Financial Performance - For the six months ended June 30, 2025, the company's revenue was approximately HKD 1,834,814,000, an increase of about HKD 132,983,000 or 7.8% compared to HKD 1,701,831,000 for the same period in 2024[5] - The gross profit margin for the six months ended June 30, 2025, was approximately 54.8%, up from 53.7% in the same period of 2024, with gross profit increasing by about HKD 91,485,000 or 10.0%[5] - EBITDA for the six months ended June 30, 2025, was approximately HKD 456,711,000, representing an increase of about HKD 81,140,000 or 21.6% compared to HKD 375,571,000 for the same period in 2024[5] - Net profit for the six months ended June 30, 2025, was approximately HKD 288,650,000, an increase of about HKD 74,295,000 or 34.7% compared to HKD 214,355,000 for the same period in 2024[5] - The total comprehensive income for the six months ended June 30, 2025, was HKD 484,260,000, a significant increase from HKD 162,909,000 in the same period of 2024, representing a growth of 197%[10] - The net profit for the period was HKD 288,650,000, compared to HKD 214,355,000 in 2024, indicating an increase of 34.6%[10] Revenue Breakdown - Revenue from the European market for the six months ended June 30, 2025, was approximately HKD 920,255,000, reflecting a growth rate of 10.9% compared to HKD 822,914,000 in the same period of 2024[6] - Revenue from the North American market decreased by 5.1% to approximately HKD 365,680,000 for the six months ended June 30, 2025, compared to HKD 385,325,000 in the same period of 2024[6] - Revenue from the Greater China market decreased by approximately 9.8% to HKD 293,176,000 for the six months ended June 30, 2025, compared to HKD 335,752,000 in the same period of 2024[7] - Revenue from fixed dental appliances was HKD 1,098,288,000, with a gross profit of HKD 631,439,000, while in 2024, revenue was HKD 1,045,387,000 with a gross profit of HKD 584,174,000, showing a growth in revenue of 5.4%[20] - Revenue from removable dental appliances increased to HKD 447,394,000 in 2025 from HKD 393,546,000 in 2024, marking a growth of 13.7%[20] - Revenue from other products reached HKD 289,132,000, up from HKD 262,898,000 in 2024, reflecting a growth of 10%[20] Dividends and Shareholder Returns - The company declared an interim dividend of HKD 0.107 per share for the six months ended June 30, 2025, compared to HKD 0.08 per share for the same period in 2024[5] - The interim dividend declared for the six months ended June 30, 2025, was HKD 100,029,000, representing an increase from HKD 75,752,000 in 2024, with a dividend per share of HKD 0.107[32] - The company repurchased 5,427,000 ordinary shares at a total cost of approximately HKD 22.44 million during the six months ended June 30, 2025, with 3,227,000 shares being cancelled[128] Acquisitions and Investments - The acquisition of Hexa Ceram contributed approximately HKD 88,700,000 to other sales during the six months ended June 30, 2025, compared to zero in the same period of 2024[7] - The company acquired 25% of Hexa Ceram for a total consideration of THB 326,216,000 on November 21, 2024[43] - The company also agreed to purchase an additional 49% of Hexa Ceram for THB 612,743,000 on the same date[44] - The acquisition of Digital Sleep Design Pty Limited was completed for a cash consideration of AUD 3,154,000, providing advanced technology for anti-snoring devices[50] - Hexa Ceram contributed HKD 103,147,000 to the group's revenue and HKD 12,710,000 to the group's profit for the six months ended June 30, 2025[49] - The fair value of identifiable assets and liabilities acquired from Hexa Ceram amounts to HKD 231,052,000, with goodwill generated from the acquisition at HKD 45,514,000[47] Financial Position and Assets - The company reported a total asset value of HKD 3,863,769,000 as of June 30, 2025, compared to HKD 3,496,596,000 at the end of 2024, an increase of 10.5%[12] - Non-current assets totaled HKD 2,727,271,000, up from HKD 2,326,274,000 in 2024, representing a growth of 17.2%[11] - Cash and cash equivalents decreased to HKD 558,034,000 from HKD 816,825,000 in 2024, a decline of 31.7%[11] - The company’s equity increased to HKD 3,076,042,000 from HKD 2,725,574,000 in 2024, indicating a growth of 12.9%[12] - Trade receivables increased from HKD 613,579,000 as of December 31, 2024, to HKD 771,719,000 as of June 30, 2025, representing a growth of approximately 25.8%[37] - Interest-bearing bank borrowings decreased from HKD 737,151,000 as of December 31, 2024, to HKD 576,857,000 as of June 30, 2025, a reduction of approximately 21.7%[41] Operational Efficiency and Expenses - Sales and distribution expenses increased by approximately 3.1% from HKD 230,896,000 for the six months ended June 30, 2024, to HKD 238,044,000 for the six months ended June 30, 2025, accounting for about 13.0% of the group's revenue[82] - Administrative expenses rose by approximately 10.2% from HKD 378,833,000 for the six months ended June 30, 2024, to HKD 417,636,000 for the six months ended June 30, 2025, representing about 22.8% of the group's revenue[83] - Other operating expenses decreased by approximately 75.0% from HKD 9,283,000 for the six months ended June 30, 2024, to HKD 2,364,000 for the six months ended June 30, 2025, accounting for about 0.1% of the group's revenue[84] - Financing costs decreased by approximately 15.2% from HKD 25,706,000 for the six months ended June 30, 2024, to HKD 21,788,000 for the six months ended June 30, 2025, representing about 1.2% of the group's revenue[85] Market Trends and Future Outlook - The company plans to focus on mid and high-value customers, aiming to exit low-margin segments to ensure long-term sustainable profitability[74] - The company is optimistic about the mid to long-term prospects in the Greater China market, driven by government procurement measures aimed at price regulation and transparency[73] - The company continues to invest in digitalization to enhance operational efficiency and customer experience, positioning itself to capture greater market share amid industry consolidation[77] - The group aims to leverage the digitalization trend in the dental industry to capture market share through advanced digital solutions[70] Corporate Governance and Compliance - The company adheres to high standards of corporate governance, ensuring transparency and accountability to protect shareholder interests[131] - The company has complied with all applicable corporate governance code provisions except for code provision C.2.1, which states that the roles of Chairman and CEO should be separate[132] - The current board structure, which includes four executive directors, one non-executive director, and four independent non-executive directors, is deemed appropriate for ensuring balanced power distribution and effective decision-making[133] - The audit committee, consisting of independent non-executive directors, has reviewed the interim results for the six months ending June 30, 2025[135] Risk Management - The group faces various business risks, including global economic fluctuations and geopolitical risks, which may impact its financial condition and operating performance[115] - The group employs legal and financial advisors for due diligence on significant acquisitions to mitigate related risks[117] - The company has no significant credit risk concentration due to a diverse customer base, which minimizes the risk of default[121] - The company faces interest rate risk primarily related to long-term debt with floating interest rates, with rates ranging from HIBOR + 0.69% to HIBOR + 0.80% for bank loans denominated in HKD[119]

Company Information [Board of Directors and Committee Composition](index=3&type=section&id=Board%20of%20Directors%20and%20Committee%20Composition) This section details board members, committee roles, and recent personnel changes, including a CFO appointment and committee reshuffle - **Dr. Markus Braun** resigned as Executive Director and CFO; **Mr. Marcus Huascar Bracklo** reassigned as Executive Director and appointed CFO[6](index=6&type=chunk) - Review Committee member change: **Mr. Marcus Huascar Bracklo** no longer a member, **Ms. Katherine Rong Xin** appointed[6](index=6&type=chunk) [Company Contact and Professional Advisors](index=3&type=section&id=Company%20Contact%20and%20Professional%20Advisors) This section lists the company's registration, principal business location, share registrar, auditor, bankers, legal counsel, website, and stock code | Item | Details | | :--- | :--- | | Company Name | EuroEyes International Eye Clinic Limited | | Stock Code | 01846 | | Registered Address | Cayman Islands | | Hong Kong Principal Place of Business | 3/F, 2000 Plaza, 2-4 Russell Street, Causeway Bay, Hong Kong SAR, China | | Auditor | PricewaterhouseCoopers | | Company Website | www.euroeyes.com | Key Financial Highlights [Financial Performance Overview](index=5&type=section&id=Financial%20Performance%20Overview) For the six months ended June 30, 2025, revenue increased by 2.4% to HKD 377.1 million, gross profit by 5.9%, but profit for the period decreased by 12.7% | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 377,125 | 368,372 | 2.4 | | Gross Profit | 156,816 | 148,013 | 5.9 | | Adjusted Gross Profit | 156,816 | 158,146 | (0.8) | | Profit for the period | 40,405 | 46,309 | (12.7) | | Adjusted Net Profit after Tax | 38,817 | 62,285 | (37.7) | [Non-IFRS Financial Measures](index=5&type=section&id=Non-IFRS%20Financial%20Measures) This section presents adjusted gross profit and adjusted net profit after tax to exclude non-cash and one-off items, providing a clearer view of core business performance - Non-IFRS financial measures (adjusted gross profit and adjusted net profit after tax) are used to eliminate the impact of non-cash items and one-off events for better understanding and assessment of the Group's business performance and operating trends[12](index=12&type=chunk)[14](index=14&type=chunk) | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Gross Profit | 156,816 | 148,013 | | Add: Pre-opening expenses | – | 9,746 | | Add: Share-based payment expenses | – | 387 | | Adjusted Gross Profit | 156,816 | 158,146 | | Profit for the period | 40,405 | 46,309 | | Add: Pre-opening expenses | – | 13,099 | | Add: Share-based payment expenses | – | 1,528 | | Add: Foreign exchange losses related to global offering proceeds | 513 | 323 | | Add: Acquisition-related costs | 628 | 2,469 | | Less: Gain on fair value change of contingent consideration payable | (2,729) | (1,443) | | Adjusted Net Profit after Tax | 38,817 | 62,285 | Independent Auditor's Report [Scope of Review and Conclusion](index=7&type=section&id=Scope%20of%20Review%20and%20Conclusion) This section confirms the auditor's review of interim financial data under ISRE 2410, finding no material issues, while clarifying it is not an audit - Auditor reviewed interim financial information per **ISRE 2410**; scope is less than an audit, so no audit opinion is expressed[16](index=16&type=chunk) - Auditor found no matters suggesting interim financial information was not prepared in all material respects according to **IAS 34 "Interim Financial Reporting"**[17](index=17&type=chunk) Interim Condensed Consolidated Statement of Financial Position [Overview of Assets, Equity, and Liabilities](index=8&type=section&id=Overview%20of%20Assets%2C%20Equity%2C%20and%20Liabilities) This section details the Group's financial position as of June 30, 2025, with total assets increasing by 13.3% to HKD 1,811.8 million, driven by growth in both current and non-current assets | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 1,811,810 | 1,599,435 | 13.28 | | Total Non-current Assets | 996,664 | 885,835 | 12.51 | | Total Current Assets | 815,146 | 713,600 | 14.23 | | Cash and Cash Equivalents | 741,782 | 653,232 | 13.56 | | Total Equity | 1,299,297 | 1,125,714 | 15.42 | | Total Liabilities | 512,513 | 473,721 | 8.19 | Interim Condensed Consolidated Statement of Comprehensive Income [Revenue and Profit Performance](index=10&type=section&id=Revenue%20and%20Profit%20Performance) This section shows a 2.4% revenue increase to HKD 377.1 million and 5.9% gross profit growth, but a 12.7% profit decrease, largely due to foreign exchange losses impacting net finance costs | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 377,125 | 368,372 | 2.4 | | Gross Profit | 156,816 | 148,013 | 5.9 | | Operating Profit | 72,554 | 65,741 | 10.36 | | Net Finance (Costs)/Income | (14,757) | 4,703 | -413.7 | | Profit for the period | 40,405 | 46,309 | (12.7) | | Total Comprehensive Income for the period | 202,230 | 32,341 | 525.3 | - Exchange differences on translation of overseas operations significantly increased from **HKD 6.4 million** in 2024 to **HKD 83.5 million** in 2025, leading to a substantial rise in total comprehensive income for the period[26](index=26&type=chunk) Interim Condensed Consolidated Statement of Changes in Equity [Analysis of Changes in Equity](index=12&type=section&id=Analysis%20of%20Changes%20in%20Equity) This section explains the increase in total equity attributable to owners to HKD 1,264.8 million, mainly from other comprehensive income, despite lower profit and dividends - Total equity attributable to owners of the Company increased from **HKD 1,092,965 thousand** as of January 1, 2025, to **HKD 1,264,762 thousand** as of June 30, 2025[30](index=30&type=chunk) - Other comprehensive income (mainly currency translation reserve) contributed a growth of **HKD 161,295 thousand**, significantly impacting total equity[30](index=30&type=chunk)[94](index=94&type=chunk) - Dividends of **HKD 9,525 thousand** were paid during the period[30](index=30&type=chunk) Interim Condensed Consolidated Statement of Cash Flows [Cash Flow Overview](index=14&type=section&id=Cash%20Flow%20Overview) This section summarizes cash flows, with operating cash slightly down, investing outflows reduced, financing outflows up, and period-end cash significantly boosted by exchange rate effects | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Net cash from operating activities | 101,605 | 102,999 | (1.35) | | Net cash used in investing activities | (34,656) | (53,243) | (34.92) | | Net cash used in financing activities | (65,509) | (57,628) | 13.68 | | Cash and cash equivalents at end of period | 741,782 | 689,561 | 7.57 | - Effect of exchange rate changes on cash and cash equivalents turned from a negative **HKD 22.8 million** in 2024 to a positive **HKD 87.1 million** in 2025[32](index=32&type=chunk) Notes to the Condensed Consolidated Financial Information [1 General Information](index=15&type=section&id=1%20General%20Information) This section describes the Group's core business of vision correction services across Germany, Denmark, the UK, and China, its Cayman Islands registration, and Hong Kong listing - The Group primarily provides vision correction services in Germany, Denmark, the UK, and China[33](index=33&type=chunk) - The Company is listed on The Stock Exchange of Hong Kong Limited, and this interim financial information is unaudited[33](index=33&type=chunk)[34](index=34&type=chunk) [2 Basis of Preparation](index=15&type=section&id=2%20Basis%20of%20Preparation) This section states that the condensed consolidated financial information is prepared under IAS 34 and should be read with the 2024 annual financial statements - This condensed consolidated financial information is prepared in accordance with **IAS 34 "Interim Financial Reporting"**[35](index=35&type=chunk) - This report should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024[35](index=35&type=chunk) [3 Accounting Policies](index=15&type=section&id=3%20Accounting%20Policies) This section confirms consistency with prior year accounting policies, notes the adoption of one new standard with no material impact, and highlights IFRS 18's expected effect on profit or loss presentation - Amendments to **IAS 21 – Lack of Exchangeability** adopted, with no significant impact on amounts recognized in prior or current periods[37](index=37&type=chunk) - **IFRS 18 "Presentation and Disclosure in Financial Statements"** is expected to affect the presentation of the statement of profit or loss[38](index=38&type=chunk) [4 Financial Risk Management](index=17&type=section&id=4%20Financial%20Risk%20Management) This section addresses the Group's exposure to market, credit, and liquidity risks, detailing management strategies for each - The Group's business activities are exposed to market risks (including foreign currency risk and interest rate risk), credit risk, and liquidity risk[41](index=41&type=chunk) - If HKD depreciates/appreciates by **5%** against EUR, profit after tax for the six months ended June 30, 2025, would increase/decrease by approximately **HKD 4,286,000**[42](index=42&type=chunk) Financial Liabilities Maturity as of June 30, 2025 | Financial Liabilities Maturity | Less than 1 year (HKD thousands) | 1 to 2 years (HKD thousands) | 2 to 5 years (HKD thousands) | Over 5 years (HKD thousands) | Total Contractual Cash Flows (HKD thousands) | Carrying Amount (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Trade payables | 38,882 | – | – | – | 38,882 | 38,882 | | Accrued expenses and other payables | 16,916 | – | – | – | 16,916 | 16,916 | | Borrowings | 995 | – | – | – | 995 | 995 | | Contingent consideration payable | 47,780 | 6,657 | 6,657 | – | 61,094 | 58,185 | | Lease liabilities | 77,556 | 61,815 | 142,885 | 94,883 | 377,139 | 344,454 | | **Total** | **182,129** | **68,472** | **149,542** | **94,883** | **495,026** | **459,432** | - Contingent consideration payable is classified as a **Level 3 financial liability**, with fair value estimated by discounting future cash flows, primarily influenced by risk-adjusted discount rates and expected revenue growth rates[51](index=51&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk) [5 Critical Accounting Estimates and Judgements](index=21&type=section&id=5%20Critical%20Accounting%20Estimates%20and%20Judgements) This section explains that financial statement preparation involves continuous evaluation of estimates and judgments, consistent with the 2024 annual report - Estimates and judgments are continuously evaluated, and based on past experience and other factors (including expectations of future events considered reasonable in the circumstances)[57](index=57&type=chunk) - In preparing this condensed consolidated financial information, the critical judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty are consistent with those applied in the consolidated financial statements for the year ended December 31, 2024[58](index=58&type=chunk) [6 Segment Information](index=22&type=section&id=6%20Segment%20Information) This section divides the Group's operations into four reportable segments (Germany, China, Denmark, UK) and assesses their performance using key financial metrics - The Company's executive directors review the Group's performance by product and geography, identifying four reportable segments: **Germany, China, Denmark, and the UK**[61](index=61&type=chunk) Revenue by Segment for the six months ended June 30, 2025 | Segment | Revenue (HKD thousands) | % of Total Revenue | | :--- | :--- | :--- | | Germany segment | 206,083 | 54.6 | | China segment | 73,776 | 19.6 | | Denmark segment | 40,447 | 10.7 | | UK segment | 61,970 | 16.4 | | **Total** | **377,125** | **100.0** | Non-current Assets by Location | Non-current Assets by Location | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Germany | 393,600 | 313,225 | | UK | 339,134 | 306,300 | | China | 164,957 | 177,069 | | Denmark | 57,217 | 54,523 | | **Total** | **954,908** | **851,117** | [7 Revenue](index=26&type=section&id=7%20Revenue) This section details the Group's revenue sources, primarily vision correction services, totaling HKD 377.1 million, with regional contributions and contract liabilities disclosed - Revenue generated from external customers primarily comes from providing vision correction services and leasing ophthalmic equipment and operating rooms[68](index=68&type=chunk) Revenue by Category | Revenue Category | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Provision of vision correction services | 373,343 | 364,492 | | Training services | 2,310 | 1,961 | | Leasing of ophthalmic equipment and operating rooms | 1,455 | 1,919 | | Sales of pharmaceutical products | 17 | – | | **Total** | **377,125** | **368,372** | Revenue by Origin | Revenue by Origin | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Germany | 200,932 | 201,122 | | Mainland China | 73,776 | 75,607 | | UK | 61,970 | 57,881 | | Denmark | 40,447 | 33,762 | | **Total** | **377,125** | **368,372** | - As of June 30, 2025, the balance of contract liabilities at period-end was **HKD 18,925 thousand**, an increase from the same period last year[74](index=74&type=chunk) [8 Expenses by Nature](index=29&type=section&id=8%20Expenses%20by%20Nature) This section categorizes the Group's total expenses of HKD 310.9 million, identifying employee benefits, depreciation, and raw materials as major components | Expense Category | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Employee benefit expenses | 122,204 | 123,470 | | Depreciation of property, plant and equipment | 56,735 | 52,532 | | Raw materials and consumables | 46,846 | 52,074 | | Advertising and marketing expenses | 30,771 | 24,747 | | Utilities and property management expenses | 13,602 | 13,414 | | Clinic, office and consumable expenses | 12,276 | 9,924 | | Legal and other consulting service fees | 9,154 | 9,253 | | Repairs and maintenance | 6,245 | 6,308 | | Transportation costs | 5,749 | 5,119 | | Amortisation of intangible assets | 2,532 | 2,445 | | Doctors' fees | 2,335 | 2,581 | | Others | 2,402 | 3,565 | | **Total** | **310,851** | **305,432** | [9 Employee Benefit Expenses](index=29&type=section&id=9%20Employee%20Benefit%20Expenses) This section breaks down total employee benefit expenses of HKD 122.2 million, with wages and salaries as the largest component and no share-based payments this period | Expense Category | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Wages and salaries | 107,446 | 107,833 | | Contributions to defined contribution retirement schemes | 12,208 | 11,664 | | Employee benefits and housing schemes | 2,550 | 2,445 | | Share-based payments | – | 1,528 | | **Total** | **122,204** | **123,470** | [10 Other Net Income](index=30&type=section&id=10%20Other%20Net%20Income) This section reports a significant increase in other net income to HKD 6.3 million, driven by gains on contingent consideration and asset disposals | Income Category | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Gain on fair value change of contingent consideration payable | 2,729 | 1,444 | | Gain/(loss) on disposal of property, plant and equipment | 1,643 | (93) | | Insurance compensation | 719 | 1,146 | | Others | 1,180 | 321 | | **Total** | **6,271** | **2,818** | [11 Net Finance Income and Costs](index=30&type=section&id=11%20Net%20Finance%20Income%20and%20Costs) This section explains the shift from net finance income to a HKD 14.8 million loss, primarily due to decreased interest income and increased foreign exchange losses | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Finance income | 7,853 | 13,023 | | Finance costs | (22,610) | (8,320) | | **Net Finance (Costs)/Income** | **(14,757)** | **4,703** | - Net finance costs turned from income in the prior period to a loss, mainly due to decreased interest income and a significant increase in net foreign exchange losses[78](index=78&type=chunk) [12 Income Tax Expense](index=31&type=section&id=12%20Income%20Tax%20Expense) This section details the Group's income tax expense of HKD 17.4 million, a decrease from the prior year, mainly due to higher deferred income tax credits | Expense Category | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Current income tax | 23,577 | 26,173 | | Deferred income tax credit | (6,185) | (2,038) | | **Income Tax Expense** | **17,392** | **24,135** | - The Group is subject to income tax in various jurisdictions (including Germany, Denmark, the UK, mainland China, and Hong Kong) with tax rates ranging from **8.25% to 32%**[79](index=79&type=chunk) [13 Earnings Per Share](index=31&type=section&id=13%20Earnings%20Per%20Share) This section presents basic and diluted earnings per share, both declining due to lower profit attributable to owners Basic Earnings Per Share | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit attributable to owners of the Company (HKD thousands) | 38,403 | 44,154 | | Weighted average number of ordinary shares in issue (thousands) | 320,053 | 331,701 | | **Basic earnings per share (HK cents)** | **11.999** | **13.311** | Diluted Earnings Per Share | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit attributable to owners of the Company (HKD thousands) | 38,403 | 44,154 | | Weighted average number of ordinary and potential ordinary shares in issue (thousands) | 320,093 | 331,958 | | **Diluted earnings per share (HK cents)** | **11.997** | **13.301** | [14 Dividends](index=32&type=section&id=14%20Dividends) This section states the Board's recommendations for a final dividend for 2024 and an interim dividend for the first half of 2025 - The Board recommended a final dividend of **HKD 0.0297** per ordinary share for the year ended December 31, 2024, totaling **HKD 9,524,968**, paid in June 2025[86](index=86&type=chunk) - The Board recommended an interim dividend of **HKD 0.0315** per ordinary share for the six months ended June 30, 2025, totaling **HKD 10,102,239**, which was not recognized as a liability as of June 30, 2025[86](index=86&type=chunk) [15 Property, Plant and Equipment, Intangible Assets and Goodwill](index=33&type=section&id=15%20Property%2C%20Plant%20and%20Equipment%2C%20Intangible%20Assets%20and%20Goodwill) This section reports increases in the net book value of property, plant and equipment, intangible assets, and goodwill, influenced by additions and exchange differences Net Book Value | Metric | June 30, 2025 (HKD thousands) | June 30, 2024 (HKD thousands) | | :--- | :--- | :--- | | Net book value of property, plant and equipment at period-end | 623,777 | 599,801 | | Net book value of intangible assets at period-end | 32,773 | 33,688 | | Net book value of goodwill at period-end | 298,358 | 284,908 | - Additions to property, plant and equipment during the period were **HKD 63,194 thousand**, with exchange differences increasing by **HKD 51,736 thousand**[87](index=87&type=chunk) - Exchange differences on goodwill increased by **HKD 44,951 thousand** during the period[88](index=88&type=chunk) [16 Trade Receivables](index=35&type=section&id=16%20Trade%20Receivables) This section shows an increase in net trade receivables to HKD 14.2 million, primarily from short-term balances, with a slight rise in impairment provisions Trade Receivables | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Gross trade receivables | 14,973 | 5,469 | | Less: Impairment provision | (802) | (731) | | **Net trade receivables** | **14,171** | **4,738** | - Most of the Group's sales require upfront payments from customers, with the remaining balances primarily receivables from credit payments and insurance companies; all trade receivables are within **6 months**[89](index=89&type=chunk) [17 Cash and Cash Equivalents](index=36&type=section&id=17%20Cash%20and%20Cash%20Equivalents) This section details the increase in cash and cash equivalents to HKD 741.8 million, mainly bank cash, with applicable interest rates Cash and Cash Equivalents | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Cash on hand | 28 | 33 | | Bank cash | 741,754 | 653,199 | | **Total** | **741,782** | **653,232** | - For the period ended June 30, 2025, the Group earned interest on bank cash at floating bank deposit rates ranging from **0.00% to 2.30%** per annum[90](index=90&type=chunk) [18 Share Capital](index=36&type=section&id=18%20Share%20Capital) This section reports the Company's issued and fully paid share capital of HKD 25.2 million, reflecting a decrease in total shares due to repurchased share cancellations Share Capital | Metric | Number of Shares 2025 | Number of Shares 2024 | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Balance at beginning of period (issued and fully paid) | 331,523,000 | 333,240,000 | 26,004 | 26,138 | | Shares cancelled | (10,817,000) | (300,000) | (841) | (23) | | **Balance at end of period (issued and fully paid)** | **320,706,000** | **332,940,000** | **25,163** | **26,115** | [19 Shares Held for Share Schemes](index=37&type=section&id=19%20Shares%20Held%20for%20Share%20Schemes) This section discloses the number and value of shares held for share schemes, noting a significant decrease due to cancellations Shares Held for Share Schemes | Metric | June 30, 2025 Number of Shares | December 31, 2024 Number of Shares | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Shares held for share schemes | 1,203,861 | 6,803,861 | 5,985 | 30,826 | - During the period, the trustee acquired **5,217,000** shares and cancelled **10,817,000** shares[93](index=93&type=chunk) [20 Other Reserves](index=38&type=section&id=20%20Other%20Reserves) This section explains the increase in total other reserves to HKD 164.0 million, largely driven by a substantial rise in the currency translation reserve Other Reserves | Reserve Category | June 30, 2025 (HKD thousands) | January 1, 2025 (HKD thousands) | | :--- | :--- | :--- | | Capital reserve – contributed surplus | 92,132 | 92,132 | | Capital reserve – share-based payments | 6,349 | 6,349 | | Currency translation reserve | 70,457 | (90,838) | | Other | (4,899) | (4,899) | | **Total** | **164,039** | **2,744** | - Currency translation reserve significantly increased by **HKD 161,295 thousand** due to exchange differences on translation of overseas operations[94](index=94&type=chunk) [21 Share-based Payments](index=38&type=section&id=21%20Share-based%20Payments) This section describes the restricted share award scheme, noting no new grants this period and 40,000 unexercised restricted shares remaining - The Company adopted a ten-year restricted share award scheme on March 19, 2020, to incentivize skilled and experienced personnel and recognize contributions[95](index=95&type=chunk) - No further share-based payments have been granted since 2025[97](index=97&type=chunk) - As of June 30, 2025, **40,000** restricted shares remained unexercised[98](index=98&type=chunk) [22 Trade Payables](index=39&type=section&id=22%20Trade%20Payables) This section details the increase in trade payables to HKD 38.9 million, primarily due within three months Trade Payables Ageing | Ageing | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 27,945 | 22,373 | | Over 3 months but not exceeding 6 months | 10,937 | 2,674 | | **Total** | **38,882** | **25,047** | - Trade payables are unsecured and typically settled within **6 months** of recognition[99](index=99&type=chunk) [23 Borrowings](index=39&type=section&id=23%20Borrowings) This section reports the Group's borrowings of HKD 995 thousand, mainly short-term bank overdrafts, and available undrawn borrowing facilities Borrowings | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Bank overdrafts due within 1 year | 995 | 853 | Undrawn Borrowing Facilities (Floating Rate) | Undrawn Borrowing Facilities (Floating Rate) | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Due after one year | 9,214 | 8,127 | [24 Leases](index=40&type=section&id=24%20Leases) This section summarizes the Group's right-of-use assets of HKD 321.4 million and total lease liabilities of HKD 344.5 million, along with total lease payments Lease Assets and Liabilities | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Right-of-use assets | 321,392 | 298,107 | | Lease liabilities (current) | 74,391 | 67,859 | | Lease liabilities (non-current) | 270,063 | 250,574 | | **Total lease liabilities** | **344,454** | **318,433** | - Total cash outflow from leases for the six months ended June 30, 2025, was **HKD 36,828 thousand**[103](index=103&type=chunk) Changes in Lease Liabilities | Lease Liabilities Change | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Balance at beginning of period | 318,433 | 383,334 | | Lease payments | (36,828) | (35,528) | | Accrued interest | 4,457 | 5,238 | | Increase in right-of-use assets | 33,748 | 3,099 | | Lease modifications | (1,164) | – | | Exchange differences | 25,808 | (6,403) | | **Balance at end of period** | **344,454** | **349,740** | [25 Commitments](index=42&type=section&id=25%20Commitments) This section confirms the absence of any significant contracted or authorized but uncontracted capital commitments for the Group - As of 2025 and 2024, the Group had no contracted but unprovided capital commitments, nor any capital commitments authorized by the Board but not contracted[106](index=106&type=chunk) [26 Related Party Transactions](index=43&type=section&id=26%20Related%20Party%20Transactions) This section outlines various transactions with related parties, including lease payments, service provision, and goods sales/purchases, and key management compensation - Key related parties include **Dr. Jørn Slot Jørgensen** (ultimate controlling party), **Dr Jørgensen und Kollegen GbR**, and **London Vision Clinic Limited**[108](index=108&type=chunk) Related Party Transactions | Transaction Type | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Lease payments (London Vision Clinic Limited) | 2,589 | 2,533 | | Services provided to related parties | 642 | 1,435 | | Sales of goods to related parties (Dr Jørgensen und Kollegen GbR) | 9 | – | | Purchases of goods from related parties (Dr Jørgensen und Kollegen GbR) | 60 | – | Key Management Personnel Compensation | Key Management Personnel Compensation | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Salaries and other short-term employee benefits | 6,605 | 6,554 | | Share-based payments | – | 934 | | Directors' fees | 1,367 | 693 | | **Total** | **7,972** | **8,181** | [27 Events After the Reporting Period](index=44&type=section&id=27%20Events%20After%20the%20Reporting%20Period) This section states that no significant events occurred after June 30, 2025, requiring adjustments or additional disclosures - No significant events occurred after June 30, 2025, that would require adjustment to or additional disclosure in this interim condensed consolidated financial information[113](index=113&type=chunk) Management Discussion and Analysis [Business Review](index=45&type=section&id=Business%20Review) This section highlights the Group's record revenue of HKD 377.1 million, strong growth in lens exchange surgeries, increased EBITDA, but a decline in net profit due to foreign exchange losses - The Group's total revenue reached a new record of **HKD 377.1 million**, an increase of **2.4%** from the previous year[114](index=114&type=chunk) - Revenue from lens exchange surgeries reached a new high of **HKD 218.6 million** during the period, an increase of **10.0%** from the same period in 2024, accounting for **58.0%** of the Group's total revenue[114](index=114&type=chunk)[119](index=119&type=chunk) - The Group's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) returned to growth, increasing by **9.2%** year-on-year to **HKD 131.8 million**[115](index=115&type=chunk) - Net profit attributable to equity holders of the Group decreased by **13.0%** year-on-year to **HKD 38.4 million**, primarily due to non-cash translation losses from the appreciation of the Euro against RMB and HKD[115](index=115&type=chunk) [Performance by Region](index=45&type=section&id=Performance%20by%20Region) This section details revenue and surgery type performance across Germany, China, the UK, and Denmark, noting regional growth trends - Germany's total revenue was **HKD 200.9 million**, with lens exchange surgery revenue soaring **2.8%** to **HKD 121.4 million**, and Presbyond revenue jumping to **HKD 3.6 million**[116](index=116&type=chunk) - China's total revenue was **HKD 73.8 million**, a year-on-year decrease of **2.4%**. Lens exchange surgery revenue surged **5.1%** to **HKD 46.6 million**, and Presbyond surgery revenue climbed to **HKD 1.8 million**[117](index=117&type=chunk) - UK revenue was **HKD 62.0 million**, a strong year-on-year increase of **7.1%**, mainly driven by the opening of the new flagship clinic in London. Lens exchange surgeries and ICL implantations respectively soared **141.3%** and **55.7%**[118](index=118&type=chunk) - Denmark's revenue was **HKD 40.4 million**, a year-on-year increase of **19.8%**, with lens exchange surgery revenue climbing **21.8%** to **HKD 37.8 million**[118](index=118&type=chunk) [Performance by Surgery Type](index=46&type=section&id=Performance%20by%20Surgery%20Type) This section analyzes revenue contributions from different surgery types, highlighting lens exchange as the primary growth driver and subdued demand for myopia treatments - Revenue from lens exchange surgeries increased by **10.0%** year-on-year to **HKD 218.6 million**, accounting for **58.0%** of total revenue, serving as the primary growth driver[119](index=119&type=chunk) - Revenue from Presbyond laser blended vision surgery was **HKD 17.9 million**, accounting for **4.7%** of total revenue, an increase from the previous year[120](index=120&type=chunk) - Revenue from ICL implantations decreased by **15.9%** year-on-year to **HKD 33.6 million**, and refractive laser surgery revenue decreased by **7.7%** year-on-year to **HKD 92.2 million**, reflecting subdued demand for myopia treatment[121](index=121&type=chunk)[122](index=122&type=chunk) [Outlook and Future Strategies](index=47&type=section&id=Outlook%20and%20Future%20Strategies) This section outlines the Group's confidence in recovery and three growth pillars: enhancing presbyopia treatment leadership, maturing new clinics, and active M&A, targeting high CAGR - The Group expects to achieve a low-to-mid **10%** organic compound annual growth rate (CAGR) for revenue, a high **10%** organic EBITDA CAGR, and a low **20%** organic net profit CAGR by 2028[123](index=123&type=chunk) - First organic growth pillar: enhancing market leadership in presbyopia treatment, especially trifocal lens exchange surgeries, with demand expected to continue increasing and be more resilient to economic downturns[124](index=124&type=chunk) - Second organic growth pillar: new clinics reaching maturity, with the London flagship clinic and new German clinics achieving monthly EBITDA break-even, anticipating significant profitability growth in the coming years[125](index=125&type=chunk) - External growth pillar: rapidly advancing M&A strategy, targeting reputable private eye clinics in Europe, not excluding the Americas, with more M&A deals expected to be announced in 2025[127](index=127&type=chunk) [Financial Review](index=48&type=section&id=Financial%20Review) This section presents a comprehensive analysis of the Group's financial performance, including revenue, costs, profits, financing, risks, and liquidity, along with global offering proceeds utilization [1. Revenue](index=48&type=section&id=1.%20Revenue) This section reports total revenue of HKD 377.1 million, a 2.4% increase, driven by strong growth in lens exchange surgeries across all regions - The Group's total revenue for the period was **HKD 377.1 million**, a year-on-year increase of **2.4%**, primarily due to strong growth in lens exchange surgeries for presbyopia treatment across all four regions[129](index=129&type=chunk) Revenue by Origin | Revenue by Origin | 2025 (HKD thousands) | % of Total Revenue | | :--- | :--- | :--- | | Germany | 200,932 | 53.3 | | China | 73,776 | 19.6 | | UK | 61,970 | 16.4 | | Denmark | 40,447 | 10.7 | | **Total** | **377,125** | **100.0** | [2. Cost of Revenue](index=49&type=section&id=2.%20Cost%20of%20Revenue) This section details the cost of revenue at HKD 220.3 million, largely consistent with the prior year, with employee benefits and raw materials as key components - The Group's cost of revenue for the period was largely consistent with the previous year at **HKD 220.3 million**, mainly due to a **10.0%** decrease in raw materials and consumables costs[132](index=132&type=chunk)[133](index=133&type=chunk) - The largest components of cost of revenue remain employee benefit expenses (**25.4%** of total revenue) and raw materials and consumables (**12.4%** of total revenue)[131](index=131&type=chunk) [3. Gross Profit and Gross Margin](index=49&type=section&id=3.%20Gross%20Profit%20and%20Gross%20Margin) This section provides a comparative analysis of gross profit and gross margin, including adjusted figures, showing a 5.9% increase in gross profit | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 156,816 | 148,013 | 5.9 | | Gross Margin | 41.6% | 40.2% | 1.4 percentage points | | Adjusted Gross Profit | 156,816 | 158,146 | (0.8) | | Adjusted Gross Margin | 41.6% | 42.9% | -1.3 percentage points | [4. Selling Expenses](index=50&type=section&id=4.%20Selling%20Expenses) This section reports a 14.9% increase in selling expenses to HKD 41.8 million, primarily due to higher advertising and marketing costs - The Group's selling expenses were **HKD 41.8 million**, a **14.9%** increase from 2024, primarily due to a **24.9%** increase in advertising and marketing expenses[135](index=135&type=chunk)[136](index=136&type=chunk) - Selling expenses as a percentage of the Group's total revenue increased from **9.9%** last year to **11.1%** this period[135](index=135&type=chunk) [5. Administrative Expenses](index=50&type=section&id=5.%20Administrative%20Expenses) This section states administrative expenses were HKD 48.8 million, consistent with the prior year, with a slight decrease as a percentage of total revenue - The Group's administrative expenses were **HKD 48.8 million**, largely consistent with last year's figures[137](index=137&type=chunk)[138](index=138&type=chunk) - Administrative expenses as a percentage of the Group's total revenue slightly decreased from **13.2%** last year to **12.9%** this period[137](index=137&type=chunk) [6. Net Finance Income and Costs](index=50&type=section&id=6.%20Net%20Finance%20Income%20and%20Costs) This section explains the shift to a net finance cost of HKD 14.8 million, driven by reduced interest income and increased foreign exchange losses - The Group's finance income was **HKD 7.9 million**, a **39.7%** decrease from the same period in 2024, mainly due to lower interest rates on cash accounts[139](index=139&type=chunk) - Finance costs increased by **171.8%** from **HKD 8.3 million** to **HKD 22.6 million**, primarily due to foreign exchange losses in the China segment caused by the appreciation of the Euro[139](index=139&type=chunk) [7. Borrowings](index=51&type=section&id=7.%20Borrowings) This section details outstanding borrowings of approximately HKD 1 million, mainly short-term bank overdrafts, and notes the fixed-rate nature of borrowings - As of June 30, 2025, the Group had outstanding borrowings of approximately **HKD 1 million**, repayable within one year, mainly related to bank overdrafts[140](index=140&type=chunk) - Borrowings are denominated in GBP, and the Group's borrowings bear interest at fixed rates, so the risk exposure is not significant[141](index=141&type=chunk) [8. Foreign Exchange Risk](index=51&type=section&id=8.%20Foreign%20Exchange%20Risk) This section discusses foreign exchange risk primarily from HKD-denominated cash and payables, quantifying the impact of EUR exchange rate fluctuations on profit - Foreign exchange risk primarily arises from the Company's cash and cash equivalents and other payables denominated in HKD[143](index=143&type=chunk) - If HKD depreciates or appreciates by **5%** against EUR, profit after tax for the six months ended June 30, 2025, would increase/decrease by approximately **HKD 4,286,000**[143](index=143&type=chunk) - The Group had no exchange rate-related hedges as of June 30, 2025, but will closely monitor exchange rate fluctuation risks[143](index=143&type=chunk) [9. Pledge of Group Assets](index=51&type=section&id=9.%20Pledge%20of%20Group%20Assets) This section confirms that the Group had not pledged any of its assets as of the reporting dates - As of June 30, 2025, and December 31, 2024, the Group had not pledged its assets[144](index=144&type=chunk) [10. Capital Commitments](index=51&type=section&id=10.%20Capital%20Commitments) This section states that the Group had no significant capital commitments as of June 30, 2025 - As of June 30, 2025, the Group had no significant capital commitments[145](index=145&type=chunk) [11. Contingent Liabilities](index=51&type=section&id=11.%20Contingent%20Liabilities) This section identifies contingent consideration payable related to the acquisitions of London Vision Clinic Partners Ltd. and FreeVis GmbH - The Group's contingent consideration payable of approximately **HKD 39.7 million** is related to the acquisition of London Vision Clinic Partners Ltd[146](index=146&type=chunk) - The Group's contingent consideration payable of approximately **HKD 18.5 million** is related to the acquisition of FreeVis GmbH[146](index=146&type=chunk) [12. Significant Acquisitions and Disposals of Subsidiaries, Associates, and Joint Ventures](index=52&type=section&id=12.%20Significant%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%2C%20and%20Joint%20Ventures) This section reports no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the period - For the six months ended June 30, 2025, there were no significant acquisitions or disposals of subsidiaries, associates, and joint ventures[147](index=147&type=chunk) [13. Significant Investments](index=52&type=section&id=13.%20Significant%20Investments) This section confirms that the Group made no significant investments during the six months ended June 30, 2025 - The Group had no significant investments for the six months ended June 30, 2025[148](index=148&type=chunk) [14. Major Investment or Capital Asset Plans](index=52&type=section&id=14.%20Major%20Investment%20or%20Capital%20Asset%20Plans) This section states that the Group had no major investment or capital asset plans beyond those disclosed in the prospectus and related to property, plant, and equipment additions - Other than those disclosed in the prospectus and capital commitments related to additions to property, plant and equipment, the Group had no other major investment or capital asset plans[149](index=149&type=chunk) [15. Liquidity and Financial Resources](index=52&type=section&id=15.%20Liquidity%20and%20Financial%20Resources) This section describes the Company's funding sources, including operational cash and global offering proceeds, and reports on cash and cash equivalents and the current asset to liability ratio - The Company's primary sources of funds are cash generated from the Group's business operations and proceeds from the Company's global offering[150](index=150&type=chunk) - As of June 30, 2025, the Group's cash and cash equivalents were approximately **HKD 741.8 million**[150](index=150&type=chunk) - As of June 30, 2025, the Group's current asset to liability ratio (current assets divided by current liabilities) was approximately **3.8 times**, while it was **4.7 times** as of December 31, 2024[150](index=150&type=chunk) [16. Use of Proceeds from Global Offering](index=53&type=section&id=16.%20Use%20of%20Proceeds%20from%20Global%20Offering) This section details the planned and actual utilization of the HKD 660.66 million net proceeds from the global offering - The net proceeds from the Company's global offering were approximately **HKD 660.66 million**[152](index=152&type=chunk) Use of Net Proceeds | Use of Net Proceeds | Planned Use (HKD thousands) | Actual Use (HKD thousands) | Unutilized Net Proceeds (HKD thousands) | Expected Timeline for Full Utilization of Unutilized Amount | | :--- | :--- | :--- | :--- | :--- | | For establishing clinics in major cities in China | 264,266 | 198,265 | 66,001 | Before December 31, 2026 | | For potential acquisitions of clinic groups in Europe | 218,019 | 213,231 | 4,788 | Before December 31, 2026 | | For increasing marketing efforts | 112,313 | 15,116 | 97,197 | Before December 31, 2026 | | Working capital and general corporate purposes | 66,066 | 1,503 | 64,563 | Before December 31, 2026 | | **Total** | **660,664** | **428,115** | **232,549** | | Other Information [Results and Appropriations](index=54&type=section&id=Results%20and%20Appropriations) This section discloses the Group's results for the six months ended June 30, 2025, and confirms no significant changes in business or financial position since the 2024 annual report - There have been no significant changes in the development or future development of the Group's business and financial position since the publication of the Company's annual report for the year ended December 31, 2024[153](index=153&type=chunk) [Interim Dividend](index=54&type=section&id=Interim%20Dividend) This section announces the Board's resolution to declare an interim dividend of HKD 0.0315 per ordinary share, totaling approximately HKD 10.1 million - The Board has resolved to declare an interim dividend of **HKD 0.0315** per ordinary share for the six months ended June 30, 2025, totaling approximately **HKD 10,102,239**[154](index=154&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares, and Debentures of the Company and its Associated Corporations](index=54&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%2C%20and%20Debentures%20of%20the%20Company%20and%20its%20Associated%20Corporations) This section details the shareholdings and interests of directors and the chief executive in the Company and its associated corporations Directors' and Chief Executive's Interests | Name of Director/Chief Executive | Capacity | Number of Shares Interested | Approximate Percentage of Total Issued Share Capital of the Company | | :--- | :--- | :--- | :--- | | Dr. Jørn Slot Jørgensen | Interest of controlled corporation; beneficial owner and spouse's interest | 184,901,100 (L) | 57.65% | | Dr. Markus Braun | Beneficial owner | 283,000 (L) | 0.09% | | Mr. Jannik Jonas Slot Jørgensen | Beneficial owner | 6,529,500 (L) | 2.04% | | Professor Dan Zoltan Reinstein | Beneficial owner and spouse's interest | 2,424,000 (L) | 0.76% | | Mr. Marcus Huascar Bracklo | Beneficial owner | 928,000 (L) | 0.29% | [Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares of the Company](index=55&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares%20of%20the%20Company) This section lists the interests and short positions of substantial shareholders in the Company's shares and underlying shares Substantial Shareholders' Interests | Name of Substantial Shareholder | Capacity | Number of Shares Interested | Approximate Percentage of Total Issued Share Capital of the Company | | :--- | :--- | :--- | :--- | | Dr. Susanne Jørgensen | Beneficial owner and spouse's interest | 184,901,100 (L) | 57.65% | - **Dr. Susanne Jørgensen** is the spouse of **Dr. Jørn Slot Jørgensen** and is therefore deemed to be interested in the Company's shares held by **Dr. Jørn Slot Jørgensen**[159](index=159&type=chunk) [Directors' Securities Transactions](index=56&type=section&id=Directors'%20Securities%20Transactions) This section confirms that all directors fully complied with the Model Code for securities transactions during the reporting period - The Company has adopted the **Model Code** as the code of conduct for securities transactions by directors and relevant employees of the Company[162](index=162&type=chunk) - All directors have confirmed their full compliance with the required standards set out in the **Model Code** and their code of conduct regarding directors' securities transactions for the six months ended June 30, 2025[162](index=162&type=chunk) [Share Option Scheme](index=56&type=section&id=Share%20Option%20Scheme) This section describes the 2019 share option scheme for employee incentives and talent retention, noting no options have been granted to date - The Company adopted a ten-year share option scheme on September 23, 2019, to reward, incentivize, recruit, and retain capable employees[163](index=163&type=chunk) - No share options have been granted under the scheme from the adoption date up to the date of this interim report[164](index=164&type=chunk) [Restricted Share Award Scheme](index=56&type=section&id=Restricted%20Share%20Award%20Scheme) This section explains the 2020 restricted share award scheme for employee attraction and retention, with no new awards granted this period and 40,000 shares unexercised - The Company adopted a restricted share award scheme on March 19, 2020, as an incentive to attract, encourage, and retain directors and employees of the Group[165](index=165&type=chunk) - No share awards were granted under the restricted share award scheme for the six months ended June 30, 2025[165](index=165&type=chunk)[167](index=167&type=chunk) - As of June 30, 2025, **40,000** restricted shares remained unexercised[167](index=167&type=chunk) [Compliance with Corporate Governance Code](index=57&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) This section states the Company's compliance with the Corporate Governance Code, acknowledging the combined roles of Chairman and CEO for leadership consistency - The Company has complied with the code provisions under **Part 2 of the Corporate Governance Code**, except for the roles of Chairman and Chief Executive Officer being combined in **Dr. Jørn Slot Jørgensen**[171](index=171&type=chunk) - The Board believes that **Dr. Jørgensen's** dual role as Chairman and Chief Executive Officer ensures consistent leadership for the Group after listing, enhancing overall strategic development effectiveness and efficiency[171](index=171&type=chunk) [Public Float](index=58&type=section&id=Public%20Float) This section confirms the Company has maintained the required public float under the Listing Rules - The Company has maintained the public float required under the Listing Rules[173](index=173&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=58&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) This section reports the repurchase and cancellation of 5,211,000 shares for HKD 18.3 million, reflecting confidence in the Company - For the six months ended June 30, 2025, the Company repurchased a total of **5,211,000** shares on the Stock Exchange under the 2024 general mandate, for a total consideration of **HKD 18,331,120**[174](index=174&type=chunk)[177](index=177&type=chunk) - The repurchased **5,211,000** shares were cancelled on February 28, 2025[177](index=177&type=chunk) - The Directors believe that the share repurchases reflect the Company's affirmation of its own value and confidence in the long-term prospects of the industry[175](index=175&type=chunk) [Issue of Equity Securities or Sale of Treasury Shares](index=59&type=section&id=Issue%20of%20Equity%20Securities%20or%20Sale%20of%20Treasury%20Shares) This section states that no equity securities were issued or treasury shares sold for cash during the reporting period - For the six months ended June 30, 2025, the Company did not issue any equity securities (including securities convertible into equity securities) for cash or sell any treasury shares for cash[179](index=179&type=chunk) [Material Events After the Reporting Period](index=59&type=section&id=Material%20Events%20After%20the%20Reporting%20Period) This section details post-reporting period changes in board members and authorized representatives, including a CFO resignation and new appointment - **Dr. Markus Braun** has tendered his resignation as Executive Director and Chief Financial Officer of the Company and ceased to be an authorized representative under the Listing Rules and the Companies Ordinance[181](index=181&type=chunk) - **Mr. Marcus Huascar Bracklo** has been re-designated from Non-executive Director to Executive Director and appointed as Chief Financial Officer and authorized representative[181](index=181&type=chunk) - **Mr. Marcus Huascar Bracklo** will cease to be a member of the Board's Audit Committee, and **Ms. Katherine Rong Xin** will be appointed as a member of the Audit Committee[181](index=181&type=chunk) [Employees](index=59&type=section&id=Employees) This section provides employee statistics, including 354 full-time staff and external medical professionals, and confirms no serious employment law violations - As of June 30, 2025, the Group had **354** full-time employees and engaged certain external surgeons, traditional ophthalmologists, and one senior management member[180](index=180&type=chunk) - The Group was not aware of any serious violations of employment-related laws and regulations for the six months ended June 30, 2025[180](index=180&type=chunk) [Audit Committee](index=59&type=section&id=Audit%20Committee) This section confirms the Audit Committee's review of the unaudited interim results and agreement with the accounting treatments adopted - The Board's Audit Committee has reviewed the Group's unaudited condensed consolidated results for the six months ended June 30, 2025, and had no disagreement with the accounting treatments adopted in preparing this report[181](index=181&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 產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Beijing Airdoc Technology Co., Ltd. 北京鷹瞳科技發展股份有限公司 （於中華人民共和國註冊成立的股份有限公司） （股份代號：2251） 中期業績公告 截至2025年6月30日止六個月 本公司董事會欣然宣佈本集團截至2025年6月30日止六個月的未經審核簡明綜合中期業 績，連同2024年同期的比較數字如下。該等中期業績已經審核委員會及本公司核數師安 永會計師事務所審閱。 於本公告內，「我們」指本公司，及如文義另有所指，指本集團。本公告所載若干金額及 百分比數字已約整，或已四捨五入至小數點後一位或兩位。任何表格、圖表或其他部分 所示總額與所列數額總和的任何差異乃因約整所致。 – 1 – | 財務概要 | | --- | | | 截至6月30日止六個月 | | | --- | --- | --- | | | 2025年 | 2024年 | | | （未經審核） | （未經審核） ...

[Performance Highlights](index=1&type=section&id=Performance%20Highlights) Total operating revenue and net profit grew double-digit, EPS increased, but no interim dividend is recommended Performance Metrics | Metric | H1 2025 (RMB) | Year-on-year Growth (%) | | :--- | :--- | :--- | | Total Operating Revenue | 38.151 billion yuan | 14.03 | | Net Profit Attributable to Parent Company Shareholders | 1.910 billion yuan | 12.91 | | Earnings Per Share | 0.60 yuan | 11.11 | | New Orders | 65.485 billion yuan | - | - The Board does not recommend an interim dividend[3](index=3&type=chunk) [Financial Data](index=2&type=section&id=Financial%20Data) [Consolidated Balance Sheet](index=2&type=section&id=Consolidated%20Balance%20Sheet) Total assets and liabilities increased as of June 30, 2025, primarily due to current assets and liabilities, reflecting business expansion Consolidated Balance Sheet Summary | Metric | June 30, 2025 (RMB) | December 31, 2024 (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 156,365,516,952.35 | 142,009,284,851.87 | 10.11 | | Total Current Assets | 109,233,007,187.22 | 93,779,782,264.73 | 16.48 | | Total Non-current Assets | 47,132,509,765.13 | 48,229,502,587.14 | -2.27 | | Total Liabilities | 110,961,852,559.50 | 98,867,036,719.24 | 12.23 | | Total Current Liabilities | 99,545,692,215.46 | 88,912,969,103.87 | 11.96 | | Total Non-current Liabilities | 11,416,160,344.04 | 9,954,067,615.37 | 14.64 | | Total Owners' Equity | 45,403,664,392.85 | 43,142,248,132.63 | 5.24 | [Consolidated Income Statement](index=7&type=section&id=Consolidated%20Income%20Statement) H1 2025 saw significant growth in total operating revenue, net profit, operating profit, and total profit, reflecting strong operating results Consolidated Income Statement Summary | Metric | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | Year-on-year Growth (%) | | :--- | :--- | :--- | :--- | | Total Operating Revenue | 38,150,951,534.17 | 33,457,011,207.05 | 14.03 | | Total Operating Costs | 35,297,964,520.14 | 31,496,571,965.14 | 12.07 | | Operating Profit | 2,506,386,064.16 | 2,110,327,011.43 | 18.77 | | Total Profit | 2,493,970,886.62 | 2,106,680,483.47 | 18.38 | | Net Profit | 2,060,843,811.02 | 1,808,543,831.83 | 13.95 | | Net Profit Attributable to Owners of the Parent Company | 1,909,795,846.06 | 1,691,463,127.79 | 12.91 | | Basic Earnings Per Share | 0.60 | 0.54 | 11.11 | [Notes to Financial Statements](index=11&type=section&id=Notes%20to%20Financial%20Statements) Financial notes provide context on statement preparation, accounts receivable/payable aging, retained earnings, revenue/cost composition, income tax, and EPS calculation [1. Basis of Preparation of Financial Statements](index=11&type=section&id=1.%20Basis%20of%20Preparation%20of%20Financial%20Statements) Financial statements are prepared on a going concern basis, adhering to Chinese accounting standards and HKEX rules, and reviewed by the Audit and Risk Committee - Financial statements are prepared on a going concern basis, adhering to Chinese Enterprise Accounting Standards, HKEX Listing Rules, and the Hong Kong Companies Ordinance[14](index=14&type=chunk) - The unaudited interim consolidated results have been reviewed by the company's Audit and Risk Committee[3](index=3&type=chunk) [2. Accounts Receivable](index=11&type=section&id=2.%20Accounts%20Receivable) Accounts receivable increased 11.86% to 14.033 billion yuan as of June 30, 2025, with most due within one year and rising bad debt provisions Accounts Receivable Aging | Accounts Receivable Aging | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Within 1 year | 10,200,421,873.10 | 9,166,698,541.03 | | 1 to 2 years | 2,661,670,703.81 | 2,912,482,204.67 | | 2 to 3 years | 2,229,504,238.98 | 1,573,780,667.10 | | 3 to 4 years | 913,146,125.86 | 709,985,357.44 | | 4 to 5 years | 501,544,472.18 | 454,092,052.84 | | Over 5 years | 1,322,948,541.31 | 1,349,940,684.20 | | Subtotal | 17,829,235,955.24 | 16,166,979,507.28 | | Less: Provision for Bad Debts | 3,796,132,598.52 | 3,621,665,242.31 | | Total | 14,033,103,356.72 | 12,545,314,264.97 | [3. Accounts Payable](index=12&type=section&id=3.%20Accounts%20Payable) Accounts payable increased 22.78% to 30.489 billion yuan as of June 30, 2025, with over 87% due within 1 year, indicating short-term payment pressure Accounts Payable Aging | Accounts Payable Aging | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Within 1 year (inclusive) | 26,789,569,066.29 | 21,233,568,378.41 | | 1-2 years (inclusive) | 1,600,932,313.61 | 1,598,639,709.95 | | 2-3 years (inclusive) | 907,965,838.73 | 897,115,396.62 | | Over 3 years | 1,190,461,458.21 | 1,103,721,536.48 | | Total | 30,488,928,676.84 | 24,833,045,021.46 | [4. Retained Earnings](index=12&type=section&id=4.%20Retained%20Earnings) Period-end retained earnings grew to 23.234 billion yuan, driven by increased net profit attributable to parent company owners, after accounting for dividends Retained Earnings Summary | Metric | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Retained Earnings at Beginning of Year | 22,690,605,142.05 | 21,337,876,676.79 | | Add: Net Profit Attributable to Owners of the Parent Company for the Period | 1,909,795,846.06 | 2,922,100,908.48 | | Less: Dividends Payable on Ordinary Shares | 1,366,315,211.38 | 1,480,812,259.51 | | Retained Earnings at End of Period | 23,234,085,776.73 | 22,690,605,142.05 | [5. Operating Revenue and Operating Costs](index=13&type=section&id=5.%20Operating%20Revenue%20and%20Operating%20Costs) H1 2025 total operating revenue was 38.151 billion yuan, costs 31.820 billion yuan, with principal business dominating, and minor contributions from interest and fee income Operating Revenue and Costs by Item | Item | Jan-Jun 2025 Revenue (RMB) | Jan-Jun 2025 Costs/Expenses (RMB) | | :--- | :--- | :--- | | Principal Business | 37,356,037,058.24 | 31,761,317,378.63 | | Other Businesses | 267,590,248.17 | 44,563,749.34 | | Interest Income | 527,283,936.51 | 13,609,163.85 | | Fee and Commission Income | 40,291.25 | 1,007,374.98 | | Total | 38,150,951,534.17 | 31,820,497,666.80 | [6. Income Tax Expense](index=13&type=section&id=6.%20Income%20Tax%20Expense) H1 2025 income tax expense rose 45.28% to 433.13 million yuan, influenced by current and deferred tax changes, with varied subsidiary tax rates Income Tax Expense Summary | Item | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | | :--- | :--- | :--- | | Current Income Tax Expense | 558,567,226.55 | 452,874,009.90 | | Deferred Income Tax Expense | (125,440,150.95) | (154,737,358.26) | | Total | 433,127,075.60 | 298,136,651.64 | - Some of the company's overseas subsidiaries pay income tax according to local laws, some companies enjoy a **15% preferential corporate income tax rate**, and other enterprises apply a **25% corporate income tax rate**[20](index=20&type=chunk) [7. Earnings Per Share](index=14&type=section&id=7.%20Earnings%20Per%20Share) H1 2025 basic and diluted EPS increased to 0.60 yuan from 0.54 yuan, driven by growth in consolidated net profit attributable to parent company shareholders Earnings Per Share Summary | Item | Jan-Jun 2025 (RMB/share) | Jan-Jun 2024 (RMB/share) | | :--- | :--- | :--- | | Basic Earnings Per Share | 0.60 | 0.54 | | Diluted Earnings Per Share | 0.60 | 0.54 | - Earnings per share are calculated based on the consolidated net profit attributable to ordinary shareholders of the parent company divided by the weighted average number of ordinary shares outstanding[21](index=21&type=chunk)[22](index=22&type=chunk) - The repurchase and cancellation of **17,334 restricted A-shares** during the period did not affect the basic earnings per share calculation and had no dilutive effect on earnings per share[22](index=22&type=chunk) [8. Segment Reporting](index=15&type=section&id=8.%20Segment%20Reporting) The company reports five operating segments; in H1 2025, all segments contributed significantly to revenue and profit, with Clean and Efficient Energy Equipment and Renewable Energy Equipment as primary revenue sources Segment Performance | Segment | Jan-Jun 2025 Operating Revenue (RMB) | Jan-Jun 2025 Operating Profit (RMB) | | :--- | :--- | :--- | | Renewable Energy Equipment | 11,586,066,450.35 | 1,054,645,641.23 | | Clean and Efficient Energy Equipment | 21,509,586,514.79 | 2,897,714,809.58 | | Engineering and Supply Chain Business | 4,127,676,462.02 | 212,805,235.94 | | Modern Manufacturing Services | 3,994,895,452.40 | 1,498,371,868.76 | | Emerging Growth Industries | 6,263,638,892.26 | 666,916,311.86 | | Total (after offset) | 38,150,951,534.17 | 2,506,386,064.16 | - In H1 2025, the company's **total assets were 156.366 billion yuan**, and **total liabilities were 110.962 billion yuan**[24](index=24&type=chunk) [9. Dividends](index=16&type=section&id=9.%20Dividends) The company distributed a 2024 final dividend of 1.366 billion yuan on August 22, 2025, but the Board does not recommend an interim dividend for H1 2025 - The company distributed a **final dividend for 2024** on August 22, 2025, amounting to **RMB 4.03 per 10 shares (tax inclusive)**, totaling **RMB 1,366,315,211.38** in cash dividends[26](index=26&type=chunk) - The Board recommends no interim dividend for the six months ended June 30, 2025[26](index=26&type=chunk) [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) [I. Overview of Industry and Principal Business During the Reporting Period](index=17&type=section&id=I.%20Overview%20of%20Industry%20and%20Principal%20Business%20During%20the%20Reporting%20Period) The company operates in the high-end energy equipment industry, providing diverse energy, environmental, and chemical products and services globally, with its core business in advanced power equipment unchanged [Industry Overview](index=17&type=section&id=Industry%20Overview) As a leading global power generation equipment supplier and EPC contractor, the company operates in nearly 90 countries, demonstrating strong competitiveness with advanced manufacturing and leading technologies - The company operates in the **high-end energy equipment industry**, providing various energy, environmental, chemical products, system integration, and logistics services to global energy operators[27](index=27&type=chunk) - The company's principal business includes the development, design, manufacturing, and sales of advanced equipment for **wind, solar, hydro, nuclear, gas, and thermal power**, chemical vessels, energy-saving and environmental protection, power electronics and control, hydrogen energy, and energy storage, along with engineering contracting and services[27](index=27&type=chunk) - The company is one of the **world's largest power generation equipment suppliers and power plant EPC contractors**, with products and services spanning nearly **90 countries and regions**[27](index=27&type=chunk) [Macroeconomic and Industry Environment](index=18&type=section&id=Macroeconomic%20and%20Industry%20Environment) H1 2025 saw global slowdown and geopolitical conflicts, but China's economy remained stable, with domestic power capacity up 18.7% and increased power/grid investments, signaling a favorable energy equipment market - In H1 2025, global economic growth slowed, geopolitical conflicts intensified, and the international trade order suffered severe setbacks[29](index=29&type=chunk) - China's national economy advanced despite pressure, operating steadily with key indicators exceeding expectations and maintaining a stable and positive development trend[29](index=29&type=chunk) Key Macroeconomic and Industry Indicators | Metric | Jan-Jun 2025 | Year-on-year Growth (%) | | :--- | :--- | :--- | | Total Electricity Consumption | 4,841.8 billion kWh | 3.7 | | National Cumulative Installed Power Generation Capacity (as of end of June) | 3.65 billion kW | 18.7 | | Investment in Power Generation Projects | 363.5 billion yuan | 5.9 | | Investment in Power Grid Projects | 291.1 billion yuan | 14.6 | - Overall, the energy equipment industry maintains a favorable market outlook[29](index=29&type=chunk) [II. Discussion and Analysis of Operations](index=18&type=section&id=II.%20Discussion%20and%20Analysis%20of%20Operations) H1 2025 saw significant progress in industrial development, technological innovation, reform, operational management, and risk control, with new effective orders growing 16.78% year-on-year [1. Industrial Development](index=18&type=section&id=1.%20Industrial%20Development) The company maintained leading market share in hydro, nuclear, and gas power, achieved overseas breakthroughs for 50MW gas turbines, secured 20MW offshore wind orders, advanced hydrogen energy projects, and topped out the world's largest CO2 storage project, with new orders up 16.78% - Hydropower order quality significantly improved, and **nuclear and gas power market share remained industry-leading**[30](index=30&type=chunk) - **50MW heavy-duty gas turbine** achieved a breakthrough in overseas orders from "zero"[30](index=30&type=chunk) - Wind power secured **20MW-class offshore wind turbine bulk orders**, with Ruoqiang and Burqin new energy equipment manufacturing bases successively put into operation[30](index=30&type=chunk) - Hydrogen energy won the Panzhihua **30 heavy-duty truck demonstration project**, **1,000 standard cubic meter alkaline electrolyzer systems** achieved order breakthroughs, and the Tibet hydrogen production and refueling integrated demonstration project was commissioned[30](index=30&type=chunk) - The main structure of the main plant for the **world's largest CO2 energy storage project** topped out[30](index=30&type=chunk) New Effective Orders | Metric | Jan-Jun 2025 (RMB) | Year-on-year Growth (%) | | :--- | :--- | :--- | | New Effective Orders | 65.485 billion yuan | 16.78 | Composition of New Effective Orders | Composition of New Effective Orders | Proportion (%) | | :--- | :--- | | Clean and Efficient Energy Equipment | 37.59 | | Renewable Energy Equipment | 30.82 | | Engineering and International Supply Chain | 11.51 | | Modern Manufacturing Services | 8.80 | | Emerging Growth Industries | 11.27 | [2. Technological Innovation](index=19&type=section&id=2.%20Technological%20Innovation) The company achieved significant technological innovation, with breakthroughs in 500MW hydro, 15MW gas turbines, 26MW/17MW offshore wind, and key biomass/hydrogen pilot platforms, integrating tech and industrial innovation - The stator frame and rotor bracket of the **Zala 500MW impulse hydro-generator unit** passed assembly acceptance[31](index=31&type=chunk) - The **15MW heavy-duty gas turbine** operated stably at design conditions, **26MW-class semi-direct drive offshore wind turbine blades** passed static load tests, and the **17MW direct-drive floating offshore wind turbine** rolled off the production line[31](index=31&type=chunk) - Key technologies for **biomass gasification fluidised bed** were successfully developed, and the **megawatt-scale chemical looping combustion pilot platform** and **hydrogen industry technology pilot platform** were selected for the first batch of key cultivation by the Ministry of Industry and Information Technology[31](index=31&type=chunk) - Self-developed marine anti-corrosion materials were applied to **20MW offshore wind turbines**, achieving integrated development of technological and industrial innovation[31](index=31&type=chunk) [3. Deepening Reform](index=19&type=section&id=3.%20Deepening%20Reform) The company deepened its three-system reform with 13 measures, launched new pilots, promoted IP empowerment, and established employee stock ownership; corporate governance improved, with key subsidiaries recognized as central SOE reform benchmarks - Comprehensively deepened the **three-system reform**, formulating **13 specific measures** to implement reforms in cadre, personnel, and remuneration systems[31](index=31&type=chunk) - Launched the **second batch of internal reform pilots**, focusing on key and difficult tasks such as improving and perfecting industrial incubation mechanisms[31](index=31&type=chunk) - Actively promoted the reform of empowering employees with intellectual property rights from work-related technological achievements, establishing **employee stock ownership** and **pilot project management systems**[31](index=31&type=chunk) - Dongfang Electric, Dongfang Steam Turbine, Dongfang Boiler, and Dongfang Wind Power were all recognized as **benchmark enterprises** in the central SOE "Science and Technology Reform Action" and "Double Hundred Action" 2024 annual special assessment[31](index=31&type=chunk) [4. Operational Management](index=19&type=section&id=4.%20Operational%20Management) The company advanced world-class value creation, digitalized business-finance integration with 9 modules, deepened lean management, and promoted intelligent transformation, developing the 'Dongfang Zhiyuan' AI model and a digital shielded pump workshop - Diligently carried out the **world-class enterprise value creation initiative**, with Dongfang Boiler's case selected as an excellent case for state-owned enterprise value creation[31](index=31&type=chunk) - Promoted the **digital transformation of business and finance integration**, implementing **9 major modules** such as establishing bidding budget BOMs, creating procurement business-finance linkages, and optimizing manufacturing cost allocation[31](index=31&type=chunk) - Deeply promoted "intelligent transformation and digital upgrading," successfully developing the **first domestic vertical large model for the energy equipment industry, "Dongfang Zhiyuan,"** launching an intelligent technology intelligence system, and completing a digital workshop for shielded pumps[31](index=31&type=chunk) [5. Risk Control](index=20&type=section&id=5.%20Risk%20Control) The company strengthened risk control through a full-level supervision system, new compliance/trademark systems for real-time contract risk monitoring, focused on key project risk resolution, enhanced company-wide compliance, and ensured production safety, with no major incidents in H1 - Strengthened the **full-level penetration supervision system**, establishing new compliance and trademark management systems to achieve real-time monitoring and full-process control of contract risks[32](index=32&type=chunk) - Organized a focused effort to address key project risks, formulating collection targets and control plans on a "one project, one policy" basis[32](index=32&type=chunk) - Emphasized **production safety responsibilities**, promoting dynamic clearance of major accident hazards, with **no major safety or environmental incidents** occurring in H1[32](index=32&type=chunk) [III. Analysis of Core Competencies During the Reporting Period](index=20&type=section&id=III.%20Analysis%20of%20Core%20Competencies%20During%20the%20Reporting%20Period) As a leading global high-end energy equipment developer and EPC contractor, the company boasts strong technological innovation, a diversified 'six power, six industry' layout, advanced manufacturing, robust market capabilities, and deep brand heritage - The company is based on the development, design, manufacturing, sales, and service of **high-end energy equipment**, actively aligning with national strategies[33](index=33&type=chunk) - Continuously optimized the industrial structure of "**six power sources in parallel**" (wind, solar, hydro, nuclear, gas, and clean coal power) and "**six industries in synergy**" (high-end petrochemical equipment, energy saving and environmental protection, engineering and international trade, modern manufacturing services, power electronics and control, and emerging industries)[33](index=33&type=chunk) - Possesses advantages such as **outstanding technological innovation capabilities**, **diversified and comprehensive industrial layout**, **advanced manufacturing and service capabilities**, **strong market development capabilities**, and **deep cultural and brand heritage**[33](index=33&type=chunk) [IV. Key Operating Performance During the Reporting Period](index=21&type=section&id=IV.%20Key%20Operating%20Performance%20During%20the%20Reporting%20Period) Total operating revenue and net profit attributable to shareholders achieved double-digit growth; this section analyzes key financial statement changes and operating revenue by industry, product, and region [(I) Analysis of Principal Business](index=21&type=section&id=%28I%29%20Analysis%20of%20Principal%20Business) H1 2025 operating revenue rose 14.26% (clean energy driven), costs up 12.45%; financial expenses decreased (exchange gains), R&D increased, investment income grew, but impairment losses worsened; operating cash flow turned negative, financing cash flow increased significantly Analysis of Key Financial Statement Items | Item | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 37,623,627,306.41 | 32,928,476,029.89 | 14.26 | Growth in Clean and Efficient Energy Equipment segment revenue | | Operating Costs | 31,805,881,127.97 | 28,285,631,299.74 | 12.45 | Increased with sales volume | | Selling Expenses | 317,891,455.51 | 289,344,237.26 | 9.87 | Increase in employee compensation | | Administrative Expenses | 1,372,877,949.96 | 1,339,624,220.93 | 2.48 | Minor change | | Financial Expenses | (378,088.72) | 45,144,897.96 | -100.84 | Increase in exchange gains | | R&D Expenses | 1,569,565,190.21 | 1,347,828,439.49 | 16.45 | Continued increase in R&D investment | | Other Income | 249,603,044.12 | 403,016,183.28 | -38.07 | Decrease in additional VAT deduction for advanced manufacturing | | Investment Income | 141,074,666.85 | (39,626,483.54) | N/A | Increase in profits from investee companies | | Fair Value Change Gains | (75,264,776.76) | 28,344,053.76 | -365.54 | Decline in fair value of held-for-trading stocks | | Credit Impairment Losses | (209,697,186.94) | 14,429,465.02 | -1,553.33 | Increase in bad debt provisions for accounts receivable based on aging portfolio | | Asset Impairment Losses | (456,796,895.04) | (259,118,589.34) | N/A | Increase in bad debt provisions for contract assets based on aging portfolio | | Net Cash Flow from Operating Activities | (556,466,428.94) | 4,064,695,241.25 | -113.69 | Increase in operating cash outflow for purchases | | Net Cash Flow from Financing Activities | 5,221,093,225.62 | 952,099,163.96 | 448.38 | Increase in raised funds and borrowings | [2. Analysis of Operating Performance by Industry, Product or Region](index=24&type=section&id=2.%20Analysis%20of%20Operating%20Performance%20by%20Industry%2C%20Product%20or%20Region) H1 2025 saw revenue growth and improved gross margins for Renewable Energy and Clean & Efficient Energy Equipment, while Engineering & Supply Chain and Modern Manufacturing Services experienced revenue and gross margin declines Operating Revenue by Product | Product Segment | Revenue (RMB) | Year-on-year Revenue Change (%) | Gross Margin (%) | Year-on-year Gross Margin Change (percentage points) | | :--- | :--- | :--- | :--- | :--- | | Renewable Energy Equipment | 10,424,515,008.11 | 26.90 | 10.12 | Increase 4.83 | | Clean and Efficient Energy Equipment | 16,767,014,023.55 | 19.21 | 17.28 | Increase 1.83 | | Engineering and Supply Chain Business | 3,138,302,302.66 | -11.30 | 6.78 | Decrease 1.91 | | Modern Manufacturing Services | 3,426,318,160.59 | -2.69 | 43.73 | Decrease 3.82 | | Emerging Growth Industries | 4,394,802,039.26 | 6.73 | 15.18 | Increase 1.35 | - Revenue growth in **Renewable Energy Equipment** business was primarily due to increased wind turbine deliveries and wind power scale, with gross margin improvement mainly from wind turbine sales for the Mulei Dongxin Wind Resource Project and high-margin offshore wind power projects[42](index=42&type=chunk) - Revenue growth in **Clean and Efficient Energy Equipment** business was primarily due to the company seizing market opportunities, with increases in nuclear power and coal power businesses[42](index=42&type=chunk) - Revenue decline in **Engineering and Supply Chain Business** was primarily due to a reduction in the company's trading business[42](index=42&type=chunk) [2. Operating Revenue by Region](index=25&type=section&id=2.%20Operating%20Revenue%20by%20Region) H1 2025 domestic operating revenue increased 17.71%, while overseas revenue decreased 24.19%, indicating a primary focus on the domestic market Operating Revenue by Region | Region | Total Operating Revenue (RMB) | Year-on-year Change (%) | | :--- | :--- | :--- | | Domestic | 35,923,133,595.79 | 17.71 | | Overseas | 2,227,817,938.38 | -24.19 | | Total | 38,150,951,534.17 | 14.03 | [(II) Analysis of Assets and Liabilities](index=25&type=section&id=%28II%29%20Analysis%20of%20Assets%20and%20Liabilities) As of June 30, 2025, the asset-liability ratio increased to 70.96%, with controllable asset structure risk; this section details asset/liability changes, bank borrowings, cash, FX risk, and asset pledges [1. Asset and Liability Status](index=25&type=section&id=1.%20Asset%20and%20Liability%20Status) Significant changes occurred in various asset and liability items, with substantial increases in loans to banks, financing receivables, inventories, contract assets, and long-term borrowings, while certain current and non-current assets/liabilities decreased Changes in Key Asset and Liability Items | Item Name | June 30, 2025 (RMB) | Change from Year-end (%) | Explanation of Change | | :--- | :--- | :--- | :--- | | Loans to Banks | 1,460,597,736.03 | 74.60 | Increase in interbank lending by the affiliated finance company | | Financing Receivables | 2,426,759,434.04 | 25.90 | Increase in bank acceptance bills received | | Inventories | 27,286,777,778.40 | 25.83 | Increase in work-in-progress | | Contract Assets | 17,287,432,592.98 | 21.24 | Increase in unbilled completed work and quality assurance deposits | | Non-current Assets Due Within One Year | 719,624,820.93 | -69.26 | Recovery of loans due within one year by the affiliated finance company | | Other Current Assets | 2,248,590,487.71 | 70.72 | Increase in input VAT to be deducted | | Long-term Receivables | 115,852,508.51 | 429.51 | Increase in installment sales of goods | | Construction in Progress | 1,700,377,412.70 | 19.13 | Increase in projects such as innovation and overseas business centers | | Deposits Absorbed and Interbank Deposits | 4,767,478,788.41 | 110.89 | Increase in deposits absorbed by the affiliated finance company | | Taxes Payable | 542,820,096.49 | -30.64 | Decrease in corporate income tax payable compared to year-start | | Other Payables | 2,969,389,239.35 | 83.93 | Increase in dividends payable due to declared dividends | | Non-current Liabilities Due Within One Year | 257,381,612.74 | -22.34 | Decrease in lease liabilities due within one year | | Other Current Liabilities | 1,248,522,114.44 | -28.86 | Decrease in output VAT amount for contract liabilities | | Long-term Borrowings | 3,434,875,573.97 | 58.50 | Increase in project borrowings | [2. Capital and Liability Ratios](index=27&type=section&id=2.%20Capital%20and%20Liability%20Ratios) As of June 30, 2025, the asset-liability ratio increased to 70.96% (up 1.34 percentage points), with asset structure risk remaining controllable Capital and Liability Ratios Summary | Item | Period-end (%) | Year-start (%) | Year-on-year Increase (percentage points) | | :--- | :--- | :--- | :--- | | Asset-Liability Ratio | 70.96 | 69.62 | 1.34 | - The company's asset structure risk remains controllable[48](index=48&type=chunk) [3. Bank Borrowings](index=27&type=section&id=3.%20Bank%20Borrowings) As of June 30, 2025, financial institution borrowings due within one year were 102 million yuan, over one year 2.153 billion yuan, primarily RMB-denominated fixed-rate borrowings of 1.948 billion yuan, with good credit and financing capabilities - As of June 30, 2025, financial institution borrowings due within one year amounted to **RMB 102 million**, and those due in over one year were **RMB 2.153 billion**[48](index=48&type=chunk) - Borrowings are primarily denominated in RMB, with **fixed-rate financial institution borrowings totaling RMB 1.948 billion**[48](index=48&type=chunk) - The company possesses good bank credit ratings and financing capabilities[48](index=48&type=chunk) [4. Cash and Cash Equivalents](index=27&type=section&id=4.%20Cash%20and%20Cash%20Equivalents) As of June 30, 2025, RMB comprised 94.63% of cash and cash equivalents, with USD at 3.59% Cash and Cash Equivalents by Currency | Currency Type | Proportion of Cash and Cash Equivalents (%) | | :--- | :--- | | RMB | 94.63 | | USD | 3.59 | [5. Foreign Exchange Risk Management](index=27&type=section&id=5.%20Foreign%20Exchange%20Risk%20Management) Expanding international operations increase foreign exchange rate risk, which the company prudently manages using hedging tools like forward foreign exchange settlements - The expansion of international operations has made foreign exchange rate risk a significant factor affecting operating results[48](index=48&type=chunk) - The company prudently uses hedging tools such as forward foreign exchange settlements to control exchange rate fluctuation risks, with the objective of hedging[48](index=48&type=chunk) [6. Asset Pledges](index=28&type=section&id=6.%20Asset%20Pledges) As of June 30, 2025, the company had 307 million yuan in bank borrowings pledged by concession rights, 1.582 billion yuan by electricity tariff collection rights, and other pledges on assets - As of June 30, 2025, pledged bank borrowings amounted to approximately **RMB 307 million**, primarily secured by concession rights, with a net value of **RMB 452 million** for the concession rights[49](index=49&type=chunk) - Additionally, there were pledged borrowings of **RMB 1.582 billion**, secured by electricity tariff collection rights[49](index=49&type=chunk) - Some plant machinery and equipment and land use rights have been pledged to obtain borrowings, which are still in the disbursement process as of the end of this period[49](index=49&type=chunk) [(III) Potential Risks](index=28&type=section&id=%28III%29%20Potential%20Risks) The company faces price, emerging industry, and international operation risks, addressed by cost management, strategy optimization, application expansion, and enhanced international risk identification [1. Price Risk](index=28&type=section&id=1.%20Price%20Risk) Strategic emerging industry product and raw material prices face cyclical fluctuations, managed by strengthening material price analysis, procurement planning, and project target cost management - Sales prices of some products in strategic emerging industries are subject to periodic fluctuations with market conditions, and cyclical fluctuations in raw material prices also bring uncertainty[50](index=50&type=chunk) - Control measures include guiding enterprises to conduct major material price analysis and trend forecasting, preparing procurement planning and inventory plans, strengthening procurement cost control, and enhancing project target cost management to improve project marginal contribution[50](index=50&type=chunk) [2. Emerging Industry Transformation and Development Risk](index=28&type=section&id=2.%20Emerging%20Industry%20Transformation%20and%20Development%20Risk) Investing in strategic emerging industries carries risks of uncertain tech routes, long incubation, and low initial returns; the company responds by boosting R&D, expanding applications, enhancing supply chain resilience, cutting costs, and optimizing strategies - Emerging industries face uncertainties in technological routes and market applications, have relatively long industrial incubation periods, and relatively low initial returns[50](index=50&type=chunk) - Control measures include continuously strengthening investment in technological innovation, actively engaging with the government to expand application scenarios, enhancing industrial chain and supply chain resilience, vigorously expanding the domestic market, reducing production and operating costs, and improving competitiveness[51](index=51&type=chunk) - Further deepening research on the development trends, technological paths, and business models of strategic emerging industries, benchmarking against leading industry enterprises, and dynamically optimizing and adjusting development strategies to drive rapid acquisition of bulk orders and promote large-scale industrial development through new industries, new models, and new drivers[51](index=51&type=chunk) [3. International Operations Risk](index=29&type=section&id=3.%20International%20Operations%20Risk) International operations face significant uncertainties from geopolitical risks, major power competition, and supply chain restructuring; the company will strengthen international analysis, accelerate clean energy innovation, expand markets, and enhance compliance with multilateral rules - International geopolitical risks are prominent, major power competition is complex, global industrial chains are accelerating restructuring, and world economic growth is weak, bringing significant uncertainties to the company's international market expansion and overseas project execution[51](index=51&type=chunk) - Control measures include strengthening attention, analysis, and judgment of international situations, accelerating technological innovation in clean energy such as wind, solar, and storage, actively expanding international markets, improving overseas marketing and planning, and continuously enhancing international brand influence[52](index=52&type=chunk) - Strengthening research and response to multilateral institutional rules such as the World Bank, focusing on risk identification, prevention, and response in sensitive countries and regions, and deepening two-way compliance to improve precise compliance capabilities[52](index=52&type=chunk) [Events After Reporting Period](index=30&type=section&id=Events%20After%20Reporting%20Period) No events significantly impacting the company and its subsidiaries have occurred since the end of this reporting period - No events that would significantly impact the company and its subsidiaries have occurred since the end of this reporting period[53](index=53&type=chunk) [(V) Outlook for H2 2025](index=30&type=section&id=%28V%29%20Outlook%20for%20H2%202025) In H2 2025, the company will leverage its SOE mission to cultivate sustainable development, pursue high-quality growth, emphasize stable operations, optimize investment, and promote coordinated development, aiming for a successful '14th Five-Year Plan' conclusion and a strong '15th Five-Year Plan' foundation - In H2 2025, the company will seize the new mission and positioning of state-owned enterprises, fully leverage development opportunities, and actively cultivate sustainable development capabilities[54](index=54&type=chunk) - The fundamental pursuit is high-quality development, emphasizing stable operations, optimizing investment structure, and promoting coordinated development[54](index=54&type=chunk) - Strive for a successful conclusion to the "**14th Five-Year Plan**" and lay a solid foundation for the "**15th Five-Year Plan**" development[54](index=54&type=chunk) [V. Other Matters](index=30&type=section&id=V.%20Other%20Matters) [1. Capital Structure](index=30&type=section&id=1.%20Capital%20Structure) As of June 30, 2025, total share capital was 3.390 billion yuan (3.050 billion A-shares, 340 million H-shares); 273 million A-shares were issued, raising 4.117 billion yuan for acquisitions, construction, and working capital Share Capital Structure | Share Class | Number of Shares as of June 30, 2025 | Proportion of Total Issued Share Capital (%) | | :--- | :--- | :--- | | A-shares | 3,050,360,326 | 89.97 | | H-shares | 340,000,000 | 10.03 | | Total | 3,390,360,326 | 100 | - On April 14, 2025, the company issued **272,878,203 A-shares** to specific investors at an issue price of **RMB 15.11 per share**[56](index=56&type=chunk) - The net proceeds from this A-share issuance amounted to **RMB 4,116,565,363.01**, which will be used for equity acquisitions, construction projects, and supplementing working capital[56](index=56&type=chunk) [2. Purchase, Sale or Repurchase of the Company's Listed Securities](index=31&type=section&id=2.%20Purchase%2C%20Sale%20or%20Repurchase%20of%20the%20Company%27s%20Listed%20Securities) The company repurchased and cancelled 17,334 restricted A-shares; no other purchases, sales, or redemptions of listed securities were made by the company or its subsidiaries - During the reporting period, the company repurchased and cancelled a total of **17,334 restricted A-shares** granted to one incentive recipient that had not yet been unblocked[58](index=58&type=chunk) - Other than the aforementioned matter, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities[58](index=58&type=chunk) [3. Significant Acquisitions and Disposals of Subsidiaries and Associates](index=32&type=section&id=3.%20Significant%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%20and%20Associates) For the six months ended June 30, 2025, there were no significant acquisitions or disposals of subsidiaries and associates - For the six months ended June 30, 2025, there were no significant acquisitions or disposals of subsidiaries and associates[59](index=59&type=chunk) [4. External Guarantees and Performance](index=32&type=section&id=4.%20External%20Guarantees%20and%20Performance) As of June 30, 2025, total guarantees were 92.5 million yuan (0.20% of net assets), including equity pledges for three wind power companies and a payment/performance guarantee for an associate - As of June 30, 2025, the company's total guarantees amounted to **RMB 92.5 million**, representing **0.20% of the company's net assets**[61](index=61&type=chunk) - The company provided guarantees totaling **RMB 68 million** to three wind power companies in Inner Mongolia, secured by **20% equity stakes** in each[60](index=60&type=chunk) - Controlling subsidiary Dongfang Electric Corporation Dongfang Steam Turbine Co., Ltd. provided a guarantee of **RMB 24.5 million** to its associate, Mitsubishi Heavy Industries Dongfang Gas Turbine (Guangzhou) Co., Ltd[60](index=60&type=chunk) [5. Significant Litigation and Arbitration Matters](index=32&type=section&id=5.%20Significant%20Litigation%20and%20Arbitration%20Matters) For the six months ended June 30, 2025, and up to this announcement date, the company was not involved in any significant litigation or arbitration, with no known outstanding or threatened claims - For the six months ended June 30, 2025, and up to the date of this announcement, the company was not involved in any significant litigation or arbitration[62](index=62&type=chunk) - To the best of the directors' knowledge, there were no outstanding or threatened significant litigations or claims against the company[62](index=62&type=chunk) [6. Employees and Remuneration Policy](index=33&type=section&id=6.%20Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the company had 18,511 employees, with 1.407 billion yuan in remuneration paid; it continuously improves wage mechanisms, optimizes income distribution favoring core technical and frontline roles, and strengthens performance management and long-term incentives for key talents [1. Number of Employees](index=33&type=section&id=1.%20Number%20of%20Employees) As of June 30, 2025, the company had a total of 18,511 employees Number of Employees | Metric | June 30, 2025 | | :--- | :--- | | Total Number of Employees | 18,511 | [2. Employee Remuneration](index=33&type=section&id=2.%20Employee%20Remuneration) As of June 30, 2025, the company paid 1.407 billion yuan in employee remuneration during the reporting period Total Employee Remuneration | Metric | Jan-Jun 2025 (RMB) | | :--- | :--- | | Total Employee Remuneration | 1,407,480,200.00 | [3. Remuneration Policy](index=33&type=section&id=3.%20Remuneration%20Policy) The company continuously improves its wage determination mechanism, coordinating performance targets and contributions to control wage levels; income distribution favors core technical and frontline roles, strengthening performance management and long-term incentives for key talents - Improved the total wage determination mechanism, coordinating business performance assessment targets, growth rates, and profit contributions to reasonably control enterprise wage levels[63](index=63&type=chunk) - Income distribution favors **core technical positions** and **frontline arduous and hazardous roles**[63](index=63&type=chunk) - Strengthened company-wide performance management, promoted the application of performance management systems, improved various special award policies, and continuously implemented long-term incentives, particularly favoring **scientific and high-skilled talents**[63](index=63&type=chunk) [4. Training Programs](index=34&type=section&id=4.%20Training%20Programs) The company develops annual training plans focusing on talent building, strategic emerging industry development, technological innovation, and international operations; programs prioritize innovative, application-oriented, and skilled talents, covering various areas, in collaboration with universities, and continuously enhance online training platforms - Developed annual unified training plans focusing on talent team building, strategic emerging industry development, technological innovation, and international operational capability enhancement[64](index=64&type=chunk) - Training programs prioritize the development of innovative, application-oriented, and skilled talents, covering cadre capabilities, group and cultural development, technological innovation, lean management, international operations, human resources, and legal risk control[64](index=64&type=chunk) - Collaborated with universities such as Tsinghua University and Sichuan University to organize key programs like training for young scientific and technological leaders and mid-to-senior level leaders[64](index=64&type=chunk) - Continuously advanced the construction of online training platforms, strengthened online training course development, enriched training formats, enhanced training base construction, and created high-quality training programs[64](index=64&type=chunk) [Corporate Governance](index=34&type=section&id=Corporate%20Governance) During the reporting period, the company fully complied with HKEX Corporate Governance Code and Standard Securities Dealing Code for Directors; the Audit and Risk Committee reviewed and approved interim results and accounting policies; information disclosure complies with regulations [7. Corporate Governance Code](index=34&type=section&id=7.%20Corporate%20Governance%20Code) The company fully complied with all applicable code provisions of the HKEX Corporate Governance Code during this period - The company fully complied with all applicable code provisions of the Corporate Governance Code as set out in Appendix C1 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited during this period[65](index=65&type=chunk) [8. Standard Securities Dealing Code for Directors](index=35&type=section&id=8.%20Standard%20Securities%20Dealing%20Code%20for%20Directors) The company adopted the Standard Securities Dealing Code for Directors as the conduct standard for directors and supervisors, who complied with it as of June 30, 2025 - The company has adopted the Standard Securities Dealing Code for Directors of Listed Issuers as the standard of conduct for directors and supervisors[66](index=66&type=chunk) - As of June 30, 2025, the company's directors and supervisors have complied with the standards set out in the Standard Code regarding securities transactions by directors and supervisors[66](index=66&type=chunk) [9. Audit and Risk Committee](index=35&type=section&id=9.%20Audit%20and%20Risk%20Committee) The Audit and Risk Committee, comprising one non-executive and three independent non-executive directors, reviewed and approved H1 2025 interim results and accounting policies - The Audit and Risk Committee is composed of one non-executive director and three independent non-executive directors[67](index=67&type=chunk) - The committee reviewed and approved the Group's interim results for the six months ended June 30, 2025, and agreed with the accounting policies adopted by the company[67](index=67&type=chunk) [10. Information Disclosure](index=35&type=section&id=10.%20Information%20Disclosure) This announcement is published on the HKEX and company websites; the half-yearly report will be published and mailed to shareholders; prepared in Chinese and English, Chinese version prevails in case of discrepancy - This announcement has been published on the HKEX website and the company's website[68](index=68&type=chunk) - The half-yearly report containing all information required by the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited will be published on the aforementioned websites and mailed to the company's shareholders in due course[68](index=68&type=chunk) - This announcement is prepared in both Chinese and English, with the Chinese version prevailing in case of any discrepancy in interpretation[69](index=69&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份內容而產生或 因倚賴該等內容而引致的任何損失承擔任何責任。 Shanghai MicroPort MedBot (Group) Co., Ltd. 上海微創醫療機器人（ 集 團 ）股份有限公司 （於中華人民共和國註冊成立的股份有限公司） （股份代號：2252） 截至2025年6月30日止六個月之中期業績公告 董事會欣然公佈本集團截至2025年6月30日止六個月之未經審核綜合中期業績， 連同截至2024年6月30日止六個月之比較數字，已經審計委員會審閱。 於本公告內，「我們」及「我們的」指本公司及（倘文意另有所指）本集團。本公 告所載若干金額及百分比數據已因約整進行調整，或已約整至一個或兩個小 數位。任何表格、圖表或其他地方中總額與當中所列金額總和之間的任何差異 乃因約整所致。 | 財務摘要 | | | | | --- | --- | --- | --- | | | 截至6月30日止六個月 | | | | | 2025年 | 2024年 | 變動 | | | 人民 ...

[Interim Results Announcement](index=1&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%85%AC%E5%91%8A) [Unaudited Interim Results](index=1&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) Paktak International Holdings Limited announced its unaudited consolidated interim results for the six months ended June 30, 2025, with comparative figures for the same period in 2024 - This announcement presents the unaudited consolidated interim results of Paktak International Holdings Limited and its subsidiaries for the six months ended June 30, 2025[2](index=2&type=chunk) [Condensed Consolidated Financial Statements](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's revenue grew by 17.4% to HK$444,541 thousand, but operating and period losses significantly widened due to fair value losses on investment properties, impairment provisions, and increased finance costs Key Figures from Condensed Consolidated Statement of Profit or Loss (For the six months ended June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Revenue | 444,541 | 378,542 | 65,999 | +17.4% | | Other income | 1,215 | 315 | 900 | +285.7% | | Other net loss | (619) | (5,130) | 4,511 | -87.9% | | Fair value loss on investment properties | (30,612) | (11,364) | (19,248) | +169.4% | | Impairment loss (provision) / reversal under expected credit loss model | (4,773) | 3,163 | (7,936) | -250.9% | | Direct costs and operating expenses | (421,628) | (361,464) | (60,164) | +16.6% | | Administrative expenses | (70,979) | (23,980) | (46,999) | +196.0% | | Operating loss | (82,855) | (19,918) | (62,937) | +316.0% | | Finance costs | (33,046) | (16,758) | (16,288) | +97.2% | | Loss before tax | (115,901) | (36,676) | (79,225) | +216.0% | | Income tax credit / (expense) | 392 | (132) | 524 | -397.0% | | Loss for the period | (115,509) | (36,808) | (78,701) | +213.8% | | Basic and diluted loss per share (HK cents) | (2.02) | (0.79) | (1.23) | +155.7% | [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The Group's total comprehensive loss for the six months ended June 30, 2025, significantly widened to HK$88,441 thousand, primarily due to increased loss for the period, despite a positive impact from exchange differences on translating foreign operations Key Figures from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Loss for the period | (115,509) | (36,808) | (78,701) | +213.8% | | Exchange differences arising from translation of financial statements of foreign operations | 29,381 | (10,911) | 40,292 | -369.3% | | Fair value loss / (gain) on financial assets at fair value through other comprehensive income | (2,313) | 71 | (2,384) | -3357.7% | | Total comprehensive loss for the period | (88,441) | (47,648) | (40,793) | +85.6% | | Total comprehensive loss attributable to equity holders of the Company | (87,371) | (47,648) | (39,723) | +83.4% | | Total comprehensive loss attributable to non-controlling interests | (1,070) | — | (1,070) | N/A | [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) As of June 30, 2025, the Group's net current liabilities significantly increased to HK$561,157 thousand, and net assets decreased by 14.7% to HK$515,762 thousand, primarily due to a substantial rise in current borrowings and reduced reserves from the loss for the period Key Figures from Condensed Consolidated Statement of Financial Position (As of June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Non-current assets | 1,204,479 | 1,183,466 | 21,013 | +1.8% | | Current assets | 620,604 | 632,011 | (11,407) | -1.8% | | Current liabilities | 1,181,761 | 848,058 | 333,703 | +39.4% | | Net current liabilities | (561,157) | (216,047) | (345,110) | +159.7% | | Total assets less current liabilities | 643,322 | 967,419 | (324,097) | -33.5% | | Non-current liabilities | 127,560 | 363,216 | (235,656) | -64.9% | | Net assets | 515,762 | 604,203 | (88,441) | -14.7% | | Share capital | 112,600 | 112,600 | 0 | 0.0% | | Reserves | 393,806 | 481,177 | (87,371) | -18.2% | | Total equity attributable to equity holders of the Company | 506,406 | 593,777 | (87,371) | -14.7% | | Non-controlling interests | 9,356 | 10,426 | (1,070) | -10.3% | | Total equity | 515,762 | 604,203 | (88,441) | -14.7% | [Notes to the Interim Financial Information](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) [1. Basis of Presentation](index=6&type=section&id=1.%20%E5%91%88%E5%88%97%E5%9F%BA%E6%BA%96) This interim financial information is prepared in accordance with the HKEX Listing Rules and HKAS 34, adopting the same accounting policies as the 2024 annual consolidated financial statements, but with significant going concern uncertainties - The interim financial information is prepared in accordance with the HKEX Listing Rules and Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the HKICPA[7](index=7&type=chunk) - The interim financial information is unaudited but has been reviewed by the Company's audit committee[8](index=8&type=chunk) [Going Concern Assumption](index=6&type=section&id=%E6%8C%81%E7%BA%8C%E7%B6%93%E7%87%9F%E5%81%87%E8%A8%AD) The Group faces severe going concern uncertainties, including a net loss of HK$115,509 thousand for the period, net current liabilities exceeding current assets by HK$561,157 thousand, and approximately HK$737,390 thousand in borrowings due within one year or repayable on demand, including a lawsuit from Huaxia Bank for HK$337,954 thousand. Management has developed mitigation plans, including bank negotiations, shareholder funding, accelerated collections, seeking additional financing, and improving new business profitability - The Group recorded a net loss of approximately **HK$115,509 thousand** for the interim period, with current liabilities exceeding current assets by approximately **HK$561,157 thousand**[9](index=9&type=chunk) - Total borrowings of approximately **HK$737,390 thousand** in principal, along with compound and default interest totaling **HK$59,254 thousand**, are due within one year or repayable on demand, exceeding cash and cash equivalents of approximately **HK$20,674 thousand**[9](index=9&type=chunk) - Huaxia Bank filed a lawsuit for an outstanding amount of approximately RMB318,794 thousand (approximately **HK$337,954 thousand**), with the court ruling for immediate repayment; the Group has appealed the loan interest amount[9](index=9&type=chunk)[10](index=10&type=chunk) - To mitigate liquidity pressure, the Group has developed several plans, including negotiating with Huaxia Bank, securing funding from major shareholders, accelerating collections, pledging commercial properties for additional bank financing, improving profitability of the iron ore mining business, and consulting with independent financial advisors on fundraising activities[11](index=11&type=chunk) [2. Changes in Accounting Policies](index=8&type=section&id=2.%20%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96%E4%B9%8B%E8%AE%8A%E5%8B%95) The Group applied HKAS 21 (Revised) "Lack of Exchangeability" during this accounting period, but this change had no significant impact on the Group's results or financial position - The Group has applied Hong Kong Accounting Standard 21 (Revised), Lack of Exchangeability[14](index=14&type=chunk) - This change in accounting policy did not have a significant impact on the preparation or presentation of the results and financial position for the current or prior periods[14](index=14&type=chunk) [3. Revenue and Segment Reporting](index=8&type=section&id=3.%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E5%A0%B1%E5%91%8A) The Group re-evaluated its internal reporting structure, reclassifying the "Others" segment to "Unallocated" items, and categorizing its operations into four reportable segments: supply chain business, property investment, hotel management and catering services, and iron ore mining and beneficiation. All revenue is derived from China - The Group re-evaluated its internal reporting structure, reclassifying the "Others" segment to "Unallocated" items[15](index=15&type=chunk) - The Group's reportable segments include supply chain business, property investment, hotel management and catering services, and iron ore mining and beneficiation[17](index=17&type=chunk) - During both interim periods, all the Group's revenue was derived from operations in the People's Republic of China[18](index=18&type=chunk) [Revenue by Major Product or Service Line](index=9&type=section&id=%E6%8C%89%E4%B8%BB%E8%A6%81%E7%94%A2%E5%93%81%E6%88%96%E6%9C%8D%E5%8B%99%E7%B7%9A%E5%8A%83%E5%88%86%E6%94%B6%E7%9B%8A) For the six months ended June 30, 2025, the Group's total revenue was HK$440,060 thousand, with the supply chain business remaining the largest contributor, and the iron ore mining and beneficiation business contributing new revenue of HK$110,580 thousand Revenue by Major Product or Service Line (For the six months ended June 30) | Product or Service Line | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Sales of goods from supply chain business | 289,842 | 326,800 | (36,958) | -11.3% | | Sales of goods from iron ore mining and beneficiation | 110,580 | – | 110,580 | N/A | | Sales of catering products from hotel management and catering services | 36,189 | 42,963 | (6,774) | -15.8% | | Management fee income from hotel management services | 3,449 | 3,074 | 375 | +12.2% | | Handling fee income from supply chain financing arrangements | – | 219 | (219) | -100.0% | | **Total Revenue from Contracts with Customers** | **440,060** | **373,056** | **67,004** | **+18.0%** | | Interest income from supply chain financing arrangements | 562 | 968 | (406) | -41.9% | | Gross rental income from investment properties | 3,919 | 4,518 | (599) | -13.3% | | **Total Revenue from Other Sources** | **4,481** | **5,486** | **(1,005)** | **-18.3%** | | **Total Revenue** | **444,541** | **378,542** | **65,999** | **+17.4%** | [Revenue by Timing of Revenue Recognition](index=10&type=section&id=%E6%8C%89%E7%A2%BA%E8%AA%8D%E6%94%B6%E7%9B%8A%E6%99%82%E9%96%93%E5%8A%83%E5%88%86%E6%94%B6%E7%9B%8A) For the six months ended June 30, 2025, most of the Group's revenue (HK$436,611 thousand) was recognized at a point in time, primarily from the supply chain business and the newly included iron ore mining and beneficiation business Revenue by Timing of Revenue Recognition and Segment Results (For the six months ended June 30) | Segment | 2025 Revenue (HK$'000) | 2024 Revenue (HK$'000) | 2025 Segment Results (HK$'000) | 2024 Segment Results (HK$'000) | | :--- | :--- | :--- | :--- | :--- | | Supply chain business | 290,404 | 327,987 | (13,995) | 473 | | Property investment | 1,261 | 1,336 | (21,201) | (3,191) | | Hotel management and catering services | 42,296 | 49,219 | (4,190) | (10,491) | | Iron ore mining and beneficiation | 110,580 | – | (37,660) | – | | **Total** | **444,541** | **378,542** | **(77,046)** | **(13,209)** | - In the first half of 2025, the iron ore mining and beneficiation segment contributed **HK$110,580 thousand** in revenue but recorded a loss of **HK$37,660 thousand**[20](index=20&type=chunk) - The supply chain business shifted from a profit of **HK$473 thousand** in the same period of 2024 to a loss of **HK$13,995 thousand** in the first half of 2025[20](index=20&type=chunk)[21](index=21&type=chunk) [Information on Assets and Liabilities](index=12&type=section&id=%E6%9C%89%E9%97%9C%E8%B3%87%E7%94%A2%E5%8F%8A%E8%B2%A0%E5%82%B5%E4%B9%8B%E8%B3%87%E6%96%99) As of June 30, 2025, the Group's total assets were HK$1,825,083 thousand, and total liabilities were HK$1,309,321 thousand. The iron ore mining and beneficiation segment accounted for the largest proportion of assets and liabilities, reflecting its business scale Segment Assets and Liabilities (As of June 30) | Segment | 2025 Segment Assets (HK$'000) | 2024 Segment Assets (HK$'000) | 2025 Segment Liabilities (HK$'000) | 2024 Segment Liabilities (HK$'000) | | :--- | :--- | :--- | :--- | :--- | | Supply chain business | 460,201 | 489,857 | 453,593 | 430,122 | | Property investment | 146,494 | 162,487 | 17,552 | 19,975 | | Hotel management and catering services | 168,076 | 175,523 | 50,217 | 49,154 | | Iron ore mining and beneficiation | 1,004,255 | 968,286 | 677,483 | 606,878 | | **Total Segments** | **1,779,026** | **1,796,153** | **1,198,845** | **1,106,129** | | Deferred tax assets/liabilities and corporate unallocated | 46,057 | 19,324 | 110,476 | 105,145 | | **Total** | **1,825,083** | **1,815,477** | **1,309,321** | **1,211,274** | - The iron ore mining and beneficiation segment's assets reached **HK$1,004,255 thousand** as of June 30, 2025, accounting for **56.4%** of total segment assets[22](index=22&type=chunk) [4. Other Income and Other Net Loss / (Gain)](index=13&type=section&id=4.%20%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E6%B7%A8%EF%BC%88%E虧%E6%90%8D%EF%BC%89%E2%88%95%E6%94%B6%E7%9B%8A) For the six months ended June 30, 2025, the Group's other income significantly increased to HK$1,215 thousand, primarily from early lease termination gains and reversal of payables. Other net losses substantially decreased due to reduced losses from write-offs/disposals of property, plant, and equipment Other Income and Other Net Loss / (Gain) (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Interest income | 2 | 154 | (152) | -98.7% | | Gain on early lease termination | 180 | — | 180 | N/A | | Reversal of payables | 691 | — | 691 | N/A | | Miscellaneous income | 342 | 161 | 181 | +112.4% | | **Total Other Income** | **1,215** | **315** | **900** | **+285.7%** | | Fair value loss on financial assets at fair value through profit or loss | — | (96) | 96 | -100.0% | | Loss on write-off / disposal of property, plant and equipment | (619) | (5,034) | 4,415 | -87.7% | | **Total Other Net Loss** | **(619)** | **(5,130)** | **4,511** | **-87.9%** | [5. Operating Loss](index=13&type=section&id=5.%20%E7%B6%93%E7%87%9F%E虧%E6%90%8D) For the six months ended June 30, 2025, the depreciation and amortization expenses deducted from the Group's operating loss significantly increased, with property, plant, and equipment depreciation growing by nearly 5.5 times and intangible asset amortization by almost 28 times Items Deducted from Operating Loss (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 33,931 | 5,233 | 28,698 | +548.4% | | Depreciation of right-of-use assets | 2,943 | 2,130 | 813 | +38.2% | | Amortization of intangible assets | 4,409 | 154 | 4,255 | +2762.9% | [6. Finance Costs](index=13&type=section&id=6.%20%E8%B2%A1%E5%8B%99%E6%88%90%E6%9C%AC) The Group's finance costs primarily refer to interest on bank loans, other loans, and lease liabilities - Finance costs refer to interest on bank loans, other loans, and lease liabilities[24](index=24&type=chunk) [7. Income Tax Expense](index=14&type=section&id=7.%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) For the six months ended June 30, 2025, the Group recorded an income tax credit of HK$392 thousand, compared to an expense of HK$132 thousand in the prior period, mainly due to changes in deferred tax in China. No provision for profits tax was made for Hong Kong operations due to the absence of taxable profits Income Tax Expense (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Current tax - PRC enterprise income tax | — | (2) | 2 | -100.0% | | Deferred tax - PRC | (392) | 134 | (526) | -392.5% | | **Income tax (credit) / expense** | **(392)** | **132** | **(524)** | **-397.0%** | - Hong Kong profits tax is calculated at **16.5%**, but no provision was made as the Company and its subsidiaries had no taxable profits or consistently recorded tax losses in Hong Kong[26](index=26&type=chunk) - Subsidiaries located in the PRC are subject to enterprise income tax at **25%**[27](index=27&type=chunk) [8. Loss Per Share](index=15&type=section&id=8.%20%E6%AF%8F%E8%82%A1%E虧%E6%90%8D) For the six months ended June 30, 2025, the loss attributable to equity holders of the Company was HK$113,790 thousand, resulting in a basic and diluted loss per share of 2.02 HK cents, a significant increase from the prior period Loss Per Share (For the six months ended June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Loss attributable to equity holders of the Company | (113,790) | (36,808) | (76,982) | +209.1% | | Basic and diluted loss per share (HK cents) | (2.02) | (0.79) | (1.23) | +155.7% | - Basic loss per share is the same as diluted loss per share as the Company has no potentially dilutive shares[30](index=30&type=chunk) [9. Dividends](index=15&type=section&id=9.%20%E8%82%A1%E6%81%AF) The Directors do not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Directors do not recommend the payment of any interim dividend for the six months ended June 30, 2025 (2024: nil)[31](index=31&type=chunk) [10. Property, Plant and Equipment](index=15&type=section&id=10.%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) For the six months ended June 30, 2025, the Group's cost of purchases of property, plant and equipment significantly increased to HK$28,256 thousand, and a loss on write-off/disposal of HK$619 thousand was recorded Changes in Property, Plant and Equipment (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Cost of purchases | 28,256 | 2,650 | 25,606 | +966.3% | | Net book value of write-offs / disposals | 2,756 | 5,000 | (2,244) | -44.9% | | Loss on write-off / disposal | 619 | 5,000 | (4,381) | -87.6% | [11. Right-of-Use Assets](index=15&type=section&id=11.%20%E4%BD%BF%E7%94%A8%E6%AC%8A%E8%B3%87%E7%94%A2) For the six months ended June 30, 2025, the Group added right-of-use assets of approximately HK$2,672 thousand, primarily related to Hong Kong office leases, including leased land, office, and restaurant leases Additions to Right-of-Use Assets (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Additions to right-of-use assets | 2,672 | 3,820 | (1,148) | -30.1% | - Additions to right-of-use assets primarily relate to Hong Kong office leases, which include leased land, office, and restaurant leases[33](index=33&type=chunk) [12. Investment Properties](index=16&type=section&id=12.%20%E6%8A%95%E8%B3%87%E7%89%A9%E6%A5%AD) The Group's investment properties are located in China, measured at fair value, and their valuations were updated as of June 30, 2025. Some investment properties are pledged as collateral for bank loans - All of the Group's property interests held under operating leases to earn rental income or for capital appreciation are measured at fair value and classified and accounted for as investment properties[36](index=36&type=chunk) - Investment properties are located in China and their valuations were updated by independent valuers as of June 30, 2025[37](index=37&type=chunk) - Certain investment properties are pledged as collateral for bank loans granted to the Group[37](index=37&type=chunk) [13. Intangible Assets](index=16&type=section&id=13.%20%E7%84%A1%E5%BD%A2%E8%B3%87%E7%94%A2) For the six months ended June 30, 2025, the Group made no additions to intangible assets, and amortization expenses for the period were included in administrative expenses. All mining rights are pledged to banks for loans - No additions to intangible assets were made for the six months ended June 30, 2025[38](index=38&type=chunk) - Amortization expenses for the period are included in "Administrative expenses" in the consolidated statement of profit or loss[38](index=38&type=chunk) - All mining rights are pledged to banks for loans granted to the Group[38](index=38&type=chunk) [14. Trade and Other Receivables](index=16&type=section&id=14.%20%E6%87%89%E6%94%B6%E8%B2%BF%E6%98%93%E6%AC%BE%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other receivables amounted to HK$558,798 thousand, a slight decrease from December 31, 2024. Trade receivables overdue for more than twelve months significantly increased to HK$350,398 thousand, indicating higher collection risk Trade and Other Receivables (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Trade receivables, net of provision for expected credit losses | 397,280 | 415,631 | (18,351) | -4.4% | | Other receivables, net of provision for expected credit losses | 85,983 | 97,970 | (11,987) | -12.2% | | Deposits and prepayments | 75,535 | 54,761 | 20,774 | +37.9% | | **Total** | **558,798** | **568,362** | **(9,564)** | **-1.7%** | Ageing Analysis of Trade Receivables (As of June 30) | Ageing | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Within 1 month | 4,099 | 2,429 | 1,670 | +68.7% | | 1 to 3 months | 1,633 | 3,025 | (1,392) | -46.0% | | 3 to 12 months | 41,150 | 341,717 | (300,567) | -88.0% | | Over 12 months | 350,398 | 68,460 | 281,940 | +411.9% | | **Total** | **397,280** | **415,631** | **(18,351)** | **-4.4%** | - Trade receivables overdue for more than twelve months significantly increased from **HK$68,460 thousand** as of December 31, 2024, to **HK$350,398 thousand** as of June 30, 2025[40](index=40&type=chunk) [15. Finance Lease Receivables](index=17&type=section&id=15.%20%E6%87%89%E6%94%B6%E8%9E%8D%E8%B3%87%E7%A7%9F%E8%B3%83%E6%AC%BE%E9%A0%85) As of June 30, 2025, the Group's finance lease receivables were fully impaired, with a carrying amount of zero. All balances were fully impaired due to adverse events Finance Lease Receivables (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Finance lease receivables | 29,798 | 29,871 | (73) | -0.2% | | Less: Provision for expected credit losses | (29,798) | (29,871) | 73 | -0.2% | | **Net** | **—** | **—** | **—** | **0.0%** | - All balances of finance lease receivables were fully impaired due to adverse events[42](index=42&type=chunk) [16. Impairment Assessment of Financial Assets under ECL Model](index=18&type=section&id=16.%20%E9%A0%90%E6%9C%9F%E4%BF%A1%E8%B2%B8%E虧%E6%90%8D%E6%A8%A1%E5%BC%8F%E4%B8%8B%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2%E6%B8%9B%E5%80%BC%E8%A9%95%E4%BC%B0) For the six months ended June 30, 2025, the Group recognized an impairment loss of HK$4,773 thousand, compared to a reversal of HK$3,163 thousand in the prior period, primarily due to increased impairment losses on trade receivables Impairment Loss on Financial Assets (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Trade receivables | 4,924 | (3,196) | 8,120 | -254.1% | | Other receivables | 932 | 33 | 899 | +2724.2% | | Finance lease receivables | (1,083) | — | (1,083) | N/A | | **Total** | **4,773** | **(3,163)** | **7,936** | -250.9% | [17. Trade Payables](index=19&type=section&id=17.%20%E6%87%89%E4%BB%98%E8%B2%BF%E6%98%93%E6%AC%BE%E9%A0%85) As of June 30, 2025, the Group's total trade payables increased by 23.9% to HK$240,919 thousand from December 31, 2024, primarily due to an increase in trade payables aged three to twelve months and over twelve months Ageing Analysis of Trade Payables (As of June 30) | Ageing | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Within 1 month | 45,563 | 38,023 | 7,540 | +19.8% | | 1 to 3 months | 9,408 | 31,766 | (22,358) | -70.4% | | 3 to 12 months | 95,423 | 58,514 | 36,909 | +63.1% | | Over 12 months | 90,525 | 66,147 | 24,378 | +36.9% | | **Total** | **240,919** | **194,450** | **46,469** | **+23.9%** | [18. Borrowings](index=19&type=section&id=18.%20%E5%80%9F%E8%B2%B8) As of June 30, 2025, the Group's total borrowings amounted to HK$747,034 thousand, with HK$737,390 thousand due within one year or repayable on demand, indicating significant liquidity pressure. Several bank loans are in default or repayable on demand, some secured by investment properties, mining rights, or corporate guarantees Total Borrowings and Maturity Analysis (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Bank loans, secured | 737,034 | 719,763 | 17,271 | +2.4% | | Other loans, secured | — | 23,924 | (23,924) | -100.0% | | Other loans, unsecured | 10,000 | 1,000 | 9,000 | +900.0% | | **Total Borrowings** | **747,034** | **744,687** | **2,347** | **+0.3%** | | Due within one year or repayable on demand | 737,390 | 490,321 | 247,069 | +50.4% | | Amounts due after one year | 9,644 | 254,366 | (244,722) | -96.2% | - Bank loan two (principal amount of approximately **HK$306,007 thousand**) is in default and repayable on demand; the Group is actively negotiating with the lender for renewal and extension of repayment[46](index=46&type=chunk) - Bank loan five (principal amount of approximately **HK$267,619 thousand**) is secured by the Group's mining rights, repayable in installments until 2026[48](index=48&type=chunk) - Other loan one (principal amount of approximately **HK$23,924 thousand**) was fully settled during the interim period through the disposal of collateral[51](index=51&type=chunk) [19. Significant Related Party Transactions and Balances](index=21&type=section&id=19.%20%E9%87%8D%E5%A4%A7%E9%97%9C%E8%81%AF%E4%BA%BA%E5%A3%AB%E4%BA%A4%E6%98%93%E5%8F%8A%E7%B5%90%E9%A4%98) For the six months ended June 30, 2025, the Group's key management personnel compensation was HK$2,286 thousand, a slight increase from the prior period. Other than financial arrangements disclosed in Note 18, the Group had no other significant related party transactions or balances Key Management Personnel Compensation (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Salaries, allowances and other benefits | 2,208 | 2,108 | 100 | +4.7% | | Contributions to defined contribution retirement plans | 78 | 83 | (5) | -6.0% | | **Total** | **2,286** | **2,191** | **95** | **+4.3%** | - Other than the financial arrangements entered into with certain related parties as disclosed in Note 18, the Group did not enter into any other significant related party transactions during both interim periods[52](index=52&type=chunk) - As of June 30, 2025, and December 31, 2024, the Group had no significant balances with related parties[53](index=53&type=chunk) [20. Litigation and Claims](index=22&type=section&id=20.%20%E8%A8%B4%E8%A8%9F%E5%8F%8A%E7%B4%A2%E5%84%9F) The Group's subsidiary, Shenzhen Jinsheng Supply Chain Co., Ltd., faces legal action for failing to repay bank borrowings of approximately RMB318,794 thousand (approximately HK$337,954 thousand) from Huaxia Bank, with the court ruling for immediate repayment. The Group has appealed the loan interest amount, and the related bank borrowings are classified as current liabilities - The Group's subsidiary, Shenzhen Jinsheng Supply Chain Co., Ltd., failed to repay interest-bearing bank borrowings of approximately RMB294,300 thousand (approximately **HK$322,612 thousand**) from Huaxia Bank[54](index=54&type=chunk) - Huaxia Bank filed a legal claim, and the court ruled that the Group must immediately repay principal, interest, and compound interest totaling approximately RMB318,794 thousand (approximately **HK$337,954 thousand**), and bear legal costs[54](index=54&type=chunk)[56](index=56&type=chunk) - The Group has appealed the amount of loan interest payable under the relevant loan agreement of the civil judgment, and the appeal has been accepted by the Guangdong Provincial High People's Court[54](index=54&type=chunk) - The related bank borrowings are classified as current liabilities, and the Group is still negotiating with Huaxia Bank to extend the repayment date[55](index=55&type=chunk) [Business Review](index=23&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) [Supply Chain Business](index=23&type=section&id=%E4%BE%9B%E6%87%89%E9%8F%88%E6%A5%AD%E5%8B%99) For the six months ended June 30, 2025, the Group's supply chain business faced significant challenges, with revenue slowing or decreasing. The newly acquired iron ore mining and beneficiation business recorded losses due to unreleased capacity, unfavorable iron ore price movements, and high fixed costs. The Group is strengthening credit control, releasing capacity, and seeking new clients to diversify revenue streams - The performance of the supply chain business faced significant challenges, with revenue slowing or even decreasing compared to the same period last year[58](index=58&type=chunk) - The iron ore mining and beneficiation business faced downward pressure, with losses primarily due to unreleased capacity, unfavorable iron ore price movements, and high fixed costs[58](index=58&type=chunk) - The Group is strengthening credit control, releasing capacity in its iron ore mining and beneficiation business, and seeking new potential clients to diversify revenue streams[58](index=58&type=chunk) [Hotel Management and Catering Services](index=23&type=section&id=%E9%85%92%E5%BA%97%E7%AE%A1%E7%90%86%E5%8F%8A%E9%A4%90%E9%A3%B2%E6%9C%8D%E5%8B%99) For the six months ended June 30, 2025, revenue from the hotel management and catering services segment decreased by approximately 14%, primarily due to a slowdown in consumption recovery as the market normalized and competition intensified. The segment continued to record losses, but the Group maintained stable performance by optimizing operational management and enhancing brand promotion, planning to improve product services and launch special events to attract customers - Revenue from the hotel management and catering services segment decreased by approximately **14%** compared to the same period in 2024, mainly due to continued market normalization and intensified competition[59](index=59&type=chunk) - The segment continued to record losses, primarily impacted by fair value losses on investment properties[59](index=59&type=chunk) - The Group has implemented cautious and flexible strategies aimed at enhancing cost-effectiveness and optimizing operational management, with plans to improve product and service quality, launch new menus, and organize special events[60](index=60&type=chunk) [Property Investment](index=24&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) For the six months ended June 30, 2025, the Group's investment properties in Yunfu, China, generated rental income, but continued to face revaluation losses due to a weak real estate market. The Group will continue to lease out properties and consider timely spin-off sales to improve working capital - The Group's investment properties located in Yunfu, China, generated rental income[61](index=61&type=chunk) - Due to the overall weak performance of the real estate market, the Group continues to face challenges from revaluation losses on investment properties[61](index=61&type=chunk) - The Group will continue to lease out these investment properties to generate rental income and will consider spin-off sales at appropriate times to improve working capital[61](index=61&type=chunk) [Financial Review](index=24&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) [Revenue](index=24&type=section&id=%E6%94%B6%E7%9B%8A) For the six months ended June 30, 2025, the Group's total revenue increased by 17.4% year-on-year to HK$444,500 thousand, primarily driven by HK$110,600 thousand from the new mining business, partially offsetting reduced revenue from supply chain and hotel management and catering services Revenue Overview (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 444,500 | 378,500 | 66,000 | +17.4% | | Mining business revenue | 110,600 | – | 110,600 | N/A | | Supply chain business revenue | 290,400 | 328,000 | (37,600) | -11.5% | | Hotel management and catering services revenue | 42,300 | 49,200 | (6,900) | -14.0% | | Total property investment revenue | 1,300 | 1,300 | 0 | 0.0% | [Expenses](index=25&type=section&id=%E9%96%8B%E6%94%AF) For the six months ended June 30, 2025, the Group's direct costs and operating expenses, administrative expenses, and finance costs all significantly increased, primarily due to the operations of the new iron ore mining and beneficiation business. Impairment losses under the expected credit loss model also shifted from reversal to provision, reflecting delayed payments from supply chain business customers Expenses Overview (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Direct costs and operating expenses | 421,600 | 361,500 | 60,100 | +16.6% | | Administrative expenses | 71,000 | 24,000 | 47,000 | +195.8% | | Impairment loss (provision) / reversal under expected credit loss model | 4,700 | (3,200) | 7,900 | -246.9% | | Finance costs | 33,000 | 16,800 | 16,200 | +96.4% | - The increase in direct costs and operating expenses, as well as administrative expenses, was primarily due to the new iron ore mining and beneficiation business[65](index=65&type=chunk) - The increase in impairment losses under the expected credit loss model was mainly due to delayed payments of outstanding invoice amounts by certain customers in the supply chain business[65](index=65&type=chunk) [Loss for the Period](index=25&type=section&id=%E6%9C%9F%E5%85%A7%E虧%E6%90%8D) For the six months ended June 30, 2025, the Group's net loss expanded to HK$115,500 thousand, primarily due to a substantial increase in overall costs from the mining business acquisition and increased fair value losses on investment properties Loss for the Period (For the six months ended June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Net loss | 115,500 | 36,800 | 78,700 | +213.9% | - The increased loss was primarily due to the completion of the mining business acquisition, leading to a substantial increase in overall costs (including direct costs, operating and administrative expenses, and finance costs), and increased fair value losses on investment properties[66](index=66&type=chunk) [Investment Properties](index=25&type=section&id=%E6%8A%95%E8%B3%87%E7%89%A9%E6%A5%AD) The Group's investment properties include leased retail shops in Yunfu, China, and leased commercial buildings in Beihai, Guangxi Province. Due to challenging business conditions in China, the Group recognized a fair value loss on investment properties of HK$30,600 thousand, a significant increase from the prior period Fair Value Loss on Investment Properties (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Fair value loss on investment properties | 30,600 | 11,400 | 19,200 | +168.4% | - Investment properties include leased retail shops in Yunfu, China, valued at **HK$141,400 thousand**, and leased commercial buildings in Beihai, Guangxi Province, China, valued at **HK$92,100 thousand**[67](index=67&type=chunk) [Intangible Assets](index=26&type=section&id=%E7%84%A1%E5%BD%A2%E8%B3%87%E7%94%A2) As of June 30, 2025, the Group's intangible assets increased to HK$209,000 thousand, primarily comprising mining rights of HK$208,600 thousand, valid until 2049 Intangible Assets (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total intangible assets | 209,000 | 206,400 | 2,600 | +1.3% | | Mining rights | 208,600 | 205,800 | 2,800 | +1.4% | - Mining rights represent underground mining permits, valid from **2024 to 2049**[68](index=68&type=chunk) [Financial Assets at Fair Value Through Other Comprehensive Income](index=26&type=section&id=%E6%8C%89%E5%85%AC%E5%B9%B3%E5%83%B9%E5%80%BC%E8%A8%88%E5%85%A5%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E7%9A%84%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) As of June 30, 2025, the Group's financial assets at fair value through other comprehensive income significantly increased to approximately HK$30,300 thousand, primarily due to investments in unlisted equity securities during the period Financial Assets at Fair Value Through Other Comprehensive Income (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Financial assets | 30,300 | 200 | 30,100 | +15050.0% | - This change was primarily due to investments in unlisted equity securities during the period, which are held for long-term investment purposes[69](index=69&type=chunk) [Trade and Other Receivables](index=26&type=section&id=%E6%87%89%E6%94%B6%E8%B2%BF%E6%98%93%E6%AC%BE%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other receivables amounted to HK$558,800 thousand, primarily from the supply chain business. Trade receivables overdue within 12 months significantly increased, and management is actively monitoring to mitigate credit risk Trade and Other Receivables (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total trade and other receivables | 558,800 | 568,400 | (9,600) | -1.7% | | Trade receivables overdue within 12 months | 300,200 | 175,600 | 124,600 | +71.0% | | Trade receivables overdue over 12 months | 57,400 | 66,100 | (8,700) | -13.2% | - Trade and other receivables primarily arise from the supply chain business and supply chain financing arrangements[70](index=70&type=chunk) - Management is committed to strict control over outstanding receivables, regularly reviewing overdue balances and assessing recoverability on a case-by-case basis[70](index=70&type=chunk) [Restricted Cash](index=26&type=section&id=%E5%8F%97%E9%99%90%E5%88%B6%E7%8F%BE%E9%87%91) As of June 30, 2025, the Group held restricted cash of HK$7,200 thousand, primarily related to reclamation obligation deposits for its mining operations in China Restricted Cash (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Restricted cash | 7,200 | 7,000 | 200 | +2.9% | - Restricted cash primarily relates to reclamation obligation deposits for the mining business in China[71](index=71&type=chunk) [Trade Payables](index=26&type=section&id=%E6%87%89%E4%BB%98%E8%B2%BF%E6%98%93%E6%AC%BE%E9%A0%85) As of June 30, 2025, the Group's trade payables significantly increased by HK$46,400 thousand to HK$240,900 thousand, primarily due to increased mining business activities Trade Payables (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Trade payables | 240,900 | 194,500 | 46,400 | +23.9% | - The increase in trade payables was due to increased mining business activities for the six months ended June 30, 2025[72](index=72&type=chunk) [Liquidity and Financial Resources](index=27&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) As of June 30, 2025, the Group's cash and cash equivalents were HK$20,700 thousand, while interest-bearing borrowings amounted to HK$760,700 thousand. The gearing ratio rose to 150.2%, and the current ratio decreased to 0.53, reflecting a significant increase in liquidity pressure, mainly due to a substantial rise in borrowings due within one year Liquidity and Financial Resources Overview (As of June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 20,700 | 21,700 | (1,000) | -4.6% | | Interest-bearing borrowings (including borrowings and lease liabilities) | 760,700 | 759,400 | 1,300 | +0.2% | | Gearing ratio | 150.2% | 127.9% | +22.3% | +17.4% | | Current ratio | 0.53 | 0.75 | (0.22) | -29.3% | | Borrowings due within one year or repayable on demand | 737,400 | 490,300 | 247,100 | +50.4% | - The increase in the gearing ratio was primarily due to a significant loss recorded during the period, leading to a reduction in the amount of equity attributable to equity holders of the Company[73](index=73&type=chunk) - The decrease in the current ratio was mainly due to a substantial increase in borrowings due within one year or repayable on demand[73](index=73&type=chunk) [Foreign Exchange and Interest Rate Risk Management](index=28&type=section&id=%E5%A4%96%E5%8C%AF%E5%8F%8A%E5%88%A9%E7%8E%87%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86) The Group adopts strict policies to manage foreign exchange and interest rate risks, with primary foreign currency exchange risk arising from HKD and RMB exchange rate fluctuations. Borrowings are issued at floating and fixed rates, creating cash flow and fair value interest rate risks, which management will closely monitor and consider hedging - The Group adopts strict and prudent policies to manage foreign exchange risk and interest rate risk[74](index=74&type=chunk) - The primary foreign currency exchange risk arises from fluctuations in the exchange rates between Hong Kong Dollars (pegged to the US Dollar) and Renminbi[74](index=74&type=chunk) - Borrowings are issued at floating and fixed interest rates, giving rise to cash flow interest rate risk and fair value interest rate risk, which management will closely monitor and consider hedging when necessary[74](index=74&type=chunk) [Pledge of Group Assets](index=28&type=section&id=%E9%9B%86%E5%9C%98%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2025, approximately HK$162,200 thousand of the Group's investment properties and approximately HK$208,600 thousand of mining rights were pledged to banks for bank loans Pledge of Group Assets (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total carrying amount of investment properties | 162,200 | 178,500 | (16,300) | -9.1% | | Carrying amount of mining rights | 208,600 | 205,800 | 2,800 | +1.4% | - The aforementioned assets are pledged to banks for loans granted to the Group[75](index=75&type=chunk) [Financial Guarantees Provided](index=28&type=section&id=%E5%B7%B2%E6%8F%90%E4%BE%9B%E4%B9%8B%E8%B2%A1%E5%8B%99%E6%93%94%E4%BF%9D) As of June 30, 2025, the Company provided corporate guarantees for financing granted to certain subsidiaries, with a guaranteed amount of HK$306,000 thousand Financial Guarantees Provided (As of June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Amount of corporate guarantees | 306,000 | 296,000 | 10,000 | +3.4% | - The Company has provided corporate guarantees for financing granted to certain subsidiaries of the Group, with the beneficiaries being certain banks[76](index=76&type=chunk) [Capital Expenditure and Commitments](index=28&type=section&id=%E8%B3%87%E6%9C%AC%E6%94%AF%E5%87%BA%E5%8F%8A%E6%89%BF%E6%93%94) For the six months ended June 30, 2025, the Group invested approximately HK$28,200 thousand in property, plant and equipment, primarily for leasehold improvements, furniture, fixtures and equipment, and motor vehicles. There were no capital commitments at the end of the reporting period Capital Expenditure (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | Change (HK$'000) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Investment in property, plant and equipment | 28,200 | 2,700 | 25,500 | +944.4% | - Investments were made in leasehold improvements, furniture, fixtures and equipment, and motor vehicles[77](index=77&type=chunk) - As of June 30, 2025, and December 31, 2024, the Group had no capital commitments[78](index=78&type=chunk) [Significant Investments Held](index=28&type=section&id=%E6%8C%81%E6%9C%89%E4%B9%8B%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87) For the six months ended June 30, 2025, the Group held no significant investments - For the six months ended June 30, 2025, the Group held no significant investments[79](index=79&type=chunk) [Significant Acquisitions and Disposals of Subsidiaries and Associates](index=29&type=section&id=%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%E5%8F%8A%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E4%BA%8B%E9%A0%85) For the six months ended June 30, 2025, the Group did not undertake any significant acquisitions or disposals of subsidiaries and associates - For the six months ended June 30, 2025, the Group did not undertake any significant acquisitions or disposals of subsidiaries and associates[80](index=80&type=chunk) [Other Information](index=29&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) [Employees and Remuneration Policy](index=29&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the Group's total number of employees was approximately 520, a significant increase from the prior period. Employee remuneration and bonuses are determined based on responsibilities, performance, experience, and industry practices, and are regularly reviewed Number of Employees (As of June 30) | Item | 2025 (Number) | 2024 (Number) | Change (Number) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total number of employees | 520 | 280 | 240 | +85.7% | - Employee remuneration and bonuses are determined based on their responsibilities, performance, experience, and prevailing industry practices, and are regularly reviewed by management[81](index=81&type=chunk) [Interim Dividend](index=29&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2025 (June 30, 2024: nil HKD)[83](index=83&type=chunk) [Events After Reporting Period](index=29&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E4%BB%B6) There were no significant events concerning the Company after the reporting period - There were no significant events concerning the Company after the reporting period[84](index=84&type=chunk) [Future Prospects](index=29&type=section&id=%E6%9C%AA%E4%BE%86%E5%89%8D%E6%99%AF) Looking ahead to the second half of 2025, the Group anticipates a complex and volatile macroeconomic environment, maintaining cautious optimism. The Group will continue to strengthen its market position in the supply chain business, fully utilize iron ore mining capacity, enhance efficiency in hotel management and catering services, and actively negotiate with Huaxia Bank to ensure financial stability - Looking ahead to the second half of 2025, the macroeconomic environment is expected to remain complex, volatile, challenging, and uncertain[85](index=85&type=chunk) - The Group will focus on fully utilizing the capacity of its iron ore mining and beneficiation business to effectively dilute high fixed costs and seek new potential clients[85](index=85&type=chunk) - The Group will continue to focus on improving operational efficiency in hotel management and catering services, enhancing customer satisfaction, and exploring innovative ways to attract a broader customer base[86](index=86&type=chunk) - The Group is actively negotiating with Huaxia Bank regarding the renewal and extension of overdue bank borrowings and loan agreements to ensure financial stability[86](index=86&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=30&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[87](index=87&type=chunk) [Compliance with Corporate Governance Code](index=30&type=section&id=%E9%81%B5%E5%AE%88%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) For the six months ended June 30, 2025, the Company complied with the Corporate Governance Code in Appendix C1 of the Listing Rules, with two deviations: the roles of Chairman and Chief Executive Officer are held by the same person, and Chairman Mr. Wu Zongchuan was unable to attend the Annual General Meeting - The Company has complied with the principles and applicable code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules[88](index=88&type=chunk) - Deviation one: The roles of Chairman and Chief Executive Officer are held concurrently by Mr. Wu Zongchuan, a structure the Board believes is conducive to maintaining strong and stable leadership[88](index=88&type=chunk) - Deviation two: Chairman Mr. Wu Zongchuan was unable to attend the Annual General Meeting on June 20, 2025, due to other business arrangements and had delegated an executive director to answer questions on his behalf[88](index=88&type=chunk) [Directors' Securities Transactions in Compliance with Model Code](index=31&type=section&id=%E8%91%A3%E4%BA%8B%E9%81%B5%E5%AE%88%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87%E9%80%B2%E8%A1%8C%E4%B9%8B%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) The Company has adopted a strict code of conduct for directors' securities transactions and confirmed that all directors complied with this model code for the six months ended June 30, 2025 - The Company has adopted a code of conduct for directors' securities transactions, with terms no less exacting than the standard set out in Appendix C3 of the Listing Rules[89](index=89&type=chunk) - Following specific enquiries with all Directors, the Company confirmed that all Directors complied with the model code for the six months ended June 30, 2025[89](index=89&type=chunk) [Audit Committee](index=31&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee has reviewed the Group's unaudited interim results for the six months ended June 30, 2025, deeming them compliant with applicable accounting standards and Listing Rules, with appropriate disclosures. The external auditor performed agreed-upon procedures but did not express an assurance opinion - The Group's external auditor performed certain agreed-upon procedures on the unaudited interim condensed consolidated financial statements in accordance with Hong Kong Standard on Related Services 4400 (Revised), "Engagements to Perform Agreed-Upon Procedures"[90](index=90&type=chunk) - The auditor did not express any assurance on the Company's interim results for the six months ended June 30, 2025[90](index=90&type=chunk) - The Audit Committee believes that the Group's unaudited financial statements for the six months ended June 30, 2025, comply with applicable accounting standards and Listing Rules, and appropriate disclosures have been made[90](index=90&type=chunk) [Publication of Interim Report on HKEX and Company Website](index=31&type=section&id=%E6%96%BC%E8%81%AF%E4%BA%A4%E6%89%80%E5%8F%8A%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%B6%B2%E7%AB%99%E5%88%8A%E7%99%BB%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) The Company will dispatch the interim report, containing all information required by the Listing Rules, to shareholders at the appropriate time, and publish it on the HKEX website and the Company's website - The Company will dispatch the interim report, containing all information required by the Listing Rules, to its shareholders at the appropriate time[91](index=91&type=chunk) - The interim report will be published on the HKEX website (www.hkexnews.hk) and the Company's website (www.paktakintl.com)[91](index=91&type=chunk)

[Financial Summary](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) H1 2025: EBITDA HKD 14.22M, loss to owners HKD 42.05M, revenue down 26.3%, net assets up 6.4% to HKD 4.02B Key Unaudited Financial Data for H1 2025 | Indicator | June 30, 2025 (HKD '000) | June 30, 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | **Income Statement:** | | | | | Total Revenue | 523,692 | 710,313 | -26.3 | | Operating Expenses | 411,705 | 484,046 | -14.9 | | Gross Profit from Non-Banking & Financial Business | 125,263 | 224,068 | -44.1 | | Gross Profit from Banking & Financial Business | 243,220 | 238,499 | 2.0 | | EBITDA | 14,216 | 83,843 | -83.0 | | Loss/Profit before Tax | (42,847) | 13,192 | N/A | | Net Loss/Profit after Tax | (51,649) | 3,708 | N/A | | Loss/Earnings per Share attributable to Owners of the Company (HK cents) | (0.97) | 0.16 | N/A | | **Balance Sheet (period-end):** | | | | | Total Assets | 20,088,793 | 17,963,825 | 11.8 | | Total Liabilities | 16,064,427 | 14,181,780 | 13.3 | | Total Equity | 4,024,366 | 3,782,045 | 6.4 | - The loss attributable to owners of the Company for the period was **HKD 42.05 million**[4](index=4&type=chunk) - The Group's net assets as of June 30, 2025, were **HKD 4.02 billion**, representing a **6.4% increase** compared to December 31, 2024[4](index=4&type=chunk) [Management Discussion and Analysis](index=2&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) The Group aims to be a diversified, sustainable conglomerate, implementing strategic measures across its watch, banking, and investment segments to optimize operations, control costs, and enhance competitiveness despite challenges - The Group aims to continuously be a diversified conglomerate with sustainable long-term development capabilities[5](index=5&type=chunk) - The Group comprises three main segments: watch, clock products and watch accessories business, banking and financial business, and various investment businesses[8](index=8&type=chunk) [Our Strategy](index=2&type=section&id=%E6%88%91%E5%80%91%E4%B9%8B%E7%AD%96%E7%95%A5) The Group adopts a long-term corporate strategy, allocating capital and personnel to opportunistic areas to generate returns exceeding the cost of capital and foster sustainable growth - The Group formulates its corporate strategy from a long-term perspective, deploying capital and personnel into areas full of opportunities to create long-term returns exceeding the cost of capital[5](index=5&type=chunk) - The Group intends to continuously be a diversified conglomerate with sustainable long-term development capabilities[5](index=5&type=chunk) [Operating Results](index=3&type=section&id=%E7%B6%93%E7%87%9F%E6%A5%AD%E7%B8%BE) For H1 2025, total revenue decreased by 26.3% to HKD 523.69 million, operating expenses fell 14.9%, non-banking gross profit dropped 44.1%, while banking gross profit slightly increased 2.0%, leading to an 83.0% EBITDA reduction and a net loss of HKD 51.65 million H1 2025 Operating Results Overview | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 523,692 | 710,313 | -26.3 | | Operating Expenses | 411,705 | 484,046 | -14.9 | | Gross Profit from Non-Banking & Financial Business | 125,263 | 224,068 | -44.1 | | Gross Profit from Banking & Financial Business | 243,220 | 238,499 | 2.0 | | EBITDA | 14,216 | 83,843 | -83.0 | | Net Loss after Tax | (51,649) | 3,708 (Profit) | N/A | [I. Watch, Clock Products and Watch Accessories Business](index=4&type=section&id=I.%20%E9%90%98%E9%8C%B6%E3%80%81%E6%99%82%E8%A8%88%E7%94%A2%E5%93%81%E5%8F%8A%E9%90%98%E9%8C%B6%E9%85%8D%E4%BB%B6%E6%A5%AD%E5%8B%99) The watch business segment faced challenges in H1 2025 with widespread revenue declines, particularly for Corum, Eterna, and Ernest Borel, prompting inventory optimization, cost reduction, centralized management, and new product development H1 2025 Watch, Clock Products and Watch Accessories Business Segment Revenue and Net Profit/(Loss) | Company Name | Revenue (HKD) | Net Profit/(Loss) after Tax (HKD) | Revenue Growth/(Decline) (%) | | :--- | :--- | :--- | :--- | | Zhuhai Rossini Watch Industry Co., Ltd. | 100,326,000 | 2,497,000 | (32.4) | | Ebo Precision Group | 54,990,000 | 23,271,000 | (40.8) | | Ernest Borel Group | 37,420,000 | (12,427,000) | (6.6) | | Corum, Eterna and Tivoli Group | 20,413,000 | (27,177,000) | (80.1) | | Other Companies | 58,380,000 | (4,555,000) | (22.9) | [I.A Local Own Brands – Zhuhai Rossini Watch Industry Co., Ltd. and Ebo Precision Group](index=4&type=section&id=I.A%20%E6%9C%AC%E5%9C%B0%E8%87%AA%E6%9C%89%E5%93%81%E7%89%8C%EF%BC%8D%E7%8F%A0%E6%B5%B7%E7%BE%85%E8%A5%BF%E5%B0%BC%E8%A1%A8%E6%A5%AD%E6%9C%89%E9%99%90%E5%85%AC%E5%8F%B8%E5%8F%8A%E4%BE%9D%E6%B3%A2%E7%B2%BE%E5%93%81%E9%9B%86%E5%9C%98) Local own brands are addressing market challenges by optimizing inventory and receivables, implementing cost reduction and efficiency measures, strengthening centralized control, and investing in smartwatches and cultural creative product lines - Inventory and accounts receivable management were optimized, leading to a decrease in overall watch inventory value and improved capital efficiency, with bad debt risks significantly reduced through stratified collection and legal recovery measures[13](index=13&type=chunk) - Cost reduction and efficiency measures included cross-brand integration, establishment of regional management centers, streamlining redundant layers, implementation of a five-tier classification management system for national direct-operated stores, and optimization of organizational structure[15](index=15&type=chunk) - New product R&D and innovation involved active investment in smartwatch R&D and production, collaboration with third-party tech companies, and expansion into cultural creative product lines, including wedding and business jewelry watch series, targeting the light luxury accessories market[14](index=14&type=chunk)[16](index=16&type=chunk) [I.B International Own Brand – Ernest Borel Group](index=6&type=section&id=I.B%20%E5%9C%8B%E5%A4%96%E8%87%AA%E6%9C%89%E5%93%81%E7%89%8C%EF%BC%8D%E4%BE%9D%E6%B3%A2%E8%B7%AF%E9%9B%86%E5%9C%98) Ernest Borel Group is optimizing inventory through precise evaluation and strict approval, promoting slow-moving items via overseas channels and e-commerce, enhancing official media promotion, and planning expansion into Southeast Asian and North American markets - Inventory structure optimization involved precise real-time inventory evaluation, ordering only when out of stock, and strict cross-departmental approval processes to effectively avoid duplicate orders and reduce inventory pressure[18](index=18&type=chunk) - Promotion activities were strengthened through active management of official media platforms like Weibo, WeChat, Xiaohongshu, Douyin, Kuaishou, Facebook, and Instagram to enhance brand exposure, alongside in-store multi-level gift-with-purchase events and new product promotions during key holidays[20](index=20&type=chunk) - Channel expansion for 2025 focuses on Southeast Asian and North American markets, improving duty-free store sales, launching region-specific products, optimizing channel distribution, establishing strategic distribution partnerships, entering major e-commerce and retail channels, and exploring collaborations with live-streaming platforms[21](index=21&type=chunk) [I.C Non-Own Brands](index=8&type=section&id=I.C%20%E9%9D%9E%E8%87%AA%E6%9C%89%E5%93%81%E7%89%8C) For H1 2025, the Group's four distribution companies for non-own brands recorded revenue of HKD 38.94 million, a 28.8% year-on-year decrease, and a net loss after tax of HKD 1.93 million, an increase in loss H1 2025 Financial Performance of Non-Own Brand Business | Indicator | H1 2025 (HKD) | H1 2024 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 38,942,000 | 54,669,000 | -28.8 | | Net Loss after Tax | (1,927,000) | (1,717,000) | 12.2 (Loss Widened) | [I.D Others](index=8&type=section&id=I.D%20%E5%85%B6%E4%BB%96) Other non-core watch, clock products, and watch accessories business subsidiaries recorded revenue of HKD 19.44 million in H1 2025, a 7.7% year-on-year decrease, and a significantly widened net loss after tax of HKD 2.63 million H1 2025 Financial Performance of Other Watch Businesses | Indicator | H1 2025 (HKD) | H1 2024 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 19,438,000 | 21,064,000 | -7.7 | | Net Loss after Tax | (2,628,000) | (715,000) | 267.6 (Loss Widened) | [II.A Wealthy Land Bank Co., Ltd.](index=8&type=section&id=II.A%20%E5%AF%8C%E5%9C%B0%E9%8A%80%E8%A1%8C%E8%82%A1%E4%BB%BD%E6%9C%89%E9%99%90%E5%85%AC%E5%8F%B8) Wealthy Land Bank's H1 2025 revenue grew 2.0% to HKD 243.22 million, with net profit attributable to owners up 0.7%, driven by a 63% surge in trading income despite a 7.2% drop in net interest and dividend income, while total assets and AUM significantly increased H1 2025 Key Financial Data for Wealthy Land Bank | Indicator | H1 2025 (HKD) | H1 2024 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 243,220,000 | 238,499,000 | 2.0 | | Net Profit after Tax attributable to Owners of the Company | 45,713,000 | 45,393,000 | 0.7 | | Net Interest and Dividend Income | 128,508,000 | 138,474,000 | -7.2 | | Net Commission and Service Fee Income (CHF) | +400,000 | - | +4.0 | | Trading Income | 20,941,000 | 12,941,000 (Estimated) | +63.0 | | Operating Expenses | 168,460,000 | 171,198,000 | -1.6 | | Total Assets | 15,485,785,000 | 13,432,540,000 (Dec 31, 2024) | 15.3 | | Assets Under Management (CHF) | 3,900,000,000 | 3,500,000,000 (Dec 2024) | 11.4 | | Total Capital Ratio | 20.3% | - | - | | Leverage Ratio | 6.6% | - | - | | Liquidity Coverage Ratio | 487% | - | - | - The decrease in net interest and dividend income was primarily due to anticipated interest rate cuts and the depreciation of the US dollar against the Swiss franc[24](index=24&type=chunk) - The significant increase in trading income was mainly attributable to higher client trading volumes in foreign exchange business[25](index=25&type=chunk) - The bank continues to advance its HORIZON strategy and has developed specific strategies for Asia, thoroughly analyzing business opportunities in Indonesia, the Philippines, and Japan[27](index=27&type=chunk) - Digital transformation of internal client onboarding processes is being accelerated to expedite account opening and enhance transparency[28](index=28&type=chunk) - Wealthy Land Wealth Management (Hong Kong) Limited continues to provide wealth management solutions for high-net-worth individuals in Asia, covering Hong Kong, Singapore, and Liechtenstein[28](index=28&type=chunk) [III.A Listed Equity Investments](index=11&type=section&id=III.A%20%E4%B8%8A%E5%B8%82%E8%82%A1%E6%9C%AC%E6%8A%95%E8%B3%87) The Group's listed equity investments include Citychamp Dartong New Materials Co., Ltd. and Min Xin Holdings Limited, with Citychamp Dartong generating fair value gains due to rising share prices, while Min Xin Holdings incurred fair value losses from declining share prices, which the Group intends to hold long-term Listed Equity Investments Overview (June 30, 2025) | Investment Item | Number of Shares Held | Market Price (per share) | Fair Value (HKD) | % of Total Assets | Net Fair Value Change Gain/(Loss) (HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Citychamp Dartong New Materials Co., Ltd. | 9,154,370 shares | RMB 2.98 (HKD 3.26) | 29,879,000 | 0.15 | 4,066,000 (Gain) | | Min Xin Holdings Limited | 88,150,000 shares | HKD 2.1 | 185,115,000 | 0.92 | (17,630,000) (Loss) | - The Group's investment in Citychamp Dartong generated a net fair value change gain of **HKD 4.07 million** recognized in other comprehensive income, primarily due to an increase in share price[32](index=32&type=chunk) - The Group's investment in Min Xin generated a net fair value change loss of **HKD 17.63 million**, primarily due to a decrease in share price[34](index=34&type=chunk) [III.B Property Investments](index=12&type=section&id=III.B%20%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) The Group's property investments in mainland China and Hong Kong are fully leased, generating stable rental income of HKD 8.94 million in H1 2025, a 25.5% year-on-year decrease, with net profit after tax falling 34.5% to HKD 7.69 million H1 2025 Financial Performance of Property Investment Business | Indicator | H1 2025 (HKD) | H1 2024 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Rental Income | 8,943,000 | 11,992,000 | -25.5 | | Net Profit after Tax | 7,692,000 | 11,729,000 | -34.5 | [Liquidity, Financial Resources and Capital Structure](index=13&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E3%80%81%E8%B2%A1%E6%94%BF%E8%B3%87%E6%BA%90%E5%8F%8A%E8%B3%87%E6%9C%AC%E6%9E%B6%E6%A7%8B) As of June 30, 2025, the Group's unsecured cash and bank balances significantly decreased to HKD 1.09 billion, while the debt-to-equity ratio improved to 19.1%, with capital commitments of HKD 270 million primarily for associate and property investments, and borrowings secured by subsidiary guarantees and property charges Liquidity and Capital Structure Overview | Indicator | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Unsecured Cash and Bank Balances | 1,094,118 | 3,724,213 | -70.6 | | Borrowings | 534,350 | 595,082 | -10.3 | | Shareholders' Equity | 4,024,366 | 3,782,045 | 6.4 | | Debt-to-Equity Ratio | 19.1% | 22.0% | -2.9 percentage points | - Total capital commitments amounted to approximately **HKD 270 million**, primarily invested in an associate company and a property project[37](index=37&type=chunk) - Borrowings are primarily secured by corporate guarantees provided by certain subsidiaries, equity interests, and legal charges over land and buildings of non-banking and financial businesses with a carrying value of **HKD 236.13 million**[39](index=39&type=chunk) [Financial Review](index=14&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's total assets grew 11.8% to HKD 20.09 billion, driven by a significant increase in amounts due from banks, while total liabilities rose 13.3% due to increased amounts due to customers, resulting in a net loss attributable to owners of HKD 42.05 million [(1) Total Assets](index=14&type=section&id=(1)%20%E7%B8%BD%E8%B3%87%E7%94%A2) The Group's total assets increased by 11.8% from HKD 17.96 billion to HKD 20.09 billion as of June 30, 2025, with cash and deposits significantly decreasing by 70.6% while amounts due from banks substantially increased by 115.9% Changes in Total Asset Composition | Indicator | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 20,088,793 | 17,963,825 | 11.8 | | Cash and Bank Balances | 51,468 | 66,336 | -22.4 | | Cash Held for Customers | 46,411 | 57,917 | -19.9 | | Demand Deposits with Central Banks | 1,042,650 | 3,657,877 | -71.5 | | Amounts Due from Banks - Daily | 5,820,401 | 2,696,501 | 115.9 | | Amounts Due from Banks - Other Claims | 66,355 | 56,341 | 17.8 | | Amounts Due from Banks - Precious Metals | 259,632 | 192,782 | 34.7 | [(2) Investments](index=14&type=section&id=(2)%20%E6%8A%95%E8%B3%87) The Group's investment portfolio includes trading portfolio investments, derivative financial assets, other financial assets at amortized cost, and other financial assets at fair value through other comprehensive income, primarily comprising listed equity and diversified debt instruments Investment Portfolio Overview (June 30, 2025) | Investment Category | Amount (HKD '000) | | :--- | :--- | | Trading Portfolio Investments | 35,426 | | Derivative Financial Assets | 923 | | Other Financial Assets at Amortized Cost | 4,670,112 | | Other Financial Assets at Fair Value through Other Comprehensive Income | 220,486 | - Trading portfolio investments are primarily held to maintain a certain level of liquidity for unforeseen capital expenditures and to generate short-term returns from listed equities[44](index=44&type=chunk) - The portfolio of listed debt instruments at amortized cost consists of 60 instruments diversified by maturity, geography, segment, and currency, with the vast majority considered upper-medium grade instruments with low credit risk[48](index=48&type=chunk) [(3) Total Liabilities](index=19&type=section&id=(3)%20%E7%B8%BD%E8%B2%A0%E5%82%B5) The Group's total liabilities increased by 13.3% to HKD 16.06 billion as of June 30, 2025, primarily due to an increase in amounts due to customers Changes in Total Liability Composition | Indicator | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Total Liabilities | 16,064,427 | 14,181,780 | 13.3 | | Amounts Due to Customers - Precious Metals | 259,308 | 193,069 | 34.3 | | Other Amounts Due to Customers (primarily bank deposits) | 14,014,828 | 12,140,101 | 15.4 | [(4) Gross Profit from Non-Banking and Financial Businesses](index=19&type=section&id=(4)%20%E9%9D%9E%E9%8A%80%E8%A1%8C%E5%8F%8A%E9%87%91%E8%9E%8D%E6%A5%AD%E5%8B%99%E4%B9%8B%E6%AF%9B%E5%88%A9) Gross profit from non-banking and financial businesses decreased by HKD 98.81 million, or 44.1%, to HKD 125.26 million compared to the same period last year Gross Profit from Non-Banking and Financial Businesses | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit from Non-Banking & Financial Business | 125,263 | 224,068 | -44.1 | [(5) Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)](index=20&type=section&id=(5)%20%E7%A8%85%E6%81%AF%E6%8A%98%E8%88%8A%E5%8F%8A%E6%94%A4%E9%8A%B7%E5%89%8D%E5%88%A9%E6%BD%A4(EBITDA)) Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) decreased by HKD 69.63 million, or 83.0%, to HKD 14.22 million compared to the same period last year EBITDA | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | EBITDA | 14,216 | 83,843 | -83.0 | [(6) Selling and Distribution Expenses](index=20&type=section&id=(6)%20%E9%8A%B7%E5%94%AE%E5%8F%8A%E5%88%86%E9%8A%B7%E8%B2%BB%E7%94%A8) Total selling and distribution expenses decreased by HKD 44.46 million, or 28.9%, to HKD 109.39 million compared to the same period last year Selling and Distribution Expenses | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Selling and Distribution Expenses | 109,386 | 153,846 | -28.9 | [(7) Administrative Expenses](index=20&type=section&id=(7)%20%E8%A1%8C%E6%94%BF%E8%B2%BB%E7%94%A8) Total administrative expenses decreased by HKD 27.88 million, or 8.4%, to HKD 302.32 million compared to the same period last year Administrative Expenses | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 302,319 | 330,200 | -8.4 | [(8) Share of Profit of an Associate](index=20&type=section&id=(8)%20%E6%87%89%E4%BD%94%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E6%BA%A2%E5%88%A9) Share of profit from associate Jun Guang Industrial Co., Ltd. decreased by 26.7% to HKD 4.15 million, with Jun Guang being a leading OEM quartz watch manufacturer in mainland China Share of Profit of an Associate | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Share of Profit of an Associate | 4,147 | 5,655 | -26.7 | [(9) Finance Costs for Non-Banking Businesses](index=20&type=section&id=(9)%20%E9%9D%9E%E9%8A%80%E8%A1%8C%E6%A5%AD%E5%8B%99%E4%B9%8B%E8%B2%A1%E5%8B%99%E8%B2%BB%E7%94%A8) Finance costs for non-banking businesses decreased by 1.2% to HKD 21.78 million, primarily comprising interest expenses on bank borrowings, bank overdrafts, and lease liabilities Finance Costs for Non-Banking Businesses | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Finance Costs for Non-Banking Businesses | 21,782 | 22,045 | -1.2 | [(10) Net Loss Attributable to Owners of the Company](index=20&type=section&id=(10)%20%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%93%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%94%E虧%E6%90%8D%E6%B7%A8%E9%A1%8D) The net loss attributable to owners of the Company was HKD 42.05 million, compared to a net profit of HKD 7.02 million in the same period last year Net Loss Attributable to Owners of the Company | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | Net Loss Attributable to Owners of the Company | (42,045) | 7,024 (Profit) | [(11) Inventories](index=20&type=section&id=(11)%20%E5%AD%98%E8%B2%A8) Inventories increased by 1.9% to HKD 1.54 billion as of June 30, 2025, compared to December 31, 2024 Inventories | Indicator | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | Change (%) | | :--- | :--- | :--- | :--- | | Inventories | 1,542,781 | 1,513,833 | 1.9 | [(12) Events After the Reporting Period](index=20&type=section&id=(12)%20%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) The Group has no significant events after the reporting period requiring disclosure as of the date of this announcement - The Group has no significant events after the reporting period requiring disclosure[63](index=63&type=chunk) [Condensed Consolidated Statement of Comprehensive Income](index=21&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E5%85%A5%E8%A1%A8) For H1 2025, the Group reported total revenue of HKD 523.69 million, a 26.3% year-on-year decrease, with a net loss of HKD 51.65 million, and total other comprehensive income of HKD 291.69 million, primarily due to exchange differences on translation Condensed Consolidated Statement of Comprehensive Income Summary | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | Total Revenue | 523,692 | 710,313 | | Loss/Profit for the Period | (51,649) | 3,708 | | Other Comprehensive Income for the Period | 291,685 | (346,821) | | Total Comprehensive Income for the Period | 240,036 | (343,113) | | Loss/Profit for the Period attributable to Owners of the Company | (42,045) | 7,024 | | Total Comprehensive Income for the Period attributable to Owners of the Company | 244,196 | (338,116) | | Basic and Diluted Loss/Earnings per Share (HK cents) | (0.97) | 0.16 | - Other comprehensive income for the period was primarily affected by exchange differences on translation of presenting currency of **HKD 302.39 million**[65](index=65&type=chunk) [Condensed Consolidated Statement of Financial Position](index=23&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) As of June 30, 2025, total assets increased 11.8% to HKD 20.09 billion, total liabilities rose 13.3% to HKD 16.06 billion, and total equity grew 6.4% to HKD 4.02 billion, with a significant increase in amounts due from banks and a decrease in cash and deposits Condensed Consolidated Statement of Financial Position Summary | Indicator | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | **Assets:** | | | | Cash and Deposits | 1,140,529 | 3,782,130 | | Amounts Due from Customers | 2,942,445 | 2,659,182 | | Amounts Due from Banks | 6,145,570 | 2,945,270 | | Trading Portfolio Investments | 35,426 | 39,564 | | Other Financial Assets at Amortized Cost | 4,670,112 | 3,511,829 | | Total Assets | 20,088,793 | 17,963,825 | | **Liabilities:** | | | | Amounts Due to Customers | 14,274,136 | 12,333,170 | | Borrowings | 534,350 | 595,082 | | Total Liabilities | 16,064,427 | 14,181,780 | | **Equity:** | | | | Total Equity | 4,024,366 | 3,782,045 | - Total assets increased primarily due to a significant rise in amounts due from banks, from **HKD 2.95 billion** to **HKD 6.15 billion**[66](index=66&type=chunk) - Total liabilities increased mainly attributable to amounts due to customers, from **HKD 12.33 billion** to **HKD 14.27 billion**[67](index=67&type=chunk) [Notes to the Unaudited Condensed Consolidated Interim Financial Information](index=25&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) This section provides detailed notes to the unaudited condensed consolidated interim financial information for the six months ended June 30, 2025, covering preparation basis, accounting policies, segment information, revenue, other income, finance costs, income tax, dividends, EPS, investments, receivables, payables, inventories, intangible assets, goodwill, and borrowings [1. Basis of Preparation](index=25&type=section&id=1.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) The unaudited condensed interim financial information is prepared in accordance with HKAS 34 Interim Financial Reporting and Appendix D2 of the Listing Rules, presented in HKD, and approved for publication by the Board - The unaudited interim financial information has been prepared in accordance with HKAS 34 and Appendix D2 of the Listing Rules[68](index=68&type=chunk) - All amounts have been rounded to the nearest thousand (HKD '000) and were approved for publication by the Board on August 28, 2025[68](index=68&type=chunk) [2. Summary of Significant Accounting Policies](index=25&type=section&id=2.%20%E9%87%8D%E5%A4%A7%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96%E8%B3%87%E6%96%99%E6%A6%82%E8%A6%81) The unaudited interim financial information is prepared using the same accounting policies and calculation methods as the 2024 annual financial statements, with no early adoption of new or revised HKFRSs - The unaudited interim financial information has been prepared in accordance with the accounting policies and methods of computation used in the 2024 annual financial statements[69](index=69&type=chunk) - The Group has not early adopted any new or revised HKFRSs that have been issued but are not yet effective[69](index=69&type=chunk) [3. Segment Information](index=25&type=section&id=3.%20%E5%88%86%E9%A1%9E%E8%B3%87%E6%96%99) The Group's operating segments include watch and clock products, property investment, and banking and financial businesses, with H1 2025 segment results showing a loss of HKD 53.48 million for watches, profit of HKD 7.69 million for property, and profit of HKD 53.61 million for banking - The Group's principal operating segments are: (a) manufacture and distribution of watch and clock products and watch accessories; (b) property investment; and (c) banking and financial business[71](index=71&type=chunk) H1 2025 Segment Results | Segment | Segment Revenue (HKD '000) | Segment Results (HKD '000) | | :--- | :--- | :--- | | Watch and Clock Products and Watch Accessories Business | 271,529 | (53,479) | | Property Investment | 8,943 | 7,692 | | Banking and Financial Business | 243,220 | 53,609 | | Total | 523,692 | 7,822 | [4. Revenue](index=28&type=section&id=4.%20%E6%94%B6%E5%85%A5) The Group's revenue primarily derives from banking net interest, service and commission, and trading income, alongside non-banking goods sales and rental income, with H1 2025 seeing a decline in banking net interest and service fees but a significant increase in trading income, and a substantial decrease in non-banking goods sales - The Group is principally engaged in the manufacture and distribution of watch and clock products and watch accessories business, property investment and banking and financial business[74](index=74&type=chunk) H1 2025 Revenue Composition | Revenue Category | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | Net Interest Income from Banking Business | 127,667 | 138,236 | | Net Service Fee and Commission Income from Banking Business | 93,466 | 86,937 | | Trading Income from Banking Business | 20,941 | 13,147 | | Income from Financial Business | 1,146 | 179 | | Sales of Goods from Non-Banking & Financial Business | 271,529 | 459,822 | | Rental Income from Non-Banking & Financial Business | 8,943 | 11,992 | | Total Revenue | 523,692 | 710,313 | [5. Other Recurring Income and Net Other Gains or Losses](index=30&type=section&id=5.%20%E5%85%B6%E4%BB%96%E7%B6%93%E5%B8%B8%E6%80%A7%E6%94%B6%E5%85%A5%E5%8F%8A%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E6%88%96%E虧%E6%90%8D%E6%B7%A8%E9%A1%8D) Other recurring income and net other gains or losses significantly decreased to HKD 18.01 million for H1 2025, down from HKD 51.06 million in the prior year, primarily due to lower net exchange gains, dividend income from financial assets at fair value through other comprehensive income, and other miscellaneous income Other Recurring Income and Net Gains | Item | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | Net Exchange Gains | 3,124 | 16,059 | | Net Fair Value Change Gains on Trading Portfolio Investments | 62 | 72 | | Fair Value Change Gains on Financial Liabilities at Fair Value through Profit or Loss | 12,495 | 12,162 | | Dividend Income from Financial Assets at Fair Value through Other Comprehensive Income | – | 7,934 | | Other Miscellaneous Income | 717 | 11,709 | | Total | 18,010 | 51,061 | [6. Finance Costs for Non-Banking and Financial Businesses](index=31&type=section&id=6.%20%E9%9D%9E%E9%8A%80%E8%A1%8C%E5%8F%8A%E9%87%91%E8%9E%8D%E6%A5%AD%E5%8B%99%E4%B9%8B%E8%B2%A1%E5%8B%99%E8%B2%BB%E7%94%A8) Finance costs for non-banking and financial businesses slightly decreased by 1.2% to HKD 21.78 million, primarily comprising interest expenses on lease liabilities, bank borrowings, bank overdrafts, and other borrowings Finance Costs for Non-Banking and Financial Businesses | Item | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | Interest on Lease Liabilities | 2,657 | 1,645 | | Interest Expenses on Bank Borrowings, Bank Overdrafts and Other Borrowings | 19,125 | 20,400 | | Total | 21,782 | 22,045 | [7. Loss/Profit Before Income Tax](index=31&type=section&id=7.%20%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%85%E5%89%8D%EF%BC%88%E虧%E6%90%8D%EF%BC%89%E2%88%95%E6%BA%A2%E5%88%A9) The Group recorded a loss before income tax of HKD 42.85 million, compared to a profit of HKD 13.19 million in the prior year, after deducting depreciation of property, plant and equipment of HKD 30.17 million and amortization of intangible assets of HKD 5.11 million Loss/Profit Before Income Tax | Indicator | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | Loss/Profit Before Income Tax | (42,847) | 13,192 | | Depreciation of Property, Plant and Equipment | 30,167 | 48,627 | | Amortization of Intangible Assets | 5,114 | 6,043 | [8. Income Tax Expense](index=31&type=section&id=8.%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Total income tax expense for the period was HKD 8.80 million, a 7.2% decrease year-on-year, with no Hong Kong profits tax provision, Chinese subsidiaries taxed at 15% to 25%, and overseas taxes calculated at applicable rates Income Tax Expense | Item | H1 2025 (HKD '000) | H1 2024 (HKD '000) | | :--- | :--- | :--- | | People's Republic of China | 1,571 | 1,447 | | Liechtenstein | 7,722 | 7,457 | | Switzerland | – | 332 | | Deferred Tax for the Period | (491) | 248 | | Total Income Tax Expense | 8,802 | 9,484 | - No provision for Hong Kong profits tax has been made as the Group did not generate any assessable profits in Hong Kong[82](index=82&type=chunk) - Dividend income from companies incorporated in China is subject to a 5% PRC withholding tax[83](index=83&type=chunk) [9. Dividends](index=31&type=section&id=9.%20%E8%82%A1%E6%81%AF) The Directors do not recommend the payment of an interim dividend for the period ended June 30, 2025 - The Directors do not recommend the payment of an interim dividend for the period ended June 30, 2025[84](index=84&type=chunk) [10. Loss/Earnings Per Share](index=32&type=section&id=10.%20%E6%AF%8F%E8%82%A1%EF%BC%88%E虧%E6%90%8D%EF%BC%89%E2%88%95%E7%87%9F%E5%88%A9) For the six months ended June 30, 2025, both basic and diluted loss per share attributable to owners of the Company were 0.97 HK cents, compared to earnings per share of 0.16 HK cents in the prior year Loss/Earnings Per Share | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss/Profit attributable to Owners of the Company (HKD '000) | (42,045) | 7,024 | | Weighted Average Number of Shares (thousands) | 4,351,889 | 4,351,889 | | Basic and Diluted Loss/Earnings per Share (HK cents) | (0.97) | 0.16 | [11. Trading Portfolio Investments](index=32&type=section&id=11.%20%E4%BA%A4%E6%98%93%E7%B5%84%E5%90%88%E6%8A%95%E8%B3%87) As of June 30, 2025, total trading portfolio investments decreased by 10.4% to HKD 35.43 million, primarily comprising Hong Kong-listed equity instruments, unlisted debt instruments, and unlisted investment fund units, with a fair value gain of HKD 62,000 for the period Trading Portfolio Investments | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Total Equity Instruments | 15,343 | 15,639 | | Unlisted Debt Instruments of Financial Institutions | 250 | 4,439 | | Unlisted Investment Fund Units | 19,833 | 19,486 | | Total Trading Portfolio Investments | 35,426 | 39,564 | - Investments under trading portfolio investments are held for trading purposes, with a fair value gain of **HKD 62,000** for the period[88](index=88&type=chunk)[89](index=89&type=chunk) [12. Financial Assets at Fair Value Through Other Comprehensive Income](index=33&type=section&id=12.%20%E6%8C%89%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E5%85%A5%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E5%85%A5%E4%B9%8B%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) As of June 30, 2025, financial assets at fair value through other comprehensive income totaled HKD 220.49 million, a 5.7% decrease, primarily comprising listed equity interests in Min Xin Holdings Limited (Hong Kong) and Citychamp Dartong Co., Ltd. (outside Hong Kong), with a fair value decrease of HKD 13.56 million for the period Financial Assets at Fair Value Through Other Comprehensive Income | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Listed Equity Instruments in Hong Kong | 185,115 | 202,745 | | Listed Equity Instruments outside Hong Kong | 29,878 | 25,812 | | Unlisted Equity Investments | 5,493 | 5,336 | | Total | 220,486 | 233,893 | - The fair value of financial assets at fair value through other comprehensive income decreased by **HKD 13.56 million** during the period[90](index=90&type=chunk) - Listed equity investments in Hong Kong refer to a **14.76% equity interest** in Min Xin Holdings Limited, while listed equity investments outside Hong Kong refer to a **0.66% equity interest** in Citychamp Dartong Co., Ltd[91](index=91&type=chunk) [13. Trade Receivables](index=34&type=section&id=13.%20%E6%87%89%E6%94%B6%E8%B3%87%E6%AC%BE) As of June 30, 2025, total trade receivables slightly decreased by 1.0% to HKD 368.22 million, with the majority originating from the watch, clock products, and watch accessories business, and the largest portion of aging over six months Trade Receivables Composition and Aging Analysis | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Trade Receivables from Watch, Clock Products and Watch Accessories Business | 358,135 | 370,311 | | Trade Receivables from Financial Business - Cash Clients | 10,089 | 1,800 | | Total | 368,224 | 372,111 | | **Aging of Watch Business Trade Receivables:** | | | | 1 to 3 Months | 89,518 | 73,523 | | 4 to 6 Months | 82,244 | 21,555 | | Over 6 Months | 186,373 | 275,233 | - Major customers are generally granted credit terms of one to six months, determined by management based on industry practice and client creditworthiness[92](index=92&type=chunk) [14. Other Financial Assets at Amortized Cost](index=34&type=section&id=14.%20%E6%8C%89%E6%94%A4%E9%8A%B7%E6%88%90%E6%9C%AC%E5%88%97%E8%B3%B9%E4%B9%8B%E5%85%B6%E4%BB%96%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) As of June 30, 2025, listed debt instruments at amortized cost increased by 33.0% to HKD 4.67 billion, primarily issued by governments and public sector entities, followed by financial institutions and corporations Other Financial Assets at Amortized Cost | Issuer | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Governments and Public Sector Entities | 3,715,433 | 2,519,712 | | Financial Institutions | 528,323 | 542,825 | | Corporations | 426,356 | 449,292 | | Total | 4,670,112 | 3,511,829 | [15. Inventories](index=35&type=section&id=15.%20%E5%AD%98%E8%B2%A8) As of June 30, 2025, total inventories increased by 1.9% to HKD 1.54 billion, with a significant increase in work-in-progress, while raw materials and finished goods and merchandise decreased Inventories Composition | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Raw Materials | 187,656 | 274,076 | | Work-in-Progress | 618,323 | 310,614 | | Finished Goods and Merchandise | 736,802 | 929,143 | | Total | 1,542,781 | 1,513,833 | [16. Intangible Assets](index=35&type=section&id=16.%20%E7%84%A1%E5%BD%A2%E8%B3%87%E7%94%A2) As of June 30, 2025, the carrying value of intangible assets slightly increased to HKD 81.86 million, primarily comprising brand names, technical know-how, and customer relationships, all attributable to the watch, clock products, and watch accessories business Carrying Value of Intangible Assets | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Brand Names | 49,190 | 42,819 | | Computer Software | 1,143 | 1,181 | | Technical Know-how | 26,011 | 26,899 | | Customer Relationships | 5,518 | 8,721 | | Total | 81,862 | 79,620 | - All intangible assets are attributable to the watch, clock products and watch accessories business[94](index=94&type=chunk) [17. Goodwill](index=36&type=section&id=17.%20%E5%95%86%E8%AD%BD) As of June 30, 2025, the carrying value of goodwill increased by 9.1% to HKD 1.06 billion, with HKD 759.45 million attributable to the watch, clock products, and watch accessories business, and HKD 302.44 million to the banking and financial business Carrying Value of Goodwill | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Balance at Period/Beginning of Year | 1,061,886 | 973,406 | | Goodwill from Watch, Clock Products and Watch Accessories Business | 759,447 | 710,120 | | Goodwill from Banking and Financial Business | 302,439 | 263,286 | [18. Trade Payables](index=36&type=section&id=18.%20%E6%87%89%E4%BB%98%E8%B3%87%E6%AC%BE) As of June 30, 2025, total trade payables decreased by 10.0% to HKD 171.44 million, with the majority originating from the watch, clock products, and watch accessories business, and the proportion of aging over six months increasing Trade Payables Composition and Aging Analysis | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Trade Payables from Watch, Clock Products and Watch Accessories Business | 169,089 | 187,775 | | Trade Payables from Financial Business - Cash Clients | 2,346 | 2,346 | | Total | 171,435 | 190,121 | | **Aging of Watch Business Trade Payables:** | | | | 1 to 3 Months | 48,693 | 127,183 | | 4 to 6 Months | 31,719 | 9,152 | | Over 6 Months | 88,677 | 51,440 | [19. Borrowings](index=37&type=section&id=19.%20%E5%80%9F%E8%B2%B8) As of June 30, 2025, total Group borrowings decreased by 10.3% to HKD 534.35 million, primarily comprising bank overdrafts, bank borrowings, and other loans, secured by various assets, with no covenant breaches known to the Directors Borrowings Composition | Item | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Bank Overdrafts | 25,512 | 29,519 | | Bank Borrowings | 413,573 | 470,628 | | Other Loans | 95,265 | 94,935 | | Total | 534,350 | 595,082 | - Borrowings are primarily secured by corporate guarantees provided by certain subsidiaries of the Group, equity interests, subordinated deeds signed by directors, guarantees from certain national governments, personal guarantees, legal charges over certain property, plant and equipment, standby letters of credit, and personal guarantees provided by the Directors of the Company[99](index=99&type=chunk)[102](index=102&type=chunk) - As of the date of this announcement, the Directors of the Company are not aware of any covenant breaches[100](index=100&type=chunk) [Outlook](index=39&type=section&id=%E5%89%8D%E6%99%AF) China's economy is projected to continue growing, driven by exports and government fiscal measures, though global risks like Middle East tensions and the Ukraine war persist, while the Group anticipates a gradual recovery in China's consumer market and will actively pursue its Asia strategy for Wealthy Land Bank - The International Monetary Fund has significantly raised China's GDP growth forecast for 2025 from 4.0% to **4.8%**, and for 2026 to **4.2%**[103](index=103&type=chunk) - China's economic growth is primarily driven by exports, with the depreciation of the RMB enhancing export competitiveness, while government fiscal measures provide some support for domestic consumption[103](index=103&type=chunk) - Downside risks include potential disruptions to global supply chains and rising energy and raw material prices due to the Middle East situation and the Ukraine war, as well as high fiscal deficits in developed countries possibly leading to tighter capital flows and increased financing costs[104](index=104&type=chunk) - Wealthy Land Bank will actively promote its Asia strategy, explore business opportunities, and implement diverse asset management approaches to mitigate the impact of declining US dollar interest rates on its banking business[104](index=104&type=chunk) [Employees and Remuneration Policy](index=40&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the Group employed 2,037 full-time staff globally, with remuneration determined by market conditions and individual performance, including year-end bonuses, medical insurance, retirement benefits, and performance-based incentives, with Hong Kong employees participating in MPF and mainland China employees in social security schemes Employee Count (June 30, 2025) | Region | Number of Full-time Employees | | :--- | :--- | | Hong Kong and Mainland China | 1,834 | | Europe | 203 | | Total | 2,037 | - Employee remuneration is determined and reviewed through fair negotiation, referencing market conditions and individual performance, and includes year-end double pay, medical insurance, and retirement benefits, with bonuses and incentives based on operating results and individual performance[105](index=105&type=chunk) - Hong Kong employees participate in the Mandatory Provident Fund Scheme, while employees of mainland China subsidiaries participate in social security schemes managed and operated by local authorities[105](index=105&type=chunk) [Interim Dividend](index=40&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board of Directors resolved not to declare an interim dividend for the six months ended June 30, 2025 - The Board of Directors resolved not to declare an interim dividend for the six months ended June 30, 2025[106](index=106&type=chunk) [Corporate Governance Code](index=40&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) The Company complied with the applicable code provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules for H1 2025, except for the Chairman's absence from the AGM due to other commitments - The Company has complied with the applicable code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules[107](index=107&type=chunk) - The Chairman of the Board was unable to attend the Company's Annual General Meeting held on May 29, 2025, due to other commitments, which is an exception to Code Provision F.2.2 of the Corporate Governance Code[107](index=107&type=chunk) [Standard Code for Securities Transactions by Directors](index=41&type=section&id=%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%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 adopted the Standard Code as the code of conduct for Directors' securities transactions, and all Directors confirmed compliance with its required standards for the six months ended June 30, 2025 - The Company has adopted the Standard Code as the code of conduct for Directors' dealings in the Company's securities[108](index=108&type=chunk) - The Directors have confirmed compliance with the required standards set out in the Standard Code for the six months ended June 30, 2025[108](index=108&type=chunk) [Corporate Governance](index=41&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Board and management are committed to maintaining high corporate governance standards, emphasizing ethical conduct, transparency, and responsible decision-making, supported by a robust governance structure adapted to the evolving business environment - The Board and management team are committed to maintaining and enhancing high standards of corporate governance, emphasizing ethical conduct, transparency, and responsible decision-making[109](index=109&type=chunk) - The Group has established a robust governance framework, with the assistance of external professional advisors and internal expertise, designed to adapt to the evolving business environment[109](index=109&type=chunk) [Environmental, Social and Governance (ESG)](index=41&type=section&id=%E7%92%B0%E5%A2%83%E3%80%81%E7%A4%BE%E6%9C%83%E5%8F%8A%E7%AE%A1%E6%B2%BB%EF%BC%88ESG%EF%BC%89) ESG is integral to the Group's sustainable practices, focusing on environmental impact and energy efficiency, with the 2024 ESG report prepared under new climate disclosure standards for enhanced transparency - ESG is an integral part of the Group's responsible and sustainable business practices[110](index=110&type=chunk) - The Group is committed to improving energy efficiency and has prepared its 2024 ESG report in accordance with the new climate disclosure standards implemented by The Stock Exchange of Hong Kong Limited[110](index=110&type=chunk) [Risk Management](index=42&type=section&id=%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86) Risk management is paramount, with the Risk Management Committee regularly reviewing risks and emerging threats, while the Group assesses business resilience through internal controls, scenario analysis, and stress testing, ensuring functional separation in banking operations for effective oversight - The Risk Management Committee regularly convenes to review existing risks, identify emerging threats, and formulate comprehensive strategies to mitigate potential impacts[111](index=111&type=chunk) - The risk management approach includes establishing internal control systems, conducting scenario analysis, and stress testing to assess business resilience under various conditions[111](index=111&type=chunk) - In banking operations, functional separation of monitoring departments is ensured to facilitate independent oversight and effective communication of findings to senior management[111](index=111&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=42&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%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 any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025 - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025[112](index=112&type=chunk) [Review of Financial Statements](index=42&type=section&id=%E5%AF%A9%E9%96%B1%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) The Company's Audit Committee reviewed the Group's unaudited financial statements for the six months ended June 30, 2025, and was satisfied they were prepared in accordance with applicable accounting standards and fairly presented the Group's financial position and results - The Company's Audit Committee has reviewed the Group's unaudited financial statements for the six months ended June 30, 2025[113](index=113&type=chunk) - The Audit Committee is satisfied that the unaudited financial statements were prepared in accordance with applicable accounting standards and fairly presented the Group's financial position and results[113](index=113&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=42&type=section&id=%E5%88%8A%E8%BC%89%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%85%AC%E5%91%8A%E5%8F%8A%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) The 2025 interim results announcement has been published on the HKEX and Company websites, and the 2025 interim report will be dispatched to shareholders and published on both websites in due course - The 2025 interim results announcement has been published on the HKEX website (www.hkexnews.hk) and the Company's websites (www.irasia.com/listco/hk/citychamp and www.citychampwj.com)[114](index=114&type=chunk) - The 2025 interim report will be dispatched to the Company's shareholders in due course and will be published on the HKEX and the Company's websites, respectively[114](index=114&type=chunk) [Acknowledgement](index=43&type=section&id=%E8%87%B4%E6%84%8F) The Group's financial performance and strategic initiatives reflect the collective efforts of the Board and management, with Company Secretary Ho Suk Han extending sincere gratitude to employees, clients, suppliers, banks, advisors, partners, and shareholders for their strong support - The Group's financial performance and strategic initiatives fully reflect the collective efforts made by the Board and management to achieve their objectives[115](index=115&type=chunk) - Company Secretary Ho Suk Han, on behalf of the Board, extends sincere gratitude to employees, clients, suppliers, banks, professional advisors, business partners, and shareholders for their strong support[115](index=115&type=chunk)[116](index=116&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份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。 JIANGSU EXPRESSWAY COMPANY LIMITED 江蘇寧滬高速公路股份有限公司 （於中華人民共和國註冊成立的股份有限公司） （股份代號：00177） 2025年中期業績初步公告 本 公 告 第 一、三、五、六 章 的 內 容 乃 根 據 香 港 上 市 規 則 第13.49(6)條 及 附 錄D2第46段 規 定 作 出。 本 公 告 內 其 他 資 料 乃 根 據 上 海 證 券 交 易 所 股 票 上 市 規 則 作 出。 一. 重要提示 – 1 – 1.1 本 中 期 業 績 初 步 公 告 摘 要 來 自 半 年 度 報 告，為 全 面 了 解 本 公 司 的 經 營 成 果、財 務 狀 況 及 未 來 發 展 規 劃，投 資 者 應 當 到 上 海 證券交易所網站www.sse.com.cn、香 港 聯 合 ...

[Interim Results Announcement Summary](index=1&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%85%AC%E5%91%8A%E6%91%98%E8%A6%81) This section provides a concise overview of the company's financial performance and key operational highlights for the interim period [Financial Summary](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) Total revenue decreased by 6.97% YoY, but gross profit and profit for the period increased by 15.73% and 19.55% respectively, with adjusted net profit up 7.04% due to business optimization and high-margin services Financial Summary (For the six months ended June 30) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 3,030,150 | 3,257,164 | -6.97 | | Cost of Revenue | (2,828,542) | (3,082,955) | -8.25 | | Gross Profit | 201,608 | 174,209 | 15.73 | | Profit for the Period | 26,066 | 21,803 | 19.55 | | Profit Attributable to Owners of the Parent | 28,012 | 24,037 | 16.54 | | Adjusted Net Profit (Non-IFRS) | 26,761 | 25,002 | 7.04 | | Adjusted Net Profit Attributable to Owners of the Parent (Non-IFRS) | 28,707 | 27,236 | 5.40 | [Management Discussion and Analysis](index=2&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) This section analyzes the company's performance, market conditions, and strategic initiatives, providing context for the financial results [Market Overview](index=2&type=section&id=%E5%B8%82%E5%A0%B4%E6%A6%82%E8%A7%88) Digital freight platforms address traditional logistics inefficiencies through technology, supported by policy and market demand, evolving into comprehensive digital infrastructure for logistics and tax governance - Digital freight platforms connect over **8 million** trucks and **7 million** drivers, significantly enhancing social resource coordination efficiency[5](index=5&type=chunk) - State Council Decree No. 810 (2025) formally establishes data's legal validity in tax collection, making digital freight platforms central to logistics industry digital tax governance[6](index=6&type=chunk) - Market demands for digital freight platforms have shifted from singular cost reduction and efficiency improvement to multi-dimensional capabilities in capacity supply chain resilience, efficiency, and collaboration[9](index=9&type=chunk) [Group Overview](index=3&type=section&id=%E9%9B%86%E5%9C%98%E6%A6%82%E8%A7%88) The company operates China's largest digital freight platform, offering integrated transport, operations, and financial services through 12 digital business links, with AI significantly boosting efficiency and focusing on deep digitalization and high-quality GTV growth - The company operates China's largest digital freight platform, having served over **17,700** shippers and **3.7 million** truck drivers, completing a total of over **60.6 million** consignment orders as of June 30, 2025[10](index=10&type=chunk)[20](index=20&type=chunk) - A full-link digital freight system has been built across **12** business links, achieving integrated transport, operations, and financial services, and leveraging AI technology to enhance operational efficiency[11](index=11&type=chunk)[12](index=12&type=chunk) - AI digital human "Sister Ting" fully covers truck driver management and operations for logistics projects, reducing labor costs by **76%** compared to pre-AI application, significantly boosting operational efficiency and management effectiveness[14](index=14&type=chunk) - The company focuses on deepening digital application in logistics projects, selecting shippers with higher digital cooperation value, and pursuing high-quality online GTV growth[16](index=16&type=chunk) [Business Overview](index=6&type=section&id=%E6%A5%AD%E5%8B%99%E6%A6%82%E8%A7%88) This section details the company's business model, services, and the ecosystem it has built within the digital freight industry [Our Business Model and Services](index=6&type=section&id=%E6%88%91%E5%80%91%E7%9A%84%E6%A5%AD%E5%8B%99%E6%A8%A1%E5%BC%8F%E5%8F%8A%E6%9C%8D%E5%8B%99) The company has cultivated a vibrant digital road freight ecosystem in China, integrating "Digital Freight, Trucker Community, and Industry Resource Linkage" to meet shipper needs and support drivers, creating strong synergistic effects - The company's business layout includes digital freight, trucker community, and industry resource linkage, providing full-link digital services and solutions to all participants in the freight industry[17](index=17&type=chunk) - Digital freight business empowers shippers to build private capacity pools through digitalized capacity management, transport processes, and financial settlement, achieving cost reduction, efficiency improvement, and data-driven decision-making[19](index=19&type=chunk) - The large and loyal user base of the Trucker Community provides stable and efficient capacity resources for the digital freight platform, while the platform also attracts more drivers to join the Trucker Community, forming a mutually reinforcing synergy[38](index=38&type=chunk) [Digital Freight Business](index=6&type=section&id=%E6%95%B8%E5%AD%97%E8%B2%A8%E9%81%8B%E6%A5%AD%E5%8B%99) The digital freight business offers freight services and platform services, aiming to digitalize the entire transport process for shippers, enabling data-driven management and building an efficient and collaborative capacity supply chain - Digital freight business online GTV was approximately **RMB 17.9 billion** for the six months ended June 30, 2025, with an annual retention rate of approximately **91.2%** for key shipper clients[20](index=20&type=chunk) - Freight services online GTV was approximately **RMB 3.1 billion**, primarily serving industry clients with high standardization, such as bulk cargo[21](index=21&type=chunk) - Freight platform services online GTV was approximately **RMB 14.8 billion**, primarily serving shippers with complex processes and customized requirements, such as consumer goods, enhancing their operational capabilities through digitalization[22](index=22&type=chunk) [Trucker Community and Industry Resource Linkage](index=8&type=section&id=%E5%8D%A1%E5%8F%8B%E5%9C%B0%E5%B8%B6%E5%8F%8A%E7%94%A2%E6%A5%AD%E8%B3%87%E6%BA%90%E9%8F%88%E6%8E%A5) The Trucker Community is China's largest logistics and truck driver community, offering a platform for communication, business, and social interaction via mobile apps, social media, and offline branches, with new initiatives enhancing content creation and welfare - As of June 30, 2025, the Trucker Community had over **3.5 million** registered users, approximately **3.3 million** social media followers, and established offline branches in **298** cities in China[24](index=24&type=chunk) - During the reporting period, the Trucker Community's online platform launched the "Ai Chuang Platform" to empower truck drivers in content creation, resulting in **1,588** video contents and over **19.6 million** views[25](index=25&type=chunk) - The Trucker Community's online platform has integrated with the "Workers' Home" smart service platform of the All-China Federation of Trade Unions, providing labor protection and legal aid services for truck drivers[26](index=26&type=chunk) Trucker Community Operating Metrics (For the six months ended June 30, 2025) | Indicator | Value | | :--- | :--- | | Converted Truck Drivers (thousands) | 182.2 | | Online GTV Completed by Converted Truck Drivers (RMB billions) | 3.7 | | Consignment Orders Completed by Converted Drivers (thousands) | 708.9 | | Percentage of Truck Drivers Converted from Trucker Community to Digital Freight Platform (%) | 22.4 | [Our Ecosystem](index=11&type=section&id=%E6%88%91%E5%80%91%E7%9A%84%E7%94%9F%E6%85%8B%E7%B3%BB%E7%B5%B1) The company has built a sustainable freight ecosystem connecting drivers, shippers, resource providers, and regulators through digital technology, fostering collaboration, data transparency, and shared value growth while empowering social governance - As of H1 2025, **4,801** shippers completed consignment orders on the digital freight platform, with a cumulative total of **17,702**; approximately **3.8 million** truck drivers completed consignment orders, and **3.5 million** drivers were registered with the Trucker Community[43](index=43&type=chunk) - Active truck drivers numbered **241.4 thousand**, completing over **75%** of the total platform sales orders[43](index=43&type=chunk) - Regulatory authorities achieve data-penetrating risk control and compliance supervision by synchronizing all business data from the digital freight platform to regulatory systems[46](index=46&type=chunk) - Industry resource providers, through digital linkage with the company, offer digital products and services such as finance, insurance, energy, and truck aftermarket services to all participants in the digital freight business[46](index=46&type=chunk) [Technology and Social Responsibility](index=13&type=section&id=%E6%8A%80%E8%A1%93%E8%88%87%E7%A4%BE%E6%9C%83%E8%B2%AC%E4%BB%BB) This section highlights the company's advancements in AI technology for road transport and its commitment to corporate social responsibility initiatives [Our Technology and Digital Products](index=13&type=section&id=%E6%88%91%E5%80%91%E7%9A%84%E6%8A%80%E8%A1%93%E5%8F%8A%E6%95%B8%E5%AD%97%E5%8C%96%E7%94%A2%E5%93%81) The company advances AI in road transport, with its AI assistant "Sister Ting" evolving to automate transport processes and actively manage driver tasks, while also developing digital credit solutions for supply chain finance and transparency for shippers and drivers - AI assistant "Sister Ting"'s technical capabilities have strategically evolved from basic semantic interaction to automated transport process services, forming core operational capabilities in task takeover, rule communication, and problem-solving[47](index=47&type=chunk) - The company develops digital credit service solutions, providing supply chain finance support for shippers across core business scenarios and specialized freight finance solutions for truck drivers in transit[48](index=48&type=chunk) - The company offers "transport operation + business data delivery" services to shippers, breaking the "supply chain black box" and enhancing shippers' consignment delivery capabilities[48](index=48&type=chunk) [Corporate Social Responsibility](index=13&type=section&id=%E4%BC%81%E6%A5%AD%E7%A4%BE%E6%9C%83%E8%B2%AC%E4%BB%BB) The company actively fulfills its corporate social responsibility through initiatives like "Aid for Tibetan Truck Drivers," the "Love Mileage Donation" platform, and partner care projects, providing comprehensive support to drivers, and deepening strategic collaboration with the All-China Federation of Trade Unions for specific rights - Following the Dingri County earthquake in Tibet, the company swiftly launched the "Aid for Tibetan Truck Drivers" initiative, providing supplies and 24-hour hotline services to ensure the smooth flow of the transport lifeline[49](index=49&type=chunk) - The "Love Mileage Donation" public welfare platform has accumulated approximately **600,000** participating drivers, donated **4.3 billion** kilometers, benefiting **3,579** driver families, and specifically helping **40** families reunite[50](index=50&type=chunk) - In collaboration with FAW Jiefang and the China Staff Development Foundation, the "Jiefang Love Navigator • Care for Truck Drivers" project has completed two phases, assisting **315** families with a total of **RMB 1.836 million** in donations[51](index=51&type=chunk) - In H1 2025, the company deepened strategic collaboration with the All-China Federation of Trade Unions, securing **43,000** specific rights for member truck drivers, with a total value exceeding **RMB 2.27 million**[52](index=52&type=chunk) [Strategy and Milestones](index=14&type=section&id=%E6%88%B0%E7%95%A5%E8%88%87%E9%87%8C%E7%A8%8B%E7%A2%BC) This section outlines the company's strategic achievements during the reporting period and its future outlook [Our Milestones in H1 2025](index=14&type=section&id=%E6%88%91%E5%80%91%E6%96%BC2025%E5%B9%B4%E4%B8%8A%E5%8D%8A%E5%B9%B4%E7%9A%84%E9%87%8C%E7%A8%8B%E7%A2%BC) In H1 2025, the company successfully held the 11th "May 2nd Trucker Festival," achieved deep coverage of all logistics projects with AI assistant "Sister Ting," and launched first-hand data services for shippers, enhancing operational efficiency and data value - Successfully held the 11th "May 2nd Trucker Festival" with the theme "From Wheels to AI, Your Voice Needs to Be Heard," empowering truck drivers to voice their opinions through AI technology[53](index=53&type=chunk) - AI assistant "Sister Ting" fully participates in logistics project truck driver operations management, upgrading interaction from menu function lookup to proactive AI response[54](index=54&type=chunk) - Launched data services based on first-hand data for logistics enterprises and other shippers, providing analysis and applications in project management, cost management, capacity operation, and risk management[54](index=54&type=chunk) [Outlook](index=15&type=section&id=%E5%B1%95%E6%9C%9B) The company plans to advance AI, with "Sister Ting" fully managing transport scenarios, expand data services for data-driven business model upgrades, and capitalize on standardized tax regulation in digital freight to accelerate inefficient capacity exit and gain development benefits - AI assistant "Sister Ting" will fully take over transport management scenarios, acting as an intelligent work assistant for shippers, catalyzing three revolutionary industry changes: transparent capacity matching, disintermediated dispatch decisions, and flattened freight power structures[55](index=55&type=chunk) - The company will leverage first-hand data to continuously enrich data service projects, facilitating a data-driven and digitalized business model upgrade[55](index=55&type=chunk) - State Council Decree No. 810 (2025) marks a new phase of standardized tax regulation in the digital freight industry, which will raise compliance thresholds, accelerate the exit of inefficient capacity, and benefit enterprises with full-link digitalization capabilities[56](index=56&type=chunk) [Financial Review](index=16&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section provides a detailed analysis of the company's financial performance, liquidity, and capital structure during the reporting period [Consolidated Income Statement Analysis](index=16&type=section&id=%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%88%86%E6%9E%90) Total revenue decreased by 7.0% YoY due to lower freight service volume, but gross profit and margin significantly improved by selecting high-value clients and promoting high-margin data services, leading to increased profit for the period and adjusted net profit [Revenue](index=16&type=section&id=%E6%94%B6%E5%85%A5) Total revenue decreased by 7.0% to **RMB 3,030.2 million**, mainly due to lower freight service volume, while freight platform service revenue grew by **33.7%** Revenue Details (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | % of Total Revenue (2025) | % of Total Revenue (2024) | | :--- | :--- | :--- | :--- | :--- | :--- | | Freight Service Revenue | 2,825,976 | 3,094,506 | -8.7 | 93.26 | 95.01 | | Freight Platform Service Revenue | 197,871 | 148,037 | +33.7 | 6.53 | 4.54 | | Sales of Goods | 147 | 273 | -46.2 | 0.01 | 0.01 | | Others | 6,156 | 14,348 | -57.1 | 0.20 | 0.44 | | Total | 3,030,150 | 3,257,164 | -7.0 | 100.00 | 100.00 | [Cost of Revenue](index=17&type=section&id=%E7%87%9F%E6%A5%AD%E6%88%90%E6%9C%AC) Cost of revenue decreased by 8.3% to **RMB 2,828.5 million**, primarily due to reduced driver freight costs from lower freight service volume Cost of Revenue (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Cost of Revenue | 2,828.5 | 3,083.0 | -8.3 | [Gross Profit and Gross Margin](index=17&type=section&id=%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) Gross profit increased by 15.7% to **RMB 201.6 million**, with gross margin rising from **5.35%** to **6.65%**, driven by selecting high-value digital cooperation clients and promoting high-margin data services Gross Profit and Gross Margin (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 201.6 | 174.2 | +15.7 | | Gross Margin | 6.65% | 5.35% | +1.30pp | [Other Income and Gains](index=17&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E5%8F%8A%E6%94%B6%E7%9B%8A) Other income and gains increased by 46.8% to **RMB 11.6 million**, mainly due to higher government grants (excluding those related to digital freight business) Other Income and Gains (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Other Income and Gains | 11.6 | 7.9 | +46.8 | | Of which: Government Grants | 6.6 | 1.2 | +450.0 | [Selling Expenses](index=17&type=section&id=%E9%8A%B7%E5%94%AE%E8%B2%BB%E7%94%A8) Selling expenses decreased by 13.7% to **RMB 37.3 million**, primarily due to reduced staff costs and travel expenses from fewer employees, and lower share-based payments Selling Expenses (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Selling Expenses | 37.3 | 43.2 | -13.7 | [Administrative Expenses](index=18&type=section&id=%E7%AE%A1%E7%90%86%E8%B2%BB%E7%94%A8) Administrative expenses decreased by 3.5% to **RMB 44.2 million**, mainly due to lower share-based payments Administrative Expenses (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 44.2 | 45.8 | -3.5 | [Research and Development Expenses](index=18&type=section&id=%E7%A0%94%E7%99%BC%E9%96%8B%E6%94%AF) R&D expenses increased by 16.4% to **RMB 45.4 million**, primarily due to higher staff costs from an increase in R&D personnel Research and Development Expenses (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | R&D Expenses | 45.4 | 39.0 | +16.4 | [Net Impairment Losses on Financial and Contract Assets](index=18&type=section&id=%E9%87%91%E8%9E%8D%E5%8F%8A%E5%90%88%E5%90%8C%E8%B3%87%E7%94%A2%E6%B8%9B%E5%80%BC%E6%B7%A8%E5%80%BC) Impairment losses on financial and contract assets increased from **RMB 6.5 million** to **RMB 12.1 million**, mainly due to impairment losses on trade receivables from customer credit deterioration Net Impairment Losses on Financial and Contract Assets (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Impairment Losses | 12.1 | 6.5 | +86.2 | [Other Expenses](index=18&type=section&id=%E5%85%B6%E4%BB%96%E9%96%8B%E6%94%AF) Other expenses increased by 13.0% to **RMB 20.8 million**, primarily due to higher taxes and surcharges Other Expenses (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Other Expenses | 20.8 | 18.4 | +13.0 | [Finance Costs](index=18&type=section&id=%E8%B2%A1%E5%8B%99%E6%88%90%E6%9C%AC) Finance costs increased by 28.9% to **RMB 4.9 million**, mainly due to higher bill discount charges during the reporting period Finance Costs (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Finance Costs | 4.9 | 3.8 | +28.9 | [Income Tax Expense](index=18&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income tax expense significantly increased from **RMB 3.4 million** to **RMB 22.3 million**, primarily due to higher taxable profit during the reporting period Income Tax Expense (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Income Tax Expense | 22.3 | 3.4 | +555.9 | [Profit for the Period](index=19&type=section&id=%E6%9C%9F%E5%85%A7%E5%88%A9%E6%BD%A4) Profit attributable to owners of the parent increased by 16.54% to **RMB 28.0 million** Profit Attributable to Owners of the Parent (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Profit Attributable to Owners of the Parent | 28.0 | 24.0 | +16.54 | [Adjusted Net Profit (Non-IFRS)](index=19&type=section&id=%E7%B6%93%E8%AA%BF%E6%95%B4%E6%B7%A8%E5%88%A9%E6%BD%A4) Adjusted net profit (non-IFRS) increased by 7.04% to **RMB 26.8 million**, primarily due to improved gross margin from selecting high-value digital cooperation clients Adjusted Net Profit (Non-IFRS) (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Adjusted Net Profit | 26.8 | 25.0 | +7.04 | | Adjusted Net Profit Attributable to Owners of the Parent | 28.7 | 27.2 | +5.40 | [Liquidity and Capital Structure](index=20&type=section&id=%E6%B5%81%E5%8B%95%E6%80%A7%E8%88%87%E8%B3%87%E6%9C%AC%E7%B5%90%E6%A7%8B) Both current assets and liabilities decreased, but the current ratio improved from 1.30 to 1.44, indicating better liquidity, while interest-bearing borrowings and the gearing ratio significantly decreased, with no major external capital requirements or foreign exchange risks [Current Assets and Liabilities](index=20&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E7%94%A2%E8%88%87%E8%B2%A0%E5%82%B5) As of June 30, 2025, current assets decreased by 18.8% to **RMB 2,118.8 million**, current liabilities decreased by 26.4% to **RMB 1,476.3 million**, and the current ratio improved from **1.30** to **1.44**, indicating improved liquidity Liquidity Indicators (As of June 30, 2025) | Indicator | June 30, 2025 (RMB millions) | December 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Current Assets | 2,118.8 | 2,610.1 | -18.8 | | Current Liabilities | 1,476.3 | 2,006.5 | -26.4 | | Current Ratio | 1.44 | 1.30 | +10.8% | [Capital Expenditure and Asset Pledges](index=21&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF%E8%88%87%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) Capital expenditure for the period was approximately **RMB 0.9 million**, mainly for property, plant, and equipment and intangible assets, funded primarily by operating cash flow, with no assets pledged as of June 30, 2025 - Capital expenditure for the reporting period was approximately **RMB 0.9 million**, primarily for the purchase of property, plant, and equipment and intangible assets[78](index=78&type=chunk) - As of June 30, 2025, the Group had not pledged any assets as collateral for bank borrowings or any other financing activities[79](index=79&type=chunk) [Borrowings and Gearing Ratio](index=21&type=section&id=%E5%80%9F%E6%AC%BE%E8%88%87%E8%B3%87%E6%9C%AC%E8%B2%A0%E5%82%B5%E6%AF%94%E7%8E%87) As of June 30, 2025, interest-bearing bank and other borrowings decreased to **RMB 197.3 million**, and the gearing ratio fell from **44.6%** to **29.8%**, indicating reduced financial leverage Borrowings and Gearing Ratio (As of June 30, 2025) | Indicator | June 30, 2025 (RMB millions) | December 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Interest-bearing Bank and Other Borrowings | 197.3 | 290.7 | -32.1 | | Gearing Ratio | 29.8% | 44.6% | -14.8pp | [Exchange Rate Fluctuation Risk](index=22&type=section&id=%E5%BD%99%E7%8E%87%E6%B3%A2%E5%8B%95%E9%A2%A8%E9%9A%AA) The company's operations are primarily in China, with most transactions settled in RMB, posing no significant foreign exchange risk, and no derivative or hedging activities were undertaken during the period - The Group's business operations are primarily conducted in China, with most transactions settled in RMB, posing no significant foreign exchange risk[84](index=84&type=chunk) - During the reporting period, the Group did not engage in any derivative activities or hedging activities for foreign exchange risk[84](index=84&type=chunk) [Material Transactions and Future Plans](index=21&type=section&id=%E9%87%8D%E5%A4%A7%E4%BA%A4%E6%98%93%E8%88%87%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) The company did not undertake any material acquisitions or disposals of subsidiaries, associates, or joint ventures, nor does it have other significant future plans for investments and capital assets during the reporting period [Material Acquisitions and Disposals of Subsidiaries, Associates, and Joint Ventures](index=21&type=section&id=%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E3%80%81%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%90%88%E7%87%9F%E4%BC%81%E6%A5%AD%E7%9A%84%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE) For the six months ended June 30, 2025, the company did not make any material acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the Group did not make any material acquisitions or disposals of subsidiaries, associates, and joint ventures[82](index=82&type=chunk) [Future Plans for Material Investments and Capital Assets](index=21&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E5%92%8C%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E4%B9%8B%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) Except as disclosed in this announcement, as of June 30, 2025, the company has no future plans for material investments and capital assets - Except as disclosed in this announcement, as of June 30, 2025, the Group has no plans for material investments and capital assets[83](index=83&type=chunk) [Corporate Governance and Others](index=23&type=section&id=%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E8%88%87%E5%85%B6%E4%BB%96) This section covers significant corporate events, employee policies, use of proceeds, and adherence to corporate governance standards [Material Events During the Reporting Period](index=23&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%85%A7%E9%87%8D%E5%A4%A7%E4%BA%8B%E4%BB%B6) During the reporting period, Mr. Fu Da resigned as non-executive director, the Nomination Committee composition changed, Mr. Long Ke was appointed executive director, amendments to the Articles of Association were approved, and the principal place of business in Hong Kong changed - Mr. Fu Da, a non-executive director, resigned, effective March 28, 2025[87](index=87&type=chunk) - Ms. Wang Yao, a non-executive director, and Mr. Li Dong, an independent non-executive director, were appointed as members of the Nomination Committee, effective March 28, 2025[88](index=88&type=chunk) - Mr. Long Ke was appointed as an executive director of the Fifth Board of Directors, effective June 10, 2025[89](index=89&type=chunk) - Amendments to the Articles of Association were approved at the annual general meeting and class meetings held on June 10, 2025, and became effective on the same day[90](index=90&type=chunk) - The company's principal place of business in Hong Kong changed effective January 10, 2025[91](index=91&type=chunk) [Material Events After the Reporting Period](index=24&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E9%87%8D%E5%A4%A7%E4%BA%8B%E4%BB%B6) Except as disclosed, as of the announcement date, the company is unaware of any material post-reporting period events that could significantly impact its operations and financial performance - Except as disclosed in this announcement, the Group is not aware of any material events that could significantly impact our operations and financial performance for the period from June 30, 2025, to the date of this announcement[92](index=92&type=chunk) [Employees and Remuneration Policy](index=24&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the company had 859 full-time employees in China, offering competitive remuneration including base salary, performance bonuses, social security, and commercial insurance, alongside equity incentive plans and customized training to attract and motivate talent - As of June 30, 2025, the company had **859** full-time employees, all located in China[93](index=93&type=chunk) - Remuneration typically includes base salary and performance bonuses, with benefits such as pension plans and medical insurance, and an equity incentive plan[93](index=93&type=chunk) - The company provides tailored online and offline training courses based on the needs of employees in different functions, covering corporate culture, internal rules, professional knowledge, and leadership skills[94](index=94&type=chunk) [Use of Proceeds](index=25&type=section&id=%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E7%94%A8%E9%80%94) The net proceeds from the global offering were approximately **HKD 63.1 million**, with about **HKD 29.9 million (47.4%)** utilized as of June 30, 2025, consistent with the prospectus, with no intention to change the planned uses - The net proceeds from the global offering (after deducting underwriting commissions and related costs and expenses) were approximately **HKD 63.1 million**[95](index=95&type=chunk) - As of June 30, 2025, the company had utilized approximately **HKD 29.9 million** of the net proceeds from the global offering for the intended purposes as stated in the prospectus, accounting for approximately **47.4%** of the total[95](index=95&type=chunk) - The company has no intention to change the use of proceeds from the global offering as stated in the prospectus and will gradually apply the net proceeds to the intended uses[99](index=99&type=chunk) Details of Use of Net Proceeds from Global Offering (As of June 30, 2025) | Use | Allocation in Prospectus (%) | Estimated Net Proceeds in Prospectus (HKD millions) | Allocated Net Proceeds from Global Offering (HKD millions) | Utilized as of December 31, 2024 (HKD millions) | Utilized for the six months ended June 30, 2025 (HKD millions) | Unutilized as of June 30, 2025 (HKD millions) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Further upgrade and strengthen digital freight business | 45.0% | 34.2 | 28.4 | 5.8 | 2.5 | 20.1 | | (i) Acquire more freight service and freight platform service customers | 15.0% | 11.4 | 9.5 | 1.6 | 0.8 | 7.1 | | (ii) Increase penetration among existing customer base | 15.0% | 11.4 | 9.5 | 3.1 | 1.0 | 5.4 | | (iii) Enhance participation of other ecosystem participants | 15.0% | 11.4 | 9.4 | 1.1 | 0.7 | 7.6 | | Further expand Trucker Community and Kaja Car Services | 15.0% | 11.4 | 9.5 | 2.3 | 1.1 | 6.1 | | Explore and enhance commercialization of Trucker Community | 7.5% | 5.7 | 4.7 | 0.9 | 0.6 | 3.2 | | Establish and maintain Kaja Car Services authorized store network | 5.0% | 3.8 | 3.2 | 0.7 | 0.3 | 2.2 | | Strengthen Kaja Car Services supply chain system | 2.5% | 1.9 | 1.6 | 0.7 | 0.2 | 0.7 | | Enhance R&D efforts and strengthen technological capabilities | 20.0% | 15.2 | 12.6 | 9.8 | 1.4 | 1.4 | | Strengthen technological advantages in big data | 15.0% | 11.4 | 9.4 | 6.6 | 1.4 | 1.4 | | Improve existing R&D capabilities in high-tech fields | 5.0% | 3.8 | 3.2 | 3.2 | 0.0 | 0.0 | | Recruit additional sales, marketing, and operations personnel | 10.0% | 7.6 | 6.3 | 3.0 | 0.8 | 2.5 | | Working capital and other general corporate purposes | 10.0% | 7.6 | 6.3 | 2.5 | 0.7 | 3.1 | [Interim Dividend](index=27&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board of Directors resolved not to recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board of Directors resolved not to recommend the payment of an interim dividend for the six months ended June 30, 2025[100](index=100&type=chunk) [Corporate Governance](index=47&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The company maintains high corporate governance standards, complying with the CG Code and Model Code, with a highly independent Board, and no material litigation, arbitration, or claims during the reporting period - The company has adopted and complied with all principles and applicable code provisions under Part 2 of the Corporate Governance Code throughout the reporting period[155](index=155&type=chunk) - The Board currently comprises four executive directors, two non-executive directors, and three independent non-executive directors, demonstrating a high degree of independence[155](index=155&type=chunk) - Directors and supervisors have complied with the required standards for securities transactions as set out in the Model Code throughout the reporting period[157](index=157&type=chunk) - During the reporting period, no member of the Group was involved in any material litigation, arbitration, or claims[159](index=159&type=chunk) [Audit Committee](index=48&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, composed of three independent non-executive directors, reviewed and confirmed the unaudited interim consolidated results for the six months ended June 30, 2025, finding them compliant with accounting standards and regulations, with appropriate disclosures - The Audit Committee comprises three independent non-executive directors: Mr. Li Dong (Chairman), Mr. Liu Xiaofeng, and Mr. Dai Dingyi[160](index=160&type=chunk) - The Audit Committee reviewed the interim consolidated results, found no disagreement with management, and confirmed compliance with applicable accounting principles, standards, and requirements, with sufficient disclosures[160](index=160&type=chunk) [Definitions](index=48&type=section&id=%E9%87%8B%E7%BE%A9) This section provides definitions for key terms and abbreviations used in the report, ensuring accuracy and consistency in understanding information related to the company, business, finance, and governance

[Financial Summary](index=1&type=section&id=Financial%20Summary) The company's revenue significantly decreased by 81.9% to Thousand RMB 9,863, while loss before tax narrowed by 75.2% to Thousand RMB (4,743) for the six months ended June 30, 2025 | Metric | Six Months Ended June 30, 2025 (Thousand RMB) | Six Months Ended June 30, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Revenue | 9,863 | 54,511 | (81.9%) | | Other Income | 2,298 | 1,306 | 76.0% | | Loss Before Tax | (4,743) | (19,144) | (75.2%) | | Loss for the Period | (6,604) | (22,063) | (70.1%) | | Total Comprehensive Loss for the Period | (4,188) | (20,803) | (79.9%) | | Basic Loss Per Share (RMB) | (0.00) | (0.02) | (100.0%) | **Statement of Financial Position (Period End):** | Metric | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Total Assets | 559,913 | 558,737 | 0.2% | | Total Equity | 283,769 | 237,724 | 19.4% | [Interim Results Announcement](index=1&type=section&id=Interim%20Results%20Announcement) The Board of Directors is pleased to announce the condensed consolidated financial statements for the six months ended June 30, 2025, with comparative figures for the same period in 2024 - The Board of Directors is pleased to announce the condensed consolidated financial statements for the six months ended June 30, 2025, and provides comparative data for the same period in 2024[4](index=4&type=chunk) [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the condensed consolidated financial statements, including the statement of profit or loss, statement of profit or loss and other comprehensive income, and statement of financial position [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2025, the Group's revenue significantly decreased by 81.9% to Thousand RMB 9,863, while loss for the period narrowed by 70.1% to Thousand RMB 6,604, primarily due to impairment and provisions credited | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Net Revenue | 9,863 | 54,511 | (81.9%) | | Other Income | 2,298 | 1,306 | 76.0% | | Impairment and Provisions Credited | 12,007 | 6,278 | 91.3% | | Impairment Loss on Property, Plant and Equipment | – | (15,613) | (100.0%) | | Operating Expenses | (17,505) | (20,739) | (15.7%) | | Loss Before Tax | (4,743) | (19,144) | (75.2%) | | Loss for the Period | (6,604) | (22,063) | (70.1%) | - Loss attributable to owners of the Company significantly decreased from **Thousand RMB 9,630 in 2024** to **Thousand RMB 894 in 2025**[5](index=5&type=chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The Group's total comprehensive loss for the six months ended June 30, 2025, significantly narrowed by 79.9% to Thousand RMB 4,188, mainly due to a reduction in loss for the period and increased other comprehensive income from currency translation of the Company's financial statements | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Loss for the Period | (6,604) | (22,063) | (70.1%) | | Currency Translation of the Company's Financial Statements | 9,700 | 3,451 | 181.1% | | Exchange Differences on Translation of Foreign Operations | (7,284) | (2,191) | 232.5% | | Total Comprehensive Loss for the Period | (4,188) | (20,803) | (79.9%) | - Total comprehensive loss attributable to owners of the Company turned from **Thousand RMB (8,370) in 2024** to a **comprehensive income of Thousand RMB 1,522 in 2025**[6](index=6&type=chunk) [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 slightly increased by 0.2% to Thousand RMB 559,913, while total equity significantly grew by 19.4% to Thousand RMB 283,769, primarily driven by an increase in share capital and reserves | Metric | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Total Assets | 559,913 | 558,737 | 0.2% | | Cash and Bank Balances | 224,222 | 185,561 | 20.8% | | Pledged Bank Deposits | 5,194 | 33,009 | (84.3%) | | Total Liabilities | 276,144 | 321,013 | (14.0%) | | Total Equity | 283,769 | 237,724 | 19.4% | | Share Capital | 5,129 | 4,421 | 16.0% | | Reserves | 334,383 | 283,336 | 18.0% | - Guaranteed liabilities and interest-bearing borrowings both showed significant decreases, reducing by **62.2%** and **15.8%** respectively[7](index=7&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=5&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section details the principal accounting policies, revenue and segment reporting, other income, loss before tax, income tax, loss per share, and various receivables and borrowings [Principal Accounting Policies](index=5&type=section&id=Principal%20Accounting%20Policies) This interim financial report is prepared under the historical cost convention, consistent with the 2024 annual financial statements, with no significant impact from new/revised HKFRSs effective January 1, 2025 - The condensed interim financial report is prepared under the historical cost convention, with certain assets measured at fair value[8](index=8&type=chunk) - The adoption of new/revised Hong Kong Financial Reporting Standards (such as amendments to HKAS 21) has no significant impact on the Group's condensed interim financial report[9](index=9&type=chunk) [Revenue and Segment Reporting](index=5&type=section&id=Revenue%20and%20Segment%20Reporting) The Group's total revenue significantly decreased by 81.9% to Thousand RMB 9,863, primarily due to reduced energy storage and online finance guarantee income, despite growth in consultancy fees and a shift to breeding services in the market hogs segment [Revenue](index=5&type=section&id=Revenue%20(Segment%20Reporting)) The Group's total revenue significantly decreased, primarily dragged down by online finance guarantee income and energy storage system sales, while consultancy and maintenance service fees and breeding service income achieved growth | Revenue Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Net Guarantee Fee Income | 1,078 | 14,131 | (92.4%) | | Consultancy and Maintenance Service Fees | 5,088 | 118 | 4211.9% | | Finance Lease Income | 453 | 647 | (30.0%) | | Sale of Market Hogs | – | 4,362 | (100.0%) | | Breeding Service Income | 3,244 | – | N/A | | Sale of Energy Storage Systems | – | 35,253 | (100.0%) | | **Net Revenue** | **9,863** | **54,511** | **(81.9%)** | [Segment Reporting](index=6&type=section&id=Segment%20Reporting) The Group's operations are divided into Financial Services, Market Hogs, and Energy Storage segments, with Financial Services showing increased profit before tax, while both Market Hogs and Energy Storage segments recorded losses, the latter significantly due to no revenue - The Group's operating segments include financial services (guarantee, factoring, finance lease, consultancy and maintenance), market hogs (sales and breeding services), and energy storage (overseas energy storage system trading)[13](index=13&type=chunk) **Segment Profit (Loss) Before Tax** | Segment | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Financial Services | 7,070 | 6,351 | 11.3% | | Market Hogs | (8,696) | (25,409) | (65.8%) | | Energy Storage | (3,117) | (86) | 3524.4% | | **Total** | **(4,743)** | **(19,144)** | **(75.2%)** | - Revenue from the Financial Services segment decreased from **Thousand RMB 14,896** to **Thousand RMB 6,619**, but profit before tax increased significantly due to a substantial rise in impairment and provisions credited[14](index=14&type=chunk) - The Market Hogs segment shifted from a sales model to a breeding service model, recording **Thousand RMB 3,244** in breeding service income in 2025, but still incurred a loss due to higher costs[14](index=14&type=chunk) - The Energy Storage segment had no revenue in 2025, leading to a significant increase in loss before tax from **Thousand RMB 86** to **Thousand RMB 3,117**[14](index=14&type=chunk) [Geographical Information](index=8&type=section&id=Geographical%20Information) In the first half of 2025, all of the Group's revenue originated from Mainland China, a significant shift from the same period in 2024 when a substantial portion came from energy storage business in South Africa, indicating a major change in business geographical distribution **Revenue by Geographical Location of Customers** | Region | 2025 (Thousand RMB) | 2024 (Thousand RMB) | | :--- | :--- | :--- | | Mainland China | 9,863 | 19,258 | | South Africa | – | 35,253 | | **Total** | **9,863** | **54,511** | - Non-current assets are primarily located in Mainland China, amounting to **Thousand RMB 167,663** as of June 30, 2025, and **Thousand RMB 438** in Hong Kong[16](index=16&type=chunk) [Other Income](index=9&type=section&id=Other%20Income%20(Notes)) The Group's other income increased by 76.0% year-on-year to Thousand RMB 2,298, primarily driven by the recovery of bad debts | Income Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Bank Deposit Interest Income | 1,063 | 1,091 | (2.6%) | | Recovery of Bad Debts | 818 | – | N/A | | Others | 417 | 204 | 104.4% | | **Total** | **2,298** | **1,306** | **76.0%** | [Loss Before Tax](index=9&type=section&id=Loss%20Before%20Tax%20(Notes)) The Group's loss before tax significantly narrowed by 75.2% year-on-year to Thousand RMB 4,743, mainly due to increased impairment and provisions credited, and a reduction in impairment loss on property, plant and equipment **Items (Credited) Debited to Loss Before Tax** | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | | :--- | :--- | :--- | | Impairment and Provisions Credited | (12,007) | (6,278) | | Staff Costs | 7,379 | 8,253 | | Depreciation Expense | 6,151 | 6,272 | | Net Exchange Loss | 2,567 | 851 | | Interest Expense | 3,797 | 5,410 | - Provisions credited for guarantees issued increased from **Thousand RMB (4,848) in 2024** to **Thousand RMB (11,012) in 2025**[19](index=19&type=chunk) - Staff costs decreased by **10.6%** year-on-year, and interest expense decreased by **29.9%** year-on-year[19](index=19&type=chunk)[20](index=20&type=chunk) [Income Tax](index=10&type=section&id=Income%20Tax%20(Notes)) The Group's income tax expense decreased by 34.5% year-on-year to Thousand RMB 1,861, primarily due to the reversal of deferred tax assets | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Deferred Tax | (1,861) | (2,919) | (36.2%) | | Income Tax Expense | (1,861) | (2,919) | (34.5%) | [Loss Per Share](index=10&type=section&id=Loss%20Per%20Share) The Group's basic loss per share decreased from RMB 0.02 in 2024 to RMB 0.00 in 2025, mainly due to a significant reduction in loss attributable to owners of the Company | Metric | 2025 (RMB) | 2024 (RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Basic Loss Per Share | (0.00) | (0.02) | (100.0%) | - Basic loss per share is calculated based on the loss attributable to owners of the Company of **Thousand RMB 894** (2024: Thousand RMB 9,630) and a weighted average number of shares of **566,443 thousand shares** (2024: 552,307 thousand shares)[22](index=22&type=chunk) [Trade and Other Receivables](index=11&type=section&id=Trade%20and%20Other%20Receivables) The Group's total trade and other receivables decreased by 14.4% year-on-year to Thousand RMB 74,987, primarily due to a reduction in prepayments for construction works and prepayments to former non-controlling interests of a subsidiary, both net of loss allowance | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Trade Receivables (Net of Loss Allowance) | 18,439 | 18,234 | 1.1% | | Deposits and Other Receivables (Net of Loss Allowance) | 39,447 | 40,645 | (2.9%) | | Prepayments for Construction Works (Net of Loss Allowance) | 7,696 | 18,742 | (58.9%) | | Prepayments to Former Non-Controlling Interests of a Subsidiary | 3,643 | 4,626 | (21.3%) | | **Total** | **74,987** | **87,592** | **(14.4%)** | - The aging analysis of trade receivables shows that amounts over one year account for the largest portion, at **Thousand RMB 130,051**[24](index=24&type=chunk) [Factoring Receivables](index=12&type=section&id=Factoring%20Receivables) The carrying amount of the Group's factoring receivables slightly decreased by 1.7% to Thousand RMB 11,567, with most of it being overdue | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Carrying Amount of Factoring Receivables | 11,567 | 11,769 | (1.7%) | | Loss Allowance for Factoring Receivables | (40,024) | (40,221) | (0.5%) | - As of June 30, 2025, **Thousand RMB 44,215** of factoring receivables were contractually overdue, remaining consistent with the end of last year[26](index=26&type=chunk) [Finance Lease Receivables](index=13&type=section&id=Finance%20Lease%20Receivables) The carrying amount of the Group's finance lease receivables slightly increased by 1.5% to Thousand RMB 31,329, with the non-overdue portion remaining stable | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Carrying Amount of Finance Lease Receivables | 31,329 | 30,859 | 1.5% | | Loss Allowance for Finance Lease Receivables | (144,527) | (146,067) | (1.1%) | - Non-overdue finance lease receivables amounted to **Thousand RMB 16,000**, consistent with the end of last year[28](index=28&type=chunk) [Changes in Property, Plant and Equipment](index=14&type=section&id=Changes%20in%20Property%2C%20Plant%20and%20Equipment) The Group saw an increase in property, plant and equipment additions and a reclassification of prepayments for construction works to property, plant and equipment, with no impairment loss recognized this period, contrasting with a significant impairment loss recognized in the prior period - The cost of property, plant and equipment acquired this period was **Thousand RMB 95** (2024: Thousand RMB 58)[29](index=29&type=chunk) - **Thousand RMB 11,046** of prepayments for construction works were reclassified to property, plant and equipment (2024: nil)[29](index=29&type=chunk) - No impairment loss on property, plant and equipment was recognized this period (2024: Thousand RMB 15,613)[29](index=29&type=chunk) [Interest-Bearing Borrowings](index=14&type=section&id=Interest-Bearing%20Borrowings) The Group's total interest-bearing borrowings decreased by 15.8% year-on-year to Thousand RMB 120,662, primarily due to a reduction in unsecured other borrowings, with loans from the controlling shareholder fully settled | Borrowing Category | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Secured Bank Borrowings | 118,069 | 125,649 | (6.0%) | | Unsecured Other Borrowings | 2,593 | 17,550 | (85.2%) | | **Total** | **120,662** | **143,199** | **(15.8%)** | - Loans from the controlling shareholder, Expert Depot Limited, were **fully settled** during this period, decreasing from **Thousand RMB 15,280** to zero[30](index=30&type=chunk)[32](index=32&type=chunk) - Bank borrowings are primarily secured by ordinary shares of subsidiaries, prepayments for construction works, and property, plant and equipment[30](index=30&type=chunk) [Dividends](index=15&type=section&id=Dividends%20(Notes)) For the six months ended June 30, 2025, the Company did not declare an interim dividend, consistent with the prior period - No interim dividend was declared for the current period or the prior period[33](index=33&type=chunk) [Management Discussion and Analysis](index=16&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the Group's performance, industry and business review, financial review, liquidity and capital resources, and future prospects and outlook [Overview](index=16&type=section&id=Overview) In the first half of 2025, the global economic recovery remained weak, and Mainland China's economy saw a slow recovery but lacked sufficient effective demand; in this complex environment, the Group adhered to prudent principles, developing traditional businesses, adjusting supply chain finance, and exploring new areas for stable growth - The global economy is experiencing a difficult recovery with "weak resilience," facing challenges such as sluggish external demand, trade protectionism, and geopolitical conflicts[34](index=34&type=chunk) - Mainland China's GDP grew by **5.3%** year-on-year, with a slow economic recovery, but effective demand remains insufficient, and private fixed asset investment decreased by **0.6%** year-on-year[34](index=34&type=chunk)[35](index=35&type=chunk) - The Group is responding to the complex and severe external environment by prudently developing traditional businesses, adjusting integrated supply chain financial services, and exploring new sector opportunities[35](index=35&type=chunk) [Industry and Business Review](index=16&type=section&id=Industry%20and%20Business%20Review) The Group maintained prudent financial services, expanded electronic bidding guarantees, shifted hog breeding to a service model, addressed international energy storage challenges by exploring new markets, and ventured into digital assets via exchangeable bonds [Prudent and Stable Development of Traditional Businesses](index=16&type=section&id=Prudent%20and%20Stable%20Development%20of%20Traditional%20Businesses) The Group's financial segment prioritized risk control, expanded FinTech, launched electronic bidding guarantees, and adjusted finance lease strategies, despite lower-than-expected guarantee income due to market conditions - Mainland China's government implemented proactive fiscal and moderately loose monetary policies, but small and medium-sized enterprises still face operational pressure and slow growth in financing demand[36](index=36&type=chunk) - The financial segment continued its prudent strategy, optimizing risk management, deepening FinTech deployment, and enhancing competitiveness through diversified cooperation[37](index=37&type=chunk) - Guarantee business income was below expectations due to slow growth in financing demand from small and medium-sized enterprises and increased fee sensitivity during the economic recovery phase[37](index=37&type=chunk) - New electronic bidding guarantee services were launched, utilizing blockchain technology to provide small-amount, dispersed, and controllable electronic bidding guarantee services, with increased income expected in the second half of the year[38](index=38&type=chunk) - Cooperation with regional commercial banks is progressing to launch specialized finance guarantee products for agricultural trading markets[39](index=39&type=chunk) - During the reporting period, the Group experienced no customer defaults on borrowings or payment obligations, and recovered approximately **RMB 820,000** in accounts receivable[39](index=39&type=chunk) - The finance lease industry faces stricter regulation and market competition, prompting the Group to adjust its operating strategy, prudently select businesses, and strengthen risk prevention and control[40](index=40&type=chunk) [Implementation of Hog Breeding Services](index=18&type=section&id=Implementation%20of%20Hog%20Breeding%20Services) The Group continues to focus on the hog breeding service model, collaborating with state-owned enterprises, with the first round of services completed and the second round initiated, expecting increased revenue; this model mitigates market price fluctuation risks, but the segment still recorded a loss due to depreciation and operating expenses - Mainland China's hog breeding industry policy focuses on capacity regulation and disease prevention, with intense pig price fluctuations and accelerated scaling up of breeding enterprises[41](index=41&type=chunk) - The Group provides specialized breeding services to high-quality hog breeding enterprises, with the first round of cooperation completed and the second round of breeding services initiated, expecting the number of hogs to increase to approximately **29,000 head**[42](index=42&type=chunk) - The breeding service model mitigates market price fluctuation uncertainties and reduces operating risks, but the market hogs segment still recorded a loss due to significant depreciation costs, operating expenses, and finance costs[43](index=43&type=chunk) [Obstacles in International Energy Storage Supply Chain Business](index=19&type=section&id=Obstacles%20in%20International%20Energy%20Storage%20Supply%20Chain%20Business) The Group's international energy storage business recorded no revenue during the reporting period, primarily due to intense competition in the South African market and no new orders; the company is seeking new distributors and actively developing markets in Australia, Northern Europe, and the UK, having secured some orders and prepayments - The international energy storage business faces challenges such as intensified industry competition, new trade barriers, fierce price wars, and more[44](index=44&type=chunk) - No revenue was recorded from energy storage system sales during the reporting period, mainly due to intense competition in the South African market and no new sales orders with distributors[44](index=44&type=chunk) - Other high-quality local distributors have been identified in South Africa, with preliminary cooperation intentions reached, and sales of goods are expected to resume in the second half of the year[44](index=44&type=chunk) - Actively developing markets in Australia, Northern Europe, and the UK; certification applications are underway in Australia, relevant product orders and partial prepayments have been secured in the UK, and sales distributors have been identified in Northern Europe[45](index=45&type=chunk) - An experienced operations team has been assembled to enhance R&D capabilities and improve sales potential[45](index=45&type=chunk) [Venturing into Digital Asset Sector](index=20&type=section&id=Venturing%20into%20Digital%20Asset%20Sector%20(Industry%20Review)) The Group ventured into the digital asset sector by subscribing to exchangeable bonds, with the target company registered in Oman and aiming to become Oman's first cryptocurrency OTC and exchange platform, intending to diversify its investment portfolio and explore the potential of emerging finance - The digital asset sector, as a key direction for global financial transformation, has significant growth potential, and the Omani cryptocurrency market is in an expansion phase[46](index=46&type=chunk) - The Group ventured into the digital asset sector by subscribing to exchangeable bonds, with the cooperative target company, Coin Cove LLC, registered with the Central Bank of Oman Financial Services Authority[46](index=46&type=chunk) - This move aims to diversify the Group's investment portfolio, generate stable interest income, and explore the potential of the emerging financial industry in the Sultanate of Oman[46](index=46&type=chunk) [Financial Review](index=21&type=section&id=Financial%20Review) The Group's revenue significantly decreased by 81.9% due to reduced finance guarantee and energy storage sales, but strong growth in advisory services, new breeding income, increased impairment credits, and no property impairment loss collectively narrowed the loss before tax [Revenue](index=21&type=section&id=Revenue%20(Financial%20Review)) The Group's total revenue significantly decreased, primarily dragged down by finance guarantee and energy storage system sales income, while consultancy and maintenance service fees and breeding service income achieved growth | Revenue Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Net Income from Finance Guarantee Services | 1,100 | 14,100 | (92.2%) | | Income from Non-Finance Guarantee Services | 20 | 40 | (50.0%) | | Income from Financial Advisory and Maintenance Services | 5,100 | 100 | 5000.0% | | Income from Sale of Market Hogs | – | 4,400 | (100.0%) | | Income from Hog Breeding Services | 3,200 | – | N/A | | Income from Sale of Energy Storage Systems | – | 35,300 | (100.0%) | | **Total Revenue** | **9,900** | **54,500** | **(81.9%)** | - Net income from finance guarantee services significantly decreased by **92.2%**, mainly due to the impact of external economic conditions and a slowdown in financing demand from small and medium-sized enterprises[47](index=47&type=chunk) - Income from financial advisory and maintenance services significantly increased to **RMB 5.1 million**, stemming from providing business management system technical consulting and maintenance services to customers[49](index=49&type=chunk) - Income from hog breeding services was **RMB 3.2 million**, but costs amounted to **RMB 6.3 million**, resulting in a gross loss[51](index=51&type=chunk) - No revenue was recorded from energy storage system sales due to intense competition in the South African market and no new sales orders[52](index=52&type=chunk) [Other Income](index=23&type=section&id=Other%20Income%20(Financial%20Review)) The Group's other income increased by 76.0% year-on-year to RMB 2.3 million, primarily from the recovery of bad debts | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Bank Deposit Interest Income | 1,063 | 1,091 | (2.6%) | | Recovery of Bad Debts | 818 | – | N/A | | Others | 417 | 204 | 104.4% | | **Total** | **2,298** | **1,306** | **76.0%** | [Impairment and Provisions Debited / (Credited)](index=23&type=section&id=Impairment%20and%20Provisions%20Debited%20%2F%20%28Credited%29) Impairment and provisions debited / (credited) for the period amounted to Thousand RMB (12,007), primarily due to the reversal of provisions for guarantees issued resulting from a significant decrease in outstanding guarantees and guarantee income | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | | :--- | :--- | :--- | | Provisions Credited for Guarantees Issued | (11,012) | (4,848) | | Total Impairment Provisions Debited (Credited) | (1,000) | (1,430) | | **Total** | **(12,007)** | **(6,278)** | - Provisions credited for guarantees issued increased significantly to approximately **RMB 11.0 million**, compared to **RMB 4.8 million** in the prior period[54](index=54&type=chunk) [Impairment Loss on Property, Plant and Equipment](index=24&type=section&id=Impairment%20Loss%20on%20Property%2C%20Plant%20and%20Equipment%20(Financial%20Review)) No impairment loss provision was recognized for property, plant and equipment this period, contrasting with a Thousand RMB 15.6 million impairment loss recognized in the prior period, mainly because the recoverable amount of related non-current assets did not significantly differ from their carrying amount - For the six months ended June 30, 2025, the Group did not recognize an impairment loss provision for property, plant and equipment (2024: impairment loss of approximately **RMB 15.6 million**)[55](index=55&type=chunk) [Operating Expenses](index=24&type=section&id=Operating%20Expenses) The Group's operating expenses (including R&D costs) decreased by 16.0% year-on-year to RMB 17.9 million, primarily due to reductions in salaries and wages and depreciation expenses | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Salaries and Wages | 7,379 | 8,253 | (10.6%) | | Depreciation Expenses | 2,228 | 5,691 | (60.8%) | | Intermediary and Consulting Fees | 2,608 | 3,402 | (23.3%) | | Exchange Loss | 2,567 | 851 | 201.6% | | **Total** | **17,925** | **21,274** | **(16.0%)** | - The decrease in salaries and wages was mainly due to the Group's salary adjustments for some employees[56](index=56&type=chunk) - The decrease in depreciation expenses was mainly because the market hogs segment expanded its operating scale, with more depreciation allocated to breeding costs rather than operating expenses[56](index=56&type=chunk) [Loss Before Tax](index=24&type=section&id=Loss%20Before%20Tax%20(Financial%20Review)) The Group's loss before tax significantly decreased by 75.2% year-on-year to RMB 4.7 million, primarily attributable to no impairment loss provision made for property, plant and equipment | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Loss Before Tax | (4,743) | (19,144) | (75.2%) | - The reduction in loss before tax was mainly due to no impairment loss provision made for property, plant and equipment during the reporting period[58](index=58&type=chunk) [Income Tax](index=25&type=section&id=Income%20Tax%20(Financial%20Review)) The Group's income tax expense decreased by 34.5% year-on-year to RMB 1.9 million, primarily due to the reversal of deferred tax assets | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Income Tax Expense | (1,861) | (2,919) | (34.5%) | [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) The Group's cash and bank balances increased, pledged bank deposits decreased, and the capital gearing ratio significantly declined, indicating improved liquidity and reduced financial leverage, mainly due to share issuance through placing and a reduction in total liabilities - The Group seeks other investment opportunities that offer better returns with lower risks to effectively utilize financial resources[60](index=60&type=chunk) | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Pledged Bank Deposits | 5,200 | 33,000 | (84.3%) | | Cash and Bank Balances | 224,200 | 185,600 | 20.8% | - The increase in cash and bank balances primarily resulted from the Group's share issuance through placing during the reporting period[62](index=62&type=chunk) - The capital gearing ratio decreased from approximately **135%** as of December 31, 2024, to approximately **97.3%** as of June 30, 2025, mainly due to a reduction in total liabilities, particularly guaranteed liabilities and interest-bearing borrowings[64](index=64&type=chunk) [Prospects and Outlook](index=26&type=section&id=Prospects%20and%20Outlook) Looking ahead to the second half of 2025, the Group anticipates slower global economic growth and challenges for Mainland China's economy such as weak demand; the Group will continue to adhere to prudent and stable operating principles, cautiously develop traditional businesses, explore adjustments to the hog supply chain business, restore international energy storage business, and steadily advance its digital asset sector initiatives [Macro Outlook](index=26&type=section&id=Macro%20Outlook) Global economic growth is expected to continue slowing in the second half of 2025, with Mainland China's economy facing multiple challenges, prompting the government to strengthen macro-policy adjustments; the Group will adhere to prudent and stable operating principles, striving for sustainable growth through developing traditional businesses, adjusting supply chain services, and exploring new areas - Global economic growth continues to slow amidst multiple uncertainties, constrained by trade protectionism, geopolitical conflicts, and other structural challenges[65](index=65&type=chunk) - Mainland China's economy faces issues such as weak demand, structural overcapacity, and deflationary pressure, prompting the government to strengthen macro-policy adjustments[65](index=65&type=chunk) - The Group will strive for sustainable growth in a complex environment by prudently developing traditional businesses, adjusting and optimizing supply chain services, and exploring new sector opportunities[65](index=65&type=chunk) [Prudent Development of Traditional Businesses](index=26&type=section&id=Prudent%20Development%20of%20Traditional%20Businesses%20(Prospects%20and%20Outlook)) The Group will continue to deepen risk management in its guarantee business, strengthen cooperation with banks to launch customized products, and expand the coverage of electronic bidding guarantee services; the finance lease business will enhance risk prevention and control and actively pursue the recovery of receivables related to local government debts - The guarantee business will continue to adhere to the "risk first, business second" principle, deepen risk management, strengthen synergistic cooperation with banks, and launch customized guarantee products[66](index=66&type=chunk) - Continue to expand cooperation with more regional public resource trading centers, conduct low-risk businesses, and broaden service coverage[66](index=66&type=chunk) - The finance lease business will strengthen risk prevention and control, leverage policy support, and fully communicate with relevant parties to implement the recovery of receivables[66](index=66&type=chunk) [Exploring Opportunities to Adjust Hog Supply Chain Business](index=27&type=section&id=Exploring%20Opportunities%20to%20Adjust%20Hog%20Supply%20Chain%20Business) The Group will continue to provide efficient breeding solutions to high-quality cooperative enterprises, driving growth in breeding service income by strengthening cooperation, increasing pen utilization, and enhancing professional capabilities; concurrently, research and evaluation of new models and solutions for the hog supply chain business have been initiated - Mainland China's hog breeding industry will implement regulatory policies, but overcapacity pressure will still take time to digest, requiring enterprises to actively respond[67](index=67&type=chunk) - The Group will strengthen strategic cooperation with high-quality hog breeding enterprises in the industry, increase pen utilization, enhance the capabilities of professional teams, and promote steady growth in breeding service income[67](index=67&type=chunk) - Management believes that not engaging in the fattening model in the second half of the year is appropriate[67](index=67&type=chunk) - Research and evaluation of new models and solutions for the hog supply chain business have been initiated to enhance the Group's overall profitability[67](index=67&type=chunk) [Restoring International Energy Storage Business](index=27&type=section&id=Restoring%20International%20Energy%20Storage%20Business) The Group will intensify communication and collaboration with new distributors in South Africa to re-enter the market as soon as possible, conduct in-depth research on global energy storage market competition, and adjust market strategies; concurrently, it will implement its Northern European market strategy, advance certification progress in Australia, and closely monitor global industry dynamics for new development opportunities - The global energy storage market is expected to maintain high growth but faces challenges such as technological innovation, trade barriers, intense competition, and policy uncertainties[68](index=68&type=chunk) - The Group will intensify communication and collaboration with new distributors in South Africa to strive for a prompt re-entry into the market, and conduct in-depth research on global market competition to adjust market strategies[69](index=69&type=chunk) - In the Northern European market, the Group will implement its strategy for new marine shore charging pile products and high-voltage battery systems; in Australia, it will expedite relevant certification progress[69](index=69&type=chunk) [Venturing into Digital Asset Sector](index=28&type=section&id=Venturing%20into%20Digital%20Asset%20Sector%20(Prospects%20and%20Outlook)) The Group highly values the development trends in the digital asset sector, will continuously monitor the performance of its Oman investment project, and establish a dedicated team to explore development opportunities in digital assets and real-world asset (RWA) tokenization, seeking collaborations to create new performance growth points for the Group, while adhering to prudent principles and steadily advancing under legal and compliant premises - Digital assets, as a strategic emerging sector with broad prospects, continue to expand globally, with Hong Kong having implemented the "Stablecoin Ordinance"[70](index=70&type=chunk) - The Group will continuously monitor the development and performance of its Oman investment project and establish a dedicated team to explore development opportunities in digital assets, real-world assets (RWA), and other areas[70](index=70&type=chunk) - The Group will adhere to prudent principles, steadily advance projects under legal and compliant premises, and strictly follow listing rules for disclosure of progress[70](index=70&type=chunk) [Other Information](index=29&type=section&id=Other%20Information) This section covers dividend policy, corporate governance, directors' securities transactions, audit committee, share transactions, competition, public float, post-reporting period events, publication of reports, acknowledgements, and board composition [Dividends](index=29&type=section&id=Dividends%20(Other%20Information)) The Board of Directors resolved not to declare an interim dividend for the six months ended June 30, 2025 - No interim dividend was declared for the current period[71](index=71&type=chunk) [Corporate Governance](index=29&type=section&id=Corporate%20Governance) The Company has adopted and complied with the code provisions in Appendix C1 of the Listing Rules and will continue to review and strengthen its corporate governance practices - The Company has adopted and complied with the code provisions in Appendix C1 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[72](index=72&type=chunk) [Standard Code for Securities Transactions by Directors](index=29&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules, and all Directors confirmed full compliance with the code during the reporting period - The Company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules as the code of conduct for Directors' dealings in the Company's listed securities[74](index=74&type=chunk) - All Directors confirmed full compliance with the Standard Code during the six months ended June 30, 2025[74](index=74&type=chunk) [Audit Committee](index=29&type=section&id=Audit%20Committee) The Company's Audit Committee, established on October 18, 2013, is primarily responsible for advising on the appointment of external auditors, reviewing financial statements, and coordinating internal control procedures; this interim announcement has been reviewed by the Audit Committee and the auditors - The Audit Committee's primary responsibilities include advising on the appointment and removal of external auditors, reviewing financial statements, and coordinating internal control procedures and risk management[75](index=75&type=chunk) - The Audit Committee members include Mr Tsang Hung Kei (Chairman), Mr Au Tin Kei, and Mr Chow Siu Kong, all of whom are independent non-executive Directors[75](index=75&type=chunk) - This interim announcement has been reviewed by the Audit Committee and the Company's auditors, RSM Hong Kong[76](index=76&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities and Treasury Shares](index=29&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities%20and%20Treasury%20Shares) The Group completed the placing of 77,000,000 new shares in May 2025, raising net proceeds of approximately HKD 53.36 million, primarily for subscribing to exchangeable bonds, repaying existing loans, and general working capital; during the reporting period, some share options were exercised [Placing](index=29&type=section&id=Placing) The Group completed the placing of 77,000,000 new shares in May 2025, raising net proceeds of approximately HKD 53.36 million, primarily for subscribing to exchangeable bonds, repaying existing loans, and general working capital - On May 26, 2025, the Group completed the placing of **77,000,000 new shares** at a placing price of **HKD 0.70 per share** to no less than six independent placees[77](index=77&type=chunk) - The net proceeds from the placing, approximately **HKD 53.36 million**, are intended for the cash consideration for subscribing to exchangeable bonds, repayment of existing loans and outstanding amounts, and general working capital for the Group[78](index=78&type=chunk) [Share Options](index=30&type=section&id=Share%20Options) For the six months ended June 30, 2025, 86,000 and 90,000 share options under the 2020 and 2023 share option schemes, respectively, were exercised; the 2025 share options have not yet vested - For the six months ended June 30, 2025, **86,000 share options** under the 2020 share option scheme were exercised[79](index=79&type=chunk) - For the six months ended June 30, 2025, **90,000 share options** under the 2023 share option scheme were exercised[79](index=79&type=chunk) - Share options to subscribe for **9,000,000 shares** under the 2025 share option scheme remain outstanding but have not yet vested[80](index=80&type=chunk) [Competition and Conflicts of Interest](index=30&type=section&id=Competition%20and%20Conflicts%20of%20Interest) During the review period, none of the Company's Directors, controlling shareholders, or substantial shareholders and their associates engaged in any business that competed or might compete with the Group's business, nor were there any other conflicts of interest - None of the Company's Directors, controlling shareholders or substantial shareholders or any of their respective associates engaged in any business that competed or might compete with the Group's business or had any other conflicts of interest during the review period[81](index=81&type=chunk) [Public Float](index=31&type=section&id=Public%20Float) As of the date of this announcement, the Company has maintained the public float as required by the Hong Kong Listing Rules - The Company has maintained the public float as required by the Hong Kong Listing Rules[82](index=82&type=chunk) [Events After Reporting Period](index=31&type=section&id=Events%20After%20Reporting%20Period) There have been no significant post-reporting period events for the Company or the Group after June 30, 2025, and up to the date of this announcement - There have been no significant post-reporting period events for the Company or the Group after June 30, 2025, and up to the date of this announcement[83](index=83&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=31&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This announcement has been published on the Company's website and the HKEXnews website, and the interim report will also be published on these websites - This announcement has been published on the Company's website (http://www.chinasuccessfinance.com) and the HKEXnews website (www.hkexnews.hk)[84](index=84&type=chunk) - The Company's interim report for the six months ended June 30, 2025, will also be published on the aforementioned websites[84](index=84&type=chunk) [Acknowledgements](index=31&type=section&id=Acknowledgements) The Board of Directors extends its gratitude to management, all employees, loyal shareholders, investors, customers, business partners, associates, banks, and auditors for their support and contributions - The Board of Directors expresses its gratitude for the unwavering support and contributions of the Group's management and all employees[85](index=85&type=chunk) - The Board of Directors also thanks loyal shareholders, investors, customers, business partners, associates, as well as banks and auditors for their continued confidence in the Group's prospects[85](index=85&type=chunk) [Board Composition](index=31&type=section&id=Board%20Composition) As of the date of this announcement, the Board of Directors comprises five executive directors and three independent non-executive directors - The Board of Directors includes five executive directors: Mr Zhang Tiewei, Mr Li Bin, Ms Dai Jing, Mr Xu Kaiying, and Mr Pang Haoquan[87](index=87&type=chunk) - The Board of Directors includes three independent non-executive directors: Mr Tsang Hung Kei, Mr Au Tin Kei, and Mr Chow Siu Kong, all of whom are independent non-executive Directors[87](index=87&type=chunk)