accounting policies with the annual financial statements for the year ended December 31, 2024, with no significant impact from HKAS 21 (Amendment) "Lack of Exchangeability" adopted on January 1, 2025 - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[177](index=177&type=chunk)[179](index=179&type=chunk) - The accounting policies are consistent with those applied in the annual consolidated financial statements for the year ended December 31, 2024[178](index=178&type=chunk)[180](index=180&type=chunk) - HKAS 21 (Amendment) "Lack of Exchangeability," first mandatorily adopted on January 1, 2025, had no significant impact on the Group's condensed consolidated financial statements[178](index=178&type=chunk)[180](index=180&type=chunk) [Critical Accounting Judgements and Key Sources of Estimation Uncertainty](index=44&type=section&id=Critical%20Accounting%20Judgements%20and%20Key%20Sources%20of%20Estimation%20Uncertainty) The preparation of condensed consolidated financial statements involves management judgments, estimates, and assumptions, with significant judgments and key sources of estimation uncertainty remaining consistent with those applied in the consolidated financial statements for the year ended December 31, 2024 - The preparation of condensed consolidated financial statements requires management to make judgments, estimates, and assumptions, and actual results may differ from these estimates[181](index=181&type=chunk)[184](index=184&type=chunk) - In preparing these condensed consolidated financial statements, the significant judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty are the same as those applied to the consolidated financial statements for the year ended December 31, 2024[182](index=182&type=chunk)[184](index=184&type=chunk) [Revenue and Segment Information](index=44&type=section&id=Revenue%20and%20Segment%20Information) The Group's revenue primarily derives from property management, non-owner value-added, community value-added, community elderly care, and IT and smart construction services, with property management, elderly care services, and others identified as reportable operating segments [Revenue Disaggregation](index=44&type=section&id=Revenue%20Disaggregation) The Group's revenue is disaggregated into services recognized over time (property management, non-owner value-added, community value-added, community elderly care, IT and smart construction) and services recognized at a point in time (non-owner value-added, IT and smart construction, commercial property sales) Revenue by Category (RMB thousands) | Revenue Recognition Method | Business Type | 2025 | 2024 | | :--- | :--- | :--- | :--- | | Recognized over time | Property Management Services | 165,978 | 169,230 | | | Non-owner Value-added Services | 8,973 | 9,729 | | | Community Value-added Services | 20,541 | 20,268 | | | Community Elderly Care Services | 1,796 | 4,319 | | | IT and Smart Construction Services | 2,856 | 2,508 | | | **Subtotal** | **200,144** | **206,054** | | Recognized at a point in time | Non-owner Value-added Services | 1,512 | 2,999 | | | IT and Smart Construction Services | 2,937 | 3,066 | | | Sales of Commercial Properties | 4,412 | — | | | **Subtotal** | **8,861** | **6,065** | | **Total** | | **209,005** | **212,119** | [Segment Information](index=46&type=section&id=Segment%20Information) The Group's operating segments include property management, elderly care services, and others, with property management contributing the majority of revenue and operating profit in the first half of 2025, while elderly care services and others recorded operating losses - The chief operating decision maker has identified three reportable operating segments: property management, elderly care services, and others[189](index=189&type=chunk)[191](index=191&type=chunk) Segment Revenue and Results (RMB thousands) | Item | Property Management | Elderly Care Services | Others | Total | | :--- | :--- | :--- | :--- | :--- | | **H1 2025** | | | | | | Consolidated Revenue from External Customers | 201,417 | 1,796 | 5,792 | 209,005 | | Segment Results | 6,885 | (4) | (1,060) | 5,821 | | Operating Profit (Loss) | 4,909 | (750) | (1,129) | 3,030 | | Profit (Loss) Before Income Tax | 4,507 | (511) | (1,184) | 2,812 | | **H1 2024** | | | | | | Consolidated Revenue from External Customers | 202,226 | 4,319 | 5,574 | 212,119 | | Segment Results | 14,877 | (397) | 494 | 14,974 | | Operating Profit (Loss) | 11,103 | (538) | 257 | 10,822 | | Profit (Loss) Before Income Tax | 11,563 | (102) | 160 | 11,621 | Segment Assets and Liabilities (RMB thousands) | Item | Property Management | Elderly Care Services | Others | Total | | :--- | :--- | :--- | :--- | :--- | | **June 30, 2025** | | | | | | Reportable Segment Assets | 451,544 | 86,545 | 32,383 | 570,472 | | Reportable Segment Liabilities | 244,108 | 19,349 | 27,666 | 291,123 | | **December 31, 2024** | | | | | | Reportable Segment Assets | 434,462 | 91,713 | 35,777 | 561,952 | | Reportable Segment Liabilities | 227,546 | 21,023 | 29,579 | 278,148 | [Geographical Information](index=49&type=section&id=Geographical%20Information) All of the Group's revenue is derived from China, while non-current assets (excluding financial instruments, investments accounted for using the equity method, and deferred income tax assets) are primarily located in China and Hong Kong - All of the Group's revenue is derived from China[198](index=198&type=chunk)[199](index=199&type=chunk) Non-current Assets by Geographical Area (RMB thousands) | Area | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | China | 51,637 | 51,924 | | Hong Kong | 26,698 | 27,714 | | **Total** | **78,335** | **79,638** | [Information about Major Customers](index=50&type=section&id=Information%20about%20Major%20Customers) For the six months ended June 30, 2025, revenue from Redco Properties Group, its associates, joint ventures, and their subsidiaries accounted for approximately 8.72% of the Group's total revenue, with no other single customer contributing over 10% - For the six months ended June 30, 2025, revenue from Redco Properties Group, its associates, joint ventures, and their subsidiaries accounted for approximately **8.72%** of the Group's total revenue (same period of 2024: 10.9%)[205](index=205&type=chunk)[207](index=207&type=chunk) - Other than the aforementioned related parties, no single customer contributed more than **10%** of the Group's revenue from its large number of customers[206](index=206&type=chunk)[207](index=207&type=chunk) [Other Income, Gains and Losses, Net](index=51&type=section&id=Other%20Income,%20Gains%20and%20Losses,%20Net) For the six months ended June 30, 2025, other income, gains and losses, net, amounted to RMB 0.6 million, primarily comprising government subsidies of RMB 0.238 million (2024: RMB 1.064 million) and other income Other Income, Gains and Losses, Net (RMB thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Government Subsidies | 238 | 1,064 | | Loss on Disposal of Property, Plant and Equipment | (4) | — | | Others | 366 | 285 | | **Total** | **600** | **1,349** | - Reduced government subsidies were the main reason for the decrease in other income, gains and losses, net[210](index=210&type=chunk)[211](index=211&type=chunk) [Profit Before Income Tax](index=52&type=section&id=Profit%20Before%20Income%20Tax) For the six months ended June 30, 2025, profit before income tax was RMB 2.812 million, a significant decrease from RMB 11.621 million in the prior period, with major costs including staff costs of RMB 73.51 million, depreciation of property, plant and equipment of RMB 2.791 million, and amortization of intangible assets of RMB 2.561 million Major Costs for Profit Before Income Tax (RMB thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Staff Costs | 73,510 | 84,105 | | Depreciation of Property, Plant and Equipment | 2,791 | 4,152 | | Amortization of Intangible Assets | 2,561 | 3,156 | | Cost of Services | 156,761 | 154,940 | | Expenses Related to Short-term Leases and Low-value Assets | 166 | 237 | - Staff costs decreased by **12.6%** year-on-year, primarily due to a reduction in the number of full-time employees[108](index=108&type=chunk)[110](index=110&type=chunk)[214](index=214&type=chunk) [Income Tax Expense](index=53&type=section&id=Income%20Tax%20Expense) For the six months ended June 30, 2025, income tax expense was RMB 3.616 million, a decrease from the prior period, primarily comprising China corporate income tax of RMB 7.411 million and deferred tax credit of RMB 3.795 million, with certain subsidiaries exempt and others subject to a 25% or 20% preferential tax rate Income Tax Expense (RMB thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Current Tax: China Corporate Income Tax | 7,411 | 7,324 | | Deferred Tax Credit | (3,795) | (3,426) | | **Total** | **3,616** | **3,898** | - The Company is exempt from Cayman Islands income tax, and subsidiaries incorporated in the British Virgin Islands are exempt from BVI income tax[216](index=216&type=chunk)[220](index=220&type=chunk) - China subsidiaries are subject to China corporate income tax at a rate of **25%**, with eligible small and micro enterprises enjoying a preferential tax rate of **20%**[217](index=217&type=chunk)[220](index=220&type=chunk) [Dividends](index=53&type=section&id=Dividends) The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025, and no dividends have been proposed since the end of the reporting period - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 and 2024, and no dividends have been proposed since the end of the reporting period[219](index=219&type=chunk)[221](index=221&type=chunk) [Loss/Earnings Per Share](index=54&type=section&id=Loss%2FEarnings%20Per%20Share) For the six months ended June 30, 2025, basic and diluted loss per share attributable to owners of the Company was RMB 2.87 cents, compared to earnings of RMB 0.54 cents in the prior period, with no diluted loss/earnings per share presented due to the absence of outstanding potential ordinary shares Loss/Earnings Per Share Calculation Data | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | (Loss)/Profit Attributable to Owners of the Company for the Period | (5,742) | 1,073 | | Weighted Average Number of Ordinary Shares (thousands) | 200,000 | 200,000 | | (Loss)/Earnings Per Share (RMB cents) | (2.87) | 0.54 | - No diluted (loss)/earnings per share is presented as there were no outstanding potential ordinary shares for both periods[225](index=225&type=chunk)[227](index=227&type=chunk) [Property, Plant and Equipment](index=55&type=section&id=Property,%20Plant%20and%20Equipment) As of June 30, 2025, the net carrying amount of property, plant and equipment was RMB 46.105 million, an increase from the end of 2024, primarily due to additions of furniture, office equipment, and leasehold improvements Changes in Property, Plant and Equipment (RMB thousands) | Item | H1 2025 | Full Year 2024 | | :--- | :--- | :--- | | Net Carrying Amount at Beginning of Period/Year | 44,863 | 63,299 | | Additions | 4,482 | 6,042 | | Disposals | (96) | (95) | | Depreciation | (2,791) | (7,802) | | Impairment Loss | — | (16,379) | | Exchange Differences | (353) | (202) | | **Net Carrying Amount at End of Period/Year** | **46,105** | **44,863** | - Additions to property, plant and equipment amounted to **RMB 4.482 million** in the first half of 2025[229](index=229&type=chunk) [Intangible Assets](index=56&type=section&id=Intangible%20Assets) As of June 30, 2025, the net carrying amount of intangible assets was RMB 32.230 million, a decrease from the end of 2024, primarily due to the amortization of customer relationships and computer software Changes in Intangible Assets (RMB thousands) | Item | Customer Relationships | Property Management Contracts | Service Contracts | Computer Software | Goodwill | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Carrying Amount at Beginning of H1 2025 | 7,218 | — | — | 11,597 | 15,960 | 34,775 | | Additions | — | — | — | 16 | — | 16 | | Amortization | (1,220) | — | — | (1,341) | — | (2,561) | | **Net Carrying Amount at End of H1 2025** | **5,998** | **—** | **—** | **10,272** | **15,960** | **32,230** | | | | | | | | | | Net Carrying Amount at Beginning of Full Year

目錄 CONTENTS 2 公司資料 Corporate Information 5 財務摘要 Financial Highlights 7 管理層討論及分析 Management Discussion and Analysis 47 企業管治及其他資料 Corporate Governance and Other Information 58 綜合損益及其他全面收益表 Consolidated Statement of Profit or Loss and Other Comprehensive Income 59 綜合財務狀況表 Consolidated Statement of Financial Position 60 綜合權益變動表 Consolidated Statement of Changes in Equity 62 簡明綜合現金流量表 Condensed Consolidated Cash Flow Statement 63 未經審計中期財務報告附註 Notes to the Unaudited Interim Financial Report 82 致董事會的審閱報告 Review Re ...

During the first six months of 2025, although the Group's management faced uncertainties arising from the rising interest rates that caused inflationary pressures and lower sales demand worldwide, the Group had been able to continue to launch new innovative products with good gross profit margins. To improve the cash flow further, the Group opted to exercise financial prudence to reduce safety stock for contingency planning, and to optimize fixed costs by investing in new machinery prudently to support laun ...

[Company Introduction](index=4&type=section&id=Company%20Introduction) The company is a leading global supplier of power tools and outdoor power equipment, focusing on lithium-ion battery technology innovation [Overview](index=4&type=section&id=Overview) Chervon Holdings Limited is a global leader in power tools and outdoor power equipment, driven by lithium-ion battery system technology innovation and a portfolio of renowned brands - The company is a global supplier of power tools and outdoor power equipment (OPE), specializing in lithium-ion battery system technology innovation[6](index=6&type=chunk)[10](index=10&type=chunk) - It owns five differentiated brands: EGO, FLEX, SKIL, DEVON, and X-TRON, covering major regions and market segments[6](index=6&type=chunk)[10](index=10&type=chunk) - Product lines include industrial/professional and consumer power tools, as well as high-end and mass-market OPE products[6](index=6&type=chunk)[10](index=10&type=chunk) [Our Vision](index=4&type=section&id=Our%20Vision) The company's vision is to "make great tools to empower the world" - Vision: Make great tools to empower the world[8](index=8&type=chunk)[12](index=12&type=chunk) [Our Mission](index=4&type=section&id=Our%20Mission) The company's mission is to be an innovation-driven leader in the power tool and OPE industry through continuous innovation, providing superior products to global users in the era of electrification, intelligence, and digitalization - Mission: Through continuous innovation, provide superior products to global users, becoming an innovation-driven leader in the power tool and outdoor power equipment industry in the era of electrification, intelligence, and digitalization[9](index=9&type=chunk)[13](index=13&type=chunk) [Corporate Information](index=5&type=section&id=Corporate%20Information) This section details the company's board, key personnel, and advisors, including recent changes in committee appointments and joint company secretary [Board of Directors and Committees](index=5&type=section&id=Board%20of%20Directors%20and%20Committees) This section outlines the composition of the Board of Directors and its committees, detailing changes in committee appointments effective June 30, 2025 - Mr. Pan Longquan resigned as a member of the Nomination Committee and was appointed as a member of the Remuneration Committee, effective June 30, 2025[15](index=15&type=chunk)[163](index=163&type=chunk) - Ms. Zhang Tong resigned as a member of the Remuneration Committee and was appointed as a member of the Nomination Committee, effective June 30, 2025[15](index=15&type=chunk)[163](index=163&type=chunk) [Key Personnel and Advisors](index=5&type=section&id=Key%20Personnel%20and%20Advisors) This section provides key information on the company's joint company secretaries, authorized representatives, auditor, legal counsel, and other essential corporate details, including recent changes - Ms. Lam Wing Chi resigned as Joint Company Secretary on June 30, 2025, and Ms. Lai Siu Kuen was appointed[16](index=16&type=chunk) - The auditor is KPMG[16](index=16&type=chunk)[17](index=17&type=chunk) - The company's stock code is 2285, listed on The Stock Exchange of Hong Kong Limited, with a listing date of December 30, 2021[19](index=19&type=chunk)[20](index=20&type=chunk) [Financial Summary](index=7&type=section&id=Financial%20Summary) This section provides a high-level overview of the company's financial performance and position, highlighting key results and balance sheet metrics [Results](index=7&type=section&id=Results) For the six months ended June 30, 2025, revenue grew by **11.9%** to **$912.4 million**, gross margin increased by **40 basis points** to **33.3%**, profit for the period surged by **54.6%** to **$95.3 million**, and net cash from operating activities doubled Overview of Results for the Six Months Ended June 30, 2025 | Metric | 2025 (USD '000) | 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 912,437 | 815,745 | 11.9% | | Gross Margin | 33.3% | 32.9% | +40 bps | | Profit Before Tax | 113,163 | 71,814 | 57.6% | | Profit for the Period | 95,271 | 61,619 | 54.6% | | Adjusted Net Profit | 76,031 | 61,619 | 23.4% | | Net Cash Generated from Operating Activities | 256,652 | 119,138 | 115.4% | | Basic Earnings Per Share (USD) | 0.19 | 0.12 | 58.3% | [Assets, Liabilities and Equity](index=7&type=section&id=Assets%2C%20Liabilities%20and%20Equity) As of June 30, 2025, total assets and liabilities decreased, total equity slightly reduced, while the gearing ratio remained stable Overview of Assets, Liabilities and Equity as of June 30, 2025 | Metric | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 1,823,202 | 1,992,297 | -8.5% | | Total Equity | 1,005,237 | 1,036,693 | -3.0% | | Total Liabilities | 817,965 | 955,604 | -14.4% | | Total Equity and Liabilities | 1,823,202 | 1,992,297 | -8.5% | [Management Discussion and Analysis](index=8&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an in-depth analysis of the company's operational and financial performance, strategic initiatives, and future outlook [Business Review and Outlook](index=8&type=section&id=Business%20Review%20and%20Outlook) The Group achieved strong performance with **11.9%** revenue growth to **$912.4 million** and **54.6%** net profit growth, driven by own-brand products, strong EGO gross margins, favorable exchange rates, and a one-off gain from subsidiary disposal, while accelerating capacity transfer to Vietnam - **Revenue** grew by **11.9%** to **$912.4 million** in the first half of 2025, with **net profit** increasing by **54.6%**[25](index=25&type=chunk) - OPE segment revenue increased by **22.8%**, while power tools segment revenue decreased by **2.5%**; OBM business revenue grew by **16.2%**, accounting for **77.5%** of total revenue[26](index=26&type=chunk)[29](index=29&type=chunk) - Gross margin rose by **40 basis points** to **33.3%**, primarily due to an increased sales contribution from high-margin EGO products[27](index=27&type=chunk)[30](index=30&type=chunk) - Approximately **100 new products** were launched during the reporting period, with over **90%** being lithium-ion battery products[28](index=28&type=chunk)[30](index=30&type=chunk) - The Group will accelerate the transfer of production capacity from Nanjing to Vietnam, with a significant increase in Vietnam's capacity expected in the second half of 2025, to mitigate US-China tariff impacts and enhance efficiency[44](index=44&type=chunk)[46](index=46&type=chunk) - The Group remains optimistic about the growth prospects of lithium-ion battery technology and will manage challenges proactively and cautiously[49](index=49&type=chunk)[51](index=51&type=chunk) [Brand Highlights](index=9&type=section&id=Brand%20Highlights) This section details the market performance and strategic advancements of the EGO, FLEX, SKIL, and DEVON brands, highlighting market share growth, technological breakthroughs, and channel expansion - EGO continues to grow its market share, ranking first in multiple product categories, including walk-behind lawn mowers, snow blowers, and ride-on lawn mowers, in the North American lithium-ion OPE market[32](index=32&type=chunk)[33](index=33&type=chunk)[35](index=35&type=chunk) - EGO achieved breakthroughs in IoT, AI recognition, visual positioning, and multi-sensor navigation, with smart features to be integrated in 2025 and beyond[37](index=37&type=chunk)[40](index=40&type=chunk) - FLEX was honored as the "Number One Professional Trade Partner" and successfully launched its 24V series in Australia, accelerating lithium-ion platform adoption[38](index=38&type=chunk)[40](index=40&type=chunk) - SKIL's brushless series gained high recognition in Europe and has entered major mainstream retail channels[39](index=39&type=chunk)[41](index=41&type=chunk) - DEVON outperformed the overall market in the high-end segment and received the "Annual Trend New Product Award" from TikTok e-commerce and the "2025 Strategic Lighthouse Award" from JD.com[43](index=43&type=chunk)[45](index=45&type=chunk) [Supply Chain and Manufacturing](index=11&type=section&id=Supply%20Chain%20and%20Manufacturing) The Group is actively reconfiguring its global manufacturing footprint, accelerating capacity transfer from Nanjing to Vietnam to address US-China tariffs and enhance long-term efficiency, while relocating German production to Nanjing for cost reduction - Accelerating the transfer of some production capacity from Nanjing to Vietnam, with a significant increase in Vietnam's capacity expected in the second half of 2025[44](index=44&type=chunk)[46](index=46&type=chunk) - Production at the Steinheim factory in Germany is expected to be relocated to Nanjing by the end of 2025 to reduce manufacturing costs and enhance long-term competitiveness[44](index=44&type=chunk)[46](index=46&type=chunk) [Financial Review](index=12&type=section&id=Financial%20Review) This section provides a detailed review of the Group's financial performance, covering revenue, gross profit, expenses, taxation, net profit, adjusted net profit, liquidity, financial resources, borrowings, working capital, capital expenditure, capital commitments, and pledged assets Key Financial Data for the First Half of 2025 | Metric | H1 2025 (USD '000) | H1 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 912,437 | 815,745 | 11.9% | | Gross Profit | 303,936 | 268,676 | 13.1% | | Gross Margin | 33.3% | 32.9% | +0.4% | | Profit Before Tax | 113,163 | 71,814 | 57.6% | | Profit for the Period | 95,271 | 61,619 | 54.6% | | Net Profit Margin | 10.4% | 7.6% | +2.8% | | Adjusted Net Profit | 76,031 | 61,619 | 23.4% | - Adjusted net profit excludes a one-off gain of **$19.2 million** from the disposal of Chervon (China) Investment[80](index=80&type=chunk)[85](index=85&type=chunk)[86](index=86&type=chunk) [Revenue by Product Category](index=13&type=section&id=Revenue%20by%20Product%20Category) Outdoor Power Equipment (OPE) product sales revenue increased by **22.8%**, driven by the EGO brand, while power tool sales revenue decreased by **2.5%** due to lower OEM business and a weak Chinese market Revenue by Product Category | Product Category | H1 2025 (USD '000) | H1 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | OPE Products | 602,000 | 490,400 | 22.8% | | Power Tools | 305,800 | 313,500 | -2.5% | [Revenue by Geographic Location](index=13&type=section&id=Revenue%20by%20Geographic%20Location) Revenue in North America and Europe grew by **17.9%** and **4.0%** respectively, while revenue in China and other regions decreased by **8.4%** and **13.2%** respectively Revenue by Geographic Location | Region | H1 2025 (USD '000) | H1 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | North America | 651,100 | 552,400 | 17.9% | | Europe | 179,200 | 172,300 | 4.0% | | China | 58,700 | 64,100 | -8.4% | | Rest of the World | 23,400 | 27,000 | -13.2% | [Other Net Gain](index=14&type=section&id=Other%20Net%20Gain) Other net gain significantly increased to **$31.3 million** from **$2.3 million** in the prior period, primarily due to **$12.4 million** in net foreign exchange gains and **$19.2 million** from the disposal of a subsidiary Other Net Gain | Metric | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Other Net Gain | 31,316 | 2,336 | | Of which: Net Foreign Exchange Gain | 12,400 | -700 | | Of which: Net Gain on Disposal of a Subsidiary | 19,200 | - | [Expenses and Profit](index=14&type=section&id=Expenses%20and%20Profit) Sales and distribution expenses, administrative and other operating expenses, and R&D costs all increased, while net finance costs slightly rose, and share of loss of an associate significantly decreased, collectively driving substantial growth in profit before tax and profit for the period Key Expenses and Profit Changes | Metric | H1 2025 (USD '000) | H1 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Sales and Distribution Expenses | 129,200 | 106,700 | 21.1% | | Administrative and Other Operating Expenses | 47,300 | 42,300 | 12.0% | | R&D Costs | 40,000 | 37,400 | 6.8% | | Net Finance Costs | 2,700 | 2,000 | 35.0% | | Share of Loss of an Associate | 3,900 | 13,600 | -71.3% | | Income Tax Expense | 17,900 | 10,200 | 75.5% | - Share of loss of an associate significantly decreased, primarily because the equity interest in Chervon Auto Precision Technology is no longer accounted for as an associate after the disposal of Chervon (China) Investment[72](index=72&type=chunk)[76](index=76&type=chunk) [Liquidity and Financial Resources](index=17&type=section&id=Liquidity%20and%20Financial%20Resources) The Group maintains a strong financial position with significantly increased cash and cash equivalents, stable gearing ratio despite slightly higher total borrowings, improved inventory and trade receivables turnover days, and substantially increased capital expenditure and commitments for Vietnam factory expansion Liquidity and Financial Position | Metric | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 487,700 | 328,800 | 48.3% | | Total Bank Loans | 311,700 | 295,600 | 5.4% | | Gearing Ratio | 0.3 | 0.3 | 0% | | Inventory Turnover Days | 161 days | 178 days | -17 days | | Trade and Bills Receivables Turnover Days | 83 days | 89 days | -6 days | | Capital Expenditure | 56,300 | 22,100 | 154.7% | | Capital Commitments | 138,300 | 63,700 | 117.1% | | Total Pledged Assets | 143,559 | 46,998 | 205.4% | - Capital expenditure and capital commitments significantly increased, primarily for land acquisition costs and capacity expansion at the Vietnam factory[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) - For contingent liabilities, the Group provided guarantees for certain debts of independent third-party customers in mainland China, up to **$21.7 million**[108](index=108&type=chunk)[111](index=111&type=chunk) [Material Acquisitions, Disposals of Subsidiaries and Associates](index=20&type=section&id=Material%20Acquisitions%2C%20Disposals%20of%20Subsidiaries%20and%20Associates) The company disposed of its wholly-owned subsidiary, Chervon (China) Investment Co., Ltd., on June 25, 2025, generating a net gain of **$19.2 million**, resulting in the derecognition of its equity interest in Chervon Auto Precision Technology and a proposed special dividend of **HK$1.1905** per share - The company disposed of its entire equity interest in its wholly-owned subsidiary, Chervon (China) Investment Co., Ltd., for a cash consideration of RMB **570 million** (approximately **$79.5 million** USD)[110](index=110&type=chunk)[113](index=113&type=chunk) - The disposal was completed on June 25, 2025, generating a net gain of **$19.2 million**[62](index=62&type=chunk)[67](index=67&type=chunk)[115](index=115&type=chunk) - Following the disposal, the company's equity interest in Chervon Auto Precision Technology is no longer accounted for as an associate[72](index=72&type=chunk)[76](index=76&type=chunk)[115](index=115&type=chunk) - The Board recommended a special dividend of **HK$1.1905** (approximately **$0.1526** USD) per ordinary share[110](index=110&type=chunk)[113](index=113&type=chunk)[334](index=334&type=chunk) [Major Customers and Suppliers](index=22&type=section&id=Major%20Customers%20and%20Suppliers) During the reporting period, the Group's largest customer and top five customers accounted for **34.3%** and **60.0%** of total revenue respectively, an increase from the prior period, while the largest supplier and top five suppliers accounted for **6.4%** and **13.7%** of total purchases respectively, a decrease from the prior period Customer and Supplier Concentration | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Largest Customer as % of Total Revenue | 34.3% | 30.1% | | Top Five Customers as % of Total Revenue | 60.0% | 57.7% | | Largest Supplier as % of Total Purchases | 6.4% | 14.9% | | Top Five Suppliers as % of Total Purchases | 13.7% | 28.6% | - None of the directors, their associates, or shareholders holding **5%** or more of the company's share capital had any interest in the top five customers or suppliers[126](index=126&type=chunk)[130](index=130&type=chunk) [Human Resources](index=23&type=section&id=Human%20Resources) As of June 30, 2025, the Group's total employees increased to **6,731**, with total staff costs of **$138.2 million**, while maintaining competitive remuneration, training, and share schemes to attract and retain talent, with a gender ratio of approximately **1.50 to 1** Human Resources Overview | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Number of Employees | 6,731 people | 6,133 people | | Total Staff Costs | 138.2 million USD | 110.0 million USD | - The Group offers competitive remuneration packages, performance bonuses, and long-term incentive plans, along with regular and professional training[132](index=132&type=chunk)[134](index=134&type=chunk) - As of June 30, 2025, the employee gender ratio was approximately **1.50 to 1**, which is in line with industry norms, and the Group will strive for a relatively balanced ratio in the future[133](index=133&type=chunk)[134](index=134&type=chunk) [Corporate Governance and Other Information](index=24&type=section&id=Corporate%20Governance%20and%20Other%20Information) This section covers the company's corporate governance practices, directors' and shareholders' interests, dividends, and other relevant disclosures [Directors' and Chief Executive's Interests in Shares, Underlying Shares and Debentures](index=24&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) This section discloses the interests of the company's directors and chief executive in shares of the company and its associated corporations as of June 30, 2025, primarily held through controlled corporations, detailing the shareholding percentages of Mr. Pan Longquan, Ms. Zhang Tong, and Mr. Ke Zuqian Directors' Interests in the Company's Shares (as of June 30, 2025) | Name of Director | Nature of Interest | Number of Shares | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Pan Longquan | Interest of Controlled Corporation | 260,226,344 (L) | 50.92% | | Ms. Zhang Tong | Interest of Controlled Corporation | 98,010,850 (L) | 19.18% | | Mr. Ke Zuqian | Interest of Controlled Corporation | 27,118,822 (L) | 5.31% | - As of June 30, 2025, the total number of issued shares was **511,053,811** shares[140](index=140&type=chunk) [Substantial Shareholders' and Other Persons' Interests in Shares and Underlying Shares](index=29&type=section&id=Substantial%20Shareholders%27%20and%20Other%20Persons%27%20Interests%20in%20Shares%20and%20Underlying%20Shares) This section lists the interests of substantial shareholders and other persons, excluding directors and the chief executive, in the company's shares as of June 30, 2025, including Panmercy, Green Hope, China Minsheng Banking Corp., Ltd., and Klamm Substantial Shareholders' Interests in the Company's Shares (as of June 30, 2025) | Name of Shareholder | Nature of Interest | Number of Shares | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | | Panmercy | Beneficial Owner | 260,226,344 (L) | 50.92% | | Green Hope | Beneficial Owner | 97,637,750 (L) | 19.18% | | China Minsheng Banking Corp., Ltd. | Interest of Controlled Corporation | 41,940,000 (L) | 8.21% | | Klamm | Beneficial Owner | 27,118,822 (L) | 5.31% | [Interim Dividend](index=30&type=section&id=Interim%20Dividend) The Board has resolved not to declare an interim dividend for the six months ended June 30, 2025 - The Board has resolved not to declare an interim dividend for the six months ended June 30, 2025[153](index=153&type=chunk)[156](index=156&type=chunk) [Purchase, Sale or Redemption of the Listed Securities](index=30&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Listed%20Securities) During the reporting period, neither the company nor its subsidiaries purchased, redeemed, or sold any listed securities, except for share purchases under the share award scheme - During the reporting period, neither the company nor its subsidiaries purchased, redeemed, or sold any listed securities, except for share purchases under the share award scheme[154](index=154&type=chunk)[157](index=157&type=chunk) [Changes to Directors' and Senior Management's Information](index=31&type=section&id=Changes%20to%20Directors%27%20and%20Senior%20Management%27s%20Information) This section discloses changes to directors' information since the publication of the 2024 annual report, primarily concerning adjustments to Mr. Pan Longquan's and Ms. Zhang Tong's roles in the Nomination and Remuneration Committees - Mr. Pan Longquan resigned as a member of the Nomination Committee and was appointed as a member of the Remuneration Committee, effective June 30, 2025[159](index=159&type=chunk)[163](index=163&type=chunk) - Ms. Zhang Tong resigned as a member of the Remuneration Committee and was appointed as a member of the Nomination Committee, effective June 30, 2025[159](index=159&type=chunk)[163](index=163&type=chunk) [Public Float](index=31&type=section&id=Public%20Float) The company has been granted a waiver from strict compliance with the public float requirement by the Stock Exchange, with at least **18.43%** of its issued share capital held by the public as of the reporting date, meeting the minimum public float under the waiver - The company has been granted a waiver from strict compliance with the public float requirement under Note 2 to Rule 8.08(1) of the Listing Rules by the Stock Exchange[160](index=160&type=chunk)[162](index=162&type=chunk) - As of the reporting date, at least **18.43%** of the company's issued share capital was held by the public, meeting the minimum public float required by the waiver[160](index=160&type=chunk)[162](index=162&type=chunk) [2024 Share Scheme](index=32&type=section&id=2024%20Share%20Scheme) The 2024 Share Scheme, adopted on January 29, 2024, aims to align interests, drive performance, and attract and retain talent, with **2,117,600 shares** (approximately **0.4%** of total share capital) purchased by the trustee during the reporting period - The 2024 Share Scheme aims to align the interests of shareholders, the company, and employees, drive performance growth, and improve long-term incentive mechanisms to attract and retain outstanding talent[164](index=164&type=chunk)[167](index=167&type=chunk) - Between June 11 and 19, 2025, the trustee of the 2024 Share Scheme purchased a total of **2,117,600 shares** in the market, representing approximately **0.4%** of the company's total shares[165](index=165&type=chunk)[168](index=168&type=chunk) - As of the reporting date, the total number of shares available for grant under the 2024 Share Scheme was **51,105,381** shares, representing **10%** of the issued shares on the adoption date[164](index=164&type=chunk)[167](index=167&type=chunk) [Event After the Reporting Period](index=33&type=section&id=Event%20After%20the%20Reporting%20Period) No material disclosable events occurred after the reporting period and up to the date of this report, other than those already disclosed - No material events occurred after the reporting period, other than those already disclosed[170](index=170&type=chunk)[174](index=174&type=chunk) [Audit Committee](index=33&type=section&id=Audit%20Committee) The Board has established an Audit Committee, comprising three independent non-executive directors, responsible for reviewing accounting principles, internal controls, and financial reporting matters, including the interim financial information for the six months ended June 30, 2025 - The Audit Committee comprises three independent non-executive directors: Dr. Li Minghui (Chairman), Mr. Tian Ming, and Mr. Jiang Li[171](index=171&type=chunk)[175](index=175&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and discussed internal controls and financial reporting matters, including the interim financial information for the six months ended June 30, 2025[172](index=172&type=chunk)[175](index=175&type=chunk) [Independent Review of Auditor](index=33&type=section&id=Independent%20Review%20of%20Auditor) The Group's interim financial report for the six months ended June 30, 2025, is unaudited but has been reviewed by KPMG in accordance with Hong Kong Standard on Review Engagements 2410 - The interim financial report is unaudited but has been reviewed by KPMG in accordance with Hong Kong Standard on Review Engagements 2410[173](index=173&type=chunk)[176](index=176&type=chunk) [Corporate Governance Practices](index=34&type=section&id=Corporate%20Governance%20Practices) The company is committed to high corporate governance standards, adopting and complying with the Corporate Governance Code in Appendix C1 of the Listing Rules, with the exception of the combined roles of Chairman and CEO, which the Board believes ensures consistent leadership and efficient strategic planning - The company has adopted and complies with all applicable code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules[177](index=177&type=chunk)[178](index=178&type=chunk)[180](index=180&type=chunk)[181](index=181&type=chunk) - The roles of Chairman and Chief Executive Officer are combined and held by Mr. Pan Longquan, which deviates from code provision C.2.1, but the Board believes this arrangement ensures consistent leadership and efficient strategic planning[179](index=179&type=chunk)[181](index=181&type=chunk) - The Board will reassess the division of roles from time to time and may propose to separate the two roles in the future[183](index=183&type=chunk)[184](index=184&type=chunk) [Model Code for Securities Transactions](index=35&type=section&id=Model%20Code%20for%20Securities%20Transactions) The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers, and all directors confirmed compliance during the reporting period - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers[185](index=185&type=chunk)[186](index=186&type=chunk) - All directors confirmed compliance with the Model Code during the reporting period, with no instances of non-compliance[185](index=185&type=chunk)[186](index=186&type=chunk) [Independent Auditor's Report](index=36&type=section&id=Independent%20Auditor%27s%20Report) This section presents the independent auditor's review report on the interim financial information, outlining the scope and conclusion of their work [Introduction](index=36&type=section&id=Introduction) KPMG has reviewed Chervon Holdings Limited's interim financial report for the six months ended June 30, 2025, prepared in accordance with Hong Kong Accounting Standard 34, with the Board responsible for its preparation and presentation - KPMG has reviewed the interim financial report for the six months ended June 30, 2025[188](index=188&type=chunk)[191](index=191&type=chunk) - The interim financial report was prepared in accordance with Hong Kong Accounting Standard 34, with the Board responsible for its preparation and presentation[188](index=188&type=chunk)[191](index=191&type=chunk) [Scope of Review](index=36&type=section&id=Scope%20of%20Review) The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is substantially less in scope than an audit, thus no audit opinion is expressed, only a conclusion based on the review - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is substantially less in scope than an audit[190](index=190&type=chunk)[193](index=193&type=chunk) - No audit opinion is expressed, only a conclusion based on the review[190](index=190&type=chunk)[193](index=193&type=chunk) [Conclusion](index=37&type=section&id=Conclusion) Based on the review, the auditor found no matters suggesting that the interim financial report as of June 30, 2025, was not prepared in all material respects in accordance with Hong Kong Accounting Standard 34 - The auditor found no matters that lead them to believe the interim financial report as of June 30, 2025, was not prepared in all material respects in accordance with Hong Kong Accounting Standard 34[195](index=195&type=chunk)[196](index=196&type=chunk) [Consolidated Statement of Profit or Loss](index=38&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) This section presents the consolidated statement of profit or loss, detailing the company's revenues, expenses, and net profit for the reporting period [Profit or Loss Summary](index=38&type=section&id=Profit%20or%20Loss%20Summary) For the six months ended June 30, 2025, revenue increased by **11.9%** to **$912.4 million**, gross profit grew by **13.1%** to **$303.9 million**, profit for the period surged by **54.6%** to **$95.3 million**, and basic earnings per share were **$0.19** Key Data from Consolidated Statement of Profit or Loss | Metric | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Revenue | 912,437 | 815,745 | | Cost of Revenue | (608,501) | (547,069) | | Gross Profit | 303,936 | 268,676 | | Other Income | 1,013 | 2,722 | | Other Net Gain | 31,316 | 2,336 | | Sales and Distribution Expenses | (129,168) | (106,667) | | Administrative and Other Operating Expenses | (47,338) | (42,264) | | R&D Costs | (39,984) | (37,433) | | Operating Profit | 119,775 | 87,370 | | Net Finance Costs | (2,672) | (1,975) | | Share of Loss of an Associate | (3,940) | (13,581) | | Profit Before Tax | 113,163 | 71,814 | | Income Tax Expense | (17,892) | (10,195) | | Profit for the Period | 95,271 | 61,619 | | Basic Earnings Per Share (USD) | 0.19 | 0.12 | [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=39&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) This section presents the consolidated statement of profit or loss and other comprehensive income, providing a complete view of the company's financial performance [Comprehensive Income Summary](index=39&type=section&id=Comprehensive%20Income%20Summary) For the six months ended June 30, 2025, profit for the period was **$95.3 million**, other comprehensive income (net of tax) was **$1.0 million**, mainly from exchange differences on translating financial statements of foreign operations, leading to a total comprehensive income of **$96.3 million**, a significant increase from **$40.8 million** in the prior year Key Data from Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Profit for the Period | 95,271 | 61,619 | | Other Comprehensive Income (net of tax that may be reclassified to profit or loss) | | | | Remeasurement of Net Defined Benefit Liability | 11 | 10 | | Exchange Differences | 1,005 | (20,834) | | Total Comprehensive Income for the Period | 96,287 | 40,795 | - Exchange differences turned from a loss of **$20.8 million** in the first half of 2024 to a gain of **$1.0 million** in the first half of 2025, positively impacting total comprehensive income[201](index=201&type=chunk) [Consolidated Statement of Financial Position](index=40&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) This section presents the consolidated statement of financial position, providing a snapshot of the company's assets, liabilities, and equity at the reporting date [Financial Position Summary](index=40&type=section&id=Financial%20Position%20Summary) As of June 30, 2025, total assets were **$1,823.2 million**, a decrease from December 31, 2024, with a slight increase in net current assets, total equity of **$1,005.2 million**, and total liabilities of **$818.0 million** Key Data from Consolidated Statement of Financial Position | Metric | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, Plant and Equipment | 284,868 | 282,495 | | Right-of-Use Assets | 62,142 | 57,511 | | Interests in an Associate | – | 67,348 | | Total Non-current Assets | 437,014 | 478,767 | | **Current Assets** | | | | Inventories | 479,065 | 608,304 | | Trade and Bills Receivables | 356,646 | 489,473 | | Cash and Cash Equivalents | 487,686 | 328,758 | | Total Current Assets | 1,386,188 | 1,513,530 | | **Current Liabilities** | | | | Bank Loans | 194,318 | 192,619 | | Trade and Bills Payables | 170,375 | 317,942 | | Total Current Liabilities | 644,021 | 782,968 | | **Non-current Liabilities** | | | | Bank Loans | 117,398 | 102,935 | | Total Non-current Liabilities | 173,944 | 172,636 | | **Total Equity** | | | | Total Equity | 1,005,237 | 1,036,693 | - Interests in an associate decreased to zero, reflecting the impact of the disposal of Chervon (China) Investment Co., Ltd[203](index=203&type=chunk) - Cash and cash equivalents significantly increased, while inventories and trade and bills receivables notably decreased[203](index=203&type=chunk) [Consolidated Statement of Changes in Equity](index=43&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) This section presents the consolidated statement of changes in equity, illustrating movements in the company's equity components over the reporting period [Equity Changes Summary](index=43&type=section&id=Equity%20Changes%20Summary) For the six months ended June 30, 2025, total equity decreased from **$1,036.7 million** to **$1,005.2 million**, with a net reduction primarily due to **$118.7 million** in dividends paid, **$4.0 million** for share purchases under the share award scheme, and **$3.8 million** from the disposal of an associate Key Data from Consolidated Statement of Changes in Equity | Metric | H1 2025 (USD '000) | | :--- | :--- | | Balance at January 1 | 1,036,693 | | Profit for the Period | 95,271 | | Other Comprehensive Income | 1,016 | | Total Comprehensive Income | 96,287 | | Appropriation of Dividends | (118,717) | | Purchase of Shares for Share Award Scheme | (4,049) | | Share of Other Reserves of an Associate | (1,135) | | Disposal of Interest in an Associate | (3,842) | | Balance at June 30 | 1,005,237 | - Dividends paid during the period totaled **$118.7 million**, including a final dividend of **$40.9 million** and a special dividend of **$78.0 million**[214](index=214&type=chunk)[334](index=334&type=chunk) - **$4.0 million** was paid for the purchase of shares under the share award scheme[214](index=214&type=chunk)[339](index=339&type=chunk) [Condensed Consolidated Cash Flow Statement](index=46&type=section&id=Condensed%20Consolidated%20Cash%20Flow%20Statement) This section presents the condensed consolidated cash flow statement, summarizing the cash inflows and outflows from operating, investing, and financing activities [Cash Flow Summary](index=46&type=section&id=Cash%20Flow%20Summary) For the six months ended June 30, 2025, net cash from operating activities surged by **115.4%** to **$256.7 million**, investing activities generated **$19.2 million** net cash, primarily from subsidiary and financial asset disposals, while financing activities used **$118.6 million** net cash, mainly for dividends and share purchases, increasing period-end cash and cash equivalents to **$487.7 million** Key Data from Condensed Consolidated Cash Flow Statement | Metric | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 256,652 | 119,138 | | Net Cash Generated from/(Used in) Investing Activities | 19,234 | (22,309) | | Net Cash Used in Financing Activities | (118,632) | (4,439) | | Net Increase in Cash and Cash Equivalents | 157,254 | 92,390 | | Cash and Cash Equivalents at End of Period | 487,686 | 387,090 | - Net cash generated from operating activities significantly increased by **115.4%**, indicating improved operational efficiency[216](index=216&type=chunk) - Investing activities shifted from a net outflow last year to a net inflow, primarily due to proceeds of **$78.5 million** from the disposal of a subsidiary[216](index=216&type=chunk) - Cash outflow from financing activities significantly increased, mainly due to **$118.7 million** in dividends paid[219](index=219&type=chunk) [Notes to the Unaudited Interim Financial Report](index=48&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Financial%20Report) This section provides detailed explanatory notes to the unaudited interim financial report, offering further insights into the company's financial figures and accounting policies [General Information](index=48&type=section&id=General%20Information) Chervon Holdings Limited was incorporated in Hong Kong on February 19, 1999, listed on the Main Board of the HKEX on December 30, 2021, and primarily engages in R&D, manufacturing, testing, sales, and after-sales services for power tools, OPE, and related products - The company was incorporated in Hong Kong on February 19, 1999, and listed on the Main Board of The Stock Exchange of Hong Kong Limited on December 30, 2021[221](index=221&type=chunk)[226](index=226&type=chunk) - The Group primarily engages in the research and development, manufacturing, testing, sales, and after-sales services of power tools, outdoor power equipment, and related products[222](index=222&type=chunk)[226](index=226&type=chunk) [Basis of Preparation](index=48&type=section&id=Basis%20of%20Preparation) This interim financial report is prepared in accordance with applicable disclosure requirements of the HKEX Listing Rules and Hong Kong Accounting Standard 34, authorized for issue, and reviewed by KPMG - This interim financial report was prepared in accordance with Hong Kong Accounting Standard 34 and authorized for issue on August 28, 2025[223](index=223&type=chunk)[227](index=227&type=chunk) - The report is unaudited but has been reviewed by KPMG in accordance with Hong Kong Standard on Review Engagements 2410[230](index=230&type=chunk)[233](index=233&type=chunk) [Changes in Accounting Policies](index=50&type=section&id=Changes%20in%20Accounting%20Policies) The Group applied amendments to HKAS 21, "The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability," which had no material impact due to the absence of relevant foreign currency transactions, and has not yet applied any new standards or interpretations not yet effective - The Group has applied amendments to HKAS 21, "The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability," but it had no material impact[235](index=235&type=chunk)[238](index=238&type=chunk) - The Group has not yet applied any new standards or interpretations that are not yet effective[236](index=236&type=chunk)[239](index=239&type=chunk) [Revenue and Segment Reporting](index=50&type=section&id=Revenue%20and%20Segment%20Reporting) This section details the Group's revenue by major business line and geographic location, along with gross profit for each reporting segment, highlighting significant growth in outdoor power equipment revenue and strong contributions from North American and European markets Revenue by Major Product Category | Product Category | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Sales of Power Tools | 305,760 | 313,500 | | Sales of Outdoor Power Equipment | 601,999 | 490,421 | | Others | 4,678 | 11,824 | | Total | 912,437 | 815,745 | Revenue by Geographic Location | Region | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | North America | 651,087 | 552,372 | | Europe | 179,233 | 172,296 | | China | 58,693 | 64,091 | | Rest of the World | 23,424 | 26,986 | | Total | 912,437 | 815,745 | - The Group's reporting segments include power tools, outdoor power equipment, and other businesses involving sales of components to home appliance companies[248](index=248&type=chunk) [Other Revenue and Other Net Gain/(Loss)](index=57&type=section&id=Other%20Revenue%20and%20Other%20Net%20Gain%2F%28Loss%29) Other revenue decreased from **$2.7 million** to **$1.0 million** due to reduced scrap sales, while other net gain significantly increased from **$2.3 million** to **$31.3 million**, driven by **$12.4 million** in net foreign exchange gains and **$19.2 million** from the disposal of a subsidiary Other Revenue | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Government Grants | 644 | 382 | | Sales of Scrap Materials | 179 | 2,146 | | Rental Income | 190 | 194 | | Total | 1,013 | 2,722 | Other Net Gain | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Net Foreign Exchange Gain/(Loss) | 12,372 | (741) | | Net Gain on Disposal of a Subsidiary | 19,240 | – | | Total | 31,316 | 2,336 | - A net gain of **$19.2 million** was recognized from the disposal of Chervon (China) Investment Co., Ltd[270](index=270&type=chunk) [Profit Before Taxation](index=59&type=section&id=Profit%20Before%20Taxation) Profit before taxation significantly increased to **$113.2 million** from **$71.8 million** in the prior period, with this section detailing net finance costs and other profit-impacting items such as depreciation, amortization, and inventory write-down provisions Net Finance Costs | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Interest Income from Bank Deposits | (2,565) | (3,683) | | Interest on Bank Loans | 4,632 | 5,593 | | Interest on Lease Liabilities | 605 | 65 | | Net Finance Costs | 2,672 | 1,975 | Other Items Affecting Profit | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Depreciation Expense | 32,325 | 22,305 | | Amortisation of Intangible Assets | 125 | 148 | | Provision for Write-down of Inventories | 8,549 | 320 | | Cost of Inventories Sold | 608,501 | 547,069 | [Income Tax](index=60&type=section&id=Income%20Tax) Income tax expense for the period was **$17.9 million**, a **75.5%** increase from the prior period, with an effective tax rate of **15.8%**, reflecting the application of domestic minimum top-up tax in certain countries since January 1, 2024, and the anticipated application of Pillar Two income tax in Hong Kong and mainland China from January 1, 2025 Income Tax Expense | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Mainland China Corporate Income Tax | 2,423 | 6,144 | | Hong Kong Profits Tax | 14,437 | – | | Tax Jurisdictions Outside Mainland China and Hong Kong | 2,421 | 5,653 | | Deferred Tax | (1,389) | (1,602) | | Total Income Tax Expense | 17,892 | 10,195 | - The effective tax rate for the first half of 2025 was **15.8%**, compared to **14.2%** for the same period in 2024[74](index=74&type=chunk) - From January 1, 2024, the Group's profits in Vietnam, Canada, the UK, and certain European countries are subject to domestic minimum top-up tax[284](index=284&type=chunk)[289](index=289&type=chunk) - From January 1, 2025, the Group's profits in the Hong Kong Special Administrative Region and mainland China will also be subject to Pillar Two income tax under the Hong Kong Inland Revenue (Amendment) Ordinance 2025[285](index=285&type=chunk)[289](index=289&type=chunk) [Earnings Per Share](index=61&type=section&id=Earnings%20Per%20Share) For the six months ended June 30, 2025, basic earnings per share increased by **58.3%** to **$0.19** from **$0.12** in the prior period, with diluted earnings per share being equal to basic earnings per share due to the absence of potential dilutive ordinary shares Earnings Per Share | Metric | H1 2025 (USD) | H1 2024 (USD) | | :--- | :--- | :--- | | Basic Earnings Per Share | 0.19 | 0.12 | | Diluted Earnings Per Share | 0.19 | 0.12 | - Basic earnings per share are calculated based on profit attributable to ordinary equity shareholders of **$95.2 million** and a weighted average of **509,775,827** ordinary shares[287](index=287&type=chunk)[291](index=291&type=chunk) - There were no potential dilutive ordinary shares for the six months ended June 30, 2025, and 2024, thus diluted earnings per share equal basic earnings per share[288](index=288&type=chunk)[292](index=292&type=chunk) [Property, Plant and Equipment and Intangible Assets](index=62&type=section&id=Property%2C%20Plant%20and%20Equipment%20and%20Intangible%20Assets) During the reporting period, the Group acquired **$32.2 million** in property, plant, and equipment, disposed of **$1.5 million** net book value of related assets, and increased right-of-use assets by **$8.6 million** due to new capitalized lease payments, with certain property, plant, and equipment and leasehold land pledged as collateral for bank loans as of June 30, 2025 Changes in Property, Plant and Equipment and Right-of-Use Assets | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Additions to Property, Plant and Equipment | 32,165 | 23,201 | | Net Book Value of Property, Plant and Equipment Disposed Of | 1,539 | 2,374 | | Additions to Right-of-Use Assets | 8,608 | 3,859 | - As of June 30, 2025, property, plant and equipment with a net book value of **$85.4 million** and leasehold land of **$43.4 million** were pledged as collateral for bank loans[295](index=295&type=chunk)[297](index=297&type=chunk)[298](index=298&type=chunk)[299](index=299&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=63&type=section&id=Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, the Group's total financial assets at fair value through profit or loss amounted to **$14.1 million**, comprising **$6.7 million** in non-current insurance products and **$7.4 million** in current structured deposits and wealth management products Financial Assets at Fair Value Through Profit or Loss | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Insurance Products (Non-current) | 6,704 | 6,586 | | Structured Deposits and Wealth Management Products (Current) | 7,404 | – | | Total | 14,108 | 6,586 | - Current financial assets primarily consist of structured deposits and wealth management products issued by banks[301](index=301&type=chunk)[303](index=303&type=chunk) [Inventories](index=64&type=section&id=Inventories) As of June 30, 2025, the Group's inventories decreased to **$479.1 million** from **$608.3 million** on December 31, 2024, with **$8.5 million** in inventory write-down provisions and **$2.5 million** in inventory write-offs recognized during the period Composition of Inventories | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Raw Materials | 136,736 | 187,557 | | Consumables | 4,086 | 3,941 | | Work in Progress | 10,229 | 16,167 | | Finished Goods | 368,833 | 435,453 | | Write-down of Inventories | (40,819) | (34,814) | | Total | 479,065 | 608,304 | - During the six months ended June 30, 2025, **$8.5 million** in inventory write-down provisions and **$2.5 million** in inventory write-offs were recognized[304](index=304&type=chunk)[305](index=305&type=chunk)[306](index=306&type=chunk)[307](index=307&type=chunk) [Trade and Bills Receivables](index=65&type=section&id=Trade%20and%20Bills%20Receivables) As of June 30, 2025, total trade and bills receivables significantly decreased to **$356.6 million** from **$489.5 million** on December 31, 2024, with all receivables expected to be recovered within one year and an improved turnover period of **83 days** Trade and Bills Receivables | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Measured at Amortised Cost | 355,157 | 484,735 | | Measured at Fair Value Through Other Comprehensive Income | 1,489 | 4,738 | | Total | 356,646 | 489,473 | Ageing Analysis of Trade and Bills Receivables | Ageing | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Within 6 Months | 351,131 | 480,763 | | Over 6 Months but Within 12 Months | 3,542 | 3,414 | | Over 12 Months | 484 | 558 | | Total | 355,157 | 484,735 | - Trade and bills receivables turnover days improved to **83 days** from **89 days** in the same period of 2024[95](index=95&type=chunk)[98](index=98&type=chunk) [Prepayments, Deposits and Other Receivables](index=67&type=section&id=Prepayments%2C%20Deposits%20and%20Other%20Receivables) As of June 30, 2025, current prepayments, deposits, and other receivables totaled **$24.6 million**, while non-current amounted to **$27.1 million**, primarily comprising **$21.8 million** in prepayments for leasehold land Prepayments, Deposits and Other Receivables | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | **Current** | | | | Recoverable VAT | 8,698 | 15,068 | | Prepayments for Materials and Expenses | 6,572 | 16,289 | | Other Deposits and Receivables | 7,068 | 4,505 | | Total Current | 24,604 | 42,122 | | **Non-current** | | | | Prepayments for Leasehold Land | 21,840 | – | | Total Non-current | 27,138 | 7,824 | - Non-current prepayments for leasehold land increased from zero on December 31, 2024, to **$21.8 million**[316](index=316&type=chunk) [Cash and Cash Equivalents and Pledged Deposits](index=68&type=section&id=Cash%20and%20Cash%20Equivalents%20and%20Pledged%20Deposits) As of June 30, 2025, cash and cash equivalents totaled **$487.7 million**, with **$411.0 million** located in mainland China, and pledged deposits amounted to **$17.3 million**, primarily for issuing bank financing Cash and Cash Equivalents | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Cash at Bank | 487,619 | 328,688 | | Cash on Hand | 67 | 70 | | Total | 487,686 | 328,758 | - As of the reporting period end, cash and cash equivalents located in mainland China amounted to **$411.0 million**, with fund remittances subject to foreign exchange control regulations[319](index=319&type=chunk) Pledged Deposits | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Issuance of Bills Payable | 2,585 | 4,765 | | Granting of Bank Facilities | 14,688 | 15,424 | | Total | 17,273 | 20,189 | [Bank Loans](index=69&type=section&id=Bank%20Loans) As of June 30, 2025, the Group's total bank loans were **$311.7 million**, with **$194.3 million** due within one year or repayable on demand, primarily denominated in RMB, and split **58.2%** fixed-rate and **41.8%** floating-rate Bank Loan Maturity Profile | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Short-term Bank Loans | 144,777 | 126,599 | | Current Portion of Long-term Bank Loans | 49,541 | 66,020 | | Within 1 Year or On Demand | 194,318 | 192,619 | | After 1 Year but Within 2 Years | 117,398 | 102,935 | | Total | 311,716 | 295,554 | Bank Loan Collateral and Guarantee Status | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Secured | 39,841 | 34,546 | | Secured and Guaranteed | 126,561 | 131,879 | | Guaranteed | 78,212 | 87,488 | | Unsecured and Unguaranteed | 67,102 | 41,641 | | Total | 311,716 | 295,554 | [Trade and Bills Payables](index=70&type=section&id=Trade%20and%20Bills%20Payables) As of June 30, 2025, total trade and bills payables significantly decreased to **$170.4 million** from **$317.9 million** on December 31, 2024, with all payables expected to be settled within one year or on demand Trade and Bills Payables | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Trade Payables | 155,072 | 294,758 | | Bills Payable | 15,303 | 23,184 | | Total | 170,375 | 317,942 | Ageing Analysis of Trade and Bills Payables | Ageing | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Within 3 Months | 169,928 | 253,734 | | Over 3 Months but Within 12 Months | 447 | 64,208 | | Total | 170,375 | 317,942 | [Other Payables and Accruals](index=71&type=section&id=Other%20Payables%20and%20Accruals) As of June 30, 2025, total other payables and accruals were **$193.3 million**, largely consistent with **$196.6 million** on December 31, 2024, primarily comprising marketing and advertising expenses, salaries, wages, bonuses, and benefits Other Payables and Accruals | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Other Payables and Accrued Expenses | 148,166 | 132,312 | | Accrued Salaries, Wages, Bonuses and Benefits | 21,177 | 38,642 | | Payables for Acquisition of Property, Plant and Equipment | 3,166 | 8,190 | | Other Taxes Payable | 20,482 | 17,109 | | Total | 193,304 | 196,600 | [Capital, Reserves and Dividends](index=72&type=section&id=Capital%2C%20Reserves%20and%20Dividends) During the reporting period, the company declared and approved **$118.7 million** in total dividends, comprising final and special dividends, while the Board resolved not to declare an interim dividend for the six months ended June 30, 2025, and the trustee purchased **2,117,600 shares** for the 2024 Share Scheme Dividends Declared and Approved | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Final Dividend for Prior Financial Year | 40,987 | 18,091 | | Special Dividend for Prior Financial Year | 77,986 | – | | Less: Dividends on Repurchased Shares Held by the Company | (256) | – | | Total | 118,717 | 18,091 | - The Board does not recommend an interim dividend for the six months ended June 30, 2025, and 2024[335](index=335&type=chunk) - For the 2024 Share Scheme, the trustee purchased **2,117,600 shares** in the market between June 11 and 19, 2025, for a total of **$4.0 million**, fully appropriated from retained profits[339](index=339&type=chunk)[340](index=340&type=chunk)[341](index=341&type=chunk) [Material Related Party Transactions](index=74&type=section&id=Material%20Related%20Party%20Transactions) This section discloses material related party transactions, including lease payments, payments on behalf of, and receivables with Nanjing Chervon Auto Precision Technology Co., Ltd., the disposal of a subsidiary to Chervon Precision Technology Holdings Limited, and guarantees provided by Chervon (China) Investment Co., Ltd. for certain bank loans Material Related Party Transactions | Item | H1 2025 (USD '000) | H1 2024 (USD '000) | | :--- | :--- | :--- | | Lease Payments from Nanjing Chervon Auto Precision Technology Co., Ltd. | 180 | 182 | | Payments Made on Behalf of a Related Party (Nanjing Chervon Auto Precision Technology Co., Ltd.) | 475 | 551 | | Disposal of a Subsidiary to Chervon Precision Technology Holdings Limited | 79,533 | – | - As of June 30, 2025, Chervon (China) Investment Co., Ltd. provided guarantees for **$203.4 million** of the Group's bank loans and pledged its equity interest in Nanjing Chervon Auto Precision Technology Co., Ltd[347](index=347&type=chunk)[349](index=349&type=chunk) [Fair Value Measurement of Financial Instruments](index=75&type=section&id=Fair%20Value%20Measurement%20of%20Financial%20Instruments) This section provides fair value measurement information for the Group's financial instruments, classified into three fair value hierarchy levels as defined by HKFRS 13, primarily including financial assets at fair value through profit or loss (insurance products, structured deposits, and wealth management products) and derivative financial instruments (foreign currency forward contracts, option contracts, and swap contracts) Recurring Fair Value Measurements (as of June 30, 2025) | Item | Fair Value (USD '000) | Level 1 (USD '000) | Level 2 (USD '000) | Level 3 (USD '000) | | :--- | :--- | :--- | :--- | :--- | | **Financial Assets at Fair Value Through Profit or Loss** | | | | | | Insurance Products | 6,704 | – | – | 6,704 | | Structured Deposits and Wealth Management Products | 7,404 | – | – | 7,404 | | **Derivative Financial Instruments (Assets)** | | | | | | Foreign Currency Forward Contracts | 2,531 | – | 2,531 | – | | Foreign Currency Option Contracts | 50 | – | 50 | – | | Foreign Exchange Swap Contracts | 2,141 | – | 2,141 | – | | **Derivative Financial Instruments (Liabilities)** | | | | | | Foreign Currency Forward Contracts | (2,255) | – | (2,255) | – | | Foreign Exchange Swap Contracts | (344) | – | (344) | – | | Trade Receivables | 1,489 | – | – | 1,489 | - Level 2 fair value measurements primarily use the difference between discounted contract forward prices and current forward prices, considering relevant government yield curves and credit spreads[356](index=356&type=chunk)[358](index=358&type=chunk) - Level 3 fair value measurements, such as insurance products, structured deposits and wealth management products, and trade receivables, primarily use cash value or discounted cash flow valuation techniques, positively correlated with expected rates of return[362](index=362&type=chunk)[363](index=363&type=chunk) [Commitments](index=81&type=section&id=Commitments) As of June 30, 2025, the Group's total capital commitments significantly increased to **$138.3 million** from **$63.7 million** on December 31, 2024, primarily for the construction of plant and buildings and acquisition of machinery and equipment, with most authorized but not yet contracted Capital Commitments | Item | June 30, 2025 (USD '000) | December 31, 2024 (USD '000) | | :--- | :--- | :--- | | Contracted | 17,048 | 28,290 | | Authorized but Not Contracted | 121,261 | 35,408 | | Total | 138,309 | 63,698 | | Of which: Construction of Plant and Buildings | 137,276 | 62,540 | | Of which: Acquisition of Machinery and Equipment | 1,033 | 1,158 | - Capital commitments significantly increased, primarily for the expansion of the Vietnam factory[102](index=102&type=chunk)[104](index=104&type=chunk) [Contingent Liabilities](index=82&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group provided guarantees to financial institutions for certain debts of independent third-party customers in mainland China, with a maximum guarantee amount of **$21.7 million** and guarantees issued totaling **$5.2 million** Guarantees Provided to Customers | Bank | Maximum Guarantee Amount as of June 30, 2025 (USD '000) | Guarantees Issued as of June 30, 2025 (USD '000) | | :--- | :--- | :--- | | Bank A | 7,683 | 596 | | Bank B | 13,969 | 4,621 | | Total | 21,652 | 5,217 | - The Group provided guarantees to financial institutions for certain debts of independent third-party customers in mainland China, with the maximum risk limited to the financing granted to individual customers[370](index=370&type=chunk)

(Incorporated in Bermuda with limited liability) 2025 Stock Code 股份代號 : 1201 ( 於百慕達註冊成立之有限公司 ) CORPORATE INFORMATION 企業資料 EXECUTIVE DIRECTORS Mr. Wei Mingren (Chairman) Mr. Wei Qingwen Mr. Chan Wei Ms. Yu Xiaolei Mr. Yan Haiting (resigned on 1 March 2025) Mr. Xu Qian (appointed on 10 January 2025 and resigned on 1 March 2025) INDEPENDENT NON-EXECUTIVE DIRECTORS INTERIM REPORT 中期報告 CONTENTS 目錄 | Corporate Information | 企業資料 | 2 | | --- | --- | --- | | Condensed Consolidated Statement of Profi t or | 簡明綜合損益及 ...

Linklogis Inc. 聯易融科技集團 (於開曼群島註冊成立以不同投票權控制的有限公司) 股份代號 : 9959 2025 中期報告 | 公司資料 | 2 | | --- | --- | | 主要摘要 | 4 | | 董事長報告 | 7 | | 管理層討論及分析 | 14 | | 企業管治 | 28 | | 其他資料 | 31 | | 獨立審閱報告 | 40 | | 綜合損益及其他全面收益表 | 41 | | 綜合財務狀況表 | 43 | | 綜合權益變動表 | 45 | | 綜合現金流量表 | 46 | | 未經審核中期財務報告附註 | 47 | 釋義 87 1 聯易融科技集團 • 二零二五中期報告 目錄 公司資料 | 執行董事 | | --- | | （董事長兼首席執行官） 宋群先生 | | 冀坤先生 | | 周家瓊女士 | | 非執行董事 | | 林海峰先生 | | 張予焓先生 | | 獨立非執行董事 | | 高峰先生 | | 陳懷林先生 | | 陳瑋先生 | | 審核委員會 | | （主席） 陳懷林先生 | | 高峰先生 | | 陳瑋先生 | | 薪酬委員會 | 高峰先生 （主席） 宋群先生 陳 ...