[Important Notice](index=3&type=section&id=%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) The Board and senior management affirm the interim report's accuracy, noting its approval, KPMG's review, and no interim profit distribution - The Board of Directors, Board of Supervisors, and senior management guarantee the truthfulness, accuracy, and completeness of this interim report, free from false records, misleading statements, or material omissions[5](index=5&type=chunk) - On August 28, 2025, the Bank's Fifth Board of Directors' Twelfth Meeting approved the "Proposal on Approving the 2025 Interim Report of Dongguan Rural Commercial Bank Co., Ltd."[5](index=5&type=chunk) - The Bank's 2025 interim financial report, prepared in accordance with International Financial Reporting Standards, is unaudited but has been reviewed by KPMG in accordance with International Standards on Review Engagements[5](index=5&type=chunk) - The Bank will not distribute profits or convert capital reserves into share capital for the 2025 interim period[5](index=5&type=chunk) [Definitions](index=5&type=section&id=%E9%87%8B%E7%BE%A9) This section defines key terms used throughout the report to ensure clarity and consistent understanding of the content - This section provides definitions for commonly used terms in the report, such as "the Bank," "the Group," "Board of Directors," "Board of Supervisors," "CBIRC," "non-performing loans," "Sannong," and "small and micro enterprises," to ensure clarity and consistency of the report content[11](index=11&type=chunk)[12](index=12&type=chunk)[13](index=13&type=chunk) [Chapter 1 Introduction and Business Overview](index=9&type=section&id=%E7%AC%AC%E4%B8%80%E7%AB%A0%20%E7%B0%A1%E4%BB%8B%E5%92%8C%E6%A5%AD%E5%8B%99%E6%A6%82%E8%A6%81) This chapter provides an overview of the Bank's fundamental information, corporate profile, investment value, core competitiveness, and recent awards [Basic Information](index=10&type=section&id=%E4%B8%80%E3%80%81%E5%9F%BA%E6%9C%AC%E4%BF%A1%E6%81%AF) This section lists the basic information of Dongguan Rural Commercial Bank Co., Ltd., including its legal name, abbreviation, legal representative, registered address, website, customer service hotline, principal place of business in Hong Kong, stock exchange and code, and registered capital - The company's legal Chinese name is Dongguan Rural Commercial Bank Co., Ltd., abbreviated as Dongguan Rural Commercial Bank[17](index=17&type=chunk) - The company was listed on the Hong Kong Stock Exchange in 2021, with stock code 9889.HK[17](index=17&type=chunk)[18](index=18&type=chunk) Overview of Basic Information | Indicator | Content | | :--- | :--- | | Registered Address | No. 2 Hongfu East Road, Dongcheng Street, Dongguan City, Guangdong Province, China | | Registered Capital | RMB 6,888,545,510 | | Stock Exchange | The Stock Exchange of Hong Kong Limited | | Stock Abbreviation and Code | Dongguan Rural Commercial Bank (9889.HK) | [Company Profile](index=11&type=section&id=%E4%BA%8C%E3%80%81%E5%85%AC%E5%8F%B8%E6%83%85%E5%86%B5) Dongguan Rural Commercial Bank originated in 1952, was restructured into a joint-stock bank in 2009, and listed in Hong Kong in 2021. As of June 30, 2025, the Group's total assets reached RMB 760.45 billion, total deposits RMB 532.36 billion, and total loans RMB 394.42 billion. The non-performing loan ratio was 1.87%, and the provision coverage ratio was 190.56% - Dongguan Rural Commercial Bank has a long history, originating in 1952, restructured into a joint-stock bank in 2009, and listed on the Hong Kong Stock Exchange in 2021[18](index=18&type=chunk) - As of June 30, 2025, the Group's total assets were **RMB 760.45 billion**, total deposits **RMB 532.36 billion**, and total loans **RMB 394.42 billion**[18](index=18&type=chunk) Key Financial Indicators of the Group as of June 30, 2025 | Indicator | Amount/Ratio | | :--- | :--- | | Total Assets | RMB 760.45 billion | | Total Deposits | RMB 532.36 billion | | Total Loans | RMB 394.42 billion | | Non-performing Loan Ratio | 1.87% | | Provision Coverage Ratio | 190.56% | | Capital Adequacy Ratio | 15.92% | | Tier 1 Capital Adequacy Ratio | 13.80% | - According to the latest statistics from The Banker magazine, Dongguan Rural Commercial Bank ranked **218th** globally by Tier 1 capital as of the end of 2024[19](index=19&type=chunk) [Investment Value and Core Competitiveness](index=12&type=section&id=%E4%B8%89%E3%80%81%E6%8A%95%E8%B3%87%E5%83%B9%E5%80%BC%E5%8F%8A%E6%A0%B8%E5%BF%83%E7%AB%B6%E7%88%AD%E5%8A%9B) The Group's core competitiveness lies in its vibrant operating regional economy, clear development strategy, synergistic business segments, refined organizational management, technological empowerment, sound corporate governance, and open and enterprising corporate culture - The Group is based in the Guangdong-Hong Kong-Macao Greater Bay Area, centered in Dongguan with eastern and western Guangdong as fulcrums, operating in a vibrant regional economy with broad market development space[20](index=20&type=chunk) - The development strategy is clear and firm, aiming to become a regional value rural commercial bank group, practicing customer-oriented, integrity, steady development, and synergistic growth values[20](index=20&type=chunk) - The Group adheres to its primary responsibility of supporting agriculture, small businesses, and the real economy, promoting synergistic development of its four core business segments: corporate, retail, inclusive finance, and financial asset management, while accelerating digital transformation through technological empowerment[20](index=20&type=chunk)[21](index=21&type=chunk) - A sound "three boards and one layer" governance structure is established, with a diversified shareholder structure, fostering a corporate culture of responsibility, prudence, stability, warmth, and harmony[21](index=21&type=chunk) [Honors and Awards](index=13&type=section&id=%E5%9B%9B%E3%80%81%E6%A6%AE%E8%AD%BD%E8%88%87%E7%8D%8E%E9%A0%85) The Group received multiple honors and awards in 2025, including the Dongguan City Efficiency Contribution Award, Top 20 Enterprises by Main Business Revenue, Integrity Enterprise, and outstanding collective in promoting the "Hundred Counties, Thousand Towns, Ten Thousand Villages High-Quality Development Project," ranking 218th in The Banker magazine's Top 1,000 World Banks - In March 2025, the Group received the "2024 Dongguan City Efficiency Contribution Award" and "2024 Top 20 Enterprises by Main Business Revenue in Dongguan City" from the Dongguan Municipal Committee of the Communist Party of China and the Dongguan Municipal People's Government[22](index=22&type=chunk) - In May 2025, the Group was commended by the General Office of the CPC Guangdong Provincial Committee and the General Office of the Guangdong Provincial People's Government for its outstanding performance in promoting the "Hundred Counties, Thousand Towns, Ten Thousand Villages High-Quality Development Project"[22](index=22&type=chunk) - In July 2025, the Group ranked **218th** in The Banker magazine's "Top 1,000 World Banks"[22](index=22&type=chunk) [Chapter 2 Summary of Accounting Data and Financial Indicators](index=14&type=section&id=%E7%AC%AC%E4%BA%8C%E7%AB%A0%20%E6%9C%83%E8%A8%88%E6%95%B8%E6%93%9A%E5%92%8C%E8%B2%A1%E5%8B%99%E6%8C%87%E6%A8%99%E6%91%98%E8%A6%81) This chapter summarizes Dongguan Rural Commercial Bank's key accounting data and financial indicators for the six months ended June 30, 2025. During the reporting period, operating income and net profit decreased year-on-year, but total assets and customer loan balances grew steadily. Asset quality indicators showed a slight increase in the non-performing loan ratio and a decrease in the provision coverage ratio, while capital adequacy ratios remained compliant with regulatory requirements Summary of Operating Results for H1 2025 | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change from prior period (%) | | :--- | :--- | :--- | :--- | | Operating Income | 5,500,933 | 6,398,182 | (14.02) | | Profit Before Tax | 2,755,043 | 3,457,440 | (20.32) | | Net Profit | 2,627,906 | 3,378,731 | (22.22) | | Net Profit Attributable to Shareholders of the Bank | 2,628,882 | 3,169,894 | (17.07) | | Basic Earnings Per Share (RMB

[Executive Summary](index=3&type=section&id=%E6%91%98%E8%A6%81) H1 2025 sales grew 12.5% and net profit 12.6%, benefiting from global supply chain shifts and improved gross margin Key Financial Performance H1 2025 (YoY) | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 9,018.3 | 8,017.8 | 12.5 | | Gross Profit | 2,960.2 | 2,591.6 | 14.2 | | Operating Profit | 1,983.5 | 1,750.8 | 13.3 | | Profit Attributable to Shareholders | 1,711.5 | 1,520.6 | 12.6 | | Basic Earnings Per Share (RMB) | 1.07 | 0.95 | 12.6 | - Company sales revenue increased by **12.5% year-on-year**, benefiting from global supply chain restructuring and accelerated growth in downstream industries like new energy vehicles[9](index=9&type=chunk) - Gross profit margin increased to **32.8%** (H1 2024: 32.3%) due to relatively lower raw material prices during the reporting period[9](index=9&type=chunk) - Net cash generated from operating activities reached **RMB 1,402.4 million**, with a net cash position (including wealth management products) of **RMB 10,923 million**[9](index=9&type=chunk) - The Board resolved not to declare an interim dividend, with potential distribution to be considered after reviewing the full-year results[9](index=9&type=chunk) [Company Profile and Information](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E7%B0%A1%E4%BB%8B%E5%8F%8A%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section details the company's governance structure, including board members and committees, along with its registered offices and key banking relationships - The company's Board of Directors includes executive directors such as **Mr. Zhang Jianming (Chairman)** and **Mr. Zhang Bin (CEO)**, as well as non-executive and independent non-executive directors[10](index=10&type=chunk) - The company has established an Audit Committee, Nomination Committee, and Remuneration Committee to enhance corporate governance[10](index=10&type=chunk) - The company's registered office is in the Cayman Islands, with principal places of business in mainland China and Hong Kong SAR[10](index=10&type=chunk) - Key banking relationships include Agricultural Bank of China, Bank of China, Hang Seng Bank, HSBC, and other domestic and international banks[11](index=11&type=chunk) [Investor Information](index=5&type=section&id=%E6%8A%95%E8%B3%87%E8%80%85%E8%B3%87%E6%96%99) This section provides key investor details, including stock listing, earnings per share, issued shares, market capitalization, and investor relations contacts - Company shares are listed on the Hong Kong Stock Exchange, with stock code **1882**[12](index=12&type=chunk) - Earnings per share for H1 2025 were **RMB 1.07**[13](index=13&type=chunk) - As of June 30, 2025, the number of issued shares was **1,596,000,000**, with a market capitalization of **HKD 32,558.4 million**[15](index=15&type=chunk) - The company provides investor relations contact phone numbers, fax, email, and addresses for mainland China and Hong Kong[14](index=14&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%E8%88%87%E5%88%86%E6%9E%90) [Business Review](index=6&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) H1 2025 sales grew 12.5% and net profit 12.6%, driven by global supply chain shifts and improved gross margin [Domestic and Overseas Sales](index=7&type=section&id=%E5%9C%8B%E5%85%A7%E5%8F%8A%E6%B5%B7%E5%A4%96%E9%8A%B7%E5%94%AE) The company's H1 2025 sales saw stable domestic performance and significant overseas growth, driven by global supply chain adjustments H1 2025 Sales by Region (RMB million) | Region | H1 2025 | Share (%) | H1 2024 | Share (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Domestic Sales | 5,200.6 | 57.7 | 5,182.5 | 64.6 | 0.3 | | Overseas Sales | 3,817.7 | 42.3 | 2,835.3 | 35.4 | 34.7 | | Total | 9,018.3 | 100 | 8,017.8 | 100 | 12.5 | - Domestic sales remained stable at **RMB 5,200.6 million**, achieved by expanding key clients and deepening market penetration[18](index=18&type=chunk) - Overseas sales significantly grew by **34.7%** to **RMB 3,817.7 million**, driven by global supply chain restructuring and the company's continuous overseas expansion, particularly in Southeast Asian markets[18](index=18&type=chunk) [Injection Molding Machine Sales by Product Series](index=7&type=section&id=%E4%BB%A5%E7%94%A2%E5%93%81%E7%B3%BB%E5%88%97%E5%8A%83%E5%88%86%E7%9A%84%E6%B3%A8%E5%A1%91%E6%A9%9F%E9%8A%B7%E5%94%AE%E6%AF%94%E4%BE%8B) Injection molding machine sales and component services both experienced double-digit growth in H1 2025, driven by strong demand in key sectors H1 2025 Sales by Product Series (RMB million) | Product Series | H1 2025 | Share (%) | H1 2024 | Share (%) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Injection Molding Machines | 8,636.9 | 95.8 | 7,702.5 | 96.1 | 12.1 | | Components and Services | 381.4 | 4.2 | 315.3 | 3.9 | 21.0 | | Total | 9,018.3 | 100 | 8,017.8 | 100 | 12.5 | - Injection molding machine sales increased by **12.1% year-on-year** to **RMB 8,636.9 million**, driven by demand from overseas daily consumer goods and domestic new energy vehicles and home appliance industries, with rapid growth in Mars and Jupiter series[21](index=21&type=chunk) - Component and service sales increased by **21.0% year-on-year** to **RMB 381.4 million**[21](index=21&type=chunk) [Outlook](index=8&type=section&id=%E5%B1%95%E6%9C%9B) The company anticipates a complex global economic environment in H2 2025 and plans to focus on technological innovation, global expansion, and localized supply chain development - H2 2025 is expected to see continued global economic divergence and weak recovery, intensified trade protectionism, and geopolitical conflicts, while the domestic economy faces pressure on both internal and external demand alongside structural transformation[22](index=22&type=chunk) - The company will remain customer-oriented, developing more energy-efficient, intelligent, and integrated new machine models through technological innovation, and providing customized solutions and value-added services[22](index=22&type=chunk) - The company will advance its "Five-Five" strategy, deepen global investment, increase investment in overseas local factories, strengthen local supply chain construction, and accelerate the construction of factories in Japan, Serbia, and Chennai, India, to navigate complex geopolitical situations[23](index=23&type=chunk) [Financial Review](index=9&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) In H1 2025, the company saw increased revenue and gross profit, alongside higher selling and administrative expenses, decreased net finance income, and increased income tax expense, while maintaining a robust financial position and managing foreign exchange risks [Revenue](index=9&type=section&id=%E6%94%B6%E5%85%A5) In H1 2025, the company's revenue increased by 12.5% year-on-year, driven by both domestic and overseas sales - For the six months ended June 30, 2025, the company's revenue reached **RMB 9,018.3 million**, an increase of **12.5%** compared to the same period in 2024[24](index=24&type=chunk) - Domestic sales amounted to **RMB 5,200.6 million**, and overseas sales were **RMB 3,817.7 million**[24](index=24&type=chunk) [Gross Profit](index=9&type=section&id=%E6%AF%9B%E5%88%A9) Gross profit increased by 14.2% in H1 2025, with the overall gross profit margin rising to 32.8% due to lower raw material prices - Gross profit for H1 2025 was approximately **RMB 2,960.2 million**, an increase of **14.2%** compared to H1 2024[25](index=25&type=chunk) - The overall gross profit margin increased to **32.8%** (H1 2024: 32.3%), primarily due to relatively lower raw material prices during the reporting period[25](index=25&type=chunk) [Selling and Administrative Expenses](index=9&type=section&id=%E9%8A%B7%E5%94%AE%E5%8F%8A%E8%A1%8C%E6%94%BF%E9%96%8B%E6%94%AF) Selling and administrative expenses increased by 17.0% in H1 2025, mainly due to higher sales commissions, R&D expenses, and labor costs - Selling and administrative expenses increased by **17.0%** from **RMB 1,142.3 million** in H1 2024 to **RMB 1,336.1 million** in H1 2025[26](index=26&type=chunk) - The increase was primarily due to higher sales commissions, research and development expenses, and labor costs, with R&D-related labor costs amounting to approximately **RMB 156.3 million** (H1 2024: RMB 134.5 million)[26](index=26&type=chunk) [Other Income](index=10&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5) Other income, primarily government subsidies, saw a slight 1% decrease in H1 2025 - Other income, mainly government subsidies, decreased by **1%** from **RMB 228.7 million** in H1 2024 to **RMB 227.3 million** in H1 2025[28](index=28&type=chunk) [Net Finance Income](index=10&type=section&id=%E8%9E%8D%E8%B3%87%E6%94%B6%E5%85%A5%E6%B7%A8%E9%A1%8D) Net finance income decreased in H1 2025 due to lower interest income, partially offset by reduced bank loan interest and a positive foreign exchange gain - Net finance income recorded **RMB 80.1 million** in H1 2025, a decrease from **RMB 98.9 million** in H1 2024[29](index=29&type=chunk) - The change was primarily due to a decrease in interest income (RMB 91.3 million vs RMB 136.2 million) and a reduction in bank loan interest and lease liability expenses (RMB 27.8 million vs RMB 35.6 million), as well as a positive net exchange gain (RMB 16.6 million vs loss of RMB 1.8 million)[29](index=29&type=chunk) [Income Tax Expense](index=10&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income tax expense increased by 10.9% in H1 2025, while the effective tax rate remained stable - Income tax expense increased by **10.9%** from **RMB 333.3 million** in H1 2024 to **RMB 369.5 million** in H1 2025[30](index=30&type=chunk) - The effective tax rate remained at a similar level of **17.7%** (H1 2024: 18.0%)[30](index=30&type=chunk) [Profit Attributable to Shareholders](index=10&type=section&id=%E8%82%A1%E6%9D%B1%E6%87%89%E4%BD%94%E7%B4%94%E5%88%A9) Profit attributable to shareholders increased by 12.6% in H1 2025, reaching RMB 1,711.5 million - Profit attributable to shareholders for the six months ended June 30, 2025, increased to **RMB 1,711.5 million**, a **12.6%** growth compared to H1 2024[31](index=31&type=chunk) [Liquidity, Financial Resources, Borrowings and Capital Gearing](index=10&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E3%80%81%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90%E3%80%81%E5%80%9F%E8%B2%B8%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B2%A0%E5%82%B5) The group maintains a robust financial position with substantial net cash and financial assets, despite a slight decrease in net cash position Liquidity and Financial Resources (RMB million) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and Cash Equivalents | 2,528.6 | 2,745.4 | | Time Deposits | 3,709.1 | 3,331.9 | | Restricted Cash | 46.8 | 52.8 | | Bank Borrowings | 2,340.5 | 2,011.3 | | Financial Assets at FVTPL | 6,979.3 | 6,971.5 | | Net Cash Position | 3,944.0 | 4,118.8 | - The Group's financial position remains robust, with a net cash position of **RMB 3,944.0 million**[33](index=33&type=chunk) - The floating annual interest rates for wealth management products ranged from **1.5% to 6.8%** (2024: 2.0% to 7.8%)[32](index=32&type=chunk) [Capital Expenditure](index=11&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF) Capital expenditure increased in H1 2025, primarily allocated to land use rights, property, plant, and equipment - Capital expenditure for H1 2025 reached **RMB 632.6 million** (H1 2024: RMB 583.8 million), mainly for land use rights, additions to property, plant, and equipment[35](index=35&type=chunk) [Pledged Group Assets](index=11&type=section&id=%E6%8A%B5%E6%8A%BC%E9%9B%86%E5%9C%98%E8%B3%87%E7%94%A2) As of June 30, 2025, certain time deposits, bills receivables, and property, plant, and equipment were pledged as collateral for payables and bank facilities - As of June 30, 2025, time deposits of **RMB 740.0 million** and bills receivables of **RMB 233.0 million** were pledged as collateral for bills payable and borrowings[36](index=36&type=chunk) - Property, plant, and equipment with a net book value of **RMB 60.9 million** belonging to subsidiary Haitian (Vietnam) Machinery Co Ltd were pledged as collateral for a bank comprehensive credit facility of **RMB 143.2 million**[36](index=36&type=chunk) [Foreign Exchange Risk Management](index=11&type=section&id=%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86) The Group's foreign exchange risk is limited as a significant portion of overseas sales are denominated in foreign currencies, while foreign currency procurement is minimal - During the reporting period, approximately **42.3%** of the Group's products were sold in overseas markets, with sales denominated in USD or other foreign currencies, while foreign currency procurement accounted for less than **10%** of total procurement[37](index=37&type=chunk) [Financial Guarantees](index=11&type=section&id=%E8%B2%A1%E5%8B%99%E6%93%94%E4%BF%9D) As of June 30, 2025, the Group provided financial guarantees to banks for credit facilities granted to customers, totaling RMB 418.0 million - As of June 30, 2025, the Group provided guarantees to banks for credit facilities granted to customers, totaling **RMB 418.0 million** (December 31, 2024: RMB 241.1 million)[38](index=38&type=chunk) [Contingent Liabilities](index=11&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities[39](index=39&type=chunk) [Employees](index=11&type=section&id=%E5%83%B1%E5%93%A1) As of June 30, 2025, the Group employed approximately 8,320 individuals, primarily in mainland China, offering competitive compensation and fostering a learning culture - As of June 30, 2025, the Group employed a total of approximately **8,320 employees**, with the majority located in mainland China[40](index=40&type=chunk) - The company offers competitive remuneration packages and discretionary bonuses, is committed to fostering a learning culture, and currently has no share option scheme in place[40](index=40&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company and its Associated Corporations](index=12&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%85%B6%E7%9B%B8%E8%81%AF%E6%B3%95%E5%9C%98%E4%B9%8B%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%82%B5%E6%AC%8A%E8%AD%89%E4%B9%8B%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) This section details the long positions held by directors in the company's shares and related shares as of June 30, 2025 Directors' Long Positions in Shares and Underlying Shares of the Company (as of June 30, 2025) | Director Name | Capacity/Nature of Interest | Total Shares | Approximate Equity Percentage | | :--- | :--- | :--- | :--- | | Mr. Zhang Jianming | Corporate Interest (1) | 527,940,219 | 33.08% | | Mr. Zhang Jianming | Corporate Interest (2) | 3,723,000 | 0.23% | | Mr. Zhang Jianfeng | Corporate Interest (2) | 1,500,000 | 0.09% | | Mr. Liu Jianbo | Corporate Interest (2) | 540,000 | 0.03% | | Mr. Guo Mingguang | Corporate Interest (2) | 100,000 | 0.01% | | Mr. Guo Mingguang | Spouse's Interest (3) | 177,000 | 0.01% | | Mr. Chen Weiqun | Corporate Interest (2) | 250,000 | 0.02% | - Mr. Zhang Jianming indirectly holds company shares through **Premier Capital Management Pte. Ltd.** and **Cambridge Management Consultants (PTC) Ltd.**[44](index=44&type=chunk) - Other directors hold company shares through their wholly-owned investment holding companies[44](index=44&type=chunk) [Shareholders' Interests and Short Positions](index=13&type=section&id=%E8%82%A1%E6%9D%B1%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) This section outlines the long positions held by substantial shareholders in the company's shares and related shares as of June 30, 2025 Major Shareholders' Long Positions in Shares and Underlying Shares of the Company (as of June 30, 2025) | Shareholder Name | Capacity/Nature of Interest | Total Shares | Approximate Equity Percentage | | :--- | :--- | :--- | :--- | | Mr. Zhang Jingzhang | Corporate Interest (1) | 527,940,219 | 33.08% | | Mr. Zhang Jingzhang | Corporate Interest (2) | 493,000 | 0.03% | | Tianfu Capital Limited | Beneficial Owner | 433,888,453 | 27.18% | | Premier Capital Management Pte. Ltd. | Beneficial Owner | 292,818,000 | 18.35% | | Cambridge Management Consultants (PTC) Ltd. | Beneficial Owner | 235,122,219 | 14.73% | | UBS Trustees (B.V.I.) Limited | Trustee (3) | 433,888,453 | 27.18% | - Mr. Zhang Jingzhang indirectly holds company shares through **Premier Capital** and **Cambridge Management**, and indirectly holds shares held by **Fiery Force Inc.**[45](index=45&type=chunk) - **UBS Trustees (B.V.I.) Limited**, as trustee for several trusts, is deemed to have an interest in the shares held by **Tianfu Capital Limited**[46](index=46&type=chunk) [Other Information](index=14&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) [Material Investments, Acquisitions and Disposals](index=14&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E3%80%81%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE) During the reporting period, the company held no material investments and did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures - The company held no material investments during the reporting period, and the Group did not undertake any material acquisitions or disposals of subsidiaries, associates, or joint ventures[48](index=48&type=chunk) [Future Plans for Material Investments or Capital Assets and Expected Funding Sources](index=14&type=section&id=%E6%9C%89%E9%97%9C%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E5%8F%8A%E9%A0%90%E6%9C%9F%E8%B3%87%E9%87%91%E4%BE%86%E6%BA%90%E7%9A%84%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) As of June 30, 2025, the company had no specific future plans for material investments or capital assets - As of June 30, 2025, the company had no specific future plans regarding material investments or capital assets[49](index=49&type=chunk) [Compliance with Corporate Governance Code](index=14&type=section&id=%E9%81%B5%E5%AE%88%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) The company's Board of Directors is committed to maintaining high corporate governance standards and confirmed compliance with all applicable provisions of the Corporate Governance Code during the reporting period - The Board is committed to maintaining and ensuring high standards of corporate governance practices and has complied with all applicable code provisions of Part 2 of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules of the Stock Exchange[50](index=50&type=chunk) [Purchase, Sale or Redemption of Shares](index=14&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E8%82%A1%E4%BB%BD) During the reporting period, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities, and no treasury shares were held as of June 30, 2025 - Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the reporting period[51](index=51&type=chunk) - As of June 30, 2025, the company held no treasury shares[52](index=52&type=chunk) [Audit Committee](index=14&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, comprising three independent non-executive directors, reviewed the condensed consolidated interim financial information for H1 2025 and confirmed its compliance with applicable accounting principles - The Audit Committee, composed of three independent non-executive directors, is responsible for reviewing and overseeing the Group's financial reporting process and internal controls[53](index=53&type=chunk) - The Audit Committee has reviewed the Group's condensed consolidated interim financial information for the six months ended June 30, 2025, and confirmed compliance with applicable accounting principles, standards, and requirements[53](index=53&type=chunk) [Standard Code for Securities Transactions by Directors of the Company](index=14&type=section&id=%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E7%9A%84%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87) The company has adopted the Standard Code for Securities Transactions by Directors and confirmed all directors' compliance during the reporting period - The company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 to the Listing Rules, and specific inquiries confirmed all directors' compliance with the required standards during the reporting period[54](index=54&type=chunk) [Condensed Consolidated Financial Statements](index=15&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=15&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E6%90%8D%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the company reported a 12.5% increase in revenue to RMB 9,018,279 thousand, with gross profit up 14.2% to RMB 2,960,180 thousand, and growth in both operating profit and profit attributable to shareholders, resulting in basic earnings per share of RMB 1.07 Condensed Consolidated Statement of Profit or Loss Summary (for the six months ended June 30, RMB thousand) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 9,018,279 | 8,017,811 | | Cost of Sales | (6,058,099) | (5,426,194) | | Gross Profit | 2,960,180 | 2,591,617 | | Selling and Marketing Expenses | (743,977) | (645,948) | | General and Administrative Expenses | (592,090) | (496,314) | | Other Income | 227,331 | 228,680 | | Other Gains – Net | 132,015 | 72,814 | | Operating Profit | 1,983,459 | 1,750,849 | | Net Finance Income | 80,089 | 98,859 | | Share of Profit of Associates | 18,318 | 5,292 | | Profit Before Income Tax | 2,081,866 | 1,855,000 | | Income Tax Expense | (369,521) | (333,343) | | Profit for the Period | 1,712,345 | 1,521,657 | | Profit Attributable to Shareholders | 1,711,509 | 1,520,630 | | Basic Earnings Per Share (RMB) | 1.07 | 0.95 | [Condensed Consolidated Statement of Comprehensive Income](index=16&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E7%B6%9C%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the company's profit for the period was RMB 1,712,345 thousand, with a significant positive impact from currency translation differences, leading to increased total comprehensive income Condensed Consolidated Statement of Comprehensive Income Summary (for the six months ended June 30, RMB thousand) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit for the Period | 1,712,345 | 1,521,657 | | Currency Translation Differences | 144,231 | (89,041) | | Total Comprehensive Income for the Period | 1,856,576 | 1,432,616 | | Total Comprehensive Income Attributable to Shareholders | 1,855,740 | 1,431,589 | | Non-controlling Interests | 836 | 1,027 | - In H1 2025, currency translation differences shifted from a loss to a gain of **RMB 144,231 thousand**, significantly boosting total comprehensive income[58](index=58&type=chunk) [Condensed Consolidated Statement of Financial Position](index=17&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E8%A1%A8) As of June 30, 2025, total assets increased to RMB 33,668,216 thousand, with notable changes in non-current and current financial assets, and a shift in the composition of bank borrowings Condensed Consolidated Statement of Financial Position Summary (RMB thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Property, Plant and Equipment | 7,180,924 | 6,611,640 | | Financial Assets at FVTPL (Non-current) | 3,773,268 | 2,365,634 | | Time Deposits (Non-current) | 820,859 | 2,051,307 | | Inventories | 4,717,297 | 4,576,322 | | Trade and Bills Receivables (Current) | 5,121,931 | 3,705,594 | | Financial Assets at FVTPL (Current) | 3,206,026 | 4,605,836 | | Cash and Cash Equivalents | 2,528,583 | 2,745,387 | | **Liabilities** | | | | Bank Borrowings (Non-current) | 224,927 | 2,011,287 | | Trade and Bills Payables | 5,714,732 | 4,576,533 | | Bank Borrowings (Current) | 2,115,609 | – | | **Equity** | | | | Total Equity | 21,649,531 | 20,869,475 | | Total Assets | 33,668,216 | 31,145,511 | | Net Current Assets | 8,024,944 | 9,812,829 | - Total assets increased from **RMB 31,145,511 thousand** at the end of 2024 to **RMB 33,668,216 thousand** as of June 30, 2025[60](index=60&type=chunk) - Non-current bank borrowings significantly decreased, while current bank borrowings increased from zero to **RMB 2,115,609 thousand**, indicating a shift in borrowing structure[61](index=61&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=19&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) For the six months ended June 30, 2025, total equity attributable to shareholders increased to RMB 21,626,077 thousand, driven by profit for the period and positive currency translation differences, partially offset by dividends paid Condensed Consolidated Statement of Changes in Equity Summary (for the six months ended June 30, RMB thousand) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Equity Attributable to Shareholders at Beginning of Period | 20,845,030 | 18,816,089 | | Profit for the Period | 1,711,509 | 1,520,630 | | Other Comprehensive Income (Currency Translation Differences) | 144,231 | (89,041) | | Total Comprehensive Income for the Period | 1,855,740 | 1,431,589 | | Dividends Paid – Attributable to Shareholders | (1,074,693) | (957,735) | | Dividends Paid to Non-controlling Interests | (1,827) | – | | Equity Attributable to Shareholders at End of Period | 21,626,077 | 19,289,943 | - In H1 2025, total equity attributable to shareholders increased from **RMB 20,845,030 thousand** at the beginning of the period to **RMB 21,626,077 thousand** at the end of the period[63](index=63&type=chunk) - Dividends paid to shareholders amounted to **RMB 1,074,693 thousand**, and dividends to non-controlling interests were **RMB 1,827 thousand**[63](index=63&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=20&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the six months ended June 30, 2025, net cash from operating activities increased, while net cash outflows from investing and financing activities significantly decreased, leading to a substantial reduction in the net decrease in cash and cash equivalents Condensed Consolidated Statement of Cash Flows Summary (for the six months ended June 30, RMB thousand) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | 1,402,439 | 1,205,412 | | Net Cash Used in Investing Activities | (861,359) | (2,682,786) | | Net Cash Used in Financing Activities | (757,884) | (1,588,480) | | Net Decrease in Cash and Cash Equivalents | (216,804) | (3,065,854) | | Cash and Cash Equivalents at Beginning of Period | 2,745,387 | 5,445,649 | | Cash and Cash Equivalents at End of Period | 2,528,583 | 2,379,795 | - Net cash generated from operating activities increased by **16.3% year-on-year** to **RMB 1,402,439 thousand**[64](index=64&type=chunk) - Net cash used in investing activities significantly decreased, primarily due to a reduction in net proceeds from the purchase of financial instruments[64](index=64&type=chunk) - Net cash used in financing activities substantially decreased, mainly due to a shift from net outflow to net inflow in bank borrowings[64](index=64&type=chunk) [Notes to the Condensed Consolidated Financial Information](index=21&type=section&id=%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) [General Information](index=21&type=section&id=%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) Haitian International Holdings Limited and its subsidiaries primarily engage in the manufacturing and distribution of injection molding machines, with its ultimate controlling parties being Mr. Zhang Jingzhang and Mr. Zhang Jianming - The company and its subsidiaries are primarily engaged in the manufacturing and distribution of injection molding machines[66](index=66&type=chunk) - The company was incorporated in the Cayman Islands on July 13, 2006, and its shares were listed on the Main Board of The Stock Exchange of Hong Kong Limited on December 22, 2006[66](index=66&type=chunk)[67](index=67&type=chunk) - Mr. Zhang Jingzhang (former director of the company) and Mr. Zhang Jianming are the ultimate controlling parties of the company[66](index=66&type=chunk) [Basis of Preparation](index=21&type=section&id=%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) The condensed consolidated interim financial information for the six months ended June 30, 2025, has been prepared in accordance with HKAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual financial statements for the year ended December 31, 2024 - The condensed consolidated interim financial information has been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting"[68](index=68&type=chunk) - The financial statements are presented in RMB and were approved for issue by the Board of Directors on August 18, 2025[67](index=67&type=chunk) [Accounting Policies](index=22&type=section&id=%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) The accounting policies adopted for the condensed consolidated interim financial information are consistent with those used for the annual consolidated financial statements for the year ended December 31, 2024, with no material impact from newly adopted HKFRS amendments - The accounting policies adopted for the preparation of the condensed consolidated interim financial information are consistent with those adopted for the annual consolidated financial statements, except for the initial adoption of amended HKFRS accounting standards[70](index=70&type=chunk) - Hong Kong Accounting Standard 21 (Amendment) "Lack of Exchangeability" had no impact on the condensed consolidated interim financial information, as the Group's transaction and functional currencies are exchangeable[71](index=71&type=chunk) [Revenue and Segment Information](index=22&type=section&id=%E6%94%B6%E5%85%A5%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group operates in a single reportable segment, manufacturing and selling injection molding machines, with total sales of RMB 9,018,279 thousand in H1 2025, split between mainland China and overseas markets - The Group is primarily engaged in the manufacturing and sale of injection molding machines, with only one reportable segment[72](index=72&type=chunk) External Customer Sales by Region (for the six months ended June 30, RMB thousand) | Region | 2025 | 2024 | | :--- | :--- | :--- | | Mainland China | 5,200,565 | 5,182,546 | | Hong Kong and Overseas Countries | 3,817,714 | 2,835,265 | | Total | 9,018,279 | 8,017,811 | Total Non-current Assets by Region (RMB thousand) | Region | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Mainland China | 5,843,768 | 5,628,370 | | Hong Kong and Overseas Countries | 3,049,848 | 2,109,295 | [Operating Profit](index=24&type=section&id=%E7%B6%93%E7%87%9F%E5%88%A9%E6%BD%A4) In H1 2025, operating profit was influenced by increased depreciation, impairment provisions for trade receivables and inventories, and higher raw material costs, partially offset by net exchange gains and fair value gains on financial assets Key Items Affecting Operating Profit (for the six months ended June 30, RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Depreciation and Amortization | 238,516 | 215,522 | | Impairment Provision for Trade Receivables | 56,161 | 24,496 | | Inventory Write-down Provision / (Reversal) | 26,254 | (2,132) | | Raw Materials and Consumables Used | 5,163,219 | 4,705,886 | | Net Exchange (Gain) / Loss | (4,921) | 23,770 | | Fair Value Gain on Financial Assets at FVTPL | (103,105) | (81,250) | - In H1 2025, both impairment provisions for trade receivables and inventory write-down provisions increased[74](index=74&type=chunk) - Net exchange differences shifted from a loss in H1 2024 to a gain in H1 2025[74](index=74&type=chunk) [Net Finance Income](index=24&type=section&id=%E8%9E%8D%E8%B3%87%E6%94%B6%E5%85%A5%EF%BC%8D%E6%B7%A8%E9%A1%8D) Net finance income decreased in H1 2025 to RMB 80,089 thousand, primarily due to lower interest income, though partially offset by a positive net exchange gain Net Finance Income (for the six months ended June 30, RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Interest Expense on Bank Loans | (25,264) | (35,428) | | Interest and Finance Charges on Lease Liabilities Paid / Payable | (2,491) | (135) | | Net Exchange Loss | – | (1,785) | | Interest Income from Restricted Bank Deposits, Time Deposits, Cash and Cash Equivalents, and Entrusted Loans | 91,270 | 136,207 | | Net Exchange Gain | 16,574 | – | | Net Finance Income | 80,089 | 98,859 | - Interest income decreased from **RMB 136,207 thousand** to **RMB 91,270 thousand**[75](index=75&type=chunk) - Net exchange differences shifted from a loss of **RMB 1,785 thousand** in H1 2024 to a gain of **RMB 16,574 thousand** in H1 2025[75](index=75&type=chunk) [Income Tax Expense](index=25&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income tax expense increased to RMB 369,521 thousand in H1 2025, driven by higher current income taxes in mainland China, Hong Kong, and overseas, while deferred tax was a credit Income Tax Expense (for the six months ended June 30, RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Current Income Tax – Mainland China Corporate Income Tax and Hong Kong Profits Tax | 294,498 | 245,553 | | Current Income Tax – Overseas Income Tax | 80,109 | 60,429 | | Deferred Tax | (5,086) | 27,361 | | Total | 369,521 | 333,343 | - Current income tax (Mainland China and Hong Kong) and overseas income tax both increased[76](index=76&type=chunk) - Deferred tax shifted from an expense in H1 2024 to a credit in H1 2025[76](index=76&type=chunk) [Dividends](index=25&type=section&id=%E8%82%A1%E6%81%AF) The Board resolved not to declare an interim dividend for H1 2025, with potential distribution to be considered after reviewing the full-year results - At the Board meeting held on August 18, 2025, the directors resolved not to declare an interim dividend for the reporting period, with potential distribution to be considered after reviewing the full-year results[77](index=77&type=chunk) [Earnings Per Share](index=25&type=section&id=%E6%AF%8F%E8%82%A1%E7%9B%88%E5%88%A9) Basic earnings per share for H1 2025 increased to RMB 1.07, with no diluted earnings per share presented due to the absence of dilutive ordinary shares - Basic earnings per share for the period were calculated based on profit attributable to shareholders of approximately **RMB 1,711,509,000** and the weighted average number of ordinary shares outstanding of **1,596,000,000** during the period[78](index=78&type=chunk) - Basic earnings per share were **RMB 1.07** (2024: RMB 0.95)[78](index=78&type=chunk) - Diluted earnings per share are not presented as there were no dilutive ordinary shares[78](index=78&type=chunk) [Capital Expenditure](index=25&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF) Total capital expenditure for H1 2025 amounted to RMB 632,560 thousand, primarily for the acquisition of property, plant, and equipment Capital Expenditure (for the six months ended June 30, RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Land Use Rights | 292 | – | | Property, Plant and Equipment | 632,268 | 583,814 | | Total | 632,560 | 583,814 | - Total capital expenditure for H1 2025 was **RMB 632,560 thousand**, an increase compared to the same period last year[79](index=79&type=chunk) [Trade and Bills Receivables](index=26&type=section&id=%E6%87%89%E6%94%B6%E8%B2%A3%E6%98%93%E8%B3%87%E6%AC%BE%E5%8F%8A%E6%87%89%E6%94%B6%E7%A5%A8%E6%93%9A) As of June 30, 2025, total trade and bills receivables amounted to RMB 5,634,218 thousand, with the majority aged within one year, and an increase in impairment provisions - The Group grants credit periods to customers ranging from **15 to 36 months**[81](index=81&type=chunk) Ageing Analysis of Trade and Bills Receivables (RMB thousand) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 5,040,200 | 3,804,605 | | 1 to 2 years | 445,848 | 333,972 | | 2 to 3 years | 102,320 | 68,426 | | Over 3 years | 45,850 | 33,825 | | Total | 5,634,218 | 4,240,828 | | Less: Impairment Provision | (184,846) | (135,405) | | Net | 5,449,372 | 4,105,423 | - Impairment provision increased from **RMB 135,405 thousand** as of December 31, 2024, to **RMB 184,846 thousand** as of June 30, 2025[81](index=81&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=26&type=section&id=%E4%BB%A5%E5%85%AC%E5%85%81%E5%83%B9%E5%80%BC%E8%A8%88%E9%87%8F%E4%B8%94%E5%85%B6%E8%AE%8A%E5%8B%95%E8%A8%88%E5%85%A5%E6%90%8D%E7%9B%8A%E7%9A%84%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) As of June 30, 2025, the Group held approximately RMB 6,979.3 million in financial assets at fair value through profit or loss, primarily wealth management products aimed at enhancing capital efficiency and investment returns - As of June 30, 2025, the Group held financial assets at fair value through profit or loss of approximately **RMB 6,979.3 million** (December 31, 2024: RMB 6,971.5 million)[82](index=82&type=chunk) - These financial assets include bank structured deposits, bank wealth management products, trust products, and fund products, with expected yields ranging from **1.5% to 6.8% per annum** (2024: 2.0% to 7.8%)[82](index=82&type=chunk) [Share Capital](index=27&type=section&id=%E8%82%A1%E6%9C%AC) As of June 30, 2025, the company's authorized share capital comprised 5,000,000 thousand ordinary shares, with 1,596,000 thousand ordinary shares issued and fully paid, amounting to RMB 160,510 thousand Share Capital Information (as of June 30, 2025) | Item | Number of Ordinary Shares (thousand) | HKD thousand | RMB thousand | | :--- | :--- | :--- | :--- | | Authorized Share Capital | 5,000,000 | 500,000 | 502,350 | | Issued and Fully Paid Share Capital | 1,596,000 | 159,600 | 160,510 | [Trade and Bills Payables](index=27&type=section&id=%E6%87%89%E4%BB%98%E8%B2%A3%E6%98%93%E8%B3%87%E6%AC%BE%E5%8F%8A%E6%87%89%E4%BB%98%E7%A5%A8%E6%93%9A) As of June 30, 2025, total trade and bills payables amounted to RMB 5,714,732 thousand, with the majority aged within one year Ageing Analysis of Trade and Bills Payables (RMB thousand) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 5,708,158 | 4,571,721 | | 1 to 2 years | 3,450 | 3,505 | | Over 2 years | 3,124 | 1,307 | | Total | 5,714,732 | 4,576,533 | - Total trade and bills payables increased from **RMB 4,576,533 thousand** as of December 31, 2024, to **RMB 5,714,732 thousand** as of June 30, 2025[84](index=84&type=chunk) [Capital Commitments](index=27&type=section&id=%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) As of June 30, 2025, the company had capital commitments of RMB 461,102 thousand for the acquisition of property, plant, and equipment, contracted but not provided for Capital Commitments (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Capital Commitments for Acquisition of Property, Plant and Equipment – Contracted but not Provided For | 461,102 | 766,473 | - Capital commitments for the acquisition of property, plant, and equipment decreased compared to the end of 2024[85](index=85&type=chunk) [Related Party Transactions](index=28&type=section&id=%E9%97%9C%E8%81%AF%E4%BA%BA%E5%A3%AB%E4%BA%A4%E6%98%93) The Group engages in extensive transactions with related companies controlled by its directors, including procurement, sales, and services, with various outstanding balances at period-end [Related Party Transactions](index=30&type=section&id=%E9%97%9C%E8%81%AF%E4%BA%BA%E5%A3%AB%E4%BA%A4%E6%98%93) The Group conducted various related party transactions in H1 2025, primarily involving procurement of goods and services, and leasing activities Major Related Party Transactions (for the six months ended June 30, RMB thousand) | Transaction Type | 2025 | 2024 | | :--- | :--- | :--- | | Purchase of Goods from Related Companies | 769,178 | 729,423 | | Purchase of Equipment from Related Companies | 2,451 | 11,614 | | Right-of-Use Assets Arising from Lease of Buildings from Related Companies | 32,076 | – | | Purchase of Services from Related Companies | 2,215 | 2,001 | | Sale of Goods to Related Companies | 1,123 | 1,095 | | Provision of Services to Related Companies | 6,272 | 5,383 | | Rental Income from Related Companies | 7,355 | 7,025 | | Advances to Related Parties | 3,291 | 2,508 | | Sale of Equipment to Related Companies | 57 | 153 | - Procurement of goods from related companies such as **Ningbo Dongxin** and **Haitian Zhilian** constitutes a major type of related party transaction[89](index=89&type=chunk) - Right-of-use assets arising from the lease of buildings from related companies significantly increased in H1 2025[89](index=89&type=chunk) [Balances with Related Parties](index=33&type=section&id=%E8%88%87%E9%97%9C%E8%81%AF%E4%BA%BA%E5%A3%AB%E7%9A%84%E7%B5%90%E9%A4%98) Balances with related parties are unsecured, interest-free, and without fixed repayment terms, with a notable increase in lease liabilities from related companies in H1 2025 Significant Balances with Related Parties (RMB thousand) | Balance Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Payables for Purchase of Goods from Related Companies | 502,357 | 610,383 | | Payables for Purchase of Equipment from Related Companies | 21,455 | 7,315 | | Receivables for Sale of Goods and Provision of Services and Rental Income to Related Companies | 13,699 | 9,467 | | Prepayments for Purchase of Equipment from Related Companies | 1,197 | – | | Investment in an Entity Controlled by the Group's Directors (Haitian Zhizheng) | 99,800 | 99,800 | | Lease Liabilities for Lease of Buildings from Related Companies | 99,991 | – | - Balances with related parties are **unsecured, interest-free, and have no fixed repayment terms**[93](index=93&type=chunk) - Lease liabilities arising from the lease of buildings from related companies significantly increased in H1 2025[93](index=93&type=chunk) [Key Management Personnel Remuneration](index=35&type=section&id=%E4%B8%BB%E8%A6%81%E7%AE%A1%E7%90%86%E4%BA%BA%E5%93%A1%E9%85%AC%E9%87%91) Total remuneration for key management personnel increased in H1 2025, primarily due to a significant rise in discretionary bonuses Key Management Personnel Remuneration (for the six months ended June 30, RMB thousand) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Basic Salaries, Housing Allowances, Other Allowances and Benefits in Kind | 7,194 | 6,545 | | Contributions to Pension Schemes | 101 | 102 | | Discretionary Bonuses | 2,690 | 1,413 | | Total | 9,985 | 8,060 | - Total remuneration for key management personnel increased from **RMB 8,060 thousand** in H1 2024 to **RMB 9,985 thousand** in H1 2025, mainly due to a significant increase in discretionary bonuses[95](index=95&type=chunk) [Related Party Commitments](index=35&type=section&id=%E9%97%9C%E8%81%AF%E4%BA%BA%E5%A3%AB%E6%89%BF%E6%93%94) As of June 30, 2025, capital commitments for the acquisition of property, plant, and equipment from Haitian Precision amounted to RMB 16,335 thousand Related Party Capital Commitments (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Capital Commitments for Acquisition of Property, Plant and Equipment – Haitian Precision | 16,335 | 21,257 | - As of June 30, 2025, capital commitments for the acquisition of property, plant, and equipment related to **Haitian Precision** amounted to **RMB 16,335 thousand**[95](index=95&type=chunk)

[Corporate Information](index=2&type=section&id=Corporate%20Information) This section provides the company's basic information, including board members, committee compositions, contact details, and listing information, outlining its governance structure and external communication channels [Corporate Information and Governance Structure](index=3&type=section&id=Corporate%20Information) This section details the company's fundamental information, including board composition, committee structures, key contacts, and listing specifics, illustrating its governance framework - The Board of Directors comprises executive directors including Mr. Liu Yang (Chairman), Mr. Wang Zijiang, Mr. Chen Xiaohua (General Manager), and independent non-executive directors including Mr. Liang Jinyun, Mr. Liu Chenguang, and Ms. Shan Honghong[4](index=4&type=chunk) - The Company has established an Audit Committee, Remuneration Committee, Nomination Committee, and Safety and Environmental Protection Committee to ensure effective corporate governance[5](index=5&type=chunk) - The Company's stock code is **609**, listed on The Stock Exchange of Hong Kong Limited, with investor relations contact at **852-2866 6848**[9](index=9&type=chunk)[10](index=10&type=chunk) [Condensed Consolidated Income Statement](index=5&type=section&id=Condensed%20Consolidated%20Income%20Statement) This section presents the company's financial performance, showing a 5.6% decrease in revenue to RMB 932.3 million and a 19.0% decline in gross profit to RMB 116.7 million for the six months ended June 30, 2025 [Financial Performance Overview](index=5&type=section&id=Condensed%20Consolidated%20Income%20Statement) For the six months ended June 30, 2025, the company's revenue decreased by 5.6% to RMB 932.3 million, gross profit fell by 19.0% to RMB 116.7 million, and profit for the period significantly dropped by 43.2% to RMB 19.2 million Condensed Consolidated Income Statement (RMB'000) | Metric | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Revenue | 932,301 | 987,765 | -5.6% | | Cost of sales | (815,625) | (843,681) | -3.3% | | Gross profit | 116,676 | 144,084 | -19.0% | | Other income and gains | 18,100 | 18,166 | -0.4% | | Selling expenses | (40,747) | (36,327) | +12.2% | | Administrative and other operating expenses | (52,197) | (83,289) | -37.3% | | Finance costs | (6,395) | (638) | +902.4% | | Profit before income tax | 35,437 | 41,996 | -15.6% | | Income tax expense | (16,206) | (8,146) | +99.0% | | Profit for the period | 19,231 | 33,850 | -43.2% | | Profit attributable to owners of the Company | 35,154 | 42,357 | -17.0% | | Basic earnings per share | RMB0.040 | RMB0.049 | -18.4% | [Condensed Consolidated Statement of Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) This section details the company's total comprehensive income, which decreased significantly by 62.3% to RMB 13.1 million for the six months ended June 30, 2025, primarily due to negative currency translation differences [Analysis of Total Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, profit for the period was RMB 19.2 million, but negative currency translation differences of RMB 6.2 million led to a total comprehensive income of RMB 13.1 million, a 62.3% decrease year-on-year Condensed Consolidated Statement of Comprehensive Income (RMB'000) | Metric | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Profit for the period | 19,231 | 33,850 | -43.2% | | Other comprehensive income (currency translation differences) | (6,175) | 737 | -938.4% | | Total comprehensive income for the period | 13,056 | 34,587 | -62.3% | | Total comprehensive income attributable to owners of the Company | 28,803 | 43,242 | -33.4% | | Total comprehensive income attributable to non-controlling interests | (15,747) | (8,655) | +81.9% | [Condensed Consolidated Statement of Financial Position](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) This section outlines the company's assets, liabilities, and equity as of June 30, 2025, showing a slight decrease in total assets less current liabilities and stable total equity [Assets, Liabilities, and Equity Status](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, total assets less current liabilities were RMB 2,529.4 million, a slight decrease from 2024 year-end, with net current assets declining to RMB 867.3 million, while total equity remained stable at RMB 2,504.6 million Condensed Consolidated Statement of Financial Position (RMB'000) | Metric | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | 变化 (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 1,662,114 | 1,659,245 | +0.2% | | Current assets | 1,520,861 | 1,425,188 | +6.7% | | Current liabilities | 653,606 | 524,507 | +24.6% | | Net current assets | 867,255 | 900,681 | -3.7% | | Total assets less current liabilities | 2,529,369 | 2,559,926 | -1.2% | | Non-current liabilities | 24,778 | 45,002 | -44.9% | | Net assets | 2,504,591 | 2,514,924 | -0.4% | | Total equity | 2,504,591 | 2,514,924 | -0.4% | - Trade and bills receivables increased by **22.3%** from **RMB 377,774 thousand** at the end of 2024 to **RMB 461,932 thousand**[15](index=15&type=chunk) - Bank borrowings increased by **60.9%** from **RMB 220,134 thousand** at the end of 2024 to **RMB 354,191 thousand**[15](index=15&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This section analyzes the company's cash flows, showing a significant 66.8% decrease in net cash from operating activities, a shift to net cash inflow from investing activities, and a stable net cash from financing activities [Cash Flow Analysis](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash from operating activities significantly decreased by 66.8% to RMB 50.3 million, while investing activities shifted to a net inflow of RMB 209.6 million, primarily due to fixed deposit withdrawals Condensed Consolidated Statement of Cash Flows (RMB'000) | Metric | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Net cash generated from operating activities | 50,349 | 151,845 | -66.8% | | Net cash generated from / (used in) investing activities | 209,602 | (209,339) | +199.9% | | Net cash generated from financing activities | 22,104 | 25,381 | -12.8% | | Net increase / (decrease) in cash and cash equivalents | 282,055 | (32,113) | +978.2% | | Cash and cash equivalents at end of period | 633,913 | 144,371 | +339.1% | - Non-cash financing activities include supplier financing arrangements with banks, where banks directly paid **RMB 106,400 thousand** to suppliers, which the Group classified as "bank borrowings"[20](index=20&type=chunk)[21](index=21&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=9&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) This section details the changes in the company's equity, showing a slight increase in equity attributable to owners of the Company, influenced by dividend declarations, share issuance from option exercises, and profit for the period [Equity Composition and Changes](index=9&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) As of June 30, 2025, equity attributable to owners of the Company slightly increased to RMB 2,425.5 million, with key changes including a declared 2024 final dividend of RMB 24.2 million, share issuance from option exercises of RMB 0.8 million, and profit for the period of RMB 35.2 million Condensed Consolidated Statement of Changes in Equity (RMB'000) | Metric | 2025年1月1日 (RMB'000) | 2025年6月30日 (RMB'000) | 变动 (RMB'000) | | :--- | :--- | :--- | :--- | | Share capital | 8,060 | 8,069 | +9 | | Share premium | 146,691 | 147,611 | +920 | | Exchange fluctuation reserve | 19,120 | 12,769 | -6,351 | | Retained profits | 1,153,733 | 1,164,669 | +10,936 | | Total equity attributable to owners of the Company | 2,420,103 | 2,425,517 | +5,414 | | Non-controlling interests | 94,821 | 79,074 | -15,747 | | Total equity | 2,514,924 | 2,504,591 | -10,333 | - The 2024 final dividend of **RMB 24,218 thousand** was declared and paid on August 28, 2025[22](index=22&type=chunk) - Share capital increased by **RMB 9 thousand** and share premium increased by **RMB 920 thousand** due to the exercise of share options[22](index=22&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes to the financial statements, covering general information, accounting policies, critical judgments, segment information, revenue breakdown, finance costs, profit before tax, income tax, dividends, earnings per share, asset details, receivables, payables, share capital, commitments, share-based payments, related party transactions, and fair value measurements [1. General Information and Basis of Preparation and Presentation](index=11&type=section&id=1.%20General%20Information%20and%20Basis%20of%20Preparation%20and%20Presentation) This section outlines Tianneng Chemical Holdings Limited's registration, primary business (R&D, manufacturing, and sales of fine chemical products), and the basis for preparing interim financial statements under HKAS 34 and Listing Rules, noting HKD as functional currency and RMB as presentation currency - The Company's principal business is investment holding, while its subsidiaries are primarily engaged in the research, development, manufacturing, and sales of fine chemical products[26](index=26&type=chunk)[30](index=30&type=chunk) - The unaudited condensed financial information is prepared in accordance with Hong Kong Accounting Standard 34 issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of Appendix D2 to the Listing Rules of the Stock Exchange[27](index=27&type=chunk)[31](index=31&type=chunk) - The Company's functional currency is HKD, but due to its principal operations being in China, the unaudited condensed financial information is presented in RMB[27](index=27&type=chunk)[34](index=34&type=chunk) [2. Significant Accounting Policies](index=12&type=section&id=2.%20Significant%20Accounting%20Policies) This section details the Group's initial application of new and revised HKFRSs, including amendments to HKAS 21 and HKFRS 1 (Lack of Exchangeability), and notes the potential significant impact of HKFRS 18 on presentation and disclosure - The Group first applied the amendments to Hong Kong Accounting Standard 21 and Hong Kong Financial Reporting Standard 1, "Lack of Exchangeability," issued by the Hong Kong Institute of Certified Public Accountants, which had no impact on the interim condensed consolidated financial statements[36](index=36&type=chunk)[37](index=37&type=chunk)[38](index=38&type=chunk) - Hong Kong Financial Reporting Standard 18 (replacing Hong Kong Accounting Standard 1) is expected to have a significant impact on the presentation and disclosure of certain items in the consolidated financial statements, including classifications and subtotals in the income statement[41](index=41&type=chunk)[44](index=44&type=chunk) [3. Critical Judgements and Estimates](index=13&type=section&id=3.%20Critical%20Judgements%20and%20Estimates) The significant judgments and key sources of estimation uncertainty made by management in preparing the interim condensed financial information are consistent with those applied in the 2024 annual financial statements - The significant judgments made by management and the key sources of estimation uncertainty in preparing the unaudited condensed financial information are the same as those applied in the 2024 annual financial statements[42](index=42&type=chunk)[45](index=45&type=chunk) [4. Segment Information](index=13&type=section&id=4.%20Segment%20Information) The Group's chief operating decision maker identifies the R&D, manufacturing, and sales of fine chemical products as a single operating segment, with China remaining the primary revenue source, complemented by significant contributions from overseas markets - The Group's research, development, manufacturing, and sales of fine chemical products are identified as a single operating segment[46](index=46&type=chunk) Revenue by Region (RMB'000) | Region | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | China (local) | 643,615 | 708,475 | -9.2% | | India | 103,938 | 124,289 | -16.4% | | United Arab Emirates | 41,891 | 24,533 | +70.8% | | United States | 29,300 | 16,375 | +78.9% | | Brazil | 21,459 | 6,112 | +251.1% | | Others | 92,098 | 107,981 | -14.7% | | **Total** | **932,301** | **987,765** | **-5.6%** | - For the period ended June 30, 2025, no single customer accounted for **10% or more** of the Group's revenue[50](index=50&type=chunk)[51](index=51&type=chunk) [5. Revenue and Other Income and Gains](index=14&type=section&id=5.%20Revenue%20and%20Other%20Income%20and%20Gains) This section details the Group's revenue, primarily from fine chemical product sales, and other income and gains, including bank interest and exchange gains, totaling RMB 932.3 million and RMB 18.1 million respectively for the period Revenue and Other Income and Gains (RMB'000) | Item | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Sales of fine chemical products | 932,301 | 987,765 | -5.6% | | Government grants | 85 | 47 | +80.9% | | Bank interest income | 15,099 | 10,771 | +40.2% | | Net gain on disposal of property, plant and equipment | 1,018 | – | Not applicable | | Net exchange gain | 1,008 | 4,826 | -79.1% | | Total other income and gains | 18,100 | 18,166 | -0.4% | [6. Finance Costs](index=14&type=section&id=6.%20Finance%20Costs) This section discloses the Group's finance costs, which totaled RMB 6.4 million for the six months ended June 30, 2025, a significant 902.4% increase year-on-year, mainly due to interest from asset-backed financing, supplier financing, and advances from related companies Finance Costs (RMB'000) | Item | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Interest on bank borrowings | 2,701 | 638 | +323.4% | | Interest on asset-backed financing | 391 | – | Not applicable | | Interest on supplier financing arrangements | 3,202 | – | Not applicable | | Interest on advances from related companies | 101 | – | Not applicable | | **Total finance costs** | **6,395** | **638** | **+902.4%** | [7. Profit Before Income Tax](index=15&type=section&id=7.%20Profit%20Before%20Income%20Tax) This section details the key expenses deducted or included in calculating profit before income tax, highlighting a 14.5% decrease in total employee costs and a 58.3% decrease in research costs Expenses Deducted/Included in Profit Before Income Tax (RMB'000) | Item | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Directors' emoluments | 1,869 | 2,024 | -7.6% | | Other employee costs | 74,124 | 87,187 | -15.0% | | Contributions to retirement benefit schemes | 7,693 | 8,699 | -11.6% | | **Total employee costs** | **83,686** | **97,910** | **-14.5%** | | Depreciation of right-of-use assets | 1,287 | 1,287 | 0.0% | | Amortisation of intangible assets | 902 | 902 | 0.0% | | Cost of inventories recognised as expense | 815,625 | 843,681 | -3.3% | | Depreciation of property, plant and equipment | 90,487 | 83,700 | +8.1% | | Research costs | 22,669 | 54,426 | -58.3% | - Cost of inventories recognized as expense includes depreciation expenses of **RMB 87,464 thousand** and staff costs of **RMB 58,085 thousand**[63](index=63&type=chunk) - Research costs include depreciation expenses of **RMB 900 thousand** and staff costs of **RMB 12,286 thousand**[63](index=63&type=chunk) [8. Income Tax Expense](index=16&type=section&id=8.%20Income%20Tax%20Expense) This section details the Group's income tax expense, which significantly increased by 99.0% to RMB 16.2 million for the six months ended June 30, 2025, primarily due to a substantial rise in China dividend withholding tax Income Tax Expense (RMB'000) | Item | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Current tax – China corporate income tax | 11,319 | 9,167 | +23.5% | | – Over-provision in prior years | (641) | (1,172) | -45.3% | | – China dividend withholding tax paid | 25,706 | 970 | +2549.1% | | Deferred tax – Credit for the period | (20,178) | (819) | +2363.6% | | **Total income tax expense** | **16,206** | **8,146** | **+99.0%** | - Hong Kong-registered subsidiaries are not subject to Hong Kong profits tax as they had no assessable profits during the period[64](index=64&type=chunk)[66](index=66&type=chunk) - Subsidiaries established in China are subject to China corporate income tax at a rate of **25%**, and China withholding tax at **5% or 10%**[64](index=64&type=chunk)[67](index=67&type=chunk) [9. Dividends](index=17&type=section&id=9.%20Dividends) This section reports the declaration and payment of the 2024 final dividend of HKD 0.03 per share, totaling RMB 24.2 million, and the Board's decision not to recommend an interim dividend for the current period - The 2024 final dividend of **HKD 0.03 per share**, totaling **RMB 24,218 thousand**, was paid on August 28, 2025[68](index=68&type=chunk) - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 (2024: HKD 0.02 per share)[69](index=69&type=chunk) [10. Earnings Per Share](index=17&type=section&id=10.%20Earnings%20Per%20Share) This section provides data for calculating basic and diluted earnings per share, both of which decreased to RMB 0.040 for the six months ended June 30, 2025, compared to the prior year Earnings Per Share | Metric | 2025年6月30日止六个月 | 2024年6月30日止六个月 | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company (RMB'000) | 35,154 | 42,357 | -17.0% | | Weighted average number of ordinary shares for basic earnings per share ('000 shares) | 877,462 | 869,418 | +0.9% | | Weighted average number of ordinary shares for diluted earnings per share ('000 shares) | 877,506 | 873,606 | +0.4% | | Basic earnings per share (RMB) | 0.040 | 0.049 | -18.4% | | Diluted earnings per share (RMB) | 0.040 | 0.049 | -18.4% | [11. Property, Plant and Equipment / Right-of-use Assets](index=18&type=section&id=11.%20Property%2C%20Plant%20and%20Equipment%20%2F%20Right-of-use%20Assets) This section discloses the Group's investments, disposals, and pledges related to property, plant, and equipment and right-of-use assets, noting a significant increase in property, plant, and equipment acquisitions and certain assets pledged as collateral - For the six months ended June 30, 2025, the Group acquired property, plant and equipment totaling **RMB 97,933 thousand**, a significant increase from **RMB 47,314 thousand** in the prior period[74](index=74&type=chunk)[76](index=76&type=chunk) - During the period, a gain of **RMB 1,018 thousand** was realized from the disposal of property, plant and equipment, and property, plant and equipment with a net book value of **RMB 2,353 thousand** were written off[74](index=74&type=chunk)[76](index=76&type=chunk) - As of June 30, 2025, certain buildings with a net book value of **RMB 50,411 thousand** and right-of-use assets of **RMB 76,645 thousand** were pledged as collateral for bank borrowings of **RMB 175,000 thousand**[75](index=75&type=chunk)[78](index=78&type=chunk) [12. Trade and Bills Receivables](index=19&type=section&id=12.%20Trade%20and%20Bills%20Receivables) This section details the composition, credit terms, aging analysis, and impairment provisions for trade and bills receivables, which totaled RMB 461.9 million (net of provisions) as of June 30, 2025, representing a 22.3% increase from 2024 year-end Trade and Bills Receivables (RMB'000) | Item | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | 变化 (%) | | :--- | :--- | :--- | :--- | | Trade receivables | 328,576 | 275,024 | +19.5% | | Bills receivables | 138,089 | 105,999 | +30.3% | | Less: Provision for impairment losses | (4,733) | (3,249) | +45.7% | | **Total** | **461,932** | **377,774** | **+22.3%** | Aging Analysis of Trade and Bills Receivables (RMB'000) | Aging | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | | :--- | :--- | :--- | | 0 to 90 days | 321,193 | 275,588 | | 91 to 180 days | 49,260 | 87,238 | | 181 to 365 days | 78,260 | 14,753 | | Over 365 days | 13,219 | 195 | | **Total** | **461,932** | **377,774** | - The Group discounted certain bills receivables with full recourse to financial institutions; as of June 30, 2025, approximately **RMB 62,791 thousand** of bills receivables continued to be recognized in the financial statements and included in bank borrowings[81](index=81&type=chunk)[84](index=84&type=chunk) [13. Prepayments and Other Receivables](index=21&type=section&id=13.%20Prepayments%20and%20Other%20Receivables) This section details the composition of prepayments and other receivables, which totaled RMB 53.2 million as of June 30, 2025, a 23.6% increase from 2024 year-end, primarily due to increased advances to suppliers and prepayments Prepayments and Other Receivables (RMB'000) | Item | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | 变化 (%) | | :--- | :--- | :--- | :--- | | Advances to suppliers | 23,724 | 27,200 | -12.8% | | Recoverable VAT | 8,750 | 8,223 | +6.4% | | Prepayments | 7,311 | 894 | +717.8% | | Other receivables | 13,435 | 6,746 | +99.1% | | **Total** | **53,220** | **43,063** | **+23.6%** | [14. Trade Payables](index=21&type=section&id=14.%20Trade%20Payables) This section provides an aging analysis of trade payables, which totaled RMB 40.8 million as of June 30, 2025, a 7.5% increase from 2024 year-end, with credit terms generally ranging from 30 to 270 days Aging Analysis of Trade Payables (RMB'000) | Aging | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | | :--- | :--- | :--- | | 0 to 90 days | 35,600 | 32,497 | | 91 to 180 days | 851 | 1,798 | | 181 to 365 days | 1,666 | 1,533 | | Over 365 days | 2,638 | 2,073 | | **Total** | **40,755** | **37,901** | - The credit period for trade payables ranges from **30 to 270 days**, and their carrying amounts approximate their fair values[93](index=93&type=chunk)[95](index=95&type=chunk) [15. Accruals and Other Payables](index=22&type=section&id=15.%20Accruals%20and%20Other%20Payables) This section details the composition of accruals and other payables, which totaled RMB 240.1 million as of June 30, 2025, remaining largely stable compared to 2024 year-end, with an increase in payables for property, plant, and equipment offset by decreases in accrued expenses and staff welfare payables Accruals and Other Payables (RMB'000) | Item | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | 变化 (%) | | :--- | :--- | :--- | :--- | | Payables for property, plant and equipment | 153,969 | 140,874 | +9.3% | | Accrued expenses | 9,365 | 30,473 | -69.2% | | Payables for salaries and welfare | 5,396 | 12,452 | -56.6% | | Dividends payable | 24,218 | – | Not applicable | | **Total** | **240,084** | **238,471** | **+0.7%** | - Other payables primarily include amounts due for maintenance and procurement of spare parts[97](index=97&type=chunk) [16. Share Capital](index=22&type=section&id=16.%20Share%20Capital) This section provides details on the company's authorized and issued share capital, noting a slight increase in issued share capital to RMB 8,069 thousand as of June 30, 2025, due to the exercise of share options Share Capital (RMB'000) | Item | Number of shares ('000 shares) | Amount (RMB'000) | | :--- | :--- | :--- | | Issued and fully paid at January 1, 2024 | 869,418 | 7,986 | | Shares issued upon exercise of share options | 8,000 | 74 | | Issued and fully paid at December 31, 2024 | 877,418 | 8,060 | | Shares issued upon exercise of share options | 1,000 | 9 | | **Issued and fully paid at June 30, 2025** | **878,418** | **8,069** | [17. Commitments](index=23&type=section&id=17.%20Commitments) This section discloses the Group's capital commitments, primarily for the acquisition of property, plant, and equipment, which decreased to RMB 105.7 million as of June 30, 2025, from 2024 year-end Commitments (RMB'000) | Item | 2025年6月30日 (RMB'000) | 2024年12月31日 (RMB'000) | 变化 (%) | | :--- | :--- | :--- | :--- | | Commitments for acquisition of property, plant and equipment | 105,696 | 140,324 | -24.7% | [18. Share-based Payments](index=23&type=section&id=18.%20Share-based%20Payments) This section details the 2016 Share Option Scheme, designed to reward contributors to the Group, noting that Executive Director Mr. Chen Xiaohua exercised 1,000,000 share options during the period, resulting in no outstanding options at period-end - The 2016 Share Option Scheme became effective on May 20, 2016, with a ten-year validity, allowing for a maximum grant of **84,687,800** share options[103](index=103&type=chunk)[105](index=105&type=chunk) - During the period, option holders exercised **1,000,000** share options at an exercise price of **HKD 0.908 per option**[104](index=104&type=chunk)[106](index=106&type=chunk) - As of June 30, 2025, there were no outstanding share options granted under the 2016 Share Option Scheme[107](index=107&type=chunk) [19. Related Party Transactions](index=25&type=section&id=19.%20Related%20Party%20Transactions) This section discloses the Group's related party transactions during the period, including short-term lease expenses paid to related companies, advances from related companies, and interest payments Related Party Transactions (RMB'000) | Type of transaction | 2025年6月30日止六个月 (RMB'000) | 2024年6月30日止六个月 (RMB'000) | | :--- | :--- | :--- | | Short-term lease expenses paid to related companies | 257 | 257 | | Advances from related companies | 12,000 | – | | Repayment to related companies | 12,000 | – | | Interest paid to related companies | 101 | – | - Advances from related companies are unsecured, bear interest at an annual rate of **2%**, and are repayable within one year[114](index=114&type=chunk) [20. Fair Value Measurement](index=25&type=section&id=20.%20Fair%20Value%20Measurement) This section explains the fair value measurement hierarchy (Level 1, 2, 3) and provides an analysis of financial assets (bills receivables) measured at fair value through other comprehensive income, with fair value determined using Level 2 inputs - Fair value measurements are categorized into three levels: Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs)[117](index=117&type=chunk) Fair Value Measurement of Financial Assets (RMB'000) | Item | Level 1 (RMB'000) | Level 2 (RMB'000) | Level 3 (RMB'000) | Total (RMB'000) | | :--- | :--- | :--- | :--- | :--- | | June 30, 2025: Bills receivables | – | 138,089 | – | 138,089 | | December 31, 2024: Bills receivables | – | 105,999 | – | 105,999 | - The fair value of bills receivables is determined by discounting expected future cash flows using current available interest rates for instruments with similar terms, credit risk, and remaining maturities[120](index=120&type=chunk) [Management Discussion and Analysis](index=27&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's insights into the Group's business and financial performance, discussing market conditions, strategic responses, and key financial metrics [Business Review](index=27&type=section&id=BUSINESS%20REVIEW) Despite macroeconomic headwinds, geopolitical tensions, and US tariffs causing domestic manufacturing downturns and deflation, the Group strategically expanded overseas markets, increased capacity, and diversified applications, achieving moderate overseas sales growth that mitigated overall revenue decline - Persistent unfavorable macroeconomic factors, international geopolitical tensions, and US tariff policies severely impacted domestic manufacturing, leading to increased downward pressure on the domestic economy and intense competition due to market supply-demand imbalance[122](index=122&type=chunk)[124](index=124&type=chunk) - The selling prices of almost all the Group's products further declined compared to the same period last year[122](index=122&type=chunk)[124](index=124&type=chunk) - The Group strategically focused its marketing efforts and resources on developing overseas markets, achieving moderate year-on-year growth in overseas sales by actively expanding its international marketing network and successfully opening up new application areas in downstream industries[123](index=123&type=chunk)[125](index=125&type=chunk) - Domestic deflation led to a decrease in average raw material costs, and the Group effectively reduced labor and overall production costs through automated production processes and a circular economy production system, though this could not fully offset the negative impact of declining product selling prices[127](index=127&type=chunk)[129](index=129&type=chunk) [Outlook](index=28&type=section&id=Outlook) Looking ahead, the Group anticipates continued challenges from US-China trade tensions and a slowing domestic economy, planning to respond by expanding business scope, diversifying risks, enhancing operational flexibility, optimizing product portfolios, and seeking new revenue streams, while emphasizing cash flow management and operational efficiency - Persistent US-China trade tensions and US tariff policies pose significant pressure on the domestic economy, with continued economic slowdown and deepening deflation expected to present severe challenges to domestic manufacturing operations[128](index=128&type=chunk)[130](index=130&type=chunk) - The Group is actively expanding its business scope and diversifying its business risks, enhancing operational flexibility, continuously optimizing its product portfolio, and actively seeking new revenue sources[128](index=128&type=chunk)[131](index=131&type=chunk) - Strengthening cash flow management and improving operational efficiency remain key priorities for the Group[128](index=128&type=chunk)[131](index=131&type=chunk) [Financial Review](index=29&type=section&id=FINANCIAL%20REVIEW) This section provides a detailed review of the Group's financial performance, including declining revenue and gross profit, changes in operating expenses, significantly increased finance costs, reduced profit for the period, increased receivables and bank borrowings, and the status of liquidity and financial resources [Revenue and Gross Profit](index=29&type=section&id=Revenue%20and%20gross%20profit) Affected by the domestic economic downturn and falling product prices, the Group's total revenue decreased by 5.6% to RMB 932.3 million, and gross profit fell by 19.0% to RMB 116.7 million, with gross margin contracting by 2.1 percentage points to 12.5% Revenue and Gross Profit (RMB million) | Metric | 2025年6月30日止六个月 (RMB million) | 2024年6月30日止六个月 (RMB million) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Total revenue | 932.3 | 987.8 | -5.6% | | Gross profit | 116.7 | 144.1 | -19.0% | | Gross profit margin | 12.5% | 14.6% | -2.1个百分点 | - The decrease in revenue was primarily due to a sustained significant decline in overall product selling prices, despite moderate growth in overseas market revenue[134](index=134&type=chunk) - The decline in gross profit was due to cost savings from lower raw material costs and improved operational efficiency being insufficient to fully offset the negative impact of falling product selling prices[135](index=135&type=chunk) [Operating Expenses](index=29&type=section&id=Operating%20expenses) Selling expenses increased by 12.2% to RMB 40.7 million due to higher transportation costs from increased domestic sales of hazardous products, while administrative and other operating expenses significantly decreased by 37.3% to RMB 52.2 million due to lower R&D costs Operating Expenses (RMB million) | Metric | 2025年6月30日止六个月 (RMB million) | 2024年6月30日止六个月 (RMB million) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Selling expenses | 40.7 | 36.3 | +12.2% | | Selling expenses as % of revenue | 4.4% | 3.7% | +0.7个百分点 | | Administrative and other operating expenses | 52.2 | 83.3 | -37.3% | | Administrative and other operating expenses as % of revenue | 5.6% | 8.4% | -2.8个百分点 | - The increase in selling expenses was primarily attributable to increased domestic sales of hazardous products, leading to higher transportation costs to comply with national safety regulations[136](index=136&type=chunk) - The decrease in administrative and other operating expenses was mainly attributable to lower research and development expenses[137](index=137&type=chunk) [Finance Costs](index=30&type=section&id=Finance%20costs) Finance costs surged by 902.4% to RMB 6.4 million, primarily due to the Group's strategic increase in the use of bank borrowings, asset-backed financing, supplier financing arrangements, and advances from related companies to optimize short-term liquidity management Finance Costs (RMB million) | Metric | 2025年6月30日止六个月 (RMB million) | 2024年6月30日止六个月 (RMB million) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Finance costs | 6.4 | 0.6 | +902.4% | - The increase in finance costs was due to the strategic increase in the use of bank borrowings, asset-backed financing, supplier financing arrangements, and advances from related companies to optimize short-term liquidity management[139](index=139&type=chunk)[142](index=142&type=chunk) [Profit for the Period](index=30&type=section&id=Profit%20for%20the%20period) Influenced by the aforementioned factors, profit for the period attributable to owners of the Company decreased by 17.0% to RMB 35.2 million compared to the prior period Profit for the Period Attributable to Owners of the Company (RMB million) | Metric | 2025年6月30日止六个月 (RMB million) | 2024年6月30日止六个月 (RMB million) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company | 35.2 | 42.4 | -17.0% | [Trade and Bills Receivables](index=30&type=section&id=Trade%20and%20bills%20receivable) As of June 30, 2025, trade receivables (net of impairment provisions) increased by 19.1% to RMB 323.8 million, and bills receivables rose by 30.3% to RMB 138.1 million, with the Directors deeming no additional bad debt provision necessary Trade and Bills Receivables (RMB million) | Metric | 2025年6月30日 (RMB million) | 2024年12月31日 (RMB million) | 变化 (%) | | :--- | :--- | :--- | :--- | | Trade receivables (net of impairment provisions) | 323.8 | 271.8 | +19.1% | | Bills receivables | 138.1 | 106.0 | +30.3% | - Approximately **60.7%** of trade receivables were generated in the second quarter of the current year and were mostly not yet due, while **28.3%** of trade receivables were aged over **180 days**[144](index=144&type=chunk) - All bills receivables are bank acceptance bills, guaranteed by reputable licensed banks in China, carrying low default risk, thus requiring no bad debt provision[145](index=145&type=chunk) [Short-term Bank Borrowings](index=31&type=section&id=Short-term%20bank%20borrowings) As of June 30, 2025, total bank borrowings increased to RMB 354.2 million, primarily utilized for the Group's general working capital requirements Short-term Bank Borrowings (RMB million) | Metric | 2025年6月30日 (RMB million) | 2024年12月31日 (RMB million) | 变化 (%) | | :--- | :--- | :--- | :--- | | Total bank borrowings | 354.2 | 220.1 | +60.9% | - All bank borrowings were obtained in China, bear interest at fixed rates, are denominated in RMB, and are primarily used to finance the Group's general working capital[146](index=146&type=chunk)[149](index=149&type=chunk) [Liquidity and Financial Resources](index=31&type=section&id=Liquidity%20and%20financial%20resources) The Group maintained a sound financial position with a net cash balance of RMB 490.4 million as of June 30, 2025; despite a significant decrease in net cash inflow from operating activities, funding needs were met through new bank borrowings and fixed deposit withdrawals Liquidity and Financial Resources (RMB million) | Metric | 2025年6月30日止六个月 (RMB million) | 2024年6月30日止六个月 (RMB million) | 同比变化 (%) | | :--- | :--- | :--- | :--- | | Net cash inflow from operating activities | 50.3 | 151.8 | -66.8% | | New bank borrowings | 118.6 | 26.0 | +356.2% | | Repayment of bank borrowings | 91.0 | – | Not applicable | | Net cash balance (period-end) | 490.4 | 626.9 | -21.8% | | Net current assets (period-end) | 867.3 | 900.7 | -3.7% | - The Group's gearing ratio is not applicable as cash and cash equivalents exceeded total outstanding borrowings[151](index=151&type=chunk) - The Group is capable of meeting its capital commitments and working capital requirements for the foreseeable future and will continue to closely manage its working capital[153](index=153&type=chunk) [Pledge of Assets](index=32&type=section&id=Pledge%20of%20assets) As of June 30, 2025, the Group pledged bank deposits, certain buildings, and right-of-use assets as collateral for factory water supply guarantees, foreign exchange forward contract performance guarantees, and bank borrowings - Bank deposits of **RMB 300 thousand** were pledged as collateral for factory water supply guarantees, and **RMB 1,000 thousand** were pledged as collateral for foreign exchange forward contract performance guarantees[155](index=155&type=chunk)[160](index=160&type=chunk) - Certain buildings (**RMB 50.4 million**) and right-of-use assets (**RMB 76.6 million**) were pledged as collateral for the Group's bank borrowings[155](index=155&type=chunk)[160](index=160&type=chunk) [Contingent Liabilities](index=32&type=section&id=Contingent%20liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities[156](index=156&type=chunk)[161](index=161&type=chunk) [Exposure to Fluctuations in Exchange Rates](index=32&type=section&id=Exposure%20to%20fluctuations%20in%20exchange%20rates) The Group primarily faces RMB exchange rate fluctuation risk, with most income and expenses denominated in RMB and export sales in USD; no significant difficulties were encountered during the period, and cost-effective hedging methods will be considered in the future - The Group's most significant foreign exchange fluctuation risk arises from changes in the RMB exchange rate[157](index=157&type=chunk)[163](index=163&type=chunk) - Most of the Group's income and expenses are denominated in RMB, while export sales are primarily denominated in USD[157](index=157&type=chunk)[163](index=163&type=chunk) - No significant difficulties or impacts were encountered due to exchange rate fluctuations during the period, and cost-effective hedging methods will be considered in the future[157](index=157&type=chunk)[163](index=163&type=chunk) [Other Information](index=32&type=section&id=Other%20Information) This section covers various other corporate information, including dividend policy, human resources, directors' and substantial shareholders' securities interests, share option scheme details, compliance with securities transaction codes, share repurchase activities, and corporate governance practices [Dividends](index=33&type=section&id=DIVIDEND) The Board of Directors does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 (2024: HKD 0.02 per share)[164](index=164&type=chunk)[167](index=167&type=chunk) [Human Resources](index=33&type=section&id=HUMAN%20RESOURCES) As of June 30, 2025, the Group had 1,213 full-time employees, a decrease from 1,358 at the end of 2024, with policies in place for compensation, benefits, diverse training, and a share option scheme for employee incentives Number of Full-time Employees | Metric | 2025年6月30日 | 2024年12月31日 | 变化 (%) | | :--- | :--- | :--- | :--- | | Number of full-time employees | 1,213 | 1,358 | -10.7% | - The Group has established human resources policies and systems, including compensation and rewards, employee benefits (medical insurance and provident fund), and diverse training and personal development programs[169](index=169&type=chunk)[170](index=170&type=chunk) - The Group has adopted a share option scheme to reward eligible participants who have contributed to the Group's business achievements, but no share options were granted during the period[171](index=171&type=chunk) [Directors' and Chief Executive's Interests in Securities](index=34&type=section&id=DIRECTORS%27%20AND%20CHIEF%20EXECUTIVE%27S%20INTERESTS%20IN%20SECURITIES) As of June 30, 2025, the interests of the Company's directors, chief executive, and their associates in the Company's shares were disclosed, with Mr. Liu Yang, Mr. Wang Zijiang, and Mr. Chen Xiaohua holding significant share interests Directors' and Chief Executive's Interests in Securities | Name of Director / Chief Executive | Number of shares held / Nature of interest | Capacity | Approximate % of total issued shares | | :--- | :--- | :--- | :--- | | Mr. Liu Yang | 232,560,000 (Controlled corporation) | Interest in controlled corporation | 26.47% | | | 5,000,000 | Beneficial owner | 0.57% | | Mr. Wang Zijiang | 159,120,000 | Beneficial owner | 18.11% | | | 140,000 | Interest of spouse | 0.02% | | Mr. Chen Xiaohua | 4,532,000 | Beneficial owner | 0.52% | - Mr. Liu Yang holds **232,560,000 shares** through Zhifeng Group Limited, which he ultimately beneficially owns[176](index=176&type=chunk) - Save as disclosed, as of June 30, 2025, none of the Directors, chief executive, or their associates had any interests or short positions in the shares, underlying shares, or debentures of the Company or any of its associated corporations[177](index=177&type=chunk)[178](index=178&type=chunk) [Substantial Shareholders](index=35&type=section&id=SUBSTANTIAL%20SHAREHOLDERS) As of June 30, 2025, besides the directors, substantial shareholders holding 5% or more of the issued shares included Zhifeng Group Limited, Ms. Sun Jianhua, and Ms. Zheng Hong Substantial Shareholders' Interests | Name of Shareholder | Number of shares held / Nature and total amount of interest | Capacity | Approximate % of total issued shares | | :--- | :--- | :--- | :--- | | Zhifeng Group Limited | 232,560,000 | Beneficial owner | 26.47% | | Ms. Sun Jianhua | 70,380,000 | Beneficial owner | 8.01% | | Ms. Zheng Hong | 70,380,000 | Beneficial owner | 8.01% | - The entire issued share capital of Zhifeng Group Limited is ultimately beneficially owned by Mr. Liu Yang, an executive director[183](index=183&type=chunk)[184](index=184&type=chunk) - Mr. Gao Feng is deemed to have an interest in the same number of shares held by Ms. Zheng Hong under the Securities and Futures Ordinance[183](index=183&type=chunk)[184](index=184&type=chunk) [Share Option Scheme](index=36&type=section&id=SHARE%20OPTION%20SCHEME) This section provides details on the changes in the 2016 Share Option Scheme, noting that Executive Director Mr. Chen Xiaohua exercised 1,000,000 share options during the period, resulting in no outstanding options at period-end Share Option Scheme Movements | Name of grantee | Date of grant | Vesting period | Exercise period | Exercise price | Outstanding at beginning of period | Exercised during period | Outstanding at end of period | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Chen Xiaohua | 2021年8月30日 | 2021年8月30日至2023年8月29日 | 2023年8月30日至2028年8月29日 | HKD 0.908 | 1,000,000 | 1,000,000 | – | - No share options were granted under the 2016 Share Option Scheme during the period[189](index=189&type=chunk)[192](index=192&type=chunk) [Model Code for Securities Transactions by Directors of Listed Companies](index=36&type=section&id=MODEL%20CODE%20FOR%20SECURITIES%20TRANSACTIONS%20BY%20DIRECTORS%20OF%20LISTED%20COMPANIES) The Company has adopted a code of conduct for directors' securities transactions no less exacting than the Model Code in Appendix C3 of the Listing Rules, with all directors confirming compliance for the six months ended June 30, 2025 - The Company has adopted a code of conduct for directors' securities transactions no less exacting than the Model Code set out in Appendix C3 of the Listing Rules[190](index=190&type=chunk)[193](index=193&type=chunk) - Each Director has confirmed compliance with the required standards of the Model Code and the Company's code of conduct for the six months ended June 30, 2025[190](index=190&type=chunk)[193](index=193&type=chunk) - Senior management are also required to comply with the provisions of the Model Code and the Company's code of conduct[190](index=190&type=chunk)[194](index=194&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Shares](index=36&type=section&id=PURCHASE%2C%20SALE%20OR%20REDEMPTION%20OF%20THE%20COMPANY%27S%20LISTED%20SHARES) As of June 30, 2025, the Company held no treasury shares, and neither the Company nor its subsidiaries purchased, sold, or redeemed any listed shares during the period - As of June 30, 2025, the Company held no treasury shares[195](index=195&type=chunk) - 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 shares[195](index=195&type=chunk) [Corporate Governance Practices](index=37&type=section&id=CORPORATE%20GOVERNANCE%20PRACTICES) The Board confirms that the Company has complied with the Corporate Governance Code set out in Part 2 of Appendix C1 to the Listing Rules for the six months ended June 30, 2025 - The Board confirms that the Company has complied with the Corporate Governance Code set out in Part 2 of Appendix C1 to the Listing Rules for the six months ended June 30, 2025[196](index=196&type=chunk)[200](index=200&type=chunk) [Nomination Committee](index=37&type=section&id=NOMINATION%20COMMITTEE) The Nomination Committee, chaired by Executive Director Mr. Liu Yang and including two independent non-executive directors, did not hold any meetings during the period - The Nomination Committee is chaired by Executive Director Mr. Liu Yang, with members including independent non-executive directors Mr. Liang Jinyun and Mr. Liu Chenguang[197](index=197&type=chunk)[201](index=201&type=chunk) - The Nomination Committee did not hold any meetings during the review period[197](index=197&type=chunk)[201](index=201&type=chunk) [Remuneration Committee](index=37&type=section&id=REMUNERATION%20COMMITTEE) The Remuneration Committee, chaired by Independent Non-executive Director Mr. Liu Chenguang and comprising three other members, did not hold any meetings during the period - The Remuneration Committee is chaired by Independent Non-executive Director Mr. Liu Chenguang, with members including independent non-executive directors Mr. Liang Jinyun, Ms. Shan Honghong, and Executive Director Mr. Liu Yang[198](index=198&type=chunk)[202](index=202&type=chunk) - The Remuneration Committee did not hold any meetings during the review period[198](index=198&type=chunk)[202](index=202&type=chunk) [Audit Committee](index=37&type=section&id=AUDIT%20COMMITTEE) The Audit Committee, composed of three independent non-executive directors, reviewed the company's accounting principles, internal controls, financial reporting, and compliance matters during the period, communicating with independent auditors and raising no objections to accounting treatments - The Audit Committee comprises three independent non-executive directors, including Chairman Mr. Liang Jinyun, Mr. Liu Chenguang, and Ms. Shan Honghong[199](index=199&type=chunk)[203](index=203&type=chunk) - During the period, the Audit Committee reviewed the Company's accounting principles and practices, Listing Rules, internal controls, statutory requirements, and compliance matters related to financial reporting[199](index=199&type=chunk)[203](index=203&type=chunk) - The Audit Committee has reviewed the unaudited condensed financial information and raised no objections to the accounting treatments adopted by the Company during the review period[199](index=199&type=chunk)[203](index=203&type=chunk)

[Unaudited Interim Results](index=3&type=section&id=Unaudited%20Interim%20Results) This section presents the unaudited interim financial performance for the first half of 2025, showing key financial indicators and their year-over-year changes | Indicator | H1 2025 (RMB billion) | H1 2024 (RMB billion) | Change Rate | | :--- | :--- | :--- | :--- | | Operating Revenue | 6.845 | 6.626 | +3.30% | | Profit Before Tax | 2.358 | 2.326 | +1.37% | | Profit Attributable to Owners of the Parent | 1.688 | 1.765 | -4.37% | | Basic and Diluted Earnings Per Share (RMB) | 0.2046 | 0.2111 | -0.0065 | [Financial Highlights](index=4&type=section&id=Financial%20Highlights) This section provides a summary of the Group's financial performance and position for the first half of 2025, including income statement and balance sheet data Summary of Income Statement for the Six Months Ended June 30, 2025 (RMB thousand) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 6,844,711 | 6,626,095 | | Operating Profit | 3,078,817 | 3,123,565 | | Profit Before Tax | 2,358,408 | 2,326,498 | | Profit for the Period | 1,908,764 | 1,981,176 | | Attributable to Owners of the Parent | 1,688,318 | 1,765,451 | | Attributable to Non-controlling Interests | 220,446 | 215,725 | | Basic and Diluted Earnings Per Share (RMB/share) | 0.2046 | 0.2111 | Summary of Statement of Financial Position as of June 30, 2025 (RMB thousand) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Non-current Assets | 88,154,925 | 90,596,458 | | Total Current Assets | 28,276,941 | 24,948,074 | | Total Assets | 116,431,866 | 115,544,532 | | Total Current Liabilities | 24,737,401 | 32,065,608 | | Total Non-current Liabilities | 52,883,049 | 45,904,771 | | Total Liabilities | 77,620,450 | 77,970,379 | | Equity Attributable to Owners of the Parent | 34,197,709 | 33,216,309 | | Total Equity | 38,811,416 | 37,574,153 | [Management Discussion and Analysis](index=6&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the Group's operational performance, financial condition, industry trends, and future outlook for the reporting period [Industry Overview](index=6&type=section&id=Industry%20Overview) In the first half of 2025, China's renewable energy sector saw significant growth in installed capacity and power generation, with policy shifts towards market-driven development and green power direct connection National Renewable Energy Newly Installed Capacity in H1 2025 | Energy Type | Newly Installed Capacity (MW) | Year-on-year Growth | | :--- | :--- | :--- | | Hydropower | 3,930 | - | | Wind Power | 51,390 | - | | Solar Power | 212,000 | - | | Biomass Power | 710 | - | | **Total** | **268,030** | **99.3%** | National Renewable Energy Total Installed Capacity as of June End 2025 | Energy Type | Total Installed Capacity (GW) | Year-on-year Growth | | :--- | :--- | :--- | | Hydropower | 440 | - | | Wind Power | 573 | - | | Solar Power | 1,100 | - | | Biomass Power | 47 | - | | **Total** | **2,159** | **30.6%** | National Renewable Energy Power Generation in H1 2025 | Indicator | Power Generation (GWh) | Year-on-year Growth | | :--- | :--- | :--- | | Renewable Energy Power Generation | 1,799.3 | 15.6% | | Total Wind and Solar Power Generation | 1,147.8 | 27.4% | - The National Development and Reform Commission and National Energy Administration issued "Document No. 136," emphasizing that new energy projects' on-grid electricity should primarily enter the power market, shifting new energy from **"guaranteed volume and price" to "market-driven"**[10](index=10&type=chunk) - "Document No. 394" explicitly canceled mandatory energy storage requirements for new energy projects, promoting storage from **"administrative allocation" to market-based competition**, and requiring user-side entities to directly participate in the spot market by the end of 2025[11](index=11&type=chunk) - "Document No. 650" systematically promotes green power direct connection, innovating the new energy **"source-load direct connection" model** to address grid investment and new energy curtailment pressures, unlocking greater potential for new energy development[13](index=13&type=chunk) [Business Review](index=9&type=section&id=Business%20Review) In the first half of 2025, the Group achieved steady progress in safety, operations, resource acquisition, cost control, and market value management, with significant growth in installed capacity and power generation Key Operating Indicators of the Group in H1 2025 | Indicator | June 30, 2025 | H1 2024/Dec 31, 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Controlled Installed Capacity | 19,068.60 MW | 15,554.72 MW | +22.59% | | Power Generation | 18,875,826 MWh | 17,125,208 MWh | +10.22% | | Construction Project Quotas Acquired | 2,250.00 MW | - | - | | Total Assets | RMB 116.432 billion | RMB 115.545 billion | +0.77% | | Asset-Liability Ratio | 66.67% | 67.50% | -0.83 percentage points | [Continuously Strengthening the Foundation of Safe Production](index=9&type=section&id=Continuously%20Strengthening%20the%20Foundation%20of%20Safe%20Production) The Group prioritized safety and environmental protection in H1 2025, achieving no major safety accidents, increasing wind and solar power generation, and maintaining above-average wind power utilization hours - In the first half of 2025, the Group experienced **no general or above-level safety production accidents** and continued to carry out a series of "Safety Production Month" activities[15](index=15&type=chunk) Group's Wind and Solar Power Generation in H1 2025 | Generation Type | H1 2025 (MWh) | H1 2024 (MWh) | Increase | | :--- | :--- | :--- | :--- | | Wind Power | 16,492,913 | 15,248,508 | 8.16% | | Solar Power | 2,382,914 | 1,876,700 | 26.97% | | **Total** | **18,875,826** | **17,125,208** | **10.22%** | Group's Average Utilization Hours in H1 2025 (Hours) | Generation Type | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Total | 999 | 1,104 | -105 | | Wind Power | 1,138 | 1,167 | -29 | | Solar Power | 542 | 770 | -228 | - The Group's wind power average utilization hours were **1,138 hours**, a decrease of 29 hours year-on-year, but still **51 hours higher than the industry average**[20](index=20&type=chunk) - The Group's solar power average utilization hours were **542 hours**, a decrease of 228 hours year-on-year, but generally **on par with the industry average**[20](index=20&type=chunk) [Focusing on Growth to Promote High-Quality Development](index=17&type=section&id=Focusing%20on%20Growth%20to%20Promote%20High-Quality%20Development) The Group actively acquired new energy project resources, securing 2,250.00 MW of construction quotas, and increased controlled installed capacity by 22.59% to 19,068.60 MW by June 30, 2025, with significant solar capacity growth - In the first half of 2025, the Group cumulatively acquired construction quotas of **2,250.00 MW** in regions including Fujian, Xinjiang, Qinghai, and Gansu[25](index=25&type=chunk) Controlled Installed Capacity as of June 30, 2025 (MW) | Generation Type | June 30, 2025 | June 30, 2024 | Year-on-year Change | Year-on-year Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total | 19,068.60 | 15,554.72 | 3,513.88 | 22.59% | | Wind Power | 14,516.30 | 13,114.20 | 1,402.10 | 10.69% | | Solar Power | 4,552.30 | 2,440.52 | 2,111.78 | 86.53% | - The Group scientifically formulated its "15th Five-Year Plan" development strategy, continuously monitoring national guiding policies and provincial implementation rules for the new energy industry[34](index=34&type=chunk) [Multiple Measures to Enhance Management Efficiency](index=21&type=section&id=Multiple%20Measures%20to%20Enhance%20Management%20Efficiency) The Group optimized its debt structure by issuing perpetual bonds, reducing average financing costs to 2.48% and decreasing financial expenses by 12.71%, while also advancing technological innovation and market-oriented power marketing - The Group issued perpetual bonds of **RMB 3 billion** with a weighted coupon rate of **1.92%**, a new historical low for the company[35](index=35&type=chunk) - The company's average financing cost rate reached **2.48%**, a **36 basis point reduction** from 2.84% at the beginning of the year[35](index=35&type=chunk) - Finance costs were **RMB 722.49 million**, a year-on-year decrease of **RMB 105 million**, representing a **12.71% reduction**[35](index=35&type=chunk) - The Group determined the direction for technological innovation for the "15th Five-Year Plan" and explored establishing a technology innovation platform to continuously improve technology management[37](index=37&type=chunk) - The "volume-price synergy" management model was upgraded to coordinate medium-to-long-term, spot, and ancillary service markets, maximizing the temporal and spatial value of electricity[38](index=38&type=chunk) [Focusing on Market Value Management to Improve Listed Company Quality](index=23&type=section&id=Focusing%20on%20Market%20Value%20Management%20to%20Improve%20Listed%20Company%20Quality) The Group's share price increased by 17.31% in H1 2025, outperforming the Hang Seng Composite Utilities Index, while actively engaging investors, attracting new shareholders, and strengthening compliance management - As of June 30, 2025, the company's share price was **HKD 2.38**, an increase of **HKD 0.35** from the beginning of the year, representing a **17.31% growth** and outperforming the Hang Seng Composite Utilities Index[39](index=39&type=chunk) - In the first half of 2025, the Group held **40 investor conferences**, communicating with over 200 individuals, and successfully attracted China Great Wall Life Insurance Co., Ltd. as a shareholder[40](index=40&type=chunk) - The Group continuously strengthened management of related party transactions and inside information, organizing training for 108 compliance management personnel[41](index=41&type=chunk) [Strengthening Political Leadership and Comprehensively Enhancing Party Building](index=24&type=section&id=Strengthening%20Political%20Leadership%20and%20Comprehensively%20Enhancing%20Party%20Building) The Group prioritized political building, conducted "First Topic" studies, implemented 76 measures for comprehensive strict Party governance, and advanced anti-corruption efforts while coordinating Party, publicity, united front, and mass work - The Group prioritized the Party's political building, conducted **10 "First Topic" studies**, and formulated **76 specific implementation measures**[43](index=43&type=chunk) - The Group solidly advanced comprehensive strict Party governance, formulating implementation measures and responsibility lists for fulfilling the primary responsibility of comprehensive strict Party governance[43](index=43&type=chunk) [Financial Position and Operating Results](index=24&type=section&id=Financial%20Position%20and%20Operating%20Results) The Group's net profit and profit attributable to owners of the parent decreased in H1 2025 due to lower electricity prices and increased operating expenses, despite a 3.30% revenue growth, while financial expenses significantly declined [Overview](index=24&type=section&id=Overview) For the six months ended June 30, 2025, the Group's net profit was RMB 1.909 billion, a decrease of RMB 72.41 million, and profit attributable to owners of the parent was RMB 1.688 billion, a decrease of RMB 77.13 million Net Profit Overview in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Profit for the Period | 1,908.76 | 1,981.18 | -72.42 | | Profit Attributable to Owners of the Parent | 1,688.32 | 1,765.45 | -77.13 | [Revenue](index=25&type=section&id=Revenue) For the six months ended June 30, 2025, the Group's revenue increased by 3.30% to RMB 6.845 billion, primarily driven by higher electricity sales Revenue Composition in H1 2025 (RMB million) | Revenue Type | H1 2025 | H1 2024 | Increase | | :--- | :--- | :--- | :--- | | Total Revenue | 6,844.71 | 6,626.10 | 3.30% | | Electricity Sales Revenue | 6,778.39 | 6,578.67 | 3.04% | | Other Service Income | 66.32 | - | - | [Other Income, Gains and Losses, Net](index=25&type=section&id=Other%20Income%2C%20Gains%20and%20Losses%2C%20Net) For the six months ended June 30, 2025, the Group's other income, gains and losses, net, increased to RMB 256.46 million, mainly due to an 11.55% rise in government grants, including increased VAT refunds Other Income, Gains and Losses, Net in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Other Income, Gains and Losses, Net | 256.46 | 208.85 | | Government Grants | 226.68 | 203.20 | [Operating Expenses](index=26&type=section&id=Operating%20Expenses) For the six months ended June 30, 2025, the Group's operating expenses increased by 8.38% to RMB 4.022 billion, primarily due to a 6.39% increase in depreciation of property, plant, and equipment from higher installed capacity Operating Expenses and Depreciation & Amortization in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Increase | | :--- | :--- | :--- | :--- | | Operating Expenses | 4,022.36 | 3,711.38 | 8.38% | | Depreciation and Amortization Expenses | 2,906.13 | 2,731.48 | 6.39% | [Operating Profit](index=26&type=section&id=Operating%20Profit) For the six months ended June 30, 2025, the Group's operating profit decreased by 1.43% to RMB 3.079 billion, primarily due to the increase in operating expenses Operating Profit in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Decrease | | :--- | :--- | :--- | :--- | | Operating Profit | 3,078.82 | 3,123.56 | 1.43% | [Finance Income](index=26&type=section&id=Finance%20Income) For the six months ended June 30, 2025, the Group's finance income decreased by 71.51% to RMB 2.15 million, mainly due to a reduction in average cash and bank balances Finance Income in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Decrease | | :--- | :--- | :--- | :--- | | Finance Income | 2.15 | 7.54 | 71.51% | [Finance Costs](index=27&type=section&id=Finance%20Costs) For the six months ended June 30, 2025, the Group's finance costs decreased by 12.71% to RMB 722.49 million, primarily due to lower financing costs during the period Finance Costs in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Decrease | | :--- | :--- | :--- | :--- | | Finance Costs | 722.49 | 827.73 | 12.71% | [Share of Profits of Associates and Joint Ventures](index=27&type=section&id=Share%20of%20Profits%20of%20Associates%20and%20Joint%20Ventures) For the six months ended June 30, 2025, the Group's share of profits from associates and joint ventures was RMB -0.07 million, a significant decrease from RMB 23.12 million in the prior year Share of Profits of Associates and Joint Ventures in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Share of Profits of Associates and Joint Ventures | -0.07 | 23.12 | [Income Tax Expense](index=27&type=section&id=Income%20Tax%20Expense) For the six months ended June 30, 2025, the Group's income tax expense increased by 30.21% to RMB 449.64 million, mainly due to profit fluctuations in subsidiaries and the impact of income tax preferential policies Income Tax Expense in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Increase | | :--- | :--- | :--- | :--- | | Income Tax Expense | 449.64 | 345.32 | 30.21% | [Profit for the Period](index=27&type=section&id=Profit%20for%20the%20Period) For the six months ended June 30, 2025, the Group's profit for the period was RMB 1.909 billion, a decrease of RMB 72.42 million, with the net profit margin declining to 27.89% due to lower electricity prices and increased operating expenses Profit for the Period and Net Profit Margin in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Profit for the Period | 1,908.76 | 1,981.18 | -72.42 | | Net Profit Margin | 27.89% | 29.90% | -2.01 percentage points | [Profit Attributable to Owners of the Parent](index=28&type=section&id=Profit%20Attributable%20to%20Owners%20of%20the%20Parent) For the six months ended June 30, 2025, the profit attributable to owners of the parent was RMB 1.688 billion, a decrease of RMB 77.13 million Profit Attributable to Owners of the Parent in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Profit Attributable to Owners of the Parent | 1,688.32 | 1,765.45 | -77.13 | [Profit Attributable to Non-controlling Interests](index=28&type=section&id=Profit%20Attributable%20to%20Non-controlling%20Interests) For the six months ended June 30, 2025, the profit attributable to non-controlling interests was RMB 220.45 million, an increase of 2.19% Profit Attributable to Non-controlling Interests in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Increase | | :--- | :--- | :--- | :--- | | Profit Attributable to Non-controlling Interests | 220.45 | 215.73 | 2.19% | [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the Group maintained ample liquidity with RMB 56.982 billion in unutilized bank facilities and RMB 13 billion in registered but unissued corporate bonds, while total borrowings increased by 1.22% to RMB 69.091 billion - As of June 30, 2025, the Group had committed unutilized bank facilities of no less than **RMB 56.982 billion**[58](index=58&type=chunk) - As of June 30, 2025, the Group had registered but unissued corporate bond quotas of **RMB 13 billion**[58](index=58&type=chunk) Borrowing Composition as of June 30, 2025 (RMB million) | Borrowing Type | June 30, 2025 | December 31, 2024 | Increase | | :--- | :--- | :--- | :--- | | Total Borrowings | 69,090.69 | 68,259.92 | 1.22% | | Short-term Borrowings | 16,459.69 | - | - | | Long-term Borrowings | 52,631.00 | - | - | [Capital Expenditures](index=29&type=section&id=Capital%20Expenditures) For the six months ended June 30, 2025, the Group's capital expenditures decreased by 37.43% to RMB 2.554 billion, primarily for the acquisition of property, plant, and equipment, right-of-use assets, and intangible assets Capital Expenditures in H1 2025 (RMB million) | Indicator | H1 2025 | H1 2024 | Decrease | | :--- | :--- | :--- | :--- | | Capital Expenditures | 2,553.57 | 4,081.24 | 37.43% | [Net Debt to Capital Ratio](index=29&type=section&id=Net%20Debt%20to%20Capital%20Ratio) As of June 30, 2025, the Group's net debt to capital ratio was 63.31%, a decrease of 0.53 percentage points from 63.83% at December 31, 2024, mainly due to retained earnings Net Debt to Capital Ratio | Indicator | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Net Debt to Capital Ratio | 63.31% | 63.83% | -0.53 percentage points | [Significant Investments](index=29&type=section&id=Significant%20Investments) For the six months ended June 30, 2025, the Group had no significant investments[62](index=62&type=chunk) [Significant Acquisitions and Disposals](index=29&type=section&id=Significant%20Acquisitions%20and%20Disposals) For the six months ended June 30, 2025, the Group had no significant acquisitions or disposals[63](index=63&type=chunk) [Pledge of Assets](index=30&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, certain Group loans were secured by property, plant and equipment, electricity tariff receivables, and concession assets, with a total net book value of RMB 11.862 billion Total Net Book Value of Pledged Assets as of June 30, 2025 (RMB million) | Type of Pledged Assets | June 30, 2025 | | :--- | :--- | | Property, Plant and Equipment | 1,326.57 (Bank Borrowings) + 2,466.28 (Other Borrowings) | | Electricity Tariff Receivables | 6,535.98 (Bank Borrowings) + 1,533.37 (Other Borrowings) | | **Total** | **11,862.20** | [Contingent Liabilities](index=30&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities[66](index=66&type=chunk) [Risk Factors and Risk Management](index=30&type=section&id=Risk%20Factors%20and%20Risk%20Management) The Group faces multiple risks including policy, curtailment, competition, climate, and interest rate fluctuations, which it addresses through policy monitoring, grid coordination, resource expansion, geographical diversification, and diversified financing - Policy Risk: Ongoing power market reforms expose new energy enterprises to risks of **declining electricity prices and reduced returns**[67](index=67&type=chunk) - Curtailment Risk: Mismatches between new electricity demand and rapid growth in new energy generation may lead to **inability to fully absorb full-load generation** from power projects[68](index=68&type=chunk) - Competition Risk: The increasing number of investors developing new energy projects in China intensifies competition, requiring the company to strategically plan, **consolidate resource reserves, and enhance core competitiveness**[69](index=69&type=chunk) - Climate Risk: Wind power generation is affected by fluctuations in wind resources, which the company mitigates by having **power generation projects across 27 provinces** and regions nationwide[70](index=70&type=chunk) - Interest Rate Risk: Fluctuations in bank loan interest rates impact project costs and finance expenses, which the company addresses by **diversifying funding sources and using appropriate financing tenors** to smooth out the impact[71](index=71&type=chunk) [Business Outlook for H2 2025](index=32&type=section&id=Business%20Outlook%20for%20H2%202025) In the second half of 2025, the Group plans to strengthen operational management, achieve annual targets, accelerate quality project development, enhance market value management, deepen reforms, and leverage Party building for overall guidance - The Group will comprehensively strengthen operational management, including deepening benchmark management, enhancing curtailment management, power marketing, and cost control, to **fully achieve all annual targets**[73](index=73&type=chunk) - The Group will vigorously promote the development of high-quality projects, enhance resource acquisition capabilities, accelerate the completion of the "14th Five-Year Plan," and **scientifically formulate the "15th Five-Year Plan"**[74](index=74&type=chunk) - The Group will focus on strengthening market value management, formulating capital operation action plans, deepening investor relations management, and **improving the governance level of the listed company**[75](index=75&type=chunk) - The Group will adhere to deepening reforms, promoting the implementation of a modern enterprise system with Chinese characteristics, and **improving risk prevention and control mechanisms**[76](index=76&type=chunk) - The Group will maintain a high political stance, leverage the guiding and safeguarding role of Party building, and **deepen comprehensive strict Party governance**[77](index=77&type=chunk) [Human Resources](index=34&type=section&id=Human%20Resources) As of June 30, 2025, the Group employed 4,064 staff, with the 30-39 age group being the largest, and implemented a performance-based compensation system, achieving 100% training coverage while adhering to labor laws Employee Age Distribution as of June 30, 2025 | Age Group | Number of Employees (persons) | Percentage | | :--- | :--- | :--- | | 50 years and above | 527 | 12.96% | | 40 to 49 years | 562 | 13.83% | | 30 to 39 years | 1,683 | 41.41% | | 30 years or below | 1,292 | 31.79% | | **Total** | **4,064** | **100%** | - The Group implements a compensation system primarily based on **position-based salaries** and has established a comprehensive performance appraisal system for all employees to stimulate their potential and work enthusiasm[80](index=80&type=chunk)[81](index=81&type=chunk) - As of June 30, 2025, the Group's **overall employee training rate reached 100%**, with both male and female employees receiving an average of **55 hours of training per person**[82](index=82&type=chunk) - The Group strictly complies with the "Labor Law of the People's Republic of China" and the "Labor Contract Law," legally paying social insurance and housing provident funds for its employees[83](index=83&type=chunk) [Other Information](index=36&type=section&id=Other%20Information) This section covers the company's share capital, interim dividend proposal, withholding tax arrangements for overseas shareholders, stable major shareholder interests, absence of significant litigation, corporate governance compliance, and audit committee review - As of June 30, 2025, the company's total share capital was **7,273,701,000 shares**, with a par value of **RMB 1.00 per share**[85](index=85&type=chunk) - The Board of Directors proposed to distribute a 2025 interim dividend of **RMB 0.03 cash dividend per share** (pre-tax) to shareholders[86](index=86&type=chunk) - The company will **withhold and pay enterprise income tax at a rate of 10%** when distributing interim dividends to overseas H-share non-resident enterprise shareholders[88](index=88&type=chunk) Major Shareholders' Interests in Shares as of June 30, 2025 | Shareholder Name | Share Class | Capacity | Number of Shares/Relevant Shares Held (Long Position) | Percentage of Relevant Share Class | Percentage of Total Share Capital | | :--- | :--- | :--- | :--- | :--- | :--- | | Datang Group | Domestic Shares | Beneficial Owner and Interests of Controlled Corporations | 4,772,629,900 | 100% | 65.61% | | China Hydropower and Water Resources Material Group Co., Ltd. | Domestic Shares | Beneficial Owner | 599,374,505 | 12.56% | 8.24% | | Baoshan Iron & Steel Co., Ltd. | H-shares | Interests of Controlled Corporations | 164,648,000 | 6.58% | 2.26% | | Bao-Trans Enterprises Limited | H-shares | Beneficial Owner | 164,648,000 | 6.58% | 2.26% | | Shanghai Ningquan Asset Management Co., Ltd. | H-shares | Investment Manager | 251,979,000 | 10.07% | 3.46% | | China Great Wall Life Insurance Co., Ltd. | H-shares | Beneficial Owner | 361,000,000 | 14.43% | 4.96% | - On April 30, 2025, Mr. Bai Li was appointed as a non-executive director of the company[101](index=101&type=chunk) - For the six months ended June 30, 2025, neither the company nor any of its subsidiaries repurchased, sold, or redeemed any listed securities[98](index=98&type=chunk) - The company issued several notes and bonds during the reporting period, with proceeds used to repay interest-bearing debts or replace funds used to repay corporate bonds[103](index=103&type=chunk) - As of June 30, 2025, the company was not involved in any significant litigation or arbitration[105](index=105&type=chunk) - The company has strictly complied with the Corporate Governance Code in Appendix C1 of the Listing Rules, with the exception of a deviation from Code Provision C.1.7 (no liability insurance purchased for directors)[107](index=107&type=chunk) - The Audit Committee has reviewed the company's unaudited interim condensed consolidated financial statements and the 2025 interim report for the six months ended June 30, 2025[110](index=110&type=chunk) [Interim Condensed Consolidated Statement of Profit or Loss](index=45&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) This statement shows that for the six months ended June 30, 2025, the company reported RMB 6.845 billion in revenue, RMB 3.079 billion in operating profit, RMB 1.909 billion in profit for the period, and RMB 1.688 billion in profit attributable to owners of the parent Key Data from Interim Condensed Consolidated Statement of Profit or Loss (RMB thousand) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 6,844,711 | 6,626,095 | | Operating Profit | 3,078,817 | 3,123,565 | | Profit Before Tax | 2,358,408 | 2,326,498 | | Profit for the Period | 1,908,764 | 1,981,176 | | Attributable to Owners of the Parent | 1,688,318 | 1,765,451 | | Attributable to Non-controlling Interests | 220,446 | 215,725 | | Basic and Diluted Earnings Per Share Attributable to Ordinary Equity Holders of the Parent (RMB) | 0.2046 | 0.2111 | [Interim Condensed Consolidated Statement of Comprehensive Income](index=47&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) This statement indicates that for the six months ended June 30, 2025, the profit for the period was RMB 1.909 billion, with other comprehensive expenses, net, of RMB 0.328 million, resulting in a total comprehensive income of RMB 1.908 billion Key Data from Interim Condensed Consolidated Statement of Comprehensive Income (RMB thousand) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Profit for the Period | 1,908,764 | 1,981,176 | | Other Comprehensive (Expense)/Income | (328) | 110 | | Total Comprehensive Income for the Period | 1,908,436 | 1,981,286 | | Attributable to Owners of the Parent | 1,688,020 | 1,765,546 | | Attributable to Non-controlling Interests | 220,416 | 215,740 | [Interim Condensed Consolidated Statement of Financial Position](index=48&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were RMB 116.432 billion, total liabilities were RMB 77.620 billion, and total equity was RMB 38.811 billion, with a slight decrease in non-current assets and an increase in current assets Key Data from Interim Condensed Consolidated Statement of Financial Position (RMB thousand) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Non-current Assets | 88,154,925 | 90,596,458 | | Total Current Assets | 28,276,941 | 24,948,074 | | Total Assets | 116,431,866 | 115,544,532 | | Total Current Liabilities | 24,737,401 | 32,065,608 | | Total Non-current Liabilities | 52,883,049 | 45,904,771 | | Total Liabilities | 77,620,450 | 77,970,379 | | Equity Attributable to Owners of the Parent | 34,197,709 | 33,216,309 | | Total Equity | 38,811,416 | 37,574,153 | [Interim Condensed Consolidated Statement of Changes in Equity](index=50&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, the Group's total equity increased from RMB 37.574 billion to RMB 38.811 billion, primarily due to comprehensive income, issuance and repayment of perpetual notes, and dividend declarations Overview of Changes in Equity in H1 2025 (RMB thousand) | Equity Item | January 1, 2025 (Audited) | Total Comprehensive Income for the Period | Issuance of Perpetual Notes and Bonds | Repayment of Perpetual Notes and Bonds | Declaration of 2024 Final Dividend | Other Changes | June 30, 2025 (Unaudited) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Equity Attributable to Owners of the Parent | 33,216,309 | 1,688,020 | 3,000,000 | (3,000,000) | (436,422) | (269,200) | 34,197,709 | | Non-controlling Interests | 4,357,844 | 220,416 | - | - | - | 35,437 | 4,613,707 | | **Total Equity** | **37,574,153** | **1,908,436** | **3,000,000** | **(3,000,000)** | **(436,422)** | **(234,751)** | **38,811,416** | [Interim Condensed Consolidated Statement of Cash Flows](index=53&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, the Group generated RMB 3.122 billion from operating activities, used RMB 2.558 billion in investing activities, and used RMB 374.27 million in financing activities, resulting in cash and cash equivalents of RMB 2.134 billion at period-end Key Data from Interim Condensed Consolidated Statement of Cash Flows (RMB thousand) | Cash Flow Type | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 3,122,033 | 1,773,329 | | Net Cash Used in Investing Activities | (2,557,603) | (4,099,544) | | Net Cash (Used in)/Generated from Financing Activities | (374,271) | 1,708,652 | | Net Increase/(Decrease) in Cash and Cash Equivalents | 190,159 | (617,563) | | Cash and Cash Equivalents at End of Period | 2,134,331 | 2,438,366 | [Notes to the Interim Condensed Consolidated Financial Information](index=55&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section provides supplementary information to the interim condensed consolidated financial statements, detailing accounting policies, financial instrument fair values, segment information, revenue and expense breakdowns, dividend policy, asset and liability composition, borrowings, related party transactions, and post-reporting period events - This interim condensed consolidated financial information has been prepared in accordance with **International Accounting Standard 34 "Interim Financial Reporting"** and on a **going concern basis**[131](index=131&type=chunk)[135](index=135&type=chunk) - The Group's wind power generation business revenue fluctuates throughout the year due to **more favorable wind speeds in spring and winter**[139](index=139&type=chunk) - As of June 30, 2025, the Group had committed unutilized bank facilities of no less than **RMB 56.982 billion**[136](index=136&type=chunk) - The Group's accounts receivable and bills receivable primarily consist of electricity tariff income due from regional or provincial power grid companies, with **electricity price subsidies fully recoverable**[187](index=187&type=chunk) - The Group has several significant related party transactions with Datang Group and its fellow subsidiaries, including **procurement of engineering services, material and equipment procurement, borrowings, and deposits**[204](index=204&type=chunk)[205](index=205&type=chunk)[207](index=207&type=chunk)[208](index=208&type=chunk)[209](index=209&type=chunk)[210](index=210&type=chunk)[211](index=211&type=chunk)[212](index=212&type=chunk) - The perpetual notes and bonds issued by the company have no fixed maturity date and are classified as equity, with subsequent interest payments treated as **distributions to equity holders**[214](index=214&type=chunk) - Subsequent to the reporting period, the company completed the issuance and redemption of multiple tranches of **medium-term notes and ultra-short-term financing bonds**, totaling several billion RMB[217](index=217&type=chunk)[219](index=219&type=chunk) [Definitions](index=109&type=section&id=Definitions) This chapter provides definitions for key terms and abbreviations used throughout the report, including "Average Utilization Hours," "Controlled Installed Capacity," "Controlled Power Generation," "Datang Group," "H-shares," and "RMB," to enhance reader comprehension - This chapter provides definitions for key terms such as **"Average Utilization Hours," "Controlled Installed Capacity," "Controlled Power Generation," "Datang Group," "H-shares," and "RMB"**[222](index=222&type=chunk)[223](index=223&type=chunk)[225](index=225&type=chunk) [Company Information](index=113&type=section&id=Company%20Information) This chapter provides essential company details, including legal name, registered office, principal place of business, legal representative, board of directors, board committees, auditors, legal advisors, principal bankers, H-share registrar, stock code, and investor contact information - The company's legal name is China Datang Corporation Renewable Power Co., Limited, and its **H-share stock code is 01798**[228](index=228&type=chunk)[235](index=235&type=chunk) - The Board of Directors includes executive, non-executive, and independent non-executive directors, and has an **Audit Committee, Nomination Committee, Remuneration and Appraisal Committee, and Strategy Committee**[230](index=230&type=chunk)[231](index=231&type=chunk) - The auditors are **Dahua Certified Public Accountants (Special General Partnership)** and **Dahua Mashiyun Certified Public Accountants Limited**[231](index=231&type=chunk)

公司資料 董事會 執行董事 桂常青女士 張澤軍先生 | | 頁次 | | --- | --- | | 公司資料 | 2 | | 管理層討論及分析 | 4 | | 企業管治及其他資料 | 13 | | 獨立審閱報告 | 29 | | 中期簡明綜合損益及其他全面收入表 | 31 | | 中期簡明綜合財務狀況表 | 33 | | 中期簡明綜合權益變動表 | 35 | | 中期簡明綜合現金流量表 | 37 | | 中期簡明綜合財務報表附註 | 39 | | 釋義 | 56 | 1 五谷磨房食品國際控股有限公司 目錄 審核委員會 張森泉先生（主席） 胡芃先生 歐陽良宜先生 薪酬委員會 胡芃先生（主席） 張森泉先生 歐陽良宜先生 提名委員會 歐陽良宜先生（主席） 桂常青女士 胡芃先生 非執行董事 謝長安女士 王鐸先生 獨立非執行董事 張森泉先生 胡芃先生 歐陽良宜先生 公司秘書 袁陞瑋先生，HKICPA 授權代表 張澤軍先生 袁陞瑋先生，HKICPA 上市地點及股份代號 香港聯合交易所有限公司 股份代號：01837 中華人民共和國總部 中國深圳市 南山區 粵海街道濱海社區 海天一路 8 號 百度國際大廈 西塔 7 層 香 ...

Corporate Information This section provides details on the company's board of directors, committees, auditor, registrars, stock code, and website [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) This chapter lists the company's board members and their positions, including chairman, managing director, executive, non-executive, and independent non-executive directors, along with committee compositions - The Board of Directors is chaired by Sun Yajie, with Fu Yao as Managing Director, Tian Gang as Executive Director, Huang Donglin as Non-executive Director, and Tam King Ching, Ng Man Fung, and An Yinlin as Independent Non-executive Directors[5](index=5&type=chunk) - The Audit Committee, Nomination Committee, and Remuneration Committee are all chaired by Independent Non-executive Director Tam King Ching[5](index=5&type=chunk)[6](index=6&type=chunk) [Auditor and Registrars](index=4&type=section&id=Auditor%20and%20Registrars) This chapter provides detailed information on the company's auditor, principal share registrar, Hong Kong branch share registrar, registered office, and website - The company's auditor is Shinewing (HK) CPA Limited[8](index=8&type=chunk) - The Hong Kong branch share registrar is Tricor Investor Services Limited[8](index=8&type=chunk) - The company's stock code is **730**, and its website is www.capital-ifs.com[10](index=10&type=chunk) Interim Results This section presents the condensed consolidated financial statements, including profit or loss, financial position, changes in equity, and cash flows for the interim period [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, total revenue significantly decreased by 56.3% to HK$47,822 thousand, while profit for the period increased by 4.7% to HK$27,493 thousand Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 47,822 | 109,452 | -56.3% | | Gross Profit | 40,799 | 57,723 | -29.3% | | Other Income | 11,094 | 5,253 | 111.2% | | Operating Profit | 35,970 | 35,052 | 2.6% | | Profit for the Period | 27,493 | 26,261 | 4.7% | | Profit Attributable to Owners of the Company | 19,838 | 17,981 | 10.3% | | Basic Earnings Per Share (HK cents) | 0.50 | 0.45 | 11.1% | - Revenue from sale and leaseback arrangements significantly decreased from **HK$93,805 thousand** to **HK$29,650 thousand**, primarily contributing to the decline in total revenue[13](index=13&type=chunk) - Impairment losses on financial assets reversed from a loss of **HK$559 thousand** in the prior period to a reversal of **HK$17,727 thousand** in the current period, positively impacting profit for the period[13](index=13&type=chunk) [Condensed Consolidated Statement of Financial Position](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, total assets slightly decreased by 0.2% to HK$1,863,590 thousand, with non-current assets growing significantly by 45.5% and total liabilities decreasing by 23.5% Key Data from Condensed Consolidated Statement of Financial Position | Indicator | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Non-current Assets | 909,294 | 624,742 | 45.5% | | Total Current Assets | 954,296 | 1,243,280 | -23.2% | | Total Assets | 1,863,590 | 1,868,022 | -0.2% | | Total Equity | 1,758,760 | 1,731,044 | 1.6% | | Total Non-current Liabilities | 20,613 | 21,749 | -5.3% | | Total Current Liabilities | 84,217 | 115,229 | -26.9% | | Total Liabilities | 104,830 | 136,978 | -23.5% | - Non-current portion of receivables under sale and leaseback arrangements increased from **HK$358,308 thousand** to **HK$648,501 thousand**, while the current portion decreased from **HK$566,938 thousand** to **HK$112,860 thousand**, reflecting business structure adjustments[17](index=17&type=chunk) - Cash and cash equivalents increased by **16.7%** to **HK$330,152 thousand**[17](index=17&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=9&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, total equity attributable to owners of the company increased by 2.0% to HK$1,423,097 thousand, driven by a significant 271.9% growth in total comprehensive income Key Data from Condensed Consolidated Statement of Changes in Equity | Indicator | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Equity and Reserves Attributable to Owners of the Company (End of Period) | 1,423,097 | 1,406,475 | 1.2% | | Profit for the Period | 19,838 | 17,981 | 10.3% | | Currency Translation Differences | 18,796 | (8,948) | 310.1% | | Total Comprehensive Income for the Period | 53,317 | 14,331 | 271.9% | | Dividends Declared | (11,862) | (15,890) | -25.3% | - Currency translation differences shifted from a loss of **HK$8,948 thousand** in the prior period to a gain of **HK$18,796 thousand** in the current period, significantly impacting comprehensive income positively[23](index=23&type=chunk) - The company repurchased and cancelled **903,000 shares** during the period for a total consideration of approximately **HK$99 thousand**[23](index=23&type=chunk)[116](index=116&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net increase in cash and cash equivalents was HK$44,122 thousand, primarily driven by net cash from operating activities Key Data from Condensed Consolidated Statement of Cash Flows | Indicator | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Net Cash from Operating Activities | 49,503 | 120,207 | -58.8% | | Net Cash from Investing Activities | 10,446 | 3,063 | 240.9% | | Net Cash Used in Financing Activities | (15,827) | (10,188) | 55.4% | | Net Increase in Cash and Cash Equivalents | 44,122 | 113,082 | -61.0% | | Cash and Cash Equivalents at End of Period | 330,152 | 430,886 | -23.4% | - Cash generated from operations decreased from **HK$134,026 thousand** to **HK$64,927 thousand**, leading to a significant reduction in net cash from operating activities[31](index=31&type=chunk) - Interest received increased from **HK$4,823 thousand** to **HK$11,018 thousand**, which is the primary reason for the increase in net cash from investing activities[31](index=31&type=chunk) Notes to the Condensed Consolidated Interim Financial Information This section provides detailed notes on the preparation basis, accounting policies, estimates, segment information, and other financial disclosures for the interim period [1 General Information](index=13&type=section&id=1%20General%20Information) The company is an investment holding company incorporated in Bermuda and listed in Hong Kong, with principal subsidiaries engaged in sale and leaseback, property leasing, and supply chain management businesses - The company's principal activities include providing sale and leaseback arrangement services, property leasing services, and supply chain management and financial technology businesses[33](index=33&type=chunk) - This condensed consolidated interim financial information is unaudited and presented in Hong Kong dollars[33](index=33&type=chunk)[37](index=37&type=chunk) [2 Basis of Preparation](index=13&type=section&id=2%20Basis%20of%20Preparation) This interim financial information is prepared in accordance with HKAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024 - This interim financial information has been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting"[34](index=34&type=chunk) - The company's functional currency is RMB, but the financial information is presented in Hong Kong dollars, with exchange differences recognized directly in other comprehensive income and accumulated translation reserve[35](index=35&type=chunk)[38](index=38&type=chunk) [3 Accounting Policies](index=14&type=section&id=3%20Accounting%20Policies) The accounting policies adopted are consistent with the previous financial year, with new and revised HKFRSs having no material impact on the group's financial performance or position - Accounting policies are consistent with those applied in the previous financial year and the corresponding interim reporting period, except for the adoption of new and revised standards and interpretations[39](index=39&type=chunk)[43](index=43&type=chunk) - The application of amendments to Hong Kong Financial Reporting Standards (e.g., HKAS 21 "Lack of Exchangeability") had no material impact on the financial performance and position for the current and prior periods[40](index=40&type=chunk)[44](index=44&type=chunk) [4 Estimates and Judgement](index=14&type=section&id=4%20Estimates%20and%20Judgement) The preparation of condensed consolidated interim financial information requires management's judgments, estimates, and assumptions consistent with those applied in the annual consolidated financial statements for the year ended December 31, 2024 - Significant management judgments in applying accounting policies and estimating uncertainties are consistent with those in the 2024 annual consolidated financial statements[41](index=41&type=chunk)[42](index=42&type=chunk)[45](index=45&type=chunk) [5 Segment Information](index=15&type=section&id=5%20Segment%20Information) The group operates in three segments: sale and leaseback, property leasing, and supply chain management, with varying revenue and performance trends for the six months ended June 30, 2025 - The group is divided into three operating segments: sale and leaseback arrangements business, property leasing business, and supply chain management and financial technology business[47](index=47&type=chunk)[50](index=50&type=chunk) Segment Revenue and Results (HK$'000) | Segment | Six Months Ended June 30, 2025 Revenue (HK$'000) | Six Months Ended June 30, 2024 Revenue (HK$'000) | Change (%) | Six Months Ended June 30, 2025 Results (HK$'000) | Six Months Ended June 30, 2024 Results (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Sale and Leaseback Arrangements Business | 29,650 | 93,805 | -68.4% | 38,525 | 39,219 | -1.8% | | Property Leasing Business | 2,023 | 2,134 | -5.2% | (6,494) | (264) | 2367.4% | | Supply Chain Management and Financial Technology Business | 16,149 | 13,513 | 19.5% | 3,699 | 4,135 | -10.5% | | **Total** | **47,822** | **109,452** | **-56.3%** | **35,730** | **43,090** | **-17.2%** | Segment Assets and Liabilities (HK$'000) | Segment | June 30, 2025 Assets (HK$'000) | December 31, 2024 Assets (HK$'000) | Change (%) | June 30, 2025 Liabilities (HK$'000) | December 31, 2024 Liabilities (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Sale and Leaseback Arrangements Business | 986,216 | 1,145,871 | -13.8% | 58,980 | 99,681 | -40.8% | | Supply Chain Management and Financial Technology Business | 96,307 | 94,540 | 1.9% | 5,018 | 9,640 | -48.0% | | Property Leasing Business | 94,191 | 101,220 | -7.0% | 129 | 44 | 193.2% | | **Total Segments** | **1,176,714** | **1,341,631** | **-12.3%** | **64,127** | **109,365** | **-41.3%** | [6 Other Income](index=19&type=section&id=6%20Other%20Income) For the six months ended June 30, 2025, the group's other income significantly increased by 111.2% to HK$11,094 thousand, primarily due to a substantial rise in credit financing arrangement income from a related party Other Income Details (HK$'000) | Income Category | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Interest income from bank deposits | 184 | 593 | -69.0% | | Interest income from deposit services from a related party | 864 | 294 | 193.9% | | Income from credit financing arrangements from a related party | 9,970 | 3,936 | 153.3% | | Others | 76 | 430 | -82.3% | | **Total** | **11,094** | **5,253** | **111.2%** | - Income from credit financing arrangements from a related party was the primary driver of other income growth, increasing from **HK$3,936 thousand** to **HK$9,970 thousand**[59](index=59&type=chunk) [7 Profit for the Period](index=20&type=section&id=7%20Profit%20for%20the%20Period) Profit for the period is stated after deducting expenses such as employee benefits, depreciation of property, plant and equipment, amortization of intangible assets, and depreciation of right-of-use assets Profit for the Period Deductions (HK$'000) | Item | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Employee benefit expenses | 20,831 | 22,460 | -7.2% | | Depreciation of property, plant and equipment | 182 | 163 | 11.7% | | Amortisation of intangible assets | 1,472 | 1,126 | 30.7% | | Depreciation of right-of-use assets | 1,863 | 1,885 | -1.2% | - Employee benefit expenses decreased by **7.2%** from **HK$22,460 thousand** to **HK$20,831 thousand**[63](index=63&type=chunk) - Amortisation of intangible assets increased by **30.7%** from **HK$1,126 thousand** to **HK$1,472 thousand**[63](index=63&type=chunk) [8 Finance Costs](index=20&type=section&id=8%20Finance%20Costs) For the six months ended June 30, 2025, the group's finance costs decreased by 44.1% to HK$326 thousand, primarily due to reductions in interest on loans from related parties and lease liabilities Finance Costs Details (HK$'000) | Item | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Interest on loans from a related party | 217 | 373 | -41.8% | | Interest on lease liabilities | 109 | 210 | -48.1% | | **Total** | **326** | **583** | **-44.1%** | - Interest on loans from a related party decreased by **41.8%** from **HK$373 thousand** to **HK$217 thousand**[65](index=65&type=chunk) [9 Income Tax Expenses](index=21&type=section&id=9%20Income%20Tax%20Expenses) For the six months ended June 30, 2025, the group's income tax expenses decreased by 11.7% to HK$9,505 thousand, primarily due to reduced current tax and a positive shift in deferred income tax Income Tax Expenses Details (HK$'000) | Item | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Current tax: PRC Enterprise Income Tax | 9,577 | 12,000 | -20.2% | | Deferred income tax | (72) | (1,236) | -94.2% | | **Income tax expenses** | **9,505** | **10,764** | **-11.7%** | - The PRC Enterprise Income Tax rate is **25%**, and the Hong Kong Profits Tax rate is **16.5%**, consistent with the prior period[67](index=67&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) [10 Dividends](index=21&type=section&id=10%20Dividends) The company approved a final dividend of HK$0.003 per share for the year ended December 31, 2024, totaling approximately HK$11,862 thousand, with no interim dividends declared for the current or prior period - The final dividend for FY2024 was **HK$0.003 per ordinary share**, totaling approximately **HK$11,862 thousand**, a decrease from **HK$15,890 thousand** in FY2023[68](index=68&type=chunk)[70](index=70&type=chunk) - No interim dividends were paid or declared for the six months ended June 30, 2025, or 2024[69](index=69&type=chunk)[70](index=70&type=chunk) [11 Earnings Per Share](index=22&type=section&id=11%20Earnings%20Per%20Share) For the six months ended June 30, 2025, basic earnings per share attributable to owners of the company increased to 0.50 HK cents from 0.45 HK cents in the prior period, with no diluted earnings per share Earnings Per Share Data | Indicator | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Profit Attributable to Owners of the Company (HK$'000) | 19,838 | 17,981 | 10.3% | | Weighted Average Number of Ordinary Shares (thousands) | 3,953,963 | 3,973,037 | -0.5% | | Basic Earnings Per Share (HK cents) | 0.50 | 0.45 | 11.1% | - There were no diluted earnings per share for the six months ended June 30, 2025, and 2024, as there were no potential dilutive ordinary shares outstanding during the periods[76](index=76&type=chunk) [12 Property, Plant and Equipment](index=23&type=section&id=12%20Property%2C%20Plant%20and%20Equipment) As of June 30, 2025, the net book value of property, plant and equipment was HK$757 thousand, a decrease from the beginning of the period, primarily due to depreciation Changes in Net Book Value of Property, Plant and Equipment (HK$'000) | Item | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | | :--- | :--- | :--- | | Net book value at beginning of period | 927 | 626 | | Additions | – | 644 | | Depreciation | (182) | (163) | | Exchange differences | 12 | (4) | | **Net book value at end of period** | **757** | **1,103** | - There were no new additions in the first half of 2025, and depreciation expense amounted to **HK$182 thousand**[78](index=78&type=chunk) [13 Investment Properties](index=24&type=section&id=13%20Investment%20Properties) As of June 30, 2025, the fair value of investment properties was HK$92,501 thousand, a decrease from the beginning of the period, primarily due to negative fair value changes recognized in profit or loss Changes in Fair Value of Investment Properties (HK$'000) | Item | June 30, 2025 (HK$'000) | June 30, 2024 (HK$'000) | | :--- | :--- | :--- | | Fair value at beginning of period | 99,758 | 116,096 | | Fair value changes recognized in profit or loss | (8,452) | (2,341) | | Exchange differences | 1,195 | (679) | | **Fair value at end of period** | **92,501** | **113,076** | - Fair value changes of investment properties recognized in profit or loss amounted to a negative **HK$8,452 thousand**, which is the primary reason for the decrease in fair value[81](index=81&type=chunk) - Investment properties include residential property units in Hong Kong (**HK$16,400 thousand**) and commercial property units in Mainland China (**HK$76,101 thousand**)[83](index=83&type=chunk) - Valuations were performed by independent qualified professional valuer Hannah Surveyors Limited, referencing market transaction prices and capitalization of rental income[85](index=85&type=chunk)[87](index=87&type=chunk) [14 Intangible Assets](index=26&type=section&id=14%20Intangible%20Assets) As of June 30, 2025, the net book value of intangible assets was HK$75,010 thousand, a slight increase from the beginning of the period, primarily comprising goodwill and a supply chain finance platform Changes in Net Book Value of Intangible Assets (HK$'000) | Item | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | | :--- | :--- | :--- | | Net book value at beginning of period | 74,769 | 71,806 | | Additions | 572 | 1,868 | | Amortisation expense | (1,472) | (1,126) | | Exchange differences | 1,141 | (495) | | **Net book value at end of period** | **75,010** | **72,053** | - Intangible assets primarily include goodwill (**HK$54,407 thousand**) and a supply chain finance platform (**HK$20,603 thousand**)[92](index=92&type=chunk) - As of June 30, 2025, the directors of the company believe there was no impairment of cash-generating units[93](index=93&type=chunk)[95](index=95&type=chunk) [15 Receivables Under Sale and Leaseback Arrangements](index=27&type=section&id=15%20Receivables%20Under%20Sale%20and%20Leaseback%20Arrangements) As of June 30, 2025, total receivables under sale and leaseback arrangements decreased to HK$761,361 thousand, with a significant shift from current to non-current portions, all non-overdue and bearing fixed interest rates Receivables Under Sale and Leaseback Arrangements (HK$'000) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Current assets | 112,860 | 566,938 | -80.1% | | Non-current assets | 648,501 | 358,308 | 81.0% | | **Total** | **761,361** | **925,246** | **-17.7%** | - The repayment term structure of receivables changed, with a significant decrease in amounts due within one year and a notable increase in amounts due within one to four years[102](index=102&type=chunk) - All receivables under sale and leaseback arrangements are not overdue, and bear fixed annual interest rates ranging from **5.0%** to **5.5%**[103](index=103&type=chunk)[106](index=106&type=chunk) [16 Trade Receivables](index=30&type=section&id=16%20Trade%20Receivables) As of June 30, 2025, trade receivables amounted to HK$2,194 thousand, a decrease from December 31, 2024, with a typical credit period of 30 days and all receivables due within three months Trade Receivables (HK$'000) | Indicator | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Receivables | 2,194 | 2,752 | -20.3% | - The credit period for trade receivables is typically **30 days**, with all amounts due within three months[108](index=108&type=chunk) [17 Interest in an Associate](index=31&type=section&id=17%20Interest%20in%20an%20Associate) As of June 30, 2025, the group's interest in associate Jingxi Commercial Factoring Co., Ltd. increased to HK$89,707 thousand, with the associate primarily providing factoring services in China Changes in Interest in an Associate (HK$'000) | Item | Six Months Ended June 30, 2025 (HK$'000) | Year Ended December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Beginning of period/year | 86,337 | 84,851 | | Share of operating profit | 1,354 | 4,712 | | Share of other comprehensive income/(loss) | 2,016 | (3,226) | | **Interest in an associate** | **89,707** | **86,337** | - The associate is Jingxi Commercial Factoring Co., Ltd., primarily providing factoring services in China, with the group holding a **41.41%** effective ownership interest[110](index=110&type=chunk)[111](index=111&type=chunk) - The cost of investment in the associate includes goodwill of approximately **HK$23,716 thousand**, which management believes is not impaired[113](index=113&type=chunk)[114](index=114&type=chunk) [18 Share Capital](index=32&type=section&id=18%20Share%20Capital) As of June 30, 2025, the company's issued and fully paid share capital was HK$39,539 thousand, comprising approximately 3,953,938,703 ordinary shares of HK$0.01 each, with 903,000 shares repurchased and cancelled during the period Changes in Share Capital (HK$'000) | Item | Number of Shares | Amount (HK$'000) | | :--- | :--- | :--- | | As at January 1, 2025 | 3,957,702,703 | 39,577 | | Shares cancelled | (3,764,000) | (38) | | **As at June 30, 2025** | **3,953,938,703** | **39,539** | - The company repurchased **903,000 shares** during the period for a total consideration of approximately **HK$99 thousand**, and all repurchased shares were cancelled[116](index=116&type=chunk)[117](index=117&type=chunk) [19 Trade Payables, Other Payables and Accruals](index=33&type=section&id=19%20Trade%20Payables%2C%20Other%20Payables%20and%20Accruals) As of June 30, 2025, total trade payables, other payables, and accruals significantly decreased to HK$77,345 thousand from HK$102,143 thousand, mainly due to reductions in guarantee deposits received, other taxes payable, and accrued salaries and bonuses Trade Payables, Other Payables and Accruals (HK$'000) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Trade payables | 4 | 1,783 | -99.8% | | Accrued salaries and bonuses | 11,915 | 13,788 | -13.7% | | Guarantee deposits received | 7,444 | 32,085 | -76.8% | | Other taxes payable | 34,745 | 39,399 | -11.8% | | Dividends payable | 11,862 | – | N/A | | **Total** | **77,345** | **102,143** | **-24.3%** | - Trade payables significantly decreased to **HK$4 thousand**, all due within **30 days**[119](index=119&type=chunk) - Guarantee deposits received significantly decreased from **HK$32,085 thousand** to **HK$7,444 thousand**[119](index=119&type=chunk) [20 Related Party Disclosures](index=34&type=section&id=20%20Related%20Party%20Disclosures) This chapter discloses the group's various related party transactions and outstanding balances with its controlling shareholder Shougang Group Co., Ltd. and its subsidiaries, as well as other China government-related financial institutions - The company is ultimately controlled by Shougang Group Co., Ltd., a state-owned enterprise directly supervised by the State Council of the PRC[120](index=120&type=chunk) Transactions with Related Parties (HK$'000) | Transaction Category | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue from sale and leaseback arrangements (Shougang Group subsidiaries) | 12,451 | 7,726 | 61.1% | | Revenue from supply chain management and financial technology services (Shougang Group subsidiaries) | 5,586 | 5,530 | 1.0% | | Interest income from credit financing arrangements (Shougang Group subsidiaries) | 9,970 | 3,936 | 153.3% | | Management fee expenses (Shougang Group subsidiaries) | 236 | 187 | 26.2% | | IT service expenses (Shougang Group subsidiaries) | 1,298 | – | N/A | | Lease payments (Shougang Group subsidiaries) | 704 | 850 | -17.2% | - As of June 30, 2025, total receivables under sale and leaseback arrangements from Shougang Group subsidiaries amounted to **HK$410,219 thousand**[128](index=128&type=chunk) - As of June 30, 2025, receivables under credit financing arrangements amounted to **HK$492,955 thousand**, bearing interest at an annual rate of **5%**[136](index=136&type=chunk) - As of June 30, 2025, current deposits placed with financial institutions of Shougang Group subsidiaries amounted to **HK$208,731 thousand**, bearing an annual interest rate of **1.35%**[140](index=140&type=chunk) Report on Review of Interim Financial Information This section contains the auditor's review report on the condensed consolidated interim financial information, including their conclusion and other relevant matters [Conclusion](index=40&type=section&id=Conclusion) The auditor, Shinewing (HK) CPA Limited, found no matters suggesting that the group's condensed consolidated interim financial information was not prepared in all material respects in accordance with HKAS 34 - The auditor issued an unmodified conclusion on the group's condensed consolidated interim financial information[148](index=148&type=chunk)[151](index=151&type=chunk) - A review is substantially less in scope than an audit, and therefore no audit opinion is expressed[145](index=145&type=chunk)[147](index=147&type=chunk) [Other Matter](index=40&type=section&id=Other%20Matter) Comparative financial data in this interim report for the six months ended June 30, 2024, and the financial position as of December 31, 2024, were reviewed or audited by another auditor, both with unmodified conclusions or opinions - The comparative interim financial information for the six months ended June 30, 2024, was reviewed by another auditor who expressed an unmodified conclusion[149](index=149&type=chunk)[152](index=152&type=chunk) - The comparative consolidated statement of financial position as of December 31, 2024, was audited by another auditor who expressed an unmodified opinion[150](index=150&type=chunk)[152](index=152&type=chunk) Management Discussion and Analysis This section provides management's perspective on the group's financial performance, business operations, liquidity, capital structure, and future outlook [Key Financial Performance Indicators](index=41&type=section&id=Key%20Financial%20Performance%20Indicators) For the six months ended June 30, 2025, the group's revenue significantly decreased by 56% to HK$47,822 thousand, but gross profit margin improved to 85%, with profit for the period and basic earnings per share increasing Key Financial Performance Indicators (HK$'000) | Indicator | Six Months Ended June 30, 2025 (HK$'000) | Six Months Ended June 30, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 47,822 | 109,452 | -56% | | Gross Profit Margin (%) | 85% | 53% | 32% | | Profit for the Period | 27,493 | 26,261 | 5% | | Profit Attributable to Owners of the Company | 19,838 | 17,981 | 10% | | Basic Earnings Per Share (HK cents) | 0.50 | 0.45 | 11% | Key Financial Indicators (HK$'000) | Indicator | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Cash | 330,152 | 282,810 | 17% | | Total Assets | 1,863,590 | 1,868,022 | 1% | | Total Liabilities | 104,830 | 136,978 | -23% | | Current Ratio | 1,133% | 1,079% | 54% | - Gross profit margin significantly improved from **53%** to **85%**, indicating enhanced profitability[157](index=157&type=chunk) [Financial Overview](index=42&type=section&id=Financial%20Overview) For the six months ended June 30, 2025, profit attributable to owners of the company increased by 10% to HK$19,838 thousand, despite a 56% decline in total revenue, driven by improved risk management and a higher gross profit margin - Profit attributable to owners of the company increased by **10%**, primarily due to significant efforts in risk management and control for sale and leaseback customers, resulting in reduced impairment losses on financial assets[160](index=160&type=chunk)[161](index=161&type=chunk) - Total revenue decreased by **56%**, mainly due to a shift in business direction within the sale and leaseback arrangements segment, reallocating resources from individual customers to corporate clients[160](index=160&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) - Gross profit margin increased from **53%** to **85%**, primarily due to the change in business direction[160](index=160&type=chunk)[161](index=161&type=chunk)[163](index=163&type=chunk) - Other income significantly increased by **111%** to **HK$11,094 thousand**, mainly due to increased income from credit financing arrangements from related parties[164](index=164&type=chunk)[166](index=166&type=chunk) [Business Review and Outlook](index=44&type=section&id=Business%20Review%20and%20Outlook) The group aims to be a supply chain financial technology platform service provider, focusing on supply chain management, financial leasing, and commercial factoring, while exploring new energy management opportunities and enhancing risk control - The group's core businesses are supply chain management and financial technology, financial leasing, and commercial factoring, aiming to become an industry-finance integrated supply chain financial technology platform service provider[168](index=168&type=chunk)[173](index=173&type=chunk) - The group will explore business opportunities related to energy management and energy-saving renovation (EMC) to maximize shareholder returns[169](index=169&type=chunk)[174](index=174&type=chunk) - The group will strengthen its risk control system, introduce information technology platforms, and promote the construction of online risk control platforms based on asset securitization and industry supply chain businesses[196](index=196&type=chunk)[197](index=197&type=chunk) [Sale and Lease Back Arrangements Business Segment](index=44&type=section&id=Sale%20and%20Lease%20Back%20Arrangements%20Business%20Segment) Revenue from sale and leaseback arrangements decreased by 68% to HK$29,650 thousand due to a strategic shift from individual to corporate clients, with future focus on energy management and energy-saving renovation projects - Revenue from sale and leaseback arrangements business decreased by **68%** to **HK$29,650 thousand**, but segment results remained stable[184](index=184&type=chunk) - The business direction shifted, reallocating more resources from individual customers to corporate clients, particularly steel enterprises and large domestic enterprise groups and their upstream and downstream customers[176](index=176&type=chunk)[179](index=179&type=chunk)[184](index=184&type=chunk) - As of June 30, 2025, approximately **95%** of the total receivables under sale and leaseback arrangements were from three major customers, two of whom are related parties[177](index=177&type=chunk)[179](index=179&type=chunk) - More resources will be invested in providing financial leasing services for energy management and energy-saving renovation (EMC) projects and engineering companies in the future[185](index=185&type=chunk)[186](index=186&type=chunk) [Supply Chain Management and Financial Technology Business Segment](index=47&type=section&id=Supply%20Chain%20Management%20and%20Financial%20Technology%20Business%20Segment) Revenue from supply chain management and financial technology business grew by 19.5% to HK$16,149 thousand, focusing on multi-level electronic debt certificates for the steel industry supply chain, with plans to enhance platform intelligence and diversify products - Revenue from supply chain management and financial technology business increased by **19.5%** to **HK$16,149 thousand**, but segment results decreased due to increased staff costs[188](index=188&type=chunk)[191](index=191&type=chunk) - This business focuses on multi-level electronic debt certificates ("Shougang Jingpiao") for the steel industry supply chain, utilizing blockchain technology to provide suppliers with immutable and traceable digital credentials[188](index=188&type=chunk)[191](index=191&type=chunk) - In the future, diversified Shougang Jingpiao products and pricing strategies will be developed, and various products will continue to be developed to address financing difficulties and high costs for small and medium-sized suppliers[189](index=189&type=chunk)[192](index=192&type=chunk) - The group will continue to enhance the intelligence level of the Shougang Supply Chain Finance Platform (i.e., integration with DeepSeek) and explore other business opportunities within the supply chain[190](index=190&type=chunk)[192](index=192&type=chunk) [Property Leasing Business Segment](index=48&type=section&id=Property%20Leasing%20Business%20Segment) Property leasing business revenue remained stable at HK$2,023 thousand, but the segment recorded a loss of HK$6,494 thousand, primarily due to a decrease in the fair value of investment properties - Property leasing business revenue remained stable, but the segment recorded a loss of **HK$6,494 thousand**, primarily due to a **HK$8,452 thousand** decrease in the fair value of investment properties[193](index=193&type=chunk)[195](index=195&type=chunk) - The group will leverage its supply chain finance platform to provide financing convenience for small and medium-sized merchants, reduce financing costs, and enhance supply chain stability[194](index=194&type=chunk)[195](index=195&type=chunk) [Liquidity, Financial Resources and Financing Activities](index=49&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Financing%20Activities) As of June 30, 2025, total cash increased by 17% to HK$330,152 thousand, primarily from operating activities, with total borrowings of HK$16,525 thousand and a healthy current ratio of 1,133% Key Data on Liquidity and Financing Activities (HK$'000) | Indicator | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Borrowings | 16,525 | 16,274 | 1.5% | | Total Cash | 330,152 | 282,810 | 16.7% | | Total Equity | 1,758,760 | 1,731,044 | 1.6% | | Total Assets | 1,863,590 | 1,868,022 | -0.2% | | Current Ratio | 1,133% | 1,079% | 54% | | Net Cash from Operating Activities | 49,503 | 120,207 | -58.8% | - The increase in total cash is primarily attributable to net cash generated from operating activities of approximately **HK$49,503 thousand**[200](index=200&type=chunk)[205](index=205&type=chunk) - All group borrowings are non-current, bear fixed interest rates, and no new borrowings were obtained during the period[201](index=201&type=chunk)[205](index=205&type=chunk) [Capital Structure](index=50&type=section&id=Capital%20Structure) As of June 30, 2025, equity and reserves attributable to owners of the company increased by 2% to approximately HK$1,423,097 thousand, mainly due to exchange differences from translation during the period, with no new shares issued - Equity and reserves attributable to owners of the company increased by **2%**, primarily due to exchange differences arising from translation during the period of approximately **HK$18,796 thousand**[202](index=202&type=chunk)[206](index=206&type=chunk) - The company did not issue any new shares during the period, and its issued share capital was approximately **HK$39,539 thousand**[202](index=202&type=chunk)[206](index=206&type=chunk) [Material Acquisitions, Disposals and Significant Investment](index=50&type=section&id=Material%20Acquisitions%2C%20Disposals%20and%20Significant%20Investment) On January 9, 2025, Southern International Leasing Co., Ltd. entered into a disposal agreement to sell receivables for a consideration not exceeding RMB300 million, with no other material acquisitions, disposals, or significant investments during the period - Southern Leasing disposed of receivables on January 9, 2025, for a consideration not exceeding **RMB300 million** (approximately **HK$318.03 million**)[203](index=203&type=chunk)[207](index=207&type=chunk) - Save as disclosed above, there were no other material acquisitions, disposals, or significant investment matters by the group for the six months ended June 30, 2025[204](index=204&type=chunk)[207](index=207&type=chunk) [Charge on Assets](index=51&type=section&id=Charge%20on%20Assets) As of June 30, 2025, the group had no assets pledged - As of June 30, 2025, the group had no assets pledged[208](index=208&type=chunk)[213](index=213&type=chunk) [Foreign Exchange Exposure](index=51&type=section&id=Foreign%20Exchange%20Exposure) The group primarily operates in Hong Kong and China, with transactions denominated in HKD and RMB, and the Board believes there is no significant foreign exchange risk, considering hedging with forward foreign exchange contracts if necessary - The group's principal businesses and investments are in Hong Kong and China, with income and expenses denominated in Hong Kong dollars and Renminbi[209](index=209&type=chunk)[214](index=214&type=chunk) - The Board believes the group has no significant foreign exchange exposure and will consider using forward foreign exchange contracts for hedging if necessary[209](index=209&type=chunk)[214](index=214&type=chunk) [Contingent Liabilities](index=51&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the group had no significant contingent liabilities - As of June 30, 2025, the group had no significant contingent liabilities[210](index=210&type=chunk)[215](index=215&type=chunk) [Employees](index=51&type=section&id=Employees) As of June 30, 2025, the group employed 61 full-time employees, a decrease from December 31, 2024, with remuneration based on market practice, performance, and experience, including various benefits - As of June 30, 2025, the group employed **61** full-time employees, a decrease from **63** as of December 31, 2024[211](index=211&type=chunk)[216](index=216&type=chunk) - Remuneration is determined by market practice, individual performance, and work experience, with benefits including medical insurance, provident fund schemes, and discretionary bonuses[211](index=211&type=chunk)[216](index=216&type=chunk) - No amounts were paid or committed by the company or its subsidiaries as joining bonuses during the period[212](index=212&type=chunk)[216](index=216&type=chunk) Other Information This section includes disclosures on interim dividends, share repurchases, directors' and shareholders' interests, share option schemes, audit committee review, connected transactions, and corporate governance compliance [Interim Dividend](index=52&type=section&id=Interim%20Dividend) The Board did not declare an interim dividend for the six months ended June 30, 2025, consistent with the corresponding period in 2024 - The Board did not declare an interim dividend for the six months ended June 30, 2025 (2024: nil)[218](index=218&type=chunk)[219](index=219&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=52&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) For the six months ended June 30, 2025, the company repurchased 903,000 shares on the Stock Exchange for approximately HK$98,595, all of which were cancelled, with no other listed securities purchased, sold, or redeemed Share Repurchase Details | Month | Number of Shares Repurchased | Price Per Share (Highest) (HK$) | Price Per Share (Lowest) (HK$) | Total Consideration Paid (HK$) | | :--- | :--- | :--- | :--- | :--- | | January | 903,000 | 0.114 | 0.108 | 98,595 | | **Total** | **903,000** | **-** | **-** | **98,595** | - All repurchased shares were cancelled[219](index=219&type=chunk) - Save as disclosed above, neither the company nor any of its subsidiaries purchased, sold, or redeemed any listed securities during the period[222](index=222&type=chunk) [Directors' and Chief Executives' Interests and Short Positions in Shares, Underlying Shares and Debentures](index=53&type=section&id=Directors%27%20and%20Chief%20Executives%27%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) As of June 30, 2025, Executive Director Tian Gang held a long position of 1,685,000 shares, representing 0.04% of the total issued shares, with no other directors or chief executives holding disclosable interests or short positions Directors' Long Positions in Shares | Name of Director | Nature of Interest | Number of Shares/Underlying Shares Held | Approximate Percentage of Total Issued Shares (%) | | :--- | :--- | :--- | :--- | | Tian Gang | Personal | 1,685,000 | 0.04% | - Save for Tian Gang, no other directors or chief executives or their associates held any interests or short positions required to be disclosed under the SFO or the Model Code[226](index=226&type=chunk)[229](index=229&type=chunk) [Interests and Short Positions of Shareholders Discloseable Under the SFO](index=54&type=section&id=Interests%20and%20Short%20Positions%20of%20Shareholders%20Discloseable%20Under%20the%20SFO) As of June 30, 2025, Shougang Group and its subsidiaries collectively held a 61.35% long position in the company's shares, with Mr. Ye Hongyi and Mr. Zhuang Tianlong also holding significant long positions Major Shareholders' Long Positions in Shares | Name of Shareholder | Capacity | Number of Shares/Underlying Shares Held | Approximate Percentage of Total Issued Shares (%) | | :--- | :--- | :--- | :--- | | Shougang Group | Interest of controlled corporation | 2,425,736,972 | 61.35% | | Wheeling Holdings Limited | Beneficial owner | 2,025,736,972 | 51.23% | | Beijing Shougang Fund Co., Ltd. | Interest of controlled corporation | 400,000,000 | 10.12% | | Jingxi Holdings Limited | Beneficial owner | 400,000,000 | 10.12% | | Mr. Ye Hongyi | Interest of controlled corporation | 213,600,000 | 5.40% | | HY Holding Limited | Beneficial owner | 213,600,000 | 5.40% | | Mr. Zhuang Tianlong | Interest of controlled corporation | 254,413,000 | 6.43% | | VMS Investment Group Limited | Beneficial owner | 254,413,000 | 6.43% | - Shougang Group holds shares in the company through its wholly-owned subsidiaries, Wheeling Holdings Limited and Beijing Shougang Fund Co., Ltd[233](index=233&type=chunk)[234](index=234&type=chunk) [Share Option Schemes](index=56&type=section&id=Share%20Option%20Schemes) As of June 30, 2025, the company had no share option schemes - As of June 30, 2025, the company had no share option schemes[236](index=236&type=chunk)[240](index=240&type=chunk) [Audit Committee](index=56&type=section&id=Audit%20Committee) The Audit Committee met on August 19, 2025, with the auditor and management to review the group's interim results for the six months ended June 30, 2025 - The Audit Committee reviewed the group's interim results for the six months ended June 30, 2025, on **August 19, 2025**[237](index=237&type=chunk)[241](index=241&type=chunk) [Connected Transactions](index=56&type=section&id=Connected%20Transactions) Independent non-executive directors reviewed the continuing connected transactions for the year ended December 31, 2024, confirming they were conducted in the ordinary course of business, on normal commercial terms or better, and in the overall interest of shareholders - The independent non-executive directors confirmed that the continuing connected transactions were entered into in the ordinary course of the group's business[238](index=238&type=chunk)[242](index=242&type=chunk) - The transactions were conducted on normal commercial terms or better, and their terms were fair and reasonable and in the overall interest of the company's shareholders[242](index=242&type=chunk) [Compliance with Corporate Governance Code](index=57&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) For the six months ended June 30, 2025, the company complied with the code provisions of the Corporate Governance Code as set out in Appendix 14 to the Listing Rules - The company complied with the code provisions of the Corporate Governance Code as set out in Appendix 14 to the Listing Rules[243](index=243&type=chunk)[246](index=246&type=chunk) [Compliance with Model Code for Securities Transactions by Directors](index=57&type=section&id=Compliance%20with%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors) Following inquiries with all directors, it was confirmed that they complied with the standards set out in the Model Code and the company's code of conduct for securities transactions by directors for the six months ended June 30, 2025 - All directors complied with the standards set out in the Model Code and the company's code of conduct for securities transactions by directors[244](index=244&type=chunk)[247](index=247&type=chunk) [Appreciation](index=57&type=section&id=Appreciation) The Chairman of the Board, Sun Yajie, on behalf of the Board, extended sincere gratitude to clients, suppliers, shareholders, and the group's management and staff - The Chairman of the Board, Sun Yajie, expressed gratitude to clients, suppliers, shareholders, and the group's management and staff[245](index=245&type=chunk)[248](index=248&type=chunk)[249](index=249&type=chunk)

2025 中期報告 中國民航信息網絡股份有限公司 中期報告 2025 電話： (8610) 5765 0696 傳真： (8610) 5765 0695 電郵： ir@travelsky.com.cn (投資者聯繫方式) 地址： 中國北京順義區後沙峪鎮中國航信高科技產業園區 郵編： 101318 網址： www.travelskyir.com C147690 目錄 | 二零二五年上半年業務回顧 | 2 | | --- | --- | | 管理層對財務狀況和經營業績的討論及分析 | 6 | | 二零二五年下半年展望 | 16 | | 其他資料 | 17 | | 合併資產負債表 | 25 | | 母公司資產負債表 | 29 | | 合併利潤表 | 33 | | 母公司利潤表 | 36 | | 合併現金流量表 | 38 | | 母公司現金流量表 | 41 | | 合併所有者權益變動表 | 43 | | 母公司所有者權益變動表 | 45 | | 二零二五年半年度財務報表附註 | 47 | | 公司資料 | 209 | 中國民航信息網絡股份有限公司 二零二五年上半年業務回顧 中國民航信息網絡股份有限公司（「本公司」）之 ...

Financial Performance - Revenue for the six months ended June 30, 2025, was approximately HKD 134.5 million, a decrease of 1.1% compared to HKD 136.1 million in the same period of 2024[7]. - The cost of sales increased by 10.6% to HKD 119.9 million, resulting in a gross profit of HKD 14.6 million, down 47.3% from HKD 27.6 million in 2024, with a gross margin of 10.8%[7]. - The loss from continuing operations for the period was HKD 29.9 million, an increase of 38.7% from HKD 21.6 million in 2024[7]. - For the six months ended June 30, 2025, the group recorded revenue of approximately HKD 134.5 million, a slight decrease of 1.1% compared to HKD 136.1 million for the same period in 2024[21]. - The sales of digital imaging products significantly decreased by 59.7%, contributing only HKD 19.4 million, down from HKD 48.1 million in 2024[21]. - The group’s gross profit for the six months ended June 30, 2025, was approximately HKD 14.6 million, a decrease of 47.3% from HKD 27.6 million in 2024, with a gross margin dropping from 20.3% to 10.8%[27]. - The group reported a net loss of approximately HKD 29.9 million for the six months ended June 30, 2025[35]. - The company reported a total loss of HKD 29,889,000 for the period, compared to a loss of HKD 39,602,000 in the same period of 2024[109]. - Basic loss per share from continuing operations was HKD 0.020, compared to HKD 0.015 in the previous year, indicating a decline in profitability[111]. - The company reported a loss of HKD (29,889,000) for the six months ended June 30, 2025, compared to a loss of HKD (39,602,000) in 2024, indicating an improvement in performance[140]. Strategic Initiatives - The company has initiated a strategic shift from Joint Design Manufacturing (JDM) to Original Design Manufacturing (ODM) to improve financial performance, with positive results observed in the first half of 2025[13]. - The company plans to expand its instant delivery system services for supermarkets in China, capitalizing on the rapid growth of the instant retail delivery market since 2020[14]. - Approximately 3,200 electric delivery vehicles and related equipment have been procured to support the new instant delivery service division[15]. - The company aims to enhance operational efficiency and reduce costs in the second half of 2025 while focusing on developing innovative products[18]. - The new ODM products developed in the first half of 2025 are expected to significantly contribute to revenue in the second half of 2025[17]. - The company believes that the instant delivery system service for supermarkets represents a blue ocean market with substantial commercial potential[19]. - The sales team will be strengthened, particularly in the Japanese and European markets, to enhance operational capabilities and provide more efficient services[20]. Financial Position - Cash and cash equivalents increased to approximately HKD 59.4 million as of June 30, 2025, compared to HKD 27.8 million in 2024[36]. - As of June 30, 2025, the group's total equity was approximately HKD 30.2 million, down from HKD 57.5 million as of December 31, 2024[52]. - The group's total assets amounted to approximately HKD 256.3 million, slightly up from HKD 255.9 million as of December 31, 2024[52]. - The total liabilities increased to approximately HKD 226.1 million from HKD 198.4 million as of December 31, 2024[52]. - The debt-to-equity ratio rose significantly to approximately 151.6% as of June 30, 2025, compared to 75.1% as of December 31, 2024[40]. - The group secured bank financing of approximately HKD 110.1 million as of June 30, 2025, up from HKD 54.9 million as of December 31, 2024[39]. - The group utilized approximately HKD 32.9 million of the bank financing during the first half of 2025, compared to HKD 25.8 million as of December 31, 2024[39]. - The group incurred capital expenditures of approximately HKD 2.0 million during the first half of 2025, down from HKD 3.5 million in the same period of 2024[41]. - The company’s total liabilities increased to HKD 226,090,000 from HKD 198,430,000, marking a rise of 13.9%[115]. - The net asset value decreased to HKD 30,178,000 from HKD 57,488,000, a decline of 47.5%[117]. Operational Efficiency - Selling and distribution expenses decreased by 29.8% to approximately HKD 8.4 million, down from HKD 12.0 million in 2024[29]. - Administrative expenses were reduced by 18.5% to approximately HKD 18.4 million, compared to HKD 22.6 million in 2024[30]. - Research and development costs decreased by 30.6% to approximately HKD 11.4 million, down from HKD 16.4 million in 2024[31]. - Employee costs for the group were approximately HKD 32.3 million for the first half of 2025, compared to HKD 35.3 million in the same period of 2024[46]. - The group recognized an inventory provision of HKD 10,641,000 for the six months ended June 30, 2025, compared to a reversal of HKD 2,991,000 in 2024[156]. Shareholder Information - The total number of shares that can be issued under the stock option plan is capped at 80,000,000 shares, which represents approximately 10% of the total shares issued as of the listing date[88]. - As of the report date, the total number of shares available for issuance under the stock option plan is 79,058,000 shares, accounting for about 7.84% of the total issued shares[91]. - The maximum allocation for any eligible participant within any 12-month period cannot exceed 1% of the issued shares as of the grant date[90]. - The stock option plan is effective until July 2, 2025, unless terminated earlier by the company at a shareholders' meeting or board meeting[92]. - The exercise price of the options is determined by the board and cannot be lower than the highest of the closing price on the grant date or the average closing price over the five trading days preceding the grant date[92]. - As of January 1, 2025, the total number of options available for grant is 77,328,000 shares, representing approximately 7.67% of the issued share capital[94]. - No stock options were granted under the plan during the first half of 2025[98]. Corporate Governance - The company continues to adhere to the corporate governance code, with the exception of the separation of roles between the Chairman and CEO, which is justified by the board for effective leadership[102]. - The audit committee, consisting of three independent non-executive directors, reviewed the interim report and found no objections to the accounting treatment adopted by the company[106]. - The company has not identified any non-compliance with the written guidelines for securities trading by employees as of mid-2025[103].

[Company Overview](index=3&type=section&id=Company%20Overview) Yida China Holdings Limited, established in 1988, is a leading business park developer and operator in China, offering services including park development, property sales, entrusted operation management, and construction. - Yida China, established in 1988, is China's largest business park developer and a leading operator[7](index=7&type=chunk) - Core businesses include business park development and operation, sales of supporting residential and office properties, entrusted operation management, and construction, decoration, and landscaping services[7](index=7&type=chunk) - The company successfully developed and operates Dalian Software Park and other parks using an "industry-city integration" model, serving nearly **80 Fortune Global 500 companies**[7](index=7&type=chunk)[8](index=8&type=chunk) - The company's vision is to become "China's leading business park operator" and implement a nationwide development strategy of "light asset-driven, heavy and light asset combined"[8](index=8&type=chunk) [Company Information](index=4&type=section&id=Company%20Information) This section provides essential information about Yida China Holdings Limited, including its board members, joint company secretaries, authorized representatives, board committee compositions, registered office, headquarters, and stock code. - The Board of Directors includes Mr. Jiang Xiuwen (Chairman and CEO), Mr. Lu Jianhua (Vice Chairman), and several executive, non-executive, and independent non-executive directors[10](index=10&type=chunk) - Mr. Chen Yichuan chairs the Audit Committee, Mr. Guo Shaomu chairs the Remuneration Committee, and Mr. Jiang Xiuwen chairs the Nomination Committee[10](index=10&type=chunk) - The company is registered in the Cayman Islands, with its China headquarters in Dalian and principal place of business in Hong Kong located in Wan Chai[10](index=10&type=chunk)[11](index=11&type=chunk) - The company's stock code is **3639**, and its official website is www.yidachina.com[12](index=12&type=chunk) [Chairman's Report](index=6&type=section&id=Chairman%27s%20Report) The Chairman's Report reviews Yida China's operating performance and market environment for the first half of 2025, outlining strategies for the second half. 2025 First Half Key Financial Data | Indicator | Amount (RMB million) | | :--- | :--- | | Revenue | 700 | | Gross Profit | 100 | | Gross Profit Margin | 14.2% | | Net Loss Attributable to Owners of the Company | 776 | - The real estate market continued its deep adjustment in the first half of 2025, with declining land auction transaction volumes and contracted GFA[19](index=19&type=chunk) - The company faced prominent debt risks during the period, with management focusing on improving operations and resolving debt risks to implement key initiatives[19](index=19&type=chunk) - Second-half outlook: Macro policies are expected to strengthen, but market demand, housing price expectations, and supply of quality real estate projects remain weak; the company will focus on core business drivers, accelerate destocking of existing projects, and revitalize assets to improve its debt-to-asset ratio[20](index=20&type=chunk) [Management Discussion and Analysis](index=8&type=section&id=Management%20Discussion%20and%20Analysis) This section details Yida China's business operations and financial performance for the first half of 2025, highlighting revenue changes across segments, expanded net loss, and increased liquidity pressure. [Business Review](index=8&type=section&id=Business%20Review) This section reviews Yida China's performance across its five core business segments: business park held property operations, property sales, business park operations management, construction, decoration and landscaping, and land reserve. [Business Park Held Property Operations](index=8&type=section&id=Business%20Park%20Held%20Property%20Operations) In the first half of 2025, Yida China held four wholly-owned business parks and a 50% interest in Wuhan Software New City, with total GFA of approximately 1.929 million sq.m., experiencing an 11.2% decrease in rental income due to lower occupancy. - The Group wholly owns four business parks: Dalian Software Park, Dalian Science and Technology City, Yida Information Software Park, and Dalian Tiandi, and holds a **50% interest in Wuhan Software New City**[22](index=22&type=chunk) - Total GFA of completed held properties is approximately **1.929 million sq.m.**, with leasable area of approximately **1.373 million sq.m.**[22](index=22&type=chunk) Business Park Rental Income | Indicator | 2025 First Half (RMB million) | 2024 First Half (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Rental Income | 216 | 243 | -11.2% | - The decrease in rental income is primarily due to a decline in occupancy rates, with approximately **28,000 sq.m.** of leased area returned by park clients due to international relations and geopolitical impacts[22](index=22&type=chunk)[24](index=24&type=chunk) - During the period, **11 new client enterprises** were added, with new contracted area of approximately **7,000 sq.m.**, and client stickiness was enhanced through industrial resource introduction and diversified value-added services[24](index=24&type=chunk)[25](index=25&type=chunk) [Property Sales](index=9&type=section&id=Property%20Sales) In the first half of 2025, Yida China focused on asset revitalization, debt risk control, and sales collection amidst a deeply adjusting real estate market, achieving contracted sales of RMB 415 million. - The real estate market continued its deep adjustment and transformation, with the company focusing on "asset revitalization, debt risk control, sales collection, and project construction"[26](index=26&type=chunk) 2025 First Half Property Sales Data | Indicator | Amount/Value | | :--- | :--- | | Contracted Sales Amount | RMB 415 million | | Contracted Sales Area | 34,100 sq.m. | | Contracted Sales Average Price | RMB 12,148/sq.m. | | Sales Revenue | RMB 212 million | | Sales Revenue YoY Change | +20.8% | | Sales Revenue Average Price | RMB 11,077/sq.m. | | Sales Revenue Average Price YoY Change | -39.7% | - The increase in sales revenue was mainly due to an increase in delivered projects during the period, while the decrease in average sales price was due to a different product mix compared to the same period in 2024, primarily lower-priced ordinary residential products and apartments[27](index=27&type=chunk) - Major sales projects are primarily located in Dalian, accounting for **82.2% of contracted sales amount**[26](index=26&type=chunk) [Business Park Operations Management](index=11&type=section&id=Business%20Park%20Operations%20Management) The Group is committed to developing smart park investment promotion and operations, with entrusted management area of approximately 219,000 sq.m. in the first half of 2025, generating RMB 87 million in revenue. - The Group is committed to developing smart park investment promotion and smart park operations, building a national industrial investment network matrix[30](index=30&type=chunk) 2025 First Half Business Park Operations Management Revenue | Indicator | 2025 First Half (RMB million) | 2024 First Half (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 87 | 100 | -13.2% | - The decrease in revenue was mainly due to clients scaling down their business operations during the period[30](index=30&type=chunk)[45](index=45&type=chunk) [Construction, Decoration and Landscaping](index=11&type=section&id=Construction%2C%20Decoration%20and%20Landscaping) Facing a downturn in the real estate industry, this business segment continued to contract, but Yida China recorded RMB 185 million in revenue, a 25.3% increase, primarily due to increased output from external projects. - The real estate industry is generally declining, and the market for this business segment continues to contract[31](index=31&type=chunk) - The company employs multiple methods to strictly control costs, optimizing organizational structure through a digital management platform to enhance per capita efficiency[31](index=31&type=chunk) 2025 First Half Construction, Decoration and Landscaping Revenue | Indicator | 2025 First Half (RMB million) | 2024 First Half (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 185 | 148 | +25.3% | - The increase in revenue was mainly attributable to increased output from external projects completed during the period[31](index=31&type=chunk)[46](index=46&type=chunk) [Land Reserve](index=11&type=section&id=Land%20Reserve) As of June 30, 2025, Yida China's total land reserve GFA was approximately 6.47 million sq.m., with Dalian accounting for 77.1%, and business parks comprising 87.6% of the total. Land Reserve Overview as of June 30, 2025 | Indicator | Total GFA (sq.m.) | Attributable GFA (sq.m.) | | :--- | :--- | :--- | | Total | 6,474,612 | 5,958,111 | | Dalian Proportion | 77.1% | 83.8% | | Business Park Proportion | 87.6% | 86.6% | - Land reserve is primarily concentrated in Dalian, with business park projects accounting for the vast majority[32](index=32&type=chunk)[33](index=33&type=chunk) [Financial Review](index=16&type=section&id=Financial%20Review) This section provides a detailed review of Yida China's financial performance for the first half of 2025, noting a slight increase in total revenue but a significant decline in gross profit and an expanded net loss. 2025 First Half Revenue Breakdown | Revenue Source | 2025 First Half (RMB thousand) | % of Total | 2024 First Half (RMB thousand) | % of Total | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Property Sales Revenue | 212,200 | 30.3% | 175,623 | 26.3% | +20.8% | | Rental Income | 216,387 | 30.9% | 243,798 | 36.5% | -11.2% | | Business Park Operations Management Service Income | 86,889 | 12.4% | 100,080 | 15.0% | -13.2% | | Construction, Decoration and Landscaping Income | 184,932 | 26.4% | 147,564 | 22.2% | +25.3% | | **Total** | **700,408** | **100.0%** | **667,065** | **100.0%** | **+5.0%** | 2025 First Half Gross Profit and Gross Profit Margin | Indicator | 2025 First Half (RMB thousand) | 2024 First Half (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 99,701 | 189,347 | -47.3% | | Gross Profit Margin | 14.2% | 28.4% | -14.2 percentage points | - The decrease in gross profit and gross profit margin was mainly due to a different product mix recognized during the period, with corresponding gross profit lower than the same period in 2024[48](index=48&type=chunk) 2025 First Half Key Profit and Loss Item Changes | Indicator | 2025 First Half (RMB thousand) | 2024 First Half (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Cost of Sales | 600,707 | 477,718 | +25.7% | | Selling and Marketing Expenses | 27,920 | 23,363 | +19.5% | | Administrative Expenses | 50,752 | 58,255 | -12.9% | | Other Net Losses | (101,800) | (58,461) | +74.1% | | Fair Value (Loss)/Gain on Investment Properties | (123,899) | 233 | Turned from gain to loss | | Net Finance Costs | 505,433 | 399,786 | +26.4% | | Income Tax Expense | 70,010 | 16,191 | +332.4% | | Loss for the Period | (778,342) | (361,429) | Loss widened | | Net Loss Attributable to Owners of the Company | (775,538) | (360,118) | Loss widened | - Fair value of investment properties turned from gain to loss, mainly due to business relocation of certain international clients and cost-saving measures by some clients leading to multiple tenant departures from the parks[52](index=52&type=chunk) - Net finance costs increased primarily due to higher interest expenses and reduced capitalized interest during the period[53](index=53&type=chunk) - Income tax expense significantly increased, mainly due to higher land appreciation tax provision resulting from land appreciation tax settlement for properties sold during the period[56](index=56&type=chunk) [Liquidity, Financial and Capital Resources](index=18&type=section&id=Liquidity%2C%20Financial%20and%20Capital%20Resources) As of June 30, 2025, Yida China's cash and bank balances were approximately RMB 441 million, with restricted cash of RMB 255 million, and total bank and other borrowings of RMB 11.605 billion, indicating increased liquidity pressure. Cash Position as of June 30, 2025 | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Cash and Bank Balances | 440,872 | 373,802 | | Restricted Cash | 254,919 | 217,550 | Debt Overview as of June 30, 2025 | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Bank and Other Borrowings | 11,605,345 | 11,670,884 | | Repayable within one year or on demand | 11,551,811 | 11,618,346 | | Repayable in the second year | 53,534 | 52,538 | | Net Gearing Ratio | 168.6% | 152.6% | - The net gearing ratio increased by **16 percentage points** from the end of 2024, indicating rising debt pressure[63](index=63&type=chunk) - The company's functional currency is RMB, but it holds HKD and USD-denominated cash and bank balances, as well as USD and HKD-denominated borrowings, exposing it to foreign exchange risk[65](index=65&type=chunk) - Contingent liabilities include guarantees for customer mortgage financing of approximately **RMB 132 million** and guarantees for joint venture bank loans of approximately **RMB 48.78 million**[66](index=66&type=chunk) - As of June 30, 2025, the Group had **300 full-time employees**, a decrease from **348** at the end of 2024[67](index=67&type=chunk) - The Board resolved not to declare any interim dividend for the period[69](index=69&type=chunk) [Disclosure of Interests](index=21&type=section&id=Disclosure%20of%20Interests) This section discloses the interests and short positions of directors, chief executives, and substantial shareholders in the company's shares and related shares as of June 30, 2025. Interests of Directors and Chief Executives in the Company's Shares | Director Name | Capacity/Nature of Interest | Number of Shares Held (L) | Approximate % of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Jiang Xiuwen | Interest in controlled corporation | 68,600,000 | 2.65% | | Mr. Wang Gang | Interest in controlled corporation | 69,200,000 | 2.68% | Interests of Substantial Shareholders in the Company's Shares | Shareholder Name | Capacity/Nature of Interest | Number of Shares Held (L) | Approximate % of Issued Share Capital | | :--- | :--- | :--- | :--- | | Jiayou (International) Investment Co., Ltd. | Beneficial owner | 1,581,485,750 | 61.20% | | Jiahua (Holdings) Investment Co., Ltd. | Interest of a corporation controlled by a substantial shareholder | 1,581,485,750 | 61.20% | | Shanghai Pinzui Enterprise Management Co., Ltd. | Interest of a corporation controlled by a substantial shareholder | 1,581,485,750 | 61.20% | | CMIG Jiaye Investment Co., Ltd. | Interest of a corporation controlled by a substantial shareholder | 1,581,485,750 | 61.20% | | China Minsheng Investment Corp., Ltd. | Interest of a corporation controlled by a substantial shareholder | 1,581,485,750 | 61.20% | | Yang Meili | Joint and several receivers | 516,764,000 | 19.99% | | Chen Mingxiao | Joint and several receivers | 516,764,000 | 19.99% | | Sun Yin Huan | Founder of a discretionary trust | 241,400,000 | 9.34% | | TMF (Cayman) Ltd. | Trustee | 241,400,000 | 9.34% | | Right Ying Holdings Limited | Interest in controlled company | 241,400,000 | 9.34% | | Zhenghong Management Co., Ltd. | Beneficial owner | 241,400,000 | 9.34% | - **516,764,000 shares** held by Jiayou (International) Investment Co., Ltd. have been charged to Andu and joint and several receivers were appointed in May 2022[78](index=78&type=chunk)[97](index=97&type=chunk) [Corporate Governance and Other Information](index=24&type=section&id=Corporate%20Governance%20and%20Other%20Information) This section outlines Yida China's corporate governance practices, including compliance with the Corporate Governance Code, directors' securities transaction standards, and audit committee composition. - The company complies with the Corporate Governance Code, though the roles of Chairman and Chief Executive Officer are combined and held by Mr. Jiang Xiuwen, which the Board believes is in the company's best interest[80](index=80&type=chunk) - The Audit Committee comprises three independent non-executive directors, chaired by Mr. Chen Yichuan, and has reviewed and approved the interim results[83](index=83&type=chunk)[84](index=84&type=chunk) - The company faces Andu arbitration involving total payment obligations of approximately **US$209 million**, and despite a settlement agreement, the respondents have not fulfilled all payment obligations[85](index=85&type=chunk)[86](index=86&type=chunk) - Dalian Service Outsourcing Base Development Co., Ltd., a wholly-owned subsidiary, was convicted of bribery due to a former employee's actions[87](index=87&type=chunk) - The company's 2022 senior notes defaulted due to failure to pay consent fees and interest on time, leading to an acceleration notice and a winding-up petition that was subsequently withdrawn[90](index=90&type=chunk)[91](index=91&type=chunk) - The company has multiple material loan agreement defaults, including liquidity difficulties of the controlling shareholder, detention of a former executive director, delayed payment of senior notes, non-fulfillment of the Andu arbitration award, and overdue subsidiary loans, resulting in **RMB 6.445 billion** in outstanding borrowings and an additional **RMB 5.107 billion** potentially subject to immediate repayment[93](index=93&type=chunk)[95](index=95&type=chunk) - The controlling shareholder, China Minsheng Investment Corp., Ltd. or its subsidiaries, must beneficially own **35% or more** of the total outstanding shares of the company, otherwise the outstanding balance of total payment obligations will become due[96](index=96&type=chunk) [Condensed Consolidated Statement of Profit or Loss](index=29&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2025, Yida China recorded revenue of RMB 700 million, a 5.0% increase year-on-year, but a significant rise in cost of sales led to a 47.3% decrease in gross profit to RMB 99.7 million. Condensed Consolidated Statement of Profit or Loss Summary (For the six months ended June 30, 2025) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 700,408 | 667,065 | | Cost of Sales | (600,707) | (477,718) | | Gross Profit | 99,701 | 189,347 | | Fair Value (Loss)/Gain on Investment Properties | (123,899) | 233 | | Other Net Losses | (101,800) | (58,461) | | Finance Costs | (505,433) | (399,786) | | Loss Before Income Tax | (708,332) | (345,238) | | Income Tax Expense | (70,010) | (16,191) | | Loss for the Period | (778,342) | (361,429) | | Loss Attributable to Owners of the Company | (775,538) | (360,118) | | Basic and Diluted Loss Per Share (RMB cents) | (30.01) | (13.94) | [Condensed Consolidated Statement of Comprehensive Income](index=30&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, Yida China's total comprehensive loss for the period was RMB 778 million, consistent with the loss for the period, indicating no other comprehensive income or loss reclassifiable to profit or loss. Condensed Consolidated Statement of Comprehensive Income Summary (For the six months ended June 30, 2025) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the Period | (778,342) | (361,429) | | Other comprehensive loss that may be reclassified to profit or loss in subsequent periods | – | – | | Total Comprehensive Loss for the Period | (778,342) | (361,429) | | Attributable to Owners of the Company | (775,538) | (360,118) | | Attributable to Non-controlling Interests | (2,804) | (1,311) | [Condensed Consolidated Statement of Financial Position](index=31&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, Yida China's total assets were RMB 33.883 billion, largely stable from year-end 2024, while total liabilities increased to RMB 27.261 billion, with current liabilities reaching RMB 24.985 billion, expanding the net current liabilities to RMB 11.585 billion. Condensed Consolidated Statement of Financial Position Summary (As of June 30, 2025) | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Assets** | | | | Total Non-current Assets | 20,482,986 | 20,649,343 | | Investment Properties | 16,206,539 | 16,340,772 | | Prepayments for Land Acquisitions | 2,985,975 | 2,985,975 | | Total Current Assets | 13,400,044 | 13,230,643 | | Completed Properties Held for Sale | 8,643,961 | 7,498,371 | | Cash and Cash Equivalents | 185,953 | 156,254 | | Restricted Cash | 254,919 | 217,548 | | **Liabilities** | | | | Total Non-current Liabilities | 2,275,475 | 2,308,088 | | Total Current Liabilities | 24,985,337 | 24,170,923 | | Interest-bearing Bank and Other Borrowings (Current) | 11,551,811 | 11,618,346 | | Other Payables and Accrued Charges | 5,580,902 | 5,046,744 | | **Equity** | | | | Total Equity | 6,622,218 | 7,400,975 | | Net Current Liabilities | (11,585,293) | (10,940,280) | - Net current liabilities expanded from **RMB 10.940 billion** at the end of 2024 to **RMB 11.585 billion**, indicating further increased liquidity pressure[103](index=103&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=33&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, Yida China's total equity decreased from RMB 7.401 billion at the beginning of the year to RMB 6.622 billion, primarily due to a net loss of RMB 776 million attributable to owners of the company. Condensed Consolidated Statement of Changes in Equity Summary (For the six months ended June 30, 2025) | Indicator | January 1, 2025 (RMB thousand) | Loss for the Period (RMB thousand) | June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | :--- | | Total Equity Attributable to Owners of the Company | 7,265,501 | (775,538) | 6,489,548 | | Non-controlling Interests | 135,474 | (2,804) | 132,670 | | **Total Equity** | **7,400,975** | **(778,342)** | **6,622,218** | - The decrease in total equity is primarily attributable to the net loss recorded during the period[104](index=104&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=34&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, Yida China's net cash flow from operating activities significantly increased to RMB 252 million, while net cash used in investing activities was RMB 31.165 million and net cash used in financing activities was RMB 191 million. Condensed Consolidated Statement of Cash Flows Summary (For the six months ended June 30, 2025) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net Cash Flows from Operating Activities | 251,653 | 124,339 | | Net Cash Flows (Used in)/Generated from Investing Activities | (31,165) | 105,559 | | Net Cash Flows Used in Financing Activities | (190,789) | (225,481) | | Net Increase in Cash and Cash Equivalents | 29,699 | 4,417 | | Cash and Cash Equivalents at End of Period | 185,953 | 179,464 | - Net cash flow from operating activities significantly increased year-on-year, mainly due to a decrease in properties under development, a decrease in completed properties held for sale, and an increase in trade payables and contract liabilities[106](index=106&type=chunk) - Investing activities shifted from cash inflow in the prior year to cash outflow, primarily due to an increase in restricted cash[107](index=107&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=36&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes to the condensed consolidated financial statements, covering company and group information, basis of preparation, accounting policies, and financial risk management. [Company and Group Information](index=36&type=section&id=Company%20and%20Group%20Information) Yida China Holdings Limited was incorporated in the Cayman Islands in 2007 and primarily engages in property development, property investment, business park operations management, and construction in mainland China. - The Company was incorporated in the Cayman Islands on November 26, 2007, as an investment holding company[108](index=108&type=chunk) - The Group primarily engages in property development, property investment, business park operations management, property construction, decoration, and landscaping in mainland China[108](index=108&type=chunk) - The holding company is Jiayou (International) Investment Co., Ltd., and the ultimate holding company is China Minsheng Investment Corp., Ltd[108](index=108&type=chunk) [Basis of Preparation](index=36&type=section&id=Basis%20of%20Preparation) The condensed consolidated financial statements are prepared in accordance with HKAS 34 and should be read in conjunction with the annual consolidated financial statements, with significant going concern uncertainties highlighted. - As of June 30, 2025, the Group's current liabilities exceeded current assets by **RMB 11.585 billion**, with current borrowings of **RMB 11.552 billion** and cash and cash equivalents of only **RMB 186 million**[110](index=110&type=chunk) - As of June 30, 2025, borrowings with an aggregate principal amount of **RMB 6.445 billion** remained unsettled[110](index=110&type=chunk) - Dalian Shengbei Development Co., Ltd., a subsidiary, failed to repay overdue loan principal of approximately **RMB 194 million**, resulting in an enforcement notice from the Shanghai Financial Court[110](index=110&type=chunk) - The Group failed to fulfill its settlement agreement with Andu, with an outstanding balance (including accrued interest) of **RMB 1.523 billion** payable to Andu, which may file a winding-up petition with the court[111](index=111&type=chunk) - These default events could lead to immediate repayment demands for certain other borrowings totaling **RMB 5.107 billion**[111](index=111&type=chunk) - Management has formulated plans and measures, including negotiating with Andu, renewing and extending loan repayments with lenders, accelerating property sales and collections, and seeking asset disposals, to mitigate liquidity pressure[112](index=112&type=chunk)[114](index=114&type=chunk) - Despite mitigation measures, significant uncertainties remain regarding the Group's ability to continue as a going concern[115](index=115&type=chunk)[118](index=118&type=chunk) [Accounting Policies](index=39&type=section&id=Accounting%20Policies) The accounting policies adopted in these condensed consolidated financial statements are consistent with those of the 2024 annual consolidated financial statements, with no material impact from new or revised HKFRSs. - The accounting policies adopted in preparing the condensed consolidated financial statements are consistent with those of the 2024 annual consolidated financial statements, with no material impact or retrospective adjustments required[116](index=116&type=chunk) - There are no new or revised Hong Kong Financial Reporting Standards, amendments to existing standards, or interpretations that are not yet effective and are expected to have a significant impact on the Group's financial position and operating results[117](index=117&type=chunk) [Critical Accounting Judgments and Key Sources of Estimation Uncertainty](index=40&type=section&id=Critical%20Accounting%20Judgments%20and%20Key%20Sources%20of%20Estimation%20Uncertainty) The preparation of condensed consolidated financial statements requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and reported amounts. - The preparation of financial statements requires management to make judgments, estimates, and assumptions, and actual results may differ from these estimates[119](index=119&type=chunk) - The significant judgments and estimates made during the period are consistent with those applied in the 2024 annual financial statements[119](index=119&type=chunk) [Financial Risk Management Objectives and Policies](index=40&type=section&id=Financial%20Risk%20Management%20Objectives%20and%20Policies) The Group faces market, interest rate, foreign currency, credit, and liquidity risks, which are monitored, but no foreign currency hedging policy is currently in place. [Market Risk](index=40&type=section&id=Market%20Risk) The Group's assets primarily consist of land held for development for sale, investment properties, properties under development, and completed properties held for sale, which may not be immediately realizable if the property market significantly declines. - The Group's assets are primarily property-related, and a significant downturn in the property market may prevent immediate realization of these assets[121](index=121&type=chunk) [Interest Rate Risk](index=40&type=section&id=Interest%20Rate%20Risk) The Group's primary interest rate risk stems from long-term debt obligations, with floating-rate borrowings exposed to cash flow interest rate risk and fixed-rate borrowings to fair value interest rate risk. - The Group's primary interest rate risk relates to long-term debt obligations, with floating-rate borrowings exposed to cash flow interest rate risk and fixed-rate borrowings to fair value interest rate risk[123](index=123&type=chunk) - The Group does not use any interest rate swaps to hedge interest rate risk[123](index=123&type=chunk) Interest Rate Sensitivity Analysis (Impact on Loss Before Income Tax) | Currency | Basis Point Increase/(Decrease) | June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | | RMB | 50 | (1,425) | | RMB | (50) | 1,425 | [Foreign Currency Risk](index=41&type=section&id=Foreign%20Currency%20Risk) The Group's functional currency is RMB, but it holds USD and HKD-denominated short-term deposits and borrowings, exposing it to foreign currency risk, with no current hedging policy. - The Group's functional currency is RMB, but it holds USD and HKD-denominated financial assets and liabilities, exposing it to foreign currency risk[126](index=126&type=chunk) - The Chinese government imposes controls on the conversion of RMB into foreign currencies and the remittance of foreign currencies out of mainland China, which may affect the Group's ability to obtain necessary foreign exchange[125](index=125&type=chunk)[126](index=126&type=chunk) - The Group currently has no foreign currency hedging policy[127](index=127&type=chunk) - A **9% depreciation/appreciation** of RMB against USD would result in an increase/decrease in loss before income tax for the period of **RMB 272 million**, respectively[127](index=127&type=chunk) [Credit Risk](index=42&type=section&id=Credit%20Risk) The Group's credit risk primarily arises from trade receivables and other receivables, managed through expected credit loss provisions. - The Group's credit risk primarily arises from trade receivables and other receivables, managed through expected credit loss provisions[128](index=128&type=chunk) Impairment Provision for Trade Receivables (June 30, 2025) | Ageing | Expected Loss Rate | Gross Carrying Amount (RMB thousand) | Expected Credit Loss Provision (RMB thousand) | | :--- | :--- | :--- | :--- | | Within one year | 7.34% | 276,059 | 20,267 | | One to two years | 15.54% | 71,559 | 11,120 | | Over two years | 74.39% | 141,621 | 105,356 | | **Total** | | **489,239** | **136,743** | Impairment Provision for Other Receivables (June 30, 2025) | Category | Expected Credit Loss Rate | Gross Carrying Amount (RMB thousand) | Loss Provision (RMB thousand) | | :--- | :--- | :--- | :--- | | Amounts due from related parties (Stage 1) | 0.10% | 32,222 | (32) | | Receivables for primary land development (Stage 3) | 52.85% | 737,321 | (389,697) | | Others (Stage 1) | 0.94% | 318,597 | (2,996) | | Others (Stage 3) | 73.93% | 139,858 | (103,392) | | **Total** | | **1,227,998** | **(496,117)** | [Liquidity Risk](index=46&type=section&id=Liquidity%20Risk) The Group monitors funding shortage risk using liquidity planning tools and balances funding through bank and other borrowings, with most financial liabilities due within one year or on demand. - The Group uses liquidity planning tools to monitor funding shortage risk and balances funding through bank and other borrowings[135](index=135&type=chunk) Maturity Analysis of Financial Liabilities (June 30, 2025) | Liability Category | On Demand or Within One Year (RMB thousand) | Second Year (RMB thousand) | Total (RMB thousand) | | :--- | :--- | :--- | :--- | | Interest-bearing Bank and Other Borrowings | 12,064,690 | 56,674 | 12,121,364 | | Trade Payables | 3,488,702 | – | 3,488,702 | | Other Payables and Accrued Charges | 5,004,493 | – | 5,004,493 | | Lease Liabilities | 2,416 | 1,501 | 9,068 | | **Total** | **20,560,301** | **58,175** | **20,623,627** | | Maximum Amount of Financial Guarantees Issued | 181,163 | – | 181,163 | [Capital Management](index=47&type=section&id=Capital%20Management) The Group's capital management aims to ensure continuous operation, maintain a sound capital ratio, and generate returns for shareholders, with a net gearing ratio of 168.6% as of June 30, 2025. - Capital management objectives are to ensure the ability to continue as a going concern, maintain a sound capital ratio, and generate returns for shareholders[137](index=137&type=chunk) - The Group monitors capital using the net gearing ratio, calculated as net debt divided by total equity[137](index=137&type=chunk) Net Gearing Ratio | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net Debt | 11,164,473 | 11,297,082 | | Total Equity | 6,622,218 | 7,400,975 | | Net Gearing Ratio | 168.6% | 152.6% | [Operating Segment Information](index=48&type=section&id=Operating%20Segment%20Information) The Group is organized into five reportable operating segments: property development, property investment, business park operations management, construction, decoration and landscaping, and other segments, with management monitoring each segment's performance for resource allocation. - The Group is divided into five reportable operating segments: property development, property investment, business park operations management, construction, decoration and landscaping, and other segments[138](index=138&type=chunk)[140](index=140&type=chunk) Segment Results (For the six months ended June 30, 2025) | Segment | Revenue (RMB thousand) | Segment Results (RMB thousand) | | :--- | :--- | :--- | | Property Development | 212,200 | (218,963) | | Property Investment | 216,387 | 22,900 | | Business Park Operations Management | 86,889 | (587) | | Construction, Decoration and Landscaping | 184,932 | (5,296) | | Others | – | (1,389) | | **Total** | **700,408** | **(203,335)** | - No geographical information is presented as all external customer revenue and most segment assets are located in mainland China[142](index=142&type=chunk) [Revenue](index=50&type=section&id=Revenue) The Group's revenue sources include property sales, rental income, business park operations management services, and construction, decoration and landscaping, totaling RMB 700 million for the six months ended June 30, 2025. - Revenue sources include property sales, rental income, business park operations management service income, and construction, decoration and landscaping income[143](index=143&type=chunk) Revenue Analysis (For the six months ended June 30, 2025) | Revenue Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue from contracts with customers recognized at a point in time (Property sales) | 212,200 | 175,623 | | Revenue from contracts with customers recognized over time (Services) | 271,821 | 247,644 | | Revenue from other sources (Rental) | 216,387 | 243,798 | | **Total Revenue** | **700,408** | **667,065** | [Other Income](index=51&type=section&id=Other%20Income) For the six months ended June 30, 2025, the Group's other income totaled RMB 2.641 million, primarily comprising interest income and government grants, representing a decrease from the same period in 2024. Other Income Breakdown (For the six months ended June 30, 2025) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest Income | 436 | 444 | | Government Grants | 2,205 | 4,721 | | **Total** | **2,641** | **5,165** | [Expenses by Nature](index=51&type=section&id=Expenses%20by%20Nature) For the six months ended June 30, 2025, the Group's total cost of sales, selling and marketing expenses, and administrative expenses amounted to RMB 679 million, a significant increase from RMB 559 million in the prior year. Analysis of Expenses by Nature (For the six months ended June 30, 2025) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of Properties Sold | 257,497 | 171,599 | | Cost of Other Services Provided | 250,659 | 239,260 | | Direct Operating Expenses Arising from Investment Properties that Generate Rental Income | 92,551 | 66,859 | | Employee Benefit Expenses | 30,955 | 34,505 | | Depreciation | 5,317 | 6,602 | | Amortization of Intangible Assets | 1,573 | 2,585 | | Advertising | 2,605 | 2,106 | | Other Fees and Expenses | 37,346 | 34,388 | | **Total** | **679,379** | **559,336** | [Other Net Losses](index=52&type=section&id=Other%20Net%20Losses) For the six months ended June 30, 2025, the Group recorded other net losses of approximately RMB 102 million, a significant increase from RMB 58.461 million in the prior year, primarily due to late payment penalties. Other Net Losses Breakdown (For the six months ended June 30, 2025) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net Foreign Exchange Gain/(Loss) | 14,307 | (19,590) | | Late Payment Penalties | (119,748) | – | | Others | 3,641 | (38,871) | | **Total** | **(101,800)** | **(58,461)** | - The increase in other net losses was mainly due to **RMB 119 million** in late payment penalties incurred during the period[147](index=147&type=chunk) [Finance Costs](index=52&type=section&id=Finance%20Costs) For the six months ended June 30, 2025, the Group's finance costs totaled RMB 505 million, an increase from RMB 400 million in the prior year, primarily due to higher interest on bank and other borrowings and reduced capitalized interest. Finance Costs Breakdown (For the six months ended June 30, 2025) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 556,028 | 529,166 | | Interest on Lease Liabilities | 386 | 537 | | Less: Capitalized Interest | (50,981) | (129,917) | | **Total** | **505,433** | **399,786** | - The increase in finance costs was mainly due to higher interest expenses and reduced capitalized interest[148](index=148&type=chunk) [Income Tax Expense](index=53&type=section&id=Income%20Tax%20Expense) For the six months ended June 30, 2025, the Group's income tax expense significantly increased to RMB 70.01 million, a 332.4% rise from RMB 16.191 million in the prior year, primarily due to higher land appreciation tax provision. Income Tax Expense Analysis (For the six months ended June 30, 2025) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | China Corporate Income Tax | 9,982 | 7,418 | | China Land Appreciation Tax | 90,190 | (494) | | Deferred Tax (Current Period) | (30,162) | 9,267 | | **Total Tax Expense for the Period** | **70,010** | **16,191** | - The significant increase in income tax expense was mainly due to higher land appreciation tax provision resulting from land appreciation tax settlement for properties sold during the period[150](index=150&type=chunk) [Interim Dividend](index=53&type=section&id=Interim%20Dividend) The Company resolved not to declare any interim dividend for the six months ended June 30, 2025, consistent with the prior year. - The Company resolved not to declare any interim dividend for the six months ended June 30, 2025[151](index=151&type=chunk) [Loss Per Share Attributable to Ordinary Equity Holders of the Company](index=53&type=section&id=Loss%20Per%20Share%20Attributable%20to%20Ordinary%20Equity%20Holders%20of%20the%20Company) For the six months ended June 30, 2025, the basic and diluted loss per share attributable to ordinary equity holders of the Company was RMB 30.01 cents, an increase from RMB 13.94 cents in the prior year. Loss Per Share (For the six months ended June 30, 2025) | Indicator | 2025 (RMB cents) | 2024 (RMB cents) | | :--- | :--- | :--- | | Basic and Diluted Loss Per Share | (30.01) | (13.94) | - The calculation of basic loss per share is based on the loss for the period attributable to ordinary equity holders of the Company of **RMB 776 million** and the weighted average of **2.584 billion** ordinary shares in issue during the periods[152](index=152&type=chunk) [Property, Plant and Equipment](index=53&type=section&id=Property%2C%20Plant%20and%20Equipment) As of June 30, 2025, buildings valued at RMB 9.883 million were pledged to financial institutions as security for loans granted to the Group. - As of June 30, 2025, buildings valued at **RMB 9.883 million** were pledged to financial institutions as security for loans granted to the Group[153](index=153&type=chunk) [Investment Properties](index=54&type=section&id=Investment%20Properties) As of June 30, 2025, the Group's investment properties totaled RMB 16.207 billion, slightly down from the beginning of the year, with a net fair value adjustment loss of RMB 124 million due to tenant departures. Movement in Investment Properties (As of June 30, 2025) | Item | Amount (RMB thousand) | | :--- | :--- | | At January 1, 2025 | 16,340,772 | | Additions | 152 | | Disposals | (10,486) | | Net Loss from Fair Value Adjustment | (123,899) | | At June 30, 2025 | 16,206,539 | - The net loss from fair value adjustment was mainly due to business relocation of certain international clients and cost-saving requirements by some clients to move operations to lower-cost regions, leading to multiple tenant departures from the parks during the period[52](index=52&type=chunk)[154](index=154&type=chunk) - Investment properties valued at **RMB 14.130 billion** were pledged to banks as collateral for loans granted to the Group[154](index=154&type=chunk) - Some investment properties are subject to sale and transfer restrictions, requiring them to be held for at least **15 years**[155](index=155&type=chunk) [Land Held for Development for Sale](index=55&type=section&id=Land%20Held%20for%20Development%20for%20Sale) As of June 30, 2025, the Group's land held for development for sale had a carrying amount of RMB 790 million, with RMB 728 million pledged to banks as security for loans. Movement in Land Held for Development for Sale (As of June 30, 2025) | Item | Amount (RMB thousand) | | :--- | :--- | | Carrying amount at beginning of period/year | 789,963 | | Additions | 486 | | Carrying amount at end of period/year | 790,449 | - Land held for development for sale valued at **RMB 728 million** was pledged to banks as security for bank and other loans granted to the Group[157](index=157&type=chunk) [Prepayments, Deposits and Other Receivables](index=55&type=section&id=Prepayments%2C%20Deposits%20and%20Other%20Receivables) As of June 30, 2025, the Group's total carrying amount of prepayments, deposits, and other receivables was RMB 1.203 billion, with a non-current portion of RMB 348 million. Prepayments, Deposits and Other Receivables (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Prepayments | 471,373 | 467,137 | | Gross Deposits and Other Receivables | 1,227,998 | 1,344,453 | | Less: Impairment Provision | (496,117) | (496,580) | | **Carrying Amount at End of Period/Year** | **1,203,254** | **1,315,010** | | Current Portion | (855,630) | (948,173) | | Non-current Portion | 347,624 | 366,837 | - Other receivables include amounts due from associates of **RMB 32.149 million** and amounts due from joint ventures of **RMB 5.98 million**[158](index=158&type=chunk)[159](index=159&type=chunk) - Other receivables include amounts advanced to local government authorities for primary land development of certain land parcels in Dalian, China, totaling **RMB 348 million**[159](index=159&type=chunk) [Trade Receivables](index=56&type=section&id=Trade%20Receivables) As of June 30, 2025, the Group's total trade receivables amounted to RMB 558 million, with an impairment provision of RMB 182 million, resulting in a net amount of RMB 375 million. Trade Receivables (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Gross Trade Receivables | 557,623 | 502,814 | | Less: Impairment Provision | (182,493) | (180,428) | | **Net Amount** | **375,130** | **322,386** | Ageing Analysis of Trade Receivables (As of June 30, 2025) | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 276,059 | 205,416 | | One to two years | 71,559 | 54,475 | | Over two years | 210,005 | 242,923 | | **Total** | **557,623** | **502,814** | [Cash and Cash Equivalents and Restricted Cash](index=57&type=section&id=Cash%20and%20Cash%20Equivalents%20and%20Restricted%20Cash) As of June 30, 2025, the Group's total cash and bank balances were RMB 441 million, comprising restricted cash of RMB 255 million and cash and cash equivalents of RMB 186 million. Cash and Cash Equivalents and Restricted Cash (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Cash and Bank Balances | 440,872 | 373,802 | | Less: Restricted Cash | (254,919) | (217,548) | | **Cash and Cash Equivalents** | **185,953** | **156,254** | - Restricted cash includes guarantee deposits from property pre-sale proceeds placed in designated bank accounts (**RMB 24.82 million**) and deposits placed in designated bank accounts according to contracts and local government regulations (**RMB 230 million**)[164](index=164&type=chunk) [Contract Liabilities](index=57&type=section&id=Contract%20Liabilities) The Group's contract liabilities primarily represent amounts received from pre-sale property buyers and amounts payable to contract customers at the end of the reporting period. - Contract liabilities primarily represent amounts received from pre-sale property buyers and amounts payable to contract customers[163](index=163&type=chunk) Contract Liabilities (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Contract Liabilities | 1,367,420 | 1,253,652 | [Trade Payables](index=58&type=section&id=Trade%20Payables) As of June 30, 2025, the Group's total trade payables were RMB 3.489 billion, an increase from RMB 3.345 billion at the end of 2024, with a significant portion due within one year. Ageing Analysis of Trade Payables (As of June 30, 2025) | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 1,721,783 | 2,231,487 | | Over one year | 1,766,919 | 1,113,431 | | **Total** | **3,488,702** | **3,344,918** | - Trade payables are interest-free and unsecured[165](index=165&type=chunk) [Other Payables and Accrued Charges](index=58&type=section&id=Other%20Payables%20and%20Accrued%20Charges) As of June 30, 2025, the Group's total other payables and accrued charges amounted to RMB 5.581 billion, an increase from RMB 5.047 billion at the end of 2024, including RMB 1.523 billion payable to Andu. Other Payables and Accrued Charges (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee Benefits Payable | 107,995 | 108,514 | | Accrued Charges | 2,027,155 | 1,716,610 | | Other Payables | 3,445,752 | 3,221,620 | | **Carrying Amount at End of Period/Year** | **5,580,902** | **5,046,744** | - Other payables include amounts due to Andu of **RMB 1.523 billion**, bearing an annual interest rate of **21.9%**, and the Group's failure to fulfill the settlement agreement may lead to a winding-up petition by Andu[166](index=166&type=chunk) [Interest-bearing Bank and Other Borrowings](index=59&type=section&id=Interest-bearing%20Bank%20and%20Other%20Borrowings) As of June 30, 2025, the Group's total interest-bearing bank and other borrowings were RMB 11.605 billion, with the current portion being RMB 11.552 billion, largely due within one year or on demand. Interest-bearing Bank and Other Borrowings (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Current** | | | | Secured Bank Loans | 5,072,665 | 5,340,153 | | Secured Other Borrowings | 4,263,965 | 4,119,741 | | Unsecured Other Borrowings | 2,215,181 | 2,158,452 | | **Non-current** | | | | Unsecured Other Borrowings | 53,534 | 52,538 | | **Total** | **11,605,345** | **11,670,884** | - The current portion includes principal amounts of **RMB 2.544 billion** of borrowings originally due after June 30, 2026, reclassified as current liabilities due to going concern uncertainties[168](index=168&type=chunk) - Certain bank and other loans of the Group are secured by properties under development, investment properties, land held for development for sale, completed properties held for sale, buildings, or corporate guarantees[170](index=170&type=chunk) - The senior notes defaulted due to failure to pay consent fees and interest, leading to accelerated repayment, with a carrying amount of **RMB 1.782 billion**[168](index=168&type=chunk)[169](index=169&type=chunk) - Other borrowings include loans from related parties (Shanghai Jiayue Medical Investment Management Co., Ltd. and Jiahua (Holdings) Investment Co., Ltd.) with a principal amount of **RMB 663 million**[170](index=170&type=chunk) [Share Capital](index=62&type=section&id=Share%20Capital) As of June 30, 2025, the Company's authorized share capital was 50 billion shares of US$0.01 par value each, with 2.584 billion issued and fully paid ordinary shares, totaling RMB 159 million. Share Capital (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Authorized Share Capital (50 billion shares of US$0.01 par value each) | 3,124,300 | 3,124,300 | | Issued and Fully Paid Share Capital (2.584 billion shares of US$0.01 par value each) | 159,418 | 159,418 | [Financial Guarantees](index=62&type=section&id=Financial%20Guarantees) As of June 30, 2025, the Group's financial guarantees included a maximum liability of RMB 132 million for property buyers' mortgage financing and RMB 48.781 million for joint venture bank loans. - The Group's maximum liability for mortgage financing provided to property buyers is **RMB 132 million**[172](index=172&type=chunk) - The Group provided guarantees for bank loans granted to its joint ventures amounting to **RMB 48.781 million**[172](index=172&type=chunk) - The Directors believe that the fair value of the financial guarantee contracts was not material upon initial recognition, and the likelihood of default is very low, thus no value has been recognized[173](index=173&type=chunk) [Pledged Assets](index=63&type=section&id=Pledged%20Assets) The Group's bank and other loans are secured by various pledged assets, as detailed in Note 24, "Interest-bearing Bank and Other Borrowings". - The Group's bank and other loans are secured by various pledged assets, details of which are set out in Note 24[174](index=174&type=chunk) [Operating Lease Arrangements as Lessor](index=63&type=section&id=Operating%20Lease%20Arrangements%20as%20Lessor) The Group leases out its investment properties under operating lease arrangements with lease terms ranging from one to twenty years, with total future minimum rentals receivable of RMB 740 million as of June 30, 2025. - The Group leases out its investment properties under operating lease arrangements, with lease terms ranging from **one to twenty years**[175](index=175&type=chunk) Total Future Minimum Rentals (As of June 30, 2025) | Period | Amount (RMB thousand) | | :--- | :--- | | Within one year | 213,293 | | In the second to fifth years | 319,289 | | After five years | 207,187 | | **Total** | **739,769** | [Commitments](index=63&type=section&id=Commitments) As of June 30, 2025, the Group's total contracted but unprovided capital commitments amounted to RMB 3.126 billion, primarily for capital expenditures on investment properties under construction and properties under development in mainland China. Capital Commitments (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Capital expenditure for investment properties under construction and properties under development | 3,120,765 | 3,285,535 | | Capital contribution to a joint venture | 5,040 | 5,040 | | **Total** | **3,125,805** | **3,290,575** | [Related Party Transactions](index=64&type=section&id=Related%20Party%20Transactions) Aside from transactions already detailed in other sections of the condensed consolidated financial statements, there were no other significant related party transactions for the six months ended June 30, 2025 and 2024. - Aside from the transactions already detailed, there were no other significant related party transactions during the period[178](index=178&type=chunk) [Financial Instruments by Category](index=64&type=section&id=Financial%20Instruments%20by%20Category) As of June 30, 2025, the Group's total financial assets measured at amortized cost were RMB 1.548 billion, while total financial liabilities measured at amortized cost were RMB 20.105 billion. Financial Assets Measured at Amortized Cost (As of June 30, 2025) | Item | Amount (RMB thousand) | | :--- | :--- | | Trade Receivables | 375,130 | | Deposits and Other Receivables | 731,881 | | Restricted Cash | 254,919 | | Cash and Cash Equivalents | 185,953 | | **Total** | **1,547,883** | Financial Liabilities Measured at Amortized Cost (As of June 30, 2025) | Item | Amount (RMB thousand) | | :--- | :--- | | Trade Payables | 3,488,702 | | Other Payables and Accrued Charges | 5,004,493 | | Interest-bearing Bank and Other Borrowings | 11,605,345 | | Lease Liabilities | 6,714 | | **Total** | **20,105,254** | [Fair Value and Fair Value Hierarchy of Financial Instruments](index=66&type=section&id=Fair%20Value%20and%20Fair%20Value%20Hierarchy%20of%20Financial%20Instruments) As of June 30, 2025, the Group's assets measured at fair value primarily consisted of investment properties, totaling RMB 15.695 billion, all classified as Level 3 in the fair value hierarchy. Assets Measured at Fair Value (June 30, 2025) | Item | Level 1 (RMB thousand) | Level 2 (RMB thousand) | Level 3 (RMB thousand) | Total (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | Investment Properties | – | – | 15,694,768 | 15,694,768 | - The fair value measurement of investment properties uses internal valuations and involves external valuers, classified as Level 3 in the fair value hierarchy[184](index=184&type=chunk)[185](index=185&type=chunk) - The fair values of other receivables and the non-current portion of interest-bearing bank and other borrowings approximate their carrying amounts[183](index=183&type=chunk) [Definitions](index=68&type=section&id=Definitions) This section provides definitions for key terms and abbreviations used in the report to ensure a clear understanding of its content

Financial Performance - Revenue for the six months ended June 30, 2025, was HK$103,007,000, a significant increase of 124.5% compared to HK$45,999,000 for the same period in 2024[13] - Gross profit for the reporting period was HK$16,054,000, down 11% from HK$18,031,000 in the prior year[13] - Operating profit decreased to HK$3,079,000, a decline of 71.6% from HK$10,843,000 in the first half of 2024[13] - Profit for the period was HK$1,540,000, representing a decrease of 84.5% compared to HK$9,949,000 in the same period last year[13] - Total comprehensive income for the period was HK$3,667,000, down 54.7% from HK$8,109,000 in the previous year[15] - Basic and diluted earnings per share decreased to 0.2 HK cents from 1.2 HK cents in the first half of 2024[15] - The profit for the period ended June 30, 2025, was HK$1,540,000, compared to HK$9,949,000 for the same period in the previous year, indicating a decrease of approximately 84.5%[21] - Profit attributable to owners of the Company was approximately HK$1.5 million for the Reporting Period, down from approximately HK$9.9 million for 1H 2024[160] Expenses and Costs - Selling and distribution expenses increased to HK$3,532,000, up 243.5% from HK$1,028,000 in 2024[13] - Administrative expenses rose to HK$8,564,000, an increase of 14% from HK$7,531,000 in the previous year[13] - Finance costs increased significantly to HK$946,000 from HK$10,000 in the same period last year[13] - The cost of inventories and consumables rose sharply to HK$82,197,000 in 2025 from HK$23,055,000 in 2024, indicating an increase of about 257%[51] - The Group's costs of sales increased by approximately 210.7% or HK$59.0 million to HK$87.0 million for the Reporting Period, primarily due to increased revenue from machinery and minerals[152] Assets and Liabilities - As of June 30, 2025, total assets increased to HK$169,454,000 from HK$167,967,000 as of December 31, 2024, representing a growth of approximately 0.87%[16] - Current assets rose to HK$141,003,000, up from HK$145,088,000, indicating a decrease of about 2.5%[18] - Trade receivables increased significantly to HK$33,060,000, compared to HK$24,764,000, reflecting a growth of approximately 33.5%[16] - Total equity attributable to owners of the Company reached HK$139,097,000, up from HK$135,430,000, marking an increase of about 2.47%[21] - Non-current liabilities decreased to HK$1,522,000 from HK$2,162,000, a reduction of approximately 29.6%[18] - Current liabilities decreased to HK$28,835,000 from HK$30,375,000, showing a decline of about 5.1%[18] Cash Flow - For the six months ended June 30, 2025, the company reported a net cash used in operating activities of HK$8,382,000, a significant decrease from the net cash generated of HK$8,304,000 in the same period of 2024[29] - The company incurred a net cash used in investing activities of HK$10,280,000, compared to only HK$129,000 in the prior year, primarily due to the acquisition of a life insurance contract costing HK$8,528,000[29] - Financing activities generated a net cash inflow of HK$10,781,000, a recovery from a net cash outflow of HK$24,247,000 in the previous year, largely due to bank borrowings raised amounting to HK$46,713,000[29] - The total cash and cash equivalents at the end of the period were HK$51,362,000, an increase from HK$38,748,000 at the end of June 2024[29] - Cash and cash equivalents decreased to HK$51,362,000 from HK$59,452,000, a decline of about 13.5%[16] Business Operations - The company is an investment holding company primarily engaged in the manufacturing and trading of slewing rings, mechanical parts, and components, as well as trading of machineries and minerals[31] - The Group is a leading premium slewing ring manufacturer in the PRC, also providing mechanical parts and components for construction and mining sites[93] - The Group expanded its product offerings to include mechanical parts such as sprockets, track shoes, and rollers, alongside slewing rings, on an ODM basis[95] - The Group has developed new products since 2020 to meet customer needs and seize business opportunities[94] - The Group has been supplying slewing rings under OEM basis to leading suppliers in Japan for over 10 years, enhancing its sourcing capabilities[95] Market Conditions - The global economic situation has continued to deteriorate in 2025, affecting the Group's business environment[97] - The economic recovery in Hong Kong and the PRC has not met expectations due to various challenges, including the property market slump[97] - The overall economic environment remains challenging, with high interest rates and uncertainties affecting global business conditions[99] - The Group's management emphasizes the importance of identifying new business opportunities to navigate market competition and economic uncertainties[99] Shareholder Returns - The company paid dividends totaling HK$16,000,000 during the period[21] - The Board does not recommend the payment of an interim dividend for the reporting period, reflecting a conservative approach to cash distribution[60] - The Board does not recommend the payment of an interim dividend for the reporting period, consistent with the previous year[188] Regulatory and Compliance - The company is currently assessing the impact of new accounting standards that have been issued but are not yet effective, which may affect future reporting periods[37] - The company’s legal reserve requires a minimum allocation of 10% of the after-tax profits before distributing dividends to shareholders, ceasing once the total reserve exceeds 50% of the registered capital[26] - The company has not established any agreements or purchased instruments to hedge against foreign exchange risks, primarily involving USD and RMB[189] - The company closely monitors exchange rate fluctuations to manage foreign exchange risks[189] - The directors believe that foreign exchange risk related to USD is not significant due to the peg of HKD to USD[190] Employee and Management - As of June 30, 2025, the Group had 97 employees, an increase from 84 employees as of December 31, 2024[175] - Key management compensation for the six months ended June 30, 2025, was HK$1,437,000, an increase from HK$1,329,000 in the same period of 2024[87]