C M Y CM MY CY CMY K ai175668753012_Kuaishou IR2025 Cover 6.5mm CN OP.pdf 1 1/9/2025 上午8:45 目錄 | 公司資料 | 2 | | --- | --- | | 摘要 | 4 | | 主席報告 | 8 | | 管理層討論與分析 | 15 | | 其他資料 | 32 | | 中期財務資料的審閱報告 | 56 | | 簡明合併損益表 | 57 | | 簡明合併綜合收益表 | 58 | | 簡明合併資產負債表 | 59 | | 簡明合併權益變動表 | 61 | | 簡明合併現金流量表 | 63 | | 簡明合併中期財務資料附註 | 64 | | 釋義 | 103 | 李朝暉先生 張斐先生 林欣禾先生 （於2025年1月22日辭任） 王慧文先生 獨立非執行董事 黃宣德先生 馬寅先生 肖星教授 （於2025年4月28日辭任） 盧蓉女士 （於2025年4月28日獲委任） 審核委員會 黃宣德先生 （主席） 馬寅先生 肖星教授 （於2025年4月28日辭任） 盧蓉女士 （於2025年4月28日獲委任） 薪酬委員會 公司資料 董事會 執行董事 ...

Wisdom Education International Holdings Company Limited 光正教育國際控股有限公司 （於 開 曼 群 島 註 冊 成 立 的 有 限 公 司） （股 份 代 號：6068） 香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不 就 因 本 公 告 全部或任何部分內容所產生或因依賴該等內容而引致的任何損失承擔任何責 任。 – 1 – 2024年報所披露的應收貸款 董 事 會 亦 宣 佈，於2024年報所披露截至2024年12月31日止年度的所有應收貸款 金額人民幣126,329,000元已於2025年8月 前 悉 數 償 還，於 本 公 告 日 期 概 無 有 關 貸 款 仍 未 償 還。 自願性公告 悉數償還該等貸款 茲提述本公司日期為2025年7月22日的公告（「該公告」），內 容 有 關（其 中 包 括）提 供該等貸款的須予披露交易及本公司於2024年12月18日刊發截至2024年12月31 日止年度的年報（「2024年 報」）所 披 ...

Financial Performance - For the six months ended June 30, 2025, the group's revenue was approximately HKD 44.5 million, an increase of about 11.6% compared to HKD 39.8 million for the same period in 2024[6]. - The gross profit margin for the six months ended June 30, 2025, was approximately 4.3%, down from 9.9% for the same period in 2024[6]. - The group reported a loss of approximately HKD 8.3 million for the six months ended June 30, 2025, compared to a loss of HKD 0.1 million for the same period in 2024[6]. - Basic loss per share for the six months ended June 30, 2025, was approximately HKD 2.89, compared to HKD 0.05 for the same period in 2024[6]. - The company experienced a net loss before tax of HKD 8,336,000 for the six months ended June 30, 2025, compared to a net loss of HKD 56,000 for the same period in 2024, indicating a significant decline in profitability[18][19]. - The company recorded a net loss of approximately HKD 8.3 million for the six months ending June 30, 2025, compared to a loss of about HKD 0.1 million for the same period in 2024[45]. Assets and Liabilities - Non-current assets as of June 30, 2025, amounted to HKD 30.6 million, an increase from HKD 29.0 million as of December 31, 2024[8]. - Current assets as of June 30, 2025, totaled HKD 66.6 million, slightly down from HKD 67.6 million as of December 31, 2024[8]. - Current liabilities increased to HKD 34.3 million as of June 30, 2025, compared to HKD 26.6 million as of December 31, 2024[8]. - Total equity as of June 30, 2025, was HKD 62.9 million, down from HKD 69.7 million as of December 31, 2024[8]. - The company's total assets as of June 30, 2025, were approximately HKD 97.6 million, compared to HKD 96.6 million as of December 31, 2024[49]. - The company's total equity attributable to owners decreased from HKD 76,618,000 as of January 1, 2024, to HKD 62,910,000 as of June 30, 2025, reflecting a decline of approximately 17.9%[9]. Revenue Breakdown - Revenue from China increased to HKD 35,001,000 in 2025 from HKD 33,830,000 in 2024, representing a growth of 3.5%[20]. - Other Asian regions, excluding Hong Kong and China, generated revenue of HKD 9,239,000 in 2025, up from HKD 5,726,000 in 2024, marking a significant increase of 61.8%[20]. - The gross profit from the sale of industrial aluminum electrolytic capacitors was HKD 35,353,000, while the profit from electronic component trading was HKD 9,113,000, contributing to a total segment profit of HKD 1,918,000[18]. - Revenue from the sale of industrial aluminum electrolytic capacitors rose from approximately HKD 33.7 million to approximately HKD 35.4 million[37]. Expenses and Cash Flow - The company experienced a significant increase in administrative expenses, which rose to HKD 9.1 million for the six months ended June 30, 2025, compared to HKD 6.3 million for the same period in 2024[7]. - Operating cash flow for the six months ended June 30, 2025, was HKD 6,381,000, a substantial increase from HKD 1,861,000 in the previous year, reflecting improved cash generation from operations[10]. - The company incurred total expenses of HKD 1,573,000 during the period, which included a loss of HKD 139,000 and foreign exchange losses of HKD 1,434,000[9]. - Sales costs increased by approximately 18.5%, rising from about HKD 35.9 million to approximately HKD 42.5 million[38]. Dividends and Shareholder Information - The board of directors did not recommend the payment of any dividend for the six months ended June 30, 2025, consistent with the previous year[6]. - The company did not declare or pay any dividends during the two periods[25]. - Major shareholders include Super Date Co., Ltd, holding 188,150,000 shares, representing 65.33% of the company's equity[61]. Corporate Governance and Compliance - The company has adopted trading compliance standards for directors, ensuring adherence to regulations regarding insider trading[64]. - The company has adhered to the corporate governance code as per GEM listing rules, except for deviation from C.2.1, which states that the roles of Chairman and CEO should be separate[68]. - The audit committee, consisting of three independent non-executive directors, has reviewed the unaudited interim results for the six months ending June 30, 2025[72]. Subsidiary and Business Development - The company established a subsidiary in Dubai to support new business development in SaaS solutions and innovative digital products[35]. - The Dubai subsidiary plans to utilize the proprietary internal algorithm system (PAS) to integrate AI, web3.0 token mechanisms, big data, and cloud computing technologies[36]. - The company aims to expand its influence in the Asia-Pacific, Middle East, and Europe regions through strong operational capabilities in Dubai[36]. Employment and Compensation - The total number of full-time employees increased from 134 to 151, with total compensation for the six months amounting to approximately HKD 11.8 million, up from HKD 9.5 million[54].

[Characteristics of the GEM Market and Report Statement](index=2&type=section&id=CHARACTERISTICS%20OF%20THE%20GEM) This section describes the GEM market's features for small and medium-sized companies, noting higher investment risks and market volatility, with directors fully responsible for report accuracy - The GEM market is positioned for small and medium-sized companies, carrying **higher investment risks** [2](index=2&type=chunk) - GEM securities may experience **significant market volatility** and do not guarantee high liquidity [3](index=3&type=chunk) - Directors assume **full responsibility** for the report's content, confirming its accuracy, completeness, and lack of misleading information [5](index=5&type=chunk) [Unaudited Interim Results](index=3&type=section&id=INTERIM%20RESULTS%20(UNAUDITED)) This section presents the company's unaudited condensed consolidated financial statements for the six months ended June 30, 2025, including statements of profit or loss, financial position, changes in equity, and cash flows, reflecting the group's financial performance and position during the period [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20PROFIT%20OR%20LOSS%20AND%20OTHER%20COMPREHENSIVE%20INCOME%20(UNAUDITED)) H1 2025 saw significant revenue growth, but operating and period losses widened substantially, influenced by joint venture/associate losses and tax credits Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Unaudited) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Revenue | 300,562 | 214,841 | **39.9% increase** | | Gross Profit | 47,689 | 31,810 | **49.9% increase** | | Operating Loss | (60,089) | (11,923) | **Loss widened** | | Loss Before Tax | (50,746) | (12,563) | **Loss widened** | | Income Tax Credit/(Expense) | 21,644 | (2,127) | **Switched from expense to credit** | | Loss for the Period | (29,102) | (14,690) | **Loss widened** | | Loss Attributable to Owners of the Company | (28,372) | (6,049) | **369.0% increase in loss** | | Basic and Diluted Loss Per Share (RMB cents per share) | (1.87) | (0.40) | **Loss widened** | [Condensed Consolidated Statement of Financial Position](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20FINANCIAL%20POSITION) As of June 30, 2025, total assets slightly decreased, non-current assets reduced, but net current assets significantly increased, while total equity remained stable Condensed Consolidated Statement of Financial Position | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Non-current Assets | 4,157,896 | 4,414,864 | **5.8% decrease** | | Current Assets | 1,172,380 | 1,101,413 | **6.4% increase** | | Total Assets | 5,330,276 | 5,516,277 | **3.4% decrease** | | Current Liabilities | 870,873 | 1,037,109 | **16.0% decrease** | | Net Current Assets | 301,507 | 64,304 | **369.0% increase** | | Non-current Liabilities | 498,783 | 514,365 | **3.0% decrease** | | Net Assets | 3,960,620 | 3,964,803 | **0.1% decrease** | | Equity Attributable to Owners of the Company | 3,710,875 | 3,709,800 | **0.03% increase** | [Condensed Consolidated Statement of Changes in Equity](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20CHANGES%20IN%20EQUITY%20(UNAUDITED)) For H1 2025, total equity slightly decreased due to comprehensive loss, while share capital and capital reserve remained unchanged Condensed Consolidated Statement of Changes in Equity | Indicator | June 30, 2025 (RMB thousands) | January 1, 2024 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Share Capital | 151,446 | 151,446 | **No change** | | Capital Reserve | 605,810 | 605,810 | **No change** | | Retained Earnings | 2,952,674 | 2,758,736 | **7.0% increase** | | Equity Attributable to Owners of the Company | 3,710,875 | 3,709,800 | **2.3% increase** | | Total Equity | 3,960,620 | 3,775,969 | **4.9% increase** | [Condensed Consolidated Statement of Cash Flows](index=9&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20CASH%20FLOWS%20(UNAUDITED)) For H1 2025, the company experienced net cash outflow from operating activities, significant net cash inflow from investing activities, and net cash outflow from financing activities, resulting in a net increase in cash and cash equivalents Condensed Consolidated Statement of Cash Flows | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Net Cash from Operating Activities | (100,772) | 155,028 | **Switched from inflow to outflow** | | Net Cash from Investing Activities | 243,380 | (189,609) | **Switched from outflow to inflow** | | Net Cash from Financing Activities | (107,980) | 54,126 | **Switched from inflow to outflow** | | Net Increase in Cash and Cash Equivalents | 34,628 | 19,545 | **77.2% increase** | | Cash and Cash Equivalents at End of Period | 183,040 | 176,155 | **3.9% increase** | [Notes to the Condensed Consolidated Financial Statements](index=10&type=section&id=Note) This section details key accounting policies, financial performance, and position disclosures within the interim condensed consolidated financial statements [Note 1: General Information](index=10&type=section&id=1.%20GENERAL%20INFORMATION) The company is a Sino-foreign equity joint stock limited company incorporated in China, with H shares listed on GEM, primarily engaged in investment holding, and its subsidiaries operate in tourism, wine production, metal trading, and LED device manufacturing - The company is a Sino-foreign equity joint stock limited company incorporated in China, with H shares listed on GEM [22](index=22&type=chunk) - The company's principal business is investment holding, with subsidiaries engaged in tourism and leisure, wine production and sales, metal product trading, and LED device manufacturing and sales [23](index=23&type=chunk) [Note 2: Basis of Preparation and Significant Accounting Policies](index=10&type=section&id=2.%20BASIS%20OF%20PREPARATION%20AND%20SIGNIFICANT%20ACCOUNTING%20POLICIES) The condensed consolidated financial statements are prepared in accordance with HKAS 34 and GEM Listing Rules; new and revised HKFRSs adopted this period did not cause significant changes to accounting policies or reported amounts, and the statements, though unaudited, have been reviewed by the audit committee - Financial statements are prepared in accordance with **HKAS 34** and the **GEM Listing Rules** [24](index=24&type=chunk) - New and revised HKFRSs adopted this period did not cause **significant changes** to accounting policies or reported amounts [25](index=25&type=chunk) - The condensed consolidated financial statements are unaudited but have been **reviewed by the Audit Committee** [29](index=29&type=chunk) [Note 3: Revenue](index=12&type=section&id=3.%20REVENUE) For H1 2025, total revenue was RMB 300,562 thousand, primarily from metal product trading and tourism development, with metal product trading contributing the largest share Revenue Breakdown (by major product or service line) | Product/Service Line | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Shuttle bus services | 68,680 | 56,187 | | Tourism and leisure services | 11,169 | 182 | | Wine and related products | 3,887 | 4,253 | | LED devices | 26,539 | 25,646 | | Metallic products | 190,238 | 128,573 | | Others | 49 | – | | **Total Revenue** | **300,562** | **214,841** | [Note 4: Other Gains, Income and Losses, Net](index=12&type=section&id=4.%20OTHER%20GAINS,%20INCOME%20AND%20LOSSES,%20NET) For H1 2025, net other gains, income and losses was a loss of RMB 1,817 thousand, a wider loss compared to RMB 371 thousand in the prior period, mainly due to other losses Other Gains, Income and Losses, Net | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Bank interest income | 456 | 556 | | Government grants | 25 | 247 | | Tax incentives | 199 | 1,788 | | Others | (2,497) | (2,962) | | **Total** | **(1,817)** | **(371)** | [Note 5: Segment Information](index=13&type=section&id=5.%20SEGMENT%20INFORMATION) The company has four reportable segments: tourism development, investment holding, trading of metallic products, and sales and production of LED devices; as of June 30, 2025, metal product trading generated the highest revenue, but investment holding and LED device segments recorded losses - The company has **four reportable segments**: tourism development, investment holding, trading of metallic products, and sales and production of LED devices [38](index=38&type=chunk)[41](index=41&type=chunk) Information on Operating Segment Profit or Loss (for the six months ended June 30, 2025) | Segment | Revenue from External Customers (RMB thousands) | Segment (Loss)/Profit (RMB thousands) | | :--- | :--- | :--- | | Tourism development | 79,849 | (1,652) | | Investment holding | – | (14,042) | | Trading of metallic products | 190,238 | 3,072 | | Sales and production of LED devices | 26,539 | (6,936) | | All other segments | 3,936 | (1,169) | | **Total** | **300,562** | **(20,727)** | Information on Operating Segment Assets (as of June 30, 2025) | Segment | Segment Assets (RMB thousands) | | :--- | :--- | | Tourism development | 923,126 | | Investment holding | 4,025,529 | | Trading of metallic products | 163,312 | | Sales and production of LED devices | 72,189 | | All other segments | 21,103 | | **Total Segment Assets** | **5,205,259** | - China (excluding Hong Kong) contributed the **vast majority of revenue and non-current assets** [50](index=50&type=chunk) - Customer A (metal product trading segment) contributed **RMB 190,238 thousand** to total revenue in the first half of 2025, making it a major customer [52](index=52&type=chunk) [Note 6: Finance Costs, Net](index=17&type=section&id=6.%20FINANCE%20COSTS,%20NET) For H1 2025, net finance costs were RMB 19,896 thousand, a decrease from the prior period, primarily comprising interest on bank and other borrowings and foreign exchange losses Finance Costs, Net | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest on bank, other borrowings and lease liabilities | 19,181 | 22,855 | | Net foreign exchange losses | 715 | 590 | | **Total** | **19,896** | **23,445** | [Note 7: Income Tax (Credit)/Expense](index=17&type=section&id=7.%20INCOME%20TAX%20(CREDIT)/EXPENSE) For H1 2025, the company recorded an income tax credit of RMB 21,644 thousand, mainly due to over-provision in prior years in China, contrasting with an income tax expense in the prior period Income Tax (Credit)/Expense | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Current tax – China | 1,118 | 2,696 | | Current tax – United States | 2 | 2 | | Over-provision in prior years – China | (22,217) | – | | Deferred tax | (547) | (571) | | **Total** | **(21,644)** | **2,127** | - The corporate income tax rate for Chinese subsidiaries is typically **25%** [57](index=57&type=chunk) [Note 8: Loss for the Period](index=18&type=section&id=8.%20LOSS%20FOR%20THE%20PERIOD) For H1 2025, the loss for the period was after deducting amortization of other intangible assets of RMB 6,766 thousand and depreciation of RMB 15,068 thousand Items Deducted from Loss for the Period | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Amortisation of other intangible assets | 6,766 | 6,796 | | Depreciation | 15,068 | 14,645 | [Note 9: Loss Per Share](index=18&type=section&id=9.%20LOSS%20PER%20SHARE) For H1 2025, basic and diluted loss per share was RMB 1.87 cents, a significant increase from RMB 0.40 cents in the prior period, mainly due to the increased loss attributable to owners of the company - Loss attributable to owners of the company was **RMB 28,372 thousand** (2024: RMB 6,049 thousand) [60](index=60&type=chunk) - Basic and diluted loss per share was **RMB 1.87 cents** (2024: RMB 0.40 cents) [13](index=13&type=chunk)[60](index=60&type=chunk) - The weighted average number of ordinary shares outstanding was **1,514,464,000 shares**, consistent with the prior period [60](index=60&type=chunk) [Note 10: Dividend](index=18&type=section&id=10.%20DIVIDEND) The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board of Directors does not recommend the payment of an interim dividend for the first half of 2025 (2024: nil) [61](index=61&type=chunk) [Note 11: Property, Plant and Equipment](index=18&type=section&id=11.%20PROPERTY,%20PLANT%20AND%20EQUIPMENT) During the period, the company made additions to property, plant and equipment of approximately RMB 5,898 thousand and disposed of property, plant and equipment with a net book value of approximately nil - Additions to property, plant and equipment amounted to approximately **RMB 5,898 thousand** during the period [62](index=62&type=chunk) - Disposal of property, plant and equipment with a net book value of approximately **nil** [62](index=62&type=chunk) [Note 12: Trade and Other Receivables](index=19&type=section&id=12.%20TRADE%20AND%20OTHER%20RECEIVABLES) As of June 30, 2025, total trade and other receivables were RMB 972,507 thousand, an increase from 2024 year-end, with other receivables constituting a larger proportion, and the company maintains strict control over overdue amounts Trade and Other Receivables | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade receivables and bills | 168,278 | 168,602 | | Loans and interest receivables | 14,170 | 1,057 | | Other receivables (net of allowance for doubtful debts) | 762,967 | 757,239 | | Prepayments | 38,003 | 2,077 | | **Total** | **972,507** | **938,976** | - Trade receivables aging analysis shows that amounts less than 3 months old account for the highest proportion, at **RMB 135,029 thousand** [72](index=72&type=chunk) - The company's credit period is generally **3 months**, and a credit control department is in place to mitigate credit risk [69](index=69&type=chunk) [Note 13: Trade and Other Payables](index=20&type=section&id=13.%20TRADE%20AND%20OTHER%20PAYABLES) As of June 30, 2025, total trade and other payables were RMB 315,823 thousand, a decrease from 2024 year-end, primarily due to a reduction in accrued expenses and other payables Trade and Other Payables | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade payables | 104,999 | 107,384 | | Contract liabilities | 2,024 | 1,236 | | Accrued expenses and other payables | 169,134 | 219,538 | | Dividends payable | 21,194 | 21,313 | | Salaries and staff welfare payable | 12,221 | 11,439 | | **Total** | **315,823** | **370,031** | - Trade payables aging analysis shows amounts from 0 to 90 days are **RMB 22,995 thousand**, and amounts over one year are **RMB 60,558 thousand** [77](index=77&type=chunk) [Note 14: Share Capital](index=21&type=section&id=14.%20SHARE%20CAPITAL) As of June 30, 2025, total registered, issued, and fully paid share capital was 1,514,464 thousand shares, comprising 700,000 thousand unlisted shares and 814,464 thousand H shares, each with a par value of RMB 0.10 Share Capital | Share Type | Number of Shares ('000) | Amount (RMB thousands) | | :--- | :--- | :--- | | Unlisted shares | 700,000 | 70,000 | | H shares | 814,464 | 81,446 | | **Total** | **1,514,464** | **151,446** | [Note 15: Material Related Party Transactions](index=22&type=section&id=15.%20MATERIAL%20RELATED%20PARTY%20TRANSACTIONS) The company has receivables and payables with related parties, and remuneration for key management personnel is disclosed Balances with Related Parties | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Amounts due from associates | 460 | 390 | | Amounts due from shareholders | 306 | 293 | | Amounts due to associates | 74 | 2,794 | | Amounts due to related companies controlled by Peking University | 5,732 | 5,882 | - Total remuneration for key management personnel was **RMB 1,983 thousand** (2024: RMB 2,378 thousand) [83](index=83&type=chunk) [Note 16: Financial Guarantee](index=23&type=section&id=16.%20FINANCIAL%20GUARANTEE) As of June 30, 2025, the company provided a financial guarantee of RMB 100 million for bank facilities granted to an associate, with directors deeming the likelihood of recourse claims to be low - The company provided a financial guarantee of **RMB 100 million** for bank facilities granted to an associate [84](index=84&type=chunk)[85](index=85&type=chunk) - Directors believe the likelihood of recourse claims under the guarantee is **low** [85](index=85&type=chunk) [Note 17: Capital Commitments](index=23&type=section&id=17.%20CAPITAL%20COMMITMENTS) As of June 30, 2025, the company's contracted but unprovided capital commitments primarily included property, plant and equipment and committed capital contributions to an associate Capital Commitments | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Property, plant and equipment | 98,192 | 69,270 | | Committed capital contributions to an associate | 3,478 | 3,478 | [Management Discussion and Analysis](index=24&type=section&id=MANAGEMENT%20DISCUSSION%20AND%20ANALYSIS) This section reviews the group's business performance and future strategies, analyzing its financial results, position, and key operational drivers [Business Review](index=24&type=section&id=BUSINESS%20REVIEW) The group's diversified businesses include tourism development, investment holding, LED device manufacturing, metal product trading, and wine; tourism benefited from good weather, investment holding involved share disposal and arbitration, LED business strengthened with new shareholders, metal trading volume increased, and vocational education expansion is planned [Tourism Development](index=24&type=section&id=Tourism%20development) Tourism operations in Hunan Nanyue District provide shuttle bus services, property management, and tourism facilities; in H1 2025, Hengshan scenic area visitor numbers increased by approximately 19% year-on-year, with revenue up 41.7%; the company plans to expand into Gansu Diebu County's Zaga Na scenic area with a joint venture for sightseeing rail and bus projects - In the first half of 2025, visitor and pilgrim numbers at Hengshan scenic area increased by approximately **19% year-on-year** [91](index=91&type=chunk)[94](index=94&type=chunk) - The company plans to collaborate with a third party to establish a joint venture in Zaga Na scenic area, Diebu County, Gansu, to develop and operate sightseeing rail and bus projects, expanding tourism investment and revenue sources [92](index=92&type=chunk)[95](index=95&type=chunk) [Investment Holding](index=25&type=section&id=Investment%20holding) Investment holding includes investments in private equity funds, semiconductor materials, display device companies, and Beining Fire Protection; the company disposed of 20 million Beining Fire Protection shares and is in arbitration with Mr. Cai regarding a share transfer agreement termination, with a final ruling expected in September - Investment holding business primarily includes investments in private equity funds, semiconductor materials and display device companies, and Beining Fire Protection [96](index=96&type=chunk)[98](index=98&type=chunk) - The company disposed of **20,000,000 Beining Fire Protection shares** under the disposal mandate, generating net proceeds of approximately **RMB 232.1 million**, used to repay bank borrowings [110](index=110&type=chunk)[112](index=112&type=chunk) - The company is in arbitration with Mr. Cai regarding the termination of the Beining Fire Protection share transfer agreement; a partial award requires Mr. Cai to return **70,044,000 Beining Fire Protection shares** and the company to return **RMB 220,369,200** of the consideration paid, with a final ruling expected in September 2025 [101](index=101&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk)[107](index=107&type=chunk) - As of the announcement date, the group holds **186,569,363 Beining Fire Protection shares**, representing approximately **21.4%** equity interest [113](index=113&type=chunk)[115](index=115&type=chunk) [Sales and Production of LED Devices](index=29&type=section&id=Sales%20and%20production%20of%20LED%20devices) The LED device business, primarily through non-wholly owned subsidiary Guangdong Liuming, focuses on R&D, production, and sales of high-end ceramic high-power LED devices and modules for special light sources; the company introduced new shareholders who injected RMB 50,630,000 into Guangdong Liuming to foster its growth and development - The LED device business focuses on R&D, production, and sales of **high-end ceramic high-power LED devices and modules**, including products for automotive lighting, mobile lighting, and color light series [114](index=114&type=chunk)[116](index=116&type=chunk) - The company introduced new shareholders who injected **RMB 50,630,000** into Guangdong Liuming; upon completion, the group's effective equity interest in Guangdong Liuming will decrease from 94% to approximately **62.98%**, but it will remain a non-wholly owned subsidiary [117](index=117&type=chunk)[121](index=121&type=chunk) [Trading of Metallic Products](index=30&type=section&id=Trading%20of%20metallic%20products) During the period, the group was engaged in the sale and procurement of metallic products in China - The group is engaged in the **sale and procurement of metallic products** in China [119](index=119&type=chunk)[122](index=122&type=chunk) [Other Businesses](index=30&type=section&id=Other%20businesses) Other businesses include operating a winery in Virginia, USA, and plans to acquire a 70% equity interest in Beijing Qingniao Vocational Education Technology Development Co., Ltd. to expand into vocational education - The group operates a winery in Virginia, USA, producing and selling wine and related products [120](index=120&type=chunk)[123](index=123&type=chunk) - The company plans to acquire a **70% equity interest** in Beijing Qingniao Vocational Education Technology Development Co., Ltd. for a consideration of **RMB 13,054,150** to diversify into the vocational education sector [124](index=124&type=chunk)[126](index=126&type=chunk) [Outlook](index=31&type=section&id=Outlook) Global economic growth is expected to be sluggish in H2 2025, posing challenges of weakened consumption and reduced demand; the group will maintain profitability through cost control, operational efficiency, and new client/product expansion, while prudently evaluating investment opportunities for portfolio diversification and capital appreciation - Global economic growth is expected to be **sluggish in the second half of 2025**, posing challenges of weakened local consumer spending and reduced demand for products and services [125](index=125&type=chunk)[127](index=127&type=chunk) - The group will implement measures including close monitoring and control of costs, enhancing operational efficiency, and expanding new clients and product portfolios to maintain profitability and competitive advantage [125](index=125&type=chunk)[127](index=127&type=chunk) - The group will continue to prudently explore and evaluate potential investment opportunities to achieve a balanced and diversified investment portfolio, supporting capital appreciation [128](index=128&type=chunk)[131](index=131&type=chunk)[172](index=172&type=chunk) [Financial Review](index=32&type=section&id=FINANCIAL%20REVIEW) This section analyzes the group's revenue and profit performance across business segments, the impact of non-recurring losses on overall results, and key financial indicators including financial position, liquidity, capital structure, significant investments, contingent liabilities, foreign exchange risk, and staff costs [Tourism Development (Financial)](index=32&type=section&id=Tourism%20development_financial) Tourism revenue increased by 41.7% to RMB 79.8 million, benefiting from favorable weather in H1 2025; however, the group recorded a loss of approximately RMB 24.0 million due to a cashier's alleged misappropriation of approximately RMB 25.1 million, prompting a forensic investigation and internal control review - Tourism development business revenue was approximately **RMB 79.8 million**, an increase of **41.7%** year-on-year [129](index=129&type=chunk)[132](index=132&type=chunk) - A cashier allegedly misappropriated approximately **RMB 25.1 million**, resulting in a loss of approximately **RMB 24.0 million** for the group [130](index=130&type=chunk)[133](index=133&type=chunk)[155](index=155&type=chunk)[159](index=159&type=chunk) - The company has engaged external professionals to conduct a forensic investigation and review of internal control systems to prevent similar incidents [134](index=134&type=chunk)[138](index=138&type=chunk) [Investment Holding (Financial)](index=33&type=section&id=Investment%20holding_financial) Investment holding segment's total assets decreased by 5.7% to RMB 4,025.5 million, mainly due to the disposal of 20,000,000 Beining Fire Protection shares; the group recorded a loss of approximately RMB 22.1 million from partial disposal of an associate - Investment holding business segment's total assets decreased by **5.7%** to approximately **RMB 4,025.5 million** [135](index=135&type=chunk)[139](index=139&type=chunk) - The group recorded a loss of approximately **RMB 22.1 million** due to the partial disposal of associate Beining Fire Protection [135](index=135&type=chunk)[139](index=139&type=chunk)[145](index=145&type=chunk)[150](index=150&type=chunk)[155](index=155&type=chunk)[159](index=159&type=chunk) [Sales and Production of LED Devices (Financial)](index=33&type=section&id=Sales%20and%20production%20of%20LED%20devices_financial) LED device business revenue was approximately RMB 26.5 million, representing a 3.5% year-on-year increase - LED device business revenue was approximately **RMB 26.5 million**, an increase of **3.5%** year-on-year [136](index=136&type=chunk)[140](index=140&type=chunk) [Trading of Metallic Products (Financial)](index=33&type=section&id=Trading%20of%20metallic%20products_financial) Metallic product trading revenue was approximately RMB 190.2 million, a 48.0% year-on-year increase, primarily due to increased trading volume; gross profit margin decreased to 1.5%, affected by market competition and price fluctuations - Metallic product trading business revenue was approximately **RMB 190.2 million**, an increase of **48.0%** year-on-year [137](index=137&type=chunk)[141](index=141&type=chunk) - Gross profit margin was **1.5%** (2024: 2.1%), with the decrease attributed to intense market competition and price fluctuations of metallic products [137](index=137&type=chunk)[141](index=141&type=chunk) [Other Businesses (Financial)](index=34&type=section&id=Other%20businesses_financial) Winery business revenue was approximately RMB 3.9 million, remaining largely stable year-on-year - Winery business revenue was approximately **RMB 3.9 million**, largely stable year-on-year [142](index=142&type=chunk)[147](index=147&type=chunk) [Revenue and Gross Profit](index=34&type=section&id=Revenue%20and%20gross%20profit) Total group revenue was approximately RMB 300.6 million, a 39.9% year-on-year increase; gross profit was approximately RMB 47.7 million, a 49.9% year-on-year increase, primarily driven by improved tourism business and increased metallic product trading volume - Total revenue was approximately **RMB 300.6 million**, an increase of **39.9%** year-on-year [143](index=143&type=chunk)[148](index=148&type=chunk) - Gross profit was approximately **RMB 47.7 million**, an increase of **49.9%** year-on-year [143](index=143&type=chunk)[148](index=148&type=chunk) - Revenue and gross profit growth were primarily due to improved tourism business and increased metallic product trading volume [143](index=143&type=chunk)[148](index=148&type=chunk) [Loss on Disposal of Joint Ventures](index=34&type=section&id=Loss%20on%20disposal%20of%20joint%20ventures) The group recorded a loss of approximately RMB 16.1 million from the dissolution of an immaterial joint venture, primarily reflecting the reclassification of negative exchange reserves - A loss of approximately **RMB 16.1 million** was recorded from the dissolution of an immaterial joint venture [144](index=144&type=chunk)[149](index=149&type=chunk)[155](index=155&type=chunk)[159](index=159&type=chunk) - The loss primarily reflects the reclassification of negative exchange reserves of approximately **RMB 16.1 million** to profit or loss [144](index=144&type=chunk)[149](index=149&type=chunk) [Loss on Partial Disposal of an Associate](index=34&type=section&id=Loss%20on%20partial%20disposal%20of%20an%20associate) The group recorded a loss of approximately RMB 22.1 million from the partial disposal of associate Beining Fire Protection under the disposal mandate - A loss of approximately **RMB 22.1 million** was recorded from the partial disposal of associate Beining Fire Protection [145](index=145&type=chunk)[150](index=150&type=chunk)[155](index=155&type=chunk)[159](index=159&type=chunk) [Finance Costs, Net](index=34&type=section&id=Finance%20costs,%20net) Net finance costs were approximately RMB 19.9 million, a decrease from RMB 23.4 million in the prior period, primarily comprising interest on bank and other borrowings, lease liabilities, and net foreign exchange losses - Net finance costs were approximately **RMB 19.9 million** (2024: RMB 23.4 million) [146](index=146&type=chunk)[151](index=151&type=chunk) - Primarily includes interest on bank and other borrowings, interest on lease liabilities, and net foreign exchange losses [146](index=146&type=chunk)[151](index=151&type=chunk) [Share of Profit of Associates](index=35&type=section&id=Share%20of%20profit%20of%20associates) The group's share of profit of associates was approximately RMB 30.2 million, a 32.3% year-on-year increase, mainly due to the associates' weaker financial performance in the prior period - Share of profit of associates was approximately **RMB 30.2 million**, an increase of **32.3%** year-on-year [152](index=152&type=chunk)[156](index=156&type=chunk) - The increase was mainly due to the relatively unfavorable financial performance of associates in the prior period of 2024 [152](index=152&type=chunk)[156](index=156&type=chunk) [Share of Loss of Joint Ventures](index=35&type=section&id=Share%20of%20loss%20of%20joint%20ventures) The group's share of loss of joint ventures was approximately RMB 1.0 million, an increase from RMB 54 thousand in the prior period - Share of loss of joint ventures was approximately **RMB 1.0 million** (2024: RMB 54 thousand) [153](index=153&type=chunk)[157](index=157&type=chunk) [Income Tax Credit/Expense](index=35&type=section&id=Income%20tax%20credit/expense) The group recorded an income tax credit of approximately RMB 21.6 million, primarily comprising net China corporate income tax credit and deferred tax credit - Income tax credit was approximately **RMB 21.6 million** (2024: expense of RMB 2.2 million) [154](index=154&type=chunk)[158](index=158&type=chunk) - Primarily includes net China corporate income tax credit of approximately **RMB 21.1 million** and deferred tax credit of approximately **RMB 0.5 million** [154](index=154&type=chunk)[158](index=158&type=chunk) [Loss Attributable to the Owners of the Company](index=35&type=section&id=Loss%20attributable%20to%20the%20owners%20of%20the%20Company) Loss attributable to owners of the company was approximately RMB 28.4 million, a 369.0% year-on-year increase, primarily due to several non-recurring losses including the alleged misappropriation incident, partial disposal of an associate, and dissolution of a joint venture - Loss attributable to owners of the company was approximately **RMB 28.4 million**, an increase of **369.0%** year-on-year [155](index=155&type=chunk)[159](index=159&type=chunk) - The increased loss was primarily due to non-recurring losses including the alleged misappropriation incident (**RMB 24.0 million**), partial disposal of associate Beining Fire Protection (**RMB 22.1 million**), and dissolution of an immaterial joint venture (**RMB 16.1 million**) [155](index=155&type=chunk)[159](index=159&type=chunk) [Financial Position](index=36&type=section&id=Financial%20position) As of June 30, 2025, the group's current ratio was 1.35 (December 31, 2024: 1.06) and gearing ratio was 22.8% (December 31, 2024: 25.0%); the increase in current ratio and decrease in gearing ratio were mainly due to reduced bank and other borrowings - Current ratio was **1.35** (December 31, 2024: 1.06) [160](index=160&type=chunk)[164](index=164&type=chunk) - Gearing ratio was **22.8%** (December 31, 2024: 25.0%) [160](index=160&type=chunk)[164](index=164&type=chunk)[167](index=167&type=chunk)[170](index=170&type=chunk) - The increase in current ratio and decrease in gearing ratio were primarily due to a **reduction in bank and other borrowings** [160](index=160&type=chunk)[164](index=164&type=chunk) [Material Acquisitions and Disposals of Subsidiaries and Affiliated Companies](index=36&type=section&id=Material%20acquisitions%20and%20disposals%20of%20subsidiaries%20and%20affiliated%20companies) For H1 2025, the group did not undertake any other material acquisitions and disposals requiring disclosure, apart from those already disclosed - Apart from disclosed matters, there were **no other material acquisitions and disposals** during the period [161](index=161&type=chunk)[165](index=165&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=36&type=section&id=Liquidity,%20financial%20resources%20and%20capital%20structure) The group primarily finances operations through internal financial resources and corporate borrowings; as of June 30, 2025, cash and cash equivalents were approximately RMB 183.0 million, with total outstanding borrowings of approximately RMB 901.4 million, mostly denominated in RMB and bearing fixed or floating interest rates - Primary sources of working capital are **internal financial resources and corporate borrowings** [162](index=162&type=chunk)[166](index=166&type=chunk) - As of June 30, 2025, cash and cash equivalents were approximately **RMB 183.0 million** [162](index=162&type=chunk)[166](index=166&type=chunk) - Total outstanding borrowings were approximately **RMB 901.4 million**, including secured/unsecured, mortgaged/unmortgaged bank and other borrowings [163](index=163&type=chunk)[166](index=166&type=chunk) - Borrowings are primarily denominated in RMB, with annual interest rates ranging from **zero to 5.4%** [163](index=163&type=chunk)[166](index=166&type=chunk) [Significant Investments Held](index=37&type=section&id=Significant%20investments%20held) As of June 30, 2025, the group held financial assets at fair value through other comprehensive income and fair value through profit or loss totaling approximately RMB 758.7 million, representing 14.2% of total assets, primarily including a 13.7% equity interest in Shanghai Xianyao Display Technology Co., Ltd.; the investment strategy aims to diversify assets and businesses to mitigate risks, seize market opportunities, and broaden revenue streams - Held financial assets at fair value through other comprehensive income and fair value through profit or loss totaling approximately **RMB 758.7 million**, representing **14.2% of total assets** [168](index=168&type=chunk)[171](index=171&type=chunk) - Primarily includes a **13.7% equity interest** in Shanghai Xianyao Display Technology Co., Ltd., with a fair value of approximately **RMB 712.8 million** [168](index=168&type=chunk)[171](index=171&type=chunk) - The investment strategy is to diversify assets and businesses, focusing on tourism and leisure, new materials, semiconductor products, and high-tech enterprises to enhance competitive position and broaden revenue sources [169](index=169&type=chunk)[172](index=172&type=chunk) [Future Plans for Material Investments or Capital Assets](index=38&type=section&id=Future%20plans%20for%20material%20investments%20or%20capital%20assets) As of June 30, 2025, the group had no other material investment plans apart from those already disclosed - As of June 30, 2025, the group had **no other material investment plans** apart from those already disclosed [173](index=173&type=chunk)[177](index=177&type=chunk) [Contingent Liabilities](index=38&type=section&id=Contingent%20liabilities) As of June 30, 2025, the group had contingent liabilities of approximately RMB 100 million for bank facilities granted to an associate - The group had contingent liabilities of approximately **RMB 100 million** for bank facilities granted to an associate [174](index=174&type=chunk)[178](index=178&type=chunk) [Foreign Exchange Exposure](index=38&type=section&id=Foreign%20exchange%20exposure) The group faces some foreign currency risk, but it is limited as most business activities, assets, and liabilities are denominated in USD, RMB, and HKD, with automatic matching of turnover and production costs; the group will continue to monitor and mitigate foreign currency risk - The group faces some foreign currency risk, primarily involving **USD, RMB, and HKD** [175](index=175&type=chunk)[179](index=179&type=chunk) - Currency risk is **limited** due to automatic matching of turnover and production costs [175](index=175&type=chunk)[179](index=179&type=chunk) - The group will continue to **monitor and take measures to mitigate foreign currency risk** [175](index=175&type=chunk)[179](index=179&type=chunk) [Charge on Assets](index=38&type=section&id=Charge%20on%20assets) As of June 30, 2025, certain fixed assets, investment properties, and an equity interest in an associate were pledged as collateral for bank and other borrowings - As of June 30, 2025, fixed assets with a carrying value of approximately **RMB 197.7 million**, investment properties of approximately **RMB 333.6 million**, and an equity interest in an associate were pledged as collateral for bank and other borrowings [176](index=176&type=chunk)[180](index=180&type=chunk) [Employees and Remuneration Policy](index=39&type=section&id=Employees%20and%20remuneration%20policy) As of the reporting period end, the group had 740 employees, a 23.3% year-on-year increase; the group adheres to labor laws, provides competitive compensation and benefits, prioritizes workplace safety, and total staff costs of approximately RMB 38.3 million are consistent with employee expansion - As of the end of the reporting period, the group had a total of **740 employees**, an increase of **23.3%** year-on-year [181](index=181&type=chunk)[185](index=185&type=chunk) - The group provides **competitive compensation and benefits**, including medical and travel insurance, and makes timely contributions to retirement and MPF schemes [181](index=181&type=chunk)[185](index=185&type=chunk) - Total staff costs were approximately **RMB 38.3 million** (2024: RMB 32.9 million), consistent with the expansion in employee numbers [183](index=183&type=chunk)[186](index=186&type=chunk) [Other Information](index=39&type=section&id=Other%20Information) This section discloses interests and short positions of directors, supervisors, chief executives, and substantial shareholders in the company's shares and underlying shares, confirms no rights to acquire shares for directors/supervisors, no competing interests, compliance with corporate governance practices, no purchase/redemption/sale of listed securities during the period, and directors' adherence to the securities dealing code; the audit committee has reviewed this interim report [Directors', Supervisors' and Chief Executives' Interests and Short Positions in Shares and Underlying Shares](index=39&type=section&id=DIRECTORS',%20SUPERVISORS'%20AND%20CHIEF%20EXECUTIVES'%20INTERESTS%20AND%20SHORT%20POSITIONS%20IN%20SHARES%20AND%20UNDERLYING%20SHARES) As of June 30, 2025, Supervisor Ms. Zhou Min held 205,414,000 unlisted shares as a trust beneficiary, representing 13.56% of total share capital; Executive Director Mr. Liu Ziyi beneficially owned 3,000,000 H shares, representing 0.20% of total share capital Long Positions in Ordinary Shares and Underlying Shares of the Company | Name | Capacity | Interest in Unlisted Shares | Interest in H Shares | Approximate Percentage of Total Issued Shares of the Company | | :--- | :--- | :--- | :--- | :--- | | Ms. Zhou Min (Supervisor) | Beneficiary of a trust | 205,414,000 | – | 13.56% | | Mr. Liu Ziyi (Executive Director) | Beneficial owner | – | 3,000,000 | 0.20% | [Directors' and Supervisors' Rights to Acquire Shares](index=41&type=section&id=DIRECTORS'%20AND%20SUPERVISORS'%20RIGHTS%20TO%20ACQUIRE%20SHARES) During the period, no directors, supervisors, or their spouses/minor children were granted or exercised any rights to acquire company shares, nor did the company arrange for them to obtain such rights in other corporate entities - During the period, no directors, supervisors, or their spouses or minor children were granted or exercised any rights to acquire shares of the company [193](index=193&type=chunk)[195](index=195&type=chunk) - Neither the company, its holding company, nor any of its subsidiaries or fellow subsidiaries arranged for directors and supervisors to acquire such rights in other corporate entities [193](index=193&type=chunk)[195](index=195&type=chunk) [Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares and Underlying Shares](index=41&type=section&id=SUBSTANTIAL%20SHAREHOLDERS'%20AND%20OTHER%20PERSONS'%20INTERESTS%20AND%20SHORT%20POSITIONS%20IN%20SHARES%20AND%20UNDERLYING%20SHARES) As of June 30, 2025, substantial shareholders and their controlled corporations, including Peking University, Cai Yiwen, Zhai Yong, Heng Huat Investments Limited, Mongolia Energy Limited, and Huang Taomei, held significant interests in the company's issued share capital Long Positions in Shares and Underlying Shares of Substantial Shareholders and Other Persons | Shareholder Name | Capacity | Interest in Unlisted Shares | Interest in H Shares | Approximate Percentage of Total Issued Shares of the Company | | :--- | :--- | :--- | :--- | :--- | | Peking University | Interest of controlled corporation | 85,000,000 | – | 5.61% | | Cai Yiwen | Interest of controlled corporation | 115,000,000 | – | 7.59% | | Zhai Yong | Interest of controlled corporation | 130,000,000 | – | 8.58% | | Heng Huat Investments Limited | Interest of controlled corporation | 205,414,000 | – | 13.56% | | Mongolia Energy Limited | Interest of controlled corporation | 84,586,000 | – | 5.58% | | Huang Taomei | Interest of controlled corporation | – | 126,214,000 | 8.33% | [Competing Interests](index=44&type=section&id=COMPETING%20INTERESTS) As of June 30, 2025, no directors, supervisors, or their associates held interests in businesses that compete or may compete with the group's business, nor were there any conflicts of interest - No directors, supervisors, or their associates held interests in businesses that compete or may compete with the group's business [203](index=203&type=chunk)[207](index=207&type=chunk) - There were **no conflicts of interest** [203](index=203&type=chunk)[207](index=207&type=chunk) [Corporate Governance Practices](index=44&type=section&id=CORPORATE%20GOVERNANCE%20PRACTICES) The Board believes the company has complied with all code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the GEM Listing Rules for the six months ended June 30, 2025 - The company has complied with **all code provisions** of the Corporate Governance Code set out in Appendix C1 Part 2 of the GEM Listing Rules [204](index=204&type=chunk)[208](index=208&type=chunk) [Purchase, Redemption or Sale of the Company's Listed Securities](index=44&type=section&id=PURCHASE,%20REDEMPTION%20OR%20SALE%20OF%20THE%20LISTED%20SECURITIES%20OF%20THE%20COMPANY) For H1 2025, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities - During the period, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities [205](index=205&type=chunk)[209](index=209&type=chunk) [Code of Conduct Regarding Securities Transactions by Directors](index=45&type=section&id=CODE%20OF%20CONDUCT%20REGARDING%20SECURITIES%20TRANSACTIONS%20BY%20DIRECTORS) The company has adopted a code of conduct for directors' securities transactions, and all directors complied with this code and the required standards of dealing for the six months ended June 30, 2025 - The company has adopted a code of conduct for directors' securities transactions that is **no less exacting** than required by the GEM Listing Rules [210](index=210&type=chunk)[215](index=215&type=chunk) - All directors complied with the code of conduct and the required standards of dealing during the period [210](index=210&type=chunk)[215](index=215&type=chunk) [Audit Committee](index=45&type=section&id=AUDIT%20COMMITTEE) The Audit Committee, comprising three independent non-executive directors and chaired by Mr. Tang Xuan, convened to review and approve the group's interim report for the six months ended June 30, 2025 - The Audit Committee comprises **three independent non-executive directors**, with Mr. Tang Xuan as Chairman [212](index=212&type=chunk)[216](index=216&type=chunk) - The committee has reviewed and approved the content of the group's interim report for the six months ended June 30, 2025 [212](index=212&type=chunk)[216](index=216&type=chunk)

[Definitions](index=2&type=section&id=%E9%87%8B%E7%BE%A9) This section provides definitions of key terms used throughout the report [Company Information](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section presents essential corporate details and contact information [Key Financial Highlights](index=7&type=section&id=%E4%B8%BB%E8%A6%81%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) For the six months ended June 30, 2025, revenue decreased by 13.3% to RMB 1,270.6 million, profit for the period significantly declined by 72.4% to RMB 28.6 million, and basic and diluted earnings per share both fell to RMB 0.04 Key Financial Highlights for the Six Months Ended June 30, 2025 | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 1,270,559 | 1,465,701 | -13.3% | | Gross Profit | 454,472 | 559,733 | -18.8% | | Profit for the Period | 28,569 | 103,478 | -72.4% | | Profit Attributable to Owners of the Parent | 27,273 | 101,582 | -73.2% | | Basic Earnings Per Share (RMB) | 0.04 | 0.14 | -71.4% | | Diluted Earnings Per Share (RMB) | 0.04 | 0.14 | -71.4% | [Management Discussion and Analysis](index=8&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) The company faced industry headwinds in H1 2025, leading to revenue and profit decline, yet co-construction and CRO businesses grew, while digital transformation, AI applications, and strategic acquisitions continue to expand its market presence and enhance competitiveness [Business Review](index=8&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) As a leading ICL service provider in China, the company reported a 13.3% revenue decline in H1, but co-construction and CRO businesses grew by 30% and 18% respectively, driven by digital transformation, AI applications, and strategic acquisitions - The company is a leading ICL service provider in China, operating **34 self-owned laboratories** and offering over **4,000 medical diagnostic tests**, with **24 laboratories accredited with ISO15189**[14](index=14&type=chunk) - In May 2025, the Group acquired Yuande Youqin and its IVD subsidiary, Yuande Weikang, a Chinese hematology diagnostics company, to enhance its competitive edge in online hematology[15](index=15&type=chunk) H1 2025 Business Performance | Business Segment | YoY Revenue Change | | :--- | :--- | | Total Revenue | Declined by 13.3% | | Co-construction Business | Grew by 30% (four-year CAGR of 48%) | | CRO Business | Grew by 18% | | Specialty Testing Business | Declined by 6% (Oncology product line grew over 9%) | - Regarding IT, the new generation LIMS system has been implemented in **32 companies**, with full deployment planned for H2, and master data construction will be completed to solidify the foundation for digital transformation[18](index=18&type=chunk) - In AI applications, AI-assisted pathology reading technology is maturely applied in cervical cancer and reproductive genetics, **improving reading speed by 6-7 times**; the generative AI medical examination intelligent assistant 'Aixiaoyi' has officially launched, offering test item recommendations and intelligent consultations; new AI pathology report quality control system and flow cytometry AI analysis platform were introduced[18](index=18&type=chunk) - The company's strategic outlook focuses on deepening general testing, high-speed growth in specialty testing, expanding CRO business, upgrading co-construction business, and leveraging M&A for quality resource integration[20](index=20&type=chunk) - In operational excellence, H1 2025 reagent procurement costs **decreased by approximately 13%** YoY, logistics unit costs **reduced by about 4%**, and laboratory efficiency **improved by 11%**[21](index=21&type=chunk) [Industry Overview](index=11&type=section&id=%E8%A1%8C%E6%A5%AD%E6%A6%82%E8%A7%88) Government policies, an aging population, precision medicine, and AI technology are driving growth and transformation in China's ICL market, while healthcare price reforms and anti-monopoly actions are expected to foster a more compliant and sustainable competitive environment - Government policies encourage private medical institutions, support public-private sharing of medical imaging and clinical testing services, and relax planning restrictions for private healthcare, fostering ICL development[23](index=23&type=chunk) - The 14th Five-Year Plan and revisions to the Medical Device Supervision and Administration Regulations support bio-economic development and in-house clinical laboratory projects, benefiting the ICL market[24](index=24&type=chunk) - Unmet demands in China's healthcare market, including hierarchical diagnosis and treatment, growth in lower-tier city hospitals, optimized hospital revenue structures, and medical insurance reforms, all contribute to ICL business growth[25](index=25&type=chunk)[26](index=26&type=chunk) - Aging population, increased health awareness, precision medicine development, and new technology applications (e.g., PCR, NGS, mass spectrometry, flow cytometry) continuously drive testing volume growth[27](index=27&type=chunk)[35](index=35&type=chunk) - ICLs offer broader network coverage, economies of scale, extensive testing scope, rapid technology adoption, and talent advantages compared to hospital laboratories[28](index=28&type=chunk) - Multi-level market synergistic development sees ICLs collaborating with top-tier hospitals and serving grassroots medical institutions, promoting balanced distribution of medical resources[31](index=31&type=chunk) - Stricter policy regulation, such as anti-corruption in pharmaceutical procurement and specialized measures for outsourced diagnostic testing, will create a fair competitive environment for compliant ICL leaders[32](index=32&type=chunk) - DRG/DIP 2.0 reforms emphasize cost control, benefiting low-cost diagnostic testing service providers like ICLs, and improving ICL cash flow through measures such as advance medical insurance payments[33](index=33&type=chunk) - Big data and AI technologies are reshaping the clinical testing industry, enhancing diagnostic accuracy, laboratory quality control, and operational efficiency, with ICLs serving as key hubs for AI implementation[37](index=37&type=chunk) - Healthcare service price reforms impact hospital operating profits, potentially leading hospitals to increase outsourced testing services and creating new opportunities for ICL companies[38](index=38&type=chunk)[39](index=39&type=chunk) - China's anti-excessive competition initiatives are expected to reduce vicious price competition, fostering a healthier and more sustainable competitive environment for the ICL industry[40](index=40&type=chunk) [Financial Review](index=16&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) For the six months ended June 30, 2025, revenue decreased by 13.3% due to industry headwinds, gross margin fell to 35.8%, and profit for the period significantly declined by 72.4%, while trade receivables days increased and cash equivalents decreased, with capital expenditure slightly up and financial ratios stable [Selected Items from Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=16&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8%E7%9A%84%E9%81%B8%E5%AE%9A%E9%A0%85%E7%9B%AE) For the six months ended June 30, 2025, revenue decreased by 13.3% to RMB 1,270.6 million due to price-demand imbalance, gross margin fell to 35.8%, administrative expenses increased by 4.7% due to IT investment, and profit for the period significantly declined by 72.4% to RMB 28.6 million Key Income Statement Metrics Comparison (Six Months Ended June 30) | Metric | 2025 (RMB million) | 2024 (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 1,270.6 | 1,465.7 | -13.3% | | Cost of Sales | 816.1 | 906.0 | -9.9% | | Gross Profit | 454.5 | 559.7 | -18.8% | | Gross Margin | 35.8% | 38.2% | -2.4 percentage points | | Selling and Marketing Expenses | 196.4 | 202.0 | -2.8% | | Administrative Expenses | 112.6 | 107.5 | +4.7% | | Research and Development Expenses | 54.9 | 58.7 | -6.5% | | Other Expenses | 35.7 | 50.0 | -28.6% | | Other Income and Gains | 12.7 | 19.7 | -35.6% | | Finance Costs | 22.0 | 27.4 | -19.8% | | Income Tax Expense | 16.9 | 30.3 | -44.1% | | Profit for the Period | 28.6 | 103.5 | -72.4% | - Revenue decrease was primarily due to industry headwinds from price-demand imbalance, though co-construction and CRO businesses maintained strong growth[41](index=41&type=chunk) - Cost of sales decreased mainly due to proactive reduction in reagent procurement costs and improved operational efficiency[42](index=42&type=chunk) - Gross margin decline was primarily due to reduced operating leverage from lower revenue, partially mitigated by cost reduction measures[43](index=43&type=chunk) - Administrative expenses increased mainly due to investments in information technology, including AI and cloud infrastructure[47](index=47&type=chunk) - Other expenses decreased primarily due to reduced provision for expected credit losses related to receivables and lower inventory impairment losses[49](index=49&type=chunk) [Selected Items from Unaudited Condensed Consolidated Statement of Financial Position](index=18&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8%E7%9A%84%E9%81%B8%E5%AE%9A%E9%A0%85%E7%9B%AE) As of June 30, 2025, total current assets decreased to RMB 2,931.0 million, and total current liabilities decreased to RMB 1,870.2 million, with inventory down 8.7% and turnover days shortened to 27, while trade and bills receivables increased by 12.2% to RMB 1,545.0 million, with turnover days extending to 262 due to client budget pressures, and trade payables decreased by 5.6% with turnover days increasing to 156 Key Balance Sheet Metrics Comparison (As of June 30) | Metric | 2025 (RMB million) | 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Total Current Assets | 2,931.0 | 3,050.7 | -3.9% | | Total Current Liabilities | 1,870.2 | 1,925.1 | -2.8% | | Inventories | 115.9 | 126.9 | -8.7% | | Trade and Bills Receivables | 1,545.0 | 1,377.4 | +12.2% | | Trade and Bills Payables | 681.4 | 721.8 | -5.6% | | Other Payables and Accrued Charges | 515.7 | 613.4 | -15.9% | | Contract Liabilities | 21.9 | 29.9 | -26.7% | | Pledged Deposits | 956.0 | 956.0 | 0% | - Inventory turnover days decreased from **31 days in 2024** to **27 days in H1 2025**, primarily due to continuous optimization of inventory management[55](index=55&type=chunk) - Total trade and bills receivables turnover days increased from **220 days in 2024** to **262 days in H1 2025**, mainly due to a general increase in client budget pressures within the industry[56](index=56&type=chunk) - Trade and bills payables turnover days increased from **148 days in 2024** to **156 days in H1 2025**, primarily attributable to negotiating more favorable payment terms with suppliers[58](index=58&type=chunk) - Other payables and accrued charges decreased mainly due to a change in the year-end bonus payment cycle, resulting in a **RMB 71.9 million** reduction in salaries payable[60](index=60&type=chunk) [Liquidity and Capital Resources](index=19&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B3%87%E6%BA%90) As of June 30, 2025, cash and cash equivalents decreased by 28.0% to RMB 751.1 million, primarily due to seasonal client repayment cycles, and net cash position decreased by 45.3% to RMB 379.9 million, with no significant fundraising plans but continuous market monitoring for future growth Key Liquidity and Capital Resources Metrics Comparison (As of June 30) | Metric | 2025 (RMB million) | 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 751.1 | 1,043.8 | -28.0% | | Net Cash Position | 379.9 | 693.9 | -45.3% | - Cash and cash equivalents decreased primarily due to negative net operating cash flow resulting from seasonal client repayment cycles[63](index=63&type=chunk) - For the six months ended June 30, 2025, the effective annual interest rate for interest-bearing bank borrowings ranged from **1.9% to 3.5%**[64](index=64&type=chunk) - As of June 30, 2025, the company was not involved in any significant legal, arbitration, or administrative proceedings expected to have a material adverse effect on its financial position or operating results[65](index=65&type=chunk) [Capital Expenditure](index=20&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF) For the six months ended June 30, 2025, capital expenditure increased by 6.6% YoY to RMB 57.2 million, primarily driven by increased purchases of property, equipment, and other intangible assets due to the continuous expansion of co-construction business, with capital commitments slightly rising to RMB 9.6 million Capital Expenditure and Commitments Comparison (As of June 30) | Metric | 2025 (RMB million) | 2024 (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Capital Expenditure | 57.2 | 53.7 | +6.6% | | Capital Commitments | 9.6 | 9.3 | +3.0% | - Capital expenditure increased primarily due to the 2025 H1 continuous expansion of co-construction business, leading to increased purchases of property and equipment, and other intangible assets[66](index=66&type=chunk) [Financial Ratios](index=20&type=section&id=%E8%B2%A1%E5%8B%99%E6%AF%94%E7%8E%87) As of June 30, 2025, the company's current ratio was 1.57, quick ratio was 1.51, and debt-to-asset ratio was 0.75, remaining stable compared to the end of 2024 Financial Ratios Comparison (As of June 30) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current Ratio | 1.57 | 1.58 | | Quick Ratio | 1.51 | 1.52 | | Debt-to-Asset Ratio | 0.75 | 0.74 | - As of June 30, 2025, the Group had no pledged assets[68](index=68&type=chunk) [Other Financial and Operating Information](index=21&type=section&id=%E5%85%B6%E4%BB%96%E8%B2%A1%E5%8B%99%E5%8F%8A%E7%87%9F%E9%81%8B%E4%BF%A1%E6%81%AF) As of the interim report date, the company has no significant investment plans, conducts most transactions in RMB without foreign currency hedging, and reported no major acquisitions, investments, or disposals in H1, with 5,151 employees and total staff costs of RMB 404.2 million as of June 30, 2025 - As of the date of this interim report, the Group had no specific committed plans for significant investments and capital assets in 2025[71](index=71&type=chunk) - The company primarily operates in China, with most transactions denominated and settled in RMB, and currently has no foreign currency hedging policy[72](index=72&type=chunk) - For the six months ended June 30, 2025, the company did not undertake any significant acquisitions, investments, or disposals of subsidiaries, associates, or joint ventures[73](index=73&type=chunk) Employee and Remuneration Information (Six Months Ended June 30) | Metric | 2025 | | :--- | :--- | | Total Number of Employees | 5,151 | | Total Staff Costs | RMB 404.2 million | [Corporate Governance and Other Information](index=22&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%8F%8A%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) This section details directors' and substantial shareholders' equity interests, employee incentive schemes, compliance with corporate governance codes, share repurchases, audit committee review of interim financial statements, full utilization of global offering proceeds, absence of post-reporting period events, and the board's recommendation against an interim dividend [Interests of Directors and Chief Executive](index=22&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E6%9C%80%E9%AB%98%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E6%AC%8A%E7%9B%8A) As of June 30, 2025, Executive Director Mr. Gao Song held approximately 1.59% of the company's share interests, including controlled corporation interests and restricted share units and share options under incentive schemes, while Non-executive Director Mr. Lin Jixun held approximately 12.38% of the share interests Directors' and Chief Executive's Share Interests (As of June 30, 2025) | Name | Nature of Interest | Number of Shares (L) | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | Mr. Gao Song | Interest in controlled corporation | 303,750 | 0.04% | | | Beneficial owner (incentive scheme) | 11,249,646 | 1.55% | | Mr. Lin Jixun | Interest in controlled corporation | 90,061,994 | 12.38% | [Interests of Substantial Shareholders](index=23&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%AC%8A%E7%9B%8A) As of June 30, 2025, Pearl Group Limited was the largest shareholder with 38.71% of shares, Mr. Lin Jixun and his wholly-owned Corelink held 12.38%, and Mr. Lin Feng and his wholly-owned Mega Stream Limited held 9.90% Substantial Shareholders' Share Interests (As of June 30, 2025) | Name | Nature of Interest | Number of Shares (L) | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | Pearl Group Limited | Beneficial owner | 281,541,805 | 38.71% | | Mr. Lin Jixun | Interest in controlled corporation | 90,061,994 | 12.38% | | Corelink | Beneficial owner | 90,061,994 | 12.38% | | Mr. Lin Feng | Interest in controlled corporation | 72,005,994 | 9.90% | | Mega Stream Limited | Beneficial owner | 72,005,994 | 9.90% | - Pearl Group Limited is owned by Carlyle Asia Partners V, L.P. and CAP V Co-Investment, L.P., ultimately controlled indirectly by The Carlyle Group[81](index=81&type=chunk) [Employee Incentive Schemes](index=24&type=section&id=%E5%83%B1%E5%93%A1%E6%BF%80%E5%8B%B5%E8%A8%88%E5%8A%83) The company has adopted 2019, 2024, and 2025 incentive schemes to retain and motivate senior executives, management, and employees, with the 2025 scheme limiting awarded shares to 3% of total issued shares, and no options or awards granted under it during the reporting period - The company has adopted the **2019, 2024, and 2025 incentive schemes** to retain and motivate senior executives, senior management, and employees of the Group[82](index=82&type=chunk) - Under the 2025 incentive scheme, the maximum number of shares that may be issued upon exercise of all share options and restricted share units, together with options and awards issuable under other share schemes, shall not exceed **3%** of the total issued shares (excluding treasury shares) on the approval date, equivalent to **21,769,298 shares**[83](index=83&type=chunk) - During the reporting period and up to the date of this interim report, the company did not grant any share options or awards under the 2025 incentive scheme[83](index=83&type=chunk) [Changes in Directors' Information](index=24&type=section&id=%E8%91%A3%E4%BA%8B%E8%B3%87%E6%96%99%E8%AE%8A%E5%8B%95) Mr. ZHU Jonathan has been appointed as a Non-executive Director and a member of the Board's Strategy Committee, effective August 22, 2025 - Mr. ZHU Jonathan has been appointed as a Non-executive Director and a member of the Board's Strategy Committee, effective **August 22, 2025**[84](index=84&type=chunk) [Compliance with Corporate Governance Code and Model Code](index=24&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%88%99%E5%8F%8A%E6%A8%99%E6%BA%96%E5%AE%88%E5%88%99%E9%81%B5%E5%AE%88%E6%83%85%E6%B3%81) The company has adopted and maintains high corporate governance standards, complying with all applicable code provisions of the Corporate Governance Code and Model Code for the six months ended June 30, 2025, and up to the interim report date - The company has adopted the code provisions of the Corporate Governance Code and is committed to maintaining high standards of corporate governance to safeguard shareholders' interests and enhance corporate value[85](index=85&type=chunk) - For the six months ended June 30, 2025, and up to the date of this interim report, the company has complied with all applicable code provisions of the Corporate Governance Code and the Model Code[87](index=87&type=chunk)[88](index=88&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=25&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%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) For the six months ended June 30, 2025, the company repurchased 100,000 shares on the Stock Exchange for a total consideration of HKD 0.7 million, holding them as treasury shares, and as of the interim report date, held 1,617,000 shares designated as treasury shares Share Repurchase Details (January 2025) | Month of Repurchase | Total Number of Shares Repurchased | Repurchase Price Per Share (Highest/Lowest HKD) | Total Consideration (HKD million) | | :--- | :--- | :--- | :--- | | January 2025 | 100,000 | 7.62 / 6.73 | 0.7 | - As of the date of this interim report, the company held **1,617,000 shares** designated as treasury shares, with their intended use yet to be determined[90](index=90&type=chunk) [Audit Committee and Review of Financial Statements](index=26&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%9A%E5%8F%8A%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E7%9A%84%E5%AF%A9%E9%96%B1) The Audit Committee, comprising three independent non-executive directors, reviewed the unaudited condensed consolidated interim financial information for the six months ended June 30, 2025, with senior management and independent auditor Ernst & Young, expressing no disagreement with the accounting treatments adopted by the company - The Audit Committee comprises three independent non-executive directors: Mr. Yip Lam (Chairman), Mr. Zhang Wei, and Mr. Mi Zihou[91](index=91&type=chunk) - The Audit Committee has reviewed the Group's unaudited condensed consolidated interim financial information for the six months ended June 30, 2025, and has no disagreement with the accounting treatments adopted by the company[91](index=91&type=chunk) - Independent auditor Ernst & Young has reviewed the interim financial information in accordance with Hong Kong Standard on Review Engagements 2410, but did not express an audit opinion[91](index=91&type=chunk)[92](index=92&type=chunk) [Use of Proceeds](index=26&type=section&id=%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E7%94%A8%E9%80%94) The total net proceeds from the global offering, amounting to RMB 230.9 million, were fully utilized as disclosed in the prospectus by December 31, 2024 - The total net proceeds from the global offering, amounting to **RMB 230.9 million**, were fully utilized as of **December 31, 2024**[93](index=93&type=chunk) [Events After Reporting Period](index=27&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E4%BB%B6) The directors are not aware of any significant events occurring after June 30, 2025, up to the date of this interim report that require disclosure - The directors are not aware of any significant events occurring after **June 30, 2025**, up to the date of this interim report that require disclosure[95](index=95&type=chunk) [Interim Dividend](index=27&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended **June 30, 2025**[96](index=96&type=chunk) [Continuing Disclosure Obligations](index=27&type=section&id=%E6%8C%81%E7%BA%8C%E6%8A%AB%E9%9C%B2%E8%B2%AC%E4%BB%BB) As of June 30, 2025, the directors are not aware of any circumstances triggering disclosure obligations under Listing Rules 13.20, 13.21, and 13.22 - As of **June 30, 2025**, the directors are not aware of any circumstances triggering disclosure obligations under Listing Rules **13.20, 13.21, and 13.22**[97](index=97&type=chunk) [Independent Review Report](index=28&type=section&id=%E7%8D%A8%E7%AB%8B%E5%AF%A9%E9%96%B1%E5%A0%B1%E5%91%8A) Ernst & Young reviewed the company's condensed consolidated interim financial information for the six months ended June 30, 2025, in accordance with Hong Kong Standard on Review Engagements 2410, finding no matters suggesting the interim financial information was not prepared in all material respects in accordance with International Accounting Standard 34 - Ernst & Young has reviewed the interim financial information in accordance with **Hong Kong Standard on Review Engagements 2410**[99](index=99&type=chunk) - The scope of review is substantially less than that of an audit conducted in accordance with Hong Kong Standards on Auditing, thus no audit opinion was expressed[99](index=99&type=chunk) - Based on the review, nothing has come to their attention that causes them to believe the interim financial information is not prepared, in all material respects, in accordance with **International Accounting Standard 34**[100](index=100&type=chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=29&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the company reported revenue of RMB 1,270,559 thousand, gross profit of RMB 454,472 thousand, and profit for the period of RMB 28,569 thousand, with profit attributable to owners of the parent at RMB 27,273 thousand, and basic and diluted earnings per share both at RMB 0.04 Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Six Months Ended June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 1,270,559 | 1,465,701 | | Cost of sales | (816,087) | (905,968) | | Gross profit | 454,472 | 559,733 | | Other income and gains | 12,664 | 19,672 | | Selling and marketing expenses | (196,376) | (201,975) | | Administrative expenses | (112,638) | (107,531) | | Research and development costs | (54,904) | (58,707) | | Other expenses | (35,730) | (50,024) | | Finance costs | (21,980) | (27,404) | | Profit before tax | 45,508 | 133,764 | | Income tax expense | (16,939) | (30,286) | | Profit for the period | 28,569 | 103,478 | | Attributable to owners of the parent | 27,273 | 101,582 | | Attributable to non-controlling interests | 1,296 | 1,896 | | Basic earnings per share (RMB) | 0.04 | 0.14 | | Diluted earnings per share (RMB) | 0.04 | 0.14 | [Condensed Consolidated Statement of Financial Position](index=31&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the company's total non-current assets were RMB 1,576,771 thousand, total current assets were RMB 2,930,992 thousand, total current liabilities were RMB 1,870,207 thousand, and total non-current liabilities were RMB 865,753 thousand, resulting in net assets of RMB 1,771,803 thousand, with equity attributable to owners of the parent at RMB 1,641,856 thousand Condensed Consolidated Statement of Financial Position (As of June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | **NON-CURRENT ASSETS** | | | | Property and equipment | 379,912 | 398,520 | | Right-of-use assets | 145,143 | 165,719 | | Goodwill | 79,802 | 79,802 | | Other intangible assets | 150,478 | 154,064 | | Total non-current assets | 1,576,771 | 1,634,339 | | **CURRENT ASSETS** | | | | Inventories | 115,875 | 126,935 | | Trade and bills receivables | 1,544,989 | 1,377,364 | | Cash and bank balances | 751,113 | 1,043,833 | | Total current assets | 2,930,992 | 3,050,678 | | **CURRENT LIABILITIES** | | | | Trade and bills payables | 681,400 | 721,814 | | Interest-bearing bank borrowings | 582,419 | 467,975 | | Total current liabilities | 1,870,207 | 1,925,138 | | **NON-CURRENT LIABILITIES** | | | | Interest-bearing bank borrowings | 744,835 | 837,943 | | Total non-current liabilities | 865,753 | 985,203 | | **TOTAL EQUITY** | 1,771,803 | 1,774,676 | [Condensed Consolidated Statement of Changes in Equity](index=33&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) For the six months ended June 30, 2025, total equity attributable to owners of the parent slightly decreased to RMB 1,641,856 thousand from RMB 1,648,085 thousand at the beginning of the period, influenced by profit for the period of RMB 27,273 thousand, share repurchases of RMB 32,783 thousand, and acquisition of non-controlling interests of RMB 7,374 thousand Condensed Consolidated Statement of Changes in Equity (Six Months Ended June 30) | Item | January 1, 2025 (RMB thousand) | Profit for the period (RMB thousand) | Share repurchases (RMB thousand) | Acquisition of non-controlling interests (RMB thousand) | June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total equity attributable to owners of the parent | 1,648,085 | 27,273 | (32,783) | (7,374) | 1,641,856 | | Non-controlling interests | 126,591 | 1,296 | — | 2,060 | 129,947 | | Total equity | 1,774,676 | 28,569 | (32,783) | (5,314) | 1,771,803 | - As of June 30, 2025, total equity attributable to owners of the parent was **RMB 1,641,856 thousand**, a decrease of **RMB 6,229 thousand** from January 1, 2025[109](index=109&type=chunk) - Share repurchases during the period resulted in a **RMB 32,783 thousand** reduction in equity[109](index=109&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=35&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the six months ended June 30, 2025, net cash used in operating activities was RMB (164,949) thousand, net cash used in investing activities was RMB (47,418) thousand, and net cash used in financing activities was RMB (76,913) thousand, with cash and cash equivalents at period-end totaling RMB 751,113 thousand, a decrease of RMB 289,280 thousand from the beginning of the period Condensed Consolidated Statement of Cash Flows (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash flows used in operating activities | (164,949) | (162,780) | | Net cash flows used in investing activities | (47,418) | (1,066) | | Net cash flows used in financing activities | (76,913) | (24,821) | | Net decrease in cash and cash equivalents | (289,280) | (188,667) | | Cash and cash equivalents at beginning of period | 1,043,833 | 959,423 | | Cash and cash equivalents at end of period | 751,113 | 767,961 | - Net cash flows used in operating activities were primarily impacted by an increase in trade and bills receivables of **RMB 194,011 thousand** and a decrease in other payables and accrued charges of **RMB 85,599 thousand**[112](index=112&type=chunk) - Net cash flows used in investing activities were mainly due to the purchase of property and equipment items totaling **RMB 55,249 thousand**[114](index=114&type=chunk) - Net cash flows used in financing activities were primarily due to repayment of bank loans of **RMB 161,000 thousand**, lease payments of **RMB 40,889 thousand**, and share repurchases of **RMB 32,783 thousand**[114](index=114&type=chunk) [Notes to the Condensed Consolidated Financial Information](index=37&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) These notes detail the basis of preparation, changes in accounting policies, operating segment information, revenue composition, profit before tax adjustments, income tax, dividends, earnings per share calculation, property and equipment changes, trade and bills receivables and payables, prepayments, other payables, share capital, share incentive schemes, commitments, related party transactions, and fair value information for financial instruments [1. Company Information](index=37&type=section&id=1.%20Company%20Information) Adicon Holdings Limited, incorporated in the Cayman Islands on March 20, 2008, listed on the HKEX Main Board since June 30, 2023, operates as an investment holding company, with subsidiaries primarily engaged in providing medical diagnostic services and trading medical testing equipment in China - Adicon Holdings Limited was incorporated in the Cayman Islands on **March 20, 2008**, and its shares have been listed on the Main Board of the Stock Exchange of Hong Kong since **June 30, 2023**[116](index=116&type=chunk) - The company is an investment holding company, and its subsidiaries are primarily engaged in providing medical diagnostic services and trading medical testing equipment in China[116](index=116&type=chunk) [2.1 Basis of Preparation](index=37&type=section&id=2.1%20Basis%20of%20Preparation) The condensed consolidated interim financial information is prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024 - The condensed consolidated interim financial information has been prepared in accordance with **International Accounting Standard 34 'Interim Financial Reporting'**[117](index=117&type=chunk) [2.2 Changes in Accounting Policies and Disclosures](index=37&type=section&id=2.2%20Changes%20in%20Accounting%20Policies%20and%20Disclosures) The accounting policies adopted for the condensed consolidated interim financial information are consistent with those in the 2024 annual consolidated financial statements, with the initial adoption of amended IAS 21 'Lack of Exchangeability' having no impact due to the Group's convertible transaction currencies - The accounting policies adopted in the preparation of the condensed consolidated interim financial information are consistent with those applied in the **2024 annual consolidated financial statements**[118](index=118&type=chunk) - The Group first adopted the amended **International Accounting Standard 21 'Lack of Exchangeability'**, but this amendment had no impact on the condensed consolidated interim financial information as the Group's transaction currencies are convertible[119](index=119&type=chunk) [3. Operating Segment Information](index=38&type=section&id=3.%20Operating%20Segment%20Information) The Group manages its business units by products and services, but no geographical segment information is presented under IFRS 8 as almost all non-current assets are located in mainland China, and no single customer accounted for 10% or more of the Group's revenue during the period - The Group manages its entire business unit by its products and services, with management monitoring overall operating results[120](index=120&type=chunk) - No geographical segment information is presented as almost all non-current assets are located in mainland China[120](index=120&type=chunk) - During the period, no single customer accounted for **10% or more** of the Group's revenue[121](index=121&type=chunk) [4. Revenue](index=38&type=section&id=4.%20Revenue) For the six months ended June 30, 2025, the company's medical diagnostic services revenue was RMB 1,270,559 thousand, with the majority (RMB 1,247,993 thousand) recognized at a point in time, and revenue recognized from contract liabilities at the beginning of the period amounted to RMB 29,905 thousand Revenue Disaggregation Information (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Medical diagnostic services | 1,270,559 | 1,465,701 | | Timing of revenue recognition: | | | | At a point in time | 1,247,993 | 1,446,544 | | Over time | 22,566 | 19,157 | | Total | 1,270,559 | 1,465,701 | - For the six months ended June 30, 2025, revenue recognized from contract liabilities at the beginning of the period amounted to **RMB 29,905 thousand**[124](index=124&type=chunk) [5. Profit Before Tax](index=39&type=section&id=5.%20Profit%20Before%20Tax) The Group's profit before tax for the six months ended June 30, 2025, was RMB 45,508 thousand, after deducting cost of services of RMB 816,087 thousand, research and development costs of RMB 54,904 thousand, net exchange losses of RMB 5,335 thousand, and provision for expected credit losses of RMB 26,424 thousand Profit Before Tax Adjustment Items (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of services provided | 816,087 | 905,968 | | Research and development costs | 54,904 | 58,707 | | Net exchange losses | 5,335 | 93 | | Loss on disposal of items of property and equipment and other intangible assets | 1,522 | 751 | | Depreciation of property and equipment | 53,471 | 51,206 | | Depreciation of right-of-use assets | 29,304 | 28,611 | | Amortisation of intangible assets | 5,523 | 4,902 | | Impairment losses on financial assets under ECL model | 26,424 | 39,488 | | Share awards | 3,523 | 205 | [6. Income Tax](index=40&type=section&id=6.%20Income%20Tax) The Group is subject to income tax on profits in its operating jurisdictions, with Cayman Islands exempt, Hong Kong subsidiaries at 8.25% or 16.5% profits tax, and mainland China subsidiaries at 25% corporate income tax (some with preferential rates), totaling RMB 16,939 thousand in income tax expense for the six months ended June 30, 2025 - The Cayman Islands are exempt from income tax, Hong Kong subsidiaries are subject to profits tax at **8.25% or 16.5%**, and mainland China subsidiaries are subject to corporate income tax at **25%** (some enjoying preferential tax rates)[128](index=128&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk) - The Group's annual consolidated revenue is below **EUR 750 million**, thus not falling within the scope of Pillar Two legislative templates[131](index=131&type=chunk) Income Tax Expense Analysis (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current income tax | 14,612 | 31,725 | | Deferred income tax | 2,327 | (1,439) | | Total tax expense for the period | 16,939 | 30,286 | [7. Dividends](index=41&type=section&id=7.%20Dividends) The company neither paid nor declared any dividends for the six months ended June 30, 2025 - The company neither paid nor declared any dividends for the six months ended **June 30, 2025**[135](index=135&type=chunk) [8. Earnings Per Share Attributable to Owners of the Company](index=41&type=section&id=8.%20Earnings%20Per%20Share%20Attributable%20to%20Owners%20of%20the%20Company) For the six months ended June 30, 2025, basic and diluted earnings per share attributable to owners of the company were both RMB 0.04, a significant decrease from RMB 0.14 in the same period of 2024, with the weighted average number of ordinary shares used for basic EPS calculation being 710,148 thousand shares Earnings Per Share Calculation (Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit attributable to owners of the parent (RMB thousand) | 27,273 | 101,582 | | Weighted average number of ordinary shares in issue during the period (thousand shares) | 710,148 | 727,290 | | Basic earnings per share (RMB) | 0.04 | 0.14 | | Diluted earnings per share (RMB) | 0.04 | 0.14 | - For the period ended June 30, 2025, the calculation of diluted earnings per share did not include restricted share units under the company's share award schemes, as their inclusion would have an anti-dilutive effect[136](index=136&type=chunk) [9. Property, Plant and Equipment](index=42&type=section&id=9.%20Property,%20Plant%20and%20Equipment) For the six months ended June 30, 2025, the Group acquired assets at a cost of RMB 39,350 thousand and disposed of assets with a net book value of RMB 4,486 thousand, resulting in a net loss on disposal of RMB 1,492 thousand Changes in Property, Plant and Equipment (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of assets acquired | 39,350 | 45,024 | | Net book value of assets disposed of | 4,486 | 1,999 | | Net loss on disposal | 1,492 | 751 | [10. Trade and Bills Receivables](index=42&type=section&id=10.%20Trade%20and%20Bills%20Receivables) As of June 30, 2025, total trade and bills receivables were RMB 1,931,981 thousand, with a net amount of RMB 1,544,989 thousand after deducting RMB 386,992 thousand for expected credit loss provisions; credit terms are typically 90 to 120 days, with the highest proportion of trade receivables aged 1 to 6 months, and expected credit loss provisions increased from the beginning of the period Trade and Bills Receivables (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade receivables | 1,927,996 | 1,745,680 | | Bills receivables | 3,985 | 4,564 | | Total | 1,931,981 | 1,750,244 | | Provision for expected credit losses | (386,992) | (372,880) | | Net | 1,544,989 | 1,377,364 | - The Group's trade terms with customers are primarily on credit, with credit periods generally ranging from **90 to 120 days**[139](index=139&type=chunk) Ageing Analysis of Trade and Bills Receivables (As of June 30) | Ageing | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | 1 to 6 months | 956,227 | 855,432 | | 6 months to 1 year | 268,862 | 213,256 | | 1 to 2 years | 250,623 | 261,867 | | 2 to 3 years | 64,032 | 40,694 | | Over 3 years | 5,245 | 6,115 | | Total | 1,544,989 | 1,377,364 | Movement in Provision for Expected Credit Losses on Trade Receivables (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | At beginning of period/year | 372,880 | 242,373 | | Net impairment losses | 26,386 | 139,804 | | Write-off | (12,274) | (9,297) | | At end of period/year | 386,992 | 372,880 | - The Group uses a provision matrix to determine expected credit losses, with provision rates based on ageing, historical default, and past collection experience, adjusted to reflect current and forward-looking economic conditions[143](index=143&type=chunk) [11. Prepayments, Deposits and Other Receivables](index=46&type=section&id=11.%20Prepayments,%20Deposits%20and%20Other%20Receivables) As of June 30, 2025, total prepayments, deposits, and other receivables amounted to RMB 258,441 thousand, a slight increase from year-end 2024, primarily comprising subscription monies receivable from share option exercises, long-term receivables, investment prepayments, and prepaid taxes, with the Group maintaining strict control over these receivables and no significant concentration of credit risk Prepayments, Deposits and Other Receivables (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Subscription monies receivable from exercise of share options | 83,741 | 83,851 | | Long-term receivables | 30,077 | 29,601 | | Investment prepayments | 18,200 | 18,200 | | Deposits | 22,302 | 20,553 | | Prepayments | 48,717 | 43,778 | | Prepaid taxes | 32,116 | 29,413 | | Total (net of impairment allowance) | 258,441 | 251,064 | - Subscription monies receivable from the exercise of share options, approximately **RMB 83,741 thousand**, have not yet been received due to restrictions on foreign exchange sales and payments[147](index=147&type=chunk) - Investment prepayments of approximately **RMB 18,200 thousand** represent prepayments for the proposed acquisition of two ICLs in Henan[147](index=147&type=chunk) - The Group maintains strict control over outstanding receivables and has no significant concentration of credit risk[151](index=151&type=chunk) [12. Trade and Bills Payables](index=48&type=section&id=12.%20Trade%20and%20Bills%20Payables) As of June 30, 2025, total trade and bills payables amounted to RMB 681,400 thousand, a decrease from year-end 2024, with most payables (RMB 600,863 thousand) due within one year, and trade payables are non-interest-bearing, generally settled within 60 to 120 days Trade and Bills Payables (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade and bills payables | 681,400 | 721,814 | Ageing Analysis of Trade and Bills Payables (As of June 30) | Ageing | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 600,863 | 649,124 | | 1 to 2 years | 25,597 | 47,205 | | 2 to 3 years | 44,111 | 23,502 | | Over 3 years | 10,829 | 1,983 | | Total | 681,400 | 721,814 | - Trade payables are non-interest-bearing and generally settled within **60 to 120 days**[153](index=153&type=chunk) [13. Other Payables and Accrued Charges](index=48&type=section&id=13.%20Other%20Payables%20and%20Accrued%20Charges) As of June 30, 2025, total other payables and accrued charges amounted to RMB 515,716 thousand, a decrease from year-end 2024, primarily comprising salaries payable, accrued expenses, payables arising from acquisitions, and amounts due to non-controlling shareholders Other Payables and Accrued Charges (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Salaries payable | 154,308 | 226,178 | | Accrued expenses | 128,183 | 141,673 | | Payables arising from acquisitions | 99,306 | 99,306 | | Other payables | 71,800 | 83,811 | | Amounts due to non-controlling shareholders | 61,175 | 61,175 | | Deferred income | 944 | 1,237 | | Total | 515,716 | 613,380 | - Payables arising from acquisitions include the present value of put option exercise prices related to non-controlling interests in Shangrao Adicon and Jiangxi Jince of **RMB 42,160 thousand**, as well as contingent consideration for Henan Adicon of **RMB 13,337 thousand** and the present value of put option exercise prices related to non-controlling interests of **RMB 43,809 thousand**[156](index=156&type=chunk) - Amounts due to non-controlling shareholders of **RMB 61,175 thousand** represent revenue from COVID-19 testing services received by Henan Adicon in 2021, which is repayable to the then shareholders[156](index=156&type=chunk) [14. Share Capital](index=49&type=section&id=14.%20Share%20Capital) As of June 30, 2025, the company's issued and fully paid share capital comprised 727,260,291 ordinary shares with a par value of RMB 97 thousand, with treasury shares increasing to 18,725,000 shares, valued at RMB 144,903 thousand, including 5,659,500 shares repurchased by the trust for the 2024 share incentive scheme Share Capital and Treasury Shares (As of June 30) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Number of issued shares | 727,260,291 shares | 727,260,291 shares | | Share capital (RMB thousand) | 97 | 97 | | Number of treasury shares | 18,725,000 shares | 12,965,500 shares | | Treasury shares (RMB thousand) | 144,903 | 112,120 | - For the six months ended June 30, 2025, the trust purchased **5,659,500 shares** of the company for a total consideration of **RMB 32,123 thousand** to administer the 2024 share incentive scheme, holding them as treasury shares[159](index=159&type=chunk) [15. Share Incentive Schemes](index=51&type=section&id=15.%20Share%20Incentive%20Schemes) The company operates a Pre-IPO Employee Incentive Scheme and a 2024 Incentive Scheme to motivate directors and employees, with both schemes granting share options and restricted share units subject to time and financial performance vesting conditions, resulting in share award expenses of RMB 103 thousand and RMB 3,420 thousand respectively for the six months ended June 30, 2025 - The Pre-IPO Employee Incentive Scheme aims to promote the company's success and incentivize the Group's directors and employees, allowing for the grant of up to **10%** of the existing ordinary share capital[161](index=161&type=chunk) - Under the Pre-IPO Employee Incentive Scheme, share options and restricted share units totaling up to **101,171,226 underlying shares** have been granted, with vesting conditions including time and financial performance targets[161](index=161&type=chunk)[163](index=163&type=chunk) - The 2024 Incentive Scheme aims to incentivize senior executives and senior management, allowing for the repurchase of up to **3%** of outstanding shares[164](index=164&type=chunk) - Under the 2024 Incentive Scheme, up to **9,150,000 restricted share units** have been granted to senior management, with vesting conditions also including time and financial performance targets[164](index=164&type=chunk)[166](index=166&type=chunk)[167](index=167&type=chunk) Share Award Expenses (Six Months Ended June 30) | Incentive Scheme | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Pre-IPO Employee Incentive Scheme | 103 | 205 | | 2024 Incentive Scheme | 3,420 | — | [16. Commitments](index=53&type=section&id=16.%20Commitments) As of June 30, 2025, the Group's capital commitments amounted to RMB 9,586 thousand, primarily for the acquisition of property and equipment Contractual Commitments (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Acquisition of property and equipment | 9,586 | 9,303 | [17. Related Party Transactions](index=53&type=section&id=17.%20Related%20Party%20Transactions) The Group engages in related party transactions with Arkray Biotech (Hangzhou) Co., Ltd. and Aijian Medical Devices (Hangzhou) Co., Ltd., both controlled by Mr. Lin Jixun, including sales to Arkray, purchases from Arkray, and rental income from Aijian, with outstanding trade receivables and payables with related parties as of June 30, 2025 - Related parties include Arkray Biotech (Hangzhou) Co., Ltd. and Aijian Medical Devices (Hangzhou) Co., Ltd., both controlled by Mr. Lin Jixun, a co-founder and Non-executive Director of the company[170](index=170&type=chunk) Transactions with Related Parties (Six Months Ended June 30) | Type of transaction | Related party | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | :--- | | Sales to related parties | Arkray | 34 | 47 | | Purchases from related parties | Arkray | 540 | 820 | | Rental income from related parties | Aijian | 4,673 | 3,551 | Outstanding Balances with Related Parties (As of June 30) | Item | Related party | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | :--- | | Total amounts due from related parties | | 2,539 | 2,536 | | Total amounts due to related parties | | 1,626 | 1,081 | Key Management Personnel Remuneration (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Salaries, allowances and benefits in kind | 2,558 | 3,834 | | Performance-related bonuses | 256 | 1,302 | | Equity-settled share-based payment expenses | 103 | 160 | | Total | 2,917 | 5,296 | [18. Fair Value and Fair Value Hierarchy of Financial Instruments](index=55&type=section&id=18.%20Fair%20Value%20and%20Fair%20Value%20Hierarchy%20of%20Financial%20Instruments) The Group's financial instruments' carrying amounts approximate their fair values due to short-term maturities, with contingent consideration classified as Level 3 fair value measurement at RMB 13,337 thousand, and management calculates the fair value of non-current portions by discounting expected future cash flows Carrying Amounts and Fair Values of Financial Instruments (As of June 30) | Item | 2025 Carrying amount (RMB thousand) | 2025 Fair value (RMB thousand) | | :--- | :--- | :--- | | Pledged deposits | 650,000 | 650,000 | | Contingent consideration | 13,337 | 13,337 | | Interest-bearing bank borrowings | 1,327,254 | 1,327,254 | - Management assesses that the fair values of most financial instruments approximate their carrying amounts, primarily due to their short-term maturities[177](index=177&type=chunk) - Contingent consideration is classified as a **Level 3 fair value measurement**, with its fair value being **RMB 13,337 thousand**[180](index=180&type=chunk)[181](index=181&type=chunk) - During the period, there were no transfers between Level 1 and Level 2 fair value measurements, nor any transfers into or out of Level 3 for financial assets and financial liabilities[181](index=181&type=chunk) [19. Events After Reporting Period](index=57&type=section&id=19.%20Events%20After%20Reporting%20Period) No significant events occurred after June 30, 2025 - No significant events occurred after **June 30, 2025**[182](index=182&type=chunk)

CONTENTS 目錄 2 Company Profile 公司簡介 3 Corporate Information 公司資料 6 Management Discussion and Analysis 管理層討論與分析 30 Disclosure of Interests 權益披露 36 Corporate Governance and Other Information 企業管治及其他資料 66 Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income 中期簡明綜合損益及其他全面收益表 67 Interim Condensed Consolidated Statement of Financial Position 中期簡明綜合財務狀況表 69 Interim Condensed Consolidated Statement of Changes in Equity 中期簡明綜合權益變動表 71 Interim Condensed Consolidated Statement of Ca ...

[Supplementary Announcement](index=1&type=section&id=Supplementary%20Announcement) [Purpose and Background of Announcement](index=1&type=section&id=Purpose%20and%20Background%20of%20Announcement) This announcement supplements the annual report of Zhujiang Petroleum and Natural Gas Steel Pipe Holdings Limited regarding its share option scheme, with other report contents remaining unchanged - This announcement supplements Zhujiang Petroleum and Natural Gas Steel Pipe Holdings Limited's annual report dated April 25, 2025, specifically providing additional details on the share option scheme disclosed in the Directors' Report (pages 61-63)[3](index=3&type=chunk)[4](index=4&type=chunk) [Supplementary Information on Share Option Scheme](index=1&type=section&id=Supplementary%20Information%20on%20Share%20Option%20Scheme) This section details the total shares available for issuance under the share option scheme, its proportion to issued capital, and the remaining term Share Option Scheme Details | Metric | Value | | :--- | :--- | | Total shares available for issue under Share Option Scheme | 101,114,200 shares | | Percentage of total issued share capital | Approximately 10% | | Remaining term of Share Option Scheme (as of December 31, 2024) | 5.5 years | [Board Member Information](index=1&type=section&id=Board%20Member%20Information) This announcement provides the current composition of the board of directors, including executive and independent non-executive members - As of this announcement date, the board includes **two executive directors** (Mr. Chen Chang, Ms. Chen Zhaonian) and **three independent non-executive directors** (Mr. Chen Ping, Mr. Ouyang Guanghua, Mr. Zhan Jianzhou)[5](index=5&type=chunk)

[Corporate Information](index=3&type=section&id=Corporate%20Information) [BOARD OF DIRECTORS](index=3&type=section&id=BOARD%20OF%20DIRECTORS) The Board's composition includes executive, non-executive, and independent non-executive directors, noting recent appointments and resignations - The Board of Directors is composed of executive directors including **Mr Wong Tat Tong (Chairman)**, Ms Fan Yee Man, and Mr Kam Chun Pong, along with non-executive and independent non-executive directors[5](index=5&type=chunk)[6](index=6&type=chunk) - Mr Timothy John Collins and Mr Li Te Hua resigned as non-executive directors on **May 10, 2025**, and **April 1, 2025**, respectively[5](index=5&type=chunk)[6](index=6&type=chunk) - Ms Yeung Po Yee, Pauline and Mr Ho Hung Wai, William were appointed as non-executive directors on **June 12, 2025**[5](index=5&type=chunk)[6](index=6&type=chunk) [BOARD COMMITTEES](index=3&type=section&id=BOARD%20COMMITTEES) This section details the membership and chairmanship of the Audit, Nomination, and Remuneration Committees - The Audit Committee consists of **Mr Tang Kwai Chang (Chairman)**, Mr Wong Man Fai, and Mr Luk Koon Cheung[6](index=6&type=chunk)[7](index=7&type=chunk) - The Nomination Committee is composed of **Mr Wong Tat Tong (Chairman)**, Ms Fan Yee Man, Mr Tang Kwai Chang, Mr Wong Man Fai, and Mr Luk Koon Cheung, with Ms Fan and Mr Tang appointed on **June 12, 2025**[6](index=6&type=chunk)[7](index=7&type=chunk) - The Remuneration Committee is composed of **Mr Wong Man Fai (Chairman)**, Mr Wong Tat Tong, and Mr Tang Kwai Chang[9](index=9&type=chunk)[10](index=10&type=chunk) [COMPANY SECRETARY](index=4&type=section&id=COMPANY%20SECRETARY) This section lists the company's secretary and authorized representatives - The Company Secretary is **Ms Fan Yee Man** (Hong Kong Institute of Certified Public Accountants)[9](index=9&type=chunk)[10](index=10&type=chunk) - The authorized representatives are **Ms Fan Yee Man** and **Mr Kam Chun Pong**[9](index=9&type=chunk)[10](index=10&type=chunk) [REGISTERED PUBLIC INTEREST ENTITY AUDITOR](index=4&type=section&id=REGISTERED%20PUBLIC%20INTEREST%20ENTITY%20AUDITOR) This section provides information on the company's registered public interest entity auditor and principal bankers - The registered public interest entity auditor is **Ernst & Young**[9](index=9&type=chunk)[10](index=10&type=chunk) - Principal bankers include **Bank of China (Hong Kong) Limited** and **Hang Seng Bank Limited**[9](index=9&type=chunk)[10](index=10&type=chunk) [REGISTERED OFFICE IN BERMUDA](index=4&type=section&id=REGISTERED%20OFFICE%20IN%20BERMUDA) This section lists the company's registered office in Bermuda and its head office and principal place of business in Hong Kong - The registered office in Bermuda is located at **Canon's Court, 22 Victoria Street, Hamilton, HM 12, Bermuda**[9](index=9&type=chunk)[10](index=10&type=chunk) - The head office and principal place of business in Hong Kong is at **Flats F–J, 11/F, Block 1, Kwai Tak Industrial Centre, 15–33 Kwai Tak Street, Kwai Chung, New Territories, Hong Kong**[9](index=9&type=chunk)[10](index=10&type=chunk) [PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE IN BERMUDA](index=5&type=section&id=PRINCIPAL%20SHARE%20REGISTRAR%20AND%20TRANSFER%20OFFICE%20IN%20BERMUDA) This section provides information on the company's share registrars in Bermuda and Hong Kong, as well as its website and stock code - The principal share registrar in Bermuda is **Appleby Global Corporate Services (Bermuda) Ltd**[12](index=12&type=chunk) - The Hong Kong share registrar is **Tricor Investor Services Limited**[12](index=12&type=chunk) - The company's website is **www.twcoffee.com** and its stock code is **2119**[13](index=13&type=chunk) [Management Discussion and Analysis](index=6&type=section&id=Management%20Discussion%20and%20Analysis) [BUSINESS REVIEW](index=6&type=section&id=BUSINESS%20REVIEW) The Group achieved revenue growth amid rising costs and competition, but profit declined due to margin contraction and the absence of a prior-period one-off gain - The Group is an integrated business-to-business coffee and tea beverage solutions provider in Hong Kong, Macau, and Mainland China, covering the entire value chain[14](index=14&type=chunk)[16](index=16&type=chunk) Key Financial Performance for H1 2025 | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 380.4 | 349.4 | 8.9% | | Profit Attributable to Owners of the Parent | 24.9 | 36.1 | -31.0% | | Gross Profit Margin | 30.5% | 35.7% | -5.2 p.p. | - The profit decline was mainly impacted by the absence of a **one-off gain on asset disposal (approx HK$12.4 million)** in H1 2024 and a decrease in gross profit margin from **35.7% to 30.5%** due to rising global coffee bean prices[17](index=17&type=chunk)[19](index=19&type=chunk) - Excluding the one-off gain and withholding tax on dividend distribution, profit attributable to owners of the parent **decreased by only 6.7%**, reflecting the resilience of the core business[18](index=18&type=chunk)[20](index=20&type=chunk) [BUSINESS PROSPECT](index=8&type=section&id=BUSINESS%20PROSPECT) The Group will prudently navigate a competitive Hong Kong market and a recovering China market by enhancing efficiency, streamlining operations, and managing costs - The business environment in Hong Kong is expected to remain highly competitive and sluggish, while the China market shows initial signs of recovery with gradually improving consumer confidence[22](index=22&type=chunk)[25](index=25&type=chunk) - The Group's new coffee production line, which commenced operations during the period, is a key step toward enhancing production efficiency and supporting long-term growth[23](index=23&type=chunk)[26](index=26&type=chunk) - The Group will continue to streamline its China operations, enhance cost management, and cautiously seize business opportunities to safeguard profitability[23](index=23&type=chunk)[24](index=24&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) [FINANCIAL REVIEW](index=9&type=section&id=FINANCIAL%20REVIEW) This section analyzes the Group's financial performance, including revenue growth, cost increases, margin decline, expense control, and changes in net profit [Revenue](index=9&type=section&id=Revenue) Group revenue grew by 8.9% to HK$380.4 million, driven by increased sales of coffee and tea products in Hong Kong due to price adjustments Revenue Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 380.4 | 349.4 | 31.0 | 8.9% | - The increase in revenue was primarily due to higher sales of coffee and tea products in Hong Kong, resulting from price adjustments in response to the significant rise in coffee bean commodity prices[28](index=28&type=chunk)[31](index=31&type=chunk) [Cost of Sales](index=9&type=section&id=Cost%20of%20Sales) Cost of sales increased by 17.8% to HK$264.5 million, mainly due to the soaring cost of raw materials for coffee products Cost of Sales Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Cost of Sales | 264.5 | 224.6 | 39.9 | 17.8% | - The increase in cost of sales was mainly attributable to the rising cost of raw materials for coffee products, driven by the surge in coffee bean commodity prices[29](index=29&type=chunk)[32](index=32&type=chunk) [Gross Profit and Gross Profit Margin](index=9&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit decreased by 7.1% to HK$115.9 million, with the gross profit margin declining to 30.5% from 35.7% due to higher costs Gross Profit and Gross Profit Margin Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Gross Profit | 115.9 | 124.8 | -8.9 | -7.1% | | Gross Profit Margin | 30.5% | 35.7% | -5.2 p.p. | | [Other Income and Gains, Net](index=10&type=section&id=Other%20Income%20and%20Gains%2C%20Net) Other income and gains, net, decreased significantly by 84.2% to HK$2.4 million, primarily due to the absence of a one-off gain on asset disposal recorded in the prior period Other Income and Gains, Net Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Other Income and Gains, Net | 2.4 | 15.2 | -12.8 | -84.2% | - The decrease was mainly due to the absence of the **one-off gain of HK$12.4 million** from the disposal of assets classified as held for sale[34](index=34&type=chunk)[37](index=37&type=chunk) [Selling and Distribution Expenses](index=10&type=section&id=Selling%20and%20Distribution%20Expenses) Selling and distribution expenses decreased by 3.0% to HK$48.4 million, mainly due to lower staff costs and reduced profit-based expenses Selling and Distribution Expenses Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Selling and Distribution Expenses | 48.4 | 49.9 | -1.5 | -3.0% | - The decrease was primarily attributable to lower staff costs and a reduction in profit-based expenses resulting from the lower gross profit margin[35](index=35&type=chunk)[38](index=38&type=chunk) [General and Administrative Expenses](index=10&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses decreased by 7.8% to HK$37.7 million, mainly due to reduced staff costs and depreciation General and Administrative Expenses Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | General and Administrative Expenses | 37.7 | 40.9 | -3.2 | -7.8% | - The decrease was mainly due to lower staff costs and depreciation[36](index=36&type=chunk)[39](index=39&type=chunk) [Other Expenses, Net](index=11&type=section&id=Other%20Expenses%2C%20Net) Other expenses, net, decreased by 48.5% to HK$1.7 million, benefiting from a net foreign exchange gain and lower impairment of trade receivables Other Expenses, Net Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Other Expenses, Net | 1.7 | 3.3 | -1.6 | -48.5% | - The decrease was mainly due to a net foreign exchange gain from RMB appreciation (compared to a loss in the prior period) and lower impairment of trade receivables[41](index=41&type=chunk)[44](index=44&type=chunk) [Finance Costs](index=11&type=section&id=Finance%20Costs) Finance costs remained stable at HK$0.8 million, comprising interest on lease liabilities and bank borrowings Finance Costs Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Finance Costs | 0.8 | 0.8 | 0.0 | 1.6% | - Finance costs represent interest on lease liabilities and bank borrowings[42](index=42&type=chunk)[45](index=45&type=chunk) [Taxation](index=11&type=section&id=Taxation) Taxation decreased by 45.6% to HK$4.9 million due to lower pre-tax profit and the absence of withholding tax on dividend distributions from Mainland China Taxation and Effective Tax Rate Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Taxation | 4.9 | 9.0 | -4.1 | -45.6% | | Effective Tax Rate | 16.5% | 19.9% | -3.4 p.p. | | - The decrease was mainly due to lower profit before tax and the absence of the **5% withholding tax** on dividend distributions from foreign-invested enterprises in Mainland China during the period[43](index=43&type=chunk)[46](index=46&type=chunk) [Profit for The Period and Net Profit Margin](index=12&type=section&id=Profit%20for%20The%20Period%20and%20Net%20Profit%20Margin) Profit for the period decreased by 31.0% to HK$24.9 million, with the net profit margin declining to 6.5% from 10.3% Profit for The Period and Net Profit Margin Change | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Profit for the Period | 24.9 | 36.1 | -11.2 | -31.0% | | Net Profit Margin | 6.5% | 10.3% | -3.8 p.p. | | [Capital Expenditure and Commitments](index=12&type=section&id=Capital%20Expenditure%20and%20Commitments) Capital expenditure on property, plant and equipment increased significantly to HK$37.6 million, while capital commitments stood at HK$3.9 million Capital Expenditure and Commitments | Indicator | H1 2025 (HK$ million) | H1 2024 (HK$ million) | YoY Change (HK$ million) | | :--- | :--- | :--- | :--- | | Additions to Property, Plant and Equipment | 37.6 | 13.6 | 24.0 | | Capital Commitments (at period end) | 3.9 | 5.0 (as at Dec 31, 2024) | -1.1 | - Capital expenditure was primarily for the purchase of coffee and tea machines for lease to customers, as well as production machinery[49](index=49&type=chunk)[52](index=52&type=chunk) - Capital commitments mainly related to contracts for production machinery for the Group's coffee roasting and packaging systems[50](index=50&type=chunk)[52](index=52&type=chunk) [Borrowings](index=13&type=section&id=Borrowings) As of June 30, 2025, the Group's total interest-bearing bank borrowings were HK$4.3 million, a slight increase from year-end 2024 Interest-bearing Bank Borrowings | Indicator | Jun 30, 2025 (HK$ million) | Dec 31, 2024 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Total Interest-bearing Bank Borrowings | 4.3 | 4.0 | 0.3 | [Net Current Assets](index=13&type=section&id=Net%20Current%20Assets) Net current assets increased to HK$320.9 million as of June 30, 2025, mainly due to higher inventories, partially offset by an increase in trade payables Net Current Assets | Indicator | Jun 30, 2025 (HK$ million) | Dec 31, 2024 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Net Current Assets | 320.9 | 308.0 | 12.9 | - The increase in net current assets was primarily due to an increase in inventories, which was partially offset by an increase in trade payables[54](index=54&type=chunk)[59](index=59&type=chunk) [Liquidity and Financial Resources](index=13&type=section&id=Liquidity%20and%20Financial%20Resources) The Group held cash and cash equivalents of HK$146.6 million as of June 30, 2025, with the Board considering its financial position to be solid Cash and Cash Equivalents | Indicator | Jun 30, 2025 (HK$ million) | Dec 31, 2024 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 146.6 | 170.4 | -23.8 | - The Board considers the Group's financial position to be solid and believes it has sufficient resources to support its operations and meet its capital expenditure in the foreseeable future[55](index=55&type=chunk)[60](index=60&type=chunk) [Capital Structure](index=13&type=section&id=Capital%20Structure) As of June 30, 2025, the Group's capital structure consisted of issued share capital and reserves - On June 30, 2025, the Group's capital structure comprised issued share capital and reserves[56](index=56&type=chunk)[61](index=61&type=chunk) [Future Plans for Material Investments and Capital Assets](index=13&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) The Group has no specific plans for material investments or capital assets in the coming year - The Group does not have any specific plans for material investments and capital assets in the coming year[57](index=57&type=chunk)[62](index=62&type=chunk) [Material Acquisition and Disposal](index=14&type=section&id=Material%20Acquisition%20and%20Disposal) The Group did not undertake any material acquisitions or disposals of subsidiaries, associates, or joint ventures during the reporting period - During the six months ended June 30, 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, and joint ventures[63](index=63&type=chunk)[67](index=67&type=chunk) [Contingent Liabilities](index=14&type=section&id=Contingent%20Liabilities) The Group has contingent liabilities related to two warehouses in Mainland China that may face demolition orders and fines of up to approximately HK$1.4 million - The Group failed to obtain property ownership certificates for two warehouses in Mainland China and may face demolition orders and fines of up to approximately **HK$1.4 million**[64](index=64&type=chunk)[68](index=68&type=chunk)[164](index=164&type=chunk)[165](index=165&type=chunk) - The Board believes the possibility of penalties being imposed is remote and the cost of demolition would not be material, thus no provision has been made[164](index=164&type=chunk)[165](index=165&type=chunk) [Litigation Matter](index=14&type=section&id=Litigation%20Matter) The Group won a first-instance and an appeal judgment in a trademark infringement and unfair competition lawsuit in China, with the judgment pending formal service - The Group initiated legal proceedings in China against two parties for trademark infringement and unfair competition in April 2020, winning the first-instance judgment in July 2022 and the appeal on **March 20, 2025**[65](index=65&type=chunk)[69](index=69&type=chunk) - As of the date of this interim report, the judgment is pending formal service to one of the parties[65](index=65&type=chunk)[69](index=69&type=chunk) [Gearing Ratio](index=14&type=section&id=Gearing%20Ratio) The Group's gearing ratio remained stable at 0.8% as of June 30, 2025 Gearing Ratio | Indicator | Jun 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Gearing Ratio | 0.8% | 0.8% | [Foreign Currency Risk](index=15&type=section&id=Foreign%20Currency%20Risk) The Group is exposed to transactional currency risk, primarily from USD-denominated purchases, while sales are mainly in HKD and RMB - The Group is exposed to transactional currency risk arising from sales and purchases by operating units in currencies other than their functional currencies[71](index=71&type=chunk)[74](index=74&type=chunk) - Most foreign currency purchase transactions are denominated in **USD**, while sales are mainly denominated in **HKD** and **RMB**[71](index=71&type=chunk)[74](index=74&type=chunk) - Management closely monitors foreign exchange risk and will consider hedging policies for significant exposures[71](index=71&type=chunk)[74](index=74&type=chunk) [Interest Rate Risk](index=15&type=section&id=Interest%20Rate%20Risk) The Group's interest rate risk arises mainly from floating-rate bank borrowings, with management continuously monitoring its exposure - The Group's exposure to changes in market interest rates relates primarily to its floating-rate bank borrowings[72](index=72&type=chunk)[75](index=75&type=chunk) - The Group monitors its interest rate exposure and will consider hedging significant interest rate risks when necessary[72](index=72&type=chunk)[75](index=75&type=chunk) [Credit Risk](index=15&type=section&id=Credit%20Risk) The Group manages credit risk by trading only with reputable third parties and maintaining a credit monitoring team, resulting in no significant bad debt risk - The Group trades only with recognized and creditworthy third parties and has a credit monitoring team to mitigate credit risk[73](index=73&type=chunk)[76](index=76&type=chunk) - Receivable balances are monitored on an ongoing basis, and the Group does not face any significant bad debt risk[73](index=73&type=chunk)[76](index=76&type=chunk) - Credit risk on other financial assets, including cash, prepayments, deposits, and other receivables, arises from counterparty default[77](index=77&type=chunk) [Liquidity Risk](index=16&type=section&id=Liquidity%20Risk) The Group manages liquidity risk through a cash pooling system to ensure sufficient funds are available to meet both short-term and long-term needs - The Group's objective is to ensure sufficient funds are available to meet its short-term and long-term liquidity needs[78](index=78&type=chunk)[81](index=81&type=chunk) - The Group utilizes a cash pooling system to internally allocate surplus liquidity through inter-company accounts[78](index=78&type=chunk)[81](index=81&type=chunk) [HUMAN RESOURCES](index=16&type=section&id=HUMAN%20RESOURCES) As of June 30, 2025, the Group employed 199 staff in Hong Kong and 174 in Mainland China, offering diverse training and incentive schemes Employee Numbers | Region | Jun 30, 2025 (Number of employees) | Dec 31, 2024 (Number of employees) | | :--- | :--- | :--- | | Hong Kong | 199 | 198 | | Mainland China | 174 | 176 | - Remuneration packages are determined with reference to qualifications, experience, performance, and market terms, with a share option scheme to incentivize key employees[79](index=79&type=chunk)[82](index=82&type=chunk) - The Group provides various training programs covering operational skills (e.g, occupational safety, machine control) and professional knowledge (e.g, management systems, business knowledge)[80](index=80&type=chunk)[82](index=82&type=chunk) [Independent Review Report](index=17&type=section&id=Independent%20Review%20Report) [INTRODUCTION](index=17&type=section&id=INTRODUCTION) Ernst & Young has reviewed the interim financial information of Tsit Wing International Holdings Limited for the six months ended June 30, 2025 - **Ernst & Young** has reviewed the interim financial information of Tsit Wing International Holdings Limited and its subsidiaries for the six months ended June 30, 2025[84](index=84&type=chunk)[85](index=85&type=chunk) - The company's directors are responsible for the preparation and presentation of the interim financial information in accordance with Hong Kong Accounting Standard 34[84](index=84&type=chunk)[85](index=85&type=chunk) [SCOPE OF REVIEW](index=18&type=section&id=SCOPE%20OF%20REVIEW) The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is substantially less in scope than an audit - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity"[87](index=87&type=chunk)[89](index=89&type=chunk) - A review's scope is substantially less than an audit's, providing no assurance that all significant matters would be identified, and thus no audit opinion is expressed[87](index=87&type=chunk)[89](index=89&type=chunk) [CONCLUSION](index=18&type=section&id=CONCLUSION) Based on the review, nothing has come to the auditor's attention that causes them to believe the interim financial information is not prepared in all material respects in accordance with HKAS 34 - Based on the review, nothing has come to the auditor's attention that causes them to believe that the interim financial information is not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34[88](index=88&type=chunk)[90](index=90&type=chunk) [Condensed Consolidated Statement of Profit or Loss](index=19&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) [Condensed Consolidated Statement of Profit or Loss](index=19&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) The statement shows an 8.9% revenue increase but a 31.0% profit decrease for the six months ended June 30, 2025, driven by higher costs and lower other income Key Data from Condensed Consolidated Statement of Profit or Loss | Indicator | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | YoY Change (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 380,427 | 349,437 | 30,990 | 8.9% | | Cost of Sales | (264,485) | (224,629) | (39,856) | 17.7% | | Gross Profit | 115,942 | 124,808 | (8,866) | -7.1% | | Other Income and Gains, Net | 2,402 | 15,161 | (12,759) | -84.2% | | Profit Before Tax | 29,786 | 45,124 | (15,338) | -34.0% | | Taxation | (4,924) | (8,978) | 4,054 | -45.2% | | Profit for the Period | 24,862 | 36,146 | (11,284) | -31.2% | | Earnings Per Share Attributable to Owners of the Parent (HK cents) | 3.45 | 5.02 | -1.57 | -31.3% | [Condensed Consolidated Statement of Comprehensive Income](index=20&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) [Condensed Consolidated Statement of Comprehensive Income](index=20&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) The statement shows total comprehensive income for the period was HK$28.4 million, comprising profit of HK$24.9 million and an exchange difference of HK$3.5 million Key Data from Condensed Consolidated Statement of Comprehensive Income | Indicator | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | YoY Change (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Profit for the Period | 24,862 | 36,146 | (11,284) | -31.2% | | Exchange Differences on Translation of Foreign Operations | 3,500 | (3,025) | 6,525 | N/A | | Total Comprehensive Income for the Period | 28,362 | 33,121 | (4,759) | -14.4% | [Condensed Consolidated Statement of Financial Position](index=21&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) [Condensed Consolidated Statement of Financial Position](index=21&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) The statement shows a slight increase in total assets less current liabilities and growth in net current assets, mainly driven by higher inventories Key Data from Condensed Consolidated Statement of Financial Position | Indicator | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Non-current Assets | 223,764 | 227,457 | (3,693) | -1.6% | | Total Current Assets | 481,915 | 452,714 | 29,201 | 6.5% | | Total Current Liabilities | 161,060 | 144,706 | 16,354 | 11.3% | | Net Current Assets | 320,855 | 308,008 | 12,847 | 4.2% | | Total Non-current Liabilities | 22,164 | 25,804 | (3,640) | -14.1% | | Net Assets | 522,455 | 509,661 | 12,794 | 2.5% | | Total Equity | 522,455 | 509,661 | 12,794 | 2.5% | [Condensed Consolidated Statement of Changes in Equity](index=23&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) [Condensed Consolidated Statement of Changes in Equity](index=23&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) The statement shows that total equity increased to HK$522.5 million, reflecting total comprehensive income of HK$28.4 million and dividend payments of HK$15.6 million Key Data from Condensed Consolidated Statement of Changes in Equity | Indicator | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Total Equity at Beginning of Period (Jan 1) | 509,661 | 590,436 | | Profit for the Period | 24,862 | 36,146 | | Other Comprehensive Income/(Loss) for the Period | 3,500 | (3,025) | | Total Comprehensive Income for the Period | 28,362 | 33,121 | | Dividends | (15,568) | (115,966) | | Total Equity at End of Period (Jun 30) | 522,455 | 507,591 | [Condensed Consolidated Statement of Cash Flows](index=25&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) [Condensed Consolidated Statement of Cash Flows](index=25&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) The statement shows a significant decrease in net cash from operating activities, leading to a net decrease in cash and cash equivalents of HK$24.3 million Key Data from Condensed Consolidated Statement of Cash Flows | Indicator | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | YoY Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Net Cash Flows from Operating Activities | 9,077 | 63,845 | (54,768) | | Net Cash Flows (Used in)/from Investing Activities | (11,402) | 6,223 | (17,625) | | Net Cash Flows Used in Financing Activities | (21,998) | (125,345) | 103,347 | | Net Decrease in Cash and Cash Equivalents | (24,323) | (55,277) | 30,954 | | Cash and Cash Equivalents at End of Period | 146,562 | 197,781 | (51,219) | [Notes to the Condensed Consolidated Financial Statements](index=28&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [1. CORPORATE AND GROUP INFORMATION](index=28&type=section&id=1.%20CORPORATE%20AND%20GROUP%20INFORMATION) The Group is an investment holding company whose subsidiaries primarily distribute coffee, tea, frozen foods, and provide related machine solutions - The Company is an investment holding company, and its subsidiaries are principally engaged in the processing and distribution of coffee, tea and related complementary products/services, distribution of frozen food products, and the sale and provision of coffee and tea machine solutions[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) [2.1 BASIS OF PREPARATION](index=29&type=section&id=2.1%20BASIS%20OF%20PREPARATION) The interim financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting" under the historical cost convention, except for derivative financial instruments - The financial statements have been prepared in accordance with Hong Kong Accounting Standard (HKAS) 34 "Interim Financial Reporting" issued by the HKICPA[106](index=106&type=chunk)[108](index=108&type=chunk) - The statements are prepared under the historical cost convention, except for derivative financial instruments which are measured at fair value[107](index=107&type=chunk)[108](index=108&type=chunk) [2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES](index=30&type=section&id=2.2%20CHANGES%20IN%20ACCOUNTING%20POLICIES%20AND%20DISCLOSURES) The Group adopted the amendments to HKAS 21 "Lack of Exchangeability" for the first time, which had no material impact on the interim financial information - The Group adopted the amendments to HKAS 21 "Lack of Exchangeability" for the first time in the current period[109](index=109&type=chunk)[110](index=110&type=chunk)[111](index=111&type=chunk)[112](index=112&type=chunk) - The amendments had no impact on the unaudited interim condensed consolidated financial information as the currencies used in the Group's transactions and the functional currencies of its entities are exchangeable[110](index=110&type=chunk)[112](index=112&type=chunk) [3. OPERATING SEGMENT INFORMATION](index=31&type=section&id=3.%20OPERATING%20SEGMENT%20INFORMATION) The Group's revenue is primarily generated from Hong Kong and Mainland China, with Hong Kong being the largest contributor Revenue from External Customers by Geographical Location | Region | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | YoY Change (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Hong Kong | 264,401 | 244,279 | 20,122 | 8.2% | | Mainland China | 109,559 | 99,187 | 10,372 | 10.5% | | Others | 6,467 | 5,971 | 496 | 8.3% | | Total | 380,427 | 349,437 | 30,990 | 8.9% | Non-current Assets by Geographical Location (Excluding Deferred Tax Assets and Financial Assets) | Region | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Hong Kong | 142,187 | 143,649 | (1,462) | -1.0% | | Mainland China | 77,080 | 79,834 | (2,754) | -3.5% | | Total | 219,267 | 223,483 | (4,216) | -1.9% | [4. REVENUE AND OTHER INCOME AND GAINS, NET](index=33&type=section&id=4.%20REVENUE%20AND%20OTHER%20INCOME%20AND%20GAINS%2C%20NET) Revenue was mainly driven by a 9.3% increase in sales of coffee, tea, and related products, while other income and gains, net, declined sharply Revenue from Contracts with Customers by Goods or Service Type | Goods or Service Type | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | YoY Change (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Sales of coffee, tea and other related complementary products/services | 365,574 | 334,534 | 31,040 | 9.3% | | Sales of frozen food products | 3,339 | 4,103 | (764) | -18.6% | | Revenue from provision of coffee and tea machine solutions services | 11,514 | 10,800 | 714 | 6.6% | | Total | 380,427 | 349,437 | 30,990 | 8.9% | Details of Other Income and Gains, Net | Item | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | YoY Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Bank interest income | 1,994 | 2,563 | (569) | | Net exchange differences | 210 | — | 210 | | Gain on disposal of assets classified as held for sale and items of property, plant and equipment, net | — | 12,273 | (12,273) | | Gross rental income from operating leases of investment properties | 39 | — | 39 | | Others | 159 | 325 | (166) | | Total | 2,402 | 15,161 | (12,759) | - The gain on disposal of assets classified as held for sale in H1 2024 was **HK$12,447 thousand**, with no such gain in the current period[123](index=123&type=chunk) [5. FINANCE COSTS](index=35&type=section&id=5.%20FINANCE%20COSTS) Finance costs for the six months ended June 30, 2025, were HK$0.8 million, primarily consisting of interest on bank borrowings and lease liabilities Details of Finance Costs | Item | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Interest on bank borrowings | 65 | 154 | | Interest on lease liabilities | 771 | 669 | | Total | 836 | 823 | [6. PROFIT BEFORE TAX](index=36&type=section&id=6.%20PROFIT%20BEFORE%20TAX) Profit before tax was HK$29.8 million, a decrease of 34.0% from the prior period, with details of key expenses like cost of inventories sold and depreciation provided Income/(Expenses) Affecting Profit Before Tax | Item | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Cost of inventories sold | 243,327 | 205,311 | | Total depreciation | 18,323 | 19,331 | | Total employee benefit expense | 58,054 | 60,728 | | Loss/(gain) on disposal of assets classified as held for sale and items of property, plant and equipment, net | 72 | (12,273) | | Net loss on fair value change of derivative financial instruments | 1,409 | 431 | - Cost of sales for the six months ended June 30, 2025, amounted to **HK$264,485 thousand**, including cost of inventories sold of **HK$243,327 thousand**, depreciation of **HK$8,239 thousand**, and employee benefit expense of **HK$7,269 thousand**[130](index=130&type=chunk) [7. TAXATION](index=38&type=section&id=7.%20TAXATION) Total tax expense for the period was HK$4.9 million, a significant decrease of 45.6% due to lower pre-tax profit and the absence of withholding tax on dividends from Mainland China - The profits tax rate is **16.5%** in Hong Kong (with a two-tiered rate of 8.25% for qualifying entities) and **25%** for assessable profits in Mainland China[133](index=133&type=chunk)[134](index=134&type=chunk) Details of Tax Expense | Item | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current – Hong Kong | 1,579 | 4,093 | | Current – Mainland China | 2,054 | 4,916 | | Deferred | 1,291 | (31) | | Total tax charge for the period | 4,924 | 8,978 | - In H1 2024, a **5% withholding income tax of HK$2,964 thousand** was levied on dividend distributions from subsidiaries in Mainland China; there was no such tax in H1 2025[136](index=136&type=chunk) [8. DIVIDENDS](index=40&type=section&id=8.%20DIVIDENDS) The Board has declared an interim dividend of 1.90 HK cents per share for the six months ended June 30, 2025, down from 2.76 HK cents in the prior period Dividends Recognized and Declared | Dividend Type | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | 2024 Final Dividend (2.16 HK cents per share) | 15,568 | — | | 2023 Final Dividend (2.22 HK cents per share) | — | 16,000 | | Special Dividend (13.87 HK cents per share) | — | 99,966 | | Total dividends recognized as distribution during the period | 15,568 | 115,966 | | Interim dividend declared after the reporting period (1.90 vs 2.76 HK cents per share) | 13,694 | 19,892 | [9. EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE PARENT](index=41&type=section&id=9.%20EARNINGS%20PER%20SHARE%20ATTRIBUTABLE%20TO%20ORDINARY%20EQUITY%20HOLDERS%20OF%20THE%20PARENT) Basic and diluted earnings per share were 3.45 HK cents for the six months ended June 30, 2025, down from 5.02 HK cents in the prior period Basis for Earnings Per Share Calculation | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit attributable to ordinary equity holders of the parent (HK$ thousand) | 24,862 | 36,146 | | Weighted average number of ordinary shares in issue (thousand shares) | 720,732 | 720,732 | | Basic and diluted earnings per share (HK cents) | 3.45 | 5.02 | - Basic and diluted earnings per share were identical for the six months ended June 30, 2025 and 2024, as there were no outstanding share options or other dilutive instruments[140](index=140&type=chunk)[142](index=142&type=chunk) [10. PROPERTY, PLANT AND EQUIPMENT AND INVESTMENT PROPERTIES](index=43&type=section&id=10.%20PROPERTY%2C%20PLANT%20AND%20EQUIPMENT%20AND%20INVESTMENT%20PROPERTIES) The Group added HK$37.6 million in property, plant and equipment and transferred an owner-occupied building with a net book value of HK$1.2 million to investment properties Additions to Property, Plant and Equipment | Item | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Additions to other property, plant and equipment | 37,575 | 13,557 | | Additions to right-of-use assets | — | 20,057 | - During the six months ended June 30, 2025, an owner-occupied building with a net book value of **HK$1,241 thousand** was transferred to investment properties[146](index=146&type=chunk)[147](index=147&type=chunk) - The Group's investment properties comprise three units of a commercial property in Mainland China, which are carried at cost less accumulated depreciation and impairment losses[146](index=146&type=chunk)[147](index=147&type=chunk)[148](index=148&type=chunk)[149](index=149&type=chunk) [11. INVENTORIES](index=44&type=section&id=11.%20INVENTORIES) Total inventories increased to HK$201.3 million as of June 30, 2025, primarily driven by a significant rise in raw materials Details of Inventories | Item | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Raw materials | 142,816 | 106,966 | 35,850 | 33.5% | | Work in progress | 338 | 340 | (2) | -0.6% | | Finished goods | 58,135 | 56,954 | 1,181 | 2.1% | | Total | 201,289 | 164,260 | 37,029 | 22.5% | [12. TRADE RECEIVABLES](index=45&type=section&id=12.%20TRADE%20RECEIVABLES) Net trade receivables stood at HK$105.2 million as of June 30, 2025, with credit terms generally ranging from 30 to 120 days Net Trade Receivables | Indicator | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net Trade Receivables | 105,184 | 100,707 | 4,477 | 4.4% | - The Group's trading terms with its customers are mainly on credit, with a credit period generally ranging from **30 to 120 days**, and a credit monitoring team is in place to mitigate credit risk[153](index=153&type=chunk)[154](index=154&type=chunk) Ageing Analysis of Trade Receivables (Net of Loss Allowance) | Ageing | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Within 30 days | 96,256 | 95,102 | | 31 to 60 days | 5,905 | 3,716 | | 61 to 90 days | 2,404 | 1,425 | | 91 to 120 days | 307 | 250 | | 121 to 180 days | 246 | 96 | | Over 180 days | 66 | 118 | | Total | 105,184 | 100,707 | [13. TRADE PAYABLES](index=47&type=section&id=13.%20TRADE%20PAYABLES) Total trade payables increased significantly to HK$96.0 million as of June 30, 2025, and are typically settled within 30 to 60 days Total Trade Payables | Indicator | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Trade Payables | 95,985 | 77,250 | 18,735 | 24.2% | - Trade payables are non-interest-bearing and are normally settled within **30 to 60 days**[159](index=159&type=chunk) Ageing Analysis of Trade Payables | Ageing | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Within 1 month | 94,439 | 75,406 | | 1 to 2 months | 1,479 | 849 | | 2 to 3 months | 21 | 13 | | Over 3 months | 46 | 982 | | Total | 95,985 | 77,250 | [14. INTEREST-BEARING BANK BORROWINGS](index=48&type=section&id=14.%20INTEREST-BEARING%20BANK%20BORROWINGS) As of June 30, 2025, the Group's interest-bearing bank borrowings amounted to HK$4.3 million, all of which were unsecured trust receipt loans Interest-bearing Bank Borrowings | Indicator | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Trust receipt loans – unsecured | 4,307 | 4,013 | 294 | [15. ISSUED CAPITAL](index=48&type=section&id=15.%20ISSUED%20CAPITAL) As of June 30, 2025, the company's issued and fully paid-up share capital was HK$72.1 million, comprising 720,731,512 ordinary shares Issued Capital | Indicator | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Authorized Share Capital | 200,000 | 200,000 | | Issued and Fully Paid-up Share Capital | 72,073 | 72,073 | - The issued and fully paid-up share capital consists of **720,731,512 ordinary shares** of HK$0.10 each[163](index=163&type=chunk) [16. CONTINGENT LIABILITIES](index=49&type=section&id=16.%20CONTINGENT%20LIABILITIES) The Group has contingent liabilities related to two warehouses in Mainland China that may face demolition orders and fines of up to approximately HK$1.4 million - The Group failed to obtain property ownership certificates for two warehouses in Mainland China and may face demolition orders and fines of up to approximately **HK$1.4 million**[164](index=164&type=chunk)[165](index=165&type=chunk) - The Board believes the possibility of penalties being imposed is remote and the cost of demolition would not be material, thus no provision has been made[164](index=164&type=chunk)[165](index=165&type=chunk) [17. COMMITMENTS](index=50&type=section&id=17.%20COMMITMENTS) As of June 30, 2025, the Group's capital commitments amounted to HK$3.9 million, primarily related to property, plant and equipment Contractual Commitments | Item | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Property, plant and equipment | 3,861 | 5,008 | (1,147) | [18. RELATED PARTY TRANSACTIONS](index=51&type=section&id=18.%20RELATED%20PARTY%20TRANSACTIONS) The Group engaged in several transactions with companies related to its substantial shareholders, including procurement, logistics services, and OEM processing income Details of Related Party Transactions | Transaction Type | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Purchase of goods through a supply chain service provider | — | 9,960 | | Purchase of goods through a distributor | 823 | 1,038 | | Cost of warehousing and logistics services | 564 | 667 | | OEM processing income | 1,731 | 662 | - Related party transactions involved associates of a substantial shareholder, including a supply chain service provider, a distributor, a warehousing and logistics provider, and a coffee and tea producer[171](index=171&type=chunk)[172](index=172&type=chunk) Compensation of Key Management Personnel | Item | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | | :--- | :--- | :--- | | Short term employee benefits | 8,253 | 7,803 | | Pension scheme contributions | 481 | 455 | | Total | 8,734 | 8,258 | [19. FAIR VALUES AND FAIR VALUE HIERARCHY OF FINANCIAL INSTRUMENTS](index=54&type=section&id=19.%20FAIR%20VALUES%20AND%20FAIR%20VALUE%20HIERARCHY%20OF%20FINANCIAL%20INSTRUMENTS) Management assesses that the fair values of most financial instruments approximate their carrying amounts due to their short-term nature - Management has assessed that the fair values of most financial instruments, such as trade receivables, cash, trade payables, and bank borrowings, reasonably approximate their carrying amounts due to their short maturities or insignificant discounting impact[175](index=175&type=chunk)[177](index=177&type=chunk) - Derivative financial instruments, including foreign currency swaps, are measured using valuation techniques similar to forward pricing models, and their carrying amounts equal their fair values[178](index=178&type=chunk)[180](index=180&type=chunk) (Liabilities)/Assets Measured at Fair Value | Item | Jun 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Derivative financial instruments | (561) | 96 | - During the six months ended June 30, 2025, there were no transfers of fair value measurements between Level 1 and Level 2 and no transfers into or out of Level 3 for both financial assets and financial liabilities[183](index=183&type=chunk)[185](index=185&type=chunk) [20. APPROVAL OF THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS](index=56&type=section&id=20.%20APPROVAL%20OF%20THE%20UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) The unaudited interim condensed consolidated financial statements were approved by the Board of Directors on August 14, 2025 - The unaudited interim condensed consolidated financial statements were approved by the Board of Directors on **August 14, 2025**[184](index=184&type=chunk)[186](index=186&type=chunk) [Other Information](index=57&type=section&id=Other%20Information) [INTERIM DIVIDEND AND CLOSURE OF REGISTER OF MEMBERS](index=57&type=section&id=INTERIM%20DIVIDEND%20AND%20CLOSURE%20OF%20REGISTER%20OF%20MEMBERS) The Board declared an interim dividend of 1.90 HK cents per share, payable on September 12, 2025, with the register of members closing on August 29, 2025 - The Board has resolved to declare an interim dividend of **1.90 HK cents per share** for the six months ended June 30, 2025 (H1 2024: 2.76 HK cents)[188](index=188&type=chunk)[190](index=190&type=chunk) - The dividend will be paid on **September 12, 2025**, to shareholders on the register of members as of August 29, 2025[188](index=188&type=chunk)[190](index=190&type=chunk) - To determine entitlement to the dividend, the register of members will be closed on **August 29, 2025**[189](index=189&type=chunk)[190](index=190&type=chunk) [AUDIT COMMITTEE](index=58&type=section&id=AUDIT%20COMMITTEE) The Audit Committee, comprising three independent non-executive directors, has reviewed the Group's unaudited interim financial statements for H1 2025 - The Audit Committee, comprising three independent non-executive directors, has reviewed the accounting policies and practices adopted by the Company and discussed auditing, internal control, and financial reporting matters[192](index=192&type=chunk)[194](index=194&type=chunk) - The Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025, have been reviewed by the Audit Committee[192](index=192&type=chunk)[194](index=194&type=chunk) - The Group's external auditor, **Ernst & Young**, has conducted an independent review of the interim condensed consolidated financial statements[193](index=193&type=chunk)[195](index=195&type=chunk) [PURCHASE, SALE OR REDEMPTION OF THE COMPANY'S LISTED SECURITIES](index=59&type=section&id=PURCHASE%2C%20SALE%20OR%20REDEMPTION%20OF%20THE%20COMPANY'S%20LISTED%20SECURITIES) Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025 - During the six months ended June 30, 2025, neither the Company nor any of its subsidiaries had purchased, sold or redeemed any of the Company's listed securities[197](index=197&type=chunk)[200](index=200&type=chunk) [CONTROLLING SHAREHOLDERS' INTEREST IN COMPETING BUSINESS](index=59&type=section&id=CONTROLLING%20SHAREHOLDERS'%20INTEREST%20IN%20COMPETING%20BUSINESS) The Directors are not aware of any business or interest of the controlling shareholders that competes or is likely to compete with the Group's business - During the six months ended June 30, 2025, the Directors were not aware of any business or interest of the controlling shareholders and their respective associates that competes or is likely to compete with the business of the Group, or any other conflict of interest[198](index=198&type=chunk)[201](index=201&type=chunk) [DIRECTORS' SECURITIES TRANSACTIONS](index=59&type=section&id=DIRECTORS'%20SECURITIES%20TRANSACTIONS) The Company has adopted a code for securities dealings, and all Directors have confirmed their compliance with the required standards for H1 2025 - The Company has adopted its code for securities dealings, and all Directors have confirmed that they have complied with the required standards set out in the code for the six months ended June 30, 2025[199](index=199&type=chunk)[202](index=202&type=chunk) [DIRECTORS' INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES](index=60&type=section&id=DIRECTORS'%20INTERESTS%20AND%20SHORT%20POSITIONS%20IN%20SHARES%20AND%20UNDERLYING%20SHARES) As of June 30, 2025, executive directors held long positions in the Company's shares, with Mr Wong Tat Tong deemed to have a 71.41% interest Executive Directors' Interests in Shares of the Company (Long Position) | Name of Executive Director | Nature of Interest | Number of Shares Held | Approximate Percentage of Shareholding (Jun 30, 2025) | | :--- | :--- | :--- | :--- | | Mr Wong Tat Tong | Interest of controlled corporation; Interest in a concert party agreement under section 317 | 514,667,312 | 71.41% | | Ms Fan Yee Man | Beneficial owner | 918,000 | 0.13% | | Mr Kam Chun Pong | Beneficial owner | 184,000 | 0.03% | - Mr Wong Tat Tong is deemed to be interested in **514,667,312 shares**, including through his controlled corporation Hero Asia and an agreement with Dah Chong Hong Holdings Limited[210](index=210&type=chunk) - As of June 30, 2025, no Director of the Company held any short positions in the shares and underlying shares of the Company[210](index=210&type=chunk) Mr Wong Tat Tong's Long Position in Shares of Associated Corporation | Name of Director | Nature of Interest | Name of Associated Corporation | Number of Ordinary Shares Held | Approximate Percentage of Shareholding (Jun 30, 2025) | | :--- | :--- | :--- | :--- | :--- | | Mr Wong | Beneficial owner | Hero Asia | 100 | 100% | [SUBSTANTIAL SHAREHOLDERS' INTERESTS IN SHARES AND UNDERLYING SHARES](index=64&type=section&id=SUBSTANTIAL%20SHAREHOLDERS'%20INTERESTS%20IN%20SHARES%20AND%20UNDERLYING%20SHARES) As of June 30, 2025, Hero Asia, Dah Chong Hong, CITIC Limited, and CITIC Group Corporation were all deemed to have a 71.41% interest in the Company Substantial Shareholders' Interests in Shares and Underlying Shares (Long Position) | Name of Shareholder | Nature of Interest | Number of Ordinary Shares (Long Position) | Approximate Percentage of Total Issued Shares (Jun 30, 2025) | | :--- | :--- | :--- | :--- | | Hero Asia | Beneficial owner; Interest in a concert party agreement under section 317 | 514,667,312 | 71.41% | | Dah Chong Hong Holdings Limited | Beneficial owner; Interest in a concert party agreement under section 317 | 514,667,312 | 71.41% | | CITIC Limited | Interest of controlled corporation; Interest in a concert party agreement under section 317 | 514,667,312 | 71.41% | | CITIC Group Corporation | Interest of controlled corporation; Interest in a concert party agreement under section 317 | 514,667,312 | 71.41% | - Hero Asia and Dah Chong Hong are parties to an agreement to which section 317(1) of the SFO applies, and are therefore each deemed to be interested in the other's shares[219](index=219&type=chunk) - CITIC Limited is an indirect wholly-owned subsidiary of Dah Chong Hong, and CITIC Group Corporation is an indirect non-wholly-owned subsidiary of CITIC Limited, thus both are deemed to be interested in the relevant shares[219](index=219&type=chunk) [PUBLIC FLOAT](index=66&type=section&id=PUBLIC%20FLOAT) As of the date of the interim report, the Company has maintained a sufficient public float as required by the Listing Rules - As of the date of this interim report, the Company has maintained a sufficient public float (i.e, at least 25% of the issued shares are held by the public) in accordance with the Listing Rules[221](index=221&type=chunk)[224](index=224&type=chunk) [EVENTS AFTER THE REPORTING PERIOD](index=66&type=section&id=EVENTS%20AFTER%20THE%20REPORTING%20PERIOD) The Directors are not aware of any significant events after the reporting period that would require disclosure - The Directors are not aware of any significant event requiring disclosure that has taken place subsequent to June 30, 2025 and up to the date of this interim report[222](index=222&type=chunk)[225](index=225&type=chunk) [SHARE OPTION SCHEMES](index=67&type=section&id=SHARE%20OPTION%20SCHEMES) The Company has a Pre-IPO Share Option Scheme and a Share Option Scheme, with no options granted under the latter since its adoption - The Company has a Pre-IPO Share Option Scheme and a Share Option Scheme to encourage and reward eligible participants who have contributed to the success of the Group's operations[227](index=227&type=chunk)[230](index=230&type=chunk) - The Share Option Scheme was approved and adopted on **December 15, 2017**, and will be valid for a period of 10 years from the Listing Date[228](index=228&type=chunk)[231](index=231&type=chunk) - As of June 30, 2025, the total number of shares available for issue under the Share Option Scheme was **72,397,931**[239](index=239&type=chunk)[242](index=242&type=chunk) - **No options have been granted** or agreed to be granted under the Share Option Scheme since its adoption[241](index=241&type=chunk)[242](index=242&type=chunk) - All options under the Pre-IPO Share Option Scheme were forfeited or lapsed by **May 10, 2021**[246](index=246&type=chunk)[249](index=249&type=chunk) [CHANGES IN INFORMATION OF DIRECTORS](index=70&type=section&id=CHANGES%20IN%20INFORMATION%20OF%20DIRECTORS) During the period, Ms Yeung Po Yee, Pauline and Mr Ho Hung Wai, William were appointed as non-executive directors, while Mr Li Te Hua and Mr Timothy John Collins resigned - Ms Yeung Po Yee, Pauline and Mr Ho Hung Wai, William were appointed as non-executive Directors of the Company, effective from **June 12, 2025**[247](index=247&type=chunk)[250](index=250&type=chunk) - Mr Li Te Hua and Mr Timothy John Collins resigned as non-executive Directors, effective from **April 1, 2025**, and **May 10, 2025**, respectively[252](index=252&type=chunk)[256](index=256&type=chunk) [CORPORATE GOVERNANCE PRACTICES](index=71&type=section&id=CORPORATE%20GOVERNANCE%20PRACTICES) The Company has complied with the Corporate Governance Code, except for the deviation from code provision C.2.1 regarding the separation of Chairman and CEO roles - The Company has complied with the code provisions set out in the Corporate Governance Code, except for the deviation from code provision C.2.1 concerning the roles of Chairman and Chief Executive Officer[254](index=254&type=chunk)[257](index=257&type=chunk) - **Mr Wong Tat Tong** currently serves as both the Chairman of the Board and the Chief Executive Officer, which the Board believes is beneficial for executing business strategies and enhancing operational efficiency[255](index=255&type=chunk)[257](index=257&type=chunk) - The Board, which includes three independent non-executive directors, believes that a balance of power, authority, accountability, and independent decision-making is maintained under the current arrangement[258](index=258&type=chunk)[260](index=260&type=chunk) [PUBLICATION OF THE INTERIM REPORT](index=72&type=section&id=PUBLICATION%20OF%20THE%20INTERIM%20REPORT) This interim report is available on the Company's website (www.twcoffee.com) and the designated website of the Stock Exchange (www.hkexnews.hk) - This interim report is published on the Company's website (www.twcoffee.com) and the designated website of the Stock Exchange (www.hkexnews.hk)[259](index=259&type=chunk)[261](index=261&type=chunk) [APPRECIATION](index=73&type=section&id=APPRECIATION) The Board extends its sincere gratitude to its shareholders, customers, auditors, business partners, associates, management team, and employees - The Board would like to express its sincere gratitude to the shareholders, customers, auditors, business partners and associates for their continued support, and to the management team and employees of the Group for their hard work and dedication[263](index=263&type=chunk)[264](index=264&type=chunk)

德翔海運有限公司 T.S. Lines Limited 股份代號：2510 2025 中期報告 目錄 2 公司資料 3 管理層討論與分析 10 企業管治及其他資料 15 獨立核數師對未經審核中期財務報告的審閱報告 16 綜合損益及其他全面收入表 17 綜合財務狀況表 19 綜合權益變動表 20 簡明綜合現金流量表 21 未經審核中期財務報告附註 33 詞彙 德翔海運有限公司 2025年中期報告 2 公司資料 董事會 執行董事 陳德勝先生 （主席兼首席執行官） 陳劭翔先生 （副主席） 莊壯麗女士 涂鴻麟先生 周航敏先生 獨立非執行董事 吳榮貴先生 張山輝先生 楊豊彥先生 審核委員會 張山輝先生 （主席） 吳榮貴先生 楊豊彥先生 提名委員會 陳德勝先生 （主席） 莊壯麗女士 （於2025年8月25日獲委任） 吳榮貴先生 張山輝先生 楊豊彥先生 薪酬委員會 楊豊彥先生 （主席） 吳榮貴先生 張山輝先生 授權代表 周航敏先生 陳仲戟先生 公司秘書 陳仲戟先生 有關香港法律的法律顧問 安理謝爾曼思特靈律師事務所 香港 中環 交易廣場三座九樓 核數師 畢馬威會計師事務所 執業會計師及根據會計及財務匯報局條例註冊的公眾利益 ...

（於中華人民共和國註冊成立之股份有限公司） （股份代號：8205） 二零二五中期業績報告 * 僅供識別 香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM之定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他在主板 上市的公司帶有較高投資風險。有意投資的人士應了解投資於該等公司的潛在風 險，並應經過審慎周詳的考慮後方作出投資決定。 由於GEM上市公司普遍為中小型公司，在GEM買賣的證券可能會較於主板買賣的 證券承受較大的市場波動風險，同時無法保證在GEM買賣的證券會有高流通量的 市場。 香港交易及結算所有限公司及聯交所對本報告的內容概不負責，對其準確性或完 整性亦不發表任何聲明，並明確表示概不就因本報告全部或任何部分內容而產生 或因依賴該等內容而引致的任何損失承擔任何責任。 本報告乃遵照聯交所《GEM證券上市規則》（「GEM上市規則」）之規定而提供有關上 海交大慧谷信息產業股份有限公司（「本公司」）之資料。本公司各董事（「董事」）願共 同及個別對此負全責。董事經作出一切合理查詢後，確認就彼等所知及所信，本報 告所載資料在各重大方面均屬準確及完整，並無誤導成分，且並無遺漏任何其他事 實，足以令致本報 ...