[Corporate Information](index=3&type=section&id=Corporate%20Information) Provides an overview of the company's governance structure, including its board composition and registered offices [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) Details the composition of the Board of Directors and its committees, ensuring robust corporate governance - Mr. Hong Kun was appointed as an executive director on May 19, 2025[6](index=6&type=chunk) - The Board of Directors has an Audit Committee, Remuneration Committee, and Nomination Committee to strengthen corporate governance[5](index=5&type=chunk)[6](index=6&type=chunk) [Registered and Business Offices](index=4&type=section&id=Registered%20and%20Business%20Offices) Specifies the company's registered office in the Cayman Islands and its main business locations in China and Hong Kong - The company's registered office is in the Cayman Islands, with its principal office in Shantou, Guangdong, China, and its Hong Kong office in Causeway Bay[8](index=8&type=chunk)[10](index=10&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) Analyzes the company's operational and financial performance, strategic initiatives, and future outlook [Business and Financial Review](index=5&type=section&id=Business%20and%20Financial%20Review) Reviews the group's core business activities and financial performance for the period, highlighting revenue growth and gross profit decline - The Group primarily designs, develops, manufactures, and sells high-quality smart car models, smart interactive toys, and traditional toys[11](index=11&type=chunk)[15](index=15&type=chunk) - The Group accelerated expansion into emerging markets to offset shrinking domestic and international orders, driving revenue growth[12](index=12&type=chunk)[16](index=16&type=chunk) - Due to adjustments in business development policies, no revenue was recorded for smart interactive toys and traditional toys in the first half of 2025, and production and sales of traditional toys have been suspended[19](index=19&type=chunk)[20](index=20&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk) - The Group collaborates with well-known brands to leverage their marketing advantages and enhance product market circulation[22](index=22&type=chunk)[25](index=25&type=chunk) Key Financial Indicators (Six Months Ended June 30) | Indicator | 2025 (RMB Million) | 2024 (RMB Million) | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | 68.9 | 50.5 | +36.5% | | Smart Car Model Sales Revenue | 68.9 | 48.5 | +42.1% | | Smart Interactive Toy Revenue | 0 | 0 | - | | Traditional Toy Revenue | 0 | 0 | - | | **Gross Profit** | 3.9 | 8.6 | -54.7% | | **Gross Profit Margin** | 5.7% | 17.0% | -11.3 percentage points | | **Loss for the Period** | (15.0) | (17.6) | -14.8% (Loss narrowed) | | **Selling Expenses** | 0 | 0.007 | -100% | | **Administrative Expenses** | 6.9 | 12.1 | -43.2% | | **Net Impairment Loss on Trade Receivables** | 6.7 | 7.4 | -9.5% | | **Taxation** | 0 | 0 | - | | **Cash and Cash Equivalents** | 46.4 | 10.7 | +333.6% | | **Capital Gearing Ratio** | 46.8% | 44.0% (Dec 31, 2024) | +2.8 percentage points | | **Current Ratio** | 1.4 | 1.4 (Dec 31, 2024) | 0 | | **Quick Ratio** | 1.4 | 1.4 (Dec 31, 2024) | 0 | [Business Review and Outlook](index=10&type=section&id=Business%20Review%20and%20Outlook) Discusses market challenges and the group's strategies for market expansion, cost control, and diversification into new energy sectors - The Group faces weakening consumer demand in European and American toy markets, leading to a decline in traditional toy orders[51](index=51&type=chunk)[54](index=54&type=chunk) - The Group has accelerated expansion into emerging markets to secure new orders, outsourced most orders to reduce fixed costs, and implemented a strategy of cost control, low gross profit, and stable sales[51](index=51&type=chunk)[54](index=54&type=chunk) - The Group will actively expand into high-end, clean energy, and other green-related product and technology industries to enhance competitive advantage and development potential[51](index=51&type=chunk)[54](index=54&type=chunk) [Investments and Capital Assets](index=10&type=section&id=Investments%20and%20Capital%20Assets) Outlines the group's investment activities, including its strategic entry into the new energy sector through acquisitions - For the six months ended June 30, 2025, the Group had no significant investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures[52](index=52&type=chunk)[55](index=55&type=chunk) - The Group has initially ventured into the new energy sector by acquiring a 60% equity interest in Inner Mongolia Paiwei Technology Co., Ltd. (for RMB 1), which primarily engages in the research, development, production, and sales of energy storage molten salt, core raw materials, and integrated thermal energy storage systems[53](index=53&type=chunk)[56](index=56&type=chunk) - The Group also acquired a 51% equity interest in Times Logistics Investment Co., Ltd. (for USD 51), whose indirect wholly-owned subsidiary, Delingha Ainengsen New Energy Technology Co., Ltd., primarily engages in the sales, service, and after-sales support of molten salt materials and thermal storage equipment[57](index=57&type=chunk)[63](index=63&type=chunk) [Financial Resources and Policies](index=11&type=section&id=Financial%20Resources%20and%20Policies) Describes the group's capital structure, liquidity, and financial management policies, including borrowing and foreign exchange risk Capital Structure and Liquidity (As of June 30, 2025) | Indicator | June 30, 2025 (RMB Million) | December 31, 2024 (RMB Million) | Change (%) | | :--- | :--- | :--- | :--- | | Total Borrowings | 128.6 | 125.8 | +2.2% | | Total Equity | 275.0 | 285.9 | -3.8% | | Capital Gearing Ratio | 46.8% | 44.0% | +2.8 percentage points | | Trade Receivables | 253.4 | 301.3 | -15.9% | | Prepayments and Other Receivables | 83.8 | 82.6 | +1.5% | | Trade and Other Payables | 126.9 | 140.0 | -9.4% | | Cash and Cash Equivalents | 46.4 | 10.7 | +333.6% | - The Group's funding sources are primarily cash generated from operating activities and bank borrowings, with its financial position regularly reviewed[69](index=69&type=chunk)[71](index=71&type=chunk) - The directors believe the Group is not exposed to significant foreign exchange risk and currently has no foreign currency hedging policy, nor has it used financial instruments for hedging purposes[70](index=70&type=chunk)[72](index=72&type=chunk) [Events After the Reporting Period](index=13&type=section&id=Events%20After%20the%20Reporting%20Period) Details significant events occurring after the reporting period, specifically a share placing for debt repayment and working capital - On August 29, 2025, the company successfully placed 124,912,800 shares, representing approximately 20.00% of the existing issued share capital[73](index=73&type=chunk)[77](index=77&type=chunk) Use of Proceeds from Placing | Purpose | Amount (HKD Million) | Percentage (%) | | :--- | :--- | :--- | | Repayment of Group Debts | 10.0 | 61.9% | | General Working Capital | 6.1 | 38.1% | | **Total Net Proceeds** | **16.1** | **100%** | [Employees, Remuneration Policies and Pension Schemes](index=13&type=section&id=Employees%20Remuneration%20Policies%20and%20Pension%20Schemes) Provides information on employee headcount, remuneration policies, and participation in pension and social security schemes Employee Headcount Change | Date | Number of Full-time Employees | | :--- | :--- | | June 30, 2025 | 24 | | December 31, 2024 | 32 | - The Group provides remuneration benefits such as salaries, accident insurance, and allowances, with bonuses determined discretionarily based on employee performance and overall group performance[76](index=76&type=chunk)[79](index=79&type=chunk) - The Group participates in China's housing provident fund and social security schemes, while Hong Kong employees participate in the Mandatory Provident Fund Scheme[81](index=81&type=chunk)[82](index=82&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk) [Business Outlook](index=14&type=section&id=Business%20Outlook) Presents the group's strategic priorities for future growth, focusing on market expansion, efficiency, and product diversification - The Group will continue to prioritize and focus on overseas markets while expanding its customer base and remaining vigilant against new epidemics[86](index=86&type=chunk) - The Group will continue to strengthen, expand, and diversify its customer base by focusing on Hong Kong and Chinese export-oriented wholesalers and Chinese retailers[86](index=86&type=chunk) - The Group will improve production efficiency and effectively control costs by outsourcing part of its production processes, and allocate more resources to expand sales in domestic and Asian markets[86](index=86&type=chunk) - The Group will achieve business growth through continuous development of a diversified new product portfolio[86](index=86&type=chunk) [Condensed Consolidated Interim Financial Statements](index=15&type=section&id=Condensed%20Consolidated%20Interim%20Financial%20Statements) Presents the group's interim financial performance and position, including comprehensive income, financial position, equity changes, and cash flows [Condensed Consolidated Interim Statement of Comprehensive Income](index=15&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Comprehensive%20Income) Reports the group's revenue, expenses, and net loss for the period, along with other comprehensive income items Summary of Condensed Consolidated Interim Statement of Comprehensive Income | Indicator | 2025 (RMB Thousand) | 2024 (RMB Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 68,926 | 50,488 | +36.5% | | Cost of Sales | (64,991) | (41,891) | +55.1% | | Gross Profit | 3,935 | 8,597 | -54.2% | | Selling Expenses | 0 | (7) | -100% | | Administrative Expenses | (6,867) | (12,093) | -43.2% | | Net Impairment Loss on Trade Receivables | (6,674) | (7,396) | -9.8% | | Other Income and Other Gains/(Losses) – Net | 633 | (414) | +253.4% | | Operating Loss | (8,973) | (11,313) | -20.7% | | Finance Costs | (6,065) | (6,271) | -3.3% | | Loss Before Tax | (15,038) | (17,584) | -14.5% | | Income Tax | 0 | 0 | - | | Loss for the Period | (15,038) | (17,584) | -14.5% | | Exchange Differences on Translation of Foreign Operations | 4,140 | (7,687) | +153.9% | | Total Comprehensive Loss for the Period | (10,898) | (25,271) | -56.9% | | Basic and Diluted Loss Per Share (RMB Cents) | (2.4) | (2.8) | -14.3% | [Condensed Consolidated Interim Statement of Financial Position](index=17&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Financial%20Position) Details the group's assets, liabilities, and equity as of the reporting date, showing its financial health Summary of Condensed Consolidated Interim Statement of Financial Position | Indicator | June 30, 2025 (RMB Thousand) | December 31, 2024 (RMB Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | **Non-current Assets** | | | | | Property, Plant and Equipment | 152,440 | 159,237 | -4.3% | | Right-of-use Assets | 9,491 | 9,504 | -0.1% | | Prepayments | 9,061 | 9,739 | -7.0% | | **Current Assets** | | | | | Inventories | 18,379 | 19,291 | -4.7% | | Trade Receivables | 253,425 | 301,262 | -15.9% | | Prepayments and Other Receivables | 83,754 | 82,553 | +1.5% | | Cash and Cash Equivalents | 46,422 | 10,705 | +333.6% | | **Current Liabilities** | | | | | Trade and Other Payables | 126,852 | 139,981 | -9.4% | | Bank and Other Borrowings | 128,626 | 125,762 | +2.3% | | **Net Assets** | 274,978 | 285,876 | -3.8% | | **Total Equity** | 274,978 | 285,876 | -3.8% | [Condensed Consolidated Interim Statement of Changes in Equity](index=18&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Changes%20in%20Equity) Illustrates the changes in the group's equity attributable to owners of the company during the reporting period Summary of Condensed Consolidated Interim Statement of Changes in Equity | Indicator | June 30, 2025 (RMB Thousand) | January 1, 2025 (RMB Thousand) | Change (RMB Thousand) | | :--- | :--- | :--- | :--- | | Share Capital | 562 | 562 | 0 | | Reserves | 274,740 | 285,636 | (10,896) | | Equity Attributable to Owners of the Company | 275,302 | 286,198 | (10,896) | | Non-controlling Interests | (324) | (322) | (2) | | **Total Equity** | **274,978** | **285,876** | **(10,898)** | - The total comprehensive loss for the period was RMB 10,898 thousand, primarily comprising a loss for the period of RMB 15,036 thousand and exchange differences on translation of foreign operations of RMB 4,140 thousand[92](index=92&type=chunk) [Condensed Consolidated Interim Statement of Cash Flows](index=19&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Cash%20Flows) Summarizes the cash inflows and outflows from operating, investing, and financing activities for the period Summary of Condensed Consolidated Interim Statement of Cash Flows | Indicator | 2025 (RMB Thousand) | 2024 (RMB Thousand) | Change (RMB Thousand) | | :--- | :--- | :--- | :--- | | Net Cash Generated From/(Used In) Operating Activities | 34,784 | (4,576) | +39,360 | | Net Cash From Investing Activities | 1,700 | 2 | +1,698 | | Net Cash (Used In)/From Financing Activities | (64) | 2,435 | (2,499) | | Net Increase/(Decrease) in Cash and Cash Equivalents | 36,420 | (2,139) | +38,559 | | Cash and Cash Equivalents at Beginning of Period | 10,705 | 48,899 | -38,194 | | Exchange Differences on Cash and Cash Equivalents | (703) | 507 | (1,210) | | **Cash and Cash Equivalents at End of Period** | **46,422** | **47,267** | **(845)** | - Operating cash flow turned positive, indicating an improvement in the company's operational efficiency[93](index=93&type=chunk) [Notes to the Condensed Consolidated Interim Financial Statements](index=20&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Statements) Provides detailed explanations and disclosures supporting the condensed consolidated interim financial statements [General Information and Basis of Preparation](index=20&type=section&id=General%20Information%20and%20Basis%20of%20Preparation) Outlines the company's registration, principal activities, and the accounting standards used for financial statement preparation - The Company was incorporated in the Cayman Islands on October 25, 2019, and its shares were listed on the Main Board of the Hong Kong Stock Exchange on March 18, 2020[94](index=94&type=chunk)[98](index=98&type=chunk) - The Group is principally engaged in the manufacturing and sales of toys[95](index=95&type=chunk)[98](index=98&type=chunk) - The financial statements are prepared in accordance with Hong Kong Accounting Standard 34, with accounting policies consistent with those used in the 2024 annual financial statements[96](index=96&type=chunk)[97](index=97&type=chunk)[99](index=99&type=chunk) [Application of New and Revised HKFRS Accounting Standards](index=21&type=section&id=Application%20of%20New%20and%20Revised%20HKFRS%20Accounting%20Standards) Confirms the adoption of new and revised HKFRS standards and their non-material impact on the financial statements - The Group has adopted all new and revised HKFRS standards, but they have not had a material impact on the financial statements[100](index=100&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk) [Revenue and Segment Information](index=22&type=section&id=Revenue%20and%20Segment%20Information) Presents the group's revenue breakdown by product type and geographical market, identifying car models as the sole product revenue source Revenue by Product Type and Geographical Market (Six Months Ended June 30) | Product Type/Geographical Market | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | **Product Type** | | | | Sales of Car Models | 68,926 | 48,509 | | Purchase and Sales of Raw Materials and Electronic Components | – | 1,979 | | **Total** | **68,926** | **50,488** | | **Geographical Market** | | | | Mainland China | 3,201 | – | | Outside Mainland China | 65,725 | 50,488 | | **Total** | **68,926** | **50,488** | - The Group manages and makes decisions on its business operations as a single operating segment[104](index=104&type=chunk)[105](index=105&type=chunk) - As of June 30, 2025, most of the Group's non-current assets are located in China[106](index=106&type=chunk)[108](index=108&type=chunk) [Finance Costs](index=23&type=section&id=Finance%20Costs) Details the components of the group's finance costs, primarily interest expenses on borrowings and convertible bonds Breakdown of Finance Costs (Six Months Ended June 30) | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | Interest Expense on Bank and Other Borrowings | 3,908 | 6,173 | | Interest Expense on Lease Liabilities | – | 98 | | Interest Expense on Bonds | 86 | – | | Imputed Interest on Convertible Bonds | 2,071 | – | | **Total** | **6,065** | **6,271** | [Income Tax](index=24&type=section&id=Income%20Tax) States that no income tax expense was incurred due to the absence of taxable profit for the reporting period - For the six months ended June 30, 2025, the Group had no taxable profit, resulting in zero income tax expense[115](index=115&type=chunk) [Loss for the Period and Per Share](index=24&type=section&id=Loss%20for%20the%20Period%20and%20Per%20Share) Reports the group's net loss and basic and diluted loss per share, attributing the loss to various operational factors Components of Loss for the Period (Six Months Ended June 30) | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | Cost of Inventories Sold | 64,991 | 41,891 | | Depreciation of Right-of-use Assets | 12 | 1,380 | | Depreciation of Property, Plant and Equipment | 4,439 | 5,072 | | Amortization of Intangible Assets | – | 73 | | Staff Costs (Including Directors' Emoluments) | 1,774 | 2,311 | - Basic loss per share attributable to owners of the Company was **RMB 2.4 cents** (2024: RMB 2.8 cents)[119](index=119&type=chunk)[124](index=124&type=chunk) - For the six months ended June 30, 2025, potential ordinary shares from share options had an anti-dilutive effect[120](index=120&type=chunk)[125](index=125&type=chunk) [Dividends and Fixed Assets](index=25&type=section&id=Dividends%20and%20Fixed%20Assets) Confirms no interim dividend declaration and no significant acquisitions of property, plant, and equipment during the period - The directors do not recommend the payment of an interim dividend for the six months ended June 30, 2025[121](index=121&type=chunk)[126](index=126&type=chunk) - For the six months ended June 30, 2025, the Group did not acquire property, plant and equipment, nor did it recognize additions to right-of-use assets[122](index=122&type=chunk)[123](index=123&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk) [Trade Receivables and Payables](index=26&type=section&id=Trade%20Receivables%20and%20Payables) Provides an aging analysis and discusses changes in trade receivables and payables, reflecting collection and payment trends Aging Analysis of Trade Receivables (As of June 30, 2025) | Aging | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | Less than 30 days | 17,617 | 48,449 | | 31 to 120 days | 33,393 | 138,953 | | 121 days to 1 year | 213,539 | 142,772 | | 1 to 2 years | 49,652 | 24,574 | | Over 2 years | – | 2,026 | | **Total** | **314,201** | **356,774** | | Less: Impairment Provision | (60,776) | (55,512) | | **Net Amount** | **253,425** | **301,262** | Aging Analysis of Trade and Other Payables (As of June 30, 2025) | Aging | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | Less than 30 days | 834 | 2,928 | | 31 to 120 days | 9,319 | 13,359 | | 121 days to 1 year | 5,266 | 425 | | 1 to 2 years | 8,973 | 37,683 | | Over 2 years | 14,417 | – | | **Total** | **38,809** | **54,395** | - The decrease in trade receivables was primarily due to improved collection from individual customers[44](index=44&type=chunk)[48](index=48&type=chunk) - The decrease in trade and other payables was mainly due to the Group's timely payments to suppliers[46](index=46&type=chunk)[48](index=48&type=chunk) [Bank and Other Borrowings](index=28&type=section&id=Bank%20and%20Other%20Borrowings) Details the group's bank and other borrowings, including interest rates, repayment terms, and collateral arrangements Breakdown of Bank and Other Borrowings (As of June 30, 2025) | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | Bank Loans (Secured) | 74,988 | 72,101 | | Other Borrowings | 53,638 | 53,661 | | **Total** | **128,626** | **125,762** | - All borrowings bear fixed interest rates ranging from **2.25% to 18.00%**, with a weighted average effective interest rate of approximately **7.9%**[47](index=47&type=chunk)[49](index=49&type=chunk) - Borrowings are secured by property, plant and equipment, right-of-use assets, shares held by certain company shareholders, and personal guarantees provided by Mr. Yu Huang, Ms. Chen Cheng, and minority shareholders[134](index=134&type=chunk) [Share Capital, Contingent Liabilities and Capital Commitment](index=29&type=section&id=Share%20Capital%2C%20Contingent%20Liabilities%20and%20Capital%20Commitment) Presents information on the company's issued share capital, absence of significant contingent liabilities, and capital commitments Share Capital Information (As of June 30, 2025) | Item | Number | Amount (HKD Thousand) | Amount (RMB Thousand) | | :--- | :--- | :--- | :--- | | Authorized Ordinary Shares (HKD 0.001 per share) | 5,000,000,000 | 5,000 | 4,470 | | Issued Ordinary Shares (HKD 0.001 per share) | 624,564,000 | 625 | 562 | - The Group had no significant contingent liabilities as of June 30, 2025[61](index=61&type=chunk)[66](index=66&type=chunk)[136](index=136&type=chunk) - The Group's total capital commitments as of June 30, 2025, amounted to approximately **RMB 13.1 million**, primarily for contracted but unprovided property, plant and equipment[62](index=62&type=chunk)[67](index=67&type=chunk)[138](index=138&type=chunk) [Other Information](index=30&type=section&id=Other%20Information) Includes disclosures on directors' and substantial shareholders' interests, share schemes, and corporate governance practices [Directors' and Substantial Shareholders' Interests](index=30&type=section&id=Directors'%20and%20Substantial%20Shareholders'%20Interests) Discloses the shareholdings of directors and substantial shareholders, including interests held through controlled corporations and as loan collateral Directors' Interests in Shares (As of June 30, 2025) | Director Name | Capacity/Nature of Interest | Number of Shares Held/Interested | Long/Short Position | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Mr. Yu Huang | Interest in Controlled Corporation | 194,784,667 | Long Position | 31.19% | Substantial Shareholders' Interests in Shares (As of June 30, 2025) | Shareholder Name/Entity | Capacity/Nature of Interest | Number of Shares Held/Interested | Long/Short Position | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Ms. Chen Cheng | Spouse's Interest | 194,784,667 | Long Position | 31.19% | | Top Synergy Y&C Limited | Beneficial Owner | 194,784,667 | Long Position | 31.19% | | Gold-Face Finance Limited | Corporation with Interest in Shares as Security | 119,300,000 | Long Position | 19.10% | | Upbest Group Limited | Interest in Controlled Corporation | 119,300,000 | Long Position | 19.10% | - Of the shares held by Top Synergy Y&C Limited, **119,300,000 shares** are pledged to Gold-Face Finance Limited as security for a loan[153](index=153&type=chunk) [Share Schemes](index=34&type=section&id=Share%20Schemes) Describes the company's share option and share schemes designed to incentivize and reward eligible participants - The 2020 Share Option Scheme was adopted on February 13, 2020, to grant share options to selected participants as incentives or rewards[154](index=154&type=chunk)[156](index=156&type=chunk) - As of June 30, 2025, **52,000,000 share options** remained unexercised under the 2020 Share Option Scheme, representing approximately **8.33%** of the issued shares[164](index=164&type=chunk)[166](index=166&type=chunk) - The 2025 Share Scheme was approved and adopted on June 30, 2025, to attract, motivate, and retain eligible participants through share awards or share options[167](index=167&type=chunk)[170](index=170&type=chunk) - The 2020 Share Option Scheme was terminated on June 30, 2025, and replaced by the 2025 Share Scheme[174](index=174&type=chunk) - The scheme mandate limit for the 2025 Share Scheme is **62,456,400 shares**, representing approximately **10.00%** of the total issued share capital[175](index=175&type=chunk)[177](index=177&type=chunk) - The remaining term of the 2025 Share Scheme is approximately **9 years and 10 months**[190](index=190&type=chunk)[193](index=193&type=chunk) [Corporate Governance and Compliance](index=41&type=section&id=Corporate%20Governance%20and%20Compliance) Affirms the group's commitment to high corporate governance standards and compliance with listing rules, including director conduct and audit committee review - The Company has complied with all applicable provisions of Appendix C1 Corporate Governance Code of the Listing Rules, except for the roles of Chairman and Chief Executive Officer being held by Mr. Yu Huang concurrently[199](index=199&type=chunk)[203](index=203&type=chunk) - The Board believes the current structure facilitates prompt and effective business decision-making, and the balance of power and authority is not impaired[203](index=203&type=chunk)[205](index=205&type=chunk)[208](index=208&type=chunk) - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers, all directors confirmed compliance, and no non-compliance by senior management was found[206](index=206&type=chunk)[209](index=209&type=chunk) - Mr. Hong Kun was appointed as an executive director on May 19, 2025[207](index=207&type=chunk)[210](index=210&type=chunk) - As of the date of this interim report, the company has repaid **HKD 20,000,000** under the loan agreement, with **HKD 10,000,000** remaining outstanding[218](index=218&type=chunk) - The directors are not aware of any conflicts of interest that compete with the Group's business[220](index=220&type=chunk)[222](index=222&type=chunk) - The Audit Committee has reviewed the interim results and accounting principles, and discussed audit, risk management, internal control, and financial statement matters[223](index=223&type=chunk)[225](index=225&type=chunk)

[Company Information](index=2&type=section&id=Company%20Information) [Company Name and Basic Information](index=2&type=section&id=Company%20Name%20and%20Basic%20Information) This section provides GBA Holdings Limited's fundamental corporate details, including company name, stock code, board members, committee compositions, and key contact and governance information - Company Name: **GBA Holdings Limited**[2](index=2&type=chunk)[5](index=5&type=chunk) - Stock Code: **00261**[2](index=2&type=chunk)[5](index=5&type=chunk) - Executive Directors include WONG Cho Wai (Chairman), LAM Ka Lee, and WONG Sze Yu[5](index=5&type=chunk) - Independent Non-executive Directors include WU Wai Shan, LEUNG Ka Chun, and CHAN Sheung Yu[5](index=5&type=chunk) [Chairman's Report](index=4&type=section&id=Chairman's%20Report) [Interim Results Overview](index=4&type=section&id=Interim%20Results%20Overview) For the six months ended June 30, 2025, the Group's revenue increased by 6.3% to HKD 31.2 million, but net loss attributable to owners significantly rose by 81.9% to HKD 43.2 million, primarily due to impairment losses and increased catering costs, with no interim dividend recommended 2025 Half-Year Key Financial Data (Chairman's Report) | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--------------------------------- | :--------------------------------- | :------- | | Revenue | 31,200,000 | 29,400,000 | +6.3% | | Net Loss Attributable to Owners of the Company | 43,200,000 | 23,800,000 | +81.9% | - The increase in loss was primarily due to increased impairment losses and direct costs for the catering business[6](index=6&type=chunk) - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 (June 30, 2024: nil)[7](index=7&type=chunk) [Business Review](index=4&type=section&id=Business%20Review) The Group's diversified businesses include property, financial, automobile, catering, and corporate advisory services, with property sales from Anshan, stable interest income from financial services, catering as the largest revenue contributor, no automobile revenue this period, and new corporate advisory services - Property Business: Primarily focused on three property projects in Anshan, Liaoning Province, with Phase 2.2 of "China Construction • Jun Gong Guan" completed in July 2025, generating approximately **HKD 7.6 million** in revenue for the period[8](index=8&type=chunk) - Financial Business: Operating money lending in Hong Kong, recorded approximately **HKD 4.2 million** in interest income for the period, with plans for expansion[9](index=9&type=chunk) - Automobile Business: Generated **no revenue** for the period but will continue to be developed[10](index=10&type=chunk) - Catering Business: Operating in Hong Kong, recorded approximately **HKD 19.3 million** in revenue for the period[11](index=11&type=chunk) - Corporate Advisory Services Business: Commenced in Hong Kong from April 2025, recorded approximately **HKD 72 thousand** in revenue for the period[12](index=12&type=chunk) [Outlook](index=6&type=section&id=Outlook) For 2025, the Group anticipates improved property sales driven by Chinese government policy support, while financial, automobile, and catering businesses are expected to remain stable or slightly improve due to projected interest rate reductions and increased consumer demand, as the Group seeks new opportunities to enhance shareholder returns - Property business sales are expected to improve in 2025, benefiting from the Chinese government's policy support for the property market[13](index=13&type=chunk) - Financial, automobile, and catering businesses are expected to remain stable or slightly improve, primarily influenced by anticipated interest rate reductions and increased consumer demand[13](index=13&type=chunk) - The Group will continue to expand its businesses based on market demand and available funds, and seek new opportunities to enhance shareholder returns[14](index=14&type=chunk) [Acknowledgements](index=6&type=section&id=Acknowledgements) The Chairman extends sincere gratitude to the Directors, management, employees, shareholders, investors, banks, customers, suppliers, and landlords for their unwavering commitment, loyalty, and strong support during challenging times - The Chairman thanks the Directors, management, and all employees for their unwavering commitment, loyalty, and diligent performance during challenging times[15](index=15&type=chunk) - Also thanks shareholders, investors, banks, customers, suppliers, and landlords for their encouragement and strong support during this special period[15](index=15&type=chunk) [Financial Review](index=7&type=section&id=Financial%20Review) [Revenue Analysis](index=7&type=section&id=Revenue%20Analysis) The Group's revenue for the six months ended June 30, 2025, increased by 6.3% to approximately HKD 31.2 million, with property business remaining the largest contributor at 24.3% despite a decline, while financial and catering businesses grew, and corporate advisory services contributed revenue for the first time Revenue Overview | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--------------------------------- | :--------------------------------- | :------- | | Total Revenue | 31,200,000 | 29,400,000 | +6.3% | - Property business revenue was approximately **HKD 7.6 million**, primarily from the sale of remaining units in Land New City and China Construction • Jun Gong Guan, accounting for approximately **24.3%** of total revenue[17](index=17&type=chunk) - Financial business revenue was approximately **HKD 4.2 million**, compared to approximately HKD 2.9 million in the same period last year[18](index=18&type=chunk) - Catering business revenue was approximately **HKD 19.3 million**, compared to approximately HKD 14.3 million in the same period last year[19](index=19&type=chunk) - Corporate advisory services business contributed revenue of approximately **HKD 72 thousand** for the first time[20](index=20&type=chunk) [Cost of Revenue and Gross Profit](index=7&type=section&id=Cost%20of%20Revenue%20and%20Gross%20Profit) Cost of revenue for the period significantly increased by 134.0% to approximately HKD 59.2 million, primarily due to increased impairment losses in the property business, resulting in a gross loss of approximately HKD 27.9 million and a gross loss margin of 89.5%, a substantial decline from the prior period's gross profit Cost of Revenue and Gross Profit Overview | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--------------------------------- | :--------------------------------- | :------- | | Cost of Revenue | 59,200,000 | 25,300,000 | +134.0% | | Gross (Loss)/Profit | (27,900,000) | 4,100,000 | N/A | | Gross (Loss)/Profit Margin | (89.5%) | 13.9% | N/A | - The increase in cost of revenue was primarily due to increased impairment losses on properties held for sale and properties under development in the property business[21](index=21&type=chunk) - The decrease in gross profit was primarily due to increased direct costs for the catering business and impairment losses on properties held for sale and properties under development[22](index=22&type=chunk) [Other Income and Expenses](index=8&type=section&id=Other%20Income%20and%20Expenses) Other income and gains for the period significantly increased to approximately HKD 7.1 million, mainly from lease modification gains and net reversal of impairment losses on expected credit losses, while sales and distribution expenses rose due to advertising, and administrative expenses decreased due to reduced staff salaries and depreciation - Financial assets at fair value through profit or loss recorded approximately **HKD 89 thousand** during the period[23](index=23&type=chunk) Other Income and Gains Overview | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--------------------------------- | :--------------------------------- | :------- | | Other Income and Gains | 7,100,000 | 1,300,000 | +446.2% | - The increase in other income was primarily due to lease modification gains and net reversal of impairment losses on expected credit losses during the period[24](index=24&type=chunk) Sales and Distribution Expenses Overview | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--------------------------------- | :--------------------------------- | :------- | | Sales and Distribution Expenses | 7,700,000 | 5,200,000 | +48.9% | - Administrative expenses decreased from approximately **HKD 23 million** to approximately **HKD 11.8 million**, primarily due to reduced staff salaries and depreciation[26](index=26&type=chunk) [Loss Attributable to Owners of the Company](index=8&type=section&id=Loss%20Attributable%20to%20Owners%20of%20the%20Company) Due to a significant increase in cost of revenue, the Group recorded a loss attributable to owners of the Company of approximately HKD 43.2 million for the six months ended June 30, 2025, a substantial increase from the HKD 23.8 million loss in the prior period Loss Attributable to Owners of the Company | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | | :--- | :--------------------------------- | :--------------------------------- | | Loss Attributable to Owners of the Company | 43,200,000 | 23,800,000 | - The increase in loss was primarily due to increased cost of revenue[27](index=27&type=chunk) [Liquidity and Financial Resources](index=9&type=section&id=Liquidity%20and%20Financial%20Resources) The Group maintains capital adequacy with net current assets of approximately HKD 429.2 million and a current ratio of 367.25%, experiencing an increase in cash and cash equivalents alongside a rise in bank overdrafts, primarily relying on net cash from operating activities and bank borrowings for future working capital needs Liquidity Overview | Metric | As at June 30, 2025 (HKD) | As at December 31, 2024 (HKD) | | :--- | :------------------- | :-------------------- | | Net Current Assets | 429,200,000 | 436,900,000 | | Cash and Cash Equivalents | 18,200,000 | 14,800,000 | | Current Ratio | 367.25% | 436.32% | | Bank Overdrafts | 19,300,000 | 9,900,000 | - The Group's working capital primarily comes from cash on hand and net cash used in operating activities, and will rely on bank borrowings (if needed) to meet future requirements[28](index=28&type=chunk) [Treasury Management and Risks](index=9&type=section&id=Treasury%20Management%20and%20Risks) The Group adopts a prudent treasury management approach, centralizing cash management and risk control, with no interest rate risk due to the absence of bank borrowings during the period, and considers foreign currency exchange risk not significant, with no intention to engage in high-risk foreign exchange derivative instruments - The Group manages cash and controls risks with a prudent approach, centralizing treasury activities[30](index=30&type=chunk) - There was **no interest rate risk** during the period due to the absence of bank borrowings[30](index=30&type=chunk) - The Group has **no significant exchange rate risk** and no intention to engage in any high-risk foreign exchange derivative instruments[30](index=30&type=chunk) [Significant Corporate Activities](index=9&type=section&id=Significant%20Corporate%20Activities) During the period, the Company acquired 100% equity interest in Grand Shine Capital Limited on April 1, 2025, making it a wholly-owned subsidiary, and as at the reporting period end, the Group had no capital commitments, pledged assets, or significant contingent liabilities - On April 1, 2025, the Company acquired **100% equity interest** in Grand Shine Capital Limited, making it a wholly-owned subsidiary[31](index=31&type=chunk) - As at June 30, 2025, the Group had **no capital commitments** (December 31, 2024: nil)[29](index=29&type=chunk) - As at June 30, 2025, the Group had **no pledged assets** (December 31, 2024: nil)[33](index=33&type=chunk) - As at June 30, 2025, the Group had **no significant contingent liabilities** (December 31, 2024: nil)[34](index=34&type=chunk) [Employees and Remuneration Policy](index=10&type=section&id=Employees%20and%20Remuneration%20Policy) As at June 30, 2025, the Group's total number of employees increased to 89, with a remuneration policy based on fairness, offering market-competitive and performance-linked compensation packages, including MPF, medical insurance, and bonuses, with potential share option grants Employee Count | Date | Total Employees | | :--- | :------- | | June 30, 2025 | 89 | | December 31, 2024 | 70 | - The remuneration policy is based on fairness, providing motivating, performance-measured, and market-competitive compensation packages[35](index=35&type=chunk) - In addition to salaries, other employee benefits include MPF contributions, medical insurance, and performance-linked bonuses, with eligible employees also potentially receiving share options[35](index=35&type=chunk) [Post-Reporting Period Events and Dividends](index=10&type=section&id=Post-Reporting%20Period%20Events%20and%20Dividends) Subsequent to the reporting period, the Company adopted a new share option scheme (2025 Scheme) on July 7, 2025, valid for ten years, and the Board does not recommend an interim dividend for the period ended June 30, 2025 - The Company adopted a new share option scheme (2025 Scheme) by ordinary resolution at an extraordinary general meeting held on July 7, 2025, valid for **ten years**[36](index=36&type=chunk) - The Board does not recommend the declaration of an interim dividend for the period ended June 30, 2025 (2024: nil)[38](index=38&type=chunk) [Use of Proceeds from Rights Issue](index=11&type=section&id=Use%20of%20Proceeds%20from%20Rights%20Issue) The Company received net proceeds of approximately HKD 48.3 million from the rights issue, with HKD 34.219 million utilized by June 30, 2025, for general working capital, catering and food-related investments, and financial business expansion, while the remaining HKD 14.081 million is earmarked for live streaming business investment, expected to be used by December 2026 - Net proceeds from the rights issue were approximately **HKD 48.3 million**[42](index=42&type=chunk) Use of Proceeds from Rights Issue (As at June 30, 2025) | Purpose | Planned Net Proceeds (HKD thousands) | Actual Net Proceeds Used (HKD thousands) | Unused Net Proceeds (HKD thousands) | Expected Timeline for Use | | :--- | :----------------------------- | :----------------------------- | :----------------------------- | :--------------- | | General working capital of the Company | 9,660 | 9,660 | – | Not applicable | | Investment in catering and food-related businesses | 14,490 | 14,490 | – | Not applicable | | Investment in live streaming business | 14,490 | 409 | 14,081 | December 2026 | | Expansion of financial business | 9,660 | 9,660 | – | Not applicable | | **Total** | **48,300** | **34,219** | **14,081** | | [Use of Proceeds from Placing](index=13&type=section&id=Use%20of%20Proceeds%20from%20Placing) The Company received net proceeds of approximately HKD 15.65 million from the placing, with HKD 9.233 million utilized by June 30, 2025, for general working capital and financial business expansion, and the remaining HKD 6.417 million expected to be used by December 31, 2025 - Net proceeds from the placing were approximately **HKD 15.65 million**[45](index=45&type=chunk) Use of Proceeds from Placing (As at June 30, 2025) | Purpose | Planned Net Proceeds (HKD thousands) | Actual Net Proceeds Used (HKD thousands) | Unused Net Proceeds (HKD thousands) | Expected Timeline for Use | | :--- | :----------------------------- | :----------------------------- | :----------------------------- | :--------------- | | General working capital of the Company | 6,260 | 3,358 | 2,902 | December 31, 2025 | | Expansion of financial business | 9,390 | 5,875 | 3,515 | December 31, 2025 | | **Total** | **15,650** | **9,233** | **6,417** | | [Interim Results](index=14&type=section&id=Interim%20Results) [Unaudited Condensed Consolidated Statement of Profit or Loss](index=14&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) The Group's revenue for the six months ended June 30, 2025, was HKD 31.226 million, but a significant increase in cost of revenue to HKD 59.163 million resulted in a gross loss of HKD 27.937 million, with the loss for the period expanding to HKD 41.006 million and basic and diluted loss per share attributable to owners of the Company at HKD 14.64 cents Unaudited Condensed Consolidated Statement of Profit or Loss Summary | Metric | For the six months ended June 30, 2025 (HKD thousands) | For the six months ended June 30, 2024 (HKD thousands) | | :--- | :--------------------------------- | :--------------------------------- | | Revenue | 31,226 | 29,363 | | Cost of Revenue | (59,163) | (25,282) | | Gross (Loss)/Profit | (27,937) | 4,081 | | Other Income and Gains | 7,148 | 1,271 | | Sales and Distribution Expenses | (7,678) | (5,157) | | Administrative Expenses | (11,773) | (22,953) | | Loss Before Tax | (41,170) | (25,614) | | Loss for the Period | (41,006) | (26,707) | | Loss for the Period Attributable to Owners of the Company | (43,248) | (23,778) | | Basic and Diluted Loss Per Share | (14.64 HK cents) | (2.45 HK cents) | [Unaudited Consolidated Statement of Comprehensive Income](index=15&type=section&id=Unaudited%20Consolidated%20Statement%20of%20Comprehensive%20Income) The Group's total comprehensive loss for the six months ended June 30, 2025, was HKD 41.006 million, an increase from HKD 38.875 million in the prior period, primarily reflecting the increased loss for the period Unaudited Consolidated Statement of Comprehensive Income Summary | Metric | For the six months ended June 30, 2025 (HKD thousands) | For the six months ended June 30, 2024 (HKD thousands) | | :--- | :--------------------------------- | :--------------------------------- | | Loss for the Period | (41,006) | (26,707) | | Exchange differences on translation of foreign operations | – | (12,168) | | Total Comprehensive Loss for the Period | (41,006) | (38,875) | | Total Comprehensive Loss for the Period Attributable to Owners of the Company | (43,248) | (35,946) | [Unaudited Condensed Consolidated Statement of Financial Position](index=16&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As at June 30, 2025, the Group's total assets increased to HKD 683.6 million, with current assets at HKD 589.8 million, total shareholders' equity at HKD 523.0 million, current liabilities rising to HKD 160.6 million, and net current assets at HKD 429.2 million Unaudited Condensed Consolidated Statement of Financial Position Summary | Metric | As at June 30, 2025 (HKD thousands) | As at December 31, 2024 (HKD thousands) | | :--- | :--------------------- | :--------------------- | | Total Non-current Assets | 93,768 | 93,129 | | Total Current Assets | 589,834 | 566,812 | | **Total Assets** | **683,602** | **659,941** | | Equity Attributable to Owners of the Company | 538,063 | 547,348 | | Total Equity | 522,991 | 530,034 | | Total Current Liabilities | 160,611 | 129,907 | | **Total Liabilities** | **160,611** | **129,907** | | Net Current Assets | 429,223 | 436,905 | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=18&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) The Group's total equity decreased to HKD 523.0 million for the six months ended June 30, 2025, with changes primarily driven by a HKD 21.222 million increase from shares issued under placing, a HKD 43.248 million loss attributable to owners of the Company, and exchange differences Unaudited Condensed Consolidated Statement of Changes in Equity Summary | Metric | As at June 30, 2025 (HKD thousands) | As at December 31, 2024 (HKD thousands) | | :--- | :--------------------- | :--------------------- | | Total Equity at Beginning of Period | 530,034 | 608,509 | | Shares issued under placing | 21,222 | – | | Loss for the Period (Attributable to Owners of the Company) | (43,248) | (23,778) | | Exchange differences on translation of foreign operations | 12,741 | (12,168) | | Total Equity at End of Period | 522,991 | 530,034 | [Unaudited Condensed Consolidated Statement of Cash Flows](index=19&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash flow from operating activities was an outflow of HKD 17.408 million, and from investing activities was an outflow of HKD 15.018 million, while financing activities generated an inflow of HKD 23.488 million due to share issuance, resulting in cash and cash equivalents of HKD 8.849 million at period-end Unaudited Condensed Consolidated Statement of Cash Flows Summary | Metric | For the six months ended June 30, 2025 (HKD thousands) | For the six months ended June 30, 2024 (HKD thousands) | | :--- | :--------------------------------- | :--------------------------------- | | Net cash flows (used in)/from operating activities | (17,408) | (1,158) | | Net cash flows (used in)/from investing activities | (15,018) | 6,142 | | Net cash flows from/(used in) financing activities | 23,488 | (4,923) | | Net (decrease)/increase in cash and cash equivalents | (8,938) | 61 | | Cash and cash equivalents at end of period | 8,849 | 39,910 | [Notes to the Financial Statements](index=21&type=section&id=Notes%20to%20the%20Financial%20Statements) This section provides detailed notes to the interim financial statements, covering basis of preparation, accounting policies, operating segment information, revenue composition, other income and gains, loss before tax, income tax, finance costs, dividends, loss per share, property, plant and equipment, inventories, loans and interest receivable, investments in associates/subsidiaries, trade receivables, pledged time deposits and cash, share capital, trade payables, other payables and accrued liabilities, contingent liabilities, pledged assets, commitments, related party transactions, and post-reporting period events [Basis of Preparation and Principal Accounting Policies](index=21&type=section&id=Basis%20of%20Preparation%20and%20Principal%20Accounting%20Policies) The unaudited condensed interim consolidated financial statements are prepared in accordance with Appendix 16 of the Listing Rules and HKAS 34, with accounting policies consistent with the 2024 annual report, except for newly adopted HKFRS that had no impact on financial position or performance - The unaudited condensed interim consolidated financial statements are prepared in accordance with Appendix 16 of the Listing Rules and Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[55](index=55&type=chunk) - The accounting policies adopted are consistent with those in the 2024 annual report, except for the revised Hong Kong Financial Reporting Standards adopted for the first time in the current period, where the amendments to HKAS 21 had no impact on financial position and performance[56](index=56&type=chunk)[57](index=57&type=chunk) [Operating Segment Information](index=22&type=section&id=Operating%20Segment%20Information) The Group is organized into five reportable operating segments: property, financial, automobile, catering, and corporate advisory services, with segment performance evaluated based on adjusted profit/(loss) before tax, excluding specific costs, and all revenue is concentrated in Mainland China and Hong Kong, with no single customer accounting for more than 10% of total revenue - The Group is organized into five reportable operating segments: property business, financial business, automobile business, catering business, and corporate advisory services business[58](index=58&type=chunk)[60](index=60&type=chunk) - Segment performance is evaluated based on adjusted profit/(loss) before tax, which excludes finance costs, equity-settled share option expenses, and head office and corporate expenses[58](index=58&type=chunk) - The Group's markets are concentrated solely in Mainland China and Hong Kong, which contributed all of the Group's total revenue for the six months ended June 30, 2025, and 2024[64](index=64&type=chunk) - For the six months ended June 30, 2025, **no single customer** accounted for more than **10%** of the Group's total revenue[66](index=66&type=chunk) [Revenue Composition](index=27&type=section&id=Revenue%20Composition) This section details the Group's revenue composition, primarily from property sales, restaurant operations, interest income from loans, and corporate advisory services, with property sales revenue from Mainland China recognized at the point of transfer, and performance obligations satisfied upon transfer of properties, delivery of collectible cars, or provision of restaurant services Revenue Source Analysis | Revenue Source | For the six months ended June 30, 2025 (HKD thousands) | For the six months ended June 30, 2024 (HKD thousands) | | :--- | :--------------------------------- | :--------------------------------- | | Sale of properties | 7,581 | 12,114 | | Restaurant operations | 19,327 | 14,337 | | Interest income from loans receivable | 4,247 | 2,912 | | Corporate advisory services | 72 | – | | **Total** | **31,227** | **29,363** | - Property sales revenue of approximately **HKD 7.6 million** was from Mainland China, recognized at the point of property transfer[70](index=70&type=chunk) - Performance obligations are satisfied upon transfer of properties, delivery of collectible cars, or provision of restaurant services[71](index=71&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) [Other Income and Gains](index=29&type=section&id=Other%20Income%20and%20Gains) This section provides a detailed breakdown of other income and gains, including interest income, exchange difference gains, lease modification gains, net reversal of impairment losses on expected credit losses, and other miscellaneous items Other Income and Gains Details | Item | For the six months ended June 30, 2025 (HKD thousands) | For the six months ended June 30, 2024 (HKD thousands) | | :--- | :--------------------------------- | :--------------------------------- | | Interest income | 295 | 721 | | Exchange difference gain | 207 | 23 | | Lease modification gain | 2,173 | – | | Net reversal of impairment losses on expected credit losses | 4,425 | – | | Others | 48 | 71 | | **Total** | **7,148** | **1,271** | [Loss Before Tax and Income Tax](index=29&type=section&id=Loss%20Before%20Tax%20and%20Income%20Tax) Loss before tax is stated after deducting cost of revenue of HKD 59.163 million and depreciation of HKD 53 thousand, with an income tax credit of HKD 164 thousand recorded for the period, primarily from Mainland China land appreciation tax, and no provision for Hong Kong profits tax due to the absence of assessable profits - Loss before tax is stated after deducting cost of revenue of **HKD 59.163 million** (2024: HKD 25.282 million) and depreciation of **HKD 53 thousand** (2024: HKD 5.418 million)[76](index=76&type=chunk) - Income tax credit of **HKD 164 thousand** (2024: expense of HKD 1.093 million) was recorded for the period, primarily from Mainland China land appreciation tax[78](index=78&type=chunk) - No provision for Hong Kong profits tax was made for the period as the Group had no assessable profits in Hong Kong[77](index=77&type=chunk) [Finance Costs and Dividends](index=30&type=section&id=Finance%20Costs%20and%20Dividends) This section details the Group's finance costs, including interest on lease liabilities and other loans/bank overdrafts, and confirms that the Board does not recommend an interim dividend for the six months ended June 30, 2025 Finance Costs Analysis | Item | For the six months ended June 30, 2025 (HKD thousands) | For the six months ended June 30, 2024 (HKD thousands) | | :--- | :--------------------------------- | :--------------------------------- | | Interest on lease liabilities | 372 | 352 | | Interest on other loans and bank overdrafts | 231 | 467 | | **Total** | **603** | **819** | - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)[80](index=80&type=chunk) [Loss Per Share](index=31&type=section&id=Loss%20Per%20Share) This section presents the basic and diluted loss per share attributable to owners of the Company's ordinary shares, along with the weighted average number of ordinary shares used in the calculation, adjusted to reflect the share consolidation subsequent to the reporting period Basic and Diluted Loss Per Share | Metric | For the six months ended June 30, 2025 (HK cents) | For the six months ended June 30, 2024 (HK cents) | | :--- | :--------------------------------- | :--------------------------------- | | Loss attributable to owners of the Company's ordinary shares | (14.64) | (2.45) | Weighted Average Number of Ordinary Shares Outstanding for the Period | Date | Number of Shares | | :--- | :------------- | | June 30, 2025 | 295,329,737 | | June 30, 2024 | 970,157,660 | - The weighted average number of ordinary shares used for calculating basic and diluted loss per share has been adjusted to reflect the share consolidation subsequent to the reporting period[84](index=84&type=chunk) [Property, Plant and Equipment](index=32&type=section&id=Property%2C%20Plant%20and%20Equipment) This section provides the carrying amount of property, plant and equipment, noting an increase primarily due to additions and the acquisition of a subsidiary Carrying Amount of Property, Plant and Equipment | Date | Carrying Amount (HKD thousands) | | :--- | :-------------- | | June 30, 2025 | 616 | | December 31, 2024 | 129 | - The increase in carrying amount was primarily due to additions and acquisition of a subsidiary[86](index=86&type=chunk) [Inventories](index=33&type=section&id=Inventories) This section presents the total inventories, primarily comprising automobile inventory and catering materials Total Inventories | Date | Total (HKD thousands) | | :--- | :------------ | | June 30, 2025 | 48,144 | | December 31, 2024 | 48,195 | - Inventories primarily comprise automobile inventory of **HKD 47.68 million** and catering materials of **HKD 464 thousand**[87](index=87&type=chunk) [Loans and Interest Receivable](index=33&type=section&id=Loans%20and%20Interest%20Receivable) This section details the total loans and interest receivable, including loans receivable, interest receivable, and provision for expected credit losses Total Loans and Interest Receivable | Date | Total (HKD thousands) | | :--- | :------------ | | June 30, 2025 | 108,312 | | December 31, 2024 | 98,146 | - Loans receivable were **HKD 96.5 million**, interest receivable was **HKD 16.704 million**, and provision for expected credit losses was **HKD 4.892 million**[88](index=88&type=chunk) [Investments in Associates/Subsidiaries](index=33&type=section&id=Investments%20in%20Associates%2FSubsidiaries) This section outlines the Group's investments, including goodwill on acquisition and its equity interests in Kei Wah Limited (catering and related food business) and Grand Shine Capital Limited (corporate advisory services business) - Goodwill on acquisition was **HKD 152 thousand**[89](index=89&type=chunk) - The Group holds **51% interest** in Kei Wah Limited (catering and related food business) and **100% interest** in Grand Shine Capital Limited (corporate advisory services business)[90](index=90&type=chunk)[91](index=91&type=chunk) [Trade Receivables](index=35&type=section&id=Trade%20Receivables) This section provides an ageing analysis of trade receivables as at June 30, 2025, which primarily represent amounts due from the catering and related food business in Hong Kong Ageing Analysis of Trade Receivables (As at June 30, 2025) | Ageing | Balance (HKD thousands) | Percentage | | :--- | :------------ | :------- | | Current to 30 days | 773 | 33% | | 31 to 60 days | 108 | 5% | | 61 to 90 days | 133 | 6% | | Over 90 days | 1,320 | 56% | | **Total** | **2,334** | **100%** | - As at June 30, 2025, trade receivables were amounts due from the catering and related food business in Hong Kong[92](index=92&type=chunk) [Pledged Time Deposits and Cash and Cash Equivalents](index=35&type=section&id=Pledged%20Time%20Deposits%20and%20Cash%20and%20Cash%20Equivalents) This section provides an analysis of cash and cash equivalents, including cash and bank equivalents, pledged time deposits, and bank overdrafts, along with details on available banking facilities and RMB-denominated cash Cash and Cash Equivalents Analysis | Item | As at June 30, 2025 (HKD thousands) | As at December 31, 2024 (HKD thousands) | | :--- | :--------------------- | :--------------------- | | Cash and bank equivalents | 18,160 | 14,830 | | Pledged time deposits | 10,000 | 10,000 | | Less: Bank overdrafts | (19,311) | (9,911) | | **Cash and cash equivalents (Consolidated Statement of Cash Flows)** | **8,849** | **14,919** | - The Group's available banking facilities were **HKD 10 million**, of which approximately **HKD 9.958 million** was utilized[94](index=94&type=chunk) - RMB-denominated cash and cash equivalents were **HKD 2.192 million** (December 31, 2024: HKD 1.054 million)[93](index=93&type=chunk) [Share Capital](index=36&type=section&id=Share%20Capital) This section presents the issued and fully paid share capital, detailing the number of shares and their par value Issued and Fully Paid Share Capital | Date | Number of Shares | Ordinary shares of HKD 0.20 par value each (HKD thousands) | | :--- | :------------- | :--------------------------------- | | June 30, 2025 | 238,234,732 | 47,647 | | December 31, 2024 | 970,157,660 | 38,806 | [Trade Payables](index=37&type=section&id=Trade%20Payables) This section provides an ageing analysis of trade payables as at June 30, 2025, noting that they are non-interest bearing and generally have credit payment terms ranging from 30 to 120 days Ageing Analysis of Trade Payables (As at June 30, 2025) | Ageing | Balance (HKD thousands) | Percentage | | :--- | :------------ | :------- | | Current to 30 days | 11,022 | 26.0% | | Over 90 days | 31,371 | 74.0% | | **Total** | **42,399** | **100%** | - Trade payables are non-interest bearing and generally have credit payment terms ranging from **30 to 120 days**[96](index=96&type=chunk) [Other Payables and Accrued Liabilities](index=37&type=section&id=Other%20Payables%20and%20Accrued%20Liabilities) This section details the total other payables and accrued liabilities, highlighting a significant increase in contract liabilities, including amounts received for property sales, and notes other unsecured loans from an independent third party Total Other Payables and Accrued Liabilities | Date | Total (HKD thousands) | | :--- | :------------ | | June 30, 2025 | 98,897 | | December 31, 2024 | 79,543 | - Contract liabilities significantly increased to **HKD 48.792 million** (December 31, 2024: HKD 25.367 million), including amounts received and/or deposits for property sales[97](index=97&type=chunk)[99](index=99&type=chunk) - Other loans are unsecured loans from independent third party Mideast Investment Limited, bearing interest at **5% per annum** and repayable within one year[97](index=97&type=chunk) [Contingent Liabilities, Pledged Assets and Commitments](index=38&type=section&id=Contingent%20Liabilities%2C%20Pledged%20Assets%20and%20Commitments) As at June 30, 2025, the Group had no significant contingent liabilities, pledged assets, or commitments - As at June 30, 2025, the Group had **no significant contingent liabilities** (December 31, 2024: nil)[100](index=100&type=chunk) - As at June 30, 2025, the Group had **no pledged assets** (December 31, 2024: nil)[101](index=101&type=chunk) - As at June 30, 2025, the Group had **no significant commitments** (December 31, 2024: nil)[102](index=102&type=chunk) [Related Party Transactions](index=38&type=section&id=Related%20Party%20Transactions) This section details related party transactions, including interest income from Ohoh, and notes that China Construction Fortunes Group ceased to be a related party after July 5, 2022 - For the six months ended June 30, 2025, interest income from Ohoh was **HKD 179 thousand**[103](index=103&type=chunk) - China Construction Fortunes Group ceased to be a related party of the Group after July 5, 2022[103](index=103&type=chunk) [Post-Reporting Period Events and Approval of Interim Report](index=39&type=section&id=Post-Reporting%20Period%20Events%20and%20Approval%20of%20Interim%20Report) This section outlines post-reporting period events, specifically the adoption of a new share option scheme on July 7, 2025, valid for 10 years, and confirms the approval date of this interim report by the Board - The Company adopted a new share option scheme (2025 Scheme) on July 7, 2025, valid for **10 years**[104](index=104&type=chunk) - This interim report was approved by the Board on **August 29, 2025**[106](index=106&type=chunk) [Disclosure of Interests](index=40&type=section&id=Disclosure%20of%20Interests) [Directors' and Chief Executive's Interests in Shares and Underlying Shares](index=40&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20in%20Shares%20and%20Underlying%20Shares) As at June 30, 2025, Executive Director Mr. WONG Cho Wai held 3,638,400 shares through a controlled corporation, representing 1.53% of the total issued shares, with no other Directors or chief executive having disclosable interests Directors' Interests in Shares and Underlying Shares (Long Position, As at June 30, 2025) | Director's Name | Capacity/Nature of Interest | Number of Shares | Number of Share Options | Total Interest | Approximate Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | :--- | :--- | | WONG Cho Wai | Interest in a controlled corporation | 3,638,400 | – | 3,638,400 | 1.53% | - Mr. WONG Cho Wai beneficially owns **100%** of the issued share capital of Top Pioneer Holdings Limited and is therefore deemed to be interested in all shares held by it[108](index=108&type=chunk) [Substantial Shareholders' Interests](index=41&type=section&id=Substantial%20Shareholders'%20Interests) As at June 30, 2025, apart from Directors, substantial shareholder Mr. SHEN Shui Ping held 9,712,000 shares, representing 4.08% of the total issued shares Substantial Shareholders' Interests in Shares and Underlying Shares (Long Position, As at June 30, 2025) | Name of Substantial Shareholder | Capacity/Nature of Interest | Number of Shares | Total Interest | Approximate Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | :--- | | SHEN Shui Ping | Beneficial owner | 9,712,000 | 9,712,000 | 4.08% | [Share Option Schemes](index=42&type=section&id=Share%20Option%20Schemes) [2021 Scheme](index=42&type=section&id=2021%20Scheme) For the six months ended June 30, 2025, no share options were outstanding at the beginning of the period under the 2021 Scheme, with 9 million options granted and 5.4 million exercised by employees, leaving 3.6 million options outstanding at period-end, granted to Executive Directors LAM Ka Lee and WONG Sze Yu 2021 Scheme Share Option Movement Details (As at June 30, 2025) | Name and/or Category | Outstanding as at January 1, 2025 | Granted during the period | Exercised during the period | Outstanding as at June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | LAM Ka Lee (Executive Director) | – | 1,800,000 | – | 1,800,000 | | WONG Sze Yu (Executive Director) | – | 1,800,000 | – | 1,800,000 | | Employees | – | 5,400,000 | 5,400,000 | – | | **Total** | **–** | **9,000,000** | **5,400,000** | **3,600,000** | - As at the date of this interim report, a total of **3.6 million** share options remained outstanding under the 2021 Scheme[113](index=113&type=chunk) [2025 Scheme](index=43&type=section&id=2025%20Scheme) The Company adopted a new share option scheme (2025 Scheme) on July 7, 2025, which is valid for 10 years from its adoption date - The 2025 Scheme became effective on **July 7, 2025**, and will be valid for **10 years** from its adoption date[114](index=114&type=chunk) [Other Information](index=44&type=section&id=Other%20Information) [Purchase, Sale or Redemption of the Company's Listed Securities or Treasury Shares](index=44&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities%20or%20Treasury%20Shares) During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities, and no treasury shares were held at period-end - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[115](index=115&type=chunk) - As at the end of the reporting period, the Company held **no treasury shares**[115](index=115&type=chunk) [Corporate Governance](index=44&type=section&id=Corporate%20Governance) The Company is committed to maintaining high corporate governance standards and complied with all code provisions of the Corporate Governance Code during the six months ended June 30, 2025, with a minor deviation regarding the separation of roles between Chairman and Chief Executive, as the CEO position is currently vacant and responsibilities are shared among Board members - The Company has complied with all code provisions of the Corporate Governance Code and Corporate Governance Report in Appendix 14 of the Listing Rules during the six months ended June 30, 2025, except for a minor deviation from code provision C.2.1[116](index=116&type=chunk) - Code provision C.2.1 stipulates that the roles of chairman and chief executive should be separate and not performed by the same individual; the position of Chief Executive is currently vacant, and its roles and responsibilities are shared among Board members[116](index=116&type=chunk)[117](index=117&type=chunk) [Standard Code for Securities Transactions by Directors](index=45&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted a code of conduct for Directors' securities transactions that is no less stringent than the Standard Code, and all Directors confirmed compliance with this code during the reporting period - The Company has adopted a code of conduct for Directors' securities transactions, the terms of which are no less stringent than the required standard set out in the Standard Code[119](index=119&type=chunk) - Following specific enquiries with all Directors, they have confirmed compliance with the required standard set out in the Company's adopted Standard Code for the six months ended June 30, 2025[119](index=119&type=chunk) [Review of Interim Report](index=45&type=section&id=Review%20of%20Interim%20Report) The Audit Committee has reviewed the Group's interim report, including the unaudited condensed consolidated financial statements for the six months ended June 30, 2025 - The Audit Committee has reviewed the Group's interim report, including the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025[120](index=120&type=chunk) [Changes in Directors' Information](index=45&type=section&id=Changes%20in%20Directors'%20Information) Since the approval date of the Company's 2024 annual report, there have been no other changes in Directors' information requiring disclosure under Rule 13.51B(1) of the Listing Rules - Save as disclosed, there have been no changes in the Company's Directors for the six months ended June 30, 2025, and up to the date of this interim report, and no other information is required to be disclosed under Rule 13.51B(1) of the Listing Rules[121](index=121&type=chunk)

Interim Results Announcement [Condensed Consolidated Statement of Profit or Loss](index=1&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) The Group's revenue grew significantly, but a sharp decline in gross profit and a surge in operating loss widened the loss for the period Key Data from the Condensed Consolidated Statement of Profit or Loss | Metric | 2025 (HK$ thousands) | 2024 (HK$ thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 148,849 | 93,698 | 58.9% | | Cost of revenue | (137,013) | (61,993) | 121.0% | | Gross profit | 11,836 | 31,705 | (62.7%) | | Operating loss | (68,914) | (7,305) | 846.1% | | Loss for the period | (61,983) | (36,813) | 68.4% | | Loss attributable to owners of the Company | (6,099) | (25,808) | (76.4%) | | Basic loss per share (HK$) | (0.5) | (2.11) | (76.3%) | [Condensed Consolidated Statement of Other Comprehensive Income](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The Group's total comprehensive loss for the period narrowed, influenced by exchange differences on translation of foreign operations Key Data from the Condensed Consolidated Statement of Other Comprehensive Income | Metric | 2025 (HK$ thousands) | 2024 (HK$ thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Loss for the period | (61,983) | (36,813) | 68.4% | | Release of exchange reserve upon disposal of a subsidiary | (25,957) | – | N/A | | Exchange differences on translation of foreign operations | 27,123 | (27,914) | N/A | | Total comprehensive loss for the period | (60,896) | (64,575) | (5.7%) | | Total comprehensive loss attributable to owners of the Company | (21,147) | (39,127) | (46.0%) | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) The Group's total assets and net assets decreased, while net current liabilities widened despite a significant increase in cash reserves Key Data from the Condensed Consolidated Statement of Financial Position | Metric | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 1,553,850 | 1,612,055 | (3.6%) | | Current assets | 385,801 | 529,482 | (27.2%) | | Total assets | 1,939,651 | 2,141,537 | (9.4%) | | Current liabilities | 794,834 | 884,723 | (10.2%) | | Non-current liabilities | 476,038 | 527,139 | (9.7%) | | Total liabilities | 1,270,872 | 1,411,862 | (10.0%) | | Net current liabilities | (409,033) | (355,241) | 15.1% | | Net assets | 668,779 | 729,675 | (8.3%) | | Total equity | 668,779 | 729,675 | (8.3%) | - Cash and cash equivalents stood at **HK$67,928 thousand** as of 30 June 2025, a **54.5% increase** from HK$43,969 thousand as of 31 December 2024[6](index=6&type=chunk) Notes to the Condensed Consolidated Financial Statements [1. General Information](index=6&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) G-Vision International (Holdings) Limited is a Bermuda-incorporated public company engaged in investment holding and property-related businesses - The principal activities include **investment holding, property development, property investment, and general trading**[8](index=8&type=chunk) [2. Basis of Preparation](index=6&type=section&id=2.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) The financial statements are prepared in accordance with HKAS 34 and the Listing Rules, using consistent accounting policies - The statements are prepared in accordance with **Hong Kong Accounting Standard 34 "Interim Financial Reporting"** and the Listing Rules of the Stock Exchange[9](index=9&type=chunk) - The accounting policies used are **consistent with those of the annual financial statements** for the year ended 31 December 2024[9](index=9&type=chunk) [3. Application of New and Amendments to Hong Kong Financial Reporting Standards (HKFRSs)](index=6&type=section&id=3.%20%E6%87%89%E7%94%A8%E6%96%B0%E8%A8%82%E5%8F%8A%E7%B6%93%E4%BF%AE%E8%A8%82%E9%A6%99%E6%B8%AF%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%E6%9C%83%E8%A8%88%E6%BA%96%E5%89%87) The Group adopted all new and amended HKFRSs effective from 1 January 2025 without material impact on its financial statements - The application of new and amended HKFRSs **did not result in substantial changes**[10](index=10&type=chunk) - The Group is assessing the impact of standards not yet effective and cannot currently state whether they would have a significant impact[11](index=11&type=chunk) [4. Segment Reporting](index=7&type=section&id=4.%20%E5%88%86%E9%83%A8%E5%A0%B1%E5%91%8A) The Group's operations are organized into four reportable segments: property development, property investment, hotel operation, and general trading - The reportable operating segments are **property development, property investment, hotel operation, and general trading**[12](index=12&type=chunk) [4.a Segment revenue and results](index=7&type=section&id=4.a%20%E5%88%86%E9%83%A8%E6%94%B6%E7%9B%8A%E5%8F%8A%E6%A5%AD%E7%B8%BE) Property development revenue and results grew strongly, but the property investment segment swung to a significant loss, causing a total segment loss Segment Revenue and Results | Segment | 2025 Revenue (HK$ thousands) | 2024 Revenue (HK$ thousands) | Revenue Change (%) | 2025 Results (HK$ thousands) | 2024 Results (HK$ thousands) | Results Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Property development | 135,702 | 76,007 | 78.5% | 51,159 | 19,770 | 158.8% | | Property investment | 9,872 | 12,837 | (23.0%) | (91,272) | 2,165 | N/A (Profit to Loss) | | Hotel operation | 3,264 | 3,591 | (9.1%) | (842) | (757) | 11.2% | | General trading | – | 1,145 | (100.0%) | – | 291 | (100.0%) | | Others | 11 | 118 | (90.7%) | 11 | (407) | N/A (Loss to Profit) | | **Total** | **148,849** | **93,698** | **58.9%** | **(40,944)** | **21,062** | **N/A (Profit to Loss)** | [4.b Segment assets and liabilities](index=9&type=section&id=4.b%20%E5%88%86%E9%83%A8%E8%B3%87%E7%94%A2%E5%8F%8A%E8%B2%A0%E5%82%B5) Total segment assets and liabilities both decreased, primarily driven by reductions in the property development and property investment segments Segment Assets and Liabilities | Segment | Assets at 30 June 2025 (HK$ thousands) | Assets at 31 Dec 2024 (HK$ thousands) | Asset Change (%) | Liabilities at 30 June 2025 (HK$ thousands) | Liabilities at 31 Dec 2024 (HK$ thousands) | Liability Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Property development | 254,403 | 421,208 | (39.6%) | (211,795) | (216,707) | (2.3%) | | Property investment | 1,371,924 | 1,420,502 | (3.4%) | (223,871) | (240,854) | (7.0%) | | Hotel operation | 75,095 | 76,884 | (2.3%) | – | – | N/A | | General trading | – | 14 | (100.0%) | – | – | N/A | | Others | 27 | 26 | 3.8% | – | – | N/A | | **Total segment** | **1,701,449** | **1,918,634** | **(11.3%)** | **(435,666)** | **(457,561)** | **(4.8%)** | [5. Income Tax Credit/(Expense)](index=10&type=section&id=5.%20%E6%89%80%E5%BE%97%E7%A8%85%E6%8A%B5%E5%85%8D%E2%95%B1%EF%BC%88%E9%96%8B%E6%94%AF%EF%BC%89) The Group recorded an income tax credit due to a significant deferred tax credit, a reversal from the prior period's tax expense Income Tax Credit/(Expense) | Metric | 2025 (HK$ thousands) | 2024 (HK$ thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Current tax - PRC Land Appreciation Tax | (1,778) | (2,753) | (35.4%) | | Deferred tax | 24,871 | 95 | 26185.3% | | **Income tax credit/(expense)** | **23,093** | **(2,658)** | **N/A (Expense to Credit)** | - Chinese subsidiaries are subject to a **25% corporate income tax rate**[18](index=18&type=chunk) - Land Appreciation Tax is calculated at progressive rates ranging from **30% to 60%**[18](index=18&type=chunk) [6. Loss for the Period](index=11&type=section&id=6.%20%E6%9C%9F%E5%85%A7%E8%99%A7%E6%90%8D) The loss for the period was driven by fair value losses on investment properties and impairment losses, offset by a gain on disposal of a subsidiary Key Items Affecting Loss for the Period | Metric | 2025 (HK$ thousands) | 2024 (HK$ thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Amortisation of intangible assets | 370 | 378 | (2.1%) | | Depreciation of property, plant and equipment | 7,303 | 7,396 | (1.3%) | | Depreciation of right-of-use assets | 306 | 306 | 0.0% | | Staff costs | 8,491 | 9,691 | (12.4%) | | Gain on disposal of a subsidiary | (60,637) | – | N/A | | Fair value loss on investment properties | 92,179 | – | N/A | | Impairment loss on properties held for sale | 12,676 | – | N/A | [7. Loss Per Share](index=11&type=section&id=7.%20%E6%AF%8F%E8%82%A1%E8%99%A7%E6%90%8D) Basic loss per share narrowed significantly, and diluted loss per share was not presented due to the anti-dilutive effect of convertible bonds - **Basic loss per share** was **HK$0.5** in 2025, a significant narrowing from HK$2.11 in 2024[20](index=20&type=chunk) - Diluted loss per share was not presented due to the **anti-dilutive effect** of convertible bonds[21](index=21&type=chunk) [8. Dividends](index=12&type=section&id=8.%20%E8%82%A1%E6%81%AF) No dividends were paid, declared, or proposed during the reporting period - No dividends were paid, declared, or proposed during the reporting period[22](index=22&type=chunk) [9. Property, Plant and Equipment](index=12&type=section&id=9.%20%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99) The Group increased its additions to property, plant, and equipment during the period and made no disposals - Additions to property, plant and equipment were **HK$133,000** in 2025, compared to HK$11,000 in 2024[23](index=23&type=chunk) - No property, plant and equipment were disposed of during the period[23](index=23&type=chunk) [10. Trade Receivables](index=12&type=section&id=10.%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) Total trade receivables decreased, with the majority of balances aged over 365 days, and provisions for expected credit losses were made Ageing Analysis of Trade Receivables | Ageing | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | 0 to 90 days | 812 | 3,572 | (77.2%) | | 91 to 180 days | 78 | 51 | 52.9% | | 181 to 365 days | 3 | 14 | (78.6%) | | Over 365 days | 2,011 | 2,001 | 0.5% | | **Total** | **2,904** | **5,638** | **(48.5%)** | - The Group applies the simplified approach under **HKFRS 9** to provide for expected credit losses[25](index=25&type=chunk) - Provision for expected credit losses was **(HK$2,558) thousand** as of 30 June 2025, compared to (HK$2,442) thousand as of 31 December 2024[26](index=26&type=chunk) [11. Trade and Other Payables](index=14&type=section&id=11.%20%E8%B2%BF%E6%98%93%E6%87%89%E4%BB%98%E8%B3%AC%E6%AC%BE%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE) Total trade and other payables decreased significantly, driven by reductions in amounts due to construction contractors and legal case provisions Key Data for Trade and Other Payables | Metric | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total trade and other payables | 223,911 | 307,999 | (27.3%) | | Trade payables to construction contractors | 44,307 | 67,687 | (34.5%) | | Provision for legal case compensation | 34,643 | 79,174 | (56.3%) | [12. Share Capital](index=15&type=section&id=12.%20%E8%82%A1%E6%9C%AC) The Group's authorized and issued share capital remained unchanged during the period - **Authorised share capital**: 2,500,000,000 ordinary shares of HK$0.20 each, amounting to **HK$500,000 thousand** (as at 30 June 2025 and 31 December 2024)[30](index=30&type=chunk) - **Issued and fully paid share capital**: 12,247,770 ordinary shares of HK$0.20 each, amounting to **HK$2,449 thousand** (as at 30 June 2025 and 31 December 2024)[30](index=30&type=chunk) [13. Litigation and Contingent Liabilities](index=15&type=section&id=13.%20%E8%A8%B4%E8%A8%9F%E5%8F%8A%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) The Group is involved in several legal proceedings and contingent liabilities whose financial impact cannot be reliably measured at present - **Shareholder representative action**: A claim was filed by Season Hong Kong Trading Limited against former executive directors and a subsidiary, with the trial date yet to be fixed[31](index=31&type=chunk) - The retrial appeal by **Ka Fung Industrial Company Limited** was dismissed; the Company has made sufficient provisions and sold all shares in Ka Fung[33](index=33&type=chunk) - **Zhejiang Beishen Cultural Tourism Development Co, Ltd bankruptcy case**: Happy Holiday Hotel Management (Shenzhen) Co, Ltd received the first distribution of bankruptcy claims of RMB2,777,000[34](index=34&type=chunk) - **Zhejiang Beishen vs G-Vision Properties Development (Shenzhen) Co, Ltd**: The court ordered enforcement of RMB30,194,804; the Company has made a provision of RMB31,053,867[35](index=35&type=chunk) - **Hao Kang International Supply Chain (Shenzhen) Co, Ltd suspected fraud case**: A criminal investigation has been initiated by PRC Public Security, and the Company may pursue civil litigation[35](index=35&type=chunk) - The directors believe the above litigations will not have a material impact on the Group's operations, but the financial impact cannot be reliably measured[32](index=32&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) Management Discussion and Analysis [1. Business Review and Outlook](index=18&type=section&id=1.%20%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%B1%95%E6%9C%9B) The Group achieved strong sales at its Shenzhen project amid a stabilizing Chinese property market and plans strategic transformations for future growth - **China's property market**: Showed signs of stabilization in the first half of 2025 but still faces significant pressure and structural differentiation[36](index=36&type=chunk) - **Shenzhen Mix Park project**: Maintained strong sales performance through differentiated pricing and omni-channel marketing, ranking first in city-wide property sales from mid-May to June 2024[36](index=36&type=chunk)[37](index=37&type=chunk) - **Hotel business**: Digital transformation led to online booking rates exceeding **80%**, occupancy rates stabilizing around **85%**, and customer satisfaction reaching **92%**[39](index=39&type=chunk) - **Xuzhou Golden Harbour Plaza project**: Plans to transform it into a regional tourist accommodation center, aiming to sell the remaining property inventory within two years[39](index=39&type=chunk) - **Future strategic deployment**: Upgrading technology enablement systems (targeting a **10% reduction in operating costs** within three years) and innovating industry-city integration models[40](index=40&type=chunk) - **Industry development trends**: Shifting from "selling space" to "empowering industries," from "heavy development" to "heavy operation," and from "earning price differences" to "growing together"[41](index=41&type=chunk) [2. Financial Review](index=20&type=section&id=2.%20%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's revenue grew, and loss attributable to owners narrowed significantly due to a disposal gain and tax credit, despite fair value losses Key Financial Review Data | Metric | 2025 (HK$ thousands) | 2024 (HK$ thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 148,849 | 93,698 | 58.9% | | Net loss attributable to Company owners | (6,100) | (25,800) | (76.4%) | | Net loss of the Group | (62,000) | (36,800) | 68.5% | | Gain on disposal of Ka Fung | 60,600 | – | N/A | | Income tax credit/(expense) | 23,100 | (2,700) | N/A (Expense to Credit) | | Decrease in gross profit | (19,900) | – | N/A | | Fair value loss on investment properties | 92,100 | – | N/A | | Impairment loss on properties held for sale | 12,700 | – | N/A | - Revenue was mainly derived from rental income and sales of commercial apartments and offices in Shenzhen, accounting for **5% and 91% of total revenue**, respectively[42](index=42&type=chunk) [3. Liquidity and Financial Resources](index=21&type=section&id=3.%20%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group's cash position improved, but net current liabilities widened, and the gearing ratio increased amid substantial interest-bearing borrowings Key Liquidity and Financial Resources Data | Metric | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 67,928 | 43,969 | 54.5% | | Total current assets | 385,801 | 529,482 | (27.2%) | | Total current liabilities | 794,834 | 884,723 | (10.2%) | | Total interest-bearing borrowings | 540,321 | 577,328 | (6.5%) | | Gearing ratio | 249% | 242% | 7 percentage points | - Interest-bearing borrowings are denominated in RMB with interest rates ranging from **4.35% to 12%** per annum[47](index=47&type=chunk) [4. Share Capital](index=22&type=section&id=4.%20%E8%82%A1%E6%9C%AC) The Group's share capital structure is unchanged, with new convertible bonds issued in May 2024 following the expiry of the old ones - The old convertible bonds **expired on 30 April 2024**, and the conversion rights ceased[48](index=48&type=chunk)[49](index=49&type=chunk) - The new convertible bonds were issued on 6 May 2024 with a principal amount of **HK$100,969,093.34**[50](index=50&type=chunk) - The conversion price for the new convertible bonds is **HK$2.6 per share**[51](index=51&type=chunk) - Upon full exercise of the conversion rights, the subscriber's shareholding would change from approximately **55.25% to 89.27%**[51](index=51&type=chunk) [5. Foreign Exchange Risk](index=24&type=section&id=5.%20%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA) The Group operates mainly in Hong Kong Dollar and Renminbi and currently does not have a foreign currency hedging policy - The main operating currencies are **Hong Kong Dollar and Renminbi**[52](index=52&type=chunk) - There is currently **no foreign currency hedging policy**, but the Group will monitor its foreign currency risk closely[52](index=52&type=chunk) [6. Treasury Policy](index=24&type=section&id=6.%20%E5%BA%AB%E5%8B%99%E6%94%BF%E7%AD%96) The Group maintains a prudent treasury policy, managing credit risk through customer assessments and monitoring liquidity to meet funding needs - A **prudent financial management treasury policy** is adopted to maintain an appropriate level of liquidity[53](index=53&type=chunk) - Credit risk is mitigated through credit evaluations, and liquidity levels are closely monitored to meet funding requirements[53](index=53&type=chunk) [7. Pledge of Group's Assets](index=25&type=section&id=7.%20%E9%9B%86%E5%9C%98%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) Certain properties in Shenzhen are pledged for bank loans, with the pledged amount decreasing from the previous year-end Pledge of Group's Assets | Metric | 30 June 2025 (HK$ thousands) | 31 December 2024 (HK$ thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Pledged bank loan amount | 456,392 | 502,380 | (9.1%) | [8. Segmental Information](index=25&type=section&id=8.%20%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) Detailed segmental information is provided in Note 4 to the condensed consolidated financial statements - Details of segmental information are set out in **Note 4** to the condensed consolidated financial statements[55](index=55&type=chunk) [9. Capital Commitments](index=25&type=section&id=9.%20%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) Information regarding the Group's significant capital commitments as of 30 June 2025 is pending - Information on the Group's significant commitments as of 30 June 2025 is **to be supplemented**[56](index=56&type=chunk)[57](index=57&type=chunk) [10. Employees](index=25&type=section&id=10.%20%E5%83%B1%E5%93%A1) The Group's employee count remained stable, while staff costs decreased due to reduced administrative activities and budget control - **Number of employees**: 111 (as at 30 June 2025 and 31 December 2024)[58](index=58&type=chunk) - **Number of directors**: 7 (as at 30 June 2025 and 31 December 2024)[58](index=58&type=chunk) Staff Costs | Metric | 2025 (HK$ thousands) | 2024 (HK$ thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Staff costs | 8,491 | 9,691 | (12.4%) | - The decrease in staff costs was mainly due to **reduced administrative activities and budget control** related to the Shenzhen Buji Zongke Cloud Port project[58](index=58&type=chunk) [11. Material Investments Held, Material Acquisitions and Disposals of Subsidiaries, and Future Plans for Material Investments or Capital Assets](index=26&type=section&id=11.%20%E6%89%80%E6%8C%81%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E3%80%81%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E4%BB%A5%E5%8F%8A%E6%9C%89%E9%97%9C%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E7%9A%84%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) The Group completed the disposal of a subsidiary and plans to expand its existing business while actively seeking M&A opportunities - Completed the disposal of **100% equity interest in Ka Fung Industrial Company Limited** on 30 June 2025 for a total consideration of RMB50,000[60](index=60&type=chunk) - **Future plans**: Continue to expand existing businesses, explore other business opportunities, and seek M&A transactions to diversify into new markets and revenue streams beyond property development[61](index=61&type=chunk) [12. Contingent Liabilities](index=26&type=section&id=12.%20%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) Detailed information on the Group's contingent liabilities is provided in Note 13 to the condensed consolidated financial statements - Details of contingent liabilities are set out in **Note 13** to the condensed consolidated financial statements[62](index=62&type=chunk) Other Information [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 reporting period - The Board **does not recommend the payment of an interim dividend** for the reporting period[63](index=63&type=chunk) [Purchase, Sale and Redemption of the Company's Listed Securities](index=27&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E5%8F%8A%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B9%8B%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period - Neither the Company nor any of its subsidiaries repurchased, sold, redeemed, or cancelled any of the Company's listed securities during the reporting period[64](index=64&type=chunk) [Corporate Governance](index=27&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Company complied with the Corporate Governance Code, except for the non-separation of the Chairman and CEO roles - Complied with the Corporate Governance Code, except that the roles of **Chairman and Chief Executive Officer were not separated** and the CEO position was vacant[65](index=65&type=chunk) - The Board believes there is an adequate balance of power and authority between the Board and management and will review the structure periodically[65](index=65&type=chunk) [Directors' Securities Transactions](index=28&type=section&id=%E8%91%A3%E4%BA%8B%E4%B9%8B%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) The Company has adopted a standard code for directors' securities transactions and is not aware of any non-compliance during the period - The Company has adopted the Model Code, and directors' securities transactions during the reporting period **complied with the required standards**[66](index=66&type=chunk) [Audit Committee](index=28&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, established in 1999, oversees financial reporting integrity and has reviewed the unaudited interim financial results - The Audit Committee was established on 4 August 1999, with duties including overseeing financial reporting integrity and reviewing accounting policies, financial controls, and risk management systems[67](index=67&type=chunk)[68](index=68&type=chunk) - The Audit Committee has reviewed with management the accounting principles and practices adopted by the Group and discussed financial reporting matters, including the review of the unaudited interim financial results for the period[69](index=69&type=chunk) [Events After the Reporting Period](index=29&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) No significant events occurred for the Group after the reporting period up to the date of this announcement - No significant post-reporting period events occurred for the Group up to the date of this announcement[70](index=70&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=29&type=section&id=%E5%88%8A%E7%99%BB%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%85%AC%E4%BD%88%E5%8F%8A%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) This announcement is available on the Company's and the Stock Exchange's websites, with the interim report to follow - This announcement is published on the Company's website (http://www.gfghl.com) and the Stock Exchange's website (http://www.hkex.com.hk)[71](index=71&type=chunk) - The interim report containing all required information will be dispatched to shareholders and made available on the websites in due course[71](index=71&type=chunk) [By Order of the Board](index=29&type=section&id=%E6%89%BF%E8%91%A3%E4%BA%8B%E6%9C%83%E5%91%BD) This announcement is signed by the Chairman, Mr Ma Hok Lim, on behalf of the Board of Directors - This announcement is signed by **Mr Ma Hok Lim, Chairman of the Board**[72](index=72&type=chunk) - The Board comprises four executive directors (Mr Ma Hok Lim, Mr Kwok Siu Bun, Ms Zhou Guihua, and Ms Kwok Siu Wa) and three independent non-executive directors (Mr Hui Pui Wai, Mr Liu Chiu Tung, and Mr Cui Muqin)[73](index=73&type=chunk)

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，概不對因本公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。 Renrui Human Resources Technology Holdings Limited 人瑞人才科技控股有限公司 （於開曼群島註冊成立之有限公司） （股份代號：6919） 截 至 2025 年 6 月 30 日 止 6 個 月 之中期業績公告 中期業績摘要 | | 截至6月30日止6個月 | | | | --- | --- | --- | --- | | | 2025年 | 2024年 | 變動 | | 業績 | 人民幣千元 | 人民幣千元 | | | | （未經審核） | （未經審核） | | | 附註1 收入 | 2,604,674 | 2,056,909 | 26.6% | | 附註1 毛利 | 191,903 | 172,801 | 11.1% | | 附註1 經營溢利 | 58,496 | 34,227 | 70.9% | | 期內溢利 | 32,553 | 20,393 | 5 ...

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 或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 China Risun Group Limited 中國旭陽集團有限公司 （於開曼群島註冊成立的有限公司） （股份代號： 1907） 截 至 2025年 6月 30日止六個月 未經審核中期業績公告 摘 要 中 國 旭 陽 集 團 有 限 公 司（「 本公司 」）董 事（「 董 事 」）會（「 董事會 」）欣 然 公 佈 本 公 司 及 其 附 屬 公 司（ 統 稱「 本集團 」）截 至 2025年 6月 30日 止 六 個 月（「 報告期 」或 「 本中期期間 」或「 本期間 」）的 未 經 審 核 綜 合 業 績 ， 連 同 截 至 2024年 6月 30日 止 六 個 月（「 上個期間 」）的 未 經 審 核 的 比 較 數 字 。 1 | | | | 截 至 6月 | 30日止六個月 | | --- | --- | --- | --- | --- | | | | | 2025年 | 2024年 | ...

[Condensed Consolidated Statement of Profit or Loss](index=1&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) The company achieved a turnaround from loss to profit in H1 2025, driven by fair value gains on equity investments Condensed Consolidated Statement of Profit or Loss (For the six months ended June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | Change (HK$'000) | | :--- | :--- | :--- | :--- | | Revenue | 15,502 | 14,259 | +1,243 | | Other income and gains | 28 | 284 | -256 | | Fair value changes of equity interests at FVTPL | 40,464 | (28,255) | +68,719 | | Administrative expenses | (12,792) | (14,381) | +1,589 | | Profit/(Loss) before tax | 43,202 | (28,093) | +71,295 | | Income tax expense | (2,638) | (2,690) | +52 | | Profit/(Loss) for the period | 40,564 | (30,783) | +71,347 | | Attributable to ordinary equity holders of the Company | 10,165 | (9,583) | +19,748 | | Basic earnings/(loss) per share | 1.32 HK cents | (1.25) HK cents | +2.57 HK cents | - The company **achieved a turnaround in H1 2025**, with profit for the period reaching **HK$40,564 thousand** compared to a loss of HK$30,783 thousand in the same period of 2024[2](index=2&type=chunk)[3](index=3&type=chunk) - Revenue saw a slight increase from HK$14,259 thousand to **HK$15,502 thousand**, primarily due to a significant gain from the fair value change of equity interests at FVTPL, which reversed from a loss[2](index=2&type=chunk) [Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The company's total comprehensive income improved significantly, supported by positive foreign exchange differences Condensed Consolidated Statement of Comprehensive Income (For the six months ended June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | Change (HK$'000) | | :--- | :--- | :--- | :--- | | Profit/(Loss) for the period | 40,564 | (30,783) | +71,347 | | Exchange differences on translation of foreign operations | 6,147 | (4,644) | +10,791 | | Total comprehensive income/(expense) for the period | 46,711 | (35,427) | +82,138 | | Attributable to ordinary equity holders of the Company | 19,051 | (16,543) | +35,594 | - The company recorded a **total comprehensive income of HK$46,711 thousand** in H1 2025, a significant improvement from the total comprehensive expense of HK$35,427 thousand in the prior-year period[5](index=5&type=chunk) - Exchange differences in other comprehensive income turned from a negative HK$4,644 thousand in H1 2024 to a **positive HK$6,147 thousand** in H1 2025, contributing significantly to comprehensive income[5](index=5&type=chunk) [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) The company's total assets and net assets grew, primarily driven by an increase in the value of non-current equity investments Condensed Consolidated Statement of Financial Position (As at June 30) | Metric | June 30, 2025 (HK$'000) | Dec 31, 2024 (HK$'000) | Change (HK$'000) | | :--- | :--- | :--- | :--- | | Total non-current assets | 1,370,633 | 1,317,420 | +53,213 | | Of which: Equity interests at FVTPL | 1,015,157 | 974,693 | +40,464 | | Total current assets | 81,631 | 86,091 | -4,460 | | Total current liabilities | (70,225) | (65,802) | -4,423 | | Net current assets | 11,406 | 20,289 | -8,883 | | Total assets less current liabilities | 1,382,039 | 1,337,709 | +44,330 | | Net assets | 1,024,837 | 978,126 | +46,711 | | Total equity | 1,024,837 | 978,126 | +46,711 | - As of June 30, 2025, the company's **total assets increased to HK$1,452,264 thousand** and **net assets grew to HK$1,024,837 thousand**, both showing growth compared to December 31, 2024[6](index=6&type=chunk)[7](index=7&type=chunk) - Equity interests at FVTPL within non-current assets **increased significantly by HK$40,464 thousand** to HK$1,015,157 thousand[6](index=6&type=chunk) - Net current assets **decreased from HK$20,289 thousand to HK$11,406 thousand**[6](index=6&type=chunk) [Notes](index=6&type=section&id=%E9%99%84%E8%A8%BB) [1. Basis of Preparation and Principal Accounting Policies](index=6&type=section&id=1.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E5%8F%8A%E4%B8%BB%E8%A6%81%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) The condensed consolidated financial statements are prepared in accordance with HKAS 34 and should be read with the annual financial statements - The condensed consolidated financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting" issued by the HKICPA and the disclosure requirements of the Listing Rules[8](index=8&type=chunk) - These statements do not include all information required for annual financial statements and should be read in conjunction with the 2024 annual consolidated financial statements[8](index=8&type=chunk) [1.1 Changes in Accounting Policies](index=6&type=section&id=1.1%20%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96%E4%B9%8B%E8%AE%8A%E5%8B%95) The company adopted the amended HKAS 21 "Lack of Exchangeability" with no material impact on its financial position or performance - The company adopted the amended HKFRS Accounting Standard HKAS 21 "Lack of Exchangeability" for the first time[10](index=10&type=chunk) - The change in accounting policy had **no material impact** on the results and financial position prepared and presented for the current or prior periods[10](index=10&type=chunk) [2. Operating Segment Information](index=7&type=section&id=2.%20%E7%B6%93%E7%87%9F%E5%88%86%E9%A1%9E%E8%B3%87%E6%96%99) The Group operates in two segments, property investment and development, and corporate, with revenue primarily from Mainland China - The Group has two reportable operating segments: Property Investment and Development (leasing and selling properties in Mainland China) and Corporate and Others (providing management services)[11](index=11&type=chunk)[15](index=15&type=chunk) - Over 90% of revenue is derived from customers in Mainland China, hence no geographical segment information is presented[12](index=12&type=chunk) - Revenue from a single customer, Customer A, amounted to **HK$15,502,000** (2024: HK$14,259,000), exceeding 10% of the Group's total revenue[14](index=14&type=chunk) Revenue and Results by Operating Segment (For the six months ended June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Revenue from Property Investment and Development | 15,502 | 14,259 | | Results from Property Investment and Development | 51,328 | (17,531) | | Results from Corporate and Others | (8,154) | (10,846) | | Total revenue from external customers | 15,502 | 14,259 | [3. Profit/(Loss) Before Tax](index=8&type=section&id=3.%20%E7%A8%85%E5%89%8D%E6%BA%A2%E5%88%A9%EF%B9%95%EF%BC%88%E8%99%A7%E6%90%8D%EF%BC%89) The profit before tax was mainly driven by a significant fair value gain on equity interests, reversing last year's loss Components of Profit/(Loss) Before Tax (For the six months ended June 30) | Item | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 168 | 169 | | Fair value changes of equity interests at FVTPL | (40,464) | 28,255 | | Interest income | (28) | (68) | - The fair value change of equity interests at FVTPL shifted from a loss of HK$28,255 thousand in H1 2024 to a **gain of HK$40,464 thousand** in H1 2025, being the primary reason for the turnaround in pre-tax profit[16](index=16&type=chunk) [4. Income Tax](index=8&type=section&id=4.%20%E6%89%80%E5%BE%97%E7%A8%85) The Group's income tax expense primarily arose from Mainland China, with no provision made for Hong Kong profits tax Income Tax Expense (For the six months ended June 30) | Item | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Current - Mainland China Enterprise Income Tax | 1,967 | 1,924 | | Deferred tax | 671 | 766 | | Total tax charge for the period | 2,638 | 2,690 | - Subsidiaries established in Mainland China are subject to an income tax rate of **25%**[17](index=17&type=chunk) - No provision for Hong Kong profits tax has been made as the Group did not generate any assessable profits in Hong Kong during the period[19](index=19&type=chunk) [5. Interim Dividend](index=8&type=section&id=5.%20%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board of Directors does not recommend the payment of an interim dividend for the period - The Board does not recommend the payment of an interim dividend for the period (2024: Nil)[18](index=18&type=chunk) [6. Earnings/(Loss) Per Share Attributable to Ordinary Equity Holders of the Company](index=9&type=section&id=6.%20%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%99%AE%E9%80%9A%E8%82%A1%E6%AC%8A%E7%9B%8A%E6%8C%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%94%E6%AF%8F%E8%82%A1%E6%BA%A2%E5%88%A9%EF%B9%95%EF%BC%88%E8%99%A7%E6%90%8D%EF%BC%89) Basic earnings per share was 1.32 HK cents, a turnaround from a loss per share of 1.25 HK cents in the prior year period Calculation of Earnings/(Loss) Per Share (For the six months ended June 30) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit/(Loss) attributable to ordinary equity holders | HK$10,165,000 | (HK$9,583,000) | | Number of ordinary shares in issue | 768,616,520 shares | 768,616,520 shares | | Basic earnings/(loss) per share | 1.32 HK cents | (1.25) HK cents | - There were no potential dilutive ordinary shares in issue during the current and prior periods[21](index=21&type=chunk) [7. Trade Receivables](index=9&type=section&id=7.%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) Total trade receivables decreased as of June 30, 2025, with all balances due within 6 months Ageing Analysis of Trade Receivables (As at June 30) | Ageing | June 30, 2025 (HK$'000) | Dec 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Within 6 months | 13,343 | 13,997 | | Over 6 months but less than 1 year | – | 6,862 | | Total | 13,343 | 20,859 | - The Group generally grants credit periods of 3 to 12 months to its customers; trade receivables are interest-free and unsecured[22](index=22&type=chunk) [8. Trade Payables](index=9&type=section&id=8.%20%E8%B2%BF%E6%98%93%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) Total trade payables increased slightly as of June 30, 2025, with all balances aged over one year Ageing Analysis of Trade Payables (As at June 30) | Ageing | June 30, 2025 (HK$'000) | Dec 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Over 1 year | 1,914 | 1,844 | | Total | 1,914 | 1,844 | - Trade payables are interest-free and aged based on the date of receipt of goods or services[23](index=23&type=chunk) [9. Equity Interest in an Entity at Fair Value Through Profit or Loss](index=10&type=section&id=9.%20%E6%8C%89%E5%85%AC%E5%85%81%E5%83%B9%E5%80%BC%E8%A8%88%E5%85%A5%E6%90%8D%E7%9B%8A%E4%B9%8B%E4%B8%80%E9%96%93%E5%AF%A6%E9%AB%94%E7%9A%84%E8%82%A1%E6%9C%AC%E6%AC%8A%E7%9B%8A) The fair value of the company's equity interest in Guangzhou Zhengda increased significantly, turning from a loss to a gain Movement in Carrying Amount of Equity Interest at FVTPL | Item | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Carrying amount at January 1 | 974,693 | 1,030,472 | | Fair value change recognised in profit or loss | 40,464 | (28,255) | | Carrying amount at June 30 | 1,015,157 | 1,002,217 | - The fair value change recognised in the profit or loss for the period was a **gain of HK$40,464 thousand**, compared to a loss of HK$28,255 thousand in the prior-year period[24](index=24&type=chunk) [Financial Review](index=11&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) [Financial Performance Overview](index=11&type=section&id=%E8%B2%A1%E5%8B%99%E8%A1%A8%E7%8F%BE%E6%A6%82%E8%A6%BD) The company's revenue grew slightly, achieving a profit attributable to equity holders and reversing the prior year's loss Key Financial Performance (For the six months ended June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Revenue | 15,502 | 14,259 | | Profit/(Loss) attributable to ordinary equity holders | 10,165 | (9,583) | - The Group's turnover did not experience any significant changes during the period[25](index=25&type=chunk) [Adjusted EBITDA](index=11&type=section&id=%E7%B6%93%E8%AA%BF%E6%95%B4EBITDA) Adjusted EBITDA increased significantly due to lower administrative expenses compared to the prior period Adjusted EBITDA (For the six months ended June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Adjusted EBITDA | 2,906 (Profit) | 331 (Profit) | - The increase in EBITDA was due to a **decrease in administrative expenses**, as the previous period incurred additional professional fees for the delayed publication of results[26](index=26&type=chunk) - Adjusted EBITDA excludes the effects of fair value changes of investment properties, loss on derecognition of a then subsidiary, and fair value changes of equity interest at FVTPL[26](index=26&type=chunk) [Net Profit](index=11&type=section&id=%E6%B7%A8%E6%BA%A2%E5%88%A9) The company shifted from a pre-tax loss to a pre-tax profit, driven by a non-cash gain from fair value changes in equity interests Net Profit (For the six months ended June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Profit/(Loss) before tax | 43,202 | (28,093) | | Profit/(Loss) after tax | 40,564 | (30,783) | | Fair value gain/(loss) on equity interest | 40,464 | (28,255) | - The company's turnaround from a pre-tax loss to a pre-tax profit was mainly due to a **fair value gain of HK$40,464 thousand** on its equity interest[27](index=27&type=chunk) - This fair value gain is a **non-cash transaction**, primarily resulting from the appreciation of the Renminbi, which generated a gain upon translation to Hong Kong dollars[27](index=27&type=chunk) [Liquidity and Financial Resources](index=12&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group's operations are funded by operating cash flow, with stable cash balances and a low gearing ratio Liquidity and Financial Resources (As at June 30) | Metric | H1 2025 (HK$'000) | H1 2024 (HK$'000) | | :--- | :--- | :--- | | Net cash from/(used in) operating activities | 6,026 (inflow) | 3,658 (outflow) | | Cash and bank balances (end of period) | 63,564 | 63,573 | - As of June 30, 2025, the Group's **gearing ratio was 0.10**, remaining at a relatively low level and consistent with December 31, 2024[29](index=29&type=chunk) - The Group's financial resources are sufficient to meet its capital expenditure and working capital requirements for the next twelve months[29](index=29&type=chunk) [Assets](index=12&type=section&id=%E8%B3%87%E7%94%A2) The Group's net assets and total assets increased as of June 30, 2025, while net current assets decreased Asset Position (As at June 30) | Metric | June 30, 2025 (HK$'000) | Dec 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Net current assets | 11,406 | 20,289 | | Net assets | 1,024,837 | 978,126 | | Total assets | 1,452,264 | 1,403,511 | [Foreign Exchange Risk](index=12&type=section&id=%E5%8C%AF%E7%8E%87%E9%A2%A8%E9%9A%AA) The Group faces currency risk between RMB and HKD but has not implemented hedging measures due to past stability - The Group's main operations are in Mainland China, with financial statements of operating subsidiaries presented in RMB, creating foreign exchange risk upon consolidation into HKD[31](index=31&type=chunk) - Given the relatively stable exchange rate between RMB and HKD in previous years, the Group has not used forward contracts or foreign currency swap instruments[31](index=31&type=chunk) [Significant Investments](index=13&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87) The Group's equity interest in Guangzhou Zhengda constitutes a significant investment, accounting for approximately 70% of total assets Significant Investment (As at June 30) | Metric | June 30, 2025 (HK$'000) | Dec 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Equity interest at FVTPL | 1,015,157 | 974,693 | | Percentage of Group's total assets | Approx. 70% | Approx. 70% | | Fair value gain/(loss) | 40,464 | (28,255) | - This investment is held by Hong Kong Zhengda (a 25%-owned subsidiary of the Group), which directly holds the entire equity of Guangzhou Zhengda[32](index=32&type=chunk) [Pledge of Assets](index=13&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2025, none of the Group's assets were pledged - As of June 30, 2025, none of the Group's assets were pledged (December 31, 2024: Nil)[33](index=33&type=chunk) [Contingent Liabilities](index=13&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities (December 31, 2024: Nil)[34](index=34&type=chunk) [Update on Use of Proceeds](index=13&type=section&id=%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E7%94%A8%E9%80%94%E6%9B%B4%E6%96%B0) The portion of proceeds for general working capital has been fully utilized, while the use of funds for the Guangzhou project is being reassessed Use of Net Proceeds from New Share Issuance (As at June 30, 2025) | Intended Use | Net Proceeds (HK$ million) | Utilised (HK$ million) | Unutilised (HK$ million) | Expected Utilisation Time | | :--- | :--- | :--- | :--- | :--- | | Guangzhou reconstruction project costs | 12.0 | – | 12.0 | On or before June 30, 2027 | | General working capital | 4.1 | 4.1 | – | – | | Total | 16.1 | 4.1 | 12.0 | | - Following the de-consolidation of Guangzhou Zhengda, the Board will consider reallocating the **HK$12,000,000** originally intended for its reconstruction project[36](index=36&type=chunk) - As of June 30, 2025, the unutilized net proceeds were held as short-term bank deposits[37](index=37&type=chunk) [Issue of Equity Securities](index=14&type=section&id=%E7%99%BC%E8%A1%8C%E8%82%A1%E6%9C%AC%E8%AD%89%E5%88%B8) The company did not issue any equity securities or sell treasury shares during the period - During the period, the Company did not issue any equity securities (including securities convertible into equity securities) or sell treasury shares for cash[38](index=38&type=chunk) [Business Review](index=15&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) [Property Investment](index=15&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) The Group's Gang Yu Plaza property in Chongqing provides a stable cash flow with high occupancy rates - The Group's property interest in Chongqing is located at Chaotianmen, with Gang Yu Plaza having a total GFA of approximately 24,200 sq.m., primarily for wholesale and retail of menswear and footwear[40](index=40&type=chunk) - Gang Yu Plaza is **almost fully occupied** with an acceptable tenant turnover rate, providing a stable cash flow that largely meets the Group's working capital needs[40](index=40&type=chunk) - The Board is confident that the property will continue to provide a relatively stable income for the Group in the foreseeable future[40](index=40&type=chunk) [Property Development](index=15&type=section&id=%E7%89%A9%E6%A5%AD%E7%99%BC%E5%B1%95) The Guangzhou redevelopment project is planned as a high-end commercial complex, but its start date is delayed due to a winding-up petition - The property in Yuexiu District, Guangzhou (formerly Guangzhou Metropolis Shoes City) is planned to be developed into a high-end commercial complex with twin towers and a 3-level basement, totaling a GFA of approximately 234,000 sq.m[41](index=41&type=chunk)[42](index=42&type=chunk) - The redevelopment is expected to take about four years, with the first phase completing by the end of 2029 and the final phase in Q1 2031[42](index=42&type=chunk) - The new commercial complex is expected to open and generate rental income for the Group as early as the beginning of 2030[42](index=42&type=chunk) [Properties Held for Sale](index=16&type=section&id=%E6%8C%81%E4%BD%9C%E9%8A%B7%E5%94%AE%E7%89%A9%E6%A5%AD) Guangzhou Zhengda holds approximately 190 residential units for temporary resettlement, which are currently vacant or available for sale - Guangzhou Zhengda (a former subsidiary) owns approximately 190 residential units with a total GFA of about 11,000 sq.m[43](index=43&type=chunk) - These units were built in the late 1990s for temporary resettlement of owners displaced by development but remain vacant or available for spot sale[43](index=43&type=chunk) [Winding-up Petition against Guangzhou Zhengda](index=16&type=section&id=%E5%B0%8D%E5%BB%A3%E5%B7%9E%E6%AD%A3%E5%A4%A7%E7%9A%84%E6%B8%85%E7%AE%97%E5%91%88%E8%AB%8B) Guangzhou Zhengda faces a winding-up petition, which management believes lacks legal basis and is actively seeking its dismissal [Background and Progress of the "Winding-up Petition"](index=16&type=section&id=%E3%80%8C%E6%B8%85%E7%AE%97%E5%91%88%E8%AB%8B%E3%80%8D%E4%B9%8B%E8%83%8C%E6%99%AF%E5%8F%8A%E9%80%B2%E5%B1%95) The petition, initiated in 2009, has seen legal reversals, with management contesting the legitimacy of the proceedings - Yue Fang Si Qi filed a contentious winding-up petition against Guangzhou Zhengda in 2009, despite not being a registered shareholder or verified creditor[44](index=44&type=chunk) - The Guangzhou Intermediate Court dismissed the petition in May 2021, but the Guangdong High Court overturned this decision in May 2023, ordering a retrial[45](index=45&type=chunk) - In August 2023, a new liquidator was appointed for another compulsory liquidation, which Guangzhou Zhengda has lawfully refused to cooperate with[45](index=45&type=chunk) - Guangzhou Zhengda's business continues to operate normally, and it was granted a "Demolition Permit" in December 2024 to proceed with resettlement work in 2025[46](index=46&type=chunk)[48](index=48&type=chunk) [Management's Statement](index=18&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%81%B2%E6%98%8E) The Board maintains that the petition is legally flawed and that management remains in control of operations - The Board believes the petitioner lacks the legal standing to file for liquidation and that the alleged event of default, "voluntary dissolution," never occurred[50](index=50&type=chunk) - The liquidation proceedings initiated in 2009 are legally contentious, and the new liquidator has been unable to enforce the flawed liquidation[50](index=50&type=chunk) - Guangzhou Zhengda's management **remains in control of its operations, assets, accounts, and company seals**, and will petition the court to dismiss the application again[50](index=50&type=chunk) [Update on a Major Acquisition](index=19&type=section&id=%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E4%BA%8B%E9%A0%85%E4%B9%8B%E8%BF%91%E6%B3%81%E7%B0%A1%E5%A0%B1) The Group has extended the long stop date for a major acquisition to June 30, 2026, to finalize amended terms - The Group signed a new extension agreement on June 24, 2024, to **extend the long stop date for a major acquisition to June 30, 2026**, aiming to agree on revised terms[51](index=51&type=chunk) - If an amended timetable is agreed, the acquisition is expected to be funded through a combination of debt financing, equity financing, bank borrowings, or private equity funds[51](index=51&type=chunk) - The Company reiterates its confidence that the winding-up petition will be ruled invalid or dismissed within the foreseeable future (e.g., approximately two years)[51](index=51&type=chunk) [Outlook](index=19&type=section&id=%E5%B1%95%E6%9C%9B) The Group has weathered the real estate market downturn with a low gearing ratio and plans to advance its redevelopment projects - The Group survived the turmoil in Mainland China's real estate market by adhering to a low-leverage principle, maintaining a **gearing ratio of only 0.1** during the period[52](index=52&type=chunk) - While China's property market has not yet bottomed out, the market shows polarization with prime luxury properties selling out quickly[52](index=52&type=chunk) - The Guangzhou redevelopment project timeline is **delayed by one year** due to incomplete demolition and legal disputes, with full commencement now expected in early 2028[53](index=53&type=chunk) - The Group intends to redevelop its stable shopping mall in Chongqing after the completion of the Guangzhou project[53](index=53&type=chunk) - The Group will focus on dismissing the winding-up petition and exploring investment opportunities in "new quality productive forces," including a potential new segment for photovoltaic solutions in the Greater Bay Area[54](index=54&type=chunk) [Other Information](index=21&type=section&id=%E5%85%B6%E4%BB%96%E4%BF%A1%E6%81%AF) [National Security Law in Hong Kong and the National Games](index=21&type=section&id=%E9%A6%99%E6%B8%AF%E5%9C%8B%E5%AE%B6%E5%AE%89%E5%85%A8%E6%B3%95%E5%8F%8A%E5%85%A8%E5%9C%8B%E9%81%8B%E5%8B%95%E6%9C%83) The Board supports the HKSAR Government's governance and congratulates Hong Kong on successfully hosting the National Games - The Board fully supports the HKSAR Government in governing according to the law[55](index=55&type=chunk) - The Board congratulates Hong Kong on the success of hosting the National Games events for the first time[56](index=56&type=chunk) [Employees and Remuneration Policy](index=21&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E9%85%AC%E9%87%91%E6%94%BF%E7%AD%96) The Group maintains a stable workforce with slightly lower staff costs, offering competitive remuneration and benefits Employee and Remuneration Information | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Number of employees | Approx. 20 | 20 | | Total staff costs (for the period) | HK$3,767,000 | HK$3,870,000 | - The Group offers competitive remuneration packages benchmarked against the market, including medical insurance, provident fund contributions, and discretionary bonuses based on performance[57](index=57&type=chunk) - The Group continuously provides adequate training and development resources for its employees[57](index=57&type=chunk) [Corporate Governance Practices](index=21&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The Board believes the company has complied with the Corporate Governance Code throughout the period - The Board is of the view that the Company has complied with the code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules for the entire period[58](index=58&type=chunk) [Model Code for Securities Transactions](index=21&type=section&id=%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E4%B9%8B%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87) The company has adopted the Model Code for securities transactions and confirms directors' compliance - The Company has adopted the Model Code for Securities Transactions by Directors as set out in Appendix C3 to the Listing Rules as its code of conduct for securities transactions by directors[59](index=59&type=chunk) - Upon specific enquiry, the Company confirmed that all directors have complied with the required standards set out in the code during the period[59](index=59&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=22&type=section&id=%E8%B2%B7%E8%B3%A3%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the period - During the period, neither the Company nor any of its subsidiaries purchased, sold or redeemed any of the Company's listed securities[60](index=60&type=chunk) [Review by Audit Committee](index=22&type=section&id=%E7%94%B1%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83%E5%AF%A9%E9%96%B1) The Group's unaudited interim financial statements have been reviewed by the Audit Committee - The Group's unaudited condensed consolidated financial statements for the period have been reviewed by the Company's Audit Committee[61](index=61&type=chunk) [Publication of Interim Report for the six months ended 30 June 2025](index=22&type=section&id=%E5%88%8A%E7%99%BB%E6%88%AA%E8%87%B3%E4%BA%8C%E9%9B%B6%E4%BA%8C%E4%BA%94%E5%B9%B4%E5%85%AD%E6%9C%88%E4%B8%89%E5%8D%81%E6%97%A5%E6%AD%A2%E5%85%AD%E5%80%8B%E6%9C%88%E4%B9%8B%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) The interim report will be dispatched to shareholders and published on the HKEX and company websites - The interim report for the six months ended 30 June 2025 will be dispatched to shareholders and published on the websites of HKEX (www.hkex.com.hk) and the Company (https://www.irasia.com/listco/hk/zhonghua) as soon as practicable[62](index=62&type=chunk)

[Summary](index=1&type=section&id=Summary) [Financial Summary](index=1&type=section&id=Financial%20Summary) For the six months ended June 30, 2025, China Huirong Financial Holdings Limited's operating revenue decreased by 2% year-on-year, while profit attributable to owners of the Company increased by 7%; total assets and loans to customers decreased, while bank balances and cash on hand increased | Metric | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | **Operating Results** | | | | | Operating Revenue | 345,814 | 351,380 | -2% | | Operating Costs | 221,387 | 211,488 | 5% | | Profit attributable to owners of the Company | 32,762 | 30,609 | 7% | | Basic Earnings Per Share (RMB) | 0.030 | 0.028 | 7% | | **Financial Position** | | | | | Total Assets | 3,319,707 | 3,504,127 | -5% | | Total Liabilities | 1,118,343 | 1,301,438 | -14% | | Loans to Customers | 2,375,043 | 2,517,986 | -6% | | Bank Balances and Cash on Hand | 164,877 | 147,893 | 11% | | Net Assets | 2,201,364 | 2,202,689 | 0% | [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) [Interim Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group's operating revenue was **RMB 345,814 thousand**, a 2% year-on-year decrease, with profit for the period at **RMB 40,004 thousand**, a 6% decrease, while profit attributable to owners of the Company increased by 7% to **RMB 32,762 thousand** | Metric | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest Income | 138,907 | 166,677 | | Revenue from Sales of Goods | 198,174 | 183,556 | | Operating Revenue | 345,814 | 351,380 | | Operating Costs | (221,387) | (211,488) | | Credit Impairment Losses | (68,424) | (46,136) | | Profit Before Income Tax | 49,540 | 57,157 | | Profit for the Period | 40,004 | 42,575 | | Profit attributable to owners of the Company | 32,762 | 30,609 | | Basic Earnings Per Share (RMB) | 0.030 | 0.028 | - The proportion of profit for the period attributable to owners of the Company increased from **71.9% in 2024** to **81.9% in 2025**, with a decrease in profit attributable to non-controlling interests[4](index=4&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were **RMB 3,319,707 thousand**, a 5% decrease from December 31, 2024; total liabilities were **RMB 1,118,343 thousand**, a 14% decrease; total equity remained stable, with a slight decrease of 0.06% | Metric | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | **Assets** | | | | Total Non-current Assets | 672,899 | 635,941 | | Total Current Assets | 2,646,808 | 2,868,186 | | Total Assets | 3,319,707 | 3,504,127 | | **Equity and Liabilities** | | | | Equity attributable to owners of the Company | 1,899,843 | 1,913,619 | | Non-controlling Interests | 301,521 | 289,070 | | Total Equity | 2,201,364 | 2,202,689 | | Total Non-current Liabilities | 228,555 | 354,935 | | Total Current Liabilities | 889,788 | 946,503 | | Total Liabilities | 1,118,343 | 1,301,438 | - Current portion of loans to customers decreased by approximately **6.7%** from **RMB 2,255,454 thousand** at December 31, 2024, to **RMB 2,103,928 thousand** at June 30, 2025[5](index=5&type=chunk) - Bank balances and cash on hand increased by approximately **11.5%** from **RMB 147,893 thousand** at December 31, 2024, to **RMB 164,877 thousand** at June 30, 2025[5](index=5&type=chunk) [Notes to the Interim Condensed Consolidated Financial Information](index=6&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) [1. General Information](index=6&type=section&id=1.%20General%20Information) China Huirong Financial Holdings Limited, incorporated in the Cayman Islands, primarily provides secured and unsecured loan services to customers in China, with its shares listed on the Hong Kong Stock Exchange in October 2013 and financial information presented in RMB - The Company is an investment holding company primarily providing secured and unsecured loan services in China[7](index=7&type=chunk) - The Company's shares were listed on The Stock Exchange of Hong Kong Limited on **October 28, 2013**[7](index=7&type=chunk) [2. Basis of Preparation](index=6&type=section&id=2.%20Basis%20of%20Preparation) The interim condensed consolidated financial information is prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the HKICPA and on a going concern basis - The interim financial information is prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting'[8](index=8&type=chunk) - The Group continues to prepare its financial information on a going concern basis[9](index=9&type=chunk) [3. Significant Accounting Policies](index=6&type=section&id=3.%20Significant%20Accounting%20Policies) The Group's accounting policies are consistent with the 2024 consolidated financial statements, with the first-time application of HKAS 21 amendments on January 1, 2025, having no retrospective adjustment, while HKFRS 18, effective January 1, 2027, is expected to significantly impact financial statement presentation and disclosure - Accounting policies are consistent with the 2024 consolidated financial statements[10](index=10&type=chunk) - The first-time application of HKAS 21 amendments 'Lack of Exchangeability' from **January 1, 2025**, did not result in changes to accounting policies or retrospective adjustments[11](index=11&type=chunk) - HKFRS 18, effective **January 1, 2027**, is expected to significantly impact the presentation and disclosure of financial statements, and management is currently assessing its effects[12](index=12&type=chunk)[13](index=13&type=chunk) [4. Critical Accounting Estimates and Judgments](index=7&type=section&id=4.%20Critical%20Accounting%20Estimates%20and%20Judgments) The significant judgments and key sources of estimation uncertainty applied by management in preparing the interim financial information are consistent with those used in the 2024 consolidated financial statements - Key accounting estimates and judgments are consistent with the 2024 consolidated financial statements[14](index=14&type=chunk) [5. Segment Information](index=7&type=section&id=5.%20Segment%20Information) The Group's operations are divided into Inclusive Finance and Ecosystem Finance business segments, with the former primarily offering loan services and the latter covering supply chain technology, tech-enabled lending, factoring, insurance brokerage, and equity investment businesses; in the first half of 2025, both segments saw a decrease in profit before tax, while external operating revenue for Ecosystem Finance increased - The Group's business is divided into Inclusive Finance Business Segment and Ecosystem Finance Business Segment[15](index=15&type=chunk)[16](index=16&type=chunk)[17](index=17&type=chunk) Segment Performance | Metric (RMB thousands) | Inclusive Finance Business Segment (2025) | Ecosystem Finance Business Segment (2025) | Inclusive Finance Business Segment (2024) | Ecosystem Finance Business Segment (2024) | | :--- | :--- | :--- | :--- | :--- | | External Operating Revenue | 107,945 | 230,652 | 117,293 | 227,147 | | Profit/(Loss) Before Income Tax | 23,222 | 11,726 | 46,822 | 23,645 | | Segment Assets | 1,406,889 | 1,261,267 | 1,643,397 | 1,337,055 | | Segment Liabilities | (184,014) | (533,813) | (262,685) | (599,691) | [6. Interest Income](index=10&type=section&id=6.%20Interest%20Income) For the six months ended June 30, 2025, the Group's total interest income was **RMB 138,907 thousand**, a decrease from **RMB 161,906 thousand** in the prior period, primarily due to a significant drop in interest income from secured loans to customers, partially offset by a substantial increase from unsecured loans to customers Interest Income by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Secured Loans to Customers | 54,457 | 96,718 | | Unsecured Loans to Customers | 80,553 | 48,155 | | Interest Income from Financial Assets Purchased Under Resale Agreements | 3,351 | 16,524 | | Interest Income from Bank Deposits | 546 | 509 | | **Total** | **138,907** | **161,906** | - Interest income from secured loans to customers decreased by **43.7%** year-on-year, while interest income from unsecured loans to customers increased by **67.3%** year-on-year[22](index=22&type=chunk) [7. Revenue from Sales of Goods and Cost of Sales](index=10&type=section&id=7.%20Revenue%20from%20Sales%20of%20Goods%20and%20Cost%20of%20Sales) The Group's sales of goods primarily include electronic products and daily necessities - Sales of goods primarily consist of electronic products and daily necessities[23](index=23&type=chunk) [8. Interest Expenses](index=10&type=section&id=8.%20Interest%20Expenses) For the six months ended June 30, 2025, the Group's total interest expenses decreased by **17%** to **RMB 24,571 thousand** from **RMB 29,582 thousand** in the prior period, mainly due to a significant reduction in interest expenses on micro-loan company borrowings Interest Expenses by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest Expenses on Bank Borrowings | 15,755 | 15,268 | | Interest Expenses on Micro-loan Company Borrowings | 679 | 3,900 | | Interest Expenses on Other Borrowings | 8,005 | 10,075 | | Other Interest Expenses | 132 | 339 | | **Total** | **24,571** | **29,582** | - Interest expenses on micro-loan company borrowings decreased by **82.6%** year-on-year[24](index=24&type=chunk) [9. Net Investment Income/(Loss)](index=10&type=section&id=9.%20Net%20Investment%20Income%2F%28Loss%29) For the six months ended June 30, 2025, the Group's net investment income significantly decreased to **RMB 6 thousand** from **RMB 1,218 thousand** in the prior period, primarily due to the absence of net gains on disposal of financial assets this period Net Investment Income/(Loss) by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Gains/(Losses) from Fair Value Changes | — | (516) | | Net (Loss)/Gain on Disposal of Financial Assets | — | 1,734 | | Others | 6 | — | | **Total** | **6** | **1,218** | [10. Credit Impairment Losses](index=11&type=section&id=10.%20Credit%20Impairment%20Losses) For the six months ended June 30, 2025, the Group's credit impairment losses increased by **48.3%** to **RMB 68,424 thousand** from **RMB 46,136 thousand** in the prior period, with credit impairment losses on loans to customers being the primary driver of this increase Credit Impairment Losses by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Credit Impairment Losses on Loans to Customers | 70,382 | 40,495 | | Credit Impairment Losses on Financial Guarantees | 1,569 | 2,276 | | Credit Impairment Losses on Financial Assets Purchased Under Resale Agreements | (3,527) | 3,365 | | **Total** | **68,424** | **46,136** | - Credit impairment losses on loans to customers increased by **73.8%** year-on-year[25](index=25&type=chunk) [11. Other Operating Income](index=11&type=section&id=11.%20Other%20Operating%20Income) For the six months ended June 30, 2025, the Group's other operating income significantly increased to **RMB 28,197 thousand** from **RMB 5,548 thousand** in the prior period, primarily driven by net gains on disposal of assets taken over in settlement of debts Other Operating Income by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Gain/(Loss) on Disposal of Assets Taken Over in Settlement of Debts | 21,748 | (127) | | Rental Income | 4,979 | 4,971 | | Others | 1,470 | 704 | | **Total** | **28,197** | **5,548** | - The shift from a net loss on disposal of assets taken over in settlement of debts in the prior period to a net gain in the current period is the main reason for the significant increase in other operating income[25](index=25&type=chunk) [12. Other Losses, Net](index=11&type=section&id=12.%20Other%20Losses%2C%20Net) For the six months ended June 30, 2025, the Group's other losses, net, decreased to **RMB 126 thousand** from **RMB 186 thousand** in the prior period, despite an increase in net exchange losses, due to higher government grants Other Losses, Net by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Exchange Losses | (396) | (266) | | Government Grants | 270 | 80 | | **Total** | **(126)** | **(186)** | [13. Income Tax Expense](index=11&type=section&id=13.%20Income%20Tax%20Expense) For the six months ended June 30, 2025, the Group's income tax expense decreased by **34.6%** to **RMB 9,536 thousand** from **RMB 14,582 thousand** in the prior period, primarily due to a deferred tax credit and other adjustments Income Tax Expense by Category | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Current Income Tax | 13,402 | 15,395 | | Deferred Income Tax | (3,866) | (813) | | **Total** | **9,536** | **14,582** | - Deferred income tax shifted from a debit in the prior period to a credit in the current period, positively impacting income tax expense[25](index=25&type=chunk) - The Group is exempt from income tax in the Cayman Islands and British Virgin Islands, subject to a **16.5%** profits tax rate in Hong Kong, and a **25%** corporate income tax rate in mainland China, with preferential tax rates for small and micro-enterprises[26](index=26&type=chunk)[27](index=27&type=chunk) [14. Earnings Per Share](index=13&type=section&id=14.%20Earnings%20Per%20Share) For the six months ended June 30, 2025, the Group's basic and diluted earnings per share both increased to **RMB 0.030** from **RMB 0.028** in the prior period, primarily due to an increase in profit attributable to owners of the Company, while the weighted average number of ordinary shares remained unchanged Earnings Per Share Details | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company (RMB thousands) | 32,762 | 30,609 | | Weighted Average Number of Ordinary Shares in Issue (thousands) | 1,090,335 | 1,090,335 | | Basic Earnings Per Share (RMB) | 0.030 | 0.028 | | Diluted Earnings Per Share (RMB) | 0.030 | 0.028 | - The Group has not issued any potential dilutive ordinary shares, thus basic and diluted earnings per share are identical[30](index=30&type=chunk) [15. Dividends](index=13&type=section&id=15.%20Dividends) The Company paid a dividend of **HKD 0.03** per share, totaling **HKD 32.7 million** (equivalent to **RMB 29.8 million**), for the year ended December 31, 2024, on June 26, 2025 - Dividends for the 2024 financial year of **HKD 0.03** per share, totaling **RMB 29.8 million**, were paid on **June 26, 2025**[31](index=31&type=chunk) - Dividends for the 2023 financial year of **HKD 0.02** per share, totaling **RMB 19.8 million**, were paid on **June 28, 2024**[31](index=31&type=chunk) [16. Property, Plant and Equipment](index=14&type=section&id=16.%20Property%2C%20Plant%20and%20Equipment) As of June 30, 2025, the Group's property, plant and equipment had a carrying value of **RMB 50,734 thousand**, a slight decrease from **RMB 51,562 thousand** at December 31, 2024, with new additions of **RMB 449 thousand** during the period Property, Plant and Equipment Carrying Value | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Buildings | 48,283 | 48,733 | | Motor Vehicles | 586 | 221 | | Electronic Equipment and Others | 1,865 | 2,608 | | **Total Carrying Value** | **50,734** | **51,562** | - Additions to property, plant and equipment amounted to **RMB 449 thousand** during the period[32](index=32&type=chunk) [17. Right-of-Use Assets and Leases](index=14&type=section&id=17.%20Right-of-Use%20Assets%20and%20Leases) As of June 30, 2025, the Group's right-of-use assets increased to **RMB 17,605 thousand** from **RMB 15,709 thousand** at December 31, 2024, with total lease liabilities also rising from **RMB 3,765 thousand** to **RMB 6,277 thousand** Right-of-Use Assets and Lease Liabilities | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | **Right-of-Use Assets** | | | | Land Use Rights | 11,402 | 11,573 | | Properties | 6,203 | 4,136 | | **Total Right-of-Use Assets** | **17,605** | **15,709** | | **Lease Liabilities** | | | | Current | 3,126 | 1,801 | | Non-current | 3,151 | 1,964 | | **Total Lease Liabilities** | **6,277** | **3,765** | - Land use rights are pledged as collateral for non-current dedicated borrowings of **RMB 164.3 million**[35](index=35&type=chunk) [18. Investments Accounted for Using the Equity Method](index=15&type=section&id=18.%20Investments%20Accounted%20for%20Using%20the%20Equity%20Method) As of June 30, 2025, the Group's investments accounted for using the equity method remained stable at **RMB 2,132 thousand**, with the Group holding a **90%** equity interest in Suzhou Cibei Enterprise Management Consulting Partnership and exercising joint control Investments Accounted for Using the Equity Method | Metric | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Balance at January 1 | 2,132 | 5,374 | | Capital Reduction | — | (1,252) | | **Balance at June 30** | **2,132** | **4,122** | - The Group holds a **90%** equity interest in Suzhou Cibei Enterprise Management Consulting Partnership and exercises joint control due to partnership agreement provisions, with the investment accounted for using the equity method[36](index=36&type=chunk) [19. Investment Properties](index=16&type=section&id=19.%20Investment%20Properties) As of June 30, 2025, the Group's investment properties had a fair value of **RMB 169,746 thousand**, consistent with December 31, 2024, primarily comprising Zhonghui Financial Building, which is partially leased out and measured at fair value, and pledged as collateral for non-current dedicated bank borrowings Investment Properties Fair Value | Category | June 30, 2025 (RMB thousands) | | :--- | :--- | | Zhonghui Financial Building | 168,066 | | Others | 1,680 | | **Total Fair Value** | **169,746** | - Zhonghui Financial Building is pledged as collateral for non-current dedicated bank borrowings of **RMB 164.3 million**[37](index=37&type=chunk) [20. Loans to Customers](index=17&type=section&id=20.%20Loans%20to%20Customers) As of June 30, 2025, the Group's total net loans to customers decreased by **6%** to **RMB 2,375,043 thousand** from December 31, 2024, with both current secured and unsecured loans decreasing, while non-current unsecured loans slightly increased; total net overdue loans decreased to **RMB 629,385 thousand** from **RMB 669,021 thousand** at December 31, 2024 Loans to Customers, Net | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | **Non-current Loans to Customers, Net** | | | | Unsecured Loans | 271,115 | 262,532 | | **Current Loans to Customers, Net** | | | | Secured Loans | 1,209,950 | 1,382,366 | | Unsecured Loans | 893,978 | 873,088 | | **Total Loans to Customers, Net** | **2,375,043** | **2,517,986** | - Current secured loans, net, decreased by **12.5%**, while current unsecured loans, net, increased by **2.4%**[41](index=41&type=chunk)[42](index=42&type=chunk) - Total net overdue loans decreased by **5.9%** from **RMB 669,021 thousand** at December 31, 2024, to **RMB 629,385 thousand** at June 30, 2025[43](index=43&type=chunk) - The fixed annual interest rate range for chattel mortgage loans narrowed from **8.0% to 54.0% in 2024** to **8.0% to 36.0% in 2025**[39](index=39&type=chunk) [21. Finance Lease Receivables](index=20&type=section&id=21.%20Finance%20Lease%20Receivables) As of June 30, 2025, the Group's net finance lease receivables increased by **29.8%** to **RMB 128,691 thousand** from **RMB 99,135 thousand** at December 31, 2024, with both undiscounted lease payments and expected credit impairment losses increasing Finance Lease Receivables Details | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Undiscounted Lease Payments | 154,187 | 113,405 | | Less: Unearned Finance Lease Income | (18,412) | (8,755) | | Less: Expected Credit Impairment Losses | (7,084) | (5,515) | | **Net Investment in Leases** | **128,691** | **99,135** | | Non-current Finance Lease Receivables | 46,444 | 26,536 | | Current Finance Lease Receivables | 82,247 | 72,599 | - The average effective interest rate for signed contracts decreased from **12.66% per annum** at December 31, 2024, to **11.17% per annum** at June 30, 2025[48](index=48&type=chunk) [22. Deferred Tax](index=21&type=section&id=22.%20Deferred%20Tax) As of June 30, 2025, the Group's net deferred tax assets increased to **RMB 110,173 thousand** from **RMB 103,374 thousand** at December 31, 2024, and net deferred tax liabilities increased to **RMB 21,904 thousand** from **RMB 18,971 thousand**, with both expected to reverse in more than one year Deferred Tax Assets and Liabilities | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | **Deferred Tax Assets** | | | | Expected Credit Losses on Financial Assets | 110,245 | 103,446 | | Deductible Losses | 1,381 | 4,314 | | Total Deferred Tax Assets | 111,626 | 107,760 | | Offset against deferred tax liabilities in accordance with offsetting criteria | (1,453) | (4,386) | | **Net Deferred Tax Assets** | **110,173** | **103,374** | | **Deferred Tax Liabilities** | | | | Net Gains from Investment Properties | 19,117 | 19,117 | | Net Gains from Financial Instruments at Fair Value Through Profit or Loss | 4,240 | 4,240 | | Total Deferred Tax Liabilities | 23,357 | 23,357 | | Offset against deferred tax assets in accordance with offsetting criteria | (1,453) | (4,386) | | **Net Deferred Tax Liabilities** | **21,904** | **18,971** | - Deferred tax assets are primarily composed of expected credit losses on financial assets, while deferred tax liabilities mainly consist of net gains from investment properties and financial instruments at fair value through profit or loss[49](index=49&type=chunk)[50](index=50&type=chunk) [23. Financial Assets at Fair Value Through Profit or Loss](index=23&type=section&id=23.%20Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, the Group's total financial assets at fair value through profit or loss slightly decreased to **RMB 115,782 thousand** from **RMB 119,859 thousand** at December 31, 2024, primarily comprising equity securities and structured deposits Financial Assets at Fair Value Through Profit or Loss | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Equity Securities | 95,352 | 99,429 | | Structured Deposits | 20,430 | 20,430 | | **Total** | **115,782** | **119,859** | - Structured deposits of **RMB 20.0 million** are pledged as collateral for bank borrowings of **RMB 19.0 million**[52](index=52&type=chunk) [24. Bank Balances and Cash on Hand](index=23&type=section&id=24.%20Bank%20Balances%20and%20Cash%20on%20Hand) As of June 30, 2025, the Group's total bank balances and cash on hand increased by **11.5%** to **RMB 164,877 thousand** from **RMB 147,893 thousand** at December 31, 2024, primarily due to a significant increase in bank time deposits with original maturity over three months Bank Balances and Cash on Hand | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Cash on Hand | 1,827 | 1,659 | | Demand Bank Deposits | 87,670 | 134,316 | | Securities Company Deposits | — | 96 | | Bank Time Deposits with Original Maturity Over Three Months, Net | 75,380 | 11,822 | | **Total** | **164,877** | **147,893** | - Net bank time deposits with original maturity over three months increased by **537.6%** year-on-year[51](index=51&type=chunk) - Bank balances and cash on hand are primarily denominated in RMB, accounting for **97.4%** of the total[51](index=51&type=chunk) [25. Share Capital](index=24&type=section&id=25.%20Share%20Capital) As of June 30, 2025, the Company's issued and fully paid ordinary share capital remained unchanged at **RMB 8,662,017 thousand**, comprising **1,090,335,000** shares, consistent with December 31, 2024 Share Capital Details | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Number of Shares | 1,090,335,000 | 1,090,335,000 | | Ordinary Shares (RMB) | 8,662,017 | 8,662,017 | - There were no changes in ordinary shares during the period[53](index=53&type=chunk) [26. Share Premium and Other Reserves](index=24&type=section&id=26.%20Share%20Premium%20and%20Other%20Reserves) As of June 30, 2025, the Group's total share premium and other reserves decreased to **RMB 1,175,077 thousand** from **RMB 1,191,717 thousand** at January 1, 2025, primarily due to a reduction in capital reserve from partial disposal of a subsidiary Share Premium and Other Reserves | Category | January 1, 2025 (RMB thousands) | June 30, 2025 (RMB thousands) | | :--- | :--- | :--- | | Share Premium | 604,478 | 604,478 | | Capital Reserve | 498,574 | 481,934 | | Statutory Reserve | 77,715 | 77,715 | | General Reserve | 4,417 | 4,417 | | Share-based Payment Reserve | 6,533 | 6,533 | | **Total** | **1,191,717** | **1,175,077** | - Partial disposal of a subsidiary without losing control resulted in a **RMB 16,640 thousand** decrease in capital reserve[54](index=54&type=chunk) [27. Borrowings](index=25&type=section&id=27.%20Borrowings) As of June 30, 2025, the Group's total borrowings decreased by **14%** to **RMB 952,974 thousand** from **RMB 1,107,583 thousand** at December 31, 2024, with significant reductions in non-current bank borrowings and current micro-loan company borrowings, while current bank borrowings and employee borrowings increased Borrowings by Category | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | **Non-current Borrowings** | | | | Bank Borrowings | 203,500 | 334,000 | | **Current Borrowings** | | | | Bank Borrowings | 457,810 | 425,020 | | Borrowings from Other Companies | 105,415 | 115,520 | | Borrowings from Micro-loan Companies | 40,000 | 95,000 | | Borrowings from Employees within the Group | 136,249 | 128,043 | | Borrowings from Ultimate Shareholders | 10,000 | 10,000 | | **Total** | **952,974** | **1,107,583** | - Non-current bank borrowings decreased by **39.1%**, and current micro-loan company borrowings decreased by **57.9%**[55](index=55&type=chunk) - Non-current bank borrowings are secured or guaranteed by Zhonghui Financial Building, subsidiary shares, and other assets[56](index=56&type=chunk) - Current bank borrowings have interest rates ranging from **1.49% to 6.0%** and are partially guaranteed by structured deposits, Wuzhong Jiaye, and Wuzhong Group[57](index=57&type=chunk)[58](index=58&type=chunk) [28. Other Current Liabilities](index=26&type=section&id=28.%20Other%20Current%20Liabilities) As of June 30, 2025, the Group's total other current liabilities decreased by **13%** to **RMB 121,528 thousand** from **RMB 139,598 thousand** at December 31, 2024, with significant reductions in payables for construction projects, advances from transferees of financial asset receivables, and deposits for resale arrangements, while bills payable significantly increased Other Current Liabilities by Category | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Payables for Construction Projects | — | 14,899 | | Advances from Transferees of Financial Asset Receivables | — | 19,150 | | Advances from Customers for Goods | 487 | 13 | | Advances from Customers for Consulting Fees | — | 450 | | Employee Benefits Payable | 2,351 | 5,686 | | Taxes and Other Levies Payable | 2,254 | 3,676 | | Deposits for Resale Arrangements | — | 50,000 | | Bills Payable | 104,695 | 31,746 | | Other Financial Liabilities | 11,741 | 13,978 | | **Total** | **121,528** | **139,598** | - Bills payable increased by **230%** year-on-year[59](index=59&type=chunk) [29. Contingent Liabilities](index=26&type=section&id=29.%20Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities, consistent with December 31, 2024 - The Group has no significant contingent liabilities[60](index=60&type=chunk) [30. Commitments](index=27&type=section&id=30.%20Commitments) As of June 30, 2025, the Group's total capital commitments remained unchanged at **RMB 57,868 thousand**, primarily comprising agreed capital contributions to Suzhou Cibei, Qianhui Tongcui, and Kangli Junzhuo Capital Commitments | Investee Company Name | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Suzhou Cibei | 42,868 | 42,868 | | Qianhui Tongcui | 10,000 | 10,000 | | Kangli Junzhuo | 5,000 | 5,000 | | **Total** | **57,868** | **57,868** | - Of the **RMB 45.0 million** agreed capital contribution to Suzhou Cibei, **RMB 42.9 million** remains unpaid[62](index=62&type=chunk) [Management Discussion and Analysis](index=28&type=section&id=Management%20Discussion%20and%20Analysis) [1. Business Review and Development](index=28&type=section&id=1.%20Business%20Review%20and%20Development) During the reporting period, the Company maintained steady progress amidst a weak external economic environment, driving development through innovation, optimizing business structure, and strengthening risk control; the Inclusive Finance Business Segment focused on resolving existing issues and achieving new growth, while the Ecosystem Finance Business Segment maintained good development despite intensified market competition, with special asset investment business performing remarkably - The Company maintained steady progress, driving development through innovation, continuously optimizing business structure, strengthening risk control, and enhancing management efficiency[63](index=63&type=chunk) - The Inclusive Finance Business Segment focused on resolving existing real estate mortgage loans and achieving new growth, while steadily developing listed company stock pledge loans for unsecured loans[63](index=63&type=chunk) - The Ecosystem Finance Business Segment's commercial factoring business maintained good development, and key projects in special asset investment business exited safely, contributing significantly to profit[63](index=63&type=chunk) [1.1 Inclusive Finance Business Segment](index=28&type=section&id=1.1%20Inclusive%20Finance%20Business%20Segment) The Inclusive Finance Business Segment provides loan services to SMEs and individuals through pawn, technology micro-lending, bridging loan funds, art investment, and overseas financial businesses; during the period, real estate mortgage loan interest income decreased, unsecured loan interest income increased, technology micro-lending and bridging loan fund businesses scaled down, art investment business income decreased, and overseas financial business actively reduced loan balances - The Inclusive Finance Business Segment primarily provides services to customers through secured and unsecured loans, covering cities such as Suzhou, Chengdu, Wuhan, Hefei, Changsha, Nanjing, and Fuzhou[64](index=64&type=chunk)[65](index=65&type=chunk) [Pawn Business](index=29&type=section&id=Pawn%20Business) The pawn business includes real estate and chattel mortgage loans; as of June 30, 2025, real estate mortgage loan balances and interest income decreased due to declining property prices and increased market competition, while unsecured loan balances and interest income rose, benefiting from new listed company stock pledge business Pawn Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total New Real Estate Mortgage Loans Granted (RMB millions) | 107 | 254 | | Real Estate Mortgage Loan Balance (Principal) at Period End (RMB millions) | 683 | 793 | | Interest Income from Real Estate Mortgage Loans (RMB thousands) | 16,596 | 54,830 | | Chattel Mortgage Loan Balance (Principal) at Period End (RMB millions) | 175 | 173 | | Interest Income from Chattel Mortgage Loans (RMB thousands) | 15,392 | 15,786 | | Total New Unsecured Loans Granted (RMB millions) | 286 | 374 | | Unsecured Loan Balance (Principal) at Period End (RMB millions) | 482 | 436 | | Interest Income from Unsecured Loans (RMB thousands) | 44,310 | 10,175 | - Interest income from real estate mortgage loans decreased by **69.7%** year-on-year, while interest income from unsecured loans increased by **335.5%** year-on-year[67](index=67&type=chunk) - The pawn business will prudently reduce the scale of art mortgage loans in the future[72](index=72&type=chunk) - Unsecured loans will steadily reduce the balance of existing businesses and expand the scale of listed company stock pledge businesses in the future[73](index=73&type=chunk) [Technology Micro-loan Business](index=33&type=section&id=Technology%20Micro-loan%20Business) The technology micro-loan business, primarily conducted through Dongshan Micro-loan, provides secured, guaranteed, and unsecured loans to SMEs and individuals; as of June 30, 2025, both new loan amounts and interest income decreased due to intensified market competition and challenges in business expansion, with future plans to increase services for technology-driven and low-carbon SMEs Technology Micro-loan Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total New Loans Granted (RMB millions) | 151 | 427 | | Balance (Principal) at Period End (RMB millions) | 495 | 547 | | Interest Income (RMB thousands) | 22,144 | 24,499 | - Total new loans granted decreased by **64.6%** year-on-year, and interest income decreased by **9.6%** year-on-year[75](index=75&type=chunk) - The future development direction is to increase services for technology-driven and low-carbon SMEs, fulfilling social responsibility for inclusive finance[79](index=79&type=chunk) [Bridging Loan Fund Business](index=36&type=section&id=Bridging%20Loan%20Fund%20Business) The bridging loan fund business, primarily conducted through Huifang Rongtong, provides short-term bridging loan services to SMEs and local government platforms; as of June 30, 2025, both new loan amounts and interest income decreased due to the introduction of banks' interest-free renewal loans and regulatory requirements, with future plans to maintain customer acquisition scenarios and support SMEs' bridging loan needs Bridging Loan Fund Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total New Loans Granted (RMB millions) | 1,084 | 2,360 | | Interest Income (RMB thousands) | 1,179 | 2,684 | - Total new loans granted decreased by **54.1%** year-on-year, and interest income decreased by **56.1%** year-on-year[81](index=81&type=chunk) - The future development direction is to adhere to the customer acquisition scenarios of bridging loan funds and firmly support SMEs' bridging loan needs[83](index=83&type=chunk) [Art Investment Business](index=37&type=section&id=Art%20Investment%20Business) The art investment business, primarily conducted through Nanjing Yiling, covers all categories of art, including modern and contemporary Chinese and international paintings; as of June 30, 2025, art transaction inventory and operating income both decreased due to economic downturn and reduced art market transaction volume and prices, with future plans to moderately reduce transaction scale and build a comprehensive service platform for the entire art industry chain Art Investment Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Art Transaction Inventory Amount at Period End (RMB millions) | 114 | 133 | | Art Business Operating Income (RMB thousands) | 7,700 | 9,148 | - Art business operating income decreased by **15.8%** year-on-year[85](index=85&type=chunk) - The future development direction is to strive to build a comprehensive service platform for the entire art industry chain and develop into a well-known regional art comprehensive service institution[87](index=87&type=chunk) [Overseas Financial Business](index=38&type=section&id=Overseas%20Financial%20Business) The overseas financial business, primarily conducted through Huifang Investment in Hong Kong, provides guarantee-backed loans; as of June 30, 2025, both loan balances and interest income decreased due to the company's proactive reduction of loan balances to control operating risks, with future plans to explore opportunities in pawn and digital assets in more overseas countries and regions like Southeast Asia Overseas Financial Business Performance | Metric (HKD millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Balance (Principal) at Period End (HKD millions) | 20 | 23 | | Interest Income (HKD thousands) | 545 | 724 | - Interest income decreased by **24.7%** year-on-year[88](index=88&type=chunk) - The future development direction is to seek layout opportunities in pawn, digital assets, and other fields in more overseas countries and regions like Southeast Asia[90](index=90&type=chunk) [1.2 Ecosystem Finance Business Segment](index=39&type=section&id=1.2%20Ecosystem%20Finance%20Business%20Segment) The Ecosystem Finance Business Segment encompasses commercial factoring, finance leasing, supply chain management, equity investment, special asset investment, and insurance agency businesses; during the period, commercial factoring saw increased balances but decreased income, finance leasing expanded with increased income, supply chain management sales revenue rose, equity investment generated positive income, key special asset investment projects exited safely, and insurance agency business income grew - The Ecosystem Finance Business Segment is committed to supply chain technology, tech-enabled lending, factoring, insurance brokerage, and equity investment businesses[91](index=91&type=chunk)[92](index=92&type=chunk) [Commercial Factoring Business](index=40&type=section&id=Commercial%20Factoring%20Business) The commercial factoring business, primarily conducted through Huida Factoring, provides trade financing services to SMEs; as of June 30, 2025, both new accounts receivable factoring business amounts and period-end balances increased, but the combined interest and service fee income decreased, mainly due to overdue businesses entering litigation, with future plans to continue focusing on government project factoring and promote multi-dimensional financing Commercial Factoring Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total New Accounts Receivable Factoring Business Amount (RMB millions) | 120 | 98 | | Balance (Principal) at Period End (RMB millions) | 460 | 421 | | Interest Income (RMB thousands) | 16,249 | 18,208 | | Service Fee Income (RMB thousands) | 2,249 | 2,938 | - Total new accounts receivable factoring business amount increased by **22.4%** year-on-year, and period-end balance increased by **9.3%** year-on-year[94](index=94&type=chunk) - Combined interest income and service fee income decreased by **18.2%** year-on-year[94](index=94&type=chunk) - The future development direction is to monitor local government accounts payable, dynamically adjust business scale, and promote multi-dimensional financing[96](index=96&type=chunk) [Finance Lease Business](index=42&type=section&id=Finance%20Lease%20Business) The finance lease business, primarily conducted through Huifang Rongzu, provides direct finance lease and sale-and-leaseback services; as of June 30, 2025, both new finance lease transaction amounts and period-end balances increased, with combined interest and service fee income growing due to business structure optimization and scale expansion, and future plans to explore direct lease opportunities in advanced manufacturing, healthcare, and public utilities Finance Lease Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total New Finance Lease Transactions (RMB millions) | 90 | 29 | | Balance (Principal) at Period End (RMB millions) | 135 | 109 | | Interest Income (RMB thousands) | 5,674 | 4,531 | | Service Fee Income (RMB thousands) | 472 | 241 | - Total new finance lease transactions increased by **210.3%** year-on-year, and combined interest income and service fee income increased by **24.9%** year-on-year[98](index=98&type=chunk) - The future development direction is to explore direct lease opportunities in advanced manufacturing, healthcare, and public utilities[100](index=100&type=chunk) [Supply Chain Management Business](index=43&type=section&id=Supply%20Chain%20Management%20Business) The supply chain management business, primarily conducted through Huifang Supply Chain, focuses on consumer goods such as grain, oil, and fresh produce; as of June 30, 2025, both total transaction volume and sales revenue increased due to business structure optimization and higher fresh produce sales, with future plans to actively expand partnerships with qualified entities to establish long-term, large-volume supply chain collaborations Supply Chain Management Business Performance | Metric (RMB thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Number of Transactions | 747 | 643 | | Sales Revenue | 198,171 | 183,556 | | Grain and Oil Sales Revenue | 161,206 | 168,989 | | Fresh Produce Sales Revenue | 35,726 | 7,230 | - Sales revenue increased by **7.9%** year-on-year, with fresh produce sales revenue increasing by **394.1%** year-on-year[101](index=101&type=chunk) - The future development direction is to actively expand partnerships with qualified entities and establish long-term, large-volume supply chain collaborations[103](index=103&type=chunk) [Equity Investment Business](index=45&type=section&id=Equity%20Investment%20Business) The equity investment business, primarily conducted through Huifang Rongcui, aims to achieve synergistic development of debt and equity, investing in strategic emerging industries such as advanced manufacturing and semiconductors; as of June 30, 2025, period-end investment principal slightly decreased, with investment income of **RMB 6 thousand**, and future plans to prudently add new investment projects, prioritize post-investment management of existing projects, and accelerate project exits Equity Investment Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Investment Principal Amount at Period End (RMB millions) | 79 | 81 | | Investment Income (RMB thousands) | 6 | (3) | - Investment income shifted from a loss in the prior period to a profit[104](index=104&type=chunk) - The future development direction is to monitor equity investment market policy trends, prudently add new investment projects, and accelerate the exit of existing projects[107](index=107&type=chunk) [Special Asset Investment Business](index=46&type=section&id=Special%20Asset%20Investment%20Business) The special asset investment business, primarily conducted through Qingdao Wanchen, focuses on the acquisition, disposal, and operation of special assets; as of June 30, 2025, period-end investment balances significantly decreased due to the successful exit of two key projects, Guangda Xueke and Hongzhuang Commercial, with interest income of **RMB 3,351 thousand**, and future plans to actively seek target investment opportunities, deepen debt investment through bankruptcy and pre-reorganization, and build a deep cooperation network Special Asset Investment Business Performance | Metric (RMB millions/thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Investment Amount at Period End (RMB millions) | 2 | 306 | | Interest Income (RMB thousands) | 3,351 | 16,524 | - Period-end investment balance decreased by **99.3%** year-on-year, and interest income decreased by **79.7%** year-on-year[108](index=108&type=chunk) - Two key projects, Guangda Xueke and Hongzhuang Commercial, successfully exited during the reporting period[109](index=109&type=chunk)[110](index=110&type=chunk) - The future development direction is to actively seek target investment opportunities, deepen debt investment through bankruptcy and pre-reorganization, and build a deep cooperation network[111](index=111&type=chunk) [Insurance Agency Business](index=48&type=section&id=Insurance%20Agency%20Business) The insurance agency business, primarily conducted through Huifang Anda, covers property insurance, credit guarantee insurance, and other types; as of June 30, 2025, both total transaction volume and commission income increased due to vigorous expansion of new businesses, with future plans to strive for new co-insurance partnerships and explore opportunities in healthcare and education sectors Insurance Agency Business Performance | Metric (RMB thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Number of Transactions | 746 | 37 | | Commission Income | 173 | 127 | - Total number of transactions increased by **1916.2%** year-on-year, and commission income increased by **36.2%** year-on-year[113](index=113&type=chunk) - The future development direction is to strive for new co-insurance partnerships, explore opportunities in healthcare and education sectors, and introduce a competitive team of agents[114](index=114&type=chunk) [2. Financial Review](index=49&type=section&id=2.%20Financial%20Review) As of June 30, 2025, the Group's operating revenue decreased year-on-year due to macroeconomic conditions and credit policies, yet profit attributable to owners of the Company increased, mainly driven by a reduced proportion of non-controlling interests; while both Inclusive Finance and Ecosystem Finance segments saw a decline in profit before tax, the Headquarters and Other segments experienced an increase in both operating revenue and profit before tax Financial Performance Summary | Metric (RMB thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Operating Revenue | 345,814 | 351,380 | | Net Operating Income | 84,206 | 100,522 | | Profit attributable to owners of the Company | 32,762 | 30,609 | | Basic Earnings Per Share (RMB) | 0.030 | 0.028 | - Operating revenue decreased by **2%** year-on-year, while profit attributable to owners of the Company increased by **7%** year-on-year[116](index=116&type=chunk) [2.2.1 Inclusive Finance Business Segment](index=50&type=section&id=2.2.1%20Inclusive%20Finance%20Business%20Segment) As of June 30, 2025, the Inclusive Finance Business Segment's operating revenue decreased by **8%** year-on-year, and profit before tax decreased by **50%** year-on-year, primarily due to a slowdown in macroeconomic growth, reduced loan scale from lower loan prime rates, and increased expected credit losses Inclusive Finance Business Segment Performance | Metric (RMB thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Operating Revenue | 107,945 | 117,293 | | Profit Before Tax | 23,222 | 46,822 | - The decrease in operating revenue was mainly affected by China's economic slowdown and lower loan prime rates[117](index=117&type=chunk) - The decrease in profit before tax was primarily due to lower operating revenue and increased expected credit losses[117](index=117&type=chunk) [2.2.2 Ecosystem Finance Business Segment](index=50&type=section&id=2.2.2%20Ecosystem%20Finance%20Business%20Segment) As of June 30, 2025, the Ecosystem Finance Business Segment's operating revenue increased by **1.6%** year-on-year, primarily driven by higher sales revenue from the supply chain management business; however, profit before tax decreased by **50.4%** year-on-year, mainly due to the transfer of some operating revenue from special asset management business to the Headquarters and Other segments Ecosystem Finance Business Segment Performance | Metric (RMB thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Operating Revenue | 230,894 | 227,298 | | Profit Before Tax | 11,726 | 23,645 | - The increase in operating revenue was primarily driven by sales revenue from the supply chain management business[118](index=118&type=chunk) - The decrease in profit before tax was mainly due to the transfer of some operating revenue from special asset management business to the Headquarters and Other segments[119](index=119&type=chunk) [2.2.3 Headquarters and Others](index=51&type=section&id=2.2.3%20Headquarters%20and%20Others) As of June 30, 2025, the Headquarters and Other segments' operating revenue increased by **264.7%** year-on-year, and profit before tax shifted from a loss to a profit, primarily due to the transfer of some operating revenue from special asset management business; the Headquarters will continue to promote refined management to increase revenue and reduce expenses Headquarters and Others Performance | Metric (RMB thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Operating Revenue | 40,016 | 10,972 | | Profit/(Loss) Before Tax | 14,592 | (13,310) | - The increase in operating revenue and profit before tax was mainly due to the transfer of some operating revenue from special asset management business[121](index=121&type=chunk) [3. Credit Risk](index=52&type=section&id=3.%20Credit%20Risk) The Group's credit risk exposure is primarily concentrated in loans to customers; as of June 30, 2025, total credit impairment provisions amounted to **RMB 652,373 thousand**, a decrease of **RMB 173,380 thousand** from the prior year-end, mainly due to the transfer of some loans to Stage 3 and the write-off of Stage 3 equity pledge loans, with comprehensive credit risk management and internal control measures in place for all lending businesses - As of June 30, 2025, expected credit loss provisions for loans to customers totaled **RMB 652,373 thousand**, representing approximately **21.55%** of total loans to customers (before provisions)[128](index=128&type=chunk) - The Group's total impairment provisions decreased by **RMB 173,380 thousand** from the prior year-end[128](index=128&type=chunk) - Assets written off during the reporting period amounted to **RMB 114 million**, primarily consisting of Stage 3 equity pledge loans[129](index=129&type=chunk)[130](index=130&type=chunk) - The increase in new litigation-involved secured and unsecured loan balances compared to the prior period reflects the Company's intensified efforts in debt collection and disposal of risky assets[132](index=132&type=chunk) [3.3.1 Credit Risk Management](index=56&type=section&id=3.3.1%20Credit%20Risk%20Management) The Group's lending business is categorized into four units: pawn, technology micro-lending, overseas finance, bridging loan funds, commercial factoring, and finance leasing; each unit has established clear guidelines, policies, and measures for pre-loan assessment, loan granting, post-loan monitoring, and loan recovery to effectively manage credit risk - The Group's lending business primarily includes four business units: pawn, technology micro-lending, overseas finance, bridging loan funds, commercial factoring, and finance leasing[133](index=133&type=chunk) - Each business unit has established clear guidelines, policies, and measures for credit risk assessment, loan granting, post-loan monitoring, and risk management[133](index=133&type=chunk) [3.3.1.1 Pawn Business, Micro-loan Business, Overseas Financial Business](index=56&type=section&id=3.3.1.1%20Pawn%20Business%2C%20Micro-loan%20Business%2C%20Overseas%20Financial%20Business) Credit risk management for these business units covers both secured and unsecured loans, with pre-loan assessment including due diligence and credit evaluation, treating renewed loans as new applications; loan granting follows clear approval standards and disbursement processes, while post-loan monitoring and recovery procedures are stringent, supported by a comprehensive management system for documentation and early warnings - Pre-loan assessment for secured loans includes verifying customer identity, financial status, collateral appraisal reports, and on-site inspections[136](index=136&type=chunk) - Due diligence for unsecured loans includes verifying basic customer information, financial information, operating data, and guarantor information[146](index=146&type=chunk)[147](index=147&type=chunk) - All loan renewals are treated as new loan applications and assessed using the same procedures[139](index=139&type=chunk)[149](index=149&type=chunk) [3.3.1.2 Bridging Loan Fund Business](index=61&type=section&id=3.3.1.2%20Bridging%20Loan%20Fund%20Business) The bridging loan fund business provides short-term loans to SMEs to alleviate cash flow pressure from 'repay first, then borrow again' policies; pre-loan assessment includes due diligence and credit evaluation, with clear approval standards for loan granting, and post-loan monitoring involves comprehensive tracking, early warning mechanisms, and recovery plans for overdue clients - The bridging loan fund business aims to alleviate SMEs' cash flow pressure from 'repay first, then borrow again' policies[157](index=157&type=chunk) - The credit risks undertaken by the Group in the bridging loan fund business include changes in bank loan renewal conditions, SMEs not meeting renewal criteria, misappropriation of loan funds, and overdue repayments[161](index=161&type=chunk) - Post-loan monitoring tracks and supervises the six stages of the bridging loan cycle and establishes an early warning mechanism[166](index=166&type=chunk) [3.3.1.3 Commercial Factoring Business](index=64&type=section&id=3.3.1.3%20Commercial%20Factoring%20Business) Credit risk management for commercial factoring involves due diligence and credit evaluation of clients and debtors, focusing on the authenticity, legality, and recoverability of accounts receivable; post-loan monitoring through regular collection of financial statements and on-site investigations, with immediate collection measures taken for unredeemed accounts receivable or debtor defaults - Due diligence includes collecting accounts receivable information, verifying registration results, and reviewing business licenses and financial statements[169](index=169&type=chunk) - Credit evaluation categorizes clients and debtors into manufacturing (or service-oriented) enterprises and engineering project enterprises, with different assessment standards applied[170](index=170&type=chunk) - Post-loan monitoring is conducted through monthly or quarterly collection of client financial statements, on-site investigations, and credit record monitoring[175](index=175&type=chunk) [3.3.1.4 Finance Lease Business](index=66&type=section&id=3.3.1.4%20Finance%20Lease%20Business) Credit risk management for finance leasing includes due diligence and credit evaluation of clients, potentially requiring additional collateral or guarantees for loan granting; post-loan monitoring involves regular review of lessee's operating conditions and financial reports, with the right to demand payment or dispose of leased assets in case of rental payment defaults or non-fulfillment of obligations - Credit evaluation comprehensively considers the client's industry and reputation, cash flow, solvency, liquidity, value, and realizability of leased assets[180](index=180&type=chunk) - Depending on the client's creditworthiness, the lessee and third parties may be required to provide additional collateral or guarantees[182](index=182&type=chunk) - Post-loan monitoring regularly reviews changes in the lessee's operating conditions, solvency, creditworthiness, and debt obligations[185](index=185&type=chunk) [3.3.2 Internal Control](index=68&type=section&id=3.3.2%20Internal%20Control) The Group has established a comprehensive risk management system covering all employees, products, and processes, including separation of credit assessment and loan disbursement, multi-level loan approval policies, post-loan monitoring procedures, an early warning system, and policies for managing defaulted debts and bad debt write-offs - Multi-level loan approval policies are established to clarify responsibilities for different positions, promoting integrity and accountability among front, middle, and back-office staff[188](index=188&type=chunk) - Post-loan monitoring and management procedures are implemented for continuous monitoring and management of credit risk and the entire loan process[188](index=188&type=chunk) - A comprehensive management system with an early warning system is established to ensure accurate and timely recording of each transaction and identification of defaulted loans[188](index=188&type=chunk) [4. Capital Expenditure](index=71&type=section&id=4.%20Capital%20Expenditure) For the six months ended June 30, 2025, the Group's capital expenditure decreased to **RMB 4,300 thousand** from **RMB 6,581 thousand** in the prior period, primarily including property, plant and equipment, intangible assets, and investment properties - Capital expenditure for the six months ended June 30, 2025, was **RMB 4,300 thousand**, a **34.6%** year-on-year decrease[196](index=196&type=chunk) [5. Foreign Exchange Exposure](index=71&type=section&id=5.%20Foreign%20Exchange%20Exposure) For the six months ended June 30, 2025, the Group incurred net exchange losses of **RMB 396 thousand**, an increase from **RMB 266 thousand** in the prior period; as the Group primarily conducts business transactions in RMB, it does not face significant foreign exchange risk and has not undertaken any related hedging - For the six months ended June 30, 2025, the Group incurred net exchange losses of **RMB 396 thousand**, a **48.9%** year-on-year increase[197](index=197&type=chunk) - The Group primarily conducts business transactions in RMB, thus not facing significant foreign exchange risk and not undertaking any hedging[197](index=197&type=chunk) [6. Pledged Assets](index=71&type=section&id=6.%20Pledged%20Assets) As of June 30, 2025, the Group's land use rights and Zhonghui Financial Building were pledged as collateral for non-current bank borrowings, and **RMB 20.0 million** in structured deposits were pledged as collateral for **RMB 19.0 million** in bank borrowings - Land use rights and Zhonghui Financial Building are pledged as collateral for non-current bank borrowings of **RMB 164.3 million**[198](index=198&type=chunk) - Structured deposits of **RMB 20.0 million** are pledged as collateral for bank borrowings of **RMB 19.0 million**[198](index=198&type=chunk) [7. Significant Investments, Acquisitions and Disposals](index=71&type=section&id=7.%20Significant%20Investments%2C%20Acquisitions%20and%20Disposals) During the reporting period, the Group completed the acquisition and disposal of Guangda Jiaoke and Hongzhuang Commercial, which were commercially aimed at providing financing solutions to customers, generating consulting service income and interest income, and creating value for the company and shareholders - The Group completed the acquisition and disposal of Guangda Jiaoke, generating consulting service income of **RMB 3 million** and interest income of **RMB 3.3 million**[202](index=202&type=chunk) - The Group completed the acquisition and disposal of Hongzhuang Commercial, whose commercial substance was to provide financing to Suzhou Xinwei for the acquisition of Hongzhuang Commercial[204](index=204&type=chunk)[205](index=205&type=chunk) - The Board believes these acquisitions and disposals provided opportunities for the Group to generate investment returns and offer financing solutions to customers, achieving a win-win outcome[202](index=202&type=chunk)[205](index=205&type=chunk) [8. Contingent Liabilities, Contractual Obligations, and Cash Flow Analysis](index=74&type=section&id=8.%20Contingent%20Liabilities%2C%20Contractual%20Obligations%2C%20and%20Cash%20Flow%20Analysis) As of June 30, 2025, the Group had no significant contingent liabilities, with total capital commitments of **RMB 57,868 thousand**; during the reporting period, net cash inflow from operating activities was **RMB 261,486 thousand**, net cash outflow from investing activities was **RMB 108,449 thousand**, and net cash outflow from financing activities was **RMB 199,313 thousand**, resulting in a net decrease in cash and cash equivalents - The Group has no significant contingent liabilities[206](index=206&type=chunk) Cash Flow Summary | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Cash Inflow/(Outflow) from Operating Activities | 261,486 | (207,990) | | Net Cash (Outflow)/Inflow from Investing Activities | (108,449) | 3,772 | | Net Cash (Outflow)/Inflow from Financing Activities | (199,313) | 189,441 | | Net Decrease in Cash and Cash Equivalents | (46,276) | (14,777) | - Net cash inflow from operating activities was primarily due to a decrease in loans to customers[209](index=209&type=chunk) - Net cash outflow from investing activities was mainly due to reduced investment activities amidst a macroeconomic downturn[210](index=210&type=chunk) - Net cash outflow from financing activities was primarily due to a decrease in new borrowings and an increase in repayment of borrowings[211](index=211&type=chunk) [9. Human Resources and Employee Benefits](index=76&type=section&id=9.%20Human%20Resources%20and%20Employee%20Benefits) As of June 30, 2025, the Group had **153** full-time employees, a decrease of **3** from December 31, 2024; staff salaries and benefits amounted to **RMB 15,542 thousand**, a year-on-year decrease of **RMB 5,084 thousand**, with the Group committed to human resource optimization, providing training, and complying with China's social security and housing provident fund responsibilities - As of June 30, 2025, the number of full-time employees was **153**, a decrease of **3** from December 31, 2024[212](index=212&type=chunk) - Staff salaries and benefits amounted to **RMB 15,542 thousand**, a year-on-year decrease of **RMB 5,084 thousand**[212](index=212&type=chunk) - The Group continues to optimize human resources and provides training to promote employees' personal and professional development[212](index=212&type=chunk) [10. Future Plans for Significant Investments](index=76&type=section&id=10.%20Future%20Plans%20for%20Significant%20Investments) Aside from disclosed capital commitments, the Group has no other significant investment and capital asset acquisition plans but will continue to seek new business development opportunities, with investments funded by internal resources and bank financing - Aside from disclosed capital commitments, the Group has no other significant investment and capital asset acquisition plans[214](index=214&type=chunk) - The Group will continue to seek new business development opportunities, with investments funded by internal resources and bank financing[214](index=214&type=chunk) [11. Events After Reporting Period](index=76&type=section&id=11.%20Events%20After%20Reporting%20Period) As of the date of this announcement, no significant events have occurred after the reporting period, other than those already disclosed - No significant events occurred after the reporting period and up to the date of this announcement[215](index=215&type=chunk) [Future Outlook](index=77&type=section&id=Future%20Outlook) The Group will continue to implement a dual-driven strategy of inclusive finance and ecosystem finance; the Inclusive Finance Business Segment will deepen due diligence, strictly control risks, expand scale, and maintain stable development of art investment business; the Ecosystem Finance Business Segment will intensify commercial factoring expansion, strengthen post-loan management for finance leasing,

Company Information and Report Overview [Company Basic Information](index=1&type=section&id=Company%20Basic%20Information) This report presents the interim results announcement for China Ting Group Holdings Limited (Stock Code: 3398) for the six months ended June 30, 2025 - Company Name: CHINA TING GROUP HOLDINGS LIMITED (華鼎集團控股有限公司)[2](index=2&type=chunk) - Stock Code: **3398**[2](index=2&type=chunk) - Reporting Period: Six months ended **June 30, 2025** (Interim Results)[2](index=2&type=chunk) [Financial Performance Summary](index=1&type=section&id=Financial%20Performance%20Summary) In the first half of 2025, the Group's total revenue increased by **13.8%** to **HKD 899.0 million**, but the loss for the period expanded to **HKD 64.4 million**, primarily due to fair value losses on investment properties Key Financial Summary for H1 2025 | Metric | H1 2025 (million HKD) | H1 2024 (million HKD) | Percentage Change | | :--- | :--- | :--- | :--- | | Revenue | 899.0 | 789.9 | 13.8 | | OEM Business Revenue | 477.6 | 474.5 | 0.7 | | Fashion Retail Business Revenue | 351.8 | 288.7 | 21.9 | | Property Investment Business Revenue | 69.6 | 26.7 | 160.7 | | Operating Loss | (38.6) | (180.3) | - | | Loss for the Period | (64.4) | (142.5) | - | | Fair Value Loss on Investment Properties | 8.5 | 56.3 | - | | Loss for the Period Excluding Significant Items | (55.9) | (86.2) | - | | Equity per Share (HKD) | 0.73 | 0.87 | - | Condensed Consolidated Financial Statements [Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) In the first half of 2025, the Group's revenue increased by **13.8%** to **HKD 899.0 million**, and gross profit grew by **13.1%** to **HKD 162.8 million**; however, due to increased impairment losses on financial assets and fair value losses on investment properties, the loss for the period narrowed to **HKD 64.4 million** from **HKD 142.5 million** in the prior year, with basic loss per share at **4.05 HK cents** Condensed Consolidated Statement of Comprehensive Income (Summary) | Metric (thousand HKD) | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 899,007 | 789,940 | | Cost of sales | (736,219) | (645,914) | | Gross profit | 162,788 | 144,026 | | Other income | 82,076 | 9,289 | | Fair value loss on investment properties | (8,542) | (56,322) | | Impairment losses on financial assets (provision) / net reversal | (21,932) | 2,504 | | Selling, marketing and distribution costs | (124,880) | (159,692) | | Administrative expenses | (124,309) | (121,510) | | Operating loss | (38,565) | (180,341) | | Net finance costs | (19,939) | (9,112) | | Loss before income tax | (58,614) | (189,544) | | Income tax (expense) / credit | (5,826) | 47,064 | | Loss for the period | (64,440) | (142,480) | | Loss attributable to equity holders of the Company | (85,080) | (141,189) | | Basic and diluted loss per share (HK cents) | (4.05) | (6.72) | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets increased to **HKD 3,373.4 million**, driven by higher investment properties and trade receivables; total liabilities rose to **HKD 1,803.4 million**, with a significant increase in current bank borrowings, resulting in net current liabilities of **HKD 57.3 million**, indicating liquidity pressure Condensed Consolidated Statement of Financial Position (Summary) | Metric (thousand HKD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Total non-current assets | 2,019,433 | 1,958,903 | | Investment properties | 1,127,145 | 1,062,513 | | Total current assets | 1,353,981 | 1,326,044 | | Inventories | 614,459 | 688,700 | | Trade and other receivables | 496,323 | 449,391 | | Cash and cash equivalents | 195,664 | 140,510 | | **Total Assets** | **3,373,414** | **3,284,947** | | **EQUITY** | | | | Equity attributable to equity holders of the Company | 1,541,213 | 1,559,766 | | Total equity | 1,570,050 | 1,571,668 | | **LIABILITIES** | | | | Total non-current liabilities | 392,101 | 371,881 | | Total current liabilities | 1,411,263 | 1,341,398 | | Trade and other payables | 677,264 | 744,509 | | Bank borrowings (current) | 561,918 | 413,709 | | **Total Liabilities** | **1,803,364** | **1,713,279** | Notes to the Condensed Consolidated Interim Financial Information [Basis of Preparation](index=6&type=section&id=Basis%20of%20Preparation) This condensed consolidated interim financial information is prepared in accordance with HKAS 34 and presented on a going concern basis; however, the Group faces liquidity pressure with a net loss of **HKD 64.4 million** and net current liabilities of **HKD 57.3 million** as of June 30, 2025, including bank loan covenant breaches requiring immediate repayment of some loans, while management has formulated plans to address these challenges, significant uncertainties regarding going concern remain - The Group incurred a net loss of **HKD 64.4 million** in H1 2025, with net current liabilities of **HKD 57.3 million** as of that date[8](index=8&type=chunk) - The Group faces liquidity pressure due to breaches of loan covenants related to liquidity ratios in bank financing, with **HKD 63.2 million** in bank loans immediately repayable upon demand[8](index=8&type=chunk) - Management has formulated several plans, including seeking new financing, implementing cost-saving measures, streamlining operating units, and adjusting the pace of operational expansion, to maintain going concern[9](index=9&type=chunk)[10](index=10&type=chunk) - The adoption of the going concern basis relies on the successful implementation of these plans, but their future outcomes are uncertain, potentially casting significant doubt on the Group's ability to continue as a going concern[11](index=11&type=chunk) [Accounting Policies](index=7&type=section&id=Accounting%20Policies) The accounting policies used in the interim condensed consolidated financial information are consistent with the 2024 annual consolidated financial statements, with the initial adoption of HKAS 21 (Amendment) "Lack of Exchangeability" having no significant impact; several new and amended standards have been issued but are not yet effective and are not expected to materially affect the Group's accounting policies - The Group initially adopted HKAS 21 (Amendment) "Lack of Exchangeability," which had no significant impact on the interim condensed consolidated financial information[14](index=14&type=chunk) - Several new standards and amendments to existing standards (e.g., HKFRS 18 "Presentation and Disclosure in Financial Statements") have been issued but are not yet effective and are not expected to have a significant impact on the Group's accounting policies[15](index=15&type=chunk)[16](index=16&type=chunk) [Segment Information](index=8&type=section&id=Segment%20Information) The Group's main operating segments include Original Equipment Manufacturing (OEM), fashion retail, and property investment, with executive directors assessing performance based on profit before income tax; in H1 2025, OEM revenue remained stable, retail revenue grew significantly, and property investment revenue increased substantially - The Group has three reportable segments: Original Equipment Manufacturing (OEM), manufacturing and retail of branded fashion (Retail), and property investment in Mainland China[17](index=17&type=chunk) - Total segment assets exclude certain investment properties in Hong Kong, corporate assets, financial assets at fair value through profit or loss, and financial assets at fair value through other comprehensive income[18](index=18&type=chunk) [Segment Results for H1 2025](index=9&type=section&id=Segment%20Results%20for%20H1%202025) In H1 2025, OEM business revenue was **HKD 477.6 million**, retail business revenue was **HKD 351.8 million**, and property investment business revenue was **HKD 69.6 million**; both OEM and retail businesses recorded losses before income tax, while property investment business recorded a profit Segment Revenue and Loss/Profit Before Income Tax for H1 2025 | Segment | Revenue (thousand HKD) | Loss/Profit Before Income Tax (thousand HKD) | | :--- | :--- | :--- | | Original Equipment Manufacturing | 477,599 | (25,548) | | Retail | 351,767 | (64,307) | | Property Investment | 69,641 | 37,309 | | **Total** | **899,007** | **(52,546)** | [Segment Results for H1 2024](index=10&type=section&id=Segment%20Results%20for%20H1%202024) In H1 2024, OEM business revenue was **HKD 474.5 million**, retail business revenue was **HKD 288.8 million**, and property investment business revenue was **HKD 26.7 million**; all segments recorded losses before income tax, with the property investment segment incurring the largest loss Segment Revenue and Loss Before Income Tax for H1 2024 | Segment | Revenue (thousand HKD) | Loss Before Income Tax (thousand HKD) | | :--- | :--- | :--- | | Original Equipment Manufacturing | 474,500 | (83,261) | | Retail | 288,766 | (74,681) | | Property Investment | 26,674 | (26,989) | | **Total** | **789,940** | **(184,931)** | [Segment Assets and Geographical Revenue](index=11&type=section&id=Segment%20Assets%20and%20Geographical%20Revenue) As of June 30, 2025, the Group's total segment assets increased to **HKD 3,330.9 million**; by geographical region, Mainland China remains the primary revenue source, North America saw significant revenue growth, while revenue from other countries decreased Total Segment Assets (thousand HKD) | Segment | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Original Equipment Manufacturing | 2,095,246 | 2,028,102 | | Retail | 749,993 | 752,208 | | Property Investment | 485,668 | 468,863 | | **Total** | **3,330,907** | **3,249,173** | Geographical Revenue from External Customers (thousand HKD) | Region | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Mainland China | 625,381 | 574,861 | | North America | 191,688 | 135,724 | | European Union | 54,506 | 50,161 | | Hong Kong | 26,162 | 22,326 | | Other Countries | 1,270 | 6,868 | | **Total** | **899,007** | **789,940** | [Net Finance Costs](index=13&type=section&id=Net%20Finance%20Costs) In H1 2025, the Group's net finance costs increased significantly to **HKD 19.9 million** from **HKD 9.1 million** in the prior year, primarily due to a substantial rise in interest expenses on bank borrowings Net Finance Costs (thousand HKD) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Finance income | 279 | 975 | | Interest expense on bank borrowings | (19,310) | (11,433) | | Interest expense on lease liabilities | (1,047) | (1,212) | | Amount capitalised | 139 | 2,558 | | **Net finance costs** | **(19,939)** | **(9,112)** | [Income Tax Expense/(Credit)](index=13&type=section&id=Income%20Tax%20Expense%2F%28Credit%29) In H1 2025, the Group recorded an income tax expense of **HKD 5.8 million**, compared to an income tax credit of **HKD 47.1 million** in the prior year, mainly due to a shift from credit to expense in PRC corporate income tax and new withholding tax Income Tax Expense/(Credit) (thousand HKD) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Hong Kong Profits Tax | 2,873 | 3,121 | | PRC corporate income tax | 1,469 | (73,705) | | Withholding tax | 1,639 | — | | Deferred income tax | (155) | 23,520 | | **Total** | **5,826** | **(47,064)** | [Loss Per Share](index=14&type=section&id=Loss%20Per%20Share) In H1 2025, the basic and diluted loss per share attributable to equity holders of the Company was **4.05 HK cents**, a narrowing from **6.72 HK cents** in the prior year Loss Per Share (HK cents) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss attributable to equity holders of the Company (thousand HKD) | 85,080 | 141,189 | | Weighted average number of ordinary shares in issue (thousand shares) | 2,099,818 | 2,099,818 | | **Basic and diluted loss per share (HK cents)** | **(4.05)** | **(6.72)** | - There were no potential dilutive ordinary shares under the share option scheme for the six months ended June 30, 2025 and 2024, thus basic and diluted loss per share were the same[24](index=24&type=chunk) [Dividends](index=14&type=section&id=Dividends) The Board does not recommend the payment of interim dividends for the first half of 2025 and 2024 - The Board does not recommend the payment of interim dividends for H1 2025 and H1 2024[25](index=25&type=chunk) [Investments Accounted for Using the Equity Method](index=14&type=section&id=Investments%20Accounted%20for%20Using%20the%20Equity%20Method) As of June 30, 2025, the balance of investments accounted for using the equity method decreased to **HKD 114 thousand** from **HKD 224 thousand** on December 31, 2024, primarily due to the share of net losses Changes in Investments Accounted for Using the Equity Method (thousand HKD) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | At January 1 | 224 | 9,053 | | Share of net loss | (110) | (110) | | Impairment | — | (8,657) | | Exchange differences | — | (62) | | **Balance at end of period** | **114** | **224** | [Trade and Other Receivables](index=15&type=section&id=Trade%20and%20Other%20Receivables) As of June 30, 2025, total trade and other receivables increased to **HKD 496.3 million**, with net trade receivables at **HKD 268.9 million** and a significant increase in prepayments; the proportion of trade receivables over 180 days also rose Trade and Other Receivables (thousand HKD) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gross trade and bills receivables | 378,661 | 360,919 | | Less: Loss allowance | (109,712) | (84,958) | | **Net trade and bills receivables** | **268,949** | **275,961** | | Prepayments | 111,986 | 57,441 | | Deposits and other receivables, net | 115,388 | 115,989 | | **Total** | **496,323** | **449,391** | Ageing Analysis of Trade and Bills Receivables (thousand HKD) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | 0 to 60 days | 180,814 | 216,877 | | 61 to 120 days | 55,223 | 46,419 | | 121 to 180 days | 16,965 | 31,654 | | Over 180 days | 125,659 | 65,969 | | **Total** | **378,661** | **360,919** | [Trade and Other Payables](index=16&type=section&id=Trade%20and%20Other%20Payables) As of June 30, 2025, total trade and other payables decreased to **HKD 677.3 million** from **HKD 744.5 million** on December 31, 2024, primarily due to a reduction in accrued operating expenses and other payables Trade and Other Payables (thousand HKD) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade and bills payables | 398,384 | 387,934 | | Accrued employee benefit expenses | 30,381 | 31,650 | | Customer deposits | 77,980 | 64,949 | | VAT and other taxes payable | 16,907 | 19,457 | | Accrued operating expenses | 25,065 | 52,458 | | Other payables | 128,547 | 188,061 | | **Total** | **677,264** | **744,509** | Ageing Analysis of Trade and Bills Payables (thousand HKD) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | 0 to 30 days | 222,187 | 242,760 | | 31 to 60 days | 17,968 | 25,402 | | 61 to 90 days | 45,243 | 87,469 | | Over 90 days | 112,986 | 32,303 | | **Total** | **398,384** | **387,934** | Business and Financial Review [Business Review](index=17&type=section&id=Business%20Review) In H1 2025, the Group navigated a complex and challenging global economic environment; OEM/ODM business maintained stability by optimizing cost structures, expanding overseas production, and diversifying markets; domestic branded retail business boosted sales volume and average selling price through brand building, product innovation, and multi-channel efforts; property investment business, despite macroeconomic impacts, sustained year-on-year rental income growth - The OEM/ODM business maintained stability by reducing non-core expenses, increasing overseas production capacity, and expanding into diversified markets like Europe, Japan, and ASEAN to mitigate global trade risks and tariff uncertainties[30](index=30&type=chunk) - Domestic branded retail business significantly improved sales performance by building brand image, launching innovative fashion products, leveraging multi-channel efforts (especially e-commerce), and focusing on key consumption areas like outdoor sports[31](index=31&type=chunk) - The property investment business (Huading Industrial Park leasing) gradually recovered after international political and economic pressures, maintaining year-on-year rental income growth despite some decline in leasing prices[31](index=31&type=chunk) [Financial Review](index=18&type=section&id=Financial%20Review) In H1 2025, the Group's total revenue was **HKD 899.0 million**, a **13.8%** year-on-year increase, with gross profit at **HKD 162.8 million**, up **13.1%**; adjusted loss attributable to equity holders of the Company was **HKD 55.9 million**, and loss per share was **4.05 HK cents** Financial Review Summary for H1 2025 (million HKD) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 899.0 | 789.9 | 13.8 | | Gross Profit | 162.8 | 144.0 | 13.1 | | Fair Value Loss on Investment Properties | 8.5 | 56.3 | - | | Adjusted Loss Attributable to Equity Holders of the Company | 55.9 | 86.2 | - | | Loss Attributable to Equity Holders of the Company | 85.1 | 141.2 | - | | Loss Per Share (HK cents) | 4.05 | 6.72 | - | | Net Asset Value Per Share (HKD) | 0.73 | 0.87 | - | [Original Equipment Manufacturing Business](index=18&type=section&id=Original%20Equipment%20Manufacturing%20Business) In H1 2025, OEM business turnover slightly increased by **0.7%** to **HKD 477.6 million**, with silk, cotton, and synthetic fiber apparel remaining the main products, contributing **72.9%** of turnover; China and the US markets were still key clients, but sales to Europe and other countries grew OEM Business Turnover and Product Composition (million HKD) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | OEM Business Turnover | 477.6 | 474.5 | 0.7 | | Silk, Cotton and Synthetic Fibre Apparel | 348.1 | 299.9 | 16.1 | | Proportion of Total OEM Turnover | 72.9% | 63.2% | - | OEM Business Sales by Major Market (million HKD) | Market | H1 2025 | H1 2024 | Proportion of Total OEM Turnover (2025) | | :--- | :--- | :--- | :--- | | China and USA | 413.8 | 425.2 | 86.6% | | Europe | 46.4 | 31.1 | - | | Other Countries | 17.4 | 18.2 | - | [Fashion Retail Business](index=18&type=section&id=Fashion%20Retail%20Business) In H1 2025, fashion retail sales surged by **21.9%** to **HKD 351.8 million**, with key brands FINITY and Sprayground contributing **HKD 271.1 million**, a **40.2%** increase; e-commerce sales grew significantly, becoming a primary sales channel Fashion Retail Business Sales and Brand Contribution (million HKD) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Retail Sales | 351.8 | 288.8 | 21.9 | | FINITY and Sprayground Brand Sales | 271.1 | 193.4 | 40.2 | Retail Revenue by Sales Channel (million HKD) | Channel | H1 2025 | H1 2024 | Proportion of Total Retail Turnover (2025) | | :--- | :--- | :--- | :--- | | Counter Sales | 88.1 | 102.8 | 25.0% | | Specialty Store Sales | 8.6 | 8.0 | - | | Franchised Agent Sales | 56.7 | 52.4 | - | | E-commerce Sales | 198.4 | 125.6 | - | [Property Investment Business](index=19&type=section&id=Property%20Investment%20Business) In H1 2025, property investment business revenue surged by **160.7%** to **HKD 69.6 million**; the Huading International Fashion Industrial Park aims to promote fashion industry development and diversified business models Property Investment Business Revenue (million HKD) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Property Investment Business Revenue | 69.6 | 26.7 | 160.7 | - The Huading International Fashion Industrial Park aims to promote regional fashion industry development, localization of fashion experts, and e-commerce growth, contributing to the fashion industry in Yuhang District, Hangzhou City[35](index=35&type=chunk) Liquidity and Financial Management [Liquidity and Financial Resources](index=19&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, the Group's cash and cash equivalents increased to **HKD 195.7 million**, while total bank borrowings rose to **HKD 755.5 million**, leading to a debt-to-equity ratio of **48.1%**; the directors believe the Group possesses sufficient financial resources to support its business activities Key Liquidity and Financial Resources Metrics (million HKD) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 195.7 | 140.5 | Increase 55.2 | | Total Bank Borrowings | 755.5 | 599.5 | Increase 156.0 | | Debt-to-Equity Ratio | 48.1% | 38.1% | Increase 10.0 percentage points | - The increase in the debt-to-equity ratio was primarily due to amounts arising from the completion and availability for lease/occupancy of Huading Industrial Park[36](index=36&type=chunk) [Contingent Liabilities](index=19&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities[37](index=37&type=chunk) [Capital Expenditure and Commitments](index=21&type=section&id=Capital%20Expenditure%20and%20Commitments) In H1 2025, the Group's capital expenditure was **HKD 39.0 million**, primarily for the expansion of Huading Industrial Park Phase I and renovation of retail stores/factories; as of the period end, contracted but unprovided capital commitments amounted to **HKD 8.9 million**, mainly related to the construction of Huading Industrial Park Phase I Capital Expenditure and Commitments (million HKD) | Metric | Amount (million HKD) | | :--- | :--- | | Capital Expenditure for H1 2025 | 39.0 | | Contracted but Unprovided Capital Commitments (as of June 30, 2025) | 8.9 | - Capital expenditure was primarily for the expansion of Huading Industrial Park Phase I and the renovation of retail stores and factories[42](index=42&type=chunk) [Capital Structure](index=21&type=section&id=Capital%20Structure) In H1 2025, the Company's capital structure remained unchanged, with capital comprising solely ordinary shares - In H1 2025, the Company's capital structure remained unchanged, consisting solely of ordinary shares[44](index=44&type=chunk) [Treasury Policy and Exposure to Foreign Exchange Fluctuations](index=22&type=section&id=Treasury%20Policy%20and%20Exposure%20to%20Foreign%20Exchange%20Fluctuations) The Company uses HKD as its functional and presentation currency, with minimal foreign exchange risk from USD transactions; raw material sales and purchases are primarily denominated in USD and RMB; the Group will closely monitor foreign currency risks and may consider hedging with financial instruments, though no hedging was undertaken in H1 2025 - The Company uses HKD as its functional and presentation currency, with extremely low foreign exchange risk from USD transactions[45](index=45&type=chunk) H1 2025 Revenue and Procurement Currency Composition | Currency | Revenue Proportion | Raw Material Procurement Proportion | | :--- | :--- | :--- | | USD | 32.5% | 8.3% | | RMB | 67.5% | 91.7% | - The Group will closely monitor foreign currency risks to address ongoing currency fluctuations of RMB against USD, and may use financial instruments to mitigate currency risk if necessary, though no hedging was undertaken in H1 2025[45](index=45&type=chunk) Business Outlook [Business Outlook](index=20&type=section&id=Business%20Outlook) Facing a complex global economic environment, the Group will adhere to a "seek progress while maintaining stability, innovate for change" strategy, focusing on global production capacity layout, digital retail transformation, and diversified industrial ecosystems; OEM/ODM business will accelerate Cambodia factory optimization, deepen strategic client cooperation, and strengthen R&D; domestic retail business will enhance omni-channel integration, optimize online and offline experiences, and implement agile supply chains; Huading Industrial Park will precisely attract investment, introducing upstream and downstream enterprises and leading emerging industries, exploring diversified development paths - The Group will adhere to a "seek progress while maintaining stability, innovate for change" strategy, addressing challenges with three core strategies: global production capacity layout, digital retail transformation, and diversified industrial ecosystems[38](index=38&type=chunk) - The OEM/ODM business will accelerate Cambodia factory optimization, introduce intelligent manufacturing, deepen strategic client cooperation in North America, Europe, and RCEP, focus on high-value-added orders, and strengthen R&D in functional fabrics and smart wearables[38](index=38&type=chunk) - Domestic retail business will deepen omni-channel integration, optimize online and offline experiences, leverage big data for precise marketing, enhance brand essence through cross-industry collaborations and community operations, and implement small-batch rapid response and agile supply chains[38](index=38&type=chunk) - Huading Industrial Park will precisely attract investment, focusing on introducing upstream and downstream enterprises in the apparel industry chain, and actively promoting the entry of leading enterprises in emerging industries such as biomedicine and chip computing, exploring diversified development paths[38](index=38&type=chunk) Other Information [Interim Dividends](index=20&type=section&id=Interim%20Dividends) The Board does not recommend the payment of any interim dividends for the first half of 2025 - The Board does not recommend the payment of any interim dividends for H1 2025[40](index=40&type=chunk) [Human Resources](index=21&type=section&id=Human%20Resources) As of June 30, 2025, the Group employed **4,410** staff globally, valuing good employee relations by offering competitive remuneration, a safe and comfortable work environment, and career development opportunities, alongside mandatory retirement schemes for employees in Mainland China, Hong Kong, and Cambodia Number of Employees | Region | Number of Employees (as of June 30, 2025) | | :--- | :--- | | Mainland China, Hong Kong, Cambodia, and USA | 4,410 | - The Group provides mandatory retirement schemes for employees in Mainland China, Hong Kong, and Cambodia, but not for employees in the USA[41](index=41&type=chunk) [Events After the Reporting Period](index=21&type=section&id=Events%20After%20the%20Reporting%20Period) As of the date of this announcement, the Group had no significant events after June 30, 2025 - As of the date of this announcement, the Group had no significant events after June 30, 2025[43](index=43&type=chunk) [Purchase, Sale and Redemption of Listed Securities](index=22&type=section&id=Purchase%2C%20Sale%20and%20Redemption%20of%20Listed%20Securities) In H1 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - In H1 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[46](index=46&type=chunk) [Review of Interim Results](index=22&type=section&id=Review%20of%20Interim%20Results) The Company's Audit Committee has reviewed the unaudited interim financial information for H1 2025, discussing accounting principles, internal control systems, and financial reporting matters with management; the external auditor has reviewed this financial information in accordance with Hong Kong Standard on Review Engagements 2410 - The Company's Audit Committee has reviewed the unaudited interim financial information for H1 2025, discussing accounting principles, internal control systems, and financial reporting matters[47](index=47&type=chunk) - The external auditor, BDO Limited, Hong Kong, has reviewed the condensed consolidated interim financial information in accordance with Hong Kong Standard on Review Engagements 2410[47](index=47&type=chunk) [Corporate Governance Code](index=23&type=section&id=Corporate%20Governance%20Code) In H1 2025, the Company consistently complied with the applicable code provisions of the Corporate Governance Code under Appendix C1 Part 2 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited - In H1 2025, the Company consistently complied with the applicable code provisions of the Corporate Governance Code under Appendix C1 Part 2 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[48](index=48&type=chunk) [Standard Code for Securities Transactions by Directors](index=23&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted the Standard Code for Securities Transactions by Directors as set out in Appendix C3 of the Listing Rules, and all Directors have confirmed compliance with this Standard Code throughout H1 2025 - The Company has adopted the Standard Code for Securities Transactions by Directors as set out in Appendix C3 of the Listing Rules, and all Directors have confirmed compliance with this Standard Code throughout H1 2025[49](index=49&type=chunk) [Publication of Interim Report and Board Composition](index=23&type=section&id=Publication%20of%20Interim%20Report%20and%20Board%20Composition) The Company's interim report for H1 2025 will be published in due course on the websites of The Stock Exchange of Hong Kong Limited and the Company; as of the announcement date, the Board comprises four executive directors and three independent non-executive directors - The Company's interim report for H1 2025 will be published on the websites of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company (www.chinating.com.hk)[50](index=50&type=chunk) Board Composition (as of Announcement Date) | Category | Name | | :--- | :--- | | **Executive Directors** | | | Mr. Ding Man Er | (Chairman) | | Mr. Ding Xiong Er | (Chief Executive Officer) | | Mr. Ding Jian Er | | | Mr. Zhang Ding Xian | | | **Independent Non-executive Directors** | | | Mr. Wong Chi Keung | | | Mr. Leung Man Kit | | | Ms. Li Yuet Mui | |

[Company Information and Report Statement](index=1&type=section&id=Company%20Information%20and%20Report%20Statement) This section outlines the nature of the GEM market, disclaims responsibility for the report's content by HKEX, and affirms the board's accountability for accuracy [GEM Characteristics and Disclaimer](index=2&type=section&id=GEM%20Characteristics%20and%20Disclaimer) The report highlights GEM's high investment risks for SMEs, disclaims HKEX responsibility, and affirms the Board's accountability for accuracy - The GEM market targets small and medium-sized companies, entailing **higher investment risks** and potential for significant market volatility for securities[2](index=2&type=chunk) - Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited bear **no responsibility** for the report's content and make no representations[2](index=2&type=chunk) - The Company's directors collectively and individually assume full responsibility for the information in this report, confirming its **accuracy, completeness, and absence of misleading or fraudulent elements**[2](index=2&type=chunk) [Financial Statements](index=3&type=section&id=Financial%20Statements) This section presents the condensed consolidated financial statements, including profit or loss, comprehensive income, financial position, equity changes, and cash flows [Condensed Consolidated Statement of Profit or Loss](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For H1 2025, the Group turned from profit to a net loss, with revenue and gross profit significantly declining Key Data from Condensed Consolidated Statement of Profit or Loss (Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 330,705 | 501,609 | -34.1% | | Cost of sales and services | (307,654) | (428,129) | -28.1% | | Gross profit | 23,051 | 73,480 | -68.6% | | Loss / Profit from operations | (20,671) | 14,739 | Turned from profit to loss | | Loss / Profit for the period | (28,486) | 3,725 | Turned from profit to loss | | Attributable to owners of the Company | (24,442) | (83) | Loss widened | | Basic loss per share (HK cents) | (4.19) | (0.01) | Loss widened | [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For H1 2025, the Group recorded a significant increase in total comprehensive expense, primarily due to an expanded loss for the period Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Loss / Profit for the period | (28,486) | 3,725 | Turned from profit to loss | | Exchange differences on translation of overseas operations | 519 | (4,108) | Turned from expense to income | | Total comprehensive expense for the period | (27,967) | (383) | Loss widened | | Attributable to owners of the Company | (24,683) | (3,265) | Loss widened | [Condensed Consolidated Statement of Financial Position](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets less current liabilities improved, but it still faces significant net current liabilities and net liabilities, raising going concern uncertainties Key Data from Condensed Consolidated Statement of Financial Position (As of June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Non-current assets | 285,722 | 343,448 | -16.8% | | Current assets | 459,315 | 397,547 | +15.5% | | Current liabilities | 619,730 | 647,052 | -4.2% | | Net current liabilities | (160,415) | (249,505) | Improved | | Net liabilities | (45,916) | (17,949) | Worsened | | Equity attributable to owners of the Company | (63,678) | (38,995) | Loss widened | - As of June 30, 2025, the Group had **net current liabilities of approximately HK$160,415 thousand** and **net liabilities of approximately HK$45,916 thousand**, indicating significant uncertainties that may cast substantial doubt on its ability to continue as a going concern[13](index=13&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For H1 2025, equity attributable to owners of the Company deteriorated, primarily due to the total comprehensive expense for the period, further expanding the capital deficit Key Data from Condensed Consolidated Statement of Changes in Equity (Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Equity attributable to owners of the Company | (63,678) | (50,616) | | Capital deficit | (45,916) | (31,178) | | Total comprehensive expense for the period | (27,967) | (383) | [Condensed Consolidated Statement of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For H1 2025, the Group experienced a net decrease in cash and cash equivalents, with operating activities shifting from a net inflow to a net outflow, reflecting deteriorating operating conditions Key Data from Condensed Consolidated Statement of Cash Flows (Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net cash (used in) / generated from operating activities | (38,232) | 91,436 | | Net cash generated from / (used in) investing activities | (315) | (36,229) | | Net cash used in financing activities | (8,725) | (12,879) | | Net (decrease) / increase in cash and cash equivalents | (47,272) | 42,328 | | Cash and cash equivalents at end of period | 23,027 | 50,552 | [Notes to the Financial Statements](index=9&type=section&id=Notes%20to%20the%20Financial%20Statements) This section provides detailed notes on the Group's general information, accounting policies, and specific financial statement items [General Information and Basis of Preparation](index=9&type=section&id=General%20Information%20and%20Basis%20of%20Preparation) The Company is an investment holding company primarily engaged in coal mining, consulting, media services, and corporate and investment businesses, facing significant going concern uncertainties despite the Board's confidence in business recovery and debt negotiations - The Group primarily engages in **coal mining, consulting and media services, and corporate and investment businesses**[12](index=12&type=chunk) - As of June 30, 2025, the Group had **net current liabilities of approximately HK$160,415 thousand** and **net liabilities of approximately HK$45,916 thousand**, indicating significant going concern uncertainties[13](index=13&type=chunk) - The Board believes the Group will have **sufficient working capital**, based on the recovery of its Xinjiang coal business and active negotiations with creditors for debt repayment extensions[14](index=14&type=chunk)[16](index=16&type=chunk) [Changes in Accounting Policies](index=10&type=section&id=Changes%20in%20Accounting%20Policies) The Group has applied IAS 21 (Amendment) "Lack of Exchangeability," which had no material impact on the interim financial report, and has not adopted any new standards not yet effective - The Group has applied **IAS 21 (Amendment) "Lack of Exchangeability"**[15](index=15&type=chunk) - The aforementioned amendment had **no material impact** on the preparation or presentation of this interim financial report[15](index=15&type=chunk) [Revenue Breakdown](index=11&type=section&id=Revenue%20Breakdown) For H1 2025, the Group's revenue decreased by 34.1% to HK$330,705 thousand, primarily driven by a 30.3% decline in coal production and sales, with China (excluding Hong Kong) remaining the main revenue source Revenue Breakdown (Six Months Ended June 30) | Product/Service Line | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Production and sales of coal | 310,066 | 444,832 | -30.3% | | Supply chain management services for mining industry | 3,934 | 40,327 | -90.2% | | Mining and metallurgical machinery products | 4,698 | 8,151 | -42.4% | | Mining logistics services | 6,580 | 2,157 | +204.1% | | Trust and agency services | 1,265 | 917 | +37.9% | | Event planning services | 2,014 | 2,798 | -28.1% | | Operating railway platforms | 1,993 | 2,158 | -7.6% | | Others | 155 | 269 | -42.4% | | **Total Revenue** | **330,705** | **501,609** | **-34.1%** | Revenue by Major Geographical Market (Six Months Ended June 30) | Region | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong | 3,434 | 3,732 | | China (excluding Hong Kong) | 325,278 | 495,467 | | Others | 1,993 | 2,410 | | **Total** | **330,705** | **501,609** | [Segment Information](index=12&type=section&id=Segment%20Information) The Group operates three reportable segments: coal mining, consulting and media services, and corporate and investment businesses, with coal mining being the primary revenue source but also the main contributor to the overall loss in H1 2025 - The Group has **three reportable segments**: coal mining, consulting and media services, and corporate and investment businesses[21](index=21&type=chunk) Segment Revenue and Loss / Profit (Six Months Ended June 30) | Segment | 2025 Revenue (HK$ thousand) | 2025 Loss / Profit (HK$ thousand) | 2024 Revenue (HK$ thousand) | 2024 Profit / Loss (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Coal mining business | 327,271 | (25,379) | 497,625 | 15,067 | | Consulting and media services business | 3,344 | 209 | 3,984 | 22 | | Corporate and investment business | 90 | (3,316) | — | (11,364) | | **Total** | **330,705** | **(28,486)** | **501,609** | **3,725** | - The **coal mining business turned from profit to loss** in H1 2025, representing the primary reason for the Group's overall loss[22](index=22&type=chunk)[23](index=23&type=chunk) [Investment and Other Income](index=15&type=section&id=Investment%20and%20Other%20Income) For H1 2025, the Group's investment and other income significantly decreased to HK$418 thousand, mainly due to a sharp decline in interest income from bank deposits Investment and Other Income (Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Interest income from bank deposits | 168 | 889 | | Dividend income from equity investments | 214 | 189 | | Miscellaneous income | 36 | 105 | | **Total** | **418** | **1,183** | [Other Gains and Losses](index=16&type=section&id=Other%20Gains%20and%20Losses) For H1 2025, the Group's other gains and losses improved to a loss of HK$3,482 thousand, primarily driven by a fair value gain on financial assets at fair value through profit or loss, despite increased impairment losses on trade and other receivables Other Gains and Losses (Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net exchange loss | (52) | (357) | | Fair value gain / (loss) on financial assets at fair value through profit or loss | 1,794 | (4,253) | | Impairment loss on trade and other receivables | (5,224) | (3,947) | | **Total** | **(3,482)** | **(8,557)** | [Income Tax Credit](index=16&type=section&id=Income%20Tax%20Credit) For H1 2025, the Group's income tax credit decreased to HK$807 thousand, mainly due to a reduction in deferred tax credit Income Tax Credit (Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current tax expense | 147 | 191 | | Deferred tax credit | (954) | (1,965) | | **Total** | **(807)** | **(1,774)** | - Hong Kong and Mongolia profits tax are calculated at **16.5% and 10% respectively**, while China corporate income tax is provided at a rate of **25%**[29](index=29&type=chunk) [Loss / Profit for the Period](index=17&type=section&id=Loss%20%2F%20Profit%20for%20the%20Period) For H1 2025, the Group recorded a loss of HK$28,486 thousand, a reversal from profit, primarily influenced by cost of sales, depreciation, amortization, and impairment losses on trade receivables Components of Loss / Profit for the Period (Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Directors' emoluments | 1,860 | 2,087 | | Cost of sales | 306,787 | 395,803 | | Depreciation of property, plant and equipment | 4,288 | 5,865 | | Amortisation of intangible assets | 4,998 | 5,055 | | Fair value (gain) / loss on financial assets at fair value through profit or loss | (1,794) | 4,253 | | Impairment loss on trade and other receivables | 5,224 | 3,947 | | Net exchange loss | 52 | 357 | [Dividends](index=17&type=section&id=Dividends) The Board does not recommend the payment of any dividend for the six months ended June 30, 2025, consistent with the prior period - The Board does not recommend the payment of a dividend for the six months ended June 30, 2025 (2024: nil)[33](index=33&type=chunk) [Loss Per Share](index=18&type=section&id=Loss%20Per%20Share) For H1 2025, the loss attributable to owners of the Company was HK$24,442 thousand, leading to an expanded basic loss per share of 4.19 HK cents, with no dilutive impact on ordinary shares Loss Per Share Calculation (Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Loss for the purpose of calculating basic loss per share | (24,442) | (83) | | Weighted average number of ordinary shares (thousand shares) | 583,416 | 583,416 | | **Basic loss per share (HK cents)** | **(4.19)** | **(0.01)** | - The Company had **no potentially dilutive ordinary shares**, thus no diluted loss per share is presented[35](index=35&type=chunk) [Finance Costs](index=18&type=section&id=Finance%20Costs) For H1 2025, the Group's finance costs decreased to HK$8,622 thousand, primarily due to zero interest on bonds payable and reduced interest expenses on bank borrowings and mining rights payables Finance Costs Breakdown (Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Interest on bonds payable | — | 2,340 | | Interest portion of lease liabilities | 7 | 20 | | Interest on bank and other borrowings | 1,591 | 3,104 | | Imputed interest expense on mining rights payables | 7,024 | 7,324 | | **Total** | **8,622** | **12,788** | [Property, Plant and Equipment](index=19&type=section&id=Property%2C%20Plant%20and%20Equipment) For H1 2025, the Group's capital expenditure on property, plant and equipment significantly decreased, with purchases of approximately HK$0.7 million and no new construction in progress Property, Plant and Equipment Acquisitions (Six Months Ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Acquisition of property, plant and equipment | 700 | 7,500 | | Additions to construction in progress | — | 29,800 | [Intangible Assets](index=19&type=section&id=Intangible%20Assets) As of June 30, 2025, the Group's intangible assets, primarily mining rights, slightly increased to HK$244,493 thousand, with amortization of HK$4,998 thousand for the period Carrying Value of Mining Rights (As of June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Carrying value of mining rights | 244,493 | 242,391 | | Amortization for the period | 4,998 | 10,111 (2024 full year) | - The Group's mining rights pertain to the **production and exploration of coal mines in Xinjiang, China**, primarily long-flame coal reserves[40](index=40&type=chunk) [Trade and Bills Receivables](index=20&type=section&id=Trade%20and%20Bills%20Receivables) As of June 30, 2025, the Group's total trade and bills receivables decreased to HK$63,396 thousand, but the allowance for doubtful accounts increased, and trade receivables over one year old significantly rose, indicating heightened credit risk Trade and Bills Receivables (As of June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade receivables | 125,063 | 123,996 | | Allowance for doubtful accounts | (63,105) | (52,435) | | Bills receivables | 1,438 | 4,627 | | **Total** | **63,396** | **76,188** | Ageing Analysis of Trade and Bills Receivables (As of June 30) | Ageing | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0–30 days | 4,898 | 20,670 | | 91–365 days | 41,971 | 58,340 | | Over 1 year | 73,279 | 42,145 | - Trade receivables over **1 year old increased from HK$42,145 thousand to HK$73,279 thousand**, indicating rising long-term receivable risk[43](index=43&type=chunk) [Trade Payables](index=22&type=section&id=Trade%20Payables) As of June 30, 2025, the Group's trade payables slightly decreased to HK$12,538 thousand, but the proportion of payables over 91 days, especially those over one year, increased Ageing Analysis of Trade Payables (As of June 30) | Ageing | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0–30 days | 2,160 | 6,023 | | 91–365 days | 6,816 | 5,380 | | Over 1 year | 1,719 | 509 | | **Total** | **12,538** | **13,638** | - The carrying amount of the Group's trade payables is **denominated in RMB**[44](index=44&type=chunk) [Share Capital](index=22&type=section&id=Share%20Capital) As of June 30, 2025, the Company's authorized share capital remained at HK$500,000 thousand, with issued and fully paid share capital of HK$58,342 thousand, comprising 583,415,844 ordinary shares Share Capital Structure (As of June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Authorized share capital | 500,000 | 500,000 | | Issued and fully paid share capital | 58,342 | 58,342 | | Number of issued shares (shares) | 583,415,844 | 583,415,844 | [Contingent Liabilities](index=22&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities, consistent with the situation as of December 31, 2024 - As of June 30, 2025, the Group had **no significant contingent liabilities**[46](index=46&type=chunk) [Commitments](index=23&type=section&id=Commitments) As of June 30, 2025, the Group's total contracted but unexpended capital commitments slightly increased to HK$215,300 thousand, primarily for capital injections into subsidiaries Capital Commitments (As of June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Capital injection into subsidiaries | 206,250 | 200,302 | | Capital expenditure on property, plant and equipment | 9,050 | 8,789 | | **Total** | **215,300** | **209,091** | [Financial Assets at Fair Value Through Profit or Loss](index=23&type=section&id=Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, the Group's financial assets at fair value through profit or loss increased to HK$13,193 thousand, entirely comprising equity securities listed in Hong Kong, with a fair value gain of HK$1,794 thousand recorded during the period Financial Assets at Fair Value Through Profit or Loss (As of June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Equity securities at fair value | 13,193 | 11,399 | | Current assets | 13,193 | 11,399 | | Held for trading | 13,193 | 11,399 | - The fair value of listed securities is calculated based on **current bid prices**, providing the Group with return opportunities through dividend income and fair value gains[50](index=50&type=chunk) [Management Discussion and Analysis](index=24&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the macroeconomic environment, business performance, strategic adjustments, and financial review for the period [Macroeconomic Environment and Business Overview](index=24&type=section&id=Macroeconomic%20Environment%20and%20Business%20Overview) In H1 2025, the global economy faced geopolitical and trade challenges, with China's economy slowing and the energy sector under pressure, leading to a decline in the Group's gross profit despite administrative cost controls - Global GDP growth in H1 2025 was **3.3%**, below the pre-pandemic average (3.5%), impacted by geopolitical conflicts and tariff disputes[51](index=51&type=chunk) - China's GDP grew by **5.3% year-on-year in H1 2025**, but faced slowing growth, weak domestic demand, and pressure on the energy and mineral sectors[51](index=51&type=chunk) - The Group's gross profit decline was primarily due to **weak domestic coal market demand** and coal-consuming enterprises depleting inventory, with market recovery expected in H2[51](index=51&type=chunk) [Management and Business Strategy Adjustments](index=25&type=section&id=Management%20and%20Business%20Strategy%20Adjustments) In H1 2025, the Group implemented management adjustments, including extending a shareholder loan and promoting executives, while strategically focusing on its core Xinjiang mining business and exiting non-core operations - Former Chairman Mr. Chan Lap Kei agreed to **extend the interest-free shareholder loan to June 30, 2027**, to support the Group's financial stability[52](index=52&type=chunk) - Mr. Chan Chun Long and Mr. Ching Ho Tung, former Co-Chief Executive Officers, have been **promoted to Board members**[53](index=53&type=chunk) - The Group decided to **gradually withdraw from the public relations consulting business** to concentrate resources on core business development[57](index=57&type=chunk) [Management Adjustments](index=25&type=section&id=Management%20Adjustments) Former Chairman Mr. Chan Lap Kei extended his interest-free shareholder loan to support the Group's financial stability, while two former Co-Chief Executive Officers were promoted to the Board - Former Chairman Mr. Chan Lap Kei will **extend the interest-free shareholder loan to June 30, 2027**, to support the Group's financial stability[52](index=52&type=chunk) - Mr. Chan Chun Long and Mr. Ching Ho Tung have been **promoted to Board members**, providing support for Board decisions[53](index=53&type=chunk) [Business Strategy Adjustments](index=25&type=section&id=Business%20Strategy%20Adjustments) The Group's strategic adjustments include focusing on its core Xinjiang mineral extraction business, enhancing efficiency through technology and management, and gradually exiting non-core operations to optimize resource allocation, with an optimistic outlook for H2 coal prices - **Focus on core business**: More resources will be concentrated on the Xinjiang mineral extraction business, leveraging existing assets and exploring resource integration opportunities[54](index=54&type=chunk) - **Adjust management structure**: Optimize the leadership team to enhance strategic execution and market responsiveness[54](index=54&type=chunk) - **Gradual exit from non-core businesses**: The public relations consulting business will be discontinued to optimize resource allocation and overall strategic focus[57](index=57&type=chunk) - Domestic coal prices are expected to **rebound in H2**, maintaining an optimistic outlook for the long-term development of the Xinjiang mineral business and related operations[56](index=56&type=chunk) [Business Segment Review](index=27&type=section&id=Business%20Segment%20Review) In H1 2025, the Group's Xinjiang coal mining business generated HK$310 million in sales, while public relations ceased operations, and securities trading recorded an unrealized gain amid a strong Hong Kong stock market rebound - Xinjiang Xingliang Mining achieved **HK$310 million in sales revenue** from engineering coal business through fire extinguishing projects and sales network expansion[74](index=74&type=chunk) - The public relations consulting business ceased operations in H1 2025 due to **intensified industry competition and significant profit margin compression**[86](index=86&type=chunk) - The securities trading business recorded an **unrealized gain of HK$1,793,628** and **received dividends of HK$213,767** amid a strong rebound in Hong Kong stocks[88](index=88&type=chunk) [Production and Supply Chain Management of Mineral Resources, Mining and Metallurgical Machinery](index=27&type=section&id=Production%20and%20Supply%20Chain%20Management%20of%20Mineral%20Resources%2C%20Mining%20and%20Metallurgical%20Machinery) The Group's Shandong mining machinery production achieved HK$4.7 million in sales, while its Shandong supply chain services faced market pressure, and Xinjiang coal mining generated HK$310 million from engineering coal sales, despite a decline in Mongolia's coal output [Shandong — Production of Mining and Metallurgical Machinery](index=27&type=section&id=Shandong%20%E2%80%94%20Production%20of%20Mining%20and%20Metallurgical%20Machinery) Tengzhou Kaiyuan, a joint venture, achieved approximately HK$4.7 million in sales revenue in 2025, focusing on intelligent technology application and organizational optimization, with future demand driven by steel recovery, chemical expansion, and policy-mandated technical upgrades - Tengzhou Kaiyuan primarily produces **overhead personnel transport equipment and spare parts**, holding 50 sets of mining product safety marks and European standard certificates[59](index=59&type=chunk) - In 2025, Tengzhou Kaiyuan achieved sales revenue of approximately **HK$4.7 million**, continuously advancing its strategy for intelligent application of mining machinery equipment[63](index=63&type=chunk) - In the next six months, **steel recovery, chemical expansion, and policy-mandated technical upgrades** will drive structural growth in coal equipment demand[62](index=62&type=chunk) [Shandong — Supply Chain Management Services](index=30&type=section&id=Shandong%20%E2%80%94%20Supply%20Chain%20Management%20Services) Shandong Kailai Energy Logistics, with railway dedicated line usage rights, recorded approximately HK$10.51 million in sales revenue by June 2025, implementing strategic contraction and risk hedging amidst a challenging coal market - Shandong Kailai holds the right to use the **railway dedicated line at Guanchiao Station** of Yanzhou Car Depot, Jinan Railway Bureau, with an annual loading and unloading capacity of **3 million tonnes**[64](index=64&type=chunk) - As of June 2025, Shandong Kailai recorded cumulative sales revenue of approximately **HK$10.51 million**[67](index=67&type=chunk) - Facing an oversupplied coal market, price pressure, new energy impacts, and imported coal, the company implemented **strategic contraction and risk hedging mechanisms**[65](index=65&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk) [Xinjiang — Coal Mining Business](index=32&type=section&id=Xinjiang%20%E2%80%94%20Coal%20Mining%20Business) Xinjiang Xingliang Mining, located in the Tuha coalfield, obtained a 1.2 million tonnes/year mining permit in 2022 and initiated fire zone treatment in November 2023, achieving HK$310 million in engineering coal sales despite a slowdown in Xinjiang coal outbound transport growth - Xingliang Mining is located in the Tuha coalfield, with **long-flame coal as the main type**, and obtained a **1.2 million tonnes/year mining permit in 2022**[69](index=69&type=chunk) - From January to May 2025, Xinjiang's raw coal output increased by **9.8% year-on-year**, but the overall growth rate of Xinjiang coal outbound transport significantly slowed due to weak demand, high base effects, and limited offsetting effects from freight policies[70](index=70&type=chunk)[71](index=71&type=chunk) - Xingliang Mining completed systematic remediation of the fire zone, with cumulative sales revenue from engineering coal business reaching **HK$310 million**, covering key industrial enterprises in the region[74](index=74&type=chunk) [Mongolia — Supply Chain Management Services](index=36&type=section&id=Mongolia%20%E2%80%94%20Supply%20Chain%20Management%20Services) The Group's acquired Choir City railway platform in Mongolia, a key logistics hub, generated approximately HK$2 million in cooperation sharing revenue in 2025, despite a 12.4% year-on-year decline in Mongolia's coal production - The Choir City railway platform in Mongolia has an annual loading and unloading capacity of **1.8 million tonnes**, offering loading, unloading, warehousing, logistics, and customs clearance services[75](index=75&type=chunk) - From January to June 2025, Mongolia's coal production totaled **43.706 million tonnes**, a **12.4% year-on-year decrease**[76](index=76&type=chunk) - The Choir project generated cumulative cooperation sharing revenue of approximately **HK$2 million in 2025**, enhancing regional logistics functions through modern logistics hub construction[78](index=78&type=chunk)[80](index=80&type=chunk) [Kaisun Business Strategy Consulting and Trust](index=39&type=section&id=Kaisun%20Business%20Strategy%20Consulting%20and%20Trust) In H1 2025, the Hong Kong capital market showed signs of recovery, prompting the team to explore new opportunities in digital assets and plan to leverage AI and stablecoin policies to enhance competitiveness in H2 - In H1 2025, the Hong Kong capital market showed **signs of recovery**, driven by improved investment sentiment and industry growth momentum[84](index=84&type=chunk) - The team actively explores **new opportunities in the digital asset sector** and plans to combine AI and stablecoin policies to enhance competitive advantages[84](index=84&type=chunk) [Public Relations Business](index=40&type=section&id=Public%20Relations%20Business) In H1 2025, the public relations consulting business became unsustainable due to intensified competition, significant profit margin compression, and rising operating costs, leading the Group to cease its operations - The public relations consulting business faced **intensified industry competition and significant profit margin compression**, making sustainable profitability difficult[86](index=86&type=chunk) - The Group decided to **gradually withdraw from and cease public relations business operations** in H1 2025 to concentrate resources on its core mining business[86](index=86&type=chunk) [Securities Trading Business](index=40&type=section&id=Securities%20Trading%20Business) The Group's Hong Kong-listed securities trading business, guided by a strategy of buying blue-chip stocks at lows, recorded an unrealized gain of HK$1.79 million and received HK$0.21 million in dividends in H1 2025 amid a strong Hong Kong stock market rebound - The investment strategy involves **buying blue-chip stocks at lows** and stocks with stable dividend returns, while considering selling profitable stocks[87](index=87&type=chunk) - In H1 2025, the Hang Seng Index of Hong Kong stocks recorded a cumulative increase of nearly **25%**, becoming one of the best-performing major indices globally[87](index=87&type=chunk) Key Data from Securities Trading Business (As of June 30) | Metric | Amount (HK$) | | :--- | :--- | | Fair value of listed securities | 13,192,529 | | Cost of listed investments | 36,015,545 | | Unrealized gain | 1,793,628 | | Dividends received | 213,767 | [2025 Development Objectives](index=38&type=section&id=2025%20Development%20Objectives) The Group's 2025 development objectives include diversifying application scenarios for Shandong's mining machinery, building a specialized coal marketing system for Shandong's supply chain, establishing a standardized safety production system for Xinjiang's coal mining, and deepening strategic partnerships for Mongolia's supply chain services - Shandong mining and metallurgical machinery business objective: **Expand diversified application scenarios**, extend product lines, and drive profit growth through lean production[82](index=82&type=chunk) - Shandong supply chain management services objective: **Build a specialized coal marketing system**, cultivate a high-performance sales team, break into incremental markets, and enhance revenue and operating cash flow[81](index=81&type=chunk) - Xinjiang coal mining business objective: **Establish a standardized safety production system**, optimize organizational structure, strengthen safety and compliance control in mining operations, and promote full-chain digitalization of mining, transportation, and sales[85](index=85&type=chunk) - Mongolia supply chain management services objective: **Deepen strategic partner collaboration**, expand resource integration dimensions, and ensure long-term project operation and ecological value appreciation[83](index=83&type=chunk) [Financial Review](index=41&type=section&id=Financial%20Review) For H1 2025, the Group's revenue declined 34.1% to HK$330 million, and gross profit fell 68.6% to HK$23.1 million, primarily due to weak coal market demand and price drops, resulting in a net loss of HK$28.5 million Financial Performance Comparison (Six Months Ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 330,000 | 501,000 | -34.1% | | Gross profit | 23,100 | 73,500 | -68.6% | | Administrative and other operating expenses | 40,700 | 51,400 | -20.9% | | Other gains and losses | (3,500) | (8,600) | Improved 59.3% | | Loss from operations | (20,700) | (14,700) | Loss widened | | Total profit for the period | (28,500) | 3,700 | Turned from profit to loss | - The decrease in revenue was primarily due to **weak domestic coal market demand**, with coal-consuming enterprises mainly depleting inventory[89](index=89&type=chunk) - The significant decline in gross profit was mainly due to **falling coal prices** during the period, leading to a narrower gross profit margin[89](index=89&type=chunk) - The improvement in other gains and losses was primarily due to a **fair value gain of approximately HK$1.7 million** on financial assets at fair value through profit or loss, a reversal from a loss[90](index=90&type=chunk) [Liquidity and Financial Resources](index=44&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, the Group's bank and cash balances significantly decreased to HK$23 million, with net current liabilities of approximately HK$160 million indicating ongoing concern issues, while the capital gearing ratio remained stable at 0.06 Liquidity and Financial Resources Key Data (As of June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Bank and cash balances | 23,000 | 70,800 | | Net current liabilities | 160,000 | 249,505 | | Capital gearing ratio | 0.06 | 0.06 | - The Group's **net current liabilities position indicates ongoing concern issues**, and management will negotiate debt repayment with creditors[94](index=94&type=chunk) - The Group has **no pledged assets**, and foreign exchange risk is primarily concentrated in HKD, RMB, and USD[97](index=97&type=chunk)[99](index=99&type=chunk) [Human Resources](index=46&type=section&id=Human%20Resources) As of June 30, 2025, the Group employed 102 staff in Hong Kong and China, a slight decrease, with total staff costs increasing by 24.8% to HK$16.1 million, maintaining good employee relations through performance-based hiring and benefits Human Resources Key Data (As of June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Number of employees | 102 | 107 | | Total staff costs (Six months ended June 30, HK$ thousand) | 16,100 | 12,900 | - The Group hires, promotes, and rewards employees based on **performance and experience**, providing benefits such as provident funds[100](index=100&type=chunk) [Other Information](index=47&type=section&id=Other%20Information) This section provides updates on the Group's response to the disclaimer of opinion, directors' and substantial shareholders' interests, share schemes, and compliance with securities trading codes [Group's Response to Disclaimer of Opinion Update](index=48&type=section&id=Group%27s%20Response%20to%20Disclaimer%20of%20Opinion%20Update) The Group continues to negotiate debt repayment with creditors and extended a shareholder loan, while maintaining operational performance despite falling coal prices and planning to optimize efficiency, manage costs, and explore new business opportunities - The Company continues to **negotiate repayment arrangements** for outstanding bonds payable and accrued interest with creditors, who have agreed not to take legal action for now[107](index=107&type=chunk) - Former Director Mr. Chan Lap Kei agreed to **extend his interest-free shareholder loan to June 30, 2027**, to support the Company's financial stability and going concern[108](index=108&type=chunk) - The Group plans to **optimize operational efficiency** across business segments, prudently manage cost structures, and actively explore new business opportunities to diversify revenue sources[109](index=109&type=chunk) [Directors' and Chief Executive's Interests in Shares of the Company](index=49&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests%20in%20Shares%20of%20the%20Company) As of June 30, 2025, Mr. Chan Lap Kei held 167,263,298 shares (28.67%), Mr. Yeung Wing Shing held 1,675,000 shares (0.29%), and Mr. Chan Chun Long held 6,147,000 shares (1.05%), with no other disclosable interests Directors' and Chief Executive's Share Interests (As of June 30) | Director Name | Capacity | Number of Shares (shares) | Approximate Percentage (%) | | :--- | :--- | :--- | :--- | | Chan Lap Kei | Beneficial owner | 167,263,298 | 28.67 | | Yeung Wing Shing | Beneficial owner | 1,675,000 | 0.29 | | Chan Chun Long | Beneficial owner | 6,147,000 | 1.05 | - Mr. Chan Lap Kei resigned on July 27, 2025, but his share interests are still listed as of the end of this reporting period[111](index=111&type=chunk)[113](index=113&type=chunk) [Substantial Shareholders' Interests in Shares of the Company](index=51&type=section&id=Substantial%20Shareholders%27%20Interests%20in%20Shares%20of%20the%20Company) As of June 30, 2025, substantial shareholders Mr. Chan Lap Kei and his spouse Ms. Yeung Po Yee were deemed to hold 167,263,298 shares (28.67%), while Mr. Cheung Hung Fung and his spouse Ms. Ng Ming Kan were deemed to hold 81,950,000 shares (14.05%) Substantial Shareholders' Share Interests (As of June 30) | Shareholder Name/Entity | Capacity and Nature of Interest | Number of Shares (shares) | Approximate Percentage (%) | | :--- | :--- | :--- | :--- | | Chan Lap Kei | Beneficial owner | 167,263,298 | 28.67 | | Yeung Po Yee | Interest of spouse | 167,263,298 | 28.67 | | Cheung Hung Fung | Beneficial owner | 81,950,000 | 14.05 | | Ng Ming Kan | Interest of spouse | 81,950,000 | 14.05 | - Save as disclosed above, no other persons held interests or short positions in the shares of the Company disclosable to the Company and the Stock Exchange[117](index=117&type=chunk) [Share Schemes](index=52&type=section&id=Share%20Schemes) The Company has a 2016 Share Award Scheme, which has expired and whose shares are being transferred to the 2023 Share Award Scheme, designed to recognize contributions, provide incentives, and attract high-caliber talent - The 2016 Share Award Scheme has expired, and its shares are being transferred to the 2023 Share Award Scheme[120](index=120&type=chunk) - As of June 30, 2025, the total number of Company shares held under the 2016 Share Award Scheme was **13,610,000 shares**, representing approximately **2.33%** of the issued share capital[118](index=118&type=chunk) - The 2023 Share Award Scheme aims to **recognize contributions** from eligible participants, provide opportunities to acquire ownership interests in the Company, and **attract high-caliber talent**[122](index=122&type=chunk) - The 2023 Share Award Scheme has a scheme limit of **44,046,605 award shares**, with a minimum vesting period of **12 months**[121](index=121&type=chunk)[127](index=127&type=chunk) [2016 Share Award Scheme](index=52&type=section&id=2016%20Share%20Award%20Scheme) The 2016 Share Award Scheme, adopted on June 14, 2016, with a five-year validity, held 13,610,000 Company shares as of June 30, 2025, representing approximately 2.33% of the issued share capital, and has now expired - The 2016 Share Award Scheme was **adopted on June 14, 2016**, with a validity period of five years[118](index=118&type=chunk) - As of June 30, 2025, the total number of Company shares held under the 2016 Share Award Scheme remained at **13,610,000 shares**, representing approximately **2.33%** of the Company's issued share capital[118](index=118&type=chunk) - No shares were granted under the Share Award Scheme to any director or employee of the Company for the six months ended June 30, 2025[119](index=119&type=chunk) - The 2016 Share Award Scheme has expired, and the Company intends to **adopt a new share award scheme**[120](index=120&type=chunk) [2023 Share Award Scheme](index=53&type=section&id=2023%20Share%20Award%20Scheme) The 2023 Share Award Scheme, adopted on July 14, 2023, aims to recognize contributions and attract talent, with a limit of 44,046,605 award shares (7.55% of issued capital) and a minimum vesting period of 12 months, valid until July 13, 2033 - The 2023 Share Award Scheme was adopted on July 14, 2023, to **recognize contributions** from eligible participants and **attract high-caliber talent**[120](index=120&type=chunk)[122](index=122&type=chunk) - The scheme limit is **44,046,605 award shares**, equivalent to approximately **7.55%** of the Company's total issued shares[121](index=121&type=chunk) - Eligible participants include **directors and employees** of any member company of the Group[123](index=123&type=chunk) - The minimum vesting period for award shares is **12 months**, and the scheme is valid until **July 13, 2033**[127](index=127&type=chunk)[128](index=128&type=chunk) [Share Option Scheme](index=57&type=section&id=Share%20Option%20Scheme) The Company's Share Option Scheme, adopted on July 14, 2023, aims to recognize contributions and attract talent, with a limit of 44,046,605 options (7.55% of issued capital), a 12-month minimum vesting period, and no options granted or exercised as of June 30, 2025 - The Share Option Scheme was adopted on July 14, 2023, to **recognize contributions** from directors and employees and **attract talent**[130](index=130&type=chunk)[131](index=131&type=chunk) - The scheme limit is **44,046,605 share options**, equivalent to approximately **7.55%** of the Company's total issued shares[130](index=130&type=chunk) - The exercise price of share options is the **higher of the closing price on the grant date and the average closing price of the preceding five days**, with a minimum vesting period of **12 months**[137](index=137&type=chunk)[136](index=136&type=chunk) - The scheme is valid until **July 13, 2033**, and as of June 30, 2025, **no share options were granted, exercised, cancelled, or lapsed**[130](index=130&type=chunk)[138](index=138&type=chunk) [Directors' Interests in Competing Businesses](index=61&type=section&id=Directors%27%20Interests%20in%20Competing%20Businesses) As of June 30, 2025, no directors or their associates held any interests in businesses competing with the Group, nor were there any other conflicts of interest - Directors or their associates held **no interests in any business that competes or may compete** with the Group[141](index=141&type=chunk) - There were **no other conflicts of interest** between the directors and the Group[141](index=141&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=61&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) For the six months ended June 30, 2025, neither the Company nor its subsidiaries redeemed, purchased, sold, or redeemed any of the Company's listed securities - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries **redeemed, purchased, sold, or redeemed any of the Company's listed securities**[142](index=142&type=chunk) [Corporate Governance](index=61&type=section&id=Corporate%20Governance) This section details the Company's committee structure, membership changes, compliance with corporate governance codes, and risk management systems [Committee Structure and Membership Changes](index=61&type=section&id=Committee%20Structure%20and%20Membership%20Changes) The Company's audit, remuneration, and nomination committees are currently without members or chairs due to independent non-executive director resignations, leading the Board to review the interim results directly - The Company has established an **Audit Committee, Remuneration Committee, and Nomination and Corporate Governance Committee**[144](index=144&type=chunk) - Due to the resignation of several independent non-executive directors, all committees are **without members and chairpersons** as of the report date[143](index=143&type=chunk)[145](index=145&type=chunk) - The unaudited interim results and report for the six months ended June 30, 2025, were **reviewed by the Board**, not the Audit Committee or external auditors[145](index=145&type=chunk)[151](index=151&type=chunk) [Corporate Governance Code](index=63&type=section&id=Corporate%20Governance%20Code) For H1 2025, the Company deviated from the GEM Listing Rules' Corporate Governance Code, lacking independent non-executive directors and committee members, and failing to meet board diversity requirements, which the Board is actively addressing - The Company **failed to comply with the Corporate Governance Code** set out in Appendix C1 of the GEM Listing Rules, with multiple deviations[146](index=146&type=chunk) - The Board lacks independent non-executive directors, failing to meet the **minimum number and one-third proportion requirements** under GEM Listing Rules 5.05(1) and 5.05A[147](index=147&type=chunk) - The Audit Committee, Remuneration Committee, and Nomination and Corporate Governance Committee are **without members and chairpersons**, non-compliant with relevant GEM Listing Rules[149](index=149&type=chunk) - The Company failed to comply with GEM Listing Rule 17.104 regarding **board diversity (single-gender composition)**, with a female director expected to be appointed by the end of August 2025 to meet requirements[148](index=148&type=chunk)[150](index=150&type=chunk) [Code of Conduct Regarding Securities Transactions by Directors](index=66&type=section&id=Code%20of%20Conduct%20Regarding%20Securities%20Transactions%20by%20Directors) The Company has adopted a code of conduct for directors' securities transactions, which is no less stringent than the GEM Listing Rules' required standards, and directors have confirmed full compliance - The Company has adopted a **code of conduct for directors' securities transactions**, with terms no less stringent than the dealing restrictions required by the GEM Listing Rules[152](index=152&type=chunk) - Directors have confirmed **no non-compliance** with the required dealing restrictions and the code of conduct for securities transactions[152](index=152&type=chunk) [Risk Management and Internal Control Systems](index=66&type=section&id=Risk%20Management%20and%20Internal%20Control%20Systems) The Board conducted an annual review of the Group's risk management and internal control systems for H1 2025, deeming them effective and appropriate, covering significant financial, operational, and compliance controls - The Board conducted an **annual review of the Group's risk management and internal control systems**[153](index=153&type=chunk) - The Board considers the Group's risk management and internal control systems to be **effective and appropriate**, covering significant financial, operational, and compliance controls[153](index=153&type=chunk) [Report Signature and Disclaimer](index=66&type=section&id=Report%20Signature%20and%20Disclaimer) This section confirms the Board's approval and signing of the report, its publication details, the current Board composition, and the precedence of the English version in case of discrepancies [Board Approval and Information Release](index=66&type=section&id=Board%20Approval%20and%20Information%20Release) This report was signed by Executive Director Mr. Ching Ho Tung on behalf of the Board on August 29, 2025, published on HKEX and the Company's websites, with the English version prevailing in case of any ambiguity - This report was **signed by Executive Director Mr. Ching Ho Tung** on behalf of the Board on August 29, 2025[154](index=154&type=chunk) - This report is **published on the website of The Stock Exchange of Hong Kong Limited and the Company's website**[156](index=156&type=chunk) - As of the report date, the Board comprises **three executive directors**: Mr. Yeung Wing Shing, Mr. Chan Chun Long, and Mr. Ching Ho Tung[156](index=156&type=chunk) - In case of any discrepancy between the Chinese and English versions of this report, the **English version shall prevail**[155](index=155&type=chunk)

[Company Information and Financial Summary](index=1&type=section&id=%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF%E4%B8%8E%E8%B4%A2%E5%8A%A1%E6%91%98%E8%A6%81) [Company Profile](index=1&type=section&id=%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B) USPACE Technology Group Limited announced its unaudited interim results for the six months ended June 30, 2025 - Company Name: USPACE Technology Group Limited (洲际航天科技集团有限公司)[2](index=2&type=chunk) - Reporting Period: Unaudited interim results for the six months ended June 30, 2025[3](index=3&type=chunk) [Financial Highlights](index=1&type=section&id=%E8%B4%A2%E5%8A%A1%E6%91%98%E8%A6%81) The Group's continuing operations revenue grew by **16.5%** to **RMB 172.5 million**, gross profit surged **129.1%** to **RMB 36.2 million**, and loss attributable to equity holders decreased **54.7%** to **RMB 32.4 million**, with a significant reduction in loss per share H1 2025 Financial Highlights (Continuing Operations) | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 172.5 | 148.0 | +16.5% | | Gross Profit | 36.2 | 15.8 | +129.1% | | Loss Attributable to Equity Holders of the Company (Continuing and Discontinued Operations) | 32.4 | 71.6 | -54.7% | | Loss for the Period | 48.6 | 86.4 | -43.8% | | Basic and Diluted Loss Per Share (Continuing Operations) | 0.0643 (RMB) | 0.2144 (RMB) | -69.9% | [Condensed Consolidated Financial Statements](index=2&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's continuing operations revenue was **RMB 172,499 thousand**, gross profit **RMB 36,194 thousand**, and loss for the period **RMB 48,553 thousand**, significantly narrowed from the prior year Condensed Consolidated Statement of Profit or Loss Key Data | Metric | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 172,499 | 148,038 | | Cost of Sales | (136,305) | (132,241) | | Gross Profit | 36,194 | 15,797 | | Operating Loss | (42,969) | (76,183) | | Loss from Continuing Operations | (48,553) | (85,206) | | Loss for the Period | (48,553) | (86,398) | | Loss Attributable to Equity Holders of the Company | (32,421) | (71,637) | [Condensed Consolidated Statement of Comprehensive Income](index=4&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's total comprehensive loss was **RMB 50,386 thousand**, a reduction from **RMB 85,371 thousand** in the prior period, driven by narrowed loss and currency translation differences Condensed Consolidated Statement of Comprehensive Income Key Data | Metric | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the Period | (48,553) | (86,398) | | Currency Translation Differences | (6,897) | 3,368 | | Exchange Differences Arising from Translation of Foreign Operations | 5,064 | (2,341) | | Total Comprehensive Loss for the Period | (50,386) | (85,371) | | Total Comprehensive Loss for the Period Attributable to Equity Holders of the Company | (35,535) | (70,610) | | Basic and Diluted Loss Per Share (Continuing Operations) | RMB (6.43) cents | RMB (21.44) cents | [Condensed Consolidated Statement of Financial Position](index=5&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) As of June 30, 2025, the Group's total assets were **RMB 796,101 thousand**, total liabilities **RMB 710,271 thousand**, and total equity **RMB 85,830 thousand**, with net current liabilities of **RMB 293,040 thousand** indicating liquidity pressure Condensed Consolidated Statement of Financial Position Key Data | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Assets | 796,101 | 845,169 | | Non-current Assets | 443,549 | 485,676 | | Current Assets | 219,744 | 228,528 | | Assets Classified as Held for Sale | 132,808 | 130,965 | | Total Equity | 85,830 | 136,216 | | Total Liabilities | 710,271 | 708,953 | | Non-current Liabilities | 146,076 | 187,770 | | Current Liabilities | 564,195 | 521,183 | [Notes to the Condensed Consolidated Interim Financial Information](index=7&type=section&id=%E7%AE%80%E6%98%8E%E7%BB%BC%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B4%A2%E5%8A%A1%E8%B5%84%E6%96%99%E9%99%84%E6%B3%A8) [General Information](index=7&type=section&id=%E4%B8%80%E8%88%AC%E8%B5%84%E6%96%99) The company, incorporated in the Cayman Islands, primarily engages in aerospace (satellite manufacturing, data applications, TT&C, launch) and EMS (PCBAs assembly, full assembly electronic products) businesses - The company was incorporated as an exempted limited liability company in the Cayman Islands on **March 15, 2017**[13](index=13&type=chunk) - The Group primarily engages in aerospace business (satellite manufacturing, component manufacturing, precision electronic manufacturing, satellite data applications, satellite TT&C, satellite launch) and EMS business (PCBAs assembly and full assembly electronic product production)[13](index=13&type=chunk) - The company's shares were listed on the Main Board of the Hong Kong Stock Exchange on **August 16, 2018**[14](index=14&type=chunk) [Basis of Preparation](index=7&type=section&id=%E6%8B%9F%E5%A4%87%E5%9F%BA%E5%87%86) Interim financial information is prepared under HKAS 34 and Listing Rules, to be read with annual statements; the Group faces significant going concern uncertainties, but management has devised financing and operational plans - The interim financial information is prepared in accordance with Hong Kong Accounting Standard **34** 'Interim Financial Reporting' issued by the HKICPA and the applicable disclosure requirements of the Listing Rules[15](index=15&type=chunk) [Use of Going Concern Basis](index=8&type=section&id=%E4%BD%BF%E7%94%A8%E6%8C%81%E7%BB%AD%E7%BB%8F%E8%90%A5%E5%9F%BA%E5%87%86) The Group reported a net loss of **RMB 48,553 thousand** and net current liabilities of **RMB 293,040 thousand** for H1 2025, indicating significant going concern uncertainty; management has implemented various financing and operational strategies to address this - The Group recorded a net loss of **RMB 48,553,000** RMB for the six months ended June 30, 2025[16](index=16&type=chunk) - As of June 30, 2025, the Group's current liabilities exceeded its current assets by **RMB