AI Health Technology Limited 智慧健康科技有限公司 (股份代號：1715) (於開曼群島註冊成立的有限公司) (前稱火山邑動國際控股有限公司) 2025 2025 INTERIM REPORT 中期報告 AI Health Technology Limited 智慧健康科技有限公司 (Incorporated in the Cayman Islands with limited liability) (Formerly known as Volcano Spring International Holdings Limited) (Stock Code: 1715) 目錄 | 公司資料 | 02 | | --- | --- | | 業務回顧及未來前景 | 03 | | 管理層討論及分析 | 04 | | 簡明綜合中期全面收益表 | 11 | | 簡明綜合中期財務狀況表 | 13 | | 簡明綜合中期權益變動表 | 15 | | 簡明綜合中期現金流量表 | 16 | | 簡明綜合中期財務資料附註 | 17 | | 其他資料 | 24 | 2025年中期報告 智慧健康科技有限公司 02 ...

[Company Information](index=3&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section provides key administrative and contact details for Pak Fah Yeow International Limited, including its board of directors, registered office, auditors, and stock code [Board of Directors and Management](index=3&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E8%88%87%E7%AE%A1%E7%90%86%E5%B1%A4) This section lists the board members of Pak Fah Yeow International Limited, including executive, non-executive, and independent non-executive directors, along with their committee roles - The Board of Directors comprises executive directors (Gan Wee Sean, Gan Fook Wai, Gan Ching Hooi), a non-executive director (Gan Fook Yin), and independent non-executive directors (Leung Man Chiu, Dell'Orto Renato, Chan Chi Chung)[3](index=3&type=chunk) - Mr. Gan Wee Sean serves as Chairman and Chief Executive Officer, while Mr. Leung Man Chiu chairs the Audit, Remuneration, and Nomination Committees[3](index=3&type=chunk) [Company Basic Information](index=3&type=section&id=%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E4%BF%A1%E6%81%AF) This section provides the company's registered office, Hong Kong head office, auditors, share registrars, stock code, website, and email address - The company's registered office is in Bermuda, with its Hong Kong head office and principal place of business located at 11/F, 200 Gloucester Road, Wanchai, Hong Kong[3](index=3&type=chunk) - The auditor is RSM Hong Kong, and the Hong Kong share registrar is Tricor Secretaries Limited[3](index=3&type=chunk) - The company's stock code is **239**, and its website is http://www.pakfahyeow.com[3](index=3&type=chunk) [Executive Summary](index=4&type=section&id=%E6%91%98%E8%A6%81) This section provides a high-level overview of the company's financial performance and dividend declarations for the period [Dividend Declaration](index=4&type=section&id=%E8%82%A1%E6%81%AF%E5%AE%A3%E6%B4%BE) The company declared an interim dividend of 3.0 HK cents and a special interim dividend of 5.0 HK cents per share - An interim dividend of **3.0 HK cents** and a special interim dividend of **5.0 HK cents** per share were declared[4](index=4&type=chunk) [Performance Highlights](index=4&type=section&id=%E6%A5%AD%E7%B8%BE%E6%91%98%E8%A6%81) For the six months ended June 30, 2025, the company's revenue and underlying recurring profit decreased by 28.5% and 26.6% year-on-year, respectively, primarily due to lower healthcare sales Key Financial Data for the Six Months Ended June 30 | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 94,734 | 132,468 | -28.5% | | Reported Profit | 39,743 | 47,407 | -16.2% | | Underlying Recurring Profit | 45,294 | 61,710 | -26.6% | | **Earnings Per Share (HK cents):** | | | | | Reported Profit | 12.8 | 15.2 | -15.8% | | Underlying Recurring Profit | 14.5 | 19.8 | -26.8% | | Total Dividend Per Share | 8.0 | 9.5 | -15.8% | | **Period-end Data (HK$ thousand):** | 2025年6月30日 | 2024年12月31日 | | | Shareholders' Funds | 704,177 | 731,908 | -3.8% | | Net Asset Value Per Share (HK$) | 2.26 | 2.35 | -3.8% | - Revenue and underlying recurring profit decreased by **28.5%** and **26.6%** year-on-year, respectively, primarily due to reduced sales revenue from the healthcare business[7](index=7&type=chunk) - Reported profit decreased by **16.2%**, mainly attributable to lower non-cash fair value losses on investment properties recorded in the first half of 2025[7](index=7&type=chunk) [Management Discussion and Analysis](index=6&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) This section provides a detailed review of the company's business, operations, and financial performance, along with its financial resources, risk management, and future outlook [Business Review](index=6&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) In the first half of 2025, total revenue decreased by 28.5% to HK$94.7 million, primarily due to weak healthcare performance and reduced treasury investment interest income, while reported profit decreased by 16.2% due to lower fair value losses on investment properties - A cautious global economic environment, geopolitical uncertainties, and softening consumer confidence continue to shape the global economic landscape[10](index=10&type=chunk) Revenue by Business Segment (For the Six Months Ended June 30) | Business Segment | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Healthcare | 86,724 | 123,442 | -29.7 | | Property Investment | 4,748 | 4,752 | – | | Treasury Investment | 3,262 | 4,274 | -23.7 | | **Total** | **94,734** | **132,468** | **-28.5** | - Underlying recurring profit decreased by **26.6%** to **HK$45.3 million**, and reported profit decreased by **16.2%** to **HK$39.7 million**[11](index=11&type=chunk)[12](index=12&type=chunk) [Operations Review](index=8&type=section&id=%E7%87%9F%E9%81%8B%E5%9B%9E%E9%A1%A7) Healthcare segment revenue declined significantly due to reduced sales in China and North America, while property investment revenue remained stable with narrowed losses, and treasury investment saw improved performance despite lower income - Healthcare segment revenue decreased by **29.7%** to **HK$86.7 million**, with segment profit decreasing by **31.9%** to **HK$52.4 million**[14](index=14&type=chunk) - China sales revenue decreased by **29.2%** year-on-year, primarily due to a significant drop in Macau sales volume and reduced cross-border traveler spending in Hong Kong; mainland China sales remained largely stable, shifting towards online channels[14](index=14&type=chunk) - Property investment segment revenue remained stable at **HK$4.7 million**, with segment loss significantly narrowing by **72.3%** to **HK$3.0 million**, primarily due to reduced unrealized fair value losses on investment properties[18](index=18&type=chunk) - Treasury investment segment revenue decreased by **23.7%** to **HK$3.3 million**, but underlying recurring segment profit increased by **58.6%** to a profit of **HK$5.9 million**, and segment profit increased by **77.1%** to a profit of **HK$7.4 million**[21](index=21&type=chunk)[22](index=22&type=chunk) [Healthcare](index=8&type=section&id=%E9%86%AB%E7%99%82%E4%BF%9D%E5%81%A5) Healthcare segment revenue and profit declined significantly due to reduced sales in China (Macau and Hong Kong) and North America, while mainland China's online sales showed stable growth - Healthcare segment revenue decreased by **29.7%** to **HK$86.7 million**, with segment profit decreasing by **31.9%** to **HK$52.4 million**[14](index=14&type=chunk) Healthcare Segment Revenue by Region (For the Six Months Ended June 30) | Region | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | China (including Mainland China, Hong Kong and Macau) | 67,687 | 95,660 | -29.2 | | Southeast Asia | 17,993 | 24,108 | -25.4 | | North America | 872 | 3,495 | -75.1 | | Other Regions | 172 | 179 | -3.9 | | **Segment Revenue** | **86,724** | **123,442** | **-29.7** | - China sales revenue decreased by **29.2%** year-on-year, primarily due to a significant drop in Macau sales volume and reduced cross-border traveler spending in Hong Kong; mainland China sales remained largely stable, shifting towards online channels, with the company expanding its e-commerce and digital marketing efforts[14](index=14&type=chunk) - US sales were impacted by tariff uncertainties, leading the Group to adopt a cautious sales strategy in the first half of 2025[17](index=17&type=chunk) [Property Investment](index=9&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) Property investment segment revenue remained stable at HK$4.7 million, with segment loss significantly narrowing by 72.3% due to reduced unrealized fair value losses on investment properties - Property investment segment revenue remained stable at **HK$4.7 million**, with segment loss significantly narrowing by **72.3%** to **HK$3.0 million**, primarily due to reduced unrealized fair value losses on investment properties[18](index=18&type=chunk) Property Investment Segment Revenue by Region (For the Six Months Ended June 30) | Region | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Hong Kong – Office and Residential | 1,591 | 1,723 | -7.7 | | Singapore – Industrial | 171 | 158 | +8.2 | | United Kingdom – Retail/Residential | 2,986 | 2,871 | +4.0 | | **Segment Revenue** | **4,748** | **4,752** | – | | **Segment Result – Loss** | **(2,978)** | **(10,763)** | **-72.3** | - The occupancy rates for these properties were **100.0%**, **100.0%**, and **100.0%**, respectively (2024: 93.4%, 100.0%, and 100.0%)[18](index=18&type=chunk) - The property expense ratio decreased to **13.4%** (2024: 15.4%) during the period, reflecting improved property expense management in 2025[19](index=19&type=chunk) [Treasury Investment](index=10&type=section&id=%E8%B2%A1%E8%B3%87%E6%8A%95%E8%B3%87) Treasury investment segment revenue decreased by 23.7% to HK$3.3 million due to lower bank deposit rates, but underlying recurring segment profit and segment profit significantly increased, reflecting improved investment returns - Segment revenue, primarily from interest income, decreased by **23.7%** to **HK$3.3 million**, reflecting a gradual decline in bank deposit rates during the period[21](index=21&type=chunk) - Underlying recurring segment profit increased by **58.6%** to a profit of **HK$5.9 million**, and segment profit also increased to a profit of **HK$7.4 million**[21](index=21&type=chunk) Reconciliation of Treasury Investment Segment Performance (For the Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Underlying Recurring Segment Profit | 5,888 | 3,713 | +58.6 | | Unrealized Fair Value Changes of Financial Assets | 1,539 | 481 | | | **Segment Result – Profit** | **7,427** | **4,194** | **+77.1** | [Financial Review](index=11&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section details other key financial items beyond business segments, including changes in staff costs, operating expenses, finance costs, taxation, and investment property valuations - Staff costs increased by **5.9%** to **HK$22.1 million**, primarily reflecting annual salary increments and provisions for long service payments[24](index=24&type=chunk) - Other operating expenses decreased by **22.9%** to **HK$10.8 million**, mainly due to a reduction in overall advertising and promotion expenses during the period[25](index=25&type=chunk) - The valuation of the investment property portfolio as at June 30, 2025, was **HK$230.8 million**, a slight increase of **1.6%** from **HK$227.0 million** as at December 31, 2024[28](index=28&type=chunk) [Financial Resources and Treasury Policy](index=13&type=section&id=%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90%E5%8F%8A%E7%90%86%E8%B2%A1%E6%94%BF%E7%AD%96) The company maintains a prudent financial policy, with a capital gearing ratio of 0.7% and a current ratio of 6.5 times as of June 30, 2025, ensuring sufficient liquidity Key Financial Resources Metrics | Metric | 2025年6月30日 | 2024年12月31日 | Change | | :--- | :--- | :--- | :--- | | Capital Gearing Ratio | 0.7% | 0.6% | +0.1% | | Current Ratio | 6.5 times | 16.2 times | -9.7 times | | Total Bank Borrowings | HK$4.8 million | HK$4.2 million | +14.3% | - The Group maintains sufficient cash reserves, marketable securities, and available bank facilities to meet its short-term liabilities, commitments, and working capital requirements[29](index=29&type=chunk) [Exchange Rate Risk](index=13&type=section&id=%E5%8C%AF%E5%85%8C%E9%A2%A8%E9%9A%AA) While most business transactions are in HKD and USD, the company faces approximately HK$70.2 million in foreign exchange risk from overseas securities and bank balances, and HK$108.9 million from UK investment properties - Most of the Group's business transactions are conducted in HKD and USD, with some sales to mainland China and overseas markets denominated in RMB, AUD, and MYR, and rental income from the UK received in GBP[30](index=30&type=chunk) - Foreign exchange risk related to investments in overseas securities and bank balances totals approximately **HK$70.2 million**, or about **8.2%** of the Group's total assets[30](index=30&type=chunk) - The Group also has foreign exchange risk of approximately **HK$108.9 million** (net of related borrowings) due to the carrying value of its investment properties in the UK[30](index=30&type=chunk) [Asset Pledges](index=13&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2025, UK investment properties with a total carrying value of approximately HK$113.7 million were pledged as collateral for bank credit facilities of approximately HK$58.1 million, of which HK$4.8 million was utilized - UK investment properties with a total carrying value of approximately **HK$113.7 million** were pledged as collateral for the Group's bank credit facilities totaling approximately **HK$58.1 million**[31](index=31&type=chunk) - As at June 30, 2025, approximately **HK$4.8 million** of these facilities had been utilized[31](index=31&type=chunk) [Contingent Liabilities](index=14&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2025, the company faced no legal proceedings initiated by third parties or pending claims that could result in significant financial loss - As at June 30, 2025, there were no legal proceedings initiated by any third party against the Group (as defendant), nor any pending claims that could result in significant financial loss to the Group[32](index=32&type=chunk) [Plans for Major Investments or Capital Asset Acquisitions](index=14&type=section&id=%E6%9C%AA%E4%BE%86%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E6%94%B6%E8%B3%BC%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E4%B9%8B%E8%A8%88%E5%8A%83) The company currently has no plans for any major investments or acquisitions of significant capital assets - The Group has no plans for any major investments or acquisitions of significant capital assets[33](index=33&type=chunk) [Employees and Remuneration Policy](index=14&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the company had 100 employees, a decrease of 6 from the end of 2024, with remuneration reviewed annually based on market conditions and individual performance - As at June 30, 2025, the Group had **100 employees** (December 31, 2024: 106 employees)[34](index=34&type=chunk) - The Group annually reviews and determines employee and director remuneration packages with reference to market conditions and individual performance, providing additional benefits such as medical and education allowances to eligible employees[34](index=34&type=chunk) [Outlook](index=14&type=section&id=%E5%B1%95%E6%9C%9B) The company maintains a cautious outlook for the second half of 2025, anticipating continued challenges in the healthcare segment in China and aiming to optimize returns through prudent treasury management - For the second half of 2025, the Group maintains a cautious outlook due to ongoing global uncertainties, interest rate impacts, and prudent consumer confidence in the operating environment[35](index=35&type=chunk) - The healthcare segment is expected to continue facing challenges in China, with the Group accelerating its e-commerce initiatives and digital marketing to capture emerging demand[35](index=35&type=chunk) - The Group will continue to optimize returns through prudent treasury management, maintaining a diversified investment portfolio and prioritizing capital preservation[35](index=35&type=chunk) [Independent Auditor's Review Report on Condensed Interim Financial Information](index=15&type=section&id=%E7%B0%A1%E6%98%8E%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E7%9A%84%E7%8D%A8%E7%AB%8B%E6%A0%B8%E6%95%B8%E5%B8%AB%E5%AF%A9%E9%96%B1%E5%A0%B1%E5%91%8A) This section presents the independent auditor's review report on the company's condensed interim financial information for the six months ended June 30, 2025 [Scope of Review and Conclusion](index=15&type=section&id=%E5%AF%A9%E9%96%B1%E7%AF%84%E5%9C%8D%E8%88%87%E7%B5%90%E8%AB%96) RSM Hong Kong reviewed Pak Fah Yeow International Limited's condensed interim financial information for the six months ended June 30, 2025, finding no material issues indicating non-compliance with HKAS 34 - The auditor has reviewed the condensed interim financial information on pages 16 to 37, which includes Pak Fah Yeow International Limited and its subsidiaries' condensed consolidated statement of financial position as at June 30, 2025, and the related condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity, condensed consolidated cash flow statement, and other explanatory notes for the six months then ended[37](index=37&type=chunk) - The scope of a review is substantially less than that of an audit conducted in accordance with Hong Kong Standards on Auditing, and consequently, it does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit; accordingly, we do not express an audit opinion[38](index=38&type=chunk) - Based on our review, nothing has come to our attention that causes us to believe that the condensed interim financial information is not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34[39](index=39&type=chunk) [Condensed Consolidated Statement of Comprehensive Income](index=17&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) This section presents the company's condensed consolidated statement of comprehensive income, detailing revenue, profit, and other comprehensive income for the period [Overview of Period Performance](index=17&type=section&id=%E6%9C%9F%E5%85%A7%E6%A5%AD%E7%B8%BE%E6%A6%82%E8%A6%BD) For the six months ended June 30, 2025, the company's revenue was HK$94.7 million, a 28.5% decrease year-on-year, with profit for the period at HK$39.7 million, down 16.2% Key Data from Condensed Consolidated Statement of Comprehensive Income (For the Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 94,734 | 132,468 | | Operating Profit | 48,427 | 60,883 | | Profit Before Tax | 48,015 | 60,443 | | Profit for the Period Attributable to Owners of the Company | 39,743 | 47,407 | | Total Comprehensive Income for the Period Attributable to Owners of the Company | 4,991 | 23,624 | | Basic and Diluted Earnings Per Share (cents) | 12.8 | 15.2 | - Revenue decreased by **28.5%** year-on-year, and profit for the period decreased by **16.2%** year-on-year[41](index=41&type=chunk) - Other comprehensive loss was primarily due to an increased deficit from the revaluation of leasehold land and buildings to **HK$41.2 million**, resulting in a significant reduction in total comprehensive income[42](index=42&type=chunk) [Condensed Consolidated Statement of Financial Position](index=19&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) This section presents the company's condensed consolidated statement of financial position, outlining its assets, liabilities, and equity as of June 30, 2025 [Overview of Assets and Liabilities](index=19&type=section&id=%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E6%A6%82%E8%A6%BD) As of June 30, 2025, total assets were HK$852.2 million, with a slight increase, driven by a significant rise in bank balances and cash, while current liabilities increased substantially due to higher dividends payable, leading to a decrease in shareholders' funds Key Data from Condensed Consolidated Statement of Financial Position | Metric | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Non-current Assets | 455,719 | 504,113 | | Current Assets | 396,527 | 339,241 | | Current Liabilities | 61,286 | 20,887 | | Net Current Assets | 335,241 | 318,354 | | Total Assets Less Current Liabilities | 790,960 | 822,467 | | Net Assets | 704,177 | 731,908 | | Share Capital | 15,582 | 15,582 | | Share Premium and Reserves | 688,595 | 716,326 | | Total Equity | 704,177 | 731,908 | - Bank balances and cash increased from **HK$275.8 million** to **HK$343.8 million**[44](index=44&type=chunk) - Dividends payable significantly increased from **HK$1.0 million** to **HK$33.6 million**[44](index=44&type=chunk) - Shareholders' funds (total equity) decreased from **HK$731.9 million** to **HK$704.2 million**[45](index=45&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=21&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) This section presents the company's condensed consolidated statement of changes in equity, detailing movements in shareholders' funds for the period [Changes in Shareholders' Equity](index=21&type=section&id=%E8%82%A1%E6%9D%B1%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95) For the six months ended June 30, 2025, total equity decreased from HK$731.9 million to HK$704.2 million, primarily due to profit for the period, other comprehensive losses from property revaluation, and declared dividends - As at June 30, 2025, total equity was **HK$704.2 million**, a decrease from **HK$731.9 million** as at January 1, 2025[47](index=47&type=chunk) - Profit for the period was **HK$39.7 million**, but other comprehensive loss amounted to **HK$34.8 million**, primarily due to property revaluation deficits[47](index=47&type=chunk) - Interim and special interim dividends totaling **HK$32.7 million** were declared[47](index=47&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=22&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) This section presents the company's condensed consolidated statement of cash flows, detailing cash movements from operating, investing, and financing activities [Overview of Cash Flows](index=22&type=section&id=%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E6%A6%82%E8%A6%BD) For the six months ended June 30, 2025, the company generated HK$67.2 million net cash from operations, used HK$5.6 million in investing activities, and HK$0.3 million in financing activities, resulting in a net increase of HK$61.3 million in cash and cash equivalents Key Data from Condensed Consolidated Statement of Cash Flows (For the Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 67,163 | 88,181 | | Net Cash Used in Investing Activities | (5,644) | (11,207) | | Net Cash Used in Financing Activities | (254) | (883) | | Net Increase in Cash and Cash Equivalents | 61,265 | 76,091 | | Cash and Cash Equivalents at End of Period | 333,077 | 338,689 | - Net cash generated from operating activities decreased year-on-year from **HK$88.2 million** to **HK$67.2 million**[48](index=48&type=chunk) - Net cash used in investing activities decreased, primarily due to a smaller increase in time deposits and reduced expenditure on property, plant, and equipment[48](index=48&type=chunk) [Notes to the Condensed Interim Financial Information](index=23&type=section&id=%E7%B0%A1%E6%98%8E%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E8%A8%BB%E9%87%8B) This section provides detailed explanatory notes to the condensed interim financial information, covering basis of preparation, accounting policies, segment information, and other financial disclosures [Basis of Preparation](index=23&type=section&id=%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) The condensed interim financial information is prepared in accordance with HKAS 34 "Interim Financial Reporting" and the disclosure requirements of the HKEX Listing Rules, and has been reviewed by the company's audit committee - The interim financial information is prepared in accordance with the applicable disclosure requirements of Appendix D2 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[49](index=49&type=chunk) - The interim financial information is unaudited but has been reviewed by the Company's Audit Committee[50](index=50&type=chunk) [Significant Accounting Policies](index=23&type=section&id=%E4%B8%BB%E8%A6%81%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) The condensed interim financial information is prepared using the historical cost convention, with investment properties, leasehold land and buildings, and financial assets at fair value through profit or loss measured at fair value, and new accounting standards had no material impact - The interim financial information is prepared under the historical cost convention, except for investment properties, leasehold land and buildings, and financial assets at fair value through profit or loss, which are measured at fair value[51](index=51&type=chunk) - The adoption of these amendments to Hong Kong Financial Reporting Standards had no significant impact on the Group's interim financial information[52](index=52&type=chunk) [Operating Segment Information](index=24&type=section&id=%E7%B6%93%E7%87%9F%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The company operates in healthcare, property investment, and treasury investment segments, with healthcare revenue and results significantly declining, property investment revenue stable with narrowed losses, and treasury investment showing improved performance despite lower income - The Group's operating segments are established and managed separately based on their business nature, categorized into three operating businesses: healthcare, property investment, and treasury investment[53](index=53&type=chunk)[54](index=54&type=chunk) Revenue and Results by Business Segment (For the Six Months Ended June 30) | Segment | 2025 Revenue (HK$ thousand) | 2024 Revenue (HK$ thousand) | 2025 Results (HK$ thousand) | 2024 Results (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Healthcare | 86,724 | 123,442 | 52,386 | 76,974 | | Property Investment | 4,748 | 4,752 | (2,978) | (10,763) | | Treasury Investment | 3,262 | 4,274 | 7,427 | 4,194 | | **Consolidated** | **94,734** | **132,468** | **48,427 (Operating Profit)** | **60,883 (Operating Profit)** | Sales Revenue and Operating Results by Region (For the Six Months Ended June 30) | Region | 2025 Sales Revenue (HK$ thousand) | 2024 Sales Revenue (HK$ thousand) | 2025 Operating Results (HK$ thousand) | 2024 Operating Results (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | China | 71,764 | 100,588 | 37,518 | 51,567 | | Southeast Asia | 18,748 | 24,674 | 14,238 | 14,526 | | North America | 872 | 3,855 | 391 | 2,159 | | United Kingdom | 3,178 | 3,172 | 3,077 | 1,312 | [Other Income](index=27&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5) For the six months ended June 30, 2025, other income totaled HK$66 thousand, primarily from dividend income on listed investments, a decrease from HK$85 thousand in the prior year Other Income (For the Six Months Ended June 30) | Source | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Dividend Income from Financial Assets | 67 | 84 | | (Loss) Gain on Disposal of Financial Assets | (1) | 1 | | **Total** | **66** | **85** | [Other Net Gains](index=28&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E6%B7%A8%E9%A1%8D) For the six months ended June 30, 2025, other net gains amounted to HK$158 thousand, a decrease from HK$290 thousand in the prior year Other Net Gains (For the Six Months Ended June 30) | Source | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Miscellaneous Gains | 158 | 290 | [Profit Before Tax](index=28&type=section&id=%E9%99%A4%E7%A8%85%E5%89%8D%E6%BA%A2%E5%88%A9) Profit before tax is calculated after deducting finance costs and other items such as cost of inventories; for the six months ended June 30, 2025, finance costs were HK$412 thousand and cost of inventories was HK$23.3 million Finance Costs and Cost of Inventories (For the Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Interest on Bank Borrowings | 132 | 160 | | Interest on Consideration Payable for Acquisition of Trademark | 280 | 280 | | **Total Finance Costs** | **412** | **440** | | Cost of Inventories | 23,343 | 30,597 | [Taxation](index=28&type=section&id=%E7%A8%85%E9%A0%85) Taxation decreased from HK$13.0 million to HK$8.3 million, primarily due to a reduction in the overall assessable operating profit of subsidiaries, with Hong Kong profits tax applying a two-tiered rate and overseas taxes provisioned at applicable rates Taxation Expense (For the Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong Profits Tax | 7,822 | 12,582 | | Overseas Taxation | 621 | 591 | | Deferred Taxation | (171) | (137) | | **Total Taxation** | **8,272** | **13,036** | - Taxation decreased primarily due to a reduction in the overall assessable operating profit of subsidiaries[27](index=27&type=chunk) [Dividends](index=29&type=section&id=%E8%82%A1%E6%81%AF) The directors recommended a final dividend of 3.8 HK cents and a special final dividend of 6.7 HK cents per share for 2024, while interim and special interim dividends declared for the current period totaled HK$24.9 million, down from HK$29.6 million last year - The directors recommended a final dividend of **3.8 HK cents** and a special final dividend of **6.7 HK cents** per share for the year ended December 31, 2024[66](index=66&type=chunk) Dividends Attributable to the Period (For the Six Months Ended June 30) | Dividend Type | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Interim Dividend (3.0 HK cents per share) | 9,349 | 9,349 | | Special Interim Dividend (5.0 HK cents per share) | 15,582 | 20,257 | | **Total** | **24,931** | **29,606** | - The total interim and special interim dividends declared in 2025 amounted to **HK$24.9 million**, a decrease from **HK$29.6 million** in 2024[69](index=69&type=chunk) [Earnings Per Share](index=30&type=section&id=%E6%AF%8F%E8%82%A1%E7%9B%88%E5%88%A9) Basic and diluted earnings per share for the period were 12.8 HK cents, calculated based on profit attributable to owners of HK$39.7 million and a weighted average of 311.6 million ordinary shares outstanding, with diluted EPS equaling basic EPS due to no dilutive potential ordinary shares - Basic and diluted earnings per share are calculated based on the profit for the period attributable to owners of the Company of **HK$39.7 million** and the weighted average of **311.6 million** ordinary shares outstanding during the period[70](index=70&type=chunk) - As there were no unissued ordinary shares with dilutive potential for the six months ended June 30, 2025, and 2024, diluted earnings per share are equal to basic earnings per share[70](index=70&type=chunk) [Changes in Investment Properties and Property, Plant and Equipment](index=30&type=section&id=%E6%8A%95%E8%B3%87%E7%89%A9%E6%A5%AD%E4%BB%A5%E5%8F%8A%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99%E4%B9%8B%E8%AE%8A%E5%8B%95) Hong Kong investment properties and leasehold land and buildings recorded revaluation deficits of HK$7.1 million and HK$49.3 million, respectively, while UK investment properties saw a foreign exchange adjustment surplus of HK$10.8 million, and HK$77 thousand was spent on property, plant, and equipment - The Group recorded a net revaluation deficit of **HK$7.09 million** for its investment properties located in Hong Kong during the period, which has been recognized in the profit or loss[71](index=71&type=chunk) - The Group recorded a revaluation deficit of **HK$49.3 million** for its leasehold land and buildings located in Hong Kong during the period, which has been recognized in the property revaluation reserve[71](index=71&type=chunk) - During the period, the Group recorded a foreign exchange adjustment surplus of **HK$10.8 million** for its investment properties located in the United Kingdom[71](index=71&type=chunk) - During the period, the Group acquired property, plant, and equipment totaling **HK$77 thousand**[72](index=72&type=chunk) [Trade and Other Receivables](index=31&type=section&id=%E6%87%89%E6%94%B6%E8%B3%A6%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other receivables significantly decreased to HK$19.0 million from HK$33.2 million at the end of 2024, with trade receivables having credit terms ranging from 30 to 120 days Trade and Other Receivables | Item | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Trade Receivables | 9,689 | 19,190 | | Bills Receivable | 5,922 | 9,529 | | Other Receivables | 3,412 | 4,498 | | **Total** | **19,023** | **33,217** | Ageing Analysis of Trade Receivables | Ageing | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Within 30 days | 4,013 | 14,638 | | 31 – 60 days | 2,284 | 1,537 | | 61 – 90 days | 2,149 | 1,917 | | 91 – 120 days | 1,243 | 1,098 | | **Total** | **9,689** | **19,190** | - The total amount of trade and other receivables significantly decreased, primarily due to reductions in trade receivables and bills receivable[73](index=73&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=32&type=section&id=%E6%96%BC%E6%90%8D%E7%9B%8A%E8%B3%87%E4%BB%A5%E5%85%AC%E5%B9%B3%E5%80%BC%E5%88%97%E8%B3%87%E4%B9%8B%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) As of June 30, 2025, financial assets at fair value through profit or loss totaled HK$22.9 million, primarily comprising unlisted mutual funds, dual currency deposits, unlisted debt securities, and Hong Kong listed equity securities Details of Major Financial Asset Investments (June 30, 2025) | Investment Type | Fair Value/Market Value (HK$ thousand) | Approximate Percentage of Investment Portfolio (%) | Approximate Percentage of Net Assets (%) | | :--- | :--- | :--- | :--- | | KBC Eco Fund SICAV-Water capitalisation (Unlisted Mutual Fund) | 5,730 | 25.03 | 0.81 | | Multipartner SICAV-RobecoSAM Sustainable Water Fund B-capitalisation (Unlisted Mutual Fund) | 3,879 | 16.95 | 0.55 | | UBS (Dual Currency Deposit) | 3,937 | 17.20 | 0.56 | | Deep Water Bay Yacht Club Limited (Unlisted Debt Securities) | 2,785 | 12.17 | 0.40 | | Shenzhen Xili Golf and Country Club (Unlisted Debt Securities) | 1,842 | 8.05 | 0.26 | | HSBC Holdings plc (Hong Kong Listed Equity Securities) | 1,310 | 5.72 | 0.19 | | **Total** | **22,888** | **100.00** | **3.25** | - As at June 30, 2025, the total value of financial assets at fair value through profit or loss was **HK$22.9 million**, an increase from **HK$19.1 million** as at December 31, 2024[74](index=74&type=chunk)[75](index=75&type=chunk) [Secured Bank Borrowings](index=34&type=section&id=%E6%9C%89%E6%8A%B5%E6%8A%BC%E9%8A%80%E8%A1%8C%E5%80%9F%E8%B2%B8) As of June 30, 2025, secured bank borrowings repayable within one year amounted to HK$4.8 million, bearing interest at the bank's cost of funds plus 1.44% per annum, collateralized by UK investment properties with a total carrying value of HK$113.7 million and rental income Secured Bank Borrowings | Item | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Bank Borrowings Repayable Within One Year | 4,789 | 4,204 | - The revolving loan bears interest at the bank's cost of funds plus **1.44%** per annum and is repayable within one month of drawdown[76](index=76&type=chunk) - The loan is secured by the Group's investment properties with a total carrying value of **HK$113.7 million** and the assignment of rental income generated from these investment properties[76](index=76&type=chunk) [Trade and Other Payables](index=34&type=section&id=%E6%87%89%E4%BB%98%E8%B3%A6%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other payables increased to HK$16.5 million from HK$13.9 million at the end of 2024, with most trade payables due within 30 days Trade and Other Payables | Item | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Trade Payables | 3,586 | 1,444 | | Accrued Expenses and Other Payables | 4,768 | 6,610 | | Accrued Advertising and Promotion Expenses | 6,501 | 5,382 | | Accrued Rebates and Discounts | 1,645 | 505 | | **Total** | **16,500** | **13,941** | Ageing Analysis of Trade Payables | Ageing | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Within 30 days | 3,558 | 1,054 | | 31 – 60 days | 11 | 373 | | 61 – 90 days | – | – | | Over 90 days | 17 | 17 | | **Total** | **3,586** | **1,444** | [Share Capital](index=35&type=section&id=%E8%82%A1%E6%9C%AC) As of June 30, 2025, the company's authorized share capital remained at 600 million ordinary shares of HK$0.05 each, totaling HK$30.0 million, with 311.6 million issued and fully paid shares, totaling HK$15.6 million, unchanged from the end of 2024 Share Capital Details | Item | 2025年6月30日 (Number of Shares) | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (Number of Shares) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Authorized Share Capital (Ordinary Shares of HK$0.05 each) | 600,000,000 | 30,000 | 600,000,000 | 30,000 | | Issued and Fully Paid Share Capital | 311,640,000 | 15,582 | 311,640,000 | 15,582 | - During the reporting period, the company's authorized share capital and issued and fully paid share capital remained unchanged[78](index=78&type=chunk) [Pledged Assets](index=36&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2025, the company's UK investment properties with a total carrying value of HK$113.7 million were pledged as collateral for bank credit facilities of HK$58.1 million, of which HK$4.8 million was utilized - The Group's investment properties in the UK are pledged as collateral for bank credit facilities (including bank borrowings) totaling **HK$58.1 million** obtained by the Group[79](index=79&type=chunk) Carrying Value of Pledged Assets | Item | 2025年6月30日 (HK$ thousand) | 2024年12月31日 (HK$ thousand) | | :--- | :--- | :--- | | Investment Properties | 113,678 | 102,854 | [Related Party Transactions](index=36&type=section&id=%E9%97%9C%E9%80%A3%E4%BA%BA%E5%A3%AB%E4%BA%A4%E6%98%93) During the period, the company paid HK$8.96 million in salaries and other benefits to key management personnel, including directors, and HK$36 thousand in contributions to defined contribution plans Remuneration Paid to Key Management Personnel (Including Directors) (For the Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Salaries and Other Benefits | 8,960 | 9,186 | | Contributions to Defined Contribution Plans | 36 | 36 | [Fair Value Disclosure](index=36&type=section&id=%E5%85%AC%E5%B9%B3%E5%80%BC%E6%8A%AB%E9%9C%B2) This section discloses financial assets measured at fair value, categorized into three levels under HKFRS 13, with total financial assets at fair value through profit or loss amounting to HK$22.9 million as of June 30, 2025 - Financial assets measured at fair value are categorized into Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs)[81](index=81&type=chunk) Financial Assets Measured at Fair Value (June 30, 2025) | Item | Total (HK$ thousand) | Level 1 (HK$ thousand) | Level 2 (HK$ thousand) | Level 3 (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Hong Kong Listed Equity Securities | 3,132 | 3,132 | – | – | | Overseas Listed Equity Securities | 81 | 81 | – | – | | Unlisted Mutual Funds | 10,884 | – | 10,884 | – | | Unlisted Debt Securities | 4,823 | 4,823 | – | – | | Unlisted Private Equity Funds | 31 | – | – | 31 | | Dual Currency Deposits | 3,937 | 3,937 | – | – | | **Total** | **22,888** | **11,973** | **10,884** | **31** | - Unlisted mutual funds are valued based on market quotes from traders, referencing market prices of similar instruments[85](index=85&type=chunk) - The fair value of unlisted private equity funds is estimated by external fund managers, referencing various factors such as operating cash flows, financial performance, and industry trends[86](index=86&type=chunk) [Disclosure of Interests and Other Information](index=39&type=section&id=%E6%AC%8A%E7%9B%8A%E6%8A%AB%E9%9C%B2%E5%8F%8A%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) This section provides details on directors' and major shareholders' interests in securities, arrangements for share acquisitions, and other corporate governance information [Directors' Securities Interests](index=39&type=section&id=%E8%91%A3%E4%BA%8B%E4%B9%8B%E8%AD%89%E5%88%B8%E6%AC%8A%E7%9B%8A) As of June 30, 2025, Mr. Gan Wee Sean held 94.9 million shares (30.46%), Mr. Gan Fook Wai held 73.3 million shares (23.51%), and Ms. Gan Fook Yin held 1.2 million shares (0.38%) in the company, with disclosures also made for their long positions in unvoting deferred shares of associated companies Directors' Long Positions in the Company's Shares (June 30, 2025) | Director's Name | Personal Interests (shares) | Family Interests (shares) | Corporate Interests (shares) | Total (shares) | Percentage of Issued Shares (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Gan Wee Sean | 27,208,322 | 2,380,560 | 65,323,440 | 94,912,322 | 30.46 | | Mr. Gan Fook Wai | 10,746,879 | – | 62,527,920 | 73,274,799 | 23.51 | | Ms. Gan Fook Yin | 1,190,280 | – | – | 1,190,280 | 0.38 | - Hexagan Enterprises Limited, a company wholly owned by Mr. Gan Wee Sean and his wife, beneficially owns **65,323,440 shares**[90](index=90&type=chunk) - Gan's Enterprises Limited, a company in which Mr. Gan Fook Wai holds approximately a **32%** interest, beneficially owns **62,527,920 shares**[90](index=90&type=chunk) [Major Shareholders](index=41&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1) As of June 30, 2025, excluding directors and their associates, Mr. Jonathan William Brooke was a major shareholder, holding 37.4 million shares, representing 12.00% of the company's issued shares Major Shareholders' Long Positions in the Company's Shares and Related Shares (June 30, 2025) | Shareholder's Name | Personal Interests (shares) | Family Interests (shares) | Corporate Interests (shares) | Total (shares) | Percentage of Issued Shares (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Jonathan William Brooke | 21,815,000 | – | 15,582,500 | 37,397,500 | 12.00 | - Mr. Jonathan William Brooke holds **100%** of the issued shares of Brooke Capital Limited and Fort Galle Limited, and is therefore deemed to have an interest in these **15,582,500 shares**[92](index=92&type=chunk) [Arrangements for Acquiring Shares or Debentures](index=42&type=section&id=%E6%94%B6%E8%B3%BC%E8%82%A1%E4%BB%BD%E6%88%96%E5%82%B5%E6%AC%8A%E8%AD%89%E4%B9%8B%E5%AE%89%E6%8E%92) Neither the company nor any of its subsidiaries entered into any arrangements during the reporting period that would enable the company's directors to acquire benefits by purchasing shares or debentures of the company or any other body corporate - Neither the company nor any of its subsidiaries entered into any arrangements during the period that would enable the company's directors to acquire benefits by purchasing shares or debentures of the company or any other body corporate[93](index=93&type=chunk) [Other Information](index=42&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) The Board declared an interim dividend of 3.0 HK cents and a special interim dividend of 5.0 HK cents per share, payable on December 5, 2025, with share registration suspended from October 2 to October 6, 2025, and the company adheres to its corporate governance code - The directors resolved to declare an interim dividend of **3.0 HK cents** and a special interim dividend of **5.0 HK cents** per share for the six months ended June 30, 2025, payable to shareholders whose names appear on the register of members on October 6, 2025[94](index=94&type=chunk) - The company's share registration will be suspended from Thursday, October 2, 2025, to Monday, October 6, 2025 (both dates inclusive)[95](index=95&type=chunk) - The company has adopted the Corporate Governance Code set out in Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited as its own corporate governance code[97](index=97&type=chunk) - The roles of Chairman and Chief Executive Officer are performed by the same individual, but the Board believes that sufficient balance of power and safeguards are in place[98](index=98&type=chunk) - The Audit Committee has reviewed the company's interim financial information for the six months ended June 30, 2025, and this interim report[100](index=100&type=chunk)

Property Management Overview - As of June 30, 2025, the Group had a total contracted gross floor area (GFA) of approximately 46.0 million sq.m. across 247 contracted projects[6]. - The Group's residential property management segment included 216 contracted projects with a total contracted GFA of approximately 42.1 million sq.m.[16]. - The commercial property management segment had 31 contracted properties with a total contracted GFA of approximately 3.9 million sq.m.[15]. - The total GFA under management was approximately 35.0 million sq.m., with 217 projects under management[6]. - The total GFA under management for residential properties was approximately 33.3 million sq.m. across 203 projects[16]. - The Group operates in 57 cities across 18 provinces, municipalities, and autonomous regions in China[5]. - The Group's services cover key economic zones including the West Taiwan Strait Economic Zone and the Yangtze River Delta Economic Zone[15]. Revenue and Financial Performance - The total revenue for the period was RMB588.28 million, down from RMB622.51 million in the previous year[21]. - Revenue from the Yangtze River Delta Economic Zone was RMB33.36 million, down from RMB59.43 million in the previous year[25]. - Revenue from the West Taiwan Strait Economic Zone was RMB60.62 million, down from RMB82.79 million year-on-year[25]. - Revenue from the Bohai Rim Economic Zone decreased to RMB48.25 million from RMB61.06 million[25]. - The commercial property management and operational services segment recorded total revenue of approximately RMB169.1 million, representing a year-on-year decrease of approximately 23.8%[22]. - Revenue from basic residential property management services increased by approximately 9.3% from approximately RMB355.6 million in the first half of 2024 to approximately RMB388.7 million, accounting for approximately 66.1% of total revenue[50][53]. - Revenue from value-added services decreased significantly to RMB84,878,000 from RMB117,378,000, a decline of 27.7%[166]. Profitability and Earnings - Profit attributable to owners of the parent decreased significantly by approximately 57.6% from approximately RMB80.4 million in the first half of 2024 to approximately RMB34.1 million, with basic earnings per share amounting to approximately RMB1.76 cents[63][68]. - Gross profit decreased by approximately 13.0% from approximately RMB209.1 million in the first half of 2024 to approximately RMB182.1 million, with the overall gross profit margin decreasing from approximately 33.6% to approximately 30.9%[55][56]. - The company reported a profit of RMB34,120,000 for the six months ended June 30, 2025, compared to RMB80,432,000 for the same period in 2024, reflecting a decrease of approximately 57.6%[147]. - Total comprehensive income for the period was RMB35,117,000, down from RMB79,897,000 in the previous year, indicating a decline of about 56.1%[147]. Operational Strategies and Initiatives - The Group aims to enhance service quality through a three-dimensional service framework, including "Butler-Style Service", "Hotel-Style Service", and "Full-cycle One-stop Service"[39]. - Future strategies include continuous monitoring of local consumption trends and refining tenant sourcing strategies based on project positioning and sales per sq.m.[42]. - The Group plans to leverage digital technologies to enhance operational quality and efficiency while maintaining high-quality commercial content[43]. - The Group's digital intelligence strategy was strengthened to analyze consumer behavior and upgrade the membership benefits system[33]. Employee and Cost Management - The total employee cost for the period was approximately RMB220.0 million, down from approximately RMB268.0 million for the six months ended June 30, 2024, representing a decrease of about 18%[87]. - The Group employed 4,621 employees as of June 30, 2025, a reduction of 272 employees compared to 4,893 employees as of December 31, 2024[87]. - Administrative expenses increased by approximately 16.8% from approximately RMB120.0 million in the first half of 2024 to approximately RMB140.2 million, primarily due to impairment losses of trade receivables[61][66]. Cash Flow and Financial Position - As of June 30, 2025, the Group's cash and bank balances totaled RMB1,196,296,000, a decrease of approximately 7.9% from RMB1,299,809,000 as of December 31, 2024[75]. - The company reported a net increase in cash and cash equivalents of RMB195,221,000 for the period, compared to RMB456,808,000 in the previous year, a decrease of about 57.3%[147]. - Cash generated from operations was RMB57,658,000, a decrease of 41.7% compared to RMB98,915,000 in the prior year[147]. - The company’s total equity at June 30, 2025, was RMB2,775,965,000, compared to RMB2,733,885,000 at the beginning of the year, indicating a growth of approximately 1.5%[147]. Shareholding and Corporate Governance - The company raised total net proceeds of approximately HK$2,037.5 million from the initial public offering, with an offer price of HK$3.7 per share for 575,000,000 shares issued[94][97]. - The Audit Committee consists of three independent non-executive Directors, ensuring compliance with the Listing Rules[127]. - The company has maintained compliance with all applicable code provisions under the Corporate Governance Code during the period[126]. - Significant shareholder Mr. Dan Weijian holds a 35.41% stake in the company, representing approximately 26.05% of the total issued shares[124]. Risks and Liabilities - China SCE Holdings defaulted on a payment of an installment of principal and interest under its syndicated loan agreement, leading to a cross default situation[120]. - The liabilities of China SCE Holdings are secured by charges over 504,000,000 shares in the Company, which represent approximately 26.05% of the total number of issued shares[122]. - The enforcement action taken by banks over the charged shares indicates potential liquidity issues for China SCE Holdings[120].

Corporate Information [Corporate Information Details](index=2&type=section&id=Corporate%20Information%20Details) This section details Dragon Mining Limited's corporate information, including board composition, key advisors, registration details, and its primary engagement in gold mining and mineral exploration - The company's board includes Chairman and Non-Executive Director Arthur George Dew and CEO and Executive Director Brett Robert Smith, supported by an **Audit and Risk Management Committee**, **Remuneration Committee**, and **Nomination Committee**[5](index=5&type=chunk)[7](index=7&type=chunk) - The company is incorporated in Australia, with principal places of business in Perth, Australia, and Wan Chai, Hong Kong, and a **stock code of 1712**[8](index=8&type=chunk)[9](index=9&type=chunk)[10](index=10&type=chunk) - The Group is a for-profit entity primarily engaged in **gold mining operations** and **gold mineral exploration**[21](index=21&type=chunk)[22](index=22&type=chunk) Consolidated Interim Financial Statements [Consolidated Interim Statement of Profit or Loss](index=5&type=section&id=Consolidated%20Interim%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2025, the company achieved a profit before tax of AUD 18.044 million, a significant increase driven by substantial growth in revenue from customers Consolidated Interim Statement of Profit or Loss Key Data (For the 6 months ended June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Revenue from customers | 54,460 | 30,678 | | Cost of sales | (27,839) | (26,800) | | Gross profit | 26,621 | 3,878 | | Other gains | 724 | 330 | | Other income | 418 | 2,025 | | Mineral exploration expenditure | (433) | (88) | | Management and administrative expenses | (4,009) | (2,621) | | Other operating expenses | (592) | (598) | | Finance costs | (648) | (616) | | Fair value (loss)/gain on financial assets | (49) | 310 | | Foreign exchange (loss)/gain | (3,988) | 329 | | Profit before tax | 18,044 | 2,949 | | Income tax expense | (5,352) | (978) | | Profit after income tax | 12,692 | 1,971 | | Basic and diluted earnings per share (AUD cents/share) | 8.03 | 1.25 | - Revenue from customers increased by **77.5%** year-on-year, from **AUD 30,678 thousand** in 2024 to **AUD 54,460 thousand** in 2025[12](index=12&type=chunk) - Gross profit significantly increased by **586.5%**, from **AUD 3,878 thousand** in 2024 to **AUD 26,621 thousand** in 2025[12](index=12&type=chunk) [Consolidated Interim Statement of Other Comprehensive Income](index=6&type=section&id=Consolidated%20Interim%20Statement%20of%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the company reported total comprehensive income of AUD 19.802 million, primarily due to a favorable foreign exchange difference on translation of overseas operations Consolidated Interim Statement of Other Comprehensive Income Key Data (For the 6 months ended June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Profit after income tax (brought forward) | 12,692 | 1,971 | | Exchange difference on translation of overseas operations | 7,110 | (1,298) | | Total comprehensive income for the period | 19,802 | 673 | - The exchange difference on translation of overseas operations shifted from a **loss of AUD 1,298 thousand** in the prior period of 2024 to a **gain of AUD 7,110 thousand** in 2025[14](index=14&type=chunk) [Consolidated Interim Statement of Financial Position](index=7&type=section&id=Consolidated%20Interim%20Statement%20of%20Financial%20Position) As of June 30, 2025, total assets increased to AUD 165.627 million and net assets to AUD 102.566 million, mainly driven by increases in property, plant, and equipment and other assets Consolidated Interim Statement of Financial Position Key Data (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Total current assets | 64,459 | 64,832 | | Total non-current assets | 101,168 | 67,740 | | Total assets | 165,627 | 132,572 | | Total current liabilities | 22,715 | 15,324 | | Total non-current liabilities | 40,346 | 34,484 | | Total liabilities | 63,061 | 49,808 | | Net assets | 102,566 | 82,764 | | Total equity | 102,566 | 82,764 | - Total non-current assets increased by **49.3%**, from **AUD 67,740 thousand** as of December 31, 2024, to **AUD 101,168 thousand** as of June 30, 2025[15](index=15&type=chunk) - Total liabilities increased by **26.6%**, from **AUD 49,808 thousand** as of December 31, 2024, to **AUD 63,061 thousand** as of June 30, 2025[15](index=15&type=chunk) [Consolidated Interim Statement of Changes in Equity](index=8&type=section&id=Consolidated%20Interim%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, total equity increased to AUD 102.566 million, primarily due to profit after tax and an increase in foreign currency translation reserve during the period Consolidated Interim Statement of Changes in Equity Key Data (For the 6 months ended June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Total equity at beginning of period (January 1) | 82,764 | 68,758 | | Profit after income tax for the period | 12,692 | 1,971 | | Other comprehensive income/(loss) | 7,110 | (1,298) | | Total comprehensive income for the period | 19,802 | 673 | | Total equity at end of period (June 30) | 102,566 | 69,431 | - Accumulated losses decreased from **AUD 59,171 thousand** as of January 1, 2025, to **AUD 46,479 thousand** as of June 30, 2025, reflecting improved profitability[16](index=16&type=chunk) - Foreign exchange reserve shifted from a **negative AUD 1,610 thousand** as of January 1, 2025, to a **positive AUD 5,500 thousand** as of June 30, 2025, indicating a positive impact from exchange rate movements[16](index=16&type=chunk) [Consolidated Interim Statement of Cash Flows](index=9&type=section&id=Consolidated%20Interim%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash from operating activities significantly increased, but net cash used in investing activities also rose substantially, leading to a net decrease in cash and cash equivalents Consolidated Interim Statement of Cash Flows Key Data (For the 6 months ended June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Net cash from operating activities | 21,987 | 2,142 | | Net cash used in investing activities | (30,823) | (2,497) | | Net cash used in financing activities | (97) | (88) | | Net decrease in cash and cash equivalents | (8,933) | (443) | | Cash and cash equivalents at end of period | 30,721 | 21,831 | - Net cash from operating activities significantly increased from **AUD 2,142 thousand** in the prior period of 2024 to **AUD 21,987 thousand** in 2025[18](index=18&type=chunk) - Net cash used in investing activities substantially increased from **AUD 2,497 thousand** in the prior period of 2024 to **AUD 30,823 thousand** in 2025, primarily due to the **payment of AUD 29,904 thousand for reclamation guarantees**[18](index=18&type=chunk) Notes to the Consolidated Interim Financial Statements [Corporate Information and Summary of Material Accounting Information](index=10&type=section&id=Corporate%20Information%20and%20Summary%20of%20Material%20Accounting%20Information) This section outlines the company's reporting entity information, basis of financial statement preparation, and accounting policies, confirming its primary engagement in gold mining and exploration, and no significant impact from new accounting standards - Dragon Mining Limited was incorporated on April 23, 1990, as an Australian public company, primarily engaged in **gold mining operations** and **gold mineral exploration**[19](index=19&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - The consolidated interim financial statements are prepared in accordance with the Hong Kong Companies Ordinance, the Listing Rules, and International Accounting Standard 34, and are presented in **Australian Dollars**[24](index=24&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) - The Board has determined that the new and revised accounting standards and interpretations have **no material impact** on the company, and no significant changes to accounting policies are required[32](index=32&type=chunk)[34](index=34&type=chunk) [Other Revenue, Income and Expenses](index=13&type=section&id=Other%20Revenue,%20Income%20and%20Expenses) This section details the company's revenue from customers, cost of sales, other gains, other income, and operating expenses for the six months ended June 30, 2025, showing significant growth in gold sales and toll treatment service revenue Other Revenue, Income and Expenses (For the 6 months ended June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | **Revenue from customers** | | | | Revenue from gold sales | 50,105 | 30,678 | | Revenue from toll treatment services | 4,355 | – | | **Cost of sales** | | | | Production costs (net of inventory movements) | 22,780 | 23,629 | | Depreciation of mine property, plant and equipment | 5,059 | 3,171 | | **Other gains** | | | | Financing income and interest | 724 | 330 | | **Other income** | | | | Net gain on cancellation of crusher agreement | – | 1,550 | | Service income | 405 | 447 | | **Operating expenses** | | | | Management and administrative expenses | 4,009 | 2,621 | | Reclamation costs | 465 | 488 | | **Finance costs** | | | | Unwinding of discount on reclamation provision | 504 | 572 | | Interest expense | 106 | 5 | | **Total employee benefits** | | | | Wages and salaries | 4,127 | 3,976 | - Revenue from gold sales increased by **63.3%**, from **AUD 30,678 thousand** in 2024 to **AUD 50,105 thousand** in 2025[36](index=36&type=chunk) - New revenue from toll treatment services of **AUD 4,355 thousand** in 2025 significantly contributed to total revenue[36](index=36&type=chunk) [Income Tax](index=15&type=section&id=Income%20Tax) This section explains the company's income tax policy and expenses for the period ended June 30, 2025, indicating full utilization of tax losses in Finland and increased income tax expense and liabilities Income Tax Expense (For the 6 months ended June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Current income tax expense | 5,352 | 978 | - The company recognized an income tax expense of **AUD 5,352 thousand** (2024: AUD 978 thousand) and a tax liability of **AUD 4,467 thousand** (2024: AUD 968 thousand)[42](index=42&type=chunk)[43](index=43&type=chunk) - The Group has **fully utilized its tax losses in Finland**, and no provision has been made for Hong Kong profits tax during the period[41](index=41&type=chunk)[43](index=43&type=chunk) [Trade and Other Receivables](index=16&type=section&id=Trade%20and%20Other%20Receivables) As of June 30, 2025, the company's total trade and other receivables increased, primarily due to a significant rise in trade receivables, with all amounts subsequently recovered after the period end Trade and Other Receivables (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Trade receivables – amortized cost | 3,019 | 657 | | Other receivables | 1,240 | 1,913 | | **Total** | **4,259** | **2,570** | - Trade receivables increased by **359.5%**, from **AUD 657 thousand** as of December 31, 2024, to **AUD 3,019 thousand** as of June 30, 2025[47](index=47&type=chunk) - All trade receivables are due within one month, with no significant probability of default, and all amounts were subsequently collected after the period end[47](index=47&type=chunk)[49](index=49&type=chunk) [Inventories](index=17&type=section&id=Inventories) As of June 30, 2025, the company's total inventories increased to AUD 25.557 million, mainly due to higher ore and concentrate stockpiles and gold in circuit values Inventories (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Ore and concentrate stockpiles – at cost | 17,253 | 12,470 | | Gold in circuit – at cost | 6,708 | 4,236 | | Gold on hand – at cost | – | 1,492 | | Raw materials and stores – at cost | 1,596 | 1,059 | | **Total** | **25,557** | **19,257** | - Ore and concentrate stockpiles increased by **38.4%**, from **AUD 12,470 thousand** as of December 31, 2024, to **AUD 17,253 thousand** as of June 30, 2025[51](index=51&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=18&type=section&id=Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, the company recorded a fair value loss on financial assets, primarily shares in Aurion Resources Limited, but overall investment value increased Financial Assets at Fair Value Through Profit or Loss (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Investments at fair value through profit or loss | 2,053 | 1,826 | - The company holds **2,452,910 shares** in Aurion Resources Limited, representing **1.89%** of its issued ordinary shares[54](index=54&type=chunk) - The fair value change of these shares during the period was a **loss of AUD 0.05 million** (June 30, 2024: gain of AUD 0.31 million)[54](index=54&type=chunk) [Other Assets](index=19&type=section&id=Other%20Assets) As of June 30, 2025, the company's non-current other assets significantly increased, mainly due to additional environmental guarantees placed for Finnish and Swedish mines Other Assets (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Current prepayments | 962 | 398 | | Current other receivables | 907 | 468 | | Non-current environmental and other guarantees | 40,580 | 12,587 | - Non-current environmental and other guarantees increased by **222.4%**, from **AUD 12,587 thousand** as of December 31, 2024, to **AUD 40,580 thousand** as of June 30, 2025[57](index=57&type=chunk) - The company placed an **additional collateral guarantee of SEK 5.2 million** (approximately AUD 10.5 million total) for Svartliden in Sweden and a **new environmental guarantee of EUR 20.6 million** for Vammala in Finland[58](index=58&type=chunk)[59](index=59&type=chunk) [Property, Plant and Equipment](index=20&type=section&id=Property,%20Plant%20and%20Equipment) As of June 30, 2025, the net book value of the company's property, plant, and equipment increased to AUD 57.569 million, primarily due to an increase in mine properties, with no impairment triggers identified during the period Net Book Value of Property, Plant and Equipment (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Land | 1,490 | 1,379 | | Buildings | 294 | 116 | | Property, plant and equipment | 5,447 | 4,520 | | Mine properties | 50,338 | 47,291 | | **Total** | **57,569** | **53,306** | - Mine properties net value increased by **6.4%**, from **AUD 47,291 thousand** as of December 31, 2024, to **AUD 50,338 thousand** as of June 30, 2025[61](index=61&type=chunk) - No impairment triggers were identified, and no impairment was recognized during the period, with capitalized costs for Fäboliden mine property totaling **AUD 20.8 million**[62](index=62&type=chunk) [Mineral Exploration and Evaluation Costs](index=21&type=section&id=Mineral%20Exploration%20and%20Evaluation%20Costs) As of June 30, 2025, total mineral exploration and evaluation costs increased to AUD 2.603 million, mainly due to new additions and foreign exchange movements, with some costs reclassified to mine properties Mineral Exploration and Evaluation Costs (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Balance at beginning of period | 1,436 | 1,848 | | Additions | 1,565 | 3,103 | | Reclassified to mine properties | (587) | (3,547) | | Net foreign exchange movement | 189 | 32 | | **Total** | **2,603** | **1,436** | - Additions of **AUD 1,565 thousand** were made during the period, while **AUD 587 thousand** was reclassified to mine properties[63](index=63&type=chunk) - The recoverability of exploration and evaluation costs depends on the successful development and commercial exploitation or alternative recovery through the sale of interest areas[64](index=64&type=chunk) [Trade and Other Payables](index=21&type=section&id=Trade%20and%20Other%20Payables) As of June 30, 2025, the company's total trade and other payables increased to AUD 14.395 million, with all amounts due within one month Trade and Other Payables (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Trade payables and accrued expenses | 14,395 | 8,318 | | **Total** | **14,395** | **8,318** | - Trade payables and accrued expenses increased by **73.1%**, from **AUD 8,318 thousand** as of December 31, 2024, to **AUD 14,395 thousand** as of June 30, 2025[66](index=66&type=chunk) - All trade payables and accrued expenses are **due within one month**[66](index=66&type=chunk) [Provisions](index=22&type=section&id=Provisions) As of June 30, 2025, non-current provisions significantly increased, mainly due to a net increase in reclamation provisions and foreign exchange movements, reflecting ongoing commitments for Finnish and Swedish mine reclamation obligations Provisions (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Current employee entitlements | 1,600 | 1,810 | | Current reclamation | 1,948 | 1,814 | | Non-current employee entitlements | 37 | 28 | | Non-current reclamation | 40,088 | 34,229 | | **Total** | **43,673** | **37,881** | - Reclamation provisions saw a **net increase of AUD 2,184 thousand** and a **net foreign exchange movement increase of AUD 2,840 thousand**, bringing the total reclamation provision to **AUD 42,036 thousand**[68](index=68&type=chunk) - The company provided an **additional SEK 32.0 million** (approximately AUD 5.2 million) in collateral for Svartliden in Sweden, bringing the total to **SEK 65.0 million** (approximately AUD 10.5 million)[71](index=71&type=chunk)[75](index=75&type=chunk) - A **new environmental guarantee of EUR 11.9 million** (approximately AUD 20.6 million) was placed for Vammala in Finland, with an existing EUR 1.4 million guarantee returned in June 2025[72](index=72&type=chunk)[76](index=76&type=chunk) [Contributed Equity](index=24&type=section&id=Contributed%20Equity) As of June 30, 2025, the company's contributed equity remained unchanged at AUD 140.408 million, with 158,096,613 ordinary shares issued Contributed Equity (As of June 30) | Indicator | 2025 (AUD thousand) | December 31, 2024 (AUD thousand) | | :--- | :--- | :--- | | Fully paid ordinary shares | 140,408 | 140,408 | - The number of issued shares remained **unchanged at 158,096,613** during the period[79](index=79&type=chunk) - The company entered into a placement agreement on September 8, 2025, to place up to **31,619,322 placement shares** at **HKD 5.61 per share**, with estimated net proceeds of approximately **HKD 172.8 million**[79](index=79&type=chunk)[81](index=81&type=chunk)[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) [Dividends](index=24&type=section&id=Dividends) For the period ended June 30, 2025, no dividends were paid or declared, and the board did not recommend any dividend payments - No dividends have been paid or declared since the beginning of the period, and the directors do not recommend paying any dividends for the period ended June 30, 2025[80](index=80&type=chunk)[82](index=82&type=chunk) [Earnings Per Share](index=25&type=section&id=Earnings%20Per%20Share) For the six months ended June 30, 2025, the company's basic and diluted earnings per share significantly increased, reflecting improved profitability Earnings Per Share (As of June 30) | Indicator | 2025 (AUD) | 2024 (AUD) | | :--- | :--- | :--- | | Profit after tax for basic and diluted EPS (AUD thousand) | 12,692 | 1,971 | | Weighted average number of ordinary shares for basic and diluted EPS | 158,096,613 | 158,096,613 | | Basic and diluted earnings per share (AUD cents) | 8.03 | 1.25 | - Basic and diluted earnings per share increased by **542.4%**, from **AUD 1.25 cents** in the prior period of 2024 to **AUD 8.03 cents** in 2025[87](index=87&type=chunk) - Earnings per share is calculated based on the net profit attributable to ordinary shareholders of the parent company divided by the weighted average number of ordinary shares outstanding during the period[83](index=83&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk) [Related Party Transactions](index=26&type=section&id=Related%20Party%20Transactions) This section discloses transactions between the company, its subsidiaries, and other related parties, including administrative and management service agreements, loan facilities, and shareholdings of entities with significant influence over the Group - The company received **AUD 55,500** for Chief Financial Officer services and **AUD 63,598** for administrative services from Tanami Gold NL[92](index=92&type=chunk) - The company received **AUD 86,233** for Chief Financial Officer services and **AUD 210,549** for administrative services from Metals X Limited[92](index=92&type=chunk) - The company entered into an administrative and management service sharing agreement with Allied Group, receiving **AUD 18,095** in service fees during the period[95](index=95&type=chunk)[96](index=96&type=chunk) - The company has an **unsecured loan facility of AUD 27.0 million** with AP Finance Limited, a wholly-owned subsidiary of Allied Group[95](index=95&type=chunk)[96](index=96&type=chunk) - Allied Properties Resources Limited (APRL) holds **29.65%** of the company's ordinary shares, and Sincere View International Limited holds **13.74%** of the company's ordinary shares[95](index=95&type=chunk)[96](index=96&type=chunk) [Segment Information](index=29&type=section&id=Segment%20Information) This section segments the company's operations by geographical location (Sweden and Finland), providing revenue, profit/loss, asset, and liability information for each segment, highlighting Finland's significant contribution to Group profitability - The Group's operating segments are divided into Sweden and Finland, primarily based on geographical location, different national regulatory environments, and different end products[97](index=97&type=chunk)[101](index=101&type=chunk) Segment Revenue and Profit or Loss (For the 6 months ended June 30) | Indicator | Sweden (AUD thousand) | Finland (AUD thousand) | Unallocated (AUD thousand) | Total (AUD thousand) | | :--- | :--- | :--- | :--- | :--- | | Gold sales to external customers | 50,105 | – | – | 50,105 | | Inter-segment sales | – | 52,508 | – | 52,508 | | Elimination of inter-segment revenue | (52,508) | – | – | (52,508) | | Toll treatment revenue | 4,355 | – | – | 4,355 | | Total revenue from customers | 1,952 | 52,508 | – | 54,460 | | Segment (loss)/profit before tax | (6,330) | 24,643 | (269) | 18,044 | | Segment (loss)/profit after tax | (6,330) | 19,291 | (269) | 12,692 | Segment Assets and Liabilities (As of June 30) | Indicator | Sweden (AUD thousand) | Finland (AUD thousand) | Australia (AUD thousand) | Total (AUD thousand) | | :--- | :--- | :--- | :--- | :--- | | Total assets | 65,722 | 73,362 | 26,543 | 165,627 | | Total liabilities | 30,566 | 31,057 | 1,438 | 63,061 | [Expenditure Commitments](index=32&type=section&id=Expenditure%20Commitments) This section discloses the company's exploration and remuneration commitments as of June 30, 2025, detailing estimated expenditures for the upcoming year and the next one to five years Exploration Commitments (As of June 30) | Period | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Within one year | 53 | 86 | | One year or later and not later than five years | 291 | 241 | | **Total** | **344** | **327** | Remuneration Commitments (As of June 30) | Period | 2025 (AUD thousand) | 2024 (AUD thousand) | | :--- | :--- | :--- | | Within one year | 684 | 667 | | One year or later and not later than five years | 3,420 | 2,667 | | **Total** | **4,104** | **3,334** | - Exploration commitments can be reduced by selectively relinquishing exploration tenements or renegotiating expenditure commitments[115](index=115&type=chunk) [Significant Events After Period End](index=34&type=section&id=Significant%20Events%20After%20Period%20End) This section discloses significant events occurring after the reporting period end, including the lapse of conditional voluntary cash offers and the company entering into a placement agreement to raise funds - APRL made a conditional voluntary cash offer on April 1, 2025, which was subsequently **withdrawn on June 2, 2025**[120](index=120&type=chunk)[123](index=123&type=chunk) - Wah Cheong made a voluntary cash offer of **HKD 2.60 per share** on May 19, 2025, which the Independent Board Committee recommended shareholders reject, and the offer **lapsed on August 8, 2025**[121](index=121&type=chunk)[122](index=122&type=chunk)[124](index=124&type=chunk) - The company entered into a placement agreement on September 8, 2025, to place up to **31,619,322 placement shares** at **HKD 5.61 per share**, with estimated net proceeds of approximately **HKD 172.8 million**[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) Independent Auditor's Review Report [Auditor's Conclusion](index=36&type=section&id=Auditor's%20Conclusion) Ernst & Young reviewed the consolidated interim financial information for the six months ended June 30, 2025, concluding no material matters indicating non-compliance with IAS 34 - Independent auditor Ernst & Young reviewed the company's interim financial information for the six months ended June 30, 2025[129](index=129&type=chunk) - The review was conducted in accordance with International Standard on Review Engagements 2410, with a scope smaller than an audit, thus **no audit opinion was expressed**[132](index=132&type=chunk)[134](index=134&type=chunk) - The auditors are not aware of any matters that lead them to believe the interim financial information is not prepared, in all material respects, in accordance with International Accounting Standard 34[133](index=133&type=chunk)[135](index=135&type=chunk) Directors' Interests [Directors' Shareholdings](index=38&type=section&id=Directors'%20Shareholdings) As of June 30, 2025, Mr. Arthur George Dew held 220,000 shares, representing 0.14% of total issued shares, with all interests being long positions Directors' Shareholdings (As of June 30) | Director Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | | Mr. Arthur George Dew | Beneficial owner/Personal interest | 220,000 | 0.14% | - Save as disclosed, no other directors or chief executives had any interests or short positions in the shares, underlying shares, or debentures of the company or any of its associated corporations[139](index=139&type=chunk)[140](index=140&type=chunk) Substantial Shareholders' Interests [Major Shareholder Holdings](index=39&type=section&id=Major%20Shareholder%20Holdings) As of June 30, 2025, APAC Resources Limited, Allied Group Limited, and Lee and Lee Trust each held 29.65% of the company's shares through controlled corporations, while Sincere View International Limited held 13.74% Major Shareholder Holdings (As of June 30) | Shareholder Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | | APAC Resources Limited | Interest in controlled corporation | 46,877,727 | 29.65% | | Allied Group Limited | Interest in controlled corporation | 46,877,727 | 29.65% | | Lee and Lee Trust | Interest in controlled corporation | 46,877,727 | 29.65% | | Sincere View International Limited | Beneficial owner | 21,716,899 | 13.74% | | Mr. Hon Kwok Lung | Interest in controlled corporation | 21,716,899 | 13.74% | | Ms. Lam Suk Ying | Spouse's interest | 21,716,899 | 13.74% | - APAC Resources Limited, Allied Group Limited, and Lee and Lee Trust each indirectly held **29.65%** of the company's shares through Allied Properties Resources Limited[145](index=145&type=chunk) - Mr. Hon Kwok Lung controls **80%** of Sincere View International Limited, and Ms. Lam Suk Ying is Mr. Hon Kwok Lung's spouse, thus both are deemed to have a **13.74% interest**[146](index=146&type=chunk)[148](index=148&type=chunk)[149](index=149&type=chunk) Corporate Governance and Other Information [Corporate Governance Compliance](index=41&type=section&id=Corporate%20Governance%20Compliance) The company is committed to good corporate governance, complying with all code provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules for the six months ended June 30, 2025 - The company has complied with **all code provisions** of the Corporate Governance Code as set out in Appendix C1 of the Listing Rules[152](index=152&type=chunk)[156](index=156&type=chunk) - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers in Appendix C3 of the Listing Rules as its code of conduct for directors' securities transactions, and all directors have confirmed compliance[153](index=153&type=chunk)[157](index=157&type=chunk) [Changes in Directors' Information](index=41&type=section&id=Changes%20in%20Directors'%20Information) This section discloses changes in directors' information during the period, including other appointments for CEO and Executive Director Mr. Brett Robert Smith and Non-Executive Director Ms. Lam Lai - CEO and Executive Director Mr. Brett Robert Smith was appointed as **Non-Executive Chairman of Mount Gibson Iron Limited** and **Non-Executive Director of Elementos Limited**[159](index=159&type=chunk) - Non-Executive Director Ms. Lam Lai resigned as **Executive Director and Authorized Representative of Ernest Borel Holdings Limited**[159](index=159&type=chunk) [Audit and Risk Management Committee Review](index=42&type=section&id=Audit%20and%20Risk%20Management%20Committee%20Review) The Audit and Risk Management Committee reviewed the company's consolidated interim results for the six months ended June 30, 2025, which were also reviewed by Ernst & Young - The Audit and Risk Management Committee, comprising three independent non-executive directors, reviewed the company's consolidated interim results for the six months ended June 30, 2025[160](index=160&type=chunk)[164](index=164&type=chunk) - The company's auditor, Ernst & Young, conducted a review of the interim financial information in accordance with International Standard on Review Engagements 2410[160](index=160&type=chunk)[164](index=164&type=chunk) [Other Corporate Information](index=42&type=section&id=Other%20Corporate%20Information) This section clarifies the rounding of amounts in the report and confirms no interim dividends were paid or declared, nor were any company shares repurchased, sold, or redeemed during the period - Amounts presented in this report and the interim financial report have been **rounded to the nearest AUD 1,000**[161](index=161&type=chunk)[165](index=165&type=chunk) - No dividends were paid or declared during the period, and the directors have not recommended or declared any dividends[162](index=162&type=chunk)[166](index=166&type=chunk) - Neither the company nor any of its subsidiaries repurchased, sold, or redeemed any of the company's shares during the six months ended June 30, 2025[163](index=163&type=chunk)[167](index=167&type=chunk) Management Discussion and Analysis [Business Review](index=43&type=section&id=Business%20Review) This section reviews the Group's operational nature, key activities, health and safety performance, mine operations in Finland and Sweden, ESG commitments, and operational risks - The Group primarily operates **gold mines and processing facilities in Finland and Sweden**, including the Vammala Production Centre in Finland and the Svartliden Production Centre in Sweden[169](index=169&type=chunk)[170](index=170&type=chunk)[172](index=172&type=chunk)[173](index=173&type=chunk) - Safety is one of the Group's top priorities, with **no lost-time injuries (LTIs)** occurring during the period, and both Finnish and Swedish mines maintaining long periods without LTIs[176](index=176&type=chunk)[181](index=181&type=chunk)[182](index=182&type=chunk) - The Group faces operational risks including **production delays, difficulties in obtaining permits, socio-political protests, cyberattacks, and natural disasters**[232](index=232&type=chunk)[234](index=234&type=chunk)[239](index=239&type=chunk)[240](index=240&type=chunk)[245](index=245&type=chunk)[246](index=246&type=chunk) [Nature of Operations and Principal Activities](index=43&type=section&id=Nature%20of%20Operations%20and%20Principal%20Activities) Dragon Mining Limited, an Australian company listed on the HKEX, primarily operates gold mines and processing facilities in Finland and Sweden, and conducts gold exploration, evaluation, and development in the Nordic region - The Group operates **gold mines and processing facilities in Finland and Sweden**, with an annual production of **20,000 to 30,000 ounces of gold concentrate**[169](index=169&type=chunk)[172](index=172&type=chunk) - Principal activities include **gold mining and ore processing in Finland**, **ore and gold concentrate processing in Sweden**, and **exploration, evaluation, and development of gold projects in the Nordic region**[175](index=175&type=chunk) [Health and Safety](index=44&type=section&id=Health%20and%20Safety) Safety is the Group's top priority, maintained through leadership, safety procedures, and regular inspections, with no lost-time injuries reported during the period in Finland and Sweden - The Group is committed to safeguarding the health and welfare of its employees and contractors, exceeding the expected standards of local health and safety regulations[176](index=176&type=chunk) - During the period, **no lost-time injuries (LTIs)** occurred in any of the Group's operations[181](index=181&type=chunk)[182](index=182&type=chunk) Lost Time Injury Frequency (As of June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Lost Time Injury Frequency | 10.6 | 10.6 | [Operations Overview](index=45&type=section&id=Operations%20Overview) This section details production at Finnish and Swedish mines, showing significant gold production increase at Finland's Vammala plant and reduced operating costs at Sweden's Svartliden plant through toll treatment services - The Finland Vammala plant processed **157,047 tonnes of ore** with an average grade of **3.06 grams/tonne**, producing **13,475 ounces of gold** and achieving a processing recovery rate of **87.2%**[184](index=184&type=chunk)[186](index=186&type=chunk)[187](index=187&type=chunk) - The Sweden Svartliden plant produced **11,266 ounces of gold** from Vammala flotation concentrate and processed **29,530 tonnes of gold-bearing ore** from Botnia on a toll treatment basis, yielding **433 ounces of gold**[204](index=204&type=chunk)[205](index=205&type=chunk)[207](index=207&type=chunk)[208](index=208&type=chunk) - The toll treatment of gold-bearing ore from Botnia made a **positive contribution to reducing the operating costs** of the Svartliden plant[206](index=206&type=chunk)[207](index=207&type=chunk) [Environment, Social and Governance](index=50&type=section&id=Environment,%20Social%20and%20Governance) The Group maintains a robust corporate governance system, committed to socially responsible operations, balancing stakeholder interests, and promoting sustainable mineral resource development through efficient, balanced, and forward-looking management - The Board is overall responsible for the Group's **Environmental, Social, and Governance (ESG) management**, committed to the **sustainable development of mineral resources**[221](index=221&type=chunk)[223](index=223&type=chunk) - The Group is committed to operating within the framework of the law, monitoring and minimizing environmental impact, and fully considering environmental matters at all stages of mining projects[222](index=222&type=chunk)[224](index=224&type=chunk) - Dragon Mining emphasizes the **Towards Sustainable Mining (TSM) initiative in Finland** and has published a social responsibility report and a 2024 ESG report[226](index=226&type=chunk)[227](index=227&type=chunk)[230](index=230&type=chunk)[231](index=231&type=chunk) [Operational Risks](index=51&type=section&id=Operational%20Risks) The Group faces ongoing operational risks including safety incidents, production delays, permitting difficulties, socio-political protests, cyberattacks, and natural disasters, which could adversely affect business - Lost-time injuries, serious workplace accidents, or major equipment failures could lead to **personal injury, production stoppages, or closures**, significantly impacting the business[233](index=233&type=chunk) - The application for an environmental permit for full-scale mining at Fäboliden was **rejected by the Swedish Supreme Court**, and the company plans to resubmit the application, with any delays potentially affecting profitability[234](index=234&type=chunk)[242](index=242&type=chunk)[243](index=243&type=chunk)[244](index=244&type=chunk)[247](index=247&type=chunk) - The Group may face protests from activist groups or individuals opposing mining, leading to **delays or increased costs**, and potentially adversely affecting the political landscape[245](index=245&type=chunk)[248](index=248&type=chunk) [Financial Review](index=54&type=section&id=Financial%20Review) This section analyzes the company's financial performance for the six months ended June 30, 2025, covering profitability, revenue, costs, working capital, liquidity, gearing ratio, financial risks, and future strategy - For the period ended June 30, 2025, the Group recorded a **profit before tax of AUD 18.0 million** (2024: AUD 2.9 million) and a **profit after tax of AUD 12.7 million** (2024: AUD 2.0 million)[249](index=249&type=chunk)[251](index=251&type=chunk) - The increase in profit is primarily attributable to **improved gold grade and recovery, higher average gold prices, and positive contributions from toll treatment of gold-bearing ore**[254](index=254&type=chunk) - The company has **net assets of AUD 102.6 million**, a **working capital surplus of AUD 41.7 million**, and a **gearing ratio of 0.4%**[269](index=269&type=chunk)[273](index=273&type=chunk) [Profitability](index=54&type=section&id=Profitability) For the six months ended June 30, 2025, the company's profit before tax and profit after tax both significantly increased, driven by improved gold grade and recovery, higher average gold prices, and positive contributions from toll treatment services - Profit before tax increased from **AUD 2.9 million** in the prior period of 2024 to **AUD 18.0 million** in 2025[249](index=249&type=chunk)[251](index=251&type=chunk) - Profit after tax increased from **AUD 2.0 million** in the prior period of 2024 to **AUD 12.7 million** in 2025[249](index=249&type=chunk)[251](index=251&type=chunk) [Revenue from Customers](index=54&type=section&id=Revenue%20from%20Customers) Revenue from customers significantly increased, primarily from gold sales and new toll treatment services, with both gold sales volume and average gold prices rising - Gold sales revenue increased by **63.3% to AUD 50.1 million**, with total gold sold at **10,370 ounces** (2024: 9,025 ounces) and an average gold price of **USD 3,123 per ounce** (2024: USD 2,208 per ounce)[249](index=249&type=chunk)[252](index=252&type=chunk) - Revenue from toll treatment services amounted to **AUD 4.4 million**, derived from processing **29,530 tonnes of gold-bearing ore** from Botnia[250](index=250&type=chunk)[253](index=253&type=chunk) [Cost of Sales](index=55&type=section&id=Cost%20of%20Sales) Cost of sales slightly increased, primarily including mining costs, processing costs, other production costs, and mine property depreciation. Finnish mining costs decreased, while Svartliden processing costs increased due to toll treatment services Cost of Sales Overview (As of June 30) | Indicator | 2025 (AUD thousand) | 2024 (AUD thousand) | Change Percentage | | :--- | :--- | :--- | :--- | | Mining costs | 14,120 | 12,877 | 9.7% | | Processing costs | 12,383 | 9,486 | 30.5% | | Other production costs | 399 | 350 | 14.0% | | Gold inventory movements | (4,122) | 916 | – | | Depreciation of mine property, plant and equipment | 5,059 | 3,171 | 59.5% | | **Total Cost of Sales** | **27,839** | **26,800** | **3.9%** | - Finnish operations' mining costs averaged **AUD 69 per tonne of ore**, a **17.2% decrease** year-on-year[262](index=262&type=chunk)[264](index=264&type=chunk) - Svartliden processing costs increased by **43.8% to AUD 2,144 per tonne of concentrate**, primarily due to toll treatment services[260](index=260&type=chunk)[261](index=261&type=chunk) [Gross Profit](index=57&type=section&id=Gross%20Profit) A substantial 77.5% increase in revenue from customers, coupled with only a 3.9% rise in cost of sales, led to a significant 586.5% increase in gross profit to AUD 26.6 million, achieving a gross margin of 48.9% - Revenue from customers increased by **77.5%**, cost of sales slightly increased by **3.9%**, and gross profit increased by **586.5% to AUD 26.6 million**[266](index=266&type=chunk)[270](index=270&type=chunk) - Gross margin improved from **12.6%** in the prior period of 2024 to **48.9%** in 2025[266](index=266&type=chunk)[270](index=270&type=chunk) [Investment in Aurion Resources Limited](index=57&type=section&id=Investment%20in%20Aurion%20Resources%20Limited) The company continues to hold 2,452,910 shares in Aurion Resources Limited, with no shares sold during the period - The company holds **2,452,910 shares** in Aurion Resources Limited, a Canadian exploration company listed on the TSX Venture Exchange[267](index=267&type=chunk)[271](index=271&type=chunk) - No Aurion shares were sold as of the date of this interim report[267](index=267&type=chunk)[271](index=271&type=chunk) [Management and Administration and Other Expenses](index=57&type=section&id=Management%20and%20Administration%20and%20Other%20Expenses) Management and administration expenses include corporate costs, changes in reclamation provisions for non-productive assets, and depreciation of non-mining assets, while other expenses cover written-off evaluation asset costs and corporate-related costs - Management and administrative expenses include **corporate costs**, **changes in reclamation provisions for non-productive assets**, and **depreciation of non-mining assets**[268](index=268&type=chunk)[272](index=272&type=chunk) - Other expenses include the **cost of evaluation assets written off** as part of the Group's regular review of capitalized exploration and evaluation costs, and **corporate-related costs**[268](index=268&type=chunk)[272](index=272&type=chunk) [Working Capital, Liquidity and Gearing Ratio](index=57&type=section&id=Working%20Capital,%20Liquidity%20and%20Gearing%20Ratio) As of June 30, 2025, the company's net assets and working capital surplus both increased, with sufficient cash and cash equivalents and a low gearing ratio - Net assets were **AUD 102.6 million** (2024: AUD 69.4 million), and working capital surplus was **AUD 41.7 million** (2024: AUD 38.3 million)[269](index=269&type=chunk)[273](index=273&type=chunk) - Market capitalization at period end was **AUD 106.7 million** or **HKD 548.6 million**[269](index=269&type=chunk)[273](index=273&type=chunk) - Cash and cash equivalents were **AUD 30.7 million** (2024: AUD 21.8 million), and the gearing ratio was **0.4%** (2024: 0.3%)[269](index=269&type=chunk)[273](index=273&type=chunk) [Interest Bearing Liabilities](index=58&type=section&id=Interest%20Bearing%20Liabilities) The company has an unsecured loan facility of AUD 27.0 million with AP Finance Limited, maturing on December 31, 2026, with no amounts drawn during the period - The company has an **unsecured loan facility of AUD 27.0 million** with AP Finance Limited, maturing on **December 31, 2026**[274](index=274&type=chunk)[279](index=279&type=chunk) - The terms and conditions of the loan facility remain unchanged, and the company has **not drawn any amounts** as of the date of this interim report[274](index=274&type=chunk)[279](index=279&type=chunk) [Conditional Voluntary Cash Offer](index=58&type=section&id=Conditional%20Voluntary%20Cash%20Offer) APRL and Wah Cheong successively made conditional voluntary cash offers, but the Independent Board Committee recommended shareholders reject them, and the offers ultimately lapsed due to unfulfilled acceptance conditions - APRL made a conditional voluntary cash offer on April 1, 2025, which was subsequently **withdrawn on June 2, 2025**[275](index=275&type=chunk)[277](index=277&type=chunk)[280](index=280&type=chunk) - Wah Cheong made a voluntary cash offer of **HKD 2.60 per share** on May 19, 2025, which the Independent Board Committee recommended shareholders reject, and the offer **lapsed on August 8, 2025**[276](index=276&type=chunk)[277](index=277&type=chunk)[278](index=278&type=chunk)[280](index=280&type=chunk)[281](index=281&type=chunk) [Use of Net Proceeds from the Company's Placement](index=59&type=section&id=Use%20of%20Net%20Proceeds%20from%20the%20Company's%20Placement) The company fully utilized the net proceeds from the January 2021 share placement to settle environmental guarantee obligations related to its Finnish and Swedish operations - The net proceeds from the January 2021 share placement amounted to **HKD 39.6 million** (approximately AUD 7.6 million)[283](index=283&type=chunk)[284](index=284&type=chunk) - During the period, the Group utilized the remaining net proceeds of **HKD 2.6 million** (approximately AUD 0.5 million) to partially settle environmental guarantees for Vammala and Svartliden[283](index=283&type=chunk)[284](index=284&type=chunk) - The net proceeds have been **fully allocated** to settle certain environmental guarantees related to the company's operations in Finland and Sweden[283](index=283&type=chunk)[284](index=284&type=chunk) [Financial Risks](index=60&type=section&id=Financial%20Risks) The company faces various financial risks including foreign exchange, commodity price, liquidity, credit, and interest rate risks, and implements corresponding measures for management and hedging - The company sells gold and silver doré and gold concentrate in **USD**, incurs most costs in **SEK and EUR**, and presents its financial statements in **AUD**, exposing it to foreign exchange risk[287](index=287&type=chunk)[293](index=293&type=chunk) - The company is exposed to the risk of **fluctuations in gold prices**, with no current plans to hedge commodity price risk[289](index=289&type=chunk)[295](index=295&type=chunk) - Credit risk primarily arises from bank deposits, trade and other receivables, and environmental and other guarantees, with a **concentration of credit risk from sales of gold concentrate to a Finnish smelter**[292](index=292&type=chunk)[297](index=297&type=chunk) [Company Strategy and Future Developments](index=61&type=section&id=Company%20Strategy%20and%20Future%20Developments) The company focuses on gold exploration, mining, and processing in the Nordic region, aiming to develop existing and new mining assets, and plans to resubmit the environmental permit application for full-scale mining at Fäboliden - The company's objective is to focus on developing **existing and new mining assets** within a reasonable distance of its Vammala and Svartliden processing plants in Finland and Sweden[302](index=302&type=chunk)[307](index=307&type=chunk) - Following the Swedish Supreme Court's rejection of the environmental permit appeal for full-scale mining at Fäboliden, the company plans to **resubmit a revised application** to address the environmental court's concerns[308](index=308&type=chunk)[312](index=312&type=chunk) - The net proceeds from the placement are intended for the **acquisition of a mining contractor business**, **settlement of environmental bonds**, **upgrading processing plant facilities and equipment**, and **mining development costs at Svartliden**[326](index=326&type=chunk)[327](index=327&type=chunk) [Dividends](index=62&type=section&id=Dividends) For the period ended June 30, 2025, no dividends were paid or declared, and the board did not recommend any dividend payments - No dividends have been paid or declared since the beginning of the period, and the directors do not recommend paying any dividends for the period ended June 30, 2025[314](index=314&type=chunk) [Significant Investments Held, Material Acquisitions and Disposal of Subsidiaries, Associates or Joint Ventures and Future Plans for Material Investments or Capital Assets](index=62&type=section&id=Significant%20Investments%20Held,%20Material%20Acquisitions%20and%20Disposal%20of%20Subsidiaries,%20Associates%20or%20Joint%20Ventures%20and%20Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) Aside from disclosures in the interim report, there were no other significant investments, material acquisitions or disposals of subsidiaries, associates, or joint ventures, nor any other plans for material investments or capital asset additions approved by the board during the period - Other than as disclosed in this interim report, there were **no other significant investments held**, nor any **material acquisitions or disposals of subsidiaries, associates, or joint ventures** during the period[311](index=311&type=chunk)[314](index=314&type=chunk) - Other than as disclosed in this interim report, the Board had **not approved any plans for other material investments or additions to capital assets** as of the date of this interim report[311](index=311&type=chunk)[314](index=314&type=chunk) [Purchase, Sale, or Redemption of the Company's Listed Securities](index=63&type=section&id=Purchase,%20Sale,%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During the period, the company did not repurchase any listed securities, despite shareholders authorizing the repurchase of up to 10% of issued shares - During the period, the company **did not repurchase any of its listed securities** under the repurchase mandate granted by shareholders at the Annual General Meeting held on May 22, 2025[315](index=315&type=chunk)[321](index=321&type=chunk) - The company was authorized to repurchase up to **15,809,661 shares**, representing **10%** of the total issued shares as of the date of the Annual General Meeting[313](index=313&type=chunk) [Significant Events After Period End](index=63&type=section&id=Significant%20Events%20After%20Period%20End) This section reiterates significant events after the reporting period, including the lapse of a conditional voluntary cash offer and the company entering into a placement agreement to raise funds, detailing the placement terms and use of proceeds - Wah Cheong's voluntary cash offer **lapsed on August 8, 2025**, as the acceptance conditions were not fulfilled[319](index=319&type=chunk)[323](index=323&type=chunk) - The company entered into a placement agreement on September 8, 2025, to place up to **31,619,322 placement shares** at **HKD 5.61 per share**, with estimated net proceeds of approximately **HKD 172.8 million**[320](index=320&type=chunk)[323](index=323&type=chunk)[326](index=326&type=chunk)[327](index=327&type=chunk) - The net proceeds from the placement will be used for the **acquisition of a mining contractor business**, **settlement of environmental bonds**, **upgrading processing plant facilities and equipment**, and **mining development costs at Svartliden**[326](index=326&type=chunk)[327](index=327&type=chunk) Advanced Projects and Exploration Review [Exploration Finland](index=66&type=section&id=Exploration%20Finland) This section reviews the company's exploration activities in Finland, including drilling progress at Jokisivu gold mine, cessation of mining at Kaapelinkulma and Orivesi gold mines, and exploration at Uunimäki gold project and Stormi nickel-copper mine - The company holds a group of projects in Southern Finland, totaling **1,037.89 hectares**, which collectively form the Vammala Production Centre[333](index=333&type=chunk)[335](index=335&type=chunk) - At the Jokisivu gold mine, **48 underground diamond core drill holes** totaling **6,701.40 meters** were drilled during the period, with positive assay results received from the 2024 final exploration activities[337](index=337&type=chunk)[339](index=339&type=chunk)[340](index=340&type=chunk)[341](index=341&type=chunk) - Mining activities at the Kaapelinkulma gold mine and Orivesi gold mine ceased in April 2021 and June 2019, respectively, with **no exploration activities conducted** during the period[346](index=346&type=chunk)[349](index=349&type=chunk)[352](index=352&type=chunk)[353](index=353&type=chunk) - The Uunimäki gold project saw its **first drilling campaign** during the period, completing **21 drill holes** totaling **2,369.45 meters of diamond drilling**[356](index=356&type=chunk)[361](index=361&type=chunk) [Exploration Sweden](index=71&type=section&id=Exploration%20Sweden) This section reviews the company's exploration activities in Sweden, including the status of Fäboliden and Svartliden gold mines, with Fäboliden exploration paused due to environmental permit issues and Svartliden mining completed - The company holds **3,536.89 hectares** of land tenure in Northern Sweden, collectively known as the Svartliden Production Centre[363](index=363&type=chunk)[364](index=364&type=chunk) - Exploration activities at the Fäboliden gold mine were **not conducted** during the period due to the ruling by the Swedish Land and Environment Court[367](index=367&type=chunk)[372](index=372&type=chunk) - Mining at the Svartliden gold mine was **completed by the end of 2013**, and no exploration activities were conducted in its mining area during the period[369](index=369&type=chunk)[370](index=370&type=chunk)[373](index=373&type=chunk) [Resources and Reserves](index=72&type=section&id=Resources%20and%20Reserves) This section provides updated estimates for mineral resources and ore reserves in Finland and Sweden, showing increases in mineral resources and ore reserves for Kaapelinkulma and Fäboliden - Independent consultants have reviewed the company's mineral resource and ore reserve estimates in Finland and Sweden, with updated estimates for Kaapelinkulma, Fäboliden, Orivesi, and Svartliden as of May 1, 2025[371](index=371&type=chunk)[374](index=374&type=chunk) Vammala Production Centre Mineral Resource Estimates (As of May 1, 2025) | Mining Area | Category | Tonnes (thousand tonnes) | Gold (grams/tonne) | Ounces (thousand ounces) | | :--- | :--- | :--- | :--- | :--- | | Jokisivu Gold Mine | Measured | 520 | 3.5 | 59 | | | Indicated | 1,500 | 2.9 | 140 | | | Inferred | 670 | 2.7 | 59 | | Kaapelinkulma Gold Mine | Measured | 21 | 1.9 | 1 | | | Indicated | 63 | 2.9 | 6 | | | Inferred | 98 | 4.8 | 15 | | Orivesi Gold Mine | Measured | 93 | 5.0 | 15 | | | Indicated | 110 | 5.9 | 21 | | | Inferred | 71 | 4.8 | 11 | | **VPC Total** | **Total** | **3,100** | **3.2** | **320** | Svartliden Production Centre Mineral Resource Estimates (As of May 1, 2025) | Mining Area | Category | Tonnes (thousand tonnes) | Gold (grams/tonne) | Ounces (thousand ounces) | | :--- | :--- | :--- | :--- | :--- | | Fäboliden Gold Mine | Measured | 100 | 3.3 | 11 | | | Indicated | 6,000 | 2.6 | 510 | | | Inferred | 5,200 | 3.3 | 560 | | Svartliden Gold Mine | Measured | 120 | 3.4 | 13 | | | Indicated | 310 | 3.8 | 38 | | | Inferred | 60 | 4.0 | 8 | | **SPC Total** | **Total** | **12,000** | **3.0** | **1,100** | Group Total Ore Reserves (As of May 1, 2025) | Mining Area | Category | Tonnes (thousand tonnes) | Gold (grams/tonne) | Ounces (thousand ounces) | | :--- | :--- | :--- | :--- | :--- | | Jokisivu (Underground) | Proved | 300 | 2.5 | 24 | | | Probable | 930 | 2.2 | 66 | | Fäboliden (Open Pit) | Probable | 3,200 | 3.0 | 310 | | **Group Total** | **Total** | **4,500** | **2.8** | **400** | [Competent Persons Statement](index=77&type=section&id=Competent%20Persons%20Statement) This section confirms that exploration results, mineral resource, and ore reserve estimates in the report were prepared and reviewed by competent persons, comply with reporting codes, and no new information significantly impacts the data - Exploration results were prepared by Mr. Neale Edwards, a full-time employee of Dragon Mining Limited, who has relevant experience and qualifies as a Competent Person[405](index=405&type=chunk)[406](index=406&type=chunk)[409](index=409&type=chunk) - Mineral resource estimates were reviewed and compiled by Mr. Shaun Searle, a Director of Ashmore Advisory Pty Ltd, who qualifies as a Competent Person[410](index=410&type=chunk)[413](index=413&type=chunk)[415](index=415&type=chunk)[418](index=418&type=chunk) - Ore reserve estimates were prepared and reviewed by Mr. Joe McDiarmid, a full-time employee of MoJoe Mining Pty Ltd, and Mr. Ian Sheppard, an employee of SLR, both of whom qualify as Competent Persons[420](index=420&type=chunk)[423](index=423&type=chunk)[424](index=424&type=chunk)[425](index=425&type=chunk) - The company confirms that no new information or data has been identified that would materially affect the reported exploration results, mineral resource, and ore reserve estimates[407](index=407&type=chunk)[411](index=411&type=chunk)[416](index=416&type=chunk)[419](index=419&type=chunk)[421](index=421&type=chunk)[426](index=426&type=chunk) Environmental Review [Finland Environmental Review](index=82&type=section&id=Finland%20Environmental%20Review) This section reviews environmental management and monitoring at the Vammala Production Centre, Orivesi, Jokisivu, Kaapelinkulma, and Uunimäki in Finland, covering environmental permits, water management, dust control, ecological surveys, and closure plans - The Vammala environmental permit was upheld by the Supreme Administrative Court, but with a **reduced capacity to 300,000 tonnes per annum** and requirements for additional environmental impact monitoring and water management improvements[432](index=432&type=chunk)[435](index=435&type=chunk) - Dust generation occurred at the Vammala tailings area, with dust concentrations exceeding limits, and the company is planning to **upgrade its dust control system**[445](index=445&type=chunk)[448](index=448&type=chunk) - The Natura assessment report for the Orivesi gold mine has been submitted, recommending **progressive approval of the closure plan**, and fish and crayfish populations show positive growth[450](index=450&type=chunk)[453](index=453&type=chunk)[455](index=455&type=chunk)[459](index=459&type=chunk)[460](index=460&type=chunk) - The Jokisivu gold mine received a new environmental permit, allowing for **increased crushing volume and earlier loading and transport operations**, but faces an appeal from an NGO[468](index=468&type=chunk)[471](index=471&type=chunk)[473](index=473&type=chunk)[474](index=474&type=chunk) - Closure work and waste rock utilization are progressing at the Kaapelinkulma gold mine, and a contaminated soil study recommends covering with topsoil[477](index=477&type=chunk)[478](index=478&type=chunk)[481](index=481&type=chunk)[482](index=482&type=chunk) [Sweden Environmental Review](index=92&type=section&id=Sweden%20Environmental%20Review) This section reviews environmental management at Svartliden in Sweden, including reclamation plan progress, approval of Fäboliden ore processing permit changes, and rejection of the Fäboliden full-scale mining environmental permit application - The Svartliden reclamation plan requires **hard covering of the entire waste rock dump** and an **additional SEK 32.0 million** (approximately AUD 5.1 million) in collateral guarantees[497](index=497&type=chunk)[500](index=500&type=chunk) - The permit change for the Svartliden plant to process Fäboliden ore was **approved by the Environmental Court**, and Vapsten's appeal was rejected[499](index=499&type=chunk)[501](index=501&type=chunk) - The environmental permit application for full-scale mining at Fäboliden was **rejected by the Environmental Court**, and the company plans to **resubmit a revised application** to mitigate the Environmental Court's concerns[503](index=503&type=chunk)[504](index=504&type=chunk)

Q P Group Holdings Limited 雋思集團控股有限公司 (Incorporated in the Cayman Islands with limited liability) Stock code 股份代號 : 1412 （於開曼群島註冊成立的有限公司） INTERIM REPORT 2025 中期報告 雋思集團控股有限公司 INTERIM REPORT 2025 中期報告 Q P Group Holdings Limited 雋思集團控股有限公司 CONTENTS 目錄 中期簡明綜合損益及其他全面收益表 32 Interim Condensed Consolidated Statement of Financial Position Q P Group Holdings Limited 中期簡明綜合財務狀況表 34 Interim Condensed Consolidated Statement of Changes in Equity 中期簡明綜合權益變動表 36 Interim Condensed Consolidated Statement of Cash Flows 中期簡明綜合 ...

CONTENTS 目 錄 19 CHAPTER SIX MANAGEMENT DISCUSSION AND ANALYSIS 53 CHAPTER SEVEN CORPORATE GOVERNANCE AND OTHER INFORMATION 65 CHAPTER EIGHT INTERIM FINANCIAL INFORMATION 2 CHAPTER ONE CORPORATE INFORMATION 第一章 公司資料 5 CHAPTER TWO LETTER FROM THE CHAIRPERSON 第二章 董事長致辭 10 CHAPTER THREE DEFINITIONS 第三章 釋 義 15 CHAPTER FOUR GLOSSARY OF TECHNICAL TERMS 第四章 技術詞彙 17 CHAPTER FIVE SUMMARY OF FINANCIAL AND OPERATING DATA 第五章 財務及經營數據摘要 第六章 管理層討論與分析 第七章 企業管治及其他資料 第八章 中期財務資料 CHAPTER ONE CORPORATE INFORMATION 第一章 公司資料 | RE ...

Corporate Information [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) This section lists the composition of the company's Board of Directors, including executive, non-executive, and independent non-executive directors, as well as changes in the chairpersons of the Audit, Remuneration, and Nomination Committees - The Board of Directors includes executive directors such as **Dr. Zhou Jinhuang** (Chairman), **Mr. Guan Heng** (CEO), and **Mr. Huang Junmou** (Honorary Chairman); non-executive directors such as Mr. Fan Weiguo and Mr. Yu Zida; and independent non-executive directors such as Mr. Zhang Mingqun, Dr. Li Yao, and Ms. Xiang Ting[6](index=6&type=chunk)[7](index=7&type=chunk) - Changes occurred in the chairpersons of the Audit, Remuneration, and Nomination Committees, with **Ms. Xiang Ting** appointed as Audit Committee Chairwoman on **May 12, 2025**, and Ms. Zou Guoying resigning on the same day[6](index=6&type=chunk)[7](index=7&type=chunk) [Company Contacts and Registrars](index=4&type=section&id=Company%20Contacts%20and%20Registrars) This section provides detailed addresses for the company's registered office in the Cayman Islands, China headquarters, and principal place of business in Hong Kong, along with information on the principal share registrar and Hong Kong share registrar - The Company is registered in the Cayman Islands, headquartered in Nanshan District, Shenzhen, China, with its principal place of business in Hong Kong located on Queen's Road East, Wan Chai[9](index=9&type=chunk)[10](index=10&type=chunk) - The principal share registrar and transfer office is **Maples Fund Services (Cayman) Limited**, and the Hong Kong share registrar is **Hong Kong Central Share Registrar Limited**[9](index=9&type=chunk)[10](index=10&type=chunk) [Legal and Audit Information](index=4&type=section&id=Legal%20and%20Audit%20Information) This section lists the company's legal counsel in Hong Kong and the Cayman Islands, as well as detailed information on its external auditor - Hong Kong legal counsel is **Chow Chun Hin Solicitors in association with Commerce & Finance Law Offices**, and Cayman Islands legal counsel is **Maples and Calder (Hong Kong) LLP**[11](index=11&type=chunk)[12](index=12&type=chunk) - The Company's auditor is **UHY CPA Limited**, a registered public interest entity auditor[12](index=12&type=chunk) [Principal Bankers and Stock Details](index=5&type=section&id=Principal%20Bankers%20and%20Stock%20Details) This section provides the names and addresses of the company's principal bankers, along with its stock code and official website - Principal bankers include branches of **China Construction Bank**, **Bank of China**, and **China Everbright Bank** in Shenzhen[12](index=12&type=chunk) - The Company's stock code is **3773**, and its official website is **www.ysdf.com.cn**[12](index=12&type=chunk)[13](index=13&type=chunk) Management Discussion and Analysis [Business Review](index=6&type=section&id=Business%20Review) In H1 2025, China's consumer sector saw a moderate recovery, digital rights product penetration increased, and explosive AI growth reshaped the digital marketing industry chain. The Group optimized its business structure, focused on high-margin segments, increased AI R&D investment, and achieved strong growth in digital marketing revenue, but profit attributable to owners decreased due to increased strategic transformation investments - China's consumer sector experienced a **moderate recovery** supported by policies and restored consumer confidence, leading to **increased penetration of digital rights products**[16](index=16&type=chunk)[19](index=19&type=chunk) - Artificial intelligence (AI) technology saw **explosive growth** in vertical application fields, profoundly reshaping the digital marketing industry chain ecosystem[16](index=16&type=chunk)[19](index=19&type=chunk) H1 2025 Key Financial Indicators | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Revenue | 69.9 | 61.3 | +14.0% | | Gross Profit | 44.1 | 48.1 | -8.3% | | Digital Marketing Business Revenue | 34.3 | 8.9 | Significant growth | | Profit Attributable to Owners of the Company | 12.5 | 21.3 | -41.3% | | R&D Expenses | 6.1 | 5.3 | +15.1% | - The Group's Shenzhen Niannianka Network Technology Co., Ltd. secured bids for projects from several large banks and established partnerships with renowned consumer brands such as Mixue Bingcheng, Cha Bai Dao, Ba Wang Cha Ji, and KFC, **solidifying its competitive position** in the industry[23](index=23&type=chunk)[25](index=25&type=chunk) - The Group, driven by digitalization, **focuses on AI agents**, intelligent user operations, and omni-channel data platform development, officially launching its self-developed digital rights trading platform 'Shuhui Jucai Mall' and upgrading the 'Shuhui Master' intelligent platform system[28](index=28&type=chunk)[31](index=31&type=chunk) [Outlook](index=9&type=section&id=Outlook) Management anticipates significant growth for AI agents in vertical applications within digital rights trading. The Group will continue to integrate technological innovation deeply with core business processes, increase AI R&D investment, develop AI agent tools, accelerate overseas business expansion, and optimize internal resources and talent development for sustainable growth and long-term value creation - General AI large models, represented by GROK-4, have achieved breakthroughs in multi-step reasoning, tool invocation, and task closure capabilities, making AI agents **viable for vertical applications** in digital rights trading, with demand expected to **grow significantly**[32](index=32&type=chunk)[33](index=33&type=chunk) - The Group will continue to integrate technological innovation deeply with core business processes, **increase R&D investment in AI**, and develop AI agent tools for digital rights consumption to create diverse value experiences for consumers[32](index=32&type=chunk)[33](index=33&type=chunk) - The Group will **accelerate its overseas expansion**, explore more diverse markets, and focus on internal resource aggregation and synergy, talent acquisition and development, continuously optimizing organizational structure and innovation efficiency[32](index=32&type=chunk)[33](index=33&type=chunk) [Financial Review](index=10&type=section&id=Financial%20Review) This section provides a detailed review of the Group's financial performance in H1 2025, including revenue growth, gross profit decline, changes in various expenses, and key financial indicators such as liquidity, capital structure, and receivables. Revenue growth was primarily driven by strong digital marketing business performance, but gross profit margin decreased due to rising costs, while increased R&D and sales investments led to a significant decline in net profit [Revenue](index=10&type=section&id=Revenue) The Group's total revenue increased by 14.0% year-on-year to RMB69.9 million, primarily driven by significant growth in digital marketing service revenue and transaction volume, offsetting the decline in mobile phone top-up service revenue Revenue Comparison (H1 2025 vs H1 2024) | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Total Revenue | 69.9 | 61.3 | +14.0% | | Digital Marketing Business Revenue | 34.3 | 8.9 | Significant growth | - Digital marketing business revenue **significantly increased**, primarily due to expanded collaborations with well-known lifestyle service brands like WeChat Pay, Alipay (for instant discounts, coupons, and loyalty points marketing), financial channel clients, and large state-owned banks[36](index=36&type=chunk)[40](index=40&type=chunk) [Cost of Revenue](index=10&type=section&id=Cost%20of%20Revenue) Cost of revenue significantly increased by 114.3% year-on-year to RMB25.5 million, primarily due to higher costs associated with digital marketing services Cost of Revenue Comparison (H1 2025 vs H1 2024) | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Cost of Revenue | 25.5 | 11.9 | +114.3% | - The **significant increase** in cost of revenue was primarily attributable to higher costs associated with digital marketing services during the reporting period[37](index=37&type=chunk)[41](index=41&type=chunk) [Gross Profit and Gross Profit Margin](index=10&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit decreased by 8.3% year-on-year to RMB44.1 million, with the overall gross profit margin falling from 78.5% to 63.1%, mainly due to increased transaction volume in digital marketing services leading to higher platform fees and promotion costs Gross Profit and Gross Profit Margin Comparison (H1 2025 vs H1 2024) | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Gross Profit | 44.1 | 48.1 | -8.3% | | Gross Profit Margin | 63.1% | 78.5% | -15.4 percentage points | - The **decrease in gross profit margin** was mainly due to increased transaction volume in digital marketing services, leading to higher platform fees and promotion costs[39](index=39&type=chunk)[42](index=42&type=chunk) [Other Income, net](index=11&type=section&id=Other%20Income%2C%20net) Other income, net, significantly decreased by 63.2% year-on-year to RMB2.8 million, primarily due to reduced government subsidies Other Income, net Comparison (H1 2025 vs H1 2024) | Indicator

05 業務發展回顧 07 財務回顧 17 業務前景 19 獨立審閱報告 21 簡明綜合損益表 22 簡明綜合損益及其他全面收益表 23 簡明綜合財務狀況表 25 簡明綜合權益變動表 26 簡明綜合現金流量表 27 簡明綜合財務報表附註 45 其他資料 環 球 新 材 國 際 控 股 有 限 公 司 2025中 期 報 告 公司資料 目 02 公司資料 03 主席報告 錄 董事會 執行董事 苏尔田博士 （主席兼行政總裁） 金增勤先生 周方超先生 （聯席公司秘書） 白植煥先生 曾珠女士 林光水先生 非執行董事 胡永祥先生 獨立非執行董事 許之豐先生 韓高榮教授 梁貴華先生 陳發動教授 審核委員會 許之豐先生 （主席） 韓高榮教授 梁貴華先生 薪酬委員會 梁貴華先生 （主席） 韓高榮教授 周方超先生 於中國內地： 柳州銀行股份有限公司 柳州市區農村信用合作聯社 於大韓民國： 新韓銀行忠北營業部 註冊辦事處 提名委員會 苏尔田博士 （主席） 韓高榮教授 許之豐先生 曾珠女士 陳發動教授 聯席公司秘書 周方超先生 張嘉倫女士 核數師 羅申美會計師事務所 註冊會計師 （根據《會計及財務匯報局條例》 註冊的公共利益實體核數 ...

SOLIS HOLDINGS LIMITED （於開曼群島註冊成立的有限公司） 股份代號： 2227 2025 中期報告 目錄 | 公司資料 | 2 | | --- | --- | | 管理層討論及分析 | 4 | | 其他資料 | 9 | | 合併損益及其他全面收益表 | 14 | | 合併財務狀況表 | 15 | | 合併權益變動表 | 16 | | 合併現金流量表 | 17 | | 合併財務報表附註 | 19 | 01 守益控股有限公司 2025年中期報告 公司資料 薛淑玲女士 （主席） 黃仲權先生 張瑞清先生 企業管治委員會 執行董事 鄭湧華先生 （主席） 張瑞清先生 獨立非執行董事 薛淑玲女士 鍾比能先生 黃仲權先生 審核委員會 黃仲權先生 （主席） 鍾比能先生 薛淑玲女士 薪酬委員會 鍾比能先生 （主席） 鄭湧華先生 薛淑玲女士 提名委員會 張瑞清先生 （主席） 鍾比能先生 黃仲權先生 公司秘書 錢盈盈女士 授權代表 張瑞清先生 錢盈盈女士 註冊辦事處 Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman ...

Company Information This section presents fundamental company information, covering board structure, banking, H share registrar, stock code, and website [Board of Directors](index=3&type=section&id=Board%20of%20Directors) The company's Board of Directors is led by Mr. Liu Gexin, Chairman and Non-executive Director, and includes Executive Director Dr. Ge Junyou, several Non-executive Directors, and Independent Non-executive Directors, with Audit, Remuneration, and Nomination Committees all established and chaired by Independent Non-executive Directors - Chairman and Non-executive Director: **Mr. Liu Gexin**[5](index=5&type=chunk) - Executive Director: **Dr. Ge Junyou**[5](index=5&type=chunk) - Chairman of the Audit Committee: **Dr. Li Yedong** (Independent Non-executive Director)[5](index=5&type=chunk) - Auditor: **KPMG**[5](index=5&type=chunk) [Principal Banks](index=4&type=section&id=Principal%20Banks) The company maintains relationships with several principal banks in China, including Bank of China, Industrial Bank, CITIC Bank, and China Merchants Bank - Principal banks include **Bank of China, Industrial Bank, CITIC Bank, and China Merchants Bank**[6](index=6&type=chunk) [H Share Registrar](index=4&type=section&id=H%20Share%20Registrar) The company's H share registrar is Hong Kong Central Share Registrar Limited, located in Wan Chai, Hong Kong - H Share Registrar: **Hong Kong Central Share Registrar Limited**[6](index=6&type=chunk) [Stock Code](index=4&type=section&id=Stock%20Code) The company's H share stock code is 06990 - H Share Stock Code: **06990**[6](index=6&type=chunk) [Company Website](index=4&type=section&id=Company%20Website) The company's official website is https://kelun-biotech.com - Company Website: **https://kelun-biotech.com**[6](index=6&type=chunk) Financial and Business Highlights This section summarizes the company's financial performance and key business achievements, including revenue, profit/loss, and significant progress in drug development and commercialization [Financial Highlights](index=5&type=section&id=Financial%20Highlights) For the six months ended June 30, 2025, the company's revenue decreased by 31.3% year-on-year to RMB 950.4 million, with a loss of RMB 145.2 million for the period, compared to a profit of RMB 310.2 million in the prior year, while cash and financial assets and total equity both saw significant growth Financial Highlights for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | Period Change | | :--- | :--- | :--- | :--- | | Revenue | 950,445 | 1,382,791 | -31.3% | | R&D Expenses | (611,539) | (652,337) | -6.3% | | (Loss)/Profit for the Period | (145,175) | 310,226 | -146.8% | | Adjusted (Loss)/Profit for the Period | (69,398) | 385,636 | -118.0% | | **As of June 30, 2025** | **As of December 31, 2024** | | | | Cash and Financial Assets | 4,527,814 | 3,075,651 | 47.2% | | Total Equity | 5,014,290 | 3,308,661 | 51.6% | [Business Highlights](index=5&type=section&id=Business%20Highlights) The company achieved encouraging progress in both ADC and novel conjugate drug assets and non-conjugate drug assets, with multiple core products receiving marketing approval or entering the NDA stage, actively advancing commercialization and global collaborations, and achieving total commercial sales of RMB 309.8 million in the first half, with sac-TMT (Aitaiwei®) contributing 97.6% - Since early 2025, the company's business has achieved **encouraging progress**[10](index=10&type=chunk) - Total commercial sales reached **RMB 309.8 million** in the first half of 2025, with sac-TMT (Aitaiwei®) sales accounting for **97.6%**[33](index=33&type=chunk) [Key Developments in ADC and Novel Conjugate Drug Assets](index=5&type=section&id=Key%20Developments%20in%20ADC%20and%20Novel%20Conjugate%20Drug%20Assets) The company made several key advancements in ADC and novel conjugate drug assets, with core product sac-TMT (Aitaiwei®) approved for TNBC and EGFR-mutated NSCLC, and multiple global Phase 3 clinical studies underway, while bodotuximab (Shutaiwei®) NDA has been accepted, and other novel ADC drugs are in clinical trials - Possesses **over 10 ADC and novel conjugate drug assets** in clinical or later stages[10](index=10&type=chunk) - sac-TMT (Aitaiwei®) has received **two marketing approvals**, and bodotuximab (Shutaiwei®) has reached the **NDA stage**[10](index=10&type=chunk) [Key Developments in Non-Conjugate Drug Assets](index=10&type=section&id=Key%20Developments%20in%20Non-Conjugate%20Drug%20Assets) The company also made significant progress in non-conjugate drug assets, with tagolimab (Ketaiwei®) approved for first-line and second-line treatment of nasopharyngeal carcinoma, and cetuximab N01 (Daitaiwei®) approved for first-line treatment of RAS wild-type metastatic colorectal cancer, while A400/EP0031 showed good efficacy in advanced RET-mutated MTC patients and received FDA Fast Track designation - Tagolimab (Ketaiwei®) has been approved by the NMPA for the treatment of recurrent or metastatic NPC patients and in combination with chemotherapy for first-line treatment[30](index=30&type=chunk) - Cetuximab N01 (Daitaiwei®) has been approved by the NMPA in combination with FOLFOX or FOLFIRI regimens for first-line treatment of RAS wild-type metastatic colorectal cancer[30](index=30&type=chunk) - Phase I study results of A400 in advanced RET-mutated MTC patients showed an overall confirmed ORR of **63.0%** and a DCR of **100%**[32](index=32&type=chunk) [Commercialization](index=11&type=section&id=Commercialization) The company has successfully commercialized sac-TMT (Aitaiwei®), tagolimab (Ketaiwei®), and cetuximab N01 (Daitaiwei®), and expects to launch bodotuximab (Shutaiwei®) and submit NDA for A400 in the second half of 2025, with a commercial network covering 30 provinces and over 2,000 hospitals, actively promoting product inclusion in national medical insurance and provincial/municipal inclusive insurance - Marketing approvals for sac-TMT (Aitaiwei®), tagolimab (Ketaiwei®), and cetuximab N01 (Daitaiwei®) have been obtained, and commercialization has commenced[34](index=34&type=chunk) - Expected to launch bodotuximab (Shutaiwei®) in the Chinese market and submit an NDA for A400 in the **second half of 2025**[34](index=34&type=chunk) - Business has covered **30 provinces, over 300 prefecture-level cities, and over 2,000 hospitals**, with sales revenue achieved in over 1,000 hospitals[35](index=35&type=chunk) - Aitaiwei® has completed listing in **29 provinces**, Ketaiwei® in **25 provinces**, and Daitaiwei® in **15 provinces**[36](index=36&type=chunk) - All launched products (Aitaiwei®, Ketaiwei®, and Daitaiwei®) have passed the preliminary formal review for the National Medical Insurance Drug Catalogue[36](index=36&type=chunk) [Licensing and Collaboration Arrangement Highlights](index=13&type=section&id=Licensing%20and%20Collaboration%20Arrangement%20Highlights) The company has established multiple strategic collaborations with Merck, Ellipses Pharma, and Windward Bio, with the Merck collaboration covering global development and commercialization of sac-TMT and other ADC assets, Ellipses Pharma advancing global clinical development of A400 with FDA Fast Track designation, and Windward Bio collaborating on SKB378/WIN378, having received upfront payment and equity - Entered into a licensing and collaboration agreement with Merck for the development of multiple ADC assets for cancer treatment, with exclusive rights for sac-TMT outside Greater China granted to Merck[37](index=37&type=chunk) - Merck is advancing **14 global multi-center Phase 3 clinical studies** for sac-TMT across multiple cancer types[20](index=20&type=chunk) - Collaborating with Ellipses Pharma on the development of A400/EP0031, which has received **FDA Fast Track designation** and approval to enter Phase 2 clinical development[43](index=43&type=chunk) - Entered into an exclusive licensing agreement with Windward Bio, granting them rights for the development, manufacturing, and commercialization of SKB378/WIN378 globally (excluding Greater China and certain Southeast Asian and West Asian countries)[43](index=43&type=chunk) - The company and Harbour BioMed are eligible to receive a combined maximum of **USD 970 million** in upfront and milestone payments, plus tiered royalties ranging from single-digit to double-digit percentages based on net sales of SKB378/WIN378[42](index=42&type=chunk) [Environmental, Social and Governance](index=15&type=section&id=Environmental%2C%20Social%20and%20Governance) The company has established a comprehensive three-tier ESG governance framework, with the Board of Directors as the highest decision-making body, and received the "Best ESG" award from Extel in May 2025 - A comprehensive three-tier ESG governance framework has been established, consisting of the **Board of Directors, ESG Working Group, and ESG Executive Body**[44](index=44&type=chunk) - Awarded "**Best ESG**" by Extel (formerly "Institutional Investor") in **May 2025**[44](index=44&type=chunk) [Placement of New H Shares](index=15&type=section&id=Placement%20of%20New%20H%20Shares) The company completed the placement of 5,918,000 H shares on June 12, 2025, at a placement price of HKD 331.80 per share, raising net proceeds of approximately HKD 1,943.0 million - On **June 12, 2025**, completed the placement of **5,918,000 H shares** to no less than six placees at a placement price of **HKD 331.80 per share**[44](index=44&type=chunk) - Net proceeds from the placement amounted to approximately **HKD 1,943.0 million**[44](index=44&type=chunk) Management Discussion and Analysis This section provides an in-depth review of the company's business operations, financial performance, and future outlook, highlighting strategic initiatives and key achievements [I. Business Review](index=16&type=section&id=I.%20Business%20Review) The company is a biopharmaceutical firm focused on innovative drug R&D, manufacturing, and commercialization in oncology, immunology, and other therapeutic areas, with core products sac-TMT and bodotuximab achieving significant progress, and continuously expanding its diversified pipeline and commercialization infrastructure through three major technology platforms and global strategic partnerships - The company is a biopharmaceutical company dedicated to the R&D, manufacturing, and commercialization of innovative drugs in oncology, immunology, and other therapeutic areas[45](index=45&type=chunk) - Possesses two core ADC drugs: **sac-TMT (TROP2 ADC)** and **bodotuximab (HER2 ADC)**[45](index=45&type=chunk) - Has a pipeline of **over 30 drug candidates** under development, with **more than 10** in clinical stages[45](index=45&type=chunk) - Licensing and collaboration agreements with partners such as Merck, Ellipses Pharma, and Windward Bio demonstrate R&D and business development capabilities[47](index=47&type=chunk) [Overview](index=16&type=section&id=Overview) The company is a biopharmaceutical firm focused on innovative drug R&D, manufacturing, and commercialization in oncology, immunology, and other therapeutic areas, with core products sac-TMT and bodotuximab, a pipeline of over 30 drug candidates, and development driven by internal technology platforms and global strategic partnerships - The company is one of the **pioneers in ADC development**, accumulating **over a decade of experience** in ADC development[46](index=46&type=chunk) - Is one of the first biopharmaceutical companies in China and among a few globally to establish an in-house developed ADC and novel conjugate drug platform, **OptiDC™**[46](index=46&type=chunk) [Our Pipeline](index=16&type=section&id=Our%20Pipeline) The company's pipeline includes over thirty drug candidates, with more than ten in clinical stages, primarily targeting prevalent or refractory cancers such as breast cancer, non-small cell lung cancer, gastrointestinal cancers, and gynecological tumors, as well as non-oncology diseases like autoimmune and metabolic disorders, with core products sac-TMT and bodotuximab showing significant progress, and multiple novel ADC and non-conjugate drugs achieving important clinical data and regulatory approvals - The pipeline targets prevalent or refractory cancers worldwide, such as **BC, NSCLC, GI cancers, and gynecological tumors**, as well as non-oncology diseases and conditions with large patient populations and unmet medical needs[48](index=48&type=chunk) - A robust pipeline has been established, comprising **over thirty drug candidates**, including **more than ten clinical-stage candidates**[48](index=48&type=chunk) [Our Oncology Pipeline](index=17&type=section&id=Our%20Oncology%20Pipeline) The oncology pipeline features diverse therapeutic options and differentiated mechanisms, comprehensively covering prevalent or refractory cancers domestically and internationally, with core product sac-TMT approved for TNBC and EGFR-mutated NSCLC and advancing multiple global Phase 3 clinical trials, bodotuximab NDA accepted, and multiple novel ADCs (e.g., SKB315, SKB410) and immunotherapy/targeted therapy drugs (e.g., tagolimab, cetuximab N01, A400) also making significant progress - Sac-TMT (Aitaiwei®) has been approved by the NMPA for marketing in China for the treatment of adult patients with unresectable locally advanced or metastatic TNBC who have previously received at least two systemic therapies[53](index=53&type=chunk) - Sac-TMT is the **first domestically developed ADC with global intellectual property rights** to receive full marketing approval in China[53](index=53&type=chunk) - The NDA for bodotuximab (Shutaiwei®) has been accepted by the NMPA's CDE for the treatment of adult patients with HER2+ unresectable or metastatic BC who have previously received at least one anti-HER2 therapy[66](index=66&type=chunk) - Tagolimab (Ketaiwei®) is the **world's first PD-L1 monoclonal antibody** approved for first-line treatment of nasopharyngeal carcinoma[75](index=75&type=chunk) [Non-Oncology Pipeline](index=24&type=section&id=Non-Oncology%20Pipeline) The non-oncology pipeline primarily focuses on immune-mediated diseases such as moderate-to-severe asthma and thromboembolic diseases, with SKB378 (TSLP mAb) having completed Phase 1 clinical trials in China and received IND approval for COPD, and partner Windward Bio initiating the Phase 2 POLARIS trial, while SKB336 (FXI/FXIa mAb) has completed Phase 1 clinical trials in China - SKB378 (TSLP mAb) is expected to be one of the **first independently developed anti-TSLP monoclonal antibodies in China** for the treatment of patients with moderate-to-severe asthma[88](index=88&type=chunk) - The IND application for SKB378 for the treatment of COPD was approved by the NMPA in **January 2025**[89](index=89&type=chunk) - SKB336 (FXI/FXIa mAb) has completed Phase 1 trials in China, aiming to serve as an anticoagulant for the prevention and treatment of thromboembolic diseases[91](index=91&type=chunk) [Our Technology Platforms](index=25&type=section&id=Our%20Technology%20Platforms) The company has established three core technology platforms focusing on ADC and novel conjugate drugs, biologics, and small molecules, supporting the discovery and development of innovative drugs, with the OptiDC™ platform accumulating a decade of experience in ADC development, possessing expertise in conjugate drug design, development, and a core component library, while the biologics platform utilizes advanced technologies to accelerate antibody discovery, and the small molecule platform is driven by medicinal chemistry and AIDD technologies - Three core platforms have been established, focusing on **ADC and novel conjugate drugs, biologics, and small molecules**, respectively[93](index=93&type=chunk) - The ADC and novel conjugate drug platform, **OptiDC™**, is supported by deep understanding of biological targets and diseases, tested and validated expertise in conjugate drug design and development, and a library of conjugate drug core components[94](index=94&type=chunk) - The biologics platform accelerates the generation of innovative antibodies by integrating a **monoclonal B-cell screening platform, next-generation sequencing, and high-throughput screening and analysis**[99](index=99&type=chunk) - The small molecule platform is driven by integrated **medicinal chemistry, computer-aided drug design (CADD), and AIDD technologies**[99](index=99&type=chunk) [Research and Development](index=27&type=section&id=Research%20and%20Development) The company possesses a comprehensive in-house R&D engine covering drug discovery, translational medicine, process development, and clinical research, staffed by experienced industry veterans, utilizing AI technology to enhance efficiency and ensure the quality and efficiency of drug development at all stages - In-house R&D capabilities allow the company to flexibly control and supervise the R&D process, reduce reliance on CROs, and ensure the quality and efficiency of drug development projects[98](index=98&type=chunk) - AI has been introduced into multiple R&D processes to further enhance R&D efficiency, such as **AI-assisted antibody sequence prediction and binding site prediction**[102](index=102&type=chunk) [Our Licensing and Collaboration Arrangements](index=28&type=section&id=Our%20Licensing%20and%20Collaboration%20Arrangements) The company actively seeks external collaborations to generate synergies, partnering with Merck for the development of multiple ADC assets, with exclusive rights for sac-TMT outside Greater China granted to Merck, and 14 global Phase 3 clinical studies underway, collaborating with Ellipses Pharma for A400, which has received FDA Fast Track designation, and with Windward Bio for SKB378/WIN378, having received upfront payment and equity - Collaboration with Merck: Granted Merck exclusive license to develop, use, manufacture, and commercialize sac-TMT outside Greater China, with Merck initiating **14 global Phase 3 clinical studies**[105](index=105&type=chunk) - Collaboration with Ellipses Pharma: Granted exclusive license for A400 outside Greater China and certain Asian countries, with A400/EP0031 receiving **FDA Fast Track designation**[111](index=111&type=chunk) - Collaboration with Windward Bio: Granted exclusive license for SKB378/WIN378 globally (excluding Greater China and certain Southeast Asian and West Asian countries), having received upfront payment and equity in Windward Bio's parent company[109](index=109&type=chunk) [Manufacturing and Quality Management](index=31&type=section&id=Manufacturing%20and%20Quality%20Management) The company possesses cGMP-compliant end-to-end manufacturing facilities covering the entire lifecycle of ADC development, continuously improving its integrated quality management system, and bodotuximab has been approved by the NMPA to conduct a cross-provincial segmented production pilot program - The main manufacturing base in Chengdu is one of the few cGMP-compliant facilities in China with **end-to-end capabilities for ADC development**[116](index=116&type=chunk) - Bodotuximab (Shutaiwei®) received formal approval from the NMPA to conduct a **cross-provincial segmented production pilot program**[116](index=116&type=chunk) [Commercialization](index=31&type=section&id=Commercialization) The company has successfully commercialized sac-TMT (Aitaiwei®), tagolimab (Ketaiwei®), and cetuximab N01 (Daitaiwei®), and expects to launch bodotuximab (Shutaiwei®) and submit NDA for A400 in the second half of 2025, with a commercial network covering 30 provinces and over 2,000 hospitals, actively promoting product inclusion in national medical insurance and provincial/municipal inclusive insurance - Total commercial sales reached **RMB 309.8 million** in the first half of 2025, with sac-TMT (Aitaiwei®) sales accounting for **97.6%**[115](index=115&type=chunk) - A mature marketing team of **over 350 people** has been established, dedicated to the marketing and commercialization of strategic products[117](index=117&type=chunk) - Aitaiwei® has completed listing in **29 provinces**, Ketaiwei® in **25 provinces**, and Daitaiwei® in **15 provinces**[118](index=118&type=chunk) - All launched products have passed the preliminary formal review for the National Medical Insurance Drug Catalogue, and Aitaiwei® has been included in inclusive insurance schemes in **over 7 provinces and more than 20 cities**[118](index=118&type=chunk) [Awards and Recognition](index=33&type=section&id=Awards%20and%20Recognition) The company received multiple industry awards in 2025, including "Asia's Best Company" from FinanceAsia, "Most Honored Company" and "Best ESG" from Extel, as well as "Tianma Award for Investor Relations Management of Chinese Listed Companies" from Securities Times and "China Pharmaceutical Emerging Innovation Power Award" from China Pharmaceutical Industry Information Center - In **May 2025**, awarded "**Asia's Best Company**" by FinanceAsia[119](index=119&type=chunk) - In **May 2025**, awarded a series of industry awards by Extel, including "**Most Honored Company**," "**Best Board of Directors**," "**Best CEO**," "**Best CFO**," and "**Best ESG**"[119](index=119&type=chunk)[122](index=122&type=chunk) - In **July 2025**, awarded "**China Pharmaceutical Emerging Innovation Power Award**" by China Pharmaceutical Industry Information Center[121](index=121&type=chunk) [Environmental, Social and Governance](index=33&type=section&id=Environmental%2C%20Social%20and%20Governance) The company has established a comprehensive three-tier ESG governance framework, with the Board of Directors serving as the highest body for responsibility and decision-making, guiding and supervising ESG development, and received the "Best ESG" award from Extel in May 2025 - A comprehensive three-tier ESG governance framework has been established, consisting of the **Board of Directors, ESG Working Group, and ESG Executive Body**[122](index=122&type=chunk) - The Board of Directors serves as the **highest body for ESG management and information disclosure**[122](index=122&type=chunk) [II. Financial Review](index=33&type=section&id=II.%20Financial%20Review) For the six months ended June 30, 2025, the company's revenue decreased by 31.3% to RMB 950.4 million, primarily due to reduced milestone payments from licensing and collaboration agreements, resulting in a loss of RMB 145.2 million for the period, while selling and distribution expenses significantly increased by 334.8% reflecting an expanded commercialization team and increased marketing activities, and the company maintained strong liquidity with a substantial increase in cash and financial assets, mainly driven by the H share placement - For the six months ended June 30, 2025, revenue was **RMB 950.4 million**, a **31.3% decrease** from the prior year[125](index=125&type=chunk) - Loss for the period was **RMB 145.2 million**, compared to a profit of **RMB 310.2 million** in the prior year[148](index=148&type=chunk) - Selling and distribution expenses increased by **334.8% to RMB 178.9 million**, primarily due to an expanded commercialization team and increased marketing activities[137](index=137&type=chunk) - Cash and cash equivalents increased to **RMB 3,102.8 million**, mainly reflecting the net proceeds from the placement in June 2025[150](index=150&type=chunk) [Revenue](index=33&type=section&id=Revenue) For the six months ended June 30, 2025, the company's revenue was RMB 950.4 million, a 31.3% year-on-year decrease, primarily due to reduced milestone payments from licensing and collaboration agreements, with drug sales contributing RMB 309.8 million Revenue Components (For the six months ended June 30) | Revenue Source | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue from licensing and collaboration agreements | 628,015 | 1,377,978 | | Revenue from providing R&D services | 12,674 | 4,813 | | Revenue from drug sales | 309,756 | – | | **Total** | **950,445** | **1,382,791** | - Revenue decreased by **31.3%**, primarily due to lower milestone payments from licensing and collaboration agreements compared to the first half of 2024[125](index=125&type=chunk) - In the first half of 2025, drug sales contributed **RMB 309.8 million** in revenue[125](index=125&type=chunk) [Cost of Sales](index=34&type=section&id=Cost%20of%20Sales) For the six months ended June 30, 2025, cost of sales was RMB 290.5 million, a 5.1% year-on-year decrease, primarily attributable to reduced employee costs for collaborative projects Cost of Sales Details (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee costs | 29,123 | 46,030 | | Trial and testing expenses | 227,006 | 225,976 | | Others | 34,328 | 34,095 | | **Total** | **290,457** | **306,101** | - Cost of sales decreased by **5.1%**, primarily attributable to reduced employee costs for collaborative projects in the first half of 2025[128](index=128&type=chunk) [Gross Profit and Gross Margin](index=34&type=section&id=Gross%20Profit%20and%20Gross%20Margin) For the six months ended June 30, 2025, gross profit was RMB 660.0 million, a 38.7% year-on-year decrease, with gross margin declining from 77.9% in the prior year to 69.4% Gross Profit and Gross Margin (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Gross Profit (RMB million) | 660.0 | 1,076.7 | | Gross Margin | 69.4% | 77.9% | - Gross profit decreased by **38.7%**, and gross margin decreased by **8.5 percentage points**[129](index=129&type=chunk) [Other Net Income](index=35&type=section&id=Other%20Net%20Income) For the six months ended June 30, 2025, other net income was RMB 31.8 million, a decrease of RMB 62.6 million from RMB 94.4 million in the prior year, primarily due to reduced government grants Other Net Income Details (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest income from bank deposits | 8,238 | 12,509 | | Interest income from financial assets measured at amortized cost | 4,464 | 5,155 | | Net realized and unrealized gains from financial assets measured at fair value through profit or loss | 13,028 | 7,265 | | Net foreign exchange (loss)/gain | (1,636) | 19,040 | | Government grants | 12,555 | 50,909 | | Net loss on disposal of property, plant and equipment | (33) | (46) | | Others | (4,829) | (437) | | **Total** | **31,787** | **94,395** | - Other net income decreased by **RMB 62.6 million**, primarily due to reduced government grants[131](index=131&type=chunk) [Administrative Expenses](index=35&type=section&id=Administrative%20Expenses) For the six months ended June 30, 2025, administrative expenses were RMB 73.8 million, a 12.2% year-on-year increase, primarily due to higher employee costs Administrative Expenses Details (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee costs | 60,799 | 50,638 | | Consulting service fees | 3,727 | 2,043 | | Office and travel expenses | 1,643 | 3,189 | | Others | 7,675 | 9,969 | | **Total** | **73,844** | **65,839** | - Administrative expenses increased by **12.2%**, primarily due to higher employee costs[134](index=134&type=chunk) [Selling and Distribution Expenses](index=36&type=section&id=Selling%20and%20Distribution%20Expenses) For the six months ended June 30, 2025, selling and distribution expenses were RMB 178.9 million, a significant 334.8% year-on-year increase, primarily due to the expansion of the commercialization team and increased costs related to product marketing activities Selling and Distribution Expenses Details (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee costs | 94,753 | 33,797 | | Conference, marketing, administrative expenses and others | 84,172 | 7,354 | | **Total** | **178,925** | **41,151** | - Selling and distribution expenses increased by **334.8%**, primarily due to the continuous expansion of the commercialization team and increased costs and expenses related to product marketing activities[137](index=137&type=chunk) [Research and Development Expenses](index=36&type=section&id=Research%20and%20Development%20Expenses) For the six months ended June 30, 2025, R&D expenses were RMB 611.5 million, a 6.3% year-on-year decrease, primarily due to reduced raw material usage R&D Expenses Details (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee costs | 201,672 | 200,857 | | Trial and testing expenses | 289,511 | 298,119 | | Raw materials | 53,298 | 85,278 | | Others | 67,058 | 68,083 | | **Total** | **611,539** | **652,337** | - R&D expenses decreased by **6.3%**, primarily due to reduced raw material usage[142](index=142&type=chunk) [Finance Costs](index=37&type=section&id=Finance%20Costs) For the six months ended June 30, 2025, finance costs were RMB 3.0 million, a 20.5% year-on-year increase, primarily attributable to higher interest expenses on lease liabilities Finance Costs Details (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest expense on lease liabilities | 3,022 | 1,140 | | Interest expense on bills payable | – | 1,367 | | **Total** | **3,022** | **2,507** | - Finance costs increased by **20.5%**, primarily attributable to higher interest expenses on lease liabilities[143](index=143&type=chunk) [Income Tax](index=37&type=section&id=Income%20Tax) For the six months ended June 30, 2025, the company recorded an income tax refund of RMB 30.4 million, compared to an income tax expense of RMB 99.0 million in the prior year, primarily benefiting from a USD 6.5 million withholding tax refund from the US IRS Income Tax (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current tax | | | | －China corporate income tax | – | – | | －Withholding tax | 16,335 | 99,025 | | －Withholding tax refund | (46,715) | – | | **Total** | **(30,380)** | **99,025** | - The company recorded an income tax refund of **RMB 30.4 million** in 2025, compared to an income tax expense of **RMB 99.0 million** in 2024[144](index=144&type=chunk) - In 2025, the US IRS refunded withholding tax of **USD 6.5 million** (equivalent to RMB 46,715 thousand)[146](index=146&type=chunk) [Profit/(Loss) for the Period](index=38&type=section&id=Profit%2F%28Loss%29%20for%20the%20Period) For the six months ended June 30, 2025, the company recorded a loss of RMB 145.2 million, a 146.8% decrease from a profit of RMB 310.2 million in the prior year Profit/(Loss) for the Period (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Period Change | | :--- | :--- | :--- | :--- | | Profit/(Loss) for the Period | (145.2) | 310.2 | -146.8% | [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company completed an H share placement on June 12, 2025, raising net proceeds of approximately HKD 1,943.0 million, significantly increasing cash and cash equivalents to RMB 3,102.8 million, with net current assets also growing substantially by 64.1% to RMB 4,402.3 million - On **June 12, 2025**, completed the placement of **5,918,000 new H shares**, with net proceeds of approximately **HKD 1,943.0 million** (equivalent to RMB 1,777.4 million)[150](index=150&type=chunk) Cash and Financial Assets (Period-end) | Indicator | As of June 30, 2025 (RMB million) | As of December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Cash and cash equivalents | 3,102.8 | 1,336.5 | | Financial assets measured at fair value through profit or loss | 852.3 | 1,448.3 | | Financial assets measured at amortized cost | 488.3 | 284.0 | - Net current assets were **RMB 4,402.3 million**, an increase of **64.1%** compared to net current assets of RMB 2,683.0 million as of December 31, 2024, primarily due to the net proceeds from the placement[155](index=155&type=chunk) [Net Cash Used in Operating Activities](index=39&type=section&id=Net%20Cash%20Used%20in%20Operating%20Activities) For the six months ended June 30, 2025, net cash used in operating activities was RMB 373.2 million, a significant increase from RMB 68.9 million in the prior year, primarily due to reduced payments received from Merck under the collaboration in the first half of 2025 Net Cash Used in Operating Activities (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | Net cash used in operating activities | (373.2) | (68.9) | - The increase in cash used was primarily due to reduced payments received from Merck under the collaboration in the first half of 2025[153](index=153&type=chunk) [Employees and Remuneration Policy](index=40&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the company had 1,870 employees, with remuneration packages including salaries, bonuses, and equity incentives determined by qualifications, performance, and seniority, aimed at motivating employees and fostering long-term company growth - As of **June 30, 2025**, the company had a total of **1,870 employees**[162](index=162&type=chunk) - Employee remuneration packages include **salaries and bonuses**, and provide **equity incentives and promotion opportunities**[162](index=162&type=chunk) [III. Outlook](index=40&type=section&id=III.%20Outlook) The company will continue to deepen R&D innovation, focus on its strengths, strengthen external collaborations, and leverage big data and artificial intelligence to improve R&D success rates, with future development strategies including advancing a differentiated drug pipeline, innovating conjugate drug design, enhancing end-to-end R&D and commercialization capabilities, expanding global presence and deepening strategic partnerships, and optimizing operating systems, aiming to become a globally leading biopharmaceutical company - Continue to deepen R&D innovation reforms, focus on inherent strengths, strive to improve efficiency, and strengthen external collaborations[163](index=163&type=chunk) - Utilize big data and artificial intelligence applications to enhance research capabilities in biology/small molecules and translational medicine, thereby improving the success rate of innovative drug R&D[163](index=163&type=chunk) - Plans to implement five major development strategies: advancing a differentiated drug pipeline, innovating conjugate drug design, enhancing end-to-end R&D and commercialization capabilities, expanding global presence and deepening strategic partnerships, and optimizing operating systems[163](index=163&type=chunk) [Advance an Indication-Oriented Differentiated Drug Pipeline Addressing Significant Medical Needs](index=40&type=section&id=Advance%20an%20Indication-Oriented%20Differentiated%20Drug%20Pipeline%20Addressing%20Significant%20Medical%20Needs) The company plans to advance a pipeline of over 10 clinical-stage drug candidates in the second half of 2025, accelerate clinical development, continue to strengthen its ADC and novel conjugate drug pipeline, and promote joint management with partners to target high-prevalence and unmet medical need cancer indications and non-oncology diseases - Key objective for the **second half of 2025** is to advance a pipeline of **over 10 clinical-stage drug candidates** and accelerate the clinical development process[164](index=164&type=chunk) - Continue to strengthen the ADC and novel conjugate drug pipeline, promote joint management of collaborative projects with partners, and secure further milestone payments[164](index=164&type=chunk) [Innovate and Optimize Payload-Linker Strategies, Novel Conjugate Drug Design and Structures, and Expand Applications in Non-Oncology Diseases](index=41&type=section&id=Innovate%20and%20Optimize%20Payload-Linker%20Strategies%2C%20Novel%20Conjugate%20Drug%20Design%20and%20Structures%2C%20and%20Expand%20Applications%20in%20Non-Oncology%20Diseases) The company will further expand its OptiDC™ portfolio through a multi-pronged strategy, including developing ADCs for new targets and target combinations, expanding payloads beyond common cytotoxic molecules, optimizing conjugation technologies for precise DAR control, exploring novel conjugate drugs like RDC, iADC, DAC, and applying ADCs to non-oncology diseases - Develop ADCs targeting new targets and target combinations, including **bispecific antibodies (bsAb) and TAA-IO bsAbs**[170](index=170&type=chunk) - Expand payloads beyond common cytotoxic molecules and develop **DNA damaging agents and other novel cytotoxic molecules and their combinations (dual-payload ADCs)**[170](index=170&type=chunk) - Optimize conjugation technologies to achieve precise control over payload conjugation sites and numbers, and develop **site-specific conjugation technologies**[170](index=170&type=chunk) - Develop novel conjugate drugs with multiple mechanisms of action beyond cytotoxic mechanisms, such as **RDC, iADC, and DAC**[168](index=168&type=chunk) - Develop ADCs equipped with various novel non-cytotoxic payloads for the treatment of non-oncology diseases, such as **autoimmune diseases**[169](index=169&type=chunk) [Enhance End-to-End Drug R&D and Commercialization Capabilities](index=42&type=section&id=Enhance%20End-to-End%20Drug%20R%26D%20and%20Commercialization%20Capabilities) The company will strengthen R&D capabilities by recruiting experienced professionals and integrating AI into R&D processes, while continuously expanding cGMP manufacturing facilities through internal capacity expansion or collaboration with reputable contract manufacturers, and upgrading its quality management system, and in commercialization, will refine commercialization strategies for late-stage drug candidates, prioritize medical needs in the Chinese market, and create synergistic licensing and collaboration opportunities globally - Continue to enhance R&D capabilities by recruiting experienced professionals from around the world and plan to continue introducing AI into multiple R&D processes[171](index=171&type=chunk) - Continuously expand cGMP manufacturing facilities and continuously enhance manufacturing capabilities through expanding internal capacity or collaborating with reputable contract manufacturers in the industry[171](index=171&type=chunk) - Marketing approvals for sac-TMT (Aitaiwei®), tagolimab (Ketaiwei®), and cetuximab N01 (Daitaiwei®) have been obtained, and commercialization has commenced[172](index=172&type=chunk) - Expected to launch core product bodotuximab (Shutaiwei®) in the Chinese market and submit an NDA for A400 in the **second half of 2025**[172](index=172&type=chunk) [Expand Global Footprint and Deepen Strategic Partnerships to Fully Unlock the Value of Our Product Pipeline](index=42&type=section&id=Expand%20Global%20Footprint%20and%20Deepen%20Strategic%20Partnerships%20to%20Fully%20Unlock%20the%20Value%20of%20Our%20Product%20Pipeline) The company will continue to adopt an out-licensing collaboration model, leveraging partners' global clinical development and commercialization capabilities to bring products to global markets, and in the long term, will learn from global experience, explore diversified "going global" pathways, gradually initiate international multi-center registration clinical studies and establish commercialization systems, while actively seeking opportunities to introduce new drug candidates and innovative technologies, and strengthening collaborations with domestic and international key opinion leaders, top hospitals, and academic institutions - Plans to continue adopting an out-licensing collaboration model, fully leveraging partners' global clinical development and commercialization capabilities to bring products to global markets[173](index=173&type=chunk) - In the long term, will explore diversified "going global" pathways, gradually initiate and promote international multi-center registration clinical studies, and establish commercialization systems[173](index=173&type=chunk) - Closely monitor global opportunities to license in new drug candidates and innovative technologies that can form strategic synergies with the pipeline and technology platforms[175](index=175&type=chunk) [Optimize Operating System to Become a Globally Leading Biopharmaceutical Company](index=43&type=section&id=Optimize%20Operating%20System%20to%20Become%20a%20Globally%20Leading%20Biopharmaceutical%20Company) The company will continuously review and optimize internal procedures, especially R&D management processes, to improve operational efficiency, while planning to attract and recruit outstanding scientific, marketing, and management personnel, and actively seeking opportunities to expand its global presence and enhance international brand awareness, committed to addressing significant unmet medical needs domestically and internationally - Continuously review and optimize internal procedures, especially R&D management processes, to improve operational efficiency[176](index=176&type=chunk) - Plans to attract and recruit outstanding scientific, marketing, and management personnel to its talent pool[176](index=176&type=chunk) - Actively seek opportunities to expand its global presence and enhance international brand awareness[176](index=176&type=chunk) Corporate Governance and Other Information This section details the company's corporate governance practices, securities transactions, post-reporting period events, interim results review, dividend policy, changes in key personnel, and interests of directors, chief executives, and major shareholders [Purchase, Sale or Redemption of the Company's Listed Securities](index=44&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%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 - For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[177](index=177&type=chunk) - As of **June 30, 2025**, the company held no treasury shares[178](index=178&type=chunk) [Corporate Governance](index=44&type=section&id=Corporate%20Governance) The company has adopted the Corporate Governance Code set out in Appendix C1 of the Listing Rules as its corporate governance practice code and strictly complied with it during the reporting period - The company has adopted corporate governance practices in accordance with the principles and code provisions set out in the **Corporate Governance Code** contained in Appendix C1 of the Listing Rules[179](index=179&type=chunk) - For the six months ended June 30, 2025, the company has strictly complied with the Corporate Governance Code[180](index=180&type=chunk) [Standard Code for Securities Transactions](index=44&type=section&id=Standard%20Code%20for%20Securities%20Transactions) The company has adopted the Model Code set out in Appendix C3 of the Listing Rules as the code of conduct for directors, supervisors, and employees dealing in the company's securities, and all directors and supervisors confirmed compliance with the code during the reporting period - The company has adopted the **Model Code** set out in Appendix C3 of the Listing Rules as the code of conduct for directors, supervisors, and employees of the Group dealing in the company's securities[182](index=182&type=chunk) - All directors and supervisors confirmed that they have complied with the Model Code during the six months ended June 30, 2025[182](index=182&type=chunk) [Post-Reporting Period Events](index=44&type=section&id=Post-Reporting%20Period%20Events) After the reporting period, Phase 2 clinical data for sac-TMT combined with PD-L1 mAb tagolimab for first-line treatment of advanced or metastatic NSCLC was published in Nature Medicine, and the company was selected for Fortune magazine's "2025 Fortune China Tech 50" in August 2025 - On **August 19, 2025**, Phase 2 clinical data for sac-TMT combined with PD-L1 mAb tagolimab for first-line treatment of advanced or metastatic NSCLC was published in **Nature Medicine**[184](index=184&type=chunk) - The company was selected for **Fortune magazine's "2025 Fortune China Tech 50"** on **August 21, 2025**[184](index=184&type=chunk) [Review of Interim Results](index=45&type=section&id=Review%20of%20Interim%20Results) The Audit Committee has reviewed the unaudited interim condensed consolidated financial information for the six months ended June 30, 2025, with management and the auditor, deeming it compliant with applicable accounting standards and legal regulations, and KPMG, the independent auditor, has reviewed the interim financial information in accordance with Hong Kong Standard on Review Engagements 2410 - The Audit Committee has reviewed the Group's unaudited interim condensed consolidated financial information for the six months ended June 30, 2025, with the company's management and auditor[185](index=185&type=chunk) - The Audit Committee believes that the interim results comply with applicable accounting standards and legal regulations, and appropriate disclosures have been made by the company[185](index=185&type=chunk) - KPMG, the independent auditor, has reviewed the interim financial information in accordance with **Hong Kong Standard on Review Engagements 2410**[185](index=185&type=chunk) [Interim Dividend](index=45&type=section&id=Interim%20Dividend) The Board of Directors does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board of Directors does not recommend the payment of any interim dividend for the six months ended June 30, 2025[186](index=186&type=chunk) [Changes in Information of Directors, Supervisors and Chief Executive](index=45&type=section&id=Changes%20in%20Information%20of%20Directors%2C%20Supervisors%20and%20Chief%20Executive) Since the publication of the 2024 Annual Report, the company's Supervisory Committee was abolished on June 20, 2025, with former supervisors ceasing their roles, Dr. Ge Junyou was elected as an employee representative director, Ms. Liao Yihong was appointed as a non-executive director, and some directors' committee roles also changed - The company has abolished the Supervisory Committee as of **June 20, 2025**, and former supervisors Ms. Liao Yihong, Dr. Song Hongmei, Ms. Yang Qiuyan, and Dr. Qing Yan no longer serve as supervisors[187](index=187&type=chunk) - Dr. Ge Junyou was elected as an employee representative director of the Fourth Board of Directors on **June 20, 2025**[187](index=187&type=chunk) - Ms. Liao Yihong was appointed as a non-executive director effective **June 20, 2025**[187](index=187&type=chunk) - Dr. Zheng Qiang was appointed as a member of the Audit Committee and ceased to be a member of the Nomination Committee effective **June 20, 2025**[191](index=191&type=chunk) [Interests and Short Positions of Directors and Chief Executive in the Shares, Underlying Shares and Debentures of the Company and its Associated Corporations](index=46&type=section&id=Interests%20and%20Short%20Positions%20of%20Directors%20and%20Chief%20Executive%20in%20the%20Shares%2C%20Underlying%20Shares%20and%20Debentures%20of%20the%20Company%20and%20its%20Associated%20Corporations) As of June 30, 2025, several directors and the chief executive held interests in the company's shares or its associated corporations, with Mr. Liu Gexin, as the ultimate controlling shareholder of Kelun Pharmaceutical, holding significant interests in the company's H shares and unlisted shares, and Dr. Ge Junyou, Mr. Lai Degui, Mr. Feng Hao, and Ms. Liao Yihong holding interests in the company's H shares through employee incentive platforms Interests of Directors or Chief Executive in the Company's Shares (As of June 30, 2025) | Name of Director or Chief Executive | Position | Nature of Interest | Number and Class of Shares Held | Approximate Percentage of Shareholding in Relevant Class (%) | Approximate Percentage of Total Issued Shares (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Liu Gexin | Chairman and Non-executive Director | Interest in controlled corporation | 92,345,543 H shares (L) | 56.73 | 39.60 | | | | Interest in controlled corporation | 62,201,712 unlisted shares (L) | 88.33 | 26.67 | | Ge Junyou | Executive Director, General Manager and CEO | Other | 2,250,000 H shares (L) | 1.38 | 0.96 | | Lai Degui | Non-executive Director | Other | 465,000 H shares (L) | 0.29 | 0.20 | | Feng Hao | Non-executive Director | Other | 465,000 H shares (L) | 0.29 | 0.20 | | Liao Yihong | Non-executive Director | Other | 170,000 H shares (L) | 0.10 | 0.07 | Interests of Directors or Chief Executive in Shares of Associated Corporations (As of June 30, 2025) | Name of Associated Corporation | Name of Director or Chief Executive | Position | Nature of Interest | Number of Shares in Associated Corporation Held | Approximate Percentage of Total Issued Shares of Associated Corporation (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Kelun Pharmaceutical | Liu Gexin | Chairman and Non-executive Director | Beneficial owner | 379,128,280 (L) | 23.72 | | | Ge Junyou | Executive Director and General Manager | Beneficial owner | 295,000 (L) | 0.02 | | Zhejiang Keyun | Lai Degui | Non-executive Director | Beneficial owner | 2,000,000 (L) | 10.00 | | | | Interest in controlled corporation | 3,200,000 (L) | 16.00 | | | Feng Hao | Non-executive Director | Beneficial owner | 2,000,000 (L) | 10.00 | | | | Interest in controlled corporation | 3,200,000 (L) | 16.00 | [Interests and Short Positions of Substantial Shareholders in the Shares and Underlying Shares of the Company](index=49&type=section&id=Interests%20and%20Short%20Positions%20of%20Substantial%20Shareholders%20in%20the%20Shares%20and%20Underlying%20Shares%20of%20the%20Company) As of June 30, 2025, Kelun Pharmaceutical was a substantial shareholder of the company, holding significant interests in the company's H shares and unlisted shares directly and through controlled corporations, Kelun Jingchuan, as the general partner of an employee incentive platform, held a portion of H shares, and Merck & Co., Inc. and its subsidiary Merck Sharp & Dohme LLC also held interests in the company's H shares Interests of Substantial Shareholders in the Company's Shares and Underlying Shares (As of June 30, 2025) | Name of Shareholder | Nature of Interest | Number and Class of Shares Held | Approximate Percentage of Shareholding in Relevant Class (%) | Approximate Percentage of Total Issued Shares (%) | | :--- | :--- | :--- | :--- | :--- | | Kelun Pharmaceutical | Beneficial owner | 57,777,843 H shares (L) | 35.50 | 24.78 | | | Interest in controlled corporation | 34,567,700 H shares (L) | 21.24 | 14.82 | | | Beneficial owner | 62,201,712 unlisted shares (L) | 88.33 | 26.67 | | Kelun Jingchuan | Interest in controlled corporation | 30,000,000 H shares (L) | 18.43 | 12.87 | | Merck & Co., Inc. | Interest in controlled corporation | 13,443,693 H shares (L) | 8.26 | 5.77 | | Merck Sharp & Dohme LLC | Beneficial owner | 13,443,693 H shares (L) | 8.26 | 5.77 | [Pre-IPO Employee Incentive Scheme](index=50&type=section&id=Pre-IPO%20Employee%20Incentive%20Scheme) The company's Pre-IPO Employee Incentive Scheme, adopted in 2016 and subsequently amended, aims to attract and retain core talent through equity incentives, implemented via four limited partnership employee incentive platforms holding a total of 30,000,000 company shares, with 22,976,250 share awards granted to participants as of June 30, 2025 - The Pre-IPO Employee Incentive Scheme was adopted and approved by written resolution of the Board in **2016**, and further amended in **May 2020 and January 2023**[205](index=205&type=chunk) - The scheme aims to provide equity incentives to core employees to attract and retain skilled talent and fully motivate them[207](index=207&type=chunk) - Four employee incentive platforms (in the form of limited partnerships) have been established, holding a total of **30,000,000 shares**[205](index=205&type=chunk) - As of **June 30, 2025**, a total of **22,976,250 share awards** (approximately **76.59%** of the total shares under the Pre-IPO Employee Incentive Scheme) have been granted to participants[219](index=219&type=chunk) [Use of Net Proceeds from Global Offering and Over-allotment Option](index=55&type=section&id=Use%20of%20Net%20Proceeds%20from%20Global%20Offering%20and%20Over-allotment%20Option) The total net proceeds from the company's global offering and full exercise of the over-allotment option amounted to approximately HKD 1,454.9 million, with most funds utilized as disclosed in the prospectus by the end of the reporting period, primarily for R&D and commercialization of core and other key products, technology platform development, capacity expansion, and working capital - The total net proceeds from the global offering and full exercise of the over-allotment option amounted to approximately **HKD 1,454.9 million**[221](index=221&type=chunk) Use of Net Proceeds from Global Offering and Over-allotment Option (As of the end of the reporting period) | Intended Use | Allocation of Net Proceeds (RMB million) | Percentage of Net Proceeds | Net Proceeds Utilized (RMB million) | Net Proceeds Unutilized (RMB million) | | :--- | :--- | :--- | :--- | :--- | | Research, R&D and commercialization of core products SKB264 and A166 | 600.9 | 45% | 600.9 | 0 | | R&D and commercialization of other key products (A140, A167, A400 and A223) | 400.6 | 30% | 400.6 | 0 | | Continuous development of technology platforms, advancement of other existing pipeline assets, and exploration and development of new drug candidates | 160.2 | 12% | 139.5 | 20.7 | | Expansion of production capacity and quality control systems to support the expected commercialization of late-stage assets | 106.8 | 8% | 100.9 | 5.9 | | Working capital and general corporate purposes | 66.9 | 5% | 66.9 | 0 | | **Total** | **1,335.4** | **100%** | **1,308.8** | **26.6** | [Use of Net Proceeds from May 2024 Placement](index=57&type=section&id=Use%20of%20Net%20Proceeds%20from%20May%202024%20Placement) The company completed the placement of 3,648,600 H shares in May 2024, raising net proceeds of approximately HKD 541.4 million, with most funds utilized by the end of the reporting period for R&D, clinical trials, registration filings, manufacturing, and commercialization of core and other products, as well as enhancing internal R&D technical capabilities - Net proceeds from the May 2024 placement amounted to approximately **HKD 541.4 million**[224](index=224&type=chunk) Use of Net Proceeds from May 2024 Placement (As of the end of the reporting period) | Intended Use | Allocation of Net Proceeds (RMB million) | Percentage of Total Net Proceeds | Net Proceeds Utilized (RMB million) | Net Proceeds Unutilized (RMB million) | | :--- | :--- | :--- | :--- | :--- | | R&D, clinical trials, registration filings, manufacturing and commercialization: core products | 172.1 | 35% | 172.1 | 0 | | R&D, clinical trials, registration filings, manufacturing and commercialization: other products | 172.1 | 35% | 171.4 | 0.7 | | Enhancement of internal R&D technical capabilities, strengthening external collaborations, and expanding product pipeline portfolio | 122.9 | 25% | 61.3 | 61.6 | | Working capital and general corporate purposes | 24.5 | 5% | 23.9 | 0.6 | | **Total** | **491.6** | **100%** | **428.7** | **62.9** | [Use of Net Proceeds from Subscription](index=58&type=section&id=Use%20of%20Net%20Proceeds%20from%20Subscription) The company completed the subscription of 4,423,870 domestic shares by Kelun Pharmaceutical in December 2024, raising net proceeds of approximately RMB 601.4 million, with most funds utilized by the end of the reporting period for R&D, clinical trials, registration filings, manufacturing, and commercialization of core and other products, as well as enhancing internal R&D technical capabilities - Net proceeds from the subscription amounted to approximately **RMB 601.4 million**[227](index=227&type=chunk) Use of Net Proceeds from Subscription (As of the end of the reporting period) | Intended Use | Allocation of Net Proceeds (RMB million) | Percentage of Total Net Proceeds | Net Proceeds Utilized (RMB million) | Net Proceeds Unutilized (RMB million) | | :--- | :--- | :--- | :--- | :--- | | R&D, clinical trials, registration filings, manufacturing and commercialization: core products | 210.5 | 35% | 209.2 | 1.3 | | R&D, clinical trials, registration filings, manufacturing and commercialization: other products | 210.5 | 35% | 118.7 | 91.8 | | Enhancement of internal R&D technical capabilities, strengthening external collaborations, and expanding product pipeline portfolio | 150.3 | 25% | 66.6 | 83.7 | | Working capital and general corporate purposes | 30.1 | 5% | 30.1 | 0 | | **Total** | **601.4** | **100%** | **424.6** | **176.8** | [Use of Net Proceeds from June 2025 Placement](index=59&type=section&id=Use%20of%20Net%20Proceeds%20from%20June%202025%20Placement) The company completed the placement of 5,918,000 H shares in June 2025, raising net proceeds of approximately HKD 1,943.0 million, which remained unutilized by the end of the reporting period, primarily planned for product R&D, clinical trials, registration filings, manufacturing, and commercialization, enhancing internal R&D technical capabilities, and working capital - Net proceeds from the June 2025 placement amounted to approximately **HKD 1,943.0 million** (equivalent to RMB 1,777.4 million)[229](index=229&type=chunk) Use of Net Proceeds from June 2025 Placement (As of the end of the reporting period) | Intended Use | Allocation of Net Proceeds (RMB million) | Percentage of Total Net Proceeds | Net Proceeds Utilized (RMB million) | Net Proceeds Unutilized (RMB million) | | :--- | :--- | :--- | :--- | :--- | | R&D, clinical trials, registration filings, manufacturing and commercialization products | 1,421.9 | 80% | 0 | 1,421.9 | | Enhancement of internal R&D technical capabilities, strengthening external collaborations, and expanding product pipeline portfolio | 266.6 | 15% | 0 | 266.6 | | Working capital and general corporate purposes | 88.9 | 5% | 0 | 88.9 | | **Total** | **1,777.4** | **100%** | **0** | **1,777.4** | Interim Financial Information Review Report This section presents the independent auditor's review report on the company's interim financial information, including the basis of preparation, scope of review, and conclusion [Introduction](index=59&type=section&id=Introduction) KPMG has reviewed the company's interim financial report for the six months ended June 30, 2025, prepared in accordance with the Listing Rules and International Accounting Standard 34, with the Board of Directors responsible for its preparation and presentation - KPMG has reviewed the company's interim financial report for the six months ended June 30, 2025[232](index=232&type=chunk) - The interim financial report was prepared in accordance with the **Listing Rules** and **International Accounting Standard 34 "Interim Financial Reporting"**[232](index=232&type=chunk) [Scope of Review](index=60&type=section&id=Scope%20of%20Review) The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants, with a scope smaller than an audit, thus no audit opinion is expressed - The review was conducted 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[233](index=233&type=chunk) - The scope of review is substantially less than an audit, and therefore no audit opinion is expressed[233](index=233&type=chunk) [Conclusion](index=60&type=section&id=Conclusion) Based on the review, no matters were identified that indicate the interim financial report as of June 30, 2025, was not prepared in all material respects in accordance with International Accounting Standard 34 - No matters were identified that lead us to believe that the interim financial report as of **June 30, 2025**, was not prepared in all material respects in accordance with **International Accounting Standard 34 "Interim Financial Reporting"**[234](index=234&type=chunk) Consolidated Statement of Profit or Loss This section presents the company's consolidated statement of profit or loss, detailing revenue, cost of sales, gross profit, expenses, and net profit or loss for the reporting period [Summary of Consolidated Statement of Profit or Loss](index=61&type=section&id=Summary%20of%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2025, the company's revenue was RMB 950.4 million, with a gross profit of RMB 660.0 million, and due to higher R&D, selling, and distribution expenses, as well as changes in other net income and income tax, the company recorded a loss of RMB 145.2 million for the period, with basic and diluted loss per share of RMB 0.64 Summary of Consolidated Statement of Profit or Loss (For the six months ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 950,445 | 1,382,791 | | Cost of sales | (290,457) | (306,101) | | Gross profit | 659,988 | 1,076,690 | | Other net income | 31,787 | 94,395 | | Administrative expenses | (73,844) | (65,839) | | Selling and distribution expenses | (178,925) | (41,151) | | R&D expenses | (611,539) | (652,337) | | Operating (loss)/profit | (172,533) | 411,758 | | Finance costs | (3,022) | (2,507) | | (Loss)/Profit before tax | (175,555) | 409,251 | | Income tax | 30,380 | (99,025) | | (Loss)/Profit for the period attributable to equity holders of the company | (145,175) | 310,226 | | Basic and diluted (loss)/earnings per share (RMB) | (0.64) | 1.41 | Consolidated Statement of Profit or Loss and Other Comprehensive Income This section presents the company's consolidated statement of profit or loss and other comprehensive income, showing the total comprehensive income or loss for the reporting period [Summary of Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=62&type=section&id=Summary%20of%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the company recorded a loss of RMB 145.2 million for the period, with other comprehensive income (after tax) showing a loss of RMB 2.4 million due to exchange differences, resulting in a total comprehensive loss of RMB 147.6 million for the period Summary of Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | (Loss)/Profit for the period | (145,175) | 310,226 | | Other comprehensive income for the period (after tax): | | | | Exchange differences on translation of financial statements of foreign operations | (2,407) | 1,337 | | Other comprehensive income for the period | (2,407) | 1,337 | | Total comprehensive income for the period attributable to equity holders of the company | (147,582) | 311,563 | Consolidated Statement of Financial Position This section presents the company's consolidated statement of financial position, outlining its assets, liabilities, and equity as of the reporting date [Summary of Consolidated Statement of Financial Position](index=63&type=section&id=Summary%20of%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets less current liabilities were RMB 5,162.5 million, and total equity was RMB 5,014.3 million, representing significant growth from December 31, 2024, with net current assets increasing substantially by 64.1% to RMB 4,402.3 million, primarily driven by growth in cash and financial assets Summary of Consolidated Statement of Financial Position (As of June 30, 2025) | Indicator | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Non-current assets | 760,226 | 775,196 | | Current assets | 5,192,660 | 3,492,806 | | Current liabilities | 790,352 | 809,841 | | Net current assets | 4,402,308 | 2,682,965