[Company Information](index=3&type=section&id=Company%20Information) This section details the company's board composition, committee structures, and lists key professional advisors and contact information [Board Composition](index=3&type=section&id=Board%20Composition) This chapter lists the members of the company's board of directors, including executive, non-executive, and independent non-executive directors, noting appointment/resignation dates for some - Executive Directors include Mr. Lin Weiguo (Chairman), Mr. Tian Meitan (CEO), Ms. Zhao Chengmin, and Mr. Xu Yixuan[4](index=4&type=chunk) - Non-executive Director Mr. Xu Xiaoxi was appointed on May 13, 2025, while Mr. Huang Wenzhou and Mr. Zheng Yongda resigned on the same day[4](index=4&type=chunk) - Independent Non-executive Directors include Mr. Huang Wei, Mr. Huang Daren, Mr. Chen Zhenyi, and Mr. Dai Yiyi[5](index=5&type=chunk) [Committee Composition](index=3&type=section&id=Committee%20Composition) This chapter details the membership of the company's Audit, Remuneration, and Nomination Committees, identifying the chairman for each - The Audit Committee is chaired by Mr. Huang Wei, with members including Mr. Huang Daren, Mr. Chen Zhenyi, and Mr. Dai Yiyi[5](index=5&type=chunk) - The Remuneration Committee is chaired by Mr. Huang Daren, with members including Mr. Huang Wei, Mr. Chen Zhenyi, and Mr. Dai Yiyi[5](index=5&type=chunk) - The Nomination Committee is chaired by Mr. Lin Weiguo, with members including Mr. Chen Zhenyi, Mr. Huang Wei, Mr. Huang Daren, and Mr. Dai Yiyi[7](index=7&type=chunk) [Professional Advisors and Offices](index=4&type=section&id=Professional%20Advisors%20and%20Offices) This chapter lists the company's independent auditor, principal bankers, registered office, main operating locations, share registrar, legal counsel, stock code, and website - The independent auditor is Grant Thornton Hong Kong Limited[8](index=8&type=chunk) - Principal bankers include Agricultural Bank of China, Bank of China, Bank of Communications, China CITIC Bank, China Construction Bank, China Merchants Bank, Industrial and Commercial Bank of China, Industrial Bank, Postal Savings Bank of China, and Shanghai Pudong Development Bank[8](index=8&type=chunk) - The company's stock code is **1908**, and its official website is www.cndintl.com[11](index=11&type=chunk) [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=6&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) This section presents the interim condensed consolidated statement of profit or loss and other comprehensive income, highlighting key financial performance metrics [Profit or Loss Performance](index=6&type=section&id=Profit%20or%20Loss%20Performance) For the six months ended June 30, 2025, the Group's revenue increased by 4.3% year-on-year to RMB 34.16 billion, and gross profit increased by 12.8% to RMB 4.40 billion. Profit for the period grew by 4.7% to RMB 1.50 billion, with profit attributable to equity holders of the Company increasing by 11.8% to RMB 910 million Key Data from Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 34,164,664 | 32,753,303 | | Cost of sales | (29,762,390) | (28,850,554) | | Gross profit | 4,402,274 | 3,902,749 | | Other income | 354,150 | 409,133 | | Loss on fair value change of investment properties | (34,849) | (1,369) | | Administrative expenses | (986,783) | (926,748) | | Selling expenses | (1,392,190) | (1,436,784) | | Finance costs | (466,897) | (266,707) | | Profit before income tax | 2,254,661 | 2,007,694 | | Income tax expense | (750,096) | (571,216) | | Profit for the period | 1,504,565 | 1,436,478 | | Profit attributable to equity holders of the Company | 913,748 | 817,068 | | Basic earnings per share (RMB cents) | 48.09 | 47.30 | | Diluted earnings per share (RMB cents) | 45.18 | 42.95 | - Total comprehensive income for the period was **RMB 1,538,636 thousand**, an increase from **RMB 1,408,741 thousand** in the prior year period[15](index=15&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=8&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) This section presents the interim condensed consolidated statement of financial position, outlining the Group's assets, liabilities, and equity at the reporting date [Assets and Liabilities Overview](index=8&type=section&id=Assets%20and%20Liabilities%20Overview) As of June 30, 2025, the Group's total assets reached RMB 443.93 billion, a 7.62% increase from the end of 2024. Both non-current and current assets grew, with properties under development increasing significantly. Total liabilities rose by 8.69% to RMB 336.93 billion, while total equity increased by 4.39% to RMB 107.00 billion Key Data from Interim Condensed Consolidated Statement of Financial Position | Indicator | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Non-current assets | 38,169,696 | 35,098,138 | | Current assets | 405,762,687 | 377,385,247 | | **Total assets** | **443,932,383** | **412,483,385** | | Current liabilities | 258,166,809 | 231,144,664 | | Non-current liabilities | 78,764,449 | 78,833,828 | | **Total liabilities** | **336,931,258** | **309,978,492** | | Equity attributable to owners of the Company | 38,507,230 | 37,559,870 | | Non-controlling interests | 68,493,895 | 64,945,023 | | **Total equity** | **107,001,125** | **102,504,893** | - Properties under development increased from **RMB 223,028,034 thousand** at the end of 2024 to **RMB 243,923,464 thousand** as of June 30, 2025[16](index=16&type=chunk) - Contract liabilities increased from **RMB 159,457,346 thousand** at the end of 2024 to **RMB 184,410,331 thousand** as of June 30, 2025[17](index=17&type=chunk) [Interim Condensed Consolidated Statement of Changes in Equity](index=11&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) This section presents the interim condensed consolidated statement of changes in equity, detailing movements in equity components over the reporting period [Analysis of Changes in Equity](index=11&type=section&id=Analysis%20of%20Changes%20in%20Equity) This chapter details the changes in equity for the six months ended June 30, 2025. Total comprehensive income for the period was RMB 1,538,636 thousand, including profit attributable to equity holders of RMB 913,748 thousand. Significant contributions came from non-controlling interests, and the 2024 final dividend was settled in cash and new shares - As of June 30, 2025, total equity was **RMB 107,001,125 thousand**, an increase from **RMB 102,504,893 thousand** as of January 1, 2025[22](index=22&type=chunk) - Total comprehensive income for the period was **RMB 1,538,636 thousand**, comprising profit for the period of **RMB 1,504,565 thousand** and currency translation differences of **RMB 34,071 thousand**[22](index=22&type=chunk) - Capital contributions from non-controlling interests amounted to **RMB 3,381,372 thousand**, significantly contributing to total equity[22](index=22&type=chunk) - The 2024 final dividend was settled with approximately **RMB 318,081 thousand** in cash and the issuance of new shares totaling approximately **RMB 1,887,775 thousand**[22](index=22&type=chunk)[23](index=23&type=chunk) [Interim Condensed Consolidated Statement of Cash Flows](index=13&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This section presents the interim condensed consolidated statement of cash flows, detailing cash movements from operating, investing, and financing activities [Cash Flow Analysis](index=13&type=section&id=Cash%20Flow%20Analysis) For the six months ended June 30, 2025, the Group generated net cash inflow from operating activities of RMB 12.03 billion, compared to a net outflow in the prior year. Net cash outflow from investing activities was RMB 12.45 billion, and net cash outflow from financing activities was RMB 530 million. Cash and cash equivalents at period-end totaled RMB 53.29 billion Key Data from Interim Condensed Consolidated Statement of Cash Flows | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Net cash from/(used in) operating activities | 12,031,348 | (3,411,876) | | Net cash (used in)/from investing activities | (12,448,840) | 811,866 | | Net cash used in financing activities | (529,193) | (2,268,153) | | Net decrease in cash and cash equivalents | (946,685) | (4,868,163) | | Cash and cash equivalents as of June 30 | 53,294,875 | 46,255,626 | - Cash used in financing activities for repayment of interest-bearing borrowings, indirect holding company loans, and amounts due to non-controlling interests was approximately **RMB 123,521.16 million**, an increase from approximately **RMB 117,912.22 million** in the prior year period[25](index=25&type=chunk) [Notes to the Unaudited Interim Condensed Consolidated Financial Information](index=14&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section provides detailed notes to the unaudited interim condensed consolidated financial information, explaining the basis of preparation, significant accounting policies, and specific financial items [1. General Information](index=14&type=section&id=1.%20General%20Information) This note clarifies that the interim financial information is presented in RMB thousands, despite the functional currency being HKD, and identifies the company's direct, indirect, and ultimate holding companies - The interim financial information is presented in **RMB thousands**, while the Company's functional currency is **HKD**[26](index=26&type=chunk)[29](index=29&type=chunk) - The Company's ultimate holding company is Xiamen C&D Group Co., Ltd[27](index=27&type=chunk)[30](index=30&type=chunk) [2. Basis of Preparation](index=14&type=section&id=2.%20Basis%20of%20Preparation) This note states that the interim financial information is prepared in accordance with HKAS 34 and Appendix D2 of the Listing Rules, and should be read in conjunction with the Group's annual consolidated financial statements for the year ended December 31, 2024 - The interim financial information has been prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of Appendix D2 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[28](index=28&type=chunk)[31](index=31&type=chunk) - The interim financial information should be read in conjunction with the Group's annual consolidated financial statements for the year ended December 31, 2024[28](index=28&type=chunk)[32](index=32&type=chunk) [3. Adoption of New and Revised Hong Kong Financial Reporting Standards ("HKFRSs")](index=15&type=section&id=3.%20Adoption%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards%20(%22HKFRSs%22)) This note explains the Group's adoption of new and revised HKFRSs on January 1, 2025, including HKAS 21 (Amendment) "Lack of Exchangeability," which had no material impact on current or prior period results. It also lists standards issued but not yet effective, which are also not expected to have a significant impact - The Group adopted new and revised HKFRSs on January 1, 2025, including HKAS 21 (Amendment) 'Lack of Exchangeability'[33](index=33&type=chunk)[35](index=35&type=chunk) - The adoption of new and revised HKFRSs had no material impact on the preparation and presentation of the results and financial position for the current and prior periods[35](index=35&type=chunk) - HKFRSs issued but not yet effective include HKFRS 18, HKFRS 19, and amendments to HKFRS 9, which are not expected to have a significant impact on the Group's consolidated financial statements[37](index=37&type=chunk)[39](index=39&type=chunk) [4. Revenue and Segment Information](index=17&type=section&id=4.%20Revenue%20and%20Segment%20Information) This note explains that the Group determines operating segments based on reports reviewed by the chief operating decision-maker, primarily engaging in property development, property management, and related services. Most of the Group's revenue and results are from the China market. Revenue is analyzed by business type and recognition timing - The Group primarily engages in property development, property management, and other related services, identified as a single segment[42](index=42&type=chunk) - The majority of the Group's revenue and results are derived from the China market, hence no geographical information is presented[43](index=43&type=chunk) Group Revenue Analysis | Revenue Source | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Property development | 32,143,307 | 31,010,852 | | Property management and other related services | 2,021,357 | 1,742,451 | | **Total** | **34,164,664** | **32,753,303** | Revenue Recognition Timing Analysis | Revenue Recognition Timing | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | At a point in time | 32,213,056 | 31,121,612 | | Over a period of time | 1,951,608 | 1,631,691 | | **Total** | **34,164,664** | **32,753,303** | [5. Other Income](index=19&type=section&id=5.%20Other%20Income) This note lists the components of the Group's other income, primarily including bank interest income, interest income from loans to associates and joint ventures, compensation income, government grants, and sundry income. Total other income for the period was RMB 354,150 thousand, a decrease from the prior year Other Income Details | Other Income Source | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Bank interest income | 249,468 | 318,965 | | Interest income from loans to associates | 24,099 | 20,080 | | Interest income from loans to joint ventures | 7,359 | 11,261 | | Compensation income | 21,185 | 16,492 | | Government grants | 10,285 | 11,246 | | Fair value change (loss)/gain on financial assets at fair value through profit or loss | (4,000) | 1,000 | | Sundry income | 28,063 | 25,240 | | **Total** | **354,150** | **409,133** | [6. Finance Costs](index=20&type=section&id=6.%20Finance%20Costs) This note provides a detailed analysis of the Group's finance costs, including interest expenses on bank borrowings, indirect holding company loans, amounts due to non-controlling shareholders and related companies, and the significant financing component of contract liabilities. Total borrowing costs were RMB 3,253,739 thousand, with net finance costs of RMB 466,897 thousand after deducting capitalized interest Finance Costs Details | Finance Cost Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest expense on bank borrowings | 399,215 | 502,061 | | Interest expense on indirect holding company loans | 960,110 | 1,029,169 | | Amounts due to non-controlling shareholders | 95,341 | 37,052 | | Amounts due to associates | 39,260 | 16,077 | | Amounts due to joint ventures | 8,025 | 3,742 | | Significant financing component of contract liabilities | 1,750,473 | 2,509,394 | | Finance costs on lease liabilities | 1,315 | 2,828 | | **Total borrowing costs** | **3,253,739** | **4,100,323** | | Less: Capitalized interest | (2,786,842) | (3,833,616) | | **Finance costs** | **466,897** | **266,707** | - Borrowing costs were capitalized at applicable annual interest rates ranging from **0.95% to 10.0%** (prior year period: **1.30% to 10.0%** per annum)[52](index=52&type=chunk) [7. Profit Before Income Tax](index=21&type=section&id=7.%20Profit%20Before%20Income%20Tax) This note lists the various expenses and income deducted or included in the calculation of profit before income tax, such as cost of properties sold, depreciation, expected credit loss provisions, net foreign exchange losses, and property inventory provisions Items for Profit Before Income Tax Calculation | Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Cost of properties sold | 28,244,621 | 27,441,170 | | Depreciation: owned assets | 13,490 | 16,294 | | Depreciation: right-of-use assets | 57,732 | 36,766 | | Provision for/(reversal of) expected credit losses on loans to associates and joint ventures | 20,629 | (65,225) | | Reversal of expected credit losses on trade and other receivables | (4,646) | (29,753) | | Provision for expected credit losses on amounts due from non-controlling interests | 4,003 | 5,086 | | Net foreign exchange loss/(gain) | 9,728 | (2,837) | | Provision for property inventories and other contract costs | 392,815 | 284,937 | [8. Income Tax Expense](index=22&type=section&id=8.%20Income%20Tax%20Expense) This note details the Group's income tax expense, primarily comprising China corporate income tax, China land appreciation tax, and deferred tax. For the six months ended June 30, 2025, total income tax expense was RMB 750,096 thousand, an increase from the prior year. No Hong Kong profits tax provision was made, and China corporate income tax is calculated at a 25% rate Income Tax Expense Details | Income Tax Expense Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | China Corporate Income Tax ("CIT") — Current | 1,731,246 | 1,009,099 | | China Land Appreciation Tax ("LAT") | 100,665 | 160,112 | | Deferred tax | (1,081,815) | (597,995) | | **Total income tax expense** | **750,096** | **571,216** | - The Group did not generate any assessable profits in Hong Kong for the six months ended June 30, 2025 and 2024, thus no provision for Hong Kong profits tax was made[57](index=57&type=chunk) - China corporate income tax is provided at a rate of **25%**, and China land appreciation tax is calculated at progressive rates ranging from **30% to 60%**[57](index=57&type=chunk)[59](index=59&type=chunk) [9. Dividends](index=23&type=section&id=9.%20Dividends) This note states that the Board of Directors resolved not to declare an interim dividend for the current period, consistent with the prior year - The Board of Directors has resolved not to declare an interim dividend for the current period (prior year period: nil)[58](index=58&type=chunk)[63](index=63&type=chunk) [10. Earnings Per Share](index=24&type=section&id=10.%20Earnings%20Per%20Share) This note details the calculation methods and results for both basic and diluted earnings per share. As of June 30, 2025, basic earnings per share was RMB 48.09 cents, and diluted earnings per share was RMB 45.18 cents Basic Earnings Per Share Calculation | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Profit attributable to equity holders of the Company | 913,748 | 817,068 | | Weighted average number of ordinary shares in issue during the period (thousand shares) | 1,899,953 | 1,727,565 | | **Earnings per share (expressed in RMB cents per share)** | **48.09** | **47.30** | Diluted Earnings Per Share Calculation | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Profit attributable to equity holders of the Company for diluted EPS calculation | 910,394 | 813,813 | | Weighted average number of ordinary shares for diluted EPS calculation (thousand shares) | 2,014,875 | 1,894,991 | | **Earnings per share (expressed in RMB cents per share)** | **45.18** | **42.95** | - The restricted shares granted by the Company have a potential dilutive effect on earnings per share, which has been adjusted in the diluted earnings per share calculation[68](index=68&type=chunk)[69](index=69&type=chunk) [11. Investment Properties](index=26&type=section&id=11.%20Investment%20Properties) This note outlines the changes in the carrying amount of investment properties, including fair value changes and transfers from completed properties held for sale. As of June 30, 2025, the carrying amount of investment properties was RMB 3,016,927 thousand, with some properties pledged. The note also details the valuation process, methodology, and fair value hierarchy, with all investment properties classified as Level 3 Changes in Carrying Amount of Investment Properties | Change Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Carrying amount as of January 1 | 2,778,052 | 1,668,273 | | Fair value change of investment properties | (34,849) | (364,658) | | Transfer from completed properties held for sale | 273,724 | 1,469,572 | | **Carrying amount as of period-end** | **3,016,927** | **2,778,052** | - As of June 30, 2025, investment properties with a fair value of **RMB 623,000 thousand** were pledged to banks to secure the Group's bank borrowings[73](index=73&type=chunk)[74](index=74&type=chunk) - The fair value of investment properties is determined by independent professional qualified valuers using the direct capitalization approach or income approach, and is classified as Level 3 of the fair value hierarchy[78](index=78&type=chunk)[79](index=79&type=chunk)[83](index=83&type=chunk)[85](index=85&type=chunk)[86](index=86&type=chunk) [12. Other Financial Assets](index=32&type=section&id=12.%20Other%20Financial%20Assets) This note discloses the Group's other non-current financial assets, primarily unlisted equity securities measured at fair value through profit or loss. As of June 30, 2025, these assets amounted to RMB 107,877 thousand Other Financial Assets Details | Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Financial assets at fair value through profit or loss: Unlisted equity securities | 107,877 | 111,538 | [13. Properties Under Development, Other Inventories and Other Contract Costs](index=33&type=section&id=13.%20Properties%20Under%20Development%2C%20Other%20Inventories%20and%20Other%20Contract%20Costs) This note provides a detailed classification of properties under development, properties held for sale, other inventories, and other contract costs. As of June 30, 2025, properties under development and properties held for sale totaled RMB 263,501,675 thousand. Some properties under development are pledged, and capitalized contract costs primarily consist of sales commissions Properties Under Development, Other Inventories and Other Contract Costs Details | Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Properties under development | 243,923,464 | 223,028,034 | | Properties held for sale | 19,578,211 | 21,739,904 | | Other inventories | 207,958 | 235,345 | | Other contract costs | 2,483,833 | 2,026,697 | | **Total** | **266,193,466** | **247,029,980** | | Less: Inventory provision | (4,930,736) | (5,754,234) | - As of June 30, 2025, properties under development with a carrying amount of **RMB 23,733,157 thousand** were pledged to banks to secure the Group's bank borrowings[97](index=97&type=chunk) - Capitalized contract costs primarily represent incremental sales commissions paid to property agents, with **RMB 453,840 thousand** recognized in profit or loss during the period[98](index=98&type=chunk) [14. Trade and Other Receivables](index=34&type=section&id=14.%20Trade%20and%20Other%20Receivables) This note presents the composition of the Group's trade and other receivables, including amounts due from third parties, related parties, deposits, prepayments, and VAT receivables, net of loss allowances. As of June 30, 2025, total trade and other receivables amounted to RMB 17,081,217 thousand. The note also provides an aging analysis of trade receivables and changes in loss allowances Trade and Other Receivables Details | Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade receivables (net of loss allowance) | 3,026,920 | 3,232,006 | | Other receivables (net of loss allowance) | 14,054,297 | 12,903,720 | | **Total** | **17,081,217** | **16,135,726** | Aging Analysis of Trade Receivables (Net of Loss Allowance) | Aging | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | 0 to 30 days | 262,881 | 1,840,753 | | 31 to 90 days | 192,930 | 7,355 | | 91 to 180 days | 195,265 | 444,524 | | 181 to 365 days | 1,750,168 | 165,538 | | Over 1 year | 625,676 | 773,836 | | **Total** | **3,026,920** | **3,232,006** | - Loss allowance for trade receivables decreased by **RMB 10,205 thousand** during the period, while loss allowance for other receivables increased by **RMB 5,559 thousand**[102](index=102&type=chunk)[105](index=105&type=chunk) [15. Bank and Cash Balances](index=37&type=section&id=15.%20Bank%20and%20Cash%20Balances) This note presents the Group's bank and cash balances and restricted bank deposits. As of June 30, 2025, the total amounted to RMB 56,255,461 thousand. Most bank balances are denominated in RMB and held in China, subject to foreign exchange control regulations. Restricted bank deposits primarily serve as guarantee deposits for pre-sold properties under construction Bank and Cash Balances Details | Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Bank and cash balances | 53,294,875 | 54,245,647 | | Restricted bank deposits | 2,960,586 | 3,013,506 | | **Total** | **56,255,461** | **57,259,153** | - Bank balances of **RMB 56,049,923 thousand** are denominated in RMB and held in banks in China, where RMB is not freely convertible[108](index=108&type=chunk)[110](index=110&type=chunk) - Restricted bank deposits primarily represent guarantee deposits for pre-sold properties under construction, which can only be used to pay construction costs upon approval from relevant government authorities[109](index=109&type=chunk)[111](index=111&type=chunk) [16. Trade and Other Payables](index=38&type=section&id=16.%20Trade%20and%20Other%20Payables) This note provides a detailed classification of the Group's trade and other payables. As of June 30, 2025, trade payables amounted to RMB 25,887,266 thousand, and other payables totaled RMB 6,130,663 thousand, with a grand total of RMB 32,017,929 thousand. The note also includes an aging analysis of trade payables Trade and Other Payables Details | Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade payables | 25,887,266 | 25,851,482 | | Advances received and other payables | 165,233 | 108,085 | | Accrued interest | 28,923 | 28,586 | | Accrued salaries | 416,149 | 955,979 | | VAT payable | 373,918 | 938,856 | | Deposits received | 820,103 | 717,576 | | Accrued expenses | 2,220,834 | 2,111,069 | | Collections and payments on behalf of others | 877,267 | 934,285 | | Payables for restricted share incentive scheme | 882,169 | 1,084,739 | | Dividends payable | 346,067 | – | | **Total** | **32,017,929** | **32,730,657** | Aging Analysis of Trade Payables | Aging | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | 0 to 30 days | 12,093,181 | 16,515,253 | | 31 to 60 days | 3,786,806 | 1,997,491 | | 61 to 90 days | 1,162,549 | 1,138,791 | | Over 90 days | 8,844,730 | 6,199,947 | | **Total** | **25,887,266** | **25,851,482** | [17. Amounts Due from/(to) Related Companies/Non-controlling Interests/Indirect Holding Company Loans](index=40&type=section&id=17.%20Amounts%20Due%20from%2F(to)%20Related%20Companies%2FNon-controlling%20Interests%2FIndirect%20Holding%20Company%20Loans) This note details the Group's receivables from/payables to related parties and indirect holding company loans. As of June 30, 2025, net amounts due from non-controlling interests were RMB 52,684,641 thousand, amounts due to related companies were RMB 22,172,561 thousand, and indirect holding company loans were RMB 45,328,009 thousand. Some amounts are interest-bearing, and indirect holding company loans are unsecured Related Party Balances Details | Item | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Amounts due from non-controlling interests (net of loss allowance) | 52,684,641 | 48,685,189 | | Amounts due to related companies | 22,172,561 | 21,355,737 | | Amounts due to non-controlling interests | 7,833,977 | 6,996,648 | | Indirect holding company loans (non-current liabilities) | 45,328,009 | 50,752,538 | - Amounts due from non-controlling interests of **RMB 651,634 thousand** bear interest at annual rates ranging from **1.92% to 6.5%**; amounts due to non-controlling interests of **RMB 1,670,006 thousand** bear interest at annual rates ranging from **3.5% to 10%**[120](index=120&type=chunk)[123](index=123&type=chunk) - Indirect holding company loans are unsecured, bear interest at an effective annual rate of **4.06%** (December 31, 2024: **4.45%**), and are not repayable within one year[121](index=121&type=chunk)[124](index=124&type=chunk) - Loss allowance for amounts due from non-controlling interests increased by **RMB 4,003 thousand** to **RMB 52,737 thousand** during the period[127](index=127&type=chunk) [18. Interest-Bearing Borrowings](index=43&type=section&id=18.%20Interest-Bearing%20Borrowings) This note provides detailed information on the Group's interest-bearing borrowings, including secured and unsecured bank loans and their repayment terms. As of June 30, 2025, total bank loans amounted to RMB 41,111,718 thousand, mostly secured by properties under development and investment properties, with unsecured portions guaranteed by holding companies Interest-Bearing Borrowings Details | Borrowing Type | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Bank loans — Secured | 6,644,137 | 6,821,723 | | Bank loans — Unsecured | 34,467,581 | 26,925,174 | | **Total bank loans** | **41,111,718** | **33,746,897** | Bank Loan Repayment Schedule | Repayment Period | As of June 30, 2025 (RMB thousands) | As of December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within one year or on demand | 8,100,151 | 6,124,502 | | In the second year | 12,136,868 | 11,201,871 | | In the third to fifth year | 20,593,008 | 16,127,149 | | After the fifth year | 281,691 | 293,375 | | **Total** | **41,111,718** | **33,746,897** | - Bank loans are secured by properties under development with a carrying amount of approximately **RMB 23,733,157 thousand** and investment properties with a fair value of approximately **RMB 623,000 thousand**[132](index=132&type=chunk)[134](index=134&type=chunk) - Unsecured borrowings are guaranteed by C&D Inc., C&D Real Estate, and certain non-controlling interests, with bank loans bearing interest at effective annual rates ranging from **0.95% to 3.05%**[135](index=135&type=chunk)[136](index=136&type=chunk) [19. Share Capital](index=45&type=section&id=19.%20Share%20Capital) This note describes the Company's authorized and issued share capital. As of June 30, 2025, the issued and fully paid share capital consisted of 2,017,177,631 ordinary shares of HKD 0.1 each, amounting to RMB 174,233 thousand Share Capital Details | Item | Number of Shares | Amount (RMB thousands) | | :--- | :--- | :--- | | Authorized share capital (ordinary shares of HKD 0.1 each) | 3,000,000,000 | 254,870 | | Issued and fully paid share capital (ordinary shares of HKD 0.1 each) | 2,017,177,631 | 174,233 | [20. Significant Related Party Transactions](index=46&type=section&id=20.%20Significant%20Related%20Party%20Transactions) This note discloses significant transactions between the Group and related parties, including interest expenses on indirect holding company loans, interest income/expenses on loans to associates and joint ventures, procurement of raw materials from indirect holding companies, and construction management fees received. It also lists key management personnel compensation Significant Related Party Transactions Details | Nature of Transaction | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest expense on indirect holding company loans | 960,110 | 1,029,169 | | Interest income from loans to associates | (24,099) | (20,080) | | Interest expense on loans to associates | 39,260 | 16,077 | | Interest income from loans to joint ventures | (7,359) | (11,261) | | Construction management fees received from fellow subsidiaries | 9,897 | 11,032 | | Raw materials procured from indirect holding companies | 103,898 | 201,918 | - Indirect holding company C&D Real Estate agreed to provide loan financing of up to **RMB 60,000 million** for project development, at an annual interest rate of **4.06%** (prior year period: **4.45%**)[142](index=142&type=chunk) Key Management Personnel Compensation | Compensation Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Basic salaries and allowances | 6,542 | 6,398 | | Contributions to retirement benefit schemes | 140 | 122 | | Share-based payments | 3,000 | 5,768 | | **Total** | **9,682** | **12,288** | [21. Events After the Reporting Period](index=48&type=section&id=21.%20Events%20After%20the%20Reporting%20Period) This note discloses two significant post-reporting period events: the company allotted and issued 158,376,501 ordinary shares on July 8, 2025, under a scrip dividend scheme, and issued 64,600,000 ordinary shares on August 5, 2025, under a placing and subscription agreement - On July 8, 2025, the Company allotted and issued **158,376,501** ordinary shares under a scrip dividend scheme[146](index=146&type=chunk)[148](index=148&type=chunk) - On August 5, 2025, the Company issued a total of **64,600,000** ordinary shares under a placing and subscription agreement dated July 22, 2025[147](index=147&type=chunk)[149](index=149&type=chunk) [Management Discussion and Analysis](index=49&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's discussion and analysis of the Group's financial performance, operational review, and future outlook, including market conditions and strategic initiatives [Market Review](index=49&type=section&id=Market%20Review) In the first half of 2025, the domestic and international economic situation was complex, and the real estate market was still in the process of stabilizing, with national new commercial housing sales decreasing by 5.5% year-on-year. Industry differentiation intensified, with demand for improved housing in core areas becoming mainstream, and customers demanding higher quality, intelligence, green features, and digitalization, shifting corporate competition towards products, brands, technology, and supply chains - In the first half of 2025, national new commercial housing sales reached **RMB 4,424.1 billion**, a year-on-year decrease of **5.5%**, marking the lowest level in nearly four years[150](index=150&type=chunk)[151](index=151&type=chunk) - The differentiation trend in the real estate industry became more pronounced, with demand for improved housing in core areas becoming the current mainstream, and customers demanding higher quality, location, functionality, environment, amenities, and services[150](index=150&type=chunk)[151](index=151&type=chunk) - Intelligent, green, and digital features have become industry development trends, and competition among real estate enterprises has shifted towards products, brands, technology, and supply chains[152](index=152&type=chunk) [Business Review](index=49&type=section&id=Business%20Review) The Group primarily engages in property development, real estate industry chain investment services, and emerging industry investments. During the period, total revenue was approximately RMB 34.16 billion, a year-on-year increase of 4.3%; gross profit was approximately RMB 4.40 billion, a year-on-year increase of 12.8%; and profit attributable to equity holders of the Company was approximately RMB 910 million, a year-on-year increase of 11.8% - The Group primarily engages in property development, real estate industry chain investment services, and emerging industry investments, with property development being the main source of revenue[154](index=154&type=chunk) Key Business Financial Data for the Period | Indicator | H1 2025 (RMB billions) | H1 2024 (RMB billions) | Y-o-Y Growth (%) | | :--- | :--- | :--- | :--- | | Revenue | 341.6 | 327.5 | 4.3% | | Gross profit | 44.0 | 39.0 | 12.8% | | Profit attributable to equity holders of the Company | 9.1 | 8.2 | 11.8% | [Property Development Business](index=50&type=section&id=Property%20Development%20Business) The Group's property development business revenue accounted for 94.1% of total revenue, reaching RMB 32.14 billion in the current period, a year-on-year increase. Despite a decrease in total GFA delivered, higher average selling prices in certain cities drove revenue growth. Contracted sales increased by 4.9% year-on-year to RMB 53.35 billion, but GFA attributable to shareholders from contracted sales decreased by 18.4%. As of June 30, 2025, land reserves available for sale totaled approximately 12.71 million square meters - Revenue from property development business reached approximately **RMB 32.14 billion**, an increase of approximately **RMB 1.13 billion** year-on-year, accounting for approximately **94.1%** of the Group's total revenue[157](index=157&type=chunk)[158](index=158&type=chunk) - Total gross floor area of properties delivered was approximately **1.901 million square meters**, a decrease of approximately **0.151 million square meters** from the prior year period, but property development revenue still increased due to higher average selling prices per square meter for properties delivered in certain cities[157](index=157&type=chunk)[158](index=158&type=chunk)[179](index=179&type=chunk) - The Group, together with its joint ventures and associates, achieved cumulative contracted sales attributable to the Company's shareholders of approximately **RMB 53.35 billion**, a year-on-year increase of approximately **4.9%**[163](index=163&type=chunk)[164](index=164&type=chunk) - Cumulative contracted sales GFA attributable to shareholders was approximately **2.008 million square meters**, a year-on-year decrease of approximately **18.4%**[163](index=163&type=chunk)[164](index=164&type=chunk) - As of June 30, 2025, the Group's land reserves available for sale in China amounted to approximately **12.71 million square meters**[169](index=169&type=chunk) [Financial Review](index=56&type=section&id=Financial%20Review) During the period, the Group's revenue grew by 4.3% to RMB 34.16 billion, with property development accounting for 94.08% and property management and other related services growing by 16.0%. Gross profit margin improved to 12.89%, mainly due to higher margins from certain delivered projects. Other income decreased due to lower bank interest. Total borrowing costs decreased due to a slight reduction in average financing interest rates. Fair value changes of investment properties recorded a loss. Administrative expenses increased due to higher property inventory provisions, while selling expenses decreased due to reduced sales-related staff costs. Profit before income tax increased by 12.3% to RMB 2.25 billion, and profit attributable to equity holders of the Company increased by 11.8% to RMB 910 million Revenue Segments and Proportions | Revenue Segment | For the six months ended June 30, 2025 (RMB thousands) | Proportion (%) | For the six months ended June 30, 2024 (RMB thousands) | Proportion (%) | | :--- | :--- | :--- | :--- | :--- | | Property development | 32,143,307 | 94.08 | 31,010,852 | 94.68 | | Property management and other related services | 2,021,357 | 5.92 | 1,742,451 | 5.32 | | **Total** | **34,164,664** | **100.00** | **32,753,303** | **100.00** | - Revenue from property management and other related services increased by **16.0%** to approximately **RMB 2.02 billion**, with GFA under management reaching approximately **83.3 million square meters**[177](index=177&type=chunk)[180](index=180&type=chunk) - Gross profit margin increased from **11.92%** in the prior year period to **12.89%** in the current period, mainly due to higher gross profit margins from certain delivered projects[181](index=181&type=chunk)[185](index=185&type=chunk) - Total borrowing costs (excluding the significant financing component of contract liabilities and finance costs on lease liabilities) decreased to approximately **RMB 1.50 billion**, mainly due to a slight decrease in the average financing interest rate[183](index=183&type=chunk)[188](index=188&type=chunk) - Administrative expenses increased by approximately **RMB 60 million** to approximately **RMB 990 million**, mainly due to increased provision for property inventories during the period[191](index=191&type=chunk)[196](index=196&type=chunk) - Selling expenses decreased by approximately **RMB 50 million** to approximately **RMB 1.39 billion**, mainly due to reduced sales-related staff costs during the period[192](index=192&type=chunk)[197](index=197&type=chunk) - Profit before income tax was approximately **RMB 2.25 billion**, an increase of approximately **RMB 240 million** from the prior year period[193](index=193&type=chunk)[198](index=198&type=chunk) - Profit attributable to equity holders of the Company was approximately **RMB 910 million**, a year-on-year increase of **11.8%**[195](index=195&type=chunk)[200](index=200&type=chunk) [Liquidity and Financial Resources](index=59&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's liquidity position is well-managed, with bank and cash balances of approximately RMB 56.26 billion as of June 30, 2025. Both total assets and net assets increased, with working capital reaching RMB 147.60 billion. The net debt-to-equity ratio decreased to 33.37%, mainly due to increased contributions from non-controlling interests. Of the total borrowings, approximately RMB 13.63 billion is repayable within one year - As of June 30, 2025, the Group's bank and cash balances were approximately **RMB 56.26 billion** (December 31, 2024: approximately **RMB 57.26 billion**)[202](index=202&type=chunk)[204](index=204&type=chunk) - Total assets were approximately **RMB 443.93 billion**, and net assets (after deducting non-controlling interests) were approximately **RMB 38.51 billion**[202](index=202&type=chunk)[204](index=204&type=chunk) - Working capital reached approximately **RMB 147.60 billion**[202](index=202&type=chunk)[204](index=204&type=chunk) - The net debt-to-equity ratio was approximately **33.37%** (December 31, 2024: approximately **31.78%**), and the gearing ratio decreased to approximately **85.9%** (December 31, 2024: approximately **87.6%**), mainly due to increased contributions from non-controlling interests[202](index=202&type=chunk)[204](index=204&type=chunk)[207](index=207&type=chunk)[209](index=209&type=chunk) - Of the total borrowings, approximately **RMB 13.63 billion** is repayable within one year, and approximately **RMB 78.06 billion** is repayable after one year but within five years[210](index=210&type=chunk) [Financial Guarantee Contracts](index=61&type=section&id=Financial%20Guarantee%20Contracts) The Group's outstanding balance of bank financing guarantees provided to property unit purchasers significantly decreased, mainly because guarantees were no longer provided for mortgage loans of some newly sold property projects during the period - As of June 30, 2025, the outstanding balance of bank financing guarantees provided by the Group to property unit purchasers was approximately **RMB 21.76 billion** (December 31, 2024: approximately **RMB 43.32 billion**)[212](index=212&type=chunk)[216](index=216&type=chunk) - The decrease in guarantees was mainly due to the Group no longer providing guarantees for mortgage loans of certain newly sold property projects during the period[212](index=212&type=chunk)[216](index=216&type=chunk) [Capital Commitments](index=61&type=section&id=Capital%20Commitments) The Group's capital commitments increased to RMB 66.71 billion, primarily due to an increase in contracted but unprovided properties under development - As of June 30, 2025, the outstanding balance of capital commitments was approximately **RMB 66.71 billion** (December 31, 2024: approximately **RMB 59.97 billion**)[213](index=213&type=chunk)[217](index=217&type=chunk) - The increase was due to an increase in contracted but unprovided properties under development compared to 2024 during the period[213](index=213&type=chunk)[217](index=217&type=chunk) [Pledged Assets](index=61&type=section&id=Pledged%20Assets) The Group's bank loans are secured by investment properties with a fair value of approximately RMB 623 million and properties under development with a carrying amount of approximately RMB 23.73 billion - As of June 30, 2025, the Group's bank loans are secured by legal charges over investment properties with a fair value of approximately **RMB 623 million** and properties under development with a carrying amount of approximately **RMB 23.73 billion**[214](index=214&type=chunk)[218](index=218&type=chunk) [Capital Structure](index=61&type=section&id=Capital%20Structure) As of June 30, 2025, the Company's issued share capital consisted of 2,017,177,631 ordinary shares of HKD 0.1 each - As of June 30, 2025, the Company's issued share capital was **HKD 201,717,763.1**, divided into **2,017,177,631** ordinary shares of **HKD 0.1** each[215](index=215&type=chunk)[219](index=219&type=chunk) [Foreign Currency Risk](index=62&type=section&id=Foreign%20Currency%20Risk) The Group's operations are primarily conducted in China, with revenues and expenses mainly denominated in RMB, resulting in limited foreign exchange risk. Except for bank deposits denominated in foreign currencies (primarily HKD), the Group has no significant foreign exchange risk and did not use any financial instruments for hedging during the period - The Group's business operations are primarily conducted in China, with its revenues and expenses mainly denominated in **RMB**[221](index=221&type=chunk)[225](index=225&type=chunk) - Except for bank deposits denominated in foreign currencies (primarily **HKD**), the Group's operations have no significant foreign exchange risk, and no financial instruments were used for hedging during the period[221](index=221&type=chunk)[225](index=225&type=chunk) [Contingent Liabilities](index=62&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)[222](index=222&type=chunk)[226](index=226&type=chunk) [Significant Investments, Major Acquisitions and Disposals of Subsidiaries, Joint Ventures and Associates](index=62&type=section&id=Significant%20Investments%2C%20Major%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Joint%20Ventures%20and%20Associates) During the period, the Group held no significant investments or securities investments, nor did it undertake any major acquisitions or disposals of subsidiaries, joint ventures, and associates. As of the report date, the company also had no related future plans - During the period, the Group did not hold any significant investments or major securities investments as part of its asset portfolio, nor did it undertake any major acquisitions or disposals of subsidiaries, joint ventures, and associates[223](index=223&type=chunk)[227](index=227&type=chunk) - As of the date of this report, the Company has no future plans regarding any significant investments or capital assets[223](index=223&type=chunk)[227](index=227&type=chunk) [Events After Reporting Period](index=62&type=section&id=Events%20After%20Reporting%20Period) This section refers to details of significant events affecting the Group after the reporting period, as disclosed in Note 20 of this report - Details of significant events affecting the Group after June 30, 2025, are set out in Note 20 of this report[224](index=224&type=chunk)[228](index=228&type=chunk) [Employees and Remuneration Policy](index=63&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group employed approximately 22.4 thousand full-time employees, with total staff costs of approximately RMB 1.85 billion. The company regularly reviews its remuneration policy, provides year-end bonuses, and has adopted a restricted share incentive scheme and an online learning platform to attract, retain, and develop employees - As of June 30, 2025, the Group employed approximately **22.4 thousand** full-time employees (June 30, 2024: approximately **20.9 thousand** employees)[229](index=229&type=chunk)[231](index=231&type=chunk) - During the period, the Group's total staff costs (including directors' emoluments and share-based payments) were approximately **RMB 1.85 billion** (prior year period: approximately **RMB 1.95 billion**)[229](index=229&type=chunk)[231](index=231&type=chunk) - The Group has adopted a restricted share incentive scheme and established an online learning platform, offering various training courses to enhance employees' skills and capabilities[232](index=232&type=chunk) [Principal Risks and Uncertainties](index=63&type=section&id=Principal%20Risks%20and%20Uncertainties) The China real estate market is influenced by multiple factors, including social, political, economic, legal environments, and government policies. The Group manages these risks by implementing differentiated investment and sales strategies, cultivating multiple projects in various regional markets to reduce reliance on a single market - The China real estate market is affected by multiple factors, including changes in social, political, economic, and legal environments, as well as the implementation of government policies related to fiscal, economic, financial, industrial, and environmental aspects[230](index=230&type=chunk)[234](index=234&type=chunk) - The Group implements differentiated investment and sales strategies based on market conditions, cultivating multiple projects in various regional markets to reduce reliance on a single market[230](index=230&type=chunk)[234](index=234&type=chunk) [Outlook and Prospects](index=64&type=section&id=Outlook%20and%20Prospects) Facing intensified market differentiation and a shift in industry competition towards quality and value in 2025, the company will uphold asset health, focusing on "stable scale and stable profit." In the second half, it will accelerate inventory destocking in sales, prudently focus on core areas in investment, innovate R&D to lead quality upgrades in products, and integrate resources to enhance operational efficiency in the supply chain, aiming for healthy and sustainable development - In 2025, market differentiation continues to intensify, and industry competition has shifted from scale competition to a comprehensive contest of quality and value[236](index=236&type=chunk)[237](index=237&type=chunk) - The company will adhere to the working principle of 'stable scale and stable profit,' focusing on strengthening execution in four key areas: sales, investment, products, and supply chain[238](index=238&type=chunk) - Looking ahead, the real estate industry has entered the 'quality living era,' and the company will focus on 'better living' to create a value loop of 'good products, good services, and good life,' striving for healthy and sustainable development through refined management and continuous innovation[250](index=250&type=chunk) [Sales End: Seize Opportunities, Accelerate Inventory Destocking, Enhance Sales Quality](index=64&type=section&id=Sales%20End%3A%20Seize%20Opportunities%2C%20Accelerate%20Inventory%20Destocking%2C%20Enhance%20Sales%20Quality) This sub-section outlines strategies to improve sales quality, focus on core cities, and accelerate inventory destocking through various initiatives - The company will strive to enhance sales quality, focus on in-depth development in core cities, and increase market share[238](index=238&type=chunk) - Actively capture policy and market opportunities, timely increase prices for eligible projects, and fully ensure sales and destocking for new project launches[238](index=238&type=chunk)[239](index=239&type=chunk) - For existing projects, the Group will strengthen management control, promote various strategies such as 'rejuvenating old projects,' accelerate destocking, and expedite cash recovery[239](index=239&type=chunk) [Investment End: Prudent Investment, Focus on Core Areas, Ensure Precise Investment](index=65&type=section&id=Investment%20End%3A%20Prudent%20Investment%2C%20Focus%20on%20Core%20Areas%2C%20Ensure%20Precise%20Investment) This sub-section details the investment strategy, emphasizing cautious investment, focusing on core regions, and ensuring precise investment decisions - Continuously increase in-depth research on the market and various regions, closely monitor policy directions and market changes, and ensure precise investment[240](index=240&type=chunk)[241](index=241&type=chunk) - Investment priorities include liquidity, destocking cycle, and price risk, while also considering profit margin requirements to enhance inventory liquidity[242](index=242&type=chunk) - Continue to enhance diversified investment capabilities, supplementing high-quality projects in core cities through urban renewal, asset packages, and other expansion methods and channels[242](index=242&type=chunk) [Product End: Innovative R&D, Promote Lighthouse Project Implementation, Lead Quality Upgrades](index=66&type=section&id=Product%20End%3A%20Innovative%20R%26D%2C%20Promote%20Lighthouse%20Project%20Implementation%2C%20Lead%20Quality%20Upgrades) This sub-section focuses on product strategy, including innovative R&D, implementing "lighthouse" projects, and leading quality upgrades - The company has developed and launched four product series: 'Jin, Xiu, Hua, Zhang,' and will continue to increase investment in R&D and new technologies to maintain product leadership and differentiation[245](index=245&type=chunk) - Focus on implementing high-quality 'lighthouse' projects, ensure the achievement of expected goals, and continuously strengthen production quality control to ensure timely and high-quality delivery, enhancing brand power[246](index=246&type=chunk) [Supply Chain End: Integrate Resources, Strengthen System Construction, Enhance Operational Efficiency](index=67&type=section&id=Supply%20Chain%20End%3A%20Integrate%20Resources%2C%20Strengthen%20System%20Construction%2C%20Enhance%20Operational%20Efficiency) This sub-section outlines strategies for the supply chain, including resource integration, strengthening system construction, and enhancing operational efficiency - The company will continue to accelerate the construction of its centralized procurement platform and construction system, optimize costs, improve operational efficiency, and enhance the company's core competitiveness in the supply chain[248](index=248&type=chunk) - Strengthen control over key nodes across the entire production and supply chain, including promoting modularization and standardization in the design phase, strengthening research and application of new materials, and optimizing supplier management[249](index=249&type=chunk) [Other Information](index=68&type=section&id=Other%20Information) This section provides additional disclosures, including information on directors' and major shareholders' interests, restricted share incentive schemes, and corporate governance practices [Additional Disclosures](index=68&type=section&id=Additional%20Disclosures) This chapter discloses two additional matters: some domestic lease agreements remain unregistered due to merchants' lack of cooperation, and a discrepancy in total GFA for the Wanguo Plaza property ownership certificate, with a new application pending and expected to take longer than usual - As of June 30, 2025, **92** lease agreements remain unregistered because merchants have not actively assisted the company with registration[252](index=252&type=chunk)[256](index=256&type=chunk) - The property ownership certificate for Wanguo Plaza has an uncovered discrepancy of approximately **770 square meters** in total GFA, and a new property ownership certificate is still being applied for, with processing expected to take longer than usual[254](index=254&type=chunk)[258](index=258&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in the Shares, Underlying Shares and Debentures of the Company and its Associated Corporations](index=69&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20the%20Shares%2C%20Underlying%20Shares%20and%20Debentures%20of%20the%20Company%20and%20its%20Associated%20Corporations) This chapter details the long positions held by directors and the chief executive in the shares of the Company and its associated corporation (C&D Property) as of June 30, 2025, primarily through discretionary trusts and restricted share incentive schemes Directors' Long Positions in the Company's Shares | Director's Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Equity Percentage (%) | | :--- | :--- | :--- | :--- | | Ms. Zhao Chengmin | Founder of a discretionary trust | 33,589,257 | 1.67% | | Mr. Lin Weiguo | Interest in a controlled corporation | 33,589,257 | 1.67% | | Mr. Tian Meitan | Beneficiary of a trust | 345,197 | 0.02% | | Mr. Xu Yixuan | Interest in a controlled corporation | 33,589,257 | 1.67% | - Several directors, as grantees under the 2021, 2022, and 2023 Restricted Share Incentive Schemes, hold shares subject to vesting[265](index=265&type=chunk) Directors' Long Positions in C&D Property Shares | Director's Name | Name of Associated Corporation | Capacity/Nature of Interest | Number of Shares Held | Approximate Equity Percentage (%) | | :--- | :--- | :--- | :--- | | Ms. Zhao Chengmin | C&D Property | Founder of a discretionary trust | 54,287,090 | 3.85% | | Mr. Lin Weiguo | C&D Property | Interest in a controlled corporation | 54,287,090 | 3.85% | | Mr. Tian Meitan | C&D Property | Beneficiary of a trust | 557,908 | 0.04% | | Mr. Xu Yixuan | C&D Property | Interest in a controlled corporation | 54,287,090 | 3.85% | [Major Shareholders' Interests and Short Positions in the Shares and Underlying Shares of the Company](index=73&type=section&id=Major%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20the%20Shares%20and%20Underlying%20Shares%20of%20the%20Company) This chapter lists major shareholders holding 5% or more interests in the Company's shares and underlying shares as of June 30, 2025, including Yinen and its holding companies, OceanLink Partners Fund, LP and its affiliates, and BOC International Trust (Hong Kong) Company Limited Major Shareholders' Long Positions in the Company's Shares | Major Shareholder Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Equity Percentage (%) | | :--- | :--- | :--- | :--- | | Yinen | Beneficial owner | 1,142,467,712 | 56.64% | | Yihong International Limited | Interest in a controlled corporation | 1,142,467,712 | 56.64% | | C&D Real Estate | Interest in a controlled corporation | 1,142,467,712 | 56.64% | | Xiamen C&D Inc. | Interest in a controlled corporation | 1,142,467,712 | 56.64% | | Xiamen C&D | Interest in a controlled corporation | 1,142,467,712 | 56.64% | | OceanLink Partners Fund, LP | Beneficial owner | 154,643,412 | 7.67% | | Mr. Richard Li | Interest in a controlled corporation | 219,123,701 | 10.86% | | OLP Capital Management Limited | Investment manager | 219,123,701 | 10.86% | | RCWL Inc. | Interest in a controlled corporation | 219,123,701 | 10.86% | | Mr. Shen Di Fan | Interest in a controlled corporation | 219,123,701 | 10.86% | | BOC International Trust (Hong Kong) Company Limited | Trustee | 105,100,000 | 5.21% | - Yinen is a wholly-owned subsidiary of Yihong, which is a wholly-owned subsidiary of C&D Real Estate, ultimately controlled by Xiamen C&D[277](index=277&type=chunk) - BOC International Trust (Hong Kong) Company Limited holds relevant shares as trustee for the 2021, 2022, and 2023 Restricted Share Incentive Schemes[277](index=277&type=chunk) [Restricted Share Incentive Schemes](index=74&type=section&id=Restricted%20Share%20Incentive%20Schemes) This chapter outlines the implementation of the 2021, 2022, and 2023 Restricted Share Incentive Schemes, with all available shares fully granted. As of June 30, 2025, a total of 114,922,000 unvested restricted shares remained, of which 2,006,000 shares lapsed due to grantees' resignation or retirement - All shares available for grant under the 2021, 2022, and 2023 Incentive Schemes have been fully granted, and the Company did not adopt any new share schemes or grant any share options or awards during the period[276](index=276&type=chunk) Details of Restricted Share Movements | Category of Grantees | Number of Unvested Restricted Shares as of January 1, 2025 | Vested during the period | Lapsed during the period | Number of Unvested Restricted Shares as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Directors | 2,894,400 | 554,400 | 0 | 2,340,000 | | Other employees of the Group | 137,287,200 | 22,699,200 | 2,006,000 | 112,582,000 | | **Total** | **140,181,600** | **23,253,600** | **2,006,000** | **114,922,000** | - During the period, **2,006,000** restricted shares lapsed due to grantees' resignation or retirement[277](index=277&type=chunk) [Changes in Directors' Information Required Under Rule 13.51B(1) of the Listing Rules](index=78&type=section&id=Changes%20in%20Directors'%20Information%20Required%20Under%20Rule%2013.51B(1)%20of%20the%20Listing%20Rules) This chapter discloses changes in the Board of Directors since May 13, 2025, including the resignations of Mr. Huang Wenzhou and Mr. Zheng Yongda as Non-executive Directors, and the appointment of Mr. Xu Xiaoxi as a Non-executive Director. It also updates other directorships for some directors - Effective May 13, 2025, Mr. Huang Wenzhou and Mr. Zheng Yongda resigned as Non-executive Directors, and Mr. Xu Xiaoxi was appointed as a Non-executive Director[285](index=285&type=chunk) - Mr. Xu Xiaoxi resigned as a director of Xiamen ITG Group Corp., Ltd. in May 2025 and was appointed as a director of Xiamen C&D Inc. from June 2025[286](index=286&type=chunk) - Ms. Ye Yanliu was appointed as a Non-executive Director of Red Star Macalline Group Corporation Ltd. from July 2025[287](index=287&type=chunk) [Retirement Benefit Schemes/Pension Schemes](index=79&type=section&id=Retirement%20Benefit%20Schemes%2FPension%20Schemes) The Group provides defined contribution retirement benefit schemes for employees, with related costs deducted in the profit or loss statement, representing contributions payable to retirement benefit schemes managed by local social security authorities during the period - Retirement benefits for employees are provided through defined contribution schemes[289](index=289&type=chunk)[294](index=294&type=chunk) - Retirement benefit costs deducted from the profit or loss statement represent contributions payable to retirement benefit schemes managed by various local social security authorities in different jurisdictions in accordance with government regulations during the period[289](index=289&type=chunk)[294](index=294&type=chunk) [Other Information](index=79&type=section&id=Other%20Information) This chapter confirms that there have been no significant changes in the Group's business development, financial position, and future prospects since t

Financial Performance - For the six months ended June 30, 2025, the Group's revenue was RMB 80.7 million, a decrease of 10.6% compared to the same period in 2024[12] - The Group's gross profit for the same period was RMB 16.2 million, with a gross profit margin of 20.1%, representing a decrease of 38.6% and a decline of 9.2 percentage points, respectively[13] - The net loss for the six months ended June 30, 2025, was RMB 9.9 million, resulting in a net loss margin of 12.3%, compared to a net loss of RMB 4.8 million and a margin of 5.3% for the same period in 2024[14] - Loss attributable to owners of the Company was RMB 7.3 million, compared to RMB 5.3 million for the same period in 2024[14] - Basic and diluted loss per share attributable to owners of the Company was RMB 0.551 cents, an increase from RMB 0.395 cents for the same period in 2024[15] - Revenue decreased by 10.6% from RMB 90.3 million for the six months ended June 30, 2024, to RMB 80.7 million for the six months ended June 30, 2025, primarily due to declines in hazardous waste incineration and oilfield auxiliary services[43] - The Group recorded a net loss of RMB 9.9 million for the six months ended 30 June 2025, with a net loss margin of 12.3%, compared to a net loss of RMB 4.8 million and a net loss margin of 5.3% for the same period in 2024[80] - The total comprehensive loss for the period was RMB 9,886,000, compared to RMB 4,799,000 in 2024, indicating a 106.0% increase in losses[171] Revenue Breakdown - Revenue from hazardous waste incineration solutions decreased by 38.5% from RMB17.9 million for the six months ended June 30, 2024, to RMB11.0 million for the same period in 2025[38] - Revenue from oilfield auxiliary services decreased by 9.5% from RMB53.5 million for the six months ended June 30, 2024, to RMB48.4 million for the same period in 2025[39] - Revenue from cement plant parallel kiln co-treatment services increased by 48.0% from RMB12.3 million for the six months ended June 30, 2024, to RMB18.2 million for the same period in 2025[40] - Revenue from oil sludge thermal desorption treatment services decreased by 93.2% from RMB5.9 million for the six months ended June 30, 2024, to RMB0.4 million for the same period in 2025[41] - The solid waste treatment segment generated external sales of RMB 32,357,000, down 12.8% from RMB 36,872,000 in 2024[195] - The oilfield auxiliary services segment reported external sales of RMB 48,352,000, a decline of 9.9% from RMB 53,472,000 in 2024[195] - Revenue from hazardous waste incineration solutions decreased by 38.4% to RMB 10,994,000[199] Project and Capacity Updates - The Group completed 51 hazardous waste incineration projects before 2025, with an aggregate designed disposal capacity of 1,222,500 tonnes per annum[21] - In the first half of 2025, the Group completed a hazardous waste incineration project with a designed disposal capacity of approximately 30,000 tonnes per annum[21] - As of June 30, 2025, the Group had 5 ongoing hazardous waste incineration projects across 5 cities in the PRC, with a total designed disposal capacity of approximately 131,000 tonnes per annum[21] - The Group's new pyrolysis solid waste treatment project has a designed disposal capacity of 220,000 tonnes per annum, with trial operations expected to commence in Q3 2025[33] Cost and Expenses - Gross profit decreased by 38.6% from RMB 26.4 million to RMB 16.2 million, with gross profit margin declining from 29.3% to 20.1%[54] - Gross profit from hazardous waste incineration solutions decreased by 35% from RMB 11.7 million to RMB 7.6 million, primarily due to a 38.5% decrease in revenue[60] - Gross profit from oilfield auxiliary services decreased by 27.8% from RMB 9.0 million to RMB 6.5 million, mainly due to a 9.5% decrease in revenue[58] - Gross profit from cement plant parallel kiln co-treatment services increased by 5.6% from RMB 3.6 million to RMB 3.8 million, attributed to a 48.0% increase in revenue[59] - The Group's administrative expenses decreased by 7.0% from RMB27.1 million for the six months ended 30 June 2024 to RMB25.2 million for the six months ended 30 June 2025[69] - Research and development costs increased by 45.5% from RMB3.3 million for the six months ended 30 June 2024 to RMB4.8 million for the six months ended 30 June 2025, attributed to increased R&D costs for pyrolysis solid waste treatment[70] Cash Flow and Financial Position - Cash and cash equivalents increased to approximately RMB65.9 million as at June 30, 2025, compared to RMB49.8 million as at December 31, 2024[96] - The net cash generated from operating activities for the six months ended June 30, 2025, was RMB 31,599,000, a significant improvement compared to a net cash used of RMB 27,567,000 in the same period of 2024[177] - The Company reported a net cash used in investing activities of RMB 32,524,000 for the six months ended June 30, 2025, compared to RMB 3,754,000 in the prior year, primarily due to increased purchases of property, plant, and equipment[177] - Financing activities generated a net cash inflow of RMB 17,078,000 for the six months ended June 30, 2025, compared to RMB 10,627,000 in the same period of 2024[177] - The Group's borrowings increased to RMB81.0 million as at June 30, 2025 from RMB61.8 million as at December 31, 2024, secured by the Group's assets[91] - The Group's gearing ratio as of June 30, 2025, was approximately 39.3%, slightly up from 39.0% as of December 31, 2024[103] Strategic Initiatives - The Group plans to enhance its market position in hazardous waste incineration by improving treatment techniques and expanding customer relationships[110] - The Group aims to capitalize on business opportunities in solid waste treatment through the industrialization of pyrolysis technology, focusing on waste plastics and waste paper residues[111] - The Group will explore innovative applications of artificial intelligence (AI) in the environmental technology sector to improve operational efficiency and data analysis capabilities[115] - The Group intends to leverage its capital strength to enter solid waste treatment fields through technology cooperation, investment, and mergers and acquisitions[116] - The Group is focused on establishing a comprehensive environmental industry group by expanding its market presence in solid waste management[119] Shareholder Information - As of June 30, 2025, Mr. Cai Zhuhua holds 531,118,000 shares, representing approximately 39.83% of the company's issued share capital[122] - DHW Holdings Limited, beneficial owner, holds 324,971,000 shares, accounting for approximately 24.38% of the company's issued share capital[128] - The company adopted a Pre-IPO Share Option Scheme on December 10, 2018, to incentivize directors and senior management, valid for ten years[131] - As of June 30, 2025, no rights to acquire shares or debentures were granted to any directors or their respective spouses or children under 18 years of age[130] - The total number of options granted under the Pre-IPO Share Option Scheme has not changed during the reporting period, remaining at 27,000,036[143] Corporate Governance - The Company has fully complied with the corporate governance code provisions during the Reporting Period[147] - The Audit Committee, consisting of three independent non-executive Directors, reviewed the Group's interim results for the six months ended June 30, 2025[162] - No interim dividend was recommended for the six months ended June 30, 2025[161] - There were no purchases, sales, or redemptions of the Company's listed securities during the six months ended June 30, 2025[152] - The Company has established written guidelines to regulate dealings by relevant employees likely to possess inside information regarding the Company's securities[151]

Financial Performance - For the six months ended June 30, 2025, the group's revenue was approximately RMB 596.9 million, an increase of about 7.9% compared to RMB 553.5 million in the same period of 2024[8]. - The net profit attributable to the owners of the company for the same period was approximately RMB 43.2 million, representing an increase of about 3.8% from RMB 41.6 million in 2024[8]. - The group's CMS business revenue reached approximately RMB 403.3 million, reflecting an increase of about 11.8% from RMB 360.8 million in the previous year[10]. - The OBM business generated revenue of approximately RMB 68.7 million, marking an increase of about 18.0% compared to RMB 58.2 million in 2024[11]. - The wholesale business revenue was approximately RMB 125 million, a decrease of about 6.7% from RMB 134 million in the same period last year[12]. - Profit for the six months ended June 30, 2025, was approximately RMB 43,200,000, an increase of about RMB 1,600,000 compared to RMB 41,600,000 in the same period of 2024[20]. - Revenue for the six months ended June 30, 2025, was RMB 596,928,000, an increase of 7.97% compared to RMB 552,976,000 for the same period in 2024[42]. - Gross profit for the same period was RMB 69,473,000, representing a gross margin of approximately 11.6%[42]. - Operating profit decreased to RMB 50,320,000 from RMB 54,883,000, a decline of 8.5% year-over-year[42]. - Net profit for the period was RMB 43,219,000, up from RMB 41,617,000, reflecting a growth of 3.86%[42]. Assets and Liabilities - Total assets as of June 30, 2025, were approximately RMB 1,638,800,000, a decrease from RMB 1,694,800,000 as of December 31, 2024[25]. - Inventory increased by approximately 18.8% to RMB 68,400,000 as of June 30, 2025, compared to RMB 57,600,000 as of December 31, 2024, to meet future sales plans[23]. - Accounts receivable decreased by approximately 58.7% to RMB 44,500,000 as of June 30, 2025, down from RMB 107,600,000 as of December 31, 2024[24]. - Current liabilities decreased to RMB 852,026,000 from RMB 949,153,000, indicating a reduction of 10.24%[44]. - The capital debt ratio improved from approximately 175.8% as of December 31, 2024, to about 150.5% as of June 30, 2025, due to an increase in total equity and a decrease in bank borrowings[25]. - The group’s net current liabilities as of June 30, 2025, were approximately RMB 256,058,000, highlighting reliance on short-term financing[49]. - The total accounts receivable and other receivables decreased to RMB 401,884,000 as of June 30, 2025, from RMB 508,028,000 as of December 31, 2024, representing a decline of about 21%[73]. - The total liabilities related to accounts payable decreased to RMB 475,030,000 from RMB 531,148,000 as of December 31, 2024, a reduction of about 10.6%[76]. Cash Flow and Financing - The net cash generated from operating activities for the six months ended June 30, 2025, was RMB 63,849,000, significantly higher than RMB 10,851,000 for the same period in 2024, indicating a growth of approximately 487%[46]. - The group recorded a net cash outflow from financing activities of RMB 25,848,000 for the six months ended June 30, 2025, compared to a net inflow of RMB 32,313,000 for the same period in 2024[46]. - Cash and cash equivalents as of June 30, 2025, were RMB 24,904,000, down from RMB 32,087,000 at the end of 2024[43]. - The company reported a net financing cost of RMB (2,433) thousand for the six months ended June 30, 2025, a decrease of 72.5% from RMB (8,867) thousand in the same period of 2024[63]. - The group has obtained additional bank financing after June 30, 2025, to alleviate liquidity pressure and improve financial conditions[50]. Expenses and Cost Management - Sales expenses increased by approximately 44.8% to RMB 13.9 million, primarily due to higher transportation, travel, and employee-related costs[16]. - Administrative and other operating expenses increased by approximately 14.8% to RMB 35,000,000 for the six months ended June 30, 2025, compared to RMB 30,500,000 in the same period of 2024[17]. - The total employee costs for the six months ended June 30, 2025, were approximately RMB 33,400,000, compared to RMB 30,600,000 in the same period of 2024[35]. - The group has implemented multiple cost control measures to improve operating cash flow amid significant uncertainty regarding its ability to continue as a going concern[49]. Strategic Initiatives - The group plans to strengthen supply chain construction and control procurement costs while enhancing R&D capabilities to develop high-value-added products[9]. - The company aims to expand its product line through the development of medicinal and edible aerosol products and cosmetics via its subsidiary Zhejiang Guoyao Jingyue Aerosol Co., Ltd.[9]. - The management will closely monitor domestic and international market trends to adjust strategies for better performance[9]. - The company plans to continue upgrading existing production lines to improve automation and product quality, and expand its sales network and platforms[37]. Shareholder Information - As of June 30, 2025, Mr. Yu holds 250,644,000 shares, representing approximately 50.96% of the company's equity[84]. - Mr. Wang holds 1,200,000 shares, representing approximately 0.24% of the company's equity[84]. - Green Island Investment holds 250,644,000 shares, representing approximately 50.96% of the company's equity[86]. - Ms. Wang holds 250,644,000 shares through spousal rights, representing approximately 50.96% of the company's equity[86]. - Perfect Century Group Limited holds 35,400,000 shares, representing approximately 7.20% of the company's equity[86]. - The total number of issued shares as of June 30, 2025, is 491,800,000 shares[87]. - Perfect Century Group Limited's convertible bonds worth RMB 32,000,000 are no longer convertible into 23,600,000 shares due to a court ruling[88]. - The company has not granted any rights to directors or their family members to purchase shares or debt securities during the reporting period[89]. Governance and Compliance - The Audit Committee is responsible for reviewing the financial reporting procedures and risk management processes of the group[93]. - The company has complied with the corporate governance code, except for the separation of the roles of Chairman and CEO, which are held by the same individual[96]. - All directors confirmed compliance with the standard code regarding securities trading during the reporting period[97]. - There were no significant post-reporting events from June 30, 2025, to the report date[103]. - The company did not purchase, sell, or redeem any of its listed securities during the reporting period[100]. - There were no stock option plans in place during the reporting period[98]. - The company did not enter into any new significant lease agreements during the six months ended June 30, 2025[69]. - The company has not proposed an interim dividend for the six months ending June 30, 2025, consistent with the previous year[101].

Financial Performance - Total vehicle deliveries for the six months ended June 30, 2025, reached 197,189 units, an increase of 279.0% compared to 52,028 units for the same period in 2024[4]. - Total revenue for the six months ended June 30, 2025, was RMB 34.09 billion, up 132.5% from RMB 14.66 billion for the same period in 2024[9]. - Vehicle sales revenue for the six months ended June 30, 2025, amounted to RMB 31.25 billion, a 152.8% increase from RMB 12.36 billion for the same period in 2024[4]. - Gross margin for the six months ended June 30, 2025, was 16.5%, compared to 13.5% for the same period in 2024[10]. - Net loss for the six months ended June 30, 2025, was RMB 1.14 billion, a decrease from RMB 2.65 billion for the same period in 2024[4]. - The non-GAAP net loss for the six months ended June 30, 2025, was RMB 0.81 billion, down from RMB 2.63 billion for the same period in 2024[14]. - The basic and diluted net loss per American Depositary Share for the six months ended June 30, 2025, was RMB 1.20, compared to RMB 2.81 for the same period in 2024[14]. - For the six months ended June 30, 2025, the net loss was RMB 1,141,800, a significant improvement from a net loss of RMB 2,652,571 in the same period of 2024, representing a reduction of approximately 57%[57]. - The company reported a cumulative deficit of RMB (42,744,171) thousand as of June 30, 2025, compared to RMB (41,585,549) thousand at the end of 2024, indicating an increase in losses[50]. Cash Flow and Liquidity - As of June 30, 2025, cash and cash equivalents totaled RMB 47.57 billion, compared to RMB 41.96 billion as of December 31, 2024[4]. - The net cash provided by operating activities for the six months ended June 30, 2025, was approximately RMB 7.64 billion, compared to a net cash used of RMB 7.39 billion for the same period in 2024[17]. - Cash generated from operating activities was RMB 7,636,590, compared to cash used in operating activities of RMB 7,391,612 in the prior year, indicating a turnaround in operational cash flow[57]. - The total cash and cash equivalents increased to RMB 23,340,567 at the end of the period, up from RMB 17,704,744 at the end of June 2024[60]. - As of June 30, 2025, the group's cash and cash equivalents, including restricted cash and short-term deposits, amounted to RMB 40,393,753, providing sufficient liquidity for operational needs[73]. Research and Development - Research and development expenses for the six months ended June 30, 2025, were RMB 4.19 billion, an increase of 48.6% from RMB 2.82 billion for the same period in 2024[10]. - The company reported R&D expenses of RMB 4,186,868 and RMB 2,817,200 for the six months ending June 30, 2025, and 2024, respectively, indicating a significant increase in investment in innovation[127]. Inventory and Assets - As of June 30, 2025, total inventory reached RMB 6,602,952 thousand, up from RMB 5,562,922 thousand as of December 31, 2024, representing a 18.7% increase[153]. - The net value of property, plant, and equipment was RMB 11,887,778 thousand as of June 30, 2025, compared to RMB 11,521,863 thousand as of December 31, 2024, showing a 3.2% increase[159]. - Total intangible assets amounted to RMB 5,521,716 thousand as of June 30, 2025, down from RMB 5,524,637 thousand as of December 31, 2024, a decrease of 0.1%[161]. Borrowings and Liabilities - The total short-term bank loans from banks in China as of June 30, 2025, amounted to RMB 3.20 billion, with an effective annual interest rate of 2.09%[22]. - Total liabilities reached RMB 62,089,592 thousand, up from RMB 51,431,317 thousand, indicating an increase of about 20.3%[48][50]. - The total borrowings amounted to RMB 11,256,478 as of June 30, 2025, a decrease of 7.2% from RMB 12,132,254 as of December 31, 2024[183]. - The company has not violated any financial covenants related to its credit facilities as of June 30, 2025[187]. Government Subsidies and Income - The company received government subsidies totaling RMB 3.58 billion and RMB 3.67 billion for interest expenses related to loans as of June 30, 2025, and December 31, 2024, respectively[24]. - Government subsidies recognized as other income amounted to RMB 781,442 thousand and RMB 352,883 thousand for the six months ended June 30, 2025, and 2024, respectively[131]. Market Strategy and Future Outlook - The company aims to enhance product market acceptance and improve sales through more effective marketing strategies and cost control measures[18]. - The company believes that the long-term development trend of the smart electric vehicle market remains unchanged despite short-term challenges[41]. - The company is committed to long-term investments in core technologies of electrification and intelligence, expecting to accelerate the release of new products[41]. Acquisitions and Subsidiaries - The company has established several key subsidiaries, including Beijing XPeng Motors Co., Ltd. with a registered capital of RMB 50,000,000 and a 100% ownership stake[64]. - The company acquired 100% of Jiangsu Zhipeng Spatial Information Technology Co., Ltd. on June 23, 2021, which holds surveying qualifications[66]. - The company is actively expanding its market presence through strategic acquisitions and partnerships in the automotive technology sector[66]. Revenue Recognition and Accounting Policies - Revenue is recognized when control of goods or services is transferred to customers, either over time or at a specific point in time, depending on the contract terms[111]. - The group allocates the total contract price to various performance obligations based on relative standalone selling prices, which may involve significant assumptions and estimates[113]. - The company has a structured approach to recognizing revenue from contracts with customers, ensuring compliance with ASC 606 standards[119].

2025年中期報告 Interim Report 2025 目錄 CONTENTS | 經營業績 | | | --- | --- | | 會計數據和業務數據摘要 | P15 | | 經營業績回顧與分析 | P17 | | 內含價值 | P39 | 46 | 重要提示 | P2 | | --- | --- | | 公司簡介及釋義 | P3 | | 經營概覽 | P5 | | 董事長致辭 | P9 | 14 | 董事會報告和重要事項 | P47 | | --- | --- | | 股份變動及股東情況 | P57 | | 董事、監事和高級管理人員情況 | P61 | | 企業管治情況 | P65 | | 環境和社會責任 | P69 | | 其他信息 | | --- | 備查文件目錄 P75 78 財務報告 審閱報告 中期財務報表 提示申明： 本報告中所涉及的未來計劃、發展戰略等前瞻性描述不構成公 司對投資者的實質承諾，投資者及相關人士均應當對此保持足 夠的風險認識，並且應當理解計劃、預測與承諾之間的差異。 特提請注意 2025 年中期報告 1 公司治理 74 重要提示 聯繫我們 重要提示 中國太平洋保險（集團）股份 ...

[Company Information](index=3&type=section&id=Company%20Information) [Directors and Committees](index=3&type=section&id=Directors%20and%20Committees) This section outlines the composition of the Board of Directors and its various committees, including executive and independent non-executive members - Executive Directors include Mr. Lau Shek Yau (Chairman), Mr. Ngan Tim Wing (Chief Executive Officer), Ms. Chan Nga Man, Ms. Augusta Morandin, and Mr. Fabio Di Nello[3](index=3&type=chunk) - The company has an Audit Committee, Remuneration Committee, Nomination Committee, Corporate Governance Committee, and Risk and Compliance Committee, all composed of Board members[3](index=3&type=chunk) [Registered and Business Locations](index=3&type=section&id=Registered%20and%20Business%20Locations) The company is registered in the Cayman Islands, with its headquarters and principal place of business in Hong Kong, and lists details of legal advisors, share registrar, principal bankers, and auditors - The registered office is located at Cricket Square, Cayman Islands[3](index=3&type=chunk) - The headquarters and principal place of business in Hong Kong are located at Unit B, 13th Floor, Park Sun Building, 97–107 Wo Yi Hop Road, Kwai Chung, New Territories, Hong Kong[4](index=4&type=chunk) - The auditor is KPMG, and the stock code is 2130[5](index=5&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review](index=5&type=section&id=Business%20Review) The Group primarily provides integrated logistics services, focusing on high-end fashion products and fine wines, achieving a 19.4% revenue increase to HK$1,461.5 million in H1 2025, despite a 17.2% decrease in profit attributable to equity holders - The Group primarily engages in providing integrated logistics services, specializing in high-end fashion products (including luxury and affordable luxury goods) and fine wine products[7](index=7&type=chunk) - The Group operates 28 local branch offices in 16 countries and regions globally, collaborating with over 100 business partners across more than 100 countries[7](index=7&type=chunk) [2025 H1 Financial Performance Overview](index=8&type=section&id=2025%20H1%20Financial%20Performance%20Overview) | Indicator | 2025 H1 (HK$ million) | 2024 H1 (HK$ million) | YoY Growth/Decline | | :--- | :--- | :--- | :--- | | Revenue | 1,461.5 | 1,223.6 | +19.4% | | Profit attributable to equity holders | 15.4 | 18.6 | -17.2% | [Geographical Analysis](index=5&type=section&id=Geographical%20Analysis) The Group achieved revenue growth across Greater China, Europe, and Southeast Asian markets, driven by e-commerce, luxury demand, RCEP, and "China+1" strategies [Regional Revenue Performance (2025 H1)](index=9&type=section&id=Regional%20Revenue%20Performance%20(2025%20H1)) | Region | 2025 H1 Revenue (HK$ million) | 2024 H1 Revenue (HK$ million) | YoY Growth | | :--- | :--- | :--- | :--- | | Greater China | 618.5 | 510.9 | +21.1% | | Europe (Italy) | 349.7 | 303.9 | +15.1% | | Southeast Asia (Vietnam) | 52.3 | 31.87 | +64.1% | | Southeast Asia (Indonesia) | 8.6 | 6.78 | +26.8% | - Revenue growth in Greater China benefited from increased business volume and e-commerce contributions, particularly through Cargo Services Express Limited ("Cargo Services Express") related e-commerce orders[9](index=9&type=chunk) - European market growth was driven by strong luxury demand and rapid e-commerce expansion, especially in air freight forwarding and last-mile delivery[10](index=10&type=chunk) - Southeast Asian markets (Vietnam and Indonesia) benefited from the implementation of the Regional Comprehensive Economic Partnership (RCEP) and the "China+1" strategy adopted by Chinese companies[11](index=11&type=chunk) [Cargo Services Express and Cruise Logistics](index=6&type=section&id=Cargo%20Services%20Express%20and%20Cruise%20Logistics) Cargo Services Express experienced strong growth in the reporting period, with revenue increasing by 178.6% year-on-year, while cruise logistics revenue also grew but faced margin pressure due to project delays from US tariff policies [Cargo Services Express and Cruise Logistics Revenue (2025 H1)](index=14&type=section&id=Cargo%20Services%20Express%20and%20Cruise%20Logistics%20Revenue%20(2025%20H1)) | Business Segment | 2025 H1 Revenue (HK$ million) | 2024 H1 Revenue (HK$ million) | YoY Growth | | :--- | :--- | :--- | :--- | | Cargo Services Express | 246.1 | 88.3 | +178.6% | | Cruise Logistics | 254.9 | 226.4 | +12.6% | - Cargo Services Express has successfully expanded its service scope with major Chinese e-commerce platforms, including freight forwarding, customs clearance, and last-mile delivery services to more cities in Europe and Africa[13](index=13&type=chunk) - Despite revenue growth, the cruise logistics business's profit margins were impacted by the US "reciprocal tariff" policy, which led some cruise operators to postpone major upgrade and renovation projects[15](index=15&type=chunk) [Financial Performance and Segment Analysis](index=6&type=section&id=Financial%20Performance%20and%20Segment%20Analysis) The Group's H1 2025 revenue increased by 19.4%, with gross profit up 6.0%; air freight forwarding remained the largest segment with significant revenue growth, while ocean freight forwarding saw substantial revenue and gross profit increases, and distribution and logistics services declined [2025 H1 Key Financial Indicators](index=17&type=section&id=2025%20H1%20Key%20Financial%20Indicators) | Indicator | 2025 H1 (HK$ million) | 2024 H1 (HK$ million) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 1,461.5 | 1,223.6 | +19.4% | | Gross Profit | 241.8 | 228.3 | +6.0% | | EBITDA | 93.6 | 104.9 | -10.8% | - Air freight forwarding services, the Group's largest segment, accounted for approximately **42.9% of total revenue**, with revenue increasing by **24.6% year-on-year to HK$627.4 million**, primarily driven by Cargo Services Express's e-commerce focused logistics solutions business[19](index=19&type=chunk) - Ocean freight forwarding services revenue increased by **37.5% year-on-year to HK$424.7 million**, and gross profit increased by **74.0% to HK$90.3 million**, mainly due to rising ocean freight rates, a rebound in China's import shipments, growth in Southeast Asian exports, and new collaborations with Japanese automotive brands[20](index=20&type=chunk) - Revenue from distribution and logistics services decreased by **16.4% year-on-year to HK$154.5 million**, with gross profit falling by **45.8% to HK$7.7 million**, primarily due to weakened demand for luxury goods in the local Chinese market[25](index=25&type=chunk) [Liquidity, Financial Resources, and Capital Structure](index=8&type=section&id=Liquidity%2C%20Financial%20Resources%2C%20and%20Capital%20Structure) The Group maintains a robust liquidity position with stable working capital and cash equivalents, significantly increased operating cash inflow, and an improved debt-to-equity ratio to a net cash position, while facing foreign exchange risks without specific hedging policies [Liquidity and Financial Resources Overview](index=26&type=section&id=Liquidity%20and%20Financial%20Resources%20Overview) | Indicator | June 30, 2025 (HK$ million) | December 31, 2024 (HK$ million) | Change | | :--- | :--- | :--- | :--- | | Working Capital | 161.9 | 143.9 | Increase | | Current Ratio | 1.15 | 1.15 | Stable | | Cash and Cash Equivalents | 263.7 | 255.0 | Stable | | Operating Cash Inflow | 49.5 | 15.0 (2024 H1) | Significant Increase | | Outstanding Bank Loans and Overdrafts | 363.3 | 384.1 | Decrease | | Debt-to-Equity Ratio | -24.3% | 35.2% | Improvement (Net Cash Position) | - The Group's working capital increased from approximately **HK$143.9 million** as of December 31, 2024, to **HK$161.9 million** as of June 30, 2025, with the current ratio remaining stable at **1.15**[26](index=26&type=chunk) - The Group is exposed to foreign exchange risks from EUR, GBP, RMB, TWD, and USD, with RMB fluctuations having a greater impact, but does not maintain any specific hedging policies or foreign currency forward contracts for these risks[28](index=28&type=chunk) [Other Financial Information](index=9&type=section&id=Other%20Financial%20Information) During the reporting period, the Group had no significant investments, capital expenditure commitments, major acquisitions or disposals of subsidiaries and associates, or material events after the reporting period, with contingent liabilities primarily comprising financial guarantees for subsidiary bank facilities - The Group held no significant investments and had no significant capital commitments contracted but not provided for during the reporting period[29](index=29&type=chunk)[30](index=30&type=chunk) - Contingent liabilities primarily consist of financial guarantees provided by the company to banks for certain bank facilities entered into by its subsidiaries, with a maximum liability of **HK$331.2 million**[31](index=31&type=chunk) - No significant acquisitions or disposals of subsidiaries and associates, nor other material events, occurred during or after the reporting period[33](index=33&type=chunk)[34](index=34&type=chunk) [Use of Proceeds](index=10&type=section&id=Use%20of%20Proceeds) The Group raised approximately HK$35.6 million in net proceeds from a share subscription in May 2021; as of June 30, 2025, HK$7.7 million has been used for business expansion in Hainan, Southeast Asia, and the UK, with the remaining HK$19.7 million expected to be utilized by June 2, 2026 - On May 18, 2021, the company entered into a subscription agreement with Mr. Chan Wing Luk, raising net proceeds of approximately **HK$35.6 million**[35](index=35&type=chunk) [Net Proceeds from Share Subscription (as of June 30, 2025)](index=36&type=section&id=Net%20Proceeds%20from%20Share%20Subscription%20(as%20of%20June%2030%2C%202025)) | Use | Net Proceeds (HK$ million) | Unutilized as of Jan 1, 2025 (HK$ million) | Utilized during Reporting Period (HK$ million) | Unutilized as of June 30, 2025 (HK$ million) | Expected Utilization Timeline | | :--- | :--- | :--- | :--- | :--- | :--- | | Expansion of business and local presence in Hainan, Southeast Asia, and the UK | 35.6 | 27.4 | 7.7 | 19.7 | On or before June 2, 2026 | [Outlook](index=10&type=section&id=Outlook) The Group remains optimistic about the global logistics industry's recovery and plans to drive organic growth and enhance market competitiveness by expanding into new vertical sectors like aerospace, strengthening e-commerce platform collaborations (especially Cargo Services Express), and deepening synergies with controlling shareholder DP World - The Group has successfully expanded into perishable goods and automotive sectors, and recently entered the aerospace industry, providing freight forwarding and local transportation services for critical aircraft components to major aviation and engineering companies in China, Singapore, and Taiwan[37](index=37&type=chunk) - Cargo Services Express will continue to strengthen collaborations with e-commerce platforms, having partnered with several other globally renowned platforms to provide freight forwarding, customs clearance, and last-mile delivery services from China to South Africa, Algeria, and the UK[38](index=38&type=chunk) - The Group will enhance synergies with its controlling shareholder, DP World, leveraging its extensive global network to offer more comprehensive services and gain new client referrals, expecting to further deepen synergies and consolidate its market position[39](index=39&type=chunk) [Human Resources and Dividends](index=11&type=section&id=Human%20Resources%20and%20Dividends) As of June 30, 2025, the Group's employee count increased to 883, with a corresponding rise in employee costs, and the Board has declared an interim dividend of HK$0.01 per ordinary share, totaling HK$3,004,890 [Human Resources and Employee Costs](index=40&type=section&id=Human%20Resources%20and%20Employee%20Costs) | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Number of Employees | 883 employees | 823 employees | | Employee Costs (HK$ million) | 172.021 | 166.624 | - The Board has declared an interim dividend of **HK$0.01 per ordinary share** for the reporting period, totaling **HK$3,004,890**, expected to be paid on October 30, 2025[42](index=42&type=chunk) - To determine the entitlement to the interim dividend, the company will suspend share transfer registration from October 3, 2025, to October 8, 2025[43](index=43&type=chunk) [Corporate Governance and Other Information](index=12&type=section&id=Corporate%20Governance%20and%20Other%20Information) [Directors' and Major Shareholders' Interests](index=12&type=section&id=Directors'%20and%20Major%20Shareholders'%20Interests) This section discloses the interests of directors and chief executives in the company's and associated corporations' shares, as well as major shareholders' interests in the company's shares as of June 30, 2025, with DP World Limited being the largest shareholder holding approximately 57.9% [Directors' and Chief Executives' Interests in Company Shares (June 30, 2025)](index=44&type=section&id=Directors'%20and%20Chief%20Executives'%20Interests%20in%20Company%20Shares%20(June%2030%2C%202025)) | Name | Capacity/Nature of Interest | Number and Class of Securities | Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Ngan Tim Wing | Beneficial Owner | 21,241,203 shares (L) | 7.1% | | Ms. Chan Nga Man | Beneficial Owner | 1,256,099 shares (L) | 0.4% | | Ms. Augusta Morandin | Beneficial Owner | 10,000,000 shares (L) | 3.3% | | Mr. Fabio Di Nello | Beneficial Owner | 10,000,000 shares (L) | 3.3% | [Major Shareholders' Interests in Company Shares (June 30, 2025)](index=48&type=section&id=Major%20Shareholders'%20Interests%20in%20Company%20Shares%20(June%2030%2C%202025)) | Shareholder Name/Entity | Capacity/Nature of Interest | Number and Class of Securities | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | DP World Limited | Interest in Controlled Corporation | 173,845,222 shares (L) | 57.9% | | Chan Wing Luk | Beneficial Owner | 24,857,000 shares (L) | 8.3% | | Ms. Ngan Au Kei Yee | Spouse's Interest | 21,241,203 shares (L) | 7.1% | [Share Option and Share Award Schemes](index=15&type=section&id=Share%20Option%20and%20Share%20Award%20Schemes) The company operates a share option scheme and a share award scheme to incentivize and attract talent, with the share option scheme adopted in September 2020 for up to 25,000,000 shares and the share award scheme adopted in May 2021 for up to 10% of issued shares, neither of which has granted, exercised, or cancelled any options or awards as of the reporting date - The Share Option Scheme was adopted on September 17, 2020, to provide incentives or rewards to selected participants who have contributed to the success of the Group's business, with a validity period of ten years[51](index=51&type=chunk) - The maximum number of share options available for grant under the Share Option Scheme is **25,000,000 shares**, representing approximately **8.3%** of the total issued shares as of the reporting date[51](index=51&type=chunk) - The Share Award Scheme was adopted on May 6, 2021, to recognize and motivate eligible persons for their contributions, with a validity period of ten years[54](index=54&type=chunk) - The total number of shares that may be awarded under the Share Award Scheme shall not exceed **10%** of the total issued shares from time to time[55](index=55&type=chunk) - Since their adoption, neither the Share Option Scheme nor the Share Award Scheme has granted, exercised, or cancelled any share options or awards[53](index=53&type=chunk)[56](index=56&type=chunk) [Corporate Governance Practices and Audit Committee](index=16&type=section&id=Corporate%20Governance%20Practices%20and%20Audit%20Committee) The company has complied with the Corporate Governance Code under Appendix C1 Part 2 of the Listing Rules and established a code of conduct for directors' securities transactions, while the Audit Committee, comprising three independent non-executive directors, has reviewed the Group's unaudited consolidated financial results, accounting principles, and internal control systems - The company has adopted and confirmed compliance with the code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Listing Rules during the reporting period[57](index=57&type=chunk) - The company has established its own code of conduct for directors' dealings in the company's securities, and each director confirmed compliance with both this code and the Model Code throughout the reporting period[59](index=59&type=chunk) - The Audit Committee, comprising three independent non-executive directors (Mr. Lam Hing Lun, Mr. Chun Che Man, and Mr. Chan Chun Hung), has discussed with management and external auditors and reviewed the Group's unaudited consolidated financial results and related systems for the reporting period[60](index=60&type=chunk) [Review Report on Interim Financial Information](index=18&type=section&id=Review%20Report%20on%20Interim%20Financial%20Information) KPMG reviewed Cargo Services Logistics International Holdings Limited's interim financial information for the six months ended June 30, 2025, in accordance with Hong Kong Standard on Review Engagements 2410, concluding that nothing came to their attention to suggest the interim financial information is not prepared in all material respects in accordance with HKAS 34 - KPMG has conducted a review in accordance with Hong Kong Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity," issued by the Hong Kong Institute of Certified Public Accountants[63](index=63&type=chunk) - Based on the review, nothing has come to the reviewer's attention that causes them to believe the interim financial information for the six months ended June 30, 2025, is not prepared in all material respects in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting"[64](index=64&type=chunk) [Consolidated Statement of Profit or Loss](index=19&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss) This consolidated statement of profit or loss presents the Group's financial performance for the six months ended June 30, 2025, reporting revenue of HK$1,461,540 thousand, gross profit of HK$241,848 thousand, profit for the period of HK$19,093 thousand, with profit attributable to equity holders of HK$15,429 thousand, and basic and diluted earnings per share of HK$0.053 [Consolidated Statement of Profit or Loss Key Data (Six Months Ended June 30, 2025)](index=67&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20Key%20Data%20(Six%20Months%20Ended%20June%2030%2C%202025)) | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 1,461,540 | 1,223,581 | | Gross Profit | 241,848 | 228,250 | | Operating Profit | 47,908 | 50,033 | | Profit for the Period | 19,093 | 20,248 | | Profit Attributable to Equity Holders of the Company | 15,429 | 18,610 | | Earnings Per Share (HK cents) | 5.3 | 6.4 | [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=20&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) This consolidated statement of profit or loss and other comprehensive income shows the Group's profit for the period and other comprehensive income for the six months ended June 30, 2025, with total comprehensive income for the period at HK$46,645 thousand, of which HK$41,152 thousand is attributable to equity holders of the company and HK$5,493 thousand to non-controlling interests [Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data (Six Months Ended June 30, 2025)](index=68&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income%20Key%20Data%20(Six%20Months%20Ended%20June%2030%2C%202025)) | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Profit for the Period | 19,093 | 20,248 | | Other Comprehensive Income for the Period (net of tax) | 27,552 | (14,151) | | Total Comprehensive Income for the Period | 46,645 | 6,097 | | Total Comprehensive Income Attributable to Equity Holders of the Company | 41,152 | 6,253 | | Total Comprehensive Income Attributable to Non-controlling Interests | 5,493 | (156) | - Other comprehensive income primarily includes exchange differences on translating financial statements of subsidiaries and associates outside Hong Kong, amounting to **HK$27,796 thousand** in 2025 and **(HK$14,233) thousand** in 2024[68](index=68&type=chunk) [Consolidated Statement of Financial Position](index=21&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) This consolidated statement of financial position presents the Group's assets, liabilities, and equity as of June 30, 2025, with total assets of HK$1,751,461 thousand, total liabilities of HK$1,168,603 thousand, and net assets of HK$582,858 thousand, of which total equity attributable to equity holders of the company is HK$553,969 thousand [Consolidated Statement of Financial Position Key Data (as of June 30, 2025)](index=70&type=section&id=Consolidated%20Statement%20of%20Financial%20Position%20Key%20Data%20(as%20of%20June%2030%2C%202025)) | Indicator | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Non-current Assets | 490,033 | 474,324 | | Current Assets | 1,261,428 | 1,126,464 | | Current Liabilities | 1,099,554 | 982,521 | | Non-current Liabilities | 69,049 | 69,809 | | Net Assets | 582,858 | 548,458 | | Total Equity Attributable to Equity Holders of the Company | 553,969 | 512,767 | | Non-controlling Interests | 28,889 | 35,691 | [Consolidated Statement of Changes in Equity](index=23&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) This consolidated statement of changes in equity illustrates the Group's equity movements for the six months ended June 30, 2025, showing an increase in total equity attributable to equity holders of the company from HK$512,767 thousand on January 1, 2025, to HK$553,969 thousand on June 30, 2025, primarily due to profit for the period and other comprehensive income contributions [Consolidated Statement of Changes in Equity Key Data (Six Months Ended June 30, 2025)](index=73&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity%20Key%20Data%20(Six%20Months%20Ended%20June%2030%2C%202025)) | Indicator | Balance as of Jan 1, 2025 (HK$ thousand) | Profit for the Period (HK$ thousand) | Other Comprehensive Income (HK$ thousand) | Total Comprehensive Income (HK$ thousand) | Balance as of June 30, 2025 (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Equity Attributable to Equity Holders of the Company | 512,767 | 15,429 | 25,723 | 41,152 | 553,969 | | Non-controlling Interests | 35,691 | 3,664 | 1,829 | 5,493 | 28,889 | | Total Equity | 548,458 | 19,093 | 27,552 | 46,645 | 582,858 | - Dividends of **HK$12,295 thousand** were paid to non-controlling interests during the period[73](index=73&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=24&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This condensed consolidated statement of cash flows summarizes the Group's cash movements for the six months ended June 30, 2025, reporting net cash generated from operating activities of HK$49,482 thousand, net cash generated from investing activities of HK$5,466 thousand, and net cash used in financing activities of HK$59,346 thousand, resulting in a net decrease in cash and cash equivalents of HK$4,398 thousand [Condensed Consolidated Statement of Cash Flows Key Data (Six Months Ended June 30, 2025)](index=74&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows%20Key%20Data%20(Six%20Months%20Ended%20June%2030%2C%202025)) | Activity Type | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net Cash Generated From/(Used In) Operating Activities | 49,482 | (15,026) | | Net Cash Generated From/(Used In) Investing Activities | 5,466 | (15,009) | | Net Cash Used In Financing Activities | (59,346) | (19,464) | | Net Decrease in Cash and Cash Equivalents | (4,398) | (49,499) | | Cash and Cash Equivalents as of June 30 | 263,640 | 208,417 | [Notes to the Unaudited Interim Financial Information](index=25&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Financial%20Information) [Basis of Preparation and Changes in Accounting Policies](index=25&type=section&id=Basis%20of%20Preparation%20and%20Changes%20in%20Accounting%20Policies) This interim financial report is prepared in accordance with HKAS 34 and reviewed by KPMG, with the Group applying HKAS 21 (Amendments) "The Effects of Changes in Foreign Exchange Rates — Lack of Exchangeability," which had no material impact on this report - The interim financial report is prepared in accordance with the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, including compliance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[75](index=75&type=chunk) - The interim financial report is unaudited but has been reviewed by KPMG in accordance with Hong Kong Standard on Review Engagements 2410[76](index=76&type=chunk) - The Group has applied Hong Kong Accounting Standard 21 (Amendments) "The Effects of Changes in Foreign Exchange Rates — Lack of Exchangeability" issued by the Hong Kong Institute of Certified Public Accountants to the interim financial report for this accounting period, but these amendments had no material impact on this interim report as the Group did not enter into any foreign currency transactions where one foreign currency is not exchangeable into another currency[77](index=77&type=chunk) [Revenue and Segment Information](index=26&type=section&id=Revenue%20and%20Segment%20Information) The Group primarily offers air freight forwarding, ocean freight forwarding, distribution and logistics, and cruise logistics services, with total revenue of HK$1,461,540 thousand in H1 2025, predominantly from air freight forwarding services, and detailed disclosures for each segment's revenue and gross profit, as well as revenue by geographical location [Revenue from Contracts with Customers by Major Service Item (HK$ thousand)](index=80&type=section&id=Revenue%20from%20Contracts%20with%20Customers%20by%20Major%20Service%20Item%20(HK%24%20thousand)) | Service Item | 2025 | 2024 | | :--- | :--- | :--- | | Provision of Air Freight Forwarding Services | 627,359 | 503,592 | | Provision of Ocean Freight Forwarding Services | 424,718 | 308,940 | | Provision of Distribution and Logistics Services | 154,515 | 184,659 | | Provision of Cruise Logistics Services | 254,948 | 226,390 | | **Total** | **1,461,540** | **1,223,581** | [Revenue from Customers by Geographical Location (HK$ thousand)](index=92&type=section&id=Revenue%20from%20Customers%20by%20Geographical%20Location%20(HK%24%20thousand)) | Region | 2025 | 2024 | | :--- | :--- | :--- | | Hong Kong | 284,883 | 258,302 | | Mainland China | 333,627 | 252,615 | | Italy | 349,739 | 303,858 | | United States | 240,114 | 224,835 | | Other Countries | 189,090 | 124,582 | | **Total** | **1,461,540** | **1,223,581** | - Revenue from providing air freight forwarding services, ocean freight forwarding services, and cruise logistics services is recognized over time, while revenue from providing distribution and logistics services is recognized at a point in time when the related services are provided[80](index=80&type=chunk) [Profit Before Tax and Income Tax](index=31&type=section&id=Profit%20Before%20Tax%20and%20Income%20Tax) This section details the expenses affecting profit before tax, including finance costs, depreciation, and amortization of intangible assets, with total income tax of HK$18,821 thousand primarily comprising Hong Kong profits tax, overseas taxes, and withholding tax on distributable profits of subsidiaries [Finance Costs (HK$ thousand)](index=94&type=section&id=Finance%20Costs%20(HK%24%20thousand)) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Interest on bank loans and overdrafts | 9,859 | 10,384 | | Interest arising from loans from DP World Group | 93 | — | | Interest on lease liabilities | 1,818 | 2,599 | | **Total** | **11,770** | **12,983** | [Income Tax (HK$ thousand)](index=95&type=section&id=Income%20Tax%20(HK%24%20thousand)) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Current tax — Hong Kong profits tax | 2,085 | 1,855 | | Current tax — Outside Hong Kong | 18,151 | 16,499 | | Withholding tax on distributable profits of subsidiaries | 2,258 | 1,981 | | Deferred tax | (3,673) | (1,502) | | **Total** | **18,821** | **18,833** | - Hong Kong profits tax provision is calculated at a rate of **16.5%** on the estimated assessable profits for the six months ended June 30, 2025, while withholding tax rates imposed by Taiwan and French tax authorities on dividend income received from subsidiaries incorporated in relevant countries and regions were **21%** and **10%** respectively for the six months ended June 30, 2025[95](index=95&type=chunk)[96](index=96&type=chunk) [Earnings Per Share and Asset Changes](index=32&type=section&id=Earnings%20Per%20Share%20and%20Asset%20Changes) This section provides the calculation of basic earnings per share and details changes in property, plant and equipment, right-of-use assets, and goodwill, noting that diluted earnings per share are the same as basic earnings per share, and goodwill is primarily allocated to Taiwan's air freight forwarding business and Allport Cruise Group's cruise logistics business [Basic Earnings Per Share Calculation Basis (thousand shares)](index=97&type=section&id=Basic%20Earnings%20Per%20Share%20Calculation%20Basis%20(thousand%20shares)) | Item | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Ordinary shares in issue as of Jan 1 | 300,489 | 276,100 | | Weighted average number of ordinary shares as of June 30 | 292,692 | 292,692 | - For the six months ended June 30, 2025, basic earnings per share were **HK$0.053**, which was the same as diluted earnings per share, as there were no dilutive potential ordinary shares[67](index=67&type=chunk)[98](index=98&type=chunk) - The Group acquired property, plant and equipment at a cost of **HK$2,899 thousand** and recognized additions to right-of-use assets of **HK$41,273 thousand** during the reporting period[99](index=99&type=chunk)[100](index=100&type=chunk) [Goodwill Allocation (HK$ thousand)](index=101&type=section&id=Goodwill%20Allocation%20(HK%24%20thousand)) | Cash Generating Unit | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Air freight forwarding business — Taiwan | 21,188 | 24,104 | | Cruise logistics business — Allport Cruise Group | 201,036 | 203,197 | | **Total** | **222,224** | **227,301** | [Receivables, Payables, and Cash Flow](index=33&type=section&id=Receivables%2C%20Payables%2C%20and%20Cash%20Flow) This section details the composition and changes in loans receivable, trade and other receivables and contract assets, pledged bank deposits, cash and cash equivalents, and trade and other payables and contract liabilities, noting that loans receivable include a loan to an employee, and a loan to a director was settled in March 2025 - Loans receivable include an unsecured loan of **US$1,750,000** (approximately **HK$13,636 thousand**) provided to an employee, bearing interest at **5% per annum**, repayable in five annual installments over five years by August 31, 2029[102](index=102&type=chunk) - A loan of **HK$2,800 thousand** provided to a director was settled in March 2025[103](index=103&type=chunk) [Trade Receivables Ageing Analysis (HK$ thousand)](index=104&type=section&id=Trade%20Receivables%20Ageing%20Analysis%20(HK%24%20thousand)) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 month | 469,275 | 432,883 | | 1 to 2 months | 85,999 | 63,671 | | 2 to 3 months | 46,863 | 25,111 | | Over 3 months | 15,041 | 13,249 | | **Trade receivables, net of loss allowance** | **617,178** | **534,914** | [Trade Payables Ageing Analysis (HK$ thousand)](index=108&type=section&id=Trade%20Payables%20Ageing%20Analysis%20(HK%24%20thousand)) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 month | 270,354 | 228,272 | | 1 to 3 months | 57,004 | 68,235 | | Over 3 months | 14,779 | 11,832 | | **Trade payables** | **342,137** | **308,339** | - Pledged bank deposits of approximately **HK$2,415 thousand** are used to secure certain bank facilities to guarantee payments to the Group's airline suppliers and performance bonds for customers[106](index=106&type=chunk) [Bank Loans and Overdrafts](index=36&type=section&id=Bank%20Loans%20and%20Overdrafts) The Group's total bank loans and overdrafts amount to HK$363,302 thousand, primarily comprising unsecured bank loans and supplier financing arrangements, with annual interest rates ranging from 1.25% to 6.85%, and the Group has complied with all bank financing covenants without default [Bank Loans and Overdrafts Repayment Analysis (HK$ thousand)](index=109&type=section&id=Bank%20Loans%20and%20Overdrafts%20Repayment%20Analysis%20(HK%24%20thousand)) | Repayment Term | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year or on demand | 361,338 | 381,531 | | After 1 year but within 2 years | 824 | 1,504 | | After 2 years but within 5 years | 1,140 | 1,040 | | **Total** | **363,302** | **384,075** | [Bank Loans and Overdrafts Type Analysis (HK$ thousand)](index=109&type=section&id=Bank%20Loans%20and%20Overdrafts%20Type%20Analysis%20(HK%24%20thousand)) | Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Unsecured bank overdrafts | 32 | 87 | | Unsecured bank loans — supplier financing arrangements | 223,956 | 205,122 | | Unsecured bank loans | 139,214 | 178,866 | | **Total** | **363,202** | **384,075** | - Bank loans bear annual interest rates ranging from **1.25% to 6.85%** (December 31, 2024: **1.10% to 7.52%** per annum), and the Group has entered into certain post-shipment buyer loan arrangements with banks, presenting amounts payable to banks as "Bank loans and overdrafts"[109](index=109&type=chunk)[111](index=111&type=chunk) - The Group regularly monitors its compliance with bank financing covenants, and as of June 30, 2025, and December 31, 2024, there were no breaches of covenants related to drawing down financing[110](index=110&type=chunk) [Capital, Reserves, and Dividends](index=37&type=section&id=Capital%2C%20Reserves%2C%20and%20Dividends) The company has 300,489,000 ordinary shares in issue, with subsidiaries declaring and paying dividends of HK$12,295 thousand to non-controlling interests during the reporting period, and the Board has declared an interim dividend of HK$0.01 per ordinary share, while the trustee under the share award scheme has purchased 7,791,000 shares but has not granted any shares to individuals - As of June 30, 2025, the company had **300,489,000 ordinary shares** in issue (December 31, 2024: **300,489,000 ordinary shares**)[113](index=113&type=chunk) - During the six months ended June 30, 2025, the Group's subsidiaries declared and paid dividends of **HK$12,295 thousand** to non-controlling interests[114](index=114&type=chunk) - On August 25, 2025, the company declared an interim dividend of **HK$0.01 per ordinary share** for the period ended June 30, 2025[114](index=114&type=chunk) - Under the Share Award Scheme, the trustee has purchased **7,791,000 shares** of the company on the Stock Exchange of Hong Kong, totaling approximately **HK$25,628 thousand**, but as of June 30, 2025, and December 31, 2024, no shares had been granted to any individuals under the Share Award Scheme[116](index=116&type=chunk) [Fair Value Measurement of Financial Instruments](index=38&type=section&id=Fair%20Value%20Measurement%20of%20Financial%20Instruments) This section discloses the Group's fair value measurements of financial instruments, classified into three fair value hierarchy levels according to HKFRS 13, primarily including unlisted and listed equity securities, with unlisted equity securities' fair values estimated using significant unobservable inputs (Level 3) [Financial Assets Measured at Fair Value (HK$ thousand)](index=118&type=section&id=Financial%20Assets%20Measured%20at%20Fair%20Value%20(HK%24%20thousand)) | Item | Fair Value as of June 30, 2025 | Level 1 | Level 2 | Level 3 | | :--- | :--- | :--- | :--- | :--- | | Unlisted equity securities | 395 | — | — | 395 | | Listed equity securities | 648 | 648 | — | — | | **Total** | **1,043** | **648** | **—** | **395** | - The fair value of unlisted equity securities is estimated as the present value of future cash flows, with significant unobservable inputs including a **15% discount rate**, selling prices, sales volumes, and expected free cash flows of the investee companies[120](index=120&type=chunk) - The carrying amounts of the Group's financial instruments measured at amortized cost did not differ significantly from their respective fair values as of June 30, 2025, and December 31, 2024[122](index=122&type=chunk) [Significant Related Party Transactions and Contingent Liabilities](index=40&type=section&id=Significant%20Related%20Party%20Transactions%20and%20Contingent%20Liabilities) This section lists the Group's significant transactions with various related parties, including DP World Group, EV Cargo Group, and associates, primarily involving freight forwarding service income and expenses, while contingent liabilities mainly consist of financial guarantees provided by the company for subsidiary bank facilities [Significant Related Party Transactions (Six Months Ended June 30, 2025)](index=123&type=section&id=Significant%20Related%20Party%20Transactions%20(Six%20Months%20Ended%20June%2030%2C%202025)) | Related Party | Transaction Type | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | :--- | | DP World Group | Income from freight forwarding services received | 40,935 | — | | DP World Group | Freight forwarding service fees paid | 164,298 | — | | DP World Group | Loans | 20,223 | — | | EV Cargo Group | Income from freight forwarding services received | 516 | 415 | | EV Cargo Group | Freight forwarding service fees paid | 3,009 | 2,342 | | Associates | Income from freight forwarding services received | 2,099 | 2,655 | | Associates | Freight forwarding service fees paid | 1,831 | 7,990 | - The DP World Group comprises DP World Limited and its subsidiaries and associates (excluding the Group), and as of June 30, 2025, amounts payable to the DP World Group included a loan of **HK$20,223 thousand** provided to the Group[123](index=123&type=chunk)[126](index=126&type=chunk) - Contingent liabilities represent financial guarantees provided by the company to banks for certain bank facilities entered into by the Group's subsidiaries, with the Group's maximum liability under bank facilities amounting to **HK$331,194 thousand** as of June 30, 2025[124](index=124&type=chunk)

獨立非執行董事 周啓明先生 任啓民先生 馬青山先生 審核委員會 周啓明先生 （審核委員會主席） 任啓民先生 馬青山先生 目錄 2 公司資料 4 主要財務摘要 6 管理層討論及分析 32 簡明綜合損益及其他全面收益表 34 簡明綜合財務狀況表 36 簡明綜合現金流量表 37 簡明綜合權益變動表 39 簡明綜合財務報表附註 59 其他資料 公司資料 董事會 執行董事 梁國龍先生 （主席） 陳大偉先生 （副主席） 趙志剛先生 （行政總裁） 聞亞磊博士 （首席運營官） 非執行董事 邱國榮先生 張清女士 薪酬委員會 周啓明先生 （薪酬委員會主席） 梁國龍先生 任啓民先生 馬青山先生 提名委員會 梁國龍先生 （提名委員會主席） 張清女士 周啓明先生 馬青山先生 任啓民先生 公司秘書 何詠欣女士 （ACG, HKACG (PE)） 授權代表 梁國龍先生 陳大偉先生 核數師 香港立信德豪會計師事務所有限公司 執業會計師 註冊辦事處 Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman, KY1-1111 Cayman Islands 總辦事處兼香港主要營業地點 香港 ...

[Company Information](index=3&type=section&id=Company%20Information) This chapter outlines the company's basic information, including board members, committee compositions, company secretary, authorized representatives, registered office, China headquarters, Hong Kong principal place of business, share registrar, legal counsel, auditor, principal bankers, stock code, company website, and listing date - Company Name: **Neutech Group Limited**[148](index=148&type=chunk) - Stock Code: **9616**[9](index=9&type=chunk) - Listing Date: **September 29, 2020**[9](index=9&type=chunk) - Chairman of the Board and Non-executive Director: **Dr. Liu Jiren**[7](index=7&type=chunk) - Auditor: **Ernst & Young**[9](index=9&type=chunk) [Major Events](index=5&type=section&id=Major%20Events) During the reporting period (January to June 2025), the company underwent significant events, including a name change, integration of education tech products with large domestic AI models, land acquisition by Guangdong College, continuous recognition in innovation competitions, commencement of Dalian Ruikang Rehabilitation Hospital, acquisition of Xikang Yunshe equity, joint operation of smart eldercare platforms, strategic partnership with WorldSkills, and topping out of a health and medical technology park apartment project - Company Name Change: In January 2025, the Group was renamed **Neutech Group** to better reflect its "Education, Healthcare, Eldercare, Wellness, and Tourism" integrated industrial layout and strategic transformation[10](index=10&type=chunk) - Education Technology Innovation: In February 2025, the education technology product "Neusoft Metaverse Creative Creation and Sharing Platform" fully integrated with **Zhipu AI-ChatGLM** and **DeepSeek**, two major domestic large models, promoting intelligent education upgrades[10](index=10&type=chunk) - Strategic Land Acquisition: In February 2025, Guangdong College successfully bid for the land use rights of a new plot in Nanhai District, Foshan City, planning to construct a university science park and international conference center as new practical training bases[10](index=10&type=chunk) - Healthcare and Eldercare Business Expansion: In May 2025, the Dalian Ruikang Rehabilitation Hospital project commenced construction, further enhancing the "medical, rehabilitation, eldercare, and nursing" service system; simultaneously, the company acquired partial equity in Xikang Yunshe, strengthening "wellness and tourism" business resource integration[13](index=13&type=chunk)[15](index=15&type=chunk) - Smart Eldercare Platform: In June 2025, the company, Dalian Eldercare Industry Group, and Neusoft Group jointly established and unveiled "Dalian Digital Smart Eldercare Industry Co., Ltd." to co-operate the "Dalian Smart Eldercare" service platform; the "Shengqing Eldercare" Shenyang City comprehensive eldercare service platform was also launched[16](index=16&type=chunk)[18](index=18&type=chunk) - International Cooperation: In June 2025, the company formed a strategic partnership with **WorldSkills**, becoming its **Global Premium Partner (GPP)**, to promote vocational skill standard innovation and talent development[20](index=20&type=chunk) [Financial Highlights](index=9&type=section&id=Financial%20Highlights) For the six months ended June 30, 2025, the company's revenue decreased by 4.5% year-on-year to RMB 925.0 million, gross profit decreased by 22.0% to RMB 398.1 million, and profit for the period decreased by 26.5% to RMB 204.0 million; adjusted net profit also decreased by 26.3% year-on-year Key Financial Data for H1 2025 (Unaudited) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change Percentage | | :--- | :--- | :--- | :--- | | Revenue | 924,953 | 968,108 | -4.5% | | Cost of Revenue | (526,821) | (457,452) | 15.2% | | Gross Profit | 398,132 | 510,656 | -22.0% | | Selling Expenses | (17,659) | (21,429) | -17.6% | | Administrative Expenses | (94,288) | (92,228) | 2.2% | | Research and Development Expenses | (12,977) | (20,623) | -37.1% | | Net Impairment Loss on Financial Assets | (2,869) | (14,434) | -80.1% | | Other Income | 53,349 | 55,499 | -3.9% | | Other Expenses | (15,983) | (14,629) | 9.3% | | Other Gains, Net | 527 | 315 | 67.3% | | Net Finance Costs | (55,651) | (42,829) | 29.9% | | Profit Before Income Tax | 252,581 | 360,298 | -29.9% | | Income Tax Expense | (48,543) | (82,727) | -41.3% | | Profit for the Period | 204,038 | 277,571 | -26.5% | | Profit for the Period Attributable to Owners of the Company | 203,923 | 277,414 | -26.5% | | Adjusted Net Profit | 204,129 | 276,794 | -26.3% | | Adjusted Net Profit Attributable to Owners of the Company | 204,014 | 276,637 | -26.3% | [Management Discussion and Analysis](index=10&type=section&id=Management%20Discussion%20and%20Analysis) This chapter details the company's strategic transformation in H1 2025, shifting from digital talent education services to building an integrated "Education, Healthcare, Eldercare, Wellness, and Tourism" ecosystem, reviewing financial performance and outlining future development plans [About Us](index=10&type=section&id=1%20About%20Us) Since its establishment in 2000, the company has become a leader in digital talent education services in China, initiating a comprehensive strategic transformation in 2025 to build an integrated "Education, Healthcare, Eldercare, Wellness, and Tourism" ecosystem - Strategic Transformation: Starting in 2025, the company fully initiated a strategic transformation to build an integrated **"Education, Healthcare, Eldercare, Wellness, and Tourism"** new ecosystem for development[26](index=26&type=chunk) - Five Major Business Systems: Established five diversified business systems covering education services, healthcare and eldercare services, health technology, wellness and tourism services, and university science park and campus services[26](index=26&type=chunk) - Vision and Mission: Committed to becoming a **"leader in the Education, Healthcare, Eldercare, Wellness, and Tourism ecosystem"**, with the mission of **"technology empowering the education, healthcare, and eldercare ecosystem, and education innovating digital and intelligent life"**[27](index=27&type=chunk) Revenue by Major Business Segment During the Reporting Period | Business Type | 2025 (RMB thousands) | 2024 (RMB thousands) | Change Percentage | Share of Total Revenue | | :--- | :--- | :--- | :--- | :--- | | Academic Higher Education Services | 779,904 | 802,937 | -2.9% | 84.3% | | Education Technology and Services | 95,393 | 158,301 | -39.7% | 10.3% | | Education Resource Output | 50,629 | 101,509 | -50.1% | 5.5% | | Lifelong Education Services | 44,764 | 56,792 | -21.2% | 4.8% | | Healthcare and Eldercare Services | 49,656 | 6,870 | 622.8% | 5.4% | | **Total** | **924,953** | **968,108** | **-4.5%** | **100.0%** | [Business Review](index=11&type=section&id=2%20Business%20Review) This chapter reviews the company's operational performance and key achievements across its four core business segments: academic higher education, education technology and services, healthcare and eldercare, and university science park and campus services during the reporting period [Academic Higher Education Services](index=11&type=section&id=2.1%20Academic%20Higher%20Education%20Services%EF%BC%8DCommitted%20to%20High-Quality%20Development) Academic higher education services generated approximately RMB 779.9 million in revenue, a slight year-on-year decrease, while the company's three universities maintained leading positions in educational quality, professional development, and innovation, achieving record enrollment numbers - Revenue: Academic higher education services revenue was approximately **RMB 779.9 million**[28](index=28&type=chunk) - Educational Quality: Dalian College ranked first among private universities nationwide in the number of approved national-level first-class undergraduate programs; Chengdu College and Guangdong College ranked leading in fields such as computer science and art design[30](index=30&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) - Enrollment Quota: For the 2025/2026 academic year, the total enrollment quota for the three universities exceeded **21,000**, a year-on-year increase of **6.0%**, with undergraduate quotas increasing by **8.5%**[37](index=37&type=chunk) - Student Enrollment: As of June 30, 2025, the total student enrollment across the three universities was nearly **58,000**, a year-on-year increase of **1.8%**[37](index=37&type=chunk) - Quality Student Intake: Enrollment for the 2025/2026 academic year showed that the highest admission scores for all colleges significantly exceeded the provincial undergraduate control line[40](index=40&type=chunk) Enrollment Quota Changes (2025/2026 vs 2024/2025 Academic Year) | College | 2025/2026 Academic Year | 2024/2025 Academic Year | Change in Number | Change Percentage | | :--- | :--- | :--- | :--- | :--- | | Dalian College Subtotal | 9,742 | 9,251 | 491 | 5.3% | | Chengdu College Subtotal | 7,123 | 6,723 | 400 | 5.9% | | Guangdong College Subtotal | 4,531 | 4,206 | 325 | 7.7% | | **Total** | **21,396** | **20,180** | **1,216** | **6.0%** | Student Enrollment Changes (As of June 30, 2025 vs June 30, 2024) | College | June 30, 2025 | June 30, 2024 | Change Percentage | | :--- | :--- | :--- | :--- | | Dalian College Subtotal | 23,224 | 21,229 | 9.4% | | Chengdu College Subtotal | 21,557 | 21,934 | -1.7% | | Guangdong College Subtotal | 13,010 | 13,618 | -4.5% | | **Total** | **57,791** | **56,781** | **1.8%** | [Education Technology and Services](index=15&type=section&id=2.2%20Education%20Technology%20and%20Services%EF%BC%8DProviding%20Comprehensive%20%E2%80%9C4S%E2%80%9D%20Support%20Services) Education technology and services revenue reached approximately RMB 95.4 million, a 39.7% year-on-year decrease, as the company focused on IT, DT, and HT fields, building a "4S" product service system and expanding lifelong education services - Revenue: Education technology and services revenue was approximately **RMB 95.4 million**, a year-on-year decrease of **39.7%**[41](index=41&type=chunk) - **"4S" Service System**: Established a "4S" product service system comprising CaaS (Content as a Service), SaaS (Software as a Service), PaaS (Platform as a Service), and DaaS (Data as a Service)[41](index=41&type=chunk) - Lifelong Education Business Landscape: Developed elder education business on the foundation of continuing education, creating a synergistic development pattern for continuing and elder education[49](index=49&type=chunk) [Education Resource Output](index=15&type=section&id=2.2.1%20Education%20Resource%20Output) Education resource output revenue was approximately RMB 50.6 million, a 50.1% year-on-year decrease, primarily due to delayed delivery of education technology products, while the company continued to advance AI, big data, and metaverse technologies in education - Revenue: Education resource output revenue was approximately **RMB 50.6 million**, a year-on-year decrease of **50.1%**[48](index=48&type=chunk) - Product Innovation: Developed and iterated smart education platform software and teaching content, including **Smart Education Platform V3.0** and **Metaverse Creative Creation and Sharing Platform**, as well as smart training room products like intelligent connected vehicle training rooms and large model training rooms[42](index=42&type=chunk)[45](index=45&type=chunk) - Industry-Education Integration: Collaborated with **60 institutions** on joint program development and industry colleges, covering nearly **18,000 students**[48](index=48&type=chunk) - Industry Recognition: Included in the topic list for the **"China International College Students' Innovation Competition"** and became a supporting unit for multiple vocational skills competitions[11](index=11&type=chunk)[47](index=47&type=chunk) [Lifelong Education Services](index=19&type=section&id=2.2.2%20Lifelong%20Education%20Services) Lifelong education services generated approximately RMB 44.8 million in revenue, a 21.2% year-on-year decrease, mainly due to reduced student enrollment caused by market changes, despite the company's expansion in continuing and elder education - Revenue: Lifelong education services revenue was approximately **RMB 44.8 million**, a year-on-year decrease of **21.2%**[49](index=49&type=chunk) - Continuing Education: Obtained **2 national-level** and **2 provincial-level** training qualifications, delivering **53 training programs** for **43 institutional clients**, with government and state-owned enterprise training projects accounting for **81%**[50](index=50&type=chunk) - Eldercare Education: Launched the **"LIFECARES"** new eldercare education concept, established **"Neusoft Phoenix College"**, focusing on **"Digital + Art + Health"** featured courses, enrolling over **360 students** during the reporting period[51](index=51&type=chunk) - Online Platform: **"Neusoft Education Online"** accumulated **2.328 million registered users**, with top-paying courses including AI Application Engineer and JAVA Software Development Engineer[50](index=50&type=chunk) [Healthcare and Eldercare Business](index=20&type=section&id=2.3%20Healthcare%20and%20Eldercare%20Business%EF%BC%8DBuilding%20an%20%E2%80%9CEducation,%20Healthcare,%20Eldercare,%20Wellness,%20and%20Tourism%E2%80%9D%20Ecosystem%20for%20the%20Next%20Decade) Healthcare and eldercare business revenue significantly increased by 622.8% year-on-year to approximately RMB 49.7 million, primarily due to the consolidation of Neusoft Health Medical and its subsidiaries, as the company actively expands into the silver economy market - Revenue: Healthcare and eldercare business revenue was approximately **RMB 49.7 million**, a significant year-on-year increase of **622.8%**[52](index=52&type=chunk) - Reason for Growth: Primarily due to the completion of the acquisition of **Neusoft Health Medical and its subsidiaries** on May 31, 2024, with all related revenue consolidated into the Group in H1 2025[68](index=68&type=chunk) - Strategic Layout: Actively responding to the aging society, strategically expanding into the **silver economy market**, and building a mutually beneficial, efficient, and sustainable new business model through the integration of education and healthcare/eldercare businesses[52](index=52&type=chunk) [Medical Services](index=20&type=section&id=2.3.1%20Medical%20Services%EF%BC%8DEstablishing%20a%20Regional%20Health%20Service%20Benchmark) In medical services, Ruikang Cardiovascular Hospital served over 28,000 outpatient and emergency visits, with inpatient and surgical volumes increasing by 34%, while Ruikang Dental Hospital received over 10,000 outpatient visits and was recognized as a "Liaoning Province Elder-Friendly Medical Institution" - Ruikang Cardiovascular Hospital: Outpatient and emergency visits exceeded **28,000**, with inpatient and surgical volumes exceeding **5,800**, a year-on-year increase of **34%**[53](index=53&type=chunk) - Ruikang Dental Hospital: Outpatient visits exceeded **10,000**, awarded the honor of **"Liaoning Province Elder-Friendly Medical Institution"**[54](index=54&type=chunk)[55](index=55&type=chunk) - Teaching Hospital Feature: Ruikang Cardiovascular Hospital serves as a crucial practical training base for health and medical technology students and a experience center for health and rehabilitation courses at Neusoft Phoenix College[53](index=53&type=chunk) [Health and Eldercare Technology Services](index=21&type=section&id=2.3.2%20Health%20and%20Eldercare%20Technology%20Services%EF%BC%8DEnabling%20a%20New%20Smart%20Eldercare%20Service%20Ecosystem) In health and eldercare technology services, Ruikang Home Eldercare Institute achieved an 88% occupancy rate, Chengdu Qingcheng Kangdao Hotel officially opened, and the company acquired equity in Xikang Yunshe to strengthen wellness and tourism integration, while actively developing city-level smart eldercare platforms - Ruikang Home Eldercare Institute: Achieved an occupancy rate of **88%**, primarily serving elderly individuals aged **80 and above** with semi-disabled or higher care needs[56](index=56&type=chunk) - Wellness and Tourism Services: **Chengdu Qingcheng Kangdao Hotel** officially opened, and the company acquired approximately **4.2255% equity** in Xikang Yunshe and made capital contributions, further strengthening wellness and tourism business resource integration[57](index=57&type=chunk)[58](index=58&type=chunk) - Eldercare Technology: Actively developing and promoting **"city-level smart eldercare platforms"**, with Shenyang City's **"Shengqing Eldercare"** platform already launched, and Dalian City's platform soon to be launched[59](index=59&type=chunk)[60](index=60&type=chunk) - Platform Functions: The city-level smart eldercare platform integrates multiple functions such as government supervision, eldercare services, entrepreneurship and employment, and scientific research and innovation, promoting intelligent, efficient, and personalized eldercare services[60](index=60&type=chunk) [University Science Park and Campus Services](index=23&type=section&id=2.4%20University%20Science%20Park%20and%20Campus%20Services%EF%BC%8DProvider%20of%20High-Quality%20Logistics%20Services%20for%20%E2%80%9CEducation,%20Healthcare,%20Eldercare,%20Wellness,%20and%20Tourism%E2%80%9D) University science park and campus services leverage campus assets to provide high-quality logistics, operating a "three locations, three parks, three platforms" technology park system with significant achievements, while continuously optimizing campus life services and managing ongoing infrastructure expansion projects - Science Park Operations: Established a distinctive **"three locations, three parks, three platforms"** operating system, with Dalian Park approved as a national-level maker space, Chengdu Park building a multi-functional platform for industry-academia-research-application, and Foshan Park recognized as a national-level maker space and technology business incubator[62](index=62&type=chunk)[63](index=63&type=chunk) - Campus Life Services: Provided various services such as healthy catering, supermarket cultural and creative products, and sports and fitness for over **60,000 faculty and students**, introducing renowned brands like **KFC, McDonald's, and Luckin Coffee**[65](index=65&type=chunk) - Infrastructure Project Management: Dalian College Health and Medical Technology Park Apartment project is expected to be completed in **December 2025**, adding approximately **6,000 beds**; parts of Guangdong College International Exchange Center and University Science Park project are expected to be completed in **August 2026**, adding approximately **2,000 beds**[66](index=66&type=chunk) [Financial Review](index=24&type=section&id=3%20Financial%20Review) For the six months ended June 30, 2025, the company's revenue decreased by 4.5% year-on-year, gross profit by 22.0%, and profit for the period by 26.5%, with increased operating costs and finance expenses partially offset by optimized selling, R&D, and impairment expenses [Revenue](index=24&type=section&id=Revenue) For the six months ended June 30, 2025, the company's revenue was approximately RMB 925.0 million, a 4.5% year-on-year decrease, with academic higher education services and education technology services declining, while healthcare and eldercare services significantly increased due to acquisition consolidation - Total Revenue: **RMB 925.0 million**, a year-on-year decrease of **4.5%**[67](index=67&type=chunk) - Academic Higher Education Services Revenue: **RMB 779.9 million**, a year-on-year decrease of **2.9%**, primarily due to differences in the academic calendar[67](index=67&type=chunk) - Education Technology and Services Revenue: **RMB 95.4 million**, a year-on-year decrease of **39.7%**[67](index=67&type=chunk) - Education Resource Output Revenue: **RMB 50.6 million**, a year-on-year decrease of **50.1%**, primarily due to delayed product delivery[67](index=67&type=chunk) - Lifelong Education Services Revenue: **RMB 44.8 million**, a year-on-year decrease of **21.2%**, primarily due to reduced student enrollment caused by market changes[67](index=67&type=chunk) - Healthcare and Eldercare Services Revenue: **RMB 49.7 million**, a year-on-year increase of **622.8%**, primarily due to the consolidation of Neusoft Health Medical and its subsidiaries completed on May 31, 2024[68](index=68&type=chunk) [Cost of Revenue](index=25&type=section&id=Cost%20of%20Revenue) For the six months ended June 30, 2025, cost of revenue was approximately RMB 526.8 million, a 15.2% year-on-year increase, primarily due to the consolidation of Neusoft Health Medical and increased staff remuneration and depreciation from growing student enrollment and new facilities - Cost of Revenue: **RMB 526.8 million**, a year-on-year increase of **15.2%**[69](index=69&type=chunk) - Primary Reasons: Consolidation of **Neusoft Health Medical Management Co., Ltd. and its subsidiaries**, coupled with increased staff remuneration and depreciation expenses due to growing student enrollment and the commissioning of expansion projects[69](index=69&type=chunk) [Gross Profit](index=25&type=section&id=Gross%20Profit) For the six months ended June 30, 2025, gross profit was approximately RMB 398.1 million, a 22.0% year-on-year decrease, mainly due to the combined impact of decreased revenue and increased cost of revenue - Gross Profit: **RMB 398.1 million**, a year-on-year decrease of **22.0%**[70](index=70&type=chunk) [Selling Expenses](index=25&type=section&id=Selling%20Expenses) For the six months ended June 30, 2025, selling expenses were approximately RMB 17.7 million, a 17.6% year-on-year decrease, primarily due to the optimization of the sales team structure and reduced staff remuneration - Selling Expenses: **RMB 17.7 million**, a year-on-year decrease of **17.6%**[71](index=71&type=chunk) - Primary Reason: Optimization of the sales team structure, leading to reduced staff remuneration for sales personnel[71](index=71&type=chunk) [Research and Development Expenses](index=25&type=section&id=Research%20and%20Development%20Expenses) For the six months ended June 30, 2025, research and development expenses were approximately RMB 13.0 million, a 37.1% year-on-year decrease, mainly because major R&D projects, such as the smart education platform, were largely completed - Research and Development Expenses: **RMB 13.0 million**, a year-on-year decrease of **37.1%**[72](index=72&type=chunk) - Primary Reason: Major early-stage R&D projects, such as the smart education platform, have been largely completed[72](index=72&type=chunk) [Net Impairment Loss on Financial Assets](index=25&type=section&id=Net%20Impairment%20Loss%20on%20Financial%20Assets) For the six months ended June 30, 2025, net impairment loss on financial assets was approximately RMB 2.9 million, an 80.1% year-on-year decrease, primarily due to the recovery of certain receivables, leading to a lower bad debt ratio - Net Impairment Loss on Financial Assets: **RMB 2.9 million**, a year-on-year decrease of **80.1%**[73](index=73&type=chunk) - Primary Reason: Recovery of certain receivables, leading to a lower bad debt ratio[73](index=73&type=chunk) [Other Income](index=25&type=section&id=Other%20Income) For the six months ended June 30, 2025, other income was approximately RMB 53.3 million, a 3.9% year-on-year decrease, primarily due to a reduction in government grants - Other Income: **RMB 53.3 million**, a year-on-year decrease of **3.9%**[74](index=74&type=chunk) - Primary Reason: Decrease in government grants[74](index=74&type=chunk) [Net Finance Costs](index=25&type=section&id=Net%20Finance%20Costs) For the six months ended June 30, 2025, net finance costs were approximately RMB 55.7 million, a 29.9% year-on-year increase, primarily due to higher interest expenses - Net Finance Costs: **RMB 55.7 million**, a year-on-year increase of **29.9%**[75](index=75&type=chunk) - Primary Reason: Increase in interest expenses[75](index=75&type=chunk) [Income Tax Expense](index=25&type=section&id=Income%20Tax%20Expense) For the six months ended June 30, 2025, income tax expense was approximately RMB 48.5 million, a 41.3% year-on-year decrease, primarily due to a reduction in taxable profit during the reporting period - Income Tax Expense: **RMB 48.5 million**, a year-on-year decrease of **41.3%**[76](index=76&type=chunk) - Primary Reason: Decrease in taxable profit during the reporting period[76](index=76&type=chunk) [Profit for the Period](index=26&type=section&id=Profit%20for%20the%20Period) For the six months ended June 30, 2025, profit for the period decreased by approximately 26.5% year-on-year, with profit attributable to owners of the company at approximately RMB 203.9 million, a 26.5% decrease, and earnings per share decreasing by approximately 25.6% - Profit for the Period: Decreased by **26.5%** year-on-year[77](index=77&type=chunk) - Profit Attributable to Owners of the Company: **RMB 203.9 million**, a year-on-year decrease of **26.5%**[77](index=77&type=chunk) - Earnings Per Share: Decreased by **25.6%** year-on-year[77](index=77&type=chunk) [Non-IFRS Measures](index=26&type=section&id=Non-IFRS%20Measures) The company uses "Adjusted Net Profit" and "Adjusted Net Profit Attributable to Owners of the Company" as non-IFRS measures to exclude the impact of net exchange differences, better reflecting operating performance - Adjusted Net Profit: **RMB 204.1 million**, a year-on-year decrease of **26.3%**[80](index=80&type=chunk) - Adjusted Net Profit Margin: **22.1%** (H1 2024: 28.6%)[80](index=80&type=chunk) Reconciliation of Adjusted Net Profit to Profit for the Period | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Profit for the Period | 204,038 | 277,571 | | Adjustment Item: Net Exchange Loss/(Gain) | 91 | (777) | | **Adjusted Net Profit** | **204,129** | **276,794** | [Financial and Liquidity Position](index=27&type=section&id=Financial%20and%20Liquidity%20Position) As of June 30, 2025, the company's cash and cash equivalents decreased, net current liabilities increased, but the asset-bearing debt ratio and gearing ratio slightly improved, with capital expenditure primarily for campus upgrades and expansion [Liquidity, Financial Resources, and Capital Structure](index=27&type=section&id=Liquidity,%20Financial%20Resources,%20and%20Capital%20Structure) As of June 30, 2025, cash and cash equivalents were approximately RMB 1,456.4 million, a decrease from year-end 2024, with total borrowings from financial institutions at approximately RMB 3,142.9 million, comprising both fixed and floating rate loans - Cash and Cash Equivalents: **RMB 1,456.4 million** (December 31, 2024: RMB 1,664.8 million)[82](index=82&type=chunk) - Total Borrowings from Financial Institutions: **RMB 3,142.9 million** (December 31, 2024: RMB 3,104.0 million)[82](index=82&type=chunk) - Borrowing Interest Rate Types: Approximately **RMB 648.7 million** in fixed-rate borrowings and approximately **RMB 2,494.2 million** in floating-rate borrowings[82](index=82&type=chunk) [Net Current Liabilities](index=28&type=section&id=Net%20Current%20Liabilities) As of June 30, 2025, net current liabilities increased to approximately RMB 510.9 million from RMB 275.5 million at year-end 2024, primarily due to a decrease in total current assets from reduced cash and cash equivalents, leading to a lower current ratio - Net Current Liabilities: **RMB 510.9 million** (December 31, 2024: RMB 275.5 million)[84](index=84&type=chunk) - Current Ratio: **0.79** (December 31, 2024: 0.89)[85](index=85&type=chunk) [Contingent Liabilities](index=28&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities or material litigation against it - No significant contingent liabilities or litigation[86](index=86&type=chunk) [Foreign Exchange Risk](index=28&type=section&id=Foreign%20Exchange%20Risk) The Group's majority of income and expenses are denominated in RMB, and no significant difficulties or impacts from currency fluctuations were experienced during the reporting period, with the Board believing sufficient foreign exchange measures are in place - The majority of income and expenses are denominated in **RMB**, and foreign exchange risk is not significant[87](index=87&type=chunk) [Pledge of Assets](index=28&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, certain bank borrowings of the Group were secured by pledge of tuition and accommodation fee collection rights (RMB 1,942.1 million), equity interests (RMB 157.0 million), and equipment and intellectual property (RMB 44.3 million) - Bank Borrowing Pledges: **RMB 1,942.1 million** secured by the pledge of certain tuition and accommodation fee collection rights[88](index=88&type=chunk) - Equity Pledges: **RMB 157.0 million** secured by the pledge of certain equity interests[88](index=88&type=chunk) - Equipment and Intellectual Property Pledges: **RMB 44.3 million** secured by the pledge of certain equipment and intellectual property[88](index=88&type=chunk) [Asset-Bearing Debt Ratio](index=28&type=section&id=Asset-Bearing%20Debt%20Ratio) As of June 30, 2025, the Group's asset-bearing debt ratio was 43.1%, a slight decrease from 44.0% at year-end 2024 - Asset-Bearing Debt Ratio: **43.1%** (December 31, 2024: 44.0%)[89](index=89&type=chunk) [Gearing Ratio](index=28&type=section&id=Gearing%20Ratio) As of June 30, 2025, the Group's gearing ratio was 138.0%, a slight decrease from 139.7% at year-end 2024 - Gearing Ratio: **138.0%** (December 31, 2024: 139.7%)[90](index=90&type=chunk) [Capital Expenditure](index=28&type=section&id=Capital%20Expenditure) For the six months ended June 30, 2025, the Group's capital expenditure was approximately RMB 331.2 million, primarily for upgrading and expanding campuses - Capital Expenditure: **RMB 331.2 million**[91](index=91&type=chunk) - Primary Use: Upgrading and expanding campuses[91](index=91&type=chunk) [Significant Acquisitions or Disposals of Subsidiaries, Associates, and Joint Ventures](index=29&type=section&id=Significant%20Acquisitions%20or%20Disposals%20of%20Subsidiaries,%20Associates,%20and%20Joint%20Ventures) On May 20, 2025, the company acquired approximately 4.2255% equity in Xikang Yunshe for RMB 30.0 million and invested RMB 45.0 million, holding approximately 9.9341% as of June 30, 2025, with no other significant acquisitions or disposals during the period - Acquisition of Xikang Yunshe: Acquired approximately **4.2255% equity** for **RMB 30.0 million** and made a capital contribution of **RMB 45.0 million**[92](index=92&type=chunk) - Shareholding Percentage: As of June 30, 2025, held approximately **9.9341% equity** in Xikang Yunshe[92](index=92&type=chunk) [Material Investments Held](index=29&type=section&id=Material%20Investments%20Held) For the six months ended June 30, 2025, the company held no material investments valued at or exceeding 5% of its total assets - No material investments held[93](index=93&type=chunk) [Future Plans for Material Investments or Capital Assets](index=29&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) In February 2025, Guangdong College acquired land use rights for two plots in Nanhai District, Foshan City, for RMB 108.53 million, designated for constructing an international exchange center and university science park project - Guangdong College Land Acquisition: Successfully bid for the land use rights of two plots in Nanhai District, Foshan City, for a consideration of **RMB 108.53 million**[94](index=94&type=chunk) - Future Use: For the construction of an international exchange center and university science park project[94](index=94&type=chunk) [Employees and Remuneration Policy](index=29&type=section&id=4%20Employees%20and%20Remuneration%20Policy) The company is committed to building a high-caliber, professional, application-oriented, and international team to support its integrated "Education, Healthcare, Eldercare, Wellness, and Tourism" strategy, offering competitive remuneration, social security, and training benefits - Total Employee Remuneration Cost: For the six months ended June 30, 2025, **RMB 377.3 million** (H1 2024: RMB 340.6 million)[97](index=97&type=chunk) - Total Full-time Employees: **3,918**[100](index=100&type=chunk) - Full-time Teachers: **2,270**, of whom approximately **95.3%** hold master's or doctoral degrees, and approximately **47.1%** have corporate engineering practical experience[98](index=98&type=chunk) - Medical and Nursing Team: **277** individuals, of whom approximately **42.9%** have 10-20 years of experience, and approximately **25.7%** have over 20 years of experience[98](index=98&type=chunk) - Share Incentive Schemes: Established pre-IPO and post-IPO share incentive schemes to incentivize directors and eligible employees[97](index=97&type=chunk) [Future Development Plan](index=31&type=section&id=5%20Future%20Development%20Plan) The company's future development plan focuses on addressing China's aging population and national strategies for high-quality education, aiming to build an integrated "Education, Healthcare, Eldercare, Wellness, and Tourism" ecosystem by 2035 [Development Environment](index=31&type=section&id=5.1%20Development%20Environment) China's aging population is rapidly increasing, with over 300 million people aged 60 and above by the end of 2024, driving the silver economy to an estimated RMB 30 trillion by 2035, supported by national policies promoting technology-enabled eldercare and high-quality education - Aging Trend: As of the end of 2024, China's population aged **60 and above** exceeded **300 million** for the first time[101](index=101&type=chunk) - Silver Economy Scale: Approximately **RMB 7.1 trillion** in 2023, projected to reach **RMB 30 trillion** by 2035[101](index=101&type=chunk) - Policy Support: The state encourages **technology empowerment for healthcare and eldercare services**, building a **"home + community + institutional"** three-in-one eldercare service network; in education, emphasis is placed on high-quality development and industry-education integration, supporting universities to align with strategic emerging industries and future industries in setting up majors[102](index=102&type=chunk)[103](index=103&type=chunk) [Development Strategies](index=32&type=section&id=5.2%20Development%20Strategies) The company will build an integrated "Education, Healthcare, Eldercare, Wellness, and Tourism" ecosystem through resource integration and complementary advantages, enhancing risk resilience and market reach, while upgrading academic higher education, integrating technology into lifelong learning, and becoming a "Education + Technology + Platform" driven eldercare provider - Core Strategy: Build an integrated **"Education, Healthcare, Eldercare, Wellness, and Tourism"** five-in-one ecosystem, achieving multi-business integration to enhance risk resilience and market space[104](index=104&type=chunk) - Education Development: **"Quality Improvement and Excellence Cultivation"** in academic higher education, focusing on IT, digital media, and eldercare fields, adding health and medical technology majors; education technology and services integrating the latest technologies with a **"4S" service model**, creating an online-offline integrated lifelong education system, and optimizing the **"LIFECARES"** eldercare education model[105](index=105&type=chunk) - Healthcare and Eldercare Services: Become a new type of healthcare and eldercare service provider driven by **"Education + Technology + Platform"**, building and operating city-level smart eldercare integrated service platforms, and creating smart health and eldercare solutions combining technologies like AI and big data[106](index=106&type=chunk)[107](index=107&type=chunk) - Campus Services: Standardize campus services, using deep integration of education parks, science parks, and healthcare/eldercare parks as a path to build beautiful smart campuses and communities, and expand a diversified, specialized, and value-added service ecosystem[108](index=108&type=chunk) [Other Information](index=34&type=section&id=Other%20Information) This chapter discloses directors' and major shareholders' interests, pre- and post-IPO share incentive schemes, use of IPO proceeds, listed securities transactions, continuing disclosure obligations, board changes, audit committee review, compliance with directors' securities transaction code (noting Dr. Liu Jiren's share pledge non-compliance and remedial actions), corporate governance code compliance, public float sufficiency, and no significant post-reporting period events [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares, and Debentures of the Issuer or its Associated Corporations](index=34&type=section&id=1%20Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares,%20Underlying%20Shares,%20and%20Debentures%20of%20the%20Issuer%20or%20its%20Associated%20Corporations) As of June 30, 2025, Dr. Liu Jiren held approximately 63.23% of the company's shares through controlled corporations, and Mr. Sun Yinhuan held approximately 10.06% through a discretionary trust - Dr. Liu Jiren: Held **408,586,000 shares** through controlled corporations, representing approximately **63.23%**[110](index=110&type=chunk) - Mr. Sun Yinhuan: Held **65,010,000 shares** as the settlor of a discretionary trust, representing approximately **10.06%**[110](index=110&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares](index=36&type=section&id=2%20Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares) As of June 30, 2025, Kangruidao, Dongkong First, Dongkong Second, Century Bliss, and FIL Limited were substantial shareholders, each holding over 5% of the company's shares, with Dongkong First and Dongkong Second jointly pledging approximately 38.30% of shares as supplementary collateral for a subsidiary loan - Kangruidao: Beneficial interest in **154,689,000 shares**, representing approximately **23.94%**[112](index=112&type=chunk) - Dongkong First and Dongkong Second: Combined beneficial interest in **253,897,000 shares**, representing approximately **39.29%**[112](index=112&type=chunk) - Dongkong First and Dongkong Second jointly pledged approximately **38.30%** of shares to Industrial Bank as supplementary collateral for a **RMB 325.5 million** subsidiary loan[114](index=114&type=chunk) - Century Bliss: Beneficial interest in **65,010,000 shares**, representing approximately **10.06%**[112](index=112&type=chunk) - FIL Limited: Held **41,527,427 shares** through controlled corporations, representing approximately **6.43%**[112](index=112&type=chunk) [Pre-IPO Share Incentive Scheme](index=38&type=section&id=3%20Pre-IPO%20Share%20Incentive%20Scheme) The Pre-IPO Share Incentive Scheme, adopted on June 19, 2019, aimed to incentivize participants, with 33,135,452 share options cancelled, 4,465,116 lapsed, and 3,381,935 exercised as of June 30, 2025 - Scheme Adoption Date: **June 19, 2019**[116](index=116&type=chunk) - As of June 30, 2025: **33,135,452 share options** were cancelled, **4,465,116 share options** lapsed, and **3,381,935 share options** were exercised[116](index=116&type=chunk) [Post-IPO Share Incentive Scheme](index=38&type=section&id=4%20Post-IPO%20Share%20Incentive%20Scheme) The Post-IPO Share Incentive Scheme, adopted on September 11, 2020, aims to retain, incentivize, and reward participants, with no options granted, exercised, lapsed, or cancelled, and no outstanding options as of June 30, 2025 - Scheme Adoption Date: **September 11, 2020**[117](index=117&type=chunk) - As of June 30, 2025: No share options were granted, exercised, lapsed, or cancelled[118](index=118&type=chunk) - Maximum Number of Shares Grantable: Not exceeding **10%** of the total issued shares on the listing date, i.e., **66,666,720 shares**[117](index=117&type=chunk) [Use of Proceeds from Initial Public Offering](index=39&type=section&id=5%20Use%20of%20Proceeds%20from%20Initial%20Public%20Offering) The net proceeds of approximately RMB 777.5 million from the initial public offering have been fully utilized, primarily for upgrading existing school facilities, campus expansion, repaying commercial loans, and supplementing working capital, with some reallocations from planned school acquisitions - Net Proceeds: Approximately **RMB 777.5 million**, fully utilized[120](index=120&type=chunk) Allocation of Proceeds | Use | Percentage of Net Proceeds | Amount Utilized (RMB millions) | | :--- | :--- | :--- | | Upgrading existing school facilities and campus expansion | 51.4% | 399.6 | | Repaying commercial loans | 37.5% | 291.4 | | Supplementing working capital | 11.1% | 86.5 | | **Total** | **100%** | **777.5** | - Change in Use: A portion of funds originally designated for acquiring other schools was reallocated to repay commercial loans and supplement working capital[119](index=119&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=39&type=section&id=6%20Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) 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 - No purchase, sale, or redemption of listed securities during the reporting period[120](index=120&type=chunk) - No treasury shares held[120](index=120&type=chunk) [Continuing Disclosure Obligations under the Listing Rules](index=40&type=section&id=7%20Continuing%20Disclosure%20Obligations%20under%20the%20Listing%20Rules) The company disclosed that Dongkong First and Dongkong Second, wholly-owned subsidiaries of controlling shareholder Neusoft Holdings, pledged approximately 39.29% of the company's shares to Industrial Bank on March 6, 2025, as supplementary collateral for a RMB 325.5 million subsidiary loan, which remains outstanding - Share Pledge: Dongkong First and Dongkong Second pledged a total of approximately **39.29%** of the company's shares to Industrial Bank[121](index=121&type=chunk) - Purpose of Pledge: To provide supplementary collateral for a **RMB 325.5 million** subsidiary loan[121](index=121&type=chunk) - Outstanding Balance: As of the reporting date, the outstanding balance of the loan was **RMB 109 million**[121](index=121&type=chunk) [Changes in Board of Directors and Directors' Information](index=40&type=section&id=8%20Changes%20in%20Board%20of%20Directors%20and%20Directors'%20Information) During the reporting period, several changes occurred in the roles of the company's board members, including adjustments to Dr. Liu Jiren, Dr. Wen Tao, and Mr. Rong Xinjie's positions within Neusoft Group and its subsidiaries, and Dr. Zhang Yinghui's cessation of roles in certain subsidiaries - Dr. Liu Jiren: Appointed Honorary Chairman and Director of Neusoft Group from **April 2025**, and Director of Shenyang Kangyang and Dalian Kangyang from **June 2025**[123](index=123&type=chunk) - Dr. Wen Tao: Appointed Chairman of Neusoft Education Technology from **March 2025**, and Chairman of Shenyang Kangyang and Dalian Kangyang from **June 2025**[123](index=123&type=chunk) - Mr. Rong Xinjie: Appointed Chairman of Neusoft Group from **April 2025**[123](index=123&type=chunk) - Dr. Zhang Yinghui: Ceased to be a Director of Neusoft Education Technology from **March 2025**, and ceased to be a Director and Manager of Chengdu Neusoft Ruixin Health Technology Management Co., Ltd. from **June 2025**[124](index=124&type=chunk) [Audit Committee](index=41&type=section&id=9%20Audit%20Committee) The Audit Committee, comprising two independent non-executive directors and one non-executive director with Dr. Liu Shulian as chair, reviewed the interim results and report for the six months ended June 30, 2025, confirming compliance with applicable accounting principles and adequate disclosure - Composition: Two independent non-executive directors (**Dr. Liu Shulian, Dr. Qu Daokui**) and one non-executive director (**Mr. Rong Xinjie**)[125](index=125&type=chunk) - Chairperson: **Dr. Liu Shulian**[125](index=125&type=chunk) - Review Outcome: Reviewed the interim results and report, confirming compliance with accounting principles and regulations, and adequate disclosure[125](index=125&type=chunk) - Auditor: **Ernst & Young** conducted the review in accordance with **International Standard on Review Engagements 2410**[125](index=125&type=chunk) [Compliance with the Code for Securities Transactions by Directors](index=41&type=section&id=10%20Compliance%20with%20the%20Code%20for%20Securities%20Transactions%20by%20Directors) The company adopted the Model Code and a code of conduct, and all directors confirmed compliance, except for Dr. Liu Jiren whose share pledge during a blackout period constituted a "transaction" not strictly adhering to Model Code paragraphs A.3(a)(i) and B.8, for which remedial actions are being taken - Compliance Status: All directors confirmed compliance with the code, except for **Dr. Liu Jiren** whose share pledge did not strictly adhere to blackout period regulations[126](index=126&type=chunk)[127](index=127&type=chunk) - Non-Compliance Matter: Dr. Liu Jiren's share pledge during a blackout period constituted a "transaction" and did not strictly comply with paragraphs A.3(a)(i) and B.8 of the Model Code[127](index=127&type=chunk) - Remedial Measures: Reminding directors of their obligations, providing enhanced annual training, and sending blackout period notices[127](index=127&type=chunk) [Compliance with the Corporate Governance Code](index=42&type=section&id=11%20Compliance%20with%20the%20Corporate%20Governance%20Code) The company is committed to maintaining stringent corporate governance and has complied with the code provisions and best practices of the Corporate Governance Code, with the Board continuously reviewing and monitoring the company's practices - Complied with the code provisions and best practices of the Corporate Governance Code[128](index=128&type=chunk) [Sufficiency of Public Float](index=42&type=section&id=12%20Sufficiency%20of%20Public%20Float) The Directors confirmed that the company maintained the minimum public float as required by the Listing Rules throughout the six months ended June 30, 2025 - Maintained the minimum public float[130](index=130&type=chunk) [Interim Dividend](index=42&type=section&id=13%20Interim%20Dividend) The Board does not recommend the payment of an interim dividend for the reporting period - No interim dividend recommended for payment[131](index=131&type=chunk) [Events After the Reporting Period](index=42&type=section&id=14%20Events%20After%20the%20Reporting%20Period) No significant events affecting the company or its subsidiaries occurred after the reporting period and up to the date of this report - No significant events after the reporting period[132](index=132&type=chunk) [Review Report on Interim Financial Information](index=43&type=section&id=Review%20Report%20on%20Interim%20Financial%20Information) Ernst & Young conducted a review of the interim condensed consolidated financial information for the six months ended June 30, 2025, in accordance with International Standard on Review Engagements 2410, concluding that no matters came to their attention suggesting the financial information was not prepared in all material respects in accordance with IAS 34 - Reviewing Firm: **Ernst & Young**[134](index=134&type=chunk) - Review Standard: **International Standard on Review Engagements 2410**[135](index=135&type=chunk) - Conclusion: No matters came to their attention that caused them to believe the interim financial information was not prepared, in all material respects, in accordance with **International Accounting Standard 34**[136](index=136&type=chunk) - Nature: Scope of review is less than an audit, thus no audit opinion is expressed[135](index=135&type=chunk) [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=44&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) This statement presents the interim condensed consolidated profit or loss and other comprehensive income for the six months ended June 30, 2025, showing a profit for the period of RMB 204,038 thousand and profit attributable to owners of the company of RMB 203,923 thousand, with other comprehensive income primarily from foreign currency translation differences Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30, 2025) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 924,953 | 968,108 | | Cost of Revenue | (526,821) | (457,452) | | Gross Profit | 398,132 | 510,656 | | Selling Expenses | (17,659) | (21,429) | | Administrative Expenses | (94,288) | (92,228) | | Research and Development Expenses | (12,977) | (20,623) | | Net Impairment Loss on Financial Assets | (2,869) | (14,434) | | Other Income | 53,349 | 55,499 | | Other Expenses | (15,983) | (14,629) | | Other Gains, Net | 527 | 315 | | Net Finance Costs | (55,651) | (42,829) | | Profit Before Tax | 252,581 | 360,298 | | Income Tax Expense | (48,543) | (82,727) | | **Profit for the Period** | **204,038** | **277,571** | | Profit for the Period Attributable to Owners of the Company | 203,923 | 277,414 | | Non-controlling Interests | 115 | 157 | | **Total Comprehensive Income for the Period** | **204,820** | **276,222** | - Basic and Diluted Earnings Per Share: **RMB 0.32** (2024: RMB 0.43)[138](index=138&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=46&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets were RMB 7,366,877 thousand, total liabilities RMB 5,068,456 thousand, and total equity RMB 2,298,421 thousand, with property, plant and equipment and right-of-use assets being significant non-current assets, and trade and other payables and interest-bearing bank and other borrowings as major current liabilities Interim Condensed Consolidated Statement of Financial Position (As of June 30, 2025) | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, Plant and Equipment | 3,729,441 | 3,674,793 | | Right-of-Use Assets | 990,694 | 875,417 | | Investments in Associates | 75,000 | – | | Total Non-current Assets | 5,466,355 | 5,212,382 | | **Current Assets** | | | | Cash and Cash Equivalents | 1,456,442 | 1,664,799 | | Total Current Assets | 1,900,522 | 2,142,671 | | **Total Assets** | **7,366,877** | **7,355,053** | | **Current Liabilities** | | | | Trade and Other Payables | 1,428,688 | 687,802 | | Interest-Bearing Bank and Other Borrowings | 688,453 | 629,727 | | Contract Liabilities | 219,098 | 1,018,382 | | Total Current Liabilities | 2,411,462 | 2,418,192 | | **Non-current Liabilities** | | | | Interest-Bearing Bank and Other Borrowings | 2,454,414 | 2,474,243 | | Total Non-current Liabilities | 2,656,994 | 2,622,909 | | **Total Liabilities** | **5,068,456** | **5,041,101** | | **Total Equity** | **2,298,421** | **2,313,952** | - Net Current Liabilities: **RMB 510,940 thousand**[149](index=149&type=chunk) [Interim Condensed Consolidated Statement of Changes in Equity](index=48&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) This statement outlines the interim condensed consolidated changes in equity for the six months ended June 30, 2025, showing total equity at period-end of RMB 2,298,421 thousand, reflecting total comprehensive income, non-controlling interest contributions, option exercises, and dividend declarations Interim Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30, 2025) | Indicator | January 1, 2025 (RMB thousands) | Total Comprehensive Income for the Period (RMB thousands) | Capital Injected by Non-controlling Shareholders (RMB thousands) | Exercise of Share Options (RMB thousands) | Dividends Declared (RMB thousands) | June 30, 2025 (RMB thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Attributable to Owners of the Company | 2,305,415 | 204,705 | – | 24 | (229,775) | 2,280,369 | | Non-controlling Interests | 8,537 | 115 | 9,400 | – | – | 18,052 | | **Total Equity** | **2,313,952** | **204,820** | **9,400** | **24** | **(229,775)** | **2,298,421** | [Interim Condensed Consolidated Statement of Cash Flows](index=50&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This statement presents the interim condensed consolidated cash flows for the six months ended June 30, 2025, with net cash used in operating activities of RMB (405,693) thousand, net cash used in investing activities of RMB (285,906) thousand, and net cash from financing activities of RMB 483,333 thousand, resulting in a net decrease in cash and cash equivalents Interim Condensed Consolidated Statement of Cash Flows (For the six months ended June 30, 2025) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (405,693) | (499,768) | | Net Cash Used in Investing Activities | (285,906) | (254,842) | | Net Cash From/(Used in) Financing Activities | 483,333 | (79,976) | | Net Decrease in Cash and Cash Equivalents | (208,266) | (834,586) | | Cash and Cash Equivalents at Beginning of Period | 1,664,799 | 1,708,427 | | Cash and Cash Equivalents at End of Period | 1,456,442 | 874,618 | [Notes to the Interim Condensed Consolidated Financial Information](index=51&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) This chapter provides detailed notes to the interim condensed consolidated financial information, covering company and group information, basis of preparation, accounting policies, operating segment information, revenue, profit before tax, income tax, dividends, earnings per share, property, plant and equipment, investments in associates, receivables, cash, payables, borrowings, contract liabilities, share capital, cash flow statement notes, contingent liabilities, commitments, related party transactions, and fair value of financial instruments [Company and Group Information](index=51&type=section&id=1.%20Company%20and%20Group%20Information) Neutech Group Limited, incorporated in the Cayman Islands on August 20, 2018, and renamed on December 4, 2024, primarily provides academic higher education, education technology, and healthcare and eldercare services in mainland China, with Dalian Neusoft Holdings Co., Ltd. as its controlling shareholder - Company Name Change: On December 4, 2024, the company's English name changed from "Neusoft Education Technology Co. Limited" to **"Neutech Group Limited"**[148](index=148&type=chunk) - Principal Businesses: Academic higher education services, education technology and services, and healthcare and eldercare services[148](index=148&type=chunk) - Controlling Shareholder: **Dalian Neusoft Holdings Co., Ltd.** indirectly holds **39.30%** equity interest[148](index=148&type=chunk) [Basis of Preparation and Accounting Policies](index=51&type=section&id=2.%20Basis%20of%20Preparation%20and%20Accounting%20Policies) The interim condensed consolidated financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" on a going concern basis, despite net current liabilities, and the adoption of IAS 21 (Amendment) "Lack of Exchangeability" had no material impact [Basis of Preparation](index=51&type=section&id=2.1%20Basis%20of%20Preparation) The interim condensed consolidated financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" on a going concern basis, with the Board assessing sufficient financial resources despite net current liabilities of RMB 510,940 thousand as of June 30, 2025 - Preparation Standard: **International Accounting Standard 34 "Interim Financial Reporting"**[149](index=149&type=chunk) - Going Concern: Prepared on a **going concern basis**[149](index=149&type=chunk) - Net Current Liabilities: As of June 30, 2025, **RMB 510,940 thousand**[149](index=149&type=chunk) [Changes in Accounting Policies](index=52&type=section&id=2.2%20Changes%20in%20Accounting%20Policies) The financial information for this period adopted IAS 21 (Amendment) "Lack of Exchangeability" for the first time, which clarifies the assessment of currency exchangeability and spot exchange rate estimation, but had no impact on the interim condensed consolidated financial information - Newly Adopted Standard: **International Accounting Standard 21 (Amendment) "Lack of Exchangeability"**[151](index=151&type=chunk) - Impact: Had no impact on the interim condensed consolidated financial information[151](index=151&type=chunk) [Operating Segment Information](index=52&type=section&id=3.%20Operating%20Segment%20Information) The Group is organized into two reportable operating segments: education services and healthcare and eldercare services, with all revenue and non-current assets generated and located in mainland China - Reportable Segments: **Education services** and **healthcare and eldercare services**[152](index=152&type=chunk) Segment Revenue (For the six months ended June 30, 2025) | Segment | Revenue from External Customers (RMB thousands) | | :--- | :--- | | Education Services | 875,297 | | Healthcare and Eldercare Services | 49,656 | | **Total** | **924,953** | Segment Results (For the six months ended June 30, 2025) | Segment | Results (RMB thousands) | | :--- | :--- | | Education Services | 332,376 | | Healthcare and Eldercare Services | (26,384) | | **Total** | **305,992** | - Geographical Information: All revenue and non-current assets are generated and located in **mainland China**[156](index=156&type=chunk) [Revenue and Other Income](index=55&type=section&id=4.%20Revenue%20and%20Other%20Income) For the six months ended June 30, 2025, total revenue was RMB 924,953 thousand, primarily from academic higher education services, education technology and services, and healthcare and eldercare services, while other income mainly comprised rental and property services and government grants Revenue Composition (For the six months ended June 30, 2025) | Service Type | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Academic Higher Education Services | 779,904 | 802,937 | | Education Technology and Services | 95,393 | 158,301 | | Healthcare and Eldercare Services | 49,656 | 6,870 | | **Total** | **924,953** | **968,108** | Other Income Composition (For the six months ended June 30, 2025) | Type | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Rental Income and Property Services | 40,007 | 41,648 | | Government Grants and Subsidies | 7,220 | 9,475 | | Software System Technology Development | 3,981 | 3,559 | | Others | 2,141 | 817 | | **Total** | **53,349** | **55,499** | - Revenue Recognition Timing: **RMB 888,766 thousand (96.1%)** of revenue was transferred over a period of time, and **RMB 35,465 thousand (3.9%)** of revenue was transferred at a point in time[159](index=159&type=chunk) [Profit Before Tax](index=58&type=section&id=5.%20Profit%20Before%20Tax) For the six months ended June 30, 2025, profit before tax was RMB 252,581 thousand, with major expenses including employee benefit expenses, depreciation of property, plant and equipment, and right-of-use assets, and a net impairment loss on financial assets - Profit Before Tax: **RMB 252,581 thousand**[162](index=162&type=chunk) - Employee Benefit Expenses: **RMB 377,314 thousand** (H1 2024: RMB 340,634 thousand)[162](index=162&type=chunk) - Depreciation and Amortization: Depreciation of property, plant and equipment was **RMB 98,716 thousand**, depreciation of right-of-use assets was **RMB 13,755 thousand**, and amortization of other intangible assets was **RMB 5,887 thousand**[162](index=162&type=chunk) - Impairment Provision for Financial Assets: **RMB 2,869 thousand** (H1 2024: RMB 14,434 thousand)[162](index=162&type=chunk) [Income Tax](index=59&type=section&id=6.%20Income%20Tax) The Group pays income tax based on the jurisdiction of each member company, with exemptions in Cayman Islands and BVI, no taxable profit in Hong Kong, and varying preferential or standard corporate income tax rates in mainland China, resulting in an income tax expense of RMB 48,543 thousand for the period - Cayman Islands/British Virgin Islands: Exempt from income tax[164](index=164&type=chunk)[165](index=165&type=chunk) - Hong Kong: No taxable profit generated, no provision made[167](index=167&type=chunk) - China Corporate Income Tax: Certain subsidiaries enjoy preferential tax rates of **15%-20%**, while others pay at a **25%** rate[169](index=169&type=chunk) - Withholding Tax: Imposed on dividends distributed by Chinese companies to foreign investors, the Group applies a **5%** withholding tax rate, with **RMB 21,000 thousand** provided[170](index=170&type=chunk) - Income Tax Expense: **RMB 48,543 thousand** (H1 2024: RMB 82,727 thousand)[171](index=171&type=chunk) [Dividends](index=60&type=section&id=7.%20Dividends) On May 30, 2025, the annual general meeting approved a final dividend of HKD 0.388 per share for the year ended December 31, 2024, totaling approximately RMB 229,775 thousand, which was declared but unpaid, with no interim dividends declared or paid for the reporting period - Final Dividend: **HKD 0.388 per share**, totaling approximately **RMB 229,775 thousand**, declared but unpaid[172](index=172&type=chunk) - Interim Dividend: No interim dividend declared or paid during the reporting period[174](index=174&type=chunk) [Earnings Per Share Attributable to Ordinary Equity Holders of the Company](index=61&type=section&id=8.%20Earnings%20Per%20Share%20Attributable%20to%20Ordinary%20Equity%20Holders%20of%20the%20Company) For the six months ended June 30, 2025, basic earnings per share were RMB 0.32, a decrease from RMB 0.43 in the prior year, calculated based on profit attributable to ordinary equity holders and the weighted average number of ordinary shares, with no dilutive adjustment due to anti-dilutive unexercised share options - Basic Earnings Per Share: **RMB 0.32** (H1 2024: RMB 0.43)[176](index=176&type=chunk) - Calculation Basis: Based on profit attributable to ordinary equity holders of the company and the weighted average number of ordinary shares outstanding of **646,207,135 shares**[175](index=175&type=chunk)[176](index=176&type=chunk) - Dilutive Impact: Unexercised share options had an anti-dilutive effect, thus no dilutive adjustment was made[175](index=175&type=chunk) [Property, Plant and Equipment](index=61&type=section&id=9.%20Property,%20Plant%20and%20Equipment) For the six months ended June 30, 2025, the Group purchased assets at a cost of RMB 150,085 thousand, disposed of assets with a net book value of RMB 982 thousand, resulting in a net loss on disposal of RMB 732 thousand - Cost of Assets Purchased: **RMB 150,085 thousand** (H1 2024: RMB 370,751 thousand)[177](index=177&type=chunk) - Net Book Value of Assets Disposed: **RMB 982 thousand** (H1 2024: RMB 1,436 thousand)[177](index=177&type=chunk) - Net Loss on Disposal: **RMB 732 thousand** (H1 2024: RMB 1,322 thousand)[177](index=177&type=chunk) [Investments in Associates](index=62&type=section&id=10.%20Investments%20in%20Associates) On May 20, 2025, Neusoft Ruixin, a wholly-owned subsidiary, acquired 4.23% equity in Xikang Yunshe for RMB 30,000 thousand and invested RMB 45,000 thousand, holding approximately 9.93% as of June 30, 2025, and accounted for as an associate due to significant influence - Acquisition of Xikang Yunshe: Acquired **4.23% equity** for **RMB 30,000 thousand** and made a capital contribution of **RMB 45,000 thousand**[178](index=178&type=chunk) - Shareholding Percentage: Approximately **9.93%** as of June 30, 2025[178](index=178&type=chunk) - Accounting Treatment: Accounted for as an associate due to the ability to exercise **significant influence**[178](index=178&type=chunk) [Trade and Bills Receivables](index=62&type=section&id=11

INTERIM REPORT 中期報告 BoardWare Intelligence Technology Limited 博維智慧科技有限公司 BoardWare Intelligence Technology Limited 博維智慧科技有限公司 （於開曼群島註冊成立的有限公司） (incorporated in the Cayman Islands with limited liability) Stock code 股份代號 : 1204 Independent Non-Executive Directors 2025 CONTENTS 目錄 CONTENTS 目錄 2–4 Corporate Information 公司資料 5–17 Management Discussion and Analysis 管理層討論及分析 18–42 Condensed Consolidated Financial Statements 簡明綜合財務報表 43–52 Corporate Governance/Other Information 企業管治╱其他資料 CORPORATE INFORMATION 公司資料 ...

Interim Report 2025中期報告 INTERIM REPORT 2025 中期報告 香港地址：香港九龍尖沙咀廣東道5號海港城海洋中心7樓715室 STOCK CODE 00602 電話：(00852) 3620 2368 Hong Kong Address: Suite 715, 7/F, Ocean Centre, Harbour City, 5 Canton Road, Tsimshatsui, Kowloon Tel: (00852) 3620 2368 設計及製作：安林財經印刷有限公司 www.janfp.com Design & Production: JAN Financial Press Limited www.janfp.com www.szbjh.com Contents 目錄 | Corporate Information | 公司資料 | 2–3 | | --- | --- | --- | | Chairman's Statement | 董事長報告 | 4–16 | | Management Discussion and Analysis | 管理層討論及分析 | 17– ...