[Company Announcement and Financial Highlights](index=1&type=section&id=Company%20Announcement%20and%20Financial%20Highlights) This section provides an overview of 7Road Holdings Limited's unaudited interim results for the six months ended June 30, 2025, and key financial performance [Company Information](index=1&type=section&id=Company%20Information) 7Road Holdings Limited (Stock Code: 797) released its unaudited consolidated interim results for the six months ended June 30, 2025 - Company Name: **7Road Holdings Limited**, Stock Code: **797**[2](index=2&type=chunk) - Announcement content: Unaudited consolidated interim results for the six months ended June 30, 2025[3](index=3&type=chunk) [Financial Performance Summary](index=1&type=section&id=Financial%20Performance%20Summary) In H1 2025, total revenue from continuing operations increased by 26.5% to RMB 176.4 million, achieving a profit of RMB 26.1 million, turning losses into profits 2025 H1 Key Financial Data Summary | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | Change | | :--- | :--- | :--- | :--- | | Revenue | 176,387 | 139,389 | +26.5% | | Profit/(Loss) for the period | 26,099 | (5,971) | Turnaround | | Profit/(Loss) for the period attributable to owners of the Company | 27,129 | (7,814) | Turnaround | - Total revenue from continuing operations was approximately **RMB 176.4 million**, an increase of approximately **26.5%** year-on-year[5](index=5&type=chunk) - Profit for the period was approximately **RMB 26.1 million**, compared to a loss of approximately **RMB 6.0 million** in the same period last year, achieving a turnaround[5](index=5&type=chunk) [Business Overview](index=2&type=section&id=Business%20Overview) This section details the overall market conditions for the gaming industry and the Group's operational review and outlook for the second half of 2025 [Industry Overview](index=2&type=section&id=Industry%20Overview) In H1 2025, China's gaming market achieved record-high actual sales revenue and user scale, with strong growth in mobile and mini-program games, and increased overseas revenue from self-developed games - From January to June 2025, domestic game market actual sales revenue was approximately **RMB 168.0 billion**, a year-on-year increase of **14.08%**[6](index=6&type=chunk) - China's game user scale reached nearly **679 million**, a year-on-year increase of **0.72%**, both historical highs[6](index=6&type=chunk) - Mobile game market actual sales revenue was approximately **RMB 125.309 billion**, a year-on-year increase of **16.55%**; mini-program mobile game revenue increased by **40.2%** to **RMB 23.276 billion**[6](index=6&type=chunk) - Overseas actual sales revenue of self-developed domestic games was approximately **USD 9.501 billion**, a year-on-year increase of **11.07%**, with the US, Japan, and South Korea remaining the main markets[6](index=6&type=chunk) [Business Review for H1 2025](index=3&type=section&id=Business%20Review%20for%20H1%202025) The Group focused on core online game business in H1, achieving a 30.7% revenue increase, with mobile games accounting for 79%, while expanding mini-program games, overseas markets, and integrating AI - During the reporting period, online game business achieved revenue of approximately **RMB 176 million**, a year-on-year increase of **30.7%**[7](index=7&type=chunk) - Mobile game revenue accounted for **79%**, and web game revenue accounted for **21%**[7](index=7&type=chunk) - Self-developed mobile game "DDTank" accumulated revenue increased by **15.2%** year-on-year in H1; exclusive operation of mini-program game "I Am MT" continued to generate revenue[7](index=7&type=chunk) - Overseas publishing business continued to strengthen, with "Shen Qu H5" launched in Europe, America, Hong Kong, Macau, Taiwan, and Southeast Asia, contributing incremental revenue[7](index=7&type=chunk) - Artificial intelligence has been successfully integrated into multiple business lines, improving R&D efficiency and product quality[9](index=9&type=chunk) [Outlook for H2 2025](index=4&type=section&id=Outlook%20for%20H2%202025) The Group will continue its "IP-driven, premium, globalized" strategy, deepening R&D in casual competitive and MMORPGs, exploring niche overseas markets, and launching new multi-platform and mini-program games - The Group will adhere to the "IP-driven, premium, globalized" development strategy, strengthening long-term operations and global publishing capabilities[10](index=10&type=chunk) - Continued deepening of R&D investment in casual competitive and MMORPG fields to enrich product types[10](index=10&type=chunk) - Overseas publishing will explore niche regional market opportunities such as Turkey and the extended Middle East region[10](index=10&type=chunk) - The first "DDTank" IP multi-platform classic version is under development, expected to complete basic R&D within 2025[10](index=10&type=chunk) [Financial Review](index=5&type=section&id=Financial%20Review) This section provides a detailed analysis of the Group's financial performance, liquidity, and financial resources for the period, including key operational data and balance sheet items [Operating Data](index=5&type=section&id=Operating%20Data) The Group assesses operational performance using key performance indicators (MAU, MPAU, ARPPU), with both web and mobile game ARPPU showing year-on-year growth in H1 2025, indicating improved user monetization - The Group uses Monthly Active Users (MAU), Monthly Paying Active Users (MPAU), and Average Revenue Per Paying User (ARPPU) to assess operating performance[12](index=12&type=chunk) 2025 H1 Operating Key Performance Indicators | Indicator | Web Games | Mobile Games | | :--- | :--- | :--- | | Average Monthly Active Users (MAU) | Approx. 640,000 | Approx. 550,000 | | Average Monthly Paying Active Users (MPAU) | Approx. 24,200 | Approx. 47,400 | | Average Revenue Per Paying User (ARPPU) | RMB 626 (YoY +19.2%) | RMB 620 (YoY +15.9%) | [Income Statement Comparison (2025 vs 2024 H1)](index=6&type=section&id=Income%20Statement%20Comparison%20(2025%20vs%202024%20H1)) In H1 2025, the Group's continuing operations achieved an operating profit of RMB 32.4 million, a significant improvement from the RMB 4.8 million operating loss in the prior year, driven by revenue growth and controlled expenses 2025 H1 Income Statement Key Metrics Comparison | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 176,387 | 139,389 | +26.5% | | Cost of Revenue | (53,748) | (35,856) | +49.9% | | Gross Profit | 122,639 | 103,533 | +18.5% | | R&D Expenses | (33,074) | (70,690) | -53.2% | | Selling and Marketing Expenses | (24,690) | (38,023) | -35.1% | | Administrative Expenses | (29,811) | (21,322) | +39.8% | | Operating Profit/(Loss) | 32,419 | (4,789) | Turnaround | | Profit/(Loss) for the period | 26,099 | (5,971) | Turnaround | [Revenue](index=7&type=section&id=Revenue) Total revenue increased by 26.5% year-on-year to RMB 176.4 million in H1 2025, primarily driven by the positive performance of the online game business, with growth in both self-developed and agency games - Total revenue was approximately **RMB 176.4 million**, an increase of approximately **26.5%** year-on-year[15](index=15&type=chunk) - Game business revenue was approximately **RMB 176.4 million**, an increase of approximately **30.7%** year-on-year, mainly due to the positive performance of online games[15](index=15&type=chunk) 2025 H1 Revenue Details | Type of Goods or Services | 2025 (RMB '000) | % | 2024 (RMB '000) | % | | :--- | :--- | :--- | :--- | :--- | | Online Game Revenue | 176,387 | 100.0% | 134,941 | 96.8% | | - Self-developed Games (published by the Group) | 92,733 | 52.6% | 77,734 | 55.8% | | - Self-developed Games (published by other publishers) | 46,322 | 26.3% | 39,035 | 28.0% | | - Agency Games (published by the Group) | 31,623 | 17.9% | 18,172 | 13.0% | | - Agency Games (published by other publishers) | 5,709 | 3.2% | — | — | | IP Licensing | — | — | 3,553 | 2.6% | | Cloud-related Services | — | — | 895 | 0.6% | | **Total** | **176,387** | **100%** | **139,389** | **100%** | [Cost of Revenue](index=7&type=section&id=Cost%20of%20Revenue) Cost of revenue increased by 49.9% year-on-year to RMB 53.7 million, primarily due to higher game channel service fees and agency costs - Cost of revenue was approximately **RMB 53.7 million**, an increase of approximately **49.9%** year-on-year[16](index=16&type=chunk) - The increase was mainly due to higher game channel service fees and agency costs[16](index=16&type=chunk) [Gross Profit and Gross Margin](index=8&type=section&id=Gross%20Profit%20and%20Gross%20Margin) Gross profit increased by 18.5% year-on-year to RMB 122.6 million, but gross margin decreased to 69.5% as cost of revenue grew faster than revenue - Gross profit was approximately **RMB 122.6 million**, an increase of approximately **18.5%** year-on-year[17](index=17&type=chunk) - Gross margin was approximately **69.5%**, a decrease from **74.3%** in the same period last year, mainly because the growth rate of cost of revenue exceeded that of total revenue[17](index=17&type=chunk) [Research and Development Expenses](index=8&type=section&id=Research%20and%20Development%20Expenses) R&D expenses significantly decreased by 53.2% year-on-year to RMB 33.1 million, primarily due to enhanced R&D expense management and reduced staff remuneration - R&D expenses were approximately **RMB 33.1 million**, a decrease of approximately **53.2%** year-on-year[18](index=18&type=chunk) - The decrease was mainly due to strengthened R&D expense management, reduced staff remuneration expenses, and other R&D expenses[18](index=18&type=chunk) [Selling and Marketing Expenses](index=8&type=section&id=Selling%20and%20Marketing%20Expenses) Selling and marketing expenses decreased by 35.1% year-on-year to RMB 24.7 million, primarily due to lower marketing and promotion costs for game operations and publishing - Selling and marketing expenses were approximately **RMB 24.7 million**, a decrease of approximately **35.1%** year-on-year[19](index=19&type=chunk) - The decrease was mainly due to lower marketing and promotion expenses for game operations and publishing compared to the same period last year[19](index=19&type=chunk) [Administrative Expenses](index=9&type=section&id=Administrative%20Expenses) Administrative expenses increased by 39.8% year-on-year to RMB 29.8 million, primarily due to an increase in other professional service fees - Administrative expenses were approximately **RMB 29.8 million**, an increase of approximately **39.8%** year-on-year[20](index=20&type=chunk) - The increase was mainly due to an increase in other professional service fees compared to the same period last year[20](index=20&type=chunk) [Income Tax](index=9&type=section&id=Income%20Tax) Income tax expense increased year-on-year, primarily due to higher profit before tax, with applicable tax rates ranging from 8.25% to 25% - Income tax expense increased year-on-year, mainly due to higher profit before tax[21](index=21&type=chunk) - Applicable income tax rates ranged from **8.25% to 25%** (2024: 12.5% to 25%)[21](index=21&type=chunk) [Profit/(Loss) for the Period](index=9&type=section&id=Profit%2F(Loss)%20for%20the%20Period) Profit for the period attributable to owners of the Company from continuing operations was approximately RMB 27.1 million, successfully reversing the loss from the prior year, mainly due to increased online game revenue - Profit for the period attributable to owners of the Company from continuing operations was approximately **RMB 27.1 million**, compared to a loss of approximately **RMB 9.1 million** in the same period last year[22](index=22&type=chunk) - The turnaround was mainly due to increased revenue from online games' positive performance in H1 2025[22](index=22&type=chunk) [Liquidity and Financial Resources](index=9&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, cash and cash equivalents increased by 64.9% to RMB 100.0 million, primarily driven by net cash inflow from operating activities - Cash and cash equivalents were approximately **RMB 100.0 million**, an increase of approximately **64.9%** compared to December 31, 2024[23](index=23&type=chunk) - The increase was mainly due to net cash inflow from operating activities during the reporting period[23](index=23&type=chunk) [Interest-Bearing Borrowings](index=10&type=section&id=Interest-Bearing%20Borrowings) As of June 30, 2025, total borrowings remained at RMB 15.0 million, indicating a stable financial position - Total borrowings were approximately **RMB 15.0 million**, consistent with December 31, 2024[24](index=24&type=chunk) [Gearing Ratio](index=10&type=section&id=Gearing%20Ratio) As of June 30, 2025, the gearing ratio slightly increased to 7.7%, indicating a low level of financial leverage - The gearing ratio was approximately **7.7%**, a slight increase from **6.9%** as of December 31, 2024[25](index=25&type=chunk) [Capital Expenditure](index=10&type=section&id=Capital%20Expenditure) Capital expenditure significantly decreased by 96.5% to RMB 0.6 million in H1 2025, primarily due to building-related renovations in the prior year 2025 H1 Capital Expenditure Comparison | Item | 2025 (RMB '000) | 2024 (RMB '000) | Change (%) | | :--- | :--- | :--- | :--- | | Servers and other equipment | 25 | 98 | -74.5 | | Motor vehicles | 545 | — | 0 | | Buildings and related renovations and leasehold land | — | 16,178 | -100.0 | | **Total** | **570** | **16,276** | **-96.5** | - Total capital expenditure was approximately **RMB 0.6 million**, a decrease of approximately **96.5%** compared to **RMB 16.3 million** in the same period last year[27](index=27&type=chunk) - The decrease was mainly due to building-related renovations purchased in H1 2024[27](index=27&type=chunk) [Foreign Exchange Risk](index=11&type=section&id=Foreign%20Exchange%20Risk) The Group operates in overseas markets through foreign publishers, exposing it to foreign exchange risks from currencies like USD, but currently has no hedging policy - The Group operates in overseas markets through foreign publishers, bearing foreign exchange risks from currencies such as USD[28](index=28&type=chunk) - For the six months ended June 30, 2025, the Group had no policy to hedge against any foreign currency fluctuations[28](index=28&type=chunk) [Pledged Assets](index=11&type=section&id=Pledged%20Assets) As of June 30, 2025, the Group pledged certain property, plant and equipment and right-of-use assets for borrowings of RMB 15.0 million - Property, plant and equipment of **RMB 7,227,000** and right-of-use assets of **RMB 32,234,000** were pledged for borrowings of **RMB 15.0 million**[29](index=29&type=chunk) [Contingent Liabilities and Guarantees](index=11&type=section&id=Contingent%20Liabilities%20and%20Guarantees) As of June 30, 2025, the Group had no other unrecorded significant contingent liabilities, guarantees, or major litigations, apart from disclosed major legal proceedings and part of Note 16 - Except for major legal proceedings and disclosures in Note 16, there were no other unrecorded significant contingent liabilities, guarantees, or major litigations[31](index=31&type=chunk) [Future Plans for Material Investments or Capital Assets](index=11&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of the announcement date, the Group has no other future plans for material investments or capital assets beyond those already disclosed - As of the announcement date, the Group has no other future plans for material investments or capital assets[32](index=32&type=chunk) [Material Investments Held](index=11&type=section&id=Material%20Investments%20Held) The Group holds material investments in Shanghai Chaoxi, Ningbo Lianjun, and Nanjing Linghang; the Shanghai Chaoxi investment was sold in July 2025, generating a gain, while the others are long-term investments [Investment in Shanghai Chaoxi](index=11&type=section&id=Investment%20in%20Shanghai%20Chaoxi) As of June 30, 2025, the Group held approximately 1.97% equity in Shanghai Chaoxi with a fair value of RMB 394.0 million, recognizing an unrealized fair value gain of RMB 14.0 million; this investment was sold in July 2025, yielding a gain - As of June 30, 2025, the fair value of the investment in Shanghai Chaoxi was approximately **RMB 394.0 million**, accounting for approximately **21.4%** of total assets[33](index=33&type=chunk) - Accumulated unrealized fair value gain on investment in Shanghai Chaoxi was approximately **RMB 14.0 million**[33](index=33&type=chunk) - The investment was sold on July 16, 2025, and the Group will record a disposal gain of approximately **RMB 2.0 million**, totaling a gain of approximately **RMB 14.0 million**[35](index=35&type=chunk) [Investment in Ningbo Lianjun](index=12&type=section&id=Investment%20in%20Ningbo%20Lianjun) As of June 30, 2025, the Group held approximately 20.98% equity in Ningbo Lianjun with a fair value of RMB 116.3 million, recognizing an unrealized fair value gain of RMB 11.3 million, considered a medium-to-long-term investment focusing on integrated circuits - The fair value of the investment in Ningbo Lianjun was approximately **RMB 116.3 million**, accounting for approximately **6.3%** of total assets[36](index=36&type=chunk) - Accumulated unrealized fair value gain on investment in Ningbo Lianjun was approximately **RMB 11.3 million**[36](index=36&type=chunk) - The Group actually holds approximately **20.98%** equity in Ningbo Lianjun, a fund focusing on integrated circuits and upstream/downstream enterprises, considered a medium-to-long-term investment[36](index=36&type=chunk) [Direct Investment in Nanjing Linghang](index=12&type=section&id=Direct%20Investment%20in%20Nanjing%20Linghang) As of June 30, 2025, the Group directly held approximately 0.5085% equity in Nanjing Linghang with a fair value of RMB 122.3 million, considered a medium-to-long-term investment expected to yield financial returns from its smart mobility platform business - The fair value of the direct investment in Nanjing Linghang was approximately **RMB 122.3 million**, accounting for approximately **6.6%** of total assets[38](index=38&type=chunk) - The Group directly holds approximately **0.5085%** equity in Nanjing Linghang, which operates a smart mobility platform, and this investment is considered a medium-to-long-term investment[38](index=38&type=chunk) [Material Acquisitions and Disposals of Subsidiaries, Associates, and Joint Ventures](index=13&type=section&id=Material%20Acquisitions%20and%20Disposals%20of%20Subsidiaries,%20Associates,%20and%20Joint%20Ventures) In H1 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures - In H1 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures[40](index=40&type=chunk) [Employees and Remuneration Policy](index=13&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had 209 full-time employees, with 70% in R&D; total employee remuneration in H1 was RMB 45.8 million, based on performance, experience, and ability, with training provided - As of June 30, 2025, the Group had **209** full-time employees, with R&D personnel accounting for **70%**[41](index=41&type=chunk) - Total employee remuneration for H1 2025 was approximately **RMB 45.8 million**[41](index=41&type=chunk) - Remuneration policy is based on performance, experience, and ability, with targeted training provided[42](index=42&type=chunk) [Major Legal Proceedings](index=14&type=section&id=Major%20Legal%20Proceedings) The Group is involved in a legal dispute with Qianhai Huanjing regarding "DDTank" IP contract, with a claim of RMB 60.2 million; the case was remanded for retrial after a successful appeal, but is not expected to affect normal business operations - Qianhai Huanjing filed a lawsuit against Guangzhou Zhangyingkong and Angame Inc. in April 2021 regarding a "DDTank" IP contract dispute, with a claim amount of approximately **RMB 60.2 million**[43](index=43&type=chunk) - The first instance ruling dismissed the claim, Qianhai Huanjing successfully appealed, and the case has been remanded for retrial, but is not expected to affect the Group's normal business operations[43](index=43&type=chunk) [Material Post-Balance Sheet Events](index=14&type=section&id=Material%20Post-Balance%20Sheet%20Events) The Group completed the disposal of its investment in Shanghai Chaoxi-related partnership interests on July 16, 2025, with no other material post-balance sheet events - The Group completed the disposal of its investment in Shanghai Chaoxi-related partnership interests on July 16, 2025[45](index=45&type=chunk) [Financial Statements](index=15&type=section&id=Financial%20Statements) This section presents the Group's interim condensed consolidated statement of profit or loss and other comprehensive income and statement of financial position for the period [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=15&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The statement shows a profit from continuing operations of RMB 26.1 million, profit attributable to owners of the Company of RMB 27.1 million, total comprehensive income of RMB 24.8 million, and basic earnings per share of RMB 0.011 for the six months ended June 30, 2025 2025 H1 Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Profit/(Loss) for the period from continuing operations | 26,099 | (7,246) | | Profit/(Loss) for the period | 26,099 | (5,971) | | Total comprehensive income/(expense) for the period | 24,756 | (6,224) | | Profit/(Loss) for the period attributable to owners of the Company | 27,129 | (7,814) | | Basic earnings/(loss) per share | 0.011 | (0.003) | [Interim Condensed Consolidated Statement of Financial Position](index=17&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were RMB 1,845.2 million, total liabilities were RMB 141.4 million, and net assets reached RMB 1,703.9 million, with financial assets at fair value through profit or loss being a significant component of non-current assets 2025 June 30 Consolidated Statement of Financial Position Summary | Indicator | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Non-current assets | 1,575,811 | 1,547,385 | | Current assets | 269,422 | 257,234 | | **Total Assets** | **1,845,233** | **1,804,619** | | Current liabilities | 122,994 | 113,783 | | Non-current liabilities | 18,376 | 11,225 | | **Total Liabilities** | **141,370** | **125,008** | | Net Assets | 1,703,863 | 1,679,611 | | Total Equity attributable to owners of the Company | 1,703,863 | 1,678,077 | - Financial assets at fair value through profit or loss were the main component of non-current assets, totaling **RMB 841.4 million**[48](index=48&type=chunk) [Notes to Financial Information](index=19&type=section&id=Notes%20to%20Financial%20Information) This section provides detailed notes on the Group's financial information, including general information, basis of preparation, accounting policies, segment information, and specific financial item breakdowns [General Information](index=19&type=section&id=General%20Information) 7Road Holdings Limited, incorporated in the Cayman Islands, primarily develops and publishes web and mobile games in China and other countries, with financial statements presented in RMB - The Company is incorporated in the Cayman Islands, primarily engaged in the development and publishing of web and mobile games in China and other countries[50](index=50&type=chunk) - The unaudited condensed consolidated financial statements are presented in RMB[50](index=50&type=chunk) [Basis of Preparation](index=19&type=section&id=Basis%20of%20Preparation) The financial statements are prepared in accordance with IAS 34 "Interim Financial Reporting" and the HKEX Listing Rules, with accounting policies consistent with the 2024 annual financial statements - The financial statements are prepared in accordance with IAS 34 and the HKEX Listing Rules[51](index=51&type=chunk) - Accounting policies are consistent with the annual financial statements for the year ended December 31, 2024[51](index=51&type=chunk) [Adoption of New and Revised IFRS Accounting Standards](index=19&type=section&id=Adoption%20of%20New%20and%20Revised%20IFRS%20Accounting%20Standards) The Group adopted all new and revised IFRS effective January 1, 2025, with no material changes to accounting policies, presentation, or reported amounts for the current and prior periods - The Group has adopted all new and revised IFRS effective January 1, 2025[52](index=52&type=chunk) - The adoption of these standards did not result in material changes to accounting policies, presentation, or reported amounts for the current and prior periods[52](index=52&type=chunk) [Segment Information and Revenue](index=20&type=section&id=Segment%20Information%20and%20Revenue) The Board considers the Group's business to operate and be managed as a single segment, thus no segment information is presented; the vast majority of non-current assets are located in China, and online game revenue is the primary source of income - The Group's business is operated and managed as a single segment, thus no segment information is presented[53](index=53&type=chunk) - The vast majority of non-current assets are located in China[53](index=53&type=chunk) 2025 H1 Online Game Revenue Details | Type of Goods or Services | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Online Game Revenue | 176,387 | 134,941 | | - Self-developed Games (published by the Group) | 92,733 | 77,734 | | - Self-developed Games (published by other publishers) | 46,322 | 39,035 | | - Agency Games (published by the Group) | 31,623 | 18,172 | | - Agency Games (published by other publishers) | 5,709 | — | | IP Licensing | — | 3,553 | | Cloud-related Services | — | 895 | [Other Income](index=20&type=section&id=Other%20Income) Other income in H1 2025 was RMB 1.4 million, a significant decrease from RMB 13.5 million in the prior year, mainly due to reduced government grants and other income 2025 H1 Other Income Details | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Government grants | 760 | 2,528 | | Refund of China VAT | 581 | 444 | | Others | 38 | 10,573 | | **Total** | **1,379** | **13,545** | [Net Other Gains or Losses and Net Finance Costs](index=21&type=section&id=Net%20Other%20Gains%20or%20Losses%20and%20Net%20Finance%20Costs) Net other gains or losses in H1 2025 was a loss of RMB 0.3 million, compared to a gain of RMB 23.0 million in the prior year, mainly impacted by fair value changes of financial assets; net finance costs improved to a loss of RMB 0.7 million from RMB 0.9 million 2025 H1 Net Other Gains or Losses Details | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Fair value changes of financial assets at fair value through profit or loss | (53) | 21,225 | | (Loss)/gain on disposal of property, plant and equipment and right-of-use assets | (235) | 311 | | Gain on disposal of a subsidiary | 120 | — | | Net foreign exchange (loss)/gain | (36) | 394 | | Others | (88) | 1,081 | | **Total** | **(292)** | **23,011** | 2025 H1 Net Finance Costs Details | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Finance income (total) | 805 | 198 | | Finance costs (total) | (1,500) | (1,142) | | **Net Finance Costs** | **(695)** | **(944)** | [Income Tax Expense](index=22&type=section&id=Income%20Tax%20Expense) Income tax expense in H1 2025 significantly increased to RMB 5.5 million from RMB 0.3 million in the prior year, primarily due to higher current and deferred tax during the period 2025 H1 Income Tax Expense Details | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Current income tax | 1,060 | 14 | | Deferred tax | 4,420 | 321 | | **Total** | **5,480** | **335** | - The increase in income tax expense was mainly due to the increase in profit before tax for the Group and its subsidiaries in H1 2025[21](index=21&type=chunk) [Discontinued Operations](index=22&type=section&id=Discontinued%20Operations) The Group completed the disposal of Shanghai Ling Su Network Technology Co., Ltd. on April 11, 2024, with its cloud computing and related services business classified as discontinued operations, which recorded a profit of RMB 1.3 million in H1 2024 - The Group completed the disposal of all equity interests in Shanghai Ling Su Network Technology Co., Ltd. on April 11, 2024, and its cloud computing and related services business is considered a discontinued operation[64](index=64&type=chunk) 2024 H1 Discontinued Operations Financial Summary | Indicator | 2024 (RMB '000) | | :--- | :--- | | Loss from discontinued operations | (8,167) | | Gain on disposal of discontinued operations | 9,442 | | **Profit for the period from discontinued operations** | **1,275** | [Notes to Operating Profit/(Loss)](index=24&type=section&id=Notes%20to%20Operating%20Profit%2F(Loss)) This note details the expenses comprising operating profit/(loss), highlighting significant year-on-year decreases in employee benefit expenses and promotion and advertising expenses in H1 2025 2025 H1 Major Operating Expenses Details | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Channel service fees and agency costs | 31,995 | 13,356 | | Employee benefit expenses | 45,828 | 69,088 | | Other R&D technical service fees | 8,321 | 23,001 | | Other professional service fees | 14,264 | 3,757 | | Promotion and advertising expenses | 24,690 | 38,297 | - Employee benefit expenses decreased by approximately **33.7%** year-on-year, and promotion and advertising expenses decreased by approximately **35.5%** year-on-year[65](index=65&type=chunk) [Dividends](index=24&type=section&id=Dividends) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[66](index=66&type=chunk) [Basic and Diluted Earnings/(Loss) Per Share](index=25&type=section&id=Basic%20and%20Diluted%20Earnings%2F(Loss)%20Per%20Share) Basic and diluted earnings per share for H1 2025 were both RMB 0.011, a turnaround from a loss of RMB 0.003 in the prior year 2025 H1 Basic and Diluted Earnings/(Loss) Per Share | Indicator | 2025 (RMB) | 2024 (RMB) | | :--- | :--- | :--- | | Basic earnings/(loss) per share — continuing and discontinued operations | 0.011 | (0.003) | | Basic earnings/(loss) per share — continuing operations | 0.011 | (0.004) | | Weighted average number of ordinary shares (thousands) | 2,574,268 | 2,574,268 | - Diluted earnings/(loss) per share is equal to basic earnings/(loss) per share as there are no potential dilutive ordinary shares[68](index=68&type=chunk) [Trade and Other Receivables](index=26&type=section&id=Trade%20and%20Other%20Receivables) As of June 30, 2025, the carrying amount of trade receivables decreased to RMB 58.7 million, with credit terms ranging from 30 to 120 days 2025 June 30 Trade Receivables Ageing Analysis | Ageing | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Within 3 months | 25,431 | 38,993 | | 3 to 6 months | 337 | 1,756 | | 6 months to 1 year | 7,299 | 1,805 | | 1 to 2 years | 1,602 | 2,049 | | Over 2 years | 86,347 | 86,918 | | **Total** | **121,016** | **131,521** | | Provision for impairment losses | (62,354) | (62,930) | | **Carrying Amount** | **58,662** | **68,591** | - The carrying amount of trade receivables decreased from **RMB 68.6 million** as of December 31, 2024, to **RMB 58.7 million**[69](index=69&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=26&type=section&id=Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, financial assets at fair value through profit or loss totaled RMB 863.7 million, primarily comprising listed and unlisted equity investments in China, unlisted limited partnerships in China, and listed shares in Hong Kong 2025 June 30 Financial Assets at Fair Value Through Profit or Loss Details | Type | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Non-current - China listed shares and unlisted equity investments | 298,848 | 263,693 | | Non-current - China unlisted limited partnerships | 542,553 | 545,757 | | Current - Hong Kong listed shares | 22,326 | 18,603 | | **Total** | **863,727** | **828,053** | [Trade and Other Payables](index=27&type=section&id=Trade%20and%20Other%20Payables) As of June 30, 2025, total trade and other payables increased to RMB 79.7 million, mainly consisting of trade payables and remuneration liabilities 2025 June 30 Trade and Other Payables Details | Item | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Trade payables | 42,799 | 21,420 | | Remuneration liabilities | 18,309 | 22,543 | | Other tax payables | 3,385 | 5,276 | | Accrued expenses | 15,039 | 15,754 | | **Total** | **79,678** | **65,158** | - Trade payables increased from **RMB 21.4 million** as of December 31, 2024, to **RMB 42.8 million**[70](index=70&type=chunk) [Contingent Liabilities and Guarantees](index=28&type=section&id=Contingent%20Liabilities%20and%20Guarantees) The "Shen Qu" trade secret litigation was dismissed in the first instance on April 8, 2024, no longer a contingent liability; the Group still provides a guarantee of up to RMB 120 million for the disposed Shanghai Ling Su, but with counter-guarantees, credit risk is not material - The "Shen Qu" trade secret litigation's first instance judgment became effective on April 8, 2024, dismissing all plaintiff's claims, thus no longer constituting a contingent liability for the Group[71](index=71&type=chunk) - The Group provides a guarantee of up to **RMB 120 million** for the disposed Shanghai Ling Su, but has obtained counter-guarantees, making the credit risk not material[72](index=72&type=chunk)[73](index=73&type=chunk) [Other Information and Corporate Governance Summary](index=29&type=section&id=Other%20Information%20and%20Corporate%20Governance%20Summary) This section covers the Group's policies and practices regarding securities transactions, dividends, compliance with corporate governance codes, and the role of the audit committee [Purchase, Sale or Redemption of Listed Securities](index=29&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20Listed%20Securities) For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any listed securities, nor did the Company hold any treasury shares - For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any shares[74](index=74&type=chunk) - The Company did not hold any treasury shares as of June 30, 2025[75](index=75&type=chunk) [Interim Dividend](index=29&type=section&id=Interim%20Dividend) The Board does not recommend the declaration of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[76](index=76&type=chunk) [Compliance with Corporate Governance Code](index=29&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) For the six months ended June 30, 2025, the Company complied with all applicable code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules - The Company has complied with all applicable code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules[77](index=77&type=chunk) [Standard of Conduct for Directors' Securities Transactions](index=29&type=section&id=Standard%20of%20Conduct%20for%20Directors'%20Securities%20Transactions) The Company adopted the Standard Code set out in Appendix C3 of the Listing Rules, and all directors and relevant employees confirmed compliance during the reporting period - The Company has adopted the Standard Code set out in Appendix C3 of the Listing Rules as its own code of conduct for directors and relevant employees dealing in securities[78](index=78&type=chunk) - All directors confirmed compliance with the Standard Code during the reporting period, and no non-compliance by relevant employees was noted[78](index=78&type=chunk) [Audit Committee](index=29&type=section&id=Audit%20Committee) The Audit Committee, composed of three independent non-executive directors, has reviewed the Group's unaudited interim results for the six months ended June 30, 2025 - The Audit Committee is composed of three independent non-executive directors, with Mr. Xue Jun as the chairman of the committee[79](index=79&type=chunk) - The Audit Committee has reviewed the Group's unaudited interim results for the six months ended June 30, 2025[79](index=79&type=chunk) [Publication of Interim Results Announcement and 2025 Interim Report](index=30&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%202025%20Interim%20Report) This announcement has been published on the HKEX and Company websites, and the interim report will be published by the end of September 2025 - This announcement has been published on the HKEX website (www.hkexnews.hk) and the Company's website (www.7road.com)[80](index=80&type=chunk) - The Group's interim report for the six months ended June 30, 2025, will be published by the end of September 2025[80](index=80&type=chunk) [Definitions](index=30&type=section&id=Definitions) This section provides definitions for key terms and abbreviations used throughout the report, including company names, financial metrics, business types, and related entities, ensuring clarity and understanding [Definitions](index=30&type=section&id=Definitions) This chapter provides definitions for key terms and abbreviations used in the report, including company names, financial indicators, business types, and related entities, to ensure clear understanding of the report content - Provides definitions for key terms such as "Directors", "Average Revenue Per Paying User", "Audit Committee", "Average Monthly Paying User", "Board", "Corporate Governance Code", "China", "Company"[82](index=82&type=chunk)[83](index=83&type=chunk) - Includes definitions for business and finance-related terms such as "Group", "Hong Kong", "IP", "Listing Rules", "Monthly Active User", "Mobile Game", "Standard Code", "Monthly Paying User", "Nanjing Linghang", "Ningbo Lianjun", "Online Game"[84](index=84&type=chunk) - Further defines "Partnership Interest", "Paying User", "Qianhai Huanjing", "R&D", "RMB", "Restricted Share Unit", "Senior Management", "Shanghai Ling Su", "Shanghai Chaoxi", "Shares", "Shareholders", "Stock Exchange", "USD", "Web Game", and "%"[85](index=85&type=chunk)[86](index=86&type=chunk)

[Performance Highlights](index=1&type=section&id=Performance%20Highlights) H1 2025 performance saw declines in revenue, pre-tax profit, and profit attributable to equity holders, with no interim dividend declared Performance Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 141.46 | 177.21 | -20.17% | | Profit Before Tax | 37.36 | 39.51 | -5.44% | | Profit Attributable to Equity Holders of the Company | 20.76 | 21.62 | -3.98% | | Interim Dividend | Not Declared | N/A | - | [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) This section presents the group's consolidated financial statements, including the income statement, comprehensive income statement, and financial position, detailing revenue, profit, and asset/liability changes [Consolidated Income Statement](index=2&type=section&id=Consolidated%20Income%20Statement) H1 2025 group revenue decreased **20.17%** to **RMB 141.46 million** due to lower net guarantee fee income, with period profit slightly up despite reduced pre-tax profit Consolidated Income Statement Summary | Metric | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 141,456 | 177,208 | -20.17% | | Net Guarantee Fee Income | 86,037 | 116,918 | -26.41% | | Net Interest Income | 44,562 | 47,122 | -5.43% | | Consulting and Other Business Income | 10,857 | 13,168 | -17.55% | | Profit Before Tax | 37,355 | 39,508 | -5.45% | | Profit for the Period | 26,357 | 24,885 | +5.91% | | Profit Attributable to Equity Holders of the Company | 20,757 | 21,619 | -3.99% | | Basic and Diluted Earnings Per Share (RMB/share) | 0.01 | 0.01 | 0.00% | [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For H1 2025, the group's total comprehensive income for the period increased **20.63%** to **RMB 26.66 million**, driven by a reversal from loss to gain in fair value reserve for equity investments Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary | Metric | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit for the Period | 26,357 | 24,885 | +5.91% | | Equity investments at fair value through other comprehensive income — net change in fair value reserve (non-recyclable) | 401 | (3,713) | N/A | | Other Comprehensive Income for the Period | 301 | (2,785) | N/A | | Total Comprehensive Income for the Period | 26,658 | 22,100 | +20.63% | | Total Comprehensive Income Attributable to Equity Holders of the Company | 21,058 | 18,834 | +11.81% | [Consolidated Statement of Financial Position](index=4&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the group's total assets slightly decreased, while net assets increased, with a lower debt-to-asset ratio due to reduced interest-bearing borrowings and guarantee liabilities Consolidated Statement of Financial Position Summary | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 3,874,319 | 3,884,585 | -0.26% | | Cash and Bank Balances | 899,784 | 887,153 | +1.42% | | Accounts Receivable and Other Receivables | 1,222,410 | 1,114,437 | +9.69% | | Loans and Advances to Customers | 948,990 | 1,002,269 | -5.32% | | Total Liabilities | 1,503,668 | 1,523,500 | -1.30% | | Interest-Bearing Borrowings | 325,309 | 359,852 | -9.59% | | Guarantee Liabilities | 204,337 | 234,397 | -12.82% | | Net Assets | 2,370,651 | 2,361,085 | +0.41% | | Total Equity Attributable to Equity Holders of the Company | 2,021,181 | 2,029,778 | -0.42% | [Notes to the Unaudited Interim Financial Report](index=6&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Financial%20Report) This section provides detailed notes to the unaudited interim financial report, covering accounting policies, revenue breakdown, and specific financial instrument details [1 Basis of Preparation](index=6&type=section&id=1%20Basis%20of%20Preparation) This interim financial report is prepared in accordance with HKAS 34 and authorized for issue on August 28, 2025 - Interim financial report is prepared in accordance with **HKAS 34** and authorized for issue on **August 28, 2025**[9](index=9&type=chunk) [2 Changes in Accounting Policies](index=6&type=section&id=2%20Changes%20in%20Accounting%20Policies) The group adopted HKAS 21 amendments, but it had no significant impact due to the absence of foreign currency non-exchangeable transactions - The group adopted **HKAS 21 amendments**, but it had **no significant impact** due to the absence of foreign currency non-exchangeable transactions[10](index=10&type=chunk) [3 Revenue](index=7&type=section&id=3%20Revenue) The group's revenue, primarily from financing guarantee, lending, factoring, and supply chain services, decreased **20.17%** year-on-year in H1 2025, mainly due to lower net guarantee and consulting service fees Revenue by Category | Revenue Category | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Guarantee Fee Income | 86,037 | 116,918 | -26.41% | | Net Interest Income | 44,562 | 47,122 | -5.43% | | Consulting and Other Business Income | 10,857 | 13,168 | -17.55% | | - Supply Chain Services | 8,419 | 6,275 | +34.16% | | - Consulting Service Fees | 2,438 | 6,893 | -64.50% | | **Total Revenue** | **141,456** | **177,208** | **-20.17%** | [4 Other Income](index=8&type=section&id=4%20Other%20Income) Other income significantly decreased by **81.64%** to **RMB 1.12 million** in H1 2025, mainly due to reduced investment income from receivables-backed investments, despite increased government grants Other Income Summary | Income Category | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Government Grants | 2,763 | 1,864 | +48.23% | | Investment Income from Financial Assets at FVTPL | 1,277 | 1,230 | +3.82% | | Investment Income from Receivables-Backed Investments | 129 | 1,154 | -88.82% | | Others | (2,749) | 1,952 | N/A | | **Total Other Income** | **1,117** | **6,104** | **-81.69%** | [5 Profit Before Tax](index=8&type=section&id=5%20Profit%20Before%20Tax) Profit before tax for H1 2025 was **RMB 37.36 million**, a **5.44%** year-on-year decrease, primarily influenced by reduced impairment losses partially offset by lower revenue and stable staff costs [5(a) Impairment and Provisions Made / (Reversed)](index=8&type=section&id=5(a)%20Impairment%20and%20Provisions%20Made%20%2F%20(Reversed)) Total impairment and provisions made decreased **23.76%** to **RMB 45.79 million** in H1 2025, mainly due to a reversal of impairment losses on loans and advances Impairment and Provisions Summary | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Receivables from Defaulted Guarantees | 41,657 | 40,118 | | Receivables from Guaranteed Customers | 5,256 | (1,970) | | Loans and Advances to Customers | (1,425) | 12,653 | | Factoring Receivables | (188) | 1,153 | | **Total** | **45,791** | **60,061** | [5(b) Staff Costs](index=9&type=section&id=5(b)%20Staff%20Costs) Staff costs for H1 2025 decreased **8.01%** to **RMB 34.43 million**, comprising salaries, wages, bonuses, other benefits, and retirement plan contributions Staff Costs Summary | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Salaries, Wages, Bonuses and Other Benefits | 30,091 | 33,469 | -10.10% | | Retirement Scheme Contributions | 4,336 | 3,955 | +9.63% | | **Total** | **34,427** | **37,424** | **-8.01%** | [5(c) Other Items](index=9&type=section&id=5(c)%20Other%20Items) Depreciation and amortization expenses increased **17.80%** to **RMB 7.69 million** in H1 2025, while auditor's remuneration remained stable Other Items Summary | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Depreciation and Amortization | 7,685 | 6,524 | +17.80% | | Auditor's Remuneration | 740 | 740 | 0.00% | [6 Income Tax in Consolidated Income Statement](index=9&type=section&id=6%20Income%20Tax%20in%20Consolidated%20Income%20Statement) Income tax expense for H1 2025 decreased **24.76%** to **RMB 11.00 million**, mainly due to reduced taxable profit and preferential tax rates for certain subsidiaries Income Tax Expense Summary | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | China Income Tax Provision for the Period | 30,258 | 49,705 | -39.12% | | Deferred Tax | (20,122) | (34,388) | -41.49% | | Under-provision / Over-provision in Prior Year | 862 | (694) | N/A | | **Income Tax Expense** | **10,998** | **14,623** | **-24.79%** | - Certain subsidiaries enjoy preferential income tax rates: **High-tech enterprises (15%)** and **small-profit enterprises (20%)**[17](index=17&type=chunk)[20](index=20&type=chunk) [7 Earnings Per Share](index=10&type=section&id=7%20Earnings%20Per%20Share) Basic and diluted earnings per share remained stable at **RMB 0.01** for H1 2025, reflecting consistent outstanding ordinary shares despite a slight decrease in profit attributable to equity holders Earnings Per Share Summary | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit Attributable to Ordinary Equity Holders of the Company (RMB thousand) | 20,757 | 21,619 | | Weighted Average Number of Ordinary Shares Outstanding (shares) | 1,560,793,000 | 1,560,793,000 | | **Basic and Diluted Earnings Per Share (RMB/share)** | **0.01** | **0.01** | [8 Cash and Bank Balances](index=11&type=section&id=8%20Cash%20and%20Bank%20Balances) As of June 30, 2025, total cash and bank balances increased **1.42%** to **RMB 899.78 million**, driven by higher bank deposits, despite a decrease in restricted bank deposits and accrued interest Cash and Bank Balances Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Cash in Hand | 10 | 9 | +11.11% | | Bank Balances | 580,691 | 559,211 | +3.84% | | Bank Time Deposits | 199,515 | 132,000 | +51.15% | | Restricted Bank Deposits | 113,713 | 188,251 | -39.59% | | Accrued Interest | 5,855 | 7,682 | -23.78% | | **Total** | **899,784** | **887,153** | **+1.42%** | - The group's principal activities are conducted in **RMB**, and the remittance of RMB out of China is subject to **foreign exchange control restrictions**[21](index=21&type=chunk) [9 Accounts Receivable and Other Receivables](index=12&type=section&id=Accounts%20Receivable%20and%20Other%20Receivables) As of June 30, 2025, total accounts receivable and other receivables increased **9.69%** to **RMB 1,222.41 million**, with increases in net receivables from defaulted guarantees, guaranteed customers, and repossessed assets [9(a) Ageing Analysis](index=14&type=section&id=9(a)%20Ageing%20Analysis) The ageing structure of receivables from defaulted guarantees, guaranteed customers, supply chain services, and trade receivables as of June 30, 2025, shows a significant portion remains within one year, with some long-term overdue balances persisting Ageing Analysis Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Receivables from Defaulted Guarantees (net) | 412,630 | 343,984 | | Receivables from Guaranteed Customers (net) | 89,192 | 62,788 | | Receivables from Supply Chain Services (net) | 251,937 | 246,232 | | Trade Receivables (net) | 42,799 | 35,503 | [9(b) Impairment of Receivables from Defaulted Guarantees, Receivables from Guaranteed Customers and Receivables from Supply Chain Services](index=15&type=section&id=9(b)%20Impairment%20of%20Receivables%20from%20Defaulted%20Guarantees,%20Receivables%20from%20Guaranteed%20Customers%20and%20Receivables%20from%20Supply%20Chain%20Services) As of June 30, 2025, the allowance for doubtful accounts for receivables from defaulted guarantees increased to **RMB 321.94 million**, for guaranteed customers to **RMB 52.06 million**, while for supply chain services, it slightly decreased to **RMB 6.82 million** Impairment Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Allowance for Doubtful Accounts for Receivables from Defaulted Guarantees | 321,935 | 280,278 | | Allowance for Doubtful Accounts for Receivables from Guaranteed Customers | 52,055 | 46,796 | | Allowance for Doubtful Accounts for Receivables from Supply Chain Services | 6,824 | 7,408 | - Impairment loss on receivables from defaulted guarantees recognized in the consolidated income statement was **RMB 41.66 million**[30](index=30&type=chunk) - Net remeasurement of loss allowance for receivables from guaranteed customers was **negative RMB 913 thousand**, with new receivables from customer guarantees increasing by **RMB 6.17 million**[31](index=31&type=chunk) - **RMB 584 thousand** was reversed for receivables from supply chain services during the period[33](index=33&type=chunk) [10 Loans and Advances to Customers](index=18&type=section&id=10%20Loans%20and%20Advances%20to%20Customers) As of June 30, 2025, net loans and advances to customers decreased **5.32%** to **RMB 948.99 million**, with a reduction in small loans, while the service industry remains the largest loan recipient and secured loans are the primary collateral method [10(a) Analysis by Nature](index=18&type=section&id=10(a)%20Analysis%20by%20Nature) As of June 30, 2025, entrusted loans increased to **RMB 403.12 million**, while small loans decreased to **RMB 654.06 million**, resulting in a slight overall decrease in total loans and advances and impairment loss provisions Loans and Advances by Nature | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Entrusted Loans | 403,121 | 385,460 | +4.58% | | Small Loans | 654,057 | 727,409 | -10.10% | | Total Loans and Advances to Customers | 1,074,370 | 1,129,051 | -4.84% | | Total Impairment Loss Provisions | (125,380) | (126,782) | -1.11% | | **Net Loans and Advances to Customers** | **948,990** | **1,002,269** | **-5.32%** | [10(b) Analysis by Industry](index=18&type=section&id=10(b)%20Analysis%20by%20Industry) As of June 30, 2025, the service industry remained the largest recipient of the group's loans at **42%**, though its proportion decreased, while wholesale and retail trade loans increased and manufacturing remained stable Loans and Advances by Industry | Industry | June 30, 2025 (RMB thousand) | Proportion (%) | December 31, 2024 (RMB thousand) | Proportion (%) | | :--- | :--- | :--- | :--- | :--- | | Service Industry | 439,429 | 42% | 511,346 | 46% | | Wholesale and Retail Trade | 429,119 | 40% | 390,832 | 35% | | Manufacturing | 148,930 | 14% | 170,991 | 15% | | Real Estate and Construction | 39,700 | 4% | 39,700 | 4% | | **Total** | **1,057,178** | **100%** | **1,112,869** | **100%** | [10(c) Analysis by Collateral Method](index=18&type=section&id=10(c)%20Analysis%20by%20Collateral%20Method) As of June 30, 2025, secured loans remained the group's primary collateral method, though their balance decreased, while unsecured and other loan balances both increased Loans and Advances by Collateral Method | Collateral Method | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Secured Loans | 408,805 | 459,383 | -10.99% | | Unsecured Loans | 189,740 | 177,719 | +6.76% | | Other Loans | 458,633 | 475,767 | -3.60% | | **Total** | **1,057,178** | **1,112,869** | **-5.01%** | [10(d) Overdue Loans by Overdue Analysis](index=19&type=section&id=10(d)%20Overdue%20Loans%20by%20Overdue%20Analysis) As of June 30, 2025, total overdue loans slightly decreased to **RMB 285.66 million**, with a reduction in loans overdue within one year, but a significant increase in loans overdue between one and two years Overdue Loans Summary | Overdue Period | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Overdue within one year (inclusive) | 127,949 | 155,990 | -17.98% | | Overdue between one and two years (inclusive) | 56,771 | 26,328 | +115.69% | | Overdue between two and three years (inclusive) | 8,969 | 4,356 | +105.90% | | Overdue over three years | 91,969 | 101,129 | -9.06% | | **Total** | **285,658** | **287,803** | **-0.75%** | [10(e) Analysis by Impairment Loss Provision Assessment Method](index=20&type=section&id=10(e)%20Analysis%20by%20Impairment%20Loss%20Provision%20Assessment%20Method) As of June 30, 2025, total impairment loss provisions for loans and advances slightly decreased to **RMB 125.38 million**, with an increase in 12-month expected credit losses and a decrease in lifetime expected credit losses for credit-impaired loans Impairment Loss Provision Summary | Impairment Stage | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 12-month Expected Credit Losses | 42,931 | 39,184 | | Lifetime Expected Credit Losses without Credit Impairment | 4,106 | 4,168 | | Lifetime Expected Credit Losses with Credit Impairment | 78,343 | 83,430 | | **Total Impairment Loss Provisions** | **125,380** | **126,782** | - Net remeasurement of loss allowance during the period was **negative RMB 36.28 million**, with new loans and advances increasing by **RMB 34.86 million**[40](index=40&type=chunk) [11 Factoring Receivables](index=22&type=section&id=11%20Factoring%20Receivables) As of June 30, 2025, net factoring receivables increased **4.48%** to **RMB 201.13 million**, with a slight decrease in factoring receivables provision reflecting improved impairment [11(a) Ageing Analysis](index=22&type=section&id=11(a)%20Ageing%20Analysis) As of June 30, 2025, factoring receivables within one year decreased, while those between one and three years increased, and those over three years slightly declined Factoring Receivables Ageing Analysis | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 101,501 | 135,400 | | One to two years | 52,900 | 22,000 | | Two to three years | 25,000 | 5,000 | | Over three years | 58,060 | 66,619 | | Less: Provision for Factoring Receivables | (36,334) | (36,522) | | **Net Amount** | **201,127** | **192,497** | [11(b) Impairment of Factoring Receivables](index=23&type=section&id=11(b)%20Impairment%20of%20Factoring%20Receivables) As of June 30, 2025, total allowance for doubtful accounts for factoring receivables slightly decreased to **RMB 36.33 million**, with a net remeasurement of loss allowance of **negative RMB 1.18 million** during the period Factoring Receivables Impairment Summary | Impairment Stage | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 12-month Expected Credit Losses | 2,056 | 1,173 | | Lifetime Expected Credit Losses without Credit Impairment | 559 | — | | Lifetime Expected Credit Losses with Credit Impairment | 33,719 | 35,349 | | **Total Allowance for Doubtful Accounts** | **36,334** | **36,522** | - Net remeasurement of loss allowance during the period was **negative RMB 1.18 million**, with new factoring receivables generated amounting to **RMB 988 thousand**[44](index=44&type=chunk) [12 Financial Assets at Fair Value Through Other Comprehensive Income](index=24&type=section&id=12%20Financial%20Assets%20at%20Fair%20Value%20Through%20Other%20Comprehensive%20Income) As of June 30, 2025, financial assets at fair value through other comprehensive income, primarily unlisted equity investments, slightly increased to **RMB 12.96 million** Financial Assets at Fair Value Through Other Comprehensive Income Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Unlisted Equity Investments | 12,959 | 12,558 | [13 Financial Assets at Fair Value Through Profit or Loss](index=24&type=section&id=13%20Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, financial assets at fair value through profit or loss decreased **28.70%** to **RMB 109.12 million**, mainly due to a reduction in wealth management products Financial Assets at Fair Value Through Profit or Loss Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Wealth Management Products | 91,090 | 134,161 | | Unlisted Equity Investments | 12,665 | 12,719 | | Financial Assets Arising from Interests in Jointly Controlled Trust Schemes | 5,366 | 6,420 | | **Total** | **109,121** | **153,300** | [14 Receivables-Backed Investments](index=24&type=section&id=14%20Receivables-Backed%20Investments) As of June 30, 2025, net receivables-backed investments slightly increased to **RMB 12.86 million**, comprising certificates of deposit and trust products, with reduced impairment loss provisions Receivables-Backed Investments Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Certificates of Deposit | 10,734 | 10,734 | | Trust Products | 8,364 | 8,364 | | Less: Impairment Loss Provisions | (6,243) | (6,473) | | **Net Amount** | **12,855** | **12,625** | [15 Interest-Bearing Borrowings](index=25&type=section&id=15%20Interest-Bearing%20Borrowings) As of June 30, 2025, total interest-bearing borrowings decreased **9.59%** to **RMB 325.31 million**, primarily due to reduced secured bank loans and other loans, while unsecured bank loans remained stable Interest-Bearing Borrowings Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Bank Loans — Unsecured | 249,990 | 250,490 | -0.20% | | Bank Loans — Secured | — | 40,000 | -100.00% | | Bank Loans — Others | 75,000 | 39,000 | +92.31% | | Other Loans | — | 30,000 | -100.00% | | **Total** | **325,309** | **359,852** | **-9.59%** | - Loans bear interest at **3.05% to 5.0%** (December 31, 2024: 3.05% to 10.00%)[46](index=46&type=chunk) [16 Bonds Payable](index=25&type=section&id=16%20Bonds%20Payable) As of June 30, 2025, total bonds payable slightly increased to **RMB 509.65 million**, following the adjustment of the 2021 corporate bond coupon rate to **3.40%** on February 5, 2024 Bonds Payable Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Corporate Bonds — Face Value | 500,000 | 500,000 | | Corporate Bonds — Interest Adjustment | (46) | (658) | | Corporate Bonds — Accrued Interest | 9,692 | 9,983 | | **Total** | **509,646** | **509,325** | - The coupon rate of the **2021 corporate bonds** was adjusted to **3.40%** on **February 5, 2024**[47](index=47&type=chunk) - For H1 2025, **RMB 8.84 million** in interest was paid on the 2021 corporate bonds[48](index=48&type=chunk) [17 Guarantee Liabilities](index=26&type=section&id=17%20Guarantee%20Liabilities) As of June 30, 2025, total guarantee liabilities decreased **12.82%** to **RMB 204.34 million**, primarily due to reduced deferred income, while guarantee compensation provisions slightly increased Guarantee Liabilities Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Deferred Income | 141,281 | 174,779 | -19.17% | | Guarantee Compensation Provisions | 63,056 | 59,618 | +5.77% | | **Total** | **204,337** | **234,397** | **-12.82%** | - **RMB 3.44 million** was provided for guarantee compensation provisions during the period[49](index=49&type=chunk) [18 Deposits Received and Accruals and Other Payables](index=26&type=section&id=18%20Deposits%20Received%20and%20Accruals%20and%20Other%20Payables) As of June 30, 2025, deposits received slightly decreased, while total accruals and other payables increased **23.55%** to **RMB 228.86 million**, driven by significant increases in accounts payable and dividends payable [18(a) Deposits Received](index=26&type=section&id=18(a)%20Deposits%20Received) Deposits received are interest-free collateral collected from customers for credit guarantees, refundable upon contract expiry - Deposits received are **interest-free**, used as **collateral for credit guarantees**, and are refundable upon contract expiry[50](index=50&type=chunk) [18(b) Accruals and Other Payables](index=27&type=section&id=18(b)%20Accruals%20and%20Other%20Payables) As of June 30, 2025, accounts payable significantly increased **70.76%** to **RMB 57.16 million**, and dividends payable rose from **RMB 2.24 million** to **RMB 32.62 million**, driving the category's growth Accruals and Other Payables Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Accounts Payable | 57,155 | 33,477 | +70.76% | | Advances from Customers | 46,625 | 42,035 | +10.92% | | Accrued Staff Costs | 35,493 | 48,503 | -26.82% | | Dividends Payable | 32,617 | 2,237 | +1358.56% | | Income Tax Payable | 30,668 | 35,955 | -14.69% | | **Total** | **228,860** | **185,239** | **+23.55%** | - Accounts payable primarily relate to **suppliers for supply chain business**, with most balances due within one year[51](index=51&type=chunk) [19 Other Financial Instruments](index=28&type=section&id=19%20Other%20Financial%20Instruments) As of June 30, 2025, total other financial instruments increased **5.35%** to **RMB 157.49 million**, mainly comprising financial liabilities related to Zhongshan Zhongyingshengda, Yunfu Guarantee, and Guangdong Financing Guarantee Other Financial Instruments Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Zhongshan Zhongyingshengda | 106,388 | 108,686 | | Yunfu Guarantee | 10,000 | 10,000 | | Guangdong Financing Guarantee | 40,560 | 30,000 | | **Subtotal** | **156,948** | **148,686** | | Accrued Interest | 540 | 802 | | **Total** | **157,488** | **149,488** | - The company has **contribution return commitments** and **potential repurchase obligations** to specific investors in Zhongshan Zhongyingshengda, Yunfu Guarantee, and Guangdong Financing Guarantee, recognized as financial liabilities[53](index=53&type=chunk)[54](index=54&type=chunk) [20 Financial Liabilities at Fair Value Through Profit or Loss](index=29&type=section&id=20%20Financial%20Liabilities%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, financial liabilities at fair value through profit or loss decreased **33.13%** to **RMB 7.16 million**, primarily related to interests in jointly controlled trust schemes where the company guarantees losses Financial Liabilities at Fair Value Through Profit or Loss Summary | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Financial Liabilities Arising from Interests in Jointly Controlled Trust Schemes | 7,157 | 10,702 | - The company **jointly controls trust schemes** with third parties and **guarantees losses** exceeding the third parties' share[55](index=55&type=chunk)[56](index=56&type=chunk) - Some trust scheme-related loans have matured, and borrowers failed to repay, leading the group to **partially fulfill its guarantee obligations**[57](index=57&type=chunk) [21 Capital, Reserves and Dividends](index=31&type=section&id=21%20Capital,%20Reserves%20and%20Dividends) The group declared a final cash dividend of **RMB 1.9 cents per share** for FY2024, totaling **RMB 29.66 million**, but the Board recommended no interim dividend for H1 2025 Dividends Declared | Dividend Type | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | 2024 Final Dividend (RMB 1.9 cents per share) | 29,655 | — | | 2023 Final Dividend (RMB 2.0 cents per share) | — | 31,216 | - The Board recommended **no interim dividend** for the six months ended June 30, 2025[4](index=4&type=chunk)[99](index=99&type=chunk) [22 Financial Risk Management and Fair Value of Financial Instruments](index=31&type=section&id=22%20Financial%20Risk%20Management%20and%20Fair%20Value%20of%20Financial%20Instruments) As of June 30, 2025, the group's maximum total guarantees issued (net of counter-guarantees) decreased **17.60%** to **RMB 6,207.64 million**, indicating reduced exposure to guarantee business and potential credit loss risk Maximum Total Guarantees Issued | Guarantee Type | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Financing Guarantees | 3,326,384 | 3,988,892 | -16.61% | | Performance Guarantees | 2,936,727 | 3,603,841 | -18.51% | | **Subtotal** | **6,263,111** | **7,592,733** | **-17.49%** | | Less: Deposits Received | (55,471) | (59,483) | -6.74% | | **Total** | **6,207,640** | **7,533,250** | **-17.60%** | - The maximum total guarantees issued (net of counter-guarantees) represents the **maximum potential loss** to be recognized if counterparties completely fail to perform their contractual obligations[62](index=62&type=chunk) [23 Commitments and Contingent Liabilities](index=32&type=section&id=23%20Commitments%20and%20Contingent%20Liabilities) As of June 30, 2025, the group had no significant capital commitments or outstanding litigation and disputes - The group had **no significant capital commitments** as of June 30, 2025[63](index=63&type=chunk) - The group had **no significant outstanding litigation or disputes** as a defendant as of June 30, 2025[64](index=64&type=chunk) [24 Non-Adjusting Events After the Reporting Period](index=32&type=section&id=24%20Non-Adjusting%20Events%20After%20the%20Reporting%20Period) The group paid the 2024 final dividend of **RMB 29.66 million** to shareholders on July 30, 2025 - The group paid the **2024 final dividend of RMB 29.66 million** to shareholders on **July 30, 2025**[65](index=65&type=chunk) [Management Discussion and Analysis](index=33&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the group's business performance, financial review, and future outlook, highlighting strategic initiatives and industry trends [Overview](index=33&type=section&id=Overview) In H1 2025, China's economy grew **5.3%**, with resilient SMEs; the group, as a comprehensive service provider, focuses on financing guarantees, loans, and consulting for SMEs, aligning with national policies for high-quality development - China's GDP grew **5.3%** year-on-year in H1 2025, with the Small and Medium-sized Enterprise Development Index (SMEDI) at **89.1**, higher than 2023 and 2024 levels[66](index=66&type=chunk)[67](index=67&type=chunk) - The group has transformed into a **comprehensive service provider** rooted in credit, supported by industry, and driven by finance, offering customized solutions for SMEs[68](index=68&type=chunk) - The group will adhere to a "stable and adaptive" work approach, focusing on its core business, balancing development with risk control, and empowering enterprise growth through innovation[68](index=68&type=chunk) [Business Review](index=34&type=section&id=Business%20Review) The group's H1 2025 business review shows a decline in net guarantee fee income and outstanding guarantees, while entrusted loans grew and small loans decreased, with continued internal control strengthening and AI platform launch [Guarantee Business](index=34&type=section&id=Guarantee%20Business) As of June 30, 2025, the group's outstanding net guarantee balance decreased **17.60%** to **RMB 6,207.64 million**, and net guarantee fee income fell **26.41%** due to reduced outstanding balances and stricter admission standards Guarantee Business Summary | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Outstanding Net Guarantee Balance | 6,207.64 | 7,533.25 | -17.60% | | Net Guarantee Fee Income (H1) | 86.04 | 116.92 | -26.41% | - The decline in guarantee fee income is primarily due to **reduced outstanding financing guarantee balances**, **tightened guarantee admission standards**, and **decreased deferred income** from the transition between old and new business entities[84](index=84&type=chunk) [SME Lending Business](index=35&type=section&id=SME%20Lending%20Business) The group's SME lending business saw entrusted loans increase **4.58%** to **RMB 403.12 million**, while small loans decreased **10.10%** to **RMB 654.06 million**, resulting in a **5.43%** year-on-year decline in net interest income SME Lending Business Summary | Loan Type | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Entrusted Loan Balance | 403.12 | 385.46 | +4.58% | | Small Loan Balance | 654.06 | 727.41 | -10.10% | | Net Interest Income (H1) | 44.56 | 47.12 | -5.43% | - Entrusted loans have a **monthly fixed interest rate range of 0.5% to 1.15%**, while small loans have a **monthly fixed interest rate range of 0.55% to 2%**[71](index=71&type=chunk)[72](index=72&type=chunk) [Internal Control](index=37&type=section&id=Internal%20Control) The group has established comprehensive internal control policies for guarantee, entrusted loan, and small loan businesses, covering pre-approval, post-lending monitoring, risk assessment, collateral management, and overdue collection - Guarantee business implements **post-event management procedures**, including regular and special post-guarantee monitoring, risk assessment, collateral management, and a **five-level risk classification system**[75](index=75&type=chunk)[76](index=76&type=chunk)[77](index=77&type=chunk) - Entrusted loan business approval involves **project managers, legal reviewers, and the Executive Committee Chairman**, with post-lending management including regular client visits, risk assessment, repayment plan formulation, and collection procedures for overdue loans[78](index=78&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk) - Small loan business approval is handled by the **Risk Management Department and Review Committee**, with post-lending management including maturity reminders, overdue visits, repayment plan negotiations, and recourse or collateral foreclosure for overdue loans[81](index=81&type=chunk) [Major Business Activities During the Period](index=43&type=section&id=Major%20Business%20Activities%20During%20the%20Period) In H1 2025, the group facilitated its first cross-city loan transfer, undertook the "Urban Industrial Financing Risk Compensation Fund Project," issued a land reclamation guarantee for a highway project, and launched an AI intelligent platform based on DeepSeek+Qwen3 - Successfully facilitated **Yunfu City's first cross-city loan transfer** for enterprises, alleviating local business difficulties[82](index=82&type=chunk) - Undertook the **Foshan Chancheng "Urban Industrial Financing Risk Compensation Fund Project,"** promoting industrial and financial integration[82](index=82&type=chunk) - Issued a **land reclamation guarantee** for a temporary land use project in Yunfu City, supporting cost reduction and efficiency improvement for real enterprises[82](index=82&type=chunk) - Launched its **self-developed AI intelligent platform**, based on DeepSeek+Qwen3, focusing on financial services, risk prevention, and office efficiency, marking entry into the era of AI-driven intelligence[83](index=83&type=chunk) [Financial Review](index=44&type=section&id=Financial%20Review) The group's H1 2025 financial performance saw reduced revenue and pre-tax profit, mainly from lower net guarantee and interest income, but was partially offset by decreased impairment losses and narrower associate losses, with period profit up but attributable profit down [Net Guarantee Fee Income](index=44&type=section&id=Net%20Guarantee%20Fee%20Income) Net guarantee fee income decreased **26.41%** year-on-year to **RMB 86.04 million**, primarily due to reduced outstanding guarantee balances, cautious business deployment, and lower deferred guarantee fee income Net Guarantee Fee Income Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Guarantee Fee Income | 86.04 | 116.92 | -26.41% | - The decline is due to **reduced outstanding financing guarantee balances**, **tightened guarantee admission standards**, and **decreased deferred income** from the transition between old and new business entities[84](index=84&type=chunk) [Net Interest Income](index=44&type=section&id=Net%20Interest%20Income) Net interest income decreased **5.43%** year-on-year to **RMB 44.56 million**, with entrusted loan interest income rising **22.73%**, but small loan interest income falling **10.41%**, and bank cash/deposit interest income decreasing **26.07%** Net Interest Income Summary | Item | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Interest Income | 44.56 | 47.12 | -5.43% | | Interest Income from Entrusted Loan Business | 13.77 | 11.22 | +22.73% | | Interest Income from Small Loan Business | 30.30 | 33.82 | -10.41% | | Interest Income from Factoring Business | 10.20 | 9.97 | +2.31% | | Interest Income from Bank Cash and Deposits | 5.36 | 7.25 | -26.07% | - The decrease in interest income from bank cash and deposits is mainly due to the **Central Bank's reduction of commercial bank deposit benchmark interest rates**[90](index=90&type=chunk) [Consulting and Other Business Income](index=45&type=section&id=Consulting%20and%20Other%20Business%20Income) Consulting and other business income decreased **17.54%** year-on-year to **RMB 10.86 million**, primarily due to a **64.59%** drop in consulting business income, which was not fully offset by a **34.16%** increase in supply chain business income Consulting and Other Business Income Summary | Item | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Consulting and Other Business Income | 10.86 | 13.17 | -17.54% | | Supply Chain Business Income | 8.42 | 6.28 | +34.16% | | Consulting Business Income | 2.44 | 6.89 | -64.59% | [Other Income](index=45&type=section&id=Other%20Income) Other income significantly decreased **81.64%** year-on-year to **RMB 1.12 million**, mainly due to a decline in investment income from debt investments Other Income Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Other Income | 1.12 | 6.10 | -81.64% | - The decrease is primarily due to a **decline in investment income from debt investments**[87](index=87&type=chunk) [Share of Loss of Associates](index=45&type=section&id=Share%20of%20Loss%20of%20Associates) Share of loss of associates decreased **41.57%** year-on-year to **RMB 4.09 million**, mainly due to the recovery in operations of some investee companies Share of Loss of Associates Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Share of Loss of Associates | 4.09 | 7.00 | -41.57% | - The reduction in loss is mainly due to the **recovery in operations of some investee companies**[88](index=88&type=chunk) [Guarantee Compensation Provisions](index=45&type=section&id=Guarantee%20Compensation%20Provisions) Guarantee compensation provisions significantly decreased **83.77%** year-on-year to **RMB 3.44 million**, primarily due to a reduction in the group's outstanding net guarantee balance compared to the same period Guarantee Compensation Provisions Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Guarantee Compensation Provisions | 3.44 | 21.20 | -83.77% | - The decrease in provisions is mainly due to a **reduction in the outstanding net guarantee balance**[89](index=89&type=chunk) [Impairment Losses](index=46&type=section&id=Impairment%20Losses) Impairment losses decreased **23.76%** year-on-year to **RMB 45.79 million**, primarily due to a reversal of impairment losses on loans and advances Impairment Losses Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Impairment Losses | 45.79 | 60.06 | -23.76% | - The decrease in impairment losses is mainly due to a **reversal of impairment losses on loans and advances**[91](index=91&type=chunk) [Operating Expenses](index=46&type=section&id=Operating%20Expenses) Operating expenses remained stable year-on-year at **RMB 59.99 million** Operating Expenses Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Expenses | 59.99 | 60.50 | -0.84% | [Profit Before Tax](index=46&type=section&id=Profit%20Before%20Tax) Profit before tax decreased **5.44%** year-on-year to **RMB 37.36 million**, primarily impacted by lower revenue Profit Before Tax Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit Before Tax | 37.36 | 39.51 | -5.44% | [Income Tax](index=46&type=section&id=Income%20Tax) Income tax decreased **24.76%** year-on-year to **RMB 11.00 million**, primarily due to reduced taxable profit Income Tax Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Income Tax | 11.00 | 14.62 | -24.76% | - The decrease in income tax is primarily due to **reduced taxable profit**[94](index=94&type=chunk) [Profit for the Period and Profit Attributable to Equity Holders of the Company](index=47&type=section&id=Profit%20for%20the%20Period%20and%20Profit%20Attributable%20to%20Equity%20Holders%20of%20the%20Company) Profit for the period increased **5.91%** year-on-year to **RMB 26.36 million**, while profit attributable to equity holders of the company decreased **3.98%** to **RMB 20.76 million**, with net profit margin rising from **14.04%** to **18.63%** Profit for the Period and Attributable Profit Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit for the Period | 26.36 | 24.89 | +5.91% | | Profit Attributable to Equity Holders of the Company | 20.76 | 21.62 | -3.98% | | Net Profit Margin | 18.63% | 14.04% | +4.59pp | [Capital Expenditure](index=47&type=section&id=Capital%20Expenditure) Capital expenditure slightly decreased year-on-year to **RMB 0.92 million**, mainly for office equipment and R&D expenses for business operating system enhancements Capital Expenditure Summary | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Capital Expenditure | 0.92 | 0.97 | -5.15% | - Capital expenditure is primarily related to the **acquisition of office equipment** and **R&D expenses for enhancing business operating systems**[96](index=96&type=chunk) [Capital Commitments and Contingent Liabilities](index=47&type=section&id=Capital%20Commitments%20and%20Contingent%20Liabilities) As of June 30, 2025, the group had no significant capital commitments or contingent liabilities - The group had **no significant capital commitments or contingent liabilities** as of June 30, 2025[97](index=97&type=chunk) [Pledge of Assets](index=47&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, the group had not pledged any assets to obtain bank credit or loans - The group had **not pledged any assets** to obtain bank credit or bank loans as of June 30, 2025[98](index=98&type=chunk) [Interim Dividend](index=47&type=section&id=Interim%20Dividend) The Board recommended no interim dividend for the six months ended June 30, 2025 - The Board recommended **no interim dividend** for the six months ended June 30, 2025[99](index=99&type=chunk) [Outlook and Future Business Development of the Group](index=48&type=section&id=Outlook%20and%20Future%20Business%20Development%20of%20the%20Group) For H2, China's economy is expected to remain stable; the group will formulate its "15th Five-Year Plan" focusing on ecological cooperation, industrial deep cultivation, and digital intelligence to become a leading integrated industrial ecosystem service group [(I) Industry Development Trends](index=48&type=section&id=(I)%20Industry%20Development%20Trends) The Chinese government actively supports SME financing and inclusive finance through policy measures, with the financing guarantee industry transitioning from "scale expansion" to "quality improvement" and prioritizing digital transformation - Eight departments, including the National Financial Regulatory Administration, issued **23 measures to support SME financing**, aiming to improve their financing conditions[101](index=101&type=chunk) - The People's Bank of China lowered **re-lending rates by 0.25 percentage points** and **financial institution reserve requirement ratios by 0.5 percentage points** to encourage greater support for the real economy[103](index=103&type=chunk) - The financing guarantee industry is shifting from **"scale expansion" to "quality improvement,"** focusing on specialized, refined, unique, and innovative enterprises, technological innovation, and green development, with **digital transformation** being key to enhancing competitiveness[105](index=105&type=chunk) [(II) Group Development Strategy](index=51&type=section&id=(II)%20Group%20Development%20Strategy) The group's preliminary "15th Five-Year Plan" outlines a strategy of ecological cooperation, industrial deep cultivation, and digital intelligence, aiming to build a leading integrated industrial ecosystem service group with guarantee enhancement, financial facilitation, and equity investment - The group has formulated its preliminary **"15th Five-Year Plan,"** positioning itself as a **"nationally leading integrated industrial ecosystem service group"** combining financing, intelligence, and business integration[107](index=107&type=chunk) - The development path includes **ecological cooperation, synergistic sharing, industrial deep cultivation, and digital intelligence**[107](index=107&type=chunk) - The new business development framework is based on **guarantee enhancement**, driven by **financial facilitation and value-added services**, and opportunistic **equity investments**[107](index=107&type=chunk) [Other Information](index=52&type=section&id=Other%20Information) This section provides additional information on the group's capital structure, liquidity, financial resources, significant investments, human resources, and corporate governance [Capital Structure, Liquidity and Financial Resources](index=52&type=section&id=Capital%20Structure,%20Liquidity%20and%20Financial%20Resources) The group maintains a robust capital structure, balancing shareholder returns and risk, with **RMB 899.78 million** in cash and bank balances, reduced interest-bearing debt, and a **38.81%** debt-to-asset ratio, while managing foreign exchange risk without hedging [Capital Structure](index=52&type=section&id=Capital%20Structure) The group's primary capital management objective is to ensure continuous operation and provide returns to shareholders and stakeholders through risk-aligned pricing and reasonable financing costs - The group's primary objective is to ensure **continuous operation** and provide returns to shareholders and stakeholders through **risk-aligned pricing and reasonable financing costs**[108](index=108&type=chunk) [Foreign Exchange Risk](index=52&type=section&id=Foreign%20Exchange%20Risk) Operating primarily in RMB, with most cash and deposits in RMB subject to foreign exchange controls, the group holds minor HKD and USD bank deposits, facing foreign exchange risk without a hedging policy - The group primarily operates in **RMB**, and the remittance of RMB out of China is subject to **foreign exchange control restrictions**[109](index=109&type=chunk) - The group holds **minor HKD and USD denominated bank deposits**, facing foreign exchange risk, but currently has **no foreign currency hedging policy**[109](index=109&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) The group's liquidity and capital needs are for subsidiary investments, loan disbursements, default payments, and working capital, funded by shareholder contributions, operating cash flow, and bank borrowings, with **RMB 899.78 million** in cash and bank balances as of June 30, 2025 - Liquidity and capital needs are primarily for **subsidiary registered capital investments, loan disbursements, default payments, and working capital**[110](index=110&type=chunk) - Funding sources primarily include **shareholder contributions, operating cash flow, and bank borrowings**[110](index=110&type=chunk) Cash and Bank Balances | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Cash and Bank Balances | 899.78 | 887.15 | [Indebtedness](index=53&type=section&id=Indebtedness) As of June 30, 2025, the group's interest-bearing borrowings were **RMB 325.31 million**, bonds payable **RMB 509.65 million**, and other financial instruments **RMB 157.49 million**, with the debt-to-asset ratio decreasing to **38.81%** due to reduced interest-bearing debt and fair value changes Indebtedness Summary | Debt Type | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Interest-Bearing Borrowings | 325.31 | 359.85 | | Bonds Payable | 509.65 | 509.33 | | Other Financial Instruments | 157.49 | 149.49 | | Financial Liabilities at Fair Value Through Profit or Loss | 7.16 | 10.70 | | Lease Liabilities | 15.40 | 17.08 | Debt-to-Asset Ratio | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Debt-to-Asset Ratio | 38.81% | 39.22% | - The decrease in the debt-to-asset ratio is primarily due to **reduced interest-bearing borrowings** and **fair value changes in financial liabilities** arising from interests in jointly controlled trust schemes[112](index=112&type=chunk) [Off-Balance Sheet Arrangements](index=53&type=section&id=Off-Balance%20Sheet%20Arrangements) The group enters into guarantee contracts with off-balance sheet risks in its ordinary course of business, with total outstanding guarantees of **RMB 6,207.64 million** as of June 30, 2025, and no other off-balance sheet arrangements Total Outstanding Guarantees | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Total Outstanding Guarantees | 6,207.64 | 7,533.25 | - Apart from guarantee contracts, the group had **no other off-balance sheet arrangements** as of June 30, 2025[113](index=113&type=chunk) [Significant Investments](index=53&type=section&id=Significant%20Investments) As of June 30, 2025, the group held no other significant investments beyond the major business activities disclosed in the management discussion and analysis - The group held **no significant investments** as of June 30, 2025, other than the major business activities already disclosed[114](index=114&type=chunk) [Significant Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=53&type=section&id=Significant%20Acquisitions%20and%20Disposals%20of%20Subsidiaries,%20Associates%20and%20Joint%20Ventures) For the six months ended June 30, 2025, the group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the group undertook **no significant acquisitions or disposals** of subsidiaries, associates, or joint ventures[115](index=115&type=chunk) [Future Plans for Material Investments or Capital Assets](index=54&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of June 30, 2025, the group had no specific future plans regarding material investments or capital assets - The group had **no specific future plans** regarding material investments or capital assets as of June 30, 2025[116](index=116&type=chunk) [Events After the Reporting Period](index=54&type=section&id=Events%20After%20the%20Reporting%20Period) From June 30, 2025, to the date of this announcement, the group had no other significant events after the reporting period - From June 30, 2025, to the date of this announcement, the group had **no other significant events** after the reporting period[117](index=117&type=chunk) [Human Resources](index=54&type=section&id=Human%20Resources) As of June 30, 2025, the group had **287 employees**, with **87%** holding bachelor's degrees or higher, and staff costs decreased **8.01%** to **RMB 34.43 million**, with efforts to attract and retain talent through competitive compensation and training Human Resources Summary | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Employees | 287 | 291 | | Proportion of Employees with Bachelor's Degree or Above | 87% | N/A | Staff Costs | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | | :--- | :--- | :--- | | Staff Costs | 34.43 | 37.42 | - The group attracts, retains talent, and enhances employee loyalty through **salaries, bonuses, benefits, allowances, and annual training**[118](index=118&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=54&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20Listed%20Securities) For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities, and the company held no treasury shares - For the six months ended June 30, 2025, neither the company nor its subsidiaries **purchased, sold, or redeemed any of the company's listed securities**[119](index=119&type=chunk) - As of June 30, 2025, the company held **no treasury shares**[119](index=119&type=chunk) [Audit Committee](index=55&type=section&id=Audit%20Committee) The Board's Audit Committee, comprising five members with Mr. Wu Xiangneng as Chairman, reviewed the unaudited consolidated interim financial statements for H1 2025, which were also reviewed by KPMG - The Audit Committee consists of **five members**, with **Mr. Wu Xiangneng** serving as Chairman[120](index=120&type=chunk) - The Audit Committee reviewed the interim financial statements, which were also reviewed by **KPMG**[120](index=120&type=chunk) [Corporate Governance](index=55&type=section&id=Corporate%20Governance) The company adheres to the Corporate Governance Code in Appendix C1 of the Listing Rules, with the Board deeming the combined role of Chairman and CEO beneficial for stable leadership and efficient strategy execution, despite deviating from a specific code provision - The company complies with the **Corporate Governance Code in Appendix C1 of the Listing Rules**[121](index=121&type=chunk) - The roles of Chairman and CEO are combined, deviating from **Code Provision C.2.1**, but the Board believes this arrangement fosters **stable leadership and efficient strategy execution**[121](index=121&type=chunk) [Standard Code for Securities Transactions](index=55&type=section&id=Standard%20Code%20for%20Securities%20Transactions) The company adopted the Standard Code for Securities Transactions by Directors of Listed Issuers, with all directors and supervisors confirming compliance for H1 2025 - The company adopted the **Standard Code for Securities Transactions by Directors of Listed Issuers**[122](index=122&type=chunk) - All directors and supervisors confirmed **compliance with the Standard Code** for the period[122](index=122&type=chunk) [Interim Dividend](index=56&type=section&id=Interim%20Dividend) The Board recommended no interim dividend for the six months ended June 30, 2025 - The Board recommended **no interim dividend** for the six months ended June 30, 2025[123](index=123&type=chunk) [Interim Report](index=56&type=section&id=Interim%20Report) The company's interim report for the six months ended June 30, 2025, will be dispatched to shareholders in September 2025 and available on the HKEX and company websites - The interim report will be **dispatched to shareholders in September 2025** and available on the **HKEX website and the company's website**[124](index=124&type=chunk) [By Order of the Board](index=56&type=section&id=By%20Order%20of%20the%20Board) This announcement was issued by Mr. Wu Liejin, Chairman of the Board, on August 28, 2025, on behalf of a Board comprising executive, non-executive, and independent non-executive directors - The announcement was issued by **Mr. Wu Liejin, Chairman of the Board**, on **August 28, 2025**[125](index=125&type=chunk) - The Board comprises **executive, non-executive, and independent non-executive directors**[125](index=125&type=chunk)

[Company Information and Financial Summary](index=1&type=section&id=Company%20Information%20and%20Financial%20Summary) [Company Basic Information](index=1&type=section&id=Company%20Basic%20Information) AUKEY (Shenzhen) Cross-border E-commerce Co., Ltd. (Stock Code: 2519) announced its interim results for the six months ended June 30, 2025 - Company Name: **AUKEY (Shenzhen) Cross-border E-commerce Co., Ltd**[2](index=2&type=chunk) - Stock Code: **2519**[2](index=2&type=chunk) - Reporting Period: Six months ended **June 30, 2025**[2](index=2&type=chunk) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) For the six months ended June 30, 2025, the company's revenue increased by 29.3% year-on-year to 5,607,246 Thousand RMB, while profit for the period and profit attributable to owners of the company significantly decreased For the six months ended June 30, 2025 Financial Highlights | Indicator | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 5,607,246 | 4,334,982 | +29.3% | | Gross Profit | 1,602,364 | 1,483,440 | +8.0% | | Profit Before Tax | 143,640 | 350,876 | -59.1% | | Profit for the Period | 116,586 | 283,943 | -58.9% | | Profit for the Period Attributable to Owners of the Company | 107,872 | 258,880 | -58.3% | [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the company's revenue significantly increased by 29.3% to 5,607,246 Thousand RMB, but increased costs and expenses, along with a shift from other gains to losses, led to a substantial decrease in profit before tax and profit for the period, with basic and diluted earnings per share falling from 0.67 RMB to 0.26 RMB Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data | Indicator | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 5,607,246 | 4,334,982 | +29.3% | | Cost of Sales | (4,004,882) | (2,851,542) | +40.4% | | Gross Profit | 1,602,364 | 1,483,440 | +8.0% | | Other Income | 24,294 | 15,795 | +53.8% | | Other Gains and Losses | (11,701) | 41,001 | -128.5% | | Selling Expenses | (1,071,004) | (902,851) | +18.6% | | Administrative Expenses | (195,185) | (157,938) | +23.6% | | Research and Development Expenses | (80,146) | (55,851) | +43.5% | | Finance Costs | (127,291) | (43,541) | +192.3% | | Profit Before Tax | 143,640 | 350,876 | -59.1% | | Profit for the Period | 116,586 | 283,943 | -58.9% | | Profit for the Period Attributable to Owners of the Company | 107,872 | 258,880 | -58.3% | | Basic and Diluted Earnings Per Share (RMB) | 0.26 | 0.67 | -61.2% | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets slightly increased, with a decrease in total non-current assets and an increase in total current assets, while both total current and non-current liabilities rose, leading to a minor decrease in net assets and equity attributable to owners of the company, primarily due to increased bank borrowings and lease liabilities Condensed Consolidated Statement of Financial Position Key Data | Indicator | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Total Non-current Assets | 3,977,899 | 4,011,030 | -0.8% | | Total Current Assets | 4,962,106 | 4,768,520 | +4.1% | | Total Assets | 8,940,005 | 8,779,550 | +1.8% | | Total Current Liabilities | 2,880,473 | 2,675,779 | +7.7% | | Total Non-current Liabilities | 2,953,499 | 2,994,458 | -1.4% | | Total Liabilities | 5,833,972 | 5,670,237 | +2.9% | | Net Assets | 3,106,033 | 3,109,313 | -0.1% | | Equity Attributable to Owners of the Company | 3,067,323 | 3,079,521 | -0.4% | | Cash and Cash Equivalents | 1,306,988 | 1,363,752 | -4.2% | | Trade Receivables | 990,490 | 1,269,396 | -22.0% | | Bank Borrowings (Current) | 1,024,843 | 716,626 | +42.9% | | Bank Borrowings (Non-current) | 248,248 | 257,174 | -3.4% | [Notes to the Condensed Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [Basis of Preparation and Presentation and Accounting Policies](index=6&type=section&id=Basis%20of%20Preparation%20and%20Presentation%20and%20Accounting%20Policies) The condensed consolidated financial statements are prepared in accordance with IAS 34 and HKEX Listing Rules, using the historical cost basis, consistent with the accounting policies and methods used in the 2024 consolidated financial statements, with no significant impact from IFRS amendments applied this period - The condensed consolidated financial statements are prepared in accordance with **IAS 34** and the **HKEX Listing Rules**[9](index=9&type=chunk) - The statements are prepared on a **historical cost basis**, with certain financial instruments measured at revalued amounts or fair value[10](index=10&type=chunk) - The application of amendments to IFRS (such as amendments to IAS 21) during the period had **no significant impact** on the financial position and performance[11](index=11&type=chunk) [Revenue and Segment Information](index=6&type=section&id=Revenue%20and%20Segment%20Information) The company's main operating segments are sales of goods and logistics solutions, with total revenue increasing by 29.3% year-on-year for the six months ended June 30, 2025, driven by a significant increase in logistics solutions revenue, while the US market remains the primary revenue source and the China market shows rapid growth - The Group's operating and reportable segments include **sales of goods** and **logistics solutions**[13](index=13&type=chunk) [Analysis of Revenue and Results by Reportable Segment](index=7&type=section&id=Analysis%20of%20Revenue%20and%20Results%20by%20Reportable%20Segment) For the six months ended June 30, 2025, revenue from sales of goods was 3,922,266 Thousand RMB, and logistics solutions revenue was 1,684,980 Thousand RMB, with logistics solutions revenue significantly increasing by 86.4% year-on-year, yet the decline in profit from sales of goods led to an overall 59.1% decrease in the Group's profit before tax Reportable Segment Revenue and Profit | Segment | 2025 Revenue (Thousand RMB) | 2024 Revenue (Thousand RMB) | Revenue Change Rate | 2025 Profit (Thousand RMB) | 2024 Profit (Thousand RMB) | Profit Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Sales of Goods | 3,922,266 | 3,430,989 | +14.3% | 366,731 | 431,946 | -15.1% | | Logistics Solutions | 1,684,980 | 903,993 | +86.4% | 164,987 | 151,656 | +8.8% | | Consolidated Total | 5,607,246 | 4,334,982 | +29.3% | 143,640 (Pre-tax) | 350,876 (Pre-tax) | -59.1% | [Revenue by Product or Service Category](index=8&type=section&id=Revenue%20by%20Product%20or%20Service%20Category) For the six months ended June 30, 2025, sales of goods revenue primarily came from third-party e-commerce platforms, while logistics solutions revenue significantly grew by 86.4%, increasing its proportion of total revenue from 20.9% to 30.1% Revenue by Product or Service Category | Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Sales of Goods - Through Third-Party E-commerce Platforms | 3,641,064 | 3,162,895 | +15.1% | | Sales of Goods - Through Other Channels | 281,202 | 268,094 | +4.9% | | Logistics Solutions Revenue | 1,684,980 | 903,993 | +86.4% | | Total | 5,607,246 | 4,334,982 | +29.3% | [Revenue by Geographical Market](index=8&type=section&id=Revenue%20by%20Geographical%20Market) For the six months ended June 30, 2025, the United States remained the company's largest geographical market with revenue of 3,531,330 Thousand RMB, while the China market's revenue grew rapidly by 85.5% year-on-year, demonstrating strong growth momentum Revenue by Geographical Market | Region | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | China | 1,493,979 | 805,211 | +85.5% | | United States | 3,531,330 | 3,089,609 | +14.3% | | Other North American Countries | 69,578 | 23,809 | +192.2% | | Germany | 221,601 | 155,864 | +42.2% | | Other European Countries | 238,161 | 191,161 | +24.6% | | Others | 52,597 | 69,328 | -24.2% | | Total | 5,607,246 | 4,334,982 | +29.3% | [Other Income and Gains/Losses](index=9&type=section&id=Other%20Income%20and%20Gains%2FLosses) For the six months ended June 30, 2025, other income, primarily from bank interest and government grants, increased by 53.8% year-on-year, while other gains and losses shifted from a gain to a loss, mainly due to net foreign exchange losses Other Income Details | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Bank Interest Income | 13,677 | 11,239 | +21.7% | | Government Grants | 8,501 | 2,461 | +245.4% | | Interest Income from Finance Lease Receivables | 2,000 | 1,801 | +11.0% | | Dividends from Financial Assets at Fair Value Through Other Comprehensive Income | 116 | 294 | -60.5% | | Total | 24,294 | 15,795 | +53.8% | Other Gains and Losses Details | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Gain (Loss) on Disposal of Property, Plant and Equipment | 41 | (706) | N/A | | Net Foreign Exchange (Loss) Gain | (16,132) | 39,929 | -140.4% | | Fair Value Change in Financial Assets at Fair Value Through Profit or Loss | 4,390 | 1,778 | +146.9% | | Total | (11,701) | 41,001 | -128.5% | [Income Tax Expense](index=10&type=section&id=Income%20Tax%20Expense) For the six months ended June 30, 2025, income tax expense decreased by 59.6% year-on-year, primarily due to a reversal of deferred tax from an expense last year to a credit this period, alongside increased current tax in China, Hong Kong, and significantly in the United States Income Tax Expense Details | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Current Tax: Hong Kong | 7,374 | 2,884 | +155.7% | | Current Tax: PRC Enterprise Income Tax | 5,549 | 4,358 | +27.3% | | Current Tax: United States | 21,549 | 6,279 | +243.2% | | Deferred Tax | (7,418) | 53,412 | -113.9% | | Total Income Tax Expense | 27,054 | 66,933 | -59.6% | [Components of Profit for the Period](index=10&type=section&id=Components%20of%20Profit%20for%20the%20Period) For the six months ended June 30, 2025, significant increases in depreciation and amortization, employee benefit expenses, and cost of inventories recognized as an expense were major factors contributing to the decrease in profit for the period Profit for the Period Deductions | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Depreciation and Amortization of Property and Equipment, Right-of-Use Assets and Intangible Assets | 231,656 | 125,693 | +84.3% | | Auditor's Remuneration | 400 | 5 | +7900.0% | | Employee Benefit Expenses | 336,427 | 231,799 | +45.1% | | Write-down of Inventories Recognized as Selling Expenses | 25,673 | 29,038 | -11.6% | | Cost of Inventories Recognized as an Expense (Excluding Write-down of Inventories) | 2,466,453 | 2,068,789 | +19.2% | [Dividends and Earnings Per Share](index=11&type=section&id=Dividends%20and%20Earnings%20Per%20Share) For the six months ended June 30, 2025, the company declared and paid a special dividend of 0.25 RMB per share, totaling 103,801 Thousand RMB, while the Board did not recommend an interim dividend, and basic and diluted earnings per share significantly decreased by 61.2% to 0.26 RMB, mainly due to reduced profit and an increased weighted average number of ordinary shares - The company declared and paid a special dividend of **0.25 RMB per ordinary share**, totaling **103,801 Thousand RMB**, during the interim period[21](index=21&type=chunk) - The Board of Directors decided **not to recommend** the payment of a dividend for the interim period[21](index=21&type=chunk) Earnings Per Share Calculation Data | Indicator | 2025 (Thousand RMB/Thousand Shares) | 2024 (Thousand RMB/Thousand Shares) | Change Rate | | :--- | :--- | :--- | :--- | | Profit for the Period Attributable to Owners of the Company | 107,872 | 258,880 | -58.3% | | Weighted Average Number of Ordinary Shares for Basic and Diluted Earnings Per Share | 412,445 | 385,311 | +7.0% | | Basic and Diluted Earnings Per Share (RMB) | 0.26 | 0.67 | -61.2% | - For the six months ended June 30, 2025, the company repurchased **2,487,600 shares** as treasury shares, which are not included in the total number of issued shares[25](index=25&type=chunk) - Diluted earnings per share were **not presented** for the six months ended June 30, 2025, as there were no potential ordinary shares issued during the period[26](index=26&type=chunk) [Changes in Key Balance Sheet Items](index=12&type=section&id=Changes%20in%20Key%20Balance%20Sheet%20Items) As of June 30, 2025, the company increased investments in property, plant and equipment, reduced intangible asset acquisitions, and recognized new right-of-use assets and lease liabilities from leasing activities; trade receivables and trade and other payables both decreased, but the 91-180 day aging portion of trade receivables significantly increased [Property, Plant and Equipment, Right-of-Use Assets and Intangible Assets](index=12&type=section&id=Property%2C%20Plant%20and%20Equipment%2C%20Right-of-Use%20Assets%20and%20Intangible%20Assets) For the six months ended June 30, 2025, the company's construction costs for property, plant and equipment acquisitions increased, while intangible asset acquisitions significantly decreased, and active leasing activities resulted in new right-of-use assets of 81,404 Thousand RMB and lease liabilities of 97,019 Thousand RMB - Acquisitions of property, plant and equipment and construction costs amounted to **88,571 Thousand RMB**, an **11.7% increase** year-on-year[27](index=27&type=chunk) - Acquisitions of intangible assets amounted to **958 Thousand RMB**, a significant **96.6% decrease** year-on-year[27](index=27&type=chunk) - New right-of-use assets of **81,404 Thousand RMB** and lease liabilities of **97,019 Thousand RMB** were recognized, primarily due to termination, subleasing, and new lease agreements[27](index=27&type=chunk) [Trade Receivables](index=12&type=section&id=Trade%20Receivables) As of June 30, 2025, total trade receivables were 990,490 Thousand RMB, a 22.0% decrease from December 31, 2024, with a reduction in credit loss provisions and a significant increase in receivables aged 91 to 180 days Trade Receivables Details | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Trade Receivables from Third Parties | 1,023,475 | 1,311,157 | -22.0% | | Less: Provision for Credit Losses | (32,985) | (41,761) | -21.1% | | Total | 990,490 | 1,269,396 | -22.0% | Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | 0 to 90 days | 830,423 | 1,187,111 | -30.0% | | 91 to 180 days | 116,708 | 43,820 | +166.3% | | 181 to 365 days | 18,044 | 11,174 | +61.5% | | Over 365 days | 25,315 | 27,291 | -7.2% | | Total | 990,490 | 1,269,396 | -22.0% | [Trade and Other Payables](index=13&type=section&id=Trade%20and%20Other%20Payables) As of June 30, 2025, total trade and other payables were 1,386,935 Thousand RMB, a 9.0% decrease from December 31, 2024, with a significant increase in trade payables from associates, while bills payable and accrued issuance costs/listing expenses decreased Trade and Other Payables Details | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Trade Payables - Third Parties | 1,263,146 | 1,396,100 | -9.5% | | Trade Payables - Associates | 19,583 | 2,349 | +737.9% | | Bills Payable | 28,126 | 39,996 | -29.7% | | Accrued Employee Benefits | 49,569 | 52,355 | -5.4% | | Accrued Issuance Costs/Listing Expenses | - | 8,116 | -100.0% | | Total | 1,386,935 | 1,523,741 | -9.0% | Ageing Analysis of Trade Payables and Bills Payable | Ageing | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | 0 to 90 days | 1,266,675 | 1,338,704 | -5.4% | | 91 to 180 days | 26,277 | 84,059 | -68.8% | | 181 to 365 days | 6,776 | 6,580 | +3.0% | | Over 365 days | 11,127 | 9,101 | +22.3% | | Total | 1,310,855 | 1,438,444 | -8.8% | [Management Discussion and Analysis](index=14&type=section&id=Management%20Discussion%20and%20Analysis) [Industry Environment and Trends](index=14&type=section&id=Industry%20Environment%20and%20Trends) Global digital trade continues to advance, with China's export cross-border e-commerce expected to grow steadily, and the global B2C e-commerce market GMV projected to reach 7,712.5 billion USD by 2028; despite universal pressure from global tariff policy adjustments, the impact on the company's major overseas market sales remains controllable, though the international trade environment remains complex and uncertain - Global digital trade continues to advance, with China's export cross-border e-commerce scale expected to maintain **steady growth in 2025**[31](index=31&type=chunk) - The global B2C e-commerce market's GMV is projected to reach **7,712.5 billion USD by 2028**[31](index=31&type=chunk) - Global tariff policy adjustments pose pressure on operational costs, but the impact on the company's major overseas market sales remains **controllable**[31](index=31&type=chunk) [Business Review](index=14&type=section&id=Business%20Review) During the reporting period, the company leveraged its multi-brand system, digital support, supply chain management, and warehousing logistics network to focus on cross-border B2C business in the "Home and Living" sector, primarily selling through third-party platforms like Amazon, Walmart, and Wayfair, while its logistics solutions business achieved significant growth through Western Post Group, expanding its overseas warehouse network - The company's mission is "Connecting the World, Creating a Better Life," focusing on the "Home and Living" sector through a multi-brand system, digital support, supply chain management, and warehousing logistics network[32](index=32&type=chunk) - It primarily engages in cross-border B2C business through **third-party online platforms** such as Amazon, Walmart, and Wayfair[32](index=32&type=chunk) - Logistics solutions are provided through **WESTERN POST (SG) PTE. LTD. and its subsidiaries ("Western Post Group")**, enabling efficient and low-cost delivery[32](index=32&type=chunk) [Core Business and Brands](index=14&type=section&id=Core%20Business%20and%20Brands) During the reporting period, the company focused on furniture and home furnishing products under proprietary brands like ALLEWIE and IRONCK, with several core product categories consistently ranking first in market share on Amazon US, and new categories such as wardrobes, storage cabinets, and cat trees also performing strongly Revenue by Business Line | Business Line | 2025 (Thousand RMB) | % of Revenue | 2024 (Thousand RMB) | % of Revenue | | :--- | :--- | :--- | :--- | :--- | | Sales of Goods | 3,922,266 | 69.9% | 3,430,989 | 79.1% | | Logistics Solutions | 1,684,980 | 30.1% | 903,993 | 20.9% | | Total | 5,607,246 | 100.0% | 4,334,982 | 100.0% | - Focus on furniture and home furnishing products under proprietary brands such as **ALLEWIE, IRONCK, LIKIMIO, SHA CERLIN, HOSTACK, and FOTOSOK**[33](index=33&type=chunk) - Multiple core product categories consistently held the **top market share** on Amazon US, with new categories also ranking among the leaders[33](index=33&type=chunk) [Product Portfolio](index=16&type=section&id=Product%20Portfolio) The company strategically focuses more on furniture, home furnishings, and home appliances, while also offering power tools (such as electric screwdrivers and air pumps) and other products (such as power banks and chargers), providing a rich product portfolio with high-tech features and practical designs - Strategically focusing more on **furniture, home furnishings, and home appliances**, including beds, bookshelves, wardrobes, refrigerators, and juicers[36](index=36&type=chunk) - The product portfolio also includes **power tools** such as electric screwdrivers, air pumps, jump starters, and car vacuum cleaners[39](index=39&type=chunk) - Other products include **power banks, chargers, and data cables**[39](index=39&type=chunk) [Supply Chain and Logistics](index=17&type=section&id=Supply%20Chain%20and%20Logistics) The company is accelerating the optimization and upgrade of its supply chain system, strategically adjusting its layout to deepen its presence in non-US markets, and enhancing competitiveness through continuous product development; leveraging Western Post Group, cross-border logistics solutions have made significant progress, with an additional 924,000 square feet of warehouse space and an 86.4% year-on-year increase in logistics solutions revenue - Accelerating the optimization and upgrade of the supply chain system by adding production bases and expanding into **non-US markets**[40](index=40&type=chunk)[41](index=41&type=chunk) - During the reporting period, **79 new patent applications** were filed, and **17 international design awards** were received (13 Red Dot, 4 iF)[40](index=40&type=chunk) - Leveraging Western Post Group's technological empowerment, cross-border logistics solutions cover the entire chain, with an additional warehouse area of **924,000 square feet**[40](index=40&type=chunk) - Logistics solutions revenue achieved significant growth, with a year-on-year increase of **86.4%**[40](index=40&type=chunk) [Sales Network](index=18&type=section&id=Sales%20Network) The company derives most of its revenue from third-party e-commerce platforms, deepening cooperation with leading global platforms such as Amazon, Walmart, and Wayfair, while also selling products through other third-party e-commerce platforms like Shein, Temu, and Tiktok, as well as offline distributors - Most revenue is derived from selling goods through **third-party e-commerce platforms**, deepening cooperation with Amazon, Walmart, and Wayfair[42](index=42&type=chunk) - **Amazon platform**: Standard agreements signed, direct sales to consumers, utilizing FBA services[42](index=42&type=chunk) - **Walmart platform**: Standard agreements signed, direct sales to consumers, utilizing Walmart fulfillment services[42](index=42&type=chunk) - **Wayfair platform**: Products sold to Wayfair, with suggested listing prices, Wayfair makes final decisions[42](index=42&type=chunk) - **Other channels**: Including multiple third-party e-commerce platforms such as Shein, Temu, Tiktok, and offline distributors[42](index=42&type=chunk) [Future Outlook](index=19&type=section&id=Future%20Outlook) The company anticipates significant growth potential in the online furniture market, especially for large furniture items, and plans to enhance market competitiveness by optimizing the supply chain, strengthening brand building, improving logistics efficiency, and deeply applying AI technology to navigate complex economic environments and tariff policy adjustments - The company is committed to long-term development, implementing multi-dimensional strategies across supply chain, brand, logistics, and digital empowerment to enhance risk resistance and market competitiveness[45](index=45&type=chunk) [Industry Development Opportunities](index=19&type=section&id=Industry%20Development%20Opportunities) The online furniture market has immense growth potential, with the global furniture and home furnishings market GMV projected to reach 779.4 billion USD by 2028; despite low online penetration for large furniture, deepening digital consumption, upgraded overseas warehousing logistics infrastructure, and improved installation services are expanding online sales to high-value large furniture, creating a virtuous cycle - The global furniture and home furnishings market's GMV is projected to reach **779.4 billion USD by 2028**[43](index=43&type=chunk) - Online penetration for large furniture is **lower than for small home furnishings**, primarily due to high unit prices, high logistics costs, and complex installation[43](index=43&type=chunk) - Deepening digital consumption behaviors cultivated during the pandemic and upgraded overseas warehousing logistics infrastructure are driving the expansion of online sales for large furniture[44](index=44&type=chunk) [Development Strategies](index=20&type=section&id=Development%20Strategies) The company will implement a global supply chain layout, localized procurement, strengthened brand core competitiveness, improved logistics efficiency and services, and deep application of AI technology for full-process intelligent upgrades to address market challenges and drive a leap in corporate competitiveness [Supply Chain Management](index=20&type=section&id=Supply%20Chain%20Management) The company will accelerate its global supply chain layout by establishing new production bases in advantageous regions and building a localized procurement system, fostering deep cooperation with quality suppliers to mitigate supply chain risks, optimize operational costs, and enhance resilience and efficiency - Accelerating the deep optimization of the supply chain layout and actively promoting a **global supply chain layout**[46](index=46&type=chunk) - Establishing a **localized procurement system** and fostering deep, long-term strategic partnerships with local quality suppliers[46](index=46&type=chunk) - Implementing a **"production + procurement" dual-driven model** to reduce supply chain risks and intermediate costs, ensuring resilience and efficiency[46](index=46&type=chunk) [Brand Building](index=20&type=section&id=Brand%20Building) The company will continue to deepen its brand strategy, increase R&D investment, focus on product functional innovation, enhance quality, performance, and uniqueness, and strengthen brand premium and market influence through precise market positioning, mid-to-high-end product design, and superior user experience - Continuously deepening brand strategy, increasing R&D investment, focusing on **product functional innovation**, and enhancing product quality, performance, and uniqueness[47](index=47&type=chunk) - Enhancing brand and product premium capabilities through **precise market positioning, mid-to-high-end product design, and superior user experience**[47](index=47&type=chunk) [Logistics Management](index=21&type=section&id=Logistics%20Management) The company will build its logistics system by enhancing efficiency, upgrading infrastructure, and optimizing services, utilizing intelligent management systems to improve inventory turnover and delivery timeliness, increasing investment in overseas warehouses, and establishing a refined after-sales service system to boost customer satisfaction and loyalty - Optimizing warehousing, transportation, and distribution through an **intelligent logistics management system** to reduce logistics operating costs[48](index=48&type=chunk) - Increasing investment in **overseas warehouses** and regional distribution centers to optimize the warehousing network layout[48](index=48&type=chunk) - Establishing a **refined and responsive after-sales service system** to provide personalized services, enhancing customer satisfaction and loyalty[48](index=48&type=chunk) [AI Empowerment](index=21&type=section&id=AI%20Empowerment) The company will actively promote the deep penetration and integration of AI technology across all business segments, achieving full-process intelligent upgrades from front-end market insights to back-end operational management, precisely predicting market demand through multi-modal data analysis, and building dynamic prediction models for intelligent and automated procurement and inventory management to improve collaborative efficiency and reduce operational costs - Actively promoting the **deep penetration and integration of AI technology** across all company business segments to achieve full-process intelligent upgrades[49](index=49&type=chunk) - Leveraging AI's powerful multi-modal data analysis capabilities to **accurately predict market demand trends** and analyze consumer behavior[49](index=49&type=chunk) - AI will build **dynamic prediction models** through deep mining of back-end operational data, enabling intelligent and automated procurement and inventory management[49](index=49&type=chunk) [Financial Review](index=22&type=section&id=Financial%20Review) [Revenue Analysis](index=22&type=section&id=Revenue%20Analysis) For the six months ended June 30, 2025, the company's total revenue increased by 29.3% year-on-year to 5,607.2 Million RMB, primarily driven by the continuous expansion of sales of goods and significant growth in logistics solutions business, with logistics solutions revenue increasing by 86.4% as the main growth driver [Total Revenue](index=22&type=section&id=Total%20Revenue) For the six months ended June 30, 2025, the company's revenue increased by 29.3% from 4,335.0 Million RMB to 5,607.2 Million RMB, primarily due to expanded sales of goods and increased provision of logistics solutions - Revenue increased by **29.3%** from **4,335.0 Million RMB to 5,607.2 Million RMB**[51](index=51&type=chunk) - Primarily due to the **continuous expansion of sales of goods** and the provision of **more logistics solutions**[51](index=51&type=chunk) [Revenue by Product or Service Category](index=22&type=section&id=Revenue%20by%20Product%20or%20Service%20Category) For the six months ended June 30, 2025, sales of goods remained the primary revenue source, accounting for 69.9% of total revenue, but logistics solutions revenue significantly increased its share to 30.1%, growing by 86.4% year-on-year Revenue by Product or Service Category Details | Product or Service Category | 2025 (Thousand RMB) | % of Revenue | 2024 (Thousand RMB) | % of Revenue | | :--- | :--- | :--- | :--- | :--- | | Sales of Goods | 3,922,266 | 69.9% | 3,430,989 | 79.1% | | Furniture, Home Furnishings and Home Appliances | 3,276,838 | 58.4% | 2,883,923 | 66.5% | | Power Tools | 290,336 | 5.2% | 260,351 | 6.0% | | Other Products | 355,092 | 6.3% | 286,715 | 6.6% | | Logistics Solutions | 1,684,980 | 30.1% | 903,993 | 20.9% | | Total | 5,607,246 | 100.0% | 4,334,982 | 100.0% | [Sales of Goods Revenue](index=22&type=section&id=Sales%20of%20Goods%20Revenue) For the six months ended June 30, 2025, sales revenue from furniture, home furnishings, and home appliances increased by 13.6%, power tools by 11.5%, and other products by 23.8%, primarily driven by the expansion of new sales channels - Sales revenue from furniture, home furnishings, and home appliances increased by **13.6% to 3,276.8 Million RMB**[53](index=53&type=chunk) - Sales revenue from power tools increased by **11.5% to 290.3 Million RMB**[53](index=53&type=chunk) - Sales revenue from other products increased by **23.8% to 355.1 Million RMB**, primarily due to the expansion of new sales channels (e.g., Tiktok, TEMU)[54](index=54&type=chunk) [Logistics Solutions Revenue](index=23&type=section&id=Logistics%20Solutions%20Revenue) For the six months ended June 30, 2025, logistics solutions revenue significantly increased by 86.4% year-on-year to 1,685.0 Million RMB, mainly due to warehouse expansion, an enlarged customer base, increased order fulfillment, and enhanced "last-mile" services and warehousing facility capabilities - Logistics solutions revenue increased by **86.4% to 1,685.0 Million RMB**[55](index=55&type=chunk) - Primarily due to **warehouse expansion, an enlarged customer base, fulfillment of more orders**, and enhanced "last-mile" services and warehousing facility capabilities[55](index=55&type=chunk) [Costs and Gross Profit](index=23&type=section&id=Costs%20and%20Gross%20Profit) For the six months ended June 30, 2025, cost of sales increased by 40.4% year-on-year, leading to a decrease in gross margin from 34.2% to 28.6%; gross margins for both sales of goods and logistics solutions declined, primarily affected by rising ocean freight costs and promotional pricing for new warehouses to attract customers [Cost of Sales](index=23&type=section&id=Cost%20of%20Sales) For the six months ended June 30, 2025, cost of sales increased by 40.4% year-on-year to 4,004.9 Million RMB, primarily due to rising ocean freight costs for sales of goods and a substantial increase in operating costs from warehouse expansion in the logistics solutions business - Cost of sales increased by **40.4% from 2,851.5 Million RMB to 4,004.9 Million RMB**[56](index=56&type=chunk) - Primarily due to **rising ocean freight costs** for sales of goods and a substantial increase in operating costs from **warehouse expansion** in the logistics solutions business[56](index=56&type=chunk) [Gross Profit and Gross Margin](index=23&type=section&id=Gross%20Profit%20and%20Gross%20Margin) For the six months ended June 30, 2025, gross profit increased by 8.0% to 1,602.4 Million RMB, but the gross margin decreased from 34.2% to 28.6%, with sales of goods gross margin falling to 36.5% and logistics solutions gross margin to 10.2%, mainly impacted by ocean freight costs and promotional pricing for new warehouses - Gross profit increased by **8.0% from 1,438.4 Million RMB to 1,602.4 Million RMB**[57](index=57&type=chunk) - Gross margin decreased from **34.2% to 28.6%**, primarily due to rising ocean freight costs for sales of goods and promotional pricing for new warehouses to attract new customers[57](index=57&type=chunk) - Sales of goods gross margin decreased from **38.9% to 36.5%**, and logistics solutions gross margin decreased from **16.6% to 10.2%**[57](index=57&type=chunk) [Other Gains and Losses](index=24&type=section&id=Other%20Gains%20and%20Losses) For the six months ended June 30, 2025, other gains significantly decreased by 128.5% from a gain of 41.0 Million RMB in the prior year to a loss of 11.7 Million RMB, primarily due to a decline in foreign exchange gains resulting from exchange rate fluctuations - Other gains significantly decreased by **128.5% from 41.0 Million RMB to a loss of 11.7 Million RMB**[58](index=58&type=chunk) - Primarily due to a **decline in foreign exchange gains** resulting from exchange rate fluctuations[58](index=58&type=chunk) [Impairment Losses Under Expected Credit Loss Model ("ECL"), Net of Reversals](index=24&type=section&id=Impairment%20Losses%20Under%20Expected%20Credit%20Loss%20Model%20%28%22ECL%22%29%2C%20Net%20of%20Reversals) For the six months ended June 30, 2025, impairment losses under the expected credit loss model shifted from a loss of 3.4 Million RMB in the prior year to a reversal of 4.0 Million RMB, an increase of 216.6%, mainly due to a reduction in bad debts at Western Post Group - Impairment losses under the expected credit loss model increased by **216.6% from a loss of 3.4 Million RMB to a reversal of 4.0 Million RMB**[59](index=59&type=chunk) - Primarily due to a **reduction in bad debts** at Western Post Group[59](index=59&type=chunk) [Operating Expenses](index=24&type=section&id=Operating%20Expenses) For the six months ended June 30, 2025, selling expenses, administrative expenses, and research and development expenses all increased; selling expenses grew by 18.6% in line with revenue growth but the selling expense ratio decreased; administrative expenses rose by 23.6% mainly due to increased employee and consulting fees; and R&D expenses increased by 43.5% primarily due to a higher number of R&D employees [Selling Expenses](index=24&type=section&id=Selling%20Expenses) For the six months ended June 30, 2025, selling expenses increased by 18.6% year-on-year to 1,071.0 Million RMB, generally consistent with revenue growth, while the selling expense ratio decreased from 20.8% to 19.1%, mainly due to changes in revenue structure - Selling expenses increased by **18.6% from 902.9 Million RMB to 1,071.0 Million RMB**[60](index=60&type=chunk) - The selling expense ratio decreased from **20.8% to 19.1%**, primarily due to changes in revenue structure[60](index=60&type=chunk) [Administrative Expenses](index=24&type=section&id=Administrative%20Expenses) For the six months ended June 30, 2025, administrative expenses increased by 23.6% year-on-year to 195.2 Million RMB, primarily due to increased employee and consulting fees - Administrative expenses increased by **23.6% from 157.9 Million RMB to 195.2 Million RMB**[61](index=61&type=chunk) - Primarily due to **increased employee expenses and consulting fees**[61](index=61&type=chunk) [Research and Development Expenses](index=24&type=section&id=Research%20and%20Development%20Expenses) For the six months ended June 30, 2025, research and development expenses increased by 43.5% year-on-year to 80.1 Million RMB, primarily due to an increase in the number of R&D employees - Research and development expenses increased by **43.5% from 55.9 Million RMB to 80.1 Million RMB**[62](index=62&type=chunk) - Primarily due to an **increase in the number of R&D employees**[62](index=62&type=chunk) [Finance Costs](index=24&type=section&id=Finance%20Costs) For the six months ended June 30, 2025, finance costs significantly increased by 192.3% year-on-year to 127.3 Million RMB, primarily due to expanded logistics solutions operations and new leased warehouses, leading to a corresponding increase in finance costs for related lease liabilities - Finance costs increased from **43.5 Million RMB to 127.3 Million RMB**[63](index=63&type=chunk) - Primarily due to the **expansion of logistics solutions operations and new leased warehouses**, leading to a corresponding increase in finance costs for related lease liabilities[63](index=63&type=chunk) [Net Profit](index=25&type=section&id=Net%20Profit) For the six months ended June 30, 2025, net profit significantly decreased by 58.9% year-on-year to 116.6 Million RMB, primarily due to tariff policy adjustments and rising logistics costs for sales of goods, increased operating costs from new leased warehouses in the logistics solutions business, and higher investment costs for new incubation projects diluting profits - Net profit decreased by **58.9% from 283.9 Million RMB to 116.6 Million RMB**[64](index=64&type=chunk) - Key reasons include **tariff policy adjustments and rising logistics costs** for sales of goods, a substantial increase in operating costs from **new leased warehouses** in the logistics solutions business, and **higher investment costs for new incubation projects**[64](index=64&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) [Cash and Cash Equivalents](index=25&type=section&id=Cash%20and%20Cash%20Equivalents) As of June 30, 2025, the company's cash and cash equivalents amounted to 1,307.0 Million RMB, and the company believes its working capital is sufficient to meet current needs, primarily supported by net proceeds from the global offering, bank borrowings, and cash flows from operating activities - As of June 30, 2025, cash and cash equivalents amounted to **1,307.0 Million RMB**[65](index=65&type=chunk) - The company believes its working capital is **sufficient to meet current needs**, primarily from net proceeds from the global offering, bank borrowings, and cash flows from operating activities[65](index=65&type=chunk) [Cash Flow Analysis](index=25&type=section&id=Cash%20Flow%20Analysis) For the six months ended June 30, 2025, net cash from operating activities increased, but net cash outflow from investing activities decreased, and net cash from financing activities shifted from an inflow to an outflow, resulting in a decrease in cash and cash equivalents at period-end Cash Flow Statement Summary | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 271,099 | 239,683 | +13.1% | | Net Cash Used in Investing Activities | (269,382) | (372,911) | -27.7% | | Net Cash Generated From/(Used In) Financing Activities | (45,631) | 84,766 | -153.8% | | Net Decrease in Cash and Cash Equivalents | (43,914) | (48,462) | -9.3% | | Cash and Cash Equivalents at End of Period | 1,306,988 | 762,621 | +71.4% | [Net Cash Generated from Operating Activities](index=25&type=section&id=Net%20Cash%20Generated%20from%20Operating%20Activities) In the first half of 2025, net cash generated from operating activities was 271.1 Million RMB, an increase from 239.7 Million RMB in the first half of 2024 - In the first half of 2025, net cash generated from operating activities was **271.1 Million RMB**, a year-on-year increase of **13.1%**[66](index=66&type=chunk) [Net Cash Used in Investing Activities](index=25&type=section&id=Net%20Cash%20Used%20in%20Investing%20Activities) In the first half of 2025, net cash used in investing activities was 269.4 Million RMB, a decrease from 372.9 Million RMB in the prior year, primarily due to outflows for property, plant and equipment purchases and pledged bank deposits, offset by net inflows from the disposal of wealth management products - In the first half of 2025, net cash outflow from investing activities was **269.4 Million RMB**, a year-on-year decrease of **27.7%**[67](index=67&type=chunk) - Primarily due to the purchase of property, plant and equipment of **89.0 Million RMB**, a net outflow of pledged bank deposits of **215.1 Million RMB**, and a net inflow of **16.0 Million RMB** from the disposal of wealth management products[67](index=67&type=chunk) [Net Cash Generated From/(Used In) Financing Activities](index=26&type=section&id=Net%20Cash%20Generated%20From%2F%28Used%20In%29%20Financing%20Activities) In the first half of 2025, financing activities shifted from a net inflow in the prior year to a net outflow of 45.6 Million RMB, mainly due to increased inflows from new bank borrowings, but also increased outflows for dividend payments, repayment of lease liabilities, and share repurchases - In the first half of 2025, net cash outflow from financing activities was **45.6 Million RMB**, compared to a net inflow of **84.8 Million RMB** in the prior year[68](index=68&type=chunk) - Primarily due to a net inflow of new bank borrowings of **299.3 Million RMB**, but increased outflows for bank interest payments, finance costs for Western Post Group's right-of-use assets, dividends paid, repayment of lease liabilities, and share repurchases[68](index=68&type=chunk) [Contingent Liabilities and Capital Commitments](index=26&type=section&id=Contingent%20Liabilities%20and%20Capital%20Commitments) As of June 30, 2025, the company had no significant contingent liabilities but had contracted capital commitments of 179.0 Million RMB not yet provided for, primarily for future investments in property, plant and equipment - As of June 30, 2025, the company had **no significant contingent liabilities**[69](index=69&type=chunk) - For the six months ended June 30, 2025, the Group had contracted capital commitments of **179.0 Million RMB** not yet provided for, primarily for future investments in property, plant and equipment[70](index=70&type=chunk) [Material Investments, Acquisitions and Disposals](index=26&type=section&id=Material%20Investments%2C%20Acquisitions%20and%20Disposals) As of the end of the reporting period, the Group had no material investments requiring disclosure, nor did it undertake any material acquisitions or disposals during the reporting period - As of the end of the reporting period, the Group had **no material investments** requiring disclosure[71](index=71&type=chunk) - During the reporting period, the Group undertook **no material acquisitions or disposals**[71](index=71&type=chunk) [Gearing Ratio](index=26&type=section&id=Gearing%20Ratio) As of June 30, 2025, the Group's gearing ratio increased from 1.3 as of December 31, 2024, to 1.4, primarily due to an increase in bank borrowings - The gearing ratio increased from **1.3 as of December 31, 2024, to 1.4 as of June 30, 2025**[72](index=72&type=chunk) - Primarily due to an **increase in bank borrowings**[72](index=72&type=chunk) [Other Important Information](index=26&type=section&id=Other%20Important%20Information) [Employees, Training and Remuneration Policies](index=26&type=section&id=Employees%2C%20Training%20and%20Remuneration%20Policies) As of June 30, 2025, the company had 2,661 employees, with product development, operations, sales, and marketing personnel accounting for the largest proportion; the company is committed to providing fair opportunities, competitive remuneration, and performance incentives, and enhances employee capabilities through onboarding and regular internal training, with total remuneration and benefits expenses of 336.4 Million RMB - As of June 30, 2025, the company had a total of **2,661 employees**, mostly located in Shenzhen, China[73](index=73&type=chunk) Number of Employees by Function | Function | Number of Employees | % of Total | | :--- | :--- | :--- | | Product Development, Operations, Sales & Marketing | 1,354 | 50.90% | | Procurement & Supply Chain Management | 463 | 17.40% | | Administration/Functional | 459 | 17.20% | | Warehousing/Production | 385 | 14.50% | | Total | 2,661 | 100% | - The company provides **competitive salaries, comprehensive insurance, and performance incentive plans**, offering onboarding training for new employees and customized internal training for existing employees[74](index=74&type=chunk) - For the six months ended June 30, 2025, total employee remuneration and benefits expenses amounted to **336.4 Million RMB**[75](index=75&type=chunk) [Use of Proceeds from Global Offering](index=27&type=section&id=Use%20of%20Proceeds%20from%20Global%20Offering) The company listed in November 2024, with net proceeds of approximately 387.5 Million HKD; given changes in tariff policies, the utilization period for the raised funds has been adjusted to before June 30, 2026, primarily for business expansion (80%), digitalization enhancement (5%), and working capital (15%); as of the end of the reporting period, 46.9 Million HKD had been utilized - The company was listed on the Main Board of the HKEX on **November 8, 2024**, with net proceeds of approximately **387.5 Million HKD**[76](index=76&type=chunk) - Given changes in tariff policies, the utilization period for the raised funds has been adjusted to **before June 30, 2026**[76](index=76&type=chunk) Use of Net Proceeds Plan | Item | Percentage | Amount for Related Use (Million HKD) | Amount Utilized During Reporting Period (Million HKD) | Amount Unutilized at End of Reporting Period (Million HKD) | Expected Timeline for Full Utilization of Unutilized Amount | | :--- | :--- | :--- | :--- | :--- | :--- | | Business Expansion | 80.0% | 310.0 | 42.0 | 268.0 | Before June 30, 2026 | | Enhance Digitalization and Further Improve Information Management Systems | 5.0% | 19.375 | 0 | 19.375 | Before June 30, 2026 | | Working Capital and General Corporate Purposes | 15.0% | 58.125 | 4.90 | 53.225 | Before June 30, 2026 | | Total | 100% | 387.5 | 46.9 | 340.6 | | [Interim Dividend](index=28&type=section&id=Interim%20Dividend) The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board of Directors does **not recommend** the payment of an interim dividend for the six months ended June 30, 2025[77](index=77&type=chunk) [Corporate Governance Practices](index=28&type=section&id=Corporate%20Governance%20Practices) The company has adopted the Corporate Governance Code as set out in Appendix C1 of the Listing Rules and complied with all applicable code provisions in the first half of 2025, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Lu Haichuan, which the Board believes facilitates consistent leadership and efficient decision-making and will be continuously reviewed - The company has adopted the principles and code provisions of the **Corporate Governance Code** as set out in Appendix C1 of the Listing Rules[78](index=78&type=chunk) - The roles of Chairman and Chief Executive Officer are combined and held by **Mr. Lu Haichuan**, deviating from Code Provision C.2.1, but the Board believes this facilitates consistent leadership and efficient strategic planning[78](index=78&type=chunk) - Except for the aforementioned deviation, the Board believes that the company has **complied with all applicable code provisions** of the Corporate Governance Code in the first half of 2025[79](index=79&type=chunk) [Securities Transactions and Share Movements](index=29&type=section&id=Securities%20Transactions%20and%20Share%20Movements) The company has adopted the Standard Code to regulate securities transactions by directors and employees; during the reporting period, the company did not purchase, sell, or redeem any listed securities, and 187,093,658 domestic unlisted shares were converted to H-shares and listed on the HKEX in May 2025, achieving "full circulation" [Standard Code for Securities Transactions](index=29&type=section&id=Standard%20Code%20for%20Securities%20Transactions) The company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules as a code of conduct for directors and employees who may possess inside information to deal in the company's securities; all directors have confirmed compliance with the code in the first half of 2025 - The company has adopted the **Standard Code** as set out in Appendix C3 of the Listing Rules to regulate securities transactions by directors and employees who may possess inside information[81](index=81&type=chunk) - All directors have confirmed **compliance with the Standard Code** in the first half of 2025[81](index=81&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=29&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) In the first half of 2025, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities, and as of June 30, 2025, the company held no treasury shares - In the first half of 2025, neither the company nor any of its subsidiaries **purchased, sold, or redeemed any of the company's listed securities**[82](index=82&type=chunk) - As of June 30, 2025, the company **did not hold any treasury shares**[82](index=82&type=chunk) ["Full Circulation" of Domestic Unlisted Shares](index=29&type=section&id=%22Full%20Circulation%22%20of%20Domestic%20Unlisted%20Shares) In May 2025, 187,093,658 domestic unlisted shares of the company were converted to H-shares and commenced trading on the HKEX from May 23, 2025, achieving "full circulation" - On May 13, 2025, the company converted **187,093,658 domestic unlisted shares into H-shares** and filed with the China Securities Regulatory Commission[83](index=83&type=chunk) - The HKEX granted approval for the listing and trading of these H-shares on **May 20, 2025**[83](index=83&type=chunk) - These converted H-shares commenced trading on the HKEX from **9:00 a.m. on May 23, 2025**[83](index=83&type=chunk) [Events After Reporting Period](index=29&type=section&id=Events%20After%20Reporting%20Period) No significant events have occurred for the Group from the end of the reporting period up to the date of this announcement - No significant events have occurred for the Group from the end of the reporting period up to the date of this announcement[84](index=84&type=chunk) [Audit Committee and Review](index=29&type=section&id=Audit%20Committee%20and%20Review) The company has established an Audit Committee comprising three independent non-executive directors, which has reviewed the Group's accounting principles and policies, as well as the interim results for the six months ended June 30, 2025; independent auditor Deloitte Touche Tohmatsu has reviewed the condensed consolidated interim financial information - The Audit Committee comprises **three independent non-executive directors**, with Ms. Meng Rongfang as Chairman[85](index=85&type=chunk) - The Audit Committee has reviewed the Group's **accounting principles and policies** and the **interim results** for the six months ended June 30, 2025[85](index=85&type=chunk) - Independent auditor **Deloitte Touche Tohmatsu** has reviewed the condensed consolidated interim financial information in accordance with Hong Kong Standard on Review Engagements 2410[86](index=86&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=30&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This interim results announcement has been published on the HKEX website and the company's website, and the interim report will be dispatched to shareholders and made available on the aforementioned websites when appropriate - This interim results announcement is published on the **HKEX website (www.hkexnews.hk)** and the **company's website (www.augroup.com)**[87](index=87&type=chunk) - The company's interim report for the six months ended June 30, 2025, will be dispatched to shareholders who require a printed copy and will be available on the aforementioned websites when appropriate[87](index=87&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。 Xin Point Holdings Limited 信邦控股有限公司 （於開曼群島註冊成立的有限公司） （股份代號：1571） 截 至 2025 年 6 月 30 日止六個月 中期業績公告 | 財務摘要 | | | | --- | --- | --- | | | | 截至6月30日止六個月 | | | 2025年 | 2024年 | | | 人民幣千元 | 人民幣千元 | | | （未經審核） | （未經審核） | | 收入 | 1,557,185 | 1,646,365 | | 母公司擁有人應佔溢利 | 241,716 | 322,155 | | 基本盈利 | 每股人民幣24.1分 | 每股人民幣32.1分 | | 攤薄盈利 | 每股人民幣24.1分 | 每股人民幣32.1分 | | 中期股息 | 每股20.0港仙 | 每股20.0港仙 | | | 於2025年6月30日 | 於2024年12月31 ...

[Financial Performance Overview](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%A5%AD%E7%B8%BE%E6%A6%82%E8%A6%BD) This section provides a high-level summary of the group's financial results, including income statement, comprehensive income, and balance sheet highlights [Condensed Consolidated Income Statement](index=1&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's revenue significantly increased to **HK$10.35 billion**, but loss attributable to equity holders expanded to **HK$2.62 billion** due to associate losses, asset impairment, and higher taxes | Indicator | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Revenue | 10,349,995 | 3,756,918 | 6,593,077 | +175.5% | | Gross Profit | 1,773,267 | 1,085,837 | 687,430 | +63.3% | | Operating Profit | 704,387 | 245,732 | 458,655 | +186.6% | | Loss Before Income Tax | (1,906,874) | (945,851) | (961,023) | +101.6% | | Interim Loss | (2,507,333) | (1,141,862) | (1,365,471) | +119.6% | | Loss Attributable to Equity Holders of the Company | (2,618,042) | (1,101,144) | (1,516,898) | +137.8% | | Basic and Diluted Loss Per Share (HK Cents) | (29.42) | (12.37) | (17.05) | +137.8% | [Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The Group's total comprehensive loss for the six months ended June 30, 2025, narrowed to **HK$1.57 billion**, primarily due to a positive foreign currency translation difference from overseas operations | Indicator | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | Change (HK$ Thousand) | | :--- | :--- | :--- | :--- | | Interim Loss | (2,507,333) | (1,141,862) | (1,365,471) | | Share of other comprehensive income of an associate | 1,238 | (117,511) | 118,749 | | Exchange differences on translation of overseas operations | 936,496 | (447,105) | 1,383,601 | | Total Comprehensive Loss for the Period | (1,569,599) | (1,706,478) | 136,879 | | Total Comprehensive Loss Attributable to Equity Holders of the Company | (1,786,071) | (1,622,390) | (163,681) | [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 total assets slightly decreased to **HK$167.83 billion**, total equity to **HK$43.74 billion**, and total liabilities also decreased, maintaining a relatively stable capital structure | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Total Assets | 167,828,420 | 171,169,614 | (3,341,194) | -1.95% | | Non-current Assets | 54,077,814 | 54,952,289 | (874,475) | -1.59% | | Current Assets | 113,750,606 | 116,217,325 | (2,466,719) | -2.12% | | Total Equity | 43,744,174 | 45,319,959 | (1,575,785) | -3.48% | | Total Liabilities | 124,084,246 | 125,849,655 | (1,765,409) | -1.40% | | Non-current Liabilities | 34,656,690 | 30,933,115 | 3,723,575 | +12.04% | | Current Liabilities | 89,427,556 | 94,916,540 | (5,488,984) | -5.78% | [Overall Performance](index=28&type=section&id=%E6%95%B4%E9%AB%94%E6%A5%AD%E7%B8%BE) In H1 2025, the Group's turnover surged by 175% to **HK$10.35 billion**, with gross profit of **HK$1.77 billion** and operating profit of **HK$0.70 billion**, yet loss attributable to equity holders reached **HK$2.62 billion** due to various adverse factors - In H1 2025, the Group's turnover reached **HK$10.35 billion**, a year-on-year increase of **175%**[64](index=64&type=chunk) - Gross profit was **HK$1.77 billion**, with an overall gross profit margin of **17.1%**[64](index=64&type=chunk) - Operating profit was **HK$0.70 billion**[64](index=64&type=chunk) - Loss attributable to equity holders of the Company was **HK$2.62 billion**, primarily impacted by declining gross profit margin, losses from associates, significant asset impairment provisions, and increased income tax expenses[64](index=64&type=chunk) - Excluding fair value changes of investment properties and financial assets, impairment of inventories, results of joint ventures and associates, and provisions, the loss attributable to equity holders of the Company was **HK$0.49 billion**[64](index=64&type=chunk) [Notes to the Financial Statements](index=6&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section details the accounting policies, segment information, revenue breakdown, expense analysis, and other financial disclosures supporting the consolidated financial statements [General Information and Basis of Preparation](index=6&type=section&id=%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99%E8%88%87%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) This section outlines Shenzhen Holdings Limited's basic information, business scope, holding structure, and the basis of preparation and accounting policies for the interim financial information, including the adoption of new standards - The Company is an investment holding company incorporated in Hong Kong, primarily engaged in property development, property investment, property management, and production operations[10](index=10&type=chunk) - The direct holding company is Shum Yip (Group) Company Limited, and the ultimate holding company is Shum Yip Group Co, Ltd[10](index=10&type=chunk) - The interim financial information is prepared in accordance with Hong Kong Accounting Standard 34 and should be read in conjunction with the 2024 annual consolidated financial statements[13](index=13&type=chunk) - The Group has adopted the amendments to Hong Kong Accounting Standard 21 "Lack of Exchangeability," which had no significant impact on the interim condensed consolidated financial information as the Group's transaction currencies are convertible[14](index=14&type=chunk) - Hong Kong Financial Reporting Standard 18, effective January 1, 2027, will introduce new requirements for profit or loss presentation, and the Group is currently assessing its impact on the financial statements[18](index=18&type=chunk) [Segment Information](index=8&type=section&id=%E5%88%86%E9%A1%9E%E8%B3%87%E6%96%99) The Group's operating segments include property development, investment, management, manufacturing, and other businesses, with property development revenue significantly increasing in H1 2025, despite negative impacts from investment property fair value changes and associate losses 2025 H1 Segment Revenue (HK$ Thousand) | Segment | Revenue from contracts with customers (recognized at a point in time) | Revenue from contracts with customers (recognized over time) | Rental income | Total Segment Revenue | Revenue from external customers | | :--- | :--- | :--- | :--- | :--- | :--- | | Property Development | 7,463,987 | – | – | 7,463,987 | 7,463,987 | | Property Investment | – | – | 656,308 | 656,308 | 647,266 | | Property Management | 9,443 | 1,667,508 | – | 1,676,951 | 1,593,777 | | Manufacturing | 231,863 | – | – | 231,863 | 231,863 | | Others | 167,517 | 262,415 | – | 429,932 | 413,102 | | **Total** | **7,872,810** | **1,929,923** | **656,308** | **10,459,041** | **10,349,995** | 2025 H1 Segment Results (HK$ Thousand) | Segment | Segment Results before fair value decrease of investment properties | Fair value changes of investment properties and loss on transfer to investment properties | Segment Results after fair value decrease of investment properties | | :--- | :--- | :--- | :--- | | Property Development | 459,737 | – | 459,737 | | Property Investment | 389,436 | (99,669) | 289,767 | | Property Management | 151,805 | – | 151,805 | | Manufacturing | 7,966 | – | 7,966 | | Others | (268,600) | – | (268,600) | | **Total** | **740,344** | **(99,669)** | **640,675** | - Share of results of joint ventures and associates (including impairment losses) was a loss of **HK$1.92 billion**, significantly impacting overall performance[20](index=20&type=chunk) [Revenue](index=11&type=section&id=%E6%94%B6%E7%9B%8A) The Group's revenue primarily derives from property sales, property management services, industrial product sales, and rental income, with property sales becoming the main revenue driver in H1 2025 due to substantial growth Revenue by Major Product and Service Line (HK$ Thousand) | Revenue Source | 2025 | 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Sales of properties | 7,463,987 | 1,017,626 | 6,446,361 | +633.5% | | Property management service income | 1,593,777 | 1,472,128 | 121,649 | +8.3% | | Sales of industrial products | 231,863 | 182,277 | 49,586 | +27.2% | | Others (from contracts with customers) | 413,102 | 408,825 | 4,277 | +1.0% | | **Total revenue from contracts with customers** | **9,702,729** | **3,080,856** | **6,621,873** | **+214.9%** | | Rental income | 647,266 | 676,062 | (28,796) | -4.3% | | **Total Revenue** | **10,349,995** | **3,756,918** | **6,593,077** | **+175.5%** | [Expense Analysis](index=11&type=section&id=%E8%B2%BB%E7%94%A8%E5%88%86%E6%9E%90) The Group's H1 2025 total expenses, including cost of sales, distribution, administrative, and other expenses, significantly increased, mainly due to higher cost of properties sold and inventories, while net finance costs and income tax expenses also rose Expenses by Nature (HK$ Thousand) | Expense Category | 2025 | 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Cost of properties sold and inventories | 6,602,696 | 641,072 | 5,961,624 | +930.0% | | Cost of services provided | 1,974,032 | 1,841,918 | 132,114 | +7.2% | | Employee benefit expenses | 393,049 | 441,525 | (48,476) | -11.0% | | Write-down of properties under development and completed properties held for sale | 186,422 | 188,091 | (1,669) | -0.9% | | Advertising and promotion expenses | 110,678 | 51,787 | 58,891 | +113.7% | | Depreciation of property, plant and equipment | 37,925 | 61,903 | (23,978) | -38.7% | | Other taxes and surcharges | 85,946 | 86,906 | (960) | -1.1% | | Others | 257,206 | 280,764 | (23,558) | -8.4% | | **Total** | **9,647,954** | **3,593,966** | **6,030,918** | **+167.8%** | Other Income (HK$ Thousand) | Income Source | 2025 | 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Government grants | 4,621 | 21,238 | (16,617) | -78.2% | | Interest income from joint ventures and a non-controlling interest | 87,252 | 82,140 | 5,112 | +6.2% | | **Total** | **108,875** | **116,476** | **(7,601)** | **-6.5%** | Net Finance Costs (HK$ Thousand) | Item | 2025 | 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Finance income (interest income from bank deposits) | (43,437) | (81,101) | 37,664 | -46.4% | | Total finance costs | 1,136,193 | 1,491,472 | (355,279) | -23.8% | | Less: Amount capitalized on qualifying assets | (405,068) | (769,222) | 364,154 | -47.3% | | **Net Finance Costs** | **687,688** | **641,149** | **46,539** | **+7.3%** | Income Tax Expense (HK$ Thousand) | Tax Category | 2025 | 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Current income tax | 651,848 | 240,372 | 411,476 | +171.2% | | Deferred income tax | (51,389) | (44,361) | (7,028) | +15.8% | | **Total** | **600,459** | **196,011** | **404,448** | **+206.3%** | - The statutory corporate income tax rate in mainland China is **25%**, and land appreciation tax is levied at progressive rates from **30% to 60%**[27](index=27&type=chunk) - The Group has recognized deferred income tax liabilities for withholding tax on planned profit distributions from certain PRC subsidiaries to offshore holding companies[28](index=28&type=chunk) [Loss Per Share and Dividends](index=14&type=section&id=%E6%AF%8F%E8%82%A1%E8%99%A7%E6%90%8D%E8%88%87%E8%82%A1%E6%81%AF) The Group's basic and diluted loss per share for H1 2025 expanded to **29.42 HK Cents**, and the Board resolved not to declare an interim dividend for the period ended June 30, 2025 Loss Per Share (HK Cents) | Indicator | 2025 | 2024 | Change (HK Cents) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Loss Attributable to Equity Holders of the Company (HK$ Thousand) | (2,618,042) | (1,101,144) | (1,516,898) | +137.8% | | Weighted average number of ordinary shares in issue | 8,898,793,115 | 8,898,793,115 | 0 | 0% | | Basic and Diluted Loss Per Share (HK Cents) | (29.42) | (12.37) | (17.05) | +137.8% | - The Board has resolved not to declare any interim dividend for the six months ended June 30, 2025[31](index=31&type=chunk)[101](index=101&type=chunk) - The 2023 final dividend of **7 HK Cents** per share, totaling approximately **HK$0.623 billion**, was paid on July 4, 2024[31](index=31&type=chunk) [Investments and Financial Assets](index=14&type=section&id=%E6%8A%95%E8%B3%87%E8%88%87%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) The Group's investments in associates significantly decreased, primarily due to a substantial impairment loss recognized on the investment in Road King Infrastructure Limited, while financial assets at fair value through profit or loss mainly comprise listed and unlisted equity investments in mainland China Investments in Associates (HK$ Thousand) | Item | June 30, 2025 | December 31, 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Beginning balance | 2,263,641 | 4,545,599 | (2,281,958) | -50.2% | | Share of results (including impairment losses) | (1,803,634) | (271,138) | (1,532,496) | +565.2% | | Ending balance | 470,123 | 4,154,746 | (3,684,623) | -88.7% | - Due to Road King Infrastructure Limited's debt default, the Group conducted an impairment test on its investment, recognizing a total share of results and impairment losses of **HK$1.806 billion**[32](index=32&type=chunk) - Non-current financial assets at fair value through profit or loss primarily include listed and unlisted equity investments in mainland China, totaling **HK$0.143 billion**[33](index=33&type=chunk) [Trade and Other Receivables and Payables](index=15&type=section&id=%E6%87%89%E6%94%B6%E8%88%87%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) The Group's total trade and other receivables increased, driven by growth in other receivables and prepayments, while total trade and other payables decreased, mainly due to reductions in trade payables and amounts due to non-controlling interests Trade and Other Receivables (HK$ Thousand) | Item | June 30, 2025 | December 31, 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Non-current: Other receivables – net | 684,787 | 661,023 | 23,764 | +3.6% | | Current: Trade receivables – net | 1,242,750 | 1,448,618 | (205,868) | -14.2% | | Current: Other receivables – net | 10,389,790 | 9,291,542 | 1,098,248 | +11.8% | | Current: Prepayments | 821,295 | 144,033 | 677,262 | +470.2% | | **Total** | **12,453,835** | **10,884,193** | **1,593,406** | **+14.6%** | - Current prepayments significantly increased, mainly due to prepayments for land acquisition rising from **HK$15,368 thousand** to **HK$626,818 thousand**[37](index=37&type=chunk) Trade and Other Payables (HK$ Thousand) | Item | June 30, 2025 | December 31, 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Trade payables | 5,182,559 | 5,803,323 | (620,764) | -10.7% | | Other payables and accrued expenses | 11,947,226 | 12,655,152 | (707,926) | -5.6% | | Other taxes payable | 178,290 | 361,191 | (182,901) | -50.6% | | **Total** | **17,308,075** | **18,819,666** | **(1,511,591)** | -8.0% | - Among trade payables, those due within one year accounted for the largest portion, at **HK$4.26 billion**[40](index=40&type=chunk) - Other payables and accrued expenses primarily include property buyer deposits and amounts due to the Group's joint ventures, fellow subsidiaries, and non-controlling interests[41](index=41&type=chunk) [Borrowings and Commitments](index=18&type=section&id=%E5%80%9F%E8%B2%B8%E8%88%87%E6%89%BF%E6%93%94) The Group's total bank and other borrowings remained stable, with an increased proportion of long-term borrowings, while it provides financial guarantees to property buyers and related parties and has capital commitments for land and property development costs Bank and Other Borrowings (HK$ Thousand) | Item | June 30, 2025 | December 31, 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Non-current borrowings | 27,159,952 | 22,804,481 | 4,355,471 | +19.1% | | Current borrowings | 10,028,586 | 14,560,568 | (4,531,982) | -31.1% | | **Total** | **37,188,538** | **37,365,049** | **(176,511)** | -0.5% | - Approximately **HK$8.19 billion** of loans are secured by certain assets of the Group, including properties under development, completed properties held for sale, and investment properties[38](index=38&type=chunk) - For the six months ended June 30, 2025, the average effective interest rate for bank and other borrowings was **3.58%** per annum, a decrease of **0.4 percentage points** from the same period last year[38](index=38&type=chunk) Capital Commitments (HK$ Thousand) | Commitment Category | June 30, 2025 | December 31, 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Commitments for acquisition of land and buildings and development costs of properties under development | 7,443,206 | 7,144,700 | 298,506 | +4.2% | | Uncalled capital commitments to Shenzhen King Infrastructure Co, Ltd | 1,450,000 | 1,542,500 | (92,500) | -6.0% | Financial Guarantees (HK$ Thousand) | Guarantee Category | June 30, 2025 | December 31, 2024 | Change (HK$ Thousand) | Change Rate | | :--- | :--- | :--- | :--- | :--- | | Financial guarantees provided to property buyers of the Group for mortgages | 13,611,249 | 13,070,659 | 540,590 | +4.1% | | Financial guarantees provided to related parties of the Group | 869,878 | 1,445,322 | (575,444) | -39.8% | | Financial guarantees provided for loans to relocated parties of urban renewal projects | 325,164 | 323,381 | 1,783 | +0.6% | [Share Capital](index=20&type=section&id=%E8%82%A1%E6%9C%AC) As of June 30, 2025, the number of issued and fully paid ordinary shares and the amount of share capital remained unchanged from December 31, 2024 Share Capital (HK$ Thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Issued and fully paid ordinary shares (shares) | 8,898,793,115 | 8,898,793,115 | | Share capital amount | 22,071,756 | 22,071,756 | [Operating Review and Outlook](index=22&type=section&id=%E7%B6%93%E7%87%9F%E5%9B%9E%E9%A1%A7%E8%88%87%E5%B1%95%E6%9C%9B) This section reviews the Group's H1 operating achievements, outlines H2 plans to stabilize performance, and discusses its strategic transformation towards asset management and urban comprehensive operations [Review of H1 Operating Performance](index=22&type=section&id=%E4%B8%8A%E5%8D%8A%E5%B9%B4%E7%B6%93%E7%87%9F%E5%B7%A5%E4%BD%9C%E5%9B%9E%E9%A1%A7) In H1 2025, the Group achieved solid results in transformation and business development, with significant revenue growth, outperforming property sales, stable property leasing and urban comprehensive operations, and orderly progress in technology industry investments, despite negative impacts from associate losses and asset impairment - H1 operating revenue was **HK$10.35 billion**, a year-on-year increase of **175%**; gross profit was **HK$1.77 billion**, up **63%** year-on-year; operating profit was **HK$0.70 billion**[49](index=49&type=chunk) - Loss attributable to equity holders of the Company was **HK$2.62 billion**, mainly due to losses from associates, significant asset impairment provisions, and increased tax expenses[49](index=49&type=chunk) - Property contracted sales were approximately **RMB 6.8 billion** (approximately **HK$7.4 billion**), a year-on-year increase of **10%**, outperforming the national new home sales decline of **5.5%**[50](index=50&type=chunk) - Development revenue recognized was approximately **HK$7.46 billion**, a significant increase of **633%** from the same period last year; development gross profit margin was **14%**, a year-on-year decrease of **18 percentage points**[50](index=50&type=chunk) - Investment property income was approximately **HK$0.65 billion**, with an overall occupancy rate maintained at **90%**, outperforming market levels[51](index=51&type=chunk) - Property management income was approximately **HK$1.59 billion**, up **8%** from the same period last year, with a net expansion of **3.11 million sq.m.** in operating area[52](index=52&type=chunk) - Hotel operation income was approximately **HK$0.21 billion**, a **3%** increase from the same period last year, with a total of **8** hotels in operation or under management, and **9** more under construction[52](index=52&type=chunk) - Advanced manufacturing business revenue and net profit increased by **27%** and **106%** respectively year-on-year. Modern agriculture revenue grew by **108%**, with agricultural products sold to Hong Kong for the first time[53](index=53&type=chunk) - Successfully arranged and replaced a **HK$4.0 billion** syndicated loan, reducing HKD-denominated net debt by **HK$0.7 billion**, and administrative expenses decreased by **18%** compared to the same period last year[54](index=54&type=chunk) - Full impairment provisions have been made for the long-term equity investment in Road King Infrastructure Limited, which will not have a significant impact on the Group's future performance[54](index=54&type=chunk) [H2 Operating Plan](index=24&type=section&id=%E4%B8%8B%E5%8D%8A%E5%B9%B4%E7%B6%93%E7%87%9F%E8%A8%88%E5%8A%83) The Group will focus on "stabilizing performance" in H2 by accelerating property sales, enhancing real estate asset management, strengthening urban comprehensive operations, actively advancing strategic resource implementation, and reinforcing financial risk control to achieve full-year targets - Accelerate property sales and destocking through differentiated strategies, focusing on key projects, maintaining sales velocity for high-traffic projects, targeting new market entries, and rigorously managing inventory to optimize inventory structure[55](index=55&type=chunk) - Enhance real estate asset management by strengthening leasing and operations, optimizing rental strategies, promoting renovation and upgrading of older properties, and proactively planning for major ongoing projects[56](index=56&type=chunk) - Strengthen urban comprehensive operation businesses by expanding property operation scale through various means, improving management efficiency and profitability; commercial operations will enhance scalable replication capabilities to ensure timely opening of major projects; hotel operations will leverage resource integration to expand scale and improve operational efficiency[57](index=57&type=chunk) - Actively advance strategic resource implementation, prudently promote integrated benefit and urban renewal projects, and closely monitor market opportunities to expand market share[57](index=57&type=chunk) - Strengthen financial risk control, continue to reduce HKD-denominated debt, optimize debt maturity structure, strictly control investment standards, and ensure efficient capital allocation and stable returns[58](index=58&type=chunk) [Transformation Strategy](index=26&type=section&id=%E8%BD%89%E5%9E%8B%E6%88%B0%E7%95%A5%E6%80%9D%E8%80%83) Facing the shift from incremental expansion to existing asset renewal in the real estate market, the Group will accelerate business transformation, build new business models focused on real estate asset management and comprehensive operations, and develop technology industry investment services to achieve sustainable growth and long-term shareholder returns - China's urbanization is transitioning from rapid growth to stable development, with urban development shifting from large-scale incremental expansion to existing asset quality improvement, eliminating the basis for large-scale real estate expansion[59](index=59&type=chunk) - The Group will transform into a "real estate asset management and comprehensive operation service provider," gradually reducing the proportion of development business, expanding real estate management scale, enhancing operational service capabilities, and building a full-cycle asset management system encompassing investment, financing, construction, management, and exit[59](index=59&type=chunk) - Over the next three years, flagship projects and high-end hotels will commence operations, continuously optimizing the asset portfolio, strategically investing in high-quality operational real estate when appropriate, and developing agency construction services[60](index=60&type=chunk) - Strengthen real estate operation and management, providing high-quality services aligned with consumption trends and industry demands, enhancing rental returns and asset operating efficiency through refined operations, and deepening brand output and model innovation[61](index=61&type=chunk) - Build a closed-loop real estate capital system, engaging in real estate fund management, expanding diversified financing channels, and promoting the securitization of mature assets through REITs and other means to achieve capital recovery and premium exit[61](index=61&type=chunk) - Develop technology industry investment service capabilities, building a business matrix of "industrial space + technology services + investment incubation," focusing on technology sectors, improving park efficiency, and strengthening incubation and investment capabilities for technology enterprises[62](index=62&type=chunk) [Business Segment Details](index=28&type=section&id=%E6%A5%AD%E5%8B%99%E6%9D%BF%E5%A1%8A%E8%A9%B3%E6%83%85) This section provides detailed performance reviews for each of the Group's core business segments, including property development, property investment, urban comprehensive operations, advanced manufacturing, and agricultural operations [Property Development Business](index=28&type=section&id=%E7%89%A9%E6%A5%AD%E9%96%8B%E7%99%BC%E6%A5%AD%E5%8B%99) In H1 2025, the Group's property development business saw a **633%** surge in recognized sales revenue to **HK$7.46 billion**, with contracted sales increasing by **10%** to **HK$7.39 billion**, while new construction and completed areas both reached approximately **0.37 million sq.m.**, and land reserves remained healthy with **69%** in the Greater Bay Area - In H1, recognized property sales area was approximately **0.292 million sq.m.**, a year-on-year increase of approximately **439%**; recognized sales revenue was approximately **HK$7.46 billion**, a year-on-year increase of approximately **633%**[65](index=65&type=chunk) - The gross profit margin for real estate development sales was **13.8%**, a decrease of **18 percentage points** from the same period last year[65](index=65&type=chunk) - H1 contracted sales amounted to approximately **RMB 6.81 billion** (approximately **HK$7.39 billion**), a year-on-year increase of **10%**; contracted sales area was approximately **0.300 million sq.m.**, a year-on-year increase of **26%**[68](index=68&type=chunk) - Projects in the Guangdong-Hong Kong-Macao Greater Bay Area accounted for **80%** of contracted sales value, with residential products accounting for **88%**[68](index=68&type=chunk) - In H1, new construction area was approximately **0.370 million sq.m.**, and completed area was approximately **0.373 million sq.m.**[72](index=72&type=chunk) - As of June 30, 2025, the Group's land reserve had a total planned GFA of approximately **6.025 million sq.m.**, of which **69%** is located in the Greater Bay Area[75](index=75&type=chunk) - The second phase of Shenzhen Chegongmiao First Urban Renewal Unit project completed the land contract signing for the South plot, with a land price of approximately **RMB 1.1 billion** and a total GFA of **0.488 million sq.m.**, to be developed into a TOD urban complex[75](index=75&type=chunk) [Property Investment Business](index=34&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87%E6%A5%AD%E5%8B%99) In H1 2025, the Group's property investment income was approximately **HK$0.65 billion**, with a gross profit margin of **70.1%**, maintaining an overall occupancy rate of **90%** despite market downturns, and enhancing asset value and rental income through property upgrades and refined operations - H1 property investment income was approximately **HK$0.65 billion**, with a property investment business gross profit margin of approximately **70.1%**[79](index=79&type=chunk) - As of June 30, 2025, the total area of investment properties was approximately **1.734 million sq.m.**, with a fair value of approximately **HK$33.50 billion**[79](index=79&type=chunk) - The overall occupancy rate was **90%**, with rental increases of up to **180%** achieved through renovation and upgrading of older properties[79](index=79&type=chunk) - Shenye Shangcheng office building pioneered the "0-cost fitted-out delivery" model, securing **7** new corporate clients against market trends, with **13** Fortune Global 500 companies, maintaining its position as second in Shenzhen[79](index=79&type=chunk) [Urban Comprehensive Operation Business](index=34&type=section&id=%E5%9F%8E%E5%B8%82%E7%B6%9C%E5%90%88%E9%81%8B%E7%87%9F%E6%A5%AD%E5%8B%99) The Group's urban comprehensive operation business generated approximately **HK$1.59 billion** in H1 revenue, up **8%** year-on-year, with a gross profit margin of **15.0%**, expanding property management area by **3.11 million sq.m.**, launching a "3+X" commercial strategy with **29%** sales growth, and increasing hotel operation revenue by **3%** while expanding its scale - H1 property management business income was approximately **HK$1.59 billion**, up **8%** from the same period last year, with a gross profit margin of approximately **15.0%**[80](index=80&type=chunk) - Contracted management area was approximately **105.85 million sq.m.**, and managed area was approximately **102.40 million sq.m.**, with independent third-party projects accounting for approximately **81%** and non-residential formats for approximately **71%**[80](index=80&type=chunk) - Shenye Operations net expanded managed area by approximately **3.11 million sq.m.**, with total contract value of **RMB 0.41 billion**, achieving continuous breakthroughs in urban property management and public building property sectors[81](index=81&type=chunk) - Launched the "3+X" commercial product line strategy, opened **77** new stores, with Shenye Shangcheng's footfall exceeding **20 million**, and sales increasing by **29%** year-on-year[82](index=82&type=chunk) - Hotel operating income was approximately **HK$0.21 billion**, up **3%** from the same period last year, with a gross profit margin of approximately **22.9%**, a year-on-year increase of **8.7 percentage points**[83](index=83&type=chunk) - The total number of hotels under operation, management, and planning is **17**, of which **8** are already in operation[83](index=83&type=chunk) - Shenzhen Mandarin Oriental Hotel's room revenue ranked first in the Shenzhen luxury hotel competitive set, and Wuyishan Jingju Resort Hotel successfully opened[83](index=83&type=chunk) [Advanced Manufacturing Business](index=37&type=section&id=%E5%85%88%E9%80%B2%E8%A3%BD%E9%80%A0%E6%A5%AD%E5%8B%99) The Group's advanced manufacturing business achieved **HK$0.23 billion** in H1 revenue, up **27%** year-on-year, with a gross profit margin of **26.2%**, as its subsidiary Jinghua Company, a national "specialized and new small giant" enterprise, saw a **25%** increase in shipments, optimized cost control, and continued R&D efforts - H1 manufacturing business income was **HK$0.23 billion**, up **27%** year-on-year, with a gross profit margin of approximately **26.2%**, a year-on-year increase of **1.9 percentage points**[88](index=88&type=chunk) - Jinghua Company's shipments increased by **25%** compared to the same period last year, inventory decreased by **17%**, and **2** invention patents were applied for and **1** invention patent was granted in H1[88](index=88&type=chunk) [Agricultural Operations Business](index=38&type=section&id=%E8%BE%B2%E6%A5%AD%E7%B6%93%E7%87%9F%E6%A5%AD%E5%8B%99) The Group's agricultural operations business generated approximately **HK$0.14 billion** in H1 revenue, a significant **108%** year-on-year increase, with a gross profit margin of **3.1%**, achieving a "zero breakthrough" in agricultural product exports and stable operation of agri-tourism projects - H1 agricultural operations income was approximately **HK$0.14 billion**, a significant year-on-year increase of **108%**, with a gross profit margin of approximately **3.1%**, a year-on-year increase of **5.2 percentage points**[89](index=89&type=chunk) - Frozen pork was supplied to Hong Kong for the first time, achieving a "zero breakthrough" in agricultural product exports[89](index=89&type=chunk) - The project matrix of "3 Four Seasons Gardens + 2 Four Seasons Flower Valleys" has largely taken shape, with Shenzhen Dapeng Four Seasons Coastal Garden focusing on research and study tourism, and Nanao Four Seasons Garden Homestay gaining market recognition[89](index=89&type=chunk) [Financial and Other Matters](index=38&type=section&id=%E8%B2%A1%E5%8B%99%E8%88%87%E5%85%B6%E4%BB%96%E4%BA%8B%E9%A0%85) This section covers the Group's financial management, including successful syndicated loan refinancing, debt structure, and the impact of exchange rate fluctuations, alongside other significant items such as increased other expenses, associate performance, asset pledges, and legal proceedings [Financial Management Overview](index=38&type=section&id=%E8%B2%A1%E5%8B%99%E7%AE%A1%E7%90%86%E6%83%85%E6%B3%81) The Group successfully refinanced a **HK$4.0 billion** syndicated loan, optimizing its capital structure, with total bank and other borrowings at **HK$37.19 billion** and a net gearing ratio of **73.0%** as of June 30, 2025, while administrative expenses decreased by **18%** through lean management - Successfully arranged and replaced a **HK$4.0 billion** syndicated loan, ensuring capital security[90](index=90&type=chunk) Funding and Financing Situation (HK$ Billion) | Item | June 30, 2025 | December 31, 2024 | Change (HK$ Billion) | | :--- | :--- | :--- | :--- | | Bank loans and other borrowings | 37.19 | 37.37 | (0.18) | | – Long-term borrowings | 27.16 | 22.81 | 4.35 | | – Short-term borrowings | 10.03 | 14.56 | (4.53) | | Cash (including restricted cash) | 10.35 | 11.80 | (1.45) | | Net gearing ratio | 73.0% | 66.3% | +6.7% | - The proportion of floating-rate borrowings and fixed-rate borrowings was **68%** and **32%** respectively; the proportion of long-term borrowings and short-term borrowings was **73%** and **27%** respectively[90](index=90&type=chunk) - The proportion of HKD-denominated borrowings and RMB-denominated borrowings was **38%** and **62%** respectively[90](index=90&type=chunk) - The depreciation of the RMB exchange rate led to a **HK$0.94 billion** fluctuation in RMB assets and earnings relative to HKD, recognized in other comprehensive income[92](index=92&type=chunk) - Administrative expenses decreased by **18%** compared to the same period last year, saving approximately **HK$0.11 billion** in expenses[93](index=93&type=chunk) [Other Significant Matters](index=39&type=section&id=%E5%85%B6%E4%BB%96%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A0%85) The Group's other expenses significantly increased in H1, mainly due to inventory impairment provisions, with major joint ventures and associates, particularly Road King Infrastructure, performing poorly and incurring substantial losses, while the Group has asset-backed loans and financial guarantees, and faces a lawsuit of approximately **RMB 0.22 billion** - In H1 2025, other expenses were approximately **HK$0.34 billion**, a year-on-year increase of **113%**, primarily due to inventory impairment provisions of approximately **HK$0.19 billion**[94](index=94&type=chunk) - The performance of major joint ventures and associates was unsatisfactory, with Road King Infrastructure Limited contributing a loss (including impairment losses) of approximately **HK$1.81 billion**[95](index=95&type=chunk) - The Group's remaining book value of equity in Road King Infrastructure is approximately **HK$0.17 billion**, which fairly reflects its market value, and future performance will not have a significant negative impact[96](index=96&type=chunk) - As of June 30, 2025, the Group had asset-backed loans totaling **HK$8.19 billion** and provided guarantees totaling **HK$0.87 billion**[97](index=97&type=chunk)[98](index=98&type=chunk) - Shenye Tairan Company faces a lawsuit of approximately **RMB 0.22 billion**, which is currently under trial, and the Company is assessing its financial impact[99](index=99&type=chunk) - As of June 30, 2025, the Group employed a total of **20,261** employees, with total remuneration of approximately **RMB 1.228 billion**[100](index=100&type=chunk) [Corporate Governance](index=41&type=section&id=%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86) This section addresses the Group's adherence to corporate governance principles, including the decision not to declare an interim dividend, compliance with the Corporate Governance Code, the composition and review activities of the Audit Committee, and the absence of securities transactions [Interim Dividends](index=41&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board of Directors has resolved not to declare any interim dividend for the six months ended June 30, 2025 - The Board has resolved not to declare any interim dividend for the six months ended June 30, 2025[101](index=101&type=chunk) [Corporate Governance](index=41&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Company complied with the Corporate Governance Code during the reporting period, though the Chairman and CEO roles are temporarily held by the same individual, and the company is seeking a suitable candidate to meet code requirements - The Company has applied and complied with the principles and all code provisions of the Corporate Governance Code set out in Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[102](index=102&type=chunk) - Mr. Wang Yuwen continued to serve as the Company's President after assuming the role of Chairman of the Board on April 29, 2025; this arrangement deviates from Code Provision C.2.1 but is temporary, and the Company is seeking a suitable candidate[102](index=102&type=chunk) [Audit Committee](index=41&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, comprising three independent non-executive directors, has reviewed the Group's adopted accounting principles and practices, and the unaudited condensed consolidated financial information for the six months ended June 30, 2025 - The Audit Committee comprises three independent non-executive directors: Mr. Li Wai Keung, Dr. Wong Yau Kar, and Professor Gong Peng[103](index=103&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and the unaudited condensed consolidated financial information for the six months ended June 30, 2025[103](index=103&type=chunk) [Securities Transactions](index=42&type=section&id=%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) 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[104](index=104&type=chunk) [Acknowledgements](index=42&type=section&id=%E9%B3%A5%E8%AC%9D) The Board of Directors expresses sincere gratitude to investors, shareholders, fellow directors, and all employees for their trust, support, diligent work, loyal service, and contributions during the reporting period - The Board expresses its sincere gratitude to the Group's investors and shareholders for their trust and support, and to fellow directors and all employees of the Group for their diligent work, loyal service, and contributions during the six months ended June 30, 2025[105](index=105&type=chunk)

[Interim Results Summary](index=1&type=section&id=Summary) The Group's revenue significantly decreased by **54.3%** year-on-year in the first half of 2025, primarily due to customer project delays, leading to a net loss compared to a profit in the prior period - In the first half of 2025, the Group's revenue significantly decreased by **54.3%** year-on-year, primarily due to customers postponing certain major projects to the second half of 2025[2](index=2&type=chunk) - The Group recorded a net loss in the first half of 2025, transitioning from a profit after tax in the first half of 2024, for the same reasons as the revenue decrease[2](index=2&type=chunk) Key Financial Summary for H1 2025 (THB thousands) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 30,400 | 66,400 | -54.3% | | Profit/(Loss) After Tax | (45,700) | 1,200 | N/A (Turned to Loss) | [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) In the first half of 2025, the Group's revenue significantly decreased by **54.3%** to THB 30.4 million, leading to a substantial decline in gross profit and margin, and ultimately a net loss of THB 45.7 million Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (THB thousands) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 30,399 | 66,454 | | Cost of sales and services | (25,636) | (49,931) | | Gross profit | 4,763 | 16,523 | | Other income and net gains | 21,656 | 35,921 | | Selling and distribution expenses | (1,593) | (2,778) | | Administrative expenses | (50,388) | (23,987) | | Loss on disposal of a subsidiary | (1,147) | – | | Finance costs | (19,023) | (23,017) | | Loss (profit) before tax | (45,732) | 1,201 | | Loss (profit) for the period attributable to owners of the Company | (45,732) | 1,201 | | Total comprehensive (expense) income | (43,651) | 1,201 | | Basic and diluted loss (profit) per share (Thai Baht cents) | (6.18) | 0.20 | [Condensed Consolidated Statement of Financial Position](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets and liabilities decreased, primarily due to the disposal of right-of-use assets and reductions in trade receivables, finance lease receivables, trade payables, and bank borrowings Condensed Consolidated Statement of Financial Position (THB thousands) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Non-current assets** | | | | Leasehold improvements and equipment | 9,372 | 9,621 | | Right-of-use assets | 3,554 | 44,777 | | Total non-current assets | 362,136 | 392,330 | | **Current assets** | | | | Inventories | 93,024 | 93,043 | | Trade receivables | 184,094 | 289,540 | | Cash and cash equivalents | 80,435 | 74,747 | | Total current assets | 668,817 | 844,656 | | **Current liabilities** | | | | Trade payables | 318,734 | 413,001 | | Bank and other borrowings | 99,966 | 124,372 | | Total current liabilities | 542,596 | 660,390 | | **Non-current liabilities** | | | | Bank and other borrowings | 120,818 | 136,836 | | Total non-current liabilities | 164,123 | 212,219 | | **Equity** | | | | Total equity | 324,234 | 364,377 | [Condensed Consolidated Statement of Changes in Equity](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) In the first half of 2025, the Group's total equity decreased due to the loss and total comprehensive expense for the period, partially offset by new share placements, while non-controlling interests became zero due to a subsidiary disposal Condensed Consolidated Statement of Changes in Equity (THB thousands) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total equity at beginning of period | 364,377 | 477,489 | | Loss for the period | (45,732) | 1,201 | | Total comprehensive (expense) income | (43,651) | 1,201 | | New share placement | 40,334 | – | | Disposal of a subsidiary | (36,826) | – | | Total equity at end of period | 324,234 | 364,377 | [Condensed Consolidated Statement of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) In the first half of 2025, the Group experienced increased cash inflow from operating activities, a higher net cash outflow from investing activities, and a slight reduction in net cash outflow from financing activities, resulting in a net increase of THB 3.5 million in cash and cash equivalents Condensed Consolidated Statement of Cash Flows (THB thousands) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Cash generated from operations | 38,116 | 23,736 | | Net cash flow (used in) from investing activities | (9,297) | 333 | | Net cash flow used in financing activities | (19,862) | (20,582) | | Net increase in cash and cash equivalents | 3,487 | 8,957 | | Cash and cash equivalents at beginning of period | 55,003 | (6,550) | | Cash and cash equivalents at end of period | 63,960 | (3,063) | [Notes to the Condensed Consolidated Interim Financial Information](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Information) [1. Company and Group Information](index=8&type=section&id=1.%20Company%20and%20Group%20Information) Platt Nera International Limited, incorporated in the Cayman Islands and listed on the Hong Kong Stock Exchange, primarily provides IT integration solutions, IT support services, and equipment sales in Thailand - The Company is incorporated in the Cayman Islands, and its shares are listed on the Main Board of the Hong Kong Stock Exchange[10](index=10&type=chunk) - The Group is principally engaged in providing IT integration solutions, IT support services, and selling equipment in Thailand[10](index=10&type=chunk) [2. Basis of Presentation and Preparation](index=8&type=section&id=2.%20Basis%20of%20Presentation%20and%20Preparation) The interim financial information is unaudited, prepared in accordance with Appendix 16 of the Listing Rules and International Financial Reporting Standards, presented at historical cost, and reported in Thai Baht - The condensed consolidated interim financial information is unaudited and prepared in accordance with the applicable disclosure requirements of Appendix 16 to the Listing Rules[11](index=11&type=chunk) - The accounting policies and basis of preparation used are consistent with the 2024 annual financial statements prepared in accordance with International Financial Reporting Standards[11](index=11&type=chunk) - The financial statements are presented in Thai Baht, with all values rounded to the nearest thousand[11](index=11&type=chunk) [3. Segment Information](index=8&type=section&id=3.%20Segment%20Information) The Group's operations are concentrated in a single segment: IT integration solutions, IT support services, and equipment sales, with all revenue and non-current assets derived from Thailand - The Group's revenue, reported results, and total assets are generated from a single operating segment, which is the provision of IT integration solutions, IT support services, and the sale of equipment[12](index=12&type=chunk) - All of the Group's revenue is derived from external customers in Thailand, and all non-current assets are located in Thailand[13](index=13&type=chunk) Revenue Contribution from Major Customers (THB thousands) | Customer | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Customer A | 9,466 | 11,046 | | Customer B | 7,201 | 19,910 | | Customer C | 4,956 | 2,167 | [4. Revenue from Contracts with Customers](index=9&type=section&id=4.%20Revenue%20from%20Contracts%20with%20Customers) The Group's total revenue from customer contracts significantly decreased from THB 66.45 million in the first half of 2024 to THB 30.40 million in the first half of 2025, primarily due to reduced IT support service revenue, despite growth in IT integration solutions - The Group is principally engaged in providing IT integration solutions and IT support services, and selling equipment in Thailand[15](index=15&type=chunk) Revenue from Contracts with Customers by Type (THB thousands) | Revenue Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | IT integration solutions | 18,128 | 12,111 | | IT support services | 9,935 | 54,343 | | Sale of equipment | 2,336 | – | | **Total revenue from contracts with customers** | **30,399** | **66,454** | | Transferred at a point in time | 6,378 | 2,247 | | Transferred over time | 24,021 | 64,207 | - Contract assets represent the Group's right to consideration in exchange for goods or services that the Group has transferred to a customer, where that right is conditioned on something other than the passage of time[17](index=17&type=chunk) [5. Loss (Profit) Before Tax](index=11&type=section&id=5.%20Loss%20%28Profit%29%20Before%20Tax) The Group recorded a loss before tax of THB 45.73 million in the first half of 2025, compared to a profit of THB 1.20 million in the same period last year, with total employee costs decreasing but depreciation expenses significantly increasing Components of Loss (Profit) Before Tax (THB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total employee benefit expenses | 17,925 | 24,070 | | Less: Amount capitalised in cost of services provided | (6,101) | (9,782) | | Cost of services provided | 25,636 | 49,931 | | Depreciation of leasehold improvements and equipment | 1,891 | 157 | | Depreciation of right-of-use assets | 5,546 | 1,939 | | Amortisation of computer software | 32 | 32 | [6. Income Tax](index=11&type=section&id=6.%20Income%20Tax) No income tax expense was provided as the Group had no assessable profits in both the first half of 2025 and 2024 - No income tax expense was provided as the Group had no assessable profits in both the first half of 2025 and 2024[20](index=20&type=chunk) [7. Interim Dividend](index=11&type=section&id=7.%20Interim%20Dividend) The Board of Directors did not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Directors did not recommend the payment of an interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[21](index=21&type=chunk) [8. Loss Per Share Attributable to Owners of the Company](index=12&type=section&id=8.%20Loss%20Per%20Share%20Attributable%20to%20Owners%20of%20the%20Company) In the first half of 2025, basic loss per share attributable to owners of the Company was **6.18 Thai Baht cents**, compared to a profit of **0.20 Thai Baht cents** per share in the prior period, mainly due to the loss for the period and an increased weighted average number of ordinary shares outstanding Calculation of Loss (Profit) Per Share | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss (profit) for the period attributable to owners of the Company | THB 45,732,000 (Loss) | THB 1,201,000 (Profit) | | Weighted average number of ordinary shares outstanding during the period | 740,000,000 shares | 600,000,000 shares | | Basic and diluted loss (profit) per share (Thai Baht cents) | (6.18) | 0.20 | [9. Leases](index=12&type=section&id=9.%20Leases) As a lessor, the Group's finance lease receivables decreased, while as a lessee, right-of-use assets and lease liabilities significantly declined due to the disposal of a subsidiary - As a lessor, the Group's finance lease receivables relate to finance lease arrangements for providing passbook machines, with a 5-year lease term and an annual interest rate of **1.85%**[23](index=23&type=chunk) Finance Lease Receivables (THB thousands) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Within one year | 15,184 | 31,599 | | After one year but within two years | – | 382 | | Non-current portion | – | 382 | Changes in Right-of-Use Assets and Lease Liabilities (THB thousands) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Carrying amount of right-of-use assets at end of period | 3,554 | 44,777 | | Carrying amount of lease liabilities at end of period | 3,796 | 44,815 | | Non-current portion of lease liabilities | – | 3,796 | [10. Trade Receivables](index=14&type=section&id=10.%20Trade%20Receivables) The Group's total trade receivables decreased from THB 294.69 million as of December 31, 2024, to THB 184.09 million as of June 30, 2025, primarily due to a significant reduction in unbilled amounts - Trade terms are primarily on credit, with a credit period generally ranging from **7 to 30 days** from the invoice date[26](index=26&type=chunk) - Trade receivables are non-interest bearing, but an amount of **THB 125.64 million** includes a significant financing component to be settled within five years[27](index=27&type=chunk) Ageing Analysis of Trade Receivables (THB thousands) | Ageing | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Within one month | 1,592 | 9,657 | | One to three months | 6,479 | 479 | | Three to six months | 215 | 3,565 | | Over six months | 40,671 | 37,157 | | Unbilled | 135,137 | 243,831 | | **Total trade receivables** | **184,094** | **294,689** | [11. Prepayments, Other Receivables and Other Assets](index=15&type=section&id=11.%20Prepayments%2C%20Other%20Receivables%20and%20Other%20Assets) Total prepayments, other receivables, and other assets decreased from THB 223.36 million as of December 31, 2024, to THB 150.38 million as of June 30, 2025, mainly due to a significant reduction in deposits paid for equipment Components of Prepayments, Other Receivables and Other Assets (THB thousands) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Contract costs | 50,517 | 32,537 | | Prepayments | 9,494 | 57,027 | | Deposits paid for equipment | – | 101,468 | | Interest receivables | 812 | 788 | | Deposits and other receivables | 68,584 | 11,453 | | VAT receivables | 18,348 | 17,898 | | Others | 3,827 | 3,387 | | **Total** | **151,582** | **224,558** | | Less: Impairment | (1,200) | (1,200) | | **Net amount** | **150,382** | **223,358** | [12. Pledged Bank Deposits and Cash and Cash Equivalents](index=16&type=section&id=12.%20Pledged%20Bank%20Deposits%20and%20Cash%20and%20Cash%20Equivalents) As of June 30, 2025, the Group's total cash and bank balances were THB 164.05 million, of which THB 83.62 million were pledged bank deposits used for bank guarantees, loans, and overdrafts, with annual interest rates ranging from **0.8% to 1.15%** Cash and Bank Balances (THB thousands) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and bank balances (excluding time deposits) | 80,435 | 74,747 | | Time deposits | 83,618 | 72,804 | | **Total cash and bank balances** | **164,053** | **147,551** | | Less: Pledged bank deposits | (83,618) | (72,804) | | **Cash and cash equivalents** | **80,435** | **74,747** | - The pledged deposits bear annual interest rates ranging from **0.8% to 1.15%**[31](index=31&type=chunk) - Pledged bank deposits serve as collateral for bank guarantees, letters of credit, and bank loans and overdrafts[34](index=34&type=chunk) [13. Trade Payables](index=16&type=section&id=13.%20Trade%20Payables) The Group's total trade payables decreased from THB 418.05 million as of December 31, 2024, to THB 318.73 million as of June 30, 2025, primarily due to a reduction in unbilled amounts - Trade payables are unsecured, non-interest bearing, and generally settled within **30 to 60 days**[32](index=32&type=chunk) Ageing Analysis of Trade Payables (THB thousands) | Ageing | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Invoiced within one month | 30,265 | 54,760 | | One to two months | 20,277 | 4,006 | | Two to three months | 3,117 | 4,205 | | Over three months | 140,247 | 132,761 | | Unbilled | 124,828 | 222,322 | | **Total** | **318,734** | **418,054** | [14. Bank and Other Borrowings](index=17&type=section&id=14.%20Bank%20and%20Other%20Borrowings) The Group's total bank and other borrowings decreased from THB 261.21 million as of December 31, 2024, to THB 220.78 million as of June 30, 2025, mainly due to the repayment of bank loans and other loans Components of Bank and Other Borrowings (THB thousands) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Bank overdrafts (secured) | 16,475 | 19,744 | | Bank loans (secured) | 51,158 | 68,506 | | Other loans (secured) | 153,151 | 172,958 | | **Total** | **220,784** | **261,208** | | Classified as current liabilities | (99,966) | (124,372) | | Non-current portion | 120,818 | 136,836 | - Secured bank loans bear annual interest rates ranging from **4.25% to 6.70%**[36](index=36&type=chunk) - Secured bank overdrafts and loans are guaranteed by subsidiaries and pledged against bank deposits and rights to project receivables[36](index=36&type=chunk)[38](index=38&type=chunk) [15. Share Capital](index=19&type=section&id=15.%20Share%20Capital) As of June 30, 2025, the Group's issued share capital increased due to a new share placement completed on April 2, 2025 Issued Share Capital (THB thousands) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | 680,000,000 ordinary shares | 28,712 | 28,712 | | 120,000,000 ordinary shares on April 2, 2025 | 5,203 | – | | **Total** | **33,915** | **28,712** | [16. Related Party Disclosures](index=19&type=section&id=16.%20Related%20Party%20Disclosures) The Group engaged in significant related party transactions during the period, including dividend payments and dividend expenses to IAH preference shareholders, and IT support service sales to an associate Related Party Transactions (THB thousands) | Transaction Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Dividends paid (IAH preference shareholders) | 12,278 | 10,391 | | Dividend expense (IAH preference shareholders) | 944 | 944 | | Sales of IT support services (associate) | – | 33,512 | Key Management Personnel Remuneration (THB thousands) | Remuneration Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Short-term employee benefits | 6,097 | 7,073 | | Post-employment benefits | 535 | 686 | | **Total** | **6,632** | **7,759** | [17. Contingent Liabilities](index=20&type=section&id=17.%20Contingent%20Liabilities) As of June 30, 2025, the Group's total outstanding bank guarantees amounted to THB 169.57 million, an increase from December 31, 2024 - Banks issued outstanding bank guarantees of **THB 169,568,000** on behalf of the Group for performance obligations in the ordinary course of business (December 31, 2024: **THB 145,446,000**)[42](index=42&type=chunk) [18. Approval of Condensed Consolidated Interim Financial Information](index=20&type=section&id=18.%20Approval%20of%20Condensed%20Consolidated%20Interim%20Financial%20Information) The condensed consolidated interim financial information for the six months ended June 30, 2025, was approved by the Board of Directors on August 28, 2025 - The condensed consolidated interim financial information was approved by the Board of Directors on August 28, 2025[43](index=43&type=chunk) [Management Discussion and Analysis](index=21&type=section&id=Management%20Discussion%20and%20Analysis) [Overview](index=21&type=section&id=Management%20Discussion%20and%20Analysis-Overview) The Group primarily provides IT solutions to financial institutions, government departments, and agencies in Thailand, having completed numerous large-scale projects and continuously expanding its customer base - The Group provides IT solutions to financial institutions, government departments, and agencies in Thailand[44](index=44&type=chunk) - The Company expanded its customer base to rural areas of Thailand by undertaking Customer F's ATM project and Passbook project[44](index=44&type=chunk) [Business Outlook](index=21&type=section&id=Business%20Outlook) Despite an uncertain macroeconomic environment and delays in some major projects, the Company remains cautiously optimistic about new project developments in the second half of 2025, expecting future revenue benefits - Thailand's economy is projected to grow by **2.3%** in 2025, but the second half may be affected by US tariffs and a slowdown in private consumption[45](index=45&type=chunk) - Some of the Company's major customers have delayed new projects from 2024 to the second half of 2025[45](index=45&type=chunk) - The Company is undertaking a new PEA project, expected to contribute approximately **THB 170 million** in revenue in the second half of 2025, and plans to bid for two major projects[46](index=46&type=chunk) [Financial Review](index=22&type=section&id=Financial%20Review) In the first half of 2025, the Group experienced significant declines in revenue, gross profit, and net other income, coupled with a substantial increase in administrative expenses, ultimately resulting in a net loss [Revenue](index=22&type=section&id=Revenue) - Total revenue decreased by approximately **54.3%** from approximately **THB 66.4 million** in the first half of 2024 to approximately **THB 30.4 million** in the first half of 2025[48](index=48&type=chunk) - The decrease in revenue was primarily due to a reduction of approximately **THB 33.5 million** in CDM project service contracts and approximately **THB 10.3 million** in ATM maintenance services[48](index=48&type=chunk) - Revenue from the new PEA project increased by approximately **THB 8.2 million** in the first half of 2025[48](index=48&type=chunk) [Gross Profit and Gross Margin](index=22&type=section&id=Gross%20Profit%20and%20Gross%20Margin) - Gross profit in the first half of 2025 was approximately **THB 4.8 million**, with a gross margin of **15.7%**, a significant decrease from **THB 16.5 million** and **24.9%** in the prior period[49](index=49&type=chunk) - The decline in gross profit was mainly due to customers delaying certain major projects to the second half of 2025[49](index=49&type=chunk) [Other Income and Net Gains](index=22&type=section&id=Other%20Income%20and%20Net%20Gains) - Other income in the first half of 2025 was approximately **THB 21.6 million**, a decrease of approximately **THB 14.3 million** from the prior period[50](index=50&type=chunk) - The decrease was primarily due to a reduction of approximately **THB 16.1 million** in unrealised gains on financial assets measured at fair value, approximately **THB 7.1 million** in interest income, and approximately **THB 6.2 million** in unrealised foreign exchange gains[50](index=50&type=chunk) - Gains on disposal of financial assets at fair value through profit or loss increased by approximately **THB 12.1 million**, and dividend income increased by approximately **THB 3.0 million**[50](index=50&type=chunk) [Selling and Distribution Expenses](index=22&type=section&id=Selling%20and%20Distribution%20Expenses) - Selling and distribution expenses in the first half of 2025 were approximately **THB 1.6 million**, a decrease of approximately **THB 1.2 million** from the prior period, mainly due to reduced sales staff salaries[51](index=51&type=chunk) [Administrative Expenses](index=23&type=section&id=Administrative%20Expenses) - Administrative expenses in the first half of 2025 were approximately **THB 50.4 million**, an increase of approximately **THB 26.4 million** from the prior period[52](index=52&type=chunk) - The increase was primarily due to an increase of approximately **THB 5.4 million** in depreciation expenses, approximately **THB 5.3 million** in office expenses, approximately **THB 0.4 million** in employee expenses, and approximately **THB 15.3 million** in foreign exchange losses[52](index=52&type=chunk) [Finance Costs](index=23&type=section&id=Finance%20Costs) - Finance costs in the first half of 2025 were approximately **THB 19.0 million**, a decrease of approximately **THB 4.0 million** from the prior period[53](index=53&type=chunk) - The decrease was mainly due to a reduction of approximately **THB 4.4 million** in bank loan interest expenses, partially offset by an increase of approximately **THB 0.4 million** in finance lease interest expenses[53](index=53&type=chunk) [Net Loss](index=23&type=section&id=Net%20Loss) - The Group recorded a net loss of approximately **THB 45.7 million** in the first half of 2025, compared to a profit of approximately **THB 1.2 million** in the prior period[54](index=54&type=chunk) [Financial Position](index=23&type=section&id=Financial%20Position) As of June 30, 2025, the Group's net current assets, current assets, current liabilities, non-current assets, and non-current liabilities all decreased, primarily influenced by the disposal of a subsidiary and project financing activities [Net Current Assets](index=23&type=section&id=Net%20Current%20Assets) - Net current assets decreased from approximately **THB 184.3 million** as of December 31, 2024, to approximately **THB 126.2 million** as of June 30, 2025[55](index=55&type=chunk) - The decrease was primarily due to a reduction of approximately **THB 101.5 million** in prepayments for equipment deposits resulting from the disposal of a subsidiary[55](index=55&type=chunk) - Financial assets at fair value through profit or loss increased by approximately **THB 20.9 million**, and contract costs for new projects increased by approximately **THB 18.0 million**[55](index=55&type=chunk) [Current Assets](index=23&type=section&id=Current%20Assets) - Current assets decreased by approximately **THB 175.8 million** from approximately **THB 844.6 million** as of December 31, 2024, to approximately **THB 668.8 million** as of June 30, 2025[56](index=56&type=chunk) - The decrease was primarily due to a reduction of approximately **THB 105.4 million** in trade receivables, approximately **THB 16.4 million** in finance lease receivables, and approximately **THB 101.5 million** in prepayments for equipment deposits[56](index=56&type=chunk) [Current Liabilities](index=24&type=section&id=Current%20Liabilities) - Current liabilities decreased from approximately **THB 660.4 million** as of December 31, 2024, to approximately **THB 542.6 million** as of June 30, 2025[57](index=57&type=chunk) - The decrease was primarily due to a reduction of approximately **THB 94.3 million** in trade payables and approximately **THB 24.4 million** in bank and other borrowings[57](index=57&type=chunk) [Non-Current Assets](index=24&type=section&id=Non-Current%20Assets) - Non-current assets decreased from approximately **THB 392.3 million** as of December 31, 2024, to approximately **THB 362.1 million** as of June 30, 2025[58](index=58&type=chunk) - The decrease was primarily due to a reduction of approximately **THB 41.2 million** in right-of-use assets resulting from the disposal of a subsidiary[58](index=58&type=chunk) - Pledged bank deposits increased by approximately **THB 10.8 million** for project financing of new projects[58](index=58&type=chunk) [Non-Current Liabilities](index=24&type=section&id=Non-Current%20Liabilities) - Non-current liabilities decreased from approximately **THB 212.2 million** as of December 31, 2024, to approximately **THB 164.1 million** as of June 30, 2025[59](index=59&type=chunk) - The decrease was primarily due to a reduction of approximately **THB 27.4 million** in non-current lease liabilities from the disposal of a subsidiary, approximately **THB 5.1 million** in non-current trade payables from Customer F's ATM project, and approximately **THB 16.0 million** in bank and other borrowings[59](index=59&type=chunk) [Liquidity and Financial Resources](index=24&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, the Group's net bank and other borrowings decreased, and its gearing ratio improved, with business primarily financed by project loans from financial institutions - The net balance of bank and other borrowings decreased by approximately **THB 40.4 million** to approximately **THB 220.8 million**, mainly due to repayment of maturing payments[60](index=60&type=chunk) - All of the Group's bank loans are denominated in Thai Baht, with effective annual interest rates ranging from **4.25% to 6.70%**[60](index=60&type=chunk) - The gearing ratio was approximately **68.1%** (December 31, 2024: **71.7%**), calculated as interest-bearing debt divided by total equity[61](index=61&type=chunk) [Capital Structure](index=25&type=section&id=Capital%20Structure) The Group's shareholders' equity decreased due to the total comprehensive expense in the first half of 2025 but was supplemented by funds raised through a new share placement - The Group's shareholders' equity comprises issued share capital, share premium, accumulated losses, and other reserves[62](index=62&type=chunk) - Equity attributable to shareholders decreased from approximately **THB 364.4 million** as of December 31, 2024, to approximately **THB 324.2 million** as of June 30, 2025, primarily due to total comprehensive expense of approximately **THB 43.7 million**[62](index=62&type=chunk) [Completion of Placing of New Shares Under General Mandate on 2 April 2025](index=25&type=section&id=Completion%20of%20Placing%20of%20New%20Shares%20Under%20General%20Mandate%20on%202%20April%202025) The Company completed a new share placement on April 2, 2025, placing **120 million** ordinary shares for total gross proceeds of approximately **HKD 9.6 million**, with net proceeds used for general working capital and bank loan repayment - The Company placed **120,000,000** ordinary shares at **HKD 0.08** per share under a general mandate, with the placing completed on April 2, 2025[63](index=63&type=chunk)[64](index=64&type=chunk) - The gross proceeds from the placing were approximately **HKD 9.6 million**, with net proceeds of approximately **HKD 9.251 million**[64](index=64&type=chunk) - Approximately **85%** of the net proceeds were used for administrative and operating expenses, and approximately **6.6%** was used for repayment of bank loans[65](index=65&type=chunk) [Capital Commitments](index=25&type=section&id=Capital%20Commitments) As of June 30, 2025, the Group had no other significant capital commitments - As of June 30, 2025, the Group had no other significant capital commitments[66](index=66&type=chunk) [Significant Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=26&type=section&id=Significant%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%20and%20Joint%20Ventures) On June 10, 2025, the Group disposed of **100%** of the issued shares of its indirect wholly-owned subsidiary, Global Wealth (Hong Kong) Limited, for **HKD 12.8 million** - On June 10, 2025, the Group disposed of **100%** of the issued shares of its indirect wholly-owned subsidiary, Global Wealth (Hong Kong) Limited, to an independent third party for **HKD 12,800,000**[67](index=67&type=chunk) [Contingent Liabilities](index=26&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group's total outstanding bank guarantees amounted to THB 169.57 million, an increase from December 31, 2024 - Banks issued outstanding bank guarantees of **THB 169,568,000** on behalf of the Group for certain performance obligations in the ordinary course of business (December 31, 2024: **THB 145,446,000**)[68](index=68&type=chunk) [Pledge of Assets](index=26&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, approximately **THB 83.62 million** of the Group's bank deposits were pledged to banks to secure letters of guarantee, bank loans, and bank overdrafts - Approximately **THB 83,618,000** of the Group's bank deposits were pledged to banks to secure letters of guarantee, bank loans, and bank overdrafts[69](index=69&type=chunk) [Employees and Remuneration Policy](index=26&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had **50** employees, with labor costs of approximately **THB 16.3 million**, representing **53.5%** of revenue, and provides competitive remuneration and training to enhance employee loyalty and performance - As of June 30, 2025, the Group had **50** employees (December 31, 2024: **56** employees)[70](index=70&type=chunk) - Labor costs were approximately **THB 16.3 million**, equivalent to **53.5%** of the Group's revenue for the first half of 2025[70](index=70&type=chunk) - The Group offers competitive basic salaries plus annual performance bonuses and continuously provides training[70](index=70&type=chunk) [Material Investments Held](index=27&type=section&id=Material%20Investments%20Held) As of June 30, 2025, the Group did not hold any material investments - As of June 30, 2025, the Group did not hold any material investments[71](index=71&type=chunk) [Future Plans for Material Investments or Capital Assets](index=27&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of June 30, 2025, the Group had no other significant plans for material investments or capital assets - As of June 30, 2025, the Group had no other significant plans for material investments or capital assets[72](index=72&type=chunk) [Events After the Reporting Period](index=27&type=section&id=Events%20After%20the%20Reporting%20Period) Subsequent to the reporting period, on August 8, 2025, the Company entered into a subscription agreement to allot and issue **160 million** new shares at **HKD 0.107** per share, for total gross proceeds of approximately **HKD 17.12 million**, pending Stock Exchange approval - On August 8, 2025, the Company entered into a subscription agreement with subscribers to subscribe for a total of **160,000,000** new shares at **HKD 0.107** per share[73](index=73&type=chunk) - The gross proceeds from the subscription will be approximately **HKD 17.12 million**, subject to approval by the Listing Committee of the Stock Exchange[73](index=73&type=chunk) [Foreign Exchange Risk](index=27&type=section&id=Foreign%20Exchange%20Risk) The Group primarily operates in Thailand, with revenue and payments mainly in Thai Baht, thus facing limited foreign exchange risk, but it closely monitors exchange rate fluctuations to manage currency risk - The Group primarily operates in Thailand, with revenue mainly in Thai Baht and payments to suppliers also predominantly in Thai Baht, hence foreign exchange risk is limited[75](index=75&type=chunk) - The Group will closely monitor exchange rate fluctuations to manage currency risk and assess necessary measures as needed[75](index=75&type=chunk) [Other Information](index=28&type=section&id=Other%20Information) [Interim Dividend](index=28&type=section&id=Interim%20Dividend) The Board of Directors does not recommend the declaration of an interim dividend for the six months ended June 30, 2025 - The Board of Directors does not recommend the declaration of an interim dividend for the six months ended June 30, 2025[76](index=76&type=chunk) [Purchase, Sale or Redemption of the Company’s Listed Securities](index=28&type=section&id=Purchase%20Sale%20or%20Redemption%20of%20the%20Company%E2%80%99s%20Listed%20Securities) 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[77](index=77&type=chunk) [Corporate Governance](index=28&type=section&id=Corporate%20Governance) The Company is committed to maintaining high standards of corporate governance and complies with the Corporate Governance Code in Appendix C1 of the Listing Rules, though the roles of Chairman and Chief Executive Officer are not separated, which the Board believes is in the best interest of the Company and its shareholders - The Company has consistently complied with the Corporate Governance Code in Appendix C1 of the Listing Rules, except for a deviation from Code Provision C.2.1 regarding the separation of the roles of Chairman and Chief Executive Officer[78](index=78&type=chunk) - Mr. Asvaplungprohm serves as both the Chairman and Chief Executive Officer of the Company, and the Board believes the current arrangement is in the best interest of the Company and its shareholders as a whole[78](index=78&type=chunk) [Compliance with the Model Code for Securities Transactions](index=29&type=section&id=Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions) The Company has adopted a code for securities transactions no less exacting than the Model Code set out in Appendix C3 of the Listing Rules, and all directors and employees have confirmed compliance with the relevant provisions - The Company has adopted a code for securities transactions with terms no less exacting than the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix C3 of the Listing Rules[80](index=80&type=chunk) - All Directors confirmed that they have complied with the required standards set out in the Model Code and the Securities Transaction Code during the six months ended June 30, 2025[80](index=80&type=chunk) [Competing Interests](index=29&type=section&id=Competing%20Interests) As of June 30, 2025, no Director or their respective associates were involved in or had any interest in any business that competes or may compete with the Group's business - As of June 30, 2025, no Director or their respective associates were involved in or had any interest in any business that competes or may compete with the Group's business[81](index=81&type=chunk) [Review by Audit Committee](index=29&type=section&id=Review%20by%20Audit%20Committee) The Audit Committee has reviewed the Group's accounting principles, internal controls, and financial reporting matters, concluding that the unaudited condensed consolidated interim financial information for the six months ended June 30, 2025, complies with relevant accounting standards, rules, and regulations - The Audit Committee comprises three independent non-executive Directors, with Mr. Ruan Guoquan serving as Chairman, possessing professional qualifications and financial experience[82](index=82&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and discussed internal controls and financial reporting matters[83](index=83&type=chunk) - The Audit Committee believes that the interim financial information complies with relevant accounting standards, rules, and regulations and has made appropriate disclosures[83](index=83&type=chunk) [Publication of Interim Results and Interim Report](index=30&type=section&id=Publication%20of%20Interim%20Results%20and%20Interim%20Report) This interim results announcement has been published on the Stock Exchange website and the Company's website, and the interim report will be dispatched to shareholders and published on the aforementioned websites in due course - This interim results announcement has been published on the Stock Exchange website (www.hkexnews.hk) and the Company's website (http://www.plattnera.com)[84](index=84&type=chunk) [Definitions](index=30&type=section&id=Definitions) This section provides definitions for key terms used in the report, including company entities, project names, regulatory bodies, and currency units - This section defines key terms used throughout the report, ensuring clarity and consistency in understanding the financial and operational context[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk)[89](index=89&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。 Dongguan Rural Commercial Bank Co., Ltd.* 東莞農村商業銀行股份有限公司 * （ 於 中 華 人 民 共 和 國 註 冊 成 立 的 股 份 有 限 公 司 ） （股份代號：9889） 截至2025年6月30日止六個月之 中期業績公告 東莞農村商業銀行股份有限公司（「本行」）董事會（「董事會」）欣然宣佈本行及其附屬公司 截至2025年6月30日止六個月之未經審計綜合中期業績（「中期業績」）。董事會審計委員會 已審閱並確認中期業績。 本業績公告刊載於香港聯合交易所有限公司網站(www.hkexnews.hk)及本行網站 (www.drcbank.com)。本行2025年中期報告將於2025年9月於上述網站上公佈。 東莞農村商業銀行股份有限公司 董事會 中國廣東省東莞市 2025年8月28日 於本公告日期，本行董事會包括執行董事盧國鋒先生、傅強先生、錢華先生及葉建光先 ...

中期報 告 2025 INTERIM REPORT 2025 TIA N N E N G P O W E R IN T E R N ATIO N AL LIMIT E D 天 能 動 力 國 際 有 限 公 司 INTERIM REPORT 2025 二零二五年中期報告 目錄 | 公司資料 | 2 | | --- | --- | | 管理層討論及分析 | 4 | | 企業管治 | 40 | | 簡明綜合財務報表審閱報告 | 41 | | 簡明綜合損益及其他全面收益表 | 43 | | 簡明綜合財務狀況表 | 46 | | 簡明綜合權益變動表 | 49 | | 簡明綜合現金流量表 | 50 | | 簡明綜合財務報表附註 | 52 | 其他資料 82 天能動力國際有限公司 01 頁次 二零二五年中期報告 公司資料 執行董事 張天任博士 （主席） 張敖根先生 史伯榮先生 張開紅先生 周建中先生 中期報告 獨立非執行董事 黃董良先生 張湧先生 肖鋼先生 郭圓濤博士 審核委員會成員 黃董良先生 （主席） 張湧先生 肖鋼先生 薪酬委員會成員 肖鋼先生 （主席） 黃董良先生 張敖根先生 提名委員會成員 張天任博士 （主席） ...

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。 CHINA ISOTOPE & RADIATION CORPORATION 中國同輻股份有限公司 （於中華人民共和國註冊成立的股份有限公司） （股份代號：1763) 截至2025年6月30日止六個月之中期業績公告 中國同輻股份有限公司（「本公司」或「中國同輻」，連同附屬公司統稱「本集團」或 「我們」）董事（「董事」）會（「董事會」）謹此提呈本集團截至2025年6月30日止六個 月（「2025年上半年」或「報告期」）之未經審核簡明合併財務報表，連同2024年同 期未經審核之比較數字載列如下。 刊登業績公告及中期報告 本公告已於聯交所網站 www.hkexnews.hk 及本公司網站 www.circ.com.cn 發佈。本 公司將於同日在上述網站發佈截至2025年6月30日止六個月的中期報告。 承董事會命 中國同輻股份有限公司 董事長 肖亞飛 中國北京，2025年8月28日 於本公告日期，董事會成員包括執 ...

[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) [Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) The company reported a 13.1% decrease in revenue and a 22.9% decrease in gross profit, but a significant 58.8% increase in profit for the period and a 78.3% increase in non-IFRS adjusted net profit for the six months ended June 30, 2025 Financial Highlights for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 726,044 | 835,659 | (13.1) | | Gross Profit | 318,352 | 412,968 | (22.9) | | Profit for the Period | 53,469 | 33,670 | 58.8 | | Non-IFRS Adjusted Net Profit Attributable to Owners of the Company | 74,902 | 42,002 | Not Applicable | - Non-IFRS adjusted net profit is primarily adjusted for share-based payment expenses, share of losses (profits) of associates and joint ventures, and impairment losses recognized on loan receivables under the expected credit loss model[3](index=3&type=chunk) [Revenue by Virtual Product Type](index=2&type=section&id=%E6%8C%89%E8%99%9B%E6%93%AC%E7%94%A2%E5%93%81%E9%A1%9E%E5%9E%8B%E5%8A%83%E5%88%86%E7%9A%84%E6%94%B6%E7%9B%8A) For the six months ended June 30, 2025, revenue from self-developed mobile games decreased by 30.6%, while third-party mobile game revenue surged by 123.4% and advertising revenue grew by 21.6%, resulting in an overall revenue decline of 13.1% Revenue by Virtual Product Type (For the Six Months Ended June 30) | Revenue Source | 2025 (RMB thousand) | % of Total Revenue | 2024 (RMB thousand) | % of Total Revenue | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Self-developed Mobile Games | 505,256 | 69.6 | 727,599 | 87.1 | (30.6) | | Third-party Mobile Games | 196,141 | 27.0 | 87,799 | 10.5 | 123.4 | | **Total Mobile Game Revenue** | **701,397** | **96.6** | **815,398** | **97.6** | **(14.0)** | | Advertising Revenue | 24,647 | 3.4 | 20,261 | 2.4 | 21.6 | | **Total** | **726,044** | **100.0** | **835,659** | **100.0** | **(13.1)** | - For the six months ended June 30, 2024, RMB34.2 million of revenue from self-developed mobile games was reclassified to third-party mobile game revenue to better reflect the Group's current situation[5](index=5&type=chunk) [Operating Highlights](index=3&type=section&id=%E7%B6%93%E7%87%9F%E6%91%98%E8%A6%81) As of June 30, 2025, Daily Active Users (DAUs) and average Monthly Active Users (MAUs) remained stable year-on-year, but the number of paying users significantly decreased, reflecting the short-term impact of commercialization strategy adjustments on light users' willingness to pay Key Operating Data (As of June 30) | Indicator | As of or For the Six Months Ended June 30, 2025 | As of or For the Six Months Ended June 30, 2024 | As of or For the Year Ended December 31, 2024 | | :--- | :--- | :--- | :--- | | Daily Active Users (DAUs) | 12,306,675 | 13,360,659 | 13,377,495 | | Paying Users | 9,089,428 | 15,691,516 | 17,756,141 | | Average Monthly Active Users (MAUs) | 59,781,933 | 65,697,381 | 64,342,667 | - DAUs refer to the number of daily active users on the last calendar day of any given period[8](index=8&type=chunk) - Paying users refer to players who have paid at least once to play the Company's mobile game products or purchased virtual tokens offered by the Company in its mobile game products during any given period[8](index=8&type=chunk) [Business Overview and Outlook](index=4&type=section&id=%E6%A5%AD%E5%8B%99%E6%A6%82%E8%A7%88%E5%8F%8A%E5%B1%95%E6%9C%9B) During the reporting period, the Group continued to focus on advantageous segments, achieving significant growth in third-party co-operated game revenue and effective marketing cost control through product content iteration, commercialization model optimization, and refined operations, with future plans to deepen AI technology application, expand user base, strengthen product reserves, and broaden strategic alliances [Business Review](index=4&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) - Launched new seasonal mechanisms and themed visual versions, such as "Weile Fishing Thousand Cannons Edition" deeply integrating the Eastern fantasy theme of Shan Hai Jing[9](index=9&type=chunk) - "Weile Dou Dizhu" and "Weile Sichuan Mahjong" successfully launched on Douyin channel, consistently ranking among the top of Douyin's chess and card popularity list, achieving cross-platform user and brand growth[9](index=9&type=chunk) - Revenue from self-developed mobile games decreased year-on-year, primarily due to commercialization adjustments affecting the payment willingness of some light users[10](index=10&type=chunk) - Third-party mobile game revenue significantly increased by **123.4% to RMB196 million**[10](index=10&type=chunk) - Selling and marketing expenses decreased by **50.8% year-on-year to RMB128.6 million**[12](index=12&type=chunk) - Profit for the period increased by **58.8% year-on-year to RMB53.47 million**; adjusted net profit was **RMB74.9 million**, indicating an overall improvement in profitability[12](index=12&type=chunk) - Accelerated overseas expansion, with overseas fishing products receiving enthusiastic user response in markets such as Vietnam, Hong Kong, Macau, Taiwan, and Indonesia, and multiple products expected to be launched globally within 2025[13](index=13&type=chunk) - Multi-modal AI intelligent agent has entered comprehensive internal testing and multi-business adaptation stages, initially achieving automated empowerment in key aspects such as user portrait analysis, intelligent customer service, and video content distribution[14](index=14&type=chunk) [Strategies for H2 2025](index=6&type=section&id=%E4%BA%8C%E9%9B%B6%E4%BA%94%E4%BA%94%E5%B9%B4%E4%B8%8B%E5%8D%8A%E5%B9%B4%E7%AD%96%E7%95%A5) - Deepen cutting-edge technology, self-develop multi-modal AI intelligent agents, and promote their integration into various business segments, accelerating the AI transformation of the entire R&D and operation process[15](index=15&type=chunk) - Penetrate regional markets, precisely meet localized entertainment demands in domestic second and third-tier markets and regions with lower user penetration rates, and formulate differentiated marketing strategies to expand the user base[16](index=16&type=chunk) - Strengthen product reserves, advance testing and launch of multiple reserve projects, accelerate the launch of overseas products, and build diversified revenue growth engines[17](index=17&type=chunk) - Expand strategic alliances, actively explore new business opportunities through incubation, investment, and acquisition[18](index=18&type=chunk) [Management Discussion and Analysis](index=7&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) Management discussed the financial performance and operating strategies for the reporting period, noting that revenue decline was mainly due to reduced self-developed game income, offset by significant growth in third-party games and advertising revenue, while effective cost control, particularly in selling and marketing and R&D expenses, drove substantial increases in profit for the period and adjusted net profit, with the company maintaining ample liquidity, no significant debt, and continued investment in AI technology and overseas market expansion [Financial Review](index=7&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) [Revenue](index=7&type=section&id=%E6%94%B6%E7%9B%8A) - Revenue primarily comprises income from virtual token sales for self-developed mobile games, third-party mobile games, and advertising[19](index=19&type=chunk) - For the six months ended June 30, 2025, total revenue was approximately **RMB726.0 million**, a **13.1% decrease** from approximately RMB835.7 million in the same period of 2024[20](index=20&type=chunk) - The decrease in revenue was mainly due to a **30.6% year-on-year decline** in self-developed mobile game revenue, affected by commercialization strategy adjustments impacting player payment willingness[20](index=20&type=chunk) Revenue Composition (For the Six Months Ended June 30) | Revenue Source | 2025 % Share | 2024 % Share | | :--- | :--- | :--- | | Sale of Virtual Tokens (Self-developed) | 69.6 | 87.1 | | Distribution of Third-party Mobile Games | 27.0 | 10.5 | | Advertising | 3.4 | 2.4 | [Cost of Sales and Gross Profit](index=7&type=section&id=%E9%8A%B7%E5%94%AE%E6%88%90%E6%9C%AC%E5%8F%8A%E6%AF%9B%E5%88%A9) - Cost of sales decreased by **3.5%** from approximately RMB422.7 million in the same period of 2024 to approximately **RMB407.7 million** in the same period of 2025, primarily due to reduced revenue from self-developed mobile games[21](index=21&type=chunk) - Gross profit decreased by **22.9%** from approximately RMB413.0 million in the same period of 2024 to approximately **RMB318.4 million** in the same period of 2025[22](index=22&type=chunk) - Gross profit margin decreased from **49.4%** in the same period of 2024 to **43.8%** in the same period of 2025, mainly due to increased new media costs and amortization of intangible assets[22](index=22&type=chunk) [Other Income, Gains and Losses](index=8&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E3%80%81%E6%94%B6%E7%9B%8A%E5%8F%8A%E虧%E6%90%8D) - Other income decreased by **46.0%** from approximately RMB20.2 million in the same period of 2024 to approximately **RMB13.8 million** in the same period of 2025, primarily due to a decrease in interest income[23](index=23&type=chunk) - Other gains and losses changed from a gain of approximately RMB15.7 million in the same period of 2024 to a loss of approximately **RMB3.3 million** in the same period of 2025, a decrease of RMB18.9 million, mainly due to a loss of RMB10.4 million from derecognition of receivables upon disposal of an associate[24](index=24&type=chunk) [Net Exchange Loss](index=8&type=section&id=%E5%BD%99%E5%85%8C%E虧%E6%90%8D%E6%B7%A8%E9%A1%8D) - A net exchange loss of approximately **RMB2.2 million** was recorded for the six months ended June 30, 2025, compared to a net exchange loss of approximately RMB0.7 million in the same period of 2024, primarily due to fluctuations in the USD exchange rate[25](index=25&type=chunk) [Selling and Marketing Expenses](index=8&type=section&id=%E9%8A%B7%E5%94%AE%E5%8F%8A%E7%87%9F%E9%8A%B7%E9%96%8B%E6%94%AF) - Selling and marketing expenses decreased by **50.8%** from approximately RMB261.1 million in the same period of 2024 to approximately **RMB128.6 million** in the same period of 2025, primarily due to a sharp reduction in promotion and advertising expenses[26](index=26&type=chunk) [Administrative and Other Expenses](index=8&type=section&id=%E8%A1%8C%E6%94%BF%E5%8F%8A%E5%85%B6%E4%BB%96%E9%96%8B%E6%94%AF) - Administrative and other expenses decreased by **17.6%** from approximately RMB66.6 million in the same period of 2024 to approximately **RMB60.4 million** in the same period of 2025, primarily due to a decrease in professional service fees[27](index=27&type=chunk) [Research and Development Expenses](index=9&type=section&id=%E7%A0%94%E7%99%BC%E6%94%AF%E5%87%BA) - Research and development expenses decreased by **38.5%** from approximately RMB57.3 million in the same period of 2024 to approximately **RMB35.2 million** in the same period of 2025, primarily due to a decrease in R&D staff remuneration expenses[28](index=28&type=chunk) [Profit Before Income Tax](index=9&type=section&id=%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%85%E5%89%8D%E6%BA%A2%E5%88%A9) - Profit before income tax increased by **55.6%** from approximately RMB40.3 million in the same period of 2024 to approximately **RMB62.8 million** in the same period of 2025[29](index=29&type=chunk) - The percentage of profit before income tax to total revenue increased from **4.8%** in the same period of 2024 to **8.6%** in the same period of 2025, primarily due to reduced selling and marketing expenses and R&D expenses[29](index=29&type=chunk) [Income Tax Expense](index=9&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) - Income tax expense increased by **39.7%** from RMB6.7 million in the same period of 2024 to **RMB9.3 million** in the same period of 2025[30](index=30&type=chunk) - The effective tax rate decreased from **16.5%** in the same period of 2024 to **14.8%** in the same period of 2025, with the increase in income tax expense attributed to higher profit before tax[30](index=30&type=chunk) [Profit Attributable to Owners of the Company](index=9&type=section&id=%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%93%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%B5%E6%BA%A2%E5%88%A9) - Profit attributable to owners of the Company increased by **33.5%** from approximately RMB28.0 million in the same period of 2024 to approximately **RMB37.4 million** in the same period of 2025[31](index=31&type=chunk) [Non-IFRS Measures – Adjusted Net Profit](index=9&type=section&id=%E9%9D%9E%E5%9C%8B%E9%9A%9B%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%E8%A8%88%E9%87%8F%E2%80%94%E7%B6%93%E8%AA%BF%E6%95%B4%E7%B4%94%E5%88%A9) - Adjusted net profit aims to assess financial performance by excluding the impact of non-recurring and non-cash items such as share-based payment expenses, share of losses of associates and joint ventures, and impairment losses on loan receivables[32](index=32&type=chunk)[33](index=33&type=chunk) Calculation of Adjusted Net Profit Attributable to Owners of the Company (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company | 37,395 | 28,009 | | Add: Share-based payment expenses | 3,646 | 13,993 | | Add: Share of losses of associates and joint ventures | 5,027 | — | | Add: Impairment losses recognized on loan receivables under expected credit loss model (net of income tax) | 28,834 | — | | **Adjusted Net Profit Attributable to Owners of the Company** | **74,902** | **42,002** | [Liquidity and Capital Resources](index=10&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B3%87%E6%9C%AC%E4%BE%86%E6%BA%90) [Cash and Cash Equivalents](index=10&type=section&id=%E7%8F%BE%E9%87%91%E5%8F%8A%E7%8F%BE%E9%87%91%E7%AD%89%E5%83%B9%E7%89%A9) - The Group primarily funds its operations with cash generated from operating activities[35](index=35&type=chunk) - As of June 30, 2025, cash and cash equivalents were approximately **RMB827.7 million**, an increase from approximately RMB755.0 million as of December 31, 2024[36](index=36&type=chunk) - The Company currently has no foreign currency hedging policy, but the Board will monitor risks and consider hedging[36](index=36&type=chunk) [Indebtedness and Gearing Ratio](index=11&type=section&id=%E5%82%B5%E5%8B%99%E5%8F%8A%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E6%AF%94%E7%8E%87) - As of the six months ended June 30, 2025, the Group had no short-term or long-term bank borrowings, except for lease liabilities of RMB15.8 million[37](index=37&type=chunk) - The gearing ratio was zero as of June 30, 2025, due to the absence of debt[38](index=38&type=chunk) [Pledge of Assets](index=11&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) - As of June 30, 2025, the Group had not pledged any assets[39](index=39&type=chunk) [Capital Expenditure](index=11&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF) - Capital expenditure for the six months ended June 30, 2025, was approximately **RMB58.3 million**, a significant decrease from approximately RMB216 million in the same period of 2024[40](index=40&type=chunk) - The decrease in capital expenditure was mainly due to the Group's reduced expenditure on acquiring investments in associates[40](index=40&type=chunk) [Contingent Liabilities and Guarantees](index=12&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5%E5%8F%8A%E6%93%94%E4%BF%9D) - As of June 30, 2025, the Group had no unrecorded material contingent liabilities, guarantees, or any litigation against the Group[41](index=41&type=chunk) [Material Acquisitions, Disposals and Future Plans for Major Investments](index=12&type=section&id=%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E3%80%81%E5%87%BA%E5%94%AE%E5%8F%8A%E4%B8%BB%E8%A6%81%E6%8A%95%E8%B3%87%E7%9A%84%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) - During the reporting period, the Group had no material acquisitions or disposals of subsidiaries, joint ventures, associates, or financial assets, nor any future plans for major investments or capital assets[42](index=42&type=chunk) [Employees and Staff Costs](index=12&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E5%93%A1%E5%B7%A5%E6%88%90%E6%9C%AC) - As of June 30, 2025, the Group had a total of **612 full-time employees**, primarily located in mainland China[43](index=43&type=chunk) - Total staff costs for the six months ended June 30, 2025, were approximately **RMB67.3 million**, a decrease from approximately RMB99.8 million in the same period of 2024, mainly due to year-on-year reductions in salaries, other in-kind benefits, and share-based payment expenses[43](index=43&type=chunk) - The Board resolved to terminate the share option scheme on April 2, 2025, and adopted the 2025 share scheme on June 17, 2025[44](index=44&type=chunk) [Condensed Consolidated Financial Statements](index=13&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) This section presents the company's unaudited condensed consolidated statement of profit or loss and other comprehensive income, statement of financial position, statement of changes in equity, and statement of cash flows for the six months ended June 30, 2025, providing financial data reflecting operating results, financial position, and cash flow changes during the reporting period [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=13&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) Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 726,044 | 835,659 | | Cost of sales | (407,692) | (422,691) | | Gross profit | 318,352 | 412,968 | | Other income | 13,837 | 20,203 | | Other gains and losses | (3,263) | 15,667 | | Net exchange loss | (2,198) | (683) | | Selling and marketing expenses | (128,556) | (261,129) | | Administrative and other expenses | (60,424) | (66,637) | | Research and development expenses | (35,224) | (57,253) | | Impairment losses under expected credit loss model | (34,275) | (6,285) | | Share of results of associates | (310) | (14,928) | | Share of results of joint ventures | (4,717) | (960) | | Interest on lease liabilities | (444) | (629) | | Profit before income tax | 62,778 | 40,334 | | Income tax expense | (9,309) | (6,664) | | Profit and total comprehensive income for the period | 53,469 | 33,670 | | Profit for the period attributable to owners of the Company | 37,395 | 28,009 | | Profit for the period attributable to non-controlling interests | 16,074 | 5,661 | | Basic earnings per share (RMB cents) | 3.05 | 2.23 | | Diluted earnings per share (RMB cents) | 3.05 | 2.23 | [Condensed Consolidated Statement of Financial Position](index=14&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) Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, plant and equipment | 54,979 | 64,813 | | Right-of-use assets | 14,771 | 20,512 | | Intangible assets | 18,265 | 33,807 | | Investments in associates | 52,015 | 54,920 | | Investments in joint ventures | 39,858 | 39,575 | | Financial assets at fair value through profit or loss | 26,766 | 31,243 | | Equity instruments at fair value through other comprehensive income | 33,439 | 33,439 | | Non-current other receivables and deposits | 8,086 | 9,573 | | Deferred tax assets | 75,675 | 65,933 | | Receivables from disposal of subsidiaries | 5,500 | 5,500 | | Receivables from disposal of associates | 51,426 | — | | Loan receivables | 70,102 | 44,000 | | **Total Non-current Assets** | **450,882** | **403,315** | | **Current Assets** | | | | Trade receivables | 88,353 | 94,413 | | Financial assets at fair value through profit or loss | 446,057 | 393,726 | | Prepayments, other receivables and deposits | 86,790 | 182,882 | | Receivables from disposal of subsidiaries | 1,700 | 11,350 | | Receivables from disposal of associates | 54,709 | 106,989 | | Loan receivables | 107,532 | 104,403 | | Restricted bank deposits | — | 50,000 | | Short-term bank deposits | 162,000 | 65,000 | | Cash and cash equivalents | 827,676 | 755,032 | | **Total Current Assets** | **1,774,817** | **1,763,795** | | **Current Liabilities** | | | | Trade and other payables | 89,344 | 55,114 | | Deferred revenue | 111,809 | 147,105 | | Tax payable | 31,028 | 18,900 | | Lease liabilities | 6,255 | 8,365 | | Dividends payable | — | 4,800 | | **Total Current Liabilities** | **238,436** | **234,284** | | **Net Current Assets** | **1,536,381** | **1,529,511** | | **Total Assets Less Current Liabilities** | **1,987,263** | **1,932,826** | | **Non-current Liabilities** | | | | Lease liabilities | 9,519 | 12,888 | | Deferred tax liabilities | 1,721 | 3,786 | | **Total Non-current Liabilities** | **11,240** | **16,674** | | **Net Assets** | **1,976,023** | **1,916,152** | | **Capital and Reserves** | | | | Share capital | 42 | 42 | | Reserves | 1,921,015 | 1,882,018 | | Equity attributable to owners of the Company | 1,921,057 | 1,882,060 | | Non-controlling interests | 54,966 | 34,092 | | **Total Equity** | **1,976,023** | **1,916,152** | [Condensed Consolidated Statement of Changes in Equity](index=16&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) Condensed Consolidated Statement of Changes in Equity (For the Six Months Ended June 30) | Indicator (RMB thousand) | Share Capital | Shares Held for Share Award Scheme | Share Premium | Statutory Reserve | Other Reserves | Share-based Payment Reserve | Fair Value Through Other Comprehensive Income Reserve | Retained Earnings | Subtotal Attributable to Owners of the Company | Non-controlling Interests | Total Equity | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | As at January 1, 2024 (Audited) | 42 | (9,551) | 40,163 | 15,027 | 19,199 | 13,878 | (13,593) | 2,018,138 | 2,083,303 | 847 | 2,084,150 | | Profit and total comprehensive income for the period | — | — | — | — | — | — | — | 28,009 | 28,009 | 5,661 | 33,670 | | Share-based payment expenses recognized under share option scheme and increase in fair value under compensation grants (as defined in Note 19) | — | — | — | — | — | 142 | — | — | 142 | — | 142 | | Share-based payment expenses recognized under 2021 Share Award Scheme | — | — | — | — | — | 43 | — | — | 43 | — | 43 | | Share-based payment expenses recognized under 2024 Share Award Scheme | — | — | — | — | — | 13,808 | — | — | 13,808 | — | 13,808 | | Awarded shares vested under compensation grants, 2021 Share Award Scheme and 2024 Share Award Scheme | — | 14,382 | 12,162 | — | — | (26,544) | — | — | — | — | — | | Share-based payment expenses related to forfeited share awards after vesting date | — | — | — | — | — | (1,327) | — | 1,327 | — | — | — | | Shareholder contribution | — | (64,790) | — | — | 64,790 | — | — | — | — | — | — | | Repurchase of shares | — | (10,894) | — | — | — | — | — | — | (10,894) | — | (10,894) | | Dividends recognized as distribution | — | — | — | — | — | — | — | (117,226) | (117,226) | — | (117,226) | | **As at June 30, 2024 (Unaudited)** | **42** | **(70,853)** | **52,325** | **15,027** | **83,989** | **—** | **(13,593)** | **1,930,248** | **1,997,185** | **6,508** | **2,003,693** | | As at January 1, 2025 (Audited) | 42 | (94,323) | 46,305 | 15,027 | 99,636 | — | (11,845) | 1,827,218 | 1,882,060 | 34,092 | 1,916,152 | | Profit and total comprehensive income for the period | — | — | — | — | — | — | — | 37,395 | 37,395 | 16,074 | 53,469 | | Share-based payment expenses recognized under 2025 Share Award Scheme | — | — | — | — | — | 3,646 | — | — | 3,646 | — | 3,646 | | Awarded shares vested under 2025 Share Award Scheme | — | 6,386 | (2,740) | — | — | (3,646) | — | — | — | — | — | | Repurchase of shares | — | (2,044) | — | — | — | — | — | — | (2,044) | — | (2,044) | | Cancellation of dividends paid to non-controlling interests | — | — | — | — | — | — | — | — | — | 4,800 | 4,800 | | **As at June 30, 2025 (Unaudited)** | **42** | **(89,981)** | **43,565** | **15,027** | **99,636** | **—** | **(11,845)** | **1,864,613** | **1,921,057** | **54,966** | **1,976,023** | Share Repurchase Details (For the Six Months Ended June 30) | Repurchase Month | Number of Ordinary Shares | Price Per Share (HKD) (Highest/Lowest) | Total Consideration Paid (HKD thousand) | | :--- | :--- | :--- | :--- | | **2025** | | | | | January | 580,000 | 1.494 / 1.363 | 836 | | May | 680,000 | 1.176 / 1.103 | 769 | | June | 526,000 | 1.288 / 1.122 | 624 | | **Total** | **1,786,000** | | **2,229** | | **2024** | | | | | January | 2,974,000 | 2.684 / 2.197 | 7,439 | | April | 1,352,000 | 2.248 / 1.966 | 2,962 | | June | 838,000 | 1.915 / 1.877 | 1,581 | | **Total** | **5,164,000** | | **11,982** | - For the six months ended June 30, 2025, the Company repurchased **1,786,000 shares** in the open market through Futu Securities International (Hong Kong) Limited, with a total consideration of approximately **RMB2,044,000**[51](index=51&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=18&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) Condensed Consolidated Statement of Cash Flows (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | **Operating Activities** | | | | Profit for the period | 53,469 | 33,670 | | Operating cash flow before working capital changes | 137,859 | 51,018 | | Net cash generated from operating activities | 210,779 | 12,162 | | **Investing Activities** | | | | Net cash used in investing activities | (132,175) | (309,147) | | **Financing Activities** | | | | Net cash used in financing activities | (6,111) | (16,926) | | **Net increase (decrease) in cash and cash equivalents** | **72,493** | **(313,911)** | | Cash and cash equivalents at beginning of period | 755,032 | 1,340,918 | | Effect of exchange rate changes | 151 | 1,684 | | **Cash and cash equivalents at end of period** | **827,676** | **1,028,691** | [Notes to the Condensed Consolidated Financial Statements](index=20&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%E9%99%84%E8%A8%BB) This section provides detailed notes to the condensed consolidated financial statements, covering the company's general information, accounting policies, revenue composition, dividend policy, income tax calculation, profit for the period breakdown, earnings per share calculation, changes in investments in associates, financial asset classification, aging analysis of receivables and payables, and share capital structure, offering deeper context and explanations for the financial data [General Information and Basis of Preparation](index=20&type=section&id=%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99%E5%8F%8A%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) - Home Interactive Entertainment Technology Co, Ltd was incorporated in the Cayman Islands, and its shares have been listed on the Main Board of the Stock Exchange of Hong Kong Limited since July 4, 2019[54](index=54&type=chunk) - The Group is principally engaged in the development, publishing, and operation of mobile games in China[54](index=54&type=chunk) - The condensed consolidated financial statements are presented in RMB, which is also the functional currency of the Group[55](index=55&type=chunk) [Accounting Policies](index=20&type=section&id=%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) - The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments measured at fair value[57](index=57&type=chunk) - The accounting policies and methods of calculation adopted for the condensed consolidated financial statements for the six months ended June 30, 2025, are consistent with those presented in the annual financial statements for the year ended December 31, 2024[57](index=57&type=chunk) - During this interim period, the Group has first adopted the revised IFRS accounting standards that are mandatorily effective for annual periods beginning on or after January 1, 2025, which had no significant impact on the financial position and performance[58](index=58&type=chunk) [Revenue and Segment Information](index=21&type=section&id=%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) - Revenue refers to income from the sale of virtual tokens for self-developed mobile games, third-party mobile games, and advertising income[59](index=59&type=chunk) - The Group's operating activities are conducted by a single operating segment focused on mobile game development and operation[59](index=59&type=chunk) - Revenue from self-developed and third-party mobile games is recognized at the point in time when the customer obtains control of the service; advertising revenue is recognized when advertisements placed on third-party platforms are displayed in the game interface[59](index=59&type=chunk)[60](index=60&type=chunk) - The Group has a large number of customers, and no single customer accounted for 10% or more of the Group's revenue in either period[61](index=61&type=chunk) [Dividends](index=22&type=section&id=%E8%82%A1%E6%81%AF) - No dividends were declared and paid during this interim period[62](index=62&type=chunk) - In the previous interim period, a final dividend of HKD0.10 per share (equivalent to RMB0.09) for the year ended December 31, 2023, was declared and paid on July 11, 2024, totaling approximately RMB117,226,000[62](index=62&type=chunk) [Income Tax Expense](index=23&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income Tax Expense Analysis (For the Six Months Ended June 30) | Tax Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current tax—PRC corporate income tax | 19,542 | 21,835 | | Under-provision (over-provision) in prior years | 1,574 | (3,580) | | Deferred tax | (11,807) | (11,591) | | **Total** | **9,309** | **6,664** | - Yaotang (Xiamen) Network Technology Co, Ltd and Jilin Haiqi Network Technology Co, Ltd are recognized as "Double Software Enterprises," enjoying a two-year corporate income tax exemption followed by a three-year 50% tax rate reduction[64](index=64&type=chunk) - Yaotang (Shenzhen) Network Technology Co, Ltd obtained High-tech Enterprise certification, enjoying a preferential income tax rate of 15%[65](index=65&type=chunk) - Enterprises engaged in R&D activities are entitled to deduct 200% of R&D expenses incurred in the current year as deductible expenses (super deduction)[65](index=65&type=chunk) [Profit for the Period](index=24&type=section&id=%E6%9C%9F%E5%85%A7%E6%BA%A2%E5%88%A9) Profit for the Period Deductions (For the Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Commissions and fees charged by distribution channels and payment providers | 203,693 | 288,031 | | Depreciation of property, plant and equipment | 12,611 | 8,007 | | Depreciation of right-of-use assets | 3,603 | 5,530 | | Amortization of intangible assets | 16,133 | 470 | | Impairment losses under expected credit loss model | 34,275 | 6,285 | | Directors' remuneration | 5,092 | 8,108 | | Total other staff costs | 67,310 | 99,847 | [Earnings Per Share](index=25&type=section&id=%E6%AF%8F%E8%82%A1%E7%87%9F%E5%88%A9) Calculation of Basic and Diluted Earnings Per Share (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the purpose of calculating basic and diluted earnings per share: Profit for the period attributable to owners of the Company | 37,395 | 28,009 | | | | | | Number of Shares | 2025 (Unaudited) | 2024 (Unaudited) | | Weighted average number of ordinary shares for the purpose of calculating basic and diluted earnings per share | 1,226,335,488 | 1,254,914,473 | - Share awards had no impact on diluted earnings per share for the current and previous interim periods[70](index=70&type=chunk) [Investments in Associates](index=26&type=section&id=%E6%96%BC%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E7%9A%84%E6%8A%95%E8%B3%87) Investments in Associates (As of June 30) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of investments in associates | 58,538 | 61,100 | | Share of post-acquisition results (net of dividends received) | (6,523) | (6,180) | | **Total** | **52,015** | **54,920** | - During this interim period, investments were made in two new associates primarily engaged in game development, with a total consideration of **RMB850,000**[71](index=71&type=chunk) - During this interim period, interests in Chongqing Huangjiu Technology Co, Ltd and Guangzhou Yaoyang Technology Co, Ltd were disposed of for a total consideration of **RMB6,212,000**[71](index=71&type=chunk) - On June 1, 2025, a supplemental agreement was signed with an entity controlled by Mr Luo Wei, revising the repayment date for the outstanding consideration of RMB99,900,000 and recognizing a loss of **RMB10,351,000** due to the derecognition of receivables from the disposal of an associate[73](index=73&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=27&type=section&id=%E6%8C%89%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E9%87%8F%E4%B8%94%E5%85%B6%E8%AE%8A%E5%8B%95%E8%A8%88%E5%85%A5%E6%90%8D%E7%9B%8A%E4%B9%8B%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) Financial Assets at Fair Value Through Profit or Loss (As of June 30) | Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Non-current Unlisted Securities** | | | | —Investments in partnership enterprises | 26,766 | 31,243 | | **Current Listed Securities Held for Trading** | | | | —Equity securities on SSE | — | 25,696 | | **Current Unlisted Securities Held for Trading** | | | | —Private equity funds | 276,879 | 129,269 | | —Money market funds | 148,752 | 106,461 | | —Structured deposits | 20,426 | 132,300 | | **Total** | **446,057** | **393,726** | [Trade Receivables](index=28&type=section&id=%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) Aging Analysis of Trade Receivables (As of June 30) | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 30 days | 71,402 | 77,594 | | 31 to 60 days | 9,594 | 11,494 | | 61 to 90 days | 1,573 | 2,469 | | 91 to 180 days | 1,876 | 284 | | Over 180 days | 3,911 | 2,572 | | **Total** | **88,356** | **94,413** | - The credit period for trade receivables is generally **0 to 90 days**[77](index=77&type=chunk) - As of June 30, 2025, overdue balances of **RMB3,911,000** were overdue for 90 days or more but were not considered in default due to the debtors' cooperative history and good collection history[77](index=77&type=chunk) [Prepayments, Other Receivables and Deposits](index=29&type=section&id=%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85%E3%80%81%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%8C%89%E9%87%91) Prepayments, Other Receivables and Deposits (As of June 30) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Prepayments for co-operation commissions | 12,349 | 71,356 | | Prepayments for R&D expenses | 14,365 | 15,040 | | Prepayments for advertising and promotion expenses | 11,886 | 43,793 | | Prepayments to game developers | 11,630 | 5,863 | | Prepayments for game and server related expenses | 1,874 | 2,637 | | Loans to employees | 14,270 | 21,139 | | Lease and other deposits | 7,836 | 8,413 | | VAT and other recoverable taxes | 8,063 | 11,522 | | Loans to employees | 4,580 | 279 | | Other receivables | 12,972 | — | | Others | 8,049 | 12,439 | | **Total** | **107,874** | **192,481** | | Less: Provision for credit losses | (12,998) | (26) | | **Adjusted Total** | **94,876** | **192,455** | - The provision for credit losses is mainly for other receivables from co-operation commissions paid due to Chengdu Weiying facing significant financial difficulties[78](index=78&type=chunk) [Trade and Other Payables](index=30&type=section&id=%E8%B2%BF%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) Trade and Other Payables (As of June 30) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables | 36,986 | — | | Other payables | 52,358 | 55,114 | | **Total** | **89,344** | **55,114** | Aging Analysis of Trade Payables (As of June 30) | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 60 days | 6,778 | — | | 61 to 90 days | 8,409 | — | | Over 90 days | 21,799 | — | | **Total** | **36,986** | **—** | [Share Capital](index=30&type=section&id=%E8%82%A1%E6%9C%AC) - As of June 30, 2025, the authorized share capital was **10,000,000,000 ordinary shares** of USD0.000005 each, with a par value of USD50,000[79](index=79&type=chunk) - The issued and fully paid share capital was **1,283,403,500 ordinary shares** of USD0.000005 each, with a par value of USD6,417, equivalent to RMB42 thousand[79](index=79&type=chunk) [Other Information](index=31&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) This section discloses the company's share repurchase activities during the reporting period, confirms no significant events after the reporting period, highlights continuous compliance with corporate governance codes and directors' securities transaction standards, notes the audit committee's review of interim results, and states the decision not to declare an interim dividend to conserve capital for business development [Purchase, Sale and Redemption of the Company’s Listed Securities](index=31&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E5%8F%8A%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) - For the six months ended June 30, 2025, Futu Securities International (Hong Kong) Limited, as an independent trustee of the share award scheme, purchased **1,786,000 shares** in the open market for a total consideration of **RMB2,044,000**, for future grants under the share award scheme[80](index=80&type=chunk) - As of June 30, 2025, the Company and its subsidiaries did not hold any treasury shares[81](index=81&type=chunk) [Events After the Reporting Period](index=31&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) - No significant events affecting the Group have occurred from the end of the reporting period up to the date of this announcement[82](index=82&type=chunk) [Corporate Governance](index=31&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) - The Company has complied with the applicable code provisions of the Corporate Governance Code set out in Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited for the six months ended June 30, 2025[83](index=83&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors](index=31&type=section&id=%E9%81%B5%E5%AE%88%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E7%9A%84%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87) - Following specific enquiries by the Company, all Directors confirmed their compliance with the "Model Code for Securities Transactions by Directors of Listed Issuers" set out in Appendix C3 to the Listing Rules throughout the reporting period[84](index=84&type=chunk) [Audit Committee](index=32&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) - The Audit Committee comprises three independent non-executive Directors: Mr Hu Yangyang (Chairman), Mr Zhang Yuguo, and Ms Guo Ying[85](index=85&type=chunk) - The Audit Committee has reviewed the Company's unaudited condensed interim results for the reporting period and confirmed compliance with applicable accounting principles, standards, and requirements, with adequate disclosures made[85](index=85&type=chunk) [Changes in Directors’ Biographical Details under Rule 13.51B(1) of the Listing Rules](index=32&type=section&id=%E4%B8%8A%E5%B8%82%E8%A6%8F%E5%89%87%E7%AC%AC13.51B%20(1)%E6%A2%9D%E9%A0%85%E4%B8%8B%E8%91%A3%E4%BA%8B%E5%B1%A5%E6%AD%B7%E8%A9%B3%E6%83%85%E8%AE%8A%E5%8B%95) - There were no changes in Directors' biographical details requiring disclosure under Rule 13.51B(1) of the Listing Rules[86](index=86&type=chunk) [Interim Dividend](index=32&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 (2024: nil), to retain capital for strategic business development[87](index=87&type=chunk) [Publication of Interim Results and Interim Report](index=32&type=section&id=%E5%88%8A%E8%BC%89%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%8F%8A%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) - This announcement is published on the HKEX website and the Company's website, with the interim report to be published on both websites in due course[88](index=88&type=chunk)