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。 綠色動力環保集團股份有限公司 Dynagreen Environmental Protection Group Co., Ltd.* （於 中 華 人 民 共 和 國 註 冊 成 立 的 股 份 有 限 公 司） （股 份 代 號：1330） 二零二五年中期業績公告 綠色動力環保集團股份有限公司（「本公司」）董事會欣然宣佈本公司及其附屬 公 司 截 至 二 零 二 五 年 六 月 三 十 日 止 六 個 月 的 未 經 審 計 中 期 業 績。本 公 告 列 載 本 公 司 二 零 二 五 年 中 期 報 告 全 文，並 符 合 香 港 聯 合 交 易 所 有 限 公 司 證 券 上 市 規 則 中 有 關 中 期 業 績 初 步 公 告 附 載 的 資 料 的 要 求。本 公 司 二 零 二 五 年 中期報告將於二零二五年九月三十日或之前可在香港 ...

Financial Performance - Revenue for the six months ended June 30, 2025, was RMB 244,221,000, a decrease of 10.5% compared to RMB 272,784,000 for the same period in 2024[3] - Gross profit for the same period was RMB 100,188,000, representing a gross margin of 41.0%, compared to RMB 110,944,000 and a gross margin of 40.7% in 2024[3] - Operating loss improved to RMB 48,710,000, a reduction of 74.6% from an operating loss of RMB 191,995,000 in 2024[3] - Net loss for the period was RMB 29,309,000, significantly lower than the net loss of RMB 175,317,000 in the previous year, marking an 83.3% improvement[3] - Adjusted net loss (non-IFRS measure) was RMB 28,696,000, down 41.7% from RMB 49,253,000 in 2024[3] - The company reported a basic and diluted loss per share of RMB 0.04, compared to RMB 0.32 in the same period last year[4] - The company reported a net loss attributable to owners of RMB 22,802 thousand, significantly improved from a loss of RMB 171,126 thousand in the same period last year[19] - The net loss for the six months ended June 30, 2025, decreased by 83.3% to RMB 29.3 million from RMB 175.3 million for the same period in 2024[53] - Adjusted net loss (non-IFRS measure) for the six months ended June 30, 2025, was RMB 28.7 million, compared to RMB 49.3 million for the same period in 2024[54] Revenue Breakdown - Revenue from cloud software products increased to RMB 82,425 thousand for SaaS products, up 1.1% from RMB 81,564 thousand in 2024[15] - 38.7% of total revenue in the first half of 2025 came from sales of cloud software[33] - 61.2% of total revenue in the first half of 2025 was derived from providing digital services[36] - Revenue decreased by 10.5% from RMB 272.8 million for the six months ended June 30, 2024, to RMB 244.2 million for the six months ended June 30, 2025, primarily due to a decline in digital services revenue[27] - Cloud software sales revenue decreased by 3.0% from RMB 97.6 million to RMB 94.6 million, mainly due to a drop in custom product sales from RMB 16.0 million to RMB 12.2 million[43] - Digital services revenue fell by 14.8% from RMB 175.2 million to RMB 149.4 million, attributed to a challenging external environment and a strategic shift towards key clients[43] Cost and Expenses - Employee benefits expenses decreased to RMB 152,050 thousand, down 27.4% from RMB 209,643 thousand in 2024[16] - The total cost of sales and operating expenses for the six months was RMB 276,990 thousand, a reduction from RMB 481,108 thousand in 2024[16] - Selling expenses reduced by 26.6% from RMB 51.2 million to RMB 37.6 million, mainly due to a decrease in employee costs[46] - Administrative expenses decreased significantly by 73.4% from RMB 217.2 million to RMB 57.7 million, primarily due to a substantial reduction in share-based payments[47] - R&D expenses decreased by 26.0% from RMB 50.9 million to RMB 37.7 million, mainly due to a reduction in employee costs[48] Assets and Liabilities - Total assets as of June 30, 2025, were RMB 1,518,520,000, compared to RMB 1,583,197,000 as of December 31, 2024[7] - Total liabilities decreased to RMB 302,104,000 from RMB 348,624,000 in the previous year[8] - Cash and cash equivalents were RMB 253,013,000, down from RMB 319,297,000 as of June 30, 2024[7] - Non-current assets totaled RMB 84,465 thousand as of June 30, 2025, down from RMB 93,385 thousand at the end of 2024[14] - Trade receivables amounted to RMB 190,355 thousand, with a provision for impairment of RMB 25,401 thousand[22] - As of June 30, 2025, the company had current assets of RMB 1,170.8 million, with cash and cash equivalents amounting to RMB 253.0 million[55] - The current ratio as of June 30, 2025, was 5.66, compared to 5.05 as of December 31, 2024, indicating strong liquidity[55] Strategic Initiatives - The company plans to enhance AI research and development to improve overall technical strength and product competitiveness[37] - The introduction of AI-driven digital employee systems aims to transform clinical research processes and improve efficiency significantly[38] - The company is expanding internationally and establishing data and delivery centers in China, the U.S., and Singapore to support global clinical research needs[40] - The company is committed to expanding its market presence through strategic partnerships and collaborations in the healthcare sector[81] - The use of SaaS models is being explored to enhance service delivery and operational efficiency[86] - The company is actively involved in research and development to innovate new products and technologies in the medical field[82] Governance and Compliance - The company has adopted corporate governance codes to ensure shareholder rights and enhance corporate value[70] - There is currently no dividend policy in place, as the company intends to retain future profits for operations and business expansion[71] - The audit committee has reviewed the interim financial results for the six months ending June 30, 2025, and found them compliant with relevant accounting standards[74] - The company adheres to international financial reporting standards, which enhances transparency and accountability in financial reporting[82] - The board of directors consists of six executive directors and three independent non-executive directors, ensuring diverse governance[85] - The board is led by Chairman Zhao Lu, indicating strong leadership at the helm of the company[84] Future Plans and Use of Proceeds - The net proceeds from the global offering amounted to approximately HKD 259.5 million, allocated according to the intended use disclosed in the prospectus[67] - The company plans to allocate HKD 90.8 million (35%) of the net proceeds to improve and upgrade its TrialOS and PharmaOS platforms by December 31, 2029[68] - A total of HKD 77.9 million (30%) is designated to enhance core technology and R&D capabilities, expected to be utilized by December 31, 2029[68] - The company intends to strengthen its sales and marketing capabilities with an allocation of HKD 26.0 million (10%), also targeted for completion by December 31, 2029[68] - Strategic investments and acquisitions are planned with an allocation of HKD 38.9 million (15%), to be utilized by December 31, 2029[68] - Operating capital and general corporate purposes will receive HKD 25.9 million (10%), with a timeline extending to December 31, 2029[68] - The total net proceeds amount to HKD 259.5 million, with HKD 254.2 million remaining unutilized as of June 30, 2025[68]

[Company Information](index=3&type=section&id=Company%20Information) This section outlines the company's governance structure, key personnel, registered offices, financial partners, and public listing details [Board of Directors](index=3&type=section&id=Board%20of%20Directors) The Board of Directors comprises executive directors Kong Kin Man (Chairman), Kong Kin To (CEO), Kong Kin Nam, Choi Fung Ka, and independent non-executive directors Tam Chun Fai, Lo Yiu Wing, Wong Man Ming, with a change in company secretary on July 25, 2025 - Executive Directors include **Kong Kin Man (Chairman)**, **Kong Kin To (CEO)**, **Kong Kin Nam**, and **Choi Fung Ka**[7](index=7&type=chunk) - Independent Non-Executive Directors are **Tam Chun Fai**, **Lo Yiu Wing**, and **Wong Man Ming**[7](index=7&type=chunk) - The Company Secretary, Chan Kin Wai, resigned on July 25, 2025, and **Chan Sze Yin** was appointed[7](index=7&type=chunk) [Audit Committee](index=3&type=section&id=Audit%20Committee) The Audit Committee members include Tam Chun Fai (Chairman), Lo Yiu Wing, and Wong Man Ming, all of whom are independent non-executive directors - The Audit Committee is composed of **Tam Chun Fai (Chairman)**, **Lo Yiu Wing**, and **Wong Man Ming**[7](index=7&type=chunk) [Remuneration Committee](index=3&type=section&id=Remuneration%20Committee) The Remuneration Committee members include Tam Chun Fai (Chairman), Kong Kin Man, Lo Yiu Wing, and Wong Man Ming - The Remuneration Committee is composed of **Tam Chun Fai (Chairman)**, **Kong Kin Man**, **Lo Yiu Wing**, and **Wong Man Ming**[7](index=7&type=chunk) [Nomination Committee](index=3&type=section&id=Nomination%20Committee) The Nomination Committee members include Kong Kin Man (Chairman), Tam Chun Fai, Lo Yiu Wing, and Wong Man Ming - The Nomination Committee is composed of **Kong Kin Man (Chairman)**, **Tam Chun Fai**, **Lo Yiu Wing**, and **Wong Man Ming**[7](index=7&type=chunk) [Registered Office and Principal Place of Business](index=3&type=section&id=Registered%20Office%20and%20Principal%20Place%20of%20Business) The company's registered office is in the Cayman Islands, and its principal place of business in Hong Kong is located at Room 1301, 13th Floor, Harcourt House, 39 Gloucester Road, Wan Chai, Hong Kong - The registered office is located at Cricket Square, Cayman Islands[7](index=7&type=chunk) - The principal place of business in Hong Kong is located at Room 1301, 13th Floor, Harcourt House, 39 Gloucester Road, Wan Chai, Hong Kong[7](index=7&type=chunk) [Share Registrar](index=3&type=section&id=Share%20Registrar) The principal share registrar and transfer office is Suntera (Cayman) Limited, and the Hong Kong branch share registrar and transfer office is Hong Kong Registrars Limited - The principal share registrar and transfer office is **Suntera (Cayman) Limited**[7](index=7&type=chunk) - The Hong Kong branch share registrar and transfer office is **Hong Kong Registrars Limited**[8](index=8&type=chunk) [Principal Bankers](index=3&type=section&id=Principal%20Bankers) The company's principal bankers include Agricultural Bank of China, China Construction Bank, China Minsheng Bank, Hang Seng Bank, Industrial and Commercial Bank of China (Asia), Shanghai Pudong Development Bank, Standard Chartered Bank, Bank of East Asia, and The Hongkong and Shanghai Banking Corporation Limited - Principal bankers include **Agricultural Bank of China**, **China Construction Bank**, **China Minsheng Bank**, **Hang Seng Bank**, **Industrial and Commercial Bank of China (Asia)**, **Shanghai Pudong Development Bank**, **Standard Chartered Bank**, **Bank of East Asia**, and **The Hongkong and Shanghai Banking Corporation Limited**[8](index=8&type=chunk) [Auditor and Legal Advisers](index=3&type=section&id=Auditor%20and%20Legal%20Advisers) The company's auditor is BDO Limited, and its legal advisers include Sidley Austin (Hong Kong law) and Conyers Dill & Pearman (Cayman Islands law) - The auditor is **BDO Limited**[8](index=8&type=chunk) - Legal advisers include **Sidley Austin (Hong Kong law)** and **Conyers Dill & Pearman (Cayman Islands law)**[8](index=8&type=chunk) [Website and Stock Code](index=3&type=section&id=Website%20and%20Stock%20Code) The company's website is www.kwggroupholdings.com, and its stock code is 1813 (Main Board of The Stock Exchange of Hong Kong Limited) - The company's website is **www.kwggroupholdings.com**[8](index=8&type=chunk) - The stock code is **1813 (Main Board of The Stock Exchange of Hong Kong Limited)**[8](index=8&type=chunk) [Company Profile](index=4&type=section&id=Company%20Profile) KWG Group Holdings Limited, established in 1995 and listed in Hong Kong in 2007, is a leading urban comprehensive operator in China, focusing on first and second-tier cities with diversified businesses and a commitment to ESG - KWG Group was established in 1995 and listed on the Main Board of the Hong Kong Stock Exchange in July 2007 (Stock Code: 01813.HK)[9](index=9&type=chunk) - The company is positioned as a leading urban comprehensive operator in China, with a strategy of "Rooted in Guangzhou, Radiating Nationwide," focusing on first and second-tier cities, deeply cultivating the Guangdong-Hong Kong-Macao Greater Bay Area and Yangtze River Delta regions, and covering important urban economic circles such as the Bohai Rim and Central and Western regions, with a presence in over 40 cities[9](index=9&type=chunk) - The product portfolio covers mid-to-high-end residential, serviced apartments, villas, office buildings, hotels, and shopping centers, with property development and commercial operations as the main businesses, complemented by diversified business segments such as education and healthcare[9](index=9&type=chunk) - The future outlook focuses on residential and commercial property development, with a commitment to Environmental, Social and Governance (ESG) practices for sustainable development[9](index=9&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) This section reviews the group's financial performance, liquidity, market conditions, business operations, and future outlook [Financial Review](index=5&type=section&id=Financial%20Review) In the first half of 2025, the Group's revenue decreased by 27.5% year-on-year to RMB 3,792.3 million, primarily due to a comprehensive decline in property development, property investment, and hotel operations revenue; gross profit decreased by 4.4%, and other income and net gains significantly decreased by 94.2%; loss for the period significantly narrowed to RMB 2,171.7 million, mainly benefiting from income tax credit and reduced finance costs 2025 H1 Revenue Overview | Metric | 2025 H1 (RMB million) | 2024 H1 (RMB million) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 3,792.3 | 5,234.0 | -27.5% | | Property Development Revenue | 3,072.6 | 4,421.2 | -30.5% | | Property Investment Revenue | 406.1 | 447.4 | -9.2% | | Hotel Operations Revenue | 313.6 | 365.4 | -14.2% | - The decrease in property development revenue was mainly due to a reduction in total GFA delivered from **398,698 square meters** in the first half of 2024 to **348,103 square meters** in the same period of 2025, and a decrease in average selling price from **RMB 11,089 yuan/square meter** to **RMB 8,827 yuan/square meter**, primarily driven by price reduction promotions to accelerate inventory destocking[14](index=14&type=chunk) - The decrease in property investment and hotel operations revenue was mainly due to the overall downward economic environment, leading to a decrease in leasing volume and hotel occupancy rates[15](index=15&type=chunk)[16](index=16&type=chunk) 2025 H1 Key Financial Performance | Metric | 2025 H1 (RMB million) | 2024 H1 (RMB million) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | | Cost of sales | 3,698.8 | 5,136.1 | -28.0% | | Gross profit | 93.5 | 97.8 | -4.4% | | Other income and net gains | 29.7 | 510.0 | -94.2% | | Selling and marketing expenses | 342.0 | 453.6 | -24.6% | | Administrative expenses | 642.2 | 745.5 | -13.9% | | Other operating expenses | 255.1 | 3,917.5 | -93.5% | | Net fair value loss on investment properties | 122.0 | 470.9 | -74.1% | | Finance costs | 1,008.1 | 1,910.5 | -47.3% | | Share of loss of joint ventures | 873.7 | 923.8 | -5.4% | | Income tax credit/(expense) | 990.1 (credit) | 313.9 (expense) | Significant Improvement | | Loss for the period | 2,171.7 | 8,133.0 | -73.3% | - Cost of sales decreased by **28.0%**, mainly due to a decrease in the total GFA of properties delivered[18](index=18&type=chunk) - Other operating expenses significantly decreased by **93.5%**, primarily due to a reduction in impairment losses on properties under development[25](index=25&type=chunk) - Loss for the period significantly narrowed

Interim Results Announcement [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) The Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025, show a shift from profit to loss, primarily due to reduced one-off gains from subsidiary disposals and increased operating costs, alongside significant increases in current liabilities and interest-bearing borrowings [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2025, the Group shifted from profit to loss, as revenue growth failed to offset increased cost of sales, distribution costs, and administrative expenses, coupled with a significant reduction in one-off gains from subsidiary disposals in the prior period Key Figures from Condensed Consolidated Statement of Profit or Loss (RMB thousands) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 47,222 | 36,729 | +28.6% | | Cost of Sales and Services | (40,410) | (29,908) | +35.1% | | Gross Profit | 6,812 | 6,821 | -0.1% | | Other (Losses) Income and Other (Losses) Gains, Net | (220) | 2,863 | -107.7% | | Distribution Costs | (4,256) | (2,060) | +106.6% | | Administrative and Other Expenses | (14,517) | (12,131) | +19.7% | | Net Gain on Disposal of Subsidiaries | 606 | 17,043 | -96.4% | | Finance Costs | (1,265) | (1,078) | +17.3% | | (Loss) Profit Before Income Tax | (12,708) | 11,142 | -214.1% | | (Loss) Profit for the Period | (13,379) | 9,655 | -238.6% | | (Loss) Profit for the Period Attributable to Owners of the Company | (10,861) | 9,971 | -208.9% | | Basic (Loss) Earnings Per Share (RMB cents) | (7.10) | 7.24 | -208.6% | [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the period, the Group recorded a total comprehensive loss of RMB 18,485 thousand, a significant deterioration from the prior period's total comprehensive income of RMB 5,230 thousand, mainly due to the loss for the period and increased exchange differences on translation of overseas operations Key Figures from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (RMB thousands) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | (Loss) Profit for the Period | (13,379) | 9,655 | -238.6% | | Exchange Differences on Translation of Overseas Operations | (5,106) | (4,425) | +15.4% | | Total Comprehensive (Loss) Income for the Period | (18,485) | 5,230 | -453.5% | | Total Comprehensive (Loss) Income for the Period Attributable to Owners of the Company | (15,967) | 5,546 | -387.9% | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's net assets decreased, current liabilities significantly increased, leading to a reduction in net current assets and pressure on the asset-liability structure Key Figures from Condensed Consolidated Statement of Financial Position (RMB thousands) | Metric | As of June 30, 2025 | As of December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | 102,500 | 103,421 | -0.9% | | Current Assets | 377,015 | 365,543 | +3.1% | | Current Liabilities | 142,899 | 114,233 | +25.1% | | Net Current Assets | 234,116 | 251,310 | -6.9% | | Non-current Liabilities | 3,368 | 3,125 | +7.8% | | Net Assets | 333,248 | 351,606 | -5.3% | | Equity Attributable to Owners of the Company | 306,022 | 321,987 | -5.0% | | Total Equity | 333,248 | 351,606 | -5.2% | | Cash and Cash Equivalents | 351,235 | 340,426 | +3.2% | | Trade and Other Receivables | 17,588 | 14,993 | +17.3% | | Trade and Other Payables | 86,674 | 74,003 | +17.1% | | Interest-bearing Borrowings | 56,729 | 40,426 | +40.3% | [Notes](index=6&type=section&id=Notes) This section details the Group's operations, basis of financial statement preparation, accounting policies, segment information, revenue composition, taxation, dividends, earnings per share calculation, asset and liability changes, subsidiary disposals, capital reorganization, and related party transactions, providing crucial supplementary information for understanding the financial statements [1. General Information](index=6&type=section&id=1.%20General%20Information) Sanai Health Industry Group Co Ltd is incorporated in the Cayman Islands and listed on the Hong Kong Stock Exchange, primarily engaged in the development, manufacturing, marketing, and sales of pharmaceutical products, and providing finance lease services, with financial statements presented in RMB - The company is an investment holding company, with principal businesses including pharmaceutical products and finance lease services[9](index=9&type=chunk) - Shares were listed on the Main Board of the Hong Kong Stock Exchange on February 1, 2007[9](index=9&type=chunk) [2. Basis of Preparation](index=6&type=section&id=2.%20Basis%20of%20Preparation) The unaudited condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' and the Listing Rules of the Stock Exchange, using the historical cost convention and consistent with the accounting policies and methods used in the 2024 audited financial statements - Financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the Listing Rules of the Stock Exchange[10](index=10&type=chunk) - Accounting policies used for preparation are consistent with the 2024 audited financial statements[10](index=10&type=chunk) [3. Adoption of New and Revised Hong Kong Financial Reporting Standards](index=7&type=section&id=3.%20Adoption%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group has adopted all new and revised Hong Kong Financial Reporting Standards effective January 1, 2025, with no significant changes to accounting policies, financial statement presentation, or reported amounts resulting from these adoptions - The adoption of new and revised Hong Kong Financial Reporting Standards did not result in significant changes to accounting policies or financial statement presentation[11](index=11&type=chunk) [4. Segment Information](index=7&type=section&id=4.%20Segment%20Information) The Group primarily operates in two reportable segments: pharmaceutical products and finance lease, with pharmaceutical products showing significant revenue growth but expanded losses, while the finance lease segment generated zero revenue, and the gene testing and molecular biological diagnostic services segment ceased operations in the second half of 2024 - The Group has two reportable segments: pharmaceutical products and finance lease[12](index=12&type=chunk) Segment Revenue and (Loss) Profit (RMB thousands) | Segment | Revenue for the six months ended June 30, 2025 | Revenue for the six months ended June 30, 2024 | Loss for the six months ended June 30, 2025 | (Loss) Profit for the six months ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Pharmaceutical Products | 47,222 | 31,010 | (5,721) | (779) | | Finance Lease | – | – | – | (303) | | Gene Testing and Molecular Biological Diagnostic Services | – | 5,719 | – | 173 | | Total | 47,222 | 36,729 | (5,721) | (909) | - The gene testing and molecular biological diagnostic services segment ceased operations in the second half of 2024[13](index=13&type=chunk)[19](index=19&type=chunk) Revenue from External Customers by Geographical Location (RMB thousands) | Region | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Hong Kong | – | 5,719 | | People's Republic of China ("China") | 47,222 | 31,010 | | Total | 47,222 | 36,729 | [5. Revenue](index=11&type=section&id=5.%20Revenue) Revenue for the period primarily derived from pharmaceutical product sales, totaling RMB 47,222 thousand, a 28.6% increase from the prior period, with revenue from gene testing and molecular biological diagnostic services having ceased Revenue by Category (RMB thousands) | Revenue Category | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Sales of Pharmaceutical Products | 47,222 | 31,010 | | Provision of Gene Testing and Molecular Biological Diagnostic Services | – | 5,719 | | Total | 47,222 | 36,729 | [6. (Loss) Profit for the Period](index=11&type=section&id=6.%20(Loss)%20Profit%20for%20the%20Period) The loss for the period was primarily impacted by increased finance costs, higher depreciation of property, plant and equipment, and rising inventory costs Items Deducted in Calculating (Loss) Profit for the Period (RMB thousands) | Item | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Finance Costs | 1,265 | 1,078 | | Depreciation of Property, Plant and Equipment | 1,088 | 545 | | Amortisation of Intangible Assets | – | 24 | | Cost of Inventories | 33,296 | 24,960 | [7. Income Tax Expense](index=12&type=section&id=7.%20Income%20Tax%20Expense) Income tax expense for the period was RMB 671 thousand, a decrease from RMB 1,487 thousand in the prior period, mainly due to reduced PRC corporate income tax and no provision for Hong Kong profits tax due to the absence of assessable profits Income Tax Expense (RMB thousands) | Tax Category | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | PRC Corporate Income Tax | 143 | 1,522 | | Deferred Tax | 528 | (82) | | Hong Kong Profits Tax | – | 47 | | Total | 671 | 1,487 | - Beijing Hangyang, as a high-tech enterprise, enjoys a preferential tax rate of **15%**[25](index=25&type=chunk) - No Hong Kong profits tax provision was made for the period as Hong Kong subsidiaries had no assessable profits[26](index=26&type=chunk) [8. Dividends](index=12&type=section&id=8.%20Dividends) The Board does not recommend the payment of any dividends for the six months ended June 30, 2025, and 2024 - The Board does not recommend the payment of an interim dividend[27](index=27&type=chunk) [9. (Loss) Earnings Per Share](index=13&type=section&id=9.%20(Loss)%20Earnings%20Per%20Share) For the six months ended June 30, 2025, both basic and diluted loss per share were RMB 7.10 cents, compared to earnings per share of RMB 7.24 cents in the prior period, primarily reflecting the shift from profit to loss (Loss) Earnings Per Share (RMB cents) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Basic (Loss) Earnings | (7.10) | 7.24 | | Diluted (Loss) Earnings | (7.10) | 7.24 | Data Used for Calculating (Loss) Earnings Per Share (RMB thousands/thousands of shares) | Item | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | (Loss) Profit for the Period Attributable to Owners of the Company | (10,861) | 9,971 | | Weighted Average Number of Ordinary Shares | 152,899 | 137,693 | [10. Property, Plant and Equipment and Right-of-use Assets](index=14&type=section&id=10.%20Property,%20Plant%20and%20Equipment%20and%20Right-of-use%20Assets) During the period, the Group acquired property, plant and equipment of approximately RMB 41 thousand and disposed of property, plant and equipment of approximately RMB 29 thousand through the disposal of subsidiaries - Acquisition of property, plant and equipment amounted to approximately **RMB 41 thousand** during the period[30](index=30&type=chunk) - Disposal of property, plant and equipment through the sale of subsidiaries amounted to approximately **RMB 29 thousand**[30](index=30&type=chunk) [11. Trade and Other Receivables](index=14&type=section&id=11.%20Trade%20and%20Other%20Receivables) As of June 30, 2025, total trade and other receivables amounted to RMB 17,588 thousand, an increase from December 31, 2024, primarily due to higher other receivables Trade and Other Receivables (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Trade Receivables (net of loss allowance) | 8,656 | 9,560 | | Other Receivables | 7,603 | 3,190 | | Prepayments and Deposits | 925 | 1,832 | | Total | 17,588 | 14,993 | - The Group generally grants credit periods of **30 to 180 days** to customers[31](index=31&type=chunk) [12. Trade and Other Payables](index=15&type=section&id=12.%20Trade%20and%20Other%20Payables) As of June 30, 2025, total trade and other payables amounted to RMB 86,674 thousand, a significant increase from December 31, 2024, primarily due to higher other payables and interest payable Trade and Other Payables (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Trade Payables | 12,864 | 14,285 | | Other Payables | 54,207 | 36,322 | | Interest Payable | 2,152 | 1,272 | | Total | 86,674 | 74,003 | [13. Interest-bearing Borrowings](index=16&type=section&id=13.%20Interest-bearing%20Borrowings) As of June 30, 2025, the Group's total interest-bearing borrowings amounted to RMB 56,729 thousand, a substantial increase from December 31, 2024, primarily driven by growth in unsecured bank and other borrowings Interest-bearing Borrowings (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Unsecured Bank and Other Borrowings | 31,229 | 13,426 | | Secured and Guaranteed Bank Borrowings | 25,500 | 27,000 | | Total | 56,729 | 40,426 | - Unsecured borrowings bear interest at fixed annual rates ranging from **3% to 12%**[37](index=37&type=chunk) - Secured borrowings are pledged and guaranteed by right-of-use assets[37](index=37&type=chunk) [14. Disposal of Subsidiaries](index=17&type=section&id=14.%20Disposal%20of%20Subsidiaries) During the period, the Group disposed of 100% equity in Fujian Zhixin Pharmaceutical Co Ltd and indirect equity in two companies held by Beijing Hangyang Information Technology Co Ltd, generating gains, while the prior period also saw multiple subsidiary disposals, including Zentrogene Group, which yielded significant gains - On March 28, 2025, **100%** equity in Fujian Zhixin Pharmaceutical Co Ltd was disposed of for a cash consideration of **RMB 300 thousand**[38](index=38&type=chunk) - On January 17, 2025, Beijing Hangyang indirectly disposed of **55%** equity in Beijing Sanai Baicheng Commercial Management Co Ltd and **74%** equity in Zhongshi Haowu (Beijing) International Culture and Tourism Co Ltd for a total cash consideration of **RMB 150 thousand**[39](index=39&type=chunk)[40](index=40&type=chunk) - In the prior period of 2024, **51%** equity in Fujian Yongchun Pharmaceutical Co Ltd, **100%** equity in Jianwei Electronics (Hong Kong) Co Ltd, and **59%** equity in Zentrogene Group were disposed of, with the Zentrogene disposal generating a gain of **RMB 17,167 thousand**[41](index=41&type=chunk)[42](index=42&type=chunk)[44](index=44&type=chunk) [15. Share Capital](index=22&type=section&id=15.%20Share%20Capital) The Company completed a share consolidation on August 13, 2024, and a capital reduction and share subdivision on February 3, 2025, resulting in a decrease in par value per share from HK$0.25 to HK$0.01, while the number of issued ordinary shares remained unchanged - The share consolidation became effective on August 13, 2024, where every **25** ordinary shares of HK$0.01 par value were consolidated into **1** share of HK$0.25 par value[46](index=46&type=chunk) - The capital reduction and share subdivision became effective on February 3, 2025, reducing the par value per share from **HK$0.25 to HK$0.01**[46](index=46&type=chunk) Changes in Share Capital (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Share Capital as presented in the Condensed Consolidated Statement of Financial Position | 1,421 | 35,534 | [16. Significant Related Party Transactions](index=23&type=section&id=16.%20Significant%20Related%20Party%20Transactions) For the six months ended June 30, 2025, key management personnel compensation, representing amounts paid to the Company's directors, was RMB 1,197 thousand, a slight decrease from the prior period Key Management Personnel Compensation (RMB thousands) | Item | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Short-term Employee Benefits | 1,197 | 1,245 | [Management Discussion and Analysis](index=24&type=section&id=Management%20Discussion%20and%20Analysis) The Management Discussion and Analysis section provides a detailed review of the Group's core pharmaceutical products and finance lease businesses, outlines future prospects, and offers in-depth analysis of key aspects including financial performance, liquidity, capital structure, employee matters, significant litigation, and corporate governance [Business Review](index=24&type=section&id=Business%20Review) The Group primarily engages in pharmaceutical products and finance lease businesses, with pharmaceutical products benefiting from the Beijing Hangyang acquisition for revenue growth, though gross margin was impacted by rising traditional Chinese medicine costs, while the finance lease business generated zero revenue due to a cautious strategy and no new contracts [Pharmaceutical Products Business](index=24&type=section&id=Pharmaceutical%20Products%20Business) Pharmaceutical products business revenue grew by **52.3%** to approximately **RMB 47.22 million**, primarily due to Beijing Hangyang's contribution, but rising traditional Chinese medicine costs continued to adversely affect gross margin and sales volume, expanding the business loss to **RMB 5.72 million** - Pharmaceutical products business revenue increased by **52.3%** to approximately **RMB 47.22 million**[50](index=50&type=chunk) - Beijing Hangyang became a significant revenue source for the pharmaceutical products business, accounting for approximately **64.48%** of total revenue[49](index=49&type=chunk) - Significant increases in the cost of traditional Chinese medicinal materials and supply shortages continued to adversely affect gross margin and sales volume[49](index=49&type=chunk) - The pharmaceutical products business loss expanded to approximately **RMB 5.72 million**, compared to a loss of **RMB 0.78 million** in the prior period[50](index=50&type=chunk) [Finance Lease Business](index=25&type=section&id=Finance%20Lease%20Business) Finance lease business revenue was zero for the period as all existing contracts expired and no new contracts were entered into, with the Group adopting a more cautious approach to new finance lease loans, primarily offering finance lease services for medical devices and rehabilitation equipment - Finance lease business revenue was **zero** for the period, as all existing contracts expired and no new contracts were entered into[51](index=51&type=chunk) - The Group adopted a more cautious approach to evaluating and granting new finance lease loans[51](index=51&type=chunk) - The finance lease business primarily provides finance lease services for medical devices and rehabilitation equipment, with strict approval procedures and risk management measures in place[52](index=52&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk) [Prospects](index=27&type=section&id=Prospects) The Company will continue to focus on China's macroeconomic environment, actively assess opportunities and challenges, and enhance financial performance and implement cost controls through digital transformation and operational efficiency improvements, with pharmaceutical products business expected to maintain stable growth despite ongoing gross margin pressure from traditional Chinese medicine costs, and the finance lease business continuing a cautious approach - The Company's strategy focuses on China's macroeconomic environment, exploring new business investment opportunities, and enhancing market position[57](index=57&type=chunk) - Strict cost control measures will be implemented, with investments in digital transformation and operational efficiency to enhance productivity and reduce costs[58](index=58&type=chunk) - The pharmaceutical products business is expected to maintain stable growth in the second half of 2025, but gross margin will continue to be adversely affected by traditional Chinese medicine costs[58](index=58&type=chunk) - The finance lease business will continue to adopt a cautious approach, closely monitoring market developments and interest rate trends[58](index=58&type=chunk) [Financial Performance Review](index=29&type=section&id=Financial%20Performance%20Review) During the period, the Group's revenue grew, but distribution and administrative expenses significantly increased, and gross margin declined, ultimately resulting in a loss attributable to owners of the Company, a stark contrast to the profit in the prior period [Revenue](index=29&type=section&id=Revenue) The Group's total revenue was approximately **RMB 47.22 million**, an increase of approximately **28.6%** from the prior period, primarily due to increased revenue from pharmaceutical product sales by Beijing Hangyang Total Revenue (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 47.22 | 36.73 | +28.6% | - The increase in revenue was primarily due to increased revenue from pharmaceutical product sales by Beijing Hangyang during the period[59](index=59&type=chunk) [Distribution Costs](index=29&type=section&id=Distribution%20Costs) Distribution costs were approximately **RMB 4.26 million**, a significant increase of **106.6%** from the prior period, mainly due to new marketing and promotional activities, and the full recognition of Beijing Hangyang's sales and marketing expenses Distribution Costs (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Distribution Costs | 4.26 | 2.06 | +106.6% | - The increase was primarily due to new marketing activities, promotional activities, and the full recognition of Beijing Hangyang's sales and marketing expenses[60](index=60&type=chunk) [Administrative Expenses](index=29&type=section&id=Administrative%20Expenses) Administrative expenses were approximately **RMB 14.52 million**, an increase of approximately **19.7%** from the prior period, mainly due to the full recognition of Beijing Hangyang's administrative expenses, commensurate with revenue growth Administrative Expenses (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 14.52 | 12.13 | +19.7% | - The increase was primarily due to the full recognition of Beijing Hangyang's administrative expenses, commensurate with the percentage increase in revenue[61](index=61&type=chunk) [Gross Profit and Gross Margin](index=29&type=section&id=Gross%20Profit%20and%20Gross%20Margin) Gross profit was approximately **RMB 6.81 million**, with a gross margin of **14.4%**, a decrease from **18.6%** in the prior period, primarily attributable to the continuous decline in gross margin for self-owned and self-produced pharmaceutical products Gross Profit and Gross Margin (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 6.81 | 6.82 | -0.1% | | Gross Margin | 14.4% | 18.6% | -4.2 percentage points | - The decrease in gross margin was primarily attributable to the continuous decline in gross margin for self-owned and self-produced pharmaceutical products[62](index=62&type=chunk) [Finance Costs](index=30&type=section&id=Finance%20Costs) Finance costs were approximately **RMB 1.27 million**, an increase from **RMB 1.08 million** in the prior period, primarily presented as interest expenses attributable to interest-bearing borrowings Finance Costs (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Finance Costs | 1.27 | 1.08 | +17.6% | - Finance costs primarily represent interest expenses attributable to interest-bearing borrowings[63](index=63&type=chunk) [Loss for the Period](index=30&type=section&id=Loss%20for%20the%20Period) The loss attributable to owners of the Company was approximately **RMB 10.86 million**, compared to a profit of approximately **RMB 9.97 million** in the prior period, mainly due to a reduction in the significant one-off net gain from subsidiary disposals in the prior period, and increased distribution and administrative expenses attributable to Beijing Hangyang (Loss) Profit for the Period Attributable to Owners of the Company (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | (Loss) Profit for the Period Attributable to Owners of the Company | (10.86) | 9.97 | -208.9% | - The change was primarily due to a significant one-off net gain of approximately **RMB 17.04 million** from the disposal of subsidiaries recorded in the prior period of 2024[64](index=64&type=chunk) - Distribution and administrative expenses attributable to Beijing Hangyang collectively increased by approximately **RMB 4.6 million**[64](index=64&type=chunk) [Basic and Diluted Loss Per Share](index=30&type=section&id=Basic%20and%20Diluted%20Loss%20Per%20Share) For the six months ended June 30, 2025, both basic and diluted loss per share were approximately **RMB 7.10 cents**, compared to basic and diluted earnings per share of approximately **RMB 7.24 cents** in the prior period Basic and Diluted (Loss) Earnings Per Share (RMB cents) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Basic (Loss) Earnings Per Share | (7.10) | 7.24 | | Diluted (Loss) Earnings Per Share | (7.10) | 7.24 | [Liquidity and Financial Resources](index=30&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's cash and cash equivalents slightly increased, but the gearing ratio significantly rose, indicating increased financial leverage, with most transactions conducted in RMB, posing minimal exchange rate fluctuation risk [Cash and Cash Equivalents](index=30&type=section&id=Cash%20and%20Cash%20Equivalents) As of June 30, 2025, the Group's cash and cash equivalents were approximately **RMB 351.24 million**, a slight increase from December 31, 2024, primarily denominated in RMB and HKD Cash and Cash Equivalents (RMB millions) | Metric | As of June 30, 2025 | As of December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 351.24 | 340.43 | +3.2% | [Capital Structure and Gearing Ratio](index=30&type=section&id=Capital%20Structure%20and%20Gearing%20Ratio) As of June 30, 2025, equity attributable to owners of the Company was approximately **RMB 306.02 million**, with a gearing ratio of approximately **42.82%**, a significant increase from **32.97%** on December 31, 2024, reflecting higher debt levels Capital Structure and Gearing Ratio | Metric | As of June 30, 2025 | As of December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Equity Attributable to Owners of the Company (RMB millions) | 306.02 | 321.99 | -5.0% | | Gearing Ratio | 42.82% | 32.97% | +9.85 percentage points | [Foreign Exchange Fluctuation Risk](index=31&type=section&id=Foreign%20Exchange%20Fluctuation%20Risk) Most of the Group's business transactions are conducted in RMB, with no significant foreign exchange fluctuation difficulties encountered during the period, no material interest rate or exchange rate risks, and no hedging financial derivatives held - Most of the Group's business transactions are conducted in RMB, and no significant foreign exchange fluctuation difficulties were encountered[69](index=69&type=chunk) - There were no material interest rate or exchange rate risks during the period, nor were any hedging financial derivatives held[69](index=69&type=chunk) [Other Significant Matters](index=31&type=section&id=Other%20Significant%20Matters) This section covers no significant acquisitions or disposals, changes in employee numbers and remuneration, no material capital expenditures or contingent liabilities, dividend policy, share option scheme adjustments, progress of significant litigation, director changes, and corporate governance compliance during the period [Significant Acquisitions and Disposals of Investments](index=31&type=section&id=Significant%20Acquisitions%20and%20Disposals%20of%20Investments) During the period, the Group did not undertake any significant acquisitions or disposals of investments - No significant acquisitions or disposals of investments were undertaken during the period[70](index=70&type=chunk) [Employees and Remuneration](index=31&type=section&id=Employees%20and%20Remuneration) As of June 30, 2025, the Group employed approximately **147** employees, a decrease from the prior period, but total staff costs were approximately **RMB 6.22 million**, an increase from the prior period Employees and Remuneration | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Number of Employees | 147 | 156 | -9 | | Total Staff Costs (RMB millions) | 6.22 | 4.84 | +28.5% | [Capital Expenditure](index=31&type=section&id=Capital%20Expenditure) For the six months ended June 30, 2025, the Group incurred no significant capital expenditure on property, plant and equipment - No significant capital expenditure on property, plant and equipment was incurred during the period[72](index=72&type=chunk) [Pledge of the Group's Assets](index=32&type=section&id=Pledge%20of%20the%20Group's%20Assets) As of June 30, 2025, no other assets of the Group were pledged as collateral for borrowings, except for those disclosed in Note 13 for interest-bearing borrowings - No other assets were pledged as collateral, except as disclosed in Note 13[73](index=73&type=chunk) [Contingent Liabilities](index=32&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - The Group had no significant contingent liabilities[74](index=74&type=chunk) [Future Plans for Material Investments, Acquisitions and Capital Assets](index=32&type=section&id=Future%20Plans%20for%20Material%20Investments,%20Acquisitions%20and%20Capital%20Assets) Other than those disclosed in this announcement, the Group had no other plans for material investments, acquisitions, and capital assets during the period - No other plans for material investments, acquisitions, and capital assets were in place during the period[75](index=75&type=chunk) [Dividends](index=32&type=section&id=Dividends) The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend[76](index=76&type=chunk) [Share Option Scheme](index=32&type=section&id=Share%20Option%20Scheme) The Company has a new share option scheme aimed at incentivizing employees, with the number of share options and exercise price adjusted on August 13, 2024, due to a share consolidation, and no new share options granted during the period - The new share option scheme was adopted on June 16, 2017, with a **ten-year validity**, aiming to attract, retain, and incentivize employees[77](index=77&type=chunk) - Due to the share consolidation, the number of share options was adjusted from **132,722,250** to **5,308,890**, and the exercise price from **HK$0.084** to **HK$2.10**[79](index=79&type=chunk)[80](index=80&type=chunk) - No share options were granted during the period[79](index=79&type=chunk) [Litigation](index=35&type=section&id=Litigation) The Company is involved in a significant civil litigation related to a finance lease agreement with Fujian Sanai Pharmaceutical, where the plaintiff seeks joint liability from the Company; after an appeal, the case was remanded for retrial, and the Beijing Fourth Intermediate People's Court issued a second civil judgment confirming Fujian Sanai Pharmaceutical's payment obligations and the Company's joint liability, for which the Company has filed a second appeal, currently ongoing - The Company is involved in a significant civil litigation related to a finance lease agreement with Fujian Sanai Pharmaceutical, being required to bear joint liability for the litigation amount[81](index=81&type=chunk)[84](index=84&type=chunk) - After an appeal, the case was remanded for retrial, and the second civil judgment confirmed Fujian Sanai Pharmaceutical's outstanding payments to the plaintiff and the Company's joint liability[83](index=83&type=chunk)[84](index=84&type=chunk) - The Company has filed a second appeal with the Beijing High People's Court regarding the second civil judgment, requesting a ruling that the finance lease agreement and guarantee are invalid[85](index=85&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=37&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During the period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - No purchase, sale, or redemption of the Company's listed securities occurred during the period[87](index=87&type=chunk) [Events After the Reporting Period](index=37&type=section&id=Events%20After%20the%20Reporting%20Period) No significant events have occurred from the end of the reporting period up to the date of this announcement - No significant events occurred after the end of the reporting period[88](index=88&type=chunk) [Changes in Directors' Information](index=37&type=section&id=Changes%20in%20Directors'%20Information) After the period, Mr Chan Shing Hing retired as an executive director, and Professor Zhang Rongqing resigned as an executive director - Mr Chan Shing Hing retired as an executive director on June 20, 2025[90](index=90&type=chunk) - Professor Zhang Rongqing resigned as an executive director on June 26, 2025[90](index=90&type=chunk) [Compliance with Corporate Governance Code](index=38&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company has complied with the Corporate Governance Code, with a deviation where the roles of Chairman and Chief Executive Officer are not segregated (no Chairman), but the Board believes sufficient checks and balances are in place - The Company has complied with the Corporate Governance Code, with a deviation where the roles of Chairman and Chief Executive Officer are not segregated (no Chairman)[91](index=91&type=chunk) - The Board believes that with three independent non-executive directors, sufficient checks and balances are in place[91](index=91&type=chunk) [Compliance with Model Code](index=38&type=section&id=Compliance%20with%20Model%20Code) All Directors have confirmed full compliance with the Model Code as set out in Appendix C3 of the Listing Rules during the period - All Directors have confirmed full compliance with the Model Code[92](index=92&type=chunk) [Capital Reduction and Share Subdivision](index=38&type=section&id=Capital%20Reduction%20and%20Share%20Subdivision) The Company has completed a capital reduction and share subdivision, reducing the par value per share from HK$0.25 to HK$0.01 and subdividing authorized but unissued shares, with these changes effective February 3, 2025 - The capital reduction and share subdivision became effective on February 3, 2025[94](index=94&type=chunk) - The par value per share was reduced from **HK$0.25 to HK$0.01**[93](index=93&type=chunk) [Audit Committee](index=39&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors, reviewed the Group's financial reporting procedures, risk management, and internal control systems, and discussed the interim financial statements, deeming them compliant with relevant accounting standards - The Audit Committee comprises three independent non-executive directors, with Mr Hui Ki Lun as Chairman[95](index=95&type=chunk) - The Committee reviewed the interim financial statements and considered them to be in compliance with relevant accounting standards, rules, and regulations[95](index=95&type=chunk) [Publication of Interim Report](index=39&type=section&id=Publication%20of%20Interim%20Report) The 2025 Interim Report will be dispatched to shareholders in due course and published on the Company's website and the Stock Exchange's website - The 2025 Interim Report will be dispatched to shareholders in due course and published on the Company's and the Stock Exchange's websites[96](index=96&type=chunk) [Acknowledgement](index=40&type=section&id=Acknowledgement) The Group sincerely thanks the management team, all employees, shareholders, and other stakeholders for their continuous efforts, dedication, strong support, and trust - The Group expresses gratitude to the management team, employees, shareholders, and stakeholders for their support[97](index=97&type=chunk) [Board of Directors](index=40&type=section&id=Board%20of%20Directors) As of the announcement date, the Board of Directors comprises three executive directors (Mr Yuan Chaoyang, Mr She Hao, Mr Xie Haijing) and three independent non-executive directors (Professor Zhu Yizhun, Mr Hui Ki Lun, Ms Xu Wanda) - The Board of Directors consists of three executive directors and three independent non-executive directors[99](index=99&type=chunk)

[Financial Summary](index=1&type=section&id=%E8%B2%B4%E5%8B%99%E6%91%98%E8%A6%81) The Group's financial performance for the six months ended June 30, 2025, shows a significant increase in loss attributable to owners and a decrease in revenue, alongside a reduction in cash and borrowings. Financial Summary for the Six Months Ended June 30, 2025 | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 106,338 | 148,322 | -28.3 | | Gross Profit | 41,974 | 58,134 | -27.8 | | Gross Profit Margin | 39.5% | 39.2% | 0.8 | | Loss Attributable to Owners of the Company | (29,151) | (14,972) | 94.7 | | Loss Per Share (HK cents) Basic and Diluted | (2.92) | (1.50) | 94.7 | Financial Position Summary as of June 30, 2025 | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents and Pledged Deposits | 132,862 | 191,459 | -30.6 | | Bank and Other Borrowings | 160,250 | 195,972 | -18.2 | | Gearing Ratio | 44.2% | 52.0% | -15.0 | | Net Asset Value Per Share (HKD) | 0.37 | 0.38 | -2.6 | [Interim Results](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) This section provides an overview of the Group's performance during the interim period, highlighting key financial outcomes. [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) The condensed consolidated statement of profit or loss details the Group's financial performance, showing a significant increase in loss for the period. Condensed Consolidated Statement of Profit or Loss (For the Six Months Ended June 30) | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Revenue | 106,338 | 148,322 | | Cost of Sales | (64,364) | (90,188) | | Gross Profit | 41,974 | 58,134 | | Other Income and Gains, Net | 2,599 | 6,596 | | Selling and Distribution Expenses | (20,151) | (28,990) | | Administrative Expenses | (34,132) | (37,684) | | Net Reversal of Impairment Provisions for Trade and Bills Receivables / (Provisions) | 928 | (956) | | Other Expenses, Net | (14,248) | (4,649) | | Finance Costs | (3,992) | (5,885) | | Loss Before Tax | (27,022) | (13,434) | | Income Tax Expense | (2,166) | (1,201) | | Loss for the Period | (29,188) | (14,635) | | Loss Attributable to Owners of the Parent | (29,151) | (14,972) | | Loss / (Profit) Attributable to Non-controlling Interests | (37) | 337 | | Basic and Diluted Loss Per Share (HK cents) | (2.92) | (1.50) | [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) This statement presents the Group's total comprehensive loss for the period, including exchange differences on translation of foreign operations. Condensed Consolidated Statement of Comprehensive Income (For the Six Months Ended June 30) | Metric | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Loss for the Period | (29,188) | (14,635) | | Exchange Differences on Translation of Foreign Operations | 14,970 | (13,166) | | Other Comprehensive Income / (Loss) for the Period | 14,970 | (13,166) | | Total Comprehensive Loss for the Period | (14,218) | (27,801) | | Total Comprehensive Loss Attributable to Owners of the Parent | (14,304) | (28,037) | | Total Comprehensive Income / (Loss) Attributable to Non-controlling Interests | 86 | 236 | [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%B4%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) The condensed consolidated statement of financial position provides a snapshot of the Group's assets, liabilities, and equity as of June 30, 2025. Condensed Consolidated Statement of Financial Position (As at June 30, 2025) | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, Plant and Equipment | 87,905 | 90,786 | | Investment Properties | 296,124 | 295,283 | | Total Non-current Assets | 433,806 | 438,683 | | **Current Assets** | | | | Inventories | 20,342 | 18,664 | | Trade and Bills Receivables | 76,052 | 103,628 | | Cash and Cash Equivalents | 115,353 | 169,252 | | Total Current Assets | 283,163 | 365,313 | | **Current Liabilities** | | | | Trade and Bills Payables | 96,124 | 125,437 | | Interest-bearing Bank Borrowings | 77,852 | 88,075 | | Total Current Liabilities | 223,793 | 270,259 | | Net Current Assets | 59,370 | 95,054 | | **Non-current Liabilities** | | | | Loans from Parent Group | 33,927 | 107,897 | | Interest-bearing Bank Borrowings | 48,471 | – | | Total Non-current Liabilities | 126,310 | 152,674 | | Net Assets | 366,866 | 381,063 | | **Total Equity** | 366,866 | 381,063 | [Notes to the Condensed Consolidated Financial Statements](index=6&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%B4%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed explanatory notes to the condensed consolidated financial statements, offering further insights into the Group's accounting policies and financial performance. [1.1 Basis of Preparation](index=6&type=section&id=1.1%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) These condensed consolidated interim financial statements are prepared in accordance with HKAS 34 and the Listing Rules, and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024. - These interim financial statements are prepared in accordance with HKAS 34 and the Listing Rules, supplementing the annual consolidated financial statements[10](index=10&type=chunk) [1.2 Changes in Accounting Policies and Disclosures](index=6&type=section&id=1.2%20%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96%E5%8F%8A%E6%8A%AB%E9%9C%B2%E8%AE%8A%E6%9B%B4) Accounting policies for the period are consistent with the prior year, except for the adoption of HKAS 21 amendments regarding lack of exchangeability, which had no material impact as the Group's transaction and functional currencies are convertible. - The Group adopted HKAS 21 amendments on lack of exchangeability, but it had no impact on the financial statements as all group currencies are convertible[11](index=11&type=chunk)[12](index=12&type=chunk) [2. Operating Segment Information](index=7&type=section&id=2.%20%E7%B6%93%E7%87%9F%E5%88%86%E9%A1%9E%E8%B3%87%E6%96%99) The Group operates in two segments: paint products and property investment, with paint products showing increased losses and property investment shifting from profit to loss, reflecting overall declines in revenue and assets due to market challenges. - The Group primarily operates in two segments: paint products and property investment, with management regularly reviewing their performance for resource allocation and evaluation[13](index=13&type=chunk)[17](index=17&type=chunk) Operating Segment Results (For the Six Months Ended June 30) | Segment | 2025 Segment Revenue (HKD thousands) | 2024 Segment Revenue (HKD thousands) | 2025 Segment Results (HKD thousands) | 2024 Segment Results (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Paint Products | 98,741 | 139,217 | (21,578) | (19,296) | | Property Investment | 9,475 | 14,473 | (186) | 12,871 | | Total | 108,216 | 153,690 | (21,764) | (6,425) | Operating Segment Assets and Liabilities (As at June 30) | Segment | 2025 Segment Assets (HKD thousands) | 2024 Segment Assets (HKD thousands) | 2025 Segment Liabilities (HKD thousands) | 2024 Segment Liabilities (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Paint Products | 408,654 | 482,223 | 308,967 | 381,312 | | Property Investment | 305,284 | 308,391 | 39,691 | 39,477 | | Total | 713,938 | 790,614 | 348,658 | 420,789 | [Geographical Information](index=11&type=section&id=%E5%9C%B0%E5%9F%9F%E8%B3%87%E6%96%99) The Group's revenue is primarily from Mainland China, accounting for 89.4% of total revenue, with Hong Kong contributing 10.6%, and non-current assets also predominantly located in Mainland China. Revenue from External Customers (For the Six Months Ended June 30) | Region | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Hong Kong | 10,314 | 27,727 | | Mainland China | 96,024 | 120,595 | | Total | 106,338 | 148,322 | Non-current Assets (As at June 30) | Region | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Hong Kong | 1,186 | 855 | | Mainland China | 416,783 | 419,537 | | Total | 417,969 | 420,392 | - For the six months ended June 30, 2025 and 2024, no single customer accounted for 10% or more of the Group's total revenue[23](index=23&type=chunk) [3. Revenue, Other Income and Gains, Net](index=12&type=section&id=3.%20%E6%94%B6%E5%85%A5%E3%80%81%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E5%8F%8A%E6%94%B6%E7%9B%8A%E6%B7%A8%E9%A1%8D) The Group's total revenue decreased by 28.3% year-on-year, primarily due to reduced paint product sales and investment property rental income, with other income and gains also declining from lower government grants and property disposal gains. Revenue Analysis (For the Six Months Ended June 30) | Revenue Source | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Sales of Paint Products | 96,893 | 137,044 | | Gross Rental Income from Investment Properties | 9,445 | 11,278 | | Total | 106,338 | 148,322 | Types of Paint and Coating Products Sold (For the Six Months Ended June 30) | Product Type | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Industrial Paint and Coating Products | 56,485 | 64,904 | | Architectural Paint and Coating Products | 17,190 | 35,217 | | General Paint and Coating and Ancillary Products | 23,218 | 36,923 | | Total | 96,893 | 137,044 | Other Income and Gains, Net Analysis (For the Six Months Ended June 30) | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Bank Interest Income | 721 | 1,228 | | Net Fair Value Gain on Investment Properties | – | 3,195 | | Government Grants | 40 | 204 | | Government Subsidies | 342 | 408 | | Total | 2,599 | 6,596 | [4. Finance Costs](index=13&type=section&id=4.%20%E8%9E%8D%E8%B3%87%E8%B2%BB%E7%94%A8) Finance costs for the period decreased by 32.2% year-on-year, primarily due to lower interest expenses on bank and other borrowings and lease liabilities. Finance Costs Analysis (For the Six Months Ended June 30) | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 3,849 | 5,719 | | Interest Expense on Lease Liabilities | 143 | 166 | | Total | 3,992 | 5,885 | [5. Loss Before Tax](index=14&type=section&id=5.%20%E9%99%A4%E7%A8%85%E5%89%8D%E虧%E6%90%8D) The Group's loss before tax significantly increased year-on-year, primarily due to a shift from fair value gain to loss on investment properties, exchange differences turning from gain to loss, and higher employee termination costs. Components of Loss Before Tax (For the Six Months Ended June 30) | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Cost of Inventories Sold | 64,364 | 90,188 | | Depreciation of Property, Plant and Equipment | 5,876 | 7,533 | | Depreciation of Right-of-use Assets | 2,314 | 2,294 | | Net Exchange Differences | 1,213 | (68) | | Net Fair Value Loss / (Gain) on Investment Properties | 8,363 | (3,195) | | Net Impairment Provisions for Trade and Bills Receivables / (Reversal of Provisions) | (928) | 956 | | Net Provisions for Inventories / (Reversal) to Net Realizable Value | (269) | 291 | | Employee Termination Costs | 1,128 | 600 | [6. Income Tax](index=14&type=section&id=6.%20%E6%89%80%E5%BE%97%E7%A8%85) The Group has no Hong Kong profits tax provision due to no taxable profits, while Mainland China subsidiaries pay corporate income tax at a standard 25% rate, with high-tech qualified subsidiaries enjoying a preferential 15% rate. - No Hong Kong profits tax provision is made, while Mainland China subsidiaries are subject to a **25%** corporate income tax rate, with high-tech enterprises enjoying a preferential **15%** rate[29](index=29&type=chunk) [7. Loss Per Share Attributable to Owners of the Parent](index=15&type=section&id=7.%20%E6%AF%8D%E5%85%AC%E5%8F%B8%E6%99%AE%E9%80%9A%E8%82%A1%E6%AC%8A%E7%9B%8A%E6%8C%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%B5%E6%AF%8F%E8%82%A1%E虧%E6%90%8D) For the six months ended June 30, 2025, basic and diluted loss per share was 2.92 HK cents, a significant 94.7% increase from 1.50 HK cents in the prior year, with no dilution adjustment due to the anti-dilutive effect of share options. Loss Per Share (For the Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Loss for the Period Attributable to Owners of the Parent (HKD) | 29,151,000 | 14,972,000 | | Weighted Average Number of Ordinary Shares in Issue (Shares) | 1,000,000,000 | 1,000,000,000 | | Basic and Diluted Loss Per Share (HK cents) | (2.92) | (1.50) | - No diluted loss per share adjustment was made as the outstanding share options had an anti-dilutive effect on basic loss per share[30](index=30&type=chunk) [8. Dividends](index=15&type=section&id=8.%20%E8%82%A1%E6%81%AF) The Board resolved not to declare an interim dividend for the six months ended June 30, 2025, consistent with the prior year. - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025[31](index=31&type=chunk) [9. Property, Plant and Equipment](index=15&type=section&id=9.%20%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99) The cost of additions to property, plant and equipment significantly increased to HKD 284,000 for the period, while the net book value of disposals remained low. Changes in Property, Plant and Equipment (For the Six Months Ended June 30) | Item | 2025 (HKD) | 2024 (HKD) | | :--- | :--- | :--- | | Cost of Additions | 284,000 | 42,000 | | Net Book Value of Disposals | 1 | 2 | [10. Investment Properties](index=15&type=section&id=10.%20%E6%8A%95%E8%B3%87%E7%89%A9%E6%A5%AD) The Group's investment property carrying value slightly increased, primarily due to positive exchange adjustments offsetting fair value losses, following revaluation by independent valuers. Changes in Carrying Value of Investment Properties (As at June 30) | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Carrying Value at Beginning of Period / Year | 295,283 | 309,087 | | Fair Value Loss | (8,363) | (7,978) | | Exchange Adjustment | 9,204 | (9,785) | | Carrying Value at End of Period / Year | 296,124 | 295,283 | - Independent professional valuers revalued investment properties to **HKD 296,124,000** as of June 30, 2025, with fair value generally derived using the income capitalization approach[33](index=33&type=chunk) [11. Trade and Bills Receivables](index=16&type=section&id=11.%20%E6%87%89%E6%94%B6%E8%B2%B7%E6%98%93%E8%B3%A6%E6%AC%BE%E5%8F%8A%E7%A5%A8%E6%93%9A) Total trade and bills receivables decreased by 26.6% year-on-year, with a notable reduction in receivables aged within three months, as the Group closely monitors credit risk and has no significant concentration of credit risk. - The Group's trade receivables primarily arise from leasing investment properties and selling paint products, with credit terms generally one month, extendable to three months for major customers[34](index=34&type=chunk) Ageing Analysis of Trade and Bills Receivables (As at June 30) | Ageing | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 37,069 | 55,670 | | Over 3 months but within 6 months | 8,431 | 7,511 | | Over 6 months | 30,552 | 40,447 | | Total | 76,052 | 103,628 | [12. Trade and Bills Payables](index=17&type=section&id=12.%20%E6%87%89%E4%BB%98%E8%B2%B7%E6%98%93%E8%B3%A6%E6%AC%BE%E5%8F%8A%E7%A5%A8%E6%93%9A) Total trade and bills payables decreased by 23.3% year-on-year, primarily settled within three months, with some bills payable secured by pledged time deposits. Ageing Analysis of Trade and Bills Payables (As at June 30) | Ageing | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 34,946 | 49,975 | | Over 3 months but within 6 months | 20,141 | 34,389 | | Over 6 months | 41,037 | 41,073 | | Total | 96,124 | 125,437 | - Trade and bills payables are unsecured, non-interest-bearing, and generally settled within two months, with bills payable of **HKD 57,661,000** secured by pledged time deposits of **HKD 17,509,000**[36](index=36&type=chunk) [13. Share Option Scheme](index=17&type=section&id=13.%20%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The Group granted 80,000,000 share options on June 15, 2022, with an exercise price of HKD 0.335 per share; as of June 30, 2025, 10,000,000 options lapsed due to director resignations, leaving 60,000,000 outstanding. - On June 15, 2022, **80,000,000** share options were granted with an exercise price of **HKD 0.335** per share, a four-year vesting period, and a five-year exercise period[37](index=37&type=chunk) Outstanding Share Options (As at June 30) | Item | Number of Share Options 2025 | Number of Share Options 2024 | | :--- | :--- | :--- | | At January 1 | 70,000,000 | 80,000,000 | | Lapsed during the period | (10,000,000) | (10,000,000) | | At June 30 | 60,000,000 | 70,000,000 | | Vested and exercisable at June 30 | 54,000,000 | 56,000,000 | - Net share option expense recognized for the six months ended June 30, 2025, was approximately **HKD 21,000**, a significant decrease from **HKD 209,000** in the prior year[39](index=39&type=chunk) [14. Comparative Figures](index=18&type=section&id=14.%20%E6%AF%94%E8%BC%83%E6%95%B8%E5%AD%97) Certain comparative figures have been reclassified to conform with the current period's presentation. - Certain comparative figures have been reclassified to conform with the current period's presentation[40](index=40&type=chunk) [Management Discussion and Analysis](index=19&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) This section provides a comprehensive review of the Group's operational and financial performance, market conditions, and future outlook. [Interim Dividend](index=19&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. - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025[41](index=41&type=chunk) [Business Review](index=19&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's loss attributable to shareholders for H1 2025 significantly increased by 94.7% to approximately HKD 29.15 million, primarily due to a shift from fair value gain to loss on investment properties and a 29.3% decline in paint and coating product sales, despite effective cash outflow control and loan portfolio restructuring through operational cost savings. - The Group recorded a loss attributable to owners of the Company of approximately **HKD 29.15 million** for H1 2025, a **94.7% increase** from the **HKD 14.97 million** loss in H1 2024[43](index=43&type=chunk) - The increased loss was primarily due to an **HKD 8.36 million fair value loss** on investment properties (compared to an **HKD 3.20 million gain** in H1 2024) and a **29.3% decrease** in paint and coating product sales[43](index=43&type=chunk) - Through strategic operational optimization, net operating cash outflow significantly decreased by **29.1%** compared to H1 2024, with bank and other borrowings reduced from **HKD 195.97 million** to **HKD 160.25 million**[44](index=44&type=chunk) [Paint and Coating Business](index=21&type=section&id=%E6%B2%B9%E6%BC%86%E5%8F%8A%E5%A1%97%E6%96%99%E6%A5%AD%E5%8B%99) The paint and coating business faced challenges from a sluggish Mainland China property market, slower construction, and increased competition, resulting in a 29.3% year-on-year sales revenue decrease, with architectural paint and coating products experiencing the largest decline; however, gross profit margin remained resilient due to lower raw material and labor costs. - The continuous downturn in Mainland China's property market and significant slowdown in construction activities pressured demand for paint and coating products, particularly architectural paint and coating products[45](index=45&type=chunk) - Weak demand in the Hong Kong market, coupled with oversupply from new competitors, led major contractors to directly source paint and coating products from Mainland China[45](index=45&type=chunk) - For the six months ended June 30, 2025, the Group's paint and coating product sales revenue decreased by **29.3%** compared to the prior year[45](index=45&type=chunk) [Operational Review](index=22&type=section&id=%E7%87%9F%E9%81%8B%E5%9B%9E%E9%A1%A7) The Group's total revenue was HKD 106.34 million, a significant 28.3% decrease from the prior year, primarily due to reduced sales revenue and investment property rental income. Total Revenue Composition (For the Six Months Ended June 30) | Revenue Source | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Sales Revenue | 96,890 | 137,040 | | Rental Income from Investment Properties | 9,450 | 11,280 | | Total Revenue | 106,340 | 148,320 | [Paint and Coating Products](index=22&type=section&id=%E6%B2%B9%E6%BC%86%E5%8F%8A%E5%A1%97%E6%96%99%E7%94%A2%E5%93%81) The paint and coating products segment experienced increased losses, with revenue significantly decreasing to HKD 96.89 million, and all product categories showing substantial sales declines, particularly architectural paint and coating products. - The paint and coating products segment recorded a loss of **HKD 21.58 million**, an increase from the **HKD 19.30 million** loss in H1 2024[48](index=48&type=chunk) Paint and Coating Products Revenue Analysis (For the Six Months Ended June 30) | Product Type | 2025 (HKD thousands) | 2025 (%) | 2024 (HKD thousands) | 2024 (%) | Net Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Industrial Paint and Coating Products | 56,485 | 58.3 | 64,904 | 47.4 | -13.0 | | Architectural Paint and Coating Products | 17,190 | 17.7 | 35,217 | 25.7 | -51.2 | | General Paint and Coating and Ancillary Products | 23,218 | 24.0 | 36,923 | 26.9 | -37.1 | | Total | 96,893 | 100.0 | 137,044 | 100.0 | -29.3 | [Significant Decrease in Sales to Hong Kong Wholesale and Retail Distributors](index=23&type=section&id=%E5%B0%8D%E9%A6%99%E6%B8%AF%E6%89%B9%E7%99%BC%E5%8F%8A%E9%9B%B6%E5%94%AE%E5%88%86%E9%8A%B7%E5%95%86%E4%B9%8B%E9%8A%B7%E5%94%AE%E9%A1%AF%E8%91%97%E6%B8%9B%E5%B0%91) Sales to Hong Kong wholesale and retail distributors significantly decreased by 67.7%, primarily due to the negative impact of the construction and building industry on Hong Kong's GDP and contractors shifting to direct procurement from Mainland China. - Sales to Hong Kong wholesale and retail distributors significantly decreased by **67.7%** compared to the prior year[49](index=49&type=chunk) - The sales decline is primarily attributed to the negative impact of Hong Kong's construction and building industry on local GDP, and major contractors shifting to direct procurement of paint and coating products from Mainland China[49](index=49&type=chunk) [Significant Decrease in Sales to Mainland China Wholesale and Retail Distributors](index=23&type=section&id=%E5%B0%8D%E4%B8%AD%E5%9C%8B%E5%85%A7%E5%9C%B0%E4%B9%8B%E6%89%B9%E7%99%BC%E5%8F%8A%E9%9B%B6%E5%94%AE%E5%88%86%E9%8A%B7%E5%95%86%E4%B9%8B%E9%8A%B7%E5%94%AE%E9%A1%AF%E8%91%97%E6%B8%9B%E5%B0%91) Sales to Mainland China wholesale and retail distributors decreased by 13.8%, primarily impacted by a sluggish property market, industry saturation, and price wars driven by intensified competition. - Sales to Mainland China wholesale and retail distributors significantly decreased by **13.8%** compared to the prior year[50](index=50&type=chunk) - The decline is mainly due to the sluggish Mainland China property market and saturation and competitive pressures within the paint and coating industry[50](index=50&type=chunk) [Significant Decrease in Sales to Mainland China Private Residential Property Project Developers and their Contractors](index=23&type=section&id=%E5%B0%8D%E4%B8%AD%E5%9C%8B%E5%85%A7%E5%9C%B0%E7%A7%81%E4%BA%BA%E4%BD%8F%E5%AE%85%E7%89%A9%E6%A5%AD%E9%A0%85%E7%9B%AE%E6%88%BF%E5%9C%B0%E7%94%A2%E9%96%8B%E7%99%BC%E5%95%86%E5%8F%8A%E7%82%BA%E5%85%B6%E5%B7%A5%E4%BD%9C%E4%B9%8B%E6%89%BF%E5%8C%85%E5%95%86%E4%B9%8B%E9%8A%B7%E5%94%AE%E9%A1%AF%E8%91%97%E6%B8%9B%E5%B0%91) Sales to Mainland China private residential property project developers and contractors significantly decreased by 97.5%, primarily due to the ongoing sluggish property market, stalled new projects, and pending tender results. - Sales to Mainland China private residential property project developers and their contractors significantly decreased by **97.5%** compared to the prior year[51](index=51&type=chunk) - The decline is attributed to the continuous downturn in Mainland China's property market, stalled progress on new real estate projects, and pending tender results[51](index=51&type=chunk) [Significant Decrease in Sales to Mainland China Industrial Manufacturers](index=23&type=section&id=%E5%B0%8D%E4%B8%AD%E5%9C%8B%E5%85%A7%E5%9C%B0%E5%B7%A5%E6%A5%AD%E8%A3%BD%E9%80%A0%E5%95%86%E4%B9%8B%E9%8A%B7%E5%94%AE%E9%A1%AF%E8%91%97%E6%B8%9B%E5%B0%91) Sales to Mainland China industrial manufacturers decreased by 13.0%, primarily due to intensified competition in the paint and coating industry and architectural paint manufacturers shifting to industrial paint production. - Sales to Mainland China industrial manufacturers significantly decreased by **13.0%** compared to the prior year[52](index=52&type=chunk) - The decrease is mainly due to intensified competition in the paint and coating industry and architectural paint manufacturers shifting to industrial paint production, exacerbating market competitive pressure[52](index=52&type=chunk) [Geographical Distribution of Revenue](index=24&type=section&id=%E6%94%B6%E5%85%A5%E4%B9%8B%E5%9C%B0%E5%9F%9F%E5%88%86%E4%BD%88) The Group's revenue primarily originated from Mainland China, increasing its share from 79.8% to 89.4%, while Hong Kong's share decreased from 20.2% to 10.6%, with South, Central, and East China remaining key revenue sources. - The Group's revenue from Mainland China and Hong Kong sales accounted for **89.4%** and **10.6%** respectively (compared to **79.8%** and **20.2%** in the prior year)[53](index=53&type=chunk) - Revenue generated from South, Central, and East China regions collectively accounted for **82.0%** of the Group's sales (compared to **74.0%** in the prior year)[53](index=53&type=chunk) [Cost of Sales](index=24&type=section&id=%E9%8A%B7%E5%94%AE%E6%88%90%E6%9C%AC) Cost of sales decreased due to lower raw material costs, direct and indirect labor costs, and depreciation and manufacturing overheads; falling crude oil prices positively impacted raw material costs, and the Group improved operational efficiency through cost-saving strategies. - A **19.2% decrease** in crude oil prices (USD 59-68 per barrel) positively impacted raw material costs, enabling the Group to offer more competitive pricing[54](index=54&type=chunk) - Direct and indirect labor costs significantly decreased by **15.7%** year-on-year, primarily due to lower sales and improved operational efficiency from production facility consolidation[55](index=55&type=chunk) - Depreciation and manufacturing overheads decreased by **18.7%** year-on-year, with depreciation down **26.5%** and manufacturing overheads down **8.2%**[56](index=56&type=chunk) [The Group's Gross Profit and Gross Profit Margin](index=25&type=section&id=%E6%9C%AC%E9%9B%86%E5%9C%98%E4%B9%8B%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) The Group's gross profit decreased by 30.6%, primarily due to lower sales; despite intense market competition and reduced demand, the gross profit margin remained resilient, declining by only 0.6 percentage points. - The Group's gross profit decreased by **30.6%**, primarily due to a **29.3% reduction** in sales compared to the prior year[57](index=57&type=chunk) - Despite challenges, the gross profit margin demonstrated resilience, decreasing by only **0.6 percentage points** compared to the prior year[57](index=57&type=chunk) [Other Income and Gains, Net](index=25&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E5%8F%8A%E6%94%B6%E7%9B%8A%E6%B7%A8%E9%A1%8D) Other income and gains, net, decreased by 14.7% year-on-year, primarily due to reduced government grants and gains from the disposal of property, plant and equipment. - Other income and gains, net, amounted to **HKD 1.85 million**, a **14.7% decrease** from **HKD 2.17 million** in the prior year[58](index=58&type=chunk) - The decrease was mainly due to a **HKD 160,000 reduction** in government grants and a **HKD 160,000 decrease** in gains from the disposal of property, plant and equipment[58](index=58&type=chunk) [Selling and Distribution Expenses and Administrative Expenses](index=25&type=section&id=%E9%8A%B7%E5%94%AE%E5%8F%8A%E5%88%86%E9%8A%B7%E9%96%8B%E6%94%AF%E4%BB%A5%E5%8F%8A%E8%A1%8C%E6%94%BF%E9%96%8B%E6%94%AF) Selling and distribution expenses significantly decreased by 30.5%, primarily due to reduced legal and professional fees and cost savings, while administrative expenses also decreased by 8.5% from savings in staff costs and other operating expenses. - Selling and distribution expenses decreased by **30.5%** from **HKD 28.99 million** to **HKD 20.15 million**, mainly due to a **HKD 5.55 million reduction** in legal and professional fees and **HKD 3.29 million** in cost savings[59](index=59&type=chunk) - Administrative expenses decreased by **8.5%** to **HKD 31.88 million**, primarily due to a **HKD 1.86 million reduction** in staff costs and **HKD 1.09 million** in other operating expenses[59](index=59&type=chunk) [Other Operating Expenses](index=26&type=section&id=%E5%85%B6%E4%BB%96%E7%B6%93%E7%87%9F%E9%96%8B%E6%94%AF) Other operating expenses decreased by 13.0% year-on-year, primarily due to a net reversal of impairment provisions for trade and bills receivables, despite an increase in employee termination costs. - Other operating expenses decreased by **13.0%** compared to the prior year[60](index=60&type=chunk) - This was mainly due to a **HKD 930,000 reversal** of net impairment provisions for trade and bills receivables (compared to a **HKD 960,000 provision** in the prior year), resulting in a **HKD 1.89 million improvement** in impairment adjustments[60](index=60&type=chunk) - Employee termination costs increased by **HKD 530,000** compared to the prior year[60](index=60&type=chunk) [Property Investment](index=26&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) The Group strategically reallocated investment properties, converting underutilized plants, and despite declining rental income and fair value losses from a sluggish Mainland China property market, RMB appreciation positively impacted asset valuation, leading to a slight increase in total investment property valuation, with investment properties now comprising 41.3% of total assets. - The Group strategically reallocated investment properties, effectively converting underutilized production plants and office premises to optimize asset allocation[61](index=61&type=chunk) - A **3.1% appreciation** of the Renminbi positively impacted asset valuation, offsetting fair value losses and increasing investment property valuation from **HKD 295.28 million** to **HKD 296.12 million**[61](index=61&type=chunk) - Rental income from investment properties was **HKD 9.45 million**, a decrease from **HKD 11.28 million** in the prior year, resulting in a segment loss of **HKD 190,000** (compared to a profit of **HKD 12.87 million** in the prior year)[62](index=62&type=chunk) - Investment property fair value adjustments amounted to **HKD 11.56 million**, leading to a fair value loss of **HKD 8.36 million** (compared to a gain of **HKD 3.20 million** in the prior year)[62](index=62&type=chunk) [Financial Review](index=27&type=section&id=%E8%B2%B4%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's total cash and cash equivalents decreased due to bank loan repayments, but total bank and other borrowings also significantly declined, improving both the gearing ratio and current ratio; inventory and trade and bills receivables turnover days increased, reflecting lower sales and the impact of some receivable litigations, while RMB appreciation generated positive exchange gains on equity. - Total cash and cash equivalents were approximately **HKD 115.35 million**, a decrease from December 31, 2024, primarily due to net repayment of bank and other borrowings of **HKD 39.20 million**[65](index=65&type=chunk) - Bank and other borrowings were approximately **HKD 160.25 million**, an **18.2% decrease** from **HKD 195.97 million** as of December 31, 2024[65](index=65&type=chunk) Liquidity and Gearing Ratios (As at June 30) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gearing Ratio | 44.2% | 52.0% | | Current Ratio | 1.27 times | 1.35 times | | Inventory Turnover Days | 57 days | 36 days | | Trade and Bills Receivables Turnover Days | 142 days | 127 days | - Due to RMB appreciation, exchange differences on translation of foreign operations recognized in other comprehensive income resulted in a **HKD 14.97 million gain** (compared to a **HKD 13.17 million loss** in the prior year)[68](index=68&type=chunk) [Liquidity and Gearing](index=27&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E5%82%B5%E5%8B%99) The Group's cash and cash equivalents decreased, but bank and other borrowings also significantly declined, improving both the gearing ratio and current ratio; inventory and trade receivables turnover days increased, reflecting lower sales and the impact of some receivable litigations. - The Group's cash and bank balances are primarily denominated in HKD and RMB, with all bank borrowings denominated in HKD and RMB[66](index=66&type=chunk) - Inventory turnover days increased by **58.3%** from **36 days** to **57 days**, and trade and bills receivables turnover days increased by **11.8%** from **127 days** to **142 days**[67](index=67&type=chunk) [Equity and Net Assets](index=28&type=section&id=%E6%AC%8A%E7%9B%8A%E5%8F%8A%E8%B3%87%E7%94%A2%E6%B7%A8%E5%80%BC) Shareholders' funds and net asset value per share slightly decreased, while RMB appreciation generated positive exchange gains on translation of foreign operations, positively impacting equity. Equity and Net Assets (As at June 30) | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Shareholders' Funds | 362,810 | 377,090 | | Net Asset Value Per Share (HKD) | 0.37 | 0.38 | [Contingent Liabilities](index=28&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) The utilized amount of bank financing guarantees provided by the Company for its subsidiaries significantly increased to HKD 58 million, while performance bonds, secured by pledged deposits, were zero for the period. - As of June 30, 2025, the utilized amount of bank financing guaranteed by the Company for its subsidiaries was **HKD 58 million** (compared to **HKD 21 million** as of December 31, 2024)[69](index=69&type=chunk) - Performance bonds, secured by pledged deposits, were **zero** as of June 30, 2025 (compared to **HKD 640,000** as of December 31, 2024)[69](index=69&type=chunk) [Pledge of Assets](index=29&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) Certain investment properties, property, plant and equipment, right-of-use assets, and cash deposits with a total net book value of HKD 306.24 million were pledged to financial institutions as collateral for bills payable, bank borrowings, performance bonds, and lease liabilities. - As of June 30, 2025, certain assets with a total net book value of **HKD 306.24 million** were pledged to financial institutions as collateral for bills payable, bank borrowings, performance bonds, and lease liabilities[71](index=71&type=chunk) - Changes in pledged assets were due to transitional performance from strategic financial restructuring and optimization, as well as the appreciation of the Renminbi[71](index=71&type=chunk) [Employees](index=29&type=section&id=%E5%83%B1%E5%93%A1) The Group's total headcount decreased by 11.1% to 426 employees, with staff costs decreasing by 12.8% year-on-year, reflecting the Group's cost control efforts. Employee Headcount and Costs (For the Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total Number of Employees (Persons) | 426 | 479 | | Staff Costs (HKD thousands) | 34,960 | 40,110 | - The Group provides comprehensive and competitive employee remuneration and benefits based on individual performance, along with training opportunities[72](index=72&type=chunk) [Business Plan and Outlook](index=29&type=section&id=%E6%A5%AD%E5%8B%99%E8%A8%88%E5%8A%83%E5%8F%8A%E5%B1%95%E6%9C%9B) For H2 2025, the Group will continue its "Business Revitalization Measures and Actions" to address market volatility and insufficient domestic demand, focusing on enriching product portfolios, expanding distribution networks, enhancing operational efficiency, reducing costs, and prioritizing high-interest loan repayment to lower financial costs. - The Group will implement "Business Revitalization Measures and Actions" to address market volatility, anticipating policy guidance to promote sustainable industry growth[73](index=73&type=chunk) - A core strategy is prioritizing repayment of high-interest borrowings to reduce financial costs and enhance liquidity, with bank and other borrowings already significantly reduced by **18.2%**[74](index=74&type=chunk) - The objectives are threefold: (a) enriching the product portfolio and ensuring competitiveness; (b) expanding and strengthening distribution networks in Mainland China, Hong Kong, and other regions; and (c) enhancing operational efficiency and reducing costs[75](index=75&type=chunk) [Significant Investments Held, Material Acquisitions and Disposals of Subsidiaries, and Future Plans for Material Investments or Capital Assets](index=30&type=section&id=%E6%8C%81%E6%9C%89%E4%B9%8B%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E3%80%81%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E3%80%81%E4%BB%A5%E5%8F%8A%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E4%B9%8B%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) During the review period, the Group made no significant investments, acquisitions, or disposals of subsidiaries, and the Board has not approved any other plans for material investments or additions to capital assets. - During the review period, there were no acquisitions of other significant investments, nor any other material acquisitions or disposals of subsidiaries[76](index=76&type=chunk) - The Board has not approved any other plans for material investments or additions to capital assets[76](index=76&type=chunk) [Purchase, Sale or Redemption of the Company's Shares](index=30&type=section&id=%E8%B2%B7%E8%B3%A3%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%82%A1%E4%BB%BD) During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares. - During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares[77](index=77&type=chunk) [Corporate Governance](index=31&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) This section outlines the Company's adherence to corporate governance principles and practices during the reporting period. [Corporate Governance](index=31&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Company applied and complied with the Corporate Governance Code in Appendix C1 of the Listing Rules during the period, except for the combined roles of Chairman and Chief Executive Officer, which the Board deems appropriate for policy continuity and business stability at this stage, subject to regular review. - The Company complied with the Corporate Governance Code during the period, except for Mr. Xu Haoquan holding both the Chairman and Chief Executive Officer positions[78](index=78&type=chunk) - The Board believes that Mr. Xu Haoquan holding both roles is appropriate at this stage to maintain policy continuity and business stability, and this arrangement will be regularly reviewed[78](index=78&type=chunk)[79](index=79&type=chunk) [Code for Securities Transactions by Directors](index=32&type=section&id=%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E4%B9%8B%E5%AE%88%E5%89%87) The Company adopted a code for directors' securities transactions no less exacting than the Listing Rules' Model Code, and all directors confirmed compliance throughout the period. - The Company adopted a code for directors' securities transactions no less exacting than the Model Code set out in Appendix C3 of the Listing Rules[80](index=80&type=chunk) - All directors confirmed compliance with the standards of the Model Code and the Company's own code for the six months ended June 30, 2025[80](index=80&type=chunk)

[Company Information and Disclaimer](index=1&type=section&id=Company%20Information%20and%20Disclaimer) This section provides an overview of Cool Link (Holdings) Limited's unaudited condensed consolidated interim results for the six months ended June 30, 2025, including board responsibilities and GEM market risk warnings [Company Overview and Report Statement](index=1&type=section&id=Company%20Overview%20and%20Report%20Statement) This announcement presents Cool Link (Holdings) Limited's unaudited condensed consolidated interim results for the six months ended June 30, 2025, confirming accuracy and completeness while highlighting GEM market investment risks - Cool Link (Holdings) Limited (Stock Code: 8491) announced its unaudited condensed consolidated interim results for the six months ended June 30, 2025[2](index=2&type=chunk) - The Board confirms that the information contained in this announcement is **accurate and complete in all material respects**, and not misleading or fraudulent[3](index=3&type=chunk) - The GEM market is positioned to provide a listing platform for small and medium-sized companies with **higher investment risks**, and investors should understand the potential risks[5](index=5&type=chunk) [Unaudited Condensed Consolidated Financial Statements](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including the statement of comprehensive income, statement of financial position, statement of changes in equity, and statement of cash flows [Unaudited Condensed Consolidated Statement of Comprehensive Income](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group achieved a profit of S$105 thousand, a significant improvement from the prior year's loss, driven by effective cost control despite a slight revenue decrease Condensed Consolidated Statement of Comprehensive Income Key Data | Indicator | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Revenue | 14,230 | 14,678 | | Cost of sales | (10,357) | (10,813) | | Gross profit | 3,873 | 3,865 | | Other income and other gains | 153 | 141 | | Selling and distribution costs | (1,104) | (1,472) | | Administrative and other operating expenses | (2,442) | (2,584) | | Share of results of an associate | – | (22) | | Finance costs | (240) | (200) | | Profit/(Loss) before income tax | 240 | (272) | | Income tax expense | (135) | (102) | | Profit/(Loss) for the period attributable to owners of the Company | 105 | (374) | | Basic and diluted earnings/(loss) per share (Singapore cents) | 0.03 | (0.16) | - Profit for the period attributable to owners of the Company turned from a **loss of S$374 thousand** in the same period of 2024 to a **profit of S$105 thousand** in the same period of 2025[7](index=7&type=chunk) - Basic and diluted earnings per share turned from a **loss of 0.16 Singapore cents** in the same period of 2024 to a **profit of 0.03 Singapore cents** in the same period of 2025[7](index=7&type=chunk) [Unaudited Condensed Consolidated Statement of Financial Position](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's net assets slightly decreased to S$23,228 thousand, while net current assets improved, indicating enhanced liquidity Condensed Consolidated Statement of Financial Position Key Data | Indicator | June 30, 2025 (S$ thousand) | December 31, 2024 (S$ thousand) | | :--- | :--- | :--- | | **ASSETS** | | | | Total non-current assets | 14,676 | 15,411 | | Total current assets | 21,380 | 21,516 | | **LIABILITIES** | | | | Total current liabilities | 6,243 | 6,681 | | Total non-current liabilities | 6,585 | 6,854 | | **EQUITY** | | | | Total equity | 23,228 | 23,392 | | Net current assets | 15,137 | 14,835 | | Total assets less current liabilities | 29,813 | 30,246 | | Net assets | 23,228 | 23,392 | - As of June 30, 2025, **net assets were S$23,228 thousand**, a slight decrease from S$23,392 thousand as of December 31, 2024[10](index=10&type=chunk) - **Net current assets increased from S$14,835 thousand** as of December 31, 2024, to **S$15,137 thousand** as of June 30, 2025[10](index=10&type=chunk) [Unaudited Condensed Consolidated Statement of Changes in Equity](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) Total equity attributable to owners decreased to S$23,228 thousand as of June 30, 2025, primarily due to exchange differences from translating foreign operations' financial statements, despite a period profit Condensed Consolidated Statement of Changes in Equity Key Data | Indicator | June 30, 2025 (S$ thousand) | January 1, 2025 (S$ thousand) | | :--- | :--- | :--- | | Share capital | 13,877 | 13,877 | | Reserves | 9,351 | 9,515 | | Total equity | 23,228 | 23,392 | | Profit for the period | 105 | - | | Exchange differences arising from translation of financial statements of foreign operations | (269) | - | - Profit for the period was **S$105 thousand**, compared to a **loss of S$374 thousand** in the same period of 2024[11](index=11&type=chunk) - Exchange differences arising from the translation of financial statements of foreign operations resulted in an **increase of S$269 thousand in other comprehensive expenses** for the period[11](index=11&type=chunk) [Unaudited Condensed Consolidated Statement of Cash Flows](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Net cash generated from operating activities significantly improved to S$2,014 thousand for the six months ended June 30, 2025, leading to an increase in cash and cash equivalents at period-end Condensed Consolidated Statement of Cash Flows Key Data | Indicator | H1 2025 (S$ thousand) | H1 2024 (S$ thousand) | | :--- | :--- | :--- | | Net cash generated from/(used in) operating activities | 2,014 | (3,285) | | Net cash used in investing activities | (44) | (307) | | Net cash used in/(generated from) financing activities | (594) | 11,108 | | Net increase in cash and cash equivalents | 1,376 | 7,516 | | Cash and cash equivalents at end of period | 8,214 | 9,044 | - Net cash generated from operating activities turned from **(S$3,285) thousand** in the same period of 2024 to **S$2,014 thousand** in the same period of 2025, indicating a significant improvement in operating cash flow[12](index=12&type=chunk) - Cash and cash equivalents at the end of the period **increased to S$8,214 thousand** from S$6,842 thousand at the beginning of the period[13](index=13&type=chunk) [Notes to the Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes explaining the basis of preparation, accounting policies, and specific financial statement line items [1. Company Information](index=11&type=section&id=1.%20Company%20Information) Cool Link (Holdings) Limited, incorporated in the Cayman Islands with its principal place of business in Singapore, primarily engages in investment holding and the supply of food and healthcare products - The Company is incorporated in the Cayman Islands, with its **principal place of business in Singapore**[14](index=14&type=chunk) - The Group is principally engaged in the **supply of food and healthcare products**[15](index=15&type=chunk) [2. Basis of Preparation and 3. Adoption of New and Revised Hong Kong Financial Reporting Standards](index=11&type=section&id=2.%20Basis%20of%20Preparation%20and%203.%20Adoption%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The interim financial statements are prepared in Singapore Dollars under HKAS 34 and GEM Listing Rules, adopting new HKSFRSs effective January 1, 2025, with no significant anticipated impact - The condensed consolidated financial statements are prepared in accordance with **Hong Kong Accounting Standard 34** and the GEM Listing Rules[16](index=16&type=chunk) - New and revised Hong Kong Financial Reporting Standards effective January 1, 2025, have been adopted and are **not expected to have a significant impact** on the financial statements[17](index=17&type=chunk)[18](index=18&type=chunk) - The financial statements are presented in **Singapore Dollars**, which is the Company's functional currency[16](index=16&type=chunk) [4. Revenue](index=12&type=section&id=4.%20Revenue) The Group's revenue for the six months ended June 30, 2025, was S$14,230 thousand, a slight decrease from the prior year, primarily derived from goods sales Revenue Details | Revenue Source | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Sale of goods | 14,230 | 14,678 | | Timing of revenue recognition: At a point in time | 14,230 | 14,678 | - For the six months ended June 30, 2025, revenue from the sale of goods was **S$14,230 thousand**, representing a **year-on-year decrease of 3.05%**[19](index=19&type=chunk) [5. Other Income and Other (Losses) and Gains](index=13&type=section&id=5.%20Other%20Income%20and%20Other%20(Losses)%20and%20Gains) Total other income and gains increased to S$153 thousand, mainly driven by a significant rise in interest income, despite decreases in rental income and government grants Other Income and Gains Details | Item | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Interest income | 175 | 20 | | Rental income from investment properties | 30 | 98 | | Fair value gains/(losses) on financial assets at fair value through profit or loss | 2 | (1) | | Government grants | 22 | 45 | | Others | (76) | (21) | | **Total** | **153** | **141** | - **Interest income significantly increased from S$20 thousand** in the same period of 2024 to **S$175 thousand** in the same period of 2025[20](index=20&type=chunk) [6. Finance Costs](index=13&type=section&id=6.%20Finance%20Costs) Finance costs increased by 20% to S$240 thousand for the six months ended June 30, 2025, primarily due to higher interest on borrowings Finance Costs Details | Item | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Interest on borrowings | 178 | 66 | | Finance charges on lease liabilities | 62 | 63 | | Interest on promissory notes | – | 71 | | **Total** | **240** | **200** | - Finance costs **increased by 20% year-on-year to S$240 thousand**, primarily due to an increase in **interest on borrowings from S$66 thousand to S$178 thousand**[21](index=21&type=chunk) [7. Profit/(Loss) Before Income Tax](index=14&type=section&id=7.%20Profit%2F(Loss)%20Before%20Income%20Tax) Profit before income tax significantly improved to S$240 thousand, reversing the prior year's loss, attributed to controlled costs and reduced net exchange losses Profit/(Loss) Before Income Tax Adjustments | Item | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Auditor's remuneration | 52 | 50 | | Cost of inventories sold | 10,357 | 10,521 | | Depreciation of property, plant and equipment | 361 | 355 | | Depreciation of right-of-use assets | 128 | 195 | | Depreciation of investment properties | 30 | 30 | | Amortisation of intangible assets | 43 | 28 | | Direct operating expenses from investment properties that generated rental income | 31 | 32 | | Employee benefit expenses (including directors' emoluments) | 1,704 | 2,025 | | Short-term leases and leases with lease terms of 12 months or less | 124 | 145 | | Net exchange losses | (80) | (19) | - Profit before income tax turned from a **loss of S$272 thousand** in the same period of 2024 to a **profit of S$240 thousand** in the same period of 2025[22](index=22&type=chunk) - **Employee benefit expenses (including directors' emoluments) decreased from S$2,025 thousand to S$1,704 thousand**[22](index=22&type=chunk) [8. Income Tax Expense](index=15&type=section&id=8.%20Income%20Tax%20Expense) Income tax expense increased to S$135 thousand, primarily due to higher current tax in Singapore, while deferred tax liabilities decreased Income Tax Expense Details | Item | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Current tax — Singapore | (156) | (107) | | Deferred tax | 21 | 5 | | **Total** | **(135)** | **(102)** | - Income tax expense **increased year-on-year to S$135 thousand**, with current tax in Singapore rising from **S$107 thousand to S$156 thousand**[23](index=23&type=chunk) [9. Earnings/(Loss) Per Share](index=15&type=section&id=9.%20Earnings%2F(Loss)%20Per%20Share) Basic earnings per share improved to S$0.03 cents for the six months ended June 30, 2025, from a loss in the prior year, with no dilutive effect Earnings/(Loss) Per Share Data | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit/(Loss) attributable to owners of the Company (S$ thousand) | 105 | (374) | | Weighted average number of ordinary shares (thousand shares) | 398,606 | 234,346 | - Profit attributable to owners of the Company turned from a **loss of S$374 thousand** in the same period of 2024 to a **profit of S$105 thousand** in the same period of 2025[24](index=24&type=chunk) - The **weighted average number of ordinary shares increased from 234,346 thousand shares** in the same period of 2024 to **398,606 thousand shares** in the same period of 2025, primarily due to the rights issue in 2024[24](index=24&type=chunk)[25](index=25&type=chunk) [10. Dividends](index=16&type=section&id=10.%20Dividends) The Board does not recommend paying any dividend for the six months ended June 30, 2025, consistent with the prior year - The Board does not recommend the payment of any dividend for the six months ended June 30, 2025 (2024: nil)[27](index=27&type=chunk) [11. Property, Plant and Equipment](index=16&type=section&id=11.%20Property%2C%20Plant%20and%20Equipment) Acquisitions of property, plant and equipment significantly decreased to S$44 thousand for the six months ended June 30, 2025, compared to the prior year - The Group's acquisitions of property, plant and equipment for the six months ended June 30, 2025, amounted to **S$44 thousand**, a **significant decrease from S$307 thousand** in the same period of 2024[28](index=28&type=chunk) [12. Goodwill](index=16&type=section&id=12.%20Goodwill) Goodwill's net carrying amount is zero as of June 30, 2025, due to a recognized impairment loss of S$2,577 thousand Goodwill Net Carrying Amount | Item | June 30, 2025 (S$ thousand) | December 31, 2024 (S$ thousand) | | :--- | :--- | :--- | | At beginning of reporting period | 2,577 | 2,577 | | Impairment loss recognised | (2,577) | (2,577) | | At end of reporting period | – | – | - The **net carrying amount of goodwill was zero** at the end of the reporting period due to a recognized **impairment loss of S$2,577 thousand**[29](index=29&type=chunk) [13. Trade Receivables](index=17&type=section&id=13.%20Trade%20Receivables) Net trade receivables slightly decreased to S$5,596 thousand as of June 30, 2025, with a notable shift in aging from 0-30 days to 31-90 days Trade Receivables and Aging Analysis | Item | June 30, 2025 (S$ thousand) | December 31, 2024 (S$ thousand) | | :--- | :--- | :--- | | Trade receivables | 5,656 | 5,860 | | Less: Provision for expected credit losses | (60) | (93) | | **Net amount** | **5,596** | **5,767** | | **Aging analysis:** | | | | 0 to 30 days | 2,441 | 4,602 | | 31 to 90 days | 3,104 | 1,144 | | 91 to 180 days | 79 | 21 | | Over 180 days | 32 | – | | **Total** | **5,656** | **5,767** | - **Net trade receivables decreased from S$5,767 thousand** as of December 31, 2024, to **S$5,596 thousand** as of June 30, 2025[30](index=30&type=chunk) - Trade receivables aged **0 to 30 days decreased from S$4,602 thousand to S$2,441 thousand**, while those aged **31 to 90 days increased from S$1,144 thousand to S$3,104 thousand**[30](index=30&type=chunk) [14. Trade Payables and 15. Bank Borrowings](index=18&type=section&id=14.%20Trade%20Payables%20and%2015.%20Bank%20Borrowings) Trade payables slightly increased to S$3,320 thousand, while total bank borrowings decreased to S$4,784 thousand, with most classified as non-current liabilities Trade Payables and Aging Analysis | Item | June 30, 2025 (S$ thousand) | December 31, 2024 (S$ thousand) | | :--- | :--- | :--- | | Trade payables | 3,320 | 3,231 | | **Aging analysis:** | | | | 0 to 30 days | 1,426 | 1,842 | | 31 to 90 days | 710 | 362 | | 91 to 180 days | 157 | – | | Over 180 days | 1,027 | 1,027 | | **Total** | **3,320** | **3,231** | Bank Borrowings Details | Item | June 30, 2025 (S$ thousand) | December 31, 2024 (S$ thousand) | | :--- | :--- | :--- | | Secured mortgage loans | 4,784 | 5,006 | | **Carrying amount repayable:** | | | | Within one year | 432 | 435 | | After one year but within two years | 451 | 458 | | After two years but within five years | 1,507 | 1,519 | | After five years | 2,394 | 2,594 | | **Total** | **4,784** | **5,006** | | **Classified as:** | | | | Non-current liabilities | 4,352 | 4,571 | | Current liabilities | 432 | 435 | | **Total** | **4,784** | **5,006** | - **Trade payables increased from S$3,231 thousand** as of December 31, 2024, to **S$3,320 thousand** as of June 30, 2025[31](index=31&type=chunk) - **Total bank borrowings decreased from S$5,006 thousand** as of December 31, 2024, to **S$4,784 thousand** as of June 30, 2025[31](index=31&type=chunk) [16. Share Capital](index=19&type=section&id=16.%20Share%20Capital) As of June 30, 2025, the Company's issued share capital remained unchanged at 398,606,168 ordinary shares with a par value of S$13,877 thousand, following a rights issue in 2024 Share Capital Movement Overview | Item | Number of Ordinary Shares | Par Value of Ordinary Shares (S$ thousand) | | :--- | :--- | :--- | | **Authorised:** | | | | As at December 31, 2024, January 1, 2025 and June 30, 2025 | 500,000,000 | 17,337 | | **Issued:** | | | | As at January 1, 2024 | 99,652,000 | 3,471 | | Shares issued upon rights issue | 298,954,168 | 10,406 | | As at December 31, 2024, January 1, 2025 and June 30, 2025 | 398,606,168 | 13,877 | - The **number of issued ordinary shares is 398,606,168**, with a **par value of S$13,877 thousand**, unchanged since December 31, 2024[32](index=32&type=chunk) - A rights issue was completed on April 10, 2024, issuing **298,954,168 shares** and raising **gross proceeds of approximately HK$100.2 million**[32](index=32&type=chunk) [17. Share Option Scheme](index=20&type=section&id=17.%20Share%20Option%20Scheme) The Company's share option scheme, effective August 30, 2017, aims to reward eligible participants, with maximum grants limited to 10% of issued shares and specific exercise price criteria - The Share Option Scheme became effective on **August 30, 2017**, aiming to **reward eligible participants** who have contributed to the Group's business[33](index=33&type=chunk) - The **maximum number of share options granted is 10% of the issued shares**, with a maximum of **1% for any single participant within a 12-month period**[33](index=33&type=chunk) - The exercise price of share options is determined by the Directors and shall not be less than the highest of the closing price on the Stock Exchange, the average closing price for the five preceding trading days, or the nominal value[34](index=34&type=chunk) [18. Capital Commitments](index=21&type=section&id=18.%20Capital%20Commitments) As of June 30, 2025, the Group had no capital commitments, consistent with the prior period - As of June 30, 2025, the Group had **no capital commitments** (December 31, 2024: nil)[36](index=36&type=chunk) [19. Related Party Transactions](index=21&type=section&id=19.%20Related%20Party%20Transactions) Key management personnel compensation decreased to S$442 thousand, primarily due to a reduction in short-term employee benefits Key Management Personnel Remuneration | Item | 2025 (S$ thousand) | 2024 (S$ thousand) | | :--- | :--- | :--- | | Short-term employee benefits | 417 | 451 | | Defined contributions | 25 | 26 | | **Total** | **442** | **477** | - **Total key management personnel remuneration decreased from S$477 thousand** in the same period of 2024 to **S$442 thousand** in the same period of 2025[37](index=37&type=chunk) [20. Fair Value Measurement](index=21&type=section&id=20.%20Fair%20Value%20Measurement) The Group's financial assets are measured at fair value across three levels, with no transfers between levels or changes in valuation methods during the reporting period Fair Value Hierarchy Disclosure (June 30, 2025) **As at June 30, 2025** | Item | Level 1 (S$ thousand) | Level 2 (S$ thousand) | Level 3 (S$ thousand) | Total (S$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Financial assets at fair value through profit or loss — Hong Kong listed equity securities | 14 | – | – | 14 | | Financial assets at fair value through other comprehensive income: Unlisted equity investments | – | – | 2,075 | 2,075 | | **Total** | **14** | **–** | **2,075** | **2,089** | Fair Value Hierarchy Disclosure (December 31, 2024) **As at December 31, 2024** | Item | Level 1 (S$ thousand) | Level 2 (S$ thousand) | Level 3 (S$ thousand) | Total (S$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Financial assets at fair value through profit or loss — Hong Kong listed equity securities | 12 | – | – | 12 | | Financial assets at fair value through other comprehensive income: Unlisted equity investments | – | – | 2,347 | 2,347 | | **Total** | **12** | **–** | **2,347** | **2,359** | - As of June 30, 2025, financial assets at fair value through profit or loss (Hong Kong listed equity securities) were **S$14 thousand**, and financial assets at fair value through other comprehensive income (unlisted equity investments) were **S$2,075 thousand**[39](index=39&type=chunk) - There were **no transfers between Level 1, Level 2, and Level 3** during the reporting period, and **no changes in the methods and valuation techniques** used to measure fair value[40](index=40&type=chunk)[41](index=41&type=chunk) [Management Discussion and Analysis](index=24&type=section&id=Management%20Discussion%20and%20Analysis) This section provides a review of the Group's business operations, financial performance, and future outlook, including liquidity, capital structure, and employee information [Business Review](index=24&type=section&id=Business%20Review) The Group, primarily engaged in food and healthcare product supply, achieved a profit of S$105 thousand, driven by reduced selling and distribution expenses, despite global supply chain complexities - The Group is primarily engaged in the **supply of food and healthcare products**, with customers mainly being **ship chandlers in Singapore**[44](index=44&type=chunk)[45](index=45&type=chunk) - The Group recorded a **profit of approximately S$105 thousand** for the period, compared to a **loss of S$374 thousand** in the same period last year, mainly due to a **reduction in selling and distribution expenses of approximately S$0.4 million**[45](index=45&type=chunk) - Key products sold include **cheese, juices, milk, ice cream, and bread**, along with value-added food processing services[45](index=45&type=chunk) [Outlook](index=25&type=section&id=Outlook) Facing geopolitical risks and economic uncertainties, the Group remains committed to brand promotion, product quality, exploring new opportunities, and implementing diversified strategies for sustainable growth and profitability - Ongoing geopolitical risks, the Russia-Ukraine war, and interest rate changes pose challenges to the global economy, making the Group's **outlook full of uncertainties**[46](index=46&type=chunk) - The Group will continue to focus on **brand promotion, providing quality products, exploring diversified opportunities to broaden revenue streams, and increasing market share**[46](index=46&type=chunk) - The Board remains optimistic and will take necessary actions to **minimize the impact on core businesses**, while striving to **expand operations for sustainable growth and enhanced profitability**[46](index=46&type=chunk) [Financial Review](index=25&type=section&id=Financial%20Review) Revenue decreased by 3.4% to S$14.2 million, but effective cost control improved gross margin to 27.5%, and reduced operating expenses led to a profit of S$105 thousand, reversing the prior year's loss Financial Review Key Data | Indicator | H1 2025 (S$ thousand) | H1 2024 (S$ thousand) | Change (S$ thousand) | Change Percentage | Primary Reason | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 14,230 | 14,678 | (448) | -3.05% | Decrease in sales volume of frozen products | | Cost of sales | 10,357 | 10,813 | (456) | -4.22% | Maintained at a similar level | | Gross profit | 3,873 | 3,865 | 8 | 0.21% | - | | Gross profit margin | 27.22% | 26.33% | 0.89% | - | Effective cost control | | Selling and distribution costs | 1,104 | 1,472 | (368) | -25.00% | Decrease in advertising and promotion expenses | | Administrative and other operating expenses | 2,442 | 2,584 | (142) | -5.49% | Decrease in salaries and other operating costs | | Finance costs | 240 | 200 | 40 | 20.00% | Increase in interest expense on bank borrowings | | Profit/(Loss) for the period | 105 | (374) | 479 | - | Decrease in selling and distribution costs | [Capital Structure](index=27&type=section&id=Capital%20Structure) Details of the Company's share capital are provided in Note 16 to the condensed consolidated financial statements - Details of the Company's share capital are set out in **Note 16** to the condensed consolidated financial statements in this interim report[54](index=54&type=chunk) [Liquidity and Financial Resources](index=27&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's working capital is sourced from internal resources, placements, and bank borrowings, with an improved quick ratio of 2.36 times indicating enhanced liquidity - The Group's working capital is funded by **internal resources, placements, and bank and other borrowings**[55](index=55&type=chunk) - As of June 30, 2025, the **quick ratio was approximately 2.36 times** (December 31, 2024: 2.13 times), indicating **improved liquidity**[55](index=55&type=chunk) [Gearing Ratio](index=27&type=section&id=Gearing%20Ratio) Total borrowings decreased to approximately S$7.1 million, resulting in a slightly lower gearing ratio of 30.7%, indicating reduced financial leverage - As of June 30, 2025, **total borrowings were approximately S$7.1 million** (December 31, 2024: S$7.4 million)[56](index=56&type=chunk) - The **gearing ratio was approximately 30.7%** (December 31, 2024: 31.5%), representing a **slight decrease**[56](index=56&type=chunk) [Capital Expenditure](index=27&type=section&id=Capital%20Expenditure) For the six months ended June 30, 2025, the Group incurred no significant capital expenditure related to property, plant, and equipment acquisitions - For the six months ended June 30, 2025, the Group incurred **no significant capital expenditure** primarily related to the acquisition of property, plant and equipment[57](index=57&type=chunk) [Capital Commitments](index=27&type=section&id=Capital%20Commitments) As of June 30, 2025, the Group had no significant capital commitments, consistent with the prior period - As of June 30, 2025, the Group had **no material capital commitments** (December 31, 2024: nil)[58](index=58&type=chunk) [Pledge of the Group's Assets](index=27&type=section&id=Pledge%20of%20the%20Group's%20Assets) As of June 30, 2025, the Group pledged approximately S$1.5 million in bank deposits, S$6.9 million in land and buildings, and S$0.6 million in investment properties to secure bank facilities - As of June 30, 2025, the Group had pledged **approximately S$1.5 million in bank deposits, S$6.9 million in land and buildings, and S$0.6 million in investment properties** to secure bank facilities[59](index=59&type=chunk) [Significant Investments, Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=28&type=section&id=Significant%20Investments%2C%20Material%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%20and%20Joint%20Ventures) For the six months ended June 30, 2025, the Group made no significant investments, material acquisitions, or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the Group made **no significant investments, material acquisitions, or disposals of subsidiaries, associates, and joint ventures**[60](index=60&type=chunk) [Future Plans for Material Investments and Capital Assets](index=28&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) As of June 30, 2025, the Group had no other future plans for material investments and capital assets - As of June 30, 2025, the Group had **no other future plans for material investments and capital assets**[61](index=61&type=chunk) [Contingent Liabilities](index=28&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had contingent liabilities of S$948 thousand for performance bonds, secured by leased properties, investment properties, and corporate guarantees - As of June 30, 2025, the Group had **contingent liabilities of S$948 thousand** for issued performance bonds (December 31, 2024: S$946 thousand)[62](index=62&type=chunk) - Guarantees for bank-issued performance bonds are secured by **leased properties, investment properties, and corporate guarantees** of the Company[62](index=62&type=chunk) [Information on Employees and Remuneration Policies](index=28&type=section&id=Information%20on%20Employees%20and%20Remuneration%20Policies) As of June 30, 2025, the Group employed 66 staff with total employee costs of approximately S$1.7 million, offering competitive remuneration, a share option scheme, and training programs - As of June 30, 2025, the Group employed **66 employees** (December 31, 2024: 64 employees)[63](index=63&type=chunk) - Total staff costs for the six months ended June 30, 2025, were **approximately S$1.7 million** (same period in 2024: S$2.0 million)[63](index=63&type=chunk) - The Group has adopted a **share option scheme** and provides various **training courses** to enhance employee skills and capabilities[63](index=63&type=chunk) [Other Information](index=29&type=section&id=Other%20Information) This section covers the use of proceeds, interests of directors and major shareholders, securities transactions, share option and award schemes, competition, corporate governance, and audit committee review [Use of Proceeds](index=29&type=section&id=Use%20of%20Proceeds) As of June 30, 2024, net proceeds from the rights issue were partially utilized, with some categories fully expended and others, like M&A and property acquisition, having unutilized balances expected to be used by 2025 Use of Proceeds from Rights Issue | Use | Original Intended Use of Net Proceeds (HK$ thousand) | Actual Use of Net Proceeds as at June 30, 2025 (HK$ thousand) | Unutilised Net Proceeds as at June 30, 2025 (HK$ thousand) | | :--- | :--- | :--- | :--- | | Repayment of promissory notes | 18,000 | 18,000 | – | | Mergers and acquisitions | 30,000 | – | 30,000 | | Acquisition and replacement of property, plant and equipment | 6,000 | 1,144 | 4,856 | | Upgrading of information technology system | 2,000 | 2,000 | – | | Advertising and promotion expenses | 3,000 | 3,000 | – | | Working capital | 38,900 | 38,900 | – | | **Total** | **97,900** | **63,044** | **34,856** | - Among the net proceeds from the rights issue, funds for **repayment of promissory notes, upgrading IT systems, advertising and promotion expenses, and working capital have been fully utilized**[64](index=64&type=chunk) - **Unutilized balances remain for mergers and acquisitions (HK$30,000 thousand) and acquisition and replacement of property, plant and equipment (HK$4,856 thousand)**[64](index=64&type=chunk) [Directors', Chief Executive's and Substantial Shareholders' Interests and Short Positions in Shares, Underlying Shares and Debentures](index=30&type=section&id=Directors'%2C%20Chief%20Executive's%20and%20Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) As of June 30, 2025, several directors and substantial shareholders held long positions in the Company's shares, with Mr. Kwok Kwai Sin holding a combined 21.71% interest Directors' and Chief Executive's Long Positions in Shares and Underlying Shares | Name | Capacity/Nature of Interest | Number of Shares Held/Interested | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Chan Siu Yee | Beneficial owner/Personal interest | 11,760,000 | 2.95% | | Mr. Ngai Chiu Cheung | Beneficial owner/Personal interest/Spouse's interest | 13,107,000 | 3.29% | | Ms. Yeung Po Chu | Spouse's interest | 13,107,000 | 3.29% | | Zumegnsi Technology Group Limited | Beneficial owner | 59,670,000 | 14.97% | | Mr. Kwok Kwai Sin | Beneficial owner | 26,865,000 | 6.74% | Substantial Shareholders' and Other Persons' Long Positions in Shares and Underlying Shares | Name | Capacity/Nature of Interest | Number of Shares Held/Interested | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Metaverse (International) Securities Limited | Trustee of the scheme/Other | 36,445,000 | 9.14% | - Mr. Kwok Kwai Sin directly holds **6.74% of shares** and indirectly holds **14.97% of shares through Zumegnsi Technology Group Limited**, totaling a **21.71% interest**[65](index=65&type=chunk)[68](index=68&type=chunk) - Metaverse (International) Securities Limited, as trustee of the Share Award Scheme, holds **36,445,000 shares**, representing **9.14% of the issued shares**[67](index=67&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=32&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%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 - 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**[69](index=69&type=chunk) [Share Option Scheme](index=32&type=section&id=Share%20Option%20Scheme) The Company's share option scheme, adopted on August 30, 2017, aims to attract, retain, and reward eligible individuals, with no options granted, exercised, cancelled, or lapsed during the period - The Company adopted a Share Option Scheme on **August 30, 2017**, aiming to **attract, retain, and reward eligible persons**[70](index=70&type=chunk) - For the six months ended June 30, 2025, **no share options were granted, exercised, cancelled, or lapsed**[71](index=71&type=chunk) [Share Award Scheme](index=32&type=section&id=Share%20Award%20Scheme) Adopted on September 14, 2021, the Share Award Scheme rewards contributors and retains talent, with the trustee having purchased 36,445,000 shares, but no awards granted as of June 30, 2025 - The Company adopted a Share Award Scheme on **September 14, 2021**, to **reward eligible participants** who have contributed to the Group and to **attract and retain talent**[72](index=72&type=chunk) - The trustee has utilized **approximately HK$17,989 thousand** to purchase **36,445,000 shares** in the market, representing **9.14% of the issued shares** as of the reporting date[73](index=73&type=chunk) - As of June 30, 2025, **no award shares were granted** under the scheme[73](index=73&type=chunk) [Competition and Conflicts of Interest](index=33&type=section&id=Competition%20and%20Conflicts%20of%20Interest) For the six months ended June 30, 2025, no directors, substantial shareholders, or their close associates engaged in competing businesses or had other conflicts of interest with the Group - For the six months ended June 30, 2025, **no directors, substantial shareholders, or their respective close associates engaged in any business that competes or may compete with the Group's business**, nor did they have any other conflicts of interest with the Group[75](index=75&type=chunk) [Compliance with Corporate Governance Code](index=34&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company maintains high standards of corporate governance and has complied with the code provisions of the Corporate Governance Code in Appendix 15 to the GEM Listing Rules - The Company has **complied with the code provisions** of the Corporate Governance Code as set out in Appendix 15 to the GEM Listing Rules[76](index=76&type=chunk) [Directors' Securities Transactions](index=34&type=section&id=Directors'%20Securities%20Transactions) All directors confirmed that for the six months ended June 30, 2025, they have fully complied with the required standards for securities transactions as set out in Rules 5.48 to 5.67 of the GEM Listing Rules - All Directors confirmed that for the six months ended June 30, 2025, they have **fully complied with the required standards for securities transactions** as set out in Rules 5.48 to 5.67 of the GEM Listing Rules[77](index=77&type=chunk) [Audit Committee](index=34&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors, reviewed the interim report and financial statements, confirming compliance with accounting standards, GEM Listing Rules, and adequate disclosure - The Audit Committee is composed of **three independent non-executive Directors**, with **Ms. Chan Wai Nga as the chairperson**[78](index=78&type=chunk) - The Audit Committee has reviewed this interim report and the unaudited condensed consolidated financial statements, deeming them to be in **compliance with applicable accounting standards, the GEM Listing Rules, and other legal requirements, with adequate disclosure**[78](index=78&type=chunk)

中 國 建 材 股 份 有 限 公 司 （股份代號：03323） 中期報告 僅供識別 本報告採用環保紙打印製造。 202 5 中期報 告 目 錄 中報速覽 .................................................................. 2 公司資料 .................................................................. 4 本集團股權架構 ............................................................... 7 財務數據摘要 ................................................................... 8 業務數據摘要 ................................................................... 9 管理層討論與分析 ...................................................... ...

[Financial Statements](index=1&type=section&id=Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for the six months ended June 30, 2025, reflecting the company's financial performance and position [Interim Condensed Consolidated Income Statement](index=1&type=section&id=Interim%20Condensed%20Consolidated%20Income%20Statement) For the six months ended June 30, 2025, revenue grew by 12.4%, but gross profit and interim loss expanded due to increased cost of sales and reduced R&D expenses Interim Condensed Consolidated Income Statement Summary | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Revenue | 1,627,054 | 1,447,238 | | Cost of sales | (1,478,401) | (1,225,498) | | Gross profit | 148,653 | 221,740 | | Operating loss | (13,646) | (35,937) | | Loss before tax | (20,331) | (42,431) | | Income tax expense | (9,378) | (9,163) | | Interim loss | (29,709) | (51,594) | | Loss per share attributable to ordinary equity holders of the Company (HK cents per share) | (3.45) | (8.98) | [Interim Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, total interim comprehensive income improved significantly to HKD 35.8 million, driven by exchange gains from overseas operations Interim Condensed Consolidated Statement of Comprehensive Income Summary | Indicator | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Interim loss | (29,709) | (51,594) | | Exchange differences on translation of overseas operations | 69,013 | (21,158) | | Remeasurement loss on defined benefit plans, net of income tax | (3,491) | (1,408) | | Other comprehensive income/(loss) for the period, net of income tax | 65,522 | (22,566) | | Total comprehensive income/(loss) for the period | 35,813 | (74,160) | [Interim Condensed Consolidated Statement of Financial Position](index=3&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, total assets, liabilities, and equity increased, driven by higher trade receivables and shifts in non-current asset composition Interim Condensed Consolidated Statement of Financial Position Summary | Indicator | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | **ASSETS** | | | | Total non-current assets | 946,946 | 976,782 | | Total current assets | 1,149,920 | 1,055,853 | | **TOTAL ASSETS** | **2,096,866** | **2,032,635** | | **LIABILITIES** | | | | Total current liabilities | 923,061 | 903,687 | | Total non-current liabilities | 388,170 | 379,126 | | **TOTAL LIABILITIES** | **1,311,231** | **1,282,813** | | **EQUITY** | | | | Total equity | 785,635 | 749,822 | | **TOTAL EQUITY AND LIABILITIES** | **2,096,866** | **2,032,635** | [Notes to Interim Condensed Consolidated Financial Information](index=5&type=section&id=Notes%20to%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section provides detailed notes to the interim condensed consolidated financial information, offering supplementary explanations for understanding the financial statements [1. General Information](index=5&type=section&id=1.%20General%20Information) This section covers the company's registration, business, holding structure, and significant events, including the planned closure of the Czech plant [1.1 Company and Group Information](index=5&type=section&id=1.1%20Company%20and%20Group%20Information) Registered in the Cayman Islands, the company manufactures and trades automotive parts and provides technical services, with Zhangjiakou Industrial Investment Holding Group as its ultimate holding company - The company primarily engages in the manufacturing, sales, and trading of automotive parts and components, and provides technical services[9](index=9&type=chunk) - The ultimate holding company is Zhangjiakou Industrial Investment Holding Group Co., Ltd., a state-owned enterprise established in the People's Republic of China[10](index=10&type=chunk) [1.2 Significant Events during the Reporting Period](index=5&type=section&id=1.2%20Significant%20Events%20during%20the%20Reporting%20Period) The Board resolved to close the Czech plant in Q3 2025 to enhance efficiency, incurring approximately HKD 80.44 million in one-off costs and impairment losses - The Board resolved to commence a phased closure of the Cheb plant in the Czech Republic starting in Q3 2025 to enhance overall operational efficiency[12](index=12&type=chunk) - The closure of the Czech plant is expected to incur one-off costs/expenses and impairment losses, including lease termination fees, employee severance payments, impairment of property, plant and equipment, and refund of income tax benefits[12](index=12&type=chunk) - The net impact of the closure plan recognized in the current reporting period's financial information totaled a net deduction of approximately **HKD 80.44 million**, which includes a provision for refund of income tax benefits of **HKD 6.808 million**[13](index=13&type=chunk) [2. Basis of Preparation and Summary of Accounting Policies](index=6&type=section&id=2.%20Basis%20of%20Preparation%20and%20Summary%20of%20Accounting%20Policies) This section outlines the basis of preparation for interim financial information, adhering to HKAS 34, and details adopted and future accounting standards [2.1 Basis of Preparation](index=6&type=section&id=2.1%20Basis%20of%20Preparation) Interim financial information is prepared under HKAS 34 'Interim Financial Reporting' and presented in HKD, with amounts rounded to the nearest thousand - The interim financial information is prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the Hong Kong Institute of Certified Public Accountants[14](index=14&type=chunk) - The interim financial information is presented in Hong Kong Dollars, with all amounts adjusted to the nearest thousand Hong Kong Dollars[14](index=14&type=chunk) [2.2 Changes in Accounting Policies](index=6&type=section&id=2.2%20Changes%20in%20Accounting%20Policies) The Group adopted HKFRS 21 (Amendment) 'Lack of Exchangeability' from January 1, 2025, with no significant impact, while HKFRS 18 is expected to broadly affect future financial statement presentation - The Group first applied HKFRS 21 (Amendment) 'Lack of Exchangeability' from January 1, 2025, which is not expected to have a significant impact[15](index=15&type=chunk) - HKFRS 18 'Presentation and Disclosure in Financial Statements' is expected to have a pervasive impact on the presentation and disclosure of the Group's consolidated financial statements, effective January 1, 2027[16](index=16&type=chunk)[17](index=17&type=chunk) [3. Revenue and Segment Information](index=8&type=section&id=3.%20Revenue%20and%20Segment%20Information) The Group operates as a single segment, manufacturing and selling automotive parts and providing technical services, with revenue primarily from industrial product sales in Germany, UK, and US, and notable growth in mainland China [3(a) Revenue from Contracts with Customers](index=8&type=section&id=3(a)%20Revenue%20from%20Contracts%20with%20Customers) For the six months ended June 30, 2025, total revenue increased by 12.4% to HKD 1,627,054 thousand, primarily from industrial product sales, with most revenue recognized at a point in time Revenue Composition | Products and Services | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Sales of industrial products and others | 1,527,434 | 1,336,116 | | Technical service income | 99,620 | 111,122 | | **Total Revenue** | **1,627,054** | **1,447,238** | Revenue Recognition Timing | Revenue Recognition | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | At a point in time | 1,623,985 | 1,444,408 | | Over time | 3,069 | 2,830 | | **Total Revenue** | **1,627,054** | **1,447,238** | [3(b) Geographical Information](index=9&type=section&id=3(b)%20Geographical%20Information) Germany, UK, and US remain key revenue sources, with notable growth in UK and mainland China revenue, while Czech non-current assets decreased due to plant closure Revenue from External Customers (by Customer Location) | Region | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Germany | 455,294 | 472,751 | | United Kingdom | 366,093 | 239,277 | | United States | 327,707 | 338,790 | | Mainland China | 114,960 | 77,813 | | Other countries | 363,000 | 318,607 | | **Total** | **1,627,054** | **1,447,238** | Non-current Assets (by Asset Location) | Region | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Poland | 789,554 | 671,121 | | Czech Republic | 101,849 | 222,768 | | Other countries | 47,658 | 78,205 | | **Total** | **939,061** | **972,094** | [3(c) Major Customer Information](index=10&type=section&id=3(c)%20Major%20Customer%20Information) Two external customers contributed over 10% of total revenue, totaling HKD 522.51 million, a significant increase from the prior period Major Customer Revenue Contribution | Customer | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Customer A | 284,160 | 231,058 | | Customer B | 238,350 | 142,814 | | **Total** | **522,510** | **373,872** | - For the six months ended June 30, 2025, two external customers contributed over **10%** of the Group's total revenue, compared to only one in the prior year[23](index=23&type=chunk) [4. Expenses by Nature](index=10&type=section&id=4.%20Expenses%20by%20Nature) For the six months ended June 30, 2025, total expenses increased by 11.3% to HKD 1,667.3 million, driven by raw material costs and employee benefits, with HKD 73.6 million in provisions for the Czech plant closure Major Expense Components | Expense Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Cost of raw materials sold and consumed | 950,732 | 893,963 | | Employee benefit expenses | 392,276 | 289,307 | | Provisions and losses arising from planned closure of Czech plant | 73,636 | – | | Utility expenses | 56,909 | 68,039 | | Depreciation and amortisation expenses | 54,502 | 46,089 | | Research and development costs | 30,168 | 49,972 | | Research and testing expenses | 22,852 | 41,214 | | **Total** | **1,667,277** | **1,498,031** | - Provisions and losses of **HKD 73,636 thousand** arose from the planned closure of the Czech plant[24](index=24&type=chunk) [5. Other Income](index=11&type=section&id=5.%20Other%20Income) For the six months ended June 30, 2025, other income increased by 32.5% to HKD 21.6 million, driven by higher profits from selling scrap, prototypes, and samples Other Income Components | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Profit from sales of scrap, prototypes and samples | 15,696 | 12,298 | | Bank interest income | 172 | 283 | | Others | 5,741 | 3,725 | | **Total** | **21,609** | **16,306** | [6. Net Other Gains](index=11&type=section&id=6.%20Net%20Other%20Gains) For the six months ended June 30, 2025, net other gains significantly increased to HKD 11.4 million, primarily due to a substantial rise in net exchange differences Net Other Gains Components | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Net exchange differences | 12,254 | 2,409 | | Net (loss)/gain on disposal of property, plant and equipment | (848) | 1,086 | | **Total** | **11,406** | **3,495** | [7. Finance Costs](index=11&type=section&id=7.%20Finance%20Costs) For the six months ended June 30, 2025, finance costs slightly increased to HKD 6.7 million, mainly from interest on defined benefit plans and lease liabilities Finance Costs Components | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Interest on defined benefit plans | 2,400 | 2,100 | | Interest on lease liabilities | 4,285 | 4,098 | | Others | – | 296 | | **Total** | **6,685** | **6,494** | [8. Income Tax Expense](index=12&type=section&id=8.%20Income%20Tax%20Expense) For the six months ended June 30, 2025, income tax expense was HKD 9.4 million, including HKD 6.8 million in tax benefits to be refunded due to the Czech plant closure Income Tax Expense Components | Item | 2025 (HKD thousands) | 2024 (HKD thousands) | | :--- | :--- | :--- | | Current income tax expense | 12,560 | 36,681 | | Deferred tax | (3,182) | (27,518) | | **Total tax expense for the period** | **9,378** | **9,163** | - Current income tax expense for the six months ended June 30, 2025, includes approximately **HKD 6.808 million** in income tax benefits to be refunded due to the planned closure of the Czech plant[28](index=28&type=chunk) [9. Loss Per Share](index=12&type=section&id=9.%20Loss%20Per%20Share) For the six months ended June 30, 2025, basic and diluted loss per share narrowed to HKD 3.45 cents, driven by reduced loss and more outstanding shares Loss Per Share | Indicator | 2025 (HK cents) | 2024 (HK cents) | | :--- | :--- | :--- | | Basic and diluted loss per share | (3.45) | (8.98) | - Basic loss per share is calculated based on the loss for the period attributable to ordinary equity holders of the Company and the weighted average number of ordinary shares outstanding of **861,508,602** shares (2024: **574,339,068** shares) during the period[29](index=29&type=chunk) - Diluted loss per share is the same as basic loss per share as the Group had no potentially dilutive ordinary shares during the reporting period[29](index=29&type=chunk) [10. Dividends](index=12&type=section&id=10.%20Dividends) The Board did not declare an interim dividend for the six months ended June 30, 2025, consistent with the prior year - The Board did not declare an interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[30](index=30&type=chunk) [11. Trade Receivables - Third Parties](index=13&type=section&id=11.%20Trade%20Receivables%20-%20Third%20Parties) As of June 30, 2025, net trade receivables from third parties significantly increased to HKD 475.8 million, with most due within three months under a typical one-to-three-month credit period Trade Receivables - Third Parties | Item | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Trade receivables | 483,460 | 291,826 | | Less: Provision for impairment losses | (7,681) | (5,144) | | **Net** | **475,779** | **286,682** | Ageing Analysis of Trade Receivables - Third Parties | Ageing | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 470,593 | 284,678 | | 3 months to 1 year | 5,186 | 2,004 | | **Total** | **475,779** | **286,682** | - The credit period granted to customers is generally one to three months, and the Group seeks to strictly control its outstanding receivables and has monitoring procedures to minimize credit risk[31](index=31&type=chunk) [12. Trade Receivables - Related Parties](index=14&type=section&id=12.%20Trade%20Receivables%20-%20Related%20Parties) As of June 30, 2025, related party trade receivables decreased to HKD 225.5 million, with an increase in overdue amounts over one year, for which no collateral is held Ageing Analysis of Trade Receivables - Related Parties | Ageing | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 151,825 | 196,748 | | 3 months to 1 year | 54,901 | 131,244 | | Over 1 year | 18,773 | 4,128 | | **Total** | **225,499** | **332,120** | - The Group's trade terms with its related parties are primarily on credit, and no collateral or other credit enhancements are held for its trade receivables balances from related parties[33](index=33&type=chunk) [13. Prepayments, Other Receivables and Other Assets](index=14&type=section&id=13.%20Prepayments,%20Other%20Receivables%20and%20Other%20Assets) As of June 30, 2025, total prepayments, other receivables, and other assets increased to HKD 126.4 million, mainly due to higher input VAT and prepayments Prepayments, Other Receivables and Other Assets Components | Item | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Input VAT | 61,405 | 39,075 | | Prepayments | 19,027 | 12,755 | | Contract costs | 33,416 | 29,968 | | Deposits, other receivables and others | 12,566 | 7,295 | | **Total** | **126,414** | **89,093** | [14. Trade Payables - Third Parties](index=14&type=section&id=14.%20Trade%20Payables%20-%20Third%20Parties) As of June 30, 2025, third-party trade payables increased to HKD 498.1 million, with most settled within three months under typical 30-to-90-day terms Ageing Analysis of Trade Payables - Third Parties | Ageing | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 489,527 | 387,834 | | 3 months to 1 year | 8,160 | 1,233 | | Over 1 year | 399 | 238 | | **Total** | **498,086** | **389,305** | - Trade payables are interest-free and normally settled within a term of thirty to ninety days[35](index=35&type=chunk) [15. Trade Payables - Related Parties](index=15&type=section&id=15.%20Trade%20Payables%20-%20Related%20Parties) As of June 30, 2025, related party trade payables significantly decreased to HKD 155.8 million, despite an increase in amounts overdue for over one year Ageing Analysis of Trade Payables - Related Parties | Ageing | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Within 3 months | 86,691 | 237,311 | | Over 1 year | 69,103 | 57,635 | | **Total** | **155,794** | **294,946** | [16. Contract Liabilities, Other Payables and Accrued Expenses](index=15&type=section&id=16.%20Contract%20Liabilities,%20Other%20Payables%20and%20Accrued%20Expenses) As of June 30, 2025, total contract liabilities, other payables, and accrued expenses were HKD 193.0 million, with HKD 2.5 million revenue recognized from opening contract liabilities Contract Liabilities, Other Payables and Accrued Expenses Components | Item | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Contract liabilities | 24,456 | 58,913 | | Other payables and accrued expenses | 59,752 | 60,314 | | Other tax payables | 10,031 | 7,255 | | Accrued salaries, wages, severance payments and benefits | 79,313 | 49,687 | | Accrued price discounts | 19,455 | 13,261 | | **Total** | **193,007** | **189,430** | | Non-current portion of contract liabilities | (20,941) | (52,620) | | **Current portion** | **172,066** | **136,810** | - Revenue recognized from the opening balance of contract liabilities for the six months ended June 30, 2025, was **HKD 2.536 million**[37](index=37&type=chunk) [17. Issued Share Capital](index=16&type=section&id=17.%20Issued%20Share%20Capital) As of June 30, 2025, issued share capital was HKD 86,151 thousand, consisting of 861,508,602 ordinary shares at HKD 0.10 par value, with no changes during the period Issued Share Capital | Item | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Authorised share capital (2,000,000,000 shares) | 200,000 | 200,000 | | Issued and fully paid share capital (861,508,602 shares) | 86,151 | 86,151 | - There were no changes in the Company's issued share capital for the six months ended June 30, 2025, and 2024[38](index=38&type=chunk) [18. Commitments](index=16&type=section&id=18.%20Commitments) As of June 30, 2025, contracted capital commitments for plant and machinery decreased to HKD 106.8 million, with no provisions made Capital Commitments | Item | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Contracted but not provided for: plant and machinery | 106,789 | 115,842 | [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's detailed analysis of the Group's operations and financial performance, highlighting the impact of the Czech plant closure on future efficiency [Operations Review](index=17&type=section&id=Operations%20Review) The Group manufactures and trades automotive suspension products and provides technical services from European plants, maintaining long-term relationships with major European automakers and suppliers - The Group is engaged in the manufacturing, sales, and trading of automotive parts and components, with suspension products as core products, and provides technical services[42](index=42&type=chunk) - The Group operates two major plants in Poland and the Czech Republic, manufacturing and assembling suspension products for renowned European automotive manufacturers[42](index=42&type=chunk) - The Group primarily sources raw materials and components from selected European suppliers, maintaining stable relationships and not relying on any single supplier[42](index=42&type=chunk) [Financial Review](index=17&type=section&id=Financial%20Review) This section analyzes the Group's financial performance, including revenue growth, declining gross profit, reduced R&D expenses, increased other income, and narrowed loss, explaining the Czech plant closure's impact [Revenue (Financial Review)](index=17&type=section&id=Revenue%20(Financial%20Review)) For the period ended June 30, 2025, total revenue grew by 12.4% to HKD 1,527.4 million from suspension product sales and HKD 99.6 million from technical services, driven by Polish plant orders despite Czech plant closure impacts Revenue (Sales of Suspension Products) | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Revenue from sales of suspension products | 1,527.4 | 1,336.1 | Revenue (Technical Services) | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Technical service income | 99.6 | 111.1 | - The increase in revenue was primarily due to an increase in order volume at the Polish plant, while revenue from the Czech plant decreased due to the planned closure[43](index=43&type=chunk) [Gross Profit and Gross Margin](index=18&type=section&id=Gross%20Profit%20and%20Gross%20Margin) For the period ended June 30, 2025, gross profit decreased to HKD 148.7 million and gross margin to 9.1%, mainly due to underutilization and closure provisions at the Czech plant Gross Profit and Gross Margin | Indicator | 2025 (HKD millions/%) | 2024 (HKD millions/%) | | :--- | :--- | :--- | | Gross profit | 148.7 | 221.7 | | Gross margin | 9.1% | 15.3% | - Both gross profit and gross margin decreased compared to the prior year, primarily due to lower-than-expected utilization at the Czech plant and provisions and losses arising from the closure plan[44](index=44&type=chunk) - Management expects the closure of the Czech plant to be completed by the end of Q1 next year, which will help consolidate resources, reduce manufacturing costs, and improve overall capacity utilization[44](index=44&type=chunk) [Selling and Distribution Expenses](index=18&type=section&id=Selling%20and%20Distribution%20Expenses) For the period ended June 30, 2025, selling and distribution expenses remained stable at HKD 11.5 million, mainly comprising sales staff salaries and benefits Selling and Distribution Expenses | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Selling and distribution expenses | 11.5 | 11.5 | [Administrative Expenses](index=18&type=section&id=Administrative%20Expenses) For the period ended June 30, 2025, administrative expenses slightly increased to HKD 86.5 million, mainly due to administrative staff salaries and management service fees Administrative Expenses | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Administrative expenses | 86.5 | 83.6 | [Research and Development Expenses](index=18&type=section&id=Research%20and%20Development%20Expenses) For the period ended June 30, 2025, R&D expenses significantly decreased by 48.8% to HKD 90.8 million, due to enhanced cost control and reduced new project expenditures Research and Development Expenses | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Research and development expenses | 90.8 | 177.4 | - The decrease in R&D expenses was primarily attributable to enhanced cost control and a significant reduction in R&D expenditures on new projects[47](index=47&type=chunk) [Other Income (Financial Review)](index=19&type=section&id=Other%20Income%20(Financial%20Review)) For the period ended June 30, 2025, other income increased by 32.5% to HKD 21.6 million, driven by higher profits from selling scrap, prototypes, and samples Other Income | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Other income | 21.6 | 16.3 | [Net Other Gains (Financial Review)](index=19&type=section&id=Net%20Other%20Gains%20(Financial%20Review)) For the period ended June 30, 2025, net other gains increased to HKD 11.4 million, primarily due to higher net exchange gains Net Other Gains | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Net other gains | 11.4 | 3.5 | [Finance Costs (Financial Review)](index=19&type=section&id=Finance%20Costs%20(Financial%20Review)) For the period ended June 30, 2025, finance costs slightly increased to HKD 6.7 million, mainly from interest on lease liabilities and defined benefit obligations Finance Costs | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Finance costs | 6.7 | 6.5 | [Loss for the Period Attributable to Owners of the Company](index=19&type=section&id=Loss%20for%20the%20Period%20Attributable%20to%20Owners%20of%20the%20Company) For the period ended June 30, 2025, loss attributable to owners of the Company narrowed to HKD 29.7 million, an improvement from the prior year's HKD 51.6 million loss Loss for the Period Attributable to Owners of the Company | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Loss for the period | (29.7) | (51.6) | [Liquidity and Financial Resources](index=19&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's operations require substantial working capital, with a net cash outflow of HKD 2.9 million from operations and cash and cash equivalents of HKD 96.3 million as of June 30, 2025 - The Group's operations require substantial working capital, primarily to fund purchases of raw materials, employee remuneration, capital expenditures, R&D, and other expenses[52](index=52&type=chunk) Cash Flow from Operating Activities | Item | 2025 (HKD millions) | 2024 (HKD millions) | | :--- | :--- | :--- | | Net cash flow from operating activities | (2.9) (Outflow) | 77.1 (Inflow) | Cash and Cash Equivalents | Date | Amount (HKD millions) | | :--- | :--- | | June 30, 2025 | 96.3 | | December 31, 2024 | 134.1 | [Debt](index=20&type=section&id=Debt) As of June 30, 2025, and December 31, 2024, the Group had no bank or other borrowing balances, maintaining a 0% debt-to-asset ratio - As of June 30, 2025, and December 31, 2024, the Group had no bank or other borrowing balances[53](index=53&type=chunk) Debt-to-Asset Ratio | Date | Debt-to-Asset Ratio | | :--- | :--- | | June 30, 2025 | 0% | | December 31, 2024 | 0% | [Pledge of Assets](index=20&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, and December 31, 2024, the Group had not pledged any assets - As of June 30, 2025, and December 31, 2024, the Group had not pledged any assets[54](index=54&type=chunk) [Foreign Exchange Risk](index=20&type=section&id=Foreign%20Exchange%20Risk) The Group's transactions are primarily denominated in EUR, USD, and local currencies, with management actively monitoring the market to mitigate exchange rate risks - The Group's transactions are primarily denominated in Euros, US Dollars, and local currencies where operations are conducted, including Polish Zloty, Czech Koruna, and British Pounds[55](index=55&type=chunk) - The Group will closely monitor the foreign exchange market and take reasonable and effective measures from time to time to eliminate any negative impact caused by exchange rate risks as much as possible[55](index=55&type=chunk) [Capital and Other Commitments](index=20&type=section&id=Capital%20and%20Other%20Commitments) Except for plant and machinery capital commitments disclosed in Note 18, the Group and Company had no other commitments at period-end - Except as disclosed in Note 18 to the interim financial information, the Group and the Company had no other commitments as of June 30, 2025, and December 31, 2024[56](index=56&type=chunk) [Contingent Liabilities](index=20&type=section&id=Contingent%20Liabilities) As of June 30, 2025, and December 31, 2024, the Group and Company had no significant contingent liabilities - As of June 30, 2025, and December 31, 2024, the Group and the Company had no significant contingent liabilities[57](index=57&type=chunk) [Other Information](index=21&type=section&id=Other%20Information) This section provides supplementary information on rights issue proceeds, EHS measures, outlook, employees, listed securities, and corporate governance, including Board member introductions [Use of Proceeds from Rights Issue](index=21&type=section&id=Use%20of%20Proceeds%20from%20Rights%20Issue) The Company completed a rights issue in October 2024, raising HKD 46.4 million, with most funds used for working capital at Polish and French technical centers, and HKD 6.4 million remaining for Hong Kong headquarters - The Company completed a rights issue on October 21, 2024, raising net proceeds of approximately **HKD 46.4 million**[58](index=58&type=chunk) Use of Proceeds from Rights Issue and Unutilized Balance | Intended Use | Intended Use of Proceeds from Rights Issue (HKD millions) | Actual Use of Net Proceeds as of June 30, 2025 (HKD millions) | Unutilized Net Proceeds as of June 30, 2025 (HKD millions) | | :--- | :--- | :--- | :--- | | For working capital of the Group's production plants in Poland and the Czech Republic | 25.5 | – | 0.2 | | For working capital of the Company's headquarters in Hong Kong | 11.6 | 5.4 | 6.2 | | For working capital of the Group's technical centers in Poland and France | 9.3 | 9.3 | – | | **Total** | **46.4** | **14.7** | **6.4** | [Environmental, Health and Safety](index=21&type=section&id=Environmental,%20Health%20and%20Safety) The Group is committed to environmental protection and employee health and safety, implementing control plans, obtaining permits, providing training, and complying with regulations - The Group is committed to protecting human health, natural resources, and the global environment, having adopted hazardous substance control plans and chemical assessment procedures, and obtained necessary environmental permits[59](index=59&type=chunk) - The Group strictly complies with various environmental laws and regulations related to emissions and waste generation from its production facilities into land, air, and water[60](index=60&type=chunk) - The Group prioritizes employee health and safety, providing occupational health and safety training and implementing human resource policies to reduce accidents[60](index=60&type=chunk) [Outlook](index=22&type=section&id=Outlook) The Group anticipates global economic uncertainty from geopolitical tensions and tariffs, but expects Eurozone growth, with the Czech plant closure enhancing efficiency, and continued R&D investment for sustainable development - Geopolitical tensions, the Russia-Ukraine conflict, and tariff threats will add uncertainty to the future global political and economic landscape[62](index=62&type=chunk) - European passenger car production in 2024 increased by **4.4%** compared to 2023, but remains **18.6%** below pre-pandemic levels, indicating room for further recovery[63](index=63&type=chunk) - The International Monetary Fund forecasts Eurozone GDP to grow by **1.5%** in 2025, signaling stable economic development in Europe[63](index=63&type=chunk) - The Czech plant closure plan is progressing smoothly, with production lines expected to be transferred to Poland by the end of this year and the premises returned to the landlord by the end of Q1 next year; management believes this will enhance resource integration efficiency and capacity utilization[64](index=64&type=chunk) - The Group will continue to invest in R&D and engineering activities, collaborating closely with automotive manufacturers to develop innovative solutions to maintain industry leadership and long-term sustainable development[65](index=65&type=chunk) [Employees](index=24&type=section&id=Employees) As of June 30, 2025, the Group had 2,013 employees with a total cost of HKD 392.3 million, offering attractive compensation, retirement plans, and benefits Employee Count and Cost | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Number of employees | 2,013 employees | 2,360 employees | | Total employee cost | HKD 392.3 million | HKD 289.3 million | - The Group offers comprehensive and attractive compensation, retirement plans, and benefits to its employees, including defined benefit pension plans and MPF schemes[66](index=66&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=24&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During the review period, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities on any exchange - During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities on The Stock Exchange of Hong Kong Limited or any other securities exchange[67](index=67&type=chunk) [Compliance with Corporate Governance Code](index=24&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company complied with the Corporate Governance Code provisions in Appendix C1 of the Listing Rules for the six months ended June 30, 2025 - The Company complied with the code provisions of the Corporate Governance Code set out in Appendix C1 to the Listing Rules of The Stock Exchange for the six months ended June 30, 2025[68](index=68&type=chunk) [Acknowledgement](index=24&type=section&id=Acknowledgement) The Board Chairman extends sincere gratitude to customers, suppliers, shareholders, management, and employees for their support and dedication during the period - The Chairman of the Board, on behalf of the Board, extends sincere gratitude to all customers, suppliers, and shareholders for their continuous support to the Group; and also expresses deep appreciation and commendation to all management and employees of the Group for their tireless efforts and concerted dedication during the period[69](index=69&type=chunk) [Board Composition](index=24&type=section&id=Board%20Composition) As of the announcement date, the Board comprises Mr. Dong Xiaojie (Chairman), two Executive Directors, and three Independent Non-executive Directors - As of the announcement date, the Board comprises Mr. Dong Xiaojie (Chairman), Mr. Liu Xihe (Executive Director), Dr. Xi Jianpeng (Executive Director), Mr. Huang Kejie (Independent Non-executive Director), Mr. Lo Ka Ming (Independent Non-executive Director), and Ms. Peng Fan (Independent Non-executive Director)[71](index=71&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 不 會 就 因 本 公 告 全 部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 ZMJ Group Company Limited 中創智領（鄭州）工業技術集團股份有限公司 （在 中 華 人 民 共 和 國 註 冊 成 立 的 股 份 有 限 公 司） （股 份 代 碼：00564） 截 至2025年6月30日止六個月 中期業績公告 中創智領（鄭 州）工業技術集團股份有限公司（「本公司」）之董事會（「董事會」）謹 此 宣佈本公司及其附屬公司截至2025年6月30日 止 六 個 月 之 未 經 審 核 中 期 業 績。 本 公 司 董 事 會 之 審 計 委 員 會 已 審 閱 此 中 期 業 績。 刊載中期業績公告及中期報告 本中期業績公告將刊載於香港聯合交易所有限公司網站(www.hkexnews.hk)及 本 公司網站(www.zmj.com)。 本公司將於適當時間發佈本公司2025年 中 期 報 告，並 於 本 公 司 ...

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之內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何 部份內容而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 CCIAM Future Energy Limited 信能低碳有限公司 （ 於 香 港 註 冊 成 立 之 有 限 公 司 ） （股份代號：145） 截至二零二五年六月三十日止六個月之 中期業績 信能低碳有限公司（「本公司」）之董事（「董事」）會（「董事會」）欣然公佈本公司 及其附屬公司（統稱「本集團」）截至二零二五年六月三十日止六個月之未經審核 簡明綜合中期業績連同截至二零二四年六月三十日止六個月之未經審核比較數字 如下： 簡明綜合損益及其他全面收益表 截至二零二五年六月三十日止六個月 | | | 截至六月三十日止六個月 | | | --- | --- | --- | --- | | | | 二零二五年 | 二零二四年 | | | 附註 | 千港元 | 千港元 | | | | （未經審核） | （未經審核） | | 收益 | 4 | 8,720 | 10,262 | | 經營成本 | | (7,426 ...